cybert-annualreport2012 (1.6mb)

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CYBERTOWERS BERHAD (385635-V)

Annual Report 2012

Contents

Corporate Information 2-3

Chairman’s Statement 4

Profile Of Directors 5-7

Corporate Governance Statement 8-12

Audit Committee Report 13-15

Statement On Internal Control 16

Directors’ Report 17-20

Statement By Directors 21

Statutory Declaration 21

Report Of The Independent Auditors 22-23

Statements Of Financial Position 24-25

Statements Of Comprehensive Income 26

Statements of Changes in Equity 27

Statements Of Cash Flows 28-29

Notes To The Financial Statements 30-64

Analysis Of Shareholdings 65-67

Notice Of Annual General Meeting 68-69

Statement Accompanying Notice of Annual General Meeting 70

Proxy Form 71

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Annual Report 2012

Corporate Information

BOARD OF DIRECTORS

Lai Ka Wai (Executive Director)

Yuen Chun Fai (Executive Director) (Appointed on 25.4.2012)

Lee Chee Cheng (Independent Non-Executive Director)

Lee Choong Kin (Independent Non-Executive Director) (Appointed on 3.4.2012)

Chua Hwa Nian (Independent Non-Executive Director) (Appointed on 20.4.2012)

Wong Chook Ping (Non-Executive Chairman) (Resigned on 3.4.2012)

Por Yew Guan (Independent Non-Executive Director) (Resigned on 20.4.2012)

Wong Kek Wei (Managing Director) (Resigned on 22.6.2012)

AUDIT COMMITTEE

Chairman: Lee Chee Cheng

Member: Lee Choong Kin (Appointed on 3.4.2012)

Member: Chua Hwa Nian (Appointed on 20.4.2012)

Member: Wong Chook Ping (Resigned on 3.4.2012)

REMUNERATION COMMITTEE


Member: Lee Choong Kin (Appointed on 3.4.2012)


Member: Wong Chook Ping (Resigned on 3.4.2012)

NORMINATION COMMITTEE


Member: Lai Ka Wai


Member: Por Yew Guan (Resigned on 20.4.2012)

COMPANY SECRETARY

Jauhari Bin Hassan LS 03681

REGISTERED OFFICE

Ground Floor, No.8, Lorong Universiti B

Section 16, 46350 Petaling Jaya

Selangor Darul Ehsan

Tel:03-7956 5889 Fax:03-7958 7889

Tel:03-7956

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Annual Report 2012

Corporate Information

PRINCIPAL PLACE OF BUSINESS

Suite 11.07, Level 11, The Garden South Tower

Mid Valley City, Lingkaran Syed Putra

59200 Kuala Lumpur

SHARE REGISTRAR

Symphony Share Registrars Sdn Bhd

Level 6, Symphony House

Pusat Dagangan Dana 1

Jalan PJU 1A/46

47301 Petaling Jaya

Selangor Darul Ehsan

PRINCIPAL BANKERS

AmInvestment Services Berhad

The Hongkong and Shanghai Banking Corporation Limited

AUDITORS

Siew Boon Yeong & Associates AF:0660

Chartered Accountants

STOCK EXCHANGE LISTING

ACE Market of Bursa Malaysia Securities Berhad (“Bursa Securities”)

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Annual Report 2012

Chairman’s Statement

On behalf of the Board of the Directors, I am pleased to present the Annual Report and Audited Financial

Statements of Cybertowers Berhad for the financial year ended 31 August 2012.

Financial Highlights

For the financial year ended (“FYE”) 31 August 2012, the group registered a revenue of RM12.66 million,

representing an increase of RM 8.42 million as compared to RM4.24 million in the previous FYE 31 August

2011. The Group also recorded a consolidated profit after tax of RM 1.95 million as compared to profit after

tax of RM 0.12 million the last year. The increase in revenue and operating profit were mainly due to the

increase in sales to new and existing customers and efforts are still being made to secure more opportunities

to enhance the group’s activities.

Prospects

During the FYE 31 August 2012, the Company made a strategic decision to incorporate subsidiaries in Hong

Kong and Malaysia to streamline its operation. We strive to provide better services and solutions, and at the

same time, cater for future growth of the group. Overall, the group was able to achieve better contribution

from revenue and profit for the year under review, and we strive to upkeep this in the coming year.

The group also shows a better financial position with net cash balances increasing to RM 3.1 million as

compared to RM 1.3 million last year as a result of implementation of business strategy and prudent financial

management.

The Board expects that the stiff competition in the AVL market may continue as competition remains strong

and due to overall slowdown in global economies. Barring unforeseen circumstances, the Board will

continue improving gains and various costs containments, effective deployment of financial resources to

optimise returns, increase market share and undertake other measures.

Acknowledgement and Appreciation

On behalf of the Board, I would like to thank all our staff and management for their perseverance in tackling

the challenges and for their contributions in 2012. The Board also wishes to record a vote of thanks to our

fellow Directors for their counsel and contributions to the Group during their tenure of office.

I would also take this opportunity to express the appreciation of the Board of the continuous support given by

our shareholders and business associates during the year.

Lai Ka Wai

Executive Director

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Annual Report 2012

Profile Of Directors

MR. LAI KA WAI

Hong Kong citizen, aged 40, is an Executive Director of the Company, was appointed to the Board of

Directors on 24 August 2011. He is also a member of the Nomination Committee of the Company.

He has a Bachelor Degree of Science from University of Toronto. He has over 11 years experience in

technology research and development for various technologies such as Short Messaging Service (MMS) and

JAYA (programming language). He is currently an information technology consultant.

Mr. Lai has no direct or indirect shareholdings in the Company. He does not have any family relationship

with any Director of the Company, nor any conflict of interest in any business arrangement involving the

Company. He has had no convictions for any offences within the past ten years.

MR. YUEN CHUN FAI

Hong Kong citizen, aged 34 is an Executive Director of the Company, was appointed to the Board of

Directors on 25 April 2012.

He graduated with a Bachelor degree in Accounting and Finance from London School of Economics and

Political Science. He is also a member of the Association of Chartered Certified Accountants since 2008.

He has over 6 years of experiences in accounting and auditing with an international accountancy and

professional services firm. He also has 3 years commercial experiences. He is currently a financial

executive of the Company.

Mr. Yuen has no direct or indirect shareholdings in the Company. He does not have any family relationship



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Annual Report 2012


MR. LEE CHEE CHENG

Malaysian, aged 43, is an Independent Non-Executive Director of the Company, was appointed to the Board

of Directors on 16 August 2011. He is also the Chairman of Audit Committee, Remuneration Committee

and Nomination Committee of the Company.

He obtained his professional qualification with the Association of Chartered Certified Accountant, United

Kingdom in 1997 and is also a member of the Malaysian Institute of Accountants.

He began his career with Deloitte Kassim Cham, one of the big 5 public accounting firms in 1993. He has in

total 17 years of working experience in audit and commercial sectors specializing in retailing and ICT

industry in Malaysia.

Mr. Lee has no direct or indirect shareholdings in the company. He does not have any family relationship


Company. He has had no convictions for any offences within the past ten years. He holds directorship in

Gpro Technologies Berhad.

MR. LEE CHOONG KIN


of Directors on 3 April 2012. He is also a member of the Audit Committee, Nomination Committee and

Remuneration Committee of the Company.

He has a Bachelor Degree of Information Technology (Information System). He holds a professional

qualification in Certified Novell Engineer, Australia in 1963 and is also a member of The Australian

Computer Society.

He began his career in Arthur Andersen and Co, one of big 4 public accounting firms in 1993. He then

moved to commercial section in 1994 until present. He mainly involved in plastic moulding industries,

office security system and webcam business in information technology industries.

Mr. Lee has no direct or indirect shareholdings in the Company. He does not have any family relationship



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Annual Report 2012


MR. CHUA HWA NIAN


of Directors on 20 April 2012. He is also the member of Audit Committee, Remuneration Committee and

Nomination Committee of the Company.

He holds a Bachelor of Information System Engineering from University of Campbell United State and a

Masters of Business degree in Financing from Open University, Malaysia.

He began his career in Tiong Nam Logistic Solution, one of famous logistic company in present. He has

over 9 years working experience in logistic sectors specializing in supply chain, distribution and operating

industry.

Mr. Chua has no direct or indirect shareholdings in the Company. He does not have any family relationship



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Annual Report 2012

Corporate Governance Statement The Board of Directors of Cybertowres Berhad (“the Board”) recognises the importance of corporate

government requirements outlined in the Malaysian Code on Corporate Governance (Revised 2007) (“the

Code”). The following statement describes the application of the principles and extent of compliance with

the best practices.

A. BOARD OF DIRECTORS

(a) Board Composition and Balance

The Board of Cybertowers consists of five (5) members with two Executive Directors and three

Independent Non-Executive Directors. The Executive Directors are responsible for making and

implementary operational and corporate decisions, the day-to-day management of the business as

well as the implementation of decisions of the Board. Non-Executive Directors plat a pivotal role

in corporate accountability by providing unbiased and independent views in the sharing of

knowledge and experiences towards the formulation of policies and in the decision-making

process.

The current Board brings with a broad range of business, financial and technical background. The

balance enables and the Board to provide clear and effective leadership to the Company and

independent judgment to many aspects of the Company’s strategy and performance.

(b)Board Meetings and Supply of Information

The Boards meets every quarter and additional meetings are held as and when necessary. During

the financial year, the Board has met eight (8) times and their attendances at Board meetings are

set out in the Statement Accompanying Notice of Annual General Meeting.

The Directors are provided with agenda and information necessary for them to review prior to

Board meetings. Senior management staffs are also invited to attend Board meetings when

necessary to provide the Board with further explanation and clarification on matters being tabled

for consideration by the Board. The Board has access to the advice and services of the Company

Secretary and may also seek independent advice, at the Company’s expenses. The Board also has

unlimited access to all information with regard to the activities of the Company.

(c) Appointments to the Board

The Nomination Committee of the Board provides a formal and transparent procedure for the

appointment of new Directors to the Board. The Committee’s primary role is to identify and

recommend to the Board suitable nominees for appointment to the Board.

The Nomination Committee comprised the following members:

Lee Chee Cheng (Chairman) Independent Non- Executive Director

Lai Ka Wai Executive Director

Chua Hwa Nian Independent Non- Executive Director

(Appointed on 20.4.2012)

Por Yew Guan Independent Non- Executive Director

(Resigned on 20.4.2012)

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Annual Report 2012

Corporate Governance Statement

(d)Re-election of Directors

In accordance with the Company’s Article of Association, all Directors who are appointed by the

Board are subject to re-election by shareholders at the Annual General Meeting subsequent to their

appointment and one third of the remaining Directors are subject to re-elction by rotation at each

Annual General Meeting thereafter. In any case, each Director shall retire from office at least once

in every three (3) years. A director over seventy years old is require to submit himself for re-

appointment annually in accordance with Section 129(6) of the Companies Act,1965.

(e) Directors’ Training

All Board members have attended the Mandatory Accreditation Program (“MAP”) pursuant to

Bursa Malaysia Securities Berhad (“Bursa Securities”) guidelines on training for Directors. The

Directors will continue to undergo other relevant training program to further enhance their skills

and knowledge where relevant.

(f) Directors’ Remuneration

The Remuneration Committee of the Company, which was established on 11 November 2003,

recommends to the Board, with the objective of providing assistance to the Board in determining

the remuneration of Executive Directors. In the case of Non-Executive Directors, the Board as a

whole will decide it with the Directors concern abstaining from deliberations and voting on

decision in respect of this individual remuneration.

The following are the members of the Remuneration Committee:

Lee Chee Cheng (Chairman) Independent Non- Executive Director

Lee Choong Kin Independent Non- Executive Director


Chua Hwa Nian Independent Non- Executive Director


The number of Directors whose aggregate remuneration for financial year ended 31 August 2012 is

as follows:-

Executive

(RM’000)

Non-Executive

(RM’000)

Salaries and allowance 57 71

Other emoluments 97 -

Total 154 71

The number of Directors in each remuneration band is as follows:-

Executive Non-Executive

RM0-RM50,000 1 3

RM50,001-RM100,000 1 -

Total 2 3

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Annual Report 2012


B. RELATIONSHIP WITH SHAREHOLDERS AND INVESTORS

The Annual General Meeting (“AGM”) and Extraordinary General Meeting (“EGM”) is the principal

forum for dialogue with public shareholders. Shareholders may enquire about the resolutions being

proposed at the meeting and the financial performance and business operations in general during the

open question and answer session.

The annual report, circulars and announcements made to Bursa Securities are the substantial means of

communicating with its shareholders, institutional and potential investors.

C. ACCOUNTABILITY AND AUDIT

(a) Financial Reporting

The Board has ensured that the annual financial statements presented to the shareholders and the

quarterly results announced to Bursa Securities present a fair assessment of the Company’s

position and prospects. The Audit Committee assists Board in ensuring the accuracy, adequacy and

completeness of information for disclosure.

(b) Internal Control

In discharging its duties in ensuring the effectiveness of the Group’s internal control systems, the

Board has delegated the duty to the Audit Committee. The scope and results of the review are

detailed in Statement of Internal Control set out on page 16 of the Annual report.

(c) Relationship with Auditors

The Board has maintained a formal and transparent relationship with the Auditors. The role of the

Audit Committee in relation to the external auditors is stated on page 13 to page 15 of the Annual

Report.

