Attached files
| file | filename |
|---|---|
| 8-K/A - FORM 8K/A NO.1 - Median Group Inc | r8ka-061412cmg.htm |
| EX-99 - PROFORMA FINANCIAL STATEMENTS - CHINA MEDIA GROUP CORP - Median Group Inc | ext992a-061412cmg.htm |
Exhibit 99.1 |
A-TEAM RESOURCES SDN. BHD.
FINANCIAL STATEMENTS
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2011
Exhibit 99.1 |
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| Independent Auditors' Report | F -1 |
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| Balance Sheets | F - 2 |
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| Statement of Income | F - 3 |
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| Statement of Shareholders' Equity | F - 4 |
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| Statement of Cash Flows | F - 5 |
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| Notes to the Financial Statements | F - 6 - F-26 |
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Exhibit 99.1 |
REPORT OF INDEPENDENT AUDITORS |
THE BOARD OF DIRECTORS AND SHAREHOLDERS OF |
A-TEAM RESOURCES SDN. BHD. (Company No. : 639284 - M) |
We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. We were not engaged to perform an audit of the Company's internal control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis for designing 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 over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. In our opinion, the financial statements referred to
above present fairly, in all material respects, the financial position of A-Team Resources
Sdn. Bhd. at 31st December 2011 and 31st December 2010, and the results of its operations
and its cash flows for the years then ended in conformity with U.S. generally accepted
accounting principles. |
E. S. Lim & Co. |
Chartered Accountants |
| Kuala Lumpur, Malaysia |
| 31st May 2012 |
Page F - 1
Exhibit 99.1 |
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Page F - 2
Exhibit 99.1 |
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Page F - 3
Exhibit 99.1 |
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Share |
Comprehensive Income |
Retained earnings |
Total |
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| USD | USD | USD | USD | ||||
| At 1 January 2010 | 583,107 |
2,461 |
767,942 |
1,353,510 |
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| Currency translation adjustment | - |
155,439 |
- | 155,439 | |||
| Total comprehensive income for the financial year | - |
- |
71,390 |
71,390 |
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| At 31 December 2010 | 583,107 |
157,900 |
839,332 | 1,580,339 | |||
| Currency translation adjustment | - |
(51,442) |
- | (51,442) | |||
| Total comprehensive income for the financial year | - |
- |
355,678 | 355,678 | |||
| At 31 December 2011 | 583,107 |
106,458 |
1,195,010 | 1,884,575 | |||
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Page F - 4
Exhibit 99.1 |
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| Note | 2011 |
2010 |
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| CASH FLOW FROM OPERATING ACTIVITIES | ||||
| Profit before tax | 483,625 |
92,921 |
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| Adjustment for : | ||||
| Depreciation | 64,835 |
60,229 |
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| Bad debts written off | - |
1,359 |
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| Waiver of non-trade liabilities | - |
(4,468) |
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| Net gain on disposal of property, plant and equipment | (11,364) |
- |
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| Trade and other receivables | (39,232) |
(635,111) |
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| Trade and other payables | (107,106) |
5,199 |
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| Amount owing to Directors | 67,639 |
(62,245) |
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| Net income tax refunded/(paid) | - |
(20,047) |
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| Restricted cash | (8,014) |
567,424 |
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| Net cash flow from operating activities | 450,383 |
5,261 |
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| CASH FLOW FROM INVESTING ACTIVITIES | ||||
| Purchase of property, plant and equipment | 6 |
(4,753) |
(22,323) |
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| Proceeds from disposal of property, plant and equipment | 42,813 |
- |
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| Net cash flow from/(used in) investing activities | 38,060 |
(22,323) |
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| CASH FLOW FROM FINANCING ACTIVITIES | ||||
| Net repayments of trade financing payables | (524,059) |
(253,783) |
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| Term loans arising from rearrangement | 567,519 |
112,665 |
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| Repayment of term loans | (263,497) |
(975) |
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| Repayment of finance leases | (68,968) |
(24,471) |
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| Interest paid | 47,567 |
7,605 |
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| Net cash flow used in financing activities | (241,438) |
(158,959) |
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| NET INCREASE/(DECREASE ) IN CASH AND CASH EQUIVALENTS | 247,005 |
(176,021) |
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| Effect on exchange rate changes | (52,749) |
142,520 |
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| CASH AND CASH EQUIVALENTS AT THE BEGINNING OF THE YEAR | (170,264) | (136,763) | ||
| CASH AND CASH EQUIVALENTS AT THE END OF THE YEAR | 3 |
