ACOCTEC-AnnualReport2009 (1.3MB)

annual report 2009
02 05
notice of annual general meeting statement accompanying notice of annual general meeting financial highlights group structure corporate information chairmans statement profile of directors corporate social responsibility audit committee report corporate governance statement other information statement of internal control financial statements analysis of shareholdings list of properties
08 09 10 12 16 20 24 27 32 33 35 99 101
proxy form
contents
Notice Of Annual General Meeting
NOTICE IS HEREBY GIVEN that the Tenth Annual General Meeting of the Company will be held at Crystal Room, Level 1, Crystal Crown Hotel Harbour View, 217 Persiaran Raja Muda Musa, 42000 Port Klang, Selangor Darul Ehsan on Thursday, 17 September 2009 at 10:30 a.m. for the following purposes:
1. To receive the Audited Financial Statements for the financial year ended 31 March 2009 and the Reports of the Directors and the Auditors thereon.
(Please refer to Note No. 2)
2.
To approve the payment of Directors Fees in respect of the financial year ended 31 March 2009. Ordinary Resolution 1 To re-elect the following Directors retiring in accordance with Article 103 of the Articles of Association of the Company: (a) Mr Su Cheng Tao (b) Mr Chang Song Hai (c) Mr Huang Huai-Son
Ordinary Resolution 2 Ordinary Resolution 3 Ordinary Resolution 4
3.
4.
To re-appoint Messrs BDO Binder as the Auditors of the Company for the ensuing year and to authorise the Directors to fix their remuneration.
Ordinary Resolution 5
As Special Business To consider and if thought fit, to pass the following resolutions: 5. Authority to Allot and Issue Shares Pursuant to Section 132D of the Companies Act, 1965 THAT pursuant to Section 132D of the Companies Act, 1965 and approvals from Bursa Malaysia for the listing of and quotation for the additional shares so issued and other relevant authorities, where approval is necessary, authority be and is hereby given to the Directors to allot and issue shares in the Company at any time upon such terms and conditions and for such purposes as the Directors may in their absolute discretion deem fit provided always that the aggregate number of shares to be issued shall not exceed 10% of the issued share capital of the Company at any point of time AND THAT such authority shall continue to be in force until the conclusion of the next Annual General Meeting of the Company. Ordinary Resolution 6
Acoustech Berhad (496665-W)
Notice Of Annual General Meeting (Cont`d)
6.
Proposed Renewal of Shareholders Mandate for Recurrent Related Party Transactions of a Revenue or Trading Nature THAT approval be and is hereby given for the renewal of the Shareholders Mandate for the Acoustech Berhad Group of Companies to enter into any category of recurrent transactions of a revenue or trading nature falling within the types of transactions as set out in Section 3.3 in the Circular to Shareholders dated 25 August 2009 with the related parties falling within the classes of persons set out in Section 3.2 in the Circular which are necessary for day-to-day operations and are carried out in the ordinary course of business on terms which are not more favorable to the related parties than those generally available to the public and are not to the detriment of minority shareholders; AND THAT the authority conferred by such mandate shall commence upon the passing of this resolution and continue to be in force until;(a) the conclusion of the next Annual General Meeting (AGM) of the Company at which time the mandate will lapse, unless by a resolution passed at the next AGM, the mandate is renewed; or (b) the expiration of the period within which the next AGM of the Company is required to be held pursuant to Section 143(1) of the Act (but must not extend to such extension as may be allowed pursuant to Section 143(2) of the Act); or (c) revoked or varied by resolution passed by the shareholders in general meeting. whichever is earlier; AND THAT the Directors be and are hereby authorised to complete and do all such acts and things including executing such documents as may be required to give effect to the transactions contemplated and/or authorised by this mandate. Ordinary Resolution 7
7.
Authority to Allot and Issue Shares Pursuant to the Employees Share Option Scheme THAT pursuant to the Acoustech Berhad Employees Share Option Scheme (the Scheme) which was approved at the Extraordinary General Meeting held on 23 September 2004, approval be and is hereby given to the Directors to offer and grant options to eligible employees and eligible Directors of the Company and its subsidiary companies (the Group) and pursuant to Section 132D of the Companies, Act, 1965 to allot and issue such number of new ordinary shares of RM0.50 each in the capital of the Company from time to time in accordance with the By-Laws of the Scheme. Ordinary Resolution 8
8.
Proposed Renewal of the Authority for Share Buy-Back THAT, subject to the Companies Act, 1965 (Act), the Listing Requirements of Bursa Malaysia Securities Berhad and the approval of all relevant governmental and/or regulatory authorities, the Company be and is authorized to purchase such number of ordinary shares of RM0.50 each in the Company (Proposed Renewal of Share Buy Back) as may be determined by the Board from time to time on Bursa Malaysia Securities Berhad upon such terms conditions as the Board may deem fit and expedient in the interest of the Company provided that the aggregate number of shares purchased pursuant to this resolution does not exceed ten percent (10%) of the issued and paid-up share capital of the Company which amount to 177,319,200 ordinary shares of RM0.50 each as at 24 July 2009 and an amount not exceeding the total retained earnings of RM18,047,965 and share premium account of RM7,266,493 based on the latest audited accounts of the Company as at 31 March 2009, be allocated by the Company for the Proposed Renewal Share Buy-Back. THAT such authority shall commence upon the passing of this resolution and shall remain in force until the conclusion of the next Annual General Meeting (AGM) of the Company unless earlier revoked or varied by ordinary resolution of the shareholders of the Company in general meeting. THAT authority be and is hereby given to the Directors of the Company to decide in their discretion to retain the ordinary shares in the Company so purchased by the Company as treasury shares and/or cancel them and/or resell the treasury shares or distribute them as share dividend and/or subsequently cancel them. AND THAT authority be and is hereby given to the Directors of the Company to take all such steps as are necessary (including executing all such documents as may be required) and to enter into any agreements and arrangements with any party or parties to implement, finalise and give full effect to the aforesaid with full powers to assent to any conditions, modifications, variations and/or amendments (if any) as may be imposed by the relevant authorities and to do all such acts and things as the Directors may deem fit and expedient in the interest of the Company. Ordinary Resolution 9
9.
To transact any other business of the Company of which due notice shall have been given.
By Order of the Board
LIM HOOI MOOI (MAICSA 0799764) TAN ENK PURN (MAICSA 7045521) Joint Company Secretaries Kuala Lumpur 25 August 2009
NOTES 1. Appointment of Proxy A Member of the Company entitled to attend and vote at the meeting may appoint a proxy to attend and vote instead of him. A member of the Company who is an authorised nominee as defined under the Securities Industry (Central Depositories) Act 1991 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. A proxy need not be a member of the Company. The instrument appointing a proxy shall be in writing under the hand of the appointer or his attorney duly authorised in writing, or if the appointer is a corporation, either under its common seal or in some other manner approved by its Directors. The instrument of proxy must be deposited at the Companys Registered Office at Level 18, The Gardens North Tower, Mid Valley City, Lingkaran Syed Putra, 59200 Kuala Lumpur atleast forty-eight hours before the time appointed for holding the meeting.
2.
Agenda No. 1 This item of the Agenda is meant for discussion only. The provisions of Section 169 of the Companies Act, 1965 require that the audited financial statements and the Reports of the Directors and Auditors thereon be laid before the Company at its Annual General Meeting. As such this Agenda item is not a business which requires a resolution to be put to vote by shareholders.
3.
Explanatory Notes on Special Businesses Ordinary Resolution No. 6 The proposed Ordinary Resolution No. 6, if passed, will avoid any delay and cost involved in convening a general meeting and will empower the Directors to allot and issue shares in the Company up to an amount not exceeding in aggregate 10% of the issued share capital of the Company for the time being. This authority unless revoked or varied at a general meeting will expire at the next Annual General Meeting of the Company. The Director did not allot nor issue any shares under the same mandate granted last year. Nevertheless a renewal for the said mandate is sought to avoid any delay and cost involved in convening such a general meeting. The Directors would utilize the proceeds raised from this mandate for working capital or such other applications they may in their absolute discretion deem fit. Ordinary Resolution No. 7 For further information, please refer to the Circular to Shareholders dated 25 August 2009 accompanying the Companys Annual Report for the financial year ended 31 March 2009. Ordinary Resolution No. 8 The proposed Ordinary Resolution No. 8 is to empower the Directors to allot and issue ordinary shares from the unissued share capital of the Company pursuant to Acoustech Berhads Employees Share Option Scheme. Ordinary Resolution No. 9 The proposed Ordinary Resolution No. 9, if passed will empower the Directors of the Company to purchase up to 10% of the issued and paid-up share capital of the Company (Proposed Renewal Share Buy-Back) by utilizing the funds allocated which shall not exceed the retained profits of the Company and share premium account. This authority, unless revoked or varied at a general meeting will expire at the conclusion of the next Annual General Meeting of the Company.
Statement Accompanying Notice Of Annual General Meeting

1. Directors standing for election There is no person seeking election as Director of the company at this Annual General Meeting
Clarity in Vision
Determines Majestic Ambition
Financial Highlights
For The Financial Year Ended 31 March
314,492,331
339,947,519
301,927,419
279,939,456
24,469,259
22,767,812
227,658,813
22,335,335
20,080,505
05
06
07
08
09
05
06
07
08
09
Revenue (RM)
Profit Before Taxation (RM)
11,624,154
Group Structure

(Incorporated in Malaysia under the Companies Act, 1965)
100%
Formosa Prosonic Technics Sdn Bhd
58.19%
Aerotronic Sdn Bhd
100%
Formosa Prosonic Chemicals Sdn Bhd
75%
Formosa Prosonic Equipment Sdn Bhd
50%
Elkay Pacific Rim (Malaysia) Sdn Bhd
Corporate Information
10
BOARD OF DIRECTORS Chang Song Hai Chairman,Non-Independent Non-Executive Director Su Cheng Tao Managing Director Dato Nik Abdul Aziz Bin Mohamed Kamil Independent Non-Executive Director Chen Po Hsiung Executive Director Huang Huai Son Executive Director Leong Ngai Seng Independent Non-Executive Director Shih Chao Yuan Non-Independent Non-Executive Director Soon Kwai Choy Independent Non-Executive Director
AUDIT COMMITTEE Soon Kwai Choy

Chairman, Independent Non-Executive Director
Dato Nik Abdul Aziz Bin Mohamed Kamil

Independent Non-Executive Director
Leong Ngai Seng

OPTION COMMITTEE Su Cheng Tao

Managing Director
Chen Po Hsiung
Executive Director
NOMINATION COMMITTEE Chang Song Hai Chairman, Non-Independent Non-Executive Director Leong Ngai Seng Independent Non-Executive Director Soon Kwai Choy
Corporate Information (Cont`d)
11
REMUNERATION COMMITTEE Chang Song Hai Chairman, Non-Independent Non-Executive Director Leong Ngai Seng
SHARE REGISTRAR Symphony Share Registrars Sdn Bhd Level 26, Menara Multi-Purpose Capital Square No.8, Jalan Munshi Abdullah 50100 Kuala Lumpur Tel : 03-2721 2222 Fax : 03-2721 2530
Dato Nik Abdul Aziz Bin Mohamed Kamil

PRINCIPAL PLACE OF BUSINESS COMPANY SECRETARIES Lim Hooi Mooi MAICSA 0799764 Tan Enk Purn MAICSA 7045521 No.2, Jalan 1 Bandar Sultan Suleiman Taiwanese Industrial Park 42000 Port Klang Selangor Darul Ehsan Tel : 03-3176 1145 Fax : 03-3176 2003
AUDITORS BDO Binder (AF : 0206) Chartered Accountants 12th Floor, Menara Uni.Asia 1008 Jalan Sultan Ismail 50250 Kuala Lumpur PRINCIPAL BANKERS RHB Bank Berhad Malayan Banking Berhad CIMB Bank Berhad Standard Chartered Bank Malaysia Berhad Citibank Berhad
REGISTERED OFFICE Level 18, The Gardens North Tower Mid Valley City Lingkaran Syed Putra 59200 Kuala Lumpur Tel : 03-2264 8888 Fax : 03-2282 2733 STOCK EXCHANGE LISTING Main Market of Bursa Malaysia Securities Berhad
WEBSITE www.acoustech.com.my
Chairmans Statement
12
Dear shareholders, On behalf of the Board of Directors of Acoustech Berhad, I am pleased to present to you the Annual Report and Audited Financial Statements of the Group and the Company for the fiscal year ended 31 March 2009.
The world is suffering a contraction on economic activities as a result of the global credit crisis which in turn has impacted most of our customers negatively. This environment has impeded our top line performance, especially in the second half of the fiscal year, where some of our major customers began to cutback their orders. As a result, the Group incurred operating losses in the second half of the fiscal year 2009. Fiscal year 2009 was a tough year. Our primary focus had been to manage the challenges. The Groups sales dropped by 18% to RM280 million from the previous fiscal years RM340 million. Notwithstanding that, all divisions namely the audio, the chemical paints and the electrical equipment division registered operating profits. The Group worked hard to strive for profitability despite the tough times.
THE YEAR IN REVIEW Sales and operating profit contributions by division are as follow: FY2009 FY2008 RM mil % RM mil % Sales: Audio Electrical equipment Chemical paints
185.7 61.2 33.0 279.9
66.3 21.9 11.8 100.0
204.9 89.2 45.8 339.9
60.3 26.2 13.5 100.0
Operating profit: Audio Electrical equipment Chemical paints
1.7 2.8 5.4 9.9
17.2 28.3 54.5 100.0
6.2 1.3 11.3 18.8
33.0 6.9 60.1 100.0
Chairmans Statement (Cont`d)
13
The sales of audio division dropped by 9% while operating profit slumped significantly to RM1.7 million from RM6.2 million or a decrease of 73%. This division was hit particularly hard during the second half of the fiscal year which saw sales dropped by 39% resulting from a significant cutback in orders as our customers were themselves hit by a slowdown in demand for their electronic goods. Approximately 71% of the operating profit made in the first half was wiped out by the loss incurred in the second half of the fiscal year. The electrical equipment division, which sells most of its products in the North American market, suffered a significant set back in sales. Sales dropped by 31% to RM61.2 million from the previous fiscal year of RM89.2 million. Notwithstanding the above, operating profit for the fiscal year under review improved to RM2.8 million from RM1.3 million mainly due to the absence of foreign exchange losses. The operating profit of chemical paints division dropped 52% to RM5.4 million from RM11.3 million mainly due to the drop in sales especially in the second half of the fiscal year which saw its major customers reducing their demand, as the global economy worsened. During the financial crisis, we were more vigilant in monitoring our receivables. While we are proud with the improvement in the collection period and had no bad debts, we limited our receivables exposure by carefully evaluating the financial and liquidity position of our customers. Our financial position remained sound in these difficult times and the Group had no borrowings as of the end of the fiscal year. Net profit attributable to shareholders of the Company decreased to RM8.6 million from the previous fiscal year of RM15.1 million. This translated to lower earnings per share on a fully diluted basis of 4.93 sen as compared to 8.54 sen for the previous corresponding fiscal year. The Groups net asset per share dropped to 81 sen from 82 sen as substantial profit earned was distributed to shareholders of the Company in the form of dividend payments.
CORPORATE DEVELOPMENT On 19 May 2009, Formosa Prosonic Chemicals Sdn Bhd, a wholly-owned subsidiary of the Company had disposed off its entire equity interest of 30% in Musashi Paint Corporation Sdn Bhd for a total cash consideration of RM5.7 million to Musashi Paint Trading (H.K) Ltd, our subsidiary`s technical partner. Despite the disposal we are still in close partnership and together, we will continue to develop the chemical paint market through collaborative marketing and production initiatives.
DIVIDENDS The Company had paid an interim single tier tax exempt dividend of 4.50 sen (31 March 2008: 8.25 sen per ordinary share tax exempt) per ordinary share amounting to RM7,692,881 in respect of the financial year ended 31 March 2009. No final dividend has been recommended for consideration at the forthcoming Annual General Meeting.
Chairmans Statement (Cont`d)
14
PROSPECTS The environment for outsourcing remains favourable as B-to-C companies look to reduce costs and increase their marketing and research processes. Our time-tested commitment to our valued customers continues to work favourably for us. The Group has built a strong foundation that has enabled us to ride out challenges even in the light of the Asian Financial Crisis in 1997 and the outbreak of Severe Acute Respiratory Syndrome in 2003. Though the operating landscape for the industry remains highly competitive, the Group with its operational excellence and strong committed leadership at various levels of management is well poised to participate and capture any business opportunity that may arise, along with recovery in economy. While there remain uncertainties in the road to recovery in the global economy, the Group is cautiously optimistic for a profitable performance in the year ahead.
APPRECIATION On behalf of the Board, I would like to extend my deepest thanks and gratitude to our business partners, associates, customers and shareholders for their support and confidence in us over the years. My heartfelt appreciation also goes to our dedicated staff for their passion, hard work and contributions to the Group as together we worked hard to overcome the challenges faced in the previous fiscal year. With all your continued support, we are confident of moving forward to greater heights from where we were.
Chang Song Hai Chairman 25 August 2009 Kuala Lumpur, Malaysia
Elegant Styling,
Superior Engineering
Profile Of Directors
16
CHANG SONG HAI

Taiwanese, aged 63, Non-Executive Chairman, was appointed to the Board of Acoustech on 22 September 2001. Mr Chang had been involved in the plastic moulding industry for more than 40 years. Since 1968, he has been the Executive Chairman of Song Hai Plastic Industrial Co. Ltd., Taiwan, a company involved in the plastic moulding business. Mr Chang is the Chairman of both the Nomination and Remuneration Committee of the Company. Mr Chang holds directly 400,000 ordinary shares or 0.23% interest in the Company. Mr Chang is a Non-Independent Director as he is a substantial shareholder of Formosa Prosonic Industries Berhad (FPIB), whose wholly owned subsidiary Formosa Prosonic Manufacturing Sdn Bhd holds 42,295,914 ordinary shares or 24.74% interest in the Company.
SU CHENG TAO
Taiwanese, aged 63, Managing Director, was appointed to the Board of Acoustech on 18 September 2001. Mr Su holds a Diploma in Mechanical Engineering and he has more than 34 years of experience in the manufacturing industry. He started his career with Capetronics Group in Taiwan where he served for more than 10 years, gaining experience and expertise in manufacturing plastic components. Mr Su joined Formosa Prosonic Industries Berhad Group in 1988 where he served, as a General Manager in Formosa Prosonic Manufacturing Sdn Bhd until he left 2001 to join Acoustech. Mr Su holds directly 1,505,956 ordinary shares or 0.88% interest in the Company.
Profile Of Directors (Cont`d)
17
DATO NIK ABDUL AZIZ BIN CHEN PO HSIUNG MOHAMED KAMIL Taiwanese, aged 65, Executive Director, was appointed to
Malaysian, aged 66, Independent Non-Executive Director, was appointed to the Board of Acoustech on 3 September 2001. Dato Nik graduated from Universiti Malaya with a Bachelor of Arts Degree, Middlesex University, London with a Postgraduate Diploma in Personnel Management and Asian Institute of Management, Philippines with a Master in Management. He also attended the Senior Executive Program at the London Business School. Dato Nik has over 38 years of working experience in the human resource management/industry with attachments ranging from Petroliam Nasional Berhad (PETRONAS), Malaysian LNG Sdn Bhd, Bank Bumiputra Malaysia Berhad, Rothmants of Pall Mall(Malaysia) Sdn Bhd and the National Electricity Board. In 1997 he set up his own business, NA & Associates Sdn Bhd, a company involved in human resource training and skills management. Dato Nik is a Member of both the Audit and Remuneration Committee of the Company. Dato Nik holds directly 400,000 ordinary shares or 0.23% interest in the Company. the Board of Acoustech on 3 September 2001. He obtained a Diploma in Mechanical Engineering from Air Asia Jet Engine Training Center, Taiwan in 1971. Upon his graduation in 1971, Mr Chen joined Air Asia (Aircraft Co.) as a Technician. In 1980, he joined Great Century Paints Co. Ltd as a General Manager until his resignation in 1991. He was appointed as the General Manager of Formosa Prosonic Chemicals Sdn Bhd (FPC) in 1991 where his experience in the aircraft industry as well as in the chemical industry has contributed to the success story of FPC. Mr Chen manages the daily operations of FPC. Mr Chen holds directly 7,209,876 ordinary shares or 4.22% interest in the Company and is deemed interested in 265,846 ordinary shares held by his spouse.
18
HUANG HUAI SON

