Wice Freight Services (Thailand) Company Limited and its subsidiary Report and consolidated 31 December 2014
Independent Auditor's Report To the Shareholders of Wice Freight Services (Thailand) Company Limited I have audited the accompanying consolidated of Wice Freight Services (Thailand) Company Limited and its subsidiary, which comprise the consolidated statement of financial position as at 31 December 2014, and the related consolidated statements of comprehensive income, changes in shareholders equity and cash flows for the year then ended,anda summary of significant accounting policies and other explanatory information, and have also audited the separate of Wice Freight Services (Thailand) Company Limited for the same period. Management's Responsibility for the Financial Statements Management is responsible for the preparation and fair presentation of these in accordance with Thai Financial Reporting Standards, and for such internal control as management determines is necessary to enable the preparation of that are free from material misstatement, whether due to fraud or error. Auditor's Responsibility My responsibility is to express an opinion on these based on my audit. I conducted my audit in accordance with Thai Standards on Auditing. Those standards require that I comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the are free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the. The procedures selected depend on the auditor's judgement, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity's preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity's internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by management, as well as evaluating the overall presentation of the.
I believe that the audit evidence I have obtained is sufficient and appropriate to provide a basis for my audit opinion. Opinion In my opinion, the referred to above present fairly, in all material respects, the financial position of Wice Freight Services (Thailand) Company Limited and its subsidiary and of Wice Freight Services (Thailand) Company Limited as at 31 December 2014, and their financial performance and cash flows for the year then ended, in accordance with Thai Financial Reporting Standards. Pimjai Manitkajohnkit Certified Public Accountant (Thailand) No. 4521 EY Office Limited Bangkok:24 February 2015 2
Wice Freight Services (Thailand) Company Limited and its subsidiary Statement of financial position As at 31 December 2014 (Unit: Baht) Consolidated Separate Note 2014 2013 2014 2013 Assets Current assets Cash and cash equivalents 7 80,841,218 48,526,628 38,817,844 34,614,716 Current investments 8 41,139,937 50,129,946 35,974 10,000,493 Trade and other receivables 6, 9 108,340,107 110,490,769 80,206,888 71,703,548 Short-term loans - 910,000-910,000 Other current assets 2,346,400 2,597,953 2,088,388 2,202,921 Total current assets 232,667,662 212,655,296 121,149,094 119,431,678 Non-current assets Restricted bank deposits 10 1,080,862 1,471,750 1,080,862 971,750 Investment in subsidiary 11 - - 53,998,000 53,998,000 Property, plant and equipment 12 123,701,804 77,534,242 122,345,216 77,168,525 Intangible assets 13 77,908 108,520 45,241 95,356 Deferred tax assets 20 540,322 968,711 360,400 734,669 Other non-current assets 453,204 217,080 176,000 178,580 Total non-current assets 125,854,100 80,300,303 178,005,719 133,146,880 Total assets 358,521,762 292,955,599 299,154,813 252,578,558 The accompanying notes are an integral part of the. Chudet Kongsoonthorn
Wice Freight Services (Thailand) Company Limited and its subsidiary Statement of financial position (Continued) As at 31 December 2014 (Unit: Baht) Consolidated Separate Note 2014 2013 2014 2013 Liabilities and shareholders' equity Current liabilities Trade and other payables 6, 14 37,600,212 47,663,576 28,168,969 31,391,885 Current portion of liabilities under finance lease agreements 15 11,445,579 6,720,568 11,380,779 6,720,568 Income tax payable 4,633,140 8,532,706 410 1,073,187 Other current liabilities 8,422,210 20,482,898 6,438,471 15,161,114 Total current liabilities 62,101,141 83,399,748 45,988,629 54,346,754 Non-current liabilities Liabilities under finance lease agreements - net of current portion 15 12,248,916 12,449,835 12,221,916 12,449,835 Provision for long-term employee benefits 16 5,742,901 4,120,465 3,492,844 2,492,514 Other non-current liabilities 207,446-207,446 - Total non-current liabilities 18,199,263 16,570,300 15,922,206 14,942,349 Total liabilities 80,300,404 99,970,048 61,910,835 69,289,103 Shareholders' equity Share capital 17 Registered 20,800,000 ordinary shares of Baht 10 each (2013: 18,000,000 ordinary shares of Baht 10 each) 208,000,000 180,000,000 208,000,000 180,000,000 Issued and paid-up 20,800,000 ordinary shares of Baht 10 each (2013: 18,000,000 ordinary shares of Baht 10 each) 208,000,000 180,000,000 208,000,000 180,000,000 Retained earnings (Deficit) Appropriated-statutory reserve 18 6,173,088 5,394,788 6,173,088 5,394,788 Unappropriated 53,572,564 (2,105,727) 23,070,890 (2,105,727) Other components of shareholders' equity 10,475,706 9,696,490-394 Total shareholders' equity 278,221,358 192,985,551 237,243,978 183,289,455 Total liabilities and shareholders' equity 358,521,762 292,955,599 299,154,813 252,578,558 - - - - The accompanying notes are an integral part of the. Chudet Kongsoonthorn
Wice Freight Services (Thailand) Company Limited and its subsidiary Statement of comprehensive income For the year ended 31 December 2014 (Unit: Baht) Consolidated Separate For the period as from For the period as fro For the year ended29 November 2013 tofor the year ended29 November 2013 Note 31 December 2014 31 December 2013 31 December 2014 31 December 2013 Profit or loss: Revenues Service income 6 670,202,699 52,970,603 450,597,507 32,354,640 Dividend income 6, 11 - - 6,336,665 - Other income 6 6,568,976 2,137,574 10,188,819 1,342,448 Total revenues 676,771,675 55,108,177 467,122,991 33,697,088 Expenses Cost of services 6 497,072,550 37,904,796 355,948,526 24,867,169 Selling expenses 34,719,460 2,044,174 23,229,649 2,044,174 Administrative expenses 6 64,329,933 9,521,178 47,138,411 4,365,387 Total expenses 596,121,943 49,470,148 426,316,586 31,276,730 Profit before finance cost and income tax expenses 80,649,732 5,638,029 40,806,405 2,420,358 Finance cost (1,767,444) (88,982) (1,767,444) (88,982) Profit before income tax expenses 78,882,288 5,549,047 39,038,961 2,331,376 Income tax expenses 20 (16,440,697) (1,279,736) (7,099,044) (585,441) Profit for the year/period 62,441,591 4,269,311 31,939,917 1,745,935 Other comprehensive income: Gain on changes in value of available-for-sale investments (reversal) 8 974,019 (442,542) (493) (900,282) Income tax effect 20 (194,803) 88,508 99 180,056 Other comprehensive income for the year/period 779,216 (354,034) (394) (720,226) Total comprehensive income for the year/period 63,220,807 3,915,277 31,939,523 1,025,709 The accompanying notes are an integral part of the. Chudet Kongsoonthorn
