Ccet 09

Cal-Comp Technology (Suzhou) Co., Ltd.

1 FINANCIALHIGHLIGHTS 2 MESSAGEFROMTHEBOARDOFDIRECTORS 9 BOARDOFDIRECTORS13 GENERALINFORMATION14 SHAREHOLDINGSTRUCTURE ANDMANAGEMENT15 CAPITALSTRUCTURE18 THEGROUPSTRUCTUREOFTHECOMPANY20 NATUREOFBUSINESSOPERATION24 INDUSTRYANDMARKETCOMPETITION28 RISKFACTOR30 MANAGEMENTSTRUCTURE

37 CORPORATEGOVERNANCE43 RELATEDPARTYTRANSACTIONS54 AUDITCOMMITTEEREPORT55 INTERNALCONTROL56 DIRECTORS’REPORTING57 SOCIALANDENVIRONMENTRESPONSIBILITIES60 MANAGEMENTDISCUSSIONANDANALYSIS65 REPORTOFINDEPENDENTAUDITOR66 FINANCIALSTATEMENTS73 NOTESTOCONSOLIDATED FINANCIALSTATEMENTS

CONTENTS

0�Cal-Comp Electronics (Thailand) PlcAnnual Report 2009

Balance Sheet Summary 2009 2008 2007

Cash - and cash equivalents 2,666,021,791 2,083,185,133 1,724,502,786 Account Receivable 23,676,243,218 33,860,710,500 24,202,800,074 Inventories 8,232,260,966 9,674,791,789 8,159,430,746 Total current assets 37,518,713,523 50,200,257,375 37,048,712,189 Investment 65,575,869 69.899,911 48,649,716 Property plant and equipment (net) 7,797,280,862 8,184,145,751 6,792,431,620 Total assets 46,604,777,486 59,487,991,060 44,430,243,570 Loan from banks 8,803,879,174 14,232,224,143 7,522,341,917 Accounts payable 18,787,947,414 28,043,800,551 18,992,828,472 Total current liabilities 30,667,957,087 44,576,732,582 30,090,646,655 Long-term loan - - 403,733,593 Total liabilities 30,667,957,087 44,576,732,582 30,494,380,248 Registered capital 4,786,168,001 4,786,168,001 4,786,168,001 Paid-up capital 3,941,108,792 3,930,923,139 3,919,208,416 Retained earnings 9,038,918,688 7,934,657,389 7,374,702,903 Total shareholders’ equity 15,936,820,399 14,911,258,478 13,935,863,322 Number of shares Outstanding Dec 31 3,941,108,792 3,930,923,139 3,919,208,416

Profit & Loss Statement Summary 2009 2008 2007

Sales 108,437,914,397 123,285,411,620 93,824,677,213 Total revenue 108,620,421,723 123,759,313,512 94,156,942,546 Cost of sales 104,446,547,048 118,952,536,903 89,150,610,318 Selling and administrative expenses 2,083,359,829 1,614,507,852 1,416,666,685 Total expense 106,795,350,385 120,907,957,126 90,713,480,084 Net profit 1,301,308,839 2,127,779,400 2,900,595,826

Key Financial Ratios 2009 2008 2007

Liquidity Ratios Current Ratio 1.22 1.13 1.23 Quick ratio 0.95 0.91 0.96 Collection period (days) 96 85 79 Inventory turnover (days) 31 27 32 Payment period (days) 81 71 68 Cash Cycle (days) 46 41 44 Profitability Ratios Gross profit margin (%) 3.68 3.51 4.98 Operating profit margin (%) 1.76 2.20 3.47 Net profit margin (%) 1.20 1.72 3.08 Return on equity (%) 8.44 14.75 21.87 Efficiency Ratios Return on total assets (%) 2.45 4.10 7.44 Return on fixed assets (%) 43.35 38.44 59.37 Total assets turnover (times) 2.04 2.37 1.53 Leverage Ratios Total liabilities / Total equity 1.92 2.99 2.19 Interest coverage (EBIT/Interest expenses) 11.00 6.70 7.91 Information on Shares (Baht) Book value per share 4.04 3.79 3.56 Earnings per share 0.33 0.54 0.74 Dividend per share 0.11 0.20 0.40

FINANCIAL HIGHLIGHTS

02 Cal-Comp Electronics (Thailand) PlcAnnual Report 2009

Mr. Hsu, Sheng-Hsiung Chairman

2009 was another challenging year for every business in light of uncertainty bounded by the deteriorating global economic situation. Surrounded by the numerous bankruptcy and incredibly high unemployment rate, all were cautiously striving for better business outlook yet anxiously wondering whether the worst has already behind us. According to the IMF, the global economic growth rate was -1.1% in 2009. Compared to 3.0% in 2008 and 5.2% in 2007, it was no doubt a dreadful year for business environment worldwide. Against the backdrop of this volatile global market, we have worked hard to ensure CCET continues to operate from a foundation of strength. Sales revenue in 2009 was at USD 3.16 billion, or 14% lower YoY, which indicates the bad shape of global economic as well the Company’s strong capability to adapt in the face of a difficult operating environment. Several challenges that emerged in 2009 including intensified market competition, higher cost of raw materials during the first half of year due to worldwide material shortages and the appreciation of the Thai Baht against the US Dollar. These factors inevitably affected the Company’s profitability. Therefore, the net profit of year 2009 reported at Baht 1,301 million, a decrease of 38.84% compared with year 2008. Although 2010 has embarked with better sentiment and signs of short-term economic recovery, the business environment is likely to remain strenuous considering that the unemployment rate is still high and the Government’s stimulus program has yet to take effect.

MESSAGE FROMTHE BOARD OF DIRECTORS

0�Cal-Comp Electronics (Thailand) PlcAnnual Report 2009

Mr. Shen, Shyh-Yong Vice Chairman

Overlook 2010, CCET will expand its operation base beyond Thailand and China to leverage low cost product facilities and support the customer’s need. In addition, new product lines are in mass production in 2010 including LED, Smart phone and Laser printers which deemed as the growth engine accelerating CCET into next milestone. Moreover, the Company will also look for opportunities on vertical integration particularly on the component sector. By integrating with valued supply chain, we will be able to provide better value added services to the customers and further strengthening our cost competitiveness among the competitors. Together, we believe that should enable CCET to withstand its market position and to prepare well for the forthcoming global turnaround. As the Company celebrated its 20th anniversary in year 2009, to ensure the success for next 20 years is now a major task for the Company. We would like to thank the management team and all of the staffs for their hard work and unrelenting spirits. On behalf of the Board, we would also like to take this opportunity to extend our sincerest gratitude to our valued customers, suppliers, partners, banks, government authorities and shareholders for their continued support and trust. We are honored to work for you as the Board of CCET and we remain optimistic for the Company’s ongoing success in 2010.

Celebration of Cal-Comp 20th Anniversary

CAL-COMP ELECTRONICS (THAILAND ) PLC.


FACTORY & EQUIPMENT

PRODUCT DIVERSITY


Cal-Comp Electronics (Thailand) PlcAnnual Report 2009

BOARD OF DIRECTORS

09

Mr. Hsu, Sheng-Hsiung

Position Chairman Education Bachelor of Chinese, National Taiwan Normal University, Taiwan Work Experience 1989-Present The Chairman of the Board Cal-Comp Electronics (Thailand) Plc. 1992-Present The Chairman of the Board Kinpo Electronics, Inc. 1994-Present The Chairman of the Board Compal Electronics Inc. 2002-Present The Chairman of the Board Cal-Comp Electronics (Suzhou) Co., Ltd. 2003-Present Director Cal-Comp Electronics Optical (Suzhou) Co., Ltd. 2004-Present The Chairman of the Board Cal-Comp Electronics and Communication Co., Ltd. 2008-Present Director Cal-Comp Technology (Suzhou) Co., Ltd. 2008-Present Director Cal-Comp Electronics and Communication (Suzhou) Co., Ltd.

Securities holding (As of December 31, 2009)

Name Type of securities Amount

Mr. Hsu, Sheng-Hsiung Common share 9,310,000 Warrant (CCET-W2) 2,000,000 TDR -

Spouse Common share 11,200,000 Mrs. Hsu, Tsai Li-Chu Warrant (CCET-W2) 1,200,000 TDR -

Minor child Common share - Warrant (CCET-W2) - TDR -

IOD Program

£ Not attend the course from Thai Institution of directors yet.

Mr. Shen, Shyh-Yong

Position Vice Chairman Education Doctor of Law, Whittier Law School, USA Master of Business Administration, Southern California University, USA Bachelor of Public Administration, National Chengchi University, Taiwan Work Experience 2003-2004 Department Director of Procurement Division AcBel Polytech Inc. 2004-2005 Vice President of central procurement Kinpo Electronics Inc. 2004-2008 Assistant Vice President Cal-Comp Electronics (Thailand) Plc. 2008-Present CEO Kinpo Electronics Inc. August 2008-Present Vice Chairman of the Board Cal-Comp Electronics (Thailand) Plc. August 2008-Present Director Cal-Comp Electronics (Suzhou) Co., Ltd. August 2008-Present Director and Managing Director Cal-Comp Electronics and Communication Co., Ltd. August 2008-Present Chairman of the Board Cal-Comp Optical Electronics (Suzhou) Co., Ltd. August 2008-Present Chairman of the Board Cal-Comp Technology (Suzhou) Co., Ltd. August 2008-Present Chairman of the Board Cal-Comp Electronics and Communication (Suzhou) Co., Ltd.



Mr. Shen, Shyh-Yong Common share 3,385,000 Warrant (CCET-W2) 3,000,000 TDR -

Spouse Common share 1,269,300 Mrs. Hsu, Yung-Hsu Warrant (CCET-W2) - TDR -

Minor child Common share - Shen, Hsin-Yu Warrant (CCET-W2) - TDR 30,000

Minor child Common share - Shen, Pei-Chi Warrant (CCET-W2) - TDR 30,000

IOD Program



Mr. Ko, Charng-Chyi

Position Director Education Doctor of Business Administration, Lincoln University, USA Master of Business Administration, National Chengchi University, Taiwan Bachelor of Business Administration, National Taiwan University, Taiwan Work Experience 1989-Present Director Cal-Comp Electronics (Thailand) Plc. 1995-Present Director Kinpo Electronics, Inc. 1995-Present Director Compal Electronics, Inc.



Mr. Ko, Charng-Chyi Common share 5,780,000 Warrant (CCET-W2) - TDR -

Spouse Common share - Warrant (CCET-W2) - TDR -


IOD Program


Mr. Hsu, Sheng-Chieh

Position Director Education Bachelor of Engineering, Tamkang University, Taiwan Work Experience 1989-Present Director / Cal-Comp Electronics (Thailand) Plc. 1994-Present Director / Kinpo Electronics, Inc. 1994-Present Director / Compal Electronics, Inc. 2002-Present Director / Cal-Comp Electronics (Suzhou) Co., Ltd. 2004-Present Director Cal-Comp Electronics and Communication Co., Ltd.



Mr. Hsu, Sheng-Chieh Common share 5,560,000 Warrant (CCET-W2) - TDR -



IOD Program £ Not attend the course from Thai Institution of directors yet.

Mr. Chou, Kung-Hsiung

Position Managing Director Education Master of Business Administration, Pacific Western University, Thailand Bachelor of Engineering, Feng Chia University, Taiwan Work Experience 2006-Present Managing Director Cal-Comp Electronics (Thailand) Plc. 1984-Present Vice Managing Director Cal-Comp Electronics (Thailand) Plc. August 2009-Present Director and Managing Director Cal-Comp Optical Electronics (Suzhou) Co., Ltd. August 2009-Present Director and Managing Director Cal-Comp Electronics (Suzhou) Co., Ltd. August 2009-Present Director and Managing Director Cal-Comp Electronics and Communications (Suzhou) Co., Ltd. August 2009-Present Director and Managing Director Cal-Comp Technology (Suzhou) Co., Ltd.



Mr. Chou, Kung-Hsiung Common share 1,400,000 Warrant (CCET-W2) - TDR -



IOD Program £ Attended the Director Certification Program (DCP), class 47/2004

11Cal-Comp Electronics (Thailand) PlcAnnual Report 2009

Mr. Thanasak Chanyapoon

Position Director Education Master degree in laws (LL.M. (commercial laws)), University of Cambridge, UK Master degree in laws (LL.M.), Chulalongkorn University, Thailand Certificate on American and International Laws, Dallas, USA Bachelor degree in laws (LL.B.(Honors)), Chulalongkorn University, Thailand Work Experience 2001-May 2003 Managing Associate Linklaters (Thailand) Co., Ltd, Bangkok May 2003-2004 Senior Associate Law Alliance Limited 2004-October 2006 Director Law Alliance Limited November 2006-Present Managing Director, Law Alliance Limited 2008-Present Director, Khao Soon Tungsten Mining Company Limited March 2008-Present Director, Cal-Comp Electronics (Thailand) Plc. January 2010-Present Independent Director / Audit Committee United Asset Management Company Limited



Mr. Thanasak Chanyapoon Common share - Warrant (CCET-W2) - TDR -



IOD Program

£ Attended DAP Program of IOD, Class 73/2008.

Mr. Alan Kam

Position Chairman of Audit Committee and Independent Director Education Master of Business Administration, University of Denver, USA Bachelor of Business Administration, University of Denver, USA Work Experience 2000-Present Chairman of Audit Committee/Independent Director Cal-Comp Electronics (Thailand) Plc. 2009-Present Independent Director Golden Land Property Development Plc.



Mr. Alan Kam Common share - Warrant (CCET-W2) - TDR -



IOD Program

£ Director Certification Program DCP 39/2004

£ Fellow Member & Chartered Director

£ Attended the IOD-Corporate Social Responsibility Seminar in 12/ 2007

£ Attended the Chartered Director Class (CDC) on 10/2008


Mr. Vichai Jittawait

Position Audit Committee and Independent Director Education Master of Science in Civil Engineering (M.S.C.E), West Virginia University, USA Bachelor of Civil Engineering (B.Engr.), Khonkaen University, Thailand Work Experience 2005-Present Audit Committee Member/Independent Director Cal-Comp Electronics (Thailand) Plc. 1990-Present Chairman Builder Consultants Co., Ltd.



Mr. Vichai Jittawait Common share - Warrant (CCET-W2) - TDR -



IOD Program

£ Attended the Director Accreditation Program (DAP), class 37/2005

£ Attended the Director Certification Program (DCP), class 74/2006

Mr. William Hang Man Chao

Position Audit Committee and Independent Director Education Master of Business Administration Major in Finance and Marketing, University of Chicago, USA Bachelor of Science; Major in Finance, Indiana University, USA Work Experience 2000-Present Audit Committee/Independent Director Cal-Comp Electronics (Thailand) Plc. 1998-Present Managing Director Wing Wah Advisory (Thailand) Limited 1998-2007 Independent Director Seamico Securities Plc. 1999-Present Director Bangkok Garden Property Fund 2000-Present Director City Realty Co., Ltd. 2009-Present Director Libertas Co., Ltd



Mr. William Common share 9,305,700 Warrant (CCET-W2) 379,900 TDR -



IOD Program

£ Attended DAP Program of IOD, Class 74/2008.

£ Attended Director Certification Program (DCP), class 112/2009


GENERAL INFORMATION

General information of the company

Industry/Sector Technology / Electronic Components

Company Cal-Comp Electronics (Thailand) Public Company Limited

Business Produce electronics products in form of Electronics Manufacturing Services (EMS).

EMS products mostly are designed and distributed by the owners of the brand. At present,

the Company produces computer peripheral and telecommunication products.

Security Code £SET Ticker: CCET TB

£TSE Ticker: 9105 TT

Head office 191/54, 191/57 18th Fl., CTI Tower, Rachadapisek Road, Klongtoey, Bangkok 10110

Telephone 02-261-5033-37, 02-661-9381-83

Fax 02-661-9396

Home page http://www.calcomp.co.th

Registered number 0107543000023

Authorized Capital 4,786,168,001 Baht

Paid-up Capital 3,941,108,792 Baht

Par value 1 Baht

Dividend Policy Not less than 30% of its Company only net profit of each fiscal year after legal reserve.

Factories in Thailand (1). Factory 1-3

60 Moo 8, Sethakij Road, Tambol Klong Maduea, Ampur Kratoom Bean,

Samuthsakorn, 74110, Thailand

(2). Factory 4-6

138 Moo 4, Petchkasem, Tambol Sapang, Ampur Koaw-Yoi, Petchaburi, 76140, Thailand

(3). Branch at Nakhonratsima Province

44/4 Moo 9, Tumbol Sungnoen, Amphur Sungnoen, Nakhonratsima 30170, Thailand

(4). Branch at Petchaburi province

91 Moo 4, Tambol Sapang, Ampur Koaw-Yoi, Petchaburi, 76140, Thailand

Factories in China (1). Cal-Comp Electronics (Suzhou) Company Limited, Cal-Comp Optical Electronics (Suzhou)

Company Limited.

No. 2288, Jiangxing East Road, Wujiang Economic Development Zone, Jiangsu, P.R. China

(2). Cal-Comp Technology (Suzhou) Co., Ltd.Genway Factory,No 288, Shengpu Road,

Export Processing Zone B, Suzhou Industrial Park, Jiangsu Province, China.

(3). Cal-Comp Electronics and Communication (Suzhou) Co., Ltd.

Wujiang Export Processing Zone, No. 688, Pangjin Road, Wujiang Economic Development

Zone, Jiangsu Province, China.

Subsidiary in Taiwan No.147, Sec 3, Beishen Rd. Shen Keng, Taipei (222) Taiwan, R.O.C


SHAREHOLDING STRUCTURE AND MANAGEMENT

1. Kinpo Electronics, Inc Manufacture of 1,555,163,770 39.46

electronic products

2. Far Eastern International Bank Depositary of TDR 773,034,653 19.61

3. Chase Nominees Limited 42 - 270,057,600 6.85

4. Compal Electronics, Inc Manufacture of notebook 254,240,000 6.45

5. Kingbolt International (Singapore) Pte., Ltd. - 241,930,000 6.14

6. Raffles Nominees (Pte) Limited - 85,033,700 2.16

7. Thai NVDR Company Limited - 74,515,585 1.89

8. Mr. Jessada Lertnantapanya - 56,675,600 1.44

9. Mr. Chern Kuan-Jan - 34,179,800 0.87

10. American International Assurance

Company Limited-Tiger - 20,000,000 0.51

Total 3,364,830,708 85.38

Notes : Kinpo Electronics, Inc. and its 100% owned subsidiary, Kingbolt International (Singapore) Pte Ltd., hold totally 1,797,093,770 shares or 45.60%.

List of top 10 shareholders

No. of shares as at % of paid Group of shareholders Nature of business December 31, 2009 up capital


Securities of the Company

1. Ordinary shares The registered and paid-up capital as at December 31, 2009: The registered capital : Baht 4,786,168,001, comprising 4,786,168,001 ordinary shares with the par value per share of Baht 1. The paid-up capital : Baht 3,941,108,792, comprising 3,941,108,792 ordinary shares with the par value per share of Baht 1.

2. Warrant £ CCET-W1 The Company allotted the 725,931,801 units of 3 years warrants for the rights to buy ordinary shares to the existing shareholders. The warrants can be exercised on the 10th of March, June, September, and December every year throughout the Term of the Warrants . The warrants listed in the Stock Exchange of Thailand since April 25, 2006 with the code of CCET-W1 and was delisted on April 20, 2009. During year 2009, the warrantholders exercised the rights to purchase the ordinary share of 9,072,971 units equal to 9,380,453 ordinary shares. The warrants was expired on April 18, 2009 and there are remaining 676,610,203 units of CCET-W1 expired. The reserved common shares of 700,781,709 shares will be cancelled on Annual General Meeting of Shareholders in 2010. £ CCET-W2 The Company issued the Employee Stock Option Plan (ESOP) by allotting the 156,000,000 units of 3 years warrants for the rights to buy ordinary shares to the selected employees of the Company and/or its subsidiaries. The warrants have been listed in the Stock Exchange of Thailand since October 11, 2007 with the code of CCET-W2. The warrants can be exercised on the 10th of March, June, September and December every year throughout the Term of the Warrants for 3 years. As of December 31, 2009, the Warrantholders (CCET-W2) exercised the warrants of 11,722,500 units and purchase the ordinary share of 11,722,500 shares. Therefore, the balance of warrants as of December 31, 2009 is 144,277,500 units.

3. Taiwan Depository Receipts (TDRs) There are 773,034,653 units of Taiwan Depository Receipts (TDRs) underlying 773,034,653 ordinary shares or 19.61% of total paid up capital. The TDRs have been listed in Stock Exchange of R.O.C with the code of 9105.TT. Depositary of TDRs for the underlying shares is Far Eastern International Bank. The redemption rate is 1 TDR for 1 ordinary share. The right to redeem can be used every day without expiry. TDRs are entitled the same rights as ordinary shares such as the rights to attend the meeting, rights to vote, rights to receive the dividend and right to subscribe the RO, etc.

4. NVDR As at December 31, 2009, there are 74,515,585 units of NVDRs of the Company, equivalent to 1.89% of the paid-up capital, underlying the same shares of ordinary share. The NVDR holders are entitled to the same rights of the underlying shares, but do not have the right to vote in the shareholders’ meeting except in case of delisting. The ordinary shares will be used as the underlying for issuance of NVDRs. Consequently, the number of voting shares will decrease. Even the number of NVDRs is quite small; there may be some changes that the Company is not able to control.

CAPITAL STRUCTURE


Investments 1. Cal-Comp Electronics (Suzhou) Company Limited Cal-Comp Electronics (Suzhou) Company Limited has a paid-up capital of US$ 27.18 million, operating as a manufacturer of electronics products. The products cover telecommunication sector and its operation runs in China. This subsidiary is 100% owned by the Company. The registered address is no.2288, Jiangxing East Road, Wujiang Economic Development Zone, Jiangsu, P.R China.

2. Cal-Comp Optical Electronics (Suzhou) Company Limited Cal-Comp Optical Electronics (Suzhou) Company Limited has a paid-up capital of US$ 41.30 million, operating as a manufacturer of electronics. The products cover computers sector and its operation runs in China. This subsidiary is 100% owned by the Company. The registered address is no.2288, Jiangxing East Road, Wujiang Economic Development Zone, Jiangsu, P.R China.

3. Cal-Comp Electronics and Communication (Suzhou) Co., Ltd. Cal-Comp Electronics and Communication (Suzhou) Co., Ltd. has paid-up capital of US$ 19 million, operating as a manufacturer of electronics products. The products cover computer peripheral and telecommunication sector and its operation runs in China. This subsidiary is 100% owned by the Company. The registered address is Wujiang Export Processing Zone, No. 688, Pangjin Road, Wujiang Economic Development Zone, Jiangsu Province, China.

4. Cal-Comp Technology (Suzhou) Co., Ltd. Cal-Comp Technology (Suzhou) Co., Ltd. has paid-up capital of US$ 10 million, operating as a manufacturer of electronics products. The products cover computer peripheral sector and its operation runs in China. This subsidiary is 100% owned by the Company. The registered address is Genway Factory,No 288, Shengpu Road, Export Processing Zone B, Suzhou Industrial Park, Jiangsu Province, China.

5. Cal-Comp Electronics and Communications Co., Ltd. Cal-Comp Electronics and Communications Co., Ltd. has a paid-up capital of NT$ 69,920,780, operating as a distributor for electronics products. This subsidiary is owned 100% by the Company. The registered address is No.147, Sec.3, Beishen Road, Shenkeng Township, Taipei County 222, Taiwan, R.O.C.

6. Logistar International Holding Company Limited Logistar International Holding Company Limited has a paid-up capital of US$ 30,050,000, operating as a holding company to support investment in foreign countries and to make out of the full potential for business operation and also to be a distributor of the products. Logistar International Holding Company Limited operates in British Virgin Islands and is owned 100% by the Company. The registered address is situated at Palm Grove House, P.O. Box 438, Road Town, Tortola, British Virgin Islands.

