ANNUAL REPORT 2013
ANNUAL REPORT
135 Joo Seng Road, #08-01 Singapore 368363 Tel: +65 6288 8220 Fax: +65 6280 9947 Co. Reg.No.: 198900414E
www.powermatic.com.sg
Powermatic Data Systems Limited
Powermatic Data Systems Limited
Powermatic Data Systems Limited
Contents 2
Corporate Information
3
Chairman’s Statement
5
Operations Review
7
Subsidiary and Associated Companies
8
Products Distributed/Manufactured by The Group
9
Group Financial Highlights
10 Profile of Directors 11 Financial Contents
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Powermatic Data Systems Limited Annual Report 2013
Corporate Information BOARD OF DIRECTORS Executive Directors Dr Chen Mun Chairman/CEO
Mr Chen Mong Chea (Resigned on 26.7.2012) Ms Katherine Ang Bee Yan Non-Executive Directors Mr Yee Lat Shing, Tom Independent Director Prof. Lye Kin Mun Independent Director Mr David Tan Chao Hsiung Independent Director
AUDIT COMMITTEE Mr Yee Lat Shing, Tom Chairman Prof. Lye Kin Mun Mr David Tan Chao Hsiung
NOMINATING COMMITTEE Prof. Lye Kin Mun Chairman
Mr Yee Lat Shing, Tom Mr David Tan Chao Hsiung
REMUNERATION COMMITTEE Mr David Tan Chao Hsiung Chairman
SHARE REGISTRAR
Boardroom Corporate & Advisory Services Pte Ltd 50 Raffles Place #32-01 Singapore Land Tower Singapore 048623 Tel : (65) 6536 5355
AUDITORS
COMPANY SECRETARY
RSM Chio Lim 8 Wilkie Road, #03-08 Wilkie Edge Singapore 228095 Tel : (65) 6533 7600 Fax: (65) 6594 7811
REGISTERED OFFICE
AUDIT PARTNER-IN-CHARGE Mr Chow Khen Seng
Mr Yee Lat Shing, Tom Prof. Lye Kin Mun
Ms Lee Ellen
135 Joo Seng Road #08-01 Singapore 368363 Tel : (65) 6288 8220 Fax: (65) 6280 9947
PRINCIPAL BANKERS
United Overseas Bank Limited 80 Raffles Place UOB Plaza 1 Singapore 048624
Powermatic Data Systems Limited Annual Report 2013
Chairman’s Statement “In FY2013, the Group remained profitable despite the backdrop of a challenging and highly competitive global economy.” The Group suffered a drop in sales revenue, as a result of the Group’s strategy in the previous year of moving into low-volume, high-margin products that support growth industries such as Communications, Healthcare, and Banking and Finance. GROUP BUSINESS In FY2013, distribution units will continue to expand businesses in healthcare and banking industries. The markets in these sectors are expanding as Singapore is increasingly viewed as a hub for world-class healthcare and banking. A substantial number of projects are ongoing and will come to fruition over the course of these 1-2 years. Network business is facing some challenges. The ongoing pressure to deliver cost-effective, innovative solutions, which are both attractive and affordable to telecommunications and Internet service providers, has created opportunities that are really exciting for all of us. In particular, we will see an increasing need to innovate. In addition to this, the need for better solution in terms of quality and cost for customers will increase in all areas of our work. This will be challenging but will drive technology forward. In short, there will be turbulent times ahead by all measures and we must be ready to adapt and turn the challenges into our advantages.
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Powermatic Data Systems Limited Annual Report 2013
Chairman’s Statement cont’d LOOKING FORWARD As the number of smart phones and tablets overtook the number of PCs in use, a major revolution was taking place in the computer/communications industry. These smart mobile devices need wireless connectivity. From 2G data connectivity on the first generation Apple iPhone to 4G/ LTE today, the explosive growth of the smart mobile device population has outstripped the bandwidth available through successive generations of phone technology almost as soon as a new technology is invented. One way of meeting the bandwidth demand is through WiFi, which is cheap to implement and built-in for most smartphones. WiFi is already widely available in homes and isolated hotspots. The wireless business of the Group provides the technology and equipment that allow pervasive coverage of WiFi to every corner of a house, every square meter of a shopping mall/housing estate, or every street of a township. The road to the potentially explosive growth of our target market is still laden with many hurdles, not least of which is the lack of a suitable business model for the major service providers to embrace the underlying technology. However, we are seeing that the pressure of demand is forcing a breakthrough. We are beginning to get sizeable projects and many new ones are being planned. The coming year will be a busy one for our wireless business. The pressure on continued development to meet field application requirements will be relentless, but we know that the rewards will be worth it. On the distribution front of our business, our focus will continue to be on providing high valueadded products and services to the healthcare and banking industries. We shall build on the successful marketing of high-end display and storage systems in Singapore and introduce them to the regional markets. DIVIDENDS The Group would like to continue sharing the profits with our shareholders. After evaluating the current financial position of the Group, the Board is pleased to recommend a final dividend of 1 cent per share, subject to shareholders’ approval at the upcoming Annual General Meeting. ACKNOWLEDGEMENT On behalf of the Board, I would like to extend my appreciation to our shareholders, customers, employees and business partners for their support in making FY2013 a profitable year for us as a Group. We will continue to work closely with our customers, business partners, management and employees to achieve a better and profitable year ahead. I look forward to your continued support.
Dr Chen Mun Chairman
Powermatic Data Systems Limited Annual Report 2013
Operations Review “The business environment for the networking and distribution products continues to remain challenging. The Group will continue to explore new opportunities to expand its market reach.” OVERVIEW The Group’s revenue decreased by 27% from $18.1 million in FY2012 to $13.2 million in FY2013. Net profit also reduced from $2.13 million to $0.63 million. FY2013’s performance was affected by economic contractions in the Group’s Principal markets, Europe and North America and impacted by the delay of some projects in both network and distribution businesses. Earnings per share decreased from 1.23 cents to 0.36 cents while net asset per share shed 0.33 cents from 26.12 cents to 25.79 cents. The business environment for the networking and distribution products continues to remain challenging. The Group will continue to explore new opportunities to expand its market reach.
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Powermatic Data Systems Limited Annual Report 2013
Operations Review cont’d NETWORK PRODUCT BUSINESS As compared to FY2012, revenue was down by 19.5% due to the impact of the lingering debt crisis in Europe, the uncertain economic outlook in North America, and increased competition from the system-on-chip products. Production and operating costs were higher in FY2013 due partly to the inflationary impact and partly to the Group’s initiative to strengthen the marketing and research and development teams for the network products. Despite the decreased profitability, the Group will continue its research and development efforts to further enhance the product features and to explore new innovations. On the marketing front, the Group shall continue to develop new markets beyond Europe and USA and to widen the existing customers’ base. As in FY2012, the network product segment remained the core business and the main profit contributor for the Group in FY2013. DISTRIBUTION BUSINESS The Group’s distribution business suffered a net loss of $83,000 in the reporting year as compared to a net profit of $354,000 in FY2012. Revenue declined by 41% year-on-year due to the impact of slower economic growth in the local scene, keen competition from the industry players, and the increasing popularity of online purchases by end users. Fewer system integration projects were materialized in FY2013 due mainly to the deferment of capital expenditure by potential customers. PROPERTIES Rental income generated by the Group’s freehold investment property decreased slightly as compared to the preceding year due mainly to a drop in the average occupancy rate. The Sales and Lease-Back Agreement of PM Industrial Building expired on 9th March 2013. Reinstatement and rectification work as required under the terms of the said agreement are currently in progress. Furthermore, the Group has signed a new rental agreement with the same landlord to continue using the 8th floor of the same building as office premises and warehouse storage.
Powermatic Data Systems Limited Annual Report 2013
Subsidiary and Associated Companies Powermatic Data Systems Distribution Pte Ltd 135 Joo Seng Road #08-01 Singapore 368363 Tel: (65) 6288 8220 Fax: (65) 6280 9947 www.powermatic.com.sg
PM Data Sdn Bhd
苏州康培网络产品有限公司
3A22, Blok A Kelana Centre Point 3, Jalan SS 7/19 47301 Petaling Jaya Selangor Darul Ehsan, Malaysia Tel : (603) 7804 4024 Fax: (603) 7804 4124 www.pmdata.com.my
Compex Wireless (Suzhou) Co., Ltd
Compex Systems Pte Ltd 135 Joo Seng Road #08-01 Tel: (65) 6286 2086 Fax: (65) 6280 9947 www.compex.com.sg
Compex Inc. 840 Columbia Street Suite B, Brea CA 92821, USA Tel : (714) 482 0333 Fax : (714) 482 0330 www.cpx.com
PM Distribution Sdn Bhd 3A22, Blok A Kelana Centre Point 3, Jalan SS 7/19 47301 Petaling Jaya Selangor Darul Ehsan, Malaysia Tel : (603) 7804 4024 Fax: (603) 7804 4124
宝华电子(苏州)有限公司
Compex (Suzhou) Co., Ltd No. 12, ChuangTou Industrial Square, LouFeng North Suzhou Industrial Park, Suzhou People’s Republic of China Tel : (86) 512 6295 0014
No. 12, Chuangtou Industrial Square, LouFeng North Suzhou Industrial Park, Suzhou People’s Republic of China Tel : (86) 512 6295 0014
Powermatic Data Systems
(Hong Kong) Limited Room 809, 8/F Dominion Centre 43-59 Queen’s Road East, Wanchai, Hong Kong Tel : (852) 2527 1632
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Powermatic Data Systems Limited Annual Report 2013
Products Distributed/Manufactured by The Group PRODUCT DISTRIBUTED
SATA, SCSI, SAS, RAID & Network Adapters External Fibre Channel RAID Subsystem
Optical Drives / Graphic Cards Small Form Factor PC & Accessories
2.5” / 3.5” Hard Disk. Optical Drives
Professional LCD Monitors Corporate. Medical. Graphics
Fibre Channel Host Bus Adapters & Switches
Thermal Fax, Paper Fax, Laser Fax, Mono Laser Multifunction Printers and consumables
MANUFACTURED PRODUCTS Wireless Mini PCI Modules
Wireless Embedded Boards
Wireless MeshPoints Indoor Mesh - MP546 Dual 802.11n radio solution 5GHz backhaul, 2.4GHz coverage
WLM200N5-26ESD High power 2 x 2 802.11a/n MIMO miniPCI, with ESD protection
WP546 Board High power 680MHz processor speed Support up to two miniPCI slots
Outdoor Mesh - MPS546 Built-in 6.5dbi dual band omni directional antenna for backhaul and coverage
Wireless Access Points
WLE350N5-25 High power 3 x 3 802.11a/n MIMO miniPCIe
Outdoor Access Point MMJ5N26 400MHz network processor 5GHz@17dBi dual polarization antenna WPJ344 Board 2 x 2 radio on board plus one miniPCIe slot for 3 x 3 or 802.11a/c radio
Indoor Access Point WPE72NX 400MHz network processor 2 x 2dBi dual band antenna
Powermatic Data Systems Limited Annual Report 2013
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Group Financial Highlights Sales by the Geographical Region (%) FY2013
FY2012
FY2013
FY2012
USA
11.5
7.70
Asia (exc. Singapore)
22.0
27.00
15.00%
Singapore
28.8
30.80
10.00%
Europe
33.5
30.70
Others
4.2
3.80
35.00% 30.00% 25.00% 20.00%
5.00% 0.00% USA
Asia (exc. Singapore)
Singapore
Europe
Others
Glance Over the 5 Years
2009
2010
2011
2012
2013
Revenue (S$million)
39.3
30.2
24.2
18.1
13.2
1.6
1.8
1.8
2.1
0.63
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Powermatic Data Systems Limited Annual Report 2013
Profile of Directors CHEN MUN
Dr Chen Mun is the Chairman and Chief Executive Officer of the Group. He is also the founder of Powermatic Data Systems Limited and is responsible for spearheading the Company’s Research and Development programs as well as growth strategies of the Group. Prior to the founding of Powermatic, Dr Chen was a senior lecturer in the then University of Singapore. Dr Chen holds a bachelor’s degree in engineering from the University of Singapore and received a Ph.D. in engineering from the Imperial College, University of London.
KATHERINE ANG BEE YAN
Ms Katherine Ang Bee Yan joined Compex Systems Pte Ltd, a wholly-owned subsidiary of Powermatic Data Systems Limited in 2003 as Director of Sales & Marketing and Operations. She is currently the General Manager of Compex Systems Pte Ltd. She manages both the operations in Singapore and China. On 1 July 2011, Ms Katherine Ang is appointed as an Executive Director of Powermatic Data Systems Limited. Ms Ang has over 20 years of experience in the Sales & Marketing, Operations and Business Development. She plays an instrumental role in overseeing the Group’s local and overseas projects and is responsible for the overall business development.
YEE LAT SHING, TOM
Mr Yee is an independent Director and Chairman of the Audit Committee of the Company since 1992. He is a Certified Public Accountant and was a partner of Ernst & Young, an international accounting firm, from 1974 to 1989. He has more than 35 years of experience in the field of accounting and auditing and extensive experience in handling major audit assignments of public listed and private companies in various industries, including insurance, manufacturing and retailing. He is currently a consultant. Mr Yee also sits on the boards of several listed companies including Bonvest Holdings Limited, Cosco Corporation (S) Ltd, and Pacific Century Regional Developments Limited. He is also a fellow member of the Singapore Institute of Directors.
LYE KIN MUN
Prof Lye Kin Mun is an independent Director and Chairman of the Nominating Committee of
the Company. He holds a B.Sc. with distinction from the University of Alberta, Canada, in 1974, M.Eng. from the University of Singapore in 1979 and Ph.D. from the University of Hawaii at Manoa, U.S.A. in 1984 all in electrical engineering and was a Colombo Plan Scholar from 1970-74. He is currently Deputy Executive Director, Science and Engineering Research Council, Agency for Science, Technology and Research (A*STAR). He was Executive Director of the Institute for Infocomm Research, (A*STAR), and has been Director of the Centre for Wireless Communications, National University of Singapore from 1993 to 2002. Prof Lye has over 35 years experience in industry as well as teaching. Prof Lye has also served on the Boards of Singapore Polytechnic and Ngee Ann Polytechnic. He is a Director of Cellonics Inc., a startup company he co-founded. He was a consultant to several companies in the networking and wireless communications industry and sat on many national technical committees. Prof Lye is a Member of the Board on Global Science and Technology of the National Research Foundation, U.S.A. He was also a member of the Asia-Pacific Cadence Advisory Board and Advisory Committee for Next Generation Mobile Networks Project, Communications Research Lab., Japan. Prof Lye also serve as Chairman of the Strategic Programmes Review Panel of the Science and Engineering Research Council, A*STAR, and Expert Assessor for the Australian Research Council’s Discovery Projects. In 2005, he was conferred the title “Officier dans l’ordre des Palmes Academiques” by the French government.
DAVID TAN CHAO HSIUNG
David Tan was appointed a non-executive director on 24 March 2008. He has over 20 years of experience in the banking and finance industry and has held senior management positions in both local and international financial institutions. Currently, he is the Executive Director of Omega Capital Pte Ltd. He holds a Master in Commerce (specialising in Finance) from the University of New South Wales and a Bachelor of Economics from Macquarie University. He is also a Fellow of the Institute of CPA (Australia).
Financial Contents 12 Corporate Governance Report 22 Directors’ Report 27 Statement by Directors 28 Independent Auditors’ Report 30 Consolidated Statement of Comprehensive Income 31 Statements of Financial Position 32 Statements of Changes in Equity 34 Consolidated Statement of Cash Flows 35 Notes to the Financial Statements 82 Statistics of Shareholdings 83 Notice of Twenty Fifth Annual General Meeting Proxy Form
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Powermatic Data Systems Limited Annual Report 2013
Corporate Governance Report Powermatic Data Systems Limited continues to uphold high standards of corporate governance and strives to develop procedures and policies consistent with best business practice so as to enhance corporate transparency and protect interest of shareholders. This report outlines the main corporate governance practices of the Company with specific reference to the Code of Corporate Governance 2005 (the “Code”). Except where compelling reasons require otherwise, the Company believes it has complied with the Code. Board of Directors Currently, the members of the Board are: Dr Chen Mun Ms Katherine Ang Bee Yan Mr Yee Lat Shing, Tom Prof Lye Kin Mun David Tan Chao Hsiung
Chairman and Chief Executive Officer Executive Director Independent Director Independent Director Independent Director
BOARD MATTERS Board’s Conduct of its Affairs (Principle 1) The Board is responsible for overall corporate governance and its main focus is to ensure proper management of the business and affairs of Company to protect and enhance long-term value and returns for its shareholders. The primary responsibilities of the Board are: • approving board policies, strategies, financial objectives and direction of the Group and monitoring performance of management; • overseeing the process for evaluating the Group’s system of internal controls, including financial, operational and compliance controls, and risk management systems; • approving nominations of new Directors to the Board appointment of key personnel; • reviewing half-year and full-year financial statements and announcements, results of operations and significant business plans including acquisitions and disposal of investments; • providing oversight in the proper conduct of the Company’s business and assuming responsibility for corporate governance; • approving interested person transactions; and • approving corporate or financial restructuring, share issuance, dividends and other returns to shareholders. The Board functions are either carried out by the Board or delegated to the various Committees established by the Board, namely the Audit Committee (“AC”), the Nominating Committee (“NC”) and the Remuneration Committee (“RC”). These committees function within clearly defined terms of reference and operating procedures, which are reviewed on a regular basis. A formal letter of appointment is provided to all new Directors. The letter indicates the amount of time commitment required and the scope of duties. The Company has adopted a policy that welcomes the Directors to request for further explanations, briefings or informal discussions on any aspect of the Company’s operations or businesses from the Management. Newly appointed Directors will be considered for appropriate training and orientation programmes to familiarize them with the operations of the Company and its major business processes.
