Interpreting Financial Results

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Guide To Use of Worksheets following the sequence of pages of the complete reports and financial statements for a non-private entity with a subsidiary company in Malaysia
Name of worksheet Page No. as shown in Table of Contents
The Cover Page Click Here MAINDOCUMENTS Not applicable
The Cover Page for copy to be lodged with Companies Commissions of Malaysia (previously Registrar of Companies) Click Here MAINDOCUMENTS Not applicable
Table of Contents Click Here MAINDOCUMENTS
Directors' report Click Here MAINDOCUMENTS 1 - 3
Statement by directors and statutory declaration Click Here MAINDOCUMENTS 4
Auditors' report first page Click Here AuditorsReportPg5 5
Auditors' report second page Click Here AuditorsReportPg6 6
CONSOLIDATED STATEMENT OF FINANCIAL POSITION Click Here MAINDOCUMENTS 7
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME Click Here MAINDOCUMENTS 8
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY Click Here MAINDOCUMENTS 9
CONSOLIDATED STATEMENT OF CASH FLOWS PAGE 1 Click Here MAINDOCUMENTS 10
CONSOLIDATED STATEMENT OF CASH FLOWS PAGE 2 Click Here MAINDOCUMENTS 11
STATEMENT OF FINANCIAL POSITION Click Here MAINDOCUMENTS 12
STATEMENT OF COMPREHENSIVE INCOME Click Here MAINDOCUMENTS 13
STATEMENT OF CHANGES IN EQUITY Click Here MAINDOCUMENTS 14
STATEMENT OF CASH FLOWS PAGE 1 Click Here MAINDOCUMENTS 15
STATEMENT OF CASH FLOWS PAGE 2 Click Here MAINDOCUMENTS 16
NOTES TO THE FINANCIAL STATEMENTS
SIGNIFICANT ACCOUNTING POLICIES (Comprising Basis of Preparation, Standards, and Interpretations) Click Here MAINDOCUMENTS 17 - 19
SIGNIFICANT ACCOUNTING POLICIES (Comprising Basis of Consolidation & Goodwill) Click Here MAINDOCUMENTS 19 - 20
SIGNIFICANT ACCOUNTING POLICIES (Comprising Investments, Property, Plant, and Equipment and Depreciation, Financial Assets) Click Here MAINDOCUMENTS 20 - 21
SIGNIFICANT ACCOUNTING POLICIES (Comprising Financial Liabilities, Offsetting Financial Instruments, & Impairment of Financial Assets) Click Here MAINDOCUMENTS 21 - 22
SIGNIFICANT ACCOUNTING POLICIES (Impairment of Non-Financial Assets, Income Taxes, Revenue Recognition, & Foreign Currency Transactions and Balances) Click Here MAINDOCUMENTS 23 - 24
SIGNIFICANT ACCOUNTING POLICIES (Employee Benefits, Leases, Segment Reporting, Contingencies, & Financial Risk Management Policies) Click Here MAINDOCUMENTS 24 - 25
SIGNIFICANT ACCOUNTING POLICIES (Comprising Critical Accounting Estimates, Judgments, and Key Sources of Estimation Uncertainty ) and NOTE ON PROPERTY, PLANT, AND EQUIPMENT PART 1 FOR COMPANY Click Here Note-PPE 26
NOTE ON PROPERTY, PLANT, AND EQUIPMENT PART 2 FOR GROUP Click Here Note-PPE 27
NOTE ON AVAILABLE-FOR-SALE FINANCIAL ASSETS, INVESTMENT IN ASSOCIATED COMPANY, AND PART 1 OF INVESTMENT IN SUBSIDIARY COMPANY Click Here MAINDOCUMENTS 28
NOTE ON PART 2 OF INVESTMENT IN SUBSIDIARY COMPANY AND PART 1 OF TRADE RECEIVABLES Click Here MAINDOCUMENTS 29
NOTE ON PART 2 OF TRADE RECEIVABLES AND AMOUNT DUE FROM ASSOCIATED COMPANY Click Here MAINDOCUMENTS 30
NOTE ON AMOUNT DUE FROM SUBSIDIARY COMPANY, FIXED DEPOSITS WITH LICENSED BANKS, OTHER PAYABLES AND ACCRUALS, HIRE PURCHASE AND LEASE PAYABLES, AND PART 1 OF BORROWINGS Click Here MAINDOCUMENTS 31
NOTE ON PART 2 OF BANK BORROWINGS, SHARE CAPITAL, DEFERRED TAX LIABILITIES, AND REVENUE Click Here MAINDOCUMENTS 32
NOTE ON PROFIT BEFORE-TAXATION, TAXATION, CONTINGENT LIABILITIES, FINANCIAL INSTRUMENTS BY CATEGORY, & PART 1 OF RELATED PARTIES Click Here MAINDOCUMENTS 33
NOTE ON CONTINGENT LIABILITIES, FINANCIAL INSTRUMENTS BY CATEGORY, & PART 1 OF RELATED PARTIES Click Here MAINDOCUMENTS 34
NOTE ON PART 2 OF RELATED PARTIES Click Here MAINDOCUMENTS 35
DETAILED INCOME STATEMENT PART 1 Click Here MAINDOCUMENTS Not applicable
DETAILED INCOME STATEMENT PART 2 Click Here MAINDOCUMENTS Not applicable
DETAILED INCOME STATEMENT PART 3 Click Here MAINDOCUMENTS Not applicable

MAINDOCUMENTS

Company No.: 12345-X
ABC SDN. BHD.
(Incorporated in Malaysia)
REPORTS AND FINANCIAL STATEMENTS
31 December 2010
DEF & CO. (AF 1234)
CHARTERED ACCOUNTANTS Click To Go Back To Guide To Use Of Worksheets
Company No.: 12345-X
ABC SDN. BHD.
(Incorporated in Malaysia)
REPORTS AND FINANCIAL STATEMENTS
31 December 2010
CONTENTS PAGE NO.
DIRECTORS' REPORT 1 - 3
STATEMENT BY DIRECTORS AND STATUTORY DECLARATION 4
INDEPENDENT AUDITORS' REPORT 5 - 6
CONSOLIDATED STATEMENT OF FINANCIAL POSITION 7
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME 8
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY 9
CONSOLIDATED STATEMENT OF CASH FLOWS 10 - 11
STATEMENT OF FINANCIAL POSITION 12
STATEMENT OF COMPREHENSIVE INCOME 13
STATEMENT OF CHANGES IN EQUITY 14
STATEMENT OF CASH FLOWS 15 - 16
NOTES TO THE FINANCIAL STATEMENTS 17 - 35
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Company No.: 12345-X 1
ABC SDN. BHD.
(Incorporated in Malaysia)
DIRECTORS' REPORT FOR THE YEAR ENDED
31 December 2010
The directors have pleasure in submitting their report together with the audited financial statements of the Company for the year ended 31 December 2010.
PRINCIPAL ACTIVITIES
The Company is principally engaged in the provision of forwarding, warehousing, haulage, and air freight services. There have been no significant changes in the nature of these activities during the year.
The principal activity of the subsidiary company is disclosed in Note 8 to the financial statements.
FINANCIAL RESULTS
GROUP COMPANY
RM RM
Net profit for the year 1,881,000 3,022,000
ISSUE OF SHARES
There were no new shares or debentures issued by the Company during the financial year.
DIVIDENDS
The directors do not recommend that a dividend be paid for the year.
RESERVES AND PROVISIONS
There were no material transfers to or from reserves or provisions during the financial year.
DIRECTORS
The directors since the last report are as follows:
Abdul Bin Malek
Muthusamy A/L Ramasamy (Appointed on 8 February 2010 and resigned on 23 June 2010)
Chan Kim Kong (Resigned on 23 June 2010)
Fernando Morientes (Appointed on 23 June 2010)
In accordance with the Articles of Association, Mr. Muthusamy A/L Ramasamy retires from the board at the forthcoming Annual General Meeting and, being eligible, offers himself for re-election.
DIRECTORS' INTERESTS IN SHARES
According to the register of directors' shareholdings, the interest of director in the shares of the Company at the end of the financial year was as follows:
Number of ordinary shares of RM1/- each
As at As at
1 January 2010 Acquired Disposed 31 December 2010
The Company
Abdul Bin Malek 20,000 - (20,000) -
The Holding Company
ABC International Group
Bhd.
Abdul Bin Malek 480,000 - (120,000) 360,000
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Company No.: 12345-X 2
DIRECTORS' INTERESTS IN SHARES (CONTINUED)
By virtue of Mr. Abdul Bin Malek's interest in the shares of the holding company, he is also deemed to have interest in the shares of the Company and all the subsidiary companies to the extent the Holding Company has an interest.
DIRECTORS' BENEFITS
Since the end of the previous financial year, no director of the Company has received or become entitled to receive any benefit (other than as disclosed in the financial statements) by reason of a contract made by the Company, or a related corporation with the director or his nominees, or with a firm of which the director is a member, or with a company in which the director has a substantial financial interest.
Neither during nor at the end of the financial year, was the Company a party to any arrangement whose object is to enable the directors to acquire benefits by means of the acquisition of shares in or debentures of the Company or any other body corporate.
STATUTORY INFORMATION ON THE FINANCIAL STATEMENTS
(a) Before the statement of comprehensive income statement and statement of financial position of the Group and of the Company were made out, the directors have taken reasonable steps:
(i) to ascertain that proper action has been taken in relation to the writing off of bad debts and the making of allowance for doubtful debts and have satisfied themselves that all known bad debts have been written off and adequate allowance had been made for doubtful debts; and
(ii) to ensure that any current assets which were unlikely to realize their value as shown in the financial statements in the ordinary course of business have been written down to an amount which they might be expected so to realize.
