Review report of Independent Auditor To the Shareholders of Cal-Comp Electronics (Thailand) Public Company Limited

Transcription

1 Cal-Comp Electronics (Thailand) Public Company Limited and its subsidiaries Review report and interim financial statements For the three-month and nine-month periods ended September 2011 and 2010

2 Review report of Independent Auditor To the Shareholders of Cal-Comp Electronics (Thailand) Public Company Limited I have reviewed the accompanying consolidated statement of financial position of Cal-Comp Electronics (Thailand) Public Company Limited and its subsidiaries as at September 2011, the related consolidated statements of income and comprehensive income for the three-month and nine-month periods ended September 2011 and 2010, the consolidated statements of changes in shareholders equity and cash flows for the nine-month periods ended September 2011 and 2010, and the separate financial statements of Cal-Comp Electronics (Thailand) Public Company Limited for the same periods. These financial statements are the responsibility of the Company's management as to their correctness and the completeness of the presentation. My responsibility is to issue a report on these financial statements based on my reviews. I did not review the interim financial statements of the overseas subsidiaries as discussed in Note 1.3 to the financial statements which are included in the consolidated financial statements for the three-month and nine-month periods ended September 2011 and The financial statements of these subsidiaries present total assets of Baht,580 million and Baht 27,582 million, respectively, and total revenues for the three-month and nine-month periods then ended of Baht 21,427 million (2010: Baht 19,049 million) and Baht 61,224 million (2010: Baht 51,471 million), respectively. The interim financial statements of the subsidiaries were reviewed by other auditors, whose reports have been furnished to me, and my review report, in sofar as it relates to the amounts of the various transactions of those subsidiaries included in the consolidated financial statements, is based on those auditors reports. I conducted my reviews in accordance with the auditing standard applicable to review engagements. This standard requires that I plan and perform the review to obtain moderate assurance as to whether the financial statements are free of material misstatement. A review is limited primarily to inquiries of company personnel and analytical procedures applied to financial data and thus provides less assurance than an audit. I have not performed an audit and, accordingly, I do not express an audit opinion.

3 Based on my reviews and the review reports of other auditors, nothing has come to my attention that causes me to believe that the accompanying financial statements are not presented fairly, in all material respects, in accordance with generally accepted accounting principles. I draw attention to Note 5 to the financial statements. The Company has substantial product sales and raw material purchase transactions in the financial statements with its subsidiaries and related companies. I have previously audited the consolidated financial statements of Cal-Comp Electronics (Thailand) Public Company Limited and its subsidiaries and the separate financial statements of Cal-Comp Electronics (Thailand) Public Company Limited for the year ended December 2010 in accordance with generally accepted auditing standards and expressed an unqualified opinion on those statements and drew attention to the Company had substantial product sales and raw material purchase transactions with its subsidiaries and related companies, based on my report dated 9 February The consolidated and separate statements of financial position as at December 2010, as presented herein for comparative purposes, formed an integral part of the financial statements which I audited and reported on, based on my audit and the reports of other auditors of the subsidiaries. I have not performed any other audit procedures subsequent to the date of the above report. In addition, as described in Note 1.4 to the financial statements, during the current period, the Company adopted the revised and new accounting standards issued by the Federation of Accounting Professions, and applied them in its preparation and presentation of the interim financial statements. Rungnapa Lertsuwankul Certified Public Accountant (Thailand) No Ernst & Young Office Limited Bangkok: 4 November

4 Cal-Comp Electronics (Thailand) Public Company Limited and its subsidiaries Statements of financial position Consolidated financial statements Separate financial statements Note September 2011 December 2010 September 2011 December 2010 (Unaudited (Audited) (Unaudited (Audited) but reviewed) but reviewed) Assets Current assets Cash and cash equivalents 1,795,714 5,351, ,882 1,350,404 Current investments Term deposits at financial institutions 7, , ,866 1 Trade accounts receivable Related parties 2,409, ,640 2,367,656 2,473,894 Unrelated parties 29,446,511 28,293,783 12,653,282 12,955,671 Less: Allowance for doubtful accounts (367,0) (351,475) (39,673) (44,817) Trade accounts receivable, net 4, 5,488,987 28,805,948 14,981,265 15,384,748 Short-term loans to related parties, net 5 3, Amount due from related parties, net 5 43,967 9, ,889 41,279 Inventories, net 6 10,784,227 9,804,735 4,481,472 5,094,374 Goods in transit 1,615, ,353 1,512, ,613 Advances payment for raw materials, net 7 760, , , ,6 Other receivables, net 8 327, , , ,987 Other current assets 9 770, ,252 91,619 42,918 Total current assets 47,896,967 45,981,459 22,483,0 22,323,640 Non-current assets Investments in subsidiaries, net ,173,429 5,477,827 Investments in associates, net , , Other long-term investments, net 12 89,504 88,321 52,106 52,106 Property, plant and equipment, net 13 10,823,323 9,481,883 4,789,378 4,801,768 Goodwill 105, , Other intangible assets, net , , Other non-current assets 15 Land occupancy rights, net 88,196 83, Others 271,158 90,610 1, Total non-current assets 11,741,183 10,9,459 11,016,039 10,332,671 Total assets 59,638,150 56,0,918 33,499,070 32,656,1 The accompanying notes are an integral part of the financial statements. 3