Powermatic Data Systems Limited Annual Report 2013
Corporate Governance Report cont’d The Company provides ongoing education on Board processes, governance and best practices, including updates on changes in the accounting, legal, industry specific knowledge and regulatory changes. The Board conducts regular meetings, which are scheduled in advance each year. Meetings of Board and Board Committees are supplemented by circular resolutions, which are accompanied by relevant explanations and supporting documents. Board Composition And Balance (Principle 2) The Board comprises two Executive Directors and three Independent Non-Executive Directors. The Board’s structure, size and composition are reviewed annually by the NC who is of the view that the current size of the Board is appropriate, taking into account the nature and scope of the Group’s operations, to facilitate effective decision making. The independence of each director is reviewed annually by the NC who has adopted the Code’s definition of what constitutes an independent director in its review. In respect of the NC’s review of the independence of each director for this financial year, the NC considered that, half of the Board is independent, including the Chairman of the NC. The strong independent element on the Board ensures that it is able to exercise objective and independent judgment on corporate affairs. The NC is satisfied that the Board comprises Directors who as a group provide core competencies such as accounting, finance, business and management experience, industry knowledge, and customer-based experience and knowledge. The NC and the Board is of the view that, given the commercial experience and academic qualifications of each of its members, its composition of Directors is well-balanced. Members of the Board are constantly in touch with the Management to provide advice and guidance on strategic issues and on matters for which their expertise will be constructive to the Group. Key information on the Directors is set out below and on page 10 of this Annual Report. Name of Director
Age
Directorship (a) Date first appointed (b) Date last re-elected
Due for re-election at next AGM
Chen Mun
65
(a) 1 February 1989 (b) NA
–
Katherine Ang Bee Yan
49
(a) 1 July 2011 (b) 25 July 2011
–
Yee Lat Shing, Tom
78
(a) 1 June 1992 (b) 26 July 2012
Retiring pursuant to Section 153(6)
Prof Lye Kin Mun
61
(a) 1 February 1993 (b) 26 July 2012
–
David Tan Chao Hsiung
52
(a) 24 March 2008 (b) 25 July 2011
Retiring pursuant to Article 99
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Powermatic Data Systems Limited Annual Report 2013
Corporate Governance Report cont’d Role Of Chairman And Chief Executive Officer (Principle 3) The role of the Chairman and Chief Executive Officer (“CEO”) are not separated but the Board has a strong independent group of Directors to look after shareholders’ interests. Day-to-day running of business operations are delegated to key senior executives while the Chairman focuses on long term and strategic plans of the Company. The Board is mindful of the desirability of separating the two functional positions. However, it believes that vulnerability of the dual roles, if any, is considerably lessened by the checks and balances energetically exercised by a board that comprises 50% independent directors. In practice, all major decisions made by the Executive Chairman are reviewed by the independent directors and reported to the Board. The NC and the Board are of the view of that it is in the best interests of the Group to adopt a single leadership structure i.e. where the CEO and Chairman of the Board is the same person, so as to ensure that the decision-making process of the Group would not be unnecessarily hindered. The Group’s Executive Chairman and CEO is Dr Chen Mun. He has played an instrumental role in developing the business of the Group and has also provided the Group with strong leadership and vision. The appointment of the Executive Chairman and CEO to the Board is reviewed by the NC and his remuneration package is reviewed by the RC at least once a year. Both the RC and the NC comprise all Independent Directors. As such, the Board believes that there are adequate safeguards in place against an uneven concentration of power and authority in a single individual. The Chairman is responsible for the proper workings of the Board which include the scheduling of meetings, setting of Board meeting agenda in consultation with the Company Secretary, exercising of control over quality and timeliness of information flow between the Management and the Board, managing the business of the Board and Board Committees, monitoring the translation of the Board’s decision and wishes into executive actions and is assisted by the three Board Committees in ensuring compliance with the Company’s guidelines on corporate governance. Board Membership (Principle 4) Board Performance (Principle 5) Nominating Committee The NC comprises three Independent Non-Executive Directors. The principal functions of the NC are: • reviews the structure, size and composition of the Board and make recommendations to the Board; • identifies candidates and reviews all nominations for appointment of new directors, determining whether or not such nominee has the requisite qualifications, set up a process for the selection of such appointments and recommends all appointments of directors to the board and board committees. Accordingly, in selecting potential new directors, the NC will seek to identify the competencies required to enable the Board to fulfil its responsibilities. In doing so, the NC will have to regard to the results of the annual appraisal of the Board’s performance. The NC may engage consultants to undertake research on, or assess, candidates for new positions on the Board, or to engage such other independent experts as it considers necessary to carry out its duties and responsibilities;
Powermatic Data Systems Limited Annual Report 2013
Corporate Governance Report cont’d • re-nominate and re-elect director for re-appointment, having regard to the directors’ contribution and performance; • identifies gaps in the mix of skills, experience and other qualities required in an effective Board; and • reviews the independence of each Director and to ensure that the Board comprises at least one-third independent Directors. The NC has adopted written terms of reference. The NC met once during the financial period. The profile of the Directors are disclosed on page 10 (“Profile of Directors”) of this annual report. The NC in considering the re-appointment of any Director, evaluates the performance of that Director and his contribution to the Board as a whole. Board performance evaluation is carried out at least once a year. The NC has reviewed the independence of Mr Yee Lat Shing, Tom, Prof Lye Kin Mun and Mr David Tan Chao Hsiung for FY2013. The NC is satisfied that there are no relationships, which would deem any of them not to be independent. Despite some of the Directors having other Board representation, the NC is satisfied that these Directors are able to and have adequately carried out their duties as Directors of the Company. Pursuant to Article 99 and Article 103 of the Articles of Association of the Company, new Directors must submit themselves for re-election at the next annual general meeting (“AGM”) of the Company and onethird of the Directors, other than the Managing Director, who are eligible for re-election must retire from office by rotation at every AGM. Directors over 70 years of age are required to be re-appointed every year at the AGM pursuant to Section 153(6) of the Companies Act, Chapter 50 before they can continue to act as Director. The NC, with Mr David Tan Chao Hsiung abstaining from deliberations in respect of his own nomination, has recommended the re-election of Mr David Tan Chao Hsiung as Director at the forthcoming AGM. The NC, with Mr Yee abstaining from deliberations in respect of his own nomination, has also recommended that Mr Yee Lat Shing, Tom who is over 70 years of age, be nominated for re-appointment at the forthcoming AGM. The Company has in place a system to access the performance of the Board as a whole. The result of the exercise is reviewed by the NC before submitting to the Board for discussing and determining areas for improvement and enhancing of the Board effectiveness. The Board adopts the independence test recommended by the Code. Taking into account of the independence test, the NC considers and determines the independence of directors. Key information regarding the directors is set out in this Annual Report under the heading titled “Board of Directors”.
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Powermatic Data Systems Limited Annual Report 2013
Corporate Governance Report cont’d In determining the objective performance criteria for evaluation and determination for the FY2013, the NC had considered the attendance, participation and contribution of individual Directors at Board and Committee meetings to evaluate each Director’s performance. The attendance of the Directors at meetings of the Board and Board Committees held during the year are as follows: Board
Audit Committee
Nominating Committee
Remuneration Committee
Held
Attended
Held
Attended
Held
Attended
Held
Attended
Chen Mun
2
2
NA
NA
NA
NA
NA
NA
Katherine Ang Bee Yan
2
2
NA
NA
NA
NA
NA
NA
Yee Lat Shing, Tom
2
2
3
3
1
1
2
2
Lye Kin Mun
2
2
3
3
1
1
2
2
David Tan Chao Hsiung
2
2
3
3
1
1
2
2
Access To Information (Principle 6) In order to ensure that the Board is able to fulfill its responsibilities, Management is required to provide adequate and timely information on all matters that require the Board’s decision as well as ongoing reports on material operational and financial matters of the Company and the Group. The Directors have also been provided with the contact numbers and email particulars of the Company’s senior management and the Company Secretary to facilitate access to any required information. The role of the Company Secretary is clearly defined and includes the responsibility of ensuring that Board procedures are followed and that rules and regulations are complied with. The appointment and removal of the Company Secretary are subject to the Board’s approval. Should the Directors, whether as a group or individually, need independent professional advice, such advice will be sought with the Board’s approval and the professional expense will be borne by the Company. REMUNERATION MATTERS Procedures For Developing Remuneration Policies (Principle 7) Level And Mix Of Remuneration (Principle 8) Disclosure On Remuneration (Principle 9) The RC comprises three Independent Non-Executive Directors. The responsibilities of RC are: • to ensure a formal and transparent procedure for developing policy on executive remuneration, and for fixing the remuneration packages of individual Directors, CEO and senior management. RC’s recommendations will be made in consultation with the Chairman of the Board and submitted for endorsement by the entire Board. RC’s review cover all aspects of remuneration, including but not limited to Director’s fees, salaries, allowances, bonuses, options and benefits-in-kind; • to review remuneration of employees related to Executive Directors and controlling shareholders of the Company and the Group and that these commensurate with their respective job scopes and responsibilities;
Powermatic Data Systems Limited Annual Report 2013
Corporate Governance Report cont’d • to recommend the Directors’ fees of Non-Executive Directors to the Board based on their level of contribution taking into account factors such as effort, time spent and responsibilities; and • to administer the Company’s Employee Stock Option Scheme (“ESOS”). The ESOS seeks to reward and retain Executive Directors and employees whose services are vital to the well-being and success of the Group and also to align interests of employees with that of the shareholders. Details of the ESOS are disclosed in the Directors’ Report. The RC has adopted the written terms of reference. The RC met twice during the financial year. The Executive Directors’ and key senior management remuneration packages are based on service contracts and their remuneration are reviewed by the RC. The NC, together with the RC, decides on the specific remuneration package for an Executive Director upon recruitment. Thereafter, the RC reviews subsequent increments, bonuses and allowances where these payments are discretionary. No Director or member of the RC is involved in deciding his own remuneration. The RC reviews what compensation commitments the executive directors’ service contracts would entail in event of early termination by either the Company or Executive Directors giving to the other at least two months prior written notice. The Non-Executive Directors are paid a fixed fee. Fees paid to Non-Executive Directors are subject to approval of shareholders at the Annual General Meeting (“AGM”). No Director is involved in deciding his remuneration. The RC will seek expert advice on remuneration of all directors, if necessary. DISCLOSURE OF REMUNERATION OF DIRECTORS AND KEY EXECUTIVES Details of remuneration paid/payable to the directors of the Company and key executives of the Group for the financial year ended 31 March 2013 are set out below: Fee %
Salary %
Bonus %
Other Benefits %
Total %
DIRECTORS Below $250,000 Chen Mun Katherine Ang Bee Yan Yee Lat Shing, Tom Lye Kin Mun David Tan Chao Hsiung
– – 100 100 100
90.9 93.7 – – –
9.1 6.3 – – –
– – – – –
100 100 100 100 100
KEY EXECUTIVES Below $250,000 Chua Geok Cheok Molly Yau Liong We Yaw Thiam Teng Liu Jun Wu Tian Yee
– – – – –
92.2 92.2 91.9 92.3 91.8
7.8 7.8 8.1 7.7 8.2
– – – – –
100 100 100 100 100
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Powermatic Data Systems Limited Annual Report 2013
Corporate Governance Report cont’d REMUNERATION OF EMPLOYEE WHO IS AN IMMEDIATE FAMILY OF DIRECTOR(S) There is no immediate family member of a director, CEO or substantial shareholders in employment with the Group and whose remuneration exceeds S$150,000 for the financial year ended 31 March 2013. ACCOUNTABILITY AND AUDIT Accountability (Principle 10) In presenting the annual financial statements and half-yearly announcements to shareholders, it is the aim of the Board to provide the shareholders with a detailed analysis, explanation and assessment of the Group’s financial position and prospects. Management provides all members of the Board with appropriately detailed management accounts of the Group’s performance, position and prospects on a quarterly basis and management accounts are provided to executive directors on a monthly basis. Audit Committee (Principle 11) The AC comprises three members, all of whom are independent of Management. The AC has adopted written terms of reference. The Board is of the view that the members of the AC have sufficient financial management expertise and experience and are qualified to discharge the AC functions. The AC is responsible for carrying out the following primary functions: • assisting the Board in discharging its statutory responsibilities on financial and accounting matters; • reviewing audit plans of the external and internal auditors and evaluating the reports issued by the external and internal auditors from their examination of the Company’s internal control system; • reviewing the financial and operating results of the Group and the Company in compliance with accounting policies and assistance given by the Management to its auditors; • reviews interim and annual announcement of results of the Group and the Company before submission to the Board for approval; • reviewing the adequacy of the Company’s internal control (financial, compliance and operational) and risk management policies and systems established by the management; • reviewing the financial statements of the Group and the Company before submission to the Board; • reviewing interested party transactions; • reviewing the independence of external auditors annually and consider the appointment or reappointment of external auditors and matters relating to the resignation or removal of the auditors and approve the remuneration and terms of engagement of the external auditors; and • nominating external auditors for re-appointment. The Group has complied with Rule 712 and Rule 716 of the Listing Manual issued by Singapore Exchange Securities Limited. The AC has full access to and co-operation of Management, has full discretion to invite any Director or executive officer to attend the meetings and has been given reasonable resources to enable it to discharge its functions. Minutes of the meetings are circulated to the Board for its information. Apart from formal meetings, the Chairman and various members of the AC will hold informal meetings and discussions with the Management as and when necessary. Members of the AC have independent access to both external and internal auditors. The AC met with both internal and external auditors without the presence of management.
Powermatic Data Systems Limited Annual Report 2013
Corporate Governance Report cont’d The AC has reviewed the audit and non-audit services provided by the external auditors, RSM Chio Lim LLP. The audit service fee incurred during the reporting year are as follows: 2013
2012
$’000
$’000
110
110
Fees on audit services paid/payable to - Auditors of the company - Other auditors
#
Total #
25
27
135
137
Includes a member firm of RSM International
There were no non-audit services provided by the external auditors during the reporting year. The AC is satisfied that the independence of the external auditors are not impaired and recommends to the Board, the re-appointment of Messrs RSM Chio Lim LLP as the external auditors of the Company. Internal Controls (Principle 12) Internal Audits (Principle 13) The Group has outsourced its internal audit function to Messrs Nexia TS. The internal auditor reports directly to the chairman of the AC on audit matters. Any non-compliance and internal control weaknesses noted during the internal audit and the recommendations thereof are reported to the AC as part of the review of the Group’s internal control system. The AC also reviews and approves the annual internal audit plans and resources to ensure that the internal auditor has the necessary resources to adequately perform its functions. Based on the reviews conducted by the internal and external auditors of the Group and the actions undertaken by management, the Board opines, with the concurrence of the AC, that there are adequate controls in place within the Group addressing material financial, operational and compliance risks to meet the needs of the Group in its current business environment. RISK MANAGEMENT The practice of risk management is undertaken by the Company’s Executive Directors and senior executives of each business unit under the purview of the Board of Directors. The significant risks factors relevant to the Group’s operations and management of such risks are discussed as follows: Economic And Market Risks The Group’s main businesses are in the manufacture, sale and distribution of network and computer related products. The industry is subject to price cutting activities of our competitors as well as high levels of inventory obsolescence due to technological changes.
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Powermatic Data Systems Limited Annual Report 2013
Corporate Governance Report cont’d We manage these risks through close monitoring of competitors pricing and activities and stringent management of all purchases to ensure optimum levels of inventory are maintained. Financial Risks Such risks include mainly foreign exchange risks from foreign currency denominated assets and liabilities and credit risks arising from default by customers. The Group manages foreign exchange risk by arranging to purchase and sell its goods in the same currency and to settle such transactions within 90 days. Where there are longer term exposure, appropriate hedge instruments are used. In order to manage credit risks, we have an established system of credit evaluation and collection and close monitoring of debts at senior management level. The Board is satisfied with the Group’s risk management practices and that the risk facing the Group has been adequately addressed. Communications with Shareholders (Principle 14) The Company does not practise selective disclosure. In line with continuous disclosure obligations of the Company pursuant to the SGX-ST’s Listing Rules, the Board’s policy is that all shareholders should be equally and timely informed of all major developments that impact the Group. Information is communicated to shareholders on a timely basis through: • annual reports and Notice of AGM that are prepared and issued to all shareholders; • financial statements containing a summary of the financial information and affairs of the Group for interim and full year are published through the SGXNET; and • notices of and explanatory notes for AGM and Extraordinary General Meetings. Greater Shareholder Participation (Principle 15) The Notice of AGM is also advertised in a daily newspaper and made available on the SGX-ST website. At the AGM, shareholders are given the opportunity to air their views and ask questions regarding the Company and the Group. The Articles of Association of the Company allows shareholders to appoint one or two proxies to attend and vote in their stead at the AGM. The Board regards the AGM as an opportunity to communicate directly with its investors and encourages participative dialogue. The Chairman and External Auditors are present to assist the Directors in addressing relevant queries by shareholders. The chairpersons of the Audit, Remuneration and Nominating committees are normally available at the meeting to answer any questions pertaining to the functions and conduct of these Board Committees. The Company Secretary records minutes of every AGM and the minutes will be made available to the shareholders upon their request. Dealings in Securities The Company has adopted its own internal compliance code to provide guidance to its Directors and officers in relation to their dealings in the Company’s securities. Its Directors and officers are advised not to deal in the Company’s shares during the period commencing six weeks before the announcement of the Company’s half-year and full-year results and ending one day after the public release of such results. The Company emphasizes that the law on insider trading is applicable at all times, notwithstanding the window periods for dealing in the shares.
Powermatic Data Systems Limited Annual Report 2013
Corporate Governance Report cont’d Directors and officers are also advised against dealing in the securities when they are in possession of any unpublished material price-sensitive information of the Group and Company and on consideration of a short-term nature. The Board is satisfied with the Group’s commitment in compliance with its own internal compliance code. Directors and officers are also encouraged not to deal in the Company’s securities on short-term considerations. Interested Person Transactions The Company has established procedures to ensure that all transactions with interested persons are reported on a timely manner to the AC and that the transactions are carried out at arm’s length and under normal commercial terms. There are no reportable interested person transactions for the financial year ended 31 March 2013. Material Contracts There were no material contracts entered into by the Company and its subsidiaries involving the interest of substantial shareholders or CEO or any Director, which are either subsisting at the end of the financial year or, if not then subsisting, entered into since the end of the previous financial year.
21
22
Powermatic Data Systems Limited Annual Report 2013
Directors’ Report The directors of the company are pleased to present their report together with the audited financial statements of the company and of the group for the reporting year ended 31 March 2013. 1.
DIRECTORS AT DATE OF REPORT The directors of the company in office at the date of this report are: Dr Chen Mun Ang Bee Yan, Katherine Yee Lat Shing, Tom Lye Kin Mun David Tan Chao Hsiung
2.
ARRANGEMENTS TO ENABLE DIRECTORS TO ACQUIRE BENEFITS BY MEANS OF THE ACQUISITION OF SHARES AND DEBENTURES Neither at the end of the reporting year nor at any time during the reporting year did there subsist any arrangement whose objective is to enable the directors of the company to acquire benefits by means of the acquisition of shares or debentures in the company or any other body corporate except as mentioned below.
3.
