ANNUAL REPORT 2012 Annual Report 2012 BOARD OF DIRECTORS En. Abd. Aziz Bin Mat Independent Non-Executive Chairman Mr. Ang Kim Cheng @ Ang Teng Kok Group Managing Director Mr. Tan Chew

MULTI-USAGE HOLDINGS BERHAD228933-D

ANNUAL REPORT2012

32 - 33 Statements of Financial Position

34 - 35 Statements of Changes in Equity

36 - 38 Statements of Cash Flows

39 - 81 Notes to the Financial Statements

82 Supplementary Information- disclosure on realised and unrealised

profits/losses

83 Statement by Directors

83 Declaration by the Director Primarily Responsible for the Financial Management of the Company

84 List of Properties

85 - 86 Statistics of Shareholdings

Enclosed Proxy Form

2 - 3 Notice of Annual General Meeting

4 Corporate Information

5 Corporate Structure

6 - 7 Directors’ Profile

8 - 9 Chairman’s Statement

10 - 17 Corporate Governance Statement

18 - 21 Audit Committee Report

22 - 23 Statement of Risk Management and Internal Control

24 Additional Compliance Information

25 - 27 Directors’ Report

28 - 29 Independent Auditors’ Report

30 - 31 Statements of Comprehensive Income

CONTENTS

02

Annual Report 2012Annual Report 2012

NOTICE IS HEREBY GIVEN that the 21st Annual General Meeting of Multi-Usage Holdings Berhad will be held on Tuesday, 25 June 2013 at 10.00 a.m. at Sri Nilam, Level 2, Bayview Hotel Georgetown Penang, 25A, Farquhar Street, 10200 Penang for the following purposes :

AS ORDINARY BUSINESSES

1. To receive the Audited Financial Statements for the year ended 31 December 2012 and the Reports of Directors and Auditors thereon.

2. To re-elect Mr Ang Kim Cheng @ Ang Teng Kok who retires pursuant to Article 94 of the Company’s Articles of Association.

Ordinary Resolution 1

3. To re-elect En Abd Aziz bin Mat who retires pursuant to Article 94 of the Company’s Articles of Association.


4. To approve the payment of Directors’ fees amounting to RM76,000 for the year ended 31 December 2012.


5. To re-appoint Messrs Deloitte KassimChan as Auditors of the Company and to authorise the Directors to determine their remuneration.


AS SPECIAL BUSINESS

To consider and if thought fit, to pass the following Ordinary Resolution:

6. Authority to issue shares pursuant to Section 132D of the Companies Act 1965

“That subject always to the Companies Act, 1965, the Articles of Association of the Company and approvals from the relevant governmental and/or regulatory bodies where such approvals shall be necessary, authority be and is hereby given to the Directors pursuant to Section 132D of the Companies Act, 1965, to issue and allot ordinary shares from the unissued capital of the Company upon such terms and conditions and at such times as may be determined by the Directors of the Company to be in the interest of the Company provided always that the aggregate number of shares to be issued pursuant to this Resolution does not exceed 10% of the issued capital for the time being of the Company AND THAT the Directors be also empowered to obtain the approval for the listing of and quotation for the additional shares so issued on the Bursa Malaysia Securities Berhad AND THAT such authority shall continue in force until the conclusion of the next Annual General Meeting (“AGM”) of the Company or the expiration of the period within which the next AGM is required by law to be held or revoked/varied by resolution passed by the shareholders in general meeting whichever is the earlier.”


7. To transact any other business of which due notice shall have been given.

BY ORDER OF THE BOARD

Tai Yit Chan (MAICSA 7009143)Ong Tze-En (MAICSA 7026537)Lau Yoke Leng (MAICSA 7034778)Joint Company Secretaries

Penang : 3 June 2013

Notice of Annual General Meeting

03

Multi-Usage Holdings Berhad 228933-D

Notice of Annual General Meeting (cont'd)

Notes :

1. A proxy may but need not be a member of the Company and a member may appoint any person to be his proxy without limitation and the provisions of Section 149(1)(b) of the Companies Act, 1965 shall not apply to the Company. Where a member appoints two (2) or more proxies, he shall specify the proportion of his shareholdings to be represented by each proxy.

2. Where a member of the Company is an authorised nominee as defined under the Central Depositories Act, 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.

3. Where a member of the Company is an exempt authorised nominee which hold ordinary shares in the Company for multiple beneficial owners in one (1) securities account (“Omnibus Account”), there is no limit to the number of proxies which the exempt authorised nominee may appoint in respect of each omnibus account it holds.

4. The instrument appointing a proxy shall be in writing under the hand of the appointer or his attorney duly authorised

in writing or, if such appointer is a corporation, the proxy form must be executed under its Common Seal or the hand of its attorney.

5. For the proxy to be valid, the proxy form duly completed must be deposited at the Company's Registered Office at Suite 2-1, 2nd Floor, Menara Penang Garden, 42A Jalan Sultan Ahmad Shah, 10050 Penang, not less than 48 hours before the time appointed for holding the meeting or adjourned meeting.

6. For the purpose of determining who shall be entitled to attend this meeting, the Company shall be requesting Bursa Malaysia Depository Sdn Bhd to make available to the Company pursuant to Article 51(2) of the Articles of Association of the Company and Paragraph 7.16(2) of the Main Market Listing Requirements of Bursa Malaysia Securities Berhad, a Record of Depositors (“ROD”) as at 18 June 2013 and only a Depositor whose name appears on such ROD shall be entitled to attend this meeting or appoint proxy to attend and/or vote on his/her behalf.

Explanatory Note on Ordinary Business:

1. Agenda 1 is meant for discussion only as the provision of Section 169(1) of the Companies Act, 1965 does not require a formal approval of shareholders of the Company and hence, Agenda 1 is not put forward for voting.

Explanatory Note on Special Business:

1. The Ordinary Resolution 5, if passed, will give the Directors of the Company authority to issue shares in the Company up to an amount not exceeding 10% of the total issued capital of the Company for the time being for such purposes as the Directors consider would be in the best interest of the Company. This authority, unless revoked or varied by shareholders of the Company in general meeting will expire at the conclusion of the next Annual General Meeting.

2. As at the date of this Notice, no new shares in the Company were issued pursuant to the mandate granted to the Directors at the last Annual General Meeting held on 27 June 2012 and which will lapse at the conclusion of the Twenty First Annual General Meeting. The renewed General Mandate will provide flexibility to the Company for any possible fund raising activities, including but not limited to further placing of shares, for purpose of funding future investment project(s), working capital and/or acquisitions.

Statement Accompanying Notice of Annual General Meeting(Pursuant to Paragraph 8.27(2) of the Listing Requirements)

1. No individual is seeking election as a Director at the forthcoming Twenty First AGM of the Company.

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Annual Report 2012

BOARD OF DIRECTORSEn. Abd. Aziz Bin MatIndependent Non-Executive Chairman

Mr. Ang Kim Cheng @ Ang Teng KokGroup Managing Director

Mr. Tan Chew HuaExecutive Director

AUDIT COMMITTEEMr. Teh Eng Aun Chairman

En. Abd. Aziz Bin MatMember

Ir. Cheah Chin HuatMember

NOMINATION COMMITTEEMr. Teh Eng AunChairman En. Abd. Aziz Bin MatMember

REGISTERED OFFICESuite 2-1, 2nd FloorMenara Penang Garden42A, Jalan Sultan Ahmad Shah10050 PenangTel : 04-2294390 Fax : 04-2265860

PRINCIPAL BANKERSRHB Bank BerhadPublic Bank BerhadMalayan Banking Berhad

STOCK EXCHANGE LISTINGMain Market of Bursa Malaysia Securities BerhadStock Code : 9539 Stock Name: MUH

SHARE REGISTRARAGRITEUM Share Registration Services Sdn. Bhd. 2nd Floor, Wisma Penang Garden42, Jalan Sultan Ahmad Shah10050 PenangTel : 04-2282321 Fax : 04-2272391

AUDITORSDeloitte KassimChan4th Floor, Wisma Wang251-A Jalan Burma, 10350 Penang

WEBSITEwww.muh.com.my

Ir. Cheah Chin HuatIndependent Non-Executive Director

Mr. Teh Eng Aun Independent Non-Executive Director

REMUNERATION COMMITTEEMr. Ang Kim Cheng @ Ang Teng KokChairman

En. Abd. Aziz Bin MatMember

Mr. Teh Eng AunMember

JOINT COMPANY SECRETARIESMs. Lau Yoke Leng (MAICSA 7034778)Ms. Ong Tze-En (MAICSA 7026537)Ms. Tai Yit Chan (MAICSA 7009143)

Corporate Information

05


Corporate Structure

MULTI-USAGE HOLDINGS BERHAD(228933-D)

Property Development Division

100% Multi-Usage Property Sdn. Bhd. (261688-A)

100% TF Land Sdn. Bhd. (282678-K)

Contracting Works Division

100% Multi-Usage Engineering Sdn. Bhd. (206530-D)

Manufacturing Division

100% Multi-Mix Sdn. Bhd. (184436-M)

100% Multi-Usage Cement Products Sdn. Bhd. (42876-P)

100% Multi-Usage Cement Products (Johore) Sdn. Bhd. (99167-U)

100% Multi-Usage Cement Products (Selangor) Sdn. Bhd. (109380-P)

Trading Division

100% Multi-Usage Trading Sdn. Bhd. (206556-U)

Others

100% Seleksi Nostalgia Sdn. Bhd. (357512-U)

51% Multi-Usage Heavy Equipment Sdn. Bhd. (383384-D)

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Annual Report 2012

EN. ABD. AZIZ BIN MATAged 47, MalaysianIndependent Non-Executive Chairman

MR. ANG KIM CHENG @ ANG TENG KOKAged 66, MalaysianGroup Managing Director

MR. TAN CHEW HUAAged 55, MalaysianExecutive Director

IR. CHEAH CHIN HUAT Aged 58, MalaysianIndependent Non-Executive Director

Encik Abd. Aziz Bin Mat was appointed to the Board as an Independent Non-Executive Director on 31 May 2001. He has then been elected as an Independent Non-Executive Chairman with effect from 24 February 2009. He is a member of the Audit Committee, the Remuneration Committee and the Nomination Committee of the Company. He graduated with a Bachelor of Science (Agribusiness) from Universiti Pertanian Malaysia. Encik Abd. Aziz is the Managing Director / Chairman of Exclusive Pillar (M) Sdn. Bhd. which deals in building maintenance and laboratory and hospital supplies. Prior to setting up his own business he held the post of Marketing Manager with M-Wave Marketing Sdn. Bhd. from 1990 to 1992.

Mr. Ang Kim Cheng @ Ang Teng Kok is the Group Managing Director ofMulti-Usage Holdings Berhad and was appointed to the Board on 30 June 1994. He serves as Chairman of the Remuneration Committee of the Company. He is the founder of the Multi-Usage group of companies. He has more than 30 years of experience in property and housing development, construction, manufacturing and marketing of cement and concrete products. He is actively involved in the management, marketing, business and corporate development activities of the Group. He also serves on the Board of several private companies.

Mr. Tan Chew Hua was appointed to the Board as an Executive Director on 30 June 1994. He had gained invaluable experience in the manufacturing and trading of building materials, cement and concrete products when he was the Executive Director of Multi-Usage Cement Products Sdn. Bhd., a wholly owned subsidiary of the Company. He also serves on the Board of several private companies.

Ir. Cheah Chin Huat was appointed to the Board on 2 September 2009 as an Independent Non-Executive Director. He is a member of the Audit Committee of the Company. Ir. Cheah obtained his Civil, Structural and Environmental Engineering Degree at University College, London University, England in 1980. He joined Malayawata Steel Berhad in 1980 and then with JuruteraT & T Consultant Sdn Bhd. He was also appointed as Resident Engineer for the supervision of an office complex at Bagan Luar and then with Carmalita Sdn Bhd as a Project Manager. In 1992, he founded the Firm “CH Perunding” with the aim to provide the principal consulting services required for most types of project in Northern Malaysia. At presence, he affiliated with the Institution of Engineers as a corporate member and also registered with the Board of Engineers, Malaysia as a Professional Engineer.

Directors' Profile

07


Directors' Profile (cont'd)

MR. TEH ENG AUNAged 62, MalaysianIndependent Non-Executive Director

Mr. Teh Eng Aun was appointed to the Board on 15 September 2011 as an Independent Non-Executive Director. He serves as Chairman of the Audit Committee and the Nomination Committee of the Company. He is also a member of the Remuneration Committee of the Company. Mr Teh obtained his Bachelor of Commerce from University of Newcastle, New South Wales, Australia in 1975. He is a Member of the Malaysian Institute of Accountants. He practiced as a Chartered Accountant in a public accounting firm between 1981 and 1995. In 1996, he joined a stock broking Firm as a Remisier. He has over 25 years of experience in corporate consultancy, financial management and auditing. He is also an Independent Non-Executive Director of Ire-Tex Corporation Berhad and Muar Ban Lee Group Berhad.

Notes:

1. None of the Directors has any family relationship with other Directors or substantial shareholders of the Company except for Mr. Ang Kim Cheng @ Ang Teng Kok and Mr. Tan Chew Hua which their family members consist of the substantial shareholders of the Company. Details of the Directors’ shareholdings in the Company are provided in the Statistics of Shareholdings Section in this Annual Report.

2. None of the above Directors has any conflict of interest with the Company and/or its subsidiaries.

3. None of the Directors has been convicted for any offences within the past 10 years other than for traffic offences, if any.

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Annual Report 2012

Dear valued shareholders,

On behalf of the Board of Directors (“the Board”), it is my pleasure to present to you the Annual Report and Audited Financial Statements of Multi-Usage Holdings Berhad (“MUH”) and its subsidiaries companies (“the Group”) for the financial year ended 31 December 2012.

Financial Performance

The strategic stance and efforts of the Board and MUH management team to promote long-term growth which drives profit for the Group are reflected in the current financial performance of the Group.

For the financial year under review, the Group reported a turnover of RM28.2 million and a profit before tax of RM2.99 million, which represent of 86% and 20% increase in turnover and profit before tax respectively in the preceding year. This was mainly contributed by a better performance from all segments of the Group.

Prospect

Despite the challenging global economic environment, the Malaysian economy grew at 5.6% in 2012 which is higher compared to the year 2011 which recorded gross domestic product (GDP) of 5.1% (Bank Negara Malaysia). The Positive economy trend is expected to continue into the year 2013 with the GDP forecast to grow at 5.6%. The sustained economy growth augurs well for the country. We look forward to a stable and positive economic and political environment under which we conduct the affairs of our core business profitably and efficiently.

The Board is confident that the Group shall continue to perform and grow satisfactorily, with its well defined plan and assisted by a strong management team. The Group continues to seek for new business opportunities that are both economically viable and financially profitable.

The Board expects that the property development segment to continue leading in the Group’s financial results for the year ending 31 December 2013.

The manufacturing and construction segments are expected to remain bullish and contribute to the bulk of the Group’s earning in the coming financial year.

Dividend

As the Group continue to consolidate and strengthen its business and operations in order to ensure long-term sustainability and to prepare to ride the rising economic tide, the Board will not be recommending any dividend for the financial year ended 31 December 2012.

Corporate Social Responsibility

The Group will continue to be a corporate citizen committed to diligently discharging its responsibilities to the environment and the communication in which we operate. This value has been one of our prime corporate objectives since incorporation.

We also recognise that our employees are our major asset and will continue to emphasis on the welfare of employees, the environment we operate in and to create awareness on the responsibility among its employees to assure the public safety when carrying out its business activities.

We would continue our corporate social responsibility efforts in the Group with the aim of implementing an effective way to incorporate these efforts into our business activities.

Chairman's Statement

09


Chairman's Statement (cont'd)

Appreciation

On behalf of the Board, I wish to extend our heartfelt to all our valued shareholders, customers, purchasers, business associates, bankers, various government bodies and regulatory authorities for their continued support, cooperation, confidence and trust in us.

I would also like to pay tribute to the Group Managing Director, his management team and staff for their hard work, dedication, loyalty, and unwavering commitment to the Group resulting in the record performance in 2012. The Group continues to allocate sufficient resources to train and develop talents from within towards ensuring proper succession planning at all levels of the Group organisation hierarchy.

Last but not least, I wish to thank my distinguished colleagues on the Board for their invaluable professional advices, guidance and contribution in making the Board more effective and efficient.

EN. ABD. AZIZ BIN MATIndependent Non-Executive Chairman28 May 2013

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Annual Report 2012

The Board of Directors (“the Board”) recognises the importance of good corporate governance and the need to ensure that the principles and best practices on corporate governance are observed and practised throughout the Group. The Board views this as a fundamental part of its responsibilities to protect and enhance shareholders’ value and the performance of the Company. It strives to continually improve and comply with the processes and structure as articulated in the Principles set out in the Malaysian Code on Corporate Governance (2012) (“the Code”).

The Group has applied majority of the Principles of the Code and the extent of its compliance is shown as follows:-

A THE BOARD OF DIRECTORS

(a) The Board

The Group is controlled and led by the Board which is responsible for the overall governance of the Group by ensuring the strategic guidance and succession plan of the Group, the effective monitoring of performance goals, and accountability to the Group and shareholders, as well as formalising documentation on matters specifically reserved for its decision and ensuring that the Group’s internal controls, risk management and reporting procedures are well in place.

(b) Board Composition and Independence

The Board currently consists of five (5) members, comprising two (2) Executive Directors and three (3) Non-Executive Directors of whom three (3) are Independent Directors.

The Board composition is in compliance with Paragraph 15.02 of the Listing Requirements of Bursa Malaysia, which requires that at least two (2) or one third (1/3) of the Board, whichever is higher, are Independent Directors. The qualification and experience of each Director are set out under Directors’ Profile in this Annual Report.

The current composition of the Board provides the Group with a wealth of knowledge and experience to draw on with a diverse mix of skills which includes financial, technical and business expertise which are vital for the continued successful direction of the Group.

The Independent Non-Executive Directors who are professional of credibility and repute are noted to be independent of management and free from any business or other relationship that could materially interfere with the exercise of their independent judgement as defined under the Listing Requirements of Bursa Malaysia. They ensure that the strategies proposed by executive members of the Board and management are fully discussed and evaluated, taking into account the long term interests of all stakeholders, namely the Company’s shareholders, employees, customers, business associates and the community as a whole. They are also members of the Audit Committee, Nomination Committee and Remuneration Committee.

There is a clear division of responsibilities between the Chairman and the Group Managing Director to ensure a balance of power and authority. The Chairman is responsible for ensuring Board effectiveness and all proposals are fully deliberated and examined taking into account the interest of shareholders, whilst the Group Managing Director has overall responsibilities for the Group’s day to day business operations, organizational effectiveness, and implementation of Board policies and decisions as well as coordinating the development and implementation of business and corporate strategies. Nevertheless, the ultimate responsibility for the decision on all matters lies with the Board.

The Code recommends that the tenure of an independent director shall not exceed a cumulative period of 9 years. The Company does not have term limits for Independent Directors as the Board is of the view that the length of service more than 9 years does not in any way impair the independent judgement nor their ability to act in the best interests of the Group. On the contrary, their years of service on the Board have imbued them with a sound knowledge of the Group’s business operations. The Nomination Committee and Board carried out an assessment of the independent director, Encik Abd. Aziz Bin Mat, who has served on the Board for more than 9 years, remain objective and independent.

Corporate Governance Statement

11


Corporate Governance Statement (cont'd)

A THE BOARD OF DIRECTORS (cont'd)

(b) Board Composition and Independence (cont'd)

The Company does not have a policy on boardroom diversity, including gender diversity. The Board believes that appointment of board members, regardless of gender, should be based on character, experience, integrity and competences these are the essential criteria for an effective Board. Nevertheless, the Board will give consideration to the gender diversity objective.

The Board is in the midst of finalising its Board Charter as well as the Code of Ethics and Conduct and Corporate Disclosure Policy and Procedure for adoption in year 2013.

