Notice of Annual General Meeting - Announcements - Bursa Malaysia

ANNUAL REPORT 2012 GROMUTUAL BERHAD (Company No. 625034-X) 

CONTENTS 

1 

4 

6 

7 

8 

9 

11 

13 

15 

19 

21 

22 

23 

66 

68 

73 

Notice of Annual General Meeting 

Annexure A - Proposed Amendments to The 

Articles of Association of Gromutual Berhad 

Statement Accompanying Notice of AGM 

Group Structure 

Financial Highlights 

Corporate Information 

Profile of The Board of Directors 

Chairman's Statement 

Statement on Corporate Governance 

Audit Committee Report 

Statement on Risk Management And 

Internal Control 

Management's Operations Review 

Financial Statements 

Analysis of Shareholdings 

List of Properties 

Form of Proxy

NOTICE OF ANNUAL GENERAL MEETING 

1. 

2. 

3. 

4. 

5. 

6. 

NOTICE IS HEREBY GIVEN THAT the 10th Annual General Meeting of Gromutual Berhad will be held at 

Dewan Johor, 2nd Floor, Mutiara Johor Bahru, Jalan Dato Sulaiman, Taman Century, 80250 Johor 

Bahru, Johor Darul Takzim, Malaysia on Monday, 27 May 2013 at 10.00 a.m. to transact the 

following purposes : 

AGENDA 

ORDINARY BUSINESS : 

To receive the Audited Financial Statements for the 

financial year ended 31 December 2012 and the Reports of 

the Directors and Auditors thereon. 

To declare and approve the payment of a Single Tier Final 

Dividend of 1% in respect of the financial year ended 31 

December 2012. 

To approve the payment of Directors' Fee of RM184,000 for 

the financial year ended 31 December 2012. 

To re-elect the following Directors who retire by rotation 

pursuant to Article 84 of the Company's Articles of 

Association : 

4.1 Ms. Chew Kwee Hiok 

4.2 Mr. Yeoh Beng Sang 

4.3 Encik Azahar Bin Baharudin 

To re-appoint Messrs. Deloitte KassimChan as Auditors of the 

Company and to authorise the Directors to fix their 

remuneration. 

SPECIAL BUSINESS : 

To consider and if thought fit, to pass the following 

resolution with or without modifications : 

ORDINARY RESOLUTIONS 

AUTHORITY TO DIRECTORS TO ISSUE AND ALLOT SHARES 

PURSUANT TO SECTION 132D OF THE COMPANIES ACT, 1965 

“THAT subject always to the Companies Act, 1965, Articles of 

Association of the Company and approvals from Bursa 

Malaysia Securities Berhad and any other governmental/ 

regulatory bodies, where such approval is necessary, authority 

be and is hereby given to the Directors pursuant to Section 132D 

of the Companies Act, 1965 to issue and allot not more than ten 

percent (10%) of the issued capital of the Company at any time 

upon any such terms and conditions and for such purposes as 

the Directors may in their absolute discretion deem fit or in 

pursuance of offers, agreements or options to be made or 

granted by the Directors while this approval is in force until the 

conclusion of the next Annual General Meeting of the 

Company and that the Directors be and are hereby further 

authorised to make or grant offers, agreements or options which 

would or might require shares to be issued after the expiration of 

the approval hereof AND THAT authority be and is hereby given 

to the Directors to obtain approval for the listing of and 

quotation for the additional shares so issued on Bursa Malaysia 

Securities Berhad.” 

Resolution on Proxy Form 

(Please refer Explanatory Note 1) 

(Resolution 1) 







01 

ANNUAL REPORT 2012 GROMUTUAL BERHAD (Company No. 625034-X)

02 


NOTICE OF ANNUAL GENERAL MEETING (continue) 

7. 

CONTINUING IN OFFICE AS INDEPENDENT NON-EXECUTIVE 

DIRECTORS 

7.1 YH DATO’ CHONG KEAP THAI @ CHEONG KEAP TAI 

7.2 MR. YEOH BENG SANG 

SPECIAL RESOLUTION 

8. 

9. 

“THAT authority be and is hereby given to YH Dato’ Chong 

Keap Thai @ Cheong Keap Tai who will be serving as an 

Independent Non-Executive Director of the Company for 

a cumulative term of nine (9) years by 22 November 2013 

to continue to act as an Independent Non-Executive 

Director of the Company.” 

“THAT subject to the passing of the Ordinary Resolution 4, 

authority be and is hereby given to Mr. Yeoh Beng Sang 

who will be serving as an Independent Non-Executive 

Director of the Company for a cumulative term of nine (9) 

years by 22 November 2013 to continue to act as an 

Independent Non-Executive Director of the Company.” 

PROPOSED AMENDMENTS TO THE ARTICLES OF ASSOCIATION 

OF THE COMPANY 

“THAT the proposed amendments to the Articles of Association 

of the Company as set out in “Annexure A” attached to the 

Annual Report be and are hereby approved and adopted. 

AND THAT the Directors and Secretary of the Company be and 

are hereby authorised to take all steps as are necessary and 

expedient in order to implement, finalise and give full effect to 

the Proposed Amendments to the Company’s Articles of 

Association.” 

To transact any other business of which due notice shall have 

been given. 

NOTICE OF DIVIDEND ENTITLEMENT AND PAYMENT 




NOTICE IS ALSO HEREBY GIVEN THAT a Single Tier Final Dividend of 1%, in respect of the financial year 

ended 31 December 2012, if approved by the shareholders at the 10th Annual General Meeting, will be 

payable on 27 June 2013 to depositors registered in the Record of Depositors at the close of business 

on 12 June 2013. 

A depositor shall qualify for entitlement to the dividend only in respect of : 

(a) Shares transferred into the Depositor’s Securities Account before 4.00 p.m. on 12 June 2013 in 

respect of ordinary transfers; and 

(b) Shares bought on the Bursa Malaysia Securities Berhad on a cum entitlement basis according to the 

Rules of the Bursa Malaysia Securities Berhad. 

BY ORDER OF THE BOARD 

YONG MAY LI (f) 

LS 0000295 

Company Secretary 

Johor Bahru 

30 April 2013

NOTICE OF ANNUAL GENERAL MEETING (continue) 

NOTES:- 

1. 

2. 

3. 

4. 

5. 

6. 

7. 

A member of the Company entitled to attend and vote at the meeting may appoint a proxy or proxies (but not more than 

two (2)) to attend and vote in his/her stead. A proxy may but need not be a member of the Company. 

A member of the Company who is an authorised nominee as defined under the Securities Industry (Central Depositories) Act, 

1991 is allowed to appoint at least one (1) proxy in respect of each securities account it holds with ordinary shares of the 

Company standing to the credit of the said securities account. 

Where a member of the Company is an exempt authorised nominee as defined under the Securities Industry (Central 

Depositories) Act, 1991, which holds ordinary shares in the Company for multiple beneficial owners in one (1) securities 

account (“omnibus account”), there is no limit to the number of proxies which the exempt authorised nominee may appoint 

in respect of each omnibus account it holds. 

Where a member appoints two (2) proxies or where an exempt authorised nominee appoints two (2) or more proxies, the 

appointments shall be invalid unless he/she specifies the proportion of his/her holdings to be represented by each proxy. 

The instrument appointing a proxy, in the case of an individual shall be signed by the appointor or his/her attorney duly 

authorised in writing and in the case of a corporation, either under seal or under the hand of an officer or attorney duly 

authorised. If no name is inserted in the space for the name of your proxy, the Chairman of the Meeting will act as your 

proxy. 

The instrument appointing a proxy must be deposited at the Registered Office of the Company situated at Suite 1301, 13th 

Floor, City Plaza, Jalan Tebrau, 80300 Johor Bahru, Johor Darul Takzim, Malaysia not less than 48 hours before the time 

appointed for holding the meeting or any adjournment thereof. 

Only members whose names appear on the Record of Depositors as at 20 May 2013 will be entitled to attend this meeting. 

EXPLANATORY NOTES 

1. 

2. 

3. 

4. 

Item 1 of the Agenda 

This Agenda item is meant for discussion only as the provision of Section 169(1) of the Companies Act, 1965 does not require a 

formal approval of the shareholders for the Audited Financial Statements. Hence, this Agenda item is not put forward for 

voting. 


ORDINARY RESOLUTION 

Resolution 7 - AUTHORITY TO DIRECTORS TO ISSUE AND ALLOT SHARES PURSUANT TO SECTION 132D OF THE COMPANIES ACT, 1965 

Resolution 7 proposed under item 6 of the Agenda is for the purpose of granting a renewal of the general mandate and if 

passed, will provide flexibility to the Company to issue new securities without the need to convene separate general meeting 

to obtain its shareholders’ approval so as to avoid incurring additional cost and time. The purpose of this general mandate is 

for possible fund raising exercise including but not limited to further placement of shares for purpose of funding current 

and/or future investment projects, working capital, repayment of bank borrowings, acquisitions and/or for issuance of shares 

as settlement of purchase consideration. This authority will commence from the date of this Annual General Meeting and 

unless earlier revoked or varied by the shareholders of the Company at a subsequent general meeting, expire at the next 

Annual General Meeting of the Company. 

As at the date of this Notice, no new shares have been issued pursuant to the mandate obtained at the 9th Annual General 

Meeting of the Company held on 28 May 2012, and accordingly no proceeds were raised. 


ORDINARY RESOLUTIONS 

RESOLUTION 8 AND 9 - CONTINUING IN OFFICE AS INDEPENDENT NON-EXECUTIVE DIRECTORS 

YH Dato’ Chong Keap Thai @ Cheong Keap Tai and Mr. Yeoh Beng Sang both will be serving on the Board as Independent 

Non-Executive Directors of the Company for a cumulative term of nine (9) years by 22 November 2013. The Board holds the 

view that both of them remain objective and independent in carrying out their roles and responsibilities as members of the 

Board and Board Committees. The length of their service does not interfere with their ability and exercise of independent 

judgment as Independent Directors. Therefore, the Board has recommended that the approval of the shareholders be 

sought for them to continue to act as the Independent Non-Executive Directors of the Company. 


SPECIAL RESOLUTION 

RESOLUTION 10 - PROPOSED AMENDMENTS TO THE ARTICLES OF ASSOCIATION OF THE COMPANY 

The proposed Special Resolution, if passed will enable the Company to comply with the recent amendments to the Main 

Market Listing Requirements of Bursa Malaysia Securities Berhad as well as for better clarity and enhancement. 

01 03 


04 


ANNEXURE A-PROPOSED AMENDMENTS TO THE ARTICLES 

OF ASSOCIATION OF GROMUTUAL BERHAD 

In conjunction with the amendments to the Main Market Listing Requirements of Bursa Malaysia Securities Berhad, the Company 

proposes to implement the following amendments to the Articles of Association of the Company to comply with the amended 

provisions of the Main Market Listing Requirements of Bursa Malaysia Securities Berhad : 

ARTICLE NO. EXISTING ARTICLES AMENDED ARTICLES 

To amend Article 2 

“Definitions” 

To amend Article 4(c) 


To insert new 

Article 63A 

“Approved Market Place” – A stock 

exchange which is specified to be an 

approved market place in the Securities 

Industry (Central Depositories) (Exemption) 

(No.2) Order 1998. 

“Listing Requirements” – The Listing 

Requirements of the Exchange including 

any amendments to the Listing 

Requirements that may be made from time 

to time. 

None 

None 

None 

Allotment of Shares 

every issue of shares or options to 

employees and/or Directors of the 

Company shall be approved by the 

Members in general meeting and no 

Director shall participate in such issues of 

shares unless:- 

i) the Members in general meeting have 

approved of the specific issue and 

allotment to such Director; and 

ii) he holds office in the Company in an 

executive or non executive capacity 

Notice that proxy is allowed 

In every notice calling a meeting of 

the Company there shall appear with 

reasonable prominence, a statement 

that a Member entitled to attend and 

vote is entitled to appoint not more 

than two (2) proxies to attend and vote 

in his stead, and that a proxy may but 

need not be a Member and/or a 

qualified legal practitioner, an 

approved company auditor or a 

person approved by the Registrar. 

Where a Member appoints two (2) 

proxies, he shall specify the proportion 

of his holdings to be represented by 

each proxy, failing which the 

appointment shall be invalid. 

None 

Deleted. 

“Listing Requirements” – The Main Market Listing 

Requirements of the Exchange including any 

amendments to the Listing Requirements that may be 

made from time to time. 

“Securities” – shall have the meaning given in Section 

2 of the Capital Markets and Service Act 2007. 

“Shares” – shares in the Company. 

“Share Issuance Scheme” means a scheme involving 

a new issuance of shares to the employees. 

Allotment of Shares 

every issue of shares or a Share Issuance Scheme or 

options to employees and/or Directors of the 

Company shall be approved by the Members in 

general meeting and no Director shall participate in 

such issues of shares unless:- 

i) the Members in general meeting have approved 

of the specific issue and allotment to such Director; 

and 

ii) he holds office in the Company in an executive 

or non executive capacity 

Notice that proxy is allowed 

In every notice calling a meeting of the Company 

there shall appear with reasonable prominence, a 

statement that a Member entitled to attend and vote 

at a meeting of the Company, or at a meeting of any 

class of Members of the Company, shall be entitled to 

appoint not more than two (2) persons as his/her 

proxies to attend and vote instead of the Member at 

the meeting. A proxy may but need not be a Member 

of the Company and there shall be no restriction as to 

the qualification of the proxy and the provisions of 

Section 149(1)(b) of the Act shall not apply to the 

Company. If a member appoints two (2) proxies, the 

appointment shall be invalid unless he/she specifies 

the proportion of his/her shareholdings to be 

represented by each proxy and provided that in the 

case of a vote on any question by a show of hands, 

only one (1) of the proxies so appointed shall be 

entitled to vote on a show of hands. 

Authorised Nominee And Exempt Authorised Nominee 

(1) Where a Member of the Company is an authorised 

nominee as defined under the Central Depositories 

Act, it may appoint not more than two (2) proxies 

in respect of each securities account it holds in 

ordinary shares of the Company standing to the 

credit of the said securities account. 

(2) Where a Member of the company is an exempt 

authorised nominee which holds ordinary shares in 

the Company for multiple beneficial owners in one 

(1) securities account (“omnibus account”), there 

is no limit to the number of proxies which the 

exempt authorised nominee may appoint in 

respect of each omnibus account it holds. 

An exempt authorised nominee refers to an 

authorised nominee defined under the Central 

Depositories Act which is exempted from compliance 

with the provisions of subsection 25A(1) of Central 

Depositories Act.

ANNEXURE A-PROPOSED AMENDMENTS TO THE ARTICLES 

OF ASSOCIATION OF GROMUTUAL BERHAD (continue) 

ARTICLE NO. EXISTING ARTICLES AMENDED ARTICLES 


To insert new Article 

77A 

Article 78 

Form of Proxy 

To amend 

paragraph 1 of the 

Notes to Article 78 

To delete existing 



To amend 



To insert 

new paragraph to the 


Instrument appointing proxy to be in writing 

The instrument appointing a proxy shall be 

in writing under the hand of the appointor 

or of his attorney duly authorized in writing 

or, if the appointor is a corporation, either 

under the corporation’s common seal or 

under the hand of an officer or attorney 

duly authorized. The Directors may but shall 

not be bound to require evidence of the 

authority of any such attorney or officer. A 

proxy may but need not be a Member 

and/or a qualified legal practitioner, an 

approved company auditor or a person 

approved by the Registrar. 

The instrument appointing a proxy shall be 

deemed to confer authority to demand or 

join in demanding a poll. 

None 

Notes: 

A proxy may but need not be a Member 

and/or a qualified legal practitioner, an 

approved company auditor or a person 

approved by the Registrar. 

A member shall be entitled to appoint not 

more than two (2) proxies to attend and 

vote at the same meeting and the 

appointment shall be invalid unless he 

specifies the proportions of his holdings to 

be represented by each proxy. 

Where a member is an authorised nominee 

as defined under the Central Depositories 

Act, it may appoint at least one (1) proxy 

in respect of each securities account it 

holds with ordinary shares of the Company 

standing to the credit of the said securities 

account. 

None 

(3) Where the authorised nominee appoints two 

(2) proxies, or where an exempt authorised 

nominee appoints two (2) or more proxies, the 

proportion of shareholdings to be represented by 

each proxy must be specified in the instrument 

appointing the proxies, failing which the 

appointment shall be invalid. 

Instrument appointing proxy to be in writing 

The instrument appointing a proxy shall be in writing 

under the hand of the appointor or of his attorney 

duly authorised in writing or, if the appointor is a 

corporation, either under the corporation’s common 

seal or under the hand of an officer or attorney duly 

authorised. The Directors may but shall not be bound 

to require evidence of the authority of any such 

attorney or officer. A proxy may but need not be a 

Member of the Company and there shall be no 

restriction as to the qualification of the proxy and the 

provisions of Section 149(1)(b) of the Act shall not 

apply to the Company. 

The instrument appointing a proxy shall be deemed to 

confer authority to demand or join in demanding a 

poll. 

Proxy’s right to speak at meeting 

A proxy appointed to attend and vote at a meeting of 

the Company shall have the same rights as the 

Member to speak at the meeting. 

Notes: 

A proxy may but need not be a Member of the 

Company and there shall be no restriction as to the 

qualification of the proxy and the provisions of Section 

149(1)(b) of the Act shall not apply to the Company. 

Deleted. 

Where a member of the Company is an authorised 

nominee as defined under the Central Depositories 

Act, it may appoint not more than two (2) proxies in 

respect of each securities account it holds in ordinary 

shares of the Company standing to the credit of the 

said securities account. 

Where a member of the Company is an exempt 

authorised nominee which holds ordinary shares in 

the Company for multiple beneficial owners in one (1) 

securities account (“omnibus account”), there is no 

limit to the number of proxies which the exempt 

authorised nominee may appoint in respect of each 

omnibus account it holds. 

Where a member or the authorised nominee appoints 

two (2) proxies, or where an exempt authorised 

nominee appoints two (2) or more proxies, the 

proportion of shareholdings to be represented by 

each proxy must be specified in the instrument 

appointing the proxies, failing which the appointment 

shall be invalid. 

01 05 


06 


STATEMENT ACCOMPANYING 

NOTICE OF ANNUAL GENERAL MEETING 

1. Directors who are standing for re-election at the 10th Annual General Meeting of Gromutual Berhad : 

1.1 Under Article 84 of the Company's Articles of Association : 

• Ms. Chew Kwee Hiok 

• Mr. Yeoh Beng Sang 

• Encik Azahar Bin Baharudin 

2. Further details of Directors standing for re-election are set out in the Directors' Profile appearing on pages 11 

to 12 of this Annual Report. 

3. Particulars of Directors' shareholdings are set out on page 67 of this Annual Report.

GROUP STRUCTURE 

Subsidiary Companies of Gromutual 

AHL : Ayer Hitam Land Sdn. Bhd. AHS : Ayer Hitam Sawmill Company Sdn. Bhd. 

CYH : Cheng Yew Heng Manufactory Sdn. Berhad EPSB : Emerald Park Sdn. Bhd. 

HGSB : Harmony Gallery Sdn. Bhd. HDSB : Hillpark Development Sdn. Bhd. 

IBSB : Idealbase Sdn. Bhd. MPSB : Multinat Property Sdn. Bhd. 

PDSB : Prairie Development Sdn. Bhd. RESB : Rainbow Entity Sdn. Bhd. 

RPSB : Regal Park Sdn. Bhd. SCSB : Sakae Corporation Sdn. Bhd. 

SDSB : Shinwoo Development Sdn. Bhd. SME : Simpang Maju Enterprises Sdn. Bhd. 

SRSB : Summer Range Sdn. Bhd. TPSB : Taman Pahlawan Sdn. Bhd. 

VDSB : Vinlane Development Sdn. Bhd. WDSB : Wisma Development Sdn. Bhd. 