7. Wise Sigma International Holding Company Limited Wise Sigma International Holding Company Limited has a paid-up capital of US$ 5 million, operating as a holding company and running the business in British Virgin Islands. The Company owns 45.55% of Wise Sigma International Holding Company Limited indirectly through Logistar International Holding Company Limited. The registered address is situated at Beaufort House, P.O. Box 438, Road Town, Tortola, British Virgin Islands.

8. A-Ten Technology Co., Ltd. A-Ten Technology Co., Ltd. has paid up capital of NT$30,000,000. The main business activities are a research house and distribution for telecommunication products such as mobile phones, pagers. The Company owns 34.33% of A-Ten Technology Co., Ltd. indirectly through Logistar International Holding Company Limited. The registered address is situated at 4F., No.442, Sec. 2, Jhongshan Rd., Jhonghe City, Taipei County 235, Taiwan (R.O.C.)


9. Telian Corporation (Korea) Telian Corporation (Korea) has a paid-up capital of 3,346,080,000 Korea Won, operating as a research house and distributor of telecommunication products such as mobile phones, cordless phone. The Company owns 23.87% of its paid-up capital. The registered address is situated at 4th Fl., Namjeun Bldg., 53-3 Haan-Dong, Kwangmyung-Si, Kyunggi-Do, 423-060, Korea.

10. Doctor Mobile Incorporated Doctor Mobile Incorporated has a paid up capital of USD 3,000,000 operating as a mobile phone and research and development for telecom related device. The Company owns 10.00% of Doctor Mobile Incorporated indirectly through Logistar International Holding Company Limited. The registered address is situated at P.O. Box 4389 Road Town, Tortola British Virgin Islands.

11. Kinpo Group Management Service Co., Ltd. Kinpo Group Management Service Co., Ltd. has a paid-up capital of NT$ 8 million, operating as a consultant company. The Company owns 12.5% of paid up capital indirectly through Cal-Comp Electronics and Communication Co., Ltd. and the registered address is situated at 10F., No.99. Sec.5, Nanjing E. Rd., Songshan District, Taipei City 105 Taiwan (R.O.C.)

12. Inx Japan International, Inc. Inx Japan International, Inc. has a paid-up capital of ¥¥ 90,000,001, operating as a distributor of computers products and management of copyrights for products designed under the name “Inx Japan”. The Company owned 11.11% and the registered address is situated at 2 Fl., Akasaka Long Beach Bldg., Akasaka 3-21-20, Minato-Ku, Tokyo, Japan.

13. BC2L Ltd. BC2L Ltd. has a paid-up capital of US$ 329,782 and produces and develops Bluetooth technology. BC2L Ltd. is owned indirectly by the Company through Logistar International Holding Company Limited for 6.36% of its paid-up capital. The registered address is situated at 2 Ang Mo Kio Street 64#03-00 Econ Industrial Building Singapore 569084.

14. Power Digital Communication Co., Ltd. Power Digital Communication Co., Ltd. has a paid-up capital of NT$ 395,000,000, distributing various telecommunication products. The Company owns Power Digital Communication Co., Ltd. for 1.90% of its paid-up capital. The registered address is situated at (231) 2F, No.10 Alley 6, Lane 45, Pao-Hsing Rd., Hsintien City, Taipei County Taiwan R.O.C.

15. Zakang, Inc. Zakang, Inc. has a paid-up capital of 42,189,534,500 Korea Won. It does research and distribute telecommunication products such as pagers and mobile phones. The Company owns 0.37% of paid up capital. The registered address is situated at C-402, Pundang Techno Park, 151, Yatap-Dong, Pundang-Ku, Sungnam-Si, Kyunggi-Do, Korea.



12.5 %

Kinpo Group Management

Service Co., Ltd.

6.36 %

BC2LLtd.

100 %

Cal-CompTechnology

(Suzhou) Co., Ltd.

100 %

LogistarInternational

HoldingCo., Ltd.

23.87 %

Telian Corporation

(Korea)

1.9 %

PowerDigital

CommunicationCo., Ltd.

100 %

Cal-CompOptical

Electronics(Suzhou) Co., Ltd.

100 %

Cal-CompElectronics and Communications

(Suzhou)Co., Ltd.

100 %

Cal-CompElectronics

and Communications

Co., Ltd.

11.11 %

InxJapan

International,Inc.

100 %

Cal-Comp Electronics

(Suzhou) Co., Ltd.

0.37 %

Zakang,Inc.

(Korea)

45.55 %

Wise SigmaInternational

HoldingCo., Ltd.

34.33 %

A-TenTechnology

Co., Ltd.

10.00 %

DoctorMobile

Incorporated

THE GROUP STRUCTURE OF THE COMPANY AS OF 31 DECEMBER 2009


Investment policy and benefits derived from investment in any associated company and other companies. In an attempt to make investments in any subsidiary company, associated company and other companies, the Company will particularly take into account the possibility of generating proceeds and benefits to be obtained by the Company. The company has established manufacturing facilities in China since 2003. Leveraging the low cost production can keep the Company competitive and be able to address customer’s need. As a result, the Company has expanded its customer base and operation scale to a world class EMS.

Other reference parties

Shares and Warrants Registrar : Thailand Securities Depository Co., Ltd. 62 The Stock Exchange of Thailand Building Rachadapisek Road, Klongtoey, Bangkok 10110 Tel : (662) 229-2800 Fax : (662) 359-1259 : Thailand Securities Depository Co., Ltd. Capital Market Academy Building, The Stock Exchange of Thailand 2/7 Moo4, (North Park Project) Vibhavadi-Rangsit Rd., Km.27 Tung Song Hong, Bangkok 10210

Taiwan Depository Receipts : Far Eastern International Bank (TDRs) Depositary 5 F, No. 1, Hsiang Yang Rd., Taipei, Taiwan, R.O.C. Tel : 886-2-2312-3636 Fax : 886-2-2388-8278

Auditor : Ms. Rungnapa Lertsuwankul Certified Public Accountant (Thailand) No. 3516 Ernst & Young Office Limited 193/136-137, Lake Rajada Office Complex, Rachadapisek Road, Klongtoey, Bangkok 10110 Tel : (662) 264-0777 Fax : (662) 264-0789-90


NATURE OF BUSINESS OPERATION

Cal-Comp Electronics (Thailand) Public Company Limited (“The Company”) was found with initial capital of Baht 125 million on 4 December 1989 in order to embark on electronics manufacturing services (EMS) business. At present, the Company has registered capital of Baht 4,786,168,001 and paid-up capital of Baht 3,941,108,792. The Company is in Electronics Manufacturing Services (EMS) business, producing electronics products for major brands worldwide for example, Western Digital, Seagate, Advance Digital Broadcast, Thomson, Hewlett Packard, Panasonic, Motorola, and Nikon. The Company’s OEM products can be categorized into 2 groups as follows: £Computer peripherals such as ink-jet printers, multi-function printers, dot-matrix printers, external hard disk drive and PCBA. £Telecommunication products such as Set Top Box, mobile phones and Bluetooth headsets. As of 31 December 2009, the Company has 11 factories, 6 located in Thailand, employing 6,065 employees and 5 located in China, employing 7,045 employees. Manufacturing factories are located in 3 areas as followings: £The first location in Thailand has 3 factories in the same area at Ampur Kratumban, Samuthsakorm £The second location in Thailand has 3 factories in the same area at Ampur Khaoyoi, Petchaburi £The location in China has 5 factories in Suzhou, Jiangsu Province. The Company was awarded investment tax privileges type 5.4, 5.5, 5.6 and 5.7 for manufacturing electronics products and electronics components from Board of Investment (BOI) in which provided 8 tax incentive projects.

Income Structure

Computer Peripheral 73,964 78.55 98,172 79.33 86,426 79.57

Telecommunication Products 18,320 19.46 24,880 20.10 22,012 20.26

Other Equipment 1,541 1.64 233 0.19 - -

Total sales revenue 93,825 99.65 123,285 99.62 108,438 99.83

Other revenue 332 0.35 474 0.38 182 0.17

Total revenue 94,157 100.00 123,759 100.00 108,620 100.00

2007 2008 2009

Million Million Million Divisions Baht % Baht % Baht %


The production in Thailand and in China utilizes labor for 1 round per day (8 hours per round). The factories in Thailand utilize 81% of the full capacity and the factories in China utilize 77% of the full capacity. Overall, the Company utilizes 79%, 80% and 79% of the full capacity for year 2007, 2008 and 2009, respectively. In order to improve the Company’s manufacturing efficiency while maintain its existing competitiveness, the Company developed a series of system to monitor the operation routine on daily basis. Four systems including production direct control system, manufacture on time systems, B2B procurement system, and digital center server system has formed a fine network to provide the Company and its customers most updated information in order to track and analyze potential issues.

Details of purchasing of local and foreign raw materials during 2007-2009 The Company has purchased raw materials through local and overseas suppliers. Bellow is the Company’s consolidated purchase amount in million baht during 2007-2009.

Domestic raw materials 22,879.17 28.35 32,396.13 29.86 27,812.68 28.02 Imported raw materials 57,820.08 71.65 76,112.42 70.14 71,457.48 71.98

Total 80,699.25 100.00 108,508.55 100.00 99,270.16 100.00

2007 2008 2009

Million Million Million Order Baht % Baht % Baht %

Production Volume (Unit : Thousand Units)

Production volume

- Computer Peripheral 87,256 82.30 149,905 88.81 161,141 94.56 - Telecommunication Accessories 16,674 15.73 18,792 11.13 9,275 5.44 - Other Equipment 2,089 1.97 105 0.06 -

Total 106,019 100.00 168,802 100.00 170,416 100.00

2007 2008 2009

Description Number % Number % Number %


Raw material Description Source of supply

Radio Components Antenna, Balun and Bandpass filter, Transceiver, Taiwan, Korea and China Tuner, Power amplifier , Resonator, Crystal.

Chip IC series MCP, DSP, Audio amplifier, Memory, LCM driver, Singapore, Japan, Korea and Power management, Media IC. the U.S.

Key Component CPU, HD, Pens, LCM, Printer heads, Modulator Thailand, Taiwan, China, Singapore and Japan

Other Components Capacitor, Bead inductor, Vibration Motor, Thailand, Taiwan, China, Singapore, Speaker, Receiver, Microphone, Metal Dome, Japan, and U.S. Switch, Connector, FPC, LED, Discrete, PCB, Res

Types and sources of essential raw materials Raw materials for internal components

Raw material Description Source of supply

Adapter and Cables Electric cable and adaptors Thailand, Malaysia, China

Case Plastics and plastic components Thailand, Singapore, Malaysia and China

Packaging Paper box, Poly foam, Plastic bags, Thailand and China Plastic tapes and Tag.

Raw materials for external components Raw materials for external components are primarily the case of the products and other outside components as follows:

Raw material suppliers Raw material suppliers can be categorized into 3 groups as follows:

(1) Procure through parent company

(2) Procure through affiliates

(3) Directly procure from other suppliers.


Purchasing Policy The Company’s purchasing policy is based upon the comparison of prices of raw materials quoted by each supplier, and punctual delivery of the supplier to each shipment and taking into account the maximum benefits to be obtained by the Company. In the purchasing process, the sales department and the production department will cooperate in planning the purchase of raw materials so as to ascertain the demands for each period and maintain the inventory at an appropriate level from time to time.

Material changes in 2009 £The Board of director had approved the investment increase of Logistar International Holding Co., Ltd. which is

100% wholly owned by the Company of USD 20,000,000. After capital increased, the paid up capital is USD 30,050,000. The purpose for the capital increase is for the improvement the financial structure of LGT.

£Withdrawal the investment in India, which was approved by the Board of Directors’ meeting no. 3/2007 on August 13, 2007. Since the company’s production capacity is sufficient to support the current demand, the Board of Director approved to withdraw this investment project.

£The Board of director had approved the investment increase of Cal-Comp Electronics & Communication (Suzhou) Co., Ltd., a 100% owned subsidiary of USD 20,000,000. After capital increased, the paid up capital is USD 35,000,000 and expect to be completed by August 2011. The purpose of investment is for supporting the working capital. As of December 31, 2009, the Company started to invest of USD 4,000,000.

£Launch Syndication loans of USD 120,000,000 for the Company and its subsidiary, Logistar International Holding Co., Ltd. which is 100% wholly owned by the Company from finance institutions which are non-related with the Company and its subsidiary LGT. The available period is 3 years plus 2 years extend option and the purpose is to improve the financial structure and increase working capital facility to support business operation.

Suppliers Raw material

1. Allied Technologies (Thailand) Co., Ltd. Steel components, die steel 2. Jeng Jea (Thailand) Co., Ltd. Spray Painting 3. Ever Jet Co., Ltd. Plastic components 4. Jet Industries (Thailand) Co., Ltd. Plastic components 5. Hypertek Plastic Industry Co., Ltd. Plastic 6. Chang Huat Plastic Industries (Rayong) Co., Ltd. Plastic

Key components will be procured according to customer’s specification. The major shareholders and affiliates may be also CCET’s customers as well. The Company implements random sampling to investigate each raw material types and uses Vendor Quality Assurance system to certify the qualified suppliers. The Company will only place order to the qualified suppliers. Moreover, there are 6 raw material suppliers established their manufacturing facilities inside the Company’s productions zone which is called Value-Chain Partnership. This partnership allows CCET to control raw materials quality in real time and to reduce inventory spaces and to lower transportation costs. Those six suppliers do not hold shares of the Company, nor do them related to management of the Company. The aforementioned suppliers are as follows:


INDUSTRY AND MARKET COMPETITION

EMS Industry Overview The global recession does have great impact on every industry in 2009. During the time, companies facing shortage in raw material supply, higher cost of good sold due to oil price, lower market demand and else. However, although the economic situation is still not yet fully recover, more than 50% of companies see the macro environment improving yet still worried about the level of business activity and/or volume for the forthcoming years. Senior research analyst in the electronics manufacturing services and consumer device semiconductors, Michael Palma, reporting that the recession drove down industry’s sales revenue by $37 billion in 2009, a 12.9% contraction as comparing to 2008. Result shows that 2009 was considered a bad year for all since consumer spending was evaporated and capital spending was contracted as well. Such situation shall be improved since the economy starts to recover and the EMS industry revenues should therefore show a slight improvement from 2010. Exhibit 1 : Worldwide EMS/ODM industry revenue 2005 to 2013

250

200

150

100

50

02005

EMS Sector

ODM Sector

300

350

2006 2007 2008 2009 2010 2011 2012 2013

(SB)

EMS/ODM Trend The key driver for the electronics contract manufacturing industry (EMS & ODM) is cost. High-volume manufacturing in the form of EMS/ODM can be attracted to countries by offering low-cost labor and availability of components (e.g., price and suppliers ecosystem). The critical success factors for an EMS/ODM model is be able to offer real outsourcing cost reductions and benefits that actually help OEMs to reduce costs, including: £Low cost geographic destinations £Component costs £Intellectual property (IP) protection £Government tax incentives £Adequate infrastructure £Developed transportation and logistics On the other hand, short lead time can be challenging and has significantly impact on EMS/ODM companies. To make matters worse, in difficult economic environments, customers can change EMS delivery schedules and forecasts; even significantly reduce their forecast period.


The computer sector is expecting to show strong growth at a CAGR of 9.5% over the next five years. Meanwhile, the consumer and communication industries are also expecting a CAGRs of 7.9% and 7.0% respectively through 2013. Overall, the global EMS market is expecting to grow 8.1% annual from a $294 billion market in 2008 to $435 billion market in 2013. However, it is also important to note that although the industry is still showing growth, the forecasts are much less aggressive than previous years. According to Electronic Trend Publications, from 2008 to 2013, Asia is expecting to grow at a CAGR of 9.2% as comparing to 6.3% annual growth for North America and 6.2% annual growth in Europe. The rest of the world is expecting to grow at a 6.0% CAGR over the same period. Asia will represent over 65% of the EMS market by 2013 compared to approximately 17% for North America. STB Industry Overview Cable and Satellite STB were the mainstream in the STB market in 2009. In 2009, the Asian market for STB was estimated to have seen approximately 40% growth in shipments primarily due to the Government project Village-to-Village in China while the North American market was likely up 2.5% primarily due to a temporary surge in Digital Terrestrial STB shipments. Nonetheless, the European market was expected to see an 11% decline in 2009 mainly due to cable operator reduce expenditure in digital set-top-box market. On the other hand, the information/communication technology market is estimated to have 198 million shipments of set-top-box worldwide in 2010 thanks to the trend of converting analog signal into digital signal. Market Intelligence Center (MIC) indicates that beginning 2010 several European Union state members including Spain, Britain, France, and Belgium will intensively convert analog signal to digital signal making Europe the most attractive market. The existing 480 million cable TV subscribers worldwide and the accelerating digitization in emerged market create a demand for over 37 million set-top boxes in 2010. IT research indicates the global market for set-top boxes to begin taking off in 2010 and grow at annual rate of 5-10% in the next three years.

Exhibit 2 : Five Year Trend Global EMS Market Share by Industry 2008 to 2013

Automotive $ 6,350 2.1% $ 8,576 2.0% 6.2%

Communications 88,484 30.1% 123,950 28.5% 7.0%

Computer 105,729 36.0% 166,235 38.2% 9.5%

Consumer 48,886 16.6% 71,444 16.4% 7.9%

Defense/Aerospace/Other Trans. 10,263 3.5% 13,304 3.1% 5.3%

Industrial 20,177 6.9% 27,612 6.4% 6.5%

Medical 14,106 4.8% 23,656 5.4% 10.9%

Total $ 293,995 100.0% $ 434,777 100.0% 8.1%

2008 2013

Revenue (SM) % Revenue (SM) % CAGR

Source : Electronic Trend Publications


Hard-Disk-Drive Industry Overview The hard-disk drive (HDD) market in 2009 was not suffered nearly as much as feared after Q4/08’s collapse. Rather, a mild expansion in 2H/09 was more likely seen with the traditional seasonal growth yet still a 23% of decline as comparing to year before recession. Overall, with consideration of strong volumes shipping from Seagate, Western Digital, and Samsung, it is expected that 2009’s volumes could surpass 2008’s total number of 540 million. Nonetheless, under the impact of economic recession, the market is more likely to grow within 5 years. One main momentum for the growth would be due to the mobile notebook PC area, as these continue to pick-up in growth during slow yet improved economic growth period. On the other hand, computing could be seen as much a bread and butter issue with users all over the world, as the world churns on information globally. Still, for the HDD industry trend, the focus is expected to be how to be cost efficient to match price reductions and how to managing inventory to meet demand. Moreover, monitoring SSD market shall be another concern which should be aware of.

Exhibit 3 : HDD shipments and industry trend 2008-2013

12 M

10 M

8 M

6 M

2 M

0 M

Seagate

14 M

16 M

2007 2008 2009

HDD Terabyte Shipments by Vendor

4 M

WD

HGST

Toshiba

Fujitsu

Samsung

700,000

600,000

500,000

400,000

100,000

0

800,000

900,000

2008

HDD Industry Update 2008 to 2013

300,000

Nov-08 May-09 Prelim Nov-09 Forecast Current Revenue Forecast

$ 30,000

$ 25,000

$ 20,000

$ 15,000

$ 5,000

$ 0

$ 35,000

$ 10,000200,000

2009 2010 2011 2012 2013

Source : IDC Inc.

Source : IDC Inc.


Thou

sand

s of

Uni

ts

$ M

illio

ns

Printer Industry Overview The printer market declined by 24.5% in the 1H2009 to 51.3 million units sold and did not expected to recover until later in 2010. The reasons behind the fall were weak demand as both businesses and consumers reduced spending and the drop in shipments was also impacted by tighter inventory controls in order to minimize inventory levels in the channels. Overall, office market and consumer inkjet market fell 24.5% and 17.3% respectively. Although the sale in 2H2009 did slightly recover due to replacement cycle for business organization, more recovery will be less likely seen till 2H2010. Mobile Industry Overview The mobile handset industry is expected to have 12% contraction in terms of unit shipments in year 2009. In 2008, global mobile handset unit production reached 1/2 billion units. The market is expected to show revival sign in 2010. Worldwide factory revenue from production of mobile handset will reach $162.0 billion in 2012 up from $144.4 billion in 2008 and $117.0 billion in 2009. Exhibit 4 : Worldwide Mobile Handset Production Forecast 2005-2013 (Thousands of Unit/ Millions)

(Source : iSupply) In 2009, because of the extension of replacement cycles, the upgrade sales slowed down in the developed nations. The new device sale has not yet lost its momentum due to the rapid addition of new subscribers in the emerging markets of Asia, Africa and Latin America. This presents unique opportunities of different players in the dynamic mobile handset value chain. However, such opportunity will likely be affected by the emerged market of bandit products. On the other hand, the rapid improvements in social networking and mobile computing platforms have created significant potential for smart-phone & 3G products. Overall, smart phone & 3G handsets will likely became one of dominant mobility products as social networking device worldwide.

1,600,000

1,200,000

0

2,000,000

2005

Worldwide Mobile Handset Production Forecast (Ship-in)

800,000

Mobile Handset Shipments Factory Revenue

1,600,000

1,200,000

400,000

0

2,000,000

800,000

400,000

2006 2007 2008 2009 2010 2011 2012 2013


RISK FACTOR

CCET is committed in developing a comprehensive risk management system dedicated to the financial operation, economic condition, environment, and personnel criteria. Risks may affect our business operations are listed as below. However, this may not be an exhaustive list and unforeseen risks outside of our control may also impact the business operations. 1. Risk associated with operation 1.1 Risks from obsolete inventory The procurement and production plans are made based on customers’ forecast and may subject to change in

order to correspond to the sale conditions. CCET has selective teams and systems constantly monitoring the demand and inventory level in order to respond customer’s need efficiently.

Meanwhile, the Company has adopted make-to-order method as the manufacturing policy. The sales from OEM customers contributed the majority of CCET’s sales and have limited risk of obsolete inventory. The obsolete ratio is at 2.36% as end of Dec.2009. On the other hand, ODM sale bear the inventory risk but is at lesser degree of impact since the revenue from ODM are minimal.

Additionally, the raw materials and obsolete inventories are re-valued by the auditors from time to time and recorded according to accounting standard in order to reflect on time update condition. Further, the Company write off inventories that not be used for 2 year.

1.2 Risks from dependency upon major customers CCET has established long term relationship with our customers by providing quality technical service and working

closely as a team to continuously create competitive advantages for both. Meanwhile, the Company has also committed in expending new customer base to mitigate the dependency on particular customer.

1.3 Risks from dependency upon and competition with the parent companies The Company’s major shareholders of Kinpo Electronics Inc and Compal Electronics Inc are an electronics

manufacturing provider in Taiwan. There is no direct competition among Kinpo, Compal and the Company, as each has its own range of products and R&D team. Kinpo Electronics Inc focuses on the production of calculator. Compal Electronics Inc focuses on the production of notebook while the Company focuses on the production of printers, PCB assembly, mobile phone and set top box. In addition, CCET receives no financial assistance from our major shareholder.

1.4 Risks from competition and technology As an EMS company, CCET is experiencing competition across all markets particularly in cost and technology

skills. In respond to the rapid market change, CCET has continuously improve its manufacturing capability to minimize the cost in order to remain cost competitive and advancing the R&D capability with the aiming of enhanced technology know-how to be updated in the industry. The Company is expecting to invest in research and development in the forthcoming year as well.

1.5 Risks from concentration of purchase and raw material quality The Company established procurement centre to ensure stability of shipping schedule among qualified suppliers

while minimize risks bore by concentrate on particular supplier. Meanwhile, the Company had set up Quality Assurance Centre strictly examines the quality prior the production in order to secure CCET’s profound quality reputation. In addition, materials which consigned by the customers will also following the company qualification procedure to minimize the burden occurred later in the manufacturing process.


The Company had also build up close partnership with the suppliers to minimize the overlap cost while be able to improve the business situation jointly.

2. Risk associated with economic condition and financial market 2.1 Risks from interest rate fluctuation The Company exposure to interest rate risk relates primarily to its cash at banks and borrowings. However, since

most of the Company’s financial assets and liabilities bear floating interest rates or fixed interest rates which are close to the market rate, the interest rate risk is expected to be minimal. Current interest rate is at 0.01~1.71%. Meanwhile, the Company had both long term and short term loan from financial institutions to secure company’s regular operation.

