forever brighter and greener · corporate profile jk yaming international holdings ltd. was...

foreverBrighter and Greener

www.jkyaming.com

Mission

Emerging from a general manufacturer to an highly engineering value added producer of lighting products with world class research and development capacity in the design and manufacturing of environmental friendly ,energy saving electrical lighting products—Induction lamps.

Our research institute located at Fuzhou is equipped with the most advanced equipments and we work together with high caliber post doctorates from top universities.

We will continue to share these engineering values created by us with our customers, business associates, our shareholders and to contribute in meaningful ways towards the highly demanded, imminent global needs for energy saving and greener living environment.

Contents

Corporate Profi le 01Chairman’s Statement 02Board of Directors 04Corporate Structure 06Corporate Information 07Business Review 085-Year Financial Review 10Financial Contents 12

CORPORATE PROFILE

JK Yaming International Holdings Ltd. was incorporated in Singapore on 16 October 1999 and listed on the main board of SGX on 8 August 2001.Our company is an investment holding company with operations based solely in the Peoples’ republic of China (“PRC”).

Our subsidiaries are principally engaged in the research and design , engineering and manufacturing and sales of HID electrical lighting products, Induction lamps for infrastructural , industrial, commercial and residential projects, as well as wire harnessing products for automotive manufacturers.

Under the fl agship of JK Yaming International Holdings Group, there are currently 10 subsidiaries and one associate with 9 production facilities located in Nanping, Fuzhou, Anhui Ningguo, Shanghai in the PRC.

We market our range of products both domestically and internationally including Japan, Korea, Europe, USA and South East Asia.

Our products had been well received for its image of excellent, innovative technology, quality, after sales service and competitive prices.

We are catching up with the well established players in the market such as Osram, Philip and General Electric in terms of product innovation, technology, engineering and manufacturing processes and quality standard.

We are the only producer of 400 W induction lamps in the world and we therefore claim to be the world leader in this range of product.

We had received numerous awards and certifi cations from government and professional bodies.

In year 2008, we achieved two very important technology breakthroughs and new milestones:

1 In June 2008, we were awarded First Class Honor for our 400 W induction lamp in the Chinese Electrical Lighting Contest held in Guanzhou.

This is an international contest with participants coming from all parts of the world including leading market players.

2 In August 2008, we were awarded qualifi ed energy saving products suppliers for 100 W to 400 W induction lamps by Shanghai Municipal City Energy Saving Product Review Committee.

3 2 of our subsidiaries had also been awarded High tech Enterprise-with special tax incentives and other statutory privileges.

4 FJJK was appointed by the National Lighting Standard Association Committee of China as the pioneer company to prepare and publish manufacturing and grading standards for the Chinese Induction lamps industry.

1

PERFORMANCE REVIEWThe Group scored another revenue record breaking year of S$177.5 million this year compared with S$158.1 million in FY2007. Gross profi t increase by S$6.7 million or 32.1 % from S$20.7 million in FY2007 to S$27.4 million this year. Gross profi t margin outperformed FY2007 by a signifi cant 2.3 percent point from 13.1 % in FY2007 to 15.4% this year. This was largely attributed to our Induc-tion lamps product with gross margin range form 35% to 50%.

The Group’s increase in revenue is attributable to the induction lamps that alone accounts for S$13 million or 68% of the total revenue increase of S$19 million.

Induction lamps revenue increased from S$6 million in FY2007 to S$19 million this year.Revenue from other segments contributed marginally to the overall increase.

Operating profi t from the electrical lighting (Traditional HID lighting products and Induction lamps together) decreased by S$0.5 million from S$3.5 million in FY2007 to S$ 3 million this year. The Group as a matter of prudence provided a one time additional S$3 million charge for the impairment of receivables under the current global and fi nancial conditions.

If this provision were to be disregarded this electrical lighting segments would have made a profoma operating profi t of S$ 6.5 million or a improvement of 85% compared with FY2007.

“The Group’s increase in revenue is attributable to the induction lamps that alone accounts for S$13 million or 68% of the total revenue increase of S$19 million.”

CHAIRMAN’S STATEMENT

2

CHAIRMAN’S STATEMENT

DIVIDENDThe company had since middle of FY2008 engaged in fund raising program to meet the production facilities expansion capital requirement for induction lamps but it was unfortunately delayed by the world fi nancial crisis, in order to keep our expansion program going normally, the profi t is being retained to meet the capital expenditure requirement. The board has decided not to recommend cash dividend for the year ended 31 December 2008.

LOOKING AHEADWe expect a very tough and yet challenging year of 2009 under the current global fi nancial and economic condition.

Among our two major business segments--the wire harnessing and electrical lighting--, we are expecting an overall realignment (almost totally reversed from the past mix pattern) in the revenue and profi t contribution mix.

We expect the sales of wire harness to drop signifi cantly by at least 30% and as well as its contribution to profi t, in this regards, preventive measures had already been taken to reduce manpower and overhead cost control of this business segment and we expect harnessing segment to remain at least breakeven in light of the general collapse of the automobile industry.

On the contrary, we see rising business opportunity on the electrical lighting business segments , demand for our energy saving and environmental friendly induction lamps in particular, is expected to rise rapidly in response to PRC’s economic stimulus in infrastructure , energy saving and environmental protection.

The world at large including China is putting up special economic stimulus effort to promote economic growth and protect environment. Our induction lamps meet the requirement well and we expect to participate very aggressively in this aspect of business opportunity, the infrastructure projects, namely the high ways, the tunnel, the parks, the street lights, the ports and many others. We achieved 217% increase in revenue

in FY2008 with only one production line for induction lamps. We are currently in the process to increase more production lines and production capacity in order to tape into this vast market opportunity domestically and internationally. We are actively looking for strategic investors and partners to take this business segment to the next level.

We continue to focus our effort and resources into research and development for new products and technology in the application of induction lamps. We had been successful in engineering induction lamps for agricultural application that simulates sun energy ultraviolet light generated by the induction lamps to accelerate the organic growth of the farm products. In the pipeline, we are also engaged in the research of induction lamps products that will be used in the solar power application. Induction lamps inherent energy saving properties, high temperature tolerance and long durable life makes it most suitable for this aspect of solar lighting system application, especially in those rural areas with very rough climatic conditions where electrical energy supplies is diffi cult and costly to reach.

On behalf of the board, I wish to thank our valued customers, suppliers, and business associates for their continuous support. I would also like to thank our loyal shareholders for their patients and confi dence with JK Yaming. We are committed to increase our shareholders value in the long term. Finally, I would like to express my heart felt appreciation to our management and staff for their hard work and commitment to make FY2008 another outstanding year and looking forward to their continuous support for the challenging year ahead.

3

Mr Ang Chiong ChaiExecutive Chairman

Mr Ang Chiong Chai is the Executive Chairman of our Company and is responsible for the overall management and the strategic development of our business. Mr Ang has more than 30 years of experience in the trade, management, and manufacturing aspects of electrical products industry. Prior to joining us in 1995, Mr Ang was the Managing Director and founder of Juan Kuang Holdings Sdn Bhd., which in 1995 entered into a joint venture with Nanping Electric Equipment and Shanghai Yaming to establish our operation in the PRC. Mr Ang holds a Bachelor degree in Commerce from the Nanyang University of Singapore.

Mr Chen MinExecutive Director

Mr Chen Min is responsible for the management of our PRC operations and was the pioneer of our research and development division, which has developed various advanced electrical lighting products that have won various awards in China. Mr Chen is also the founder of Nanping Electrical Equipment with a team of technicians, which, in 1995, went into a joint venture with Juan Kuang Holdings Sdn. It was later on headed by our Chairman, Mr Ang Chiong Chai. Mr Chen has more than 20 years of experience in the electrical lighting industry. The State Council of Fujian has recognised his contributions in the technical engineering held with a certifi cate of commendation in 1992. In addition, he has been representing us as executive member of China Association of Lighting Industry Council in Beijing since 1999. Mr Chen was awarded the Fujian Province Excellent Entrepreneur in 1999.

Mr Tan Boon Kiat @ Tan Ka SengExecutive Director

Mr Tan Boon Kiat @ Tan Ka Seng is responsible for exploring business opportunities in the Company’s overseas

BOARD OF DIRECTORS

market and has more than 30 years of experience in fi nance and managerial operations. He is also a member of the Board of Directors of Shanghai Lighting Co. Ltd. and Fujian Juan Kuang Wireharness Electric Co. Ltd.

Mr Ng Kim PohNon-Executive Director

Mr Ng Kim Poh provides advice and guidance to our operations and strategic directions. He has also been a director of Fujian Juan Kuang Yaming Electric Co., Limited since 1995. Currently, Mr Ng is also a member of the Board of Directors of Anhui Juan Kuang Electric Co. Ltd, Shin-Feng Investments Co., Ltd., Amko Industrial Co., Ltd. (Taiwan), and Amko Industrial Co., Ltd. (British Virgin Islands). Mr Ng holds a Bachelor in International Marketing from the National Chengchi University in Taiwan and a MBA degree from Tulane University (U.S.A.).

Mr Lee Poo SikNon-Executive Director

Mr Lee Poo Sik was appointed in 1995 as director of our PRC subsidiary Fujian Juan Kuang Yaming Electric Co., Limited. Mr Lee is also a member of the Board of Directors of Juan Kuang Holdings Sdn Bhd and is its senior fi nance director responsible for its fi nancial operations. Mr Lee holds a Bachelor degree in Commerce (Accountancy) from theNanyang University.

Mr Kuo Shaw -JyeNon-Executive Director

Mr Kuo Shaw-Jye is currently the General Manager of Phihong Technology Co., Ltd., a listed company in Taiwan. He has more than 20 years of experience in marketing and manufacturing in the personal computer and electrical products industries. Prior to joining Phihong in 1999, Mr Kuo Shaw-Jye was the Vice President of Sales and Marketing of Clevo Computer Co., Ltd. He holds a Master’s degree in mechanical engineering from the National Cheng Kung University in Taiwan.

Mr Yu Swe SingIndependent Director

Mr Yu Swee Sing was appointed as an Independent Director on 2 May 2006. He is currently the Lead Independent Director, Chairman of the Audit Committee and a member of Nominating Committee. Mr Yu graduated from Singapore Polytechnic in electronic and communication, and was the Managing Director of Enersave Holding Ltd., a listed fi rm in Singapore, from 1998 to 2002. Prior to that, he was the Managing Director of Ideas Engineering Private Limited.

Mr Seow Seng WeiIndependent Director

Mr Seow Seng Wei was appointed as an Independent Director on 14 December 2006. He is the Chairman of the Group’s Remuneration Committee and a member of the Nominating Committee. Mr Seow graduated with a degree in civil engineering from the University of New Mexico, U.S.A. He also holds a Master’s degree in Project management from the National University of Singapore. Mr Seow, with more than 20 years of working experience in the construction industry, is currently the Managing Director of Teambuild Group of companies in construction and property management.

Mr James Lee Ah FongIndependent Director

Mr James Lee Ah Fong was appointed as an Independent Director on 3 January 2007. He is the Chairman of the Nominating Committee and a member of the Audit and Remuneration Committee. Mr Lee is the partner of a Singapore law fi rm, Ng Lee & Partners. He was admitted to the Singapore Bar on 9 September 1981. He is currently a member of the Board of Trustees of the Chinese Development Assistance Council, the Vice-Chairman of Yuying Secondary School Management Committee and a Council Member of the Singapore Federation of Chinese Clan Associations.

4

The group scored another revenue record breaking year of S$177.5 million this year compared with S$158.1nz million in FY2007.

Gross profi t increase by S$6.7 million or 32.1 % from S$20.7 million in FY2007 to S$27.4 million this year.

5

CORPORATE STRUCTURE

JKYM Trading Pte Ltd - JKT

25%

22.5%

Sales and Distribution of Fire and Burglary Resistant Safes

65%

12.5%

55%

57.4%

100%

90%

96.92% 96.92% 96.92%

70%

25%

65%

100%

30%

55%

35%

999

JK YAMING AMING YAMING YINTERNAINTERNATIONAL TIONAL INTERNATIONAL INTERNAHOLDINGS LHOLDINGS LTD.HOLDINGS LTD.HOLDINGS L

Investment Holding CompanInvestment Holding Company

Shanghai Juan Kuan Lighting Co., Ltd - SHJK

Manufacturing and Sales of HID Lamps and Ceramic Metal Halide Lamps

%

Fujian J.K. Wiring Systems Co., Ltd - JKWJKWJK

Fujian Minhang Electronics Co., Ltd - MH

Shanghai Yuan Ya Lighting Engineering Co., Ltd - SHCT

Shaghai Juan Kuan Lighting Fixture Co., Ltd - SHDJ

Shanghai JK&YM International Trade Ltd - SHT

Manufacturing of Sales Harness Productsfor Export

Research, Development and Production of Multi-layered Ceramic PackagesProducts

Project Design and Consulting, Installation and Sales of Electrical Lighting Products

Manufacturing and Sales of Electric Fixtures and Accessories

International trade, Import and Export of Lighting Products

Anhui Juan Kuang Electric Co., Ltd - AHJK

Manufacturing and Sales CapacitorsManufacturing and Sales Capacitors

%

Fujian Juan Kuang Wireharness Electric Ltd - JKE

Manufacturing and Sales of Wire Harnesses

Fujian Juan Kuan Metal Industries Co., Ltd. - Fujian Juan Kuan Metal Industries Co., Ltd. - JKMI

Manufacturing and Sales of Fire and Burglary Resistant Safes

FUJIAN JUAN KUANG YAMINGYYELECTRIC LIMITED - FJKYM

Manufacturing and Sales of Induction Lamp andElectronic Balasses, Ignitors and Lighting FixturesEE

Associate

6

CORPORATE INFORMATION

BOARD OF DIRECTORSAng Chiong Chai Executive ChairmanChen Min Executive DirectorTan Boon Kiat @ Tan Ka Seng Executive DirectorLee Poo Sik Non-Executive DirectorNg Kim Poh Non-Executive DirectorKuo Shaw-Jye Non-Executive DirectorYu Swee Sing Independent DirectorSeow Seng Wei Independent DirectorJames Lee Ah Fong Independent Director

AUDIT COMMITTEEYu Swee Sing ChairmanJames Lee Ah FongLee Poo Sik

NOMINATING COMMITTEEJames Lee Ah Fong ChairmanYu Swee SingSeow Seng WeiAng Chiong ChaiNg Kim Poh

REMUNERATION COMMITTEESeow Seng Wei ChairmanJames Lee Ah FongNg Kim Poh

COMPANY SECRETARYKhoo Eng Hock

REGISTERED OFFICE160 Paya Lebar Road, #08-03/04Orion Industrial BuildingSingapore 409022Tel: (65) 6846 9063Fax: (65) 6846 8212Email: [email protected]: www.fjik.com

SHARE REGISTRARBoardroom Corporate & Advisory Services Pte Ltd3 Church Street #08-01Samsung HubSingapore 049483

AUDITORLTC LLPCertifi ed Public Accountant1 Raffl es Place#20-02 OUB CentreSingapore 048616

PARTNER-IN-CHARGETsang Siu For ThomasAppointed since fi nancial year ended 31 December 2007

PRINCIPAL BANKERUnited Overseas bank Limited80 Raffl es Place UOB PlazaSingapore 048624

7

BUSINESS REVIEW

The group scored another revenue record breaking year of S$177.5 million this year under the prevailing global fi nancial and economic conditions. The group revenue performance were mildly affected by the fi nancial and economic crisis during the last quarter of the fi nancial year 2008.

We did well in two major segments namely the wire harnessing for automobile and electrical lighting business. Additionally the group also witnesses a trend of relative increase in revenue contribution from electrical lighting segment , its contribution to the group’s overall revenue had increased from 35% to 40% from FY2004 to FY2008 and on the contrary , we also witnesses a downward trend of wire harnessing segments whose revenue contribution had decreased from 64% to 57% from FY2004 to FY2008.

The major contribution to this revenue growth and mix phenomena was attributable mainly to the increase of induction lamps of S$13 million or 68% of the total revenue increase. Induction lamps revenue increased from S$6 million to S$19 million this year that

translated into a 217% increase with only one production line.

Our extensive and intensifi ed research and development, production and marketing effort in the past years has begun to demonstrate fruitful results. This year we produce 123,000 units of induction lamps of various wattage and product types.

The group’s gross profi t rose by S$6.7 million or 32.3 % from S$20.7 million in FY2007 to S$27.4 million this year.

Gross margin outperformed by a signifi cant 2.3% from 13.1 % in FY2007 to 15.4 % in FY2008. This was mainly contributed by the induction lamps whose margin range from 35% to 50% depending on the wattage and value engineering content of the product type.

The group’s profi t before tax increased by S$0.9 million or 18.9 % from S$4.8 million in FY2007 to S$5.7 million in FY2008.

The group as a matter of prudence provided additional S$ 3 million for potential

8

BUSINESS REVIEW

impairment of trade receivables and other receivables under the condition of current global economic fi nancial condition in Q4 this year.

If this onetime charge were to be disregarded, the profoma increase in profi t before tax would have been S$3.9 million that translated into a profoma increase of 82.3%. Profi t contribution from wire harness and other traditional HID electrical lighting remain stable.

Looking ahead and going forward into FY2009, under the current global turbulent fi nancial and economic condition , we expect contribution from wire harnessing to revenue and profi t to be materially affected by the global deteriorating demand for automobile industry. But on the other hand, we see rising business opportunity on the electrical lighting business segment, demand for our energy saving and environmental friendly induction lamps in particular, is rising rapidly in response to PRC’s economic stimulus in infrastructure , energy saving and environmental protection.

The world at large including China is putting up special economic stimulus effort to promote economic growth and protect environment. Our induction lamps meet the requirements well and we expect to participate very aggressively in this aspect of business opportunity, the infrastructure projects, namely the high ways, the tunnel, the parks, the street lights, the ports and many others. We continue to focus our effort and resources in research and development for new products and technology in the application of induction lamps. We had been successful in engineering induction lamps for agricultural application that simulates sun energy ultraviolet light generated by the induction lamps to accelerate the organic growth of the farm products. In the pipeline, we are also engaged in the research of induction lamps products that will be used in solar power application. Induction lamps inherent energy saving properties, high temperature tolerance and long durable life makes it most suitable for this aspect of solar lighting system application, especially in those rural areas with very rough climatic conditions where electrical energy supplies is diffi cult and costly to reach.