Taiwanese, aged 61, Executive Director, was appointed to the Board of Acoustech on 22 May 2002, Mr Huang holds a Diploma in Business Management and has accumulated 36 years of experience in the manufacturing industry. Mr Huang was involved with Foster Electric Co.Ltd, Taiwan, a manufacture of speaker units, for over 15 years until his resignation as its Vice President in 1987. Mr Huang is presently the advisor of New Advance Electronic Co. Ltd, Taiwan, a company specializing in the business of home theatre and multimedia speaker systems. Mr Huang holds directly 10,552,732 ordinary shares or 6.17% interest in the Company.
LEONG NGAI SENG

Malaysian, aged 37, Independent Non-Executive Director, was appointed to the Board of Acoustech on 25 February 2002. He obtained his law Degree and Commerce Degree LLB (Hons) B. Comm. from University of Melbourne and became a member of the Malaysian Bar in 1997. He was formerly an Assistant Vice-President in the Corporate Finance Department of a leading merchant bank in Malaysia. Mr Leong is currently a partner in his own law firm. Mr Leong is a Member of the Audit Committee, Nomination and Remuneration Committee of the Company. Mr Leong holds directly 350,000 ordinary shares or 0.20% interest in the Company.
19
SHIH CHAO YUAN

Taiwanese, aged 53, Non-Independent Non-Executive Director, was appointed to the Board of Acoustech on 25 February 2003. He holds a Master Degree in Management Science from Taiwan National Chiao Tung University. Prior to coming to Malaysia he was the assistant to the President of Friendship Corporation in Taiwan and was actively involved in the management and affairs of Friendship Corporation gaining experience and in-depth knowledge of speaker systems operations. In 1986 Mr Shih came to Malaysia to set up Formosa Prosonic Industries Sdn Bhd which has since listed on the Bursa Malaysia Securities Berhad. Mr Shih is currently the Group Managing Director of the Formosa Prosonic Industries Berhad (FPIB) Group of Companies. Mr Shih holds directly 1,854,290 ordinary shares or 1.08% interest in the Company and is deemed interested in 1,440,000 ordinary shares held by his spouse. As a representative of FPIB, Mr Shih is deemed to have an interest in 42,295,914 ordinary shares or 24.74% stake in the Company to the extent the Formosa Prosonic Industries Berhad Group has an interest in Acoustech.
Family Relationship
SOON KWAI CHOY

