GREEN SOLUTIONS for the FUTURE of the WORLD & MANKIND Annual Report 2010 SCC HOLDINGS BERHAD 511477-A SCC HOLDINGS BERHAD (511477-A) ANNUAL REPORT 2010 www.scc.com.my SCC HOLDINGS BERHAD (511477-A) 19 & 21, Jalan Hujan, Taman Overseas Union 58200 Kuala Lumpur, Malaysia. T : (603) 7782 8384 F : (603) 7781 8561 E : [email protected]
This document is posted to help you gain knowledge. Please leave a comment to let me know what you think about it! Share it to your friends and learn new things together.
Transcript
GREENSOLUTIONS
for the FUTURE of the
WORLD & MANKIND
Annual Report
2010SCC HOLDINGS BERHAD
511477-A
SC
C H
OLD
ING
S B
ER
HA
D (511477-A
)A
NN
UA
L RE
PO
RT 2010
www.scc.com.mySCC HOLDINGS BERHAD (511477-A)
19 & 21, Jalan Hujan, Taman Overseas Union58200 Kuala Lumpur, Malaysia.
1. PeopleWe believe in our workforce. “SCC People” have a strong work ethic, are passionate with dedication to every success, and are a bond of love and care. We are committed to expand the potential of “SCC People” through the support of continuous education & training.
2. InnovationWe continuously develop and try out new ideas and concepts in anticipation of our customers present and future needs.
3. IntegrityWe hold strongly that our business reputation is built on the honesty in all our dealings with our business partners.
4. TeamworkOur company success is highly dependent on our dynamic team with mutual understanding, respect and full participation to attain a consensus for all tasks undertaken.
5. Total Customer SatisfactionWe strive to delight our customers by providing valued quality products & services to sustain a long term business partnership.
6. Work EnvironmentWe are dedicated to upkeep a safe, clean & healthy environment in order to create a harmonious workplace which is conducive to total job efficiency.
VISIONSCC Brand Name to go globalize by year 2018
MISSIONWe are committed to meet “Total Customer Satisfaction” by continuously enhancing our “Job Competency” and “Operating System”
ContentsCorporate Profile 02
Corporate Information 03
Corporate Structure 04
Corporate Milestones 05
Board of Directors 07
Directors’ Profile 08
Chairman’s Statement 12
Statement On Corporate Governance 16
Audit Committee Report 22
Additional Compliance Information 26
Statement On Internal Control 27
Financial Statements 29
Supplementary Information 77
Analysis of Shareholdings 78
List of Properties 80
Notice of Annual General Meeting 81
Form of Proxy Enclosed
SCC HOLDINGS BERHAD I pg� (511477-A)
pg� I SCC HOLDINGS BERHAD(511477-A)
SCC Holdings Group of Companies
can trace its humble beginnings to over
38 years ago when our founders, Mr
Chee Long Sing @ Cher Hwee Seng, Mr
Cher Sew Seng and Mr Goh Ah Heng @
Goh Keng Chin founded a partnership,
Cheong Cheng Trading Co., in 1972. In
1974, a private limited company, Syarikat
Chang Cheng (M) Sdn Bhd, was formed
to take over the business. It subsequently
changed its name to SCC Corporation
Sdn Bhd (“SCC Corporation”) in 2000.
During the early days of its establishment,
SCC Corporation mainly supplied
antibiotic veterinary chemicals,
supplements, premixes as well as
growth promoters for livestock feeds,
which were imported from China, to
poultry and swine farms and feed millers
in Malaysia under its Animal Health
Products Division (“AHPD”). However,
due to the limited choices of products
from its Chinese suppliers coupled with
inconsistent supplies, SCC Corporation
began distributing products from other
countries such as USA and South Korea
since 1974.
When our founders became more
aware of the benefits of non-antibiotic
feed additives, we started distributing
non-antibiotic feed additives from USA
in 1974, in addition to antibiotic feed
additives. With greater awareness that
non-antibiotic ‘clean feed’ additives
not only promotes healthier livestock,
through elimination of mould, mycotoxin
and bacteria from feed mixtures, but also
results in safer meat, as some livestock
farmers may not observe the necessary
‘withdrawal period’ for the elimination
of antibiotic residuals in livestock which
can be passed on to the end consumers
when they consume such meat, our
founders decided to promote and adopt
their vision of ‘Clean Feed ⁄ Healthy
Livestock ⁄ Safe Food’. In line with
such vision, we started exclusively
distributing non-antibiotic feed additives
in 1990, whereby our AHPD business
model is focused on the areas of clean
feed solutions and other non-antibiotic
animal feed additives.
Our AHPD products can be sold separately
as well as through ‘programmes’ such as
our ‘clean feed’ programmes. Our ‘clean
feed’ programme is a type of dietary
programme developed specifically for
livestock where the ingredients include
but are not limited to antimicrobial and
anti-mould additives, in addition to the
normal dietary requirements such as corn
or soy. The inclusion of these ingredients
not only provides for a natural and
healthier growth of the livestock, but also
allows farmers to enjoy a better return on
their investments in the form of reduced
mortality rate, improved feed conversion
rate, reduced medication cost, improved
egg and/or meat quality, increased
growth rate and cleaner environment.
In 1978, SCC Corporation set up another
division, Food Service Equipment Division
(“FSED”), when it ventured into the
distribution of food service equipment,
which is a distinct business as compared
to AHPD. Our Founders had earlier set
up a fast food business so as to give
the company’s poultry farm customers
ideas as to how they too can venture into
the fast food industry to alleviate certain
downstream distribution problems they
were experiencing by reducing the role
of middlemen. FSED benefited from our
Founders’ foray into the fast food industry
as demand for food service equipment
increased when some of our poultry farm
customers and the public ventured into
the fast food business. As such, whilst
our FSED business is not generally
regarded as synergistic to our AHPD
business, our Founders’ involvement in
the fast food business had provided our
Group with much needed insight into the
different types of food service equipment
and the industry.
Currently, our FSED supplies and
distributes a wide range of food service
equipment and supplies, e.g., rapid
cooking ovens, pressure fryers and
popcorn ingredients, that caters to the
needs of various types of food operators
and establishments. Due to our strong
commitment, service and quality
products, we have been supplying to
some well-known hypermarkets, quick
service restaurants, cafés and cinema
chains.
In 1984, SCC Corporation began to
market and distribute powder based
vapour action anti-mould products for
animal feeds and feed ingredients which
are complementary to its core veterinary
chemicals and feed supplements
business. When more advanced liquid
based antimicrobial additives, which
employed specialised dispensing
equipment, were introduced, SCC
Corporation reorganised its antimicrobial
business by incorporating a separate
company, Anitox (M) Sdn Bhd (“Anitox
Malaysia”), in 1991. Anitox Malaysia
was incorporated to enable us to take
a more focused approach to market
and distribute the new liquid based
antimicrobial additives.
Over the years, we have been the
recipient of numerous awards for our
outstanding and distinguished service to
our clients and employees, with the most
recent being the ‘Golden Bull Award
2009’ to SCC Corporation, our 2nd
consecutive award, in recognition of our
strive for excellence in 2009. The Golden
Bull Award is organised by a leading local
Chinese newspaper, Nanyang Siang
Pau, which recognises the outstanding
achievements of 100 Malaysian SMEs.
CORPORATE
PROFILE
SCC HOLDINGS BERHAD I pg� (511477-A)
pg� I SCC HOLDINGS BERHAD(511477-A)
Board ofDirectors
Chee Long Sing @ Cher Hwee SengExecutive Chairman
Cher Sew SengManaging Director
Goh Ah Heng @ Goh Keng ChinExecutive Director
Soh Kian TeckExecutive Director
Dato’ Ismail bin HamzahIndependent Non-Executive Director
Dr. Choong Tuck Yew Independent Non-Executive Director
Dr. Goy Hong Boon Independent Non-Executive Director
Cher Lip Chun(Alternate to Chee Long Sing @ Cher Hwee Seng)
AUDIT COMMITTEEDr. Choong Tuck Yew (Chairman)Dato’ Ismail bin HamzahDr. Goy Hong Boon
NOMINATION COMMITTEEDato’ Ismail bin Hamzah (Chairman)Dr. Choong Tuck YewDr. Goy Hong Boon
REMUNERATION COMMITTEEDr. Choong Tuck Yew (Chairman)Dato’ Ismail bin HamzahChee Long Sing @ Cher Hwee Seng
COMPANY SECRETARYWong Keo Rou (MAICSA 7021435)
SHARE REGISTRAR ShareWorks Sdn Bhd (229948-U)10-1 Jalan Sri Hartamas 8Sri Hartamas, 50480 Kuala LumpurWilayah Persekutuan (KL)Tel: (603) 6201 1120Fax: (603) 6201 3121
AUDITORS Baker Tilly Monteiro Heng (AF0117)Monteiro & Heng Chambers22, Jalan Tun Sambanthan 350470 Kuala LumpurWilayah Persekutuan (KL)
REGISTERED OFFICE 10-1 Jalan Sri Hartamas 8Sri Hartamas50480 Kuala LumpurWilayah Persekutuan (KL)Tel: (603) 6201 1120Fax: (603) 6201 3121
PRINCIPAL BANKERSHong Leong Bank Berhad (97141-X)No.2-0, Lorong 2/137COff Jalan Kelang Lama58200 Kuala LumpurWilayah Persekutuan (KL)Tel : (603) 7782 0823
RHB Bank Berhad (6171-M)140 & 142, Jalan Mega MendungBandar Complex, Batu 4 1/2 Jalan Klang Lama58200 Kuala LumpurWilayah Persekutuan (KL)Tel : (603) 7983 9863
STOCK EXCHANGE LISTING ACE MarketBursa Malaysia Securities BerhadListed on 3 August 2010
ADMISSION SPONSORAlliance Investment Bank Berhad (21605-D)Level 3, Menara Multi-PurposeCapital SquareNo. 8 Jalan Munshi Abdullah50100 Kuala LumpurWilayah Persekutuan (KL)Tel : (603) 2692 7788
CORPORATE
INFORMATION
SCC HOLDINGS BERHAD I pg� (511477-A)
pg� I SCC HOLDINGS BERHAD(511477-A)
SCC HOLDINGS BERHAD I pg� (511477-A)
pg� I SCC HOLDINGS BERHAD(511477-A)
CORPORATE
STRUCTURE
100%
SCC FOODMANUFACTURING
SDN BHD(794195-W)
100%
SCC CORPORATIONSDN BHD
(17769-T)
SCC HOLDINGSBERHAD
(511477-A)
100%ANITOX (M) SDN BHD
(213921-M)
SCC HOLDINGS BERHAD I pg� (511477-A)
pg� I SCC HOLDINGS BERHAD(511477-A)
SCC HOLDINGS BERHAD I pg� (511477-A)
pg� I SCC HOLDINGS BERHAD(511477-A)
CORPORATE
MILESTONES
SCC Corporation Sdn Bhd and Anitox (M) Sdn Bhd were acquired by SCC Holdings Berhad and the group became a public listed company in the ACE Market of Bursa Malaysia Securities Berhad.
SCC Holdings Berhad acquired SCC Food Manufacturing Sdn Bhd.
SCC Corporation Sdn Bhd was ISO 9001:2008 certified Anitox (M) Sdn Bhd was awarded the Outstanding Animal Health Providers Award
SCC Corporation Sdn Bhd was awarded the Golden Bull Award for the second year
SCC Corporation Sdn Bhd was awarded the Global Emerging Knowledge Organization Award
SCC Corporation Sdn Bhd was awarded the SME 100 Award
2009
2010
SCC HOLDINGS BERHAD I pg� (511477-A)
pg� I SCC HOLDINGS BERHAD(511477-A)
CORPORATE
MILESTONES (cont’d)
SCC Corporation Sdn Bhd was awarded the Golden Bull Award
SCC Corporation Sdn Bhd was ISO 9001:2000 certified by Lloyd’s Register Quality Assurance Ltd
SCC Corporation Sdn Bhd was awarded Innovative Human Capital Development Award
SCC Corporation Sdn Bhd was awarded the SMI Business of the Year Award
SCC Corporation Sdn Bhd was awarded the Outstanding Animal Health Providers Award
2005
2008
2004
SCC HOLDINGS BERHAD I pg� (511477-A)
pg� I SCC HOLDINGS BERHAD(511477-A)
BOARD OF
DIRECTORS
From left to right:
Soh Kian TeckExecutive Director
Dr. Choong Tuck Yew Independent Non-Executive Director
Dato’ Ismail bin HamzahIndependent Non-Executive Director
Chee Long Sing @ Cher Hwee SengExecutive Chairman
Cher Sew SengManaging Director
Goh Ah Heng @ Goh Keng ChinExecutive Director
Cher Lip Chun(Alternate to Chee Long Sing @ Cher Hwee Seng)
Dr. Goy Hong Boon Independent Non-Executive Director
SCC HOLDINGS BERHAD I pg� (511477-A)
pg� I SCC HOLDINGS BERHAD(511477-A)
SCC HOLDINGS BERHAD I pg� (511477-A)
pg� I SCC HOLDINGS BERHAD(511477-A)
DIRECTORS’
PROFILE
Mr Ben Cher was appointed to our Board on 17 April 2000
and was appointed as Executive Chairman and member of the
Remuneration Committee on 1 April 2010. He is responsible
for our Group’s business development activities. He is a co-
founder of the Group. In 1971, he co-founded a partnership,
Cheong Cheng Trading Co. in 1972, which was engaged in the
provision of animal health products. In 1974, a private limited
company, Syarikat Chang Cheng (M) Sdn Bhd, was formed to
take over the business, which subsequently changed its name
to SCC Corporation. He was appointed as the Managing
Director in 1974 before being appointed to Executive Chairman
in 1988. Mr Cher has more than 33 years of experience in the
animal health products and food service equipment industries.
He is the elder brother of Mr Francis Cher and is the father of
Mr Adam Cher.
Mr Francis Cher was appointed to our Board on 17 April 2000
and was appointed as Managing Director on 1 April 2010. Mr
Francis Cher is a co-founder of the the Group. He is responsible
for the overall business strategies and management. He joined
Cheong Cheng Trading Co. as a Sales Executive in 1972. Later
in 1974, a private limited company, Syarikat Chang Cheng
(M) Sdn Bhd, was formed to take over the business, which
subsequently changed its name to SCC Corporation. He was
appointed as a Director in 1976 before being appointed to
Managing Director in 1988. Mr Francis Cher has more than
33 years of experience in the animal health products and food
service equipment industries. He is the younger brother of Mr
Ben Cher.
Chee Long Sing @ Cher Hwee Seng (Ben Cher) Malaysian, aged 67Executive Chairman
Cher Sew Seng (Francis Cher) Malaysian, aged 61Managing Director
SCC HOLDINGS BERHAD I pg� (511477-A)
pg� I SCC HOLDINGS BERHAD(511477-A)
SCC HOLDINGS BERHAD I pg� (511477-A)
pg� I SCC HOLDINGS BERHAD(511477-A)
Mr Goh was appointed to our Board on 1 April 2010 and is our
Executive Director. Mr Goh is a co- founder of the Group. He is
responsible for the sales, marketing and overall management
of our AHPD. In 1971, he co-founded Cheong Cheng Trading
Co. in 1972. In 1974, a private limited company, Syarikat Chang
Cheng (M) Sdn Bhd, was formed to take over the business,
which subsequently changed its name to SCC Corporation.
Mr Goh was appointed as a Director in 1976 before being
appointed to Sales Director in 1982. Mr Goh has more than
33 years of experience in the animal health products and food
service equipment industries.
Mr Soh was appointed to our Board on 1 April 2010 and is our
Executive Director. Mr Soh is responsible for the accounts and
financial management of our Group. He obtained his Bachelor
of Commerce (Accountancy) from Nanyang University in
1974 and is a member of Malaysian Institute of Accountants
and CPA Australia. In 1978, he joined SCC Corporation as
an Accounts Executive. In 2007, he was promoted to Senior
Accounts Manager.
Goh Ah Heng @ Goh Keng Chin, Malaysian, aged 65
Executive Director
Soh Kian Teck, Malaysian, aged 63
Executive Director and Senior Accounts Manager
DIRECTORS’
PROFILE (cont’d)
SCC HOLDINGS BERHAD I pg11 (511477-A)
pg10 I SCC HOLDINGS BERHAD(511477-A)
SCC HOLDINGS BERHAD I pg11 (511477-A)
pg10 I SCC HOLDINGS BERHAD(511477-A)
Dato’ Ismail was appointed to our Board on 1 April 2010 and
is our Independent Non-Executive Director. Dato’ Ismail was
also appointed as the Chairman of Nomination Committee and
member of Audit Committee and Remuneration Committee on
1 April 2010. Dato’ Ismail obtained his Bachelor of Economics
(Hons) in Analytical Economics from University of Malaya in
1970. Upon graduation, he joined the Administrative and
Diplomatic Service and served Ministry of Finance as an
Assistant Secretary. He has over 30 years of experience in
economics and finance which he acquired from his previous
key positions held in several Malaysian governmental agencies.
Dato’ Ismail is also the Independent Non-Executive Director
of FCW Holdings Berhad, PDZ Holdings Berhad and GUH
Holdings Berhad as well as the Independent Non-Executive
Chairman of Engtex Group Berhad.
Dr. Choong Tuck Yew was appointed to the Board of the Company on 1 April 2010 as an Independent Non-Executive Director. He is the Chairman of the Audit and the Remuneration Committees and a member of the Nomination Committee. Dr. Choong who possesses a DComSc and a MBA, is a Chartered Accountant (MIA) as well as a member of the Malaysian Institute of Certified Public Accountants. He is also a Fellow of CPA Australia, the Malaysian Institute of Chartered Secretaries and Administrators, Chartered Tax Institute of Malaysia, and a Chartered Fellow, as well as, a Chartered Audit Committee Director of the Institute of Internal Auditors Malaysia.
In the early years of his career, Dr. Choong worked as an Accountant in several private companies prior to his joining Bank Negara Malaysia (The Central Bank of Malaysia) in 1968. In 1987, he was promoted as the Chief Manager in charge of supervising all the branches of Bank Negara Malaysia. In 1990, he was seconded by Bank Negara Malaysia as the Managing Director of Visia Finance Berhad, a licensed finance company.Currently, Dr. Choong is the Independent Non-Executive Chairman of OSK Investment Bank Berhad. He is also the Deputy Chairman of C&C Investigation Services Sdn. Bhd., a licensed private investigation agency approved by the Malaysian Ministry of Home Affairs.
In addition, he is also the Senior Independent Non-Executive Director of Poh Kong Holdings Berhad, an Independent Non-Executive Director of OSK-UOB Unit Trust Management Berhad and OSK-UOB Islamic Fund Management Berhad. Presently, Dr. Choong is the Vice-President of the Malaysian Institute of Directors and the Ambassador representing the World Association of Detectives in Malaysia. He has been a guest speaker at various conferences in Malaysia as well as abroad.
Dato’ Ismail Bin Hamzah, Malaysian, aged 65Independent Non-Executive Director
Dr Choong Tuck Yew, Malaysian, aged 72Independent Non-Executive Director
DIRECTORS’
PROFILE (cont’d)
SCC HOLDINGS BERHAD I pg11 (511477-A)
pg10 I SCC HOLDINGS BERHAD(511477-A)
SCC HOLDINGS BERHAD I pg11 (511477-A)
pg10 I SCC HOLDINGS BERHAD(511477-A)
Dr. Goy was appointed to our Board on 1 April 2010 and is our Independent Non-Executive Director and member of Audit Committee and Nomination Committee. He has more than 15 years of experience in the field of equity capital market and information technology sectors. He begins his career with a leading International Investment Bank as a Corporate Finance Manager in 1995, and last held position as Head of Corporate Finance unit. He then moved on to a leading local securities firm as Vice President for Business Development and Corporate Advisory. Thereafter, he pursues his profession as consultant and advising companies on Mergers & Acquisitions, corporate restructurings and project financing. He graduated with Bachelor of Business Administration from American Intercontinental University of London in 1992 and Master of Business Administration (Finance) from Oklahoma City University in 1994. He holds a Doctorate in Business Administration from Northwest University in 2003. He is also member of Chartered Audit Committee Director from Institute of The Institute of Internal Auditors Malaysia. He holds a Master of Financial Professional (MFP) certification from American Academy of Financial Management.
Mr Adam Cher was appointed as Alternate Director to Chee
Long Sing @ Cher Hwee Seng on 1 April 2010. Mr Adam
Cher is responsible for assisting the Executive Chairman in the
overall administrative and business development activities of
our Group, and attends all Board and management meetings,
where possible. He obtained his Bachelor of Business
(Marketing/International Business Management) from Charles
Sturt University, Australia in 2002. In 2005, he joined SCC
Corporation as a FSED Assistant Marketing Manager, where
he was responsible for the management of FSED’s key
customers. In 2008, he was promoted to Personal Assistant to
the Executive Chairman and Business Development Manager
of the Group, for both AHPD and FSED. He is the son of Mr
Ben Cher.
Dr Goy Hong Boon, Malaysian, aged 39
Independent Non-Executive Director
Cher Lip Chun (Adam Cher)Malaysian, aged 35
Alternate Director to Chee Long Sing @ Cher Hwee Seng
Other Information
a. Conflict of Interest
None of the Directors has any conflict of interest with SCC Holdings Bhd.
b. Conviction of Offences
None of the Directors has been convicted for any offences within the past 10 years other than traffic offences, if any.
