A New Beginning. Menara Takaful Malaysia. Laporan Tahunan 2012 Annual Report

Transcription

1 A New Beginning Menara Malaysia Laporan Tahunan 2012 Annual Report

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3 Isi Kandungan Contents 002 Visi & Misi Vision & Mission 027 Jawatankuasa Pengurusan Management Committee 003 Nilai-nilai Korporat Corporate Values 031 Laporan Jawatankuasa Audit Audit Committee Report Notis Mesyuarat Agung Tahunan ke-28 Notice of 28th Annual General Meeting Penyata Mengiringi Notis Mesyuarat Agung Tahunan ke-28 Statement Accompanying Notice of 28th Annual General Meeting Struktur Korporat Corporate Structure Ringkasan Kewangan Lima Tahun Five Years Financial Highlights Maklumat Korporat Corporate Information Profil Lembaga Pengarah Board of Directors Profile Profil Badan Penasihat Syariah Shariah Advisory Body s Profile Penyata Urus Tadbir Korporat Corporate Governance Statement Maklumat Pematuhan Tambahan Additional Compliance Information Penyata Pengurusan Risiko dan Kawalan Dalaman Statement on Risk Management and Internal Control Penyata Pengerusi Chairman s Statement Penyata Kewangan Financial Statements Maklumat Hartanah Particulars of Properties Statistik Pegangan Saham Shareholdings Statistics Rangkaian Cawangan Branch Network 342 Syarikat Subsidiari Subsidiary Companies Borang Proksi Proxy Form

4 Visi Kami ingin menjadi pilihan utama insurans Vision We want to be the preferred choice for insurance Misi Matlamat kami adalah untuk melangkaui jangkaan pelanggan melalui: Kecemerlangan Operasi Kebolehan Dalam Daya Saing Teknologi Inovasi Produk Budaya Kerja Berorientasikan Prestasi Dalam usaha meningkatkan nilai pemegang-pemegang saham Mission We aim to exceed customers expectations through: Operational Excellence Technology Driven Capabilities Product Innovation Performance Oriented Culture Whilst delivering superior shareholders value

5 Nilai-nilai Korporat Tunggak khusus jenama Malaysia adalah melalui nilai-nilai korporat yang terus diperjuangkan melalui usaha-usaha kami. Corporate Values The defining pillars of the Malaysia brand are the values that we continuously strive to manifest through our work. Memberi Inspirasi Inspiring Kemanusiaan Humanitarian Kerja Berpasukan Teamwork Profesional Professional Integriti Integrity Memberi Inspirasi Ketabahan untuk terus membangunkan industri kami ke tahap yang berikutnya. Profesional Pengorbanan kami adalah melalui pencapaian piawaian dan janji yang kami tunaikan kepada pelanggan kami. Kerja Berpasukan Dedikasi terhadap kerja berpasukan adalah bukti perpaduan dan kepercayaan antara satu sama lain Inspiring Our perseverance to our continued development of our industry, bringing it to the next level. Kemanusiaan Janji kami kepada masyarakat adalah melalui ikrar keprihatinan dan sikap ambil berat. Humanitarian Our promise to the community is the pledge of our compassion and care. Professional Our sacrifice to achieve the standards and promises that we deliver to our customers. Integriti Komitmen kami terhadap nilai-nilai integriti peribadi dan untuk membina kepercayaan. Integrity Our commitment in values of personal integrity and to build trust. Teamwork Our dedication to teamwork is a testament of our unity and trust towards each other.

6 04 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Notis Mesyuarat Agung Tahunan ke-28 Notice of 28 th Annual General Meeting DENGAN INI DIMAKLUMKAN bahawa MESYUARAT AGUNG TAHUNAN SYARIKAT TAKAFUL MALAYSIA BERHAD YANG KEDUA PULUH LAPAN (28) akan diadakan di Ballroom 1, Tingkat 1, Pusat Konvensyen Sime Darby, 1A Jalan Bukit Kiara 1, Kuala Lumpur pada hari Isnin, 29 April 2013, jam 10:00 pagi bagi tujuan-tujuan berikut: NOTICE IS HEREBY GIVEN that the TWENTY EIGHT (28TH) ANNUAL GENERAL MEETING of SYARIKAT TAKAFUL MALAYSIA BERHAD will be held at Ballroom 1, Level 1, Sime Darby Convention Centre, 1A Jalan Bukit Kiara 1, Kuala Lumpur on Monday, 29 April 2013, at 10:00 a.m. for the following purposes: SEBAGAI URUSAN BIASA 1. Untuk menerima Penyata-penyata Kewangan Beraudit bagi tahun kewangan berakhir 31 Disember 2012, berserta laporan Pengarah dan Juruaudit berkaitan dengannya. (Resolusi 1) AS ORDINARY BUSINESS 1. To receive the Audited Financial Statements for the financial year ended 31 December 2012, together with the reports of the Directors and Auditors thereon. (Resolution 1) 2. Untuk melantik semula Pengarah-pengarah berikut yang bersara menurut Tataurusan Pertubuhan Syarikat: Artikel Encik Mahadzir Azizan (Resolusi 2) 2.2 Y. Bhg. Dato Sulaiman Mohd Yusof (Resolusi 3) 2.3 Encik Zakaria Ismail (Resolusi 4) Artikel 66A 2.4 Y. Bhg. Dato Othman Abdullah (Resolusi 5) 2. To re-elect the following Directors, each of whom retires pursuant to the Company s Articles of Association: Article Encik Mahadzir Azizan (Resolution 2) 2.2 Y. Bhg. Dato Sulaiman Mohd Yusof (Resolution 3) 2.3 Encik Zakaria Ismail (Resolution 4) Article 66A 2.4 Y. Bhg. Dato Othman Abdullah (Resolution 5) 3. Untuk meluluskan bayaran yuran Pengarah-pengarah sebanyak RM783,000 bagi tahun kewangan berakhir 31 Disember (RM579,000 bagi tahun kewangan berakhir 31 Disember 2011). (Resolusi 6) 4. Untuk meluluskan bayaran yuran Ahli-ahli Badan Penasihat Syariah sebanyak RM193,000 bagi tahun kewangan berakhir 31 Disember (RM167,000 bagi tahun kewangan berakhir 31 Disember 2011). (Resolusi 7) 5. Untuk melantik semula Tetuan KPMG Desa Megat & Co. sebagai Juruaudit Syarikat dan memberi kuasa kepada Pengarah-pengarah untuk menetapkan bayaran Juruaudit. (Resolusi 8) 3. To approve the payment of the Directors fees of RM783,000 for the financial year ended 31 December (RM579,000 for the financial year ended 31 December 2011). (Resolution 6) 4. To approve the payment of Shariah Advisory Body Members fees of RM193,000 for the financial year ended 31 December (RM167,000 for the financial year ended 31 December 2011). (Resolution 7) 5. To re-appoint Messrs KPMG Desa Megat & Co. as the Auditors of the Company and to authorise the Directors to fix their remuneration. (Resolution 8)

7 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 05 Notis Mesyuarat Agung Tahunan ke-28 Notice of 28 th Annual General Meeting SEBAGAI URUSAN KHAS AS SPECIAL BUSINESS 6. Resolusi Biasa Cadangan Mandat Pemegang-pemegang Saham bagi Urusniaga-urusniaga yang Berulang dengan Pihak Berkaitan Berbentuk Hasil atau Perdagangan dengan BIMB Holdings Berhad dan subsidiari-subsidiarinya ( Kumpulan BHB ). BAHAWA, tertakluk kepada pematuhan dengan Keperluan Penyenaraian Bursa Malaysia Securities Berhad, Akta Syarikat 1965, Memorandum dan Tataurusan Pertubuhan Syarikat dan semua undang-undang, peraturan dan garis panduan yang berkaitan, kelulusan dengan ini diberikan kepada Syarikat dan subsidiari-subsidiarinya ( Kumpulan Malaysia ) untuk memeterai Urusniaga-urusniaga yang Berulang dengan Pihak Berkaitan Berbentuk Hasil atau Perdagangan dengan Kumpulan BHB yang perlu bagi operasi harian Kumpulan Malaysia seperti yang dinyatakan dalam Seksyen 2.3 Pekeliling kepada Para Pemegang Saham bertarikh 5 April 2013 ( Pekeliling ), dengan syarat bahawa: (a) urusniaga tersebut adalah dalam urusan biasa perniagaan dan mengikut terma yang tidak lebih memihak kepada pihak berkaitan berbanding yang secara umumnya tersedia kepada orang ramai dan mengikut terma yang tidak menjejaskan para pemegang saham minoriti Syarikat; (b) urusniaga dilaksanakan secara tulus dan mengikut terma komersial biasa; dan (c) penzahiran akan dibuat dalam laporan tahunan dengan pecahan nilai agregat urus niaga yang dijalankan menurut mandat pada tahun kewangan. DAN BAHAWA kelulusan tersebut akan bermula serta-merta setelah resolusi ini diluluskan dan akan terus berkuatkuasa sehingga: (a) tamat mesyuarat agung tahunan Syarikat yang akan datang, di mana mandat tersebut akan luput, melainkan kuasa tersebut diperbaharui melalui satu resolusi yang diluluskan dalam mesyuarat tersebut; (b) tamat tempoh di mana mesyuarat agung tahunan berikutnya selepas tarikh ia dikehendaki untuk diadakan menurut Seksyen 143(1) Akta Syarikat, 1965 ( AS ) (tetapi tidak melebihi penangguhan seperti yang dibenarkan menurut Seksyen 143(2) AS); atau 6. Ordinary Resolution Proposed Shareholders Mandate for Recurrent Related Party Transactions of a Revenue or Trading Nature with BIMB Holdings Berhad and its Subsidiaries ( BHB Group ). THAT, subject to compliance with the Listing Requirements of Bursa Malaysia Securities Berhad, Companies Act 1965, Memorandum and Articles of Association of the Company and all other applicable laws, rules, regulations and guidelines, approval be and is hereby given to the Company and its subsidiaries ( Malaysia Group ) to enter into the Recurrent Related Party Transactions of a revenue or trading nature with the BHB Group which are necessary for the day to day operations of the Malaysia Group as set out in Section 2.3 of the Circular to Shareholders dated 5 April 2013 ( Circular ), provided that: (a) the transactions are in the ordinary course of business and are on terms which are not more favourable to the related parties than those generally available to the public and on terms not to the detriment of the minority shareholders of the Company; (b) the transactions are made at arm s length and on normal commercial terms; and (c) the disclosure will be made in the annual report with the breakdown of the aggregate value of the transactions conducted pursuant to the mandate during the financial year. AND THAT such authority shall commence immediately upon the passing of this resolution and shall continue to be in force until: (a) the conclusion of the next annual general meeting of the Company, at which time it will lapse, unless by a resolution passed at the meeting, the authority is renewed; (b) the expiration of the period within which the next annual general meeting after the date that it is required to be held pursuant to Section 143(1) of the Companies Act, 1965 ( CA ) (but shall not extend to such extension as may be allowed pursuant to Section 143(2) of CA); or

8 06 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Notis Mesyuarat Agung Tahunan ke-28 Notice of 28 th Annual General Meeting (c) dibatalkan atau dipinda melalui resolusi yang diluluskan oleh pemegang saham dalam mesyuarat agung, (c) revoked or varied by resolution passed by the shareholders in a general meeting, yang mana lebih awal. (Resolusi 9) 7. Untuk melaksanakan sebarang urusan yang mana notis sewajarnya telah diberi. NOTIS SETERUSNYA DENGAN INI DIBERI BAHAWA untuk tujuan menentukan ahli yang akan layak untuk menghadiri AGM yang ke-28, Syarikat akan membuat permohonan kepada Bursa Malaysia Depository Sdn Bhd, selaras dengan Artikel 41(f)(ii) Tataurusan Pertubuhan Syarikat dan Seksyen 34(1) Akta Perindustrian Sekuriti (Depositori Pusat) 1991, untuk menerbitkan Rekod Pendeposit Mesyuarat Agung pada 22 April Hanya pendeposit yang namanya tersenarai di dalam Rekod Pendeposit pada 22 April 2013 sahaja berhak untuk menghadiri mesyuarat atau melantik proksi untuk menghadiri dan/atau mengundi bagi pihaknya. whichever is the earlier. (Resolution 9) 7. To transact any other business for which due notice has been given. FURTHER NOTICE IS HEREBY GIVEN THAT for the purpose of determining a member who shall be entitled to attend this 28th AGM, the Company shall be requesting Bursa Malaysia Depository Sdn Bhd, in accordance with Article 41(f )(ii) of the Company s Articles of Association and Section 34(1) of the Securities Industry (Central Depositories) Act 1991, to issue a General Meeting Record of Depositors as at 22 April Only a depositor whose name appears on the Record of Depositors as at 22 April 2013 shall be entitled to attend the said meeting or appoint proxies to attend and/or vote on his/her behalf. Atas Arahan Lembaga Pengarah MOHAMAD ASRI HAJI YUSOFF (MIA 14171) Setiausaha Syarikat Kuala Lumpur 5 April 2013 By Order of the Board MOHAMAD ASRI HAJI YUSOFF (MIA 14171) Company Secretary Kuala Lumpur 5 April 2013

9 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 07 Notis Mesyuarat Agung Tahunan ke-28 Notice of 28 th Annual General Meeting Nota-Nota: 1. Pelantikan Proksi Notes: 1. Appointment of Proxy (i) Seorang ahli yang berhak hadir untuk mengundi dalam mesyuarat itu layak untuk melantik tidak lebih daripada dua (2) orang proksi untuk hadir dan mengundi bagi pihaknya dan haruslah menyatakan bahagian sahamnya yang diwakili oleh setiap proksi dan proksi itu tidak semestinya seorang ahli Syarikat. (i) A member entitled to attend and vote at the meeting is entitled to appoint not more than two (2) proxies to attend and to vote instead of him and shall specify the proportions of his holdings to be represented by each proxy and a proxy need not be a member of the Company. (ii) (iii) Suratcara pelantikan proksi bagi individu hendaklah ditandatangani oleh pelantik atau peguamnya dan dalam hal perbadanan, ia mestilah dimeterai atau ditandatangani oleh seorang pegawai atau peguamnya yang telah diberi kuasa sewajarnya. Suratcara pelantikan seorang proksi mestilah dihantar ke Pejabat Berdaftar Syarikat di Tingkat 26, Blok Annex, Menara Malaysia, No. 4, Jalan Sultan Sulaiman, Kuala Lumpur, tidak lewat dari empat puluh lapan (48) jam sebelum waktu yang ditetapkan bagi mengadakan mesyuarat atau sebarang penangguhannya. (iv) Hanya ahli yang tersenarai di dalam Rekod Pendeposit pada 22 April 2013 yang layak untuk hadir, bersuara dan mengundi pada AGM atau melantik seorang proksi (proksi-proksi) untuk hadir, bersuara dan/atau mengundi bagi pihak mereka. 2. Nota Penerangan Kepada Urusniaga Khas (i) Cadangan Mandat Pemegang-pemegang Saham bagi Urusniagaurusniaga yang Berulang dengan Pihak Berkaitan Berbentuk Hasil atau Perdagangan Cadangan Resolusi No. 9, jika diluluskan, akan memberi kuasa kepada Syarikat untuk melaksanakan Urusniaga-urusniaga yang Berulang dengan Pihak Berkaitan Berbentuk Hasil atau Perdagangan yang perlu bagi operasi harian Kumpulan Malaysia dan akan menghapuskan keperluan untuk menjalankan mesyuarat agung yang berasingan dari masa ke semasa untuk mendapatkan kelulusan para pemegang saham. Butiran Cadangan Mandat Pemegangpemegang Saham bagi Urusniaga-urusniaga yang Berulang dengan Pihak Berkaitan Berbentuk Hasil atau Perdagangan ada dinyatakan di dalam Pekeliling kepada Pemegang Saham bertarikh 5 April (ii) The instrument appointing a proxy in the case of an individual shall be signed by the appointer or his attorney and in the case of a corporation, must be under seal or under the hand of an officer or attorney duly authorised. (iii) The instrument appointing a proxy must be deposited at the Registered Office of the Company at Tingkat 26, Blok Annex, Menara Malaysia, No. 4, Jalan Sultan Sulaiman, Kuala Lumpur not less than forty eight (48) hours before the time for holding the meeting or any adjournment thereof. (iv) Only members whose names appear in the Record of Depositors on 22 April 2013 shall be eligible to attend, speak and vote at the AGM or appoint proxy(ies) to attend, speak and/or vote on their behalf. 2. Explanatory Note on Special Business (i) Proposed Shareholders Mandate for Recurrent Related Party Transaction of a Revenue or Trading Nature The proposed Resolution No. 9, if passed, will empower the Company to conduct recurrent related party transactions of a revenue or trading in nature which are necessary for Malaysia Group s day to day operations and will eliminate the need to convene separate general meetings from time to time to seek shareholders approval. The details on the Proposed Shareholders Mandate for Recurrent Related Party Transactions of a Revenue or Trading Nature are set out in the Circular to Shareholders dated 5 April 2013.

10 08 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Penyata Mengiringi Notis Mesyuarat Agung Tahunan Kedua Puluh Lapan mengikut Perenggan 8.27 (2) Keperluan Penyenaraian Pasaran Utama Bursa Malaysia Securities Berhad Tiada individu yang dilantik sebagai Pengarah (selain daripada pengarah yang bersedia untuk dilantik semula iaitu Encik Mahadzir Azizan, Y. Bhg. Dato Sulaiman Mohd Yusof, Encik Zakaria Ismail dan Y. Bhg. Dato Othman Abdullah) dalam Mesyuarat Agung Tahunan Syarikat Malaysia Berhad yang Kedua Puluh Lapan akan datang. Statement Accompanying Notice of Twenty Eight Annual General Meeting pursuant to Paragraph 8.27 (2) of the Main Market Listing Requirements of Bursa Malaysia Securities Berhad There is no individual standing for election as Director (other than directors standing for re-election i.e. Encik Mahadzir Azizan, Y. Bhg. Dato Sulaiman Mohd Yusof, Encik Zakaria Ismail and Y. Bhg. Dato Othman Abdullah) at this forthcoming Twenty Eight Annual General Meeting of Syarikat Malaysia Berhad.

11 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 09 Struktur Korporat Corporate Structure Syarikat-Syarikat Subsidiari / Subsidiary Companies 56.00% 63.09% P.T. SYARIKAT * 52.67% 57.24% 42.73% 47.08% * in members voluntary liquidation

12 010 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Ringkasan Kewangan Lima Tahun 5 Years Financial Highlights Jumlah Kasar Sumbangan () / Total Gross Contributions () Keluarga / Family Kumpulan / Group Syarikat / Company , , , , * 839, * 679, , , , ,711 Am / General Kumpulan / Group Syarikat / Company , , , , * 606, * 499, , , , ,547 Jumlah Aset () / Total Assets () Kumpulan / Group Syarikat / Company ,047, ,796, ,614, ,306, * 5,366, * 4,966, ,845, ,440, ,371, ,963,150

13 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 011 Ringkasan Kewangan Lima Tahun 5 Years Financial Highlights Keuntungan Sebelum Cukai Selepas Zakat () / Profit Before Taxation After Zakat () Kumpulan / Group Syarikat / Company , , , , * 97, * 92, , , , ,031 Pulangan atas Ekuiti (%) / Return on Equity (%) Dividen yang Dibayar/Dicadangkan (Ditolak Cukai) ()/ Dividend Paid/Proposed (Net of Taxation) () Kumpulan / Group Syarikat / Company , , * * 17, , ,704 Aset Bersih Sesaham (RM) / Net Assets Per Share (RM) Kumpulan / Group Pendapatan Sesaham (RM) / Earnings Per Share (RM) Kumpulan / Group * * * 18 months financial period

14 012 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Maklumat Korporat Corporate Information LEMBAGA PENGARAH / BOARD OF DIRECTORS Pengerusi / Chairman Y. Bhg. Dato Paduka Ismee Ismail Pengarah Bukan Eksekutif Bukan Bebas / Non-Independent Non-Executive Director Ahli-ahli / Members Y. Bhg. Dato Mohamed Hassan Md. Kamil Pengarah Urusan Kumpulan / Group Managing Director Puan Rozaida Omar Pengarah Bukan Eksekutif Bukan Bebas / Non-Independent Non-Executive Director Encik Mahadzir Azizan Pengarah Bukan Eksekutif Bebas Kanan / Senior Independent Non-Executive Director Y. Bhg. Dato Sulaiman Mohd Yusof Pengarah Bukan Eksekutif Bebas / Independent Non-Executive Director Encik Johan Abdullah Pengarah Bukan Eksekutif Bukan Bebas / Non-Independent Non-Executive Director Encik Zakaria Ismail Pengarah Bukan Eksekutif Bebas / Independent Non-Executive Director Y. Bhg. Dato Othman Abdullah Pengarah Bukan Eksekutif Bebas / Independent Non-Executive Director (Dilantik pada 1 Disember 2012 / Appointed on 1 December 2012) Setiausaha / Secretary Encik Mohamad Asri Haji Yusoff (MIA 14171) BADAN PENASIHAT SYARIAH / SHARIAH ADVISORY BODY Pengerusi / Chairman Y. Bhg. Dr. Ahmad Sobri Salamon Ahli-ahli / Members Y. Bhg. Ustaz Mohd. Bakir Hj. Mansor Y. Bhg. Dr. Aida Othman Y. Bhg. Prof. Madya Dr. Muhamad Rahimi Osman Y. Bhg. Dato Wan Mohamad Dato Sheikh Abdul Aziz Setiausaha / Secretary Encik Mohamad Asri Haji Yusoff JAWATANKUASA AUDIT / AUDIT COMMITTEE Encik Mahadzir Azizan Pengerusi / Chairman Puan Rozaida Omar (Meletak jawatan pada 1 Disember 2012/ Resigned on 1 December 2012) Y. Bhg. Dato Sulaiman Mohd Yusof Encik Zakaria Ismail Y. Bhg. Dato Othman Abdullah (Dilantik pada 1 Disember 2012/ Appointed on 1 December 2012) JAWATANKUASA PEMILIHAN / NOMINATION COMMITTEE Encik Mahadzir Azizan Pengerusi / Chairman (Pengerusi mulai 23 Mei 2012/ Chairman from 23 May 2012) Encik Zakaria Ismail (Pengerusi sehingga 22 Mei 2012/ Chairman until 22 May 2012) Puan Rozaida Omar Y. Bhg. Dato Sulaiman Mohd Yusof Encik Johan Abdullah JAWATANKUASA GANJARAN / REMUNERATION COMMITTEE Encik Zakaria Ismail Pengerusi / Chairman (Pengerusi mulai 23 Mei 2012/ Chairman from 23 May 2012) Encik Mahadzir Azizan (Pengerusi sehingga 22 Mei 2012/ Chairman until 22 May 2012) Encik Johan Abdullah JAWATANKUASA Risiko LEMBAGA PENGARAH / BOARD RISK COMMITTEE Encik Zakaria Ismail Pengerusi / Chairman Encik Mahadzir Azizan Encik Johan Abdullah Y. Bhg. Dato Sulaiman Mohd Yusof

15 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 013 Maklumat Korporat Corporate Information PENGURUSAN / MANAGEMENT Y. Bhg. Dato Mohamed Hassan Md. Kamil Pengarah Urusan Kumpulan / Group Managing Director Encik Lee Hin Sze Ketua Pegawai Kewangan / Chief Financial Officer Puan Azian Kassim Ketua Pegawai Pelaburan / Chief Investment Officer Encik Nazrul Hisham Abdul Hamid Pengurus Besar, Operasi / General Manager, Operations Encik Leem Why Chong Pengurus Besar, Aktuari & Aktuari Dilantik / General Manager, Actuarial & Appointed Actuary Puan Norazlin Mohd Dahari Pengurus Besar, Jualan Korporat / General Manager, Corporate Sales Encik Mohd Suhaimi Ahmad Pengurus Besar, Agensi Runcit / General Manager, Retail Agency Puan Shuhaibahtulaslamiah Hurmuzan Pengurus Besar, Sumber Manusia / General Manager, Human Resource Encik Patrick Wong Chang Yang Ketua Pegawai Informasi / Chief Information Officer Encik Mark Anthony Nathan Pengurus Besar, Bankatakaful / General Manager, Bancatakaful Cik Leong Chee Wan Penolong Pengurus Besar, Operasi Keluarga / Bankatakaful / Logistik Assistant General Manager, Operations Family / Bancatakaful / Logistic Puan Haniza Filzah Hayani Abu Haniffa Penolong Pengurus Besar, Audit Dalaman / Assistant General Manager, Internal Audit Encik Wahizan Abdul Wahid Penolong Pengurus Besar, Pematuhan & Pengurusan Risiko / Assistant General Manager, Compliance & Risk Management Puan Mala Patmarajah Ketua, Komunikasi Korporat / Head of Corporate Communications JURUAUDIT / AUDITORS KPMG Desa Megat & Co. (AF0759) Chartered Accountants Level 10, KPMG Tower 8, First Avenue Bandar Utama Petaling Jaya Selangor Darul Ehsan Tel : Fax : PEJABAT BERDAFTAR / REGISTERED OFFICE Tingkat 26, Blok Annex Menara Malaysia No. 4, Jalan Sultan Sulaiman Kuala Lumpur Tel : Fax : csu@takaful-malaysia.com.my Website : takaful-malaysia.com.my PENDAFTAR / REGISTRAR Symphony Share Registrars Sdn Bhd ( D) Level 6, Symphony House Pusat Dagangan Dana 1 Jalan PJU 1A/ Petaling Jaya Selangor Tel : Fax : /52 Helpdesk Line : Website : TEMPAT DITUBUHKAN DAN DOMISIL / PLACE OF INCORPORATION AND DOMICILE Malaysia PENYENARAIAN BURSA / BURSA LISTING Pasaran Utama / Main Market Bursa Malaysia Securities Berhad

16 014 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Profil Lembaga Pengarah Board of Directors Profile Pengerusi / Chairman Y. Bhg. Dato Paduka Ismee Ismail, berusia 48 tahun, adalah warganegara Malaysia dan telah dilantik sebagai Pengerusi Bukan Eksekutif Bukan Bebas Malaysia pada 16 Disember Y. Bhg. Dato Paduka Ismee Ismail, aged 48, is a Malaysian citizen and was appointed to the Board on 16 December 2009 as a Non- Independent Non-Executive Chairman of Malaysia. Y. Bhg. Dato Paduka Ismee Ismail Beliau adalah ahli fellow Chartered Institute of Management Accountants (CIMA) dan ahli Institut Akauntan Malaysia (MIA). Beliau kini merupakan Pengarah Urusan Kumpulan dan Ketua Pegawai Eksekutif Lembaga Tabung Haji. Sebelum itu, beliau merupakan Ketua Pegawai Eksekutif ECM Libra Securities Sdn Bhd dan Pengarah ECM Libra Capital Sdn Bhd. Beliau juga pernah berkhidmat dengan beberapa organisasi dalam pelbagai kapasiti antaranya selaku Pengurus Besar Kanan Kewangan, Lembaga Tabung Haji; Ketua Akauntan di Pengurusan Danaharta Nasional Berhad; Pengurus Besar Pembangunan Perniagaan di Arab Malaysian Development Berhad dan beberapa jawatan berkaitan kewangan di Shell Malaysia Trading Sdn Bhd. Beliau juga adalah Pengarah BIMB Holdings Berhad, Bank Islam Malaysia Berhad, TH Plantations Berhad, Felda Global Ventures Holdings Berhad dan beberapa syarikat lain. Beliau tidak mempunyai perhubungan kekeluargaan dengan manamana pengarah/pemegang saham utama Malaysia dan tidak mempunyai percanggahan kepentingan dengan Malaysia. Beliau tidak pernah disabitkan dengan apa-apa kesalahan dalam tempoh sepuluh (10) tahun yang lalu dan telah menghadiri kesemua lapan (8) mesyuarat Lembaga Pengarah yang diadakan dalam tahun kewangan berakhir 31 Disember He is a fellow member of Chartered Institute of Management Accountants (CIMA) and a member of the Malaysian Institute of Accountants (MIA). He is currently the Group Managing Director and Chief Executive Officer of Lembaga Tabung Haji. Prior to that, he was the Chief Executive Officer of ECM Libra Securities Sdn Bhd and a Director of ECM Libra Capital Sdn Bhd. He has also served several organisations in various capacities including that of Senior General Manager of Finance, Lembaga Tabung Haji; Chief Accountant at Pengurusan Danaharta Nasional Berhad; General Manager of Business Development at Arab Malaysian Development Berhad and has held several finance-related positions at Shell Malaysia Trading Sdn Bhd. He is also a Director of BIMB Holdings Berhad, Bank Islam Malaysia Berhad, TH Plantations Berhad, Felda Global Ventures Holdings Berhad and several other companies. He has no family relationship with any other directors/major shareholders of Malaysia and has no conflict of interest with Malaysia. He has no conviction for offences within the past ten (10) years and has attended all eight (8) Board of Directors meetings held during the financial year ended 31 December 2012.

17 Syarikat Malaysia Berhad ( K) 015 Profil Lembaga Pengarah Laporan Tahunan 2012 Annual Report Board of Directors Profile Pengarah Urusan Kumpulan / Group Managing Director Y. Bhg. Dato Mohamed Hassan Md. Kamil, berusia 50 tahun, adalah warganegara Malaysia dan dilantik ke Lembaga Pengarah Malaysia pada 1 September 2006 sebagai Pengarah Bukan Eksekutif Bukan Bebas. Beliau kini adalah Pengarah Urusan Kumpulan bagi Malaysia sejak 1 April Beliau juga merupakan Pengerusi Lembaga Komisaris P.T. Syarikat Indonesia dan P.T. Asuransi keluarga. Y. Bhg. Dato Mohamed Hassan Md. Kamil, aged 50, is a Malaysian citizen and was appointed to the Board of Malaysia on 1 September 2006 as a Non-Independent Non-Executive Director. He is currently the Group Managing Director of Malaysia since 1 April He is also the Chairman of the Board of Commissioners of P.T. Syarikat Indonesia and P.T. Asuransi Keluarga. Y. Bhg. Dato Mohamed Hassan Md. Kamil Beliau merupakan graduan Sarjana Muda Sains dalam bidang Sains Aktuari dan Sarjana Pentadbiran Perniagaan dari University of Iowa, USA. Beliau juga adalah Fellow of the Society of Actuaries, USA, ahli American Academy of Actuaries dan Chartered Life Underwriter. Beliau telah bekerja di Amerika Syarikat sebagai Aktuari dari tahun 1987 hingga 1994 sebelum pulang ke Malaysia sebagai Timbalan Pengurus Besar di Malaysia National Insurance. Pada tahun 1996, beliau menyertai ING Insurance Berhad (sebelum ini dikenali sebagai Aetna Universal Insurance) sebagai Naib Presiden Kanan dan Ketua Aktuari. Pada tahun 2004, beliau menjadi Timbalan Pengurus Besar bagi P.T. AIA Indonesia. Beliau tidak mempunyai perhubungan kekeluargaan dengan mana-mana pengarah/pemegang saham utama Malaysia dan tidak mempunyai percanggahan kepentingan dengan Malaysia. Beliau tidak pernah disabitkan dengan apa-apa kesalahan dalam tempoh sepuluh (10) tahun yang lalu dan telah menghadiri kesemua lapan (8) mesyuarat Lembaga Pengarah yang diadakan dalam tahun kewangan berakhir 31 Disember He graduated with a Bachelor of Science degree in Actuarial Science and Master in Business Administration from the University of Iowa, USA. He is a Fellow of the Society of Actuaries, USA, a member of the American Academy of Actuaries and a Chartered Life Underwriter. He worked in the United States as an Actuary from 1987 to 1994 prior to returning to Malaysia as Deputy General Manager at Malaysia National Insurance. In 1996, he joined ING Insurance Berhad (previously known as Aetna Universal Insurance) as Senior Vice President and Chief Actuary. In 2004, he became the Deputy General Manager for P.T. AIA Indonesia. He has no family relationship with any other directors/major shareholders of Malaysia and has no conflict of interest with Malaysia. He has no conviction for offences within the past ten (10) years and has attended all eight (8) Board of Directors meetings held during the financial year ended 31 December 2012.

18 016 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Profil Lembaga Pengarah Board of Directors Profile Pengarah Bukan Eksekutif Bukan Bebas / Non-Independent Non-Executive Director Puan Rozaida Omar, berusia 50 tahun, adalah warganegara Malaysia dan telah dilantik sebagai Pengarah Bukan Eksekutif Bukan Bebas Malaysia pada 15 Mei Beliau juga merupakan ahli Jawatankuasa Pemilihan. Puan Rozaida Omar, aged 50, is a Malaysian citizen and is a Non-Independent Non-Executive Director of Malaysia and was appointed to the Board on 15 May She is also a member of the Nomination Committee. Puan Rozaida Omar Beliau adalah Akauntan Bertauliah (M) dan merupakan ahli Association of Chartered Certified Accountants (ACCA) United Kingdom sejak tahun Beliau memulakan kerjayanya sebagai Akauntan Kewangan di FELDA pada tahun Pada tahun 1990, beliau menjadi Pengurus Kredit di Citibank Berhad sehingga tahun Beliau kemudiannya menyertai Guthrie Trading Sdn Bhd pada tahun 1992 sebagai Pengurus Kewangan sehingga tahun Selepas itu, beliau menjadi Pengarah Kewangan di Glaxo SmithKline Consumer Healthcare Sdn Bhd dari tahun 1994 sehingga tahun Kini beliau adalah Ketua Pegawai Kewangan Kumpulan di Lembaga Tabung Haji sejak tahun Beliau juga merupakan Pengarah Pelikan International Corporation Berhad dan BIMB Holdings Berhad. Beliau tidak mempunyai perhubungan kekeluargaan dengan mana-mana pengarah/pemegang saham utama Malaysia dan tidak mempunyai percanggahan kepentingan dengan Malaysia. Beliau tidak pernah disabitkan dengan apa-apa kesalahan dalam tempoh sepuluh (10) tahun yang lalu dan telah menghadiri tujuh (7) mesyuarat Lembaga Pengarah yang diadakan dalam tahun kewangan berakhir 31 Disember She is a Chartered Accountant (M) and a member of the Association of Chartered Certified Accountants (ACCA) United Kingdom since She started her career as a Financial Accountant at FELDA in In 1990, she became a Credit Manager at Citibank Berhad until She then joined Guthrie Trading Sdn Bhd in 1992 as a Finance Manager until After that, she became a Finance Director of Glaxo SmithKline Consumer Healthcare Sdn Bhd from 1994 until She is currently the Group Chief Financial Officer of Lembaga Tabung Haji since She is also a Director of Pelikan International Corporation Berhad and BIMB Holdings Berhad. She has no family relationship with any other directors/major shareholders of Malaysia and has no conflict of interest with Malaysia. She has no conviction for offences within the past ten (10) years and has attended seven (7) Board of Directors meetings held during the financial year ended 31 December 2012.

19 Syarikat Malaysia Berhad ( K) 017 Profil Lembaga Pengarah Laporan Tahunan 2012 Annual Report Board of Directors Profile Pengarah Bukan Eksekutif Bebas Kanan / Senior Independent Non-Executive Director Encik Mahadzir Azizan, berusia 64 tahun, adalah warganegara Malaysia yang telah dilantik sebagai Pengarah Bukan Eksekutif Bebas Malaysia pada 1 September Beliau telah dilantik sebagai Pengarah Bukan Eksekutif Bebas Kanan pada 2 Jun Encik Mahadzir Azizan, aged 64, is a Malaysian citizen and is an Independent Non-Executive Director of Malaysia who was appointed to the Board on 1 September He was appointed as Senior Independent Non-Executive Director on 2 June Encik Mahadzir Azizan Beliau juga merupakan Pengerusi Jawatankuasa Audit dan Jawatankuasa Pemilihan dan ahli Jawatankuasa Risiko Lembaga Pengarah dan Jawatankuasa Ganjaran. Beliau juga merupakan ahli Lembaga Komisaris P. T. Asuransi Keluarga. Beliau memperolehi kelulusan Barrister-At-Law dari Lincoln s Inn, London, United Kingdom dan diterima masuk ke English Bar pada tahun Beliau telah memegang pelbagai jawatan penting di dalam sektor awam dan swasta. Selepas tamat pengajian, beliau telah menyertai perkhidmatan Perundangan dan Kehakiman Kerajaan Malaysia sebagai Timbalan Pendakwaraya dan Penasihat Undang-Undang. Beliau kemudiannya menyertai sektor swasta dan berkhidmat di Malaysian International Shipping Corporation ( MISC ) dan Island & Peninsular Berhad, syarikat hartanah Permodalan Nasional Berhad ( PNB ) selama 24 tahun. Semasa di sektor swasta, beliau juga telah berkhidmat sebagai Ahli Majlis MARA dan juga sebagai Pengarah di pelbagai syarikat berkaitan Kerajaan. Kini, beliau juga merupakan Pengarah ECM Libra Financial Group Berhad, Libra Invest Berhad dan beberapa syarikat lain. Beliau tidak mempunyai perhubungan kekeluargaan dengan manamana pengarah/pemegang saham utama Malaysia dan tidak mempunyai percanggahan kepentingan dengan Malaysia. Beliau tidak pernah disabitkan dengan apa-apa kesalahan dalam tempoh sepuluh (10) tahun yang lalu dan telah menghadiri kesemua lapan (8) mesyuarat Lembaga Pengarah yang diadakan dalam tahun kewangan berakhir 31 Disember He is the also Chairman of the Audit Committee and Nomination Committee and a member of Board Risk Committee and Remuneration Committee. He is also a member of the Board of Commissioners of P.T. Asuransi Keluarga. He is a Barrister-At-Law from Lincoln s Inn, London, United Kingdom and was called to the English Bar in He has held key positions both in private and public sector. After graduation, he joined the Judicial and Legal Service of the Malaysian Government as a Deputy Public Prosecutor and Federal Counsel and subsequently ventured into the private sector and served Malaysian International Shipping Corporation ( MISC ) and Island & Peninsular Berhad, the property arm of Permodalan Nasional Berhad ( PNB ) for 24 years. Whilst in the private sector, he also served as Ahli Majlis MARA as well as various other directorships in government linked companies. Currently, he is also a Director of ECM Libra Financial Group Berhad, Libra Invest Berhad and several other companies. He has no family relationship with any other directors/major shareholders of Malaysia and has no conflict of interest with Malaysia. He has no conviction for offences within the past ten (10) years and has attended all eight (8) Board of Directors meetings held during the financial year ended 31 December 2012.

20 018 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Profil Lembaga Pengarah Board of Directors Profile Pengarah Bukan Eksekutif Bebas / Independent Non-Executive Director Y. Bhg. Dato Sulaiman Mohd Yusof, berusia 62 tahun, adalah warganegara Malaysia dan telah dilantik sebagai Pengarah Bukan Eksekutif Bebas Malaysia pada 1 Januari Beliau juga merupakan ahli Jawatankuasa Audit, Jawatankuasa Pemilihan dan Jawatankuasa Risiko Lembaga Pengarah. Beliau juga merupakan Pengerusi Asean Retakaful International (L) Ltd. (dalam pembubaran secara sukarela oleh ahli). Y. Bhg. Dato Sulaiman Mohd Yusof, aged 62, is a Malaysian citizen and is an Independent Non-Executive Director of Malaysia and was appointed to the Board on 1 January He is also a member of the Audit Committee, Nomination Committee and Board Risk Committee. He is also the Chairman of Asean Retakaful International (L) Ltd. (in members voluntary liquidation). Y. Bhg. Dato Sulaiman Mohd Yusof Beliau memperolehi Ijazah Sarjana Muda Undang-undang (LLB) dari University of Buckingham, United Kingdom pada tahun 1984 dan diterima masuk ke Malaysian Bar pada tahun Beliau memulakan kerjayanya sebagai Pelatih Wartawan Kadet dengan Agensi Berita Bernama pada tahun Seterusnya pada tahun yang sama, beliau menyertai Polis Di Raja Malaysia. Beliau menjawat pelbagai jawatan dalam Polis Di Raja Malaysia seperti Timbalan Superitendan Personel, Setiausaha yang bertanggungjawab kepada Ketua Polis Negara, Tun Haniff Omar, Pegawai Polis Daerah Sentul, Alor Setar dan Sungai Petani dan Penolong Pesuruhjaya Penyelidikan dan Perancangan di Bukit Aman. Pada tahun 2002, beliau menjadi Timbalan Pengarah Pengurusan (Disiplin), Timbalan Pengarah Jabatan Narkotik pada tahun 2003, Ketua Polis Negeri Sembilan pada tahun 2004, Timbalan Pengarah, Jabatan Siasatan Jenayah Komersial pada tahun 2005 dan sebagai Ketua Polis Kuala Lumpur pada tahun 2006 sehingga persaraan beliau. Pada bulan April 2007, beliau membuka syarikat guamannya sendiri, sekarang ini dikenali sebagai Sulaiman, Jamellah & Clement. Beliau juga merupakan Pengarah AWC Berhad dan beberapa syarikat sendirian berhad yang lain. Beliau tidak mempunyai perhubungan kekeluargaan dengan mana-mana pengarah/pemegang saham utama Malaysia dan tidak mempunyai percanggahan kepentingan dengan Malaysia. Beliau tidak pernah disabitkan dengan apa-apa kesalahan dalam tempoh sepuluh (10) tahun yang lalu dan telah menghadiri kesemua lapan (8) mesyuarat Lembaga Pengarah yang diadakan dalam tahun kewangan berakhir 31 Disember He graduated with a Bachelor of Law (LLB) degree from the University of Buckingham, United Kingdom in 1984 and was called to the Malaysian Bar in He started his career as a Cadet Reporter Trainee with Bernama News Agency in Later in the same year, he joined Royal Malaysia Police. He assumed various positions at the Royal Malaysia Police such as Deputy Superintendent of Personnel, Secretary responsible for the IGP, Tun Haniff Omar, Police Officer for District of Sentul, Alor Setar and Sungai Petani and Assistant Commissioner of Research and Planning at Bukit Aman. In 2002, he became the Deputy Director, Management (Discipline), in 2003 as Deputy Director, Narcotics Department, in 2004 as the Chief Police Officer of Negeri Sembilan, in 2005 as Deputy Director, Commercial Crime Investigation Department and in 2006 as the Chief Police Officer of Kuala Lumpur until his retirement. In April 2007, he started his own legal firm, currently known as Sulaiman, Jamellah & Clement. He is also a Director of AWC Berhad and other private limited companies. He has no family relationship with any other directors/major shareholders of Malaysia and has no conflict of interest with Malaysia. He has no conviction for offences within the past ten (10) years and has attended all eight (8) Board of Directors meetings held during the financial year ended 31 December 2012.

21 Syarikat Malaysia Berhad ( K) 019 Profil Lembaga Pengarah Laporan Tahunan 2012 Annual Report Board of Directors Profile Pengarah Bukan Eksekutif Bukan Bebas / Non-Independent Non-Executive Director Encik Johan Abdullah, berusia 56 tahun, adalah warganegara Malaysia dan merupakan Pengarah Bukan Eksekutif Bukan Bebas Malaysia dan telah dilantik pada 15 Ogos Beliau juga merupakan ahli Jawatankuasa Pemilihan, Jawatankuasa Risiko Lembaga Pengarah dan Jawatankuasa Ganjaran. Encik Johan Abdullah, aged 56, is a Malaysian citizen and is a Non- Independent Non-Executive Director of Malaysia and was appointed to the Board on 15 August He is also a member of the Nomination Committee, Board Risk Committee and Remuneration Committee. Encik Johan Abdullah Beliau memperolehi Diploma Perbankan dari Universiti Teknologi MARA, Shah Alam pada tahun 1983, Ijazah Sarjana Muda Pentadbiran Perniagaan (Kewangan) dari Eastern Michigan University, USA pada tahun 1985 dan Ijazah Sarjana Pentadbiran Perniagaan (Kewangan) dari Morehead State University, USA pada tahun Beliau memulakan kerjaya profesionalnya pada tahun 1987 di Kuala Lumpur Stock Exchange (sekarang ini dikenali sebagai Bursa Malaysia Securities Berhad) sebagai Pegawai Penyenaraian. Pada tahun 1989, beliau menyertai bahagian Kewangan Korporat di Bumiputra Merchant Bankers Berhad dan meletak jawatan pada awal tahun 1995 sebagai Pengurus Kanan. Beliau kemudiannya menyertai Damansara Realty Berhad sebagai Pengurus Besar, Perancangan Korporat. Seterusnya pada tahun 1999, beliau menyertai semula Bursa Malaysia Securities Berhad dan telah memegang pelbagai jawatan kanan termasuk Deputy Chief Regulatory Officer, Group Regulation. Pada bulan Mei 2008, beliau menyertai BIMB Holdings Berhad ( BHB ) sebagai Pengarah Urusan Kumpulan/Ketua Pegawai Eksekutif. Beliau juga merupakan Pengarah Bank Islam Malaysia Berhad dan anak-anak syarikat di dalam kumpulan BHB. Beliau tidak mempunyai perhubungan kekeluargaan dengan mana-mana pengarah/pemegang saham utama Malaysia dan tidak mempunyai percanggahan kepentingan dengan Malaysia. Beliau tidak pernah disabitkan dengan apa-apa kesalahan dalam tempoh sepuluh (10) tahun yang lalu dan telah menghadiri kesemua lapan (8) mesyuarat Lembaga Pengarah yang diadakan dalam tahun kewangan berakhir 31 Disember He obtained a Diploma in Banking from University Technology MARA, Shah Alam in 1983, a Bachelor of Business Administration (Finance) from Eastern Michigan University, USA in 1985 and a Master in Business Administration (Finance) from Morehead State University, USA in He started his professional career in 1987 with Kuala Lumpur Stock Exchange (now known as Bursa Malaysia Securities Berhad) as Listing Officer. In 1989, he joined Corporate Finance division of Bumiputra Merchant Bankers Berhad and left the bank in early 1995 as Senior Manager. Later he joined Damansara Realty Berhad as General Manager, Corporate Planning. Subsequently in the year 1999, he re-joined Bursa Malaysia Securities Berhad and took up various senior positions including that of Deputy Chief Regulatory Officer, Group Regulation. In May 2008, he joined BIMB Holdings Berhad ( BHB ) as the Group Managing Director/ Chief Executive Officer. He is also a director of Bank Islam Malaysia Berhad and other subsidiaries within BHB Group. He has no family relationship with any other directors/major shareholders of Malaysia and has no conflict of interest with Malaysia. He has no conviction for offences within the past ten (10) years and has attended all eight (8) Board of Directors meetings held during the financial year ended 31 December 2012.

22 020 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Profil Lembaga Pengarah Board of Directors Profile Pengarah Bukan Eksekutif Bebas / Independent Non-Executive Director Encik Zakaria Ismail, berusia 61 tahun, adalah warganegara Malaysia dan merupakan Pengarah Bukan Eksekutif Bebas Malaysia dan telah dilantik pada 15 Mei Beliau juga merupakan Pengerusi Jawatankuasa Ganjaran dan Jawatankuasa Risiko Lembaga Pengarah dan ahli Jawatankuasa Audit dan Jawatankuasa Pemilihan. Encik Zakaria Ismail, aged 61, is a Malaysian citizen and is an Independent Non-Executive Director of Malaysia and was appointed to the Board on 15 May He is also the Chairman of the Remuneration Committee and Board Risk Committee and a member of Audit Committee and Nomination Committee. Encik Zakaria Ismail Beliau memperolehi Ijazah Sarjana Muda Ekonomi (Kepujian) dari Universiti Malaya pada tahun 1974 dan Sarjana Pentadbiran Perniagaan dan Sarjana Sastera dalam Ekonomi dari Universiti Boston, Amerika Syarikat, masingmasing pada tahun 1981 dan Beliau juga merupakan ahli bersekutu The Institute of Bankers, London. Beliau memulakan kerjayanya di Bank Negara Malaysia (BNM) pada tahun 1974 dan memegang pelbagai jawatan seperti Eksekutif Kanan, Penyeliaan Perbankan; Setiausaha Sulit, Pejabat Gabenor, Eksekutif Kanan, Ekonomi; Penolong kepada Pengarah Eksekutif, South East Asia Group IMF; di Washington, D.C Amerika Syarikat; Pengurus, Ekonomi; Pengurus, Penyeliaan Perbankan; Timbalan Pengarah, Pelaburan; Timbalan Pengarah, Penyeliaan Perbankan; Pengarah, Penyeliaan Perbankan; Pengarah, Penyeliaan Insurans dan Pengarah, Pengawalan Insurans. Beliau telah dipinjamkan sebagai Pengarah Urusan di Entrepreneurs Rehabilitation Fund (ERF) pada tahun 2002 sehingga 2004 dan seterusnya dipinjamkan sebagai Pengarah Latihan dan Pentadbiran di The South East Asian Central Banks Research and Training Centre (SEACEN) pada tahun 2004 sehingga persaraan beliau pada tahun Beliau juga merupakan ahli Lembaga Pengarah di Malaysian Insurance Institute (MII) dan ahli EXCO MII dari tahun 2000 sehingga Kini, beliau juga merupakan ahli Lembaga Pengarah Export-Import Bank of Malaysia Berhad. Beliau tidak mempunyai perhubungan kekeluargaan dengan mana-mana pengarah/pemegang saham utama Malaysia dan tidak mempunyai percanggahan kepentingan dengan Malaysia. Beliau tidak pernah disabitkan dengan apa-apa kesalahan dalam tempoh sepuluh (10) tahun yang lalu dan telah menghadiri enam (6) mesyuarat Lembaga Pengarah yang diadakan dalam tahun kewangan berakhir 31 Disember He obtained his Bachelor of Economics (Honours) from the University of Malaya in 1974, and Master in Business Administration and Master of Arts in Economics from Boston University, USA in 1981 and 1983 respectively. He is also an associate of The Institute of Bankers, London. He started his career with Bank Negara Malaysia (BNM) in 1974 and assumed various positions such as Senior Executive, Banking Supervision; Private Secretary, Office of the Governor; Senior Executive, Economics; Assistant to the Executive Director, South East Asia Group IMF; in Washington, D.C. USA; Manager, Economics; Manager, Banking Supervision; Deputy Director, Investment; Deputy Director, Banking Supervision; Director, Banking Supervision; Director, Insurance Supervision and Director, Insurance Regulation. He was seconded to the Entrepreneurs Rehabilitation Fund (ERF) as its Managing Director in 2002 until 2004 and then was seconded to The South East Asian Central Banks Research and Training Centre (SEACEN) as its Director of Training and Administration from 2004 until his retirement in He was also a Board member of the Malaysian Insurance Institute (MII) and member of the EXCO of MII from 2000 until Currently, he is also a Board member of Export-Import Bank of Malaysia Berhad. He has no family relationship with any other directors/major shareholders of Malaysia and has no conflict of interest with Malaysia. He has no conviction for offences within the past ten (10) years and has attended six (6) Board of Directors meetings held during the financial year ended 31 December 2012.

23 Syarikat Malaysia Berhad ( K) 021 Profil Lembaga Pengarah Laporan Tahunan 2012 Annual Report Board of Directors Profile Pengarah Bukan Eksekutif Bebas / Independent Non-Executive Director Y. Bhg. Dato Othman Abdullah, berusia 64 tahun, adalah warganegara Malaysia dan telah dilantik sebagai Pengarah Bukan Eksekutif Bebas Malaysia pada 1 Disember Beliau juga merupakan ahli Jawatankuasa Audit. Y. Bhg. Dato Othman Abdullah, aged 64, is a Malaysian citizen and was appointed on 1 December 2012 as an Independent Non- Executive Director of Malaysia. He is also a member of Audit Committee. Y. Bhg. Dato Othman Abdullah Beliau memperolehi Sarjana Muda Ekonomi dalam Perakaunan dari Universiti Malaya pada tahun 1976 dan merupakan ahli Institut Akauntan Malaysia (MIA). Beliau memulakan kerjayanya pada tahun 1977 sebagai Akauntan Perbendaharaan di Jabatan Akauntan Negara (AG). Beliau telah memegang pelbagai jawatan di Jabatan AG antaranya sebagai Akauntan Kanan Perbendaharaan pada tahun 1982 dan Akauntan pada tahun Beliau telah dipinjamkan kepada Lembaga Letrik Sabah sebagai Timbalan Pengurus Besar (Kewangan) pada tahun Pada tahun 1993, beliau telah dilantik sebagai Timbalan Pengarah, Bahagian Perkhidmatan Operasi Pusat dan Agensi (BPOPA) dan kemudiannya menjadi Pengarah BPOPA pada tahun Seterusnya, pada tahun 1999 beliau telah dilantik sebagai Pengarah, Bahagian Pengurusan Perakaunan Cawangan; pada tahun 2000 sebagai Timbalan Akauntan Negara Malaysia dan pada tahun 2003 sebagai Akauntan Negara Malaysia sehingga beliau bersara pada bulan Mac Kini, beliau juga adalah Pengarah ECM Libra Financial Group Berhad, Syarikat Perumahan Negara Berhad dan Indah Water Konsortium Sdn Bhd. Beliau tidak mempunyai perhubungan kekeluargaan dengan mana-mana pengarah/pemegang saham utama Malaysia dan tidak mempunyai percanggahan kepentingan dengan Malaysia. Beliau tidak pernah disabitkan dengan apa-apa kesalahan dalam tempoh sepuluh (10) tahun yang lalu. Beliau tidak menghadiri mesyuarat Lembaga Pengarah sepanjang tahun kewangan berakhir 31 Disember 2012 kerana beliau dilantik menjadi ahli Lembaga Pengarah pada 1 Disember 2012 dan tiada mesyuarat Lembaga Pengarah diadakan dalam bulan Disember He obtained his Bachelor of Economics in Accounting from the University of Malaya in 1976 and is a member of the Malaysian Institute of Accountants (MIA). He started his career in 1977 as Treasury Accountant at the Accountant General s (AG) Department. He held various positions in the AG Department among others as the Senior Treasury Accountant in 1982 and Accountant in He was seconded to the Sabah Electricity Board as the Deputy General Manager (Finance) in In 1993, he was appointed as the Deputy Director of Central Operation and Agency Services Division (BPOPA) and later he became the Director of BPOPA in In 1999, he then served as the Director of Branch Account Management Division, in 2000 as the Deputy Accountant General of Malaysia and in 2003 as the Accountant General of Malaysia until his retirement in March Currently, he is also a Director of ECM Libra Financial Group Berhad, Syarikat Perumahan Negara Berhad and Indah Water Konsortium Sdn Bhd. He has no family relationship with any other directors/major shareholders of Malaysia and has no conflict of interest with Malaysia. He has no conviction for offences within the past ten (10) years. He did not attend Board of Directors meeting during the financial year ended 31 December 2012 as he was appointed to the Board on 1 December 2012 and no Board meeting was held in December 2012.

24 022 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Profil Badan Penasihat Syariah Shariah Advisory Body s Profile Pengerusi / Chairman Y. Bhg. Dr. Ahmad Sobri Salamon, berusia 70 tahun, adalah warganegara Malaysia dan merupakan Pengerusi Badan Penasihat Syariah (BPS) Malaysia yang telah dilantik pada 1 Julai Y. Bhg. Dr. Ahmad Sobri Salamon, aged 70, is a Malaysian citizen and is the Chairman of the Shariah Advisory Body (SAB) of Malaysia who was appointed on 1 July Y. Bhg. Dr. Ahmad Sobri Salamon Beliau memperolehi Ijazah Sarjana Muda Sastera dalam Syariah dari Universiti Al Azhar, Mesir pada tahun 1970, Sarjana Sastera dalam Pengajian Antarabangsa dari Universiti Fairleigh Dickenson, Amerika Syarikat pada tahun 1973, Sarjana Falsafah dalam Sains Politik dan Ijazah Doktor Falsafah dalam Sejarah dari Universiti New York, Amerika Syarikat masing-masing pada tahun 1975 dan Beliau memulakan kerjayanya pada tahun 1978 sebagai Pensyarah di Jabatan Syariah, Fakulti Pengajian Islam, Universiti Kebangsaan Malaysia (UKM) sebelum dipinjamkan ke Universiti Islam Antarabangsa (UIAM) dari tahun 1983 hingga Semasa di UKM, beliau telah dilantik sebagai Penyelaras bagi Pendidikan Umum dari tahun 1981 hingga Pada tahun 1982, beliau berkhidmat sebagai Pemangku Ketua Jabatan Syariah. Beliau juga merupakan Penyelaras Program Diploma dan Sijil Pengajian Islam UKM sehingga tahun Beliau kembali ke UKM pada tahun 1984 sebagai Pensyarah di Jabatan Syariah sehingga tahun Kemudian beliau menjadi Pengarah Eksekutif Pusat Rawatan Islam (MAIS) dari tahun 1996 hingga Kini, beliau merupakan Pengerusi Pusrawi Corporation Sdn Bhd dan ahli Majlis Perundingan Islam di Jabatan Perdana Menteri (JPM). Beliau telah menghasilkan tulisan dalam bidang pendidikan, ekonomi, perbankan Islam dan perundangan Islam sebanyak 12 buah buku, 7 jilid terjemahan, 300 skrip tv dan 40 kertas kerja. Beliau juga dianugerahkan sebagai Tokoh Ulamak Bestari Negeri Selangor pada tahun 2000, Tokoh Ma al Hijrah Negeri Selangor pada tahun 2001 dan Ahli Majlis Agama Islam Negeri Selangor selama 21 tahun. He graduated with a Bachelor of Arts degree in Shariah from the University of Al-Azhar, Egypt in 1970, a Master of Arts in International Studies from Fairleigh Dickenson University, USA in 1973, a Master of Philosophy in Political Sciences and a Doctor of Philosophy in History from New York University, USA in 1975 and 1979 respectively. He started his career in 1978 as a Lecturer at the Shariah Department, Faculty of Islamic Studies, Universiti Kebangsaan Malaysia (UKM) prior to his secondment to the International Islamic University Malaysia (IIUM) from 1983 to Whilst with UKM, he was appointed as the Coordinator for the General Teachings from 1981 to In 1982, he served as the Acting Head of the Shariah Department. He was also the Programme Coordinator for Diploma and Certificate in Islamic Studies of UKM until He returned to UKM in 1984 as a Lecturer in the Shariah Department until He then became an Executive Director of Pusat Rawatan Islam (MAIS) from 1996 to Currently, he is the Chairman of Pusrawi Corporation Sdn Bhd and a member of the Islamic Consultative Council in the Prime Minister s Department. He has produced writings in educational, economy, Islamic banking and Islamic law, a total of 12 books, 7 translation bindery, 300 tv scripts and 40 paper works. He was also awarded Tokoh Ulamak Bestari Negeri Selangor in 2000, Tokoh Ma al Hijrah Negeri Selangor in 2001 and a member of Religious Council of Selangor State for 21 years.

25 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 023 Profil Badan Penasihat Syariah Shariah Advisory Body s Profile Ahli / Member Y. Bhg. Ustaz Mohd Bakir Hj. Mansor, berusia 76 tahun, adalah warganegara Malaysia dan merupakan ahli Badan Penasihat Syariah (BPS) Malaysia, dilantik pada 1 Julai Beliau memperolehi Shahadah Ulya (Sijil Tertinggi) dari Kolej Islam Malaya pada tahun Y. Bhg. Ustaz Mohd Bakir Hj. Mansor, aged 76, is a Malaysian citizen and is a member of the Shariah Advisory Body (SAB) of Malaysia, appointed on 1 July He obtained the Shahadah Ulya (Highest Certificate) from Kolej Islam Malaya in Y. Bhg. Ustaz Mohd Bakir Hj. Mansor Beliau telah memulakan kerjayanya sebagai guru sementara di Madrasah Mashhoor Islamiyah, Pulau Pinang dari tahun 1967 hingga Beliau kemudiannya berkhidmat sebagai Pegawai Penerangan sementara di Majlis Kebangsaan Hal Ehwal Agama Islam Malaysia mulai tahun 1971 hingga 1973; sebagai Pegawai Hal Ehwal Islam di Bahagian Hal Ehwal Islam, Jabatan Perdana Menteri dari tahun 1973 hingga 1977; sebagai Pegawai Perancangan Pendidikan Ugama di Jabatan Kemajuan Masyarakat, Kementerian Pertanian dari tahun 1978 hingga 1980; sebagai Penolong Pengarah Dokumentasi di Bahagian Hal Ehwal Islam, Jabatan Perdana Menteri mulai tahun 1980 hingga 1981 dan sebagai seorang Ketua Penolong Pengarah Pusat Penyelidikan Islam dari tahun 1981 hingga Beliau kemudiannya berkhidmat dengan Bank Islam Malaysia Berhad sebagai Koordinator Syariah merangkap Setiausaha Majlis Pengawasan Syariah Bank dari tahun 1984 hingga Beliau pernah berkhidmat sebagai Internal Research Fellow for the Centre of Fiqh Muamalat di Institut Perbankan dan Kewangan Islam Malaysia (IBFIM) dari 2 Januari 2001 hingga 30 Jun Beliau kini merupakan Penasihat Syariah Ternama di Pusat Fiqh Muamalat berkuatkuasa dari 1 Julai Beliau juga adalah ahli Majlis Pengawasan Syariah Bank Islam Malaysia Berhad, ahli Jawatankuasa Panel Syariah Amanah Ikhtiar Malaysia, Pengerusi Jawatankuasa Penasihat Syariah BIMB Securities Sdn Bhd, Pengerusi Jawatankuasa Penasihat Syariah Persatuan Institusi-Institusi Perbankan Islam Malaysia dan Pengerusi Jawatankuasa Penasihat Syariah Kumpulan Wang Simpanan Pekerja. Sebelum dilantik sebagai ahli BPS Malaysia pada 1 Julai 2002, beliau adalah Setiausaha BPS Malaysia sejak ia ditubuhkan pada tahun 1985 hingga Disember He started his career as a temporary teacher at Madrasah Mashhoor Islamiyah, Pulau Pinang from 1967 to He then served as a temporary Information Officer at the National Council for Islamic Religious Affairs Malaysia from 1971 to 1973; as an Islamic Affairs Officer at the Islamic Affairs Division, the Prime Minister s Department from 1973 to 1977; as the Religious Education Planning Officer at the Community Development Department, Ministry of Agriculture from 1978 to 1980; as an Assistant Documentation Director at the Islamic Affairs Division, the Prime Minister s Department from 1980 to 1981 and as a Chief Assistant Director of Islamic Research Centre from 1981 to He then served at Bank Islam Malaysia Berhad as Shariah Coordinator cum Secretary to the Bank s Shariah Supervisory Council from 1984 to He was previously an Internal Research Fellow for the Centre of Fiqh Muamalat at Islamic Banking and Finance Institute Malaysia (IBFIM) from 2 January 2001 until 30 June He is currently a Distinguished Shariah Advisor for the Centre of Fiqh Muamalat effective from 1 July He is also a member of the Shariah Supervisory Council of Bank Islam Malaysia Berhad, a member of the Shariah Panel of Amanah Ikhtiar Malaysia, the Chairman of the Shariah Advisory Committee of BIMB Securities Sdn Bhd, the Chairman of the Shariah Advisory Committee of the Association of Islamic Banking Institutions Malaysia and the Chairman of the Shariah Advisory Committee of the Employees Provident Fund. Before being appointed as a member of the SAB of Malaysia on 1 July 2002, he was the Secretary of the SAB of Malaysia since its inception in 1985 to December 2001.

26 024 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Profil Badan Penasihat Syariah Shariah Advisory Body s Profile Ahli / Member Y. Bhg. Dr. Aida Othman, berusia 43 tahun, adalah warganegara Malaysia dan merupakan ahli Badan Penasihat Syariah (BPS) Malaysia yang telah dilantik pada 6 Mac Y. Bhg. Dr. Aida Othman, aged 43, is a Malaysian citizen and is a member of the Shariah Advisory Body (SAB) of Malaysia who was appointed on 6 March Y. Bhg. Dr. Aida Othman Beliau memperolehi Ijazah Sarjana Muda Undang-undang (LL.B) dari Universiti Islam Antarabangsa pada tahun 1992 dan Ijazah Sarjana Muda Undang-undang (LL.B Syariah) pada tahun Pada tahun 1995, beliau memperolehi Sarjana Undang-undang (LL.M) dari Universiti Cambridge, England dan pada tahun 2005 beliau memperolehi Doktor Falsafah dari Universiti Harvard, Amerika Syarikat. Beliau juga memperolehi PostDoctorate Fellowship dari Universiti Harvard pada tahun Beliau memulakan kerjayanya dengan Tetuan Zain & Co. pada tahun 1993 sebagai Penolong Pegawai Undang Undang. Pada tahun 1995, beliau menyertai Universiti Islam Antarabangsa sebagai Pensyarah. Kemudian beliau menjadi Penyelidik di United Nations dari tahun 1998 hingga Pada tahun 2002, beliau berkhidmat di Universiti Harvard sebagai Teaching Fellow sehingga tahun 2003 dan PostDoctorate Fellow dan Teaching Assistant dari tahun 2005 hingga Beliau kini merupakan Rakan kongsi di firma guaman Zaid Ibrahim & Co. dan juga sebagai Pengarah di ZI Shariah Advisory Sdn Bhd. She graduated from the International Islamic University Malaysia with a Bachelor of Law (LL.B) degree in 1992 and a Bachelor of Law (LL.B Shariah) degree in In 1995, she obtained a Master in Law (LL.M) from the Cambridge University, England and in 2005, she obtained a Doctor of Philosophy from the Harvard University, USA. She also obtained a PostDoctorate Fellowship from the Harvard University in She started her career with Messrs. Zain & Co. in 1993 as Assistant Legal Officer. In 1995, she joined International Islamic University Malaysia as a Lecturer. After that, she became a Researcher at United Nations from 1998 until In 2002, she joined the Harvard University as a Teaching Fellow until 2003 and a PostDoctorate Fellow and Teaching Assistant from 2005 until Currently she is a Partner at the law firm, Zaid Ibrahim & Co. as well as a Director at ZI Shariah Advisory Sdn Bhd.

