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ASDION BERHAD

Solutions for Growing Businesses

ASDION BERHAD
(Company No.: 590812-D)

annual report
2015

ASDION BERHAD (590812-D)


ANNUAL REPORT 2015

Oval Tower @ Damansara


Unit 28-8, 28th Floor, No. 685 Jalan Damansara
TTDI, 60000 Kuala Lumpur, Malaysia

T: +603 6272 7878 F: +603 6272 7373

www.asdion.com
Asdion Berhad
(590812-D)

ANNUAL REPORT 2015

Contents

Notice of Annual General Meeting ... 2


Companys Profile ... 4
Group Corporate Structure ... 5
Corporate Information ... 6
Profile of the Board of Directors ... 7
Audit Committee Report ... 12
Statement of Corporate Governance ... 17
Statement on Risk Management and Internal Control ... 25
Additional Compliance Information ... 28
Chairmans Statement ... 33
Financial Statements ... 37
List of Properties ... 129
Analysis of Shareholdings ... 131
Form of Proxy ... Enclosed

1
Notice of Annual General Meeting

NOTICE IS HEREBY GIVEN that the Thirteenth Annual General Meeting of the Company will be held
at Sri Damansara Club Berhad, Lot 23304, Persiaran Perdana, Bandar Sri Damansara, 52200 Kuala
Lumpur on Monday, 28 September 2015 at 10.00 a.m. for the following purposes:

AGENDA

As Ordinary Business

1. To receive the Audited Financial Statements of the Company for the financial Please refer to
year ended 31 March 2015 together with the Reports of the Directors and explanatory
Auditors thereon. note A
2. To re-elect the following Director who retire in accordance with Article 81 of
the Companys Articles of Association and, being eligible, offer himself for
re-election:

(a) Mr. See Poh Yee Resolution 1


3. To re-elect the following Directors who retire in accordance with Article 88 of
the Companys Articles of Association and, being eligible, offer themselves
for re-election:

(a) Mr. Selva Rasan A/L Dato Puspa Das Resolution 2


(b) Encik Mohamad Farid Bin Mohd Yusof Resolution 3
(c) Datuk Raime Bin Unggi Resolution 4
(d) Dato Yen Soon Ai Resolution 5
(e) Tengku Azlan Ibni Sultan Abu Bakar Resolution 6
(f) Dato Mohamed Ridzuan Bin Nor Md Resolution 7
4. To approve the payment of Directors Fees for the financial year ended 31 Resolution 8
March 2015.

5. To re-appoint Messrs. SJ Grant Thornton as the Auditors of the Company Resolution 9


and to authorise the Board of Directors to fix their remuneration.


AS SPECIAL BUSINESS

6. To consider and, if thought fit, to pass the following Ordinary Resolution with Resolution 10
or without modifications:-

ORDINARY RESOLUTION
- AUTHORITY TO ISSUE AND ALLOT SHARES PURSUANT TO
SECTION 132D OF THE COMPANIES ACT, 1965

THAT pursuant to Section 132D of the Companies Act, 1965 and


subject to the approval of the relevant governmental and/or regulatory
authorities, authority be and is hereby given to the Directors to issue
shares in the Company, at any time and upon such terms and conditions
for such purposes as the Directors may, in their absolute discretion,
deem fit, provided that the aggregate number of shares issued pursuant
to this resolution in any one financial year does not exceed 10% of the
issued capital of the Company for the time being and that the Directors
be and are also empowered to obtain the approval for the listing of
and quotation for the additional shares so issued on Bursa Malaysia
Securities Berhad and that such authority shall continue to be in force
until the conclusion of the next Annual General Meeting of the Company.



2
Asdion Berhad
(590812-D)

ANNUAL REPORT 2015

Notice of Annual General Meeting (Contd)

7. To transact any other ordinary business of the company for which due notice
shall have been given.

By Order of the Board

Lee Wai Ngan (LS00184)


Chan Toye Ying (LS00185)
Company Secretaries

Kuala Lumpur
26 August 2015

Notes:

1. In respect of deposited securities, only members whose name appear in the Record of Depositors
as at 21 September 2015 (General Meeting Record of Depositors) shall be regarded as a member
entitled to attend, speak and vote or to appoint a proxy or proxies to attend, speak and vote at the
Thirteenth Annual General Meeting.
2. A member of the Company entitled to attend and vote at the meeting is entitled to appoint a proxy
to attend and vote in his stead. A member may appoint more than one proxy to attend at the same
meeting. Where a member appoints more than one proxy, the appointment shall be invalid unless
he specifies the proportion of his shareholding to be represented by each proxy.
3. A proxy may but need not be a member of the Company and the provisions of Section 149(1)(b)
of the Companies Act, 1965 shall not apply to the Company.
4. The instrument appointing a proxy shall be in writing under the hand of the appointor or of his
attorney duly authorised in writing, or if the appointor is a corporation, either under its common
seal or under the hand of an officer or attorney duly authorised.
5. The instrument appointing a proxy must be deposited at the Companys Registered Office situated
at Plaza 138, Suite 18.03, 18th Floor, 138 Jalan Ampang, 50450 Kuala Lumpur not less than forty-
eight (48) hours before the time for holding the meeting or at any adjournment thereof.

Explanatory Note A
This Agenda item is meant for discussion only as the provisions of Section 169(1) of the Companies
Act, 1965 does not require a formal approval of the shareholders for the audited financial statements.
As such, this item is not put forward for voting.

Explanatory Note on Special Business :



The Ordinary Resolution 10 proposed in Agenda 6, if passed, will empower the Directors to issue shares
up to 10% of the issued and paid-up share capital of the Company from time to time for such purposes
as the Directors consider would be in the best interest of the Company. This authorisation will expire at
the
conclusion of the next Annual General Meeting of the Company.
The mandate sought is a renewal of the mandate given by the shareholders of the Company at the Twelfth
Annual General Meeting held on 25 September 2014. As at the date of this Notice, no new shares in the
Company were issued pursuant to the authority granted to the Directors and accordingly, no proceeds
were raised therefrom.
The purpose for the renewal of the general mandate is to avoid any delay and additional costs in convening
a general meeting to approve such issue of shares in the event of any possible fund raising activities for
the purpose of funding future projects, additional working capital, etc. which may require the allotment
and issuance of new shares.

3
Companys Profile

HISTORY AND PRINCIPAL ACTIVITIES

ASDION is an acronym for Application Solution Developed In Objects and Network.

Asdion Berhad (Asdion) was incorporated in Malaysia as a private limited company on 27 August 2002
under the Companies Act 1965 with the name of Asdion Sdn Bhd. On 16 December 2003, Asdion
converted into a public limited company and adopted its present name. The principal activities of
Asdion are investment holding and engaging in software development and Information Communication
Technology and related activities.

The Asdion Group specialises in providing advanced integrated operations software solutions and
products with particular focus on a broad service sectors from hospitality, membership, supply chain
logistics to media related businesses.

Asdion seeks to position itself as a performance leader in the Asia Pacific market in the development,
marketing and distribution of advanced integrated business solutions. Its vision is to develop superior
and reliable software products to meet challenging demands in the market place.

VISION

ASDION is committed to be the performance leader in the global market in the development, marketing
and distribution of advanced integrated business solution.

CORPORATE MISSION STATEMENT

In achieving this vision, ASDION will:

Develop superior software products to meet the ever challenging demand in the market place;

Provide reliable high quality products and services;

Create a brand image for its products;

Establish a network of end-users for its products and to develop strategic marketing alliances with
Solution Providers;

Develop a highly trained technical staff force to ensure continuous back-up and technical support
for its products;

Provide a safe, healthy and socially responsible workplace and exercising social responsibility in
the wider community;

Continually seek new opportunities for growth in related technologies; and

Ensure it is a reliable, service and quality driven organisation responsive to customers and
shareholders

4
Asdion Berhad
(590812-D)

ANNUAL REPORT 2015

Group Corporate Structure

100%

Asdion Data Services


Sdn Bhd

100% 100%

Techtron Integrated Asdion Hospitality


Systems (S) P/L Solutions Sdn Bhd
97%

Asdion Software
(Shanghai) Co., Ltd
97%
100%
Asdion Software Pte Ltd
108 Talent Sdn Bhd
97%

Asdion Exim (Shanghai)


Co., Ltd
100%

Venice Sanctuary Sdn Bhd

100%
ASDION BERHAD
(590812-D) Asdion Project Synergy
Sdn Bhd

90%

Asdion Digital Advance


System Sdn Bhd

51%

Taz Logistics Sdn Bhd

36%

Sun Rock Development


Sdn Bhd

Wholly-owned Subsidiaries Subsidiaries Associate

5
Corporate Information

BOARD OF DIRECTORS REGISTERED OFFICE

TENGKU AZLAN IBNI SULTAN ABU BAKAR Plaza 138, Suite 18.03, 18th Floor, 138,
Chairman/ Independent Non-Executive Director Jalan Ampang,
(Appointed on 8 April 2015) 50450 Kuala Lumpur.
Telephone : 603-2161 5466
YAP TAI TEE Facsimile : 603-2163 6968
Group Managing Director / Chief Executive Email : systems@ssassociates.com.my
Officer

DATO MOHAMED RIDZUAN BIN NOR MD SHARE REGISTRAR


Executive Director
(Appointed on 8 April 2015) Systems & Securities Sdn Bhd (17394-P)
Plaze 138, Suite 18.03, 18th Floor, 138,
DATO YEN SOON AI Jalan Ampang,
Executive Director 50450 Kuala Lumpur.
(Appointed on 29 January 2015) Telephone : 603-2161 5466
Facsimile : 603-2163 6968
DATUK RAIME BIN UNGGI
Independent Non-Executive Director
(Appointed on 29 January 2015) CORPORATE OFFICE

SELVA RASAN A/L DATO PUSPA DAS Oval Tower @ Damansara


Independent Non-Executive Director Unit 28-8, 28th Floor
(Appointed on 24 December 2014) No. 685 Jalan Damansara, TTDI
60000 Kuala Lumpur
SEE POH YEE
Independent Non-Executive Director
PRINCIPAL BANKERS
MOHAMAD FARID BIN MOHD YUSOF
Non-Independent Non-Executive Director RHB Bank Berhad
(Appointed as Independent Non-Executive CIMB Islamic Bank Berhad
Director on 9 January 2015 and subsequently
re-designated to Non-Independent
Non-Executive Director on 10 June 2015) AUDITORS

LT GEN (rtd) DATUK KHAIRUDDIN BIN SJ Grant Thornton (AF: 0737)


MAT YUSOF Level 11, Sheraton Imperial Court
Chairman / Independent Non-Executive Director Jalan Sultan Ismail
(Resigned on 17 February 2015) 50250 Kuala Lumpur.
Telephone : 603-2692 4022
NA CHIANG SENG Facsimile : 603-2691 5229
Executive Director
(Resigned on 8 April 2015)
STOCK EXCHANGE LISTING
YAP TAI YEONG
Non-Independent Non-Executive Director ACE Market of Bursa Malaysia Securities
(Resigned on 29 January 2015) Berhad

LEOU THIAM LAI Stock Name : Asdion


Independent Non-Executive Director Stock Code : 0068
(Retired on 25 September 2014)

COMPANY SECRETARIES

Lee Wai Ngan (LS 00184)


Chan Toye Ying (LS 00185)

6
Asdion Berhad
(590812-D)

ANNUAL REPORT 2015

Profile of The Board of Directors

TENGKU AZLAN IBNI SULTAN ABU BAKAR


(Chairman/ Independent Non-Executive Director)

Tengku Azlan Ibni Sultan Abu Bakar, aged 66, a Malaysian, was appointed as a Chairman/ Independent
Non-Executive Director of the Company on 8 April 2015. Tengku Azlan is a member of the Royal family of
the state of Pahang in Malaysia, where he is the younger brother of the Sultan of Pahang, Sultan Ahmad
Shah. Tengku Azlan had been honored with several honorary title, such as Tan Sri, Dato Sri Paduka of
the Grand Order of Tuanku Jaafar (SPTJ, 1997) with title Dato Seri, Panglima Mangku Negara (PMN),
Sri Sultan Ahmad Shah Pahang (SSAP) award and Darjah Sultan Ahmad Shah Pahang (DSAP) award.

Tengku Azlan was a former Malaysian politician and a Member of the Parliament of Malaysia for the
Jerantut constituency in the state of Pahang from 1999 to 2013. Previously, he served as the Deputy
Minister in the Prime Ministers Department from 1999 to 2004. Tengku Azlan has also served as the
Deputy Minister of Transportation from 2004 to 2008. Tengku Azlan is a member of the United Malays
National Organisation (UMNO) party in the Barisan Nasional coalition government. He was the former
Head of Division in UMNO (Jerantut District) from 1998 to 2013. As at to date, he is still holding his
membership with UMNO.

In 2014, Tengku Azlan had been appointed as the Chairman of the Kuantan Port Authority, a position
that he continues to hold till today. Currently, Tengku Azlan also serves as a corporate advisor in Tijaz
Corporation Sdn Bhd. Apart from his role in the government sector and political segment, Tengku Azlan
was also appointed as the Chairman of the Malaysian Association for the Blind in year 2013, for which
he continues to serve the association until today.

YAP TAI TEE


(Group Managing Director / Chief Executive Officer)

Yap Tai Tee, aged 48, a Malaysian, is the Group Managing Director/Chief Executive Officer of Asdion
Berhad. He was appointed to the Board on 30 September 2004. In 1987, he was conferred a Diploma
in Electrical Engineering from the Singapore Polytechnic, Singapore. Subsequently, he graduated from
Lancaster University, United Kingdom, in 1989 with a Bachelor of Science (Honours) in Information
Engineering with First Class Honours. He is currently the General Manager of Techtron Integrated
Systems (S) Pte Ltd (TIS), a wholly-owned subsidiary of the Company, a position he has held since
1995. In this position, he is inter alia in charge of overseeing and managing the entire operations of
TIS. Prior to joining TIS, he was a research associate with Koeneman Capital Management Pte Ltd. He
was appointed as an Executive Director by Medilink-Global UK Limited (MGL), a listed company in
Alternative Investment Market of London Stock Exchange on 12 November 2008. He resigned as an
Executive Director of MGL on 6 of June 2012.

Recognising the potential of electronic access control for the hotel industry in the early 1990s, TIS
distributed TESA Electronic Access Control System (now Onity products) to penetrate into this niche
market, and made headway in this virtually unknown market. Mr Yaps exposure to hotel operations
helped him realise the strong demand and potential in business software applications, leading to software
development at TIS. Under the leadership of Mr Yap and with his vision, ASDION products now comprise
of advance and progressive integrated software solutions which have been successfully deployed to
operations in various service industries.

7
Profile of The Board of Directors (Contd)

DATO MOHAMED RIDZUAN BIN NOR MD


(Executive Director)

Dato Mohamed Ridzuan Bin Nor Md, aged 35, a Malaysian, was appointed as an Executive Director
of the Company on 8 April 2015. Dato Mohamed Ridzuan graduated with Merit in Masters of Science
in Finance, majoring Behavioural Finance from University of Portsmouth, United Kingdom in year 2005.
He began his career with MISC Berhad as a Tax Executive in year 2005. In MISC, he had initiated and
implemented a new tax structure and had led the Goods Services Tax (GST) Transformation program
in MISC and its group of companies.

In 2006, he joined AmInvestment Bank Berhad as an Assistant Manager with Equity Capital Markets
Department and was later promoted to Manager in year 2007. Subsequently, he left AmInvestment Bank
and co-founded Petrol One Resources Berhad (PORB) where he was appointed as Executive Director
of PORB. PORB is an oil and gas company specializing in offshore storage and was the first listed oil
and gas storage provider in Malaysia. Dato Mohamed Ridzuan has been instrumental in setting up the
company and bringing the company to its listed status. He also managed to raise over USD50 million
for the funding of PORBs maiden Floating Storage and Offloading project in Johor.

In 2011, he left PORB and appointed as Executive Director in CWorks Systems Berhad, a position that he
continues to hold till today. He is also a director and shareholder with 340,000 ordinary shares of RM1.00
each or equivalent to shareholding of 34% in Taz Logistics Sdn Bhd, a subsidiary of Asdion Berhad.

DATO YEN SOON AI


(Executive Director)

Dato Yen Soon Ai, aged 46, a Malaysian, was appointed as an Executive Director of the Company on 29
January 2015. Dato Yen attended Northwestern Business College, Chicago, Illinois, U.S.A. from 1989
to 1991. He has accumulated more than 20 years of working experience across various organization
and corporations and his competency is particularly in the commercial sector specializing in marketing
to corporate clients, business development and client relationship in diversified sectors.

He began his career as an Operations Manager in Malaysian Timber Trade Corporation Sdn. Bhd.
(MTTC), a contracting company undertaking the extraction and harvesting of timber for forest
concessionaires, concurrently involved in the production of rattan furniture. In 1996, he joined All Best
Furniture (M) Sdn. Bhd. (ABF) as Executive Director in the Operations Division, a company with forest
and timber concessions focused in logging and with its downstream activities being saw milling and
the manufacture of molded parts for the furniture industries in Malaysia. ABF was also responsible for
the harvesting of a forest totaling 10,000 acres in the state of Pahang. Subsequently he was promoted
to the position of Chief Executive Officer in All Best Timber (M) Sdn. Bhd. (ABT), a subsidiary of ABF.

In 2006, Dato Yen was seconded to Yoke Tank Installations Pte. Ltd. (YTI) and its group of companies
which he continues to hold until today. YTI is a company incorporated in the Republic of Singapore,
with its group of companies incorporated throughout South East Asia and East Asia, which are primarily
involved in the development of edible oil storage and bulking plants with an ancillary business of trading
in edible oil and fats.

8
Asdion Berhad
(590812-D)

ANNUAL REPORT 2015

Profile of The Board of Directors (Contd)

DATUK RAIME BIN UNGGI


(Independent Non-Executive Director)

Datuk Raime Bin Unggi, aged 45, a Malaysian, was appointed as an Independent Non-Executive Director
of the Company on 29 January 2015. Datuk Raime obtained a Master of Arts (Sociology) from Universiti
Utara Malaysia in year 2014 and a Diploma of Business Studies from Institut Teknologi Mara Sabah in
year 1993.

YB Datuk Raime is a Malaysian politician, where he is the Member of the Parliament of Malaysia for the
Tenom constituency in Sabah, representing the United Malays National Organisation (UMNO) party in
the governing Barisan Nasional coalition. Prior to that, Datuk Raime had joined the government sector
as an Assistant Administrative Officer from year 1997 to 2004.

Apart from his active roles in the political segment, Datuk Raime also contributed to the community
through his several positions in various statutory bodies, including but not limited to parties organisation,
social and voluntarily community in Malaysia, for instances:-

(i) Deputy Chairman of the Corporation Baitulmal Sabah (2005 2007)


(ii) Chairman of Desa Group of Companies, which is wholly-owned by the State Government of Sabah
(2008 current)
(iii) Board Member of Oilcorp Berhad (2008 September 2009)
(iv) Colonel (Honorary) RELA, Tenom District (2007 current)
(v) Patron Scouts Association, Tenom District (2008 current)
(vi) Chairman of Parliamentary Consultative Council, Tenom (2014 current)
(vii) Secretary of Barisan Nasional Backbenchers Club (Sabah) (BNBBC) (2008 current)
(viii) Chairman of the Ministry Of Agriculture & Agro-Based Industry Malaysia, Tenom District (2009
current)
(ix) Chairman of Welfare and Social Development Council (Mayang) for the Region of P.181 Tenom
(2009 current)
(x) Deputy Head of Division UMNO, Tenom (2013 current)

In recognition of his contribution towards the community of Sabah, the Governor from the Government
of Sabah had conferred Datuk Raime with Panglima Gemilang Darjah Kinabalu (PGDK), also known as
the Commander of the Order of Kinabalu. PGDK ranked second class of order among the five classes
of the Illustrious Order of Kinabalu, Sabah.

9
Profile of The Board of Directors (Contd)

Selva Rasan A/L DATO Puspa Das


(Independent Non-Executive Director)

Selva Rasan a/l Dato Puspa Das, aged 43, a Malaysian, was appointed as an Independent Non-Executive
Director of the Company on 24 December 2014. He is a fellow member of the Malaysian Institute of
Accountants, the Chartered Tax Institute of Malaysia, Financial Planning Association of Malaysia,
Institute of Public Accountants (Australia) and associate member of Certified Practising Accountants
(CPA) Australia. He is also an affiliate member to the Chartered Institute of Company Secretaries and
Administrators.

Mr. Selva has more than fifteen (15) years of audit and tax experience, starting his professional career
with PricewaterhouseCoopers and subsequently, establishing his own practice, Selva & Associates,
soon after he became a member of the Malaysian Institute of Accountants in year 2000. Mr. Selva is
also the Managing Director of Cyrel Tax Care Sdn. Bhd., which provides taxation advisory, compliance
and related services.

Mr. Selva is a Chairman of the Audit Committee, member of the Nomination Committee and Remuneration
Committee of the Company. Apart from serving as an Independent Non-Executive Director of the
Company, he is also a Director of Hytex Integrated Berhad.

SEE POH YEE


(Independent Non-Executive Director)

See Poh Yee, aged 38, a Malaysian, is a Technology Investor, Co-Founder and the Executive Director
of Nexgram Holdings Berhad since year 2005. He was appointed to the Board on 26 August 2013.
He obtained his Bachelor of Engineering degree, majoring in Computer Science from the University of
Manitoba, Canada in 1998.

He began his career at Lilo Media as Chief Technology Officer, and Technology Advisor for Microasia
Group, an e-commerce consulting firm in early 2000s. He and his core system engineers co-developed
MINDCEP platform, which empowered SOHOMOBILE, mCommerce-Suit and SMSJET, some of the key
component of mobile commerce software for Nextnation Network Sdn Bhd. Today, he oversees Nexgram
group of companies core technology research and development, architect and product design. He also
sits on the Investment Board for new technology startup, incubation and venture funding.

Mr See is a Director of Nexgram Holdings Berhad, a company listed on the ACE Market of Bursa
Malaysia Securities Berhad. He also serves as Chairman of the Nomination Committee, member of
Audit Committee and Remuneration Committee of the Company.

10
Asdion Berhad
(590812-D)

ANNUAL REPORT 2015

Profile of The Board of Directors (Contd)

MOHAMAD FARID BIN MOHD YUSOF


(Non-Independent Non-Executive Director)

Mohamad Farid Bin Mohd Yusof, aged 57, a Malaysian, was appointed as a Director of the Company
on 9 January 2015. He holds a Master in Business Administration from University of Northern Colorado,
USA. Encik Mohamad Farid began his career with Bank of Commerce Berhad (now known as CIMB Bank
Berhad) in 1984. During his tenure with the Bank, he was exposed to areas encompassing customer
services; business development & maintenance; analysis of business opportunities & risk; financial
analysis; loan portfolio management; loan recovery & restructuring; legal documentation; and planning,
organizing and control.

Encik Mohamad Farid left the commercial banking sector in 1995 to join KAF Discounts Berhad (now
known as KAF Investment Bank Berhad) as the General Manager cum Head, Debt Capital Market
Department. He was involved in assisting the management in formulating, implementing and monitoring
effective and sound investment approval policies, guidelines and procedures, and overseeing the
development and marketing of new businesses. He also assisted clients in project viability analysis
and the arrangement of fund raising through the issuance of private debt securities such as bonds,
medium-term notes and short-term commercial papers. He left KAF in early 2007 to set up his own
corporate and business consultancy outfit to assist corporations in fund raising exercises and providing
advisory services.

Mohamad Farid served as Chief Executive Officer of Primabaguz Sdn Bhd (PSB) from November 2009
until June 2012. During that period, he was also appointed as director in wholly-owned subsidiaries of
PSB, namely PAP Cashnet (M) Sdn Bhd, PAP Marketing Sdn Bhd and Next Choice Sdn Bhd.

He is a Director of Wintoni Group Berhad, a company listed on the ACE Market of Bursa Malaysia
Securities Berhad. He also serves as Chairman of the Remuneration Committee, member of the Audit
Committee and Nomination Committee of the Company.

Notes:

(i) All the above-named Directors of the Company have not been convicted for any offences (other than
traffic offences, if any) within the past ten (10) years and they do not have any conflict of interest
with the Company.
(ii) Details of attendance of the Directors at the Board Meetings and their shareholdings are set out
respectively in this Annual Report.

11
Audit Committee Report

The objective of the Audit Committee is to assist the Board in discharging its statutory duties and
responsibilities in relation to corporate governance, internal control systems, management and financial
reporting practices of the Company and to ensure proper disclosure to the shareholders of the Company.

MEMBERS OF THE AUDIT COMMITTEE

The current members of the Audit Committee are as follows:

Chairman : SELVA RASAN A/L DATO PUSPA DAS* (Independent Non-Executive Director)
(Appointed on 24 December 2014)

Members : SEE POH YEE (Independent Non-Executive Director)


: MOHAMAD FARID BIN MOHD YUSOF (Non-Independent Non-Executive Director)
(Appointed on 29 January 2015)

(*Member of MIA)

SUMMARY OF THE TERMS OF REFERENCE

1. COMPOSITION

The composition of the Audit Committee appointed by the Directors pursuant to a resolution of
the Board of Directors must fulfil the following requirements:

(a) The Audit Committee must be comprised of no fewer than three (3) members;

(b) All Audit Committee members must be Non-Executive Directors, with a majority of them
being Independent Directors as prescribed in the Listing Requirements of Bursa Malaysia
Securities Berhad (Bursa Securities);

(c) The members of the Audit Committee shall elect a chairman, who shall be an independent
director from among their members;

(d) At least one member of the Audit Committee:

i. must be a member of the Malaysian Institute of Accountants; or

ii. if he is not a member of the Malaysian Institute of Accountants, he must have at least
three (3) years working experience and he must have passed the examinations specified
in part I of the 1st Schedule of the Accountants Act 1967 or he must be a member of
one (1) of the associations of accountants specified in Part II of the said Schedule of
the Accountants Act 1967; or

iii. a person who has fulfilled such other requirements as prescribed or approved by Bursa
Securities.

12
Asdion Berhad
(590812-D)

ANNUAL REPORT 2015

Audit Committee Report (Contd)

SUMMARY OF THE TERMS OF REFERENCE (CONTD)

1. COMPOSITION (CONTD)

(e) If a Member of the Audit Committee resigns or for any other reason ceases to be a Member
with the result that the number of Members is reduced below three (3), the Board of Directors
shall, within three (3) months of that event, appoint such number of new Members as may
be required to make up the minimum of three (3) Members.

(f) The terms of office and performance of the Audit Committee and each of its Members shall
be reviewed by the Board of Directors no less than once every three (3) years.

2. PROCEDURES OF MEETINGS

(a) Meetings shall be held not less than four (4) times in a financial year.

(b) The Committee may regulate its own procedures, in particular;

i. The calling of meetings;


ii. The notice to be given of such meetings;
iii. The voting and proceedings of such meetings;
iv. The keeping of the minutes; and
v. The custody, production and inspection of such minutes.

(c) Other Board members, senior management personnel, Internal and External Auditors may
be invited to attend meetings.

(d) Upon the request of the External Auditors, the Chairman of the Audit Committee shall convene
a meeting of the Committee to consider any matters the External Auditors believes should
be brought to the attention of the Directors or Shareholders. The External Auditors has the
right to appear and be heard at any meeting of the Audit Committee and shall appear before
the Committee when required to do so by the Committee.

(e) Written notice of the meeting together with the agenda shall be given to the Members of the
Audit Committee and the External Auditors, where applicable.

(f) The quorum for a meeting shall be two (2) provided always that the majority of Members
present must be Independent Directors and any decision shall be by a simple majority. The
Chairman shall not have a casting vote.

(g) The other Board Members, Financial Controller, the Head of Internal Audit (if any), any
employee of the Company and a representative of the External Auditors may be invited to
attend meetings. If necessary, the Audit Committee shall meet with the External Auditors
without any Executive Board Member present.

(h) The Company Secretary shall be the secretary of the Audit Committee.

13
Audit Committee Report (Contd)

SUMMARY OF THE TERMS OF REFERENCE (CONTD)

3. FUNCTIONS

The functions of the Committee are as follows:

(a) To recommend the nomination of a person or persons as External Auditors.

(b) To review the following and report the same to the Board of Directors:-

i. with the External Auditors, the audit plan;


ii. with the External Auditors, his evaluation of the system of internal controls;
iii. with the External Auditors, his audit report;
iv. the assistance given by the employees of the Company to the External Auditors;
v. the adequacy of the scope, functions and resources of the Internal Audit functions and
that it has the necessary authority to carry out its work;
vi. the Internal Audit programme and the results of the Internal Audit processes;
vii. on investigation undertaken and whether or not appropriate action was taken on the
recommendations of the Internal Audit function;
viii. the quarterly results and year-end financial statements, prior to the approval by the
Board of Directors, focusing particularly on:-
1. Changes in or implementation of major accounting policy changes;
2. Significant and unusual events;
3. Compliance with accounting standards and other legal requirements;
4. Any related party transaction and conflict of interest situation that may arise within
the Company or group including any transaction, procedure or course of conduct
that raises questions of management integrity;
5. Any letter of resignation from the External Auditors of the Company; and
6. Whether there is reason (supported by grounds) to believe that the Companys
External Auditors is not suitable for re-appointment.