Malaysian, aged 58, Independent Non-Executive Director was appointed to the Board of Acoustech on 3 September 2001. He has held several senior positions in various major Malaysian corporations and was admitted as a member of the Association of Chartered Certified Accountants (ACCA) (UK) in 1979 and a member of the Malaysian Institute of Accountants (MIA) since 1980. He was the Past President of the Confederation of Asian and Pacific Accountants and former Vice-President of MIA. He sat in the International Council of the ACCA headquarters in London, United Kingdom from 1996-2008. He was awarded an honorary CPA by the Chinese Government in 1996. Mr Soon is the Chairman of the Audit Committee of the Company and a member of the Nomination Committee. Mr Soon holds directly 400,000 ordinary shares or 0.23% interest in the Company and is deemed interested in 610,000 ordinary shares held by his spouse.
None of Directors have any family relationship with any other director and/or major shareholder of the Company. Conflict of Interest The Company and/or its subsidiaries have entered into recurrent related party transactions of a revenue or trading nature with the Formosa Prosonic Industries Berhad Group of Companies (FPIB Group) in which the Directors of the Company, namely Mr Shih Chao Yuan and Mr Chang Song Hai have interests. By virtue of their interest, they are deemed to be interested in the recurrent related party transactions entered into with the FPIB Group. Save for the above, none of the Directors have any conflict of interest with the Company. Conviction For Offences None of the Directors has been convicted for any offences within the past ten (10) years.
Note : The Directors` interest in shares are based on the total number of shares as at 24 July 2009 after adjusting for 6,366,300 treasury shares bought back up to 24 July 2009
Corporate Social Responsibility
20
Acoustech Group views responsibility as a key issue in its management system. The Group strives for stable and responsible operations in term of smooth-running processes, high standard of occupational safety and minimising environmental impact.
FINANCIAL RESPONSIBILITY Financially responsible operations are essential for a profitable bussiness. A financially responsible company benefits a companys shareholders, its employees and partners, and society as a whole. The Group offers a solid source of business to numerous suppliers and subcontractors. The Group purchased RM208.0 million worth of materials (before consolidation adjustment) in financial year 2009 for use in production. Employees benefits which comprise salaries and wages, contribution to retirement fund and other remuneration amounted to RM26.7 million in financial year 2009.
Materials Consumed RM Million Employees` Benefits RM Million 300 40 200 30 20 10
100
2006
2007
2008
2009
2006
2007
2008
2009
Shareholders benefits from their holding through dividends and possible capital gain with rise in share price. During the financial year 2009, the Company paid a single-tier tax-exempt dividend of 8.25 sen per share equivalent to RM14.4 million.
Dividend Paid RM Million 30 20 10
2006
2007
2008
2009
Corporate Social Responsibility (Cont`d)
21
As the below graph depicts, the financial position of the Group remains strong and sound.
Capital Structure RM Million 300
200
100
2006
2007
2008
2009
Shareholders` Equity
Cash and cash equivalents
Interest-bearing debts
ENVIRONMENTAL RESPONSIBILITY As a manufacturer of audio, chemical paints and electrical products to consumers worldwide, the Group is fully committed to implementing environmental management system based on the ISO14001 Standard with the aim to conserve global environment and create a sustainable society. This underpins our approach to environmental responsibility. To achieve our goal, we strive to make continuous improvement in our effort to comply with all applicable legal environmental legislations and regulations and other requirements to which the Group subscribes. Environmental impacts are minimised and reduced by: Control in the usage of chemicals; Eliminating the use of ozone-depleting substances; Reduce generation of solid and schedule waste through recycling and reuse of materials; Engineering control on noise and air pollution; Control of the discharge of sewage and industrial effluents; Non-use of environmental hazardous substances as prohibited by customers; and Control and management of energy consumption.
We set and review targets and objectives in order to improve our environmental performance. We create and promote environmental awareness to all suppliers and employees through meeting, training and education.
Corporate Social Responsibility (Cont`d)
22
Our approach fully complement and support environmental conservation programmes undertaken by our major customers. We have been a green partner to Sony Green Partner Environment Quality Approval Programmes and in compliance with Green Procurement Standards by Panasonic.
SAFETY AND HEALTH RESPONSIBILITY The Group would continuously work to enhance safety and health management. The Group is committed to zero accidents. Poor safety and health performance impacts financial performance, either in the form of additional expenses or lost revenue, while good safety performance contributes to better employee well-being and competitiveness. This responsibility is administered by a committee which embraces all division managers. A number of safety and health training programs have been developed to enhance performance, and safety training is an integral part of the manager responsibilities. Safeguard measures include : Accident prevention plan; Accident investigation and reporting; Machine safety and handling of materials and chemicals; Emergency response plan; Emergency action plan (evacuation procedures, alarm systems, shutdown procedures and etc); Safe forklift driving; Fire hazards prevention control; and First aid skills.
Designed to Impress,
With the convenience to delight
Audit Committee Report
24
THE BOARD OF DIRECTORS (the Board) of Acoustech Berhad (the Company) is pleased to present the report of the Audit Committee for the financial year ended 31 March 2009. Chairman Soon Kwai Choy Independent Non-Executive Director Members Dato Nik Abdul Aziz Bin Mohamed Kamil Independent Non-Executive Director Leong Ngai Seng Independent Non-Executive Director Su Cheng Tao (Resigned on 20 May 2008) Managing Director
TERMS OF REFERENCE Constitution The Audit Committee was constituted per resolution of the Board on 4 September 2001 and its terms of reference are consistent with the Listing Requirements of Bursa Malaysia Securities Berhad (the Exchange). Authority The Audit Committee is authorised by the Board to investigate any activity within its terms of reference. It has unlimited access to all information relevant to its activities. It is authorised by the Board to obtain legal or other professional advice if it deems necessary.
COMPOSITION The Audit Committee shall comprise at least 3 directors all of which must be non-executive directors with a majority of them being independent directors; Alternate director shall not be appointed as members of the Audit Committee; At least one member of the Audit committee shall be a member of the Malaysian Institute of Accountants or a person who fulfills the specific requirements as prescribed or approved by the Exchange. In the event of any vacancy in the Audit Committee resulting in the noncompliance of the Exchanges Listing Requirements, the vacancy shall be filled within 3 months. The members of the Audit Committee shall elect a chairman from among their number who shall be an independent director. Members of the Committee shall serve for a period of two years and then retire from office but shall be eligible for re-appointment.
Audit Committee Report (Cont`d)
25
FUNCTIONS The Audit Committee shall, amongst others, discharge the following functions : Review the following and report the same to the Board of Directors :with the external auditors, the audit plan; with the external auditors, his evaluation of the system of internal controls; the assistance given by employees to the external auditor; the adequacy of the scope, functions, competency and resources of the internal audit functions and the necessary authority of the internal auditor has to carry out the work; the internal audit program, processes, the results of the internal audit program, processes or investigations undertaken and whether or not appropriate action is taken on the recommendations of the internal audit function; the quarterly results and year-end financial statements, prior to the approval by the Board focusing particularly on :i) ii) iii) iv) changes in or implementation of major accounting policy changes; significant and unusual events; the going-concern assumptions; and compliance with accounting standards and other legal requirements.
any related party transactions and the conflict of interest situation including any transaction, procedure or course of conduct that raises questions of management intergrity; any letter of resignation from the external auditors; and whether there is any reason and supported by grounds, to believe that the external auditors is not suitable for re-appointment.
Recommend the nomination of a person or persons as external auditors; Report promptly to the Exchange on any matter the Audit Committee had reported to the Board of Directors, which was not satisfactorily resolved and/or resulted in a breach of the Exchanges Listing Requirements; Consider and report on matter requested by the Board of Directors; and To verify the basis of allocation of the options under the Employees Share Options Scheme (ESOS) in accordance with the Bye-Laws of ESOS.
Audit Committee Report (Cont`d)
26
ACTIVITIES The Committee met four (4) times for the year under review and carried out the following activities : Reviewed the unaudited quarterly financial statements before submission to the Board for approval; Reviewed the internal audit programs, reports and remedial action taken; Assessed the Groups overall system of internal control; Reviewed the Related Party Transactions, the conflict of interest declarations and the Circular to Shareholder in relation to Recurrent Related Party Transactions; and Verified the basis of allocation of the options under the Employees Share Option Scheme (ESOS) in accordance with the basis By-Laws of ESOS.
MEETINGS The Audit Committee met four (4) times during the financial year end 31 March 2009. Details of attendance are as follows : Name of Director Soon Kwai Choy Dato Nik Abdul Aziz Bin Mohamed Kamil Leong Ngai Seng Su Cheng Tao (Resigned on 20 May 2008) Attendance 4/4 3/4 4/4 1/1
INTERNAL AUDIT FUNCTION An Internal Audit Function was set up to undertake continuous systematic reviews of the Groups internal control systems so as to provide the Board with reasonable assurance that such systems continue to operate satisfactorily and effectively. The Group has adopted a risk-based approach to the implementation and monitoring of controls and had carried out an exercise to identify and evaluate the risks associated with the Group.
Corporate Governance Statement
27
The Board of the Company is committed to ensure the fullfillment of the highest standards of Corporate Governance as set out in the Malaysian Code on Corporate Governance, which highlights the principles and best practices on structures and processes that the Company may use in their operations towards achieving the optimal governance framework. 1. THE BOARD OF DIRECTORS 1.1 Board Responsibilities The Board retains effective control of the Company and the Group and is responsible for the overall corporate affairs, strategic direction, formulation of policies and the overall performance of the Company and the Group. The Executive Directors take on primary responsibility for managing the Groups business and resources. 1.2 Board Balance The Company is led by an experienced Board comprising eight (8) members of whom three (3) are Independent Non-Executive Directors, two (2) are Non-Independent Non-Executive Directors and three (3) are Executive Directors. No individual or group of individuals dominates the Boards decision making. Independent Directors constitute more than one-third of the Board and the interest of the significant shareholder is fairly represented on the Board. The present Directors bring a wide range of experience and skills relevant to the business of the Group. Brief descriptions on the background of each Director are set out on pages 16 to 19. There is clear division of responsibility between the Chairman and Managing Director to ensure the balance of power and authority. The Managing Director is under the control of the Board. The Independent Non-Executive Directors provide independent judgement and check and balance on the Board. 1.3 Board Meeting The Board meets at least four (4) times a year and has a formal schedule of matters reserved for it. Additional meetings are held as and when necessary. During the financial year 2009, four meetings were held in which the Board deliberated upon and considered various issues including the Groups financial results, annual budgets, performance of the Groups business, major investment, business plan and policies and strategic issues affecting the Groups business. Details of attendance of the Directors at Board meetings held during the financial year are as follows :Total Number of Meetings Chang Song Hai Su Cheng Tao Dato Nik Abdul Aziz Bin Mohamed Kamil Chen Po Hsiung Huang Huai Son Leong Ngai Seng Shih Chao Yuan Soon Kwai Choy 4 4 4 4 4 4 4 4 Number of Meetings Attended 4 4 3 4 4 4 4 4
Corporate Governance Statement (Cont`d)
28
1.4 Supply of Information The Board has unrestricted access to timely and accurate information necessary in the furtherance of their duties. At each Board meeting, the Managing Director briefs the Board on the Groups activities and operations. Directors have access to the advice and services of the Company Secretary and where necessary, obtain independent professional advise at the Groups expense. 1.5 Board Committees The Board of Directors delegates certain responsibilities to Board Committees namely the Audit Committee, Remuneration Committee and Nomination Committee in order to enhance business and operational efficiency and effectiveness. 1.6 Appointments to the Board The duties and functions of the Nomination Committee encompass the following :Recommend to the Board, candidates nominated by shareholders or the Board for directorships to be filled; Recommend to the Board, directors to fill seats on board committees; Review annually the required skills and experience and other qualities and core competencies non-executive directors should bring to the Board; and Assess annually the effectiveness of the Board as a whole and the contribution of each individual director.
The decision on new appointment of directors rests with the Board after considering the recommendation of the Nomination Committee. The members of the Nomination Committee are as follows :Chang Song Hai Leong Ngai Seng Soon Kwai Choy Chairman Non-Independent Non-Executive Director Independent Non-Executive Director Independent Non-Executive Director
During the financial year under review, the Committee met once to conduct the annual review on the Directors core competencies, contribution and effectiveness. 1.7 Re-election of Directors In accordance with the Companys Articles of Association, one-third of the Directors are required to submit themselves for re-election by rotation at least once every three years at each Annual General Meeting (AGM). Retiring Directors can offer themselves for re-election. Directors who are appointed during the financial year are, in accordance with the Companys Articles of Association, required to retire at the AGM following their appointment but are eligible for re-election by the shareholders.
29
1.8 Directors Training All Directors of the Company have attended Bursa Malaysias Mandatory Accreditation Programme (MAP). The directors will also attend relevant training programmes from time to time. During the year, the following Directors attended training as listed below : Name of Director Soon Kwai Choy Title MIA NAC on 25 and 26 November 2008 Emotional Spiritual Quotient on 3 to 5 December 2008 Global Network For Local Governance in Kolkata India on 11 to 13 December 2008
Chen Po Hsiung
MAICSA Annual Conference of Corporate & Regulatory Updates on 7 and 8 July 2009 MAICSA Annual Conference of Corporate & Regulatory Updates on 7 and 8 July 2009 MAICSA Annual Conference of Corporate & Regulatory Updates on 7 and 8 July 2009 MAICSA Annual Conference of Corporate & Regulatory Updates on 7 and 8 July 2009
Su Cheng Tao
Leong Ngai Seng
Shih Chao Yuan
Chang Song Hai and Huang Huai Son are non residents and therefore did not attend any training programme conducted or held in Malaysia. Dato` Nik Abdul Aziz owns and operates a company which specializes in providing training. He therefore did not enrol in any other public courses in Malaysia.
2.
DIRECTORS REMUNERATION The Board has set up the Remuneration Committee whose primary responsibility include reviewing and making recommendations on remuneration packages and policies applicable to the Chairman, Managing Director, Senior Executives and Directors themselves. The Remuneration Committee obtains independent advice on the appropriateness of remuneration packages. Individual Directors are required to abstain from discussion on their own remuneration. The determination of the remuneration of Non-Executive Directors is a matter for the Board as a whole.
30
The members of the Remuneration Committee are as follows :Chang Song Hai Chairman, Non-Independent Non-Executive Director Dato Nik Abdul Aziz Bin Mohamed Kamil Independent Non-Executive Director Leong Ngai Seng Independent Non-Executive Director During the financial year under review, the Committee met once to review the principles and guidelines on directors remuneration adopted by the Board and the levels of remuneration applied. For the financial year 2009, the remuneration of the Directors are as follows :Fees (RM) Executive Directors Non-Executive Directors Total 90,000 165,000 255,000 Total Emoluments Benefits-in-kind Remuneration (RM) (RM) (RM) 1,150,668 58,400 1,209,068 35,256 35,256 1,275,924 223,400 1,499,324
The number of Directors whose total remuneration falls within the following bands is as follows :Executive Directors Below RM50,000 RM50,001 - RM100,000 RM100,001 - RM250,000 RM250,001 - RM300,000 RM300,001 - RM350,000 RM350,001 - RM400,000 RM450,001 - RM500,000 RM550,001 - RM600,000 RM650,001 - RM700,000 RM750,001 - RM800,000 RM850,001 - RM900,000 3. SHAREHOLDERS The Board of Directors recognizes the importance of communication and timely dissemination of information to shareholders. Information is communicated through announcements to the Bursa Malaysia and the distribution of annual reports to shareholders. General Meetings serve as the principal forum for communicating with the shareholders of the Company. The Board encourages participation of shareholders at the General Meeting to ensure a high level of accountability and identification with the Groups strategy and goals. The Company follows a continuous disclosure policy, making announcements to the Bursa Malaysia when it becomes aware of information which might materially affect the price of its shares. 4. ACCOUNTABILITY AND AUDIT 4.1 Financial Reporting The Board aims to provide and present a balanced and clear assessment of the Groups financial performance and prospect primarily through the annual financial statements and quarterly report as well as announcements to the Bursa Malaysia. The Audit Committee assists the Board in scrutinizing information for disclosure to ensure compliance with accounting standard, accuracy, adequacy and completeness. 1 1 1 Non-Executive Directors 4 1 -
31
4.2 Statement of Directors Responsibility in respect of Audit Financial Statements The Board is responsible for ensuring that the financial statements of the Group gives a true and fair view of the state of affairs of the Group and of the Company as at the end of the accounting period and of their income statements and cashflows for the period. These involve Directors selecting suitable accounting policies and then applying them consistently and make judgements and estimates that are reasonable and prudent. The Directors have the responsibility of ensuring that proper accounting records are kept which disclose with reasonable accuracy the financial position of the Group and of the Company and which ensures that the financial statements comply with the Companies Act, 1965. 4.3 Internal Control The Board of Directors is ultimately responsible for the overall system of internal control which includes not only financial controls but also controls relating to operations, compliance and risk management. The internal control system was designed to manage rather than eliminate risks of failure in achieving the Groups business objectives; and as such could only provide reasonable but not absolute assurance against material misstatement or loss. The Statement on Internal Control as set out on page 33 in this Annual Report provides an overview of the state of internal controls with the Group. 4.4 Statement of Internal Audit Function Internal Audit activities are conducted in-house. During the financial year, the Internal Audit Unit (IAU) conducted various internal audit engagements in accordance with the risk-based audit plans which are consistent with the organisations goals. The internal audit function is carried out impartially, proficiently and with due professional care. The IAU reports to the Audit Committee on regular audits and appraisals of key operations of the Group. Its activities for the year under review include: Procedural checks in relation to the acquisition and/or disposal of investments and changes to the Group`s structure; Reviewing of approval and payments processes, receipts for deposit and miscellaneous payment; Observing the stock take to ensure that the stock take was conducted in a proper and orderly manner; Identifying the Related Party Transactions and Recurrent Related Party Transactions to ensure that the transactions were conducted at arms lenght; and Conducting reviews requested by the Audit Committee The total cost incurred for the internal audit function of the Group for fiscal year 2009 is RM70,000. Cost Category Manpower Travelling 4.5 Relationship with the Auditors The external auditors, Messrs BDO Binder have continued to report to members of the Company on their findings which are included as part of the Companys financial reports with respect to each years audit on the statutory financial statements. In doing so the Company has established a transparent arrangement with the auditors to meet their professional requirements. The auditors have, from time to time, highlighted to the Audit Committee and the Board matters requiring the Boards attention. RM (000) 56 14 % of total cost 80 20
Other Information
32
Conflict of Interests None of the Directors has any family relationships with other Directors or major shareholders of the Company. Convictions for Offences None of the Directors has been convicted for offences within the past ten years other than traffic offences, if any. Utilisation of Proceeds There were no issuance of new shares, rights issue or issuance of bonds during the financial year to raise any cash proceeds except for the issuance of 177,000 new shares pursuant to the exercise of options under the Companys Employees Share Option Scheme. The proceeds raised were utilized for working capital requirements. Imposition of Sanctions and/or Penalties There were no sanctions and/or penalties imposed on the Company or its subsidiaries, Directors or Management by relevant regulatory bodies during the financial year. Share Buybacks 4,612,400 shares were bought back during thr financial year. Full details of this buy backs can be found on note 17, page 80 of this Annual Report . Option, Warrants or Convertible Securities During the financial year, 177,000 new shares were issued pursuant to the exercise of options under the Companys Employees Share Option Scheme. The proceeds raised were utilised for working capital requirements. American Depository Receipts (ADR) and Global Depository Receipts (GDR) The Company has not sponsored any ADR or GDR programme for the financial year. Non-Audit Fees There were RM51,419 non-audit fees paid to the external auditors for the financial year. Profit Estimate, Forecast or Projection The Company did not make any release on profit estimates, forecast or projections during the financial year. Profit Guarantee There was no profit guarantee given by the Company during the financial year. Material Contracts There were no material contracts entered into by the Company and/or its subsidiary companies which involved Directors and major shareholders interests either still subsisting at the end of the financial year ended 31 March 2009 or entered into since the end of the previous financial year. Recurrent Related Party Transactions of a Revenue or Trading Nature Details of transactions with related parties undertaken by the Group during the financial year under review are disclosed in note 28 to the financial statements. Contracts Relating to Loans There was no contract relating to loans by the Company. Revaluation of Landed Properties The Company and the Group have not adopted a policy for regular revaluation of its landed properties.
Statement Of Internal Control
33
Pursuant to paragraph 15.26(b) of the Listing Requirements of Bursa Malaysia Securities Berhad, the Board of Directors is pleased to provide the following statement on the state of internal controls of the Group.
Board Responsibility The Board of Directors acknowledges its responsibility for the Groups system of internal control that is designed to manage rather than eliminate the risks of failure to achieve business objectives; and as such could only provide reasonable, but not absolute assurance against material misstatement or loss. The Board confirms that there is an ongoing process which is in place for the financial year under review for identifying, evaluating and managing significant risks that may affect the achievement of our business objectives. Our system of Internal controls cover financial, organizational, operational, and administrative and compliance controls. The Board regularly reviews the control processes with the assistance of the Audit Committee.
Key Processes Salient features of the key processes of the system of internal control of the Group are as follows : 1. The management structure is well defined, with clear lines of authority and responsibility. The Board continually assesses business performance and evaluates operation controls at all levels, and where necessary takes appropriate remedial action. The Managing Director regularly updates the Board on industry trend, key customers and performance of various units within the Group, and the Board endorses responses taken. Financial results are reviewed quarterly by the Audit Committee and the Board and compared to budgets and forecasts. Executive Directors and heads of departments meet regularly to discuss operational, management issues, financial performance and indicators focusing on the evaluation of applicable risks. Operations ISO Standards 9001:2000 and 14001 and Accounting procedures are communicated to staff at all levels.
2.
3.
4.
5.
6.
Statement Of Internal Control (Cont`d)
34
7.
The Groups Internal Audit Unit (IAU) which reports to the Audit Committee performs regular reviews to assess the effectiveness of internal controls and to identify significant risks. The Audit Committee reviews actions taken on internal control issues raised by the IAU and external auditors. Formal recruitment, training and development, and performance appraisals are in place to ensure and maintain the professionalism and competency of staff.
8.
9.
10. The Audit Committee reviews the Recurrent Related Party Transactions undertaken by the Group twice a year. 11. The Group had established a set of corporate values, ethical behavior, and a guidance for quality products and services and these are set out in the Groups Employee Handbook and Safety Handbook.
Conclusion The Board is satisfied with the ongoing process for identifying, evaluating, managing and monitoring significant risks, and is of the opinion that the Groups internal control systems are adequate. The Board also confirmed that they have reviewed the integrity and the effectiveness of the system of internal control through the monitoring process set out above and are not aware of any significant weakness or deficiency in the Groups system of internal control for the financial year under review and to the date of approval of this annual report and financial statements.
directors report statement by directors statutory declaration independent auditors report balance sheets income statements statements of changes in equity cash flow statements notes to the financial statements
36 42 42 43 45 47 48 50 52
financial statements
Directors Report
36
The Directors have pleasure in submitting their report and the audited financial statements of the Group and of the Company for the financial year ended 31 March 2009.
PRINCIPAL ACTIVITIES The Company is an investment holding company. The principal activities of the subsidiaries are set out in Note 9 to the financial statements. There have been no significant changes in the nature of these activities during the financial year.
RESULTS Group RM Profit for the financial year Attributable to: Equity holders of the Company Minority interests 9,271,521 Company RM 13,806,910
8,547,156 724,365 9,271,521
13,806,910 13,806,910
DIVIDENDS Dividend paid since the end of the previous financial year was a final single tier tax exempt dividend of 4.5 sen per ordinary share amounting to RM7,811,996 in respect of the financial year ended 31 March 2008 which was paid on 10 November 2008. On 20 May 2009, the Directors declared a first interim single tier tax exempt dividend of 4.5 sen per ordinary share amounting to RM7,692,881 in respect of the financial year ended 31 March 2009. The dividend was paid to the shareholders on 15 July 2009 whose names appeared on the Record of Depositors at the close of business on 30 June 2009. The Directors do not recommend the payment of any final dividend in respect of the current financial year.
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 During the financial year, the issued and paid-up ordinary share capital of the Company was increased from RM88,503,600 to RM88,592,100 by way of: Class of shares Ordinary shares of RM0.50 each Number of shares 67,000 Terms of issue Exercise of Employees Share Option Scheme (ESOS). The ESOS shares were exercised at an option price of RM0.612 per ordinary share for cash. Exercise of ESOS. The ESOS shares were exercised at an option price of RM0.625 per ordinary share for cash.
Ordinary shares of RM0.50 each
110,000
Directors Report (Cont`d)
37
ISSUE OF SHARES AND DEBENTURES (continued) The abovementioned new ordinary shares issued rank pari passu in all respects with the then existing ordinary shares of the Company. There were no other issues of shares during the financial year. There were no issues of debentures during the financial year.
TREASURY SHARES During the financial year, the Company repurchased 4,612,400 ordinary shares of RM0.50 each of its issued ordinary share capital from the open market at an average price of RM0.82 per ordinary share. The total consideration paid for the repurchase including transaction costs was RM3,778,396. The repurchase transactions were financed by internally generated funds. The shares repurchased were held as treasury shares and treated in accordance with the requirement of Section 67A of the Companies Act, 1965. As at 31 March 2009, the Company held a total of 6,366,300 of its 177,184,200 issued ordinary share capital as treasury shares. Such treasury shares are being held at a carrying amount of RM5,520,461 and further relevant details are disclosed in Note 17 to the financial statements.
OPTIONS GRANTED OVER UNISSUED SHARES No options were granted to any person to take up unissued ordinary shares of the Company during the financial year apart from the issue of options pursuant to the Employees Share Option Scheme (ESOS). The ESOS of the Company was approved by its shareholders at an Extraordinary General Meeting held on 23 September 2004 and came into effect on 29 October 2004. The main salient features of the ESOS are as follows: (a) The ESOS is made available to eligible employees and Directors of the Group. (b) The maximum number of new ordinary shares, which may be available under the ESOS, shall not exceed in aggregate fifteen per centum (15%) of the issued and paid-up ordinary share capital of the Company at any one time during the duration of the ESOS. (c) The maximum number of new options that may be offered to an eligible person shall be determined at the discretion of the option committee taking into consideration the performance, seniority and length of service of the eligible person and such other factors that the option committee may deem relevant, subject to the following: (i) the aggregate allocation to eligible Directors and senior management shall not exceed fifty per centum (50%) of the new ordinary shares available under the ESOS; and
(ii) the allocation to any eligible person who, either singly or collectively through persons connected to him, hold twenty per centum (20%) or more of the issued and paid-up capital of the Company, shall not exceed ten per centum (10%) of the ordinary shares available under the ESOS. (d) The ESOS shall be in force for a period of five (5) years, unless terminated earlier or extended in accordance with the terms of By-Laws of the ESOS. (e) The price at which the option holders are entitled to subscribe for each new ordinary shares shall be based on the five (5)-day weighted average market price of the Companys shares immediately preceding the offer date of the option, with a discount of not more than ten per centum (10%), or at the par value of the Companys shares, whichever is higher.
38
OPTIONS GRANTED OVER UNISSUED SHARES (continued) (f) The new ordinary shares to be allotted upon the exercise of any options granted shall upon allotment and issue, rank pari passu in all respects with the existing issued and paid-up ordinary shares of the Company provided always that the new ordinary shares will not be entitled to any dividends, rights, allotments and/or other distributions, the entitlement date of which is prior to the date of allotment of the said new ordinary shares. The movements of the options over unissued ordinary shares of the Company granted under the ESOS during the financial year are as follows: Number of options over ordinary shares of RM0.50 each Balance Balance as at as at 1.4.2008 Exercised Lapsed 31.3.2009 1,018,000 690,800 1,708,800 (110,000) (67,000) (177,000) (61,000) (61,000) 908,000 562,800 1,470,800
Date of offer 29 October 2004 24 November 2005
Option price RM0.625 RM0.612
The Company has been granted exemption by the Companies Commission of Malaysia from having to comply with Section 169(11) of the Companies Act, 1965 to disclose the list of option holders who are granted options during the financial year to subscribe for less than 200,000 shares in the Company. No option holder was granted option to subscribe for 200,000 shares and above during the financial year.
DIRECTORS The Directors who have held for office since the date of the last report are: Chang Song Hai Su Cheng Tao Dato Nik Abdul Aziz Bin Mohamed Kamil Chen Po Hsiung Huang Huai Son Leong Ngai Seng Shih Chao Yuan Soon Kwai Choy
39
DIRECTORS INTERESTS The Directors holding office at the end of the financial year and their beneficial interests in the ordinary shares of the Company and its related corporations during the financial year ended 31 March 2009 as recorded in the Register of Directors Shareholdings kept by the Company under Section 134 of the Companies Act, 1965 are as follows: Number of ordinary shares of RM0.50 each Balance Balance as at Exercise of as at 1.4.2008 ESOS/Bought Sold 31.3.2009 Shares in the Company Direct interests Dato Nik Abdul Aziz Bin Mohamed Kamil Chang Song Hai Su Cheng Tao Chen Po Hsiung Huang Huai Son Leong Ngai Seng Shih Chao Yuan Soon Kwai Choy Indirect interests Chen Po Hsiung * Shih Chao Yuan # Soon Kwai Choy * * # 95,723 41,842,194 610,000 1,893,720 95,723 43,735,914 610,000 400,000 400,000 2,005,956 7,209,876 10,552,732 400,000 1,854,290 400,000 (500,000) 400,000 400,000 1,505,956 7,209,876 10,552,732 400,000 1,854,290 400,000
Deemed interest held through spouse Deemed interest pursuant to Section 6A of the Companies Act, 1965 and held through spouse
By virtue of their interests in the ordinary shares of the Company and pursuant to Section 6A to the Companies Act, 1965, Su Cheng Tao, Chen Po Hsiung, Huang Huai Son and Shih Chao Yuan are deemed to be interested in the shares of the subsidiaries to the extent that the Company has an interest.
DIRECTORS BENEFITS Since the end of the previous financial year, none of the Directors have received or become entitled to receive any benefit (other than a benefit included in the aggregate amount of emoluments received or due and receivable by the Directors as shown 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 the Director is a member, or with a company in which the Director has a substantial financial interest except for any benefit which may be deemed to have arisen from the transactions disclosed in Note 28 to the financial statements. There were no arrangements during and at the end of the financial year, to which the Company is a party, which had the object of enabling Directors of the Company to acquire benefits by means of the acquisition of shares in or debentures of the Company or any other body corporate except for the share options granted to Directors of the Company pursuant to the ESOS.
40
OTHER STATUTORY INFORMATION REGARDING THE GROUP AND THE COMPANY (I) AS AT THE END OF THE FINANCIAL YEAR (a) Before the income statements and balance sheets of the Group and of the Company were made out, the Directors took reasonable steps: (i) to ascertain that proper action had been taken in relation to the writing off of bad debts and the making of provision for doubtful debts and satisfied themselves that all known bad debts had been written off and that no provision needs to be made for doubtful debts; and
(ii) to ensure that any current assets other than debts, which were unlikely to realise their book values in the ordinary course of business had been written down to their estimated realisable values. (b) In the opinion of the Directors, the results of the 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. (II) FROM THE END OF THE FINANCIAL YEAR TO THE DATE OF THIS REPORT (c) The Directors are not aware of any circumstances: (i) which would render the amount written off for bad debts inadequate to any material extent or necessitate the making of provision for doubtful debts in the financial statements of the Group and of the Company; and
(ii) which would render the values attributed to current assets in the financial statements of the Group and of the Company misleading; and (iii) which have arisen which would render adherence to the existing method of valuation of assets or liabilities of the Group and of the Company misleading or inappropriate. (d) In the opinion of the Directors: (i) there has not arisen any item, transaction or event of a material and unusual nature 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; and
(ii) no contingent or other liability has become enforceable, or is likely to become enforceable, within the period of twelve (12) months after the end of the financial year which will or may affect the abilities of the Group and of the Company to meet their obligations as and when they fall due. (III) AS AT THE DATE OF THIS REPORT (e) There are no charges on the assets of the Group and of the Company which have arisen since the end of the financial year to secure the liabilities of any other person. (f) There are no contingent liabilities of the Group and of the Company which have arisen since the end of the financial year. (g) The Directors are not aware of any circumstances not otherwise dealt with in the report or financial statements which would render any amount stated in the financial statements of the Group and of the Company misleading.
41
SIGNIFICANT EVENT SUBSEQUENT TO THE BALANCE SHEET DATE The event subsequent to the balance sheet date is disclosed in Note 32 to the financial statements.
AUDITORS The auditors, BDO Binder, have expressed their willingness to continue in office.
Signed on behalf of the Board in accordance with a resolution of the Directors.
......................................................... Su Cheng Tao Director Port Klang 30 July 2009
......................................................... Chen Po Hsiung Director
Statement By Directors
42
In the opinion of the Directors, the financial statements set out on pages 45 to 98 have been drawn up in accordance with applicable approved Financial Reporting Standards in Malaysia and the provisions of the Companies Act, 1965 so as to give a true and fair view of the state of affairs of the Group and of the Company as at 31 March 2009 and of the results of the operations of the Group and of the Company and of the cash flows of the Group and of the Company for the financial year then ended. On behalf of the Board,
...................................................... Su Cheng Tao Director Port Klang 30 July 2009
........................................................ Chen Po Hsiung Director
Statutory Declaration
I, Gan Ah Chu, being the officer primarily responsible for the financial management of Acoustech Berhad, do solemnly and sincerely declare that the financial statements set out on pages 45 to 98 are, to the best of my knowledge and belief, 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. Subscribed and solemnly declared by the abovenamed at Kuala Lumpur this 30 July 2009 Before me: S.Ideraju No.W451 Persuruhjaya Sumpah Malaysia Tingkat 18, Wisma Sime Darby Jalan Raja Laut 50350 Kuala Lumpur ) ) )
Gan Ah Chu
Independent Auditors Report

To The Members of Acoustech Berhad
43
Report on the Financial Statements We have audited the financial statements of Acoustech Berhad, which comprise the balance sheets as at 31 March 2009 of the Group and of the Company, and the income statements, statements of changes in equity and cash flow statements of the Group and of the Company for the financial year then ended, and a summary of significant accounting policies and other explanatory notes, as set out on pages 45 to 98. Directors Responsibility for the Financial Statements The Directors of the Company are responsible for the preparation and fair presentation of these financial statements in accordance with applicable approved Financial Reporting Standards in Malaysia and the provisions of the Companies Act, 1965. This responsibility includes: designing, implementing and maintaining internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error; selecting and applying appropriate accounting policies; and making accounting estimates that are reasonable in the circumstances. 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 our judgement, including the assessment of risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, we consider internal control relevant to the Companys preparation and fair presentation of the financial statements 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 Companys 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 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 applicable approved Financial Reporting Standards in Malaysia and the provisions of the Companies Act, 1965 so as to give a true and fair view of the state of affairs of the Group and of the Company as at 31 March 2009 and of the results of the operations of the Group and of the Company and of the cash flows of the Group and of the Company for the financial year then ended.
Independent Auditors Report