Wice Freight Services (Thailand) Company Limited and its subsidiary Statement of comprehensive income (Continued) For the year ended 31 December 2014 (Unit: Baht) Consolidated Separate For the period as from For the period as fro For the year ended29 November 2013 tofor the year ended29 November 2013 Note 31 December 2014 31 December 2013 31 December 2014 31 December 2013 Profit attributable to: Equity holders of the Company 62,441,591 1,745,935 31,939,917 1,745,935 Non-controlling interests of the subsidiary - 2,523,376 62,441,591 4,269,311 Total comprehensive income attributable to: Equity holders of the Company 63,220,807 1,025,709 31,939,523 1,025,709 Non-controlling interests of the subsidiary - 2,889,568 63,220,807 3,915,277 Earnings per share 21 Basic earnings per share Profit attributable to equity holders of the Company 3.21 0.33 1.64 0.33 Weighted average number of ordinary shares (shares) 19,459,452 5,225,806 19,459,452 5,225,806 The accompanying notes are an integral part of the. Chudet Kongsoonthorn
Wice Freight Services (Thailand) Company Limited and its subsidiary Cash flow statement For the year ended 31 December 2014 (Unit: Baht) Consolidated Separate For the period as from For the period as fro For the year ended29 November 2013 tofor the year ended29 November 2013 31 December 2014 31 December 2013 31 December 2014 31 December 2013 Cash flows from operating activities Profit before tax 78,882,288 5,549,047 39,038,961 2,331,376 Adjustments to reconcile profit before tax to net cash provided by (paid from) operating activities: Depreciation and amortisation 10,620,761 951,482 10,338,214 948,186 Loss on impairment of assets 88,619-6,823 - Gain on sales of equipment (514,018) - (514,018) - Loss from write-off of equipment 29,948-29,948 - Gain on sales of current investments (22,263) (935,593) (22,263) (935,593) Long-term employee benefits expense 1,759,554 113,099 1,117,672 79,285 Unrealised loss (gain) on exchange (507,024) (970,458) 55,612 (498,830) Interest income (274,149) (22,499) (163,363) (22,499) Dividend income - - (6,336,665) - Interest expenses 1,767,444 88,982 1,767,444 88,982 Profit from operating activities before changes in operating assets and liabilities 91,831,160 4,774,060 45,318,365 1,990,907 Operating assets (increase) decrease Trade and other receivables 2,770,106 (2,844,029) (8,434,284) 5,121,420 Other current assets 244,730 618,172 107,710 589,270 Other non-current assets (317,920) 308,673 2,580 - Operating liabilities increase (decrease) Trade and other payables (10,176,267) (7,149,038) (3,348,067) (7,667,012) Other current liabilities (12,060,688) 14,534,327 (8,722,643) 9,797,973 Provision for long-term employee benefits (137,118) (86,400) (117,342) (86,400) Other non-current liabilities 207,446-207,446 - Cash flows from operating activities 72,361,449 10,155,765 25,013,765 9,746,158 Cash paid for corporate income tax (20,106,676) (473,307) (7,797,453) (473,307) Net cash flows from operating activities 52,254,773 9,682,458 17,216,312 9,272,851 The accompanying notes are an integral part of the. Chudet Kongsoonthorn
Wice Freight Services (Thailand) Company Limited and its subsidiary Cash flow statement (Continued) For the year ended 31 December 2014 (Unit: Baht) Consolidated Separate For the period as from For the period as fro For the year ended29 November 2013 tofor the year ended29 November 2013 31 December 2014 31 December 2013 31 December 2014 31 December 2013 Cash flows from investing activities Increase in current investments (35,974) - (35,974) - Decrease in short-term loans 910,000 20,000 910,000 20,000 Decrease (increase) in restricted bank deposits 390,888 109,112 (109,112) 109,112 Increase in investment in subsidiary - - - (53,998,000) Cash paid to former shareholders of the subsidiary - (53,998,000) - - Acquisitions of property, plant and equipment (38,125,660) (2,638,920) (37,274,346) (2,638,920) Acquisitions of intangible asset - (23,357) - (23,357) Proceeds from sales of equipment and intangible assets 514,019-955,625 - Interest income 274,633 22,499 163,847 22,499 Dividend income - - 6,336,665 - Proceeds from sales of current investments 10,022,263 26,484,258 10,022,263 26,484,258 Cash paid for acquisitions of current investments - (34,000,000) - (10,000,000) Net cash flows used in investing activities (26,049,831) (64,024,408) (19,031,032) (40,024,408) Cash flows from financing activities Repayments of short-term loans from related parties - (33,400,000) - (33,400,000) Repayments made on liabilities under finance lease agreements (14,137,908) (543,913) (14,229,708) (543,913) Proceeds from increase in share capital 28,000,000 165,000,000 28,000,000 165,000,000 Proceeds from increase in share capital of the subsidiary from former shareholders - 49,000,000 - - Interest expenses (1,767,444) (88,982) (1,767,444) (88,982) Dividend paid (5,985,000) (101,043,444) (5,985,000) (101,043,444) Dividend paid to former shareholders of the subsidiary - (44,343,534) - - Net cash flows from financing activities 6,109,648 34,580,127 6,017,848 29,923,661 Net increase (decrease) in cash and cash equivalents 32,314,590 (19,761,823) 4,203,128 (827,896) Cash and cash equivalents at beginning of year/period 48,526,628 68,288,451 34,614,716 35,442,612 Cash and cash equivalents at end of year/period (Note 7) 80,841,218 48,526,628 38,817,844 34,614,716 Supplemental cash flows information Non-cash items consist of Acquisitions of motor vehicles under finance lease agreements 18,662,000-18,662,000 - The accompanying notes are an integral part of the. Chudet Kongsoonthorn
