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4. CHANGES IN ACCOUNTING POLICIES (continued) (a) Standards issued but not yet effective (continued) Pronouncements effective for financial periods beginning on or after 1 January 2010: (continued) FRS 3: Business Combinations (revised) and FRS 127: Consolidated and Separate Financial Statements (amended) FRS 3 (revised) introduces a number of changes to the accounting for business combinations occurring on or after 1 July 2010. These include changes that affect the valuation of non-controlling interest, the accounting for transaction costs, the initial recognition and subsequent measurement of a contingent consideration and business combinations achieved in stages. These changes will impact the amount of goodwill recognised, the reported results in the period that an acquisition occurs and future reported results. FRS 127 (amended) requires that a change in the ownership interest of a subsidiary (without loss of control) is accounted for as a transaction with owners in their capacity as owners and to be recorded in equity. Therefore, such transaction will no longer give rise to goodwill, nor will it give rise to a gain or loss. Furthermore, the amended Standard changes the accounting for losses incurred by the subsidiary as well as loss of control of a subsidiary. The changes by FRS 3 (revised) and FRS 127 (amended) will be applied prospectively and only affect future acquisition or loss of control of subsidiaries and transactions with non-controlling interests. Amendments to FRS 2: Share-based Payment This amendment clarifies that an entity shall not apply this FRS to transactions in which the entity acquires goods as part of the net assets acquired in a business combination, in a combination of entities or business under common control, or the contribution of a business on the formation of a joint venture as defined by FRS 131 Interests in Joint Ventures. Amendments to FRS 138: Intangible Assets The amendments clarify that an intangible asset must be recognised separately from goodwill even if it is separable only together with a related contract, identifiable asset, or liability. Also, if an intangible asset is separable only together with another intangible asset, those assets can be recognised together as a single asset, and if the individual assets in a group of complementary intangible assets have similar useful lives, those assets can be recognised together as a single asset. IC Interpretation 16: Hedges of a Net Investment in a Foreign Operation This Interpretation provides guidance on identifying foreign currency risks and hedging instruments that qualify for hedge accounting in the hedge of a net investment in a foreign operation. It also explains how an entity should determine the amounts to be reclassified from equity to profit or loss for both the hedging instrument and the hedged item. As the Group currently has no hedge of a net investment in a foreign operation, the adoption of the Interpretation is not expected to have any impact on the financial position or results of the Group. 60
5. CRITICAL ACCOUNTING JUDGEMENTS AND KEY SOURCES OF ESTIMATION UNCERTAINTY In the application of the Group’s accounting policies, which are described in Note 3, 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 if the version affects only that period, or in the period of the revision and future periods if the version affects both current and future periods. Critical Accounting Estimates and Assumptions The following are the key assumptions concerning the future, and other key sources of estimation uncertainty at the balance sheet date, that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year: (i) Depreciation of Property, Plant and Equipment The cost of the plant and machinery relating to manufacturing of hot rolled coils and cold rolled coils is depreciated on a straight-line basis over the assets’ useful lives. Management estimates the useful lives of these plant and machinery to be within 15 years to 30 years and residual value to be 5%. Changes in the expected level of usage and technological developments could impact the economic useful lives and the residual values of these assets, which may cause a material adjustment to future depreciation charges. (ii) Estimated Impairment of Goodwill The Group determines whether goodwill is impaired at least on an annual basis. This requires an estimation on the value-in-use of the cash-generating units (“CGU”) to which goodwill is allocated. Estimating a valuein-use amount requires management to make an estimate of the expected future cash flows of the CGU and also to choose a suitable discount rate in order to calculate the present value of those cash flows. (iii) Estimated Impairment of Tangible Assets When there is an indication that the carrying amount of an asset may be impaired, the asset’s recoverable amount, being the higher of its fair value less costs to sell and its value-in-use, will be assessed. The assessment of recoverable amount involves various methodologies. Fair value of an asset is