To The Members of Acoustech Berhad (cont`d)
44
Report on Other Legal and Regulatory Requirements In accordance with the requirements of the Companies Act, 1965, we also report the following: (a) In our opinion, the accounting and other records and the registers required by the Act to be kept by the Company and its subsidiaries have been properly kept in accordance with the provisions of the Act. (b) We are satisfied that the financial statements of the subsidiaries that have been consolidated with the Companys financial statements 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 required by us for those purposes. (c) The audit reports on the financial statements of the subsidiaries did not contain any qualification or any adverse comment made under Section 174(3) of the Act. 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 to any other person for the content of this report.
BDO Binder AF : 0206 Chartered Accountants Kuala Lumpur 30 July 2009
Gan Hock Soon 2853/07/10 (J) Partner
Balance Sheets
As At 31 March 2009
45
Group Note ASSETS Non-current assets Property, plant and equipment Prepaid lease payments for land Investments in subsidiaries Investment in a jointly controlled entity Investment in an associate Other investment 7 8 9 10 11 12 37,937,842 9,062,725 2,273,004 5,639,193 3,755,630 58,668,394 38,922,913 9,200,248 1,911,255 5,574,186 3,755,630 59,364,232 74,893,666 74,893,666 2009 RM 2008 RM 2009 RM
Company 2008 RM
74,893,666 74,893,666
Current assets Inventories Trade and other receivables Current tax assets Cash and cash equivalents 13 14 15 23,884,684 42,414,914 3,064,301 49,165,242 118,529,141 TOTAL ASSETS 177,197,535 32,396,025 71,901,386 1,530,631 42,026,638 147,854,680 207,218,912 33,452,332 197,332 232,695 33,882,359 108,776,025 37,678,005 296,718 118,653 38,093,376 112,987,042
The accompanying notes form an integral part of the financial statements.
Balance Sheets
As At 31 March 2009 (cont`d)
46
Group Note EQUITY AND LIABILITIES Equity attributable to equity holders of the Company Share capital Treasury shares Reserves 16 17 18 88,592,100 (5,520,461) 59,633,308 142,704,947 Minority interests TOTAL EQUITY 6,157,079 148,862,026 88,503,600 (1,742,065) 58,876,894 145,638,429 5,852,214 151,490,643 88,592,100 (5,520,461) 25,314,458 108,386,097 108,386,097 2009 RM 2008 RM 2009 RM
Company 2008 RM
88,503,600 (1,742,065) 19,298,290 106,059,825 106,059,825
LIABILITIES Non-current liabilities Deferred tax liabilities Current liabilities Trade and other payables Borrowing (secured) Dividend payable Current tax payable 20 21 24,859,653 64,556 24,924,209 TOTAL LIABILITIES TOTAL EQUITY AND LIABILITIES 28,335,509 177,197,535 45,281,712 664,395 6,574,092 181,070 52,701,269 55,728,269 207,218,912 389,928 389,928 389,928 108,776,025 353,125 6,574,092 6,927,217 6,927,217 112,987,042 19 3,411,300 3,027,000 -
Income Statements
For The Financial Year Ended 31 March 2009
47
Group Note Revenue Cost of sales Gross profit Other income Selling and distribution costs Administrative expenses Other expenses Finance costs Share of profits of an associate Share of profits of a jointly controlled entity Profit before tax Tax expense Profit for the financial year Attributable to: Equity holders of the Company Minority interests 23 24 22 2009 RM 279,939,456 (254,432,864) 25,506,592 14,747,052 (7,131,802) (7,658,752) (15,580,753) (184,939) 1,565,007 361,749 11,624,154 (2,352,633) 9,271,521 2008 RM 339,947,519 (301,327,015) 38,620,504 4,575,097 (9,025,470) (7,133,532) (8,934,168) (316,940) 2,105,748 189,266 20,080,505 (3,956,549) 16,123,956 2009 RM 19,078,000 19,078,000 865 (427,493) (185,922) 18,465,450 (4,658,540) 13,806,910
Company 2008 RM 35,280,798 35,280,798 34,852 (430,413) (292,303) 34,592,934 (7,616,863) 26,976,071
8,547,156 724,365 9,271,521
15,127,104 996,852 16,123,956
13,806,910 13,806,910
26,976,071 26,976,071
Gross dividends per ordinary share (sen) - First interim dividend - Second interim dividend - Final dividend Earnings per ordinary share attributable to equity holders of the Company (sen) - Basic - Diluted
25 4.50 26 6.00 3.75 4.50 4.50 6.00 3.75 4.50
4.94 4.93
8.58 8.54
Statements Of Changes In Equity

48
Group Balance as at 1 April 2007 Profit for the financial year Dividends in respect of financial year ended 31 March 2008 Dividend to minority interests Issuance of new ordinary shares Repurchase of shares Balance as at 31 March 2008 Profit for the financial year Dividends in respect of financial year ended 31 March 2008 Dividend to minority interests Issuance of new ordinary shares Repurchase of shares Balance as at 31 March 2009
Note
Share capital RM 88,191,800 -
Share premium RM 7,170,391 -
Retained earnings RM 52,401,785 15,127,104
Treasury shares RM -
Total RM 147,763,976 15,127,104
Minority interests RM 4,991,528 996,852
Total equity RM 152,755,504 16,123,956
25
74,848 -
(15,897,234) -
(1,742,065)
(15,897,234) 386,648 (1,742,065)
(136,166) -
(15,897,234) (136,166) 386,648 (1,742,065)
16
311,800 -
88,503,600 -
7,245,239 51,631,655 8,547,156
(1,742,065)145,638,429 8,547,156
5,852,214 151,490,643 724,365 9,271,521
25
21,254 -
(7,811,996) -
(7,811,996) 109,754
(419,500) -
(7,811,996) (419,500) 109,754 (3,778,396)
16
88,500 88,592,100
(3,778,396) (3,778,396) (5,520,461)142,704,947
7,266,493 52,366,815
6,157,079 148,862,026
Statements Of Changes In Equity

For The Financial Year Ended 31 March 2009 (cont`d)
49
Company Balance as at 1 April 2007 Profit for the financial year Dividends in respect of financial year ended 31 March 2008 Issuance of new ordinary shares Repurchase of shares Balance as at 31 March 2008 Profit for the financial year Dividends in respect of financial year ended 31 March 2008 Issuance of new ordinary shares Repurchase of shares Balance as at 31 March 2009
Note
Share capital RM 88,191,800 -
Share premium RM 7,170,391 -
Retained earnings RM 974,214 26,976,071
Treasury shares RM -
Total RM 96,336,405 26,976,071
25 16
311,800 -
74,848 -
(15,897,234) -
(1,742,065)
(15,897,234) 386,648 (1,742,065)
88,503,600 -
7,245,239 -
12,053,051 13,806,910
(1,742,065) -
106,059,825 13,806,910
25 16
88,500 88,592,100
21,254 7,266,493
(7,811,996) 18,047,965
(3,778,396) (5,520,461)
(7,811,996) 109,754 (3,778,396) 108,386,097
Cash Flow Statements

50
Group Note CASH FLOWS FROM OPERATING ACTIVITIES Profit before tax Adjustments for: Inventories written down Amortisation of prepaid lease payments for land Bad debt written off Depreciation of property, plant and equipment Dividend income from quoted investment Gain on disposal of property, plant and equipment Interest expenses Interest income Net unrealised (gain)/loss on foreign exchange Property, plant and equipment written off Share of profits of a jointly controlled entity Share of profits of an associate Operating profit before working capital changes Decrease/(Increase) in inventories Decrease/(Increase) in trade and other receivables (Decrease)/Increase in trade and other payables Cash generated from operations Interest paid Tax paid Tax refunded Net cash from operating activities 11,624,154 20,080,505 18,465,450 2009 RM 2008 RM 2009 RM
Company 2008 RM
34,592,934
8 7
334,932 137,523 4,459,134 (250,000) (24,694) 130,916 (575,885) (908,503) 5,730 (361,749) (1,565,007) 13,006,551 8,176,409 31,997,729 (22,434,911) 30,745,778 (130,916) (3,828,863) 210,346 26,996,345
137,523 25,603 4,418,201 (75,000) (9,433) 280,904 (739,507) 1,181,747 25,555 (189,266) (2,105,748) 23,031,084 (4,914,027) (11,028,244) 7,396,784 14,485,597 (280,904) (5,025,718) 9,178,975
(865) 18,464,585 36,803 18,501,388 (4,769,500) 210,346 13,942,234
(34,852) 34,558,082 6,069 34,564,151 (7,729,729) 26,834,422
Cash Flow Statements

For The Financial Year Ended 31 March 2009 (cont`d)
51
Group Note CASH FLOWS FROM INVESTING ACTIVITIES Dividend received from quoted investment Dividend received from an associate Dividend received from a jointly controlled entity Interest received Advances to a jointly controlled entity Advances from/(Repayments to) subsidiaries Purchase of property, plant and equipment Proceeds from disposal of property, plant and equipment Net cash (used in)/from investing activities CASH FLOWS FROM FINANCING ACTIVITIES Proceeds from issuance of shares Purchase of treasury shares Repayment of short term borrowings Dividends paid to ordinary shareholders Net cash used in financing activities NET INCREASE/(DECREASE) IN CASH AND CASH EQUIVALENTS CASH AND CASH EQUIVALENTS AT BEGINNING OF FINANCIAL YEAR CASH AND CASH EQUIVALENTS AT END OF FINANCIAL YEAR 109,754 (3,778,396) (14,386,088) (18,054,730) 386,648 (1,742,065) (3,925,000) (9,323,142) (14,603,559) 109,754 (3,778,396) (14,386,088) (18,054,730) 250,000 1,500,000 575,885 (9,402) (3,513,885) 58,786 (1,138,616) 75,000 2,400,000 332,000 739,507 (3,609,379) 97,421 34,549 865 4,225,673 4,226,538 2009 RM 2008 RM 2009 RM
Company 2008 RM
34,852 (18,030,232) (17,995,380)
386,648 (1,742,065) (9,323,142) (10,678,559)
7,802,999
(5,390,035)
114,042
(1,839,517)
41,362,243
46,752,278
118,653
1,958,170
15(b)
49,165,242
41,362,243
232,695
118,653
Notes To The Financial Statements

31 March 2009
52
1.
CORPORATE INFORMATION The Company is a public limited liability company, incorporated and domiciled in Malaysia and is listed on the Main Board of Bursa Malaysia Securities Berhad. The registered office of the Company is located at Level 18, The Gardens North Tower, Mid Valley City, Lingkaran Syed Putra, 59200 Kuala Lumpur. The principal place of business of the Company is located at No. 2, Jalan 1, Bandar Sultan Suleiman, Taiwanese Industrial Park, 42000 Port Klang, Selangor Darul Ehsan. The financial statements are presented in Ringgit Malaysia (RM), which is also the Companys functional currency. The financial statements were authorised for issue in accordance with a resolution by the Board of Directors on 30 July 2009.
2.
PRINCIPAL ACTIVITIES The Company is an investment holding company. The principal activities of the subsidiaries are set out in Note 9 to the financial statements. There have been no significant changes in the nature of these activities during the financial year.
3.
BASIS OF PREPARATION The financial statements of the Group and of the Company have been prepared in accordance with applicable approved Financial Reporting Standards (FRSs) in Malaysia and the provisions of the Companies Act, 1965.
4.
SIGNIFICANT ACCOUNTING POLICIES 4.1 Basis of accounting The financial statements of the Group and of the Company have been prepared under the historical cost convention except as otherwise stated in the financial statements. The preparation of financial statements requires the Directors to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue and expenses and disclosure of contingent assets and liabilities. In addition, the Directors are also required to exercise their judgement in the process of applying the accounting policies. The areas involving such judgements, estimates and assumptions are disclosed in Note 6 to the financial statements. Although these estimates and assumptions are based on the Directors best knowledge of events and actions, actual results could differ from those estimates. 4.2 Basis of consolidation The consolidated financial statements incorporate the financial statements of the Company and all its subsidiaries made up to the end of the financial year using the purchase method of accounting. Under the purchase method of accounting, the cost of business combination is measured at the aggregate of fair values at the date of exchange, of assets given, liabilities incurred or assumed, and equity instruments issued plus any costs directly attributable to the business combination.

31 March 2009 (cont`d)
53
4.
SIGNIFICANT ACCOUNTING POLICIES (continued) 4.2 Basis of consolidation (continued) At the acquisition date, the cost of business combination is allocated to identifiable assets acquired, liabilities assumed and contingent liabilities in the business combination which are measured initially at their fair values at the acquisition date. The excess of the cost of business combination over the Groups interest in the net fair value of the identifiable assets, liabilities and contingent liabilities is recognised as goodwill. If the cost of business combination is less than the interest in the net fair value of the identifiable assets, liabilities and contingent liabilities, the Group will: (a) reassess the identification and measurement of the acquirees identifiable assets, liabilities and contingent liabilities and the measurement of the cost of the business combination; and recognise immediately in profit or loss any excess remaining after that reassessment. When a business combination includes more than one exchange transaction, any adjustment to the fair values of the subsidiarys identifiable assets, liabilities and contingent liabilities relating to previously held interests of the Group is accounted for as a revaluation. Subsidiaries are consolidated from the acquisition date, which is the date on which the Group effectively obtains control, until the date on which the Group ceases to control the subsidiaries. Control exists when the Group has the power to govern the financial and operating policies of an entity so as to obtain benefits from its activities. In assessing control, the existence and effect of potential voting rights that are currently convertible or exercisable are taken into consideration. Intragroup balances, transactions and unrealised gains and losses on intragroup transactions are eliminated in full. Intragroup losses may indicate an impairment that requires recognition in the consolidated financial statements. If a subsidiary uses accounting policies other than those adopted in the consolidated financial statements for like transactions and events in similar circumstances, appropriate adjustments are made to its financial statements in preparing the consolidated financial statements. The gain or loss on disposal of a subsidiary, which is the difference between the net disposal proceeds and the Groups share of its net assets as of the date of disposal including the carrying amount of goodwill and the cumulative amount of any exchange differences that relate to the subsidiary, is recognised in the consolidated income statements. Minority interests is that portion of the profit or loss and net assets of a subsidiary attributable to equity interests that are not owned, directly or indirectly through subsidiaries, by the Group. It is measured at the minoritys share of the fair value of the subsidiaries identifiable assets and liabilities at the acquisition date and the minoritys share of changes in the subsidiaries equity since that date. Where losses applicable to the minority in a subsidiary exceed the minoritys interest in the equity of that subsidiary, the excess and any further losses applicable to the minority are allocated against the Groups interest except to the extent that the minority has a binding obligation and is able to make additional investment to cover the losses. If the subsidiary subsequently reports profits, such profits are allocated to the Groups interest until the minoritys share of losses previously absorbed by the Group has been recovered. Minority interest is presented in the consolidated balance sheet within equity and is presented in the consolidated statement of changes in equity separately from equity attributable to equity holders of the Company. Minority interest in the results of the Group is presented in the consolidated income statement as an allocation of the total profit or loss for the financial year between minority interest and equity holders of the Company.
(b)

54
4.
SIGNIFICANT ACCOUNTING POLICIES (continued) 4.3 Property, plant and equipment and depreciation All items of property, plant and equipment are initially measured at cost. Cost includes expenditure that is directly attributable to the acquisition of the asset. Subsequent costs are included in the assets carrying amount or recognised as a separate asset, as appropriate, only when the cost is incurred and it is probable that the future economic benefits associated with the asset will flow to the Group and the cost of the asset can be measured reliably. The carrying amount of parts that are replaced is derecognised. The costs of the day-to-day servicing of property, plant and equipment are recognised in profit or loss as incurred. Cost also comprises the initial estimate of dismantling and removing the asset and restoring the site on which it is located for which the Group is obligated to incur when the asset is acquired, if applicable. Each part of an item of property, plant and equipment with a cost that is significant in relation to the total cost of the asset and which has different useful life, is depreciated separately. After initial recognition, property, plant and equipment are stated at cost less accumulated depreciation and any accumulated impairment losses. Depreciation is calculated to write off the costs of the assets to their residual values on a straight line basis over their estimated useful lives. The principal annual depreciation rates are as follows: Factory buildings Plant, machinery and equipment Office equipment Furniture and fittings Motor vehicles Renovation and installation Canteen equipment 2% 10% 10% 10% 20% 10% 10%
At each balance sheet date, the carrying amount of an item of property, plant and equipment is assessed for impairment when events or changes in circumstances indicate that its carrying amount may not be recoverable. A write down is made if the carrying amount exceeds the recoverable amount (see Note 4.6 to the financial statements on impairment of non-financial assets). 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. If expectations differ from previous estimates, the changes are accounted for as a change in an accounting estimate. The carrying amount of an item of property, plant and equipment is derecognised on disposal or when no future economic benefits are expected from its use or disposal. The difference between the net disposal proceeds, if any, and the carrying amount is included in profit or loss.

55
4.
SIGNIFICANT ACCOUNTING POLICIES (continued) 4.4 Leases (a) Finance leases Assets acquired under finance leases which transfer substantially all the risks and rewards of ownership to the Group are recognised initially at amounts equal to the fair value of the leased property or, if lower, the present value of the minimum lease payments, each determined at the inception of the lease. The discount rate used in calculating the present value of the minimum lease payments is the interest rate implicit in the leases, if this is practicable to determine; if not, the Groups incremental borrowing rate is used. Any initial direct costs incurred by the Group are added to the amount recognised as an asset. The assets are capitalised as property, plant and equipment and the corresponding obligations are treated as liabilities. The property, plant and equipment capitalised are depreciated on the same basis as owned assets. The minimum lease payments are apportioned between the finance charge and the reduction of the outstanding liability. The finance charges are recognised in profit and loss over the period of the lease term so as to produce a constant periodic rate of interest on the remaining lease liabilities. (b) Operating leases A lease is classified as an operating lease if it does not transfer substantially all the risks and rewards incidental to ownership. Lease payments under operating leases are recognised as an expense on a straight-line basis over the lease term. (c) Leases of land and buildings For leases of land and buildings, the land and buildings elements are considered separately for the purpose of lease classification and these leases are classified as operating or finance leases in the same way as leases of other assets. The minimum lease payments including any lump-sum upfront payments made to acquire the interest in the land and buildings are allocated between the land and the buildings elements of the lease in proportion to the relative fair values for the leasehold interests in the land element and the buildings element of the lease at the inception of the lease. Leasehold land that normally has an indefinite economic life and where the lease does not transfer substantially all the risk and rewards incidental to ownership is treated as an operating lease. The lump-sum upfront payments made on entering into or acquiring leasehold land are accounted for as prepaid lease payments and are amortised over the lease term on a straight line basis. The buildings element is classified as a finance or operating lease in accordance with Note 4.4(a) or Note 4.4(b) to the financial statements. If the lease payment cannot be allocated reliably between these two elements, the entire lease is classified as a finance lease, unless it is clear that both elements are operating leases, in which case the entire lease is classified as an operating lease. For a lease of land and buildings in which the amount that would initially be recognised for the land element is immaterial, the land and buildings are treated as a single unit for the purpose of lease classification and is accordingly classified as a finance or operating lease. In such a case, the economic life of the buildings is regarded as the economic life of the entire leased asset.

56
4.
SIGNIFICANT ACCOUNTING POLICIES (continued) 4.5 Investments (a) Subsidiaries A subsidiary is an entity in which the Group and the Company have power to control the financial and operating policies so as to obtain benefits from its activities. The existence and effect of potential voting rights that are currently exercisable or convertible are considered when assessing whether the Group has such power over another entity. An investment in subsidiary, which is eliminated on consolidation, is stated in the Companys separate financial statements at cost less impairment losses, if any. On disposal of such an investment, the difference between the net disposal proceeds and its carrying amount is included in profit or loss. (b) Associates An associate is an entity over which the Group and the Company have significant influence and that is neither a subsidiary nor an interest in a joint venture. Significant influence is the power to participate in the financial and operating policy decisions of the investee but is not in control or joint control over those policies. An investment in associate is accounted for in the consolidated financial statements using the equity method of accounting. The investment in associate in the consolidated balance sheet is initially recognised at cost and adjusted thereafter for the post acquisition change in the Groups share of net assets of the investment. The interest in the associate is the carrying amount of the investment in the associate under the equity method together with any long term interest that, in substance, form part of the Groups net interest in the associate. The Groups share of the profit or loss of the associate during the financial year is included in the consolidated financial statements, after adjustments to align the accounting policies with those of the Group, from the date that significant influence commences until the date that significant influence ceases. Distributions received from the associate reduce the carrying amount of the investment. Adjustments to the carrying amount may also be necessary for changes in the Groups proportionate interest in the associate arising from changes in the associates equity that have not been recognised in the associates profit or loss. Such changes include those arising from the revaluation of property, plant and equipment and from foreign exchange translation differences. The Groups share of those changes is recognised directly in equity of the Group. Unrealised gains and losses on transactions between the Group and the associate are eliminated to the extent of the Groups interest in the associate. When the Groups share of losses in the associate equals to or exceeds its interest in the associate, the carrying amount of that interest is reduced to nil and the Group does not recognise further losses unless it has incurred legal or construction obligations or made payments on its behalf. The most recent available financial statements of the associate are used by the Group in applying the equity method. Where the reporting dates of the financial statements are not coterminous, the share of results is arrived at using the latest audited financial statements for which the difference in reporting dates is no more than three (3) months. Adjustments are made for the effects of any significant transactions or events that occur between the intervening period. Upon disposal of an investment in associate, the difference between net disposal proceeds and its carrying amount is included in profit or loss.