Wice Freight Services (Thailand) Company Limited and its subsidiary Statement of changes in shareholders' equity For the year ended 31 December 2014 (Unit: Baht) Consolidated Equity attributable to owners of the Company Other components of equity Other comprehensive income Surplus on changes Surplus on change Total other Total equity Equity attributable Equity attributable Issued and in value of Surplus on business in percentage components of attributable to to former to non-controlling Total paid-up Retained earnings (Deficit) available-for-sale combination under shareholding shareholders' owners of shareholders interests of shareholders' Note share capital Appropriated Unappropriated investments common control in subsidiary equity the Company of the subsidiary the subsidiary equity Balance as at 29 Novemebr 2013 15,000,000 76,712 102,509,858 720,620 - - 720,620 118,307,190 32,995,144 21,996,763 173,299,097 Increase in share capital 17 165,000,000 - - - - - - 165,000,000 - - 165,000,000 Unappropriated retained earnings transferred to statutory reserve 18-5,318,076 (5,318,076) - - - - - - - - Dividend paid 24 - - (101,043,444) - - - - (101,043,444) - - (101,043,444) Total comprehensive income for the period - - 1,745,935 (720,226) - - (720,226) 1,025,709 1,733,741 1,155,827 3,915,277 Surplus on business combination under common control - - - - 5,597,942-5,597,942 5,597,942 - - 5,597,942 Surplus on change in percentage shareholding in subsidiary - - - - - 3,731,962 3,731,962 3,731,962 - - 3,731,962 Decrease in equity attributable to former shareholders of the subsidiary from business combination under common control - - - 219,715 - - 219,715 219,715 (34,728,885) - (34,509,170) Decrease in equity attributable to non-controlling interests of the subsidiary - - - 146,477 - - 146,477 146,477 - (23,152,590) (23,006,113) Balance as at 31 December 2013 180,000,000 5,394,788 (2,105,727) 366,586 5,597,942 3,731,962 9,696,490 192,985,551 - - 192,985,551 Balance as at 1 January 2014 180,000,000 5,394,788 (2,105,727) 366,586 5,597,942 3,731,962 9,696,490 192,985,551 - - 192,985,551 Increase in share capital 17 28,000,000 - - - - - - 28,000,000 - - 28,000,000 Unappropriated retained earnings transferred to statutory reserve 18-778,300 (778,300) - - - - - - - - Dividend paid 24 - - (5,985,000) - - - - (5,985,000) - - (5,985,000) Total comprehensive income for the year - - 62,441,591 779,216 - - 779,216 63,220,807 - - 63,220,807 Balance as at 31 December 2014 208,000,000 6,173,088 53,572,564 1,145,802 5,597,942 3,731,962 10,475,706 278,221,358 - - 278,221,358 The accompanying notes are an integral part of the. Chudet Kongsoonthorn
Wice Freight Services (Thailand) Company Limited and its subsidiary Statement of changes in shareholders' equity (Continued) For the year ended 31 December 2014 (Unit: Baht) Separate Other components of equity Other comprehensive income Surplus on changes Total other Issued and in value of components of Total paid-up Retained earnings (Deficit) available-for-sale shareholders' shareholders' Note share capital Appropriated Unappropriated investments equity equity Balance as at 29 Novemebr 2013 15,000,000 76,712 102,509,858 720,620 720,620 118,307,190 Increase in share capital 17 165,000,000 - - - - 165,000,000 Unappropriated retained earnings transferred to statutory reserve 18-5,318,076 (5,318,076) - - - Dividend paid 24 - - (101,043,444) - - (101,043,444) Total comprehensive income for the period - - 1,745,935 (720,226) (720,226) 1,025,709 Balance as at 31 December 2013 180,000,000 5,394,788 (2,105,727) 394 394 183,289,455 Balance as at 1 January 2014 180,000,000 5,394,788 (2,105,727) 394 394 183,289,455 Increase in share capital 17 28,000,000 - - - - 28,000,000 Unappropriated retained earnings transferred to statutory reserve 18-778,300 (778,300) - - - Dividend paid 24 - - (5,985,000) - - (5,985,000) Total comprehensive income for the year - - 31,939,917 (394) (394) 31,939,523 Balance as at 31 December 2014 208,000,000 6,173,088 23,070,890 - - 237,243,978 - The accompanying notes are an integral part of the. Chudet Kongsoonthorn
Wice Freight Services (Thailand) Company Limited and its subsidiary Notes to consolidated For the year ended31 December 2014 1. General information Wice Freight Services (Thailand) Company Limited ( the Company ) is a limited company incorporated and domiciled in Thailand. The Company is principally engaged in an international freight forwarding, customs broker, inland transportation, multimodal transport operator and all freight related services for imports and exports. The registered office of the Company is at 88/8 Nonsee Road, Chong-nonsee, Yannawa, Bangkok. 2. Basis of preparation 2.1 The have been prepared in accordance with Thai Financial Reporting Standards enunciated under the Accounting Professions Act B. E. 2547 and their presentation has been made in compliance with the stipulations of the Notification of the Department of Business Development dated 28 September 2011, issued under the Accounting Act B.E. 2543. The in Thai language are the official statutory of the Company. The in English language have been translated from the Thai language. The have been prepared on a historical cost basis except where otherwise disclosed in the accounting policies. 2.2 Basisof consolidation a) The consolidated include the ofwice Freight Services ( Thailand) Company Limited( the Company ) and the following subsidiary company ( the subsidiary ): Company s name Sun Express (Thailand) Company Limited Nature of business Freight forwarder and all freight related services for imports and exports Country of incorporation Percentage of shareholding 2014 2013 % % Thailand 99.99 99.99 1