5 Cal-Comp Electronics (Thailand) Public Company Limited and its subsidiaries Statements of financial position (continued) Consolidated financial statements Separate financial statements Note September 2011 December 2010 September 2011 December 2010 (Unaudited (Audited) (Unaudited (Audited) but reviewed) but reviewed) Liabilities and shareholders' equity Current liabilities Short-term loans from financial institutions 16, 19 13,107,523 11,973,070 4,267,029 4,601,750 Trade accounts payable Related parties 5 2,222,674 1,963, ,016 0,324 Unrelated parties 23,463,656 22,273,343 12,168,834 11,880,727 Total trade accounts payable 25,686,3 24,236,467 12,327,850 12,181,051 Advance from and amount due to related parties 5 108,620 4,699,643 68,345 Income tax payable 37,724 16,735 2,750 1,323 Other current liabilities Accrued interest expense 69,795 55,772 1,209 1,433 Accrued expenses 967,880 1,372, , ,579 Other payable 17 1,813,135 1,294, , ,712 Excess of cost of net asset value over investment in a subsidiary , Others , , , ,203 Total current liabilities 42,614,5 39,503,059 17,855,092 17,6,396 Non-current liabilities Reserve for long-term employee benefits 51,068-43,091 - Total non-current liabilities 51,068-43,091 - Total liabilities 42,665,598 39,503,059 17,898,183 17,6,396 Shareholders' equity Share capital Registered 20 4,277,556,192 ordinary shares of Baht 1 each ( December 2010: 4,485,386,292 ordinary shares of Baht 1 each) 4,277,556 4,485,386 4,277,556 4,485,386 Issued and paid up share capital 4,077,556,192 ordinary shares of Baht 1 each 4,077,556 4,077,556 4,077,556 4,077,556 Share premium 3,144,544 3,144,544 3,144,544 3,144,544 Retained earnings Appropriated - statutory reserve 511, , , ,111 Unappropriated 9,681,275 9,677,561 7,867,676 7,292,704 Other components of shareholders' equity (441,934) (612,913) - - Total shareholders' equity 16,972,552 16,797,859 15,600,887 15,025,915 Total liabilities and shareholders' equity 59,638,150 56,0,918 33,499,070 32,656, The accompanying notes are an integral part of the financial statements. Directors 4

6 Cal-Comp Electronics (Thailand) Public Company Limited and its subsidiaries Income statements For the three-month periods ended September 2011 and 2010 Consolidated financial statements Separate financial statements Note Revenues Sales 5 37,056,516 32,578,202 15,605,145 17,266,129 Exchange gains 21 89,373 19, ,6 Other income 73,332 35,559 11,284 3,2 Total revenues 37,219,221 32,633,742 15,616,429 17,445,665 Expenses Cost of sales 5 36,021,220,325,219 15,017,740 16,902,585 Selling expenses 137, ,695 10,761 9,951 Administrative expenses 696, ,441,966 16,577 Exchange loss ,713 - Total expenses 36,855,398 32,057,355 15,129,180 16,929,113 Profit before share of loss from investment in associate 363, , , ,552 Share of loss from investment in associate (2,197) (2,023) - - Profit before finance cost and corporate income tax 361, , , ,552 Finance cost (69,003) (50,446) (11,347) (19,365) Profit before corporate income tax 292, , , ,187 Corporate income tax 22 (,992) (22,875) 21 (575) Profit for the period 261,6 501, , ,612 Profit attributable to Equity holders of the Company 261,6 501,2 475, ,612 Non-controlling interests of the subsidiaries - (269) 261,6 501,043 (Unit: Baht) Earnings per share 23 Basic earnings per share Profit attributable to equity holders of the Company Diluted earnings per share Profit attributable to equity holders of the Company The accompanying notes are an integral part of the financial statements. 5

7 Cal-Comp Electronics (Thailand) Public Company Limited and its subsidiaries Statements of comprehensive income For the three-month periods ended September 2011 and 2010 Consolidated financial statements Separate financial statements Profit for the period 261,6 501, , ,612 Other comprehensive income: Exchange differences on translation of financial statements in foreign currency (120,090) (1,669) - - Other comprehensive income for the period (120,090) (1,669) - - Total comprehensive income for the period 141, , , ,612 Total comprehensive income attributable to Equity holders of the Company 141, , , ,612 Non-controlling interests of the subsidiaries - (269) , , , ,612 The accompanying notes are an integral part of the financial statements. 6

8 Cal-Comp Electronics (Thailand) Public Company Limited and its subsidiaries Income statements For the nine-month periods ended September 2011 and 2010 Consolidated financial statements Separate financial statements Note Revenues Sales 5 101,039,704 89,440,901 41,398,013 49,989,829 Exchange gains , ,882 Other income 184, ,495 32,810 12,325 Total revenues 101,418,597 89,547,396 41,4,823 50,186,036 Expenses Cost of sales 5 98,036,765 85,819,639 39,852,964 48,897,409 Selling expenses 365, ,210 28,581 27,054 Administrative expenses 2,067,049 1,746, , ,469 Exchange loss 21-15, ,409 - Total expenses 100,469,2 87,840,620 40,132,093 49,036,932 Profit before share of loss from investment in associate 949,295 1,706,776 1,298,7 1,149,104 Share of loss from investment in associate (1,051) (2,023) - - Profit before finance cost and corporate income tax 948,244 1,704,753 1,298,7 1,149,104 Finance cost (162,801) (129,745) (32,014) (41,588) Profit before corporate income tax 785,443 1,575,008 1,266,716 1,107,516 Corporate income tax 22 (92,584) (161,339) (2,599) (2,779) Profit for the period 692,859 1,413,669 1,264,117 1,104,737 Profit attributable to Equity holders of the Company 692,859 1,422,706 1,264,117 1,104,737 Non-controlling interests of the subsidiaries - (9,037) 692,859 1,413,669 (Unit: Baht) Earnings per share 23 Basic earnings per share Profit attributable to equity holders of the Company Diluted earnings per share Profit attributable to equity holders of the Company The accompanying notes are an integral part of the financial statements. 7