(c) Board Meetings

The Board holds regular meeting at four (4) times a year with additional meetings to be convened as and when the Board’s approval is required. During the financial year under review, four (4) Board meetings were held and a majority of the Directors attended all the Board meetings. The attendance of each Director at the Board meetings held during the financial year is as follows:

Name of Directors No. of Board Meetings Attended

Abd Aziz Bin Mat (Independent Non-Executive Chairman) 4/4Ang Kim Cheng @ Ang Teng Kok (Group Managing Director) 4/4Tan Chew Hua (Executive Director) 3/4Cheah Chin Huat (Independent Non-Executive Director) 4/4Teh Eng Aun (Independent Non-Executive Director) 4/4

All the Directors have complied with the minimum 50% attendance requirement in respect of Board meetings as stipulated by the Listing Requirements of Bursa Malaysia.

(d) Supply of Information

All Directors are provided with the agenda together with the Board papers in advance of Board Meetings, so that the Directors have ample time to consider and deliberate knowledgeably on issues and to facilitate informed decision making. The Board papers circulated include quarterly reports and annual financial statements, minutes of all meetings, update from all regulatory authorities, related party transaction, internal and external audit reports. The Board meeting also serves as a platform for Directors to notify the Board of their acceptance of other directorships.

The Non-Executive Chairman chairs the Board Meetings whilst the Executive Officers lead the presentations and provide explanations on the Board reports. At the Board Meetings, the Board reviews the Group’s business operations by analysing the statement of comprehensive income and statement of financial position of the Group as compared to the same corresponding period. The Board also notes the decisions and salient issues deliberated by the Audit Committee and Risk Management Committee through minutes of these committees, which are tabled to the Board.

Senior Management Officers may be invited to attend Board Meetings when necessary, to furnish the Board with explanations and comments on the relevant agenda items tabled at the Board Meetings or to provide clarification on issues that may be raised by any Director.

Minutes of each Board Meeting are circulated to all Directors for their perusal prior to the confirmation of the minutes at the following Board Meeting. The Directors may request for further clarification or raise comments on the minutes prior to the confirmation of the minutes.

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Annual Report 2012


(d) Supply of Information (cont'd)

The Directors are regularly updated by the Company Secretary on the new statutory as well as regulatory requirements relating to Directors’ duties and responsibilities or the discharge of their duties as Directors of the Company. The Company Secretary organises and attends all Board Meetings and ensures that accurate and adequate records of the proceedings of Board Meetings and decisions made are properly kept.

All Directors whether as a full Board or in their individual capacity, have full and unrestricted access to the advice and services of the Company Secretary and Senior Management Officers and may seek independent professional advice, at the Company’s expense, if required, in furtherance of their duties.

(e) Appointment and Re-election

Appointments to the Board are made based on the recommendation of the Nomination Committee. 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.

In accordance with the Company’s Memorandum and Articles of Association, at least one third (1/3) of the Board shall retire from office at each Annual General Meeting (“AGM”) and they may offer themselves for re-election. All Directors shall retire from office at least once in every three (3) years but shall be eligible for re-election. Newly appointed Directors shall hold office until the next AGM and shall be eligible for re-election.

(f) Board Performance Evaluation

The Board, through the Nomination Committee, reviews annually its required mix of skills, expertise attributes and core competencies of its Directors. The Board has set up and implemented a process to be carried out by the Nomination Committee for the assessment and contribution of its Chairman and the individual Board members as well as the assessment and the effectiveness of the Board as a whole. This framework and process is designed to maintain cohesiveness of the Board and, at the help to improve the Board’s effectiveness.

The board performance indicators on which Board effectiveness is evaluated include board composition and structure, board roles and responsibilities. With regards to the individual performance of the respective Directors, the performance indicators include their meeting attendance, their interactive contributions, understanding of their roles and responsibilities and their quality of input.

The performance of the Non-Executive Directors’ is evaluated by the Chairman. The Nomination Committee in turn evaluates the performance of the Chairman. Upon completion of the evaluation process, the Chairman briefs to the Board on the overall results of the evaluation conducted and improvements recommended in respect of the performance of the Board as a whole.

(g) Directors’ Training

There has been greater awareness of the importance and benefits of attending and participating in the training and continuing education programme that will enhance the Directors’ skills and knowledge to effectively discharge their duties as Directors. Therefore, the Directors are encouraged to attend continuing education programme and seminars so as to keep abreast with the latest regulatory developments.

All Directors have successfully completed the Mandatory Accreditation Programme under the auspices of Bursa Malaysia. Details of the training programmes attended by Directors for the financial year ended31 December 2012 are as follows:-


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(g) Directors’ Training (cont'd)

Titles of Seminar / Workshops / Courses attended are:-

Directors Programme Date

Ang Kim Cheng @ Ang Teng Kok

- Updates of Company Secretarial Practices and Related Issues Under The Companies Act 1965

1 &2 August 2012

- Joint Ventures for Property Development, Documentations and Legal Issue in Sale & Purchase of Real Estate and National Land Code (Penang Titles) Act 1963 & Analysis of The National Land Code (NLC) 1965 on NLC Consultation Paper 2012

19-22 November 2012

- Malaysian Code on Corporate Governance 2012 and Recognition and Management of Risk

12 September 2012

Tan Chew Hua - 2012 Tax Updates 15 May 2012

- Joint Ventures for Property Development, Documentations and Legal Issue in Sale & Purchase of Real Estate and National Land Code (Penang Titles) Act 1963 & Analysis of The National Land Code (NLC) 1965 on NLC Consultation Paper 2012

19-22 November 2012

Abd Aziz Bin Mat - Malaysian Budget 2013 Tax Changes and The Impact on Business

10 October 2012

- Corporate Integrity System Malaysia: CEO Dialogue Session 29 November 2012

- Managing Corporate Risk and Achieving Internal Control Through Statutory Compliance

5 December 2012

Cheah Chin Huat - 2012 Tax Updates 15 May 2012

- Malaysian Code on Corporate Governance 2012 and Recognition and Management of Risk

12 September 2012

- Penang Heritage Talk #2 18 February 2012

- Penang Guideline for Hillsite Development 2012 15 September 2012

Teh Eng Aun - Workshop on Tax Planning on Individuals’ Income from Employment & Statutory Requirements by Employers

28 February 2012

- Enhancing Tax Compliance : Avoiding Common Mistakes and Improving Efficiency

19 March 2012

- National Tax Conference 2012 17 & 18 July 2012

- 2013 Budget Seminar - Highlights & Implications 23 October 2012

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Annual Report 2012


(g) Directors’ Training (cont'd)

In addition to the above, updates on companies and securities legislation, and other relevant rules and regulations such as amendments to Companies Act 1965, Listing Requirement of Bursa Malaysia and Malaysian Code on Corporate Governance was provided to the Board, together with Board papers, to acquaint them with the latest developments in these areas.

New Directors were given a thorough briefing by the Management on the Company’s Business Plan and operations upon their appointment to the Board. Site visits are arranged when necessary.

B BOARD COMMITTEES

In discharging its fiduciary duties, the Board has delegated specific responsibilities to the following three (3) Board Committees, which operate within approved terms of reference and where applicable, comply with the recommendations of the Code. Notwithstanding the above, all Board Committees do not have executive powers but only the power to make recommendations to the Board. The ultimate responsibility for the final decision lies with the entire Board. These committees are:

(a) Audit Committee;(b) Nomination Committee; and(c) Remuneration Committee

(a) Audit Committee

The Composition and Terms of Reference of Audit Committee together with its report are presented in this Annual Report under the heading Audit Committee Report.

(b) Nomination Committee

The Nomination Committee comprises the following members:

Teh Eng Aun (Chairman) Independent Non-Executive DirectorAbd Aziz Bin Mat Independent Non-Executive Chairman

The Nomination Committee comprises wholly of Independent Non-Executive Directors. The Committee is primarily responsible for proposing new nominees for appointment to the Board as well as assessing the contribution of each individual Director on annual basis. The appointment of new Directors is the responsibility of the entire Board after considering recommendations of the Nomination Committee.

During the financial year 2012, the Committee had two (2) meeting with full attendance at the meeting.

(c) Remuneration Committee

The Remuneration Committee comprises the following members:

Ang Kim Cheng @ Ang Teng Kok (Chairman) Group Managing DirectorTeh Eng Aun Independent Non-Executive DirectorAbd Aziz Bin Mat Independent Non-Executive Chairman


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B BOARD COMMITTEES (cont'd)

(c) Remuneration Committee (cont'd)

The Remuneration Committee comprises mainly of Independent Non-Executive Directors. The Committee is primarily responsible for recommending policy and framework for Directors’ remuneration including remuneration and other terms of employment for the Executive Directors. The Executive Directors will abstain from deliberating on matters affecting their own remuneration.

During the financial year 2012, the Committee had one (1) meeting with full attendance at the meeting.

C DIRECTORS’ REMUNERATION

(a) Level and Make-up of Remuneration

The Company’s remuneration policy for Directors is tailored to support the Company’s overall objective of delivering long-term value to its shareholders. The remuneration packages are designed to enable the Company to recruit and retain Directors needed to run the Group successfully.

The component parts of Executive Directors’ remuneration are structured so as to link rewards to corporate and individual performance. The level of remuneration for Non-Executive Directors reflects the experience, expertise and level of responsibilities undertaken by each of them.

The remuneration of each Director is reviewed annually by the Remuneration Committee. The Remuneration Committee has a formal and transparent procedure for the entire Board to approve remuneration for Executive Directors and Non-Executive Directors. Each individual Director abstains from the Board decision on his own remuneration package. Directors’ fees are approved by shareholders at the AGM.

(b) Details of Remuneration

The details of the Directors’ remuneration for the financial year ended 31 December, 2012, are as follows:

ExecutiveDirectors

(RM)

Non-Executive Directors

(RM)Total(RM)

Fees 10,000 66,000 76,000Salaries and other emoluments 521,800 - 521,800Meeting Allowances 3,500 6,000 9,500Total 535,300 72,000 607,300

The Company reimburses expenses incurred by the Directors for attending the Board and Committee meetings and meeting allowance of RM500 each for every meeting that the Director attend.

The number of Directors whose remuneration fall within the following bands are:

Range of RemunerationNo. of

Executive DirectorsNo. of

Non-Executive Directors

Up to RM50,000 0 3RM200,001 - RM250,000 1 -RM300,001 - RM350,000 1 -

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Annual Report 2012

D SHAREHOLDERS

The Company acknowledges the importance of transparency and accountability to its shareholders and investors as it ensures that market credibility and investors’ confidence are maintained. Through extensive disclosures of appropriate and relevant information, using various channels of communication on a timely basis, the Group aims to effectively provide shareholders and investors with information to fulfill transparency and accountability objectives. At this juncture, the channel of communication to shareholders, stakeholders and general public for the overall performance and operations of the Group’s business activities are public announcements on quarterly basis, annual report and disclosures to the Bursa Malaysia.

In addition to the published Annual Report and Quarterly Reports announced to Bursa Malaysia, the Company also maintains its homepage that allows all shareholders and investors access to the information about the Company at www.muh.com.my

At the Company’s Annual General Meeting held on 27 June 2012, the Company had practiced poll voting for all its resolutions tabled at the general meeting and shall endeavour to continue this practise at future general meeting of the Company to be held. The upcoming Annual General Meeting represents the principal forum for dialogue and interaction with shareholders where shareholders are informed of current development. Shareholders are accorded both the opportunity and time to raise questions on the agenda items of the general meeting. Where it is not possible to provide immediate answers, the Chairman will undertake to furnish the shareholders(s) with answer after the AGM. The notice of meeting and the Annual Report are sent out to shareholders at least twenty one (21) days before the date of the meeting in accordance with the Company’s Articles of Association.

E ACCOUNTABILITY AND AUDIT

(a) Financial Reporting

The Board aims to present a balanced and meaningful assessment of the Group’s financial performance and prospects through the quarterly and annual financial statements. The Audit Committee assists in reviewing the information disclosed to ensure completeness, accuracy and adequacy prior to release to Bursa Malaysia.

(b) Directors’ Responsibility Statement for preparing the Annual Audited Financial Statements

The Directors are required by the Companies Act, 1965 to prepare financial statements in accordance with the applicable approved accounting standards and to give a true and fair view of the state of affairs of the Group and Company at the end of each financial year and of the results and cash flows of the Group and Company for the financial year end.

In preparing the financial statements, the Directors have:• adopted and applied consistently appropriate accounting policies;• made judgements and estimates that are prudent and reasonable;• ensured applicable approved accounting standards have been followed; and• prepared the financial statements on a going concern basis.

The Directors are responsible for ensuring that the Company keeps proper accounting records which disclose with reasonable accuracy at any time the financial statements comply with the Company Act, 1965. The Directors have overall responsibility for safeguarding the assets of the Group and the Company, and for taking reasonable steps for the prevention and detection of fraud and other irregularities.


17



E ACCOUNTABILITY AND AUDIT (cont'd)

(c) Internal Control

The Board has overall responsibility for maintaining a sound system of internal controls which provides reasonable assessment of effective and efficient operations, internal financial controls and compliance with laws and regulations as well as adherence with internal procedures and guidelines.

An overview of the state of internal controls within the Group is spelled out in this Annual Report under the Statement on Risk Management and Internal Control.

(d) Relationship with Auditors

The Board has established a transparent relationship with the external auditors through the Audit Committee, which has been accorded with the power to communicate directly with the external auditors towards ensuring compliance with the accounting standards and other related regulatory requirements.

The role of the Audit Committee in relation to the external auditors is stated under the Audit Committee Report of this Annual Report.

This statement is issued in accordance with a resolution of the Directors dated 28 May 2013

18

Annual Report 2012

A MEMBERS

The Audit Committee ("Committee") comprises the following members and details of attendance of each member at Committee meetings held during the financial year ended 31 December 2012 are as follows:-

Name of Committee Member No. of Meetings Attended

Teh Eng AunChairman / Independent Non-Executive Director

4/4

Abd Aziz Bin MatMember / Independent Non-Executive Director

4/4

Cheah Chin HuatMember / Independent Non-Executive Director

4/4

B TERMS OF REFERENCE

1. Objective

The primary objective of the Committee is to assist the Board of Directors (“Board”) in the effective discharge of its fiduciary responsibilities for corporate governance, timely and accurate financial reporting and development of sound internal controls.

2. Composition

The Committee shall be appointed by the Board from amongst their members and shall consist of not less than three (3) members and not more than five (5) members who shall:-

(a) Be Independent Non-Executive Directors of the Company.

(b) Not comprise persons having a relationship which in the opinion of the Board, would interfere with the exercise of independent judgment in carrying out the function of the Committee.

At least one of the Audit Committee:-

(i) must be a member of the Malaysian Institute of Accountants (“MIA”); or(ii) if he is not a member of the MIA, he must have at least three (3) years' working experience and:

• he must have passed the examinations specified in Part 1 of the First 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 First Schedule of the Accountants Act 1967; or

(iii) fulfills such other requirements as prescribed by the Bursa Malaysia Securities Berhad.

(c) The Chairman who shall be elected by the Audit Committee, must be an Independent Director.

(d) No alternate Director shall be appointed as a member of the Committee.

(e) If the number of members of committee is reduced to below three for reason of resignation, death or otherwise, the Board must appoint such member or new members as required to make up the minimum number of three members within three (3) months.

(f) The term of office and performance of the Committee and each of its the members shall be reviewed by the Board at least once every three (3) years to determine whether such Committee and its members have carried out their duties in accordance with the terms of reference.

Audit Committee Report

19


Audit Committee Report (cont'd)

B TERMS OF REFERENCE (cont'd)

3. Quorum

The quorum shall be not less than two (2) members, the majority of whom shall be Independent Non-Executive Directors.

4. Attendance and Frequency of Meeting

(a) The Committee shall meet not less than four (4) times a year and such additional meetings as the Chairman deems necessary. Members of the Committee and External Auditors may convene a meeting, with at least seven (7) days notices being served, if they consider it necessary. However, the Committee shall meet with the External Auditors at least twice a year without the presence of Executive Board members and the management staffs.

(b) Other Board members, the Head of' Finance, the Head of Internal Audit and a representative of External Auditor shall normally be invited to attend meetings. The Committee may invite other management and staff who the Committee thinks fit and proper to attend its meeting to assist in its deliberations and responsibilities of matters raised.

(c) In addition to the availability of detailed minutes of the Committee’s meetings to all Board members, the Committee at each Board meeting will report a summary of significant matters and resolutions.

(d) Detailed audit reports by Internal Auditors and the respective Management response are circulated to members of the Committee before each Meeting of the Committee at which the said reports are tabled.

5. Secretary

(a) The Company Secretary shall act as Secretary of the Committee and shall be responsible, concurrence of the Chairman, for drawing up and circulating the agenda, supported by explanatory documentation to the members prior to each meeting.

(b) The Secretary of the Committee shall be entrusted to record all proceedings and minutes of all meetings of the Committee.

(c) The Secretary shall be responsible for keeping the minutes of Committee’s meetings and circulating them to the members and the other members of the Board.

6. Authorities

The Committee is authorised by the Board whenever necessary and reasonable for performance of its duties:

(a) investigate any matter within its terms of reference;

(b) have adequate resources required to perform its duties;

(c) have full and unrestricted access to any information pertaining to the Group;

(d) obtain outside legal or other independent professional advice in the performance of its duties;

(e) have direct communication channels with the External Auditors, Internal Auditor and with senior management of the Group;

(f) convene meetings with the External Auditors, the Internal Auditors or both, excluding the attendance of other Directors and employees of the Group, whenever deemed necessary; and

(g) where the Committee is of the view that a matter reported by it to the Board has not been satisfactorily resolved resulting in a breach of the Main Marketing Listing Requirements of Bursa Malaysia Securities Berhad, the Committee shall promptly report such matter to the Bursa Securities.

20

Annual Report 2012

B TERMS OF REFERENCE (cont'd)

7. Duties and Responsibilities

The duties and responsibilities of the Committee are as follows:

(a) To consider the appointment of external Auditors, their remuneration and any question of resignation or dismissal.

(b) To review the annual audit plan with the external auditors and subsequent changes (if any).

(c) To consider and discuss with the external auditors before the audit commences, the nature, scope of audit and any difficulties and / or restriction encountered in the course of their audit work.

(d) To review the quarterly and year end financial statements before submission to the Board focusing particularly on:-

( i) any changes in accounting policies and practices;

(ii) significant and unusual events;

(iii) significant adjustments arising from audit;

(iv) the going concern assumption; and

(v) compliance with accounting standards and other legal and regulatory requirements

(e) To review results of the internal audit programme, receive all internal audit reports, consider the major findings of internal audit investigations and management response thereof.

(f) To review results of the internal audit process and, where necessary ensure appropriate actions are taken on the recommendations of the internal audit function.

(g) To review any related party transaction and conflict of interest situation that may arise within the Company or Group including any transaction, procedure or course of conduct that raises questions of management integrity; and

(h) To consider and examine such other matters as the Committee consider appropriate.

C SUMMARY OF ACTIVITIES OF THE COMMITTEE DURING THE YEAR

The activities performed by the Audit Committee during the financial year were:-

(a) Reviewed the audit plan of the external auditor, in term of the nature of the audit procedures, significant accounting and auditing issues, impact of new or proposed changes in the accounting standards and regulatory requirements.

(b) Reviewed the annual audited financial statements of the Group and made relevant recommendations to the Board of Directors for approval;

(c) Reviewed the related party transactions entered into by the Company and the Group to ensure that the transactions were at arm’s length basis and on normal commercial terms. The adequacy, appropriateness and compliance of the procedures established to monitor related party transactions;

(d) Reviewed the External Auditor and Internal Auditor audit plan, the nature and scope of audit for the financial year 2012 prior to the commencement of audit work;

(e) Reviewed and recommended to the Board the appointment of the External Auditor and their audit fee for financial year 2012;Reviewed the External Auditors’ audit findings, audit report and management letters including management’s response;


21



C SUMMARY OF ACTIVITIES OF THE COMMITTEE DURING THE YEAR (cont'd)

The activities performed by the Audit Committee during the financial year were:- (cont'd)

(f) Reviewed the internal audit report in respect of the audit recommendation, management response as well as actions taken to improve the system of internal control and procedures;

(g) Reviewed the Internal Auditor’s performance throughout the financial year 2012 to oversee the adequacy and effectiveness of the internal audit function; and

(h) The committee met with the external auditor twice during the year without the present of the executive directors and the management staffs.