DIRECTORS’
PROFILE (cont’d)
SCC HOLDINGS BERHAD I pg1� (511477-A)
pg1� I SCC HOLDINGS BERHAD(511477-A)
Chee Long Sing @ Cher Hwee Seng (Ben Cher)Executive Chairman
chairman’s
STATEMENT
SCC HOLDINGS BERHAD I pg1� (511477-A)
pg1� I SCC HOLDINGS BERHAD(511477-A)
OVERVIEW
Firstly, I am pleased with the moderate
performance of SCC Group for the
financial year under review, despite
the residual impact from the global
economic downturn since year 2008.
However, SCC has taken this opportunity
to equip and consolidate all its
resources and networks in preparation
for foreseeable recovery in the near
future with their listing on August 2010,
to strengthen the company’s financial
position with public subscription of
about RM 9 mil in total.
As stated in the company’s prospectus,
part of the funds raised would be utilized
for necessary capital expenditure
and enhance green feed mixtures
developments, in order to strengthen
the Group’s product positioning as
well as potential penetration of new
markets.
In addition, the Group had acquired SCC
Food Manufacturing (M) Sdn. Bhd. on
27 August 2010, which was equipped
with production facilities of fun food raw
materials. As there is a huge market for
Halal products in our region and under
the Management’s encouragement,
this subsidiary company had obtained
‘Halal’ certification from JAKIM on 16
February, 2011.
The outlook for both green feed
production and foodservice equipment
sectors for 2011 will remain challenging,
but there are higher demands for quality
meat and hygienically prepared food by
consumers.
We will continue to promote our
green feed solutions and foodservice
equipment which are cost effective,
energy saving and environmental
friendly as we go on a green journey to
integrate environmental sustainability
into our business.
FINANCIAL HIGHLIGHTS
For the financial year ended 31
December 2010, the Group recorded a
consolidated revenue of RM 19.3 million,
whilst consolidated profit before tax was
RM7.1 million, and consolidated profit
after tax was RM5.9 million (inclusive of
negative goodwill of RM3.8 million).
DIVIDENDS
On 25 November 2010, the Group
declared an interim tax exempt (single
tier) dividend of 1 sen per ordinary
share, which was subsequently paid
to shareholders on 30 December,
2010. As envisaged in the company’s
prospectus dated 30 June 2010.
the Board of Directors is pleased to
On behalf of the Board of Directors, I have the pleasure of presenting to you the Annual Report and the Audited Financial Statements of SCC Holdings Berhad for the financial year ended 31 December, 2010. This is our first annual report since SCC Holdings Bhd was listed on Bursa Malaysia securities berhad on 3 August 2010.
DEAR SHAREHOLDERS,
SCC HOLDINGS BERHAD I pg1� (511477-A)
pg1� I SCC HOLDINGS BERHAD(511477-A)
SCC HOLDINGS BERHAD I pg1� (511477-A)
pg1� I SCC HOLDINGS BERHAD(511477-A)
recommend a final tax exempt (single
tier) dividend of 4 sen per ordinary
share for the financial year ended 2010,
translating into an aggregate dividend
payout ratio of approximately 36% of the
PAT for the financial year under review.
Nevertheless, the said final dividend
is subject to the final shareholders’
approval in the forthcoming Annual
General Meeting.
FUTURE PROSPECTS
Barring unforeseen circumstances,
SCC anticipates certain level of
recovery for both green feed production
and foodservice equipments moving
forward.
We are determined to remain competitive
notwithstanding the challenges and we
are working towards more joint venture
or strategic partnering with overseas or
local related industry players, for more
innovative products to the regional
market.
As stated in Malaysia Agribusiness
Report Q1 2011, “The poultry sector is
likely to be one of Malaysia’s key focus
points given its professed aim to become
a halal food hub. As a predominately
Muslim country, the Malaysian
government believes it is perfectly
placed to become a key food supplier
to other Muslim countries, who will be
confident that Malaysia’s food exports
will be prepared to halal standards -
the proposition of an integrated halal
poultry production centre further boosts
the country in reaching that goal.”
Although the outlook remain challenging,
the Group is confident of securing better
operational performance with expected
increase in demands for quality meat
and hygienically prepared food by
consumers.
Moving forward, the Group will
continue its effort in promotion of the
green feed solutions, working towards
the Group’s vision of healthy meat
supplies in the whole nation, for the
benefit of consumers at large as well
as our future generations. Whereas for
foodservice equipment division, the
Group will work towards our mission of
cost effectiveness, energy saving and
environmental friendly policies towards
green journey to integrate environmental
sustainability into our business.
CHAIRMAN’S
STATEMENT (cont’d)
Moving forward,
the Group will continue its effort
in promotion of the green feed
solutions, working towards the
company’s vision of healthy meat
supplies in the whole nation, for the
benefit of consumers at large as
well as our future generations.
SCC HOLDINGS BERHAD I pg1� (511477-A)
pg1� I SCC HOLDINGS BERHAD(511477-A)
SCC HOLDINGS BERHAD I pg1� (511477-A)
pg1� I SCC HOLDINGS BERHAD(511477-A)
We are also recruiting talented new
hires to accelerate productivities and
drive business growth and expand our
market share with new customers in our
existing markets.
CORPORATE SOCIAL RESPONSIBILITY (CSR)
In Bursa Malaysia Corporate Social
Responsibility Framework, corporate
social responsibility is defined as “open
and transparent business practices that
are based on ethical values and respect
for the community, employees, the
environment, shareholders and other
stakeholders. It is designed to deliver
sustainable value to society at large”.
The SCC Group had already subscribed
to the notion of conducting its business in
an ethically, socially and environmentally
sustainable manner which is embodied
in its long held corporate philosophy.
Making a positive contribution to the
community and in the true spirit of
Wesak Day, SCC staff turned up early
at the temple nearby the office with the
necessary equipments and ingredients
to prepare free caramel popcorn,
cotton candy and beverages to those
who participated in the event.
In conjunction with Angels’ Children
Home’s fund-raising event to support
the orphanage’s daily expenses, we
participated by sponsoring fun food
such as caramel popcorn, cotton
candy and beverages.
We are pleased to extend our assistance
when the need arises, as a caring
and socially responsible corporate
citizen. SCC is ever ready to support
in any community-oriented initiatives to
promote a culture of caring especially to
the underprivileged to promote greater
harmony for 1Malaysia.
ACKNOWLEDGEMENT AND APPRECIATION
On behalf of the Board of Directors, we
would like to express our sincere thanks
and gratitude to Mr. Soh Kian Teck, an
Executive Director who will not seek
re-election at the forthcoming Annual
General Meeting.
Finally, on behalf of the Board of
Directors, I would like to extend our
sincere appreciation to shareholders,
the various regulatory authorities, our
valued guests/clients and business
asociates for their unending support,
confidence and trust. I must also take
this opportunity to express our thanks
to management and staff across the
Group whose contribution has once
again been significant in th development
of the business and for their commitment
and enthusiasm towards ensuring the
delivering of quality services to our
guests/clients.
CHER HWEE SENG
Executive Chairman
SCC HOLDINGS BERHAD I pg1� (511477-A)
pg1� I SCC HOLDINGS BERHAD(511477-A)
STATEMENT ON
CORPORATE GOVERNANCE The Board is committed to ensure that the highest standards
of Corporate Governance are practiced throughout the Group
as a fundamental part of discharging its responsibilities to
protect and enhance shareholders’ value and the financial
performance of the Group. The Board is fully committed in
ensuring that the Group adopts, so far as it is practicable, the
Principles and Best Practices set out in the Malaysian Code on
Corporate Governance (“Code”).
The following statement set out the Group’s compliance with
the Principles of the Code:-
1. DIRECTORS
1.1 The Board
The Group is led and managed by a well balanced
Board which consists of members with a wide and
varied range of business, technical and financial
background.
In carrying out its functions, the Board has delegated
specific responsibilities to the Board Committee to
scrutinise particular issues and report to the Board
with their recommendations. However, the ultimate
responsibilities for the final decisions on all matters
still lie with the entire Board.
The Board Committee have written terms of
reference and procedures, and the Board receives
report of their proceedings and deliberations. The
Chairman of the Board Committee will report to
the Board on the outcome of the Board Committee
meeting and such reports will be incorporated in the
minutes of the full Board Meeting.
The Board has established the Audit Committee,
Nomination Committee and Remuneration
Committee to assist the Board in the execution of its
responsibilities. All Committees have clearly defined
terms of reference. The Chairman of the various
committees will report to the Board the outcome of
the committee meetings.
1.2 Board Balance
The Board as at the date of this statement comprises
eight (8) members:-
(i) One (1) Executive Chairman
(ii) One (1) Managing Director
(iii) Two (2) Executive Directors
(iv) Three (3) Non-Executive Directors
(v) One (1) Alternate Director
All three (3) Non-Executive Directors are Independent
as defined in the Listing Requirements of Bursa
Malaysia Securities Berhad for the ACE Market. The
Independent Directors are:-
1) Dato’ Ismail bin Hamzah
2) Dr. Choong Tuck Yew
3) Dr. Goy Hong Boon
The roles of the Chairman, Chee Long Sing @
Cher Hwee Seng and the Managing Director, Cher
Sew Seng are separate with clear distribution of
responsibilities between them to provide effective
leadership of the Board and the Group.
The Chairman leads strategic planning at the
Board level whilst the Managing Director and
Executive Directors are generally responsible for the
implementation of the policies laid down and making
executive and investment decisions.
The Independent Non-Executive Directors have the
necessary calibre to provide independent judgement
on the issues of strategy, performance, allocation of
resources and standards of conducts.
The Board is satisfied that the current Board
composition is fairly balanced to ensure the long-
term interest of the shareholders, employees,
customers and other stakeholders.
1.3 Supply of Information
The Board meets regularly on a quarterly basis and
as and when required. During the financial year
under review, the Board held two (2) meetings. A
summary of the attendance of each Director at the
Board meetings held during the financial year under
review are as follows:-
Name of Directors Meetings Percentage of attended attendance (%)
Chee Long Sing @ Cher Hwee Seng 2/2 100
Cher Sew Seng 2/2 100
Goh Ah Heng @ Goh Keng Chin 2/2 100
Soh Kian Teck 2/2 100
Dato’ Ismail bin Hamzah 2/2 100
Dr. Choong Tuck Yew 2/2 100
Dr. Goh Hong Boon 2/2 100
Cher Lip Chun (Alternate Director) 2/2 100
Prior to each Board meeting, the notice of meetings and Board papers on matters including the Group’s quarterly financial performance report, strategic direction and investments plan for the Group will be sent to the Directors, to give them sufficient time to deliberate on the issues to be raised at the meetings and also to enable them to obtain further explanations, where necessary, in order to be briefed properly before the meeting.
During the Board meetings, the Board shall discuss and deliberate on a formal agenda and schedule of matters arising for approval and notation. All deliberations and conclusion of the Board are clearly and accurately recorded by the Company Secretary. The minutes are then confirmed by the Board and signed as correct records of proceedings there by the Chairman.
The Directors are also regularly updated and advised on new regulations, guidelines or directives issued by Bursa Malaysia Securities Berhad, Securities Commission and other regulatory authorities.
All Board members have access to the advice and services of the Company Secretary. The appointment of the Company Secretary is based on the capability and proficiency determined by the Board. The Company Secretary is responsible for ensuring the procedures for the Board meetings are
followed and that applicable rules and regulations are complied with.
The Directors may seek external independent professional advice as and when necessary in furtherance of their duties, at the Company’s expense, to enable them to make well informed decisions. Before incurring such professional fees, the Directors concerned must consult with the Chairman of the Board.
In addition, the Board may invite the senior management to brief the Board from time to time on matters being deliberated.
1.4 Board CommitteesIn line with the Best Practices of the Code, the Board has set up an Audit Committee, Nomination Committee and Remuneration Committee. The Audit Committee Report is set out on the pages 22 to 25 of this Annual Report.
Nomination Committee
The Nomination Committee (NC) was established to assist the Board in discharging its duties and responsibilities.
The NC comprises entirely of Non-Executive Directors as follows:-
STATEMENT ON
CORPORATE GOVERNANCE (cont’d)
SCC HOLDINGS BERHAD I pg1� (511477-A)
pg1� I SCC HOLDINGS BERHAD(511477-A)
No. Name Designation
1. Dato’ Ismail bin Hamzah Chairman, Independent Non-Executive Director
2. Dr. Choong Tuck Yew Member, Independent Non-Executive Director
3. Dr. Goy Hong Boon Member, Independent Non-Executive Director
SCC HOLDINGS BERHAD I pg1� (511477-A)
pg1� I SCC HOLDINGS BERHAD(511477-A)
SCC HOLDINGS BERHAD I pg1� (511477-A)
pg1� I SCC HOLDINGS BERHAD(511477-A)
The NC is empowered by the Board and its terms of reference are as follows:-
• To recommend to the Board of Directors, candidates for all directorships to be filled by the shareholders or the Board.
• To consider, in making its recommendations, candidates for directorships proposed by the Executive Directors/Chief Executive Director and within the bounds of practicability, by any other senior executive or any director or shareholder.
• To recommend to the Board, directors to fill the seats on board committees.
• To review and report to the Board on an annual basis, the Board’s required mix of skills and
experience and other qualities, including core competencies which non-executive directors should bring to the Board.
• To ensure, on an annual basis, the implementation of a process for assessing the effectiveness of the Board as a whole, the committees of the Board and for assessing the contribution of each individual director.
Remuneration Committee
The Remuneration Committee (RC) was established to assist the Board in discharging its duties and responsibilities.
The RC comprises of the following:-
STATEMENT ON
CORPORATE GOVERNANCE (cont’d)
No. Name Designation
1. Dr. Choong Tuck Yew Chairman, Independent Non-Executive Director
2. Dato’ Ismail bin Hamzah Member, Independent Non-Executive Director
3. Chee Long Sing @ Cher Hwee Seng Member, Executive Chairman
The RC is empowered by the Board and its terms of reference are as follows:-
• To recommend to the Board the remuneration of the executive directors in all its forms drawing from outside advice as necessary.
• To review the Group Policy on remuneration of Directors of the subsidiaries and to recommend the remuneration of the Directors to the Board.
The remuneration of the Executive Directors is structured as to link rewards to corporate and individual performance. In the case of non-Executive Directors, the level of remuneration reflects the expertise, experience and level of responsibilities undertaken by the particular Non-Executive Director concerned. The Board determines the remuneration of Non-Executive Directors, and each individual Director abstains from the Board decision pertaining to his own remuneration.
1.5 Appointments to the BoardThe Code endorses, as a good practice, a formal procedure for appointments to the Board.
The Board, currently, appoints its members through a formal and transparent selection process which is consistent with the Articles of Association of the Company. This process has been reviewed, approved and adopted by the Board as a whole. New appointees will be considered and evaluated by the Board and the Company Secretary will ensure that all appointments are properly made and that legal and regulatory obligations are met.
The NC also annually reviews the effectiveness of the Board as a whole, its committees and the contribution of each individual Director as well as Managing Director. The NC will ensure that all assessments and evaluations carried out are properly documented and filed.
SCC HOLDINGS BERHAD I pg1� (511477-A)
pg1� I SCC HOLDINGS BERHAD(511477-A)
SCC HOLDINGS BERHAD I pg1� (511477-A)
pg1� I SCC HOLDINGS BERHAD(511477-A)
No. Name Programme
1. Chee Long Sing @ Cher Hwee Seng Mandatory Accreditation Programme
2. Cher Sew Seng Mandatory Accreditation Programme
5. Dato’ Ismail bin Hamzah Corporate Integrity Systems Malaysia
Beyond Governance, Enter Sustainability
Statement on Risk Management and Internal Control
Stroking the fire of Corporate Governance
Board Role, Directors Duties & Blind Spots, Biases & Other
Pathologies in the Boardroom
6. Dr. Choong Tuck Yew Board Effectiveness : Redefining the Roles and Functions of An
Independent Director
Board Effectiveness: Understanding The Roles and Responsibilities
of The Nominating and Remuneration Committees
7. Dr. Goy Hong Boon Board Effectiveness : Redefining the Roles and Functions of An
Independent Director
Board Effectiveness: Understanding The Roles and Responsibilities
of The Nominating and Remuneration Committees
8. Cher Lip Chun Mandatory Accreditation Programme
Learn Together, Grow Together
Gold Medal Products Co. 2010 Distributor Conference for Sales and
Technical Training
STATEMENT ON
CORPORATE GOVERNANCE (cont’d)
1.6 Directors’ TrainingAll Directors have attended and successfully completed the Mandatory Accreditation Program as prescribed by the Bursa Securities ACE Market Listing Requirements. The Directors have and shall continue to attend the relevant seminars, trainings and workshops on an annual basis to further
enhance and update their skills and knowledge and to keep abreast with developments in the dynamic business environments.
Training programmes attended by the Directors during the financial year ended 31 December 2010 are as follows:-
1.7 Re-electionIn accordance with the Company’s Article of Associations, one third (1/3) of the Board, shall retire from office and be eligible for re-election at each Annual General Meeting and all the directors shall retire from office once in every three (3) years but shall be eligible for re-election.
Directors appointed by the Board during the financial year shall be subject to retirement and re-election by shareholders in the next Annual General Meeting held
following their appointments. Directors over seventy (70) years of age are required to submit themselves for re-appointment annually in accordance with Section 129(6) of the Companies Act, 1965.
The election of each Director is voted on separately. To assist shareholders in their decision, sufficient information such as personal profile, meetings attendance and the shareholdings in the Group of each Director standing for election are furnished.
SCC HOLDINGS BERHAD I pg�1 (511477-A)
pg�0 I SCC HOLDINGS BERHAD(511477-A)
SCC HOLDINGS BERHAD I pg�1 (511477-A)
pg�0 I SCC HOLDINGS BERHAD(511477-A)
�. DIRECTORS’ REMUNERATION
2.1 The Level and Make-up of Remuneration
In the case of Executive Directors, the component
parts of remuneration are structured so as to link
rewards to corporate and individual performance.
In the case of Non-Executive Directors, the level of
remuneration reflects the experience and level of
responsibilities undertaken by the particular non-
executive concerned. No Director, Executive or
Non-Executive, shall make the decisions pertaining
The number of Directors whose total remuneration falls into the respective bands is as follows:-
No. of Directors
Band of Remuneration Executive Directors Non-Executive Directors Total
Below RM50,000 - 3 3
RM 50,001 - RM100,000 1 - 1
RM101,000 - RM200,000 - - -
RM201,000 - RM250,000 - - -
RM250,001 - RM300,000 1 - 1
RM300,001 - RM350,000 1 - 1
RM350,001 - RM400,000 1 - 1
4 3 7
The disclosure of directors’ remuneration is made in
accordance with Appendix 9C, item 10 of the Bursa
Malaysia Securities Berhad’s Listing Requirements.
This method of disclosure represents a deviation
from the Best Practices set out in the Code, which
suggests separate disclosure of each director’s
remuneration. The Board of Directors is of the
opinion that separate disclosure will impinge upon
the directors’ right of privacy.
�. SHAREHOLDERS
3.1 Dialogue between the Company and Investors
The Board recognises the importance of keeping
the shareholders and investors informed of the
Group’s business and corporate developments. Such
information is disseminated via the Group’s annual
reports, circulars to shareholders, quarterly financial
results and the various prescribed announcements
made to Bursa Securities from time to time in the Bursa
Securities’ website at www.bursamalaysia.com.
In addition, the Group has established a website at
www.sccholdings.com to provide public access to
Group information and business activities.
3.2 Annual General Meeting (AGM)The AGM is the principal forum for dialogue with the shareholders. Shareholders are notified of the meeting and provided with a copy of the Company’s annual report twenty one (21) days before the meeting. At each AGM, the shareholders have direct
SCC HOLDINGS BERHAD I pg�1 (511477-A)
pg�0 I SCC HOLDINGS BERHAD(511477-A)
SCC HOLDINGS BERHAD I pg�1 (511477-A)
pg�0 I SCC HOLDINGS BERHAD(511477-A)
3.2 Annual General Meeting (AGM) (continued)access to the Board and are encouraged to participate in the open question and answer session. The Chairman and Directors are in attendance to respond to the shareholders’ queries during the meeting.
The external auditors are also present to provide professional and independent clarification on issues and concerns raised by the shareholders during the meeting.
�. ACCOUNTABILITY AND AUDIT
4.1 Financial ReportingThe Board aims to provide and present a balanced, clear and meaningful assessment of the Group’s financial position and prospects, primarily through the annual financial statements, quarterly results announcements to Bursa Securities and the annual report to the shareholders. The Audit Committee assists the Board in scrutinising information for disclosure to ensure accuracy and completeness.
4.2 Internal ControlA Statement on Internal Control which provides an overview of the state of internal controls within the Group is disclosed on page 27-28 of this Annual Report.
4.3 Relationship with the Auditors
The Group’s independent external auditors fill an essential role by enhancing the reliability of the Group’s financial statements and giving assurance of the reliability to users of these financial statements. The Group has always maintained an independent, formal and transparent relationship with its external auditors in seeking professional advice and ensuring compliance with the accounting standards in Malaysia.
The Board may seek the external auditors’ professional advice in ensuring compliance with appropriate accounting standards.
�. STATEMENT OF DIRECTORS’ RESPONSIBILITY FOR PREPARING THE FINANCIAL STATEMENTS
The Directors are required by the Companies Act, 1965 and the Listing Requirements of Bursa Malaysia Securities
Berhad to prepare the financial statements for each financial year which have been made out in accordance with the applicable Malaysian Accounting Standards Board approved accounting standards in Malaysia and to give a true and fair view of the state of affairs of the Group and of the Company at the end of the financial year, and of the results and cash flows of the Group and of the Company for the year then ended.