D. STATEMENTS OF DIRECTORS’ RESPONSIBILITIES IN RELATION TO THE FINANCIAL

STATEMENTS

Directors are required by company law to prepare financial statements for each financial year which

give a true and fair view of the state of affairs of the Company. Such information is communicated to

shareholders and investors through various disclosures and announcements to the Bursa Malaysia,

including the quarterly financial results, annual reports and where appropriate.

In preparing the financial statements, the Directors had to:-

adopted suitable accounting policies and applied them consistently

made adjustments and estimates that are prudent and reasonable

ensured that applicable accounting standards have been followed

prepared the financial statements on the going concern basis

The Directors had prepared the annual financial statements in compliance with the Companies Act,

1965.

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Annual Report 2012


E. COMPLIANCE WITH THE CODE

The Company has to the best of its ability and knowledge complied with the Best Practices in Corporate

Governance set out in Part II of the Code.

F. ADDITIONAL COMPLIACE INFORMATION

(a) Material Contracts

There were no material contracts entered into by the Company involving the Company’s Directors’

and/or substantial shareholders’ interest either still subsisting at the end of the financial year, or

which were entered into since the end of the previous financial year.

(b) Share Buy-back

There were no share buy-back exercises undertaken by the Company during the financial year

under review.

(c) Options, Warrants Or Convertible Securities

There were no options, warrants or convertible securities issued by the Company during the

financial year under review.

(d) American Depository Receipt (ADR) Or Global Depository Receipt (GDR)

There were no ADR or GDR programmers sponsored by the Company during the financial year

under review.

(e) Non-Audit Fees

There were no non-audit fees made to the External Auditors, Messrs Siew Boon Yeong &

Associates during the financial year under review.

(f) Profit Guarantees

There were no profit guarantees given by the Company during the financial year under review.

(g) Imposition Of Sanctions And/ Or Penalties

There were no sanction and/or penalties imposed on the Company, Directors or Management by

any of the regulatory authorities.

(h) Variation In Results

There was no variation in result (differing by 10% or more) from the unaudited results announced.

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Annual Report 2012


(i) Recurrent Related Party Transaction Of A Revenue Or Trading Nature

There was no recurrent related party transaction of revenue or trading nature during the financial

year.

The Company has complied with the Code throughout the financial year ended 31 August 2012.

(j) Statement of Directors’ Responsibility for Preparing the financial statements

In preparing the financial statements, the Directors had:

adopted suitable accounting policies and applied them consistently

made adjustments and estimates that are prudent and reasonable

ensured that applicable accounting standards have been followed

prepared the financial statements on the going concern basis

The Directors had prepared the annual financial statements in compliance with the Companies Act,

1965.

(k) Corporate Social Responsibility Activities and Practices

The Company did not undertake any corporate social responsibility activities or practices during

the financial year ended 31 August 2012.

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Annual Report 2012

Audit Committee Report (a) MEMBERS OF THE AUDIT COMMITTEE

The Audit Committee was established by the Board on 12 August 2002, they are consists of :-

Members Designation

Lee Chee Cheng (Chairman) Independent Non-Executive Director

Lee Choong Kin

(Appointed on 3.4.2012) Independent Non-Executive Director

Chua Hwa Nian

(Appointed on 20.4.2012) Independent Non-Executive Director

Wong Chook Ping

(Resigned on 3.4.2012 ) Non-Executive Chairman

Por Yew Guan

(Resigned on 20.4.2012 ) Independent Non-Executive Director

A brief profile of each of the Audit Committee members is detailed in the Directors’ Profiles on page 6

to page 7 of this Annual Report.

B. TERMS OF REFERENCE

1. Composition of the Audit Committee

The Audit Committee shall appoint by the Board from among their number and shall consist of at

least three (3) members of which the majority shall comprise Independent Directors.

The members of the Committee shall elect a Chairman from among their number who is an

Independent Non-Executive Director.

If a member of the Committee retires, resigns, passed away or for any other reason ceases to be a

member with the result that the number of members is reduced to below three (3), the Board of

Directors shall, within three (3) months of that event, appoint such number of new members as

may be required to make up the minimum of three (3) members.

2. Authority

Wherever necessary and reasonable for the performance of its duties, the Audit Committee shall:-

(i) Investigate any activity within its terms of reference and shall have unrestricted access to the

external auditors and to all employees of the Company;

(ii) Have the resources, which are required to perform its duties as set out in its terms of

reference;

(iii) Have direct communication channels with the external auditors and person(s) carrying out

the internal audit function or activity; and

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Annual Report 2012

Audit Committee Report

(iv) Able to obtain external legal or other independent advice when necessary.

3. Meetings and Reporting

The quorum in respect of a meeting of the Audit Committee shall be a majority of Independent

Directors.

Meetings shall be held not less than four (4) times a year and as and when the Committee deems

necessary.

The Committee may invite other directors and employees to the meetings to brief the Committee

on issues that are incorporated into the agenda.

The Company Secretary shall act as Secretary of the Audit Committee and shall be responsible, in

conjunction with the Chairman, for drawing up the agenda and other supporting explanatory

documents for circulation to the Committee Members prior to each meeting. The Secretary shall

be responsible for keeping the minutes of the meetings, circulating them to committee members

and ensuring compliance with Bursa Securities requirements.

Significant results and findings from the Committee’s deliberation shall be put in writing and

issued to the Board. The Committee shall submit an annual report to the Board summarizing its

activities and significant findings during the year.

4. Duties

The duties of the Audit Committee include the followings:-

(i) to consider the appointment, resignation and dismissal of external auditors and the audit fee;

(ii) to review the nature and scope of the audit with the external auditors before the audit

commences;

(iii) to review the quarterly and annual financial statements of the Company focusing particularly

on:-

(a) any changes in accounting policies and practices;

(b) significant adjustments arising from the audit, significant and unusual events;

(c) the going concern assumption; and

(d) compliance with accounting standards and other legal requirements.

(iv) to review the adequacy of the scope, functions, authority and resources of the internal audit

function;

(v) to review the internal audit program and results, ensuring that appropriate action is taken on

the recommendations of the internal audit function;

(vi) to consider related party transactions and review the procedures to ensure appropriateness

and adequacy; and to perform any other functions as authorised by the Board.

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Annual Report 2012

Audit Committee Report

5. Summary of Activities

The Audit Committee met five (5) times during the financial year ended 31 August 2012.

Details of the number of meetings attended by each member are as follows:-

Members

Number of

meetings held

during members’

tenure in office

Number of

meetings attended

by members

Lee Chee Cheng (Chairman) 5 5

Lee Choong Kin

(Appointed on 3.4.2012) 2 2

Chua Hwa Nian

(Appointed on 20.4.2012) 2 2

Wong Chook Ping

(Resigned on 3.4.2012) 3 3

Por Yew Guan

(Resigned on 20.4.2012) 3 3

During the financial year ended 31 August 2012, the Audit Committee reviewed the quarterly

and yearly results / announcements of the Company and ensures compliance with approved

accounting standards and adherence to other legal and regulatory requirements as well as

making relevant recommendations to the Board for approval.

6. Internal Audit Function

During the financial year, the Group’s internal audit function is outsourced to an independent

professional firm who assesses the adequacy and integrity of the internal control system and

reports directly to the Audit Committee. Its principal role is to conduct regular and systematic

review of system of internal control so as to provide independent assurance on the adequacy and

effectiveness of internal control processes.

The Internal Auditor has conducted assurance review on adequacy and effectiveness of internal

control system on certain operating units and presented its findings together with recommendation

and management action to Audit Committee for review.

A number of minor internal control problems were identified, all of which have been or being

addressed. None of the weakness has resulted in any material losses or uncertainties that would

require disclosure in this Annual Report.

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Annual Report 2012

Statement On Internal Control The Board of Directors (“the Board”) of Cybertowers Berhad is pleased to provide the following Statement

on Internal Control, which outlines the nature and features of internal controls within the Group to safeguard

shareholders’ investments and assets for the financial year ended 31 August 2012.

Responsibilities

The Board recognizes the importance of maintaining a sound system of internal control and risk management.

The Board acknowledges its responsibilities to: -

a) Identify key risks and ensure implementation of appropriate control measures to manage the risks; and

b) Review the adequacy and integrity of the internal control system.

The system is designed to manage rather than eliminate the risk of failure to achieve the corporate objectives

and to provide reasonable but not absolute assurance against material misstatement or loss.

Risk Management Framework

Key management staff and Heads of Department are delegated with the responsibility to manage risks of

their respective areas of responsibilities. In the periodic management meetings, key risks and mitigating

controls are deliberated. Significant risks affecting the Group’s strategic and business plans are escalated to

the Board at their scheduled meetings.

The abovementioned risk management practices of the Group serve as the on-going process used to identify,

evaluate and manage significant risks. The Board shall continue to evaluate the Group’s risk management

process to ensure it remains relevant to the Group’s requirements.

Internal Audit

The Group’s internal audit function is outsourced to an independent professional firm who assesses the

adequacy and integrity of the internal control system and reports directly to the Audit Committee. An

internal audit plan for 2012 was approved by the Audit Committee and carried out. The results of the

internal audit review and the recommendations for improvement were presented to the Audit Committee.

The cost of outsourcing the internal audit function for the year ended 31 August 2012 was RM6,560.

Key Features of Internal Control

The key features of the Group’s internal control are as follows:

1. An annual budget is prepared to facilitate the monitoring of Group’s financial performance and review

its actual performance against the budget.

2. Quarterly review of the financial performance of the Group by the Board and the Audit Committee.

3. The Group has established policies and procedures.

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Annual Report 2012

CYBERTOWERS BERHAD (Incorporated in Malaysia)

DIRECTORS' REPORT

The directors hereby submit their report together with the audited financial statements of the Group and of

the Company for the financial year ended 31 August 2012.

PRINCIPAL ACTIVITIES

The principal activity of the Company is engaged in the business of developing and operating an internet

based automatic vehicle locating system using satellite and wireless telecommunication solutions. The

principal activities of the subsidiary companies are as set out in Note 7 to the financial statements.

There were no significant changes in the nature of these activities during the financial year.

FINANCIAL RESULTS

Group Company

RM RM

Profit attributable to:-

Owners of the parent 1,951,396 2,174,306

In the opinion of the directors, the results of the operations of the Group and of the Company during the

financial year were not substantially affected by any item, transaction or event of a material and unusual

nature other than as disclosed in the financial statements.

DIVIDEND

No dividend has been paid, declared or proposed since the end of the previous financial year. The directors

do not recommend the payment of any dividend in respect of the current financial year.

MOVEMENTS ON RESERVES AND PROVISIONS

There were no material transfers to or from reserves or provisions during the financial year other than as

disclosed in the financial statements.

ISSUE OF SHARES AND DEBENTURES

There was no issue of shares or debentures by the Company during the financial year.

OPTIONS

No option has been granted during the financial year to take up unissued shares of the Company.

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Annual Report 2012

DIRECTORS

The directors in office since the date of the last report are:

Lai Ka Wai

Lee Chee Cheng

Yuen Chun Fai (appointed on 25.4.2012)

Chua Hwa Nian (appointed on 20.4.2012)

Lee Choong Kin (appointed on 3.4.2012)

Wong Chook Ping (resigned on 3.4.2012)

Wong Kek Wei (resigned on 22.6.2012)

Por Yew Guan (resigned on 20.4.2012)

DIRECTORS' INTERESTS

According to the Register of Directors' Shareholdings, none of the directors in office at end of the financial

year had any interest in shares in the Company or its related corporations during the financial year.

DIRECTORS' BENEFITS

Since the end of the previous financial year, no director has received or become entitled to receive a benefit

(other than benefits included in the aggregate amount of emoluments received or due and receivable by the

directors as shown in Note 23 to the financial statements or a fixed salary of a full-time employee of the

Company) by reason of a contract made by the Company or a related corporation with the director or with a

firm of which the director is a member, or with a Company in which the director has a substantial financial

interest.

Neither during nor at the end of the financial year was the Company a party to any arrangement whose object

was to enable the directors to acquire benefits through the acquisition of shares in, or debentures of the

Company or any other body corporate.

OTHER STATUTORY INFORMATION

Before the financial statements 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 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 expected realisable values.

At the date of this report, the directors are not aware of any circumstances:

(a) which would render the amounts written off of bad debts or the amount of the allowance for doubtful

debts in the financial statements inadequate to any substantial extent or the values attributed to current

assets misleading; and

(b) 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.

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Annual Report 2012

In the interval between the end of the financial year and the date of this report:

(a) no item, transaction or event of a material and unusual nature has arisen which, in the opinion of the

directors, would substantially affect the results of the operations of the Group and of the Company for

the current financial year; and

(b) no charge has arisen on the assets of the Group and of the Company which secures the liabilities of any

other person nor has any contingent liability arisen in the Group and of the Company.

No contingent or other liability of the Group and of the Company has become enforceable or is likely to

become enforceable within the period of twelve months after the end of the financial year which, in the

opinion of the directors, will or may affect the ability of the Group and of the Company to meet its

obligations when they fall due.

At the date of this report, the directors are not aware of any circumstances not otherwise dealt with in this

report or the financial statements which would render any amount stated in the financial statements

misleading.