(b) As at the date of this report, the directors are not aware of any circumstances:
(i) which would render the amount written off for bad debts and allowances made for doubtful debts inadequate to any substantial extent;
(ii) which would render the values of current assets in the financial statements misleading;
(iii) which have arisen which render adherence to the existing method of valuation of assets or liabilities of the Group and of the Company misleading or inappropriate; or
(iv) not otherwise dealt with in this report or the financial statements of the Group and of the Company which would render any amount stated in the financial statements misleading.
(c) As at the date of this report, there does not exist:
(i) any charge on the assets of the Group and of the Company which has arisen since the end of the financial year which secures the liabilities of any other person; or
(ii) any contingent liability which has arisen since the end of the financial year.
OTHER STATUTORY INFORMATION
At the date of this report, the directors are not aware of any circumstances, not otherwise dealt with in this report or the financial statements of the Group and of the Company, that would render any amount stated in the financial statements misleading.
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Company No.: 12345-X 3
OTHER STATUTORY INFORMATION (CONTINUED)
In the opinion of the directors:
(a) the results of the Company's operations during the financial year were not substantially affected by any item, transaction, or event of material and unusual nature;
(b) no item, transaction, or event of a material and unusual nature has arisen in the interval between the end of the financial year and the date of this report that is likely to affect substantially the results of operations of the Group and of the Company for the financial year in which this report is made other than the effect of share of profits from associate acquired during the year as disclosed in Note 7 to the financial statements; and
(c) no contingent or other liabilities have become enforceable or are likely to become enforceable within the period of 12 months after the end of the financial year that will or may affect the ability of the Group and of the Company to meet its obligations as and when they fall due.
HOLDING COMPANY
The Holding Company is ABC International Group Bhd., a company incorporated in the Malaysia.
AUDITORS
Messrs. DEF & Co. have expressed their willingness to continue in office.
SIGNED ON BEHALF OF THE BOARD OF DIRECTORS IN ACCORDANCE WITH A RESOLUTION OF THE DIRECTORS
.......................................... ………………………………
ABDUL BIN MALEK FERNANDO MORIENTES
Director Director
WONDERLAND
Dated:
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Company No.: 12345-X 4
ABC SDN. BHD.
(Incorporated in Malaysia)
STATEMENT BY DIRECTORS
We, ABDUL BIN MALEK and FERNANDO MORIENTES, being the directors of ABC SDN. BHD. do hereby state that in our opinion, the financial statements set out on pp. 7 to 35 are drawn up in accordance with Financial Reporting Standards in Malaysia and the provisions of the Companies Act 1965 so as to give a true and fair view of the financial position of the Group and of the Company as at 31 December 2010 and of their results and cash flows for the year ended on that date.
Signed at Wonderland this
ON BEHALF OF THE BOARD,
..................................................
ABDUL BIN MALEK
Director
..................................................
FERNANDO MORIENTES
Director
STATUTORY DECLARATION
I, ABDUL BIN MALEK, being the director primarily responsible for the financial management of ABC SDN. BHD. do solemnly and sincerely declare that to the best of my knowledge and belief the financial statements set out on pp. 7 to 35 are correct, and I make this solemn declaration conscientiously believing the same to be true and by virtue of the provisions of the Statutory Declarations Act, 1960.
Subscribed and solemnly declared )
by the above named )
at Wonderland this )
)
Before me,
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Company No.: 12345-X 7
ABC SDN. BHD.
(Incorporated in Malaysia)
CONSOLIDATED STATEMENT OF FINANCIAL POSITION AS AT
31 December 2010
2010 2009
NOTE RM RM
TOTAL ASSETS
NON-CURRENT ASSETS
Property, plant, and equipment 5 502,000 285,000
Available-for-sale financial assets 6 66,000 13,000
Investment in associated company 7 2,300,000 -
Intangible asset (goodwill) 8 34,000
2,868,000 298,000
CURRENT ASSETS
Trade receivables 9 20,977,000 19,382,000
Other receivables, deposits, & prepayments 2,013,540 487,000
Tax recoverable 13,450 -
Fixed deposits with a licensed bank 12 4,120,000 300,000
Cash and bank balances 2,184,000 600,000
29,307,990 20,769,000
32,175,990 21,067,000
TOTAL EQUITY AND LIABILITIES
EQUITY
SHARE CAPITAL 16 5,000,000 5,000,000
ACCUMULATED PROFITS 6,141,000 4,260,000
TOTAL EQUITY ATTRIBUTABLE TO OWNERS OF THE COMPANY 11,141,000 9,260,000
MINORITY INTEREST 17,100 -
TOTAL EQUITY 11,158,100 9,260,000
LIABILITIES
NON-CURRENT LIABILITIES
Bank borrowings 15 400,000 -
Hire purchase and finance lease payables 14 100,000 135,000
Deferred tax liabilities 17 12,000 5,000
512,000 140,000
CURRENT LIABILITIES
Trade payables 18,069,890 10,847,000
Other payables and accruals 13 1,990,000 550,000
Hire purchase and finance lease payables 14 30,000 30,000
Bank borrowings 15 450,000 140,000
Taxation - 100,000
20,539,890 11,667,000
TOTAL LIABILITIES 21,051,890 11,807,000
32,209,990 21,067,000
The annexed Notes form an integral part of the financial statements. Auditors' Report on pp. 5 & 6. Click To Go Back To Guide To Use Of Worksheets
Company No.: 12345-X 8
ABC SDN. BHD.
(Incorporated in Malaysia)
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME FOR THE YEAR ENDED
31 December 2010
2010 2009
NOTE RM RM
Revenue 18 121,777,000 200,062,000
Cost of sales (104,145,000) (178,500,000)
Gross profit 17,632,000 21,562,000
Other operating income 333,000 120,000
Operating and administrative expenses (16,260,000) (15,420,000)
Profit from operations 1,705,000 6,262,000
Finance costs (315,000) (103,000)
Share of post acquisition profits in associated company 2,300,000 -
Profit before taxation 19 3,690,000 6,159,000
Taxation 20 (1,809,000) (2,196,000)
Net profit after taxation, representing total comprehensive income during the year 1,881,000 3,963,000
Total comprehensive income attributable to:
Owners of the Company 1,881,000 3,860,000
Minority interest - 0 - 0
1,881,000 3,860,000
The annexed Notes form an integral part of the financial statements. Auditors' Report on pp. 5 & 6. Click To Go Back To Guide To Use Of Worksheets
Company No.: 12345-X 9
ABC SDN. BHD.
(Incorporated in Malaysia)
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY FOR THE YEAR ENDED
31 December 2010
Share Retained
capital profits Total
RM RM RM
As at 1 January 2009 5,000,000 400,000 5,400,000
Total comprehensive income during the year - 3,860,000 3,860,000
As at 31 December 2009 5,000,000 4,260,000 9,260,000
Total comprehensive income during the year - 1,881,000 1,881,000
As at 31 December 2010 5,000,000 6,141,000 11,141,000
The annexed Notes form an integral part of the financial statements. Auditors' Report on pp. 5 & 6. Click To Go Back To Guide To Use Of Worksheets
Company No.: 12345-X 10
ABC SDN. BHD.
(Incorporated in Malaysia)
CONSOLIDATED STATEMENT OF CASH FLOWS FOR THE YEAR ENDED
31 December 2010
2010 2009
NOTE RM RM
CASH FLOW FROM OPERATING ACTIVITIES
Profit before taxation 3,690,000 6,159,000
Adjustments for:
Impairment of trade receivables - 802,000
Depreciation 126,000 125,000
Share of post acquisition profits in associated company (2,300,000) -
Interest expense 315,000 103,000
Interest income (150,000) (30,000)
Unrealized loss / (gain) on foreign exchange 102,000 (90,000)
Operating profit before changes in working capital 1,783,000 7,069,000
Decrease in receivables (3,099,540) (4,873,952)
Increase / (Decrease) in payables 8,553,890 (1,500,048)
Net cash generated from operations 7,237,350 695,000
Taxation paid (1,615,450) (85,000)
Net cash inflow from operating activities 5,621,900 610,000
CASH FLOW FROM INVESTING ACTIVITIES
Interest received 150,000 30,000
Investment in associated company (300,000) -
Purchase of available-for-sale financial assets (53,000) -
Purchase of property, plant, and equipment (340,000) (7,000)
Acquisition of subsidiaries, net of cash and cash equivalents 8 (34,900) -
Net cash (outflow) / inflow from investing activities (577,900) 23,000
CASH FLOW FROM FINANCING ACTIVITIES
Changes of fixed deposit pledged as security (3,820,000) (12,000)
Interest paid (315,000) (103,000)
Proceeds from term loan 650,000 -
Repayment of term loan (100,000) -
Repayment of hire purchase payables (35,000) (35,000)
Net cash outflow from financing activities (3,620,000) (150,000)
NET INCREASE IN CASH AND
CASH EQUIVALENTS 1,424,000 483,000
CASH AND CASH EQUIVALENTS AT THE BEGINNING
OF YEAR 563,000 80,000
CASH AND CASH EQUIVALENTS AT THE END
OF YEAR 1,987,000 563,000
The annexed Notes form an integral part of the financial statements. Auditors' Report on pp. 5 & 6. Click To Go Back To Guide To Use Of Worksheets
Company No.: 12345-X 11
ABC SDN. BHD.