9 Cal-Comp Electronics (Thailand) Public Company Limited and its subsidiaries Statements of comprehensive income For the nine-month periods ended September 2011 and 2010 Consolidated financial statements Separate financial statements Profit for the period 692,859 1,413,669 1,264,117 1,104,737 Other comprehensive income: Exchange differences on translation of financial statements in foreign currency 170,979 (467,442) - - Other comprehensive income for the period 170,979 (467,442) - - Total comprehensive income for the period 863, ,227 1,264,117 1,104,737 Total comprehensive income attributable to Equity holders of the Company 863, ,264 1,264,117 1,104,737 Non-controlling interests of the subsidiaries - (9,037) , ,227 1,264,117 1,104,737 The accompanying notes are an integral part of the financial statements. 8

10 Cal-Comp Electronics (Thailand) Public Company Limited and its subsidiaries Statements of changes in shareholders' equity For the nine-month periods ended September 2011 and 2010 Consolidated financial statements Equity attributable to the parent's shareholders Other components of equity Share deficit is Other comprehensive income incurred due to share purchase Exchange from the minority differences on Subscription shareholders translation of received in of the subsidiary Total other Total equity Equity attributable Issued and financial advance from without losing components of attributable to to non-controlling Total fully paid-up Retained earnings statements in exercise the controlling shareholders' shareholders of interests of shareholders' share capital Share premium Appropriated Unappropriated foreign currency of warrants interest equity the Company the subsidiaries equity Balance as at 1 January ,941,109 3,144, ,111 8,527,807 (187,751) - - (187,751) 15,936,820-15,936,820 Capital increased due to convert warrants to shares 28, ,735-28,735 Dividend paid (Note 25) (514,356) (514,356) - (514,356) Total comprehensive income for the period ,422,706 (467,442) - - (467,442) 955,264 (9,037) 946,227 Subscription received in advance from exercise of warrants , , , ,712 Increase in share deficit is incurred due to share purchase from the minority shareholders without losing the controlling interest (21,432) (21,432) (21,432) 9,037 (12,395) Balance as at September ,969,844 3,144, ,111 9,436,157 (655,193) 107,712 (21,432) (568,913) 16,492,743-16,492,743 Balance as at 1 January ,077,556 3,144, ,111 9,677,561 (591,481) - (21,432) (612,913) 16,797,859-16,797,859 Cumulative effect of change in accounting policy for employee benefits (Note 2) (36,736) (36,736) - (36,736) Dividend paid (Note 25) (652,409) (652,409) - (652,409) Total comprehensive income for the period , , , , ,838 Balance as at September ,077,556 3,144, ,111 9,681,275 (420,502) - (21,432) (441,934) 16,972,552-16,972,552 The accompanying notes are an integral part of the financial statements. 9

11 Cal-Comp Electronics (Thailand) Public Company Limited and its subsidiaries Statements of changes in shareholders' equity For the nine-month periods ended September 2011 and 2010 Separate financial statements Subscription received in Issued and advance from fully paid-up exercise of Retained earnings share capital Share premium warrants Appropriated Unappropriated Total Balance as at 1 January ,941,109 3,144, ,111 6,3,979 13,927,743 Capital increased due to convert warrants to shares 28, ,735 Subscription received in advance from exercise of warrants , ,712 Dividend paid (Note 25) (514,356) (514,356) Total comprehensive income for the period ,104,737 1,104,737 Balance as at September ,969,844 3,144, , ,111 6,921,360 14,654,571 Balance as at 1 January ,077,556 3,144, ,111 7,292,704 15,025,915 Cumulative effect of change in accounting policy for employee benefits (Note 2) (36,736) (36,736) Dividend paid (Note 25) (652,409) (652,409) Total comprehensive income for the period ,264,117 1,264,117 Balance as at September ,077,556 3,144, ,111 7,867,676 15,600,887 The accompanying notes are an integral part of the financial statements. 10

12 Cal-Comp Electronics (Thailand) Public Company Limited and its subsidiaries Statements of cash flows For the nine-month periods ended September 2011 and 2010 Consolidated financial statements Separate financial statements Cash flows from operating activities Profit before tax 785,443 1,575,008 1,266,716 1,107,516 Adjustments to reconcile profit before tax to net cash provided by (paid from) operating activities Depreciation and amortisation 1,388,684 1,499, , ,953 Allowance for doubtful accounts 13, , Loss (gain) on disposal of plant and equipment 47,584 47,476 (2,421) 5,377 Impairment loss of assets (reversal) (4,163) 27,615-4,163 26,729 Share of loss from investment in associate 1,051 2, Provision for long-term employee benefits 17,560-6,355 - Gain on write off investment in other long-term investment - (120) - - Reversal allowance for diminution in value of inventory (16,607) (90,177) (762) (3,683) Unrealised exchange loss 1, , ,326 84,544 Interest income (14,875) (8,4) (2,832) (2,491) Interest expense 145, ,682 25,382 34,808 Income from operating activities before change in operating assets and liabilities 2,495,218 3,409,936 1,969,720 1,709,852 Operating assets (increase) decrease Trade accounts receivable (966,633) (2,839,226) 488,485 (1,947,744) Trade accounts receivable - related parties (1,447,907) (1,584,698) 204,467 (1,849,7) Amounts due from related parties 6,334,439 (492,3) (156,236) Inventories (942,467) (3,467,099) 613,664 (2,471,934) Goods in transit (1,365,663) (366,749) (1,8,500) (6,587) Advances payment for raw materials (397,732) 16,419 (40,275) (25,725) Other receivables (156,917) 19,619 (147,347) 12,8 Other current assets (172,815) (675,780) (48,005) 8,217 Operating liabilities increase (decrease) Trade accounts payable 33,081 2,114,237 (437,545) 1,057,224 Trade accounts payable - related parties 253,286 1,574,589 (147,585) 289,435 Advance from and amounts due to related parties 103,920 1,907 (37,702) (191,990) Accrued expenses (500,856) 142,947 (18,734) 9,870 Other payables 458, , , ,688 Other current liabilities 255, , ,642 (13,179) Cash flows from (used in) operating activities (2,344,957) (994,158) 1,047,6 (3,4,585) Cash paid for corporate income tax (71,595) (208,169) (1,173) (6,336) Net cash from (used in) operating activities (2,416,552) (1,202,327) 1,046,133 (3,436,921) The accompanying notes are an integral part of the financial statements. 11