(c) To discuss problems and reservations arising from the interim and final audits, and matters
the External Auditors may wish to discuss (in the absence of management where necessary).

(d) To keep under review the effectiveness of internal control systems and in particular review
the External Auditors management letter and managements response.

(e) To consider other topics, as agreed to by the Audit Committee and the Board of Directors.

14
Asdion Berhad
(590812-D)

ANNUAL REPORT 2015

Audit Committee Report (Contd)

4. AUTHORITY

The Committee shall, in accordance with the procedures determined by the Board and at the cost
of the Company;
(a) have explicit authority to investigate any matter within its term of reference;
(b) have the resources which are required to perform its duties;
(c) have full and unrestricted access to all information and documents relevant to its activities
as well as direct communication channels with the external auditors, person(s) carrying out
the internal audit function or activity and the senior management of the Group;
(d) be able to obtain independent/external professional advice; and
(e) be able to convene meetings with the external auditors, the internal auditors or both, excluding
the attendance of other executive directors and employees of the Company, whenever deemed
necessary.

5. AUDIT COMMITTEE MEETING

During the financial period from 1 April 2014 to 31 March 2015, four (4) Audit Committee Meetings
were held. Details of the attendance of each Committee Member are as follows:-

Name of Audit Committee Member Attendance Attendance

Selva Rasan a/l Dato Puspa Das (Chairman) (Appointed on 24 December 2014) 0/1
Leou Thiam Lai (Chairman) (Retired on 25 September 2014) 3/3
Mohamad Farid Bin Mohd Yusof (Appointed on 29 January 2015) 1/1
See Poh Yee 5/5
Yap Tai Yeong (Resigned on 29 January 2015) 4/4

6. ACTIVITIES OF THE AUDIT COMMITTEE

During the financial year, the activities of the Audit Committee included the following:

(a) Reviewed and recommended for Board approval the quarterly financial results for public
announcement;

(b) Reviewed the related party transactions that had arisen within the Company and Group;

(c) Reviewed and discussed the External Auditors findings during the course of their year end
audit and the managements response;

(d) Reviewed and recommended for Board approval the Groups audited financial statements;
and

(e) Reviewed the audit reports submitted by the Internal Auditor, if any.

15
Audit Committee Report (Contd)

7. INTERNAL AUDIT

(a) The Company has outsourced its internal audit function to a professional firm of consultants,
which provides objective evaluation of risk management and control systems in the auditable
services. All activities of the Internal Audit are reported to the Groups Audit Committee on
a half yearly basis.

(b) The audit committee reviewed periodic reports, provided by Group Internal Audit to the
audit committee, reporting on the outcome of the operations and systems audits conducted,
effectiveness of the system of risk management and internal controls implemented and
highlighting key control issues impacting the operations of the Group. In discharging its role,
Internal Auditors:

i. evaluates whether the Group is in compliance with internal policies and procedures,
applicable laws, guidelines and directives issued by regulatory bodies, and statutory
acts;

ii. evaluates the quality and appropriateness of managements approach to risk and control
in their framework objectives and effectiveness of risk management procedures;

iii. assesses the adequacy and effectiveness of internal controls systems implemented i.e.
accounting, system and operational controls, by giving opinion on the effectiveness of
the said controls, continuity and reliability of information systems and provide assurance
that sufficient controls are in place to safeguard assets;

iv. assesses the adequacy of controls to ensure the reliability (including accuracy and
completeness) of accounting records, financial reports and management information;
and

v. assists the management to review and strengthen the controls features to prevent
recurrence of fraud, errors, lapses and omissions and other significant control
weaknesses.

8. RISK MANAGEMENT

Audit Committee oversees the establishment of a robust risk management infrastructure, reviews
the adequacy and integrity of internal control systems and ensures that Group Risk Management
performs its duties independently of the risk taking activities. Group Risk Management provides
the central resource for developing tools and methodologies for the identification, quantification,
and management of the portfolio of risks taken by the Group as a whole.

16
Asdion Berhad
(590812-D)

ANNUAL REPORT 2015

Statement of Corporate Governance

1. BOARD OF DIRECTORS

The Board of Directors (Board) of Asdion Berhad (ASDION) recognises and subscribes to
the importance of the principles and best practices set out in the Malaysian Code on Corporate
Governance 2012 (Code) as a key factor towards achieving an optimal governance framework
and processes in managing the business and operational activities of the Company.

The Board belief and supports the good corporate governance practices is the fundamental
part of the Groups responsibility to protect and enhance shareholders value. Thus, the Board is
working towards ensuring full compliance with the principles and best practices of the Code. The
Boards commitment is reflected in the incorporation of various policies and the establishment of
the relevant committees.

The Board is pleased to disclose below a description on how the Group has applied the principles
of good governance and the extent to which it has complied with the best practices set out in the
Code.

A. The Board

The Board is bestowed with the duty and responsibility for the performance of the Group and
to ensure the interests of the shareholders are protected. The Board guides the Company on
its short and long-term goals, provides advice and directions on management and business
development issues while providing balance to the management of the Company.

The Board is responsible for the following:

Reviewing and adopting a strategic plan for the Group;


Identify risks and ensure the implementation of appropriate systems to manage these
risks;
Overseeing the conduct of the Groups business to evaluate whether the business is
being properly managed;
Succession planning, including appointing, training, fixing the compensation of and
where appropriate, replacing senior management;
Developing and implementing an investor relations programme or shareholders
communication policy for the Group; and
Reviewing the adequacy and the integrity of the Groups internal control systems and
management information systems, including systems for compliance with applicable
laws, regulations, rules, directives and guidelines.

All Board committees report to the Board. The Board meets on a regular and scheduled
basis, at least four (4) times a year.

For financial year ended 31 March 2015, all Directors attended the board meeting
according to the time in office.

17
Statement of Corporate Governance (Contd)

1. BOARD OF DIRECTORS (CONTD)

B. Composition and Board Balance

Presently, the Board comprises eight (8) members who are working closely as a team to
safeguard the interest of the company, shareholders as well as stakeholders.

The Board is chaired by an Independent Non-Executive Director and the other members
are made up of a Chief Executive Officer, who is also the Group Managing Director, two
(2) Executive Directorss, three (3) Independent Non-Executive Directors and one (1) Non-
Independent Non-Executive Director.

A brief profile of each Director is set out under the Profile of the Board of Directors of this
Annual Report.

The Board composition represents a mix of knowledge, skills and expertise in business,
financial, industrial and legal experience to effectively discharge its stewardship responsibilities
in spearheading the Groups growth and future direction. The Independent Non-Executive
Chairman is responsible for the Boards effectiveness and standard of conduct whilst the
Group Managing Director/ Chief Executive Officer has the overall responsibility to oversee
the business and operations. The clear division of responsibilities between these roles will
ensure a balance of power and authority.

Where areas of conflict of interest arise, the Director concerned will have to declare his/her
interest and abstain from participating in the decision making process.

The Company is in compliance with the Code as well as Rule 15.02 of the ACE Market Listing
Requirements of Bursa Malaysia Securities Berhad, which requires the Board to have at least
two (2) directors or one-third (1/3) of the Board to be Independent Directors.

C. Appointments and Re-election of Directors

All appointments of directors to the Board are properly made with an established and
transparent procedure and in compliance with the relevant rules of the relevant authorities.
Any appointment of additional director will be made as and when it is deemed necessary
by the existing Board with due consideration given to the mix and range of expertise and
experience required for an effective Board.

In accordance with the Companys Articles of Association, an election of Directors shall


take place each year at an Annual General Meeting and all Directors shall retire from office
once at least in every three (3) years. In addition, a Director who attains the age of seventy
(70) retires at every Annual General Meeting pursuant to the Companies Act, 1965. Directors
appointed by the Board are subject to retirement at the next Annual General Meeting held
following their appointments in accordance with the Companys Articles of Association. All
retiring Directors are eligible for re-election.

18
Asdion Berhad
(590812-D)

ANNUAL REPORT 2015

Statement of Corporate Governance (Contd)

1. BOARD OF DIRECTORS (CONTD)

D. Board Committees

In line with the Best Practices of the Code, the Company has established two (2) Board
Committees to assist in the performance of certain duties of the Board. The Board Committees
are made up of Non-Executive Directors, with the majority being Independent Directors. The
Board considers that the mix of commercial experience from the Non-Executive Directors
will complement the Executive Directors and create an effective Board.

(i) Nominating Committee

The Nominating Committee (NC) currently comprises:

See Poh Yee (Chairman)


Selva Rasan a/l Dato Puspa Das (Appointed on 29 January 2015)
Mohamad Farid Bin Mohd Yusof (Appointed on 29 January 2015)
Yap Tai Yeong (Resigned on 29 January 2015)
Leou Thiam Lai (Retired on 25 September 2014)

The NC is responsible for identifying and making recommendations of new nominees


to the Board for consideration, who shall then collectively decide on the candidates
to be appointed. The NC is reviewed on an annual basis, to ensure that the size of the
Board is optimum and that there is an appropriate mix of skills and experience and other
qualities, including core competencies in the composition of the Board.

(ii) Remuneration Committee

The Remuneration Committee (RC) currently comprises:

Mohamad Farid Bin Mohd Yusof (Chairman) (Appointed on 29 January 2015)


Yap Tai Yeong (Chairman) (Resigned on 29 January 2015)
See Poh Yee
Selva Rasan a/l Dato Puspa Das (Appointed on 29 January 2015)
Leou Thiam Lai (Retired on 25 September 2014)

The RCs function is to recommend to the Board on the remuneration packages of CEO
and Executive Directors of the Company in all its forms, drawing from outside advice as
necessary. Executive Directors shall play no part in decisions on their own remuneration.
The determination of the remuneration package for Non-Executive Directors shall be a
matter for the Board as a whole. The Director concerned shall abstain from deliberations
and voting on decisions in respect of his individual remuneration package.

19
Statement of Corporate Governance (Contd)

1. BOARD OF DIRECTORS (CONTD)

E. Board Meeting and Supply of Information

The Board meets at least quarterly to control and monitor the development of the Group.
Additional meetings will be convened as and when required. Comprehensive Board papers
are prepared prior to the Board meeting and sufficient notice is given to the Directors to review
the papers and agenda for the meeting. Generally, the Board papers provide information on
the operating results, financial, corporate development, minutes of Board Committees and
new proposals, if any. In furtherance of the Directors duties, all members, either as full Board
or in their individual capacities, will have access to all information of the Group.

Directors are also free to seek independent advice should the need arise and have direct
access to the advice and services of the Company Secretary.

The proceedings and resolutions reached at each Board meeting are recorded in the minutes
of the meetings, which are kept in the Minutes Book at the Registered Office.

Besides Board meetings, the Board exercises control on matters that require its approval
through circulation of Directors Resolutions.

The summary of attendance at the Board meetings held for the financial year ended 31 March
2015 is as follows:

Name of Directors Total No. of


Meetings Attended

TENGKU AZLAN IBNI SULTAN ABU BAKAR N/A


(Appointed on 8 April 2015)

YAP TAI TEE 10/11

DATO MOHAMED RIDZUAN BIN NOR MD N/A
(Appointed on 8 April 2015)

DATO YEN SOON AI 2/4
(Appointed on 29 January 2015)

DATUK RAIME BIN UNGGI 1/4
(Appointed on 29 January 2015)

SELVA RASAN A/L DATO PUSPA DAS 3/4
(Appointed on 24 December 2014)

SEE POH YEE 11/11

MOHAMAD FARID BIN MOHD YUSOF 4/4
(Appointed on 9 January 2015)

LT GEN (rtd) DATUK KHAIRUDDIN BIN MAT YUSOF 7/10
(Resigned on 17 February 2015)

NA CHIANG SENG (Resigned on 8 April 2015) 11/11



YAP TAI YEONG (Resigned on 29 January 2015) 7/7

LEOU THIAM LAI (Retired on 25 September 2014) 4/5

20
Asdion Berhad
(590812-D)

ANNUAL REPORT 2015

Statement of Corporate Governance (Contd)

1. BOARD OF DIRECTORS (CONTD)

F. Directors Training

All Directors have at least quarterly briefings and updates on the Group businesses, operations,
risk management, internal controls, finance and changes on the rules and regulations. In
addition, the directors attended various conference, seminars and programmes to enhance
their skills and knowledge to effectively discharge their duties as a director.

The Board encourages its Directors to attend talks, seminars, workshops and conferences
to update and enhance their skills and knowledge to enable them to carry out their roles
effectively as Directors in discharging their responsibilities towards corporate governance,
operational and regulatory issues. The Directors are briefed by the Company Secretary on
the letters and circulars issued by Bursa Securities, if any, at every Board meeting.

As at the end of the financial year under review, save and except for Tengku Azlan Ibni Sultan
Abu Bakar and Dato Yen Soon Ai, all the Directors of the Company had completed the
Mandatory Accreditation Programme as prescribed by the ACE Market Listing Requirements
of Bursa Malaysia Securities Berhad.

G. Directors Remuneration

The Board set up the Remuneration Committee on 2 December 2004 to review the policy and
make recommendations to the Board on the remuneration package and benefits annually
as accorded to the Executive Directors. The Executive Directors shall not participate in the
decision makings relating to their own remunerations.

Fees payable to the Directors are recommended by the Board with the approval from
shareholders at the Annual General Meeting. Generally, the remuneration package will be
structured according to the skills, experience and performance of the Executive Directors to
ensure the Group attracts and retains the Directors needed to run the Group successfully,
whereby the remuneration package for the Non Executive Directors will hinge on their
contribution to the Group in terms of their knowledge, and level of responsibilities undertaken
by non Executive Directors experience.

The breakdown of the remuneration of the Directors, categorised into appropriate components
for the financial year ended 31 March 2015 is as follows:-

Executive Non-Executive Total (RM)


Directors Directors

Salaries, allowance and bonus 278,975 292,491 571,466
Benefits-in-kind 35,233 35,233

Total 314,208 292,491 606,699

21
Statement of Corporate Governance (Contd)

1. BOARD OF DIRECTORS (CONTD)

G. Directors Remuneration (Contd)

The Directors remuneration are broadly categorised into the following bands:

Number of Directors
Executive Non-Executive Total (RM)

Below RM 50,000
RM 100,001 to RM 150,000 1 1
RM 150,001 to RM 200,000 1 1
RM 400,001 to RM 500,000

Total 2 2

2. SHAREHOLDERS AND INVESTORS RELATION

The Group recognises the importance of accountability to the shareholders and its investors, the
Board is committed to ensure that the shareholders and other stakeholders are well informed of
major development of the Company and the information is communicated timely to them through
the following:

(i) Timely quarterly results announcements and various announcements made to Bursa Malaysia
Securities Berhad which are available publicly on the internet via Bursa Malaysia Securities
Berhads website at http://www.bursamalaysia.com

(ii) Annual Report

(iii) Annual general Meeting (AGM)

AGM is used as a primary mode of communication to report on the Groups performance.


Notice of Annual General Meeting is issued at least twenty-one (21) days before the date of
meeting. At the Annual General Meeting, shareholders are encouraged to raise any questions
pertaining to any issues regarding the Group. The Chief Executive Officer, assisted by the
Directors are available to answer any queries and discuss matters pertaining to the business
activities of the Group. The AGM remains as the principal forum for dialogue with shareholders
who are encouraged to participate in the question and answer session. Executive Directors
and Chairman are available to respond to shareholders questions raised during the meeting;

(iv) As part of the Boards responsibility in developing and implementing an investor relations
programme, regular discussions are held between the Company and analyst/investors
throughout the year. Presentations based on permissible disclosures are made to explain
the Groups performance and major development programmes; and

(v) Other Channels of Communications

The Groups website at www.asdion.com which shareholders as well as members of the


public are invited to access for the latest information on the Group.

22
Asdion Berhad
(590812-D)

ANNUAL REPORT 2015

Statement of Corporate Governance (Contd)

3. ACCOUNTABILITY AND AUDIT

(a) Financial Reporting

In preparing the annual financial statements and quarterly announcements, the Directors took
steps to ensure a clear, balanced and understandable assessment of the Groups positions
and prospects. The Statement by Directors pursuant to section 169 of the Companies Act,
1965 is set out on page 44 of this Annual Report.

(b) Internal Controls

The Board recognises its responsibilities to maintain a sound system of internal controls to
safeguard shareholders investment and Groups assets. The Board has established an Audit
Committee to oversee the financial reporting and effectiveness of the internal control of the
Group. The review of the system of internal control is set out under the Statement on Internal
Control on pages 25 to 27 of this Annual Report.

(c) Audit Committee / Relationship with Auditors

The Audit Committee works closely with the external auditors and maintains a transparent
professional relationship with them. A summary of the activities of the Audit Committee during
the year are set out in the Audit Committee Report on pages 12 to 16 of this Annual Report.

4. COMPLIANCE STATEMENT

The Company is committed to achieve high standards of corporate governance throughout the
Group as well as the highest level of integrity and ethical standards in all of its business dealings.
The Board will continue to strive for the full compliance with the Malaysian Code of Corporate
Governance in the coming financial year.

5. CORPORATE SOCIAL RESPONSIBILITY

The Group believes that corporate organisations have a responsibility towards maintaining the
highest level of integrity in their dealings with all their stakeholders, including the local communities
where they operate. The Group corporate social responsibility (CSR) strategy goes along with the
Bursa Malaysia CSR Framework in areas of community, environment, workplace and marketplace.

A. COMMUNITY

The Group participates in The Yellow Ribbon Project which offers ex-offenders employment
opportunities.

23
Statement of Corporate Governance (Contd)

5. CORPORATE SOCIAL RESPONSIBILITY (CONTD)

B. ENVIRONMENT

We continue to promote the responsible usage of resources and the importance of environment
protection amongst our employees. The Group continue educating our staff on the importance
of energy conservation such as instilling good habit of switching off the light, air-conditioning
and switch the production machinery to standby mode during lunch time or when it is not
required or out from the office.

The Group stress on the commitment to streamline all internal transactions and communications
towards a paperless office to build the awareness of green environment. The Group also
participate in the recycle program that arranged by the relevant organisation.

C. WORKPLACE

The Group strive to adhere to stringent occupational health and safety practices, providing
a safer working environment for our workforce. The company encourage the employees
participates in various Health, Safety and Environment programmes that arranged by the
relevant organisation to instil awareness in our employee.

The Group believe training and development is very important in developing and upgrading
skills, knowledge and attitudes to ensure optimal performance. Thus, we constantly provide in-
house training programmes to enhance and increase employees job-related skills knowledge
and experience. The Group also committed to career development of our management and
support staff, by sponsoring key personnel for training and seminars.

The Group had organised throughout the year to create social balance and maintain harmony
and build better rapport such as social gatherings, company trips, team building activities
and yearly reviews. Staff gatherings, including open house for the major festivities, are also
organised to encourage more interaction amongst our employees.

D. MARKET PLACE

Good business ethics should be a part of every business, therefore the Group belief that
established behavioural standards and written codes of ethical conduct can help bolster
virtuous values and promote ethical organisational behaviour.

24
Asdion Berhad
(590812-D)

ANNUAL REPORT 2015

Statement of Risk Management and Internal Control

INTRODUCTION

The Malaysian Code on Corporate Governance (Code) requires listed companies to establish a sound
risk management framework and internal control system to safeguard shareholders investments and
its assets. In this respect, the Board of Asdion Berhad is pleased to present the following Statement
on Risk Management and Internal Control which was prepared pursuant to the Listing Requirements
and after taking consideration of the guideline as guided by the Statement on Risk Management and
Internal Control Guidelines for Directors of Listed Issuers.

BOARD RESPONSIBILITY

The Board of Directors recognises the importance of a sound risk management frame work and internal
control system for good corporate governance practices covering financial and operation activities to
safeguard shareholders investment, the Groups assets and customers interest.

The Board also acknowledges its primary responsibility to ensure that the principal risks in the Group
are identified, measured and managed with appropriate internal control system, and to ensure that the
effectiveness, adequacy and integrity of the internal control system are reviewed on an ongoing basis.
The system of internal control is designed to manage the Groups risk within acceptable risk profile,
rather than eliminate the risk of failure to achieve Groups policies and business objectives, and provides
reasonable assurance against material errors, misstatement or irregularities.

RISK MANAGEMENT

The Group consists of several companies, each of which has its own management and internal control
structures based on the frameworks and guideline given by the Board. Operating management of each
business unit bears responsibility for the identification and mitigate of major business risks and each
maintains controls and procedures appropriate to its own business environment. Regular reports and
meeting from the heads of the respective subsidiaries confirming their systems and procedures are in
place to identify, control and report on the major risks such as credit risk, operational risk, market risk,
IT risk, liquidity risk and etc. These are being escalated and reviewed by the Board.

KEY ELEMENTS OF THE SYSTEM OF INTERNAL CONTROL

The Managing Director and senior management team monitor the day-to-day affairs of the Group by
attending scheduled meetings both at management and operational levels and review their performance
and operation reports. These include technical and operations meetings and management review
meetings for the subsidiaries.

The key control processes established in reviewing the adequacy and integrity of the system of internal
control include the following:-

1. A formal organisation structure for the Group and subsidiaries have been established with defined
reporting lines of authority, responsibility and accountability. Authority limits are also imposed on
Executive Directors and management within the Group in respect of the day-to-day operations to
ensure proper accountability and segregation of duties.

25
Statement of Risk Management and Internal Control (Contd)

KEY ELEMENTS OF THE SYSTEM OF INTERNAL CONTROL (contd)

The key control processes established in reviewing the adequacy and integrity of the system of internal
control include the following (contd):-

2. There are clear definition of authorisation procedure for major operating functions including
purchases, capital expenditures, payment, credit control and stock control. Authority of the Directors
is required for key treasury matters including loan and trade financing, cheque signatories and
opening of bank accounts.

3. There is a budgeting and business planning process each year to establish plans and targets for
each operating unit. The performance of each operating unit is monitored through monthly reports.

4. The Groups management team meets regularly to review the Group performance, monitors the
business development, discusses and resolves key operational and management issues and
reviews the financial performance against the business plan and budget for each operating unit
within the Group. The management also regularly highlights the significant issues and changes
in the business, major policy matters, external environment affecting the Group and financial
performance of each operating unit to the Board.

5. The Audit Committee will also review the internal audit functions, internal audit reports and monitor
the status of the implementation of corrective actions to address internal control weaknesses.

6. Management has established human resource policies and procedures, which encompasses a
wide spectrum of human resource management, including recruitment, performance appraisal
and promotion, resignation/termination of employment, training and development, benefits and
disciplinary action. The policies and procedures are compiled into an Employee Handbook, and
made readily available to staff at their convenience.

INTERNAL AUDIT FUNCTION

The Group outsources its internal audit function to a professional firm of consultants, which provides
the Board with much of the assurance it requires regarding the effectiveness as well as the adequacy
and integrity of the Groups system of risk management and internal control.

Internal audits are carried out on-going review process of the operations to access the effectiveness
of the control environment and to highlight significant risks as well as areas requiring improvements.

Based on the audits, the internal auditors will recommend on areas of improvement and at subsequent
audits, they will conduct follow-up review to determine whether improvements have been made.

The cost incurred for the internal audit function for the year ended 31 March 2015 amounted to
RM7,500.00.

26
Asdion Berhad
(590812-D)

ANNUAL REPORT 2015

Statement of Risk Management and Internal Control (Contd)

CONCLUSION

The Board is of the view that the state of the Groups internal control system is generally adequate and
effective in mitigating risks to achieve its business objective. Continuous review of its internal control
system would be carried out in line with the changes in the business and relevant laws and regulations
to ensure its effectiveness in safeguarding shareholders investment and the Groups assets.

This statement is made in accordance with a resolution of the Board of Directors on 14 August 2015.

REVIEW OF THE STATEMENT BY EXTERNAL AUDITORS

The external auditors have reviewed this Statement on Risk Management & Internal Control for inclusion
in the annual report of the Company for the year ended 31 March 2015 and reported to the Board that
nothing has come to their attention that warrants them to believe that the statement is inconsistent with
their understanding of the process adopted by the Board in reviewing the adequacy and integrity of the
system of risk management and internal controls.

DIRECTORS RESPONSIBILITY STATEMENT

The Director of the Company are required to ensure that the financial statements for each financial year
are properly drawn up in accordance with the provisions of the Companies Act, 1965 and applicable
approved MASB accounting standards in Malaysia so as to give a true and fair view of the state of affairs
of the Group and the Company as at the end of the financial year and of the results and cash flows of
the Group and the Company for that period.

In the opinion of the Directors of Asdion Berhad, no circumstances have arisen since the last audited
financial statements of Asdion Berhad and its subsidiaries which have adversely affected the trading or
the value of the assets of Asdion Berhad or its subsidiary companies.

27
Additional Compliance Information

1. Share Buy Back

No share buy back scheme was in place during the financial year ended 31 March 2015.

2. Options, Warrants or Convertible Securities Exercised in the Financial Year Ended 31 March
2015

As at 31 March 2015, 52,191,260 Warrants 2014/2019 remained unexercised.

3. Depository Receipt Programme

During the financial year under review, the Company did not sponsor any depository receipt
programmes.

4. Sanctions and/or Penalties

There were no sanctions and/or penalties imposed on the Company and its subsidiaries, Directors
or management by the relevant regulatory bodies during the financial year.

5. Non-Audit Fees

Non-audit fees paid out to external auditors by the Group for the financial year ended 31 March
2015 was RM5,000.

6. Profit Guarantee

The Company did not issue any profit guarantee during the financial year.

7. Utilisation of Proceeds

(a) Proceeds raised from Private Placement exercise completed on 31 March 2014

On 31 March 2014, Asdion had completed the private placement of 29,227,000 new ordinary
shares of RM0.10 each in Asdion (Placement Shares) with 43,840,500 detachable warrants
(Private Placement). The Company had raised a total of RM13.91 million from the Private
Placement.

Since the completion of the Private Placement, the Company has yet to identify any potential
land bank for its property investment and development business.

On 30 January 2015, Asdion announced that the Company had entered into a share sale
agreement with Dato Mohamed Ridzuan bin Nor Md for the acquisition by Asdion of 510,000
ordinary shares of RM1.00 each in TAZ Logistics Sdn Bhd (TAZ), representing 51% of the
issued and paid-up share capital of TAZ for a cash consideration of RM6 million (Acquisition
of TAZ). The Acquisition of TAZ was completed on 6 February 2015.

28
Asdion Berhad
(590812-D)

ANNUAL REPORT 2015

Additional Compliance Information (Contd)

7. Utilisation of Proceeds (Contd)

(a) Proceeds raised from Private Placement exercise completed on 31 March 2014 (Contd)

On 22 December 2014, Top Valley Properties Sdn Bhd (Top Valley) had entered into an Off
Take Agreement cum Sale and Purchase Agreement with Nexgram Land Sdn Bhd (a wholly-
owned subsidiary of Nexgram Holdings Berhad) (Developer) and MyAngkasa Bina Sdn Bhd
(Purchaser) whereby Top Valley and the Developer have agreed to sell and the Purchaser
has agreed to purchase the entire mixed property development project to be undertaken by
the Developer on a parcel of land which is to be identified (Selangor Project). Subsequently,
Top Valley has identified the development land for the Selangor Project.

On 12 February 2015, at the invitation of Top Valley, Asdion had entered into a Joint Venture
Agreement with Top Valley to participate in the expected economic benefits of the development
of the Selangor Project on a joint venture basis for a total cash consideration of RM6 million
(Participation Sum) (JV Arrangement). The JV Arrangement was deemed completed
following the payment of the Participation Sum by Asdion to Top Valley on the same date.