27 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 025 Profil Badan Penasihat Syariah Shariah Advisory Body s Profile Ahli / Member Y. Bhg. Prof. Madya Dr. Muhamad Rahimi Osman, berusia 52 tahun, adalah warganegara Malaysia dan merupakan ahli Badan Penasihat Syariah (BPS) Malaysia yang telah dilantik pada 12 Januari Y. Bhg. Associate Prof. Dr. Muhamad Rahimi Osman, aged 52, is a Malaysian citizen and is a member of the Shariah Advisory Body (SAB) of Malaysia who was appointed on 12 January Y. Bhg. Prof. Madya Dr. Muhamad Rahimi Osman Berkelulusan Ijazah Sarjana Muda Syariah (Hons) dari Universiti Malaya pada tahun 1987, Ijazah Sarjana dalam Ekonomi Islam dari Universiti Yarmouk, Jordan dan Doktor Falsafah (PhD) dalam Perbankan Islam dari Universiti Islam Antarabangsa Malaysia masing-masing pada tahun 1996 dan Sekarang ini, beliau memegang jawatan Pengarah, Pusat Pemikiran dan Kefahaman Islam (CITU), Universiti Teknologi MARA (UiTM), Shah Alam. Beliau memulakan kerjayanya sebagai pensyarah di Pusat Pendidikan Islam, Universiti Teknologi MARA (UiTM), Shah Alam pada tahun Beliau telah dilantik memegang beberapa jawatan pentadbiran seperti Koordinator Sains Sosial Islam, Ketua Unit Zakat, Timbalan Pengarah, Pusat Pemikiran dan Kefahaman Islam (CITU) dan Pengarah, Institut Kajian Zakat Malaysia (IKaZ), Universiti Teknologi MARA. Beliau juga adalah ahli Jawatankuasa Penasihat Syariah Hong Leong Islamic Bank Malaysia, ahli jawatankuasa Penyelaras Kurikulum Program Muamalat,, Kewangan dan Perbankan Islam, Kementerian Pengajian Tinggi Malaysia, Ahli Senat Universiti dan ahli Majlis Dekan Pengajian Islam, Institusi Pengajian Tinggi Awam Malaysia dan beberapa jawatankuasa lain di dalam dan luar Universiti. Beliau juga telah menulis dan membentangkan kertas kerja di peringkat nasional dan antarabangsa dan terlibat menjalankan penyelidikan dalam bidang ekonomi, perbankan dan kewangan Islam. Artikel beliau juga telah diterbitkan dalam jurnal tempatan dan antarabangsa. He graduated from the University of Malaya in 1987, holding a Bachelor of Shariah (Hons). He obtained his Master in Islamic Economics from the University of Yarmouk, Jordan and a Doctor of Philosophy (PhD) in Islamic Banking from the International Islamic University Malaysia in 1996 and 2007 respectively. Currently he is a Director of the Centre for Islamic Thought and Understanding (CITU), Universiti Teknologi MARA (UiTM), Shah Alam. He joined Universiti Teknologi MARA (UiTM), Shah Alam in 1988 as an academic staff at the Centre for Islamic Education. He was appointed to several administration posts such as Coordinator of Islamic Social Science, Head of Zakat Unit, Deputy Director, Centre for Islamic Thought and Understanding (CITU) and Director of the Zakat Research Institute of Malaysia (IKaZ), Universiti Teknologi MARA. He also serves as a member of Shariah Committee of Hong Leong Islamic Bank Malaysia, member of the Curriculum Review Committee for Muamalat,, Islamic Banking and Finance of the Ministry of Higher Education Malaysia, member of the Senate University, and member of the Dean Council of Islamic Studies, Higher Learning Institutions of Malaysia and several other committees inside and outside of the University. He has written and presented papers at national and international seminars related to Islamic economics, Islamic banking and finance. His articles have also been published in local and international journals.

28 026 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Profil Badan Penasihat Syariah Shariah Advisory Body s Profile Ahli / Member Y. Bhg. Dato Wan Mohamad Dato Sheikh Abdul Aziz, berusia 60 tahun, adalah warganegara Malaysia dan merupakan ahli Badan Penasihat Syariah (BPS) Malaysia yang telah dilantik pada 1 Jun Y. Bhg. Dato Wan Mohamad Dato Sheikh Abdul Aziz, aged 60, is a Malaysian citizen and is a member of the Shariah Advisory Body (SAB) of Malaysia who was appointed on 1 June Y. Bhg. Dato Wan Mohamad Dato Sheikh Abdul Aziz Beliau memperolehi Diploma Pendidikan pada tahun 1977 dan Sarjana Muda dalam Pengajian Islam (Kepujian) pada tahun 1978 dari Universiti Kebangsaan Malaysia. Beliau juga memperolehi Diploma Sains Pengurusan dari Institut Tadbiran Awam Negara (INTAN) pada tahun Beliau merupakan ahli British Institute of Management (MBIM) sejak tahun Beliau memulakan kerjayanya pada tahun 1978 sebagai Penolong Pengarah dan kemudiannya menjadi Penolong Pengarah Kanan di Institut Dakwah dan Latihan Islam (INDAH) Bahagian Hal Ehwal Islam (BAHEIS), Jabatan Perdana Menteri. Beliau kemudian menjadi Atase Ugama di Pejabat Pesuruhjaya Tinggi Malaysia di London selama tiga tahun sejak tahun Selepas pulang ke Malaysia pada tahun 1986, beliau dinaikkan pangkat sebagai Ketua Penolong Pengarah di BAHEIS dan kemudiannya sebagai Ketua Bahagian Amar Ma ruf dan Ketua Pendaftar Nikah, Cerai dan Rujuk di Jabatan Agama Islam Wilayah Persekutuan (JAWI). Pada tahun 1993, beliau bertugas sebagai Ketua Penolong Pengarah Ekonomi, Pentadbiran Sosial, Pusat Penyelidikan Islam. Pada tahun 1994, beliau merupakan Pengetua Darul Quran Jabatan Kemajuan Islam Malaysia (JAKIM) dan kemudiannya memegang pelbagai jawatan seperti Pengarah Bahagian Keluarga, Sosial dan Pengurusan Masjid (KESUMA), Pengarah Bahagian Penyelidikan, Timbalan Ketua Pengarah (Operasi) dan Ketua Pengarah masing-masing pada tahun 2000, 2003, 2004 dan 2007 sebelum beliau bersara pada 22 April Sepanjang tempoh menjadi Ketua Pengarah JAKIM, beliau juga bertindak sebagai Setiausaha Jawatankuasa Fatwa Kebangsaan. Beliau juga pernah berkhidmat sebagai ahli Majlis Penasihat Syariah di Bank Negara Malaysia pada tahun 2008 sehingga tahun Kini, beliau merupakan ahli Lembaga Pengarah Institut Kefahaman Islam Malaysia (IKIM). He graduated from Universiti Kebangsaan Malaysia with a Diploma in Education in 1977 and a Bachelor of Islamic Studies (Honours) in He also obtained a Diploma in Management Science from the National Institute of Public Administration (Institut Tadbiran Awam Negara (INTAN)) in He is a member of British Institute of Management (MBIM) since He started his career in 1978 as an Assistant Director and later as Senior Assistant Director at the Institut Dakwah dan Latihan Islam (INDAH) of Islamic Affairs Division (Bahagian Hal Ehwal Islam (BAHEIS)), Prime Minister s Department. He then served as Atase Ugama at the Malaysian High Commission s office in London for three years from Upon returning to Malaysia in 1986, he was promoted to Chief Assistant Director in BAHEIS and thereafter as the Chief of Amar Ma ruf Division and Chief Registrar of Marriage, Divorce and Ruju at the Federal Territory Islamic Religious Department (Jabatan Agama Islam Wilayah Persekutuan (JAWI)). In 1993, he served as Chief Assistant Director of Social, Administration and Economy at the Islamic Research Center. In 1994, he served as Principal at the Darul Quran of the Malaysian Islamic Development Department (Jabatan Kemajuan Islam Malaysia (JAKIM)) and later assumed various positions such as Director of Family, Social and Mosque Management Division (KESUMA), Director of Research Division, Deputy Director General (Operation) and Director General of JAKIM in 2000, 2003, 2004 and 2007 respectively before his retirement on 22 April He also served as Secretary to the National Fatwa Committee while serving as Director General of JAKIM. He was also previously a member of the Shariah Advisory Council of Bank Negara Malaysia from 2008 until He is currently a Board member of the Institute of Islamic Understanding Malaysia (Institut Kefahaman Islam Malaysia (IKIM)).

29 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 027 Jawatankuasa Pengurusan Management Committee Y. Bhg. Dato Mohamed Hassan Md. Kamil Pengarah Urusan Kumpulan / Group Managing Director Encik Lee Hin Sze Ketua Pegawai Kewangan / Chief Financial Officer Puan Azian Kassim Ketua Pegawai Pelaburan / Chief Investment Officer Encik Mohamad Asri Hj. Yusoff Setiausaha Syarikat/Pengurus Besar, Hal Ehwal Korporat / Company Secretary/General Manager, Corporate Affairs

30 028 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Jawatankuasa Pengurusan Management Committee 5 Encik Nazrul Hisham Abdul Hamid Pengurus Besar, Operasi / General Manager, Operations Encik Leem Why Chong Pengurus Besar, Aktuari & Aktuari Dilantik / General Manager, Actuarial & Appointed Actuary Puan Norazlin Mohd Dahari Pengurus Besar, Jualan Korporat / General Manager, Corporate Sales Encik Mohd Suhaimi Ahmad Pengurus Besar, Agensi Runcit / General Manager, Retail Agency

31 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 029 Jawatankuasa Pengurusan Management Committee 9 Puan Shuhaibahtulaslamiah Hurmuzan Pengurus Besar, Sumber Manusia / General Manager, Human Resource Encik Patrick Wong Chang Yang Ketua Pegawai Informasi / Chief Information Officer Encik Mark Anthony Nathan Pengurus Besar, Bankatakaful / General Manager, Bancatakaful 12 Cik Leong Chee Wan Penolong Pengurus Besar, Operasi Keluarga/ Bankatakaful/ Logistik / Assistant General Manager, Operations Family / Bancatakaful/ Logistic

32 030 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Jawatankuasa Pengurusan Management Committee Puan Haniza Filzah Hayani Abu Haniffa Penolong Pengurus Besar, Audit Dalaman / Assistant General Manager, Internal Audit Encik Wahizan Abdul Wahid Penolong Pengurus Besar, Pematuhan & Pengurusan Risiko / Assistant General Manager, Compliance & Risk Management 15 Puan Mala Patmarajah Ketua, Komunikasi Korporat / Head of Corporate Communications

33 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 031 Laporan Jawatankuasa Audit Audit Committee Report Lembaga Pengarah Syarikat Malaysia Berhad ( Malaysia ) dengan berbesar hati membentangkan Laporan Jawatankuasa Audit bagi tahun kewangan yang dikaji. Jawatankuasa Audit ( Jawatankuasa ) telah ditubuhkan pada 6 Mac 1990 untuk menilai struktur kewangan, sistem kawalan dalaman, perancangan strategik, pelaksanaan fungsi audit Malaysia dan untuk mencadangkan keputusan yang boleh dilaksanakan bagi memastikan piawaian tanggungjawab korporat, kewibawaan dan kebertanggungjawaban kepada para pemegang saham yang tinggi, selaras dengan piawaian urus tadbir dan pendedahan yang dikehendaki daripada sebuah syarikat senarai awam di Malaysia. KEAHLIAN DAN MESYUARAT Jawatankuasa kini terdiri daripada empat (4) orang ahli, di mana kesemuanya adalah Pengarah Bukan Eksekutif Bebas. Maklumat terperinci mengenai ahli dan mesyuarat yang diadakan sepanjang tahun kewangan berakhir 31 Disember 2012 adalah seperti berikut: The Board of Directors of Syarikat Malaysia Berhad ( Malaysia ) is pleased to present the Audit Committee Report for the financial year under review. The Audit Committee ( Committee ) was established on 6 March 1990 to appraise Malaysia s financial structure, internal control system, strategic planning, implementation of audit function and to propose applicable decisions in ensuring a high standard of corporate responsibility, integrity and accountability to shareholders in line with the corporate governance and disclosure standards expected from that of a public listed company in Malaysia. MEMBERSHIP AND MEETINGS The Committee currently comprises four (4) members, all of whom are Independent Non-Executive Directors. The details of members and meetings held during the financial year ended 31 December 2012 are as follows: No. of Meetings Nama Ahli Jawatankuasa Audit Encik Mahadzir Azizan (Pengerusi) (Pengarah Bukan Eksekutif Bebas Kanan) Puan Rozaida Omar (Pengarah Bukan Eksekutif Bukan Bebas) (Ahli sehingga 30 November 2012) Bil. Mesyuarat Diadakan Dihadiri Name of Audit Committee Members Encik Mahadzir Azizan (Chairman) (Senior Independent Non-Executive Director) Puan Rozaida Omar (Non-Independent Non-Executive Director) (Member up to 30 November 2012) Held Attended Y. Bhg. Dato Sulaiman Mohd Yusof (Pengarah Bukan Eksekutif Bebas) 9 9 Y. Bhg. Dato Sulaiman Mohd Yusof (Independent Non-Executive Director) 9 9 Encik Zakaria Ismail (Pengarah Bukan Eksekutif Bebas) 9 9 Encik Zakaria Ismail (Independent Non-Executive Director) 9 9 Y. Bhg. Dato Othman Abdullah (Pengarah Bukan Eksekutif Bebas) (Dilantik pada 1 Disember 2012) 1 1 Y. Bhg. Dato Othman Abdullah (Independent Non-Executive Director) (Appointed on 1 December 2012) 1 1

34 032 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Laporan Jawatankuasa Audit Audit Committee Report Puan Rozaida Omar dan Y. Bhg. Dato Othman Abdullah adalah ahliahli Institut Akauntan Malaysia ( MIA ). Oleh itu, Malaysia telah mematuhi Perenggan 15.09(1)(c)(i) Keperluan Penyenaraian Pasaran Utama ( Keperluan Penyenaraian ) Bursa Malaysia Securities Berhad ( Bursa Malaysia ) yang menggariskan bahawa sekurang-kurangnya seorang (1) ahli Jawatankuasa mestilah merupakan ahli MIA. Jawatankuasa telah bermesyuarat sebanyak sembilan (9) kali pada tahun kewangan ini. Mesyuarat tersebut telah disusun dan dijalankan dengan sewajarnya melalui penggunaan agenda yang diedarkan kepada ahli terlebih dahulu dengan notis yang mencukupi. Pengarah Urusan Kumpulan, Ketua Pegawai Kewangan dan Ketua Audit Dalaman selalunya menghadiri mesyuarat tersebut. Dalam tahun kewangan berakhir 31 Disember 2012, Pengarah Urusan Kumpulan dan Ketua Audit Dalaman/ Penolong Pengurus Besar, Audit Dalaman menghadiri kesemua mesyuarat yang diadakan, manakala Ketua Pegawai Kewangan menghadiri 7 daripada 9 mesyuarat yang diadakan. TERMA RUJUKAN Komposisi Ahli Jawatankuasa hendaklah dilantik oleh Lembaga Pengarah daripada kalangan mereka dan hendaklah terdiri daripada sekurangkurangnya tiga (3) orang ahli, di mana kesemuanya hendaklah terdiri dari Pengarah Bukan Eksekutif dengan majoritinya adalah Pengarah Bebas. Seorang Pengarah Bukan Eksekutif Bebas hendaklah merupakan ahli yang memenuhi keperluan seperti yang diperuntukkan dalam Keperluan Penyenaraian Bursa Malaysia dan garis panduan Bank Negara Malaysia ( BNM ). Sekurang-kurangnya seorang (1) ahli Jawatankuasa: 1) mestilah merupakan ahli MIA; atau 2) jika beliau bukan ahli MIA, beliau mestilah mempunyai pengalaman bekerja sekurang-kurangnya selama tiga (3) tahun dan:- (a) beliau mestilah lulus peperiksaan yang dinyatakan dalam Bahagian I Jadual Pertama Akta Akauntan 1967; atau (b) beliau mestilah merupakan ahli salah sebuah persatuan akauntan yang dinyatakan dalam Bahagian II Jadual Pertama Akta Akauntan 1967; atau 3) memenuhi keperluan-keperluan lain yang digariskan atau diluluskan oleh Bursa Malaysia. Ahli Jawatankuasa hendaklah melantik Pengerusi daripada kalangan mereka yang merupakan seorang Pengarah Bukan Eksekutif Bebas. Sekiranya seorang ahli Jawatankuasa meletak jawatan, meninggal dunia atau atas sebarang sebab tidak lagi menjadi ahli sehingga menyebabkan bilangan ahli kurang daripada tiga (3) orang, maka Lembaga Pengarah hendaklah melantik ahli baru dalam bilangan yang diperlukan untuk mencukupkan bilangan minimum ahli kepada tiga (3) orang dalam tempoh tiga (3) bulan dari peristiwa tersebut. Pengarah gantian tidak boleh dilantik sebagai ahli Jawatankuasa. Puan Rozaida Omar and Y. Bhg. Dato Othman Abdullah are members of the Malaysian Institute of Accountants ( MIA ). Thus, Malaysia complies with Paragraph 15.09(1)(c)(i) of the Main Market Listing Requirements ( Listing Requirements ) of Bursa Malaysia Securities Berhad ( Bursa Malaysia ) which stipulate that at least one (1) member of the Committee must be a member of the MIA. The Committee met nine (9) times during the financial year. The meetings were appropriately structured and conducted through the use of agenda which were distributed to members with sufficient notification. The Group Managing Director, the Chief Financial Officer and the Chief Internal Auditor normally attend the meetings. During the financial year ended 31 December 2012, the Group Managing Director and the Chief Internal Auditor/Assistant General Manager, Internal Audit attended all the meetings held, while the Chief Financial Officer attended 7 out of 9 meetings held. TERM OF REFERENCE Composition The members of the Committee shall be appointed by the Board from amongst their numbers and shall comprise at least three (3) members, all of whom must be Non-Executive Directors with majority of them shall be Independent Directors. An Independent Non-Executive Director shall be the one who fulfils the requirements as provided in the Bursa Malaysia Listing Requirements and the guidelines of Bank Negara Malaysia ( BNM ). At least one (1) member of the Committee: 1) must be a member of the MIA; or 2) if he is not a member of the MIA, he must have at least three (3) years working experience and:- (a) he must have passed the examinations specified in Part I of the First Schedule of the Accountants Act 1967; or (b) he must be a member of one of the associations of accountants specified in Part II of the First Schedule of the Accountants Act 1967; or 3) fulfils such other requirements as prescribed or approved by Bursa Malaysia. The members of the Committee shall elect a Chairman from amongst their numbers who shall be an Independent Non-Executive Director. If a member of the Committee resigns, dies or for any reason ceases to be a member with the result that the number of members are reduced below three (3), the Board shall within three (3) months of that event, appoint such number of new members as may be required to make up the minimum number of three (3) members. No alternate Director can be appointed as a member of the Committee.

35 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 033 Laporan Jawatankuasa Audit Audit Committee Report Lembaga Pengarah hendaklah mengkaji semula tempoh perkhidmatan dan prestasi Jawatankuasa Audit dan setiap ahlinya sekurangkurangnya setiap tiga (3) tahun sekali bagi memastikan Jawatankuasa dan ahlinya telah menjalankan tugas-tugas mereka berdasarkan terma rujukan. Korum dan Prosedur Jawatankuasa Mesyuarat hendaklah diadakan sekurang-kurangnya empat (4) kali setahun atau dengan lebih kerap, mengikut keperluan. Bagi membentuk korum mesyuarat, majoriti ahli yang hadir mestilah merupakan Pengarah Bukan Eksekutif Bebas. Sekiranya Pengerusi tidak hadir, ahli-ahli yang hadir hendaklah melantik seorang Pengerusi bagi mesyuarat tersebut daripada kalangan ahli-ahli yang hadir. Setiausaha Syarikat hendaklah bertindak sebagai Setiausaha Jawatankuasa. Atas persetujuan Pengerusi, Setiausaha hendaklah merangka agenda yang akan diedarkan kepada ahli Jawatankuasa bersama-sama dengan kertas sokongan yang berkaitan dalam tempoh yang berpatutan sebelum setiap mesyuarat. Setiausaha hendaklah mengedarkan minit mesyuarat kepada semua ahli Jawatankuasa. Jawatankuasa boleh, apabila dianggap perlu, menjemput ahli Lembaga Pengarah lain dan/atau ahli Pengurusan Kanan untuk menghadiri mesyuarat Jawatankuasa. Jawatankuasa ini hendaklah bermesyuarat dengan juruaudit luar sekurang-kurangnya dua (2) kali setahun, untuk membincangkan sebarang perkara dengan Jawatankuasa tanpa kehadiran mana-mana ahli eksekutif Lembaga Pengarah dan Pengurusan Kanan. Pengerusi Jawatankuasa akan mengadakan mesyuarat untuk mempertimbangkan sebarang perkara yang pihak juruaudit luar percaya perlu di bawa kepada perhatian para Pengarah atau pemegang saham. Jawatankuasa hendaklah mengatur prosiding mesyuaratnya, dengan mengambil kira konvensyen biasa berhubung perkara tersebut. Kuasa Jawatankuasa diberi kuasa oleh Lembaga Pengarah untuk menyiasat sebarang perkara dalam terma rujukannya. Jawatankuasa juga diberi kuasa untuk mendapatkan sebarang maklumat yang diperlukan daripada mana-mana kakitangan dan semua kakitangan dikehendaki memberi kerjasama terhadap sebarang permintaan yang dibuat oleh Jawatankuasa. Jawatankuasa hendaklah mempunyai akses penuh dan tanpa had kepada sebarang maklumat berkaitan Kumpulan dan hendaklah mempunyai sumber yang diperlukan untuk melaksanakan tugasnya. Jawatankuasa boleh mendapatkan nasihat perundangan atau profesional bebas luar lain yang dianggap perlu, dengan perbelanjaan ditanggung oleh Malaysia. The Board shall review the term of office and performance of the Committee and each of its members at least once every three (3) years to ensure the Committee and members have carried out their duties in accordance with their terms of reference. Quorum and Committee s Procedures Meetings shall be conducted at least four (4) times annually or more frequently as circumstances dictate. In order to form a quorum for the meeting, the majority of members present must be Independent Non-Executive Directors. In the absence of the Chairman, the members present shall elect a Chairman for the meeting from amongst the members present. The Company Secretary shall be the Secretary of the Committee. The Secretary, in concurrence with the Chairman, shall draw up an agenda, which shall be circulated together with relevant support papers within reasonable time prior to each meeting to the members of the Committee. The Secretary shall circulate the minutes of meetings to all members of the Committee. The Committee may, as and when deemed necessary, invite other Board members and/or Senior Management members to attend the Committee meetings. The Committee shall, at least twice (2) a year, meet with the external auditors to discuss any matter with the Committee without the presence of any executive members of the Board and Senior Management. The Chairman of the Committee shall convene a meeting of the Committee to consider any matter which the external auditors believe should be brought to the attention of the Directors or shareholders. The Committee shall regulate the manner of proceedings of its meetings, having regard to normal conventions on such matter. Authority The Committee is authorised by the Board to investigate any matter within its terms of reference. It is authorised to seek any information it requires from any employee and all employees are required to cooperate with any request made by the Committee. The Committee shall have full and unrestricted access to any information pertaining to the Group. The Committee shall have the resources that are required to perform its duties. The Committee can obtain, at the expense of Malaysia, external legal or other independent professional advice it considers necessary.

36 034 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Laporan Jawatankuasa Audit Audit Committee Report Jawatankuasa hendaklah mempunyai saluran komunikasi secara langsung dengan juruaudit dalaman dan juruaudit luar, kakitangan pengurusan risiko dan dengan Pengurusan Kanan Kumpulan dan boleh mengadakan mesyuarat dengan juruaudit luar, juruaudit dalaman atau kedua-duanya sekali, tanpa dihadiri oleh para pengarah dan kakitangan Syarikat, bila-bila dianggap perlu. Sekiranya Jawatankuasa berpendapat bahawa sebarang perkara yang dilaporkan olehnya kepada Lembaga Pengarah masih belum diselesaikan dengan memuaskan sehingga menyebabkan pelanggaran Keperluan Penyenaraian Bursa Malaysia, Jawatankuasa hendaklah melaporkan dengan segera perkara tersebut kepada Bursa Malaysia. Tugas dan Tanggungjawab Objektif utama Jawatankuasa adalah untuk menyediakan pengawasan bebas laporan kewangan Malaysia dan sistem kawalan dalaman serta memastikan semakan dan keseimbangan di dalam Malaysia. Oleh yang demikian, tugas dan tanggungjawab Jawatankuasa adalah termasuk perkara-perkara berikut: mengkaji dengan juruaudit luar dan melaporkan kepada Lembaga Pengarah, skop dan pelan audit, termasuk sebarang perubahan kepada skop yang dirancang bagi pelan audit luar dan penilaian bagi sistem kawalan dalaman. mengkaji kecukupan skop dan pelan audit dalaman, fungsi-fungsi, daya saing dan sumber fungsi audit dalaman dan sama ada ianya mempunyai kuasa diperlukan untuk menjalankan tugas. mengkaji laporan audit dalaman dan luar bagi memastikan supaya tindakan segera dan sewajarnya diambil oleh pihak Pengurusan terhadap kekurangan utama dalam kawalan atau prosedur yang telah dikenal pasti dan dilaporkan kepada Lembaga Pengarah. mengkaji penemuan audit utama dan tindakan Pengurusan sepanjang tahun dengan pihak Pengurusan, juruaudit luar dan juruaudit dalaman termasuk status syor-syor audit yang terdahulu. mengkaji kebebasan dan objektif juruaudit luar dan perkhidmatan mereka, termasuk perkhidmatan bukan audit dan yuran profesional, untuk memastikan keseimbangan yang betul antara objektif dan nilai untuk wang. The Committee shall have direct communication channels with the internal and external auditors, the risk management personnel and with Senior Management of the Group and shall be able to convene meetings with the external auditors, the internal auditors or both, excluding the attendance of other directors and employees of the Company, whenever deemed necessary. Where the Committee is of the view that a matter reported by it to the Board has not been satisfactorily resolved resulting in a breach of Bursa Malaysia Listing Requirements, the Committee shall promptly report such matter to the Bursa Malaysia. Duties and Responsibilities The primary objective of the Committee is to provide an independent oversight of Malaysia s financial reporting and internal control system and ensuring checks and balances within Malaysia. Therefore, the duties and responsibilities of the Committee include the followings: to review with the external auditor and report to the Board, the audit scope and plan, including any changes to the planned scope of the external audit plan and evaluation of the system of internal control. to review the adequacy of the internal audit scope and plan, functions, competency and resources of the internal audit functions and that it has the necessary authority to carry out its work. to review the external and internal audit reports to ensure that appropriate and prompt remedial action is taken by Management on major deficiencies in controls or procedures that are identified and reported to the Board. to review the major audit findings and Management s response during the year with Management, external auditors and internal auditors, including the status of previous audit recommendations. to review the independence and objectivity of the external auditors and their services, including non-audit services and the professional fees, so as to ensure a proper balance between objectivity and value for money. to review the appointment, performance, audit fees and any question regarding the resignation or dismissal of external auditors before making recommendations to the Board.

37 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 035 Laporan Jawatankuasa Audit Audit Committee Report mengkaji pelantikan, prestasi, yuran audit dan sebarang persoalan berhubung peletakan jawatan atau pemecatan juruaudit luar sebelum memberi cadangan kepada Lembaga Pengarah. mengkaji keputusan suku tahunan dan penyata kewangan akhir tahun, sebelum kelulusan Lembaga Pengarah dengan menumpu terutamanya kepada: - perubahan atau pelaksanaan dasar dan praktis perakaunan utama; - pelarasan ketara dan peristiwa penting dan luar biasa timbul dari audit; - andaian perniagaan berterusan; dan - pematuhan kepada standard kewangan, Bursa Malaysia dan keperluan undang-undang. mengkaji penyata Pengerusi dan pemberitahuan urus tadbir korporat yang dibuat dalam Laporan Pengarah. membincangkan masalah dan persoalan yang wujud dari audit interim dan akhir dan sebarang perkara yang ingin dibincangkan oleh juruaudit (tanpa kehadiran pihak Pengurusan jika perlu). mengkaji Piagam Audit Dalaman, belanjawan dan komposisi kakitangan Bahagian Audit Dalaman. mengkaji kawalan dalaman, termasuk skop urus tadbir, prosedur, penemuan audit dalaman, dan mencadangkan tindakan yang perlu diambil oleh Pengurusan. Laporan audit dalaman tidak tertakluk kepada kebenaran daripada Ketua Pegawai Eksekutif/ Pengarah Urusan Kumpulan atau Pengarah Eksekutif. mengarah dan sekiranya wajar, menyelia sebarang projek atau siasatan khas jika perlu, dan mengkaji laporan siasatan berkenaan sebarang penyalahgunaan, penipuan dan kecurian yang besar. memastikan akaun disediakan tepat pada masanya dan dengan cara yang tepat bagi tujuan pengawalseliaan, pengurusan dan laporan umum, dengan ulasan yang selalu dijalankan terhadap kecukupan peruntukan yang telah dibuat. mengkaji sebarang urusniaga pihak berkaitan dan situasi konflik kepentingan yang mungkin timbul dalam Syarikat atau Kumpulan, termasuk sebarang urusniaga, prosedur atau tatacara yang menimbulkan persoalan terhadap kewibawaan pihak Pengurusan. memastikan bahawa isu-isu penyeliaan yang dibangkitkan oleh Bank Negara Malaysia diselesaikan tepat pada masanya. to review the quarterly and year end financial statements, before the approval by the Board, focusing particularly on: - changes in or implementation of major accounting policy and practice; - significant adjustments and unusual event arising from the audit; - the going concern assumption; and - compliance with accounting standards, Bursa Malaysia and other legal requirements. to review the Chairman s statement and corporate governance disclosures made in the Directors Report. to discuss problems and reservations arising from the interim and final audits, and any matter the auditor may wish to discuss (in the absence of Management where necessary). to review the Internal Audit Charter, budget and staffing of the Internal Audit Division. to review internal controls, including the scope of the internal audit governance, procedures, findings, and recommend action to be taken by Management. The internal audit reports should not be subject to the clearance of the Chief Executive Officer/Group Managing Director or Executive Directors. to direct and where appropriate supervise any special projects or investigation considered necessary, and review investigation report on any major defalcation, frauds and thefts. to ensure that the accounts are prepared in a timely and accurate manner for regulatory, management and general reporting purposes, with regular reviews carried out on the adequacy of provisions made. to review any related party transaction and conflict of interest situation that may arise within the Company or the Group, including any transaction, procedure or course of conduct that raises questions of management integrity. to ensure that supervisory issues raised by Bank Negara Malaysia are resolved in a timely manner. to perform any other functions as may be agreed by the Board. melaksanakan sebarang fungsi lain yang mungkin dipersetujui oleh Lembaga Pengarah.

38 036 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Laporan Jawatankuasa Audit Audit Committee Report RINGKASAN AKTIVITI-AKTIVITI JAWATANKUASA Aktiviti-aktiviti yang telah dijalankan oleh Jawatankuasa sepanjang tahun kewangan yang dikaji termasuk: Mengkaji dan memantau dengan juruaudit luar, keputusan dan perkembangan audit bagi tahun kewangan berakhir 31 Disember 2011, laporan audit dan surat Pengurusan, termasuk tindakan Pengurusan berkaitannya. Berbincang mengenai pelantikan semula juruaudit luar bagi tahun kewangan berakhir 31 Disember 2012 dan menilai kesesuaian dan kebebasan mereka untuk pelantikan semula. Mengkaji skop kerja dan rancangan audit juruaudit luar bagi tahun kewangan berakhir 31 Disember Sebelum audit dijalankan, wakil-wakil juruaudit luar telah membentangkan strategi dan rancangan audit. Berbincang mengenai yuran audit yang perlu dibayar kepada juruaudit luar. Berbincang dengan juruaudit luar berhubung sebarang perkara yang memerlukan perhatian Lembaga Pengarah dan Pemegang Saham tanpa kehadiran ahli Lembaga Pengarah Eksekutif dan pihak Pengurusan. Mengkaji Pelan Strategik Audit Dalaman bagi tahun kewangan 2013 dan 2014 (termasuk perancangan tenaga kerja, cadangan jadual latihan dan bidang-bidang utama/penting yang akan diaudit dalam tempoh dua tahun akan datang). Mengkaji laporan audit dalaman dan audit khas (seperti Laporan-Laporan Audit Kewangan, Operasi dan Teknologi Maklumat) yang menekankan isu-isu audit cadangan dan maklum balas pihak Pengurusan yang berkaitan. Berbincang dengan Pengurusan mengenai tindakan yang telah dan akan diambil untuk mempertingkatkan sistem kawalan dalaman berdasarkan peluang-peluang penambahbaikan yang telah dikenal pasti dalam laporan audit dalaman. Mengkaji laporan susulan oleh juruaudit dalaman mengenai status tindakan yang diambil oleh pihak Pengurusan terhadap cadangan yang diberikan dalam laporan audit. Mengkaji laporan susulan oleh juruaudit dalaman berhubung isu-isu yang dibangkitkan berdasarkan penemuan daripada pemeriksaan oleh BNM dan status tindakan yang diambil oleh pihak Pengurusan mengenai isu yang dibangkitkan oleh BNM. SUMMARY OF ACTIVITIES OF THE COMMITTEE The activities undertaken by the Committee during the financial year under review include the following: Reviewed and monitored with the external auditors, the results and progress of the audit for the financial year ended 31 December 2011, the audit report and the Management letter, including Management s response thereto. Discussed the re-appointment of external auditors for the financial year ended 31 December 2012 and assessed their suitainability and independence for re-appointment. Reviewed the external auditors scope of work and audit plans for the financial year ended 31 December Prior to the audit, representatives from the external auditors presented their audit strategy and plan. Discussed the audit fees payable to the external auditors. Discussed with external auditors any matters that warrant the Board and Shareholders attention without the presence of the member of the Executive Directors and Management. Reviewed the Internal Audit Strategic Plan for financial years 2013 and 2014 (including manpower planning, proposed training schedule and key areas to be reviewed within the next two years). Reviewed the internal audit reports and special audit reports (i.e. Finance, Operational and IT Audit Reports) which highlighted the audit issues, recommendations and Management s response thereto. Discussed with Management on actions taken or to be taken to improve the system of internal control based on improvement opportunities identified in the internal audit reports. Reviewed follow-up reports by the internal auditors on the status of actions taken by the Management on recommendations suggested in the audit reports. Reviewed follow-up reports by the internal auditors on BNM s examination findings and status of actions taken by the Management on issues raised by BNM.

39 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 037 Laporan Jawatankuasa Audit Audit Committee Report Mengkaji laporan susulan oleh juruaudit dalaman berhubung isu yang dibangkitkan dalam surat Pengurusan oleh juruaudit luar dan status tindakan yang diambil oleh pihak Pengurusan mengenai isu tersebut. Mengkaji penyata kewangan Syarikat yang telah diaudit sebelum diserahkan kepada Lembaga Pengarah bagi pertimbangan dan kelulusan mereka. Kajian ini adalah untuk memastikan supaya penyata kewangan yang telah diaudit disediakan mengikut peruntukan Akta Syarikat 1965 dan piawaian perakaunan berkaitan yang diluluskan. Mengkaji laporan Pematuhan mengenai tahap pematuhan dengan keperluan Pihak Penguatkuasa, undang-undang dan Akta, termasuk Pelan Kerja Pematuhan bagi tahun Mengkaji pengumuman keputusan kewangan suku tahunan yang belum diaudit sebelum disyorkan kepada Lembaga Pengarah untuk kelulusan. Mengkaji urusniaga pihak yang berkaitan dalam Kumpulan. Menyediakan bimbingan ke atas penyediaan penyata pendedahan dalam Laporan Tahunan seperti Penyata Urus Tadbir Korporat, Penyata Pengurusan Risiko dan Kawalan Dalaman dan Laporan Jawatankuasa Audit dalam mematuhi Keperluan Penyenaraian Bursa Malaysia dan Suruhanjaya Sekuriti. Mengkaji Laporan Tahunan myal-afdhal dan Laporan Tahunan Dana Berkaitan Pelaburan. FUNGSI DAN AKTIVITI-AKTIVITI AUDIT DALAMAN Bahagian Audit Dalaman adalah bebas daripada aktiviti atau operasi unit-unit operasi lain dan melapor terus kepada Jawatankuasa Audit. Peranan utama bahagian ini adalah untuk menjalankan kajian sistem kawalan dalaman secara bebas, kerap dan sistematik supaya dapat memberi jaminan yang sewajarnya bahawa sistem tersebut mampu terus beroperasi secara berkesan dan memuaskan. Audit dalaman mengamalkan pendekatan berasaskan risiko dalam rancangan audit dan pemeriksaannya. Adalah menjadi tanggungjawab Bahagian Audit Dalaman untuk menyediakan laporan bebas dan objektif kepada Jawatankuasa tentang status kawalan dalaman di pelbagai unit operasi dalam Kumpulan serta tahap pematuhan unit-unit tersebut terhadap dasar dan prosedur Kumpulan serta terhadap keperluan berkanun yang berkaitan. Reviewed follow-up reports by the internal auditors on external auditors findings as set out in the Management letter and status of actions taken by the Management on issues raised by the external auditors. Reviewed the audited financial statements of the Company prior to submission to the Board for their consideration and approval. The review was to ensure that the audited financial statements were drawn up in accordance with the provisions of the Companies Act 1965 and the applicable approved accounting standards. Reviewed the Compliance reports on the level of compliance with Regulators requirements, laws and Acts, including Compliance Work Plan for Reviewed the quarterly unaudited financial results announcements before recommending them for the Board s approval. Reviewed related party transactions within the Group. Reviewed the disclosure statements in the Annual Report such as Corporate Governance Statement, Statement on Risk Management and Internal Control and Audit Committee Report in compliance with Bursa Malaysia Listing Requirements and Securities Commission. Reviewed the myal-afdhal Annual Report and Investment- Linked Funds Annual Report. INTERNAL AUDIT FUNCTION AND ACTIVITIES The Internal Audit Division is independent of the activities or operations of other operating units and reports directly to the Audit Committee. The principal role of the division is to undertake independent regular and systematic reviews of the systems of internal controls so as to provide reasonable assurance that such systems continue to operate satisfactorily and effectively. The internal audit practices a risk-based approach in its audit plan and examination. It is the responsibility of the Internal Audit Division to provide the Committee with independent and objective reports on the state of internal control of the various operating units within the Group and the extent of compliance of the units with the Group s established policies and procedures as well as relevant statutory requirements.

40 038 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Laporan Jawatankuasa Audit Audit Committee Report Aktiviti-aktiviti berikut telah dijalankan oleh Bahagian Audit Dalaman dalam tahun kewangan yang dikaji: Melaksanakan peranan jaminan bebas dengan membuat ulasan kajian berjadual ke atas keberkesanan, kecekapan dan mekanisma kawalan ekonomi untuk mengutarakan risiko dan keutamaan dalam bidang operasi, kewangan, teknologi maklumat, pembangunan produk, pelaburan dan fungsi-fungsi strategik yang menggunapakai pendekatan audit berasaskan risiko seperti yang dinyatakan dalam Pelan Audit Rasmi dua tahun (Tahun Kewangan Berakhir 2011 dan 2012). Menyediakan jaminan yang munasabah ke atas tahap pematuhan polisi dan prosedur yang telah disediakan di samping keperluan statutori BNM dan badan-badan perundangan lain. Memberi khidmat nasihat kepada Pengurusan dan subsidiari Syarikat. Mencadangkan peningkatan ke atas proses perniagaan dan penambahbaikan bagi sistem kawalan dalaman yang sedia ada. Menjalankan audit susulan berhubung status tindakan yang diambil oleh Pengurusan berdasarkan cadangan yang dibuat dalam penemuan audit juruaudit dalaman, juruaudit luar, pegawai pemeriksa BNM dan lain-lain. Menjalankan semakan khas dan penyiasatan seperti yang diminta oleh Pengurusan Kanan dan pengesahan daripada Pengerusi Jawatankuasa Audit. Mengkaji semula kecukupan dan kesesuaian kawalan dalaman dan pendedahan risiko di dalam pakej produk baru berdasarkan semakan semula Rangka Kerja Pembangunan Produk. Menyediakan bimbingan dan nasihat kepada Jawatankuasa Pemandu Projek sebelum pelancaran produk baru dan lama. Menjalankan semakan ke atas penyediaan sistem teknologi maklumat, ujian dan penggunaan sebelum ianya dilaksanakan. Menjalankan audit ke atas perkakasan komputer, sistem operasi dan aplikasi serta rangkaian teknologi komunikasi maklumat (ICT) Malaysia. Menjadi pemerhati dalam tender dan proses pemilihannya dan dalam Jawatankuasa-jawatankuasa yang lain. Menyemak dan menyediakan bimbingan terhadap latihan Pengurusan Kesinambungan Perniagaan yang dijalankan. The following activities were undertaken by the Internal Audit Division during the financial year under review: Executed independent assurance role by performing scheduled reviews on the effectiveness, efficiency and economical of control mechanism to address risks and concerns in the areas of operations, financial, information technology, product development, investment and strategic functions on a risk based audit approach as set out in the Formalised Two-Year Audit Plan (FYE 2011 and 2012). Provided reasonable assurance on the extent of compliance with established policies and procedures as well as BNM statutory requirements and other regulatory bodies. Rendered advisory services to the Management of the Company and its subsidiaries. Recommended improvements to the business processes and enhancement to the existing system of internal controls. Conducted follow-up audit on status of actions taken by the Management on recommendations suggested in audit reports of internal auditors, external auditors, BNM examiners, etc. Carried out special reviews and investigations as requested by Senior Management and endorsement from the Audit Committee Chairman. Reviewed the adequacy and appropriateness of the internal controls and risk exposures in the new product packages based on the revised Product Development Framework (PDF). Provided guidance and advices to the Project Steering Committee for new and revised products before launching. Conducted reviews on IT system set-ups, tests and deployments before embarking into production. Conducted audit computer hardware, operating and application systems as well as the information communication technology (ICT) network of Malaysia. Participated in tender and selection process and other Committees in the capacity of an observer. Reviewed and provided guidance on the Business Continuity Management exercise conducted.

41 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 039 Laporan Jawatankuasa Audit Audit Committee Report Menyemak dan mengumpul data-data terkini Supervisory Concern sebelum diserahkan kepada Bank Negara Malaysia. Mengkaji semula aktiviti khidmat luar terhadap Syarikat. Membimbing Pengurusan dalam menyediakan Laporan Jawatankuasa Audit dan Penyata Kawalan Dalaman untuk dizahirkan dalam Laporan Tahunan. Mengkaji Laporan Tahunan myal-afdhal dan Laporan Tahunan Dana Berkaitan Pelaburan. Laporan daripada tugasan audit dikemukakan kepada pihak Pengurusan untuk perhatian dan tindakan pembetulan yang perlu seperti yang dicadangkan. Pihak Pengurusan bertanggungjawab memastikan tindakan pembetulan terhadap kelemahan yang dilapor dilaksanakan dalam jangka masa yang ditetapkan. Jumlah kos yang terbabit bagi mengekalkan fungsi Audit Dalaman yang dilakukan secara dalaman bagi tahun kewangan yang dikaji adalah lebih kurang RM2.0 juta di mana ia merangkumi sebahagian besarnya adalah gaji, elaun perjalanan dan penginapan dan elaun sara hidup bagi menjalankan tugasan audit. Reviewed and compiled the updates on the Supervisory Concerns prior to submission to Bank Negara Malaysia. Reviewed the outsourcing activities for the Company. Assisted Management in preparing the Audit Committee Report and Statement on Risk Management and Internal Control for disclosure in the Annual Report. Reviewed the myal-afdhal Annual Report and Investment- Linked Funds Annual Report. Reports from the audit assignments are forwarded to the Management for attention and necessary corrective actions as recommended. The Management is responsible for ensuring that corrective actions on reported weaknesses are taken within the required time frame. The costs incurred in maintaining the Internal Audit function which is performed inhouse for the financial year under review was approximately RM2.0 million comprising mainly salaries, travelling and accommodation expenses and subsistence allowance for audit assignments.

42 040 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Penyata Urus Tadbir Korporat Corporate Governance Statement Lembaga Pengarah Syarikat Malaysia Berhad ( Malaysia ) terus mematuhi dan menyokong sepenuhnya Kod Urus Tadbir Korporat Malaysia 2012 ( MCCG 2012) ) dan sentiasa komited dalam memastikan supaya Prinsip-prinsip dan Cadangancadangan dipatuhi dan diamalkan oleh keseluruhan Kumpulan bagi membolehkan urus selia hal-ehwal Kumpulan dikendalikan secara profesional, bertanggungjawab dan berwibawa dengan objektif untuk melindungi dan mempertingkatkan nilai pelaburan pemegang saham dan prestasi kewangan Kumpulan. Lembaga Pengarah dengan ini berbesar hati melaporkan pelaksanaan penggunaan Prinsip-prinsip MCCG 2012 dan sejauh mana Kumpulan telah mematuhi Cadangan-cadangan oleh MCCG 2012 sebagaimana yang ditetapkan menurut MCCG 2012 dan Keperluan Penyenaraian Pasaran Utama Bursa Malaysia Securities Berhad ( Keperluan Penyenaraian Bursa Malaysia ) sepanjang tahun kewangan yang dikaji. PENGARAH Lembaga Pengarah Lembaga Pengarah bertanggungjawab terhadap keseluruhan aspek urus tadbir korporat Kumpulan dan juga diamanahkan dengan tanggungjawab dalam melaksanakan penjagaan yang sewajarnya ke atas Syarikat serta sumber-sumber Kumpulan bagi memelihara kepentingan para pemegang saham dan memastikan pengurusan perniagaan yang sewajarnya. Mesyuarat Lembaga Pengarah Mesyuarat Lembaga Pengarah dijadualkan terlebih dahulu pada permulaan tahun kalendar dengan mesyuarat tambahan diadakan bila perlu. Lapan (8) mesyuarat Lembaga Pengarah telah diadakan pada tahun kewangan yang dikaji dengan butiran kehadiran setiap Pengarah seperti berikut: The Board of Directors ( the Board ) of Syarikat Malaysia Berhad ( Malaysia ) continues to subscribe and fully support the Malaysian Code on Corporate Governance 2012 ( MCCG 2012 ) and is committed to ensure that the Principles and Recommendations are observed and practised throughout the Group so that the affairs of the Group are conducted with professionalism, accountability and integrity with the objective of safeguarding and enhancing shareholders value and financial performance of the Group. The Board is pleased to report on the application of the Principles of the MCCG 2012 and the extent of compliance with the Recommendations of the MCCG 2012 as required under the MCCG 2012 and the Main Market Listing Requirements of Bursa Malaysia Securities Berhad ( Bursa Malaysia Listing Requirements ) during the financial year under review. DIRECTORS The Board The Board is responsible for the overall corporate governance of the Group and is also entrusted with the responsibility of exercising reasonable care of the Company as well as Group s resources in the best interests of its shareholders and in ensuring the proper conduct of business. Board Meetings Board meetings are scheduled in advance at the beginning of a calendar year with additional meetings convened when necessary. Eight (8) Board meetings were held during the financial year under review with details of meetings attendance of each Director as follows:

43 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 041 Penyata Urus Tadbir Korporat Corporate Governance Statement Nama / Kehadiran / Peratus (%) / Name Attendance Percentage (%) Y. Bhg. Dato Paduka Ismee Ismail (Pengarah Bukan Eksekutif Bukan Bebas / Non-Independent Non-Executive Director) 8/8 100 Y. Bhg. Dato Mohamed Hassan Md Kamil (Pengarah Eksekutif Bukan Bebas / Non-Independent Executive Director) 8/8 100 Puan Rozaida Omar (Pengarah Bukan Eksekutif Bukan Bebas / Non-Independent Non-Executive Director) 7/8 88 Encik Mahadzir Azizan (Pengarah Bukan Eksekutif Bebas Kanan / Senior Independent Non-Executive Director) 8/8 100 Y. Bhg. Dato Sulaiman Mohd Yusof (Pengarah Bukan Eksekutif Bebas / Independent Non-Executive Director) 8/8 100 Encik Johan Abdullah (Pengarah Bukan Eksekutif Bukan Bebas / Non-Independent Non-Executive Director) 8/8 100 Encik Zakaria Ismail (Pengarah Bukan Eksekutif Bebas / Independent Non-Executive Director) 6/8 75 Y. Bhg. Dato Othman Abdullah (Dilantik pada 1 Disember 2012 / Appointed on 1 December 2012) t/b t/b (Pengarah Bukan Eksekutif Bebas / Independent Non-Executive Director) n/a n/a t/b tidak berkenaan kerana mesyuarat tidak diadakan selepas tarikh pelantikan pada 1 Disember 2012 sehingga 31 Disember n/a not applicable as the meeting was not held after the appointment date on 1 December 2012 until 31 December Lembaga Pengarah berpuas hati dengan tahap komitmen masa yang diberikan oleh para Pengarah ke arah memenuhi peranan dan tanggungjawab mereka sebagai Pengarah Malaysia seperti yang tertera di dalam rekod kehadiran para Pengarah di dalam mesyuarat Lembaga Pengarah, sebagaimana yang dinyatakan dalam jadual di atas. Semua Pengarah memiliki latar belakang pengalaman kerja yang luas dalam pelbagai bidang, dan dengan ini membolehkan mereka membuat pertimbangan yang sewajarnya dalam melaksanakan tugas mereka. Piagam Lembaga Pengarah Lembaga Pengarah berpandu kepada Terma Rujukan ( Piagam ) yang menggariskan peranan dan tanggungjawab Lembaga Pengarah. Lembaga Pengarah akan mengkaji Piagam dari semasa ke semasa bagi memastikan ianya selari dengan perubahan dalam peraturanperaturan dan amalan terbaik dan memastikan ianya berkesan dan relevan dengan objektif Lembaga Pengarah. Kod Etika Lembaga Pengarah Para Pengarah mematuhi kod etika selaras dengan Kod Etika Pengarah Syarikat yang dibentuk oleh Suruhanjaya Syarikat Malaysia. The Board is satisfied with the level of time commitment given by the Directors towards fulfilling their roles and responsibilities as Directors of Malaysia as evidenced by the attendance record of the Directors at Board meetings, as set out in the above table. All Directors have the backing of extensive work experience in various fields and therefore able to exercise independent judgement in order to discharge their duties. Board Charter The Board is guided by its Terms of Reference ( Charter ) which set out the roles and responsibilities of the Board. The Board will regularly review the Charter to keep it up to date with changes in regulations and best practices and ensure its effectiveness and relevance to the Board s objectives. Directors Code of Ethics The Directors observe the code of ethics in accordance with the Company Directors Code of Ethics established by the Companies Commission of Malaysia.

44 042 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Penyata Urus Tadbir Korporat Corporate Governance Statement Keseimbangan Lembaga Pengarah dan Kebebasan Pengarah Sepanjang tahun kewangan yang dikaji, Lembaga Pengarah terdiri daripada: Board Balance and Independence of Directors During the financial year under review, the Board comprises the following: Nama / Komposisi / Peratus(%) / Name Composition Percentage (%) Pengarah Eksekutif Bukan Bebas / Non-Independent Executive Director 1/ Pengarah Bukan Eksekutif Bukan Bebas / Non-Independent Non-Executive Directors 3/ Pengarah Bukan Eksekutif Bebas / Independent Non-Executive Directors 4/ * Komposisi di atas adalah selepas pelantikan Y. Bhg. Dato Othman Abdullah pada 1 Disember * The above composition is after the appointment of Y. Bhg. Dato Othman Abdullah on 1 December Komposisi di atas mematuhi Keperluan Penyenaraian Bursa Malaysia yang mewajibkan satu pertiga (1/3) daripada para Pengarah Malaysia terdiri daripada Pengarah Bebas. Salah satu cadangan MCCG 2012 menyatakan bahawa Lembaga Pengarah mesti terdiri daripada majoriti Pengarah Bebas jika Pengerusi Lembaga Pengarah bukan merupakan seorang Pengarah Bebas. Lembaga Pengarah membincangkan mengenai perkara ini dan bersetuju bahawa bilangan Pengarah Bebas akan dikekalkan pada 50% daripada ahli-ahli Lembaga Pengarah kerana Lembaga Pengarah merasakan adanya keperluan keseimbangan ahli Lembaga Pengarah bagi memastikan kepentingan pelabur institusi iaitu Lembaga Tabung Haji, yang merupakan pemegang saham utama ultimate Malaysia dilindungi. Lembaga Pengarah telah menerima pakai polisi sembilan tahun bagi Pengarah Bukan Eksekutif Bebas dalam bulan Ogos 2011 sebelum penerbitan MCCG Tempoh untuk semua empat orang Pengarah Bukan Eksekutif Bebas tidak melebihi tempoh kumulatif sembilan (9) tahun seperti yang disyorkan oleh MCCG Mereka terus memenuhi definisi bebas seperti yang dinyatakan di dalam Keperluan Penyenaraian Bursa Malaysia. Oleh itu, memandangkan semua empat Pengarah Bukan Eksekutif Bebas menawar pelantikan semula di bawah Artikel 62 dan 66A Tataurusan Pertubuhan Syarikat pada AGM yang ke- 28 akan datang, Lembaga Pengarah mencadangkan dan menyokong cadangan pelantikan semula mereka. Rangka Tindakan Urus Tadbir Korporat 2011 menyatakan matlamat untuk mencapai 30% penyertaan wanita di dalam Lembaga Pengarah menjelang tahun 2016 dan kemajuan ke arah matlamat ini akan dipantau dan dinilai pada tahun Lembaga Pengarah Malaysia kini mempunyai seorang ahli wanita dari lapan ahli (iaitu 12.5%) sejak Mei 2007 manakala Badan Penasihat Syariah juga mempunyai seorang ahli wanita daripada lima orang ahli (iaitu 20%) sejak Mac The above composition is in compliance with Bursa Malaysia Listing Requirements which require that one third (1/3) of Directors of Malaysia to be Independent Directors. One of the recommendations of the MCCG 2012 states that the Board must comprise a majority of Independent Directors where the Chairman of the Board is not an Independent Director. The Board deliberated on this matter and agreed for the number of Independent Directors to be maintained at 50% of the Board members as the Board feel that there is a need for a balanced Board members to ensure that the interest of the institutional investor i.e. Lembaga Tabung Haji, which is the ultimate major shareholder of Malaysia is protected. The Board has adopted a nine-year policy for Independent Non- Executive Directors in August 2011 i.e. before the issuance of MCCG The tenure of all the four Independent Non-Executive Directors do not exceed a cumulative term of nine (9) years as recommended by the MCCG They continue to fulfill the definition of independence as set out in the Bursa Malaysia Listing Requirements. Therefore, since all the four Independent Non-Executive Directors are seeking reappointment under Article 62 and 66A of the Company s Articles of Association at forthcoming 28th AGM, the Board recommends and supports their proposed re-appointment. The Corporate Governance Blueprint 2011 stated that the goal is for women participation on Boards to reach 30% by 2016 and the progress towards this goal will be monitored and assessed in Malaysia s Board currently has one women member out of eight members (i.e. 12.5%) since May 2007 while the Shariah Advisory Body also has one women member out of five members (i.e. 20%) since March 2008.

45 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 043 Penyata Urus Tadbir Korporat Corporate Governance Statement Lembaga Pengarah yang mempunyai pelbagai latar belakang dan kepakaran khusus, secara kolektifnya membawa bersama mereka pengalaman dan kepakaran yang luas dalam bidang-bidang seperti kewangan, insurans, aktuari, perakaunan, kesetiausahaan syarikat, perundangan, pengurusan dan perbankan. Profil ahli Lembaga Pengarah ada dibentangkan di muka surat 14 hingga 21 dalam Laporan Tahunan ini. Terdapat pembahagian yang jelas antara tanggungjawab Pengerusi dan Pengarah Urusan Kumpulan bagi memastikan keseimbangan kuasa dan autoriti. Peranan Pengerusi dan Pengarah Urusan Kumpulan ditakrif dengan jelas di mana Pengerusi bertanggungjawab terhadap pengendalian Lembaga Pengarah dan menerajui perbincangan di peringkat Lembaga Pengarah sementara Pengarah Urusan Kumpulan bertanggungjawab terhadap pengurusan Syarikat dan Kumpulan serta pelaksanaan dasar dan keputusan yang telah diputuskan oleh Lembaga Pengarah. Lembaga Pengarah telah mengenalpasti dan melantik Encik Mahadzir Azizan sebagai Pengarah Bukan Eksekutif Bebas Kanan di mana sebarang kemusykilan boleh dirujuk oleh pemegang saham dan pihak berkepentingan lain. Lembaga Pengarah menggalakkan urus tadbir korporat yang baik dalam penglibatan amalan kemampanan khususnya melalui inisiatifinisiatif tanggungjawab sosial korporat / program yang dijalankan oleh Syarikat sepanjang tahun. Jawatankuasa Lembaga Pengarah Dalam memastikan Lembaga Pengarah melaksanakan tugas mereka dengan lebih berkesan di samping meningkatkan perniagaan dan kecekapan operasi, Lembaga Pengarah mengagihkan tanggungjawab tertentu kepada empat (4) Jawatankuasa Lembaga Pengarah, iaitu: Jawatankuasa Audit Jawatankuasa Pemilihan Jawatankuasa Ganjaran; dan Jawatankuasa Risiko Lembaga Pengarah Setiap Jawatankuasa mempunyai terma rujukan bertulis yang jelas dan Lembaga Pengarah menerima laporan bagi setiap persidangan dan pertimbangan Jawatankuasa tersebut. Pengerusi bagi setiap Jawatankuasa akan melaporkan kepada Lembaga Pengarah setiap keputusan dari mesyuarat yang dijalankan dan laporan tersebut akan dimasukkan ke dalam minit Mesyuarat Lembaga Pengarah. The Board with their different backgrounds and specialisations, collectively bring with them a wide range of experience and expertise in areas such as finance, insurance, actuary, accounting, company secretarial, legal, management and banking. The profiles of the Directors are provided on pages 14 to 21 of the Annual Report. There is a clear division of responsibilities between the Chairman and the Group Managing Director to ensure that there is a balance of power and authority. The roles of the Chairman and Group Managing Director are clearly defined with the Chairman being responsible for running the Board and lead the discussion at the Board level whilst the Group Managing Director is responsible for managing the Company and the Group as well as the implementation of the Board s policies and decisions. The Board has identified and appointed Encik Mahadzir Azizan as a Senior Independent Non-Executive Director to whom concerns may be conveyed by shareholders and other stakeholders. The Board promotes good corporate governance in the application of sustainability practices particularly through the corporate social responsibility initiatives/programs undertaken by the Company throughout the year. Board Committees To enable the Board to discharge its duties effectively whilst enhancing business and operational efficacy, the Board delegates certain responsibilities to four (4) Board Committees, namely: Audit Committee Nomination Committee Remuneration Committee; and Board Risk Committee All Committees have clear written terms of reference and the Board receives reports of their proceedings and deliberations. The Chairman of the various Committees will report to the Board the outcome of their meetings and such reports are incorporated in the minutes of the Board meeting. The Committees membership are based on Directors skills and experience as well as their ability to add value to the Committees. Keahlian Jawatankuasa adalah bergantung kepada kemahiran dan pengalaman seseorang Pengarah serta kebolehan mereka memberi nilai tambah kepada Jawatankuasa.

46 044 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Penyata Urus Tadbir Korporat Corporate Governance Statement Badan Penasihat Syariah Badan Penasihat Syariah telah diberi kepercayaan oleh Lembaga Pengarah bagi memastikan operasi dan produk yang ditawarkan oleh Kumpulan adalah berlandaskan Syariah. Kesemua perkara yang memerlukan pandangan dan keputusan Badan Penasihat Syariah akan dibentangkan di dalam mesyuarat Badan Penasihat Syariah di mana ianya juga dihadiri oleh pihak Pengurusan dan wakil dari Bahagian Syariah. Kemudian, perkara tersebut akan dibawa kepada Lembaga Pengarah untuk memaklumkan keputusan yang telah dibuat. Badan Penasihat Syariah terdiri daripada lima (5) orang ahli di mana kesemuanya mempunyai pengalaman dan kepakaran yang diperlukan di dalam bidang masing-masing. Y. Bhg. Dr. Ahmad Sobri Salamon merupakan Pengerusi Badan Penasihat Syariah sekarang. Enam (6) mesyuarat Badan Penasihat Syariah telah diadakan sepanjang tahun kewangan yang dikaji dengan butiran kehadiran setiap ahli seperti berikut: Shariah Advisory Body The Shariah Advisory Body is entrusted by the Board to ensure that the Group s operations and products offered are in accordance with the Shariah. All matters which require the Shariah Advisory Body s opinion and decision are deliberated at Shariah Advisory Body meetings with the attendance of the Management and representatives from the Shariah Division. Thereon, the said matters are brought to the attention of the Board for an informed decision making. The Shariah Advisory Body consists of five (5) members, all of whom have the necessary experiences and expertise in their respective fields. The current Chairman of the Shariah Advisory Body is Y. Bhg. Dr. Ahmad Sobri Salamon. The Shariah Advisory Body meets six (6) times during the financial year under review with details of meetings attendance of each member as follows: Nama / Kehadiran / Peratus (%) / Name Attendance Percentage (%) Y. Bhg. Dr. Ahmad Sobri Salamon 5/6 83 Y. Bhg. Ustaz Mohd Bakir Hj. Mansor 6/6 100 Y. Bhg. Dr. Aida Othman 6/6 100 Y. Bhg. Prof. Madya Dr. Muhamad Rahimi Osman 6/6 100 Y. Bhg. Dato Wan Mohamad Dato Sheikh Abdul Aziz 5/6 83 Polisi Pemberitahuan Maklumat dan Polisi Penipuan & Integriti Syarikat telah mewujudkan Polisi Pemberitahuan Maklumat lanjutan daripada Akta Perlindungan Pemberi Maklumat, 2010 dengan objektif seperti berikut:- 1) Untuk membolehkan pekerja-pekerja menyuarakan apa-apa kemusykilan mengenai integriti dan salah laku disamping membolehkan Lembaga Pengarah diberitahu pada peringkat awal mana-mana salah laku atau perbuatan yang tidak sopan; 2) Untuk melindungi pekerja-pekerja daripada hukuman atau perlakuan yang tidak adil akibat menyuarakan kemusykilan dengan cara yang betul selaras dengan Polisi; dan 3) Untuk membentuk budaya keterbukaan, akauntabiliti dan integriti dalam Syarikat. Whistle Blowing Policy and Fraud & Integrity Policy The Company has established the Whistle Blowing Policy in response to the Whistleblower Protection Act, 2010 with the following objectives:- 1) To enable the employees to raise any concerns of integrity and misconduct as well as to enable the Board to be informed at an early stage of any misconduct or improprieties; 2) To protect the employees from punishment or unfair treatment for disclosing concerns in good faith in accordance with the Policy; and 3) To develop a culture of openness, accountability and integrity within the Company.

47 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 045 Penyata Urus Tadbir Korporat Corporate Governance Statement Di samping itu, Syarikat juga telah mewujudkan Polisi Penipuan & Integriti untuk memudahkan perkembangan kawalan yang akan membantu dalam pengesanan dan pencegahan penipuan terhadap Syarikat secara dalaman dan luaran. Objektif Polisi Penipuan & Integriti adalah seperti berikut:- 1) Bagi memastikan tindakan segera dan konsisten serta memastikan keberkesanan dan keberkaitan kawalan dalaman dalam mengurangkan risiko penipuan; 2) Untuk melindungi Syarikat dari kerugian kewangan, kerosakan reputasi serta menanam keyakinan peserta-peserta dan pihak berkepentingan lain; dan 3) Untuk membolehkan Pengurusan memberi tumpuan kepada pencapaian strategi perniagaan dan sasaran. Kedua-dua Polisi di atas boleh diperolehi di portal Syarikat. Sumber Maklumat kepada Lembaga Pengarah Lembaga Pengarah mempunyai akses penuh dan secukupnya kepada maklumat berkenaan kertas Lembaga Pengarah yang diedarkan sebelum mesyuarat agar Pengarah boleh mendapatkan penjelasan lanjut, apabila diperlukan bagi mendapatkan penerangan yang sewajarnya sebelum mesyuarat. Kertas Lembaga Pengarah merangkumi minit mesyuarat Lembaga Pengarah yang lalu, minit mesyuarat semua Jawatankuasa Lembaga Pengarah dan laporan yang berkaitan isu-isu mesyuarat yang meliputi kewangan, pelaburan, teknologi maklumat, operasi, sumber manusia dan perkara berkaitan dengan pematuhan peraturan. Pengarah Urusan Kumpulan akan memaklumkan kepada Lembaga Pengarah tepat pada masanya, berhubung semua isu penting yang boleh mempengaruhi prestasi Kumpulan dan pembangunan utama yang berlaku dalam Kumpulan. Pengurusan Kanan dijemput untuk menghadiri mesyuarat Lembaga Pengarah apabila diperlukan bagi membentangkan dan menerangkan perkara-perkara/laporan berkaitan dengan bidang tanggungjawab mereka kepada Lembaga Pengarah. Semua ahli Lembaga Pengarah mempunyai akses yang tidak terhad kepada maklumat yang tepat dan pada masa yang ditetapkan serta khidmat nasihat Setiausaha Syarikat yang bertanggungjawab untuk memastikan supaya prosedur mesyuarat Lembaga Pengarah dituruti dan semua syarat serta peraturan yang diterima pakai dipatuhi. Para Pengarah juga boleh mendapatkan nasihat badan profesional bebas dalam menjalankan tugas mereka, di bawah tanggungan Malaysia. In addition, the Company has also established the Fraud & Integrity Policy to facilitate the development of controls that will aid in the detection and prevention of fraud against the Company internally and externally. The objectives of the Fraud & Integrity Policy are as follows:- 1) To ensure prompt and consistent action as well as to ensure the effectiveness and relevance of internal control in mitigating fraud risk; 2) To safeguard the Company from financial losses, reputation damage as well as to instill confidence of participants and stakeholders; and 3) To enable Management to focus on achieving business strategies and target. Both of the above Policies are available on the Company s portal. Supply of Information to the Board The Board has full and timely access to information with Board papers distributed in advance of meetings to enable the Directors to obtain further explanation, where necessary, in order to be properly briefed before the meetings. The Board papers include the minutes of previous Board meeting, minutes of meetings of all Committees of the Board and reports relevant to the issues of the meetings covering areas such as financial, investment, information technology, operational, human resource and regulatory compliance matters. The Group Managing Director keeps the Board informed, on timely basis, of all material matters affecting the Group s performance and major developments within the Group. The Senior Management are invited to attend the Board meetings to present and brief the Board on matters/reports relating to their areas of responsibility as and when required. All the Board members have unrestricted access to timely and accurate information and access to the advice and services of the Company Secretary, who is responsible for ensuring that Board meeting s procedures are followed and that all applicable rules and regulations are complied with. The Directors can also seek independent professional advice in furtherance of their duties, at Malaysia s expense.