9

5 YEARS FINANCIAL REVIEW

ChinaJapanOther

Electrical LightingWireharnessOthers

Electrical LightingWireharnessOthers

Turnover (S$ ’000)12

0,48

6

137,

057

139,

433

158,

075

177,

482

2004 2005 2006 2007 2008

Profit Before Tax (S$ ’000)

6,18

6

5,67

0

4,62

4

4,80

0

5,70

8

2004 2005 2006 2007 2008

Turnover by Geographical regions (S$ ’000)

2004 2005 2006 2007 2008

31,1

05

76,1

96

13,1

85

19,7

75

87,5

40

29,7

42

40,7

35

78,0

78

20,6

20

35,2

36

97,1

53

25,6

86

41,9

10

100,

906

34,6

66

Turnover by Products group (S$ ’000)

2004 2005 2006 2007 2008

42,1

98

77,2

01

1,02

4

46,2

15

88,0

50

2,79

2

51,4

94

82,6

36

5,30

3

56,8

13

97,1

53

4,10

9

70,6

09

100,

992

5,88

1

Product group Mix percentage (%)

2004 2005 2006 2007 2008

35

64

1

34

64

2

37

59

4

36

61

3 3

40

57

10

Gross profi t margin outperformed FY2007 by a signifi cant 2.3 percent point from 13.1 % in FY2007 to 15.4% this year.

This was largely attributed to our Induction lamps product with gross margin range form 35% to 50%.

11

Corporate Governance Report 13

Directors’ Report 23

Statement by Directors 25

Independent Auditors’ Report 26

Consolidated Income Statement 28

Balance Sheets 29

Consolidated Statement of Changes in Equity 30

Consolidated Cash Flow Statement 31

Notes to the Financial Statements 33

Statistics of Shareholdings 80

Notice of Annual General Meeting 82

Proxy Form

Financial Contents

CORPORATE GOVERNANCE STATEMENT

The Company is committed to maintaining a high standard of corporate governance within the Company and its subsidiaries. The Company is adopting the corporate governance practices contained in the Code of Corporate Governance 2005 (the “Code”) so as to ensure greater transparency and protection of shareholders’ interests. This report discusses the Company’s corporate governance processes and activities with reference to the Code.

BOARD MATTERS

The Board’s Conduct of its Affairs

Principal 1 Every company should be headed by an effective Board to lead and control the company. The Board is collectively responsible for the success of the Company. The Board works with Management to achieve this and the management remains accountable to the Board

The Board has the responsibility for the overall management of the Group. It establishes the corporate strategies of the Group, sets direction and goals for the executive management. It supervises the executive management and monitors performance of these goals to enhance shareholders’ value. The Board is responsible for the overall corporate governance of the Group.

To assist in the execution of its responsibilities, the Board has established an Audit Committee, a Nominating Committee and a Remuneration Committee. These committees function within clearly defi ned terms of references and operating procedures, which are reviewed on a regular basis. The effectiveness of each committee is also constantly reviewed by the Board. The roles and responsibilities of these committees are provided for in the latter sections of this Annual Report.

The full Board meets on a regular basis and as when necessary to address any specifi c signifi cant matters that may arise.

As provided under the Articles of Association of the Company, the Directors of the Company may participate in any meeting of the Board by means of telephone conference or other similar communication equipment which will permit all persons participating in the meeting to communicate with each other simultaneously and instantaneously.

The number of Board and Board Committee meetings held during the fi nancial year ended 31 December 2008 (“FY2008”) and the attendance of each Director where relevant are as follows:

BoardAudit

CommitteeNominating Committee

Remuneration Committee

No. of meetings 4 4 1 1

No. of meetings attended by respective Directors

Ang Chiong Chai 4 N/A 1 N/AChen Min 4 N/A N/A N/ATan Boon Kiat @ Tan Ka Seng 4 N/A N/A N/ALee Poo Sik 4 4 N/A N/ADato’ Ng Kim Poh 4 N/A 1 1Kuo, Shaw-Jye 3 N/A N/A N/AYu Swee Sing 4 4 1 N/ASeow Seng Wei 4 N/A -* 1Lee Ah Fong James 4 3 1 1

* Mr. Seow Seng Wei was appointed to the Nomination Committee as a member, with effect from 28 February 2008.

13


The Board has identifi ed of the following areas for which the Board has direct responsibility for decision-making :-

• Approval of major investments and funding decisions; • Approval of quarterly and full year result announcements;• Approval of the Annual Reports and Audited Financial Statements;• Convening of Shareholders’ Meetings;• Approval of Corporate Strategies; and• Approval of material acquisitions and disposal of assets.

Visits to the Group’s production facilities are also arranged to acquaint the Non-Executives Directors with the Group’s operations.

Board Composition And Guidance

Principal 2 There should be a strong and independent element on the Board, which is able to exercise objective judgement on corporate affairs independently, in particular, from Management. No individual or small group of individuals should be allowed to dominate the Board’s decision making.

The Board of Directors comprises the following nine (9) Directors, three (3) of whom are Independent Directors :-

(i) Mr Ang Chiong Chai (Executive Chairman)(ii) Mr Chen Min (Executive Director)(iii) Mr Tan Boon Kiat @ Tan Ka Seng (Executive Director)(iv) Mr Lee Poo Sik (Non-Executive Director)(v) Dato’ Ng Kim Poh (Non-Executive Director)(vi) Mr Kuo, Shaw-Jye (Non-Executive Director)(vii) Mr Yu Swee Sing (Independent Director)(viii) Mr Seow Seng Wei (Independent Director)(ix) Mr Lee Ah Fong James (Independent Director)

On an annual basis and upon notifi cation by an Independent Director of a change in circumstances, the Nominating Committee will review the independence of each Independent Director based on the criteria for independence defi ned in the Code and recommends to the Board as to whether the Director is to be considered independent.

The Board examines its size and composition and after taking into account the nature and scope of the Company’s operations, is of the opinion that the current Board, with its diversifi ed background and experience, provides core competencies such as fi nance, accounting, legal, business management, industry knowledge and strategic planning experience, is appropriate and effective to ensure the balance of power and authority to facilitate effective decision making.

Key information regarding the Directors are provided on page 4.

Chairman And Chief Executive Offi cer

Principal 3 There should be a clear division of responsibilities at the top of the company – the working of the Board and the executive responsibility of the company’s business – which will ensure a balance of power and authority, such that no one individual represents a considerable concentration of power.

The Group’s Executive Chairman, Mr. Ang Chiong Chai, also assumes the role of the Chief Executive Offi cer (“CEO”). The Board is of the view that it is in the best interests of the Group to adopt a single leadership structure, and that there are suffi cient safeguards in place to ensure that the management is accountable to the Board as a whole.

14

The Chairman / CEO ensures that Board meetings are held when necessary, sets Board meeting agenda and reviews Board papers prior to presenting them to the Board. The Chairman / CEO also ensures that Board members are provided with complete, adequate and timely information on a regular basis to enable them to be fully cognisant of the affairs of the Group.

Mr Yu Swee Sing acts as the Group’s Lead Independent Director to whom any concerns about the Group may be conveyed to. Any such concerns may be sent to his e-mail address at [email protected].

Board Membership

Principal 4 There should be a formal and transparent process for the appointment of new directors to the Board.

The Nominating Committee (“NC”) comprises the following fi ve (5) members, a majority of whom including the Chairman of the NC, are Independent Directors. The Chairman of the NC is also not associated with any substantial shareholder of the Company.

Mr Lee Ah Fong James (Chairman) Mr Yu Swee Sing (Member) Dato’ Ng Kim Poh (Member) Mr Ang Chiong Chai (Member) Mr. Seow Seng Wei (Member)

The NC is governed by the NC Terms of Reference which describes the duties and functions of the NC. The NC’s principal functions are as follows:

(a) To make recommendations to the Board on all board appointments having regard to the Director’s contribution and performance (e.g. attendance, preparedness, participation, candour and any other salient factors);

(b) To determine the independence of the Directors annually;(c) To determine whether a Director is able to and has adequately carried out his duties as a Director of the Company, where

the Director has multiple Board representations; and(d) To decide how the Board’s performance may be evaluated and propose objective performance criteria that allow comparison

with industry peers, for approval by the Board.

The Articles of Association of the Company provides that one-third (1/3) of the Directors (or if their number is not a multiple of three (3), the number nearest to but not less than one third (1/3)) shall retire from offi ce by rotation at each Annual General Meeting (“AGM”). Accordingly, the Directors submit themselves for re-nomination and re-election at regular intervals of at least once every three (3) years. A retiring Director shall be eleigible for re-election.

The details of Directors who will retire by rotation at the forthcoming AGM, Mr. Lee Poo Sik and Mr. Yu Swee Seng, are disclosed on page 4 of this Annual Report.

The Directors of or over 70 years of age are required to be re-elected every year at the AGM under Section 153(6) of the Companies Act Chapter 50 (“the Act”) before they could continue in the offi ce as Director.

The details of Directors who submitted themselves for re-appointment under Section 153(6) of the Act at the forthcoming AGM, Mr Ang Chiong Chai and Mr Tan Boon Kiat @ Tan Ka Seng, are disclosed on page 4 of this Annual Report.

Where a vacancy arises, the NC will consider each candidate for directorship based on the selection criteria determined after consultation with the Board and after taking into consideration the qualifi cation and experience of such candidate, his/her ability to increase the effectiveness of the Board and to add value to the Group’s business in line with its strategic objectives, the NC will recommend the candidate to the Board for approval. Under the Articles of Association of the Company, a newly appointed Director shall retire at the AGM following his/her appointment and he/she shall be eligible for re-election.


15

Board Performance

Principal 5 There should be a formal assessment of the effectiveness of the Board as a whole and the contribution by each director to the effectiveness of the Board.

The NC reviews and evaluates the performance of the Board as a whole, taking into consideration the attendance record at the meetings of the Board and the Board Committees and also the contribution of each Director to the effectiveness of the Board.

Other than attendance records at meetings, the contribution of individual Directors are also measured by other performance criteria which the Board may propose. These include a benchmark index of its industry peers, return on assets, return on equity, return on investment, economic value added and profi tability on capital employed.

Access To Information

Principal 6 In order to fulfi l their responsibilities, Board members should be provided with complete, adequate and timely information prior to board meetings and on an on-going basis.

The Board has separate and independent access to senior management and the company secretary at all times. Requests for information from the Board are dealt with promptly by the management. The Board is informed of all material events and transactions as and when they occur. The management provides the Board with quarterly and full-year fi nancial results, progress reports of the Group’s operations, corporate development, regulatory updates, business development and audit reports. The management also seek consultation from the Board regularly whenever necessary and appropriate. The Board is issued with the meeting agenda and Board papers on a timely basis prior to any Board meetings.

The company secretary administers, attends and prepares minutes of the Board and Board Committee meetings, and assists the Chairman in ensuring that Board procedures are followed and reviewed so that the Board functions effectively and the Company’s Memorandum and Articles of Association, Listing Manual of SGX-ST and other relevant rules and regulations applicable to the Company are complied with. The appointment and removal of the company secretary are decided by the Board as a whole.

The Board in fulfi lling its responsibilities can, whether as a group or individually, when deemed fi t, direct the Company to appoint professional advisers to render professional advice.

REMUNERATION MATTERS

Principal 7 There should be a formal and transparent procedure for developing policy on executive remuneration and for fi xing the remuneration packages of individual directors. No director should be involved in deciding his own remuneration.

The Remuneration Committee (“RC”) comprises the following three (3) members, all of whom are Non-Executive Directors and a majority, including the Chairman of the RC are Independent Directors :-

Mr. Seow Seng Wei (Chairman) Mr. Lee Ah Fong James (Member) Dato’ Ng Kim Poh (Member)

The RC is governed by the RC’s Terms of Reference which describes the duties and the powers of the RC. The functions of the RC are :-

(a) to recommend to the Board a framework of remuneration for the Board and key executives, and to determine specifi c remuneration packages for each Executive Director, which covers all aspects of remuneration including but not limited to directors’ fees, salaries, allowances, bonuses, options and benefi ts in kind;


16

(b) in the case of service contracts of Directors, to review and to recommend to the Board, the terms of renewal of service contracts and to consider the compensation commitments of the service contracts in the event of early termination; and

(c) to retain such professional consultancy fi rm deemed necessary to enable the RC to discharge their duties satisfactorily.

The RC’s recommendations are made in consultation with the Chairman of the Board and submitted to the entire Board for endorsement.

No Director is involved in the discussion and in deciding his own remuneration.

Level And Mix Of Remuneration

Principal 8 The level of remuneration should be appropriate to attract, retain and motivate the directors needed to run the company successfully but companies should avoid paying more than is necessary for this purpose. A signifi cant proportion of executive directors’ remuneration should be structured so as to link rewards to corporate and individual performance.

In setting remuneration packages, the RC will take into consideration the pay and employment conditions within the industry and comparable companies. The remuneration of Non-Executive Directors will also be reviewed to ensure that their remuneration commensurate with the contribution and responsibilities of each Non-Executive Directors.

The payment of Directors’ fees to Non-Executive Directors are subject to approval by shareholders at the Company’s AGM.

Disclosure On Remuneration

Principal 9 Each company should provide clear disclosure of its remuneration policy, level and mix of remuneration, and the procedure for setting remuneration, in the company’s annual report. It should provide disclosure in relation to its remuneration policies to enable investors to understand the link between remuneration paid to directors and key executives and performance.

The remuneration of the Directors and the key executives, who are not Directors of the Company, for FY2008, are disclosed below. The disclosure is to enable investors to understand the link between remuneration paid to Directors and key executives, and their performance.


17

The breakdown (in percentage terms) of the Directors’ and key executives’ remuneration for FY2008 are as follows:-

Name Remuneration Band S$Salary

%Bonus

%

Fringe Benefi ts

%

Directors’ Fees% Total

DirectorsAng Chiong Chai Between $250,000 and $500,000 66 29 5 - 100.0Chen Min Below $250,000 71 28 1 - 100.0Tan Boon Kiat @ Tan Ka Seng Below $250,000 92.2 7.8 - - 100.0Lee Poo Sik Below $250,000 - - - 100.0 100.0Ng Kim Poh Below $250,000 - - - 100.0 100.0Kuo, Shaw-Jye Below $250,000 - - - 100.0 100.0Yu Swee Sing Below $250,000 - - - 100.0 100.0Seow Seng Wei Below $250,000 - - - 100.0 100.0Lee Ah Fong James Below $250,000 - - - 100.0 100.0

Key ExecutivesZhen Qing Fa Below $250,000 50 42 8 - 100.0Wen Hai Bo Below $250,000 81 16 3 - 100.0Zhang He Quan Below $250,000 51 46 3 - 100.0Chen He Ping Below $250,000 46 53 1 - 100.0Sun Shi Ping Below $250,000 46 52 2 - 100.0

The Company does not have any employee who is an immediate family member of a Director or CEO, and whose remuneration for FY2008 exceeds S$150,000.

ACCOUNTABILITY AND AUDIT

Accountability

Principal 10 The Board should present a balanced and understandable assessment of the Company’s performance, position and prospects.

The Board is responsible to provide a balanced and understandable assessment of the Company’s performance, position and prospects, to its shareholders, the public and regulators.

The Board is accountable to the shareholders and is mindful of its obligations to furnish timely information and to ensure full disclosure of material information to shareholders in compliance with statutory requirements and the Listing Manual of SGX-ST.

Price sensitive information will be publicly released either before the Company meets with any group of investors or analysts or simultaneously with such meetings. Financial results and annual reports will be announced or issued within the statutory prescribed periods.


18

Audit Committee

Principal 11 The Board should establish an Audit Committee (“AC”) with written terms of reference which clearly set out its authority and duties.

The Audit Committee (“AC”) comprises the following three (3) members, all of whom are Non-Executive Directors and a majority, including the Chairman of the AC, are Independent Directors :-

Mr. Yu Swee Sing (Chairman) Mr. Lee Ah Fong James (Member) Mr. Lee Poo Sik (Member)

The AC is governed by the AC Terms of Reference which highlights its duties and functions. The functions of the AC are as follows:-

(a) to review with external auditors their audit plan, their audit report and their evaluation of the Group’s system of internal accounting controls;

(b) to review the quarterly and full-year fi nancial results of the Company and the Consolidated Financial Statements of the Group, before they are presented to the Board;

(c) to review the scope and results of audit and its cost effectiveness and the independence and objectivity of the external auditors. Where the external auditors also supply a substantial volume of non-audit services to the Company, to review the nature and extent of such services to maintain the balance of objectivity and value for money;

(d) to review annually the effectiveness of the Company’s material internal controls including fi nancial, operational and compliance control and risk management;

(e) to review the assistance given by the management to the external auditors;

(f) to ensure that the internal audit function is adequately resourced and has appropriate standing within the Company and to review the adequacy of the function annually;

(g) to review the scope and results of the internal audit procedures;

(h) to follow up on the implementation of internal control procedures;

(i) to meet with the external and internal auditors without the presence of the management, annually;

(j) to review any interested persons transactions;

(k) to review the independence of the external auditors annually; and

(l) to consider the appointment and re-appointment of the external auditors.

The AC has the power to conduct or authorize investigations into any matters within the AC’s scope of responsibility. The AC is authorized to obtain independent professional advice if it deems necessary in the discharge of its duties and responsibilities. Such expenses are to be borne by the Company.

The AC has full access to and co-operation of the Company’s management and has full discretion to invite any Director or executive offi cer to attend the AC meetings, and has been given reasonable resources to enable it to discharge its functions.


19

During the FY2008, the AC met four (4) times to discuss the following matters:-

(a) reviewed the External Auditors’ fi ndings presented by Messrs. LTC LLP (“LTC”) in respect of the statutory audit of the accounts of the Group for the fi nancial year ended 31 December 2008;

(b) reviewed the quarterly and full-year unaudited results announcements, before recommending it to the Board for approval;

(c) reviewed the nature and extent of non-audit services provided by LTC during FY2007 and reviewed their independence;

(d) received and approved the External Audit Plan for the fi nancial year ended 31 December 2008, by the External Auditors;

(e) reviewed the Internal Audit fi ndings and the Group’s Internal Audit process and Internal Control System;

(f) reviewed the draft Circular to Shareholders in relation to the Renewal of Interested Persons Transactions Mandate, before recommending it to the Board for approval;

(g) reviewed and approved any interested persons transactions; and

(h) reviewed the excerpt of the AC’s disclosure in the Corporate Governance Statement of the Company’s 2007 Annual Report

During FY2008, upon recommendation by the AC and Board, the shareholders of the Company had during the AGM of the Company held on 28 April 2008, appointed LTC LLP, as the Company’s external auditors for FY2008.

The AC, having reviewed the range and value of non-audit services performed by LTC LLP and being satisfi ed that the nature and extent of such services will not prejudice the independence and objectivity of the external auditors, are pleased to confi rm their re-nomination.

