jubile: annual report 2012

Board of Director

Executive Management Team

Message from the Board of Directors

General Information

Financial Highlight

Nature of Business Operation

Risk Factors

Shareholding Structure

Mangement Structure

Corporate Governance

Internal Audit

Related Transaction

Conclusion of Financial Status and Results of Performance

The Board of Director’s Responsibilities in Respect of

The Financial Statement to Shareholders

Report of the Audit Committee

Financial Statement

12

13

14

15

17

18

24

35

36

48

62

63

75

98

99

101

12

Board of Director

Manu Leaopairoj

Chairman

Amnuay

Nakruchata-amorn

Chairman of

the Audit Commitee

Pirote Maleehorm

Audit Committee

Suvatana Tulayapisitchai

Director

Zonwa Denmeka

Audit Committee

Unyarat Pornprakit

Director

Sahasroj Rojmetha

Director

Viroj Phonprakit

Vice Chairman

Annual Report 2012 Jubilee Enterprise Public Company Limited

Viroj Phonprakit

Chief Executive Officer

Unyarat Pornprakit

Chief Financial Officer

Yuttana Taepangthong

Director – Finance &

Accounting Department

Warawut Settanarag

Senior Director – Internal

Audit Office

Varit Saimala

Director – Purchasing

Department

Sophon

Aroonsuraphonmaythee

Marketing Director

Suvatana Tulayapisitchai

Deputy Senior Chief Executive

Officer

Executive Management Team

13Annual Report 2012 Jubilee Enterprise Public Company Limited

The year 2012 is deemed as the achievement of the Jubilee Enterprise Public Company Limited.

Although the situation from outside and the competition is very challenging, the company has gained

profit totally THB 1,226.23 million due to the focus of quality and design development and the diamond

selection imported from Belgium where is the best hub of the world in diamond cut including the professional

service to reach the customer’s satisfaction. Such amount of profit is increased from 2011 or equivalent to

38.19% while the profit net is approximately THB 165.87 million or equivalent to 26.43%. Moreover, we also

have focused develop diamond jewelry in Thailand in order to meet the international standards accepted by

Thais and foreigners. This results to the honorable award called SET AWARDS 2012, organized by the Stock

Exchange of Thailand in association with Money & Banking Magazine, in the field of the Best Investor

Relations Award and the Outstanding Company Performance Awards.

With dedication in this industry; therefore, we, the Jubilee Enterprise Public Company Limited,

are now Thailand’s leading retailer of diamond jewelry. We are the pioneer of the retail company

in diamond and jewelry and we are only one company entered into the mai stock market. We, nowadays,

are the first rank company who has branches more than the others which is totally 95 branches all over the

regions of Thailand. We are well-known and credible among the diamond and gem industry. Furthermore,

we are the leader in creating the new innovations to the diamond business such as the distribution channel,

career stability, standardization of the jewelry use and the provision of the international diamond certification

for the customer in Thailand.

The Board of Directors would like to express our gratitude to shareholders, customers, business

partners, colleagues and the relevant stakeholders including the financial institutions assisting us continually.

In this regard, we may ask you to entrust that we would carry on the business with vigilance and due

diligence; adhere to the code of ethics, good governance and sustainable development in order to maximize

the benefit to all relevant parties; and to realize the importance of community, society and environment in

order to go forward together with Thailand eternally.

Manu Leopairote

Chairman of the Board of Directors

Viroj Phonprakit


MESSAGE FROM THE BOARD OF DIRECTORS

Annual Report 2012 Jubilee Enterprise Public Company Limited14

General Information

Annual Report 2012 Jubilee Enterprise Public Company Limited 15

Company Name : Jubilee Enterprise Public Company Limited (JUBILEE)