estimated by reference to net assets of the investee or based on prevailing market value determined by professional valuers. In determining the value-in-use of an asset, being the future economic benefits to be expected from its continued use and ultimate disposal, the Group makes estimates and assumptions that require significant judgements and estimates. While the Group believes these estimates and assumptions to be reasonable and appropriate, changes in these estimates and assumptions of value-in-use could impact on the Group’s financial position and results. (iv) Deferred Tax Assets Deferred tax assets are recognised for all unused tax losses and unabsorbed capital allowances to the extent that it is probable that taxable profit will be available against which the losses and capital allowances can be utilised. Significant management judgement is required to determine the amount of deferred tax assets that can be recognised, based upon the likely timing and level of future taxable profits together with future tax planning strategies. Details of deferred tax assets are disclosed in Note 22. (v) Inventories Significant judgement is required in determining the quality, grades and density of the raw materials existing at the end of the financial year. In forming judgement, the Group relies on past experience and on the work of an expert in measuring the raw materials. Details of inventories are disclosed in Note 23. 61
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CONTENTS Page Notice of Meeting 1 C
Page 4 and 5:
6.1.2 Proposed Shareholders’ Mand
Page 6 and 7:
CORPORATE INFORMATION Board of Dire
Page 8 and 9:
Tan Sri Cheng Yong Kim Non-Independ
Page 10 and 11:
Folk Fong Shing @ Kok Fong Hing Ind
Page 12 and 13: Supply of Information The Board as
Page 14 and 15: 3. RELATIONS WITH SHAREHOLDERS AND
Page 16 and 17: AUDIT COMMITTEE REPORT COMPOSITION
Page 18 and 19: ACTIVITIES DURING THE FINANCIAL YEA
Page 20 and 21: NOMINATION COMMITTEE Chairman : Mr
Page 22 and 23: THE GROUP’S BUSINESSES • Aerial
Page 24 and 25: sebanyak 25%. Kesan positif pengumu
Page 26 and 27: CHAIRMAN’S STATEMENT On behalf of
Page 28 and 29: 主席报告我谨代表董事部,
Page 30 and 31: FINANCIAL STATEMENTS 2010 For The F
Page 32 and 33: DIRECTORS’ INTERESTS (continued)
Page 34 and 35: OTHER STATUTORY INFORMATION Before
Page 36 and 37: INCOME STATEMENTS FOR THE FINANCIAL
Page 38 and 39: BALANCE SHEETS (continued) AS AT 30
Page 40 and 41: Group STATEMENTS OF CHANGES IN EQUI
Page 42 and 43: CASH FLOW STATEMENTS FOR THE FINANC
Page 44 and 45: NOTES TO THE FINANCIAL STATEMENTS 3
Page 46 and 47: 3. SIGNIFICANT ACCOUNTING POLICIES
Page 58 and 59: 4. CHANGES IN ACCOUNTING POLICIES (
Page 60 and 61: 4. CHANGES IN ACCOUNTING POLICIES (
Page 64 and 65: 5. CRITICAL ACCOUNTING JUDGEMENTS A
Page 66 and 67: 9. PROFIT/(LOSS) FROM OPERATIONS Th
Page 68 and 69: 11. OVER PROVISION FOR LOSS Pursuan
Page 70 and 71: 14. PROPERTY, PLANT AND EQUIPMENT F
Page 72 and 73: 14. PROPERTY, PLANT AND EQUIPMENT (
Page 74 and 75: 14. PROPERTY, PLANT AND EQUIPMENT (
Page 76 and 77: 18. INVESTMENT IN SUBSIDIARIES 74 C
Page 78 and 79: 18. INVESTMENT IN SUBSIDIARIES (con
Page 80 and 81: 18. INVESTMENT IN SUBSIDIARIES (con
Page 82 and 83: 19. INVESTMENT IN ASSOCIATES Group
Page 84 and 85: 20. OTHER INVESTMENTS Long Term Inv
Page 86 and 87: 21. TRADE AND OTHER RECEIVABLES Gro
Page 88 and 89: 22. DEFERRED TAXATION (continued) D
Page 90 and 91: 26. NON-CURRENT ASSETS CLASSIFIED A
Page 92 and 93: 29. PREFERENCE SHARES Megasteel iss
Page 94 and 95: 29. PREFERENCE SHARES (continued) T
Page 96 and 97: 30. BORROWINGS (continued) The weig
Page 98 and 99: 30. BORROWINGS (continued) (A) Synd
Page 100 and 101: 31. REDEEMABLE CONVERTIBLE SECURED
Page 102 and 103: 32. BONDS AND DEBTS Group Company 2
Page 104 and 105: 32. BONDS AND DEBTS (continued) (A)
Page 106 and 107: 33. DEFERRED LIABILITIES 104 Group
Page 108 and 109: 36. EMPLOYEE BENEFITS (a) Defined B
Page 110 and 111: 36. EMPLOYEE BENEFITS (continued) (
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39. RELATED PARTY TRANSACTIONS Rela
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40. SEGMENTAL ANALYSIS (continued)
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40. SEGMENTAL ANALYSIS (continued)
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42. FINANCIAL INSTRUMENTS Financial
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42. FINANCIAL INSTRUMENTS (continue
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INDEPENDENT AUDITORS’ REPORT TO T
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LIST OF GROUP PROPERTIES AS AT 30 J
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Thirty Largest Registered Sharehold
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Thirty Largest Registered Warrant H
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OTHER INFORMATION (I) MATERIAL CONT
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(IV) STATUS OF CONDITIONS IMPOSED B
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✄ FORM OF PROXY CDS ACCOUNT NUMBE
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