SIGNIFICANT EVENTS DURING THE FINANCIAL YEAR

(i) On 6 September 2011, the Company incorporated two wholly-owned subsidiaries in Malaysia under the

names of Imagine Data Sdn. Bhd. (“IDSB”) and Nautical Angle Sdn. Bhd. (“NASB”). The issued and

paid-up share capital of IDSB and NASB are 2 ordinary shares of RM1 each, respectively.

(ii) On 8 March 2012, the Company acquired the entire issued and paid-up share capital of King Arts

Limited, a company incorporated in Hong Kong, representing 1 ordinary share for a total consideration

of Hong Kong Dollar 1.

(iii) On 16 July 2012, the Company acquired the entire issued and paid-up share capital of Pioneer Streams

Consolidated Sdn. Bhd. (“PSCSB”), a company incorporated in Malaysia, representing 100,000

ordinary shares of RM1 each for a total consideration of RM200,000.

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Annual Report 2012

AUDITORS

The auditors, Messrs Siew Boon Yeong & Associates, Chartered Accountants, have expressed their

willingness to continue in office.

Signed on behalf of the Board of Directors in

accordance with a resolution of the Directors

LAI KA WAI

Director

YUEN CHUN FAI

Director

Kuala Lumpur,

Date: 27 December 2012

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Annual Report 2012

CYBERTOWERS BERHAD

(Incorporated in Malaysia)

STATEMENT BY DIRECTORS

In the opinion of the directors, the financial statements set out on pages 24 to 64 are drawn up in accordance

with the provisions of the Companies Act, 1965 and Financial Reporting Standards so as to exhibit a true and

fair view of the state of affairs of the Group and of the Company as at 31 August 2012 and of the results and

cash flows of the Group and of the Company for the year ended on that date.

The information set out in Note 31 on page 64 to the financial statements have been prepared in accordance

with the Guidance on Special Matter No. 1, Determination of Realised and Unrealised Profits or Losses in

the Context of Disclosure Pursuant to Bursa Malaysia Securities Berhad Listing Requirements, as issued by

the Malaysian Institute of Accountants.

Signed in Kuala Lumpur on 27 December 2012

Signed on behalf of the Board of Directors in

accordance with a resolution of the Directors

LAI KA WAI

YUEN CHUN FAI

STATUTORY DECLARATION

I, Yuen Chun Fai, being the director primarily responsible for the financial management of Cybertowers

Berhad, do solemnly and sincerely declare that to the best of my knowledge and belief the financial

statements set out on pages 24 to 64 are correct, and I make this solemn declaration conscientiously believing

the same to be true and by virtue of the provisions of the Statutory Declarations Act, 1960.

Subscribed and solemnly

declared in Kuala Lumpur on 27 December 2012

YUEN CHUN FAI

Before me:

ABD RAHMAN BIN ZAHARI [W599] Commissioner for Oaths

Kuala Lumpur

22


Annual Report 2012

INDEPENDENT AUDITORS’ REPORT TO THE MEMBERS OF

CYBERTOWERS BERHAD

(Incorporated in Malaysia)

Report on the Financial Statements

We have audited the financial statements of Cybertowers Berhad, which comprise the statements of financial

position as at 31 August 2012 of the Group and of the Company, 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 24 to 64.

Directors’ Responsibility for the Financial Statements

The directors of the Company are responsible for the preparation of financial statements that give a true and

fair view in accordance with the provisions of the Companies Act, 1965 and Financial Reporting Standards,

and for such internal control as the directors determine are 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 about

whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the

financial statements. The procedures selected depend on our judgement, including the assessment of risks of

material misstatement of the financial statements, whether due to fraud or error. In making those risk

assessments, we consider internal control relevant to the entity’s preparation of financial statements that give

a true and fair view in order to design audit procedures that are appropriate in the circumstances, but not for

the purpose of expressing an opinion on the effectiveness of the entity’s internal control. An audit also

includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting

estimates made by the directors, as well as evaluating the overall presentation of the financial statements.

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

audit opinion.

Opinion

In our opinion, the financial statements have been properly drawn up in accordance with the provisions of the

Companies Act, 1965 and Financial Reporting Standards so as to give a true and fair view of the financial

position of the Group and of the Company as of 31 August 2012 and of its financial performance and cash

flows for the year then ended.

23


Annual Report 2012

Report on Other Legal and Regulatory Requirements

In accordance with the requirements of the Companies Act, 1965 in Malaysia, we also report the following:

(a) In our opinion the accounting and other records and the registers required by the Act to be kept by the

Company and its subsidiaries of which we have acted as auditors have been properly kept in accordance

with the provisions of the Act.

(b) We have considered the financial statements and the auditors’ reports of all the subsidiaries of which we

have not acted as auditors, which are indicated in Note 7 to the financial statements.

(c) We are satisfied that the financial statements of the subsidiaries that have been consolidated with the

Company’s financial statements are in form and content appropriate and proper for the purposes of the

preparation of the financial statements of the Group and we have received satisfactory information and

explanations required by us for those purposes.

(d) The auditors’ reports on the financial statements of the subsidiaries did not contain any qualification or

any adverse comment made under Section 174(3) of the Act.

Other Reporting Responsibilities

The supplementary information set out in Note 31 on page 64 is disclosed to meet the requirements of Bursa

Malaysia Securities Berhad. 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

This report is made solely to the members of the Company, as a body, in accordance with Section 174 of the

Companies Act, 1965 in Malaysia and for no other purpose. We do not assume responsibility to any other

person for the content of this report.

SIEW BOON YEONG & ASSOCIATES [AF: 0660]

Chartered Accountants

SIEW BOON YEONG [1321 / 7 / 14 (J)]

Kuala Lumpur,

Date: 27 December 2012

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

24


Annual Report 2012

Group

2012 2012 2011

Note RM RM RM

ASSETS

NON-CURRENT ASSETS

Property, plant and equipment 5 8,775,386 1,563,550 2,307,358

Intangible assets 6 222,340 142,164 282,599

Investments in subsidiary companies 7 - 200,005 -

8,997,726 1,905,719 2,589,957

CURRENT ASSETS

Inventories 8 22,406 - 1,046,113

Trade receivables 9 1,875,714 1,157,148 1,704,019

Other receivables, deposits and

prepayments 10 376,813 39,994 169,567

Amounts owing by subsidiary

companies 11 - 4,582,080 -

Fixed deposits with licensed banks 12 361,250 211,250 1,291,576

Cash and bank balances 2,984,957 1,228,170 76,313

5,621,140 7,218,642 4,287,588

TOTAL ASSETS 14,618,866 9,124,361 6,877,545

Company

CYBERTOWERS BERHAD(Incorporated in Malaysia)

STATEMENTS OF FINANCIAL POSITION

as at 31 August 2012


Annual Report 2012


25

Group

2012 2012 2011

Note RM RM RM

EQUITY AND LIABILITIES

EQUITY

Share capital 13 10,000,000 10,000,000 10,000,000

Share premium 14 2,032,070 2,032,070 2,032,070

Foreign exchange translation reserve 15 3,696 - -

Accumulated losses (3,610,630) (3,387,720) (5,562,026)

TOTAL EQUITY 8,425,136 8,644,350 6,470,044

NON-CURRENT LIABILITIES

Amount owing to a shareholder 16 1,500,000 - -

CURRENT LIABILITIES

Trade payables 17 403,654 - 13,367

Other payables and accruals 18 525,367 480,011 389,484

Amount owing to a shareholder 16 3,764,709 - -

Hire purchase payables 19 - - 4,650

4,693,730 480,011 407,501

TOTAL LIABILITIES 6,193,730 480,011 407,501

TOTAL EQUITY AND LIABILITIES 14,618,866 9,124,361 6,877,545

Company


STATEMENTS OF FINANCIAL POSITION

as at 31 August 2012


Annual Report 2012


26

Group

2012 2012 2011

Note RM RM RM

REVENUE 20 12,664,591 5,762,420 4,241,686

COST OF SALES (6,505,969) (1,528,401) (1,620,894)

GROSS PROFIT 6,158,622 4,234,019 2,620,792

OTHER OPERATING INCOME 590,282 143,221 211,961

OTHER OPERATING EXPENSES (4,797,419) (2,202,845) (2,708,844)

PROFIT FROM OPERATIONS 1,951,485 2,174,395 123,909

FINANCE COSTS 21 (89) (89) (966)

PROFIT BEFORE TAXATION 22 1,951,396 2,174,306 122,943

INCOME TAX EXPENSE 24 - - -

PROFIT AFTER TAXATION 1,951,396 2,174,306 122,943

OTHER COMPREHENSIVE

INCOME NET OF TAX:

Foreign currency translation

differences for foreign operations 3,696 - -

TOTAL OTHER COMPREHENSIVE

INCOME FOR THE YEAR 3,696 - -

TOTAL COMPREHENSIVE

INCOME FOR THE YEAR 1,955,092 2,174,306 122,943

PROFIT ATTRIBUTABLE TO:

Owners of the parent 1,951,396 2,174,306 122,943

TOTAL COMPREHENSIVE INCOME

ATTRIBUTABLE TO:

Owners of the parent 1,955,092 2,174,306 122,943

BASIC EARNINGS PER SHARE

- Basic (sen) 25 1.95 2.17 0.12

Company


STATEMENTS OF COMPREHENSIVE INCOME

for the year ended 31 August 2012


Annual Report 2012


27

Share capital

Share

premium

Foreign

exchange

translation

reserve

Accumulated

losses Total equity

RM RM RM RM RM

Group

Balance at 1 September 2010 10,000,000 2,032,070 - (5,684,969) 6,347,101

Profit for the year/Total comprehensive income for the year - - - 122,943 122,943

Balance at 31 August 2011 10,000,000 2,032,070 - (5,562,026) 6,470,044

Foreign currency translation differences for foreign operations - - 3,696 - 3,696

Total other comprehensive income for the year - - 3,696 - 3,696

Profit for the year - - - 1,951,396 1,951,396

Total comprehensive income for the year - - 3,696 1,951,396 1,955,092

Balance at 31 August 2012 10,000,000 2,032,070 3,696 (3,610,630) 8,425,136

Company

Balance at 1 September 2010 10,000,000 2,032,070 - (5,684,969) 6,347,101

Profit for the year/Total comprehensive income for the year - - - 122,943 122,943

Balance at

31 August 2011 10,000,000 2,032,070 - (5,562,026) 6,470,044

Profit for the year/Total

comprehensive income

for the year - - - 2,174,306 2,174,306

Balance at

31 August 2012 10,000,000 2,032,070 - (3,387,720) 8,644,350

<---------- Non-distributable ---------->


STATEMENTS OF CHANGES IN EQUITY



Annual Report 2012

28

2012 2012 2011

Note RM RM RM

CASH FLOWS FROM OPERATING

ACTIVITIES

Profit before taxation 1,951,396 2,174,306 122,943

Adjustments for:

Amortisation of development

expenditures 140,435 140,435 151,448

Depreciation 1,849,002 374,090 569,449

Interest expenses 89 89 966

Property, plant and equipment

written off 381,663 367,202 -

Write-down of inventories 600,000 600,000 -

Gain on foreign exchange - unrealised (77,840) (71,696) -

Gain on disposal of property,

plant and equipment (59,930) (59,930) -

Interest income (12,902) (11,595) (36,011)

Operating profit before working changes 4,771,913 3,512,901 808,795

Decrease/(increase) in inventories 423,707 446,113 (53,511)

Increase in receivables (372,421) (3,833,940) (223,408)

Increase/(decrease) in payables 524,534 77,160 (157,261)

Cash generated from operations 5,347,733 202,234 374,615

Interest received 12,902 11,595 36,011

Interest paid (89) (89) (966)

Net cash generated from operating activities 5,360,546 213,740 409,660

Group Company


STATEMENTS OF CASH FLOWS



Annual Report 2012

The accompanying notes form an integral part of the financial statements. 29

2012 2012 2011

Note RM RM RM

CASH FLOWS FROM INVESTING

ACTIVITIES

Addition of intangible assets - - (31,833)

Purchase of property, plant

and equipment (8,662,542) (1,554) (304,356)

Proceeds from disposal of property,

plant and equipment 64,000 64,000 -

Investment in subsidiary companies - (200,005) -

Net cash outflow from acquisition

of subsidiary companies 26 (98,238) - - Net cash used in investing activities (8,696,780) (137,559) (336,189)

CASH FLOWS FROM FINANCING

ACTIVITIES

Net advances from a shareholder 5,271,375 - -

Repayment of hire purchase payables (4,650) (4,650) (17,286)

Placement of fixed deposits pledged as

securities (211,250) (211,250) - Net cash generated from/(used in)

financing activities 5,055,475 (215,900) (17,286)

Net increase in cash and

cash equivalents 1,719,241 (139,719) 56,185 Cash and cash equivalents at

beginning of year 1,367,889 1,367,889 1,311,704 Effect of foreign exchange rate

changes, net 47,827 - - Cash and cash equivalents at

end of year 3,134,957 1,228,170 1,367,889

NOTE TO STATEMENTS OF CASH FLOWS:

Cash and cash equivalents comprise:


Fixed deposits with licensed banks 361,250 211,250 1,291,576

3,346,207 1,439,420 1,367,889 Less: Fixed deposits pledged with

licensed banks (211,250) (211,250) -

3,134,957 1,228,170 1,367,889

Group Company


STATEMENTS OF CASH FLOWS



Annual Report 2012

30

NOTES TO THE FINANCIAL STATEMENTS - 31 August 2012

1. PRINCIPAL ACTIVITIES AND GENERAL INFORMATION

The principal activity of the Company is engaged in the business of developing and operating an internet

based automatic vehicle locating system using satellite and wireless telecommunication solutions. The

principal activities of the subsidiary companies are as set out in Note 7 to the financial statements. There

were no significant changes in the nature of these activities during the financial year.