In preparing the financial statements, the Directors have taken the necessary steps and actions as follows:-
• selected suitable accounting policies and applied them consistently;
• made judgements and estimates that are prudent and reasonable;
• ensured that all applicable accounting standards have been followed; and
• prepared financial statements on a going concern basis as the Directors have a reasonable expectation, having made the necessary enquiries, that the Group and Company have adequate resources to continue in operational existence for the foreseeable future.
The Directors have the responsibility in ensuring that the Company keeps accounting records which disclose with reasonable accuracy the financial position of the Group and Company and which enable them to ensure that the financial statements comply with the Companies Act, 1965, Bursa Malaysia Securities Berhad’s Listing Requirements, and are prepared in accordance with the applicable approved accounting standard.
The Directors have the overall responsibilities for taking such steps are reasionably open to them to safeguard the assets of the Group and to prevent and detect fraud and other irregularities.
STATEMENT ON THE EXTENT OF COMPLIANCE WITH THE BEST PRACTICES IN CORPORATE GOVERNANCE SET OUT IN PART � OF THE CODE
The Board considers that the Group has substantially complied with the Best Practices as stipulated in Part 2 of the Code throughout the financial year ended 31 December 2010.
STATEMENT ON
CORPORATE GOVERNANCE (cont’d)
SCC HOLDINGS BERHAD I pg�� (511477-A)
pg�� I SCC HOLDINGS BERHAD(511477-A)
SCC HOLDINGS BERHAD I pg�� (511477-A)
pg�� I SCC HOLDINGS BERHAD(511477-A)
AUDIT COMMITTEE
REPORTMEMBERS OF THE AUDIT COMMITTEE
The Audit Committee of the Company comprises the following
members:-
Dr. Choong Tuck Yew
Chairman, Independent Non-Executive Director
Dato’ Ismail bin Hamzah
Member, Independent Non-Executive Director
Dr. Goy Hong Boon
Member, Independent Non-Executive Director
TERMS OF REFERENCE OF THE AUDIT COMMITTEE
The terms of reference of the Audit Committee are as follows:-
2.1 Objectives
The objectives of the Audit Committee are:-
ii. to relieve the full Board of Directors from detailed
involvement in the review of the results of internal
and external audit activities and to ensure that
audit findings are brought up to the highest level for
consideration.
ii. to comply with Bursa Securities ACE Market Listing
Requirements (“ACE LR”) and other specified
financial standards and required disclosure policies
developed and administered by Bursa Securities.
iii. to ensure consistency with Bursa Securities’s
commitment to encourage high standards of
corporate disclosure.
2.2 Composition of the Audit Committee
The Audit Committee shall be appointed by the Board
amongst its member and which shall fulfill the following
requirements:-
i. the audit committee must be composed of not fewer
than three (3) members;
ii. all members must be Independent Non-Executive
Directors;
iii. the members of the Audit Committee shall elect a
Chairman from among themselves who shall be an
Independent Director; and
iv. at least one (1) member of the audit committee:-
a) must be a member of the Malaysian Institute of
Accountants (MIA); or
b) if he is not a member of the MIA, he must have at
least 3 years’ working experience and
• he must have passed the examinations
specified in Part 1 of the 1st Schedule of
the Accountants Act, 1967; or
• he must be a member of one of the
associations of accountants specified in Part
II of the 1st Schedule of the Accountants
Act, 1967; or
• fulfils such other requirements as prescribed
or approved by Bursa Securities.
If a member of the Committee resigns, dies or for any
other reason ceases to be a member with the result that
the number of members is reduced to below three (3),
the Board of Directors shall, within three (3) months of
that event, appoint such number of new members as
may be required to make up the minimum number of
three (3) members.
2.3 Chairman of the Audit Committee
The Chairman of the Audit Committee shall be an
Independent Director.
2.4 Secretary to the Audit Committee
The Company Secretary shall be the Secretary of the
Committee.
2.5 Quorum
The majority of members present must be Independent
Directors to form a quorum.
pg�� I SCC HOLDINGS BERHAD(511477-A)
SCC HOLDINGS BERHAD I pg�� (511477-A)
pg�� I SCC HOLDINGS BERHAD(511477-A)
SCC HOLDINGS BERHAD I pg�� (511477-A)
pg�� I SCC HOLDINGS BERHAD(511477-A)
2.6 Duties of the Audit Committee
The duties of the Audit Committee shall be:-
i. to consider the external auditors for appointment,
audit fees and review any letter of resignation or
dismissal and proposal for re-appointment of external
auditors or whether there is reason (supported by
grounds) to believe that the external auditors are not
suitable for re-appointment.
ii. to discuss with the external auditor before the audit
commences, the nature and scope of the audit, and
ensure co-ordination where more than one audit firm
is involved.
iii. to review:-
a) with the external auditors, the audit plan;
b) with the external auditors, their evaluation of the
system of internal controls;
c) with the external auditors, their audit report;
d) the assistance given by the Company’s officer to
the external auditors;
e) any appraisal or assessment of the performance
of member of the internal audit function;
f) the quarterly results and year end financial
statements, prior to the approval by the Board of
Directors, focusing particularly on:-
• changes in or implementation of major
accounting policy changes;
• significant and unusual events;
• the going concern concept; and
• compliance with accounting standards and
other legal requirements;
g) any related party transaction and conflict of interest
situation that may arise within the Company or
the Group including any transaction, procedure
or course of conduct that raises questions of
management integrity;
h) the external auditor’s management letter and
management’s response.
iv. to review and discuss problems and reservations
arising from the interim and final audits and any
matter the external auditors may wish to discuss (in
the absence of management where necessary).
v. to do the following where an internal audit function
exists:-
a) review the adequacy of the scope, functions,
competency and resources of the internal audit
functions and that it has the necessary authority
to carry out its work;
b) review the internal audit programme, processes,
the results of the internal audit programme,
processes or investigation undertaken and
whether or not appropriate action is taken on the
recommendations of the internal audit function;
c) review any appraisal or assessment of the
performance of members of the internal audit
function;
d) approve any appointment or termination of senior
staff members of the internal audit function;
e) inform itself of resignations of senior staff
members of the internal audit function and
provide the resigning staff member an opportunity
to submit his reasons for resigning.
vi. to assist the Board to discharge its statutory duties
and responsibilities.
vii. to ensure proper implementation and recommend
appropriate remedial and corrective measures in
respect of such findings arising from inspections
conducted by the regulators.
viii. to monitor the Company’s compliance with
applicable laws and regulations.
ix. to consider the major findings of internal investigations
and management’s response.
AUDIT COMMITTEE
REPORT (cont’d)
SCC HOLDINGS BERHAD I pg�� (511477-A)
pg�� I SCC HOLDINGS BERHAD(511477-A)
SCC HOLDINGS BERHAD I pg�� (511477-A)
pg�� I SCC HOLDINGS BERHAD(511477-A)
x. to review the changes in statutory requirements and
any rules issued thereunder, and any significant audit
problems that can be foreseen either as a result of
the previous years’ experience or because of new
development.
xi. to carry out such other responsibilities, functions or
assignments as may be defined jointly by the Audit
Committee and the Board of Directors from time to
time.
xii. in compliance with Paragraph 15.16 of ACE Listing
Requirements, where the Committee is of the view
that a matter reported by it to the Board of Directors
has not been satisfactorily resolved resulting in a
breach of the Listing Requirements, the Committee
must promptly report such matter to Bursa
Securities.
No member of the Audit Committee shall have a
relationship which in the opinion of the Board of Directors
will interfere with the exercise of independent judgement
in carrying out the functions of the Audit Committee.
2.7 Frequency of Meetings
The Audit Committee will meet at least four (4) times a
year although such additional meetings may be called at
any time at the discretion of the Committee.
2.8 Attendance at Meetings
i. The External Auditors are invited to attend the
meetings of the Audit Committee as and when
necessary. At least twice a year, the Audit Committee
shall meet the external auditors without any executive
directors present.
ii. the Secretary of the Audit Committee shall provide
the necessary administrative and secretarial services
for the effective functioning of the Committee. The
minutes of meetings are circulated to the Committee
and to all other members of the Board.
SCC was listed on the ACE Market on the 3 August 2010
and as such only two (2) Audit Committee meetings were
held leading up to the financial year ended 31 December
2010. The Audit Committee members’ attendances at
meetings can be summarised as follows:
Name Total Meeting Percentage attended by Attendance Director (%)
Dr. Choong Tuck Yew 2/2 100
Dato’ Ismail bin Hamzah 2/2 100
Dr. Goy Hong Boon 2/2 100
AUDIT COMMITTEE
REPORT (cont’d)
The Audit Committee meetings were attended by all
Committee Members and invitees. The invitees include
the senior management and External Auditors. The
Company Secretary acted as secretary at the meetings
to record and maintains minutes for the proceedings of
the meeting.
2.9 Authority of Audit Committee
The Audit Committee is authorised by the Board to:-
i. investigate any activity within the scope of the
Committee’s duties;
ii. have full and unrestricted access to any information
from both internal and external auditors and any
employee(s) of the Group;
iii. obtain external legal or other independent
professional advice whenever necessary; and
iv. convene meetings with the external auditors,
internal auditors or both excluding the attendance of
the other directors and employees of the Company
whenever deemed necessary.
SCC HOLDINGS BERHAD I pg�� (511477-A)
pg�� I SCC HOLDINGS BERHAD(511477-A)
SCC HOLDINGS BERHAD I pg�� (511477-A)
pg�� I SCC HOLDINGS BERHAD(511477-A)
AUDIT COMMITTEE
REPORT (cont’d)
SUMMARY OF ACTIVITIES OF THE AUDIT COMMITTEE
The main activities carried out by the Audit Committee during
the year were as follows:
a. Reviewed the quarterly and half yearly unaudited financial
results of the Company and Group before recommending
to the Board for consideration and approval.
b. Reviewed the external auditors’ scope of work and audit
plan for the year.
c. Reviewed with the Internal Auditor, the internal audit plans,
the internal audit reports, their evaluation of system of
internal controls and the follow-up on the audit findings.
d. Reviewed related party transactions within the Group.
INTERNAL AUDIT FUNCTION
The Audit Committee is aware that an independent and
adequately resourced internal audit function is essential to
assist in ensuring an effective and adequate internal control
system.
On 27 August 2010, the Audit Committee has appointed
an independent professional firm as the outsourced internal
auditor.
The cost incurred for the external independent internal audit
services in respect of the financial year ended 2010 was
RM6,350.
The activities of the Internal Audit Function during the
financial year were as follows:
a. develop the internal audit plan for year 2010;
b. execution of the approved internal audit plan;
c. presentation of the internal audit findings at the quarterly
Audit Committee meetings. All findings raised by the
Internal Auditors have been appropriately addressed by
Management; and
d. conducted follow up reviews to ensure that action plans are
properly and appropriately implemented by Management
in accordance with the agreed time frame.
The principal role of the Internal Auditors is to undertake an
independent, regular and systematic reviews of the systems of
internal control so as to provide reasonable assurance that such
systems continue to operate satisfactorily and effectively.
SCC HOLDINGS BERHAD I pg�� (511477-A)
pg�� I SCC HOLDINGS BERHAD(511477-A)
SCC HOLDINGS BERHAD I pg�� (511477-A)
pg�� I SCC HOLDINGS BERHAD(511477-A)
ADDITIONAL COMPLIANCE
INFORMATIONThe following is presented in compliance with the ACE Market Listing Requirements of Bursa Securities:
1. Utilisation of Proceeds raised from Corporate Proposal
As at the FYE 31 December 2010, the proceeds of RM8 million raised by the Company from its IPO exercise have been
utilised as follows:
�. Non-audit Fees
There were no non-audit fees paid to the external auditors
or a firm or company affiliated to the auditors’ firm by the
Group for the FYE 31 December 2010.
�. Material Contracts involving Directors and
Substantial Shareholders
There were no material contracts entered into by the
Company and/or its subsidiaries involving Directors
and Substantial Shareholders’ interests for the FYE 31
December 2010.
�. Variation of Results
There was no variation in results of 10% or more between
the profits stated in the announced unaudited financial
statements and the audited financial statements.
�. Recurrent Related Party Transaction (RRPTs)
RRPTs entered into by the Company and the Group are
disclosed under Note 27 to the Financial Statements on
INTERNAL CONTROLThe Principles of Corporate Governance states that the Board
should maintain a sound system of internal control to safeguard
shareholders’ investment and the Company’s assets.
The Board is committed to maintain a sound system of internal
control in the Group and is pleased to provide the following
Statement on Internal Control (“Statement”) pursuant to
paragraph 15.26(b) of the ACE Market Listing Requirements
of Bursa Malaysia Securities Berhad (“Bursa Securities”) and
the Statement on Internal Control: Guidance for Directors of
Public Listed Companies.
BOARD RESPONSIBILITIES
The Board acknowledges its responsibility for maintaining a
sound system of internal control to safeguard shareholders’
investments and the Group’s assets and for reviewing the
adequacy and integrity of the system. It should be appreciated
that such a system is designed to manage the principle
business risks that may impede the Group from achieving
business objectives, and can only provide reasonable and not
absolute assurance against material misstatement or loss.
The system of internal controls cover financial, organisational,
operational and compliance controls to safeguard shareholders’
investment and the Group’s assets.
RISK MANAGEMENT
The Board understands that risk management plays an
important role in identify risk areas which impede the
achievement of the Group’s corporate objectives. As such the
Group strives to identify and manage its risks in a structured
manner to ensure that the assets and stakeholders’ interests
are well protected and shareholders’ value maximised. This
involves identifying the principal business risks in critical areas,
assessing the likelihood and impact of material exposures
and managing significant risks faced by the Group during the
year.
KEY ELEMENTS OF THE INTERNAL CONTROL SYSTEM
Internal controls are embedded in the Group’s operations as
follows:
Organisation structure
The Group has in place an organisation structure with clearly
defined lines of responsibilities and functionality which promotes
appropriate levels of accountability for risk management,
control procedures and effectiveness of operations.
Board and management meetings
Strategic planning and detailed target setting for each area of
business are established. Monthly monitoring of actual against
target, with significant variances are being investigated and
management action taken, where necessary.
Performance management framework
Management reports are generated on a monthly and quarterly
basis to facilitate the Board and the Group’s management to
perform review on the business units. The reviews encompass
financial and non-financial areas which includes compliance
matters.
Limits of authority
Defined level of authorities and lines of responsibilities from
business units up to the Board level is established to ensure
accountabilities for risk management and control activities.
Operational policies and procedures
The Group’s policies and procedures form an integral part of
the internal control system to safeguard the Group’s assets
against material losses. Clearly documented and standard
operating procedures manuals set out the policies and
procedures for day to day operations to be carried out. Regular
reviews are performed to ensure that documentation remains
current and relevant.
Audit Committee
The Audit Committee reports to the Board on quarterly basis
the activities of the internal audit function, significant changes
and the necessary recommendations in relations to adequacy
and effectiveness of the internal controls and procedures. The
Audit Committee also ensures there are continuous efforts
by management to address and resolve areas with control
weaknesses.
Internal Audit Functions
The internal audit function provides assurance of the
effectiveness of the system of internal controls within the
Group. Internal audit efforts are directed towards areas with
significant risks as identified by Management.
An external independent internal auditor is engaged to assist
the Audit Committee, and by extension, the Board. The
scope covers the audit of business units and operations as
agreed with management. It advises executive and operational
management on areas for improvement and subsequently
reviews the extent to which its recommendations have been
implemented, and reports directly to the Audit Committee on a
quarterly basis. The internal audit work plan, which reflects the
risk profile of the Group’s major business sectors is reviewed
and approved by the Audit Committee.
The monitoring, review and reporting arrangements provides
reasonable assurance that the structure of controls and its
operations are appropriate to the Group’s operations and
that risks are at an acceptable level throughout the Group’s
businesses. Such arrangements, however, do not eliminate the
possibility of human error, deliberate circumvention of control
procedures by employees and others, or the occurrence of
unforeseeable circumstances. The Board is of the view that the
system of internal control in place for the year under review is
sound and sufficient to safeguard shareholders’ investments,
stakeholders’ interests and the Group’s assets.
There were no material losses incurred during the financial
year under review as a result of weaknesses in internal
control. The Board remains committed towards improving the
system of internal control and risk management to meet its
corporate objectives and to support all types of businesses
and operations within the Group.
This statement is made in accordance with a resolution of the
Board dated 21 April 2011.
STATEMENT OF
INTERNAL CONTROL (cont’d)
pg�� I SCC HOLDINGS BERHAD(511477-A)
Financial StatementsDirectors’ Report 30
Statement by Directors 34
Statutory Declaration 34
Independent Auditors’ Report 35
Statement of Financial Position 37
Statement of Comprehensive Income 38
Statement of Changes In Equity 39
Statement of Cash Flow 40
Notes to the Financial Statements 42
SCC HOLDINGS BERHAD I pg�1 (511477-A)
pg�0 I SCC HOLDINGS BERHAD(511477-A)
SCC HOLDINGS BERHAD I pg�1 (511477-A)
pg�0 I SCC HOLDINGS BERHAD(511477-A)
The directors hereby submit their report together with the audited financial statements of the Group and the Company for the financial year ended 31st December 2010.
PRINCIPAL ACTIVITIES
The principal activity of the Company is investment holding. The principal activities of its subsidiaries are set out in Note 5 to the financial statements.
There have been no significant changes in the nature of these principal activities during the financial year, except for principal activities of the subsidiaries acquired during the financial year as disclosed in Note 5 of the financial statements.
RESULTS
Group Company RM’000 RM’000
Profit for the financial year 5,909 2,617Other comprehensive income 26 -
Total comprehensive income for the financial year 5,935 2,617
Profit attributable to:Equity holders of the Company 5,909 2,617Minority interest - -
5,909 2,617
Total comprehensive income attributable to:Equity holders of the Company 5,935 2,617Minority interest - -
5,935 2,617
RESERVES AND PROVISIONS
All material transfers to and from reserves and provisions during the financial year have been disclosed in the financial statements.
DIVIDENDS
Since the end of the financial period, the Company paid an interim tax exempt (single-tier) dividend of 1 sen, on 42,757,000 ordinary shares amounting to RM427,570/= in respect of the current financial year.
At the forthcoming Annual General Meeting, a final tax exempt (single-tier) dividend in respect of the financial year ended 31st December 2010, of 4 sen on 42,757,000 ordinary shares, amounting to RM1,710,280/- will be proposed for shareholders’ approval. The financial statements for the current financial year do not reflect the proposed dividends. Such dividend, if approved by the shareholders, will be accounted for in equity as an appropriation of retained profits in the financial year ending 31st December 2011.
DIRECTORS’
REPORT
SCC HOLDINGS BERHAD I pg�1 (511477-A)
pg�0 I SCC HOLDINGS BERHAD(511477-A)
SCC HOLDINGS BERHAD I pg�1 (511477-A)
pg�0 I SCC HOLDINGS BERHAD(511477-A)
BAD AND DOUBTFUL DEBTS
Before the statements of comprehensive income and statements of financial position of the Group and of the Company were made out, the directors took reasonable steps to ascertain that action had been taken in relation to the writing off of bad debts and the making of allowance for doubtful debts, and had satisfied themselves that all known bad debts had been written off and adequate allowance had been made for doubtful debts.
At the date of this report, the directors are not aware of any circumstances that would render the amount written off for bad debts, or the amount of the allowance for doubtful debts, in the financial statements of the Group and of the Company inadequate to any substantial extent.
CURRENT ASSETS
Before the statements of comprehensive income and statements of financial position of the Group and of the Company were made out, the directors took reasonable steps to ensure that any current assets, other than debts, which were unlikely to be realised in the ordinary course of business, their values as shown in the accounting records of the Group and of the Company had been written down to an amount that they might be expected to be realised.
At the date of this report, the directors are not aware of any circumstances that would render the values attributed to the current assets in the financial statements of the Group and of the Company misleading.
VALUATION METHODS
At the date of this report, the directors are not aware of any circumstances which have arisen which render adherence to the existing methods of valuation of assets or liabilities of the Group and of the Company misleading or inappropriate.
CONTINGENT AND OTHER LIABILITIES
At the date of this report, there does not exist:-
(i) any charge on the assets of the Group and of the Company that has arisen since the end of the financial year which secures the liabilities of any other person, or
(ii) any contingent liabilities in respect of the Group and of the Company that has arisen since the end of the financial year.
No contingent liabilities or other liabilities of the Group and of the Company has become enforceable, or is likely to become enforceable within the period of twelve months after the end of the financial year which, in the opinion of the directors, will or may substantially affect the ability of the Group and of the Company to meet their obligations as and when they fall due.
CHANGE OF CIRCUMSTANCES
At the date of this report, the directors are not aware of any circumstances, not otherwise dealt with in this report or the financial statements of the Group and of the Company that would render any amount stated in the financial statements misleading.
DIRECTORS’ REPORT (cont’d)
SCC HOLDINGS BERHAD I pg�� (511477-A)
pg�� I SCC HOLDINGS BERHAD(511477-A)
SCC HOLDINGS BERHAD I pg�� (511477-A)
pg�� I SCC HOLDINGS BERHAD(511477-A)
ITEMS OF AN UNUSUAL NATURE
The results of the operations of the Group and of the Company for the financial year were not, in the opinion of the directors, substantially affected by any item, transaction or event of a material and unusual nature.
There has not arisen in the interval between the end of the financial year and the date of this report any item, transaction or event of a material and unusual nature likely, in the opinion of the directors, to affect substantially the results of the operations of the Group and of the Company for the financial year in which this report is made.