13 Cal-Comp Electronics (Thailand) Public Company Limited and its subsidiaries Statements of cash flows (continued) For the nine-month periods ended September 2011 and 2010 Consolidated financial statements Separate financial statements Cash flows from investing activities Increase in investment in subsidiary - - (695,603) (822,062) Net cash paid for purchase of subsidiary (120,054) Advance for share acquisition (227,108) Decrease in cash as result of change in company's shareholding in subsidiary - (338,714) - - Increase in other long-term investment - (48,461) - (48,461) Proceeds from write off other long-term investment - 9, Increase in property, plant and equipment (1,350,192) (1,112,149) (320,159) (800,048) Interest income 14,875 8,4 2,832 2,491 Proceeds from sales of equipment 250,452 46,341 51,877 2,682 Increase in intangible assets - (8,499) - - Decrease (increase) in other non-current assets (168,074) 365,665 (156) - Net cash used in investing activities (1,372,993) (1,077,604) (961,209) (1,892,506) Cash flows from financing activities Increase (decrease) in short-term loans from financial institutions 972,473 1,987,057 (467,566) 4,969,624 Decrease in long-term loans - (19,9) - - Interest expense (1,228) (119,083) (25,606) (34,124) Proceeds from increase in share capital - 28,735-28,735 Subscription received in advance from exercise of warrants - 107, ,712 Dividends paid (652,409) (514,356) (652,409) (514,356) Net cash from (used in) financing activities 188,836 1,470,135 (1,145,581) 4,557,591 Decrease in translation adjustment (98,282) (216,695) - - Net decrease in cash and cash equivalents (3,698,991) (1,026,491) (1,060,657) (771,836) Cash and cash equivalents at beginning of period 5,801,888 3,635,573 1,350,405 1,237,854 Cash and cash equivalents at end of period (Note 26) 2,102,897 2,609, , ,018 Supplemental cash flows information: - Non-cash items consist of: - Sale equipment that has not yet been received 15, ,091 2,664 Purchase of plant and equipment that has not yet been paid 909, , , ,625 The accompanying notes are an integral part of the financial statements. 12

14 Cal-Comp Electronics (Thailand) Public Company Limited and its subsidiaries Notes to interim consolidated financial statements For the three-month and nine-month periods ended September 2011 and General information 1.1 The Company's general information Cal-Comp Electronics (Thailand) Public Company Limited ( the Company ) is a public company incorporated and domiciled in Thailand. Its major shareholder is Kinpo Electronics, Inc., which was incorporated in Taiwan. The Company is principally engaged in the manufacture of electronic products in three sectors, such as computer and computer peripheral, telecommunication equipment and automation equipment. Its registered address is 191/54, 191/57 18th Floor, CTI Tower, Rachadapisek Road, Kwang Klongtoey, Khet Klongtoey, Bangkok The Company has 4 branches in Thailand and is located at Samutsakorn, Petchaburi and Nakhonratsima. 1.2 Basis of preparation of the interim financial statements These interim financial statements are prepared in accordance with Accounting Standard No. 34 (revised 2009) Interim Financial Reporting, which the Company choosing to present condensed interim financial statements. However, the Company has presented the statements of financial position, income statement, comprehensive income, changes in shareholders equity and cash flows in the same format as that used for the annual financial statements. The interim financial statements are intended to provide information additional to that included in the latest annual financial statements. Accordingly, they focus on new activities, events and circumstances so as not to duplicate information previously reported. These interim financial statements should therefore be read in conjunction with the latest annual financial statements. The interim financial statements in Thai language are the official statutory financial statements of the Company. The interim financial statements in English language have been translated from the Thai language financial statements. 13

15 1.3 Basis of consolidation These consolidated interim financial statements are prepared by applying the same basis as that applied for the preparation of the consolidated financial statements for the year ended December There has been the following change in the composition of the group of company during the current period. On 6 May 2011, the Company purchased 100% of the ordinary shares of Phitronics Industria e Comercio de Electronica e Informatica Ltda., a company in Brazil. The excess of the net value of assets over the purchase price acquired has been recorded in a suspense account under the caption of excess of net asset value over the cost of investment in a subsidiary, while awaiting the valuation of the net assets acquired at their fair value as of acquisition date. The Company recorded the net assets acquired at their net book value as of 1 May 2011 because it was closed to the acquisition date. The net asset value of Phitronics Industria e Comercio de Electronica e Informatica Ltda. as at 1 May 2011 consisted, of the following: Assets Cash and cash equivalents 1,1 Other current assets 7,806 Property, plant and equipment, net 112,118 Intangible assets - computer software 15,252 Other non-current assets 41,158 Total assets 177,645 Liabilities Short-term loans 29,136 Other liabilities 9,136 Total liabilities 38,272 Net asset value 139,373 14