b) Subsidiaryis fully consolidated, being the date on which the Company obtains control, and continue to be consolidated until the date when such control ceases. c) The of the subsidiary is prepared using the samesignificant accounting policies as the Company. d) Material balances and transactions between the Company and its subsidiary company have been eliminated from the consolidated. e) Non-controlling interests represent the portion of profit or loss and net assets of the subsidiary that are not held by the Company and are presented separately in the consolidated profit or loss and within equity in the consolidated statement of financial position. 2.3 The separate, which present investments in a subsidiary,has been prepared solely for the benefit of the public. 3. New financial reporting standards Below is a summary of financial reporting standards that became effective in the current accounting year and those that will become effective in the future. ( a) Financial reporting standards that became effective in the current accounting year Conceptual Framework for Financial Reporting (revised 2014) Accounting Standards: TAS 1 (revised 2012) Presentation of Financial Statements TAS 7 (revised 2012) Statement of Cash Flows TAS 12 (revised 2012) Income Taxes TAS 17 (revised 2012) Leases TAS 18 (revised 2012) Revenue TAS 19 (revised 2012) Employee Benefits TAS 21 (revised 2012) The Effects of Changes in Foreign Exchange Rates TAS 24 (revised 2012) Related Party Disclosures TAS 28 (revised 2012) Investments in Associates TAS 31 (revised 2012) Interests in Joint Ventures TAS 34 (revised 2012) Interim Financial Reporting TAS 36 (revised 2012) Impairment of Assets TAS 38 (revised 2012) Intangible Assets 2
Financial Reporting Standards: TFRS 2 (revised 2012) Share-based Payment TFRS 3 (revised 2012) Business Combinations TFRS 5 (revised 2012) Non-current Assets Held for Sale and Discontinued Operations TFRS 8 (revised 2012) Operating Segments Accounting Standard Interpretations: TSIC 15 Operating Leases - Incentives TSIC 27 Evaluating the Substance of Transactions Involving the Legal Form of a Lease TSIC 29 Service Concession Arrangements: Disclosures TSIC 32 Intangible Assets - Web Site Costs Financial Reporting Standard Interpretations: TFRIC 1 Changes in Existing Decommissioning, Restoration and Similar Liabilities TFRIC 4 Determining whether an Arrangement contains a Lease TFRIC 5 Rights to Interests arising from Decommissioning, Restoration and Environmental Rehabilitation Funds TFRIC 7 Applying the Restatement Approach under TAS 29 Financial Reporting in Hyperinflationary Economies TFRIC 10 Interim Financial Reporting and Impairment TFRIC 12 Service Concession Arrangements TFRIC 13 Customer Loyalty Programmes TFRIC 17 Distributions of Non-cash Assets to Owners TFRIC 18 Transfers of Assets from Customers Accounting Treatment Guidance for Stock Dividend These financial reporting standards were amended primarily to align their content with the corresponding International Financial Reporting Standards. Most of the changes were directed towards revision of wording and terminology, and provision of interpretations and accounting guidance to users of the accounting standards. These financial reporting standards do not have any significant impact on the. 3
(b) Financial reporting standards that will become effective in the future The Federation of Accounting Professions has issued a number ofrevised and new financial reporting standards that become effective for fiscal years beginning on or after 1 January 2015. These financial reporting standards were aimed at alignment with the corresponding International Financial Reporting Standards, with most of the changes directed towards revision of wording and terminology, and provision of interpretations and accounting guidance to users of accounting standards. The management of the Companyand its subsidiary believes they will not have any significant impact on the in the year in which they are adopted. However, some of these financial reporting standards involve changes to key principles, as discussed below: TAS 19 (revised 2014) Employee Benefits This revised accounting standard requires that the entity recognise actuarial gains and losses immediately in other comprehensive income while the existing accounting standard allows the entity to recognise such gains and losses immediately in profit or loss, or in other comprehensive income, or to recognise them gradually in profit or loss. This revised accounting standard does not have any impact on the as the Company and its subsidiary already recognised actuarial gains and losses immediately in other comprehensive income. TFRS 10 Consolidated Financial Statements TFRS 10 prescribes requirements for the preparation of consolidated and replaces the part dealing with consolidated as included in TAS 27 Consolidated and Separate Financial Statements. This financial reporting standard changes the principles used in considering whether control exists. Under this financial reporting standard, an investor is deemed to have control over an investee if it has rights, or is exposed, to variable returns from its involvement with the investee, and it has the ability to direct the activities that affect the amount of its returns, even if it holds less than half of the shares or voting rights. This important change requires the management to exercise a lot of judgement when reviewing whether the Company and its subsidiary have control over the investees and determine which entities have to be included for preparation of the consolidated. The management of the Company believes that this financial reporting standard will not have any significant impact on the Company's and its subsidiary s. 4