(Incorporated in Malaysia)
CONSOLIDATED STATEMENT OF CASH FLOWS FOR THE YEAR ENDED
31 December 2010
2010 2009
NOTE RM RM
CASH AND CASH EQUIVALENTS COMPRISE:
Fixed deposits with a licensed bank 4,120,000 300,000
Cash and bank balances 2,184,000 600,000
Bank overdraft 15 (300,000) (140,000)
Less : Fixed deposit pledged as security (4,120,000) (300,000)
1,884,000 460,000
The annexed Notes form an integral part of the financial statements. Auditors' Report on pp. 5 & 6. Click To Go Back To Guide To Use Of Worksheets
Company No.: 12345-X 12
ABC SDN. BHD.
(Incorporated in Malaysia)
STATEMENT OF FINANCIAL POSITION AS AT
31 December 2010
2010 2009
NOTE RM RM
TOTAL ASSETS
NON-CURRENT ASSETS
Property, plant, and equipment 5 500,000 285,000
Available-for-sale financial assets 6 66,000 13,000
Investment in associated company 7 300,000 -
Investment in subsidiary company 8 54,900 -
920,900 298,000
CURRENT ASSETS
Trade receivables 9 20,102,000 19,382,000
Other receivables, deposits, & prepayments 550,000 487,000
Tax recoverable 2,000 -
Fixed deposits with a licensed bank 12 500,000 300,000
Cash and bank balances 220,000 600,000
21,374,000 20,769,000
22,294,900 21,067,000
TOTAL EQUITY AND LIABILITIES
EQUITY
SHARE CAPITAL 16 5,000,000 5,000,000
ACCUMULATED PROFITS 7,385,000 4,363,000
TOTAL EQUITY 12,385,000 9,363,000
LIABILITIES
NON-CURRENT LIABILITIES
Bank borrowings 15 400,000 -
Hire purchase and finance lease payables 14 100,000 135,000
Deferred tax liabilities 17 12,000 5,000
512,000 140,000
CURRENT LIABILITIES
Trade payables 8,695,900 10,847,000
Other payables and accruals 13 640,000 550,000
Hire purchase and finance lease payables 14 30,000 30,000
Bank borrowings 15 450,000 140,000
Taxation - 100,000
9,815,900 11,667,000
TOTAL LIABILITIES 10,327,900 11,807,000
22,712,900 21,170,000
The annexed Notes form an integral part of the financial statements. Auditors' Report on pp. 5 & 6. Click To Go Back To Guide To Use Of Worksheets
Company No.: 12345-X 13
ABC SDN. BHD.
(Incorporated in Malaysia)
STATEMENT OF COMPREHENSIVE INCOME FOR THE YEAR ENDED
31 December 2010
2010 2009
NOTE RM RM
Revenue 18 121,592,000 200,062,000
Cost of sales (103,934,000) (178,500,000)
Gross profit 17,658,000 21,562,000
Other operating income 130,000 120,000
Operating and administrative expenses (12,944,000) (15,420,000)
Profit from operations 4,844,000 6,262,000
Finance costs (315,000) (103,000)
Profit before taxation 4,529,000 6,159,000
Taxation 19 (1,507,000) (2,196,000)
Net profit after taxation, representing total comprehensive income during the year 3,022,000 3,963,000
Total comprehensive income attributable to:
Owners of the Company 2,707,000 3,860,000
Minority interest - 0 - 0
2,707,000 3,860,000
The annexed Notes form an integral part of the financial statements. Auditors' Report on pp. 5 & 6. Click To Go Back To Guide To Use Of Worksheets
Company No.: 12345-X 14
ABC SDN. BHD.
(Incorporated in Malaysia)
STATEMENT OF CHANGES IN EQUITY FOR THE YEAR ENDED
31 December 2010
Share Retained
capital profits Total
RM RM RM
As at 1 January 2009 5,000,000 400,000 5,400,000
Total comprehensive income during the year - 3,963,000 3,963,000
As at 31 December 2009 5,000,000 4,363,000 9,363,000
Total comprehensive income during the year - 3,022,000 3,022,000
As at 31 December 2010 5,000,000 7,385,000 12,385,000
The annexed Notes form an integral part of the financial statements. Auditors' Report on pp. 5 & 6. Click To Go Back To Guide To Use Of Worksheets
Company No.: 12345-X 15
ABC SDN. BHD.
(Incorporated in Malaysia)
STATEMENT OF CASH FLOWS FOR THE YEAR ENDED
31 December 2010
2010 2009
RM RM
CASH FLOW FROM OPERATING ACTIVITIES
Profit before taxation 4,529,000 6,159,000
Adjustments for:
Allowance for doubtful debts no longer required - -
Impairment of trade receivables - 0 802,000
Depreciation 125,000 125,000
Interest expense 315,000 103,000
Interest income - 0 (30,000)
Unrealized loss / (gain) on foreign exchange 102,000 (90,000)
Operating profit before changes in working capital 5,071,000 7,069,000
Increase in receivables (885,000) (4,873,952)
Decrease in payables (2,061,100) (1,500,048)
Net cash generated from operations 2,124,900 695,000
Taxation paid (1,602,000) (85,000)
Net cash inflow from operating activities 522,900 610,000
CASH FLOW FROM INVESTING ACTIVITIES
Interest received - 30,000
Investment in subsidiary company (54,900) -
Investment in associated company (300,000) -
Purchase of available-for-sale financial assets (53,000) -
Purchase of property, plant, and equipment (340,000) (7,000)
Net cash (outflow) / inflow from investing activities (747,900) 23,000
CASH FLOW FROM FINANCING ACTIVITIES
Changes in fixed deposit held as security (200,000) (12,000)
Interest paid (315,000) (103,000)
Proceeds from term loan 650,000 -
Repayment of term loan (100,000) -
Repayment of finance payables (35,000) (35,000)
Net cash outflow from financing activities - (150,000)
NET (DECREASE) / INCREASE IN CASH AND
CASH EQUIVALENTS (225,000) 483,000
CASH AND CASH EQUIVALENTS AT THE BEGINNING
OF YEAR 460,000 80,000
CASH AND CASH EQUIVALENTS AT THE END
OF YEAR 235,000 563,000
The annexed Notes form an integral part of the financial statements. Auditors' Report on pp. 5 & 6. Click To Go Back To Guide To Use Of Worksheets
Company No.: 12345-X 16
ABC SDN. BHD.
(Incorporated in Malaysia)
STATEMENT OF CASH FLOWS FOR THE YEAR ENDED
31 December 2010
2010 2009
NOTE RM RM
CASH AND CASH EQUIVALENTS COMPRISE:
Fixed deposits with a licensed bank 500,000 300,000
Cash and bank balances 220,000 600,000
Bank overdraft 15 (300,000) (140,000)
Less : Fixed deposit pledged as security (500,000) (300,000)
(80,000) 460,000
The annexed Notes form an integral part of the financial statements. Auditors' Report on pp. 5 & 6. Click To Go Back To Guide To Use Of Worksheets
Company No.: 12345-X 17
ABC SDN. BHD.
(Incorporated in Malaysia)
NOTES TO THE FINANCIAL STATEMENTS
31 December 2010
1. GENERAL INFORMATION
The Company is a limited liability company, incorporated and domiciled in Malaysia. The addresses of the principal place of business and registered office of the Company are as follows:
Principal place of business
123, Wonderful Mansion,
55880 Wonderful City
Wonderful Land
Registered office
888, Lucky Mansion,
55880 Wonderful City
Wonderful Land
The financial statements were authorized for issue by the Board Of Directors on
2. SIGNIFICANT ACCOUNTING POLICIES
a) Basis of preparation of financial statements
(i) The financial statements have been prepared under the historical cost convention modified to include financial assets and financial liabilities stated at fair value and in accordance with Financial Reporting Standards (FRSs) accounting principles generally accepted and Companies Act, 1965 in Malaysia. The financial statements have been prepared in accordance with the same accounting policies and method of computations consist of those of the previous financial year, except for changes in accounting policies due to adoption of the relevant new and revised FRSs, IC Interpretations and Amendments to FRSs and IC Interpretations that are mandatory for financial periods beginning on or after 1 January 2010 as described in Note 2 b).
(ii) The financial statements are presented in Ringgit Malaysia (M). Ringgit Malaysia (RM) is the presentation and functional currency of the Group and of the Company.
(iii) The preparation of financial statements in conformity with IFRS requires the use of certain critical accounting estimates. It also requires management to exercise its judgment in the process of applying the group’s accounting policies. The areas involving a higher degree of judgment or complexity, or areas where assumptions and estimates are significant to the consolidated financial statements are disclosed in Note 4.
b) Standards and interpretations
(i) Standards and interpretations effective during the financial year
The Company has adopted all the new accounting standards, amendments to published standards and interpretations to existing standards effective during the financial year.
However, the adoption of these standards, amendments to published standards, and interpretations to existing standards have no significant impact on the financial statements of the Company.