01 07 


08 


FINANCIAL HIGHLIGHTS 

Key Results (RM) 

Revenue 

EBITDA 1 

Profit Before Tax (“PBT”) 

Profit After Tax (“PAT”)/NPAEH 2 

Other Key Data (RM) 

Total Assets 

Total Borrowings 

Shareholders’ Equity 

Financial Ratios 

Return on Total Assets (%) 

Return on Equity (%) 

Gearing Ratio (%) 3 

Interest Coverage 4 (times) 

Share Information 

Earnings Per Shares (Sen) 

Net Dividend Per Share (Sen) 

Net Assets Per Share (RM) 

Net Dividend Yield (%) 5 

Share Price as at 31 December (RM) 

Price Earning Ratio (“PE”) 6 

75,275,992 

11,703,093 

10,678,950 

7,866,667 

283,872,095 

32,969,600 

213,682,915 

2.77 

3.68 

15.43 

4.67 

2.09 

0.37 

0.59 

2.30 

0.161 

7.70 

83,398,688 

16,496,255 

15,414,173 

11,109,536 

276,300,846 

23,356,238 

221,975,391 

4.02 

5.00 

10.52 

7.15 

2.96 

0.75 

0.59 

4.46 

0.168 

5.67 

1 Earnings Before Interest, Taxes, Depreciation and Amortisation 

2 PAT Attributable to Equity Holders 

3 Total Debts/Shareholders' equity 

4 PBT/Interest Charges 

5 Net Dividends Per Share/Price Per Share 

6 Price Per Share/Earning Per Share 

Millions 

120.00 

100.00 

80.00 

60.00 

40.00 

20.00 

0.00 

REVENUE 

2008 2009 2010 2011 2012 

31 Dec 2008 31 Dec 2009 31 Dec 2010 31 Dec 2011 31 Dec 2012 

71,702,696 

16,498,780 

15,278,995 

11,498,910 

309,005,572 

48,976,902 

230,657,241 

Millions 

25.00 

20.00 

15.00 

10.00 

5.00 

0.00 

3.72 

4.99 

21.23 

7.78 

3.06 

0.75 

0.61 

3.40 

0.220 

7.19 

96,103,122 

28,681,620 

27,347,531 

21,403,999 

340,572,641 

60,643,386 

248,774,670 

6.28 

8.60 

24.38 

9.59 

5.70 

0.88 

0.66 

3.91 

0.225 

3.95 

PAT 

104,152,962 

31,146,588 

29,588,901 

22,268,351 

358,666,239 

50,305,238 

265,408,902 

2008 2009 2010 2011 2012 

6.21 

8.39 

18.95 

9.58 

5.93 

1.50 

0.71 

5.77 

0.260 

4.38

CORPORATE INFORMATION 

BOARD OF DIRECTORS 

Tan Hon Kiat @ Tan Hoon Siong Non-Executive Chairman 

Teo Ah Bah @ Teo Chuang Kwee Managing Director 

Chew Kwee Hiok (f) Deputy Managing Director 

Ng Choo Mean Executive Director 

Teo Yu Hong Executive Director 

YH Dato' Chong Keap Thai @ Cheong Keap Tai Independent Non-Executive Director 

Yeoh Beng Sang Independent Non-Executive Director 

Azahar Bin Baharudin Independent Non-Executive Director 

Teo Yu Chin Non independent Non-Executive 

(Alternate Director to Teo Ah Bah @ Teo Chuang Kwee) Director 

01 09 


10 


CORPORATE INFORMATION (continue) 

AUDIT COMMITTEE 

YH Dato' Chong Keap Thai @ Cheong Keap Tai Chairman 

Yeoh Beng Sang Member 

Azahar Bin Baharudin Member 

NOMINATION COMMITTEE 

Yeoh Beng Sang Chairman 

YH Dato' Chong Keap Thai @ Cheong Keap Tai Member 

Tan Hon Kiat @ Tan Hoon Siong Member 

REMUNERATION COMMITTEE 

Tan Hon Kiat @ Tan Hoon Siong Chairman 

YH Dato' Chong Keap Thai @ Cheong Keap Tai Member 

Yeoh Beng Sang Member 

REGISTERED OFFICE COMPANY SECRETARY 

Suite 1301, 13th Floor, City Plaza Yong May Li (f) 

Jalan Tebrau (LS 0000295) 

80300 Johor Bahru 

Johor Darul Takzim 

Tel No.: 607-3354988 

Fax No.: 607-3354977 

BUSINESS OFFICE AUDITORS 

Suite 15.3A, Level 15, Menara Pelangi Deloitte KassimChan (AF 0080) 

No. 2, Jalan Kuning, Taman Pelangi Chartered Accountants 

80400 Johor Bahru No. 21, Jalan Tun Abdul Razak 

Johor Darul Takzim Susur 1/1, 80000 Johor Bahru 

Tel No.: 607-3319317 Johor Darul Takzim 

Fax No.: 607-3322471 Tel No.: 607-2225988 

Website: www.gromutual.com Fax No.: 607-2247508 

SHARE REGISTRAR PRINCIPAL BANKERS 

Tricor Investor Services Sdn. Bhd. AmBank (M) Berhad 

Level 17, The Gardens North Tower CIMB Bank Berhad 

Mid Valley City Malayan Banking Berhad 

Lingkaran Syed Putra Public Bank Berhad 

59200 Kuala Lumpur 

Tel No.: 603-22643883 STOCK EXCHANGE LISTING 

Fax No.: 603-22821886 

Bursa Malaysia Securities Berhad 

(Bursa Securities) 

Main Market

PROFILE OF THE BOARD OF DIRECTORS 

Tan Hon Kiat @ Tan Hoon Siong, aged 67, Malaysian, was appointed as a Non-Executive Chairman of 

Gromutual on 7 February 2005. He graduated from the Nanyang University, Singapore with Bachelor of 

Commerce majoring in Accounting in 1971 and subsequently pursued further study in United Kingdom 

to qualify himself as Chartered Accountant in 1974. Currently, he is a fellow member of Institute of 

Certified Public Accountants of Singapore, a Chartered Accountant of Malaysian Institute of 

Accountants and a fellow member of Association of Chartered Certified Accountants. He set up his 

own public accounting practice in 1980 and has vast experience in the field of auditing, accounting, 

taxation, financial planning and management. Currently he also oversees his family businesses which 

involved in investment holding, plantation and property development. 

Teo Ah Bah @ Teo Chuang Kwee, aged 65, Malaysian, is one of the founders of Gromutual Group and 

was appointed as the Managing Director of Gromutual on 23 November 2004. He graduated from the 

University of Singapore with a Bachelor of Science in Applied Chemistry in 1974. Upon graduation, he 

joined his family company which was involved in timber logging and sawmilling for both export and 

domestic markets. He together with his brother had successfully set up many companies including 

property development, trading and manufacturing companies. He is responsible for the overall 

operations, business development and strategic direction of Gromutual Group. Currently, he is also a 

Non-Executive Chairman of Dominant Enterprise Berhad. 

Chew Kwee Hiok, aged 50, Malaysian, was appointed as an Executive Director of Gromutual on 23 

November 2004. She was appointed as Deputy Managing Director of Gromutual on 1 January 2010. 

She completed her Diploma in Building from Tunku Abdul Rahman College in 1988. Upon graduation, 

she joined one of the leading developers in Johor Bahru as a marketing executive and later joined 

Idealbase Sdn. Bhd. in 1995 as a Director. Currently, she oversees the business operations and activities 

of Gromutual Group. She is also a Registered Real Estate Agent since 1997. 

Ng Choo Mean, aged 67, Malaysian, was appointed as an Executive Director of Gromutual on 23 

November 2004. He is one of the founders and the managing director of the Wisma Development Sdn 

Bhd (“WDSB”) Group. The WDSB group has been actively embarked on housing development on a 

joint-venture basis with various land owners since 1978. 

Teo Yu Hong, aged 35, Malaysian, was appointed as an Executive Director of Gromutual on 29 

November 2010. He graduated from the University of Melbourne with a Bachelor of Civil Engineering in 

2001. After graduation, he joined a concrete products company as sales engineer and later joined 

Gromutual in 2004 as project manager. In 2008, he had been promoted to be the Business 

Development Manager responsible for exploring business venture and opportunity of the group. 

YH Dato' Chong Keap Thai @ Cheong Keap Tai, aged 65, Malaysian, was appointed as an Independent 

Non-Executive Director of Gromutual on 23 November 2004. He graduated from the University of 

Singapore with Bachelor of Accountancy. He is a Chartered Accountant of Malaysian Institute of 

Accountants, a Member of the Malaysian Institute of Certified Public Accountants, member of 

Malaysian Institute of Taxation and licensed Tax Agent, and a Member of the Institute of Chartered 

Secretaries and Administrators. He was the Executive Director and Partner of Coopers & Lybrand and 

upon its merger with Price Waterhouse, he was the Executive Director and Partner of 

PricewaterhouseCoopers and Chairman of the Governance Board of the Firm until his retirement in 

December 2003. Currently, he is a Director of YTL Corporation Berhad, YTL Land & Development Berhad 

and YTL e-Solutions Berhad. 

01 11 


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PROFILE OF THE BOARD OF DIRECTORS (continue) 

Yeoh Beng Sang, aged 65, Malaysian, was appointed as an Independent Non-Executive Director of 

Gromutual on 23 November 2004. He graduated from the University of Malaya with a Bachelor of 

Economics (Hons) in Business Administration in 1974. He is a fellow member of Chartered Tax Institution 

of Malaysia, an approved tax agent and a licensed Company Secretary. Upon graduation, he joined 

the Inland Revenue Board as an Assessment Officer. After accumulated 15 years of experience, he left 

as an Assistant Director in the Investigation Unit of Johor Bahru in 1989 and joined a local management 

consultancy firm as partner. He set up his own management consultancy firm and has vast experience 

in taxation and corporate services. 

Azahar Bin Baharudin, aged 57, Malaysian, was appointed as an Independent Non-Executive Director 

of Gromutual on 28 February 2011. He graduated from MARA Institute of Technology in 1984. He 

began his career in 1978 with United Asian Bank Berhad and joined Affin Bank Berhad in 1991 as an 

Executive Officer. In 1992, he was promoted to Head of Credit and became a Deputy Branch 

Manager of Johor Jaya Branch in 1993. In 1994, he has been promoted as Branch Manager and 

worked in various branches of the Bank in Johor. He served Affin Bank Berhad until 2003 with his last 

position as its Johor, Business Centre Head. He joined Intralink Techno Sdn. Bhd. from November 2005 

to December 2007 and last position as General Manager, Business Development. He currently sits on 

the board of Solid Automotive Berhad. 

Teo Yu Chin (Alternate Director to Teo Ah Bah @ Teo Chuang Kwee), aged 32, Malaysian, was 

appointed as a Non-Independent Non-Executive Director of Gromutual on 1 January 2012. He 

graduated with a Bachelor Degree in Electrical Engineering from Pennsylvania State University, United 

States of America in 2002. He started his career with United Overseas Bank (Malaysia) Berhad as 

Commercial and Corporate Banker in 2003. He joined Vermi Industries Sdn. Bhd. as General Manager 

from 2007 to 2012. Presently, he is an Executive Director in Dominant Enterprise Berhad where he acts 

as Alternate Director to Teo Ah Bah @ Teo Chuang Kwee. 

Family Relationship of Directors 

Save as disclosed below, none of the Directors has any family relationship with any Directors and/or major 

shareholders of the Company:- 

1) Tan Hon Kiat @ Tan Hoon Siong is the brother-in-law of Teo Ah Bah @ Teo Chuang Kwee; 

2) Teo Yu Chin is the son of Teo Ah Bah @ Teo Chuang Kwee; and 

3) Teo Yu Hong is the nephew of Teo Ah Bah @ Teo Chuang Kwee (Managing Director and 

Substantial Shareholder), Teo Choon Kiat @ Teo Chuan Kit (Substantial Shareholder) and son of 

Madam Tan Ah Sim @ Tan Siew Wah (Substantial Shareholder). 

Conflict of Interest 

Save as disclosed in the directors' profile, none of the directors has any conflict of interest with the Company. 

Conviction of Offence 

None of the directors has been convicted of any offence within the past 10 years other then the traffic 

offences. 

Securities Holdings 

The particulars of the directors' shareholdings are set out in page 67 of this Annual Report.

CHAIRMAN'S STATEMENT 

On behalf of the Board of Directors of Gromutual Berhad (“Gromutual” or “the Company”), it is my 

pleasure to present you the 2012 Annual Report and Financial Statements of the Group and of the 

Company for the financial year ended 31 December 2012 (“FY2012”). 

FINANCIAL PERFORMANCE 

The financial year under review for the Group improved further, in view of the generally positive outlook in 

the property sector in the southern region of Malaysia. Group revenue increased to RM104.2 million from 

RM96.1 million previously, on the back of higher take-up of our existing projects and new sales launches in 

the year. 

The higher revenue and higher profit margin had helped to improve group profitability, with profit before 

tax rising 8.4% to RM29.6 million from RM27.3 million previously. Group net profit increased 4.0% to RM22.3 

million in FY2012, compared with RM21.4 million the year before. 

Basic earnings per share stood at 5.93 sen, from 5.70 sen previously. 

The Group’s balance sheet remained healthy, with improved shareholders’ equity of RM265.41 million, 

versus RM248.78 million in the previous year. Total borrowings reduced to RM50.31 million from RM60.64 

million in the previous year, while cash and bank balances improved to RM13.98 million in end-FY2012 from 

RM9.36 million. 

This resulted in the Group’s net gearing improving to 0.14 time, compared to 0.21 time in the previous year. 

DIVIDEND 

The Group had earlier declared an interim single-tier (net of tax) dividend of 2.0% or 1.0 sen per share in 

respect of FY2012. The dividend payout of RM3.76 million was distributed to shareholders on 5 October 

2012. 

The Board is pleased to propose a final single-tier dividend of 1.0% or 0.5 sen per share for shareholders’ 

approval at the upcoming Annual General Meeting. If approved, the Group would have declared a total 

dividend of 3.0% or 1.5 sen per share in respect of FY2012, amounting to dividend payout of RM5.63 million, 

representing 25.3% of group net profit. 

INDUSTRY REVIEW AND FUTURE PROSPECTS 

Property Development Segment 

The property market recorded steady growth pace in the first half of 2012 from higher domestic demand 

which has tapered slightly in the second half of the year, owing to stringent lending measures by financial 

institutions; as well as more intense competition amongst developers. 

The industry also faced other challenges in rising prices of building materials and shortage of construction 

workers resulting from tighter regulatory control on foreign labourers. 

Nonetheless, we believe that the demand for residential and commercial properties will continue to be 

sustained in the coming year. Against this backdrop, the Group will time our new project launches and 

offer right products to meet the demand of the discerning property purchasers. 

Property Investment and Property Management Segment 

The Group recognizes the importance of a steady and recurring income stream from property investment 

and management, to complement the earnings from the property development segment. 

During the year, our student accommodation business in Melaka had faced increased competition. In this 

respect, the Group will plan to undertake continual service improvement and operational efficiency 

measures in the student accommodation facilities to enhance our competitiveness. We believe our 

measures will effectively raise the yield from this segment. 

01 13 


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CHAIRMAN'S STATEMENT (continue) 

Corporate Social Responsibility (“CSR”) 

Over the years, the Group has maintained its initiatives to support and assist various worthy causes in the 

community as part of our CSR programme. To this end, the Group has taken considerable effort in 

enhancing the wellbeing of the Group’s employees as well as the general public. 

With regard to human capital development, the Group continued the practice of conducting in-house 

training programmes and sponsoring employees’ attendance in job-related seminars to enhance their 

technical knowledge and competencies. Furthermore, we reviewed the insurance policy for employees 

to ensure adequate insurance coverage for our personnel. 

The Group will continue to participate in charitable causes through Emerald Club, a charity club funded 

by the directors and the employees of the Group, by giving donations to the needy. At the same time, 

the Group actively encourages employees’ participation in community services by regularly organising 

visits to orphanages, old folks’ homes and other welfare bodies. 

On environmental conservation perspective, our residential projects are designed to protect the nature 

surrounding and ecology. 

APPRECIATION 

On behalf of the Board of Directors, I wish to extend my sincere gratitude to the management and 

staff for their hard work, dedication and steadfast commitment to the Group. My appreciation also 

goes to our customers, tenants, contractors and financiers for their continued confidence, cooperation 

and support. Last but not least, I thank all our directors for their support and cooperation in cohesively 

guiding our Group. 

Thank you. 

On behalf of the Board, 

Tan Hon Kiat @ Tan Hoon Siong 

Non-Executive Chairman 

Date 9 April 2013

STATEMENT ON CORPORATE GOVERNANCE 

The Board of Directors (the “Board”) supports the Malaysian Code on Corporate Governance 2012 

(“the Code”) which sets out the basic principles and best practices to protect and enhance 

shareholders’ value. The following statements describe the Company’s application of the principles 

and the extent of compliances with the best practices of the Code. 

1. Directors 

1.1 The Board of Directors and Board Meeting 

The Group continues to be guided by an experienced Board comprises four (4) Executive Members, 

one (1) Non-Independent Non-Executive Member and three (3) Independent Non-Executive 

Members. The board members are balanced mix with professionals and entrepreneurs who have a 

diverse range of know-how and experiences in relevant fields, encompassing accounting, auditing, 

engineering, construction, taxation and other industries. With the vast experiences of the board 

members, the Board has discharged its duties and responsibilities competently. 

The Board meets regularly to perform its main function on the development and implementation of 

strategic plans, formulation of policies, overseeing the conduct and operations of the businesses of 

the Group and ensuring appropriateness of internal control and effectiveness of risk management. 

During the financial year ended 31 December 2012 four (4) Board Meetings were held. The 

attendance records of the members are as follows:- 

No. of Meetings Held Attendance 

Executive Directors 

Teo Ah Bah @ Teo Chuang Kwee 

(Alternate Director: Teo Yu Chin) 

4 4 

Chew Kwee Hiok (f) 4 4 

Ng Choo Mean 4 4 

Teo Yu Hong 4 4 

Non-Executive Directors 

Tan Hon Kiat @ Tan Hoon Siong 4 4 

YH Dato' Chong Keap Thai @ Cheong Keap Tai (Independent) 4 4 

Yeoh Beng Sang (Independent) 4 4 

Azahar Bin Baharudin (Independent) 4 4 

The Executive Directors are responsible for managing the businesses of the Group in the development 

and implementation of strategies adopted by the Board and the financial and operational 

performance of the Group. 

The Independent and Non-Executive Directors play an important role in ensuring that the strategies 

proposed by the management are fully deliberated and examined, to ensure that the interest of all 

shareholders and general public are given due considerations in the decision-making process. 

One of the recommendations of the Code states that the tenure of an independent director should 

not exceed a cumulative term of 9 years. The Board holds the view that YH Dato’ Chong Keap Thai @ 

Cheong Keap Tai and Yeoh Beng Sang, both of whom will have served the Board for a cumulative 

term of 9 years by 22 November 2013 shall remain objective and independent in carrying out their 

roles and responsibilities as members of the Board and Board Committees. The length of their service 

does not interfere with their ability and exercise of independent judgment as Independent Directors. 

1.2 Board Committees 

The Board has delegated certain responsibilities to the Board Committees, namely Audit Committee, 

Nomination Committee and Remuneration Committee, all of which operate within their respective 

defined Terms of Reference. 

1.3 Supply of Information 

The agenda and board papers for each scheduled board meeting are circulated to all Board members 

for their review in advance to enable them opportunity to seek clarification on the issues to be 

deliberated at the Board meeting. Where necessary, the Directors may seek independent professional 

advice at the Group’s expense. 

Besides having regular Board meetings, the Board also made certain decisions and control on matters 

through circulation of Directors’ Resolutions. 

01 15 


16 


STATEMENT ON CORPORATE GOVERNANCE (continue) 

1.4 Nomination Committee (NC) 

The Nomination Committee is responsible for reviewing the existing mix of skills and experience of the 

Directors of the Board to maintain the Board balance and size of non-executive participation on an 

ongoing basis. Besides assessing the appointments, re-appointment and re-election of the members 

to the Board, the Nomination Committee is also responsible for evaluating the effectiveness of the 

Board as a whole and of the committees of the Board on yearly basis. The Committee also 

recommended the retiring directors for re-election in accordance with the Company’s Articles of 

Associations at the Company’s forthcoming Annual General Meeting. 

During the year under review, the Board has found that the current mix of skills and experience of its 

members is sufficient for the effective discharge of its duties and responsibilities. 

The NC members and the attendance records are as follows:- 


Nomination Committee 

Yeoh Beng Sang (Chairman) 2 2 

Tan Hon Kiat @ Tan Hoon Siong 2 2 

YH Dato’ Chong Keap Thai @ Cheong Keap Tai 2 2 

1.5 Directors' Training 

During the financial year ended 31 December 2012, the Directors have attended various workshops, 

seminars and conferences organised by the regulatory authorities and professional bodies to 

broaden their knowledge and to keep abreast with the latest regulatory requirements and 

developments. The programmes attended by the Directors include National Tax Conference, 2013 

Budget & Tax Planning, Updates on Financial Reporting Standards (“FRS”) 2012, Revised FRSs, Keys 

Amendments to Listing Requirements 2012 and Enterprise Risk Management. 

2. Directors' Remuneration 

The Remuneration Committee reviews the remuneration policy and the performance of the Directors 

annually. The Remuneration Committee revises the said policy when needs arise. 

The Remuneration Committee was formed to assist the Board in determining, developing and 

recommending an appropriate remuneration policy and remuneration package for Directors. 

The Remuneration Committee members and the attendance records are as follows:- 


Remuneration Committee 

Tan Hon Kiat @ Tan Hoon Siong (Chairman) 1 1 

Yeoh Beng Sang 1 1 

YH Dato’ Chong Keap Thai @ Cheong Keap Tai 1 1 

The remuneration of all directors for the financial year ended 31 December 2012 is summarised as 

below:- 

Executive Non-Executive 

Directors Directors Total 

RM RM RM 

Fees - 184,000 184,000 

Salary & Other Emoluments 868,240 - 868,240 

Meeting Allowances 8,000 8,000 16,000 

876,240 192,000 1,068,240


The number of directors whose total remuneration fall within the following bands for current financial 

year is set out below:- 

Number of Director 

Executive Non-Executive 

Directors Directors 

Range of Remuneration 

Below RM 50,000 - 3 

RM 50,000 - RM 100,000 - - 

RM 100,001 - RM 150,000 1 1 

RM 150,001 - RM 200,000 1 - 

RM 200,001 - RM 250,000 1 - 

RM 250,001 - RM 300,000 - - 

RM 300,001 - RM 350,000 1 - 

3. Relations with Shareholders 

The Board provides timely disclosure of all material information of the Group to the shareholders through 

release of quarterly financial results, announcements and distribution of Annual Reports. The General 

Meetings (the “GM”) serves as the principal communication platform between the shareholders and 

the Board. During the GM, the shareholders are encouraged to raise question and seek clarification on 

the business activities of the Group, agenda of the meetings and its proposed resolutions. 

01 17 


18 



4. Accountability and Audit 

4.1 Financial Reporting 

The Board through the review by the Audit Committees and in consultation with the External Auditors 

presents fair and meaningful assessment of the Group's financial performance and position. The Board 

is also responsible for ensuring that:- 

i) Appropriate accounting policies adopted have been consistently applied; 

ii) the financial statements are prepared on a going-concern basis and complied with the relevant 

governing policies and standards; and 

iii) all estimations made are prudent and reasonable. 

4.2 Internal Control 

The Board recognises the importance of sound internal control for good corporate governance. As 

such, an internal audit function was established in-house to assist the Audit Committee in reviewing the 

state of internal control of the Group and to highlight areas for management’s improvement. The cost 

incurred for the internal audit function in respect of financial year ended 31 December 2012 is 

approximately RM30,000. 

The state of internal control of the Group is explained in greater detail on page 21 of this Annual Report. 

4.3 Relationship with Auditors 

The Board always maintains professional and transparent relationship with the External Auditors. 

The External Auditors are invited to discuss the annual financial statements, their Audit Plans, and to 

report their findings and other special matters that require the Board’s attention. 

5. Directors' Responsibility Statement 

The Board is responsible for the financial statement of the Company and Group to present a true and 

fair view of the financial position of the Company and of the Group as at the end of each financial year 

and of the financial performance and the cash flows of the Company and of the Group for the financial 

year then ended. 