48 046 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Penyata Urus Tadbir Korporat Corporate Governance Statement Pelantikan sebagai ahli Lembaga Pengarah Pelantikan ahli Lembaga Pengarah yang baru dipertimbang dan dinilai oleh Jawatankuasa Pemilihan dan Jawatankuasa tersebut akan mengesyorkan pelantikan tersebut kepada Lembaga Pengarah untuk diluluskan. Selaras dengan Akta, 1984 dan keperluan Bank Negara Malaysia ( BNM ), pelantikan Pengarah adalah tertakluk kepada kelulusan BNM. Setiausaha Syarikat akan memastikan supaya semua pelantikan dilakukan dengan cara yang betul di mana semua maklumat yang diperlukan diperolehi serta semua syarat perundangan dan peraturan dipenuhi. Jawatankuasa Pemilihan Jawatankuasa Pemilihan terdiri daripada lima (5) Pengarah Bukan Eksekutif di mana tiga (3) daripada mereka adalah Pengarah Bebas. Pengerusi Jawatankuasa kini ialah Encik Mahadzir Azizan, seorang Pengarah Bukan Eksekutif Bebas Kanan selaras dengan cadangan MCCG Jawatankuasa Pemilihan telah bermesyuarat sebanyak empat (4) kali sepanjang tahun kewangan yang dikaji dengan butiran kehadiran setiap ahli seperti berikut: Appointment to the Board The appointment of new Board members is considered and evaluated by the Nomination Committee and the Committee would recommend the appointment to the Board for approval. In line with Act, 1984 and the requirement of Bank Negara Malaysia ( BNM ), the appointment of Directors is subject to the approval from BNM. The Company Secretary will ensure that all the appointments are properly made, all necessary information are obtained, as well as all legal and regulatory requirements are met. Nomination Committee The Nomination Committee consists of five (5) Non-Executive Directors, three (3) of whom are Independent Directors. The current Chairman of the Committee is Encik Mahadzir Azizan, a Senior Independent Non- Executive Director, in line with the recommendation of the MCCG The Nomination Committee met four (4) times during the financial year under review with details of meetings attendance of each member as follows: Nama / Kehadiran / Peratus (%) / Name Attendance Percentage (%) Encik Mahadzir Azizan (Pengerusi mulai 23 Mei 2012 / Chairman from 23 May 2012) 4/4 100 Encik Johan Abdullah 4/4 100 Puan Rozaida Omar 3/4 75 Y. Bhg. Dato Sulaiman Mohd Yusof 3/4 75 Encik Zakaria Ismail (Pengerusi sehingga 22 Mei 2012 / Chairman until 22 May 2012) 4/4 100 Jawatankuasa Pemilihan telah diberikan mandat oleh Lembaga Pengarah dan terma rujukannya untuk membentang kepada Pengarah cadangan pemilihan ahli Lembaga Pengarah, Pengarah Urusan Kumpulan/Ketua Pegawai Eksekutif dan Pengurus Besar, dan sentiasa mengkaji syarat-syarat pelantikan Pengarah, Pengarah Urusan Kumpulan/Ketua Pegawai Eksekutif dan Pengurus Besar. Jawatankuasa Pemilihan juga diberi mandat untuk menilai keberkesanan Lembaga Pengarah, Jawatankuasanya dan sumbangan setiap Pengarah. Jawatankuasa Pemilihan juga merangka pelan peralihan jawatan bagi Pengurusan Kanan Malaysia. Penilaian keberkesanan Lembaga Pengarah dan Jawatankuasanya iaitu Jawatankuasa Pemilihan, Jawatankuasa Ganjaran, Jawatankuasa Audit dan Jawatankuasa Risiko Lembaga Pengarah di samping sumbangan setiap Pengarah telah dijalankan pada tahun ini. The Nomination Committee is empowered by the Board and its terms of reference are to bring to the Board recommendations as to the appointment of new Directors, Group Managing Director/Chief Executive Officer and General Managers, and keeps under review the terms of appointment of Directors, Group Managing Director/ Chief Executive Officer and General Managers. The Nomination Committee is also empowered to assess the effectiveness of the Board, its Committees and the contribution of each individual Director. The Nomination Committee also discussed the succession plan of the Senior Management of Malaysia. An assessment of the effectiveness of the Board as a whole and its Committees i.e. Nomination Committee, Remuneration Committee, Audit Committee and Board Risk Committee as well as the contribution of each individual director was carried out during the year.

49 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 047 Penyata Urus Tadbir Korporat Corporate Governance Statement Latihan Pengarah Semua ahli Lembaga Pengarah telah menghadiri Program Latihan Akreditasi Mandatori ( MAP ). Mereka akan terus menghadiri lain-lain program latihan, kursus dan seminar yang relevan untuk mempertingkatkan kemahiran dan pengetahuan mereka dalam menjalankan tugas mereka sebagai Pengarah. Sepanjang tahun ini, para Pengarah telah menghadiri pelbagai kursus latihan yang berkaitan termasuk MINDA Building High Performance Directors Programme (BHPD) 2012, KPMG s Briefing on Optimising IFRS Convergence, Bursa Malaysia s Half Day Governance Programme Governance, Risk Management and Compliance: What Directors Should Know, MINDA s Directors Forum Board Rising to the Challenges of Corporate Entrepreneurship, FIDE Elective Programme - Half-Day Media Skills Program Handling Press Conferences, Media Interviews & Tricky Media Questions, Luncheon Talk - Building a Winning Team: How Cruyff Changed the Game and FIDE Forum: Roundtable Discussion for Members Focusing on the Insurance Industry Where Should a Company Make its Money? Underwriting or Portfolio Management?. Malaysia juga terus menyediakan Pekeliling BNM, Keperluan Penyenaraian Bursa Malaysia yang dikemaskini dan peraturan-peraturan baru lain untuk membantu para Pengarah dalam mendapatkan maklumat mengenai perkembangan terkini. Pemilihan Semula Tataurusan Pertubuhan Syarikat memperuntukkan agar semua Pengarah termasuk Pengarah Urusan Kumpulan/Ketua Pegawai Eksekutif untuk menawarkan diri mereka bagi pemilihan semula sekurang-kurangnya setiap tiga (3) tahun sekali selaras dengan Keperluan Penyenaraian Bursa Malaysia. Bagi membantu para pemegang saham membuat keputusan, maklumat yang mencukupi seperti profil peribadi, kehadiran mesyuarat dan pegangan saham dalam Syarikat bagi setiap Pengarah yang bersedia untuk pemilihan semula disediakan dalam Laporan Tahunan. GANJARAN PENGARAH Peringkat dan Kandungan Ganjaran Jawatankuasa Ganjaran bertanggungjawab mengesyorkan rangka kerja ganjaran bagi para Pengarah termasuk pakej ganjaran bagi Pengarah Eksekutif dan Pengurus Besar kepada Lembaga Pengarah bagi memastikan Malaysia mampu menarik minat, memberi motivasi dan mengekalkan ahli Lembaga Pengarah dan Pengurusan Kanan yang diperlukan untuk mentadbir dengan jayanya. Ganjaran para Pengarah adalah sejajar dengan amalan keseluruhan Kumpulan mengenai ganjaran dan imbuhan. Pengarah Eksekutif tidak terlibat dalam apa juga cara dalam menentukan ganjarannya sendiri. Lembaga Pengarah secara keseluruhannya menentukan ganjaran bagi Pengarah Bukan Eksekutif. Directors Training All Directors have attended the Mandatory Accreditation Programme ( MAP ). The Directors will continue to attend other relevant training programmes, courses and seminars to enhance their skills and knowledge in discharging their duties as Directors. During the year, the Directors attended relevant training courses including MINDA s Building High Performance Directors Programme (BHPD) 2012, KPMG s Briefing on Optimising IFRS Convergence, Bursa Malaysia s Half Day Governance Programme Governance, Risk Management and Compliance: What Directors Should Know, MINDA s Directors Forum Board Rising to the Challenges of Corporate Entrepreneurship, FIDE Elective Programme - Half-Day Media Skills Program Handling Press Conferences, Media Interviews & Tricky Media Questions, Luncheon Talk - Building a Winning Team: How Cruyff Changed the Game and FIDE Forum: Roundtable Discussion for Members Focusing on the Insurance Industry Where Should a Company Make its Money? Underwriting or Portfolio Management?. Malaysia also continued to provide BNM s Circulars, updated Bursa Malaysia Listing Requirements and new regulations to assist the Directors in keeping abreast with the latest development. Re-election The Articles of Association provide for all Directors including the Group Managing Director/Chief Executive Officer to submit themselves for reelection at least every three (3) years in compliance with Bursa Malaysia Listing Requirements. To assist shareholders in their decision, sufficient information, such as personal profile, meetings attendance and shareholding in the Company of each director standing for re-election are furnished in the Annual Report. DIRECTORS REMUNERATION Level and Make-up of Remuneration The Remuneration Committee is responsible in recommending the remuneration framework for the Directors as well as the remuneration package of Executive Director and General Managers to the Board so as to ensure that Malaysia attracts, motivates and retains the Directors and Senior Management needed to run it successfully. The remuneration of Directors is in line with the Group s overall practice on compensation and benefits. The Executive Director does not participate in any way in determining his individual remuneration. The Board as a whole determines the remuneration of Non- Executive Directors.

50 048 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Penyata Urus Tadbir Korporat Corporate Governance Statement Yuran para Pengarah diluluskan oleh para pemegang saham di Mesyuarat Agung Tahunan. Jawatankuasa Ganjaran Jawatankuasa Ganjaran terdiri daripada tiga (3) orang Pengarah Bukan Eksekutif, di mana dua (2) daripada mereka adalah Pengarah Bebas. Pengerusi Jawatankuasa kini ialah Encik Zakaria Ismail, seorang Pengarah Bukan Eksekutif Bebas. Jawatankuasa Ganjaran telah bermesyuarat sebanyak tujuh (7) kali sepanjang tahun kewangan yang dikaji dengan butiran kehadiran setiap ahli seperti berikut: Directors fees are approved by the shareholders at the Annual General Meeting. Remuneration Committee The Remuneration Committee consists of three (3) Non-Executive Directors, two (2) of whom are Independent Directors. The current Chairman of the Committee is Encik Zakaria Ismail, an Independent Non-Executive Director. The Remuneration Committee met seven (7) times during the financial year under review with details of meetings attendance of each member as follows: Nama / Kehadiran / Peratus (%) / Name Attendance Percentage (%) Encik Zakaria Ismail (Pengerusi mulai 23 Mei 2012 / Chairman from 23 May 2012) 7/7 100 Encik Johan Abdullah 7/7 100 Encik Mahadzir Azizan (Pengerusi sehingga 22 Mei 2012 / Chairman until 22 May 2012) 7/7 100 Pendedahan Ringkasan maklumat mengenai ganjaran para Pengarah bagi tahun kewangan berakhir 31 Disember 2012 adalah seperti berikut: Disclosure The details of the remuneration for the Directors for the financial year ended 31 December 2012 are as follows: Pengarah Bukan Eksekutif / Pengarah Eksekutif / Non Executive Jumlah / Executive Director Directors Total () () () Yuran / Fees Gaji dan lain-lain emolumen / Salaries and other emoluments 3, ,550 Manfaat seumpamanya / Benefits-in-kind Jumlah / Total 3, ,340

51 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 049 Penyata Urus Tadbir Korporat Corporate Governance Statement Ganjaran Pengarah / Jumlah Pengarah / Directors Remuneration Number of Directors Pengarah Eksekutif / Pengarah Bukan Eksekutif / Executive Director Non Executive Directors Dibawah / Below than RM50,000-1 RM50,001 RM100, RM100,001 RM150,000-4 RM150,001 RM200,000-2 Melebihi / More than RM200, Jumlah / Total 1 7 PEMEGANG SAHAM Dialog antara Syarikat dan para Pelabur Malaysia sedar akan kepentingan untuk sentiasa memaklumkan kepada para pemegang saham berkenaan semua perkembangan utama Malaysia dari semasa ke semasa. Pengerusi dan Pengarah Urusan Kumpulan mengadakan perbincangan dengan pemegang saham sekurang-kurangnya sekali (1) setahun semasa Mesyuarat Agung Tahunan. Selain itu, pelbagai pendedahan dan pengumuman dibuat kepada Bursa Malaysia termasuk keputusan suku tahunan, laporan setengah tahunan dan keputusan tahunan bagi memudahkan penyebaran maklumat kepada pemegang saham. Tambahan lagi, semua pengumuman-pengumuman ini dan maklumat-maklumat lain mengenai Syarikat boleh diperolehi di laman web Malaysia, iaitu Syarikat berpandu kepada Keperluan Penyenaraian Bursa Malaysia mengenai Dasar Pendedahan Korporat. Mesyuarat Agung Tahunan Mesyuarat Agung Tahunan adalah forum utama bagi dialog dengan pemegang saham. Selain dari agenda biasa untuk Mesyuarat Agung Tahunan, Lembaga Pengarah akan membentangkan laporan prestasi dan pencapaian perniagaan seperti yang dinyatakan dalam Laporan Tahunan dan memberi peluang kepada pemegang saham untuk mengemukakan soalan mengenai aktiviti perniagaan Kumpulan. Pengarah Urusan Kumpulan juga berkongsi dengan para pemegang saham Syarikat mengenai jawapan kepada soalan-soalan yang dikemukakan terlebih dahulu sebelum AGM oleh Badan Pengawas Pemegang Saham Minoriti Berhad. SHAREHOLDERS Dialogue between the Company and Investors Malaysia recognizes the importance to keep the shareholders well-informed of all major developments of Malaysia on a timely basis. The Chairman and Group Managing Director hold discussions with shareholders at least once (1) a year during the Annual General Meeting. Additionally, various disclosures and announcements made to Bursa Malaysia including quarterly, semi-annual returns and annual results facilitate the dissemination of information to the shareholders. In addition, all these announcements and other information about the Company is available on Malaysia s website, The Company is guided by the Bursa Malaysia Listing Requiremens regarding the Corporate Disclosure Policy. The Annual General Meeting The Annual General Meeting is the principal forum for dialogues with shareholders. Besides the normal agenda for the Annual General Meeting, the Group Managing Director presents the progress and performance of the business as contained in the Annual Report and provides opportunities for shareholders to raise questions pertaining to the business activities of the Group. The Group Managing Director also shared with the shareholders the Company s responses to questions submitted in advance of the AGM by the Minority Shareholder Watchdog Group.

52 050 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Penyata Urus Tadbir Korporat Corporate Governance Statement Notis Mesyuarat Agung Tahunan telah dihantar kepada para pemegang saham lebih awal sedikit daripada keperluan 21 hari di bawah Akta Syarikat, 1965 dan Keperluan Penyenaraian Bursa Malaysia. Bagi pemilihan semula para Pengarah, Lembaga Pengarah akan memastikan maklumat sepenuhnya dimaklumkan menerusi notis mesyuarat berhubung para Pengarah yang akan bersara dan manamana Pengarah yang menawarkan diri untuk berkhidmat sekiranya dilantik semula. Setiap perkara urusan khas yang terkandung dalam notis mesyuarat akan disertakan dengan penyata penerangan bagi resolusi yang dicadangkan untuk memudahkan pemahaman sepenuhnya dan penilaian terhadap isu berkaitan. Pada Mesyuarat Agung Tahunan Syarikat ke-27 yang diadakan pada 3 Mei 2012, tiada resolusi substantif yang telah dikemukakan untuk kelulusan pemegang saham, selain daripada resolusi-resolusi yang berkaitan untuk menerima pakai penyata kewangan yang telah diaudit bagi tahun berakhir 31 Disember 2011, pembayaran dividen akhir, pelantikan semula / pemilihan semula Pengarah Bukan Eksekutif yang bersara, pembayaran yuran Pengarah-pengarah dan ahli-ahli Badan Penasihat Syariah, pelantikan semula juruaudit luar, Mandat Pemegang-pemegang Saham bagi Urusniaga-urusniaga yang Berulang dengan Pihak Berkaitan dan pindaan kepada Tataurusan Pertubuhan Syarikat. Oleh itu, resolusi yang dikemukakan untuk kelulusan pemegang saham pada AGM yang ke-27 telah diundi dengan cara mengangkat tangan. AKAUNTABILITI DAN AUDIT Laporan Kewangan Lembaga Pengarah perlu memastikan yang penyata kewangan tahunan dan pengumuman suku tahunan kepada pemegang saham disediakan selaras dengan piawaian perakaunan yang diluluskan dan membentangkan penilaian yang seimbang dan boleh difahami mengenai kedudukan dan prospek Kumpulan. Jawatankuasa Audit membantu Lembaga Pengarah memastikan ketepatan dan kelengkapan maklumat dengan mengkaji dan mencadangkan mengguna pakai maklumat bagi tujuan pendedahan. Penyata Tanggungjawab Para Pengarah Berkenaan Penyata Kewangan Menurut Akta Syarikat, 1965, Lembaga Pengarah perlu menyediakan penyata kewangan bagi setiap tahun kewangan yang memberi gambaran yang benar dan saksama mengenai keadaan urusan halehwal Syarikat dan Kumpulan sehingga akhir tahun kewangan serta penyata hasil dan aliran tunai Syarikat dan Kumpulan untuk tahun kewangan. The Notice of AGM was dispatched to shareholders slightly earlier than the 21 days requirement under the Companies Act 1965 and Bursa Malaysia Listing Requirements. For re-election of Directors, the Board will ensure that full information is disclosed through the notice of meeting regarding directors who are retiring and who are willing to serve if re-elected. Each item of special business included in the notice of the meeting will be accompanied by an explanatory statement for the proposed resolution to facilitate full understanding and evaluation of issues involved. At the 27th AGM of the Company held on 3 May 2012, no substantive resolutions were put forth for shareholders approval, other than resolutions pertaining to the adoption of audited financial statements for the year ended 31 December 2011, payment of final dividend, re-appointment/re-election of retiring Non-Executive Directors, payment of Directors and Shariah Advisory Body members fees, re-appointment of external auditors, Shareholders Mandate for Recurrent Related Party Transactions and amendments to the Articles of Association. As such, the resolutions put forth for shareholders approval at the 27th AGM were voted on by a show of hands. ACCOUNTABILITY AND AUDIT Financial Reporting The Board ensures that the annual financial statements and quarterly announcements to shareholders are prepared in accordance with approved accounting standards and present a balance and understandable assessment of the Group s position and prospects. The Audit Committee assists the Board in ensuring accuracy and adequacy of information by reviewing and recommending for adoption information for disclosure. Statement of Directors Responsibilities in Relation to Financial Statements The Directors are required under the Companies Act, 1965, to prepare financial statements for each financial year which give a true and fair view of the state of affairs of the Company and the Group as at the end of the financial year and of the income statement and cash flows for the Company and the Group for the financial year.

53 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 051 Penyata Urus Tadbir Korporat Corporate Governance Statement Para Pengarah memberi pertimbangan bahawa, dalam menyediakan penyata kewangan bagi tahun berakhir 31 Disember 2012, Kumpulan telah menggunakan dasar perakaunan yang sesuai, digunakan secara konsisten dan disokong oleh pertimbangan dan anggaran yang wajar dan berhemat. Para Pengarah juga telah mempertimbangkan bahawa kesemua piawaian perakaunan yang berkaitan dipatuhi dan mengesahkan bahawa penyata kewangan disediakan mengikut dasar perniagaan berterusan. Para Pengarah bertanggungjawab memastikan supaya Syarikat menyediakan rekod perakaunan yang secukupnya yang menunjukkan ketepatan yang munasabah mengenai kedudukan kewangan Syarikat bagi membolehkan mereka memastikan agar penyata kewangan tersebut mematuhi keperluan Akta Syarikat, Para Pengarah mempunyai tanggungjawab secara am untuk mengambil langkah yang munasabah dalam memastikan perlindungan aset Syarikat dan Kumpulan terpelihara dan mengelakkan serta mengesan sebarang bentuk penipuan dan kesalahan undang-undang. Kawalan Dalaman dan Pengurusan Risiko Lembaga Pengarah mengiktiraf tanggungjawabnya dan komited untuk mengekalkan pelaksanaan sistem kawalan dalaman dan amalan pengurusan risiko yang berwibawa. Walau bagaimanapun, sistem tersebut hanya dapat memberikan jaminan berpatutan dan bukannya mutlak daripada sebarang salah nyata atau kerugian ketara. Penyata Pengurusan Risiko dan Kawalan Dalaman yang dibentangkan di muka surat 54 hingga 60 dalam Laporan Tahunan ini memberikan tinjauan menyeluruh mengenai pengurusan risiko dan kawalan dalaman Kumpulan. Hubungan dengan Juruaudit Peranan Jawatankuasa Audit dinyatakan di muka surat 31 hingga 39. Melalui Jawatankuasa Audit Lembaga Pengarah, Syarikat telah mewujudkan hubungan yang telus dan sesuai dengan juruaudit Syarikat, sama ada dalaman mahupun luaran. Jika perlu, juruaudit luar akan dijemput untuk menghadiri mesyuarat Jawatankuasa. The Directors consider that, in preparing the financial statements for the year ended 31 December 2012, the Group has used appropriate accounting policies, consistently applied and supported by reasonable and prudent judgements and estimates. The Directors have also considered that all applicable accounting standards have been followed and confirm that the financial statements have been prepared on the going concern basis. The Directors are responsible for ensuring that the Company maintains adequate accounting records which disclose with reasonable accuracy the financial position of the Company to enable them to ensure that the financial statements comply with the requirements of the Companies Act, The Directors generally have the duty to take such steps as are reasonably available to them to safeguard the assets of the Company and the Group, and to prevent and detect fraud and other irregularities. Internal Control and Risk Management The Board acknowledges its responsibility and is committed in maintaining a sound system of internal control and risk management practice. However, such system can only provide reasonable but not absolute assurance against material misstatements or losses. The Statement on Risk Management and Internal Control furnished on pages 54 to 60 in the Annual Report provides an overview of the state of risk management and internal control within the Group. Relationships with the Auditors The role of the Audit Committee is as stated on pages 31 to 39. Through the Audit Committee of the Board, the Company has established transparent and appropriate relationship with the Company s auditors, both internal and external. If required, the external auditors are invited to attend meetings of the Committee. This statement is made in accordance with the resolution of the Board of Directors dated 15 March Penyata ini dibuat selaras dengan resolusi Lembaga Pengarah bertarikh 15 Mac 2013.

54 052 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Maklumat Pematuhan Tambahan Additional Compliance Information 1. PENGGUNAAN DANA Tiada dana yang diterbitkan/digunakan oleh Malaysia daripada cadangan korporat sepanjang tahun kewangan. 2. PEMBELIAN BALIK SAHAM Tiada sebarang pembelian balik saham dilakukan oleh Malaysia sepanjang tahun kewangan. 3. OPSYEN, WARAN ATAU SEKURITI BOLEH TUKAR Tiada sebarang opsyen, waran atau sekuriti boleh tukar yang diterbitkan oleh Malaysia sepanjang tahun kewangan. 4. PROGRAM AMERICAN DEPOSITORY RECEIPT (ADR) ATAU GLOBAL DEPOSITORY RECEIPT (GDR) Malaysia tidak menaja sebarang program ADR atau GDR sepanjang tahun kewangan. 5. PENGENAAN SEKATAN/PENALTI Tiada sekatan dan/atau penalti yang dikenakan ke atas Malaysia dan subsidiari, para Pengarah atau Pengurusannya oleh pihak berkuasa berkaitan sepanjang tahun kewangan. 6. YURAN BUKAN AUDIT Yuran bukan audit yang dibayar kepada juruaudit luar pada tahun kewangan berjumlah RM60, VARIASI KEPUTUSAN Tiada variasi ketara (berbeza sebanyak 10% atau lebih) antara keputusan untuk tahun kewangan dan keputusan tidak diaudit yang diumumkan sebelumnya. Malaysia tidak mengeluarkan sebarang anggaran, ramalan atau unjuran keuntungan bagi tahun kewangan. 8. JAMINAN KEUNTUNGAN Tiada jaminan keuntungan diberi oleh Malaysia sepanjang tahun kewangan. 9. KONTRAK PENTING MELIBATKAN PENGARAH DAN PEMEGANG SAHAM UTAMA Tiada kontrak penting yang dimeterai oleh Malaysia dan syarikat-syarikat subsidiarinya yang membabitkan kepentingan para Pengarah dan Pemegang Saham utama, sama ada yang masih wujud pada akhir tahun kewangan atau yang dimeterai sejak akhir tahun kewangan sebelumnya kecuali untuk urus niaga pihak berkaitan yang dinyatakan dalam Nota 40 kepada penyata kewangan. 1. UTILISATION OF PROCEEDS There were no proceeds raised/utilised by Malaysia from corporate proposals during the financial year. 2. SHARE BUYBACKS There were no share buybacks by Malaysia during the financial year. 3. OPTIONS, WARRANTS OR CONVERTIBLE SECURITIES No options, warrants or convertible securities were issued by Malaysia during the financial year. 4. AMERICAN DEPOSITORY RECEIPT (ADR) OR GLOBAL DEPOSITORY RECEIPT (GDR) PROGRAMME Malaysia did not sponsor any ADR or GDR programme during the financial year. 5. IMPOSITIONS OF SANCTIONS/PENALTIES There were no sanctions and/or penalties imposed on Malaysia and its subsidiaries, Directors or Management by relevant regulatory bodies during the financial year. 6. NON-AUDIT FEES There were RM60,000 non-audit fees paid to external auditors during the financial year. 7. VARIATION IN RESULTS There was no significant variation (differing by 10% or more) between the results for the financial year and the unaudited results previously announced. Malaysia did not release any profit estimate, forecast or projections for the financial year. 8. PROFIT GUARANTEE There was no profit guarantee given by Malaysia during the financial year. 9. MATERIAL CONTRACTS INVOLVING DIRECTORS AND MAJOR SHAREHOLDERS There were no material contracts entered into by Malaysia and its subsidiary companies involving Directors and major Shareholders interest, either still subsisting at the end of the financial year or entered into since the end of the previous financial year except for related parties transactions disclosed in Note 40 to the financial statements.

55 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 053 Maklumat Pematuhan Tambahan Additional Compliance Information 10. URUSNIAGA PIHAK BERKAITAN YANG BERULANG / RECURRENT RELATED PARTY TRANSACTIONS Bentuk Urusniaga Pihak Berkaitan yang Berurusniaga Pihak Berkaitan, kepentingan mereka dan bentuk hubungan dengan Kumpulan Malaysia Nilai Urusniaga Sebenar dari 1 Januari 2012 hingga 31 Disember 2012 () Sewa bangunan pejabat yang dibayar kepada Malaysia oleh Bank Islam Malaysia Berhad (BIMB) BIMB BIMB adalah subsidiari 51% milik BHB. BHB adalah pemegang saham utama Malaysia yang memegang kepentingan ekuiti sebanyak 61.14% dalam Syarikat pada 31 Disember Dato Paduka Ismee Ismail dan Encik Johan Abdullah adalah Pengarah BHB dan BIMB dan juga Pengarah Malaysia, yang dilantik oleh BHB. Dato Paduka Ismee Ismail dan Encik Johan Abdullah tidak mempunyai sebarang kepentingan langsung atau tidak langsung dalam BHB, BIMB dan Malaysia. 2,640 Puan Rozaida Omar adalah Pengarah BHB dan juga Pengarah Malaysia, yang dilantik oleh BHB. Dato Mohamed Hassan Md. Kamil adalah Pengarah Malaysia, yang dilantik oleh BHB. Puan Rozaida Omar dan Dato Mohamed Hassan Md. Kamil tidak mempunyai sebarang kepentingan langsung atau tidak langsung dalam BHB dan Malaysia. Nature of Transactions Related Parties Transacted with Related Parties, their interests and nature of relationships with the Malaysia Group Actual Transaction Value from 1 January 2012 to 31 December 2012 () Rental of office premises payable to Malaysia by Bank Islam Malaysia Berhad (BIMB) BIMB BIMB is a 51% owned subsidiary of BHB. BHB is a major shareholder of Malaysia holding an equity interest of 61.14% in the Company as at 31 December Dato Paduka Ismee Ismail and Encik Johan Abdullah are Directors in BHB and BIMB and are also Directors in Malaysia, nominated by BHB. Dato Paduka Ismee Ismail and Encik Johan Abdullah do not have any direct or indirect interest in BHB, BIMB and Malaysia. 2,640 Puan Rozaida Omar is a director in BHB and is also a director in Malaysia, nominated by BHB. Dato Mohamed Hassan Md. Kamil is a director in Malaysia, nominated by BHB. Puan Rozaida Omar and Dato Mohamed Hassan Md. Kamil do not have any direct or indirect interest in BHB and Malaysia.

56 054 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Penyata Pengurusan Risiko dan Kawalan Dalam Statement on Risk Management and Internal Control Penyata Pengurusan Risiko dan Kawalan Dalaman Penyata ini disediakan menurut Keperluan Penyenaraian Pasaran Utama Bursa Malaysia Securities Berhad berkaitan dengan Pematuhan Kumpulan terhadap Prinsip dan peruntukan-peruntukan Cadangan yang berkaitan dengan kawalan dalaman seperti yang digariskan di dalam Kod Urus Tadbir Korporat Malaysia ( Kod ). Tanggungjawab Lembaga Pengarah Lembaga Pengarah mengiktiraf bahawa mereka bertanggungjawab sepenuhnya terhadap persekitaran kawalan dalaman dan keberkesannya dalam menjaga kepentingan-kepentingan pemegang-pemegang saham dan aset-aset Kumpulan. Sistem kawalan dalaman turut memenuhi keperluan untuk operasi-operasi perniagaan yang berkesan dan cekap, laporan kewangan yang baik dan prosedur-prosedur kawalan, serta pematuhan terhadap undang-undang dan peraturan-peraturan yang berkaitan. Lembaga Pengarah turut mengakui bahawa penyemakan terhadap system kawalan dalaman Kumpulan adalah usaha yang jitu dan berterusan, yang dirangka untuk mengurus dan mengurangkan risiko kegagalan untuk mencapai objektif-objektif perniagaan. Sewajarnya, sistem kawalan dalaman Kumpulan turut memberikan jaminan yang munasabah ke atas salah nyata atau kerugian yang ketara. Pihak Pengurusan telah memberi jaminan kepada Lembaga Pengarah berkaitan kecukupan dan keberkesanan pengurusan risiko dan sistem kawalan dalaman Kumpulan. Proses-Proses Kawalan Dalaman Utama Proses-proses kawalan dalaman utama yang telah ditubuhkan oleh Lembaga Pengarah dalam menyemak kecukupan serta integriti sistem kawalan dalaman termasuk pematuhan kepada undangundang, peraturan-peraturan, syarat-syarat, arahan-arahan dan garis panduan-garis panduan adalah seperti berikut : Rangka Kerja Pengurusan Risiko Lembaga Pengarah mengakui bahawa mengenal pasti dan mengurus risiko utama memainkan peranan penting dan merupakan asas dalam mencapai objektif-objektif perniagaan Kumpulan serta dalam menguruskan operasi hariannya. Statement on Risk Management and Internal Control This statement is made pursuant to the Main Market Listing Requirements of Bursa Malaysia Securities Berhad with regard to the Group s compliance with the Principles and Recommendations provisions relating to internal controls as stipulated in the Malaysian Code on Corporate Governance ( the Code ). Board Responsibility The Board acknowledges its overall responsibility for the internal control environment and its effectiveness in safeguarding shareholders interests and Group s assets. The system of internal control addresses the need for an effective and efficient business operations, sound financial reporting and control procedures, and compliance with relevant laws and regulations. The Board also recognises that reviewing the Group s system of internal control is a concerted and continuing process, designed to manage and appropriately mitigate the risk of failure in achieving business objectives. Accordingly, the Group s system of internal control provides reasonable assurance against material misstatement or loss. The Management has given the assurance to the Board on the adequacy and effectiveness of the Group s risk management and internal control system. Key Internal Control Processes The key internal control processes that the Board has established in reviewing the adequacy and integrity of the system of internal control, including compliance with applicable laws, regulations, rules, directives and guidelines, are as follows: Risk Management Framework The Board acknowledges the identification and the management of risks involved play an important and integral part in achieving the Group s business objectives and the management of its daily operations.

57 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 055 Penyata Pengurusan Risiko dan Kawalan Dalam Statement on Risk Management and Internal Control Bagi mencapai objektif-objektif tersebut, Lembaga Pengarah telah menyediakan Rangka Kerja Pengurusan Risiko Seluruh Perniagaan ( ERM ) dalam Kumpulan bagi memastikan supaya wujud proses yang berterusan bagi mengenalpasti, menilai, memantau dan mengurus pendedahan risiko utama yang sememangnya lazim dalam operasi perniagaannya. Kumpulan telah menubuhkan proses pengurusan risiko berstruktur yang mana peranan serta tanggungjawab Lembaga Pengarah Jawatankuasa Risiko ( BRC ) adalah menyediakan pemantauan yang berkesan terhadap keseluruhan risiko syarikat melalui mesyuarat suku tahunan Lembaga Pengarah Jawatankuasa Risiko. Penglibatan Pengurusan Kanan dipastikan melalui mesyuarat suku tahunan Pengurusan Jawatankuasa Risiko. Penilaian Risiko Korporat untuk syarikat secara keseluruhannya yang terdiri dari risiko kewangan, perniagaan dan operasi telah meningkat sepanjang tahun Untuk memastikan kawalan risiko teguh dan stabil, syarikat telah mengambil langkah untuk menilai Rangka Kerja Pengurusan Risiko di mana penambahbaikan telah dibuat untuk meninggikan taraf amalan pengurusan risiko ke tahap kematangan yang lebih tinggi dan menyerap ke dalam aspek-aspek organisasi yang lebih luas untuk kawalan yang lebih ketat. Dalam usaha mengurangkan risiko terhadap bencana dan malapetaka, Syarikat telah menubuhkan Rangka Kerja Pengurusan Kesinambungan Perniagaan. Pelan Kesinambungan Perniagaan telah dibangunkan dan telah diuji untuk keberkesanan fungsi; dan Pelan Pemulihan Bencana IT (ITDR) telah juga diuji sebanyak dua kali dalam setahun ke atas kerangka utama sistem teknologi maklumat. Sepanjang tahun kewangan, satu skala penuh latihan simulasi krisis kesinambungan perniagaan telah dijalankan yang melibatkan mobilisasi operasi dari Menara Malaysia (Ibu Pejabat) dan beberapa cawangan terpilih kepada tapak pemulihan yang telah ditetapkan. In pursuing these objectives, the Board has put in place an Enterprise Wide Risk Management ( ERM ) framework within the Group to ensure there is an on-going process of identifying, evaluating, monitoring and managing the significant risk exposures surrounding its business operations. The Group has established a structured risk management process whereby the roles and responsibility of Board Risk Committee (BRC) is to provide effective oversight on company-wide risks through quarterly Board Risk Committee meetings. Senior Management involvement are assured through quarterly Management Risk Committee meetings. The overall net Corporate Risk Rating of the Company which comprises financial, business and operational risks has improved throughout year To ensure the risk controls are robust and maintained, the company has undertaken an exercise of reviewing the Risk Management framework where enhancements were made to escalate risk management practices to a higher maturity level and permeate into wider aspects of the organisation for tighter control. As a risk mitigation towards disasters and major disruptions; the Company had established a Business Continuity Management Framework. Business Continuity Plans are developed and tested for functionality and IT Disaster Recovery (ITDR) plans are tested twice a year on the production main server. During the financial year, one full scale crisis simulation exercises on business continuity was carried out that involved the mobilisation of operation from Menara Malaysia (Head Office) and selected branches to the respective designated recovery sites. Modified Solvency Margin Ratio (MSMR) and Stress Testing have been carried out on a quarterly basis in line with the requirements under Risk & Capital Management Framework and Asset Liability Management Framework. Pengubahsuaian Nisbah Margin Kesolvenan (MSMR) dan Ujian Tekanan telah dijalankan pada setiap suku tahun sejajar dengan kehendak di bawah Rangka Kerja Pengurusan Risiko dan Modal dan juga Rangka Kerja Pengurusan Aset dan Liabiliti.

58 056 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Penyata Pengrusan Risiko dan Kawalan Dalam Statement on Risk Management and Internal Control Fungsi Audit Dalaman Bahagian Audit Dalaman ( IAD ) membantu Lembaga Pengarah dan Jawatankuasa Audit dalam menjalankan tanggungjawab mereka. Audit Dalaman berfungsi untuk memberikan jaminan ke atas keberkesanan dan kelancaran sistem kawalan dalaman yang dilaksana oleh pihak pengurusan. Pelan Audit Tahunan dibangunkan dari penilaian terhadap kepentingan risiko, pendedahan, dan strategi Kumpulan. IAD juga menyiasat kejadian penipuan, pemalsuan serta memberikan cadangan-cadangan kepada Jawatankuasa Audit untuk menghalang pengulangan semula. Perlaksanaan pelan tindakan pengurusan yang dirangka untuk menghalang kelemahan kawalan yang telah diperakui sepanjang tempoh kewangan yang dipantau melalui kajian susulan. Jawatankuasa juga mengkaji dan meluluskan Pelan Audit Tahunan, laporan-laporan serta penemuan termasuk susulan oleh Audit Dalaman. Mereka juga mengkaji tindakan yang diambil ke atas penemuan kawalan dalaman yang dikenalpasti di dalam laporan-laporan yang disediakan oleh juruaudit luar dan badan-badan penguatkuasaan semasa mesyuarat-mesyuarat mereka serta menilai kesan ke atas keberkesanan dan kecukupan sistem kawalan dalaman Kumpulan. Elemen Penting Kawalan Dalaman Elemen-elemen utama kawalan dalaman yang diwujudkan oleh Lembaga Pengarah bagi menyediakan kawalan dalaman yang berkesan termasuk pematuhan terhadap undang-undang, peraturanperaturan dan garis panduan-garis panduan adalah seperti berikut: Struktur Organisasi Kumpulan telah membentuk sebuah struktur organisasi yang tersusun dengan had-had tanggungjawab dan akauntabiliti yang jelas serta pengagihan kuasa yang bertakrif kepada Jawatankuasajawatankuasa Lembaga Pengarah dan Pengurusan. Had Kuasa Had kuasa yang ditakrif telah disemak dan diluluskan oleh Lembaga Pengarah pada 20 November 2012 dan telah dilaksanakan dalam bidang Pengunderaitan, Kelulusan Tuntutan, Pelaburan dan proses perniagaan yang lain. Internal Audit Function The Internal Audit Division ( IAD ) assists the Board and Audit Committee in the discharge of their responsibilities. The internal audit function provides assurance on the efficiency and effectiveness of the internal control systems implemented by management. An annual audit plan is developed based on an assessment of risk priorities, exposures, and business strategies of the Group. IAD also investigates incidents of fraud, malpractices and makes necessary recommendation to the Audit Committee to impede recurrence. The implementation of management action plans to address the control lapses noted during the financial period are monitored through follow-up reviews. The Committee reviews and approves the Annual Audit Plan, reports and findings including the follow-ups of the Internal Auditors. They also review the actions taken on internal control issues identified in reports prepared by External Auditors and Regulatory Bodies during their meetings and consider the impact on the effectiveness and adequacy of the Group s internal control system. Key Elements of Internal Control The key elements of internal control that the Board has established which provide effective internal controls including compliance with applicable laws, regulations and guidelines are as follows: Organisational Structure The Group has established a defined organisational structure with lines of responsibility and accountability with a defined delegation of authority of Committees of the Board and Management. Limit of Authorities A defined limit of authorities has been revised and approved by the Board on 20th November 2012 and implemented in the areas of Underwriting, Claims approval, Investments and other business process.

59 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 057 Penyata Pengurusan Risiko dan Kawalan Dalam Statement on Risk Management and Internal Control Prosedur Operasi Piawai Prosedur Operasi Piawai yang mengawal proses-proses perniagaan utama seperti kewangan, sumber manusia, tuntutan, pelaburan dan lain-lain telah diadakan di dalam organisasi. Rangka Kerja Pembangunan Produk Pada bulan Mac 2012, STMB telah mendapat kelulusan daripada BNM untuk mengamalkan sistem pelancaran dan fail untuk produk-produk baru. Memandangkan sistem pelancaran dan fail telah diberikan kepada STMB, kami telah mengkaji semula polisi dan prosedur yang merangkumi Rangka Kerja Pembangunan Produk, sambil mengambilkira jangkaan penyeliaan daripada BNM di bawah Pengenalan Garis Panduan Produk Baru. Fungsi Pematuhan Syarikat mempunyai Piagam dan Rangka Kerja Pematuhan yang telah ditubuhkan yang menggariskan pematuhan tadbir urus dan metodologi. Semua kehendak pematuhan, matrik, prosedur operasi piawai dan garis panduan telah di muatkan dalam Portal Korporat Bahagian Pematuhan. Polisi Pemberitahuan Maklumat dan Polisi Penipuan & Integriti Lembaga Pengarah juga telah meluluskan Polisi Pemberitahuan Maklumat sebagai respons kepada Akta Perlindungan Pemberi Maklumat, 2010 serta Polisi Penipuan & Integriti pada Ogos 2011 yang penting dalam menggalakkan kelakuan beretika dalam Kumpulan. Rangka Kerja Tadbir Urus Syariah Rangka Kerja Tadbir Urus Syariah telah diluluskan oleh Badan Penasihat Syariah (BPS) pada 27 Julai Rangka kerja ini bertujuan untuk memenuhi objektif berikut: Standard Operating Procedures The Standard Operating Procedures that govern the key business processes such as finance, actuarial, human resources, claims, investments and etc, are in place within the organisation. Product Development Framework In March 2012, STMB was granted the approval by BNM to adopt launch-and-file system for new products. In view of the launch-and-file system granted to STMB, we have reviewed the policies and procedures within the Product Development Framework, taking into consideration BNM s supervisory expectations under the Introduction of New Product Guidelines. Compliance Function The Company has established Compliance Charter and Framework setting out the compliance governance and methodology. All compliances requirements, matrixes, SOPs and guidelines are posted in the Corporate Portal Compliance Division. Whistle Blowing Policy and Fraud and Integrity Policy The Board has also approved the Whistle Blowing Policy in response to the Whistleblower Protection Act, 2010 as well as Fraud and Integrity Policy in August 2011 which is essential in promoting ethical conduct within the Group. Shariah Governance Framework The Shariah Governance framework was approved by the Shariah Advisory Body (SAB) on 27 July The framework is designed to meet the following objectives: i. To set out Malaysia s Shariah governance structures, processes and arrangements to ensure that all its operations and business activities are in accordance with Shariah. i. Untuk menetapkan struktur tadbir urus pentadbiran Syariah bagi Malaysia, proses-proses dan aturan untuk memastikan bahawa semua operasi dan aktiviti perniagaan adalah selaras dengan Syariah. ii. To provide a comprehensive guidance to the Board, SAB and Management in discharging its duties in matters relating to Shariah. ii. Untuk menyediakan satu panduan yang komprehensif kepada Lembaga, BPS dan Pengurusan dalam menjalankan tugasnya dalam perkara-perkara yang berkaitan dengan Syariah.

60 058 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Penyata Pengurusan Risiko dan Kawalan Dalam Statement on Risk Management and Internal Control iii. Untuk menggariskan fungsi yang berkaitan dengan kajian, audit, penyelidikan dalaman dan proses-proses pengurusan risiko berkaitan Syariah. iii. To outline the functions relating to Shariah review, Shariah audit, internal Shariah research and Shariah risk management processes. iv. Untuk mewujudkan prinsip Syariah yang mantap dan melahirkan persefahaman di kalangan pihak berkepentingan di Malaysia, termasuk tetapi tidak terhad kepada pekerja-pekerja dan pelanggan-pelanggan Malaysia. Rangka Kerja Pengurusan Aset dan Liabiliti Rangka kerja ini telah diluluskan oleh Lembaga Pengarah pada bulan November 2011 untuk menyediakan struktur asas Pengurusan Aset dan Liabiliti dan seterusnya mempertingkatkan lagi mekanisma kawalan yang sedia ada yang mendasari aktiviti perniagaan. Rangka Kerja Operasi Syarikat telah mewujudkan satu rangka kerja untuk mentadbir dan mendokumentasi model operasi yang diguna-pakai, polisi pengasingan dana-dana takaful, polisi mengenai strategi pelaburan dan kaedah yang digunakan untuk pengiraan keuntungan pelaburan bagi dana pelaburan peserta, polisi pengiktirafan lebihan/defisit dan peruntukan/pengedaran,polisi mengenai mekanisma pembetulan defisit termasuk pembayaran balik qardh, pengurusan pendapatan daripada perniagaan takaful dan perbelanjaan dan caj-caj ke atas dana takaful yang dibenarkan. Pengurusan Lebihan dan Dasar Pengagihan Dalam menguruskan dana-dana takaful, pengendali-pengendali takaful dijangka akan menguruskan kepentingan pelbagai pihak berkepentingan tanpa menjejaskan sikap berhemah. Polisi ini berfungsi sebagai panduan kepada Syarikat dalam menguruskan kedudukan lebihan dan pembahagian lebihan kepada peserta dan pemegang saham dengan menyediakan prinsip, pertimbangan dan amalan yang utama untuk memastikan penyelenggaraan kesolvenan dana yang baik dan daya tahan kewangan dan untuk melindungi kepentingan peserta dan memberikan layanan yang saksama kepada semua peserta-peserta. iv. To establish robust Shariah principle and understanding among stakeholder of Malaysia, include but not limited to employees and customers of Malaysia. Assets Liabilities Management Framework The framework was approved by the Board in November 2011 to provide the basic structure of the Assets and Liabilities Management and to further enhance the existing control mechanism underlying the business activities. Operational Framework The Company has established a framework to govern and document the operational models adopted, fund segregation policy of takaful funds, policy on investment strategy and method used for the calculation of investment profit for participant investment fund, policy on recognition of surplus/deficit and its allocation/distribution, policy on deficit rectification mechanism including repayment of qardh, management of income from takaful business, and allowable expenses charges to takaful funds. Surplus Management and Distribution Policy In managing the takaful funds, takaful operators are expected to manage the interest of various stakeholders without compromising prudence. This policy serves as a guide to the Company in managing the surplus position and surplus distribution to participants and shareholders by providing key principles, considerations and practices to ensure good maintenance of fund solvency and financial resilience, and to safeguard the interests of participants and equitable treatment of participants. The annual distribution of surplus shall be endorsed by the Shariah Advisory Body and Board of Directors. Pengagihan lebihan tahunan hendaklah disahkan oleh Badan Penasihat Syariah dan Lembaga Pengarah.

61 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 059 Penyata Pengurusan Risiko dan Kawalan Dalam Statement on Risk Management and Internal Control Pelan Perniagaan/Pemasaran dan Proses Belanjawan Pelan perniagaan/pemasaran serta belanjawan tahunan Kumpulan dibentangkan kepada Lembaga Pengarah untuk kelulusan. Laporan Kewangan Laporan akaun/pengurusan dibentangkan kepada Lembaga Pengarah untuk dikaji dan dibincangkan. Penyebaran laporan suku tahunan kepada orang awam dilakukan selepas ia dikaji oleh Jawatankuasa Audit dan diluluskan oleh Lembaga Pengarah. Usaha berterusan turut dijalankan untuk menangani isu-isu kawalan kewangan atau risiko-risiko termasuk pengukuhan terhadap proses penutupan kewangan dan pelarasan. Sistem Teknologi Maklumat Jawatankuasa Peneraju IT Jawatankuasa Peneraju IT telah ditubuhkan untuk mengawasi pembangunan IT yang meyediakan pihak pengurusan pengawalan ke atas fungsi IT di dalam Syarikat. Jawatankuasa Peneraju IT dipengerusikan oleh Pengarah Urusan Kumpulan. Jawatankuasa ini bertanggungjawab untuk meluluskan perbelanjaan berkaitan IT yang besar mengikut had yang telah ditetapkan dan memantau projek yang telah diluluskan, merumuskan polisi dan pelan strategik IT. Rangka Kerja Pengurusan Data Seperti yang ditentukan oleh Garis Panduan BNM, Rangka Kerja Pengurusan Data telah ditubuhkan pada November Rangka Kerja ini merangkumi proses-proses serta kawalan-kawalan yang berkaitan dengan sekuriti dan integriti data. Jawatankuasa Peneraju Projek IT Jawatankuasa Peneraju Projek IT dipengerusikan oleh Pengarah Urusan Kumpulan. Jawatankuasa yang terdiri dari wakil-wakil daripada IT dan pengguna perniagaan, mengawasi prestasi dan pembangunan projek IT yang berkaitan dengan perniagaan sepanjang tempoh kewangan. Business/Marketing Plan and Budget Process The Group s annual business/marketing plan and budget are submitted to the Board for approval. Financial Reporting Management accounts/reports are tabled to the Board for review and discussion. The public release of quarterly reports is made after reviewed by the Audit Committee and approved by the Board. On-going efforts are in place to address financial control issues or risks, which include strengthening the financial closing and reconciliation process. Information Technology System IT Steering Committee An IT Steering Committee has been established to oversee the development of Information Technology (IT) that provides management an oversight of the IT function within the Company. IT Steering committee is chaired by the Group Managing Director. The committee is responsible for authorising major IT expenditures within the approved limits, monitoring approved IT projects, formulating IT policies and IT strategic plans. Data Governance Framework As prescribed by BNM guidelines, the data governance framework was established in November The framework covers processes and related controls over data security and integrity. IT Project Steering Committee IT Project Steering Committee is chaired by the Group Managing Director. The Committee consists of representatives from IT and business users, oversees the progress and development of business related IT project during the financial period.

62 060 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Penyata Pengurusan Risiko dan Kawalan Dalam Statement on Risk Management and Internal Control Kesimpulan Walaupun terdapat kelemahan kawalan yang dikenal pasti dalam proses-proses perniagaan tertentu dalam Kumpulan, namun tiada sebarang kegagalan kawalan atau kelemahan ketara yang menyebabkan kerugian besar yang memerlukan pendedahan dalam laporan tahunan Kumpulan bagi tempoh kewangan yang dikaji. Penyata ini disediakan selaras dengan resolusi Lembaga Pengarah bertarikh 15 Mac Kajian Penyata oleh Juruaudit Luar Menurut kehendak perenggan Syarat-syarat Penyenaraian Pasaran Utama Bursa Malaysia Securities Berhad, juruaudit luar telah menyemak Penyata Kawalan Dalaman ini. Semakan ini telah dilakukan selaras dengan Recommended Practice Guide ( RPG ) 5 yang telah dikeluarkan oleh Institut Akuantan Malaysia. Berdasarkan semakan mereka, juruaudit luar telah melaporkan kepada Lembaga Pengarah bahawa tiada sebarang perkara yang sampai ke perhatian mereka yang boleh menyebabkan mereka menganggap bahawa penyata ini tidak konsisten dengan kefahaman mereka mengenai proses yang diguna-pakai oleh Lembaga Pengarah dalam mengkaji semula kecukupan dan integriti kawalan dalaman Kumpulan. RPG 5 tidak memerlukan pertimbangan juruaudit luar serta mereka juga tidak perlu menilai samada Penyata ini merangkumi segala risikorisiko dan kawalan-kawalan, atau memberikan pendapat tentang keberkesanan prosedur-prosedur risiko dan kawalan Kumpulan. Conclusion Although control lapses were identified for certain business processes within the Group, there were no significant control failures or weaknesses that has resulted in material loss that requires disclosure in the Group s annual report for the financial period under review. This statement is made in accordance with the Board of Directors resolution dated 15 March Review of the Statement by External Auditors As required by para of Bursa Malaysia Securities Berhad Main Market Listing Requirements, the External Auditors have reviewed this Internal Control Statement. The review was performed in accordance with Recommended Practice Guide ( RPG ) 5 issued by the Malaysian Institute of Accountants. Based on their review, the External Auditors have reported to the Board that nothing has come to their attention that causes them to believe that this Statement is inconsistent with their understanding of the process the Board has adopted in the review of the adequacy and integrity of internal control of the Group. RPG 5 does not require the External Auditors to and they did not consider whether this Statement covers all risks and controls, or to form an opinion on the effectiveness of the Group s risk and control procedures.

63 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 061 Penyata Pengerusi Chairman s Statement Y. Bhg. Dato Paduka Ismee Ismail Dengan Nama Allah, yang Maha Pengasih, lagi Maha Penyayang. Assalamualaikum Warahmatullahi Wabarakatuh. Saya dengan sukacitanya membentangkan Laporan Tahunan dan Penyata Kewangan yang telah diaudit bagi tahun kewangan yang berakhir pada 31 Disember In the Name of Allah, the Most Compassionate, the Most Merciful. Assalamualaikum Warahmatullahi Wabarakatuh. I hereby present the Annual Report and Audited Financial Statements for the financial year ended 31 December 2012.

64 062 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Penyata Pengerusi Chairman s Statement Para Pemegang Saham yang dihormati, Ekonomi dunia pulih sedikit pada tahun 2012 selepas mengalami gelora pada tahun sebelumnya, dipacu oleh kelonggaran kredit oleh negara anggota Kesatuan Eropah dan pasaran buruh AS yang bertambah baik. Walau bagaimanapun, pertumbuhan kekal lemah justeru halangan oleh krisis Eurozone yang berterusan selain dasar monetari lebih ketat yang diamalkan oleh India dan China pada tahun Mengambil kira semua faktor yang relevan, Tabung Monetari Antarabangsa meramalkan hasil ekonomi global akan berkembang sedikit pada kadar 3.3%. Meskipun begitu, Malaysia berjaya mencatat pertumbuhan yang lebih baik daripada jangkaan apabila ekonomi berkembang sebanyak 5.6% pada tahun 2012 disokong oleh pengukuhan permintaan dalam negeri yang berterusan dan peningkatan perbelanjaan infrastruktur oleh kerajaan. Pertumbuhan sektor kewangan Islam adalah lebih baik. Laporan Dunia Ernst & Young 2012 menyatakan bahawa industri terus menunjukkan pertumbuhan dua angka pada tahun 2012 meskipun pada kadar yang lebih perlahan secara relatif berbanding dengan tahun sebelumnya. Indonesia, Brunei dan Malaysia mencakupi US$2 bilion dalam sumbangan kasar, sementara Malaysia sahaja mencapai kadar pertumbuhan melebihi 20%. Dengan latar belakang ini, saya berbesar hati melaporkan bahawa Malaysia telah mencatat prestasi perolehan kasar dan perolehan bersih yang tertinggi disokong oleh pertumbuhan mantap dalam Bankatakaful dan perniagaan kumpulan selain prestasi cemerlang yang berterusan bagi aktiviti pelaburan. Dengan prestasi gemilang pada tahun 2012, Malaysia telah mencatat rekod pertumbuhan perniagaan lima tahun berturut-turut sejak program Transformasi kami bermula pada tahun Sehingga kini, jumlah aset Kumpulan mencecah RM6.4 bilion dengan pertumbuhan tahunan melebihi 9% dan pertumbuhan keuntungan Kumpulan tahun demi tahun melebihi 30%. Dear Shareholders, The world economy recovered slightly in 2012 after the turbulence of the previous year, driven by credit easing by European Union member countries and an improving US labour market. However, growth remained weak, hampered by the continuing Eurozone crisis as well as tighter monetary policies adopted by India and China during the year. Taking all relevant factors into consideration, the International Monetary Fund predicted the global economic output to expand by a marginal 3.3%. Nonetheless, Malaysia managed to record better than expected growth with the economy expanding by 5.6% in 2012 supported by continued strength in domestic demand and increased government spending on infrastructure. The Islamic finance sector fared much better. The Ernst & Young World Report 2012 noted that the industry continued to show double-digit growth in 2012 albeit at a relatively slower rate than in previous years. Indonesia, Brunei and Malaysia accounted for US$2 billion in gross contributions, with Malaysia on its own achieving a growth rate of over 20%. Against this backdrop, I am happy to report that Malaysia has registered another year of record-breaking top-line and bottom-line performance underpinned by robust growth in the Bancatakaful and group businesses as well as continued outstanding performance of the investment activities. With our sterling performance in 2012, Malaysia has set a five-year track record for consecutive business growth since the start of our Transformation programme in To date, total Group assets stand at RM6.4 billion with annual growth exceeding 9% and year-on-year Group profit growth exceeding 30%. Malaysia also established itself as the leader in the group family business, capturing 40% of this market sector, and 21% of the combined Family and General business, as at 3rd quarter Malaysia turut memperkukuhkan syarikat sebagai peneraju dalam perniagaan keluarga kelompok apabila meraih 40% daripada sektor pasaran ini dan 21% daripada gabungan perniagaan Keluarga dan Am, sehingga suku ke-3 tahun 2012.

65 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 063 Penyata Pengerusi Chairman s Statement Peningkatan prestasi kewangan dan kendalian Kumpulan disebabkan oleh: peningkatan aktiviti pengunderaitan dan pelaburan, penerimaan jenama Malaysia yang semakin meluas, kebolehaksesan pasaran yang lebih baik melalui keupayaan pengagihan yang dipertingkatkan dan perkembangan perkongsian strategik dengan bank-bank Islam. Ini telah ditambah baik oleh inisiatif baharu seperti program hubungan pelabur, kempen kesedaran dan penambahbaikan portal untuk agensi, ejen korporat dan bankatakaful. Kejayaan kumpulan juga didukung oleh sokongan padu daripada pelanggan korporat dan kumpulan kami, rakan kongsi bank dan pelanggan. TAHUN DI DALAM TINJAUAN SOROTAN & PENCAPAIAN Membina Jenama Kami terus agresif di dalam menjalankan kempen penjenamaan dan pemasaran dan pada suku ke-2 tahun 2012, kami telah melancarkan peringkat kedua kempen We Should Talk yang sangat berjaya. Usaha ini sekali lagi memanfaatkan penawaran Rebat Tanpa Tuntutan 15% yang unik bagi semua produk am Malaysia. Pada masa ini, Malaysia merupakan satu-satunya pengendali yang menawarkan manfaat sedemikian. Kami telah memperuntukkan bayaran balik secara konsisten bagi sumbangan yang dibayar jika tiada tuntutan dibuat semasa tempoh perlindungan. Kempen ini memberikan mesej bahawa atau insurans Islam secara amnya adalah sesuai untuk semua orang, orang Islam mahupun bukan Islam dan haruslah dianggap sebagai pilihan pertama atau utama untuk perlindungan, bukan semata-mata sebagai alternatif kepada insurans konvensional. Ia telah berjaya diterima dengan baik dan menghasilkan pertumbuhan positif dalam bilangan pelanggan kami. The Group s improved financial and operational performance can be attributed to: increased underwriting and investment activity, growing acceptance of the Malaysia brand, better market accessibility via enhanced distribution capabilities, and the development of strategic partnerships with Islamic banks. These have been complemented by new initiatives such as our investor relations programme, the awareness campaign and enhanced portals for the agency, corporate agents and bancatakaful. The Group s success was also underpinned by strong support from our group and corporate clients, bank partners and customers. THE YEAR IN REVIEW HIGHLIGHTS & ACHIEVEMENTS Building the Brand We continued to carry out aggressive branding and marketing campaigns, and in the second quarter of 2012 launched the second wave of the highly successful We Should Talk campaign. This once again leveraged on our unique 15% No Claim Rebate offered on all Malaysia general products. At present, Malaysia is the only operator to offer such a benefit. We have been consistently providing refunds on contributions paid if no claims were incurred during the coverage period. The campaign conveyed the message that or Islamic insurance in general is suitable for all, Muslims and non-muslims alike, and should be viewed as a first or primary choice for protection, not merely as an alternative to conventional insurance. It was well received, and led to positive growth in our customer base.

66 064 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Penyata Pengerusi Chairman s Statement Malaysia juga telah memulakan beberapa taklimat strategik dengan pengurus dana, penganalisis dan badan penyelidikan yang menghasilkan peningkatan minat dan keyakinan dalam kalangan komuniti pelabur selain liputan dan penilaian yang lebih baik bagi Syarikat. Pengunderaitan & Pelaburan Malaysia terus mencatat prestasi kukuh dalam aktiviti pengunderaitan yang meraih keuntungan terbanyak. Keluarga menyumbang kira-kira 60% daripada jumlah tersebut, sebahagian besarnya daripada pengembangan dalam perniagaan Keluarga kumpulan. Pada tahun kewangan 2012, Kumpulan terus mengambil sikap berhati-hati dengan menerima hanya kontrak pengunderaitan yang menguntungkan dan mengelak daripada kontrak yang cenderung kepada risiko yang lebih besar. Hasilnya, Kumpulan berupaya meraih keuntungan pengunderaitan yang lebih besar dan mengurangkan nisbah kerugian bagi kedua-dua perniagaan Keluarga dan Am. Meskipun perkitaran pelaburan semakin kompleks dan tidak menentu, pelaburan mencatat perolehan tertinggi di peringkat Kumpulan sebanyak RM363.3 juta sejak program Transformasi dilancarkan pada tahun 2007 disokong oleh keberkesanan peruntukan aset strategik yang dipencong ke arah pulangan jangka panjang selain meminimumkan turun naik portfolio terurus. Usaha ini dilakukan dengan cara yang dinamik namun berhemat dengan mematuhi garis panduan dan dasar kita. Dengan memanfaatkan strategi pengurusan aktif, portfolio ekuiti dan Sukuk terus mengukuhkan aktiviti pelaburan dan memperolehi kadar hasil pelaburan yang memberangsangkan secara mampan dari tahun ke tahun sejak Dari segi ekuiti, syarikat telah berdagang secara aktif dalam pasaran dengan mengamalkan strategi penjualan pada kedudukan kukuh pada mana-mana pasaran yang meningkat untuk meraih keuntungan bagi portfolio kami dan membeli balik apabila pasaran mengalami kelemahan atau membuat pembetulan untuk memenuhi kadar hasil portfolio yang kami sasarkan. Malaysia also embarked on a series of strategic briefings with fund managers, analysts and research houses, resulting in greater interest and confidence among the investor community and better coverage as well as valuation of the Company. Underwriting & Investment Malaysia continued to register strong performance in underwriting activities, which achieved record profits. Family contributed to about 60% of the total, largely from expansion in the group Family business. During the financial year, the Group continued to be cautious in accepting only profitable underwriting contracts while avoiding those prone to greater risks. As a result, the Group was able to derive healthier underwriting profits and reduce the loss ratio of both Family and General businesses. Despite volatile and increasingly complex investment environment during the year, investment registered a record breaking income at the Group level of RM363.3 million since the start of the Transformation programme in 2007, supported by effectiveness of our strategic asset allocation which is skewed towards achieving the long term return while minimising the volatility of the managed portfolios. This is done in a dynamic yet prudent manner, in strict adherence to our guidelines and policies. By capitalising the active management strategy, equities and Sukuk portfolios continued to anchor the investment activities sustainably delivering exceptional investment yields from year to year since On equity side, the Company had been actively trading in the market adopting a strategy of selling into strength on any market run-up to lock in profits for our portfolios and buying back on any market weakness or correction in order to meet our targeted portfolio yield. The Company picked counters that had commendable track records, capable management teams, quality growth with strong earnings visibility and solid balance sheets as well as healthy, free cash flow to sustain high dividend yield and high liquidity. As a result, equity generated double digit ROI of 11.98%. Syarikat memilih kaunter yang mempunyai rekod yang baik, pasukan pengurusan yang cekap, pertumbuhan berkualiti dengan perolehan kukuh dan kunci kira-kira yang mantap selain aliran tunai bebas yang memberangsangkan untuk mengekalkan kadar hasil dividen dan pengaliran tunai yang tinggi. Hasilnya, ekuiti telah menjana ROI dua angka sebanyak 11.98%.

67 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 065 Penyata Pengerusi Chairman s Statement Portfolio Sukuk syarikat pula mencatat pulangan hebat sebanyak 7.15% meskipun kadar faedah rendah pada masa ini. Disokong oleh terbitan baharu yang lebih besar pada tahun 2012, strategi pengurusan aktif membolehkan kami meraih kelebihan daripada lengkuk kadar hasil yang lebih rendah untuk merealisasikan keuntungan daripada pemegangan kami yang sedia ada. Kami juga meraih manfaat daripada pelbagai usaha korporat penerbit untuk memanfaatkan persekitaran risiko faedah rendah untuk menebus dan/atau membiayai semula Sukuk sedia ada. TINJAUAN KEWANGAN Prestasi Kumpulan Untuk tahun dalam tinjauan, pendapatan kendalian Kumpulan meningkat sebanyak 19% kepada RM1.61 bilion sementara keuntungan sebelum cukai dan zakat (PBTZ) berjumlah RM125.5 juta berbanding RM101.4 juta pada tahun kewangan sebelumnya, iaitu peningkatan sebanyak 24%. Keuntungan selepas cukai dan zakat (PATZ) meningkat sebanyak 31% kepada RM100.1 juta berbanding dengan RM76.4 juta pada tahun kewangan sebelumnya. Pendapatan dan keuntungan yang bertambah baik disebabkan terutamanya oleh peningkatan jualan yang dijana oleh perniagaan takaful keluarga, hasil penaja jaminan dan pelaburan yang lebih baik di samping pendapatan yuran wakalah bersih yang lebihi tinggi susulan pertumbuhan perniagaan yang kukuh. Jumlah saiz aset Malaysia meningkat 9% kepada RM6.4 bilion. Jumlah keuntungan daripada pelaburan, merangkumi laba terealisasi dan perubahan meningkat sebanyak 18% kepada RM363.3 juta pada tahun 2012 berbanding RM307.4 juta pada tahun kewangan sebelumnya. As for the Company s Sukuk portfolio, it recorded an outstanding return of 7.15% despite current low interest rates. Supported by bigger new issuances during the year, our active management strategy enabled us to take advantage of the lower yield curve to realise profit from our existing holdings. We also benefited from numerous corporate exercises of issuers to capitalise on the low-interest risk environment resulting in redemption and/or refinancing of existing Sukuk. FINANCIAL OVERVIEW Group Performance For the year under review, the Group s operating revenue grew by 19% to RM1.61 billion, while profit before taxation and zakat (PBTZ) was measured at RM125.5 million compared to RM101.4 million, increased by 24% from the previous financial year. Profit after tax and zakat (PATZ) grew by 31% to RM100.1 million from RM76.4 million in the previous financial year. The improved revenue and profit were largely attributable to higher sales generated by the family takaful business, better underwriting and investment results and higher net wakalah fee income arising from strong business growth. Malaysia s total asset size increased by 9% to RM6.4 billion. Total profit from investment, comprising realised gains and fair value change, increased by 18% to RM363.3 million in 2012 as compared to RM307.4 million in the previous financial year.