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Company No.: 12345-X 18
b) Standards and interpretations (continued)
(ii) Standards and interpretations issued and not yet effective
FRSs Effective date
/Interpretations
Amendments to FRS 132 Financial Instruments: Presentation - Classification of rights issues 1 March 2010
FRS 1 First-time adoption of Financial Reporting Standards (revised) 1 July 2010
Amendments to FRS 2 Share-based Payment 1 July 2010
FRS 3 Business Combinations (revised) 1 July 2010
Amendments to FRS 5 Non-current Assets Held for Sale and Discontinued Operations 1 July 2010
FRS 127 Consolidated and Separate financial Statements (revised) 1 July 2010
Amendments to FRS 138 Intangible Assets 1 July 2010
Amendments to IC Interpretation 9 Reassessment of Embedded Derivatives 1 July 2010
IC Interpretation 12 Services Concession Arrangements 1 July 2010
IC Interpretation 16 Hedges of a Net Investment in a Foreign Operation 1 July 2010
IC Interpretation 17 Distributions of Non-cash Assets to Owners 1 July 2010
Amendments to IC Interpretation 15 Amendments to IC Interpretation 15 30 August 2010
TR 3 Guidance on Disclosures of Transition to IFRSs 31 December 2010
Amendments to FRS 1 Limited Exemption from Comparative FRS 7 Disclosures for First-time Adopters, Additional Exemptions for First-time Adopters and Improvements to FRSs (2010) 1 January 2011
Amendments to FRS 2 Group Cash-settled Share-based Payment Transactions 1 January 2011
Amendments to FRS 3 Improvements to FRSs (2010) 1 January 2011
Amendments to FRS 7 Improving Disclosures about Financial Instruments and Improvements to FRSs (2010) 1 January 2011
Amendments to FRS 101 Improvements to FRSs (2010) 1 January 2011
Amendments to FRS 121 Improvements to FRSs (2010) 1 January 2011
Amendments to FRS 128 Improvements to FRSs (2010) 1 January 2011
Amendments to FRS 131 Improvements to FRSs (2010) 1 January 2011
Amendments to FRS 132 Improvements to FRSs (2010) 1 January 2011
Amendments to FRS 134 Improvements to FRSs (2010) 1 January 2011
Amendments to FRS 139 Improvements to FRSs (2010) 1 January 2011
IC Interpretation 4 Determining Whether an Arrangement contains a Lease 1 January 2011
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Company No.: 12345-X 19
b) Standards and interpretations (continued)
(ii) Standards and interpretations issued and not yet effective (continued)
FRSs Effective date
/Interpretations
IC Interpretation 18 Transfers of Assets from Customers 1 January 2011
TR i-4 Shariah Compliant Sale Contracts 1 January 2011
Amendments to IC Interpretation 13 Improvements to FRSs (2010) 1 January 2011
Amendments to IC Interpretation 14 Prepayments of a Minimum Funding Requirement 1 July 2011
IC Interpretation 19 Extinguishing Financial Liabilities with Equity Instruments 1 July 2011
FRS 124 Related Party Disclosures (revised) 1 January 2012
IC Interpretation 15 Agreements for the Construction of Real Estate 1 January 2012
The adoption of these FRSs and their consequential amendments, Amendments to FRSs and IC Interpretations are not expected to have any significant impact on the financial statements of the Company.
The initial application of other standards, amendments or interpretations is not expected to have any financial impact to the current or prior years’ financial statements upon their first adoption.
c) Basis of consolidation
The consolidated financial statements include the financial statements of the Company and its subsidiary companies made up to the end of the financial year. A subsidiary company is a company in which the Group has power to exercise control over the financial and operating policies so as to obtain benefits therefore. Subsidiary companies are consolidated using the acquisition method of accounting from the date control is transferred to the Group and are no longer consolidated from the date control cease. Intra-group transactions and resulting unrealized profits or losses are eliminated fully on consolidation and consolidated financial statements reflect external transactions only. Any excess of the cost of business combination over the Group's interest in the net fair value of identifiable assets, liabilities and contingent liabilities is reflected as goodwill. Any excess of the Group's interest in the net fair value of identifiable assets, liabilities and contingent liabilities over the cost of business combination is recognized as income in the income statement.
Minority interest at the end of the reporting period, being the portion of the net identifiable assets of subsidiaries attributable to equity interests that are not owned by the Company, whether directly or indirectly through subsidiaries, are presented in the consolidated statement of financial position and statement of changes in equity within equity, separately from equity attributable to the owners of the Company. Minority interest in the results of the Group are presented in the consolidated statement of comprehensive income as an allocation of the comprehensive income for the financial year between minority interest and the owners of the Company.
Where losses applicable to the minority exceed the minority’s interest in the equity of a subsidiary, the excess, and any further losses applicable to the minority, are charged against the Group’s interest except to the extent that the minority has a binding obligation to, and is able to, make additional investment to cover the losses. If the subsidiary subsequently reports profits, the Group’s interest is allocated with all such profits until the minority’s share of losses previously absorbed by the Group has been recovered.
d) Goodwill
Goodwill arises from business combinations and is measured at cost less any accumulated impairment losses. In respect of equity accounted investees, the carrying amount of goodwill is included in the carrying amount of the investment and an impairment loss on such an investment is not allocated to any asset, including goodwill, that forms part of the carrying amount of the equity accounted investee.
For the purpose of carrying out impairment tests, goodwill is allocated to each cash-generating-unit all of which is expected to benefit from the synergies of the business combination, from acquisition date. The subsidiary of the Company is a cash-generating-unit.
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Company No.: 12345-X 20
d) Goodwill (continued)
Impairment test is performed annually. Goodwill is also tested for impairment when any indication of impairment exists. When the recoverable amount of the cash-generating-unit is less than the carrying amount associated to that particular cash-generating-unit, the calculated difference is treated as an impairment loss and is recognized in the income statements. Impairment losses recognized are not reversed in subsequent periods.
Upon the disposal of an interest in a subsidiary, the related goodwill will be included in the computation of gain or loss on disposal of the interest in the subsidiary in profit or loss.
e) Investments
Investments are stated at cost less impairment losses. Where an indication of impairment exists, the carrying amount of the investment is assessed and written down immediately to its recoverable amount. Subsidiary is an entity in which the Company has power to exercise control over the financial and operating policies so as to obtain benefit from its activity.
f) Property, plant, and equipment and depreciation
Property, plant, and equipment are stated at cost less accumulated depreciation and impairment losses. Depreciation is calculated on the straight-line basis to write off the cost of the assets over their estimated useful lives. The principal annual rates used are:
Furniture & fittings 20%
Motor vehicles 20%
Renovation 20%
Office equipment 20%
The carrying values of property, plant, and equipment are reviewed for impairment when events or changes in circumstances indicate that the carrying value may not be recoverable.
The residual value, useful life and depreciation method are reviewed at each financial year-end, and adjusted prospectively, if appropriate.
An item of property, plant, and equipment is derecognized upon disposal or when no future economic benefits are expected from its use or disposal. Any gain or loss on derecognition of the asset is included in the profit or loss in the year the asset is derecognized.
g) Financial assets
The Group and the Company classifies its financial assets into the following categories: at fair value through profit or loss, held-to-maturity investments, loans and receivables, and available-for-sale. The classification depends on the purpose for which the financial assets were acquired. Management determines the classification of its financial assets at initial recognition.
(i) Financial assets at fair value through profit or loss (FVTPL)
Financial assets at fair value through profit or loss are financial assets held for trading. A financial asset is classified in this category if acquired principally for the purpose of selling in the short term. Derivatives are also categorized as held for trading unless they are designated as hedges. Assets in this category are classified as current assets.
(ii) Held-to-maturity investments
Investment in financial assets such as bonds with fixed or determinable payments and fixed maturity dates where the Company has a positive intent and ability to hold to maturity are classified as held-to-maturity investments. Held-to-maturity investments are recorded at amortized cost using the effective interest method less impairment, with revenue recognized on an effective yield basis.
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Company No.: 12345-X 21
g) Financial assets (continued)
(iii) Loans and receivables
Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market. They are included in current assets, except for maturities greater than 12 months after the end of the reporting year. These are classified as non-current assets. The Company’s loans and receivables comprise ‘trade and other receivables’ and cash and cash equivalents in the balance sheet.
(iv) Available-for-sale financial assets
Available-for-sale financial assets are non-derivatives that are either designated in this category or not classified in any of the other categories. They are included in non-current assets unless the investment matures or management intends to dispose of it within 12 months of the end of the reporting year.
Purchases and sales of financial assets are recognized on the trade date – the date on which the Group or the Company commits to purchase or sell the asset. Investments are initially recognized at fair value plus transaction costs for all financial assets not carried at FVTPL. Financial assets carried at FVTPL are initially recognized at fair value, and transaction costs are expensed in the income statement. Financial assets are derecognized when the rights to receive cash flows from the investments have expired or have been transferred and the Group or the Company has transferred substantially all the risk and rewards of ownership.
The Group and the Company assess at each balance sheet date whether there is objective evidence that a financial asset or a group of financial assets is impaired. In the case of equity securities classified as available-for-sale, a significant or prolonged decline in fair value of the security below its cost is considered as an indicator that the securities are impaired. If such evidence exists for available-for-sale financial assets, the cumulative loss, measured as the difference between the acquisition cost and the current fair value, less any impairment loss on that financial asset previously recognized in income statement – is removed from equity and recognized in the income statement. Impairment losses recognized in the income statement on equity instruments are not reversed through the income statement.
h) Financial liabilities
The Group and the Company classifies its financial liabilities into the following categories: at fair value through profit or loss, liabilities from financial guarantees, and other financial liabilities. The classifications depends on the substance of the contractual arrangements entered into and the definitions of a financial liability.
(i) Financial liabilities at fair value through profit or loss
Financial liabilities at fair value through profit or loss include financial liabilities held for trading derivatives (except for a derivative that is a financial guarantee contract or a designated and effective hedging instrument) and financial liabilities designated upon initial recognition as at fair value through profit or loss.
Financial liabilities at fair value through profit and loss are initially measured and recognized at fair values. Subsequent to their initial recognition, financial liabilities at fair value through profit or loss are measured at fair value, with the gain or loss calculated recognized in profit or loss.