2.2 Risks from foreign exchange volatility The Company exposure to foreign currency risks mainly arise from trading transactions and borrowings that are

denominated in foreign currencies. Consequently, the fluctuation in US dollar may adversely distress the financial performance. Nevertheless, the Company had managed the risks by using natural hedge method and forward exchange contracts when it considers appropriate to minimize possible loss.

CCET is continuously monitoring the global economic and market movements with regards to the exchange rates with the aim of preventing potential loss.


MANAGEMENT STRUCTURE

Executive Committee The Company has two executive committees, that is, the Board of Directors and the Audit Committee, particulars of which are shown below. Board of Directors As of 31st December 2009, the Company’s Board of Directors consists of the following members.

Name Position

Mr. Hsu, Sheng-Hsiung Chairman Mr. Shen, Shyh-Yong Vice Chairman Mr. Chou, Kung-Hsiung Managing Director Mr. Ko, Charng-Chyi Director Mr. Hsu, Sheng-Chieh Director Mr. Thanasak Chanyapoon Director Mr. Alan Kam Chairman of Audit Committee and Independent Director Mr. William Hang Man Chao Audit Committee and Independent Director Mr. Vichai Jittawait Audit Committee and Independent Director

Mrs. Sunadda Jaypong is the Corporate Secretary Authorized Directors The authorized directors are Mr. Hsu, Sheng-Hsiung and Mr. Shen, Shyh-Yong and Mr. Chou, Kung-Hsiung. Either one of signature of authorized directors is authorized to sign on behalf of the Company with the Company’s seal affixed. Scope of authorities and duties of the Board of Directors 1. Duties of the Board of Directors The Board of Directors has applied its knowledge, ability and experience to carefully perform its duties in the

Company’s interests in accordance with the Company’s objectives, regulations and resolutions made to shareholders with the strong commitment to a practice of honest, straight-forwardness and carefulness toward a maximum extent of effort to maintain both the Company and shareholders’ benefits.

2. Duties on the accountability to shareholders The Board of Directors has to have consistently accountability to shareholders, protect the interests of shareholders

and transparently disclose clear information to investors. 3. Review and approval of financial reports and changes in accounting policy The Board of Directors is responsible for approving the financial reports that have been audited and/or reviewed by

the auditor and the Audit Committee, and any changes in accounting policy. 4. Review and approval on appropriateness of business policies The Board of Directors is responsible for reviewing and approving any appropriate policy, budget and direction of

the Company’s business operation and plans as proposed by the Management.


5. Supervision of Management The Board of Directors is responsible for supervising the Management to efficiently perform in the line with the

policy set and for informing the Management in preparing any material reports on the Company’s business operation and other related party transactions in accordance with the rules and regulations of the Office of Security and Exchange Commission and the Stock Exchange of Thailand.

In cases of necessity, the Board of Directors will set third parties to give professional or technical advice on any matter, which may materially affect the Company’s business.

6. Pursuance of internal control and audit system The Board of Directors has to set up and maintain effective internal control system designed to provide the

Management with reasonable assurance that transactions are recorded properly and accurately enough to ensure that the assets are safeguarded and that material frauds and malpractice are precluded. The Board of Directors also appointed the Audit Committee and the internal audit unit to examine the adequacy and the suitability of the internal control system of the Company.

7. Independent performance of non-management directors The independent directors have their own discretion to make decision on any strategy, administration, appointment

of directors and any other material matter affecting the benefits of the Company, including the sufficient and appropriate access to information technology concerning financial and business matters on the interest of the Company.

8. Ethics and etiquette The Board of Directors prepares a compliance manual in relation to the ethics and etiquette of the Management

and staff as guidelines for good and proper practice within the Company. All aforementioned responsibilities can be enforced and approved by the Board of Directors except for the following

items, which require shareholders’ approval. £In compliance with the law, requiring a shareholders’ resolution £Connected transactions as set out in SET or by laws The transactions in which any director has a material interest, directly or indirectly, or has a conflict of interest, the

director(s) has no voting right on such transactions. Audit Committee and Independent Director Definition of “Audit Committee” as the following; 1. Holding not more than 1% of the shares entitled to vote of the Company, subsidiary companies and its affiliated

companies or conflicting juristic persons, shares held by related persons to be included in the calculation. 2. Not being a director who take part in the management; an employee; a staff; an advisor who receives a regular

salary and it not in a position to exert control over the Company, its subsidiaries or fellow-subsidiaries or on any entity likely to give rise to a conflict of interest (at present, and in the two years prior to his appointment)

3. Does not have business dealings with the Company: 3.1 Is not an auditor of the Company 3.2 Does not provide other professional services to the Company such as legal or financial consultancy or appraisal

worth more than Baht 2 million per year.


3.3 Does not have habitual related party transaction by way of rent or lease, whether as lesser or lessee, or real estate, or concerning assets/services or the receipt or provision of financial assistance with a value exceeding Baht 20 million or 3% of NTA, whichever is the lower, including transactions carried out in the one year prior to carrying out of any given transaction.

He must not have business relations as defined in 3.1 to 3.3 above at present, nor in the two years prior to his appointment except where there is necessary and proper reason and in any case not continuously or constantly. An Independent Director or Audit Committee Member may have relations that go beyond those stipulated while performing his office, but only after obtaining the unanimous prior approval of the Company’s Board of Director and subject to the relationship being disclosed per Form 56-1, in the annual report and in the letter of invitation to the Shareholder’s Meeting in the event that the Shareholders’ Meeting is to be asked to renew the term of office of the Independent Director or Audit Committee Member concerned.

4. Is not related by blood or marriage to (i.e. is not the father, mother, spouse, sibling or child of or the spouse of a child of an Administrator, major shareholder or other person in a position of authority or candidate as Administrator or person in a position of authority of the Company or any of its subsidiaries.

5. Has not been appointed to represent a Director or major shareholder or other shareholder that is a related party to a major shareholder.

6. Does not have any other characteristic limiting his independence. 7. An Independent Director having the characteristics set out in points 1 to 6 above may be given powers by the

Board of Directors to decide on matters involving the Company, its subsidiaries, its joint ventures or fellow-subsidiaries or entities likely to have a conflict of interest on a collective decision basis.

As of December 31, 2009, the Company’s Audit Committee and Independent Director consist of the following members; 1. Mr. Alan Kam Chairman of Audit Committee and Independent Directors 2. Mr. William Hang Man Chao Audit Committee and Independent Directors 3. Mr. Vichai Jittawait Audit Committee and Independent Directors Mr. Alan Kam and Mr. William Hang Man Chao have the knowledge to review the financial statement. Scope of authorities and duties of the Audit Committee (1) To review the Company’s financial reporting process to ensure that it is accurate and adequate. (2) To review the Company’s internal control system and internal audit system to ensure that they are suitable and

efficient, to determine and internal audit unit’s independence, as well as to approve the appointment, transfer and dismissal of the chief of an internal audit unit or any other unit in charge of an internal audit.

(3) To review the Company’s compliance with the law on securities and exchange, the Exchange’s regulation, and the law relating to the Company’s business.

(4) To consider, select and nominate an independent person to be the Company’s auditor, and to propose such person’s remuneration, as well as to attend a non-management meeting with an auditor at least once a year.

(5) To review the Connected Transactions or the transactions that may lead to conflicts of interests, to ensure that they are in compliance with the laws and the Exchange’s regulations, and are reasonable, and are reasonable and for highest benefit of the Company.

(6) To prepare, and to disclose in the Company’s annual report, an audit committee’s report which must be signed by the audit committee’s chairman and consist of at least the following information:

(a) An opinion on the accuracy, completeness and creditability of the Company’s financial report. (b) An opinion on the adequacy of the Company’s internal control system. (c) An opinion on the compliance with the law on securities and exchange, the Exchange’s regulations, or the laws

relating to the Company’s business. (d) An opinion on the suitability of an auditor.


(e) An opinion on the transactions that may lead to conflicts of interests. (f) The number of the audit committee meetings, and the attendance of such meetings by each committee member. (g) An opinion or overview comment received by the audit committee from its performance of duties in accordance

with the charter. (h) Other truncations which, according to the audit committee’s opinion, should be known to the shareholders and

general investors, subject to the scope of duties and responsibilities assigned the Company’s board of directors. (7) To perform any other act as assigned by the Company’s board of directors, with the approval of the audit committee. Management As of December 31, 2009, the management comprises of 5 persons, as follows; 1. Mr. Chou, Kung-Hsiung Managing Director 2. Mr. Lai, Chi-Tien Vice President Administration 3. Mr. Yeh, Tien-Kung Accounting controller 4. Mr. Huang, Ko-Wei Vice President Manufacturing 5. Mr. Wang, Wei-Chao Vice President Manufacturing Scope of authorities and duties of the Managing Director 1. Make a decision on important matters, set duties, objectives and direction of the Company’s business policy

including supervising overall operation performance, customer relation and marketing for businesses in foreign countries and being responsible to the Board of Directors.

The financial transactions such as guarantee debt and lending, the Managing Director do not have the authority to do so but should depend on the Board of Director’s approval.

2. Approve annual budget of the Company 3. Approve credit limit given to customers, payment period, and product sales contracts including changes in trade

conditions, making guarantee contracts and obsolete inventory management. 4. Have authorities to purchase permanent assets with the investment of no more than Baht 20 million. 5. Have authorities to invest in a new project with the investment of no more than Baht 20 million. 6. Set and approve standard of personnel management and of employees’ salary adjustment. 7. Approve consultant appointment that is necessary to business operation 8. Perform any other duties related to the Company’s general operation, not including operation of inter-related

transactions and any transaction regarding purchase or disposal of material assets of the listed company according to the rules and regulations of the Stock Exchange of Thailand.

The above authorities, entitled to the Managing Director, have to follow the laws and bylaws of the Company. In case of any transaction, which affects or may affect on interest of the Managing Director or connected persons, Managing Director has no authority to approve it and has to propose the issue to the Board of Directors for consideration. Besides, in case that the transactions incurred are inter-related or relate to purchase or disposal of material assets of the Company or its subsidiaries, these transactions are required to have approval from shareholders and/or to comply with the rules, conditions and procedures in the relevant regulations of the Stock Exchange of Thailand regarding these particular matters. Selection of Directors and Executives The Company does not have any nomination committee to appoint the directors. However, according to the Company’s guideline, the directors are selected by the Board of Directors by concerning on experience, vision, abilities and characteristics.


The Board of Directors At annual General shareholders’ meeting, the directors should resign from the Board at least one-third of the total number of directors. If the number of directors cannot be divided into exactly three parts, they should be retired by the number closest to one-third. And in case that any retired director is re-elected, a resolution of the shareholders’ meeting will be required. At the time of candidate’s nomination for the Board of Directors, the Company will prepare a list of details and information about such candidates for the shareholders’ consideration, which have to follow the rules and procedures below. 1. One shareholder is entitled to one vote per share. 2. Each shareholder will exercise the right under item no.1 to elect one or more persons to be member of the Board

of Directors, but cannot divide up his or her votes and allocate such vote for any one candidate. 3. The candidates obtaining the highest numbers of votes should be appointed directors, until all vacancies are filled.

Should be a tied vote, the Chairman of the meeting shall have a casting vote. In the event that the position of the Board of Directors is vacant whatever the reason is except when the term of the position is completed, the Board of Directors has to elect person(s) having proper qualifications and being not illegal according to the laws of public company. The vacant position will be filled in the next BOD’s meeting, except the remaining term is less than 2 months. The elected person will be in the position for the rest of the term of the retired director. The resolution of the Board of Directors should get the voting of not less than three-fourth of the total number of the existing directors. Audit Committee and independent directors Shareholder will be able to appoint the Audit Committee and independent directors during shareholder’s meeting. The term of the appointment is 3 years and can be re-elect after the term expired. The qualifications of the Audit Committee member and independent director are specified in page 31 and 32. Management’s remuneration Directors’ remuneration for year 2009 All the directors received bonus in the total of 19.40 million Baht in year 2009 form the performance of the year 2008.

Remuneration

Name Bonus Meeting Allowance

Mr. Hsu, Sheng-Hsiung 6,000,000 480,000 Mr. Shen, Shyh-Yong 2,000,000 360,000 Mr. Chiang, Hsiao-Chin* 3,000,000 - Mr. Hsu, Sheng-Chieh 1,200,000 180,000 Mr. Ko, Charng-Chyi 1,200,000 180,000 Mr. Chou, Kung-Hsiung 1,200,000 180,000 Mr. Thanasak Chanyapoon 1,200,000 180,000 Mr. Alan Kam 1,200,000 180,000 Mr. William Hang Man Chao 1,200,000 180,000 Mr. Vichai Jittawait 1,200,000 180,000

Total 19,400,000 2,100,000


Remark : Mr. Chiang, Hsiao-Chin was the vice chairman of the Company on January 1 - August 13, 2008 and the Board of Director has appointed Mr. Shen, Shyh-Yong to replace Mr. Chiang, Hsiao-Chin since August 13, 2008. Therefore, bonus for a vice chairman of Baht 5,000,000 has been allocated to the period of tenure of directors. Remuneration of the Management Remuneration of the 5 management members team including salary and bonus in 2009 amounted to Baht 14,122,371. Other benefits - None -


Mr. Lai, Chi-Tien Vice President Administration

Audit Committee

Internal Audit Manager Mr. Hsu, Sheng-Hsiung Chairman


Mr. Chou, Kung-Hsiung Managing Director

Mr. Yeh, Tien-Kung Accounting Controller

Mr. Huang, Ko-Wei Vice President Manufacturing

Mr. Wang, Wei-Chao Vice President Manufacturing

BOARD OF DIRECTORS

MANAGEMENT STRUCTURE


CORPORATE GOVERNANCE

The Company has initiated policies conforming to the Code of Best Practices of the directors of listed companies according to the procedures of the Stock Exchange of Thailand. The Company values the principle of good corporate governance, considering all stakeholders and society as a whole. The Company has set the good corporate governance policy that has been approved by The Board of Directors as followings: £Issued policy for the Rights and Equitable Treatment Shareholders and various groups of stakeholders. £Managed through absolute responsibility and oversaw any conflict of interests by the Board of Directors. £Verified financial statement and connected transaction with related parties through proper control and internal audit, which include business operation and risk management. £Operated business with transparency and disclosure of information in an adequate, reliable and punctual manner. £Performed under Code of Ethics by Directors and employees. The following lists corporate governance policy reported in 5 separate categories, as mandated by the Stock Exchange of Thailand. 1. The Rights of shareholders Basic shareholder rights are rights to buy/sell or transfer shares, share in the profit of the Company, obtain relevant and adequate information on the Company in a timely manner and on a regular basis, participate and vote in the shareholder meetings to elect or remove members of the board, appoint external auditor, and make decisions on any transactions that affect the Company such as dividend payment, amendment to the Company’s articles of association or the Company’s memorandum of association, capital increases or decreases, the approval of extraordinary transaction and approval on important transactions influencing directions of the Company. In year 2009, besides the above-mentioned rights of the shareholders, the Company proceeded to carry out the necessary work which encourages shareholders to use their rights as the following: 1. In year 2009, the Company held Annual General Shareholders’ Meeting on March 27, 2009 at 10.00 a.m. at the

Four Wings Hotel (Bangkok), 3rd Floor (Kanyalak Room A,B), 40 Sukhumvit Rd., Soi 26, Khet Klongtoey, Bangkok which has the voting according to the minutes. The Company delivered an invitation letter, the agenda of each meeting as well as supplementary documents to the shareholders no less than 14 days prior to the meeting date according to the laws through the Company’s shares registrar.

2. Release the detailed information on agendas of the shareholders’ meeting and post on the Company’s website (www.calcomp.co.th) 30 days before the meeting date, these information is same with the documents that the Company distributed to shareholders. Moreover, the Company informed clarifying all shareholders to attend the meeting and the rights to vote on resolutions via SCP client of The Stock Exchange of Thailand.

3. Provide shareholders full rights to vote and in case of the shareholders who unable to attend the meetings are entitled to appoint a representative to attend the meeting.

4. The Company used the Barcode System in the Annual Shareholders’ Meeting for shareholder registration and voting process in order to demonstrate voting transparency.

5. The Company held the meeting at a convenience location and set up a suitable meeting room for the shareholders. The Company also gave an opportunity to shareholders to express their question with the Company’s Investor Relations Department before the meeting.


2. The Equitable Treatment of Shareholders The Company gives the importance in the equitable treatment of shareholders to all shareholders. 1. The Company invited all shareholders of the Company to propose any matter that they deem significant to be

included in an agenda of the Annual General Shareholders’ Meeting 2009. The Company made announcement on the Company’s website and the SCP Client of Stock Exchange of Thailand. Proposed agendas can be sent to the Company via Investor Relations Department’s e-mail address at [email protected] or postal within specific period. For the Annual General Shareholders’ Meeting 2009, no any agendas proposed by shareholders.

2. The Company invited the shareholders to propose a qualified candidate for directorship for the Annual General Shareholders’ Meeting 2009, the shareholders must be the Company’s shareholder holding continuously minimum shares in an amount 0.05 percent of the total shares either by one or several shareholders combined. And, Shareholders must have held those shares continuously for at least 12 months by the date the shareholder nominates a qualified candidate. The Company had announced the qualification of candidate, the regulation and the support documents by posted on the Company’s website for shareholders to study the detail information. The proposed a qualified candidate and supporting documents can be sent to the Company via Investor Relations Department’s e-mail address at [email protected] or postal within specific period. For the Annual General Shareholders’ Meeting 2009, no any candidate was proposed by shareholders.

3. In case of the shareholders who are unable to attend the meetings are entitled to appoint representative e.g. Independent Director or a person to attend the meeting to act as their proxy by using proxy form sent to them along with the invitation of the meeting. The proxy forms can be downloaded from the Company’s website.

4. On the shareholders’ meeting, the chairman gives an opportunity to shareholders in auditing the Company’s business operation, questioning, showing their opinions and giving advices and also uses this opportunity to clarify the performance, future outlook to make the shareholders better understand the Company’s business. There is no limitation of late shareholders to attend the meeting and no other any agenda added without notifying shareholders.

5. In appointment director agenda, the Company gives the chance to the shareholders in voting by person in order to be transparent and more independent for election.

6. Allocate the rights to vote at the meetings according to the number of shares owned by each shareholder, allowing one share one vote and using the voting card on every agenda.

7. In the AGM meeting, the Company has completely recorded by writing the minutes of the meeting by separate voting point to Agreed, Disagreed and abstained of each agenda, attendant and absent list of director, voting process and Q&A in the meeting and also video recorded the entire meeting. The completed minutes of the meeting were post on the Company’s website within 14 days after the meeting.

8. Established measures to control the usage and prevent the misuse of internal information (insider trading) for benefit of a person concerned by prohibit them from trading the Company securities for 30 days before financial statement released and at least 24 hours after the information is widely spread out to the public. The Company will remind directors, managements and person concerned before releasing financial statements. In case any directors and management staff sell or buy the Company securities, they are required to report the shareholdings to SEC within a 3-business day period for public disclosure.

9. Give an opportunity to minor shareholders and investors to visit the factory.


3. Role of Stakeholders The Company pays attention to every stakeholder as stated in the following details: 1. Shareholders and Investors The Company operates the business to for the benefit to all stakeholders. Moreover, the Company also set up

policies to give rights to all shareholders and investors in acquiring the Company’s information transparently and reliably.

2. Employee The Company views the employees as a major asset and treats all employees fairly in welfare, benefit,

environment, safety in working and health care for employees as follows: £Provide lunch meal and dinner for the overtime employee. £Give the incentive reward to the employees who come to work on time everyday. £Provide the Provident Fund to the employees. £Create environmental campaign in the factory and the office. £Arrange the Annual Physical Check up to the employees. £Allotted the warrant (CCET-W2) to employees as the ESOP £Provide the Nurse room in every factory to assure the emergency case for every employee. £Operate the morning meeting to ensure the understanding in solving and increase the knowledge to the

employees to do the right job at the first time. Moreover, the Company also has the inbound and outbound training to develop the working skill continuously.

Moreover, access to senior management is granted and expressed on the Employee Handbook. “Whistle Blowers” will be properly protected and rewarded if their allegations are found to be true.

3. Customer Customer information is treated as strictly confidential according to the Business Ethics in order to build the good

and long standing relationship between the Company and the customers.

4. Supplier The Company treats all suppliers as business partners, and works with all in building a long-term relationship.

5. Creditor The Company conducts business according to the business agreement and gives accurate and factual information to

all creditors.

6. Business Competitor The Company commits to doing business in a fair and equitable manner.

7. Society The Company realizes the safety of social and environment and the quality of life in society where the Company

located, thus CCET intends to follow the law and regulation strictly and continuously supporting corporate Social Responsibilities Program.

8. Environment The Company has set the environmental policy and everyday at CCET is regarded as worldwide environment day.

Moreover, the Company also establishes the environment committee to reinforce the ideal of the employees participating in environmental perseverance both inside and outside the factory.


4. Disclosure and Transparency The Company ensures that all-important information relevant to the Company, both financial and non-financial, is disclosed correctly, accurately, on a timely basis and transparently through easy to access channels that are fair and trustworthy. The Company shall disclose the following information. 1. Disclose duties and responsibilities of the Board of Directors and also reveal the attendance records and the report

of the Board of Director. The Board of Directors is responsible for the Company’s consolidated financial reports and financial information appearing in the annual reports. The financial statements are prepared based on the accounting standards generally accepted in Thailand by using the appropriate accounting policy.

2. The Company disclosed information on remuneration of all directors. The Company has established remuneration to the directors in a precise and transparent manner and submitted to the Annual General Shareholders’ meeting for approval. The remuneration to the management must conform to the procedures and policies set by the Board of Directors, which must also coincide with the Company’s performance and the performance of each management.

3. Disclose the policy environmental of the Company. 4. Disclose the policy on corporate governance complied with the policy. 5. The Company set up the Investor Relations. As a result, the Company emphasizes on disclosing information that is

adequate, accurate, trustworthy, consistent, and punctual. Regarding the investor relations, the Company has designated an investor relation department to communicate with the shareholders, institutional investors, individual investors and financial analysts including the interested parties.

The Investor Relations representatives: Ms. Jenny Chou Investor Relations Manager Tel. 0-2261-5033-37 Fax. 0-2661-9396 E-mail : [email protected] Website : www.calcomp.co.th Khun Sunadda Jaypong Corporate Secretary Tel. 0-2261-5033-37 Fax. 0-2661-9396 E-mail : [email protected] Website : www.calcomp.co.th 6. Disclose up-to-date information both Thai and English version on the Company’s website. 5. The Responsibilities of the Board The Board of Directors plays an important role in corporate governance for the best interest of the Company. The Board is accountable to shareholders and independent of management. The number of directors is currently limited to nine divided to 2 committees, the Company’s directors consist of 1 Executive Directors and 8 Non-Executive Directors. The Chairman of the Company is not the same one as the Managing Director, and the duties and authorities of the Board of Directors and of the Managing Director are clearly separated. The Company has 3 independent directors who provide check and balance, independence and represent all minority shareholders. The Board of Directors has appointed the Audit Committee to assist in the corporate governance of the Company. Name list, duties and authorities of the Audit Committee are as what mentioned in Management Structure part. The Audit Committee will arrange one meeting every 3 months.


When considering the matters presented to the Board, all member of the Board are allowed to express their opinions freely, resolutions are passed by majority vote, providing that one director is eligible for one vote. After the meeting, the secretary of the Board is responsible for preparing the minutes and certified the correctly by Chairman and Vice Chairman. The minutes must than be approved by next board meeting.

Leadership and Vision The Company has set the vision to be the leader in Electronics Manufacturing Services (EMS) and provided the best service and total solution to the customers all over the world. The Board of Directors has participated in the set up of the Company’s vision, mission, strategies, objectives business plan and budgets and also in supervising the Management to achieve the Company’s goals within the budget.