DIRECTORS’ INTERESTS IN SHARES AND DEBENTURES The directors of the company holding office at the end of the reporting year had no interests in the share capital, debentures and options of the company and related corporations as recorded in the register of directors’ shareholdings kept by the company under section 164 of the Singapore Companies Act, Chapter 50 except as follows: Name of directors and companies in which interests are held In the company − Powermatic Data Systems Limited Dr Chen Mun Ang Bee Yan, Katherine
Direct interest At beginning of the reporting year
At end of the reporting year
Number of shares of no par value 97,139,662 13,874,000
97,139,662 13,874,000
By virtue of section 7 of the Singapore Companies Act, Chapter 50, Dr Chen Mun is deemed to have interest in all the related corporations of the company. The directors’ interests in the company and related corporations as at 21 April 2013 were the same as those at the end of the reporting year.
Powermatic Data Systems Limited Annual Report 2013
Directors’ Report cont’d 4.
CONTRACTUAL BENEFITS OF DIRECTORS Since the beginning of the reporting year, no director of the company has received or become entitled to receive a benefit which is required to be disclosed under section 201(8) of the Singapore Companies Act, Chapter 50, by reason of a contract made by the company or a related corporation with the director or with a firm of which he is a member, or with a company in which he has a substantial financial interest except as disclosed in the financial statements.
5.
SHARE OPTIONS During the reporting year, no option to take up unissued shares of the company or any corporation in the group was granted except as follows: The company has an employee share option scheme known as the “Powermatic Data Systems Employees’ Share Option Scheme 2003” (the “Scheme”). The Scheme is a share incentive scheme designed to acknowledge the contributions made by the employees and to give recognition to such employees by giving them the opportunity to have a personal stake in the company and to motivate such employees in optimising their performance standards and efficiency and achieve strategic business objectives of the group and retention of key employees whose contributions are important to the long-term growth and profitability of the group. The scheme expired on 28 February 2013. The options granted on 12 December 2003 and 28 June 2010 remain exercisable up to their respective exercisable date. Under the rules of the Scheme, all directors and full-time employees of the group are eligible to participate in the Scheme except for employee or director who is also a controlling shareholder or an associate of a controlling shareholder. The Scheme extends only to the employees of the company and its subsidiaries. Employees of the company’s associated companies are not eligible under the Scheme. The aggregate number of shares over which options may be granted shall not exceed 15% of the issued share capital of the company on the day immediately preceding the offer date of the option. The Scheme is administered by the Remuneration Committee comprising David Tan Chao Hsiung (Chairman) and two other independent directors of the company, Lye Kin Mun and Yee Lat Shing, Tom. For options granted on 12 December 2003, the options shall be exercisable from the 1st anniversary to the 5th anniversary of the offering date for non-executive directors and from the 1st anniversary to the 10th anniversary of the offering date for full time employees. For options granted on 28 January 2010, the options shall be exercisable from the 1st half year to the 5th anniversary of the offering date. No options were granted to non-executive directors. The offer price shall be equal to the average of the last dealt price for a share for the three consecutive trading days immediately preceding the offer date.
23
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Powermatic Data Systems Limited Annual Report 2013
Directors’ Report cont’d 5.
SHARE OPTIONS (Cont’d) The outstanding number of options at the end of the reporting year was:
Offer date
Balance at 1.4.2012
Expired
12.12.2003
210,000
–
28.01.2010
Exercised
Balance at 31.3.2013
–
Offer price per share
Period exercisable
210,000
13 cents
12.12.2004 – 11.12.2013
13 cents
27.07.2010 – 27.01.2015
2,740,000
(120,000)
–
2,620,000
2,950,000
(120,000)
–
2,830,000
There were no unissued shares of subsidiaries under option as at 31 March 2013. Particulars of employees of the company who received 5% or more of the total options under the Scheme are as follows:
Name of employees
Aggregate options granted since commencement of Scheme to 31.3.2013
Yaw Thiam Teng
800,000
Chang Qiang
520,000
Yau Liong We
520,000
Wu Tian Yee
500,000
Ang Lay Hoon
450,000 2,790,000
Aggregate options exercised since commencement of Scheme to 31.3.2013 (150,000) – (400,000) – – (550,000)
Aggregate options outstanding as at
31.3.2013 650,000 520,000 120,000 500,000 450,000 2,240,000
Except as disclosed above, there were no shares of the company or any corporation in the group issued by virtue of the exercise of an option to take up unissued shares of the company during the reporting year and there were no unissued shares of the company or any corporation in the group under option at the end of the reporting year. The company will be seeking shareholders’ approval to adopt a new employee share option Scheme at the EGM to be held on 25 July 2013.
Powermatic Data Systems Limited Annual Report 2013
Directors’ Report cont’d 6.
AUDIT COMMITTEE The members of the audit committee at the date of this report are as follows: Yee Lat Shing, Tom
(Chairman of audit committee, independent and non-executive director)
Lye Kin Mun
(Independent and non-executive director)
David Tan Chao Hsiung
(Independent and non-executive director)
The audit committee performs the functions specified by section 201B(5) of the Singapore Companies Act, Chapter 50. Among other functions, it performed the following: •
Reviewed with the internal auditors their audit plan, results of their internal audit procedures and their evaluation of the adequacy of the company’s system of internal accounting controls;
•
Reviewed with the independent external auditors their audit plan, their evaluation of the company’s internal accounting controls that are relevant to their audit and their audit findings;
•
Reviewed the half yearly and annual financial statements of the group and the company and the independent auditors’ report on the annual financial statements prior to their submission to the board of directors of the company for adoption;
•
Reviewed the assistance given by the company’s management to the independent external auditors and internal auditors;
•
Reviewed the nature and extent of non-audit services provided by the independent external auditors, if any; and
•
Reviewed the interested person transactions (as defined in Chapter 9 of the Listing Manual of the Singapore Exchange Securities Trading Limited), if any.
The audit committee also meets with internal and external auditors without the presence of management at least once a year to obtain feedback on the competency and adequacy of the finance function and to ascertain if there are any material weaknesses or control deficiencies in the financial reporting and operational systems of the group. Other functions performed by the audit committee are described in the Corporate Governance Report included in the Annual Report. It also includes an explanation of how independent auditors’ objectivity and independence are safeguarded where the independent auditors provide non-audit services. Based on the review conducted by the external and internal auditors, the Board opines, with the concurrence of the AC, that there are adequate controls in place within the Group addressing material financial, operational and compliance risks to meet the needs of the Group in its current business environment. The audit committee has recommended to the board of directors that RSM Chio Lim LLP be nominated for re-appointment as independent external auditors at the next annual general meeting of the company.
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Powermatic Data Systems Limited Annual Report 2013
Directors’ Report cont’d 7.
INDEPENDENT AUDITORS The independent auditors, RSM Chio Lim LLP, have expressed their willingness to accept reappointment.
8.
SUBSEQUENT DEVELOPMENTS There are no significant developments subsequent to the release of the group’s and the company’s preliminary financial statements, as announced on 30 May 2013, which would materially affect the operating and financial performance of the group and of the company as of the date of this report.
On Behalf of The Directors
............................................... Dr Chen Mun Director
............................................... Ang Bee Yan, Katherine Director 10 June 2013
Powermatic Data Systems Limited Annual Report 2013
Statement by Directors In the opinion of the directors, (a)
the accompanying statements of financial position, consolidated statement of profit or loss and other comprehensive income, statements of changes in equity, consolidated statement of cash flows, and notes thereto are drawn up 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 2013 and the results and cash flows of the group, and the changes in equity of the company and of the group for the reporting year then ended; and
(b)
at the date of this statement, there are reasonable grounds to believe that the company will be able to pay its debts as and when they fall due.
The board of directors approved and authorised these financial statements for issue.
On Behalf of The Directors
............................................... Dr Chen Mun Director
............................................... Ang Bee Yan, Katherine Director 10 June 2013
27
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Powermatic Data Systems Limited Annual Report 2013
Independent Auditors’ Report to the Members of POWERMATIC DATA SYSTEMS LIMITED (Registration No: 198900414E)
Report on the Financial Statements We have audited the accompanying financial statements of Powermatic Data Systems Limited (the “company”) and its subsidiaries (collectively, the “group”) as set out on page 8 which comprise the consolidated statement of financial position of the group and the statement of financial position of the company as at 31 March 2013, and the consolidated statement of profit or loss and other comprehensive income, statement of changes in equity and statement of cash flows of the group, and statement of changes in equity of the company for the reporting year then ended, and a summary of significant accounting policies and other explanatory information. Management’s Responsibility for the Financial Statements Management is responsible for the preparation of the financial statements that give a true and fair view in accordance with the provisions of the Singapore Companies Act, Chapter 50 (the “Act”) and Singapore Financial Reporting Standards, and for devising and maintaining a system of internal accounting controls sufficient to provide a reasonable assurance that assets are safeguarded against loss from unauthorised use or disposition; and transactions are properly authorised and that they are recorded as necessary to permit the preparation of true and fair statement of profit or loss and other comprehensive income and statements of financial position and to maintain accountability of assets. Auditor’s Responsibility Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with Singapore Standards on Auditing. Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor’s judgement, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation of financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by management, 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 consolidated financial statements of the group and the statement of financial position and statement of changes in equity of the company are properly drawn up in accordance with the provisions of the Act and Singapore Financial Reporting Standards 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 2013 and of the results, changes in equity and cash flows of the group and the changes in equity of the company for the reporting year ended on that date.
Powermatic Data Systems Limited Annual Report 2013
Independent Auditors’ Report to the Members of POWERMATIC DATA SYSTEMS LIMITED (Registration No: 198900414E)
cont’d Report on Other Legal and Regulatory Requirements In our opinion, the accounting and other records required by the Act to be kept by the company and by those subsidiaries incorporated in Singapore of which we are the independent auditors have been properly kept in accordance with the provisions of the Act.
RSM Chio Lim LLP Public Accountants and Certified Public Accountants Singapore 10 June 2013 Partner-in-charge: Chow Khen Seng Effective from the reporting year ended 31 March 2013
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Powermatic Data Systems Limited Annual Report 2013
Consolidated Statement of Profit or Loss and Other Comprehensive Income Year Ended 31 March 2013
Revenue Cost of Sales Gross Profit Other Items of Income Property Income Property Expenses Profit From Property Dividend Income Interest Income Other Credits Other Items of Expense Distribution Costs Administrative Expenses Other Operating Expenses Finance Cost Other Charges Profit Before Income Tax Income Tax Income Profit, Net of Tax Other Comprehensive Income, Net of Tax Items That May Be Reclassified Subsequently to Profit or Loss: Exchange Differences On Translating Foreign Operations Fair Value Adjustment On Available-For-Sale Financial Assets Other Comprehensive Income for the year, Net of Tax Total Comprehensive Income for the Year
Notes
2013 $’000
2012 $’000
5
13,200 (9,698) 3,502
18,128 (13,416) 4,712
6 7
4,151 (3,758) 393 214 318 341
4,188 (3,918) 270 180 197 217
(1,599) (2,409) (33) (2) (103) 622 49 671
(1,343) (2,310) (14) (3) (94) 1,812 271 2,083
26 456 482 1,153
108 1,262 1,370 3,453
8
8 10
Profit, Net of Tax Attributable to: − Owners of the Parent − Non-Controlling Interests
Total Comprehensive Income Attributable to: − Owners of the Parent − Non-Controlling Interests
Earnings per share Earnings Per Share Currency Unit Basic and Diluted
11
The accompanying notes form an integral part of these financial statements.
626 45 671
2,126 (43) 2,083
1,108 45 1,153
3,496 (43) 3,453
Cents
Cents
0.36
1.23
Powermatic Data Systems Limited Annual Report 2013
Statements of Financial Position As at 31 March 2013
Group
ASSETS Non-Current Assets Plant and Equipment Investment Property Intangible Assets Investments in Subsidiaries Deferred tax assets Other Financial Assets, Non-Current Total Non-Current Assets Current Assets Inventories Trade and Other Receivables Other Financial Assets, Current Other Assets Cash and Cash Equivalents Total Current Assets
2013 $’000
2012 $’000
2013 $’000
2012 $’000
13 14 15 16 10 17
709 18,667 83 – 67 7,113 26,639
1,183 18,860 94 – 67 6,657 26,861
37 18,667 17 5,888 – 7,113 31,722
282 18,860 18 5,888 – 6,657 31,705
18 19 20 21 22
1,209 1,678 515 322 17,531 21,255
1,342 1,001 452 370 20,238 23,403
– 1,688 515 122 7,726 10,051
– 2,157 452 123 8,436 11,168
47,894
50,264
41,773
42,873
34,556 7,229 2,901 44,686 2 44,688
34,556 8,336 2,419 45,311 (43) 45,268
34,556 2,615 3,673 40,844 – 40,844
34,556 2,864 3,217 40,637 – 40,637
26 1,673 1,507 3,206
210 1,857 2,929 4,996
– 168 761 929
– 183 2,053 2,236
47,894
50,264
41,773
42,873
Total Assets EQUITY AND LIABILITIES Equity Share Capital Retained Earnings Other Reserves Equity Attributable to Owners of the Parent Non-Controlling Interests Total Equity Current Liabilities Income Tax Payable Trade and Other Payables Other Liabilities, Current Total Current Liabilities Total Equity and Liabilities
Company
Notes
23 25
27 26
The accompanying notes form an integral part of these financial statements.
31
32
Powermatic Data Systems Limited Annual Report 2013
Statements of Changes in Equity Year Ended 31 March 2013
Total Equity $’000
Attributable to Parent Sub-total $’000
Share Capital $’000
Other Reserves $’000
Retained Earnings $’000
45,268
45,311
34,556
2,419
8,336
1,153
1,108
–
482
626
NonControlling Interest $’000
Group Current Year: Opening Balance at 1 April 2012 Total Comprehensive Income for the Year
(43) 45
Dividends Paid (Note 12)
(1,733)
(1,733)
–
–
(1,733)
–
Closing Balance at 31 March 2013
44,688
44,686
34,556
2,901
7,229
2
43,548
43,548
34,556
1,049
7,943
–
Previous Year: Opening Balance at 1 April 2011 Total Comprehensive Income for the Year
3,453
3,496
–
1,370
Dividends Paid (Note 12)
(1,733)
(1,733)
–
–
Closing Balance at 31 March 2012
45,268
45,311
34,556
2,419
The accompanying notes form an integral part of these financial statements.
2,126
(43)
(1,733)
–
8,336
(43)
Powermatic Data Systems Limited Annual Report 2013
Statements of Changes in Equity Year Ended 31 March 2013
cont’d Total Equity $’000
Share Capital $’000
Other Reserves $’000
Retained Earnings $’000
40,637
34,556
3,217
2,864
Company Current Year: Opening Balance at 1 April 2012 Total Comprehensive Income for the Year
1,940
–
456
Dividends Paid (Note 12)
(1,733)
–
–
1,484
Closing Balance at 31 March 2013
40,844
34,556
3,673
2,615
38,819
34,556
1,955
2,308
(1,733)
Previous Year: Opening Balance at 1 April 2011 Total Comprehensive Income for the Year
3,551
–
1,262
Dividends Paid (Note 12)
(1,733)
–
–
Closing Balance at 31 March 2012
40,637
34,556
3,217
The accompanying notes form an integral part of these financial statements.
2,289 (1,733) 2,864
33
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Powermatic Data Systems Limited Annual Report 2013
Consolidated Statement of Cash Flows Year Ended 31 March 2013
Cash Flows From Operating Activities Profit Before Income tax Depreciation of Plant and Equipment Depreciation of Investment Property Amortisation of Intangible Assets Loss on Disposal of Plant and Equipment Loss on Disposal of Available-For-Sales Financial Assets Gain on Liquidation of Subsidiaries Interest Expense Dividend Income Interest Income Amortisation of Deferred Income Arising From Sale of Leasehold Property Net Effect of Exchange Rate Changes in Consolidating Subsidiaries Operating Cash Flows Before Changes in Working Capital Inventories Trade and Other Receivables Other Financial Assets, Current Other Assets Trade and Other Payables Other Liabilities, Current Net Cash Flows (Used in) / From Operations Income Tax (Paid)/Refunded Net Cash Flows (Used in) / From Operating Activities Cash Flows From Investing Activities Payments for Intangible Assets Purchase of Plant and Equipment Purchase of Other Financial Assets, Non-Current Proceeds From Disposals of Available-For-Sale Financial Assets Cash Restricted in Use Over 3 Months Interest Income Received Dividend Income Received Net Cash Flows From / (Used in) Investing Activities Cash Flows From Financing Activities Interest Expense Paid Dividends Paid to Equity Owners Net Cash Flows Used in Financing Activities Net Decrease in Cash and Cash Equivalents Effect of Exchange Rate Changes on Cash and Cash Equivalents Cash and Cash Equivalents, Consolidated Statement of Cash Flows, Beginning Balance Cash and Cash Equivalents, Consolidated Statement of Cash Flows, Ending Balance (Note 22A)
The accompanying notes form an integral part of these financial statements.
2013 $’000
2012 $’000
622 624 193 61 23 – – – (214) (318) (1,000) 27 18 133 (677) (63) 48 (184) (422) (1,147) (134) (1,281)
1,812 784 193 114 – 53 (3) 2 (180) (197) (1,000) 30 1,608 513 1,587 27 (191) (132) (902) 2,510 46 2,556
(50) (179) – – (80) 318 214 223
(23) (720) (2,000) 2,996 (1,922) 197 180 (1,292)
– (1,733) (1,733)
(2) (1,733) (1,735)
(2,791) 4 14,816
( 471) 80 15,207
12,029
14,816
Powermatic Data Systems Limited Annual Report 2013
Notes to the Financial Statements 31 March 2013
1.
GENERAL Powermatic Data Systems Limited (the “company”) is incorporated in Singapore with limited liability. The financial statements are presented in Singapore dollars and they cover the company (referred to as “parent”) and its subsidiaries. The board of directors approved and authorised these financial statements for issue on the date of the statement of directors. The company is an investment holding company. It is listed on the Singapore Exchange Securities Trading Limited. The principal activities of the subsidiaries are disclosed in Note 16 below. The registered office and principal place of business of the company is located at 135 Joo Seng Road, #08-01, Singapore 368363.
2.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Accounting Convention The financial statements have been prepared in accordance with the Singapore Financial Reporting Standards (“FRS”) and the related Interpretations to FRS (“INT FRS”) as issued by the Singapore Accounting Standards Council and the Companies Act, Chapter 50. The financial statements are prepared on a going concern basis under the historical cost convention except where an FRS requires an alternative treatment (such as fair values) as disclosed where appropriate in these financial statements. Other comprehensive income comprises items of income and expense (including reclassification adjustments) that are not recognised in the income statement, as required or permitted by FRS. Reclassification adjustments are amounts reclassified to profit or loss in the income statement in the current period that were recognised in other comprehensive income in the current or previous periods. Basis of Presentation The consolidated financial statements include the financial statements made up to the end of the reporting year of the company and all of its directly and indirectly controlled subsidiaries. The consolidated financial statements are the financial statements of the group presented as those of a single economic entity and are prepared using uniform accounting policies for like transactions and other events in similar circumstances. All significant intragroup balances and transactions, including profit or loss and other comprehensive income items and dividends are eliminated on consolidation. The results of any subsidiary acquired or disposed of during the reporting year are accounted for from the respective dates of acquisition or up to the date of disposal which is the date on which effective control is obtained of the acquired business, until that control ceases.