ISSUE OF SHARES AND DEBENTURES
During the financial year, the Company had increased its issued and paid-up share capital from RM2/- to RM21,378,498/- by way of:-
• the issuance of 39,996 ordinary shares of RM0.50 each by cash;
• the issuance of 25,800,000 and 5,800,000 ordinary shares of RM0.50 each through the acquisition of the entire equity interests in SCC Corporation Sdn. Bhd. (“SCCC”) and Anitox (M) Sdn. Bhd. (“ASB”) respectively and,
• the issuance of 11,117,000 ordinary shares of RM0.50 each at an issue price of RM0.78 per ordinary shares through the issuance to eligible employees and business associates/persons who have contributed to the success of the Group, to the public, and by way of private placement.
The Company did not issue any debentures during the financial year.
The new ordinary shares issued during the financial year ranked pari passu in all respects with the existing ordinary shares of the Company.
DIRECTORS
The directors in offices since the date of the last report are :-
Chee Long Sing @ Cher Hwee SengCher Sew SengGoh Ah Heng @ Goh Keng Chin - appointed on 1.4.2010Soh Kian Teck - appointed on 1.4.2010Dato’ Ismail bin Hamzah - appointed on 1.4.2010Dr. Choong Tuck Yew - appointed on 1.4.2010Dr. Goy Hong Boon - appointed on 1.4.2010Cher Lip Chun - appointed on 1.4.2010
DIRECTORS’ INTERESTS
According to the Register of Directors’ shareholdings kept by the Company under Section 134 of the Companies Act, 1965, the interests of those directors who held office at the end of the financial year in shares in the Company during the financial year ended 31st December 2010 are as follows:-
DIRECTORS’ REPORT (cont’d)
SCC HOLDINGS BERHAD I pg�� (511477-A)
pg�� I SCC HOLDINGS BERHAD(511477-A)
SCC HOLDINGS BERHAD I pg�� (511477-A)
pg�� I SCC HOLDINGS BERHAD(511477-A)
DIRECTORS’ INTERESTS (continued)
Number of ordinary shares of RM0.�0 each At Via acquisition At 1.1.�010 Bought of subsidiaries Sold �1.1�.�010
The CompanySCC Holdings Berhad
Direct interestChee Long Sing @ Cher Hwee Seng 2 19,990 9,279,024 - 9,299,016 Cher Lip Chun - - 249,940 - 249,940Cher Sew Seng 2 19,990 5,858,144 - 5,878,136Goh Ah Heng @ Goh Keng Chin - - 4,078,923 - 4,078,923Soh Kian Teck - 218,000 1,782,284 - 2,000,284
Indirect interest*Chee Long Sing @ Cher Hwee Seng - 187,421 - - 187,421 Cher Sew Seng - 525,000 - - 525,000 Cher Lip Chun - 20,000 - - 20,000
* Deemed interest by virtue of his spouse’s and children’s direct shareholding in the company.
By virtue of their interests in the Company, Chee Long Sing @ Cher Hwee Seng, Cher Lip Chun, Cher Sew Seng, Goh Ah Heng @ Goh Keng Chin and Soh Kian Teck are also deemed interested in shares in the subsidiaries to the extent that the Company has an interest.
Other than as stated above, none of the other directors in office at the end of the financial year have any interest in the shares of the Company and its related corporations during the financial year.
DIRECTORS’ BENEFITS
Since the end of the previous financial year, no director of the Company has received or become entitled to receive a benefit (other than a benefit included in the aggregate amount of emoluments received or due and receivable by the directors shown in the financial statements) by reason of a contract made by the Company or a related corporation with the director or with a firm of which the director is a member, or with a company in which the director has a substantial financial interest.
Neither during nor at the end of the financial year was the Company a party to any arrangement whose object was to enable the directors to acquire benefits by means of the acquisition of shares in, or debentures of, the Company or any other body corporate.
AUDITORS
The auditors, Messrs Baker Tilly Monteiro Heng, have expressed their willingness to continue in office.
On behalf of the Boards,
…………………………………………......... …………………………………………........CHEE LONG SING @ CHER HWEE SENG CHER SEW SENGDirector Director
Kuala LumpurDate: 21 April 2011
DIRECTORS’ REPORT (cont’d)
SCC HOLDINGS BERHAD I pg�� (511477-A)
pg�� I SCC HOLDINGS BERHAD(511477-A)
SCC HOLDINGS BERHAD I pg�� (511477-A)
pg�� I SCC HOLDINGS BERHAD(511477-A)
We, CHEE LONG SING @ CHER HWEE SENG AND CHER SEW SENG, being two of the directors of SCC HOLDINGS BERHAD, do hereby state that in the opinion of the directors, the accompanying financial statements are properly drawn up so as to give a true and fair view of the state of affairs of the Group and of the Company as at 31st December 2010 and of the results and cash flows of the Group and of the Company for the financial year ended on that date in accordance with the Financial Reporting Standards and the provisions of the Companies Act, 1965 in Malaysia.
The supplementary information set out on page 77 has been compiled in accordance with the Guidance of Special Matter No. 1, Determination of Realised and Unrealised Profits or Losses in the Context of Disclosure Pursuant to Bursa Malaysia Securities Berhad Listing Requirements, issued by the Malaysian Institute of Accountants.
On behalf of the Boards,
…………………………………………......... …………………………………………........CHEE LONG SING @ CHER HWEE SENG CHER SEW SENGDirector Director
Kuala LumpurDate: 21 April 2011
STATUTORY
DECLARATIONI, SOH KIAN TECK, being the director primarily responsible for the financial management of SCC HOLDINGS BERHAD, do solemnly and sincerely declare that to the best of my knowledge and belief, the financial statements and the supplementary information set out on page 77 are correct, and I make this solemn declaration conscientiously believing the same to be true, and by virtue of the provisions of the Statutory Declarations Act, 1960.
…………………………………………......... SOH KIAN TECK
Subscribed and solemnly declared by the abovenamed at Kuala Lumpur in the Federal Territory on 21 April 2011
Before me,
ARSHAD ABDULLAH (W550)Commissioner for Oaths Kuala Lumpur
STATEMENT BY
DIRECTORS
SCC HOLDINGS BERHAD I pg�� (511477-A)
pg�� I SCC HOLDINGS BERHAD(511477-A)
SCC HOLDINGS BERHAD I pg�� (511477-A)
pg�� I SCC HOLDINGS BERHAD(511477-A)
REPORT ON THE FINANCIAL STATEMENTS
We have audited the financial statements of SCC Holdings Berhad, which comprise the statements of financial position as at 31st December 2010, and the statements of comprehensive income, statements of changes in equity and statements of cash flows of the Group and of the Company for the financial year then ended, and a summary of significant accounting policies and other explanatory notes, as set out on pages 37 to 77.
Directors’ responsibility for the financial statements
The directors of the Company are responsible for the preparation of financial statements that give true and fair view in accordance with the Financial Reporting Standards and the provisions of the Companies Act, 1965 in Malaysia, and for such internal controls as the directors determined are necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud and error.
Auditors’ responsibility
Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with approved standards on auditing in Malaysia. Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance as to whether the financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on our judgement, including the assessment of risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, we consider internal controls relevant to the Company’s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal controls. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by the directors, as well as evaluating the overall presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.
Opinion
In our opinion, the financial statements have been properly drawn up in accordance with the Financial Reporting Standards and the Companies Act, 1965 in Malaysia so as to give a true and fair view of the financial position of the Group and of the Company as at 31st December 2010 and of their financial performance and cash flows for the financial year then ended.
REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS
In accordance with the requirements of the Companies Act, 1965 in Malaysia, we also report the following:-
(a) In our opinion, the accounting and other records and the registers required by the Act to be kept by the Company and its subsidiaries of which we have acted as auditors have been properly kept in accordance with the provisions of the Act.
(b) We are satisfied that the financial statements of the subsidiaries that have been consolidated with the Company’s financial statements are in form and content appropriate and proper for the purposes of the preparation of the financial statements of the Group and we have received satisfactory information and explanations required by us for those purposes.
(c) The auditors’ reports on the financial statements of the subsidiaries did not contain any qualification or any adverse comment made under Section 174(3) of the Act.
INDEPENDENT
AUDITORS’ REPORTTO THE MEMBERS OF SCC HOLDINGS BERHAD(Incorporated in Malaysia)
SCC HOLDINGS BERHAD I pg�� (511477-A)
pg�� I SCC HOLDINGS BERHAD(511477-A)
SCC HOLDINGS BERHAD I pg�� (511477-A)
pg�� I SCC HOLDINGS BERHAD(511477-A)
OTHER MATTERS
The supplementary information set out on page 77 is disclosed to meet the requirement of Bursa Malaysia Securities Berhad and is not part of the financial statements. The directors are responsible for the preparation of the supplementary information in accordance with the Guidance on Special Matter No. 1, Determination of Realised and Unrealised Profits or Losses in the Context of Disclosure Pursuant to Bursa Malaysia Securities Berhad Listing Requirements, as issued by the Malaysian Institute of Accountants (“MIA Guidance”) and the directive of Bursa Malaysia Securities Berhad. In our opinion, the supplementary information is prepared, in all material respects, in accordance with the MIA Guidance and the directive of Bursa Malaysia Securities Berhad.
This report is made solely to the members of the Company, as a body, in accordance with Section 174 of the Companies Act, 1965 in Malaysia and for no other purpose. We do not assume responsibility to any other person for the content of this report.
Baker Tilly Monteiro Heng Heng Ji KengNo. AF 0117 No. 578/05/12 (J/PH)Chartered Accountants Partner
Kuala LumpurDate: 21 April 2011
INDEPENDENT
AUDITORS’ REPORT (cont’d)TO THE MEMBERS OF SCC HOLDINGS BERHAD(Incorporated in Malaysia)
SCC HOLDINGS BERHAD I pg�� (511477-A)
pg�� I SCC HOLDINGS BERHAD(511477-A)
SCC HOLDINGS BERHAD I pg�� (511477-A)
pg�� I SCC HOLDINGS BERHAD(511477-A)
Group <------- Company -------> �010 �010 �00� Note RM’000 RM’000 RM’000
AssetsNon current assetsProperty, plant and equipment 4 4,457 - -Investment in subsidiaries 5 - 15,900 -Investment securities 6 50 - -Goodwill on consolidation 7 8 - -
4,515 15,900 -
Current assetsInventories 8 2,753 - -Trade receivables 9 8,006 - -Other receivables, deposit and prepayments 10 679 258 152Deposits placed with licensed banks 11 15,617 9,081 -Cash and bank balances 2,652 1,146 -
29,707 10,485 152
TOTAL ASSETS 34,222 26,385 152
EQUITY AND LIABILITIESEquity attributable to equity holders of the CompanyShare capital 12 21,379 21,379 #Share premium 13 2,667 2,667 -Retained profits/(accumulated losses) 14 5,464 2,172 (17)Reserve 15 26 - -
Total equity 29,536 26,218 (17)
Non current liabilitiesHire purchase payables 16 53 - -Deferred tax liabilities 17 107 - -
The accompanying notes form an integral part of these financial statements.
STATEMENT OF
FINANCIAL POSITIONAS AT 31ST DECEMBER 2010
SCC HOLDINGS BERHAD I pg�� (511477-A)
pg�� I SCC HOLDINGS BERHAD(511477-A)
SCC HOLDINGS BERHAD I pg�� (511477-A)
pg�� I SCC HOLDINGS BERHAD(511477-A)
Group <------ Company -------> 1.1.�010 1.1.�010 1.�.�00� to to to �1.1�.�010 �1.1�.�010 �1.1�.�00� Note RM’000 RM’000 RM’000
Revenue 21 19,280 3,769 -Cost of sales (9,189) - -
GROSS PROFIT 10,091 3,769 -
Other income 84 84 -Administrative expenses (4,887) (1,236) (3)Selling and distribution expenses (1,831) - -Other expenses (121) - -Negative goodwill arising from acquisition of subsidiaries 3 ,823 - -
OPERATING PROFIT/(LOSS) 22 7,159 2,617 (3)
Finance costs 23 (36) - -
PROFIT/(LOSS) BEFORE TAXATION 7,123 2,617 (3)
Taxation 24 (1,214) - -
PROFIT/(LOSS) FOR THE FINANCIAL YEAR/PERIOD 5,909 2,617 (3)
Other comprehensive income- net gain on fair value changes on available for sale financial assets 26 - -
TOTAL COMPREHENSIVE INCOME/(LOSS)FOR THE FINANCIAL YEAR/PERIOD 5,935 2,617 (3)
Profit attributable to:Equity holders of the Company 5,909 2,617 (3)Minority interest - - -
5,909 2,617 (3)
Total comprehensive income attributable to:Equity holders of the Company 5,935 2,617 (3)Minority interest - - -
5,935 2,617 (3)
Earnings per ordinary share attributable to equity holders of the Company
- basic, earning per ordinary share (sen) 25(a) 20.88- diluted, earning per ordinary share (sen) 25(b) 20.88
The accompanying notes form an integral part of these financial statements.
STATEMENT OF
COMPREHENSIVE INCOMEFOR THE FINANCIAL YEAR ENDED 31ST DECEMBER 2010
SCC HOLDINGS BERHAD I pg�� (511477-A)
pg�� I SCC HOLDINGS BERHAD(511477-A)
SCC HOLDINGS BERHAD I pg�� (511477-A)
pg�� I SCC HOLDINGS BERHAD(511477-A)
Retained Fair value profits/ Share Share Adjustment (Accumulated Total Capital Premium Reserve Losses) Equity RM’000 RM’000 RM’000 RM’000 RM’000
GroupBalance as at 1st January 2010 # - - ( 17) ( 17)Issuance of shares- cash consideration 20 - - - 20- acquisition of subsidiaries 15,800 - - - 15,800- initial public offering 5,559 3,113 - - 8,672Listing expenses paid - (446) - - (446)Dividends (Note 26) - - - (428) (428)Total comprehensive income for the financial year - - 26 5,909 5,935
Balance as at 31st December 2010 21,379 2,667 26 5,464 29,536
CompanyBalance as at 1st January 2008 # - - (14) (14)Total comprehensive loss for the financial period - - - (3) (3)
Balance as at 31st December 2009 # - - (17) (17)Issuance of shares- cash consideration 20 - - - 20- acquisition of subsidiaries 15,800 - - - 15,800- initial public offering 5,559 3,113 - - 8,672Listing expenses paid - (446) - - (446)Dividends (Note 26) - - - (428) (428)Total comprehensive income for the financial period - - - 2,617 2,617
Balance as at 31st December 2010 21,379 2,667 - 2,172 26,218
# RM2/-
The accompanying notes form an integral part of these financial statements.
STATEMENT OF
CHANGES IN EQUITYFOR THE FINANCIAL YEAR ENDED 31ST DECEMBER 2010
SCC HOLDINGS BERHAD I pg�1 (511477-A)
pg�0 I SCC HOLDINGS BERHAD(511477-A)
SCC HOLDINGS BERHAD I pg�1 (511477-A)
pg�0 I SCC HOLDINGS BERHAD(511477-A)
Group <------ Company -------> 1.1.�010 1.1.�010 1.�.�00� to to to �1.1�.�010 �1.1�.�010 �1.1�.�00� RM’000 RM’000 RM’000
CASH FLOWS FROM OPERATING ACTIVITIESProfit/(loss) for the financial year/period 7,123 2,617 (3)Adjustments for: Allowance for impairment 264 - - Depreciation 283 - - Negative goodwill arising from acquisition of subsidiaries (3,823) - - Dividend income - (3,769) - Interest income (267) (84) - Interest expense 36 - - Property, plant and equipment written off 19 - -
Operating Profit/(Loss) Before Working Capital Changes 3,635 (1,236) (3)
Changes in Working Capital Inventories (713) - - Receivables 1,435 (106) (152) Payables (408) (2) 155
Purchase of property, plant and equipment (254) - - Investment in subsidiaries - (100) - Net cash inflow on acquisitions of subsidiaries (Note 5) 7,714 - - Dividends received - 3,769 - Interest received - 84 -
Net Investing Cash Flows 7,460 3,753 -
STATEMENT OF
CASH FLOWSFOR THE FINANCIAL YEAR ENDED 31ST DECEMBER 2010
SCC HOLDINGS BERHAD I pg�1 (511477-A)
pg�0 I SCC HOLDINGS BERHAD(511477-A)
SCC HOLDINGS BERHAD I pg�1 (511477-A)
pg�0 I SCC HOLDINGS BERHAD(511477-A)
Group <------ Company -------> 1.1.�010 1.1.�010 1.�.�00� to to to �1.1�.�010 �1.1�.�010 �1.1�.�00� RM’000 RM’000 RM’000
CASH FLOWS FROM FINANCING ACTIVITIES
Interest paid (36) - - Deposits pledged with licensed banks (940) - - Net proceeds from issuance of ordinary shares 8,692 8,692 - Listing expenses paid (446) (446) - Repayment of hire purchase liabilities (111) - - Dividends paid (428) (428) -
Net Financing Cash Flows 6,731 7,818 -
NET INCREASE IN CASH AND CASH EQUIVALENTS 16,599 10,227 -
CASH AND CASH EQUIVALENTS AT THE BEGINNING OF THE FINANCIAL YEAR/PERIOD # # #
CASH AND CASH EQUIVALENTS AT THE END OF THE FINANCIAL YEAR/PERIOD 16,599 10,227 #
ANALYSIS OF CASH AND CASH EQUIVALENTSCash and bank balances 2,652 1,146 #Deposits placed with licensed banks 15,617 9,081 -Bankers’ acceptance (Note 20) (475) - -Bank overdrafts (Note 20) (255) - -
The accompanying notes form an integral part of these financial statements.
STATEMENT OF
CASH FLOWSFOR THE FINANCIAL YEAR ENDED 31ST DECEMBER 2010 (cont’d)
SCC HOLDINGS BERHAD I pg�� (511477-A)
pg�� I SCC HOLDINGS BERHAD(511477-A)
SCC HOLDINGS BERHAD I pg�� (511477-A)
pg�� I SCC HOLDINGS BERHAD(511477-A)
1. GENERAL INFORMATION
The principal activity of the Company is investment holding. The principal activities of its subsidiaries are set out in Note 5 to the financial statements.
There have been no significant changes in the nature of these principal activities during the financial year, except for principal activities of the subsidiaries acquired during the financial year as disclosed in Note 5 to the financial statements.
The principal place of business of the Company is located at No. 21, Jalan Hujan, Taman Overseas Union, 5th Mile, Jalan Kelang Lama, 58200 Kuala Lumpur.
The registered office of the Company is located at No.10-1, Jalan Sri Hartamas 8, Sri Hartamas, 50480 Kuala Lumpur.
The financial statements are expressed in Ringgit Malaysia (“RM’000”).
The financial statements were authorised for issue by the Board of Directors in accordance with a resolution of the directors on 21 April 2011.
�. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
2.1. Basis of Preparation
The financial statements of the Group and of the Company have been prepared in accordance with the Financial Reporting Standards (“FRS”) and the provisions of the Companies Act, 1965 in Malaysia.
At the beginning of current financial year, the Group and the Company had adopted new and revised FRS which are applicable to the Group and The Company as described fully in Note 2.2 to the financial statements.
The financial statements of the Group and of the Company have also been prepared on the historical cost basis except as disclosed in the significant accounting policies in Note 2.3 to the financial statements.
The preparation of financial statements in conformity with FRS, requires the directors to make certain accounting estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenue and expenses during the reported period. It also requires the directors’ best knowledge of current events and actions, therefore actual results may differ.
The areas involving a higher degree of judgement or complexity, or areas where assumptions and estimates are significant to the financial statements are disclosed in Note 3 to the financial statements.
2.2 New and Revised FRS, Amendments/Improvements to FRS and IC Interpretations (“IC Int”) and Amendments to IC Int
(a) Adoption of New and Revised FRS, Amendments/Improvements to FRS and IC Int and Amendments to IC Int
The Group and the Company had adopted the following new and revised FRS, amendments/improvements to FRS, IC Interpretations (“IC Int”) and amendments to IC Int that are relevant to their operations and are mandatory for the current financial year:-
�. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
2.2 New and Revised FRS, Amendments/Improvements to FRS and IC Interpretations (“IC Int”) and Amendments to IC Int (continued)
(a) Adoption of New and Revised FRS, Amendments/Improvements to FRS and IC Int and Amendments to IC Int (continued)
Revised FRSFRS 101 Presentation of Financial StatementsFRS 123 Borrowing costs
Amendments/Improvements to FRSFRS 1 First-time Adoption of Financial Reporting StandardsFRS 2 Share-based PaymentFRS 5 Non-current Assets Held for Sale and Discontinued OperationsFRS 7 Financial Instruments : DisclosuresFRS 8 Operating SegmentsFRS 107 Statement of Cash FlowsFRS 108 Accounting Policies, Changes in Accounting Estimates and ErrorsFRS 110 Events After the Reporting PeriodFRS 116 Property, Plant and EquipmentFRS 117 LeasesFRS 118 RevenueFRS 119 Employee BenefitsFRS 120 Accounting for Government Grants and Disclosure of Government AssistanceFRS 123 Borrowing CostsFRS 127 Consolidated and Separate Financial StatementsFRS 128 Investment in AssociatesFRS 129 Financial Reporting in Hyperinflationary EconomicsFRS 131 Interests in Joint VenturesFRS 132 Financial Instruments : PresentationFRS 134 Interim Financial ReportingFRS 136 Impairment of AssetsFRS 138 Intangible AssetsFRS 140 Investment Property
IC IntIC Int 9 Reassessment of Embedded DerivativesIC Int 10 Interim Financial Reporting and ImpairmentIC Int 11 FRS 2 – Group and Treasury Share TransactionsIC Int 13 Customer Loyalty ProgrammesIC Int 14 FRS 119 – The Limit on a Defined Benefit Asset, Minimum Funding Requirements and their Interaction.