68 066 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Penyata Pengerusi Chairman s Statement Prestasi Syarikat Syarikat mencapai pertumbuhan 36% dalam PBTZ berjumlah RM127.8 juta berbanding dengan RM94.0 juta pada tahun kewangan sebelumnya. Pendapatan kendalian meningkat 23% kepada RM1.41 bilion daripada RM1.14 bilion pada tahun Jumlah Sumbangan Kasar dicatat pada RM1.2 bilion, iaitu peningkatan sebanyak 26% daripada RM1.0 bilion pada tahun Keluarga meningkat sebanyak 49% daripada RM567.7 juta kepada RM848.7 juta. Pertumbuhan hebat perniagaan Keluarga telah mengatasi dengan ketara penurunan sumbangan Am sebanyak 9% kepada RM349.5 juta daripada RM383.3 juta pada tahun kewangan sebelumnya. PBZT yang lebih tinggi disebabkan terutamanya oleh pengunderaitan yang lebih baik, hasil pelaburan dan pendapatan yuran wakalah bersih yang lebih tinggi susulan pertumbuhan kukuh dalam Perniagaan Keluarga. Dividen Malaysia terus mengekalkan pembayaran dividen yang memberangsangkan. Sejajar dengan prestasi kewangan yang lebih kukuh, Lembaga Pengarah telah mengumumkan peningkatan pembayaran dividen interim 25% berjumlah RM40.7 juta bagi tahun kewangan berakhir 31 Disember Jumlah bayaran dividen interim mencerminkan kadar hasil lebih daripada 4% dan lebih tinggi daripada 40% bagi keuntungan selepas cukai dan zakat pada tahun kewangan semasa. TINJAUAN SUBSIDIARI PT Syarikat Indonesia (STI) Subsidiari kami di Indonesia, PT Asuransi Umum (ATU), PT Asuransi Keluarga (ATK) dan Syarikat Indonesia (STI) terus berdepan persaingan sengit daripada peserta konvensional domestik yang masih dibenarkan menjual produk Islam. Akibatnya, sumbangan daripada operasi Indonesia kami kepada perolehan Kumpulan berjumlah kurang 5% daripada jumlah perolehan, dengan sumbangan kasar mencakupi kurang 15% daripada jumlah sumbangan kasar Kumpulan. Company Performance The Company achieved 36% growth in PBTZ amounting to RM127.8 million as compared to RM94.0 million in the previous financial year. Operating revenue increased by 23% to RM1.41 billion from RM1.14 billion in Total Gross contribution was recorded at RM1.2 billion, a 26% increased from the RM1.0 billion in Family grew by 49% from RM567.7 million to RM848.7 million. The tremendous growth in Family business has far outpace the decrease in General contribution of 9% to RM349.5 million from RM383.3 million in the previous financial year. The higher PBZT was largely due to better underwriting, investment results and higher net wakalah fee income arising from strong growth in Family Business. Dividend Malaysia continues to maintain a healthy dividend payout. In line with our stronger financial performance, the Board of Directors has declared an improved interim dividend payout of 25% amounting to RM40.7 million for the financial year ended 31 December The total interim dividends payout translate into a yield of more than 4% and slightly more than 40% of the current financial year profit after taxation and zakat. REVIEW OF SUBSIDIARIES PT Syarikat Indonesia (STI) Our Indonesian subsidiaries, PT Asuransi Umum (ATU), PT Asuransi Keluarga (ATK) and Syarikat Indonesia (STI) continue to face stiff competition from conventional domestic players who are still permitted to sell Islamic products. Consequently, contribution from our Indonesian operations to the Group s bottom line is less than 5% of the total, with gross contribution standing at less than 15% of the Group s total gross contribution.

69 Syarikat Malaysia Berhad ( K) 067 Penyata Pengerusi Laporan Tahunan 2012 Annual Report Chairman s Statement Walau bagaimanapun, kami kekal positif dengan prospek kami di negara tersebut berikutan kehadiran Kumpulan selama 17 tahun di Indonesia dan jangkaan perubahan pengawalseliaan untuk tidak membenarkan operasi produk Islam oleh penanggung insurans konvensional. Keyakinan kami turut diperkukuh oleh populasi negara tersebut yang meningkat dengan pantas, sebahagian besarnya ialah penganut agama Islam. Dengan peningkatan pendapatan yang seiring dengan pembangunan pesat, permintaan bagi perlindungan dan produk pelaburan dalam insurans Islam dan konvensional berkemungkinan meningkat dalam masa terdekat. Bagi tahun 2013, matlamat kami adalah untuk mengembangkan perniagaan kami di Indonesia melalui bank dan agensi runcit. Asean Retakaful International (L) Ltd (ARIL) Susulan proses tukar tertibnya, ARIL dibubarkan secara sukarela dan proses tersebut dijangka akan selesai pada tahun TINJAUAN OPERASI Pada tahun dalam tinjauan, Malaysia telah berjaya melaksanakan sistem pengurusan dokumen untuk operasi Keluarga dan Am. Usaha ini telah mengurangkan masa pusing balik dan penggunaan kertas masing-masing sebanyak 50% dan 80%. Pelanggan agensi runcit kini boleh mengemukakan pertanyaan dalam talian mengenai maklumat sijil mereka malah boleh berinteraksi dengan kakitangan Khidmat Pelanggan kami. Kami juga telah menyepadukan aktiviti penservisan sijil teras dengan integrasi SMS. Kini pelanggan dan ejen akan dimaklumkan melalui SMS mengenai peralihan status untuk membolehkan penyebaran maklumat mengikut permintaan dengan lebih pantas. Maka, semua maklumat yang diperlukan kini boleh diakses dengan mudah dan cepat oleh ejen-ejen yang berkenaan. However, we remain positive of our prospects in the country given the Group s 17-year presence in Indonesia and expected regulatory changes to disallow the operating of Islamic windows by conventional insurers. Our confidence is further bolstered by the country s fast growing population, a large proportion of whom is Muslim. With rising incomes in tandem with rapid development, demand for protection and investment products in Islamic and conventional insurance is likely to increase in the near future. For 2013, our aim remains to grow our Indonesia business via the bank and retail agency force. Asean Retakaful International (L) Ltd (ARIL) Having completed its commutation process, ARIL is voluntarily winding up and the process is expected to be completed in OPERATIONS REVIEW During the year under review, Malaysia successfully implemented its document management system for both Family and General operations. This has decreased both the turnaround time and paper utilisation, by 50% and 80% respectively. Retail agency customers can enquire on their certificate information online and even interact with our Customer Service personnel. We have also integrated core certificate servicing activities with SMS integration. Customers and agents will now be notified via SMS regarding status movement, allowing for faster dissemination of information on demand. With this, all information required is at the finger tip of the respective agents.

70 068 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Penyata Pengerusi Chairman s Statement Satu lagi projek pencapaian yang besar ialah pewujudan pautan Internet berbilang untuk pelbagai portal kami (portal pelanggan, portal rakan kongsi, portal agensi dan laman sesawang korporat). Akses yang lebih tersedia daripada pelbagai Penyedia Perkhidmatan Internet membolehkan kami memberikan perkhidmatan yang lebih baik kepada pelanggan dan mengurangkan kemungkinan masa rosak di portal kami. Portal ini memperkasa warga jualan kami untuk memberikan khidmat pelanggan yang lebih baik. Misalnya, rakan kongsi bank kami kini mempunyai akses terus kepada maklumat pensijilan melalui Portal Banka yang mengurangkan masa pusing balik secara berkesan dari dua minggu kepada sehari. Terdapat juga penjimatan kos yang besar dalam beberapa pelaksanaan projek IT. Perkongsian kami dengan Canon dalam penyelesaian pencetakan telah mengurangkan kos pencetakan kami sebanyak 51%. Membangunkan Warga Kerja Kami Seperti yang lazim, Malaysia terus memberikan keutamaan kepada asetnya yang paling berharga, warga kerja kami. Modal insan Kumpulan adalah dan akan terus kekal menjadi kekuatan paling penting dan kunci kemajuan dan kemampanan kami yang berterusan. Pada tahun 2012, Kumpulan terus merekrut, mengganjari dan membangunkan warga kerjanya untuk memenuhi keperluan operasi. Pelbagai inisiatif, daripada program komprehensif seluruh organisasi hingga kursus khusus, telah dilaksanakan untuk membangunkan kemahiran dan set minda yang diperlukan. Another major milestone project was the creation of multiple internet links for our various portals (customer portals, partner portals, agency portals and corporate website). With high-availability access from different Internet Service Providers, we are able to better serve our customers and reduce potential downtime on our portals. These portals empower our sales force to better serve customers. For example, our bank partners now have direct access to certification information via the Banca Portal, effectively reducing turnaround time from two weeks to a single day. There are also tremendous cost savings in several IT project implementations. Our partnership with Canon on enterprise-wide printing solutions has reduced our printing costs by 51%. Growing Our People As always, Malaysia continues to prioritise its prized asset, our people. The Group s human capital is and will remain our number one strength and the key to our continued progress and sustainability. During the year, the Group continued to recruit, reward and develop its employees to meet its operational requirements. From comprehensive organisation-wide programmes to customised courses, a wide range of initiatives were implemented to develop the required skillsets and mindsets.

71 Syarikat Malaysia Berhad ( K) 069 Penyata Pengerusi Laporan Tahunan 2012 Annual Report Chairman s Statement Usaha berterusan juga telah dilaksanakan untuk menambah baik persekitaran tempat kerja untuk mewujudkan suasana kerja yang kondusif. Melalui usaha-usaha ini serta dasar berorientasikan insan yang lain, matlamat akhir adalah untuk menempatkan Malaysia sebagai majikan pilihan dalam industri insurans. Melangkah ke hadapan, syarikat akan memastikan persekitaran kerja yang sesuai, pakej ganjaran, pengukuran prestasi dan budaya dilaksanakan untuk menarik dan mengekalkan bakat terbaik selain mewujudkan persekitaran yang membolehkan kakitangan bergerak selari dengan visi dan misi Syarikat. TANGGUNGJAWAB SOSIAL KORPORAT Malaysia terus memenuhi aspirasi Tanggungjawab Sosial Korporat (CSR) dengan sumbangan lebih RM1,000,000 kepada pelbagai pertubuhan amal, kebajikan dan sekolah pada tahun Amaun yang disumbangkan adalah lebih tinggi berbanding tahuntahun sebelumnya. Lebih beribu keluarga yang memerlukan, komuniti, kanak-kanak sekolah dan mangsa bencana alam telah meraih manfaat daripada sumbangan ini. Kami juga telah mempercepat kelulusan tuntutan dalam kes tertentu dan memberikan sumbangan zakat kepada kesemua 14 jabatan agama negeri. HARAPAN DAN PROSPEK Meskipun ekonomi global dijangka kekal perlahan, terdapat tandatanda pemulihan beransur-ansur yang jelas. IMF meramalkan KDNK global pada tahun 2013 berkemungkinan akan tinggi sedikit berbanding tahun 2012, iaitu pada kadar 3.6%. Eropah akan terus dibelenggu krisis Eurozone tetapi pemulihan di AS akan dijana oleh penstabilan pasaran perumahan. Di Asia, ekonomi China menunjukkan tanda-tanda pemulihan setelah tujuh suku tahun berturut-turut mengalami kelembapan. Penambahbaikan ini disokong oleh peningkatan eksport, pengeluaran perkilangan, pelaburan aset tetap dan jualan runcit. Paling ketara, negara-negara Asia Tenggara telah mengekalkan trajektori pertumbuhan yang positif. Di dalam negara, ramalan rasmi bagai KDNK Malaysia adalah antara 4.5 hingga 5.5%. Angka ini berdasarkan penggunaan dalam negeri yang mampan dan kebangkitan semula pelaburan sektor swasta. Sementara itu, penggunaan sektor awam dan pelaburan daripada Projek Permulaan (EPP) di bawah Program Transformasi Ekonomi (ETP) berkemungkinan melonjakkan ekonomi selanjutnya pada tahun Continuous efforts were also made to improve the workplace environment towards creating a conducive atmosphere for employees. Through these and other people-oriented policies, the ultimate goal is to position Malaysia as the preferred employer within the insurance industry. Going forward, the Company will ensure the right working atmosphere, remuneration packages, performance measurements and culture are in place to attract and retain the right talent as well as to create an atmosphere that enables staff to be aligned to the Company s vision and mission. CORPORATE SOCIAL RESPONSIBILITY Malaysia continued to fulfil its Corporate Social Responsibility (CSR) aspirations by contributing over RM1,000,000 to various charitable organisations, causes and schools during the year. The amount disbursed was significantly higher than in previous years. Over thousands of needy families, communities, schoolchildren and victims of natural disasters have benefitted from this contribution. We also hastened claim approvals in special cases and made zakat contributions to all 14 state religious departments. PROSPECTS AND OUTLOOK While the global economy is expected to remain sluggish, signs of a gradual recovery are evident. The IMF forecasts that for 2013, global GDP is likely to be slightly higher than in 2012, at 3.6%. Europe is likely to remain mired in the Eurozone crisis but in the US, recovery is being fuelled by stabilisation of housing markets. In Asia, China s economy is showing signs of bottoming-out after seven consecutive quarters of slowdown. The improvement is supported by increasing exports, manufacturing production, fixed asset investment and retail sales. Notably, South East Asian countries have maintained their positive growth trajectory. On the domestic front, official forecast for the Malaysian GDP is between 4.5 to 5.5%. This is based on sustainable domestic consumption and resurgence of private sector investment. Meanwhile, public sector consumption and investment stemming from Entry Point Projects (EPPs) under the Economic Transformation Programme (ETP) are likely to further uplift the economy in 2013.

72 070 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Penyata Pengerusi Chairman s Statement Dalam masa yang mencabar mahupun dipenuhi peluang, syarikat melihat pasaran secara positif. Kadar penembusan yang rendah di samping populasi yang meningkat serta kenaikan pendapatan boleh guna, prospek pertumbuhan adalah menggalakkan. Gabungan usaha sektor awam dan swasta untuk mempromosi dan pengukuhan rangka kerja pengawalseliaan juga telah menyumbang kepada peningkatan penerimaan dalam kalangan pengguna dan pelabur. Walau bagaimanapun, kami menyedari sifat persaingan dalam industri ini, justeru Malaysia bersedia untuk bersaing dengan penyedia dan insurans konvensional untuk meningkatkan perkongsian pasaran dalam industri. Kami menjangkakan produk sumbangan biasa, khususnya perniagaan Keluarga termasuk produk berkait pelaburan akan menjana pertumbuhan. Malaysia merupakan peneraju dalam segmen ini dengan bahagian pasaran 40% dan kami akan memanfaatkan kedudukan teratas kami untuk terus meningkatkan perkongsian pasaran kami. Kami akan turut menembusi seterusnya perniagaan manfaat pekerja dan meluaskan perniagaan am bukan motor. Produk pembiayaan Islam yang memerlukan pengurusan risiko sewajarnya merupakan peluang untuk pertumbuhan selanjutnya bagi industri disebabkan merupakan mekanisme pemindahan risiko yang ideal bagi pembiayaan berlandaskan Syariah. Dari segi strategi, Malaysia akan meneroka usul nilai berorientasikan pelanggan melalui saluran agihan pelbagai di samping terus mengembangkan jenama kami di hati dan minda pasaran. Sehubungan ini, kami akan terus memfokuskan penyampaian perkhidmatan dan nilai berkualiti kepada pelanggan dengan menawarkan pengalaman pelanggan yang terbaik menerusi Pusat mycare. Kami akan sentiasa menilai gabungan jenama kami untuk memastikan penawaran kami mempunyai harga yang kompetitif dan disokong oleh khidmat pelanggan yang hebat, kecekapan operasi dan kedudukan modal yang kukuh untuk menguasai pasaran yang belum diterokai. Usaha ini akan disokong oleh penambahbaikan selanjutnya dalam strategi jualan kami dan inovasi produk dan perkhidmatan. Untuk meningkatkan akses kepada orang ramai, Malaysia berhasrat menambah bilangan agensi kepada 2,500 melalui kempen perekrutan Be myagent. Usaha ini dijangka akan menambah jangkauan dan kebolehaksesan Kumpulan. Pada masa yang sama, kami sedang mengusahakan produk-produk baharu bagi tahun 2013 dan meneroka aplikasi pengurusan hubungan pelanggan (CRM) untuk menambah baik dan mempertingkat perkhidmatan pelanggan. In these times of both challenges and opportunity, the Company views the market positively. With low penetration rates, coupled with a growing population and rising disposal incomes, the growth prospects are good. Combined efforts of the public and private sectors to promote and a strengthening of the regulatory framework have also contributed to growing acceptance among consumers and investors. However, we are fully aware of the competitive nature of our industry, and Malaysia is gearing to compete with both and conventional insurance providers to grow its share of the pie. We will look to regular contribution products, specifically the family business, including investment-linked products to drive growth. Malaysia is a clear leader in this segment with a 40% market share and we will we leverage on our pole position to further expand our share. We will also further penetrate the employee benefits business and broaden our non-motor general business. Islamic financing products, which require appropriate risk management, present an opportunity for further growth of the industry, as would be the ideal risk transfer mechanism for Shariah-compliant financings. In terms of strategy, Malaysia, will look to provide customercentric value propositions via multi distribution channels and to further grow our brand in the hearts and minds of the market. In this regard, we will continue to focus on delivering quality service and value to customers by offering an excellent customer experience via mycare Centres. We will constantly review our brand mix to ensure that our offerings are competitively priced and supported by excellent customer service, operational efficiency and strong capital position to capture the untapped market. This would be supported by further improvement in our sales strategies and innovation in products and services. In further reaching out to the public, Malaysia aims to increase its agency force to 2,500 via the Be myagent recruitment drive, to extend the Group s reach and accessibility. At the same time, we are working on new products for 2013, and are exploring customer relationship management (CRM) applications to enhance and improve our customer service.

73 Syarikat Malaysia Berhad ( K) 071 Penyata Pengerusi Laporan Tahunan 2012 Annual Report Chairman s Statement Kami akan terus mengembangkan inisiatif sedia ada yang telah terbukti berjaya. Kempen We Should Talk merupakan salah satu contoh dan rancangan telah diatur untuk meningkatkan momentumnya pada tahun Kami akan turut memfokuskan pelan mygenlife kami yang menyediakan keperluan perlindungan, simpanan, persaraan dan pelaburan kepada para pelanggan. Ringkasnya, pada tahun 2013 Malaysia akan terus memfokuskan pada empat bidang teras iaitu jangkauan pelanggan, ketangkasan operasi, daya saing kos dan keyakinan pemegang kepentingan. Matlamat unggul kami adalah untuk mengatasi pasaran dan mengukuhkan Kumpulan sebagai pilihan bagi produk perlindungan, sekali gus mengekalkan pertumbuhan perolehan kasar dan perolehan bersih yang mampan. PENGHARGAAN Saya berbesar hati mengumumkan pelantikan Y.Bhg. Dato Othman Abdullah sebagai Pengarah Bukan Eksekutif yang baharu berkuat kuasa 1 Disember Y.Bhg. Dato Othman memiliki pengalaman luas dan akan menjadi aset dalam membantu Lembaga melaksanakan tanggungjawabnya melangkah ke hadapan pada tahun kewangan Bagi pihak Lembaga, saya ingin mengucapkan setinggi-tinggi penghargaan kepada kakitangan Malaysia atas dedikasi dan komitmen mereka yang bersungguh-sungguh serta profesionalisme pada tahun dalam tinjauan. Yang pasti, sumbangan mereka merupakan komponen penting bagi pertumbuhan kita pada tahun We will also continue building on existing initiatives that have proven to be successful. The We Should Talk campaign is one such example and plans are in place to up the momentum in We will also focus on our mygenlife plan that gives customers protection, savings, retirement and investment needs all in one. In essence, Malaysia in 2013 will continue to emphasise the four core areas of customer reach, operational agility, cost competitiveness and stakeholder confidence. Our ultimate goal is to outpace the market and firmly establish ourselves as the preferred choice for protection products and by doing so, delivering sustainable top line and bottom line growth. ACKNOWLEDGEMENTS I am pleased to announce the appointment of Y. Bhg. Dato Othman Abdullah as a new Independent Non-Executive Director effective 1 December Y.Bhg. Dato Othman brings a wealth of experience with him and will be an asset in assisting the Board to discharge its duties going forward into FY2013. On behalf of the Board, I wish to express our sincere appreciation to the staff of Malaysia for their tireless dedication and commitment and their consummate professionalism during the year under review. Without a doubt, their contributions have been a key component of our growth during the year under review.

74 072 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Penyata Pengerusi Chairman s Statement Lembaga juga ingin mengucapkan terima kasih kepada Pasukan Pengurusan kerana menerajui Malaysia menuju setahun lagi pertumbuhan yang cemerlang; rakan kongsi perniagaan dan pelanggan atas sokongan mereka; dan pemegang saham atas keyakinan mereka yang tidak berbelah-bagi terhadap syarikat sepanjang tahun Akhir sekali, saya ingin menyampaikan penghargaan kepada ahli-ahli Lembaga Pengarah, Jawatankuasa Pengarah dan Badan Penasihat Syariah atas nasihat mereka sepanjang tahun pertumbuhan dan kemajuan positif bagi Malaysia. The Board also wishes to extend its thanks to Management Team for helming Malaysia to another year of sterling growth; its business partners and customers for their support; and our shareholders for their unwavering confidence in the Company throughout the year under review. Last but not least, I wish to express my gratitude to my fellow Members of the Board, Board Committees and the Shariah Advisory Body for their guidance in what has been a positive year of growth and progress for Malaysia. Y. Bhg. Dato Paduka Ismee Ismail Pengerusi Y. Bhg. Dato Paduka Ismee Ismail Chairman

75 FINANCIAL STATEMENTS Directors Report Statement by Directors Statutory Declaration Independent Auditors Report Report of the Shariah Advisory Body Statements of Financial Position Statements of Profit or Loss and Other Comprehensive Income Statements of Changes In Equity Statements of Cash Flows

76 074 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Directors Report for the year ended 31 December 2012 The Directors have pleasure in submitting their report and the audited financial statements of the Group and of the Company for the financial year ended 31 December Principal activities The Company is principally engaged in managing of family and general takaful businesses, whilst the principal activities of the subsidiaries are as stated in Note 5 to the financial statements. There has been no significant change in the nature of these activities during the financial year. Results Group Company Profit for the year attributable to: Owners of the Company 101, ,657 Non-controlling interests (1,101) - 100, ,657 Reserves and provisions There were no material transfers to or from reserves and provisions during the financial year under review, except as disclosed in the financial statements. Dividends Since the end of the previous financial year, the Company: i) Paid a final single tier dividend of 10 sen per ordinary share totalling RM16,281,700 in respect of the financial year ended 31 December 2011 on 28 May 2012; ii) iii) Declared a first interim single tier dividend of 15 sen per ordinary share totalling RM24,422,550 in respect of the financial year ended 31 December 2012 on 7 August 2012 and paid on 21 September 2012; and Declared a second interim single tier dividend of 10 sen per ordinary share totalling RM16,281,700 in respect of the financial year ended 31 December 2012 on 14 December 2012 and paid on 11 January No final dividend recommended to be paid for the year under review by the Directors.

77 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 075 Directors Report for the year ended 31 December 2012 Directors of the Company Directors who served since the date of the last report are: Y. Bhg. Dato Paduka Ismee Ismail Y. Bhg. Dato Mohamed Hassan Md. Kamil Y. Bhg. Dato Sulaiman Mohd Yusof Puan Rozaida Omar Encik Mahadzir Azizan Encik Johan Abdullah Encik Zakaria Ismail Y. Bhg. Dato Othman Abdullah (appointed w.e.f ) In accordance with Article 62 of the Company s Articles of Association, Encik Mahadzir Azizan, Y. Bhg. Dato Sulaiman Mohd Yusof and Encik Zakaria Ismail will retire at the forthcoming Annual General Meeting and, being eligible, offer themselves for re-election. In accordance with Article 66A of the Company s Articles of Association, Y. Bhg. Dato Othman Abdullah will retire at the forthcoming Annual General Meeting and, being eligible, offers himself for re-election. Directors interests in shares None of the Directors holding office at 31 December 2012 had any interest in the shares and options over shares of the Company and of its related corporations during the financial year. Issue of shares and debentures There were no changes in the authorised, issued and paid-up capital of the Company during the financial year. There were no debentures issued during the financial year. Options granted over unissued shares No options were granted to any person to take up unissued shares of the Company during the financial year. Directors benefits Since the end of the previous financial year, no Director of the Company has received nor become entitled to receive any benefit (other than a benefit included in the aggregate amount of emoluments received or due and receivable by Directors as shown in the financial statements or the fixed salary of a full time employee of the Company or of related corporations) 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.

78 076 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Directors Report for the year ended 31 December 2012 Statement on corporate governance and internal controls (a) Board responsibilities The Board of Directors (the Board) is ultimately responsible for the proper stewardship of the Group s and Company s resources, the achievement of corporate objectives and good corporate citizenship and discharges this responsibility through compliance with the (Amendment) Act, 1984 and Bank Negara Malaysia s (BNM) Guidelines on Directorship for Operators (BNM/RH/GL 004-1) and other directives, in addition to adopting other best practices on corporate governance. The Board comprises seven non-executive directors and one executive director to enable a balanced and objective consideration of issues, hence facilitating optimal decision making. The executive director adds value to the decision making process by providing a management and operational perspective to issues placed before the Board. (b) Management accountability The Group and the Company have an organisational structure showing all reporting lines as well as clearly documented job descriptions for all management and executive employees. Authority limits, as approved by the Board, are clearly established and made available to all employees. (c) Corporate independence The Group and the Company have complied with BNM s Guidelines on Related Party Transactions for Operators (BNM/RH/GL 004-7). Necessary disclosures have been made to the Board and when required, prior Board s approval has been obtained. All material related party transactions have been disclosed in Note 40 to the financial statements. (d) Internal controls and operational risk management The Board has overall oversight responsibility to ensure the Group and the Company maintain an adequate system of internal controls, effective and efficient operations, and risk management, as well as procedures to ensure compliance with laws, regulations, internal guidelines and requirements to safeguard the assets of the Group and the Company and stakeholders interests. The Group and the Company established the Operational Risk Management Framework to ensure an ongoing process of identifying, evaluating, monitoring and managing the significant risk exposures surrounding its business operations. All new products are governed by the Group s and the Company s Product Development Framework. The Management Committee and Appointed Actuary are required to approve before any product can be launched. A product risk assessment also forms part of the process for new product approvals. Whistle Blowing Policy & Fraud and Integrity Policy, Shariah Governance Framework and Assets and Liabilities Management Framework are also in place to provide basic structure and further strengthen the existing control mechanism underlying the business activities. Business Continuity Management is consistently practiced and tested annually to safeguard the lives of the employees and others in the office premises and ensure the business is up and running at all times. The Board, Group Managing Director and Management Committee are consciously committed to the risk culture and ensure Board Risk Committee and Management Risk Committee perform as required.

79 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 077 Directors Report for the year ended 31 December 2012 Statement on corporate governance and internal controls (continued) (e) Public accountability As custodian of public funds, the Group s and the Company s dealings with the public are always conducted fairly, honestly and professionally. (f) Financial reporting The Group and the Company have maintained proper accounting records and the Group s and the Company s financial statements are prepared in accordance with Malaysian Financial Reporting Standards (MFRS) issued by the Malaysian Accounting Standards Board (MASB), International Financial Reporting Standards (IFRS), the provisions of the Companies Act, 1965, the (Amendment) Act, 1984 and Guidelines/ Circular issued by BNM and Principles of Shariah. Other statutory information Before the financial statements of the Group and of the Company were made out, the Directors took reasonable steps to ascertain that: i) all known impaired debts have been written off and adequate impairment allowance made for impaired debts, ii) iii) any current assets which were unlikely to be realised in the ordinary course of business have been written down to an amount which they might be expected so to realise, and there was adequate provision for incurred claims, including Incurred But Not Reported (IBNR) claims. At the date of this report, the Directors are not aware of any circumstances: i) that would render the amount written off for impaired debts or the amount of the provision for impaired debts and provision for incurred claims including IBNR claims in the Group and in the Company inadequate to any substantial extent, or ii) iii) iv) that would render the value attributed to the current assets in the financial statements of the Group and of the Company misleading, or which have arisen which render adherence to the existing method of valuation of assets or liabilities of the Group and of the Company misleading or inappropriate, or not otherwise dealt with in this report or the financial statements, that would render any amount stated in the financial statements of the Group and of the Company misleading. At the date of this report, there does not exist: i) any charge on the assets of the Group or of the Company that has arisen since the end of the financial year and which secures the liabilities of any other person, or ii) any contingent liability in respect of the Group or of the Company that has arisen since the end of the financial year. No contingent liability or other liability of any company in the Group 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 substantially affect the ability of the Group and of the Company to meet their obligations as and when they fall due.

80 078 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Directors Report for the year ended 31 December 2012 Statement on corporate governance and internal controls (continued) Other statutory information (continued) For the purpose of this paragraph, contingent and other liabilities do not include liabilities arising from contracts of takaful underwritten in the ordinary course of business of the Group and of the Company. In the opinion of the Directors, the financial performance of the Group and of the Company for the financial year ended 31 December 2012 have not been substantially affected by any item, transaction or event of a material and unusual nature nor has any such item, transaction or event occurred in the interval between the end of the financial year and the date of this report. Auditors The auditors, Messrs KPMG Desa Megat & Co., have indicated their willingness to accept re-appointment. Signed on behalf of the Board of Directors in accordance with a resolution of the Directors: Dato Paduka Ismee Ismail Dato Mohamed Hassan Md. Kamil Kuala Lumpur Date: 15 March 2013

81 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 079 Statement by Directors pursuant to Section 169(15) of the Companies Act, 1965 In the opinion of the Directors, the financial statements set out on pages 85 to 326 are drawn up in accordance with Malaysian Financial Reporting Standards, International Financial Reporting Standards and the Companies Act, 1965 in Malaysia and comply with the Principles of Shariah so as to give a true and fair view of the financial position of the Group and of the Company as of 31 December 2012 and of their financial performance and cash flows for the financial year then ended. In the opinion of the Directors, the information set out in Note 42 on page 327 to the financial statements have been compiled in accordance with the Guidance on Special Matter No.1, Determination of Realised and Unrealised Profits or Losses in the Context of Disclosures 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 Directors: Dato Paduka Ismee Ismail Dato Mohamed Hassan Md. Kamil Kuala Lumpur Date: 15 March 2013

82 080 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Statutory Declaration pursuant to Section 169(16) of the Companies Act, 1965 I, Lee Hin Sze, the officer primarily responsible for the financial management of Syarikat Malaysia Berhad, do solemnly and sincerely declare that the financial statements set out on pages 85 to 327 are, to the best of my knowledge and belief, correct and I make this solemn declaration conscientiously believing the same to be true, and by virtue of the provisions of the Statutory Declarations Act, Subscribed and solemnly declared by the above named in Kuala Lumpur in the Federal Territory on 15 March Lee Hin Sze Before me:

83 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 081 Independent Auditors Report to the members of Syarikat Malaysia Berhad (Company No K) (Incorporated in Malaysia) Report on the Financial Statements We have audited the financial statements of Syarikat Malaysia Berhad, which comprise the statements of financial position as at 31 December 2012 of the Group and of the Company, and the statements of profit or loss and other comprehensive income, changes in equity and, cash flows of the Group and of the Company for the year then ended, and a summary of significant accounting policies and other explanatory information, as set out on pages 85 to 326. Directors Responsibility for the Financial Statements The Directors of the Company are responsible for the preparation of these 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 controls 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 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 entity s preparation of financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by 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 December 2012 and of their financial performance and cash flows for the year then ended in accordance with Malaysian Financial Reporting Standards, International Financial Reporting Standards and the requirements of the Companies Act, 1965 in Malaysia. 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 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.

84 082 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Independent Auditors Report to the members of Syarikat Malaysia Berhad (Company No K) (Incorporated in Malaysia) Report on Other Legal and Regulatory Requirements (continued) c) We are satisfied that the accounts of the subsidiaries that have been consolidated with the Company s 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 audit reports on the accounts of the subsidiaries did not contain any qualification or any adverse comment made under Section 174(3) of the Act. Other Reporting Responsibilities Our audit was made for the purpose of forming an opinion on the financial statements taken as a whole. The information set out in Note 42 on page 327 to the financial statements has been compiled by the Company as required by the Bursa Malaysia Securities Berhad Listing Requirements and is not required by the Malaysian Financial Reporting Standards or International Financial Reporting Standards. We have extended our audit procedures to report on the process of compilation of such information. In our opinion, the information has been properly compiled, in all material respects, in accordance with the Guidance on Special Matter No.1, Determination of Realised and Unrealised Profits or Losses in the Context of Disclosures 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. 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. KPMG Desa Megat & Co Firm Number: AF 0759 Chartered Accountants Mok Wan Kong Approval Number: 2877/12/14 (J) Chartered Accountant Petaling Jaya, Selangor Date: 15 March 2013

85 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 083 Report of the Shariah Advisory Body We have reviewed the principles and the contracts relating to the products and transactions introduced by Syarikat Malaysia Berhad ( Malaysia) during the financial year ended 31 December We have also conducted our reviews as to whether the business, operations and activities of Malaysia are in compliance with the Shariah and the Shariah rulings as issued by the Shariah Advisory Council of Bank Negara Malaysia. The Management of Malaysia is responsible in ensuring that Malaysia conducts its business, operations and activities in accordance with the Shariah. It is our responsibility to form an independent opinion, based on our reviews of the operations of Malaysia. We have assessed all work presented by examining them on a test case basis, evaluating each type of transaction, its relevant documentation and procedures as adopted by Malaysia. Our assessments were planned in a way to ensure all the information and explanations considered necessary for Shariah compliance were obtained so that there were no violation. In carrying out our roles and responsibilities, we hereby submit the following report for the financial year ended 31 December 2012: 1. The Shariah Advisory Body (SAB) held six (6) meetings to review various products, transactions and processes in line with the Shariah; 2. In the said meetings, we discussed and approved two (2) new products as well as deliberations on other issues in relation to products; 3. We also approved the revised product documents arising as a result of the change in the model from Mudharabah to Wakalah; and 4. Furthermore, we also approved the Mudharabah (profit) and surplus distribution rate declarations for Family and General products. In our opinion: 1. The contracts, transactions and dealings entered into by Malaysia during the financial year ended 31 December 2012 were in compliance with the Shariah; 2. All investments were Shariah compliant; 3. The allocation of profits and losses charged in relation to investment accounts conformed to the Shariah principles; 4. All earnings from all sources or by means prohibited by the Shariah were considered for disposal to charitable causes; and 5. The calculation of zakat was in compliance with the Shariah.

86 084 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Report of the Shariah Advisory Body We, the members of the Shariah Advisory Body of Malaysia, do hereby confirm that the operations of Malaysia for the financial year ended 31 December 2012 were conducted in conformity with the Shariah. We bear witness only to what we know, and we could not well guard against the unseen! (surah Yusuf, verse: 81) Chairman of the SAB : Dr. Ahmad Sobri Salamon Member of the SAB : Ustaz Mohd. Bakir Hj. Mansor Kuala Lumpur Date: 15 March 2013

87 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 085 Statements of Financial Position as at 31 December 2012 Group Note Operator Family General Group Operator Family General Group Operator Family General Group Assets Property and equipment 3 29, ,064 28, ,720 30, ,190 Investment properties 4 18, ,813 25,774 45,470 18, ,619 26,620 46,572 11, ,980 29,234 47,493 Investment in associates Other investments 7 394,213 3,485, ,339 4,439, ,445 2,999, ,119 3,738, ,418 2,885, ,215 3,495,262 Retakaful assets 8-82, , ,303-72, , ,424-43, , ,133 Deferred tax assets 9 34, ,382 15, ,811 10, ,422 Loans and receivables, excluding takaful receivables , , , , , , , , , , , ,060 receivables 11-68,472 25,541 94,013-62,352 47, ,814-43,657 63, ,222 Qardh receivables , Cash and cash equivalents , ,172 61, ,252 61, ,492 47, ,527 75, ,678 69, ,875 Assets held for sale 14 1,340 1, , Total assets Equity and liabilities 714,234 4,579,480 1,185,354 6,371, ,446 4,187,361 1,148,083 5,845, ,987 3,892,195 1,062,517 5,366,657 Share capital , , , , , ,817 Reserves ,513 (11,189) (23,394) 336, ,760 (10,816) (19,074) 287, ,173 (10,816) (19,074) 231,173 Total equity attributable to owners of the company 499,330 (11,189) (23,394) 499, ,577 (10,816) (19,074) 450, ,990 (10,816) (19,074) 393,990 Non-controlling interests 26, ,113 27, ,469 27, ,339 Total equity 525,658 (11,189) (23,394) 525, ,046 (10,816) (19,074) 478, ,329 (10,816) (19,074) 421,329

88 086 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Statements of Financial Position as at 31 December 2012 Group Note Operator Family General Group Operator Family General Group Operator Family General Group LIABILITIES Qardh payables 16-10,398 23, ,398 20, ,173 19,074 - contract liabilities 17-4,403,336 1,100,743 5,463,099-4,038,164 1,067,694 5,067,636-3,720, ,046 4,644,401 Expense reserves 18 89, ,486 19, ,739 12, ,502 payables 19-20,501 22,625 43,126-19,496 26,041 45,537-15,217 35,237 50,454 Other payables 20 84, ,434 61, ,013 65, ,119 52, ,357 35, ,406 66, ,124 Current tax liabilities 14, ,559 10, ,664 24, ,847 Total liabilities 188,576 4,590,669 1,208,748 5,846,283 96,400 4,198,177 1,167,157 5,367,933 72,658 3,903,011 1,081,591 4,945,328 Total equity and liabilities 714,234 4,579,480 1,185,354 6,371, ,446 4,187,361 1,148,083 5,845, ,987 3,892,195 1,062,517 5,366,657

89 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 087 Statements of Financial Position as at 31 December 2012 Company Note Operator Family General Company Operator Family General Company Operator Family General Company Assets Property and equipment 3 18, ,405 21, ,457 23, ,966 Investment properties 4 17, ,824 25,774 44,479 17, ,435 26,620 45,430 11, ,172 29,234 46,361 Investment in subsidiaries 5 63, ,729 63, ,729 70, ,747 Investment in associates Other investments 7 384,209 3,278, ,164 4,217, ,631 2,826, ,375 3,549, ,377 2,736, ,496 3,334,638 Retakaful assets 8-75, , ,935-66, , ,902-37, , ,708 Deferred tax assets 9 30, ,623 11, ,301 3, ,495 Loans and receivables, excluding takaful receivables , , , , , , , , , , , ,614 receivables 11-62,893 17,605 80,498-54,355 31,496 85,851-35,292 42,415 77,707 Cash and cash equivalents 13 49, ,248 42, ,780 27, ,447 32, ,999 27, ,266 50, ,983 Assets held for sale 14 1,340 1, , Total assets 675,993 4,259,258 1,123,241 5,963, ,323 3,887,960 1,073,410 5,440, ,153 3,628, ,412 4,966,219 Equity and liabilities Share capital , , , , , ,817 Reserves , , , , , ,953 Total equity attributable to owners of the company 504, , , , , ,770

90 088 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Statements of Financial Position as at 31 December 2012 Company Note Operator Family General Company Operator Family General Company Operator Family General Company LIABILITIES contract liabilities 17-4,098,783 1,042,433 5,100,236-3,753,785 1,003,813 4,719,376-3,469, ,792 4,289,788 Expense reserves 18 84, ,973 15, ,758 9, ,800 payables 19-15,318 20,505 35,823-15,930 23,522 39,452-12,233 31,096 43,329 Other payables 20 72, ,157 60, ,778 55, ,245 46, ,166 22, ,373 62, ,870 Current tax liabilities 14, ,236 10, ,372 24, ,662 Total liabilities 171,889 4,259,258 1,123,241 5,459,046 81,398 3,887,960 1,073,410 4,985,124 57,383 3,628, ,412 4,562,449 Total equity and liabilities 675,993 4,259,258 1,123,241 5,963, ,323 3,887,960 1,073,410 5,440, ,153 3,628, ,412 4,966,219 The notes on pages 99 to 326 are an integral part of these financial statements.

91 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Statements of Profit or Loss and Other Comprehensive Income for the year ended 31 December Note Operator Family Group General Family Group Operator General Group Operating revenue 21 19,456 1,159, ,468 1,607,534 14, , ,421 1,345,473 operator income 476, , Gross earned contributions 22(i) - 987, ,129 1,444, , ,747 1,096,076 Contributions ceded to retakaful 22(ii) - (46,869) (121,955) (168,824) - (28,671) (114,401) (143,072) Net earned contributions 22(iii) - 940, ,174 1,275, , , ,004 Administrative income ,158 23, ,708 24,708 Investment income 23 19, ,381 31, ,569 14, ,760 28, ,630 Realised gains and (losses) 24 9,699 98,082 13, ,289 9,299 71,641 16,389 97,329 Fair value gains and (losses) ,634 (306) 8,591 1,460 12, ,436 Other operating income 26 10,852 6,587 5,675 16,543 10,238 37,116 45,711 86,979 Other income 40, ,871 73, ,337 35, , , ,082 Gross benefits and claims paid 27 - (484,087) (173,590) (654,024) - (432,862) (189,669) (618,544) Claims ceded to retakaful 27-29,475 26,523 55,998-22,113 38,902 61,015 Gross change to contract liabilities 27 - (46,333) (55,655) (101,988) - (49,603) (66,550) (116,153) Change to contract liabilities ceded to retakaful 27-10,758 30,169 40,927-5,630 16,141 21,771 Net benefits and claims 27 - (490,187) (172,553) (659,087) - (454,722) (201,176) (651,911) Wakalah fee expense - (186,041) (94,226) - - (121,096) (23,337) - Commission expense/administrative fees (103,297) (9,642) (9,532) (122,247) (61,636) (6,383) (32,809) (100,737) Expense reserves 18 (70,110) - - (70,110) (7,317) - - (7,317) Management expenses 28 (208,039) - - (205,721) (189,714) - - (187,068) Other operating expenses 30 (8,838) (12,722) (5,319) (23,689) (3,092) (9,544) (5,458) (18,097) Other expenses (390,284) (208,405) (109,077) (421,767) (261,759) (137,023) (61,604) (313,219) Total profit for the year 127, , , , , , , ,956 Profit attributable to the Operator/ participants - (544,718) (131,231) (472,514) - (360,829) (140,549) (305,538) Profit before taxation and zakat 127,116 (647) (4,621) 125, , ,418 Zakat (1,000) - - (1,000) (733) - - (733) Tax expense 31 (24,526) - - (24,314) (24,306) - - (24,306) Profit for the year 101,590 (647) (4,621) 100,144 76, ,379

92 090 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Statements of Profit or Loss and Other Comprehensive Income for the year ended 31 December 2012 Note Operator Family Company General Family Company Operator General Company Operating revenue 21 17,000 1,013, ,711 1,407,489 11, , ,239 1,140,915 operator income 415, , Gross earned contributions 22(i) - 862, ,259 1,259, , , ,720 Contributions ceded to retakaful 22(ii) - (33,244) (112,989) (146,233) - (12,609) (89,892) (102,501) Net earned contributions 22(iii) - 829, ,270 1,113, , , ,219 Administrative income ,401 22, ,708 24,708 Investment income 23 17, ,218 30, ,708 11, ,058 27, ,253 Realised gains and (losses) 24 9,047 92,909 13, ,314 8,555 69,681 16,311 94,547 Fair value gains and (losses) ,256 (306) 8,796 1,450 9, ,821 Other operating income 26 7,141 5,514 4,953 11,037 6,907 36,017 41,157 77,995 Other income 34, ,084 70, ,443 28, , , ,324 Gross benefits and claims paid 27 - (415,977) (153,229) (565,553) - (366,998) (154,862) (517,873) Claims ceded to retakaful 27-19,349 23,382 42,731-14,795 26,638 41,433 Gross change to contract liabilities 27 - (46,980) (68,108) (115,088) - (49,222) (96,318) (145,540) Change to contract liabilities ceded to retakaful 27-10,530 37,678 48,208-5,510 47,304 52,814 Net benefits and claims 27 - (433,078) (160,277) (589,702) - (395,915) (177,238) (569,166) Wakalah fee expense - (155,362) (70,501) - - (84,490) - - Commission expense/administrative fees (74,865) (9,642) (9,330) (93,613) (30,268) (6,383) (31,145) (67,705) Expense reserves 18 (69,215) - - (69,215) (5,958) - - (5,958) Management expenses 28 (171,234) - - (168,813) (151,552) - - (148,874) Other operating expenses 30 (5,091) (11,596) (3,732) (20,599) (8,894) (9,544) (5,458) (23,888) Other expenses (320,405) (176,600) (83,563) (352,240) (196,672) (100,417) (36,603) (246,425) Total profit for the year 128, , , ,772 93, , , ,952 Profit attributable to the Operator/ participants - (493,884) (111,000) (410,952) - (323,550) (141,777) (275,993) Profit before taxation and zakat 128, ,820 93, ,959 Zakat (789) - - (789) (474) - - (474) Tax expense 31 (24,586) - - (24,374) (21,776) - - (21,776) Profit for the year 103, ,657 71, ,709

93 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 091 Statements of Profit or Loss and Other Comprehensive Income for the year ended 31 December 2012 Note Operator Group General Family Group Operator Family General Group Profit for the year 101,590 (647) (4,621) 100,144 76, ,379 Other comprehensive income/(expense) (net of tax) Fair value change of available-for-sale financial assets 2,905 (13,384) 1,084 2,905 (2,653) 5,370 (9,285) (2,653) Foreign currency translation differences for foreign operations (6,321) 17 1,476 (6,036) 961 3,332 (892) 961 Revaluation of property and equipment 6, ,510 (60) ,415 Other comprehensive income attributable to Operator/change in participants liabilities - 13,641 (2,259) (6,222) - (8,702) 10,177 (12,475) Total other comprehensive income/ (expense) for the year 3, ,157 (1,752) - - (1,752) Total comprehensive income for the year 104,598 (373) (4,320) 104,301 74, ,627 Profit/(Loss) for the year attributable to: Owners of the Company 102,476 (647) (4,621) 101,245 76, ,785 Non-controlling interests (886) - - (1,101) (406) - - (406) 101,590 (647) (4,621) 100,144 76, ,379 Total comprehensive income/(expense) for the year attributable to: Owners of the Company 105,739 (373) (4,320) 105,657 74, ,497 Non-controlling interests (1,141) - - (1,356) ,598 (373) (4,320) 104,301 74, ,627 Basic earnings per ordinary share (sen)

94 092 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Statements of Profit or Loss and Other Comprehensive Income for the year ended 31 December 2012 Operator Company General Family Company Operator Family General Company Profit for the year 103, ,657 71, ,709 Other comprehensive income/(expense) (net of tax) Fair value change of available-for-sale financial assets 2,815 (12,938) 1,021 2,815 (2,584) 8,118 (9,218) (2,584) Revaluation of property and equipment ,654 (60) ,697 Other comprehensive income attributable to Operator/change in participants liabilities - 12,938 (1,021) (4,961) - (8,118) 9,218 (11,757) Total other comprehensive income for the year 2, ,508 (2,644) - - (2,644) Total comprehensive income for the year 106, ,165 69, ,065 Profit/(Loss) for the year attributable to: Owners of the Company 103, ,657 71, , , ,657 71, ,709 Total comprehensive income/(expense) for the year attributable to: Owners of the Company 106, ,165 69, , , ,165 69, ,065 The notes on pages 99 to 326 are an integral part of these financial statements.

95 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 093 Statements of Changes in Equity for the year ended 31 December 2012 Note Share capital Share premium Attributable to owners of the Company Non-distributable Distributable Translation reserve Revaluation reserve Fair value reserve Retained profits Total Noncontrolling interests Total equity Group At 1 January ,817 4,098 (6,289) 614 7, , ,990 27, ,329 Foreign currency translation differences for foreign operations Revaluation of property and equipment (60) - - (60) - (60) Fair value of available-for-sale financial assets - Gains arising during the year ,452-4, ,486 - Reclassification adjustments for gains included in profit or loss (7,075) - (7,075) (64) (7,139) Other comprehensive income/ (expense) for the year (60) (2,623) - (2,288) 536 (1,752) Profit/(Loss) for the year ,785 76,785 (406) 76,379 Total comprehensive income/ (expense) for the year (60) (2,623) 76,785 74, ,627 Contributions by and distributions to owners of the company - Dividends to owners of the Company (17,910) (17,910) - (17,910) Total transactions with owners of the Company (17,910) (17,910) - (17,910) At 31 December ,817 4,098 (5,894) 554 4, , ,577 27, ,046 Note 15 Note 15 Note 15 Note 15

96 094 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Statements of Changes in Equity for the year ended 31 December 2012 Attributable to owners of the Company Note Share capital Share premium Non-distributable Translation reserve Revaluation reserve Fair value reserve Distributable Retained profits Total Noncontrolling interests Total equity Group At 1 January ,817 4,098 (5,894) 554 4, , ,577 27, ,046 Foreign currency translation differences for foreign operations - - (2,940) (2,940) (3,096) (6,036) Revaluation of property and equipment , ,486 2,802 7,288 Fair value of available-for-sale financial assets - Gains arising during the year ,332-12, ,611 - Reclassification adjustments for gains included in profit or loss (9,466) - (9,466) (240) (9,706) Other comprehensive (expense)/income for the year - - (2,940) 4,486 2,866-4,412 (255) 4,157 Profit/(Loss) for the year , ,245 (1,101) 100,144 Total comprehensive (expense)/ income for the year - - (2,940) 4,486 2, , ,657 (1,356) 104,301 Contributions by and distributions to owners of the company - Dividends to owners of the Company (56,986) (56,986) - (56,986) Total transactions with owners of the Company (56,986) (56,986) - (56,986) At 31 December ,817 4,098 (8,834) 5,040 7, , ,248 26, ,361 Note 15 Note 15 Note 15 Note 15 The notes on pages 99 to 326 are an integral part of these financial statements.

97 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 095 Statements of Changes in Equity for the year ended 31 December 2012 Attributable to owners of the Company Non-distributable Distributable Note Share capital Share premium Revaluation reserve Fair value reserve Retained profits Total equity Company At 1 January ,817 4, , , ,770 Revaluation of property and equipment - - (60) - - (60) Fair value of available-for-sale financial assets - Gains arising during the year ,811-3,811 - Reclassification adjustments for gains included in profit or loss (6,395) - (6,395) Other comprehensive expense for the year - - (60) (2,584) - (2,644) Profit for the year ,709 71,709 Total comprehensive (expense)/ income for the year - - (60) (2,584) 71,709 69,065 Contributions by and distributions to owners of the company - Dividends to owners of the Company (17,910) (17,910) Total transactions with owners of the Company (17,910) (17,910) At 31 December ,817 4, , , ,925 Note 15 Note 15 Note 15 Note 15

98 096 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Statements of Changes in Equity for the year ended 31 December 2012 Note Share capital Attributable to owners of the Company Non-distributable Distributable Share premium Revaluation reserve Fair value reserve Retained profits Total equity Company At 1 January ,817 4, , , ,925 Revaluation of property and equipment Fair value of available-for-sale financial assets - Gains arising during the year ,505-9,505 - Reclassification adjustments for gains included in profit or loss (6,690) - (6,690) Other comprehensive income for the year ,815-3,508 Profit for the year , ,657 Total comprehensive income/(expense) for the year , , ,165 Contributions by and distributions to owners of the company - Dividends to owners of the Company (56,986) (56,986) Total transactions with owners of the Company (56,986) (56,986) At 31 December ,817 4,098 1,247 7, , ,104 Note 15 Note 15 Note 15 Note 15 The notes on pages 99 to 326 are an integral part of these financial statements.

99 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 097 Statements of Cash Flows for the year ended 31 December Group Company 2011 Cash flows from operating activities Profit before zakat and taxation 125, , ,820 93,959 Adjustments for: Depreciation 15,161 14,260 13,059 12,382 Fair value change of investment properties (2,257) 2,734 (2,315) 2,733 Fair value change of fair value through profit or loss financial assets (6,334) (8,170) (6,481) (5,554) Profit from financing receivables (651) (843) (651) (843) Profit from Islamic debt securities, investment accounts and Islamic accepted bills (171,578) (145,814) (147,563) (131,471) Dividend income from Shariah approved shares (34,522) (24,057) (34,522) (24,057) Gains on disposal of available-for-sale financial assets (121,202) (97,597) (115,260) (94,815) Gains on disposal of property and equipment (159) (29) (126) (29) Losses on disposal of investment properties Losses on disposal of assets held for sale Write off of property and equipment Amortisation of premiums, net of accretion of discounts 7,047 (1,741) 6,864 (1,741) Impairment loss of available-for-sale financial assets 8,304 8,250 8,304 8,250 Impairment loss of investment in a subsidiary ,018 Impairment loss of investment properties Impairment loss of property and equipment Profit from Malaysian Government Islamic papers (29,350) (27,345) (29,350) (27,345) Operating loss before changes in working capital (209,091) (178,461) (179,598) (161,051) Profit from Islamic debt securities, investment accounts, Islamic accepted bills and profit from Malaysian Government Islamic papers 200, , , ,816 Dividend income from Shariah approved shares 34,522 14,590 34,522 14,590 Increase in retakaful assets (25,035) (88,155) (31,033) (126,194) Decrease/(Increase) in receivables 282,365 (137,647) 250,249 (117,877) Increase in contract liabilities 431, , , ,293 Increase in payables 65,378 14,975 72,544 7, , , , ,885 Zakat paid (446) (1,288) (224) (405) Income taxes paid (41,119) (42,905) (41,176) (43,012) Net cash generated from operating activities 739, , , ,468

100 098 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Statements of Cash Flows for the year ended 31 December Group Company 2011 Cash flows from investing activities Purchase of investments (2,594,661) (2,060,964) (2,443,851) (1,815,869) Proceeds from sale of investments 1,927,213 1,742,787 1,834,267 1,653,632 Maturity of other investments 52, ,174 40,000 44,774 Purchase of property and equipment (7,474) (13,155) (6,887) (11,992) Proceeds from sale of property and equipment Purchase of investment properties - (5,535) - (5,535) Proceeds from sale of investment properties - 7,403-7,403 Proceeds from sale of assets held for sale Net cash used in investing activities (621,973) (154,152) (575,740) (127,542) Cash flows from financing activity Dividends paid to owners of the Company (40,704) (17,910) (40,704) (17,910) Net cash used in financing activity (40,704) (17,910) (40,704) (17,910) Net increase/(decrease) in cash and cash equivalents 76,382 (3,611) 53,781 7,016 Effect of exchange rate fluctuations on cash held (10,657) 1, Cash and cash equivalents at 1 January 386, , , ,983 Cash and cash equivalents at 31 December 452, , , ,999 Cash and cash equivalents Cash and cash equivalents included in the statements of cash flows comprise the following statements of financial position amounts: 2012 Group Company 2011 Cash and bank balances and fixed and call deposits with licensed financial institution with maturity less than three months - Operator (Note 13) 102,972 61,265 49,017 27,811 - Family Fund (Note 13) 288, , , ,447 - General Fund (Note 13) 61,108 47,770 42,515 32, , , , ,999 The notes on pages 99 to 326 are an integral part of these financial statements.

101 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 099 Syarikat Malaysia Berhad is a public limited liability company, incorporated and domiciled in Malaysia and is listed on the Main Market of the Bursa Malaysia Securities Berhad. The address of the principal place of business and registered office of the Company is as follows: 26 th Floor, Annex Block Menara Malaysia No. 4, Jalan Sultan Sulaiman Kuala Lumpur The consolidated financial statements of the Company as at and for the financial year ended 31 December 2012 comprise the Company and its subsidiaries (together referred to as the Group ) and the Group s interest in associates. The financial statements of the Company as at and for the financial year ended 31 December 2012 do not include other entities. The Company is principally engaged in managing family and general takaful businesses, whilst the principal activities of the subsidiaries are as stated in Note 5 to the financial statements. There has been no significant change in the nature of these activities during the financial year. The immediate holding company during the financial year is BIMB Holdings Berhad, a company incorporated in Malaysia and listed on the Main Market of the Bursa Malaysia Securities Berhad. The ultimate holding corporation of the Company during the financial year is Lembaga Tabung Haji, a statutory body established under the Tabung Haji Act 1995 (Act 535). The financial statements were authorised for issue by the Board of Directors on 15 March Basis of preparation (a) Statement of compliance The financial statements of the Group and the Company have been prepared in accordance with Malaysian Financial Reporting Standards (MFRS), International Financial Reporting Standards and the Companies Act, 1965, the Act, 1984, Guidelines/ Circulars issued by Bank Negara Malaysia (BNM) and Shariah rulings and precepts. These are the Group s and the Company s first financial statements prepared in accordance with MFRS and MFRS 1, First-time Adoption of Malaysian Financial Reporting Standards has been applied. In the previous years, the financial statements of the Group and the Company were prepared in accordance with Financial Reporting Standards (FRS). Separate financial statements for the respective funds were prepared in accordance with BNM guidelines on financial reporting, where a Operator was required to report on the assets and liabilities of the funds separately from the assets and liabilities of its own. Following the adoption of MFRS, a Operator is required to present consolidated financial statements for itself and the funds it manages and controls in accordance with the requirements of MFRS 127, Consolidated and Separate Financial Statements. The statements of financial position and the statements of profit or loss and other comprehensive income of the Operator, Family Fund and General Fund are supplementary financial information presented in accordance with the requirements of BNM and Act, 1984 in Malaysia to segregate assets, liabilities, income and expenses of funds from its own. The statements of financial position and profit or loss and other comprehensive income of the Operator include only assets, liabilities, income and expenses of the Operator, excluding the funds managed by it. The statements of financial position and profit or loss and other comprehensive income of the Family and General Fund include only the assets, liabilities, income and expenses of the family solidarity fund and General Fund that is set up, managed and controlled by the Operator.

102 100 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 1. Basis of preparation (continued) (a) Statement of compliance (continued) The financial impacts on transition to MFRS are disclosed in Note 41 to the financial statements. The Group and the Company have early adopted the amendments to MFRS 101, Presentation of Financial Statements which are effective for annual periods beginning on or after 1 July The early adoption of the amendments to MFRS 101 has no impact on the financial statements other than the presentation format of the statement of profit or loss and other comprehensive income. The following are accounting standards, amendments and interpretations that have been issued by the Malaysian Accounting Standards Board (MASB) but have not been adopted by the Group and the Company: MFRSs, Interpretations and Amendments effective for annual periods beginning on or after 1 January 2013 MFRS 10, Consolidated Financial Statements MFRS 11, Joint Arrangements MFRS 12, Disclosure of Interests in Other Entities MFRS 13, Fair Value Measurement MFRS 119, Employee Benefits (2011) MFRS 127, Consolidated and Separate Financial Statements (2011) MFRS 128, Investments in Associates and Joint Ventures (2011) IC Interpretation 20, Stripping Costs in the Production Phase of a Surface Mine Amendments to MFRS 7, Financial Instruments: Disclosures Offsetting Financial Assets and Financial Liabilities Amendments to MFRS 1, First-time Adoption of Malaysian Financial Reporting Standards Government Loans Amendments to MFRS 1, First-time Adoption of Malaysian Financial Reporting Standards (Annual Improvements Cycle) Amendments to MFRS 101, Presentation of Financial Statements (Annual Improvements Cycle) Amendments to MFRS 116, Property, Plant and Equipment (Annual Improvements Cycle) Amendments to MFRS 132, Financial Instruments: Presentation (Annual Improvements Cycle) Amendments to MFRS 134, Interim Financial Reporting (Annual Improvements Cycle) Amendments to MFRS 10, Consolidated Financial Statements: Transition Guidance Amendments to MFRS 11, Joint Arrangements: Transition Guidance Amendments to MFRS 12, Disclosure of Interests in Other Entities: Transition Guidance MFRSs, Interpretations and Amendments effective for annual periods beginning on or after 1 January 2014 Amendments to MFRS 10, Consolidated Financial Statements: Investment Entities Amendments to MFRS 12, Disclosure of Interests in Other Entities: Investment Entities Amendments to MFRS 127, Separate Financial Statements (2011): Investment Entities Amendments to MFRS 132, Financial Instruments: Presentation Offsetting Financial Assets and Financial Liabilities MFRSs, Interpretations and Amendments effective for annual periods beginning on or after 1 January 2015 MFRS 9, Financial Instruments (2009) MFRS 9, Financial Instruments (2010) Amendments to MFRS 7, Financial Instruments: Disclosures Mandatory Date of MFRS 9 and Transition Disclosures The Group and the Company plan to apply the abovementioned standards, amendments and interpretations: from the annual period beginning on 1 January 2013 for those standards, amendments or interpretations that are effective for annual periods beginning on or after 1 January 2013, except for MFRS 11, IC Interpretation 20, Amendments to MFRS 1 and Amendments to MFRS 11 which are not applicable to the Group and the Company.

103 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Basis of preparation (continued) (a) Statement of compliance (continued) The Group and the Company plan to apply the abovementioned standards, amendments and interpretations (continued): from the annual period beginning on 1 January 2014 for those standards, amendments or interpretations that are effective for annual periods beginning on or after 1 January from the annual period beginning on 1 January 2015 for those standards, amendments or interpretations that are effective for annual periods beginning on or after 1 January Material impacts of initial application of a standard, an amendment or an interpretation, which will be applied retrospectively are discussed below: MFRS 9, Financial instruments MFRS 9 replaces the guidance in MFRS 139, Financial Instruments: Recognition and Measurement on the classification and measurement of financial assets and financial liabilities. The adoption of MFRS 9 may result in a change in accounting policy for financial assets. The Group is currently assessing the financial impact that may arise from the adoption of MFRS 9. MFRS 10, Consolidated Financial Statements MFRS 10, Consolidated Financial Statements introduces a new single control model to determine which investees should be consolidated. MFRS 10 supersedes MFRS 127, Consolidated and Separate Financial Statements and IC Interpretation 112, Consolidation Special Purpose Entities. There are three elements to the definition of control in MFRS 10: (i) power by investor over an investee, (ii) exposure, or rights, to variable returns from investor s involvement with the investee, and (iii) investor s ability to affect those returns through its power over the investee. (b) Basis of measurement The financial statements have been prepared on the historical cost basis other than as disclosed in the Note 2. (c) Functional and presentation currency These financial statements are presented in Ringgit Malaysia (RM), which is the Company s functional currency. All financial information is presented in RM and has been rounded to the nearest thousand, unless otherwise stated. (d) Use of estimates and judgements The preparation of financial statements in conformity with MFRS which requires management to make judgements, estimates and assumptions that affect the application of accounting policies and the reported amount of assets, liabilities, income and expenses. Actual result may differ from these estimates. Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimates are revised and in any future periods affected.

104 102 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 1. Basis of preparation (continued) (d) Use of estimates and judgements (continued) There are no significant areas of estimation uncertainty and critical judgements in applying accounting policies that have significant effect on the amounts recognised in the financial statements other than those disclosed in the following notes: Note 2(f) and Note 4 Investment properties Note 2(c) and Note 37 Financial instruments Note 2 (n), (o) and Note 18 - Computation of expense reserves Note 2(m), (n) Note 8 and Note 17 Provision for outstanding claims including IBNR claims, Family Funds and actuarial reserves 2. Summary of significant accounting policies The accounting policies set out below have been applied consistently to the periods presented in these financial statements and in preparing the opening MFRS statements of financial position of the Group and of the Company at 1 January 2011 (the transition date to MFRS framework), unless otherwise stated. (a) Basis of consolidation (i) Subsidiaries Subsidiaries are entities, including unincorporated entities, controlled by the Company. The financial statements of subsidiaries are included in the consolidated financial statements from the date that control commences until the date that control ceases. Control exists when the Company has the ability to exercise its power to govern the financial and operating policies of an entity so as to obtain benefits from its activities. In assessing control, potential voting rights that presently are exercisable are taken into account. Investments in subsidiaries are measured in the Company s statement of financial position at cost less any impairment losses, unless the investment is classified as held for sale or distribution. The cost of investments includes transaction costs. (ii) Business combinations Business combinations are accounted for using the acquisition method from the acquisition date, which is the date on which control is transferred to the Group.

105 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Summary of significant accounting policies (continued) (a) Basis of consolidation (continued) (ii) Business combinations (continued) The Group measures the cost of goodwill at the acquisition date as: the fair value of the consideration transferred; plus the recognised amount of any non-controlling interests in the acquiree; plus if the business combination is achieved in stages, the fair value of the existing equity interest in the acquiree; less the net recognised amount (generally fair value) of the identifiable assets acquired and liabilities assumed. When the excess is negative, a bargain purchase gain is recognised immediately in profit or loss. For each business combination, the Group elects whether it measures the non-controlling interests in the acquiree either at fair value or at the proportionate share of the acquiree s identifiable net asset at the acquisition date. Transaction costs, other than those associated with the issue of Islamic debt or equity securities, that the Group incurs in connection with a business combination are expensed as incurred. (iii) Acquisition of non-controlling interests The Group treats all changes in its ownership interest in a subsidiary that do not result in a loss of control as equity transactions between the Group and its non-controlling interest holders. Any difference between the Group s share of net assets before and after the change, and any consideration received or paid, is adjusted to or against Group reserves. (iv) 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. (v) Associates Associates are entities, including unincorporated entities, in which the Group has significant influence, but not control, over the financial and operating policies.

106 104 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 2. Summary of significant accounting policies (continued) (a) Basis of consolidation (continued) (v) Associates (continued) Investments in associates are accounted for in the consolidated financial statements using the equity method less any impairment losses, unless it is classified as held for sale or distribution. The cost of the investment includes transaction costs. The consolidated financial statements include the Group s share of the profit or loss and other comprehensive income of the associate, after adjustments if any, to align the accounting policies with those of the Group, from the date that significant influence commences until the date that significant influence ceases. When the Group s share of losses exceeds its interest in an associate, the carrying amount of that interest including any long-term investments 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. When the Group ceases to have significant influence over an associate, it is accounted for as a disposal of the entire interest in that associate, with a resulting gain or loss being recognised in profit or loss. Any retained interest in the former associate at the date when significant influence is lost is re-measured at fair value and this amount is regarded as the initial carrying amount of a financial asset. When the Group s 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. Investments in associates are measured in the Company s statement of financial position at cost less any impairment losses, unless the investment is classified as held for sale or distribution. The cost of investments includes transaction costs. (vi) 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 is 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 doing so causes the non-controlling interests to have a deficit balance. (vii) Transactions eliminated on consolidation Intra-group balances and transactions, and any unrealised income and expenses arising from intra-group transactions, are eliminated in preparing the consolidated financial statements. Unrealised gains arising from transactions with associates are eliminated against the investment to the extent of the Group s interest in the associates. Unrealised losses are eliminated in the same way as unrealised gains, but only to the extent that there is no evidence of impairment.