Registration No. : 0107551000177

Type of Business : Producer and Retailer of diamond jewelry carat diamond and

loose diamond

Headquarter office : 721 Silom Road Bangrak Bangkok 10500

Telephone : 0-2266-5700

Fax : 0-2635-2739

Home Page : www.jubileediamond.co.th

Registered Capital : 175,000,000 Baht

Paid-up Capital : 173,297,625 Baht

Par Value : 1 Baht

Contacted Person : Mr. Yuttana Taepangthong and Mrs. Patcharawalai Atichatipjinda

E-mail : [email protected]

Securities Registrar : Thailand Securities Depository Co., Ltd. (TSD)

62 The Stock Exchange of Thailand Building

4, 7 Floor Rachadapisek Klongtoei Bangkok 10110

Tel. 0-2229-2800 Fax. 0-2235-1259

Auditor : ANS Audit Co., Ltd.

Mr. Prawit Viwanthananut, CPA Licence No 4917;

Mr. Athiphong Athiphongsakun, CPA Licence No 3500;

Mr. Bunjong Pichayaprasat, CPA Licence No 7147; or

Mr. Thoetthong Thepmangkon, CPA Licence No 3787;

Legal Advisor : C AM International Law Co., Ltd.

67/55 Moo 8 Soi Rattanatibet 24 Rattanatibet Road Muang Nonthaburi

Reference

Financial Highlight

Annual Report 2012 Jubilee Enterprise Public Company Limited16

372.89434.03

247.31213.25218.86

647.28

746.57

591.75

499.26

Total Revenue (MB)

Net Profit (MB)

Total Asset

Total LiabilitiesTotal Shareholder’s Equity

103.73

20.0040.00

80.0060.00

100.00

0.00

120.00140.00

2010 2011 2012

160.00180.00

131.19

165.87

689.12

200.00

400.00

600.00

0.00

800.00

1000.00

2010 2011 2012

1200.00

1400.00

887.32

1226.23

Balance Sheet (MB)

0

100

200

300

400

500

600

700

800

2010 2011 2012

17

Financial Highlight

Operating Result (MB)

Total Revenue

Cost of Goods Sold

Gross Profit

Operating Profit

Net Profit

Balance Sheet

Total Asset

Total Liabilities

Shareholder’s Equity

Share Value

Earning per shares (EPS)

Dividend (Satang)

Financial Ratio

Gross Profit Margin

Operating Profit Margin

Net Profit Margin

Current Ratio

Quick Ratio

Debt to Equity Ratio

Return on Assets (ROA)

Return on Equity (ROE)

Average Collection Period (days)

Average Payment Period (days)

1,226.23

716.02

510.21

209.45

165.87

746.57

247.31

499.26

0.96

0.60

41.61%

16.70%

13.47%

2.92

0.86

0.50

23.80%

35.54%

19.40

81.63

887.32

497.67

389.65

166.83

131.19

647.28

213.25

434.03

0.77

0.52

43.91%

18.06%

14.73%

2.89

0.94

0.49

21.18%

32.52%

23.90

116.50

689.12

379.71

309.41

130.65

103.73

591.75

218.86

372.89

0.61

0.35

44.90%

18.32%

14.96%

2.58

1.09

0.59

19.18%

29.55%

33.21

108.43

2012 2011 2010


18

NATURE OF BUSINESS OPERATION

Company History and Milestones

The company has been registered and named “Jubilee Enterprise Company Limited” on 3rd November,

1993. Previously, the registered capital was the sum of THB 10,000,000 but was increased to THB 40,000,000

later in order to support the ongoing business expansion. With capacity, experiences and expertise in this

industry, we have been growing rapidly and resulting to the additional registered and paid-up capital up to

THB 120,000,000 in 2008 eventually.

On 8th July, 2008, the company has transformed from the private company to the public company

and named Jubilee Enterprise Public Company Limited. The company has increased the registered capital

from THB 120,000,000 to THB 175,000,000 by way of issuing the common share at the amount of 55,000,000

shares while the par value is of THB 1 in order to offer to sell the share to the specific investors at the

amount of 15,000,000 shares and another 35,000,000 shaes for the public and to bestow the Employee Stock

Option (ESOP) issued by the company for the directors and employees at the amont of 5,000,000 shares.