Arising from the acquisition of TAZ and JV Arrangement, the Company intends to vary the
utilisation of proceeds raised from the Private Placement and to channel the funds raised to
the following uses:-

Purpose of proceeds Original Actual Deviation Revised proposed


proposed utilisation utilisation of proceeds
utilisation as at
of proceeds 24 July 2015
as set out in
the circular
dated
12 February
2014
Amount Amount Amount Amount Expected
timeframe
for
utilisation
RM000 RM000 RM000 RM000

(i) To finance the acquisition 13,362 (3) (4)


13,362
and/or development of
land

(ii) Estimated expenses in (1)


550 (1)
360 190
relation to the Private
Placement

(iii) Working capital (1)


190 (190) (4)
1,362 Within
24 months

(iv) Acquisition of TAZ 6,000 (6,000) (4)


6,000 Utilised

(v) JV Arrangement 6,000 (6,000) (4)


6,000 Utilised

Total (2)
13,912 13,362

29
Additional Compliance Information (Contd)

7. Utilisation of Proceeds (Contd)

(a) Proceeds raised from Private Placement exercise completed on 31 March 2014 (Contd)

Notes:-
(1) The actual expenses for the corporate exercise in relation to the Private Placement was lower than
the estimated expenses for the said exercise, hence the remaining amount has been allocated to
working capital of Asdion and its subsidiaries (Asdion Group or the Group).
(2) As disclosed in the circular to the Companys shareholders dated 12 February 2014, the total
amount of proceeds to be raised was up to RM16.1 million, based on the illustrative issue price
of RM0.550 per Placement Share. The actual proceeds raised was approximately RM13.9 million,
based on the actual issue price of RM0.476 per Placement Share.
(3) This amount was initially earmarked to finance the acquisition and/or development of land. On 1
April 2014, the Company entered into an agreement with Premium Secretaries Sdn. Bhd. (PSSB)
to appoint PSSB as a consultant to acquire land(s) in Johor (Agreement). Upon the execution
of the Agreement, this amount was used as a refundable deposit and paid to PSSB (Deposit)
in accordance with the terms and conditions of the Agreement. As at 12 September 2014, PSSB
has not identified any potential land banks and has refunded the Deposit to the Company.
(4) The amount that was originally earmarked to finance the acquisition and/or development of land
has been utilised to fund the Acquisition of TAZ (Proposed Variation 1) and the JV Arrangement
(Proposed Variation 2). The balance proceeds of approximately RM1.36 million is proposed to
be allocated to fund the working capital of the Group (Proposed Variation 3). The Proposed
Variation 1, Proposed Variation 2 and Proposed Variation 3 shall collectively be referred to as the
Proposed Variations.
(5) As per the announcement made by the company on 28 April 2015, the company shall seek the
shareholders approval on the Proposed Variations at an EGM to be convened.

(b) Proceeds derived from Disposal of Property completed on 19 May 2015

On 1 December 2014, the Board announced that the Company had on the same day, entered
into a Sale and Purchase Agreement with Environmental Science (M) Sdn Bhd (ESSB) for
the proposed disposal of a property comprises a six (6) storey individually designed office
cum factory building with a covered rooftop level and a single storey guard house bearing the
postal address of No. 9, Persiaran Industri, Bandar Sri Damansara, 52200 Kuala Lumpur to
ESSB for a total disposal consideration of RM9,200,000 (Disposal Consideration) (Proposed
Disposal)

The Proposed Disposal has been completed on 19 May 2015 in accordance with the terms
and conditions of the Sale and Purchase Agreement.

30
Asdion Berhad
(590812-D)

ANNUAL REPORT 2015

Additional Compliance Information (Contd)

7. Utilisation of Proceeds (Contd)

(b) Proceeds derived from Disposal of Property completed on 19 May 2015 (Contd)

The details of the utilisation of the proceeds derived from the Proposed Disposal are as
follows:-

Purpose of proceeds Original Actual Proposed utilisation of


proposed utilisation the remaining Disposal
utilisation as at Consideration
of Disposal 24 July 2015
Consideration
as set out in
the circular
dated
20 January
2015
Amount Amount Amount Expected
timeframe
for
utilisation
RM000 RM000 RM000

(a) To fund future property (1)


4,000 (1)
4,000 Within 24
development project(s) months

(b) Acquisition of assets(s) / (2)


1,500 (200) (2)
1,300 Within 24
business(es) months

(c) Repayment of bank 1,300 (1,300) Utilised


borrowing

(d) Working capital (3)


1,700 (550) (3)
1,150 Within 12
months

(e) Estimated expenses 700 (700) Utilised


i n re l a t i o n t o t h e
Proposed Disposal

Total 9,200 (2,750) 6,450

31
Additional Compliance Information (Contd)

7. Utilisation of Proceeds (Contd)

(b) Proceeds derived from Disposal of Property completed on 19 May 2015 (Contd)

Notes:-
(1) The amount has not been earmarked for specific property development projects at this juncture
as our Group is in the process of evaluating suitable property development projects to be carried
out in Peninsular Malaysia. The utilisation shall include the initial/preliminary costs to be incurred
in relation to property development projects such as land clearance cost, consultation fee, survey
fee and piling cost of which the exact breakdown and quantum to be utilised for the specific
purposes have not been determined. The Company will make the appropriate announcement, if
required, in respect of the property development projects identified in due course.
(2) Our Group is in the midst of identifying other business opportunities to expand our business in
the property investment and development division, which include acquisition of potential land
banks and/or equity interest in potential property investment and/or property development
company(ies), of which the breakdown for the utilisation cannot be determined at this juncture.
Our Group will make the appropriate announcement, if required, in respect of the acquisition of
asset(s)/business(es) identified in due course.
(3) Working capital for on-going operational activities of our Group primarily consists of operating and
administrative expenses and payment to trade creditors of which the breakdown for the utilisation
has yet to be determined at this juncture.


8. Material Contract Involving Directors and Substantial Shareholders

There were no material contracts entered into by the Company and its subsidiaries involving the
interests of Directors and substantial shareholders during the financial year under review.

9. Material Contracts Relating to Loans

There were no material contracts relating to loan entered into by the Company and its subsidiaries
involving Directors and major shareholders.

10. Revaluation Policy on Landed Properties

The Group does not have a revaluation policy on landed properties.

11. Recurrent Related Party Transactions Statement

During the financial year, the Company did not enter into any recurrent related party transactions
of revenue or trading nature.

32
Asdion Berhad
(590812-D)

ANNUAL REPORT 2015

Chairmans Statement

Dear Valued Shareholders,

On behalf of the Board of Directors, I have great pleasure in presenting the Annual Report and the
Financial Statements of the Group and the Company for the financial year ended (FYE) 31 March 2015.

Financial Performance

For the financial year under review, the Groups revenue decreased by approximately 1% to RM4.32
million against previous financial year (FYE 2014) of RM4.37 million. However, the gross profit increased
by approximately 54% to 3.15 million in FYE 2015 against FYE 2014 of RM2.04 million. The significant
increase in the gross profit was contributed by the revenue generated from a newly acquired subsidiary
involved in the logistics business.

Despite a decline in revenue, the Group managed to reduce its Loss Before Tax (LBT) by 30% from
over RM3.38 million LBT as registered in FYE 2014 to RM2.37 million. The significant reduction in LBT
was mainly attributed to the series of corporate and business reorganisations starting from 2010 aimed
at strengthening and redefining the Groups business direction, which contributed to the better operating
performance by the various operating subsidiaries.

Corporate Development

Asdion has been incurring losses for the past few years, the Board has taken proactive measures to
enhance the Groups revenue and profitability in a bid to improve its financial condition.

Several strategies are highlighted as follows:

1. Regional market expansion plan

Despite the global financial uncertainty in the Euro Zone and the U.S.A and with rising labour
costs and high material prices in China, the Group remains confident on its targets which are the
Indonesia and Myanmar markets. The Group shall intensify its marketing efforts in penetrating the
targeted markets. With its past track records and credentials of delivering cost effective solutions
for projects, the Group believes that these new markets will provide growth for the Group in terms
of profitability in the coming years.

2. Strengthen the range of products, services and solutions

In enhancing the revenue and profitability, the Group has to constantly improve and enhance its
range of products, services and solutions through its continuous product improvement efforts.

The Groups suite of solutions including the SYMPHONY hospitality solution suite, are undergoing
a major shift to support cloud computing, in order to take full advantage of cloud computings
benefits such as lower costs, higher speed and connectivity which allows solutions to be adopted
on the go. This new development allows the Group to market SYMPHONY in innovative packages
such as Software as a Service (SaaS), Pay As You Use or as a commission based model; serving
guests who are increasingly gravitating towards self-service or do-it-yourself service methods
using their mobile/internet connected devices.

33
Chairman Statement (Contd)

2. Strengthen the range of products, services and solutions (Contd)

Going forward, in meeting the Groups objective of enhancing its revenue and profitability, the Group
will continue to explore and assess other viable business ventures in expanding and diversifying
its range of products, services and solutions, within the same or in complementary sectors. The
Group is also exploring the possibility of acquiring other businesses/assets in a different industry
in order to diversify from the competitive nature of its existing software and information technology
businesses. In such an event, the Group will carefully consider the risks involved and will recruit
the relevant expertise if it eventually decides to invest in a new business.

3. Working capital

In fiscal year 2015, the Group has continued to embark on the following exercises to increase
working capital to enable the Group to take on new projects and/or new investment opportunity
should it arise.

On 3 June 2014, the Company announced that it is proposing to undertake a proposed private
placement of up to 200 million new irredeemable convertible preference shares A (ICPS A) and
new irredeemable convertible preference shares B (ICPS B) of RM0.01 per ICPS at an issue price
of RM0.045 per ICPS in the Company.

On 5 August 2014, the Board has decided to revise the utilisation of proceeds to be raised
from the Proposed Private Placements after taking into consideration the progress of the
negotiations with the relevant parties on the potential property development project identified as
follow:-

(I) Proposed Private Placement of up to 200.0 Million new IPCS A of RM0.01 per ICPS A at an
issue price of RM 0.045 per ICPS A in the company (Proposed Private Placement A);

(II) Proposed Private Placement of up to 200.0 Million new ICPS B of RM0.01 per ICPS B at an
issue price of RM 0.045 per ICPS B in the company (Proposed Private Placement B);

(The Proposed Private Placement A and Proposed Private Placement B are collectively referred
to as Proposed Private Placements)

(III) Proposed increase in the authorised Share Capital of the company from RM 50.0 million
comprising 500.0 million ordinary shares of RM0.10 each in AB (AB Share or Shares) to
RM 1.0 billion comprising 9.96 billion AB Shares, 200.0 million ICPS A and 200.0 million ICPS
B (Proposed increase in authorised share capital) and

(IV) Proposed Amendments to the Memorandum and Articles of Association (M&A) of AB


(Proposed amendments)

4. Investment in new business(es) or assets

In line with Asdions diversification into property investment and development, the Company
entered into a Joint Venture Agreement with Top Valley Properties Sdn Bhd(1) upon their invitation
on 12 February 2015 to participate in the expected economic benefit of a property development
project on a joint venture basis which entails the construction and development of residential and
commercial buildings. The Joint Venture Agreement serves as an initial foray of the Company into
property investment and development segment.

34
Asdion Berhad
(590812-D)

ANNUAL REPORT 2015

Chairman Statement (Contd)

4. Investment in new business(es) or assets (Contd)

To further expand the Groups business portfolio and diversify its revenue sources, the Company
has also ventured into the logistics business by acquiring 51% of equity interest in TAZ Logistics
Sdn Bhd(1) on 30 January 2015. The rationale for the acquisition was due to the attractive growth
prospects of the logistics sector in Kuantan, details of which are as set out in the Companys
announcement dated 30 January 2015. The Board believes that the acquisition will potentially
provide the Group with another profit avenue, thus improving the financial performance of the
Group in the future.

The Board is constantly on the lookout for good business opportunities that will yield the greatest
return for our shareholders and investors in the long term.

Notes:
(1)
As per the announcements made by the company on 28 April 2015, the company shall seek the
shareholders approval on the proposed diversification of the business of Asdion and its subsidiaries
to include the business of logistics and the proposed ratification of the joint venture arrangement with
Top Valley Properties Sdn Bhd at an EGM to be convened.

5. Dividends

The Board of Asdion does not recommend any dividend in respect of the financial year ended 31
March 2015.

6. Business Review and Outlook

Despite the global environment remaining challenging with the on-going European debt crisis and
the slowdown of Chinas economy growth, the Malaysian economy is expected to grow at a steady
pace of 5% to 6% which continues to be supported by key driver of growth in domestic demand
and gradual improvement in the external sector.

(Source: Malaysian Economy First Quarter 2015, Ministry of Finance, Malaysia)

The International Data Corporation (IDC) expects overall ICT growth in 2015 to be similar to 2014
at 7.6%, it expects Asia Pacific IT spending in 2015 to perform as well as it has in 2014, despite the
ongoing world-wide economic risk environment. IDC expect the spending in the IT in Asia Pacific
split between hardware, software, services and telecom services to remain quite stable through
2016.

7. Research & Development

The Groups R&D is essentially the key to ensure the continuity of the Asdion solutions evolvement
and competing in the market.

As mentioned on the Note (ii) on the strategy to enhance the Groups revenue and profitability at
the Corporate Development section, the Groups suite of solutions are undergoing a major shift to
support cloud computing.

The migration to cloud computing has started in 1st Quarter 2015 and the beta version is expected
to be completed sometime in 3rd Quarter 2015. The new re-designed SYMPHONY hospitality
solution will be optimised to take advantage of the flexibility and convenience provided by the
internet, cloud-computing and the proliferation of mobile devices. Designed to be modular, it is
intended to serve the needs of emerging budget/ boutique hotels and hotel chains which are getting
the bulk of their bookings through the internet. The estimated costs of the cloud computing shift
are estimated at RM250,000 to be financed by internally generated funds.

35
Chairman Statement (Contd)

7. Research & Development (Contd)

The Groups other solutions include Sonata Food & Beverage POS Systems and Soprano CRM
Systems which are currently under evaluation for a similar shift into cloud computing. Sonata Food
& Beverage POS Systems is a Windows-based, touch-screen system that is designed to increase
the operating efficiency of fast food, casual dining or fine dining restaurant and/or food and beverage
operations. Further, Soprano CRM Systems is a Customer Loyalty and Retention Program that
provides details of every customer such as sales history, loyalty features and redemption.

The Group is targeting to finalise the development specification of these aforesaid 2 solutions after
the completion of the SYMPHONY migration, which is expected to be in 3rd Quarter this year. As
the plan to shift the Sonata Food & Beverage POS Systems and Soprano CRM Systems to cloud
computing is still in the preliminary stages, the estimated timeframe for completion and estimated
costs are unavailable at this juncture.

Prospects

The Group believe that the performance of the company will improve in the coming years as the outlook
for the emerging economies is more favourable and well supported by domestic and regional demand
in spite of the vulnerable external environment.

oving forward, the Group will continue pursuing cost cutting measures to keep the operating costs of
M
the Group under control by redefining the way the Group carries out its business operations. Despite
the cost control measure, the Group will continue to invest in human resource by employing capable
people equipped with the right experience, knowledge and skills to fill up senior, middle management and
technical positions to implement business rationalisation strategies, by focusing on effective marketing
activities, penetrating new unsaturated overseas markets, developing new solutions and services. The
measurements are intended to ultimately achieve the overall objective of turning around the financial
performance of the Group.

arring any unforeseen circumstances, the Board expects the Group to register positive growth and
B
improve on its earnings and financial position.

Appreciation

n behalf of the Board, I would like to express our sincere appreciation to the management team and
O
staff who are integral to the Groups success for their unwavering commitment and dedication and to
our valued customers, bankers, business associates, regulatory authorities and shareholders for their
continuing support and confidence in the Group.

ast but not least, to all my fellow Board members, I thank you for your invaluable continuing guidance
L
and support.

Thank you,

TENGKU AZLAN IBNI SULTAN ABU BAKAR


CHAIRMAN

36
Asdion Berhad
(590812-D)

ANNUAL REPORT 2015

Financial
Statements

Directors Report ... 38

Statement by Directors ... 44

Statutory Declaration ... 44

Independent Auditors Report ... 45

Statements of Financial Position ... 47

Statements of Profit or Loss and


Other Comprehensive Income ... 49

Statements of Changes in Equity ... 51

Statements of Cash Flows ... 54

Notes to the Financial Statements ... 57

37
Directors Report

The Directors hereby submit their report together with the audited financial statements of the Group
and of the Company for the financial year ended 31 March 2015.

PRINCIPAL ACTIVITIES

The Company is principally engaged in the businesses of investment holding, software development,
information communication technology and related services. The principal activities of the subsidiaries
are set out in Note 5 to the financial statements. There have been no significant changes in the nature
of these activities during the financial year.

RESULTS

Group Company
RM RM

Loss after taxation for the financial year (2,599,070) (1,849,474)

Attributable to:
Owners of the Company (2,810,009) (1,849,474)
Non-controlling interests 210,939

(2,599,070) (1,849,474)

DIVIDENDS

No dividend was paid since the end of the previous financial year and the directors do not recommend
the payment of any dividend for the current financial year.

RESERVES AND PROVISIONS

There were no material transfers to or from reserves or provisions during the financial year.

ISSUE OF SHARES AND DEBENTURES

There was no issuance of shares or debentures during the financial year.

38
Asdion Berhad
(590812-D)

ANNUAL REPORT 2015

Directors Report (Contd)

WARRANTS

The Company had on 25 March 2014, issued 52,191,260 warrants to all shareholders of the Company
on the following basis:-

(a) Issuance of 8,350,760 free warrants (Free Warrants) on the basis of one (1) Free Warrant for every
ten (10) existing ordinary shares of RM0.10 each in the Company; and

(b) Private placement of 29,227,000 new shares (Placement Shares), together with 43,840,500
detachable warrants (Placement Warrants) on the basis of three (3) Placement Warrants for every
two (2) Placement Shares subscribed.

The Free Warrants and Placement Warrants (Collectively defined as Warrant 2014/2019) were listed
on the ACE Market of Bursa Malaysia Securities Berhad on 31 March 2014.

As at 31 March 2015, 52,191,260 Warrants 2014/2019 remained unexercised.

The ordinary shares issued from the exercise of warrants shall rank pari passu in all respects with the
existing issued ordinary shares of the Company except that they shall not be entitled to any dividends,
distributions, rights, allotments and/or any other forms of distribution where the entitlement date precedes
the relevant date of the allotments and issuance of the new share arising from the exercise of warrants.

The main features of the Warrants 2014/2019 are as follows:-

(i) Each warrant will entitle the registered holder to subscribe for one (1) new ordinary shares of par
value of RM0.10 each in the Company at an exercise price of RM0.50 each subject to adjustments
in accordance with the conditions stipulated in the Deed Poll;

(ii) The exercise price of the warrants shall be determined and fixed by our Board at a later date where
in any event shall not be lower that the par value of Asdion Shares of RM0.10 each;

(iii) The warrants may be exercised at any time on or before the maturity date falling date five (5) years
(2014/2019) from the date of issue of the warrants on 25 March 2014. Warrants not exercised after
the exercise period will thereafter lapse and cease to be valid;

(iv) The new shares to be issued pursuant to the exercise of the warrants shall, upon allotment and
issue, rank pari passu in all respects with the existing ordinary shares of the Company in issue
except that they will not be entitled to any dividends, rights, allotments and/or any other form of
distribution, the entitlement date of which is before the allotment and issuance of the new shares
and

(v) The persons to whom the warrants have been granted have no rights to participate in any distributor
and/or after of further securities in the Company until/and unless warrants holders exercise their
warrants for new shares.

39
Directors Report (Contd)

DIRECTORS

The Directors in office since the date of the last report are as follows:-

Yap Tai Tee


See Poh Yee
Selva Rasan A/L Dato Puspa Das (appointed on 24.12.2014)
Mohamad Farid Bin Mohd Yusof (appointed on 9.1.2015)
Dato Yen Soon Ai (appointed on 29.1.2015)
Datuk Raime Bin Unggi (appointed on 29.1.2015)
Tengku Azlan Ibni Sultan Abu Bakar (appointed on 8.4.2015)
Dato Mohamed Ridzuan Bin Nor Md (appointed on 8.4.2015)
Leou Thiam Lai (retired on 25.9.2014)
Yap Tai Yeong (resigned on 29.1.2015)
Lt Gen (rtd) Datuk Khairuddin Bin Mat Yusof (resigned on 17.2.2015)
Na Chiang Seng (resigned on 8.4.2015)

DIRECTORS INTEREST

According to the register of directors shareholdings the interest of directors holding office at the end
of the financial year in shares and warrants in the Company and its related corporations during the
financial year are as follows:-

Number of ordinary shares of RM0.10 each


At At
1.4.2014 Allotment Sold 31.3.2015

Direct interest
Yap Tai Tee 3,400,542 3,400,542
Na Chiang Seng 20,429,400 20,429,400

Number of warrants (2014/2019) of RM0.10 each


At Exercised/ At
1.4.2014 Allotment Sold 31.3.2015

Direct interest
Yap Tai Tee 340,054 340,054
Na Chiang Seng 2,042,940 (2,042,940)

By virtue of his shareholding in the Company, Na Chiang Seng is deemed to have interest in shares of
its related corporations during the financial year to the extent of the Companys interest, in accordance
with Section 6A of the Companies Act 1965.

The other directors holding office at the end of the financial year had no interest in shares in the company
or its related corporations during the financial year.

40
Asdion Berhad
(590812-D)

ANNUAL REPORT 2015

Directors Report (Contd)

DIRECTORS BENEFITS

During and at the end of the financial year, no arrangements subsisted to which the Company is a party,
with the object or objects of enabling Directors of the Company to acquire benefits by means of the
acquisition of shares in or debentures of the Company or any other body corporate.

Since the end of the previous financial year, no Director has received or become entitled to receive any
benefits (other than as disclosed in Notes 28 and 32 to the financial statements) by reason of a contract
made by the Company or a related corporation with the Director or with a firm of which the Director is
a member, or with a company in which the Director has a substantial financial interest.

AUDIT COMMITTEE

The Audit Committee comprises the following members:-

elva Rasan A/L Dato Puspa Das (Chairman/Independent Non-Executive Director)


S
See Poh Yee (Member/Independent Non-Executive Director)
Mohamad Farid Bin Mohd Yusof (Member/Non-Independent Non-Executive Director)

The functions of the Audit Committee are to review accounting policies, internal controls, financial results
and annual financial statements of the Group and of the Company on behalf of the Board of Directors.

In performing its functions, the Audit Committee reviewed the overall scope of external audit. It met up
with the Groups auditors to discuss the results of their examinations and their evaluation of the system
of internal accounting controls of the Group and of the Company. The Audit Committee also reviewed
the assistance given by the Groups and the Companys officers to the auditors.

The Audit Committee reviewed the financial statements of the Group and of the Company as well as
the auditors report thereon and recommended to the Board of Directors, the reappointment of Messrs
SJ Grant Thornton as statutory auditors.

OTHER STATUTORY INFORMATION

Before the Statements of Financial Position and Statements of Profit or Loss and Other Comprehensive
Income of the Group and of the Company were made out, the Directors took reasonable steps:-

(a) to ascertain that action had been taken in relation to the writing off of bad debts and the making
of provision for doubtful debts and satisfied themselves that all known bad debts had been written
off and adequate provision had been made for doubtful debts; and

(b) to ensure that any current assets which were unlikely to be realised in the ordinary course of business
including their values as shown in the accounting records of the Group and of the Company have
been written down to an amount which they might be expected so to realise.

41
Directors Report (Contd)

OTHER STATUTORY INFORMATION (CONTD)

At the date of this report, the Directors are not aware of any circumstances:-

(a) which would render the amounts written off for bad debts or the amount of the provision for doubtful
debts in the financial statements of the Group and of the Company inadequate to any substantial
extent; or

(b) which would render the values attributed to current assets in the financial statements of the Group
and of the Company misleading; or

(c) which have arisen which would render adherence to the existing method of valuation of assets or
liabilities of the Group and of the Company misleading or inappropriate; or

(d) not otherwise dealt with in this report or the financial statements which would render any amount
stated in the financial statements misleading.

At the date of this report, there does not exist:-

(a) any charge on the assets of the Group and of the Company which has arisen since the end of the
financial year which secures the liability of any other person; or

(b) any contingent liability of the Group and of the Company which has arisen since the end of the
financial year.

In the opinion of the Directors:-

(a) no contingent liability or other liability has become enforceable or is likely to become enforceable
within the period of twelve months after the end of the financial year which, in the opinion of the
Directors, will or may affect the ability of the Group and of the Company to meet its obligations as
and when they fall due;

(b) the results of operations of the Group and of the Company during the financial year were not
substantially affected by any item, transaction or event of a material and unusual nature; and

(c) there has not arisen in the interval between the end of the financial year and the date of this report
any item, transaction or event of a material and unusual nature likely to affect substantially the
results of the operations of the Group and of the Company for the current financial year in which
this report is made.

42
Asdion Berhad
(590812-D)

ANNUAL REPORT 2015

Directors Report (Contd)

SIGNIFICANT EVENTS

The significant events during the financial year and after the reporting period are disclosed as Note 37
to the financial statements.

AUDITORS

The Auditors, Messrs SJ Grant Thornton have expressed their willingness to continue in office.

Signed on behalf of the Board of Directors in accordance with a resolution of the Board of Directors.

YAP TAI TEE

DATO MOHAMED RIDZUAN BIN NOR MD

Kuala Lumpur
29 July 2015

43
Statement By Directors

In the opinion of the Directors, the financial statements set out on pages 47 to 127 are drawn up in
accordance with Malaysian Financial Reporting Standards, International Financial Reporting Standards
and the requirements of the Companies Act, 1965 in Malaysia so as to give a true and fair view of the
financial position of the Group and of the Company as at 31 March 2015 and of their financial performance
and cash flows for the financial year then ended.

In the opinion of the Directors, the information set out on page 128 to the financial statements had
been compiled in accordance with the Guidance on Special Matter No.1, Determination of Realised
and Unrealised Profits or Losses in the Context of Disclosure Pursuant to Bursa Malaysia Securities
Berhad Listing Requirements, issued by the Malaysian Institute of Accountants and presented based
on the format prescribed by Bursa Malaysia Securities Berhad.

Signed on behalf of the Board of Directors in accordance with a resolution of the Board of Directors.

YAP TAI TEE DATO MOHAMED RIDZUAN BIN NOR MD


Kuala Lumpur
29 July 2015

Statutory Declaration

I, Yap Tai Tee, being the Director primarily responsible for the financial management of Asdion Berhad,
do solemnly and sincerely declare that to the best of my knowledge and belief, the financial statements
set out on pages 47 to 127 and financial information set out on page 128 are correct and I make this
solemn declaration conscientiously believing the same to be true and by virtue of the provisions of the
Statutory Declarations Act, 1960.

Subscribed and solemnly declared by )


the abovenamed at Kuala Lumpur in )
the Federal Territory this day of )
29 July 2015 )
YAP TAI TEE

Before me:

Commissioner for Oaths


S.Arulsamy (W 490)

44
Asdion Berhad
(590812-D)

ANNUAL REPORT 2015

Independent Auditors Report


To the members of Asdion Berhad
(Incorporated in Malaysia)
(Company No: 590812-D)

Report on the Financial Statements

We have audited the financial statements of Asdion Berhad, which comprise the Statements of Financial
Position as at 31 March 2015 of the Group and of the Company, the Statements of Profit or Loss and
Other Comprehensive Income, Statements of Changes in Equity and Statements of Cash Flows of the
Group and of the Company for the financial year then ended, and a summary of significant accounting
policies and other explanatory notes set out on pages 47 to 127.

Directors Responsibility for the Financial Statements

The Directors of the Company are responsible for the preparation of financial statements so as to give
a true and fair view in accordance with Malaysian Financial Reporting Standards, International Financial
Reporting Standards and the requirements of the Companies Act, 1965 in Malaysia. The Directors are also
responsible for such internal control as the Directors determine is necessary to enable the preparation
of financial statements that are free from material misstatement, whether due to fraud or error.

Auditors Responsibility

Our responsibility is to express an opinion on these financial statements based on our audit. We conducted
our audit in accordance with approved standards on auditing in Malaysia. Those standards require that
we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance
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 our judgement, including the assessment
of risks of material misstatement of the financial statements, whether due to fraud or error. In making
those risk assessments, we consider internal control relevant to the entitys preparation of the 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 entitys
internal control. An audit also includes evaluating the appropriateness of accounting policies used and
the reasonableness of accounting estimates made by the directors, as well as evaluating the overall
presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis
for our audit opinion.

Opinion

In our opinion, the financial statements give a true and fair view of the financial position of the Group and
of the Company as of 31 March 2015 and of their financial performance and cash flows for the financial
year then ended in accordance with Malaysian Financial Reporting Standards, International Financial
Reporting Standards and the requirements of the Companies Act, 1965 in Malaysia.

45
Independent Auditors Report (Contd)

Report on Other Legal and Regulatory Requirements

In accordance with the requirements of the Companies Act, 1965 in Malaysia, we also report the following:-

a) In our opinion, the accounting and other records and the registers required by the Act to be kept
by the Company and its subsidiaries of which we have acted as auditors have been properly kept
in accordance with the provisions of the Act.

b) We have considered the accounts and the auditors reports of all the subsidiaries of which we have
not acted as auditors, which are indicated in Note 5 to the financial statements.

c) We are satisfied that the accounts of the subsidiaries that have been consolidated with the
Companys financial statements are in form and content appropriate and proper for the purposes
of the preparation of the financial statements of the Group and we have received satisfactory
information and explanations required by us for those purposes.

d) The auditors reports on the financial statements of the subsidiaries did not contain any qualification
or any adverse comment made under Section 174 (3) of the Act.