D INTERNAL AUDIT FUNCTION

The Group's internal audit function is outsourced to an external professional firm specialising in internal audit and risk management which reports to the Audit Committee. During the financial year, the activities carried out by the Internal Auditors include amongst others:-(a) Follow-up review on previous internal audit reports in respect of the following areas:-

(i) Sales, Collection & Cash Management;(ii) Production/ Operations Management; and(iii) Sales, Marketing and Collection.

(b) Review of the adequacy, effectiveness and efficiency of the Group's internal control system over the following areas:- (i) Sales, Marketing and Collection; and(ii) Procurement Management.

This Audit Committee Report is made in accordance with the resolution of the Board of Directors dated 28 May 2013.

22

Annual Report 2012

INTRODUCTION

Pursuant to Paragraph 15.26 (b) of the Main Market Listing requirements of Bursa Malaysia Securities Berhad (“Bursa”), the Board of Directors (“Board”) of Multi-Usage Holdings Berhad is pleased to provide the following statement on the state of risk management and internal control of the Group, which has been prepared in accordance with the Statement on Internal Control: Guidance for Directors of Publics Listed Companies issued by the Institute of Internal Auditors Malaysia and adopted by Bursa Malaysia.

THE BOARD’S RESPONSIBILITIES

The Board has ultimate responsibility for the system of Risk Management and Internal Controls. Overall, the Board has established a risk management framework with the objective of setting clear guidelines in relation to the levels of risk acceptance to the Group. The system of Risk Management and Internal Controls is designed to meet the Group’s objectives and strategies, and the risks to which it is exposed.

The Risk Management and Internal Control System not only cover financial controls but operational and compliance controls and risk management. Due to limitations inherent in the system, this system can only manage rather than to eliminate the risk of failure to achieve business objectives. Therefore, any part of this system can only provide reasonable and not absolute assurance against material misstatement, operational failures, fraud or loss occurrence.

RISK MANAGEMENT FRAMEWORK

The Board will continue to update and review the Group's risk profile. The primary objective of risk management is to enhance the Group's ability to achieve its business objective. The Board is responsible to carry out periodical review on the adequacy and integrity of the Group's internal control system including systems to ensure compliance with applicable laws, regulations, rules, directives and guidelines. The Board further ensures that the risk management framework was in order throughout the year.

INTERNAL CONTROL AND INTERNAL AUDIT FUNCTION

IBDC (Malaysia) Sdn Bhd (“IBDC”), an independent professional firm, supports the Audit Committee, and by extension, the Board, by providing an independent assurance on the effectiveness of the Group’s system of internal control.

In particulars, IBDC appraises and contributes towards improving the Groups’ risk management and internal control systems and reports to the Audit Committee on a half yearly basis. In assessing the adequacy and effectiveness of the system of the internal control and financial control procedures of the Group, the Audit Committee reports to the Board on its activities, significant audit results or findings and the necessary recommendations or actions needed to be taken by management to rectify those issues.

The internal audit work plan, which reflects the risk profile of the Group’s major business sectors is routinely reviewed and approved by the Audit Committee. The scope of IBDC’s function covered the audit and review of governance, risk assessment, compliance, operational and financial controls across all business units.

The total cost incurred for the internal Audit function in respect of the financial year ended 31 December 2012 was RM18,000.00.

Statement of Risk Management and Internal Control

23


KEY PROCESSES OF RISK MANAGEMENT AND INTERNAL CONTROL

The other key elements of the Group’s internal control systems are described below:• Existence of Board of Committee such as Audit Committee, Nomination Committee and Remuneration Committee,

each with clearly defined terms of reference, authority and responsibility.

• Scheduled management meetings for each division and department to review operational matters, contingency plans, new requirements and updates.

• Continues practice of Employee’s Performance appraisal on yearly basis, and to align it with the Group’s policy and Reward scheme.

• Periodic internal audits are conducted by the internal auditors to monitor compliance with operating procedures and corporate governance with significant risks highlighted for the management and Board’s attention.

• The Audit Committee reviews the internal audit issues identified, and together with the management and with the assistance of the internal auditors devises action plans to rectify the weaknesses. Follow-up reviews are also conducted to ensure that the recommendations have been implemented accordingly.

• Comprehensive system of timely financial reporting to the Audit Committee and then to the Board of quarterly financial performance.

A numbered of the internal control weakness was indentified during the period and all of which have been, or are being, addressed. None of the weakness has resulted in any material losses, contingencies or uncertainties that would require disclosure in the Group’s annual report. CONCLUSION

The Board confirms that the system of Risk Management and Internal Control with the key control processes as listed above are in place during the financial year and there is a continuous process for indentifying, evaluating and managing significant risks to asses and enhance the effectiveness of the Risk Management and Internal Control System. The Board is of the view that the Risk Management and Internal Control System in place for the year under review and up to date of issuance of the financial statements is adequate and effective to safeguard the shareholders’ investment, the interest of customers, regulators and employees and the Group’s assets.

The Board is pleased to report that there were no significant material weaknesses in internal control resulting in significant losses. Management will continue to review the adequacy and integrity of the Group’s risk management and internal control system.

This statement was made in accordance with the Board of Directors' resolution dated 28 May 2013.

Statement of Risk Management and Internal Control (cont'd)

24

Annual Report 2012

Additional Compliance Information

The following information is provided in compliance with the Bursa Malaysia Securities Berhad (“Bursa Securities”)Main Market Listing Requirements for the financial year ended 31 December 2012:

Sanctions and/or Penalties There were no sanctions and/or penalties imposed on the Company and/or its subsidiaries, directors or management by any regulatory body during the financial year.

Share Buy-BacksThere were no share buy-backs by the Company during the financial year.

Options, Warrants or Convertible SecuritiesThe Company has not issued any options, warrants or convertibles securities during the financial year.

Utilisation of ProceedsThere were no proceeds raised by the Company from any corporate proposal during the financial year.

American Depository Receipts or Global Depository ReceiptsThe Company did not sponsor any American Depository Receipts or Global Depository Receipts programmes during the financial year.

Non-Audit feesThe total amount of non-audit fee payable to the external auditors by the Group for the financial year ended 31 December 2012 amounted to RM3,000.

Variation of ResultsThere were no variances of 10% or more between the results for the financial year and the unaudited results. The Company did not make any release on the profit estimate, forecast or projection for the financial year.

Profit GuaranteeThere was no profit guarantee given by the Company during the financial year.

Material ContractsThere were no material contracts entered into by the Company and/or it subsidiaries during the financial year which involves the interest of Directors and/or major shareholders.

25


The directors of MULTI-USAGE HOLDINGS BERHAD have pleasure in submitting their report and the audited financial statements of the Group and of the Company for the financial year ended December 31, 2012.

PRINCIPAL ACTIVITIES

The Company is principally involved in investment holding and the provision of management services. The principal activities of the subsidiary companies are disclosed in Note 15 to the financial statements. There have been no significant changes in the nature of the activities of the Group and of the Company during the financial year.

RESULTS OF OPERATIONS

The results of operations of the Group and of the Company for the financial year are as follows:

The Group The Company RM RM

Net profit/ (loss) after tax for the year 2,046,034 (1,103,301)

Profit/ (loss) attributable to:Equity holders of the Company 2,050,350 (1,103,301)Non-controlling interests (4,316) -

2,046,034 (1,103,301) In the opinion of the directors, the results of operations of the Group and of the Company during the financial year have not been substantially affected by any item, transaction or event of a material and unusual nature.

DIVIDENDS

No dividend has been paid or declared by the Company since the end of the previous financial year. The directors also do not recommend any dividend payment in respect of the current financial year.

RESERVES AND PROVISIONS

There were no material transfers to or from reserves or provisions during the financial year other than those disclosed in the financial statements.

ISSUE OF SHARES AND DEBENTURES

The Company has not issued any new shares or debentures during the financial year.

OTHER STATUTORY INFORMATION

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:

(a) to ascertain that proper action had been taken in relation to the writing off of bad debts and the making of allowance for doubtful debts, and have satisfied themselves that all known bad debts had been written off and that adequate allowance had been made for doubtful debts; and

(b) to ensure that any current assets which were unlikely to realise their book values in the ordinary course of business had been written down to their estimated realisable values.

Directors' Report

26

Annual Report 2012

Directors' Report (cont'd)

OTHER STATUTORY INFORMATION (cont'd)

As of December 31, 2012, the Company’s current liabilities have exceeded current assets by RM22,620,447. This factor raises substantial doubt as to whether the Company will be able to continue as a going concern. However, the financial statements have been prepared on a going concern basis which assumes that the Group and the Company will continue to be in operational existence for the foreseeable future having adequate funds to meet their obligations as they fall due. The validity of this assumption is largely dependent upon the continued support from the shareholders, bankers and creditors of the Group and the Company, the successful implementation of all the debts settlement plans as mentioned in Notes 26 and 29 to the financial statements and the ability of the Group and of the Company to generate profits and positive cash flows to sustain their operations.

The financial statements do not include any adjustments relating to the Group’s and to the Company’s recoverability and classification of recorded assets amounts or the amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern.

Other than as stated above, at the date of this report, the directors are not aware of any circumstances:

(a) which 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; or

(b) which would render the values attributed to current assets in the financial statements of the Group and of the Company misleading; or

(c) which have arisen which render adherence to the existing method of valuation of assets or liabilities of the Group and of the Company misleading or inappropriate; or

(d) not otherwise dealt with in this report or financial statements which would render any amount stated in the financial statements of the Group and of the Company misleading.

At the date of this report, there does not exist:

(a) any charge on the assets of the Group and of the Company which has arisen since the end of the financial year and secures the liability of any other person; or

(b) any contingent liability of the Group and of the Company which has arisen since the end of the financial year other than those disclosed in Note 32 to the financial statements.

Save as disclosed above, no contingent or other liability 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.

In the opinion of the directors, no item, transaction or event of a material and unusual nature has arisen in the interval between the end of the financial year and the date of this report which is likely to affect substantially the results of operations of the Group and of the Company for the succeeding financial year.

DIRECTORS

The following directors served on the Board of the Company since the date of the last report:

Ang Kim Cheng @ Ang Teng Kok Tan Chew Hua Abd. Aziz Bin MatCheah Chin Huat Teh Eng Aun

27


DIRECTORS’ INTEREST

The shareholdings in the Company of those who were directors at the end of the financial year, as recorded in the Register of Directors’ Shareholdings kept by the Company under Section 134 of the Companies Act, 1965, are as follows:

No. of ordinary shares of RM1 each

Shares in the CompanyBalance as of

1.1.2012 Bought SoldBalance as of

31.12.2012

Indirect interest:Ang Kim Cheng @ Ang Teng Kok* 16,616,104 - - 16,616,104Tan Chew Hua# 15,334,104 - - 15,334,104

* Deemed interest by virtue of shares held by companies in which the family members have interest# Deemed interest by virtue of shares held by a company in which the family members have interest

By virtue of their interests in the shares of the Company, Mr. Ang Kim Cheng @ Ang Teng Kok and Mr. Tan Chew Hua are also deemed to have beneficial interests in the shares of all subsidiary companies of Multi-Usage Holdings Berhad to the extent that Multi-Usage Holdings Berhad has an interest.

None of the other directors held shares or have beneficial interests in the shares of the Company or its subsidiary companies during the financial year.

DIRECTORS’ BENEFITS

Since the end of the previous financial year, none of the directors of the Company has received or become entitled to receive any benefit (other than those disclosed as directors’ remuneration 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 he is a member, or with a company in which he has a substantial financial interest.

During and at the end of the financial year, no arrangement subsisted to which the Company was a party whereby directors of the Company might acquire benefits by means of the acquisition of shares in, or debentures of, the Company or any other body corporate.

AUDITORS

The auditors, Messrs. Deloitte KassimChan, have indicated their willingness to continue in office.

Signed on behalf of the Boardin accordance with a resolution of the Directors,

ANG KIM CHENG @ ANG TENG KOK

TAN CHEW HUA

Penang,

April 24, 2013

Directors' Report (cont'd)

28

Annual Report 2012

Independent Auditors' Reportto the members of Multi-Usage Holdings Berhad (Incorporated in Malaysia)

Report on the Financial Statements

We have audited the financial statements of Multi-Usage Holdings Berhad, which comprise the statements of financial position of the Group and of the Company as of December 31, 2012, 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 year then ended, and a summary of significant accounting policies and other explanatory information, as set out on pages 30 to 81.

Directors’ Responsibility for the Financial Statements

The directors of the Company are responsible for the preparation of financial statements so as to give a true and fair view in accordance with Financial Reporting Standards and the requirements of the Companies Act, 1965 in Malaysia. The directors are also responsible for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

Auditors’ Responsibility

Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with approved standards on auditing in Malaysia. Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditors’ judgement, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditors consider internal control relevant to the entity’s preparation of financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by the directors, as well as evaluating the overall presentation of the financial statements.

We believe that the audit evidence that we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Opinion

In our opinion, the financial statements give a true and fair view of the financial position of the Group and of the Company as of December 31, 2012 and their financial performance and cash flows for the year then ended in accordance with Financial Reporting Standards and the Companies Act, 1965 in Malaysia.

Emphasis of Matter

Without qualifying our opinion, we draw attention to Note 2 to the financial statements. As of December 31, 2012, the Company’s current liabilities exceeded current assets by RM22,620,447. This factor raises substantial doubt as to whether the Company will be able to continue as a going concern. However, the financial statements have been prepared on a going concern basis which assumes that the Group and the Company will continue to be in operational existence for the foreseeable future having adequate funds to meet their obligations as they fall due. The validity of this assumption is largely dependent upon the continued support from the shareholders, bankers and creditors of the Group and the Company, the successful implementation of all the debts settlement plans as mentioned in Notes 26 and 29 to the financial statements and the ability of the Group and of the Company to generate profits and positive cash flows to sustain their operations. Should these assumptions be negated, the basis of preparation of the financial statements on the going concern basis may no longer be appropriate.

(Forward)

29


Independent Auditors' Report (cont'd)

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 by the subsidiary companies 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 accounts of the subsidiary companies that have been consolidated with the financial statements of the Company 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 as required by us for these purposes; and

(c) our auditors’ reports on the accounts of the subsidiary companies did not contain any qualification or any adverse comment made under Section 174(3) of the Act.

Other Reporting Responsibilities

The supplementary information set out in Note 35 to the financial statements 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 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.

Other Matters

The financial statements for certain subsidiary companies for the year ended December 31, 2011 were audited by another firm of auditors as mentioned in Note 15 to the financial statements, whose reports dated April 20, 2012 expressed an unqualified opinion on those financial statements.

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 towards any other person for the contents of this report.

DELOITTE KASSIMCHANAF 0080Chartered Accountants

LEE CHENG HEOHPartner – 2225/04/14 (J)Chartered Accountant

Penang

April 24, 2013

to the members of Multi-Usage Holdings Berhad (Incorporated in Malaysia)

30

Annual Report 2012

Statements of Comprehensive Income

The Group The CompanyNote 2012 2011 2012 2011

RM RM RM RM

Revenue 5 28,252,589 15,162,939 171,167 -

Investment revenue 6 93,917 74,700 - -

Other gains and losses 7 (21,727) 4,171,876 - 3,314,274

Other income 8 42,750 22,225 - -

Changes in inventories of finished goods and completed properties 110,836 (148,328) - -

Raw materials used (2,049,888) (3,328,110) - -

Purchase of trading goods (5,361,741) (1,616,856) - -

Property development expenditure recognised (8,333,230) (2,231,864) - -

Cost of developed properties sold (2,667,951) (3,441,562) - -

Contract costs recognised (39,694) - - -

Employee benefits expense 9 (2,680,195) (2,100,119) (105,852) (120,335)

Depreciation and amortisation expenses (208,979) (208,495) (131) (524)

Provision for corporate guarantee (705,973) (641,597) (705,973) (641,597)

Finance costs 10 (755,676) (1,428,312) (331,317) (882,538)

Other expenses (2,680,781) (1,783,199) (131,195) (146,911)

Profit before tax 2,994,257 2,503,298 (1,103,301) 1,522,369

Income tax expense 11 (948,223) (140,587) - -

Profit/ (loss) for the year 12 2,046,034 2,362,711 (1,103,301) 1,522,369

Other comprehensive income for the yearGain on revaluation of properties - 539,900 - -

Total comprehensive income/ (loss) for the year 2,046,034 2,902,611 (1,103,301) 1,522,369

(FORWARD)

for the year ended December 31, 2012

31



RM RM RM RM

Profit/ (loss) for the year attributable to:Equity holders of the Company 2,050,350 2,364,407 (1,103,301) 1,522,369Non-controlling interests (4,316) (1,696) - -

2,046,034 2,362,711 (1,103,301) 1,522,369

Other comprehensive income attributable to:Equity holders of the Company - 539,900 - -Non-controlling interests - - - -

- 539,900 - -

Earnings per share:Basic (sen per share) 13 3.89 4.48

Statements of Comprehensive Income (cont'd)for the year ended December 31, 2012

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

32

Annual Report 2012

Statements of Financial Position


RM RM RM RM

ASSETS

Non-current assetsProperty, plant and equipment 14 5,176,943 5,026,466 119 250Investment in subsidiary companies 15 - - 54,010,773 54,010,773Other financial asset 16 791 791 791 791Goodwill on consolidation 17 7,399,924 7,399,924 - -Property development costs 18 11,380,162 17,791,276 - -Deferred tax assets 19 104,000 - - -

Total non-current assets 24,061,820 30,218,457 54,011,683 54,011,814

Current assetsInventories 20 3,905,867 6,405,340 - -Property development costs 18 30,922,138 22,728,585 - -Trade and other receivables 21 3,211,777 3,043,757 196,937 36,304Refundable deposits 120,375 571,756 2,256 2,974Current tax assets - 29,834 - -Short-term deposits with licensed banks 22 218,526 215,745 - -Cash and bank balances 2,447,484 1,146,201 50,462 5,978

Total current assets 40,826,167 34,141,218 249,655 45,256

Total assets 64,887,987 64,359,675 54,261,338 54,057,070

(FORWARD)

as of December 31, 2012

33



RM RM RM RM

EQUITY AND LIABILITIES

Capital and reservesShare capital 24 52,728,000 52,728,000 52,728,000 52,728,000Reserves 25 18,739,462 18,739,462 17,043,264 17,043,264Accumulated losses (30,031,273) (32,081,623) (38,380,028) (37,276,727)

Total equity attributable to equity holders of the Company 41,436,189 39,385,839 31,391,236 32,494,537

Non-controlling interest 85,846 90,162 - -

Total equity 41,522,035 39,476,001 31,391,236 32,494,537

Non-current liabilitiesLoan creditor 26 - 2,905,327 - 2,905,327Hire purchase payable 27 109,658 - - -Deferred tax liabilities 19 8,000 8,000 - -

Total non-current liabilities 117,658 2,913,327 - 2,905,327

Current liabilitiesTrade and other payables 28 3,669,326 7,139,593 8,371,099 8,100,820Loan creditor 26 6,757,122 3,520,478 6,757,122 3,520,478Hire purchase payable 27 28,008 - - -Provision for corporate guarantee 29 7,741,881 7,035,908 7,741,881 7,035,908Bank overdraft 30 4,683,002 4,259,368 - -Tax liabilities 368,955 15,000 - -

Total current liabilities 23,248,294 21,970,347 22,870,102 18,657,206

Total liabilities 23,365,952 24,883,674 22,870,102 21,562,533

Total equity and liabilities 64,887,987 64,359,675 54,261,338 54,057,070

Statements of Financial Position (cont'd)as of December 31, 2012


34

Annual Report 2012

Statements of Changes In EquityTh

e G

roup

Shar

e ca

pita

lSh

are

prem

ium

Prop

ertie

s re

valu

atio

n re

serv

eA

ccum

ulat

ed

loss

es

Attr

ibut

able

to

equ

ity

hold

ers

of

the

Com

pany

Non

-co

ntro

lling

in

tere

stTo

tal

RM

RM

RM

RM

RM

RM

RM

Bal

ance

as

of J

anua

ry 1

, 201

1 52

,728

,000

17,0

43,2

641,

156,

298

(34,

446,

030)