Board of Directors’ meeting The Board of Directors arranges a meeting for every 3 months to consider the results of operation and the financial statements. Besides, the Board sets visions, goals, strategies, and provides policies to the Company, supervises and controls operation. Special meeting may be arranged if necessary, and an invitation letter with specific agenda will be sent to the Board of Directors 7 days prior to the meeting to give the Board of Directors an appropriate time period in investigation. In 2009, the Company had arranged a total of 5 meetings comprised of 4 regular meetings and 1 special meeting. In each meeting, at least half of the directors must participate according to the Company’s article. The Company’s Board of Directors consists of the following members and meeting attendance.

Board Meeting

Name Position Meeting Attendance

1. Mr. Hsu, Sheng-Hsiung Chairman 4/5 2. Mr. Shen, Shyh-Yong Vice Chairman 5/5 3. Mr. Chou, Kung-Hsiung Managing Director 5/5 4. Mr. Ko, Charng-Chyi Director 4/5 5. Mr. Hsu, Sheng-Chieh Director 3/5 6. Mr. Thanasak Chanyapoon Director 5/5 7. Mr. Alan Kam Chairman of Independent Director 5/5 and Audit Committee 8. Mr. William Hang Man Chao Independent Director and Audit Committee 5/5 9. Mr. Vichai Jittawait Independent Director and Audit Committee 5/5

Audit Committee Meeting

Name Position Meeting Attendance

1. Mr. Alan Kam Independent Director and 4/4 Chairman of Audit Committee 2. Mr. William Hang Man Chao Independent Director and Audit Committee 3/4 3. Mr. Vichai Jittawait Independent Director and Audit Committee 4/4


Conflict of Interests In case of the conflict of interests or the relevant topic, the Board of Directors and the Audit Committee will reasonably consider in that topic in according to the relevant rules and regulations of The Stock Exchange of Thailand. The price and conditions should be similar to Arm’s Length Basis and has disclosed details, transaction value, and reason/necessity in connected transaction report.

Business Ethics The Company has set rules on business ethics in the way that SET gave as a guideline for executives to perform. And these rules guide the executives and employees of the Company to follow carefully and regularly. The Company has employee handbook so as to set a standard for work, quality and practice.

Remuneration for Directors and Management The Company has established remuneration to the directors in a precise and transparent manner. The remuneration policy is no more than 2 % of the net profit in each year and should be approved by shareholders’ meeting. The remuneration of the directors will be proposed to the Annual General Shareholders’ meeting to approve.

Internal Control System The Company recognizes the importance of internal control system at both the executive level and the operational level. The Company has proper guidelines and operation manuals for all its employee. The Company has an internal control system regarding the financial system to propose the financial reports to the supervisors.

Risk Management The Audit Committee is responsible for considering the risk factor report of the Company by quarterly review and reporting to the Board of Directors in order to mange the risk factor that will impact to the Company.

Knowledge Development The Company encourages the Board of Directors to attend seminars for knowledge development and continuously presents up-to-date information including SET, SEC and relevant organization newsletter to all levels of staff.


RELATED PARTY TRANSACTIONS

Ramark : £Kinpo Electronics Inc. holding 100.00% in Kinpo International Co., Ltd. £Kinpo Electronics Inc. holding 44.82% in Vibo Telecom Co., Ltd. £Compal Electronics Inc. holding 40.41% in Vibo Telecom Co., Ltd. £Kinpo Electronics Inc. holding 23.43% in Acbel Polytech Inc. £Kinpo Electronics Inc. holding 51.61% in Crownpo Technology, Inc.

The relationship between the Company and the related parties are summarised below.

Name of related parties Relationship with the Company

Kinpo Electronics, Inc. Major shareholders Logistar International Holding Co., Ltd. Subsidiary company Cal-Comp Electronics (Suzhou) Co., Ltd. Subsidiary company Cal-Comp Optical Electronics (Suzhou) Co., Ltd. Subsidiary company Cal-Comp Electronics & Communications Co., Ltd. Subsidiary company Cal-Comp Technology (Suzhou) Co., Ltd. Subsidiary company Cal-Comp Electronics and Communications (Suzhou) Co., Ltd. Subsidiary company A-Ten Technology Co., Ltd. Associated company (held by a subsidiary company) Wise Sigma International Holding Co., Ltd. Associated company (held by a subsidiary company) Telian Corporation Associated company and common directors inx Japan International Inc. Shareholding by the Company Zakang Inc. Shareholding by the Company Kinpo Group Management Service Co., Ltd. Shareholding by the subsidiary company Doctor Mobile Incorporated Shareholding by the subsidiary company Kinpo Electronics, Inc. (China) Co., Ltd. Subsidiary of the major shareholder Kinpo Electronics (Beijing) Co., Ltd. Subsidiary of the major shareholder Kinpo Electronics (Shanghai) Co., Ltd. Subsidiary of the major shareholder SaveCom International, Inc. Subsidiary of the major shareholder Kinpo International Co., Ltd. Common shareholders Vibo Telecom Co., Ltd. Common shareholders Acbel Polytech Inc. Common shareholders Crownpo Technology, Inc. Common shareholders


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s the

common

dire

ctors

- A/

R 8.52

Kinp

o Internation

al Co

., Ltd.

was

clos

e to th

e m

arke

t pric

e no

rmal

busin

ess

prac

tice

with

the

Com

pany

as

and

the

cond

itions

were

in

follo

ws:

line

with

the

norm

al bu

sines

s

1. M

r. Hs

u, S

heng

-Hsiu

ng

prac

tice.

2. M

r. Hs

u, S

heng

-Chie

h

- Pu

rcha

se

0.07

Th

e Co

mpa

ny p

urch

ased

raw

The

price

of t

he tr

ansa

ction

was

Th

e Tran

saction

is

- A/

P 0.06

m

aterial

from

Kinp

o

close

to th

e m

arke

t pric

e an

d no

rmal

busin

ess

prac

tice

Internation

al Ltd.

the

cond

itions

were

in lin

e wi

th

the

norm

al bu

sines

s prac

tice.

(2) L

ogist

ar

Internation

al

Ho

lding

Co., L

td.

- Sa

les

18.48

Logis

tar I

nterna

tiona

l Hold

ing

The

price

of t

he tr

ansa

ction

was

Th

e Tran

saction

is

- A/

R 10

.35

Co.,

Ltd. s

old p

rodu

ct to

Kinp

o c

lose

to th

e m

arke

t pric

e an

d no

rmal

busin

ess

prac

tice

Internation

al Ltd.

the

cond

itions

were

in lin

e wi

th

the

norm

al bu

sines

s prac

tice.

(3) C

al-Co

mp

Elec

tronic

s an

d

Co

mm

unica

tion

(Suz

hou) C

o., L

td.

- Se

ll m

achin

e

79.66

Cal-C

omp

Elec

tronic

s an

d Th

e price

of t

he tr

ansa

ction

-

an

d eq

uipm

ent

Co

mm

unica

tion

(Suz

hou)

was

boo

k va

lue p

lus o

peratio

n

Co

., Ltd. s

old m

achin

e an

d

fees

.

eq

uipmen

t to

Kinpo

Internati

onal

Co

., Ltd.


Pa

rty

whi

ch m

ay

Am

ount

Nec

essi

ty o

f Th

e op

inio

n

have

con

flict

s

Des

crip

tion

of

for

2009

and

reas

on fo

r of

Aud

it

of in

tere

st

Rela

tions

hip

tran

sact

ions

(M

B)

Des

crip

tion

tran

sact

ions

Co

mm

ittee

4. A

cbel

Polyt

ech

Inc.

Com

mon

sha

reho

lders,

(1) T

he C

ompa

ny

Kinp

o Elec

tronic

s Inc.

- Pu

rcha

se

28.40

The

Com

pany

purch

ased

raw

The

price

of t

he tr

ansa

ction

Th

e Tran

saction

is

ho

lding

23.43

% in

Acb

el

- A/

P 5.57

m

aterial

from

Acb

el Po

lytec

h was

clos

e to th

e m

arke

t pric

e no

rmal

busin

ess

prac

tice

Po

lytec

h Inc.

It als

o ha

s

Inc.

and

the

cond

itions

were

in

the

com

mon

dire

ctors

line

with

the

norm

al bu

sines

s

with

the

Com

pany

,

prac

tice.

M

r. Hs

u, S

heng

-Hsiu

ng

- Ad

vanc

e fro

m

0.63

Th

e Co

mpa

ny re

ceive

d ad

vanc

e No

interest

betw

een

the

partie

s. T

he T

rans

actio

n is

relat

ed p

arty

for p

rodu

ct re

work

from

Acb

el Th

e co

nditio

n was

in line

with

no

rmal

busin

ess

prac

tice

Po

lytec

h Inc.

the

norm

al bu

sines

s prac

tice.

(2) L

ogist

ar

Internation

al

Ho

lding

Co., L

td.

- Sa

les

1.99

Lo

gistar I

nterna

tiona

l Hold

ing

The

price

of t

he tr

ansa

ction

Th

e Tran

saction

is

Co

., Ltd. s

old p

rodu

ct to

Acb

el was

clos

e to th

e m

arke

t pric

e

norm

al bu

sines

s prac

tice

Po

lytec

h Inc.

and

the

cond

itions

were

in

line

with

the

norm

al bu

sines

s

prac

tice.

(3) C

al-Co

mp

Optic

al

Elec

tronic

s

(Suz

hou) C

o., L

td.

- Pu

rcha

se

8.76

Ca

l-Com

p Op

tical

Elec

tronic

s Th

e price

of t

he tr

ansa

ction

Th

e Tran

saction

is

- A/

P 0.02

(Suz

hou) C

o., L

td. p

urch

ased

was

clos

e to th

e m

arke

t pric

e no

rmal

busin

ess

prac

tice

raw m

aterial

from

produ

ct to

an

d the

cond

itions

were

in

Ac

bel P

olytech

Inc.

line

with

the

norm

al bu

sines

s

prac

tice.


Pa

rty

whi

ch m

ay

Am

ount

Nec

essi

ty o

f Th

e op

inio

n

have

con

flict

s

Des

crip

tion

of

for

2009

and

reas

on fo

r of

Aud

it

of in

tere

st

Rela

tions

hip

tran

sact

ions

(M

B)

Des

crip

tion

tran

sact

ions

Co

mm

ittee

5. K

inpo

Elec

tronic

s, Inc.

The

subs

idiary

com

pany

(1) C

al-Co

mp

(C

hina)

Co.,

Ltd.

of K

inpo

Elec

tronic

s, Inc.

Elec

tronic

s

(Suz

hou) C

o., L

td.

- Pu

rcha

se

0.16

Ca

l-Com

p Elec

tronic

s (Suz

hou)

The

price

of t

he tr

ansa

ction

Th

e Tran

saction

is

Co

., Ltd. p

urch

ased

raw

was

clos

e to th

e m

arke

t pric

e no

rmal

busin

ess

prac

tice

m

aterial

from

Kinp

o Elec

tronic

s, an

d the

cond

itions

were

in

Inc.

(Chin

a) Co

., Ltd.

line

with

the

norm

al bu

sines

s

prac

tice.

- Se

ll m

achin

e

an

d eq

uipm

ent

127.92

Ca

l-Com

p Elec

tronic

s (Suz

hou)

The

price

of t

he tr

ansa

ction

-

Co

., Ltd. s

old m

achin

e an

d

was

boo

k va

lue p

lus o

peratio

n

eq

uipm

ent t

o Kinp

o

fees

.

Internation

al Co

., Ltd.

(2) C

al-Co

mp

Elec

tronic

s an

d

Co

mm

unica

tion

(Suz

hou) C

o., L

td.

- Se

ll m

achin

e 0.21

Ca

l-Com

p Elec

tronic

s an

d

The

price

of t

he tr

ansa

ction

-

an

d eq

uipm

ent

Co

mm

unica

tion

(Suz

hou)

was

boo

k va

lue p

lus o

peratio

n

Co

., Ltd

sold

mac

hine

and

fees

.

eq

uipm

ent t

o Kinp

o Elec

tronic

s,

Inc.

(Chin

a) Co

., Ltd.


Pa

rty

whi

ch m

ay

Am

ount

Nec

essi

ty o

f Th

e op

inio

n

have

con

flict

s

Des

crip

tion

of

for

2009

and

reas

on fo

r of

Aud

it

of in

tere

st

Rela

tions

hip

tran

sact

ions

(M

B)

Des

crip

tion

tran

sact

ions

Co

mm

ittee

6. K

inpo

Grou

p

Held

by C

al-Co

mp

(1) C

al-Co

mp

M

anag

emen

t Servic

e Elec

tronic

s an

d

Elec

tronic

s an

d

Co.,

Ltd.

Com

mun

icatio

n Co

., Ltd.

Co

mm

unica

tion

12.50%

Co.,

Ltd.

- Ot

her e

xpen

ses

4.50

Ca

l-Com

p Elec

tronic

s an

d Co

ntract p

rice

-

Co

mm

unica

tion

Co.,

Ltd. p

aid

the

cons

ultan

t fee

s to K

inpo

Gr

oup

Man

agem

ent S

ervic

e

Co

., Ltd.

7. S

ave

Com

Internation

al,

The

subs

idiary

com

pany

(1) C

al-Co

mp

Inc.

of K

inpo

Elec

tronic

s, Inc.

Elec

tronic

s an

d

Com

mun

icatio

n

Co.,

Ltd.

- Ot

her e

xpen

se

3.19

Ca

l-Com

p Elec

tronic

s an

d Co

ntract p

rice

-

- A/

P 0.21

Co

mm

unica

tion

Co.,

Ltd. p

aid

for t

eleph

one

system

to

Sa

ve C

om In

ternation

al, In

c.


Pa

rty

whi

ch m

ay

Am

ount

Nec

essi

ty o

f Th

e op

inio

n

have

con

flict

s

Des

crip

tion

of

for

2009

and

reas

on fo

r of

Aud

it

of in

tere

st

Rela

tions

hip

tran

sact

ions

(M

B)

Des

crip

tion

tran

sact

ions

Co

mm

ittee

8. A

-Ten

Tec

hnolo

gy

Held

by L

ogist

ar

(1) L

ogist

ar

Co

., Ltd.

Internation

al Ho

lding

Internation

al

Co

., Ltd. 3

4%

Ho

lding

Co., L

td.

- Ot

her A

/R

11.97

Logis

tar I

nterna

tiona

l Hold

ing

Book

Valu

e -

Co

., Ltd

had

decrea

sed

the

inv

estm

ent i

n A-

Ten

Tech

nolog

y

Co

., Ltd. fr

om 5

5% to

34%

.

Ho

wev

er, t

he d

ecreas

ed

inv

estm

ent p

roce

ed is

not p

aid

ba

ck to

Log

istar, t

herefore,

Lo

gistar h

as re

cord th

is am

ount

as

other A

/R.

- Sh

ort t

erm

76

.91

Logis

tar I

nterna

tiona

l Hold

ing

No in

terest

betw

een

the

parties

Th

e Co

mpa

ny s

hould

loa

ns

Co

., Ltd.

sold

prod

ucts

to A

-Ten

due

to th

is tra

nsac

tion

is follo

w th

e de

bt c

losely

.

in

year 2

006

and

there

is

occu

rred

from

A/R

ou

tstand

ing A

/R fo

r 173

.73

MB.

As

this

A/R

was

ove

r due

for

m

ore

than

1 y

ear,

then

aud

itor

of L

ogist

ar w

as a

djusted

this

A/

R to S

hort

term

loan

s by

follo

ws

the

acco

untin

g stan

dard

of T

aiwan

. The

Com

pany

has

bo

oking

the

allow

ance

dou

btful

ac

coun

t for 3

8 M

B.


Supply/Manufacturing Agreement Parties concerned : Cal-Comp Electronics (Thailand) Public Company Limited and Kinpo Electronics, Inc. (a company incorporated under the laws of Taiwan). Execution date : 1st April 2004 Material subject : The term of the agreement applies to each purchase by Kinpo to Cal-Comp of the goods and services as specifies in the Purchase Order and 1. Cal-Comp shall notify Kinpo in advance and in writing of any proposed change in method of producing or testing, subcontractors for producing, processing and testing, site of manufacture and labeling. 2. All products shall meet the specifications and shall be subjected to quality control inspection by Cal-Comp in accordance with Cal-Comp’s quality control standards. Cal-Comp shall permit Kinpo to review periodically Cal-Comp’s production and quality control procedures and records and to visit Cal-Comp’s facilities. Expiry date : The Agreement shall continue in full force and effect for one year. The agreement shall be renewed and effective for another one year if there is no objection before the end of the above effective period. Joint Venture Agreement Parties concerned : Cal-Comp Electronics (Thailand) Public Company Limited and Telian Corporation (a company incorporated under the laws of Korea). Execution date : 2nd April, 1998 Material subject : The Company shall be entitled to the following benefits. 1. Know-how : the Company is authorized to apply know-how, patents, technology and formulae in connection with the production or sale of cordless telephones and other telecommunications equipment owned, designed and developed by Telian Corporation during the validity of the Joint Venture Agreement at the fair market price. 2. Production : the Company is entitled to the first right refusal in connection with any new product designed and developed by Telian. Parties concerned will determine the remuneration and other relevant contractual conditions from time to time. Expiry date : This Agreement shall be terminated upon occurrence of any of the following events. 1. Both parties agree to terminate the Agreement. 2. Either party claims for compensation from any defaulting party, but the latter fails to pay the compensation within the period of 30 days. License Agreement Parties concerned : Cal-Comp Electronics (Thailand) Public Company Limited and Zakang Inc. (a company incorporated under the laws of Korea). Execution date : 25th September, 2000 Material subject : 1. The Company is granted exclusive right to use patents and know-how for production owned by Zakang throughout the validity of the Agreement. 2. Zakang agrees to provide technical assistance for production of pagers. 3. The Company is entitled to sell Zakang-technology pagers in any country, except Korea. Expiry date : This Agreement shall be terminated upon occurrence of any of the following events. 1. Either party breaches any provision thereof, and fails to remedy within the period of 60 days.


2. Either party participates in the bankruptcy proceedings. 3. Either party becomes an injured party due to any Act of God for an uninterrupted period of more than 6 months from the date of notice given by the other party. Use-Right of Land Agreement Parties Concerned : Cal-Comp Electronics(Thailand) Public Company Limited and Wujiang State-Owned Land Administration Bureau Execution Date : 4th June 2002 Material Subject : The Company is granted 50 years usage-right of state-owned land of Wujiang City for constructing plant. The constructed area and design for each building must be subjected to the layout of the city, and constructed as per ratified designing program. Expiry Date : 3rd June 2052 The contract may be terminated, if Cal-Comp delays the payment until 60 days. Criteria or steps in approving related company transactions The Board of Directors has appointed the Managing Director the authority to approve transactions with related parties under normal business conditions, which must conform to the regulation of Securities and Exchange Act and rules, notifications, and notice of the Stock Exchange of Thailand including the rules regarding the disclosures of related transactions, the acquisition or disposition of the material assets of the Company or its subsidiary company according to the generally accepted accounting standards in Thailand. The assigned authority must conform to the laws and the Company’s bylaws. In case that there is any transaction which has or may have the conflict of interests of Managing Director or related persons, the Managing Director has no rights to approve such transaction and has to propose such transaction to the Board of Directors for consideration. Moreover, the related company transaction or the transaction related to the acquisition or disposition of the material assets of the Company or the subsidiary company, as the case may be, has to be approved by the shareholders’ meeting and/or any action under the related regulations or methods to conform to the notifications of the SET. Policy and trend of future related company transactions The Company’s policy is to operate business for utmost benefits of the Company and its subsidiary companies. Under normal business operation, the Company and its subsidiary companies must incur into sales or service transactions with related companies. Therefore, the Company and its subsidiary companies will continue to have the related company transactions under the normal business conditions with the fair or market price, which is able to compare to the transaction with others. Method to protect investors To protect investors, if there is any related company transactions between the Company or the subsidiary company and the affiliate company, and the related parties in the future, these transactions must be considered by the Board of Directors, which has the Audit Committee giving the opinion for the necessity and the appropriateness of the transactions. Directors who have an interest in said transactions have no rights to vote on such matters. In the event that the Audit Committee doesn’t have an expertise in the matter of such transactions, the Company will provide an independent expert or the Company’s auditor to provide an opinion as to the necessity, reasons and decision by the Board of Directors or shareholders in making the transactions, as the case may be. The Company will also disclose the transactions in the notes of the Company’s audited financial statement. The Audit Committee’s opinion The Audit Committee has considered the past and recently related company transactions of the Company, the subsidiary companies or the related parties and has the opinion that the Company has disclosed the information correctly and completely. Such transactions were under the normal business conditions with either the market price or close to the market price.


AUDIT COMMITTEE REPORT

2009 has been a year of recovery for Cal-Comp Electronics (Thailand) Public Company Limited amidst the global financial and economic crisis. A slow but gradual recovery in the United State and Europe benefited the three product lines for the company. The Audit Committee of Cal-Comp continues to support management and Board of Directors to achieve its revenue, cost cutting, production efficiency, corporate and social responsibility, amongst its various goals in 2009. The Audit Committee had a total of six meetings in 2009 as well as meetings and consultation with management, internal auditors, external auditors, and supply chain of the company. The Audit Committee has three independent directors consisting of: 1. Alan Kam Chairman & Independent Director 2. William Hang Man Chao Independent Director 3. Vichai Jittawait Independent Director In 2009, the Audit Committee performed the following duties: Financial Statement - The Audit Committee reviewed quarterly and annual financial statements along with senior management and external auditors of the company. The Committee also reviewed financial statement on its subsidiaries and affiliates prior to every board meeting. The Committee is satisfied that financial presentation is accurate and they are in conformity with the Stock Exchange of Thailand and the Thailand Security Exchange Commission Policy and Principal. Internal Audit - The Audit Committee regularly reviewed and endorsed the audit plan of the internal audit department. The Committee also assessed the internal auditors’ scope of work and reviewed audit findings. The Committee is satisfied with the work of the internal audit department and continues to maintain a dialogue with the internal auditors throughout the year. External Auditors - During the course of the year, the Committee met with the company’s external auditors, Ernst and Young. Discussion concentrated on subject matters such as the external auditors’ audit plan, the semi-annual review statement and the yearend audit as well as the auditor’s management letter. In preparation for conversion to IFRS, Audit Committee also consulted Ernst and Young on the readiness of Cal-Comp to convert in the year 2013. The Audit Committee is happy to report that senior management of Cal-Comp and Ernst and Young have had both high level and middle management discussion on this matter throughout the year and they are working toward the conversion date. Risk Management - Given the global economic crisis, the Audit Committee, has reviewed the effectiveness of Cal-Comp’s risk management capability. Discussions were held with senior management to assure that there are sufficient safeguard and control in the area of risk management, compliances, capital budgeting, company’s hedging policy, and material control. Related Party Transactions - The Audit Committee has reviewed the disclosure of connected party transaction of Cal-Comp and its subsidiaries and affiliates. It is satisfied that such transactions are reasonable in the normal course of business. Corporate Governance - For the past 20 years, the company has put tremendous emphasis on corporate social responsibility. Aside from proper handling of waste management, energy savings, and pollution control, the company continues to contribute to the community where it factories are located. The company provides continuing education and training to its staffs and donates to school programs. As usual, Audit Committee members paid visits to the company’s factories in Petchburi, Mahachai as well as its four factories in Suzhou in China. The Committee met with senior management of the factories and their supply chain. The Committee is satisfied that all parties are vigilant in maintaining an efficient production process, inventory control, financial planning, and logistic in the past year. The Audit Committee is happy to report that senior management has worked hard to maintain its leadership position in all three of its product group. We wish to thank management, internal audit staffs, investment relationship department, and external auditors for their supports in the past year.