The Company is a public limited company, incorporated and domiciled in Malaysia, and is listed on the

ACE Market of Bursa Malaysia Securities Berhad.

The address of the registered office of the Company is Ground Floor, No. 8, Lorong Universiti B,

Section 16, 46350 Petaling Jaya, Selangor.

The address of the principal place of business of the Company is Suite 11.07, Level 11, The Gardens

South Tower, Mid Valley City, Lingkaran Syed Putra, 59200 Kuala Lumpur.

The financial statements are presented in Ringgit Malaysia (RM), which is also the Group’s and

Company’s functional currency.

2. BASIS OF PREPARATION OF THE FINANCIAL STATEMENTS

The financial statements of the Group and of the Company have been prepared in accordance with the

provisions of the Companies Act, 1965 and Financial Reporting Standards (“FRS”). The financial

statements have been prepared under the historical cost convention, except as disclosed in the

accounting policies below.

Accounting policies adopted by the Group and of the Company have been applied consistently in

dealing with items that are considered material in relation to the financial statements, unless otherwise

stated.

(a) The Group and the Company have adopted the following new and revised FRSs and IC

Interpretations that are effective for the financial year beginning on or after 1 September 2011:

FRS 1 (Revised): First-time Adoption of Financial Reporting Standards

FRS 3 (Revised): Business Combinations

FRS 127 (Revised): Consolidated and Separate Financial Statements

Amendments to FRS 1 (Revised): Limited Exemption from Comparative FRS 7 Disclosures for

First-time Adopters

Amendments to FRS 2: Share-based Payment

Amendment to FRS 2: Group Cash-settled Share-based Payment

Transactions

Amendment to FRS 5: Plan to Sell the Controlling Interest in a Subsidiary

Amendments to FRS 7: Financial Instruments: Disclosures - Improving Disclosures about

Financial Instruments


Annual Report 2012

31

Amendments to FRS 138: Consequential Amendments Arising from FRS 3 (Revised)

IC Interpretation 4: Determining Whether An Arrangement Contains a Lease

IC Interpretation 12: Service Concession Arrangements

IC Interpretation 16: Hedges of a Net Investment in a Foreign Operation

IC Interpretation 17: Distributions of Non-cash Assets to Owners

IC Interpretation 18: Transfer of Assets from Customers

IC Interpretation 19: Extinguishing Financial Liabilities with Equity Instruments

Amendments to IC Interpretation 14: Prepayments of a Minimum Funding Requirement

Amendments to IC Interpretation 9: Reassessment of Embedded Derivatives

Improvements to FRSs issued in 2010

The adoption of the above new and revised FRSs and IC Interpretation did not have a significant

impact on the financial statements of the Group and of the Company other than the disclosures

required under the Amendments to FRS 7.

Amendments to FRS 7: Financial Instruments: Disclosures

FRS 7: Disclosures on fair value and liquidity have been enhanced upon the adoption of this

amendment. In particular, financial instruments measured at fair value are disclosed by class in a

three-level fair value measurement hierarchy, with specific disclosures related to transfers between

levels in the hierarchy and detailed disclosures on level three of the fair value hierarchy. Certain

disclosures on liquidity are also modified. The adoption of this amendment resulted in additional

disclosures in the financial statements but does not have any financial impact to the financial

statement for the current financial year.

(b) Malaysian Financial Reporting Standards

On 19 November 2011, the Malaysian Accounting Standards Board (“MASB”) announced the

adoption of the Malaysian Financial Reporting Standards (“MFRS Framework”) to facilitate

convergence with the International Financial Reporting Standards (“IFRS”).

The MFRS Framework is to be applied by all Entities Other Than Private Entities for annual

periods beginning on or after 1 January 2012, with the exception of entities that are within the

scope of MFRS 141: Agriculture and IC Interpretation 15: Agreements for Construction of Real

Estate, including its parent, significant investor and venturer.

The Group will be required to prepare financial statements using the MFRS Framework in its first

MFRS financial statements for the year ending 31 August 2013. In presenting its first MFRS

financial statements, the Group will be required to restate the comparative financial statements to

amounts reflecting the application of MFRS Framework. The majority of the adjustments required

on transition will be made, retrospectively, against opening accumulated losses.


Annual Report 2012

32

The Group has started a preliminary assessment of the differences between FRS and accounting

standards under the MFRS Framework and are in the process of assessing the financial effects of

the differences. Accordingly, the financial performance and financial position as disclosed in these

financial statements for the year ended 31 August 2012 could be different if prepared under the

MFRS Framework.

The Group expects to be in a position to fully comply with the requirements of the MFRS

Framework for the financial year ending 31 August 2013.

3. SIGNIFICANT ACCOUNTING POLICIES

All significant accounting policies set out below are consistent with those applied in the previous

financial year unless otherwise stated.

(a) Basis Of Consolidation

The financial statements of the Group include the audited financial statements of the Company and

its subsidiaries made up to the end of the financial year. The financial statements of the

subsidiaries used in the preparation of the consolidated financial statements are prepared for the

same reporting date as the Company. Consistent accounting policies are applied to like transactions

and events in similar circumstances.

All intra-group balances, income and expenses and unrealised gains and losses resulting from

intra-group transactions are eliminated in full.

Acquisition of subsidiaries is accounted for by applying the acquisition method. Under the

acquisition method of accounting, identifiable assets acquired and liabilities assumed in a business

combination are measured initially at their fair values at the acquisition date. Acquisition-related

costs are recognised as expenses in the periods in which the costs are incurred and the services are

received.

In business combinations achieved in stages, previously held equity interests in the acquiree are re-

measured to fair value at the acquisition date and any corresponding gain or loss is recognised in

profit or loss.

The Group elects, for each individual business combination, whether to recognise non-controlling

interest in the acquiree (if any) at fair value on the acquisition date, or the non-controlling interest’s

proportionate share of the acquiree’s net identifiable assets.

Any excess of the sum of the fair value of the consideration transferred in the business

combination, the amount of non-controlling interest in the acquiree (if any), and the fair value of

the Group’s previously held equity interest in the acquiree (if any), over the net fair value of the

acquiree’s identifiable assets and liabilities is recorded as goodwill in the statements of financial

position. In instances where the latter amount exceeds the former, the excess is recognised as a

gain on bargain purchase in profit or loss on the acquisition date.


Annual Report 2012

33

(b) Research And Development Expenditures

Research expenditure is recognised as an expense when it is incurred.

Development expenditures are recognised as an expense except that expenditure incurred on

development projects relating to the design and testing of new or improved products or process are

recognised as intangible assets if, and only if an entity can demonstrate all of the following:-

i its ability to measure reliably the expenditure attributable to the assets under development;

ii the product or process is technically and commercially feasible;

iii its future economic benefits are probable;

iv its ability to use or sell the developed asset; and

v the availability of adequate technical, financial and other resources to complete the asset

under development.

Capitalised development expenditures are measured at cost less accumulated amortisation and

impairment losses, if any. Development expenditures initially recognised as an expense is not

recognised as assets in the subsequent period.

Development expenditures are amortised on a straight-line basis over a period of five years.

Impairment is assessed whenever there is an indication of impairment and the amortisation period

and method are also reviewed at each statements of financial position date.

(c) Goodwill

Goodwill is measured at cost less accumulated impairment losses, if any. The carrying value of

goodwill is reviewed for impairment annually. The impairment value of goodwill is recognised

immediately in profit or loss. An impairment loss recognised for goodwill is not reversed in a

subsequent period.

Under the purchase method, goodwill represents the excess of the fair value of the purchase

consideration over the Group’s share of the fair values of the identifiable assets, liabilities and

contingent liabilities of the subsidiaries at the date of acquisition.

If, after reassessment, the Group’s interest in the fair values of the identifiable net assets of the

subsidiaries exceeds the cost of the business combinations, the excess is recognised as income

immediately in statements of comprehensive income.

(d) Investments In Subsidiary Companies

Subsidiary companies are those companies in which the Group has power to exercise control over

their financial and operating activities so as to obtain benefits therefrom.

Investments in subsidiaries are stated at cost and are written down when there is a permanent

impairment in the value of the investments. The impairment loss is recognised in the statements of

comprehensive income.

On disposal of an investment, the difference between net disposal proceeds and their carrying

amounts is charged or credited to statements of comprehensive income.


Annual Report 2012

34

(e) Inventories

Inventories are valued at the lower of cost and net realisable value.

Cost is determined using first in first out method. Cost included purchase price and incidentals

incurred in bringing the inventories to their present location and condition.

Net realisable value is the estimate of the selling price in the ordinary course of business, less the

estimated cost of completion and selling expenses. Allowances are made where necessary for

obsolete, slow-moving and defective stocks.

(f) Property, Plant And Equipment

Property, plant and equipment are stated at historical cost less accumulated depreciation and

impairment losses where applicable.

Property, plant and equipment are depreciated on a straight line basis to write off the cost of each

asset to their residual values over their estimated useful lives at the following annual rates:

%

Computers and GSM tracking devices and servers 12 - 20

Furniture, fittings and office equipment

Motor vehicles

10

10

Renovation 10

The residual value, useful lives and depreciation method of property, plant and equipment are

reviewed at each statements of financial position date. An asset’s carrying amount is written down

immediately to its recoverable amount if the asset’s carrying amount is greater than its estimated

recoverable amount.

On disposal of property, plant and equipment, the difference between the net disposal proceeds and

the carrying amount is credited or charged to the statements of comprehensive income in

determining profit from operations.

(g) Financial Instruments

Financial instruments are recognised in the statements of financial position when the Group has

become a party to the contractual provisions of the instruments.

Financial instruments are classified as liabilities or equity in accordance with the substance of the

contractual arrangement. Interest, dividends, gains and losses relating to a financial instrument

classified as a liability, are reported as an expense or income. Distributions to holders of financial

instruments classified as equity are charged directly to equity.

Financial instruments are offset when the Group has a legally enforceable right to offset and

intends to settle either on a net basis or to realise the asset and settle the liability simultaneously.

A financial instrument is recognised initially, at its fair value plus, in the case of a financial

instrument not at fair value through profit or loss, transaction costs that are directly attributable to

the acquisition or issue of the financial instrument.

Financial instruments recognised in the statements of financial position are disclosed in the

individual policy statement associated with each item.


Annual Report 2012

35

(i) Financial Assets

On initial recognition, financial assets are classified as either financial assets at fair value

through profit or loss, loans and receivables, held-to-maturity investments, or available-for-

sale financial assets, as appropriate.

Financial Assets at Fair Value Through Profit or Loss

Financial assets are classified as financial assets at fair value through profit or loss

when the financial asset is either held for trading or is designated to eliminate or

significantly reduce a measurement or recognition inconsistency that would otherwise

arise. Derivatives are also classified as held for trading unless they are designated as

hedges.

Financial assets at fair value through profit or loss are stated at fair value, with any

gains or losses arising on remeasurement recognised in profit or loss. Dividend income

from this category of financial assets is recognised in profit or loss when the Group’s

right to receive payment is established.

Held-to-maturity Investments

Held-to-maturity investments are non-derivative financial assets with fixed or

determinable payments and fixed maturities that the management has the positive

intention and ability to hold to maturity. Held-to-maturity investments are measured at

amortised cost using the effective interest method less any impairment loss, with

revenue recognised on an effective yield basis.

Loans and Receivables Financial Assets

Trade receivables and other receivables that have fixed or determinable payments that

are not quoted in an active market are classified as loans and receivables financial

assets. Loans and receivables financial assets are measured at amortised cost using the

effective interest method, less any impairment loss. Interest income is recognised by

applying the effective interest rate, except for short-term receivables when the

recognition of interest would be immaterial.

Available-for-sale Financial Assets

Available-for-sale financial assets are non-derivative financial assets that are

designated in this category or are not classified in any of the other categories.

After initial recognition, available-for-sale financial assets are remeasured to their fair

values at the end of each reporting period. Gains and losses arising from changes in

fair value are recognised in other comprehensive income and accumulated in the fair

value reserve, with the exception of impairment losses. On derecognition, the

cumulative gain or loss previously accumulated in the fair value reserve is reclassified

from equity into profit or loss.

Dividends on available-for-sale equity instruments are recognised in profit or loss

when the Company’s right to receive payments is established.

Investments in equity instruments whose fair value cannot be reliably measured are

measured at cost less accumulated impairment losses, if any.


Annual Report 2012

36

(ii) Financial Liabilities

All financial liabilities are initially at fair value plus directly attributable transaction costs

and subsequently measured at amortised cost using the effective interest method other than

those categorised as fair value through profit or loss.

Fair value through profit or loss category comprises financial liabilities that are either held

for trading or are designated to eliminate or significantly reduce a measurement or

recognition inconsistency that would otherwise arise. Derivatives are also classified as held

for trading unless they are designated as hedges

(iii) Equity Instruments

Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of

new shares or options are shown in equity as a deduction, net of tax, from proceeds.