The Group and the Company have no financial liabilities at fair value through profit or loss.
(ii) Liabilities from financial guarantees
Financial guarantees represents those contracts that require the Company or entities within the Group as issuer(s) of such guarantees to make specified payments to reimburse the holders for a loss suffered because a specified debtor fails to make payment when due.
Such liabilities are initially recognized as liabilities at fair value, net of the relevant transaction costs. Subsequent to their initial recognition, liabilities from financial guarantees are amortized and recognized in statement of comprehensive income using straight-line method over the contractual period of the guarantees, or when there is no contractual period specified, such liabilities are not amortized but the entire outstanding carrying amounts are recognized in statement of comprehensive income upon discharge of the guarantees.
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Company No.: 12345-X 22
h) Financial liabilities (continued)
(ii) Liabilities from financial guarantees (continued)
When settlement of the liabilities become probable, an estimation of the obligation required to honor the settlement is made and if the amount of the obligation estimated is higher than the carrying amount of the liabilities, the carrying amount is adjusted to arrive at the obligation amount.
(iii) Other financial liabilities
Other financial liabilities include trade payables, other payables, loans, and borrowings.
Trade and other payables are initially recognized at their fair values, net of the transaction costs incurred. Subsequent to their initial recognition, they are measured at amortized cost using effective interest method.
Loans and borrowings are initially recognized at their fair values, net of the transaction costs incurred. Subsequent to their initial recognition, they are measured at amortized cost using effective interest method. Borrowing costs consist of interest on borrowings and other costs that the Group and the Company incurred in the course of borrowing of funds. Borrowing costs directly attributable to the acquisition, construction, or production of qualifying assets, which are assets that necessarily take a substantial period of time to get ready for their intended use or sale, are capitalized as part of the cost of those assets, until such time the assets are substantially ready for their intended use or sale. All other borrowing costs are recognized in profit or loss in the period they are incurred.
Financial liabilities are derecognized when the obligations under the liabilities have been extinguished. When a financial liability is replaced by another liability from the same lender on terms substantially different from the existing liability, or the terms of the existing liability have been substantially modified, such arrangements are treated as derecognitions of the original liabilities and new financial liabilities are recognized. The difference between the carrying amounts of the existing liabilities and the new liabilities are recognized in profit and loss.
h) Offsetting financial instruments
Financial assets and liabilities are offset and the net amount reported in the balance sheet when there is a legally enforceable right to offset the recognized amounts and there is an intention to settle on a net basis, or realize the asset and settle the liability simultaneously.
i) Impairment of financial assets
Financial assets, other than those at fair value through profit or loss, are assessed for indicators of impairment at each balance sheet date. Financial assets are impaired where there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows of the investment have been impacted. For financial assets carried at amortized cost, the amount of the impairment is the difference between the asset’s carrying amount and the present value of estimated future cash flows, discounted at the original effective interest rate.
The carrying amount of the financial asset is reduced by the impairment loss directly for all financial assets with the exception of trade receivables where the carrying amount is reduced through the use of an allowance account. When a trade receivable is uncollectible, it is written off against the allowance account. Subsequent recoveries of amounts previously written off are credited against the allowance account. Changes in the carrying amount of the allowance account are recognized in profit or loss.
With the exception of available-for-sale equity instruments, if, in a subsequent year, the amount of the impairment loss decreases and the decrease can be related objectively to an event occurring after the impairment loss was recognized, the previously recognized impairment loss is reversed through profit or loss to the extent the carrying amount of the investment at the date the impairment is reversed does not exceed what the amortized cost would have been had the impairment not been recognized. In respect of available-for-sale equity instruments, any subsequent increase in fair value after an impairment loss, is recognized directly in equity.
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Company No.: 12345-X 23
j) Impairment of non-financial assets
The carrying amounts of assets are reviewed for impairment when there is an indication that the assets might be impaired. Impairment is measured by comparing the carrying amounts of the assets with their recoverable amounts. The recoverable is the higher of an asset’s net selling price and its value in use, which is measured by reference to discounted future cash flows. Recoverable amounts are estimated for individual assets, or if it is not possible, for the cash-generating unit.
An impairment loss is recognized as an expense in the income statement immediately, unless the asset is carried at a revalued amount. Any impairment loss of a revalued asset is treated as a revaluation decrease to the extent of any unutilized previously recognized revaluation surplus for the same asset. Reversal of impairment losses recognized in prior years is recorded when the impairment losses recognized for the asset no longer exist or have decreased.
k) Income taxes
Income tax expense represents the sum of the current tax and deferred tax.
The current tax is the amount of income taxes payable in respect of the taxable profit for a period. Taxable profit differs from net profit as reported in profit or loss because it excludes items of income or expense that are taxable or deductible in other periods and it further excludes items that are never taxable or deductible. The Group and the Company’s liabilities for current tax are calculated using tax rates that have been enacted or substantively enacted by the reporting date.
Deferred tax is the tax expected to be payable or recoverable on differences between the carrying amount of assets and liabilities in the financial statements and the corresponding tax basis used in the computation of taxable profit, and is accounted for using the liability method. Deferred tax liabilities are generally recognized for all taxable temporary differences and deferred tax assets are recognized to the extent that it is probable that taxable profits will be available against which deductible temporary differences can be utilized. Such assets and liabilities are not recognized if the temporary difference arises from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.
The carrying amount of deferred tax assets is reviewed at each reporting date and reduced to the extent that it is no longer probable that sufficient taxable profit will be available to allow all or part of the asset to be recovered.
Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset realized. Deferred tax is recognized in profit or loss, except when it relates to items recognized directly to equity, in which case the deferred tax is also recognized in equity.
Deferred tax assets and liabilities are offset when they relate to income taxes levied by the same taxation authority and the Group and the Company intend to settle their current tax assets and liabilities on a net basis.
l) Revenue recognition
Revenue is recognized when it is probable that the undermining economic benefits will flow to the Group or the Company and the revenue can be reliably measured. Revenue is measured at the fair value of considerations received. Revenue from services are recognized upon rendering of services. Interest income is recognized on effective interest method.
m) Foreign currencies transactions and balances
(i) Functional and presentation currency
The financial statements of each entity within the Group are presented in the currency of the primary economic environment in which the entity concerned operates, which is the functional currency. For this purpose, the functional currency is Ringgit Malaysia (RM), which is also the presentation currency.
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Company No.: 12345-X 24
m) Foreign currencies transactions and balances (continued)
(ii) Foreign currency transactions and balances (continued)
Transactions in foreign currencies are converted into the respective functional currencies on initial recognition, using the exchange rates approximating those ruling at the transaction dates. Monetary assets and liabilities at the reporting date are translated at the rates ruling as of that date. Non-monetary assets and liabilities are translated using exchange rates that existed when the values were determined. All exchange differences are recognized in profit or loss.
n) Employee benefits
(i) Short-term benefits
Salaries, wages, paid annual leave and sick leave, bonuses and non-monetary benefits are recognized as an expense in the year in which the associated services are rendered by employees of the Group.
(ii) Defined contribution plan
The Group contributions to defined contribution plans are charged to the income statement in the period to which they relate. Once the contributions have been paid, the Company has further liabilities in respect of the defined contribution plans.
o) Leases
All leases entered into by the Group and the Company are in respect of the Group and the Company acting as lessee.
(i) Finance lease
Finance leases, which include hire purchase arrangements are capitalized at the inception of the lease at the fair value of the leased assets or, if the fair value of the leased assets is lower, at the calculated present value of the minimum lease payments. Periodic lease payments are apportioned between the lease interest amounts and the lease principal amounts so as to achieve a constant periodic rate of interest on the remaining balance of the lease liabilities. The lease interest is charged to income statements and recognized as an expense whereas the lease principal amounts calculated from the periodic lease payments are treated as a reduction to the lease liability.
(ii) Operating lease
Operating lease payments are recognized as lease rental expense in the income statements on a straight-line basis over the period of the lease. The aggregate amount of incentives provided by the lessor, if any, is recognized as a reduction of the lease rental expense over the period of the lease on a straight-line basis.
p) Segment reporting
All the entities within the Group are principally operating in the same geographical area i.e. in Malaysia and in the same operating segment, namely provision of forwarding and warehousing services and therefore additional information on the profit or loss, assets and liabilities of different geographical areas and different operating segments are not presented.
q) Contingencies
A contingent liability or asset is a possible obligation or asset that arises from past events in which its existence will be confirmed only by the occurrence or nonoccurrence of uncertain future event or events not holly within the control of the Group or the Company.
3. FINANCIAL RISK MANAGEMENT POLICIES
The Group's financial risk management policy seeks to ensure that adequate financial resources are available for the development of the Group's business while managing its risks. The Group operates within defined guidelines that are approved by the Board of Directors and does not engage in speculative transactions. The policies in respect of the major areas of treasury activity are as follows:
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Company No.: 12345-X 25
3. FINANCIAL RISK MANAGEMENT POLICIES (CONTINUED)
a) Foreign currency risk
The Group is exposed to foreign currency risk as a result of its normal trading activities where the currency denomination differs from the local currency, Ringgit Malaysia (RM), primarily with respect to the U.S. dollar. The Group policy is to minimize the exposure of its foreign currency risk to not exceeding RM50,000 at any particular point in time, by engaging in the required forward currency contracts as the hedging instruments. As at the end of the financial year, no forward currency contracts were engaged as there was no such necessity. To arrive at such conclusion, a fluctuation of 1% of U.S. dollar against RM will result in foreign currency risk exposure of lesser than RM3,000 which is deemed insignificant as to its impact to the financial results and financial position of the Group and of the Company.
b) Cash flow and Interest rate risk
Borrowings at variable rates expose the Group to cash flow interest rate risk whereas borrowings at fixed rates expose the Group to fair value interest rate risk. The Group's interest rate risk arises mainly from its borrowings and hire purchase and lease payables. Such exposure is partially reduced by the interest income derived from its placement in fixed deposits. The Group monitors its exposure to such risk to ensure that its net interest cost does not exceed 10% of its profit before-tax and also to ensure regular monthly cash flows are sufficient to meet its borrowings' repayment requirement.