57
4.
SIGNIFICANT ACCOUNTING POLICIES (continued) 4.5 Investments (continued) (c) Jointly controlled entity A jointly controlled entity is a joint venture that involves the establishment of a corporation, partnership or other entities over which there is contractually agreed sharing of joint control over the economic activity of the entity. Joint control exists when strategic financial and operational decisions relating to the activity require the unanimous consent of all the parties sharing control. The investment in jointly controlled entity is accounted for in the consolidated financial statements using the equity method of accounting. The Groups share of the profit or loss of the jointly controlled entity during the financial year is included in the consolidated financial statements, after adjustments to align the accounting policies with those of the Group, from the date that joint control commences until the date that joint control ceases. The Group recognises the portion of gains and losses on the sale of assets by the Group to the joint venture that is attributable to the other venturers. The Group does not recognise its share of profits or losses from the joint venture until it results from the purchase of assets by the Group from the joint venture until it resells the assets to an independent party. However, a loss on the transaction is recognised immediately if the loss provides evidence of a reduction in the net realisable value of current assets or an impairment loss. When necessary, in applying the equity method, adjustments are made to the financial statements of the jointly controlled entity to ensure consistency of accounting policies with those of the Group. Unrealised gains on transactions between the Group and its jointly controlled entity are eliminated to the extent of the Groups interest in the jointly controlled entity; unrealised losses are also eliminated unless the transaction provides evidence on impairment of the asset transferred. Where necessary, in applying the equity method, adjustments are made to the financial statements of the jointly controlled entity to ensure consistency of accounting policies with those of the Group. Upon disposal of such investment, the difference between the net disposal proceeds and its carrying amount is included in profit or loss. (d) Other investment Non-current investment other than investments in subsidiaries, an associate and a jointly controlled entity is stated at cost and an allowance for diminution in value is made where, in the opinion of the Directors, there is a decline other than temporary in value of such investment. Where there has been a decline other than temporary in the value of an investment, such a decline is recognised as an expense in the period in which the decline is identified. Upon disposal of such investment, the difference between net disposal proceeds and its carrying amount is recognised in profit or loss.

58
4.
SIGNIFICANT ACCOUNTING POLICIES (continued) 4.6 Impairment of non-financial assets The carrying amount of assets, except for financial assets (the financial assets in this context do not include investments in subsidiaries, an associate and a jointly controlled entity), inventories and deferred tax assets, are reviewed at each balance sheet date to determine whether there is any indication of impairment. If any such indication exists, the assets recoverable amount is estimated. The recoverable amount of an asset is estimated for an individual asset. Where it is not possible to estimate the recoverable amount of the individual asset, the impairment test is carried out on the cash generating unit (CGU) to which the asset belongs. The recoverable amount of an asset or CGU is the higher of its fair value less cost to sell and its value in use. In estimating the value in use, the estimated future cash inflows and outflows to be derived from continuing use of the asset and from its ultimate disposal 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 future cash flow estimates have not been adjusted. An impairment loss is recognised in profit or loss when the carrying amount of the asset or the CGU exceeds the recoverable amount of the asset or the CGU. The total impairment loss is allocated to the assets of the CGU on a pro-rata basis of the carrying amount of each asset in the CGU. The impairment loss is recognised in profit or loss immediately. An impairment loss for assets is reversed if, and only if, there has been a change in the estimates used to determine the assets recoverable amount since the last impairment loss was recognised. An impairment loss is reversed only to the extent that the assets carrying amount does not exceed the carrying amount that would have been determined, net of depreciation or amortisation, if no impairment loss had been recognised. Such reversals are recognised as income immediately in profit or loss. 4.7 Inventories Inventories are stated at the lower of cost and net realisable value. Cost is determined using the first-in, first-out formula. The cost of raw materials comprises all cost of purchase plus the cost of bringing the inventories to their present location and condition. The cost of work-in-progress and finished goods includes the cost of raw materials, direct labour, other direct cost and a proportion of production overheads based on normal operating capacity of the production facilities. Net realisable value is the estimated selling price in the ordinary course of business, less the estimated costs necessary to make the sale. 4.8 Financial instruments A financial instrument is any contract that gives rise to a financial asset of one enterprise and a financial liability or equity instrument of another enterprise. A financial asset is any asset that is cash, an equity instrument of another enterprise, a contractual right to receive cash or another financial asset from another enterprise, or a contractual right to exchange financial assets or financial liabilities with another enterprise under conditions that are potentially favourable to the Group. A financial liability is any liability that is a contractual obligation to deliver cash or another financial asset to another enterprise, or a contractual obligation to exchange financial assets or financial liabilities with another enterprise under conditions that are potentially unfavourable to the Group.

59
4.
SIGNIFICANT ACCOUNTING POLICIES (continued) 4.8 Financial instruments (continued) 4.8.1 Financial instruments recognised on the balance sheets Financial instruments are recognised on the balance sheet when the Group has become a party to the contractual provisions of the instrument. Financial instruments are classified as liabilities or equity in accordance with the substance of the contractual arrangement. Interest, dividends and losses and gains relating to a financial instrument or a component that is a financial liability shall be recognised as income or expense in profit or loss. Distributions to holders of an equity instrument are debited directly to equity, net of any related tax effect. Financial instruments are offset when the Group has a legally enforceable right to offset and intends to settle on a net basis or to realise the asset and settle the liability simultaneously. (a) Receivables Trade and other receivables, including amounts owing by an associate and related parties, are classified as loans and receivables under FRS 132 Financial Instruments: Disclosure and Presentation. Receivables are carried at anticipated realisable value. Known bad debts are written off and specific allowance is made for debt considered to be doubtful of collection. Receivables are not held for trading purposes. (b) Cash and cash equivalents Cash and cash equivalents include cash and bank balances, bank overdrafts, deposits and other short term, highly liquid investments with original maturities of three (3) months or less, which are readily convertible to cash and which are subject to insignificant risk of changes in value. For the purpose of cash flow statements, cash and cash equivalents are presented net of bank overdrafts. (c) Payables Liabilities for trade and other amounts payable, including any amounts owing to related parties, are initially and subsequently recognised at the consideration to be paid in the future for goods and services received. (d) Interest bearing loans and borrowings All loans and borrowings are initially recognised at the fair value of the consideration received less directly attributable costs, and subsequently measured at amortised cost using effective interest method. (e) Equity instruments Ordinary shares are recorded at the nominal value and proceeds in excess of the nominal value of shares issued, if any, are accounted for as share premium. Both ordinary shares and share premium are classified as equity. Transaction costs of an equity transaction are accounted for as a deduction from equity, net of any related income tax benefit. Otherwise, they are charged to profit or loss. Dividends to shareholders are recognised in equity in the period in which they are declared. If the Company reacquires its own equity instruments, the consideration paid, including any attributable transaction costs is deducted from equity as treasury shares until they are cancelled. No gain or loss is recognised in profit or loss on the purchase, sale, issue or cancellation of the Companys own equity instruments. Where such shares are issued by resale, the difference between the sales consideration and the carrying amount is shown as a movement in equity.

60
4.
SIGNIFICANT ACCOUNTING POLICIES (continued) 4.8 Financial instruments (continued) 4.8.2 Financial instruments not recognised on the balance sheets The Group is a party to financial instruments that comprise foreign currency forward contracts. This instrument is not recognised in the financial statements on inception. (a) Foreign currency forward contracts Foreign currency forward contracts are used to hedge foreign exposures as a result of receipts and payments in foreign currency. Any gains or losses arising from contracts entered into as hedges of anticipated future transactions are deferred until the dates of such transactions at which time they are included in the measurement of such transactions. All other gains or losses relating to hedged instruments are recognised in profit or loss in the same period as the exchange differences on the underlying hedged items. 4.9 Borrowing costs All borrowing costs are recognised in profit or loss in the period in which they are incurred. 4.10 Income taxes Income taxes include all domestic taxes on taxable profit. Taxes in the income statement comprises current tax and deferred tax. (a) Current tax Current tax is the amount of income taxes payable or receivable in respect of the taxable profit or loss for a period. Current tax for the current and prior periods are measured at the amount expected to be recovered from or paid to the taxation authorities. The tax rates and tax laws used to compute the amount are those that have been enacted or substantively enacted by the balance sheet date. (b) Deferred tax Deferred tax is recognised in full using the liability method on temporary differences arising between the carrying amount of an asset or liability in the balance sheet and its tax base. Deferred tax is recognised for all temporary differences, unless the deferred tax arises from the initial recognition of an asset or liability in a transaction which is not a business combination and at the time of transaction, affects neither accounting profit nor taxable profit. A deferred tax asset is recognised only to the extent that it is probable that taxable profits will be available against which the deductible temporary differences, unused tax losses and unused tax credits can be utilised. The carrying amount of a deferred tax asset is reviewed at each balance sheet date. If it is no longer probable that sufficient taxable profit will be available to allow the benefit of part or all of that deferred tax asset to be utilised, the carrying amount of the deferred tax asset will be reduced accordingly. When it becomes probable that sufficient taxable profit will be available, such reductions will be reversed to the extent of the taxable profits.

61
4.
SIGNIFICANT ACCOUNTING POLICIES (continued) 4.10 Income taxes (continued) (b) Deferred tax (contd) 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 the deferred income taxes relate to the same taxation authority. Deferred tax will be recognised as income or expense and included in the profit or loss for the period unless the tax relates to items that are credited or charged, in the same of a different period, directly to equity, in which case the deferred tax will be charged or credited directly to equity. Deferred tax assets and liabilities are measured at the tax rates that are expected to apply to the year when the asset is realised or the liability is settled, based on tax rates and tax laws that have been enacted or substantively enacted by the balance sheet date. 4.11 Provisions Provisions are recognised when there is a present obligation, legal or constructive, as a result of a past event, when it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and a reliable estimate can be made of the amount of the obligation. Where the effect of the time value of money is material, the amount of a provision will be discounted to its present value at a pre-tax rate that reflects current market assessments of the time value of money and the risks specific to the liability. Provisions are reviewed at each balance sheet and adjusted to reflect the current best estimate. If it is no longer probable that an outflow of resources embodying economic benefits will be required to settle the obligation, the provision will be reversed. Provisions are not recognised for future operating losses. If the Group has a contract that is onerous, the present obligation under the contract shall be recognised and measured as a provision. 4.12 Employee benefits 4.12.1 Short term employee benefits Wages, salaries, social security contributions, paid annual leave, paid sick leave, bonuses and nonmonetary benefits are recognised as an expense in the financial year when employees have rendered their services to the Group. Short term accumulating compensated absences such as paid annual leave are recognised as an expense when employees render services that increase their entitlement to future compensated absences. Short term non-accumulating compensated absences such as sick leave are recognised when the absences occur. Bonuses are recognised as an expense when there is a present, legal or constructive obligation to make such payments, as a result of past events and when a reliable estimate can be made of the amount of the obligation.

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4.
SIGNIFICANT ACCOUNTING POLICIES (continued) 4.12 Employee benefits (continued) 4.12.2 Defined contribution plans The Company and its subsidiaries incorporated in Malaysia make contributions to a statutory provident fund. The contributions are recognised as a liability after deducting any contribution already paid and as an expense in the period in which the employees render their services. 4.12.3 Share-based payments The Group operates an equity-settled share-based compensation plan, allowing the employees of the Group to acquire ordinary shares of the Company at predetermined prices. The Group has adopted the transitional provision of FRS 2 in respect of equity instruments granted after 31 December 2004 and not vested on 1 January 2006. 4.13 Foreign currencies 4.13.1 Functional and presentation currency Items included in the financial statements of each of the Groups entities are measured using the currency of the primary economic environment in which the entity operates (the functional currency). The consolidated financial statements are presented in Ringgit Malaysia, which is also the Companys functional and presentation currency. 4.13.2 Foreign currency translations and balances Transactions in foreign currencies are converted into Ringgit Malaysia at rates of exchange ruling at the transaction dates. Monetary assets and liabilities in foreign currencies at the balance sheet date are translated into Ringgit Malaysia at rates of exchange ruling at that date unless hedged by forward foreign exchange contracts, in which case the rates specified in such forward contracts are used. All exchange differences arising from the settlement of foreign currency transactions and from the translation of foreign currency monetary assets and liabilities are included in profit or loss in the period in which they arise. Non-monetary items initially denominated in foreign currencies, which are carried at historical cost are translated using the historical rate as of the date of acquisition, and non-monetary items which are carried at fair value are translated using the exchange rate that existed when the values were determined for presentation currency purposes. 4.14 Revenue recognition Revenue is measured at the fair value of the consideration received or receivable net of discounts and rebates. Revenue is recognised to the extent that it is probable that the economic benefits associated with the transaction will flow to the Group, and the amount of revenue and the cost incurred or to be incurred in respect of the transaction can be reliably measured and specific recognition criteria have been met for each of the Groups activities as follows: (a) Sale of goods Revenue from sale of goods is recognised when significant risk and rewards of ownership of the goods has been transferred to the customer and where the Group retains neither continuing managerial involvement over the goods, which coincides with the delivery of goods and services and acceptance by customers. (b) Services Revenue in respect of the rendering of services is recognised when the stage of completion at the balance sheet date and the cost incurred can be reliably measured. The stage of completion is determined by the services performed to date as a percentage of total services to be performed.

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4.
SIGNIFICANT ACCOUNTING POLICIES (continued) 4.14 Revenue recognition (continued) (c) Dividend income Dividend income is recognised when the right to receive payment is established. (d) Interest and rental income Interest and rental income is recognised on accrual basis. 4.15 Research and development costs Expenditure on development activities of internally developed products is recognised as an intangible asset when it relates to the production of new or substantively improved products and processes and when the Group can demonstrate that it is technically feasible to develop the product or processes, adequate resources are available to complete the development and that there is an intention to complete and sell the product or processes to generate future economic benefits. Development expenditure not satisfying the criteria mentioned and expenditure arising from research or from the research phase of internal projects are recognised in profit or loss as incurred. 4.16 Segment reporting Segment reporting is presented for enhanced assessment of the Groups risks and returns. Business segments provide products or services that are subject to risks and returns that are different from those of other business segments. Geographical segments provide products or services within a particular economic environment that is subject to risks and returns that are different from those components operating in other economic environments. Segment revenue, expense, assets and liabilities are those amounts resulting from the operating activities of a segment that are directly attributable to the segment and the relevant portion that can be allocated on a reasonable basis to the segment. Segment revenue, expense, assets and liabilities are determined before intragroup balances and intragroup transactions are eliminated as part of the consolidation process, except to the extent that such intragroup balances and transactions are between Group enterprises within a single element.
5.
ADOPTION OF NEW FRSs AND AMENDMENT TO FRSs 5.1 Amendment to FRS and new FRSs adopted (a) Amendment to FRS 121 The Effects of Changes in Foreign Exchange Rates - Net Investment in a Foreign Operation is mandatory for annual financial periods beginning on or after 1 July 2007. This amendment results in exchange differences arising from a monetary item that forms part of the Groups net investment in a foreign operation to be recognised in equity irrespective of the currency in which the monetary item is denominated and if whether the monetary item results from a transaction with the Company or any of its subsidiaries. Previously, exchange differences arising from such transactions between the Company and its subsidiaries would be accounted for in the profit or loss or in equity depending on the currency of the monetary item. The adoption of this amendment does not have any material impact on the consolidated financial statements.

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5.
ADOPTION OF NEW FRSs AND AMENDMENT TO FRSs (continued) 5.1 Amendment to FRS and new FRSs adopted (continued) (b) The following FRSs are mandatory for annual financial periods beginning on or after 1 July 2007: FRS 107 FRS 111 FRS 112 FRS 118 FRS 120 FRS 134 FRS 137 Cash Flow Statements Construction Contracts Income Taxes Revenue Accounting for Government Grants and Disclosure of Government Assistance Interim Financial Reporting Provisions, Contingent Liabilities and Contingent Assets
These FRSs align the Malaysian Accounting Standards Board (MASB) FRSs with the equivalent International Accounting Standards (IASs), both in terms of form and content. The adoption of these Standards will only impact the form and content of disclosures presented in the financial statements. FRS 111 and 120 are not relevant to the Groups operations. (c) The following IC Interpretations are mandatory for annual financial periods beginning on or after 1 July 2007: IC Interpretation 1 IC Interpretation 2 IC Interpretation 5 Changes in Existing Decommissioning, Restoration and Similar Liabilities Members Shares in Co-operative Entities and Similar Instruments Rights to Interests arising from Decommissioning, Restoration and Environmental Rehabilitation Funds Liabilities arising from Participating in a Specific Market - WasteElectrical and Electronic Equipment Applying the Restatement Approach under FRS 1292004 Financial Reporting in Hyperinflationary Economies Scope of FRS 2 Share-Based Payment
IC Interpretation 6
IC Interpretation 7
IC Interpretation 8
These IC Interpretations are not relevant to the Groups operations. (d) Framework for the Preparation and Presentation of Financial Statements (Framework) is effective for annual financial periods beginning on or after 1 July 2007. The Framework sets out the concepts that underlie the preparation and presentation of financial statements for external users. It is not a MASB approved FRS as defined in paragraph 11 of FRS 101 Presentation of Financial Statements and hence, does not define standards for any particular measurement or disclosure issue.

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5.
ADOPTION OF NEW FRSs AND AMENDMENT TO FRSs (continued) 5.2 New FRSs not adopted (a) FRS 8 Operating Segments and the consequential amendments resulting from FRS 8 are mandatory for annual financial periods beginning on or after 1 July 2009. FRS 8 sets out the requirements for disclosure of information on an entitys operating segments, products and services, the geographical areas in which it operates and its customers. The requirements of this Standard are based on the information about the components of the entity that management uses to make decisions about operating matters. The Standard requires identification of operating segments on the basis of internal reports that are regularly reviewed by the entitys chief operating decision maker in order to allocate resources to the segment and assess its performance. The Standard also requires the amount reported for each operating segment item to be the measure reported to the chief operating decision maker for the purposes of allocating resources to the segment and assessing its performance. Segment information for prior years that is reported as comparative information for the initial year of application would be restated to conform to the requirements of this Standard. (b) FRS 4 Insurance Contracts and the consequential amendments resulting from FRS 4 are mandatory for annual financial periods beginning on or after 1 January 2010. FRS 4 replaces the existing FRS 2022004 General Insurance Business and FRS 2032004 Life Insurance Business. The Standard applies to all insurance contracts, including reinsurance contracts that an entity issues and to reinsurance contracts that it holds. The Standard prohibits provisions for potential claims under contracts that are not in existence at the reporting date, and requires a test for the adequacy of recognised insurance liabilities and an impairment test for reinsurance assets. The Standard also requires an insurer to keep insurance liabilities in its balance sheet until they are discharged or cancelled, or expire, and to present insurance liabilities without offsetting them against related reinsurance assets. FRS 4 is not relevant to the Groups operations. (c) FRS 7 Financial Instruments: Disclosures and the consequential amendments resulting from FRS 7 are mandatory for annual financial periods beginning on or after 1 January 2010. FRS 7 replaces the disclosure requirements of the existing FRS 132 Financial Instruments: Disclosure and Presentation. The Standard applies to all risks arising from a wide array of financial instruments and requires the disclosure of the significance of financial instruments for an entitys financial position and performance. By virtue of the exemption provided under paragraph 44AB of FRS 7, the impact of applying FRS 7 on the consolidated financial statements upon first adoption of the FRS as required by paragraph 30(b) of FRS 108 Accounting Policies, Change in Accounting Estimates and Errors is not disclosed.