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Powermatic Data Systems Limited Annual Report 2013
Notes to the Financial Statements 31 March 2013
cont’d 2.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont’d) Basis of Presentation (Cont’d) Changes in the group’s ownership interest in a subsidiary that do not result in the loss of control are accounted for within equity. When the group loses control of a subsidiary it derecognises the assets and liabilities and related equity components of the former subsidiary. Any gain or loss is recognised in profit or loss. Any investment retained in the former subsidiary is measured at its fair value at the date when control is lost and is subsequently accounted as available-for-sale financial assets in accordance with FRS 39. The company’s financial statements have been prepared on the same basis, and as permitted by the Singapore Companies Act, Chapter 50, no statement of profit or loss and other comprehensive income is presented for the company. Basis of Preparation of the Financial Statements The preparation of financial statements in conformity with generally accepted accounting principles requires the management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting year. Actual results could differ from those estimates. The estimates and assumptions are reviewed on an ongoing basis. Apart from those involving estimations, management has made judgements in the process of applying the entity’s accounting policies. The areas requiring management’s most difficult, subjective or complex judgements, or areas where assumptions and estimates are significant to the financial statements, are disclosed at the end of this note to the financial statements. Segment Reporting The group discloses financial and descriptive information about its reportable segments. Reportable segments are operating segments or aggregations of operating segments that meet specified criteria. Operating segments are components about which separate financial information is available that is evaluated regularly by the chief operating decision maker in deciding how to allocate resources and in assessing performance. Generally, financial information is reported on the same basis as is used internally for evaluating operating segment performance and deciding how to allocate resources to operating segments. Revenue Recognition The revenue amount is the fair value of the consideration received or receivable from the gross inflow of economic benefits during the reporting year arising from the course of the activities of the entity and it is shown net of related sales taxes, estimated returns and rebates. Revenue from sale of goods is recognised when significant risks and rewards of ownership are transferred to the buyer, there is neither continuing managerial involvement to the degree usually associated with ownership nor effective control over the goods sold, and the amount of revenue and the costs incurred or to be incurred in respect of the transaction can be measured reliably. Revenue from rendering of services that are of short duration is recognised when the services are completed. Interest income is recognised using the effective interest method. Dividend income on equity instrument is recognised
Powermatic Data Systems Limited Annual Report 2013
Notes to the Financial Statements 31 March 2013
cont’d 2.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont’d) Revenue Recognition (Cont’d) in profit or loss when the entity’s right to receive payment is established. Rental income from operating leases is recognised in profit or loss on a straight-line basis over the term of the relevant lease unless another systematic basis is representative of the time pattern of the user’s benefit, even if the payments are not on that basis. Initial direct cost incurred in negotiating and arranging an operating lease are added to the carrying amount of the leased asset and recognised on straight-line basis over the lease term. Employee Benefits Contributions to defined contribution retirement benefit plans are recorded as an expense as they fall due. The entity’s legal or constructive obligation is limited to the amount that it agrees to contribute to an independently administered fund such as the Central Provident Fund in Singapore (a government managed retirement benefit plan). For employee leave entitlement the expected cost of short-term employee benefits in the form of compensated absences is recognised in the case of accumulating compensated absences, when the employees render service that increases their entitlement to future compensated absences; and in the case of non-accumulating compensated absences, when the absences occur. A liability for bonuses is recognised where the entity is contractually obliged or where there is constructive obligation based on past practice. Share-Based Compensation For the equity-settled share-based compensation transactions, the fair value of the employee services received in exchange for the grant of the options is recognised as an expense. The total amount to be expensed on a straight-line basis over the vesting period is determined by reference to the fair value of the options granted excluding the effect of non-market conditions such as profitability and sales growth targets. Non-market vesting conditions are included in assumptions about the number of options that are expected to become exercisable. The fair value is measured using the Black-Scholes pricing model. The expected lives used in the model are adjusted, based on management’s best estimate, for the effects of non-transferability, exercise restrictions and behavioural considerations. At each end of the reporting year, a revision is made of the number of options that are expected to become exercisable. It recognises the impact of the revision of original estimates, if any, in profit or loss with a corresponding adjustment to equity. The proceeds received net of any directly attributable transaction costs are credited to share capital when the options are exercised. Cancellations of grants of equity instruments during the vesting period (other than a grant cancelled by forfeiture when the vesting conditions are not satisfied) are accounted for as an acceleration of vesting, therefore any amount unrecognised that would otherwise have been charged is recognised immediately in profit or loss. Income Tax The income taxes are accounted using the asset and liability method that requires the recognition of taxes payable or refundable for the current year and deferred tax liabilities and assets for the future tax consequence of events that have been recognised in the financial statements or tax returns. The measurements of current and deferred tax liabilities and assets are based on provisions of the
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Powermatic Data Systems Limited Annual Report 2013
Notes to the Financial Statements 31 March 2013
cont’d 2.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont’d) Income Tax (Cont’d) enacted or substantially enacted tax laws; the effects of future changes in tax laws or rates are not anticipated. Income tax expense represents the sum of the tax currently payable and deferred tax. Current and deferred income taxes are recognised as income or as an expense in profit or loss unless the tax relates to items that are recognised in the same or a different period outside profit or loss. For such items recognised outside profit or loss, the current tax and deferred tax are recognised (a) in other comprehensive income if the tax is related to an item recognised in other comprehensive income and (b) directly in equity if the tax is related to an item recognised directly in equity. Deferred tax assets and liabilities are offset when they relate to income taxes levied by the same income tax authority. The carrying amount of deferred tax assets is reviewed at each end of the reporting year and is reduced, if necessary, by the amount of any tax benefits that, based on available evidence, are not expected to be realised. A deferred tax amount is recognised for all temporary differences, unless the deferred tax amount arises from the initial recognition of an asset or liability in a transaction which (i) is not a business combination; and (ii) at the time of the transaction, affects neither accounting profit nor taxable profit (tax loss). A deferred tax liability or asset is recognised for all taxable temporary differences associated with investments in subsidiaries except where the reporting entity is able to control the timing of the reversal of the taxable temporary difference and it is probable that the taxable temporary difference will not reverse in the foreseeable future or for deductible temporary differences, they will not reverse in the foreseeable future and they cannot be utilised against taxable profits. Foreign Currency Transactions The functional currency is the Singapore dollar as it reflects the primary economic environment in which the entity operates. Transactions in foreign currencies are recorded in the functional currency at the rates ruling at the dates of the transactions. At each end of the reporting year, recorded monetary balances and balances measured at fair value that are denominated in non-functional currencies are reported at the rates ruling at the end of the reporting year and fair value dates respectively. All realised and unrealised exchange adjustment gains and losses are dealt with in profit or loss except when recognised in other comprehensive income. The presentation is in the functional currency. Translation of Financial Statements of Other Entities Each entity in the group determines the appropriate functional currency as it reflects the primary economic environment in which the relevant reporting entity operates. In translating the financial statements of such an entity for incorporation in the consolidated financial statements in the presentation currency, the assets and liabilities denominated in other currencies are translated at end of the reporting year rates of exchange and the income and expense items for each statement presenting profit or loss and other comprehensive income are translated at average rates of exchange for the reporting year. The resulting translation adjustments (if any) are recognised in other comprehensive income and accumulated in a separate component of equity until the disposal of that relevant reporting entity.
Powermatic Data Systems Limited Annual Report 2013
Notes to the Financial Statements 31 March 2013
cont’d 2.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont’d) Operating Leases Leases where the lessor effectively retains substantially all the risks and benefits of ownership of the leased assets are classified as operating leases. For operating leases, lease payments are recognised as an expense in profit or loss on a straight-line basis over the term of the relevant lease unless another systematic basis is representative of the time pattern of the user’s benefit, even if the payments are not on that basis. Lease incentives received are recognised in profit or loss as an integral part of the total lease expense. Plant and Equipment Depreciation is provided on a straight-line basis to allocate the gross carrying amounts less their residual values over their estimated useful lives of each part of an item of these assets. The annual rates of depreciation are as follows: Leasehold improvements
–
Motor vehicles Furniture, fittings and equipment
– –
Over the lease term of 5 years or the remaining period of the lease 20% 10% to 33%
An asset is depreciated when it is available for use until it is derecognised even if during that period the item is idle. Fully depreciated assets still in use are retained in the financial statements. Plant and equipment are carried at cost on initial recognition and after initial recognition at cost less any accumulated depreciation and any accumulated impairment losses. The gain or loss arising from the derecognition of an item of plant and equipment is determined as the difference between the net disposal proceeds, if any, and the carrying amount of the item and is recognised in profit or loss. The residual value and the useful life of an asset is reviewed at least at each end of the reporting year and, if expectations differ significantly from previous estimates, the changes are accounted for as a change in an accounting estimate, and the depreciation charge for the current and future periods are adjusted. Cost also includes acquisition cost, borrowing cost capitalised and any cost directly attributable to bringing the asset or component to the location and condition necessary for it to be capable of operating in the manner intended by management. Subsequent costs are recognised as an asset only when it is probable that future economic benefits associated with the item will flow to the entity and the cost of the item can be measured reliably. All other repairs and maintenance are charged to profit or loss when they are incurred. Cost includes the initial estimate of the costs of dismantling and removing the item and restoring the site on which it is located, the obligation for which an entity incurs either when the item is acquired or as a consequence of having used the item during a particular period for purposes other than to produce inventories during that period.
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Powermatic Data Systems Limited Annual Report 2013
Notes to the Financial Statements 31 March 2013
cont’d 2.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont’d) Investment Property Investment property is a property owned or held under a finance lease to earn rentals or for capital appreciation or both, rather than for use in the production or supply of goods or services or for administrative purposes or sale in the ordinary course of business. It includes an investment property in the course of construction. After initial recognition at cost including transaction costs, the cost model is used to measure the investment property, that is, at cost less any accumulated depreciation and any accumulated impairment losses. Freehold building is depreciated on a straight-line basis over 38 years and freehold land is not depreciated. An investment property that meets the criteria to be classified as held for sale is carried at the lower of carrying amount and fair value less costs to sell. For disclosure purposes, the fair values are determined periodically on a systematic basis at least once yearly by external independent valuers having an appropriate recognised professional qualification and recent experience in the location and category of property being valued. Intangible Assets An identifiable non-monetary asset without physical substance is recognised as an intangible asset at acquisition cost if it is probable that the expected future economic benefits that are attributable to the asset will flow to the entity and the cost of the asset can be measured reliably. After initial recognition, an intangible asset with finite useful life is carried at cost less any accumulated amortisation and any accumulated impairment losses. An intangible asset with an indefinite useful life is not amortised. An intangible asset is regarded as having an indefinite useful life when, based on an analysis of all of the relevant factors, there is no foreseeable limit to the period over which the asset is expected to generate net cash inflows for the entity. The amortisable amount of an intangible asset with finite useful life is allocated on a systematic basis over the best estimate of its useful life from the point at which the asset is ready for use. The useful lives are as follows: Certification fees Club membership
– 3 years – 22 years
Inventories Inventories are measured at the lower of cost (weighted average method) and net realisable value. Net realisable value is the estimated selling price in the ordinary course of business less the estimated costs of completion and the estimated costs necessary to make the sale. A write-down on cost is made for where the cost is not recoverable or if the selling prices have declined. Cost includes all costs of purchase, costs of conversion and other costs incurred in bringing the inventories to their present location and condition. In the case of manufactured inventories and work-in-progress, cost includes an appropriate share of overheads based on normal operating capacity.
Powermatic Data Systems Limited Annual Report 2013
Notes to the Financial Statements 31 March 2013
cont’d 2.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont’d) Subsidiaries A subsidiary is an entity including unincorporated and special purpose entity that is controlled by the group. Control is the power to govern the financial and operating policies of an entity so as to obtain benefits from its activities accompanying a shareholding of more than one half of the voting rights or the ability to appoint or remove the majority of the members of the board of directors or to cast the majority of votes at meetings of the board of directors. The existence and effect of potential voting rights that are currently exercisable or convertible are considered when assessing whether the group controls another entity. In the company’s own separate financial statements, an investment in a subsidiary is stated at cost adjusted for any value in the contingent consideration less any allowance for impairment in value. Impairment loss recognised in profit or loss for a subsidiary is reversed only if there has been a change in the estimates used to determine the asset’s recoverable amount since the last impairment loss was recognised. The net book value of a subsidiary is not necessarily indicative of the amounts that would be realised in a current market exchange. Business Combinations Business combinations are accounted for by applying the acquisition method. There were none during the reporting year. Non-Controlling Interests The non-controlling interests in the net assets and net results of a consolidated subsidiary are shown separately in the appropriate components of the consolidated financial statements. For each business combination, any non-controlling interest in the acquiree (subsidiary) is initially measured either at fair value or at the non-controlling interest’s proportionate share of the acquiree’s identifiable net assets. Where the non-controlling interest is measured at fair value, the valuation techniques and key model inputs used are disclosed in the relevant note to the financial statement. Losses applicable to the non-controlling interest in excess of the non-controlling interest’s interest in the subsidiary’s equity are not allocated against the interests of the owners of the parent. Impairment of Non-Financial Assets The carrying amount of non-financial assets is reviewed at each end of the reporting year for indications of impairment and where an asset is impaired, it is written down through profit or loss to its estimated recoverable amount. The impairment loss is the excess of the carrying amount over the recoverable amount and is recognised in profit or loss. The recoverable amount of an asset or a cash-generating unit is the higher of its fair value less costs to sell and its value in use. When the fair value less costs to sell method is used, any available recent market transactions are taken into consideration. When the value in use method is adopted, in assessing the value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. For the purposes of assessing impairment, assets are grouped at the lowest levels for which there are separately identifiable cash flows (cash-generating units). At each end of the reporting year nonfinancial assets other than goodwill with impairment loss recognised in prior periods are assessed for possible reversal of the impairment. An impairment loss is reversed only to the extent that the asset’s 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.
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Powermatic Data Systems Limited Annual Report 2013
Notes to the Financial Statements 31 March 2013
cont’d 2.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont’d) Financial Assets Initial recognition, measurement and derecognition: A financial asset is recognised on the statement of financial position when, and only when, the entity becomes a party to the contractual provisions of the instrument. The initial recognition of financial assets is at fair value normally represented by the transaction price. The transaction price for financial asset not classified at fair value through profit or loss includes the transaction costs that are directly attributable to the acquisition or issue of the financial asset. Transaction costs incurred on the acquisition or issue of financial assets classified at fair value through profit or loss are expensed immediately. The transactions are recorded at the trade date. Irrespective of the legal form of the transactions performed, financial assets are derecognised when they pass the “substance over form” based on the derecognition test prescribed by FRS 39 relating to the transfer of risks and rewards of ownership and the transfer of control. Subsequent measurement: Subsequent measurement based on the classification of the financial assets in one of the following four categories under FRS 39 is as follows: #1.
Financial assets at fair value through profit or loss: Assets are classified in this category where the financial asset is either held for trading or it is designated upon initial recognition at fair value through profit or loss. Financial assets that are classified as held for trading if they are incurred principally for the purpose of selling or repurchasing in the near term (trading assets) or are derivatives (except for a derivative that is a designated and effective hedging instrument). Financial assets (other than held for trading) are classified in this category if the conditions in FRS 39 are met to use the “fair value option” and it is used. These assets are carried at fair value by reference to the transaction price or current bid prices in an active market. All changes in fair value relating to assets at fair value through profit or loss are recognised directly in profit or loss. They are classified as non-current assets unless management intends to dispose of the asset within 12 months of the end of the reporting year.
#2.
Loans and receivables: Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market. Assets that are for sale immediately or in the near term are not classified in this category. These assets are carried at amortised costs using the effective interest method (except that short-duration receivables with no stated interest rate are normally measured at original invoice amount unless the effect of imputing interest would be significant) minus any reduction (directly or through the use of an allowance account) for impairment or uncollectibility. Impairment charges are provided only when there is objective evidence that an impairment loss has been incurred as a result of one or more events that occurred after the initial recognition of the asset (a ‘loss event’) and that loss event (or events) has an impact on the estimated future cash flows of the financial asset or group of financial assets that can be reliably estimated. The methodology ensures that an impairment loss is not recognised on the initial recognition of an asset. Losses expected as a result of future events, no matter how likely, are not recognised. For impairment, the carrying amount of the asset is reduced through use of an allowance account. The amount of the loss is recognised in profit or loss. An impairment loss is reversed if the reversal can be related objectively to an event occurring after the impairment loss was recognised. Typically the trade and other receivables are classified in this category.
Powermatic Data Systems Limited Annual Report 2013
Notes to the Financial Statements 31 March 2013
cont’d 2.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont’d) Financial Assets (Cont’d) Subsequent measurement (cont’d): #3.
Held-to-maturity financial assets: These are non-derivative financial assets with fixed or determinable payments and fixed maturity that the entity has the positive intention and ability to hold to maturity. Financial assets that upon initial recognition are designated as at fair value through profit or loss or available-for-sale and those that meet the definition of loans and receivables are not classified in this category. These assets are carried at amortised costs using the effective interest method minus any reduction (directly or through the use of an allowance account) for impairment or uncollectibility. Impairment charges are provided only when there is objective evidence that an impairment loss has been incurred. If that is the case, the carrying amount of the asset is reduced through use of an allowance account. The gains and losses are recognised in profit or loss when the investments are derecognised or impaired, as well as through the amortisation process. Impairment losses recognised in profit or loss are subsequently reversed if an increase in the fair value of the instrument can be objectively related to an event occurring after the recognition of the impairment loss. Long-term investments in bonds and debt securities are classified in this category.
#4.