During 26-28th October, 2009, the company launched the Initial Public Offering and has entered into

the MAI stock market officially on 9th November, 2009.

During 28-30th October 2010, the company provided the first ESOP to the directors and employees

at the amount of 1,121,500 right : common share.

On 5th November, 2010, the company adjusted to register the first paid up ESOP for the directors

and employees from THB 170,000,000 to THB 171,121,500 at the Department of Business Development, the

Ministry of Commerce.

During 28-30 October, 2011, the company adjusted the number of the second ESOP to the directors

and employees at the amount of 1,166,250 right : common share.

On 9th November, 2011, the company adjusted to register the second paid up ESOP for the directors



On 7th November, 2012, the company adjusted to register the third paid up ESOP for the directors




19

The company has rented the space in shopping mall to expand the branches

nationwide totally 18 branches and 1 was closed down. These beanches are as follows;

The available branch operated in 2012

1. Tesco Lotus - Prachinburi

2. ZEN – Central World

3. Robinson - Suphan Buri

4. Central Plaza – Rama IX

5. Central Plaza – Rama III

6. Robinson – Mega Bangna

7. Central Plaza – Udon Thani

8. Central Plaza – Pattaya Beach

9. Mega Mall - Bangna

10. Robinson – Chiang Mai

11. Secon Square - Bang Khae

12. Central Plaza - Rattanathibet

13. Central Plaza – Surat Thani

14. Robinson – Surat Thani

15. Tesco Lotus - Sadao

16. Robinson – Lampang

17. Central Plaza – Lampang

18. Tesco Lotus - Phisanulok

Branch closed down in 2012

1. Central Plaza – Rama III


20

The company expanded the branch in the form of the shop counter to sell the diamond

firstly at Yaohan Department Store. This deemed as the first phenomenon for diamond sale

at the shop counter in Thailand.

The company has started to carry on its business as franschise in Bangkok and surrounding

provinces and central region. It has expanded to the North and the Northeast region later

on which was the pioneer to sell the diamond with this marketing. Overall the company

had 10 branches.

The company adjusted the marketing strategy and started to expand the shop counters

at the big mall such as Central Plaza, Robinson, The Mall and the local department stores

totally 15 branches.

The company, in partnership with the credit card company, started the marketing plan to

display and sell the products through the newsletter. This deemed as the first time for the

diamond industry using this marketing plan.

In order to expand the market, the company opened the additional shop counter at the

mall and the hypermart such as Tesco Lotus and Bic C at the end of 2003 totally 37

branches.

The company had 45 branches in total nationwide.

The company won the “Super Brand Winner 2005” awarded by the Reader’s Digest in the

catergory of Best Customer’s Satisfaction. The company had 50 branches totally.

On 26th November, 2007 at the Extraordinary General Meeting of Shareholders No. 1/2550,

the Board had resuolution to increase the capital from THB 10,000,000 to THB 40,000,000

while the par value was of 100 baht.

The company standardized the customer on the creditability of the diamond by granting the

certificate from the international institute that is internationally well-known. The certificate

will be granted at least for the one-carat-diamond by the Hoge Raad voor Diamant (HRD)

issued by the Diamond High Council, Belgium in order to enhance confidence of the

customer more than previously.

The company has founded the HRD firstly in Thailand where it is the gem center to sell

diamond certified by HRD only at Pan Pacific Hotel, Bangkok.

The company, in partnership with the Krungthai Leasing Co. Ltd. (the subsidiary of the Krung

Thai Bank Group) started to accept the payment in form of installment for the diamond

purchase through all branches of the Krung Thai Bank.

IncidentYear

Mr. Viroj Phonprakit has founded the company called “Jubilee Enterprise Company Limited”.