The Management is of the opinion that the current economic conditions do not warrant an unlikely substantial hike in interest rates causing an adverse financial impact on the Group and the Company. Based on the financial position of the Group as a 31 December 2010, on the assumption that there is a hike of 10 basis points of market interest rate with all other variables remained constant, the after-tax profit of the Group would have been RM35,000 lower and the equity component of the Group would have a similar RM35,000 reduction.
c) Credit risk
The Group's exposure to credit risk arises mainly from receivables. The Group manages its exposure by the application of the credit approvals, credit limits, and monitoring procedure on an ongoing basis. The Group's major concentration of credit risk related to debt owing by four trade receivables that constituted approximately 72% of net receivables at the end of the financial year.
d) Liquidity risk
The Group's exposure to liquidity and cash flow risks mainly from general funding and business activities. It practices prudent liquidity risk management by maintaining sufficient cash balances and the availability of funding through certain committed credit facilities. The management seeks to achieve a balance between certainty of funding so as to ensure that all repayments and funding needs are met.
e) Capital risk management
The Company manages its capital to ensure that the Company will be able to continue as a going concern while maximizing the return to stakeholders through the optimization of the debt and equity balance. The Company will balance its overall capital structure through the payment of dividends, new share issues and the issue of new debt or the redemption of debt. The Directors monitor and determine an optimal debt-to-equity ratio that complies with debt covenants and regulatory requirements.
During the financial year, the Group’s strategy, which was unchanged from 31 December 2009, was to maintain the debt-to-equity ratio below 1. The debt-to-equity ratios at 31 December 2010 and 31 December 2009 were calculated as follows:
Group Company
2010 2009 2010 2009
Non-current liabilities which represent Long-term debt (A) 512,000 140,000 512,000 140,000
Total equity (B) 11,158,100 9,260,000 12,385,000 9,363,000
Debt-to-equity ratio (A)/(B) 0.046 0.015 0.041 0.015
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Company No.: 12345-X 28
6. AVAILABLE-FOR-SALE FINANCIAL ASSETS
GROUP / COMPANY
2010 2009
RM RM
At fair value:
Golf club membership 66,000 13,000
This represents golf club membership owned by the Group for the usage by its CEO for business purposes and there is actively traded market prices available for this type of membership. There was no significant difference in the fair value as at the reporting date compared to the carrying value stated and hence no adjustment was made for fair value differences.
7. INVESTMENT IN ASSOCIATED COMPANY
GROUP COMPANY
2010 2009 2010 2009
RM RM RM RM
At cost:
Unquoted shares 300,000 - 300,000 -
Share of post-acquisition profits 2,000,000 - - -
2,300,000 - 300,000 -
Ownership equity interest Principal Place of
Name of associated company 2010 2009 activity incorporation
MNO Sdn. Bhd. 30% Nil Forwarding Malaysia
and warehouse
services
The summarized financial information of the associated company (not adjusted for the proportion ownership interest of the Group in this associated company) is as follows:
GROUP
2010 2009
RM RM
Financial position:
Total assets 8,650,245 1,546,789
Total liabilities (983,578) (546,789)
Net assets 7,666,667 1,000,000
Financial results:
Turnover 23,456,890 3,350,980
Total comprehensive income for the year 6,666,667 230,953
8. INVESTMENT IN SUBSIDIARY COMPANY
On 1 August 2010, the Company acquired a 55% equity interest in JKL Sdn. Bhd. for a cash consideration RM54,900. This subsidiary is principally engaged in the provision of forwarding and warehousing services and is incorporated in Malaysia.
The acquisition had the following effect on the Group's financial results for the year:
2010
RM
Revenue 2,200,000
Cost of sales (1,700,000)
Gross profit 500,000
Other operating income 23,000
Operating and administrative expenses (540,000)
Net loss for the year (17,000) Click To Go Back To Guide To Use Of Worksheets
Company No.: 12345-X 29
8. INVESTMENT IN SUBSIDIARY COMPANY (CONTINUED)
The acquisition had the following effect of increase on the net assets of the Group as at the end of the year as follows:
2010
RM
Property, plant, and equipment 1,500
Receivables 10,700,000
Fixed deposits with a licensed bank 340,000
Cash and bank balances 2,184,000
Payables (5,400,000)
Increase in Group net assets 7,825,500
The fair values of the assets acquired and liabilities assumed, from the subsidiary on 1 August 2010 were as follows:
2010
RM
Property, plant, and equipment 3,000
Receivables 124,000
Cash and bank balances 20,000
147,000
Payables 109,000
Fair value of net assets 38,000
Less: Portion attributable to minority interest (17,100)
Group's share of net assets 20,900
Goodwill on acquisition 34,000
Total cost of acquisition 54,900
The cash outflow on acquisition is as follows:
2010
RM
Purchase consideration satisfied by cash 54,900
Cash and cash equivalents of subsidiary acquired (20,000)
Net cash outflow of the Group 34,900
The financial statements of the subsidiary company were audited by another firm of chartered accountants.
9. TRADE RECEIVABLES
GROUP COMPANY
2010 2009 2010 2009
RM RM RM RM
Trade receivables
Related parties
- Associated company (Note 10) 550,000 - 150,000 -
- Subsidiary company (Note 11) - - 25,000 -
Non-related parties 20,500,000 19,469,000 20,000,000 19,469,000
Less : Impairment loss
Related parties
- Associated company - - - -
- Subsidiary company - - - -
Non-related parties (73,000) (87,000) (73,000) (87,000)
20,977,000 19,382,000 20,102,000 19,382,000
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Company No.: 12345-X 30
9. TRADE RECEIVABLES (CONTINUED)
Trade receivables are not interest-bearing and are not secured. The credit period of trade receivables range from 30 days to 90 days.
The aging analysis of trade receivables are as follows:
GROUP COMPANY
2010 2009 2010 2009
RM RM RM RM
Aging analysis
Neither past due nor impaired
1 to 30 days 7,016,600 6,489,000 6,725,000 6,489,000
30 days to 60 days 9,282,700 8,567,000 10,014,500 8,567,000
60 days to 90 days 4,677,700 4,326,000 3,362,500 4,326,000
Past due but not impaired - - - -
Past due and impaired 73,000 87,000 73,000 87,000
21,050,000 19,469,000 20,175,000 19,469,000
a) Trade receivables neither past due nor impaired
Trade receivables that are neither past due nor impaired are debtors with excellent payment records and have been customers of the Group and of the Company for more than 3 years.
There are no trade receivables under neither past due nor impaired category renegotiated during the year.
b) Trade receivables past due and impaired
The trade receivables past due and impaired with the movement in the respective allowance for impairment loss are analyzed as follows:
GROUP COMPANY
2010 2009 2010 2009
RM RM RM RM
Outstanding amount 73,000 87,000 73,000 87,000
Allowance for impairment loss (73,000) (87,000) (73,000) (87,000)
- - - -
The above receivables represents total of receivables individually impaired. These represent those debtors that are in financial difficulties and have defaulted on payments, and have been individually determined by the Management to be impaired. There was no receivables collectively impaired.
The movement in the allowance for impairment loss is as follows:
GROUP/COMPANY
2010 2009
RM RM
At beginning of year 87,000 -
Charge for the year - 802,000
Write off (14,000) (715,000)
At end of year 73,000 87,000
10. AMOUNT DUE FROM ASSOCIATED COMPANY
The amount due from associated company is trade in nature and arose from trade transactions conducted with the Company. The terms of the transactions entered into are similar with those entered into with non-related parties. The amount due from associated company has been eliminated for the purpose of preparing consolidated financial statements.
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Company No.: 12345-X 31
11. AMOUNT DUE FROM SUBSIDIARY COMPANY
The amount due from subsidiary company is trade in nature and arose from trade transactions conducted with the Company. The terms of the transactions entered into are similar with those entered into with non-related parties. The amount due from associated company has been eliminated for the purpose of preparing consolidated financial statements.
12. FIXED DEPOSITS WITH LICENSED BANKS
The fixed deposits are pledged to banks as security for banking facilities granted to the Company. Its effective interest rate as at balance sheet date was 3% ( 2009: 3%) per annum.
13. OTHER PAYABLES AND ACCRUALS
GROUP COMPANY
2010 2009 2010 2009
RM RM RM RM
Sundry payables 1,300,000 - 20,000 -
Accruals 142,000 150,000 112,000 150,000
Liability from financial guarantee 8,000 - 8,000 -
Advance payments from customers 540,000 400,000 500,000 400,000
1,990,000 550,000 640,000 550,000
Liability from financial guarantee is in respect of corporate guarantee to a licensed bank for a RM300,000 Long Term Loan facility made available to the subsidiary company.