Alan Kam Chairman of The Audit Committee

Independent Director


INTERNAL CONTROL

The Board of Directors perceives that the internal control system of the Company and its subsidiaries is enough to retain the assets of the Company and its subsidiaries, concerning that the internal information will not be used on the executive’s own benefits. Through the past, there was no flaw in the internal control system used. 1. Organization and environment The Company set the clear achievable and measurable goals, revised the operational goals, considered the possibility of the goal set along, and analyzed the reasonableness of incentives and employee compensation. The operation policy and procedures were written as a document precisely and able to prevent the dishonesty. 2. Risk management The important risk factors assessed by the Company are such as exchange rate risk, risk of reliance on a major customer, risk of working capital shortage. The Company specified the standard to follow the events perceived as the causes of risk. The following strategy will be applied every month to closely monitor the performance. 3. Management Control The Company clearly set the limits on authorities and authorities on cash approval of the executives in each level and the rules were written as a document such as the authorities of managing director specified in item 9, management. 4. Information Technology and Communication System The Company provided enough significant information to the Board of Directors, and also submitted an invitation letter or necessary document for the meeting for consideration prior to the meeting. The directors’ meeting reports were recorded, and if there is any dispute on the resolution against the majority, the directors’ opinion memos will be recorded as well. The document for accounting records were arranged and kept properly and there was no report of faults from the Auditor in the document arrangement. 5. Follow-up system If the operating results of the Company are different from the target goals, the Company will solve them within an appropriate period of time and will provide the investigation on operation, which is conformable to the internal control system. In this regard, the Audit Committee of the Company will observe on any difference every quarter of each year. The Company has arranged the quarterly Audit Committee Meeting to approve the financial statements, internal audit control and related party transaction. The latest meeting was held on February 10, 2010, approved the financial statement, internal audit control and connected transaction for year 2009. The Audit Committee had considered that the internal audit control of the Company is on standard and the related party transactions is reasonable, the conditions were in line with the normal business practice and the price of the transaction was close to the market price.


DIRECTORS’ REPORTING

The Board of Directors is responsible for the accuracy and completeness of the Company and its subsidiary’s financial statements. Accounting principles used and financial statements are in compliance with accounting standards and disclosed. In order to ensure the effectiveness internal control and audit system, the Audit Committee will regularly review the financial statement and internal control system. The Audit Committee report had already disclosed in annual report. The Audit committee had clarified on internal audit with good management that can be confident for the financial statement of the Company and its subsidiaries as of 31 December 2009.

Mr. Hsu, Sheng-Hsiung Chairman


Mr. Chou, Kung-Hsiung Managing Director


SOCIAL AND ENVIRONMENT RESPONSIBILITIES

The Company believes its environment, safety and pollution management practices should be complied with regulations. CCET is committed to prevent pollution, efficiently use the resources and improve employee safety. CCET realizes our success not only on operation results but also the responsibility to society and environment. Therefore, the Company determined to continue further contribution in year 2009 as the following: Social and Education 1. The Company had donated to The Royal King RamaII Foundation for Baht 100,000 to support the public welfare

program. 2. The Company realizes the importance of green environment and joined the Green Project by Custom Department to

protect the mangrove forest, a natural resources and the living of sea life. On June 27, 2009, the Company’s employees have participated with the Customs Department to afforest at the coast near Samutsongkhram. The objective is designed to promote participation of private and Government sectors to create conscious and values in nature conservation and environmental benefits which will cause the expansion of cultivation and conservation of aquatic federations in various coastal areas. In addition, the Company has also donated Baht 200,000 for supporting all the relevant activities in this project.

3. On the 20th anniversary, the Company had sponsored scholarship program to underprivileged students through the

provincial governor in both Phetchaburi and Samutsakhon Province for Baht 200,000 each. Donation is allocated to students based on governors’ decision.

Development potential of Humanity The Company has launched a new project for developing Skill, Technology & Innovation (“STI”), that has been supported by The Board of Investment of Thailand (“BOI”) and it will be starting from 2008 to 2014. The budget of this project is approximately Baht 150 million and there are 3 projects under this master plan, the details of each project summarize as the following:

1st Project The Company has established a Research and Development Center for designing computer peripheral products in Thailand to upgrade local Engineer’s capability on to international standard, and to produce better quality of the products and to meet the demand of the market.


2nd Project The Company has coordinated with the education institutes such as King Mongkut’s Institute of Technology Ladkrabang, Mahanakorn University of Technology, and NECTEC for the research on the Electronics and New Technology project. The project aims at supporting institute for proper technology and equipment development in order to enhance local engineer’s professional knowledge as well as improvement in production efficiency In addition, the Company offers scholarships to aforementioned institutes in the department of engineering in Bachelor and Master Degree to support potential local students who are enthusiasm in the said field.

3rd Project The Company has cooperated with institute and organized High Technology Training Program to assist local engineers the opportunity to train and to practice in the said field overseas. Such program aims to provide potential students with global learning environment. Environment Regarding the environment, the Company realizes the importance of the environment and the responsibility for the environment and the effect of the environment that may harm the neighbor and the employees. The Company has the Environmental Policy as: We, Cal-Comp, commit to the worldwide environmental policy, which state “The environment protection is the responsibility of human being” and everyday at Cal-Comp is the worldwide environment day. Moreover, we have the additional policy as following: 1. Correcting and preventing the pollution, as well as, decreasing, treating and monitoring the waste of factories as

state period time to conform to the legal and regulation are our commitment. 2. Energy saving is the must by recycle and energy consumable reduction to prevent the pollution. 3. Awareness training and environment knowledge training are given to the employees for efficient protection of

environment. 4. Monitoring and improving the energy consumption continuously to optimize the benefit from energy is our mission

of energy guard ness. 5. Eliminate and reduce the hazard materials to environment as customer requirement is our commitment. The above environment policy is our commitment and also the awareness throughout the Company by using several methods to achieve our policy and company’s mission. The Company has been committing to the policy and also training the employees to ensure the understanding and practical to commit of this policy. The Company also appointed the environment committee to take responsibility in control, look after and service. Their responsibilities are as follow: 1. Establish the environment policy 2. Environment evaluation 3. Review environment evaluation result 4. Legal and other requirement selection 5. Establish the environment programs 6. Establish objectives and targets


7. Effectiveness of environment communication 8. Review environment management system The committee set up the crucial point in environment management as: £On behave of Environment committee; all relevant functions must identify the aspect of air, wastewater and garbage to conforming to legal and regulation impacting to the interest parties before developing the environment system. £Every function shall report the environment evaluation result for all aspects. £Environment committee shall implement the risk assessment results from the past, present and future. £The priority of correction shall prioritize as per the impact results from the risk assessment, as well as, the cost control and technique control. £The advanced planning for the compliance activities and maintained when to implementing these activities. All aspect shall be reviewed every 4 months. The Company also realizes the importance in communication about the environment to customers, employees, suppliers and relevant persons to inform the change of the rules and regulations. Moreover, the Company also has the environment training for the employees to work effectively and smoothly. The Company also has the evaluation for the effect of the environment by dividing every work in the factory to build the standard in control the trend that can harm the environment, checking the quality of the environment such as water, air, and sound according to the laws, arranging the emergency plan and also have the training to reduce the environmental harm. The Company also coordinates with the government to reduce the environmental effect by the Company received ISO 14001 certification from AFAQ & Bestcert (Thailand) Co., Ltd., France which result from the successful in implementing the ISO 14001 standard for Environmental Management System (EMS) at both Mahachai and Petchaburi plants. Remuneration for Auditor 1. Audit fee For year 2009, the Company has paid the audit fee of 3,170,000 Baht to Ernst & Young Office Limited, Certified Public Accountant No.3516 Ms. Rungnapa Lertsuwankul. The Audit fee for the period of year 2009 had been approved by the shareholder meeting, the remuneration of not exceeding Baht 3,170,000 per annum. 2. Other fee - None -


MANAGEMENT DISCUSSION AND ANALYSIS

Financial Statement Summary (Unit : MB)

Audited Audited

Items 2008 2009

Amount % Amount %

Assets Cash and cash equivalents 2,083.19 3.50 2,666.02 5.72 Short-term investments 1,525.04 2.56 969.55 2.08 Trade accounts receivable, net 31,016.64 52.14 22,848.15 49.03 Trade accounts receivable - related parties, net 2,844.07 4.78 828.09 1.78 Short-term loans to related party 147.85 0.25 71.22 0.15 Inventories, net 9,674.79 16.26 8,232.26 17.66 Other current assets 2,908.68 4.89 1,903.42 4.08

Total current assets 50,200.26 84.38 37,518.71 80.50

Property, plant and equipment, net 8,184.15 13.76 7,797.28 16.73 Investments 69.90 0.12 65.58 0.14 Other non-current assets 1,033.68 1.74 1,223.21 2.63

Total non-current assets 9,287.73 15.62 9,086.07 19.50

Total Assets 59,487.99 100.00 46,604.78 100.00

Liabilities and Shareholders’ Equity Short-term loans from financial institutions 14,232.22 23.92 8,803.88 18.89 Total trade accounts payable 28,043.80 47.14 18,787.95 40.31 Current portion of Long-term loans 400.94 0.67 - - Advance from and amount due to related parties 3.60 0.01 0.89 0.00 Other current liabilities 1,896.17 3.19 3,075.24 6.60

Total current liabilities 44,576.73 74.93 30,667.96 65.80

Total Liabilities 44,576.73 74.93 30,667.96 65.80

Shareholders’ Equity Issued and paid-up share capital 3,930.92 6.61 3,941.11 8.46 Additional paid-in capital 2,988.16 5.02 3,144.54 6.75 Currency translation differences 57.52 0.10 (187.75) (0.40) Retained earnings 7,934.66 13.34 9,038.92 19.39

Total Shareholders’ Equity 14,911.26 25.07 15,936.82 34.20

Total Liabilities and Shareholders’ Equity 59,487.99 100.00 46,604.78 100.00


Audited Audited

Items 2008 2009

Amount % Amount %

Financial Statement Summary (Continued) (Unit : MB)

Revenue Sales 123,285.41 99.62 108,437.91 99.83 Other income 473.90 0.38 182.51 0.17

Total Revenue 123,759.31 100.00 108,620.42 100.00

Expenses Cost of sales 118,952.54 96.12 104,446.55 96.16 Selling and administrative expenses 1,614.51 1.30 2,083.36 1.92 Share on sale of other long-term investment 50.00 0.04 121.25 0.11 Loss on exchange 245.65 0.20 75.90 0.07 Other expenses 45.26 0.04 68.29 0.06

Total Expenses 120,907.96 97.70 106,795.35 98.32

Earnings before interest expense and income tax 2,851.06 2.30 1,825.01 1.68 Financial Cost 576.83 0.47 355.32 0.33 Corporate income tax 146.44 0.12 168.38 0.16

Net earnings (loss) 2,127.78 1.72 1,301.31 1.20

Basic net earnings (loss) per share (Baht) 0.54 0.33 Weighted average number of ordinary shares (million shares) 3,930 3,941

Fully diluted net earnings (loss) per share (Baht) 0.53 0.32

Net cash from (used in) operating activities (921.34) 6,986.37 Net cash from (used in) investing activities (1,295.77) (631.49) Net cash from (used in) financing activities 3,818.51 (6,307.34) Net increase (decrease) in cash and cash equivalents 1,534.27 27.35


Financial Ratios

Items 2008 2009

1. Liquidity ratio Current ratio (times) 1.13 1.22 Quick ratio (times) 0.91 0.95 Account receivable turnover (times) 4.25 3.77 Days receivable (days) 84.77 95.51 Inventory turnover (times) 13.34 11.67 Average selling period (days) 26.99 30.86 Account payable turnover (times) 5.06 4.46 Days payable (days) 71.18 80.71 Cash Cycle (days) 40.58 45.66

2. Profitability ratio Gross profit margin (%) 3.51 3.68 Operating profit margin (%) 2.20 1.76 Net profit margin (%) 1.72 1.20 Return on equity (%) 14.75 8.44

3. Efficiency ratio Return on assets (%) 4.10 2.45 Return on fixed assets (%) 38.44 43.35 Asset turnover (times) 2.37 2.04

4. Financial ratio Debt to equity ratio (times) 2.99 1.92 Interest coverage ratio (times) 3.90 4.10 Dividend payout ratio (%) 31.74 32.44

5. Per share data Book value per share (Baht) 3.79 4.04


Analysis of Performance

Overall past performance In 2009, the Company’s sale has decreased by 12.04% compared to 2008 due to the impact of financial crisis, the decrease in global demand and personnel income. Even in the 2H09, the economic showed sign of gradually recovered but the spending is still remained conservative. Moreover, the electronics market is highly competitive, so will affect to the business margin. The summary of the performance of year 2008 and 2009 are as follows:

1. Total revenue The Company’s sale revenue in 2008 was Baht 123,285.41 million, in year 2009, the Company generated total revenue of Baht 108,437.91 million, an decrease of Baht 14,847.50 million or 12.04% from the previous year as a result of a decreased sale of computer peripheral for 11.96% and telecom products for 11.53% from both Thailand and China Plants.

2. Cost of sales In 2008 and 2009, the Company had cost of sales of Baht 118,952.54 million, and 104,446.55 million, respectively, which were equivalent to 96.49% and 96.32% of sale revenue, respectively. The Company’s gross profit margin slightly improved due to the decrease and stability in the material cost.

3. Selling and administrative expenses (SG&A) For 2008 and 2009, the Company had SG&A of Baht 1,614.51 million or 1.31% of sale revenue and 2,083.36 million or 1.92% of sale revenue, respectively. The increase of SG&A is result of continuously investment in R&D capability and increased employment.

4. Profit The Company had operating profit margin of 2.20% and 1.76% in 2008-2009, respectively. The operating profit margin decreased in 2009 came from the increase of R&D expenses as mentioned. During 2008 and 2009, the Company had net profit margin of Baht 2,127.78 million and Baht 1,301.31 million, a 38.84% dropped. The Company’s net profit margin decreased from 1.72% in year 2008 to 1.20% in year 2009. The decrease of net profit in 2009 was result of the intense competition in the electronics manufacturing market, the slowdown of the world economy and also the changes in product mix contribution which overall caused our margin drop as compared to last year. Analysis of Financial Status

Assets As of 31 December 2009, the Company had total assets of Baht 46,604.78 million, a decrease of Baht 12,883.21 million or 21.66% from Baht 59,487.99 million as of 31 December 2008. This was mainly due to the decrease in current assets for 25.26%.

1. Current assets As at 31 December 2009, total current assets were Baht 37,518.71 million, or equivalent to 80.50% of total assets, decreasing 25.26% compared to 2008. The main reasons are the decrease of trade account receivable for Baht 8,168.49 million or 26.34% and trade account receivable from related parties Baht 2,015.98 million or 70.88% respectively, as well as the decrease of other current assets for Baht 1,005.26 or 34.56%.


1.1. Trade accounts receivable As of 31 December 2008 and 2009, the Company had the net trade accounts receivable of Baht 31,016.64 million and 22,848.15 million, respectively. The decreased of 26.34% was due to the decrease of sale revenue for 12.04% compared to 2008 as well as our value customers have been paying payments on schedule. The not yet due accounts receivable represented 89.91% of total trade accounts receivable which is higher than 77.32% of year 2008. 1.2 Inventory - net As of 31 December 2009, the Company had net inventory of Baht 8,232.26 million, a decrease of 14.91% from Baht 9,674.79 million as of 31 December 2008. As of 31 December 2008 and 2009, the raw materials were Baht 8,617.35 million and 7,369.58 million, respectively, a decrease of 14.48% from 2008. Major portion in the inventory sector is raw material which accounted 89.52% of the inventory and is considered reasonable proportion following CCET’s inventory policy. The Company has to store sufficient raw materials to ensure the production as customers’ schedule because most of raw materials will come from aboard and require 45-60 days for delivery after the purchase orders.

2. Non-current assets As at 31 December 2008 and 2009, the Company had total non-current assets of Baht 9,287.73 million and 9,086.07 million, respectively. The 2009 figure represents 19.50% of total assets and a decrease of 2.17% over 2008. Source of capital

Liabilities As of 31 December 2009, the Company had total liabilities Baht 30,667.96 million, a decrease of 31.20% from Baht 44,576.73 million in 2008. In 2009, the Company paid long-term loan of Baht 400.94 million as well as decreased in short term loan of 38.14% compared to 2008. Due to the efficiency in cash management and on time payment from valued customers, therefore, the Company had reduced loan portion. However, for future business preparation and strengthen the financial status, the Company has launched new syndication loan in amount USD 120 million and expected to drawdown in 2010 onward. The debt to equity ratios in 2009 was 1.92 times, a decrease from 2.99 times in 2008.

Equity As at 31 December 2008 and 2009, the Company had total equity of Baht 14,911.26 million and 15,936.82 million, respectively. The increased Baht 1,025.56 million was came from the increase of retained earning of Baht 1,104.26 million which therefore result a 13.92% increased YoY.


REPORT OF INDEPENDENT AUDITOR

To the Shareholders of Cal-Comp Electronics (Thailand) Public Company Limited I have audited the accompanying consolidated balance sheets of Cal-Comp Electronics (Thailand) Public Company Limited and its subsidiaries as at 31 December 2009 and 2008, the related consolidated statements of income, changes in shareholders’ equity and cash flows for the years then ended, and the separate financial statements of Cal-Comp Electronics (Thailand) Public Company Limited for the same years. These financial statements are the responsibility of the management of the Company and its subsidiaries as to their correctness and the completeness of the presentation. My responsibility is to express an opinion on these financial statements based on my audits. I did not audit the financial statements of overseas subsidiaries as discussed in Note 2.2 to the financial statements, and which are included in the consolidated financial statements for the year ended 31 December 2009 and 2008. These subsidiaries’ financial statements show total assets as at 31 December 2009 and 2008 of Baht 25,862 million and Baht 37,450 million, respectively, and total revenues for the years then ended totalling Baht 63,075 million and Baht 84,170 million, respectively. The financial statements of the subsidiaries were audited by other auditors, whose reports have been furnished to me, and my opinion, insofar as it relates to the amounts included for those subsidiaries in the consolidated financial statements, is based solely on the reports of the other auditors. I conducted my audits in accordance with generally accepted auditing standards. Those standards require that I plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. I believe that my audits, together with the report of other auditors discussed in the first paragraph, provide a reasonable basis for my opinion. In my opinion, based on my audits and the audit reports of other auditors, the financial statements referred to above present fairly, in all material respects, the financial position of Cal-Comp Electronics (Thailand) Public Company Limited and its subsidiaries and of Cal-Comp Electronics (Thailand) Public Company Limited as at 31 December 2009 and 2008, and the results of their operations and cash flows for the years then ended in accordance with generally accepted accounting principles. Without qualifying my opinion on the above financial statements, I draw attention to the Note 7 to the financial statements. The Company has substantial product sales and raw material purchase transactions in the financial statements with its subsidiaries and related companies.

Rungnapa Lertsuwankul Certified Public Accountant (Thailand) No. 3516

Ernst & Young Office Limited Bangkok : 8 February 2010


BALANCE SHEETS

Assets

Current assets

Cash and cash equivalents 2,666,021,791 2,083,185,133 517,853,172 433,933,480

Current investments

Term deposits at financial institutions 969,550,785 1,525,040,750 720,001,000 592,501,000

Trade accounts receivable 23,003,447,537 31,112,832,211 10,761,056,622 9,238,235,293

Less: Allowance for doubtful accounts (155,298,401) (96,192,884) (42,569,446) (43,777,528)

Trade accounts receivable, net 6 22,848,149,136 31,016,639,327 10,718,487,176 9,194,457,765

Trade accounts receivable - related parties 828,101,688 2,844,606,134 1,837,391,503 9,231,274,071

Less: Allowance for doubtful accounts (7,606) (534,961) (7,606) (534,961)

Trade accounts receivable - related parties, net 6, 7 828,094,082 2,844,071,173 1,837,383,897 9,230,739,110

Short-term loans to related parties - net 7 71,224,436 147,848,369 - -

Amount due from related parties, net 7 11,984,887 233,309,597 6,463,020 242,689,661

Inventories, net 8 8,232,260,966 9,674,791,789 4,040,702,555 4,355,853,022

Goods in transit 478,468,830 658,720,971 469,499,310 203,960,728

Advances payment for raw materials, net 9 382,812,537 474,027,745 109,117,889 278,514,634

Other receivables, net 10 200,173,833 181,224,127 191,660,274 142,243,039

Other current assets 11 829,972,240 1,361,398,394 51,706,265 139,701,069

Total current assets 37,518,713,523 50,200,257,375 18,662,874,558 24,814,593,508

Non-current assets

Investments in subsidiaries, net 12 - - 3,778,645,580 2,567,259,580

Investments in associates, net 13 11,944,878 13,086,034 - -

Other long-term investments, net 14 53,630,991 56,813,877 3,645,000 4,490,331

Advance for share acquisition 12 - - - 354,300,000

Property, plant and equipment, net 15 7,797,280,862 8,184,145,751 3,682,793,833 3,532,135,051

Intangible assets, net 16 424,169,902 513,796,127 - -

Other non-current assets 17

Land occupancy rights, net 84,396,770 90,010,053 - -

Molds and spare parts 217,308,067 199,443,456 197,671,905 183,268,818

Others 497,332,493 230,438,387 969,927 928,927

Total non-current assets 9,086,063,963 9,287,733,685 7,663,726,245 6,642,382,707

Total assets 46,604,777,486 59,487,991,060 26,326,600,803 31,456,976,215

(Unit : Baht)

Consolidated Separate financial statements financial statements Note 2009 2008 2009 2008

Cal-Comp Electronics (Thailand) Public Company Limited and its subsidiaries As at 31 December 2009 and 2008

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


Liabilities and shareholders' equity

Current liabilities

Short-term loans from financial institutions 18 8,803,879,174 14,232,224,143 923,173,918 5,101,247,595

Trade accounts payable

Related parties 7 21,566,246 5,671,171,853 418,415,214 787,062,160

Others 18,766,381,168 22,372,628,698 10,136,546,445 12,152,835,913

Total trade accounts payable 18,787,947,414 28,043,800,551 10,554,961,659 12,939,898,073

Current portion of long-term loans 21 - 400,941,714 - 400,941,714

Advance from and amount due to related parties 7 894,064 3,602,064 267,229,964 13,711,988

Other current liabilities

Corporate income tax payable 63,506,267 57,374,028 4,101,440 3,098,560

Accrued interest expense 42,712,458 26,861,847 224,597 4,396,588

Accrued expenses 1,446,175,804 646,052,717 146,157,547 141,925,205

Other payable 19 1,184,550,156 790,366,066 331,359,465 175,519,543

Others 20 338,291,750 375,509,452 171,648,602 54,290,132

Total current liabilities 30,667,957,087 44,576,732,582 12,398,857,192 18,835,029,398

Shareholders' equity

Share capital 22

Registered

4,786,168,001 ordinary shares of Baht 1 each 4,786,168,001 4,786,168,001 4,786,168,001 4,786,168,001

Issued and paid up share capital

3,941,108,792 ordinary shares of Baht 1 each

(2008: 3,930,923,139 ordinary shares of Baht 1 each) 3,941,108,792 3,930,923,139 3,941,108,792 3,930,923,139

Share premium 22 3,144,543,957 3,108,560,539 3,144,543,957 3,108,560,539

Unrealised loss

Revaluation deficit on changes in value of investments - (120,401,604) - (120,401,604)

Translation adjustment (187,751,038) 57,519,015 - -

Retained earnings

Appropriated - statutory reserve 24 511,111,587 511,111,587 511,111,587 511,111,587

Unappropriated 8,527,807,101 7,423,545,802 6,330,979,275 5,191,753,156

Total shareholders' equity 15,936,820,399 14,911,258,478 13,927,743,611 12,621,946,817

Total liabilities and shareholders' equity 46,604,777,486 59,487,991,060 26,326,600,803 31,456,976,215


BALANCE SHEETS (CONTINUED)

(Unit : Baht)

Cal-Comp Electronics (Thailand) Public Company Limited and its subsidiaries As at 31 December 2009 and 2008



Revenues

Sales 7 108,437,914,397 123,285,411,620 60,207,092,237 67,392,551,936

Gain on sales of property, plant and equipment 15 48,287,023 242,212,575 51,672,223 -

Exchange gain 26 - - 188,842,014 -

Other income 134,220,303 231,689,317 26,680,455 106,306,390

Total revenues 108,620,421,723 123,759,313,512 60,474,286,929 67,498,858,326

Expenses

Cost of sales 7 104,446,547,048 118,952,536,903 58,575,819,851 64,208,412,595

Selling expenses 126,921,860 141,488,658 33,229,051 53,959,440

Administrative expenses 1,956,437,969 1,473,019,194 225,722,362 109,821,009

Management benefit expenses 21,072,371 20,268,929 21,072,371 20,268,929

Impairment loss of investment in subsidiary 12 - - - 300,000,000

Impairment loss of other long-term investment 14 121,246,935 50,000,000 121,246,935 50,000,000