36,4

81,5

3291

,858

36,5

73,3

90

Pro

fit/ (

loss

) for

the

year

--

-2,

364,

407

2,36

4,40

7(1

,696

)2,

362,

711

Oth

er c

ompr

ehen

sive

inco

me

for t

he y

ear

--

539,

900

-53

9,90

0-

539,

900

Tota

l com

preh

ensi

ve in

com

e/ (l

oss)

for

the

year

-

- 5

39,9

002,

364,

407

2,90

4,30

7(1

,696

)2,

902,

611

Bal

ance

as

of D

ecem

ber 3

1, 2

011

52,7

28,0

0017

,043

,264

1,69

6,19

8(3

2,08

1,62

3)39

,385

,839

90,1

6239

,476

,001

Bal

ance

as

of J

anua

ry 1

, 201

2 52

,728

,000

17,0

43,2

641,

696,

198

(32,

081,

623)

39,3

85,8

3990

,162

39,4

76,0

01

Pro

fit/ (

loss

) for

the

year

--

-2,

050,

350

2,05

0,35

0(4

,316

)2,

046,

034

Oth

er c

ompr

ehen

sive

inco

me

for t

he y

ear

--

--

--

-

Tota

l com

preh

ensi

ve in

com

e/ (l

oss)

for

the

year

-

--

2,05

0,35

02,

050,

350

(4,3

16)

2,04

6,03

4

Bal

ance

as

of D

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ber 3

1, 2

012

52,7

28,0

0017

,043

,264

1,69

6,19

8(3

0,03

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,436

,189

85,8

4641

,522

,035

(FO

RW

AR

D)


35


The Company

Share capital

Share premium

Accumulated losses Total

RM RM RM RM

Balance as of January 1, 2011 52,728,000 17,043,264 (38,799,096) 30,972,168

Profit for the year - - 1,522,369 1,522,369

Other comprehensive income for the year - - - -

Total comprehensive income for the year - - 1,522,369 1,522,369

Balance as of December 31, 2011 52,728,000 17,043,264 (37,276,727) 32,494,537

Balance as of January 1, 2012 52,728,000 17,043,264 (37,276,727) 32,494,537

Loss for the year - - (1,103,301) (1,103,301)

Other comprehensive income for the year - - - -

Total comprehensive loss for the year - - (1,103,301) (1,103,301)

Balance as of December 31, 2012 52,728,000 17,043,264 (38,380,028) 31,391,236

Statements of Changes In Equity (cont'd)for the year ended December 31, 2012


36

Annual Report 2012

Statements of Cash Flows

The Group The Company2012 2011 2012 2011RM RM RM RM

Cash flows from operating activitiesProfit/ (loss) for the year 2,046,034 2,362,711 (1,103,301) 1,522,369Adjustments for:

Income tax expense recognised in profit or loss 948,223 140,587 - -Provision for corporate guarantee 705,973 641,597 705,973 641,597Interest expense recognised in profit or loss 424,089 366,702 - -Interest on loan creditor carried at amortised cost 331,317 1,061,450 331,317 882,538Depreciation and amortisation of non-current assets 208,979 208,495 131 524Allowance for impairment loss 8,330 - - -Bad debts written off 5,265 23,652 - -Property, plant and equipment written off 5,132 - - -Rental receivables written off 3,000 - - -Interest revenue recognised in profit or loss (56,867) (17,338) - -Discount received from loan creditor for early

settlement - (4,109,274) - (3,314,274)Reversal of impairment loss recognised on trade

receivables - (52,514) - -Gain on disposal of property, plant and equipment - (33,740) - -

4,629,475 592,328 (65,880) (267,246)

(FORWARD)


37



RM RM RM RM

Movements in working capital:Decrease in inventories 2,499,473 3,088,771 - -Decrease in trade and other receivables 315,927 1,721,217 - -(Increase)/ decrease in refundable deposits (49,161) 57,721 718 -(Decrease)/ increase in trade and other

payables (3,376,360) 731,538 89,712 (26,398)Increase in property development costs (1,782,439) (937,880) - -

Cash generated from/ (used in) operations 2,236,915 5,253,695 24,550 (293,644)

Income taxes paid (668,434) (868,129) - -

Net cash generated from/ (used in) operating activities 1,568,481 4,385,566 24,550 (293,644)

Cash flows from investing activitiesInterest received 56,867 17,338 - -Payments for property, plant and equipment 31 (224,588) (154,965) - -Proceeds from disposal of non-current assets

classified as held for sale - 115,000 - -Net payment to subsidiary companies - - (160,633) (36,304)Additional investment in a subsidiary - - - (129,998)

Net cash used in investing activities (167,721) (22,627) (160,633) (166,302)

(FORWARD)

Statements of Cash Flows (cont'd)for the year ended December 31, 2012

38

Annual Report 2012

Statements of Cash Flows (cont'd)


RM RM RM RM

Cash flows from financing activitiesNet (repayment to)/ advances from directors (93,907) 75,246 (106,996) 35,000Short-term deposits held as security value (2,781) (2,588) - -Repayment of hire-purchase payable (2,334) - - -Interest paid (455) (3,637) - -Repayment of loan creditor - (3,628,213) - (2,831,849)Net advances from subsidiary companies - - 287,563 3,262,641

Net cash (used in)/ generated from financing activities (99,477) (3,559,192) 180,567 465,792

Net increase in cash and cash equivalents 1,301,283 803,747 44,484 5,846

Cash and cash equivalents at beginning of the year 1,146,201 342,454 5,978 132

Cash and cash equivalents at end of the year 31 2,447,484 1,146,201 50,462 5,978



39


1. GENERAL INFORMATION

The Company is a public limited liability company, incorporated and domiciled in Malaysia, and is listed on the Main Market of Bursa Malaysia Securities Berhad.

The Company is principally involved in investment holding and providing management services. The principal activities of the subsidiary companies are disclosed in Note 15. There have been no significant changes in the nature of the activities of the Group and of the Company during the financial year.

The registered office of the Company is located at Suite 2-1, 2nd Floor, Menara Penang Garden, 42A, Jalan Sultan Ahmad Shah, 10050 Penang.

The principal place of business of the Company is located at 15th Floor, Unit H, Wisma Boon Siew, No. 1, Penang Road, 10000 Penang, Malaysia respectively. The financial statements of the Group and of the Company were authorised for issue by the Board of Directors in accordance with a resolution of the directors on April 24, 2013.

2. BASIS OF PREPARATION OF FINANCIAL STATEMENTS

The financial statements of the Group and of the Company have been prepared in accordance with Financial Reporting Standards (“FRS”) and the provisions of the Companies Act, 1965 in Malaysia and also on the basis of accounting principles applicable to a going concern.

As of December 31, 2012, the Company’s current liabilities have exceeded current assets by RM22,620,447. This factor raises substantial doubt as to whether the Company will be able to continue as a going concern. However, the financial statements have been prepared on a going concern basis which assumes that the Group and the Company will continue to be in operational existence for the foreseeable future having adequate funds to meet their obligations as they fall due. The validity of this assumption is largely dependent upon the continued support from the shareholders, bankers and creditors of the Group and the Company, the successful implementation of all the debts settlement plans as mentioned in Notes 26 and 29 and the ability of the Group and of the Company to generate profits and positive cash flows to sustain their operations.

The financial statements do not include any adjustments relating to the Group’s and to the Company’s recoverability and classification of recorded assets amounts or the amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern.

In the current financial year, the Group and the Company have adopted all the new and revised FRSs and Issues Committee (“IC”) Interpretations issued by the Malaysian Accounting Standards Board (“MASB”) that are relevant to their operations and effective for the Group’s and the Company’s financial period beginning on January 1, 2012.

The adoption of the new and revised Standards and IC Interpretations have not materially affected the amounts reported on the financial statements.

At the date of authorisation for issue of these financial statements, the new and revised Standards and IC Interpretations (“IC Int.”) which were in issue but not yet effective and not early adopted by the Group and the Company are as listed below.

FRS 1 First-time Adoption of Financial Reporting Standards (Amendments relating to Government Loans) (a)

FRS 1 First-time Adoption of Financial Reporting Standards (Amendments relating to Repeated application of FRS 1 and Borrowing Costs) (a)

FRS 7 Financial Instruments: Disclosures (Amendments relating to Disclosures - Offsetting Financial Assets and Financial Liabilities) (a)

FRS 9 Financial Instruments (IFRS 9 issued by IASB in November 2009) (b) FRS 9 Financial Instruments (IFRS 9 issued by IASB in October 2010) (b)

FRS 10 Consolidated Financial Statements (a)

FRS 10 Consolidated Financial Statements, Joint Arrangements and Disclosure of Interests in Other Entities: Transition Guidance (Amendments to FRS 10, FRS 11 and FRS 12) (a)

Notes to the Financial StatementsDecember 31, 2012

40

Annual Report 2012

Notes to the Financial Statements (cont'd)

2. BASIS OF PREPARATION OF FINANCIAL STATEMENTS (cont'd)

FRS 11 Joint Arrangements (a)


FRS 12 Disclosure of Interests in Other Entities (a)


FRS 13 Fair Value Measurement (a)

FRS 101 Presentation of Financial Statements (Amendments relating to Presentation of Items of Other Comprehensive Income) (c)

FRS 101 Presentation of Financial Statements (Amendments relating to Clarification of the requirements for comparative information) (a)

FRS 116 Property, Plant and Equipment (Amendments relating to Classification of servicing equipment) (a)

FRS 119 Employee Benefits (2011) (a)

FRS 127 Separate Financial Statements (2011) (a)

FRS 128 Investment in Associates and Joint Ventures (2011) (a)

FRS 132 Financial Instruments: Presentation (Amendments relating to Tax effect of distribution to holders of equity instruments) (a)

FRS 132 Financial Instruments: Presentation (Amendments relating to Offsetting Financial Assets and Financial Liabilities) (d)

FRS 134 Interim Financial Reporting (Amendments relating to Interim financial reporting and segment information for total assets and liabilities) (a)

IC Int. 20 Stripping Costs in the Production Phase of a Surface Mine (a)

(a) Effective for annual periods beginning on or after January 1, 2013(b) Effective for annual periods beginning on or after January 1, 2015 instead of January 1, 2013 immediately upon

the issuance of Amendments to FRS 9 (IFRS 9 issued by IASB on November 2009 and October 2010 respectively) and FRS 7 relating to “Mandatory Effective Date of FRS 9 and Transition Disclosures” on March 1, 2012

(c) Effective for annual periods beginning on or after July 1, 2012(d) Effective for annual periods beginning on or after January 1, 2014

The directors anticipate that abovementioned Standards and IC Int. will be adopted in the annual financial statements of the Group and of the Company when they become effective and that the adoption of these FRSs and IC Int. will have no material impact on the financial statements of the Group and of the Company in the period of initial application except as discussed below.

The amendments to FRS 7 which are effective for annual periods beginning on or after January 1, 2013 introduce new disclosure requirements relating to rights of offset and related arrangements for financial instruments under an enforceable master netting agreements or similar arrangements. To date, the Group and the Company have not entered into any such agreements or similar arrangements. However, if the Group and the Company do enter into such arrangements in the future, the Group and the Company will need to comply with these disclosure requirements accordingly.

In November 2011, a package of five Standards on consolidation, joint arrangements, associates and disclosures was issued, including FRS 10, FRS 11, FRS 12, FRS 127 (as revised in 2011) and FRS 128 (as revised in 2011).

Key requirements of these five Standards are described below.

FRS 10 replaces the parts of FRS 127 Consolidated and Separate Financial Statements (revised in 2010) that deal with consolidated financial statements. IC Int. 112 Consolidation - Special Purpose Entities has been withdrawn upon the issuance of FRS 10. Under FRS 10, there is only one basis for consolidation, that is control. In addition, FRS 10 includes a new definition of control that contains three elements:

(a) power over an investee,(b) exposure, or rights, to variable returns from its involvement with the investee, and(c) the ability to use its power over the investee to affect the amount of the investor’s returns.

December 31, 2012

41



Extensive guidance has been added in FRS 10 to deal with complex scenarios.

FRS 11 replaces FRS 131 Interests in Joint Ventures. FRS 11 deals with how a joint arrangement of which two or more parties have joint control should be classified. IC Int. 113 Jointly Controlled Entities – Non-monetary Contributions by Venturers has been withdrawn upon the issuance of FRS 11. Under FRS 11, joint arrangements are classified as joint operations or joint ventures, depending on the rights and obligations of the parties to the arrangements. In contrast, under FRS 131, there are three types of joint arrangements: jointly controlled entities, jointly controlled assets and jointly controlled operations.

In addition, joint ventures under FRS 11 are required to be accounted for using the equity method of accounting, whereas jointly controlled entities under FRS 131 can be accounted for using the equity method of accounting or proportionate accounting.

FRS 12 is a disclosure standard and is applicable to entities that have interests in subsidiaries, joint arrangements, associates and/ or unconsolidated structured entities. In general, the disclosure requirements in FRS 12 are more extensive than those in the current standards.

In July 2012, amendments were made to FRS 10, FRS 11 and FRS 12 Consolidated Financial Statements, Joint Arrangements and Disclosure of Interests in Other Entities: Transition Guidance.

The amendment clarifies that the “date of initial application” in FRS 10 means “the beginning of the annual reporting period in which FRS 10 is applied for the first time”. Consequently, an entity is not required to adjust its previous accounting if:

(a) the consolidation conclusion reached upon the application of FRS 10 is the same as previous accounting; or(b) the entity had disposed of its interests in investees during a comparative period.

If an entity has to consolidate an investee that was not previously consolidated when applying FRS 10 or concludes that it will no longer consolidate an investee that was previously consolidated, the amendments limit the requirement to present adjusted comparative information to the period immediately preceding the date of initial application. However, the entity is not prohibited from presenting adjusted comparative information for earlier periods.

A similar relief is also provided in FRS 11 and FRS 12. Additionally, entities would no longer be required to provide disclosures for unconsolidated structured entities in periods prior to the first annual period that FRS 12 is applied.

If, upon applying FRS 10, an entity concludes that it shall consolidate an investee that was not previously consolidated and that control was obtained before the effective date of FRS 3 Business Combinations and FRS 127 Consolidated and Separate Financial Statements issued by the MASB in January 2010, the amendments provide the choice to Transitional Entities to apply either the earlier (i.e. as issued in February 2006) or the revised versions of FRS 3 and FRS 127 (as issued in January 2010).

FRS 13 establishes a single source of guidance for fair value measurements and disclosures about fair value measurements. The Standard defines fair value, establishes a framework for measuring fair value, and requires disclosures about fair value measurements. The scope of FRS 13 is broad; it applies to both financial instrument items and non-financial instrument items for which other FRSs require or permit fair value measurements and disclosures about fair value measurements, except in specified circumstances. In general, the disclosure requirements in FRS 13 are more extensive than those required in the current standards. For example, quantitative and qualitative disclosures based on the three-level fair value hierarchy currently required for financial instruments only under FRS 7 Financial Instruments: Disclosures will be extended by FRS 13 to cover all assets and liabilities within its scope.

The directors anticipate that FRS 13 will be adopted in the Group’s and the Company’s financial statements for the annual period beginning January 1, 2013 and that the application of the new Standard may affect the amounts reported in the financial statements and result in more extensive disclosures in the financial statements.

Notes to the Financial Statements (cont'd)December 31, 2012

42

Annual Report 2012

Notes to the Financial Statements (cont'd)


The amendments to FRS 101 relating to Presentation of Items of Other Comprehensive Income retain the option to present profit or loss and other comprehensive income in either a single statement or in two separate but consecutive statements. However, the amendments to FRS 101 require additional disclosures to be made in the other comprehensive income section such that items of other comprehensive income are grouped into two categories:

(a) items that will not be reclassified subsequently to profit or loss; and (b) items that will be reclassified subsequently to profit or loss when specific conditions are met.

Income tax on items of other comprehensive income is required to be allocated on the same basis.

The amendments to FRS 101 are effective for annual periods beginning on or after July 1, 2012. The presentation of items of other comprehensive income will be modified accordingly when the amendments are applied in the future accounting periods.

The amendments to FRS 101 relating to “Clarification of the requirements for comparative information” clarifies that an entity is required to present a third statement of financial position only if a retrospective application, retrospective restatement or reclassification has a material effect on the information in the statement of financial position at the beginning of the preceding period. Nevertheless, an entity may present comparative information in addition to the minimum comparative financial statements as long as that information is prepared in accordance with FRSs. In addition, the amendments clarify that other than the disclosure of certain specified information, related notes are not required to accompany the opening statement of financial position as at the beginning of the preceding period. The amendments will be applied accordingly when it becomes effective for application.

The amendment to FRS 116 clarifies that items such as spare parts, stand-by equipment and servicing equipment shall be recognised as property, plant and equipment when they meet the definition of property, plant and equipment. Otherwise, such items are classified as inventory. The amendment will be applied accordingly when it becomes effective for application.

FRS 124 (revised in 2010) has been revised on the following two aspects:

(a) FRS 124 (revised in 2010) has changed the definition of a related party; and(b) FRS 124 (as revised in 2009) introduces a partial exemption from the disclosure requirements for government-

related entities.

The Group and the Company are not government-related entities. Thus, the disclosure exemptions introduced in FRS 124 (revised in 2010) do not affect the Group and the Company. However, disclosures regarding related party transactions and balances in the Group’s and the Company’s financial statements may be affected when the revised version of the Standard is applied in future accounting periods because some counterparties that did not previously meet the definition of a related party may come within the scope of the Standard.

The amendments to FRS 132 which are effective for annual periods beginning on or after January 1, 2014 provide clarification on the meaning of “currently has a legally enforceable right of set-off” and “simultaneous realisation and settlement”. To date, the Group and the Company have not entered into any arrangements involving offsetting of financial instruments. However, if the Group and the Company do enter into such arrangements in the future, the amendments will affect the required accounting.

In addition, on November 19, 2011, the MASB issued a new MASB approved accounting framework, the Malaysian Financial Reporting Standards Framework (MFRS Framework) in conjunction with its planned convergence of FRSs with International Financial Reporting Standards (IFRS) as issued by the International Accounting Standards Board on January 1, 2012.

December 31, 2012

43



The MFRS Framework is a fully IFRS-compliant framework, equivalent to IFRSs which is mandatory for adoption by all Entities Other than Private Entities for annual periods beginning on or after January 1, 2012, with the exception for Transitioning Entities. Transitioning Entities, being entities which are subject to the application of MFRS 141 Agriculture and/ or IC Interpretation 15 Agreements for the Construction of Real Estate are given an option to defer adoption of the MFRS Framework for an additional one year. Transitioning Entities also includes those entities that consolidates, equity accounts or proportionately consolidates an entity that has chosen to continue to apply the FRS Framework for annual periods beginning on or after January 1, 2012. However, on June 30, 2012, the MASB decided to extend the aforementioned transitional period for another one year. Thus, Transitioning Entities are given an additional option to continue to apply the FRS Framework for annual periods beginning on or after January 1, 2013.Consequently, the MFRS Framework will be mandatory for application for annual periods beginning on or after January 1, 2014.

Accordingly, the Company being a Transitioning Entity, has availed itself of this transitional arrangement and will continue to apply FRSs in its next one set of financial statements.

Therefore, the Group and the Company will be required to apply MFRS 1 First-time Adoption of Malaysian Financial Reporting Standards (MFRS 1) in their financial statements for the financial year ending December 31, 2014, being the first set of financial statements prepared in accordance with the new MFRS Framework. Further, an explicit and unreserved statement of compliance with IFRSs will be made in these financial statements.

The Group and the Company are currently assessing the impact of adoption of MFRS 1, including identification of the differences in existing accounting policies as compared to the new MFRSs and the use of optional exemptions as provided for in MFRS 1. As at the date of authorisation of issue of the financial statements, accounting policy decisions or elections have not been finalised. Thus, the impact of adopting the new MFRS Framework on the Group’s and the Company’s first set of financial statements prepared in accordance with the MFRS Framework cannot be determined and estimated reliably until the process is complete.

3. SIGNIFICANT ACCOUNTING POLICIES

Basis of accounting

The financial statements of the Group and of the Company are presented in Ringgit Malaysia (“RM”) and have been prepared under the historical cost convention, unless otherwise indicated in the accounting policies stated below. Historical cost is generally based on their fair value of the consideration given in exchange for assets.

Subsidiary companies and basis of consolidation

The consolidated financial statements incorporate the financial statements of the Company and entities controlled by the Group (its subsidiary companies). Control is achieved where the Group has the power to govern the financial and operating policies of an entity so as to obtain benefits from its activities.