The registered capital was the sum of THB 10,000,000 which was equal to 100,000 shares


1993

1994

1995

1997

2001

2003

2005

2006

2007

Timeline and Milestone in brief is as follows;


21

IncidentYear

The company bought the inventory from Jubilee Diamond Partnership where it had commer-

cial relationship with. Mr. Suntorn Pornprakit, the manager of Jubilee Diamond Partnership,

who is the father of Mr. Viroj Phonprakit, the Deputy Chairman of the Board of Directors

and the President of the Company, granted the right to enjoy the building belonged to the

Jubilee Diamond Partnership for the company to open the new branch at Sapan Lek selling

the diamond under the brand called “Diamnond Center” and “Jubilee Diamond”.

The company started to sell the diamond certified by the GIA (Gemelogical Institute of

America) in order to enhance the customer’s options and quality confidence.

On 30th April, 2008 at the Extraordinary General Meeting of Shareholders No. 1/2551, the

Board had resuolution to increase the capital from THB 40,000,000 to THB 120,000,000


On 5th June, 2008 at the Extraordinary General Meeting of Shareholders No. 2/2551, the

Board had resuolution to transform the company from private entity to public entity and

adjusted the par value of the share from 100 baht to 1 baht instead.

On 9th November, 2009, the company has entered into MAI stock market.

On 31st December, 2009, the company had 73 branches in total.

During 28-30th October, 2010, the company firstly issued the ESOP to the directors and

employees (according to the Extraordinary General Meeting of Shareholders No. 4/2551 for

the Jubilee Enterprise Public Company Limited dated on 27th August, 2008). The meeting had

resolution to issue ESOP for the amount of 4,997,5000 shares at the par value of 1 baht.

On 5th November, 2010, the company registered to change the amount of the paid up capital

because of the first ESOP provided for the directors and employees from THB 170,000,000 to

THB 171,121,500 at the Department of Business Development, the Ministry of Commerce.

On 2nd

September, 2008, the K-SME Venture Capital Co. Ltd., under the supervision of the

Khao Kla Venture Capital Management Co., Ltd. bought 15,000,000 shares catergorized as

specific investor resulting to the addition registered capital totally THB 135,000,000.

On 31st December, 2008, the company had 60 branches in total.

On 20th June, 2008 at the Extraordinary General Meeting of Shareholders No. 3/2551, the

Board had resuolution to increase the capital from THB 120,000,000 to THB 175,000,000

by way of issuing the common share at the amount of 55,000,000. To clarify, the company

allotted 15,000,000 shares in order to offer to sell the share to the specific investors,

35,000,000 shaes was for the public and the last 5,000,000 shares was for the ESOP

issued by the company for the directors and employees. The capital was already paid up

at THB 120,000,000.

2008

2009

2010


22

The company expanded the additional braches from 73 to 78 dated on 31st December,

2010.

During 28-30th October, 2011, the company secondly issued the ESOP to the directors and







15th March 2012, the company won “Bai Po Business Awards by Sasin” with 3 categories

: 1 Quality 2. Innovation 3 Branding.

During 28-30th October, 2012, the company secondly issued the ESOP to the directors and







22 November 2012, the company won the SET Awards 2012 in Best Investor Relations and

Outstanding Company Performance. The awards initiated by the Stock Exchange of Thailand

in conjunction with the Money and Banking Magazine

The company expanded the additional braches from 78 to 79 dated on 31st December,

2011.

The company expanded the additional branches from 79 to 95 dated on 31st December,

2012.

2011

2012

IncidentYear


23

Purpose of business

Souce of revenue

(Unit: Million Baht)

The company aims to lead the business on diamond and jewelry retail in Thailand by developing

the diamond purchase with the transparent manner; disclosing the correct information to the customer and

adapting the customer’s attitude to concentrate the work elaboration in order to meet with internation practice.

Moreover, the company tends to emphasize branding called “Jubilee Diamond” with confidence and

strength.