Dividends on ordinary shares are recognised as liabilities when approved for appropriation.

A financial asset is derecognised when, and only when the contractual rights to the cash flows from

the financial asset expire or the financial asset is transferred to another party without retaining

control or substantially all risks and rewards of the asset. On derecognition of a financial asset, the

difference between the carrying amount and the sum of the consideration received (including any

new asset obtained less any new liability assumed) and any cumulative gain or loss that had been

recognised in equity is recognised in profit or loss.

A financial liability is derecognised when, and only when, the obligation specified in the contract

is discharged or cancelled or expires. On derecognition of a financial liability, the difference

between the carrying amount of the financial liability extinguished or transferred to another party

and the consideration paid, including any non-cash assets transferred or liabilities assumed, is

recognised in profit or loss.

(h) Impairment

(i) Impairment of Financial Assets

All financial assets (other than those categorised at fair value through profit or loss), are

assessed at the end of each reporting period whether there is any objective evidence of

impairment as a result of one or more events having an impact on the estimated future cash

flows of the asset. For an equity instrument, a significant or prolonged decline in the fair

value below its cost is considered to be objective evidence of impairment.

An impairment loss in respect of held-to-maturity investments and loans and receivables

financial assets is recognised in profit or loss and is measured as the difference between the

asset’s carrying amount and the present value of estimated future cash flows, discounted at

the financial asset’s original effective interest rate.

An impairment loss in respect of available-for-sale financial assets is recognised in profit or

loss and is measured as the difference between its cost (net of any principal payment and

amortisation) and its current fair value, less any impairment loss previously recognised in the

fair value reserve. In addition, the cumulative loss recognised in other comprehensive

income and accumulated in equity under fair value reserve, is reclassified from equity to

profit or loss.


Annual Report 2012

37

With the exception of available-for-sale equity instruments, 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. In respect of available-for-sale equity

instruments, impairment losses previously recognised in profit or loss are not reversed

through profit or loss. Any increase in fair value subsequent to an impairment loss made is

recognised in other comprehensive income.

(ii) Impairment of Non-financial Assets

The carrying amounts of assets, other than those to which FRS 136 - Impairment of Assets

does not apply, are reviewed at each end of the reporting period for impairment when there is

an indication that the assets might be impaired. Impairment is measured by comparing the

carrying values of the assets with their recoverable amounts. The recoverable amount of the

assets is the higher of the assets’ net selling price and their value-in-use, which is measured

by reference to discounted future cash flow.

An impairment loss is charged to the statements of comprehensive income immediately

unless the asset is carried at its revalued amount. Any impairment loss of a revalued asset is

treated as a revaluation decrease to the extent of a previously recognised revaluation surplus

for the same asset.

In respect of assets other than goodwill, and when there is a change in the estimates used to

determine the recoverable amount, a subsequent increase in the recoverable amount of an

asset is treated as a reversal of the previous impairment loss and is recognised to the extent

of the carrying amount of the asset that would have been determined (net of amortisation and

depreciation) had no impairment loss been recognised. The reversal is recognised in the

statements of comprehensive income immediately, unless the asset is carried at its revalued

amount. A reversal of an impairment loss on a revalued asset is credited to other

comprehensive income. However, to the extent that an impairment loss on the same revalued

asset was previously recognised as an expense in the statements of comprehensive income, a

reversal of that impairment loss is recognised as income in the statements of comprehensive

income.

(i) Hire Purchase

Assets acquired under hire purchase arrangements are capitalised at their purchase cost and the

total instalments payable less undue interests under hire purchase agreements are recorded as

liabilities. The interests are allocated to the statements of comprehensive income over the year of

the respective agreements based on the remaining balance of liability for each period during the

hire purchase term. Assets acquired under hire purchase arrangements are depreciated over the

expected useful lives of equivalent owned assets.

(j) Provisions For Liabilities

Provisions for liabilities are recognised when the Group and the Company have a present legal or

constructive obligation as a result of past events, when it is probable that an outflow of resources

embodying economic benefits will be required to settle the obligation; and when a reliable estimate

of the amount can be made. Provisions are reviewed at each statements of financial postion date

and adjusted to reflect the current best estimate. Where the effect of the time value of money is

material, the amount of a provision is the present value of the expenditure expected to be required

to settle the obligation.


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38

(k) Contingent Liabilities

A contingent liability is a possible obligation that arises from past events and whose existence will

only be confirmed by the occurrence of one or more uncertain future events not wholly within the

control of the Group. It can also be a present obligation arising from past events that is not

recognised because it is not probable that an outflow of economic resources will be required or the

amount of obligation cannot be measured reliably.

A contingent liability is not recognised but is disclosed in the notes to the financial statements.

When a change in the probability of an outflow occurs so that the outflow is probable, it will then

be recognised as a provision.

(l) Related Parties

A party is related to an entity if:-

i. directly, or indirectly through one or more intermediaries, the party:-

a. controls, is controlled by, or is under common control with, the entity (this includes

parents, subsidiaries and fellow subsidiaries);

b. has an interest in the entity that gives it significant influence over the entity, or

c. has joint control over the entity;

ii. the party is an associate of the entity;

iii. the party is a joint venture in which the entity is a venture;

iv. the party is a member of the key management personnel of the entity or its parent;

v. the party is a close member of the family of any individual referred to in (i) or (iv);

vi. the party is an entity that is controlled, jointly controlled or significantly influenced by, or for

which significant voting power in such entity resides with, directly or indirectly, any

individual referred to in (iv) or (v); or

vii. the party is a post-employment benefit plan for the benefit of employees of the entity, or of

any entity that is a related party of the entity.

Close members of the family of an individual are those family members who may be expected to

influence, or be influenced by, that individual in their dealings with the entity.

(m) Foreign Currency Translation

i. Transactions And Balances

Foreign currency monetary assets and liabilities have been converted into Ringgit Malaysia

(“RM”) at the rates of exchange ruling at the statements of financial position date.

Transactions in foreign currencies have been converted at rates ruling at the transaction dates.

Exchange differences arising from the settlement of foreign currency transactions and from the

translation of foreign currency monetary assets and liabilities are included in the statements of

comprehensive income. Non-monetary assets and liabilities are translated using exchange

rates that existed when the values determined.


Annual Report 2012

39

ii. Foreign Operations

Assets and liabilities of foreign operations, including goodwill and fair value adjustments

arising from the acquisition of foreign operations, are translated into RM for consolidation at

the rates of exchange ruling at the end of the reporting period. Revenues and expenses of

foreign operations are translated into RM at the average rates for the financial period. All

exchanges differences arising from translation are recognised directly to other comprehensive

income and accumulated in equity under translation reserve. On disposal of a foreign

operation, accumulated translation differences recognised in other comprehensive income

relating to that particular foreign operation is reclassified from equity to comprehensive

income.

The principal closing foreign exchange rates used (expressed on the basis of one unit of

foreign currency to RM equivalent) for the translation of foreign currency balances at the end

of the reporting period were as follows:

2012 2011

RM

RM

United States Dollar 3.13 -

Hong Kong Dollar 0.40 -

(n) Revenue Recognition

Revenue comprises the fair value of the consideration received or receivable for the sale of goods

and services rendered in the ordinary course of the company’s activities. Revenue from sales of

goods and services is recognised upon delivery of goods and customers’ acceptance and where

applicable, net of returns and trade discounts, and services are performed.

(o) Interest Income

Interest on fixed deposits is recognised on an accrual basis.

(p) Income Tax Expense

Income taxes for the year comprise current and deferred tax.

Current tax is the expected amount of income taxes payable in respect of the taxable profit for the

year and is measured using the tax rates that have been enacted or substantively enacted at the end

of the reporting period.

Deferred tax is provided in full, using the liability method, on temporary differences arising

between the tax bases of assets and liabilities and their carrying amounts in the financial

statements.

Deferred tax liabilities are recognised for all taxable temporary differences other than those that

arise from goodwill or excess of the acquirer’s interest in the net fair value of the acquiree’s

identifiable assets, liabilities and contingent liabilities over the business combination costs or from

the initial recognition of an asset or liability in a transaction which is not a business combination

and at the time of the transaction, affects neither accounting profit nor taxable profit.

Deferred tax assets are recognised for all deductible temporary differences, unused tax losses and

unused tax credits to the extent that it is probable that taxable profit will be available against which

the deductible temporary differences, unused tax losses and unused tax credits can be utilised.


Annual Report 2012

40

Deferred tax assets and liabilities are measured at the tax rates that are expected to apply in the

period when the asset is realised or the liability is settled, based on the tax rates that have been

enacted or substantively enacted at the end of the reporting period.

Deferred tax is recognised in the statements of comprehensive income, except when it arises from a

transaction which is recognised directly in equity, in which case the deferred tax is also charged or

credited directly in equity, or when it arises from a business combination that is an acquisition, in

which case the deferred tax is included in the resulting goodwill or excess of the acquirer’s interest

in the net fair value of the acquiree’s identifiable assets, liabilities and contingent liabilities over the

business combination costs. The carrying amounts of deferred tax assets are reviewed at each end

of the 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 deferred tax assets to be utilised.

(q) Employee Benefits

i. Short Term Employee Benefits

Wages, salaries, paid annual leave, paid sick leave, bonuses and non-monetary benefits are

accrued in the period in which the associated services are rendered by employees of the

Group.

ii. Defined Contribution Plan

The Group’s contributions to defined contribution plans regulated and managed by the

government, are charged to the statements of comprehensive income in the period to which

they relate. Once the contributions have been paid, the Group has no further financial

obligations.

(r) Cash And Cash Equivalents

For the purposes of the statements of cash flows, cash and cash equivalents comprise cash in hand,

bank balances, bank overdrafts and short term, highly liquid investments that are readily

convertible to known amounts of cash and which are subject to an insignificant risk of changes in

value.

(s) Operating Segments

An operating segment is a component of the Group that engages in business activities from which it

may earn revenues and incur expenses, including revenues and expenses that relate to transactions

with any of the Group’s other components. An operating segment’s operating results are reviewed

regularly by the chief operating decision makers to make decisions about resources to be allocated

to the segment and to assess its performance, and for which discrete financial information is

available.


Annual Report 2012

41

4. CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS

Estimates and judgments are continually evaluated and are based on historical experience and other

factors, including expectations of future events that are believed to be reasonable under the

circumstances. The estimates and judgements that affect the application of the Group’s accounting

policies and disclosures, and have a significant risk of causing a material adjustment to the carrying

amounts of assets, liabilities, income and expenses are discussed below.

(a) Depreciation of Plant and Equipment

The estimates for residual values, useful lives and related depreciation charges for the property,

plant and equipment are based on commercial and production factors which could change

significantly as a result of technical innovations and competitors’ action in response to the market

conditions.

The Group anticipates that the residual values of its equipments will be insignificant. As a result,

residual values are not being taken into consideration for the computation of the depreciable

amount.

Changes in the expected level of usage and technological development could impact the economic

useful lives and the residual values of these assets, therefore future depreciation charges could be

revised.

(b) Income Taxes

There are certain transactions and computations for which the ultimate tax determination may be

different from the initial estimate. The Group recognises tax liabilities based on its understanding

of the prevailing tax laws and estimates of whether such taxes will be due in the ordinary course of

business. Where the final tax outcome of these matters is different from the amounts that were

initially recognised, such difference will impact the income tax and deferred tax provisions in the

period in which such determination is made.

(c) Impairment of Non-financial Assets

When the recoverable amount of an asset is determined based on the estimate of the value-in-use of

the cash-generating unit to which the asset is allocated, the management is required to make an

estimate of the expected future cash flows from the cash-generating unit and also to apply a

suitable discount rate in order to determine the present value of those cash flows.

(d) Impairment of Loans and Receivables

An impairment loss is recognised when there is objective evidence that a financial asset is

impaired. Management specifically reviews its loan and receivables financial assets and analyses

historical bad debts, customer concentrations, customer creditworthiness, current economic trends

and changes in the customer payment terms when making a judgement to evaluate the adequacy of

the allowance for impairment loss. 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. If the expectation is different from the estimation, such difference

will impact the carrying value of receivables.

(e) Write-down of Inventories

Reviews are made periodically by management on damaged, obsolete and slowing-moving

inventories. These reviews require judgement and estimates. Possible changes in these estimates

could result in revisions to the valuation of inventories.


Annual Report 2012

42

(f) Amortisation Of Development Expenditures

Changes in the expected level of usage could impact the economic useful lives, therefore future

amortisation charges could be revised.

(g) Impairment Of Goodwill

Goodwill is tested for impairment annually and at other times when such indicators exist. This

requires management to estimate the expected future cash flows of the cash-generating unit to

which goodwill is allocated and to apply a suitable discount rate in order to determine the present

value of those cash flows. The future cash flows are most sensitive to budgeted gross margins,

growth rates estimated and discount rate used. If the expectation is different from the estimation,

such difference will impact the carrying value of goodwill.

(h) Contingent Liabilities

The directors’ are of the opinion that provisions are not required in respect of the contingent

liabilities as it is not probable that a future sacrifice of economic benefit will be required.