Subsidiary companies are consolidated using the purchase method of accounting. Under the purchase method of accounting, subsidiary companies are fully consolidated from the date on which control is transferred to the Group and are de-consolidated from the date that control ceases. The cost of an acquisition is measured at fair value of the assets given, equity instruments issued and liabilities incurred or assumed at the date of exchange, plus costs directly attributable to the acquisition.

The results of subsidiary companies acquired or disposed of during the year are included in the consolidated statement of comprehensive income from the effective date of acquisition and up to the effective date of disposal, as appropriate.

Where necessary, adjustments are made to the financial statements of subsidiary companies to bring their accounting policies into line with those used by other members of the Group.


44

Annual Report 2012

3. SIGNIFICANT ACCOUNTING POLICIES (cont'd)

Subsidiary companies and basis of consolidation (cont'd)

All intra-group transactions, balances, income and expenses are eliminated in full on consolidation.

Non-controlling interests in subsidiary companies are identified separately from the Group’s equity therein. The interests of non-controlling shareholders may be initially measured either at fair value or at the non-controlling interets’ proportionate share of the fair value of the acquiree’s identifiable net assets. The choice of measurement basis is made on an acquisition-by-acquisition basis. Subsequent to acquisition, the carrying amount of non-controlling interests is the amount of those interests at initial recognition plus the non-controlling interests’ share of subsequent changes in equity. Total comprehensive income is attributed to non-controlling interests even if this results in thenon-controlling interests having a deficit balance.

Changes in the Group’s interests in subsidiary companies that do not result in a loss of control are accounted for as equity transactions. The carrying amounts of the Group’s interests and the non-controlling interests are adjusted to reflect the changes in their relative interests in the subsidiaries. Any difference between the amount by which the non-controlling interests are adjusted and the fair value of the consideration paid or received is recognised directly in equity and attributed to owners of the Company.

When the Group losses control of a subsidiary companies, the profit or loss on disposal is calculated as the difference between:

(a) the aggregate of the fair value of the consideration received and the fair value of any retained interest; and

(b) the previous carrying amount of the assets (including goodwill), and liabilities of the subsidiary companies and any non-controlling interests.

Amounts previously recognised in other comprehensive income in relation to the subsidiary companies are accounted for (i.e. reclassified to profit or loss or transferred directly to retained earnings) in the same manner as would be required if the relevant assets or liabilities were disposed of. The fair value of any investment retained in the former subsidiary companies at the date when control is lost is regarded as the fair value on initial recognition for subsequent accounting under FRS 139 Financial Instruments: Recognition and Measurement or, when applicable, the cost on initial recognition of an investment in an associate or jointly controlled entity.

Subsidiary companies

Investment in subsidiary companies which are eliminated on consolidation, are stated at cost less impairment losses, in the Company’s separate financial statements.

Business combinations

Acquisitions of subsidiary companies and businesses are accounted for using the acquisition method. The consideration for each acquisition is measured at the aggregate of the fair values (at the date of exchange) of assets given, liabilities incurred or assumed, and equity instruments issued by the Group in exchange for control of the acquiree. Acquisition-related costs are recognised in profit or loss as incurred.

Goodwill

Goodwill arising on the acquisition of a subsidiary company involved in property development represents the excess of the cost of acquisition over the Group’s interest in the net fair value of the identifiable assets and liabilities of the subsidiary recognised at the date of acquisition.


45



Goodwill (cont'd)

Goodwill is not amortised but is reviewed for impairment at least annually. For the purpose of impairment testing, goodwill is allocated to each of the Group’s cash-generating units expected to benefit from the synergies of the combination. Cash-generating units to which goodwill has been allocated are tested for impairment annually, or more frequently when there is an indication that the unit may be impaired. If the recoverable amount of the cash-generating unit is less than its carrying amount, the impairment loss is allocated first to reduce the carrying amount of any goodwill allocated to the unit and then to the other assets of the unit pro-rata on the basis of the carrying amount of each asset in the unit. An impairment loss recognised for goodwill is not reversed in a subsequent period.

The recoverable amount of the cash generating unit is determined based on a value in use calculation which uses cash flow projections based on financial budgets approved by management covering a five-year period, and a discount rate of 8% per annum.

On disposal of a subsidiary, the attributable amount of goodwill is included in the determination of the profit or loss on disposal.

Non-current assets held for sale

Non-current assets and disposal groups are classified as held for sale if their carrying amount will be recovered principally through a sale transaction rather than through continuing use. This condition is regarded as met only when the sale is highly probable and the non-current asset (or disposal group) is available for immediate sale in its present condition. Management must be committed to the sale, which should be expected to qualify for recognition as a completed sale within one year from the date of classification.

Revenue recognition

Revenue is measured at the fair value of the consideration received or receivable. Revenue is reduced for estimated customer returns, rebates and other similar allowances.

(a) Sale of goods Revenue from the sale of goods is recognised when all the following conditions are satisfied:

(i) the Group has transferred to the buyer the significant risks and rewards of ownership of the goods;(ii) the Group retains neither continuing managerial involvement to the degree usually associated with

ownership nor effective control over the goods sold;(iii) the amount of revenue can be measured reliably;(iv) it is probable that the economic benefits associated with the transaction will flow to the Group; and(v) the costs incurred or to be incurred in respect of the transaction can be measured reliably.

(b) Income from property development projects and construction contracts

Revenue relating to property development activities are accounted for based on the percentage of completion method on development units that have been sold. The stage of completion is determined by survey of work performed. All anticipated losses on property development projects are fully provided for.

Revenue from the sale of completed property unit is measured at the fair value of the consideration received or receivable and is recognised when the entity has transferred the significant risks and rewards of ownership of the unit, and when it is probable that the economic benefits associated with the transaction will flow to the entity and the amount of revenue can be measured reliably.


46

Annual Report 2012


Revenue recognition (cont'd)

(c) Interest revenue

Interest revenue is recognised when it is probable that the economic benefits will flow to the Group and the amount of revenue can be measured reliably. Interest revenue is accrued on a time basis, by reference to the principal outstanding and at the effective interest rate applicable, which is the rate that exactly discounts estimated future cash receipts through the expected life of the financial asset to that asset’s net carrying amount on initial recognition.

(d) Rental revenue

Rental revenue from operating leases is recognised on a straight-line basis over the term of the relevant lease. Initial direct costs incurred in negotiating and arranging an operating lease are added to the carrying amount of the leased asset and recognised on a straight-line basis over the lease term.

(e) Other income

Management fee and other income are recognised on an accrual basis.

Short-term employee benefits

Wages, salaries, paid annual leave, bonuses and social security contributions are recognised as expenses in the year in which the associated services are rendered by employees of the Group and of the Company. Short-term accumulating compensated absences such as paid annual leave are recognised when services are rendered by the employees that increase their entitlement to future compensated absences. Short-term non-accumulating compensated absences such as sick leave are recognised when the absences occur.

Retirement benefit costs

Contributions to defined contribution retirement benefit plans are recognised as an expense when employees have rendered service entitling them to the contributions. The Group and the Company have no further payment obligations once these contributions have been paid. Borrowing costs

Borrowing costs directly attributable to the acquisition, construction or production of qualifying assets, which are assets that necessarily take a substantial period of time to get ready for their intended use or sale, are added to the cost of those assets, until such time as the assets are substantially ready for their intended use or sale.

All borrowing costs are recognised in profit or loss in the period in which they are incurred.

Taxation

Income tax expense represents the sum of the tax currently payable and deferred tax.

(a) Current tax

The tax currently payable is based on taxable profit for the year. Taxable profit differs from profit as reported in the statement of comprehensive income because of items of income or expense that are taxable or deductible in other years and items that are never taxable or deductible. The Group’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the end of the reporting period.


47



Taxation (cont'd)

(b) Deferred tax

Deferred tax is recognised on temporary differences between the carrying amounts of assets and liabilities in the financial statements and the corresponding tax bases used in the computation of taxable profit. Deferred tax liabilities are generally recognised for all taxable temporary differences. Deferred tax assets are generally recognised for all deductible temporary differences, unused tax losses and unused tax credits to the extent that it is probable that taxable profits will be available against which those deductible temporary differences, unused tax losses and unused tax credits can be utilised. Such deferred tax assets and liabilities are not recognised if the temporary difference arises from the initial recognition (other than in a business combination) of other assets and liabilities in a transaction that affects neither the taxable profit nor the accounting profit.

The carrying amount of deferred tax assets is reviewed at the end of each reporting period and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered.

Deferred tax assets and liabilities are measured at the tax rates that are expected to apply in the period in which the liability is settled or the asset is realised, based on tax rates (and tax laws) that have been enacted or substantively enacted by the end of the reporting period. The measurement of deferred tax liabilities and assets reflects the tax consequences that would follow from the manner in which the Group expects, at the end of the reporting period, to recover or settle the carrying amount of its assets and liabilities.

Deferred tax assets and liabilities are offset when there is a legally enforceable right to set off current tax assets against current tax liabilities and when they relate to income taxes levied by the same taxation authority and the Group intends to settle its current tax assets and liabilities on a net basis.

(c) Current and deferred tax for the period

Current and deferred tax are recognised as an expense or income in profit or loss, except when they relate to items that are recognised outside profit or loss (whether in other comprehensive income or directly in equity), in which case the tax is also recognised outside profit or loss.

Leasing

Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessee. All other leases are classified as operating leases.

(a) The Group as lessor

Amounts due from lessees under finance leases are recognised as receivables at the amount of the Group’s net investment in the leases. Finance lease income is allocated to accounting periods so as to reflect a constant periodic rate of return on the Group’s net investment outstanding in respect of the leases.

Rental income from operating leases is recognised on a straight-line basis over the term of the relevant lease. Initial direct costs incurred in negotiating and arranging an operating lease are added to the carrying amount of the leased asset and recognised on a straight-line basis over the lease term.

(b) The Group as lessee

Lease payments are apportioned between finance expenses and reduction of the lease obligation so as to achieve a constant rate of interest on the remaining balance of the liability. Finance expenses are recognised immediately in profit or loss, unless they are directly attributable to qualifying assets, in which case they are capitalised in accordance with the Group’s general policy on borrowing costs. Contingent rentals are recognised as expenses in the periods in which they are incurred.


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Annual Report 2012


Leasing (cont'd)

(b) The Group as lessee (cont'd)

Operating lease payments are recognised as an expense on a straight-line basis over the lease term, except where another systematic basis is more representative of the time pattern in which economic benefits from the leased asset are consumed. Contingent rentals arising under operating leases are recognised as an expense in the period in which they are incurred.

In the event that lease incentives are received to enter into operating leases, such incentives are recognised as a liability. The aggregate benefit of incentives is recognised as a reduction of rental expense on a straight-line basis, except where another systematic basis is more representative of the time pattern in which economic benefits from the leased asset are consumed.

Property, plant and equipment

Land held for use in the production or supply of goods or services, or for administrative purposes, are stated in the statement of financial position at their revalued amounts, being the fair value at the date of revaluation, less any subsequent accumulated depreciation and subsequent accumulated impairment losses. Revaluations are performed with sufficient regularity such that the carrying amounts do not differ materially from those that would be determined using fair values at the end of the reporting period.

Any revaluation increase arising on the revaluation of such land is recognised in other comprehensive income, except to the extent that it reverses a revaluation decrease for the same asset previously recognised in profit or loss, in which case the increase is credited to profit or loss to the extent of the decrease previously expensed. A decrease in the carrying amount arising on the revaluation of such land is recognised in profit or loss to the extent that it exceeds the balance, if any, held in the properties revaluation reserve relating to a previous revaluation of that asset.

Depreciation on revalued properties is recognised in profit or loss. On the subsequent sale or retirement of a revalued property, the attributable revaluation surplus remaining in the properties revaluation reserve is transferred directly to retained earnings.

Freehold land is not depreciated. All other property, plant and equipment are stated at cost less accumulated depreciation and impairment losses.

Depreciation is recognised so as to write off the cost of assets less their residual values over their useful lives, using the straight-line method, on the following bases: Factory buildings 5%Plant and machinery 10%Motor vehicles 10% and 20%Forklifts and excavators 10%Tools, mould, trays and pallets 20%Office equipment, furniture and fittings 10% and 40%Factory equipment 10%Apartments 2%

The estimated useful lives, residual values and depreciation method are reviewed at each year end, with the effect of any changes in estimate accounted for on a prospective basis.

The gain or loss arising on the disposal or retirement of an item of property, plant and equipment is determined as the difference between the sales proceeds and the carrying amount of the asset and is recognised in profit or loss.


49



Impairment of tangible assets

At the end of each reporting period, the Group reviews the carrying amounts of its tangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the Group estimates the recoverable amount of the cash-generating unit to which the asset belongs.

Recoverable amount is the higher of fair value less costs to sell and 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 risks specific to the asset for which the estimates of future cash flows have not been adjusted.

If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the impairment loss is treated as a revaluation decrease.

Where an impairment loss subsequently reverses, the carrying amount of the asset (or cash-generating unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset (or cash-generating unit) in prior years. A reversal of an impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the reversal of the impairment loss is treated as a revaluation increase. Inventories

Inventories are valued at the lower of cost and net realisable value. Cost of raw materials consists of original purchase price plus the cost incurred in bringing the inventories to their present location. Finished goods consist of cost of raw materials, direct labour and an appropriate proportion of factory overheads. Cost of raw materials and finished goods are determined on the first-in, first-out method. Cost of developed properties comprises cost of land and the relevant development cost and is determined on the specific identification basis.

Net realisable value represents the estimated selling price in the ordinary course of business less selling and distribution costs and all other estimated costs to completion.

Property development activities

Land held for property development is stated at cost less accumulated impairment losses, if any.

Property development revenue comprises the selling price agreed in the sale and purchase agreement and any additional revenue due to variation in development work. Property development costs comprise costs associated with the acquisition of land, costs related directly to a specific development project and other costs attributable to development activities in general and can be allocated to such activities. The portion of property development costs for development projects where no development activities have been carried out or where development activities are not expected to be completed within the normal operating cycle is classified as non-current assets. All other property development costs are classified as current assets.

When the outcome of a development activity can be estimated reliably, property development revenue and costs attributable to the development units sold are recognised in profit or loss by reference to the stage of completion of the development activity at the balance sheet date. The stage of completion is determined by reference to the proportion that property development costs incurred to date bear to the estimated total costs.


50

Annual Report 2012


Property development activities (cont'd)

When the outcome of a development activity cannot be estimated reliably, property development revenue is recognised in profit or loss only to the extent of property development costs incurred that are probable to be recoverable whereas property development costs attributable to the development units sold are recognised in profit or loss in the period in which they are incurred. Any expected loss on a development project is recognised as an expense immediately.

Construction contracts

Where the outcome of a construction contract can be reliably estimated, contract revenue and contract costs are recognised as revenue and expenses respectively by using the percentage of completion method. The percentage of completion is measured by reference to the proportion of contract costs incurred or work performed to date bear to the estimated total contract costs.

Where the outcome of a construction contract cannot be reliably estimated, contract revenue is recognised to the extent of contract costs incurred that are probable of recovery. Contract costs are recognised as expenses in the period in which they are incurred.

When it is probable that total contract costs will exceed total contract revenue, the expected loss is recognised as an expense immediately.

When the total costs incurred on construction contracts plus recognised profits (less recognised losses), exceeds progress billings, the balance is classified as amount due from customers on contracts. When progress billings exceed costs incurred plus recognised profits (less recognised losses), the balance is classified as amount due to customers on contracts.

Provisions

Provision are recognised when the Group has a present obligation (legal or constructive) as a result of a past event, it is probable that the Group and the Company will be required to settle the obligation, and a reliable estimate can be made of the amount of the obligation.

The amount recognised as a provision is the best estimate of the consideration required to settle the present obligation at the end of the reporting period, taking into account the risks and uncertainties surrounding the obligation. Where a provision is measured using the cash flows estimated to settle the present obligation, its carrying amount is the present value of those cash flows.

When some or all of the economc benefits required to settle a provision are expected to be recovered from a third party, a receivable is recognised as an asset if it is virtually cetrain that reimbursement will be received and the amount of the receivable can be measured reliably.

Financial instruments

Financial instruments are recognised in the statement of financial position when, and only when, the Group become a party to the contractual provisions of the financial instruments.

Where the purchase or sale of a financial asset is under a contract whose terms require delivery of the financial asset within the timeframe established by the market concerned, such financial assets are recognised and derecognised on trade date.

Financial instruments are initially measured at fair value, plus transaction costs, except for those financial assets classified as at fair value through profit or loss, which are initially measured at fair value.


51



Financial instruments (cont'd)

(a) Financial assets

Financial assets of the Group are classified into the following specified categories: ‘available-for sale’ (AFS) financial assets and ‘loans and receivables’. The classification depends on the nature and purpose of the financial assets and is determined at the time of initial recognition.

(i) Effective interest method

The effective interest method is a method of calculating the amortised cost of a financial asset and of allocating interest income over the relevant period. The effective interest rate is the rate that exactly discounts estimated future cash receipts (including all fees on points paid or received that form an integral part of the effective interest rate, transaction costs and other premiums or discounts) through the expected life of the financial asset, or (where appropriate) a shorter period, to the net carrying amount on initial recognition.

Income is recognised on an effective interest basis for debt instruments other than those financial assets classified as at fair value through profit or loss.

(ii) AFS financial assets

AFS financial assets are non-derivatives that are either designated as available-for-sale or are not classified as loans and receivables, held-to-maturity investments or financial assets at fair value through profit or loss. All AFS assets are measured at fair value at the end of the reporting period. Gains and losses arising from changes in fair value are recognised in other comprehensive income and accumulated in the investments revaluation reserve, with the exception of impairment losses, interest calculated using the effective interest method, and foreign exchange gains and losses on monetary assets, which are recognised in profit or loss. Where the investment is disposed of or is determined to be impaired, the cumulative gain or loss previously accumulated in the investments revaluation reserve is reclassified to profit or loss.

AFS equity investments that do not have a quoted market price in an active market and whose fair value cannot be reliably measured and derivatives that are linked to and must be settled by delivery of such unquoted equity investments are measured at cost less any identified impairment losses at the end of the reporting period.

(iii) Loans and receivables

Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market. Loans and receivables are measured at amortised cost using the effective interest method, less any impairment. Interest income is recognised by applying the effective interest rate, except for short-term receivables when the recognition of interest would be immaterial.

(iv) Impairment of financial assets

Financial assets, other than those at fair value through profit or loss, are assessed for indicators of impairment at the end of each reporting period. Financial assets are considered to be impaired when there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows of the investment have been affected.

For all other financial assets, objective evidence of impairment could include:

(i) significant financial difficulty of the issuer or counterparty; or(ii) default or delinquency in interest or principal payments; or(iii) it becoming probable that the borrower will enter bankruptcy or financial re-organisation.


52

Annual Report 2012



(a) Financial assets (cont'd)

(iv) Impairment of financial assets (cont'd)

For certain categories of financial asset, such as trade receivables, assets that are assessed not to be impaired individually are, in addition, assessed for impairment on a collective basis. Objective evidence of impairment for a portfolio of receivables could include the Group’s past experience of collecting payments, an increase in the number of delayed payments in the portfolio past the average credit periods of 30 to 90 days, as well as observable changes in national or local economic conditions that correlate with default on receivables.

For financial assets carried at amortised cost, the amount of the impairment loss recognised is the difference between the asset’s carrying amount and the present value of estimated future cash flows, discounted at the financial asset’s original effective interest rate.

The carrying amount of the financial asset is reduced by the impairment loss directly for all financial assets with the exception of trade receivables, where the carrying amount is reduced through the use of an allowance account. When a trade receivable is considered uncollectible, it is written off against the allowance account. Subsequent recoveries of amounts previously written off are credited against the allowance account. Changes in the carrying amount of the allowance account are recognised in profit or loss.

If, in a subsequent period, the amount of the impairment loss decreases and the decrease can be related objectively to an event occurring after the impairment was recognised, the previously recognised impairment loss is reversed through profit or loss to the extent that the carrying amount of the investment at the date the impairment is reversed does not exceed what the amortised cost would have been had the impairment not been recognised.