23,992 |
(170,264) |
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| Supplemental disclosures of cash flow information | ||||
| Net income tax paid | - |
20,047 |
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| Interest paid | 26,352 |
94,387 |
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Page F - 5
Exhibit 99.1 |
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1. |
CORPORATE INFORMATION |
In 2004, the Company carried out the business at Lot 1774, Jalan Balakong, Bukit Belimbing, 43300 Seri Kembangan, Selangor Darul Ehsan, Malaysia. In 2005, the shareholders had increased the paid up capital to USD 116,621 (RM400,000) divided into 400,000 unit shares. In 2006, the Company moved to Shah Alam, Selangor Darul Ehsan, Malaysia due to expansion. Now the Company is located at Telok Gong, Klang, Selangor Darul Ehsan, Malaysia with a paid-up capital of USD 583,107(RM2,000,000) divided into 2,000,000 unit shares. The key management personnel is Mr. BB Ng who has never failed to yield wealth to the shareholders even in economical crisis. The Company will continue to maximize the return for the shareholders. The registered office of the Company is located at No. 24A (Room 1), Jalan 21/19, SEA Park, 46300 Petaling Jaya, Selangor Darul Ehsan. |
2. |
SIGNIFICANT ACCOUNTING POLICIES |
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2.1 |
(a) Basis of Presentation |
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(b) Use of Estimates |
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The preparation of the Company's financial statements in conformity with US GAAP, requires management to make judgements, estimates and assumptions that affect the reported amounts of revenues, expenses, assets and liabilities, and the disclosure of contingent assets and liabilities at the reporting date and the reported amounts of revenues and expenses during the reporting periods. The management makes these estimated using the best information available at the time the estimates are made; however actual results could differ materially from those estimates. |
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Page F - 6
Exhibit 99.1 |
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2. |
SIGNIFICANT ACCOUNTING POLICIES (Continued) |
2.2 |
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| Motor vehicles | 10-20 |
| Furniture and fittings | 20 |
| Office equipment | 20-60 |
| Mould | 20 |
| Renovation | 20 |
2.3 |
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2.4 |
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The Company's banking facilities are secured by deposits with financial institutions amounted to USD 57,395 (2010 : USD 49,381). These deposits are presented as "restricted cash" in the Company's balance sheet. |
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2.5 |
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| The Company's operations are conducted in Malaysia. Accordingly, the Company's business, financial condition and results of operations may be influenced by the political, economic and legal environment in Malaysia, and by general state of Malaysia economy. | ||
2.6 |
Borrowing Costs |
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Page F - 7
Exhibit 99.1 |
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2. |
SIGNIFICANT ACCOUNTING POLICIES (Continued) |
2.7 |
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(a) |
Finance Lease |
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Leased assets are depreciated over the estimated useful life of the asset. However, if there is no reasonable certainty that the Company will obtain ownership by the end of the lease term, the asset is depreciated over the shorter of the estimated useful life and the lease term. |
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(b) |
Operating Lease |
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Operating lease payments are recognised as an expense in statement of income on a straight-line basis over the lease term. The aggregate benefit of incentives provided by the lessor is amortised as a reduction of rental expense over the lease term on a straight-line basis. |
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2.8 |
Income Taxes |
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(a) |
Current Tax |
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Current taxes are recognised in the statement of income except to the extent that the tax relates to items recognised outside the statement of income, either in other income or directly in equity. |
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(b) |
Deferred Tax |
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Deferred tax assets and liabilities are recognised for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis and operating loss and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognised in income in the period that includes the enactment date. The Company records a valuation allowance for deferred tax assets if, based upon the available evidence, it is more likely than not that some or all of the deferred tax assets will not be realised. |
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Page F - 8
Exhibit 99.1 |
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2. |
SIGNIFICANT ACCOUNTING POLICIES (Continued) |
2.9 |
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Functional and Presentation Currency |