107 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Summary of significant accounting policies (continued) (b) Foreign currency (i) Foreign currency transactions Transactions in foreign currencies are translated to the respective functional currencies of the Group entities at exchange rate at the dates of the transactions. Monetary assets and liabilities denominated in foreign currencies at the reporting date are retranslated to the functional currency at the exchange rate at that date. Non-monetary assets and liabilities denominated in foreign currencies are not retranslated at the reporting date, except for those that are measured at fair value are retranslated to the functional currency at the exchange rate at the date that the fair value was determined. Foreign currency differences arising on retranslation are recognised in profit or loss, except for differences arising on the retranslation of available-for-sale equity instruments, which are recognised in other comprehensive income. (ii) Operations denominated in functional currencies other than Ringgit Malaysia The assets and liabilities of operations denominated in functional currencies other than RM and fair value adjustments arising on acquisition, are translated to RM at exchange rates at the end of the reporting period. The income and expenses of foreign operations, are translated to RM at exchange rates at the dates of the transactions. Foreign currency differences are recognised in other comprehensive income and accumulated in the foreign currency translation reserve (FCTR) in equity. However, if the operation is a non-wholly-owned subsidiary, then the relevant proportionate share of the translation difference is allocated to the non-controlling interests. When a foreign operation is disposed of such that control, significant influence or joint control is lost, the cumulative amount in the FCTR related to that foreign operation is reclassified to profit or loss as part of the profit or loss on disposal. When the Group disposes of only part of its interest in a subsidiary that includes a foreign operation, the relevant proportion of the cumulative amount is reattributed to non-controlling interests. When the Group disposes of only part of its investment in an associate or joint venture that includes a foreign operation while retaining significant influence or joint control, the relevant proportion of the cumulative amount is reclassified to profit or loss. (c) Financial instruments (i) Initial recognition and measurement A financial asset or a financial liability is recognised in the statement of financial position when, and only when, the Group or the Company becomes a party to the contractual provisions of the instrument. A financial instrument is recognised initially, at its fair value plus, in the case of a financial instrument not at fair value through profit or loss, transaction costs that are directly attributable to the acquisition or issue of the financial instrument.

108 106 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 2. Summary of significant accounting policies (continued) (c) Financial instruments (continued) (i) Initial recognition and measurement (continued) An embedded derivative is recognised separately from the host contract and accounted for as a derivative if, and only if, it is not closely related to the economic characteristics and risks of the host contract and the host contract is not categorised at fair value through profit or loss. The host contract, in the event an embedded derivative is recognised separately, is accounted for in accordance with policy applicable to the nature of the host contract. (ii) Financial instrument categories and subsequent measurement The Group and the Company categorise financial instruments as follows: Financial assets (a) Financial assets at fair value through profit or loss Fair value through profit or loss category comprises financial assets that are held for trading, including derivatives (except for a derivative that is a financial guarantee contract or a designated and effective hedging instrument) or financial assets that are specifically designated into this category upon initial recognition. Derivatives that are linked to and must be settled by delivery of unquoted equity instruments whose fair values cannot be reliably measured are measured at cost. Other financial assets categorised as fair value through profit or loss are subsequently measured at their fair values with the gain or loss recognised in profit or loss. (b) Held-to-maturity investments Held-to-maturity investments category comprises Islamic debt instruments that are quoted in an active market and the Group or the Company has the positive intention and ability to hold them to maturity. Financial assets categorised as held-to-maturity investments are subsequently measured at amortised cost using the effective interest method. (c) Loans and receivables Loans and receivables category comprises Islamic debt instruments that are not quoted in an active market (including fixed deposits with financial institutions with maturities more than 3 months). Financial assets categorised as loans and receivables are subsequently measured at amortised cost using the effective interest method.

109 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Summary of significant accounting policies (continued) (c) Financial instruments (continued) (ii) Financial instrument categories and subsequent measurement (d) Available-for-sale financial assets Available-for-sale category comprises investment in equity and Islamic debt securities instruments that are not held for trading nor held to maturity. Investments in equity instruments that do not have a quoted market price in an active market and whose fair value cannot be reliably measured are measured at cost. Other financial assets categorised as available-for-sale are subsequently measured at their fair values with the gain or loss recognised in other comprehensive income, except for impairment losses, foreign exchange gains and losses arising from monetary items and gains and losses of hedged items attributable to hedge risks of fair value hedges which are recognised in profit or loss. On derecognition, the cumulative gain or loss recognised in other comprehensive income is reclassified from equity into profit or loss. Profit income calculated for an Islamic debt instrument using the effective interest method is recognised in profit or loss. (e) receivables receivables are recognised when due and measured on initial recognition at the fair value of the consideration received or receivable. Subsequent to initial recognition, takaful receivables are measured at amortised cost, using the effective interest method. If there is objective evidence that the takaful receivable is impaired, the Group and the Company reduce the carrying amount of the takaful receivable accordingly and recognises that impairment loss in profit or loss. The Group and the Company gather the objective evidence that a takaful receivable is impaired using the same process adopted for financial assets carried at amortised cost. The impairment loss is calculated under the same method used for those financial assets. These processes are described in Note 2(i). receivables are derecognised when the derecognition criteria for financial assets, as described in Note 2(c)(iv), have been met. All financial assets, except for those measured at fair value through profit or loss, are subject to review for impairment (see Note 2(i) (i) and (ii)). Financial liabilities All financial liabilities are initially measured at fair value and subsequently measured at amortised cost other than those categorised as fair value through profit or loss. Fair value through profit or loss category comprises financial liabilities that are derivatives (except for a derivative that is a financial guarantee contract or a designated and effective hedging instrument) or financial liabilities that are specifically designated into this category upon initial recognition. Derivatives that are linked to and must be settled by delivery of unquoted equity instruments whose fair values cannot be reliably measured at cost. Financial liabilities categorised as fair value through profit or loss are subsequently measured at their fair values with the gain or loss recognised in profit or loss.

110 108 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 2. Summary of significant accounting policies (continued) (c) Financial instruments (continued) (iii) Regular way purchase or sale of financial assets A regular way purchase or sale is a purchase or sale of a financial asset under a contract whose terms require delivery of the asset within the time frame established generally by regulation or convention in the marketplace concerned. A regular way purchase or sale of financial assets is recognised and derecognised, as applicable, using trade date accounting. Trade date accounting refers to: (a) the recognition of an asset to be received and the liability to pay for it on the trade date, and (b) derecognition of an asset that is sold, recognition of any gain or loss on disposal and the recognition of a receivable from the buyer for payment on the trade date. (iv) Derecognition 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 consideration received (including any new asset obtained less any new liability assumed) and any cumulative gain or loss that had been recognised in equity is recognised in the profit or loss. 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. (d) Property and equipment (i) Recognition and measurement The land and buildings are stated at cost/valuation less any accumulated depreciation and any accumulated impairment losses. Items of equipment are measured at cost less any accumulated depreciation and any accumulated impairment losses. The Group and the Company revalue their land and buildings annually and of shorter intervals whenever the fair value of the revalued assets is expected to differ materially from their carrying value. Addition subsequent to their revalution are stated in the financial statements at cost until the next revalution exercise. An external independent valuation company, having the appropriate recognised professional qualifications, values the Group s land and buildings on annual basis. The revalued amount are based on market value, being the estimated amount for which a property could be exchanged between a willing buyer and a willing seller in an arm s length transaction. Surpluses arising from revaluation are dealt with in the revaluation reserve account. Any deficit arising is offset against the revaluation reserve to the extent of a previous increase for the same property. In all other cases, a decrease in carrying amount is charged to the profit or loss.

111 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Summary of significant accounting policies (continued) (d) Property and equipment (continued) (i) Recognition and measurement (continued) Cost includes expenditures that are directly attributable to the acquisition of the asset and any other costs directly attributable to bringing the asset to working condition for its intended use, and the costs of dismantling and removing the items and restoring the site on which they are located. Purchased software that is integral to the functionality of the related equipment is capitalised as part of that equipment. When significant parts of an item of property and equipment have different useful lives, they are accounted for as separate items (major components) of property and equipment. The gain or loss on disposal of an item of property and equipment is determined by comparing the proceeds from disposal with the carrying amount of property and equipment and is recognised net within realised gains and losses in profit or loss. (ii) Subsequent costs The cost of replacing a component of an item of property and equipment is recognised in the carrying amount of the item if it is probable that the future economic benefits embodied within the component will flow to the Group or the Company, and its cost can be measured reliably. The carrying amount of the replaced component is derecognised to profit or loss. The costs of the day-to-day servicing of property and equipment are recognised in profit or loss as incurred. (iii) Depreciation Depreciation is based on the cost of an asset less its residual value. Significant components of individual assets are assessed, and if a component has a useful life that is different from the remainder of that asset, then that component is depreciated separately. Depreciation is recognised in profit or loss on a straight-line basis over the estimated useful lives of each component of an item of property and equipment. Leased assets are depreciated over the shorter of the lease term and their useful lives unless it is reasonably certain that the Group will obtain ownership by the end of the lease term. Freehold land is not depreciated. Property and equipment under construction are not depreciated until the assets are ready for their intended use. The annual depreciation rates for the current and comparative periods are as follows: Buildings 2.0% Renovation 16.7% Furniture, fixtures and fittings 16.7% % Motor vehicles 20.0% Computer and equipment 20.0% % The depreciable amount is determined after deducting the residual value. Depreciation methods, useful lives and residual values are reviewed at end of the reporting period, and adjusted as appropriate.

112 110 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 2. Summary of significant accounting policies (continued) (e) Leased assets (i) Finance lease Leases in terms of which the Group or the Company assume substantially all the risks and rewards of ownership are classified as finance leases. 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. Subsequent to initial recognition, the asset is accounted for in accordance with the accounting policy applicable to that asset. Minimum lease payments made under finance leases are apportioned between the finance expense and the reduction of the outstanding liability. The finance expense is allocated to each period during the lease term so as to produce a constant periodic rate of profit on the remaining balance of the liability. 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. Leasehold land which in substance is a finance lease is classified as property and equipment. (ii) Operating lease Leases, where the Group or the Company does not assume substantially all the risks and rewards of ownership are classified as operating leases and, except for property interest held under operating lease, the leased assets are not recognised on the Group s or the Company s statement of financial position. Property interest held under an operating lease, which is held to earn rental income or for capital appreciation or both, is classified as investment property and measured using fair value model. Payments made under operating leases are recognised in profit or loss on a straight-line basis over the term of the lease. Lease incentives received are recognised in profit or loss as an integral part of the total lease expense, over the term of the lease. Contingent rentals are charged to profit or loss in the reporting period in which they are incurred. Leasehold land which in substance is an operating lease is classified as prepaid lease payments. (f) Investment property (i) Investment property carried at fair value Investment properties are properties which are owned or held under a leasehold interest to earn rental income or for capital appreciation or for both, but not for sale in the ordinary course of business, use in the production or supply of services or for administrative purposes. Investment properties are measured initially at cost and subsequently at fair value with any change therein recognised in profit or loss for the period in which they arise. Cost includes expenditure that is directly attributable to the acquisition of the investment property. An investment property is derecognised on its disposal, or when it is permanently withdraw from use and no future economic benefit are expected from its disposal. The difference between the net disposal proceeds and the carrying amount is recognised in profit or loss in the period in which the item is derecognised.

113 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Summary of significant accounting policies (continued) (f) Investment property (continued) (ii) Reclassifications to/from investment property carried at fair value When an item of property and equipment is transferred to investment property following a change in its use, any difference arising at the date of transfer between the carrying amount of the item immediately prior to transfer and its fair value is recognised directly in equity as a revaluation of property and equipment. However, if a fair value gain reverses a previous impairment loss, the gain is recognised in profit or loss. Upon disposal of an investment property, any surplus previously recorded in equity is transferred to retained earnings; the transfer is not made through profit or loss. When the use of a property changes such that it is reclassified as property and equipment, its fair value at the date of reclassification becomes its cost for subsequent accounting. (iii) Determination of fair value An external, independent valuation firm, having appropriate recognised professional qualifications and recent experience in the location and category of property being valued, values the Group s and the Company s investment property portfolio annually. The fair values are based on market values, being the estimated amount for which a property could be exchanged on the date of the valuation between a willing buyer and a willing seller in an arm s length transaction after proper marketing wherein the parties had each acted knowledgeably. (g) Non-current assets held for sale Non-current assets, or disposal groups comprising assets and liabilities that are expected to be recovered primarily through sale rather than through continuing use, are classified as held for sale. Immediately before classification as held for sale, the assets, or components of a disposal group, are remeasured in accordance with the Group s accounting policies. Thereafter, generally the assets, or disposal group are measured at the lower of their carrying amount and fair value less costs to sell. Any impairment loss on a disposal group is first allocated to goodwill, and then to the remaining assets and liabilities on pro-rata basis, except that no loss is allocated to financial assets, deferred tax assets and investment property, which continue to be measured in accordance with the Group s accounting policies. Impairment losses on initial classification as held for sale and subsequent gains or losses on remeasurement are recognised in profit or loss. Gains are not recognised in excess of any cumulative impairment loss. Intangible assets and property and equipment once classified as held for sale are not amortised or depreciated. In addition, equity accounting of equity accounted investees ceases once classified as held for sale. (h) Cash and cash equivalents and placements with financial institutions Cash and cash equivalents consist of cash on hand, balances and deposits with banks and highly liquid investments which have an insignificant risk of changes in fair value with original maturities of three months or less, and are used by the Group and the Company in the management of their short term commitments. For the purpose of the statement of cash flows, cash and cash equivalents are presented net of bank overdrafts and pledged deposits.

114 112 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 2. Summary of significant accounting policies (continued) (i) Impairment (i) Financial assets, excluding takaful receivables All financial assets (except for financial assets categorised as fair value through profit or loss, investments in subsidiaries and investment in associates) are assessed at each reporting date whether there is any objective evidence of impairment as a result of one or more events having an impact on the estimated future cash flows of the asset. Losses expected as a result of future events, no matter how likely, are not recognised. For an investment in an equity instrument, a significant or prolonged decline in the fair value below its cost is an objective evidence of impairment. If any such objective evidence exists, then the financial asset s recoverable amount is estimated. An impairment loss in respect of loans and receivables (including takaful receivables where the policy is set out in Note 2(c)(ii)(e) above) and held-to-maturity investments is recognised in profit or loss and is measured as the difference between the asset s carrying amount and the present value of estimated future cash flows discounted at the asset s original effective profit rate. The carrying amount of the asset is reduced through the use of an allowance account. An impairment loss in respect of available-for-sale financial assets is recognised in profit or loss and is measured as the difference between the asset s acquisition cost (net of any principal repayment and amortisation) and the asset s current fair value, less any impairment loss previously recognised. Where a decline in the fair value of an available-for-sale financial asset has been recognised in other comprehensive income, the cumulative loss in other comprehensive income is reclassified from equity to profit or loss. An impairment loss in respect of unquoted equity instrument that is carried at cost is recognised in profit or loss and is measured as the difference between the financial asset s carrying amount and the present value of estimated future cash flows discounted at the current market rate of return for a similar financial asset. Impairment losses recognised in profit or loss for an investment in an equity instrument classified as available-for-sale is not reversed through the profit or loss. If, in a subsequent period, the fair value of an Islamic debt instrument increases and the increase can be objectively related to an event occurring after the impairment loss was recognised in profit or loss, the impairment loss is reversed, to the extent that the asset s carrying amount does not exceed what the carrying amount would have been had the impairment not been recognised at the date the impairment is reversed. The amount of the reversal is recognised in profit or loss. (ii) receivables receivables are recognised when due and measured on initial recognition at the fair value of the consideration received or receivable. Subsequent to initial recognition, takaful receivables are measured at amortised cost, using the effective interest method. If there is objective evidence that the takaful receivable is impaired, the Group and the Company reduce the carrying amount of the takaful receivable accordingly and recognises that impairment loss in profit or loss. The Group and the Company gather the objective evidence that a takaful receivable is impaired using the same process adopted for financial assets carried at amortised cost. The impairment loss is calculated under the same method used for those financial assets. These processes are described in Note 2(i)(i). receivables are derecognised when the derecognition criteria for financial assets, as described in Note 2(c)(iv), have been met.

115 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Summary of significant accounting policies (continued) (i) Impairment (continued) (iii) Other assets The carrying amounts of other assets (except for deferred tax asset and investment property measured at fair value and non-current assets classified as held for sale) are reviewed at the end of each reporting period to determine whether there is any indication of impairment. If any such indication exists, then the asset s recoverable amount is estimated. For the purpose of impairment testing, assets are grouped together into the smallest group of assets that generates cash inflows from continuing use that are largely independent of the cash inflows of other assets or cash-generating units. Subjects to an operating segment ceiling test, for the purpose of goodwill impairment testing, cash-generating units to which goodwill has been allocated are aggregated so that the level at which impairment testing is performed reflects the lowest level at which goodwill is monitored for internal reporting purposes. The goodwill acquired in a business combination, for the purpose of impairment testing, is allocated to group of cash-generating units that are expected to benefit from the synergies of the combination. The recoverable amount of an asset or cash-generating unit is the greater of its value in use and its fair value less costs to sell. 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 or cash-generating unit. An impairment loss is recognised if the carrying amount of an asset or its related cash-generating unit exceeds its estimated recoverable amount. Impairment losses are recognised in profit or loss. Impairment losses recognised in respect of cash-generating units are allocated to reduce the carrying amount of the other assets in the cash-generating unit (groups of cash-generating units) on a pro-rata basis. Impairment losses recognised in prior periods are assessed at the end of each reporting period for any indications that the loss has decreased or no longer exists. An impairment loss is reversed if there has been a change in the estimates used to determine the recoverable amount since the last impairment loss was recognised. An impairment loss is reversed only to the extent that the asset s carrying amount does not exceed the carrying amount that would have been determined, net of depreciation or amortisation, if no impairment loss had been recognised. Reversals of impairment losses are credited to profit or loss in the year in which the reversals are recognised.

116 114 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 2. Summary of significant accounting policies (continued) (j) Equity intruments Instruments classified as equity are measured at cost on initial recognition and are not remeasured subsequently. (i) Ordinary Shares Ordinary shares are classified as equity. (k) Employee benefits (i) Short-term employee benefits Short-term employee benefit obligations in respect of salaries, annual bonuses, paid annual leave and sick leave are measured on an undiscounted basis and are expensed as the related service is provided. A liability is recognised for the amount expected to be paid under short-term cash bonus or profit-sharing plans if the Group and the Company has a present legal or constructive obligation to pay this amount as a result of past service provided by the employee and the obligation can be estimated reliably. (ii) State plans The Group s and the Company s contribution to the statutory pension fund is charged to profit or loss in the financial year to which they relate. Once the contributions have been paid, the Group and the Company have no further payment obligations. (l) Provisions A provision is recognised if, as a result of a past event, the Group and the Company have a present legal or constructive obligation that can be estimated reliably, and it is probable that an outflow of economic benefits will be required to settle the obligation. Provisions are determined by discounting the expected future cash flows at a pre-tax rate that reflects current market assessments of the time value of money and the risks specific to the liability. The unwinding of the discount is recognised as finance cost. (m) General Fund The General Fund is maintained in accordance with the (Amendment) Act, Included in General Fund is fund arising from: General ; and General retakaful funds. The General underwriting results are determined for each class of takaful business after taking into account retakaful, unearned contributions, claims incurred and administrative fees. Contribution income Contributions are recognised in a financial period in respect of risks assumed during that particular financial period based on the inception date. Inward treaty retakaful contributions are recognised on the basis of periodic advices received from ceding takaful operators.

117 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Summary of significant accounting policies (continued) (m) General Fund (continued) Unearned contribution reserves The Unearned Contribution Reserves (UCR) represent the portion of the net contributions of takaful certificates written that relate to the unexpired periods of the certificates at the end of the financial year. In determining the UCR at the end of the reporting period, the method that most accurately reflects the actual unearned contributions is used, as follows: a) 1/365th method for all General business. b) 1/8th method for all classes of General Treaty Inward Retakaful business. Provision for outstanding claims A liability for outstanding claims is recognised in respect of direct takaful business. The amount of outstanding claims is the best estimate of the expenditure required together with related expenses less recoveries, if any, to settle the present obligation at the end of the reporting period. Any difference between the current estimated cost and subsequent settlement is dealt with in the takaful statement of comprehensive income of the Group and of the Company in the year in which the settlement takes place. Provision is also made for the cost of claims (together with related expenses) and Incurred But Not Reported Claims (IBNR) at the end of the reporting period, using a mathematical method of estimation by a qualified external actuary where historical claims experience are used to project future claims. The provision includes a risk margin for adverse deviation. As with all projections, there are elements of uncertainty and the projected claims may be different from actual. These uncertainties arise from changes in underlying risk, changes in spread of risks, claims settlement pattern as well as uncertainties in the projection model and underlying assumptions. The application of the guidelines on valuation basis for liabilities of General Business do not have material financial impact to the current and prior periods financial statements of the Group and of the Company and has been accounted for prospectively. (n) Family Fund Included in Family Fund is fund arising from: Family ; Group Family ; and Family retakaful funds.

118 116 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 2. Summary of significant accounting policies (continued) (n) Family Fund (continued) The Family Fund is maintained in accordance with the requirements of the (Amendment) Act, 1984 and includes the amounts attributable to participants which represents the participants share of the underwriting surplus and return on the investments, where applicable and are distributable in accordance with the terms and conditions prescribed by the Group and the Company. The surplus transfer from the Family Fund to the profit or loss is based on the predetermined profit sharing ratio of the underwriting surplus and return on investments. Contribution income Contribution is recognised as soon as the amount of the contribution can be reliably measured. Initial contribution is recognised from inception date and subsequent contribution is recognised when it is due. For individual family takaful contribution, recognition is up to the extent of one due amount. At the end of each financial period, all due contributions are accounted for to the extent that they can be reliably measured. Investment-linked business Investments of the investment-linked business are stated at closing market prices. Any increase or decrease in value of these investments is taken into the investment-linked business revenue accounts. Actuarial reserves Arising from the adoption of guidelines on valuation basis for liabilities of Family Business (issued by Bank Negara Malaysia), with effect from 1 January 2012, actuarial reserves comprise the Prospective Actuarial Valuation, Cash Flow Projection Valuation and Unearned Contribution Valuation as explained below: (i) Prospective Actuarial Valuation For credit-related products, the liabilities of Family Fund shall be valued based on the sum of present value of future benefits and any expected future expenses payable from the takaful funds, less the present value of future gross tabarru arising from the certificate, discounted at the appropriate risk discount rate as defined in the valuation guidelines. For a credit-related takaful certificate whose sustainability of tabarru deductions is depended on the performance of Participants Investment Fund (PIF), the calculation is subject to adjusting the future gross tabarru cash flow such that it is limited to the period where the PIF can sustain the tabarru and assuming that the takaful coverage is in force for the full duration of the takaful contract.

119 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Summary of significant accounting policies (continued) (n) Family Fund (continued) (ii) Cash Flow Projection Valuation For products with PIF other than credit-related products, the liabilities shall be valued by projecting future cash flows to ensure that all future obligations can be met without recourse to additional finance or capital support at any future time during the duration of the certificate. The cash flow projection shall use a basis that is consistent with the requirements of the valuation guidelines. (iii) Unearned Contribution Valuation For yearly renewable products or extensions shall be valued according to the following: (a) For a certificate covering death or survival, the liabilities shall be valued on an unexpired risk basis using a prospective estimate of expected future payments arising from future events covered as at the valuation date. These future payments shall include allowance for direct claims related expenses, direct investment-related expenses, cost of retakaful and expected future contribution refunds expected during the unexpired period. (b) For a certificate covering contingencies other than death or survival, the net liability is the maximum of unexpired risk reserve or unearned contribution reserve. Before 1 January 2012, actuarial reserves comprise the unearned contribution reserves and the reserve computed under the net contribution valuation as explained below: (i) Unearned contribution reserve The Unearned Contribution Reserve (UCR) of group family fund (except for Mortgage Reducing Term (MRTT) as detailed below) and family retakaful fund represents the portion of the net contributions of takaful certificates written that relate to the unexpired periods of the certificates at the end of the financial year. In determining the UCR at the end of the reporting period, the method that most accurately reflects the actual unearned contributions is used, as follows: a) 1/365th method for all group family takaful business. b) A pro-rata basis based on a time apportionment method for family retakaful business. (ii) Net contribution valuation The actuarial liabilities for MRTT products managed under group family fund and Ordinary Participants Special Account (PSA) are calculated using the net contribution method of valuation (NCV). The liability is ascertained by deducting the present value of future net contribution from the present value of the future amount-at-risk. As with all projections, there are elements of uncertainty and the projected liability may be different from actual. These uncertainties arise from changes in underlying risks, changes in spread of risks, claims settlement pattern as well as uncertainties in the projection model and underlying assumptions.

120 118 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 2. Summary of significant accounting policies (continued) (n) Family Fund (continued) Provision for outstanding claims Claims and provisions for claims arising on family and group family takaful certificates, including settlement costs, are accounted for using the case basis method and for this purpose, the benefits payable under a family takaful certificate are recognised as follows: a) Maturity or other policy benefit payments due on specified dates are accounted for as claims payable on the due dates. b) Death, surrender and other benefits without due dates are treated as claims payable on the date of receipts of intimation of death of the participant or occurrence of contingency covered. c) For individual family, group health and medical business, provision is made for the cost of claims (together with related expenses) and IBNR at the end of the reporting period, using a mathematical method of estimation by a qualified internal actuary where historical claims experience are used to project future claims. The provision includes a risk margin for adverse deviation. As with all projections, there are elements of uncertainty and the projected claims may be different from actual. These uncertainties arise from changes in underlying risk, changes in spread of risks, claim settlement pattern as well as uncertainties in the projection model and underlying assumptions. The application of the guidelines on valuation basis for liabilities of Family Business do not have material financial impact to the current and prior periods financial statements of the Group and of the Company and has been accounted for prospetively. (o) Expenses reserves The expense reserves is reported as a liability in Operator s Fund. (i) General Fund Arising from the adoption of guidelines on valuation basis for liabilities of General Business (issued by Bank Negara Malaysia), with effect from 1 January 2012, the expense reserve for mudharabah certificates is calculated based on best estimate of the provision for unexpired expense risk (UER) and the PRAD. The expense reserve for wakalah certificates refers to the higher of aggregate of the Unearned Wakalah Fee (UWF) for all lines of business or best estimate of the provision for UER and the PRAD at total fund level. (ii) Family Fund Arising from the adoption of guidelines on valuation basis for liabilities of Family Business (issued by Bank Negara Malaysia), with effect from 1 January 2012, expense reserves consists the followings: (a) Expense liabilities The method used to value expense liabilities shall be consistent with the method used to value takaful liabilities of the corresponding family takaful certificate (for example, for a long-term ordinary takaful certificate, the valuation method for expense liabilities should also be long-term in nature).

121 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Summary of significant accounting policies (continued) (o) Expenses reserves (continued) (b) Deficiency Reserve for Skim Anuiti KWSP In addition to the expense liabilities above, an additional requirement is also complied as stipulated below: If PIF is expected to be insufficient to meet future annuity certain benefit and/or future life annuity tabarru, another provision shall be set aside that is in line with requirement of the valuation guideline. Upon PIF insufficiency, the Operator s Fund shall honour the annuity certain benefit payment to participants as well as the tabarru to PRF. Before 1 January 2012, expense reserves consists the followings: (a) Investment-linked products Provision is made to recognise future expected losses to the Operator s Fund, if any, arising from servicing of individual certificate contracts with participants. Provision is estimated based on the methodology stated in the Guidelines on Investment Linked Insurance/ Business (BNM/ RH/GL ) issued by Bank Negara Malaysia where best estimated cash flows are discounted to ensure that there are no negative net cash flows arising in the future in the Operator s Fund. The best estimate assumptions used are consistent with that used in the valuation of the Investment Linked Risk Fund. (b) Single Contribution Wakalah Plans (Mortgage and Group Credit Wakalah) Provision is estimated based on actuarial present value of future maintenance expense. The assumptions used in calculating the provision are best estimate assumptions. The application of the guidelines on valuation basis for liabilities of General and Family Business do not have material financial impact to the current and prior periods financial statements of the Group and of the Company and has been accounted for prospectively. (p) Product classification The Family Fund and General Fund consist of certificate contracts that transfer takaful risk. contracts are those contracts that transfer significant takaful risk. A takaful contract is a contract under which the fund has accepted significant takaful risk from another party (the certificate holders) by agreeing to compensate the participants if a specified uncertain future event (the takaful event) adversely affects the participants. As a general guideline, to determine whether a contract has significant takaful risk, benefits paid are compared with benefits payable if the takaful event did not occur. Investment contracts are those contracts that do not transfer significant insurance risk. There are no contracts that are classified as investment contracts in the Family and General Funds. Once a contract has been classified as a takaful contract, it remains a takaful contract for the remainder of its life-time, even if the takaful risk reduces significantly during this period, unless all rights and obligations are extinguished or expired.

122 120 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 2. Summary of significant accounting policies (continued) (p) Product classification (continued) contracts in the current portfolio are classified as being without discretionary participation features (DPF) as it does not satisfy the criteria for DPF. DPF is a contractual right to receive, as a supplement to guaranteed benefits, additional benefits that are: likely to be a significant portion of the total contractual benefits; whose amount or timing is contractually at the discretion of the issuer; and that are contractually based on the: - performance of a specified pool of contracts or a specified type of contract; - realised and/or unrealised investment returns on a specified pool of assets held by the issuer; - the profit or loss of the company, fund or other entity that issues the contract. (q) Retakaful The fund cedes takaful risk in the normal course of business. Retakaful assets represent balances receivable and recoverable from retakaful operators. Amounts recoverable from retakaful operators are estimated in a manner consistent with the outstanding claims provision or settled claims associated with the retakaful s certificates and are in accordance with the related retakaful contracts. Ceded retakaful arrangements do not relieve the fund from its obligations to participants. Contributions and claims are presented on a gross basis for both ceded and assumed retakaful. Retakaful assets are reviewed for impairment at each reporting date or more frequently when an indication of impairment arises during the reporting period. Impairment occurs when there is objective evidence as a result of an event that occurred after initial recognition of the retakaful asset that the Family and General Fund may not receive all outstanding amounts due under the terms of the contract and the event has a reliably measurable impact on the amounts that the Family and General Fund will receive from the retakaful operator. The impairment loss is recorded in profit or loss. Gains or losses on buying retakaful, if any, are recognised in profit or loss immediately at the date of purchase and are not amortised. The fund also assumes retakaful risk in the normal course of business for Family and General contracts when applicable. Contributions and claims on assumed retakaful are recognised as revenue or expenses in the same manner as they would be if the retakaful were considered direct business, taking into account the product classification of the retakaful business. Retakaful liabilities represent balances due to retakaful operators. Amounts payable are estimated in a manner consistent with the related retakaful contract. Retakaful assets or liabilities are derecognised when the contractual rights are extinguished or expired or when the contract is transferred to another party. Retakaful contracts that do not transfer significant takaful risk are accounted for directly through the statement of financial position. These are deposit assets or financial liabilities that are recognised based on the consideration paid or received less any explicit identified contributions or fees to be retained by the retakaful operators. Investment income on these contracts is accounted for using the effective yield method when accrued.

123 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Summary of significant accounting policies (continued) (r) Other revenue recognition (i) Financing income Income from financing are recognised on an accrual basis, except where financing is considered impaired, i.e. where repayments are in arrears for more than 90 days, in which case recognition of such income is suspended. Subsequent to suspension, income is recognised on the receipt basis until all arrears have been paid. Income is recognised on a time proportion basis that takes into account the effective yield of the asset. (ii) Wakalah fees Wakalah fees are recognised as income or expenses by the respective funds based on a predetermined percentage of gross contributions upon inception of certificates. Wakalah surplus/(deficit) is arrived at after deducting commission and management expenses against the Wakalah fees charged. (iii) Rental income Rental is recognised on an accrual basis except where default in payment of rent has already occurred and rent dues remain outstanding for over 90 days, in which case recognition of rental income is suspended. Subsequent to suspension, income is recognised on the receipt basis until all arrears have been paid. (iv) Dividend income Dividend income is recognised in profit or loss on the date that the Group s or the Company s right to receive payment is established, which in the case of quoted securities is the ex-dividend date. (s) Zakat This represents tithes payable by the Group and the Company to comply with the Principles of Shariah and as approved by the Shariah Advisory Body. (t) Income tax expense Income tax expense comprises current and deferred tax. Current tax and deferred tax are recognised in profit or loss except to the extent that it relates to items recognised directly in equity or other comprehensive income. Current tax is the expected tax payable or receivable on the taxable income 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. 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 initial recognition of assets or 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.

124 122 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 2. Summary of significant accounting policies (continued) (t) Income tax expense (continued) 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 temporary difference can be utilised. Deferred tax assets are reviewed at the end of each reporting date and are reduced to the extent that it is no longer probable that the related tax benefit will be realised. (u) Operating lease payments The Group recognises its Ijarah financing obligations as operating leases. Lease payments under the operating lease are recognised as an expense in the profit or loss on a straight-line basis over the lease term. (v) Earnings per share The Group presents basic earnings per share (EPS) data for its ordinary shares. Basic EPS is calculated by dividing the consolidated 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. No diluted EPS is disclosed in these financial statements as there are no dilutive potential ordinary shares. (w) Operating segments An operating segment is a component of the Group that engages in business activities from which it may earn revenues and incur expenses, including revenues and expenses that relate to transactions with any of the Group s other components. All operating segments operating results are reviewed regularly by the chief operating decision maker, which in this case is the Chief Executive Officer of the Group, to make decisions about resources to be allocated to the segment and to assess its performance, and for which discrete financial information is available.

125 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Property and equipment Group Operator Office equipment, Renovation furniture, Freehold Leasehold and building Motor fixtures and Land Buildings Land Buildings in progress vehicles fittings Total Cost/Valuation Note At 1 January ,598 2,840 3,634 4, ,645 94, ,560 Additions ,811 13,155 Disposals (323) (95) (418) Write offs (1,468) (1,468) Transfer to investment properties - offset of accumulated depreciation - (720) (301) (121) (1,142) - transfer of carrying amount 4 (1,660) (1,781) (855) (339) (4,635) Transfers (222) Revaluation (44) (33) (77) Effect of movement in exchange rates At 31 December 2011/ 1 January ,499 4,733-1, , ,174 Additions ,699 7,474 Disposals (258) (218) (476) Write offs (2,183) (2,183) Revaluation , ,634 Effect of movement in exchange rates - - (796) (475) - (76) (940) (2,287) At 31 December ,854 4,691-1, , ,336

126 124 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 3. Property and equipment (continued) Group Operator Office equipment, Renovation furniture, Freehold Leasehold and building Motor fixtures and Accumulated depreciation Land Buildings Land Buildings in progress vehicles fittings Total and impairment loss Note At 1 January , ,062 76,204 80,049 Charge for the year ,219 10,601 Disposals (221) (88) (309) Write offs (1,432) (1,432) Offset of accumulated depreciation on property transferred to investment properties - (720) (301) (121) (1,142) Adjustment for revaluation - (17) (17) Effect of movement in exchange rates At 31 December 2011/ 1 January , ,011 87,879 Charge for the year ,430 11,308 Impairment loss Disposals (227) (206) (433) Write offs (2,137) (2,137) Adjustment for revaluation - (6) (1,207) (1,027) (2,240) Effect of movement in exchange rates (107) - (45) (838) (990) At 31 December 2012 Accumulated depreciation ,260 93,387 Accumulated impairment loss Carrying amounts ,260 93,584 At 1 January ,598 2,120 2,552 3, ,471 30,511 At 31 December 2011/ 1 January ,593 3, ,262 28,295 At 31 December ,854 4,219-1,058 17,371 29,752

127 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Property and equipment (continued) Group Office equipment, Renovation furniture, Freehold Leasehold and building Motor fixtures and Land Buildings Land Buildings in progress vehicles fittings Total Cost/Valuation Note At 1 January , ,991 3,634 35, ,645 94, ,239 Additions ,811 13,155 Disposals (323) (95) (418) Write offs (1,468) (1,468) Transfer to investment properties - offset of accumulated depreciation - (720) (301) (121) (1,142) - transfer of carrying amount 4 (1,660) (1,781) (855) (339) (4,635) Transfers (222) Revaluation 2,069 5, ,739 Effect of movement in exchange rates At 31 December 2011/ 1 January , ,238 2,499 36,270-1, , ,739 Additions ,699 7,474 Disposals (258) (218) (476) Write offs (2,183) (2,183) Revaluation ,151 2, ,867 Effect of movement in exchange rates (14) (12) (796) (1,144) - (76) (940) (2,982) At 31 December , ,121 5,854 37,651-1, , ,439

128 126 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 3. Property and equipment (continued) Group Office equipment, Renovation furniture, Freehold Leasehold and building Motor fixtures and Accumulated depreciation Land Buildings Land Buildings in progress vehicles fittings Total and impairment loss Note At 1 January , ,062 76,204 80,049 Charge for the year 28-2, , ,219 14,260 Impairment loss Disposals (221) (88) (309) Write offs (1,432) (1,432) Offset of accumulated depreciation on property transferred to investment properties - (720) (301) (121) (1,142) Adjustment for revaluation - (2,500) - (1,176) (3,676) Effect of movement in exchange rates At 31 December 2011/ 1 January 2012 Accumulated depreciation , ,011 87,879 Accumulated impairment loss , ,011 88,019 Charge for the year 28-2, , ,430 15,161 Impairment loss Disposals (227) (206) (433) Write offs (2,137) (2,137) Adjustment for revaluation - (2,604) (1,207) (2,282) (6,093) Effect of movement in exchange rates (107) - (45) (838) (990) At 31 December 2012 Accumulated depreciation ,260 93,387 Accumulated impairment loss Carrying amounts , ,260 94,375 At 1 January , ,271 2,552 34, , ,190 At 31 December 2011/ 1 January , ,221 1,593 35, , ,720 At 31 December , ,082 5,854 36,488-1,058 17, ,064

129 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Property and equipment (continued) Company Operator Office equipment, Renovation furniture, Freehold Leasehold and building Motor fixtures and Land Buildings Land Buildings in progress vehicles fittings Total Cost/Valuation Note At 1 January ,598 2,840 1, ,474 91,367 Additions ,992 11,992 Disposals (95) (86) (181) Write offs (1,468) (1,468) Transfer to investment properties - offset of accumulated depreciation - (720) (301) (121) (1,142) - transfer of carrying amount 4 (1,660) (1,781) (855) (339) (4,635) Transfers (222) Revaluation (44) (33) (77) At 1 January ,134 95,856 Additions ,320 6,887 Disposals (192) (214) (406) Write offs (2,183) (2,183) Revaluation At 31 December , ,204

130 128 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 3. Property and equipment (continued) Company Operator Office equipment, Renovation furniture, Freehold Leasehold and building Motor fixtures and Land Buildings Land Buildings in progress vehicles fittings Total Accumulated depreciation Note At 1 January ,582 68,111 Charge for the year ,320 9,419 Disposals (81) (84) (165) Write offs (1,432) (1,432) Offset of accumulated depreciation on property transferred to investment properties - (720) (301) (121) (1,142) Adjustment for revaluation - (17) (17) At 1 January ,386 74,774 Charge for the year ,805 9,934 Disposals (192) (205) (397) Write offs (2,137) (2,137) Adjustment for revaluation - (6) (6) At 31 December ,849 82,168 Carrying amounts At 1 January ,598 2, ,892 23,256 At 31 December 2011/ 1 January ,748 21,082 At 31 December ,208 18,036

131 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Property and equipment (continued) Company Office equipment, Renovation furniture, Freehold Leasehold and building Motor fixtures and Land Buildings Land Buildings in progress vehicles fittings Total Cost/Valuation Note At 1 January , ,836 9,794 14, , ,077 Additions ,992 11,992 Disposals (95) (86) (181) Write offs (1,468) (1,468) Transfer to investment properties - offset of accumulated depreciation - (720) (301) (121) (1,142) - transfer of carrying amount 4 (1,660) (1,781) (855) (339) (4,635) Transfers (222) Revaluation 2,045 5, ,717 At 1 January , ,085 9,194 14, , ,360 Additions ,320 6,887 Disposals (192) (214) (406) Write offs (2,183) (2,183) Revaluation ,523 At 31 December , ,983 10,055 15, , ,181

132 130 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 3. Property and equipment (continued) Company Office equipment, Renovation furniture, Freehold Leasehold and building Motor fixtures and Accumulated depreciation Land Buildings Land Buildings in progress vehicles fittings Total and impairment loss Note At 1 January ,582 68,111 Charge for the year 28-2, ,320 12,382 Impairment loss Disposals (81) (84) (165) Write offs (1,432) (1,432) Offset of accumulated depreciation on property transferred to investment properties - (720) (301) (121) (1,142) Adjustment for revaluation - (2,497) (152) (331) (2,980) At 31 December 2011/ 1 January 2012 Accumulated depreciation ,386 74,774 Accumulated impairment loss ,386 74,903 Charge for the year 28-2, ,805 13,059 Impairment loss Disposals (192) (205) (397) Write offs (2,137) (2,137) Adjustment for revaluation - (2,601) (166) (364) (3,131) At 31 December 2012 Accumulated depreciation ,849 82,168 Accumulated impairment loss Carrying amounts ,849 82,776 At 1 January , ,116 9,494 14, , ,966 At 31 December 2011/ 1 January , ,079 9,151 14, , ,457 At 31 December , ,955 9,941 14, , ,405

133 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Property and equipment (continued) 3.1 Revaluation of properties All the Group s and Company s land and buildings were revalued in December 2012 by independent professional qualified valuers using the comparison method. Had the land and buildings of the Group and of the Company been carried at historical cost less accumulated depreciation, their carrying amounts would have been as follows: Group Operator Group Freehold land ,147 43,877 43,892 45,551 Freehold buildings ,957 96,898 99, ,346 Leasehold land and buildings 4,574 5,319 6,517 26,430 27,940 29,702 5,203 5,965 10, , , , Company Operator Company Freehold land ,147 43,705 43,705 45,365 Freehold buildings ,957 96,820 99, ,257 Leasehold land and buildings - - 1,196 19,893 20,243 21, , , , ,411

134 132 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 3. Property and equipment (continued) 3.2 Leasehold land and buildings Included in the carrying amounts of the leasehold land and buildings are: Group Operator Group Leasehold land and buildings with unexpired lease period of - more than 50 years - - 1,196 17,279 15,795 17,466 - less than 50 years 10,073 5,319 5,321 25,063 20,964 19,597 10,073 5,319 6,517 42,342 36,759 37, Company Operator Company Leasehold land and buildings with unexpired lease period of - more than 50 years - - 1,196 17,279 15,795 17,466 - less than 50 years ,330 7,900 6, ,196 24,609 23,695 24,066

135 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Investment properties Group Note 2012 Operator Family General Group At 1 January 18,758 11, , ,980 26,620 29,234 46,572 47,493 - Additions , ,535 - Disposals (4,000) - (3,700) - (7,700) - Reclassified to assets held for sale 14 (1,340) - (1,360) (668) (540) - (3,240) (668) - Reclassified from property and equipment 3-4, ,635 - Transfers (17) (707) Fair value gains/(losses) for the year - net ,460 4,300 3,839 (306) 643 2,257 (2,734) - Impairment loss (26) (26) - - Effect of movement in exchange rates (86) (2) (703) (93) 11 At 31 December 18,194 18, , ,619 25,774 26,620 45,470 46,572 Comprising of: Freehold land and buildings 8,973 9, , ,944 14,464 14,430 17,499 19,159 Leasehold land and buildings more than 50 years 8,560 8,510 29,639 25,815 5,300 5,490 26,220 24,020 Leasehold land and buildings less than 50 years ,069 7,860 6,010 6,700 1,751 3,393 18,194 18, , ,619 25,774 26,620 45,470 46,572 The following are amounts arising from investment properties that have been recognised in profit or loss during the financial year. Note Operator Family General Group Rental Income ,821 10,067 1,032 1,144 4,901 6,140

136 134 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 4. Investment properties (continued) Company Note 2012 Operator Family General Company At 1 January 17,750 11, , ,172 26,620 29,234 45,430 46,361 - Additions , ,535 - Disposals (4,000) - (3,700) - (7,700) - Reclassified to assets held for sale 14 (1,340) - (1,360) (668) (540) - (3,240) (668) - Reclassified from property and equipment 3-4, ,635 - Fair value gains/(losses) for the year-net ,450 3,775 3,839 (306) 643 2,315 (2,733) - Impairment loss (26) (26) - At 31 December 17,250 17, , ,435 25,774 26,620 44,479 45,430 Comprising of: Freehold land and buildings 8,690 9, , ,200 14,464 14,430 17,499 18,190 Leasehold land and buildings more than 50 years 8,560 8,510 29,639 25,815 5,300 5,490 26,220 24,020 Leasehold land and buildings less than 50 years - - 2,080 4,420 6,010 6, ,220 17,250 17, , ,435 25,774 26,620 44,479 45,430 The following are amounts arising from investment properties that have been recognised in profit or loss during the financial year. Note Operator Family General Company Rental Income ,172 9,398 1,032 1,144 4,872 6,106 Investment properties comprise a number of commercial properties that are leased to third parties. In prior year, three properties have been transferred from property and equipment (see Note 3) to investment properties, since the buildings were no longer used by the Group and the Company and are now leased to third parties. The Group s and the Company s investment properties were valued by independent professional valuer firms, using the comparison, cost and investment methods of valuations, where applicable. In the comparison method approach, the sales and listings of comparable properties of within nearby locations are compiled. From the compiled data, adjustments are made by the valuers between the subject property and those similar properties.

137 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Investment properties (continued) The adjustments made are in relation to location, size and shape of the lot, physical features, legal and legislative constraints, building design and condition, time element, planning provision, improvements and renovation works made, if any, surrounding developments, facilities and amenities available and other factors that may affect the value of the subject property. These adjustments are therefore subject to uncertainties such as property market outlook, potential increases in rental rates and general economic conditions. In the cost method approach, the indication of values consists of the sum of the present worth of the improvement value. For the valuation of the improvements, the valuers have considered the following: i) Cost of replacement of the building in accordance with current trend of market prices for materials, labour, contractor s overhead, profit and fees; ii) Accrued depreciation as evidenced by the observed condition and present and prospective serviceability in comparison with new units of like kind; and iii) Extent, character and utility of the property. The investment method is the capitalisation of net rent from a property. Net rent is the residue of gross annual rent less annual expenses (outgoings) required to sustain the rent with allowance for void and management fees. During the year, the external valuers have considered the results of all these three methods in their valuation and applied professional judgement in the selection of the fair value of these investment properties. In prior year, the external valuers performed an update valuation of market value of these investment properties in arriving at the fair value, after considering the properties existing condition.

138 136 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 5. Investment in subsidiaries Company Operator/Company At cost Unquoted shares 80,759 80,759 80,759 Less: Accumulated impairment losses (17,030) (17,030) (10,012) 63,729 63,729 70,747 Details of the subsidiaries are as follows: Country of Effective ownership interest Name of subsidiaries Principal activities incorporation Asean Retakaful International (L) Ltd. ( ARIL )** Family and General retakaful business Malaysia 63.09% 63.09% 63.09% P.T. Syarikat Indonesia and its subsidiaries* Investment holding Indonesia 56.00% 56.00% 56.00% P.T. Asuransi Umum* General business Indonesia 64.70% 64.70% 64.70% P.T. Asuransi Keluarga* Family business Indonesia 74.80% 74.80% 74.80% * Not audited by KPMG Desa Megat & Co ** Members Voluntary Winding-up commenced on 21 May The subsidiary has been consolidated based on management accounts. 6. Investment in associate Investment in associate company amounting to RM2,473,000 ( and : RM2,473,000) was fully impaired during the financial year ended 30 June 2007.

139 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Other investments The other investments comprise the following: Note Operator Family General Group Available-for-sale (a) 391,994 3,012, ,764 3,928,857 Fair value through profit or loss (b) , ,299 Held-to-maturity (c) 1, ,271 35, , ,213 3,485, ,339 4,439, Available-for-sale (a) 264,293 2,554, ,623 3,254,122 Fair value through profit or loss (b) - 174, ,392 Held-to-maturity (c) 4, ,931 34, , ,445 2,999, ,119 3,738, Available-for-sale (a) 169,502 2,442, ,691 3,014,585 Fair value through profit or loss (b) - 184, ,571 Held-to-maturity (c) 2, ,666 34, , ,418 2,885, ,215 3,495,262

140 138 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 7. Other investments (continued) The other investments comprise the following (continued): Note Operator Family General Company Available-for-sale (a) 384,209 2,922, ,442 3,829,204 Fair value through profit or loss (b) - 113, ,682 Held-to-maturity (c) - 241,908 32, , ,209 3,278, ,164 4,217, Available-for-sale (a) 255,631 2,475, ,609 3,165,939 Fair value through profit or loss (b) - 108, ,913 Held-to-maturity (c) - 241,904 32, , ,631 2,826, ,375 3,549, Available-for-sale (a) 163,377 2,374, ,687 2,939,754 Fair value through profit or loss (b) - 120, ,170 Held-to-maturity (c) - 241,905 32, , ,377 2,736, ,496 3,334,638

141 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Other investments (continued) (a) Available-for-sale (AFS) financial assets At fair value Operator Family General Group Equity securities: - Quoted in Malaysia 37, ,295 85, ,460 - Quoted outside Malaysia Unquoted in Malaysia Unquoted outside Malaysia , ,347 85, ,935 Unit trusts: - Quoted in Malaysia 24,844 31,955 10,935 67,734 - Quoted outside Malaysia 6,730 79,889 2,322 88,941 - Unquoted in Malaysia 61, ,332 36, ,981 92, ,176 49, ,656 Malaysian Government Islamic papers 20, ,388 93, ,459 Islamic debt securities: - Unquoted in Malaysia 199,576 1,758, ,051 2,295,190 - Unquoted outside Malaysia 1,012 9,605-10, ,588 1,768, ,051 2,305,807 Investment in linked funds 40, Total AFS financial assets 391,994 3,012, ,764 3,928,857

142 140 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 7. Other investments (continued) (a) Available-for-sale (AFS) financial assets (continued) At fair value Operator Family General Group Equity securities: - Quoted in Malaysia 36, ,651 57, ,633 - Quoted outside Malaysia Unquoted in Malaysia Unquoted outside Malaysia , ,066 57, ,010 Unit trusts: - Quoted in Malaysia 12,934 18,730 5,047 36,711 - Quoted outside Malaysia 5,214 48,826 1,014 55,054 - Unquoted in Malaysia 48, ,649 33, ,086 66, ,205 39, ,851 Malaysian Government Islamic papers 10, ,315 89, ,706 Islamic debt securities: - Unquoted in Malaysia 108,506 1,473, ,341 1,869,423 - Unquoted outside Malaysia 2,866 29,266-32, ,372 1,502, ,341 1,901,555 Investment in linked funds 38, Total AFS financial assets 264,293 2,554, ,623 3,254,122

143 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Other investments (continued) (a) Available-for-sale (AFS) financial assets (continued) At fair value Operator Family General Group Equity securities: - Quoted in Malaysia 39, ,301 59, ,461 - Quoted outside Malaysia Unquoted in Malaysia Unquoted outside Malaysia , ,540 59, ,215 Unit trusts: - Quoted in Malaysia 11,649 18,524 5,616 35,789 - Quoted outside Malaysia 6,079 25,798 1,004 32,881 - Unquoted in Malaysia 32, ,594 28, ,024 49, ,916 34, ,694 Malaysian Government Islamic papers - 465,994 88, ,450 Islamic debt securities: - Unquoted in Malaysia 43,307 1,452, ,117 1,752,426 - Unquoted outside Malaysia - 41,800-41,800 43,307 1,493, ,117 1,794,226 Investment in linked funds 36, Total AFS financial assets 169,502 2,442, ,691 3,014,585

144 142 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 7. Other investments (continued) (a) Available-for-sale (AFS) financial assets (continued) At fair value Operator Family General Company Equity securities: - Quoted in Malaysia 37, ,295 85, ,460 - Unquoted in Malaysia , ,295 85, ,840 Unit trusts: - Quoted in Malaysia 24,844 31,955 10,935 67,734 - Unquoted in Malaysia 61, ,332 36, ,981 86, ,287 47, ,715 Malaysian Government Islamic papers 20, ,388 93, ,459 Islamic debt securities: - Unquoted in Malaysia 199,576 1,758, ,051 2,295,190 Investment in linked funds 40, Total AFS financial assets 384,209 2,922, ,442 3,829,204

145 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Other investments (continued) (a) Available-for-sale (AFS) financial assets (continued) At fair value Operator Family General Company Equity securities: - Quoted in Malaysia 36, ,651 57, ,633 - Unquoted in Malaysia , ,651 57, ,013 Unit trusts: - Quoted in Malaysia 12,934 18,730 5,047 36,711 - Unquoted in Malaysia 48, ,649 33, ,086 61, ,379 38, ,797 Malaysian Government Islamic papers 10, ,315 89, ,706 Islamic debt securities: - Unquoted in Malaysia 108,506 1,473, ,341 1,869,423 Investment in linked funds 38, Total AFS financial assets 255,631 2,475, ,609 3,165,939

146 144 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 7. Other investments (continued) (a) Available-for-sale (AFS) financial assets (continued) At fair value Operator Family General Company Equity securities: - Quoted in Malaysia 39, ,301 59, ,461 - Quoted in Malaysia , ,436 59, ,065 Unit trusts: - Quoted in Malaysia 11,649 18,524 5,616 35,789 - Unquoted in Malaysia 32, ,594 28, ,024 43, ,118 33, ,813 Malaysian Government Islamic papers - 465,994 88, ,450 Islamic debt securities: - Unquoted in Malaysia 43,307 1,452, ,117 1,752,426 Investment in linked funds 36, Total AFS financial assets 163,377 2,374, ,687 2,939,754

147 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Other investments (continued) (b) Fair value through profit or loss (FVTPL) financial assets At fair value Operator Family General Group Equity securities: - Quoted in Malaysia - 39,753-39,753 - Quoted outside Malaysia - 32,330-32,330-72,083-72,083 Investment units in commodity, equity and fixed income closed end fund: - Unquoted in Malaysia - 59,662-59,662 Unit trusts: - Quoted outside Malaysia - 29,580-29,580 Islamic debt securities: - Unquoted in Malaysia - 14,267-14,267 - Unquoted outside Malaysia ,073-44, ,340-58,974 Total FVTPL financial assets , ,299

148 146 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 7. Other investments (continued) (b) Fair value through profit or loss (FVTPL) financial assets (continued) At fair value Operator Family General Group Equity securities: - Quoted in Malaysia - 29,747-29,747 - Quoted outside Malaysia - 31,251-31,251-60,998-60,998 Investment units in commodity, equity and fixed income closed end fund: - Unquoted in Malaysia - 63,906-63,906 Unit trusts: - Quoted outside Malaysia - 25,971-25,971 Islamic debt securities: - Unquoted in Malaysia - 15,260-15,260 - Unquoted outside Malaysia - 8,257-8,257-23,517-23,517 Total FVTPL financial assets - 174, ,392

149 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Other investments (continued) (b) Fair value through profit or loss (FVTPL) financial assets (continued) At fair value Operator Family General Group Equity securities: - Quoted in Malaysia - 26,483-26,483 Investment units in commodity, equity and fixed income closed end fund: - Unquoted in Malaysia - 79,649-79,649 Unit trusts: - Quoted outside Malaysia - 56,868-56,868 Islamic debt securities: - Unquoted in Malaysia - 14,038-14,038 - Unquoted outside Malaysia - 7,533-7,533-21,571-21,571 Total FVTPL financial assets - 184, ,571 At fair value Operator Family General Company Equity securities: - Quoted in Malaysia - 39,753-39,753 Investment units in commodity, equity and fixed income closed end fund: - Unquoted in Malaysia - 59,662-59,662 Islamic debt securities: - Unquoted in Malaysia - 14,267-14,267 Total FVTPL financial assets - 113, ,682

150 148 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 7. Other investments (continued) (b) Fair value through profit or loss (FVTPL) financial assets (continued) At fair value Operator Family General Company Equity securities: - Quoted in Malaysia - 29,747-29,747 Investment units in commodity, equity and fixed income closed end fund: - Unquoted in Malaysia - 63,906-63,906 Islamic debt securities: - Unquoted in Malaysia - 15,260-15,260 Total FVTPL financial assets - 108, ,913 At fair value Operator Family General Company Equity securities: - Quoted in Malaysia - 26,483-26,483 Investment units in commodity, equity and fixed income closed end fund: - Unquoted in Malaysia - 79,649-79,649 Islamic debt securities: - Unquoted in Malaysia - 14,038-14,038 Total FVTPL financial assets - 120, ,170

151 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Other investments (continued) (c) Held-to-maturity (HTM) financial assets Operator Family General Group At amortised cost Islamic debt securities: - Unquoted in Malaysia - 129, ,127 - Unquoted outside Malaysia 1,585 11,363 2,853 15,801 Malaysian Government Islamic papers - 112,781 32, ,503 Total HTM financial assets 1, ,271 35, ,431 At fair value Islamic debt securities: - Unquoted in Malaysia - 142, ,033 - Unquoted outside Malaysia 1,598 11,563 2,937 16,098 Malaysian Government Islamic papers - 115,176 33, ,527 Total HTM financial assets 1, ,772 36, , Operator Family General Group At amortised cost Islamic debt securities: - Unquoted in Malaysia - 129, ,061 - Unquoted outside Malaysia 4,152 29,027 1,730 34,909 Malaysian Government Islamic papers - 112,843 32, ,609 Total HTM financial assets 4, ,931 34, ,579 At fair value Islamic debt securities: - Unquoted in Malaysia - 138, ,988 - Unquoted outside Malaysia 4,165 28,579 1,730 34,474 Malaysian Government Islamic papers - 114,631 33, ,910 Total HTM financial assets 4, ,198 35, ,372

152 150 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 7. Other investments (continued) (c) Held-to-maturity (HTM) financial assets (continued) Operator Family General Group At amortised cost Islamic debt securities: - Unquoted in Malaysia - 129, ,002 - Unquoted outside Malaysia 2,916 16,761 1,715 21,392 Malaysian Government Islamic papers - 112,903 32, ,712 Total HTM financial assets 2, ,666 34, ,106 At fair value Islamic debt securities: - Unquoted in Malaysia - 136, ,887 - Unquoted outside Malaysia 2,916 16,761 1,715 21,392 Malaysian Government Islamic papers - 112,835 32, ,680 Total HTM financial assets 2, ,483 34, , Operator Family General Company At amortised cost Islamic debt securities: - Unquoted in Malaysia - 129, ,127 Malaysian Government Islamic papers - 112,781 32, ,503 Total HTM financial assets - 241,908 32, ,630 At fair value Islamic debt securities: - Unquoted in Malaysia - 142, ,033 Malaysian Government Islamic papers - 115,176 33, ,527 Total HTM financial assets - 257,209 33, ,560

153 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Other investments (continued) (c) Held-to-maturity (HTM) financial assets (continued) Operator Family General Company At amortised cost Islamic debt securities: - Unquoted in Malaysia - 129, ,061 Malaysian Government Islamic papers - 112,843 32, ,609 Total HTM financial assets - 241,904 32, ,670 At fair value Islamic debt securities: - Unquoted in Malaysia - 138, ,988 Malaysian Government Islamic papers - 114,631 33, ,910 Total HTM financial assets - 253,619 33, , Operator Family General Company At amortised cost Islamic debt securities: - Unquoted in Malaysia - 129, ,002 Malaysian Government Islamic papers - 112,903 32, ,712 Total HTM financial assets - 241,905 32, ,714 At fair value Islamic debt securities: - Unquoted in Malaysia - 136, ,887 Malaysian Government Islamic papers - 112,835 32, ,680 Total HTM financial assets - 249,722 32, ,567

154 152 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 7. Other investments (continued) (d) Carrying values of financial instruments Note AFS FVTPL HTM Group At 1 January ,014, , ,106 3,495,262 Purchases 1,894,490 22, ,811 2,060,964 Maturities (44,769) - (130,405) (175,174) Disposals (1,603,619) (41,571) - (1,645,190) Dividend income capitalised 9, ,467 Fair value gains/(losses) recorded in: Profit or loss 25-8,170-8,170 Other comprehensive income 37.2 (3,580) - - (3,580) Participants' fund (5,277) - - (5,277) Allowance for impairment in financial assets 30 (8,250) - - (8,250) Amortisation of premiums, net of accretion of discounts 1,780 - (39) 1,741 Effect of movement in exchange rates (705) (40) At 31 December 2011/1 January ,254, , ,579 3,738,093 Purchases 2,490,821 94,162 9,678 2,594,661 Maturities (40,799) (1,500) (9,852) (52,151) Disposals (1,743,679) (45,925) (16,407) (1,806,011) Fair value gains/(losses) recorded in: Profit or loss 25-6,334-6,334 Other comprehensive income , ,844 Participants' fund (12,300) - - (12,300) Allowance for impairment in financial assets 30 (8,304) - - (8,304) Amortisation of premiums, net of accretion of discounts (6,824) - (223) (7,047) Effect of movement in exchange rates (8,024) (7,164) (2,344) (17,532) At 31 December ,928, , ,431 4,439,587

155 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Other investments (continued) (d) Carrying values of financial instruments (continued) Note AFS FVTPL HTM Company At 1 January ,939, , ,714 3,334,638 Purchases 1,793,725 22,144-1,815,869 Maturities (44,769) - (5) (44,774) Disposals (1,519,862) (38,955) - (1,558,817) Dividend income capitalised 9, ,467 Fair value gains/(losses) recorded in: Profit or loss 25-5,554-5,554 Other comprehensive income 37.2 (3,444) - - (3,444) Participants' fund (2,462) - - (2,462) Allowance for impairment in financial assets 30 (8,250) - - (8,250) Amortisation of premiums, net of accretion of discounts 1,780 - (39) 1,741 At 31 December 2011/1 January ,165, , ,670 3,549,522 Purchases 2,422,920 20,931-2,443,851 Maturities (38,500) (1,500) - (40,000) Disposals (1,697,864) (21,143) - (1,719,007) Fair value gains/(losses) recorded in: Profit or loss 25-6,481-6,481 Other comprehensive income , ,754 Participants' fund (11,917) - - (11,917) Allowance for impairment in financial assets 30 (8,304) - - (8,304) Amortisation of premiums, net of accretion of discounts (6,824) - (40) (6,864) At 31 December ,829, , ,630 4,217,516

156 154 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 7. Other investments (continued) (e) Fair values of financial instruments Quoted market prices category are financial instruments that are measured in whole or in part by reference to published quotes in an active market. A financial instrument is regarded as quoted in an active market if quoted prices are readily and regularly available from an exchange and published market price from print medias. Market observable financial instruments are measured using a valuation technique based on assumptions that are supported by prices from observable current market transactions and are instruments for which pricing is obtained from Bond Pricing Agency Malaysia and regulatory agency. The fair value of investments in structured products are obtained via investments bankers and/ or fund managers. Non-market observable inputs means that fair values are determined in whole or in part using a valuation technique based on assumptions that are neither supported by prices from observable current market transactions in the same instrument nor are they based on available market data. The main asset class in this category are unquoted equity securities. The fair values of the unquoted equity securities were determined to approximate the carrying amount as these are immaterial in the context of the financial statements. (f) Maturity of other investments The following investments mature after 12 months: Operator Family General Group AFS financial assets 210,727 2,238, ,298 2,837,561 FVTPL financial assets ,317-42,951 HTM financial assets 1, ,519 35, , AFS financial assets 115,276 1,952, ,443 2,434,842 FVTPL financial assets - 77,657-77,657 HTM financial assets 4, ,357 33, , AFS financial assets 43,307 1,861, ,719 2,237,809 FVTPL financial assets - 13,069-13,069 HTM financial assets 2, ,236 34, ,504

157 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Other investments (continued) (f) Maturity of other investments (continued) Operator Family General Company AFS financial assets 209,672 2,228, ,976 2,824,579 FVTPL financial assets - 9,733-9,733 HTM financial assets - 241,908 32, , AFS financial assets 115,276 1,930, ,429 2,412,379 FVTPL financial assets - 77,657-77,657 HTM financial assets - 231,904 32, , AFS financial assets 43,307 1,823, ,714 2,198,112 FVTPL financial assets - 13,069-13,069 HTM financial assets - 241,905 32, ,714

158 156 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 8. Retakaful assets Note Family General Group Family General Company Claims liabilities 17(a) 18, , ,150 17, , ,029 Contribution liabilities 17(b) - 72,297 72,297-69,745 69,745 Actuarial liabilities 17(c) 63,856-63,856 58,161-58,161 82, , ,303 75, , , Claims liabilities 17(a) 8, , ,019 7, , ,821 Contribution liabilities 17(b) - 88,597 88,597-85,326 85,326 Actuarial liabilities 17(c) 64,808-64,808 59,755-59,755 72, , ,424 66, , , Claims liabilities 17(a) 2, , ,303 1, , ,007 Contribution liabilities 17(b) - 48,213 48,213-36,059 36,059 Actuarial liabilities 17(c) 40,617-40,617 35,642-35,642 43, , ,133 37, , ,708

159 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Deferred tax (assets)/liabilities Deferred tax (assets) and liabilities are attributable to the following: Assets Liabilities Net Group Operator Property and equipment - (25) (32) (25) (32) Investment properties - - (121) 1,992 1,651-1,992 1,651 (121) Other investments ,837 2, ,837 2,816 Loans and receivables, excluding takaful receivables (630) (976) (1,345) (630) (976) (1,345) receivables (863) (1,222) (1,933) (863) (1,222) (1,933) Other payables (11,435) (10,280) (3,931) (11,435) (10,280) (3,931) Expense reserves (21,918) (4,614) (3,124) (21,918) (4,614) (3,124) Unabsorbed tax losses (2,253) (2,182) (2,752) (2,253) (2,182) (2,752) Tax (assets)/liabilities (37,099) (19,299) (13,238) 2,717 3,488 2,816 (34,382) (15,811) (10,422) Set off of tax 2,717 3,488 2,816 (2,717) (3,488) (2,816) Net tax assets (34,382) (15,811) (10,422) (34,382) (15,811) (10,422) Group Property and equipment - (25) (32) (25) (32) Investment properties - - (121) 1,780 1,651-1,780 1,651 (121) Other investments ,837 2, ,837 2,816 Loans and receivables, excluding takaful receivables (630) (976) (1,345) (630) (976) (1,345) receivables (863) (1,222) (1,933) (863) (1,222) (1,933) Other payables (11,435) (10,280) (3,931) (11,435) (10,280) (3,931) Expense reserves (21,918) (4,614) (3,124) (21,918) (4,614) (3,124) Unabsorbed tax losses (2,253) (2,182) (2,752) (2,253) (2,182) (2,752) Tax (assets)/liabilities (37,099) (19,299) (13,238) 2,717 3,488 2,816 (34,382) (15,811) (10,422) Set off of tax 2,717 3,488 2,816 (2,717) (3,488) (2,816) Net tax assets (34,382) (15,811) (10,422) (34,382) (15,811) (10,422)