(v) Derecognition of financial assets

The Group derecognises a financial asset only when the contractual rights to the cash flows from the asset expire, or when it transfers the financial asset and substantially all the risks and rewards of ownership of the asset to another entity. If the Group neither transfers nor retains substantially all the risks and rewards of ownership and continues to control the transferred asset, the Group recognises its retained interest in the asset and an associated liability for amounts it may have to pay. If the Group retains substantially all the risks and rewards of ownership of a transferred financial asset, the Group continues to recognise the financial asset and also recognises a collateralised borrowing for the proceeds received.

(b) Financial liabilities and equity instruments issued by the Group and the Company

(i) Classification as debt or equity

Debt and equity instruments are classified as either financial liabilities or as equity in accordance with the substance of the contractual arrangement.

(ii) Equity instruments

An equity instrument is any contract that evidences a residual interest in the assets of an entity after deducting all of its liabilities. Equity instruments issued by the Company are recognised at the proceeds received, net of direct issue costs.


53




(b) Financial liabilities and equity instruments issued by the Group and the Company (cont'd)

(iii) Financial liabilities

Financial liabilities are classified as either financial liabilities at fair value through profit or loss or other financial liabilities.

(iv) Other financial liabilities

Other financial liabilities, including borrowings, are initially measured at fair value, net of transaction costs.

Other financial liabilities are subsequently measured at amortised cost using the effective interest method, with interest expense recognised on an effective yield basis.

The effective interest method is a method of calculating the amortised cost of a financial liability and of allocating interest expense over the relevant period. The effective interest rate is the rate that exactly discounts estimated future cash payments through the expected life of the financial liability, or (where appropriate) a shorter period, to the net carrying amount on initial recognition.

(v) Derecognition of financial liabilities

The Group derecognises financial liabilities when, and only when, the Group’s obligations are discharged, cancelled or they expire.

Contingent liabilities

A contingent liability is disclosed, unless the possibility of an outflow of resources embodying economic benefits is remote except for cases where the amount involved is material and the directors are of the opinion that disclosure is appropriate.

Cash and cash equivalents

The Group and the Company adopt the indirect method in the preparation of the statements of cash flows.

Cash and cash equivalents comprise cash and bank balances (including the balances in Housing Development Accounts), demand deposits which are not pledged and highly liquid investments which are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value.

4. CRITICAL ACCOUNTING JUDGEMENTS AND KEY SOURCES OF ESTIMATION UNCERTAINTY

In the application of the Group’s accounting policies, which are described in Note 3, the directors are required to make judgements, estimates and assumptions about the carrying amounts of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised if the revision affects only that period, or in the period of the revision and future periods if the revision affects both current and future periods.


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Annual Report 2012

4. CRITICAL ACCOUNTING JUDGEMENTS AND KEY SOURCES OF ESTIMATION UNCERTAINTY (cont'd)

(a) Critical judgements in applying the Group’s accounting policies

In the process of applying the Group’s accounting policies, the directors are of the opinion that there are no instances of application of judgement which are expected to have a significant effect on the amounts recognised in the financial statements.

The Group recognises property development revenue and costs by reference to the stage of completion of the development activity. The determination of the stage of completion involves estimating the outcome of the development activity based on past experience and work of specialists.

(b) Key sources of estimation uncertainty

The following are the key assumptions concerning the future, and other key sources of estimation uncertainty at the end of the reporting period, that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year.

(i) Impairment of investment in subsidiary companies

Determining whether investment in subsidiary companies are impaired requires an estimation of the value in use of the cash-generating units. The value in use calculation requires the Company to estimate the future cash flows expected to arise from the cash-generating unit and a suitable discount rate in order to calculate present value. The carrying amount of the Company’s investment in subsidiary companies (including amount owing by subsidiary companies which are equity instruments in substance) as of December 31, 2012 was RM54,010,773 (2011: RM54,010,773) after an impairment loss of RM7,169,978 (2011: RM7,169,978).

(ii) Impairment of goodwill

Determining whether goodwill is impaired required an estimation of the value in use of the cash-generating units to which goodwill has been allocated. The value in use calculation requires the directors to estimate the future cash flows expected to arise from the cash-generating unit and a suitable discount rate in order to calculate present value.

The carrying amount of goodwill at the end of the reporting period was RM7,399,924 (2011: RM7,399,924). The Group assessed the recoverable amount of goodwill and determined that there was no impairment for goodwill need to be recognised.

(iii) Impairment of property, plant and equipment

The Group assesses whether there are any indicators of impairment for all non-financial assets at each reporting date. Other non-financial assets are tested for impairment when there are indicators that the carrying amounts may not be recoverable.

If there are indicators of impairment in property, plant and equipment, the Group carries out the impairment test based on a variety of estimation including the value in use of the cash-generating units to which the property, plant and equipment is allocated. Estimating the value in use requires the Group to make an estimate of the expected future cash flows from the cash-generating units and also to choose a suitable discount rate in order to calculate the present value of those cash flows.

During the current financial year, the Group assessed and determined that there was no indicator of impairment for property, plant and equipment.


55


4. CRITICAL ACCOUNTING JUDGEMENTS AND KEY SOURCES OF ESTIMATION UNCERTAINTY (cont'd)

(b) Key sources of estimation uncertainty (cont'd)

(iv) Impairment of receivables

The Group assesses at each reporting date whether there is any objective evidence that a financial asset is impaired. To determine whether there is objective evidence of impairment, the Group considers factors such as the probability of insolvency or significant financial difficulties of the debtor and default or significant delay in payments. Where there is objective evidence of impairment, the amount and timing of future cash flows are estimated based on historical loss experience for assets with similar credit risk characteristics. Where the expectation is different from the original estimate, such difference will impact the carrying value of the receivables in the period in which such estimate has been changed.

(v) Impairment of properties development costs

The Company recognises property development revenue and expenses in the profit or loss by using the stage of completion method. The stage of completion is determined by survey of work performed.

Significant judgement is required in determining the stage of completion, the extent of the property development costs incurred, the estimated total property development revenue and costs, as well as the recoverability of the development projects. In making the judgement, the Company evaluates based on past experience and by relying on the work of specialists.

(vi) Provision for corporate guarantee

Provision for corporate guarantee represents liability expected to crystallise from corporate guarantee executed by the Company in favour of a licensed bank in respect of credit facility granted to a former subsidiary company, Perlis Concrete Products Sdn. Bhd.. The amount recognised as a provision is the best estimate of the consideration required to settle the present obligation at the end of the reporting period, taking into account the risks and uncertainties surrounding the obligation. Where the expectation is different from the original estimate, such difference will impact the carrying value of the receivables in the period in which such estimate has been changed.

5. REVENUE


Revenue from property development 18,603,120 8,416,767 - -Sale of goods and services 9,649,469 6,746,172 - -Management fee - - 171,167 -

28,252,589 15,162,939 171,167 -


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Annual Report 2012

6. INVESTMENT REVENUE

The Group2012 2011RM RM

Rental revenue from premises 37,050 57,362Interest revenue on short-term deposits 3,162 2,588Other interest revenue 53,705 14,750

93,917 74,700

The following is an analysis of investment revenue earned on financial assets by category of asset:


Loan and receivables (including cash and bank balances) 56,867 17,338Investment income earned on non-financial assets 37,050 57,362

93,917 74,700

7. OTHER GAINS AND LOSSES


Allowance for impairment loss (8,330) - - -Bad debts written off (5,265) (23,652) - -Property, plant and equipment written off (5,132) - - -Rental receivable written off (3,000) - - -Discount received from loan creditor for early

settlement - 4,109,274 - 3,314,274Reversal of impairment loss on trade receivables - 52,514 - -Gain on disposal of property, plant and equipment - 33,740 - -

(21,727) 4,171,876 - 3,314,274


57


8. OTHER INCOME


Transport charges received 4,760 -Handling charges 2,515 5,053Recovery of legal costs - 12,933Others 35,475 4,239

42,750 22,225

9. EMPLOYEE BENEFITS EXPENSE

Employee benefits expense recognised as an expense during the financial year is as follows:


Contribution to employees provident fund 220,287 174,595 - -Other employee benefits expense 2,459,908 1,925,524 105,852 120,335

2,680,195 2,100,119 105,852 120,335

Employee benefits expense of the Group and of the Company includes directors’ remuneration, salaries, bonuses, contribution to employees provident fund and all other employee related expenses.

Details of the remuneration of the directors who are the key management personnel of the Group and of the Company are as follows:


Directors of the Company:Executive directors:

Fees 10,000 15,000 10,000 15,000Contribution to employees provident fund 46,800 38,100 - -Other emoluments 478,500 350,063 3,500 4,000

Non-executive directors:Fees 66,000 72,000 66,000 72,000Other emoluments 6,000 12,000 6,000 12,000

Director of subsidiary companies:Executive directors:

Fees 30,000 24,000 - -Contribution to employees provident fund 17,256 13,600 - -Other emoluments 176,800 133,500 - -

831,356 658,263 85,500 103,000


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Annual Report 2012

10. FINANCE COSTS

Interest expense for financial liabilities not classified as fair value through profit or loss is as follows:


Interest on loan creditor carried at amortised costs 331,317 1,061,450 331,317 882,538Interest on bank overdraft 423,634 363,065 - -Bank charges 270 160 - -Other interest expense 455 3,637 - -

755,676 1,428,312 331,317 882,538

11. INCOME TAX EXPENSE

Income tax expense comprises:


Current year:Current tax expense 1,052,000 136,000 - -Deferred tax income relating to the origination and

reversal of temporary differences (104,000) - - -

948,000 136,000 - -Adjustment recognised in the current year in

relation to the current tax expense of prior years 223 4,587 - -

Total tax expenses 948,223 140,587 - -


59


11. INCOME TAX EXPENSE (cont'd)

The total income tax expense for the year can be reconciled to the accounting profit/ (loss) as follows:


Profit/ (loss) before tax 2,994,257 2,503,298 (1,103,301) 1,522,369

Tax expense/ (credit) calculated using statutory income tax rate of 25% (2011: 25%) 749,000 626,000 (276,000) 381,000

Effect of expenses that are not deductible in determining taxable profit 679,000 1,047,900 304,000 438,000

Effect of income that is not taxable in determining taxable profit (240,000) (1,535,000) - (829,000)

Effect of reversal of deferred tax assets not recognised previously (240,000) (64,900) (28,000) -

Effect of net deferred tax assets not recognised - 62,000 - 10,000

948,000 136,000 - - Adjustment recognised in the current year in

relation to the current tax expense of prior years 223 4,587 - -

Income tax expense recognised in profit or loss 948,223 140,587 - -

The estimated tax saving arising from utilisation of previously unused tax losses is RM148,000 (2011: RM11,000) that were used to reduce current tax expense of the Group.

As of December 31, 2012, the approximate amounts of unused tax capital allowances and unused tax losses of the Group and of the Company, which are available for set off against future taxable income are as follows:


Unused tax capital allowances 4,942,000 4,794,000 - 2,000Unused tax losses 2,400,000 2,992,000 - -


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Annual Report 2012

12. PROFIT/ (LOSS) FOR THE YEAR

Profit/ (loss) for the year has been arrived at:


After charging: Rental of:

Premises 113,045 115,954 - -Motor vehicles 5,680 1,770 - -

Audit feeCurrent year 108,020 95,600 39,000 36,000Underprovision in prior years 6,500 - 1,500 -

13. EARNINGS PER SHARE

Basic earnings per share is calculated by dividing profit for the year attributable to equity owners of the Company by the weighted average number of ordinary shares in issue during the financial year.

The Group2012 2011

Profit for the year attributable to equity holders of the Company (RM) 2,050,350 2,364,407Weighted average number of ordinary shares in issue (units) 52,728,000 52,728,000

Basic earnings per share (sen) 3.89 4.48

14. PROPERTY, PLANT AND EQUIPMENT

The Group

Cost unless stated otherwiseBeginning

of year Additions Revaluation Write-off/disposals

Endof year

RM RM RM RM RM

2012:Freehold land

- at 2011 valuation 4,400,000 - - - 4,400,000Factory buildings 756,221 - - - 756,221Plant and machinery 3,729,264 196,700 - (126,652) 3,799,312Motor vehicles 798,564 - - - 798,564Forklift and excavators 190,000 - - - 190,000Tools, moulds, trays and pallets 1,307,235 114,500 - (7,459) 1,414,276Office equipment, furniture and

fittings 297,831 47,898 - (10,510) 335,219Factory equipment 1,074,644 5,490 - (28,973) 1,051,161Apartments 50,589 - - - 50,589

12,604,348 364,588 - (173,594) 12,795,342


61


14. PROPERTY, PLANT AND EQUIPMENT (cont’d)

The Group (cont’d)

Cost unless stated otherwiseBeginning

of year Additions Revaluation Write-off/disposals

Endof year

RM RM RM RM RM

2011:Freehold land

- at 2006 valuation 3,860,100 - (3,860,100) - -- at 2011 valuation - - 4,400,000 - 4,400,000

Factory buildings 756,221 - - - 756,221Plant and machinery 3,664,464 64,800 - - 3,729,264Motor vehicles 798,564 - - - 798,564Forklift and excavators 190,000 - - - 190,000Tools, moulds, trays and pallets 1,250,735 56,500 - - 1,307,235Office equipment, furniture and

fittings 274,155 23,676 - - 297,831Factory equipment 1,064,655 9,989 - - 1,074,644Apartments 50,589 - - - 50,589

11,909,483 154,965 539,900 - 12,604,348

Accumulated depreciationBeginning

of yearCharge for

the yearWrite-off/disposals

Endof year

RM RM RM RM

2012:Factory buildings 703,449 22,377 - 725,826Plant and machinery 3,704,827 47,345 (126,652) 3,625,520Motor vehicles 763,091 24,267 - 787,358Forklift and excavators 155,688 10,290 - 165,978Tools, moulds, trays and pallets 1,256,115 21,140 (7,459) 1,269,796Office equipment, furniture and fittings 232,412 20,308 (5,378) 247,342Factory equipment 741,895 62,241 (28,973) 775,163Apartments 20,405 1,011 - 21,416

7,577,882 208,979 (168,462) 7,618,399

2011:Factory buildings 673,532 29,917 - 703,449Plant and machinery 3,664,464 40,363 - 3,704,827Motor vehicles 715,494 47,597 - 763,091Forklift and excavators 145,398 10,290 - 155,688Tools, moulds, trays and pallets 1,250,735 5,380 - 1,256,115Office equipment, furniture and fittings 219,871 12,541 - 232,412Factory equipment 680,499 61,396 - 741,895Apartments 19,394 1,011 - 20,405

7,369,387 208,495 - 7,577,882


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Annual Report 2012


The Company

CostBeginning

of year Additions DisposalsEnd

of yearRM RM RM RM

2012:Office equipment 158,276 - - 158,276

2011:Office equipment 158,276 - - 158,276

Accumulated depreciationBeginning

of yearCharge for

the year DisposalsEnd

of yearRM RM RM RM

2012:Office equipment 158,026 131 - 158,157

2011:Office equipment 157,502 524 - 158,026


Net book value:Freehold land

- at 2011 valuation 4,400,000 4,400,000 - -Factory buildings 30,395 52,772 - -Plant and machinery 173,792 24,437 - -Motor vehicles 11,206 35,473 - -Forklift and excavators 24,022 34,312 - -Tools, moulds, trays and pallets 144,480 51,120 - -Office equipment, furniture and fittings 87,877 65,419 119 250Factory equipment 275,998 332,749 - -Apartments 29,173 30,184 - -

5,176,943 5,026,466 119 250

The strata title for an apartment of a subsidiary company with a carrying value of RM29,173 (2011: RM30,184) has not been issued by the relevant authority.

The Group’s motor vehicles with a carrying value of RM 11,202 (2011: RM20,802) are registered in the name of certain third parties.

Had the freehold land been carried at historical cost, the carrying amount of the revalued freehold land of the Group would have been RM374,043 (2011: RM374,043).


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As of December 31, 2012, plant and machinery with net carrying amount of RM173,067 (2011: Nil) are acquired under hire-purchase arrangement of which instalments are still outstanding.

15. INVESTMENT IN SUBSIDIARY COMPANIES

The Company2012 2011RM RM

Unquoted shares, at cost 61,180,751 61,180,751Less: Accumulated impairment loss (7,169,978) (7,169,978)

Net 54,010,773 54,010,773

The subsidiary companies, all incorporated in Malaysia, are as follows:

Principal ActivityPercentage of

ownership 2012 2011

Multi-Usage Cement Products Sdn. Bhd. Manufacturing and trading of cement products, bricks, stones and all kinds of building materials

100% 100%

Multi-Usage Cement Products (Selangor) Sdn. Bhd.

Inactive 100% 100%

Multi-Usage Cement Products (Johore) Sdn. Bhd.

Trading of polished tiles 100% 100%

Multi-Usage Trading Sdn. Bhd. Trading of building materials and hardware 100% 100%

Multi-Mix Sdn. Bhd. Manufacturing and trading of ready-mixed concrete and building materials

100% 100%

Multi-Usage Engineering Sdn. Bhd. Contracting works and project management for construction projects

100% 100%

Multi-Usage Property Sdn. Bhd.* Provision of management services 100% 100%

Multi-Usage Heavy Equipment Sdn. Bhd.* Inactive 51% 51%

Seleksi Nostalgia Sdn. Bhd.* Investment holding 100% 100%

TF Land Sdn. Bhd.* Property development- Direct interest 49.5% 49.5%- Indirect interest 50.5% 50.5%


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Annual Report 2012

15. INVESTMENT IN SUBSIDIARY COMPANIES (cont'd)

In 2011, the financial statements of these subsidiary companies were audited by auditors other than the auditors of the Company.

16. OTHER FINANCIAL ASSET


Available-for sale investments carried at fair value:

Quoted shares 791 791 791 791

17. GOODWILL

At the end of the reporting period, the Group assessed the recoverable amount of goodwill, and determined that there was no impairment on goodwill need to be recognised.

Goodwill arising on the acquisition of a subsidiary company involved in property development represents the excess of the cost of acquisition over the Group’s interest in the net fair value of the identifiable assets and liabilities of the subsidiary recognised at the date of acquisition.

The recoverable amount of the cash generating unit is determined based on a value in use calculation which uses cash flow projections based on financial budgets approved by management covering a five-year period, and a discount rate of 8% per annum.

Cash flow projections during the budget period are based on the same expected gross margins and raw materials price inflation throughout the budget period. The directors believe that any reasonably possible change in the key assumptions on which recoverable amount is based would not cause the aggregate carrying amount to exceed the aggregate recoverable amount of the cash-generating unit.


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18. PROPERTY DEVELOPMENT COSTS

The Group2012 2011

Non-Current Assets

Current Assets

Non-Current Assets

CurrentAssets

RM RM RM RM

At beginning of year:Freehold land 5,716,960 5,841,293 10,150,421 1,407,832Development costs 12,074,316 19,731,157 24,120,581 3,903,147

17,791,276 25,572,450 34,271,002 5,310,979

Cost incurred during the year:Development costs 99,872 11,830,596 - 3,477,607

Costs recognised in profit or loss:At beginning of year - (2,539,727) - -Recognised during the year - (10,452,167) - (2,539,727)

At end of year - (12,991,894) - (2,539,727)

Transfer (to current assets)/ from non-current assets of property development costs:

Freehold land (1,452,485) 1,452,485 (4,433,461) 4,433,461Development costs (5,058,501) 5,058,501 (12,046,265) 12,046,265

(6,510,986) 6,510,986 (16,479,726) 16,479,726

At end of year 11,380,162 30,922,138 17,791,276 22,728,585

The property development costs at end of year are analysed as follows:

The Group2012 2011

Non-Current Assets

Current Assets

Non-Current Assets

CurrentAssets

RM RM RM RM

Freehold land - at cost 4,264,475 6,461,483 5,716,960 5,841,293Development costs 7,115,687 24,460,655 12,074,316 16,887,292

11,380,162 30,922,138 17,791,276 22,728,585


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Annual Report 2012

19. DEFERRED TAX ASSETS/ (LIABILITIES)

The Group

Opening balance

Recognised in profit or

loss

Recognisedin other

comprehensive income

Closing balance

RM RM RM RM

2012Deferred tax assets

Unused tax losses - 104,000 - 104,000

Deferred tax liabilitiesProperty, plant and equipment 8,000 - - 8,000

2011Deferred tax assets

Unused tax losses - - - -

Deferred tax liabilitiesProperty, plant and equipment 8,000 - - 8,000

As mentioned in Note 3, the tax effects of deductible temporary differences, unused tax capital allowances and unused tax losses which would give rise to deferred tax assets are generally recognised to the extent that it is probable that future taxable profits will be available against which the deductible temporary differences, unused tax capital allowances and unused tax losses can be utilised. As of December 31, 2012, deferred tax assets have not been recognised in respect of the following:


Unused tax capital allowances 4,942,000 4,794,000 - 2,000Unused tax losses 1,983,000 2,992,000 - -Temporary differences arising from:

Property, plant and equipment 133,000 121,000 - (1,000)Others 234,000 346,000 234,000 346,000

7,292,000 8,253,000 234,000 347,000


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20. INVENTORIES


Developed properties 3,183,174 5,851,124Finished goods 568,148 463,045Raw materials 154,545 91,171

3,905,867 6,405,340

The cost of inventories recognised as an expense by the Group during the financial year was RM19,888,790 (2011: RM12,065,256).