Available-for-sale financial assets: These are non-derivative financial assets that are designated as available-for-sale on initial recognition or are not classified in one of the previous categories. These assets are carried at fair value. Changes in fair value of available-for-sale financial assets (other than those relating to foreign exchange translation differences on monetary investments) are recognised in other comprehensive income and accumulated in a separate component of equity under the heading revaluation reserves. Such reserves are reclassified to profit or loss when realised through disposal. When there is objective evidence that the asset is impaired, the cumulative loss is reclassified from equity to profit or loss as a reclassification adjustment. A significant or prolonged decline in the fair value of the investment below its cost is considered to be objective evidence of impairment. If, in a subsequent period, the fair value of an equity instrument classified as available-for-sale increases and the increase can be objectively related to an event occurring after the impairment loss, it is reversed against revaluation reserves and is not subsequently reversed through profit or loss. However for debt instruments classified as available-for-sale impairment losses recognised in profit or loss are subsequently reversed if an increase in the fair value of the instrument can be objectively related to an event occurring after the recognition of the impairment loss. The weighted average method is used when determining the cost basis of publicly listed equities being disposed of. For non-equity instruments classified as available-for-sale the reversal of impairment is recognised in profit or loss. These financial assets are classified as noncurrent assets unless management intends to dispose of the investments within 12 months of the end of the reporting year. Usually non-current investments in equity shares and debt securities are classified in this category but it does not include subsidiaries, joint ventures, or associates. Unquoted investments are stated at cost less allowance for impairment in value where there are no market prices, and management is unable to establish fair value by using valuation techniques except that where management can establish fair value by using valuation techniques the relevant unquoted investments are stated at fair value. For unquoted equity instruments impairment losses are not reversed.
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Powermatic Data Systems Limited Annual Report 2013
Notes to the Financial Statements 31 March 2013
cont’d 2.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont’d) Financial Assets (Cont’d) Subsequent measurement (cont’d): Cash and Cash Equivalents Cash and cash equivalents include bank and cash balances, on demand deposits and any highly liquid debt instruments purchased with an original maturity of three months or less. For the consolidated statement of cash flows, the item includes cash and cash equivalents less cash subject to restriction and bank overdrafts payable on demand that form an integral part of cash management, if any. Financial Liabilities Initial recognition and measurement and derecognition: A financial liability is recognised on the statement of financial position when, and only when, the entity becomes a party to the contractual provisions of the instrument and it is derecognised when the obligation specified in the contract is discharged or cancelled or expires. The initial recognition of financial liability is at fair value normally represented by the transaction price. The transaction price for financial liability not classified at fair value through profit or loss includes the transaction costs that are directly attributable to the acquisition or issue of the financial liability. Transaction costs incurred on the acquisition or issue of financial liability classified at fair value through profit or loss are expensed immediately. The transactions are recorded at the trade date. Financial liabilities are classified as current liabilities unless there is an unconditional right to defer settlement of the liability for at least 12 months after the end of the reporting year. Subsequent measurement: Subsequent measurement based on the classification of the financial liabilities in one of the following two categories under FRS 39 is as follows: #1.
Liabilities at fair value through profit or loss: Liabilities are classified in this category when they are incurred principally for the purpose of selling or repurchasing in the near term (trading liabilities) or are derivatives (except for a derivative that is a designated and effective hedging instrument) or have been classified in this category because the conditions are met to use the “fair value option” and it is used. Financial guarantee contracts if significant are initially recognised at fair value and are subsequently measured at the greater of (a) the amount determined in accordance with FRS 37 and (b) the amount initially recognised less, where appropriate, cumulative amortisation recognised in accordance with FRS 18. All changes in fair value relating to liabilities at fair value through profit or loss are charged to profit or loss as incurred.
#2.
Other financial liabilities: All liabilities, which have not been classified in the previous category fall into this residual category. These liabilities are carried at amortised cost using the effective interest method. Trade and other payables and borrowings are usually classified in this category. Items classified within current trade and other payables are not usually remeasured, as the obligation is usually known with a high degree of certainty and settlement is short-term.
Powermatic Data Systems Limited Annual Report 2013
Notes to the Financial Statements 31 March 2013
cont’d 2.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont’d) Fair Value of Financial Instruments The carrying values of current financial instruments approximate their fair values due to the shortterm maturity of these instruments and the disclosures of fair value are not made when the carrying amount of current financial instruments is a reasonable approximation of the fair value. The fair values of non-current financial instruments may not be disclosed separately unless there are significant differences at the end of the reporting year and in the event the fair values are disclosed in the relevant notes. The fair value of a financial instrument is derived from an active market or by using an acceptable valuation technique. The appropriate quoted market price for an asset held or liability to be issued is usually the current bid price without any deduction for transaction costs that may be incurred on sale or other disposal and, for an asset to be acquired or liability held, the asking price. If there is no market, or the markets available are not active, the fair value is established by using an acceptable valuation technique. The fair value measurements are classified using a fair value hierarchy of 3 levels that reflects the significance of the inputs used in making the measurements, that is, Level 1 for the use of quoted prices (unadjusted) in active markets for identical assets or liabilities; Level 2 for the use of inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e., as prices) or indirectly (i.e., derived from prices); and Level 3 for the use of inputs for the asset or liability that are not based on observable market data (unobservable inputs). The level is determined on the basis of the lowest level input that is significant to the fair value measurement in its entirety. Where observable inputs that require significant adjustment based on unobservable inputs, that measurement is a Level 3 measurement. The maximum exposure to credit risk is: the total of the fair value of the financial assets; the maximum amount the entity could have to pay if the guarantee is called on; and the full amount of any payable commitments at the end of the reporting year. Equity Equity instruments are contracts that give a residual interest in the net assets of the company. Ordinary shares are classified as equity. Equity instruments are recognised at the amount of proceeds received net of incremental costs directly attributable to the transaction. Dividends on equity are recognised as liabilities when they are declared. Interim dividends are recognised when declared by the directors. Provisions A liability or provision is recognised when there is a present obligation (legal or constructive) as a result of a past event, 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. Provisions are made using best estimates of the amount required in settlement and where the effect of the time value of money is material, the amount recognised is the present value of the expenditures expected to be required to settle the obligation using a pre-tax rate that reflects current market assessments of the time value of money and the risks specific to the obligation. The increase in the provision due to passage of time is recognised as interest expense. Changes in estimates are reflected in profit or loss in the reporting year they occur.
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Powermatic Data Systems Limited Annual Report 2013
Notes to the Financial Statements 31 March 2013
cont’d 2.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont’d) Critical Judgements, Assumptions and Estimation Uncertainties The critical judgements made in the process of applying the accounting policies that have the most significant effect on the amounts recognised in the financial statements and the key assumptions concerning the future, and other key sources of estimation uncertainty at the end of the reporting year, that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next reporting year are discussed below. These estimates and assumptions are periodically monitored to ensure they incorporate all relevant information available at the date when financial statements are prepared. However, this does not prevent actual figures differing from estimates. Determination of functional currency: The group measures foreign currency transactions in the respective functional currencies of the company and its subsidiaries. In determining the functional currencies of the entities in the group, judgement is required to determine the currency that mainly influences sales prices for goods and services and of the country whose competitive forces and regulations mainly determines the sales prices of its goods and services. The functional currencies of the entities in the group are determined based on management’s assessment of the economic environment in which the entities operate and the entities’ process of determining sales prices. Allowance for doubtful trade accounts: An allowance is made for doubtful trade accounts for estimated losses resulting from the subsequent inability of the customers to make required payments. If the financial conditions of the customers were to deteriorate, resulting in an impairment of their ability to make payments, additional allowances may be required in future periods. Management generally analyses trade receivables and historical bad debts, customer concentrations, and customer creditworthiness when evaluating the adequacy of the allowance for doubtful trade receivables. To the extent that it is feasible, impairment and uncollectibility is determined individually for each item. In cases where that process is not feasible, a collective evaluation of impairment is performed. At the end of the reporting year, the trade receivables carrying amount approximates the fair value and the carrying amounts might change materially within the next reporting year but these changes would not arise from assumptions or other sources of estimation uncertainty at the end of the reporting year. The carrying amount is disclosed in the Note on trade and other receivables. Net realisable value of inventories: A review is made periodically on inventory for excess inventory and declines in net realisable value below cost and an allowance is recorded against the inventory balance for any such declines. These reviews require management to consider the future demand for the products. In any case the realisable value represents the best estimate of the recoverable amount and is based on the acceptable evidence available at the end of the reporting year and inherently involves estimates regarding the future expected realisable value. The usual considerations for determining the amount of allowance or write-down include ageing analysis, technical assessment and subsequent events. In general, such an evaluation process requires significant judgement and materially affects the carrying amount of inventories at the end of the reporting year. Possible changes in these estimates could result in revisions to the stated value of the inventories. The carrying amount of inventories of the group at the end of the reporting year was $1,209,000 (2012: $1,342,000).
Powermatic Data Systems Limited Annual Report 2013
Notes to the Financial Statements 31 March 2013
cont’d 2.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont’d) Critical Judgements, Assumptions and Estimation Uncertainties (Cont’d) Useful lives of plant and equipment: The estimates for the useful lives and related depreciation charges for plant and equipment is based on commercial and production factors which could change significantly as a result of technical innovations and competitor actions in response to severe market conditions. The depreciation charge is increased where useful lives are less than previously estimated lives, or the carrying amounts written-off or written-down for technically obsolete or non-strategic assets that have been abandoned or sold. It is impracticable to disclose the extent of the possible effects. It is reasonably possible, based on existing knowledge, that outcomes within the next financial year that are different from assumptions could require a material adjustment to the carrying amount of the balances affected. The carrying amount of the plant and equipment of the group at the end of the reporting year was $709,000 (2012: $1,183,000). Income tax: The group recognises tax liabilities and tax assets based on an estimation of the likely taxes due, which requires significant judgement as to the ultimate tax determination of certain items. There are certain transactions and computations for which the ultimate determination is uncertain during the ordinary course of business as the administration, enforcement and interpretation of complex tax laws and regulations may be subject to uncertainties and a certain degree of discretion by the local tax authorities. Where the actual amount arising from these issues differs from those estimates made by the company, such differences may have a material impact on income tax and deferred tax amounts in the period when such determination is made. The amounts are disclosed in Note 10.
3.
RELATED PARTY RELATIONSHIPS AND TRANSACTIONS FRS 24 defines a related party as a person or entity that is related to the reporting entity and it includes (a) A person or a close member of that person’s family if that person: (i) has control or joint control over the reporting entity; (ii) has significant influence over the reporting entity; or (iii) is a member of the key management personnel of the reporting entity or of a parent of the reporting entity. (b) An entity is related to the reporting entity if any of the following conditions apply: (i) The entity and the reporting entity are members of the same group. (ii) One entity is an associate or joint venture of the other entity. (iii) Both entities are joint ventures of the same third party. (iv) One entity is a joint venture of a third entity and the other entity is an associate of the third entity. (v) The entity is a post-employment benefit plan for the benefit of employees of either the reporting entity or an entity related to the reporting entity. (vi) The entity is controlled or jointly controlled by a person identified in (a). (vii) A person identified in (a) (i) has significant influence over the entity or is a member of the key management personnel of the entity (or of a parent of the entity). The ultimate controlling party is Dr Chen Mun, the company’s Chairman and Chief Executive Officer.
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Powermatic Data Systems Limited Annual Report 2013
Notes to the Financial Statements 31 March 2013
cont’d 3.
RELATED PARTY RELATIONSHIPS AND TRANSACTIONS (Cont’d) 3.1
Related companies: Related companies in these financial statements include the members of the company. There are transactions and arrangements between the reporting entity and members of the group and the effects of these on the basis determined between the parties are reflected in these financial statements. The current related company balances are unsecured without fixed repayment terms and interest unless stated otherwise. Intragroup transactions and balances that have been eliminated in these consolidated financial statements are not disclosed as related party transactions and balances below.
3.2.
Key management compensation: Group
Salaries and other short-term employee benefits
2013 $’000
2012 $’000
904
877
The above amount is included under employee benefits expense. Included in the above amount are the following items: Group
Remuneration of directors of the company Fees to directors of the company
2013 $’000
2012 $’000
411 42
289 42
Further information about the remuneration of individual directors is provided in the Report on Corporate Governance. Key management personnel are the directors and those persons having authority and responsibility for planning, directing and controlling the activities of the companies in the group, directly or indirectly. The above amounts for key management compensation are for all the directors of the company and of a subsidiary. A subsidiary ceased outsourcing its sales director function to a corporate entity with effect from 1st July 2011 and there was no consultancy fee expense during the reporting year (2012: $38,000).
Powermatic Data Systems Limited Annual Report 2013
Notes to the Financial Statements 31 March 2013
cont’d 4.
FINANCIAL INFORMATION BY OPERATING SEGMENTS
4A.
Information about Reportable Segment Profit or Loss, Assets and Liabilities Disclosure of information about operating segments, products and services, the geographical areas, and the major customers are made as required by FRS 108 Operating Segments. This disclosure standard has no impact on the reported results of financial position of the group. For management purposes, the group is organised into three major operating segments: network products, distribution and property. Such structural organisation is determined by the nature of risks and returns associated with each business segment and it defines the management structure as well as the internal reporting system. It represents the basis on which the management reports the primary segment information. They are managed separately because each business requires different strategies. The segments are as follows: Network Products segment comprises manufacturing, sales, marketing and distribution of wired and wireless network products. Distribution segment comprises sales, marketing, assembly and distribution of computer and computer parts and peripherals. Property segment comprises managing the investment properties. Inter-segment sales during the reporting year was $6,000 (2012: NIL).
49
50
Powermatic Data Systems Limited Annual Report 2013
Notes to the Financial Statements 31 March 2013
cont’d 4.
FINANCIAL INFORMATION BY OPERATING SEGMENTS (Cont’d)
4B.
Primary Analysis by Business Segment The following tables illustrate the information about the reportable segment profit or loss, assets and liabilities:
Group: 2013 Revenue by segment Cost of sales Gross profit Other Items of Income Property income Property expense Profit from property Interest income Dividend income Other credits Other Items of Expenses Distribution cost Administration expenses Other operating expenses Finance cost Other charges Profit before income tax Income tax income/(expense) Profit, net of tax Non-controlling interests Profit, net of tax attributable to the parent Segment assets Segment liabilities Other segment information: Recovery of bad debt Allowance for doubtful debts Capital expenditure Depreciation of plant and equipment Depreciation of investment property Amortisation of intangible assets Service income
Network Products (LAN) $’000 9,313 (6,453) 2,860
– – – 206 – 26
(1,119) (1,230) (33) – (66) 644 61 705 – 705
Distribution (DIST) $’000 3,887 (3,245) 642
– – – – – 233
Property $’000 – – –
4,151 (3,758) 393 – – –
Others (corporate holding) $’000 – – –
Total $’000 13,200 (9,698) 3,502
– – – 112 214 82
4,151 (3,758) 393 318 214 341
(1,599) (2,409) (33) (2) (103) 622 49 671 (45)
(480) (377) – (4) (40) (26) (12) (38) (45)
– – – – – 393 – 393 –
– (802) – 2 3 (389) – (389) –
(83)
393
(389)
626
12,404 (1,811)
1,248 (464)
15,465 (184)
18,777 (747)
47,894 (3,206)
– – (179) (378) – (61) 276
228 (8) – – – – 120
– – – (234) (193) – –
– – – (12) – – –
228 (8) (179) (624) (193) (61) 396
Powermatic Data Systems Limited Annual Report 2013
Notes to the Financial Statements 31 March 2013
cont’d 4.
FINANCIAL INFORMATION BY OPERATING SEGMENTS (Cont’d)
4B.
Primary Analysis by Business Segment (Cont’d)
Group: 2012 Revenue by segment Cost of sales Gross profit Other Items of Income Property income Property expense Profit from property Interest income Dividend income Other credits Other Items of Expenses Distribution cost Administration expenses Other operating expenses Finance cost Other charges Profit before income tax Income tax income Profit, net of tax Non-controlling interests Profit, net of tax attributable to the parent Segment assets Segment liabilities Other segment information: Allowance for doubtful debts Capital expenditure Depreciation of plant and equipment Depreciation of investment property Amortisation of intangible assets Service income
Network Products (LAN) $’000 11,563 (7,963) 3,600
– – – 102 – 332
Distribution (DIST) $’000 6,565 (5,453) 1,112
– – – – – 12
Property $’000 – – –
4,188 (3,918) 270 – – –
Others (corporate holding) $’000 – – –
Total $’000 18,128 (13,416) 4,712
– – – 95 180 (127)
4,188 (3,918) 270 197 180 217
(979) (1,170) (14) – – 1,871 215 2,086 –
(364) (488) – (3) (14) 255 56 311 43
– – – – – 270 – 270 –
– (652) – – (80) (584) – (584) –
(1,343) (2,310) (14) (3) (94) 1,812 271 2,083 43
2,086
354
270
(584)
2,126
14,182 (2,247)
1,113 (501)
– (324)
169 –
20,056 (2,054)
14,913 (194)
50,264 (4,996)
– (380)
– (16)
169 (720)
(491)
(4)
(266)
(24)
(785)
– (113) 119
– – 74
(193) – –
(193) – –
(386) (113) 193
51
52
Powermatic Data Systems Limited Annual Report 2013
Notes to the Financial Statements 31 March 2013
cont’d 4.
FINANCIAL INFORMATION BY OPERATING SEGMENTS (Cont’d)
4C.
Geographical Information The following table provides an analysis of the revenue by geographical location or customers, irrespective of the origin of the goods/services: Group
Revenue: Singapore Europe Asia (except Singapore) United States of America Others
2013 $’000
2012 $’000
3,466 4,837 2,814 1,538 545 13,200
5,575 5,560 4,906 1,395 692 18,128
The property income is from properties in Singapore. The following is an analysis of the carrying amount of segment assets, and additions to plant and equipment, intangible assets and investment property analysed by the geographical area in which the assets are located: Group
Segment Assets: Singapore United States of America Asia (except Singapore)
2013 $’000
2012 $’000
40,862 7 7,025 47,894
44,115 9 6,139 50,263
8 171 179
401 319 720
Capital Expenditure: Singapore Asia (except Singapore)
4D.
Information About Major Customers Revenue from one major customer amount to $1,399,000 (2012: $2,890,000) arising from sales by the network products segment.
Powermatic Data Systems Limited Annual Report 2013
Notes to the Financial Statements 31 March 2013
cont’d 5.
REVENUE Group
Sale of goods Service and sundry income
6.
2013 $’000
2012 $’000
12,803 397 13,200
17,991 137 18,128
PROPERTY INCOME Group
Rental and services income from: − Investment property − Property under operating lease
7.
2013 $’000
2012 $’000
1,223 2,928 4,151
1,272 2,916 4,188
PROPERTY EXPENSES Group
Rental expense Building maintenance expense Depreciation expense Utilities and other expenses
2013 $’000
2012 $’000
1,821 973 427 537 3,758
1,911 954 459 594 3,918
53
54
Powermatic Data Systems Limited Annual Report 2013
Notes to the Financial Statements 31 March 2013
cont’d 8.