Vision

To create more values with precious diamond jewelry of the company for all people with innovations

on product design, counter brand and display management with efficiency and material selection with

development of manufacturing technologies;

Mission

1. To be Thailand’s leading retailer of diamond jewelry

2. Value added to the organization, shareholders and stakeholders.

3. To continuous develop product quality and professional service

4. To create brand and image to worldwide

5. To develop human resources continually

6. To focus on Good Corporate Governance, Risk Management, Internal Control

2010

Amount Amount AmountRatio Ratio Ratio

Million Million MillionPercentage Percentage Percentage

2011 2012

Source

1. Diamond Jewelry

2. Carat Diamond

3. Service fee

Total

614.03

69.66

5.43

689.12

89.10

10.11

0.79

100.00

793.19

88.36

5.77

887.32

89.39

9.96

0.65

100.00

1,089.34

131.05

5.84

1,226.23

88.84

10.69

0.47

100.00


24

RISK FACTORS

During 2012, Thailand passes the huge inundation and accepted to pay minimal wage at 300 baht

per day. The Jubilee Enterprise Public Company Limited was necessary to be aware of risk management

in order to mitigate the impact that might be arisen regardless from inside or outside firm. Certain risks are

regarded as the priority issue for carrying on the business which can be considered and clarified below:

1 Risk based on the economic situation

Due to the year 2009-2012, many countries faced the economic crisis such as the subprime in the U.S.

which affected extensively and constantly around the world. Thailand still highly depended on exportation as

shown in the ratio of exportation per GDP which was approximately 60%. Especially the ratio of exportation

in the U.S. was approximately 25% based on the gross exportation during the year 2007-2011. The economic

recession in the U.S. affected to the manufacturer and exporter and collapsed their businesses eventually.

This led to the growth of unemployment and a drop of household income which affect to the declination of

the domestic purchasing power consequently. Moreover, Thailand accepted to increase the minimal wage

per day resulting to the collapse of the SME business due to the unacceptable additional cost while people

distrusted the economic stability. Because of these given factors, people saved money rather than spending

while this affected to the domestic demand including the demand of jewelry which is the main products of

the company. Therefore, the growth of company was full of ups and downs in this particular period.

However, the Board of the company had the policies to minimize such impacts. Those policies were

such as inventory management, applying the marketing tool to meet the customer’s demand, conducting

the marketing research to study the customer’s demand and behavior, and having the sale promotion

in order to draw attention of the customer. In terms of cost and relevant expenses, the company

negotiated with the supplier including to manage and control the sale cost as it deemed appropriate.

2 Risk based on business that has high cost and moveable

The products of the company are diamond and jewelry that have high cost and movable; therefore,

it is the risk that the company has to be careful for the espionage from outsider and insider. Moreover, the

company has to bear the risk for its loss because of the diamond transit from one to another place.

For the risk caused by the outsider such as espionage or the risk from the fraud conducted by

the insider of the company, i.e., No record and replacement for the purchase of diamond; or the espionage

conducted by the insider; or sale of the artificial diamond while the authentic one stolen by the insider. The

company has the policies and rules to perform its business focusing the purpose of “strict protection” in

all process and areas. For the example, the company has policy to store the product in the safe after the

work, the inventory will be recorded in the in-and-out item and the computation of the completeness and

correction shall be made at the end of the day always. Moreover, the company stores the material in the

strong room inside the headquarter of the company where the CCTV will be monitored 24 hours together

with the heat detector system.


25

For the internal examination, the company randomly examines the products at certain branches

where the audit and district manager check the stock at least 2 times a month while the products at the

strong room at the headquarter is examined at least once a month. Moreover, the company has the policy to

transfer the products to other branches constantly through the headquarter without notice and information.

Therefore given examples previously are seldom happened.

Moreover, the company seeks the remediation in case of damage existed, such as conflagration and

espionage by way of insurance dated on 31st December, 2012. The ratio between the sum insured per the

net inventory is approximately 80%.

For the risk of transfer, every transfer regardless from one to another place or from the headquarter

to the branches shall be only accepted and allowed by the manager of the Sale Administration Department.