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5.
ADOPTION OF NEW FRSs AND AMENDMENT TO FRSs (continued) 5.2 New FRSs not adopted (continued) (d) FRS 123 Borrowing Costs and the consequential amendments resulting from FRS 123 are mandatory for annual periods beginning on or after 1 January 2010. This Standard removes the option of immediately recognising as an expense borrowing costs that are directly attributable to the acquisition, construction or production of a qualifying asset. However, capitalisation of borrowing costs is not required for assets measured at fair value, and inventories that are manufactured or produced in large quantities on a repetitive basis, even if they take a substantial period of time to get ready for use or sale. The Group does not expect any impact on the consolidated financial statements arising from the adoption of this Standard. (e) FRS 139 Financial Instruments: Recognition and Measurement and the consequential amendments resulting from FRS 139 are mandatory for annual financial periods beginning on or after 1 January 2010. The Standard establishes the principles for the recognition and measurement of financial assets and financial liabilities including circumstances under which hedge accounting is permitted. By virtue of the exemption provided under paragraph 103AB of FRS 139, the impact of applying FRS 139 on the consolidated financial statements upon first adoption of the FRS as required by paragraph 30(b) of FRS 108 Accounting Policies, Change in Accounting Estimates and Errors is not disclosed. (f) Amendments to FRS 2 Share-based Payment: Vesting Conditions and Cancellations are mandatory for annual financial periods beginning on or after 1 January 2010. These amendments clarify that vesting conditions comprise service conditions and performance conditions only. Cancellations by parties other than the Group are accounted for in the same manner as cancellations by the Group itself and features of a share-based payment that are non-vesting conditions are included in the grant date fair value of the share-based payment. The Group does not expect any impact on the consolidated financial statements arising from the adoption of these amendments. (g) Amendments to FRS 1 First-time Adoption of Financial Reporting Standards and FRS 127 Consolidated and Separate Financial Statements: Cost of an Investment in a Subsidiary, Jointly Controlled Entity or Associate is mandatory for annual periods beginning on or after 1 January 2010. These amendments allow first-time adopters to use a deemed cost of either fair value or the carrying amount under previous accounting practice to measure the initial cost of investments in subsidiaries, jointly controlled entities and associates in the separate financial statements. The cost method of accounting for an investment has also been removed pursuant to these amendments. The Group does not expect any impact on the consolidated financial statements arising from the adoption of these amendments.

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5.
ADOPTION OF NEW FRSs AND AMENDMENT TO FRSs (continued) 5.2 New FRSs not adopted (continued) (h) IC Interpretation 9 Reassessment of Embedded Derivatives is mandatory for annual financial periods beginning on or after 1 January 2010. This Interpretation prohibits the subsequent reassessment of embedded derivatives unless there is a change in the terms of the host contract that significantly modifies the cash flows that would otherwise be required by the host contract. The Group does not expect any impact on the consolidated financial statements arising from the adoption of this Interpretation. (i) IC Interpretation 10 Interim Financial Reporting and Impairment is mandatory for annual financial periods beginning on or after 1 January 2010. This Interpretation prohibits the reversal of an impairment loss recognised in a previous interim period in respect of goodwill or an investment in either an equity instrument or a financial asset carried at cost. The Group does not expect any impact on the consolidated financial statements arising from the adoption of this Interpretation. (j) IC Interpretation 11 FRS 2 - Group and Treasury Share Transactions is mandatory for annual periods beginning on or after 1 January 2010. This Interpretation requires share-based payment transactions in which the Company receives services from employees as consideration for its own equity instruments to be accounted for as equity-settled, regardless of the manner of satisfying the obligations to the employees. If the Company grants rights to its equity instruments to the employees of its subsidiaries, this Interpretation requires the Company to recognise the equity reserve for the obligation to deliver the equity instruments when needed whilst the subsidiaries shall recognise the remuneration expense for the services received from employees. If the subsidiaries grant rights to equity instruments of the Company to its employees, this Interpretation requires the Company to account for the transaction as cash-settled, regardless of the manner the subsidiaries obtain the equity instruments to satisfy its obligations. (k) IC Interpretation 13 Customer Loyalty Programmes is mandatory for annual periods beginning on or after 1 January 2010. This Interpretation requires the separation of award credits as a separately identifiable component of sales transactions involving the award of free or discounted goods or services in the future. The fair value of the consideration received or receivable from the initial sale shall be allocated between the award credits and the other components of the sale. If the Group supplies the awards itself, the consideration allocated to the award credits shall only be recognised as revenue when the award credits are redeemed. If a third party supplies the awards, the Group shall assess whether it is acting as a principal or agent in the transaction. If the Group is acting as the principal in the transaction, it shall measure its revenue as the gross consideration allocated to the award credits. If the Group is acting as an agent, it shall measure its revenue as the net amount retained on its own account, and recognise the net amount as revenue when the third party becomes obliged to supply the awards and entitled to receive the consideration for doing so. The Group does not expect any impact on the consolidated financial statements arising from the adoption of this Interpretation.

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5.
ADOPTION OF NEW FRSs AND AMENDMENT TO FRSs (continued) 5.2 New FRSs not adopted (continued) (l) IC Interpretation 14 FRS 119 - The Limit on a Defined Benefit Asset, Minimum Funding Requirements and their Interaction is mandatory for annual periods beginning on or after 1 January 2010. This Interpretation applies to all post-employment defined benefits and other long-term employee defined benefits. This Interpretation clarifies that an economic benefit is available if the Group can realise it at some point during the life of the plan or when the plan liabilities are settled, and that it does not depend on how the Group intends to use the surplus. A right to refund is available to the Group in stipulated circumstances and the economic benefit available shall be measured as the amount of the surplus at the balance sheet date less any associated costs. If there are no minimum funding requirements, the economic benefit available shall be determined as a reduction in future contributions as the lower of the surplus in the plan and the present value of the future service cost to the Group. If there is a minimum funding requirement for contributions relating to the future accrual of benefits, the economic benefit available shall be determined as a reduction in future contributions at the present value of the estimated future service cost less the estimated minimum funding required in each financial year. The Group does not expect any impact on the consolidated financial statements arising from the adoption of this Interpretation.
6.
SIGNIFICANT ACCOUNTING ESTIMATES AND JUDGEMENTS 6.1 Critical judgement made in applying accounting policies There are no critical judgements made by the management in the process of applying the Groups accounting policies that have the most significant effect on the amount recognised in these financial statements. 6.2 Key sources of estimation uncertainty The following are 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. (a) Depreciation of property, plant and equipment The costs of property, plant and equipment are depreciated on a straight-line basis over the assets useful lives. Managements estimation of the useful lives of these property, plant and equipment are as disclosed in Note 4.3 to the financial statements. These are common life expectancies applied in the industry. Changes in the expected level of usage and technological developments could impact the economic useful lives and the residual values of these assets, and therefore future depreciation charges could be revised. (b) Allowance for doubtful debts The Group makes allowance for doubtful debts based on assessment of the recoverability of receivables. Allowances are applied to receivables where events or changes in circumstances indicate that the carrying amounts may not be recoverable. The management specifically analyses historical bad debts, customer concentration, customer creditworthiness, current economic trends and changes in customer payment terms when making a judgement to evaluate the adequacy of allowance for doubtful debts. Where expectations differ from the original estimates, the differences will impact the carrying value of receivables. (c) Write down for obsolete or slow moving inventories The Group writes down its obsolete or slow moving inventories based on assessment of their estimated net selling price. Inventories are written down when events or changes in circumstances indicate that the carrying amounts may not be recoverable. The management specifically analyses sales trend and current economic trends when making a judgement to evaluate the adequacy of the write down for obsolete or slow moving inventories. Where expectations differ from the original estimates, the differences will impact the carrying amount of inventories.

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6.
SIGNIFICANT ACCOUNTING ESTIMATES AND JUDGEMENTS (continued) 6.2 Key sources of estimation uncertainty (continued) (d) Deferred tax assets Deferred tax assets are recognised for all unutilised tax losses to the extent that it is probable that taxable profit will be available against which the losses 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. (e) Other investments The Group makes allowance for diminution in value based on assessment whether the decline in the market value is of permanent in nature together with the assessment on the outlook of the stock exchange. Where expectations differ from the original estimate, the differences will impact the carrying amount of other investment.
7.
PROPERTY, PLANT AND EQUIPMENT Balance as at 1.4.2008 RM Depreciation charge for the financial year RM Balance as at 31.3.2009 RM
Group 2009
Additions RM
Disposals RM
Written off RM
Carrying amount Factory buildings Plant, machinery and equipment Office equipment Furniture and fittings Motor vehicles Renovation and installation Canteen equipment 20,422,971 14,234,669 490,275 75,105 533,961 3,083,906 82,026 38,922,913 4,601 2,304,672 84,059 2,331 1,092,216 26,006 3,513,885 (34,091) (1) (34,092) (3,022) (1,857) (487) (364) (5,730) (487,971) (3,000,382) (113,141) (22,160) (184,988) (628,333) (22,159) (4,459,134) 19,936,579 13,503,011 460,705 55,276 348,973 3,547,789 85,509 37,937,842
[ At 31.3.2009 ] Accumulated Carrying Cost depreciation amount RM RM RM Factory buildings Plant, machinery and equipment Office equipment Furniture and fittings Motor vehicles Renovation and installation Canteen equipment 24,398,685 41,355,337 1,604,078 453,329 1,776,784 8,069,216 238,420 77,895,849 (4,462,106) (27,852,326) (1,143,373) (398,053) (1,427,811) (4,521,427) (152,911) (39,958,007) 19,936,579 13,503,011 460,705 55,276 348,973 3,547,789 85,509 37,937,842

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7.
PROPERTY, PLANT AND EQUIPMENT (continued) Depreciation charge for the financial year RM
Group 2008
Balance as at 1.4.2007 RM
Additions RM
Disposals RM
Written off RM
Carrying amount Factory buildings Plant, machinery and equipment Office equipment Furniture and fittings Motor vehicles Renovation and installation Canteen equipment 20,910,925 14,509,165 544,227 92,771 657,457 3,030,024 100,709 39,845,278 2,816,838 61,031 8,115 74,000 646,685 2,710 3,609,379 (87,988) (87,988) (3,774) (2,066) (19,033) (682) (25,555) (487,954) (2,999,572) (112,917) (25,781) (197,496) (573,770) (20,711) (4,418,201) 20,422,971 14,234,669 490,275 75,105 533,961 3,083,906 82,026 38,922,913
[ At 31.3.2008 ] Accumulated Carrying Cost depreciation amount RM RM RM Factory buildings Plant, machinery and equipment Office equipment Furniture and fittings Motor vehicles Renovation and installation Canteen equipment 24,397,584 39,247,623 1,548,204 450,998 1,830,784 6,977,000 213,364 74,665,557 (3,974,613) (25,012,954) (1,057,929) (375,893) (1,296,823) (3,893,094) (131,338) (35,742,644) 20,422,971 14,234,669 490,275 75,105 533,961 3,083,906 82,026 38,922,913
The carrying amounts of factory buildings of the Group amounted to RM18,710,332 (2008: RM19,163,413) are pledged as securities for credit facilities granted to the subsidiaries as disclosed in Note 21 to the financial statements.

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8.
PREPAID LEASE PAYMENTS FOR LAND Balance as at 1.4.2008 RM Amortisation charge for the financial year RM Balance as at 31.3.2009 RM
Group
Carrying amount Leasehold land 9,200,248 (137,523) 9,062,725
[ At 31.3.2009 ] Accumulated Carrying Cost amortisation amount RM RM RM Leasehold land 9,475,294 (412,569) 9,062,725
Group
Amortisation charge for the financial year RM
Carrying amount Leasehold land 9,337,771 (137,523) 9,200,248
[ At 31.3.2008 ] Accumulated Carrying Cost amortisation amount RM RM RM Leasehold land 9,475,294 (275,046) 9,200,248
Group 2009 RM Analysed as: Long term leasehold land Short term leasehold land 2008 RM
6,428,914 2,633,811 9,062,725
6,504,413 2,695,835 9,200,248

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8.
PREPAID LEASE PAYMENTS FOR LAND (continued) (a) At balance sheet date, the title deed for a piece of leasehold land of a subsidiary with a carrying amount of RM2,186,355 (2008: RM2,210,775) is in the process of being transferred and registered in the subsidiarys name. (b) At balance sheet date, the title deed for a piece of leasehold land of a subsidiary with a carrying amount of RM2,633,811 (2008: RM2,695,835) is registered under the name of a statutory body of the State Government of Kedah, over which a subsidiary has a right for the remaining lease period expiring on 31 May 2050. (c) The carrying amounts of prepaid lease payments for land of the Group amounted to RM8,391,867 (2008: RM8,521,080) are pledged as securities for credit facilities granted to the Group as disclosed in Note 21 to the financial statements.
9.
INVESTMENTS IN SUBSIDIARIES Company 2009 RM Unquoted equity shares, at cost 74,893,666 2008 RM 74,893,666
The details of the subsidiaries, all incorporated in Malaysia, are as follows: Interest in equity held by: Company Subsidiary 2009 2008 2009 2008 % % % % 100 100 -
Name of company
Principal activities
Formosa Prosonic Technics Sdn.Bhd.(FPT)
Manufacture and assembly of speaker units, multi media speaker system and moulded plastic parts Manufacture of chemical paints specialised
Formosa Prosonic Chemicals Sdn. Bhd.
100
100
Formosa Prosonic Equipment Sdn. Bhd. Subsidiary of FPT Aerotronic Sdn. Bhd.
75
75
Manufacture equipment
of
electrical
58.19
58.19
Manufacturing of voice coils and related products for use in speaker units and multimedia speaker systems

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10. INVESTMENT IN A JOINTLY CONTROLLED ENTITY Group 2009 RM Unquoted equity shares, at cost Share of post acquisition reserves, net of dividends received 1,816,048 456,956 2,273,004 2008 RM 1,816,048 95,207 1,911,255
The details of the jointly controlled entity which is incorporated in Malaysia are as follows: Interest in equity held by a subsidiary 2009 2008 % % 50 50
Name of company
Elkay Pacific Rim (Malaysia) Sdn.Bhd.(EPR)
Sale of water coolers and related spare parts
The results of EPR has been accounted for based on the audited financial statements for the financial year ended 31 December 2008 and unaudited management accounts for the financial period from 1 January 2009 to 31 March 2009. The Groups aggregate share of the assets, liabilities and income and expenses of the jointly controlled entity is as follows: 2009 RM Assets and liabilities Current assets Non-current assets Total assets 3,417,797 61,791 3,479,588 2,591,590 68,828 2,660,418 2008 RM
Current liabilities Non-current liabilities Total liabilities
1,114,177 92,407 1,206,584
736,920 12,243 749,163
Results Revenue Expenses, including finance costs and tax expense 5,079,664 4,717,915 5,668,066 5,478,800

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11. INVESTMENT IN AN ASSOCIATE Group 2009 RM Unquoted equity shares, at cost Share of post acquisition reserves, net of dividends received 1,020,000 4,619,193 5,639,193 2008 RM 1,020,000 4,554,186 5,574,186
The details of the associate, which is incorporated in Malaysia, are as follows: Interest in equity held by a subsidiary 2009 2008 % % 30 30
Name of company
Musashi Paint Corporation Sdn. Bhd. (MPC)
Manufacturing and marketing of specialised chemical paints and provision of related consultancy services
The results of MPC have been accounted for based on the audited financial statements for the financial year ended 31 March 2009. The summarised financial information of the associate is as follows:
2009 RM Assets and liabilities Current assets Non-current assets Total assets 15,870,559 6,839,035 22,709,594
2008 RM
17,511,072 4,881,213 22,392,285
Current liabilities Non-current liabilities Total liabilities
3,643,283 269,000 3,912,283
3,677,663 134,000 3,811,663
Results Revenue Profit for the financial year 22,889,813 5,216,690 28,355,055 7,019,160

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12. OTHER INVESTMENT Group 2009 RM Non-current Quoted shares in Malaysia, at cost - shares in a corporation 2008 RM
3,755,630
3,755,630
Market value of quoted shares - shares in a corporation
3,220,000
2,400,000
13. INVENTORIES Group 2009 RM At cost Raw materials Work-in-progress Finished goods 17,379,492 2,513,498 3,768,137 23,661,127 At net realisable value Finished goods 223,557 23,884,684 1,321,000 32,396,025 20,773,287 2,885,594 7,416,144 31,075,025 2008 RM

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14. TRADE AND OTHER RECEIVABLES Group 2009 RM Trade receivables Third parties Jointly controlled entity Associate 35,501,009 2,151,100 3,404,398 41,056,507 Other receivables, deposits and prepayments Subsidiaries Jointly controlled entity Other receivables Deposits Prepayments 30,513 386,506 780,212 161,176 1,358,407 42,414,914 21,111 827,522 71,324 293,779 1,213,736 71,901,386 33,425,332 26,000 1,000 33,452,332 33,452,332 37,651,005 26,000 1,000 37,678,005 37,678,005 68,023,013 1,284,722 1,379,915 70,687,650 2008 RM 2009 RM Company 2008 RM
(a) Trade receivables are non-interest bearing and the normal trade credit terms granted by the Group range from 30 to 120 days (2008: 30 to 120 days) from the date of invoice. (b) Included in trade receivables from third parties of the Group are amounts due from related parties of RM9,482,099 (2008: RM19,025,184). (c) The amount owing by a jointly controlled entity represents trade transactions with trade credit term of 60 days (2008: 60 days) from the date of invoice except for an amount of RM30,513 (2008: RM21,111) representing advances and payments on behalf which are unsecured, interest-free and repayable on demand. (d) The amount owing by an associate represents trade transactions which is unsecured, interest-free and with credit term of 60 days (2008: 60 days) from the date of invoice. (e) The amounts owing by subsidiaries represent advances and payments made on behalf which are unsecured, interest-free and repayable on demand.

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14. TRADE AND OTHER RECEIVABLES (continued) (f) The currency exposure profile of receivables are as follows: Group 2009 RM Ringgit Malaysia US Dollar Japanese Yen Pound Sterling 22,482,155 19,877,388 55,321 50 42,414,914 2008 RM 32,807,377 38,861,415 232,594 71,901,386 2009 RM 33,452,332 33,452,332 Company 2008 RM 37,678,005 37,678,005
(g) Included in deposits of the Group are down payments amounted to RM722,177 (2008: Nil) paid to suppliers for the acquisition of plant and machinery and renovation works. (h) Information on financial risks of trade and other receivables are disclosed in Note 30 to the financial statements.
15. CASH AND CASH EQUIVALENTS Group 2009 RM Cash and bank balances Deposits with licensed banks 13,401,164 35,764,078 49,165,242 2008 RM 11,576,125 30,450,513 42,026,638 2009 RM 232,695 232,695 Company 2008 RM 118,653 118,653
(a) The currency exposure profile of cash and cash equivalents are as follows: Group 2009 RM Ringgit Malaysia US Dollar Japanese Yen 39,434,746 5,855,155 3,875,341 49,165,242 2008 RM 32,801,655 5,913,521 3,311,462 42,026,638 2009 RM 232,695 232,695 Company 2008 RM 118,653 118,653

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15. CASH AND CASH EQUIVALENTS (continued) (b) Cash and cash equivalents included in the cash flow statements comprise the following balance sheet amounts: Group 2009 RM Cash and bank balances Deposits with licensed banks Bank overdraft - secured (Note 21) 13,401,164 35,764,078 49,165,242 2008 RM 11,576,125 30,450,513 (664,395) 41,362,243 2009 RM 232,695 232,695 Company 2008 RM 118,653 118,653
(c) Information on financial risks of cash and cash equivalents are disclosed in Note 30 to the financial statements.
16. SHARE CAPITAL Group and Company 2009 Number of shares Ordinary shares of RM0.50 each: Authorised 400,000,000 200,000,000 400,000,000 200,000,000 RM Number of shares 2008 RM
Issued and fully paid: Balance as at 1 April Share options exercised Balance as at 31 March 177,007,200 177,000 177,184,200 88,503,600 88,500 88,592,100 176,383,600 623,600 177,007,200 88,191,800 311,800 88,503,600
The holders of ordinary shares are entitled to receive dividends as and when declared by the Company and are entitled to one vote per share at meetings of the Company. All ordinary shares rank pari passu with regard to the Companys residual assets. During the financial year, the issued and paid-up ordinary share capital of the Company was increased from RM88,503,600 to RM88,592,100 by way of issuance of 177,000 new ordinary shares of RM0.50 each for cash pursuant to the exercise of the Companys Employees Share Option Scheme (ESOS) at the following option prices: Number of ordinary shares issued 67,000 110,000 Option price per share RM0.612 RM0.625
The abovementioned new shares issued rank pari passu in all respects with the then existing shares of the Company.

