Annual Report 2007 - Hmdatalink.com hm datalink

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Directors’ ReportSave as disclosed above, at no time during the yeardid the directors, their associates, or shareholdersof the Company, which to the knowledge of thedirectors own more than 5% of the Company’s sharecapital, have an interest in any of the Group’s fivelargest customers or suppliers.Corporate Governance ReportDetails of the Corporate Governance Report are setout on pages 37 to 46 of the annual report.Audit CommitteeThe Company has an audit committee which wasestablished in accordance with the requirementsof the Corporate Governance Code as defined inthe Listing Rules for the purpose of reviewing andproviding supervision over the Group’s financialreporting processes and internal controls. Theaudit committee comprises Messrs. Lee Cheuk Yin,Dannis, Song Lin and Yeung Sau Hung, Alex whoare the independent non-executive directors of theCompany.Sufficiency of Public FloatRule 8.08 of the Listing Rules requires at least 25% ofthe issued share capital of the Company to be heldin public hands. Based on the information availableand within the knowledge of the directors as at thedate of issue of the annual report, such obligationhas been complied with.Zhejiang Geely Holding Group Company Limited,which is ultimately owned by Mr. Li Shu Fu (“Mr. Li”),the Company’s Chairman, and his associates, hassigned agreements or been in negotiations with localgovernments in the PRC to set up production plantsfor the manufacturing and distribution of Geelysedans in three locations, namely Lanzhou, Cixi andJinan. The potential production and distribution ofGeely sedans in these three locations by ZhejiangGeely Holding Group Company Limited willconstitute competing businesses (the “CompetingBusinesses”) to those currently engaged by theCompany’s associates. Mr. Li has undertaken tothe Company (the “Undertaking”) that upon beingnotified of any decision by the Company pursuantto a resolution approved by a majority of theindependent non-executive Directors, he will, andwill procure his associates (other than the Group) tosell to the Group all of the Competing Businessesand related assets, subject to compliance withapplicable requirements of the Listing Rules andother applicable laws and regulations upon terms tobe mutually agreed as fair and reasonable.AuditorsA resolution will be submitted to the annual generalmeeting to re-appoint Messrs. Grant Thornton as theauditors of the Company.On behalf of the BoardCompeting BusinessesThe Group is principally engaged in the research,production, marketing and sales of sedans andrelated automobile components in the PRC.Li Shu FuChairman16 April 2008GEELY AUTOMOBILE HOLDINGS LIMITED55ANNUAL REPORT 2 0 0 7
Independent Auditors’ ReportTo the members ofGeely Automobile Holdings Limited(incorporated in the Cayman Islands with limited liability)We have audited the consolidated financialstatements of Geely Automobile Holdings Limited(the “Company”) and its subsidiaries (collectivelyreferred to as the “Group”) set out on pages 58to 111, which comprise the consolidated balancesheet as at 31 December 2007, and the consolidatedincome statement, the consolidated statement ofchanges in equity and the consolidated cash flowstatement for the year then ended, and a summary ofsignificant accounting policies and other explanatorynotes.Directors’ responsibility for theconsolidated financial statementsThe directors of the Company are responsible forthe preparation and the true and fair presentationof these consolidated financial statements inaccordance with Hong Kong Financial ReportingStandards issued by the Hong Kong Institute ofCertified Public Accountants and the disclosurerequirements of the Hong Kong CompaniesOrdinance. This responsibility includes designing,implementing and maintaining internal controlrelevant to the preparation and the true and fairpresentation of consolidated financial statementsthat are free from material misstatement, whetherGEELY AUTOMOBILE HOLDINGS LIMITEDdue to fraud or error; selecting and applyingappropriate accounting policies; and makingaccounting estimates that are reasonable in thecircumstances.Auditors’ responsibilityOur responsibility is to express an opinion on theseconsolidated financial statements based on ouraudit and to report our opinion solely to you, as abody, and for no other purpose. We do not assumeresponsibility towards or accept liability to any otherperson for the contents of this report. We conductedour audit in accordance with Hong Kong Standardson Auditing issued by the Hong Kong Instituteof Certified Public Accountants. Those standardsrequire that we comply with ethical requirementsand plan and perform the audit to obtain reasonableassurance as to whether the consolidated financialstatements are free from material misstatement.An audit involves performing procedures to obtainaudit evidence about the amounts and disclosuresin the consolidated financial statements. Theprocedures selected depend on the auditors’judgement, including the assessment of the risks ofmaterial misstatement of the consolidated financialstatements, whether due to fraud or error. In makingthose risk assessments, the auditors consider internalcontrol relevant to the entity’s preparation and trueand fair presentation of the consolidated financialstatements in order to design audit proceduresthat are appropriate in the circumstances, but not56ANNUAL REPORT 2 0 0 7
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Supplying the SAFEST, the MOST ENER
Page 5 and 6: Financial Summary and HighlightsFin
Page 8 and 9: Chairman’s StatementLi Shu Fu,Cha
Page 10 and 11: Chairman’s Statementoperating ass
Page 12 and 13: Management Discussion and AnalysisO
Page 14 and 15: Organisation Chart (as of 31 Decemb
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Page 38 and 39: Corporate Governance ReportThe Comp
Page 40 and 41: Corporate Governance ReportRelation
Page 42 and 43: Corporate Governance ReportEach new
Page 44 and 45: Corporate Governance Reportthe appo
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Page 48 and 49: Directors’ ReportThe Directors pr
Page 50 and 51: Directors’ ReportCompanies contai
Page 52 and 53: Directors’ Report(5) Hunan Geely
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Page 58 and 59: Independent Auditors’ Reportfor t
Page 60 and 61: Consolidated balance sheetas at 31
Page 62 and 63: Consolidated cash flow statementfor
Page 64 and 65: Notes to the consolidated financial
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Notes to the consolidated financial
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Geely Automobile Holdings LimitedRo
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