TFRS 11 Joint Arrangements TFRS 11 supersedes TAS 31 Interests in Joint Ventures. This financial reporting standard requires an entity to account for an investment in a jointly controlled entity that meets the definition of a joint venture using the equity method, while TAS 31 allows the entity to apply either the proportionate consolidation method or the equity method to account for such an investment. The management of the Company believes that this financial reporting standard has no any impact on the Company's and its subsidiary's. TFRS 12 Disclosure of Interests in Other Entities This financial reporting standard stipulates disclosures relating to an entity s interests in subsidiaries, joint arrangements and associates, including structured entities. This financial reporting standard therefore has no financial impact to the of the Company and its subsidiary. TFRS 13 Fair Value Measurement This financial reporting standard provides guidance on how to measure fair value and stipulates disclosuresrelated to fair value measurements. Entities are to apply the guidance under this financial reporting standard if they are required by other financial reporting standards to measure their assets or liabilities at fair value. The effect of the change from the adoption of this financial reporting standard is to be recognised prospectively. Based on the preliminary analysis, the management of the Company believes that this financial reporting standard will not have any significant impact on the Company'sand its subsidiary s. 4. Significant accounting policies 4.1 Revenue recognition Rendering of services Service revenue is recognisedwhen services have been rendered. Interest income Interest income is recognisedon an accrual basis based on the effective interest rate. Dividend incomes Dividend incomes are recognised when the right to receive the dividends is established. 5
4.2 Cash and cash equivalents Cash and cash equivalents consist of cash in hand and at banks, and all highly liquid investments with an original maturity of three months or less and not subject to withdrawal restrictions. 4.3 Trade and other receivables Trade and other receivables are stated at the net realisable value. Allowance for doubtful accounts is provided for the estimated losses that may be incurred in collection of receivables. The allowance is generally based on collection experience and analysis of debt aging. 4.4 Investments a) Investments in available-for-sale securities are stated at fair value. Changes in the fair value of these securities are recorded in other comprehensive income, and will be recorded inprofit or loss when the securities are sold. b) Investment in a subsidiary is accounted for in the separate using the cost method less allowance for loss on impairment of investment (if any). The fair value of investment unit is based on the net assets value of investments at the end of reporting period. The first-in,first-out method is used for computation of the cost of investments. On disposal of an investment, the difference between net disposal proceeds and the carrying amount of the investment is recognisedin profit or loss. 4.5 Property, plant and equipment/depreciation Land is stated at cost. Buildings and equipment are stated at cost less accumulated depreciation and allowance for loss on impairment of assets ( if any).depreciation of buildings and equipment is calculated by reference to their costson the straight-line basis over the following estimated useful lives: Buildings and yard Furniture, fixtures and office equipment Computers Motor vehicles 20 years 5 years 3-5 years 5-10 years Depreciation is included in determining income. No depreciation is provided on land, construction in progress and assets under installation. 6
An item of property, plant and equipment is derecognised upon disposal or when no future economic benefits are expected from its use or disposal.any gain or loss arising on disposal of an assetis included in profit or losswhen the asset is derecognised. 4.6 Intangible assets Intangible assets are carried at cost less any accumulated amortisation and any accumulated impairment losses (if any).intangible assets with finite lives are amortised on a systematic basis over the economic useful life and tested for impairment whenever there is an indication that the intangible asset may be impaired. The amortisation period and the amortisation method of such intangible assetsare reviewed at least at each financial year end. The amortisation expense is charged to profit or loss on the straight-line basis over the economic useful life as follows: Computer software Useful lives 3-5 years 4.7 Related party transactions Related parties comprise enterprises and individuals that control, or are controlled by, the Company, whether directly or indirectly, or which are under common control with the Company. They also include associated companies and individuals which directly or indirectly own a voting interest in the Company that gives them significant influence over the Company, key management personnel, directors, and officers with authority in the planning and direction of the Company s operations. 4.8 Long-term leases Leases of property, plant or equipment which transfer substantially all the risks and rewards of ownership are classified as finance leases. Finance leases are capitalised at the lower of the fair value of the leased assets and the present value of the minimum lease payments. The outstanding rental obligations, net of finance charges, are included inlongterm payables, while the interest element is charged to profit or loss over the lease period. The assets acquired under finance leases are depreciated over the useful life of the leased asset. Leases of property, plant or equipment which do not transfer substantially all the risks and rewards of ownership are classified as operating leases. Operating lease payments are recognised as an expense in profit or loss on the straight-line basis over the lease term. 7
4.9 Foreign currencies The consolidated and separate are presented in Baht, which is also the Company s functional currency. Items of each entity included in the consolidated are measured using the functional currency of that entity. Transactions in foreign currencies are translated into Baht at the exchange rate ruling at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies are translated into Baht at the exchange rate ruling at the end of reporting period. Gains and losses on exchange are included in determining income. 4.10 Impairment of assets At the end of each reporting period, the Company and its subsidiary perform impairment reviews in respect of the property, plant and equipment and intangible assets whenever events or changes in circumstances indicate that an asset may be impaired. An impairment loss is recognised when the recoverable amount of an asset, which is the higher of the asset s fair value less costs to sell and its value in use, is less than the carrying amount. An impairment loss is recognised in profit or loss. 4.11 Employee benefits Short-term employee benefits Salaries, wages, bonuses and contributions to the social security fund are recognised as expenses when incurred. Post-employment benefitsand other long-term employee benefits Defined contribution plans The Company and its subsidiary and its employees have jointly established a provident fund. The fund is monthly contributed by employees and by the Company and its subsidiary. The fund s assets are held in a separate trust fund and the Company and its subsidiary s contributions are recognised as expenses when incurred. 8