14. HIRE PURCHASE AND FINANCE LEASE PAYABLES
GROUP / COMPANY
2010 2009
RM RM
Minimum hire purchase and finance lease payments:
Not later than 1 year 35,000 40,000
Later than 1 year and not later than 2 years 30,000 35,000
Later than 2 years and not later than 5 years 80,000 110,000
145,000 185,000
Less: Future finance charges (15,000) (20,000)
Present value of hire purchase and finance lease liabilities 130,000 165,000
Present value of hire purchase and finance lease liabilities:
Not later than 1 year 30,000 30,000
Later than 1 year and not later than 2 years 25,000 25,000
Later than 2 years and not later than 5 years 75,000 110,000
130,000 165,000
Analyzed as:
Due within 12 months included in current liabilities 30,000 30,000
Due after 12 months included in non-current liabilities 100,000 135,000
130,000 165,000
The effective interest rates on the hire purchase payables and finance lease payables as at the balance sheet date were 4% (2009 : 4%) and 9% (2009 : 9%) per annum, respectively.
15. BANK BORROWINGS
GROUP / COMPANY
2010 2009
RM RM
SECURED
Bank overdraft 300,000 140,000
Term loans (amount repayable within the next 12 months) 150,000 -
Total bank borrowings included in current liabilities 450,000 140,000
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Company No.: 12345-X 32
15. BANK BORROWINGS (CONTINUED)
GROUP / COMPANY
2010 2009
RM RM
Analysis of term loans repayment:
- Within 2 years 250,000 -
- Between 2 to 5 years 300,000 -
- More than 5 years - -
550,000 -
Less: Amount repayable within the next 12 months (150,000) -
Included under non-current liabilities 400,000 -
The above facilities are secured by:
(i) fixed deposits of the Company;
(ii) corporate guarantee of Credit Guarantee Corporation Berhad;
(iii) corporate guarantee of the Company;
(iv) joint and several guarantees by certain directors of the Company.
Covenants
(i) the Group shall maintain a debt-to-equity ratio of not exceeding 1.5 at all time.
(ii) the Company shall not declare dividends to its shareholders exceeding 10% of its issued and fully paid up capital.
The effective interest rates as at the balance sheet date were as follows:
GROUP / COMPANY
2010 2009
% %
Bank overdraft 6.00 5.00
Term loans 5.50 -
16. SHARE CAPITAL
GROUP / COMPANY
RM RM
Authorized:
5,000,000 ordinary shares of RM1 each 5,000,000 5,000,000
Issued and fully paid:
5,000,000 ordinary shares of RM1 each 5,000,000 5,000,000
17. DEFERRED TAX LIABILITIES
GROUP / COMPANY
2010 2009
RM RM
At 1 January 5,000 9,000
Recognized in income statement (Note 20) 7,000 (4,000)
At 31 December 12,000 5,000
The deferred tax liabilities are in respect of the temporary differences on the excess of carrying values of property, plant, and equipment over their tax bases.
18. REVENUE
Revenue of the Group and of the Company represents invoiced value of services rendered less discounts.
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Company No.: 12345-X 33
19. PROFIT BEFORE TAXATION
Profit before taxation is arrived at after charging/(crediting) the following:
GROUP COMPANY
2010 2009 2010 2009
RM RM RM RM
Auditors' remuneration 85,000 85,000 85,000 85,000
Impairment of trade receivables - 802,000 - 802,000
Depreciation 126,000 125,000 125,000 125,000
Directors' emoluments 3,250,000 450,000 3,150,000 450,000
Fixed deposit interest (150,000) (30,000) - (30,000)
Interest expense:
-bank overdraft 185,000 98,000 185,000 98,000
-leasing 2,000 2,000 2,000 2,000
-hire purchase 3,000 3,000 3,000 3,000
-term loan 125,000 - 125,000 0 -
(Gain) / loss on foreign exchange:
- realized (130,000) 250,000 (130,000) 250,000
- unrealized 102,000 (90,000) 102,000 (90,000)
Rent of premises 600,000 600,000 350,000 400,000
Staff costs representing employee benefits expense:
- Wages and salaries 7,000,000 9,000,000 5,500,000 9,000,000
- Employees Provident Fund (Contribution to defined contribution plan)
885,000 991,000 785,000 991,000
- Social security contribution 12,000 9,000 5,000 9,000
7,897,000 10,000,000 6,290,000 10,000,000
Share of post acquisition profits in
associated company (2,300,000) - - -
20. TAXATION
GROUP COMPANY
2010 2009 2010 2009
RM RM RM RM
Current taxation:
Current year provision
- the Company & subsidiary company 1,502,000 2,200,000 1,500,000 2,200,000
- the associated company 300,000 - - -
Deferred taxation (Note 17):
Current year provision
- the Company & subsidiary company 7,000 (4,000) 7,000 (4,000)
1,809,000 2,196,000 1,507,000 2,196,000
A reconciliation of income tax expenses applicable to profit before taxation at the statutory income tax rate to income tax expense at the effective income tax rate of the Company is as follows:
GROUP COMPANY
2010 2009 2010 2009
RM RM RM RM
Profit before taxation 3,690,000 6,159,000 4,529,000 6,159,000
Taxation at statutory tax rate of 25% (2009 : 25%) 922,500 1,539,750 1,132,250 1,539,750
Share of current year tax in associated company 300,000 - - -
Expenses not deductible for tax
purposes 586,500 682,000 453,500 682,000
Tax expense for the year 1,809,000 2,221,750 1,585,750 2,221,750
Subject to agreement of the Inland Revenue Board, the Company has sufficient tax credit under Section 108 of the Income Tax Act, 1967 to distribute its entire retained profits as dividends without incurring additional tax liability.
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Company No.: 12345-X 34
21. CONTINGENT LIABILITIES
During the financial year, a creditor commenced legal action against the Company in respect of work completed but remained unpaid. The estimated amount that the Company may need to pay should the creditor's claim is successful is approximately RM100,000. The Directors claimed that the work done was substandard, not done within the agreed timeframe, and in fact, resulted in additional costs incurred for subsequent follow-up work and therefore made a counter-claim of RM120,000 for the additional costs incurred.
The Directors have been advised by the legal counsel of the Company and are of the opinion that provisions are not required in respect of this legal claim as it is not probable that the creditor's claim will be successful and hence no provision has been made in respect of this contingent liability in the financial statements.
21. FINANCIAL INSTRUMENTS BY CATEGORY
GROUP COMPANY
2010 2009 2010 2009
RM RM RM RM
Financial assets
Financial assets at fair value through profit or loss (FVTPL) - - - -
Held-to-maturity investments - - - -
Loan and receivables:
Trade receivables 20,977,000 19,382,000 20,102,000 19,382,000
Other receivables, deposits, & prepayments 2,013,540 487,000 550,000 487,000
Tax recoverable 13,450 - 2,000 -
Fixed deposits with a licensed bank 4,120,000 300,000 500,000 300,000
Cash and bank balances 2,184,000 600,000 220,000 600,000
29,307,990 20,769,000 21,374,000 20,769,000
Available-for-sale financial assets 66,000 13,000 66,000 13,000
29,373,990 20,782,000 21,440,000 20,782,000
Financial liabilities
Financial liabilities at fair value through profit or loss - - - -
Liabilities from financial guarantees 8,000 - 8,000 -
Other financial liabilities
Trade payables 18,069,890 10,847,000 8,695,900 10,847,000
Other payables and accruals 1,982,000 550,000 632,000 550,000
Hire purchase and finance lease payables 130,000 165,000 130,000 165,000
Bank borrowings 850,000 140,000 850,000 850,000
Taxation - 100,000 - 100,000
21,031,890 11,802,000 10,307,900 12,512,000
21,039,890 11,802,000 10,315,900 12,512,000
The Group and the Company do not have financial assets or liabilities carried at fair value, by valuation method.
22. RELATED PARTIES
Identity of related parties
For the purposes of these financial statements, parties are considered to be related to the Group or the Company if the Group or the Company has the ability, directly or indirectly, to control the party or exercise significant influence over the party in making financial and operating decisions, or vice versa, or where the Group or the Company and the party are subject to common control or common significant influence. Related parties may be individuals or other entities.
Key management personnel are defined as those persons having authority and responsibility for planning, directing, and controlling the activities of the Group either directly or indirectly. The key management personnel include all the Directors of the Group.
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Company No.: 12345-X 35
22. RELATED PARTIES (CONTINUED)
Related party transactions
The following significant related party transactions took place at terms between the Group or the Company with the related parties during the financial year:-
GROUP COMPANY
2010 2009 2010 2009
RM RM RM RM
a) Sale and purchase of goods and services
Services rendered to:
- Associated company - - 550,000 -
- Subsidiary company - - 350,000 -
b) Compensation of key management personnel
Short-term employee benefits representing remuneration paid to the directors
3,250,000 450,000 3,150,000 450,000
Lodged by: GOOD COMPANY SECRETARIAL SERVICES SDN. BHD.
28, Jalan SS1/38,
33333 Wonderland,
Tel : 03-77277277 Click To Go Back To Guide To Use Of Worksheets
Company No.: 12345-X
ABC SDN. BHD.
(Incorporated in Malaysia)
DETAILED INCOME STATEMENT FOR THE YEAR ENDED
31 December 2010
2010 2009
RM RM
REVENUE 121,592,000 200,062,000
LESS: COST OF REVENUE
Direct subcontracting costs 101,023,000 173,409,000
Other direct costs 2,911,000 5,091,000
103,934,000 178,500,000
GROSS PROFIT 17,658,000 21,562,000
OTHER INCOME
Fixed deposit interest - 30,000
Gain on foreign exchange:
- realized 130,000 -
- unrealized - 90,000
130,000 120,000
17,788,000 21,682,000
OPERATING AND ADMINISTRATIVE EXPENSES (Appendix A) (13,259,000) (15,523,000)
FINANCE COSTS (Appendix B) (315,000) (103,000)
PROFIT FOR THE YEAR 4,214,000 6,056,000
The Detailed Income Statement is presented for management purposes only and does not form part of the financial statements. Click To Go Back To Guide To Use Of Worksheets
Company No.: 12345-X
ABC SDN. BHD.