In preparing the financial statements, the Board through the assistance of Audit Committee, has 

taken various steps to ensure that:- 

i) Appropriate accounting policies are adopted and applied consistently; 

ii) Estimates and judgements made are prudent and reasonable; 

iii) Malaysian accounting standards are complied; 

iv) The financial statements are prepared in compliance with the Companies Act, 1965 and Main 

Market Listing Requirements of Bursa Securities; and 

v) The financial information announced to Bursa Securities is accurate, up-to-date and on timely basis. 

6. Other Information 

a) Material Contract 

There were no material contracts involving Directors or major shareholders other than those in the 

annual report and in the financial statements. 

b) Options, Warrants or Convertible Securities 

During the financial year ended 31 December 2012, the Company has not issued any options, 

warrants or convertible securities. 

c) Share Buy-Backs 

During the financial year ended 31 December 2012, the Company has not entered into any share 

buy-backs transactions. 

This statement is made in accordance with a resolution of the Board of Directors dated 9 April 2013.

AUDIT COMMITTEE REPORT 

1. Committee Members 

The members of the Audit Committee as at the date of this Annual Report are as follows:- 

Name Designation Directorship 

YH Dato' Chong Keap Thai Chairman Independent Non-Executive Director 

@ Cheong Keap Tai (Member of MIA) 

Yeoh Beng Sang Member Independent Non-Executive Director 

Azahar Bin Baharudin Member Independent Non-Executive Director 

2. TERMS OF REFERENCE 

The Terms of Reference of the Audit Committee for the year 2012 are summarised as below:- 

2.1 Authority 

The Committee is authorised by the Board, in accordance with the procedures to be determined 

by the Board (if any) and at the cost of the Company, to: 

(a) examine any activity within the Committee's term of reference; 

(b) have resources which are reasonably required to enable it to perform its duties; 

(c) have full and unrestricted access to any information pertaining to the Company or the Group; 

(d) have direct communication channels with the external auditors and person(s) carrying out 

the internal audit function or activity (if any); 

(e) obtain outside legal or other independent professional advice and secure the attendance of 

outsiders with relevant experience and expertise if it considers this necessary; and 

(f) convene meetings with the external auditors, internal auditors or both, excluding the attendance 

of other directors and employees of the Company, whenever deemed necessary but at least 

twice a year. 

2.2 Duties 

The duties of the Committee shall be to review the following and report the same to the Board:- 

(a) any matters concerning the appointment and dismissal of the external auditor and the audit fee; 

(b) the nature and scope of the audit by the external auditors before commencement; 

(c) the external auditors' audit report, areas of concern arising from the audit and any other 

matters the external auditors may wish to discuss (in the absence of management if necessary); 

(d) any financial information for publication, including quarterly and annual financial statements, 

before submission to the Board, focusing particularly on : 

• Changes in implementation of major accounting policy changes; 

• Significant and unusual events; and 

• Compliance with accounting standards and legal requirement; 

(e) the external auditors' management letter and management's response; 

(f) the adequacy of the competency and relevance of the scope, functions and resources of 

internal audit and the necessary authority to carry out its work; 

(g) the audit plan and work programme of internal audit; 

(h) findings of internal audit work and management's response; 

(i) any evaluations on internal controls by auditors; 

(j) extent of cooperation and assistance given by the employees; 

(k) the propriety of any related party transactions and conflict of interest situations that may arise 

within the Company or the Group; and 

(l) any other matter as directed by the Board. 

2.3 Overseeing The Internal Audit Function 

(a) the Committee shall oversee all internal audit functions and is authorised to commission 

investigations to be conducted by internal auditor as it deem fit; 

(b) the internal auditor shall report directly to the Committee and shall have direct access to the 

Chairman of the Committee; and 

(c) all proposals by management regarding the appointment, transfer or dismissal of the internal 

auditor shall require the prior approval of the Committee. 

2.4 Quorum for Meetings 

The quorum shall be formed only if there is a majority of members present at the meeting who are 

independent directors. 

01 19 


20 


AUDIT COMMITTEE REPORT (continue) 

2.5 Attendance at Meetings 

(a) Finance Manager, Accounts Manager, the Company Secretary and the Head of Internal 

Audit shall normally attend meetings. The Managing Director, Deputy Managing may be invited 

to attend the meeting; 

(b) representatives of the external auditors shall attend the meeting to consider the final audited 

financial statements and such other meetings determined by the Committee; and 

(c) non-member directors shall not attend unless specifically invited to by the Committee. 

2.6. Frequency of Meetings 

The Chairman of the Audit Committee shall call for meetings, to be held not less than four (4) times a 

year. The external auditors may request a meeting if they consider one necessary. 

2.7 Reporting Procedures 

(a) the Company Secretary shall be the Secretary of the Committee. She shall record attendance 

of all members and invitees and minute down the proceedings of every meeting of the 

Committee. All minutes of meetings shall be circulated to every member of the Board; 

(b) the Committee shall prepare an annual report to the Board that provides a summary of the 

activities of the Committee for inclusion in the Company's annual report; 

(c) the Committee shall assist the Board in preparing the following for publication in Company's 

annual report: 

(i) Statement on the Company's application of the principles set out in Part 1 of the Malaysian 

Code on Corporate Governance; 

(ii) Statement on the extent of compliance with the Best Pratices in Corporate Governance set 

out in Part 2 of the Malaysian Code on Corporate Governance, specifying reasons for any 

areas of non compliance (if any) and the alternatives adopted in such areas; 

(iii) Statement on the Board's responsibility for preparing the annual audited financial statements; 

(iv) Statement about the state of internal control of the Group; and 

(v) Statement on Internal Audit function to disclose whether the Internal Audit function is 

performed in-house or outsourced and the cost incurred for the Internal Audit function in 

respect of the financial year. 

(d) the Committee may report any breaches of the Listing Requirements, which have not been 

satisfactorily resolved, to the Bursa Securities. 

3. Summary of Activities 

During the financial year ended 31 December 2011, the Audit Committee had carried out all its duties in 

accordance with the terms of reference. The attendance records of the members of the Audit 

Committee meeting are as follows:- 

Designation No. of Meetings Held Attendance 

Audit Committee 

YH Dato' Chong Keap Thai @ Cheong Keap Tai Chairman 4 4 

Yeoh Beng Sang Member 4 4 

Azahar Bin Baharudin Member 4 4 

The Audit Committee met with the Group's external auditors in separate meetings twice in the year without the 

presence of the Management, to brief the Audit Committee on specific issues (if any) that arose from 

the performance of the annual audit of the Group. 

4. Internal Audit Functions 

The Group has established an Internal Audit Team (“IA Team”) to undertake the internal audit functions 

that would enable the Audit Committee to discharge its duties. The Audit Committee identified areas 

which require assessment and review by the IA Team. IA Team draws out the internal audit plans for 

Audit Committee’s approval. The review carried-out by Internal Audit team was based on the 

approved audit plan during the financial year ended 31 December 2012. 

The IA Team presented significant weaknesses and recommendations of appropriate measures to 

mitigate those weaknesses to the Audit Committee for their deliberation and advice to the Board. 

Overview of the Group’s approach in maintaining a sound system of internal control is stated in the 

Statement on Risk Management and Internal Control on page 21 of this Annual Report. 

This report is made in accordance with a resolution of the Board dated 9 April 2013.

STATEMENT ON RISK MANAGEMENT AND INTERNAL 

CONTROL 

The Board is pleased to present the following Statement which outlines the Internal Control in 

accordance with the Statement on Risk Management and Internal Control Guidance 

(“Guidance”) adopted by Bursa Securities. 

Key Elements and Processes 

The key principles of the Group's internal control system are described below: 

(i) A clear organisation structure that defined areas of responsibility and delegation of authority are in 

place for proper identification of accountabilities and segregation of duties; 

(ii) The “close-to-operations” management style to enable timely identification and rectification of 

issues arising from business operations and other related issues, as well as to ensure business 

strategies are aligned to corporate plan. Significant matters identified are highlighted to the 

Board on timely basis; 

(iii) Conduct regular meetings and site visits to review operational goals and budgets, oversee the Group's 

financial performance, operation teams' performance, as well as enable close communication 

among Management and operation teams; 

(iv) Conveys the latest changes to the governing rules and regulations to the relevant personnel on 

timely basis and assigns appropriate personnel to attend in-house and external seminars that are 

relevant in performing their duties and responsibilities; 

(v) Identify the related party transactions, if any and ensure proper disclosure is made on timely basis. 

(vi) Internal audit team performed internal audit on areas of concern specified in the internal plan 

which was approved by the Audit Committee. Internal audit team reported only the significant 

weakness and mitigate actions to the Audit Committee after meeting with Management to 

discuss the audit findings and developed implement plans. The Audit Committee will recommend to 

the Board for implementation; 

(vii) The internal audit team also visited the key business units to review the adequacy and effectiveness 

of certain system of internal controls and compliances with operation policies and procedures. They 

also highlighted the changes to governing rules and regulations and assisted on the revision of the 

operation policies and procedures; and 

(viii) The external auditors have considered the internal controls relevant to the Group in making the risk 

of material misstatement of the financial statements. Any material deficiencies and irregularities 

noted will be presented in the management letters and will be submitted to the Audit Committee 

for recommendation to the Board. 

Risk Management Framework 

The risk assessment process involved continuous review and evaluation of risks identified, prioritisation 

and formulation of appropriate action plans to enhance a sound internal controls system. This process 

has been in place for the year under review and up to the date of approval of this annual report. As 

part of the commitment to monitor and manage risk that affects the performance of the Group, the 

Risk Management Committee (“RMC”) carried out risk assessment process on annual basis to 

identify significant risks and ensure appropriate actions had been taken by the Management to 

manage and mitigate such risks. The RMC also assist the Board to establish and implement 

adequate preventive and corrective actions to mitigate such risk. 

The Board is satisfied and as also assured and confirmed by the Managing Director and the Deputy 

Managing Director that the risk management and internal control system are operating satisfactorily and 

has not resulted in any significant breakdown or weaknesses that would cause any material loss to the 

Group for the financial year ended 31 December 2012. 

This statement is made in accordance with a resolution of the Board dated 9 April 2013. 

01 21 


22 


MANAGEMENT'S OPERATIONS REVIEW 

The Group has two business segments as follows:a) 

Property Development; and 

b) Property Management 

Property Development 

The property development segment remained the Group’s largest revenue contributor in FY2012, 

with top line improving 9.5% year-on-year to RM95.05 million compared to RM86.80 million previously. 

This is primarily attributed to favourable response to our existing residential projects and higher 

revenue recognition in tandem with quicker construction progress ahead of schedules. 

At the same time, the Group also noted strong sales for our Industrial Park in Johor. We believe that 

this is in line with the growing number of domestic and regional manufacturers attracted to the 

state’s proposition as a viable investment destination. 

The Group also witnessed positive take-up of our new launches in the year under review with the 

total Gross Development Value (GDV) of RM133.60 million in FY2012. 

The Group’s ongoing and new projects have total GDV of more than RM200 million as at 

end-December 2012. 

Going forward, the property and construction sector is largely anticipated to face challenging 

prospects mainly in terms of labour shortage and keener competition. 

That said, the Government’s ongoing investments in the infrastructure and increased private sector 

participation in economic development are envisaged to boost property sectors by attracting even 

more investments from the local and foreign investors. This would result in long-term multiplier 

benefits to the economy. 

Therefore, we remain committed to offering right property products that meet customers’ tastes and 

lifestyles. To this end, the Group intends to embark on the high-rise commercial development in 

Johor Bahru to cater for the more discerning demand in the near future. 

Property Management 

Despite the stiff competition amongst student accommodation providers in the year under review, 

revenue from the Group’s property management segment rose to RM7.56 million in FY2012. This was 

attributed to the increased capacity of students’ accommodation through the high-rise student 

apartments known as ‘Emerald Residence’, which was open to students since June 2011. 

The Group will continue to implement service improvement measures to enhance the quality of the 

facilities of the hostel to attract and retain students. 

The Group continued to enjoy favourable yield from the industrial properties, as majority of the 

tenants had renewed and extended their tenancy. We are optimistic that the rental income from 

industrial properties will continue to improve in the coming year, in line with the prevailing market 

trends. The Group had also disposed of certain industrial buildings where their full values had been 

attained during the year as part of its portfolio management strategy. 

The Group will also be on the constant lookout for high-yield properties to add to our investment 

portfolio and boost this recurring income stream. 


Managing Director

FINANCIAL STATEMENTS 

24 

28 

29 

30 

31 

32 

33 

65 

65 

Directors' report 

Independent auditors' report 

Statements of comprehensive income 

Statements of financial position 

Statements of changes in equity 

Statements of cash flows 

Notes to the financial statements 

Statement by directors 

Declaration by the director primarily responsible 

for the financial management of the Company 

01 23 


24 


DIRECTORS' REPORT 

The directors of GROMUTUAL BERHAD have pleasure in submitting their report and the audited financial 

statements of the Group and of the Company for the financial year ended 31 December 2012. 

PRINCIPAL ACTIVITIES 

The Company is principally involved in investment holdings and provision of management services to 

the subsidiary companies. 

The principal activities of the subsidiary companies are disclosed in Note 15 to the Financial 

Statements. 

There have been no significant changes in the nature of the principal activities of the Company and its 

subsidiary companies during the financial year. 

RESULTS OF OPERATIONS 

The results of operations of the Group and of the Company for the financial year are as follows: 

The Group The Company 

RM RM 

Profit for the year 

Profit attributable to: 

22,268,351 8,796,062 

Owners of the Company 22,268,351 8,796,062 

In the opinion of the directors, the results of operations of the Group and of the Company during the 

financial year have not been substantially affected by any item, transaction or event of a material and 

unusual nature. 

DIVIDENDS 

A final dividend of 1%, single tier amounting to RM1,878,040 proposed in the previous financial year 

and dealt with in the previous year directors’ report was paid by the Company on 27 June 2012. 

Since the end of the previous financial year, an interim dividend of 2%, single tier amounting to 

RM3,756,079 was paid on 5 October 2012 in respect of the current financial year. 

The directors proposed a final dividend of 1%, single tier amounting to RM1,878,040 in respect of the 

current financial year. The proposed final dividend is subject to the approval by the shareholders at the 

forthcoming Annual General Meeting of the Company and has not been included as liability in the 

financial statements. Upon approval by the shareholders, the cash dividend payment will be 

accounted for in equity as an appropriation of retained earnings during the financial year ending 31 

December 2013. 

RESERVES AND PROVISIONS 

There were no material transfers to or from reserves or provisions during the financial year other than 

those disclosed in the financial statements. 

ISSUE OF SHARES AND DEBENTURES 

The Company has not issued any new shares or debentures during the financial year. 

SHARE OPTIONS 

No options have been granted by the Company to any parties during the financial year to take up 

unissued shares of the Company.

DIRECTORS' REPORT (continue) 

No shares have been issued during the financial year by virtue of the exercise of any option to take up 

unissued shares of the Company. As of the end of the financial year, there were no unissued shares of the 

Company under options. 

OTHER STATUTORY INFORMATION 

Before the statements of comprehensive income and the statements of financial position of the Group 

and of the Company were made out, the directors took reasonable steps: 

(a) to ascertain that proper action had been taken in relation to the writing off of bad debts and the 

making of allowance for doubtful debts and had satisfied themselves that there were no known bad debts 

to be written off nor any allowance for doubtful debts to be made; and 

(b) to ensure that any current assets which were unlikely to realise their book values in the ordinary 

course of business had been written down to their estimated realisable values. 

As of the date of this report, the directors are not aware of any circumstances: 

(a) which would require the writting off as bad debts or the making of allowance for doubtful debts in the 

financial statements of the Group and of the Company; or 

(b) which would render the values attributed to current assets in the financial statements of the Group 

and of the Company misleading; or 

(c) 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 

(d) not otherwise dealt with in this report or financial statements which would render any amount stated 

in the financial statements of the Group and of the Company misleading. 

As of the date of this report, there does not exist: 

(a) 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 

(b) any contingent liability of the Group and of the Company which has arisen since the end of the 

financial year. 

No contingent or other liability has become enforceable, or is likely to become enforceable within the 

period of twelve months after the end of the financial year which, in the opinion of the directors, will or 

may substantially affect the ability of the Group and of the Company to meet their obligations as and 

when they fall due. 

In the opinion of the directors, 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 which is likely to 

affect substantially the results of the operations of the Group and of the Company for the financial 

year in which this report is made. 

DIRECTORS 

The following directors served on the Board of the Company since the date of the last report: 

Tan Hon Kiat @ Tan Hoon Siong 


Chew Kwee Hiok 

Ng Choo Mean 

Teo Yu Hong 

YH Dato' Chong Keap Thai @ Cheong Keap Tai 

Yeoh Beng Sang 

Azahar Bin Baharudin 

Teo Yu Chin (alternate to Teo Ah Bah @ Teo Chuang Kwee) 

01 25 


26 



DIRECTORS' INTERESTS 

The shareholdings in the Company of those who were directors as of the end of the financial year, as 

recorded in the Register of Directors’ Shareholdings kept by the Company under Section 134 of the 

Companies Act, 1965, are as follows: 

Shares in the Company 

Registered in the name of directors 

Direct interest 

No. of ordinary shares of RM0.50 each 

Tan Hon Kiat @ Tan Hoon Siong 5,131,025 - - 5,131,025 

Teo Ah Bah @ Teo Chuang Kwee 14,523,986 - - 14,523,986 

Chew Kwee Hiok 2,058,094 - - 2,058,094 

Ng Choo Mean 2,300,000 - - 2,300,000 

Teo Yu Hong 9,957,973 - - 9,957,973 

Teo Yu Chin 9,000,000 - - 9,000,000 

Indirect interest 

Tan Hon Kiat @ Tan Hoon Siong 17,184,626 - - 17,184,626 

Teo Ah Bah @ Teo Chuang Kwee 41,136,273 - - 41,136,273 

Yeoh Beng Sang 40,000 - - 40,000 

Teo Yu Hong 48,500,000 - - 48,500,000 

By virtue of Mr. Tan Hon Kiat @ Tan Hoon Siong, Mr. Teo Ah Bah @ Teo Chuang Kwee and Mr. Teo Yu 

Hong’s interests in the shares of the Company, they are also deemed to have an interest in the shares 

of all the subsidiary companies to the extent that the Company has interest. 

None of the other directors in office at the end of the financial year, held shares or had any 

beneficial interest in the shares of the Company or its related companies during or at the beginning 

and end of the financial year. 

DIRECTORS' BENEFITS 

Balance as 

of 1.1.2012 Bought Sold 

Balance as 

of 31.12.2012 

Since the end of the previous financial year, none of the directors of the Company has received or 

become entitled to receive any benefit (other than the benefit included in the aggregate amount of 

emoluments received or due and receivable by directors as disclosed in the financial statements) by 

reason of a contract made by the Company or a related corporation with the director or with a firm of 

which he is a member or with a company in which he has a substantial financial interest except for any 

benefit which may be deemed to have arisen by virtue of the transactions between the Company and 

its related companies and certain companies in which certain directors of the Company are also 

directors and/or substantial shareholders as disclosed in Note 19 to the Financial Statements. 

During and as of the end of the financial year, no arrangement subsisted to which the Company was a 

party whereby directors of the Company might acquire benefits by means of the acquisition of shares 

in, or debentures of, the Company or any other body corporate.


AUDITORS 

The auditors, Messrs. Deloitte KassimChan, have indicated their willingness to continue in office. 

Signed on behalf of the Board 

in accordance with a resolution of the Directors, 

TAN HON KIAT @ 

TAN HOON SIONG 

TEO AH BAH @ 

TEO CHUANG KWEE 

Johor Bahru 

25 February 2013 

01 27 


28 


INDEPENDENT AUDITORS’ REPORT 

TO THE MEMBERS OF GROMUTUAL BERHAD 

(Incorporated in Malaysia) 

Report on the Financial Statements 

We have audited the financial statements of Gromutual Berhad which comprise the statements of financial 

position of the Group and of the Company as of 31 December 2012 and the statements of comprehensive 

income, statements of changes in equity and statements of cash flow of the Group and of the Company for the 

year then ended, and a summary of significant accounting policies and other explanatory information, as set out 

on pages 29 to 63. 

Directors' Responsibility for the Financial Statements 

The directors of the Company are responsible for the preparation of financial statements that give a true and fair 

view in accordance with Financial Reporting Standards and the Companies Act, 1965 in Malaysia and for such 

internal control as the directors determine is necessary to enable the preparation of financial statements that are 

free from material misstatement, whether due to fraud or error. 

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 the auditors’ judgement, including the assessment of 

the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk 

assessments, the auditors consider internal control relevant to the entity’s preparation of financial statements that 

give a true and fair view 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 entity’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 that 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 2012 and of their financial performance and cash flows for 

the year then ended. 

Report on Other Legal and Regulatory Requirements 

In accordance with the requirements of the Companies Act, 1965 in Malaysia, we also report that: 

(a) in our opinion, the accounting and other records and the registers required by the Act to be kept by the 

Company and by the subsidiary companies have been properly kept in accordance with the provisions 

of the Act; 

(b) we are satisfied that the accounts of the subsidiary companies that have been consolidated with the 

financial statements of the Company 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 as required by us for those purposes; and 

(c) our auditors' reports on the accounts of the subsidiary companies were not subject to any qualification 

and did not include any adverse comment made under Section 174 (3) of the Act. 

Other Reporting Responsibilities 

The supplementary information set out in Note 30 is disclosed to meet the requirement of Bursa Malaysia 

Securities Berhad and is not part of the financial statements. The directors are responsible for the preparation of 

the supplementary information in accordance with Guidance on Special Matter No. 1 “Determination of 

Realised and Unrealised Profits or Losses in the Context of Disclosure Pursuant to Bursa Malaysia Securities Berhad 

Listing Requirements” as issued by the Malaysian Institute of Accountants ("MIA Guidance") and the directive of 

Bursa Malaysia Securities Berhad. In our opinion, the supplementary information is prepared, in all material 

respects, in accordance with the MIA Guidance and the directive of Bursa Malaysia Securities Berhad. 

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 towards any other 

person for the contents of this report. 