Impairment loss of assets 23,333,211 - 23,333,211 -

Exchange loss 26 75,903,702 245,648,470 - 68,824,262

Other expenses 23,887,289 24,994,972 8,195,759 632,970

Total expenses 106,795,350,385 120,907,957,126 59,008,619,540 64,811,919,205

Income before share of loss from

investment in associated 1,825,071,338 2,851,356,386 1,465,667,389 2,686,939,121

Share of loss from investments in associates (63,668) (299,914) - -

Income before finance cost and

corporate income tax 1,825,007,670 2,851,056,472 1,465,667,389 2,686,939,121

Finance cost (355,319,749) (576,832,584) (124,769,203) (210,765,881)

Income before corporate income tax 1,469,687,921 2,274,223,888 1,340,898,186 2,476,173,240

Corporate income tax 4.14, 27 (168,379,082) (146,444,488) (4,624,527) (6,083,891)

Net income for the year 1,301,308,839 2,127,779,400 1,336,273,659 2,470,089,349

Earnings per share 28

Basic earnings per share

Net income 0.33 0.54 0.34 0.63

Diluted earnings per share

Net income 0.32 0.53 0.33 0.61


INCOME STATEMENTS

(Unit : Baht)

Cal-Comp Electronics (Thailand) Public Company Limited and its subsidiaries For the years ended 31 December 2009 and 2008



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,015

51

1,11

1,58

7 7,

423,

545,

802

14,9

11,2

58,4

78

- 14

,911

,258

,478

Bala

nce

as a

t 1

Janu

ary

2009

3,

930,

923,

139

3,10

8,56

0,53

9 (1

20,4

01,6

04)

57,5

19,0

15

511,

111,

587

7,42

3,54

5,80

2 14

,911

,258

,478

-

14,9

11,2

58,4

78

Inco

me

and

expe

nses

rec

ogni

sed

dire

ctly

in e

quity

:

Othe

r lon

g-term

inve

stm

ent

Loss

reco

gnise

d in

shareh

olders'

equit

y -

- (845

,331

) -

- -

(845

,331

) -

(845

,331

)

Tran

sferred

to in

com

e statem

ent o

n im

pairm

ent (

Note 1

4)

- -

121,24

6,93

5 -

- -

121,24

6,93

5 -

121,24

6,93

5

Tran

slatio

n ad

justm

ent

- -

- (245

,270

,053

) -

- (245

,270

,053

) -

(245

,270

,053

)

Net

inco

me

and

expe

nses

rec

ogni

sed

dire

ctly

in e

quity

-

- 12

0,40

1,60

4 (2

45,2

70,0

53)

- -

(124

,868

,449

) -

(124

,868

,449

) Ne

t inc

ome

for t

he y

ear

- -

- -

- 1,30

1,30

8,83

9 1,30

1,30

8,83

9 -

1,30

1,30

8,83

9

Tota

l inc

ome

and

expe

nses

for

the

year

-

- 12

0,40

1,60

4 (2

45,2

70,0

53)

- 1,

301,

308,

839

1,17

6,44

0,39

0 -

1,17

6,44

0,39

0

Divid

ends

paid

(Note

31)

- -

- -

- (197

,047

,540

) (197

,047

,540

) -

(197

,047

,540

) Ca

pital

increas

ed d

ue to

con

vert

warrants

to s

hares

(Note

22)

10,185

,653

35

,983

,418

-

- -

- 46

,169

,071

-

46,169

,071

Bala

nce

as a

t 31

Dec

embe

r 20

09

3,94

1,10

8,79

2 3,

144,

543,

957

- (1

87,7

51,0

38)

511,

111,

587

8,52

7,80

7,10

1 15

,936

,820

,399

-

15,9

36,8

20,3

99

STAT

EMEN

TS O

F CH

ANG

ES IN

SH

AREH

OLD

ERS’

EQ

UIT

Y

(Unit

: Ba

ht)

Cal-C

omp

Elec

tron

ics

(Tha

iland

) Pub

lic C

ompa

ny L

imite

d an

d its

sub

sidi

arie

s Fo

r th

e ye

ars

ende

d 31

Dec

embe

r 20

09 a

nd 2

008


Se

para

te fi

nanc

ial s

tate

men

ts

Re

valu

atio

n

Issu

ed a

nd

de

ficit

on

Reta

ined

ear

ning

s

pa

id-u

p

chan

ges

in v

alue

sh

are

capi

tal

Shar

e pr

emiu

m

of in

vest

men

ts

App

ropr

iate

d U

napp

ropr

iate

d To

tal

Bala

nce

as a

t 1

Janu

ary

2008

3

,919

,208

,416

3,

105,

501,

624

(166

,688

,531

) 51

1,11

1,58

7 4,

289,

488,

721

11,6

58,6

21,8

17

Inco

me

and

expe

nses

rec

ogni

sed

dire

ctly

in e

quity

:

Othe

r lon

g-term

inve

stm

ent

Lo

ss re

cogn

ised

in sh

areh

olders'

equit

y -

- (3,713

,073

) -

- (3,713

,073

)

Tran

sferred

to in

com

e statem

ent o

n im

pairm

ent (

Note 1

4)

- -

50,000

,000

-

- 50

,000

,000

Net

inco

me

reco

gnis

ed d

irect

ly in

equ

ity

- -

46,286

,927

-

- 46

,286

,927

Ne

t inc

ome

for t

he y

ear

- -

- -

2,47

0,08

9,34

9 2,47

0,08

9,34

9

Tota

l inc

ome

for

the

year

-

- 46

,286

,927

-

2,47

0,08

9,34

9 2,51

6,37

6,27

6 Di

viden

ds p

aid (N

ote

31)

- -

- -

(1,567

,824

,914

) (1,567

,824

,914

)

Capit

al inc

reas

ed d

ue to

con

vert

warrants

to s

hares

(Note

22)

11,71

4,72

3 3,05

8,91

5 -

- -

14,773

,638

Bala

nce

as a

t 31

Dec

embe

r 20

08

3,930

,923

,139

3,10

8,56

0,53

9 (120

,401

,604

) 51

1,11

1,58

7 5,19

1,75

3,15

6 12

,621

,946

,817

Bala

nce

as a

t 1

Janu

ary

2009

3

,930

,923

,139

3,10

8,56

0,53

9 (120

,401

,604

) 51

1,11

1,58

7 5,19

1,75

3,15

6 12

,621

,946

,817

In

com

e an

d ex

pens

es r

ecog

nise

d di

rect

ly in

equ

ity:

Ot

her l

ong-term

inve

stm

ent

Lo

ss re

cogn

ised

in sh

areh

olders'

equit

y -

- (845

,331

) -

- (845

,331

)

Tran

sferred

to in

com

e statem

ent o

n im

pairm

ent (

Note 1

4)

- -

121,24

6,93

5 -

- 12

1,24

6,93

5

Net

inco

me

reco

gnis

ed d

irect

ly in

equ

ity

- -

120,40

1,60

4 -

- 12

0,40

1,60

4 Ne

t inc

ome

for t

he y

ear

- -

- -

1,33

6,27

3,65

9 1,33

6,27

3,65

9

Tota

l inc

ome

for

the

year

-

- 12

0,40

1,60

4 -

1,33

6,27

3,65

9 1,45

6,67

5,26

3 Di

viden

ds p

aid (N

ote

31)

- -

- -

(197

,047

,540

) (197

,047

,540

)

Capit

al inc

reas

ed d

ue to

con

vert

warrants

to s

hares

(Note

22)

10,18

5,65

3 35

,983

,418

-

- -

46,169

,071

Bala

nce

as a

t 31

Dec

embe

r 20

09

3,941

,108

,792

3,14

4,54

3,95

7 -

511,11

1,58

7 6,33

0,97

9,27

5 13

,927

,743

,611

The

acco

mpa

nying

notes

are a

n int

egral p

art o

f the

fina

ncial

statem

ents.

STAT

EMEN

TS O

F CH

ANG

ES IN

SH

AREH

OLD

ERS’

EQ

UIT

Y (C

ON

TIN

UED

)

(Unit

: Ba

ht)

Cal-C

omp

Elec

tron

ics

(Tha

iland

) Pub

lic C

ompa

ny L

imite

d an

d its

sub

sidi

arie

s Fo

r th

e ye

ars

ende

d 31

Dec

embe

r 20

09 a

nd 2

008


Cash flows from operating activities Net income before tax 1,469,687,921 2,274,223,888 1,340,898,186 2,476,173,240 Adjustments to reconcile net income before tax to net cash provided by (paid from) operating activities Depreciation and amortisation 2,078,784,632 1,017,799,128 543,377,142 508,802,591 Allowance for doubtful accounts 219,900,450 18,605,912 89,900,450 870,758 Gain on disposal of property, plant and equipment (48,287,023) (246,409,982) (51,672,223) (13,556,246) Loss (gain) on disposal of mold and tooling 32,906,472 (3,809,621) 32,906,472 (3,809,621) Impairment loss of assets 23,333,211 - 23,333,211 - Share of loss from investments in associates 63,668 299,914 - - Loss on disposal of other long-term investment - 385,746 - - Allowance for impairment loss in investment in subsidiary - - - 300,000,000 Allowance for impairment loss of other long-term investment 121,246,935 50,000,000 121,246,935 50,000,000 Allowance for diminution in value of inventories (Reverse) 110,468,971 (152,663,036) (1,494,591) (137,049,536) Unrealised loss on exchange 109,800,004 46,630,805 81,583,174 91,544,306 Interest income (14,588,484) (9,048,857) (3,352,272) (6,941,083) Interest expense 335,908,440 559,178,833 112,419,513 199,709,390

Income from operating activities before changes in operating assets and liabilities 4,439,225,197 3,555,192,730 2,289,145,997 3,465,743,799 Operating assets (increase) decrease Trade accounts receivable 8,059,055,012 (8,344,851,270) (1,573,150,991) (3,005,075,130) Trade accounts receivable - related parties 2,005,977,012 (1,759,396,257) 7,383,355,134 (894,997,700) Amount due from related parties 188,930,092 (147,839,740) 236,133,882 (166,739,675) Inventories 1,332,024,726 (1,379,071,013) 316,645,058 145,878,632 Goods in transit 178,853,690 (458,309,877) (266,937,033) (3,549,635) Advances payment for raw materials 64,095,908 (82,228,797) 142,277,443 (32,448,309) Other receivables (87,935,688) (129,392,979) (118,403,217) (90,411,891) Other current assets (414,538,665) 430,841,944 86,752,218 108,586,646 Operating liabilities increase (decrease) Trade accounts payable (4,121,399,276) 4,890,167,469 (2,455,106,648) 2,015,286,309 Trade accounts payable - related parties (5,651,040,963) 3,488,150,811 (380,387,978) (321,258,247) Advance from and amount due to related parties (2,708,000) (651,359) 253,517,976 (1,209,683) Accrued expenses 799,609,338 24,636,851 4,232,341 (854,164) Other payable 397,076,527 126,943,778 159,353,751 (20,015,806) Other current liabilities (38,611,386) (996,802,581) 115,964,785 (193,067,108)

Cash flows from (used in) operating activities 7,148,613,524 (782,610,290) 6,193,392,718 1,005,868,038 Cash paid for corporate income tax (162,246,843) (138,732,002) (3,621,648) (3,786,390)

Net cash from (used in) operating activities 6,986,366,681 (921,342,292) 6,189,771,070 1,002,081,648

STATEMENTS OF CASH FLOWS

(Unit : Baht)


Consolidated Separate financial statements financial statements 2009 2008 2009 2008



Cash flows from investing activities Increase in investments of subsidiary - - (857,086,000) (488,334,000) Advance for share acquisition - - - (354,300,000) Cash receipt from disposal of investment in subsidiary - 6,429,103 - - Decrease in cash as result of change in company's shareholding in subsidiary - 5,714,460 - - Increase in other long-term investments - (10,060,000) - - Increase in property, plant and equipment (673,597,499) (1,857,125,389) (327,855,596) (430,432,382) Increase in molds and spare parts (133,367,849) (69,990,278) (113,320,862) (54,117,221) Interest income 14,588,484 9,048,857 3,352,272 6,941,083 Proceeds from sales of equipment 517,850,388 916,125,506 170,061,893 19,898,351 Proceeds from sales of molds and spareparts 138,942 4,380,250 138,942 4,380,250 Increase in intangible assets (90,206,928) (32,709,875) - - Increase in other non-current assets (266,894,362) (267,584,929) (41,000) -

Net cash used in investing activities (631,488,824) (1,295,772,295) (1,124,750,351) (1,295,963,919)

Cash flows from financing activities Increase (decrease) in short-term loans from financial institutions (5,435,460,633) 6,716,314,884 (4,185,189,341) 3,617,246,455 Decrease in long-term loans (400,941,714) (793,053,209) (400,941,714) (774,514,286) Proceeds from increase in share capital 46,169,071 14,773,638 46,169,071 14,773,638 Interest expense (320,057,828) (536,695,562) (116,591,503) (198,818,696) Dividends paid (197,047,540) (1,567,824,914) (197,047,540) (1,567,824,914) Decrease in minority interest - equity attributable to minority shareholders of subsidiary - (15,008,585) - -

Net cash from (used in) financing activities (6,307,338,644) 3,818,506,252 (4,853,601,027) 1,090,862,197

Decrease in translation adjustment (20,192,520) (67,123,145) - -

Net increase in cash and cash equivalents 27,346,693 1,534,268,520 211,419,692 796,979,926 Cash and cash equivalents at beginning of year 3,608,225,883 2,073,957,363 1,026,434,480 229,454,554

Cash and cash equivalents at end of year (Note 32) 3,635,572,576 3,608,225,883 1,237,854,172 1,026,434,480

Supplemental cash flows information: - Non-cash items consist of: - Unrealised loss on change in the value of investment 845,331 3,713,073 845,331 3,713,073 Purchase of plant and equipment that has not yet been paid 500,852,690 636,232,885 442,030,848 432,963,935 Purchase intangible assets that has not yet been paid 8,342,188 52,415,625 - - Sale molds and spare parts that has not yet received - 92,369,470 - 92,369,470 Properties forclosed increase from trade accounts receivable - 45,760,752 - 45,760,752 Intangible assets increase from trade accounts receivable - related parties - 156,337,537 - -

STATEMENTS OF CASH FLOWS (CONTINUED)

(Unit : Baht)


Consolidated Separate financial statements financial statements 2009 2008 2009 2008



Nature of Country of Percentage of Total assets as at Revenues for the year Company’s name business incorporation shareholding 31 December ended 31 December

2009 2008 2009 2008 2009 2008 Percent Percent Million Million Million Million Baht Baht Baht Baht

Held by the Company

Logistar International Group company’s British Virgin 100 100 13,821 22,947 52,977 74,031

Holding Co., Ltd. and its distributor Island

subsidiaries

Cal-Comp Electronics Manufacture of The People’s 100 100 3,101 4,081 574 559

(Suzhou) Co., Ltd. electronic products Republic of China

Cal-Comp Optical Electronics Manufacture of The People’s 100 100 4,736 5,583 234 194


Cal-Comp Electronics & Purchasing material Taiwan 100 100 458 535 2 608

Communications Co., Ltd. and research and

development

Cal-Comp Technology Manufacture of The People’s 100 100 2,958 2,654 9,282 8,776


Cal-Comp Electronics and Manufacture of The People’s 100 100 788 1,650 6 2

Communications (Suzhou) electronic Republic of China

Co., Ltd. products

NOTES TO CONSOLIDATED FINANCIAL STATEMENTSCal-Comp Electronics (Thailand) Public Company Limited and its subsidiaries For the years ended 31 December 2009 and 2008

1. General information 1.1 Corporate information Cal-Comp Electronics (Thailand) Public Company Limited (“the Company”) is a public company incorporated and domiciled in

Thailand. Its major shareholder is Kinpo Electronics, Inc., which was incorporated in Taiwan. The Company is principally engaged in the manufacture of electronic products in three sectors, such as computer and computer peripheral, telecommunication equipment and automation equipment. Its registered address is 191/54, 191/57 18th Floor, CTI Tower, Rachadapisek Road, Kwang Klongtoey, Khet Klongtoey, Bangkok 10110. The Company has 4 branches in Thailand and is located at Samutsakorn, Petchaburi and Nakhonratsima.

2. Basis of preparation 2.1 The financial statements have been prepared in accordance with accounting 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 30 January 2009, issued under the Accounting Act B.E. 2543.

The financial statements in Thai language are the official statutory financial statements of the Company. The financial statements in English language have been translated from the Thai language financial statements.

The financial statements have been prepared on a historical cost basis except where otherwise disclosed in the accounting policies.

2.2 Basis of consolidation a) The consolidated financial statements include the financial statements of Cal-Comp Electronics (Thailand) Public Company

Limited (“the Company”) and the following subsidiaries (“the subsidiaries”).


The financial statements of the subsidiaries were prepared by the management of the subsidiaries and audited by their auditors overseas.

Major revenues of Logistar International Holding Co., Ltd. represents the sales of inventories, which are purchased transactions from the Company and its subsidiaries, received from the third parties.

b) Subsidiaries are fully consolidated as from the date of acquisition, being the date on which the Company obtains control, and continue to be consolidated until the date when such control ceases.

c) The financial statements of the subsidiaries are prepared for the same reporting period as the parent company, using consistent significant accounting policies.

d) The financial statements of overseas subsidiaries are translated into Thai Baht at the closing exchange rate as to assets and liabilities, and at monthly average exchange rates as to revenues and expenses. The resultant differences are shown under the caption of “Translation adjustment” in shareholders’ equity.

e) Material balances and transactions between the Company and its subsidiaries have been eliminated from the consolidated financial statements.

f) Minority interests represent the portion of net income or loss and net assets of the subsidiaries that are not held by the Company and are presented separately in the consolidated income statement and within equity in the consolidated balance sheet.

2.3 The separate financial statements, which present investments in subsidiaries and associates presented under the cost method, have been prepared solely for the benefit of the public.

3. Adoption of new accounting standards In June 2009, the Federation of Accounting Professions issued Notification No. 12/2552, assigning new numbers to Thai Accounting

Standards that match the corresponding International Accounting Standards. The numbers of Thai Accounting Standards as referred to in these financial statements reflect such change.

The Federation of Accounting Professions has issued Notification No. 86/2551 and 16/2552, mandating the use of new accounting standards, financial reporting standard and accounting treatment guidance as follows.

3.1 Accounting standards, financial reporting standard and accounting treatment guidance which are effective for the current year

Framework for the Preparation and Presentation of Financial Statements (revised 2007) TAS 36 (revised 2007) Impairment of Assets TFRS 5 (revised 2007) Non-current Assets Held for Sale and Discontinued Operations Accounting Treatment Guidance for Leasehold Right Accounting Treatment Guidance for Business Combination under Common Control These accounting standards, financial reporting standard and accounting treatment guidance became effective for the financial

statements for fiscal years beginning on or after 1 January 2009. The management has assessed the effect of these standards and believes that TFRS 5 (revised 2007) and Accounting Treatment Guidance for Business Combination under Common Control are not relevant to the business of the Company, while Framework for the Preparation and Presentation of Financial Statements (revised 2007), TAS 36 (revised 2007), and Accounting Treatment Guidance for Leasehold Right do not have any significant impact on the financial statements for the current year.

3.2 Accounting standards which are not effective for the current year Effective date

TAS 20 Accounting for Government Grants and Disclosure of Government Assistance 1 January 2012 TAS 24 (revised 2007) Related Party Disclosures 1 January 2011 TAS 40 Investment Property 1 January 2011 However, TAS 24 (revised 2007) and TAS 40 allows early adoption by the entity before the effective date.


The management of the Company has assessed the effect of these standards and believes that TAS 20 and TAS 40 are not relevant to the business of the Company, while TAS 24 (revised 2007) will not have any significant impact on the financial statements for the year in which it is initially applied.

4. Significant accounting policies 4.1 Revenue and expense recognition Sales of goods Sales of goods are recognised when the significant risks and rewards of ownership of the goods have passed to the buyer.

Sales are the invoiced value, excluding value added tax, of goods supplied after deducting discounts and allowances. Interest income Interest income is recognised as interest accrues based on the effective rate method. Expenses Expenses are recognised on an accrual basis. 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 accounts receivable, other receivables and allowance for doubtful accounts Trade accounts receivable 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 experiences and analysis of debt aging.

4.4 Inventories Inventories are valued at the lower of cost (average method) and net realisable value. Standard cost includes all production costs

and attributable factory overheads. 4.5 Investments a) Investments in available-for-sale securities are stated at fair value. Changes in the carrying amounts of securities are recorded as

separate items in shareholders’ equity until the securities are sold, when the changes are then included in determining income. b) Investments in non-marketable equity securities, which the Company classifies as other investments, are stated at cost net

of allowance for loss on diminution in value (if any). c) Investments in associates are accounted for in the consolidated financial statements using the equity method. d) Investments in subsidiaries and associates are accounted for in the separate financial statements using the cost method. The weighted average method is used for computation of the cost of investments. 4.6 Property, plant and equipment and 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 plant and equipment is calculated by reference to their costs on a straight-line basis over the following estimated useful lives:

Buildings and building improvements - 11 - 50 years Machinery and factory equipment - 5 - 10 years Office furniture and equipment - 5 - 11 years Motor vehicles - 5 - 10 years Miscellaneous equipment and research and development equipment - 1 - 7 years Depreciation is included in determining income. No depreciation is provided on land, land improvement, construction in progress and equipment under installation.


4.7 Intangible assets Intangible assets are carried at cost less any accumulated amortisation and any accumulated impairment losses. Intangible assets with finite lives are amortised on a systematic basis over the useful 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 asset are reviewed at least at each financial year end. The amortisation expense is charged to the income statement.

A summary of the intangible assets with finite useful lives is as follows. Useful lives Land occupancy rights - contract period of 50 years Patents - 5 years 4.8 Molds and spare parts Molds and spare parts are calculated by reference to their cost and amortised on a straight-line basis over 1-2 years. 4.9 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, and key management personnel, directors and officers with authority in the planning and direction of the Company’s operations.

4.10 Foreign currencies Transactions in foreign currency 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 balance sheet date.

Gains and losses on exchange are included in determining income. 4.11 Impairment of assets At each reporting date, the Company and its subsidiaries perform impairment reviews in respect of the property, plant and

equipment and other intangible assets whenever events or changes in circumstances indicate that an asset may be impaired. The Company and its subsidiaries also carry out annual impairment reviews in respect of asset. 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. In determining value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. In determining fair value less costs to sell, an appropriate valuation model is used. These calculations are corroborated by a valuation model that, based on information available, reflects the amount that the Company and its subsidiaries could obtain, from the disposal of the asset in an arm’s length transaction between knowledgeable, willing parties, after deducting the costs of disposal.

An impairment loss is recognised in the income statement. 4.12 Employee benefits Salaries, wages, bonuses and contributions to the social security fund and provident fund are recognised as expenses when

incurred. 4.13 Provisions Provisions are recognised when the Company and its subsidiaries 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.


4.14 Income tax Income tax is provided in the accounts based on the taxable profits from the non-promoted activities determined in accordance

with tax legislation. Income tax of the overseas subsidiaries is provided for in the accounts based on the taxable profits determined in accordance with tax legislation of their countries.

4.15 Derivatives Forward exchange contracts Receivables and payables arising from forward exchange contracts are translated into Baht at the rates of exchange ruling at the

balance sheet. Gains and losses from the translation are included in determining income. Premiums or discounts on forward exchange contracts are amortised on a straight-line basis over the contract periods.

Interest rate swap contracts The net amount of interest to be received from or paid to the counterparty under the interest rate swap contracts is recognised

as income or expenses on an accrual basis. Currency option agreement The notional amounts of the currency option agreements utilised by the Company and its subsidiaries are not recognised as

assets or liabilities upon inception of the agreement, but fees to be received or paid by the Company and its subsidiaries in respect of such agreements are amortised on a straight-line basis over the term of the agreement.