Amendments to IC IntIC Int 9 Reassessment of Embedded Derivatives
NOTES TO THE
FINANCIAL STATEMENTS (cont’d)
SCC HOLDINGS BERHAD I pg�� (511477-A)
pg�� I SCC HOLDINGS BERHAD(511477-A)
SCC HOLDINGS BERHAD I pg�� (511477-A)
pg�� I SCC HOLDINGS BERHAD(511477-A)
�. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
2.2 New and Revised FRS, Amendments/Improvements to FRS and IC Interpretations (“IC Int”) and Amendments to IC Int (continued)
(a) Adoption of New and Revised FRS, Amendments/Improvements to FRS and IC Int and Amendments to IC Int (continued)
Adoption of the above standards and interpretations did not have any effect on the financial performance or position of the Group and the Company except for those as discussed below:-
FRS 7 Financial Instruments : DisclosuresPrior to 1st January 2010, information about financial instruments was disclosed in accordance with the requirements of FRS 132 Financial Instruments : Disclosure and Presentation. FRS 7 introduces new disclosure to improve the information about financial instruments. It requires the disclosure of qualitative and quantitative information about exposure to risks arising from financial instruments, including specified minimum disclosures about credit risk, liquidity risk and market risk, including sensitivity analysis to market risk. As the change in accounting policy only results in additional disclosures, there is no impact on the financial position or results of the Group and of the Company.
The Group and the Company have applied FRS 7 prospectively in accordance with the transitional provisions. Hence, the new disclosures have not been applied to the comparatives. The new disclosures are included throughout the Group’s and the Company’s financial statements for the financial year ended 31st December 2010.
FRS 8 Operating SegmentsAs of 1st January 2010, the Group determines and presents operating segments based on the information that is internally provided to the chief operating decision maker and concluded that the reportable operating segments in accordance with FRS 8 are the same as the business segments previously identified under FRS 114.
Since the change in accounting policy only impact presentation and disclosure aspects, there is no impact on the financial position or results of the Group and of the Company. These disclosures are shown in Note 28 to the financial statements.
FRS 101 Presentation of Financial Statements (revised)The revised FRS 101 introduces changes in the presentation and disclosures of financial statements. The revised Standard separates owner and non-owner changes in equity. The statement of changes in equity includes only details of transactions with owners, with all non-owner changes in equity presented as a single line. The Standard also introduces the statement of comprehensive income, with all items of income and expenses recognised in profit and loss, together with all other items of recognised income and expense recognised directly in equity, either in one single statement, or in two linked statements. The Group and the Company have elected to present this statement as one single statement.
In addition, a statement of financial position is required at the beginning of the earliest comparative period following a change in accounting policy, the correction of an error or the classification of items in the financial statements.
The revised FRS 101 also requires the Group to make new disclosures to enable users of the financial statements to evaluate the Group’s objectives, policies and processes for managing capital.
The revised FRS 101 was adopted retrospectively by the Group and the Company. Since the change only affects presentation aspects, there is no impact on the financial position or results of the Group and of the Company.
FRS 139 Financial Instruments: Recognition and Measurement FRS 139 establishes principles for recognising and measuring financial assets, financial liabilities and some contracts to buy and sell non-financial items. The Group and the Company have adopted FRS 139 prospectively on 1st January 2010 in accordance with the transitional provisions.
NOTES TO THE
FINANCIAL STATEMENTS (cont’d)
NOTES TO THE
FINANCIAL STATEMENTS (cont’d)
SCC HOLDINGS BERHAD I pg�� (511477-A)
pg�� I SCC HOLDINGS BERHAD(511477-A)
SCC HOLDINGS BERHAD I pg�� (511477-A)
pg�� I SCC HOLDINGS BERHAD(511477-A)
�. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
2.2 New and Revised FRS, Amendments/Improvements to FRS and IC Interpretations (“IC Int”) and Amendments to IC Int (continued)
(a) Adoption of New and Revised FRS, Amendments/Improvements to FRS and IC Int and Amendments to IC Int (continued)
The following are effects arising from the above changes in accounting policies:-
Increase/(decrease) �010 RM’000
GroupStatements of financial positionInvestment in marketable securities - available for sale financial assets 26Reserves - fair value adjustment reserve 26
1.1.�010 to �1.1�.�010 RM’000
GroupStatements of comprehensive incomeOther comprehensive income for the finanicial year, net of tax 26
(b) Revised FRS, Amendments/Improvements to FRS, IC Int and Amendments to IC Int that are issued, but not yet effective and have not been adopted early
Effective for financial periods beginning on or after
Revised FRSFRS 1 First-time Adoption of Financial Reporting Standards 1 July 2010FRS 3 Business Combinations 1 July 2010FRS 124 Related Party Disclosures 1 January 2012FRS 127 Consolidated and Separate Financial Statements 1 July 2010
Amendments/Improvements to FRSFRS 1 First-time Adoption of Financial Reporting Standards 1 January 2011FRS 2 Share-based Payment 1 July 2010 and 1 January 2011FRS 3 Business Combinations 1 January 2011FRS 5 Non-current Assets Held for Sale and Discontinued Operations 1 July 2010FRS 7 Financial Instruments : Disclosure 1 January 2011
NOTES TO THE
FINANCIAL STATEMENTS (cont’d)
NOTES TO THE
FINANCIAL STATEMENTS (cont’d)
SCC HOLDINGS BERHAD I pg�� (511477-A)
pg�� I SCC HOLDINGS BERHAD(511477-A)
SCC HOLDINGS BERHAD I pg�� (511477-A)
pg�� I SCC HOLDINGS BERHAD(511477-A)
�. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
2.2 New and Revised FRS, Amendments/Improvements to FRS and IC Interpretations (“IC Int”) and Amendments to IC Int (continued)
(b) Revised FRS, Amendments/Improvements to FRS, IC Int and Amendments to IC Int that are issued, but not yet effective and have not been adopted early (continued)
Effective for financial perioids beginning on or after
Amendments/Improvements to FRSFRS 101 Presentation of Financial Statements 1 January 2011FRS 121 The Effects of Changes in Foreign Exchange Rates 1 January 2011FRS 128 Related Party Disclosures 1 January 2011FRS 131 Interests in Joint Ventures 1 January 2011FRS 132 Financial Instruments : Presentation 1 March 2010 and 1 January 2011FRS 134 Interim Financial Reporting 1 January 2011FRS 138 Intangible Assets 1 July 2010FRS 139 Financial Instruments: Recognition and Measurement 1 January 2011
IC IntIC Int 4 Determining Whether an Arrangement contains a Lease 1 January 2011IC Int 12 Service Concession Arrangements 1 July 2010IC Int 15 Agreements for the Construction of Real Estate 1 January 2012IC Int 16 Hedges of a Net Investment in a Foreign Operation 1 July 2010IC Int 17 Distributions of Non-cash Assets to Owners 1 July 2010IC Int 18 Transfers of Assets from Customers 1 January 2011IC Int 19 Extinguishing Financial Liabilities with Equity Instruments 1 July 2011
Amendments to IC IntIC Int 9 Reassessment of Embedded Derivatives 1 July 2010IC Int 13 Customer Royalty Programmes 1 January 2011IC Int 14 FRS 119 – The Limit on a Defined Benefit Asset, Minimum Funding Requirements and their Interaction 1 July 2011IC Int 15 Agreements for the Construction of Real Estate 30 August 2010
The directors do not anticipate that the application of the above new and revised FRS, amendments/improvements to FRS, IC Int and amendments to IC Int, when they are effective, will have a material impact on the results and the financial position of the Group and of the Company, except for those discussed below:
FRS 3 Business Combinations (revised) and Amendments to FRS 127 Consolidated and Separate Financial StatementsThe revised standards are effective for annual periods beginning on or after 1st July 2010. The revised FRS 3 introduces a number of changes which will impact the amount of goodwill recognised, the reported results in the period that an acquisition occurs, and future reported results. The Amendments to FRS 127 require that a change in the ownership interest of a subsidiary (without loss of control) is accounted for as an equity transaction. Therefore, such transactions will no longer give rise to goodwill, nor will they give rise to a gain or loss. Furthermore, the amended standard changes the accounting for losses incurred by the subsidiary as well as the loss of control of a subsidiary. These changes will affect future acquisitions or loss of control and transactions with minority interests. The Group does not intend to early adopt.
NOTES TO THE
FINANCIAL STATEMENTS (cont’d)
SCC HOLDINGS BERHAD I pg�� (511477-A)
pg�� I SCC HOLDINGS BERHAD(511477-A)
SCC HOLDINGS BERHAD I pg�� (511477-A)
pg�� I SCC HOLDINGS BERHAD(511477-A)
�. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
2.3 Significant Accounting Policies
(a) Basis of Consolidation
The consolidated financial statements include the financial statements of the Group and its subsidiaries as at the statements of financial position date. The financial statements of the subsidiaries are prepared for the same reporting date as the Group.
Subsidiaries are consolidated from the date of acquisition, being the date on which the Group obtains control, and continue to be consolidated until the date that such control ceases.
Acquisitions of subsidiaries are accounted for using the purchase method. The purchase method of accounting involves allocating the cost of the acquisition to the fair value of the assets acquired and liabilities and contingent liabilities assumed at the date of acquisition. The cost of an acquisition is measured as the aggregate of the fair values, at the date of exchange, of the assets given, liabilities incurred or assumed, and equity instruments issued, plus any costs directly attributable to the acquisition.
Any excess of the cost of the acquisition over the Group’s interest in the fair value of the identifiable assets, liabilities and contingent liabilities represents goodwill. Any excess of the Group’s interest in the net fair value of the identifiable assets, liabilities and contingent liabilities over the cost of acquisition is recognised immediately in the statement of comprehensive income.
Intragroup transactions, balances and unrealised gains on transactions are eliminated on consolidation. Unrealised losses resulting from intragroup transactions are also eliminated unless cost cannot be recovered. Where necessary, adjustments are made to the financial statements of subsidiaries to ensure consistency of accounting policies with those of the Group.
The gain or loss on disposal of a subsidiary is the difference between net disposal proceeds and the Group’s share of its net assets together with any unimpaired balance of goodwill which were not previously recognised in the consolidated statement of comprehensive income.
Minority interest is measured at the minorities’ share of the fair values of identifiable assets and liabilities of the acquiree as at the date of acquisition by the Group and the minorities’ share of changes in equity since the date of acquisition, except when the losses applicable to the minority in a subsidiary exceed the minority interest in the equity of that subsidiary. In such cases, the excess and further losses applicable to the minority are attributed to the equity holder of the Group.
(b) Goodwill on Consolidation
Goodwill represents the excess of the cost of business combination over the Group’s share of net fair value of the identifiable assets, liabilities and contingent liabilities at the date of acquisition. Following the initial recognition, goodwill is stated at cost less impairment losses, if any. The policy for the recognition and measurement of impairment losses is in accordance with Note 2.3(j).
Goodwill is tested annually for impairment and carried at cost less accumulated impairment losses. Impairment losses on goodwill are not reversed. Gains and losses on the disposal of an entity include carrying amount of goodwill relating to the entity sold.
Negative goodwill represents the excess of the fair value of the Group’s share of net assets acquired over the cost of acquisition. Negative goodwill is recognised directly in the statement of comprehensive income.
NOTES TO THE
FINANCIAL STATEMENTS (cont’d)
SCC HOLDINGS BERHAD I pg�� (511477-A)
pg�� I SCC HOLDINGS BERHAD(511477-A)
SCC HOLDINGS BERHAD I pg�� (511477-A)
pg�� I SCC HOLDINGS BERHAD(511477-A)
�. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
2.3 Significant Accounting Policies
(c) Subsidiaries
Subsidiaries are those companies in which the Group has long term equity interest and has the power, directly or indirectly, to govern the financial and operating policies so as to obtain benefits from its activities, generally accompanying a shareholding of more than one half of the voting rights.
In the Company’s separate financial statements, investments in subsidiaries are stated at cost less impairment losses, if any. The policy for the recognition and measurement of impairment losses is in accordance with Note 2.3(j). On disposal of such investments, the difference between net disposal proceeds and their carrying amounts is charged or credited to the statement of comprehensive income.
(d) Property, Plant and Equipment and Depreciation
Property, plant and equipment are stated at historical cost less accumulated depreciation and impairment losses, if any. The policy for the recognition and measurement of impairment losses is in accordance with Note 2.3(j).
Cost includes expenditure that is directly attributable to the acquisition of the asset. When significant parts of an item of property, plant and equipment have different useful lives, they are accounted for as separate items of property, plant and equipment.
The cost of replacing part of an item of property, plant and equipment is included in the asset’s carrying amount or recognised as a separate asset, as appropriate, only when it is probable that the future economic benefits associated with the part will flow to the Group and its cost can be measured reliably. The carrying amount of the replaced part is derecognised. All other repairs and maintenance are charged to the statement of comprehensive income as incurred.
No depreciation is provided on freehold land. All other property, plant and equipment are depreciated on a straight line basis to write off the cost of each asset to its residual value over the estimated useful lives of the assets concerned. The annual rates used for this purpose are as follows: -
Building 2%Office equipment, furniture and fittings 5% - 10%Machinery 10%Motor Vehicles 20%Renovation 10%
The residual values, useful life and depreciation method are reviewed, and adjusted if appropriate, at each balance sheet date. The effects of any revisions of the residual values and useful lives are included in the statement of comprehensive income for the financial year in which the changes arise.
Fully depreciated assets are retained in the accounts until the assets are no longer in use.
An item of property, plant and equipment is derecognised upon disposal or when no future economic benefits are expected from its use or disposal. Any gain or loss arising on derecognition of the asset is included in the statements of comprehensive income in the financial year the asset is derecognised.
NOTES TO THE
FINANCIAL STATEMENTS (cont’d)
NOTES TO THE
FINANCIAL STATEMENTS (cont’d)
SCC HOLDINGS BERHAD I pg�� (511477-A)
pg�� I SCC HOLDINGS BERHAD(511477-A)
SCC HOLDINGS BERHAD I pg�� (511477-A)
pg�� I SCC HOLDINGS BERHAD(511477-A)
�. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
2.3 Significant Accounting Policies
(e) Inventories
Inventories are valued by the management at the lower of cost and net realisable value. Cost is determined on the average cost basis.
Net realisable value is the estimated selling price in the ordinary course of business less the estimated costs of completion and the estimated costs necessary to make the sale.
(f) Share Capital - Ordinary Shares
Ordinary shares are recorded at the nominal value. The consideration in excess of nominal value of shares issued, if any, is accounted for as share premium. Both ordinary shares and share premium are classified as equity.
Dividends on ordinary shares are recognised as liabilities when proposed or declared before the statements of financial position date. A dividend proposed or declared after the statements of financial position date, but before the financial statements are authorised for issue, is not recognised as a liability at the statements of financial position date.
Costs incurred directly attributable to the issuance of the shares are accounted for as a deduction from the share premium, if any, otherwise it is charged to the statements of comprehensive income. Equity transaction costs comprise only those incremental external costs directly attributable to the equity transaction which would otherwise have been avoided.
(g) Revenue Recognition
The Group recognised revenue when the amount of revenue can be reliably measured, it is probable that future economic benefits will flow to the entity and specific criteria have been met for each of the Group’s activities as described below. The amount of revenue is not considered to be reliably measurable until all contingencies relating to the sale have been resolved. The Group bases its estimates on historical results, taking into consideration the type of customer, the type of transaction and the specifics of each arrangement.
i. SalesofgoodsRevenue is recognised upon delivery of products and customers’ acceptance, net of discounts and returns and when the significant risk and rewards of ownership have been passed to the buyer. Revenue is not recognised to the extent where there are significant uncertainties regarding recovery of the consideration due, associated costs or the possible return of goods.
ii. InterestincomeInterest income is recognised on an accrual basis.
iii. RentalincomeRental income is recognised on an accruals basis.
(h) Income Tax
The tax expense in the statements of comprehensive income represents the aggregate amount of current tax and deferred tax. Current tax is the expected amount of income taxes payable in respect of the taxable profit for the year and is measure using the tax rates that have been enacted at the reporting date.
NOTES TO THE
FINANCIAL STATEMENTS (cont’d)
NOTES TO THE
FINANCIAL STATEMENTS (cont’d)
SCC HOLDINGS BERHAD I pg�1 (511477-A)
pg�0 I SCC HOLDINGS BERHAD(511477-A)
SCC HOLDINGS BERHAD I pg�1 (511477-A)
pg�0 I SCC HOLDINGS BERHAD(511477-A)
�. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
2.3 Significant Accounting Policies
(h) Income Tax (continued)
Deferred tax is provided for, using the liability method, on temporary differences at the reporting date between the tax bases of assets and liabilities and their carrying amounts in the financial statements. In principle, deferred tax liabilities are recognised for all taxable temporary differences and deferred tax assets are recognised for all deductible temporary differences, unused tax losses and unused tax credits to the extent that it is probable that taxable profit will be available against which the deductible temporary differences, unused tax losses and unused tax credits can be utilised. Deferred tax is not recognised if the temporary difference arises from goodwill or negative goodwill or from the initial recognition of an asset or liability in a transaction which is not a business combination and at time of the transaction, affects neither accounting profit nor taxable profit.
Deferred tax is measured at the tax rates that are expected to apply in the period when the asset is realised or the liability is settled, based on tax rates that have been enacted or substantively enacted at the reporting date. Deferred tax is recognised in the statements of comprehensive income, except when it arises from a transaction which is recognised directly in equity, in which case the deferred tax is also charged or credited directly in equity, or when it arises from a business combination that is an acquisition, in which case the deferred tax is included in the resulting goodwill or the amount of any excess of the acquirer’s interest in the net fair value of the acquiree’s identifiable assets, liabilities and contingent liabilities over the cost of the combination.
(i) Financial Instruments
Financial instruments are recognised in the statements of financial position when, and only when, the Group and the Company become a party to the contract provisions of the financial instrument.
A financial instrument is recognised initially, at its fair value, plus, in the case of a financial instrument not at fair value through profit or loss, transaction costs that are directly attributable to the acquisition or issue of the financial instrument.
An embedded derivative is recognised separately from the host contract and accounted for as a derivative if, and only if, it is not closely related to the economic characteristics and risks of the host contract and the host contract is not categorised at fair value through profit or loss. The host contract, the event an embedded derivative is recognised separately, is accounted for in accordance with policy applicable to the nature of the host contract.
The Group and the Company categorise the financial instruments as follows:
(i) FinancialAssets
Financial assets at fair value through profit or loss Financial assets are classified as fair value through profit or loss if they are held for trading, including derivatives, or are designated as such upon initial recognition.
Subsequent to initial recognition, financial assets at fair value through profit or loss are measured at fair value with the gain or loss recognised in profit or loss. Exchange differences, interest and dividend income on financial assets at fair value through profit or loss are recognised as other gains or losses in statement of comprehensive income.
Loans and ReceivablesFinancial assets with fixed or determinable payments that are not quoted in an active market, trade and other receivables and cash and cash equivalents are classified as loans and receivables.
NOTES TO THE
FINANCIAL STATEMENTS (cont’d)
NOTES TO THE
FINANCIAL STATEMENTS (cont’d)
SCC HOLDINGS BERHAD I pg�1 (511477-A)
pg�0 I SCC HOLDINGS BERHAD(511477-A)
SCC HOLDINGS BERHAD I pg�1 (511477-A)
pg�0 I SCC HOLDINGS BERHAD(511477-A)
�. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
2.3 Significant Accounting Policies (continued)
(i) Financial Instruments (continued)
(i) FinancialAssets(continued)
Loans and Receivables (continued)Subsequent to initial recognition, loans and receivables are measured at amortised cost using the effective interest method. Gains and losses are recognised in profit or loss when the loans and receivables are derecognised or impaired, and through the amortisation process.
Held-to-maturity InvestmentsFinancial assets with fixed or determinable payments and fixed maturity that are quoted in an active market and the Group have the positive intention and ability to hold the investment to maturity is classified as held-to-maturity.
Subsequent to initial recognition, held-to-maturity investments are measured at amortised cost using the effective interest method. Gains and losses are recognised in profit or loss when the held-to-maturity investments are derecognised or impaired, and through the amortisation process.
Available-for-sale financial assetsAvailable-for-sale financial are financial assets that are designated as available for sale or are not classified in any of the three preceding categories.
After initial recognition, available-for-sale financial assets are measured at fair value with the gain or loss recognised in other comprehensive income, except for impairment losses, foreign exchange gains and losses on monetary instruments and interest calculated using the effective interest method are recognised in profit or loss. The cumulative gain or loss previously recognised in other comprehensive income is reclassified from equity to profit or loss as a reclassification adjustment when the financial asset is derecognised.
Investments in equity instruments whose fair value cannot be reliably measured are measured at cost less impairment loss.
(ii) FinancialLiabilities
All financial liabilities are subsequently measured at amortised cost other than those categorised as fair value through profit or loss.
Fair value through profit or loss comprises financial liabilities that are held for trading, derivatives (except for a derivative that is a financial guarantee contract or a designated and effective hedging instrument) or financial liabilities that are specifically designated as fair value through profit or loss upon initial recognition.
Derivatives that are linked to and must be settled by delivery of unquoted equity instruments whose fair values cannot be reliably measured are measured at cost.
Other financial liabilities categorised as fair value through profit or loss are subsequently measured at their fair values with the gain or loss recognised in profit or loss.
NOTES TO THE
FINANCIAL STATEMENTS (cont’d)
NOTES TO THE
FINANCIAL STATEMENTS (cont’d)
SCC HOLDINGS BERHAD I pg�� (511477-A)
pg�� I SCC HOLDINGS BERHAD(511477-A)
SCC HOLDINGS BERHAD I pg�� (511477-A)
pg�� I SCC HOLDINGS BERHAD(511477-A)
�. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
2.3 Significant Accounting Policies (continued)
(i) Financial Instruments (continued)
(iii) FinancialGuaranteeContracts
A financial guarantee contract is a contract that requires the issuer to make specified payments to reimburse the holder for a loss it incurs because a specified debtor fails to make payment when due in accordance with the original or modified terms of a debt instrument.