16 Equity of the Company (%) 100 Net assets value attributable to the Company s investment 139,373 Negative goodwill (18,008) Purchase price 121,365 Less: Cash and cash equivalent of subsidiary (1,1) Net cash paid for purchase of subsidiary 120,054 Changing the name of the subsidiaries During the current quarter, the subsidiaries changed their names which are summarised below. New name Cal-Comp Precision (Singapore) Limited. Cal-Comp Precision (Malaysia) Sdn Bhd Cal-Comp Precision (Thailand) Limited Cal-Comp Precision (Wujiang) Co., Ltd. Former name Avaplas Ltd Avaplas Sdn Bhd Avaplas (Thailand) Limited Avaplas Precision Plastics (Wujiang) Co., Ltd. The financial statements of the subsidiaries were prepared by the management of the subsidiaries and reviewed by their auditors overseas. Their aggregate assets and revenues are as follows: - Nature of Country of Percentage of Revenues for the nine-month Company s name business incorporation shareholding Total assets as at periods ended September September December September December Percent Percent Million Million Million Million Baht Baht Baht Baht Reviewed by other auditors Logistar International Group company s British Virgin ,148 14,749 42,067 41,428 Holding Co., Ltd. distributor Island Cal-Comp Electronics Manufacture of The People s ,788 2,013 1, (Suzhou) Co., Ltd. electronic products Republic of China 15

17 Nature of Country of Percentage of Revenues for the nine-month Company s name business incorporation shareholding Total assets as at periods ended September September December September December Percent Percent Million Million Million Million Baht Baht Baht Baht Cal-Comp Optical Electronics Manufacture of The People s ,407 7,006 4,374 1,560 (Suzhou) Co., Ltd. electronic products Republic of China Cal-Comp Electronics & Purchasing material Taiwan Communications Co., Ltd. and research and development Cal-Comp Technology Manufacture of The People's ,934 3, ,690 (Suzhou) Co., Ltd. electronic products Republic of China Cal-Comp Electronics and Manufacture of The People's , , Communications (Suzhou) electronic Republic of China Co., Ltd. products Cal-Comp Electronics (USA) Manufacture of USA ,070 - Co., Ltd. and its subsidiaries electronic products Phitronics Industria e Manufacture of Brazil Comercio de Electronica e Informatica Ltda.* electronic products Cal-Comp Electronics de Manufacture of Mexico Mexico Co., S.A. de C.V.** electronic products Reviewed by other auditors of the same firm Cal-Comp Precision (Singapore) Manufacture and Singapore , , Limited. and its subsidiaries distributor of plastic components Cal Comp (Malaysia) SDN. Manufacture of Malaysia ,807 1,181 4, BHD. electronic products * The Company combined the financial statements of Phitronics Industria e Comercio de Electronica e Informatica Ltda. by using the financial statements for the period ended August 2011 which were prepared by the management of such company and has not been reviewed by its external auditor because the allocation process of assets and liabilities process between the buyer and the seller has not been completed and some expenses have to be allocated to the seller. However, the management of the Company believes that the operating 16

18 results during such period and for the period ended September 2011 when reviewed by its external auditor will be deemed immaterial. ** The financial statements were prepared by the management of the subsidiary and have not been reviewed by its external auditor. The operation of this subsidiary has not commenced. Major revenues of Logistar International Holding Co., Ltd. represent the sales of inventories, which are purchased transactions from the Company and its subsidiaries, received from the third parties. 1.4 Application of new accounting standards during the period During the current period, the Company adopted a number of revised and new accounting standards, issued by the Federation of Accounting Professions, as listed below. Accounting standards: TAS 1 (revised 2009) TAS 2 (revised 2009) TAS 7 (revised 2009) TAS 8 (revised 2009) TAS 10 (revised 2009) TAS 11 (revised 2009) TAS 16 (revised 2009) TAS 17 (revised 2009) TAS 18 (revised 2009) TAS 19 TAS 23 (revised 2009) TAS 24 (revised 2009) TAS 26 TAS 27 (revised 2009) TAS 28 (revised 2009) TAS 29 TAS (revised 2009) TAS 33 (revised 2009) TAS 34 (revised 2009) Presentation of Financial Statements Inventories Statement of Cash Flows Accounting Policies, Changes in Accounting Estimates and Errors Events after the Reporting Period Construction Contracts Property, Plant and Equipment Leases Revenue Employee Benefits Borrowing Costs Related Party Disclosures Accounting and Reporting by Retirement Benefit Plans Consolidated and Separate Financial Statements Investments in Associates Financial Reporting in Hyperinflationary Economies Interests in Joint Ventures Earnings per Share Interim Financial Reporting 17

19 TAS 36 (revised 2009) TAS 37 (revised 2009) TAS 38 (revised 2009) TAS 40 (revised 2009) Impairment of Assets Provisions, Contingent Liabilities and Contingent Assets Intangible Assets Investment Property Financial reporting standards: TFRS 2 Share-Based Payment TFRS 3 (revised 2009) Business Combinations TFRS 5 (revised 2009) Non-current Assets Held for Sale and Discontinued Operations TFRS 6 Exploration for and Evaluation of Mineral Resources Financial Reporting Standard Interpretations: TFRIC 15 Agreements for the Construction of Real Estate Accounting Standard Interpretations: SIC Revenue-Barter Transactions Involving Advertising Services These accounting standards will not have any significant impact on the financial statements for the current period, except for the following accounting standards. TAS 19 Employee Benefits This accounting standard requires employee benefits to be recognised as expense in the period in which the service is performed by the employee. In particular, an entity has to evaluate and make a provision for post-employment benefits using actuarial techniques. The Company and its subsidiaries previously accounted for such employee benefits when they were incurred. The Company has changed this accounting policy in the current year and recognise the liability in the transition period through an adjustment to the beginning balance of retained earnings in the current period. The change will have the effect of decreasing the profit of the Company and its subsidiaries for the three-months and nine-month periods ended September 2011 by Baht 2.2 million ( Baht per share) and Baht 6.4 million ( Baht per share), respectively (Separate financial statements: decreasing profit by Baht 2.2 million ( Baht per share) and Baht 6.4 million ( Baht per share), respectively). The cumulative effect of the changes in the accounting policy has been presented in Note 2. 18