(Incorporated in Malaysia)
(Appendix A)
OPERATING AND ADMINISTRATIVE EXPENSES FOR THE YEAR ENDED
31 December 2010
2010 2009
RM RM
Advertisement 14,000 13,000
Attestation fee - 1,000
Auditors' remuneration 85,000 85,000
Allowance for doubtful debts - 802,000
Bank charges 76,000 40,000
Depreciation 125,000 125,000
Directors' emoluments 3,150,000 450,000
Discount on disposal of plant and equipment - (20,000)
Electricity & water 201,000 260,000
Entertainment 370,000 210,000
EPF & SOCSO 790,000 1,000,000
Gift & donation 103,000 120,000
Insurance 400,000 400,000
Legal & professional fee 140,000 10,000
License fee 90,000 80,000
Loss on foreign exchange:
- realized - 250,000
- unrealized 102,000 -
Management fee 150,000 300,000
Medical fee 60,000 130,000
Penalty 50,000 4,000
Printing, stationery, & postages 350,000 400,000
Rent of premises 600,000 600,000
Road tax & insurance 90,000 90,000
Salaries, bonus & overtime 5,500,000 9,000,000
Secretarial fees & disbursements 10,000 23,000
Service tax 4,000 3,000
Staff amenities 100,000 205,000
Subscription fee 76,000 40,000
Balance carried forward 12,636,000 14,621,000
The Detailed Income Statement is presented for management purposes only and does not form part of the financial statements. Click To Go Back To Guide To Use Of Worksheets
Company No.: 12345-X
ABC SDN. BHD.
(Incorporated in Malaysia)
(Appendix A)
OPERATING EXPENSES FOR THE YEAR ENDED
31 December 2010
2010 2009
RM RM
Balance brought forward 12,636,000 14,621,000
Tax compliance fee 21,000 19,000
Telephone & fax charges 82,000 71,000
Training 50,000 80,000
Travelling & accommodation 350,000 450,000
Upkeep of motor vehicles 92,000 71,000
Upkeep of office 13,000 81,000
Upkeep of office equipment 15,000 130,000
13,259,000 15,523,000
(Appendix B)
FINANCE COSTS FOR THE YEAR ENDED
31 December 2010
2010 2009
RM RM
Interest expense:
-bank overdraft 185,000 98,000
-leasing 2,000 2,000
-hire purchase 3,000 3,000
-term loan 125,000 -
315,000 103,000
The Detailed Income Statement is presented for management purposes only and does not form part of the financial statements. Click To Go Back To Guide To Use Of Worksheets
Company No.: 12345-X
ABC SDN. BHD.
(Incorporated in Malaysia)
REPORTS AND FINANCIAL STATEMENTS
31 December 2010
These Audited Statements of Account of the Company with Qualified/Unqualified Auditor's Report for the year / period ended 31/12/2010 were tabled at the Annual General Meeting or Adjourned General Meeting held on
Director : ABDUL BIN MALEK
DEF & CO. (AF 1234)
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AuditorsReportPg5

5
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF
ABC SDN. BHD. (12345-X)
(Incorporated in Malaysia)
Report on the Financial Statements
We have audited the financial statements of ABC Sdn. Bhd., which comprise the statement of financial position as at 31 December 2010, and statement of comprehensive income, statement of changes in equity and statement of cash flows of the Group and of the Company for the year then ended, and a summary of significant accounting policies and other explanatory notes, as set out on pp. 7 to 35.
Directors' Responsibility for the Financial Statements
The directors of the Group and of the Company are responsible for the preparation and fair presentation of these financial statements in accordance with Financial Reporting Standards and the Companies Act 1965 in Malaysia. This responsibility includes: designing, implementing, and maintaining internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error; selecting and applying appropriate accounting policies; and making accounting estimates that are reasonable in the circumstances.
Auditors' Responsibility
Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with approved standards on auditing in Malaysia. Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance whether the financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on our judgment, including the assessment of risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, we consider internal control relevant to the Company's preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by the directors, as well as evaluating the overall presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.
Opinion
In our opinion, the financial statements have been properly drawn up in accordance with Financial Reporting Standards and the Companies Act 1965 in Malaysia so as to give a true and fair view of the financial position of the Group and of the Company as of 31 December 2010 and of its financial performance and cash flows for the year then ended.
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AuditorsReportPg6

6
Report on Other Legal and Regulatory Requirements
In accordance with the requirements of the Companies Act 1965 in Malaysia, we also report the following:
a) In our opinion, the accounting and other records and the registers required by the Act to be kept by the Company have been properly kept in accordance with the provisions of the Act. The auditors of the subsidiary company have expressed an opinion that such records and register books of the subsidiary company have been properly kept.
b) We have considered the financial statements and the auditors' report of the subsidiary of which we have not acted as auditors, which are indicated in Note 8 to the financial statements.
c) We are satisfied that the financial statements of the subsidiary that have been consolidated with the Company's financial statements are in form and content appropriate and proper for the purposes of the preparation of the financial statements of the Group and we have received satisfactory information and explanations required by us for those purposes.
d) The audit report on the financial statements of the subsidiary did not contain any qualification or any adverse comment made under Section 174(3) of the Act.
Other Matters
This report is made solely to the members of the Company, as a body, in accordance with Section 174 of the Companies Act 1965 in Malaysia and for no other purpose. We do not assume responsibility to any other person for the content of this report.
DEF & CO.
No. AF 1234
Chartered Accountants
DANNY ALFANSO FERRER
No. 1234/10/12 (J)
Chartered Accountant
Dated:
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Note-PPE

Company No.: 12345-X 26
4. CRITICAL ACCOUNTING ESTIMATES, JUDGMENTS, AND KEY SOURCES OF ESTIMATION UNCERTAINTY
(i) Critical accounting estimates & judgments
In the process of applying the accounting policies, Management has made the following judgments, apart from those involving estimations, which have the most significant effect on the amounts recognized in the financial statements:-
a) Impairment of receivables
An impairment loss is recognized when there is objective evidence that a financial asset is impaired. Management specifically reviews its loans and receivables financial assets and analyzes historical bad debts, customer concentrations, customer creditworthiness, current economic trends, and changes in the customer payment terms when making a judgment to evaluate the adequacy of the allowance for impairment losses. Where there is objective evidence of impairment, the amount and timing of future cash flows are estimated based on historical loss experience for assets with similar credit risk characteristics. If the expectation is different from the estimation, such difference will impact the carrying value of receivables.
b) Income taxes
There are certain transactions and computations for which the ultimate tax determination may be different from the initial estimate. The Group recognizes tax liabilities based on its understanding of the prevailing tax laws and estimates of whether such taxes will be due in the ordinary course of business. Where the final outcome of these matters is different from the amounts that were initially recognized, such difference will impact the income tax and deferred tax provisions in the period in which such determination is made.
(ii) Key sources of estimation uncertainty
a) Useful lives of property, plant, and equipment
Items of property, plant, and equipment are depreciated on straight-line basis over the assets' estimated economic useful lives of 5 years or 20% depreciation rate per annum. This is the Management's estimation of useful lives of the items of property, plant, and equipment of the Group and of the Company. This estimation is based on the Management's past experience and also considered the common economic life expectancies applied by other entities in the same industry. Changes in the expected level of usage and technological advancement could impact the useful lives and the residual values of the assets, and therefore future revision in depreciation charges could be made by the Management.
5. PROPERTY, PLANT, AND EQUIPMENT
Furniture Motor Office
& fittings vehicles Renovation equipment Total
COMPANY RM RM RM RM RM
2010
COST
1 January 175,000 250,000 115,000 15,000 555,000
Additions 125,000 - 200,000 15,000 340,000
31 December 300,000 250,000 315,000 30,000 895,000
ACCUMULATED
DEPRECIATION
1 January 105,000 90,000 70,000 5,000 270,000
Charge for the year 35,000 50,000 30,000 10,000 125,000
31 December 140,000 140,000 100,000 15,000 395,000
NET BOOK VALUE
AS AT 31 DECEMBER 2010 160,000 110,000 215,000 15,000 500,000
NET BOOK VALUE
AS AT 31 DECEMBER 2009 70,000 160,000 45,000 10,000 285,000
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Company No.: 12345-X 27
5. PROPERTY, PLANT AND EQUIPMENT (CONTINUED)
GROUP
2010
COST
1 January 175,000 250,000 115,000 15,000 555,000
Additions 128,000 - 200,000 15,000 343,000
31 December 303,000 250,000 315,000 30,000 898,000
ACCUMULATED
DEPRECIATION
1 January 105,000 90,000 70,000 5,000 270,000
Charge for the year 36,000 50,000 30,000 10,000 126,000
31 December 141,000 140,000 100,000 15,000 396,000
NET BOOK VALUE
AS AT 31 DECEMBER 2010 162,000 110,000 215,000 15,000 502,000
NET BOOK VALUE
AS AT 31 DECEMBER 2009 70,000 160,000 45,000 10,000 285,000
Motor vehicles with net book value of RM100,000 (2009 : RM170,000) were acquired under hire purchase installment plans.
Office equipment with net book value of RM5,000 (2009 : RM8,000) were acquired under finance lease installment plan.
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