Other Reporting Responsibilities

The supplementary information set out on page 128 is disclosed to meet the requirements of Bursa
Malaysia Securities Berhad and is not part of the financial statements. The Directors are responsible
for the preparation of the supplementary information in accordance with Guidance on Special Matter
No. 1, Determination of Realised and Unrealised Profits or Losses in the Context of Disclosure Pursuant
to Bursa Malaysia Securities Berhad Listing Requirements, as issued by the Malaysian Institute of
Accountants (MIA Guidance) and the directive of Bursa Malaysia Securities Berhad. In our opinion, the
supplementary information is prepared, in all material respects, in accordance with the MIA Guidance
and the directive of Bursa Malaysia Securities Berhad.

Other Matters

This report is made solely to the members of the Company, as a body, in accordance with Section 174
of the Companies Act, 1965 in Malaysia and for no other purpose. We do not assume responsibility to
any other person for the content of this report.

The financial statements of the Company as of 31 March 2014 were audited by another firm of Chartered
Accountants whose report dated 31 July 2014, expressed an unqualified opinion on those financial
statements.

SJ GRANT THORNTON DATO N.K. JASANI


(NO. AF: 0737) (NO: 708/03/16(J/PH))
CHARTERED ACCOUNTANTS CHARTERED ACCOUNTANT

Kuala Lumpur
29 July 2015

46
Asdion Berhad
(590812-D)

ANNUAL REPORT 2015

Statements of Financial Position


For the financial year ended 31 March 2015

Group Company
Note 2015 2014 2015 2014
RM RM RM RM

ASSETS

Non-current assets
Property, plant and equipment 4 5,437,285 14,822,930 716 9,061,797
Investments in subsidiaries 5 7,903,136 1,903,134
Investment in associates 6 36 36
Intangible assets 7 393,247
Development costs 8 8,073 18,837 8,073 18,837
Other investment 9 104,644 31,525
Interest in a joint venture 10 6,000,000 6,000,000
Goodwill 11 5,480,351 33,000

Total non-current assets 17,030,353 15,299,539 13,911,961 10,983,804

Current assets
Inventories 12 240,519 152,140
Trade receivables 13 1,446,184 419,319
Other receivables 14 5,678,262 3,453,296 5,051,199 3,186,575
Amount due from subsidiaries 15 227,523
Tax refundable 6,692 22,803 4,694 4,694
Short-term deposit with
licensed bank 16 7,132
Cash and bank balances 1,867,799 15,540,055 1,484,845 15,463,286

Total current assets 9,239,456 19,594,745 6,768,261 18,654,555

Assets classified as
held-for-sale 17 9,000,834 9,000,834

Total assets 35,270,643 34,894,284 29,681,056 29,638,359

EQUITY AND LIABILITIES


EQUITY
Share capital 18 11,273,460 11,273,460 11,273,460 11,273,460
Reserves 19 12,259,629 15,059,300 11,631,978 13,481,452

Equity attributable to owners


of the Company 23,533,089 26,332,760 22,905,438 24,754,912

Non-controlling interests 979,020 76,230

Total equity 24,512,109 26,408,990 22,905,438 24,754,912

47
Statements of Financial Position (Contd)

Group Company
Note 2015 2014 2015 2014
RM RM RM RM

LIABILITIES

Non-current liabilities
Deferred tax liabilities 20 141,964 265,035 194,003
Finance lease liabilities 21 43,935 90,071
Borrowings 22 1,573,601 3,239,927 1,342,696

Total non-current liabilities 1,759,500 3,595,033 1,536,699

Current liabilities
Trade payables 23 106,422 226,673
Other payables 24 3,650,159 1,245,126 2,405,204 386,657
Amount due to directors 25 3,290,789 2,474,118 106,892 6,575
Amount due to subsidiaries 26 2,810,322 2,720,289
Finance lease liabilities 21 46,708 57,262
Tax payable 164,000 5,772
Borrowings 22 1,546,953 881,310 1,259,197 233,227

Total current liabilities 8,805,031 4,890,261 6,581,615 3,346,748

Liabilities classified
as held-for-sale 17 194,003 194,003

Total liabilities 10,758,534 8,485,294 6,775,618 4,883,447

Total equity and liabilities 35,270,643 34,894,284 29,681,056 29,638,359



The accompanying notes form an integral part of the financial statements.

48
Asdion Berhad
(590812-D)

ANNUAL REPORT 2015

Statements of Profit or Loss and


Other Comprehensive Income
For the financial year ended 31 March 2015

Group Company
Note 2015 2014 2015 2014
RM RM RM RM

Revenue 27 4,323,575 4,369,382

Cost of sales (1,168,874) (2,330,871)

Gross profit 3,154,701 2,038,511

Other income 718,572 83,907 163,938 8,343

Administration expenses (4,881,923) (3,973,460) (1,485,402) (861,858)

Other expenses (802,033) (1,084,650) (71,011) (502,899)

Share of losses in associates (157,186)

Finance costs (563,983) (291,622) (456,999) (161,585)

Loss before taxation 28 (2,374,666) (3,384,500) (1,849,474) (1,517,999)

Tax (expense)/income 29 (224,404) 122,115

Loss after taxation (2,599,070) (3,262,385) (1,849,474) (1,517,999)

Other comprehensive income


- Foreign currency translation (59,516) (39,891)
- Gain on fair value changes of
available-for-sale financial
asset 73,119

Total other comprehensive


income/(loss) for the year 13,603 (39,891)

Total comprehensive loss


for the financial year (2,585,467) (3,302,276) (1,849,474) (1,517,999)

49
Statements of Profit or Loss and Other Comprehensive Income (Contd)

Group Company
Note 2015 2014 2015 2014
RM RM RM RM

Loss after taxation
Attributable to:-

Owners of the Company (2,810,009) (3,097,792) (1,849,474) (1,517,999)
Non-controlling interests 210,939 (164,593)

(2,599,070) (3,262,385) (1,849,474) (1,517,999)

Total comprehensive loss


attributable to:-

Owners of the Company (2,799,671) (3,157,759) (1,849,474) (1,517,999)
Non-controlling interests 214,204 (144,517)

(2,585,467) (3,302,276) (1,849,474) (1,517,999)

Loss per share (sen)


- Basic/Diluted 30 (2.49) (3.98)

The accompanying notes form an integral part of the financial statements.

50
Attributable to owners of the Company
Non-distributable Distributable
Foreign
currency Non
Share Share Warrant translation Capital Revaluation Accumulated controlling Total
Group capital premium reserve reserve reserve reserve losses Sub-total interests equity
RM RM RM RM RM RM RM RM RM RM

Balance at 1 April 2013 6,642,000 7,202,176 186,690 15,429 4,700,273 (9,511,774) 9,234,794 220,747 9,455,541

Contributions by and distribution


to owners of the Company:
- Private placement 3,681,860 8,597,819 4,669,013 16,948,692 16,948,692
- Warrant exercised 949,600 2,753,840 3,703,440 3,703,440
- Share issue expenses (295,371) (101,036) (396,407) (396,407)
For the financial year ended 31 March 2015

Total transactions with owners 4,631,460 11,056,288 4,567,977 20,255,725 20,255,725

Loss after taxation for the


financial year (3,097,792) (3,097,792) (164,593) (3,262,385)

Other comprehensive
(loss)/profit for the
Statements of Changes in Equity

financial year, net after tax:


- foreign currency translation (59,967) (59,967) 20,076 (39,891)

Total comprehensive loss (59,967) (3,097,792) (3,157,759) (144,517) (3,302,276)

Balance at 31 March 2014 11,273,460 18,258,464 4,567,977 126,723 15,429 4,700,273 (12,609,566) 26,332,760 76,230 26,408,990

51
ANNUAL REPORT 2015
(590812-D)
Asdion Berhad
Attributable to owners of the Company

52
Non-distributable Distributable
Foreign Fair
currency value Non
Share Share Warrant translation Capital adjustment Revaluation Accumulated controlling Total
Group capital premium reserve reserve reserve reserve reserve losses Sub-total interests Equity
RM RM RM RM RM RM RM RM RM RM RM

Balance at 1 April 2014 11,273,460 18,258,464 4,567,977 126,723 15,429 4,700,273 (12,609,566) 26,332,760 76,230 26,408,990

Disposal of subsidiaries 157,610 157,610


Acquisition of a subsidiary 530,976 530,976

Other comprehensive
(loss)/profit for the
year, net after tax:
- gains on fair value changes
of available-for-sale financial
Statements of Changes in Equity (Contd)

asset 65,807 65,807 7,312 73,119


- realisation of revaluation reserve (239,978) 239,978
- foreign currency translation (55,469) (55,469) (4,047) (59,516)

Total other comprehensive


(loss)/profit for the year (55,469) 65,807 (239,978) 239,978 10,338 3,265 13,603

(Loss)/Profit after taxation for


the financial year (2,810,009) (2,810,009) 210,939 (2,599,070)

Balance at 31 March 2015 11,273,460 18,258,464 4,567,977 71,254 15,429 65,807 4,460,295 (15,179,597) 23,533,089 979,020 24,512,109

The accompanying notes form an integral part of the financial statements.


Asdion Berhad
(590812-D)

ANNUAL REPORT 2015

Statements of Changes in Equity (Contd)

Non-distributable Distributable
Share Share Warrant Revaluation Accumulated Total
Company capital premium reserve reserve losses equity
RM RM RM RM RM RM

Balance at 1 April 2013 6,642,000 7,202,176 4,044,780 (11,871,770) 6,017,186

Loss for the financial year/


Total comprehensive loss (1,517,999) (1,517,999)

Contribution beyond distributions


to owners of the Company:
- Private placement 3,681,860 8,597,819 4,669,013 16,948,692
- Issuance of shares 949,600 2,753,840 3,703,440
- Shares issue expenses (295,371) (101,036) (396,407)

Total transactions with owners 4,631,460 11,056,288 4,567,977 20,255,725

Balance at 1 April 2014 11,273,460 18,258,464 4,567,977 4,044,780 (13,389,769) 24,754,912

Loss for the financial year/


Total comprehensive loss (1,849,474) (1,849,474)

Balance at 31 March 2015 11,273,460 18,258,464 4,567,977 4,044,780 (15,239,243) 22,905,438

53
Statements of Cash Flows
For the financial year ended 31 March 2015

Group Company
Note 2015 2014 2015 2014
RM RM RM RM

OPERATING ACTIVITIES
Loss before taxation (2,374,666) (3,384,500) (1,849,474) (1,517,999)

Adjustments for:
Amortisation of development
costs 10,764 10,764 10,764 10,764
Bad debts written off 21,192 131,370
Depreciation of property,plant
and equipment 857,209 869,209 60,247 86,944
Impairment loss on:
- investment in subsidiaries 210,000
- intangible assets 393,247
- investment in associates 135,518
- other investment 15,404
- trade receivables 10,747 18,519
- amount due from subsidiaries 182,137
Interest expense 563,983 291,622 456,999 161,585
Inventories written off 61,484
Share of loss in associates 157,186
Gain on disposal of:
- property, plant and equipment (12,670)
- subsidiaries (487,838) (24,000)
Interest income (141,131) (8,581) (139,784) (8,343)
Writeback of impairment loss
on amount due from a subsidiary (41,427)

Operating loss before working


capital changes (1,159,163) (1,702,005) (1,485,248) (916,339)

Changes in working capital:-


Inventories (88,379) (7,940) 12,219
Receivables (3,088,950) (77,631) (1,864,624)
Payables 2,869,751 (2,670,716) 2,018,547 (3,144,307)
Subsidiaries (137,490)
Directors 1,105,234 100,317

Cash used in operations (361,507) (4,458,292) (1,368,498) (4,048,427)

Income tax refunded/(paid) 2,093 (6,099) 2,549

Net cash used in operating activities (359,414) (4,464,391) (1,368,498) (4,045,878)

54
Asdion Berhad
(590812-D)

ANNUAL REPORT 2015

Statements of Cash Flows (Contd)

Group Company
Note 2015 2014 2015 2014
RM RM RM RM

INVESTING ACTIVITIES
Investment in a joint venture (6,000,000) (6,000,000)
Addition of intangible assets (393,247)
Interest received 141,131 8,581 139,784 8,343
Uplifted of deposits pledged
with a licensed bank 7,132 7,819
Acquistion of an associate (36) (36)
Acquisition of subsididaries,
net of cash acquired (5,999,387) (6,000,002)
Disposal of:
- property, plant and equipment 24,854
- subsidiaries, net of proceeds 5 (2,838) 24,000
Purchase of property, plant
and equipment (159,151) (82,955)
Advances to subsidiaries (103,081)

Net cash used in investing


activities (11,988,259) (459,838) (11,836,218) (94,774)

FINANCING ACTIVITIES

Interest expenses (563,983) (291,622) (456,999) (161,585)
Net proceeds from warrant
exercise 3,703,440 3,703,440
Net proceeds from issuance of
shares via private placement 16,552,285 16,552,285
Advances from subsidiaries 60,751
Net increase in bills payable 187,607
Repayment of hire purchase
obligations (49,047) (53,635)
Repayment of term loans (433,998) (414,320) (316,726) (275,207)
Advances from /(Repayment to)
directors 790,189 (279,776)

Net cash (used in)/from financing


activities (1,047,028) 20,473,944 (773,725) 19,599,908

55
Statements of Cash Flows (Contd)

Group Company
Note 2015 2014 2015 2014
RM RM RM RM

CASH AND CASH EQUIVALENTS



Net changes (13,394,701) 15,549,715 (13,978,441) 15,459,256
Exchange differences (168,338) (155,643)
At beginning of the financial year 15,430,838 36,766 15,463,286 4,030

At end of the financial year A 1,867,799 15,430,838 1,484,845 15,463,286

NOTE TO THE STATEMENTS OF CASH FLOWS



A. CASH AND CASH EQUIVALENTS

Cash and cash equivalent included in the statements of cash flows comprise the following:-

Group Company
2015 2014 2015 2014
RM RM RM RM

Bank overdrafts (109,217)


Short term deposits with
licensed banks 7,132
Cash and bank balance 1,867,799 15,540,055 1,484,845 15,463,286

1,867,799 15,437,970 1,484,845 15,463,286


Less: Short term deposits pledged
to licensed banks (7,132)

1,867,799 15,430,838 1,484,845 15,463,286

The accompanying notes form an integral part of the financial statements.

56
Asdion Berhad
(590812-D)

ANNUAL REPORT 2015

Notes to the Financial Statements


31 March 2015

1. GENERAL INFORMATION

The Company is a public limited liability company, incorporated and domiciled in Malaysia and is
listed on ACE Market of Bursa Malaysia Securities Berhad.

The registered office of the Company is located at Plaza 138, Suite 18.03, 18th Floor, 138 Jalan
Ampang, 50450 Kuala Lumpur. The principal place of business of the Company is located at Oval
Tower @ Damansara, Unit 28-8, 28th Floor, No. 685, Jalan Damansara, Taman Tun Dr. Ismail, 60000
Kuala Lumpur.

The Company is principally engaged in the businesses of investment holding, software development,
information communication technology and related services.

The principal activities of the subsidiaries are set out in Note 5 to the financial statements.

There have been no significant changes in the nature of these activities during the financial year.

The financial statements were authorised for issue by the Board of Directors in accordance with
a resolution of the Directors passed on 29 July 2015.

2. BASIS OF PREPARATION

2.1 Statement of Compliance

The financial statements of the Group and of the Company have been prepared in accordance
with Malaysian Financial Reporting Standards (MFRS), International Financial Reporting
Standards (IFRS) and the requirements of the Companies Act, 1965 in Malaysia.

2.2 Basis of Measurement

The financial statements of the Group and the Company are prepared under the historical
cost convention, unless otherwise indicated in the summary of significant accounting policies.

Historical cost is generally based on the fair value of the consideration given in exchange for
goods and services.

Fair value is the price that would be received to sell an asset or paid to transfer a liability in
an orderly transaction between market participants at the measurement date. The fair value
measurement is based on the presumption that the transaction to sell the asset or transfer
the liability takes place either in the principal market for the asset or liability, or in the absence
of a principal market, in the most advantageous market for the asset or liability. The principal
or the most advantageous market must be accessible to by the Group and the Company.

57
Notes to the Financial Statements (Contd)

2. BASIS OF PREPARATION (CONTD)

2.2 Basis of Measurement (Contd)

The fair value of an asset or a liability is measured using the assumptions that market
participants would use when pricing the asset or liability, assuming that market participants
act in their economic best interest.

A fair value measurement of a non-financial market takes into account a market participants
ability to generate economic benefits by using the asset in its highest and best use or by
selling it to another market participant that would use the asset in its highest and best use.

The Group and the Company use valuation techniques that are appropriate in the
circumstances and for which sufficient data are available to measure fair value, maximising
the use of relevant observable inputs and minimising the use of unobservable inputs.

All assets and liabilities for which fair value is measured or disclosed in the financial statements
are categorised within the fair value hierarchy, described as follows, based on the lowest
level input that is significant to their fair value measurement as a whole:

Level 1 - Quoted (adjusted) market prices in active markets for identical assets
Level 2 - Valuation techniques for which the lowest level input that is significant to their
fair value measurement is directly or indirectly observable.
Level 3 - Valuation techniques for which the lowest level input that is significant to their
fair value measurement is unobservable.

For assets and liabilities that are recognised in the financial statements on a recurring basis,
the Group and the Company determine whether transfers have occurred between levels in
the hierarchy by re-assessing categorisation (based on the lowest level input that is significant
to their fair value measurement as a whole) at the end of each reporting period.

2.3 Functional and Presentation Currency

The financial statements are presented in Ringgit Malaysia (RM) which is the Companys
functional currency and all values are rounded to the nearest RM, unless otherwise stated.

2.4 Adoption of New and Revised MFRSs, Amendments/Improvements to MFRSs, and IC


Interpretations (IC Int)

Except for the changes below, the Group and the Company have consistently applied the
accounting policies set out in Note 3 to all periods presented in these financial statements.

In the current financial year, the Group and the Company have applied a number of new and
revised MFRS and amendments to MFRSs that are mandatorily effective for an accounting
period that begins on or after 1 January 2014.

Initial application of the amendments to the standards and IC Int did not have material impact
to the Financial Statements.

58
Asdion Berhad
(590812-D)

ANNUAL REPORT 2015

Notes to the Financial Statements (Contd)

2. BASIS OF PREPARATION (CONTD)

2.4 Adoption of New and Revised MFRSs, Amendments/Improvements to MFRSs, and IC


Interpretations (IC Int) (Contd)

Investment entities (Amendments to MFRS 10, MFRS 12 and MFRS 127

These amendment provide an exception to the consolidation requirement for entities that
meet the definition of an investment entity under MFRS 10 Consolidated Financial Statements
and must be applied retrospectively, subject to certain transition relief. The exception to
consolidation requires investment entities to account for subsidiaries at fair value through
profit or loss.

These amendments have no impact on the Group and the Company, since none of the entities
in the Group and the Company qualifies to be an investment entity under MFRS 12.

Amendments to MFRS 132 offsetting Financial Assets and Financial Liabilities

The Group and the Company have applied the amendments to MFRS 132 Offsetting Financial
Assets and Financial Liabilities for the first time in the current year. The amendments to IAS
32 clarify the requirements relating to the offset of financial assets and financial liabilities.
Specifically, the amendments clarify the meaning of currently has a legally enforceable right
of set-off and simultaneous realisation and settlement.

The amendments have been applied retrospectively. As the Group and the Company do not
have any financial assets and financial liabilities that qualify for offset, the application of the
amendments has had no impact on the disclosures or on the amounts recognised in the
Groups and the Companys financial statements. The Group and the Company have assessed
whether certain of its financial assets and financial liabilities qualify for offset based on the
criteria set out in the amendments and concluded that the application of the amendments
has had no impact on the amounts recognised in the Groups and the Companys financial
statements.

Amendments to MFRS 136 Recoverable Amount Disclosures for Non-Financial Assets

The Group and the Company have applied the amendments to MFRS 136 Recoverable Amount
Disclosures for Non-Financial Assets for the first time in the current year. The amendments to
MFRS 136 remove the requirement to disclose the recoverable amount of a cash-generating
unit (CGU) to which goodwill or other intangible assets with indefinite useful lives had been
allocated when there has been no impairment or reversal of impairment of the related CGU.
Furthermore, the amendments introduce additional disclosure requirements applicable to
when the recoverable amount of an asset or a CGU is measured at fair value less costs
of disposal. These new disclosures include the fair value hierarchy, key assumptions and
valuation techniques used which are in line with the disclosure required by MFRS 13 Fair
Value Measurements.

The application of these amendments has had no material impact on the disclosures in the
Groups and the Companys financial statements.

59
Notes to the Financial Statements (Contd)

2. BASIS OF PREPARATION (CONTD)

2.4 Adoption of New and Revised MFRSs, Amendments/Improvements to MFRSs, and IC


Interpretations (IC Int) (Contd)

Amendments to MFRS 139 Novation of Derivatives and Continuation of Hedge Accounting

The Group and the Company have applied the amendments to MFRS 139 Novation of
Derivatives and Continuation of Hedge Accounting for the first time in the current year.
The amendments to MFRS 139 provide relief from the requirements to discontinue hedge
accounting when a derivate designated as a hedging instrument is novated under certain
circumstances. The amendments also clarify that any change to the fair value of the derivative
designated as a hedging instrument arising from the novation should be included in the
assessment and measurement of hedge effectiveness.

The amendments have been applied retrospectively. As the Group and the Company do
not have any derivatives that are subject to novation, the application of these amendments
has had no impact on the disclosures or on the amounts recognised in the Groups and the
Companys financial statements.

The adoption of new/revised standards does not have material impact on the Groups and
the Companys financial statements.

2.5 Standards Issued But Not Yet Effective

At the date of authorisation of these financial statements, certain new standards, amendments
and interpretations to existing standards have been published by the Malaysian Accounting
Standards Board but are not yet effective, and have not been adopted by the Group and the
Company.

Management anticipates that all of these relevant pronouncements will be adopted in the
Groups and the Companys accounting policies for the first period beginning after the effective
date of the pronouncement. Information on new standards, amendments and interpretations
that are expected to be relevant to the Groups and the Companys financial statements is
provided below. Certain other new standards and interpretations have been issued but are not
expected to have a material impact on the Groups and the Companys financial statements.

MFRS 9 Financial Instruments effective 1 January 2018

MFRS 9 is issued during the financial year, which reflects all phases of the financial instruments
project and replaces MFRS 139 Financial Instruments: Recognition and Measurement and
all previous version of MFRS 9. The new standard introduces extensive requirements and
guidance for classification and measurement of financial assets and financial liabilities which
fall under the scope of MFRS 9, new expected credit loss model under the impairment of
financial assets and greater flexibility has been allowed in hedge accounting transactions.

The adoption of MFRS 9 will result in a change in accounting policy.

The Group and the Company are currently examining the financial impact of adopting MFRS 9.

60
Asdion Berhad
(590812-D)

ANNUAL REPORT 2015

Notes to the Financial Statements (Contd)

2. BASIS OF PREPARATION (CONTD)

2.5 Standards Issued But Not Yet Effective (Contd)

MFRS 15 Revenue from Contracts with Customers effective 1 January 2017

MFRS 15 presents new requirements for the recognition of revenue, replacing the guidance
of MFRS 111 Construction Contracts, MFRS 118 Revenue, IC Int 13 Customer Loyalty
Programmers, IC Int 15 Agreements for Construction of Real Estate, IC Int 18 Transfer of
Assets from Customers and IC Int 131 Revenue Barter Transaction Involving Advertising
Services. The principles in MFRS 15 provide a more structured approach to measuring and
recognising revenue. It establishes a new five-step model that will apply to revenue arising
from contracts with customers. Under MFRS 15 revenue is recognised at an amount that
reflects the consideration to which an entity expects to be entitled in exchange for transferring
goods or services to a customer.

The Group is currently assessing the impact of MFRS 15 and plans to adopt the new standards
on the required effective date.

2.6 Significant Accounting Estimates and Judgements

Estimates, assumptions concerning the future and judgements are made in the preparation
of the financial statements. They affect the application of the Groups and the Companys
accounting policies and reported amounts of assets, liabilities, income and expenses, and
disclosures made. Estimates and underlying assumptions are assessed on an on-going basis
and are based on experience and relevant factors, including expectations of future events
that are believed to be reasonable under the circumstances. The actual result may differ from
the judgements, estimates and assumptions made by management, and will seldom equal
the estimated results.

Information about significant judgements, estimates and assumptions that have the most
significant effect on recognition and measurement of assets, liabilities, income and expenses
are discussed below.

2.6.1 Estimation Uncertainty

The key assumptions concerning the future and other key sources of estimation
uncertainty at the end of the reporting period, that have significant risk of causing a
material adjustment to the carrying amounts of assets and liabilities within the next
financial year are discussed below:-

Useful lives of depreciable assets

Property, plant and equipment are depreciated on a straight line basis over their
estimated useful lives. Management estimates the useful lives of the property, plant
and equipment to be within 3 to 50 years and reviews the useful lives of depreciable
assets at end of each reporting period. At 31 March 2015, management assesses
that the useful lives represent the expected utility of the assets to the Group. The
carrying amounts are analysed in Note 4 to the Financial Statements. Actual results,
however, may vary due to change in the expected level of usage and technological
developments, which may result in the adjustment to the Groups assets.

61
Notes to the Financial Statements (Contd)

2. BASIS OF PREPARATION (CONTD)

2.6 Significant Accounting Estimates and Judgements (Contd)

2.6.1 Estimation Uncertainty (Contd)

Useful lives of depreciable assets (Contd)

A 1% difference in the expected useful lives of the property, plant and equipment
from the management estimates would result in approximately 0.21% variance in
the Groups profit for the financial year.

Impairment of intangible assets

An impairment loss is recognised for the amount by which the assets or cash-
generating units carrying amount exceeds its recoverable amount. To determine the
recoverable amount, management estimates expected future cash flows from each
cash-generating unit and determines a suitable interest rate in order to calculate
the present value of those cash flows. In the process of measuring expected future
cash flows management makes assumptions about future operating results. These
assumptions relate to future events and circumstances. The actual results may vary,
and may cause significant adjustments to the Groups assets within the next financial
year.

In most cases, determining the applicable discount rate involves estimating the
appropriate adjustment to market risk and the appropriate adjustment to asset-specific
risk factors.

Further details of the carrying values, key assumptions applied in the impairment
assessment of intangible assets and the assumptions are disclosed in Notes 11 to
the financial statements.

An 1% increase of the discount rate applied in the impairment test would result in
approximately 4% variance in the Groups impairment tests net present value.

Revaluation of properties

The Groups properties which are reported at valuation are based on valuation
performed by independent professional valuers.

The independent professional valuers have exercised judgement in determined


discount rates, estimates of future cash flows, capitalisation rate, terminal year value,
market rental and other factors used in the valuation process. Also, judgement has
been applied in estimating prices for less readily observable external parameters. Other
factors such as model assumptions, market dislocations and unexpected correlations
can also materially affect these estimates and the resulting valuation estimates.

62
Asdion Berhad
(590812-D)

ANNUAL REPORT 2015

Notes to the Financial Statements (Contd)

2. BASIS OF PREPARATION (CONTD)

2.6 Significant Accounting Estimates and Judgements (Contd)

2.6.2 Significant Management Judgement

The significant management judgements in applying the accounting policies of the


Group that have the most significant effect on the statements are as follows:-

Leases

In applying the classification of leases in MFRS 117, management considers some


of its leasehold properties as finance lease arrangements.

The lease transaction is not always conclusive, and management uses judgement
in determining whether the lease is a finance lease arrangement that transfers
substantially all the risks and rewards incidental to ownership, whether the lease term
is for the major part of the economic life of the asset even if title is not transferred and
others in accordance with MFRS 117 Leases.

3. SIGNIFICANT ACCOUNTING POLICIES

The Group and the Company apply the significant accounting policies, as summarised below,
consistently throughout all periods presented in the financial statements.

3.1 Consolidation

3.1.1 Subsidiaries

Subsidiaries are entities, including structured entities, controlled by the Company.


Control exists when the Group is exposed, or has rights, to variable returns from
its involvement with the entity and has the ability to affect those returns through its
power over the entity. Potential voting rights are considered when assessing control
only when such rights are substantive. Besides, the Group considers it has de facto
power over an investee when, despite not having the majority of voting rights, it has
the current ability to direct the activities of the investee that significantly affect the
investees return.

Investment in subsidiaries is stated at cost less any impairment losses in the Companys
financial position, unless the investment is held for sale or distribution.

Upon the disposal of investment in a subsidiary, the difference between the net disposal
proceeds and its carrying amount is included in profit or loss.