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16. SHARE CAPITAL (continued) The Companys ESOS come into effect on 29 October 2004. The main features of the ESOS are as follows: (a) The ESOS is made available to eligible employees and Directors of the Group. (b) The maximum number of new ordinary shares, which may be available under the ESOS, shall not exceed in aggregate fifteen per centum (15%) of the issued and paid-up share capital of the Company at any one time during the duration of the ESOS. (c) The maximum number of new options that may be offered to an eligible person shall be determined at the discretion of the option committee taking into consideration the performance, seniority and length of service of the eligible person and such other factors that the option committee may deem relevant, subject to the following: (i) the aggregate allocation to eligible Directors and senior management shall not exceed fifty per centum (50%) of the new ordinary shares available under the ESOS; and
(ii) the allocation to any eligible person who, either singly or collectively through persons connected to him, hold twenty per centum (20%) or more of the issued and paid-up capital of the Company, shall not exceed ten per centum (10%) of the ordinary shares available under the ESOS. (d) The ESOS shall be in force for a period of five (5) years, unless terminated earlier or extended in accordance with the terms of By-Laws of the ESOS. (e) The price at which the option holders are entitled to subscribe for each new ordinary shares shall be based on the five (5)-day weighted average market price of the Companys shares immediately preceding the offer date of the option, with a discount of not more than ten per centum (10%), or at the par value of the Companys shares, whichever is higher. (f) The new ordinary shares to be allotted upon the exercise of any options granted shall upon allotment and issue, rank pari passu in all respects with the existing issued and paid-up ordinary shares of the Company provided always that the new ordinary shares will not be entitled to any dividends, rights, allotments and/or other distributions, the entitlement date of which is prior to the date of allotment of the said new ordinary shares. The details of the options over ordinary shares of the Company are as follows: Number of options over ordinary shares of RM0.50 each Balance Balance Exercisable as at as at as at 1 April Exercised Lapsed 31 March 31 March
Date of offer 2009 29 October 2004 24 November 2005
Option price
RM0.625 RM0.612
1,018,000 690,800 1,708,800
(110,000) (67,000) (177,000)
(61,000) (61,000)
908,000 562,800 1,470,800
908,000 562,800 1,470,800
Weighted average exercise price (RM)
0.620
0.620
0.612
0.620
0.620

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16. SHARE CAPITAL (continued) Number of options over ordinary shares of RM0.50 each Balance Balance Exercisable as at as at as at 1 April Exercised Lapsed 31 March 31 March
Date of offer 2008 29 October 2004 24 November 2005
Option price
RM0.625 RM0.612
1,423,000 986,400 2,409,400
(385,000) (238,600) (623,600)
(20,000) (57,000) (77,000)
1,018,000 690,800 1,708,800
1,018,000 690,800 1,708,800
Weighted average exercise price (RM)
0.620
0.620
0.615
0.620
0.620
Share options exercised during the financial year resulted in the issuance of 177,000 (2008: 623,600) ordinary shares at an average price of RM0.62 (2008: RM0.62) each. The weighted average market price per ordinary share for the financial year was RM0.83 (2008: RM1.03). 17. TREASURY SHARES The shareholders of the Company, by a special resolution passed in an Extraordinary General Meeting held on 19 September 2007, approved the Companys plan to repurchase up to 10% of the issued and paid-up ordinary share capital of the Company. The Directors of the Company are committed to enhancing the value of the Company to its shareholders and believe that the purchase plan can be applied in the best interests of the Company and its shareholders. During the financial year, the Company purchased 4,612,400 of its issued ordinary share capital from the open market at the average price of RM0.82 per ordinary share. The purchase transactions were financed by internally generated funds. The shares repurchased were retained as treasury shares. As at 31 March 2009, the Group held 6,366,300 (2008: 1,753,900) of the Companys shares. No treasury shares were sold during the financial year. Details of the purchase of treasury shares were as follows: Number of ordinary shares At 1 April 2008 Purchases during the financial year April 2008 May 2008 July 2008 October 2008 November 2008 December 2008 February 2009 March 2009 At 31 March 2009 475,900 1,292,500 47,000 954,000 261,600 105,600 589,600 886,200 6,366,300 446,768 1,227,908 40,113 746,344 209,147 77,261 415,634 615,221 5,520,461 0.95 0.95 0.84 0.80 0.80 0.76 0.70 0.70 0.95 0.92 0.91 0.84 0.72 0.79 0.70 0.70 0.66 0.66 0.93 0.94 0.84 0.78 0.80 0.73 0.70 0.69 0.87 1,753,900 Purchase Price Per Ordinary Share Cost Highest Lowest Average RM RM RM RM 1,742,065 1.00 0.94 0.99

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18. RESERVES Group 2009 RM Non-distributable: Share premium Distributable: Retained earnings 52,366,815 59,633,308 51,631,655 58,876,894 18,047,965 25,314,458 12,053,051 19,298,290 7,266,493 7,245,239 7,266,493 7,245,239 2008 RM 2009 RM Company 2008 RM
(a) Retained earnings Effective from 1 January 2008, the Company is given the option to make an irrecoverable election to move to a single tier system or continue to use its tax credit under Section 108 of the Income Tax Act, 1967 for the purpose of dividend distribution until the tax credit is fully utilised or latest, by 31 December 2013. The Company has made this election and as a result, there are no longer any restrictions on the Company to frank the payment of dividends out of its entire retained earnings as at the balance sheet date.
19. DEFERRED TAX LIABILITIES (a) The deferred tax liabilities after appropriate offsetting are made up of the following: Group 2009 RM Balance as at 1 April Recognised in the income statement (Note 24) Balance as at 31 March 3,027,000 384,300 3,411,300 2008 RM 3,353,000 (326,000) 3,027,000

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19. DEFERRED TAX LIABILITIES (continued) (b) The components and movements of deferred tax assets and liabilities during the financial year prior to offsetting are as follows: Deferred tax assets of the Group Other temporary differences RM 321,000 (298,000) 23,000
Unutilised tax losses RM As at 1 April 2008 Recognised in the income statement As at 31 March 2009 53,000 (53,000) -
Total RM 374,000 (351,000) 23,000
As at 1 April 2007 Recognised in the income statement As at 31 March 2008
53,000 53,000
191,000 130,000 321,000
191,000 183,000 374,000
Deferred tax liabilities of the Group Property, plant and equipment RM As at 1 April 2008 Recognised in the income statement As at 31 March 2009 3,365,000 (181,000) 3,184,000 Other temporary differences RM 36,000 214,300 250,300
Total RM 3,401,000 33,300 3,434,300
As at 1 April 2007 Recognised in the income statement As at 31 March 2008
3,518,000 (153,000) 3,365,000
26,000 10,000 36,000
3,544,000 (143,000) 3,401,000

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20. TRADE AND OTHER PAYABLES Group 2009 RM Trade payables Third parties Other payables Other payables Accruals 2,291,853 2,104,630 4,396,483 24,859,653 2,589,374 2,483,850 5,073,224 45,281,712 50,528 339,400 389,928 389,928 6,625 346,500 353,125 353,125 20,463,170 40,208,488 2008 RM 2009 RM Company 2008 RM
(a) Trade payables are non-interest bearing and the normal trade credit terms granted to the Group range from 30 to 90 days (2008: 30 to 90 days) from the date of invoice. (b) Included in trade payables from third parties of the Group and other payables of the Group are amounts due from related parties of RM3,081,423 (2008: RM3,978,340) and RM424,491 (2008: RM308,951) respectively. (c) Information on financial risks of trade and other payables are disclosed in Note 30 to the financial statements. (d) The currency exposure profile of payables are as follows: Group 2009 RM Ringgit Malaysia US Dollar Japanese Yen Pound Sterling New Taiwan Dollar Singapore Dollar 14,877,319 9,169,953 783,471 7,710 21,200 24,859,653 2008 RM 28,916,575 14,099,129 2,101,973 6,859 157,176 45,281,712 2009 RM 389,928 389,928 Company 2008 RM 353,125 353,125

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21. BORROWING (SECURED) Group 2009 RM Bank overdraft 2008 RM 664,395
The bank overdraft is secured by: (i) a charge over the leasehold land and factory buildings of the subsidiaries (Note 7 and 8);
(ii) a debenture over the present and future assets of a subsidiary; and The bank overdraft is also jointly and severally guaranteed by all individual shareholders of a subsidiary. Information on financial risks of borrowing and its remaining maturity is disclosed in Note 30 to the financial statements.
22. REVENUE Group 2009 RM Sale of goods Services rendered Dividend income from subsidiaries 279,867,042 72,414 279,939,456 2008 RM 339,815,805 131,714 339,947,519 2009 RM 19,078,000 19,078,000 Company 2008 RM 35,280,798 35,280,798

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23. PROFIT BEFORE TAX Group Note Profit before tax is arrived at after charging: Amortisation of prepaid lease payments for land Auditors remuneration: - current year (statutory) - over provision in prior year Bad debt written off Depreciation of property, plant and equipment Directors remuneration: - Company: - fees - emoluments other than fees - Subsidiaries: - emoluments other than fees Interest expenses on: - bankers acceptances - overdraft - others Management fee expense Property, plant and equipment written off Inventories written down Realised loss on foreign exchange Rental of premises Research and development costs Unrealised loss on foreign exchange 2009 RM 2008 RM 2009 RM Company 2008 RM
137,523 101,800 (9,750) 4,459,134
137,523 111,550 25,603 4,418,201
21,000 (2,000) -
23,000 -
255,000 1,209,068 541,338 19,155 2,338 109,423 5,730 334,932 11,401,210 183,009 767,690 1,565,694
255,000 845,892 516,044 133,802 8,890 138,212 60,000 25,555 2,891,816 207,945 417,113 1,421,978
255,000 63,400 -
255,000 68,500 -
And after crediting: Dividend income from: - subsidiaries - quoted investment Gain on disposal of property, plant and equipment Interest income Management fee income Realised gain on foreign exchange Rental income Unrealised gain on foreign exchange
250,000 24,694 575,885 11,276,033 15,900 2,474,197
75,000 9,433 739,507 90,000 1,204,916 15,900 240,231
19,078,000 865 -
35,280,798 34,852 -
The estimated monetary value of benefits-in-kind other than in cash received or receivable by the Directors from the Company and the Group amounted to RM35,256 (2008: RM56,870) and RM87,380 (2008: RM78,600) respectively.

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24. TAX EXPENSE Group 2009 RM Current tax expense - Based on profit for the financial year - Under/(Over) provision in prior years 2008 RM 2009 RM Company 2008 RM
1,915,846 52,487 1,968,333
4,385,196 (102,647) 4,282,549
4,680,299 (21,759) 4,658,540
7,643,358 (26,495) 7,616,863
Deferred tax (Note 19) - Relating to origination and reversal of temporary differences - Relating to changes in tax rates - Over provision in prior years
466,800 (82,500) 384,300 2,352,633
(186,000) (128,000) (12,000) (326,000) 3,956,549
4,658,540
7,616,863
The numerical reconciliation between the average effective tax rate and the applicable tax rate of the Group and of the Company are as follows: Group 2009 % Applicable tax rate Tax effect in respect of: Non-allowable expenses Utilisation of previously unrecognised deferred tax assets Tax exempt dividend income Tax incentives and allowances Effect of change in tax rate on opening balances of deferred tax Tax effect on share of results in: - an associate - a jointly controlled entity 2.9 1.8 0.3 0.3 25.0 2008 % 26.0 2009 % 25.0 Company 2008 % 26.0
(0.5) (2.7)
(1.5) (0.1) (2.4)
(4.2) -
(0.6)
(3.4) (0.8) 20.5
(2.7) (0.2) 20.3 (0.6) 19.7
25.3 (0.1) 25.2
22.1 (0.1) 22.0
Under/(Over) provision in prior years - tax expense - deferred tax Average effective tax rate
0.4 (0.7) 20.2

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24. TAX EXPENSE (continued) Tax savings of the Group are as follows: Group 2009 RM Arising from utilisation of previously unrecognised tax losses 2008 RM 297,600
25. DIVIDENDS Group and Company 2009 Gross dividend per ordinary share sen Final single tier tax exempt dividend in respect of financial year ended 31 March 2008 First interim dividend, less tax in respect of financial year ended 31 March 2008 First interim tax exempt dividend in respect of financial year ended 31 March 2008 Second interim single tier tax exempt dividend in respect of financial year ended 31 March 2008 Amount of dividend, net of tax RM Gross dividend per ordinary share sen 2008 Amount of dividend, net of tax RM
4.50
7,811,996
2.80
3,664,179
3.20
5,658,963
4.50
7,811,996
3.75 9.75
6,574,092 15,897,234
The first interim single tier dividend in respect of the financial year ended 31 March 2009 of approximately 4.5 sen per ordinary share amounted to RM7,692,881 has been declared by the Directors after the balance sheet date. The financial statements for the current financial year do not reflect this dividend. This dividend will be accounted for as an appropriation of retained earnings in the financial year ending 31 March 2010.

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26. EARNINGS PER ORDINARY SHARE (a) Basic earnings per ordinary share: Basic earnings per ordinary share for the financial year is calculated by dividing the profit for the financial year attributable to ordinary equity holders of the Company by the weighted average number of ordinary shares outstanding (adjusting for treasury shares) during the financial year.
Group 2009 2008
Profit attributable to equity holders of the Company (RM)
8,547,156
15,127,104
Weighted average number of ordinary shares outstanding (adjusted for treasury shares)
173,084,785
176,290,532
Basic earnings per ordinary share (sen)
4.94
8.58
(b) Diluted earnings per ordinary share: Diluted earnings per ordinary share for the financial year is calculated by dividing the profit for the financial year attributable to the ordinary equity holders of the Company by the weighted average number of ordinary shares which would be issued on conversion of all dilutive potential ordinary shares into ordinary shares. The weighted average number of ordinary shares outstanding plus the weighted average number of ordinary shares which would be issued on conversion of all dilutive potential ordinary shares into ordinary shares is calculated as follows: Group 2009 Weighted average number of ordinary shares outstanding (adjusted for treasury shares) Weighted average number of ordinary shares deemed to have been issued during the current financial year for no consideration upon exercise of ESOS Weighted average number of ordinary shares for diluted earnings per ordinary share 2008
173,084,785
176,290,532
380,934 173,465,719
796,787 177,087,319
Diluted earnings per ordinary share (sen)
4.93
8.54

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27. EMPLOYEE BENEFITS Group 2009 RM Salaries, wages and bonuses Defined contribution plan Other employee benefits 22,788,144 1,765,277 2,126,316 26,679,737 2008 RM 25,954,292 2,096,512 4,261,825 32,312,629 2009 RM 63,400 63,400 Company 2008 RM 68,500 68,500
Included in the employee benefits of the Group and of the Company are Directors remuneration amounting RM1,750,406 (2008: RM1,361,936) and RM63,400 (2008: RM68,500) respectively.
28. RELATED PARTY DISCLOSURES (a) Identities of related parties Parties are considered to be related to the Group if the Group has the ability, directly or indirectly, to control the party or exercise significant influence over the party in making financial and operating decisions, or vice versa, or where the Group and the party are subject to common control or common significant influence. Related parties may be individuals or other parties. The Group has controlling related party relationships with its direct and indirect subsidiaries. (i) The Group also has related party relationships with the following parties: Identities of related parties Formosa Prosonic Holdings Sdn. Bhd. (FPH) Formosa Prosonic Industries Berhad (FPI) Relationship A corporate shareholder A company with significant influence over the Company through its wholly-owned subsidiary, FPM (as defined below) A corporate shareholder, which is wholly-owned by FPI, with significant influence over the Company A subsidiary of FPI A subsidiary of FPI A subsidiary of FPI A subsidiary of FPI A jointly controlled entity An associate
Formosa Prosonic Manufacturing Sdn. Bhd. (FPM)
Energistic Sdn. Bhd. (Energistic) Asia Pacific Card & System Sdn. Bhd. (APCS) FP Group Limited (FPG) Acoustic Energy Limited (AE) Elkay Pacific Rim (Malaysia) Sdn. Bhd. (EPR) Musashi Paint Corporation Sdn. Bhd. (MPC)
(ii) Key management personnel which comprises persons (including the Directors of the Company) having authority and responsibility of planning, directing and controlling the activities of the Group directly or indirectly.

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28. RELATED PARTY DISCLOSURES (continued) (b) In addition to the transactions detailed elsewhere in the financial statements, the Group and the Company had the following transactions with the related parties during the financial year: Group 2009 RM Associate: Commission payable Purchase of products Purchase of property, plant and equipment Sales of products Sales proceeds from disposal of property, plant and equipment Rental income Related parties: Management fee paid Management fee received Purchases of products Sales of products Sub-contract income received Subsidiaries: Gross dividend received from subsidiaries 2008 RM 2009 RM Company 2008 RM
2,143,368 4,918,338 12,200 8,072,718 15,900
2,795,026 6,717,998 16,000 12,497,135 30,221 15,900
24,831,067 77,604,675 43,610
60,000 90,000 7,137,950 101,473,205 54,265
19,078,000
35,280,798
The related party transactions described above will carried out on negotiated terms and conditions. Balances of the above related parties are disclosed in Note 14 and 20 to the financial statements.
29. SEGMENT REPORTING (a) Reporting format Segment information is presented in respect of the Groups business segments, which is based on the Groups management and internal reporting structure. The primary segment reporting format is determined to be business segments as the Groups risks and returns are affected predominantly by differences in the products and services produced. Secondary information is reported geographically.