There was no non-audit fee paid/payable to the auditors of the Comapny for the fi nancial year ended 31 December 2008.

The Company has in place a Whistle-Blower Policy and Procedure for the Group to enable persons employed within the Group a channel to report any suspicions of non-compliance with regulations, policies and fraud, etc, to the appropriate authority for resolution, without any prejudicial implications for these employees. The AC has been vested with the power and authority to receive, investigate and enforce appropriate action when any such non-compliance matter is brought to its attention.

Internal Controls

Principal 12 The Board should ensure that the Management maintains a sound system of internal controls to safeguard the shareholders’ investments and the company’s assets.

It is in the opinion of the Board that, in the absence of evidence to the contrary, the system of internal controls maintained by the Company’s management and that was in place throughout FY2008 and up to the date of this Annual Report provides reasonable, but not absolute, assurance against material fi nancial misstatements or losses, and includes the safeguarding of assets, the maintenance of proper accounting records, the reliability of fi nancial information, compliance with appropriate legislation, regulations and best practices, and the identifi cation and containment of fi nancial, operational and compliance risks. The Board notes that all internal control systems contain inherent limitations and no system of internal controls could provide absolute assurance against the occurrence of material errors, poor judgment in decision-making, human error losses, fraud or other irregularities.

Internal Audit

Principal 13 The company should establish an internal audit function that is independent of the activities it audits.

The Company outsources its internal audit function to an external professional fi rm, who reports directly to the Chairman of AC and administratively to the Chairman of the Board. The objective of the internal audit function is to determine whether the Group’s risk management, control and governance processes, as designed by the Company, is adequate and functioning in the required manner. The internal auditors have identifi ed the Group’s main business processes and developed an audit plan that covers the main business process over a 1-2 year audit cycle.


20

The AC will review the adequacy of the internal audit function annually and ensures that the internal audit function is adequately resourced and has appropriate standing within the Company.

COMMUNICATION WITH SHAREHOLDERS

Principal 14 Companies should engage in regular, effective and fair communication with shareholders.

Principal 15 Companies should encourage greater shareholder participation at AGMs, and allow shareholders the opportunity to communicate their views on various matters affecting the company.

The Company does not practise selective disclosure. In line with continuous obligations of the Company pursuant to the Listing Rules of SGX-ST, the Board’s policy is that all shareholders should be equally informed of all major developments impacting the Group.

Information are disseminated to shareholders on a timely basis through:

• announcements and news releases to SGX-ST; and• Annual Reports prepared and issued to all shareholders.

At the Company’s shareholders’ meetings, shareholders are given the opportunity to voice their views and ask Directors or management questions regarding the Company. The Chairmen of the AC, RC and NC will normally be present at AGMs to answer any questions relating to the work of these committees.

There are separate resolutions at the shareholders’ meetings to address each distinct issue. The Articles of Association of the Company allow a member of the Company to appoint not more than two (2) proxies to attend and vote on behalf of the member.

RISK MANAGEMENT

The Company regularly reviews and improves its business and operational activities to identify areas of signifi cant business risks as well as take appropriate measures to control and mitigate these risks. The Company reviews all signifi cant control policies and procedures and highlights all signifi cant matters to the AC and Board.

DEALING IN SECURITIES

In line with the Rule 1207(18) of the Listing Manual of SGX-ST, the Company has in place a policy prohibiting share dealings by Directors and employees of the Group for the period of two (2) weeks prior to the results announcement of the Company’s fi rst three (3) quarters of its fi nancial year and one (1) month before the full-year of its fi nancial year. Directors and employees are expected to observe the insider trading laws at all times even when dealing in securities within permitted trading period.

MATERIAL CONTRACTS

There were no material contracts entered into by the Company or any of its subsidiaries involving the interest of any Director, the CEO or controlling shareholders that are either still subsisting at the end of FY2008 or entered into during FY2008

INTERESTED PERSONS TRANSACTIONS

The Company has established internal control polices to ensure that transactions with interested persons are reported to the AC in a timely manner and are properly reviewed and approved to ensure that they are conducted on an arms’ length basis and are not prejudicial to the interest of the shareholders.


21

The Company seeks annual renewal of a general mandate from its shareholders for those recurrent transactions of revenue or trading nature or those necessary for its day-to-day operations.

Information required to be disclosed in respect of FY2008 are as follows :

Name of Interested Person Aggregate value of all interested person transactions (excluding transactions less than $100,000 and transactions

conducted under shareholders’ mandate pursuant to Listing Manual Rule 920)

Aggregate value of all interested person transactions, conducted under the

shareholder’s mandate pursuant to Rule 920 (excluding transactions less than

$100,000)

Juan Kuang Holding Sdn Bhd and its subsidiaries

0 452,000

Juan Kuang Pte Ltd 0 319,000


22

The directors present their report to the members together with the audited fi nancial statements of the Group for the fi nancial year ended 31 December 2008 and the balance sheet of the Company as at 31 December 2008.

DIRECTORS

The directors of the Company in offi ce at the date of this report are as follows:

Ang Chiong Chai (Executive Chairman)Chen MinTan Boon Kiat @ Tan Ka SengLee Poo SikNg Kim PohKuo Shaw-JyeYu Swee SingSeow Seng WeiLee Ah Fong

ARRANGEMENTS TO ENABLE DIRECTORS TO ACQUIRE SHARES OR DEBENTURES

Neither at the end of nor at any time during the fi nancial year was the Company a party to any arrangement whose object was to enable the directors of the Company to acquire benefi ts by means of the acquisition of shares in, or debentures of, the Company or any other body corporate.

DIRECTORS’ INTERESTS IN SHARES AND DEBENTURES

(a) According to the register of directors’ shareholdings kept by the Company for the purposes of section 164 of the Singapore Companies Act, Cap. 50, none of the directors holding offi ce at the end of the fi nancial year had any interest in the shares or debentures of the Company and related corporations, except as follows :

Holdings registered in name of director or nominee

Holdings in which a director is deemed to have an interest

At 1.1.2008 At 1.1.2008 or date of or date of

appointment, appointment,At 31.12.2008 if later At 31.12.2008 if later

(Ordinary shares of the Company) Ang Chiong Chai 36,136,040 39,336,040 49,222,225 49,222,225Chen Min - - 17,024,750 17,024,750Tan Boon Kiat @ Tan Ka Seng 5 5 - -Lee Poo Sik 120,000 120,000 - -Ng Kim Poh 827,000 827,000 21,913,155 21,913,155

(b) None of the directors holding offi ce at the end of the fi nancial year had interests in options to subscribe for ordinary shares of the Company.

(c) Mr Ang Chiong Chai, who by virtue of his direct and deemed interest of not less than 20% of the issued capital of the Company, is deemed to have an interest in the shares of the various subsidiaries held by the Company as disclosed in Note 15 to the fi nancial statements.

(d) The directors’ interests in the shares of the Company at 21 January 2009 were the same as those as at 31 December 2008.

DIRECTORS’ REPORTFOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2008

23

DIRECTORS’ CONTRACTUAL BENEFITS

Since the end of the previous fi nancial year, no director has received or become entitled to receive a benefi t by reason of a contract made by the Company or a related corporation with the director or with a fi rm of which he is a member or with a company in which he has a substantial fi nancial interest, except as disclosed in the fi nancial statements and in this report, and except that Mr Ang Chiong Chai and Mr Tan Boon Kiat have employment relationship with the Company, and Mr Chen Min has an employment relationship with a subsidiary, and they have received remuneration in those capacities.

SHARE OPTIONS

There were no options granted during the fi nancial year to any person to subscribe for unissued shares of the Company or its subsidiaries.

No shares have been issued during the fi nancial year by virtue of any exercise of options to take up unissued shares of the Company or it subsidiaries.

There were no unissued shares of the Company or its subsidiaries under option at the end of the fi nancial year.

INDEPENDENT AUDITORS

The independent auditors, LTC LLP, have expressed their willingness to accept re-appointment.

On behalf of the directors

ANG CHIONG CHAIExecutive Chairman

TAN BOON KIAT @ TAN KA SENGExecutive Director

Singapore, 31 March 2009

DIRECTORS’ REPORTFOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2008

24

In the opinion of the directors,

(a) the balance sheet of the Company and the consolidated financial statements of the Group as set out on pages 28 to 79 are drawn up so as to give a true and fair view of the state of affairs of the Company and of the Group as at 31 December 2008 and of the results of the business, changes in equity and cash flows of the Group for the financial year then ended on that date; and

(b) at the date of this statement there are reasonable grounds to believe that the Company will be able to pay its debts as and when they fall due.

On behalf of the directors


TAN BOON KIAT @ TAN KA SENGExecutive Director


STATEMENT BY DIRECTORSFOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2008

25

We have audited the accompanying fi nancial statements of JK Yaming International Holdings Ltd. (the “Company”) and its subsidiaries (the “Group”) set out on pages 28 to 79, which comprise the balance sheets of the Company and of the Group as at 31 December 2008, and the consolidated income statement, the consolidated statement of changes in equity and the consolidated cash fl ow statement of the Group for the fi nancial year then ended, and a summary of signifi cant accounting policies and other explanatory notes.

Management’s Responsibility for the Financial Statements

Management is responsible for the preparation and fair presentation of these fi nancial statements in accordance with the provisions of the Singapore Companies Act, Cap. 50 (the “Act”) and Singapore Financial Reporting Standards. This responsibility includes:

(a) devising and maintaining a system of internal accounting controls suffi cient to provide a reasonable assurance that assets are safeguarded against loss from unauthorised use or disposition; and transactions are properly authorised and that they are recorded as necessary to permit the preparation of true and fair profi t and loss accounts and balance sheets and to maintain accountability of assets;

(b) selecting and applying appropriate accounting policies; and

(c) making accounting estimates that are reasonable in the circumstances.

Auditors’ Responsibility

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

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

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

Opinion

In our opinion,

a) the balance sheet of the Company and the consolidated fi nancial statements of the Group are properly drawn up in accordance with the provisions of the Act and Singapore Financial Reporting Standards so as to give a true and fair view of the state of affairs of the Company and of the Group as at 31 December 2008 and the results, changes in equity and cash fl ows of the Group for the fi nancial year ended on that date; and

b) the accounting and other records required by the Act to be kept by the Company and by the subsidiary incorporated in Singapore of which are the auditors have been properly kept in accordance with the provisions of the Act.

INDEPENDENT AUDITORS’ REPORT TO THE MEMBERS OF JK YAMING INTERNATIONAL HOLDINGS LTD.FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2008

26

Without qualifying our opinion, we draw attention to Note 29 to the fi nancial statements.

A claim was lodged by Segue Electronics, Inc and Shine Capacitors, LLC (collectively the “Plaintiffs”) against the Company and two of its subsidiaries Fujian Juan Kuang Yaming Electric Limited and Anhui Juan Kuang Electric Co., Ltd. (collectively the “Defendants”) in the state of Court of California, USA in year 2005.

The Plaintiffs have claimed monetary damages for loss of profi ts, loss of sales and consequential damages for breach of contracts. The Defendants have fi led cross-complaint and responses to dismiss the claims and are defending their actions.

On 13 September 2007, the court entered judgement in favour of the Company during a special hearing on summary judgement fi led by the Company. This resulted in the Company being dismissed from the case. The Plaintiffs have appealed the aforesaid judgement before the Court of Appeals which was scheduled on 12 March 2009. Legal advice obtained from the Company’s legal counsel indicates that they are reasonably confi dent that the Court of Appeals will affi rm the judgement of the trial court. At the date of authorisation for issue of the accompanying fi nancial statements, the Company has yet to hear the decision from the Court of Appeal.

During the jury trial in September to October 2008 held in Carlifornia Superior Court, the jury awarded the Plaintiff, Segue Electronics, Inc approximately S$5,800,000 (equivalent to US$3,900,000) in damages against the Defendant, Anhui Juan Kuang Electric Co Ltd and no damages against Fujian Juan Kuang Yaming Electric Ltd. The jury awarded no damages to the Plaintiff, Shine Capacitors from the Defendants. Judgement has not been entered on this verdict.

Legal advice obtained from the Company’s legal counsel indicates the intention to bring post-trial motions to overturn the aforesaid jury’s verdict and for a new trial when judgment is entered. The legal counsel expressed that they are reasonably confi dent that the court could grant at least this motion and it is possible that the judge will reduce the amount of damages and/or order a new trial on damages.

The ultimate outcome of the matter cannot presently be determined, and no provision for any liability that may result has been made in the fi nancial statements.

LTC LLPPublic Accountants andCertifi ed Public Accountants


INDEPENDENT AUDITORS’ REPORT TO THE MEMBERS OF JK YAMING INTERNATIONAL HOLDINGS LTD

FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2008

27

GroupNote 2008 2007

$’000 $’000

Revenue 5 177,482 158,076 Cost of sales (150,130) (137,362)

Gross profi t 27,352 20,714

Other income - (net) 5 1,538 627

Expenses - Distribution and marketing (4,471) (3,889) - Administrative (16,165) (10,392) - Finance 7 (1,977) (2,260)

Share of loss of an associate 16 (619) -

Profi t before income tax 5,658 4,800

Income tax expense 9 (2,559) (1,075)

Net profi t for the fi nancial year 3,099 3,725

Net profi t attributable to:Equity holders of the Company 1,252 2,136 Minority interests 1,847 1,589

3,099 3,725

Earnings per share for net profi t attributable to equity holders of the Company (expressed in cents per share) – Basic and diluted 10 0.62 1.05

The accounting policies and explanatory notes form an integral part of the consolidated fi nancial statements.

CONSOLIDATED INCOME STATEMENT FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2008

28

Group CompanyNote 2008 2007 2008 2007

$’000 $’000 $’000 $’000ASSETS Current assets Cash and cash equivalents 11 11,653 9,452 - - Trade and other receivables 12 29,310 37,659 515 1,095Inventories 13 30,753 34,032 - -Other current assets 14 1,992 3,039 6 6

73,708 84,182 521 1,101

Non-current assetsInvestments in subsidiaries 15 - - 44,274 47,042Investment in an associate 16 1,248 - 1,009 -Property, plant and equipment 17 47,559 46,682 1,452 1,592Investment properties 18 7,682 7,237 - -Intangible assets 19 758 741 - -

57,247 54,660 46,735 48,634

Total assets 130,955 138,842 47,256 49,735

LIABILITIESCurrent liabilitiesTrade and other payables 20 28,987 43,177 581 820Borrowings 21 23,944 24,882 4,013 4,063Current income tax liabilities 9 1,715 544 - -Deferred income tax liabilities 23 169 159 - -

54,815 68,762 4,594 4,883

Non-current liabilitiesBorrowings 21 1,457 2,205 1,457 2,205

Total liabilities 56,272 70,967 6,051 7,088

NET ASSETS 74,683 67,875 41,205 42,647

EQUITYCapital and reserves attributable to equity holders of the CompanyShare capital 24 40,862 40,862 40,862 40,862Other reserves 25 5,860 2,490 - -Statutory reserves 26 4,572 3,578 - -Retained earnings 7,871 7,613 343 1,785

59,165 54,543 41,205 42,647Minority interests 15,518 13,332 - -

Total equity 74,683 67,875 41,205 42,647


BALANCE SHEETSAS AT 31 DECEMBER 2008

29

Attributable to equity holders of the Company

NoteSharecapital

Other reserves

Statutory reserves

Retained earnings Total

Minority interests Total equity

$'000 $'000 $'000 $’000 $’000 $'000 $'000GroupBalance at 1 January 2008 40,862 2,490 3,578 7,613 54,543 13,332 67,875

Currency translation differences - 3,370 - - 3,370 1,109 4,479Deemed disposal of a subsidiary - - - - - (770) (770)

Net income recognised directly in equity - 3,370 - - 3,370 339 3,709Net profi t for the year - - - 1,252 1,252 1,847 3,099Total recognised income - 3,370 - 1,252 4,622 2,186 6,808

Transfer from retained profi ts to statutory reserves 26 - - 994 (994) - - -Balance at 31 December 2008 40,862 5,860 4,572 7,871 59,165 15,518 74,683

Balance at 1 January 2007 40,862 1,883 2,726 7,547 53,018 11,720 64,738

Currency translation differences - 607 - - 607 714 1,321

Net income recognised directly in equity - 607 - - 607 714 1,321Net profi t for the year - - - 2,136 2,136 1,589 3,725Total recognised income - 607 - 2,136 2,743 2,303 5,046

Transfer from retained profi ts to statutory reserves 26 - - 852 (852) - - -

Dividends paid 27 - - - (1,218) (1,218) (691) (1,909)Balance at 31 December 2007 40,862 2,490 3,578 7,613 54,543 13,332 67,875


CONSOLIDATED STATEMENT OF CHANGES IN EQUITY FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2008

30

GroupNote 2008 2007

$’000 $’000Cash fl ows from operating activities Net profi t 3,099 3,725Adjustments for: Income tax 2,559 1,075 Depreciation of property, plant and equipment 5,490 5,289 Amortisation of intangible assets 78 60 Interest expense 1,904 1,781 Interest income (240) (104) Loss from fair value adjustment of an investment property 18 - (Gain)/ loss on disposal of property, plant and equipment (375) 49 Gain on deemed disposal of a subsidiary (11) - Share of loss of an associate 619 - Foreign exchange loss 1,821 933Operating cash fl ow before working capital changes 14,962 12,808

Changes in operating assets and liabilities - inventories 568 (6,597) - trade and other receivables 6,959 (575) - other current assets 1,033 (445) - trade and other payables (12,290) 4,357 - amount due to a director - (30)Cash generated from operations 11,232 9,518Interest received 240 104Interest paid (1,904) (1,781)Income tax paid (1,465) (1,343)Net cash generated from operating activities 8,103 6,498

Cash fl ows from investing activities Proceeds from disposal of property, plant and equipment 1,199 26Purchase of property, plant and equipment (4,903) (4,122)Purchase of intangible assets (45) (127)Net cash outfl ow from deemed disposal of a subsidiary (60) -Net cash used in investing activities (3,809) (4,223)

Cash fl ows from fi nancing activities Payment of dividends to minority interests - (691)Proceeds from borrowings 39,577 23,687Repayment of borrowings (42,231) (23,046)Dividends paid during the year - (1,218)Net cash used in fi nancing activities (2,654) (1,268)

Net increase in cash and cash equivalents 1,640 1,007Effects of exchange rate changes on cash and cash equivalents 601 77Cash and cash equivalents at beginning of the fi nancial year 9,014 7,930Cash and cash equivalents at end of the fi nancial year 11 11,255 9,014


CONSOLIDATED CASH FLOW STATEMENTFOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2008

31

Deemed disposal of a subsidiary

On 31 January 2008, the Group effective equity interest in subsidiary Fujian Juan Kuang Wireharness Electric Limited (“JKE”) was diluted from 69.2% to 34.6%, resulting JKE becoming an associate of the Group.