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The financial statements of the Company are measured using the currency of the primary economic environment in which the entity operates ie. Ringgit Malaysia ('RM') ('the functional currency'). However, the Company uses the US dollar as its reporting currency. Therefore, the financial statements of the Company are translated into USD in accordance with ASC 830, Foreign Currency Matters, using the current rate method. Assets and liabilities are translated at the rate of exchange prevailing at the balance sheet dates. Shareholders' equity was translated at the applicable historical rate. Revenue and expenses are translated at the yearly average rates of exchange. Translation gains and losses were included in accumulated other comprehensive income. |
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The principal closing rates used in the translated of foreign currency amounts are as follows :- |
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USD |
USD |
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RM1- As at December 31 |
0.3153 |
0.3248 |
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RM1- Average Rate |
0.3200 |
0.3076 |
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Transactions and Balances |
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Foreign currency transactions are accounted for at exchange rates ruling at the transaction dates. Foreign currency monetary assets and liabilities are translated at exchange rates ruling at the reporting date. Exchange differences arising from the translation of foreign currency monetary assets and liabilities are recognised in the statement of comprehensive income. |
2.10 |
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2.11 |
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Page F - 9
Exhibit 99.1 |
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2. |
SIGNIFICANT ACCOUNTING POLICIES (Continued) |
2.12 |
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2.13 |
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2.14 |
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Certain statuary reporting amounts have been reclassified to conform to the US GAAP presentation. |
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2.15 |
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2.16 |
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Page F - 10
Exhibit 99.1 |
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2. |
SIGNIFICANT ACCOUNTING POLICIES (Continued) |
2.17 |
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(a) |
Recently Implemented StandardsASC 105, Generally Accepted Accounting Principles ("ASC 105") (formerly Statement of Financial Accounting Standards No.168, The FASB Accounting Standards Codification and the Hierarchy of Generally Accepted Accounting Principles a replacement of FASB Statement No.162 ) reorganized by topic existing accounting and reporting guidance issued by the Financial Accounting Standards Board ("FASB") into a single source of authoritative generally accepted accounting principles ("GAAP") to be applied by nongovernmental entities. All guidance contained in the Accounting Standards Codification ("ASC") carries an equal level of authority. Rules and interpretive releases of the Securities and Exchange Commission ("SEC") under authority of federal securities laws are also sources of authoritative GAAP for SEC registrants. Accordingly, all other accounting literature will be deemed "non-authoritative". ASC 105 is effective on a prospective basis for financial statements issued for interim and annual periods ending after September15, 2009. The Company has implemented the guidance included in ASC 105 as of July1, 2009. The implementation of this guidance changed the Company's references to GAAP authoritative guidance but did not impact the Company's financial position or results of operations. ASC 855, Subsequent Events ("ASC 855") (formerly Statement of Financial Accounting Standards No.165, Subsequent Events) includes guidance that was issued by the FASB in May 2009, and is consistent with current auditing standards in defining a subsequent event. Additionally, the guidance provides for disclosure regarding the existence and timing of a company's evaluation of its subsequent events. ASC 855 defines two types of subsequent events, "recognized" and "non-recognized". Recognized subsequent events provide additional evidence about conditions that existed at the date of the balance sheet and are required to be reflected in the financial statements. Non-recognized subsequent events provide evidence about conditions that did not exist at the date of the balance sheet but arose after that date and, therefore; are not required to be reflected in the financial statements. However, certain non-recognized subsequent events may require disclosure to prevent the financial statements from being misleading. This guidance was effective prospectively for interim or annual financial periods ending after June15, 2009. The Company implemented the guidance included in ASC 855 as of April1, 2009. The effect of implementing this guidance was not material to the Company's financial position or results of operations. |
Page F - 11
Exhibit 99.1 |
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2. |
SIGNIFICANT ACCOUNTING POLICIES (Continued) |
2.17 |
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(a) |