Defined benefit plansand other long-term employee benefits The Company and its subsidiaryhave obligations in respect of the severance payments it must make to employees upon retirement under labor law and other employee benefit plans. The Company and its subsidiary treat these severance payment obligations as a defined benefit plan.in addition, the Company and its subsidiary provide other long-term employee benefit plan, namely long service awards. The obligation under the defined benefit plan and other long-term employee benefit plans is determined by a professionally qualified independent actuary based on actuarial techniques, using the projected unit credit method. Actuarial gains and losses arising from post-employment benefits are recognised immediately in other comprehensive income. While actuarial gains and losses arising from other long-term employee benefits are recognised immediately in profit and loss. 4.12 Provisions Provisions are recognised when the Company and its subsidiary have a present obligation as a result of a past event, it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation, and a reliable estimate can be made of the amount of the obligation. 4.13 Income tax Income tax expense represents the sum of corporate income tax currently payable and deferred tax. Current tax Current income tax is provided in the accounts at the amount expected to be paid to the taxation authorities, based on taxable profits determined in accordance with tax legislation. Deferred tax Deferred income tax is provided on temporary differences between the tax bases of assets and liabilities and their carrying amounts at the end of each reporting period, using the tax rates enacted at the end of the reporting period. The Company and its subsidiaryrecognise deferred tax liabilities for all taxable temporary differences while they recognise deferred tax assets for all deductible temporary differences and tax losses carried forward to the extent that it is probable that future taxable profit will be available against which such deductible temporary differences and tax losses carried forward can be utilised. 9
At each reporting date, the Company and its subsidiary review and reduce the carrying amount of deferred tax assets to the extent that it is no longer probable that sufficient taxable profit will be available to allow all or part of the deferred tax asset to be utilised. The Company and its subsidiary record deferred tax directly to shareholders' equity if the tax relates to items that are recorded directly to shareholders' equity. 5. Significant accounting judgements and estimates The preparation of in conformity with financial reporting standards at times requires management to make subjective judgements and estimates regarding matters that are inherently uncertain. These judgements and estimates affect reported amounts and disclosures; and actual results could differ from these estimates. Significant judgements and estimates are as follows: Leases In determining whether a lease is to be classified as an operating lease or finance lease, the management is required to use judgement regarding whether significant risk and rewards of ownership of the leased asset has been transferred, taking into consideration terms and conditions of the arrangement. Allowance for doubtful accounts In determining an allowance for doubtful accounts, the management needs to make judgement and estimates based upon, among other things, past collection history, aging profile of outstanding debts and the prevailing economic condition. Impairment of equity investments The Company and its subsidiary treat available-for-sale investments as impaired when there has beena significant or prolonged decline in the fair value below their cost or where other objective evidence of impairment exists. The determination of what is significant or prolonged requires judgement of the management. Property, plant and equipment/depreciation In determining depreciation of plant and equipment, the management is required to make estimates of the useful lives and residual values of the plantand equipment and to review estimate useful lives and residual values when there are any changes. 10
In addition, the management is required to review property, plantand equipment for impairment on a periodical basis and record impairment losses when it is determined that their recoverable amount is lower than the carrying amount. This requires judgements regarding forecast of future revenues andexpenses relating to the assets subject to the review. Intangible assets The initial recognition and measurement of intangible assets, and subsequent impairment testing, require management to make estimates of cash flows to be generated by the asset or the cash generating units and to choose a suitable discount rate in order to calculate the present value of those cash flows. Deferred tax assets Deferred tax assets are recognised for deductible temporary differences and unused tax losses to the extent that it is probable that taxable profit will be available against which the temporary differences and losses can be utilised. Significant management judgement is required to determine the amount of deferred tax assets that can be recognised, based upon the likely timing and level of estimate future taxable profits. Post-employment benefits under defined benefit plansand other long-term employee benefits The obligation under the defined benefit plans and other long-term employee benefit plansare determined based on actuarial techniques. Such determination is made based on various assumptions, including discount rate, future salary increase rate, mortality rate and staff turnover rate. 6. Related party transactions During the year/period, the Company and its subsidiary had significant business transactions with related parties. Such transactions arose in the ordinary course of business and were concluded on commercial terms and bases agreed upon between the Company, its subsidiary and those related parties. The relationship between the Company and the related parties are summarised below. Name of related parties Sun Express (Thailand) Company Limited Body of Person V Land Sun Express Logistics Pte Ltd. Relationship with the Company Subsidiary Related person Common shareholders 11