160 158 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 9. Deferred tax (assets)/liabilities (continued) Assets Liabilities Net Company Operator Investment properties - - (121) 1,992 1,651-1,992 1,651 (121) Investment in subsidiaries (2,130) (2,130) (375) (2,130) (2,130) (375) Other investments ,837 4, ,837 4,078 Loans and receivables, excluding takaful receivables (383) (680) (1,345) (383) (680) (1,345) receivables (863) (1,222) (1,577) (863) (1,222) (1,577) Other payables (8,317) (6,818) (1,706) (8,317) (6,818) (1,706) Expense reserves (21,243) (3,939) (2,449) (21,243) (3,939) (2,449) Tax (assets)/liabilities (32,936) (14,789) (7,573) 2,313 3,488 4,078 (30,623) (11,301) (3,495) Set off of tax 2,313 3,488 4,078 (2,313) (3,488) (4,078) Net tax assets (30,623) (11,301) (3,495) (30,623) (11,301) (3,495) Company Property and equipment Investment properties - - (121) 1,780 1,651-1,780 1,651 (121) Investment in subsidiaries (2,130) (2,130) (375) (2,130) (2,130) (375) Other investments ,837 4, ,837 4,078 Loans and receivables, excluding takaful receivables (383) (680) (1,345) (383) (680) (1,345) receivables (863) (1,222) (1,577) (863) (1,222) (1,577) Other payables (8,317) (6,818) (1,706) (8,317) (6,818) (1,706) Expense reserves (21,243) (3,939) (2,449) (21,243) (3,939) (2,449) Tax (assets)/liabilities (32,936) (14,789) (7,573) 2,313 3,488 4,078 (30,623) (11,301) (3,495) Set off of tax 2,313 3,488 4,078 (2,313) (3,488) (4,078) Net tax assets (30,623) (11,301) (3,495) (30,623) (11,301) (3,495)

161 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Deferred tax (assets)/liabilities (continued) As at Recognised in profit or loss (Note 31) Recognised in other comprehensive income (Note 31) Effects of movement in exchange rate As at Recognised in profit or loss (Note 31) Recognised in other comprehensive income (Note 31) Effects of movement in exchange rate As at Group Operator Property and equipment (32) (25) (25) 404 Investment properties (121) 1, , ,992 Other investments 2,816 (39) (927) (13) 1,837 (2,455) Loans and receivables, excluding takaful receivables (1,345) (4) (976) (630) receivables (1,933) (1,222) (863) Other payables (3,931) (6,348) - (1) (10,280) (1,325) (11,435) Expense reserves (3,124) (1,490) - - (4,614) (17,304) - - (21,918) Unabsorbed tax losses (2,752) (28) (2,182) (263) (2,253) Tax (assets)/liabilities (10,422) (4,416) (927) (46) (15,811) (20,321) 1, (34,382) Group Property and equipment (32) (25) (25) 616 Investment properties (121) 1, , ,780 Other investments 2,816 (39) (927) (13) 1,837 (2,455) Loans and receivables, excluding takaful receivables (1,345) (4) (976) (630) receivables (1,933) (1,222) (863) Other payables (3,931) (6,348) - (1) (10,280) (1,325) (11,435) Expense reserves (3,124) (1,490) - - (4,614) (17,304) - - (21,918) Unabsorbed tax losses (2,752) (28) (2,182) (263) (2,253) Tax (assets)/liabilities (10,422) (4,416) (927) (46) (15,811) (20,533) 1, (34,382)

162 160 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 9. Deferred tax (assets)/liabilities (continued) As at Recognised in profit or loss (Note 31) Recognised in other comprehensive income (Note 31) As at Recognised in profit or loss (Note 31) Recognised in other comprehensive income (Note 31) As at Company Operator Investment properties (121) 1,772-1, ,992 Investment in subsidiaries (375) (1,755) - (2,130) - - (2,130) Other investments 4,078 (1,381) (860) 1,837 (2,455) Loans and receivables, excluding takaful receivables (1,345) (680) (383) receivables (1,577) (1,222) (863) Other payables (1,706) (5,112) - (6,818) (1,499) - (8,317) Expense reserves (2,449) (1,490) - (3,939) (17,304) - (21,243) Tax (assets)/liabilities (3,495) (6,946) (860) (11,301) (20,261) 939 (30,623) Company Property and equipment Investment properties (121) 1,772-1, ,780 Investment in subsidiaries (375) (1,755) - (2,130) - - (2,130) Other investments 4,078 (1,381) (860) 1,837 (2,455) Loans and receivables, excluding takaful receivables (1,345) (680) (383) receivables (1,577) (1,222) (863) Other payables (1,706) (5,112) - (6,818) (1,499) - (8,317) Expense reserves (2,449) (1,490) - (3,939) (17,304) - (21,243) Tax (assets)/liabilities (3,495) (6,946) (860) (11,301) (20,473) 1,151 (30,623)

163 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Loans and receivables, excluding takaful receivables Note Operator Family General Group Financing receivables: Secured financing ,625 5,561 76,470 Unsecured financing Staff financing 7, ,250 Allowance for impairment 37.4 (1,253) (301) (381) (1,935) 6,819 70,324 5,180 82,323 Fixed and call deposits with licensed financial institutions with maturity more than three months: Licensed banks in Malaysia 49, ,738 80, ,288 Banks outside Malaysia 5,252 9,879 2,381 17,512 54, ,617 82, ,800 Other receivables: Investment receivable 10,994 64,768 8,764 84,526 Sundry deposits 347 1,263 1,062 2,672 Due from Operator ,263 - Due from Family Fund 20 34,390-12,631 - Due from General Fund 20 14, Prepayment 5, ,210 Sundry receivables 6,830 1, ,802 71,932 67,180 28, , , , , ,333

164 162 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 10. Loans and receivables, excluding takaful receivables (continued) Note Operator Family General Group Financing receivables: Secured financing 1,371 72,556 6,964 80,891 Staff financing 12, ,024 Allowance for impairment 37.4 (2,102) (944) (1,024) (4,070) 11,293 71,612 5,940 88,845 Fixed and call deposits with licensed financial institutions with maturity more than three months: Licensed banks in Malaysia 127, , , ,530 Banks outside Malaysia 5,854 12,811 2,807 21, , , , ,002 Other receivables: Investment receivable 2,801 28,736 6,447 37,984 Sundry deposits Due from Family Fund 20 17,176-4,811 - Due from General Fund 20 3, Prepayment 6, ,649 Sundry receivables 6,576 2,701 2,030 11,307 37,190 31,437 13,288 56, , , , ,350

165 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Loans and receivables, excluding takaful receivables (continued) Note Operator Family General Group Financing receivables: Secured financing 2,653 75,362 4,386 82,401 Unsecured financing - - 5,000 5,000 Staff financing 14, ,708 Allowance for impairment 37.4 (2,923) (2,986) (3,066) (8,975) 14,438 72,376 6,320 93,134 Fixed and call deposits with licensed financial institutions with maturity more than three months: Licensed banks in Malaysia 119, , , ,080 Banks outside Malaysia 8,116 11,336-19, , , , ,532 Other receivables: Investment receivable 1,748 47,464 7,529 56,741 Sundry deposits Due from Operator Due from Family Fund 20 24,341-6,692 - Due from General Fund 20 12, Prepayment 4, ,991 Sundry receivables 6,394 3,099 2,495 11,988 50,298 50,742 17,179 74, , , , ,060

166 164 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 10. Loans and receivables, excluding takaful receivables (continued) Note Operator Family General Company Financing receivables: Secured financing ,625 5,561 76,402 Unsecured financing Staff financing 5, ,509 Allowance for impairment 37.4 (1,253) (301) (381) (1,935) 5,010 70,324 5,180 80,514 Fixed and call deposits with licensed financial institutions with maturity more than three months: Licensed banks in Malaysia 49, ,188 77, ,373 Other receivables: Investment receivable 10,994 64,768 8,764 84,526 Sundry deposits 347 1,263 1,062 2,672 Due from Family Fund 20 27,761-12,631 - Due from General Fund 20 13, Prepayment 3, ,602 Sundry receivables ,258 57,401 66,562 22,457 92, , , , ,945

167 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Loans and receivables, excluding takaful receivables (continued) Note Operator Family General Company Financing receivables: Secured financing 1,257 72,556 6,964 80,777 Staff financing 8, ,728 Allowance for impairment 37.4 (1,823) (944) (1,024) (3,791) 8,162 71,612 5,940 85,714 Fixed and call deposits with licensed financial institutions with maturity more than three months: Licensed banks in Malaysia 108, , , ,985 Other receivables: Investment receivable 2,801 28,736 6,447 37,984 Sundry deposits Due from Family Fund 20 9,568-4,811 - Due from General Fund 20 5, Prepayments 3, ,645 Sundry receivables 774 1, ,388 22,305 30,516 12,092 45, , , , ,190

168 166 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 10. Loans and receivables, excluding takaful receivables (continued) Note Operator Family General Company Financing receivables: Secured financing 2,310 75,362 4,386 82,058 Unsecured financing - - 5,000 5,000 Staff financing 10, ,617 Allowance for impairment 37.4 (2,644) (2,986) (3,066) (8,696) 10,283 72,376 6,320 88,979 Fixed and call deposits with licensed financial institutions with maturity more than three months: Licensed banks in Malaysia 114, , , ,080 Other receivables: Investment receivable 1,748 47,464 7,529 56,741 Sundry deposits Due from Family Fund 20 17,927-6,692 - Due from General Fund 20 12, Prepayments 2, ,925 Sundry receivables 737 2,983 2,495 6,215 36,161 50,626 16,716 66, , , , ,614

169 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Loans and receivables, excluding takaful receivables (continued) The following loans and receivables, excluding takaful receivables mature after 12 months: Operator Family General Group Financing receivables 5,091 70,000 5,000 80,091 Fixed and call deposits with licensed financial institutions - 12,778 4,314 17,092 Other receivables 347 1,263 1,062 2,672 5,438 84,041 10,376 99, Financing receivables 3,560 70,648 5,360 79,568 Fixed and call deposits with licensed financial institutions - 18,065 6,645 24,710 Other receivables - 1,122-1,122 3,560 89,835 12, , Financing receivables 11,293 71,612 5,940 88,845 Fixed and call deposits with licensed financial institutions - 10,710 3,475 14,185 Other receivables ,788 82,501 9, ,704

170 168 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 10. Loans and receivables, excluding takaful receivables (continued) The following loans and receivables, excluding takaful receivables mature after 12 months (continued): Operator Family General Company Financing receivables 3,284 70,000 5,000 78,284 Fixed and call deposits with licensed financial institutions - 2,899 1,933 4,832 Other receivables 347 1,263 1,062 2,672 3,631 74,162 7,995 85, Financing receivables ,648 5,360 76,440 Fixed and call deposits with licensed financial institutions - 18,065 6,645 24,710 Other receivables - 1,122-1, ,835 12, , Financing receivables 8,162 71,612 5,940 85,714 Fixed and call deposits with licensed financial institutions - 10,710 3,475 14,185 Other receivables ,657 82,501 9, ,573 Estimation of fair values The fair value of the financing receivables were determined to approximate the carrying amounts as these are immaterial in the context of the financial statements. The carrying amounts of fixed and call deposits and other receivables approximate their fair values.

171 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report receivables Note Family General Group Family General Company Due contributions 59,998 22,380 82,378 58,099 17,575 75,674 Due from retakaful/ co-takaful 12,375 10,143 22,518 8,644 6,931 15,575 72,373 32, ,896 66,743 24,506 91,249 Less: Allowance for impaired debts 37.4 (3,901) (6,982) (10,883) (3,850) (6,901) (10,751) 68,472 25,541 94,013 62,893 17,605 80, Due contributions 54,739 41,663 96,402 51,392 38,369 89,761 Due from retakaful/ co-takaful 13,180 15,321 28,501 8,404 2,571 10,975 67,919 56, ,903 59,796 40, ,736 Less: Allowance for impaired debts 37.4 (5,567) (9,522) (15,089) (5,441) (9,444) (14,885) 62,352 47, ,814 54,355 31,496 85, Due contributions 44,744 67, ,324 40,004 57,325 97,329 Due from retakaful/ co-takaful 8,347 22,704 31,051 3,264 8,137 11,401 53,091 90, ,375 43,268 65, ,730 Less: Allowance for impaired debts 37.4 (9,434) (26,719) (36,153) (7,976) (23,047) (31,023) 43,657 63, ,222 35,292 42,415 77,707

172 170 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 12. Qardh receivables Note 2012 Operator Group 2011 At 1 January 277 1, Increase during the year 3, ,551 1, Qardh written off 30 (3,542) (1,145) - - Effect of movement in exchange rates (9) (1) - - At 31 December Cash and cash equivalents Operator Family General Group Cash and bank balances 6,507 29,983 11,731 48,221 Fixed and call deposits with licensed financial institutions with maturity less than three months Licensed banks in Malaysia 71, ,102 37, ,384 Banks outside Malaysia 24,982 67,087 11, , , ,172 61, , Cash and bank balances 8,226 31,485 6,438 46,149 Fixed and call deposits with licensed financial institutions with maturity less than three months Licensed banks in Malaysia 29, ,981 31, ,467 Banks outside Malaysia 23,504 72,026 9, ,911 61, ,492 47, ,527

173 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Cash and cash equivalents (continued) Operator Family General Group Cash and bank balances 2,691 11,775 11,841 26,307 Fixed and call deposits with licensed financial institutions with maturity less than three months Licensed banks in Malaysia 48, ,072 50, ,170 Banks outside Malaysia 24,187 61,831 6,380 92,398 75, ,678 69, ,875 Operator Family General Company Cash and bank balances 4,775 24,769 10,344 39,888 Fixed and call deposits with licensed financial institutions with maturity less than three months Licensed banks in Malaysia 44, ,479 32, ,892 49, ,248 42, , Cash and bank balances 8,123 23,137 3,431 34,691 Fixed and call deposits with licensed financial institutions with maturity less than three months Licensed banks in Malaysia 19, ,310 29, ,308 27, ,447 32, ,999

174 172 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 13. Cash and cash equivalents (continued) Operator Family General Company Cash and bank balances 2,321 6,446 10,152 18,919 Fixed and call deposits with licensed financial institutions with maturity less than three months Licensed banks in Malaysia 25, ,820 39, ,064 27, ,266 50, ,983 The carrying amounts approximate their fair values due to the relatively short-term nature of these financial instruments. 14. Assets held for sale As at 31 December 2012, the assets held for sale are as follows: Note Operator Family General Group/ Company At 1 January Transferred from investment properties At 31 December 2011/1 January Settlement for asset held for sale - (668) - (668) Transferred from investment properties 4 1,340 1, ,240 At 31 December ,340 1, , Capital and reserves Amount operator / Group / Company / / Number of shares 000 Authorised Ordinary shares of RM1.00 each 500, ,000 Issued and fully paid Ordinary shares of RM1.00 each 162, ,817

175 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Capital and reserves (continued) The holders of ordinary shares are entitled to receive dividends as declared from time to time and are entitled to one vote per share at meetings of the Company. Translation reserve The translation reserve comprises all foreign currency differences arising from the translation of the financial statements of foreign operations. Fair value reserve The fair value reserve comprises the cumulative net change in the fair value of available-for-sale financial assets recognised in other comprehensive income until the investments are derecognised or impaired. Revaluation reserve The revaluation reserve relates to the revaluation of property. Section 108 tax credit The Finance Act, 2007 introduced a single tier company income tax system with effect from 1 January As such, the remaining Section 108 tax credit will be available to the Company until such time the credit is fully utilised or upon expiry of the six-year transitional period on 31 December 2013, whichever is earlier. The Company had fully utilised its available Section 108 tax credit balances in prior year. Therefore, the Company is currently distributing single tier exempt dividend to its shareholders out of its entire retained earnings. 16. Qardh payables 2012 Family Fund General Fund Group At 1 January 11,398 12,173 20,798 19, (Decrease)/Increase during the year (592) (1,078) 3,866 1, Effect of movement in exchange rates (408) 303 (776) At 31 December 10,398 11,398 23,888 20,

176 174 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 17. contract liabilities The takaful contract liabilities comprise the following: Family General Group Group Note Provision for outstanding claims 17(a) 148, ,681 52, , , , , , ,460 Provision for unearned contributions 17(b) , , , , , ,042 Participants fund 17(c) 4,254,771 3,935,483 3,667, , , ,448 4,434,586 4,081,300 3,815,899 4,403,336 4,038,164 3,720,215 1,100,743 1,067, ,046 5,463,099 5,067,636 4,644,401 Family General Company Company Note Provision for outstanding claims 17(a) 140,673 93,693 44, , , , , , ,434 Provision for unearned contributions 17(b) , , , , , ,515 Participants fund 17(c) 3,958,110 3,660,092 3,425, , , ,314 4,134,823 3,821,339 3,585,839 4,098,783 3,753,785 3,469,856 1,042,433 1,003, ,792 5,100,236 4,719,376 4,289,788

177 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report contract liabilities (continued) (a) Provision for outstanding claims the provision for outstanding claims and its movements are further analysed as follows: Group Gross Family General Group Retakaful Net Gross Retakaful Net Gross Retakaful Net Provision for claims reported by participants 28,387 (3,707) 24, ,557 (221,036) 168, ,944 (224,743) 193,201 Provision for IBNR 120,178 (14,964) 105, ,952 (61,443) 133, ,130 (76,407) 238,723 Provision for outstanding claims 148,565 (18,671) 129, ,509 (282,479) 302, ,074 (301,150) 431, Provision for claims reported by participants 30,237 (1,279) 28, ,642 (215,374) 172, ,879 (216,653) 201,226 Provision for IBNR 72,444 (6,723) 65, ,859 (38,643) 105, ,303 (45,366) 170,937 Provision for outstanding claims 102,681 (8,002) 94, ,501 (254,017) 277, ,182 (262,019) 372, Provision for claims reported by participants 26,762 (1,080) 25, ,285 (211,009) 145, ,047 (212,089) 170,958 Provision for IBNR 26,142 (1,312) 24, ,271 (25,902) 81, ,413 (27,214) 106,199 Provision for outstanding claims 52,904 (2,392) 50, ,556 (236,911) 226, ,460 (239,303) 277,157

178 176 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 17. contract liabilities (continued) (a) Provision for outstanding claims (continued) Company Gross Family General Company Retakaful Net Gross Retakaful Net Gross Retakaful Net Provision for claims reported by participants 25,386 (2,854) 22, ,014 (204,619) 151, ,400 (207,473) 173,927 Provision for IBNR 115,287 (14,721) 100, ,375 (60,835) 128, ,662 (75,556) 229,106 Provision for outstanding claims 140,673 (17,575) 123, ,389 (265,454) 279, ,062 (283,029) 403, Provision for claims reported by participants 26,150 (696) 25, ,045 (190,079) 149, ,195 (190,775) 175,420 Provision for IBNR 67,543 (6,349) 61, ,236 (37,697) 99, ,779 (44,046) 160,733 Provision for outstanding claims 93,693 (7,045) 86, ,281 (227,776) 249, ,974 (234,821) 336, Provision for claims reported by participants 24,085 (266) 23, ,433 (154,882) 124, ,518 (155,148) 148,370 Provision for IBNR 20,386 (1,269) 19, ,530 (25,590) 75, ,916 (26,859) 95,057 Provision for outstanding claims 44,471 (1,535) 42, ,963 (180,472) 200, ,434 (182,007) 243,427

179 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report contract liabilities (continued) (a) Provision for outstanding claims (continued) Movement of provision for outstanding claims: Family General Group Group Note Gross Retakaful Net Gross Retakaful Net Gross Retakaful Net At 1 January ,904 (2,392) 50, ,556 (236,911) 226, ,460 (239,303) 277,157 Claims incurred during the year 436,516 (22,685) 413, ,274 (69,437) 160, ,803 (92,122) 570,681 Adjustment to claims incurred in prior accident years (8,241) 25,765 17,524 (8,241) 25,765 17,524 Claims paid during the year 27 (432,862) 22,113 (410,749) (189,669) 38,902 (150,767) (618,544) 61,015 (557,529) Increase in IBNR 46,302 (5,411) 40,891 36,588 (12,741) 23,847 82,890 (18,152) 64,738 Effect of movement in exchange rates (179) (1,007) 405 (602) (1,186) 778 (408) At 31 December 2011/ 1 January ,681 (8,002) 94, ,501 (254,017) 277, ,182 (262,019) 372,163 Claims incurred during the year 482,686 (31,992) 450, ,791 (49,523) 147, ,824 (81,515) 594,309 Adjustment to claims incurred in prior accident years (18,639) 15,631 (3,008) (18,639) 15,631 (3,008) Claims paid during the year 27 (484,087) 29,475 (454,612) (173,590) 26,523 (147,067) (654,024) 55,998 (598,026) Increase in IBNR 47,734 (8,241) 39,493 51,093 (22,800) 28,293 98,827 (31,041) 67,786 Effect of movement in exchange rates (449) 89 (360) (2,647) 1,707 (940) (3,096) 1,796 (1,300) At 31 December ,565 (18,671) 129, ,509 (282,479) 302, ,074 (301,150) 431,924

180 178 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 17. contract liabilities (continued) (a) Provision for outstanding claims (continued) Family General Company Company Note Gross Retakaful Net Gross Retakaful Net Gross Retakaful Net At 1 January ,471 (1,535) 42, ,963 (180,472) 200, ,434 (182,007) 243,427 Claims incurred during the year 369,063 (15,225) 353, ,154 (53,318) 145, ,230 (68,543) 495,687 Adjustment to claims incurred in prior accident years ,320 (8,517) 7,803 16,320 (8,517) 7,803 Claims paid during the year 27 (366,998) 14,795 (352,203) (154,862) 26,638 (128,224) (517,873) 41,433 (476,440) Increase in IBNR 47,157 (5,080) 42,077 35,706 (12,107) 23,599 82,863 (17,187) 65,676 At 31 December 2011/ 1 January ,693 (7,045) 86, ,281 (227,776) 249, ,974 (234,821) 336,153 Claims incurred during the year 415,213 (21,507) 393, ,837 (53,553) 134, ,397 (75,060) 524,336 Adjustment to claims incurred in prior accident years (18,639) 15,631 (3,007) (18,639) 15,631 (3,007) Claims paid during the year 27 (415,977) 19,349 (396,628) (153,229) 23,382 (129,847) (565,553) 42,731 (522,822) Increase in IBNR 47,744 (8,372) 39,372 52,139 (23,138) 29,001 99,883 (31,510) 68,373 At 31 December ,673 (17,575) 123, ,389 (265,454) 279, ,062 (283,029) 403,033

181 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report contract liabilities (continued) (b) Provision for unearned contributions the provision for unearned contributions and its movements are further analysed as follows: Group Gross General Retakaful Net Gross Group Retakaful Net Provision for unearned contributions 295,439 (72,297) 223, ,439 (72,297) 223, Provision for unearned contributions 352,154 (88,597) 263, ,154 (88,597) 263, Provision for unearned contributions 312,042 (48,213) 263, ,042 (48,213) 263,829 Company Gross General Retakaful Net Gross Company Retakaful Net Provision for unearned contributions 279,351 (69,745) 209, ,351 (69,745) 209, Provision for unearned contributions 327,063 (85,326) 241, ,063 (85,326) 241, Provision for unearned contributions 278,515 (36,059) 242, ,515 (36,059) 242,456

182 180 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 17. contract liabilities (continued) (b) Provision for unearned contributions (continued) Movement of provision for unearned contributions: Group Note Gross General Retakaful Net Gross Group Retakaful Net At 1 January ,042 (48,213) 263, ,042 (48,213) 263,829 Contributions written during the year ,889 (154,871) 287, ,499 (154,871) 286,628 Contributions earned during the year 22 (401,747) 114,401 (287,346) (401,357) 114,401 (286,956) Effect of movement in exchange rates (30) (30) At 31 December 2011/1 January ,154 (88,597) 263, ,154 (88,597) 263,557 Contributions written during the year ,437 (105,688) 295, ,960 (105,688) 295,272 Contributions earned during the year 22 (457,129) 121,955 (335,174) (456,652) 121,955 (334,697) Effect of movement in exchange rates (1,023) 33 (990) (1,023) 33 (990) At 31 December ,439 (72,297) 223, ,439 (72,297) 223,142 Company Note Gross General Retakaful Net Gross Company Retakaful Net At 1 January ,515 (36,059) 242, ,515 (36,059) 242,456 Contributions written during the year ,316 (139,159) 244, ,926 (139,159) 243,767 Contributions earned during the year 22 (334,768) 89,892 (244,876) (334,378) 89,892 (244,486) At 31 December 2011/1 January ,063 (85,326) 241, ,063 (85,326) 241,737 Contributions written during the year ,547 (97,408) 252, ,070 (97,408) 251,662 Contributions earned during the year 22 (397,259) 112,989 (284,270) (396,782) 112,989 (283,793) At 31 December ,351 (69,745) 209, ,351 (69,745) 209,606

183 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report contract liabilities (continued) (c) Participants fund Participants fund balance at end of reporting period comprise the following: Group Family General Group Gross Retakaful Net Gross Retakaful Net Gross Retakaful Net Actuarial liabilities 3,274,935 (63,856) 3,211, ,274,935 (63,856) 3,211,079 Unallocated surplus/ accumulated surplus 681, , , , , ,337 AFS reserve 97,326-97,326 10,464-10, , ,790 Translation reserve ,048-1,048 1,407-1,407 Net assets value attributable to unitholders 201, , , ,117 4,254,771 (63,856) 4,190, , ,795 4,434,586 (63,856) 4,370, Actuarial liabilities 3,124,963 (64,808) 3,060, ,124,963 (64,808) 3,060,155 Unallocated surplus/ accumulated surplus 511, , , , , ,969 AFS reserve 110, ,710 9,380-9, , ,090 Translation reserve ,678-1,678 Net assets value attributable to unitholders 187, , , ,600 3,935,483 (64,808) 3,870, , ,039 4,081,300 (64,808) 4,016,492

184 182 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 17. contract liabilities (continued) (c) Participants fund (continued) Group Family General Group Gross Retakaful Net Gross Retakaful Net Gross Retakaful Net Actuarial liabilities 2,909,664 (40,617) 2,869, ,909,664 (40,617) 2,869,047 Unallocated surplus/ accumulated surplus 455, , , , , ,288 AFS reserve 105, ,340 18,665-18, , ,005 Translation reserve ,590-1,590 Net assets value attributable to unitholders 196, , , ,352 3,667,311 (40,617) 3,626, , ,448 3,815,899 (40,617) 3,775,282 Company Family General Company Gross Retakaful Net Gross Retakaful Net Gross Retakaful Net Actuarial liabilities 3,061,645 (58,161) 3,003, ,086,592 (58,161) 3,028,431 Unallocated surplus/ accumulated surplus 675, , , , , ,967 AFS reserve 98,215-98,215 10,373-10, , ,588 Net assets value attributable to unitholders 122, , ,676-81,676 3,958,110 (58,161) 3,899, , ,693 4,134,823 (58,161) 4,076,662

185 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report contract liabilities (continued) (c) Participants fund (continued) Company Family General Company Gross Retakaful Net Gross Retakaful Net Gross Retakaful Net Actuarial liabilities 2,927,235 (59,755) 2,867, ,927,235 (59,755) 2,867,480 Unallocated surplus/ accumulated surplus 502, , , , , ,042 AFS reserve 111, ,153 9,352-9, , ,505 Net assets value attributable to unitholders 118, , ,557-80,557 3,660,092 (59,755) 3,600, , ,469 3,821,339 (59,755) 3,761, Actuarial liabilities 2,745,004 (35,642) 2,709, ,745,004 (35,642) 2,709,362 Unallocated surplus/ accumulated surplus 448, , , , , ,987 AFS reserve 103, ,035 18,570-18, , ,605 Net assets value attributable to unitholders 129, , ,243-92,243 3,425,385 (35,642) 3,389, , ,314 3,585,839 (35,642) 3,550,197

186 184 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 17. contract liabilities (continued) (c) Participants fund (continued) the participants fund movements are analysed as follows: Group Gross Family General Group Retakaful Net Gross Retakaful Net Gross Retakaful Net At 1 January ,667,311 (40,617) 3,626, , ,448 3,815,899 (40,617) 3,775,282 Net earned contributions 694,719 (28,671) 666, , , ,675 (28,671) 953,004 Investment income 165, ,760 28,532-28, , ,292 Realised gains and (losses) 71,641-71,641 16,389-16,389 88,030-88,030 Fair value gains and (losses) 12,009-12, ,652-12,652 Other operating income 37,116-37,116 45,711-45,711 82,827-82,827 Net benefits and claims (482,465) 27,743 (454,722) (201,176) - (201,176) (679,654) 27,743 (651,911) Fees deducted (127,479) - (127,479) (31,438) - (31,438) (158,917) - (158,917) Other operating expenses (9,544) - (9,544) (5,458) - (5,458) (15,002) - (15,002) Release of special reserves (23,061) - (23,061) (23,061) - (23,061) Profit paid to participants (2,420) - (2,420) (23,173) - (23,173) (25,593) - (25,593) Increase in actuarial liabilities (863) (24,191) (25,054) (863) (24,191) (25,054) Profit attributable to the Operator (98,746) 928 (97,818) (85,547) - (85,547) (189,252) 928 (188,324) Change in AFS reserve 5,370-5,370 (9,285) - (9,285) (3,915) - (3,915) Effect of movement in exchange rates 3,074-3,074 (892) - (892) 2,182-2,182 At 31 December ,935,483 (64,808) 3,870, , ,039 4,081,300 (64,808) 4,016,492

187 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report contract liabilities (continued) (c) Participants fund (continued) Group Gross Family General Group Retakaful Net Gross Retakaful Net Gross Retakaful Net At 1 January ,935,483 (64,808) 3,870, , ,039 4,081,300 (64,808) 4,016,492 Net earned contributions 987,661 (46,869) 940, , ,174 1,322,835 (46,869) 1,275,966 Investment income 186, ,381 31,031-31, , ,412 Realised gains and (losses) 98,082-98,082 13,508-13, , ,590 Fair value gains and (losses) 10,634-10,634 (306) - (306) 10,328-10,328 Other operating income 6,587-6,587 5,675-5,675 12,262-12,262 Net benefits and claims (530,420) 40,233 (490,187) (172,553) - (172,553) (702,973) 40,233 (662,740) Fees deducted (net) (195,496) - (195,496) (80,600) - (80,600) (276,096) - (276,096) Other operating expenses (12,722) - (12,722) (5,319) - (5,319) (18,041) - (18,041) Profit paid to participants (2,330) - (2,330) (27,558) - (27,558) (29,888) - (29,888) Increase in actuarial liabilities (14,309) 489 (13,820) (14,309) 489 (13,820) Profit attributable to the Operator (135,816) 6,636 (129,180) (61,833) - (61,833) (200,407) 6,636 (193,771) Change in AFS reserve (13,384) - (13,384) 1,084-1,084 (12,300) - (12,300) Withholding tax (41,036) - (41,036) (1,773) - (1,773) (42,809) - (42,809) Effect of movement in exchange rates (24,544) 463 (24,081) (24,318) 463 (23,855) At 31 December ,254,771 (63,856) 4,190, , ,795 4,434,586 (63,856) 4,370,730

188 186 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 17. contract liabilities (continued) (c) Participants fund (continued) Company Gross Family General Company Retakaful Net Gross Retakaful Net Gross Retakaful Net At 1 January ,425,385 (35,642) 3,389, , ,314 3,585,839 (35,642) 3,550,197 Net earned contributions 563,342 (12,609) 550, , , ,218 (12,609) 795,609 Investment income 154, ,058 27,923-27, , ,981 Realised gains and (losses) 69,681-69,681 16,311-16,311 85,992-85,992 Fair value gains and (losses) 9,393-9, ,036-10,036 Other operating income 36,017-36,017 41,157-41,157 77,174-77,174 Net benefits and claims (416,220) 20,305 (395,915) (177,238) - (177,238) (593,458) 20,305 (573,153) Fees deducted (net) (90,873) - (90,873) (6,437) - (6,437) (97,310) - (97,310) Other operating expenses (9,544) - (9,544) (5,458) - (5,458) (15,002) - (15,002) Release of special reserves (23,061) - (23,061) (23,061) - (23,061) Profit paid to participants (2,029) - (2,029) (22,527) - (22,527) (24,556) - (24,556) Increase in actuarial liabilities (2,171) (24,113) (26,284) (2,171) (24,113) (26,284) Profit attributable to the Operator (85,065) (7,696) (92,761) (84,816) - (84,816) (171,243) (7,696) (178,939) Change in AFS reserve 8,118-8,118 (9,218) - (9,218) (1,100) - (1,100) At 31 December ,660,092 (59,755) 3,600, , ,469 3,821,339 (59,755) 3,761,584

189 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report contract liabilities (continued) (c) Participants fund (continued) Company Gross Family General Company Retakaful Net Gross Retakaful Net Gross Retakaful Net At 1 January ,660,092 (59,755) 3,600, , ,469 3,821,339 (59,755) 3,761,584 Net earned contributions 862,722 (33,244) 829, , ,270 1,146,992 (33,244) 1,113,748 Investment income 165, ,218 30,164-30, , ,382 Realised gains and (losses) 92,909-92,909 13,358-13, , ,267 Fair value gains and (losses) 10,256-10,256 (306) - (306) 9,950-9,950 Other operating income 5,514-5,514 4,953-4,953 10,467-10,467 Net benefits and claims (462,957) 29,879 (433,078) (160,277) - (160,277) (623,234) 29,879 (593,355) Fees deducted (net) (164,817) - (164,817) (57,430) - (57,430) (222,247) - (222,247) Other operating expense (11,596) - (11,596) (3,732) - (3,732) (15,328) - (15,328) Profit paid to participants (1,572) - (1,572) (27,558) - (27,558) (29,130) - (29,130) Increase in actuarial liabilities (15,603) 1,594 (14,009) (15,603) 1,594 (14,009) Profit attributable to the Operator (128,082) 3,365 (124,717) (64,466) - (64,466) (195,306) 3,365 (191,941) Withholding tax (41,036) - (41,036) (1,773) - (1,773) (42,809) - (42,809) Change in AFS reserves (12,938) - (12,938) 1,021-1,021 (11,917) - (11,917) At 31 December ,958,110 (58,161) 3,899, , ,693 4,134,823 (58,161) 4,076,662

190 188 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 18. Expense reserves 2012 Operator/ Group Operator/ Company 2011 At 1 January 19,739 12,502 15,758 9,800 Provision for the year, net 70,110 7,317 69,215 5,958 Effect of movement in exchange rates (363) (80) - - At 31 December 89,486 19,739 84,973 15, payables Family General Group Family General Company Due to retakaful companies 11,674 20,069 31,743 6,491 17,949 24,440 Due to intermediaries/participants 8,827 2,556 11,383 8,827 2,556 11,383 20,501 22,625 43,126 15,318 20,505 35, Due to retakaful companies 11,715 22,479 34,194 8,149 19,960 28,109 Due to intermediaries/participants 7,781 3,562 11,343 7,781 3,562 11,343 19,496 26,041 45,537 15,930 23,522 39, Due to retakaful companies 4,912 29,013 33,925 1,928 24,872 26,800 Due to intermediaries/participants 10,305 6,224 16,529 10,305 6,224 16,529 15,217 35,237 50,454 12,233 31,096 43,329 The carrying amounts disclosed above approximate their fair values at the end of the reporting period.

191 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Other payables Note Operator Family General Group Advanced takaful contribution - 9,215 5,099 14,314 Deposit payable 294 1, ,435 Profit payable to participants - 1,028 2,583 3,611 Unclaimed monies - 14,544-14,544 Outstanding purchases of investment securities 1,552 7,605 1,569 10,726 Due to Operator 10-34,390 14,161 - Due to General Fund 10 5,263 12, Zakat payable 1, ,211 Other payables and accruals 76,211 75,193 37, ,172 84, ,434 61, , Advanced takaful contribution - 5,356 8,090 13,446 Deposit payable 296 3,285-3,581 Profit payable to participants - - 3,997 3,997 Unclaimed monies - - 1,703 1,703 Outstanding purchases of investment securities 638 6, ,409 Due to Operator 10-17,176 3,425 - Due to General Fund 10-4, Zakat payable Other payables and accruals 64,387 91,703 34, ,545 65, ,119 52, , Advanced takaful contribution - 15,624 7,150 22,774 Deposit payable 278 2,423-2,701 Profit payable to participants - - 4,348 4,348 Unclaimed monies - - 3,160 3,160 Outstanding purchases of investment securities - - 3,298 3,298 Due to Operator 10-24,341 12,329 - Due to General Fund , Zakat payable 1, ,231 Other payables and accruals 33, ,326 35, ,612 35, ,406 66, ,124

192 190 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 20. Other payables (continued) Note Operator Family General Company Advanced takaful contribution - 7,178 5,099 12,277 Deposit payable 294 1, ,435 Profit payable to participants ,315 2,346 Unclaimed monies - 14,544-14,544 Outstanding purchases of investment securities 1,552 7,605 1,569 10,726 Due to Operator 10-27,761 13,970 - Due to General Fund 10-12, Zakat payable Other payables and accruals 70,045 73,579 37, ,661 72, ,157 60, , Advanced takaful contribution - 5,356 8,090 13,446 Deposit payable 296 1,680-1,976 Profit payable to participants - - 3,997 3,997 Unclaimed monies - - 1,703 1,703 Outstanding purchases of investment securities 638 6, ,409 Due to Operator 10-9,568 5,043 - Due to General Fund 10-4, Zakat payable Other payables and accruals 54,110 90,042 26, ,411 55, ,245 46, , Advanced takaful contribution - 15,624 7,150 22,774 Deposit payable 278 1,908-2,186 Profit payable to participants - - 4,253 4,253 Unclaimed monies - - 3,160 3,160 Outstanding purchases of investment securities - - 3,298 3,298 Due to Operator 10-17,927 12,329 - Due to General Fund 10-6, Zakat payable Other payables and accruals 22, ,222 32, ,045 22, ,373 62, ,870 The carrying amounts disclosed above approximate their fair values at the end of the reporting period.

193 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Operating revenue Note Operator Family General Group to Gross contributions , ,437 1,373,965 Investment income 23 19, ,381 31, ,569 19,456 1,159, ,468 1,607, to Gross contributions , ,889 1,140,843 Investment income 23 14, ,760 28, ,630 14, , ,421 1,345, to Note Operator Family General Company Gross contributions , ,547 1,197,781 Investment income 23 17, ,218 30, ,708 17,000 1,013, ,711 1,407, to Gross contributions , , ,662 Investment income 23 11, ,058 27, ,253 11, , ,239 1,140,915

194 192 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 22. Net earned contributions Note Family General Group to to to to to to (i) Gross contributions 17(b),21 973, , , ,889 1,373,965 1,140,843 Change in actuarial reserves/unearned contributions reserves 14,656 (4,625) 55,692 (40,142) 70,348 (44,767) Gross earned contributions 17(b) 987, , , ,747 1,444,313 1,096,076 (ii) Retakaful 17(b) (45,798) (27,608) (105,688) (154,871) (151,486) (182,479) Change in actuarial reserves/unearned contributions reserves (1,071) (1,063) (16,267) 40,470 (17,338) 39,407 Contributions ceded to retakaful 17(b) (46,869) (28,671) (121,955) (114,401) (168,824) (143,072) (iii) Net earned contributions 17(b) 940, , , ,346 1,275, ,004 Note Family General Company to to to to to to (i) Gross contributions 17(b),21 848, , , ,316 1,197, ,662 Change in actuarial reserves/unearned contributions reserves 14,011 (4,394) 47,712 (48,548) 61,723 (52,942) Gross earned contributions 862, , , ,768 1,259, ,720 (ii) Retakaful 17(b) (33,244) (12,609) (97,408) (139,159) (130,652) (151,768) Change in actuarial reserves/unearned contributions reserves - - (15,581) 49,267 (15,581) 49,267 Contributions ceded to retakaful (33,244) (12,609) (112,989) (89,892) (146,233) (102,501) (iii) Net earned contributions 17(b) 829, , , ,876 1,113, ,219

195 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Investment income to Note Operator Family General Group Rental income from investment properties ,821 1,032 4,901 FVTPL financial assets Dividend income - Equity securities quoted in Malaysia - 1,470-1,470 Profit earned on Islamic debts securities - 13,042-13,042 AFS financial assets Dividend income - Equity securities quoted in Malaysia 1,603 12,802 3,022 17,427 - Unit trusts 3,534 10,146 1,945 15,625 Profit income - Islamic debts securities 8,085 95,064 17, ,479 - Malaysian Government Islamic papers ,644 3,653 23,701 Amortisation of premiums, net of accretion of discounts (513) (4,453) (1,858) (6,824) HTM financial assets Profit income - Islamic debts securities 466 6, ,294 - Malaysian Government Islamic papers - 4,369 1,280 5,649 Amortisation of premiums, net of accretion of discounts - (178) (45) (223) LAR profit income 4,290 17,041 4,416 25,747 Cash and cash equivalents profit income 1,425 3, ,667 Investment expenses (580) (1,657) (544) (386) Total investment income 21 19, ,381 31, ,569

196 194 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 23. Investment income (continued) to Note Operator Family General Group Rental income from investment properties ,067 1,144 6,140 FVTPL financial assets - Dividend income - - Equity securities quoted in Malaysia Profit earned on Islamic debts securities AFS financial assets - Dividend income - - Equity securities quoted in Malaysia 1,054 8,253 1,621 10,928 - Unit trusts 1,909 8,519 1,784 12,212 Profit income - - Islamic debts securities 3,370 86,612 13, ,558 - Malaysian Government Islamic papers 3 19,559 4,004 23,566 Amortisation of premiums, net of accretion of discounts (332) 2,708 (596) 1,780 HTM financial assets - Profit income - - Islamic debts securities 29 4, ,467 - Malaysian Government Islamic papers - 2, ,779 Amortisation of premiums, net of accretion of discounts - (10) (29) (39) LAR profit income 7,926 23,496 6,434 37,856 Cash and cash equivalents profit income Investment expenses (432) (2,288) (461) (1,310) Total investment income 21 14, ,760 28, ,630

197 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Investment income (continued) to Note Operator Family General Company Rental income from investment properties ,172 1,032 4,872 FVTPL financial assets Dividend income - Equity securities quoted in Malaysia - 1,470-1,470 Profit earned on Islamic debts securities AFS financial assets Dividend income - Equity securities quoted in Malaysia 1,603 12,802 3,022 17,427 - Unit trusts 3,534 10,146 1,945 15,625 Profit income - Islamic debts securities 8,085 91,017 17, ,432 - Malaysian Government Islamic papers ,644 3,653 23,701 Amortisation of premiums, net of accretion of discounts (513) (4,453) (1,858) (6,824) HTM financial assets Profit income - Islamic debts securities - 6,464-6,464 - Malaysian Government Islamic papers - 4,369 1,280 5,649 Amortisation of premiums, net of accretion of discounts - 5 (45) (40) LAR profit income 3,717 16,406 4,326 24,449 Cash and cash equivalents profit income Investment expenses (580) (1,657) (544) (386) Total investment income 21 17, ,218 30, ,708

198 196 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 23. Investment income (continued) to Note Operator Family General Company Rental income from investment properties ,398 1,144 6,106 FVTPL financial assets Dividend income - Equity securities quoted in Malaysia Profit earned on Islamic debts securities AFS financial assets Dividend income - Equity securities quoted in Malaysia 1,054 8,253 1,621 10,928 - Unit trusts 1,909 8,519 1,784 12,212 Profit income - Islamic debts securities 2,950 79,600 13,408 95,958 - Malaysian Government Islamic papers 3 19,559 4,004 23,566 Amortisation of premiums, net of accretion of discounts (332) 2,708 (596) 1,780 HTM financial assets Profit income - Islamic debts securities 29 4, ,467 - Malaysian Government Islamic papers - 2, ,779 Amortisation of premiums, net of accretion of discounts - (10) (29) (39) LAR profit income 5,645 19,475 5,993 31,113 Cash and cash equivalents profit income Investment expenses (432) (2,288) (461) (1,310) Total investment income 21 11, ,058 27, ,253

199 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Realised gains and (losses) Operator Family General Group to Realised gains/(losses): Property and equipment Investment properties - (72) - (72) AFS financial assets Equity securities - quoted in Malaysia 5,882 37,632 8,036 51,550 - quoted outside Malaysia Unit trusts - quoted in Malaysia 1,492 3, ,405 - quoted outside Malaysia 412 4, ,870 Islamic debt securities - unquoted in Malaysia 1,410 50,702 4,733 56,845 - unquoted outside Malaysia Malaysian Government Islamic papers 137 1, ,460 Total realised gains for AFS financial assets 9,540 98,154 13, ,202 9,699 98,082 13, , to Realised gains/(losses): Property and equipment Investment properties (1,003) (297) AFS financial assets Equity securities - quoted in Malaysia 6,689 39,619 10,599 56,907 - quoted outside Malaysia 113 (888) 78 (697) Unit trusts - quoted in Malaysia ,097 - unquoted in Malaysia quoted outside Malaysia ,270 Islamic debt securities - unquoted in Malaysia ,801 5,976 33,491 - unquoted outside Malaysia 248 1,961-2,209 Malaysian Government Islamic papers - 1, ,150 Total realised gains for AFS financial assets 9,270 70,935 17,392 97,597 9,299 71,641 16,389 97,329

200 198 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 24. Realised gains and (losses) (continued) Operator Family General Company to Realised gains/(losses): Property and equipment Investment properties - (72) - (72) AFS financial assets Equity securities - quoted in Malaysia 5,882 37,632 8,036 51,550 Unit trusts - quoted in Malaysia 1,492 3, ,405 Islamic debt securities - unquoted in Malaysia 1,410 50,702 4,733 56,845 Malaysian Government Islamic papers 137 1, ,460 Total realised gains for AFS financial assets 8,921 92,981 13, ,260 9,047 92,909 13, , to Realised gains/(losses): Property and equipment Investment properties (1,003) (297) AFS financial assets Equity securities - quoted in Malaysia 6,689 39,619 10,599 56,907 Unit trusts - quoted in Malaysia ,097 - unquoted in Malaysia Islamic debt securities - unquoted in Malaysia ,801 5,976 33,491 Malaysian Government Islamic papers - 1, ,150 Total realised gains for AFS financial assets 8,526 68,975 17,314 94,815 8,555 69,681 16,311 94,547

201 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Fair value gains and (losses) Note Operator Family General Group to Fair value gains/(losses) arising from: Investment properties ,300 (306) 2,257 FVTPL financial assets Equity securities - quoted in Malaysia - 3,922-3,922 Islamic debt securities - unquoted in Malaysia - (46) - (46) - unquoted outside Malaysia - (147) - (147) Commodity, equity and fixed income closed end fund - 2,605-2,605 Total fair value gains for FVTPL financial assets 7(d) - 6,334-6, ,634 (306) 8, to Fair value gains/(losses) arising from: Investment properties 4 1,460 3, (2,734) FVTPL financial assets Equity securities - quoted in Malaysia - 1,344-1,344 - quoted outside Malaysia - 2,616-2,616 Islamic debt securities - unquoted in Malaysia - (8) - (8) Commodity, equity and fixed income closed end fund - 4,218-4,218 Total fair value gains for FVTPL financial assets 7(d) - 8,170-8,170 1,460 12, ,436

202 200 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 25. Fair value gains and (losses) (continued) Note Operator Family General Company to Fair value gains/(losses) arising from: Investment properties ,775 (306) 2,315 FVTPL financial assets Equity securities - quoted in Malaysia - 3,922-3,922 Islamic debt securities - unquoted in Malaysia - (46) - (46) Commodity, equity and fixed income closed end fund - 2,605-2,605 Total fair value gains for FVTPL financial assets 7(d) - 6,481-6, ,256 (306) 8, to Fair value gains/(losses) arising from: Investment properties 4 1,450 3, (2,733) FVTPL financial assets Equity securities - quoted in Malaysia - 1,344-1,344 Islamic debt securities - unquoted in Malaysia - (8) - (8) Commodity, equity and fixed income closed end fund - 4,218-4,218 Total fair value gains for FVTPL financial assets 7(d) - 5,554-5,554 1,450 9, ,821

203 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Other operating income Note Operator Family General Group to Income from ILB, service charge and management fees 8, ,501 Miscellaneous income 1,931 3,760 2,485 8,176 Recovery of bad debts written off Writeback of allowance for impaired debts ,666 2,540 4,206 Writeback of allowance for impaired financing ,135 10,852 6,587 5,675 16, to Income from ILB, service charge and management fees 7, ,409 Miscellaneous income 1, ,284 Recovery of bad debts written off ,451 2,583 Writeback of allowance for impaired debts ,867 17,197 21,064 Writeback of allowance for impaired financing ,042 2,042 4,905 Writeback of special reserve - 30,673 23,061 53,734 10,238 37,116 45,711 86,979 Note Operator Family General Company to Income from ILB, service charge and management fees 6, Miscellaneous income - 2,762 1,760 4,522 Recovery of bad debts written off Writeback of allowance for impaired debts ,591 2,543 4,134 Writeback of allowance for impaired financing ,856 7,141 5,514 4,953 11, to Income from ILB, service charge and management fees 6, Miscellaneous income Recovery of bad debts written off ,451 2,583 Writeback of allowance for impaired debts ,535 13,603 16,138 Writeback of allowance for impaired financing ,042 2,042 4,905 Writeback of special reserve - 30,673 23,061 53,734 6,907 36,017 41,157 77,995

204 202 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 27. Net benefits and claims Group Note Family General Group to to to to to to Gross benefits/claims paid 17(a) (484,087) (432,862) (173,590) (189,669) (654,024) (618,544) Retakaful recoveries 17(a) 29,475 22,113 26,523 38,902 55,998 61,015 Net benefits/claims paid (454,612) (410,749) (147,067) (150,767) (598,026) (557,529) Gross change in contract liabilities: At 31 December 17(a) (148,565) (102,681) (584,509) (531,501) (733,074) (634,182) Less: At 1 January 17(a) (102,681) (52,904) (531,501) (463,556) (634,182) (516,460) Effect of movement in exchange rates (449) 174 (2,647) 1,395 (3,096) 1,569 (46,333) (49,603) (55,655) (66,550) (101,988) (116,153) Change in contract liabilities ceded to retakaful companies: At 31 December 17(a) 18,671 8, , , , ,019 Less: At 1 January 17(a) 8,002 2, , , , ,303 Effect of movement in exchange rates ,707 (965) 1,796 (945) 10,758 5,630 30,169 16,141 40,927 21,771 (490,187) (454,722) (172,553) (201,176) (659,087) (651,911)

205 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Net benefits and claims (continued) Company Note Family General Company to to to to to to Gross benefits/claims paid 17(a) (415,977) (366,998) (153,229) (154,862) (565,553) (517,873) Retakaful recoveries 17(a) 19,349 14,795 23,382 26,638 42,731 41,433 Net benefits/claims paid (396,628) (352,203) (129,847) (128,224) (522,822) (476,440) Gross change in contract liabilities: At 31 December 17(a) (140,673) (93,693) (545,389) (477,281) (686,062) (570,974) Less: At 1 January 17(a) (93,693) (44,471) (477,281) (380,963) (570,974) (425,434) (46,980) (49,222) (68,108) (96,318) (115,088) (145,540) Change in contract liabilities ceded to retakaful companies: At 31 December 17(a) 17,575 7, , , , ,821 Less: At 1 January 17(a) 7,045 1, , , , ,007 10,530 5,510 37,678 47,304 48,208 52,814 (433,078) (395,915) (160,277) (177,238) (589,702) (569,166)

206 204 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 28. Management expenses Group Note Operator to to to Group to Personnel expenses (including key management personnel) Directors remuneration - Salaries and other emoluments 3,907 1,852 3,907 1,852 - Fees Shariah Committee remuneration - Emoluments Fees Wages, salaries and others 102,811 90, ,334 89,673 Contributions to Employees' Provident Fund 12,553 9,106 12,553 9, , , , ,771 Depreciation of property and equipment 3 11,308 10,601 15,161 14,260 Auditors' remuneration Company auditors - Statutory audit Other services Other auditors - Statutory audit License fees Legal fees Professional fees 13,612 11,521 13,612 11,521 Rental of properties 8,057 8,353 2,363 2,438 Rental of equipments 1,403 2,284 1,403 2,284 Repair and maintenance - property and equipment 9,221 7,831 9,221 7,831 Travelling expenses 3,968 4,423 3,968 4,423 Utilities 2,030 2,426 2,030 2,426 Communication costs 6,437 6,552 6,437 6,552 Advertising 4,347 5,418 4,347 5,418 Other expenses 26,096 27,298 26,096 27,298 87,624 87,553 85,783 85,297 Total management expenses 208, , , ,068 All management expenses are borne by the Operator.

207 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Management expenses (continued) Company Note Operator to to to Company to Personnel expenses (including key management personnel) Directors remuneration - Salaries and other emoluments 3,550 1,763 3,550 1,763 - Fees Shariah Committee remuneration - Emoluments Fees Wages, salaries and others 83,506 76,355 83,029 75,965 Contributions to Employees' Provident Fund 12,315 9,106 12,315 9, ,351 87,970 99,874 87,580 Depreciation of property and equipment 3 9,934 9,419 13,059 12,382 Auditors' remuneration Company auditors - Statutory audit Other services License fees Legal fees Professional fees 12,600 10,702 12,600 10,702 Rental of properties 5,611 6, Rental of equipments 1,396 2,275 1,396 2,275 Repair and maintenance - property and equipment 7,647 6,840 7,647 6,840 Travelling expenses 3,557 3,759 3,557 3,759 Utilities 998 1, ,094 Communication costs 4,672 4,446 4,672 4,446 Advertising 2,677 3,573 2,677 3,573 Other expenses 20,812 14,825 20,812 14,825 70,883 63,582 68,939 61,294 Total management expenses 171, , , ,874 All management expenses are borne by the Operator.

208 206 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 29. Key management personnel compensation The key management personnel compensation are as follows: Operator/ Group to to Operator/ Company to to Directors of the Company Executive: Salaries and other emoluments 3,541 1,812 3,458 1,723 Fees Benefits-in-kind ,559 1,819 3,465 1,730 Non-executive: Other emoluments Fees Benefits-in-kind , Other key management personnel: Short-term employment benefits 6,625 4,426 5,729 3,718 Benefits-in-kind ,851 4,585 5,729 3,718 Total 11,591 7,313 10,069 6,072 The estimated monetary value of benefits-in-kind received by the Directors, are RM27,000 (2011: RM16,000) and RM7,000 (2011: RM12,000) at Group and Company level respectively.

209 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Other operating expenses Group Note Operator Family General Group to Impairment of: - AFS financial assets 7(d) 1,081 5,523 1,700 8,304 - Investment properties Property and equipment Write off of property and equipment Qardh written off 12 3, Agency related expenses 3, ,646 Miscellaneous expenses 326 7,173 3,619 10,819 8,838 12,722 5,319 23, to Impairment of: - AFS financial assets 7(d) 1,418 4,547 2,285 8,250 - Property and equipment Write off of property and equipment Qardh written off 12 1, ,145 Miscellaneous expenses 493 4,997 3,173 8,526 3,092 9,544 5,458 18,097

210 208 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 30. Other operating expenses (continued) Company Note Operator Family General Company to Impairment of: - AFS financial assets 7(d) 1,081 5,523 1,700 8,304 - Investment properties Property and equipment Write off of property and equipment Agency related expenses 3, ,646 Miscellaneous expenses 318 6,047 2,032 8,098 5,091 11,596 3,732 20, to Impairment of: - AFS financial assets 7(d) 1,418 4,547 2,285 8,250 - Investment in subsidiaries 3 7, ,018 - Property and equipment Write off of property and equipment Miscellaneous expenses 422 4,997 3,173 8,455 8,894 9,544 5,458 23,888

211 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Tax expense Note Group Operator to to to Group to Recognised in profit or loss Current tax expense Malaysian - current 44,847 24,434 44,847 24,434 Under provision in prior years - 4,288-4,288 Total current tax recognised in profit or loss 44,847 28,722 44,847 28,722 Deferred tax benefits Deferred tax recognised in profit or loss 9 (20,321) (4,416) (20,533) (4,416) Total tax expense 24,526 24,306 24,314 24,306 Reconciliation of tax expense Profit for the year 101,590 76, ,144 76,379 Zakat 1, , Total income tax expense 24,526 24,306 24,314 24,306 Profit before zakat and taxation 127, , , ,418 Income tax using Malaysian tax rate of 25% 31,779 25,355 31,365 25,355 Effect of tax rates in foreign jurisdictions (826) - (826) - Items not subject to tax (11,955) (11,654) (11,733) (11,654) Non deductible expenses 5,528 6,317 5,528 6,317 24,526 20,018 24,314 20,018 Under provision in prior years - 4,288-4,288 Tax expense 24,526 24,306 24,314 24,306 Recognised directly in equity Deferred tax AFS financial assets Property and equipment - Revalution reserve , ,

212 210 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 31. Tax expense (continued) Note Company Operator to to to Company to Recognised in profit or loss Current tax expense Malaysian - current 44,847 24,434 44,847 24,434 Under provision in prior years - 4,288-4,288 Total current tax recognised in profit or loss 44,847 28,722 44,847 28,722 Deferred tax benefits Deferred tax recognised in profit or loss 9 (20,261) (6,946) (20,473) (6,946) Total tax expense 24,586 21,776 24,374 21,776 Reconciliation of tax expense Profit for the year 103,984 71, ,657 71,709 Zakat Total income tax expense 24,586 21,776 24,374 21,776 Profit before zakat and taxation 128,669 93, ,820 93,959 Income tax using Malaysian tax rate of 25% 32,167 23,490 31,955 23,490 Items not subject to tax (12,839) (10,190) (12,839) (10,190) Non deductible expenses 5,258 4,188 5,258 4,188 24,586 17,488 24,374 17,488 Under provision in prior years - 4,288-4,288 Tax expense 24,586 21,776 24,374 21,776 Recognised directly in equity Deferred tax AFS financial assets Property and equipment - Revalution reserve ,

213 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Earnings per share - Group Basic earnings per ordinary share The calculation of basic earnings per ordinary share at 31 December 2012 was based on the profit attributable to ordinary shareholders of RM101,245,000 (2011: RM76,785,000) and a weighted average number of ordinary shares issued during the year of 162,817,000 (2011: 162,817,000). Basic earnings per ordinary share is not diluted as there is no potential ordinary share in issue at the end of the reporting period. 33. Dividends Dividends recognised by the Company: Sen per share (single tier) Total amount Date of payment to Ordinary dividend paid, final for financial year , Ordinary dividend paid, first interim for financial year , Ordinary dividend paid, second interim for financial year , Total amount 56, to Ordinary dividend paid, final for financial period , Ordinary dividend paid, interim for financial year , Total amount 17,910

214 212 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 34. Operating segments Segment information is presented in respect of the Group s geographical segments. This is based on the Group s management and internal reporting structure. Inter-segment pricing, if any, is determined based on negotiated terms. The Group does not present information by business segment as it is principally engaged as an operator of Family and General takaful/retakaful business. The financial position and performance of the Family and General businesses managed by the Group and Company have been disclosed separately within these financial statements. Segment results, assets and liabilities include items directly attributable to a segment as well as those that can be allocated on a reasonable basis. Unallocated items comprise expenses, which are all incurred by Operator for the management of funds. Segment capital expenditure is the total cost incurred during the year to acquire segment assets that are expected to be used for more than one year. Geographical segments In presenting information on the basis of geographical segments, segment revenue is based on the geographical location of customers. Segment assets are also based on the geographical location of assets. Geographical segments Malaysia Indonesia Consolidated 1 January 2012 to 31 December 2012 Total external revenue 1,408, ,250 1,607,534 Inter-segment revenue Total segment revenue 1,408, ,250 1,607,534 Segment result/profit before zakat and taxation 123,780 1, ,458 Zakat (1,000) Tax expense (24,314) Profit for the year 100,144 Segment assets by location of assets 5,946, ,426 6,371,644 Segment liabilities by location of liabilities 5,478, ,812 5,846,283 Capital expenditure by location of assets 6, ,474 Depreciation and amortisation 13,095 2,066 15,161 Non cash expenses other than depreciation and amortisation 8,376-8,376

215 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Operating segments (continued) Geographical segments Malaysia Indonesia Consolidated 1 January 2011 to 31 December 2011 Total external revenue 1,153, ,736 1,349,907 Inter-segment revenue Total segment revenue 1,153, ,736 1,349,907 Segment result/profit before zakat and taxation 98,543 2, ,418 Zakat (733) Tax expense (24,306) Profit for the year 76,379 Segment assets by location of assets 5,483, ,530 5,883,924 Segment liabilities by location of liabilities 1,240,612 66,779 1,307,391 Capital expenditure by location of assets 12,028 1,127 13,155 Depreciation and amortisation 12,191 2,069 14,260 Non cash expenses other than depreciation and amortisation 9,431-9,431

216 214 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 35. Risk management framework The Board with the assistance of the management team is responsible for the Risk Management Framework within the Group. The Board delegates the responsibility of oversight and monitoring of management s initiatives in managing key risk areas and ensure the functioning of the risk management processes to the Board Risk Committee ( BRC ). The BRC is supported by the Management Risk Committee ( MRC ) who is represented by the respective heads of divisions and headed by the Group Managing Director. The Group established the Operational Risk Management ( ORM ) Framework to ensure an ongoing process of identifying, evaluating, monitoring and managing the significant risk exposures surrounding its business operations. By executing the risk management process through robust controls, monitoring and responding to potential risks, the Group is able to mitigate risks to within the risk appetite of the Board. Operational Loss Incidences reporting based on the Basel II are reported to BRC and the Board to act as a gauge on the effectiveness of the ORM in place. Whistle Blowing Policy & Fraud and Integrity Policy, Shariah Governance Framework and Assets and Liabilities Management Framework are also in place to provide basic structure and further strengthen the existing control mechanism underlying the business activities. Business Continuity Management is consistently practiced in accordance with Bank Negara Malaysia guidelines. The Group tested the Business Continuity Plan annually to safeguard the lives of the employees and others in the office premises and tested the Disaster Recovery Plan twice a year to ensure the critical IT systems are up and running at all times. In Financial Risk, the Group has a Risk and Capital Management Framework to maintain financial resilience and stability, whilst having the flexibility of pursuing strategic business opportunities to optimize shareholder value. Stress Testing is conducted twice a year by the Actuarial Division together with Investment Department and Risk Management Department to ensure the Group s financial standing is secure under several risk scenarios. Asset and Liability Management Framework is also in place to enhance Financial Risk Management and facilitate in the Group s and the Group s investment strategy. 36. risk management (a) Family Fund The Family contracts consist of: (i) Family non-investment-linked contracts The Family non-investment-linked contracts are mainly credit related takaful products, group takaful schemes, yearly renewable individual ordinary medical plan, regular contribution individual ordinary plans and annuity plans. The main products type are Mortgage Reducing Term (MRTT), Group Credit, Group Term and Group Medical. (ii) Family investment-linked contracts The Family investment-linked contracts are mainly made up of regular contribution Investment-linked products and single contribution structured investment-linked plan. The main products are myinvest and mygenlife.

217 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report risk management (continued) (a) Family Fund (continued) (ii) Family investment-linked contracts (continued) The key coverage for the Family contracts The key coverage for the Family contracts are death, total and permanent disability, hospital and surgical benefits, personal accident benefits, daily hospitalisation cash allowance benefit, dread disease benefit, waiver of contribution benefits and survival benefits (for annuity). Concentration of Family risk The following gives details of the Group s and the Company s concentration of risks based on outstanding actuarial reserves by main product categories: Group Note Gross Retakaful Net 31 December 2012 Term 568,419 (19,433) 548,986 Endowment 1,367,038-1,367,038 Mortgage 1,020,053 (44,423) 975,630 Annuity 319, ,425 Total Family actuarial liabilities 17(c) 3,274,935 (63,856) 3,211, December 2011 Term 301,896 (1,361) 300,535 Endowment 1,431,443 (594) 1,430,849 Mortgage 1,082,552 (62,853) 1,019,699 Annuity 309, ,072 Total Family actuarial liabilities 17(c) 3,124,963 (64,808) 3,060,155 1 January 2011 Term 232,986 (2,402) 230,584 Endowment 1,400,820 (459) 1,400,361 Mortgage 971,472 (37,756) 933,716 Annuity 304, ,386 Total Family actuarial liabilities 17(c) 2,909,664 (40,617) 2,869,047

218 216 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 36. risk management (continued) (a) Family Fund (continued) Company Note Gross Retakaful Net 31 December 2012 Term 515,922 (19,433) 496,489 Endowment 1,196,245-1,196,245 Mortgage 1,030,053 (38,728) 991,325 Annuity 319, ,425 Total Family actuarial liabilities 17(c) 3,061,645 (58,161) 3,003, December 2011 Term 296, ,513 Endowment 1,272,259-1,272,259 Mortgage 1,049,391 (59,755) 989,636 Annuity 309, ,072 Total Family actuarial liabilities 17(c) 2,927,235 (59,755) 2,867,480 1 January 2011 Term 228, ,166 Endowment 1,264,731-1,264,731 Mortgage 947,721 (35,642) 912,079 Annuity 304, ,386 Total Family actuarial liabilities 17(c) 2,745,004 (35,642) 2,709,362 Key assumptions Arising from the adoption of guidelines on valuation basis for liabilities of Family Business (issued by Bank Negara Malaysia), with effect from 1 January 2012, reserves for all plans were valued on a basis that the Appointed Actuary would consider adequate and appropriate, and in line with the valuation basis set out by BNM in respect of the Guidelines on Valuation Basis for Liabilities of Family Business (BNM/RH/GL ). In prior year, reserves for all plans were valued on a basis that the Appointed Actuary would consider adequate and appropriate, and in line with the valuation basis set out by BNM in a letter issued by BNM in respect of the Valuation of Liabilities for Mortgage Reducing Term (JPIT/1/2007/TO) and Guidelines on Investment Linked Insurance/ Business (BNM/RH/GL ). For certain products where there is no specific guideline issued by BNM for takaful operators, the reserves were calculated in accordance with actuarial principles, taking into account the reserving methodology and basis stated in the Insurance Regulation, 1996 which was applicable to conventional insurance companies prior to implementation of Risk-Based Capital (RBC).