Recently Implemented Standards (Continued) ASC 944, Financial Services - Insurance ("ASC 944") contains guidance that was previously issued by the FASB in May 2008 as Statement of Financial Accounting Standards No.163, Accounting for Financial Guarantee Insurance Contracts - an interpretation of FASB Statement No.60 that provides for changes to both the recognition and measurement of premium revenues and claim liabilities for financial guarantee insurance contracts that do not qualify as a derivative instrument in accordance with ASC 815, Derivatives and Hedging (formerly included under Statement of Financial Accounting Standards No.133, Accounting for Derivative Instruments and Hedging Activities). This financial guarantee insurance contract guidance also expands the disclosure requirements related to these contracts to include such items as a company's method of tracking insured financial obligations with credit deterioration, financial information about the insured financial obligations, and management's policies for placing and monitoring the insured financial obligations. ASC 944, as it relates to financial guarantee insurance contracts, was effective for fiscal years beginning after December15, 2008, except for certain disclosures related to the insured financial obligations, which were effective for the third quarter of 2008. The Company does not have financial guarantee insurance products, and, accordingly, the implementation of this portion of ASC 944 did not have an effect on the Company's results of operations or financial position. ASC 805, Business Combinations ("ASC 805") (formerly included under Statement of Financial Accounting Standards No.141 (revised 2007), Business Combinations) contains guidance that was issued by the FASB in December 2007. It requires the acquiring entity in a business combination to recognize all assets acquired and liabilities assumed in a transaction at the acquisition-date fair value, with certain exceptions. Additionally, the guidance requires changes to the accounting treatment of acquisition related items, including, among other items, transaction costs, contingent consideration, restructuring costs, indemnification assets and tax benefits. ASC 805 also provides for a substantial number of new disclosure requirements. ASC 805 also contains guidance that was formerly issued as FSP FAS 141(R)-1, Accounting for Assets Acquired and Liabilities Assumed in a Business Combination That Arise from Contingencies which was intended to provide additional guidance clarifying application issues regarding initial recognition and measurement, subsequent measurement and accounting, and disclosure of assets and liabilities arising from contingencies in a business combination. ASC 805 was effective for business combinations initiated on or after the first annual reporting period beginning after December15, 2008. The Company implemented this guidance effective January1, 2009. Implementing this guidance did not have an effect on the Company's financial position or results of operations; however it will likely have an impact on the Company's accounting for future business combinations, but the effect is dependent upon acquisitions, if any, that are made in the future. |
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Page F - 12
Exhibit 99.1 |
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2. |
SIGNIFICANT ACCOUNTING POLICIES (Continued) |
2.17 |
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(a) |
Recently Implemented Standards (Continued) ASC 810, Consolidation ("ASC 810") includes new guidance issued by the FASB in December 2007 governing the accounting for and reporting of noncontrolling interests (previously referred to as minority interests). This guidance established reporting requirements which include, among other things, that noncontrolling interests be reflected as a separate component of equity, not as a liability. It also requires that the interests of the parent and the noncontrolling interest be clearly identifiable. Additionally, increases and decreases in a parent's ownership interest that leave control intact shall be reflected as equity transactions, rather than step acquisitions or dilution gains or losses. This guidance also requires changes to the presentation of information in the financial statements and provides for additional disclosure requirements. ASC 810 was effective for fiscal years beginning on or after December15, 2008. The Company implemented this guidance as of January1, 2009. The effect of implementing this guidance was not material to the Company's financial position or results of operations. ASC 825, Financial Instruments ("ASC 825") includes guidance which was issued in February 2007 by the FASB and was previously included under Statement of Financial Accounting Standards No.159, The Fair Value Option for Financial Assets and Financial Liabilities Including an amendment of FASB Statement No.115. The related sections within ASC 825 permit a company to choose, at specified election dates, to measure at fair value certain eligible financial assets and liabilities that are not currently required to be measured at fair value. The specified election dates include, but are not limited to, the date when an entity first recognizes the item, when an entity enters into a firm commitment or when changes in the financial instrument causes it to no longer qualify for fair value accounting under a different accounting standard. An entity may elect the fair value option for eligible items that exist at the effective date. At that date, the difference between the carrying amounts and the fair values of eligible items for which the fair value option is elected should be recognized as a cumulative effect adjustment to the opening balance of retained earnings. The fair value option may be elected for each entire financial instrument, but need not be applied to all similar instruments. Once the fair value option has been elected, it is irrevocable. Unrealized gains and losses on items for which the fair value option has been elected will be reported in earnings. This guidance was effective as of the beginning of fiscal years that began after November15, 2007. The Company does not have eligible financial assets and liabilities, and, accordingly, the implementation of ASC 825 did not have an effect on the Company's results of operations or financial position. |