20 1.5 Significant accounting policies The interim financial statements are prepared using the same accounting policies and methods of computation as were used for the financial statements for the year ended December 2010, except for the changes in the following accounting policies due to the adoption of revised and new accounting standards. Employee benefits Post-employment benefits (Defined contribution plans) The Company and its employees have jointly established a provident fund. The fund is monthly contributed by employees and by the Company. The fund s assets are held in a separate trust fund and the Company s contributions are recognised as expenses when incurred. Post-employment benefits (Defined benefit plans) The Company has obligations in respect of the severance payments it must make to employees upon retirement under labor law. The Company treats these severance payment obligations as a defined benefit plan. The obligation under the defined benefit plan is determined by using the projected unit credit method. Such determination is made based on various assumptions, including discount rate, future salary increase rate, staff turnover rate, mortality rate, and inflation rates. For the first-time adoption of TAS 19 Employee Benefits, the Company elected to recognise the transitional liability, which exceeds the liability that would have been recognised at the same date under the previous accounting policy, through an adjustment to the beginning balance of retained earnings in the current period. 2. Cumulative effect of changes in accounting policies due to the adoption of new accounting standards During the current period, the Company made the changes to its significant accounting policies described in Note 1.5, as a result of the adoption of revised and new accounting standards. The cumulative effect of the changes in the accounting policies has been separately presented in the statements of changes in shareholders' equity. 19

21 The amounts of adjustments affecting the statements of financial position as at 1 January 2011 are summarised below. Consolidated financial statement Separate financial statement Statements of financial position Increase in reserve for long-term employee benefits 36,736 36,736 Decreased in unappropriated retained earnings 36,736 36, New accounting standards issued during the period not yet effective During the current period, the Federation of Accounting Professions issued the below listed new accounting standards that are effective for fiscal years beginning on or after 1 January Accounting Standard Interpretations: SIC 10 SIC 21 SIC 25 Government Assistance - No Specific Relation to Operating Activities Income Taxes - Recovery of Revalued Non-Depreciable Assets Income Taxes - Changes in the Tax Status of an Entity or its Shareholders 4. Trade accounts receivable The aging of the outstanding balances of trade accounts receivable - unrelated parties, based on due date, is as follows: Consolidated financial statements Separate financial statements September December September December Age of receivables Not yet due 26,663,020 25,404,771 11,667,607 11,982,154 Past due Less than 1 month 1,7,0 1,397, , , months 234, ,800 8,010 29, months 9, ,937 26,678, months 141, ,217 88,399 43, months 115,929 0,855 53,243 1,241 Over 12 months 674, ,036 33,106 39,063 Total 29,446,511 28,293,783 12,653,282 12,955,671 Less: Allowance for doubtful accounts (366,066) (348,993) (38,439) (42,335) Net 29,080,445 27,944,790 12,614,843 12,913,336 20

22 The aging of the outstanding balances of trade accounts receivable - related parties, based on due date, is as follows: Consolidated financial statements Separate financial statements September December September December Age of receivables Not yet due 1,791, ,535 1,677,297 1,833,782 Past due Less than 1 month 546,544 13, ,119 21, months,637 26,458 36, , months 39, ,654 4, months ,041 3,833 13, months ,6 5,652 Over 12 months ,522 Total 2,409, ,640 2,367,656 2,473,894 Less: Allowance for doubtful accounts (1,234) (2,482) (1,234) (2,482) Net 2,408, ,158 2,366,422 2,471, Related party transactions During the periods, the Company and its subsidiaries had significant business transactions with their overseas related parties. Such transactions are arose in the ordinary course of business and were concluded on commercial terms and bases agreed upon between the Company and those related parties. The relationship between the Company and the related parties are summarised below. Name of related parties Kinpo Electronics, Inc. Logistar International Holding Co., Ltd. Cal-Comp Electronics (Suzhou) Co., Ltd. Cal-Comp Optical Electronics (Suzhou) Co., Ltd. Cal-Comp Electronics & Communications Co., Ltd. Cal-Comp Technology (Suzhou) Co., Ltd. Cal-Comp Electronics and Communications (Suzhou) Co., Ltd. Cal Comp (Malaysia) SDN. BHD. Cal-Comp Precision (Singapore) Limited. Relationship with the Company Major shareholders Subsidiary Subsidiary Subsidiary Subsidiary Subsidiary Subsidiary Subsidiary Subsidiary 21