5. Significant accounting judgments and estimates The preparation of financial statements in conformity with generally accepted accounting principles at times requires management to

make subjective judgments and estimates regarding matters that are inherently uncertain. These judgments and estimates affect reported amounts and disclosures and actual results could differ. Significant judgments and estimates are as follows:

Leases In determining whether a lease is to be classified as an operating lease or finance lease, management is required to use judgment

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 judgment 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 subsidiaries treat available-for-sale equity investments and other investments as impaired when the management

judgment that there has been a 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 judgment.

Property, plant and equipment/Depreciation In determining depreciation of plant and equipment, the management is required to make estimates of the useful lives and salvage

values of the Company and its subsidiaries’ plant and equipment and to review estimated useful lives and salvage values when there are any changes.

Intangible assets The initial recognition and measurement of other intangibles, and subsequent impairment testing, requires 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.


6. Trade accounts receivable / trade accounts receivable - related parties The balances of trade accounts receivable as at 31 December 2009 and 2008, aged based on the basis of due date, are summarised

below. (Unit : Thousand Baht)

Age of receivables Not yet due 20,682,496 24,055,317 9,949,165 8,881,043 Past due Less than 1 month 1,037,362 2,934,849 709,160 223,189 1 - 2 months 573,892 1,538,614 18,104 51,174 2 - 3 months 28,160 741,060 9,826 18,074 3 - 6 months 295,074 1,526,475 15,706 12,835 6 - 12 months 139,158 131,777 12,334 12,860 Over 12 months 247,305 184,740 46,761 39,060

Total 23,003,447 31,112,832 10,761,056 9,238,235 Less: Allowance for doubtful accounts (155,298) (96,193) (42,569) (43,777)

Net 22,848,149 31,016,639 10,718,487 9,194,458

Consolidated Separate financial statements financial statements

2009 2008 2009 2008

The balances of trade accounts receivable - related parties as at 31 December 2009 and 2008, aged based on the basis of due date, are summarised below.

(Unit : Thousand Baht)

Age of receivables Not yet due 705,991 2,810,297 1,690,224 4,540,853 Past due Less than 1 month 114,390 4,920 83,007 1,035,922 1 - 2 months 1,041 720 15,220 1,430,216 2 - 3 months 4,392 - 18,601 1,648,630 3 - 6 months 2,215 27,592 30,269 574,577 6 - 12 months 71 9 71 8 Over 12 months 2 1,068 - 1,068

Total 828,102 2,844,606 1,837,392 9,231,274 Less: Allowance for doubtful accounts (8) (535) (8) (535)

Net 828,094 2,844,071 1,837,384 9,230,739


2009 2008 2009 2008


7. Related party transactions During the years, the Company and its subsidiaries had significant business transactions with their overseas related parties. Such

transactions are arose in the ordinary course of business and were concluded on commercial terms and bases agreed upon between the Company and those related parties.

The relationship between the Company and the related parties are summarised below.

Name of related parties Relationship with the Company

Kinpo Electronics, Inc. Major shareholders Logistar International Holding Co., Ltd. Subsidiary company Cal-Comp Electronics (Suzhou) Co., Ltd. Subsidiary company Cal-Comp Optical Electronics (Suzhou) Co., Ltd. Subsidiary company Cal-Comp Electronics & Communications Co., Ltd. Subsidiary company Cal-Comp Technology (Suzhou) Co., Ltd. Subsidiary company Cal-Comp Electronics and Communications (Suzhou) Co., Ltd. Subsidiary company A-Ten Technology Co., Ltd. Associated company (held by a subsidiary company) Wise Sigma International Holding Co., Ltd. Associated company (held by a subsidiary company) Telian Corporation Associated company and common directors inx Japan International Inc. Shareholding by the Company Zakang Inc. Shareholding by the Company Kinpo Group Management Service Co., Ltd. Shareholding by the subsidiary company Doctor Mobile Incorporated Shareholding by the subsidiary company Kinpo Electronics, Inc. (China) Co., Ltd. Subsidiary of the major shareholder Kinpo Electronics (Beijing) Co., Ltd. Subsidiary of the major shareholder Kinpo Electronics (Shanghai) Co., Ltd. Subsidiary of the major shareholder SaveCom International, Inc. Subsidiary of the major shareholder Kinpo International Co., Ltd. Common shareholders Vibo Telecom Co., Ltd. Common shareholders Leading Team Technology Ltd. Common shareholders Acbel Polytech Inc. Common shareholders Crownpo Technology, Inc. Common shareholders

Such significant transactions are summarised below. (Unit : Thousand Baht)

Transactions with subsidiaries (Eliminated from consolidated financial statements) Sales - - 8,434,608 17,816,181 Near market price Purchases of raw materials - - 2,309,460 5,220,630 Near market price Purchase of fixed assets - - 22,438 38,390 Cost

Consolidated Separate financial statements financial statements Transfer Pricing Policy


Consolidated Separate financial statements financial statements Transfer Pricing Policy

2009 2008 2009 2008


Transactions with related parties Sales - Kinpo Electronics, Inc. 1,268,348 2,978,055 6,302,078 10,092,517 Near market price - Kinpo International Co., Ltd. 27,059 684 8,578 - Near market price - Others 1,991 13,791 - - Near market price Sales of fixed assets 207,787 60,378 - - At book value plus margin Purchases of raw materials 1,898,806 8,899,807 28,772 147,926 Near market price Purchase of fixed assets - 22 - 22 Cost Other expenses 67,044 38,550 - - Contract price Interest income 1,011 985 - - 2% per annum

The balances of the accounts as at 31 December 2009 and 2008 between the Company and those related companies are as follows: (Unit : Thousand Baht)

Trade accounts receivable - related parties Subsidiaries (eliminated from the consolidated financial statements) - Logistar International Holding Co., Ltd. - - 1,787,796 6,372,851 - Cal-Comp Electronics (Suzhou) Co., Ltd. - - 8,199 7,845 - Cal-Comp Optical Electronics (Suzhou) Co., Ltd. - - 2,646 35,049 - Cal-Comp Electronics & Communications Co., Ltd. - - 29 434 - Cal-Comp Technology (Suzhou) Co., Ltd. - - 315 - - Cal-Comp Electronics and Communications (Suzhou) Co., Ltd. - - - 312

- - 1,798,985 6,416,491

Related companies - Kinpo Electronics, Inc. 809,230 2,843,986 29,884 2,814,415 - Kinpo International Co., Ltd. 18,872 368 8,523 368 - Others - 252 - -

Total 828,102 2,844,606 38,407 2,814,783 Less: Allowance for doubtful accounts (8) (535) (8) (535)

828,094 2,844,071 38,399 2,814,248

828,094 2,844,071 1,837,384 9,230,739


2009 2008 2009 2008




2009 2008 2009 2008

Short-term loans to related parties Related companies - Wise Sigma International Holding Co., Ltd. 62,312 64,224 - - - A-Ten Technology Co., Ltd. 76,912 83,624 - -

Total 139,224 147,848 - - Less: Allowance for doubtful accounts (68,000) - - -

71,224 147,848 - -

Amounts due from related parties Subsidiaries (eliminated from consolidated financial statements) - Logistar International Holding Co., Ltd. - - 6,463 80,959 - Cal-Comp Optical Electronics (Suzhou) Co., Ltd. - - - 22 - Cal-Comp Electronics (Suzhou) Co., Ltd. - - - 801

- - 6,463 81,782

Related companies - A-Ten Technology Co., Ltd. 11,976 - - - - Kinpo International Co., Ltd. - 158,758 - 158,758 - Kinpo Electronics, Inc. (China) Co., Ltd. - 58,393 - - - Acbel Polytech Inc. - 3,619 - 2,654 - Others 9 12,540 - -

Total 11,985 233,310 - 161,412 Less: Allowance for doubtful accounts - - - (504)

11,985 233,310 - 160,908

11,985 233,310 6,463 242,690

Trade accounts payable - related parties Subsidiaries (eliminated from the consolidated financial statements) - Logistar International Holding Co., Ltd. - - 411,594 707,144 - Cal-Comp Electronics (Suzhou) Co., Ltd. - - 1 9,516 - Cal-Comp Optical Electronics (Suzhou) Co., Ltd. - - 1,085 -

- - 412,680 716,660

Related companies - Kinpo Electronics, Inc. 15,706 2,857,042 105 - - Zakang Inc. - 3,465 - - - Kinpo International Co., Ltd. 59 52 59 52 - Kinpo Electronics, Inc. (China) Co., Ltd. - 2,740,212 - - - Acbel Polytech Inc. 5,593 70,350 5,571 70,350 - Others 208 51 - -

21,566 5,671,172 5,735 70,402

21,566 5,671,172 418,415 787,062


During 2009, movements of short-term loans to related parties were as follows: - (Unit : Thousand Baht)



2009 2008 2009 2008

Advance from and amounts due to related parties Subsidiaries (eliminated from the consolidated financial statements) - Logistar International Holding Co., Ltd. - - 209,718 - - Cal-Comp Electronics (Suzhou) Co., Ltd. - - 40,739 - - Cal-Comp Optical Electronics (Suzhou) Co., Ltd. - - 15,072 6,532 - Cal-Comp Electronics & Communications Co., Ltd. - - 807 1,916 - Cal-Comp Technology (Suzhou) Co., Ltd. - - - 1,866

- - 266,336 10,314

Related companies - Kinpo Electronics, Inc. 263 236 263 236 - Acbel Polytech Inc. 629 3,162 629 3,162 - Other 2 204 2 -

894 3,602 894 3,398

894 3,602 267,230 13,712

Short-term loans to related parties Wise Sigma International Holding Co., Ltd. 64,224 - 983 (2,895) 62,312 A-Ten Technology Co., Ltd. 83,624 (2,992) - (3,720) 76,912

147,848 (2,992) 983 (6,615) 139,224

Consolidated financial statements

Balance Balance as at as at 1 January Interest 31 December 2009 Decrease receivable Translation 2009

Short-term loans to Wise Sigma International Holding Co., Ltd. were denominated in US dollar currency and interest was charged at the rate of 2 percent per annum.

Net foreign currency assets and liabilities have been included in Note 34.


9. Advances payment for raw materials Included in the balances as at 31 December 2009 and 2008 mainly consist of: - a) Short-term loans of Baht 95 million (2008: Baht 95 million) provided to local suppliers for use as working capital in agreed

production of raw materials, on which interest is charged at the rate of 6.25 percent per annum (2008: 6.25 percent per annum). b) Advance payment of Baht 239 million (net of allowance for doubtful debt of Baht 45 million) (2008: Baht 327 million) for the

purchase of raw materials and others. c) Advance payment of Baht 48 million to suppliers (2008: Baht 51 million) for the purchase of molds and raw materials. The

remaining balances is to be paid upon the completion of molds (please refer to Note 33.3). 10. Other receivables The balances as at 31 December 2009 and 2008 (net of allowance for doubtful debt of Baht 4 million and Baht 1 million, respectively)

represent suspense accounts receivable set up for the expense can be passed on to customers or vendors and for raw materials which were purchased from suppliers and the inventories to which engineering or component changes have been made. The Company and its subsidiaries set up these suspense accounts while awaiting the return of the raw materials from the creditors.

8. Inventories (Unit : Baht)


Allowance of diminution in value of inventory

Reduction cost to net Cost realisable value Stock obsolescence Inventory-net

2009 2008 2009 2008 2009 2008 2009 2008

Finished goods 667,104,625 1,073,298,548 (2,128,331) (11,354,721) (31,509,078) (43,247,366) 633,467,216 1,018,696,461

Work in process 229,211,166 38,748,324 - - - - 229,211,166 38,748,324

Raw materials 7,542,711,927 8,659,736,700 (10,000,000) - (163,129,343) (42,389,696) 7,369,582,584 8,617,347,004

Total 8,439,027,718 9,771,783,572 (12,128,331) (11,354,721) (194,638,421) (85,637,062) 8,232,260,966 9,674,791,789

(Unit : Baht)

Separate financial statements

Allowance of diminution in value of inventories

Reduction cost to net Cost realisable value Stock obsolescence Inventory-net

2009 2008 2009 2008 2009 2008 2009 2008

Finished goods 385,912,228 800,605,567 (2,128,331) (11,354,721) (30,022,229) (41,787,475) 353,761,668 747,463,371

Work in process 220,775,893 24,768,077 - - - - 220,775,893 24,768,077

Raw materials 3,512,080,238 3,610,039,773 (10,000,000) - (35,915,244) (26,418,199) 3,466,164,994 3,583,621,574

Total 4,118,768,359 4,435,413,417 (12,128,331) (11,354,721) (65,937,473) (68,205,674) 4,040,702,555 4,355,853,022


11. Other current assets The balances as at 31 December 2009 and 2008 consist of: -


Receivable - molds 144,473 154,746 30,867 69,993

Other receivables 13,026 3,606 9,622 3,606

Premiums on option contracts 416,890 581,391 - -

Value added tax 77,081 470,437 1,830 1,066

Properties foreclosed 43,584 45,761 43,584 45,761

Less: Allowance for impairment loss (43,584) - (43,584) -

Properties foreclosed - net - 45,761 - 45,761

Others 178,502 105,457 9,387 19,275

Total 829,972 1,361,398 51,706 139,701


2009 2008 2009 2008

12. Investments in subsidiaries Details of investments in subsidiaries as presented in separate financial statements are as follows: -


Company’s name Paid up capital Shareholding percentage Cost method

2009 2008 2009 2008 2009 2008 % %

Logistar International Holding USD 30.5 USD 10.05 100 100 1,077,604 2,280 Co., Ltd. and its subsidiaries million million Cal-Comp Electronics USD 27.2 USD 27.2 100 100 921,761 921,761 (Suzhou) Co., Ltd. million million Cal-Comp Optical Electronics USD 41.3 USD 41.3 100 100 1,023,834 1,023,834 (Suzhou) Co., Ltd. million million Cal-Comp Electronics & TWD 70 TWD 70 100 100 92,510 92,510 Communications Co., Ltd. million million Cal-Comp Technology USD 10 USD 10 100 100 338,541 338,541 (Suzhou) Co., Ltd. million million Cal-Comp Electronics USD 19 USD 15 100 100 624,396 488,334 and Communications million million (Suzhou) Co., Ltd.

Total 4,078,646 2,867,260 Less: Allowance for impairment (300,000) (300,000)

Net 3,778,646 2,567,260

On 22 December 2006, a meeting of the Board of Directors of the Company approved the establishment of a representative office in Mumbai, India by Logistar International Holding Co., Ltd., a subsidiary. The purpose of the office is to provide support for sales and marketing for telecom products in the Indian market. Total investment is not to exceed USD 500,000 and is in the process of operation.


On 13 August 2007, a meeting of the Board of Directors of the Company approved a joint investment with a non-related person to set up a new plant in India. The Company will invest approximately USD 5 million or 40 percent shareholding. The purpose of the investment is to expand the production capacity for the telecommunications products and computer peripheral products. On 15 May 2009, a meeting of the Board of Directors of the Company approved the withdrawal of this investment. Since the Company’s production capacity is sufficient to support the current demand of orders.

During 2008, the Company has recorded impairment loss of investment in Logistar International Holding Co., Ltd. of Baht 300 million in the separate income statement of the year 2008.

On 19 December 2008, a meeting of the Board of Directors of the Company granted approval to additionally invest in Logistar Holding International Co., Ltd. totaling USD 10 million. The Company paid of USD 10 million in December 2008. However, as at 31 December 2008 Logistar International Holding Co., Ltd. has yet to register the increase in its share capital, and the Company therefore recorded the additional investment as “Advance for share acquisition” in the balance sheet.

On 12 February 2009, a meeting of the Board of Directors of the Company granted approval to additionally invest in Logistar Holding International Co., Ltd. totaling USD 20 million. The Company paid of USD 20 million in March 2009. The subsidiary has already registered the increase in its share capital in the first quarter of the current year.

On 3 August 2009, a meeting of the Board of Directors of the Company granted approval to additionally invest in Cal-Comp Electronics and Communications (Suzhou) Co., Ltd. totaling USD 20 million. This investment expects to be completed in August 2011. The Company paid of USD 4 million in September 2009. The subsidiary has already registered the increase in its share capital in the fourth quarter of the current year.

13. Investments in associates 13.1 Details of associates



Carrying amount Nature of Country of Shareholding based on Company’s name business incorporation percentage Cost method equity method

2009 2008 2009 2008 2009 2008 % %

Telian Corporation Mobile phone Korea 23.87 23.87 57,825 57,825 - -

Wise Sigma International Holding company British Virgin 45.00 45.00 87,994 87,994 - -

Holding Co., Ltd.* Islands

A-Ten Technology Telecommunication Taiwan 34.00 34.00 9,864 9,864 11,945 13,086

Co., Ltd.* research and

development

Total 155,683 155,683 11,945 13,086

* (held by Logistar International Holding Co., Ltd.)


13.2 Summarised financial information of associates Financial information of the associated companies is summarised below.

(Unit : Million Baht)

(Unit: Thousand Baht)


Carrying Provision for amounts based Company’s Nature of Country of Shareholding impairment on cost name business incorporation percentage Cost of investments method - net

2009 2008 2009 2008 2009 2008 2009 2008 % %

Telian Corporation Mobile phone Korea 23.87 23.87 57,825 57,825 (57,825) (57,825) - -

Total 57,825 57,825 (57,825) (57,825) - -

(Unit: Million Baht)


Share of loss from investments Company’s name in associates during the year

2009 2008

Telian Corporation - -

Total revenues Net income Total assets Total liabilities for the (loss) for Company’s Paid-up capital as at as at as at year ended the year ended name 31 December 31 December 31 December 31 December 31 December

2009 2008 2009 2008 2009 2008 2009 2008 2009 2008

Telian Corporation KW 3,346 KW 3,346 459* 459* 755* 755* 163* 163* (119)* (119)*

million million

Wise Sigma USD 5 USD 5 106 111 66 66 - - (1.1) 48

International million million

Holding Co., Ltd.

A-Ten Technology TWD 30 TWD 30 131 138 96 101 - 12 (0.4) 2

Co., Ltd. million million

The above financial information were prepared by the management of the associated company, which were unaudited by its auditor.

13.3 Investment in associated with capital deficit The Company recognised share of losses from investments in an associated company, as listed below, until the value of the

investments reached zero. Subsequent losses incurred by those associates have not been recognised in the Company’s accounts since the Company has no obligations, whether legal or constructive, to make any payments on behalf of those associates. The amount of such unrecognised share of losses is set out below.


Unrecognised share of losses

Share of losses for the Cumulative share year ended of losses up to Company’s name 31 December 2009 31 December 2009

Telian Corporation -* 76*

(Unit : Million Baht)

* The financial information of Telian Corporation were determined on the basis of lasted financial information (30 June 2008) provided by this associated company’s management because the company ceased its operation. However, the Company has already set up the provision for impairment in full amount.

14. Other long-term investments


Country


Nature of of incor- Shareholding Investments

Company’s name business poration percentage Cost method Fair value

2009 2008 2009 2008 2009 2008 % %

Investments in other companies Zakang Inc. CDMA Korea 1.04 1.04 171,247 171,247 - 845

Less: Unrealised loss on change in the value of investment - (120,402) Allowance for loss on impairment (171,247) (50,000)

- 845

Power Digital Communication Trading of Co., Ltd. communication apparatus Taiwan 1.90 1.90 22,260 23,311 inx Japan International Inc. Distributor of Japan 19.98 19.98 3,645 3,645 computers products BC2L Ltd. Produces and develop Singapore 7.00 7.00 16,684 17,472 Bluetooth technology Doctor Mobile Incorporated Trading of mobile British Virgin 10.00 10.00 10,011 10,483 phone Islands Kinpo Group Management Service Co., Ltd. Consulting business Taiwan 12.50 12.50 1,031 1,058

53,631 55,969

Total other long-term investments 53,631 56,814



Country


Nature of of incor- Shareholding Investments

Company’s name business poration percentage Cost method Fair value

2009 2008 2009 2008 2009 2008 % %

Investments in other companies Zakang Inc. CDMA Korea 1.04 1.04 171,247 171,247 - 845

Less: Unrealised loss on change in the value of investment - (120,402) Allowance for loss on impairment (171,247) (50,000)

- 845

inx Japan International Inc. Distributor of computers products Japan 19.98 19.98 3,645 3,645

Total other long-term investments 3,645 4,490

On 22 December 2006, a meeting of the Board of Directors of the Company approved investment to acquire 9.06 million shares or a 15% interest in Apex Circuit (Thailand) Company Limited, a company registered in Thailand. This company is principally engaged in the manufacture of printed circuit board and is in the process of operation.

In the current year, the Company has recorded impairment loss of other long-term investments of Baht 121 million in the income statements for the current year, by reversing the revaluation deficit on changes in value of investments which is presented in the shareholders’ equity (2008: Baht 50 million).

15. Property, plant and equipment

(Unit : Baht)


Construction in progress, equipment Buildings Machinery Office under Land and land and buildings and factory furniture and Motor installation and improvements improvements equipment equipment vehicles assets in transit Total

Cost

31 December 2008 109,789,401 3,504,787,842 6,932,629,854 1,240,945,712 38,059,243 65,215,477 11,891,427,529

Additions - 48,126,037 312,914,793 96,282,392 6,002,657 832,515,519 1,295,841,398

Disposals - (125,721,418) (1,009,764,982) (130,490,560) (2,841,229) - (1,268,818,189)

Transfers in (out) - 20,641,455 702,097,010 8,685,248 483,141 (853,298,063) (121,391,209)

Translation adjustment - (86,179,614) (118,147,349) (31,573,659) (902,282) (485,269) (237,288,173)

31 December 2009 109,789,401 3,361,654,302 6,819,729,326 1,183,849,133 40,801,530 43,947,664 11,559,771,356


(Unit : Baht)



Accumulated depreciation 31 December 2008 - 775,762,247 2,358,841,622 555,700,241 16,977,668 - 3,707,281,778 Depreciation for the year - 95,260,107 624,694,791 161,328,371 4,060,961 - 885,344,230 Depreciation on disposals - (119,250,733) (604,956,967) (74,065,875) (981,249) - (799,254,824) Translation adjustment - (5,756,473) (36,044,906) (12,101,564) (310,958) - (54,213,901)

31 December 2009 - 746,015,148 2,342,534,540 630,861,173 19,746,422 - 3,739,157,283

Allowance for impairment loss 31 December 2008 - - - - - - - Increase during the year - 23,333,211 - - - - 23,333,211

31 December 2009 - 23,333,211 - - - - 23,333,211

Net book value 31 December 2008 109,789,401 2,729,025,595 4,573,788,232 685,245,471 21,081,575 65,215,477 8,184,145,751

31 December 2009 109,789,401 2,592,305,943 4,477,194,786 552,987,960 21,055,108 43,947,664 7,797,280,862

Depreciation for the year 2008 (Baht 812 million included in manufacturing cost, and the balance in selling and administrative expenses) 823,270,474

2009 (Baht 865 million included in manufacturing cost, and the balance in selling and administrative expenses) 885,344,230

(Unit : Baht)



Cost 31 December 2008 109,789,401 1,438,449,391 4,208,290,489 450,074,198 19,445,789 34,584,340 6,260,633,608 Additions - 9,255,730 6,929,855 32,490,797 - 832,596,222 881,272,604 Disposals - (125,721,418) (583,951,344) (71,899,420) (1,927,205) - (783,499,387) Transfers in (out) - 17,775,700 687,338,309 8,106,889 - (824,607,058) (111,386,160)

31 December 2009 109,789,401 1,339,759,403 4,318,607,309 418,772,464 17,518,584 42,573,504 6,247,020,665

Accumulated depreciation 31 December 2008 - 660,828,020 1,822,274,930 235,198,480 10,197,127 - 2,728,498,557 Depreciation for the year - 55,156,757 383,485,526 36,869,090 1,993,408 - 477,504,781 Depreciation on disposals - (116,369,760) (506,223,039) (41,929,525) (587,393) - (665,109,717)

31 December 2009 - 599,615,017 1,699,537,417 230,138,045 11,603,142 - 2,540,893,621


A subsidiary entered into an agreement with third parties on August 2008 regarding sale of land and building totaling TWD 597 million (excluding tax) (approximately Bath 633 million). As of 30 September 2008, the ownership transfer was completed and the subsidiary recognised gain on sale of fixed asset amounting to TWD 228 million or Baht 242 million in the income statement of the year 2008.