The titles to certain developed properties with a total carrying value of Nil (2011: RM297,776) have yet to be issued by the relevant authority.

21. TRADE AND OTHER RECEIVABLES


Trade receivables 3,214,306 2,980,448 - -Less: Allowance for doubtful debts (8,330) (15,952) - -

3,205,976 2,964,496 - -

Other receivables 5,801 99,138 - -Less: Allowance for doubtful debts - (19,877) - -

5,801 79,261 - -

Amount owing by subsidiary companies - - 196,937 36,3043,211,777 3,043,757 196,937 36,304

Trade receivables disclosed above are classified as loans and receivables and therefore measured at amortised cost.

Trade receivables comprise amounts receivable for the sales of goods, progress billings receivable and sale of developed properties.

The average credit period granted on sales of goods to trade receivables range from 30 to 90 days (2011: 30 to 90 days). The settlement term for purchasers of properties-in-progress is 21 working days (2011: 21 working days) whilst the settlement term for purchasers of completed units range from 21 - 120 days (2011: 21 to 120 days). No interest is charged on trade receivables outstanding balance. Allowance for impairment loss are recognised against trade receivables over credit period based on estimated irrecoverable amounts determined by reference to past default experience of the counterparty and an analysis of the counterparty’s current financial position.

Trade receivables disclosed above include amounts (see below for aged analysis) that are past due at the end of the reporting period but against which the Group has not recognised an allowance for impairment loss because there has not been a significant change in credit quality and the amounts are still considered recoverable. The Group does not hold any collateral or other credit enhancements over these balances nor does it have a legal right of offset against any amounts owed by the Group to the counterparty.


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Annual Report 2012

21. TRADE AND OTHER RECEIVABLES (cont'd)

Aging of past due but not impaired trade receivables:


1 to 30 days 47,250 -30 to 60 days 654,766 444,11560 to 90 days 128,779 24,76090 to 120 days 38,218 8,071More than 120 days 695,346 623,667Total 1,564,359 1,100,613

Movement in the allowance for impairment loss for trade and other receivables is as follows:


Balance at beginning of the year 35,829 211,082Amount written off during the year as uncollectible (35,829) (122,739)Allowance for impairment loss 8,330 -Amount recovered during the year - (52,514)Balance at end of the year 8,330 35,829

Aging of impaired trade and other receivables:


More than 120 days 8,330 35,829

Trade receivables that are neither past due nor impaired are creditworthy debtors with good payment records with the Group.

In determining the recoverability of a trade receivable, the Group considers any change in the credit quality of the trade receivable from the date credit was initially granted up to the end of the reporting date. The Group does not hold any collateral over these balances except for the sale of developed properties where the titles of the properties will only be transferred to the buyers upon full settlement.


69


21. TRADE AND OTHER RECEIVABLES (cont'd)

The amount owing by subsidiary companies are as follows:


TF Land Sdn. Bhd. 178,436 -Multi-Usage Cement Products (Johore) Sdn. Bhd. 10,351 1,914Seleksi Nostalgia Sdn. Bhd. 8,150 4,050Multi-Usage Property Sdn. Bhd. - 30,340

196,937 36,304

The amount owing by subsidiary companies arose mainly from unsecured advances which are interest free and repayable on demand.

22. SHORT-TERM DEPOSITS WITH LICENSED BANKS

As of December 31, 2012, the short-term deposits with licensed banks of the Group carry interest at a rate of 3.1% (2011: 3.1%) per annum. The short-term deposits with licensed banks are maturing in April 2013.

As of December 31, 2012, the short-term deposits with licensed banks of the Group with a total carrying value of RM218,526 (2011: RM215,745) are pledged to the local banks as securities for bank guarantee facilities granted to the Group.

23. CASH AND BANK BALANCES Included in cash and bank balances of the Group as of December 31, 2012 is an amount of RM1,961,626 (2011: RM1,097,252) which is held under Housing Development Accounts pursuant to Section 7A of the Housing Developers (Control and Licensing) Act, 1966.

24. SHARE CAPITAL


Authorised:100,000,000 ordinary shares of RM1 each 100,000,000 100,000,000

Issued and fully paid:52,728,000 ordinary shares of RM1 each 52,728,000 52,728,000


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Annual Report 2012

25. RESERVES


Non-distributable:Share premium 17,043,264 17,043,264 17,043,264 17,043,264Properties revaluation reserve 1,696,198 1,696,198 - -

18,739,462 18,739,462 17,043,264 17,043,264

The share premium of the Group and of the Company arose from allotments of ordinary shares at premium net of share issue expenses.

The movement in properties revaluation reserve is as follows:


Balance at beginning of year 1,696,198 1,156,298Increase arising on revaluation of properties - 539,900

Balance at end of year 1,696,198 1,696,198

The properties revaluation reserve is used to record increase and decrease in revaluation of non-current assets, as described in the accounting policies. The revaluation reserve represents surplus arising from revaluation of a subsidiary company’s freehold land made in 1994, 2006 and 2011 by a firm of professional valuers.

26. LOAN CREDITOR


Amount owing to a third party arising from debt settlement agreement 6,425,805 13,101,842 6,425,805 11,689,390

Repayment during the year - (3,628,213) - (2,831,849)Discount received for early settlement - (4,109,274) - (3,314,274)Interest on loan creditor carried at amortised cost 331,317 1,061,450 331,317 882,538

Total 6,757,122 6,425,805 6,757,122 6,425,805Less: Current portion at amortised cost (6,757,122) (3,520,478) (6,757,122) (3,520,478)

Non-current portion at amortised cost - 2,905,327 - 2,905,327


71


26. LOAN CREDITOR (cont'd)

In 2005, the Group and the Company had defaulted in interest and principal payments for certain bank borrowings including the bank overdraft as mentioned in Note 30. The directors of the Company had approached and initiated negotiations with the banks on a proposed debts settlement plan. As of December 31, 2012, the proposed debts settlement plan were finalised with seven out of the eight lenders.

Pursuant to the debt settlement agreement made in 2008 between the Company and its subsidiary companies, four banks and a third party, the banks had agreed to assign the outstanding debts to the third party upon settlement of the settlement sum by the third party on behalf of the Company and its subsidiary companies to the banks. The agreed settlement sum was RM4,909,016, which was based on a certain percentage of the total outstanding debts due to the banks as of December 31, 2006 of RM17,134,661. In consideration of the third party assisting the Company and its subsidiary companies to settle the settlement sum to the banks, the Company and its subsidiaries had agreed to the assignment of the amount of RM17,134,661 by the banks to the third party based on the terms mentioned below. The outstanding debts owing to another lender was settled by the Group through internally generated funds. The agreed settlement sum was RM694,606 which was based on a certain percentage of the total outstanding debts due to the bank as of December 31, 2006 of RM973,475 with a waiver of an amount of RM278,869.

In 2009, one of the subsidiary company had also finalised its proposed debts settlement plan with a lender. The agreed settlement sum was RM1,000,000 which was based on a certain percentage of the total outstanding debts as of December 31, 2006 of RM3,233,093, was also settled by the abovementioned third party on behalf of the subsidiary company. The outstanding debts of RM3,233,093 was also assigned to the third party based on similar repayment terms mentioned below.

In 2009, the Company and certain of its subsidiary companies had also entered into a settlement plan with one of the remaining two lenders and this was finalised on June 30, 2010. The agreed settlement sum was RM4,100,000, which was based on a certain percentage of the total outstanding debts including the bank overdraft as of December 31, 2006 of RM15,762,604, was also settled by the abovementioned third party on behalf of the Company and its subsidiary companies. The outstanding debts of RM15,762,604 was also assigned to the third party based on similar repayment terms mentioned below. The Group and the Company were entitled to waiver of interest charged and accrued on the outstanding debts since December 31, 2006 totalling RM5,346,329 and RM1,930,898 respectively upon full and final settlement of the settlement sum on June 30, 2010.

Pursuant to an agreement made with the third party as mentioned above, the amount due to the third party shall be free of any interest and shall be repaid by the Group and the Company to the third party within 36 months from September 12, 2008 for the debts assumed of RM17,134,661, from April 28, 2009 for the debts assumed of RM3,233,093 and from June 30, 2010 for the debts assumed of RM15,762,604 or in such other extended period as shall be approved by the third party in writing.

For purposes of early settlement by the Group and by the Company, further cash discounts for early settlement shall be allowed in the following manner:

a) Any repayment made within one year from September 12, 2008, April 28, 2009 and June 30, 2010, a further RM1.50 shall be deducted (over and above the said payment) against the remaining outstanding debts for every RM1.00 payment made.

b) Any repayment made after one year but within two years from September 12, 2008, April 28, 2009 and June 30, 2010, a further RM1.00 shall be deducted (over and above the said payment) against the remaining outstanding debts for every RM1.00 payment made.

c) Any repayment made after two years but within three years from September 12, 2008, April 28, 2009 and June 30, 2010, a further RM0.6667 shall be deducted (over and above the said payment) against the remaining outstanding debts for every RM1.00 payment made.

The amount due to the loan creditor is guaranteed by a subsidiary company, TF Land Sdn. Bhd..


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Annual Report 2012

27. HIRE PURCHASE PAYABLE

The hire-purchase payable is as follows:


Amount outstanding 164,511 -Less: Interest-in-suspense outstanding (26,845) -

Principal outstanding 137,666 -Less: Current portion (28,008) -

Non-current portion 109,658 -

The non-current portion of hire-purchase payable is repayable as follows:


Later than one year and not later than two years 28,008 -Later than two years and not later than five years 81,650 -

109,658 -

The effective interest rate of the Group as of 31 December 2012 is 3.9% (2011: Nil) per annum. The terms forhire-purchases of the Group are five years.

28. TRADE AND OTHER PAYABLES


Trade payables 1,779,540 3,768,588 - -Amount owing to subsidiary companies - - 7,975,671 7,688,108Amount owing to directors 376,650 443,057 152,276 259,272Other payables 1,209,713 1,311,863 122,152 30,440Accrued expenses 303,423 1,616,085 121,000 123,000

3,669,326 7,139,593 8,371,099 8,100,820

Trade payables of the Group comprise amounts outstanding for trade purchases. The credit periods granted to the Group for trade purchases range from 30 to 120 days (2011: 30 to 120 days). No interest is charged on trade payables outstanding balance. The Group has financial risk management policy in place to ensure that all payables are paid within the pre-agreed credit terms. Included in trade payables of the Group as of December 31, 2012, is an amount of RM619,870 (2011: RM117,421) representing retention sum payable on contracts.


73


28. TRADE AND OTHER PAYABLES (cont'd)

The amount owing to subsidiary companies are as follows:


Multi-Usage Cement Products Sdn. Bhd. 3,625,734 2,259,740Multi-Usage Cement Products (Selangor) Sdn. Bhd. 1,626,747 1,630,447Multi-Usage Engineering Sdn. Bhd. 1,040,588 314,008Multi-Mix Sdn. Bhd. 869,939 854,913Multi-Usage Trading Sdn. Bhd. 576,019 425,800Multi-Usage Property Sdn. Bhd. 152,144 -Multi-Usage Heavy Equipment Sdn. Bhd. 84,500 84,500TF Land Sdn. Bhd. - 2,118,700

7,975,671 7,688,108

The amount owing to subsidiary companies arose mainly from unsecured advances which are interest free and repayable on demand.

The amount owing to directors arose mainly from unsecured advances which are interest free and repayable on demand.

Other payables of the Group and of the Company comprise mainly amounts outstanding for ongoing costs.

29. PROVISION FOR CORPORATE GUARANTEE

The Group and The Company2012 2011RM RM

At beginning of year 7,035,908 6,394,311Add: Provision made during the year 705,973 641,597

At end of year 7,741,881 7,035,908

Provision for corporate guarantee represents liability expected to crystallise from corporate guarantee executed by the Company in favour of a licensed bank in respect of credit facility granted to a former subsidiary company, Perlis Concrete Products Sdn. Bhd..

As of December 31, 2012, negotiation on the proposed debts settlement plan with the lender by the Company and one of the subsidiary company, which relate to the Group’s financial liabilities on the provision for corporate guarantee and bank overdraft as mentioned in Note 30 was still ongoing as of that date.


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Annual Report 2012

29. PROVISION FOR CORPORATE GUARANTEE (cont'd)

Subsequent to year end, the Company and its subsidiary company, Multi-Usage Cement Products Sdn. Bhd. had entered into the debt settlement arrangement with the lender for the settlement of the total outstanding amount due to the lender of RM12,689,300 as of February 28, 2013. Under the said settlement agreement, the claim sum of RM12,689,300 is to be settled in the following manner:

a) An upfront payment of RM2,500,000 to be paid to the lender latest by March 31, 2013; andb) The remaining balance of RM1,500,000 to be payable by 13 monthly installments of RM50,000 each and the

payment of the last settlement of the balance RM850,000 is subject to further negotiation after the 13th monthly installment.

The upfront payment of RM2,500,000 and first monthly instalment of RM50,000 had been paid by the Group on March 30, 2013.

30. BANK OVERDRAFT


Unsecured:Bank overdraft 4,683,002 4,259,368

The Group’s unsecured bank overdraft is covered by a corporate guarantee from the Company and by a negative pledge over all present and future assets of one of a subsidiary company.

The bank overdraft bears interest at a rate of 3.0% (2011: 3.0%) per annum above the lending banks’ base lending rates.

The annual effective interest rate of the bank overdraft is 9.6% (2011: 9.6%).

Subsequent to year end, the Company and its subsidiary company, Multi-Usage Cement Products Sdn. Bhd. had entered into the debt settlement arrangement with the lender as mentioned in Note 29.

31. CASH AND CASH EQUIVALENTS

Cash and cash equivalents included in the cash flow statements consist of the following balance sheet items:


Short-term deposits with licensed banks 218,526 215,745 - -Cash and bank balances 2,447,484 1,146,201 50,462 5,978

2,666,010 1,361,946 50,462 5,978Less: Short-term deposits held as security

value (Note 22) (218,526) (215,745) - -

2,447,484 1,146,201 50,462 5,978


75


31. CASH AND CASH EQUIVALENTS (cont'd)

During the financial year, the Group acquired property, plant and equipment with an aggregate cost of RM364,588 (2011: RM154,965) of which RM140,000 (2011: Nil) was financed by means of hire-purchase arrangement, and the balance of RM224,588 (2011: RM154,965) was cash payment.

32. CONTINGENT LIABILITIES - Unsecured (a) As of December 31, 2012, the Company is contingently liable to the extent of RM5,500,000 (2011: RM5,500,000)

in respect of a corporate guarantee given to a local licensed bank for credit facility granted to a subsidiary company.

(b) On March 4, 2013, the Company had been served with a writ of summons and statement of claim by Covenant Equity Consulting Sdn. Bhd. (“CEC”), claiming for an amount of RM2,986,045 together with interest at the rate of 8% per annum from the date of summon until the date of full settlement.

In 2004, CEC was appointed by the Company as a financial adviser in relation to a Proposed Corporate and Debt Restructuring Scheme (“Proposals”). Following to that, the Proposals were announced and submitted to authorities for their approval in 2005. However, the Proposals had been rejected by the Securities Commission in 2006.

The directors of the Company wishes to highlight that the Company had fully settled the invoices pertaining to the advisory work that CEC involved for the Proposals as agreed by both parties.

The Company is denying the claim and seeking legal advice as to the appropriate course of action in respect of the above.

As the outcome of the legal suit is not presently known, the financial impact cannot be estimated or ascertained with reasonable certainty. Therefore, the Group is unable to quantify the financial and operational impact or expected losses, should there be any.

33. FINANCIAL INSTRUMENTS

a. Capital risk management

The Group’s objectives when managing capital are to safeguard the Group’s ability to continue as a going concern and to maintain an optimal capital structure so as to maximise shareholders’ value. Management monitors capital based on ability of the Group to generate sustainable profits. The Group’s overall strategy remains unchanged from 2011.

Under the requirement of Bursa Malaysia Practice Note No. 17/2005, the Company is required to maintain a consolidated shareholders’ equity equal to or not less than the 50 percent of the issued and paid-up capital (excluding treasury shares) when auditors have expressed a modified opinion with emphasis on going concern in the latest audited financial statements. The Company has complied with this requirement.

b. Financial risk management objectives and policies

The operations of the Group are subject to a variety of financial risks, including credit risk, interest rate risk, liquidity risk and cash flow risk. The Group has formulated a financial risk management framework whose principal objective is to minimise the Group’s exposure to risks and/ or costs associated with the financing, investing and operating activities of the Group.

Various risk management policies are made and approved by the Board for observation in the day-to-day operations for the controlling and management of the risks associated with financial instruments.

The Group does not enter into or trade financial instruments, including derivative financial instruments, for speculative purposes.


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Annual Report 2012

33. FINANCIAL INSTRUMENTS (cont'd)

b. Financial risk management objectives and policies (cont'd)

i. Credit risk management

Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in financial loss to the Group. The Group has adopted a policy of only dealing with creditworthy counterparties, as a means of mitigating the risk of financial loss from defaults. The Group uses its own trading records to rate its major customers. The Group’s exposure and the credit ratings of its counterparties are continuously monitored and the aggregate value of transactions concluded is spread amongst approved counterparties.

Trade receivables consist of a large number of customers and spread across diverse industries. Ongoing credit evaluation is performed on the financial condition of accounts receivable.

The trade receivables that are neither past due nor impaired relate to customers that the Group has assessed to be creditworthy, based on the credit evaluation process performed by management. Cash is held with creditworthy institutions.

At the reporting date, the Group does not have significant credit risk exposure to any single counterparty or of any group of counterparties having similar characteristics. The Group defines counterparties as having similar characteristics if they are related entities. Concentration of credit risk to any other counterparty did not exceed 5% of gross trade receivables of the Group at the end of reporting date.

The carrying amount of financial assets recognised in the financial statements, which is net of impairment losses, represents the Group’s maximum exposure to credit risk.

Further details of credit risks on trade and other receivables are disclosed in Note 21.

ii. Interest rate risk management

The Group’s exposure to changes in interest rates relates primarily to the Group short-term deposits with licensed banks and the financing through bank borrowings. It has no significant interest-bearing financial assets or liabilities other than short-term deposits with licensed banks and bank borrowings. The Group does not use derivative financial instruments to hedge its risk.

No sensitivity analysis is prepared as the Group does not expect any material effect on the Group’s profit or loss arising from the effects of reasonably possible changes to interest rates on interest bearing financial instruments at the end of reporting period.

iii. Liquidity risk management

Ultimate responsibility for liquidity risk management rests with the board of directors, which has established an appropriate liquidity risk management framework for the management of the Group’s and the Company’s funding and liquidity management requirements.

The Group had defaulted in interest and principal payments for certain bank borrowings. However, as mentioned in Notes 26 and 29, the directors of the Company had approached and initiated negotiations with banks on a proposed debts settlement plan. As of December 31, 2012, the proposed debts settlement plan were finalised with seven out of the eight lenders. Negotiation on the proposed debts settlement plan with the remaining lender by the Company and one of the subsidiary company, which relate to the Group’s financial liabilities on the provision for corporate guarantee and bank overdraft amounts as of December 31, 2012 of RM7,741,882 and RM4,683,002 respectively, was still ongoing as of that date. Subsequent to year end, the proposed debts settlement plan was finalised by the Group with the remaining lender as mentioned in Note 29.