The aggregate effects of the deemed disposal of JKE on the cashfl ows of the Group was:

Carryingamount2008$'000

Identifi able assets and liabilities

Cash and cash equivalents 60Trade and other receivables 1,388Inventories 2,712Other current assets 14Property, plant and equipment 516Total assets 4,690

Trade and other payables (1,891)Borrowings (296)Total liabilities (2,187)

Identifi able net assets 2,503Less: Minority interest (770)Identifi able net assets deemed disposal 1,733

Costs of investment in JKE 1,744

Gain on deemed disposal (11)

Net cash outfl ow on deemed disposal (60)


CONSOLIDATED CASH FLOW STATEMENTFOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2008

32

These notes form an integral part of and should be read in conjunction with the accompanying fi nancial statements.

1. GENERAL

JK Yaming International Holdings Ltd. (the “Company”) is incorporated and domiciled in Singapore. The address of its registered offi ce is 160 Paya Lebar Road, #08-03 Orion Industrial Building, Singapore 409022.

The Company is listed on the Singapore Exchange Securities Trading Limited.

The principal activity of the Company is that of an investment holding company. The principal activities of the Company’s subsidiaries and an associate are set out in Note 15 & 16 to the fi nancial statements.

2. BASIS OF PREPARATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

(i) Basis of preparation

2.1 Basis of preparation The fi nancial statements have been prepared in accordance with Singapore Financial Reporting Standards (“FRS”).

The fi nancial statements are expressed in Singapore dollars and have been prepared under the historical cost convention, except as disclosed in the accounting policies below.

The preparation of fi nancial statements in conformity with FRS requires management to exercise its judgement in the process of applying the Group’s accounting policies. It also requires the use of certain accounting estimates and assumptions. The areas involving a higher degree of judgement or complexity, or areas where assumptions and estimates are signifi cant to the fi nancial statements are disclosed in Note 4.

(ii) Summary of signifi cant accounting policies

2.2 Revenue recognition

Revenue comprises the fair value of the consideration received or receivable for the sale of goods in the ordinary course of the Group’s activities. Sales are presented net of value-added tax, rebates and discounts, and after eliminating sales within the Group.

The Group recognises revenue when the amount of revenue and related cost can be reliably measured, when it is probable that the collectability of the related receivables is reasonably assured and when the specifi c criteria for each of the Group’s activities are met as follows:

(a) Sale of goods

Revenue from the sale of goods is recognised when a Group entity has delivered the products to the customer, the customer has accepted the products and collectibility of the related recoverable is reasonably assured.

(b) Interest income

Interest income is recognised on a time proportion basis using the effective interest method.

(c) Dividend income

Dividend income is recognised when the right to receive payment is established.

NOTES TO THE FINANCIAL STATEMENTSFOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2008

33

2. BASIS OF PREPARATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT’D)

(ii) Summary of signifi cant accounting policies (cont’d)

2.2 Revenue recognition (cont’d)

(d) Rental income

Rental income from operating leases on investment properties is recognised on a straight-line basis over the lease term.

(e) Subsidy income

Subsidy income from the government is recognised at fair value where there is reasonable assurance that the subsidy will be received and all attaching conditions will be complied with.

2.3 Group accounting

(a) Subsidiaries

Subsidiaries are entities (including special purpose entities) over which the Group has power to govern the fi nancial and operating policies, generally accompanying by a shareholding giving rise to a majority of the voting rights. The existence and effect of potential voting rights that are currently exercisable or convertible are considered when assessing whether the Group controls another entity.

The purchase method of accounting is used to account for the acquisition of subsidiaries. The cost of an acquisition is measured as the fair value of the assets given, equity instruments issued or liabilities incurred or assumed at the date of exchange, plus costs directly attributable to the acquisition. Identifi able assets acquired and liabilities assumed in a business combination are measured initially at their fair values on the date of acquisition, irrespective of the extent of any minority interest. Please refer to Note 2.6 (a) for the accounting policy on goodwill on acquisition of subsidiaries.

Subsidiaries are consolidated from the date on which control is transferred to the Group. They are de-consolidated from the date on which control ceases.

In preparing the consolidated fi nancial statements, transactions, balances and unrealised gains on transactions between group companies are eliminated. Unrealised losses are also eliminated but considered an impairment indicator of the asset transferred. Accounting policies of subsidiaries have been changed where necessary to ensure consistency with the policies adopted by the Group.

Minority interests are that part of the net results of operations and of net assets of a subsidiary attributable to interests which are not owned directly or indirectly by the Group. They are measured at the minorities’ share of the fair value of the subsidiaries’ identifi able assets and liabilities at the date of acquisition by the Group and the minorities’ share of changes in equity since the date of acquisition, except when the minorities’ share of losses in a subsidiary exceeds its interest in the equity of that subsidiary. In such cases, the excess and further losses applicable to the minorities are attributed to the equity holders of the Company, unless the minorities have a binding obligation to, and are able to, make good the losses. When that subsidiary subsequently reports profi ts, the profi ts applicable to the minority are attributed to the equity holders of the Company until the minorities’ share of losses previously absorbed by the equity holders of the Company are fully recovered.

Please refer to Note 2.7 for the accounting policy on investments in subsidiaries in the separate fi nancial statements of the Company.


34



2.3 Group accounting (cont’d)

(b) Transactions with minority interest

The Group applies a policy of treating transactions with minority interests as transactions with parties external to the Group. Disposals to minority interests result in gains and losses for the Group that are recognised in the income statement. Purchases from minority interests result in goodwill, being the difference between any consideration paid and the Group’s incremental share of the carrying value of identifi able net assets of the subsidiary.

(c) Associate company

Associate company is entity over which the Group has signifi cant infl uence, but not control, and generally accompanied by a shareholding giving rise to between and including 20% and 50% of the voting rights. Investments in associated companies are accounted for in the consolidated fi nancial statements using the equity method of accounting less impairment losses.

Investments in associate company are initially recognised at cost. The cost of an acquisition is measured at the fair value of the assets given, equity instruments issued or liabilities incurred or assumed at the date of exchange, plus costs directly attributable to the acquisition.

In applying the equity method of accounting, the Group’s share of its associated companies’ post-acquisition profi ts or losses are recognised in the income statement and its share of post-acquisition movements in reserves is recognised in equity directly. These post-acquisition movements are adjusted against the carrying amount of the investment. When the Group’s share of losses in an associate company equals or exceeds its interest in the associated company, including any other unsecured non-current receivables, the Group does not recognise further losses, unless it has obligations or has made payments on behalf of the associate company.

Unrealised gains on transactions between the Group and its associated companies are eliminated to the extent of the Group’s interest in the associated companies. Unrealised losses are also eliminated unless the transaction provides evidence of an impairment of the asset transferred. Accounting policies of associate company have been changed where necessary to ensure consistency with the accounting policies adopted by the Group.

Dilution gains and losses arising from investments in associated companies are recognised in the income statement.

Please refer to Note 2.7 for the accounting policy on investment in an associate in the separate fi nancial statements of the Company.


35



2.4 Property, plant and equipment

(a) Measurement

All property, plant and equipment are stated at cost less accumulated depreciation and accumulated impairment losses.

The cost of an item of property, plant and equipment includes its purchase price and any cost that is directly attributable to bringing the asset to the location and condition necessary for it to be capable of operating in the manner intended by management. The projected cost of dismantlement, removal or restoration is also included as part of the cost of property, plant and equipment if the obligation for the dismantlement, removal or restoration is incurred as a consequence of acquiring or using the asset.

(b) Depreciation

Depreciation is calculated using a straight line method to allocate their depreciable amounts over their estimated useful lives. The estimated useful lives are as follows:

Useful lives

Freehold building 50 years Leasehold land term of lease (50 years) Leasehold buildings 20 years Plant and equipment 5 -10 years Motor vehicles 5 years Offi ce equipment 3 to 10 years

The residual values and useful lives of property, plant and equipment are reviewed, and adjusted as appropriate, at each balance sheet date. The effects at any revision are recognised in the income statement when the changes arise.

Fully depreciated assets still in use are retained in the fi nancial statements.

(c) Construction in progress

Construction in progress represents costs incurred in the construction of property, plant and equipment and other tangible assets. Cost comprises direct costs of construction incurred during the period of construction, installation and testing.

Construction in progress is transferred to property, plant and equipment when it is ready for its intended use. No depreciation is effected on construction in progress until the relevant assets are completed and are ready for its intended use or put into use.

(d) Subsequent Expenditure

Subsequent expenditure relating to property, plant and equipment that has already been recognised is added to the carrying amount of the asset when it is probable that future economic benefi ts, in excess of the originally assessed standard of performance of the existing asset, will fl ow to the Group and the cost of the item can be measured reliably. Other subsequent expenditure is recognised in the income statement when incurred.


36



2.4 Property, plant and equipment (cont’d)

(e) Disposal

On disposal of an item of property, plant and equipment, the difference between the net disposal proceeds and its carrying amount is taken to the income statement.

2.5 Investment properties

Investment properties of the Group are held for long-term rental yields and capital appreciation and are not occupied by the Group. Investment properties are initially recognised at cost, plus transaction costs.

Subsequently, investment properties are stated at fair value based on valuations by independent professional valuers on an annual basis. Changes in fair values are recognised in the income statement.

Gains or losses arising from the retirement or disposal of investment properties is determined as the difference between the disposal proceeds and the carrying amount of the asset and is recognised in the income statement.

2.6 Intangible assets

(a) Goodwill on acquisitions

Goodwill represents the excess of the cost of an acquisition over the fair value of the Group’s share of

the identifi able assets, liabilities and contingent liabilities of the acquired subsidiaries, joint ventures and associated companies at the date of acquisition.

Goodwill on subsidiaries and joint ventures is recognised separately as intangible assets and carried at cost

less accumulated impairment losses.

Goodwill on associated companies is included in the carrying amount of the investments.

Gains and losses on the disposal of subsidiaries, joint ventures and associated companies include the carrying amount of goodwill relating to the entity sold, except for goodwill arising from acquisitions prior to 1 January 2001. Such goodwill was adjusted against retained earnings in the year of acquisition and not recognised in the income statement on disposal.

(b) Patent rights

This represents costs incurred to obtain patent rights. They are stated at cost less accumulated amortisation and accumulated impairment losses.

Amortisation is calculated using the straight-line method to allocate the cost of patent rights over their estimated useful lives of 5 to 10 years.

The amortisation period and amortisation method of intangible assets other than goodwill are reviewed at least at each balance sheet date. The effects of any revision are recognised in the income statement when the changes arise.


37



2.7 Investments in subsidiaries and an associate

Investments in subsidiaries and an associate are stated at cost less accumulated impairment losses in the Company’s balance sheet.

On disposal of investments in subsidiaries and an associate, the difference between disposal proceeds and the carrying amounts of the investments are recognised in the income statement.

2.8 Impairment of non – fi nancial assets

(a) Goodwill

Goodwill is tested annually for impairment, and whichever there is indication that the goodwill may be impaired.

For the purpose of impairment testing of goodwill, goodwill is allocated to each of the Group’s cash-generating-units (CGU) expected to benefi t from synergies of the business combination.

An impairment loss is recognised in the income statement when the carrying amount of CGU, including the goodwill, exceeds the recoverable amount of the CGU. Recoverable amount of the CGU is the higher of the CGU’s fair value less cost to sell and value in use.

The total impairment loss of a CGU is allocated fi rst to reduce the carrying amount of goodwill allocated to the CGU and then to the other assets of the CGU pro-rata on the basis of the carrying amount of each asset in the CGU.

An impairment loss on goodwill is recognised in the income statement and is not reversed in a subsequent period.

(b) Intangible assets, property, plant and equipment, investments in subsidiaries and an associate

Intangible assets, property, plant and equipment and investments in subsidiaries and an associate are tested for impairment whenever there is any objective evidence or indication that these assets may be impaired. If any such indication exists, the recoverable amount (i.e. the higher of the fair value less cost to sell and value in use) of the asset is estimated to determine the amount of impairment loss.

For the purpose of impairment testing, the recoverable amount is determined on an individual asset basis unless the asset does not generate cash fl ows that are largely independent of those from other assets. If this is the case, recoverable amount is determined for the CGU to which the asset belongs.

If the recoverable amount of the asset (or CGU) is estimated to be less than its carrying amount, the carrying amount of the asset (or CGU) is reduced to its recoverable amount and impairment loss is recognised in the income statement.

The difference between the carrying amount and recoverable amount is recognised as an impairment loss in the income statement, unless the asset is carried at revalued amount, in which case, such impairment loss is treated as a revaluation decrease.


38



2.8 Impairment of non – fi nancial assets (cont’d)

(b) Intangible assets, property, plant and equipment, investments in subsidiaries and an associate (cont’d)

An impairment loss for an asset other than goodwill is reversed if, and only if, there has been a change in the estimates used to determine the assets’ recoverable amount since the last impairment loss was recognised. The carrying amount of an asset other than goodwill is increased to its revised recoverable amount, provided that this amount does not exceed the carrying amount that would have been determined (net of amortisation or depreciation) had no impairment loss been recognised for the asset in prior years.

A reversal of impairment loss for an asset other than goodwill is recognised in the income statement, unless the asset is carried at revalued amount, in which case, such reversal is treated as a revaluation increase. However, to the extent that an impairment loss on the same revalued asset was previously recognised in the income statement, a reversal of that impairment is also recognised in the income statement.

2.9 Financial assets

Financial assets are recognised on the balance sheet when, and only when, the Group becomes a party to the contractual provisions of the fi nancial instruments.

(i) Classifi cation

The Group classifi es its fi nancial assets as loans and receivables. The classifi cation depends on the purpose for which the assets were acquired. Management determines the classifi cation of its fi nancial assets at initial recognition. The designation of fi nancial assets at fair value through profi t or loss is irrevocable.

Loans and receivables are non-derivative fi nancial assets with fi xed or determinable payments that are not quoted in an active market. They are presented as current assets, except for those maturing later than 12 months after the balance sheet date which are presented as non-current assets. Loans and receivables are presented as “trade and other receivables”, “other current assets” and “cash and cash equivalents” on the balance sheet.

(ii) Recognition and derecognition

Regular way purchases and sales of fi nancial assets are recognised and derecognised on trade-date – the date on which the Group commits to purchase or sell the asset.

Financial assets are derecognised when the rights to receive cash fl ows from the fi nancial assets have expired or have been transferred and the Group has transferred substantially all risks and rewards of ownership. On disposal of a fi nancial asset, the difference between the carrying amount and the sale proceeds is recognised in the income statement. Any amount in the fair value reserve relating to that asset is transferred to the income statement.

(iii) Initial measurement

Financial assets are initially recognised at fair value plus transaction costs except for fi nancial assets at fair value through profi t or loss, which are recognised at fair value.


39



2.9 Financial assets (cont’d)

(iv) Subsequent measurement

Loans and receivable are subsequently carried at amortised cost using the effective interest method.

(v) Impairment of fi nancial assets

The Group assesses at each balance sheet date whether there is objective evidence that a fi nancial asset or a group of fi nancial assets is impaired and recognises an allowance for impairment when such evidence exists.

Signifi cant fi nancial diffi culties of the debtor, probability that the debtor will enter bankruptcy, and default or signifi cant delay in payments are objective evidence that these fi nancial assets are impaired.

The carrying amount of these assets is reduced through the use of an impairment allowance account which is calculated as the difference between the carrying amount and the present value of estimated future cash fl ows, discounted at the original effective interest rate. When the asset becomes uncollectible, it is written off against the allowance account. Subsequent recoveries of amounts previously written off are recognised against the same line item in the income statement.

The allowance for impairment loss account is reduced through the income statement in a subsequent period when the amount of impairment loss decreases and the related decrease can be objectively measured. The carrying amount of the asset previously impaired is increased to the extent that the new carrying amount does not exceed the amortised cost, had no impairment been recognised in prior periods.

2.10 Research costs

Research costs are recognised as an expense as and when incurred.

2.11 Fair value estimation of fi nancial assets and liabilities The fair values of fi nancial instruments traded in active markets (such as exchange traded and over-the-counter

securities and derivatives) are based on quoted market prices at the balance sheet date. The quoted market prices used for fi nancial assets are the current bid prices; the appropriate quoted market prices for fi nancial liabilities are the current asking prices.

The fair values of fi nancial instruments that are not traded in an active market are determined by using valuation techniques. The Group uses a variety of methods and makes assumptions that are based on market conditions existing at each balance sheet date. Where appropriate, quoted market prices or dealer quotes for similar instruments are used. Valuation techniques, such as discounted cash fl ow analyses, are also used to determine the fair values of the fi nancial instruments.

The fair values of current fi nancial assets and liabilities carried at amortised cost approximate their carrying amounts.


40



2.12 Borrowings

Borrowings are presented as current liabilities unless the Group has an unconditional right to defer settlement for at least 12 months after the balance sheet date.

Borrowings are recognised initially at fair value (net of transaction costs incurred) subsequently carried at amortised cost. Any difference between proceeds (net of transaction costs) and the redemption value is recognised in the income statement over the period of the borrowings using the effective interest method.

2.13 Trade and other payables

Trade and other payables are initially measured at fair value, and subsequently carried at amortised cost, using the effective interest method.

2.14 Borrowing costs

Borrowing costs are recognised on a time proportion basis in the income statement using the effective interest method.

2.15 Leases

When the Group is the lessee:

The Group leases certain property, plant and equipment under operating leases from non related parties.

Finance leases

Leases where the Group assumes substantially the risks and rewards incidental to ownership of the leased assets are classifi ed as fi nance leases.

The leased assets and the corresponding lease liabilities (net of fi nance charges) under fi nance leases are recognised on the balance sheet as property, plant and equipment and borrowings respectively, at the inception of the leases based on the lower of the fair value of the leased assets and the present value of the minimum lease payments.

Each lease payment is apportioned between the fi nance expense and the reduction of the outstanding lease liability. The fi nance expense is recognised in the income statement and allocated to each period during the lease term so as to achieve a constant periodic rate of interest on the remaining balance of the fi nance lease liability.


41



2.15 Leases (cont’d)

Operating leases Leases of assets where a signifi cant portion of the risks and rewards of ownership are retained by the lessor are

classifi ed as operating leases. Payments made under operating leases (net of any incentives received from the lessor) are taken to the income statement on a straight-line basis over the period of the lease.