63
Notes to the Financial Statements (Contd)

3. SIGNIFICANT ACCOUNTING POLICIES (CONTD)

3.1 Consolidation (Contd)

3.1.2 Basic of Consolidation

The Group financial statements consolidate the audited financial statements of the
Company and all of its subsidiaries, which have been prepared in accordance with
the Groups accounting policies. Amounts reported in the financial statements of
subsidiaries have been adjusted where necessary to ensure consistency with the
accounting policies adopted by the Group. The financial statements of the Company
and its subsidiaries are all drawn up to the same reporting period.

All intra-group balances, income and expenses and unrealised gains and losses
resulting from intra-group transactions are eliminated in full.

Subsidiaries are consolidated from the date on which control is transferred to the
Group and are no longer consolidated from the date that control ceases.

Changes in the Company owners ownership interest in a subsidiary that do not result
in a loss of control are accounted for as equity transactions. In such circumstances,
the carrying amounts of the controlling and non-controlling interests are adjusted to
reflect the changes in their relative interests in the subsidiary. Any difference between
the amount by which the non-controlling interest is adjusted and the fair value of the
consideration paid or received is recognised directly in equity and attributed to owners
of the parent.

3.1.3 Business Combinations and Goodwill

Business combinations are accounted for using the acquisition method. The cost of an
acquisition is measured as the aggregate of the consideration transferred, measured
at acquisition date fair value and the amount of any non-controlling interest in the
acquiree. For each business combination, the Group elects whether it measures the
non-controlling interest in the acquiree either at fair value or at the proportionate share
of the acquirees identifiable net assets. Acquisition costs incurred are expensed and
included in administrative expenses.

When the Group acquires a business, it assesses the financial assets and liabilities
assumed for appropriate classification and designation in accordance with the
contractual terms, economic circumstances and pertinent conditions as at the
acquisition date. This includes the separation of embedded derivatives in host
contracts by the acquiree.

If the business combination is achieved in stages, the acquisition date fair value of the
acquirers previously held equity interest in the acquiree is remeasured to fair value at
the acquisition date through profit or loss.

64
Asdion Berhad
(590812-D)

ANNUAL REPORT 2015

Notes to the Financial Statements (Contd)

3. SIGNIFICANT ACCOUNTING POLICIES (CONTD)

3.1 Consolidation (Contd)

3.1.3 Business Combinations and Goodwill (Contd)

Any contingent consideration to be transferred by the acquirer will be recognised


at fair value at the acquisition date. Subsequent changes in the fair value of the
contingent consideration which is deemed to be an asset or liability will be recognised
in accordance with MFRS 139 either in profit or loss or as a change to other
comprehensive income. If the contingent consideration is classified as equity, it will
not be remeasured. Subsequent settlement is accounted for within equity. In instances
where the contingent consideration does not fall within the scope of MFRS 139, it is
measured in accordance with the appropriate MFRS.

Goodwill is initially measured at cost, being the excess of the aggregate of the
consideration transferred and the amount recognised for non-controlling interest over
the net identifiable assets acquired and liabilities assumed. If this consideration is
lower than the fair value of the net assets of the subsidiary acquired, the difference
is recognised in profit or loss.

After initial recognition, goodwill is measured at cost less any accumulated impairment
losses. For the purpose of impairment testing, goodwill acquired in a business
combination is, from the acquisition date, allocated to each of the Groups cash-
generating units that are expected to benefit from the combination, irrespective of
whether other assets or liabilities of the acquiree are assigned to those units.

Where goodwill forms part of a cash-generating unit and part of the operation within
that unit is disposed of, the goodwill associated with the operation disposed of is
included in the carrying amount of the operation when determining the gain or loss
on disposal of the operation. Goodwill disposed of in this circumstance is measured
based on the relative values of the operation disposed of and the portion of the cash-
generating unit retained.

3.1.4 Loss of Control

Upon the loss of control of a subsidiary, the Group derecognises the assets and
liabilities of the subsidiary, any non-controlling interests and the other components
of equity related to the subsidiary. Any surplus or deficit arising on the loss of control
is recognised in profit or loss.

If the Group retains any interest in the previous subsidiary, then such interest is
measured at fair value at the date that control is lost. Subsequently it is accounted for
as an equity accounted investee or as an available-for-sale financial asset depending
on the level of influence retained.

65
Notes to the Financial Statements (Contd)

3. SIGNIFICANT ACCOUNTING POLICIES (CONTD)

3.1 Consolidation (Contd)

3.1.5 Non-controlling Interest

Non-controlling interests at the end of the reporting period, being the equity in a
subsidiary not attributable directly or indirectly to the equity holders of the Company,
are presented in the consolidated statement of financial position and statement of
changes in equity within equity, separately from equity attributable to the owners of
the Company. Non-controlling interests in the results of the Group are presented in
the consolidated statement of profit or loss and other comprehensive income as an
allocation of the profit or loss and the comprehensive income for the year between
non-controlling interests and the owners of the Company.

Losses applicable to the non-controlling interests in a subsidiary are allocated to the


non-controlling interests even if that results in a deficit balance.

3.1.6 Associates and Joint Arrangements

Associates are entities in which the Group has significant influence, but no control,
over their financial and operating policies.

A joint venture is a type of joint arrangement whereby the parties have joint control
of the arrangement have rights to the net assets of the joint venture. Joint control is
contractually agreed sharing of control of an arrangement, which exists only when
decisions about the relevant activities require unanimous consent of the parties sharing
control.

The Groups investments in its associates and joint venture are accounted for using
the equity method. Under the equity method, investment in an associate or a joint
venture is carried in the statement of financial position at cost plus post acquisition
changes in the Groups share of net assets of the associate or joint venture since the
acquisition date. Goodwill relating to the associate or joint venture is included in the
carrying amount of the investment and is neither amortised nor individually tested for
impairment.

The share of the result of an associate or a joint venture is reflected in profit or loss.
Any change in other comprehensive income of those investees is presented as part of
the Groups other comprehensive income. In addition, where there has been a change
recognised directly in the equity of an associate or a joint venture, the Group recognises
its share of any changes and discloses this, when applicable, in the statement of
changes in equity. Unrealised gains and losses resulting from transactions between
the Group and the associate or joint venture are eliminated to the extent of the interest
in the associate or joint venture.

The aggregate of the Groups share of profit or loss of an associate and a joint venture
is shown on the face of the statement of profit or loss and other comprehensive income
outside operating profit and represents profit or loss after tax and non-controlling
interests in the subsidiaries of the associate or joint venture.

66
Asdion Berhad
(590812-D)

ANNUAL REPORT 2015

Notes to the Financial Statements (Contd)

3. SIGNIFICANT ACCOUNTING POLICIES (CONTD)

3.1 Consolidation (Contd)

3.1.6 Associates and Joint Arrangements (Contd)

When the Groups share of losses exceeds its interest in an associate or a joint venture,
the carrying amount of that interest including any long-term investment is reduced to
zero, and the recognition of further losses is discontinued except to the extent that
the Group has an obligation or has made payments on behalf of the associate or the
joint venture.

The financial statements of the associates and joint venture are prepared as of the
same reporting period as the Company. Where necessary, adjustments are made to
bring the accounting policies of the associates or joint venture in line with those of
the Group.

After application of the equity method, the Group determines whether it is necessary to
recognise an additional impairment loss on the Groups investments in its associates
or joint venture. The Group determines at each end of the reporting period whether
there is any objective evidence that the investments in the associates or joint venture is
impaired. If there is such evidence, the Group calculates the amount of impairment as
the difference between the recoverable amount of the associates or joint venture and
their carrying value, then recognises the amount in the share of profit of investments
accounted for using the equity method in profit or loss.

Upon loss of significant influence over the associate or joint control over the joint
venture, the Group measures and recognises any retained investment at its fair value.
Any difference between the carrying amount of the associate or joint venture upon
loss of significant influence or joint control and the fair value of the retained investment
and proceeds from disposal is recognised in profit or loss.

When the Groups interest in an associate decreases but does not result in a loss
of significant influence, any retained interest is not re-measured. Any gain or loss
arising from the decrease in interest is recognised in profit or loss. Any gains or
losses previously recognised in other comprehensive income are also reclassified
proportionately to the profit or loss if that gain or loss would be required to be
reclassified to profit or loss on the disposal of the related assets or liabilities.

In the Companys separate financial statements, investments in associates and a joint


venture are stated at cost less impairment losses. On disposal of such investments,
the difference between net disposal proceeds and their carrying amounts is included
in profit or loss.

67
Notes to the Financial Statements (Contd)

3. SIGNIFICANT ACCOUNTING POLICIES (CONTD)

3.2 Foreign currency translation

Foreign currency transactions are translated into the functional currency of the respective
Group entity, using the exchange rates prevailing at the dates of the transactions (spot
exchange rate). Foreign exchange gains and losses resulting from the settlement of such
transactions and from the measurement of monetary items at year-end exchange rates,
whether realised or unrealised, are recognised in profit or loss except for exchange differences
arising from monetary items that form part of the Groups net investment in foreign operations,
which are recognised initially in other comprehensive income and accumulated under foreign
currency translation reserve in equity.

Non-monetary items measured at historical cost are translated using the exchange rates at
the date of the transaction (not retranslated). Non-monetary items measured at fair value are
translated using the exchange rates at the date when fair value was determined. Exchange
differences arising on the translation of non-monetary items carried at fair value are included
in profit or loss for the period except for the differences arising on the translation of non-
monetary items in respect of which gains and losses are recognised directly in equity. Exchange
differences arising from such non-monetary items are also recognised directly in equity.

In the Groups financial statements, all assets, liabilities and transactions of Group entities with
a functional currency other than the RM (the Groups presentation currency) are translated
into RM upon consolidation. The functional currency of the entities in the Group has remained
unchanged during the reporting period.

On consolidation, assets and liabilities have been translated into RM at the closing rate at
end of each reporting period. Income and expenses have been translated into the Groups
presentation currency at the average rate over the reporting period. Exchange differences are
charged or credited to other comprehensive income and recognised in the currency translation
reserve in equity. Goodwill and fair value adjustments arising on the acquisition of a foreign
entity have been treated as assets and liabilities of the foreign entity and translated into RM
at the closing rate.

3.3 Tax expense

Tax expense comprises current and deferred tax. Current tax and deferred tax is recognised in
profit or loss except to the extent that it relates to a business combination or items recognised
directly in equity or other comprehensive income.

3.3.1 Current tax

Current tax is the expected tax payable or receivable on the taxable income or loss for
the year, using tax rates enacted or substantively enacted by the end of the reporting
period, and any adjustment to tax payable in respect of previous years.

Current tax is recognised in the statement of financial position as a liability (or an


asset) to the extent that it is unpaid (or refundable).

68
Asdion Berhad
(590812-D)

ANNUAL REPORT 2015

Notes to the Financial Statements (Contd)

3. SIGNIFICANT ACCOUNTING POLICIES (CONTD)

3.3 Tax expense (Contd)

3.3.2 Deferred tax

Deferred tax is recognised using the liability method, providing for temporary
differences between the carrying amounts of assets and liabilities in the statement of
financial position and their tax bases. Deferred tax is not recognised for the temporary
differences arising from the initial recognition of goodwill, the initial recognition of
assets and liabilities in a transaction that is not a business combination and that
affects neither accounting nor taxable profit or loss. Deferred tax is measured at the
tax rates that are expected to be applied to the temporary differences when they
reverse, based on the laws that have been enacted or substantively enacted by the
end of the reporting period.

The amount of deferred tax recognised is measured based on the expected manner
of realisation or settlement of the carrying amount of the assets and liabilities, using
tax rates enacted or substantively enacted at the reporting date.

Deferred tax assets and liabilities are offset if there is a legally enforceable right to
offset current tax liabilities and assets, and they relate to income taxes levied by the
same tax authority on the same taxable entity, or on different tax entities, but they
intend to settle current tax liabilities and assets on a net basis or their tax assets and
liabilities will be realised simultaneously.

A deferred tax asset is recognised to the extent that it is probable that future taxable
profits will be available against which the temporary difference can be utilised. Deferred
tax assets are reviewed at the end of each reporting period and are reduced to the
extent that it is no longer probable that the related tax benefit will be realised.

3.3.3 Value-added tax

The Groups sale of good in PRC is subjected to value-added tax (VAT) at the
applicable tax rate of 17% for PRC domestic sales. Input VAT on purchases can be
deducted from output VAT.

The net amount of VAT recoverable from, or payable to, the taxation authority is
included as part of other receivables or other payables in the statement of financial
position.

Revenues, expenses and assets are recognised net of the amount of VAT except when
the VAT incurred on the purchase of assets or services is not recoverable from the
taxation authority, in which case the VAT is recognised as part of the cost of acquisition
of the asset or as part of the expense item as applicable.

69
Notes to the Financial Statements (Contd)

3. SIGNIFICANT ACCOUNTING POLICIES (CONTD)

3.4 Property, plant and equipment

Property, plant and equipment are initially stated at cost. The cost of an item of property, plant
and equipment is recognised as an asset if, and only if, it is probable that future economic
benefits associated with the item will flow to the Group and the cost of the item can be
measured reliably.

All property, plant and equipment are subsequently stated at cost less accumulated
depreciation and less any impairment losses. When significant parts of property, plant and
equipment are required to be replaced in intervals, the Group recognises such costs as
individual assets with specific useful lives and depreciation, respectively. All other repair and
maintenance costs are recognised in profit or loss as incurred.

Freehold land is stated at revalued amount less impairment losses and is not depreciated.

Properties are revalued periodically, at least once in every 5 years. Surpluses arising from the
revaluation are recognised in other comprehensive income and accumulated in equity under
the revaluation reserve. Deficits arising from the revaluation, to the extent that they are not
supported by any previous revaluation surpluses, are recognised in profit or loss.

Depreciation is recognised on the straight line method in order to write off the cost of each
asset over its estimated useful life. Freehold land with an infinite life is not depreciated. Other
property, plant and equipment are depreciated based on the estimated useful lives of the
assets as follows:-

Freehold buildings 2%
Renovation 33.3%
Computers 33.3%
Office equipment, furniture and fittings 10% to 20%
Motor vehicles 20%
Machinery 10%
Leasehold properties Over the unexpired lease period

The residual values, useful lives and depreciation method are reviewed for impairment
when events or changes in circumstances indicate that the carrying amounts may not be
recoverable, or at least annually to ensure that the amount, method and period of depreciation
are consistent with previous estimates and the expected pattern of consumption of the future
economic benefits embodied in the items of property, plant and equipment.

Property, plant and equipment are derecognised upon disposal or when no future economic
benefits are expected from its use or disposal. Gains or losses arising on the disposal of
property, plant and equipment are determined as the difference between the disposal proceeds
and the carrying amount of the assets and are recognised in profit or loss.

70
Asdion Berhad
(590812-D)

ANNUAL REPORT 2015

Notes to the Financial Statements (Contd)

3. SIGNIFICANT ACCOUNTING POLICIES (CONTD)

3.5 Intangible assets

Intangible assets acquired separately are measured on initial recognition at cost. Following
initial recognition, intangible assets are carried at cost less accumulated amortisation and
any accumulated impairment loss.

The useful life of intangible assets is assessed to be either finite or indefinite. Intangible assets
with finite life are amortised on straight-line basis over the estimated economic useful life and
assessed for impairment whenever there is an indication that the intangible asset may be
impaired. The amortisation period and the amortisation method for an intangible asset with
a finite useful life are reviewed at least at each financial year end. Changes in the expected
useful life or the expected pattern of consumption of future economic benefits embodied in
the asset is accounted for by charging the amortisation period or method, as appropriate,
and are treated as changes in accounting estimates. The amortisation expense on intangible
assets with finite useful life is recognised in the profit or loss in the expense category consistent
with the function of the intangible asset.

Intangible assets with indefinite useful life are tested for impairment annually or more frequently
if the events or changes in circumstances indicate that the carrying value may be impaired
either individually or at cash-generating unit level. Such intangibles are not amortised. The
useful life of an intangible asset with an indefinite life is reviewed annually to determine whether
the useful life assessment continues to be supportable. If not, the change in useful life from
indefinite to finite is made on a prospective basis.

Gain or losses arising from derecognition of an intangible assets is measured as the difference
between the net disposal proceeds and the carrying amount of the asset and are recognised
in the profit or loss when the asset is derecognised.

3.6 Research and development expenditure

Research expenditure is recognised as an expense when it is incurred.

Development expenditure is recognised as an expense except that costs incurred on


development projects are capitalised as non-current assets to the extent that such expenditure
is expected to generate future economic benefits. Development expenditure is capitalised if,
and only if an entity can demonstrate all of the following:-

(a) its ability to measure reliably the expenditure attributable to the asset under development;
(b) the product or process is technically and commercially feasible;
(c) its future economic benefits are probable;
(d) its intention to complete and the ability to use or sell the developed asset; and
(e) the availability of adequate technical, financial and other resources to complete the
asset under development.

71
Notes to the Financial Statements (Contd)

3. SIGNIFICANT ACCOUNTING POLICIES (CONTD)

3.6 Research and development expenditure (Contd)

Capitalised development expenditure is measured at cost less accumulated amortisation


and impairment losses, if any. Development expenditure initially recognised as an expense
is not recognised as assets in the subsequent period.

The development expenditure is amortised on a straight-line method over a period of 5 years


when the products are ready for sale or use. In the event that the expected future economic
benefits are no longer probable of being recovered, the development expenditure is written
down to its recoverable amount.

3.7 Financial instruments

Initial recognition and measurement

Financial assets and financial liabilities are recognised when the Group and the Company
become a party to the contractual provisions of the financial instrument.

Financial assets and financial liabilities are measured initially at fair value plus transactions
costs, except for financial assets and financial liabilities carried at fair value through profit or
loss, which are measured initially at fair value.

Financial assets and financial liabilities are measured subsequently as described below:-

3.7.1 Financial assets

For the purpose of subsequent measurement, financial assets other than those
designated and effective as hedging instruments are classified into the following
categories upon initial recognition:-

(a) financial assets at fair value through profit or loss;


(b) held to maturity investments;
(c) loans and receivables; and
(d) available-for-sale financial assets.

The category determines subsequent measurement and whether any resulting income
and expense is recognised in profit or loss or in other comprehensive income.

All financial assets except for those at fair value through profit or loss are subject
to review for impairment at least at end of each reporting period. Financial assets
are impaired when there is an objective evidence that a financial asset or a group of
financial assets is impaired. Different criteria to determine impairment are applied for
each category of financial assets.

72
Asdion Berhad
(590812-D)

ANNUAL REPORT 2015

Notes to the Financial Statements (Contd)

3. SIGNIFICANT ACCOUNTING POLICIES (CONTD)

3.7 Financial instruments (Contd)

3.7.1 Financial assets (Contd)

A financial asset or part of it is derecognised when, and only when the contractual rights
to the cash flows from the financial asset expire or the financial asset is transferred
to another party without retaining control or substantially all risks and rewards of the
asset. On derecognition of a financial asset, the difference between the carrying amount
and the sum of the considerate received (including any new asset obtained less any
new liability assume) and any cumulative gain or loss that had been recognised in
equity is recognised in the profit or loss.

As at the reporting date, the Group and the Company carry only loan and receivables
and available-for-sales financial assets on their statements of financial position.

Loans and receivables

Loans and receivables are non-derivative financial assets with fixed or determinable
payments that are not quoted in an active market. After initial recognition, these are
measured at amortised cost using the effective interest method, less allowance for
impairment. Discounting is omitted where the effect of discounting is immaterial.
Gains or losses are recognised in profit or loss when the loans and receivables are
derecognised or impaired, and through the amortisation process. The Groups and
the Companys cash and cash equivalents, amount due from subsidiaries, trade and
other receivables fall into this category of financial instruments.

Loans and receivables are classified as current assets, except for those having maturity
dates later than 12 months after the reporting date which are classified as non-current.

Available-for-sale financial assets



Available-for-sale financial assets are non-derivative financial assets that are either
designated to this category or do not qualify for inclusion in any of the other categories
of financial assets. The Groups and the Companys available-for-sale financial assets
include mainly listed securities.

Available-for-sale financial assets are measured at fair value subsequent to the initial
recognition. Gains and losses are recognised in other comprehensive income and
reported within the available-for-sale reserve within equity, except for impairment
losses and foreign exchange differences on monetary assets, which are recognised
in profit or loss. When the asset is disposed of or is determined to be impaired the
cumulative gain or loss recognised in other comprehensive income is reclassified
from the equity reserve to profit or loss and presented as a reclassification adjustment
within other comprehensive income.

73
Notes to the Financial Statements (Contd)

3. SIGNIFICANT ACCOUNTING POLICIES (CONTD)

3.7 Financial instruments (Contd)

3.7.1 Financial assets (Contd)

Interest calculated using the effective interest method and dividends are recognised
in profit or loss. Dividends on an available-for-sale equity are recognised in profit or
loss when the Group and the Companys right to receive payment is established.

Investment in equity instruments whose fair value cannot be reliably measured are
measured at cost less impairment loss.

Available-for-sale financial assets are classified as non-current assets unless they are
expected to be realised within 12 months after the end of the reporting period.

3.7.2 Financial liabilities

After the initial recognition, financial liability is classified as:-

(a) financial liability at fair value through profit or loss;


(b) other financial liabilities measure at amortised cost using the effective interest
method; and
(c) financial guarantee contracts.

A financial liability or a part of it is derecognised when, and only when, the obligation
specified in the contract is discharged or cancelled or expires. On derecognition of a
financial liability, the difference between the carrying amount of the financial liability
extinguished or transferred to another party and the consideration paid, including any
non-cash assets transferred or liabilities assumed, is recognised in profit or loss.

As at the reporting date, the Group and the Company carry only other financial liabilities
and financial guarantee on their statements of financial position.

Other financial liabilities measured at amortised cost

The Groups and the Companys other financial liabilities include trade payables, other
payables, finance lease liabilities, amount due to directors, amount due to subsidiaries
and borrowings.

Other financial liabilities are subsequently measured at amortised cost using the
effective interest method. Borrowings are classified as current liabilities unless the
Group has an unconditional right to defer settlement of the liability for at least 12
months after the end of the reporting period.

74
Asdion Berhad
(590812-D)

ANNUAL REPORT 2015

Notes to the Financial Statements (Contd)

3. SIGNIFICANT ACCOUNTING POLICIES (CONTD)

3.7 Financial instruments (Contd)

3.7.2 Financial liabilities (Contd)

Financial guarantee contracts

Financial guarantee contracts issued by the Group are those contracts that require a
payment to be made to reimburse the holder for a loss it incurs because the specific
debtor fails to make a payment when due in accordance with the terms of a debt
instrument. Financial guarantee contracts are recognised initially as a liability at fair
value, adjusted for transaction costs that are directly attributable to the issuance of the
guarantee. Subsequently, the liability is measured at the higher of the best estimate
of the expenditure required to settle the present obligation at the reporting date and
the amount recognised less cumulative amortisation.

3.8 Impairment of assets

3.8.1 Non-financial assets

The Group assesses at each reporting date whether there is an indication that an
asset may be impaired. If any indication exists, or when annual impairment testing for
an asset is required, the Group estimates the assets recoverable amount. An assets
recoverable amount is the higher of an assets or cash-generating units (CGU) fair
value less costs to sell and its value in use and is determined for an individual asset,
unless the asset does not generate cash inflows that are largely independent of those
from other assets or groups of assets. Where the carrying amount of an asset or CGU
exceeds its recoverable amount, the asset is considered impaired and is written down
to its recoverable amount. In assessing 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.
In determining fair value less costs to sell, recent market transactions are taken into
account, if available. If no such transactions can be identified, an appropriate valuation
model is used.

Impairment losses of continuing operations, including impairment on inventories,


are recognised in the profit or loss in those expense categories consistent with the
function of the impaired asset.

75
Notes to the Financial Statements (Contd)

3. SIGNIFICANT ACCOUNTING POLICIES (CONTD)

3.8 Impairment of assets (Contd)

3.8.1 Non-financial assets (Contd)

An assessment is made at each reporting date as to whether there is any indication that
previously recognised impairment losses may no longer exist or may have decreased.
If such indication exists, the Group estimates the assets or cash-generating units
recoverable amount. A previously recognised impairment loss is reversed only if there
has been a change in the assumptions used to determine the assets recoverable
amount since the last impairment loss was recognised. The reversal is limited so that
the carrying amount of the asset does not exceed its recoverable amount, nor exceed
the carrying amount that would have been determined, net of depreciation, had no
impairment loss been recognised for asset in prior years.

Goodwill is tested for impairment annually as at the end of each reporting period, and
when circumstances indicate that the carrying value may be impaired. Impairment is
determined for goodwill by assessing the recoverable amount of each cash-generating
unit (or group of cash-generating units) to which the goodwill relates. Where the
recoverable amount of the cash-generating unit is less than their carrying amount,
an impairment loss is recognised. Impairment losses relating to goodwill cannot be
reversed in future periods.

Intangible assets with indefinite useful lives are tested for impairment annually as at
the end of each reporting period, either individually or at the cash-generating unit
level, as appropriate and when circumstances indicate that the carrying value may
be impaired.

3.8.2 Financial assets

The Group assesses at each reporting date whether there is any objective evidence
that a financial asset or a group of financial assets is impaired. A financial asset or a
group of financial assets is deemed to be impaired if, and only if, there is objective
evidence of impairment as a result of one or more events that has occurred after
the initial recognition of the asset (an incurred loss event) and that loss event has
an impact on the estimated future cash flows of the financial asset or the group of
financial assets that can be reliably estimated. Evidence of impairment may include
indications that the debtors or a group of debtors is experiencing significant financial
difficulty, default or delinquency in interest or principal payments, the probability that
they will enter bankruptcy or other financial reorganisation and where observable data
indicates that there is a measurable decrease in the estimated future cash flows, such
as changes in arrears or economic conditions that correlate with defaults.

76
Asdion Berhad
(590812-D)

ANNUAL REPORT 2015

Notes to the Financial Statements (Contd)

3. SIGNIFICANT ACCOUNTING POLICIES (CONTD)

3.8 Impairment of assets (Contd)

3.8.2 Financial assets (Contd)

Financial assets carried at amortised cost

For financial assets carried at amortised cost, the Group first assesses whether
objective evidence of impairment exists individually for financial assets that are
individually significant, or collectively for financial assets that are not individually
significant.

If the Group determines that no objective evidence of impairment exists for an


individually assessed financial asset, whether significant or not, it includes the asset
in a group of financial assets with similar credit risk characteristics and collectively
assesses them for impairment. Assets that are individually assessed for impairment
and for which an impairment loss is, or continue to be, recognised are not included
in a collective assessment of impairment.

If there is objective evidence that an impairment loss has been incurred, the amount
of the loss is measured as the difference between the assets carrying amount and
the present value of estimated future cash flows (excluding future expected credit
losses that have not yet been incurred). The present value of the estimated future
cash flows is discounted at the financial assets original effective interest rate. If a
loan has a variable interest rate, the discount rate for measuring any impairment loss
is the current effective interest rate.

The carrying amount of the asset is reduced through the use of an allowance account
and the amount of the loss is recognised in the profit or loss. Interest income continues
to be accrued on the reduced carrying amount and is accrued using the rate of interest
used to discount the future cash flows for the purpose of measuring the impairment
loss. The interest income is recorded as part of finance income in the profit or loss.
Loans together with the associated allowance are written off when there is no realistic
prospect of future recovery and all collateral has been realised or has been transferred
to the Group. If, in a subsequent year, the amount of the estimated impairment loss
increases or decreases because of an event occurring after the impairment was
recognised, the previously recognised impairment loss is increased or reduced by
adjusting the allowance account. If a future write-off is later recovered, the recovery
is credited to finance costs in the profit or loss.


Available-for-sale financial assets

For available-for-sale financial assets, the Group assesses at each reporting period
whether there is objective evidence that an investment or a group of investment is
impaired.

77
Notes to the Financial Statements (Contd)

3. SIGNIFICANT ACCOUNTING POLICIES (CONTD)

3.8 Impairment of assets (Contd)

3.8.2 Financial assets (Contd)

Available-for-sale financial assets (Contd)

In the case of equity investments classified as available-for-sale, objective evidence


would include a significant or prolonged decline in the fair value of the investment
below its cost. Significant is evaluated against the original cost of the investment
and prolonged against the period in which the fair value has been below its original
cost. Where there is evidence of impairment, the cumulative loss - measured as the
difference between the acquisition cost and the current fair value, less any impairment
loss on that investment previously recognised in the profit or loss - is removed from
other comprehensive income and recognised in the profit or loss. Impairment losses
on equity investments are not reversed through profit or loss; increases in their fair
value after impairments are recognised directly in other comprehensive income.