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Exhibit 99.1 |
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2. |
SIGNIFICANT ACCOUNTING POLICIES (Continued) |
2.17 |
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(a) |
Recently Implemented Standards (Continued)ASC 820, Fair Value Measurements and Disclosures ("ASC 820") (formerly included under Statement of Financial Accounting Standards No.157, Fair Value Measurements) includes guidance that was issued by the FASB in September 2006 that created a common definition of fair value to be used throughout generally accepted accounting principles. ASC 820 applies whenever other standards require or permit assets or liabilities to be measured at fair value, with certain exceptions. This guidance established a hierarchy for determining fair value which emphasizes the use of observable market data whenever available. It also required expanded disclosures which include the extent to which assets and liabilities are measured at fair value, the methods and assumptions used to measure fair value and the effect of fair value measures on earnings. ASC 820 also provides additional guidance for estimating fair value when the volume and level of activity for the asset or liability have significantly decreased. The emphasis of ASC 820 is that fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between willing market participants, under current market conditions. ASC 820 also further clarifies the guidance to be considered when determining whether or not a transaction is orderly and clarifies the valuation of securities in markets that are not active. This guidance includes information related to a company's use of judgment, in addition to market information, in certain circumstances to value assets which have inactive markets. Fair value guidance in ASC 820 was initially effective for fiscal years beginning after November15, 2007 and for interim periods within those fiscal years for financial assets and liabilities. The effective date of ASC 820 for all non-recurring fair value measurements of nonfinancial assets and nonfinancial liabilities was fiscal years beginning after November15, 2008. Guidance related to fair value measurements in an inactive market was effective in October 2008 and guidance related to orderly transactions under current market conditions was effective for interim and annual reporting periods ending after June15, 2009. |
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(b) |
Recently Issued Standards In June 2011, the Financial Accounting Standard Board ("FASB") issued Accounting Standard Update ("ASU") 2011-05, Presentation of Comprehensive Income, which requires an entity to present the total of comprehensive income, the components of net income, and the components of other comprehensive income either in a single continuous statement of comprehensive income, or in two separate but consecutive statements. ASU 2011-05 eliminates the option to present components of other comprehensive income as part of the statement of equity. ASU 2011-05 will be effective for the Company beginning after December 15, 2011. The Company does not expect the adoption of ASU 2011-05 to have a material effect on its operating results or financial position. However, it will impact the presentation of comprehensive income. |
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Page F -14
Exhibit 99.1 |
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2. |
SIGNIFICANT ACCOUNTING POLICIES (Continued) |
2.17 |
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(b) |
Recently Issued Standards (Continued) In May 2011, the FASB issued ASU 2011-04, Fair Value Measurement (Topic 820): Amendments to Achieve Common Fair Value Measurement and Disclosure Requirements in U.S. GAAP and International Financial Reporting Standards ("IFRS"). ASU 2011-04 clarifies some existing concepts, eliminates wording differences between U.S. GAAP and IFRS, and in some limited cases, changes some principles to achieve convergence between U.S. GAAP and IFRS. ASU 2011-04 results in a consistent definition of fair value and common requirements for measurement of and disclosure about fair value between U.S. GAAP and IFRS. ASU 2011-04 also expands the disclosures for fair value measurements that are estimated using significant unobservable (Level 3) inputs. ASU 2011-04 will be effective for the Company beginning after December 15, 2011. The Company does not expect the adoption of ASU 2011-04 to have a material effect on its operating results or financial position. In April 2011, the FASB issued ASU 2011-03, Consideration of Effective Control on Repurchase Agreements, which deals with the accounting for repurchase agreements and other agreements that both entitle and obligate a transferor to repurchase or redeem financial assets before their maturity. ASU 2011-03 changes the rules for determining when these transactions should be accounted for as financings, as opposed to sales. The guidance in ASU 2011-03 is effective for the first interim or annual period beginning on or after December 15, 2011. The guidance should be applied prospectively to transactions or modifications of existing transactions that occur on or after the effective date. Early adoption is not permitted. The adoption of ASU 2011-03 is not expected to have a material impact on the Company's financial condition or results of operation. In April 2011, the FASB issued ASU 2011-02, "A Creditor's Determination of Whether a Restructuring is a Troubled Debt Restructuring", which clarifies when creditors should classify loan modifications as troubled debt restructurings. The guidance is effective for interim and annual periods beginning on or after June 15, 2011, and applies retrospectively to restructurings occurring on or after the beginning of the year. The guidance on measuring the impairment of a receivable restructured in a troubled debt restructuring is effective on a prospective basis. A provision in ASU 2011-02 also ends the FASB's deferral of the additional disclosures about troubled debt restructurings as required by ASU 2010-20. The adoption of ASU 2011-02 is not expected to have a material impact on the Company's financial condition or results of operations. |