When an operating lease is terminated before the lease period has expired, any payment required to be made to the lessor by way of penalty is recognised as an expense in the period in which termination takes place.

When the Group is the lessor:

Operating leases

Assets leased out under operating leases are included in investment properties and are stated at revalued amounts and not depreciated. Rental income (net of any incentives given to lessees) is recognised in the income statement on a straight-line basis over the lease term.

2.16 Inventories

Inventories are carried at the lower of cost and net realisable value. Cost is determined on a weighted average basis. The cost of fi nished goods and work in progress comprises raw materials, direct labour, other direct costs and related production overheads (based on normal operating capacity) but excludes borrowing costs. Net realisable value is the estimated selling price in the ordinary course of business, less the costs of completion and selling expenses.

2.17 Income taxes

Current income tax for current and prior periods is recognised at the amounts expected to be paid to or recovered from the tax authorities, using the tax rates (and tax laws) that have been enacted or substantially enacted by the balance sheet date.

Deferred income tax is recognised for all deductible taxable temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the fi nancial statements except when the deferred income tax assets/liabilities arise from the initial recognition of an asset or liability in a transaction that is not a business combination and at the time of the transaction, affects neither accounting nor taxable profi t or loss.

Deferred income tax liability is recognised on temporary differences arising on investments in subsidiaries, except where the timing of the reversal of the temporary difference can be controlled and it is probable that the temporary difference will not reverse in the foreseeable future.

Deferred income tax asset is recognised to the extent that it is probable that future taxable profi t will be available against which the deductible temporary differences can be utilised.


42



2.17 Income taxes (cont’d)

Deferred income tax is measured at:

(i) at the tax rates that are expected to apply when the related deferred income tax asset is realised or the deferred income tax liability is settled, based on tax rates (and tax laws) that have been enacted or substantially enacted by the balance sheet date; and

(ii) based on the tax consequence that would follow from the manner in which the Group expects, at the balance sheet date, to recover or settle the carrying amounts of its assets and liabilities.

Current and deferred income taxes are recognised as income or expense in the income statement, except to the extent that the tax arises from a business combination or a transaction which is recognised directly in equity. Deferred tax on temporary differences arising from the revaluation gains and losses on land and buildings are charged or credited directly to equity in the same period the temporary differences arise. Deferred tax arising from a business combination is adjusted against goodwill on acquisition.

2.18 Provisions

Provisions are recognised when the Group has a present legal or constructive obligation as a result of past events; it is more likely than not that an outfl ow of resources will be required to settle the obligation and the amount has been reliably estimated.

Provisions are measured at the present value of the expenditure expected to be required to settle the obligation using a pre-tax discount rate that refl ects the current market assessment of the time value of money and the risks specifi c to the obligation. The increase in the provision due to the passage of time is recognised in the income statement as fi nance expense.

Changes in the estimated timing or amount of the expenditure or discount rate are recognised in the income statement when the changes arise.

2.19 Employee compensation

Employee leave entitlement

Employee entitlements to annual leave are recognised when they accrue to employees. A provision is made for the estimated liability for annual leave and long-service leave as a result of services rendered by employees up to the balance sheet date.

Defi ned contribution plan

Defi ned contribution plans are post-employment benefi t plans under which the Group pays fi xed contributions into separate entities such as Central Provident Fund (“CPF”) and social security bureaus in PRC as described below, and will have no legal or constructive obligation to pay further contributions if any of the funds does not hold suffi cient assets to pay all employee benefi ts relating to employee service in the current and preceding fi nancial year. The Group’s contribution to defi ned contribution plans are recognised in the fi nancial year to which they relate.

The Group participates in retirement insurance scheme organised by the social security bureau in the PRC pursuant to the relevant provisions. The subsidiaries in PRC are required to make monthly contribution in respect of the above insurance schemes to the PRC social security bureau based on the monthly salaries of its employees. The Group has no further liabilities other than the above defi ned contribution. The Group’s contributions under the schemes are recognised in the fi nancial year to which they relate.


43



2.20 Currency translation

(a) Functional and presentation currency

Items included in the fi nancial statements of each entity in the Group are measured using the currency of the primary economic environment in which the entity operates (“the functional currency”). The fi nancial statements are presented in Singapore dollars, which is the functional and presentation currency of the Company.

(b) Transactions and balances

Transactions in a currency other than the functional currency (“foreign currency”) are translated into the functional currency using the exchange rates prevailing at the dates of the transactions. Currency translation differences from the settlement of such transactions and from the translation at the closing exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in the income statement, except for currency translation differences on net investment in foreign operations, which are included in the currency translation reserve within equity in the consolidated fi nancial statements and transferred to the income statement as part of the gain or loss on disposal of the foreign operations.

Non-monetary items that are measured at fair values in foreign currencies are translated using the exchange rates at the date when the fair values are determined.

(c) Translation of Group entities’ fi nancial statements

The results and fi nancial position of all the group entities (none of which has the currency of a hyperinfl ationary economy) that have a functional currency different from Singapore Dollars are translated into Singapore Dollars as follows:

(i) Assets and liabilities are translated at the closing exchange rate at the date of that balance sheet;

(ii) Income and expenses are translated at average exchange rates (unless this average is not a reasonable approximation of the cumulative effect of the rates prevailing on the transaction dates, in which case income and expenses are translated at the dates of the transactions); and

(iii) All resulting exchange differences are recognised in the foreign currency translation reserve within equity.

Goodwill and fair value adjustments arising on the acquisition of a foreign entity on or after 1 January 2005 are treated as assets and liabilities of the foreign entity and translated at the closing rate. For acquisitions prior to 1 January 2005, the exchange rates at the dates of acquisition are used.

2.21 Segment reporting

A business segment is a distinguishable component of the Group engaged in providing products or services that are subject to risks and returns that are different from those of other business segments. A geographical segment is a distinguishable component of the Group engaged in providing products or services within a particular economic environment that is subject to risks and returns that are different from those of segments operating in other economic environments.


44



2.22 Cash and cash equivalents

For the purpose of presentation in the consolidated cash fl ow statement, cash and cash equivalents include cash on hand and deposits with fi nancial institutions and bank overdrafts. Bank overdrafts are presented as borrowings in current liabilities on the balance sheet.

2.23 Share capital Ordinary shares are classifi ed as equity. Incremental costs directly attributable to the issuance of new ordinary

shares are deducted against the share capital account.

2.24 Dividend

Interim dividends are recorded in the fi nancial year in which they are declared payable. Final dividends are recorded in the fi nancial year in which the dividends are approved by the shareholders.

3. ADOPTION OF NEW AND REVISED SINGAPORE FINANCIAL REPORTING STANDARDS

On 1 January 2008, the Group adopted the new or revised FRS and Interpretations to FRS (INT FRS) that are mandatory for application from that date. Changes to the Group’s accounting policies have been made as required, in accordance with the relevant transitional provisions in the respective FRS and INT FRS.

The new or revised FRS and INT FRS are not relevant to the Group and did not result in any substantial changes to the Group’s accounting policies nor any signifi cant impact on these fi nancial statements.

The accounting policies have been consistently applied by the Group and the Company and are consistent with those used in the previous period presented in these fi nancial statements


45

4. CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS

Critical accounting estimates and assumptions The Group makes estimates and assumptions concerning the future. The resulting accounting estimates will, by defi nition,

seldom equal the related actual results. The estimates and assumptions that have a signifi cant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next fi nancial year are discussed below.

Impairment and uncollectibility of trade receivables

The Group follows the guidance of FRS 39 (revised 2007) in determining when trade receivables are impaired. This determination requires signifi cant judgment. The Group evaluates, among other factors, signifi cant fi nancial diffi culty of the debtor, adverse changes in the collection status and changes in industry conditions that affect the debtor.

Future cash fl ows of trade receivables that are collectively evaluated for impairment are estimated on the basis of historical loss experience for debts with similar credit risk characteristics. The methodology and assumptions used for estimating future cash fl ows are reviewed regularly to reduce any differences between loss estimates and actual loss experience.

Impairment loss amounted to approximately $2,796,000 (2007 : $309,000) was made during the year. The carrying

amounts of trade receivables as at 31 December 2008 was approximately $26,401,000 (2007 : $35,812,000).

5. REVENUE AND OTHER INCOME – (NET)

Group2008 2007$’000 $’000

Sale of goods 177,482 158,076Other income – net: - Subsidy income 1,032 214 - Interest income 240 104 - Gain/(loss) on disposal of property, plant and equipment 375 (49) - Gain on deemed disposal of a subsidiary 11 - - Rental income from investment properties 163 151 - Loss from fair value adjustment of an investment property (Note 18) (18) - - Foreign exchange loss - net (362) (750) - Sale of materials 247 770 - Others (150) 187Other income – net 1,538 627

179,020 158,703


46

6. EXPENSES BY NATURE

Group2008 2007$’000 $’000

Purchases of raw materials, fi nished goods and consumables 131,909 129,652Amortisation of intangible assets (Note 19(b)) 78 60Depreciation of property, plant and equipment (Note 17) 5,490 5,289Auditor’s remuneration paid/payable to- Auditor of the Company 160 130- Other auditors 35 28Employee compensation (Note 8) 14,462 13,117Impairment loss of trade receivables 2,796 309Impairment loss of other receivables 266 -Prepayments to suppliers written off 329 -Staff advances written off 59 -Legal expense 1,267 1,000Rental on operating leases 225 181Research expense 849 593Allowance for inventories write-down 50 -Utilities expenses 1,807 1,553Travelling and transportation expense 2,190 1,040Sub-contracting charges 1,856 1,442Other expenses 3,659 3,845Movements in inventories of raw materials, work-in-progress and fi nished goods 3,279 (6,596)Total cost of sales, distribution and marketing costs and administrative expenses 170,766 151,643

7. FINANCE COSTS

Group2008 2007$’000 $’000

Interest expenses on bank overdraft and loans 1,897 1,774Foreign exchange loss – (net) 73 479Interest expenses on fi nance leases 7 7

1,977 2,260


47

8. EMPLOYEE COMPENSATION

Group2008 2007$’000 $’000

Wages and salaries 11,974 10,998Employer’s contribution to defi ned contribution plans including Central Provident Fund and PRC retirement insurance scheme 2,488 2,119

14,462 13,117

9. INCOME TAX

(a) Income tax expense

Group2008 2007$’000 $’000

Tax expense attributable to profi t is made up of:Current income tax- Foreign 2,545 1,075

2,545 1,075Under provision in preceding fi nancial yearsCurrent income tax 14 -

2,559 1,075

The Group’s operations are mainly in the People’s Republic of China (“PRC”). The tax expense on the profi t differs from the amount that would arise using the PRC income tax rate of 25% is as explained below:

Group2008 2007$’000 $’000

Profi t before income tax 5,658 4,800

Tax calculated at a tax rate of 25% (2007: 33%) 1,415 1,584Effect of preferential tax rate (381) (736)Expenses not deductible for tax purposes 634 7Income not subject to tax - (70)Deferred tax benefi t not recognised 877 290Tax charge 2,545 1,075


48

9. INCOME TAX (CONT’D)

(a) Income tax expense (cont’d)

Pursuant to the Income Tax Law of the PRC concerning Foreign Investment Enterprises and Foreign Enterprises and various local income tax laws (the “Income Tax Laws”), the subsidiary companies in PRC are subject to statutory income tax rate of 25% [2007 :33% (30% state income tax plus 3% local income tax)] unless the enterprise is located in specially designated region or cities for which more favorable effective tax rates apply. Accordingly, certain subsidiaries enjoy concessionary enterprise income tax rates between 12.5% and 15%. In accordance with the Income Tax Laws, qualifi ed enterprises will be exempted from taxation for the fi rst two year commencing from the fi rst profi table year, and a 50% reduction for the three years thereafter.

(b) Deferred income tax assets are recognised for tax losses carried forward to the extent that realisation of the related tax benefi ts through future taxable profi ts is probable. The Group had unrecognised and unutilised tax losses of approximately $5,915,000 (2007 : $5,392,000) at balance sheet date which can be carried forward and used to set off against future taxable income subject to meeting certain statutory requirements by those companies with unrecognised tax losses in their respective countries of incorporation. For tax losses arising from a company incorporated in PRC, tax losses will expire 5 years after the company becomes profi table.

(c) Movements in current income tax liabilities

Group Company2008 2007 2008 2007$’000 $’000 $’000 $’000

Balance at beginning of fi nancial year 544 785 - -Currency translation differences 77 27 - -Income tax paid (1,465) (1,343) - -Tax expense on profi t for the current fi nancial year 2,559 1,075 - -Balance at end of fi nancial year 1,715 544 - -

10. EARNINGS PER SHARE

Earnings per share is calculated by dividing the net profi t attributable to equity holders of the Company by the weighted average number of ordinary shares outstanding during the fi nancial year.

Group2008 2007

Net profi t attributable to equity holders of the Company ($’000) 1,252 2,136

Weighted average number of ordinary shares in issue for basic earnings per share (‘000) 202,948 202,948

Basic and diluted earnings per share 0.62 cents 1.05 cents There are no dilutive instruments in existence as at 31 December 2008 (2007 : nil).


49

11. CASH AND CASH EQUIVALENTS

Group Company2008 2007 2008 2007$’000 $’000 $’000 $’000

Cash at bank and on hand 11,653 9,452 - -

Included in cash and cash equivalents of approximately $11,642,000 as at 31 December 2008 (2007 : $9,380,000) were placed with banks in the PRC. The remittance of these funds out of the PRC is subject to the exchange restrictions imposed by the PRC government.

For the purpose of presenting the consolidated cash fl ow statement, the consolidated cash and cash equivalents comprise the following:

Group2008 2007$’000 $’000

Cash at bank and on hand (as above) 11,653 9,452Less: Bank overdraft (Note 21) (398) (438)

11,255 9,014

12. TRADE AND OTHER RECEIVABLES

Group Company2008 2007 2008 2007$’000 $’000 $’000 $’000

Trade receivables - related parties 7,687 13,874 - - - third parties 28,525 28,854 - -

36,212 42,728 - - Less: Allowance for impairment of trade receivables (9,811) (6,916)Trade receivables - net 26,401 35,812 - -

Other receivables 2,501 1,136 - - Less: Allowance for impairment of other receivables (276) - - - Other receivables - net 2,225 1,136 - -

Amount due from subsidiaries - non-trade - - 747 1,095 Less: Allowance for impairment of amount due from a subsidiary - - (232) - Amount due from subsidiaries - non-trade - net - - 515 1,095

Amount due from an associate - non-trade - - 80 - Less: Allowance for impairment of amount due from an associate - - (80) - Amount due from an associate - non-trade - net - - - - Note receivables 648 559 - - Tax recoverable 36 152 - -

29,310 37,659 515 1,095


50

12. TRADE AND OTHER RECEIVABLES (CONT’D)

The movement in the allowance for impairment of trade receivables is as follows:

Group

2008 2007

$’000 $’000

Balance at beginning of year 6,916 6,595Current year charge 2,796 309

Translation differences 99 12

Balance at end of year 9,811 6,916

The movement in the allowance for impairment of other receivables is as follows:

Group

2008 2007

$’000 $’000

Current year charge 266 -

Translation differences 10 -

Balance at end of year 276 -

The movement in the allowance for impairment of amount due from a subsidiary - non trade is as follows:

Company

2008 2007

$’000 $’000

Current year charge 232 - Balance at end of year 232 -

The movement in the allowance for impairment of amount due from an associate - non trade is as follows:

Company

2008 2007

$’000 $’000

Current year charge 80 - Balance at end of year 80 -

Concentrations of credit risk with respect to trade receivables are limited due to the Group’s large number of customers with a variety of end markets in which they sell. As such, management believes that there is no anticipated additional credit risk beyond the amount of allowance for impairment made in the Group’s trade receivables.

Amounts due from subsidiaries - non-trade are unsecured, interest-free and are repayable on demand.


51

13. INVENTORIES

Group2008 2007$’000 $’000

Raw materials 16,378 17,729Work-in-progress 4,370 4,298Finished goods 10,146 12,339

30,894 34,366Less: Allowance for inventories write down (141) (334)

30,753 34,032

The movement in allowance for inventories write down is as follows:

Group2008 2007$’000 $’000

Balance at beginning of year 334 334Current year charge 50 -Deemed disposal of a subsidiary (249) -Translation differences 6 -Balance at end of year 141 334

The cost of inventories recognised as expense and included in ‘cost of sales’ amounted to $135,188,000 (2007 : $123,056,000).

14. OTHER CURRENT ASSETS

Group Company2008 2007 2008 2007$’000 $’000 $’000 $’000

Prepayments to suppliers 1,895 2,808 - -Prepaid expenses 97 231 6 6

1,992 3,039 6 6


52

15. INVESTMENTS IN SUBSIDIARIES

Company2008 2007$’000 $’000

Equity investments at cost 44,924 47,042Impairment loss (650) -

44,274 47,042

The movement in the impairment loss in investments in subsidiaries is as follows:

Company2008 2007$’000 $’000

Current year charge 650 -Balance at end of year 650 -

Details of the subsidiaries at the end of the fi nancial year are as follows:

Country of Percentage of

Name of companies Principal activitiesincorporation/

businessequity held

by the Group2008 2007

% %Subsidiaries held by the Company

+ Fujian Juan Kuang Yaming Electric Limited (“FJKYM”)

Manufacture and sale of ballast, ignitors, capacitors, electrical lighting products, fi xtures and accessories

PRC 96.9 96.9

+ Shanghai Juan Kuang Lighting Fixture Co. Ltd

Manufacture of electrical lighting products, fi xtures and accessories.

PRC 99.1 99.1

+ Fujian Juan Kuang Metal Industries Co., Ltd

Manufacture and sale of safedeposit boxes

PRC 98.9 98.9

# JKYM Trading Pte Ltd Sales and distribution of safe deposit boxes Singapore 100.0 100.0


53

15. INVESTMENTS IN SUBSIDIARIES (CON’D)


Name of companies Principal activitiesincorporation/

businessequity held


% %Subsidiaries of FJKYM

+ Shanghai Juan Kuang Lighting Co., Ltd

Manufacture and sale of lighting products PRC 78.3 78.3

+ Shanghai JK & YMInternational Trade Ltd

Trading of lighting products PRC 87.2 87.2

+ Fujian J.K. Wiring Systems Co., Ltd.