In the case of debt instruments classified as available-for-sale, impairment is assessed


based on the same criteria as financial assets carried at amortised cost. However, the
amount recorded for impairment is the cumulative loss measured as the difference
between the amortised cost and the current fair value, less any impairment loss on
that investment previously recognised in profit or loss.

Future interest income continues to be accrued based on the reduced carrying


amount of the asset, using the rate of interest used to discount the future cash flows
for the purpose of measuring the impairment loss. The interest income is recorded
as part of finance income. If, in a subsequent year, the fair value of a debt instrument
increases and the increase can be objectively related to an event occurring after the
impairment loss was recognised in the profit or loss, the impairment loss is reversed
through profit or loss.

3.9 Inventories

Inventories are stated at the lower of cost and net realisable value. Cost is determined on
the weighted average basis and comprises the purchase price and incidentals incurred in
bringing the inventories to their present location and condition. Net realisable value represents
the estimated selling price less the estimated costs necessary to make the sale.

Where necessary, due allowance is made for all damaged, obsolete and slow-moving items.
The Group writes down its obsolete or slow moving inventories based on assessment of
the condition and the future demand for the inventories. These inventories are written down
when events or changes in circumstances indicate that the carrying amounts may not be
recovered.

78
Asdion Berhad
(590812-D)

ANNUAL REPORT 2015

Notes to the Financial Statements (Contd)

3. SIGNIFICANT ACCOUNTING POLICIES (CONTD)

3.10 Cash and cash equivalents

Cash and cash equivalents comprise cash on hand, bank balances, short-term demand
deposits, bank overdraft and highly liquid investments which are readily convertible to known
amount of cash and which are subject to insignificant risk of changes in value.

Bank overdrafts are shown in current liabilities in the statements of financial position.

3.11 Borrowing costs

All other borrowing costs are expensed in the period in which they are incurred. Borrowing
costs consist of interest and other costs that the Group and the Company incurred in
connection with the borrowing of funds.

3.12 Leases

The determination of whether an arrangement is, or contains, a lease is based on the substance
of the arrangement at the inception date, whether fulfilment of the arrangement is dependent
on the use of a specific asset or asset or the arrangement conveys a right to use the asset,
even if that right is not explicitly specific in an arrangement.

3.12.1 Finance Lease

Leases in terms of which the Group or the Company assumes substantially all the
risks and rewards of ownership are classified as finance lease. Upon initial recognition,
the leased asset is measured at an amount equal to the lower of its fair value and the
present value of the minimum lease payments.

Minimum lease payments made under finance leases are apportioned between finance
charges and reduction of the lease liability so as to achieve a constant rate of interest
on the remaining balance of the liability.

Finance charges are recognised in finance costs in the profit or loss. Contingent
lease payments are accounted for by revising the minimum lease payments over the
remaining term of the lease when the lease adjustment is confirmed.

A leased asset is depreciated over the useful life of the asset. However, if there is no
reasonable certainty that the Group will obtain ownership by the end of the lease term,
the asset is depreciated over the shorter of the estimated useful life of the asset and
the lease term.

Leasehold land which in substance is a finance lease is classified as a property, plant


and equipment.

79
Notes to the Financial Statements (Contd)

3. SIGNIFICANT ACCOUNTING POLICIES (CONTD)

3.13 Non-current assets held for sale

Non-current assets are classified as held for sale if the carrying amount will be recovered
principally through a sale transaction rather than through continuing use. This condition is
regarded as met only when the sale is highly probable and the asset is available for immediate
sale in its present condition subject only to terms that are usual and customary.

Immediately before classification as held for sale, the measurement of the non-current assets
is brought up-to-date in accordance with applicable MFRSs. Then, on initial classification
as held for sale, non-current assets are measured at the lower of carrying amount and fair
value less costs to sell and are not depreciated. Any differences are recognised in the profit
or loss.

3.14 Revenue recognition

Revenue comprises the fair value of the consideration received or receivable for the sale of
goods and rendering of services in the ordinary course of the Groups activities. Revenue is
recognised net of returns, discounts and value added tax, where applicable.

(a) Sale of Goods

Revenue is recognised when the significant risk and rewards of ownership have been
transferal to the customer and there is no continue management involvement with the
goods, and the amount of revenue can be measured reliably.

(b) Services

Revenue from the services recognised when the services have been rendered and
accepted by customer or on a periodic basis over the term of the term of the maintenance
contract whichever applicable.

(c) Interest Income

Interest income is recognised on an accrual basis, based on the effective yield on the
investment.

3.15 Employee benefits

3.15.1 Short-term employee benefits

Wages, salaries, bonuses and social security contributions are recognised as an


expense in the financial year in which the associated services are rendered by
employees of the Group. Short term accumulating compensated absences such
as paid annual leave are recognised when services are rendered by employees that
increase their entitlement to future compensated absences, and short term non-
accumulating compensated absences such as sick leave are recognised when the
absences occur.

80
Asdion Berhad
(590812-D)

ANNUAL REPORT 2015

Notes to the Financial Statements (Contd)

3. SIGNIFICANT ACCOUNTING POLICIES (CONTD)

3.15 Employee benefits (Contd)

3.15.2 Defined contribution plan

Defined contribution plans are post-employment benefit plans under which the Group
pays fixed contributions into independent entities of funds and will have no legal or
constructive obligation to pay further contribution if any of the funds do not hold
sufficient assets to pay all employee benefits relating to employee services in the
current and preceding financial years.

Such contributions are recognised as an expense in the profit or loss as incurred. As


required by law, companies in Malaysia make such contributions to the Employees
Provident Fund (EPF).

Some of the Groups foreign subsidiaries also make contributions to their respective
countries statutory pension scheme.

3.16 Segment reporting

Operating segments are reported in a manner consistent with the internal reporting provided
to the chief operating decision maker. The chief operating decision maker, who is responsible
for allocating resources and assessing performance of the operating segments, has been
identified to make strategic decisions. Additional disclosure on each of these segments are
shown in Note 36 to the financial statements.

Segment revenues, expenses and result include transfers between segments. The prices
charged on intersegment transactions are the same as those charged for similar goods to
parties outside of the Group in an arms length transaction. These transfers are eliminated
on consolidation.

3.17 Equity and reserves

An equity instrument is any contract that evidences a residual interest in the assets of the Group
and the Company after deducting all of its liabilities. Ordinary shares are equity instruments.
Share capital represents the nominal value of shares that have been issued.

Share premium includes any premiums received on issue of share capital. Any transaction
costs associated with the issuing of shares are deducted from share premium, net of any
related income tax benefits.

Accumulated losses include all current and prior period retained losses.

All transactions with owners of the Company are recorded separately within equity.

81
Notes to the Financial Statements (Contd)

3. SIGNIFICANT ACCOUNTING POLICIES (CONTD)

3.18 Related parties

A related party is a person or entity that is related to the Group. A related party transaction
is a transfer of resources, services or obligations between the Group and its related party,
regardless of whether a price is charged.

(a) a person or a close member of that persons family is related to the Group if that person:

(i) has control or joint control over the Group;


(ii) has significant influence over the Group; or
(iii) is a member of the key management personnel of the ultimate holding company
of the Group, or the Group.

(b) an entity is related to the Group if any of the following conditions applies:

(i) the entity and the Group 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) on 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 benefits of employees of
either the Group or an entity related to the Group.
(vi) the entity is controlled or jointly-controlled by a person identified in (a) above.
(vii) a person identified in (a)(i) above has significant influence over the Group or is a
member of the key management personnel of the ultimate holding company or
the Group.

3.19 Contingencies

Where it is not probable that an inflow or an outflow of economic benefits will be required,
or the amount cannot be estimated reliably, the asset or the obligation is not recognised in
the statements of financial position and is disclosed as a contingent asset or contingent
liability, unless the probability of inflow or outflow of economic benefits is remote. Possible
obligations, whose existence will only be confirmed by the occurrence or non-occurrence of
one or more future events, are also disclosed as contingent assets or contingent liabilities
unless the probability of inflow or outflow of economic benefits is remote.

3.20 Earnings per ordinary share

The Group presents basic and diluted earnings per share data for its ordinary shares (EPS).

Basic EPS is calculated by dividing the profit or loss attributable to ordinary shareholders
of the Company by the weighted average number of ordinary shares outstanding during the
period, adjusted for own shares held.

Diluted EPS is determined by adjusting the profit or loss attributable to ordinary shareholders
and the weighted average number of ordinary shares outstanding, adjusted for own shares
held, for the effects of all dilutive potential ordinary shares, which comprise convertible notes
and share options granted to employee, if any.

82
4. PROPERTY, PLANT AND EQUIPMENT

At Valuation At Cost
Office
equipment,
Freehold Freehold Leasehold Motor furniture and
Group land buildings properties Renovations Computers vehicles Machinery fittings Total
RM RM RM RM RM RM RM RM RM

At Valuation/Cost
At 1 April 2013 5,600,000 3,903,374 3,501,574 466,488 1,913,293 909,780 5,571,779 1,175,599 23,041,887
Additions 18,465 51,266 9,200 4,024 82,955
Written off (39,307) (6,210) (44,050) (89,567)
Translation differences 68 111,760 2,835 29,010 10,715 12,262 12,821 179,471

At 31 March 2014 5,600,000 3,903,442 3,613,334 430,016 1,954,558 971,761 5,593,241 1,148,394 23,214,746
Additions 97,189 7,487 52,161 2,314 159,151
Acquisition of a subsidiary 18,000 120,000 785,000 23,074 946,074
Disposals (34,413) (611,010) (58,092) (84,166) (787,681)
Notes to the Financial Statements (Contd)

Disposals of subsidiaries (761,363) (76,167) (258,751) (198,873) (43,600) (106,591) (1,445,345)


Transferred to assets
held-for-sale (5,600,000) (3,903,442) (9,503,442)
Translation differences 117,700 1,290 3,098 (27,337) (5,853) (2,894) 86,004

At 31 March 2015 2,969,671 435,915 1,095,382 807,459 6,380,949 980,131 12,669,507

83
ANNUAL REPORT 2015
(590812-D)
Asdion Berhad
4. PROPERTY, PLANT AND EQUIPMENT (CONTD)

84
At Valuation At Cost
Office
equipment,
Freehold Freehold Leasehold Motor furniture and
Group (Contd) land buildings properties Renovations Computers vehicles Machinery fittings Total
RM RM RM RM RM RM RM RM RM

Accumulated depreciation
At 1 April 2013 362,459 70,375 305,796 1,849,353 677,027 3,182,683 1,102,152 7,549,845
Charge for the financial year 81,543 69,127 3,085 42,601 74,578 556,691 41,584 869,209
Written off (39,307) (6,210) (44,050) (89,567)
Translation differences 56 1,078 2,835 27,832 6,921 12,008 11,599 62,329

At 31 March 2014 444,058 140,580 272,409 1,913,576 758,526 3,751,382 1,111,285 8,391,816
Charge for the financial year 58,550 70,428 29,454 23,002 78,475 582,266 15,034 857,209
Disposal (34,413) (608,507) (48,411) (84,166) (775,497)
Disposal of subsidiaries (96,707) (76,167) (252,308) (137,935) (41,833) (104,947) (709,897)
Notes to the Financial Statements (Contd)

Transferred to assets
held-for-sale (502,608) (502,608)
Translation differences 4,486 2,167 2,885 (30,103) (4,622) (3,614) (28,801)

At 31 March 2015 118,787 193,450 1,078,648 620,552 4,287,193 933,592 7,232,222

Net carrying amount
At 31 March 2015 2,850,884 242,465 16,734 186,907 2,093,756 46,539 5,437,285

At 31 March 2014 5,600,000 3,459,384 3,472,754 157,607 40,982 213,235 1,841,859 37,109 14,822,930
4. PROPERTY, PLANT AND EQUIPMENT (CONTD)

At Valuation At Cost

Office
equipment,
Freehold Freehold Motor furniture and
Company land buildings Renovations Computers vehicles fittings Total
RM RM RM RM RM RM RM

At Valuation/Cost
At 1 April 2013/31 March 2014 5,600,000 3,903,442 121,043 629,477 335,350 661,287 11,250,599
Transferred to assets held-for-sale (5,600,000) (3,903,442) (9,503,442)

At 31 March 2015 121,043 629,477 335,350 661,287 1,747,157



Accumulated depreciation
At 1 April 2013 365,989 121,043 628,223 335,350 651,253 2,101,858
Charge for the financial year 78,068 707 8,169 86,944
Notes to the Financial Statements (Contd)


At 31 March 2014 444,057 121,043 628,930 335,350 659,422 2,188,802
Charge for the financial year 58,551 529 1,167 60,247
Transferred to assets held-for-sale (502,608) - (502,608)

At 31 March 2015 121,043 629,459 335,350 660,589 1,746,441

Nett carrying amount
At 31 March 2015 18 698 716

At 31 March 2014 5,600,000 3,459,385 547 1,865 9,061,797

85
ANNUAL REPORT 2015
(590812-D)
Asdion Berhad
Notes to the Financial Statements (Contd)

4. PROPERTY, PLANT AND EQUIPMENT (CONTD)

At the end of the reporting period, the plant and equipment acquired under finance lease
arrangement are as follows:-

Group
2015 2014
RM RM

At net carrying value:


Motor vehicle 70,908 129,294
Office equipment 17,994 23,970

88,902 153,264

The property was revalued based on a valuation carried out by an independent firm of professional
valuers using the comparison method during the financial year ended 31 March 2013.

The surpluses arising from the above revaluation net of deferred tax liabilities have been credited
to the other comprehensive income and accumulated in equity under the revaluation reserve.

Included in the property, plant and equipment of the Group are motor vehicles and plant and
machinery with net carrying amount of RM116,000 and RM758,833 respectively held in trust by a
third party.

Had the revalued properties been carried at cost less accumulated depreciation, the net book
values of the properties that would have been included in the financial statements are as follows:-

Group Company
2015 2014 2015 2014
RM RM RM RM

At net carrying value:



Freehold land 2,137,230 2,137,230
Freehold buildings 2,839,023 2,683,371
Leasehold properties 2,254,841 2,550,348

2,254,841 7,526,601 4,820,601


As at the end of the reporting period, the leasehold properties of the Group with carrying value of
RM2,850,884 (2014: RM3,472,754) have been pledged to licensed banks as security for banking
facilities granted to the Group.

The fair value of the freehold land, freehold building and leasehold properties are carried at fair value
level 3. The level 3 fair values have been determined based on the sales comparison approach
that reflects recent transaction prices for similar properties to reflect market value of existing use.

86
Asdion Berhad
(590812-D)

ANNUAL REPORT 2015

Notes to the Financial Statements (Contd)

5. INVESTMENTS IN SUBSIDIARIES

Company
2015 2014
RM RM

Unquoted shares, at cost


- in Malaysia 6,600,002 2,190,004
- outside Malaysia 1,453,134 1,453,134

8,053,136 3,643,138
Accumulated impairment losses (150,000) (1,740,004)

7,903,136 1,903,134

Quasi loan

At 1 April 210,000 210,000


Impairment loss for the financial year (210,000) (210,000)

At 31 March

7,903,136 1,903,134

The details of the subsidiaries are as follows:-

Name of Companies Country of Effective


Incorporation Equity Interest Principal Activities
2015 2014
% %

Direct Subsidiaries

Asdion Digital Advance Malaysia 90 90 Investment holding


System Sdn. Bhd.
(ADAS)

Asdion International Malaysia 80 Investment holding


Sdn. Bhd. (AI)

Asdion Media Sdn. Bhd. Malaysia 100 Investment holding


(AMS)

Asdion Project Synergy Malaysia 100 100 Dormant


Sdn. Bhd.

87
Notes to the Financial Statements (Contd)

5. INVESTMENTS IN SUBSIDIARIES (CONTD)

Name of Companies Country of Effective


Incorporation Equity Interest Principal Activities
2015 2014
% %

Direct Subsidiaries

108 Talent Sdn. Bhd. Malaysia 100 100 Dormant

Techtron Integrated Republic of 100 100 Software development,


Systems (S) Pte Ltd (TIS)* Singapore information
communication
technology and
related services

TAZ Logistics Sdn. Bhd. Malaysia 51 Dry bulk cargo


(TAZ) stevedoring related
services

Venice Sanctuary Malaysia 100 Dormant


Sdn. Bhd.

Subsidiaries of TIS

Asdion Data Services Malaysia 100 100 Advisers on solutions


Sdn. Bhd. relating to information
technology.

Asdion (B) Sdn. Bhd. *^ Brunei 60 Dormant.


Darussalam

Asdion Digital Instruments The Republic of 60 Dormant.
Pte Ltd (ADI)*# Singapore

Asdion Hospitality Solutions Malaysia 100 100 Advisers on solutions
Sdn. Bhd. relating to information
technology.

Asdion Software Pte Ltd The Republic of 97 97 Investment holding.


(ASPL)* Singapore

88
Asdion Berhad
(590812-D)

ANNUAL REPORT 2015

Notes to the Financial Statements (Contd)

5. INVESTMENTS IN SUBSIDIARIES (CONTD)

Name of Companies Country of Effective


Incorporation Equity Interest Principal Activities
2015 2014
% %


Subsidiaries of ASPL

Asdion Software The Peoples 97 97 Dormant.
(Shanghai) Co Ltd* Republic of China

Asdion Exim (Shanghai) The Peoples 97 97 General traders
Co Ltd* Republic of China including imports
and exports.

Subsidiaries of AMS

Quipmart Sdn. Bhd. Malaysia 100 Business of traders
(QSB) in audio video
equipment and
accessories

108 Media Holdings Malaysia 50 Advertising production


Sdn. Bhd. (108 MH) house.

Subsidiary of QSB

Hotscreen Sdn. Bhd. Malaysia 100 Advertising production
house.

* Subsidiaries not audited by SJ Grant Thornton

# In previous financial year, TIS, the holding company of ADI, applied to strike off ADI from the
Accounting and Corporate Regulatory Authority of Singapore. The strike-off was completed
during the financial year and it does not have a material financial impact on the Group.

^ During the financial year, Asdion (B) Sdn. Bhd., incorporated in Brunei Darussalam a direct
subsidiary of TIS, had been voluntary winding-up on 9 June 2014. The voluntary winding-up
has been completed on 9 September 2014 and the Company has been dissolved.

(a) Quasi loan represents advances and payments made on behalf of which the settlement is
neither planned nor likely to occur in the foreseeable future. This amount is, in substance,
a part of the Companys net investment in the subsidiaries. The quasi loan is stated at cost
less accumulated impairment losses, if any.

89
Notes to the Financial Statements (Contd)

5. INVESTMENTS IN SUBSIDIARIES (CONTD)

Disposal of subsidiaries

On 30 March 2015, the Company disposed 100% of its equity interest in Asdion Media Sdn. Bhd.
for cash consideration of RM14,000.

The disposal of Asdion Media Sdn. Bhd. gave rise to a gain of RM494,014 in the Groups financial
statements.

On 24 March 2015, the Company disposed of its entire shareholding in Asdion International Sdn.
Bhd. (AI) representing 80% equity interest in AI for cash consideration of RM10,000.

The disposal of Asdion International Sdn. Bhd. gave rise to a loss of RM6,176 in the Groups
financial statements.

The value of assets and liabilities of Asdion Media Sdn. Bhd. and Asdion International Sdn. Bhd.
recorded in the consolidated financial statements as at 31 March 2015 and the cash flow effects
of the disposal was as follows:-

RM

Property, plant and equipment 735,448


Other receivables 5,600
Tax recoverables 15,842
Cash and bank balances 26,838
Trade and other payables (652,976)
Amount due to a director (288,563)
Finance lease liabilities (7,643)
Borrowings (457,468)
Non-controlling interest 159,084

Fair value of net liabilities disposed (463,838)


Gain on disposal 487,838
Consideration received, satisfied in cash 24,000
Less: Cash and cash equivalents balances disposed (26,838)

Net cash outflows from disposal (2,838)




Acquisition of subsidiaries

On 26 August 2014, the Company incorporated a wholly-owned subsidiary of Venice Sanctuary


Sdn. Bhd. with cash subscription of RM2.

On 6 February 2015, the Company acquired 51% equity interest in TAZ Logistics Sdn. Bhd. for a
total consideration of RM6,000,000.

90
Asdion Berhad
(590812-D)

ANNUAL REPORT 2015

Notes to the Financial Statements (Contd)

5. INVESTMENTS IN SUBSIDIARIES (CONTD)

The fair value of the assets and liabilities acquired and the goodwill arising are as follows:-

Group
At date of
acquisition
2015
RM

Property, plant and equipment 946,074


Trade and other receivables 200,420
Cash and bank balances 613
Other payables (63,482)

Net asset acquired 1,083,625


Non-controlling interest (530,976)

Subtotal 552,649
Goodwill on consolidation 5,447,351

Total consideration paid 6,000,000


Cash and cash equivalent (613)

Net cash outflow arising on acquisition 5,999,387

The acquisition of new subsidiaries reduced the Groups loss after tax for the financial year between
the date of acquisition and the reporting date by RM321,430.

Non-controlling interest in subsidiaries

The Groups subsidiaries that have material non-controlling interest (NCI) are as follows:-

2015 TAZ ADAS Others Total


RM RM RM RM

Effective interest equity (%) 49% 10%


Carrying amount of NCI 839,801 219,104 (79,885) 979,020
Profit/(Loss) allocated to NCI 308,825 (662) (97,224) 210,939

91
Notes to the Financial Statements (Contd)

5. INVESTMENTS IN SUBSIDIARIES (CONTD)

Non-controlling interest in subsidiaries (Contd)

The Groups subsidiaries that have material non-controlling interest (NCI) are as follows (Contd):-

2014 AI ADAS Others Total


RM RM RM RM

Effective interest equity (%) 20% 10%


Carrying amount of NCI (106,186) 212,454 (30,038) 76,230
Loss allocated to NCI (92,058) (72,535) (164,593)


TAZ ADAS Total
RM RM RM

2015

At 31 March
Non-current assets 914,538 104,644 1,019,182
Current assets 1,349,273 2,096,012 3,445,285
Non-current liabilities (481,931) (9,606) (491,537)
Current liabilities (68,000) (68,000)

Net assets 1,713,880 2,191,050 3,904,930

Financial year ended 31 March


Revenue 1,905,171 1,905,171

Profit/(Loss) for the financial year 713,880 (6,617) 707,263


Other comprehensive income 73,119 73,119

Total comprehensive income 713,880 66,502 780,382


Net cash flows from operating activities 148,349 38,035 186,384


Net cash flows (for)/from investing activities (946,074) (31,123) (977,197)
Net cash flows from/(for) financing activities 900,000 900,000

92
Asdion Berhad
(590812-D)

ANNUAL REPORT 2015

Notes to the Financial Statements (Contd)

5. INVESTMENTS IN SUBSIDIARIES (CONTD)

Non-controlling interest in subsidiaries (contd)

The Groups subsidiaries that have material non-controlling interest (NCI) are as follows (contd):

AI ADAS Total
RM RM RM

2014

At 31 March
Non-current assets 32,866 31,525 64,391
Current assets 107,934 2,105,077 2,213,011
Current liabilities (671,766) (12,054) (683,820)

Net (liabilities)/assets (530,966) 2,124,548 1,593,582

Financial year ended 31 March


Loss for the financial year/
Total comprehensive expenses
for the financial year (517,724) (920,575) (1,438,299)

Net cash flows (for)/from operating


activities (4,547) 6,108 1,561
Net cash flows (for)/from investing
activities (14,187) 19,834 5,647
Net cash flows from/(for) financing
activities 17,421 (26,156) (8,735)

6. INVESTMENT IN ASSOCIATES

Group Company
2015 2014 2015 2014
RM RM RM RM

Unquoted shares in Malaysia,


at cost 500,036 500,036 36 36
Share of post-acquisition losses (364,518) (364,518)

135,518 135,518 36 36
Less: Impairment loss (135,518) (135,518)

36 36

93
Notes to the Financial Statements (Contd)

6. INVESTMENT IN ASSOCIATES (CONTD)

The details of the associates are as follows:-

Name of Companies Country of Effective


Incorporation Equity Interest Principal Activities
2015 2014
% %

Sun Rock Development


Sdn Bhd (SRD) Malaysia 36 36 Property development

SH2 Plantations Sdn Bhd
(SH2) Malaysia 25.50 Agricultural activities

On 19 August 2013, the Company acquired 4 ordinary shares of RM1 each representing 100%
of the total issued and paid-up share capital of SRD for a total cash consideration of RM4. On 30
August 2013, the Company subscribed for the additional 96 new ordinary shares of RM1 each
issued by SRD.

On 30 August 2013, the Company entered into a Share Sale Agreement with Protasco Development
Sdn. Bhd. (PDSB) to dispose of 64 ordinary shares of RM 1 each in SRD to PDSB for a total cash
consideration of RM64. Following the completion of the partial disposal of SRD, the Company
diluted its equity interest to 36% in SRD.

The summarised unaudited financial information of SRD and SH2 to the Group is as follows:-

SRD
2015 2014
RM RM

At 31 March

Non-current assets 29,654,424 28,691,624
Current assets 211,417 48,744
Current liabilities (30,468,454) (29,138,593)

Net liabilities (602,613) (398,225)

For the financial year ended 31 March



Loss for the financial year/Total comprehensive
expenses for the financial year (1,204,278) (351,584)

Groups share of loss for the financial year/


other comprehensive expenses for the financial year (36)

94
Asdion Berhad
(590812-D)

ANNUAL REPORT 2015

Notes to the Financial Statements (Contd)

6. INVESTMENT IN ASSOCIATES (CONTD)

The details of the associates are as follows (Contd):-

SH2
2014
RM

At 31 March
Non-current assets 267,712
Current assets 20,755
Current liabilities (930,782)

Net liabilities (642,315)

For the financial year ended 31 March


Loss for the financial year/Total comprehensive
expenses for the financial year (616,274)

Groups share of loss for the financial year/


other comprehensive expenses for the financial year (157,150)


The Group has not recognised losses related to SRD and SH2, totaling RM548,606 in 2015
(2014:RM126,534) and cumulatively RM675,140 in 2015 (2014:RM126,534), since the Group has
no obligation in respect of these losses.

On 30 March 2015, the investment in SH2 was disposed through the disposal of its equity interest
in Asdion International Sdn. Bhd..

7. INTANGIBLE ASSETS

Group
2015 2014
RM RM

Programmes and film rights 393,247 393,247


Less: Impairment (393,247)

393,247

Intangible assets comprise programmes and film rights produced by a subsidiary pending for
commercial sales.

The impairment loss is recognised as a result of the carrying amount exceeded its recoverable
amount.

95
Notes to the Financial Statements (Contd)

8. DEVELOPMENT COSTS

Group/Company
2015 2014
RM RM

At cost:

At 1 April 3,542,746 3,542,746
Accumulated amortisation (2,275,965) (2,265,201)
Accumulated impairment losses (1,258,708) (1,258,708)

At 31 March 8,073 18,837

Accumulated amortisation
At 1 April (2,265,201) (2,254,437)
Amortisation for the financial year (10,764) (10,764)

At 31 March (2,275,965) (2,265,201)

9. OTHER INVESTMENT

Group
2015 2014
RM RM

Quoted shares outside Malaysia, at fair value


At 1 April 31,525 46,929
Fair value adjustment 73,119
Impairment loss during the financial year (15,404)

At 31 March 104,644 31,525

Investments in quoted shares of the Group are designated as available-for-sale financial assets
and are measured at fair value.

96
Asdion Berhad
(590812-D)

ANNUAL REPORT 2015

Notes to the Financial Statements (Contd)

10. INTEREST IN A JOINT VENTURE

Group/
Company
2015
RM

At cost: Investment in a joint venture project 6,000,000

The Company has entered a 80:20 joint venture project with a Malaysia incorporated entity, Top
Valley Properties Sdn. Bhd.. The joint venture project involves a 3-year mix property development
project. The principal place of business is located at PM8688, Lot 104160 (formerly known as H.S
(M) 15921 PT32378), Mukim Dengkil, Kg. Limau Manis, Daerah Sepang, Negeri Selangor. There is
no joint venture account available as at the reporting date as the joint venture agreement was just
entered at the year end.

11. GOODWILL

Group
2015 2014
RM RM

At 1 April 33,000 33,000


Addition (Note 5) 5,447,351

At 31 March 5,480,351 33,000


The recoverable amount of the cash generating unit (CGU) is determined based on value in use
calculation using cash flow projections based on financial budgets approved by the management
covering a five-year period. The key assumptions used for value in use calculation are 51% for gross
profit margin, 3% for growth rate and 11.54% for discount rate. With regards to the assessments
of value-in-use of these CGU, management believes that no reasonably possible changes in any
of the key assumptions would cause the carrying values of these units to differ materially from
their recoverable amounts except for the changes in prevailing operating environment which is not
ascertainable.

The goodwill on consolidation mainly relates to the Logistic segment. The Group reviews goodwill
for impairment annually in accordance with its accounting policy.