Financial guarantee contracts are classified as deferred income and are amortised to profit or loss over the contractual period or, upon discharge of the guarantee. When settlement of a financial guarantee contract becomes probable, an estimate of the obligation is made. If the carrying value of the financial guarantee contract is lower than the obligation, the carrying value is adjusted to the obligation amount and accounted for as a provision.
(iv) Regularwaypurchaseorsaleoffinancialassets
A regular way purchase or sale is a purchase or sale of a financial asset under a contract whose terms require delivery of the asset within the time frame established generally by regulation or convention the marketplace concerned.
A regular way purchase or sale of financial asset is recognised and derecognised, as applicable, using trade date accounting. Trade date accounting refers to:
(a) the recognition of an asset to be received and the liability to pay for it on the trade date, and
(b) derecognition of an asset that is sold, recognition of any gain or loss on disposal and the recognition of a receivable from the buyer for payment on the trade date.
(v) Derecognition
A financial asset is derecognised when the contractual right to receive cash flows from the asset has expired or is transferred to another party without retaining control or substantially all risks and rewards of the asset. On derecognition of a financial asset, the difference between the carrying amount and the sum of the consideration received and any cumulative gain or loss that had been recognised in other comprehensive income is recognised in profit or loss.
A financial liability is derecognised when the obligation specified in the contract is discharged or cancelled or expires. On derecognition of a financial liability, the difference between the carrying amount and the consideration paid is recognised in profit or loss.
(j) Impairment
(i) ImpairmentofFinancialAssets
All financial assets (except for financial assets categorised as fair value through profit or loss and investment in subsidiaries) are assessed at each reporting date whether there is any objective evidence of impairment as a result of one or more events having an impact on the estimated future cash flows of the asset. Losses expected as a result of future events, no matter how likely, are not recognised. For an equity instrument, a significant or prolonged decline in the fair value below its cost is an objective evidence of impairment.
NOTES TO THE
FINANCIAL STATEMENTS (cont’d)
NOTES TO THE
FINANCIAL STATEMENTS (cont’d)
SCC HOLDINGS BERHAD I pg�� (511477-A)
pg�� I SCC HOLDINGS BERHAD(511477-A)
SCC HOLDINGS BERHAD I pg�� (511477-A)
pg�� I SCC HOLDINGS BERHAD(511477-A)
�. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
An impairment loss in respect of loans and receivables and held-to-maturity investments is recognised in profit or loss and is measured as the difference between the asset’s carrying amount and the present value of estimated future cash flows discounted at the asset’s original effective interest rate. The carrying amount of the asset is reduced through the use of an allowance account.
An impairment loss in respect of available-for-sale financial assets is recognised in the profit or loss and is measured as the difference between the asset’s acquisition cost (net of any principal repayment and amortisation) and the asset’s current fair value, less any impairment loss previously recognised. Where a decline in the fair value of an available-for-sale financial asset has been recognised in the other comprehensive income, the cumulative loss in other comprehensive income is reclassified from equity and recognised to profit or loss.
An impairment loss in respect of unquoted equity instrument that is carried at cost is recognised in profit or loss and is measured as the difference between the asset’s carrying amount and the present value of estimated future cash flows discounted at the current market rate of return for a similar financial asset.
Impairment losses recognised in profit or loss for an investment in an equity instrument is not reversed through the profit or loss.
If, in a subsequent period, the fair value of a debt instrument increases and the increase can be objectively related to an event occurring after the impairment loss was recognised in profit or loss, the impairment loss is reversed, to the extent that the asset’s carrying amount does not exceed what the carrying amount would have been had the impairment not been recognised at the date the impairment is reversed. The amount of the reversal is recognised in the profit or loss.
(ii) ImpairmentofNon-financialAssets
The Group assesses at each reporting date whether there is an indication that an asset may be impaired. If any such indication exists, or when an annual impairment assessment for an asset is required, the Group makes an estimate of the asset’s recoverable amount.
An asset’s recoverable amount is the higher of an asset’s or CGU’s fair value less cost to sell and its value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risk specific to the asset. Where the carrying amounts of an asset exceed its recoverable amount, the asset is considered impaired and is written down to its recoverable amount. Impairment losses recognised in respect of a CGU or groups of CGUs are allocated first to reduce the carrying amount of any goodwill allocated to those units or groups of units and then, to reduce the carrying amount of the other assets in the unit or groups of units on a pro-rata basis.
An impairment loss is recognised in the profit or loss in the period in which it arises.
Impairment loss on goodwill is not reversed in a subsequent period. An impairment loss for an asset other than goodwill is reversed if, and only if, there has been a change in the estimates used to determine the asset’s recoverable amount since the last impairment was recognised. The carrying amount of an asset other than goodwill is increased to its revised recoverable amount, provided that this amount does not exceed its carrying amount that would have been determined (net of amortisation or depreciation) had no impairment loss been recognised for the asset in prior years. A reversal of impairment loss for an asset other than goodwill is recognised in the profit or loss.
NOTES TO THE
FINANCIAL STATEMENTS (cont’d)
NOTES TO THE
FINANCIAL STATEMENTS (cont’d)
SCC HOLDINGS BERHAD I pg�� (511477-A)
pg�� I SCC HOLDINGS BERHAD(511477-A)
SCC HOLDINGS BERHAD I pg�� (511477-A)
pg�� I SCC HOLDINGS BERHAD(511477-A)
�. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
2.3 Significant Accounting Policies (continued)
(k) Cash and Cash Equivalents
For the purpose of cash flow statement, cash and cash equivalents consist of cash in hand, demand deposits, balances with banks and other short term, highly liquid investments that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value. Cash and cash equivalents are stated net of bank overdrafts which are repayable on demand.
(l) Employee Benefits
(i) ShortTermEmployeeBenefits
Wages, salaries, social security contribution, bonuses and non- monetary benefits are recognised as an expense in the period in which the associated services are rendered by the employees. Short term non-accumulating compensated absences such as sick leave are recognised when the absences occur.
Bonuses are recognised as an expense when there is a present, legal or constructive obligation to make such payments, as a result of past events and when a reliable estimate can be made of the amount of the obligation.
(ii) Post-EmploymentBenefits
The Group contributes to the Employees’ Provident Fund, the national defined contribution plan. The contributions are charged to statements of comprehensive income in the period to which they are related. Once the contributions have been paid, the Group has no further payment obligations.
(m) Borrowing Costs
Borrowing costs are charged to the statement of comprehensive income as an expense in the period in which they are incurred.
(n) Foreign currency transaction
Transactions in foreign currencies are translated into Ringgit Malaysia at rates of exchange ruling at transaction dates. Monetary assets and liabilities denominated in foreign currencies at the reporting date are translated into Ringgit Malaysia at the foreign exchange rates ruling at that date. Exchange differences arising from the settlement of foreign currency transactions and from the translation of foreign currency monetary assets and liabilities are included in the profit or loss.
Non-monetary items are measured in term of historical cost in a foreign currency or translated using the exchange rates as at the date of the initial transaction. Nonmonetary items measured at fair value in foreign currency are translated using the exchange rates at the date when the fair value was determined.
(o) Operating Segments
In the previous years, a segment was distinguishable component of the Group that was engaged either in providing products or services (business segment), or in providing products or services within a particular economic environment (geographical segment) which was subject to risks and rewards that were different from those of other segments.
NOTES TO THE
FINANCIAL STATEMENTS (cont’d)
NOTES TO THE
FINANCIAL STATEMENTS (cont’d)
SCC HOLDINGS BERHAD I pg�� (511477-A)
pg�� I SCC HOLDINGS BERHAD(511477-A)
SCC HOLDINGS BERHAD I pg�� (511477-A)
pg�� I SCC HOLDINGS BERHAD(511477-A)
�. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
2.3 Significant Accounting Policies (continued)
(o) Operating Segments (continued)
Following the adoption of FRS 8 Operating Segments, an operating segment is a component of the Group that engages in business activities from which it may earn revenues and incur expenses, including revenues and expenses that relate to transactions with any of the Group’s other components. An operating segment’s operating results are reviewed regularly by the chief operating decision maker, which in this case is the Managing Director of the Group, to make decisions about resources to be allocated to the segment and assess its performance, and for which discrete financial information is available.
�. SIGNIFICANT ACCOUNTING ESTIMATES AND JUDGEMENTS
The preparation of the Group’s financial statements requires management to make judgements, estimates and assumptions that affect the reported amounts of revenues, expenses, assets and liabilities, and the disclosure of contingent liabilities at the reporting date. However, uncertainty about these assumptions and estimates could result in outcomes that could require a material adjustments to the carrying amount of the asset or liability affected in the future.
3.1 Judgements made in applying accounting policies
In the process of applying the Group’s accounting policies, management has made the following judgements, apart from those involving estimations, which have the most significant effect on the amounts recognised in the financial statements:-
ClassificationandImpairmentofFinancialAssets
The Group has classified its investment securities as available-for-sale investment. In applying the accounting policy, the Group assesses its nature and the intention at each reporting date. Should the circumstances change in the future, the classification of this financial asset as available-for-sale may no longer appropriate.
The Group reviews its available for sale investment at each reporting date to assess whether they are impaired. The Group also records impairment charges on available for sale equity investment when there has been a significant or prolonged decline in the fair value below their cost.
3.2 Key sources of estimation uncertainty
The key assumption concerning the future and other key sources of estimation uncertainty at the statements of financial position, that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are as stated below:-
(i) Usefullivesofproperty,plantandequipment
Management estimates the useful lives of the Group’s property, plant and equipment to be within 5 to 50 years. The management estimates the useful lives of the property, plant and equipment based on the period over which the assets are expected to be available for use. The estimated useful lives of property, plant and equipment are reviewed periodically and are updated if expectations differ from previous estimates due to physical wear and tear, technical or commercial obsolescence and legal or other limits on the use of the relevant assets.
In addition, the estimation of the useful lives of property, plant and equipment are based on internal technical evaluation and experience with similar assets. It is possible, however, that future results of operations could be materially affected by changes in the estimates brought about by changes in factors mentioned above. The amounts and timing of recorded expenses for any period would be affected by changes in these factors and circumstances. A reduction in the estimated useful lives of the property, plant and equipment would increase the recorded expenses and decrease the non-current assets.
NOTES TO THE
FINANCIAL STATEMENTS (cont’d)
NOTES TO THE
FINANCIAL STATEMENTS (cont’d)
SCC HOLDINGS BERHAD I pg�� (511477-A)
pg�� I SCC HOLDINGS BERHAD(511477-A)
SCC HOLDINGS BERHAD I pg�� (511477-A)
pg�� I SCC HOLDINGS BERHAD(511477-A)
�. SIGNIFICANT ACCOUNTING ESTIMATES AND JUDGEMENTS (continued)
3.2 Key sources of estimation uncertainty (continued)
(ii) Impairmentofinvestmentinsubsidiaries
The Group tests investment in subsidiaries for impairment annually in accordance with its accounting policy. More regular reviews are performed if events indicate that this is necessary. The assessment of the net tangible assets of the subsidiaries affects the result of the impairment test. The impairment made on investments in subsidiaries entails an allowance for doubtful debts to be made to the amount due by these subsidiaries.
Significant judgement is required in the estimation of the present value of future cash flows generated by the subsidiaries, which involve uncertainties and are significantly affected by assumptions used and judgement made regarding estimates of future cash flows and discount rates. Changes in assumptions could significantly affect the results of the Group’s tests for impairment of investment in subsidiaries.
(iii) Impairmentofnon-currentassets
The Group reviews the carrying amount of its non-current assets, which include property, plant and equipment, to determine whether there is an indication that those assets have suffered an impairment loss in accordance with relevant accounting policies on the respective category of non-current assets. Independent professional valuations to determine the carrying amount of these assets will be procured when the need arise.
As at the end of the financial years under review, the directors are of the view that there is no indication of impairment to these assets and therefore no independent professional valuation was procured by the Group during the financial year to determine the carrying amounts of property, plant and equipment are disclosed Note 4.
(iv)Allowanceforinventories
Reviews are made periodically by management on damaged, obsolete and slow moving inventories. These reviews require judgement and estimates. Possible changes in these estimates could result in revisions to the carrying value of inventories.
(v)Allowanceforimpairment
The Group makes allowances for impairment based on an assessment of the recoverability of receivables. Allowances are applied to receivables where events or changes in circumstances indicate that the carrying amounts may not be recoverable according to the original terms of receivables. Significant judgement is required in the assessment of the recoverability of receivables where the expectation is different from the original estimates, such difference will impact the carrying value of receivables.
(vi)Incometaxes
Significant judgement is required in determining the capital allowances and deductibility of certain expenses during the estimation of the provision for income taxes. There are many transactions and calculations for which the ultimate tax determination is uncertain during the ordinary course of business. Where the final tax outcome of these matters are different from the amounts that were initially recorded, such differences will impact the income tax and deferred income tax provisions in the period in which such determination is made.
NOTES TO THE
FINANCIAL STATEMENTS (cont’d)
NOTES TO THE
FINANCIAL STATEMENTS (cont’d)
SCC HOLDINGS BERHAD I pg�� (511477-A)
pg�� I SCC HOLDINGS BERHAD(511477-A)
SCC HOLDINGS BERHAD I pg�� (511477-A)
pg�� I SCC HOLDINGS BERHAD(511477-A)
�. PROPERTY, PLANT AND EQUIPMENT
Office Freehold Equipment, Land and Furniture Motor Building and Fittings Machinery Vehicles Renovation Total RM’000 RM’000 RM’000 RM’000 RM’000 RM’000
At 31st December 2010 3,518 1,160 815 1,787 36 7,316
Accumulated DepreciationAt 1st January 2010 - - - - - -Acquisition of subsidiaries 282 583 652 1,154 8 2,679Depreciation for the financial year 36 61 47 136 3 283Disposals - (18) (85) - - (103)
At 31st December 2010 318 626 614 1,290 11 2,859
Carrying amounts as at31st December 2010 3,200 534 201 497 25 4,457
a. The land and buildings with the carrying amount of RM3.2 million has been pledged to a licensed bank to secure the credit facilities granted to the subsidiaries disclosed in Note 20.
b. Motor vehicles of the Group with total carrying amount of RM288,155/- were acquired under hire purchase arrangements.
c. Included in property, plant and equipment of the Group are fully depreciated assets which are still in use, with a cost as follows:-
Group �010 RM’000
Office equipment, furniture and fittings 43Motor Vehicle 490Machinery 485
1,018
NOTES TO THE
FINANCIAL STATEMENTS (cont’d)
NOTES TO THE
FINANCIAL STATEMENTS (cont’d)
SCC HOLDINGS BERHAD I pg�� (511477-A)
pg�� I SCC HOLDINGS BERHAD(511477-A)
SCC HOLDINGS BERHAD I pg�� (511477-A)
pg�� I SCC HOLDINGS BERHAD(511477-A)
�. INVESTMENTS IN SUBSIDIARIES
Company �010 �00� RM’000 RM’000
Unquoted shares - at costAt 1st January - -Acquisition of subsidiaries 15,800 -Additional investment in a subsidiary 100 -
At 31st December 15,900 -
The Company’s equity interest in the subsidiaries which are all incorporated in Malaysia and their respective principal activities are as follows:-
Effective Equity Interest �010 �00� Name of Company % % Principal Activities
Direct subsidiariesSCC Corporation Sdn. Bhd. (“SCCC”) 100 - Selling, marketing and distribution of livestock health products and clean feed solutions to feed mills and livestock industries; and selling, marketing and distribution of foodservice equipment, including provisions of installations, services and supply of ingredients and specialists products for food and beverage industries.
Anitox (M) Sdn. Bhd. (“ASB”) 100 - Sale, marketing and distribution of animal health products.
SCC Food and Manufacturing 100 - Processing, purchasing and Sdn. Bhd. (“SCCFM”) transporting food product.
On 12th October 2010, the Company had increased its investment in SCCFM from RM2/- to RM 100,000/- via a subscription of 99,998 ordinary shares of SCCFM at RM1/- each.
Acquisitions Of Subsidiaries �010
On 1st April 2010, the Company entered into conditional share purchase agreements to acquire the entire equity interests in SCCC and ASB for a total consideration of RM12.9 million and RM2.9 million respectively. The acquisitions of subsidiaries were completed on 24th June 2010 and the considerations were settled via the issuance of 25.8 million and 5.8 million ordinary shares of RM0.50 each respectively (Note 12).
On 27th August 2010, the Company had further acquired the entire issued and paid-up share capital of SCCFM comprising 2 ordinary shares of RM1/- each for a total cash consideration of RM 2/-.
NOTES TO THE
FINANCIAL STATEMENTS (cont’d)
NOTES TO THE
FINANCIAL STATEMENTS (cont’d)
SCC HOLDINGS BERHAD I pg�� (511477-A)
pg�� I SCC HOLDINGS BERHAD(511477-A)
SCC HOLDINGS BERHAD I pg�� (511477-A)
pg�� I SCC HOLDINGS BERHAD(511477-A)
�. INVESTMENTS IN SUBSIDIARIES (continued)
Acquisitions Of Subsidiaries �010 (continued)
The effects of acquisition of these subsidiaries on the financial position of the Group are as follows:-
�010 RM’000
Property, plant and equipment 4,505Investment in marketable securities 24Inventories 2,040Trade receivables 9,537Other receivables, deposit and prepayments 1,113Deposits placed with a licensed bank 7,523Cash and bank balance 1,209Hire purchase payables (245)Deferred tax liabilities (110)Trade payables (132)Other payables and accruals (3,004)Short term borrowings (1,018)Tax payable (1,827)
Net identifiable assets 19,615Goodwill on consolidation 8Negative goodwill on acquisition (3,823)
Cost of business combination 15,800Less : non-cash consideration (issued of 31.6 million ordinary shares at RM0.50 each) (15,800)Less : cash consideration #
Add : cash and cash equivalent of subsidiaries acquired 7,714
Net cash inflow on acquisition of subsidiaries 7,714
# RM2/-
Impact of acquisition of subsidiaries in the statements of comprehensive income
From the date of acquisition, the subsidiaries acquired have contributed RM 3.238 million to the Group’s profit net of tax.
�. INVESTMENTS SECURITIES
Group �010 RM’000
Available for sale financial assets
- equity instruments - quoted shares in Malaysia 50
NOTES TO THE
FINANCIAL STATEMENTS (cont’d)
NOTES TO THE
FINANCIAL STATEMENTS (cont’d)
SCC HOLDINGS BERHAD I pg�1 (511477-A)
pg�0 I SCC HOLDINGS BERHAD(511477-A)
SCC HOLDINGS BERHAD I pg�1 (511477-A)
pg�0 I SCC HOLDINGS BERHAD(511477-A)
�. GOODWILL ON CONSOLIDATION
Group �010 RM’000
At cost:-At 1st January -Acquisition of subsidiaries 8
At 31st December 8
�. INVENTORIES
Group �010 RM’000
At cost:-Food service equipments 1,606Animal health products 1,147
2,753
�. TRADE RECEIVABLES
Group �010 RM’000
Trade receivables 8,428Less : Allowance for impairment (422)
8,006
a. The Groups’ normal trade credits range from 30 to 90 days.Other credit terms are assessed and approved on a case-by-case basis. The credit period varies from customers to customers after taking into consideration their payment track record, financial background, length of business relationship and size of transactions.
b. Ageing analysis of trade receivablesThe ageing analysis of the Group’s trade receivables is as follows:
Group �010 RM’000
Neither past due nor impaired -1 to 30 days past due but not impaired 3,49231 to 60 days past due not impaired 1,85261 to 90 days past due not impaired 1,02491 to 120 days past due not impaired 807More than 121 days past due not impaired 831
8,006Impaired 422
8,428
NOTES TO THE
FINANCIAL STATEMENTS (cont’d)
NOTES TO THE
FINANCIAL STATEMENTS (cont’d)
SCC HOLDINGS BERHAD I pg�1 (511477-A)
pg�0 I SCC HOLDINGS BERHAD(511477-A)
SCC HOLDINGS BERHAD I pg�1 (511477-A)
pg�0 I SCC HOLDINGS BERHAD(511477-A)
�. TRADE RECEIVABLES (continued)
c. Receivables that are past due but not impairedTrade receivables that are past due but not impaired are unsecured in nature. These receivables are creditworthy receivables with good payments records with the Group.
d. Receivables that are impairedThe Group’s trade receivables that are impaired at the reporting date and the movement of the allowance accounts used to record the impairment is as follows:
GroupAt 1st January -Charge for the financial year (422)
At 31st December (422)
10. OTHER RECEIVABLES, DEPOSIT AND PREPAYMENT
Group Company �010 �010 �00� RM’000 RM’000 RM’000
Other receivables 454 - -Amount due from subsidiaries - 107 -Deposits 73 1 -Prepayments 152 150 152
679 258 152
a. The foreign currency exposure profiles of other receivable, deposits and prepayments are as follows:-
Ringgit Malaysia 284 258 152United States Dollar 395 - -
679 258 152
b. Amount due from subsidiaries are unsecured, non-interest bearing and repayable upon demand.