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29. SEGMENT REPORTING (continued) (b) Business segments The Groups operations comprise the following business segments: (i) Audio division Manufacturing, assembly and sales of speaker units and multimedia speaker systems, including component parts. (ii) Chemical division Manufacturing and sales of specialised chemical paints. (iii) Electrical equipment division Manufacturing and distribution of electrical equipment. (c) Geographical segments The Group operates wholly in Malaysia. The revenue disclosed in geographical segments is based on the geographical location of its customers. The composition of each geographical segment is as follows: (i) Malaysia : Manufacturing, assembly and sales of speaker units and multimedia speaker systems, including component parts, manufacturing and sales of specialised chemical paints, manufacturing and distribution of electrical equipment and investment holding. Sales of speaker units and multimedia speaker systems, including component parts and sales of specialised chemical paints. Sales of speaker units and multimedia speaker systems, including component parts and distribution of electrical equipment.
(ii) Asia
(iii) North America : and Europe
The following table provides an analysis of the Groups revenue, results, assets, liabilities and other information by business segment: Electrical equipment division RM
2009
Audio division RM
Chemical division RM
Total RM
Revenue External segment revenue 185,698,878 33,011,204 61,229,374 279,939,456
Results Segment results (external) Unallocated corporate expenses Interest income Finance costs Share of profits of an associate Share of profits of a jointly controlled entity Profit before tax Tax expense Profit for the financial year 1,659,039 5,417,530 2,843,298 9,919,867 (613,415) 575,885 (184,939) 1,565,007 361,749 11,624,154 (2,352,633) 9,271,521
1,565,007 -
361,749

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29. SEGMENT REPORTING (continued) Audio division RM Chemical division RM Electrical equipment division RM
2009
Total RM
Assets Segment assets Investment in a jointly controlled entity Investment in an associate Other investment Current tax assets Deposits with licensed banks Unallocated corporate assets Total assets 65,430,731 27,438,594 5,639,193 3,755,630 33,572,309 2,273,004 126,441,634 2,273,004 5,639,193 3,755,630 3,064,301 35,764,078 259,695 177,197,535
Segment liabilities Current tax payable Deferred tax liabilities Unallocated corporate liabilities Total liabilities
10,952,374
1,211,287
12,306,064
24,469,725 64,556 3,411,300 389,928 28,335,509
Capital expenditure Depreciation of property, plant and equipment Amortisation of prepaid lease payment for land Non cash expenses other than depreciation and amortisation
1,836,926 3,022,606 104,793 767,111
812,010 463,404 8,310 2,041
864,949 973,124 24,420 802,272
3,513,885 4,459,134 137,523 1,571,424

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29. SEGMENT REPORTING (continued) The following table provides an analysis of the Groups revenue, results, assets, liabilities and other information by business segment (continued) : Audio division RM Chemical division RM Electrical equipment division RM
2008 Revenue External segment revenue Results Segment results (external) Unallocated corporate expenses Interest income Finance costs Share of profits of an associate Share of profits of a jointly controlled entity Profit before tax Tax expense Profit for the financial year Assets Segment assets Investment in a jointly controlled entity Investment in an associate Other investment Current tax assets Deposits with licensed banks Unallocated corporate assets Total assets Segment liabilities Current tax payable Deferred tax liabilities Dividend payable Borrowing (secured) Unallocated corporate liabilities Total liabilities Capital expenditure Depreciation of property, plant and equipment Amortisation of prepaid lease payment for land Non cash expenses other than depreciation and amortisation
Total RM
204,941,752
45,806,633
89,199,134
339,947,519
6,044,144
10,704,660
1,336,835
2,105,748 -
189,266
18,085,639 (722,715) 739,507 (316,940) 2,105,748 189,266 20,080,505 (3,956,549) 16,123,956
87,921,102 -
28,766,456 5,574,186 3,755,630
47,163,486 1,911,255 -
163,851,044 1,911,255 5,574,186 3,755,630 1,530,631 30,450,513 145,653 207,218,912
22,457,818
2,834,225
19,636,544
44,928,587 181,070 3,027,000 6,574,092 664,395 353,125 55,728,269
1,973,043 3,033,682 104,793 670,588
764,308 418,685 8,310 21,132
872,028 965,834 24,420 781,416
3,609,379 4,418,201 137,523 1,473,136

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29. SEGMENT REPORTING (continued) The following table provides an analysis of the Groups revenue by geographical segment: Group 2009 RM Revenue Malaysia Asia North America and Europe 2008 RM
172,706,044 36,563,120 70,670,292 279,939,456
207,869,745 38,620,176 93,457,598 339,947,519
All the assets and capital expenditure of the Group are located within Malaysia.
30. FINANCIAL INSTRUMENTS (a) Financial risk management objectives and policies The operations of the Group are subject to a variety of financial risks, including market risk, credit risk, foreign currency risk, interest rate risk and liquidity risk. The Groups overall financial risk management objective is to ensure that the Group creates value for its shareholders while minimising potential adverse effects on the financial performance of the Group. Various risk management policies are in place to control and manage risks associated with financial instruments. Financial instruments such as trade receivables, other receivables and deposits, trade payables, other payables and accruals, and borrowing arose directly from the Groups operations. It is, and has been throughout the period under review, the Groups policy that no trading or speculation in financial instruments shall be undertaken. The policies for managing each of these risks are summarised below: (i) Market risk The Group is exposed to market risk arising from changes in the market prices of its quoted investment. The Group does not use derivative instruments to manage this risk as the quoted investment is held as long term investment. (ii) Credit risk Credit risk is the potential risk of financial loss from the failure of a customer or counterparty to settle their financial and contractual obligations to the Group, as and when they fall due. As at 31 March 2009, the Group has trade receivables of approximately RM3,992,227 (2008: RM11,209,237) which have been outstanding for more than their respective credit terms granted. The Directors believe that any material loss in the event of non-performance by these counter parties to be unlikely. At balance sheet date, the Company has significant exposure in respect of amount owing by subsidiaries amounting to RM33,425,332 (2008: RM37,651,005). Other than as mentioned, the Group has no significant concentration of credit risk. The maximum exposures to credit risk are represented by the carrying amounts of the financial assets in the balance sheets. Other financial assets of the Group with exposure to credit risk include cash and fixed deposits, which are placed with financial institutions with good standing.

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30. FINANCIAL INSTRUMENTS (continued) (a) Financial risk management objectives and policies (continued) (iii) Foreign currency risk The Group is subject to foreign exchange fluctuations through the import of raw materials and export of finished goods. The Group periodically uses foreign currency forward contracts to protect against the volatility associated with foreign currency transactions for receivables denominated in currencies other than the functional currency of the Group. In the previous financial year, the notional amount of the foreign currency forward contracts with maturity date of less than 1 year and outstanding as at balance sheet date are as follows: Total notional amount Group 2008 Sales contracts used to hedge USD sale proceeds receivables RM
38,016,000
Unrecognised profit
356,300
The unrecognised profit as at end of the financial year on the foreign currency forward contracts are deferred and will be recognised when the related underlyings are transacted, at which time they are included in the measurement of the transactions. The Group does not have any outstanding foreign currency forward contract as at 31 March 2009. (iv) Interest rate risk The Groups exposure to market risk for changes in interest rates relates primarily to the Groups interest-bearing bank borrowing and interest-earning fixed deposits placed with licensed banks. The Group does not use derivative financial instruments to hedge its risk.

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30. FINANCIAL INSTRUMENTS (continued) (a) Financial risk management objectives and policies (continued) (iv) Interest rate risk (continued) The following tables set out the carrying amounts, the average effective interest rates as at the balance sheet date and the remaining maturities of the Groups and the Companys financial instruments that are exposed to interest rate risk: Average effective interest rate per annum %
Note Group At 31 March 2009 Fixed rate instruments Deposits with licensed banks 15
Within 1 year RM
1.50
35,764,078
At 31 March 2008 Fixed rate instruments Deposits with licensed banks 15 2.87 30,450,513
Floating rate instruments Bank overdraft - secured 21 8.00 (664,395)
(v) Liquidity risk Liquidity risk is the risk that the Group is unable to service its cash obligations in the future. To mitigate this risk, the management monitors and maintains a level of cash and cash equivalents deemed adequate to finance the Groups operations and development activities.

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30. FINANCIAL INSTRUMENTS (continued) (b) Fair values The carrying amounts of the financial instruments of the Group and of the Company as at balance sheet date approximate their fair values due to relatively short term maturity of the financial instruments except as set out below: Group Carrying amount RM At 31 March 2009 Recognised Quoted investment Fair value RM
3,755,630
3,220,000
At 31 March 2008 Recognised Quoted investment
3,755,630
2,400,000
Unrecognised Foreign currency forward contracts - Sale contracts
356,300
The methods and assumptions used by management to determine fair values of the financial instruments are as follows: (i) Other investment - Quoted investment in Malaysia The fair value of quoted investments in Malaysia is determined by reference to the stock exchange quoted market bid prices at the close of the business on the balance sheet date. (ii) Foreign currency forward contracts The fair value of a forward foreign exchange contract is the amount that would be payable or receivable upon termination of the outstanding position arising and is determined by reference to the difference between the contracted rate and the forward exchange rate as at the balance sheet date applied to a contract of similar amount and maturity profile.

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31. CAPITAL COMMITMENTS Group 2009 RM Authorised capital expenditure not provided for in the financial statements - Contracted - Purchase of property, plant and equipment - Approved but not contracted for - Purchase of property, plant and equipment 2008 RM
1,685,080
310,400
3,634,805 5,319,885
310,400
32. SIGNIFICANT EVENT SUBSEQUENT TO THE BALANCE SHEET DATE On 19 May 2009, Formosa Prosonic Chemicals Sdn. Bhd., a wholly-owned subsidiary of the Company had disposed off the entire equity interest of 30% of Musashi Paint Corporation Sdn. Bhd., which comprised 1,500,000 ordinary shares of RM1.00 each for a total consideration of RM5,700,000. The consideration was arrived at willing buyer willing seller basis.
Analysis Of Shareholdings
As At 24 July 2009
99
SHARE CAPITAL Authorised Issued & Fully Paid-Up Class of Shares Voting Rights Size of Shareholding Less than 100 shares 100 - 1,000 shares 1,001 - 10,000 shares 10,001 - 100,000 shares 100,001 to less than 5% of issued shares 5% and above of issued shares TOTAL : : : : RM200,000,000 RM88,659,600 Ordinary shares of RM0.50 each One vote per ordinary share No. of Shareholders 47 392 3,250 1,001 117 2 4,809 % of Shareholders 0.98 8.15 67.58 20.82 2.43 0.04 100.00 No. of Shares 2,494 350,652 15,487,638 30,245,090 72,018,380 52,848,646 170,952,900 % of Shareholdings 0.00 0.21 9.06 17.69 42.13 30.91 100.00
Excluding a total of 6,366,300 treasury shares bought back. SUBSTANTIAL SHAREHOLDERS Name 1) 2) Formosa Prosonic Manufacturing Sdn Bhd Huang Huai Son Direct No. of Shares 42,295,914 10,552,732 52,848,646 Percentage 24.74 6.17 30.91 Indirect No. of Shares Percentage -
TOTAL DIRECTORS' INTEREST Name 1) 2) 3) 4) 5) 6) 7) 8) Huang Huai Son Chen Po Hsiung Su Cheng Tao Shih Chao Yuan Chang Song Hai Soon Kwai Choy Dato' Nik Abdul Aziz Bin Mohamed Kamil (Shares held under Bimsec Nominees (Tempatan) Sdn Bhd) Leong Ngai Seng
Direct No. of Shares 10,552,732 7,209,876 1,505,956 1,854,290 400,000 400,000 400,000 350,000 22,672,854
Percentage* 6.17 4.22 0.88 1.08 0.23 0.23 0.23 0.20 13.24
Indirect No. of Shares 265,846 43,735,914 610,000 44,611,760
Percentage* 0.16 25.58 0.36 26.10
TOTAL
* Excluding a total of 6,366,300 treasury shares bought back.
Analysis Of Shareholdings
As At 24 July 2009 (cont`d)
100
LIST OF TOP 30 SHAREHOLDERS Name 1) 2) 3) 4) 5) 6) 7) 8) 9) Formosa Prosonic Manufacturing Sdn Bhd Huang Huai Son Chen Shan Ching Chen Po Hsiung Yeoh Kean Hua Formosa Prosonic Holdings Sdn Bhd Wang Chun Cheng Wu Swee Ngor Shih Chao Yuan No. of Shares Held 42,295,914 10,552,732 7,929,880 7,209,876 6,700,000 3,746,560 3,588,000 1,971,974 1,854,290 1,505,956 1,478,000 1,440,000 1,400,000 1,230,238 1,189,726 1,163,812 1,157,882 1,100,000 1,044,000 1,042,596 1,000,000 900,000 847,442 820,160 614,600 610,000 594,600 580,500 572,300 554,800 106,695,838 Percentage 24.74 6.17 4.64 4.22 3.92 2.19 2.10 1.15 1.08 0.88 0.86 0.84 0.82 0.72 0.70 0.68 0.68 0.64 0.61 0.61 0.58 0.53 0.50 0.48 0.36 0.36 0.35 0.34 0.33 0.32 62.40
10) Su Cheng Tao 11) C.L.P. Industries Sdn Bhd 12) Shih Huang Shiu Fang 13) Johan Enterprise Sdn Bhd 14) Dian Pujangga Sdn Bhd 15) Chang Wen Lung 16) Lam Choi Wan 17) Wang Wei Nan 18) Tan Poay Jong 19) Musashi Paint Corporation Sdn Bhd 20) Chen Ching Sen 21) Su Mei Ying 22) Tang Chun Yong 23) Peng Liu Mei 24) Liao Chang Pi Hua 25) Tay Kak Chok 26) Teoh Bee Yong 27) Cartaban Nominees (Tempatan) Sdn Bhd OSK Trustees Berhad For CMS Absolute Return Fund 28) Kam Chooi Suan 29) Leong Kok Tai 30) Federlite Holdings Sdn Bhd TOTAL
Location
Description
Tenure
Valuation/ Acquisition/ Completion Date 15/6/2001 27/4/2000 17 For Factory 13 188,217 106,064 10,970,163 For Office
Approximate Age of Building (Years)
Approximate Site Area (Sq.Ft.)
Built-up/ Lettable Area (Sq.Ft.)
Net Book Existing Use Value (RM)
Four Storey Office Block
No. 2 Lebuh 1 Bandar Sultan Suleiman Taiwanese Industrial Park 42000 Port Klang Selangor Darul Ehsan 27/4/2000 13 For Factory
As At 31 March 2009
Single Storey Factory (Old)
Leasehold (99 years Expiring 30/12/2093)
Single Storey Factory (New) 15/6/2001 15
List Of Properties
Single Storey Sports Hall
For Recreation For Meal and Drinks For Storage of Containers For Security For Electricity Supply 423,797 121,008 10,311,687 For Office Cum Factory
Single Storey Canteen
15/6/2001
15
Container Yard
15/6/2001
15
Single Storey Guardhouse And TNB Station 15/6/2001 15
15/6/2001
15
Plot 236,238 & 240 Kawasan Perusahaan LPK Taman Ria Jaya 08000 Sungai Petani Kedah Darul Aman Leasehold (99 years expiring 30/12/2093) 27/4/2000 19
Double Storey Office Block Location At the Front Portion And A Connecting Single Storey Factory
Leasehold (60 years Expiring 30/12/2050)
June 2000
No. 2 Jalan 1 Bandar Sultan Suleiman Taiwanese Industrial Park 42000 Port Klang Selangor Darul Ehsan Leasehold (95 years expiring 30/6/2091) July 1996
55,684
19,144
1,897,114
For Office Cum Factory
No. 11, Jalan Sultan Mohamed 5 Bandar Sultan Suleiman Taiwanese Industrial Park 42000 Port Klang Selangor Darul Ehsan
14
130,634
55,170
5,820,340
For Office Cum Factory
101
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Acoustech Berhad
(Company No. 496665-W)
(Incorporated in Malaysia under the Companies Act, 1965)
PROXY FORM
I/We, ............ I.C./Passport/Company No. ..... of ......................................... being a member of ACOUSTECH BERHAD, do hereby appoint ............... ....................... I.C. / Passport No. ........... of ............................................ or failing *him/her the Chairman of the Meeting as *my/our proxy to vote for *me/us on my/our behalf at the Tenth Annual General Meeting of the Company to be held at Crystal Room, Level 1, Crystal Crown Hotel Harbour View, 217 Persiaran Raja Muda Musa, 42000 Port Klang, Selangor Darul Ehsan on Thursday, 17 September 2009 at 10.30 a.m. and at any adjournment thereof. My/Our proxy is to vote as indicated below: RESOLUTIONS Ordinary Resolution 1 Ordinary Resolution 2 Ordinary Resolution 3 Ordinary Resolution 4 Ordinary Resolution 5 Ordinary Resolution 6 Ordinary Resolution 7 Ordinary Resolution 8 Ordinary Resolution 9
Please indicate with an X in the spaces provided whether you wish your votes to be cast for or against the resolutions. In the absence of specific directions, your proxy will vote or abstain as *he/she thinks fit.
FOR
AGAINST
Signed this .. day of No of shares held

CDS Account No.
Signature/Common Seal of Member(s)
Notes:
1. A member of the Company entitled to attend and vote at the meeting may appoint a proxy to attend and vote instead of him. A member of the Company who is an authorized nominee as defined under the Securities Industry (Central Depositories) Act 1991 may appoint 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. A proxy need not be a member of the Company. The instrument appointing a proxy shall be in writing under the hands of the appointer or of his attorney duly authorised in writing, or if the appointer is a corporation, either under its common seal or in some other manner approved by its Directors. The instrument of proxy must be deposited at the registered office of the Company situated at Level 18, The Gardens North Tower, Mid Valley City, Lingkaran Syed Putra, 59200 Kuala Lumpur not later than forty-eight (48) hours before the time appointed for holding the meeting or any adjournment thereof.
2. 3. 4.
please fold along this line (1)
STAMP
The Company Secretary ACOUSTECH BERHAD (Company No. 496665-W) Level 18, The Gardens North Tower Mid Valley City Lingkaran Syed Putra 59200 Kuala Lumpur
please fold along this line (2)

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annual report 2009

Notice Of Annual General Meeting

Acoustech Berhad (496665-W)

Notice Of Annual General Meeting (Cont`d)

Notice Of Annual General Meeting (Cont`d)

By Order of the Board

Acoustech Berhad (496665-W)

Notice Of Annual General Meeting (Cont`d)

Statement Accompanying Notice Of Annual General Meeting

Profit Before Taxation (RM)

Acoustech Berhad (496665-W)

Acoustech Berhad (496665-W)

AUDIT COMMITTEE Soon Kwai Choy

Dato Nik Abdul Aziz Bin Mohamed Kamil

Leong Ngai Seng

OPTION COMMITTEE Su Cheng Tao

Acoustech Berhad (496665-W)

Corporate Information (Cont`d)

Dato Nik Abdul Aziz Bin Mohamed Kamil

185.7 61.2 33.0 279.9

66.3 21.9 11.8 100.0

204.9 89.2 45.8 339.9

60.3 26.2 13.5 100.0

Operating profit: Audio Electrical equipment Chemical paints

1.7 2.8 5.4 9.9

17.2 28.3 54.5 100.0

6.2 1.3 11.3 18.8

33.0 6.9 60.1 100.0

Acoustech Berhad (496665-W)

Chairmans Statement (Cont`d)

Chairmans Statement (Cont`d)

Chang Song Hai Chairman 25 August 2009 Kuala Lumpur, Malaysia

CHANG SONG HAI

Acoustech Berhad (496665-W)

Profile Of Directors (Cont`d)

Profile Of Directors (Cont`d)

HUANG HUAI SON

LEONG NGAI SENG

Acoustech Berhad (496665-W)

Profile Of Directors (Cont`d)

SHIH CHAO YUAN

SOON KWAI CHOY

Corporate Social Responsibility

Dividend Paid RM Million 30 20 10

Acoustech Berhad (496665-W)

Corporate Social Responsibility (Cont`d)

Capital Structure RM Million 300

Cash and cash equivalents

Corporate Social Responsibility (Cont`d)

With the convenience to delight

Audit Committee Report

Acoustech Berhad (496665-W)

Audit Committee Report (Cont`d)

Audit Committee Report (Cont`d)

Acoustech Berhad (496665-W)

Corporate Governance Statement

Corporate Governance Statement (Cont`d)

Acoustech Berhad (496665-W)

Corporate Governance Statement (Cont`d)

Leong Ngai Seng

Shih Chao Yuan

Corporate Governance Statement (Cont`d)

Acoustech Berhad (496665-W)