97
Notes to the Financial Statements (Contd)

12. INVENTORIES

Group
2015 2014
RM RM

At cost:-

Raw materials 231,737 68,124
Finished goods 8,782 84,016

240,519 152,140

Recognised in profit or loss


Inventories recognised as cost of sales 564,645 1,469,821
Inventories written off 61,484

None of the inventories is carried at net realisable value.

13. TRADE RECEIVABLES

Group
2015 2014
RM RM

Trade receivables 1,450,884 439,228


Impairment losses (4,700) (19,909)

At 31 March 1,446,184 419,319

Impairment losses
At 1 April (19,909) (130,335)
Addition during the financial year (10,747) (18,519)
Written off during the financial year 21,192 131,370
Translation differences 4,764 (2,425)

At 31 March (4,700) (19,909)

The Groups normal trade credit terms range from 30 to 60 (2014: 30 to 60) days.

The impairment loss on trade receivable was due to the financial difficulty faced by the debtors.

98
Asdion Berhad
(590812-D)

ANNUAL REPORT 2015

Notes to the Financial Statements (Contd)

14. OTHER RECEIVABLES

Group Company
2015 2014 2015 2014
RM RM RM RM

Other receivables 5,197,135 3,195,254 4,973,909 3,093,848


Deposits 218,976 40,995 32,716 21,680
Prepayments 262,151 217,047 44,574 71,047

5,678,262 3,453,296 5,051,199 3,186,575

Included in other receivables of the Group and the Company is an amount owing by an associate
amounting to RM4,868,444 (2014: RM3,130,459) and RM4,868,444 (2014: 3,093,783) respectively.
The amount due from associate is non-trade in nature, unsecured, interest-free and repayable on
demand.

15. AMOUNT DUE FROM SUBSIDIARIES

Company
2015 2014
RM RM

Amount owing by:-



Non-trade balances 1,323,366 1,095,843
Impairment losses (1,095,843) (1,095,843)

At 31 March 227,523

Impairment losses
At 1 April (1,095,843) (955,133)
Addition (182,137)
Writeback during the financial year 41,427

At 31 March (1,095,843) (1,095,843)

The amount due from subsidiaries are non-trade in nature, unsecured, interest-free and repayable
on demand.

16. SHORT-TERM DEPOSITS WITH LICENSED BANKS

The short-term deposits are placed with licensed banks. The interest earned from rate at 3.05%
(2014: 3.05%) per annum with maturity periods ranging from 30 to 90 (2014: 30 to 365) days.

The short-term deposits with licensed banks were pledged to a licensed bank as security for
banking facilities granted to the Group.

99
Notes to the Financial Statements (Contd)

17. ASSETS CLASSIFIED AS HELD-FOR-SALE



Group/Company
2015
RM

Assets classified as held-for-sale


Property, plant and equipment 9,000,834
Liabilities classified as held-for-sale
Deferred tax liabilities (194,003)

At 31 March 8,806,831


On 1 December 2014, an agreement is made with the contracted party to dispose the freehold
land and building. The non-current assets held for sale with a carrying amount of RM9,000,834
were disposed at RM9,200,000, at a price higher than its net carrying amount. The disposed was
completed on 19 May 2015.

The assets are pledged as securities for bank borrowings.

18. SHARE CAPITAL



Company
2015 2014 2015 2014
Number of ordinary shares
of RM0.10 each RM RM

Authorised:

At 1 April 500,000,000 100,000,000 50,000,000 10,000,000
Created during the
financial year 400,000,000 40,000,000

At 31 March 500,000,000 500,000,000 50,000,000 50,000,000

Issued and fully paid-up:-


At 1 April 112,734,600 66,420,000 11,273,460 6,642,000
Issued during the financial year 46,314,600 4,631,460

At 31 March 112,734,600 112,734,600 11,273,460 11,273,460

100
Asdion Berhad
(590812-D)

ANNUAL REPORT 2015

Notes to the Financial Statements (Contd)

18. SHARE CAPITAL (CONTD)

In previous financial year,

(a) the authorised capital of the Company was increased from RM10,000,000 to RM50,000,000
by the creation of an additional 400,000,000 new ordinary shares of RM0.10 each; and

(b) the Company increased its issued and paid-up share capital from RM6,642,000 to
RM11,273,460 by:-

(i) issuance of 9,496,000 new ordinary shares of RM0.10 each at an issue price of RM0.39
per share at par pursuant to warrants 2008/2013;

(ii) issuance of 7,591,600 new ordinary shares of RM0.10 each at an issue price of RM0.40
per share by way of private placement; and

(iii) private placement of 29,227,000 new ordinary shares of RM0.10 each at an issue price
of RM0.476 per share by way of private placement.

The new shares were issued for cash consideration. The new shares issued rank pari passu
in all respects with the existing shares of the Company.

19. RESERVES

Group Company
2015 2014 2015 2014
RM RM RM RM

Share premium (a) 18,258,464 18,258,464 18,258,464 18,258,464


Warrant reserve (b) 4,567,977 4,567,977 4,567,977 4,567,977
Foreign exchange
translation reserve (c) 71,254 126,723
Capital reserve (d) 15,429 15,429
Fair value adjustment
reserve (e) 65,807
Revaluation reserve (f) 4,460,295 4,700,273 4,044,780 4,044,780
Accumulated losses (15,179,597) (12,609,566) (15,239,243) (13,389,769)

12,259,629 15,059,300 11,631,978 13,481,452

101
Notes to the Financial Statements (Contd)

19. RESERVES (CONTD)

(a) Share Premium

The share premium is not distributable by way of dividends and may be utilised in the manner
set out in Section 60(3) of the Companies Act 1965.

(b) Warrant reserve

The movements in the warrant reserve of the Group and of the Company are as follows:-

2015 2014
RM RM

Capitalisation of subscription from private placement 4,567,977 4,567,977

The warrant reserve arose from the allocation of proceeds received for private placement by
reference to the fair value of the warrants, amounting to RM0.1065 per warrant and net of
share issuance costs incurred in relation to the private placement exercise.

(c) Foreign exchange translation reserve

Group
2015 2014
RM RM

At 1 April 126,723 186,690


Foreign exchange translation during the financial year (55,469) (59,967)

At 31 March 71,254 126,723


The foreign exchange translation reserve arose from the translation of the financial statements
of foreign operations whose functional currencies are different from that of the Companys
presentation currency and is not distributable by way of dividends.

(d) Capital reserve

The capital reserve arose from the Groups proportionate share of capital reserve of the
associate and is not distributable by way of dividends.

(e) Fair value adjustment reserve

The fair value adjustment reserve represents surplus arising from the revaluation of quoted
share investment as disclosed in Note 9 to the financial statements. This reserve is not
distributable as cash dividends.

(f) Revaluation reserve

The revaluation reserve represents surpluses arising from the revaluation of properties as
disclosed in Note 4 to the financial statements. This reserve is not distributable as cash
dividends.

102
Asdion Berhad
(590812-D)

ANNUAL REPORT 2015

Notes to the Financial Statements (Contd)

20. DEFFERED TAX LIABILITIES



Group Company
2015 2014 2015 2014
RM RM RM RM

Deferred tax liabilities


At 1 April (265,035) (431,238) (194,003) (194,003)
Recognition in profit or loss
(Note 29) (68,000) 111,092
Reclassified as held-for-sale 194,003 194,003
Translation differences (2,932) 55,111

(141,964) (265,035) (194,003)

The components of the deferred tax asset and (liabilities) are as follows:-

Group Company
2015 2014 2015 2014
RM RM RM RM

Accelerated capital allowances


on qualifying cost of property,
plant and equipment (68,000) (456,665)
Revaluation surplus (73,964) (295,370) (194,003)
Unabsorbed capital
allowances and unutilized tax loses 487,000

(141,964) (265,035) (194,003)

At the end of the reporting period, no deferred tax assets are recognised by the Group and the
Company in respect of the following items as it is not probable that future taxable profits of the
Group and the Company will be available for utilisation against the deductible temporary differences.

Group Company
2015 2014 2015 2014
RM RM RM RM

Unabsorbed capital
allowance and unutilised
tax losses 11,219,326 10,771,000 9,018,341 8,643,700
Accelerated depreciation
over capital allowances on
qualifying cost of assets (213,000) (296,000) (155,000) (205,000)

11,006,326 10,475,000 8,863,341 8,438,700

103
Notes to the Financial Statements (Contd)

21. FINANCE LEASE LIABILITIES

Group
2015 2014
RM RM

Minimum finance lease liabilities payments:


- not later than one year 49,518 64,497
- later than one year and not later than two years 45,107 53,231
- later than one year and not later than five years 41,009

94,625 158,737
Less: Future finance charges (3,982) (11,404)

Present value of finance lease liabilities 90,643 147,333

The finance lease liabilities are repayable as follows:-

Group
2015 2014
RM RM

Current:
- not later than one year 46,708 57,262

Non-current:
- later than one year and not later than two years 43,935 52,443
- later than one year and not later than five years 37,628

43,935 90,071

90,643 147,333

The finance lease liabilities bear interest rates ranging from 2.76%-8% (2014 : 2.76%-8%)

104
Asdion Berhad
(590812-D)

ANNUAL REPORT 2015

Notes to the Financial Statements (Contd)

22. BORROWINGS

Group Company
2015 2014 2015 2014
RM RM RM RM

Current

Secured
Term loan (1) 989,951 159,878 989,951 159,878
Term loan (2) 269,246 73,349 269,246 73,349
Term loan (3) 11,031 103,324
Term loan (4) 5,308 4,557
Term loan (5) 77,371 93,647
Term loan (6) 8,343
Term loan (7) 6,564
Bank overdraft 109,217
Bills payable 194,046 322,431

1,546,953 881,310 1,259,197 233,227

Non-current

Secured
Term loan (1) 1,056,075 1,056,075
Term loan (2) 286,621 286,621
Term loan (3) 127,217 136,490
Term loan (4) 840 9,802
Term loan (5) 1,445,544 1,458,893
Term loan (6) 111,794
Term loan (7) 180,252

1,573,601 3,239,927 1,342,696

The term loan of the Group and of the Company are secured by:-

(a) Term loan 1 and 2

(i) legal charges over the Group and the Companys freehold and leasehold land and
building
(ii) corporate guarantees issued by certain present and former subsidiaries of the
Company

(b) Term loan 3 and 4

(i) personal guarantee from the director of the Company


(ii) legal charges over the leasehold property of the Group

105
Notes to the Financial Statements (Contd)

22. BORROWINGS (CONTD)

The term loan of the Group and of the Company are secured by (Contd):-

(c) Term loan 5

(i) A personal guarantee from the director of the Company


(ii) legal charges over the leasehold property of the Group

(d) Term loan 6, 7 and bank overdraft

(i) a joint and several guarantee of certain present and former directors of a subsidiary
(ii) a corporate guarantee from a subsidiary

The bills payable are secured by a personal guarantee by a director of a subsidiary.

The bank borrowings bears interest at rates ranging from 2.28% to 9.35% (2014: 2.03% to 9.1%)
per annum respectively.


23. TRADE PAYABLES

The normal trade credit terms granted to the Group ranges from 30 to 90 (2014: 30 to 90) days.

24. OTHER PAYABLES

Group Company
2015 2014 2015 2014
RM RM RM RM

Other payables 3,228,969 668,105 2,311,772 212,341


Accruals 421,190 577,021 93,432 174,316

3,650,159 1,245,126 2,405,204 386,657

25. AMOUNT DUE TO DIRECTORS

The amount due to directors is non-trade nature, unsecured, interest free and repayable on demand.

26. AMOUNT DUE TO SUBSIDIARIES

The amount due to subsidiaries is non-trade nature, unsecured, interest free and repayable on
demand.

106
Asdion Berhad
(590812-D)

ANNUAL REPORT 2015

Notes to the Financial Statements (Contd)

27. REVENUE

Group
2015 2014
RM RM

Trading of goods 1,156,232 2,300,023


Services rendered 3,167,343 2,069,359

4,323,575 4,369,382

28. LOSS BEFORE TAXATION

Group Company
2015 2014 2015 2014
RM RM RM RM

Loss before taxation is arrived


at after charging/(crediting):-
Amortisation of development costs 10,764 10,764 10,764 10,764
Audit fee
- auditors 102,200 113,500 70,000 67,000
- other auditors 62,767 59,053
Other fees charged by auditors 5,800 5,000 5,800
Bad debts written off 21,192 131,370
Director fees 292,491 46,000 172,811 46,000
Directors non-fee emoluments
- salaries, allowances and bonuses 278,975 633,507 30,205
- defined contribution plan 35,233 42,879 3,960
Depreciation of property,
plant and equipment 857,209 869,209 60,247 86,944
Impairment loss on:-
- investment in associates 135,518
- investment in subsidiaries 210,000
- trade receivables 10,747 18,519
- other investment 15,404
- amount due from subsidiaries 182,137
- intangible assets 393,247
Interest expense:
- bank overdrafts 10,273 10,601
- finance lease 2,908 7,749
- bills payable 9,055 25,712
- term loans 204,899 227,432 130,599 153,636
- others 336,848 20,128 326,400 7,949

107
Notes to the Financial Statements (Contd)

28. LOSS BEFORE TAXATION (CONTD)

Group Company
2015 2014 2015 2014
RM RM RM RM

Inventories written off 61,484


Rental of premises 299,547 114,249
Bad debt recovered (23,571)
Gain on disposal of:-
- property, plant and equipment (12,670)
- subsidiaries (487,838) (24,000)
Reliased loss/(gain) on
foreign exchange (4,136) (68,787)
Writeback of impairment
loss on amount due from
a subsidiary (41,427)
Interest income (141,131) (8,581) (139,784) (8,343)
Rental income (18,700)

29. TAX EXPENSE/(INCOME)

Group
2015 2014
RM RM

Current tax:-
Current financial year
- Malaysia 156,400
Under/(Over)provision in the previous financial year
- Malaysia 4 (11,023)

156,404 (11,023)
Deferred tax (Note 20):-

Current financial year 68,000 (51,832)
Overprovision in the previous financial year (59,260)

68,000 (111,092)

224,404 (122,115)

108
Asdion Berhad
(590812-D)

ANNUAL REPORT 2015

Notes to the Financial Statements (Contd)

29. TAX EXPENSE/(INCOME) (CONTD)

A reconciliation of income tax expense applicable to the loss before taxation at the statutory tax
rate to income tax expense at the effective tax rate of the Group and the Company are as follows:-

Group Company
2015 2014 2015 2014
RM RM RM RM

Loss before taxation (2,374,666) (3,384,500) (1,849,474) (1,517,999)

Tax at the statutory tax rate (593,667) (846,125) (462,369) (379,500)

Tax effects of:-


Non-allowable expense 717,400 584,403 366,369 374,825
Income not subject to tax (194,281) (6,000)
Change in tax rate for the
first tranche of chargeable
income (25,000)
Deferred tax assets not
recognised during the
financial year 269,431 265,000 102,000 4,675
Under provision in
previous year 4
Overprovision in the
previous financial year
- current tax (11,023)
- deferred tax (59,260)
Effects of tax rates in
different jurisdiction 50,517 (55,110)

Tax expense for the financial year 224,404 (122,115)

109
Notes to the Financial Statements (Contd)

30. LOSS PER SHARE



Group
2015 2014
RM RM

Loss after taxation attributable to owners


of the Company (RM) (2,810,009) (3,097,792)

Weighted average number of ordinary shares 112,734,600 77,798,479


Basic loss per share (SEN) (2.49) (3.98)


There is no dilution in the loss per share as the average market value of the Companys ordinary
shares during both financial years were lower than the exercise price of the outstanding Warrants
2014/2019 and 2008/2014 respectively. Accordingly, there would be no conversion of these
outstanding instruments for the purpose of calculating diluted loss per share.

31. EMPLOYEE BENEFITS EXPENSE

Group Company
2015 2014 2015 2014
RM RM RM RM

Salaries, wages and other


emoluments 1,399,995 1,454,245 6,400 131,495
Defined contribution plans 120,355 123,484 9,432
Other benefits 194 38,073 2,824

1,520,544 1,615,802 6,400 143,751

110
Asdion Berhad
(590812-D)

ANNUAL REPORT 2015

Notes to the Financial Statements (Contd)

32. DIRECTORS REMUNERATION

The aggregate amounts of remuneration payable to the directors of the Group and the Company
during the financial year are as follows:-

Group Company
2015 2014 2015 2014
RM RM RM RM

Executive directors:-
- salaries, allowances and bonuses 278,975 633,507 30,205
- defined contribution plan 35,233 42,879 3,960

314,208 676,386 34,165

33. RELATED PARTY DISCLOSURES

(a) Identities of related parties

The Group has related party relationships with its directors, key management personal and
entities within the same group of companies.

(b) In addition to the information detailed elsewhere in the financial statements, the Group and
the Company carried out the following transactions with the related parties during the financial
year:-

Group Company
2015 2014 2015 2014
RM RM RM RM

Key management
personal compensation:-
- salaries, allowances and
bonuses 278,975 633,507 30,205
- defined contribution plan 35,233 42,879 3,960
- director fees 292,491 46,000 172,811 46,000

111
Notes to the Financial Statements (Contd)

34. OPERATING SEGMENTS

Operating segments are prepared in a manner consistent with the internal reporting provided to
the Board of Directors in order to allocate resources to segments and to assess their performance.
For management purposes, the Group is organised into business units based on its geographical
locations, notably Malaysia, Singapore, Brunei and China. The Group operates within the
information, communication and technology and related activities.

The Board of Directors assesses the performance of the operating segments based on operating
profit or loss which is measured differently from those disclosed in the consolidated financial
statements.

Assets, liabilities and expenses which are common and cannot be meaningfully allocated to the
operating segments are presented under unallocated items, if any.

Malaysia Singapore China Group
2015 RM RM RM RM

Revenue
External revenue 3,468,807 787,816 66,952 4,323,575
Inter-segment revenue 130,856 417,653 548,509

3,599,663 1,205,469 66,952 4,872,084

Adjustments and eliminations (130,856) (417,653) (548,509)

Consolidated revenue 4,323,575

Results
Segment results (900,423) (291,155) (35,184) (1,226,762)

Interest income 141,131 141,131
Finance costs (512,736) (51,247) (563,983)
Depreciation of property,
plant and equipment (728,128) (127,493) (1,588) (857,209)
Amortisation of development costs (10,764) (10,764)
Other material income 509,717 37,198 546,915
Other non-cash and material items
of expenses (403,994) (403,994)

(1,905,197) (432,697) (36,772) (2,374,666)

Tax expense (224,404)



Consolidated loss after taxation (2,599,070)

112
Asdion Berhad
(590812-D)

ANNUAL REPORT 2015

Notes to the Financial Statements (Contd)

34. OPERATING SEGMENTS (CONTD)

Malaysia Singapore China Group


2014 RM RM RM RM

Revenue
External revenue 3,267,882 1,077,392 24,108 4,369,382
Inter-segment revenue 405,392 675,271 1,080,663

3,673,274 1,752,663 24,108 5,450,045

Adjustments and eliminations (1,080,663)

Consolidated revenue 4,369,382

Results
Segment results (1,374,842) (306,036) (221,284) (1,902,162)

Interest income 8,531 50 8,581
Finance costs (225,361) (66,261) (291,622)
Depreciation of property,
plant and equipment (743,964) (121,364) (3,881) (869,209)
Amortisation of development costs (10,764) (10,764)
Other material income 65,654 3,133 68,787
Other non-cash and material
items of expenses (230,925) (230,925)

(2,511,671) (490,528) (225,115) (3,227,314)



Share of loss in associates (157,186)
Tax income 122,115

Consolidated loss after taxation (3,262,385)

113
Notes to the Financial Statements (Contd)

34. OPERATING SEGMENTS (CONTD)

Malaysia Singapore China Group


2015 RM RM RM RM

Assets
Segment assets 31,652,968 3,605,538 5,445 35,263,951

Tax refundable 6,692

Consolidated total assets 35,270,643


Liabilities
Segment liabilities 5,314,914 4,894,254 49,399 10,258,567

Deferred tax liabilities 335,967
Tax payable 164,000

Consolidated total liabilities 10,758,534

Other segment items
Additional to non-current
assets other than financial
instruments:
- property, plant and equipment 159,151 159,151

Malaysia Singapore Brunei China Group


2014 RM RM RM RM RM

Assets
Segment assets 31,896,560 2,956,882 18,039 34,871,481

Tax refundable 22,803

Consolidated total assets 34,894,284

Liabilities
Segment liabilities 4,376,473 3,768,909 1,551 67,554 8,214,487

Deferred tax liabilities 265,035
Tax payable 5,772

Consolidated total liabilities 8,485,294

Other segment items
Additional to non-current
assets other than financial
instruments:
- property, plant and
equipment 82,955 82,955

114
Asdion Berhad
(590812-D)

ANNUAL REPORT 2015

Notes to the Financial Statements (Contd)

34. OPERATING SEGMENTS (CONTD)

(a) Other material items of income consists of the following:-

Group
2015 2014
RM RM

Bad debts recovered 23,571


Rental income 18,700
Gain on disposal of property, plant and equipment 12,670
Gain on disposal of subsidiaries 487,838
Realised gain on foreign exchange 4,136 68,787

546,915 68,787

(b) Other material non-cash items of expenses consists of the following:-

Group
2015 2014
RM RM

Impairment loss on intangible asset 393,247


Impairment loss on trade receivables 10,747 18,519
Impairment loss in associates 135,518
Impairment loss on other investment 15,404
Inventories written off 61,484

403,994 230,925

(c) Business segments

Revenue and non-current assets information based on the business segments of the Company
and its subsidiaries are as follows:-

Revenue Non-current assets


2015 2014 2015 2014
RM RM RM RM

Information, communication
and technology 2,497,634 3,338,177 16,006,462 14,386,752
Logistics 1,615,607 919,247
Media 210,334 1,031,205 104,644 912,787

4,323,575 4,369,382 17,030,353 15,299,539


Major customers

Revenue from a major customer with revenue more than 10% of Group revenue, amounting to
RM568,800 (2014: RM775,048) arose from logistics segment (2014: Sales of the information
communication and technology segment).

115
Notes to the Financial Statements (Contd)

35. FINANCIAL INSTRUMENTS

35.1 Categories of Financial Instruments

The table below provides an analysis of financial instruments categorised as loans and
receivables (L&R), available-for-sale financial assets (AFS) and financial liabilities
categorised as other liabilities measured at amortised cost (AC) :-

Carrying
amount L&R AFS AC
RM RM RM RM
Group

2015

Financial assets
Trade receivables 1,446,184 1,446,184
Other receivables 5,416,111 5,416,111
Cash and bank balances 1,867,779 1,867,779
Other investment 104,644 104,644

8,834,718 8,730,074 104,644

Financial liabilities
Trade payables 106,422 106,422
Other payables 3,650,159 3,650,159
Amount due to directors 3,290,789 3,290,789
Finance lease liabilities 90,643 90,643
Bank borrowings 3,120,554 3,120,554

10,258,567 10,258,567

2014

Financial assets
Trade receivables 419,319 419,319
Other receivables 3,236,249 3,236,249
Short-term deposits with
licenced bank 7,132 7,132
Cash and bank balances 15,540,055 15,540,055
Other investment 31,525 31,525

19,234,280 19,202,755 31,525

Financial liabilities
Trade payables 226,673 226,673
Other payables 1,245,126 1,245,126
Finance lease liabilities 147,333 147,333
Bank borrowings 4,121,237 4,121,237
Amount due to directors 2,474,118 2,474,118

8,214,487 8,214,487

116
Asdion Berhad
(590812-D)

ANNUAL REPORT 2015

Notes to the Financial Statements (Contd)

35. FINANCIAL INSTRUMENTS (CONTD)

35.1 Categories of Financial Instruments (Contd)

The table below provides an analysis of financial instruments categorised as loans and
receivables (L&R), available-for-sale financial assets (AFS) and financial liabilities
categorised as other liabilities measured at amortised cost (AC) (contd) :-

Carrying
amount L&R AFS AC
RM RM RM RM
Company

2015

Financial assets
Other receivables 5,006,625 5,006,625
Amount due from subsidiaries 227,523 227,523
Cash and bank balances 1,484,845 1,484,845

6,718,993 6,718,993

Financial liabilities
Other payables 2,405,204 2,405,204
Amount due to subsidiaries 2,810,322 2,810,322
Amount due to directors 106,892 106,892
Borrowing 1,259,197 1,259,197

6,581,615 6,581,615

2014

Financial assets
Other receivables 3,115,528 3,115,528
Cash and bank balances 15,463,286 15,463,286

18,578,814 18,578,814

Financial liabilities
Other payables 386,657 386,657
Amount due to subsidiaries 2,720,289 2,720,289
Amount due to directors 6,575 6,575
Bank borrowings 1,575,923 1,575,923

4,689,444 4,689,444

117
Notes to the Financial Statements (Contd)

35. FINANCIAL INSTRUMENTS (CONTD)

35.2 Financial Risk Management Objectivities and Policies

Financial Risk

The Group and the Company are exposed to financial risks arising from its operations and
the use of financial instruments. Financial risk management policy is established to ensure
that adequate resources are available for the development of the Groups and the Companys
business whilst managing its credit risk, liquidity risk, foreign currency risk and interest rate
risk. The Group and the Company operate within clearly defined policies and procedures that
are approved by the Board of Directors to ensure the effectiveness of the risk management
process.

The main areas of financial risks faced by the Group and the Company and the policy in
respect of the major areas of treasury activity are set out as follows:-

(a) Credit risk

Credit risk is the risk of a financial loss to the Group if a customer or counterparty to a
financial instrument fails to meet its contractual obligations. It is the Groups policy to
enter into financial instrument with a diversity of creditworthy counterparties. The Group
does not expect to incur material credit losses of its financial assets or other financial
instruments.

Concentration of credit risk exists when changes in economic, industry and geographical
factors similarly affect the group of counterparties whose aggregate credit exposure
is significant in relation to the Groups total credit exposure. The Groups portfolio of
financial instrument is broadly diversified along industry, product and geographical lines,
and transactions are entered into with diverse creditworthy counterparties, thereby
mitigate any significant concentration of credit risk.

It is the Groups policy that all customers who wish to trade on credit terms are subject
to credit verification procedures. The Group does not offer credit terms without the
approval of the head of credit control.

Following are the areas where the Group and the Company are exposed to credit risk:-

(i) Receivables

At the end of the reporting date, the maximum exposure to credit risk arising
from receivables is limited to the carrying amounts in the statements of financial
position.

With a credit policy in place to ensure the credit risk is monitored on an ongoing
basis, management has taken reasonable steps to ensure that receivables that
are neither past due nor impaired are stated at their realisable values. A significant
portion of these receivables are regular customers that have been transacting
with the Group. The Group uses ageing analysis to monitor the credit quality of
the receivables. Any receivables having significant balances past due more than
credit terms granted are deemed to have higher credit risk and are monitored
individually.

118
Asdion Berhad
(590812-D)

ANNUAL REPORT 2015

Notes to the Financial Statements (Contd)

35. FINANCIAL INSTRUMENTS (CONTD)

35.2 Financial Risk Management Objectivities and Policies (Contd)

Financial Risk (Contd)

The main areas of financial risks faced by the Group and the Company and the policy in
respect of the major areas of treasury activity are set out as follows (contd):-

(a) Credit risk (contd)

(i) Receivables (contd)

The ageing analysis of the trade receivables is as follows:

Group Individually
Gross impaired Net
RM RM RM

2015

Not past due 1,037,454 1,037,454


Past due 1-30 days 186,056 186,056
Past due 31-60 days 189,616 189,616
More than 60 days 37,758 (4,700) 33,058

1,450,884 (4,700) 1,446,184


2014

Not past due 247,574 247,574


Past due 1-60 days 87,857 87,857
Past due 60-120 days 53,822 53,822
More than 120 days 49,975 (19,909) 30,066

439,228 (19,909) 419,319

Trade receivables that are neither past due nor impaired are credit worthy
receivables with good payment records with the Group.

As at 31 March 2015, trade receivables of RM408,730 (2014: RM171,745) that are


past due but not impaired. These relate to a number of independent customers
for whom there is no recent history of default.

119
Notes to the Financial Statements (Contd)

35. FINANCIAL INSTRUMENTS (CONTD)

35.2 Financial Risk Management Objectivities and Policies (Contd)

Financial Risk (Contd)

The main areas of financial risks faced by the Group and the Company and the policy in
respect of the major areas of treasury activity are set out as follows (contd):-

(a) Credit risk (contd)

(i) Receivables (contd)

The credit risk concentration profile of the Group as at the end of the reporting
period is as follows:-

Group
2015 2014
RM RM
By country:-
Malaysia 1,284,626 298,433
Singapore 161,558 110,053
Others 10,833

1,446,184 419,319

As at the reporting date, approximately 39% (2014: Nil) of trade receivables was
due from one major customer.