Direct transfer between the branches is not allowed. All the process shall start from the headquarter only

while the Sale Administration Department will manage and control all the transfer from the origin to the

destination. Record of transfer is needed to make including to endorse the authorized signature for the

transfer confirmation at the Warehouse Department. All transfers will be insured at all time while the value

of each transfer shall not be exceeding THB 150,000 per time. Such value of the insurance is subject to the

100% claim. Therefore, if the loss during the transfer is existed, the company’s income shall not be affected

substantively.

The company has policies and rules to control entry and exit of the strong room substantively as

follows;

• To enter the warehouse, it needs key and magnet card possessed by the manager of the

Warehouse Department only. No employees and directors can enter freely.

•Toenterthestrongroom(locatedinthewarehouse),itneeds2keysinsertingatthesametime

together with the combination lock. The keys and the combination lock will be possessed separately by the

three managers in different department who have no relationship with each other and are not acting as the

director or the major shareholder. Such method is regarded as internal control for the strong room in order

to check and balance.

To clarify, the strong room cannot be entry by one person but three persons who have no relationship

at least. Either employees or directors cannot come in this strong room freely. In addition, the combination

lock will be changed at least once a year. Moreover, the CCTV is attached inside the strong room.

Apart from the above, the company has other internal control systems to prevent the risk. Moreover,

the Audit Committee has provided the Internal Audit to conduct the Walk-through examination with the

employees and directors whether they have followed the company’s rules. Such Walk-through examination

will be conducted every quarter and reported to the Audit Committee.


26

3 Risk based on the difficulty in quantity and quality examination

The value of the diamond is based on the 4C which is color, clarity, cut and carat. Although the

feature of each diamond may be slightly different, the value is way too different. This is difficult to examine

the true value of the company’s inventory because the diamond may be changed and replaced among the

lower grade of diamond as indicated in the label. Without the best practice of internal control, it may affect

to the true value of the company’s inventory and cost including the deviation of the company’s income as

shown in the balance sheet.

However, for the risk of diamond replacement and the true value of the diamond as said above, the

company has policy and rule to control the product and quality in details below:

1. The company shall provide the serial code for material procurement in advance. Each serial code

will be categorized the feature of material applying for all kinds of diamond regardless there is no certificate.

2. The company shall record the material by examining all diamonds purchased by the company’s

expert prior to accept the product; thoroughly categorizing the material based on the feature of the diamond

according to the serial code after the diamond is in possession consistent with the purchase order and the

examination is made; and keeping such record at the Quality Examination Department.

3. After categorizing the material based on serial code, each material shall be stored at the strong

room. Such storage shall be followed with the category and serial code.

4. For production process of the finished goods, the company shall code each goods in the computer

system which identifies the material that is needed to use as categorized in the serial code thoroughly.

5. In term of material disbursement for production, the Production Department shall provide

the disbursement form as provided. The number of jewelry that is going to be produced, the serial

code of material and the number of the quantity shall be filled in the form for each production.

6. After the factory delivers the finished goods that is passed the examination including the feature

whether it is met with the requirements, the Production Department shall code such finished goods, print

the certificate from the system indicating clearly the quality, quantity and weight of the diamond together

with the image and store it at the strong room in order to transfer to the destination accordingly.

7. The jewelry that is ready to sell shall be labeled indicating the serial code and the certificate

together with the image attached so that the tracking will be easier to make.

8. For auditing, the company has provided the Accounting and Finance Department checks the

inventory which is material and jewelry possessed by the Warehouse and the Production Departments

at least once a month.

9. In term of returning the product from the customer, once the sale staff receives the product

from the customer, such product shall be returned to the headquarter in order to examine the feature of

the diamond before reproduction.


27

The above rules are set to control the quality of the diamond no matter there is a certificate provided

by the international institute or not; or it is the loose diamond or carat diamond or diamond jewelry. The

diamond where the certificate attached and issued by the international institute is more helpful to examine;

namely, all diamonds from HRD will be kept and sealed in the box delivered from abroad directly. Similarly,

the serial number of the diamond from GIA will be marked by laser at the edge of the diamond in order

to protect the replacement and to identify the particular diamond with accuracy and clearness so that the

examination can be made easier.