DELOITTE KASSIMCHAN CHAN CHONG WEY 

AF 0080 Partner - 2884/07/13(J) 

Chartered Accountants Chartered Accountant 


Johor Bahru

STATEMENTS OF COMPREHENSIVE INCOME 

FOR THE YEAR ENDED 31 DECEMBER 2012 

Revenue 

Cost of sales 

Gross profit 

Investment revenue 

Other income 

Administrative expenses 

Finance costs 

Other expenses 

Profit before tax 

Income tax expense 

Profit for the year/Total 

comprehensive income 

for the year 

Profit attributable to: 

Owners of the Company 

Earnings per share 

Basic/Diluted (sen) 


2012 2011 2012 2011 

Note(s) RM RM RM RM 

4&5 

6 

7 

8 

10 

11 

104,152,962 

(64,303,887) 

39,849,075 

98,306 

2,469,865 

(11,862,214) 

(959,710) 

(6,421) 

29,588,901 

(7,320,550) 

22,268,351 

22,268,351 

5.93 

96,103,122 

(62,439,468) 

33,663,654 

93,864 

5,109,652 

(10,899,788) 

(597,173) 

(22,678) 

27,347,531 

(5,943,532) 

21,403,999 

21,403,999 

5.70 

The accompanying Notes form an integral part of the Financial Statements. 

11,550,224 

- 

11,550,224 

22,927 

- 

(1,484,286) 

- 

- 

10,088,865 

(1,292,803) 

8,796,062 

8,796,062 

6,561,200 

- 

6,561,200 

12,529 

- 

(1,370,193) 

- 

- 

5,203,536 

(1,077,760) 

4,125,776 

4,125,776 

01 29 


30 


STATEMENTS OF FINANCIAL POSITION 

AS OF 31 DECEMBER 2012 

ASSETS 

Non-current Assets 

Property, plant and equipment 

Investment properties 

Land held for property 

development 

Investment in subsidiary 

companies 

Total Non-current Assets 

Current Assets 

Inventories 

Land and development 

expenditure 

Receivables 

Amount owing by subsidiary 

companies 

Current tax assets 

Cash and bank balances 

Total Current Assets 

Total Assets 

EQUITY AND LIABILITIES 

Capital and Reserves 

Share capital 

Retained earnings 

(Accumulated losses) 

Total Equity 

Non-current Liabilities 

Bank borrowings 

Deferred tax liabilities 

Total Non-current Liabilities 

Current Liabilities 

Payables 


Amount owing to a subsidiary 

company 

Current tax liabilities 

Total Current Liabilities 

Total Liabilities 

Total Equity and Liabilities 


2012 2011 2012 2011 

Note RM RM RM RM 

12 

13 

14 

15 

16 

17 

18 

19 

20 

21 

22 

23 

24 

22 

19 

2,363,920 

83,479,201 

155,419,543 

- 

241,262,664 

5,384,167 

57,461,356 

39,868,478 

- 

706,613 

13,982,961 

117,403,575 

358,666,239 

187,803,980 

77,604,922 

265,408,902 

19,454,736 

6,635,932 

26,090,668 

32,865,582 

30,850,502 

- 

3,450,585 

67,166,669 

93,257,337 

358,666,239 

1,987,939 

87,626,251 

171,095,933 


- 

260,710,123 

6,178,779 

32,288,405 

31,090,972 

- 

940,237 

9,364,125 

79,862,518 

340,572,641 

187,803,980 

60,970,690 

248,774,670 

26,102,667 

7,266,641 

33,369,308 

21,579,462 

34,540,719 

- 

2,308,482 

58,428,663 

91,797,971 

340,572,641 

- 

- 

- 

170,830,419 

170,830,419 

- 

- 

4,403,900 

9,650,000 

- 

3,612,528 

17,666,428 

188,496,847 

187,803,980 

(2,548,855) 

185,255,125 

- 

- 

- 

221,575 

- 

3,000,000 

20,147 

3,241,722 

3,241,722 

188,496,847 

- 

- 

- 

170,830,419 

170,830,419 

- 

- 

1,949 

10,764,300 

- 

738,146 

11,504,395 

182,334,814 

187,803,980 

(5,710,798) 

182,093,182 

- 

- 

- 

212,000 

- 

- 

29,632 

241,632 

241,632 

182,334,814

STATEMENTS OF CHANGES IN EQUITY 


The Group 

Balance as of 1 January 2011 


comprehensive income for the year 

Dividends 

Balance as of 31 December 2011 



Dividends 


The Company 




Dividends 




Dividends 


Attributable to Owners of the Company 

Distributable 

Reserve 

Retained 

Earnings 

Share (Accumulated Total 

Capital Losses) Equity 

Note RM RM RM 

26 

26 

26 

26 

187,803,980 

- 

- 

187,803,980 

- 

- 

187,803,980 

187,803,980 

- 

- 

187,803,980 

- 

- 

187,803,980 


42,853,261 

21,403,999 

(3,286,570) 

60,970,690 

22,268,351 

(5,634,119) 

77,604,922 

(6,550,004) 

4,125,776 

(3,286,570) 

(5,710,798) 

8,796,062 

(5,634,119) 

(2,548,855) 

230,657,241 

21,403,999 

(3,286,570) 

248,774,670 

22,268,351 

(5,634,119) 

265,408,902 

181,253,976 

4,125,776 

(3,286,570) 

182,093,182 

8,796,062 

(5,634,119) 

185,255,125 

01 31 


32 


STATEMENTS OF CASH FLOWS 


CASH FLOWS FROM (USED IN) 

OPERATING ACTIVITIES 

Receipts from customers 

Payments to suppliers and employees 

Cash Generated From (Used In) 

Operations 

Finance costs paid 

Income taxes paid 

Income taxes refunded 

Net Cash From (Used In) 

Working Capital 

Payments for: 

Land held for property development 

Net Cash Generated From 

(Used In) Operating Activities 

CASH FLOWS FROM (USED IN) 

INVESTING ACTIVITIES 

Proceeds from disposal of: 

Investment property 


Interest received 

Dividends received 

Additions to: 



Net repayments from (advances 

to) subsidiary companies 

Net Cash Generated From (Used In) 

Investing Activities 

CASH FLOWS USED IN 

FINANCING ACTIVITIES 

Proceeds from term loans 

Dividend paid 

Repayments of: 

Hire-purchase payables 

Term loans 

Bridging loan 

Net Cash Used In Financing Activities 

NET INCREASE (DECREASE) IN CASH 

AND CASH EQUIVALENTS 

CASH AND CASH EQUIVALENTS 

AT BEGINNING OF YEAR 

CASH AND CASH EQUIVALENTS 

AT END OF YEAR 


2012 2011 2012 2011 


111,545,496 

(66,629,145) 

44,916,351 

(3,056,495) 

(6,654,035) 

78,503 

35,284,324 

(20,350,566) 

14,933,758 

6,375,000 

50 

98,306 

- 

(275,669) 

(630,380) 

- 

5,567,307 

2,108,314 

(5,634,119) 

(181,318) 

(8,418,247) 

- 

(12,125,370) 

8,375,695 

(22,641,220) 

(14,265,525) 

101,056,556 

(61,244,430) 

39,812,126 

(2,658,601) 

(5,412,462) 

18,563 

31,759,626 

(32,170,501) 

(410,875) 

- 

199,950 

99,407 

- 

(6,931,869) 

(1,061,018) 

- 

(7,693,530) 

9,676,686 

(3,286,570) 

(370,206) 

(7,613,631) 

(796,551) 

(2,390,272) 

(10,494,677) 

(12,146,543) 

(22,641,220) 


25 

1,418,400 

(5,876,662) 

(4,458,262) 

- 

(56,832) 

- 

(4,515,094) 

- 

(4,515,094) 

- 

- 

22,927 

9,136,368 

- 

- 

3,864,300 

13,023,595 

- 

(5,634,119) 

- 

- 

- 

(5,634,119) 

2,874,382 

738,146 

3,612,528 

1,422,000 

(1,421,278) 

722 

- 

(41,462) 

- 

(40,740) 

- 

(40,740) 

- 

- 

12,529 

3,866,900 

- 

- 

(1,471,193) 

2,408,236 

- 

(3,286,570) 

- 

- 

- 

(3,286,570) 

(919,074) 

1,657,220 

738,146

NOTES TO THE FINANCIAL STATEMENTS 


1. GENERAL INFORMATION 

The Company is a public limited liability company, incorporated and domiciled in Malaysia and 

listed on the Main Market of Bursa Malaysia Securities Berhad. 

The Company is principally involved in investment holdings and provision of management services to 

the subsidiary companies. 

The principal activities of the subsidiary companies are disclosed in Note 15. 

There have been no significant changes in the nature of the principal activities of the Company and 

its subsidiary companies during the financial year. 

The registered office of the Company is located at Suite 1301, 13th Floor, City Plaza, Jalan Tebrau, 

80300 Johor Bahru, Johor. 

The principal place of business of the Company is located at Suite 15.3A, Level 15, Menara Pelangi, 

No. 2, Jalan Kuning, Taman Pelangi, 80400 Johor Bahru, Johor. 

The financial statements of the Group and of the Company were authorised by the Board of 

Directors for issuance in accordance with a resolution of the directors on 25 February 2013. 

2. BASIS OF PREPARATION OF THE FINANCIAL STATEMENTS 

The financial statements of the Group and of the Company have been prepared in accordance 

with Financial Reporting Standards (“FRS”) and with the provisions of the Companies Act, 1965 in 

Malaysia. 

2.1 Adoption of new and revised FRS 

In the current financial year, the Group and the Company have adopted all the new and revised 

FRSs and IC Interpretations (“IC Int.”) issued by the Malaysian Accounting Standards Board (“MASB”) 

that are effective for annual periods beginning on or after 1 January 2012 as follows: 

FRS 1 First Time Adoption of Financial Reporting Standards (Amendments relating to Severe 

Hyperinflation and Removal of Fixed Dates for First Time Adopters) 

FRS 7 Financial Instruments: Disclosures (Amendments relating to Disclosures - Transfers of Financial 

Assets) 

FRS 112 Income Tax (Amendments relating to Deferred Tax: Recovery of Underlying Assets) 

FRS 124 Related Party Disclosures (Revised) 

Improvements to FRSs 2011 

IC Int. 14 FRS 119 – The Limit on a Defined Benefit Asset, Minimum Funding Requirements and Their 

Interaction (Amendments relating to prepayments of a minimum funding requirement) 

IC Int. 19 Extinguishing Financial Liabilities with Equity Instruments 

The adoption of the above Standards and IC Int. did not have any effect on the financial 

performance or position of the Group and of the Company. 

2.2 Standards and Interpretations issued but not yet effective 

At the date of authorisation for issue of these financial statements, the Group and the 

Company have not adopted the following Standards and IC Int. that have been issued but not 

yet effective: 

FRS 1 First Time Adoption of Financial Reporting Standards (Amendments relating to Government 

Loans) 1 

FRS 1 First Time Adoption of Financial Reporting Standards (Amendments relating to Repeat 

Application of FRS1 and Borrowing Costs) 1 

FRS 7 Financial Instruments: Disclosures (IFRS 9 issued by IASB in November 2009 - Amendments 

relating to Mandatory Effective Date of FRS 9 and Transition Disclosures) 2 

FRS 7 Financial Instruments: Disclosures (Amendments relating to Disclosures - Offsetting Financial 

Assets and Financial Liabilities) 1 

FRS 9 Financial Instruments (IFRS 9 issued by IASB in November 2009) 3 

FRS 9 Financial Instruments (IFRS 9 issued by IASB in November 2009 - Amendments relating to 

Mandatory Effective date of FRS 9 and Transition Disclosures) 2 

FRS 9 Financial Instruments (IFRS 9 issued by IASB in October 2010) 3 

FRS 9 Financial Instruments (IFRS 9 issued by IASB in October 2010 - Amendments relating to 

Mandatory Effective date of FRS 9 and Transition Disclosures) 2 

FRS 10 Consolidated Financial Statements 1 

FRS 11 Joint Arrangements 1 

FRS 12 Disclosures of Interests in Other Entities 1 

01 33 


34 



FOR THE YEAR ENDED 31 DECEMBER 2012 (continue) 

FRS 13 Fair Value Measurement 1 

FRS 101 Presentation of Financial Statements (Amendments relating to Presentation of Items of Other 

Comprehensive Income) 4 

FRS 101 Presentation of Financial Statements (Amendments relating to Clarification of the Requirements 

for Comparative Information) 1 

FRS 116 Property, Plant and Equipment (Amendments relating to Classification of Servicing Equipment) 1 

FRS 119 Employee Benefits (2011) 1 

FRS 127 Separate Financial Statements (2011) 1 

FRS 128 Investment in Associates and Joint Ventures (2011) 1 

FRS 132 Financial Instruments: Presentation (Amendments relating to Tax Effect of Equity Distribution) 1 

FRS 132 Financial Instruments: Presentation (Amendments relating to Offsetting Financial Assets and 

Financial Liabilities) 5 

FRS 134 Interim Financial Reporting (Amendments relating to Interim Reporting to Segment Assets) 1 

IC Int. 2 Members’ Shares in Co-operative Entities and Similar Instruments (Amendments relating to Tax 

Effect of Equity Distribution) 1 

IC Int. 20 Stripping Costs in the Production Phase of a Surface Mine 1 

1 Effective for annual periods beginning on or after 1 January 2013 

2 Effective for annual periods beginning on or after 1 March 2012 


4 Effective for annual periods beginning on or after 1 July 2012 


The directors anticipate that the abovementioned Standards and IC Int. will be adopted in the annual 

financial statements of the Group and of the Company when they become effective and that the 

adoption of these Standards and IC Int. will have no material impact on the amounts reported in the 

financial statements of the Group and of the Company in the period of initial application except as 

discussed below: 

The amendments to FRS 7 which are effective for annual periods beginning on or after 1 January 2013 

introduce new disclosure requirements relating to rights of offset and related arrangements for financial 

instruments under an enforceable master netting agreements or similar arrangements. To date, the 

Group and the Company have not entered into any such agreements or similar arrangements. However, 

if the Group and the Company do enter into such arrangements in the future, the Group and the 

Company will need to comply with these disclosure requirements accordingly. 

FRS 9 (IFRS 9 issued by IASB in November 2009) introduces new requirements for the classification and 

measurement of financial assets. FRS 9 (IFRS 9 issued by IASB in October 2010) includes the requirements 

for the classification and measurement of financial liabilities and for derecognition. 

The amendments to FRS 9 (IFRS 9 issued by IASB in November 2009 and October 2010 respectively) (“FRS 

9”) relating to “Mandatory Effective Date of FRS 9 and Transition Disclosures” which became 

immediately effective on the issuance date of 1 March 2012 amended the mandatory effective date of 

FRS 9 to annual periods beginning on or after 1 January 2015 instead of on or after 1 January 2013, with 

earlier application still permitted as well as modified the relief from restating prior periods. FRS 7 which 

was also amended in tandem with the issuance of the aforementioned amendments introduces new 

disclosure requirements that are either permitted or required on the basis of the entity’s date of adoption 

and whether the entity chooses to restate prior periods. 

Key requirements of FRS 9 are described as follows: 

(a) FRS 9 requires all recognised financial assets that are within the scope of FRS 139 Financial Instruments: 

Recognition and Measurement to be subsequently measured at amortised cost or fair value. 

Specifically, debt investments that are held within a business model whose objective is to collect the 

contractual cash flows, and that have contractual cash flows that are solely payments of principal 

and interest on the principal outstanding are generally measured at amortised cost at the end of 

subsequent accounting periods. All other debt investments and equity investments are measured at 

their fair values at the end of subsequent accounting periods. 

(b) The most significant effect of FRS 9 regarding the classification and measurement of financial 

liabilities relates to the accounting for changes in the fair value of a financial liability (designated as 

at fair value through profit or loss) attributable to changes in the credit risk of that liability. Specifically, 

under FRS 9, for financial liabilities that are designated as at fair value through profit or loss, the 

amount of change in the fair value of the financial liability that is attributable to changes in the 

credit risk of that liability is presented in other comprehensive income, unless the recognition of the 

effects of changes in the liability’s credit risk in other comprehensive income would create or enlarge 

an accounting mismatch in profit or loss. Changes in fair value attributable to a financial liability’s 

credit risk are not subsequently reclassified to profit or loss. Previously, under FRS 139, the entire 

amount of the change in the fair value of the financial liability designated as at fair value through 

profit or loss was presented in profit or loss. 

The directors anticipate that FRS 9 will be adopted in the Group’s and the Company’s financial 

statements for the annual period beginning 1 January 2015 and that the application of FRS 9 may 

have an impact on the future classification and measurement of financial asset of the Group and of 

the Company.



In November 2011, a package of five Standards on consolidation, joint arrangements, associates 

and disclosures was issued, including FRS 10, FRS 11, FRS 12, FRS 127 (as revised in 2011) and FRS 128 

(as revised in 2011). 

Key requirements of these five Standards are described below: 

FRS 10 replaces the parts of FRS 127 Consolidated and Separate Financial Statements (revised in 

2010) that deal with consolidated financial statements. IC Int. 112 Consolidation – Special Purpose 

Entities has been withdrawn upon the issuance of FRS 10. Under FRS 10, there is only one basis for 

consolidation, that is control. In addition, FRS 10 includes a new definition of control that contains 

three elements: 

(a) power over an investee; 

(b) exposure, or rights, to variable returns from its involvement with the investee; and 

(c) the ability to use its power over the investee to affect the amount of the investor’s returns. 

Extensive guidance has been added in MFRS 10 to deal with complex scenarios. 

FRS 11 replaces FRS 131 Interests in Joint Ventures. FRS 11 deals with how a joint arrangement of which 

two or more parties have joint control should be classified. IC Int. 113 Jointly Controlled Entities – Non-monetary 

Contributions by Venturers has been withdrawn upon the issuance of FRS 11. Under FRS 11, joint 

arrangements are classified as joint operations or joint ventures, depending on the rights and obligations 

of the parties to the arrangements. In contrast, under FRS 131, there are three types of joint 

arrangements: jointly controlled entities, jointly controlled assets and jointly controlled operations. 

In addition, joint ventures under FRS 11 are required to be accounted for using the equity method of 

accounting, whereas jointly controlled entities under FRS 131 can be accounted for using the equity 

method of accounting or proportionate accounting. 

FRS 12 is a disclosure standard and is applicable to entities that have interests in subsidiaries, joint 

arrangements, associates and/ or unconsolidated structured entities. In general, the disclosure 

requirements in FRS 12 are more extensive than those in the current standards. 

In July 2012, amendments were made to FRS 10, FRS 11 and FRS 12 Consolidated Financial Statements, 

Joint Arrangements and Disclosure of Interests in Other Entities: Transition Guidance. 

The amendment clarifies that the “date of initial application” in FRS 10 means “the beginning of the 

annual reporting period in which FRS 10 is applied for the first time”. Consequently, an entity is not 

required to adjust its previous accounting if: 

(a) the consolidation conclusion reached upon the application of FRS 10 is the same as previous 

accounting; or 

(b) the entity had disposed of its interests in investees during a comparative period. 

If an entity has to consolidate an investee that was not previously consolidated when applying FRS 10 or 

concludes that it will no longer consolidate an investee that was previously consolidated, the 

amendments limit the requirement to present adjusted comparative information to the period 

immediately preceding the date of initial application. However, the entity is not prohibited from 

presenting adjusted comparative information for earlier periods. 

A similar relief is also provided in FRS 11 and FRS 12. Additionally, entities would no longer be required to 

provide disclosures for unconsolidated structured entities in periods prior to the first annual period that 

FRS 12 is applied. 

If, upon applying FRS 10, an entity concludes that it shall consolidate an investee that was not previously 

consolidated and that control was obtained before the effective date of FRS 3 Business Combinations 

and FRS 127 Consolidated and Separate Financial Statements issued by the Malaysian Accounting 

Standards Board in January 2010, the amendments provide the choice to Transitional Entities to apply 

either the earlier (i.e. as issued in February 2006) or the revised versions of FRS 3 and FRS 127 (as issued in 

January 2010). 

The directors anticipate that these five standards will be adopted in the Group’s consolidated financial 

statements for the annual period beginning 1 January 2013. The application of these five standards will 

have no material impact on the financial statements of the Group. 

The amendments to FRS 101 relating to Presentation of Items of Other Comprehensive Income retain the 

option to present profit or loss and other comprehensive income in either a single statement or in two 

separate but consecutive statements. However, the amendments to FRS 101 require additional 

disclosures to be made in the other comprehensive income section such that items of other 

comprehensive income are grouped into two categories: 

(a) items that will not be reclassified subsequently to profit or loss; and 

(b) items that will be reclassified subsequently to profit or loss when specific conditions are met. 

01 35 


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Income tax on items of other comprehensive income is required to be allocated on the same basis. 

The amendments to FRS 101 are effective for annual periods beginning on or after 1 July 2012. The 

presentation of items of other comprehensive income will be modified accordingly when the 

amendments are applied in the future accounting periods. 

The amendments to FRS 101 relating to “Clarification of the requirements for comparative information” 

clarifies that an entity is required to present a third statement of financial position only if a retrospective 

application, retrospective restatement or reclassification has a material effect on the information in the 

statement of financial position at the beginning of the preceding period. 

Nevertheless, an entity may present comparative information in addition to the minimum comparative 

financial statements as long as that information is prepared in accordance with FRSs. In addition, the 

amendments clarify that other than the disclosure of certain specified information, related notes are not 

required to accompany the opening statement of financial position as at the beginning of the 

preceding period. The amendments will be applied accordingly when it becomes effective for 

application. 

2.3 Malaysian Financial Reporting Standards 

On 19 November 2011, the MASB issued a new MASB approved accounting framework, the Malaysian 

Financial Reporting Standards Framework (“MFRS Framework”) in conjuction with its planned 

convergence of FRSs with International Financial Reporting Standards (“IFRS”) as issued by the 

International Accounting Standards Board (“IASB”) on 1 January 2012. 

The MFRS Framework is a fully IFRS-compliant framework, equivalent to IFRSs which is mandatory for 

adoption by all Entities Other than Private Entities for annual periods beginning on or after 1 January 2012, 

with the exception for Transitioning Entities, which are subject to the application of MFRS 141 Agriculture 

and/or IC Interpretation 15 Agreements for the Construction of Real Estate are given an option to defer 

adoption of the MFRS Framework for an additional one year. Transitioning Entities also includes those 

entities that consolidate, equity account or proportionately consolidate an entity that has chosen to 

continue to apply the FRS Framework for annual periods beginning on or after 1 January 2012. 