219 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report risk management (continued) (a) Family Fund (continued) Key assumptions (continued) The key assumptions to which the estimation of actuarial liabilities is particularly sensitive are as follows: - Mortality and morbidity rates This is significant for contract with significant coverage for death, total permanent disability and critical illness and the increase in the mortality or morbidity would have direct impact on the liability. - Discount rate As the liabilities are the present value of future cash flows, both income and outgo, a decrease in discount rate would have an increasing impact on the liabilities and vice-versa. - Surrender rate This is only applicable to long term products, where when the rate is reduced (products with PIF) or increased (products without PIF), will impact to an increase of the liability. No impact is observed for liabilities prior to Sensitivities A summary of key assumptions used for sensitivity analysis is as below: Mortality and morbidity rates Group and Company 31 December 2012 Discount rates Surrender rate Endowment +10% (i) -1% -20% Mortgage +10% (i) -1% -20% Investment-linked +10% (i) -1% -20% Mortality and morbidity rates Group and Company 31 December January 2011 Discount rate Mortality and morbidity rates Discount rate Endowment +10% (ii) -1% +10% (ii) -1% Mortgage +10% (iii) -1% +10% (iii) -1% Investment-linked +10% (ii) -1% +10% (ii) -1% (i) (ii) (iii) 10% Industry mortality and morbidity experience tables M8388 and M % Industry mortality and morbidity experience tables DGI96 10% Industry mortality and morbidity experience tables M8388

220 218 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 36. risk management (continued) (a) Family Fund (continued) Sensitivities (continued) The analysis below is performed for reasonably possible movements in each of the key assumptions with all other assumptions held constant, showing the impact on gross and net liabilities, and unallocated surplus. The correlation of assumptions will have a significant effect in determining the ultimate claims liabilities, but to demonstrate the impact due to changes in assumptions, assumptions had to be changed on an individual basis. It should be noted that movements in these assumptions are non-linear. Sensitivity information will also vary according to the current economic assumptions. Family takaful contracts Change in assumptions Impact on gross liabilities Impact on net liabilities Impact on unallocated surplus Group 31 December 2012 Mortality/morbidity +10% 134, ,949 (106,949) Discount rate -1% 130, ,713 (120,713) Surrender rate -20% 14,377 11,270 (11,270) 31 December 2011 Mortality/morbidity +10% 148, ,101 (131,101) Discount rate -1% 116, ,152 (106,152) 1 January 2011 Mortality/morbidity +10% 131, ,413 (117,413) Discount rate -1% 95,806 85,874 (85,874) Company 31 December 2012 Mortality/morbidity +10% 79,015 59,266 (59,266) Discount rate -1% 80,342 76,390 (76,390) Surrender rate -20% 14,377 11,270 (11,270) 31 December 2011 Mortality/morbidity +10% 103,595 89,984 (89,984) Discount rate -1% 73,339 67,284 (67,284) 1 January 2011 Mortality/morbidity +10% 98,322 86,662 (86,662) Discount rate -1% 63,813 56,691 (56,691)

221 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report risk management (continued) (b) General Fund The General contracts consist of fire, motor, personal accident, workmen s compensation and employers liability, liabilities and engineering and others. Concentration of General risk The table below sets out the concentration of General gross contribution by type of business. Gross Retakaful Net Group to Fire 120,820 (65,550) 55,270 Motor 188,568 (4,543) 184,025 Marine 12,675 (4,292) 8,383 Miscellaneous 79,374 (31,303) 48,071 Gross contributions 401,437 (105,688) 295, to Fire 117,618 (65,949) 51,669 Motor 177,991 (5,463) 172,528 Marine 21,445 (13,426) 8,019 Miscellaneous 124,835 (70,033) 54,802 Gross contributions 441,889 (154,871) 287,018 Company to Fire 103,270 (62,511) 40,759 Motor 167,616 (3,305) 164,311 Marine 10,637 (3,515) 7,122 Miscellaneous 68,024 (28,077) 39,947 Gross contributions 349,547 (97,408) 252, to Fire 99,186 (58,531) 40,655 Motor 155,794 (4,157) 151,637 Marine 17,468 (12,226) 5,242 Miscellaneous 110,868 (64,245) 46,623 Gross contributions 383,316 (139,159) 244,157

222 220 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 36. risk management (continued) (b) General Fund (continued) Key assumptions The key assumptions underlying the estimation of liabilities is that the Group s and the Company s future claims development will follow a similar pattern to past claims development experience, including average claim cost, average claim frequency, business mix for each accident year. Additional qualitative judgements are used to assess the extent to which past trends may not apply in the future, for example, isolated occurrence, changes in market factors such as public attitude to claiming, economic conditions, as well as internal factors, such as, portfolio mix, underwriting policy, policy conditions and claims handling procedures. Other key circumstances affecting the reliability of assumptions include delays in settlement and changes in foreign currency rates. Sensitivities The General claim liabilities are sensitive to the above key assumptions and change in these assumptions may impact the liabilities and operating surplus of the General Fund significantly. It has not been possible to quantify the sensitivity of certain assumptions, such as, legislative changes or uncertainty in the estimation process. The analysis below is performed for reasonably possible movements in key assumptions with all other assumptions held constant, showing the impact on gross and net liabilities and operating surplus. The correlation of assumptions will have a significant effect in determining the ultimate claims liabilities, but to demonstrate the impact due to changes in assumptions, assumptions had to be changed on an individual basis. It should be noted that movements in these assumptions are non-linear. The key assumptions to which the estimation of actuarial liabilities is particularly sensitive are as follows: - Fire loss ratio for latest accident year This is significant as Fire portfolio is one of the largest under general business, a change in loss ratio estimate will impact the liabilities significantly. - Motor Act loss ratio for latest accident year Motor Act business is long tailed in nature and need years before the claim experience matures. A significant impact may result if the ultimate experience differs from current estimation. - Average claim cost Reserves are based on assumption that historical average claim cost is reflective of the future experience. Increase in average cost will increase future liabilities.

223 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report risk management (continued) (b) General Fund (continued) Sensitivities (continued) - Average claim frequency Reserves are based on assumption that historical average claim number in each accident year reflects the future experience. A change in average number of claims will impact the future liabilities. - Average claim settlement period Reserves are based on assumption that claim settlement period will be stable over years. A change in claim handling practice will affect the claim cost and the future liabilities. Below shows the summary of changes in key assumptions and the impact to the gross and net claim liabilities, and the operating surplus. Group Change in assumptions Impact on gross liabilities Impact on net liabilities Impact on operating surplus 31 December 2012 Fire loss ratio for AY % 15,261 5,244 (5,244) Motor Act loss ratio for AY % 2,828 2,810 (2,810) Average claim cost +10% 56,393 29,231 (29,231) Average claim frequency +10% 28,896 21,291 (21,291) Average claim settlement period Increase by 6 months 11,270 7,934 (7,934) 31 December 2011 Fire loss ratio for AY % 10,949 4,647 (4,647) Motor Act loss ratio for AY % 2,466 2,466 (2,466) Average claim cost +10% 48,545 22,235 (22,235) Average claim frequency +10% 26,512 18,935 (18,935) Average claim settlement period Increase by 6 months 9,948 6,748 (6,748) 1 January 2011 Fire loss ratio for AY % 15,864 6,744 (6,744) Motor Act loss ratio for AY % 4,011 4,011 (4,011) Average claim cost +10% 43,505 19,832 (19,832) Average claim frequency +10% 23,058 16,018 (16,018) Average claim settlement period Increase by 6 months 8,000 5,417 (5,417)

224 222 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 36. risk management (continued) (b) General Fund (continued) Sensitivities (continued) Company Change in assumptions Impact on gross liabilities Impact on net liabilities Impact on operating surplus 31 December 2012 Fire loss ratio for AY % 13,734 4,642 (4,642) Motor Act loss ratio for AY % 2,815 2,798 (2,798) Average claim cost +10% 54,059 28,541 (28,541) Average claim frequency +10% 26,480 20,576 (20,576) Average claim settlement period Increase by 6 months 9,656 7,055 (7,055) 31 December 2011 Fire loss ratio for AY % 9,386 4,026 (4,026) Motor Act loss ratio for AY % 2,466 2,466 (2,466) Average claim cost +10% 46,280 21,423 (21,423) Average claim frequency +10% 24,166 18,094 (18,094) Average claim settlement period Increase by 6 months 8,381 5,678 (5,678) 1 January 2011 Fire loss ratio for AY % 13,819 5,931 (5,931) Motor Act loss ratio for AY % 4,011 4,011 (4,011) Average claim cost +10% 40,541 18,769 (18,769) Average claim frequency +10% 19,989 14,917 (14,917) Average claim settlement period Increase by 6 months 6,462 4,366 (4,366) Claims development table The following tables show the estimate of cumulative incurred claims, including both claims notified and IBNR for each successive accident year at the end of reporting period, together with cumulative payments to-date. In setting provisions for claims, the Group and the Company give consideration to the probability and magnitude of future experience being more adverse than assumed and exercise the degree of caution in setting reserves when there is considerable uncertainty. In general, the uncertainty associated with the ultimate claims experience in an accident year is greatest when the accident year is at an early stage of development and the margin necessary to provide the necessary confidence in adequacy of provision is relatively at its highest. As claims develop and the ultimate cost of claims becomes more certain, the relative level of margin maintained should decrease.

225 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report risk management (continued) (b) General Fund (continued) Gross General contract liabilities for 2012 (Group): Accident year Before Total At end of accident year 325, , , , , , , ,113 One year later 292, , , , , , ,803 - Two years later 287, , , , , , Three years later 285, , , , , Four years later 280, , , , Five years later 286, , , Six years later 289, , Seven years later 286, Current estimate of cumulative claims incurred 286, , , , , , , ,113 2,017,478 At end of accident year (279,625) (82,819) (63,455) (50,291) (71,393) (101,724) (58,326) (51,497) One year later (220,280) (190,943) (179,619) (109,315) (132,370) (174,690) (132,258) - Two years later (244,332) (217,611) (204,297) (142,410) (146,646) (205,770) - - Three years later (254,197) (229,294) (219,658) (152,230) (153,005) Four years later (262,051) (278,594) (227,646) (156,264) Five years later (275,634) (289,121) (233,071) Six years later (278,078) (290,324) Seven years later (278,596) Cumulative payments to-date (278,596) (290,324) (233,071) (156,264) (153,005) (205,770) (132,258) (51,497) (1,500,785) Gross General contract liabilities 7,985 7,346 23,958 26,402 33, , , , ,693 Additional risk margin 70,463 Effect of movement in exchange rates (2,647) Gross General contract liabilities per financial position (Note 17(a)) 584,509

226 224 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 36. risk management (continued) (b) General Fund (continued) Net General contract liabilities for 2012 (Group): Accident year Before Total At end of accident year 219,940 74, , , , , , ,228 One year later 218,365 87, ,800 86, , , ,927 - Two years later 221,825 85, ,551 92, , , Three years later 221,935 89, ,607 98, , Four years later 217,650 87, ,828 96, Five years later 220,968 88, , Six years later 221,554 88, Seven years later 219, Current estimate of cumulative claims incurred 219,046 88, ,362 96, , , , ,228 1,189,956 At end of accident year (232,044) (27,543) (47,717) (33,040) (44,099) (84,167) (53,570) (47,769) One year later (173,099) (57,372) (85,148) (60,702) (79,458) (143,180) (119,794) - Two years later (189,652) (65,805) (94,843) (74,740) (92,171) (158,560) - - Three years later (197,681) (71,801) (102,483) (84,233) (97,214) Four years later (203,838) (77,566) (107,236) (87,523) Five years later (212,309) (80,318) (114,486) Six years later (214,368) (81,929) Seven years later (214,809) Cumulative payments to-date (214,809) (81,929) (114,486) (87,523) (97,214) (158,560) (119,794) (47,769) (922,084) Net General contract liabilities 4,237 6,551 6,876 9,067 10,235 45, , , ,872 Additional risk margin 35,098 Effect of movement in exchange rates (940) Net General contract liabilities per financial position (Note 17(a)) 302,030

227 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report risk management (continued) (b) General Fund (continued) Gross General contract liabilities for 2012 (Company): Accident year Before Total At end of accident year 319, , , , , , , ,615 One year later 283, , , , , , ,454 - Two years later 273, , , , , , Three years later 267, , , , , Four years later 262, , , , Five years later 266, , , Six years later 268, , Seven years later 268, Current estimate of cumulative claims incurred 268, , , , , , , ,615 1,804,855 At end of accident year (274,552) (70,359) (50,179) (36,888) (37,036) (79,900) (48,450) (43,107) One year later (212,475) (175,243) (164,274) (94,478) (90,453) (148,043) (113,694) - Two years later (232,363) (199,717) (187,483) (127,247) (102,785) (178,214) - - Three years later (241,282) (210,770) (202,364) (135,664) (106,453) Four years later (247,804) (259,972) (209,324) (139,549) Five years later (260,905) (269,285) (214,730) Six years later (262,533) (270,510) Seven years later (263,056) Cumulative payments to-date (263,056) (270,510) (214,730) (139,549) (106,453) (178,214) (113,694) (43,107) (1,329,313) Gross General contract liabilities 4,981 2,921 20,739 23,018 33,186 99, , , ,542 Additional risk margin 69,847 Gross General contract liabilities per financial position (Note 17(a)) 545,389

228 226 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 36. risk management (continued) (b) General Fund (continued) Net General contract liabilities for 2012 (Company): Accident year Before Total At end of accident year 214,233 62,510 94,925 91,338 90, , , ,701 One year later 210,105 74, ,623 74,215 89, , ,938 - Two years later 208,750 71, ,978 76,563 93, , Three years later 205,493 72, ,230 81,426 85, Four years later 200,363 69,085 98,655 79, Five years later 202,334 67, , Six years later 202,156 67, Seven years later 201, Current estimate of cumulative claims incurred 201,532 67, ,183 79,913 85, , , ,701 1,046,325 At end of accident year (227,775) (17,925) (37,770) (22,618) (29,194) (68,055) (44,725) (40,054) One year later (166,276) (44,872) (73,387) (49,154) (62,390) (125,883) (104,575) - Two years later (178,662) (51,119) (81,612) (62,879) (73,271) (140,510) - - Three years later (185,786) (56,474) (88,771) (70,969) (76,033) Four years later (190,595) (62,130) (92,652) (74,198) Five years later (198,582) (63,703) (99,887) Six years later (199,827) (65,352) Seven years later (200,268) Cumulative payments to-date (200,268) (65,352) (99,887) (74,198) (76,033) (140,510) (104,575) (40,054) (800,877) Net General contract liabilities 1,264 2,130 4,296 5,715 9,712 44, , , ,448 Additional risk margin 34,487 Net General contract liabilities per financial position (Note 17(a)) 279,935

229 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Financial instruments 37.1 Categories of financial instruments the table below provides an analysis of financial instruments categorised as follows: (a) Loans and receivables (LAR); (b) Fair value through profit or loss (FVTPL) - Held for trading (HFT); (c) Available-for-sale financial assets (AFS); (d) Held-to-maturity financial assets (HTM); and (e) Financial liabilities measured at amortised cost (FL). Operator Family General Group 31 December 2012 Financial assets Loans and receivables Retakaful assets - 3, , ,743 Loans and receivables, excluding takaful receivables 128, , , ,123 receivables - 68,472 25,541 94,013 Cash and cash equivalents 102, ,172 61, , , , ,961 1,390,131 FVTPL financial assets Other investments , ,299 AFS financial assets Other investments 391,994 3,012, ,764 3,928,857 HTM financial assets Other investments 1, ,271 35, ,431 Financial liabilities - Other financial liabilities measured at amortised cost Qardh payables - 10,398 23,888 - Provision for outstanding claims - 28, , ,944 payables - 20,501 22,625 43,126 Other payables 84, ,434 61, ,013 84, , , ,083

230 228 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 37. Financial instruments (continued) 37.1 Categories of financial instruments (continued) Operator Family General Group 31 December 2011 Financial assets Loans and receivables Retakaful assets - 1, , ,653 Loans and receivables, excluding takaful receivables 174, , , ,701 receivables - 62,352 47, ,814 Qardh receivables Cash and cash equivalents 61, ,492 47, , , , ,104 1,601,695 FVTPL financial assets Other investments - 174, ,392 AFS financial assets Other investments 264,293 2,554, ,623 3,254,122 HTM financial assets Other investments 4, ,931 34, ,579 Financial liabilities - Other financial liabilities measured at amortised cost Qardh payables - 11,398 20,798 - Provision for outstanding claims - 30, , ,879 payables - 19,496 26,041 45,537 Other payables 65, ,119 52, ,357 65, , , ,773

231 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Financial instruments (continued) 37.1 Categories of financial instruments (continued) Operator Family General Group 1 January 2011 Financial assets Loans and receivables Retakaful assets - 1, , ,089 Loans and receivables, excluding takaful receivables 187, , , ,069 receivables - 43,657 63, ,222 Qardh receivables 1, Cash and cash equivalents 75, ,678 69, , , , ,953 1,461,255 FVTPL financial assets Other investments - 184, ,571 AFS financial assets Other investments 169,502 2,442, ,691 3,014,585 HTM financial assets Other investments 2, ,666 34, ,106 Financial liabilities - Other financial liabilities measured at amortised cost Qardh payables - 12,173 19,074 - Provision for outstanding claims - 26, , ,047 payables - 15,217 35,237 50,454 Other payables 35, ,406 66, ,124 35, , , ,625

232 230 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 37. Financial instruments (continued) 37.1 Categories of financial instruments (continued) Operator Family General Company 31 December 2012 Financial assets Loans and receivables Retakaful assets - 2, , ,473 Loans and receivables, excluding takaful receivables 108, , , ,343 receivables - 62,893 17,605 80,498 Cash and cash equivalents 49, ,248 42, , , , ,183 1,175,094 FVTPL financial assets Other investments - 113, ,682 AFS financial assets Other investments 384,209 2,922, ,442 3,829,204 HTM financial assets Other investments - 241,908 32, ,630 Financial liabilities - Other financial liabilities measured at amortised cost Provision for outstanding claims - 25, , ,400 payables - 15,318 20,505 35,823 Other payables 72, ,157 60, ,778 72, , , ,001

233 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Financial instruments (continued) 37.1 Categories of financial instruments (continued) Operator Family General Company 31 December 2011 Financial assets Loans and receivables Retakaful assets , ,775 Loans and receivables, excluding takaful receivables 135, , , ,545 receivables - 54,355 31,496 85,851 Cash and cash equivalents 27, ,447 32, , , , ,392 1,354,170 FVTPL financial assets Other investments - 108, ,913 AFS financial assets Other investments 255,631 2,475, ,609 3,165,939 HTM financial assets Other investments - 241,904 32, ,670 Financial liabilities - Other financial liabilities measured at amortised cost Provision for outstanding claims - 26, , ,195 payables - 15,930 23,522 39,452 Other payables 55, ,245 46, ,166 55, , , ,813

234 232 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 37. Financial instruments (continued) 37.1 Categories of financial instruments (continued) Operator Family General Company 1 January 2011 Financial assets Loans and receivables Retakaful assets , ,148 Loans and receivables, excluding takaful receivables 157, , , ,689 receivables - 35,292 42,415 77,707 Cash and cash equivalents 27, ,266 50, , , , ,033 1,193,527 FVTPL financial assets Other investments - 120, ,170 AFS financial assets Other investments 163,377 2,374, ,687 2,939,754 HTM financial assets Other investments - 241,905 32, ,714 Financial liabilities - Other financial liabilities measured at amortised cost Provision for outstanding claims - 24, , ,518 payables - 12,233 31,096 43,329 Other payables 22, ,373 62, ,870 22, , , ,717

235 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Financial instruments (continued) 37.2 Net gains and losses arising from use of financial instruments Note Operator Family General Group to Net gains/(losses) arising on: FVTPL financial assets - recognised in profit or loss - 20,846-20,846 AFS financial assets - recognised in other comprehensive income 7(d) 3, ,844 - recognised in participants fund 17(c) - (13,384) 1,084 (12,300) - recognised in profit or loss 21, ,834 35, ,306 25, ,450 36, ,850 HTM financial assets ,838 1,416 12,720 LAR 3,022 23,491 8,225 38,280 28, ,625 46, , to Net gains/(losses) arising on: FVTPL financial assets - recognised in profit or loss - 9,749-9,749 AFS financial assets - recognised in other comprehensive income 7(d) (3,580) - - (3,580) - recognised in participants fund 17(c) - 5,370 (9,285) (3,915) - recognised in profit or loss 13, ,039 35, ,391 10, ,409 26, ,896 HTM financial assets 29 7, ,207 LAR 7,460 28,816 28,199 66,522 17, ,426 55, ,625

236 234 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 37. Financial instruments (continued) 37.2 Net gains and losses arising from use of financial instruments (continued) Note Operator Family General Company to Net gains/(losses) arising on: FVTPL financial assets - recognised in profit or loss - 8,727-8,727 AFS financial assets - recognised in other comprehensive income 7(d) 3, ,754 - recognised in participants fund 17(c) - (12,938) 1,021 (11,917) - recognised in profit or loss 20, ,614 35, ,317 24, ,676 36, ,154 HTM financial assets - 10,838 1,235 12,073 LAR 4,300 19,215 7,542 31,057 29, ,456 45, , to Net gains/(losses) arising on: FVTPL financial assets - recognised in profit or loss - 7,133-7,133 AFS financial assets - recognised in other comprehensive income 7(d) (3,444) - - (3,444) - recognised in participants fund 17(c) - 8,118 (9,218) (1,100) - recognised in profit or loss 12, ,067 35, ,009 9, ,185 26, ,465 HTM financial assets 29 7, ,207 LAR 6,477 24,238 24,138 54,853 15, ,757 51, ,658

237 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Financial instruments (continued) 37.3 Financial risk management The Group and the Company have exposure to the following risks arising from its use of financial instruments: - Credit risk - Liquidity risk - Market risk (currency risk, profit rate risk, price risk) - Operational risk 37.4 Credit risk Credit risk is the potential financial loss resulting from the failure of a customer, an intermediary or counterparty to settle its financial and contractual obligations to the Group and the Company as and when they fall due. The Group s and the Company s portfolio of Islamic debt securities, and to a lesser extent short-term and other investments, are subject to credit risk. This risk is defined as the potential loss resulting from adverse changes in a borrower s ability to repay the debt. The Group s and the Company s objective is to earn competitive relative returns by investing in a diversified portfolio of securities. Management has an investment credit risk policy in place. Limits are established to manage credit quality and concentration risk. The Group and the Company have takaful and other receivables balances that are subject to credit risk. Among the most significant of these are retakaful recoveries. To mitigate the risk of the counterparties not paying the amount due, the Group and the Company have established certain business and financial guidelines for retakaful approval, incorporating ratings by major agencies and considering currently available market information. The Group and the Company also periodically review the financial stability of retakaful companies from public and other sources and the settlement trend of amounts due from retakaful companies. Cash and deposits are generally placed with banks and financial institutions licensed under the Banking and Financial Institutions Act 1989 and the Islamic Banking Act 1983 which are regulated by Bank Negara Malaysia. The Group and the Company manage individual exposures as well as concentration of credit risks. At end of the reporting period, there were no significant concentration of credit risks, other than investments in Islamic debts securities issued by single issuer amounted to RM296,001,250 (2011: RM118,169,600).

238 236 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 37. Financial instruments (continued) 37.4 Credit risk (continued) Credit exposure the table below shows the maximum exposure to credit risk for the components recognised in the statements of financial position. Operator Family General Group 31 December 2012 AFS financial assets Islamic debt securities 200,588 1,768, ,051 2,305,807 Malaysian Government Islamic papers 20, ,388 93, ,459 FVTPL financial assets Islamic debt securities ,340-58,974 HTM financial assets Islamic debt securities 1, ,490 2, ,928 Malaysian Government Islamic papers - 112,781 32, ,503 LAR Retakaful assets - 3, , ,743 Loans and receivables, excluding takaful receivables 128, , , ,123 receivables - 68,472 25,541 94,013 Cash and cash equivalents 102, ,172 61, , ,105 3,431, ,503 4,709,802

239 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Financial instruments (continued) 37.4 Credit risk (continued) Credit exposure (continued) Operator Family General Group 31 December 2011 AFS financial assets Islamic debt securities 111,372 1,502, ,341 1,901,555 Malaysian Government Islamic papers 10, ,315 89, ,706 FVTPL financial assets Islamic debt securities - 23,517-23,517 HTM financial assets Islamic debt securities 4, ,088 1, ,970 Malaysian Government Islamic papers - 112,843 32, ,609 LAR Retakaful assets - 1, , ,653 Loans and receivables, excluding takaful receivables 174, , , ,701 receivables - 62,352 47, ,814 Qardh receivables Cash and cash equivalents 61, ,492 47, , ,303 3,194, ,041 4,428,052

240 238 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 37. Financial instruments (continued) 37.4 Credit risk (continued) Operator Family General Group 1 January 2011 AFS financial assets Islamic debt securities 43,307 1,493, ,117 1,794,226 Malaysian Government Islamic papers - 465,994 88, ,450 FVTPL financial assets Islamic debt securities - 21,571-21,571 HTM financial assets Islamic debt securities 2, ,763 1, ,394 Malaysian Government Islamic papers - 112,903 32, ,712 LAR Retakaful assets - 1, , ,089 Loans and receivables, excluding takaful receivables 187, , , ,069 receivables - 43,657 63, ,222 Qardh receivables 1, Cash and cash equivalents 75, ,678 69, , ,910 2,997, ,050 4,127,608

241 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Financial instruments (continued) 37.4 Credit risk (continued) Operator Family General Company 31 December 2012 AFS financial assets Islamic debt securities 199,576 1,758, ,051 2,295,190 Malaysian Government Islamic papers 20, ,388 93, ,459 FVTPL financial assets Islamic debt securities - 14,267-14,267 HTM financial assets Islamic debt securities - 129, ,127 Malaysian Government Islamic papers - 112,781 32, ,503 LAR Retakaful assets - 2, , ,473 Loans and receivables, excluding takaful receivables 108, , , ,343 receivables - 62,893 17,605 80,498 Cash and cash equivalents 49, ,248 42, , ,935 3,267, ,872 4,423,640

242 240 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 37. Financial instruments (continued) 37.4 Credit risk (continued) Operator Family General Company 31 December 2011 AFS financial assets Islamic debt securities 108,506 1,473, ,341 1,869,423 Malaysian Government Islamic papers 10, ,315 89, ,706 FVTPL financial assets Islamic debt securities - 15,260-15,260 HTM financial assets Islamic debt securities - 129, ,061 Malaysian Government Islamic papers - 112,843 32, ,609 LAR Retakaful assets , ,775 Loans and receivables, excluding takaful receivables 135, , , ,545 receivables - 54,355 31,496 85,851 Cash and cash equivalents 27, ,447 32, , ,982 3,015, ,599 4,105,229 1 January 2011 AFS financial assets Islamic debt securities 43,307 1,452, ,117 1,752,426 Malaysian Government Islamic papers - 465,994 88, ,450 FVTPL financial assets Islamic debt securities - 14,038-14,038 HTM financial assets Islamic debt securities - 129, ,002 Malaysian Government Islamic papers - 112,903 32, ,712 LAR Retakaful assets , ,148 Loans and receivables, excluding takaful receivables 157, , , ,689 receivables - 35,292 42,415 77,707 Cash and cash equivalents 27, ,266 50, , ,995 2,830, ,415 3,789,155

243 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Financial instruments (continued) 37.4 Credit risk (continued) Credit exposure by credit rating the table below provides information regarding the credit risk exposure of the Group and the Company by classifying assets according to the Group s and the Company s internal credit ratings of counterparties. Group Neither past-due nor impaired Past-due but not impaired Impaired Total 31 December 2012 Operator AFS financial assets Islamic debt securities 200, ,588 Malaysian Government Islamic papers 20, ,155 FVTPL financial assets Islamic debt securities HTM financial assets Islamic debt securities ,585 LAR Loans and receivables, excluding takaful receivables 128,171-1, ,424 Qardh receivables ,286 34,286 Cash and cash equivalents 102, , , , ,644

244 242 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 37. Financial instruments (continued) 37.4 Credit risk (continued) Credit exposure by credit rating (continued) Group Neither past-due nor impaired Past-due but not impaired Impaired Total 31 December 2012 Family AFS financial assets Islamic debt securities 1,768, ,768,168 Malaysian Government Islamic papers 550, ,388 FVTPL financial assets Islamic debt securities 58, ,340 HTM financial assets Islamic debt securities 140, ,490 Malaysian Government Islamic papers 112, ,781 LAR Retakaful assets 3, ,707 Loans and receivables, excluding takaful receivables 441, ,422 receivables 61,098 7,374 3,901 72,373 Cash and cash equivalents 288, ,172 3,424,265 7,374 4,202 3,435,841

245 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Financial instruments (continued) 37.4 Credit risk (continued) Credit exposure by credit rating (continued) Group Neither past-due nor impaired Past-due but not impaired Impaired Total 31 December 2012 General AFS financial assets Islamic debt securities 337, ,051 Malaysian Government Islamic papers 93, ,916 HTM financial assets Malaysian Government Islamic papers 32, ,722 LAR Retakaful assets 221, ,036 Loans and receivables, excluding takaful receivables 116, ,657 receivables 16,310 9,231 6,982 32,523 Cash and cash equivalents 61, , ,272 9,231 7, ,866 Group AFS financial assets Islamic debt securities 2,305, ,305,807 Malaysian Government Islamic papers 664, ,459 FVTPL financial assets Islamic debt securities 58, ,974 HTM financial assets Islamic debt securities 144, ,928 Malaysian Government Islamic papers 145, ,503 LAR Retakaful assets 224, ,743 Loans and receivables, excluding takaful receivables 619,123-1, ,058 receivables 77,408 16,605 10, ,896 Cash and cash equivalents 452, ,252 4,692,563 17,239 12,818 4,722,620

246 244 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 37. Financial instruments (continued) 37.4 Credit risk (continued) Credit exposure by credit rating (continued) Group Neither past-due nor impaired Past-due but not impaired Impaired Total 31 December 2011 Operator AFS financial assets Islamic debt securities 111, ,372 Malaysian Government Islamic papers 10, ,291 HTM financial assets Islamic debt securities 4, ,152 LAR Loans and receivables, excluding takaful receivables 174,946-2, ,048 Qardh receivables ,919 32,196 Cash and cash equivalents 61, , ,303-34, ,324 Family AFS financial assets Islamic debt securities 1,502, ,502,842 Malaysian Government Islamic papers 492, ,315 FVTPL financial assets Islamic debt securities 23, ,517 HTM financial assets Islamic debt securities 158, ,088 Malaysian Government Islamic papers 112, ,843 LAR Retakaful assets 1, ,279 Loans and receivables, excluding takaful receivables 563, ,613 receivables 53,131 9,221 5,567 67,919 Cash and cash equivalents 277, ,492 3,185,176 9,221 6,511 3,200,908

247 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Financial instruments (continued) 37.4 Credit risk (continued) Credit exposure by credit rating (continued) Group Neither past-due nor impaired Past-due but not impaired Impaired Total 31 December 2011 General AFS financial assets Islamic debt securities 287, ,341 Malaysian Government Islamic papers 89, ,100 HTM financial assets Islamic debt securities 1, ,730 Malaysian Government Islamic papers 32, ,766 LAR Retakaful assets 215, ,374 Loans and receivables, excluding takaful receivables 175,498-1, ,522 receivables 37,916 9,546 9,522 56,984 Cash and cash equivalents 47, , ,495 9,546 10, ,587 Group AFS financial assets Islamic debt securities 1,901, ,901,555 Malaysian Government Islamic papers 591, ,706 FVTPL financial assets Islamic debt securities 23, ,517 HTM financial assets Islamic debt securities 163, ,970 Malaysian Government Islamic papers 145, ,609 LAR Retakaful assets 216, ,653 Loans and receivables, excluding takaful receivables 888,701-4, ,771 receivables 91,047 18,767 15, ,903 Cash and cash equivalents 386, ,527 4,409,285 18,767 19,159 4,447,211

248 246 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 37. Financial instruments (continued) 37.4 Credit risk (continued) Credit exposure by credit rating (continued) Group Neither past-due nor impaired Past-due but not impaired Impaired Total 1 January 2011 Operator AFS financial assets Islamic debt securities 43, ,307 HTM financial assets Islamic debt securities 2, ,916 LAR Loans and receivables, excluding takaful receivables 187,328-2, ,251 Qardh receivables 1,357-29,890 31,247 Cash and cash equivalents 75, , ,910-32, ,723 Family Fund AFS financial assets Islamic debt securities 1,493, ,493,802 Malaysian Government Islamic papers 465, ,994 FVTPL financial assets Islamic debt securities 21, ,571 HTM financial assets Islamic debt securities 145, ,763 Malaysian Government Islamic papers 112, ,903 LAR Retakaful assets 1, ,080 Loans and receivables, excluding takaful receivables 468,382-2, ,368 receivables 42, ,434 53,091 Cash and cash equivalents 244, ,678 2,996, ,420 3,010,250

249 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Financial instruments (continued) 37.4 Credit risk (continued) Credit exposure by credit rating (continued) Group Neither past-due nor impaired Past-due but not impaired Impaired Total 1 January 2011 General AFS financial assets Islamic debt securities 257, ,117 Malaysian Government Islamic papers 88, ,456 HTM financial assets Islamic debt securities 1, ,715 Malaysian Government Islamic papers 32, ,809 LAR Retakaful assets 211, ,009 Loans and receivables, excluding takaful receivables 141,184-3, ,250 receivables 62,432 1,133 26,719 90,284 Cash and cash equivalents 69, , ,917 1,133 29, ,835 Group AFS financial assets Islamic debt securities 1,794, ,794,226 Malaysian Government Islamic papers 554, ,450 FVTPL financial assets Islamic debt securities 21, ,571 HTM financial assets Islamic debt securities 150, ,394 Malaysian Government Islamic papers 145, ,712 LAR Retakaful assets 212, ,089 Loans and receivables, excluding takaful receivables 753,069-8, ,044 receivables 105,140 2,082 36, ,375 Cash and cash equivalents 388, ,875 4,125,526 2,082 45,128 4,172,736

250 248 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 37. Financial instruments (continued) 37.4 Credit risk (continued) Credit exposure by credit rating (continued) Company Neither past-due nor impaired Past-due but not impaired Impaired Total 31 December 2012 Operator AFS financial assets Islamic debt securities 199, ,576 Malaysian Government Islamic papers 20, ,155 LAR Loans and receivables, excluding takaful receivables 108,187-1, ,440 Cash and cash equivalents 49, , ,935-1, ,188 Family AFS financial assets Islamic debt securities 1,758, ,758,563 Malaysian Government Islamic papers 550, ,388 FVTPL financial assets Islamic debt securities 14, ,267 HTM financial assets Islamic debt securities 129, ,127 Malaysian Government Islamic papers 112, ,781 LAR Retakaful assets 2, ,854 Loans and receivables, excluding takaful receivables 425, ,375 receivables 55,883 7,010 3,850 66,743 Cash and cash equivalents 211, ,248 3,260,185 7,010 4,151 3,271,346

251 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Financial instruments (continued) 37.4 Credit risk (continued) Credit exposure by credit rating (continued) Company Neither past-due nor impaired Past-due but not impaired Impaired Total 31 December 2012 General AFS financial assets Islamic debt securities 337, ,051 Malaysian Government Islamic papers 93, ,916 HTM financial assets Malaysian Government Islamic papers 32, ,722 LAR Retakaful assets 204, ,619 Loans and receivables, excluding takaful receivables 105, ,825 receivables 11,516 6,089 6,901 24,506 Cash and cash equivalents 42, , ,783 6,089 7, ,154 Company AFS financial assets Islamic debt securities 2,295, ,295,190 Malaysian Government Islamic papers 664, ,459 FVTPL financial assets Islamic debt securities 14, ,267 HTM financial assets Islamic debt securities 129, ,127 Malaysian Government Islamic papers 145, ,502 LAR Retakaful assets 207, ,473 Loans and receivables, excluding takaful receivables 584,343-1, ,278 receivables 67,399 13,099 10,751 91,249 Cash and cash equivalents 302, ,780 4,410,541 13,099 12,686 4,436,326

252 250 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 37. Financial instruments (continued) 37.4 Credit risk (continued) Credit exposure by credit rating (continued) Company Neither past-due nor impaired Past-due but not impaired Impaired Total 31 December 2011 Operator AFS financial assets Islamic debt securities 108, ,506 Malaysian Government Islamic papers 10, ,291 LAR Loans and receivables, excluding takaful receivables 135,374-1, ,197 Cash and cash equivalents 27, , ,982-1, ,805 Family AFS financial assets Islamic debt securities 1,473, ,473,576 Malaysian Government Islamic papers 492, ,315 FVTPL financial assets Islamic debt securities 15, ,260 HTM financial assets Islamic debt securities 129, ,061 Malaysian Government Islamic papers 112, ,843 LAR Retakaful assets Loans and receivables, excluding takaful receivables 548, ,461 receivables 47,527 6,828 5,441 59,796 Cash and cash equivalents 188, ,447 3,008,242 6,828 6,385 3,021,455

253 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Financial instruments (continued) 37.4 Credit risk (continued) Credit exposure by credit rating (continued) Company Neither past-due nor impaired Past-due but not impaired Impaired Total 31 December 2011 General AFS financial assets Islamic debt securities 287, ,341 Malaysian Government Islamic papers 89, ,100 HTM financial assets Malaysian Government Islamic papers 32, ,766 LAR Retakaful assets 190, ,079 Loans and receivables, excluding takaful receivables 164,076-1, ,100 receivables 27,164 4,332 9,444 40,940 Cash and cash equivalents 32, , ,267 4,332 10, ,067 Company AFS financial assets Islamic debt securities 1,869, ,869,423 Malaysian Government Islamic papers 591, ,706 FVTPL financial assets Islamic debt securities 15, ,260 HTM financial assets Islamic debt securities 129, ,061 Malaysian Government Islamic papers 145, ,609 LAR Retakaful assets 190, ,775 Loans and receivables, excluding takaful receivables 828,545-3, ,336 receivables 74,691 11,160 14, ,736 Cash and cash equivalents 248, ,999 4,094,069 11,160 18,676 4,123,905

254 252 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 37. Financial instruments (continued) 37.4 Credit risk (continued) Credit exposure by credit rating (continued) Company Neither past-due nor impaired Past-due but not impaired Impaired Total 1 January 2011 Operator AFS financial assets Islamic debt securities 43, ,307 LAR Loans and receivables, excluding takaful receivables 157,986-2, ,630 Cash and cash equivalents 27, , ,995-2, ,639 Family AFS financial assets Islamic debt securities 1,452, ,452,002 Malaysian Government Islamic papers 465, ,994 FVTPL financial assets Islamic debt securities 14, ,038 HTM financial assets Islamic debt securities 129, ,002 Malaysian Government Islamic papers 112, ,903 LAR Retakaful assets Loans and receivables, excluding takaful receivables 456,930-2, ,916 receivables 34, ,976 43,268 Cash and cash equivalents 164, ,266 2,829, ,962 2,841,655

255 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Financial instruments (continued) 37.4 Credit risk (continued) Credit exposure by credit rating (continued) Company Neither past-due nor impaired Past-due but not impaired Impaired Total 1 January 2011 General AFS financial assets Islamic debt securities 257, ,117 Malaysian Government Islamic papers 88, ,456 HTM financial assets Malaysian Government Islamic papers 32, ,809 LAR Retakaful assets 154, ,882 Loans and receivables, excluding takaful receivables 140,721-3, ,787 receivables 41,282 1,133 23,047 65,462 Cash and cash equivalents 50, , ,282 1,133 26, ,528 Company AFS financial assets Islamic debt securities 1,752, ,752,426 Malaysian Government Islamic papers 554, ,450 FVTPL financial assets Islamic debt securities 14, ,038 HTM financial assets Islamic debt securities 129, ,002 Malaysian Government Islamic papers 145, ,712 LAR Retakaful assets 155, ,148 Loans and receivables, excluding takaful receivables 718,689-8, ,385 receivables 75,625 2,082 31, ,730 Cash and cash equivalents 241, ,983 3,787,073 2,082 39,719 3,828,874

256 254 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 37. Financial instruments (continued) 37.4 Credit risk (continued) Credit exposure by credit rating (continued) The table below provides information regarding the credit risk exposure of the Group and of the Company by classifying assets according to the Rating Agency of Malaysia s (RAM) credit ratings of counterparties. AAA is the highest possible rating. Assets that fall outside the range of AAA to A are classified as speculative grade. Group AAA AA A Not-rated Unit-linked Total 31 December 2012 Operator AFS financial assets Islamic debt securities 64, ,922-1, ,588 Malaysian Government Islamic papers ,155* - 20,155 FVTPL financial assets Islamic debt securities HTM financial assets Islamic debt securities ,585-1,585 LAR Loans and receivables, excluding takaful receivables - 25,767 8,611 93, ,171 Cash and cash equivalents 11,837 35,380 29,550 26, ,972 76, ,069 38, , ,105 * Malaysian Government Islamic papers are not rated by RAM but instead is rated A- based on Malaysia sovereign rating accorded by Standard & Poor.

257 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Financial instruments (continued) 37.4 Credit risk (continued) Credit exposure by credit rating (continued) Group AAA AA A Not-rated Unit-linked Total 31 December 2012 Family AFS financial assets Islamic debt securities 649, ,169 12, ,905-1,768,168 Malaysian Government Islamic papers ,388* - 550,388 FVTPL financial assets Islamic debt securities ,340 58,340 HTM financial assets Islamic debt securities ,501 91, ,490 Malaysian Government Islamic papers ,781* - 112,781 LAR Retakaful assets ,707-3,707 Loans and receivables, excluding takaful receivables ,270 76, ,589 1, ,121 receivables ,137-68,472 Cash and cash equivalents 78,279 52,360 30, ,041 15, , , , ,976 1,545,537 74,680 3,431,639 * Malaysian Government Islamic papers are not rated by RAM but instead is rated A- based on Malaysia sovereign rating accorded by Standard & Poor.

258 256 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 37. Financial instruments (continued) 37.4 Credit risk (continued) Credit exposure by credit rating (continued) Group AAA AA A Not-rated Unit-linked Total 31 December 2012 General AFS financial assets Islamic debt securities 104, ,123 1,777 37, ,051 Malaysian Government Islamic papers ,916* - 93,916 HTM financial assets Islamic debt securities ,853-2,853 Malaysian Government Islamic papers ,722* - 32,722 LAR Retakaful assets , ,036 Loans and receivables, excluding takaful receivables - 10,411 28,811 77, ,276 receivables ,014 24,321-25,541 Cash and cash equivalents 9,606 19,488 12,025 19,989-61, , ,228 43, , ,503 * Malaysian Government Islamic papers are not rated by RAM but instead is rated A- based on Malaysia sovereign rating accorded by Standard & Poor.

259 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Financial instruments (continued) 37.4 Credit risk (continued) Credit exposure by credit rating (continued) Group AAA AA A Not-rated Unit-linked Total 31 December 2012 Group AFS financial assets Islamic debt securities 818,723 1,148,214 14, ,656-2,305,807 Malaysian Government Islamic papers ,459* - 664,459 FVTPL financial assets Islamic debt securities ,340 58,974 HTM financial assets Islamic debt securities ,501 96, ,928 Malaysian Government Islamic papers ,503* - 145,503 LAR Retakaful assets , ,743 Loans and receivables, excluding takaful receivables , , ,991 1, ,123 receivables ,338 92,458-94,013 Cash and cash equivalents 99, ,228 71, ,235 15, , ,145 1,334, ,764 2,132,106 74,680 4,709,802 * Malaysian Government Islamic papers are not rated by RAM but instead is rated A- based on Malaysia sovereign rating accorded by Standard & Poor.

260 258 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 37. Financial instruments (continued) 37.4 Credit risk (continued) Credit exposure by credit rating (continued) Group AAA AA A Not-rated Unit-linked Total 31 December 2011 Operator AFS financial assets Islamic debt securities 19,820 68,434-23, ,372 Malaysian Government Islamic papers ,291* - 10,291 HTM financial assets Islamic debt securities ,152-4,152 LAR Loans and receivables, excluding takaful receivables - 32,794 65,794 76, ,946 Qardh receivables Cash and cash equivalents 6,529 18,828 2,405 33,503-61,265 26, ,056 68, , ,303 * Malaysian Government Islamic papers are not rated by RAM but instead is rated A- based on Malaysia sovereign rating accorded by Standard & Poor.

261 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Financial instruments (continued) 37.4 Credit risk (continued) Credit exposure by credit rating (continued) Group AAA AA A Not-rated Unit-linked Total 31 December 2011 Family AFS financial assets Islamic debt securities 562, ,476 23, ,242-1,502,842 Malaysian Government Islamic papers ,315* - 492,315 FVTPL financial assets Islamic debt securities ,517 23,517 HTM financial assets Islamic debt securities 48, , ,088 Malaysian Government Islamic papers ,843* - 112,843 LAR Retakaful assets ,279-1,279 Loans and receivables, excluding takaful receivables 14,393 80, , , ,669 receivables , ,352 Cash and cash equivalents 41, ,191 7,264 87,358 11, , , , ,461 1,334,464 36,510 3,194,397 * Malaysian Government Islamic papers are not rated by RAM but instead is rated A- based on Malaysia sovereign rating accorded by Standard & Poor.

262 260 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 37. Financial instruments (continued) 37.4 Credit risk (continued) Credit exposure by credit rating (continued) Group AAA AA A Not-rated Unit-linked Total 31 December 2011 General AFS financial assets Islamic debt securities 109, ,440 1,963 28, ,341 Malaysian Government Islamic papers ,100* - 89,100 HTM financial assets Islamic debt securities ,730-1,730 Malaysian Government Islamic papers ,766* - 32,766 LAR Retakaful assets , ,374 Loans and receivables, excluding takaful receivables 4,701 24,103 98,840 47, ,498 receivables ,462-47,462 Cash and cash equivalents 8,227 18,492 6,022 15,029-47, , , , , ,041 * Malaysian Government Islamic papers are not rated by RAM but instead is rated A- based on Malaysia sovereign rating accorded by Standard & Poor.

263 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Financial instruments (continued) 37.4 Credit risk (continued) Credit exposure by credit rating (continued) Group AAA AA A Not-rated Unit-linked Total 31 December 2011 Group AFS financial assets Islamic debt securities 691, ,350 25, ,598-1,901,555 Malaysian Government Islamic papers ,706* - 591,706 FVTPL financial assets Islamic debt securities ,517 23,517 HTM financial assets Islamic debt securities 48, , ,970 Malaysian Government Islamic papers ,609* - 145,609 LAR Retakaful assets , ,653 Loans and receivables, excluding takaful receivables 19, , , , ,701 receivables , ,814 Cash and cash equivalents 55, ,511 15, ,890 11, , ,040 1,207, ,485 1,934,027 36,510 4,428,052

264 262 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 37. Financial instruments (continued) 37.4 Credit risk (continued) Credit exposure by credit rating (continued) Group AAA AA A Not-rated Unit-linked Total 1 January 2011 Operator AFS financial assets Islamic debt securities 20,140 23, ,307 HTM financial assets Islamic debt securities ,916-2,916 LAR Loans and receivables, excluding takaful receivables - 60,117 49,215 77, ,328 Qardh receivables ,357-1,357 Cash and cash equivalents 640 6,922 10,090 57,350-75,002 20,780 90,206 59, , ,910

265 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Financial instruments (continued) 37.4 Credit risk (continued) Credit exposure by credit rating (continued) Group AAA AA A Not-rated Unit-linked Total 1 January 2011 Family AFS financial assets Islamic debt securities 429, ,406 24, ,838-1,493,802 Malaysian Government Islamic papers ,994* - 465,994 FVTPL financial assets Islamic debt securities ,571 21,571 HTM financial assets Islamic debt securities 48, , ,763 Malaysian Government Islamic papers ,903* - 112,903 LAR Retakaful assets ,080-1,080 Loans and receivables, excluding takaful receivables 24,714 78, , ,097 4, ,382 receivables ,657-43,657 Cash and cash equivalents 17,976 45,215 89,983 79,743 11, , , , ,100 1,245,723 38,051 2,997,830 * Malaysian Government Islamic papers are not rated by RAM but instead is rated A- based on Malaysia sovereign rating accorded by Standard & Poor.

266 264 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 37. Financial instruments (continued) 37.4 Credit risk (continued) Credit exposure by credit rating (continued) Group AAA AA A Not-rated Unit-linked Total 1 January 2011 General AFS financial assets Islamic debt securities 92, ,738 1,990 48, ,117 Malaysian Government Islamic papers ,456* - 88,456 HTM financial assets Islamic debt securities ,715-1,715 Malaysian Government Islamic papers ,809* - 32,809 LAR Retakaful assets , ,009 Loans and receivables, excluding takaful receivables 8,260 41,836 63,116 27, ,184 receivables ,565-63,565 Cash and cash equivalents 4,380 23,879 16,094 24,842-69, , ,453 81, , ,050 * Malaysian Government Islamic papers are not rated by RAM but instead is rated A- based on Malaysia sovereign rating accorded by Standard & Poor.

267 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Financial instruments (continued) 37.4 Credit risk (continued) Credit exposure by credit rating (continued) Group AAA AA A Not-rated Unit-linked Total 1 January 2011 Group AFS financial assets Islamic debt securities 541, ,311 26, ,867-1,794,226 Malaysian Government Islamic papers ,450* - 554,450 FVTPL financial assets Islamic debt securities ,571 21,571 HTM financial assets Islamic debt securities 48, , ,394 Malaysian Government Islamic papers ,712* - 145,712 LAR Retakaful assets , ,089 Loans and receivables, excluding takaful receivables 32, , , ,240 4, ,069 receivables , ,222 Cash and cash equivalents 22,996 76, , ,935 11, , ,123 1,194, ,605 1,838,557 38,051 4,127,608 * Malaysian Government Islamic papers are not rated by RAM but instead is rated A- based on Malaysia sovereign rating accorded by Standard & Poor.

268 266 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 37. Financial instruments (continued) 37.4 Credit risk (continued) Credit exposure by credit rating (continued) Company AAA AA A Not-rated Unit-linked Total 31 December 2012 Operator AFS financial assets Islamic debt securities 64, , ,576 Malaysian Government Islamic papers ,155* - 20,155 LAR Loans and receivables, excluding takaful receivables - 25,767 8,611 73, ,187 Cash and cash equivalents 11,829 35,137 2, ,017 76, ,826 10,615 94, ,935 * Malaysian Government Islamic papers are not rated by RAM but instead is rated A- based on Malaysia sovereign rating accorded by Standard & Poor.

269 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Financial instruments (continued) 37.4 Credit risk (continued) Credit exposure by credit rating (continued) Company AAA AA A Not-rated Unit-linked Total 31 December 2012 Family AFS financial assets Islamic debt securities 649, ,169 12, ,300-1,758,563 Malaysian Government Islamic papers ,388* - 550,388 FVTPL financial assets Islamic debt securities ,267 14,267 HTM financial assets Islamic debt securities ,501 80, ,127 Malaysian Government Islamic papers ,781* - 112,781 LAR Retakaful assets ,854-2,854 Loans and receivables, excluding takaful receivables ,270 70, ,136 1, ,074 receivables ,558-62,893 Cash and cash equivalents 78,270 52,101 25,349 46,266 9, , , , ,529 1,1441,909 24,579 3,267,195 * Malaysian Government Islamic papers are not rated by RAM but instead is rated A- based on Malaysia sovereign rating accorded by Standard & Poor.

270 268 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 37. Financial instruments (continued) 37.4 Credit risk (continued) Credit exposure by credit rating (continued) Company AAA AA A Not-rated Unit-linked Total 31 December 2012 General AFS financial assets Islamic debt securities 104, ,123 1,777 37, ,051 Malaysian Government Islamic papers ,916* - 93,916 HTM financial assets Malaysian Government Islamic papers ,722* - 32,722 LAR Retakaful assets , ,619 Loans and receivables, excluding takaful receivables - 10,411 26,446 68, ,444 receivables ,014 16,385-17,605 Cash and cash equivalents 9,604 19,458 5,651 7,802-42, , ,198 34, , ,872 * Malaysian Government Islamic papers are not rated by RAM but instead is rated A- based on Malaysia sovereign rating accorded by Standard & Poor.

271 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Financial instruments (continued) 37.4 Credit risk (continued) Credit exposure by credit rating (continued) Company AAA AA A Not-rated Unit-linked Total 31 December 2012 Company AFS financial assets Islamic debt securities 818,723 1,148,214 14, ,039-2,295,190 Malaysian Government Islamic papers ,459* - 664,459 FVTPL financial assets Islamic debt securities ,267 14,267 HTM financial assets Islamic debt securities ,501 80, ,127 Malaysian Government Islamic papers ,503* - 145,503 LAR Retakaful assets , ,473 Loans and receivables, excluding takaful receivables , , ,170 1, ,343 receivables ,338 78,943-80,498 Cash and cash equivalents 99, ,696 33,004 54,115 9, , ,126 1,333, ,032 1,943,328 24,579 4,423,640 * Malaysian Government Islamic papers are not rated by RAM but instead is rated A- based on Malaysia sovereign rating accorded by Standard & Poor.

272 270 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 37. Financial instruments (continued) 37.4 Credit risk (continued) Credit exposure by credit rating (continued) Company AAA AA A Not-rated Unit-linked Total 31 December 2011 Operator AFS financial assets Islamic debt securities 19,820 68,434-20, ,506 Malaysian Government Islamic papers ,291* - 10,291 LAR Loans and receivables, excluding takaful receivables - 32,794 65,794 36, ,374 Cash and cash equivalents 6,529 18,828 2, ,811 26, ,056 68,199 67, ,982 * Malaysian Government Islamic papers are not rated by RAM but instead is rated A- based on Malaysia sovereign rating accorded by Standard & Poor.

273 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Financial instruments (continued) 37.4 Credit risk (continued) Credit exposure by credit rating (continued) Company AAA AA A Not-rated Unit-linked Total 31 December 2011 Family AFS financial assets Islamic debt securities 562, ,476 23, ,976-1,473,576 Malaysian Government Islamic papers ,315* - 492,315 FVTPL financial assets Islamic debt securities ,260 15,260 HTM financial assets Islamic debt securities 48, , ,061 Malaysian Government Islamic papers ,843* - 112,843 LAR Retakaful assets Loans and receivables, excluding takaful receivables 14,393 80, , , ,517 receivables , ,355 Cash and cash equivalents 41, ,191 7,264 1,876 8, , , , ,461 1,166,957 24,690 3,015,070 * Malaysian Government Islamic papers are not rated by RAM but instead is rated A- based on Malaysia sovereign rating accorded by Standard & Poor.

274 272 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 37. Financial instruments (continued) 37.4 Credit risk (continued) Credit exposure by credit rating (continued) Company AAA AA A Not-rated Unit-linked Total 31 December 2011 General AFS financial assets Islamic debt securities 109, ,440 1,963 28, ,341 Malaysian Government Islamic papers ,100* - 89,100 HTM financial assets Malaysian Government Islamic papers ,766* - 32,766 LAR Retakaful assets , ,079 Loans and receivables, excluding takaful receivables 4,701 24,103 98,840 36, ,076 receivables ,496-31,496 Cash and cash equivalents 8,227 18,492 6, , , , , , ,599 * Malaysian Government Islamic papers are not rated by RAM but instead is rated A- based on Malaysia sovereign rating accorded by Standard & Poor.

275 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Financial instruments (continued) 37.4 Credit risk (continued) Credit exposure by credit rating (continued) Company AAA AA A Not-rated Unit-linked Total 31 December 2011 Company AFS financial assets Islamic debt securities 691, ,350 25, ,466-1,869,423 Malaysian Government Islamic papers ,706* - 591,706 FVTPL financial assets Islamic debt securities ,260 15,260 HTM financial assets Islamic debt securities 48, , ,061 Malaysian Government Islamic papers ,609* - 145,609 LAR Retakaful assets , ,775 Loans and receivables, excluding takaful receivables 19, , , , ,545 receivables , ,851 Cash and cash equivalents 55, ,511 15,691 1,925 8, , ,040 1,207, ,485 1,623,024 24,690 4,105,229 * Malaysian Government Islamic papers are not rated by RAM but instead is rated A- based on Malaysia sovereign rating accorded by Standard & Poor.

276 274 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 37. Financial instruments (continued) 37.4 Credit risk (continued) Credit exposure by credit rating (continued) Company AAA AA A Not-rated Unit-linked Total 1 January 2011 Operator AFS financial assets Islamic debt securities 20,140 23, ,307 LAR Loans and receivables, excluding takaful receivables - 60,117 49,215 48, ,986 Cash and cash equivalents 640 6,922 10,090 10,050-27,702 20,780 90,206 59,305 58, ,995

277 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Financial instruments (continued) 37.4 Credit risk (continued) Credit exposure by credit rating (continued) Company AAA AA A Not-rated Unit-linked Total 1 January 2011 Family AFS financial assets Islamic debt securities 429, ,406 24, ,038-1,452,002 Malaysian Government Islamic papers ,994* - 465,994 FVTPL financial assets Islamic debt securities ,038 14,038 HTM financial assets Islamic debt securities 48, , ,002 Malaysian Government Islamic papers ,903* - 112,903 LAR Retakaful assets Loans and receivables, excluding takaful receivables 24,714 78, , ,645 4, ,930 receivables ,292-35,292 Cash and cash equivalents 17,976 45,215 89,983 2,039 9, , , , ,100 1,088,827 27,810 2,830,693 * Malaysian Government Islamic papers are not rated by RAM but instead is rated A- based on Malaysia sovereign rating accorded by Standard & Poor.

278 276 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 37. Financial instruments (continued) 37.4 Credit risk (continued) Credit exposure by credit rating (continued) Company AAA AA A Not-rated Unit-linked Total 1 January 2011 General AFS financial assets Islamic debt securities 92, ,738 1,990 48, ,117 Malaysian Government Islamic papers ,456* - 88,456 HTM financial assets Malaysian Government Islamic papers ,809* - 32,809 LAR Retakaful assets , ,882 Loans and receivables, excluding takaful receivables 8,260 41,836 63,116 27, ,721 receivables ,415-42,415 Cash and cash equivalents 4,380 23,879 16,094 5,662-50, , ,453 81, , ,415 * Malaysian Government Islamic papers are not rated by RAM but instead is rated A- based on Malaysia sovereign rating accorded by Standard & Poor.

279 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Financial instruments (continued) 37.4 Credit risk (continued) Credit exposure by credit rating (continued) Company AAA AA A Not-rated Unit-linked Total 1 January 2011 Company AFS financial assets Islamic debt securities 541, ,311 26, ,067-1,752,426 Malaysian Government Islamic papers ,450* - 554,450 FVTPL financial assets Islamic debt securities ,038 14,038 HTM financial assets Islamic debt securities 48, , ,002 Malaysian Government Islamic papers ,712* - 145,712 LAR Retakaful assets , ,148 Loans and receivables, excluding takaful receivables 32, , , ,860 4, ,689 receivables ,707-77,707 Cash and cash equivalents 22,996 76, ,167 17,751 9, , ,123 1,194, ,605 1,510,345 27,810 3,789,155 * Malaysian Government Islamic papers are not rated by RAM but instead is rated A- based on Malaysia sovereign rating accorded by Standard & Poor.

280 278 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 37. Financial instruments (continued) 37.4 Credit risk (continued) Age analysis of takaful receivables past-due but not impaired A financial asset is deemed past-due when the counterparty has failed to make payment even though the outstanding amount is contractually due. Receivables past-due but not impaired includes contribution due and claims recovery from retakaful which remained outstanding after the contractual due date for more than 6 months. the age analysis of takaful receivables past-due but not impaired as at the end of the reporting period based on days past-due was as follows: Family General Group Family General Company 31 December 2012 Days past-due 1-30 days 2, ,341 1, , days , , days days 1,358 2,365 3,723 1,324 2,214 3,538 > 180 days 2,499 5,984 8,483 2,462 3,174 5,636 7,374 9,231 16,605 7,010 6,089 13, December 2011 Days past-due 1-30 days 1, ,491 1, , days , , days , , days 913 1,229 2, ,137 2,023 > 180 days 5,235 7,345 12,580 3,160 2,290 5,450 9,221 9,546 18,767 6,828 4,332 11,160 1 January 2011 Days past-due 1-30 days days days days > 180 days , , ,133 2, ,133 2,082

281 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Financial instruments (continued) 37.4 Credit risk (continued) Impairment loss of takaful receivables The Group and the Company assess impairment on an individual and collective basis. The Group and the Company will assess on a case by case basis, on whether there is any objective evidence that the outstanding due is impaired for contribution due and claims recovery that are considered individually significant. The criteria that the Group and the Company use to determine whether there is objective evidence of impairment for those selected for individual assessment include: (i) contribution due or claims recovery past-due for 6 months or more and where outstanding receivables is above 2% of total takaful receivables and RM200,000 for Family and General takaful receivables respectively; (ii) significant financial difficulty of customer/intermediaries; (iii) long outstanding balances where these are disputed and not resolved; and (iv) breach of contract, such as default or deliquency in payments. the Group and the Company record impairment allowance for loans and receivables and takaful receivables in separate Allowance for Impairment accounts. Unless the Group and the Company are satisfied that recovery of the amount is possible, the amount considered irrecoverable is written off against the receivables directly. A reconciliation of the allowance for impairment losses for takaful receivables was as follows: Note Family General Group At 1 January ,434 26,719 36,153 Writeback of impairment loss 26 (3,867) (17,197) (21,064) At 31 December 2011/1 January ,567 9,522 15,089 Writeback of impairment loss 26 (1,666) (2,540) (4,206) At 31 December ,901 6,982 10,883

282 280 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 37. Financial instruments (continued) 37.4 Credit risk (continued) Impairment loss of takaful receivables (continued) Note Family General Company At 1 January ,976 23,047 31,023 Writeback of Impairment loss 26 (2,535) (13,603) (16,138) At 31 December 2011/1 January ,441 9,444 14,885 Writeback of impairment loss 26 (1,591) (2,543) (4,134) At 31 December ,850 6,901 10, Liquidity risk Liquidity risk is the risk that the Group and the Company will encounter difficulty in meeting obligations associated with financial instruments. In respect of catastrophic events, there is also a liquidity risk associated with the timing differences between gross cash outflows and expected retakaful recoveries. the following policies and procedures are in place to mitigate the Group s and the Company s exposure to liquidity risk - the Group and the Company-wide liquidity risk policy setting out the evaluation and determination of the components of liquidity risk of the Group and the Company. Compliance with the policy is monitored and reported monthly and exposures and breaches are reported to the Group s and the Company s Risk Management Committee as soon as practicable. The policy is regularly reviewed or pertinence and for changes in the risk environment. - Setting up guidelines on asset allocations, portfolio limit structures and maturity profiles of assets, in order to ensure sufficient funding is available to meet takaful and investment contracts obligations. - Setting up contingency funding plans which specify minimum proportions of funds to meet emergency calls as well as specifying events that would trigger such plans. - the Company s catastrophe excess of loss retakaful contracts contains clauses permitting the immediate draw down of funds to meet claims payments should claims events exceed certain amount.

283 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Financial instruments (continued) 37.5 Liquidity risk (continued) Maturity profiles The table below summarises the maturity profile of the financial liabilities of the Group and of the Company based on remaining undiscounted contractual obligations, including profit payable. For takaful contract liabilities, maturity profiles are determined based on estimated timing of net cash outflows from the recognised takaful liabilities. Investment-linked liabilities are repayable or transferable on demand and are included in the up to a year column. Group Carrying value Up to a year* 1-3 years 3-5 years More than 5 years No Maturity Total 31 December 2012 Operator Other payables 84,531 77, ,940-84,531 Family Qardh payables 10,398 10, ,398 Provision for outstanding claims 28,387 27, ,387 payables 20,501 20, ,501 Other payables 156, ,711 2, , , , ,439 2, , ,720 General Qardh payables 23,888 23, ,888 Provision for outstanding claims 389, , ,980 54,543 23, ,557 payables 22,625 20,922 1, ,625 Other payables 61,492 61, , , , ,864 54,556 23, ,562 Group Provision for outstanding claims 417, , ,398 54,683 23, ,944 payables 43,126 41,423 1, ,126 Other payables 236, ,965 2, ,964 9, , , , ,066 54,766 29,100 9, ,083 * expected utilisation or settlement is within 12 months from the reporting date.

284 282 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 37. Financial instruments (continued) 37.5 Liquidity risk (continued) Maturity profiles (continued) Group Carrying value Up to a year* 1-3 years 3-5 years More than 5 years No Maturity Total 31 December 2011 Operator Other payables 65,997 31,871 26, , ,997 Family Qardh payables 11,398 11, ,398 Provision for outstanding claims 30,237 30, ,237 payables 19,496 18,445 1, ,496 Other payables 129, ,689 1, , , , ,769 2, , ,250 General Qardh payables 20,798 20, ,798 Provision for outstanding claims 387, , ,135 54,628 20, ,642 payables 26,041 23,522 2, ,041 Other payables 52,624 49,167 1, ,037-52, , , ,451 55,251 21, ,105 Group Provision for outstanding claims 417, , ,135 54,628 20, ,879 payables 45,537 41,967 3, ,537 Other payables 224, ,344 29, ,107 1, , , , ,523 55,436 28,301 1, ,773 * expected utilisation or settlement is within 12 months from the reporting date.

285 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Financial instruments (continued) 37.5 Liquidity risk (continued) Maturity profiles (continued) Group Carrying value Up to a year* 1-3 years 3-5 years More than 5 years No Maturity Total 1 January 2011 Operator Other payables 35,309 27, , ,309 Family Qardh payables 12,173 12, ,173 Provision for outstanding claims 26,762 25, ,762 payables 15,217 15, ,217 Other payables 155, ,983 1, , , ,068 2, ,558 General Qardh payables 19,074 19, ,074 Provision for outstanding claims 356, , ,815 47,719 19, ,285 payables 35,237 31,096 4, ,237 Other payables 66,234 66, , , , ,137 47,732 19, ,830 Group Provision for outstanding claims 383, , ,189 48,017 19, ,047 payables 50,454 46,313 4, ,454 Other payables 213, ,749 2, , , , , ,281 48,126 26, ,625 * expected utilisation or settlement is within 12 months from the reporting date.