Annual Report 2012

43

5. PROPERTY, PLANT AND EQUIPMENT

The details of property, plant and equipment are as follows:

Computers,

GSM tracking Furniture,

devices and fittings and Motor

servers equipment vehicles Renovation Total

Group RM RM RM RM RM

Cost

At 1 September 2011 6,068,862 179,360 93,143 113,206 6,454,571

Additions 8,462,073 41,055 46,920 112,494 8,662,542

Acquisition of a subsidiary - 12,394 2,068 - 14,462

Disposals - - (93,143) - (93,143)

Written off (3,760,210) (182,837) - (113,206) (4,056,253)

Currency translation differences 34,252 - - - 34,252

At 31 August 2012 10,804,977 49,972 48,988 112,494 11,016,431

Accumulated depreciation

At 1 September 2011 3,945,793 72,741 78,207 50,472 4,147,213

Charge for the year 1,784,221 20,682 13,212 30,887 1,849,002

Disposals - - (89,073) - (89,073)

Written off (3,524,299) (89,764) - (60,527) (3,674,590)

Currency translation differences 8,493 - - - 8,493

At 31 August 2012 2,214,208 3,659 2,346 20,832 2,241,045

Net book value

At 31 August 2012 8,590,769 46,313 46,642 91,662 8,775,386


Annual Report 2012

44

5. PROPERTY, PLANT AND EQUIPMENT (CONT’D)

The details of property, plant and equipment are as follows:

Computers,

GSM tracking Furniture,

devices and fittings and Motor

servers equipment vehicles Renovation Total

Company RM RM RM RM RMCostAt 1 September 2010 5,781,053 162,813 93,143 113,206 6,150,215 Additions 287,809 16,547 - - 304,356 At 31 August 2011 6,068,862 179,360 93,143 113,206 6,454,571 Additions 144 1,410 - - 1,554 Disposals - - (93,143) - (93,143) Written off (3,747,816) (180,770) - (113,206) (4,041,792)

At 31 August 2012 2,321,190 - - - 2,321,190

Accumulated depreciationAt 1 September 2010 3,421,186 56,582 59,578 40,418 3,577,764 Charge for the year 524,607 16,159 18,629 10,054 569,449

At 31 August 2011 3,945,793 72,741 78,207 50,472 4,147,213 Charge for the year 336,146 17,023 10,866 10,055 374,090 Disposals - - (89,073) - (89,073) Written off (3,524,299) (89,764) - (60,527) (3,674,590)

At 31 August 2012 757,640 - - - 757,640

Net book valueAt 31 August 2012 1,563,550 - - - 1,563,550

At 31 August 2011 2,123,069 106,619 14,936 62,734 2,307,358


Annual Report 2012

45

6. INTANGIBLE ASSETS

Development

Goodwill expenditures TotalGroup RM RM RM

Cost

At 1 September 2011 - 2,017,668 2,017,668

Additions 80,176 - 80,176

At 31 August 2012 80,176 2,017,668 2,097,844

Accumulated amortisation:

At 1 September 2011 - 1,735,069 1,735,069

Amortisation for the year - 140,435 140,435

At 31 August 2012 - 1,875,504 1,875,504

Carrying amount

At 31 August 2012 80,176 142,164 222,340

Company RM RM

Cost

At 1 September 2011/2010 2,017,668 1,985,835

Additions - 31,833

At 31 August 2012/2011 2,017,668 2,017,668

Accumulated amortisation:

At 1 September 2011/2010 1,735,069 1,583,621

Amortisation for the year 140,435 151,448

At 31 August 2012/2011 1,875,504 1,735,069

Carrying amount

At 31 August 2012/2011 142,164 282,599

Development expenditures

(a) Goodwill

(i) Allocation of goodwill

The goodwill was in relation to the acquisition of a subsidiary, PSCSB, during the financial year

which was also the Group’s cash generating unit (“CGU”) of the goodwill.


Annual Report 2012

46

(ii) Key assumptions used in value-in-use calculations

The recoverability of investment in CGU was assessed based on the net present value of its

future cash flows. In the calculation of net present value, the method on value-in-use was

adopted in which the expected future cash flows were discounted to the net present value with

the application of appropriate discounting rate. The key assumptions for the assessment of

future cash flows, the discounting rate used in the calculation of the net present value and the

basis of adoption were as follows:

Gross profit margin 25%

Average annual growth rate for revenue 20%

Discount rate 7%

(iii) Sensitivity to changes in assumptions

The management believed that any reasonably possible changes in the above key assumptions

applied will not cause the carrying values of the unit to materially exceed its recoverable

amounts.

(b) Development expenditures

Development expenditures consist of GPS tracking system.

7. INVESTMENTS IN SUBSIDIARY COMPANIES

2012 2011RM RM

Unquoted shares, at cost 200,005 -

Company

Details of the subsidiary companies are as follows:

Name of subsidiary companies

Effective equity interest

Principal activities 2012 2011

% %

Incorporated in Malaysia

Nautical Angle Sdn. Bhd. 100 - Provision for cloud computing

and management services.

Imagine Data Sdn. Bhd.

100

-

Investment holding.

Pioneer Streams Consolidated

Sdn. Bhd.

100

-

Provision for fleet management

and GPS tracking system.

Incorporated in Hong Kong

Starvista Limited*

100

-

Provision for hosting services.

King Arts Limited*

100

-

Dormant.

* Not audited by Siew Boon Yeong & Associates.


Annual Report 2012

47

8. INVENTORIES

Group

2012 2012 2011

RM RM RM

Cost

Finished goods 22,406 - 1,046,113

Company

None of the inventories is carried at net realisable value.

9. TRADE RECEIVABLES

The Group’s and Company’s normal trade credit terms ranged from 30 to 90 days. Other credit terms are

assessed and approved on a case-by-case basis.

Included in the trade receivables in the previous financial year was an amount of RM5,642 owing by a

company in which certain directors have an interest.

10. OTHER RECEIVABLES, DEPOSITS AND PREPAYMENTS

Group

2012 2012 2011

RM RM RM

Other receivables 215,996 39,994 5,499

Deposits 140,282 - 23,127

Prepayments 20,535 - 140,941

376,813 39,994 169,567

Company

11. AMOUNTS OWING BY SUBSIDIARY COMPANIES

Company

The amounts owing are non-trade in nature, unsecured, interest-free and repayable on demand and are to

be settled in cash.

12. FIXED DEPOSITS WITH LICENSED BANKS

Group and Company

Fixed deposits with licensed banks of the Group and of the Company amounting to RM211,250 (2011:

Nil) have been pledged to the banks for credit facilities granted to the Group and the Company.


Annual Report 2012

48

13. SHARE CAPITAL

2012 2011 2012 2011

RM RM

Ordinary shares of RM0.10 each:

Authorised: 100,000,000 100,000,000 10,000,000 10,000,000

Issued and fully paid: 100,000,000 100,000,000 10,000,000 10,000,000

Group and Company

Number of shares

14. SHARE PREMIUM

Group and Company

The share premium is distributable by way of dividends and may be utilised in the manner as set out in

Section 60(3) of the Companies Act, 1965 in Malaysia.

15. FOREIGN EXCHANGE TRANSLATION RESERVE

Group

The foreign exchange fluctuation reserve arose from the translation of the financial statements of a foreign

subsidiary and is not distributable by way of dividends.

16. AMOUNT OWING TO A SHAREHOLDER

2012 2011

RM RM

Current liabilities 3,764,709 -

Non-current liabilities 1,500,000 -

5,264,709 -

Group

During the year, the Group received advances from a shareholder. The advances were utilised for the

purchase of servers. The amount is interest-free and unsecured.

Advances classified as non-current liabilities amounting to RM1,500,000 is repayable one year after 31

August 2012 and the shareholder has confirmed that he will not seek repayment of the amount of

RM1,500,000 at least 12 months from the date of approval of these financial statements, and only when

the Group has sufficient available funds.


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49

17. TRADE PAYABLES

Group and Company

The normal trade credit terms granted to the Group and the Company ranged from 30 to 90 days. Other

credit terms are assessed and approved on a case-by-case basis.

18. OTHER PAYABLES AND ACCRUALS

Group

2012 2012 2011

RM RM RM

Other payables 455,018 430,007 290,935

Accruals 70,349 50,004 98,549

525,367 480,011 389,484

Company

19. HIRE PURCHASE PAYABLES

The hire purchase payables are repayable as follows:

Future

instalments

payable Undue interest

Principal

payable

Group/Company RM RM RM

2012 - - -

Company

2011

Shown under current liabilities

Within 1 year 4,739 (89) 4,650

Shown under non-current liabilities

Between 2 to 5 years - - -

4,739 (89) 4,650

The effective interest rate for hire purchase creditors is 7.24% (2011: 7.24%) per annum.


Annual Report 2012

50

20. REVENUE

Group and Company

Revenue represents the invoiced value of goods sold and services rendered, less discounts and returns,

where applicable.

21. FINANCE COSTS

Group

2012 2012 2011

RM RM RM

Hire purchase interest 89 89 966

Company

22. PROFIT BEFORE TAXATION

Group

2012 2012 2011

RM RM RM

Profit before taxation is stated

after charging :

Amortisation of development expenditures 140,435 140,435 151,448

Auditors' remuneration

- current year's provision 29,000 24,000 6,000

- over provision in respect of prior year - - (500)

Depreciation 1,849,002 374,090 569,449

Loss on foreign exchange - realised 58,434 11,159 -


written off 381,663 367,202 -

Rental of equipment 21,600 21,600 43,200

Rental of premises 214,102 26,700 49,600

Staff costs (Note 23) 1,469,437 553,530 1,840,891

Write-down of inventories 600,000 600,000 -

and crediting:

Gain on disposal of property, plant

and equipment (59,930) (59,930) -

Gain on foreign exchange - unrealised (77,840) (71,696) -

Interest income (12,902) (11,595) (36,011)

Company


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51

23. STAFF COSTS

The staff costs recognised in the statements of comprehensive income are as follows:

Group

2012 2012 2011

RM RM RM

Salaries and wages 1,179,919 385,330 1,626,892

Defined contribution plans 83,720 25,070 112,026

Other employee benefits 205,798 143,130 101,973

1,469,437 553,530 1,840,891

Included in staff costs are:

Directors' remuneration:

- fees 128,491 74,491 7,200

- other emoluments 96,841 55,517 96,200

Company


Annual Report 2012

52

24. INCOME TAX EXPENSE

Group2012 2012 2011RM RM RM

Malaysian income tax:

- current year's provision - - -

Company

A reconciliation of income tax expense applicable to profit before taxation at the statutory income tax rate

to income tax expense at the effective income tax rate is as follows:

Group2012 2012 2011RM RM RM

Profit before taxation 1,951,396 2,174,306 122,943

Income tax expense at

Malaysian statutory tax rate of

of 25% (2011: 25%) 487,849 543,577 30,736

• Adjustments for the following

tax effects:

- expenses not deductible for

tax purposes 352,707 302,702 46,996

- income not subject to tax (35,279) (35,279) -

- deferred tax assets not

recognised during the year 5,723 - -

- utilisation of deferred tax

assets not recognised in

prior years (811,000) (811,000) (77,732)

(487,849) (543,577) (30,736)

- - -

Company

The amounts of temporary differences for which no deferred tax assets have been recognised in the

statements of financial positions are as follows:

Group

2012 2012 2011

RM RM RM

Excess of capital allowances claimed over

corresponding accumulated depreciation (8,634,278) (1,563,549) (2,164,020)

Unutilised capital allowances 7,140,533 55,817 4,028,662

Unabsorbed tax losses 1,897,809 1,879,561 1,879,561

404,064 371,829 3,744,203

Company

Deferred tax assets have not been recognised in respect of these items as it is not probable that future

taxable profits will be available against which the above deductible temporary differences can be utilised.


Annual Report 2012

53

25. EARNINGS PER SHARE

The basic earnings per share as at 31 August 2012 is arrived at by dividing the Group’s profit attributable

to the owners of the Company of RM1,951,396 (2011: Company’s profit attributable to the owners of the

Company of RM122,943) for the financial year divided by weighted average number of ordinary shares in

issue during the financial year of 100,000,000 (2011: 100,000,000)

The fully diluted earnings per share for the Group is not presented as there were no dilutive potential

ordinary shares outstanding at the end of the reporting year.

26. ACQUISITION OF SUBSIDIARY COMPANIES

During the financial year, the Group acquired the following subsidiaries:

(i) On 8 March 2012, the Company acquired the entire issued and paid-up share capital of King Arts

Limited, a dormant company incorporated in Hong Kong, representing 1 ordinary share for a total

consideration of Hong Kong Dollar 1.

(ii) On 16 July 2012, the Company acquired the entire issued and paid-up share capital of Pioneer

Streams Consolidated Sdn. Bhd., a company incorporated in Malaysia, representing 100,000


The fair value of the identifiable assets and liabilities of the subsidiary companies acquired as at the dates

of acquisition were:-

Carrying Fair value

amount recognised

RM RM

Property, plant and equipment 14,462 14,462

Deposit paid 3,600 3,600

Cash and bank balances 101,762 101,762

Total identifiable net assets 119,824 119,824

Goodwill on acquisition 80,176

Total purchase consideration 200,000

Less: Cash and bank balances of subsidiaries acquired (101,762)

Net cash outflow for acquisition of subsidiary companies 98,238

At dates of acquisition

The acquired subsidiaries have contributed a loss after taxation amounting to RM26,557 to the results of

the Group.