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Exhibit 99.1 |
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3. |
CASH AND CASH EQUIVALENTS |
(a) The fixed deposits with licensed banks bear interest rate at 3% (2010 : 3%) per annum. |
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(b) Cash and cash equivalents comprise of the following as at the end of the reporting period: |
2011 |
2010 |
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USD |
USD |
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| Cash and bank balances | 13,807 |
7,285 |
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| Fixed deposits with licensed banks | 67,580 |
49,381 |
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| 81,387 | 56,666 | ||||
| Less: Restricted cash | (57,395) |
(49,381) |
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| Bank overdrafts (Note) | - |
(177,549) |
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23,992 |
(170,264) |
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Note: The bank overdrafts for financial year ended 31st December 2010 bear interest ranging from 1.85 to 3.50 percentage point above the Central Bank's funding rate for the first three years and thereafter at 2.00 percentage point above lender's base lending rates. The bank overdrafts w ere secured by the following during the previous year:- |
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(i) |
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Guarantee from Credit Guarantee Corporation under Flexi Guarantee Scheme coverage of 70% on clean exposure; |
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(iii) |
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(iv) |
Jointly and severally guaranteed by certain Directors of the Company. |
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Page F-16
Exhibit 99.1 |
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4. |
TRADE RECEIVABLES |
Note |
2011 |
2010 |
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| Trade receivables | |||||
| Third parties | 1,819,683 |
1,194,059 |
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| Amount owing by a corporation in which a Director has financial interest | 19 |
1,197,686 |
1,878,156 |
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3,017,369 |
3,072,215 |
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| Less: Allowance for impairment losses | - |
(4,872) |
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| Trade receivables, net | 3,017,369 |
3,067,343 |
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Allowance of impairment losses: |
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| At 1 January | 4,872 |
4,382 |
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| Written-off | (4,872) | - | |||
| Foreign currency translation reserve | - |
490 |
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| At 31 December | - |
4,872 |
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| Bad debts written-off during the year recognised in statement of income | - |
1,359 |
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Trade receivables are non-interest bearing and the normal credit terms range from 30 to 90 days (2010: 30 to 90 days) terms. Other credit terms are assessed and approved on a case-by-case basis. The Company has no significant concentration of credit risk that arises from exposure to a single debtor or to groups of debtors. |
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5. |
OTHER RECEIVABLES |
2011 |
2010 |
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| Other receivables | 372 |
18,883 |
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| Deposits | 25,302 |
26,065 |
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| Prepayments | 113,381 | 29 |
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139,055 |
44,977 |
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Exhibit 99.1 |
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6. |
PROPERTY, PLANT AND EQUIPMENT |
Motor |
Furniture and |
Office |
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vehicles |
fittings |
equipment |
Mould |
Renovation |
Total |
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| 2011 | USD |
USD |
USD |
USD |
USD |
USD |
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| COST | ||||||||||||
| At the beginning of the year | 244,455 |
64,181 |
88,597 |
4,352 |
81,688 |
483,273 |
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| Acquisition during the year | 26,301 |
- |
1,626 |
- |
- |
27,927 |
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| Disposal during the year | (81,825) |
- |
- |
- |
- |
( 81,825 ) |
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| Foreign currency translation reserve | (7,153) |
(1,878) |
(2,592) |
(127) |
(2,390) |
(14,140) |
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| At the end of the year | 181,778 |
62,303 |
87,631 |
4,225 |
79,298 |
415,235 |
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| ACCUMULATED DEPRECIATION | ||||||||||||
| At the beginning of the year | 156,612 |
47,569 |
63,374 |
4,316 |
54,768 |
326,639 |
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| Charge for the year | 25,785 |