During the year ended 31 December 2014 and for the period as from 29 November 2013 to 31 December 2013, such significant transactions are summarised below. (Unit: Million Baht) Consolidated financial statements Separate Transfer Pricing Policy 2014 2013 2014 2013 Transactions with subsidiary (eliminated from the consolidated ) Service income - - 3.6 0.5 Close to market price Rental income and other service - - 7.3 - As stipulated in the agreement Dividend income - - 6.3 - As declared Cost of services - - 2.5 - Close to market price Sales of fixed assets and intangible assets - - 0.4 - At net book value Transactions with related person and company Service income 15.0 1.3 - - Close to market price Cost of services 19.3 - - - Close tomarket price Land and buildings rental expenses 1.4 0.2 1.4 0.2 As stipulated in the agreement Transactions with management and directors Land and buildings rental expenses 0.9-0.9 - As stipulated in the agreement Acquisition of land 23.8-23.8 - At appraisal price As at 31 December 2014 and 2013, the balances of the accounts between the Company, its subsidiary and those related parties are as follows: Consolidated Separate financial statements 2014 2013 2014 2013 Trade and other receivables - related party (Note 9) Subsidiary - - 3,738 795 Related company 1,778 4,473 - - Total trade and other receivables - related party 1,778 4,473 3,738 795 Trade and other payables - related parties (Note 14) Subsidiary - - 865 295 Related person and company 1,150 7,797-4,670 Management and directors - 780-480 Total trade and other payables - related parties 1,150 8,577 865 5,445 12
Directors and management s benefits During the year ended31 December 2014 and for the period as from 29 November 2013 to 31 December 2013,the Company and its subsidiaryhademployee benefit expenses payable to their directors and managementas below. Consolidated Separate 2014 2013 2014 2013 Short-term employee benefits 21,360 742 9,320 430 Post-employment benefits 709 41 482 27 Total 22,069 783 9,802 457 7. Cash and cash equivalents Consolidated financial Separate financial statements statements 2014 2013 2014 2013 Cash - 75-75 Bank deposits 80,841 48,452 38,818 34,540 Total 80,841 48,527 38,818 34,615 As at 31 December 2014, bank deposits in saving accounts and fixed deposits carried interests between 0.35% and 0.37% per annum (2013: 0.65% and 2.30% per annum). 8. Current investments Consolidated Separate 2014 2013 2014 2013 Investments in open-end fund - Cost 39,672 49,672-10,000 Add:Unrealised gain on changes in value of investments 1,432 458 - - Investments in open-end fund - Fair value 41,104 50,130-10,000 Fix deposits 36-36 - Total current investments 41,140 50,130 36 10,000 13
During the year ended 31 December 2014, the Company sold available-for-sale securities with book values totaling Baht 10,000,000(For the period as from 29 November 2013 to 31 December 2013: Baht 25,548,665) and recognised gains on the sales amounting to Baht 22,263(For the period as from 29 November 2013 to 31 December 2013: Baht 935,593) in profit or loss. This amount included gains transferred from gain on valuation of available-forsale securities in other comprehensive income, amounting to Baht 493(For the period as from 29 November 2013 to 31 December 2013: Baht 900,282). 9. Trade and other receivables Consolidated financial Separate statements 2014 2013 2014 2013 Trade accounts receivable - related party Aged on the basis of due dates Not yet due 1,733 2,452 135 204 Past due Up to 3 months 45 2,021 31 184 Total trade accounts receivable - related party 1,778 4,473 166 388 Trade accounts receivable - unrelated parties Aged on the basis of due dates Not yet due 53,870 49,926 35,779 28,356 Past due Up to 3 months 30,272 35,451 20,599 25,167 3-6 months 2,946 1,532 2,749 942 6-12months 766 644 711 629 Over12months 1,189 3,534 1,189 3,473 Total 89,043 91,087 61,027 58,567 Less: Allowance for doubtful debts (1,181) (1,181) (1,181) (1,181) Total trade accounts receivable - unrelated parties, net 87,862 89,906 59,846 57,386 Total trade accounts receivable - net 89,640 94,379 60,012 57,774 Other receivables Advance receivables - related parties - - 62 191 Advance receivables - unrelated parties 18,654 16,073 16,577 13,484 Other receivables - related parties - - 3,510 216 Other receivables - unrelated parties 46 39 46 39 Total other receivables 18,700 16,112 20,195 13,930 Trade and other receivables - net 108,340 110,491 80,207 71,704 14
10. Restricted bank deposits These represent fixed deposits pledged with the banks to secure a fuel credit card and bank guarantees issued by banks on behalf of the Company and its subsidiary as disclosed in Note 25.4. 11. Investment in subsidiary As at 31 December 2014 and 2013, details of investment in a subsidiary as presented in separate are as follows: Shareholding Company s name Paid-up capital percentage Cost 2014 2013 2014 2013 2014 2013 (%) (%) Sun Express (Thailand) Company Limited 54,000 54,000 99.99 99.99 53,998 53,998 On 4 December 2013, a meeting of the Board of Directors of the Company approved an investment in Sun Express (Thailand) Company Limited, in line with the business plan and the group restructuring policy. Subsequently, on 24 December 2013, the Company acquired 53,998 ordinary shares with a par value of Baht 1,000 each, or a totaling of Baht 53,998,000from its former shareholders. During the year ended 31 December 2014, the Company received dividend income amounting to Baht 6,336,665 from its subsidiary (For the period as from 29 November 2013 to 31 December 2013: None). 12. Property, plant and equipment Consolidated Land Buildings and yard Furniture and fixtures Office equipment Computers Motor vehicles Assets under construction Total Cost: 29 November 2013-36,802 5,971 5,590 3,945 53,688 8,702 114,698 Additions - - - 60 37 482 2,059 2,638 Acquisitions of a subsidiary during the period - - 1,108 1,461 1,426 - - 3,995 31 December 2013-36,802 7,079 7,111 5,408 54,170 10,761 121,331 Additions 23,800 - - 572 1,648 27,597 3,171 56,788 Disposals - - - (592) (209) (1,456) - (2,257) Transfers in (out) - 13,352 - - - - (13,352) - 31 December 2014 23,800 50,154 7,079 7,091 6,847 80,311 580 175,862 15