Process and sale of wire harness products PRC 53.3 53.3

+ Fujian Juan Kuang Wireharness Electric Limited

Manufacture and sale of wire harness products

PRC - 69.2

+ Fujian Min Hang Electronics Co., Ltd

Manufacture, assemble and sales of semiconductors

PRC 55.6 55.6

+ Shanghai Yuan Ya Lighting Engineering Co., Ltd

Design, consulting and sale of electrical lighting products and accessories

PRC 96.9 96.9

+ Anhui Juan Kuang Electric Co., Ltd

Manufacture and sale of capacitors and related electrical lighting products.

PRC 88.0 88.0

+ Audited by Local Auditors, PRC for local statutory reporting purposes. LTC LLP performed the audit for Group consolidation purposes.

# Audited by LTC LLP, Singapore.

16. INVESTMENT IN AN ASSOCIATE

Group Company2008 2007 2008 2007$’000 $’000 $’000 $’000

Equity investment at cost 1,744 - 2,118 -Currency translation differences 123 - - -

Share of loss of associate (619) - - -Impairment loss - - (1,109) -

1,248 - 1,009 -


54

16. INVESTMENT IN AN ASSOCIATE (CONT’D)

The movement in the impairment loss in investment in an associate is as follows:

Company2008 2007$’000 $’000

Current year charge 1,109 -Balance at end of year 1,109 -

The summarised fi nancial information of an associate equity accounted for is as follows:

Group2008 2007$’000 $’000

Assets 6,571 -Liabilities 2,101 -Net Assets 4,470 -Share of Group’s net assets of associate 1,548 -Revenue 2,165 -Net loss for the year 1,816 -Group share of associate net loss 619

Details of the associate at the end of the fi nancial year are as follow:


Name of company Principal activitiesincorporation/

businessequity held


% %

+ Fujian Juan KuangWireharness Electric Limited

Manufacture and sale of wire harness products

PRC 34.6 -

+ Audited by Local Auditor, PRC for local statutory reporting purposes.

The Company has on 20 December 2007 entered into a joint-venture agreement with Henan Tianhai Electric Co.,Ltd“(HTECL”) a PRC wholly owned subsidiary of China Auto Electronics Group Limited, a company listed on the SGX, whereby HTECL invested S$2,628,000 (equivalent to US$1,800,000) in cash into the capital of Fujian Juan Kuang Wire harness Electric Limited (“JKE”) to fund the operational expansion and working capital of JKE.

Upon the completion of the joint venture agreement on 31 January 2008, the registered capital of JKE was increased from S$4,261,000 (equivalent to US$3,000,000) to S$6,818,000 (equivalent to US$4,800,000) and the effective equity interest of the Group in JKE was diluted from 69.2% to 34.6%, resulting JKE becoming an associate of the Group.


55

17. PROPERTY, PLANT AND EQUIPMENT

Leaseholdland and Freehold Plant and Motor Offi ce Constructionbuildings building equipment vehicles equipment In progress Total

$’000 $’000 $’000 $’000 $’000 $’000 $’000GroupCost As at 1 January 2008 30,349 1,260 27,427 2,681 9,540 1,055 72,312

Additions 293 - 1,102 678 536 2,294 4,903

Transfers 233 - 10 172 507 (922) -

Disposals (1,133) - (65) (461) (160) - (1,819) Deemed disposal of a subsidiary - - (1,317) (89) (199) - (1,605)

Translation differences 1,924 - 1,682 137 607 122 4,472

As at 31 December 2008 31,666 1,260 28,839 3,118 10,831 2,549 78,263

Accumulated depreciation and accumulated impairment lossesAs at 1 January 2008 6,172 50 12,274 1,810 5,324 - 25,630

Depreciation charge 1,574 25 2,439 287 1,165 - 5,490

Disposals (465) - (26) (364) (140) - (995)

Deemed disposal of a subsidiary - - (888) (72) (129) - (1,089)

Translation differences 383 - 730 114 441 - 1,668

As at 31 December 2008 7,664 75 14,529 1,775 6,661 - 30,704

Net book value 31 December 2008 24,002 1,185 14,310 1,343 4,170 2,549 47,559

Cost As at 1 January 2007 29,110 1,260 25,467 2,669 8,322 1,063 67,891

Additions 326 - 1,028 66 841 1,861 4,122

Transfers 625 - 740 - 480 (1,845) -

Disposals - - (81) (97) (184) (35) (397)

Translation differences 288 - 273 43 81 11 696

As at 31 December 2007 30,349 1,260 27,427 2,681 9,540 1,055 72,312

Accumulated depreciation and accumulated impairment lossesAs at 1 January 2007 4,700 25 9,726 1,565 4,393 - 20,409

Depreciation charge 1,425 25 2,490 290 1,059 - 5,289

Disposals - - (65) (59) (164) - (288)Translation differences 47 - 123 14 36 - 220

As at 31 December 2007 6,172 50 12,274 1,810 5,324 - 25,630

Net book value 31 December 2007 24,177 1,210 15,153 871 4,216 1,055 46,682

(a) The carrying amount of motor vehicles held under fi nance leases at 31 December 2008 amounted to $131,000(2007 : $164,000) (Note 22).

(b) As at 31 December 2008, the Group has not obtained ownership certifi cates of piece of land at Cangshan Zone of Fuzhou High-Tech Park, 1 Gaoshan Road, Cangsha District, Fuzhou, PRC with a net book value of approximately $1,840,000 (RMB 8,724,000) 2007: $1,814,000 (RMB 9,154,000). The Group is still in the process of registering with the relevant authorities the ownership of this building and land.


56

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

(c) Bank loans are secured on properties and land use rights of the Group with carrying amounts of $3,523,000 (RMB16,705,000) and $1,283,000 (RMB6,082,000) respectively (2007 : $2,122,000 (RMB10,707,000) and $417,000 (RMB2,102,000) respectively (Note 21).

(d) Bank overdraft and bank loans are secured on freehold building of the Group with carrying amount of S$1,185,000(2007 : S$1,260,000) (Note 21).

Freehold Motor Offi cebuilding vehicles equipment Total$’000 $’000 $’000 $’000

CompanyCostAt 1 January 2008 1,260 328 323 1,911Additions - - - -At 31 December 2008 1,260 328 323 1,911

Accumulated depreciationAt 1 January 2008 - 164 155 319Depreciation charge 75 33 32 140At 31 December 2008 75 197 187 459

Net book valueAt 31 December 2008 1,185 131 136 1,452

CostAt 1 January 2007 1,260 328 322 1,910Additions - - 1 1At 31 December 2007 1,260 328 323 1,911

Accumulated depreciationAt 1 January 2007 - 131 122 253Depreciation charge 33 33 66At 31 December 2007 - 164 155 319

Net book valueAt 31 December 2007 1,260 164 168 1,592

(a) As at 31 December 2008, the freehold building of the Company with carrying amount of S$1,185,000 (2007 : S$1,260,000) has been pledged as security for bank overdraft and bank loans obtained (Note 21).

(b) The carrying amount of motor vehicles held under fi nance leases at 31 December 2008 amounted to $131,000 (2007 : $164,000) (Note 21).

18. INVESTMENT PROPERTIES

Group2008 2007$’000 $’000

Balance at beginning of fi nancial year 7,237 7,317Loss from fair value adjustment of an investment property (Note 5) (18) -Translation differences 463 (80)Balance at end of fi nancial year 7,682 7,237


57

18. INVESTMENT PROPERTIES (CONT’D)

Investment properties were valued annually at balance sheet date by the directors based on professional external valuations. Valuations were made on the basis of open market value. It is the intention of the directors to hold the investment properties for long term.

The Group’s revaluation loss was included in “other income – net” in the income statement.

Investment properties are leased to non-related parties under operating leases (Note 28).

These investment properties are located in PRC and the remittance of income and proceeds of disposal from these investment properties out of the PRC, is subject to the exchange restrictions imposed by the PRC government.

The following amounts are recognised in the income statement:

Group2008 2007$’000 $’000

Rental income (Note 5) 163 151Property tax and direct operating expenses arising from investment properties that generated

rental income (111) (102)

The details of the Group’s investment properties are as follows:

Investment Properties Description Tenure of landIndependent

ValuerValuation

date(1) 47 shop units on

level 1 and 52 shop units on level 2 of Aofeng Gardens, 271 Paiwei Road, Taijiang District, Fuzhou Province, China.

(Note)

1-102, 1-104, 1-105, 1-107, 1-109 to 1-112,1-114, 1-116 to 1-117, 1-119 to 1-144, 1-146 to 1-147 of Tower Nos.1 & 2

1-201 to 1-252 of Tower Nos. 1 & 22-102 to 2-103, 2-109, 2-111 to 2-112,2-120, 2-129 to 2-130 of Tower Nos. 3 & 4 of Aofeng Gardens, with approximate gross fl oor area of 3708 square meters.

40 years lease from 17 October

1995

DTZ Debenham Tie Leung Limited

31 December 2008

(2) 9C Kaixing Building.No. 35 Ri Jing Road, Waigaoqiao Free Trade Zone, Shanghai 200131, China.

One unit of offi ce space with a gross area of 904 square meters.

55 years lease from 21 May

1997

Shanghai Xinda Valuation Co.

Limited

12 January 2009

Note: The Group is still in the process of registering with the relevant authorities the ownership of the investment properties shown as (1), according to legal opinions obtained by the Directors, the Group is the legal owner of the property. The property can only be transferred or mortgaged when the Group has obtained the relevant ownership certifi cates.


58

19. INTANGIBLE ASSETS

Group2008 2007$’000 $’000

Goodwill arising on consolidation 302 283Patent rights 456 458

758 741

(a) Goodwill arising on consolidation

Group2008 2007$’000 $’000

CostBalance at beginning of the fi nancial year 283 281Currency translation differences 19 2Balance at end of the fi nancial year 302 283

Net book value 302 283

Impairment tests for goodwill

Goodwill is allocated to the Group’s cash-generating units (“CGUs”) identifi ed according to countries of operation and business segments.

A segment-level summary of the goodwill allocation is as follows:

Group2008 2007

Electric lighting products Total

Electric lighting products Total

$'000 $'000 $'000 $'000

People's Republic of China ("PRC") 302 302 283 283

The recoverable amount of CGU was determined based on value-in-use. Cash fl ow projections used in the value-in-use calculations were based on profi t forecast determined by the management. Perpetuity cash fl ows has been determined using the estimated growth rate stated below over the remaining useful lives of the CGU.

Key assumptions used for value-in-use calculations:

Electric lighting productsPRC

Growth rate (i) 3%Infl ation rate (ii) 5%Discount rate (iii) 5.5%

(i) Estimated annual growth rate. (ii) Infl ation rate of the operation segment. (iii) Pre-tax discounted rate applied to the pre-tax cash fl ow projections.

These assumptions were used for the analysis of each CGU within the operation and business segment. Management estimated an annual growth rate relating to the operation and business segment and the discount rate used were pre-tax and refl ected specifi c risk relating to the business segment.

The management is in the view that no impairment on goodwill is required.


59

19. INTANGIBLE ASSETS (CONT’D)

(b) Patent rights

Group2008 2007$’000 $’000

Balance at beginning of fi nancial year 458 395Acquired during the fi nancial year 45 127Amortisation charge (Note 6) (78) (60)Translation differences 31 (4)Balance at end of fi nancial year 456 458

Cost 965 889Accumulated amortisation (509) (431)Net book value 456 458

20. TRADE AND OTHER PAYABLES

Group Company 2008 2007 2008 2007$’000 $’000 $’000 $’000

Trade payables to: - Third parties 15,413 20,448 - - - Related parties 3,644 10,083 - -

19,057 30,531

Note payables 3,905 4,775 - -Receipts in advance from customers 1,328 1,147 - -Accruals for operating expenses 722 938 581 820Other payables 3,529 5,345 - -Staff bonus and welfare fund (Note A) 446 441 - -

28,987 43,177 581 820

Note A: Pursuant to the relevant laws and regulations in the PRC for foreign investment enterprises, appropriations to staff bonus and welfare fund are made from subsidiaries’ profi ts after taxation as reported in the PRC statutory accounts, which are determined in accordance with the PRC accounting standards and regulations applicable to these subsidiaries and classifi ed as part of reserves in the books of the subsidiaries. Appropriations of this fund is determined at the discretion of the Board of Directors of each subsidiary. Due to their nature, the amounts are classifi ed as other liabilities in the consolidated balance sheet and correspondingly debited to staff cost in the consolidated income statement.


60

21. BORROWINGS

Group Company2008 2007 2008 2007$’000 $’000 $’000 $’000

CurrentBank overdraft secured by Group’s freehold building (Note 17d) 398 438 398 438Bank loans – Secured by Group’s properties and land use rights

(Note 17c) and freehold building (Note 17d) 4,831 3,166 687 687 – Secured by a related party guarantee (a) - 5,600 - - – Unsecured 18,673 15,636 2,886 2,896Finance lease liabilities (Note b & 22) 42 42 42 42

23,944 24,882 4,013 4,063

Non-currentBank loans – Secured by Group’s freehold building (Note 17d) 1,433 2,138 1,433 2,138Finance lease liabilities (Note b & 22) 24 67 24 67

1,457 2,205 1,457 2,20525,401 27,087 5,470 6,268

(a) As at 31 December 2008, unsecured bank loans of the Group of approximately nil [2007 : $5,600,000 (RMB28,000,000)] were guaranteed by Nanping City Electric Equipment Factory, in which one of the directors of the Company has an equity interest.

(b) Finance lease liabilities of the Group and the Company are secured by the rights to the leased motor vehicles (Note 17a), which will revert to the lessor in the event of default by the Group and the Company.

(c) Maturity of non-current borrowings

Maturity of non-current borrowings is as follows:

Group Company2008 2007 2008 2007$’000 $’000 $’000 $’000

Within 1 year 711 730 711 730Between 2 and 5 years 110 802 110 802Over 5 years 636 673 636 673

1,457 2,205 1,457 2,205


61

21. BORROWINGS (CONT’D)

(d) Interest rate risk

The weighted average effective interest rates of total borrowings at the balance sheet date are as follows:

2008 2007SGD RMB Others SGD RMB Others

GroupBank overdraft 5.25% - - 5.25% - -Bank loans 3.74% 6.83% 4.47% 4.61% 6.66% 3.24%Finance lease liabilities 4.44% - - 4.44% - -

CompanyBank overdraft 5.25% - - 5.25% - -Bank loans 3.74% - 6.62% 4.61% - 7.71%Finance lease liabilities 4.44% - - 4.44% - -

The exposure of borrowings to interest rate risks, categorised by the earlier of contractual repricing or maturity date, are as follows:

Group

Variable rates Fixed ratesLess than6 months

6 to 12months

Over1 year

Less than6 months

6 to 12months

Over1 year Total

$’000 $’000 $’000 $’000 $’000 $’000 $’000

At 31 December 2008 3,023 4,008 - 440 16,474 1,456 25,401

At 31 December 2007 4,463 2,540 - 7,220 10,659 2,205 27,087 Company

Variable rates Fixed ratesLess than6 months

6 to 12months

Over1 years

Less than6 months

6 to 12months

Over1 years Total

$’000 $’000 $’000 $’000 $’000 $’000 $’000

At 31 December 2008 2,886 - - 440 687 1,457 5,470

At 31 December 2007 2,896 - - 481 686 2,205 6,268


62

22. FINANCE LEASE LIABILITIES

Group Company2008 2007 2008 2007$’000 $’000 $’000 $’000

Minimum lease payments due: - Not later than one year 49 49 49 49 - Between two and fi ve years 27 77 27 77

76 126 76 126Less: Future fi nance charges (10) (17) (10) (17)Present value of minimum lease payments 66 109 66 109

The present value of minimum lease payments is analysed as follows:

Group Company2008 2007 2008 2007$’000 $’000 $’000 $’000

Not later than one year (Note 21) 42 42 42 42

Later than one year (Note 21) - Between two and fi ve years 24 67 24 67

66 109 66 109

It is the Group’s policy to acquire certain of its plant and equipment under fi nance lease arrangements. The lease term is 7 years. All leases are in a fi xed repayment basis.

23. DEFERRED INCOME TAXES

Group2008 2007$'000 $'000

Deferred income tax liabilities: - to be settled within one year 169 159

The movement in the deferred income tax liabilities during the fi nancial year is as follows:

The Group Deferred income tax liabilities

Group $’000

2008Beginning of fi nancial year 159Currency translation differences 10End of fi nancial year 169

2007Beginning of fi nancial year 157Currency translation differences 2End of fi nancial year 159


63

24. SHARE CAPITAL

Group and Company2008 2007 2008 2007

Number of ordinary shares('000) (’000) $’000 $’000

Issued and paid-up capitalBeginning and end of fi nancial year 202,948 202,948 40,862 40,862

All issued shares are fully paid.

25. OTHER RESERVES

Group2008 2007$’000 $’000

(a) Comprise of:Asset revaluation reserve 569 569Currency translation reserve (1,081) (4,451)Other reserve 6,372 6,372

5,860 2,490

(b) Movements: Group2008 2007$’000 $’000

(i) Asset revaluation reserve Beginning and end of fi nancial year 569 569

(ii) Currency translation reserve Beginning of fi nancial year (4,451) (5,058) Net currency translation differences 4,479 1,321 Minority interest (1,109) (714) End of fi nancial year (1,081) (4,451)

(iii) Other reserve Beginning and end of fi nancial year 6,372 6,372

Other reserve represents reserve arising from restructuring exercise in 2001 as a result of listing of the Company.


64

26. STATUTORY RESERVES

Group2008 2007$’000 $’000

Enterprise expansion fund 2,350 2,105Reserve fund 2,222 1,473

4,572 3,578

In accordance with the “Law of the PRC on Joint Ventures Using Chinese and Foreign Investment” and the Articles of Association of the subsidiaries, appropriations from net profi t should be transferred to the Reserve Fund and the Enterprise Expansion Fund, after offsetting accumulated losses from prior years, and before profi t distributions to shareholders. The percentages to be transferred to the Reserve Fund and the Enterprise Expansion Fund are determined by the Board of Directors of the subsidiaries. The transfer to these reserves must be made before profi t distributions to shareholders.

In obtaining approval from the Board of Directors of the subsidiaries, the Enterprise Expansion Fund can be used to expand production capacity or to increase capital, and the Reserve Fund can be used to offset accumulated losses or to increase capital.