If the acquisition had taken place at the beginning of the financial year, the Group’s loss after taxation

would have been RM6,733.


Annual Report 2012

54

27. RELATED PARTY DISCLOSURE

(a) Identities of related parties

(i) The Group has a controlling related party relationship with its direct subsidiaries as disclosed

in Note 7 to the financial statements; and

(ii) The Executive Directors who are the key management personnel.

(b) In addition to the transactions detailed elsewhere in the financial statements, the Group and the

Company carried out the following significant transactions with the related parties during the

financial year:-

(i) Subsidiary company

2012 2011

RM RM

Management fee paid/payable to a -

subsidiary company 235,072 -

Company

(ii) Key management compensation

Group

2012 2012 2011

RM RM RM

Short term employee benefits

- Salaries and wages 42,000 42,000 92,700

- Defined contribution plans 5,040 5,040 3,500

- Others 178,292 82,968 7,200

Company

28. FINANCIAL INSTRUMENTS

The Group’s activities are exposed to a variety of market risks (including foreign currency risk, interest

rate risk and price risk), credit risk and liquidity risk. The Group’s overall financial risk management

policy focuses on the unpredictability of financial markets and seeks to minimise potential adverse effects

on the Group’s financial performance.

(a) Financial Risk Management Policies

The Group’s policies in respect of the major areas of treasury activity are as follows:-

(i) Market Risk

(i) Foreign Currency Risk

The Group and the Company is exposed to foreign currency risk on transactions and

balances that are denominated in currencies other than RM. Foreign currency risk is

monitored closely on an ongoing basis to ensure that the net exposure is at an acceptable

level.


Annual Report 2012

55

The net unhedged financial assets of the Group and of the Company not denominated in

RM are as follows:-

Hong Kong United States

Dollar Dollar Total

Group RM RM RM

2012

Trade and other receivables 1,330,550 718,566 2,049,116

Amount owing to a shareholder - (5,264,709) (5,264,709)

Trade and other payables (405,667) - (405,667)

Cash and bank balances 1,147,386 425,419 1,572,805

Currency exposure 2,072,269 (4,120,724) (2,048,455)

Company

2012

Trade and other receivables 1,157,148 - 1,157,148

Amounts owing by subsidiary

companies 3,629,704 626,300 4,256,004

Cash and bank balances 2,843 - 2,843

Currency exposure 4,789,695 626,300 5,415,995

The Company had no foreign currency exposure for the financial year ended 31 August 2011.


Annual Report 2012

56

Foreign Currency Risk Sensivity Analysis

The following table details the sensitivity analysis to a reasonably possible change in the

foreign currencies as at the end of the reporting period, with all other variables held

constant:-

Group

2012 2012 2011

RM RM RM

Increase/ Increase/ Increase/

(Decrease) (Decrease) (Decrease)

Effects on profit after taxation/

equity

Strengthened by 10%

- Hong Kong Dollar 207,227 480,303 -

- United States Dollar (412,072) 62,630 -

Weakened by 10%

- Hong Kong Dollar (207,227) (480,303) -

- United States Dollar 412,072 (62,630) -

Company

(ii) Interest Rate Risk

The Group’s and Company’s exposure to interest rate risk arises mainly from hire

purchase. Its policy is to obtain the most favourable interest rates available.

Interest Rate Risk Sensitivity Analysis The Group is not exposed to interest rate risk as the interest-bearing financial instruments

carry fixed interest rate and are measured at amortised cost.

(iii) Equity Price Risk

The Group does not have any quoted investments and hence is not exposed to price risk.

(ii) Credit Risk

The Group’s exposure to credit risk, or the risk of counterparties defaulting, arises mainly

from receivables. The maximum exposure to credit risk is represented by the carrying amount

of this financial asset in the statements of financial position reduced by the effects of any

netting arrangements with counterparties.


Annual Report 2012

57

The Group establishes an allowance for impairment that represents its estimate of incurred

losses in respect of the trade and other receivables as appropriate. The main components of

this allowance are a specific loss component that relates to individually significant exposures,

and a collective loss component established for groups of similar assets in respect of losses

that have been incurred but not yet identified. Impairment is estimated by management based

on prior experience and the current economic environment.

Credit risk concentration profile

The Group’s major concentration of credit risk relates to the amounts owing by four customers

which constituted 100% of the outstanding trade receivables of the Group at the reporting date.

Exposure to credit risk

As the Group does not hold any collateral, the maximum exposure to credit risk is represented

by the carrying amount of the financial assets at the reporting date.

Ageing analysis

The ageing analysis of the Group’s and the Company’s trade receivables at the reporting date

is as follows:-

Group

2012 2012 2011

RM RM RM

Not past due 1,203,148 609,550 297,526

Due past

- less than 3 months 672,566 547,598 683,823

- within 3 to 6 months - - 722,670

1,875,714 1,157,148 1,704,019

Company

Trade receivables of the Group and the Company that are past due but not impaired are

unsecured in nature. They are creditworthy receivables.


Annual Report 2012

58

(iii) Liquidity and Cash Flow Risk

The Group’s exposure to liquidity and cash flow risks arises mainly from general funding and

business activities.

The following table sets out the maturity profile of the financial liabilities as at the end of the

reporting period based on contractual undiscounted cash flows (including interest payments

computed using contractual rates or, if floating, based on the rates at the end of the reporting

period):-

Weighted

Group Average Contractual

Effective Carrying Undiscounted Within 1 - 2 2 - 5 Over

Rate Amount Cash Flows 1 year years years 5 years

2012 % RM RM RM RM RM RM

Trade payables - 403,654 403,654 403,654 - - -

Other payables

and accruals - 525,367 525,367 525,367 - - -

Amount owing to -

a shareholder - 5,264,709 5,264,709 3,764,709 1,500,000 - -

6,193,730 6,193,730 4,693,730 1,500,000 - -

Weighted

Company Average Contractual




Other payables

and accruals - 480,011 480,011 480,011 - - -

Weighted

Company Average Contractual




Trade payables - 13,367 13,367 13,367 - - -

Other payables

and accruals - 389,484 389,484 389,484 - - -

Hire purchase

payables 7.24 4,650 4,739 4,739 - - -

407,501 407,590 407,590 - - -


Annual Report 2012

59

(b) Capital Risk Management

The Group manages its capital to ensure that the Group will be able to maintain an optimal capital

structure so as to support their businesses and maximise shareholders’ value. To achieve this

objective, the Group may make adjustments to the capital structure in view of changes in economic

conditions, such as adjusting the amount of dividend payment, returning of capital to shareholders or

issuing new shares.

The Group manages its capital based on debt-to-equity ratio. The debt-to-equity ratio is calculated as

net debt divided by total capital. Net debt is calculated as borrowings plus trade and other payables

less cash and cash equivalents.

The debt-to-equity ratio of the Group as at the reporting date is 0.34.

Group

2012

RM

Trade payables 403,654

Other payables and accruals 525,367

Amount owing to a shareholder 5,264,709

6,193,730

Less: Fixed deposits with licensed banks (361,250)

Less: Cash and bank balances (2,984,957)

Net debt 2,847,523

Total equity 8,425,136

Debt-to-equity ratio 0.34


Annual Report 2012

60

(c) Classification Of Financial Instruments

Group

2012 2012 2011

RM RM RM

Financial assets

Loan and receivables financial assets

Trade receivables 1,875,714 1,157,148 1,704,019

Other receivables, deposits

and prepayments 376,813 39,994 169,567

Amounts owing by

subsidiary companies - 4,582,080 -

Fixed deposits with

licensed banks 361,250 211,250 1,291,576


5,598,734 7,218,642 3,241,475

Financial liabilities

Other financial liabilities

Trade payables 403,654 - 13,367

Other payables and accruals 525,367 480,011 389,484

Amount owing to a shareholder 5,264,709 - -

Hire purchase payables - - 4,650

6,193,730 480,011 407,501

Company

(d) Fair Values Of Financial Instruments

The carrying amounts of the financial assets and financial liabilities reported in the financial

statements approximated their fair values.

Fair value estimates are made at a specific point in time and based on relevant market information

and information about the financial instruments. These estimates are subjective in nature, involve

uncertainties and matters of significant judgment and therefore cannot be determined with precision.

Changes in assumptions could significantly affect the estimates.

`

(e) Fair value hierarchy

As at 31 August 2012, there were no financial instruments measured at fair value in the statements of

financial position.


Annual Report 2012

61

29. OPERATING SEGMENTS

Operating segments are prepared in a manner consistent with the internal reporting provided to the

Executive Directors as its chief operating decision makers in order to allocate resources to segments and

to assess their performance. For management purposes, the Group is organised into business units based

on their products and services provided.

The Group is organised into main business segments as follows:-

(i) Tracking solutions

Developing and operating an internet based automatic vehicle locating system

using satellite and wireless tele-communication solutions.

(ii) Hosting services

The hosting services segment commenced operation during the year and it is in the

business of provision of internet hosting services to internet content providers.

Other segments comprise companies providing management services and dormant companies.

The Executive Directors assess the performance of the operating segments based on operating profits or

losses which is measured differently from those disclosed in the consolidated financial statements.

The Executive Directors are of the opinion that all inter segment transactions are entered into in the

normal course of business and are at arm’s length basis in a manner similar to transactions with third

parties.


Annual Report 2012

62

Business segments

Tracking Hosting

Group solutions services Others Total

2012 RM RM RM RM

Revenue

External revenue 5,762,420 6,902,171 240,000 12,904,591

Inter-segment elimination - - (240,000) (240,000)

External revenue 5,762,420 6,902,171 - 12,664,591

Results

Segment results 2,343,874 (4,653) (400,638) 1,938,583

Interest income 11,594 9 1,299 12,902

Interest expenses (89) - - (89)

Profit before taxation 2,355,379 (4,644) (399,339) 1,951,396

Income tax expense - - - -

Profit after taxation 2,355,379 (4,644) (399,339) 1,951,396

Segment assets 4,342,276 9,080,824 1,195,766 14,618,866

Segment liabilities 493,342 5,699,189 1,199 6,193,730

Other information

Capital expenditures 1,554 8,458,628 202,360 8,662,542

Gain on foreign exchange -

unrealised (71,696) (6,144) - (77,840)

Gain on disposal of property,

plant and equipment (59,930) - - (59,930)

Depreciation of property,

plant and equipment 374,090 1,447,432 27,480 1,849,002

Amortisation of development

expenditures 140,435 - - 140,435


written off 381,663 - - 381,663

Write-down of inventories 600,000 - - 600,000


Annual Report 2012

63

Geographical information

Non-current

Revenue assets

Group RM RM

2012

Malaysia 725,017 1,960,769

Hong Kong 11,939,574 -

United States of America - 7,036,957

12,664,591 8,997,726

Major Customers

No segmental disclosure for the financial year ended 31 August 2011 as the Company was principally

engaged in the business of tracking solutions, which was substantially within a single business segment.

The Company operates primarily in Malaysia.

Information about major customers

Group

Revenue

No. of

Customers %*

2012

RM

Provision of hosting services to internet

service providers in Hong Kong 3 54.5 6,902,171

Provision of tracking solution

in Hong Kong 1 39.8 5,037,403

Note: *- Computed based on revenue from major customers by business segments over total revenue.

30. SIGNIFICANT EVENTS DURING THE FINANCIAL YEAR

(i) On 6 September 2011, the Company incorporated two wholly-owned subsidiaries in Malaysia

under the names of Imagine Data Sdn. Bhd. (“IDSB”) and Nautical Angle Sdn. Bhd. (“NASB”).

The issued and paid-up share capital of IDSB and NASB are 2 ordinary shares of RM1 each,

respectively.

(ii) On 8 March 2012, the Company acquired the entire issued and paid-up share capital of King Arts

Limited, a company incorporated in Hong Kong, representing 1 ordinary share for a total

consideration of Hong Kong Dollar 1.

(iii) On 16 July 2012, the Company acquired the entire issued and paid-up share capital of Pioneer

Streams Consolidated Sdn. Bhd., a company incorporated in Malaysia, representing 100,000



Annual Report 2012

64

31. SUPPLEMENTARY INFORMATION – BREAKDOWN OF ACCUMULATED LOSSES INTO

REALISED AND UNREALISED

The breakdown of the accumulated losses of the Group and the Company at end of reporting period into

realised and unrealised losses is presented in accordance with the directive issued by Bursa Malaysia

Securities Berhad dated 25 March 2010 and prepared 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.

Group

2012 2012 2011

RM RM RM

Total accumulated losses of

the Group and the Company

- Realised (3,688,470) (3,459,416) (5,562,026)

- Unrealised 77,840 71,696 -

Accumulated losses of

the Group and the Company (3,610,630) (3,387,720) (5,562,026)

Company

32. AUTHORISATION FOR ISSUE OF FINANCIAL STATEMENTS

These financial statements were authorised for issue on 27 December 2012 by the Board of Directors.