23 Name of related parties Cal-Comp Electronics (USA) Co., Ltd. Phitronics Industria e Comercio de Electronica e Informatica Ltda. Cal-Comp Electronics de Mexico Co., S.A. de C.V. Avaplas Precision Plastics (Shanghai) Co., Ltd Cal-Comp Precision (Malaysia) Sdn Bhd Cal-Comp Precision (Thailand) Limited Avaplas Precision Plastics (Dongguan) Co., Ltd. Cal-Comp Precision (Wujiang) Co., Ltd. A-Ten Technology Co., Ltd. Wise Sigma International Holding Co., Ltd. Spectragraphics Corporation Co., Ltd. Total Electronics, LLC SMS Technologies, Inc. Telian Corporation Daviscomms (S) Pte Ltd Optosem Technologies (S) Pte Ltd inx Japan International Inc. Zakang Inc. Kinpo Group Management Service Co., Ltd. Kinpo Electronics, Inc. (China) Co., Ltd. Kinpo Electronics (Beijing) Co., Ltd. Kinpo Electronics (Shanghai) Co., Ltd. SaveCom International, Inc. Kinpo International Ltd. Vibo Telecom Co., Ltd. Leading Team Technology Ltd. Acbel Polytech Inc. Crownpo Technology, Inc. Dongguan Kaipo Electronics Co., Ltd. Relationship with the Company Subsidiary Subsidiary Subsidiary Subsidiary (held by a subsidiary) Subsidiary (held by a subsidiary) Subsidiary (held by a subsidiary) Subsidiary (held by a subsidiary) Subsidiary (held by a subsidiary) Associate (held by a subsidiary) Associate (held by a subsidiary) Subsidiary (held by a subsidiary) Subsidiary (held by a subsidiary) Subsidiary (held by a subsidiary) Associate/common directors Associate (held by a subsidiary) Associate (held by a subsidiary) Shareholding by the Company Shareholding by the Company Shareholding by the subsidiary Subsidiary of the major shareholder Subsidiary of the major shareholder Subsidiary of the major shareholder Subsidiary of the major shareholder Common shareholders Common shareholders Common shareholders Common shareholders Common shareholders Common shareholders Such significant transactions are summarised below. For the three-month periods ended September Consolidated financial statements Separate financial statements Transfer Pricing Policy Transactions with subsidiaries (eliminated from the consolidated financial statements) Sales - - 2,112,172 4,008,674 Near market price Purchases of raw materials ,770 5,267 Near market price 22

24 Transactions with related parties For the three-month periods ended September Consolidated financial statements Separate financial statements Transfer Pricing Policy Sales - Kinpo Electronics, Inc. 390,508 2,705,382 84,007 2 Near market price - Kinpo International Ltd. 2,045,274 1,615,566 24,455 23,445 Near market price - Others 2, Near market price Sales of fixed assets At book value Purchases of raw materials 5,510,433 2,741,482 50, ,267 Near market price Purchases of fixed assets 6,297-6,297 - Cost Other expenses 22,211 19, Contract price Interest income % per annum For the nine-month periods ended September Consolidated financial statements Separate financial statements Transfer Pricing Policy Transactions with subsidiaries (Eliminated from consolidated financial statements) Sales - - 6,396,563 12,484,219 Near market price Purchases of raw materials ,137 2,828,056 Near market price Purchases of fixed assets Cost Transactions with related parties Sales - Kinpo Electronics, Inc. 664,733 3,966, ,1 19,484 Near market price - Kinpo International Ltd. 5,497,636 1,898,4 98,0 72,813 Near market price - Others 2,687 9, Near market price Sales of fixed assets 29,093 11, At book value Purchases of raw materials 14,933,299 3,200, ,365 3,361 Near market price Purchases of fixed assets 6,297 4,572 6,297 - Cost Other expenses 61,420 64, Contract price Interest income % per annum The balances of the accounts between the Company and those related companies are as follows: Consolidated Separate financial statements financial statements September December September December Trade accounts receivable - related parties Subsidiaries (eliminated from the consolidated financial statements) - Logistar International Holding Co., Ltd ,117,263 2,422,640 - Cal-Comp Electronics (Suzhou) Co., Ltd

25 Consolidated Separate financial statements financial statements September December September December Cal-Comp Optical Electronics (Suzhou) Co., Ltd , Cal-Comp Electronics & Communications Co., Ltd Cal Comp (Malaysia) SDN. BHD ,832 13,011 - Avaplas Precision Plastics (Dongguan) Co., Ltd , Phitronics Industria e Comercio de Electronica e Informatica Ltda , ,238,323 2,436,958 Related companies - Kinpo Electronics, Inc. 357, ,081 90, Kinpo International Ltd. 2,051,502 4,019 38,556 36,935 - Others 1,228 3, Total 2,409, , ,333 36,936 Less: Allowance for doubtful accounts (1,234) (2,482) (1,234) (2,482) 2,408, , ,099 34,454 2,408, ,158 2,366,422 2,471,412 Short-term loans to related parties Related companies - Wise Sigma International Holding Co., Ltd. 59,807 57, A-Ten Technology Co., Ltd. 66,761 65, Total 126, ,8 - - Less: Allowance for doubtful accounts (122,583) (122,583) - - 3, Amounts due from related parties Subsidiaries (eliminated from consolidated financial statements) - Logistar International Holding Co., Ltd ,667 25,829 - Cal-Comp Electronics (Suzhou) Co., Ltd , Cal-Comp Optical Electronics (Suzhou) Co., Ltd Cal Comp (Malaysia) SDN. BHD ,709 14,653 - Cal-Comp Precision (Singapore) Limited , Cal-Comp Technology (Suzhou) Co., Ltd , Phitronics Industria e Comercio de Electronica e Informatica Ltda , ,764 40,683 Related companies - A-Ten Technology Co., Ltd. 7,843 7, Kinpo Electronics, Inc. 15,436-4, Kinpo International Ltd. 15, , Kinpo Electronics, Inc. (China) Co., Ltd. 2,406 1, Acbel Polytech Inc Other 2, ,967 9,085 21, ,967 9, ,889 41,279 24