OTHER CREDITS AND (OTHER CHARGES) Group 2013 $’000 Allowance for impairment on trade receivables Foreign exchange adjustment (losses)/gains, net Fair value gain/(loss) on other financial assets, current Gain on liquidation of subsidiaries Government grant income from SME grant Loss on disposal of plant and equipment Loss on disposal of available-for-sale financial asset, non-current Recovery of bad debt Sundry income Total Presented in profit or loss as: Other credits Other charges Net
9.
2012 $’000
(8) (72) 63 – 17 (23) – 228 33 238
(14) 73 (27) 3 5 – (53) – 136 123
341 (103) 238
217 (94) 123
EMPLOYEE BENEFITS EXPENSE Group
Employee benefits expense including directors: Salaries, bonuses and other short-term benefits Contributions to defined contribution plan Total employee benefits expense
2013 $’000
2012 $’000
2,564 264 2,828
2,217 243 2,460
Powermatic Data Systems Limited Annual Report 2013
Notes to the Financial Statements 31 March 2013
cont’d 10.
INCOME TAX EXPENSE
10A.
Components of tax expense recognised in profit or loss include: Group 2013 $’000
2012 $’000
Current tax (income)/expense: Current tax expense Over adjustments to current tax in respect of prior years Subtotal
41 (90) (49)
219 (423) (204)
Deferred tax income: Deferred tax income Total income tax income
– (49)
(67) (271)
The income tax in profit or loss varied from the amount determined by applying the Singapore income tax rate of 17% (2012: 17%) to profit before income tax as a result of the following differences: Group 2013 $’000
2012 $’000
Profit before income tax
622
1,812
Income tax expense at statutory rate Effect of different tax rates in different countries Non-taxable (non-deductible) items Tax exemptions Over adjustments to current tax in respect of prior years Prior year’s unrecorded tax losses carryforward utilised Other minor items less than 3% each Total income tax income
106 (14) (42) (39) (90) – (30) (49)
308 (16) 23 (26) (423) (149) 12 (271)
There are no income tax consequences of dividends to owners of the company.
55
56
Powermatic Data Systems Limited Annual Report 2013
Notes to the Financial Statements 31 March 2013
cont’d 10.
INCOME TAX EXPENSE (Cont’d)
10B.
Deferred tax income recognised in profit or loss includes: Group 2013 $’000
2012 $’000
–
67
Tax loss carryforwards 10C.
Deferred tax balance in the statement of financial position: Group 2013 $’000
2012 $’000
67
67
Deferred tax asset recognised in profit or loss: Tax loss carryforwards
Temporary differences arising in connection with interests in subsidiaries are insignificant. 10D.
Unrecognised deferred tax assets: Group 2013
Tax loss carryforwards
2012
Gross amount $’000
Tax effect $’000
Gross amount $’000
Tax effect $’000
8,036
1,533
8,066
1,506
No deferred tax asset has been recognised in respect of the above balance as the future profit streams are not probable. The realisation of the future income tax benefits from these tax loss carryforwards is available for an unlimited future period subject to the conditions imposed by laws of the countries in which the companies in the group operate including the retention of majority shareholders as defined.
Powermatic Data Systems Limited Annual Report 2013
Notes to the Financial Statements 31 March 2013
cont’d 11.
EARNING PER SHARE The following table illustrates the numerators and denominators used to calculate basic and diluted earnings per share of no par value: Group
Profit, net of tax attributable to owners of the parent
2013 $’000
2012 $’000
626
2,126
Number of shares: 2013 2012 ’000 ’000 Weighted average number of equity shares
173,289
173,289
The weighted average number of equity shares refers to shares in circulation during the reporting year. Basic earnings per share are calculated by dividing profit, net of tax attributable to owners of the parent by the weighted average number of ordinary shares outstanding during each reporting year. Diluted earnings per share are calculated by dividing profit, net of tax attributable to owners of the parent by the weighted average number of ordinary shares outstanding during each reporting year and the weighted average number of ordinary shares that would be issued on the conversion of all share options (potential dilutive ordinary shares) into ordinary shares. Dilutive earnings per share for the reporting years are computed using the same basis as basic earnings per share as the dilutive effect of the share options is not significant.
12.
DIVIDENDS ON EQUITY SHARES Group and Company 2013 2012 $’000 $’000 Final tax exempt (one-tier) dividend paid of 1 cent (2012: 1 cent) per share
1,733
1,733
In respect of the current year, the directors propose that a final dividend of 1 cent per share with a total of $1,733,000 be paid to shareholders after the annual general meeting planned for 25 July 2013. There are no income tax consequences. This dividend is subject to approval by shareholders at the next annual general meeting and has not been included as a liability in these financial statements. The proposed dividend for 2013 is payable in respect of all ordinary shares in issue at the end of the reporting year and including the new qualifying shares issued up to the date the dividend becomes payable.
57
58
Powermatic Data Systems Limited Annual Report 2013
Notes to the Financial Statements 31 March 2013
cont’d 13.
PLANT AND EQUIPMENT
Group: Cost: At 1 April 2011 Foreign exchange adjustments Additions Disposals At 31 March 2012 Foreign exchange adjustments Additions Disposals At 31 March 2013
Leasehold improvements $’000
Motor vehicles $’000
Furniture, fittings and equipment $’000
Total $’000
120 – 380 – 500 – – – 500
94 – – (9) 85 – – – 85
3,914 78 340 (731) 3,601 (1) 179 (359) 3,420
4,128 78 720 (740) 4,186 (1) 179 (359) 4,005
Accumulated depreciation: At 1 April 2011 Foreign exchange adjustments Depreciation for the year Disposals At 31 March 2012 Foreign exchange adjustments Depreciation for the year Disposals At 31 March 2013
72 – 236 – 308 – 192 – 500
78 9 7 (9) 85 – – – 85
2,730 70 541 (731) 2,610 4 432 (335) 2,711
2,880 79 784 (740) 3,003 4 624 (335) 3,296
Net book value: At 1 April 2011 At 31 March 2012 At 31 March 2013
48 192 –
16 – –
1,184 991 709
1,248 1,183 709
Powermatic Data Systems Limited Annual Report 2013
Notes to the Financial Statements 31 March 2013
cont’d 13.
PLANT AND EQUIPMENT (Cont’d)
Company: Cost: At 1 April 2011 Additions Disposal At 31 March 2012 Additions At 31 March 2013
Leasehold improvements $’000
Motor vehicles $’000
Furniture, fittings and equipment $’000
Total $’000
120 380 – 500 – 500
85 – – 85 – 85
1,449 15 (682) 782 (118) 664
1,654 395 (682) 1,367 (118) 1,249
Accumulated depreciation: At 1 April 2011 Depreciation for the year Disposal At 31 March 2012 Depreciation for the year Disposal At 31 March 2013
72 236 – 308 192 – 500
69 16 – 85 – – 85
1,336 38 (682) 692 53 (118) 627
1,477 290 (682) 1,085 245 (118) 1,212
Net book value: At 31 March 2011 At 31 March 2012 At 31 March 2013
48 192 –
16 – –
113 90 37
177 282 37
The depreciation expense for the group is charged as follows: Group
Cost of sales Property expenses Administrative expenses
2013 $’000
2012 $’000
335 234 55 624
458 266 60 784
Fully depreciated leasehold improvements still in use had a cost of $500,000 (2012: $500,000).
59
60
Powermatic Data Systems Limited Annual Report 2013
Notes to the Financial Statements 31 March 2013
cont’d 14.
INVESTMENT PROPERTY
Group and Company: Cost: At 1 April 2011, 31 March 2012 and 31 March 2013
Freehold land $’000
Freehold building $’000
Total $’000
12,000
7,343
19,343
– – – – –
290 193 483 193 676
290 193 483 193 676
12,000 12,000 12,000
7,053 6,860 6,667
19,053 18,860 18,667
Accumulated depreciation: At 1 April 2011 Depreciation for the year At 31 March 2012 Depreciation for the year At 31 March 2013 Net book value: At 1 April 2011 At 31 March 2012 At 31 March 2013 Fair values: 31 March 2012 31 March 2013
33,000 32,400 Group and Company 2013 2012 $’000 $’000
Rental and service income from investment property Direct operating expenses (including repairs and maintenance) arising from investment property that generated rental income
1,223
1,272
691
688
The depreciation expense is charged under property expenses. The investment property is two-adjoining six-storey semi-detached industrial buildings located at Nos. 7 and 9 Harrison Road, Singapore 369650/1. It is leased out under operating leases. Also see Note 30 on operating lease income commitments. The fair values at the end of the reporting years were based on desk top valuation made by Colliers International Consultancy & Valuation, a firm of independent professional valuers, using the direct comparison and land residual method on 31 March 2013 and 31 March 2012. The fair values are regarded as the lowest level for fair value measurement as the valuation includes inputs for the asset that are not based on observable market data (unobservable inputs).
Powermatic Data Systems Limited Annual Report 2013
Notes to the Financial Statements 31 March 2013
cont’d 15.
INTANGIBLE ASSETS
Group:
Club membership $’000
Certification fees $’000
Total $’000
Cost: At 1 April 2011 Additions At 31 March 2012 Additions At 31 March 2013
60 – 60 – 60
328 23 351 50 401
388 23 411 50 461
Accumulated amortisation: At 1 April 2011 Amortisation for the year At 31 March 2012 Amortisation for the year At 31 March 2013
41 1 42 1 43
162 113 275 60 335
203 114 317 61 378
Net book value: At 1 April 2011 At 31 March 2012 At 31 March 2013
19 18 17
166 76 66
185 94 83
Certification fees are for registration of new products in various countries.
Company:
Club membership $’000
Cost: At 1 April 2011, 31 March 2012 and 31 March 2013
60
Accumulated amortisation: At 1 April 2011 Amortisation for the year At 31 March 2012 Amortisation for the year At 31 March 2013
41 1 42 1 43
Net book value: At 1 April 2011 At 31 March 2012 At 31 March 2013
19 18 17
61
62
Powermatic Data Systems Limited Annual Report 2013
Notes to the Financial Statements 31 March 2013
cont’d 16.
INVESTMENTS IN SUBSIDIARIES Company 2013 $’000
2012 $’000
22,876 (16,988) 5,888
22,876 (16,988) 5,888
9,469
10,502
Movement in cost during the reporting year: Balance at beginning of the year Liquidation Balance at end of the year
22,876 – 22,876
22,880 (4) 22,876
Movements in allowance for impairment loss: Balance at beginning of the year Liquidation of subsidiary Reversed to profit or loss of the company Balance at end of the year
16,988 – – 16,988
17,481 (3) (490) 16,988
Unquoted equity shares, at cost Less: Allowance for impairment Net carrying amount Net book value of subsidiaries
Analysis of above amount denominated in functional and non-functional currencies. Functional currency: Singapore Dollars Non-functional currency: US Dollars Malaysia Ringgit Chinese RMB Others
6,569
6,569
12,154 321 3,829 2 22,876
12,154 321 3,829 2 22,876
The subsidiaries held by the company and its subsidiaries are listed below: Name of subsidiaries, country of incorporation, place of operations and principal activities (and independent auditors)
Cost
Equity Held 2013 2012
2013
2012
$’000
$’000
%
%
Compex Systems Pte Ltd (a) Singapore Trader of computers and related peripherals
1,569
1,569
100
100
Powermatic Distribution Pte Ltd (a) Singapore Distributor of computers and related peripherals
5,000
5,000
100
100
Compex (Suzhou) Co., Ltd (b) People’s Republic of China Manufacturer of computers and related peripherals
3,714
3,714
100
100
Powermatic Data Systems Limited Annual Report 2013
Notes to the Financial Statements 31 March 2013
cont’d 16.
INVESTMENT IN SUBSIDIARIES (Cont’d) Name of subsidiaries, country of incorporation, place of operations and principal activities (and independent auditors)
Cost 2013
2012
$’000
$’000
Compex Wireless (Suzhou) Co., Ltd (c) People’s Republic of China Trader of computers and related peripherals
115
PM Distribution Sdn Bhd (d) Malaysia Investment holding and distributor of computer and related peripherals (SC Lim, Ng & Co., Malaysia) Powermatic Data Systems (HK) Ltd (d) Hong Kong Dormant (East Asia Sentinel Limited, Hongkong) Compex Inc (e) United States of America Trader of computers and related peripherals PM Data Sdn Bhd (d) Malaysia Distributor of computer and related peripherals (SC Lim, Ng & Co., Malaysia)
Equity Held 2013 2012 %
%
115
100
100
321
321
75.8
75.8
2
2
99.9
99.9
12,155
12,155
100
100
– (f)
– (f)
100
100
– (f)
– (f)
100
100
Held through PM Distribution Sdn Bhd: Virtualroute Sdn Bhd (d) (g) Malaysia Computer system integrator and distributor of computers and related peripherals (Chuah Kim Seng & Co., Malaysia)
63
64
Powermatic Data Systems Limited Annual Report 2013
Notes to the Financial Statements 31 March 2013
cont’d 16.
INVESTMENT IN SUBSIDIARIES (Cont’d) (a)
Audited by RSM Chio Lim LLP.
(b)
Audited by RSM China CPA Firm Shanghai International Division, a member firm of RSM International of which RSM Chio Lim LLP in Singapore is a member.
(c)
Not audited as this subsidiary is not material to the group.
(d)
Other independent auditors. Audited by firms of accountants other than member firms of RSM International of which RSM Chio Lim LLP in Singapore is a member. Their names are indicated above.
(e)
Not required to be audited under the law of its country of incorporation and it is not material.
(f)
Less than $1,000.
(g)
Applied for de-registration during the reporting year.
As is required by Rule 716 of the Listing Manual of The Singapore Exchange Securities Trading Limited, the audit committee and the board of directors of the company have satisfied themselves that the appointment of different auditors for certain of its overseas subsidiaries would not compromise the standard and effectiveness of the audit of the group.
17.
OTHER FINANCIAL ASSETS, NON-CURRENT Group and Company 2013 2012 $’000 $’000 As available-for-sale investments (Note 17A) Held-to-maturity investments (Note 17B)
5,083 2,030 7,113
4,627 2,030 6,657
Powermatic Data Systems Limited Annual Report 2013
Notes to the Financial Statements 31 March 2013
cont’d 17.
OTHER FINANCIAL ASSETS, NON-CURRENT (Cont’d)
17A.
Investments as Available-For-Sale at Fair Value Through Other Comprehensive Income Group and Company 2013 2012 $’000 $’000 Quoted equity shares in corporations Unquoted investment funds Unquoted equity shares in corporation Movements during the year: Fair value at beginning of the year Disposal of unquoted structured notes Purchase of unquoted investment funds Increase in fair value through other comprehensive income Fair value at end of the year
4,050 1,028 5 5,083
3,666 956 5 4,627
4,627 – – 456 5,083
5,415 (3,050) 1,000 1,262 4,627
The fair values of unquoted investment funds were based on the broker’s quote. 17B.
Held-to-Maturity Investments at Amortised Cost Group and Company 2013 2012 $’000 $’000 Unquoted bonds Unquoted structured notes
1,030 1,000 2,030
1,030 1,000 2,030
Movements during the year: At amortised cost at beginning of the year Additions at cost At amortised cost at end of the year
2,030 – 2,030
1,030 1,000 2,030
Fair value
2,103
2,015
65
66
Powermatic Data Systems Limited Annual Report 2013
Notes to the Financial Statements 31 March 2013
cont’d 18.
INVENTORIES Group
Finished goods and goods for resale Work-in-process Raw materials Inventories are stated after allowance as follows: Balance at beginning of the year Charge (reversed) to profit or loss included in cost of sales Used Balance at end of the year The write-down of inventories charged (reversed) to profit or loss included in cost of sales Changes in inventories of finished goods and work-in-process Raw materials and consumable used The amount of inventories included in cost of sales
2013 $’000
2012 $’000
241 117 851 1,209
941 181 220 1,342
382 46 (1) 427
423 (51) 10 382
47
(51)
(134) 8,584 8,497
(513) 13,980 13,416
There are no inventories pledged as security for liabilities.
19.
TRADE AND OTHER RECEIVABLES Group
Company 2013 2012 $’000 $’000
2013 $’000
2012 $’000
Trade receivables: Outside parties Less: Allowance for impairment Subtotal
1,775 (350) 1,425
2,161 (1,330) 831
– – –
59 – 59
Other receivables: Subsidiaries (Note 3) Less: Allowance for impairment Outside parties Subtotal Total trade and other receivables
– – 253 253 1,678
– – 170 170 1,001
5,708 (4,059) 39 1,688 1,688
6,130 (4,046) 14 2,098 2,157
1,330
1,359
4,046
4,046
8 (16) (972) 350
14 – (43) 1,330
13 – – 4,059
– – – 4,046
Movements in above allowances: Balance at beginning of the year Charged /(reversed) for trade receivables to profit or loss included in other charges Foreign currency adjustment Bad debts written-off Balance at end of the year
Powermatic Data Systems Limited Annual Report 2013
Notes to the Financial Statements 31 March 2013
cont’d 20.
OTHER FINANCIAL ASSETS, CURRENT Group and Company 2013 2012 $’000 $’000 Financial assets held for trading at fair value through profit or loss: − Quoted equity shares in corporations − Unquoted bonds and structured notes Movements during the year: Balance at beginning of the year Fair value gain/(loss) included in profit or loss under other credits/ (charges) Balance at end of the year
267 248 515
216 236 452
452 63
479 (27)
515
452
The group has not designated any financial assets upon initial recognition at fair value through profit or loss. The fair values of unquoted bonds and structured notes were based on the broker’s quote.
21.
OTHER ASSETS, CURRENT Group
Prepayments Deposits to secure services
22.
2013 $’000
2012 $’000
207 115 322
273 97 370
Company 2013 2012 $’000 $’000 12 110 122
32 91 123
CASH AND CASH EQUIVALENTS Group
Company 2013 2012 $’000 $’000
2013 $’000
2012 $’000
Fixed deposits Fixed deposits (maturity of over 3 months) Cash and bank balances
8,801 5,502 3,228 17,531
10,287 5,422 4,529 20,238
4,000 2,529 1,197 7,726
3,000 3,517 1,919 8,436
Interest earning balances
14,822
17,099
6,933
7,651
The rate of interest for the cash on interest earning balances is between 0.01% and 3.3% (2012: 0.018% and 3.3%) per year.
67
68
Powermatic Data Systems Limited Annual Report 2013
Notes to the Financial Statements 31 March 2013
cont’d 22.
CASH AND CASH EQUIVALENTS (Cont’d)
22A.