Annual Report 2012

65

Analysis of Shareholdings as at 18 January 2013

Share Capital Authorised Share Capital : RM10,000,000

Issued and Fully Paid-up Capital : RM10,000,000

Class of Shares : Ordinary Shares of RM0.10 each

Voting Rights : One vote per shareholder on a show of hands

: One vote per share on a poll

Size of Shareholdings

Size of Shareholdings No .of

Shareholders

% of

Shareholders No. of Shares

% of Issued

Share Capital

Less than 100 shares 5 0.24 203 0.00

100-1,000 shares 133 6.35 91,947 0.09

1,001-10,000 shares 821 39.17 5,465,950 5.47

10,001-100,000 shares 998 47.61 36,850,600 36.85

100,001 to less than 5%

of Issued shares 138 6.58 47,901,800 47.90

5% and above of issued

shares 1 0.05 9,689,500 9.69

Total 2,096 100 100,000,000 100

List of Substantial Shareholders as at 18 January 2013

Name of Substantial Shareholders No. of Shares Percentage (%)

Fong Shu Cheung 9,689,500 9.69

Statement of Directors’ Interest in Shares as at 18 January 2013

Name

Cybertowers Berhad

Direct Interest Indirect Interest

No. of Shares % No. of Shares %

Lai Ka Wai - - - -

Yuen Chun Fai - - - -

Lee Chee Cheng - - - -

Lee Choong Kin - - - -

Chua Hwa Nian - - - -


Annual Report 2012

66

List of 30 Largest Shareholders as at 18 January 2013

No. Name of Shareholders No. of Shares Percentage

1. Fong Shu Cheung 9,689,500 9.69

2. Foo Choon Tow 3,231,400 3.23

3. Public Nominees (Tempatan) Sdn. Bhd. 2,020,000 2.02

4. Nor Ashikin Binti Khamis 1,982,300 1.98

5. Kuasatek (M) Sdn Bhd 1,500,000 1.50

6. Abu Hassan Bin Hashim 1,465,000 1.47

7. Chew Weng Choy 1,400,000 1.40

8. Lim Jim Yee 1,350,000 1.35

9. Reill Edward Champley 1,335,800 1.34

10. Koh Kim Boon 1,076,900 1.08

11.

Alliance Group Nominees ( Tempatan) Sdn

Bhd Pledged Securities Account For Sho Boon

Chin

1,000,000 1.00

12. Chong Wang Leong 1,000,000 1.00

13 SJ Sec Nominees (Tempatan) Sdn Bhd Pledged

Securities Account For Francis Ho Ik Sing 970,200 0.97

14. Tan Kok Hong 900,000 0.90

15. Tan Teong Heng 775,000 0.78

16. Public Nominees (Tempatan) Sdn Bhd Pledged

Securities Account For Lee Jun Foh 720,000 0.72

17. Public Nominees (Tempatan) Sdn Bhd Pledged

Securities Account For Tan Geok Heong 700,000 0.70

18. TA Nominees (Tempatan) Sdn Bhd Pledged

Securities Account For Lim Hock Sing 700,000 0.70

19. Liew Kee Huat 690,000 0.69

20. Rolni Chuah Hock Soon 635,000 0.64

21. Twin Ocean Investment Limited 570,000 0.57

22. Maybank Nominees (Tempatan) Sdn Bhd

Pledged Securities Account For Lee Sia You 507,000 0.51


Annual Report 2012

67

List of 30 Largest Shareholders as at 18 January 2013

23. Alliance Group Nominees (Tempatan) Sdn Bhd

Chua Keng Liang 500,000 0.50

24. Soo Wing Ching 500,000 0.50

25. Chin Kueh Fah 430,000 0.43

26. Chong Chee Kiang 400,000 0.40

27. Hee Lin Ruey Jean 400,000 0.40

28. Tay Keng Chong 400,000 0.40

29. Yee Boon Hong 400,000 0.40

30.

Maybank Nominees (Tempatan) Sdn Bhd

Pledged Securities Account For Mohammad

Zuhannes Bin Dzulkifli

383,700 0.38


Annual Report 2012

68

NOTICE OF ANNUAL GENERAL MEETING

NOTICE IS HEREBY GIVEN that the Sixteenth Annual General Meeting of the Company will be held at

Hotel Sri Petaling, 30, Jalan Radin Anum, Bandar Baru Sri Petaling, 57000 Kuala Lumpur on Thursday, 28

February 2013 at 10.00 a.m. for the following purposes:-

AGENDA As Ordinary Business

1. To receive the Audited Financial Statements for the financial year ended 31 August 2012 together with the

Reports of the Directors and Auditors thereon. (Resolution 1)

2. To approve the payment of directors’ fees amounting to RM 128,491 in respect of financial year ended 31

August 2012. (Resolution 2)

3. To re-elect the following as Directors pursuant to the Company’s Articles of Association:

3.1 Mr. Lee Chee Cheng (Article 83) (Resolution 3)

3.2 Mr. Lee Choong Kin (Article 90) (Resolution 4)

3.3 Mr. Chua Hwa Nian (Article 90) (Resolution 5)

3.4 Mr. Yuen Chun Fai (Article 90) (Resolution 6)

4. To re-appoint Messrs Siew Boon Yeong & Associates as Auditors of the Company and to authorise the

Directors to fix their remuneration. (Resolution 7)

As Special Business

5. To consider and, if thought fit, pass the following resolution: (Resolution 8)

Authority to allot shares pursuant to Section 132D of the Companies Act, 1965

“THAT pursuant to Section 132D of the Companies Act, 1965, the Directors be and be hereby empowered

to allot and issue shares in the Company, at any time, at such price, until the conclusion of the next Annual

General Meeting and upon such terms and conditions and for such purposes as the Directors may, in their

absolute discretion, deem fit, provided that the aggregate number of shares does not exceed 10% of the

issued share capital of the Company at the time of issue and THAT the Directors be and are also

empowered to obtain the approval for the listing of and quotation for the additional shares so issued,

subject to the Companies Act, 1965, the Articles of Association of the Company and approval from the

Bursa Malaysia Securities Berhad and other relevant bodies where such approval is necessary.”

On Behalf Of The Board

Jauhari Bin Hassan (LS 03681)

Secretary

6 February 2013


Annual Report 2012

69

Notes:

1. A member entitled to attend and vote at the meeting is entitled to appoint one (1) or more proxies (or in the

case of a corporation, a duly authorized representative) to attend and vote in his/her stead. A proxy may

but need not to be a member of the Company and the provision of Sections 149(a) and (b) of the

Companies Act, 1965 shall not apply to the Company.

2. A member may appoint two (2) or more proxies to attend and vote at the same meeting, such appointment

shall invalid unless the member specifies the proportion of his/her shareholdings to be represented by each

proxy.

3. A member who is an authorized nominee as defined under the Securities Industry (Central Depositor) Act,

1991 may appoint one (1) proxy in respect of each securities account.

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

authorized in writing or if such appointer is a corporation, it must be under its seal or under the hand of

an officer or attorney duly authorised.

5. The instrument appointing a proxy must be deposited at the Registered Office of the Company, Ground

Floor, 8, Lorong University B, Section 16, 46350 Petaling Jaya, Selangor Darul Ehsan not less than forty-

eight (48) hours before the time for holding the meeting or any adjournment thereof.

EXPLANATORY NOTE ON THE SPECIAL BUSINESS

Resolution 8 – Authority to allot shares pursuant to Section 132D of the Companies Act, 1965

The proposed Resolution 8, if passed, will empower the Directors of the Company, from the date of the Annual

General Meeting, to issue shares (other than bonus or rights issue) of the Company up to and not exceeding in

total 10% of the issued share capital of the Company at the time of issue for such purpose as they considered

would be in the best interest of the Company. This authority, unless revoked or varied at a general meeting,

will expire at the next Annual General Meeting of the Company.

As at the date of this Notice, no new shares of the Company were issued pursuant to the mandate granted to the

Directors of the Company at the Fifteenth Annual General Meeting held on 28 February 2012.

The new mandate will provide flexibility to the Company to issue new shares without the need to convene a

separate general meeting to obtain shareholders’ approval so as to avoid incurring additional cost and time.

The purpose of this general mandate is for any possible fund raising activities, including but not limited to

further placement of shares for purpose of funding current and/or future investment projects, working capital

and/or acquisitions.


Annual Report 2012

70

Statement Accompanying

Notice of Annual General Meeting

1. Directors who are standing for re-election at the Sixteenth Annual General Meeting of Cybertowers

Berhad are:

1.1 Mr. Lee Chee Cheng (Article 83)

1.2 Mr. Lee Choong Kin (Article 90)

1.3 Mr. Chua Hwa Nian (Article 90)

1.4 Mr. Yuen Chun Fai (Article 90)

The aforesaid Directors’ shareholdings is set out on page 61 of this Annual Report. Further details of the

Directors are set out in the Profile of the Board of Directors on page 5 to page 7 of this Annual Report.

2. Date, time and place of the Sixteenth Annual General Meeting

The Sixteenth Annual General Meeting of Cybertowers Berhad will be held at Hotel Sri Petaling, 30, Jalan

Radin Anum, Bandar Baru Sri Petaling, 57000 Kuala Lumpur on Thursday, 28 February 2013 at 10.00 a.m.

3. Attendance of Board of Directors’ Meetings

Eight (8) Board meetings were held during the financial year from 1 September 2011 to 31 August 2012.

Details of attendance of Directors at Board meetings are as follows:-

Name

Designation

Number of

meetings held

Number of

meetings

attended

Wong Kek Wei

(Resigned on 22.6.2012) Managing director 6 6

Wong Chook Ping

(Resigned on 3.4.2012) Non-Executive Chairman 5 3

Por Yew Guan

(Resigned on 20.4.2012) Independent Non-Executive Director 5 3

Lee Chee Cheng Independent Non-Executive Director 8 8

Lai Ka Wai Executive Director 8 5

Lee Choong Kin

(Appointed on 3.4.2012) Independent Non-Executive Director 3 3

Chua Hwa Nian

(Appointed on 20.4.2012) Independent Non-Executive Director 3 3

Yuen Chun Fai

(Appointed on 25.4.2012) Executive Director 2 2


Annual Report 2012

71

PROXY FORM

I/We______________________________________________________________________________________________ (FULL NAME IN BLOCK LETTERS)

of_______________________________________________________________________________________________ (FULL ADDRESS)

being a member of CYBERTOWERS BERHAD, hereby appoint

________________________________________________________________________________________________ (FULL NAME)

of _____________________________________________________________________________________________ (FULL ADDRESS)

or failing him/her, the CHAIRMAN OF THE MEETING as my/our proxy to attend and vote for me/us and on my/our behalf at the

Sixteenth Annual General Meeting of the Company to be held at Hotel Sri Petaling, 30, Jalan Radin Anum, Bandar Baru Sri Petaling,

57000 Kuala Lumpur on Thursday, 28 February 2013 at 10.00 a.m. or at any adjournment thereof. My/our proxy is to vote as indicated

below:-

Resolution For Against

Resolution 1 To receive the Audited Financial Statements for the financial year ended

31 August 2012 together with the Reports of the Directors and Auditors

thereon.

Resolution 2 To approve the payment of directors’ fees amounting to RM 128,491 in

respect of financial year ended 31 August 2012.

Resolution 3

Resolution 4

Resolution 5

Resolution 6

To re-elect the following as Directors pursuant to the Company’s Articles

of Association:

Mr. Lee Chee Cheng (Article 83)

Mr. Lee Choong Kin (Article 90)

Mr. Chua Hwa Nian (Article 90)

Mr. Yuen Chun Fai (Article 90)

Resolution 7 To re-appoint Messrs. Siew Boon Yeong & Associates as Auditors of the

Company and to authorize the Directors to fix their remuneration.

Resolution 8 Authority to allot shares pursuant to Section 132D of the Companies Act,

1965.

(Please indicate with an “X” in the appropriate box against each Resolution how you wish your proxy to vote. If no instruction is

given, this form will be taken to authorise the proxy to vote at his/her discretion).

Signed this___________ day of __________________2013

Number of shares held

_________________________________

Signature of Shareholder or Common Seal

NOTES:-

1. A member entitled to attend and vote at the meeting is entitled to appoint one (1) or more proxies (or in the case of a

corporation, a duly authorised representative) to attend and vote in his/her stead. A proxy may but need not to be a member of

the Company and the provision of Sections 149(a) and (b) of the Companies Act, 1965 shall not apply to the Company. 2. A member may appoint two (2) or more proxies to attend and vote at the same meeting, such appointment shall be invalid

unless the member specifies the proportion of his/her shareholdings to be represented by each proxy.

3. A member who is an authorised nominee as defined under the Securities Industry (Central Depositor) Act, 1991 may appoint one (1) proxy in respect of each securities account.

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

if such appointer is a corporation, it must be under its seal or under the hand of an officer or attorney duly authorised 5. The instrument appointing a proxy must be deposited at the Registered Office of the Company, Ground Floor, 8, Lorong

Universiti B, Section 16, 46350 Petaling Jaya, Selangor Darul Ehsan not less than forty-eight (48) hours before the time for

holding the meeting or any adjournment thereof.


Annual Report 2012

72

Please fold here

Affix

Stamp

To: Here

The Company Secretary


Ground Floor, 8, Lorong Universiti B,

Section 16, 46350 Petaling Jaya,

Selangor Darul Ehsan,

Malaysia.

Please fold here

cybert-annualreport2012 (1.6mb)

Documents

directors report

v annual report

lee chee cheng member

executive chairman

lee chee cheng independent

audit committee report

financial year

chua hwa nian independent