Consolidated Land Buildings and yard Furniture and fixtures Office equipment Computers Motor vehicles Assets under construction Total Accumulated depreciation: 29 November 2013-12,821 5,433 4,277 2,465 14,225-39,221 Depreciation for the period - 166 35 56 45 647-949 Acquisitions of a subsidiary - - 1,094 1,269 1,264 - - 3,627 during the period - 12,987 6,562 5,602 3,774 14,872-43,797 31 December 2013-2,508 337 669 800 6,276-10,590 Depreciation for the year Depreciation on disposals - - - (570) (201) (1,456) - (2,227) 31 December 2014-15,495 6,899 5,701 4,373 19,692-52,160 Net book value: 31 December 2013-23,815 517 1,509 1,634 39,298 10,761 77,534 31 December 2014 23,800 34,659 180 1,390 2,474 60,619 580 123,702 Depreciation for the period/year For the period as from 29 November 2013 to 31 December 2013 (Baht 0.6 million included in cost of services, and the balance in selling and administrative expenses) 949 For the year ended 31 December 2014 (Baht 0.5 million included in cost of services, and the balance in selling and administrative expenses) 10,590 Separate Assets Buildings Furniture Office Motor under Land and yard and fixtures equipment Computers vehicles construction Total Cost: 29 November 2013-36,802 5,971 5,590 3,945 53,688 8,702 114,698 Additions - - - 60 37 482 2,059 2,638 31 December 2013-36,802 5,971 5,650 3,982 54,170 10,761 117,336 Additions 23,800 - - 325 1,561 27,079 3,171 55,936 Disposals - - - (1,192) (527) (1,456) - (3,175) Transfers in (out) - 13,352 - - - - (13,352) - 31 December 2014 23,800 50,154 5,971 4,783 5,016 79,793 580 170,097 Accumulated depreciation: 29 November 2013-12,821 5,433 4,277 2,465 14,225-39,221 Depreciation for the period - 166 35 55 43 647-946 31 December 2013-12,987 5,468 4,332 2,508 14,872-40,167 Depreciation for the year - 2,508 330 520 691 6,267-10,316 Depreciation on disposals - - - (906) (369) (1,456) - (2,731) 31 December 2014-15,495 5,798 3,946 2,830 19,683-47,752 16
Separate Assets Buildings Furniture Office Motor under Land and yard and fixtures equipment Computers vehicles construction Total Net book value: 31 December 2013-23,815 503 1,318 1,474 39,298 10,761 77,169 31 December 2014 23,800 34,659 173 837 2,186 60,110 580 122,345 Depreciation for the period / year For the period as from 29 November 2013 to 31 December 2013 946 (Baht 0.6 million included in cost of services, and the balance in selling and administrative expenses) For the year ended 31 December 2014 (Baht 0.5 million included in cost of services, and the balance in selling and administrative expenses) 10,316 As at 31 December 2014, the Company and its subsidiary hadmotor vehicles and equipment under finance leaseagreements with net book values amounting to Baht 59.4million (2013: Baht 32.2 million) (The Company only: Baht 59.0 million, 2013: Baht 32.3 million). As at 31 December 2014, certain equipment items have been fully depreciated but are still in use. The gross carrying amount before deducting accumulated depreciation of those assets amounted to approximately Baht 17.1million (2013: Baht 17.5 million)(the Company only: Baht 13.8 million; 2013: Baht 14.3 million). 13. Intangible assets The net book value of intangible assets as at 31 December 2014and 2013 is presented below. Consolidated Separate financial statements 2014 2013 2014 2013 Compute software - cost 374 374 191 350 Less: Accumulated amortisation (296) (265) (146) (255) Net book value 78 109 45 95 17
A reconciliation of the net book value of intangible assets is presented below. Consolidated Separate financial statements 2014 2013 2014 2013 Net book value at beginning of year/period 109 74 95 74 Additions - 23-23 Increase from acquisitions of a subsidiary - 14 - - Disposals - net book value at disposals date - - (28) - Amortisation (31) (2) (22) (2) Net book value at end of year/period 78 109 45 95 14. Trade and other payables Consolidated Separate 2014 2013 2014 2013 Trade accounts payable - related parties 1,150 3,127 101 18 Trade accounts payable - unrelated parties 31,595 31,603 24,480 21,390 Other payables - related parties - 5,450 764 5,427 Other payables - unrelated parties 4,855 7,484 2,824 4,557 Total trade and other payables 37,600 47,664 28,169 31,392 15. Liabilities under finance lease agreements Consolidated 2014 2013 Liabilities under finance lease agreements 25,040 20,842 Less: Deferred interest expenses (1,345) (1,671) Total 23,695 19,171 Less: Portion due within one year (11,446) (6,721) Liabilities under finance lease agreements - net of current portion 12,249 12,450 18
Separate 2014 2013 Liabilities under finance lease agreements 24,948 20,842 Less: Deferred interest expenses (1,345) (1,671) Total 23,603 19,171 Less: Portion due within one year (11,381) (6,721) Liabilities under finance lease agreements - net of current portion 12,222 12,450 The Company and its subsidiary have entered into the finance lease agreements with leasing companies for rental of motor vehicles and equipment for use in its operation, whereby it is committed to pay rental on a monthly basis. The terms of the agreements are generally between 1 and 4 years. Future minimum lease payments required under the finance lease agreements of the Company and its subsidiary were as follows: Consolidated As at 31 December 2014 Less than 1 year 1-4 years Total Future minimum lease payments 12,365 12,675 25,040 Deferred interest expenses (919) (426) (1,345) Present value of future minimum lease payments 11,446 12,249 23,695 Separate As at 31 December 2014 Less than 1 year 1-4 years Total Future minimum lease payments 12,300 12,648 24,948 Deferred interest expenses (919) (426) (1,345) Present value of future minimum lease payments 11,381 12,222 23,603 19