As at the reporting date, approximately 96% (2014: 91%) of the other receivables
was due from a other debtor.

The net carrying amount of trade and other receivables is considered a reasonable
approximate of fair value. The maximum exposure to credit risk is the carrying value
of each class of receivables mentioned above. Trade receivables that are individually
determined to be impaired at the end of reporting period relate to receivables that
are in significant financial difficulties and have defaulted on payments. These
receivables are not secured by any collateral or credit enhancements.

(ii) Corporate guarantees

The maximum exposure to credit risk is represented by the outstanding banking


facilities of the subsidiary as at the end of the reporting period.

The Company provides financial guarantees to banks in respect of banking


facilities granted to a subsidiary. The Company monitors on an ongoing basis the
results of the borrowers and their repayments to the banks. As at the end of the
reporting period, there was no indication that any of the subsidiary would default
on repayment.

120
Asdion Berhad
(590812-D)

ANNUAL REPORT 2015

Notes to the Financial Statements (Contd)

35. FINANCIAL INSTRUMENTS (CONTD)

35.2 Financial Risk Management Objectivities and Policies (Contd)

Financial Risk (Contd)

The main areas of financial risks faced by the Group and the Company and the policy in
respect of the major areas of treasury activity are set out as follows (contd):-

(a) Credit risk (contd)

(iii) Intercompany balances

The maximum exposure to credit risk is represented by their carrying amount in


the statements of financial position.

The Company provides unsecured advance to subsidiaries and monitors the results
of the subsidiaries regularly. As at the end of the reporting period, there was no
indication that the advances to the subsidiaries are not recoverable.

b) Liquidity risk

Liquidity risk is the risk that the Group and the Company will not be able to meet their
financial obligations as they fall due.

In managing its exposures to liquidity risk arises principally from its various payables,
loans and borrowings, the Group maintains a level of cash and cash equivalents and
bank facilities deemed adequate by the management to ensure, as far as possible, that
it will have sufficient liquidity to meet its liabilities when they fall due.

The Group aims at maintaining a balance of sufficient cash and deposits and flexibility
in funding by keeping diverse sources of committed and uncommitted credit facilities
from various banks.

Following are the areas where the Group and the Company are exposed to liquidity risk:-

Group Carrying Contractual Within 1 to 2 to More than


amount cash flow 1 year 2 years 5 years 5 years
RM RM RM RM RM RM

2015

Trade payables 106,422 106,422 106,422
Other payables 3,650,159 3,650,159 3,650,159
Amount due to directors 3,290,789 3,290,789 3,290,789
Finance lease liabilities 90,643 94,625 49,518 45,107
Borrowings 3,120,554 3,596,125 1,939,135 447,135 1,209,855

10,258,567 10,738,120 9,036,023 492,242 1,209,855

121
Notes to the Financial Statements (Contd)

35. FINANCIAL INSTRUMENTS (CONTD)

35.2 Financial Risk Management Objectivities and Policies (Contd)

Financial Risk (Contd)

The main areas of financial risks faced by the Group and the Company and the policy in
respect of the major areas of treasury activity are set out as follows (contd):-

b) Liquidity risk (Contd)

Following are the areas where the Group and the Company are exposed to liquidity risk
(contd):-

Group Carrying Contractual Within 1 to 2 to More than


amount cash flow 1 year 2 years 5 years 5 years
RM RM RM RM RM RM

2014

Trade payables 226,673 226,673 226,673


Other payables 1,245,126 1,245,126 1,245,126
Amount due to directors 2,474,118 2,474,118 2,474,118
Finance lease liabilities 147,333 158,737 64,497 64,497 29,743
Borrowings 4,121,237 4,804,966 1,070,973 639,325 1,744,003 1,380,408

8,214,487 8,909,620 5,081,387 703,822 1,773,746 1,380,408

Company Carrying Contractual Within 1 to 2 to More than


amount cash flow 1 year 2 years 5 years 5 years
RM RM RM RM RM RM

2015

Other payables 2,405,204 2,405,204 2,405,204
Borrowings 1,259,197 1,492,000 1,492,000
Amount due to directors 106,892 106,892 106,892
Amount due to subsidiaries 2,810,322 2,810,322 2,810,322

6,581,615 6,814,418 6,814,418

2014
Other payables 386,657 386,657 386,657
Borrowings 1,575,923 1,852,000 360,000 360,000 1,132,000
Amount due to subsidiaries 2,720,289 2,720,289 2,720,289
Amount due to directors 6,575 6,575 6,575

4,689,444 4,965,521 3,473,521 360,000 1,132,000


122
Asdion Berhad
(590812-D)

ANNUAL REPORT 2015

Notes to the Financial Statements (Contd)

35. FINANCIAL INSTRUMENTS (CONTD)

35.2 Financial Risk Management Objectivities and Policies (Contd)

Financial Risk (Contd)

The main areas of financial risks faced by the Group and the Company and the policy in
respect of the major areas of treasury activity are set out as follows (contd):-

(c) Foreign currency risk

Foreign currency risk is the risk that the fair value or future cash flows of a financial
instrument will fluctuate because of changes in foreign exchange rates.

To mitigate the Groups exposure to foreign currency risk, the Group is exposed to
foreign currency risk on sales and purchases that are denominated in a currency other
than the respective functional currencies of the Group. The currency giving rise to this
risk is primarily United States Dollar (USD), Euro Dollar (EURO) and Singapore Dollar
(SGD).

The Groups exposure to foreign currency risk, based on carrying amounts as at the
end of the reporting period was:-

Group Company
Denominated in Denominated in
EURO USD SGD
2015 RM RM RM

Amount due to a subsidiary (105,565)


Trade payables (70,441)
Borrowings (76,051) (117,996)
Cash at bank 2,562
Trade receivable 2,716

(76,051) (183,159) (105,565)


Group Company
Denominated in Denominated in
USD SGD
2014 RM RM

Cash at bank 4,874


Amount due to a subsidiary (105,565)
Trade payables (61,807)
Borrowings (87,524)

(144,457) (105,565)

The management deemed the risk to be negligible as the said balances are immaterial.

123
Notes to the Financial Statements (Contd)

35. FINANCIAL INSTRUMENTS (CONTD)

35.2 Financial Risk Management Objectivities and Policies (Contd)

Financial Risk (Contd)

The main areas of financial risks faced by the Group and the Company and the policy in
respect of the major areas of treasury activity are set out as follows (contd):-

(d) Interest rate risk

Interest rate risk is the risk that the fair value or future cash flows of the Groups financial
instruments will fluctuate because of changes in market interest rates.

The Groups interest rate management objective is to manage the interest expenses
consistent with maintaining an acceptable level of exposure to interest rate fluctuation.

In order to achieve this objective, the Groups targets a mix of fixed and floating debt
based on assessment of its existing exposure and desired interest rate profile.

The interest rate profile of the Groups significant interest bearing financial instruments
based on the carrying amounts as at the end of the reporting period were as follows:-

2015 2014
Group RM RM
Fixed rate instruments

Financial asset
Short-term deposits with licenced bank 7,132


Financial liabilities
Finance lease liabilities 90,643 147,333
Borrowings 194,285 1,047,789

284,928 1,195,122

Floating rate instrument


Financial liability

Borrowings 2,926,269 3,073,448

2015 2014
Company RM RM
Floating rate instrument

Financial liability
Borrowings 1,259,197 1,575,923

124
Asdion Berhad
(590812-D)

ANNUAL REPORT 2015

Notes to the Financial Statements (Contd)

35. FINANCIAL INSTRUMENTS (CONTD)

35.2 Financial Risk Management Objectivities and Policies (Contd)

Financial Risk (Contd)

The main areas of financial risks faced by the Group and the Company and the policy in
respect of the major areas of treasury activity are set out as follows (contd):-

(d) Interest rate risk

The Group does not account for any fixed rate financial assets and liabilities through
profit or loss, and the Group does not designate derivatives as hedging instruments
under a fair value hedge accounting model. Therefore, a change in interest rate at the
reporting date would not affect profit or loss.

The following table illustrates the sensitivity of profit and equity to a reasonable possible
change in interest rates of +/- 50 basis point (bp). These changes considered to be
reasonably possible based on observation of current market conditions. The calculations
are based on a change in the average market interest rate for each period and the
financial instruments held at each reporting date that are sensitive to changes in interest
rates. All other variables are held constant.

Group Company
Profit for Profit for
the year Equity the year Equity
RM RM RM RM
50 bp 50 bp 50 bp 50 bp

2015 14,631 14,631 6,296 6,296


2014 15,367 15,367 7,880 7,880

125
Notes to the Financial Statements (Contd)

35. FINANCIAL INSTRUMENTS (CONTD)

35.3 Fair value of financial instruments

The table below analyses financial instruments carried at fair value and those not carried at
fair value for which fair value is disclosed, together with their values and carrying amounts
shown in the statement of financial position.

Fair value of financial Fair value of financial


instruments instruments not Carrying amount
carried at fair value carried at fair value
Level 1 Level 3
RM RM RM

2015
Group
Financial assets
Quoted shares 104,122 104,122

Financial liabilities
Finance lease liabilities 119,590 90,643
Borrowings 3,060,594 3,120,554

Company
Financial liabilities
Borrowings 1,259,197 1,259,197

2014
Group
Financial assets
Quoted shares 31,525 31,525

Financial liabilities
Finance lease liabilities 147,409 147,333
Borrowings 3,206,291 4,121,237

Company
Financial liabilities
Borrowings 1,535,781 1,535,923


There were no transfers between Level 1 and Level 3 during the financial period (2014: no
transfer in either direction).

126
Asdion Berhad
(590812-D)

ANNUAL REPORT 2015

Notes to the Financial Statements (Contd)

35. FINANCIAL INSTRUMENTS (CONTD)

35.3 Fair value of financial instruments (Contd)

Policy on transfer between levels

The fair value of an asset to be transferred between levels is determined as of the date of the
event or change in circumstances that caused the transfer.

Level 1 Fair Value

Level 1 fair value is derived from quoted price (unadjusted) in active markets for identical
financial assets or liabilities that the entity can access at the measurement date.

Level 3 Fair Value

Level 3 fair value is estimated using unobservable inputs for the financial assets and liabilities.

36. CONTINGENT LIABILITY-UNSECURED

Company
2015 2014
RM RM

Corporate guarantee given to a licensed bank for


banking facility granted to a subsidiary 144,404 254,173

37. SIGNIFICANT EVENTS

During the financial year

(a) The significant event during the financial year relating to the acquisition and disposal of
subsidiaries are disclosed in Note 5 to the Financial Statements.

(b) The significant event during the financial year relating to a Sale and Purchase Agreement
with a third party for the disposal of the freehold land and building are disclosed in Note 17
to the Financial Statements.

(c) An agreement is entered with Top Valley Properties Sdn. Bhd. Which is undertaking a property
project as disclosed in Note 10 to the Financial Statements.

After the reporting period

(a) A wholly-owned subsidiary of the Company, Venice Sanctuary Sdn. Bhd. (VSSB) had on 2
June 2015, extended into a Sourcing and Offer Take Agreement with Hong Kong International
Mining Exchange Ltd (HKIM) for the supply of bauxite by VSSB to HKIM.

127
Notes to the Financial Statements (Contd)

DISCLOSURE OF REALISED AND UNREALISED PROFITS

Bursa Malaysia Securities Berhad had on 25 March 2010 and 20 December 2010, issued directives
requiring all listed corporations to disclose the breakdown of unappropriated profits or accumulated
losses into realised and unrealised on Group and Company basis, as the case may be, in quarterly
reports and annual audited financial statements.

The breakdown of unappropriated losses as at the reporting date that has been prepared by the Directors
in accordance with the directives from Bursa Malaysia Securities Berhad stated above and Guidance
on Special Matter No. 1 issued on 20 December 2010 by the Malaysian Institute of Accountants are as
follows:-

2015 2014
RM RM

Group

Total accumulated losses of the Group:
- Realised (11,776,170) (8,254,758)
- Unrealised (68,000) (30,335)

(11,844,170) (8,285,093)

Total accumulated losses from associate:-


- Realised (364,518) (364,518)

(12,208,688) (8,649,611)

Less: Consolidation adjustment (2,970,909) (3,959,955)

Total accumulated losses as per consolidated


financial statements (15,179,597) (12,609,566)

2015 2014
RM RM

Company

Total accumulated losses of the Company:
- Realised (15,045,240) (13,195,766)
- Unrealised (194,003) (194,003)

Total accumulated losses as per financial statements (15,239,243) (13,389,769)

The disclosure of realised and unrealised above is solely for complying with the disclosure requirements
stipulated in the directive of Bursa Malaysia Securities Berhad and should not be applied for any other
purposes.

128
Asdion Berhad
(590812-D)

ANNUAL REPORT 2015

List of Properties

NBV as at
S/N Beneficial Owner/ Description/ Land/ 31.3.2015
Location Encumbrance Built-Up Area (RM)

1. Asdion Berhad bearing the The Sales & Purchases A p p ro x i m a t e l y 9,000,834


beneficial owner of this postal Agreement was completed 13,288 square feet
address of No. 9, Persiaran on 13 April 2006. in area together
Industri, Bandar Sri Damansara, with one (1) unit
52200 Kuala Lumpur, Malaysia. T h e p u r c h a s e o f t h i s of a Six (6) storey
property is financed by detached building
All that piece of freehold land banking facilities from, and areacted
held under H.S. (D) 85943, P.T. presently assigned to RHB
No.23983 in the Mukim of Sungai Bank Berhad.
Buloh, District of Petaling and
state of Selangor.

The acquisition value for this


property is RM3,570,000 dated
13 April 2006.

The Company did a revaluation


on 12 March 2013. The valuation
surplus of RM4,238,783 had been
incorporation in the consolidated
financial statements of company
for the financial year ended 31
March 2013.

129
List of Properties (Contd)

NBV as at
S/N Beneficial Owner/ Description/ Land/ 31.3.2015
Location Encumbrance Built-Up Area (RM)

2. TIS bearing the beneficial owner of A leasehold estate for a term Approximately 96 2,850,884*
this postal address of 1 Pemimpin of 999 years commencing square meters.
Drive, #05-07, Singapore 576151, from 6 July 1885.
being a unit forming part of a
building know as One Pemimpin The Sales & Purchases
built on part of the land in the Agreement was completed
District of Toh Payoh in the on 13 April 2011.
Republic of Singapore, being
part of Government Resurvey The property presently
Lots 6322A and 16928T both of assigned to DBS Bank Ltd
Mukim 18 forming part of the land for banking facility.
contained in State Lease No. 2074
and 26920 respectively.

This property was acquired


on 13 April 2013 at a value of
SGD849,920. (Approximately
RM2,117,236)

The Company did a revaluation


on 15 March 2013. The valuation
surplus of RM572,903 had been
incorporation in the consolidated
financial statements of company
for the financial year ended 31
March 2013

Notes:
* Based on exchange rate of RM2.6997 for every SGD$1

130
Asdion Berhad
(590812-D)

ANNUAL REPORT 2015

Analysis of Shareholdings
As at 24 July 2015

Authorised Share Capital : RM50,000,000


Issued & Paid-up Capital : RM11,320,890
Class of Shares : Ordinary Shares of RM0.10 each
Voting Rights : One Vote per Ordinary Share

DISTRIBUTION OF SHAREHOLDINGS
as at 24 July 2015

Size of Shareholdings No. of Shareholders % No. of Shares %

Less than 100 11 1.59 315 0.00


100 to 1,000 500 72.57 100,485 0.09
1,001 to 10,000 89 12.92 423,500 0.37
10,001 to 100,000 58 8.42 1,887,800 1.67
100,001 to 5,000,000* 27 3.92 40,222,200 35.53
5,000,001and above** 4 0.58 70,574,600 62.34

689 100.00 113,208,900 100.00

* Less than 5% of issued shares


** 5% and above of issued shares

SUBSTANTIAL SHAREHOLDERS
as at 24 July 2015

No. of Shares held


Name of Shareholdings Direct % Indirect %

Tey Por Yee 24,815,300 21.92


Na Chiang Seng 20,429,400 18.05
Goodunited Limited 19,176,000 16.94
Nutox Limited 6,153,900 5.44

DIRECTORS AND THEIR SHAREHOLDINGS


as at 24 July 2015

No. of Shares held


Name of Shareholdings Direct % Indirect %

Yap Tai Tee 3,400,542 3.00

131
Analysis of Shareholdings (Contd)

THIRTY LARGEST SHAREHOLDERS


as at 24 July 2015

No. Name of Shareholders No. of Shares %

1 JF APEX NOMINEES (TEMPATAN) SDN BHD 24,815,300 21.92


- PLEDGED SECURITIES ACCOUNT FOR TEY POR YEE
2 JF APEX NOMINEES (TEMPATAN) SDN BHD 20,429,400 18.05
- PLEDGED SECURITIES ACCOUNT FOR NA CHIANG SENG
3 GOODUNITED LIMITED 19,176,000 16.94
4 NUTOX LIMITED 6,153,900 5.44
5 JF APEX NOMINEES (ASING) SDN BHD 5,000,000 4.42
- PLEDGED SECURITIES ACCOUNT FOR FAST GLOBAL
INVESTMENTS LIMITED
6 RHB NOMINEES (TEMPATAN) SDN BHD 4,430,000 3.91
- PLEDGED SECURITIES ACCOUNT FOR MEGAT D.SHAHRIMAN
BIN ZAHARUDIN
7 PT NUSANTARA RISING RICH 4,222,000 3.73
8 TELECITY INVESTMENTS LIMITED 3,845,800 3.40
9 YAP TAI TEE 3,400,000 3.00
10 LIOW ENG CHUAN 3,074,000 2.72
11 JF APEX NOMINEES (TEMPATAN) SDN BHD 2,093,000 1.85
- PLEDGED SECURITIES ACCOUNT FOR SERENA GOH FHEN
FHEN
12 HSBC NOMINEES (ASING) SDN BHD 2,068,000 1.83
- AA NOMS SG FOR LINKSYS INVESTMENTS LIMITED
13 JF APEX NOMINEES (TEMPATAN) SDN BHD 1,765,300 1.56
- PLEDGED SECURITIES ACCOUNT FOR YEE YIT YANG
14 SJ SEC NOMINEES (TEMPATAN) SDN BHD 1,543,000 1.36
- PLEDGED SECURITIES ACCOUNT FOR OOI KOCK AUN
15 MAYBANK SECURITIES NOMINEES (ASING) SDN BHD 1,507,600 1.33
- MAYBANK KIM ENG SECURITIES PTE LTD FOR TEO EE
SENG
16 KENANGA NOMINEES (TEMPATAN) SDN BHD 1,191,000 1.05
- PLEDGED SECURITIES ACCOUNT FOR KOH PEE SENG
17 TAN SOCK LUAN 1,000,000 0.88
18 HLIB NOMINEES (TEMPATAN) SDN BHD 879,500 0.78
- PLEDGED SECURITIES ACCOUNT FOR SOO TEE WEI
19 RHB NOMINEES (TEMPATAN) SDN BHD 790,000 0.70
- PLEDGED SECURITIES ACCOUNT FOR RAJA ABDULLAH BIN
RAJA BAHARUDIN
20 ANG YIOK @ HONG CHIN PAU 694,800 0.61

132
Asdion Berhad
(590812-D)

ANNUAL REPORT 2015

Analysis of Shareholdings (Contd)

No. Name of Shareholders No. of Shares %

21 LIM BOON HONG 475,000 0.42


22 TEO EE SENG 450,000 0.40
23 MAYBANK SECURITIES NOMINEES (ASING) SDN BHD 385,000 0.34
- MAYBANK KIM ENG SECURITIES PTE LTD FOR LOW SIEW YAM
24 JOAN YONG MUN CHING 245,600 0.22
25 AMSEC NOMINEES (TEMPATAN) SDN BHD 210,000 0.19
- LIM BOON YAW
26 DB (MALAYSIA) NOMINEE (TEMPATAN) SENDIRIAN BERHAD 200,000 0.18
- EXEMPT AN FOR DEUTSCHE BANK AG SINGAPOR
27 QUEK YONG WAH 200,000 0.18
28 MAYBANK NOMINEES (TEMPATAN) SDN BHD 152,600 0.13
- PLEDGED SECURITIES ACCOUNT FOR GOH BENG POH
29 KONG SEH KIANG 150,000 0.13
30 LOW CHEE KWONG 130,000 0.11

133
Analysis of Warrantholdings
As at 24 July 2015

Total Warrants Issued : 51,189,960


Warrant holders : 892

DISTRIBUTION OF WARRANTHOLDINGS
as at 24 July 2015

Size of Warrantholdings No. of Warrantholders % No. of Warrants %

Less than 100 641 71.86 7,511 0.01


100 to 1,000 104 11.66 31,710 0.06
1,001 to 10,000 58 6.50 330,330 0.65
10,001 to 100,000 67 7.51 2,190,735 4.28
100,001 to 1,000,000* 15 1.68 5,274,100 10.30
1,000,001and above** 7 0.75 43,355,574 84.70

892 100.00 51,189,960 100.00

* Less than 5% of issued warrants


** 5% and above of issued warrant

SUBSTANTIAL WARRANTHOLDERS
as at 24 July 2015

No. of Warrant held


Name of Warrantholdings Direct % Indirect %

Goodunited Limited 22,205,600 43.38


JF Apex Nominees (Asing) Sdn Bhd 7,500,000 14.65
- Pledged securities account for
Fast Global Investments Limited
PT Nusantara Rising Rich 6,340,500 12.39

DIRECTORS AND THEIR WARRANTHOLDINGS


as at 24 July 2015

No. of Warrant held


Name of Warrantholdings Direct % Indirect %

Yap Tai Tee 340,054 0.66

134
Asdion Berhad
(590812-D)

ANNUAL REPORT 2015

Analysis of Warrantholdings (Contd)

THIRTY LARGEST WARRANTHOLDERS


as at 24 July 2015

No. of Warrant
No. Name of Warrantholders %
Held

1 GOODUNITED LIMITED 22,205,600 43.38


2 JF APEX NOMINEES (ASING) SDN BHD 7,500,000 14.65
- PLEDGED SECURITIES ACCOUNT FOR FAST GLOBAL
INVESTMENTS LIMITED
3 PT NUSANTARA RISING RICH 6,340,500 12.39
4 JF APEX NOMINEES (TEMPATAN) SDN BHD 2,481,534 4.85
- PLEDGED SECURITIES ACCOUNT FOR TEY POR YEE
5 HLIB NOMINEES (TEMPATAN) SDN BHD 2,063,440 4.03
- PLEDGED SECURITIES ACCOUNT FOR SOO TEE WE
6 HLIB NOMINEES (TEMPATAN) SDN BHD 1,618,800 3.16
- PLEDGED SECURITIES ACCOUNT FOR SOO TEE WE
7 KENANGA NOMINEES (TEMPATAN) SDN BHD 1,145,700 2.24
- PLEDGED SECURITIES ACCOUNT FOR KOH PEE SENG
8 NUTOX LIMITED 858,740 1.68
9 LEE LAI YENG 688,200 1.34
10 CHAI CHAT LEONG 620,000 1.21
11 MAYBANK SECURITIES NOMINEES (ASING) SDN BHD 440,000 0.86
- MAYBANK KIM ENG SECURITIES PTE LTD FOR TEO EE SENG
12 NGIAM LI SIOK 400,000 0.78
13 TELECITY INVESTMENTS LIMITED 359,160 0.70
14 YAP TAI TEE 340,000 0.66
15 KHOO BOO LYE 300,000 0.59
16 TAN YEOW MENG 232,000 0.45
17 TAN GEK HONG 212,000 0.41
18 LOH KIN HENG 200,000 0.39
19 LEE WEI LING 183,000 0.36
20 LEONG WENG KEONG 171,000 0.33
21 LOCK SOI NGEN @ LOCK SOI NGIN 150,000 0.29
22 MERCSEC NOMINEES (TEMPATAN) SDN BHD 120,000 0.23
- PLEDGED SECURITIES ACCOUNT FOR TEY HOCK LAI
23 CHAI MING FATT 100,000 0.20
24 LOW LAI PENG 100,000 0.20
25 PUBLIC NOMINEES (TEMPATAN) SDN BHD 100,000 0.20
- PLEDGED SECURITIES ACCOUNT FOR HOO KE PING @
HOO KHI PING
26 TAN SOCK LUAN 100,000 0.20
27 MAYBANK NOMINEES (TEMPATAN) SDN BHD 93,590 0.18
- FAIZATUL IKMI BINTI ABD RAZAK
28 CHUAH KOOI LIN @ LIM KOOI LIN 80,000 0.16
29 JENNY CHUNG VUI LING 60,000 0.12
30 SUMI MATSUMURA 54,000 0.11

135
This page has been Intentionally left blank
Solutions for Growing Businesses
ASDION BERHAD
Company No. 590812-D
(Incorporated in Malaysia under the Companies Act, 1965)

Form of Proxy CDS Account No.


Total number of ordinary shares held
No. of Ordinary Shares to be represented Proxy 1 Proxy 2
by each proxy

I/We.............................................................................. NRIC No./Company No.........................................................


(full name in block letters)

of.................................................................................................................................................................................
(full address)
being a member/members of ASDION BERHAD, hereby appoint ............................................................................
(full name in block letters)
NRIC No...................................................... of ...........................................................................................................
(full address)
....................................................................................................................................................................................

and/or failing him/her,..................................................................................................................................................


(full name in block letters)
NRIC No...................................................... of ...........................................................................................................
(full address)
....................................................................................................................................................................................
or failing him/her, the Chairman of the Meeting, as my/our proxy to vote for me/us and on my/our behalf at the
Thirteenth Annual General Meeting of the Company to be held at Sri Damansara Club Berhad, Lot 23304, Persiaran
Perdana, Bandar Sri Damansara, 52200 Kuala Lumpur on Monday, 28 September 2015 at 10.00 a.m. or at any
adjournment thereof.
Please indicate with an X in the spaces provided below on how you wish your votes to be cast. (If you do not do
so, the Proxy will vote or abstain from voting at his/her discretion).
RESOLUTIONS FOR AGAINST
1. Re-election of Director : Mr. See Poh Yee
2. Re-election of Director : Mr. Selva Rasan A/L Dato Puspa Das
3. Re-election of Director : Encik Mohamad Farid Bin Mohd Yusof
4. Re-election of Director : Datuk Raime Bin Unggi
5. Re-election of Director : Dato Yen Soon Ai
6. Re-election of Director : Tengku Azlan Ibni Sultan Abu Bakar
7. Re-election of Director : Dato Mohamed Ridzuan Bin Nor Md
8. To approve the payment of Directors Fees for the financial year ended 31
March 2015
9. To re-appoint Messrs. SJ Grant Thornton as the Auditors of the Company
and to authorise the Directors to fix their remuneration
10. Special Business
Ordinary Resolution
- Authority to issue and allot shares pursuant to Section 132D of the
Companies Act, 1965

As witness my hand this ........ day of ......................................... 2015

................................................................
Signature of Member(s)/ Common Seal
Notes :
1. In respect of deposited securities, only members whose name appear in the Record of Depositors as at 21 September 2015
(General Meeting Record of Depositors) shall be regarded as a member entitled to attend, speak and vote or to appoint
a proxy or proxies to attend, speak and vote at the Thirteenth Annual General Meeting.
2. A member of the Company entitled to attend and vote at the meeting is entitled to appoint a proxy to attend and vote in
his stead. A member may appoint more than one proxy to attend at the same meeting. Where a member appoints more
than one proxy, the appointment shall be invalid unless he specifies the proportion of his shareholding to be represented
by each proxy.
3. A proxy may but need not be a member of the Company and the provisions of Section 149(1)(b) of the Companies Act,
1965 shall not apply to the Company.
4. The instrument appointing a proxy shall be in writing under the hand of the appointor or of his attorney duly authorised in
writing, or if the appointor is a corporation, either under its common seal or under the hand of an officer or attorney duly
authorised.
5. The instrument appointing a proxy must be deposited at the Companys Registered Office situated at Plaza 138, Suite
18.03, 18th Floor, 138 Jalan Ampang, 50450 Kuala Lumpur not less than forty-eight (48) hours before the time for holding
the meeting or at any adjournment thereof.

Then fold here

AFFIX
STAMP

The Company Secretaries


Asdion Berhad (590812-D)
Plaza 138, Suite 18.03, 18th Floor,
138, Jalan Ampang,
50450 Kuala Lumpur.

1st fold here


ASDION BERHAD
Solutions for Growing Businesses

ASDION BERHAD
(Company No.: 590812-D)

annual report
2015

ASDION BERHAD (590812-D)


ANNUAL REPORT 2015

Oval Tower @ Damansara


Unit 28-8, 28th Floor, No. 685 Jalan Damansara
TTDI, 60000 Kuala Lumpur, Malaysia

T: +603 7733 1399 F: +603 2856 9889

www.asdion.com