286 284 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 37. Financial instruments (continued) 37.5 Liquidity risk (continued) Maturity profiles (continued) Company Carrying value Up to a year* 1-3 years 3-5 years More than 5 years No Maturity Total 31 December 2012 Operator Other payables 72,680 72, ,680 Family Provision for outstanding claims 25,386 25, ,386 payables 15,318 15, ,318 Other payables 145, ,099 2, , , ,803 2, ,861 General Provision for outstanding claims 356, , ,433 54,543 23, ,014 payables 20,505 20, ,505 Other payables 60,303 60, , , , ,614 54,556 23, ,822 Company Provision for outstanding claims 381, , ,433 54,543 23, ,400 payables 35,823 35, ,823 Other payables 223, ,232 2, , , , ,918 54,580 23, ,001 * expected utilisation or settlement is within 12 months from the reporting date.

287 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Financial instruments (continued) 37.5 Liquidity risk (continued) Maturity profiles (continued) Company Carrying value Up to a year* 1-3 years 3-5 years More than 5 years No Maturity Total 31 December 2011 Operator Other payables 55,268 28,966 26, ,268 Family Provision for outstanding claims 26,150 26, ,150 payables 15,930 14,879 1, ,930 Other payables 118, ,940 1, , , ,969 2, ,325 General Provision for outstanding claims 340, , ,623 54,628 20, ,045 payables 23,522 23, ,522 Other payables 46,075 45, , , , ,857 54,628 20, ,642 Company Provision for outstanding claims 366, , ,623 54,628 20, ,195 payables 39,452 38,401 1, ,452 Other payables 200, ,325 27, , , , ,383 54,760 20, ,813 * expected utilisation or settlement is within 12 months from the reporting date.

288 286 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 37. Financial instruments (continued) 37.5 Liquidity risk (continued) Maturity profiles (continued) Company Carrying value Up to a year* 1-3 years 3-5 years More than 5 years No Maturity Total 1 January 2011 Operator Other payables 22,921 22, ,921 Family Provision for outstanding claims 24,085 24, ,085 payables 12,233 12, ,233 Other payables 146, ,465 1, , , ,783 1, ,691 General Provision for outstanding claims 279, ,863 91,556 47,719 19, ,433 payables 31,096 31, ,096 Other payables 62,524 62, , , ,289 91,737 47,732 19, ,053 Company Provision for outstanding claims 303, ,948 91,556 47,719 19, ,518 payables 43,329 43, ,329 Other payables 194, ,490 2, , , ,767 93,923 47,732 19, ,717 * expected utilisation or settlement is within 12 months from the reporting date.

289 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Financial instruments (continued) 37.6 Market risk Market risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market prices. Market risk comprises three (3) types of risk - foreign exchange rates (Currency risk), market profit yields (Profit Yield risk) and market prices (Price risk). the key features of the Group s and the Company s market risk management practices and policies are as follows: - A Group and the Company-wide market risk policy setting out the evaluation and determination of components of market risk for the Group and the Company. Compliance with the policy is monitored and reported monthly to the Risk Management Committee (RMC) and exposures and breaches are reported as soon as practicable. - Set asset allocation, portfolio limit structure and diversification benchmark to ensure that assets back specific contract liabilities and that assets are held to deliver income and gains for certificate holders in line with terms of the respective contracts expectations of policies. The Group s and the Company s policies on asset allocation, portfolio limit structure and diversification benchmark have been set in line with Group s and Company s risk management policy after taking cognisance of the regulatory requirements in respect of maintenance of assets and solvency. the Group and the Company also issue unit-linked investment policies. In the unit-linked business, the certificate holders bear investment risk on the assets held in the unit-linked funds as the certficate benefits are directly linked to value of the assets in the funds. The Group s and Company s exposure to market risk on this business is limited to the extent that income arising from asset management charges is based on the value of the assets in the funds Currency risk Currency risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in foreign exchange rates. the Group s and the Company s primary transactions are carried out in Ringgit Malaysia (RM) and its exposure to foreign exchange risk arises principally with respect to Indonesia Rupiah (RP) and US Dollar (USD). As the Group s and Company s business is conducted primarily in Malaysia, the Group s and the Company s financial assets are also primarily maintained in Malaysia as required under the Act, 1984, and hence, primarily denominated in the same currency (the local RM) as its takaful and investment contract liabilities. Accordingly, the main foreign exchange risk from recognised assets and liabilities arises from transactions other than those in which takaful and investment contract liabilities are expected to be settled. As the Group s and the Company s main foreign exchange risk from recognised assets and liabilities arises from retakaful transactions for which the balances are expected to be settled and realised in less than a year, the impact arising from sensitivity in foreign exchange rates is deemed minimal as the Group and the Company has no significant concentration of foreign currency risk. the Group s and the Company s exposure to currency risk is immaterial in the context of the financial statements and hence, sensitivity analysis is not presented.

290 288 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 37. Financial instruments (continued) 37.8 Profit yield risk Profit yield risk is the risk that the value or future cash flows of a financial instrument will fluctuate because of changes in market profit yield. Floating rate/yield instruments expose the Group and the Company to cash flow risk, whereas fixed rate/yield instruments expose the Group and the Company to fair value risk. Risk management objectives, policies and processes for managing the risk the Group s and the Company s profit risk policy requires Management to manage the risk by maintaining an appropriate mix of variable and fixed rate/yield instruments. The policy also requires Management to manage the maturities of profit-bearing financial assets and liabilities. Floating rate/yield instruments will be re-priced at intervals of not more than one (1) year. Profit on fixed rate/yield instruments is priced at inception of the financial instrument and is fixed until maturity. Exposure to profit yield risk the profit yield profile of the Group s and the Company s significant profit-bearing financial instruments, based on carrying amounts as at the end of the reporting period was as follows: Operator Family General Group Fixed rate instruments 31 December 2012 AFS financial assets 220,743 2,318, ,967 2,970,266 FVTPL financial assets ,340-58,974 HTM financial assets 1, ,271 35, ,431 LAR 157, , , , ,876 3,262, ,652 4,246, December 2011 AFS financial assets 121,663 1,995, ,441 2,493,261 FVTPL financial assets - 23,517-23,517 HTM financial assets 4, ,931 34, ,579 LAR 197, , ,542 1,179, ,259 3,067, ,479 4,005,582 1 January 2011 AFS financial assets 43,307 1,959, ,573 2,348,676 FVTPL financial assets - 21,571-21,571 HTM financial assets 2, ,666 34, ,106 LAR 214, , ,359 1,046, ,555 2,890, ,456 3,712,587

291 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Financial instruments (continued) 37.8 Profit yield risk (continued) Exposure to profit yield risk (continued) Operator Family General Company Fixed rate instruments 31 December 2012 AFS financial assets 219,731 2,308, ,967 2,959,649 FVTPL financial assets - 14,267-14,267 HTM financial assets - 241,908 32, ,630 LAR 98, , , , ,361 3,110, ,847 4,007, December 2011 AFS financial assets 118,797 1,965, ,441 2,461,129 FVTPL financial assets - 15,260-15,260 HTM financial assets - 241,904 32, ,670 LAR 136, , ,294 1,001, ,199 2,906, ,501 3,752,066 1 January 2011 AFS financial assets 43,307 1,917, ,573 2,306,876 FVTPL financial assets - 14,038-14,038 HTM financial assets - 241,905 32, ,714 LAR 150, , , , ,438 2,738, ,250 3,473,751 the Group and the Company have no significant concentration of profit yield risk. A change of 50 basis points in profit rates at the end of the reporting period would have increased/(decreased) other comprehensive income/equity, Family and General participant s fund by the amounts shown below. This analysis assumes that all other variables remain constant.

292 290 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 37. Financial instruments (continued) 37.8 Profit yield risk (continued) Exposure to profit yield risk (continued) Operator Change in variables Impact on profit before tax Group Impact on equity* Impact on profit before tax Company Impact on equity* 31 December 2012 AFS financial assets +50bps - (5,218) - (5,219) AFS financial assets -50bps - 5,284-5, December 2011 AFS financial assets +50bps - (1,580) - (1,551) AFS financial assets -50bps - 2,347-2,318 1 January 2011 AFS financial assets +50bps - (491) - (491) AFS financial assets -50bps Family Change in variables Impact on operating surplus Group Impact on participants fund Impact on operating surplus Company Impact on participants fund 31 December 2012 AFS financial assets +50bps - (81,435) - (81,483) FVTPL financial assets +50bps (217) (217) (217) (217) (217) (81,652) (217) (81,700) AFS financial assets -50bps - 92,453-92,501 FVTPL financial assets -50bps , ,724

293 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Financial instruments (continued) 37.8 Profit yield risk (continued) Exposure to profit yield risk (continued) Change in variables Impact on operating surplus Group Impact on participants fund Impact on operating surplus Company Impact on participants fund Family 31 December 2011 AFS financial assets +50bps - (64,777) - (64,501) FVTPL financial assets +50bps (285) (285) (247) (247) (285) (65,062) (247) (64,748) AFS financial assets -50bps - 70,051-69,775 FVTPL financial assets -50bps , ,027 1 January 2011 AFS financial assets +50bps - (56,871) - (57,060) FVTPL financial assets +50bps (235) (235) (235) (235) (235) (57,106) (235) (57,295) AFS financial assets -50bps - 61,707-61,896 FVTPL financial assets -50bps , ,136

294 292 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 37. Financial instruments (continued) 37.8 Profit yield risk (continued) Exposure to profit yield risk (continued) Change in variables Impact on operating surplus Group Impact on participants fund Impact on operating surplus Company Impact on participants fund General 31 December 2012 AFS financial assets +50bps - (11,860) - (11,860) AFS financial assets -50bps - 12,302-12, December 2011 AFS financial assets +50bps - (8,257) - (8,257) AFS financial assets -50bps - 8,483-8,483 1 January 2011 AFS financial assets +50bps - (8,667) - (8,667) AFS financial assets -50bps - 8,949-8,949

295 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Financial instruments (continued) 37.8 Profit yield risk (continued) Exposure to profit yield risk (continued) Group Change in variables Impact on profit before tax Impact on equity* Impact on operating surplus Impact on participants fund Group 31 December 2012 AFS financial assets +50bps - (5,218) - (93,295) FVTPL financial assets +50bps - - (217) (217) - (5,218) (217) (93,512) AFS financial assets -50bps - 5, ,755 FVTPL financial assets -50bps , , December 2011 AFS financial assets +50bps - (1,580) - (73,034) FVTPL financial assets +50bps - - (285) (285) - (1,580) (285) (73,319) AFS financial assets -50bps - 2,347-78,534 FVTPL financial assets -50bps , ,824 1 January 2011 AFS financial assets +50bps - (491) - (65,538) FVTPL financial assets +50bps - - (235) (235) - (491) (235) (65,773) AFS financial assets -50bps ,656 FVTPL financial assets -50bps ,896 * impact on Equity reflects adjustments for tax, when applicable.

296 294 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 37. Financial instruments (continued) 37.8 Profit yield risk (continued) Exposure to profit yield risk (continued) Company Change in variables Impact on profit before tax Impact on equity* Impact on operating surplus Impact on participants fund Company 31 December 2012 AFS financial assets +50bps - (5,219) - (93,343) FVTPL financial assets +50bps - - (217) (217) - (5,219) (217) (93,560) AFS financial assets -50bps - 5, ,803 FVTPL financial assets -50bps , , December 2011 AFS financial assets +50bps - (1,551) - (72,758) FVTPL financial assets +50bps - - (247) (247) - (1,551) (247) (73,005) AFS financial assets -50bps - 2,318-78,258 FVTPL financial assets -50bps , ,510 1 January 2011 AFS financial assets +50bps - (491) - (65,727) FVTPL financial assets +50bps - - (235) (235) - (491) (235) (65,962) AFS financial assets -50bps ,845 FVTPL financial assets -50bps ,085 * impact on Equity reflects adjustments for tax, when applicable. the Group and the Company have no significant concentration of profit yield risk.

297 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Financial instruments (continued) 37.9 Other price risk Equity price risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in market prices (other than those arising from profit yield risk or currency risk), whether those changes are caused by factors specific to the individual financial instrument or its issuer or factors affecting similar financial instruments traded in the market. the Group s and the Company s equity price risk exposure relates to financial assets whose values will fluctuate as a result of changes in market prices (excluding those investment securities held for the account of unit-linked business). Risk management objectives, policies and processes for managing the risk the Group s and the Company s price risk policy requires it to manage such risks by setting and monitoring objectives and constraints on investments, diversification plans, limits on investments in each country, sector, market and issuer, having regard also to such limits stipulated by BNM. The Group and the Company comply with BNM stipulated limits during the financial year and has no significant concentration of price risk. Equity price risk sensitivity analysis the analysis below is performed for reasonably possible movements in key variables with all other variables held constant, showing the impact on OCI/Equity for Operator, and showing the impact on operating surplus/participants fund for Investment-linked Fund, and participants fund for Family Fund and General Fund accordingly. The correlation of variables will have a significant effect in determining the ultimate impact on price risk, but to demonstrate the impact due to changes in variables, variables had to be changed on individual basis. It should be noted that movements in these variables are non-linear. Change in variables Impact on profit before tax Group Impact on equity* Impact on profit before tax Company Impact on equity* Operator 31 December 2012 Market price +15% - 12,578-11,568 Market price -15% - (12,578) - (11,568) 31 December 2011 Market price +15% - 10,732-9,869 Market price -15% - (10,732) - (9,869) 1 January 2011 Market price +15% - 14,377-13,465 Market price -15% - (14,377) - (13,465) * impact on Equity reflects adjustments for tax, when applicable.

298 296 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 37. Financial instruments (continued) 37.9 Other price risk (continued) Equity price risk sensitivity analysis (continued) Change in variables Impact on operating surplus Group Impact on participants fund Impact on operating surplus Company Impact on participants fund Family 31 December 2012 Market price +15% 15,249 91,178 5,963 69,900 Market price -15% (15,249) (91,178) (5,963) (69,900) 31 December 2011 Market price +15% 13,045 70,739 4,462 54,769 Market price -15% (13,045) (70,739) (4,462) (54,769) 1 January 2011 Market price +15% 12,503 84,851 3,972 72,435 Market price -15% (12,503) (84,851) (3,972) (72,435) General 31 December 2012 Market price +15% - 14,763-14,414 Market price -15% - (14,763) - (14,414) 31 December 2011 Market price +15% - 9,521-9,369 Market price -15% - (9,521) - (9,369) 1 January 2011 Market price +15% - 14,104-13,954 Market price -15% - (14,104) - (13,954)

299 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Financial instruments (continued) 37.9 Other price risk (continued) Equity price risk sensitivity analysis (continued) Group Change in variables Impact on profit before tax Impact on equity* Impact on operating surplus Impact on participants fund Group 31 December 2012 Market price +15% - 7,967 15, ,941 Market price -15% - (7,967) (15,249) (105,941) 31 December 2011 Market price +15% - 6,432 13,045 80,259 Market price -15% - (6,432) (13,045) (80,259) 1 January 2011 Market price +15% - 10,230 12,503 98,955 Market price -15% - (10,230) (12,503) (98,955) * impact on Equity reflects adjustments for tax, when applicable.

300 298 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 37. Financial instruments (continued) 37.9 Other price risk (continued) Equity price risk sensitivity analysis (continued) Change in variables Impact on profit before tax Impact on equity* Company Impact on operating surplus Impact on participants fund Company 31 December 2012 Market price +15% - 6,958 5,963 84,315 Market price -15% - (6,958) (5,963) (84,315) 31 December 2011 Market price +15% - 5,569 4,462 64,138 Market price -15% - (5,569) (4,462) (64,138) 1 January 2011 Market price +15% - 9,318 3,972 86,389 Market price -15% - (9,318) (3,972) (86,389) * impact on Equity reflects adjustments for tax, when applicable.

301 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Financial instruments (continued) Fair value of financial instruments the carrying amounts of cash and cash equivalents, short-term receivables and payables approximate fair value due to the relatively short-term nature of these financial instruments. It was not practicable to estimate the fair value of the Group s investment in unquoted shares due to the lack of comparable quoted market prices and the inability to estimate fair value without incurring excessive costs. Please refer to respective note for the fair values of other financial assets and liabilities, together with the carrying amounts shown in the statements of financial position Fair value hierarchy the table below analyses those financial instruments carried at fair value by their valuation method. The different levels have been defined as follows: Level 1: Quoted prices (unadjusted) in active markets for identical assets or liabilities. Level 2: Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices). Level 3: Inputs for the asset or liability that are not based on observable market data (unobservable inputs). Group Level 2 31 December 2012 Level 1 Level 3 Total Operator AFS financial assets Equity securities 37, ,427 Unit trusts 31,574-61,270 92,844 Islamic debts securities - 200, ,588 Investment in linked funds 40, ,980 Malaysian Government Islamic papers - 20,155-20, , ,743 61, ,994 FVTPL financial assets Islamic debts securities , ,377 61, ,628

302 300 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 37. Financial instruments (continued) Fair value hierarchy (continued) Group 31 December 2012 Level 1 Level 2 Level 3 Total Family Fund AFS financial assets Equity securities 394, ,347 Unit trusts 111, , ,176 Islamic debts securities - 1,768,168-1,768,168 Malaysian Government Islamic papers - 550, , ,191 2,318, ,332 3,012,079 FVTPL financial assets Equity securities 72, ,083 Investment units in commodity, equity and fixed income closed end fund ,662 59,662 Unit trusts 29, ,580 Islamic debts securities - 58,340-58, ,663 58,340 59, , ,854 2,376, ,994 3,231,744

303 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Financial instruments (continued) Fair value hierarchy (continued) Group 31 December 2012 Level 1 Level 2 Level 3 Total General Fund AFS financial assets Equity securities 85, ,161 Unit trusts 13,257-36,379 49,636 Islamic debts securities - 337, ,051 Malaysian Government Islamic papers - 93,916-93,916 98, ,967 36, ,764 Group AFS financial assets Equity securities 516, ,935 Unit trusts 156, , ,656 Islamic debts securities - 2,305,807-2,305,807 Malaysian Government Islamic papers - 664, , ,187 2,970, ,404 3,928,857 FVTPL financial assets Equity securities 72, ,083 Investment units in commodity, equity and fixed income closed end fund ,662 59,662 Unit trusts 29, ,580 Islamic debts securities - 58,974-58, ,663 58,974 59, , ,850 3,029, ,066 4,149,156

304 302 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 37. Financial instruments (continued) Fair value hierarchy (continued) Group 31 December 2011 Level 1 Level 2 Level 3 Total Operator AFS financial assets Equity securities 37, ,534 Unit trusts 18,148-48,726 66,874 Islamic debts securities - 111, ,372 Investment in linked funds 38, ,222 Malaysian Government Islamic papers - 10,291-10,291 93, ,663 49, ,293 Family Fund AFS financial assets Equity securities 317, ,066 Unit trusts 67, , ,205 Islamic debts securities - 1,502,842-1,502,842 Malaysian Government Islamic papers - 492, , ,622 1,995, ,649 2,554,428 FVTPL financial assets Equity securities 60, ,998 Investment units in commodity, equity and fixed income closed end fund ,906 63,906 Unit trusts 25, ,971 Islamic debts securities - 23,517-23,517 86,969 23,517 63, , ,591 2,018, ,555 2,728,820

305 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Financial instruments (continued) Fair value hierarchy (continued) Group 31 December 2011 Level 1 Level 2 Level 3 Total General Fund AFS financial assets Equity securities 57, ,410 Unit trusts 6,061-33,711 39,772 Islamic debts securities - 287, ,341 Malaysian Government Islamic papers - 89,100-89,100 63, ,441 33, ,623 Group AFS financial assets Equity securities 411, ,010 Unit trusts 91, , ,851 Islamic debts securities - 1,901,555-1,901,555 Malaysian Government Islamic papers - 591, , ,348 2,493, ,513 3,254,122 FVTPL financial assets Equity securities 60, ,998 Investment units in commodity, equity and fixed income closed end fund ,906 63,906 Unit trusts 25, ,971 Islamic debts securities - 23,517-23,517 86,969 23,517 63, , ,317 2,516, ,419 3,428,514

306 304 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 37. Financial instruments (continued) Fair value hierarchy (continued) Group 1 January 2011 Level 1 Level 2 Level 3 Total Operator AFS financial assets Equity securities 39, ,443 Unit trusts 17,728-32,164 49,892 Islamic debts securities - 43,307-43,307 Investment in linked funds 36, ,860 93,605 43,307 32, ,502 Family Fund AFS financial assets Equity securities 292, ,540 Unit trusts 44, , ,916 Islamic debts securities - 1,493,802-1,493,802 Malaysian Government Islamic papers - 465, , ,727 1,959, ,729 2,442,252 FVTPL financial assets Equity securities 26, ,483 Investment units in commodity, equity and fixed income closed end fund ,649 79,649 Unit trusts 56, ,868 Islamic debts securities - 21,571-21,571 83,351 21,571 79, , ,078 1,981, ,378 2,626,823 General Fund AFS financial assets Equity securities 59, ,232 Unit trusts 6,620-28,266 34,886 Islamic debts securities - 257, ,117 Malaysian Government Islamic papers - 88,456-88,456 65, ,573 28, ,691

307 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Financial instruments (continued) Fair value hierarchy (continued) Group 1 January 2011 Level 1 Level 2 Level 3 Total Group AFS financial assets Equity securities 390, ,215 Unit trusts 68, , ,694 Islamic debts securities - 1,794,226-1,794,226 Malaysian Government Islamic papers - 554, , ,235 2,348, ,674 3,014,585 FVTPL financial assets Equity securities 26, ,483 Investment units in commodity, equity and fixed income closed end fund ,649 79,649 Unit trusts 56, ,868 Islamic debts securities - 21,571-21,571 83,351 21,571 79, , ,586 2,370, ,323 3,199,156

308 306 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 37. Financial instruments (continued) Fair value hierarchy (continued) Company 31 December 2012 Level 1 Level 2 Level 3 Total Operator AFS financial assets Equity securities 37, ,384 Unit trusts 24,844-61,270 86,114 Islamic debts securities - 199, ,576 Investment in linked funds 40, ,980 Malaysian Government Islamic papers - 20,155-20, , ,731 61, ,209 Family Fund AFS financial assets Equity securities 394, ,295 Unit trusts 31, , ,287 Islamic debts securities - 1,758,563-1,758,563 Malaysian Government Islamic papers - 550, ,388 FVTPL financial assets 426,250 2,308, ,332 2,922,533 Equity securities 39, ,753 Investment units in commodity, equity and fixed income closed end fund ,662 59,662 Islamic debts securities - 14,267-14,267 39,753 14,267 59, , ,003 2,323, ,994 3,036,215

309 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Financial instruments (continued) Fair value hierarchy (continued) Company 31 December 2012 Level 1 Level 2 Level 3 Total General Fund AFS financial assets Equity securities 85, ,161 Unit trusts 10,935-36,379 47,314 Islamic debts securities - 337, ,051 Malaysian Government Islamic papers - 93,916-93,916 96, ,967 36, ,442 Company AFS financial assets Equity securities 516, ,840 Unit trusts 67, , ,715 Islamic debts securities - 2,295,190-2,295,190 Malaysian Government Islamic papers - 664, , ,194 2,959, ,361 3,829,204 FVTPL financial assets Equity securities 39, ,753 Investment units in commodity, equity and fixed income closed end fund ,662 59,662 Islamic debts securities - 14,267-14,267 39,753 14,267 59, , ,947 2,973, ,023 3,942,886

310 308 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 37. Financial instruments (continued) Fair value hierarchy (continued) Company 31 December 2011 Level 1 Level 2 Level 3 Total Operator AFS financial assets Equity securities 36, ,952 Unit trusts 12,934-48,726 61,660 Islamic debts securities - 108, ,506 Investment in linked funds 38, ,222 Malaysian Government Islamic papers - 10,291-10,291 87, ,797 49, ,631 Family Fund AFS financial assets Equity securities 316, ,651 Unit trusts 18, , ,379 Islamic debts securities - 1,473,576-1,473,576 Malaysian Government Islamic papers - 492, , ,381 1,965, ,649 2,475,921 FVTPL financial assets Equity securities 29, ,747 Investment units in commodity, equity and fixed income closed end fund ,906 63,906 Islamic debts securities - 15,260-15,260 29,747 15,260 63, , ,128 1,981, ,555 2,584,834 General Fund AFS financial assets Equity securities 57, ,410 Unit trusts 5,047-33,711 38,758 Islamic debts securities - 287, ,341 Malaysian Government Islamic papers - 89,100-89,100 62, ,441 33, ,609

311 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Financial instruments (continued) Fair value hierarchy (continued) Company 31 December 2011 Level 1 Level 2 Level 3 Total Company AFS financial assets Equity securities 410, ,013 Unit trusts 36, , ,797 Islamic debts securities - 1,869,423-1,869,423 Malaysian Government Islamic papers - 591, , ,344 2,461, ,466 3,165,939 FVTPL financial assets Equity securities 29, ,747 Investment units in commodity, equity and fixed income closed end fund ,906 63,906 Islamic debts securities - 15,260-15,260 29,747 15,260 63, , ,091 2,476, ,372 3,274,852 1 January 2011 Operator AFS financial assets Equity securities 39, ,397 Unit trusts 11,649-32,164 43,813 Islamic debts securities - 43,307-43,307 Investment in linked funds 36, ,860 87,526 43,307 32, ,377 Family Fund AFS financial assets Equity securities 292, ,436 Unit trusts 18, , ,118 Islamic debts securities - 1,452,002-1,452,002 Malaysian Government Islamic papers - 465, , ,825 1,917, ,729 2,374,550

312 310 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 37. Financial instruments (continued) Fair value hierarchy (continued) Company 1 January 2011 Level 1 Level 2 Level 3 Total Family Fund FVTPL financial assets Equity securities 26, ,483 Investment units in commodity, equity and fixed income closed end fund ,649 79,649 Islamic debts securities - 14,038-14,038 26,483 14,038 79, , ,308 1,932, ,378 2,494,720 General Fund AFS financial assets Equity securities 59, ,232 Unit trusts 5,616-28,266 33,882 Islamic debts securities - 257, ,117 Malaysian Government Islamic papers - 88,456-88,456 64, ,573 28, ,687 Company AFS financial assets Equity securities 390, ,065 Unit trusts 35, , ,813 Islamic debts securities - 1,752,426-1,752,426 Malaysian Government Islamic papers - 554, , ,250 2,306, ,628 2,939,754 FVTPL financial assets Equity securities 26, ,483 Investment units in commodity, equity and fixed income closed end fund ,649 79,649 Islamic debts securities - 14,038-14,038 26,483 14,038 79, , ,733 2,320, ,277 3,059,924

313 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Financial instruments (continued) Fair value hierarchy (continued) the following table shows a reconciliation from the beginning balances to the ending balances for fair value measurements in Level 3 of the fair value hierarchy: Operator Family General Group Equity securities Balance at 1 January Total losses recognised in profit or loss - (135) (89) (224) Effect of movement in exchange rates Balance at 31 December 2011/ 1 January Effect of movement in exchange rates (4) - - (4) Balance at 31 December Unit trusts Balance at 1 January , ,594 28, ,024 Purchases 15,000 21,600 4,000 40,600 Total gains recognised in profit or loss 1,562 7,455 1,445 10,462 Balance at 31 December 2011/1 January , ,649 33, ,086 Purchases 10,000 4,087 1,000 15,087 Total gains recognised in profit or loss 2,544 8,596 1,668 12,808 Balance at 31 December , ,332 36, ,981 Investment units in commodity, equity and fixed income closed ended fund Balance at 1 January ,649-79,649 Redemption - (16,193) - (16,193) Total gains recognised in profit or loss Balance at 31 December 2011/1 January ,906-63,906 Redemption - (2,350) - (2,350) Total losses recognised in profit or loss - (1,894) - (1,894) Balance at 31 December ,662-59,662

314 312 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 37. Financial instruments (continued) Fair value hierarchy (continued) Operator Family General Company Equity securities Balance at 1 January Total losses recognised in profit or loss - (135) (89) (224) Balance at 31 December 2011/1 January 2011/ 31 December Unit trusts Balance at 1 January , ,594 28, ,024 Purchases 15,000 21,600 4,000 40,600 Total gains recognised in profit or loss 1,562 7,455 1,445 10,462 Balance at 31 December 2011/1 January , ,649 33, ,086 Purchases 10,000 4,087 1,000 15,087 Total gains recognised in profit or loss 2,544 8,596 1,668 12,808 Balance at 31 December , ,332 36, ,981 Investment units in commodity, equity and fixed income closed ended fund Balance at 1 January ,649-79,649 Redemption - (16,193) - (16,193) Total gains recognised in profit or loss Balance at 31 December 2011/1 January ,906-63,906 Redemption - (2,350) - (2,350) Total losses recognised in profit or loss - (1,894) - (1,894) Balance at 31 December ,662-59,662

315 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Operating leases Leases as lessee Non-cancellable operating lease rentals are payable as follows: Group Operator Group Non-related parties: Less than one year 3,049 9,086 1,195 3,049 9,086 1,195 Between one and five years 11,342 9,094 1,585 11,342 9,094 1,585 14,391 18,180 2,780 14,391 18,180 2,780 Related party: Less than one year 1, Between one and five years , ,958 19,107 3,311 14,391 18,279 3, Company Operator Company Non-related parties: Less than one year 2,845 9,086 1,195 2,845 9,086 1,195 Between one and five years 11,179 9,094 1,585 11,179 9,094 1,585 14,024 18,180 2,780 14,024 18,180 2,780 Related party: Less than one year Between one and five years ,024 18,279 3,311 14,024 18,279 3,311 Lease commitments are wholly payable from the Operator. The Group and the Company lease a number of computers and equipment under operating leases. The leases typically run for a period of five years, with an option to renew the lease after that date.

316 314 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 38. Operating leases (continued) Leases as lessor (continued) The Group and the Company lease out their investment properties (see Note 4). The future minimum lease receivables under non-cancellable leases are as follows: Operator Family General Group 31 December 2012 Non-related parties: Less than one year 171 6, ,046 Between one and five years 2 3, , ,488 1,025 10,686 Related party: Less than one year 1,107 2, ,438 Between one and five years 357 1, ,964 1,464 4, ,402 1,637 13,694 1,324 15, December 2011 Non-related parties: Less than one year 216 6, ,928 Between one and five years 173 8, , ,915 1,537 17,841 Related party: Less than one year 788 1, ,041 Between one and five years 602 1, ,113 1,390 2, ,154 1,779 18,699 2,517 22,995

317 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Operating leases (continued) Leases as lessor (continued) Operator Family General Group 1 January 2011 Non-related parties: Less than one year 181 2, ,482 Between one and five years 337 4, , , ,178 Related party: Less than one year 449 1, ,069 Between one and five years ,856 1,067 1, ,925 1,585 9,627 1,891 13,103 Operator Family General Company 31 December 2012 Non-related parties: Less than one year 171 6, ,046 Between one and five years 2 3, , ,401 1,025 10,599 Related party: Less than one year 702 1, ,438 Between one and five years 357 1, ,964 1,059 3, ,402 1,232 12,445 1,324 15,001

318 316 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 38. Operating leases (continued) Leases as lessor (continued) Operator Family General Company 31 December 2011 Non-related parties: Less than one year 187 6, ,874 Between one and five years 173 8, , ,795 1,537 17,692 Related party: Less than one year 788 1, ,382 Between one and five years 602 1, ,113 1,390 2, ,495 1,750 17,920 2,517 22,187 1 January 2011 Non-related parties: Less than one year 176 2, ,404 Between one and five years 337 4, , , ,100 Related party: Less than one year ,610 Between one and five years ,856 1,067 1, ,466 1,580 9,095 1,891 12, Capital commitments Group and Company Authorised by the Directors and contracted for ,623

319 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Related parties Identity of related parties For the purposes of these financial statements, parties are considered to be related to the Group or the Company if the Group or the Company has the ability, directly or indirectly, to control the party or exercise significant influence over the party in making financial and operating decisions, or vice versa, or where the Group or the Company and the party are subject to common control or common significant influence. Related parties may be individuals or other entities. Related parties also include key management personnel defined as those persons having authority and responsibility for planning, directing and controlling the activities of the Group either directly or indirectly. The key management personnel include all the Directors of the Group, and certain members of senior management of the Group. Compensation paid to key management personnel have been disclosed in Note 29. The Group has related party relationship with its holding companies, significant investors, subsidiaries and associates, Directors and key management personnel. Significant related party transactions The significant related party transactions of the Company, other than key management personnel compensation as disclosed in Note 29, are as follows: to Group to to Company to Ultimate holding company Contribution income for Family Contribution income for General 2,204 2,149 2,204 2,149 Claims paid for Family 600 2, ,051 Claims paid for General Holding company Dividend paid 36,003 11,680 36,003 11,680 Subsidiary company Contribution for facultative and treaty outward Contribution paid for facultative and treaty outward

320 318 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 40. Related parties (continued) Significant related party transactions (continued) to Group to to Company to Related companies Contribution income for Family Contribution income for General 2,457 1,793 2,457 1,793 Claims paid for Family 229 2, ,693 Claims paid for General Investment income 970 1, ,178 Lease rental expense Rental income 2,640 2,642 2,640 2,642 Commision paid Bank commissions

321 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Related parties (continued) The significant outstanding balances of the Group and of the Company as at 31 December 2011 with its related parties, are as follows: Operator Family General Group 31 December 2012 Bank balances 149 2, ,584 Fixed and call deposits 2,454 28,229 7,473 38,156 2,603 30,490 7,647 40, December 2011 Bank balances 3,765 8,801 4,153 16,719 Fixed and call deposits 1,464 9,899 6,620 17,983 5,229 18,700 10,773 34,702 1 January 2011 Bank balances 167 1, ,209 Fixed and call deposits ,338 2,130 28, ,357 2,153 29,281 Operator Family General Company 31 December 2012 Bank balances 149 2, ,584 Fixed and call deposits 2,454 28,229 7,473 38,156 2,603 30,490 7,647 40, December 2011 Bank balances 3,765 8,801 4,153 16,719 Fixed and call deposits 1,464 9,899 6,620 17,983 5,229 18,700 10,773 34,702 1 January 2011 Bank balances 348 1, ,887 Fixed and call deposits ,338 2,130 28, ,854 2,153 29,959

322 320 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 41. Explanation of transition to MFRS As stated in Note 1(a), these are the first financial statements of the Group and of the Company prepared in accordance with MFRS. The accounting policies set out in Note 2 have been applied in preparing the financial statements of the Group and of the Company for the financial year ended 31 December 2012, the comparative information presented in these financial statements for the year ended 31 December 2011 and in the preparation of the opening MFRS statement of financial position at 1 January 2011 (the Group s date of transition to MFRS). In preparing the opening consolidated statement of financial position at 1 January 2011, the Group has adjusted amounts reported previously in financial statements prepared in accordance with previous FRS. Following the transition to MFRS, a Operator is required to present consolidated financial statements for itself and the funds it controls in accordance with the requirements of MFRS 127, Consolidated and Separate Financial Statements. The statements of financial position and the statements of profit or loss and other comprehensive income of the Operator, Family Fund and General Fund are supplementary financial information presented in accordance with the requirements of BNM. In previous years, any deficit in funds is being accounted for as a reduction of liability in both funds and Company s financial statements. Following the transition to MFRS, deficit of funds is reported as a loss in the profit or loss of the funds and the Company. An explanation of how the transition from previous FRS to MFRS has affected the Group s and Company s financial position, financial performance and cash flows is set out as follows Reconciliation of financial position FRS Effect of transition to MFRS MFRS FRS Effect of transition to MFRS Group Operator 31 December January 2011 Assets MFRS Property and equipment 27, ,295 29, ,511 Equity Reserves 287, , , ,173

323 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Explanation of transition to MFRS (continued) 41.1 Reconciliation of financial position (continued) FRS Effect of transition to MFRS MFRS FRS Effect of transition to MFRS Group Family Fund 31 December January 2011 MFRS Assets Other investments 2,825, ,392 2,999,751 2,700, ,571 2,885,489 Loans and receivables, excluding takaful receivables 563, , ,284 3, ,382 receivables 61, ,352 43,657-43,657 Cash and cash equivalents 265,819 11, , ,917 11, ,678 Investment-linked takaful assets 194,506 (194,506) - 201,051 (201,051) - Equity Reserves - (10,816) (10,816) - (10,816) (10,816) Liabilities Qardh payables - 11,398 11,398-12,173 12,173 contract liabilities 102,681 3,935,483 4,038,164 52,904 3,667,311 3,720,215 payables 18, ,496 15,217-15,217 Other payables 133,183 (4,064) 129, ,275 (869) 155,406 Investment-linked takaful liabilities 5,679 (5,679) - 3,774 (3,774) - Participants' fund Family Fund 3,934,076 (3,934,076) - 3,665,646 (3,665,646) -

324 322 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 41. Explanation of transition to MFRS (continued) 41.1 Reconciliation of financial position (continued) FRS Effect of transition to MFRS MFRS FRS Effect of transition to MFRS Group General Fund 31 December January 2011 MFRS Equity Reserves - (19,074) (19,074) - (19,074) (19,074) Liabilities Qardh payables - 20,798 20,798-19,074 19,074 contract liabilities 883, ,039 1,067, , , ,046 Other payables 73,422 (20,798) 52,624 85,308 (19,074) 66,234 Participants' fund General Fund 164,965 (164,965) - 166,374 (166,374) - FRS Effect of transition to MFRS MFRS FRS Effect of transition to MFRS Company Operator 31 December January 2011 MFRS Assets Property and equipment 20, ,082 22, ,256 Equity Reserves 291, , , ,953

325 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Explanation of transition to MFRS (continued) 41.1 Reconciliation of financial position (continued) FRS Effect of transition to MFRS MFRS FRS Effect of transition to MFRS Company Family Fund 31 December January 2011 MFRS Assets Other investments 2,717, ,913 2,826,738 2,616, ,170 2,736,625 Loans and receivables, excluding takaful receivables 548, , ,370 3, ,930 receivables 53, ,355 35,292-35,292 Cash and cash equivalents 180,337 8, , ,675 8, ,266 Investment-linked takaful assets 125,464 (125,464) - 133,942 (133,942) - Liabilities contract liabilities 93,693 3,660,092 3,753,785 44,471 3,425,385 3,469,856 payables 15, ,930 12,233-12,233 Other payables 120,320 (2,075) 118, ,220 2, ,373 Investment-linked takaful liabilities 5,679 (5,679) - 3,774 (3,774) - Participants' fund Family Fund 3,660,092 (3,660,092) - 3,425,385 (3,425,385) - FRS Effect of transition to MFRS MFRS FRS Effect of transition to MFRS Company General Fund 31 December January 2011 MFRS Liabilities contract liabilities 804, ,469 1,003, , , ,792 Participants' fund General Fund 199,469 (199,469) - 197,314 (197,314) -

326 324 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 41. Explanation of transition to MFRS (continued) 41.2 Reconciliation of profit or loss and other comprehensive income for the year ended 31 December 2011 Group Company Operator FRS Effect of transition to MFRS MFRS FRS Effect of transition to MFRS MFRS Operator income - 327, , , ,067 Transfer from statements of comprehensive income Family 97,818 (97,818) - 92,761 (92,761) - General 85,547 (85,547) - 84,816 (84,816) - Wakalah fee income 144,433 (144,433) - 84,490 (84,490) - Other comprehensive income/(expense) (net of tax) Revaluation of property and equipment - (60) (60) - (60) (60) Total other comprehensive expense for the year (1,692) (60) (1,752) (2,584) (60) (2,644) Total comprehensive income for the year 74,687 (60) 74,627 69,125 (60) 69,065 Total comprehensive income/(expense) for the year attributable to: Owners of the Company 74,557 (60) 74,497 69,125 (60) 69,065

327 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Explanation of transition to MFRS (continued) 41.2 Reconciliation of profit or loss and other comprehensive income for the year ended 31 December 2011 Group Company Family Fund FRS Effect of transition to MFRS MFRS FRS Effect of transition to MFRS MFRS Operating revenue - 865, , , ,794 Total profit for the year 258, , , ,247 97, ,550 Profit attributable to the Operator/ participants - (360,829) (360,829) - (323,550) (323,550) Other comprehensive income/(expense) (net of tax) Fair value change of available-for-sale financial assets - 5,370 5,370-8,118 8,118 Foreign currency translation differences for foreign operations - 3,332 3, Other comprehensive income attributable to Operator/change in participants liabilities - (8,702) (8,702) - (8,118) (8,118)

328 326 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 41. Explanation of transition to MFRS (continued) 41.2 Reconciliation of profit or loss and other comprehensive income for the year ended 31 December 2011 (continued) Group Company General Fund FRS Effect of transition to MFRS MFRS FRS Effect of transition to MFRS MFRS Operating revenue - 470, , , ,239 Profit attributable to the Operator/ participants - (140,549) (140,549) - (141,777) (141,777) Other comprehensive income/(expense) (net of tax) Fair value change of available-for-sale financial assets - (9,285) (9,285) - (9,218) (9,218) Foreign currency translation differences for foreign operations - (892) (892) Other comprehensive income attributable to Operator/change in participants liabilities - 10,177 10,177-9,218 9, Material adjustments to the statements of cash flows for 2011 There are no material differences between the statements of cash flows presented under MFRS and the statements of cash flows presented under FRS.

329 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Supplementary financial information on the breakdown of realised and unrealised profits or losses The breakdown of the retained profits of the Group and of the Company as at 31 December, into realised and unrealised profits, pursuant to Paragraphs 2.06 and 2.23 of the Bursa Malaysia Main Market Listing Requirements, are as follows: Total retained profits of the Company and its subsidiaries: Group Company Realised 261, , , ,052 - Unrealised 39,289 18,055 18,050 (3,485) 301, , , ,567 Total share of retained profits of associates: - Realised Unrealised , , , ,567 Add: Consolidation adjustments 27,221 27, Total retained profits 328, , , ,567 The determination of realised and unrealised profits is based on the Guidance of 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 on 20 December 2010.

330 328 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Maklumat Hartanah Particulars of Properties A Pelaburan Hartanah / Investment Properties No Lokasi/ Location Penerangan Kegunaan/ Description of Existing Use Hakmilik/ Tenure Usia Bangunan/ Age of Building (tahun/ years) Keluasan Tanah, Kawasan Bina/ Land, Built-up Area (kaki persegi/ square feet) Nilai Buku Bersih pada/ Net Book Value as at (RM) Tarikh Penilaian Semula/ Date of Revaluation 1 No. 325A & 325B Blok 41, Kompleks Perniagaan Fajar Tawau Sabah Tiga unit Kompleks Perniagaan/ Pejabat 4 tingkat Three units of 4 storey Commercial Complex/ Office Pajakan bandar 999 tahun berakhir pada years town lease expiring on ,025/ 6,037 2,950, No. 64 & 65 Kompleks Jitra Jalan Sungai Korok Jitra Kedah Darul Aman Dua unit Rumah kedai/ Pejabat 2 tingkat Two units of 2 storey Shophouse/Office Pegangan Bebas Freehold 26 3,095/ 6,935 1,025, No. 23 Medan Istana 3 Bandar Ipoh Raya Ipoh Perak Darul Ridzuan Satu unit Rumah kedai/ Pejabat 3 tingkat One unit of 3 storey Shophouse/Office Pajakan 99 tahun berakhir pada years lease expiring on ,539/ 4, , No. 84 Batu 3 1/4 Jalan Gombak Kuala Lumpur Satu unit Rumah kedai/ Pejabat 5 tingkat One unit of 5 storey Shophouse/Office Pegangan Bebas Freehold 26 1,883/ 8,700 1,330, Lot 54 & 55 Bandar Wilayah Jasa Jalan Bunga Raya Lahad Datu Sabah Dua unit Rumah kedai/ Pejabat 3 tingkat Two units of 3 storey Shophouse/Office Pajakan Bandar 99 tahun berakhir pada years town lease expiring on ,400/ 7,200 1,680, No. 24 Jalan USJ 10/1B UEP Subang Jaya Selangor Darul Ehsan Satu unit Rumah kedai/ Pejabat 3 tingkat One unit of 3 storey Shophouse/Office Pegangan Bebas Freehold 18 3,200/ 9,600 5,140, No. 15 & 17 Jalan Kelibang Langkawi Mall Kuah Langkawi Kedah Darul Aman Dua unit Rumah kedai/ Pejabat 2 tingkat Two units of 2 storey Shophouse/Office Pegangan Bebas Freehold 19 1,440/ 7, ,

331 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 329 Maklumat Hartanah Particulars of Properties No Lokasi/ Location Penerangan Kegunaan/ Description of Existing Use Hakmilik/ Tenure Usia Bangunan/ Age of Building (tahun/ years) Keluasan Tanah, Kawasan Bina/ Land, Built-up Area (kaki persegi/ square feet) Nilai Buku Bersih pada/ Net Book Value as at (RM) Tarikh Penilaian Semula/ Date of Revaluation 8 No. 26 & 28 Jalan Perda Barat Bukit Mertajam Seberang Prai Penang Dua unit Rumah kedai/ Pejabat 3 tingkat Two units of 3 storey Shophouse/Office Pegangan bebas Freehold 14 3,293/ 8,840 1,200, No. 433 & 434 Jalan Kulas Kuching Sarawak Dua unit Rumah kedai/ Pejabat 4 tingkat Two units of 4 storey Shophouse/Office Pegangan Bebas Freehold 17 3,589/ 12,855 3,550, No. 312 Jalan Bandar 13 Taman Melawati Kuala Lumpur Satu unit Rumah kedai/ Pejabat 4 tingkat One unit of 4 storey Shophouse/Office Pegangan Bebas Freehold 18 1,920/ 7,070 1,600, No. 20, Fasa 1A Jalan Haji Manan Kluang Johor Darul Ta zim Satu unit Rumah kedai/ Pejabat 4 tingkat One unit of 4 storey Shophouse/Office Pajakan 99 tahun berakhir pada years lease expiring on ,658/ 9,930 1,900, Lot 13 & 14 Lazenda Commercial Centre Jalan Okk Abdullah Wilayah Persekutuan Labuan Dua unit bangunan Pejabat 3 tingkat Two units of 3 storey Office building Pajakan 999 tahun berakhir pada years lease expiring on ,504/ 7,200 2,200, Lot 28, 30 & 32 Jalan 2/3A Pasar Borong Selayang Selangor Darul Ehsan Tiga unit Rumah kedai/ Pejabat 4 tingkat Three units of 4 storey Shophouse/Office Pajakan 99 tahun berakhir pada years lease expiring on ,447/ 16,800 2,850, Lot Level 1 & Mezzanine Jalan Bukit Timbalan Johor Bharu Johor Darul Ta zim Dua tingkat bangunan Pejabat 13 tingkat Two floors of 13 storey Office building Pajakan 99 tahun berakhir pada years lease expiring on ,354* 1,730,

332 330 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Maklumat Hartanah Particulars of Properties No Lokasi/ Location Penerangan Kegunaan/ Description of Existing Use Hakmilik/ Tenure Usia Bangunan/ Age of Building (tahun/ years) Keluasan Tanah, Kawasan Bina/ Land, Built-up Area (kaki persegi/ square feet) Nilai Buku Bersih pada/ Net Book Value as at (RM) Tarikh Penilaian Semula/ Date of Revaluation 15 Lot Level 3 Jalan Bukit Timbalan Johor Bharu Johor Darul Ta zim Satu tingkat bangunan Pejabat 13 tingkat One floor of 13 storey Office building Pajakan 99 tahun berakhir pada years lease expiring on ,594* 1,000, No. 1 & 2 Jalan Kelicap Taman Pekan Baru Parit Buntar Perak Darul Ridzuan Dua unit Rumah kedai/ Pejabat 2 tingkat Two units of 2 storey Shophouse/Office Pajakan 99 tahun berakhir pada years lease expiring on ,956/ 7, , No. 46 & 47 Darul Jalan Rahmat Batu Pahat Johor Darul Ta zim Dua unit Rumah kedai/ Pejabat 4 tingkat Two units of 4 Storey Shophouse/Office Pegangan Bebas Freehold 23 3,220/ 12,092 1,480, No. 180 & 181 Jalan Tuan Hitam Jerteh Terengganu Darul Iman Dua unit Rumah kedai/ Pejabat 4 tingkat Two units of 4 storey Shophouse/Office Pegangan Bebas Freehold 22 3,200/ 12,250 1,640, Lot 82, 84 & 86 Jalan Rugbi 13/30 Seksyen Shah Alam Selangor Darul Ehsan Tiga unit Rumah kedai/ Pejabat 2 tingkat Three units of 2 storey Shophouse/Office Pajakan 99 tahun berakhir pada years lease expiring on ,339/ 11,309 2,940, No. 229 Jalan Shahab 2 Shahab Perdana Jalan Sultanah Sambungan Alor Star Kedah Darul Aman Satu unit Rumah kedai/ Pejabat 2 1/2 tingkat One unit of 2 1/2 storey Shophouse/Office Pegangan Bebas Freehold 16 1,400/ 3, , Lot No Jalan Dato Ulu Muar Kuala Pilah Negeri Sembilan Darul Khusus Satu unit Rumah kedai/ Pejabat 3 tingkat One unit of 3 storey Shophouse/Office Pajakan 99 tahun berakhir pada years lease expiring on ,001/ 3, ,

333 Syarikat Malaysia Berhad ( K) 331 Maklumat Hartanah Laporan Tahunan 2012 Annual Report Particulars of Properties No Lokasi/ Location Penerangan Kegunaan/ Description of Existing Use Hakmilik/ Tenure Usia Bangunan/ Age of Building (tahun/ years) Keluasan Tanah, Kawasan Bina/ Land, Built-up Area (kaki persegi/ square feet) Nilai Buku Bersih pada/ Net Book Value as at (RM) Tarikh Penilaian Semula/ Date of Revaluation 22 No. 45 Jalan Teluk Sisek Kuantan Pahang Darul Makmur Satu unit Rumah kedai/ Pejabat 4 tingkat One unit of 4 storey Shophouse/Office Pajakan 99 tahun berakhir pada years lease expiring on ,200/ 8,019 2,300, No. 27, 29 & 31 Pusat Komersil Temerloh Temerloh Pahang Darul Makmur Tiga unit Rumah kedai/ Pejabat 2 1/2 tingkat Three units of 2 1/2 storey Shophouse/Office Pajakan 99 tahun berakhir pada years lease expiring on ,195/ 15,050 1,880, No. 2 & 4 Jalan 6C/ Bandar Baru Bangi Selangor Darul Ehsan Dua unit Rumah kedai/ Pejabat 2 tingkat Two units of 2 storey Shophouse/Office Pajakan 99 tahun berakhir pada years lease expiring on ,383/ 8,032 1,845, Lot 14 Seremban City Centre Jalan Tuanku Munawir Seremban Negeri Sembilan Darul Khusus Satu unit Rumah kedai/ Pejabat 6 tingkat One unit of 6 storey Shophouse/Office Pajakan 99 tahun berakhir pada years lease expiring on ,500/ 14,589 3,469, No. 29, Jalan Delima Pusat Perdagangan Pontian Pontian Johor Darul Ta zim Satu unit Rumah kedai/ Pejabat 3 tingkat One unit of 3 storey Shophouse/Office Pajakan 99 tahun berakhir pada years lease expiring on ,899/ 10,248 1,570, Lot 12 Kompleks Seri Temin Jalan Ibrahim Sungai Petani Kedah Darul Aman Satu unit Rumah kedai/ Pejabat 4 tingkat One unit of 4 storey Shophouse/Office Pajakan 99 tahun berakhir pada years lease expiring on ,400/ 5, , Lot 1129 & 1130 Bangunan Darul Jalan Sultan Ismail Kuala Terengganu Terengganu Darul Iman Satu unit bangunan Pejabat 12 tingkat One unit of 12 storey Office building Pajakan kecil 35 tahun berakhir pada years sub lease expiring on ,600/ 23,637 6,010,

334 332 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Maklumat Hartanah Particulars of Properties No Lokasi/ Location Penerangan Kegunaan/ Description of Existing Use Hakmilik/ Tenure Usia Bangunan/ Age of Building (tahun/ years) Keluasan Tanah, Kawasan Bina/ Land, Built-up Area (kaki persegi/ square feet) Nilai Buku Bersih pada/ Net Book Value as at (RM) Tarikh Penilaian Semula/ Date of Revaluation 29 No. 616 & 617 Jalan Besar Tampin Negeri Sembilan Darul Khusus Dua unit bangunan Pejabat 2 tingkat Two units of 2 storey Office building Pajakan 99 tahun berakhir pada year lease expiring on ,498/ 8,685 1,470, No. 6, Jalan 6C/ Bandar Baru Bangi Selangor Darul Ehsan Satu unit Rumah kedai/ Pejabat 2 tingkat One unit of 2 storey Shophouse/Office Pajakan 99 tahun berakhir pada year lease expiring on ,905/ 3, , Suite 3B/G Blok 3B, Plaza Sentral Jalan Stesen Sentral Kuala Lumpur Satu tingkat bangunan Pejabat 22 tingkat One floor of 22 storey Office building Pegangan bebas Freehold 11 6,409* 7,900, No. 26 & 27 Jalan Tanjung Pasar Baru Machang Kelantan Darul Naim Dua unit bangunan Pejabat 2 tingkat Two units of 2 storey Office building Pajakan 66 tahun berakhir pada years lease expiring on ,600/ 4, , No. 330 & 331 Jalan Sultan Yahya Petra Kota Bharu Kelantan Darul Naim Dua unit bangunan Pejabat 4 1/2 tingkat Two units of 4 1/2 storey Office building Pajakan 99 tahun berakhir pada years lease expiring on ,200/ 15,200 1,950, Menara Malaysia No. 4, Jalan Sultan Sulaiman Kuala Lumpur Dua unit bangunan Pejabat Blok Utama - 26 tingkat Blok Annex - 29 tingkat Two units of Office building Main Block - 26 storey Annexe Block 29 Storey Pegangan Bebas Freehold Blok Utama/ Main Block - 39 Blok Annex/ Annexe Block ,427/ 393, ,800, No Taman Samudera Sri Manjung Perak Darul Ridzuan Satu unit Rumah kedai/ Pejabat 2 tingkat One unit of 2 storey Shophouse/Office Pajakan 99 tahun berakhir pada years lease expiring on ,800/ 5, ,

335 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 333 Maklumat Hartanah Particulars of Properties No Lokasi/ Location Penerangan Kegunaan/ Description of Existing Use Hakmilik/ Tenure Usia Bangunan/ Age of Building (tahun/ years) Keluasan Tanah, Kawasan Bina/ Land, Built-up Area (kaki persegi/ square feet) Nilai Buku Bersih pada/ Net Book Value as at (RM) Tarikh Penilaian Semula/ Date of Revaluation 36 No. 76A & 76 Pusat Perniagaan Jalan Tupai Taiping Perak Darul Ridzuan Dua unit bangunan Pejabat 3 tingkat Two units of 3 storey Office building Pegangan Bebas Freehold 9 3,134/ 18,304 1,530, No. 10 & 11 Jalan Sultan Yahya Petra Kota Bharu Kelantan Darul Naim Dua unit bangunan Pejabat 3 tingkat Two units of 3 storey Office building Pajakan 33 tahun berakhir pada years lease expiring on ,852/ 9,120 2,080, No Jalan Teluk Wanjah Alor Star Kedah Darul Aman Satu unit bangunan Pejabat 4 tingkat One unit of 4 storey Office building Pegangan Bebas Freehold 10 8,716/ 18,440 2,650, No. 10 & 8 Jalan Padi Emas 5/2 Bandar Baru UDA Johor Bharu Johor Darul Ta zim Dua unit bangunan Pejabat 3 tingkat Two units of 3 storey Office building Pajakan 99 tahun berakhir pada years lease expiring on ,080/ 8,024 1,800, No. 4 Kompleks Seri Temin Jalan Ibrahim Sungai Petani Kedah Darul Aman Satu unit bangunan Pejabat 4 tingkat One unit of 4 storey Office building Pajakan 99 tahun berakhir pada years lease expiring on ,400/ 5, , No. 16, Jalan Cenderawasih Jalan Kilang Lama Kulim Kedah Darul Aman Satu unit bangunan Pejabat 3 tingkat One unit of 3 storey Office building Pegangan Bebas Freehold 13 1,600/ 4, , Lot 1340, Miri Waterfront Commercial Centre Miri Sarawak Satu unit bangunan Pejabat 4 tingkat One unit of 4 storey Office building Pajakan 60 tahun berakhir years expiring on ,400/ 5,500 1,320,

336 334 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Maklumat Hartanah Particulars of Properties No Lokasi/ Location Penerangan Kegunaan/ Description of Existing Use Hakmilik/ Tenure Usia Bangunan/ Age of Building (tahun/ years) Keluasan Tanah, Kawasan Bina/ Land, Built-up Area (kaki persegi/ square feet) Nilai Buku Bersih pada/ Net Book Value as at (RM) Tarikh Penilaian Semula/ Date of Revaluation 43 No. 6, Jalan Padi Emas 5/2, Bandar Baru UDA Johor Bharu Johor Darul Ta zim Satu unit bangunan Pejabat 3 tingkat One unit of 3 storey Office building Pajakan 99 tahun berakhir pada years lease expiring on ,540/ 4, , No. 148, Kompleks Munshi Abdullah Melaka Satu unit bangunan Pejabat 4 ½ tingkat One unit of 4 ½ storey Office building Pajakan 99 tahun berakhir pada years lease expiring on ,470/ 6, , No & Pusat Perniagaan Inderapura Jalan Tras Raub Pahang Darul Makmur Dua unit bangunan Pejabat 3 tingkat Two units of 3 storey Office building Pajakan 99 tahun berakhir pada years lease expiring on ,218/ 9,280 1,520, Jumlah/Total 247,874,000 * Kawasan Bina/Build-up Area

337 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 335 Maklumat Hartanah Particulars of Properties B Hartanah yang Dihuni-Sendiri / Self-Occupied Property No Lokasi/ Location Penerangan Kegunaan/ Description of Existing Use Hakmilik/ Tenure Usia Bangunan/ Age of Building (tahun/ years) Keluasan Tanah, Kawasan Bina/ Land, Built-up Area (kaki persegi/ square feet) Nilai Buku Bersih pada/ Net Book Value as at (RM) Tarikh Penilaian Semula/ Date of Revaluation 1 No. 435 Jalan Kulas Kuching Sarawak Satu unit Rumah kedai/ Pejabat 4 tingkat One unit of 4 storey Shophouse/Office Pegangan Bebas Freehold 17 1,214/ 4,262 1,250, C Aset Pegangan Untuk Dijual / Asset Held For Sale No Lokasi/ Location Penerangan Kegunaan/ Description of Existing Use Hakmilik/ Tenure Usia Bangunan/ Age of Building (tahun/ years) Keluasan Tanah, Kawasan Bina/ Land, Built-up Area (kaki persegi/ square feet) Nilai Buku Bersih pada/ Net Book Value as at (RM) Tarikh Penilaian Semula/ Date of Revaluation 1 Lot 557 & 559 Plaza Melaka Jalan Hang Tuah Melaka Dua unit Rumah kedai/ Pejabat 4 1/2 tingkat Two units of 4 1/2 storey Shophouse/ Office Pegangan Bebas Freehold 29 3,485/ 14,434 1,340, Lot 6966 & Lot 6967 Blok 59, Muara Tuang Jalan Datok Mohd Musa, Kota Samarahan Sarawak Dua unit Rumah kedai/ Pejabat 3 tingkat Two units of 3 storey Shophouse/Office Pajakan 60 tahun berakhir pada years lease expiring on ,624/ 7,500 1,360, Lot 14(S1) & 15(S1) Indah Point, Section 12 Pulau Indah Industrial Park Klang, Selangor Dua unit Rumah kedai/ Pejabat 4 tingkat Two units of 4 storey Shophouse/Office Pajakan 99 tahun berakhir pada years lease expiring on ,300/ 10, ,

338 336 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Statistik Pegangan Saham Shareholdings Statistics MODAL SAHAM / SHARE CAPITAL Modal Dibenarkan Authorised capital Modal yang diterbitkan dan dibayar sepenuhnya pada 25 Februari 2013 Issued and fully paid-up capital as at 25 February 2013 : 500,000,000 saham biasa bernilai RM1.00 sesaham 500,000,000 ordinary shares of RM1.00 each : 162,817,000 saham biasa bernilai RM1.00 sesaham 162,817,000 ordinary shares of RM1.00 each Jumlah pemegang saham pada 25 Februari 2013 : 2,456 No. of shareholders as at 25 February 2013 Kelas saham Class of shares Hak mengundi Voting right : Saham biasa bernilai RM1.00 sesaham Ordinary shares of RM1.00 each : 1 undi bagi setiap saham biasa 1 vote per ordinary share PEMEGANG-PEMEGANG SAHAM UTAMA (5% DAN LEBIH) PADA 25 FEBRUARI 2013 SUBSTANTIAL SHAREHOLDERS SHAREHOLDINGS (5% AND ABOVE) AS AT 25 FEBRUARY 2013 Nama Pemegang Saham Jumlah Saham Peratus (%) Name of Shareholders Number of Shares Percentage (%) BIMB Holdings Berhad 99,554, Citigroup Nominees (Tempatan) Sdn Bhd 15,046, (Employees Provident Fund Board) Jumlah / Total 114,600, PEGANGAN SAHAM PARA PENGARAH PADA 25 FEBRUARI 2013 DIRECTORS SHAREHOLDINGS AS AT 25 FEBRUARY 2013 Nama Pengarah Jumlah Saham Peratus (%) Name of Directors Number of Shares Percentage (%) Y. Bhg. Dato Paduka Ismee Ismail - - Y. Bhg. Dato Mohamed Hassan Md. Kamil - - Puan Rozaida Omar - - Encik Mahadzir Azizan - - Y. Bhg. Dato Sulaiman Mohd Yusof - - Encik Johan Abdullah - - Encik Zakaria Ismail - - Y. Bhg. Dato Othman Abdullah - -

339 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 337 Statistik Pegangan Saham Shareholdings Statistics ANALISA PEGANGAN SAHAM MENGIKUT SAIZ PADA 25 FEBRUARI 2013 ANALYSIS BY SIZE OF SHAREHOLDINGS AS AT 25 FEBRUARY 2013 Saiz Pegangan Saham Bilangan Peratus (%) Jumlah Peratus (%) Size of Shareholdings Pemegang Saham Percentage (%) Pegangan Saham Percentage (%) Number Number of of Shareholders Shareholdings Kurang dari , Less than , , ,001-10,000 1, ,170, , , ,159, ,001 sehingga kurang daripada 5% saham diterbitkan ,703, ,001 to less than 5% of issued shares 5% dan lebih saham diterbitkan ,355, % and above of issued shares Jumlah/Total 2, ,817, TIGA PULUH (30) PEMEGANG SAHAM TERBESAR PADA 25 FEBRUARI 2013 THIRTY (30) LARGEST SHAREHOLDERS AS AT 25 FEBRUARY 2013 Nama Pemegang Saham Jumlah Saham Peratus (%) Name of Shareholders Number of Shares Percentage (%) BIMB Holdings Berhad 99,554, Citigroup Nominees (Tempatan) Sdn Bhd 13,801, (Employees Provident Fund Board) Bimsec Nominees (Asing) Sdn Bhd 7,000, (Islamic Development Bank) Amsec Nominees (Tempatan) Sdn Bhd 3,896, (Amtrustee Berhad for CIMB Islamic Dali Equity Growth Fund (UT-CIMB-Dali)) AmanahRaya Trustees Berhad 3,003, (Public Islamic Select Treasures Fund) Lembaga Kemajuan Tanah Persekutuan (FELDA) 2,961,

340 338 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report Statistik Pegangan Saham Shareholdings Statistics TIGA PULUH (30) PEMEGANG SAHAM TERBESAR PADA 25 FEBRUARI 2013 (sambungan) THIRTY (30) LARGEST SHAREHOLDERS AS AT 25 FEBRUARY 2013 (continued) Nama Pemegang Saham Jumlah Saham Peratus (%) Name of Shareholders Number of Shares Percentage (%) Koperasi Permodalan Felda Malaysia Berhad 1,438, Cartaban Nominees (Tempatan) Sdn Bhd 1,300, (Exempt An for Eastspring Investments Berhad) RHB Nominees (Asing) Sdn Bhd 1,015, (RUSD Investment Bank Inc) Universal Trustee (Malaysia) Berhad 808, (CIMB-Principal Equity Fund) Maybank Nominees (Tempatan) Sdn Bhd 802, (Etiqa Berhad (Family PRF EQ)) Citigroup Nominees (Tempatan) Sdn Bhd 800, (Employees Provident Fund Board (PHEIM)) CIMB Group Nominees (Tempatan) Sdn Bhd 692, (Amtrustee Berhad for CIMB Islamic Dali Equity Theme Fund) Kenanga Nominees (Tempatan) Sdn Bhd 673, (Pledged Securities Account for Majlis Agama Islam Dan Adat Melayu Terengganu (STC)) Citigroup Nominees (Tempatan) Sdn Bhd 620, (Exempt An for American International Assurance Berhad) Malacca Equity Nominees (Tempatan) Sdn Bhd 613, (Exempt An for Phillip Capital Management Sdn Bhd) HLB Nominees (Tempatan) Sdn Bhd 597, (Pledged Securities Account for Ashfak Ahmad Bin Alarakha) T.O. Lim Holdings Sdn Bhd 570, HSBC Nominees (Asing) Sdn Bhd 527, (Exempt An for The Bank of New York Mellon (Mellon Acct)) Universiti Sains Malaysia 500, Meng Hin Holdings Sdn Bhd 489,

341 Syarikat Malaysia Berhad ( K) Laporan Tahunan 2012 Annual Report 339 Statistik Pegangan Saham Shareholdings Statistics TIGA PULUH (30) PEMEGANG SAHAM TERBESAR PADA 25 FEBRUARI 2013 (sambungan) THIRTY (30) LARGEST SHAREHOLDERS AS AT 25 FEBRUARY 2013 (continued) Nama Pemegang Saham Jumlah Saham Peratus (%) Name of Shareholders Number of Shares Percentage (%) Citigroup Nominees (Tempatan) Sdn Bhd 444, (Employees Provident Fund Board (CIMB PRINT)) Majlis Agama Islam Dan Adat Melayu Perak Darul Ridzuan 400, Amin Baitulmal Johor 400, Miss Wipaporn Limprana 350, Citigroup Nominees (Asing) Sdn Bhd 317, (CBHK for Premium Asia Fund) Universal Trustee (Malaysia) Berhad 310, (CIMB Islamic Small Cap Fund) Ashfak Ahmad Bin Alarakha 309, Maybank Nominees (Tempatan) Sdn Bhd 284, (Etiqa Berhad (General Fund)) Citigroup Nominees (Asing) Sdn Bhd 268, (CBNY for DFA Emerging Markets Small Cap Series) Jumlah/Total 144,747,

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