Cash and Cash Equivalents in the Consolidated Statement of Cash Flows
As shown above Less: Fixed deposits (maturity of over 3 months) Cash and cash equivalents for consolidated statement of cash flows purpose at end of the year
23.
2013 $’000
2012 $’000
17,531 (5,502)
20,238 (5,422)
12,029
14,816
SHARE CAPITAL
Group and Company
Balance at 1 April 2011, 31 March 2012 and 31 March 2013
Number of ordinary shares issued ‘000
Share Capital $’000
173,289
34,556
The ordinary shares, which have no par value, are fully paid and carry no right to fixed income. The holders of ordinary shares are entitled to receive dividends when declared by the company. All ordinary shares carry one vote per share without restrictions. In order to maintain its listing on the Singapore Securities Exchange Trading Limited, the company has to have share capital with a free float of at least 10% of the shares. The company met the capital requirement on its initial listing and the rules limiting treasury share purchases mean it will automatically continue to satisfy that requirement, as it did throughout the reporting year. Management receives a report from the registrars frequently on substantial share interests showing the non-free float to ensure continuing compliance with the 10% limit throughout the reporting year. Capital management: The objectives when managing capital are: to safeguard the reporting entity’s ability to continue as a going concern, so that it can continue to provide returns for owners and benefits for other stakeholders, and to provide an adequate return to owners by pricing the sales commensurately with the level of risk. The management sets the amount of capital to meet its requirements and the risk taken. There were no changes in the approach to capital management during the reporting year. The management manages the capital structure and makes adjustments to it where necessary or possible in the light of changes in conditions and the risk characteristics of the underlying assets. In order to maintain or adjust the capital structure, the management may adjust the amount of dividends paid to owners, return capital to owners, issue new shares, or sell assets to reduce debt. Adjusted capital comprises all components of equity (that is share capital and reserves). The group and company have insignificant external borrowings. The debt-to-adjusted capital ratio does not provide a meaningful indicator of risk of borrowings.
Powermatic Data Systems Limited Annual Report 2013
Notes to the Financial Statements 31 March 2013
cont’d 24.
SHARE-BASED PAYMENTS
24A.
Share Options – The Scheme The company has an employee share option scheme known as the “Powermatic Data Systems Employees’ Share Option Scheme 2003” (the “Scheme” which was adopted in 2003 and which had expired on 28 February 2003). The Scheme is a share incentive scheme designed to acknowledge the contributions made by the employees and to give recognition to such employees by giving them the opportunity to have a personal stake in the company and to motivate such employees in optimising their performance standards and efficiency and achieve strategic business objectives of the group and retention of key employees whose contributions are important to the long-term growth and profitability of the Group. Under the rules of the Scheme, all directors and full-time employees of the group are eligible to participate in the Scheme except for employee or director who is also a controlling shareholder or an associate of a controlling shareholder. The Scheme extends only to the employees of the company and its subsidiaries. Employees of the company’s associated companies are not eligible under the Scheme. The aggregate number of shares over which options may be granted shall not exceed 15% of the issued share capital of the company on the day immediately preceding the offer date of the option. The Scheme is administered by the Remuneration Committee comprising David Tan Chao Hsiung (Chairman) and two other independent directors of the company, Lye Kin Mun and Yee Lat Shing, Tom. The options granted on 12 December 2003 shall be exercisable from the 1st anniversary to the 5th anniversary of the offering date for non-executive directors and from the 1st anniversary to the 10th anniversary of the offering date for full time employees. On 28 January 2010, the company granted additional 3,180,000 share options, which shall be exercisable from the 1st half year to the 5th anniversary of the offering date. No options were granted to the directors or controlling shareholders. The offer price shall be equal to the average of the last dealt price for a share for the three consecutive trading days immediately preceding the offer date. The scheme expired on 28 February 2013. The options granted on 12 December 2003 and 28 June 2010 remain exercisable up to their respective exercisable date. The company will be seeking shareholders’ approval to adopt a new employee share option scheme at the EGM to be held on 25 July 2013.
24B.
Activities under the Share Options Scheme The outstanding number of options at the end of the reporting year was:
Offer date 12.12.2003 28.01.2010
Balance at 1.4.2012
Expired
Exercised
Balance at 31.3.2013
Offer price per share
Period exercisable
210,000 2,740,000 2,950,000
– (120,000) (120,000)
– – –
210,000 2,620,000 2,830,000
13 cents 13 cents
12.12.2004 – 11.12.2013 27.07.2010 – 27.01.2015
There were no unissued shares of subsidiaries under option as at 31 March 2013.
69
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Powermatic Data Systems Limited Annual Report 2013
Notes to the Financial Statements 31 March 2013
cont’d 25.
OTHER RESERVES Group
Available-for-sale (AFS) financial assets reserve (Note 25A) Share option reserve (Note 25B) Reserve on consolidation (Note 25C) Foreign currency translation reserve (Note 25D)
2013 $’000
2012 $’000
Company 2013 2012 $’000 $’000
3,566 107 88 (860)
3,110 107 88 (886)
3,566 107 – –
3,110 107 – –
2,901
2,419
3,673
3,217
All reserves classified on the face of the statement of financial position as retained earnings represents past accumulated earnings and are distributable as cash dividends. The other reserves are not available for cash dividends unless realised. 25A.
AFS Financial Assets Reserve Group and Company 2013 2012 $’000 $’000 Balance at beginning of the year Gains on re-measuring AFS financial assets Balance at end of the year
3,110 456 3,566
1,848 1,262 3,110
The AFS financial assets reserve comprises the cumulative fair value changes of available-for-sale financial assets until they are derecognised or impaired. 25B.
Share Option Reserve Group and Company 2013 2012 $’000 $’000 Balance at beginning and end of the year
25C.
107
107
Reserves on Consolidation Group
Balance at beginning and end of the year
2013 $’000
2012 $’000
88
88
Powermatic Data Systems Limited Annual Report 2013
Notes to the Financial Statements 31 March 2013
cont’d 25.
OTHER RESERVES (Cont’d)
25D.
Foreign Currency Translation Reserve Group 2013 $’000 Balance at beginning of the year Exchange differences on translating foreign operations Balance at end of the year
2012 $’000
(886) 26 (860)
(994) 108 (886)
The foreign currency translation reserve represents exchange differences arising from the translation of the financial statements of foreign operations whose functional currencies are different from the presentation currency of the group.
26.
OTHER LIABILITIES Group
Current: Deferred income Advance rental received Deposits received Provision for warranty costs Provision for capp fund Provision for reinstatement cost
2013 $’000
2012 $’000
– 14 839 78 109 467 1,507
1,000 – 1,206 93 130 500 2,929
Company 2013 2012 $’000 $’000 – 14 280 – – 467 761
1,000 – 553 – – 500 2,053
Movements in above provisions: Group 2013 $’000 Provision for warranty costs: Balance at beginning of the year Provision reversed to profit or loss included in the cost of sales Utilised during the year Balance at end of the reporting year
93 (3) (12) 78
2012 $’000 161 (49) (19) 93
71
72
Powermatic Data Systems Limited Annual Report 2013
Notes to the Financial Statements 31 March 2013
cont’d 26.
OTHER LIABILITIES (Cont’d) Movements in above provisions (cont’d)
Group 2013 $’000
Provision for capp fund: Balance at beginning of the year Provision reversed to profit or loss included in the cost of sales Utilised during the year Balance at the end of reporting year
130 (21) – 109
2012 $’000 179 (39) (10) 130
Group and Company 2013 2012 $’000 $’000 Provision for reinstatement cost: Balance at beginning of the year Reclassified from accrued liabilities Provision during the year included in property, plant and equipment Utilised during the year Balance at end of the reporting year
500 – – (33) 467
– 120 380 – 500
Deferred Income: On 10 March 2008, the company sold its leasehold property to an industrial REIT. Under the terms of the sale and purchase agreement, the company has leased back the property for five years from 10 March 2008 to 9 March 2013. The selling price of the property of $25 million was determined to be $5 million above its fair value of $20 million at the date of sale. The difference between the selling price and fair value of $5 million is deferred and amortised over the leaseback period of five years. The fair value calculation was arrived based on management judgement.
27.
TRADE AND OTHER PAYABLES Group
Company 2013 2012 $’000 $’000
2013 $’000
2012 $’000
Trade payables: Outside parties and accrued liabilities
1,499
1,811
168
182
Other payables: Outside parties Total trade and other payables
174 1,673
46 1,857
– 168
1 183
Powermatic Data Systems Limited Annual Report 2013
Notes to the Financial Statements 31 March 2013
cont’d 28.
FINANCIAL INSTRUMENTS: INFORMATION ON FINANCIAL RISKS
28A.
Classification of Financial Assets and Liabilities The following table summarises the carrying amount of financial assets and liabilities recorded at the end of the reporting year by FRS 39 categories: Group
Financial assets Cash and cash equivalents Loans and receivables Financial assets at fair value through profit or loss Available-for-sale financial assets Held-to-maturity financial assets
Financial liabilities Trade and other payables at amortised cost
Company 2013 2012 $’000 $’000
2013 $’000
2012 $’000
17,531 1,678 515
20,238 1,001 452
7,726 1,689 515
8,436 2,157 452
5,083 2,030 26,837
4,627 2,030 28,348
5,083 2,030 17,043
4,627 2,030 17,702
1,673
1,857
168
183
Further quantitative disclosures are included throughout these financial statements. 28B.
Financial Risk Management The main purpose for holding or issuing financial instruments is to raise and manage the finances for the entity’s operating, investing and financing activities. There are exposures to the financial risks on the financial instruments such as credit risk, liquidity risk and market risk comprising interest rate, currency risk and price risk exposures. The management has certain practices for the management of financial risks and action to be taken in order to manage the financial risks. The guidelines include the following: (i) (ii)
(iii) (iv)
Minimise interest rate, currency, credit and market risks for all kinds of transactions. Maximise the use of “natural hedge”: favouring as much as possible the natural off-setting of sales and costs and payables and receivables denominated in the same currency and therefore put in place hedging strategies only for the excess balance. The same strategy is pursued with regard to interest rate risk. All financial risk management activities are carried out and monitored by senior management staff. All financial risk management activities are carried out following market practices.
There have been no changes to the exposure to risk, the objectives, policies and processes for managing the risk and the methods used to measure the risk.
73
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Powermatic Data Systems Limited Annual Report 2013
Notes to the Financial Statements 31 March 2013
cont’d 28C.
Fair Value of Financial Instruments
28C1. Fair value of financial instruments stated at amortised cost in the statement of financial position The financial assets and financial liabilities at amortised cost are at carrying amounts that are reasonable approximation of fair values. 28C2. Fair value measurements recognised in the statement of financial position The fair value measurements are classified using a fair value hierarchy that reflects the significance of the inputs used in making the measurements. The levels are: Level 1: quoted prices (unadjusted) in active markets for identical assets or liabilities; Level 2: inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices); and Level 3: inputs for the asset or liability that are not based on observable market data (unobservable inputs). The quantitative disclosures for the fair value measurements using a fair value hierarchy that reflects the significance of the inputs used in making the measurements are disclosed below:
At 31 March 2013: Financial assets at fair value through profit or loss: Quoted equity shares in corporations Unquoted bonds and structured notes
Level 1 $’000
Group and Company Level 2 Level 3 $’000 $’000
Total $’000
267 –
– 248
– –
267 248
Available-for-sale financial assets: Quoted equity shares in corporations Unquoted equity shares in corporation Unquoted investment funds
4,050 – –
– – 1,028
– 5 –
4,050 5 1,028
Held-to-maturity financial assets: Unquoted bonds Unquoted structured notes Total
– – 4,317
1,030 1,000 3,306
– – 5
1,030 1,000 7,628
Powermatic Data Systems Limited Annual Report 2013
Notes to the Financial Statements 31 March 2013
cont’d 28.
FINANCIAL INSTRUMENTS: INFORMATION ON FINANCIAL RISKS (Cont’d)
28C2. Fair value measurements recognised in the statement of financial position (Cont’d)
At 31 March 2012: Financial assets at fair value through profit or loss: Quoted equity shares in corporations Unquoted bonds and structured notes
Level 1 $’000
Group and Company Level 2 Level 3 $’000 $’000
Total $’000
216 –
– 236
– –
216 236
Available-for-sale financial assets: Quoted equity shares in corporations Unquoted equity shares in corporation Unquoted investment funds
3,666 – –
– – 956
– 5 –
3,666 5 956
Held-to-maturity financial assets: Unquoted bonds Unquoted structured notes Total
– – 3,882
1,030 1,000 3,222
– – 5
1,030 1,000 7,109
There were no significant transfers between Level 1 and Level 2 of the fair value hierarchy. Reconciliation for fair value measurements and analysis of effect of changing inputs on fair value measurements in Level 3 of the fair value hierarchy are not disclosed as the carrying amount of the related financial assets is not material. 28D.
Credit Risk on Financial Assets Financial assets that are potentially subject to concentrations of credit risk and failures by counterparties to discharge their obligations in full or in a timely manner consist principally of cash balances with banks, cash equivalents and receivables, and other financial assets. The maximum exposure to credit risk is the total of the fair value of the financial instruments at the end of the reporting year. Credit risk on cash balances with banks is limited because the counter-parties are entities with acceptable credit ratings. Credit risk on other financial assets is limited because the other parties are entities with acceptable credit ratings. For credit risk on receivables an ongoing credit evaluation is performed on the financial condition of the debtors and a loss from impairment is recognised in profit or loss. The exposure to credit risk is controlled by setting limits on the exposure to individual customers and these are disseminated to the relevant persons concerned and compliance is monitored by management. There is no significant concentration of credit risk, as the exposure is spread over a large number of counter-parties and customers. Cash and cash equivalents as disclosed in Note 22 represent amount with less than 90 days maturity.
75
76
Powermatic Data Systems Limited Annual Report 2013
Notes to the Financial Statements 31 March 2013
cont’d 28.
FINANCIAL INSTRUMENTS: INFORMATION ON FINANCIAL RISKS (Cont’d)
28D.
Credit Risk on Financial Assets (Cont’d) As part of the process of setting customer credit limits, different credit terms are used. The average credit period generally granted to trade receivable customers range from 30-90 days (2012: 30-90 days). But some customers take a longer period to settle the amounts. (a)
Ageing analysis of the age of trade receivable amounts that are past due as at the end of reporting year but not impaired: Group
Trade receivables: Over 180 days (b)
2013 $’000
2012 $’000
–
1
Ageing analysis as at the end of reporting year of trade receivable amounts that are impaired: Group
Trade receivables: Over 90 days
2013 $’000
2012 $’000
350
1,330
The allowance which is disclosed in the note on trade receivables is based on individual accounts totalling $350,000 (2012: $1,330,000) that are determined to be impaired at the end of the reporting year. These are not secured. Other receivables are normally with no fixed terms and therefore there is no maturity. Available-for-sale instruments represent equity shares and investment funds and therefore there is no fixed maturity. 28E.
Liquidity Risk The following table analyses financial liabilities by remaining contractual maturity (contractual and undiscounted cash flows at the end of the reporting year): Less than 1 year Group
Trade and other payables
2013 $’000
2012 $’000
1,673
1,857
Company 2013 2012 $’000 $’000 168
183
Powermatic Data Systems Limited Annual Report 2013
Notes to the Financial Statements 31 March 2013
cont’d 28.
FINANCIAL INSTRUMENTS: INFORMATION ON FINANCIAL RISKS (Cont’d)
28E.
Liquidity Risk (Cont’d) The above amounts disclosed in the maturity analysis are the contractual and undiscounted cash flows and such undiscounted cash flows differ from the amount included in the statement of financial position. When the counterparty has a choice of when an amount is paid, the liability is included on the basis of the earliest date on which it can be required to pay. For financial guarantee contracts, the maximum earliest period in which the guarantee could be called is used. At the end of the reporting year, no claims on the financial guarantees are expected. The following table shows the maturity analysis of the contingent liabilities:
Group and Company 2013 Performance guarantee in respect of: − Foreign employment contracts − Utility deposits − Leaseback arrangement
Group and Company 2012 Performance guarantee in respect of: − Foreign employment contracts − Utility deposits − Leaseback arrangement
Less than 1 year $’000
1−3 years $’000
Total $’000
– – 1,000 1,000
5 126 – 131
5 126 1,000 1,131
1−3 years $’000
Total $’000
5 126 1,820 1,951
5 126 1,820 1,951
Less than 1 year $’000
– – – –
The liquidity risk refers to the difficulty in meeting obligations associated with financial liabilities that are settled by delivering cash or another financial asset. It is expected that all the liabilities will be paid at their contractual maturity. The average credit period taken to settle trade payables is about 90 days (2012: 90 days). The other payables are with short-term durations. In order to meet such cash commitments, the operating activities are expected to generate sufficient cash inflows. 28F.
Interest Rate Risk The group is not exposed to significant interest rate risk. The interest from financial assets including cash balances is not significant and the group has insignificant external borrowings.
77
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Powermatic Data Systems Limited Annual Report 2013
Notes to the Financial Statements 31 March 2013
cont’d 28.
FINANCIAL INSTRUMENTS: INFORMATION ON FINANCIAL RISKS (Cont’d)
28G.
Foreign Currency Risk Analysis of amounts of financial assets and liabilities denominated in non-functional currency at the end of the reporting year: Group: Financial assets: Cash and cash equivalents Trade and other receivables Financial liabilities: Trade and other payables Net financial assets
United States Dollars 2013 2012 $’000 $’000 248 1,074 1,322
1,200 699 1,899
(229) 1,093
(447) 1,452
The company’s financial assets and financial liabilities denominated in non-functional currency are not material. There is exposure to foreign currency risk as part of the normal business of the group. Sensitivity analysis:
Group 2013 $’000
A hypothetical 10% strengthening in the exchange rate of the functional currency $ against the USD would have an adverse effect on profit before income tax of
(109)
2012 $’000
(145)
The above table shows sensitivity to a hypothetical 10% variation in the functional currency against the United States Dollars (USD). The sensitivity rate used is the reasonably possible change in foreign exchange rates. For similar rate weakening of the functional currency against the USD, there would be comparable impacts in the opposite direction on the profit or loss. The hypothetical changes in exchange rates are not based on observable market data (unobservable inputs). The sensitivity analysis is disclosed for each currency to which the entity has significant exposure. The analysis above has been carried out on the basis that there are no hedged transactions. In management’s opinion, the above sensitivity analysis is unrepresentative of the foreign currency risks as the historical exposure does not reflect the exposure in future.
Powermatic Data Systems Limited Annual Report 2013
Notes to the Financial Statements 31 March 2013
cont’d 28.