Group2008 2007$’000 $’000

Movements in statutory reserves

Enterprise expansion fundBalance at beginning of fi nancial year 2,105 1,535Transfer from retained earnings 245 570Balance at end of fi nancial year 2,350 2,105

Reserve fundBalance at beginning of fi nancial year 1,473 1,191Transfer from retained earnings 749 282Balance at end of fi nancial year 2,222 1,473

27. DIVIDENDS

Company2008 2007$’000 $’000

Ordinary dividends paid or proposedFinal exempt (one-tier) dividend paid in respect of the previous fi nancial year of nil (2006 : 0.6 cents) per share. - 1,218

At the Annual General Meeting on 24 April 2009, no dividend will be recommended for distribution for year ended

31 December 2008.


65

28. COMMITMENTS

(a) Operating lease commitments – where the Group is a lessee

The Group leases factories under non-cancellable operating lease agreements. The leases have varying terms, escalation clauses and renewal rights.

The future minimum lease payments for properties under non-cancellable operating leases contracted for at the balance sheet date but not recognised as liabilities are analysed as follows:

Group2008 2007$’000 $’000

Not later than one year 85 191Between two and fi ve year - 354

85 545

(b) Operating lease commitments – where the Group is a lessor

The future minimum lease payments receivable under non-cancellable operating leases contracted for at the balance sheet date but not recognised as receivables are analysed as follows:

Group2008 2007$’000 $’000

Not later than one year 134 123 Between two and fi ve years 898 602Later than fi ve years 551 882

1,583 1,607


66

29. CONTINGENT LIABILITIES

A claim was lodged by Segue Electronics, Inc and Shine Capacitors, LLC (collectively the “Plaintiffs”) against the Company and two of its subsidiaries Fujian Juan Kuang Yaming Electric Limited and Anhui Juan Kuang Electric Co., Ltd. (collectively the “Defendants”) in the state of Court of California, USA in year 2005.

The Plaintiffs have claimed monetary damages for loss of profi ts, loss of sales and consequential damages for breach of contracts. The Defendants have fi led cross-complaint and responses to dismiss the claims and are defending their actions.

On 13 September 2007, the court entered judgement in favour of the Company during a special hearing on summary judgement fi led by the Company. This resulted in the Company being dismissed from the case. The Plaintiffs have appealed the aforesaid judgement before the Court of Appeals which was scheduled on 12 March 2009. Legal advice obtained from the Company’s legal counsel indicates that they are reasonably confi dent that the Court of Appeals will affi rm the judgement of the trial court. At the date of authorisation for issue of the accompanying fi nancial statements, the Company has yet to hear the decision from the Court of Appeal.

During the jury trial in September to October 2008 held in Carlifornia Superior Court, the jury awarded the Plaintiff, Segue Electronics, Inc approximately S$5,800,000 (equivalent to US$3,900,000) in damages against the Defendant, Anhui Juan Kuang Electric Co Ltd and no damages against Fujian Juan Kuang Yaming Electric Ltd. The jury awarded no damages to the Plaintiff, Shine Capacitors from the Defendants. Judgement has not been entered on this verdict.

Legal advice obtained from the Company’s legal counsel indicates the intention to bring post-trial motions to overturn the aforesaid jury’s verdict and for a new trial when judgement is entered. The legal counsel expressed that they are reasonably confi dent that the court could grant at least this motion and it is possible that the judge will reduce the amount of damages and/or order a new trial on damages.

30. FINANCIAL RISK MANAGEMENT

Financial risk factors The Group’s activities expose it to a variety of market risks, including the effects of changes in foreign currency exchange

rates and interest rates. The Group’s overall risk management programme focuses on the unpredictability of fi nancial markets and seeks to minimise potential adverse effects on the fi nancial performance of the Group.

(a) Currency risk

The Group operates primarily in the PRC and is exposed to foreign exchange risk arising from various currency exposures primarily with respect to Japanese yen as sales and purchases to a major customer are in Japanese yen.

The Group does not have a formal policy with respect to the abovementioned foreign exchange transactions and

have not undertaken any hedging activities as the Group believes that the practice of using the same currencies for sales and purchases as far as possible provides a natural hedge and reduces the exposure to foreign exchange fl uctuations. If the Group’s business volumes grow in the future, the directors may consider hedging the foreign exchange currency risks.


67

30. FINANCIAL RISK MANAGEMENT (CONT’D)

(a) Currency risk (cont’d)

The fi nancial statements of Chinese subsidiaries were translated from RMB to Singapore Dollar to be included in the Group’s consolidated fi nancial statements.

The Group’s and the Company’s currency exposure based on the information provided to key management is as follows:

RMB JPY USD Others Total$’000 $’000 $’000 $’000 $’000

GroupAt 31 December 2008AssetsBank and cash balances 8,210 2,461 977 5 11,653Trade and other receivables 15,454 5,073 8,323 460 29,310

23,664 7,534 9,300 465 40,963

LiabilitiesBorrowings 17,401 2,393 3,023 2,584 25,401Trade and other payables 20,006 7,168 1,224 589 28,987

37,407 9,561 4,247 3,173 54,388

Net fi nancial assets/ (liabilities) (13,743) (2,027) 5,053 (2,708) (13,425)


GroupAt 31 December 2007AssetsBank and cash balances 3,820 5,386 242 4 9,452Trade and other receivables 20,345 11,419 5,744 151 37,659

24,165 16,805 5,986 155 47,111

LiabilitiesBorrowings 16,809 3,810 3,096 3,372 27,087Trade and other payables 31,709 10,648 - 820 43,177

48,518 14,458 3,096 4,192 70,264

Net fi nancial assets/ (liabilities) (24,353) 2,347 2,890 (4,037) (23,153)


68




CompanyAt 31 December 2008AssetsBank and cash balances - - - - -Trade and other receivables 515 - - - 515

515 - - - 515

LiabilitiesBorrowings - - 2,886 2,584 5,470Trade and other payables - - - 581 581

- - 2,886 3,165 6,051

Net fi nancial assets/ (liabilities) 515 - (2,886) (3,165) (5,536)


CompanyAt 31 December 2007AssetsBank and cash balances - - - - -Trade and other receivables 343 - 734 18 1,095

343 - 734 18 1,095

LiabilitiesBorrowings - - 2,896 3,372 6,268Trade and other payables - - - 820 820

- - 2,896 4,192 7,088

Net fi nancial assets/ (liabilities) 343 - (2,162) (4,174) (5,993)


69



If the USD, RMB and JPY change against the SGD by 2% (2007: 2%) ,3% (2007: 3%) and 4% (2007: 4%) respectively with all other variables including tax rate being held constant, the effects arising from the net fi nancial assets/liabilities position will be as follows:

2008 2007Increase/(Decrease) Increase/(Decrease)

Net Profi t Equity Net Profi t Equity$’000 $’000 $’000 $’000

GroupUSD against SGD- strengthened 101 101 58 58- weaken (101) (101) (58) (58)RMB against SGD- strengthened (412) (412) (731) (731)- weaken 412 412 731 731JPY against SGD- strengthened (81) (81) 94 94- weaken 81 81 (94) (94)

2008 2007Increase/(Decrease) Increase/(Decrease)

Net Profi t Equity Net Profi t Equity$’000 $’000 $’000 $’000

CompanyUSD against SGD- strengthened (58) (58) (43) (43)- weaken 58 58 43 43RMB against SGD- strengthened 15 15 10 10- weaken (15) (15) (10) (10)

(b) Interest rate risks

As the Group has no signifi cant interest-bearing assets, the Group’s income and operating cash fl ows are substantially unaffected by changes in market interest rates, except for the interest rate risks arising from the Group’s borrowings.

The Group’s interest risk mainly arises from borrowings, details of which are set out in Note 21(d). Borrowings expose the Group and the Company to cash fl ow interest rate risk. Borrowings obtained at fi xed rates expose the Group to fair value interest rate risk. The Group’s policy is to obtain the most favourable interest rates available without increasing its foreign currency exposure. Surplus funds are placed with reputable banks.

The Company’s borrowings at variable rates on which effective hedges have not been entered into, are denominated mainly in USD. If the USD interest rates increase/decrease by 0.5% (2007:0.5%) with all other variables including tax rate being held constant, the net profi t will be lower/higher by $25,000 (2007: $14,000).


70


(c) Credit risk

The Group’s companies, except for Fujian J.K. Wiring Systems Co., Ltd, do not have a signifi cant exposure to any individual customer or counterpart. Fujian J.K. Wiring Systems Co., Ltd is a contract manufacturer of Sumitomo Wiring Systems Ltd, a company established in Japan, being the only customer of Fujian J.K. Wiring Systems Co., Ltd.

The Group has policies in place to ensure that sales of products and services are made to customers with a good credit history.

The credit risk for trade receivables based on the information provided to key management is as follows:

Group2008 2007$’000 $’000

By geographical areasSingapore - 4People’s Republic of China 28,525 28,850

28,525 28,854

Most of the Group’s cash and cash equivalents are deposited with banks in PRC. The carrying amounts of trade receivables represent the Group’s maximum exposure to credit risk in relation to its fi nancial assets. The Group’s credit terms range from 90 days to 180 days.

No other fi nancial assets carry a signifi cant exposure to credit risk.

The age analysis of trade receivables past due and not impaired is as follows:

Group2008 2007$’000 $’000

Past due 0 to 6 months 7,690 5,964Past due over 6 months 4,362 7,137

12,052 13,101


71


(d) Liquidity risk

The Group adopts prudent liquidity risk management by maintaining suffi cient cash and having adequate committed credit facilities. Due to the dynamic nature of the underlying businesses, the Group aims at maintaining fl exibility in funding by keeping committed credit lines available.

The maturity for the Group’s fi nancial liabilities based on the information provided to key management is as follows:

Current Non-current1 to 12 2 to 5 AfterMonths years 5 yearsS$’000 S$’000 S$’000

GroupAs at 31 December 2008Trade payables 22,962 - -Other payables 3,529 - -Bank overdrafts 398 - -Bank loans 23,504 797 636Obligation under fi nance lease 42 24 -

As at 31 December 2007Trade payables 35,306 - -Other payables 5,345 - -Bank overdrafts 438Bank loans 24,402 1,465 673Obligation under fi nance lease 42 67 -

(e) Capital management The Group’s objectives when managing capital are:

• to safeguard the Group’s ability to continue as a going concern, so that it can continue to provide returns for shareholders and benefi ts for other stakeholders, and

• to provide an adequate return to shareholders by pricing products and services commensurately with the level of risk.

The Group sets the amount of capital in proportion to risk. The Group manages the capital structure and makes adjustments to it in the light of changes in economic conditions and the risk characteristics of the underlying assets. In order to maintain or adjust the capital structure, the Group may adjust the amount of dividends paid to shareholders, return capital to shareholders, issue new shares, or sell assets to reduce debt.

The Group monitors capital based on a gearing ratio.

The Group maintained 0.18 gearing ratio at 31 December 2008 and 0.26 gearing ratio at 31 December 2007.


72



(e) Capital management (cont’d)

The gearing ratio is calculated as net debt divided by total capital. Net debt is calculated as total debt (as shown in the balance sheet) less cash and cash equivalents. Total capital comprises all components of equity (i.e. share capital, minority interest, retained earnings, and revaluation reserve. The gearing ratios at 31 December 2008 and 2007 were as follows:

Group2008 2007$’000 $’000

Total debt 54,388 70,264Less: cash and cash equivalents (11,653) (9,452)Net debt 42,735 60,812

Total equity 74,683 67,875

Debt-to-adjusted equity ratio 0.57 0.90

31. SIGNIFICANT RELATED PARTY TRANSACTIONS

In addition to the related party information shown elsewhere in the consolidated fi nancial statements of the Group, the following transactions took place between the Group and related parties during the fi nancial year ended 31 December 2008 on terms agreed by the parties concerned:

(a) Sales and purchases of goods and services and bank guarantee

Sumitomo Wiring Systems Ltd (1)

Juan Kuang (Pte) Ltd (2)

Juan Kuang Holdings

Sdn Bhd (2)

Nanping City Electric Equipment

Factory (2)

2008 2007 2008 2007 2008 2007 2008 2007$’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000

Sales of goods 100,990 94,022 319 173 452 398 - -Purchase of raw Materials from 43,336 45,642 - - - - - -Financial guarantee provided by - - - - - - - 5,600

(1) Sumitomo Wiring Systems Ltd is a minority shareholder of one of the Company’s subsidiaries, Fujian J.K Wiring Systems Co., Ltd (“JKW”).

(2) Juan Kuang (Pte) Ltd, Juan Kuang Holdings Sdn Bhd and Nanping City Electric Equipment Factory are related to the Company and the Group through common directors.

73

31. SIGNIFICANT RELATED PARTY TRANSACTIONS (CONT’D)

(b) Key management’s remuneration

The key management’s remuneration included fees, salary, bonus, commission and other emoluments (including benefi ts-in-kind) computed based on the cost incurred by the Group and the Company, and where the Group or Company did not incur any costs, the value of the benefi t. The key management’s remuneration is as follows:

Group2008$’000

2007$’000

Directors’ fees 168 168Salaries and other short term employee benefi ts 1,087 692Contribution to defi ned contribution plans 23 146

1,278 1,006

Included in the above is total compensation to directors of the Company amounting to $688,000 (2007: $642,000).

32. SEGMENT INFORMATION

Primary reporting format – business segment

At 31 December 2008, the Group is organised into four main business segments:

- Electric lighting products – manufacture and sale of electrical lighting products, fi xtures and accessories- Wire Harness – manufacture and sale of wire harness products- Semiconductor – manufacture, assembly and sale of semiconductor and multi-layer packages- Others – manufacture of safe deposit box and rental of investment properties.

Segment assets consist primarily of property, plant and equipment, inventories, trade and other receivables, cash and cash equivalents, and mainly exclude investment properties and inter-segment balances. Segment liabilities comprise operating liabilities and exclude inter-segment balances. Capital expenditures comprise additions to property, plant and equipment (Note 17) and acquisition of intangible assets (Note 19).


74

32.

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75

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76

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77

33. SUBSEQUENT EVENT

Subsequent to the fi nancial year end, an appeal by the Plaintiffs against the Company on the judgment entered on13 September 2007 dismissing the Company from the legal case was brought before the Court of Appeal on12 March 2009. At the date of authorisation for issue of the accompanying fi nancial statements, the Company has yet to hear the decision from the Court of Appeal.

34. NEW ACCOUNTING STANDARDS AND FRS INTERPRETATION

Certain new standards, amendments and interpretations to existing standards have been published and are mandatory for the Group’s accounting periods beginning on or after 1 January 2009 or later periods and which the Group has not early adopted.

• FRS 1 (revised 2008) Presentation of Financial Statements

• FRS 108 Operating Segments

General amendments

Improvement to FRSs

• FRS 1 Presentation of Financial Statements

• FRS 8 Accounting Policies, Change in Accounting Estimates and Errors

• FRS 10 Events after the Reporting Period

• FRS 16 Property, Plant and Equipment

• FRS 18 Revenue

• FRS 19 Employee Benefi ts

• FRS 20 Accounting for Government Grants and Disclosure of Government Assistance

• FRS 23 Borrowing Costs

• FRS 27 Consolidated and Separate Financial Statements

• FRS 28 Investments in Associate and FRS31 interests in Joint Ventures

• FRS 29 Financial Reporting in Hyperinfl ationary Economies

• FRS 31 Interests in Joint Ventures

• FRS 34 Interim Financial Reporting

• FRS 36 Impairment of Assets

• FRS 38 Intangible Assets

• FRS 39 Financial Instruments: Recognition and Measurement

• FRS 40 Investment Property

• FRS 41 Agriculture

• FRS 105 Non-current Assets Held for Sale and Discontinued Operations

• FRS 107 Financial Instruments: Disclosures


78

34. NEW ACCOUNTING STANDARDS AND FRS INTERPRETATION (CONT’D)

The Group’s assessment of the impact of adopting those standards, amendments and interpretations that are relevant to the Group is set out below:

(a) FRS 1(R) Presentation of Financial Statements (effective for annual periods beginning on or after 1 January 2009) The revised standard requires:

• All changes in equity arising from transactions with owners in their capacity as owners to be presented separately from components of comprehensive income;

• Components of comprehensive income not to be included in statement of changes in equity;

• Items of income and expenses and components of other comprehensive income to be presented either in a single statement of comprehensive income with subtotals, or in two separate statements (a separate statement of profi t and loss followed by a statement of comprehensive income);

• Presentation of restated balance sheet as at the beginning of the comparative period when entities make restatements or reclassifi cations of comparative information.

The revisions also include changes in the titles of some of the fi nancial statements primary statements.

The Group will apply the revised standard from 1 January 2009 and provide comparative information that conforms to the requirements of the revised standard. The key impact of the application of the revised standard is the presentation of an additional primary statement, that is, the statement of comprehensive income.

(b) FRS 108 Operating Segments (effective for annual periods beginning on or after 1 January 2009)

FRS 108 supersedes FRS 14 Segment Reporting and requires the Group to report the fi nancial performance of its operating segments based on the information used internally by management for evaluating segment performance and deciding on allocation of resources. Such information may be different from the information included in the fi nancial statements, and the basis of its preparation and reconciliation to the amounts recognised in the fi nancial statements shall be disclosed.

The Group will apply FRS 108 from 1 January 2009 and provide comparative information that conforms to the requirements of FRS 108. The Group expects the new operating segments to be signifi cantly different from business segments currently disclosed and expects more information to be disclosed under FRS 108.

35. AUTHORISATION OF FINANCIAL STATEMENTS

These fi nancial statements were authorised for issue in accordance with a resolution of the Board of Directors of JK Yaming International Holdings Ltd on 31 March 2009.


79

STATISTICS OF SHAREHOLDINGSAS AT 13 MARCH 2009

Issued and Paid-up Capital : S$40,862,336 Class of Shares : Ordinary Shares Voting Rights : One Vote per Ordinary ShareNo. of Holders : Ordinary Share : 348 holders

DISTRIBUTION OF SHAREHOLDINGS AS AT 13 MARCH 2009

No. of Size of Shareholdings Shareholders % No. of Shares % 1 - 999 2 0.58 10 0.001,000 - 10,000 188 54.02 1,120,040 0.5510,001 - 1,000,000 137 39.37 13,408,000 6.611,000,001 AND ABOVE 21 6.03 188,420,130 92.84 TOTAL 348 100.00 202,948,180 100.00

TWENTY LARGEST SHAREHOLDERS AS AT 13 MARCH 2009

No. Shareholders’ Name No. of Shares % 1. Merrill Lynch (Singapore) Pte Ltd 38,511,000 18.982. Juan Kuang Holdings Sdn Bhd 31,322,225 15.433. Amko Industrial Co., Ltd 21,913,155 10.804. SBS Nominees Pte Ltd 17,226,000 8.495. Nanping Holdings Ltd 17,024,750 8.396. United Overseas Bank Nominees Pte Ltd 15,645,000 7.717. Mayban Nominees (S) Pte Ltd 13,640,000 6.728. Hong Leong Finance Nominees Pte Ltd 5,398,000 2.669. RHB Bank Nominees Pte Ltd 3,550,000 1.7510. Chua Cheok Yong 3,245,000 1.6011. Michael Ng 3,112,000 1.5312. Chua Boon Pin (Cai Wenbin) 2,513,000 1.2413. HSBC (Singapore) Nominees Pte Ltd 2,222,000 1.0914. Kim Eng Securities Pte. Ltd. 2,100,000 1.0315. Citibank Nominees Singapore Pte Ltd 2,074,000 1.0216. Hew Kim Loh 2,000,000 0.9917. HL Bank Nominees (S) Pte Ltd 1,900,000 0.9418. Heng Jee Pang 1,400,000 0.6919. Quek Soo Song 1,298,000 0.6420. UOB Kay Hian Pte Ltd 1,198,000 0.59 TOTAL 187,292,130 92.29

Based on Shareholders’ Information as at 13 March 2009, approximately 19.31% of the issued ordinary shares of the Company are held by the public and therefore, Rule 723 of the Listing Manual of the Singapore Exchange Securities Trading Limited, is complied with.