NOTES TO THE
FINANCIAL STATEMENTS (cont’d)
NOTES TO THE
FINANCIAL STATEMENTS (cont’d)
SCC HOLDINGS BERHAD I pg�� (511477-A)
pg�� I SCC HOLDINGS BERHAD(511477-A)
SCC HOLDINGS BERHAD I pg�� (511477-A)
pg�� I SCC HOLDINGS BERHAD(511477-A)
11. DEPOSITS PLACED WITH LICENSED BANKS
Group The deposits placed with licensed banks amounting to RM940,000/- are pledged to certain banks to secure banking facilities granted to the subsidiary disclosed in Note 20.
The deposits placed with licensed banks bear effective interest rates ranging from 2.75% to 4.50% per annum.
1�. SHARE CAPITAL
Group and Company �010 �00� Number Number of share of share Units ’000 RM’000 Units ’000 RM’000
Authorised:At 1st January- ordinary shares of RM1/- each - - 100 100- ordinary shares of RM0.50 each 200,000 100,000 - -Subdivision of each share into 2 ordinary shares of RM0.50 each - - 100 -Created during the financial year/period at RM0.50 each - - 199,800 99,900
At 31st December- ordinary shares of RM0.50 each 200,000 100,000 200,000 100,000
Issued and fully paid:At 1st January- ordinary shares of RM1/- each - - * #- ordinary shares of RM0.50 each ∞ # - -Subdivision of each share into 2 ordinary shares of RM0.50 each - - ^ -Issued during the financial year/period 40 20 - -Issued for acquisitions of subsidiaries (Note 5) 31,600 15,800 - -Issued via public offer during the financial year/period 11,117 5,559 - -
At 31st December- ordinary shares of RM0.50 each 42,757 21,379 ∞ #
* : Two (2) ordinary shares of RM1/- each.^ : Two (2) ordinary shares of RM0.50 each.∞ : Four (4) ordinary shares of RM0.50 each.# : RM2/-
NOTES TO THE
FINANCIAL STATEMENTS (cont’d)
NOTES TO THE
FINANCIAL STATEMENTS (cont’d)
SCC HOLDINGS BERHAD I pg�� (511477-A)
pg�� I SCC HOLDINGS BERHAD(511477-A)
SCC HOLDINGS BERHAD I pg�� (511477-A)
pg�� I SCC HOLDINGS BERHAD(511477-A)
1�. SHARE PREMIUM
Group and Company �010 �00� RM’000 RM’000
At 1st January - -Issuance of shares 3,112 -Less : listing expenses paid (445) -
At 31st December 2,667 -
1�. RETAINED PROFITS/(ACCUMULATED LOSSES)
The Company has elected for the irrevocable option to disregard the Section 108 balance. Accordingly, the Company may distribute its dividends under the single tier system.
1�. RESERVE
Reserve consists of fair value adjustment reserve which represents the cumulative fair value changes, net of tax, of available for sale financial assets until they are disposed off or impaired.
1�. HIRE PURCHASE PAYABLES
Group �010 RM’000
Future minimum hire purchase payments - not later than one year 86- later than one year and not later than five year 54
140Future interest charges (6)
Present value of hire purchase liabilities 134
Current- not later than one year 81Non-current- later than one year and not later than five year 53
134
NOTES TO THE
FINANCIAL STATEMENTS (cont’d)
NOTES TO THE
FINANCIAL STATEMENTS (cont’d)
SCC HOLDINGS BERHAD I pg�� (511477-A)
pg�� I SCC HOLDINGS BERHAD(511477-A)
SCC HOLDINGS BERHAD I pg�� (511477-A)
pg�� I SCC HOLDINGS BERHAD(511477-A)
1�. DEFERRED TAX LIABILITIES
Group �010 RM’000
At 1st January 110Transferred to statement of comprehensive income (Note 24) (3)
At 31st December 107
Representing the tax effect of:-Temporary differences between the carrying amounts of property, plant and
equipment and the corresponding tax written down values 107
1�. TRADE PAYABLES
Group �010 RM’000
Trade payables 212
a. The normal credit terms granted to the Group range from 30 to 90 days.
b. The foreign currency exposure profiles on the trade payable are as follows:-
Group �010 RM’000
Ringgit Malaysia 138
United States Dollar 74
212
1�. OTHER PAYABLES, ACCRUALS AND DEPOSITS
Group Company �010 �010 �00� RM’000 RM’000 RM’000
Other payables 106 - 167Amount due to subsidiaries - 63 -Deposits 292 - -Accruals 1,869 104 2
2,267 167 169
NOTES TO THE
FINANCIAL STATEMENTS (cont’d)
NOTES TO THE
FINANCIAL STATEMENTS (cont’d)
SCC HOLDINGS BERHAD I pg�� (511477-A)
pg�� I SCC HOLDINGS BERHAD(511477-A)
SCC HOLDINGS BERHAD I pg�� (511477-A)
pg�� I SCC HOLDINGS BERHAD(511477-A)
�0. SHORT TERM BORROWINGS
Group �010 RM’000
Bank overdrafts - secured 255Bankers’ acceptance 475
730
Bank overdraft and bankers’ acceptance are secured over certain land and buildings of subsidiaries (Note 4) and partial deposits placed with licensed banks (Note 11) of the Company.
The overdraft and bankers’ acceptance bear interest at rates ranging from 1% to 1.25% per annum over the bank’s base landing rate.
�1. REVENUE
Group <------ Company -------> 1.1.�010 1.1.�010 1.�.�00� to to to �1.1�.�010 �1.1�.�010 �1.1�.�00� RM’000 RM’000 RM’000
Dividend Income - 3,769 -Trading sales:- food service equipments 11,619 - -- animal health products 7,661 - -
19,280 3,769 -
Revenue represents net of trading sales of food service equipments and animal health products net of return and discount.
NOTES TO THE
FINANCIAL STATEMENTS (cont’d)
NOTES TO THE
FINANCIAL STATEMENTS (cont’d)
SCC HOLDINGS BERHAD I pg�� (511477-A)
pg�� I SCC HOLDINGS BERHAD(511477-A)
SCC HOLDINGS BERHAD I pg�� (511477-A)
pg�� I SCC HOLDINGS BERHAD(511477-A)
��. PROFIT/(LOSS) BEFORE TAX
Profit/(loss) before tax is arrived at:-
Group <------ Company -------> 1.1.�010 1.1.�010 1.�.�00� to to to �1.1�.�010 �1.1�.�010 �1.1�.�00� RM’000 RM’000 RM’000
After charging:-Auditors’ remuneration- statutory audit 25 10 2- other services 60 60 -Allowance for impairment 264 - -Depreciation 283 - -Directors’ remuneration:- fees 54 54 -- salaries and bonuses 1,015 60 -- Employee’s Provident Fund and SOSCO 130 7 -Property, plant and equipment written off 19 - -Realised loss on foreign exchange 4 - -Rental of premises 223 - -Staff costs:- salaries, allowances and overtime 3,211 - -- Employee’s Provident Funds 395 - -- Other related expenses 98 - -
and crediting:-Bad debts recovered 40 - -Rental income 114 - -Deposit interest 208 80 -Interest received 4 4 -
��. FINANCE COSTS
Group <------ Company -------> 1.1.�010 1.1.�010 1.�.�00� to to to �1.1�.�010 �1.1�.�010 �1.1�.�00� RM’000 RM’000 RM’000
Group <------ Company -------> 1.1.�010 1.1.�010 1.�.�00� to to to �1.1�.�010 �1.1�.�010 �1.1�.�00� RM’000 RM’000 RM’000
Income tax- current year (1,276) - -- over provision in prior year 59
(1,217) - -
Deferred tax (Note 17)- current year 3 - -
(1,214) - -
A reconciliation of income tax expense applicable to profit/(loss) before tax at the statutory income tax rate to income tax expense at the effective income tax rate of the Group and of the Company are as follows:-
Group <------ Company -------> 1.1.�010 1.1.�010 1.�.�00� to to to �1.1�.�010 �1.1�.�010 �1.1�.�00� RM’000 RM’000 RM’000
Profit/(loss) before taxtion 7,123 2,617 (3)
Taxation at applicable statutorytax rate of 25% (2009 : 25%) (1,780) (654) 1Tax effects of:- non-deductible expenditure (435) (288) (1)- non-taxable income 942 942 -- under accrual in prior year 59 - -
Tax expense for the financial year/period (1,214) - -
��. EARNINGS PER SHARE
(a) Basic earnings per share of the Group is calculated by dividing the profit attributable to the equity holders of the Company for the financial year of RM5.909 million by the weighted average number of ordinary shares in issue of 28,298,565.
(b) The Group has no dilutive potential ordinary shares. As such, there is no dilution effect on the earnings per share of the Group.
NOTES TO THE
FINANCIAL STATEMENTS (cont’d)
NOTES TO THE
FINANCIAL STATEMENTS (cont’d)
SCC HOLDINGS BERHAD I pg�� (511477-A)
pg�� I SCC HOLDINGS BERHAD(511477-A)
SCC HOLDINGS BERHAD I pg�� (511477-A)
pg�� I SCC HOLDINGS BERHAD(511477-A)
��. DIVIDENDS
Group and Company 1.1.�010 1.�.�00� to to �1.1�.�010 �1.1�.�00� RM’000 RM’000
Dividends paid in respect of the financial year ended 31st December 2010- interim tax exempt (single-tier) dividend of 1 sen per ordinary share 428 -
Proposed dividends in respect of the financial year ended 31st December 2010- final tax exempt (single-tier) dividend of 4 sen per ordinary share 1,710 -
The proposed final tax exempt (single-tier) dividend of 4 sen per ordinary shares is subject to the approval by the shareholders at the forthcoming Annual General Meeting.
��. SIGNIFICANT RELATED PARTY TRANSACTION
(a) Identification of related parties
Parties are considered to be related to the Group if the Group has the ability, directly or indirectly, to control the party or exercise significant influence over the party in making financial and operational decisions, or vice versa, or where the Group and the party are subject to common control significant influence. Related parties may be individuals or other entities.
Related parties of the Group include:-(i) A company in which certain directors have substantial interest. McDota (M) Sdn. Bhd. (“MDM”)
(ii) A director of the Company Cher Hwee Seng
(iii) Key management personnel which comprise persons (including the directors of the Company) are having the authority and responsibility for planning, directing, controlling the activities of the Group directly or indirectly.
(b) Significant Related Party Transactions and Balances
In the normal course of business, the Group undertakes transactions with some of its related parties listed above. Set out below are the significant related party transactions for the financial year (in addition to related party disclosures mentioned elsewhere in the financial statements). The related party transactions described below were carried out on terms and conditions mutually agreed between the respective parties.
Group <------ Company -------> 1.1.�010 1.1.�010 1.�.�00� to to to �1.1�.�010 �1.1�.�010 �1.1�.�00� RM’000 RM’000 RM’000
Rental paid- McDota (M) Sdn. Bhd. 19 19 -- Cher Hwee Seng 19 19 -
NOTES TO THE
FINANCIAL STATEMENTS (cont’d)
NOTES TO THE
FINANCIAL STATEMENTS (cont’d)
SCC HOLDINGS BERHAD I pg�� (511477-A)
pg�� I SCC HOLDINGS BERHAD(511477-A)
SCC HOLDINGS BERHAD I pg�� (511477-A)
pg�� I SCC HOLDINGS BERHAD(511477-A)
��. SIGNIFICANT RELATED PARTY TRANSACTION (continued)
(c) Key Management Personnel Compensation
The remuneration of the key management personnel during the financial year is as follows:-
Group <------ Company -------> 1.1.�010 1.1.�010 1.�.�00� to to to �1.1�.�010 �1.1�.�010 �1.1�.�00� RM’000 RM’000 RM’000
DirectorsFee 54 54 -Salaries and bonus 1,015 60 -Employees’ Provident Fund and SOCSO 130 7
1,199 121 -
Key managment personnel*Salaries and allowance 426 - -Employees’ Provident Fund and SOCSO 71 - -
497 - -
* Key management personnel comprise persons including the directors of the Group entities, having authority and responsibility for planning, directing and controlling the activities of the Group entities either directly or indirectly.
The directors are of the opinion that the above transactions are in the normal course of business and at terms mutually agreed between the parties.
��. SEGMENTAL INFORMATION
During the financial year, the Group adopted FRS 8 Operating Segments. FRS 8 requires the identification of operating segments on the basis of internal reports that are regularly reviewed by the Group’s chief operating decision maker in order to allocate resources to the segments and assess their performance. Nevertheless, the replaced FRS 1142004 required the identification of two sets of segments – one based on related products and services, and the other on geographical area. FRS 1142004 regarded one set as primary segments and the other as secondary segments.
(a) General Information
For management purposes, the Group is organised into business units based on their products and services, and has two reportable operating segments as follows:
(i) Food service equipment segment includes all industrial-grade equipment used to aid the final preparation and delivery of meals to customers. Food service equipment are highly specialised for application in large kitchens and are suited for the use of restaurants, cafes, fast food joints and other food service providers.
(ii) Animal Health Products segment are substances added in small or micro quantities to macronutrient of animal feed to provide specific health or nutrition effects in a concentrated manner and can be categorised into antibiotic feed additives and non-antibiotic feed additives.
NOTES TO THE
FINANCIAL STATEMENTS (cont’d)
NOTES TO THE
FINANCIAL STATEMENTS (cont’d)
SCC HOLDINGS BERHAD I pg�1 (511477-A)
pg�0 I SCC HOLDINGS BERHAD(511477-A)
SCC HOLDINGS BERHAD I pg�1 (511477-A)
pg�0 I SCC HOLDINGS BERHAD(511477-A)
��. SEGMENTAL INFORMATION (continued)
b. Measurement of Reportable Segments
Segment profit or loss is profit earned or loss incurred by each segment without allocation of central administrative costs, finance costs and income tax expense.
All the Group’s assets are allocated to reportable segments other than assets used centrally for the Group, current and deferred tax assets. Jointly used assets are allocated on the basis of the revenues earned by individual segments. All the Group’s liabilities are allocated to reportable segments other than liabilities incurred centrally for the Group, current and deferred tax liabilities. Jointly incurred liabilities are allocated in proportion to the segment assets.
Segment capital expenditure is the total cost incurred during the year to acquire segment assets that are expected to be used for more than one year.
Food Animal Inter- Service Health Segment Equipment Products Total Elimination Consolidated RM’000 RM’000 RM’000 RM’000 RM’000
The Group’s geographical segments are based on the location of the Group’s assets. Sales to external customers disclosed in geographical segments are based on the geographical segments of its customers.
NOTES TO THE
FINANCIAL STATEMENTS (cont’d)
NOTES TO THE
FINANCIAL STATEMENTS (cont’d)
SCC HOLDINGS BERHAD I pg�1 (511477-A)
pg�0 I SCC HOLDINGS BERHAD(511477-A)
SCC HOLDINGS BERHAD I pg�1 (511477-A)
pg�0 I SCC HOLDINGS BERHAD(511477-A)
��. SEGMENTAL INFORMATION (continued) c. Geographical Segments (continued)
The carrying amount of segment assets and capital expenditure, analysed by geographical segments is concentrated in Malaysia. The Group’s revenue by geographical segment is focused on Malaysia.
d. Information About Major Customers
Major customers’ information are revenues from transactions with a single external customer amount to ten percent or more of the Group revenue. A group of entities known to a reporting entity to be under common control shall be considered a single customer, and entities known to the reporting entity to be under the control of that government shall be considered a single customer.
Revenue includes revenue from a major customer amounting to RM1,904,020/-, arising from sales from the food services equipment segment.
��. FAIR VALUE OF FINANCIAL INSTRUMENTS
a. The following are classes of financial instruments that are not carried at fair value and whose carrying amounts are reasonable approximation of fair value:-
Note
Financial assetsTrade receivables 9Other receivables and deposits 10Deposits placed with licensed banks 11Cash and bank balances -
Financial liabilitiesTrade payables 18Other payables and accruals 19Short term borrowings 20Hire purchase payables 16
The carrying amounts of these financial assets and liabilities are reasonable approximation of fair values, either due to their short term nature or that they are floating rate instruments that are re-priced to market interest rates or near the reporting date.
b. Quoted equity instrumentFair value is determined directly by reference to their published market bid price at the reporting date.
The operations of the Group and of the Company are subject to a variety of financial risks, including foreign currency risk, interest rate risk, credit risk, liquidity risk and cash flow risk. The Group and the Company have adopted a financial risk management framework whose principal objective is to minimise the Group’s and the Company’s exposure to risks and/or costs associated with the financing, investing and operating activities of the Group and of the Company.
NOTES TO THE
FINANCIAL STATEMENTS (cont’d)
NOTES TO THE
FINANCIAL STATEMENTS (cont’d)
SCC HOLDINGS BERHAD I pg�� (511477-A)
pg�� I SCC HOLDINGS BERHAD(511477-A)
SCC HOLDINGS BERHAD I pg�� (511477-A)
pg�� I SCC HOLDINGS BERHAD(511477-A)
�0. FAIR VALUE OF FINANCIAL INSTRUMENTS (continued)
(i) Credit Risk
Credit risk is the risk of a financial loss to the Group if a customer or counterparty to a financial instrument fails to meet its contractual obligations. The Group’s exposure to credit risk arises primarily from trade and receivables. The Company’s exposure to credit risk arises principally from loan and advances to subsidiaries.
The management has a credit policy in place to monitor and minimise the exposure of default. The management has in place a credit procedure to monitor and minimise the exposure of default. Trade and other receivables are monitored on a regular and an ongoing basis. Credit evaluations are performed on all customers requiring credit over certain amount.
a. Exposure to credit riskAt the reporting date, the Group’s and Company’s maximum exposure to credit risk is represented by the carrying amount of trade and other receivables recognised in the statements of financial position.
Information regarding credit enhancements for trade receivables is disclosed in Note 9 to the financial statements.
b. Credit risk concentration profileThe Group determines concentrations of credit risk by monitoring the country profile of its trade receivables on an ongoing basis. The Group’s trade receivables credit risk is concentrated in Malaysia.
c. Financial assets that are neither past due nor impairedInformation regarding trade and other receivables that are neither past due nor impaired is disclosed in Note 9 to the financial statements.
Deposits with banks and other financial institutions and investment securities are placed with or entered into with reputable financial institutions with high credit ratings and no history of default.
d. Financial assets that are either past due or impairedInformation regarding financial assets that are past due or impaired is disclosed in Note 9 to the financial statements.
e. Inter company balancesThe Company provides unsecured loans and advances to subsidiaries. The Company monitors the results of the subsidiaries regularly.
As at the end of the reporting period, the maximum exposure to credit risk is represented by their carrying amounts in the statement of financial position.
(ii) Liquidity Risk
Liquidity risk is the risk that the Group will not be able to meet its financial obligations as they fall due. The Group’s exposure to liquidity risk arises principally from its various payables, loans and borrowings.
The Group maintains a level of cash and cash equivalents and bank facilities deemed adequate by the management to ensure, as far as possible, that it will have sufficient liquidity to meet its liabilities when they fall due.
NOTES TO THE
FINANCIAL STATEMENTS (cont’d)
NOTES TO THE
FINANCIAL STATEMENTS (cont’d)
SCC HOLDINGS BERHAD I pg�� (511477-A)
pg�� I SCC HOLDINGS BERHAD(511477-A)
SCC HOLDINGS BERHAD I pg�� (511477-A)
pg�� I SCC HOLDINGS BERHAD(511477-A)
�0. FAIR VALUE OF FINANCIAL INSTRUMENTS (continued)
(ii) Liquidity Risk (continued)
Maturity analysisThe maturity profile of the Group’s and the Company’s financial liabilities based on undiscounted contractual repayment at the reporting date are as follows:
On demand or within 1 to � More than 1 year years � years Total RM’000 RM’000 RM’000 RM’000
CompanyFinancial liabilities 2010Other payables and accruals 167 - - 167
(iii) Market Risk
Market risk is the risk that changes in market prices, such as foreign exchange rates, interest rates and other prices that will affect the Group’s financial position or cash flows.
(a) Interest Rate RiskInterest rate risk is the risk that the fair value or future cash flows of the Group’s financial instruments will fluctuate because of changes in market interest rates.
The Group manages the net exposure to interest rate risks by maintaining sufficient lines of credit to obtain acceptable lending costs and by monitoring the exposure to such risks on an ongoing basis. The Management does not enter into interest rate hedging transactions as the cost of such instruments outweighs the potential risk of interest rate fluctuation.
NOTES TO THE
FINANCIAL STATEMENTS (cont’d)
NOTES TO THE
FINANCIAL STATEMENTS (cont’d)
SCC HOLDINGS BERHAD I pg�� (511477-A)
pg�� I SCC HOLDINGS BERHAD(511477-A)
SCC HOLDINGS BERHAD I pg�� (511477-A)
pg�� I SCC HOLDINGS BERHAD(511477-A)
�0. FAIR VALUE OF FINANCIAL INSTRUMENTS (continued)
(iii) Market Risk (continued)
(a) Interest Rate Risk (continued)
The interest rate profile of the Group’s significant interest-bearing financial instruments, based on carrying amounts as the end of the reporting period was:-
Group Company �010 �010 RM’000 RM’000
Fixed rate instruments
Financial liabilitiesHire purchase payables 134 -
Financial assetsDeposits placed with licensed bank 15,617 9,081
• Sensitivity analysis for fixed rate instrumentsSensitivity analysis does not account for any fixed rate financial liabilities and therefore a change in interest rates at the end of the reporting period would not affect the profit or loss.
• Sensitivity analysis for floating rate instrumentsA change of 1% in interest rates at the end of reporting period would have increased/(decreased) profit before tax by the amounts shown below. This analysis assumes that all other variables remain unchanged.
Group Floating rate instrumentsFinancial liabilities (7) 7
(b) Foreign Currency RiskForeign currency risk is the risk that the fair value or future cash flows of the Group’s financial instruments will fluctuate because of changes in foreign exchange rates.