FINANCIAL INSTRUMENTS: INFORMATION ON FINANCIAL RISKS (Cont’d)
28H. Equity Price Risk There are investments in quoted equity shares or similar instruments. As at the end of the reporting year, some equity shares were held in companies listed on the Singapore Exchange and other stock exchanges (see Notes 17 and 20). As a result, such investments are exposed to both currency risk and changes in fair value risk. Sensitivity analysis: The fair values of those assets as at the end of the reporting year are disclosed in Notes 17 and 20. A hypothetical 10% decrease in the fair value of those assets would result in a fair value loss of $432,000 (2012: $388,000).
29.
OPERATING LEASE PAYMENT COMMITMENTS At the end of the reporting year, total of future minimum lease payment commitments under noncancellable operating leases are as follows: Group
Company 2013 2012 $’000 $’000
2013 $’000
2012 $’000
Not later than one year Later than one year and not later than five years
496 1,065
1,883 –
360 829
1,798 –
Rental expense for the year
1,959
2,034
1,820
1,911
Operating lease payments are for rentals payable for certain factory properties, including the company’s office in Singapore at PM Industrial Building, which is leased from an industrial REIT for three years from 10 March 2013 to 9 March 2016. The lease rental terms are negotiated for three years at agreed rent rates for each of the respective year. Prior to 10 March 2013, the Company leased back the PM Industrial building from the same industrial REIT for use as office premise and warehouse facilities. The excess spaces were sub-let to other tenants. The sub-lease rental income for the reporting year was $ 1,571,000 (2012: $1,528,000).
79
80
Powermatic Data Systems Limited Annual Report 2013
Notes to the Financial Statements 31 March 2013
cont’d 30.
OPERATING LEASE INCOME COMMITMENTS At the end of the reporting year, total of future minimum lease receivables committed under noncancellable operating leases are as follows: Group and Company 2013 2012 $’000 $’000 Not later than one year Later than one year and not later than five years
1,164 781
1,101 1,067
Rental income for the year
2,790
2,796
The lease rental income terms are negotiated for an average term of two years at an agreed rental.
31.
CONTINGENT LIABILITIES There were no contingent liabilities as at 31 March 2013. (2012 : $80,000)
32.
CHANGES AND ADOPTION OF FINANCIAL REPORTING STANDARDS For the current reporting year the following new or revised Singapore Financial Reporting Standards were adopted. The new or revised standards did not require material modification of the measurement methods or the presentation in the financial statements. FRS No.
Title
FRS 1
Amendments to FRS 1 – Presentation of Items of Other Comprehensive Income
FRS 12
Deferred Tax (Amendments to ) – Recovery of Underlying Assets
FRS 107
Financial Instruments: Disclosures (Amendments to) − Transfers of Financial Assets (*) (*) Not relevant to the entity.
Powermatic Data Systems Limited Annual Report 2013
Notes to the Financial Statements 31 March 2013
cont’d 33.
FUTURE CHANGES IN FINANCIAL REPORTING STANDARDS The following new or revised Singapore Financial Reporting Standards that have been issued will be effective in future. The transfer to the new or revised standards from the effective dates is not expected to result in material adjustments to the financial position, results of operations, or cash flows for the following year. Effective date for periods beginning on or after
FRS No.
Title
FRS 1
Amendment to FRS 1 Presentation of Financial Statements (Annual Improvements)
1 Jan 2013
FRS 16
Amendment to FRS 16 Property, Plant and Equipment (Annual Improvements)
1 Jan 2013
FRS 19
Employee Benefits (Revised)
1 Jan 2013
FRS 27
Consolidated and (Amendments to)
FRS 27
Separate Financial Statements (Revised)
1 Jan 2014
FRS 28
Investments in Associates and Joint Ventures (Revised) (*)
1 Jan 2014
FRS 32
Amendment to FRS 32 Financial instruments: Presentation (Annual Improvements)
1 Jan 2013
FRS 107
Amendments to FRS 32 and 107 titled Offsetting Financial Assets and Financial Liabilities (*)
1 Jan 2013
FRS 110
Consolidated Financial Statements
1 Jan 2014
FRS 111
Joint Arrangements (*)
1 Jan 2014
FRS 112
Disclosure of Interests in Other Entities
1 Jan 2014
FRS 110
Amendments to FRS 110, FRS 111 and FRS 112
1 Jan 2014
FRS 113
Fair Value Measurements
1 Jan 2013
INT FRS 120
Stripping Costs in the Production Phase of a Surface Mine (*)
1 Jan 2013
Separate
(*) Not relevant to the entity.
Financial
Statements
1 Jul 2012
81
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Powermatic Data Systems Limited Annual Report 2013
STATISTICS OF SHAREHOLDINGS AS AT 13 JUNE 2013 DISTRIBUTION OF SHAREHOLDINGS Issued and fully paid-up capital Number of ordinary shares in issue Class of Shares Voting Rights
SIZE OF SHAREHOLDINGS 1 − 999 1,000 − 10,000 10,001 − 1,000,000 1,000,001 AND ABOVE TOTAL
S$34,556,050 173,289,000 Ordinary Shares One vote per share NO. OF SHAREHOLDERS 164 2,219 597 12 2,992
%
NO. OF SHARES
5.48 74.17 19.95 0.40 100.00
76,730 10,673,200 23,875,008 138,664,062 173,289,000
% 0.04 6.16 13.78 80.02 100.00
TWENTY LARGEST SHAREHOLDERS NO.
NAME
NO. OF SHARES
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20
CHEN MUN ANG BEE YAN UNITED OVERSEAS BANK NOMINEES (PRIVATE) LIMITED LEONG HONG KAH DBS NOMINEES PTE LTD ONG ERIC OCBC NOMINEES SINGAPORE PTE LTD HO SOON TECK OVERSEA-CHINESE BANK NOMINEES PTE LTD LIM POH KENG ANG HAO YAO (HONG HAOYAO) SIEW CHEE MENG LUO FENG SOPHIA ANG BEE LENG HUANG PING K’NAR TAN KAH KIM LEE CHIANG HUAT LOI POH MUN LEE SEK LEONG CHRISTOPHER OCBC SECURITIES PRIVATE LIMITED TOTAL
97,139,662 13,874,000 5,792,600 4,950,000 4,054,200 3,521,000 2,254,000 1,646,000 1,398,600 1,365,000 1,339,000 1,330,000 570,000 418,000 411,000 409,000 400,000 361,000 330,000 320,039 141,883,101
% 56.06 8.01 3.34 2.86 2.34 2.03 1.30 0.95 0.81 0.79 0.77 0.77 0.33 0.24 0.24 0.24 0.23 0.21 0.19 0.18 81.89
Substantial Shareholders (as recorded in the Register of Substantial Shareholders) Name of Shareholder Dr Chen Mun Ang Bee Yan
Direct Interest 97,139,662 13,874,000
% 56.06 8.01
Deemed Interest 0 0
% 0 0
Percentage of Shareholdings in Public Hands 35.93% of the Company’s shares are in the hands of the public. Accordingly, the Company has complied with Rule 723 of the listing manual of the SGX-ST.
Powermatic Data Systems Limited Annual Report 2013
NOTICE OF TWENTY-FOURTH ANNUAL GENERAL MEETING NOTICE IS HEREBY GIVEN that the Twenty-Fourth Annual General Meeting of Powermatic Data Systems Limited (the “Company”) will be held at 135 Joo Seng Road, #08-01, Singapore 368363 at 11.00 a.m. on Thursday, 25 July 2013 for the following purposes: AS ORDINARY BUSINESS 1.
To receive and adopt the Directors’ Report and the Audited Financial Statements of the Company for the year ended 31 March 2013 together with the Auditors’ Report thereon. (Resolution 1) 2. To declare a first and final one-tier tax exempt dividend of Singapore 1 cent per ordinary share for the financial year ended 31 March 2013. (2012: First and Final one-tier tax exempt dividend of Singapore 1 cent per ordinary share). (Resolution 2) 3.
To re-elect Mr David Tan Chao Hsiung, a Director of the Company retiring pursuant to Article 99 of the Articles of Association of the Company. (Resolution 3)
Mr David Tan will, upon re-election as a Director of the Company, remain as Chairman of the Remuneration Committee and a member of the Audit and Nominating Committees and will be considered independent.
4.
To re-appoint Mr Yee Lat Shing, Tom, who is retiring under Section 153(6) of the Companies Act, Cap. 50, to hold office from the date of this Annual General Meeting until the next Annual General Meeting of the Company. (Resolution 4)
Mr Yee will, upon re-appointment as a Director of the Company, remain as Chairman of the Audit Committee and a member of the Nominating and Remuneration Committees and will be considered independent.
5.
To approve the payment of Directors’ fees of S$42,000 for the year ended 31 March 2013. (2012: S$42,000). (Resolution 5)
6.
To re-appoint Messrs RSM Chio Lim LLP as the Auditors of the Company and to authorise the Directors of the Company to fix their remuneration. (Resolution 6) 7. To transact any other ordinary business which may properly be transacted at an Annual General Meeting. AS SPECIAL BUSINESS To consider and if thought fit, to pass the following resolutions as Ordinary Resolutions, with or without any modifications: 8. Authority to issue shares
That pursuant to Section 161 of the Companies Act, Cap. 50 and Rule 806 of the Listing Manual of the Singapore Exchange Securities Trading Limited, the Directors of the Company be authorised and empowered to: (a)
(i)
issue shares in the Company (“shares”) whether by way of rights, bonus or otherwise; and/or
83
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Powermatic Data Systems Limited Annual Report 2013
NOTICE OF TWENTY-FOURTH ANNUAL GENERAL MEETING cont’d (ii)
make or grant offers, agreements or options (collectively, “Instruments”) that might or would require shares to be issued, including but not limited to the creation and issue of (as well as adjustments to) options, warrants, debentures or other instruments convertible into shares, at any time and upon such terms and conditions and for such purposes and to such persons as the Directors of the Company may in their absolute discretion deem fit; and
(b)
(notwithstanding the authority conferred by this Resolution may have ceased to be in force) issue shares in pursuance of any Instruments made or granted by the Directors of the Company while this Resolution was in force,
provided that: (1)
the aggregate number of shares (including shares to be issued in pursuance of the Instruments, made or granted pursuant to this Resolution) to be issued pursuant to this Resolution shall not exceed fifty per centum (50%) of the total number of issued shares in the capital of the Company (as calculated in accordance with sub-paragraph (2) below), of which the aggregate number of shares to be issued other than on a pro rata basis to shareholders of the Company shall not exceed twenty per centum (20%) of the total number of issued shares in the capital of the Company (as calculated in accordance with sub-paragraph (2) below);
(2)
(subject to such calculation as may be prescribed by the Singapore Exchange Securities Trading Limited) for the purpose of determining the aggregate number of shares that may be issued under sub-paragraph (1) above, the total number of issued shares shall be based on the total number of issued shares in the capital of the Company at the time of the passing of this Resolution, after adjusting for: (a)
new shares arising from the conversion or exercise of any convertible securities;
(b)
new shares arising from exercising share options or vesting of share awards which are outstanding or subsisting at the time of the passing of this Resolution; and
(c)
any subsequent bonus issue, consolidation or subdivision of shares;
(3)
in exercising the authority conferred by this Resolution, the Company shall comply with the provisions of the Listing Manual of the Singapore Exchange Securities Trading Limited for the time being in force (unless such compliance has been waived by the Singapore Exchange Securities Trading Limited) and the Articles of Association of the Company; and
(4)
unless revoked or varied by the Company in a general meeting, such authority shall continue in force until the conclusion of the next Annual General Meeting of the Company or the date by which the next Annual General Meeting of the Company is required by law to be held, whichever is earlier. [See Explanatory Note (i)] (Resolution 7)
By Order of the Board
Lee Ellen Secretary Singapore, 10 July 2013
Powermatic Data Systems Limited Annual Report 2013
NOTICE OF TWENTY-FOURTH ANNUAL GENERAL MEETING cont’d Explanatory Notes: (i)
The Ordinary Resolution 7 in item 8 above, if passed, will empower the Directors of the Company, effective until the conclusion of the next Annual General Meeting of the Company, or the date by which the next Annual General Meeting of the Company is required by law to be held or such authority is varied or revoked by the Company in a general meeting, whichever is the earlier, to issue shares, make or grant Instruments convertible into shares and to issue shares pursuant to such Instruments, up to a number not exceeding, in total, 50% of the total number of issued shares in the capital of the Company, of which up to 20% may be issued other than on a pro-rata basis to shareholders.
(ii)
For determining the aggregate number of shares that may be issued, the total number of issued shares will be calculated based on the total number of issued shares in the capital of the Company at the time this Ordinary Resolution is passed after adjusting for new shares arising from the conversion or exercise of any convertible securities or share options or vesting of share awards which are outstanding or subsisting at the time when this Ordinary Resolution is passed and any subsequent bonus issue, consolidation or subdivision of shares.
Notes: 1.
A Member entitled to attend and vote at the Annual General Meeting (the “Meeting”) is entitled to appoint not more than two proxies to attend and vote in his/her/its stead. A proxy need not be a Member of the Company.
2.
The instrument appointing a proxy must be deposited at the Registered Office of the Company at 135 Joo Seng Road, #08-01, Singapore 368363, not less than forty-eight (48) hours before the time appointed for holding the Meeting.
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IMPORTANT:
POWERMATIC DATA SYSTEMS LIMITED Company Registration No. 198900414E (Incorporated In The Republic of Singapore)
1.
For investors who have used their CPF monies to buy POWERMATIC DATA SYSTEMS LIMITED’s shares, this Report is forwarded to them at the request of the CPF Approved Nominees and is sent solely FOR INFORMATION ONLY.
2.
This Proxy Form is not valid for use by CPF investors and shall be ineffective for all intents and purposes if used or purported to be used by them.
3.
CPF investors who wish to attend the Meeting as an observer must submit their requests through their CPF Approved Nominees within the time frame specified. If they also wish to vote, they must submit their voting instructions to the CPF Approved Nominees within the time frame specified to enable them to vote on their behalf.
PROXY FORM (Please see notes overleaf before completing this Form)
I/We, ......................................................................................................................................................................................... of ............................................................................................................................................................................................... being a member/members of Powermatic Data Systems Limited (the “Company”), hereby appoint: Name
NRIC/Passport No.
Proportion of Shareholdings No. of Shares
%
Address and/or (delete as appropriate) Name
NRIC/Passport No.
Proportion of Shareholdings No. of Shares
%
Address or failing the person, or either or both of the persons, referred to above , the Chairman of the Meeting as my/our proxy/ proxies to vote for me/us on my/our behalf at the Twenty-Fourth Annual General Meeting (the “Meeting”) of the Company to be held on 25 July 2013 at 11.00 a.m. and at any adjournment thereof. I/We direct my/our proxy/proxies to vote for or against the Resolutions proposed at the Meeting as indicated hereunder. If no specific direction as to voting is given or in the event of any other matter arising at the Meeting and at any adjournment thereof, the proxy/proxies will vote or abstain from voting at his/her discretion. The authority herein includes the right to demand or to join in demanding a poll and to vote on a poll. (Please indicate your vote “For” or “Against” with a tick [✓] within the box provided.) No.
Resolutions relating to:
For
1
Directors’ Report and Audited Financial Statements for the year ended 31 March 2013
2
Payment of proposed first & final one-tier tax exempt dividend
3
Re-election of Mr David Tan Chao Hsiung as a Director
4
Re-appointment of Mr Yee Lat Shing, Tom as a Director
5
Approval of Directors’ fees amounting to S$42,000
6
Re-appointment of Messrs RSM Chio Lim LLP as Auditors
7
Authority to issue shares
Against
Dated this .................................. day of .................................. 2013 Total number of Shares in: (a) CDP Register
........................................................................................ Signature of Shareholder(s) or, Common Seal of Corporate Shareholder *Delete where inapplicable
(b) Register of Members
No. of Shares
Notes : 1.
Please insert the total number of Shares held by you. If you have Shares entered against your name in the Depository Register (as defined in Section 130A of the Companies Act, Chapter 50 of Singapore), you should insert that number of Shares. If you have Shares registered in your name in the Register of Members, you should insert that number of Shares. If you have Shares entered against your name in the Depository Register and Shares registered in your name in the Register of Members, you should insert the aggregate number of Shares entered against your name in the Depository Register and registered in your name in the Register of Members. If no number is inserted, the instrument appointing a proxy or proxies shall be deemed to relate to all the Shares held by you.
2.
A member of the Company entitled to attend and vote at a meeting of the Company is entitled to appoint one or two proxies to attend and vote in his/her stead. A proxy need not be a member of the Company.
3.
Where a member appoints two proxies, the appointments shall be invalid unless he/she specifies the proportion of his/her shareholding (expressed as a percentage of the whole) to be represented by each proxy.
4.
Completion and return of this instrument appointing a proxy shall not preclude a member from attending and voting at the Meeting. Any appointment of a proxy or proxies shall be deemed to be revoked if a member attends the meeting in person, and in such event, the Company reserves the right to refuse to admit any person or persons appointed under the instrument of proxy to the Meeting.
5.
The instrument appointing a proxy or proxies must be deposited at the registered office of the Company at 135 Joo Seng Road, #08-01, Singapore 368363 not less than 48 hours before the time appointed for the Meeting.
6.
The instrument appointing a proxy or proxies must be under the hand of the appointor or of his attorney duly authorised in writing. Where the instrument appointing a proxy or proxies is executed by a corporation, it must be executed either under its seal or under the hand of its attorney duly authorised. Where the instrument appointing a proxy or proxies is executed by an attorney on behalf of the appointor, the letter or power of attorney or a duly certified copy thereof must be lodged with the instrument.
7.
A corporation which is a member may authorise by resolution of its directors or other governing body such person as it thinks fit to act as its representative at the Meeting, in accordance with Section 179 of the Companies Act, Chapter 50 of Singapore.
General: The Company shall be entitled to reject the instrument appointing a proxy or proxies if it is incomplete, improperly completed or illegible, or where the true intentions of the appointor are not ascertainable from the instructions of the appointor specified in the instrument appointing a proxy or proxies. In addition, in the case of Shares entered in the Depository Register, the Company may reject any instrument appointing a proxy or proxies lodged if the member, being the appointor, is not shown to have Shares entered against his name in the Depository Register as at 48 hours before the time appointed for holding the Meeting, as certified by The Central Depository (Pte) Limited to the Company.
ANNUAL REPORT 2013
ANNUAL REPORT
135 Joo Seng Road, #08-01 Singapore 368363 Tel: +65 6288 8220 Fax: +65 6280 9947 Co. Reg.No.: 198900414E
www.powermatic.com.sg
Powermatic Data Systems Limited
Powermatic Data Systems Limited
Powermatic Data Systems Limited