26 Consolidated Separate financial statements financial statements September December September December Trade accounts payable - related parties Subsidiaries (eliminated from the consolidated financial statements) - Logistar International Holding Co., Ltd , ,433 - Cal-Comp Electronics (Suzhou) Co., Ltd ,073 - Cal-Comp Precision (Malaysia) Sdn Bhd ,398 - Cal-Comp Precision (Singapore) Limited Cal-Comp Precision (Thailand) Limited , Cal-Comp Electronics and Communications (Suzhou) Co., Ltd Cal Comp (Malaysia) SDN. BHD , ,7 173,640 Related companies - Kinpo Electronics, Inc. 2,169,098 20, Kinpo International Ltd. 4,699 45,706 4,469 45,219 - Kinpo Electronics, Inc. (China) Co., Ltd. 6,336 1,815, Acbel Polytech Inc. 38,211 81,403 38,211 81,403 - Optosem Technologies (S) Pte Ltd 4, Others ,222,674 1,963,124 42, ,684 2,222,674 1,963, ,016 0,324 Advance from and amounts due to related parties Subsidiaries (eliminated from the consolidated financial statements) - Logistar International Holding Co., Ltd ,023 36,485 - Cal-Comp Electronics (Suzhou) Co., Ltd ,657 18,620 - Cal-Comp Optical Electronics (Suzhou) Co., Ltd ,566 8,441 - Cal-Comp Electronics & Communications Co., Ltd Cal Comp (Malaysia) SDN. BHD Cal-Comp Precision (Singapore) Limited ,840 63,646 Related companies - Kinpo Electronics, Inc , ,758 - Kinpo International Ltd , ,706 - Acbel Polytech Inc Dongguan Kaipo Electronics Co., Ltd. 107, ,620 4, , ,620 4,699,643 68,345 25

27 During the period, movements of short-term loans to related parties were as follows: - Consolidated financial statements Balance as at Balance as at 1 January Interest September 2011 Decrease receivable Translation 2011 Short-term loans to related parties Wise Sigma International Holding Co., Ltd. 57, ,927 59,807 A-Ten Technology Co., Ltd. 65,639 (1,060) - 2,182 66, ,8 (1,060) 688 4, ,568 Short-term loans to Wise Sigma International Holding Co., Ltd. were denominated in US dollar currency and interest was charged at the rate of 2% per annum. Net foreign currency assets and liabilities have been included in Note Directors and management benefits During the three-month and nine-month period ended September 2011, the Company and its subsidiaries had salaries, bonuses, meeting allowances, gratuities and long-term employee benefits of their directors and management recognised as expenses totaling Baht 9 million and Baht 28 million, respectively (the Company only: Baht 6 million and Baht 18 million, respectively) (2010: Baht 9 million and Baht 27 million, respectively, the Company only: Baht 6 million and Baht 18 million, respectively). 6. Allowance of diminution in value of inventory Movements in the allowance of diminution in value of inventory account during the nine-month period ended September 2011 are summarised below. Consolidated financial statements Separate financial statements Balance as at 1 January ,959 94,683 Add: Allowance made during the period 7,208 - Less: Allowance reversed during the period (20,261) (762) Balance as at September ,906 93,921 26

28 7. Advances payment for raw materials Included in the balances as at September 2011 and December 2010 mainly consist of: - a) Short-term loans of Baht 95 million ( December 2010: Baht 95 million) provided to local suppliers for use as working capital in agreed production of raw materials, on which interest is charged at the rate of 6.25 percent per annum ( December 2010: 6.25 percent per annum). b) Advance payment of Baht 524 million ( December 2010: Baht 190 million) for the purchase of raw materials and others. c) Advance payment of Baht 141 million to suppliers ( December 2010: Baht 76 million) for the purchase of molds and raw materials. The remaining balances is to be paid upon the completion of molds (please refer to Note 27.5). 8. Other receivables The balances as at September 2011 and December 2010 (net of allowance for doubtful debt of Baht 4.1 million and Baht 2.0 million, respectively) represent suspense accounts receivable set up for the expense can be passed on to customers or vendors and for raw materials which were purchased from suppliers and the inventories to which engineering or component changes have been made. The Company and its subsidiaries set up these suspense accounts while awaiting the return of the raw materials from the creditors. 9. Other current assets The balances as at September 2011 and December 2010 consist of: - Consolidated financial statements Separate financial statements September December September December Receivable - molds 176, ,558 75,257 29,148 Other receivables 77,601 12,033 8,417 1,609 Premiums on hedging of interest rate swap contract 38, Premiums on option contracts - 181, Value added tax 97,815 66,697 3,367 1,640 Others 379, ,970 4,578 10,521 Total 770, ,252 91,619 42,918 27

29 10. Investments in subsidiaries Detail of investments in subsidiaries as presented in separate financial statements are as follows: Shareholding Company's name Paid up capital percentage Cost method September December September December September December % % Logistar International Holding USD.05 USD ,077,604 1,077,604 Co., Ltd. million million Cal-Comp Electronics USD 27.2 USD , ,761 (Suzhou) Co., Ltd. million million Cal-Comp Optical Electronics USD 41.3 USD ,023,834 1,023,834 (Suzhou) Co., Ltd. million million Cal-Comp Electronics & TWD 70 TWD ,510 92,510 Communications Co., Ltd. million million Cal-Comp Technology USD 10 USD , ,541 (Suzhou) Co., Ltd. million million Cal-Comp Electronics USD 35 USD ,125, ,504 and Communications million million (Suzhou) Co., Ltd. Cal-Comp Precision SGD 21 SGD , ,393 (Singapore) Limited. million million Cal Comp (Malaysia) SDN. MYR 28 MYR , ,294 BHD. million million Cal-Comp Electronics (USA) USD 20 USD , ,386 Co., Ltd. million million Phitronics Industria e Comercio USD ,489 - de Electronica e million Informatica Ltda. Cal-Comp Electronics de USD ,124 - Mexico Co., S.A. de C.V. million Total 6,473,429 5,777,827 Less: Allowance for impairment (0,000) (0,000) Net 6,173,429 5,477,827 28