On 30 June 2012, the MASB has decided to allow Transitioning Entities to defer the adoption of MFRS 

Framework for another year. Consequently, adoption of the MFRS Framework by the Transitioning Entities 

will be mandatory for annual periods beginning on or after 1 January 2014. 

The Group and the Company, being the Transitioning Entities, will be required to prepare financial 

statements using MFRS Framework in its first MFRS financial statements for the year ending 31 December 

2014. In presenting its first MFRS financial statements, the Group and the Company will be required to 

restate the comparative financial statements to amounts reflecting the application of MFRS Framework. 

The majority of the adjustment required on transition will be made, retrospectively, against opening 

retained profits. Further, an explicit and unreserved statement of compliance with IFRSs will be made in 

the financial statements. 

The Group is currently assessing the impact of the financial effects of the differences between FRS and 

accounting standards under the MFRS Framework. 

3. 

SIGNIFICANT ACCOUNTING POLICIES 

Basis of Accounting 

The financial statements of the Group and of the Company have been prepared under the historical 

cost convention, unless otherwise indicated in the accounting policies stated below. 

Basis of Consolidation 

The consolidated financial statements incorporate the financial statements of the Company and entities 

(its subsidiary companies) controlled by the Group as of the reporting date. Control is achieved where 

the Company has the power to govern the financial and operating policies of an entity so as to obtain 

benefits from its activities. 

The results of the subsidiary companies are consolidated from the date of acquisition, being the date on 

which the Group obtains control, and continue to be consolidated until the date that such control 

ceases. The financial statements of the Company and its subsidiary companies used in the preparation 

of the consolidated financial statements shall be prepared as of the same reporting date. Where 

necessary, adjustments are made to the financial statements of subsidiary companies to bring their 

accounting policies into line with those used by other members of the Group. All inter-company 

transactions, balances, income and expenses are eliminated in full on consolidation. 

Investments in Subsidiary Companies 

Investment in subsidiary companies which are eliminated on consolidation, are stated at cost less 

impairment losses, if any, in the Company’s separate financial statements.



Business Combinations 

The acquisition of subsidiary companies is accounted for using the acquisition method. The cost of the 

business combination is measured as the aggregate of the fair values, at the date of exchange, of 

assets given, liabilities incurred or assumed, and equity instruments issued by the Group in exchange for 

control of the acquiree, plus any costs directly attributable to the business combination. The acquiree’s 

identifiable assets, liabilities and contingent liabilities that meet the conditions for recognition under FRS 3 

Business Combinations are recognised at their fair values at the acquisition date, except for non-current 

assets (or disposal groups) that are classified as held for sale in accordance with FRS 5 Non-Current 

Assets Held for Sale and Discontinued Operations, which are recognised and measured at fair value less 

costs to sell. 

Functional and Presentation Currency 

The financial statements of the Company and the Group are presented in Ringgit Malaysia (“RM”), 

which is the Company’s functional currency and presentation currency. 

Revenue Recognition 

Revenue is measured at the fair value of the consideration received or receivable. Revenue is reduced 

for rebates and other similar allowances. 

The revenue recognition policies of the Group and of the Company are as follows: 

Property development projects - upon signing of individual sale and purchase agreements, based on 

the stage of completion method as determined by the proportion of the property development projects 

sold attributable to the percentage of development work performed during the year. 

Sales of vacant land and completed development units - upon transfer of significant risks and rewards to 

the buyers. 

Construction contracts - refer to policy on construction contracts below. 

Rental income from investment properties - accrued on a straight-line basis over the term of the relevant 

lease. 

Project management fee, management fee and project incentive income - when the services are 

rendered. 

Sales of oil palm - upon delivery of products and customers’ acceptance, net of discounts and returns 

and when significant risks and rewards of ownership have transferred to the buyer. 

Dividend income - when the shareholder’s right to receive payment is established. 

Interest income - accrued on a time basis, by reference to the principal outstanding and at the effective 

interest rate applicable, which is the rate that exactly discounts estimated future cash receipts through 

the expected life of the financial asset to that asset’s net carrying amount on initial recognition. 

Leasing 

Lease in terms of which the Group and the Company assume substantially all the risks and rewards of 

ownership are classified as finance lease. On initial recognition, the leased asset is measured at an 

amount equal to the lower of its fair value and present value of minimum lease payments. Subsequent 

to the initial recognition, the asset is accounted for in accordance with the accounting policy 

applicable to that asset. 

Other leases are operating leases and are not recognised in the Group and the Company’s statements 

of financial position. Operating lease income and payments are recognised as revenue and expense in 

the statements of comprehensive income on a straight-line basis over the relevant lease terms. 

Employee Benefits 

(i) Short-term Benefits 

Wages, salaries, bonuses and social security contributions are recognised as an expense in the 

year in which the associated services are rendered by employees. 

Short-term accumulating compensated absences such as paid annual leave are recognised 

when services are rendered by employees that increase their entitlement to future compensated 

absences and short-term non-accumulating compensated absences such as sick leave are 

recognised when the absences occur. 

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(ii) Defined Contribution Plans 

The Group and the Company are required by law to make monthly contributions to the Employees' 

Provident Fund (“EPF”), a statutory defined contribution plan for all their eligible employees based 

on certain prescribed rates of the employees' salaries. The Group's and the Company's contributions 

to EPF are disclosed separately. The employees' contributions to EPF are included in salaries and 

wages. Once the contributions have been paid, there are no further payment obligations. 

Taxation 

Income tax expense represents the sum of the tax currently payable and deferred tax. 

Current tax 

The tax currently payable is based on taxable profit for the year. Taxable profit differs from profit as 

reported in the statements of comprehensive income because it excludes items of income or 

expense that are taxable or deductible in other years and it further excludes items that are never 

taxable or deductible. The Group’s and the Company’s liability for current tax is calculated using tax 

rates that have been enacted or substantively enacted by the end of reporting period. 

Deferred tax 

Deferred tax is recognised on differences between the carrying amounts of assets and liabilities in the 

financial statements and the corresponding tax bases used in the computation of taxable profit. 

Deferred tax liabilities are generally recognised for all taxable temporary differences, and deferred tax 

assets are generally recognised for all deductible temporary differences, unused tax losses and unused 

tax credits to the extent that it is probable that taxable profits will be available against which deductible 

temporary differences, unused tax losses and unused tax credits can be utilised. Such assets and 

liabilities are not recognised if the temporary difference arises from goodwill or from the initial recognition 

(other than in a business combination) of other assets and liabilities in a transaction that affects neither 

the taxable profit nor the accounting profit. 

The carrying amount of deferred tax assets is reviewed at end of each reporting date and reduced to 

the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part 

of the asset to be recovered. 

Deferred tax assets and liabilities are measured at the tax rates that are expected to apply in the period 

in which the liability is settled or the asset realised, based on tax rates (and tax laws) that have been 

enacted or substantively enacted by the end of each reporting date. The measurement of deferred tax 

liabilities and assets reflects the tax consequences which the Group and the Company expect, at the 

end of each reporting date, to recover or settle the carrying amount of its assets and liabilities. 

Deferred tax assets and liabilities are offset when there is a legally enforceable right to set off current tax 

assets against current tax liabilities and when they relate to income taxes levied by the same taxation 

authority and the Group and the Company intend to settle its current tax assets and liabilities on a net 

basis. 

Current and deferred tax for the year 

Current and deferred tax are recognised as an expense or income in profit or loss, except when they 

relate to items credited or debited outside profit or loss (either in other comprehensive income or directly 

in equity), in which case the tax is also recognised outside profit or loss (either in other comprehensive 

income or directly in equity), or where they arise from the initial accounting for a business combination. 

In the case of a business combination, the tax effect is included in the accounting for the business 

combination. 

Property, Plant and Equipment 

Property, plant and equipment are stated at cost less accumulated depreciation and accumulated 

impairment losses, if any. 

Gains or losses arising from the disposal of an asset are determined as the difference between the 

estimated net disposal proceeds and the carrying amount of the asset, and are recognised in profit or 

loss. 

Property, plant and equipment are depreciated on a straight-line method to their residual values at 

rates based on the estimated useful lives of the various assets. 

The annual rates of depreciation are as follows: 

Motor vehicles 20% 

Office equipment 10% to 25% 

Furniture and fittings 10% to 20% 

Renovations 10%



The residual values, useful lives and depreciation method are reviewed at each financial year end to 

ensure that the amount, method and period of depreciation are consistent with previous estimates and 

the expected pattern of consumption of the future economic benefits embodied in the items of 

property, plant and equipment. 

Assets held under finance leases are depreciated over their expected useful lives on the same basis as 

owned assets. 

Investment Properties 

Investment properties are properties which are held for long term rental yields or for capital appreciation 

or for both (including property under construction). These properties are long term investment and are 

measured initially at cost, including transaction costs. Subsequent to initial recognition, investment 

properties are stated at fair value. Fair value is based on active market prices, adjusted, if necessary, for 

any difference in nature, location or condition of the specific asset. If this information is not available, 

the Group used alternative valuation method such as recent price on less active markets. 

Gains or losses arising from changes in the fair values of investment properties are recognised in profit or 

loss in the year in which they arise. 

Investment properties are derecognised when either they have been disposed off or when the 

investment properties are permanently withdrawn from use and no future economic benefit is expected 

from its disposal. Any gains or losses on the retirement or disposal of an investment property are 

recognised in profit or loss in the year in which they arise. 

The investment property under construction is measured at cost until the earlier of the date construction 

is completed when the fair value can be determined reliably. 

Property Development Activities 

Land held for future development represents land where no development activities have been carried 

out or where development activities are not expected to be completed within the normal operating 

cycle. Such land is classified within non-current assets. The land held for future development is stated at 

cost less impairment losses, if any. 

Land held for future development will be reclassified to property development expenditure when 

significant development work has been undertaken and is expected to be completed within the normal 

operating cycle. 

Property development expenditure consists of the cost of land, direct building costs and related 

development expenditure incurred less cost recognised in profit or loss and allowances for foreseeable 

loss (if any). 

Accrued progress billings represent the excess of property development revenue recognised in profit or 

loss over the billings to purchasers while advance progress billings represent the excess of billings to 

purchasers over property development revenue recognised in profit or loss. 

Allowance for foreseeable loss (if any) is recognised as an expense immediately based on losses 

estimated to arise upon the completion of the property development projects which are already in 

progress. 

Inventories of unsold completed development units are stated at the lower of cost and net realisable 

value. Cost of inventory is determined on the specific identification method and includes costs of land, 

construction and appropriate development overheads. 

Construction Contracts 

Where the outcome of a construction contract can be estimated reliably, revenue and costs are 

recognised by reference to the stage of completion of the contract activity at the end of each 

reporting date, measured based on the proportion of contract costs incurred for work performed to 

date relative to the estimated total contract costs, except where this would not be representative of the 

stage of completion. Variations in contract work, claims and incentive payments are included to the 

extent that they have been agreed with the customer. 

Where the outcome of a construction contract cannot be estimated reliably, contract revenue is 

recognised to the extent of contract costs incurred that it is probable will be recoverable. Contract costs 

are recognised as expenses in the period in which they are incurred. 

When it is probable that total contract costs will exceed total contract revenue, the expected loss is 

recognised as an expense immediately as allowance for foreseeable loss. 

When costs incurred on construction contracts plus recognised profits (less recognised losses) exceeds 

billings to contract customers, the balance is shown as amount due from contract customers. When 

billings to contract customers exceed costs incurred plus recognised profits (less recognised losses), the 

balance is shown as amount due to contract customers. 

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Impairment of Tangible Assets 

At the end of each reporting date, the Group and the Company review the carrying amounts of 

tangible assets to determine whether there is any indication that those assets have suffered an 

impairment loss. If such indication exists, the recoverable amount of asset is estimated in order to 

determine the extent of impairment loss (if any). 

Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, 

the estimated future cash flows are discounted to their present value using a pre-tax discount rate that 

reflects current market assessments of the time value of money and the risks specific to the asset for 

which the estimates of future cash flows have not been adjusted. 

If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying 

amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. 

An impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a 

revalued amount, in which case the impairment loss is treated as a revaluation decrease. 

Where an impairment loss subsequently reverses, the carrying amount of the asset is increased to the 

revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed 

the carrying amount that would have been determined had no impairment loss been recognised for the 

asset in prior years. A reversal of an impairment loss is recognised immediately in profit or loss, unless the 

relevant asset is carried at a revalued amount, in which case the reversal of the impairment loss is 

treated as a revaluation increase. 

Financial Instruments 

Financial instruments are recognised in the statements of financial position when, and only when, the 

Group and the Company become a party to the contractual provisions of the financial instruments. 

Where the purchase or sale of a financial asset is under a contract whose terms require delivery of the 

financial asset within the timeframe established by the market concerned, such financial assets are 

recognised and derecognised on trade date. 

Financial instruments are initially measured at fair value, plus transaction costs, except for those financial 

assets classified as at fair value through profit or loss, which are initially measured at fair value. 

Financial Assets 

Financial assets are classified into the following specified categories: financial assets “at fair value 

through profit or loss” (“FVTPL”), “held-to-maturity” (“HTM”) investments, “available-for-sale” (“AFS”) 

financial assets and “loans and receivables” (“L&R”). The classification depends on the nature and 

purpose of the financial assets and is determined at the time of initial recognition. 

Effective interest method 

The effective interest method is a method of calculating the amortised cost of a financial asset and of 

allocating interest income over the relevant period. The effective interest rate is the rate that exactly 

discounts estimated future cash receipts (including all fees on points paid or received that form an 

integral part of the effective interest rate, transaction costs and other premiums or discounts) through 

the expected life of the financial asset, or (where appropriate) a shorter period, to the net carrying 

amount on initial recognition. 

Income is recognised on an effective interest basis for debt instruments other than those financial assets 

classified as at FVTPL. 

Financial assets at fair value through profit or loss (“FAFVTPL”) 

Financial assets are classified as at FAFVTPL where the financial asset is either held for trading or it is 

designated as such upon initial recognition. 

A financial asset is classified as held for trading if: 

• it has been acquired principally for the purpose of selling in the near future; or 

• it is a part of a portfolio of identified financial instruments that the Group manages together and 

has a recent actual pattern of short-term profit-taking; or 

• it is a derivative that is not designated and effective as a hedging instrument. 

A financial asset other than a financial asset held for trading may be designated as at FVTPL upon 

initial recognition if: 

• such designation eliminates or significantly reduces a measurement or recognition inconsistency 

that would otherwise arise; or 

• the financial asset forms part of a group of financial assets or financial liabilities or both, which is 

managed and its performance is evaluated on a fair value basis, in accordance with the Group's 

documented risk management or investment strategy, and information about the grouping is provided 

internally on that basis; or



• it forms part of a contract containing one or more embedded derivatives, and FRS 139 Financial 

Instruments: Recognition and Measurement permits the entire combined contract (asset or liability) to 

be designated as at FVTPL. 

Subsequent to initial recognition, FAFVTPL are measured at fair value. Any gains or losses arising from 

changes in fair value are recognised in profit or loss. Net gains or net losses on FAFVTPL do not include 

interest and dividend income. Interest and dividend income are recognised separately in profit or loss 

as part of other income or other losses. 

The Group and the Company have not designated any financial assets as at FVTPL. 

HTM investments 

HTM investments are non-derivative financial assets with fixed or determinable payments and fixed 

maturity dates where the Group has a positive intent and ability to hold to maturity. Subsequent to 

initial recognition, HTM investments are measured at amortised cost using the effective interest method 

less impairment. Gains or losses are recognised in profit or loss when the HTM investments are 

derecognised or impaired, and through the amortisation process. 

The Group and the Company have not designated any HTM investments. 

AFS financial assets 

AFS financial assets are non-derivatives that are either designated as available-for-sale or are not 

classified as loans and receivables, held-to-maturity investments or financial assets at FVTPL. All AFS 

financial assets are measured at fair value at the end of the reporting period. Gains and losses arising 

from changes in fair value are recognised in other comprehensive income and accumulated in the 

investments revaluation reserve, with the exception of impairment losses, interest calculated using the 

effective interest method, which are recognised in profit or loss. Where the investment is disposed of or 

is determined to be impaired, the cumulative gain or loss previously accumulated in the investments 

revaluation reserve is reclassified to profit or loss. 

AFS equity investments that do not have a quoted market price in an active market and whose fair 

value cannot be reliably measured and derivatives that are linked to and must be settled by delivery of 

such unquoted equity investments are measured at cost less any identified impairment losses at the 

end of the reporting period. 

The Group and the Company have not designated any AFS financial assets. 

L&R 

L&R are non-derivative financial assets with fixed or determinable payments that are not quoted in an 

active market. L&R are measured at amortised cost using the effective interest method, less any 

impairment. Interest income is recognised by applying the effective interest rate, except for short-term 

receivables when the recognition of interest would be immaterial. 

Derecognition of financial assets 

The Group derecognises a financial asset only when the contractual rights to the cash flows from the 

asset expire, or when it transfers substantially all risks and rewards of the financial asset to another entity. 

If the Group neither transfers nor retains substantially all the risks and rewards of ownership and 

continues to control the transferred asset, the Group recognises its retained interest in the transferred 

asset to the extent of its continuing involvement. If the Group retains substantially all the risks and 

rewards of ownership of a transferred financial asset, the Group continues to recognise the financial 

asset and also recognises a collateralised borrowing for the proceeds received. 

On derecognition of a financial asset in its entirety, the difference between the carrying amount and the 

sum of the consideration received and any cumulative gain or loss that had been recognised in the 

other comprehensive income is recognised in profit or loss. 

Impairment of financial assets 

Financial assets, other than those at FVTPL, are assessed for indicators of impairment at the end of each 

reporting period. Financial assets are considered 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 affected. 

Trade and other receivables and other financial assets carried at amortised cost 

Trade receivables and other receivables and other financial assets are assessed not to be impaired 

individually are, in addition, assessed for impairment on a collective basis. Objective evidence of 

impairment for a portfolio of receivables could include the Group’s past experience of collecting 

payments, an increase in the number of delayed payments in the portfolio past the average credit 

period, as well as observable changes in national or local economic conditions that correlate with 

default on receivables. 

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If any such evidence exists, the amount of impairment loss is measured as the difference between the 

assets’ carrying amount and the present value of estimated future cash flows discounted at the financial 

asset’s original effective interest rate. The impairment loss is recognised in profit or loss. 

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 recognised in profit or loss. 

Financial Liabilities and Equity Instruments 

Debts or equity instruments are classified either as financial liabilities or equity in accordance to the 

substance of the contractual arrangements. 

Equity instruments 

An equity instrument is any contract that evidences a residual interest in the assets of an entity after 

deducting all of its liabilities. Equity instruments issued by the Group and the Company are recognised at 

the proceeds received, net of direct issue costs. 

Financial liabilities 

Financial liabilities, within the scope of FRS 139, are recognised in the statement of financial position 

when, and only when, the Group and the Company become a party to the contractual provisions of 

the financial instrument. Financial liabilities are classified as either financial liabilities at FVTPL or other 

financial liabilities. 

Financial liabilities at fair value through profit or loss (“FLFVTPL”) 

Financial liabilities are classified as at FVTPL where the financial liability is either held for trading or it is 

designated as at FVTPL. 

A financial liability is classified as held for trading if: 

• it has been incurred principally for the purpose of repurchasing in the near future; or 

• it is a part of an identified portfolio of financial instruments that the Group manages together and 

has a recent actual pattern of short-term profit-taking; or 

• it is a derivative that is not designated and effective as a hedging instrument 

A financial liability other than a financial liability held for trading may be designated as at FVTPL upon 

initial recognition if: 

• such designation eliminates or significantly reduces a measurement or recognition inconsistency 

that would otherwise arise; or 

• the financial liability forms part of a group of financial assets or financial liabilities or both, which is 

managed and its performance is evaluated on a fair value basis, in accordance with the Group's 

documented risk management or investment strategy, and information about the grouping is 

provided internally on that basis; or 

• it forms part of a contract containing one or more embedded derivatives, and FRS 139 Financial 

Instruments: Recognition and Measurement permits the entire combined contract (asset or liability) to 

be designated as at FVTPL. 

The Group and the Company have not designated any financial liabilities as at FVTPL. 

Other financial liabilities 

Other financial liabilities, including borrowings, are initially measured at fair value, net of transaction 

costs. 

Other financial liabilities are subsequently measured at amortised cost using the effective interest 

method, with interest expense recognised on an effective yield basis. 

The effective interest method is a method of calculating the amortised cost of a financial liability 

and of allocating interest expense over the relevant period. The effective interest rate is the rate that 

exactly discounts estimated future cash payments through the expected life of the financial liability, 

or (where appropriate) a shorter period, to the net carrying amount on initial recognition. 

Financial guarantee contracts 

A financial guarantee contract is a contract that requires the issuer to make specified payment to 

reimburse the holder for a loss it incurs because a specified debtors fails to make payment when 

due.



Financial guarantee contract liabilities are measured initially at their fair values, net of transaction 

cost. Subsequent to initial recognition, financial guarantee contracts are recognised as income in 

profit or loss over the period of the guarantee. If the debtor fails to make payment relating to the 

financial guarantee contract when it is due and the Group, as the issuer, is required to reimburse the 

holder for the associated loss, the liability is measured at the higher of the best estimate of 

expenditure required to settle the present obligation at the reporting date and the amount initially 

recognised less cumulative amortisation. 

Derecognition of financial liability 

The Group derecognises financial liabilities when, and only when, the Group’s obligations are 

discharged, cancelled or they expire. 

Borrowing Costs 

Borrowing costs directly attributable to the acquisition or construction of assets which require a 

substantial period of time to get them ready for their intended use are capitalised and included as 

part of the related assets. Capitalisation of borrowing costs will cease when the assets are ready for 

their intended use. The Group capitalises borrowing costs for all qualifying assets. 

All other borrowing costs are recognised in profit or loss in the period they are incurred. 

Statements of Cash Flows 

The Group and the Company adopt the direct method in the preparation of the statements of cash 

flows. 

Cash equivalents comprise cash and bank balances, short term, highly liquid investments that are 

readily convertible to a known amount of cash with insignificant risks of changes in value against 

which bank overdrafts, if any, is deducted. 

