Osim FR 050407.indd

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Notes to the Financial Statements - 31 December 2006 (cont’d)42. Financial risk management objectives and policies (cont’d)d) Credit riskCredit risk, or the risk of counterparties defaulting, is managed through the application of credit approvals, credit limits andmonitoring procedures.The carrying amount of cash and cash equivalents, trade debtors and other debtors represent the Group’s maximum exposureto credit risk in relation to fi nancial assets. No other fi nancial assets carry a signifi cant exposure to credit risk.As the nature of the Group’s business is in retail, the majority of outstanding trade receivables are due from department storesand fi nancial institutions.43. Financial instrumentsa) Credit riskThere are no signifi cant concentrations of credit risk within the Group or the Company.b) Fair valuesFair value is defi ned as the amount at which the fi nancial instrument could be exchanged in a current transaction betweenknowledgeable willing parties in an arm’s length transaction, other than in a forced or liquidation sale.The following methods and assumptions are used to estimate the fair value of each class of fi nancial instruments:• Cash and cash equivalents and other current financial assets and liabilitiesThe carrying amounts approximate fair values due to the relatively short-term maturity of these instruments.• Short-term borrowingsThe carrying amount approximates fair value because of the short period to maturity.• Long-term borrowingsThe fair values of the long-term bank loans are based on the quoted market price for the same or similar issues or onthe current rates available for debt with the same maturity profi le. The fair value of non-current loans, borrowings orother payables with variable interest rates approximates their carrying amounts.• Long-term receivablesThe fair value of long-term receivables is determined by discounting estimated cash fl ows using current marketincremental lending rates for similar types of lending.Notes to the Financial Statements 163Annual Report 2006
Notes to the Financial Statements - 31 December 2006 (cont’d)43. Financial instruments (cont’d)b) Fair values (cont’d)• Lease obligationsThe fair value of lease obligations is determined by discounting the relevant cash fl ows using current interest rates forsimilar instruments at balance sheet date.• Forward currency contractsThe fair value of forward currency contracts is determined by reference to current forward exchange rates for contractswith similar maturity profi les.As at 31 December 2006, the fair values of fi nancial assets and liabilities which do not approximate the carrying amount in thebalance sheets of the Group and the Company are presented in the following table:Carryingamount2006 2005Estimatedfair valueCarryingamountEstimated fairvalue$’000 $’000 $’000 $’000GroupFinancial assets:Long-term investment in equity shares (unquoted) 930 (i) – –Long-term receivables 10,619 11,046 7,618 7,923Financial liabilities:Obligations under fi nance leases 2,313 1,188 4,702 4,293CompanyFinancial assets:Long-term investment in equity shares (unquoted) 930 (i) – –Long-term receivables 1,915 1,994 1,545 1,607(i) It is not practicable to determine with suffi cient reliability, the fair value of the unquoted equity shares held as long-terminvestments as they do not have quoted market prices in an active market, nor are other methods of reasonable estimating thefair values readily available.Notes to the Financial Statements 164Annual Report 2006
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Process and Performanceas the growt
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Customer Service Department“I put
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Sales Department“I look forward t
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Research & Development“Every prod
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Contents17 CEO’s Message22 The Ro
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... ensuring that as we grow,they g
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previous year. Q4 2006 revenue rose
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The Role ModelsThe Role Models 22 A
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Ms Teo Sway HeongNon-Executive Dire
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Mr Peter Lee Hwai KiatMs Celine Cha
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Result of our Growth StrategyThe Gr
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Performance ReviewIn building a glo
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ProfitabilityIn FY2006, buoyant rev
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An Environment of GrowthMarch 2006
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Financial HighlightsOur goal is to
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Number of OutletsOSIM OutletsNorth
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Capital ExpenditureCapexS$’000 Le
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Corporate Structure as at 21 Februa
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OSIM Global NetworkSINGAPORECHINATA
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Corporate InformationBoard of Direc
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Non Executive DirectorMs Teo Sway H
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Corporate Governance Report 51 Annu
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The Company worked closely with a p
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New directors are at present appoin
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In 2006, the Audit & Risk Managemen
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The aggregate value of interested p
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Financial Contents64 Directors’ R
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Directors’ ReportFor the Year end
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Directors’ Report (cont’d)Share
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Directors’ Report (cont’d)Share
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Directors’ Report (cont’d)Audit
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Independent Auditors’ Reportto th
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Balance Sheetsas at 31 December 200
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Consolidated Profit and Loss Accoun
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Statements of Changes in Equity for
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Consolidated Cash Flow Statementfor
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Consolidated Cash Flow Statement fo
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Notes to the Financial Statements -
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Page 113 and 114: Notes to the Financial Statements -
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Page 171 and 172: Major PropertiesUnexpiredterm ofDes
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Page 175 and 176: Notice of Annual General Meeting (c
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Page 179 and 180: Appendix (cont’d)DEFINITIONSIn th
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Page 187 and 188: Appendix (cont’d)11. ACTION TO BE
Page 189 and 190: OSIM INTERNATIONAL LTDCompany Regis
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Osim FR 050407.indd

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