As at 31 December 2009, certain machinery and factory equipment and office equipment items have been fully depreciated but are still in use. The original cost of those assets amounted to approximately Baht 1,197 million (2008: Baht 898 million) (Separate financial statements: Baht 803 million 2008: Baht 834 million).

16. Intangible assets Patents A subsidiary entered into a guaranty agreement with Telian Corporation, an associated of the Company, to be authorised and guaranty

for utilizing Telian’s technologies assets such as patents, licenses, softwares and hardwares intellectual property. (Unit : Thousand Baht)

(Unit : Baht)



Allowance for impairment loss 31 December 2008 - - - - - - - Increase during the year - 23,333,211 - - - - 23,333,211

31 December 2009 - 23,333,211 - - - - 23,333,211

Net book value 31 December 2008 109,789,401 777,621,371 2,386,015,559 214,875,718 9,248,662 34,584,340 3,532,135,051

31 December 2009 109,789,401 716,811,175 2,619,069,892 188,634,419 5,915,442 42,573,504 3,682,793,833

Depreciation for the year 2008 (Baht 456 million included in manufacturing cost, and the balance in selling and administrative expenses) 461,412,703

2009 (Baht 472 million included in manufacturing cost, and the balance in selling and administrative expenses) 477,504,781

Cost 725,911 484,448 Increase during the year 98,549 241,463 Translation adjustment (29,697) 8,696 Accumulated amortisation (370,593) (220,811)

Net book value 424,170 513,796

Amortisation expenses included in the income statements for the year 149,782 135,023


2009 2008


Other non-current assets - others This amount included premiums on option contracts of Baht 416 million (2008: Baht 175 million). 18. Short-term loans from financial institutions Short-term loans from financial institutions of the Company and its subsidiaries consist of loans from both local banks and overseas

financial institutions in both local currency and foreign currency. The loans are mainly repayable within 3 months, and carry interest rates of 0.7 - 1.5 percent per annum. It major shareholders has issued a letter of awareness to a bank for credit facilities.

19. Other payables The outstanding balance represents accounts payable suspense for goods sales which there are subject to changes in price,

specifications and other components. 20. Other current liabilities The balance as at 31 December 2009 and 2008 consist of: -


17. Other non-current assets Land occupancy rights The balance represents the land occupancy rights of two subsidiaries in the People’s Republic of China. These rights are for 50 years.


Cost 92,345 68,555 Increase during the year - 23,790 Translation adjustment 1,300 5,319 Accumulated amortisation (9,248) (7,654)

Net book value 84,397 90,010

Amortisation expenses included in the income statements for the year 1,594 2,102


2009 2008

Advances received from customers for purchase of molds 30,389 24,878 30,389 24,878 Money received from customers pending for clear 222,838 323,456 74,538 15,124 Value added tax payable 59,152 3,224 59,152 3,224 Others 25,913 23,951 7,570 11,064

Total 338,292 375,509 171,649 54,290


2009 2008 2009 2008


On 18 June 2004, the Company entered into a 5-year syndicated loan agreement with financial institutions for a facility of USD 80 million. The loan carries interest at LIBOR plus margin per annum and is to be repaid in semi-annually installments, the first of which will be due in June 2006. During the current year, the Company paid all loans.

On 31 August 2009, a meeting of the Board of Directors of the Company approved the syndicated loan for the Company and Logistar International Holding Co., Ltd., its subsidiary. The loan facility of USD 120 million has a period of 3 years and is extendable for 2 years. The purpose of the loan is to improve the financial structure and increase working capital to support business operations. As at 31 December 2009, the Company and its subsidiary have not yet withdrawn the loan from the above credit facility.

22. Share capital / premium on common stocks During the current year, warrants were exercised to purchase new ordinary shares as described in Note 23. As of 31 December 2009

the issued and paid-up share capital of the Company has increased by Baht 10,185,653 as a result of the exercise of the warrants, from Baht 3,930,923,139 to Baht 3,941,108,792.

Reconciliation of number of issued and paid up share capital (Unit : Shares)

21. Long-term loans (Unit : Thousand Baht)

Loans from financial institutions - 400,942 - 400,942 Less: Current portion - (400,942) - (400,942)

Long-term loans, net - - - -


2009 2008 2009 2008

Number of ordinary shares at the beginning of year 3,930,923,139 3,919,208,416 Increase in number of ordinary shares due to exercise of warrants 10,185,653 11,714,723

Number of ordinary shares at the end of year 3,941,108,792 3,930,923,139

For the years ended 31 December

2009 2008

23. Warrants Warrant (CCET-W1) On 23 March 2005, the Annual General Meeting of the Company’s shareholders approved the issuance of warrants (CCET-W1). On

14 February 2006, the Board of Directors’ meeting approved the additional details as follows: £ The date of issue of warrants is 19 April 2006. £ The first warrant exercise date is 8 September 2006. £ The last warrant exercise date is 18 April 2009. £ The exercise price is Baht 5 per share.* £ The exercise ratio is 1 warrant per 1 ordinary share.* £ The warrants can be exercised on the 10th of March, June, September and December every year. * On 28 September 2007, the Company readjusted the exercise ratio and exercise price of warrants (CCET-W1) to a ratio of

1 warrant to 1.03389 new ordinary shares at an exercise price of Baht 4.836 per share.


During the current year, the warrant holders have exercised their rights (CCET-W1) of 9,072,971 units to purchase ordinary shares of 9,380,453 shares at an exercise price of Baht 4.836 each, amounting to Baht 45.4 million. There are 676.6 million warrants (CCET-W1) as expired during the current year and there are no outstanding warrant as at 31 December 2009.

Warrants issued to employees (ESOP) (CCET-W2) On 29 March 2007, the Annual General Meeting of the Company’s shareholders approved the issue and allocate 156,000,000 3-years

warrants (ESOP) to the employees of the Company and/or its subsidiaries, including the new employees with the expertise in R&D or engineering and who will provide the Company with the benefits at most over the long-term at a price of Baht 0 per unit. One warrant can be exercised to purchase 1 ordinary share at a price of Baht 1 per share. The warrant holders are entitled to exercise the warrant 9 times (revised) throughout the term of the warrants. The warrants can be gradually exercised as follows:

£ The First exercise, no more than 30% of the total warrants any individual received from the Company. £ The Second to Fifth exercise, no more than 60% of the total warrants any individual received from the Company (the exercisable

amount including the first exercisable amount). £ The Sixth to Ninth exercise, all remain warrants can be exercised (the exercisable amount including the first to fifth

exercisable amounts). The Stock Exchange of Thailand (SET) has approved the warrants on the SET, trading can commence from 11 October 2007. The first

exercising date is 29 September 2008 and the last exercising date is 28 September 2010 (expiry date of ESOP). During the current year, the warrant holders have exercised their rights (CCET-W2) to purchase ordinary shares of 805,200 warrants.

As at 31 December 2009, there are 144,277,500 warrants (CCET-W2) remained unexercised. 24. Statutory reserve Pursuant to Section 116 of the Public Limited Companies Act B.E. 2535, the Company is required to set aside to a statutory reserve

at least 5 percent of its net income after deducting accumulated deficit brought forward (if any), until the reserve reaches 10 percent of the registered capital. The statutory reserve is not available for dividend distribution.

25. Expenses by nature Significant expenses by nature are as follow: (Unit : Thousand Baht)

Salary and wages and other employee benefits 2,182,687 2,343,100 584,529 679,500 Depreciation 885,344 823,270 477,505 461,413 Loss on impairment of property, plant and equipment 23,333 - 23,333 - Amortisation expenses 1,193,441 194,529 65,872 47,390 Exchange gains (loss) 75,904 245,648 (188,842) 68,824 Rental expenses 62,610 47,545 1,824 1,826 Raw materials and consumables used 62,058,647 69,543,374 57,235,730 62,971,496 Changes in inventories of finished goods and work in progress 194,766 (392,799) 197,694 (305,914)


2009 2008 2009 2008


26. Exchange gains (loss) (Unit : Thousand Baht)

Realised exchange gains (loss) 33,896 (199,017) 270,425 22,720 Unrealised exchange loss (109,800) (46,631) (81,583) (91,544)

Exchange gains (loss) - net (75,904) (245,648) 188,842 (68,824)


2009 2008 2009 2008

27. Promotional privileges The Company has been granted promotional privileges under the Investment Promotion Act B.E. 2520, for the manufacture of

electronics and electronics equipment, by the Board of Investment under certain significant conditions. Significant privileges of the Company are as follow:

1. Certificate No. 1206/2543 2079(2)/2547 1661(2)/2549 1309(2)/2550 1992(2)/2550 2231(2)/2551 2. The significant privileges are 2.1 Exemption of corporate income tax for net income 8 years 4 years 8 years 5 years 8 years 5 years from promotional privileges and exemption of (Expired) (Expired) income tax on dividends paid from the income of the operations throughout the period in which the corporate income tax is exempted. 2.2 Allowance for 5% of the increment in export Granted Non-granted Non-granted Non-granted Non-granted Non-granted income over the preceding year for ten years, providing that the export income of that particular year should not be lower than the average export income over the three preceding years except for the first two years. 2.3 Exemption of import duty on machinery as Granted Granted Granted Granted Granted Granted approved by the board. (Expired) (Expired) 2.4 Exemption of import duty on raw materials and Granted Granted Granted Granted Granted Granted significant supplies used in export production for (Expired) (Expired) (5 years) (Expired) (5 years) (1 year) a period of (year) from the first import date. (5 years) (1 year) (1 year) 2.5 A fifty percent reduction of the normal rate of Granted Non-granted Non-granted Non-granted Non-granted Non-granted corporate income tax on net income derived from the promoted activity for a period of five years after the expiration of the above corporate income tax exemption period. 3. Date of first earning operating income 27 May 2000 2 Jan 2005 22 Jul 2006 6 Oct 2007 24 Oct 2007 2 Jan 2009

Details


28. Earnings per share Basic earnings per share is calculated by dividing net income for the year by the weighted average number of ordinary shares in issue

during the year. Diluted earnings per share is calculated by dividing net income for the year by the weighted average number of ordinary shares in

issue during the year plus the weighted average number of ordinary shares which would need to be issued to convert all dilutive potential ordinary shares into ordinary shares. The calculation assumes that the conversion took place either at the beginning of the year or on the date the potential ordinary shares were issued.

The following table sets forth the computation of basic and diluted earnings per share:

The Company’s operation revenues for the years are below shown divided according to promoted and non-promoted operations. (Unit : Million Baht)

Sales Domestic sales 11,944 9,013 - - 11,944 9,013 Export sales 48,087 58,022 176 358 48,263 58,380

Total sales 60,031 67,035 176 358 60,207 67,393

Promoted operations Non-promoted operations Total

2009 2008 2009 2008 2009 2008


Weighted average number Net income of ordinary shares Earnings per share

2009 2008 2009 2008 2009 2008 Million Million Million Million Baht Baht Baht Baht share share

Basic earnings per share Net income 1,301 2,128 3,938 3,922 0.33 0.54

Effect of dilute potential ordinary shares Warrants CCET-W2 (ESOP) - - 92 119

Diluted earnings per share Net income of ordinary shareholders assuming the conversion of diluted potential ordinary shares 1,301 2,128 4,030 4,041 0.32 0.53


Weighted average number Net income of ordinary shares Earnings per share

2009 2008 2009 2008 2009 2008 Million Million Million Million Baht Baht Baht Baht share share

Basic earnings per share Net income 1,336 2,470 3,938 3,922 0.34 0.63

Effect of dilute potential ordinary shares Warrants CCET-W2 (ESOP) - - 92 119

Diluted earnings per share Net income of ordinary shareholders assuming the conversion of diluted potential ordinary shares 1,336 2,470 4,030 4,041 0.33 0.61


No calculation of diluted earnings per share for 2008 is required for warrant (CCET-W1) since the exercise price of the warrants is in excess of fair value of the Company’s ordinary shares.

No calculation of diluted earnings per share for 2009 is required for warrant (CCET-W1) since the warrants were expired during the current year.

29. Segment information The Company and its subsidiaries’ business operations involve the single industry segment of manufacturing and distributing electronic

equipment. Below is the consolidated financial information for the years ended 31 December 2009 and 2008 of the Company and its subsidiaries

by segment: - (Unit : Million Baht)

Sales - external 11,800 9,129 95,341 111,163 107,141 120,292 - - 107,141 120,292 - related parties - - 60,583 78,483 60,583 78,483 (59,286) (75,490) 1,297 2,993

11,800 9,129 155,924 189,646 167,724 198,775 (59,286) (75,490) 108,438 123,285

Segment income 314 393 1,517 2,065 1,831 2,458 1,831 2,458 Unallocated income and expense:: Other income 182 474 Administrative expenses (45) (31) Impairment loss of other long-term investment (121) (50) Impairment loss of assets (23) - Financial cost (355) (577) Corporate income tax (168) (146)

Net income 1,301 2,128

For the years ended 31 December

Local sales Overseas sales Total Elimination Consolidation

2009 2008 2009 2008 2009 2008 2009 2008 2009 2008

Transfer prices between business segments are as set out in Note 7. (Unit : Million Baht)

As at 31 December

Local Overseas Consolidation

2009 2008 2009 2008 2009 2008

- Property, plant and equipment, net 3,683 3,532 4,114 4,652 7,797 8,184 - Unallocated assets 38,808 51,304

Total assets 46,605 59,488

30. Provident fund The Company and its employees have jointly established a provident fund in accordance with the Provident Fund Act B.E. 2530. The

fund is monthly contributed to by employees, at the rate of 2 percent of their basic salaries, and by the Company at the same rate. The fund, which is managed by TISCO Securities Company Limited, will be paid to employees upon termination in accordance with the fund rules. During the year 2009, the Company contributed Baht 0.4 million (2008: Baht 0.7 million) to the fund.


32. Statements of cash flows For the purpose of the statements of cash flows, cash and cash equivalents include cash in hand and at financial institutions with an

original maturity of 3 months or less and without restriction. Cash and cash equivalents as reflected in the statements of cash flows consist of the followings: -


31. Dividends

Final dividends for 2007 Annual General Meeting of the shareholders on

27 March 2008 783.8 0.20

Interim dividends for 2008 Board of Directors’ meeting on 13 August 2008 784.0 0.20

Total for 2008 1,567.8

Interim dividends for 2009 Board of Directors’ meeting on 3 August 2009 197.0 0.05

Total for 2009 197.0

Dividend Dividends Approved by Total dividends per share

Million Baht Baht

Cash 1,075 1,291 306 306

Deposits at financial institutions 2,664,947 2,081,894 517,547 433,627

Cash and cash equivalents 2,666,022 2,083,185 517,853 433,933

Current investments - Term

deposits with financial institutions 969,551 1,525,041 720,001 592,501

Cash and cash equivalents in statements of cash flows 3,635,573 3,608,226 1,237,854 1,026,434


2009 2008 2009 2008

33. Commitments and contingent liabilities 33.1 Capital commitments As at 31 December 2009, the Company had outstanding commitments of Baht 1.1 million in respect of purchase equipment

(2008: Baht 14.5 million). 33.2 Other commitments As at 31 December 2009, the Company had outstanding commitment of TWD 30 million and USD 16 million in respect of

uncalled portion of investments in its subsidiaries (2008: TWD 30 million). 33.3 Agreements for hire of production of molds As at 31 December 2009, the Company had outstanding commitments of Baht 9.5 million with overseas suppliers in respect of

agreements for hire of production of molds (2008: Baht 15.4 million). 33.4 Guarantees As at 31 December 2009, there were outstanding bank guarantees of approximately Baht 236 million (2008: Baht 236 million)

issued by the banks on behalf of the Company in respect of certain performance bonds as required in the normal course of business. Its major shareholders has issued a letter of awareness to a bank for credit facilities.


34. Financial instruments 34.1 Financial risk management The Company and its subsidiaries’ financial instruments, as defined under Thai Accounting Standard No. 32 “Financial

Instruments: Disclosure and Presentations”, principally comprise cash and cash equivalents, trade accounts receivable, loans, investments, and short-term and long-term loans. The financial risks associated with these financial instruments and how they are managed is described below.

Credit risk The Company and its subsidiaries are exposed to credit risk primarily with respect to trade accounts receivable, loans, notes and

other receivable. The Company and its subsidiaries manage the risk by adopting appropriate credit control policies and procedures and therefore do not expect to incur material financial losses. The maximum exposure to credit risk is limited to the carrying amounts of receivables, loans, other receivables and notes receivable as stated in the balance sheet.

Interest rate risk The Company and its subsidiaries’ exposure to interest rate risk relates primarily to its cash at banks and borrowings. However,

since most of the Company and its subsidiaries’ financial assets and liabilities bear floating interest rates or fixed interest rates which are close to the market rate, the interest rate risk is expected to be minimal.

Significant financial assets and liabilities as at 31 December 2009 classified by type of interest rates are summarised in the table below, with those financial assets and liabilities that carry fixed interest rates further classified based on the maturity date, or the repricing date if this occurs before the maturity date.


Fixed interest rates Floating Non-interest Average within 1 year interest rate bearing Total interest rate

(Million Baht) (% per annum)

Financial assets - Cash and cash equivalents - 2,660 6 2,666 0.01 - 1.71 - Current investments 970 - - 970 0.4 - 1.7 - Trade accounts receivable - - 22,848 22,848 - - Trade accounts receivable - related parties - - 828 828 - - Short-term loans to related parties 32 - 39 71 2

1,002 2,660 23,721 27,383

Financial liabilities - Short-term loans from financial institutions 4,739 4,065 - 8,804 0.7-1.5 - Trade accounts payable - - 18,788 18,788 -

4,739 4,065 18,788 27,592


The Company entered into interest rate swap agreement to manage risk associated with the financial liabilities carrying floating interest. The details of long-term loans from financial institutions are set out in Note 21. The detail of the interest rate swap agreement outstanding as at 31 December 2009 is as follows: -

The Company has entered into Interest Rate Swap Transaction Agreements with an overseas bank for principal totaling USD 20 million. The contracts are for a period of 5 years, maturing in June 2009 with the condition stipulated in the agreements. At each of the maturity dates, which occur every 3 months, the Company is required to pay interest to the bank based on the rate stipulated in the agreements and the bank is required to pay interest to the Company at 3-month LIBOR of the lasted maturity date. The agreements contain other conditions. As at 31 December 2009, the Company has no outstanding credit (2008: USD 2.9 million).

As at 31 December 2009, a subsidiary has outstanding Interest Rate Swap Transaction Agreements with two overseas banks for principal totaling USD 178 million. The contracts are for a period of 3-5 years, maturing in June - October 2012 with the condition stipulated in the agreements. At each of the maturity dates, the subsidiary is required to pay interest to the bank based on the fixed rate stipulated in the agreements (1.3% - 9.0%) and the banks is required to pay interest to the subsidiary at floating rate plus stipulated rate (0.0% - 8.7%). The agreements contain other conditions. As at 31 December 2009, the subsidiary would have unrealised loss of approximately USD 34 million or Baht 1,145 million, if it recorded the above contracts at fair value.

Foreign currency risk The Company and its subsidiaries’ exposure to foreign currency risk arise mainly from trading transactions and borrowings that

are denominated in foreign currencies. The Company and its subsidiaries seek to reduce this risk by entering into forward exchange contracts when it considers appropriate. Generally, the forward contracts mature within one year.

The balances of financial assets and liabilities denominated in foreign currencies as at 31 December 2009 are summarised below.


Fixed interest rates Floating Non-interest Average within 1 year interest rate bearing Total interest rate

(Million Baht) (% per annum)

Financial assets - Cash and cash equivalents - 512 6 518 0.05 - 0.08 - Current investments 720 - - 720 0.4 - 0.6 - Trade accounts receivable - - 10,718 10,718 - - Trade accounts receivable - related parties - - 1,837 1,837 -

720 512 12,561 13,793

Financial liabilities - Short-term loans from financial institutions - 923 - 923 1.3 - 1.5 - Trade accounts payable - - 10,555 10,555 -

- 923 10,555 11,478

Financial Financial Average exchange rate Foreign currency assets liabilities as at 31 December 2009

(Million) (Million) (Baht per 1 foreign currency unit)

Due within 1 year

USD 199 269 33.37

JPY - 1,346 0.36

TWD 2 - 1.03


Currency option agreement As at 31 December 2009, a subsidiary has outstanding currency option agreements under which it will receive USD 1 million

and JPY 114 million and pay USD 1 million and JPY 114 million on maturity dates between 7 December 2011 to 7 June 2012. The subsidiary would have unrealised losses of approximately USD 3 million, or Baht 112 million, if it recorded the above contracts at fair value.

34.2 Fair values of financial instruments Since the majority of the Company and its subsidiaries’ financial instruments are short-term in nature or bear floating interest

rates, their fair value is not expected to be materially different from the amounts presented in the balance sheets. The fair value of currency option agreement, which is off balance sheet item, has details as described in Note 34.1.

A fair value is the amount for which an asset can be exchanged or a liability settled between knowledgeable, willing parties in an arm’s length transaction. The fair value is determined by reference to the market price of the financial instrument or by using an appropriate valuation technique, depending on the nature of the instrument.

35. Capital management The primary objectives of the Company’s capital management is to ensure that it has an appropriate financial structure and preserves

the ability to continue its business as a going concern. According to the balance sheet as at 31 December 2009, the Group’s debt-to-equity ratio was 1.92:1 (2008: 2.99:1) and the Company

was 0.89:1 (2008: 1.49:1). 36. Reclassification Certain amounts in the financial statements for the year ended 31 December 2008 have been reclassified to conform to the current

year’s classification but with no effect to previously reported net income or shareholders’ equity. The significant reclassification are as follow:

(Unit : Baht)

Bought Sold Contractual exchange rate

Foreign currency amount amount Bought Sold

(Million) (Million)

Subsidiaries

USD against RMB 78 78 6.57 - 6.78 6.70 - 6.85

As at 31 December 2009, the subsidiaries had the following outstanding contracts: -

Forward contracts

37. Approval of financial statements These financial statements were authorised for issue by the Company’s authorised director on 8 February 2010.

Other current assets 1,361,398,394 1,536,452,755 - -

Other non-current assets-others 230,438,387 55,384,026 - -

Administrative expenses 1,473,019,194 1,492,902,377 109,821,009 130,089,938

Loss on sale of other long-term investment - 385,746 - -

Management benefit expenses 20,268,929 - 20,268,929 -


As previously As previously As reclassified reported As reclassified reported

1 FINANCIALHIGHLIGHTS 2 MESSAGEFROMTHEBOARDOFDIRECTORS 9 BOARDOFDIRECTORS13 GENERALINFORMATION14 SHAREHOLDINGSTRUCTURE ANDMANAGEMENT15 CAPITALSTRUCTURE18 THEGROUPSTRUCTUREOFTHECOMPANY20 NATUREOFBUSINESSOPERATION24 INDUSTRYANDMARKETCOMPETITION28 RISKFACTOR30 MANAGEMENTSTRUCTURE

37 CORPORATEGOVERNANCE43 RELATEDPARTYTRANSACTIONS54 AUDITCOMMITTEEREPORT55 INTERNALCONTROL56 DIRECTORS’REPORTING57 SOCIALANDENVIRONMENTRESPONSIBILITIES60 MANAGEMENTDISCUSSIONANDANALYSIS65 REPORTOFINDEPENDENTAUDITOR66 FINANCIALSTATEMENTS73 NOTESTOCONSOLIDATED FINANCIALSTATEMENTS

CONTENTS

Cal-Comp Technology (Suzhou) Co., Ltd.

Ccet 09

Documents

total current assets

total expense

total revenue

total current liabilities

total shareholders equity

total assets turnover

net profit margin

efficiency ratios