Critical Accounting Judgements and Key Sources of Estimation Uncertainty 

In the application of the Group’s accounting policies, which are described in Note 3, the 

management is required to make judgements, estimates and assumptions about the carrying 

amounts of assets and liabilities that are not readily apparent from other sources. The estimates and 

associated assumptions are based on historical experience and other factors that are considered to 

be relevant. Actual results may differ from these estimates. 

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to 

accounting estimates are recognised in the period in which the estimate is revised and in the future 

periods if the revision affects both current and future periods. 

(a) Critical judgements in applying the Group’s accounting policies 

In the process of applying the Group’s accounting policies, the directors are of the opinion that there 

are no instances of application of judgement which are expected to have a significant effect on the 

amounts recognised in the financial statements. 

(b) Key sources of estimation uncertainty 

The following are the key assumptions concerning the future, and other key sources of estimation 

uncertainty at the end of the reporting period, that have a significant risk of causing a material 

adjustment to the carrying amounts of assets and liabilities within the next financial year. 

i. Fair value of investment properties 

The fair value of investment properties, which is determined by the directors, is arrived at by 

reference to market evidence of transaction prices for similar properties which could be 

exchanged on the date of valuation in an arm’s length transaction wherein the parties had each 

acted competently, prudent and without compulsion or by relying on the work of accredited 

independent firm of valuers using open market value based on active market prices, adjusted, if 

necessary, for any difference in the nature, location or condition of the specific asset. 

ii. Property development activities and construction contracts 

The Group recognises revenue from property development activities/ construction contract by 

using the stage of percentage of completion method. The stage of completion is determined by 

the proportion that property development cost/construction cost incurred for work performed to 

date bear to the estimated total property development costs/construction costs. Property 

development projects/construction contract and expenses estimates are reviewed and revised 

periodically as work progresses and as variation orders are approved. 

Significant judgement is required in determining the stage of completion, the extent of the 

property development costs/construction costs incurred, the estimated total property 

development/construction revenue and costs as well as the recoverability of the project/contract 

undertaken. In making the judgement, the Group evaluates based on past experience and by 

relying on the work of specialists. 

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4. REVENUE 


2012 2011 2012 2011 

RM RM RM RM 

Property development 64,872,491 56,097,595 - - 

Sales of completed development units 9,556,637 22,413,036 - - 

Sales of land held for property development 20,619,503 7,990,488 - - 

Construction contract revenue - 295,520 - - 

Rental income 7,563,881 7,326,426 - - 

Sales of oil palm fruits 1,540,450 1,980,057 - - 

Dividend income from subsidiary companies - - 10,131,824 5,139,200 

Management fee income from subsidiary companies - - 1,418,400 1,422,000 

5. OPERATING COSTS APPLICABLE TO REVENUE 

104,152,962 96,103,122 11,550,224 6,561,200 

The operating costs classified by nature, applicable to revenue, are as follows: 

Property development 

expenditure recognised 

Cost of inventories sold 

Cost of land sold 

Construction contract costs 

Staff costs* 

Directors’ remuneration#: 

Fee 

Other emoluments 

Depreciation of property, 

plant and equipment 

Cost of oil palm fruits 

Allowance for foreseeable loss 

Other operating expenses 


2012 2011 2012 2011 

RM RM RM RM 

45,953,367 

6,363,200 

11,385,244 

- 

3,662,160 

184,000 

1,704,803 

597,977 

558,076 

44,000 

5,719,695 

76,172,522 

39,944,686 

16,045,701 

5,763,689 

195,987 

2,928,386 

202,000 

2,113,323 

736,916 

488,685 

- 

4,942,561 

73,361,934 

- 

- 

- 

- 

435,273 

184,000 

487,020 

- 

- 

- 

377,993 

1,484,286 

- 

- 

- 

- 

404,585 

182,000 

487,020 

- 

- 

- 

296,588 

1,370,193 

* Included in staff costs of the Group and of the Company are EPF contributions of RM409,730 and 

RM47,612 (RM310,406 and RM43,036 in 2011) respectively. 

# The directors’ remuneration disclosed above, represents the entire key management personnel 

compensation of the Group and the Company as there were no other key management personnel 

apart from all the directors who have the authority and responsibility, directly or indirectly, for planning, 

directing and controlling the activities of the Group and of the Company. Details on the compensation 

for these key management personnel are disclosed as follows:




2012 2011 2012 2011 

RM RM RM RM 

Directors of the Company: 

Executive directors 

- Salary and other emoluments 876,240 857,840 424,620 424,620 

- EPF contributions 104,040 101,832 50,400 50,400 

980,280 959,672 475,020 475,020 

Non-executive directors 

- Fee 184,000 182,000 184,000 182,000 

- Other emoluments 8,000 64,100 12,000 12,000 

- EPF contributions - 2,412 - - 

192,000 248,512 196,000 194,000 

1,172,280 1,208,184 671,020 669,020 

Directors of subsidiary companies: 

- Fee - 20,000 - - 

- Salary and other emoluments 639,819 1,006,451 - - 

- EPF contributions 76,704 80,688 - - 

6. INVESTMENT REVENUE 

716,523 1,107,139 - - 

1,888,803 2,315,323 671,020 669,020 


2012 2011 2012 2011 

RM RM RM RM 

Interest income from: 

Housing Development Accounts 43,346 38,157 - - 

Fixed deposits 12,650 27,066 - - 

Others 42,310 28,641 22,927 12,529 

7. FINANCE COSTS 

Interest on: 

Term loans 

Bank overdrafts 

Hire-purchase 

Bridging loan 

Less: Amounts capitalised in cost of qualifying assets 

98,306 93,864 22,927 12,529 

The Group 

2012 2011 

RM RM 

1,767,984 

1,300,313 

19,531 

- 

3,087,828 

(2,128,118) 

959,710 

1,770,823 

958,925 

27,601 

4,137 

2,761,486 

(2,164,313) 

597,173 

During the financial year, borrowing costs arising from the specific borrowing pool which have been 

capitalised as part of the costs of qualifying assets are calculated by applying a capitalisation rate 

ranging from 5.10% to 8.10% (4.80% to 8.10% in 2011) per annum to expenditures on such assets. 

01 45 


46 




8. PROFIT BEFORE TAX 

Profit before tax has been arrived at after crediting (charging) the following: 

Gain on disposal of: 

Investment property 


Fair value gain on investment property 

Deposits forfeited 

Amount written off for: 


Other deposits 

Auditors’ remuneration: 

Non-statutory audit 

Statutory audit 

Rental of: 

Lease line and network 

Premises 

Projects terminated 

9. SEGMENTAL ANALYSIS 

Business segments 


2012 2011 2012 2011 

RM RM RM RM 

For management purposes, the Group is organised into the following reportable operating segments 

based on their products and services and same similar economic characteristics: 

- Property development (include construction contract) 

- Property management (include rental of properties) 

1,952,281 

50 

116,006 

35,050 

(6,421) 

- 

(6,500) 

(135,500) 

(99,718) 

(185,846) 

- 

- 

110,183 

4,524,605 

53,821 

(8,800) 

(4,000) 

(5,500) 

(130,000) 

(47,153) 

(182,896) 

(9,878) 

Management monitors the operating results of its business units separately for the purpose of making 

decisions about resource allocation and performance assessment. Segment performance is evaluated 

based on operating profit or loss which, in certain respects as explained in the table below, is measured 

differently from operating profit or loss in the consolidated financial statements. Operating profit and loss 

are regularly reviewed by chief operating decision maker to make decisions about resources to be 

allocated to the segment and assess the Group’s performance. The Group’s income taxes are 

managed on a group basis and are not allocated to operating segments. 

Transfer prices between operating segments are on an arm’s length basis in a manner similar to 

transactions with third parties. 

Segment capital expenditure comprises additions to property, plant and equipment and investment 

properties. 

No geographical segmental analysis is presented as the Group operates principally in Malaysia. 

- 

- 

- 

- 

- 

- 

(1,500) 

(22,000) 

- 

(72,000) 

- 

- 

- 

- 

- 

- 

- 

(1,500) 

(22,000) 

- 

(72,000) 

-



The Group 

2012 

Revenue 

External sales 

Inter-segment income^ 

Total revenue 

Results 


Finance costs 

Depreciation 

Fair value gain on investment 

property 

Unallocated corporate expenses 


Assets 

Addition to investment properties 

Addition to property, plant and 

equipment 

Segment assets 

Unallocated corporate assets 

Consolidated assets 

Liabilities 

Segment liabilities 

Unallocated corporate liabilities 

Consolidated liabilities 

The Group 

2011 

Revenue 

External sales 

Inter-segment income^ 

Total revenue 

Results 


Finance costs 

Depreciation 

Fair value gain on investment 

property 

Unallocated corporate expenses 


Property Property 

development management Others* Elimination Consolidated 

RM RM RM RM RM 

95,048,631 

- 

95,048,631 

55,421 

127,235 

119,243 

- 

- 

24,796,709 

- 

17,993 

270,504,468 

114,075,551 

86,796,639 

- 

86,796,639 

64,189 

97,728 

250,336 

- 

- 

19,670,595 

7,563,881 

216,000 

7,779,881 

9,553 

819,731 

244,315 

116,006 

- 

5,089,151 

275,669 

526,446 

96,181,618 

27,214,923 

7,326,426 

216,000 

7,542,426 

6,282 

491,884 

275,470 

4,524,605 

- 

7,562,214 

1,540,450 

15,979,824 

17,520,274 

33,332 

12,744 

234,419 

- 

1,484,286 

9,834,865 

- 

435,941 

30,551,525 

3,562,941 

1,980,057 

10,392,900 

12,372,957 

23,393 

7,561 

211,110 

- 

1,370,193 

5,253,922 

- 

(16,195,824) 

(16,195,824) 

- 

- 

- 

- 

- 

(10,131,824) 

- 

- 

(42,187,800) 

(51,837,800) 

- 

(10,608,900) 

(10,608,900) 

- 

- 

- 

- 

- 

(5,139,200) 

104,152,962 

- 

104,152,962 

98,306 

959,710 

597,977 

116,006 

1,484,286 

29,588,901 

275,669 

980,380 

355,049,811 

3,616,428 

358,666,239 

93,015,615 

241,722 

93,257,337 

96,103,122 

- 

96,103,122 

93,864 

597,173 

736,916 

4,524,605 

1,370,193 

27,347,531 

01 47 


48 




The Group 

2011 

Assets 

Addition to investment properties 

Addition to property, plant and 

equipment 

Segment assets 

Unallocated corporate assets 

Consolidated assets 

Liabilities 

Segment liabilities 

Unallocated corporate liabilities 

Consolidated liabilities 

Property Property 

development management Others* Elimination Consolidated 

RM RM RM RM RM 

* The operating divisions which fall below the quantitative thresholds and cannot be aggregated to 

form a reportable operating segment includes small plantation business and Group-level corporate 

services and treasury functions. 

^ Inter-segment income are eliminated upon consolidation and reflected in the eliminations' column. 

10. INCOME TAX EXPENSE 

Current tax expense: 

Current year 

(Under)Overprovision in prior year 

Deferred tax (Note 23): 

Origination and reversal 

of temporary differences 

- 

2,541 

253,749,624 

101,665,741 

6,931,869 

942,649 

99,569,801 

35,680,978 


2012 2011 2012 2011 

RM RM RM RM 

(7,939,378) 

(11,881) 

630,709 

(7,320,550) 

Malaysian corporate income tax is calculated at the statutory tax rate of 25% (also 25% in 2011) of 

the estimated taxable profit for the year. 

- 

255,828 

28,676,474 

7,137,273 

(6,210,583) 

9,184 

257,867 

(5,943,532) 

- 

- 

(42,163,353) 

(52,927,653) 

(1,293,103) 

300 

- 

(1,292,803) 

6,931,869 

1,201,018 

339,832,546 

740,095 

340,572,641 

91,556,339 

241,632 

91,797,971 

(1,077,760) 

- 

- 

(1,077,760)



The reconciliation between tax expense and accounting profit multiplied by the applicable statutory 

tax rate are as follows: 


Tax at the applicable statutory tax rate of 25% 

Tax effects of: 

Expenses not deductible for tax purposes 

Income not assessable for tax purposes 

Other temporary differences not taken up 

(Under)Overprovision of income tax in prior year 

Income tax expense recognised in profit or loss 


2012 2011 2012 2011 

RM RM RM RM 

The Company had elected for the irrevocable option to disregard the Section 108 tax credits and 

moved to single-tier system since 2011. 

By virtue of the Real Property Gains Tax (“RPGT”) Exemption Order 2012, the effective RPGT rate 

applicable from 1 January 2013 on gains from disposal of real property within two years is 15% and 10% 

for disposal between third to fifth years. Any gain from disposal of real property after fifth year will be 

RPGT exempted. Following this, no deferred tax arising from the intended recovery of real property 

through sales is recognised. 

11. EARNINGS PER ORDINARY SHARE 

Basic/Diluted 

Profit attributable to ordinary shares (RM) 

Number of shares in issue as of beginning/ 

end of year (Units) 

Weighted average number of ordinary shares (Units) 

Basic/Diluted earnings per share (sen) 

29,588,901 

(7,397,227) 

(299,959) 

525,017 

(136,500) 

(11,881) 

(7,320,550) 

27,347,531 

(6,836,882) 

(251,821) 

1,135,987 

- 

9,184 

(5,943,532) 

10,088,865 

(2,522,216) 

(64,119) 

1,293,232 

- 

300 

(1,292,803) 

5,203,536 

(1,300,884) 

(42,508) 

265,632 

The Group 

2012 2011 

22,268,351 

375,607,960 

375,607,960 

5.93 

- 

- 

(1,077,760) 

21,403,999 

375,607,960 

375,607,960 

5.70 

01 49 


50 




12. PROPERTY, PLANT AND EQUIPMENT 

The Group Motor 

vehicles 

Motor under hire - Office Furniture 

vehicles purchase equipment and fittings Renovations Total 

RM RM RM RM RM RM 

Cost 


Additions 

Reclassification 

Disposals/Written off 


Additions 




Accumulated Depreciation 


Charge for the year 




Charge for the year 




Net Book Value 



818,340 

- 

463,604 

(589,688) 

692,256 

- 

726,327 

- 

1,418,583 

565,645 

138,451 

244,238 

(506,423) 

441,911 

138,451 

726,325 

- 

1,306,687 

111,896 

250,345 

1,704,874 

166,300 

(463,604) 

- 

1,407,570 

419,838 

(726,327) 

- 

1,101,081 

901,044 

294,599 

(244,238) 

- 

951,405 

163,591 

(726,325) 

- 

388,671 

712,410 

456,165 

514,841 

150,173 

- 

(97,123) 

567,891 

50,916 

- 

(7,128) 

611,679 

369,307 

41,408 

- 

(86,691) 

324,024 

48,882 

- 

(4,995) 

367,911 

243,768 

243,867 

1,127,790 

785,235 

- 

(44,172) 

1,868,853 

364,285 

- 

(112,505) 

2,120,633 

820,752 

232,895 

- 

(39,302) 

1,014,345 

211,934 

- 

(108,216) 

1,118,063 

1,002,570 

854,508 

238,068 

99,310 

- 

- 

337,378 

145,341 

- 

- 

482,719 

124,761 

29,563 

- 

- 

154,324 

35,119 

- 

- 

189,443 

293,276 

183,054 

4,403,913 

1,201,018 

- 

(730,983) 

4,873,948 

980,380 

- 

(119,633) 

5,734,695 

2,781,509 

736,916 

- 

(632,416) 

2,886,009 

597,977 

- 

(113,211) 

3,370,775 

2,363,920 

1,987,939 

Non-Cash Transactions 

During the financial year, the Group acquired property, plant and equipment amounting to RM980,380 (RM1,201,018 

in 2011) of which RM630,380 (RM1,061,018 in 2011) were made by cash payments. The remaining additions of 

RM350,000 (RM140,000 in 2011) were made by hire-purchase arrangement. 

13. INVESTMENT PROPERTIES 

At fair value: 

At beginning of year 

Costs incurred for investment property under 

construction 

Fair value gain recognised in profit or loss 

Disposal during the year 

At end of year 

The Group 

2012 2011 

RM RM 

87,626,251 

159,663 

116,006 

(4,422,719) 

83,479,201 

76,169,777 

6,931,869 

4,524,605 

- 

87,626,251



Rental income derived from investment properties 

Direct operating expenses generating rental income 

Profit arising from investment properties carried at fair 

value net of direct operating expenses 

The Group 

2012 2011 

RM RM 

The fair value of investment properties as of 31 December 2012 has been arrived at on the basis of a 

valuation carried out by independent valuers which have appropriate qualifications and recent 

experience in the valuation of properties in the relevant locations except for cost incurred for 

investment property under construction. The valuation was arrived at by reference to market evidence 

of transaction prices for similar properties. 

Investment properties of the Group with carrying amount of RM79,919,201 (RM73,981,251 in 2011) have 

been charged to licensed banks as security for term loans and bank overdraft facilities granted to the 

Group as disclosed in Note 22. 

All of the Group’s investment properties are held under freehold interests. 

14. LAND HELD FOR PROPERTY DEVELOPMENT 

At cost: 

Freehold land 

Long-term leasehold land 

Development expenditure 


Cost incurred during the year: 

Freehold land 



Transfer from land and development expenditure (Note 17): 

Freehold land 


Transfer to land and development expenditure (Note 17): 

Freehold land 



Disposal during the year: 

Freehold land 



Project terminated 


7,563,881 

(4,133,134) 

3,430,747 

6,966,426 

(4,229,065) 

2,737,361 

The Group 

2012 2011 

RM RM 

82,720,230 

66,483,669 

21,892,034 

171,095,933 

3,308,394 

- 

18,414,164 

21,722,558 

192,818,491 

- 

- 

- 

(6,562,720) 

(8,699,563) 

(10,751,421) 

(26,013,704) 

(7,510,309) 

(109,208) 

(3,765,727) 

(11,385,244) 

- 

155,419,543 

76,644,116 

64,775,827 

22,028,971 

163,448,914 

22,919,988 

1,742,700 

9,317,212 

33,979,900 

197,428,814 

28,841 

364 

29,205 

(11,743,532) 

- 

(8,844,987) 

(20,588,519) 

(5,129,183) 

(34,858) 

(599,648) 

(5,763,689) 

(9,878) 

171,095,933 

01 51 


52 




As of 31 December 2012, the title to certain freehold and leasehold lands belonging to certain 

subsidiary companies, with cost of RM472,989 (RM1,890,020 in 2011) and RMNil (RM343,150 in 2011), 

have yet to be registered in the name of the said subsidiary companies. 

Certain subsidiary companies of the Group had entered into agreements with landowners to develop 

the landowners’ land into housing estates. Pursuant to the agreements, the subsidiary companies are 

responsible for the development and sale of properties the sales proceeds are shared between the 

subsidiary companies and landowners on the basis stipulated in the agreements. 

Land held for property development of the Group with carrying amount of RM102,729,704 

(RM114,463,085 in 2011) are charged to licensed banks for borrowings granted to the Group as 

disclosed in Note 22. 

Included in the development expenditure of the Group is interest capitalised during the financial year 

amounting to RM1,371,994 (RM1,838,605 in 2011). 

15. INVESTMENT IN SUBSIDIARY COMPANIES 

The Company 

2012 2011 

RM RM 

Unquoted shares, at cost 170,830,419 170,830,419 

The subsidiary companies which are wholly-owned and incorporated in Malaysia are as follows: 

Name of Company Principal Activities 

Direct Subsidiary Companies 

Idealbase Sdn. Bhd. General and property construction, provision 

of project management services 

Wisma Development Sdn. Bhd. Investment holdings and property development 

Ayer Hitam Land Sdn. Bhd. Property development 

Sakae Corporation Sdn. Bhd. Property holdings and development 

Ayer Hitam Sawmill Company Sdn. Bhd. Property holdings and investments 

Cheng Yew Heng Manufactory Sdn. Berhad Property holdings and investments 

Emerald Park Sdn. Bhd. Property development, investment holdings 

and the letting of apartments and shop offices 

Simpang Maju Enterprises Sdn. Bhd. Property development 

Taman Pahlawan Sdn. Bhd. Property development 

Indirect Subsidiary Companies 

# Prairie Development Sdn. Bhd. Property development 

@ Vinlane Development Sdn. Bhd. Property development 

@ Shinwoo Development Sdn. Bhd. Property development 

* Multinat Property Sdn. Bhd. Property holdings and investments 

+ Summer Range Sdn. Bhd. Sales of oil palm fruits and property 

development 

+ Rainbow Entity Sdn. Bhd. Property development 

+ Harmony Gallery Sdn. Bhd. Property development 

& Hillpark Development Sdn. Bhd. Property development 

& Regal Park Sdn. Bhd. Property investments and letting of apartments 

# This investment is held through its subsidiary company, Idealbase Sdn. Bhd. 

@ These investments are held through its subsidiary company, Wisma Development Sdn. Bhd. 

* This investment is held through its subsidiary company, Sakae Corporation Sdn. Bhd. 

+ These investments are held through its subsidiary company, Ayer Hitam Sawmill Company Sdn. Bhd. 

& These investments are held through its subsidiary company, Emerald Park Sdn. Bhd.



16. INVENTORIES 

The Group 

2012 2011 

RM RM 

At cost: 

Completed development units for sale 5,384,167 6,178,779 

As of 31 December 2012, the title to certain inventories belonging to certain subsidiary companies, with 

cost of RM1,281,336 (RM1,895,848 in 2011), have yet to be registered in the name of the said subsidiary 

companies. 

17. LAND AND DEVELOPMENT EXPENDITURE 

At cost: 

Freehold land 




Cost incurred during the year: 

Freehold land 


Transfer from land held for property development (Note 14): 

Freehold land 



Transfer to land held for property development (Note 14): 

Freehold land 


Costs recognised as an expense in profit or loss: 

Previous year 

Current year 


Current year 

Transfer to inventories 


The Group 

2012 2011 

RM RM 

17,016,454 

191,587 

37,843,473 

55,051,514 

2,318,704 

48,406,497 

50,725,201 

105,776,715 

6,562,720 

8,699,563 

10,751,421 

26,013,704 

As of 31 December 2012, the title to the certain freehold lands belonging to certain subsidiary 

companies with cost of RM4,285,210 (RM3,800,393 in 2011), have yet to be registered in the name of the 

said subsidiary companies. 