77



b. Financial risk management objectives and policies (cont'd)

iii. Liquidity risk management (cont'd)

The following table details the Group’s and the Company’s liquidity analysis for its interest-free non derivative financial liabilities with the expected repayment periods. The tables have been drawn up based on undiscounted cash flows of financial liabilities based on the earliest date on which the Group and the Company can be required to pay.

Less than 1 year

1 to 2 years

2 to 3years Total

RM RM RM RM

The Group

2012:Non-interest bearing loan creditor 7,057,365 - - 7,057,365

2011:Non-interest bearing loan creditor 4,050,000 3,007,365 - 7,057,365

The Company

2012:Non-interest bearing loan creditor 7,057,365 - - 7,057,365

2011:Non-interest bearing loan creditor 4,050,000 3,007,365 - 7,057,365

The Group and the Company do not hold any derivative financial instruments.

iv. Cash flow risk management

The Group reviews its cash flow position regularly to manage its exposures to fluctuations in future cash flows associated with its monetary financial instruments.

c. Fair value of financial assets and financial liabilities

Except as detailed in following paragraph, the directors consider that the carrying amounts of financial assets and financial liabilities of the Group and of the Company recognised in the financial statements approximate their fair values.


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Annual Report 2012


c. Fair value of financial assets and financial liabilities (cont'd)

The fair value of the loan creditor of the Group and of the Company is estimated using discounted cash flows analysis based on prevailing bank borrowing rates ranging from 8.05% to 8.8% (2011: 8.05% to 8.8%) per annum and on the assumption that the Group and the Company will repay the outstanding debts as scheduled as follows:


Year:2012 - 4,050,0002013 7,057,365 3,007,365

7,057,365 7,057,365


Year:2012 - 4,050,0002013 7,057,365 3,007,365

7,057,365 7,057,365

34. SEGMENTAL INFORMATION

Products and services from which reportable segments derive their revenue

Information reported to the chief operating decision maker for the purposes of resource allocation and assessment of segment performance focuses on types of goods or services delivered or provided. The Group’s reportable segments under FRS 8 Operating segments are therefore as follows:

a. property developmentb. contracting works for construction projectc. manufacturing of cement products, bricks, hollow blocks, stones and all kinds of building materialsd. trading of furniture, cement products, bricks, hollow blocks, stones and all kinds of building materialse. others (investment holding and provision of management services and hiring of mobile and other heavy

equipment)


79


34. SEGMENTAL INFORMATION (cont'd)

Segment revenue and results

The following is an analysis of the Group’s revenue and results by reportable segments:

The Group

Property development Contracting Manufacturing Trading Others Eliminations Consolidated

RM RM RM RM RM RM RM

2012:

RevenueExternal revenue 18,603,120 10,000 5,757,278 3,882,191 - - 28,252,589Inter-segment

revenue - 11,411,161 2,663,650 281,542 404,753 (14,761,106) -Total revenue 18,603,120 11,421,161 8,420,928 4,163,733 404,753 (14,761,106) 28,252,589

ResultsSegment profit/ (loss) 2,723,681 1,437,017 (103,810) 407,046 (80,218) - 4,383,716Investment revenue 93,917Other gains and

losses (21,727)Provision for

corporate guarantee (705,973)Finance costs (755,676)Profit before tax 2,994,257Income tax expense (948,223)

Profit for the year 2,046,034

2011:

RevenueExternal revenue 8,416,767 - 5,260,894 1,485,278 - - 15,162,939Inter-segment

revenue - 2,133,130 969,506 516,679 217,229 (3,836,544) -Total revenue 8,416,767 2,133,130 6,230,400 2,001,957 217,229 (3,836,544) 15,162,939

ResultsSegment profit/ (loss) 538,282 83,851 (258,836) 135,563 (172,229) - 326,631Investment revenue 74,700Other gains and

losses 4,171,876Provision for

corporate guarantee (641,597)Finance costs (1,428,312)Profit before tax 2,503,298Income tax expense (140,587)

Profit for the year 2,362,711


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Annual Report 2012


Segment revenue and results (cont‘d)

The Group (cont‘d)

The accounting policies of the reportable segments are the same as the Group’s accounting policies described in Note 3. Segment profit/ loss represents the profit earned/ loss suffered by each segment without investment revenue, other gains and losses, provision for corporate guarantee, finance costs and income tax expense. This is the measure reported to the chief operating decision maker for the purpose of resource allocation and assessment of segment performance.

Segment assets and liabilities

The Group



2012:

AssetsSegment assets 48,987,310 370,638 6,949,913 907,330 7,453,479 - 64,668,670Unallocated corporate

assets 219,317Consolidated total

assets 64,887,987

LiabilitiesSegment liabilities 804,718 648,680 909,798 438,618 867,512 - 3,669,326Unallocated corporate

liabilities 19,696,626Consolidated total

liabilities 23,365,952

2011:

AssetsSegment assets 49,292,524 34,769 6,661,420 715,299 7,409,293 - 64,113,305Unallocated corporate

assets 246,370Consolidated total

assets 64,359,675

LiabilitiesSegment liabilities 4,167,095 413,638 1,348,935 325,870 884,055 - 7,139,593Unallocated corporate

liabilities 17,744,081Consolidated total

liabilities 24,883,674


81



Segment assets and liabilities (cont'd)

The Group (cont'd)

For the purposes of monitoring segment performance and allocating resources between segments:

a. all assets allocated to reportable segments other than current tax assets, other financial asset and short-term deposits with licensed bank. Goodwill is allocated to reportable segments.

b. all liabilities are allocated to reportable segments other than loan creditor, provision for corporate guarantee, bank overdraft, other bank borrowings and current and deferred tax liabilities.

Other segment information

The Group



2012:

Other informationAdditions to non-

current assets 37,941 4,300 180,239 2,108 - - 224,588Depreciation and

amortisation expense 18,685 10,485 178,561 1,117 131 - 208,979

Non-cash expenses other than depreciation, amortisation 3,000 - 10,397 8,330 705,973 - 727,700

2011:

Other informationAdditions to non-

current assets 23,059 7,699 124,207 - - - 154,965Depreciation and

amortisation expense 11,393 32,333 163,234 1,011 524 - 208,495

Non-cash expenses other than depreciation, amortisation 20,595 - - 3,057 641,597 - 665,249

Revenue from major products and services

Analysis of revenue from major products and services was not disclosed due to it is not practical to analyse these information without incurring excessive cost.

Geographical information

Information on geographical segments are not presented as the Group operates predominantly in Malaysia.

Information about major customers

Information about major customers was not disclosed as there was no customer that contributed 10% or more to the Group revenue for both 2012 and 2011.


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Annual Report 2012

35. SUPPLEMENTARY INFORMATION - DISCLOSURE ON REALISED AND UNREALISED PROFITS/LOSSES

On March 25, 2010, Bursa Malaysia Securities Berhad issued a directive to all listed issuers pursuant to Paragraphs 2.06 and 2.23 of the Bursa Securities Main Market Listing Requirements. The directive requires all listed issuers to disclose the breakdown of the unappropriated profits or accumulated losses as of the end of the reporting period into realised and unrealised profits or losses.

On December 20, 2010, Bursa Malaysia Securities Berhad further issued guidance on the disclosure and the prescribed format required.

The breakdown of the retained earnings of the Group and of the Company as of December 31, 2012 into realised and unrealised amounts, pursuant to the directive, is as follows:


Total accumulated losses of the Company and its companiesRealised (5,724,574) (8,711,898) (30,938,390) (30,872,379)Unrealised (7,345,638) (6,412,348) (7,441,638) (6,404,348)

(13,070,212) (15,124,246) (38,380,028) (37,276,727)Less: Consolidation adjustments (16,961,061) (16,957,377) - -

Total accumulated losses as per statements of financial position (30,031,273) (32,081,623) (38,380,028) (37,276,727)

The determination of realised and unrealised profits or losses is based on Guidance of Special Matter No. 1 “Determination of Realised and Unrealised Profits or Losses in the Context of Disclosure Pursuant to Bursa Securities Listing Requirements” as issued by the Malaysian Institute of Accountants on December 20, 2010. A charge or a credit to the profit or loss of a legal entity is deemed realised when it is resulted from the consumption of resource of all types and form, regardless of whether it is consumed in the ordinary course of business or otherwise. A resource may be consumed through sale or use. Where a credit or a charge to the profit or loss upon initial recognition or subsequent measurement of an asset or a liability is not attributed to consumption of resource, such credit or charge should not be deemed as realised until the consumption of resource could be demonstrated.

The supplementary information have been made solely for complying with the disclosure requirements stipulated in the directive of Bursa Malaysia Securities Berhad and is not made for any other purposes.

SUPPLEMENTARY INFORMATION- DISCLOSURE ON REALISED AND UNREALISED PROFITS/LOSSES

83


The directors of MULTI-USAGE HOLDINGS BERHAD state that, in their opinion, the accompanying financial statements are drawn up in accordance with Financial Reporting Standards and the provisions of 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 of December 31, 2012 and of the financial performance and the cash flows of the Group and of the Company for the year ended on that date.

The supplementary information set out in Note 35, which is not part of the financial statements, is prepared in all material respects, in accordance with 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 and the directive of Bursa Malaysia Securities Berhad.

Signed in accordance with a resolution of the Directors,

ANG KIM CHENG @ ANG TENG KOK TAN CHEW HUA

Penang,

April 24, 2013

Statement by Directors

Declaration by the DirectorPrimarily Responsible for the Financial Management of the Company

I, TAN CHEW HUA, the director primarily responsible for the financial management of MULTI-USAGE HOLDINGS BERHAD, do solemnly and sincerely declare that the accompanying financial statements are, in my opinion, 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.

Subscribed and solemnly declared by theabovenamed TAN CHEW HUA atGEORGETOWN in the State of PENANGon April 24, 2013

Before me,

Commissioner For OathsDATO' DR. SELVARAJOO A/L ERULANDYPESURUHJAYA SUMPAHPENANG, MALAYSIA

84

Annual Report 2012

Location Description

Tenure/Age of Building (Year)

ApproximateLand /

Floor Area

Net BookValue

(RM’000)

Date of Acquisition / Re-valuation

Lot Nos. 1678,1817 & 2020, Mukim 16,Daerah Seberang Perai Tengah.

Land with factory & office building

Freehold /21 11.9 acres 4,430 16/12/2011

Lot Nos. 707, 1209, 1210,1211, 1212 & 1120, Mukim 15,Province Wellesley Central Comprised in Grant No. 42816and Mukim Grant Nos.GM 17,18,19, 20 & 451 respectively.

Ongoing mixed development

scheme known as Bandar

Machang Bubok

Freehold / NA 50.12 acres 10,726 15/06/1994

No.14 Tkt. 1,Clemont Court, Taman Seri Aman, Cheras, 43200 Selangor.

1 unit apartment

Freehold / 20 700 sq ft 29 20/09/1992

Lists of Propertiesas at December 31, 2012

85


Share Capital

Authorised Share Capital : RM100,000,000Issued and Fully Paid-Up Capital : RM52,728,000Class of Share : Ordinary Shares of RM1.00 each fully paidVoting Rights : On a show of hands - one vote for every shareholder On a poll - one vote for every ordinary share held

Distribution of Shareholdings

Size of holdings No. of Holders % of Holders No. of Shares %

1 - 99 96 3.17 2,168 0.00100 - 1000 739 24.43 692,652 1.311,001 - 10,000 1,827 60.40 7,170,964 13.6010,001 -100,000 308 10.18 8,920,173 16.92100,001 - 2,636,399 (*) 54 1.79 20,613,487 39.092,636,400 and above (**) 1 0.03 15,328,556 29.07

Total 3,025 100.00 52,728,000 100.00

Remarks : * Less than 5% of issued shares ** 5% and above of issued shares

Thirty Largest Shareholders

No. Name No. of Shares %

1 TOPAZVEST TEMASEK SDN. BHD. 7,703,000 14.6092 TOPAZVEST TEMASEK SDN. BHD. 7,625,556 14.4623 OOI AI LUAN 1,624,544 3.0814 NG CHOON SENG 1,074,100 2.0375 GOH CHONG EE 1,043,362 1.9796 TAN SEIK LANG 928,200 1.7607 HLIB NOMINEES (TEMPATAN) SDN BHD 918,400 1.742

HONG LEONG BANK BHD FOR SIM PUEI CHUN8 CHEONG CHIEW YOON 680,000 1.2909 TAN SWEE LEONG 678,000 1.286

10 HLIB NOMINEES (TEMPATAN) SDN BHD 635,000 1.204HONG LEONG BANK BHD FOR SIM YU HWA

11 CHAI MOOI CHONG 612,000 1.16112 PUBLIC NOMINEES (TEMPATAN) SDN BHD 603,700 1.145

PLEDGED SECURITIES ACCOUNT FOR SIM PUEI CHUN (E-BBB/SNG)13 TAN SEIK LANG 603,000 1.14414 ANGSON SDN BERHAD 602,000 1.14215 LEE KIAN CHYE 540,335 1.02516 HLIB NOMINEES (TEMPATAN) SDN BHD 522,500 0.991

HONG LEONG BANK BHD FOR YEE CHING SANG17 MAYBANK NOMINEES (TEMPATAN) SDN BHD 491,000 0.931

SIM PUEI CHUN18 SIM KHYE SHEN 480,000 0.91019 AMEER BIN NOORDIN 439,146 0.83320 WONG WUN PEN @ WONG VOON PHEW 433,900 0.823

Statistics of Shareholdingsas at May 13, 2013

86

Annual Report 2012

Thirty Largest Shareholders (cont'd)

No. Name No. of Shares %

21 CHAN KOK WAH 421,200 0.79922 TAN BEE CHENG 370,000 0.70223 LAI HEE DIN 282,000 0.53524 SIM KHYE SHEN 280,000 0.53125 HLIB NOMINEES (TEMPATAN) SDN BHD 277,200 0.526

HONG LEONG BANK BHD FOR CHUAH CHEE WANN26 MAYBANK NOMINEES (TEMPATAN) SDN BHD 250,300 0.475

LEE CHEE MING27 HDM NOMINEES (TEMPATAN) SDN BHD 244,100 0.463

PLEDGED SECURITIES ACCOUNT FOR ONG KHUNG CHIN (M01)28 OOI CHONG GHEE 240,000 0.45529 SAW HAI EARN 220,000 0.41730 TAN SEIK LANG 218,600 0.415

EXEMPT AN FOR CIMB SECURITIES (SINGAPORE) PTE LTD (RETAIL CLIENTS)TOTAL: 31,041,143 58.873

Substantial Shareholders holding 5% or more in the share capital

Direct Interest Indirect InterestName No. of Shares % No. of Shares %

Ang Kim Cheng @ Ang Teng Kok - - 16,616,104 (a) 31.51Tan Chew Hua - - 15,334,104 (b) 29.08Topazvest Temasek Sdn Bhd 15,328,556 29.07 - -

(a) Deemed interested by virtue of holding more than 15% in the shares of Angson Sdn. Bhd. and the interest of his spouse and shares held by family members via Topazvest Temasek Sdn. Bhd.

(b) Deemed interested by virtue of shares held by family members via Topazvest Temasek Sdn. Bhd.

Directors' Interests in the ordinary shares of the Company and related Companies

Direct Interest Indirect InterestName No. of Shares % No. of Shares %

The Company

Ang Kim Cheng @ Ang Teng Kok - - 16,616,104 (a) 31.51Tan Chew Hua - - 15,334,104 (b) 29.08Abd Aziz bin Mat - - - -Cheah Chin Huat - - - -Teh Eng Aun - - - - (a) Deemed interested by virtue of holding more than 15% in the shares of Angson Sdn. Bhd. and the interest of his

spouse and shares held by family members via Topazvest Temasek Sdn. Bhd.(b) Deemed interested by virtue of shares held by family members via Topazvest Temasek Sdn. Bhd.

By virtue of their interests in the shares of the Company, Mr Ang Kim Cheng @ Ang Teng Kok and Mr Tan Chew Hua are also deemed to have an interest in the shares of the subsidiary companies to the extent the Company has an interest.

Statistics of Shareholdings (cont'd)as at May 13, 2013

87

I/We,….......................................................................................……………………..............................………...….................(Full name in block letters)

NRIC/Company No………………………………………...............................…………………………..……………….…………..

of…......................……...............................…....……………………………………………………………………………..............(Address)

being a member/members of Multi-Usage Holdings Berhad (228933-D) (“the Company”) hereby appoint

…………………………................................................…………………….…………................................................................(Full name in block letters)

of…......................……...............................…....……………………………………………………………………………..............(Address)

or failing him/her …………...............................……………………………………………………………………………………….(Full name in block letters)

of ……………………………………………………..............................………………………………………………………………(Address)

as my/our proxy, to vote for me/us and on my/our behalf at the 21st ANNUAL GENERAL MEETING of the Company to be held at Sri Nilam, Level 2, Bayview Hotel Georgetown Penang, 25A, Farquhar Street, 10200 Penang on Tuesday, 25 June 2013 at 10.00 a.m., and at any adjournment thereof.

RESOLUTIONS FOR AGAINSTOrdinary Resolution 1Ordinary Resolution 2Ordinary Resolution 3Ordinary Resolution 4Ordinary Resolution 5

(Please indicate with an “X” in the spaces provided above as to how you wish your votes to be cast. If no specific direction as to voting is given, the proxy will vote or abstain from voting at his discretion).

In the case of more than one proxy is appointed, the proportions of my/our shareholding to be represented by my/our proxies are as follows:

First named Proxy %Second named Proxy %

100 %

Signed this.......................day of June, 2013.

......................................................................Signature of Shareholder

Notes : 1. A proxy may but need not be a member of the Company and a member may appoint any person to be his proxy without limitation

and the provisions of Section 149(1)(b) of the Companies Act, 1965 shall not apply to the Company. Where a member appoints two (2) or more proxies, he shall specify the proportion of his shareholdings to be represented by each proxy.

2. Where a member of the Company is an authorised nominee as defined under the Central Depositories Act, 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.

3. Where a member of the Company is an exempt authorised nominee which hold ordinary shares in the Company for multiple beneficial owners in one (1) securities account (“omnibus account”), there is no limit to the number of proxies which the exempt authorised nominee may appoint in respect of each omnibus account it holds.

4. The instrument appointing a proxy shall be in writing under the hand of the appointer or his attorney duly authorised in writing or, if such appointer is a corporation, the proxy form must be executed under its Common Seal or the hand of its attorney.

5. For the proxy to be valid, the proxy form duly completed must be deposited at the Company's Registered Office at Suite 2-1, 2nd Floor, Menara Penang Garden, 42A Jalan Sultan Ahmad Shah, 10050 Penang, not less than 48 hours before the time appointed for holding the meeting or adjourned meeting.

6. For the purpose of determining who shall be entitled to attend this meeting, the Company shall be requesting Bursa Malaysia Depository Sdn Bhd to make available to the Company pursuant to Article 51(2) of the Articles of Association of the Company and Paragraph 7.16(2) of the Main Market Listing Requirements of Bursa Malaysia Securities Berhad, a Record of Depositors (“ROD”) as at 18 June 2013 and only a Depositor whose name appears on such ROD shall be entitled to attend this meeting or appoint proxy to attend and/or vote on his/her behalf.

Proxy FormMulti-Usage Holdings Berhad 228933-D

CDS Account No. No. of Shares Held

Stamp

Please fold across the line and close



To : The Company Secretaries

MULTI-USAGE HOLDINGS BERHAD (228933-D) SUITE 2-1, 2ND FLOOR, MENARA PENANG GARDEN, 42A, JALAN SULTAN AHMAD SHAH, 10050 PENANG, MALAYSIA.

MULTI-USAGE HOLDINGS BERHAD (228933-D)

Level 15, Unit H, Wisma Boon Siew, No. 1 Penang Road, 10000 PenangTel: 04-2622858 Fax: 04-2621566

Documents

ANNUAL REPORT 2012 Annual Report 2012 BOARD OF DIRECTORS En. Abd. Aziz Bin Mat Independent Non-Executive Chairman Mr. Ang Kim Cheng @ Ang Teng Kok Group Managing Director Mr. Tan Chew