80

STATISTICS OF SHAREHOLDINGSAS AT 13 MARCH 2009

DIRECT AND INDIRECT INTEREST OF SUBSTANTIAL SHAREHOLDERS AS AT 13 MARCH 2009

Direct Interest Indirect InterestName Of Substantial Shareholders No. of Shares % No. of Shares % Ang Chiong Chai 36,136,040 17.80 49,222,2251 24.25Juan Kuang Holdings Sdn Bhd 48,822,225 24.06 - -Phihong International Corp 38,511,000 18.98 - -Amko Industrial Co., Ltd 21,913,155 10.80 - -Nanping Holdings Ltd 17,024,750 8.39 - -Juan Kuang (Pte) Ltd 400,000 0.20 48,822,2252 24.06Dato’ Ng Kim Poh 827,000 0.41 21,913,1553 10.80Zheng Qingfa - - 17,024,7504 8.39Chen Min - - 17,024,7504 8.39

Note :-

1. Deemed interest by virtue of his interests (direct of 5.5% and indirect through Juan Kuang (Pte) Ltd of 40.6%) in Juan Kuang Holdings Sdn Bhd, and direct interest of 56.62% in Juan Kuang (Pte) Ltd.

2. Deemed interest by virtue of its direct interest of 40.6% in Juan Kuang Holdings Sdn Bhd3. Deemed interest by virtue of his direct interest of 96% in Amko Industrial Co., Ltd4. Deemed interest by virtue of their direct interest of 50% each, in Nanping Holdings Ltd

81

NOTICE IS HEREBY GIVEN that the Annual General Meeting of the Company will be held at The Gallery, Level 4 Paramount Hotel, 25 Marine Parade, Singapore 449536 on 24 April 2009 at 10.00 a.m. to transact the following businesses:-

AS ORDINARY BUSINESSES :

1. To receive and adopt the Directors’ Report and Audited Financial Statements of the Company for the fi nancial year ended 31 December 2008 together with the Independent Auditor’s Report thereon.

Resolution 1

2. To approve the payment of Directors’ fees of S$168,000 for the fi nancial year ended 31 December 2008. Resolution 2

3. To re-elect the following Directors of the Company, retiring by rotation pursuant to Article 91 of the Company’s Articles of Association :-

(a) Mr. Lee Poo Sik

Mr. Lee Poo Sik will, upon re-election as a Director of the Company, remain as the member of the Audit Committee, of the Company.

Resolution 3

(b) Mr. Yu Swee Sing

Mr. Yu Swee Sing will, upon re-election as a Director of the Company, remain as Chairman of the Audit Committee and member of the Nominating Committee, of the Company. He will be considered to be independent for the purpose of Rule 704(8) of the Listing Manual of the Singapore Exchange Securities Trading Limited (“SGX-ST”).

Resolution 4

4. To re-appoint the following Directors of the Company, pursuant to the Section 153(6) of the Companies Act, Chapter 50 (“the Act”) of Singapore to hold such offi ce from the date of this Annual General Meeting until the next Annual General Meeting of the Company:-

(a) Mr. Ang Chiong Chai

Mr. Ang Chiong Chai will, upon re-appointed as a Director of the Company, remain as the Chairman of the Company and member of the Nominating Committee.

Resolution 5

(b) Mr. Tan Boon Kiat @ Tan Ka Seng Resolution 6

5. To re-appoint Messrs. LTC LLP as the Auditors of the Company and to authorise the Directors to fi xtheir remuneration.

Resolution 7

AS SPECIAL BUSINESSES :

To consider and, if thought fi t, to pass the following ordinary resolutions with or without modifi cations:-

6. Authority to issue shares Resolution 8

“(a) That pursuant to Section 161 of the Act and the provisions of Rule 806 of the Listing Manual of the SGX-ST, the Directors be empowered to allot and issue shares and convertible securities in the capital of the Company at any time and upon such terms and conditions and for such purposes as the Directors may, in their absolute discretion, deem fi t provided that:-

NOTICE OF ANNUAL GENERAL MEETING

82

(i) the aggregate number of shares (including shares to be issued in accordance with the terms of convertible securities issued, made or granted pursuant to this Resolution) to be allotted and issued pursuant to this Resolution shall not exceed fi fty per centum (50%) of the total number issued shares excluding treasury shares, of the Company at the time of the passing of this Resolution; and

(ii) the aggregate number of shares and convertible securities to be issued other than on a pro-rata basis to existing shareholders of the Company shall not exceed twenty per centum (20%) of the total number of issued shares excluding treasury shares, of the Company at the time of the passing of this Resolution.

(b) For the purpose of determining the aggregate number of shares that may be issued under (a) above, the percentage of issued share capital is based on the issued share capital of the Company at the time of the passing of this resolution, after adjusting for:-

(i) new shares arising from the conversion or exercise of convertible securities;

(ii) new shares arising from exercising share options or vesting of share awards outstanding or subsisting at the time of the passing of the resolution approving the mandate, provided the options or awards were granted in compliance with Part VIII of Chapter 8 of the SGX-ST Listing Manual; and

(iii) any subsequent bonus issue, consolidation or subdivision of shares.

(c) The 50% limit in (a) above may be increased to 100% for the Company to undertake pro-rata renounceable rights issues.

and unless revoked or varied by the Company in General Meeting, such authority shall continue in force until the conclusion of the next Annual General Meeting of the Company or the date by which the next Annual General Meeting is required to by law to be held, whichever is the earlier.”

(See Explanatory Note 1)

7. Authority to issue shares (other than on a pro-rata basis) with a maximum discount of 20% Resolution 9

“That subject to and pursuant to the share issue mandate in the Resolution No. 8 above being obtained, authority be and is hereby given to the Directors to issue new shares other than on a pro-rata basis to shareholders of the Company at an issue price per new share which shall be determined by the Directors in their absolute discretion provided that such price shall not represent more than a 20% discount for new shares to the weighted average price per share determined in accordance with the requirements of the SGX-ST.”


8. Proposed Renewal of the Shareholders’ Mandate for Interested Person Transactions Resolution 10

“That for the purposes of Chapter 9 of the Listing Manual of the SGX-ST :-

(a) approval be given for the renewal of the mandate for the Company, its subsidiaries and target associated companies or any of them to enter into any of the transactions falling within the types of Interested Person Transactions as set out in paragraph 3 the Company’s Circular to Shareholders dated 8 April 2009 (“Circular”) with any party who is of the class of Interested Persons described in the Circular, provided that such transactions are carried out in the normal course of business, at arm’s length and on commercial terms and in accordance with the guidelines of the Company for Interested Person Transactions as set out in the Circular (the “Shareholders’ Mandate”);


83


(b) the Shareholders’ Mandate shall, unless revoked or varied by the Company in a general meeting, continue in force until the date on which the next Annual General Meeting of the Company is or is required by law to be held, whichever is the earlier; and

(c) authority be given to the Directors of the Company to complete and do all such acts and things (including executing all such documents as may be required) as they may consider necessary, desirable or expedient to give effect to the Shareholders’ Mandate as they may think fi t.”


9. To transact any other business which may be properly transacted at an Annual General Meeting.

ON BEHALF OF THE BOARD


8 April 2009

Explanatory Notes:-

1. Special Business – Item 6 of the Agenda

Ordinary Resolution 8 proposed in item no. 6 above, if passed, will empower the Directors, from the date of the passing of Ordinary Resolution 8 to the date of the next Annual General Meeting, to issue Shares in the capital of the Company and to make or grant instruments (such as warrants or debentures) convertible into Shares, and to issue Shares in pursuance of such instruments, up to an amount not exceeding in total 50% of the issued Shares (excluding treasury shares) in the capital of the Company, with a sub-limit of 20% of the issued Shares (excluding treasury shares) for issues other than on a pro rata basis to shareholders. The foregoing is subject to the exception that where the Company undertakes a renounceable pro rata issue of Shares (including Shares to be issued pursuant to such instruments), the maximum number of such Shares that can be issued is 100% of the issued Shares (excluding treasury shares) in the capital of the Company.

In exercising the authority conferred by Ordinary Resolution 8, the Company shall comply with the requirements of the SGX-ST (unless waived by the SGX-ST), all applicable legal requirements and the Company’s Articles of Association. [Rule 806 of the SGX-ST Listing Manual presently allows a listed issuer to seek a general mandate from shareholders for inter alia issuance of new shares and convertible securities on a pro-rata basis amounting to not more than 50% of its issued share capital (excluding treasury shares).]

On 19 February 2009, the SGX-ST released a press release of new measures effective on 20 February 2009 (the “Press Release”); the new measures include allowing issuers to issue up to 100% of its issued share capital via a pro rata renounceable rights issue, subject to the condition that the issuer makes periodic announcements on the use of the proceeds as and when the funds are materially disbursed and provides a status report on the use of proceeds in its annual report. The Press Release states that this new measure will be in effect until 31 December 2010 when it will be reviewed by the SGX-ST.

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The Ordinary Resolution 9 proposed in item 7 above, if passed, will empower the Directors, pursuant to the general mandate to issue Shares set out in Ordinary Resolution 8, to issue Shares other than on a pro rata basis to shareholders of the Company, at a discount to the weighted average price of the Shares on the SGX-ST for the full market day on which the placement or subscription agreement is signed (or if not available, the weighted average price based on the trades done on the preceding market day), exceeding 10% but not more than 20%.

In exercising the authority conferred by Ordinary Resolution 9, the Company shall comply with the requirements of the SGX-ST (unless waived by the SGX-ST), all applicable legal requirements and the Company’s Articles of Association. Rule 811(1) of the SGX-ST Listing Manual presently provides that an issue of shares must not be priced at more than 10% discount to the weighted average price for trades done on the SGX-ST for the full market day on which the placement or subscription agreement is signed (or if not available, the weighted average price based on the trades done on the preceding market day).

The Press Release also included a new measure allowing issuers to undertake placements of new shares using the general mandate to issue shares, priced at discounts of up to 20%, subject to the conditions that the issuer seeks shareholders’ approval in a separate resolution at a general meeting to issue new shares on a non pro-rata basis at a discount exceeding 10% but not more than 20%, and the general share issue mandate resolution is not conditional on this resolution. Ordinary Resolution 9 has been included following this new measure. The Press Release states that this new measure will also be in effect until 31 December 2010 when it will be reviewed by the SGX-ST.


The Ordinary Resolution 10 proposed in item no. 8 above, if passed, will authorise the Interested Person Transactions as described in the Circular and recurring in the year and will empower the Directors to do all acts necessary to give effect to the Shareholders’ Mandate. This authority shall, unless revoked or varied by the Company in general meeting, continue in force until the date on which the next Annual General Meeting of the Company is or is required by law to be held, whichever is the earlier.

4. Appointment of Proxy

a) A Member entitled to attend and vote at a meeting of the Company shall be entitled to appoint not more than two proxies to attend and vote instead of him.

b) In any case where the Proxy Form appoints more than one proxy, the proportion of the shareholding concerned to be represented by each proxy shall be specifi ed in the Proxy Form.

c) A proxy need not be a Member.

d) The Proxy Form shall be in writing under the hand of the appointor or of his attorney duly authorised in writing, or if the appointor is a corporation, either under its seal or under the hand of an offi cer or attorney duly authorised.

e) The Proxy Form and the power of attorney or other authority (if any) under which it is signed or a duly certifi ed copy of that power or attorney, shall be delivered to the Company’s registered offi ce at 160 Paya Lebar Road, #08-03 Orion Industrial Building, Singapore 409022, not less than forty-eight (48) hours before the time appointed for holding the Meeting.

f) The Proxy Form shall be deemed to confer authority upon the proxy to demand or join in demanding a poll and to vote on any resolution put to the meeting as the proxy thinks fi t and shall be valid as well for any adjournment of the meeting.


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JK YAMING INTERNATIONAL HOLDINGS LTD(Company No. : 199906353N) (Incorporated in the Republic of Singapore)

ANNUAL GENERAL MEETING PROXY FORM

IMPORTANT1. For investors who have used their CPF monies to

buy JK Yaming International Holdings Ltd shares, the Annual Report is forwarded to them at the request of their CPF Approved Nominees and is sent FOR INFORMATION ONLY.

2. This Proxy Form is not valid for use by CPF investors and shall be ineffective for all intents and purposes if used or purported to be used by them.

*I/We

of

being *a member/members of JK Yaming International Holdings Ltd (the “Company”), hereby appoint

Name Address Nric/Passport No. Proportion of Shareholdings to be

Represented by Proxy (%)

*and/or

as *my/our *proxy/proxies to vote for *me/us on *my/our behalf and, if necessary, to demand a poll, at the Annual General Meeting of the Company to be held at The Gallery, Level 4 Paramount Hotel, 25 Marine Parade, Singapore 449536 on 24 April 2009 at 10.00 a.m., and at any adjournment thereof.

*I/we direct *my/our *proxy/proxies to vote for or against the Ordinary Resolutions to be proposed at the Annual General Meeting as indicated with an “X” in the spaces provided hereunder. If no specified directions as to voting are given, the *proxy/proxies will vote or abstain from voting at *his/their discretion.

No. Ordinary Resolutions For Against

1. To receive and adopt the Directors’ Report and Audited Financial Statements of the Company for the financial year ended 31 December 2008, together with the Independent Auditor’s Report thereon.

2. To approve the payment of Directors’ fees of S$168,000 for the financial year ended 31 December 2008.

3. To re-elect Mr. Lee Poo Sik, the Director of the Company retiring by rotation pursuant to Article 91 of the Company’s Articles of Association.

4. To re-elect Mr. Yu Swee Sing, the Director of the Company retiring by rotation pursuant to Article 91 of the Company’s Articles of Association.

5. To re-appoint Mr. Ang Chiong Chai, the Director of the Company pursuant to the Section 153(6) of the Companies Act (Chap 50).

6. To re-appoint Mr. Tan Boon Kiat @ Tan Ka Seng, the Director of the Company pursuant to the Section 153(6) of the Companies Act (Chap 50).

7. To re-appoint Messrs. LTC LLP as the Auditors of the Company and to authorise the Directors to fix their remuneration.

8. Authority to allot shares

9. Authority to issue shares (other than on a pro-rata basis) with a maximum discount of 20%

10. Proposed Renewal of the Shareholders’ Mandate for Interested Person Transactions.

Dated this day of 2009 Total Number of Shares Held

Signature(s) of Member(s)/Common Seal* Delete accordingly IMPORTANT. Please read notes overleaf

Notes:-

a) A Member entitled to attend and vote at a meeting of the Company shall be entitled to appoint not more than two proxies to attend and vote instead of him.

b) In any case where the Proxy Form appoints more than one proxy, the proportion of the shareholding concerned to be represented by each proxy shall be specified in the Proxy Form.

c) A proxy need not be a Member.

d) The Proxy Form shall be in writing under the hand of the appointor or of his attorney duly authorised in writing, or if the appointor is a corporation, either under its seal or under the hand of an officer or attorney duly authorised.

e) The Proxy Form and the power of attorney or other authority (if any) under which it is signed or a duly certified copy of that power or attorney, shall be delivered to the Company’s registered office at 160 Paya Lebar Road, #08-03 Orion Industrial Building, Singapore 409022, not less than forty-eight (48) hours before the time appointed for holding the Meeting.

f) The Proxy Form shall be deemed to confer authority upon the proxy to demand or join in demanding a poll and to vote on any resolution put to the meeting as the proxy thinks fit and shall be valid as well for any adjournment of the meeting.

g) A member should insert the total number of shares held. If the member has shares entered against his name in the Depository Register (as defined in Section 130A of the Companies Act, Chapter 50 of Singapore), he should insert that number of shares. If the member has shares registered in his name in the Register of Members of the Company, he should insert the number of shares. If the member has shares entered against his name in the Depository Register and shares registered in his name in the Register of Members of the Company, he should insert the aggregate number of shares. If no number is inserted, this form of proxy will be deemed to relate to all the shares held by the member of the Company.

h) The Company shall be entitled to reject the instrument appointing a proxy or proxies if it is incomplete, improperly completed or illegible or where the true intentions of the appointor are not ascertainable from the instructions of the appointor specified in the instrument appointing a proxy or proxies. In addition, in the case of members of the Company whose shares are entered against their names in the Depository Register, the Company may reject any instrument appointing a proxy or proxies lodged if such members are not shown to have shares entered against their names in the Depository Register 48 hours before the time appointed for holding the Annual General Meeting as certified by The Central Depository (Pte) Limited to the Company.

i) A Depositor shall not be regarded as a member of the Company entitled to attend the Annual General Meeting and to speak and vote thereat unless his name appears on the Depository Register 48 hours before the time set for the Annual General Meeting.

AFFIXSTAMP

The Company Secretary JK YAMING INTERNATIONAL HOLDINGS LTD 160 Paya Lebar Road #08-03 Orion Industrial Building Singapore 409022

Mission

Emerging from a general manufacturer to an highly engineering value added producer of lighting products with world class research and development capacity in the design and manufacturing of environmental friendly ,energy saving electrical lighting products—Induction lamps.

Our research institute located at Fuzhou is equipped with the most advanced equipments and we work together with high caliber post doctorates from top universities.

We will continue to share these engineering values created by us with our customers, business associates, our shareholders and to contribute in meaningful ways towards the highly demanded, imminent global needs for energy saving and greener living environment.

Contents

Corporate Profi le 01Chairman’s Statement 02Board of Directors 04Corporate Structure 06Corporate Information 07Business Review 085-Year Financial Review 10Financial Contents 12

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