Certain subsidiary companies of the Group had entered into agreements with landowners to develop 

the landowners’ land into housing estates. Pursuant to the agreements, the subsidiary companies are 

responsible for the development and sale of properties. The sales proceeds are shared between the 

subsidiary companies and landowners on the basis stipulate in the agreements. 

- 

- 

- 

(22,763,108) 

(45,953,367) 

(68,716,475) 

(44,000) 

(5,568,588) 

57,461,356 

12,154,511 

947,474 

31,881,752 

44,983,737 

3,268,994 

36,024,535 

39,293,529 

84,277,266 

11,743,532 

- 

8,844,987 

20,588,519 

(28,841) 

(364) 

(29,205) 

(25,017,179) 

(39,944,686) 

(64,961,865) 

- 

(7,586,310) 

32,288,405 

01 53 


54 




Freehold land of the Group with carrying amount of RM20,372,283 (RM6,628,514 in 2011) are charged to 

licensed banks for bank facilities granted to the Group as disclosed in Note 22. 

Included in development expenditure of the Group is interest capitalised during the financial year 

amounting to RM756,124 (RM325,708 in 2011). 

18. RECEIVABLES 

Trade receivables 

Other receivables 

Rental receivables 

Accrued billings 

Rental deposits 

Other deposits 

Prepaid expenses 


2012 2011 2012 2011 

RM RM RM RM 

Trade receivables comprise mainly amounts receivable for sales of development projects and rental 

receivables. The average credit periods granted on sales of development projects is 21 days (also 21 

days in 2011) whilst rental receivable is ranging from 7 to 30 days (also 7 to 30 days in 2011). These 

receivables are not secured to any collateral. No interest is charged on outstanding balances from 

trade receivables which are past due. 

Other receivables represent mainly advances to landowners on certain development projects which 

are interest-free, unsecured and repayable on demand. 

Other deposits represent mainly downpayment for purchases of land and deposits for certain 

development projects. 

The ageing of trade receivables at the end of reporting date is as follows: 

Not past due or impaired 

Past due but not impaired 

23,909,918 

1,732,789 

52,828 

3,372,339 

29,067,874 

39,929 

10,162,620 

598,055 

39,868,478 

13,935,711 

1,997,062 

215,587 

8,661,262 

24,809,622 

38,799 

5,959,706 

282,845 

31,090,972 

The Group 

2012 2011 

RM RM 

The trade receivables that are past due at the reporting date but not impaired are supported by the 

credit facility from licensed banks or government authorities. 

- 

- 

- 

- 

- 

- 

4,400,000 

3,900 

4,403,900 

9,067,409 

14,842,509 

23,909,918 

- 

- 

- 

- 

- 

- 

- 

1,949 

1,949 

2,045,521 

11,890,190 

13,935,711



19. RELATED PARTIES TRANSACTIONS 

The amount owing by (to) subsidiary companies arose mainly from advances which are unsecured, 

interest-free and repayable on demand. 

During the year, significant related parties’ transactions are as follows: 

Subsidiary companies 

Dividend income 

Management fee income 

Rental of premises 

20. CASH AND BANK BALANCES 

The Company 

2012 2011 

RM RM 

The Group 

2012 2011 

RM RM 


2012 2011 2012 2011 

RM RM RM RM 

The Housing Development Accounts are maintained by certain subsidiary companies in accordance 

with Section 7A of the Housing Development (Control & Licensing) Act, 1966. These accounts, which 

consist of monies received from purchasers, are for the payment of property development expenditure 

incurred. The surplus monies, if any, will be released to subsidiary companies upon the completion of 

the property development projects and after all property development expenditure has been fully 

settled. 

Included in fixed deposits with licensed banks of the Group is an amount of RM844,643 (RM404,605 in 

2011) pledged to financial institutions as security by the subsidiary companies either for bank 

guarantees issued/to be issued in favour of third parties for the property development projects or term 

loan/overdraft facilities granted to a subsidiary company. 

The average interest rates are as follows: 

10,131,824 

1,418,400 

(72,000) 

5,139,200 

1,422,000 

(72,000) 

With a company in which certain directors has 

substantial interest 

Rental income 385,800 344,000 

Cash on hand and at banks 

Housing Development Accounts 

Fixed deposits with licensed banks 



8,486,583 

4,651,735 

844,643 

13,982,961 

5,059,674 

3,899,846 

404,605 

9,364,125 

3,612,528 

- 

- 

3,612,528 

The Group 

2012 2011 

% % 

The fixed deposits with licensed banks of the Group as of 31 December 2012 have an average maturity 

of 30 days (also 30 days in 2011). 

1.90 

2.70 

738,146 

- 

- 

738,146 

1.90 

2.70 

01 55 


56 




21. SHARE CAPITAL 

Authorised: 

1,000,000,000 ordinary shares of RM0.50 each 

Issued and fully paid: 

375,607,960 ordinary shares of RM0.50 each 

22. BANK BORROWINGS 

Secured: 

Term loans 

Bank overdrafts (Note 25) 


Less: Hire-purchase payables 

Interest-in-suspense outstanding 

Less: Amount due for settlement within 12 months 

(shown under current liabilities) 

Term loans 

Bank overdrafts 


Non-current portion 

The non-current portion of borrowings is repayable as follows: 

Term loans 

Later than one year but not later than two years 

Later than two years but not later than five years 

More than five years 


Later than one year but not later than two years 

Later than two years but not later than five years 

The Group and the Company 

2012 2011 

RM RM 

500,000,000 

187,803,980 

500,000,000 

187,803,980 

The Group 

2012 2011 

RM RM 

22,359,250 

27,403,843 

596,684 

50,359,777 

(54,539) 

50,305,238 

(3,277,910) 

(27,403,843) 

(168,749) 

(30,850,502) 

19,454,736 

3,568,402 

14,843,394 

669,544 

19,081,340 

117,655 

255,741 

373,396 

19,454,736 

28,669,183 

31,600,740 

406,428 

60,676,351 

(32,965) 

60,643,386 

(2,769,025) 

(31,600,740) 

(170,954) 

(34,540,719) 

26,102,667 

5,002,273 

16,034,042 

4,863,843 

25,900,158 

104,679 

97,830 

202,509 

26,102,667



The term loans and bank overdrafts of the Group are generally secured by legal charges over certain 

investment properties, certain parcel of the land held for property development, and land and 

development expenditure as disclosed in Note 13, 14 and 17 respectively. The term loans and bank 

overdrafts are also secured by corporate guarantee by the Company to the extent of RM116,455,000 

(RM96,655,000 in 2011). 

Certain bank overdrafts facilities of the Group amounting to RM8,042,323 (RM18,731,438 in 2011) are 

obtained by three of the subsidiary companies, for the purposes of on-lend to the related companies as 

term loan for property development projects undertaken by the related companies. The interest 

charged on the utilisation of bank overdraft facilities is reimbursed from the respective companies. 

The interest rates for bank overdrafts range from 5.10% to 8.10% (also 5.10% to 8.10% in 2011) per annum. 

The interest rates for term loans range from 5.45% to 7.10% (4.80% to 8.10% in 2011) per annum. 

The term for hire-purchase arrangement is 5 years. For the financial year ended 31 December 2012, the 

interest rates range from 2.31% to 3.80% (2.31% to 5.00% in 2011) per annum. Interest rate is fixed at the 

inception of the hire-purchase arrangements. 

The Group’s hire-purchase payables are secured by the assets under hire-purchase. 

23. DEFERRED TAX LIABILITIES 

2012 




2011 




The Group 

At beginning Recognised in At end 

of year profit or loss of year 

RM RM RM 

As mentioned in Note 3, the tax effect of deductible temporary difference, unused tax losses and 

unused tax credits which would give rise to deferred tax assets are generally recognised to the extent 

that it is probable that future taxable profits will be available against which the deductible temporary 

differences, unused tax losses and unused tax credits can be utilised. As of 31 December 2012, the 

estimated amount of net deferred tax assets of the Group calculated at current tax rate, which is not 

recognised in the financial statements due to uncertainty of its realisation in the foreseeable future is as 

follows: 

Tax effects of: 

Temporary differences arising from: 


Unutilised tax losses 


Unabsorbed capital allowances 

Impairment loss of land held for property development 

(3,863,411) 

(3,297,230) 

(106,000) 

(7,266,641) 

(4,270,278) 

(3,202,230) 

(52,000) 

(7,524,508) 

507,709 

117,000 

6,000 

630,709 

406,867 

(95,000) 

(54,000) 

257,867 

The Group 

Deferred Tax Assets (Liabilities) 

2012 2011 

RM RM 

(18,900) 

189,500 

11,000 

2,500 

458,500 

642,600 

(3,355,702) 

(3,180,230) 

(100,000) 

(6,635,932) 

(3,863,411) 

(3,297,230) 

(106,000) 

(7,266,641) 

(22,800) 

70,400 

- 

- 

458,500 

506,100 

The unutilised tax losses and unabsorbed capital allowances are subject to agreement by the tax 

authorities and are available to offset against future taxable profit. 

01 57 


58 




24. PAYABLES 

Trade payables 

Other payables 

Progress billings 

Rental received in advance 

Rental deposits 

Deposits received 

Accrued expenses 


2012 2011 2012 2011 

RM RM RM RM 

Trade payables comprise amounts outstanding for trade purchases, construction and other related 

development costs. The average credit period granted to the Group for trade purchases, construction 

and other related development costs is 30 days (also 30 days in 2011). Trade payables are non-interest 

bearing. 

Other payables comprise deposits from house buyers, advances and payments on behalf. 

Reconciliation of amount due to customers under construction contract: 

Contract in progress 

- Construction costs incurred 

- Recognised profits less recognised losses 

Less: Progress billings 

The Group 

2012 2011 

RM RM 

As of 31 December 2012, retentions held by customers for contract work amounted to RM70,059 

(RM148,837 in 2011). 

25. CASH AND CASH EQUIVALENTS 

Cash and cash equivalents comprise the following: 

Cash on hand and at banks 



Bank overdrafts (Note 22) 

Less: Fixed deposits pledged 

with licensed bank 

17,316,610 

4,315,404 

2,863,002 

24,495,016 

431,482 

1,351,027 

196,437 

6,391,620 

32,865,582 

8,269,995 

3,449,667 

1,123,968 

12,843,630 

453,559 

1,563,403 

92,636 

6,626,234 

21,579,462 

- 

4,275 

- 

4,275 

- 

- 

- 

217,300 

221,575 


2012 2011 2012 2011 

RM RM RM RM 

8,486,583 

4,651,735 

844,643 

(27,403,843) 

(13,420,882) 

(844,643) 

(14,265,525) 

5,059,674 

3,899,846 

404,605 

(31,600,740) 

(22,236,615) 

(404,605) 

(22,641,220) 

- 

- 

- 

- 

- 

3,612,528 

- 

- 

- 

3,612,528 

- 

3,612,528 

- 

- 

- 

- 

- 

- 

- 

212,000 

212,000 

2,240,509 

736,236 

2,976,745 

(2,976,745) 

- 

738,146 

- 

- 

- 

738,146 

- 

738,146



26. DIVIDENDS 

Final dividend paid – 1%, single 

tier for 2011 (1%, less 25% tax for 2010) 

Interim dividend paid – 2%, 

single tier (1%, single tier in 2011) 

Net dividend 

per share 

2012 2011 2012 2011 

RM RM RM RM 

The directors proposed a final single tier dividend of 1% amounting to RM1,878,040 in respect of the 

current financial year. The proposed final dividend is subject to the approval by the shareholders at the 

forthcoming Annual General Meeting of the Company and has not been included as liability in the 

financial statements. 

27. FINANCIAL INSTRUMENTS 

(a) Capital risk management policies and objectives 

The Group manages its capital to ensure that entities in the Group and the Company will be able 

to continue as going concerns while maximising the return to stakeholders through the optimisation 

of the debt and equity balance. The Group’s and the Company’s overall strategy remains 

unchanged from 2011. 

The capital structure of the Group consists of net debt, which includes the bank borrowings, 

payables, less cash and bank balances, and equity of the Group, comprising issued capital and 

retained earnings as presented in the statement of changes in equity. 

The Group’s management reviews the capital structure regularly to achieve an appropriate capital 

structure. As part of this review, the Group’s management considers the cost of capital and the risk 

associated with each class of capital and makes adjustments to the capital structure, where 

appropriate, in light of changes in economic conditions and the risk characteristics of the 

underlying assets. 

The Group monitors capital using gearing ratio, which is net debt divided by total equity plus net 

debt. 

The gearing ratio at the end of the reporting period was as follows:- 


Payables 

Amount owing to a 

subsidiary company 

Less: Cash and bank balances 

Net debt 

Equity attributable to the owners of 

the parent 

Equity and net debt 

Gearing ratio 

(b) Significant accounting polices 

1,878,040 

3,756,079 

5,634,119 

1,408,530 

1,878,040 

3,286,570 

0.005 

0.010 

0.015 

0.004 

0.005 

0.009 


2012 2011 2012 2011 


22 

24 

19 

20 

50,305,238 

32,865,582 

- 

(13,982,961) 

69,187,859 

265,408,902 

334,596,761 

60,643,386 

21,579,462 

- 

(9,364,125) 

72,858,723 

248,774,670 

321,633,393 

- 

221,575 

3,000,000 

(3,612,528) 

(390,953) 

185,255,125 

184,864,172 

Details of the significant accounting policies and methods adopted (including the criteria for 

recognition, the bases of measurement, and the bases for recognition of income and expenses) for 

each class of financial asset, financial liability and equity instrument are disclosed in Note 3. 

21% 

23% 

- 

- 

212,000 

- 

(738,146) 

(526,146) 

182,093,182 

181,567,036 

- 

01 59 


60 




(c) Categories of financial instruments 

Financial assets 

L & R: 

- Cash and bank balances 

- Receivables 

- Amount owing by subsidiary companies 

Financial liabilities held at amortised cost 

Other liabilities: 

- Payables 

- Amount owing to a subsidiary company 

- Bank borrowings 

(d) Financial risk management objectives and policies 


2012 2011 2012 2011 

RM RM RM RM 


2012 2011 2012 2011 

RM RM RM RM 

The Group and the Company are exposed to financial risks arising from their operations and the use 

of financial instruments. The key financial risks include credit risk, liquidity risk and interest rate risk. 

The following sections provide details regarding the Group’s and Company’s exposure to the 

above-mentioned financial risks and the objectives, policies and processes for the management of 

these risks. 

(i) Credit risk 

Credit risk is the risk of loss that may arise on outstanding financial instruments should a counterparty 

default on its obligations. The Group’s and the Company’s exposure to credit risk arises primarily 

from trade receivables and corporate guarantee provided by the Company to licensed banks on 

subsidiary companies’ borrowings. For other financial assets (including cash and bank balances), 

the Group and the Company minimise credit risk by dealing exclusively with high credit rating 

counterparties. 

The trade receivables consist of a large number of customers and the Group does not have any 

significant credit risk exposure to any single customer. The Group trades only with recognised and 

creditworthy third parties and customers who have credit facility from licensed banks or 

government authorities. It is the Group’s policy that all customers who wish to trade on credit terms 

are subject to credit verification procedures. In addition, receivable balances are monitored on an 

ongoing basis with the result that the Group’s exposure to bad debts is not significant. 

At the reporting date, the Company’s maximum exposure to credit risk is represented by corporate 

guarantee of RM116,455,000 (RM96,665,000 in 2011) provided to banks for banking facilities granted 

to its subsidiary companies. Based on expectations at the end of the reporting period, the 

Company considers that it is unlikely that the Company will be required to settle any outstanding 

borrowing under the arrangement since the subsidiary companies had settled the outstanding 

borrowings as and when they fall due. 

(ii) Liquidity risk 

13,982,961 

35,898,084 

- 

49,881,045 

25,386,305 

- 

50,305,238 

75,691,543 

9,364,125 

22,146,865 

- 

31,510,990 

18,777,312 

- 

60,643,386 

79,420,698 

3,612,528 

4,400,000 

9,650,000 

17,662,528 

221,575 

3,000,000 

- 

3,221,575 

738,146 

- 

10,764,300 

11,502,446 

212,000 

- 

- 

212,000 

The Group’s and the Company’s exposure to liquidity risk arises primarily from mismatches of the 

maturities of financial assets. Liquidity risk is the risk that the Group or the Company will encounter 

difficulty in meeting financial obligations due to shortage of funds.



The Group maintains sufficient cash and cash equivalents, and internally generated cash flows to 

finance their activities. The Group manages liquidity risk by maintaining a balance between 

continuity of funding and flexibility through the use of stand-by credit facilities with five different 

banks and by monitoring forecast and actual cash flows and matching the maturity profile of the 

borrowings. 

As of 31 December 2012, the contractual undiscounted cash flows of the Group’s and the 

Company’s financial liabilities, grouped by maturity profiles, are as follows: 

The Group 

31 December 2012 

Payables 


The Group 


Payables 


The Company 


Payables 

Amount owing 

to a subsidiary company 


Payables 

On demand 

Contractual or within Two to five Over five 

interest rate one year years years Total 

% RM RM RM RM 

As of 31 December 2012, the contractual undiscounted cash flows of the Group’s and the 

Company’s financial assets, grouped by maturity profiles, are as follows: 

The Group 


Receivables 



Receivables 


- 

2.31 – 8.10 

- 

2.31 - 8.10 

- 

- 

- 

- 

21,605,165 

21,605,165 

- 

26,426,948 

26,426,948 

- 

719,705 

719,705 

- 

5,060,961 

5,060,961 

On demand 



% RM RM RM RM 

- 

1.90 - 2.70 

- 

1.90 - 2.70 

25,386,305 

32,220,219 

57,606,524 

18,777,312 

37,677,865 

56,455,177 

221,575 

3,000,000 

3,221,575 

212,000 

35,898,084 

13,982,961 

49,881,045 

22,146,865 

9,364,125 

31,510,990 

- 

- 

- 

- 

- 

- 

- 

- 

- 

- 

- 

- 

- 

- 

- 

- 

- 

- 

- 

- 

25,386,305 

54,545,089 

79,931,394 

18,777,312 

69,165,774 

87,943,086 

221,575 

3,000,000 

3,221,575 

212,000 

35,898,084 

13,982,961 

49,881,045 

22,146,865 

9,364,125 

31,510,990 

01 61 


62 




The Company 


Receivables 

Amount owing by 

subsidiary companies 



Amount owing by 

subsidiary companies 


On demand 



% RM RM RM RM 

The Group has access to financing facilities of which RM44,346,157 (RM26,933,760 in 2011) were 

unused at the end of the reporting period for the Group. The Group expects to meet its other 

obligations from operating cash flows and proceeds of maturing financial assets. 

Secured bank overdraft facility 

- amount used 

- amount unused 

(iii) Interest rate risk 

The Group 

2012 2011 

RM RM 

Interest rate risk is the risk that the fair value or future cash flows of the Group’s financial instruments 

will fluctuate because of changes in market interest rates. 

The Group’s exposure to interest rate risk arises primarily because the bank borrowings are at 

floating interest rates. The Group’s policy is to manage interest cost by monitoring and negotiating 

the interest rate with the licensed banks periodically. 

Interest rate sensitivity 

At the reporting date, if interest rates had been 50 basis points higher or lower and all other 

variables were held constant, there would be no significant impact to the Group’s net profit after 

tax and equity. 

(e) Fair values of financial assets and financial liabilities 

- 

- 

- 

- 

- 

4,400,000 

9,650,000 

3,612,528 

17,662,528 

10,764,300 

738,146 

11,502,446 

The carrying amounts of cash and cash equivalents, trade and other receivables, trade and other 

payables, intercompany’s balances, bank overdrafts and hire-purchase payables are approximate 

their respective fair values due to the relatively short-term maturity of these financial instruments or 

they are floating rate instruments that are re-priced to market interest rates on or near the reporting 

date. The fair values of other classes of financial assets and liabilities are disclosed in the respective 

notes to financial statements. 

The fair values of financial liabilities which are not carried at fair value in the statement of financial 

position as at the end of the reporting period, are as follows: 

- 

- 

- 

- 

- 

- 

- 

27,403,843 

44,346,157 

71,750,000 

- 

- 

- 

- 

- 

- 

- 

4,400,000 

9,650,000 

3,612,528 

17,662,528 

10,764,300 

738,146 

11,502,446 

31,600,740 

26,933,760 

58,534,500



The Group 

2012 2011 

Carrying Fair Carrying Fair 

Note amount Value amount value 

RM RM RM RM 

Financial Liabilities 


- Term loans 22 22,359,250 21,814,935 28,669,183 28,284,336 

The fair values are determined based on the present value of future principal and interest cash flows, 

discounted at the market rate of interest at the end of the reporting period. 

28. MATERIAL CLAIMS 

The Company has instituted a legal proceeding against a vendor for specific performance of the Sales 

and Purchase Agreement in respect the sales of land by the vendor on 30 July 2012. The legal case is 

pending for trial. The Board of Directors is of the view that the legal claim will be successful. 

29. COMPARATIVE FIGURES 

The following comparative figures as of 31 December 2011, have been reclassified to conform with the 

presentation of current financial year: 

The Group 


Joint venture projects held for 

property development 

Land and development expenditure 

Joint venture development 

expenditure 

Previously Restated 

stated Reclassification balance 

RM RM RM 

170,515,427 

580,506 

25,749,068 

6,539,337 

580,506 

(580,506) 

6,539,337 

(6,539,337) 

171,095,933 

- 

32,288,405 

- 

01 63 


64 




30. SUPPLEMENTARY INFORMATION - DISCLOSURE ON REALISED AND UNREALISED PROFITS / LOSSES 

The supplementary information, which is not part of the financial statements, is prepared in all material 

respects, in accordance with Guidance on Special Matter No. 1. “Determination of Realised and 

Unrealised Profits or Losses in the Context of Disclosure Pursuant to Bursa Malaysia Securities Berhad 

Listing Requirements” as issued by the Malaysian Institute of Accountants and the directive of Bursa 

Malaysia. 