The Group has transactional currency exposures arising from sales or purchases that are denominated in a currency other than the respective functional currencies of Group entities. The foreign currencies in which these transactions are denominated are mainly US Dollar.
NOTES TO THE
FINANCIAL STATEMENTS (cont’d)
NOTES TO THE
FINANCIAL STATEMENTS (cont’d)
SCC HOLDINGS BERHAD I pg�� (511477-A)
pg�� I SCC HOLDINGS BERHAD(511477-A)
SCC HOLDINGS BERHAD I pg�� (511477-A)
pg�� I SCC HOLDINGS BERHAD(511477-A)
�0. FAIR VALUE OF FINANCIAL INSTRUMENTS (continued)
(iii) Market Risk (continued)
(b) Foreign Currency Risk (continued)The Group’s exposure to foreign currency (a currency which is other than currency of the Group entities) risk, based on carrying amounts as at the end of reporting period was:-
United Stated Dollar RM’000
Group2010 Financial assets- other receivables 395Financial liabilities- trade payables 74
Sensitivity analysis for foreign currency riskA 10% strengthening of the RM against USD at the end of the reporting period would increase profit before tax by RM32,000/-. This analysis assumes that all other variables remain unchanged.
A 10% weakening of the RM against USD at the end of the reporting period would have had equal but opposite effect on the above currency to the amounts shown above on the basis that all other variables remain constant.
(c) Market Price RiskMarket price risk is the risk that the fair value or future cash flows of the Group’s financial instruments will fluctuate because of changes in market prices (other than interest or exchange rates).
The Group is exposed to equity price risk arising from its investment in quoted equity instruments. The quoted equity instruments in Malaysia are listed in the Bursa Malaysia. These instruments are classified as held for sale financial assets.
Sensitivity analysis for market price riskA 10% strengthening in market price at the end of the reporting period would have increased equity by RM5,000/-. A 10% weakening in market price would have had equal but opposite effect on equity. This analysis assumes that all other variables remain constant.
�1. CAPITAL MANAGEMENT
The primary objective of the Group’s capital management is to ensure that it maintains a strong capital base and safeguard the Group’s ability to continue as a going concern, so as to maintain investor, creditor and market confidence and to sustain future development of the business. The directors monitor and determine to maintain an optimal debt-to-equity ratio that complies with debt covenants and regulatory requirements.
NOTES TO THE
FINANCIAL STATEMENTS (cont’d)
NOTES TO THE
FINANCIAL STATEMENTS (cont’d)
SCC HOLDINGS BERHAD I pg�� (511477-A)
pg�� I SCC HOLDINGS BERHAD(511477-A)
SCC HOLDINGS BERHAD I pg�� (511477-A)
pg�� I SCC HOLDINGS BERHAD(511477-A)
�1. CAPITAL MANAGEMENT (continued)
The gearing ratio at 31st December 2010 was as follows:
Group �010 RM’000
Total borrowings 864Shareholders’ funds 29,536Gearing ratio 0.03
There were no changes in the Group’s approach to the capital management during the financial year.
The Group is also required to comply with the disclosure and necessary capital requirements as prescribed in the ACE Market Listing Requirements of Bursa Malaysia Securities Berhad.
��. COMPARATIVES FIGURES
No comparatives have been presented for the Group as the current year is the first year where consolidated financial statements are presented.
NOTES TO THE
FINANCIAL STATEMENTS (cont’d)
SCC HOLDINGS BERHAD I pg�� (511477-A)
pg�� I SCC HOLDINGS BERHAD(511477-A)
SCC HOLDINGS BERHAD I pg�� (511477-A)
pg�� I SCC HOLDINGS BERHAD(511477-A)
On 25th March 2010, Bursa Malaysia Securities Berhad (“Bursa Malaysia”) issued a directive to all listed issuers pursuant to Paragraphs 2.06 and 2.23 of Bursa Malaysia Main Market Listing Requirements. The directive requires all listed issuers to disclose the breakdown of the retained profits or accumulated losses as at the end of the reporting period, into realised and unrealised profits and losses.
On 20th December 2010, Bursa Malaysia further issued guidance on the disclosure and the format required.
Pursuant to the directive, the amounts of realised and unrealised profits or losses included in the retained profits of the Group and the Company as at 31st December 2010 are as follows:-
Group Company �010 �010
RM’000 RM’000
Realised 5,357 2,172Unrealised 107 -
5,464 2,172
The determination of realised and unrealised profits is based on Guidance of Special Matter No. 1, Determination of Realised and Unrealised Profits and Losses in the Context of Disclosure Pursuant to Bursa Malaysia Securities Berhad Listing Requirements, issued by the Malaysian Institute of Accountants on 20th December 2010.
The disclosure of realised and unrealised profits above is solely for complying with the disclosure requirements stipulated in the directive of Bursa Malaysia and should not be applied for any other purposes.
SUPPLEMENTARY INFORMATIONON THE DISCLOSURE OF REALISED AND UNREALISED PROFITS OR LOSSES
SCC HOLDINGS BERHAD I pg�� (511477-A)
pg�� I SCC HOLDINGS BERHAD(511477-A)
SCC HOLDINGS BERHAD I pg�� (511477-A)
pg�� I SCC HOLDINGS BERHAD(511477-A)
SHARE CAPITAL
Authorised Share Capital : RM100,000,000 divided into 200,000,000 ordinary shares of RM0.50 each Issued and Fully Paid-up Capital : RM21,378,500 divided into 42,757,000 ordinary shares of RM0.50 eachClass of Shares : Ordinary shares of RM0.50 eachVoting Rights : One vote per ordinary share
SHAREHOLDING DISTRIBUTION SCHEDULE (AS PER THE RECORD OF DEPOSITORS)
No. of Shareholders Size of Shareholdings No. of Shares Held % of Shares
7 Less than 100 263 * 15 100 to 1,000 9,600 0.02 155 1,001 to 10,000 1,004,260 2.35 126 10,001 to 100,000 4,490,281 10.50 38 100,001 to less than 5% of issued shares 17,996,521 42.09 4 5% and above of the issued shares 19,256,075 45.04
345 TOTAL 42,757,000 100
* Less than 0.01%
LIST OF �0 LARGEST SECURITIES ACCOUNT HOLDERS (AS PER THE RECORD OF DEPOSITORS)
Name of Shareholders No. of Shares Held (Percentage) %
1. Cher Sew Seng 5,878,136 13.752. Chee Long Sing @ Cher Hwee Seng 5,000,000 11.693. Chee Long Sing @ Cher Hwee Seng 4,299,016 10.054. Goh Ah Heng @ Goh Keng Chin 4,078,923 9.545. Soh Kian Teck 2,000,284 4.686. Ong Gee Leng 1,893,471 4.437. Chu Sou Taik 1,326,197 3.108. Tee Meng Hock 1,295,056 3.039. Chock Ching Ling 914,000 2.1410. Koh Kim Loon 910,562 2.1311. Tee Meng Hock 909,056 2.1312. Lin Chai Chin 848,060 1.9813. Chu Sou Taik 688,000 1.6114. ECML Nominees (Tempatan) Sdn Bhd 572,200 1.34 Koh Kim Loon (EM1-CN) 15. Tan Eng Hoo 457,000 1.0716. Menteri Kewangan Malaysia - Section 14 (SICDA) 424,046 0.9917. Oon Phaik Siew 379,900 0.8918. Goh Foi Tee 317,721 0.7419. Chua Ngeun Lok 300,000 0.7020. Liao Kuei Hsiang @ June Liao 300,000 0.7021. Globalised Market Traders Pte Ltd 300,000 0.7022. Kor Beng 300,000 0.7023. Cher Chou Chiang 300,000 0.7024. Siau Jy Ne 300,000 0.70
ANALYSIS OF
SHAREHOLDINGS AS AT 29 APRIL 2011
SCC HOLDINGS BERHAD I pg�� (511477-A)
pg�� I SCC HOLDINGS BERHAD(511477-A)
SCC HOLDINGS BERHAD I pg�� (511477-A)
pg�� I SCC HOLDINGS BERHAD(511477-A)
LIST OF �0 LARGEST SECURITIES ACCOUNT HOLDERS (AS PER THE RECORD OF DEPOSITORS)(continued)
Name of Shareholders No. of Shares Held (Percentage) %
25. Tommy Yap Chee Hui 300,000 0.7026. Liew Kooi Seong 251,000 0.5927. Tey Ser Kok @ Teh Ser Kok 250,000 0.5928. Cher Lip Chun 249,940 0.5829. Chin Soon Foo 230,000 0.5430. Wong Wei Yie 210,000 0.49 TOTAL 35,482,568 82.98
SUBSTANTIAL SHAREHOLDERS (AS PER THE REGISTER OF SUBSTANTIAL SHAREHOLDERS)
<------------------ No. of Shares Held ---------------->Name of Shareholders Direct % Indirect %
1. Chee Long Sing @ Cher Hwee Seng 9,299,016 21.75 42,421# 0.102. Cher Sew Seng 5,878,136 13.75 - -3. Goh Ah Heng @ Goh Keng Chin 4,078,923 9.54 - -4. Tee Meng Hock 2,268,112 5.30 - - Notes:- # Deemed interest by virtue of his direct shareholdings in Kumsan Enterprise (M) Sdn Bhd pursuant to Section 6A of the Companies Act, 1965.
DIRECTORS’ SHAREHOLDINGS (AS PER THE REGISTER OF DIRECTORS’ SHAREHOLDINGS)
<------------------ No. of Shares Held ---------------->Name of Directors Direct % Indirect %
1. Chee Long Sing @ Cher Hwee Seng 9,299,016 21.75 187,421# 0.442. Cher Sew Seng 5,878,136 13.75 525,000 * 1.233. Goh Ah Heng @ Goh Keng Chin 4,078,923 9.54 - -4. Soh Kian Teck 2,000,284 4.68 - -5. Dato’ Ismail bin Hamzah - - - -6. Dr. Choong Tuck Yew - - - -7. Dr. Goy Hong Boon - - - -8. Cher Lip Chun (Alternate Director to Chee Long Sing @ 249,940 0.58 20,000 ^ 0.05 Cher Hwee Seng)
Notes:- * Deemed interest by virtue of his spouse and children’s direct shareholdings in SCC. # Deemed interest by virtue of his direct shareholdings in Kumsan Enterprise (M) Sdn Bhd pursuant to Section 6A of the Companies Act,1965 and by virtue of his spouse and child direct shareholdings in SCC. ^ Deemed interest by virtue of his spouse’s direct shareholdings in SCC.
ANALYSIS OF
SHAREHOLDINGS 29 April 2011 (cont’d)
SCC HOLDINGS BERHAD I pg�1 (511477-A)
pg�0 I SCC HOLDINGS BERHAD(511477-A)
SCC HOLDINGS BERHAD I pg�1 (511477-A)
pg�0 I SCC HOLDINGS BERHAD(511477-A)
List of
PROPERTIES
Location Description Land Area/ Tenure Age of Net Book Date ofof Property (Existing Buildup Building Value as at acquisition Use) Area (Sq. Ft.) �1.1�.�010 No. 15 & 15A Company 1,600/3,200 Freehold 40 years RM332,627 October 1992Jalan Hujan, OfficeTaman Overseas Union,58200 Kuala Lumpur Double Storey(Lot 9383) shoplot No. 93, Jalan Company 9,430/5,835 Freehold 14 years RM868,816 June 1994Pendamar 27/90, WarehouseSeksyen 27, 40400 Shah Alam(PT No 4782) 1+1/2 storey factory No. 138, Jalan Rented out 4,680/6,383 Freehold 8 years RM405,066 March 1999Kapar 27/89, Seksyen 27, 40400 Shah Alam 3 storey(PT No 4742) industrial showroom No. 140, Jalan Company Warehouse 4,680/6,383 Freehold 8 years RM390,649 March 1999Kapar 27/89,Seksyen 27, 40400 Shah Alam 3 storey(PT No 4741) industrial showroom No. 58, Jalan Company Warehouse/ 4,680/3,888 Freehold 4 years RM441,676 June 2005Kapar 27/89, factorySeksyen 27, 40400 Shah Alam(PT 4823) 1+1/2 storey factory No. 54, Jalan Rented out 4,680/3,888 Freehold 4 years RM441,676 June 2005Kapar 27/89, Seksyen 27, 40400 Shah Alam(PT 4825) 1+1/2 storey factory No. 91, Jalan Company Warehouse 4,680/3,735 Freehold 14 years RM319,382 June 1994Pendamar 27/90, Seksyen 27, 40400 Shah Alam(PT No. 4783) 1+1/2 storey factory
SCC HOLDINGS BERHAD I pg�1 (511477-A)
pg�0 I SCC HOLDINGS BERHAD(511477-A)
SCC HOLDINGS BERHAD I pg�1 (511477-A)
pg�0 I SCC HOLDINGS BERHAD(511477-A)
the Eleventh (11th) Annual General Meeting of SCC HOLDINGS BERHAD will be held at
Swan II, 7th Floor, Pearl International Hotel, Batu 5, Jalan Klang Lama, 58000 Kuala Lumpur
on Thursday, 23 June 2011 at 10.00 a.m. for the following purposes:-
NOTICE OF
ANNUAL GENERAL MEETING
AS ORDINARY BUSINESS
1. To receive the Audited Financial Statements of the Company for the financial year ended 31
December 2010 and the Directors and Auditors Reports thereon.
2. To approve a single tier tax exempt final dividend of 4 sen per share for the financial year
ended 31 December 2010.
3. To approve the payment of Directors’ fees of RM54,000 for the financial year ended 31
December 2010.
4. To re-elect the following Directors who retire by rotation pursuant to Article 90 of the
Company’s Articles of Association for re-election:-
(i) Mr Chee Long Sing @ Cher Hwee Seng
(ii) Mr Soh Kian Teck
5. To consider and if thought fit, to pass the following Ordinary Resolution in accordance with
Section 129 (6) of the Companies Act, 1965:-
“THAT Dr. Choong Tuck Yew, retiring pursuant to Section 129 (6) of the Companies Act,
1965, be and is hereby re-appointed as a Director of the Company to hold office until the
next Annual General Meeting.”
6. To re-appoint Messrs Baker Tilly Monteiro Heng as Auditor of the Company for the ensuing
year and to authorise the Directors to fix their remuneration.
AS SPECIAL BUSINESS
To consider and if thought fit, to pass the following resolution:
7. ORDINARY RESOLUTION
AUTHORITY TO ISSUE SHARES PURSUANT TO SECTION 132D OF THE COMPANIES
ACT, 1965
“THAT subject to Section 132D of the Companies Act, 1965 and approvals of the relevant
government/regulatory authorities, the Directors be and are hereby empowered to issue
and allot shares in the Company, at any time to such persons and upon such terms and
conditions and for such purposes as the Directors may, in their absolute discretion, deem fit,
provided that the aggregate number of shares issued pursuant to this Resolution does not
exceed ten percentum (10%) of the total issued and paid up share capital of the Company
for the time being and the Directors be and also empowered to obtain approval for the listing
and quotation for the additional shares so issued on Bursa Malaysia Securities Berhad;
and that such authority shall continue to be in force until the conclusion of the next Annual
General Meeting of the Company.”
8. To transact any other business for which due notice shall have been given in accordance
with the Company’s Articles of Association and the Companies Act, 1965.
NOTICE IS HEREBY
GIVEN THAT
(Ordinary Resolution 1)
(Ordinary Resolution 2)
(Ordinary Resolution 3)
(Ordinary Resolution 4)(Ordinary Resolution 5)
(Ordinary Resolution 6)
(Ordinary Resolution 7)
(Ordinary Resolution 8)
NOTICE OF DIVIDEND ENTITLEMENT AND PAYMENT
NOTICE IS ALSO HEREBY GIVEN THAT subject to the approval of the shareholders at the forthcoming 11th Annual General
Meeting, a single tier tax exempt final dividend of 4 sen per share will be paid on 15 July 2011 to the shareholders whose names
appear in the Record of Depositors at the close of business on 1 July 2011.
A depositor shall qualify for entitlement only in respect of:-
a) shares transferred to the Depositor’s Securities Account before 4.00 p.m. on 1 July 2011 in respect of transfers; and
b) shares bought on Bursa Malaysia Securities Berhad on a cum entitlement basis according to the Rules of Bursa Malaysia
Securities Berhad.
By Order of the Board
SCC HOLDINGS BERHAD
WONG KEO ROU (MAICSA 7021435)
Company Secretary
Kuala Lumpur
1 June 2011
Directors to Retire at Eleventh (11th) Annual General Meeting
Pursuant to the Company’s Articles of Association, Mr Chee Long Sing @ Cher Hwee Seng and Mr Soh Kian Teck will be retiring
under Article 90. Mr Soh Kian Teck has given his notice that he does not wish to seek re-election at the 11th Annual General
Meeting and accordingly will retire at the conclusion of the forthcoming Annual General Meeting.
NOTES ON SPECIAL BUSINESS
Ordinary Resolution No. 8 - Authority to Issue Shares Pursuant to Section 132D of the Companies Act, 1965
The proposed Ordinary Resolution 8, if passed, will empower the Directors of the Company to issue and allot shares in the
Company from time to time and for such purposes as the Directors consider would be in the best interest of the Company. This
authority will, unless revoked or varied by the Company in general meeting, expire at the conclusion of the next Annual General
Meeting of the Company.
The general mandate will provide flexibility to the Company to raise funds, including but not limited to placing of shares, for purpose
of funding future investment projects and/or working capital and/or acquisitions.
Notes:-1. A member of the Company entitled to attend and vote at this meeting may appoint a proxy to attend and vote in his stead.
2. A proxy may but need not be a member of the Company and the provisions of Section 149 (1)(b) of the Companies Act, 1965 shall not apply to the Company.
3. A member shall be entitled to appoint not more than two (2) proxies to attend and vote at the same meeting. Where a member appoints two (2) proxies, the appointment shall be invalid unless he specifies the proportion of his holdings to be represented by each proxy.
4. The instrument appointing a proxy shall be in writing under the hand of the appointor or of his attorney duly authorised in writing or, if the appointor is a corporation, either under the common seal or under the hand of an officer or attorney duly authorised.
5. Where a member is an authorised nominee as defined under the Central Depositories Act, 1991, it may appoint at least one (1) proxy in respect of each Securities Account it holds with ordinary shares of the Company standing to the credit of the said Securities Account.
6. To be valid, the proxy form duly completed must be deposited at the registered office at No. 10-1, Jalan Sri Hartamas 8, Sri Hartamas, 50480 Kuala Lumpur, not less than forty-eight (48) hours before the time for holding the meeting or any adjournment thereof.
NOTICE OF
ANNUAL GENERAL MEETING (cont’d)
pg�� I SCC HOLDINGS BERHAD(511477-A)
1. Receive the Audited Financial Statements of the Company for the financial year ended 31 December 2010 and the Directors’ and Auditors’ Reports thereon
2. Payment of Final Dividend
3. Payment of Directors’ Fees
4. Re-election of Mr Chee Long Sing @ Cher Hwee Seng
5. Re-election of Mr Soh Kian Teck
6. Re-appointment of Dr. Choong Tuck Yew
7. Re-appointment of Auditors
8. Authority to issue shares pursuant to Section 132D of the Companies Act, 1965
I/We (NRIC No./Co. No ) (FULL NAME IN BLOCK LETTERS)
of (ADDRESS)
being a member/members of SCC HOLDINGS BERHAD (511477-A), hereby appoint
(NRIC No./Co. No ) (FULL NAME IN BLOCK LETTERS)
of (ADDRESS)
or failing him (NRIC No./Co. No )(FULL NAME IN BLOCK LETTERS)
of (ADDRESS)
or failing him, the CHAIRMAN OF THE MEETING as my/our proxy to vote for me/us on my/our behalf at the 11th Annual General Meeting of the Company to be held at Swan II, 7th Floor, Pearl International Hotel, Batu 5, Jalan Klang Lama, 58000 Kuala Lumpur on Thursday, 23 June 2011 at 10.00 a.m. and at any adjournment thereof.
Ordinary Resolution For Against
PROXY FORM
SCC HOLDINGS BERHAD(511477-A)
(Incorporated in Malaysia)
(Please indicate with an “X” in the space provided on how you wish to cast your vote. If you do not do so, the proxy will vote or abstain from voting at his discretion.)
Dated this day of 2011. Signature(s) of member(s)
Notes:-1. A member of the Company entitled to attend and vote at this meeting may appoint a proxy to attend and vote in his stead.2. A proxy may but need not be a member of the Company and the provisions of Section 149 (1)(b) of the Companies Act, 1965 shall not apply to
the Company.3. A member shall be entitled to appoint not more than two (2) proxies to attend and vote at the same meeting. Where a member appoints two (2)
proxies, the appointment shall be invalid unless he specifies the proportion of his holdings to be represented by each proxy.4. The instrument appointing a proxy shall be in writing under the hand of the appointor or of his attorney duly authorised in writing or, if the
appointor is a corporation, either under the common seal or under the hand of an officer or attorney duly authorised.5. Where a member is an authorised nominee as defined under the Central Depositories Act, 1991, it may appoint at least one (1) proxy in respect
of each Securities Account it holds with ordinary shares of the Company standing to the credit of the said Securities Account.6. To be valid the proxy form duly completed must be deposited at the registered office at No. 10-1, Jalan Sri Hartamas 8, Sri Hartamas, 50480
Kuala Lumpur, not less than forty-eight (48) hours before the time for holding the meeting or any adjournment thereof.
No. of shares held
FOLD HERE
FOLD HERE
The Company SecretarySCC HOLDINGS BERHAD (511477-A)
No. 10-1, Jalan Sri Hartamas 8, Sri Hartamas, 50480 Kuala Lumpur