12,129 |
10,792 |
34 |
16,095 |
64,835 |
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| Disposal during the year | (50,376) |
- |
- |
- |
- |
( 50,376 ) |
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| Foreign currency translation reserve | (4,222) |
(1,570) |
(2,012 ) |
(126) |
(1,838) |
( 9,768 ) |
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| At the end of the year | 127,799 |
58,128 |
72,154 |
4,224 |
69,025 |
331,330 |
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| NET BOOK VALUE | ||||||||||||
| At the end of the year | 53,979 |
4,175 |
15,477 |
1 |
10,273 |
83,905 |
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Page F - 18
Exhibit 99.1 |
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6. |
PROPERTY, PLANT AND EQUIPMENT (Continued) |
Motor |
Furniture and |
Office |
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vehicles |
fittings |
equipment |
Mould |
Renovation |
Total |
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| 2010 | USD |
USD |
USD |
USD |
USD |
USD |
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| COST | ||||||||||||
| At the beginning of the year | 187,923 |
56,375 |
73,604 |
3,914 |
64,705 |
386,521 |
||||||
| Acquisition during the year | 35,505 |
1,498 |
6,756 |
- |
9,744 |
53,503 |
||||||
| Foreign currency translation reserve | 21,027 |
6,308 |
8,237 |
438 |
7,239 |
43,249 |
||||||
| At the end of the year | 244,455 |
64,181 |
88,597 |
4,352 |
81,688 |
483,273 |
||||||
| ACCUMULATED DEPRECIATION | ||||||||||||
| At the beginning of the year | 120,799 |
33,095 |
44,190 |
3,850 |
34,636 |
236,570 |
||||||
| Charge for the year | 21,115 |
10,200 |
13,485 |
33 |
15,396 |
60,229 |
||||||
| Foreign currency translation reserve | 14,698 |
4,274 |
5,699 |
433 |
4,736 |
29,840 |
||||||
| At the end of the year | 156,612 |
47,569 |
63,374 |
4,316 |
54,768 |
326,639 |
||||||
| NET BOOK VALUE | ||||||||||||
| At the end of the year | 87,843 |
16,612 |
25,223 |
36 |
26,920 |
156,634 |
||||||
Page F - 19
Exhibit 99.1 |
|
|
6. |
PROPERTY, PLANT AND EQUIPMENT (Continued) |
(a) |
|
(b) |
|
2011 |
2010 |
|||||
Note |
USD |
USD |
||||
| Total cost of property, plant and equipment | 27,927 |
53,503 |
||||
| Less: Purchase consideration satisfied by obligation under finance leases | 11 |
(23,174) |
(31,180) |
|||
4,753 |
22,323 |
|||||
7. |
TRADE PAYABLES |
2011 |
2010 |
||||
Note |
USD |
USD |
|||
Trade payables |
44,197 |
82,983 |
|||
| Amount owing to a corporation in which a Director has financial interest | 19 |
- |
73,924 |
||
44,197 |
156,907 |
||||
|
8. |
OTHER PAYABLES AND ACCRUALS |
2011 |
2010 |
||||
USD |
USD |
||||
Other payables |
128,369 |
106,156 |
|||
Accruals |
170,165 |
186,774 |
|||
298,534 |
292,930 |
||||
|
9. |
AMOUNT OWING TO DIRECTORS |
Note |
2011 |
2010 |
|||
USD |
USD |
||||
Amount owing to directors |
19 |
133,027 |
65,388 |
Page F - 20
Exhibit 99.1 |
|
|
10. |
TRADE FINANCING PAYABLES |
|
Trade financing payables for the financial year ended 31st December 2010 which bear interest at 2.0 percentage points above the lender's base lending rates provide by RCE Factoring Sdn. Bhd. and HSBC Bank Malaysia Berhad were secured as follows:- |
||
(i) |
Pledged of fixed deposits of the Company; |
|
| (ii) | Guaranteed by Credit Guarantee Corporation; | |
| (iii) | Jointly and severally guaranteed by the Directors of the Company; and | |
| (iv) | Corporate guarantee given by a third party corporation in which the Directors have financial interest. | |
Trade financing payables for the financial year ended 31st December 2011 which bear interest at 2.0 percentage points above the lender's base lending rates are secured as follows:- |
||
(i) |
Acceptance of the Facility Offer Letter; |
|
| (ii) | Execution of the Receivables Finance Agreement; and | |
| (iii) | Jointly and severally guaranteed by a Director of the Company and a third party. | |
|
||
11. |
OBLIGATION UNDER FINANCE LEASES |
2011 |
2010 |
||||
USD |
USD |
||||
| Minimum lease payments: | |||||
| Not later than one (1) year | 30,332 |
40,136 |
|||
| Later than one (1) year but not later than five (5) years | 68,512 |
105,213 |
|||
| Total minimum lease payments | 98,844 |
145,349 |
|||
| Less: Future interest charges | (19,490) |
(28,836) |
|||
| Present value of minimum lease payments | 79,354 |
116,513 |
|||
| Repayable as follows: | |||||
| Not later than one (1) year | 24,433 |
32,709 |
|||
| Later than one (1) year and not later than five (5) years | 54,921 |
83,804 |
|||
79,354 |
116,513 |
||||
The effective rates implicit in the lease is range between 4.76% to 7.30% (2010 : 4.76% to 7.30%) per annum. |
Exhibit 99.1 |
|
|
12. |
TERM LOANS |
2011 |
2010 |
||||
USD |
USD |
||||
| Current portion: | |||||
| Not later than one (1) year | 181,030 |
112,665 |
|||
| Non-current portion: | |||||
| later than one (1) year and not later than two (2) years | 194,788 |
- |
|||
| later than two (2) years and not later than five (5) years | 79,801 |
- |
|||
274,589 |
- |
||||
455,619 |
112,665 |
||||
|
The term loans are provide by Standard Chartered Bank Malaysia Berhad and Alliance Bank Malaysia Berhad are secured by the following:- |
Term loan I |
||
(i) |
Pledged of Company's fixed deposit; |
|
| (ii) | Debentures over the fixed and floating assets of the Company; | |
| (iii) | Guarantee by Credit Guarantee Corporation (M) Berhad; | |
| (iv) | Notice of assignment and receivables finance agreement; and | |
| (v) | Joint and several guarantee by the Directors of the Company. | |
The interest rates and discount charge applicable to the facilities range between 1.00 to 3.75 percentage points above the lenders' base lending rates. |
||
Term loan I is repayable by 60 equal monthly installment of USD1,941 (RM 5,976) per month. |