The breakdown of the retained earnings of the Group and of the Company as of 31 December into 

realised and unrealised profits or losses, pursuant to the directive, is as follows: 

Realised 

Unrealised 

Consolidation adjustment 

Total retained earnings 

as per financial statements 


2012 2011 2012 2011 

RM RM RM RM 

143,665,948 

25,446,821 

169,112,769 

(91,507,847) 

77,604,922 

120,267,855 

30,687,552 

150,955,407 

(89,984,717) 

60,970,690 

(2,548,855) 

- 

(2,548,855) 

- 

(2,548,855) 

(5,710,798) 

- 

(5,710,798) 

- 

(5,710,798)

STATEMENT BY DIRECTORS 

The directors of GROMUTUAL BERHAD state that, in their opinion, the accompanying financial statements 

are drawn up in accordance with Financial Reporting Standards and the provisions of 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 2012 and of the financial performance and the cash flows of the Group 

and of the Company for the year ended on that date. 

The supplementary information set out in Note 30, which is not part of the financial statements, is 

prepared in all material respects, in accordance with Guidance on Special Matter No. 1 “Determination 

of Realised and Unrealised Profits or Losses in the Context of Disclosure Pursuant to Bursa Malaysia 

Securities Berhad Listing Requirements” as issued by the Malaysian Institute of Accountants and the 

directive of Bursa Malaysia Securities Berhad. 

Signed in accordance with 

a resolution of the Directors, 

TEO AH BAH @ TEO CHUANG KWEE 

CHEW KWEE HIOK 

Johor Bahru 


DECLARATION BY THE DIRECTOR PRIMARILY 

RESPONSIBLE FOR THE FINANCIAL 

MANAGEMENT OF THE COMPANY 

I, TEO AH BAH @ TEO CHUANG KWEE, the director primarily responsible for the financial management of 

GROMUTUAL BERHAD, do solemnly and sincerely declare that the accompanying financial statements 

are, in my opinion, 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. 

TEO AH BAH @ TEO CHUANG KWEE 

Subscribed and solemnly declared by the abovenamed TEO AH BAH @ TEO CHUANG KWEE at JOHOR 

BAHRU in the State of JOHOR on 25 February 2013. 

Before me, 

HARCHARAN SINGH A/L CHANCHEL SINGH (No. J210) 

COMMISSIONER FOR OATHS 

01 65 


66 


ANALYSIS OF SHAREHOLDINGS 

as at 9 APRIL 2013 

Authorised Capital : RM 500,000,000 

Issued and Paid-up Capital : RM 187,803,980 

Class of Shares : Ordinary Shares of RM 0.50 each 

Voting Rights : One vote per ordinary share 

Size of Shareholdings 

Size No. of Holders % No. of Shares Held % 

Less than 100 4 0.162 165 0.000 

100-1,000 53 2.150 35,592 0.010 

1,001-10,000 1,492 60.527 7,241,368 1.928 

10,001-100,000 732 29.696 26,559,333 7.071 

100,001-18,780,397 * 181 7.343 221,771,502 59.043 

18,780,398 and above ** 3 0.122 120,000,000 31.948 

* less than 5% of issued shares 

** 5% and above of issued shares 

Thirty Largest Shareholders 

Total 2,465 100.00 375,607,960 100.00 

Name No. of Shares Held % 

1 AMSEC NOMINEES (TEMPATAN) SDN. BHD. 

SYARIKAT REAL PROPERTIES SDN. BHD. 40,000,000 10.65 

2 MAXWELL VENTURES SDN. BHD. 40,000,000 10.65 

3 T.K. TEO MANAGEMENT SDN. BHD. 40,000,000 10.65 

4 ASIA SELATAN (M) SDN. BHD. 11,349,900 3.02 

5 TAI KAM KUAN 11,268,730 3.00 

6 TEO AH BAH @ TEO CHUANG KWEE 10,000,000 2.66 

7 TEO YU HONG 9,957,973 2.65 

8 TEO YU YIN 9,957,973 2.65 

9 TEO CHIEW PENG 9,191,782 2.45 


TEO YU HAN 9,000,000 2.40 


TEO YU YANG 9,000,000 2.40 


TEO YU CHIN 9,000,000 2.40 

13 MAXIM MULTIMEDIA SDN. BHD. 8,500,000 2.26 


TEO CHOON KIAT @ TEO CHUAN KIT 6,349,699 1.69 

15 CHA AKU WAI @ SIA AH KOW 6,091,128 1.62 

16 TEO AH MOI @ TEO TIANG TIANG 5,834,726 1.55 

17 TAN AH SIM @ TAN SIEW WAH 5,826,596 1.55 

18 TAN HON KIAT @ TAN HOON SIONG 5,131,025 1.37 

19 CHOO CHIN YEW 5,058,377 1.35 

20 TEO AH BAH @ TEO CHUANG KWEE 4,523,986 1.21 

21 DIU DIAN HONG 4,283,036 1.14 

22 TAI TONG KUAN 4,000,000 1.06 

23 AMSEC NOMINEES (ASING) SDN BHD 

ONG TENG SER 3,784,190 1.01

Name No. of Shares Held % 

24 TEO CHIEW LUAN @ TEO CHIEW NGOH 3,676,561 0.98 


TEO CHOON KIAT @ TEO CHUAN KIT 3,500,000 0.93 


TEO YU YEN 2,873,917 0.77 

27 MOHD TAHIR BIN MOHD TAP 2,626,439 0.70 

28 NG CHOO MEAN 2,300,000 0.61 

29 MAYBANK SECURITIES NOMINEES (TEMPATAN) SDN. BHD. 

PLEDGED SECURITIES ACCOUNT FOR ONG HUEY PENG 2,219,200 0.59 

30 CHEW KWEE HIOK 2,058,094 0.55 

Substantial Shareholders with Holdings of 5% and Above 

Direct Indirect 

Name No. of % No. of % 

Shares Held Shares Held 


SYARIKAT REAL PROPERTIES SDN. BHD. 40,000,000 10.65 - - 

2 MAXWELL VENTURES SDN. BHD. 40,000,000 10.65 - - 

3 T.K. TEO MANAGEMENT SDN. BHD. 40,000,000 10.65 - - 

Directors' Shareholdings 

Direct Indirect 

Name No. of % No. of % 

Shares Held Shares Held 

1 TAN HON KIAT @ TAN HOON SIONG 5,131,025 1.37 17,184,626* 4.57 

2 TEO AH BAH @ TEO CHUANG KWEE 14,523,986 3.87 41,136,273 # 10.95 

3 NG CHOO MEAN 2,300,000 0.61 - - 

4 CHEW KWEE HIOK 2,058,094 0.55 - - 

5 TEO YU HONG 9,957,973 2.65 48,500,000 & 12.91 

6 YH DATO' CHONG KEAP THAI @ 

CHEONG KEAP TAI - - - - 

7 YEOH BENG SANG - - 40,000 ^ 0.01 

8 AZAHAR BIN BAHARUDIN - - - - 

9 TEO YU CHIN 9,000,000 2.40 - - 

* Deemed interest by virtue of his interest in Asia Selatan (M) Sdn. Bhd. and through his spouse, Teo Ah 

Moi @ Teo Tiang Tiang. 

# Deemed interest by virtue of his interest in T.K. Teo Management Sdn. Bhd. and through his spouse, 

Chung Ek Fong. 

& Deemed interest by virtue of his interest in Maxwell Venture Sdn. Bhd. and directorship in Maxim 

Multimedia Sdn. Bhd. 

^ Deemed interest through his spouse, Chian Soon Hwa. 

01 67 


68 


LIST OF PROPERTIES 

A) INVESTMENT PROPERTIES 

Location Land Tenure / 1) Land Area Description of Carrying Date of 

Date of Expiry Subject to Existing Use Amount as Valuation 

of Lease Valuation at 31.12.2012 

2) Age of Building RM 

3) Number of 

Storeys 

4) Gross Built-up 

Area and Net 

Usable Area 

1 HS(D) No 44970, Freehold 1) 2,661.0 sq m Building 7,343,950 01.01.2011 

PT No 4836, (New Geran (28,643.7 sq ft) (Apartment) 

34879 Lot 8605), Mukim of 2) 8 years old 

Bukit Baru, Daerah 3) 5 Storeys 

Melaka Tengah,Melaka 4) 8,402 sq.m 

(90,440 sq.ft.) 

2 HS(D) No 69009, PT Freehold 1) 6,347 sq m Building 22,500,000 31.12.2012 

No 7862, Mukim 2) 2 years old (Apartment) 

of Bukit Baru, Daerah 3) 10 Storeys 

Melaka Tengah, Melaka 4) 17,068.83 sq. m 

(183,727 sq ft) 

3 HS(D) Nos 44971 & 44972, Freehold 1) 4,848.0 sq m Building 17,739,000 30.08.2010 

PT Nos 4837 & 4838, (52,186.3 sq ft) (Apartment 

(New Geran 34880 & 2) 10 years old and 

34881, Lot 8606 & 8607) 3) 5 Storeys Commercial) 

Mukim of Bukit Baru, 4) 15,667.1 sq m 

Daerah Melaka Tengah, (168,648 sq ft) 

Melaka 

4 HS(M) Nos 4002 to Freehold 1) 30,650.7 sq m Industrial 14,600,000 01.01.2011 

4007 (inclusive), (329,933.7 sq ft) 

PTD Nos 43204 to 2) 13 to 16 years old 

43209 (inclusive) , 3) Factory: 1 storey 

Mukim of Senai-Kulai, Office : 2 storey 

Daerah Johor Bahru, 4) 13,484.8 sq m 

Johor Darul Takzim (145,154.0 sq ft) 

5 Grant Mukim No 72933, Freehold 1)5,975.77 sq m Industrial 3,560,000 01.01.2011 

PTB No 1588 (New Lot (64,327.20 sq ft) 

No 42669), Mukim of 2) 6 years old 

Senai-Kulai, Daerah of 3) Factory : 1 storey 

Johor Bahru, Johor Office : 2 storey 

Darul takzim 4) 2,816.04 sq m 

(30,312 sq ft) 

6 Grant Mukim No 72934, Freehold 1)7,411.24 sq m Industrial 4,075,000 01.01.2011 

PTB No 1589 (New Lot (79,774.0 sq ft) 

No 42670), Mukim of 2) 9 years old 

Senai-Kulai, Daerah 3) Factory : 1 storey 

Johor Bahru, Johor Office : 2 storey 

Darul Takzim 4) 3,424.8 sq m 

(36,865.0 sq ft) 

7 H.S (D) 186949 PTD Freehold 1) 34,966.20 sq m Industrial 13,661,251 01.01.2011 

39744, H.S (D) 385242 (376,377.46 sq ft) 

PTD 87573, H.S.(D) 385245 2) PTD Nos 87573 & 

PTD 87576 & H.S(D) 158748 39744 : 16 years 

PTD 35552, Mukim of old 

Senai-Kulai, Daerah Johor PTD Nos 87576 : 

Bahru, Johor Darul Takzim 18 years old 

PTD Nos 35552 : 15 

to 21 years old 

3) PTD Nos 39744, 

87573, 87576:- 

Factory: 1 storey 

Office : 2 storey 

PTD No 35552 : 1 

storey 

4) 13,607 sq m 

(146,390 sq ft)

LIST OF PROPERTIES (continue) 

B) PROPERTIES HELD FOR FUTURE DEVELOPMENT 


Date of Expiry Subject to Existing Use Amount as Valuation/ 

of Lease Valuation at 31.12.2012 Acquisition 

2) Gross Area RM 

1 PTD 190757 to 190760, Freehold 11.23 hectares Industrial 25,712,012 30.09.2003 

190763 to 190764, (27.76 acres) 

190788(New PTD 210944 

& 210945), 190791 to 

190794, 190797 to 

190802, 153577(New 

PTD 212933 & 212934) 

to 153578, 153580 to 

153581 HS(D) No. 

453570 to 453573, 

453576 to 453577, 

453601, 453604 to 

453607, 453610 to 

453615, 453617 to 

453618, 453619 to 

453620 Mukim of 

Plentong, Daerah 

Johor Bahru, Johor 

Darul Takzim 

2 Lot 1582, Geran 107157, Freehold 4,244.1407 sq m Residential 3,287,833 31.12.2012 

Mukim Bandar Johor 

Bahru, Johor Bahru, Johor 

3 HS(D) Nos 2792 & 2794, Leasehold for 148.065 hectares Agricultural 43,644,168 24.09.2010 

PTD Nos 681 & 683 930 years (365.869 acres) 

Mukim of Kota Tinggi, expiring on 

Daerah Kota Tinggi, 20.06.2911. 

Johor Darul Takzim It has an 

unexpired term 

of approximately 

899 years 

4 Geran Mukim Nos 2089, Freehold 4.024 hectares Industrial 2,290,646 01.01.2011 

Lot Nos 1648, Mukim of (9.943 acres) 

Kluang, Daerah of 

Kluang, Johor Darul 

Takzim 

5 PTD 75277 to 75279, Freehold 79,843 sq m Industrial 9,216,533 30.09.2003 

PTD 75282 to 75286, 

PTD 75288 to 75290, 

PTD 75296 & 75297 

HS(M) 16555 to 16565, 

HS(M) 16567 & 16568, 

Mukim of Kluang, 

Daerah Kluang, 

Johor Darul Takzim 

6 Grant Mukim No. 865, Freehold 2.197 hectares Agricultural 475,156 01.01.2011 

Lot Nos 11063, Mukim (5.429 acres) 

of Sri Gading, Daerah 

Batu Pahat, Johor 

Darul Takzim 

7 PT 5323 to 5325 Leasehold for 99 5.7852 hectares Residential 1,393,929 01.01.2011 

HS(D) 19388 to 19390 years expiring 

(Old PN No. 2659, on 11.08.2082. 

Lot 2126) Mukim Baru Ulu, It has an 

Daerah Alor Gajah, unexpired term 

Melaka of approximately 

70 years 

01 69 


70 







8 PT No. 2660 to 2683 & Leasehold for 99 10.631 acres Residential 3,534,233 30.04.2006 

5039 to 5096 years expiring on (43,023 sq m) 

Mukim Sungai Baru 11.08.2082. It 

Ulu, Daerah Alor Gajah, has an unexpired 

Melaka term of 

approximately 

71 years 

9 PT 2220 & 2221, Freehold 11.0316 Hectares Agricultural 4,097,155 26.03.2008 

PT 2232 & 2233 

HS(D) 70189 & 70190, 

HS(D) 72781 & 72182 

(Old Lot No. 3473 GRN 

38499), Mukim Sungai 

Udang, Daerah Melaka 

Tengah, Melaka 

10 GM 136 and 277 Freehold 4.0376 Hectares Agricultural 2,236,595 31.12.2011 

Lot. 1777 and 4687 

Mukim Sungai Baru Ihir, 

Daerah Aloh Gajah, 

Melaka 

11 PT 1313 HS(M) 63, Leasehold for 99 10,638 Sq m Commercial 797,449 31.12.2011 

Mukim Sungei Udang, years expiring on 

Daerah Melaka Tengah, 27.03.2094. It has 

Melaka an unexpired 

term of 

approximately 

82 years 

12 PT 1314 HS(M) 64, Leasehold for 99 7,257 Sq m Commercial 1,092,113 31.12.2011 

Mukim Sungei Udang, years expiring on 

Daerah Melaka Tengah, 27.03.2094. It has 

Melaka an unexpired 


approximately 

82 years 

13 Lot 1153, Mukim Tanjong Freehold 2.0311 acres Residential 1,599,227 12.09.2012 

Minyak, Melaka 

14 PTD 83011 & 83012 Freehold 1.2068 acres Industrial 353,358 01.01.2011 

HS(M) 17480 & 17481 (4,884.1 Sq m) 

(Old HS(M) 15204 PTD 

63980) Mukim Kluang 

Daerah Kluang, Johor 

15 PTD 83013 & 83014 Freehold 1.2068 hectares Industrial 299,959 01.01.2011 

HS(M) 17482 & 17483 (4,881.9 Sq m) 

(Old HS(M) 15205 PTD 

63981) Mukim Kluang 

Daerah Kluang, Johor 

16 Lot 1310 Geran 171, Freehold 2.01 hectares Agricultural 896,822 31.12.2011 

Mukim Melaka Pindah, 

District of Alor Gajah, 

Melaka






17 Lot 989 Mukim 111, Lot Freehold 11.9388 hectares Agricultural 5,868,535 31.12.2012 

990 Geran 10252 & Lot 

1560 Mukim 205, Mukim 

of Pegoh, Daerah Aloh 

Gajah, Melaka 

18 PT 8183 to 8224, HS(D) Freehold 6,488 sq. m Commercial 2,040,568 31.12.2012 

No. 64130 to 64171 , (69,836.44 sq ft) 

Mukim Cheng, Dearah 

Melaka Tengah, Melaka 

19 Lot 259, GM 105, Mukim Freehold 0.6956 hectare Industrial 2,074,880 01.01.2011 

Tebrau, Dearah Johor (1A.2R.35P) 

Bahru, Johor 

20 Lot No. 2066, Mukim Leasehold for 763,722 sq ft Mixed 14,595,213 24.06.2010 

of Tangga Batu, District 99 years Development 

of Melaka Tengah, expiring on 

Melaka 19.09.2095. It 

has an unexpired 


approximately 

83 years 

21 Lot 2922, GM 257, Freehold 1.892 hectares Agricultural 8,429,660 31.12.2012 

Mukim of Tebrau, 

District of Johor Bahru, 

Johor 

22 Lot 44572, GM 726, Freehold 0.7874 hectare Agricultural 3,299,081 31.12.2012 

Mukim of Tebrau, 

District of Johor Bahru, 

Johor 

23 Lot 2920, GM 1514, Freehold 82,219.50 Sq ft Agricultural 2,926,761 31.12.2012 

Mukim of Tebrau, District 

of Johor Bahru, Johor 

01 71 


72 


[ This page has been intentionally left blank. ]

GROMUTUAL BERHAD (Company No. 625034-X) 

FORM OF PROXY CDS Account No. of Authorised Nominee# 

#applicable to shares held through nominee account 

I/We NRIC No./Passport No./Company No 

of 

being a member/members of GROMUTUAL BERHAD (Company No. 625034-X), hereby appoint 

NRIC No./Passport No. 


or failing him/her NRIC No./Passport No. 


or failing him/her/them, the Chairman of the Meeting as *my/our proxy to vote for *me/us on *my/our behalf at the 10th Annual General 

Meeting of the Company to be held at Dewan Johor, 2nd Floor, Mutiara Johor Bahru, Jalan Dato Sulaiman, Taman Century, 80250 Johor 

Bahru, Johor Darul Takzim, Malaysia on Monday, 27 May 2013 at 10.00 a.m. and any adjourment thereof and my/our proxy is to vote as 

indicated below : 

ITEM AGENDA 

1. To receive the Audited Financial Statements for the financial year ended 31 December 2012 and the Reports of the 

Directors and Auditors thereon. 

ORDINARY BUSINESS: 

2. To declare and approve the payment of a Single Tier Final Dividend of 1%, in respect of 

the financial year ended 31 December 2012. 

3. To approve the payment of Directors’ fee of RM184,000 for the financial year ended 

31 December 2012. 

4. To re-elect the following Directors who retire by rotation pursuant to Article 84 

of the Company’s Articles of Association. 

4.1 Ms. Chew Kwee Hiok 


4.3 Encik Azahar Bin Baharudin 

5. To re-appoint Messrs. Deloitte KassimChan as Auditors of the Company and 

to authorise the Directors to fix their remuneration. 

SPECIAL BUSINESS : 

6. Authority to Directors to issue and allot shares pursuant to Section 132D of the 

Companies Act, 1965 

7. Continuing in office for the following Directors as Independent Non-Executive Directors. 

7.1 YH Dato’ Chong Keap Thai @ Cheong Keap Tai 


8. Proposed Amendments to the Articles of Association of the Company 

RESOLUTION FOR AGAINST 

Please indicate with an “X” in the appropriate space how you wish your proxy to vote. If you do not indicate how you wish your proxy to vote 

on any resolution, the proxy shall vote as he/she thinks fit or, at his/her discretion or, abstain from voting. 

Dated this……………………………..day of…………………………………2013 

Number of shares held 

……………………………………… 

Signature(s) / Common Seal of Shareholder(s) 

*Delete if not applicable 

NOTES:- 

1. A member of the Company entitled to attend and vote at the meeting may appoint a proxy or proxies (but not more than two (2)) to attend and vote 

in his/her stead. A proxy may but need not be a member of the Company. 

2. A member of the Company who is an authorised nominee as defined under the Securities Industry (Central Depositories) Act, 1991 is allowed to 

appoint at least one (1) proxy in respect of each securities account it holds with ordinary shares of the Company standing to the credit of the said 

securities account. 

3. Where a member of the Company is an exempt authorised nominee as defined under the Securities Industry (Central Depositories) Act, 1991, which 

holds ordinary shares in the Company for multiple beneficial owners in one (1) securities account (“omnibus account”), there is no limit to the number 

of proxies which the exempt authorised nominee may appoint in respect of each omnibus account it holds. 

4. Where a member appoints two (2) proxies or where an exempt authorised nominee appoints two (2) or more proxies, the appointments shall be 

invalid unless he/she specifies the proportion of his/her holdings to be represented by each proxy. 

5. The instrument appointing a proxy, in the case of an individual shall be signed by the appointor or his/her attorney duly authorised in writing and in 

the case of a corporation, either under seal or under the hand of an officer or attorney duly authorised. If no name is inserted in the space for the 

name of your proxy, the Chairman of the Meeting will act as your proxy. 

6. The instrument appointing a proxy must be deposited at the Registered Office of the Company situated at Suite 1301, 13th Floor, City Plaza, Jalan 

Tebrau, 80300 Johor Bahru, Johor Darul Takzim, Malaysia not less than 48 hours before the time appointed for holding the meeting or any adjournment 

thereof. 

7. Only members whose names appear on the Record of Depositors as at 20 May 2013 will be entitled to attend this meeting. 

1 

2 

3 

4 

5 

6 

7 

8 

9 

10 

For appointment of two proxies, number of shares and 

percentage of shareholdings to be represented by the proxies : 

Proxy 1 

Proxy 2 

No. of shares Percentage 

% 

%

Fold this flap for sealing 

2nd fold here 

3rd fold here 

The Company Secretary 

GROMUTUAL BERHAD (625034-X) 

Suite 1301, 13th Floor, City Plaza, 

Jalan Tebrau, 

80300 Johor Bahru, 

Johor Darul Takzim, 

Malaysia 

AFFIX 

STAMP 

HERE

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