||
Term loan II |
||
(i) |
Pledged of Company's fixed deposit; |
|
| (ii) | Guarantee by a third party corporation in which the Directors have financial interest; | |
| (iii) | Notice of assignment and receivables finance agreement; and | |
| (iv) | Joint and several guarantee by the Directors of the Company. | |
The interest rates to the facilities is fixed at 1.00 percentage points above the lenders' base lending rates. |
||
|
||
Page F - 22
Exhibit 99.1 |
|
|
13. |
SHARE CAPITAL |
Number of ordinary |
||||||||
shares of RM1 each |
Amount |
|||||||
2011 |
2010 |
2011 |
2010 |
|||||
USD |
USD |
|||||||
| Authorised | ||||||||
| At 1 January and 31 December | 5,000,000 |
5,000,000 | 1,457,768 |
1,457,768 |
||||
| Issued and fully paid up | ||||||||
| At 1 January and 31 December | 2,000,000 |
2,000,000 |
583,107 |
583,107 |
||||
The fully paid-up share capital of the Company and the related changes since its incorporation are as follows:- |
Balance As Of |
|
Par
value |
Consideration | USD |
RM |
|||||
January 10, 2004 |
2 |
1.00 |
Cash |
1 |
2 |
|||||
March 5, 2004 |
100,000 |
1.00 |
Cash |
29,155 |
100,000 |
|||||
February 19, 2005 |
400,000 |
1.00 |
Cash |
116,621 |
400,000 |
|||||
September 12, 2006 |
1,000,000 |
1.00 |
Bonus issue |
291,554 |
1,000,000 |
|||||
December 7, 2009 |
2,000,000 |
1.00 |
Cash |
583,107 |
2,000,000 |
|||||
14. |
REVENUE |
2011 |
2010 |
||||
USD |
USD |
||||
Sale of goods - Third parties |
6,932,545 |
4,994,706 |
|||
15. |
FINANCE COSTS |
2011 |
2010 |
||||
| Interest expense on: | USD |
USD |
|||
| Trade financing | 21,754 |
58,992 |
|||
| Bank overdraft | 4,598 |
35,395 |
|||
| Obligation under finance lease | 8,635 |
6,630 |
|||
| Term loans | 38,932 |
975 |
|||
73,919 |
101,992 |
||||
Exhibit 99.1 |
|
|
16. |
INCOME TAX EXPENSE |
2011 |
2010 |
||||
USD |
USD |
||||
Income tax expenses: |
|||||
Estimated current tax |
127,988 |
21,531 |
|||
Overprovision in prior years |
(41) |
- |
|||
127,947 |
21,531 |
||||
| A reconciliation of income tax expense applicable to the profit before tax at the applicable statutory income tax rate to income tax expense at the effective tax rate of the Company is as follows: |
2011 |
2010 |
|||
USD |
USD |
|||
| Profit before taxation | 483,625 |
92,921 |
||
| Tax at the applicable tax rate of : | ||||
| - 20% on the first RM500,000 chargeable income | 31,997 |
18,584 |
||
| - 25% on the balance of the chargeable income | 80,910 | - | ||
| Tax effects of: | ||||
| Expenses which are not deductible | 16,497 |
7,446 |
||
| Deferred tax liability not provided for | (1,416) |
(4,499) |
||
| Overprovision in prior years in respect of income tax | (41) |
- |
||
127,947 |
21,531 |
|||
The Company has not recognised deferred tax liabilities due to its immateriality and the details are as follows :- |
||||
2011 |
2010 |
|||
USD |
USD |
|||
| Deferred tax liabilities :- | ||||
| Property, plant and equipment | 1,147 | 17,665 | ||
|
Subject to the confirmation of the Inland Revenue Board, as at 31st December 2010, the Company has tax exempt income derived from Income Tax (Exemption) (No.12) Order 2002 of approximately USD 624,096 (2010 : USD 642,907) which enable the Company to distribute tax exempt dividends of the equivalent amount. |
17. |
DIRECTORS' REMUNERATION |
2011 |
2010 |
||||
USD |
USD |
||||
| Directors of the Company :- | |||||
| - fees | 19,198 | 18,916 | |||
| - salaries | 30,717 | 29,528 | |||
| - other emoluments | 3,686 |
9,218 |
|||
Page F - 24
Exhibit 99.1 |
|
|
18. |
CONTINGENT LIABILITIES |
| Note | 2011 |
2010 |
|||
USD |
USD |
||||
Corporate guarantee given to a financial institution for facilities granted to a corporation as disclosed in Note 19 in which a Director has financial interest |
19 | 415,943 |
123,578 |
||
The Directors are of the view that the chances of the financial institutions to call upon the corporate guarantees are remote. |
|
19. |
RELATED PARTY TRANSACTIONS |
|
Note |
2011 |
2010 |
|||
USD |
USD |
||||
| Transactions | |||||
| Purchase of goods | 5,315,415 |
3,146,480 |
|||
| Storage charges | 44,782 |
274,709 |
|||
| Administrative expenses | 159,985 |
- |
|||
| Account balances as at 31 December | |||||
| Trade receivables | 4 |
1,197,686 |
1,878,156 |
||
| Trade payables | 7 |
- |
(73,924) |
||
| Non-account balances as at 31 December | |||||
| Contingent liability | 18 |
415,943 |
123,578 |
||
|
The above disclosure relates to a Malaysia incorporated corporation, Total E&E Industries Sdn. Bhd. in which Mr. Ng Boon Bhoay owns 97.5% (2010: 97.5%) of the equity interest of that corporation. |
| Directors | 2011 |
2010 |
|||
Note |
USD |
USD |
|||
| Account balances as at 31 December | |||||
| Amount owing to directors | 9 |
133,027 | 65,388 | ||
Page F - 25
Exhibit 99.1 |
|
|
20. |
COMMITMENTS |
The Company leases office premises for its operations in Malaysia under operating leases. Rental expenses incurred under operating lease are as follows :- |
2011 |
2010 |
||||
USD |
USD |
||||
| Rental of premises | 57,594 |
47,522 |
|||
Future minimum rental payments under non-cancelable operating leases as at 31st December 2011 are approximately USD 52,023. |
|||||
21. |
SEGMENT REPORTING |
The Company is currently operating in a single business segment as trader of electrical appliances. As such, there was no segment reporting prepared. In addition, the Company is operating in Malaysia only and there will have no geographic segment presentation. |
|
22. |
SUBSEQUENT EVENTS |
The Company has evaluated all subsequent events through 31st May 2012, the date this financial statement was issued, and determined that, there were no subsequent events or transactions that require recognition or disclosures in the financial statements. |
Page F - 26