Moreover, the internal control and audit systems as well as the compliance as provided in 1.2 for the employ-

ees and directors can enhance the effectiveness of internal control system. Given the policies and rules, the company

strongly believes that the value and quality of the product shown in the balance sheet is reasonably correct and accurate.

4 Risk based on pricing and discount

Our sale is mainly focused in retail to the individual customers because the price of the diamond and

jewelry will be up to the feature of the diamond needed to have expertise and experience to indicate such

feature. More important, the price is also up to the customer’s satisfaction; therefore, pricing and discount

cannot be applied in the same basis. The price of similar jewelry cannot be the same or compatible. It is

difficult to examine whether the income will be recorded accurately while the primary rate of profit from

individual jewelry is highly fluctuation. As a result, it is uncertain to seek the integrity of the profit and

income.

However, the company concerns about the pricing and discount; therefore, it creates a policy to set

the threshold for pricing and discount based on product category applied to all branches. No salesman can

determine the price nor provide the discount independently.

In term of pricing, the threshold shall be based on product category according to the cost, design,

form including the types and price of the material. This shall be set as a standard applying for all branches.

The policy of pricing shall be determined and final by the Chief Financial Officer or “CFO”. If the pricing

is not appropriate, it could affect either the sale target when the pricing is too high or the primary rate

of profit when the pricing is too low. This also will be regarded as the performance indicator for the CFO

evaluated by the President and Board of Directors. In term of discount, it shall be inverse variation with the

rate of commission; namely, the commission shall be low if the discount is very high and vice versa. More-

over, the discount rate is arranged by tiers providing the maximum ceiling for the employees and directors

shall discount in different tiers. The maximum rate of discount shall be provided by the President with the


28

permission from the Board of Directors. However, such maximum rate of discount shall not be lower than

the original cost. In addition, the company has no policy to pay the remuneration in the form of commission

to the directors and other employees but salesman.

For the risk of correctness and completeness of the company’s income after the discount can be

arisen. For the example, the salesman sells the diamond without offering the discount to the customer for

X baht but returns to the company only Y baht while the rest of income is embezzled with its personal

interest. The net income of the company, as a result, may be deviated because of the discount policy.

Nonetheless, the company has realized this risk very well and taken action to protect such risk by

way of issuing the tax invoice and receipt as well as the warrant card indicating the sale price at all times.

Furthermore, the company has recorded every purchase of each customer in the customer database in

order to collect the points and reach to the prize while the customer can access this information as well.

Hence, this internal control system, which is designed to get the correct and accurate information related to

the diamond purchase from the customer directly and respond to the purpose of examination from the third

party, can minimize the risk.

5 Risk based on obsoleteness of the diamond jewelry inventory

The most important asset of the company is the inventory. On 31st December, 2012, the net asset

of the company is equal to THB 479.42 million or equivalent to 64.21% of the total asset and 96.03% of

the shareholders’ allotment. As the consumer still depends on the value of the diamond and design of the

product; as a result, the excessive in-trend design may be a problem when it is out-to-date. The company

has to unusually discount and affect to the profit of the company consequently.

However, the Board has been carried on its business more than 40 years and understood the

diamond jewelry industry very well. The Board, then, emphasizes to the design development of the jewelry

and the customer’s demand. The company has kept and analyzed the previous sale record, surveyed the

customer’s opinions and updated the trendy fashion. The company has also set up Product Development

Department and hired the full-time designer to design the product that meets with the customer’s demand

maximally. The design is simply classic but focusing the quality of the diamond mainly; therefore, the issue

of obsoleteness of the design is not the problem. Moreover, the company can recycle and reproduce the

jewelry which can reduce the cost of production around 3-5% and have less impact for the profit gain.


29

At the same time, the company has managed the jewelry inventory effectively. The company has

policy to protect the risk of each product by inserting the code over the product and collection, date of

production and year of design in the database and the price tag in order to estimate what kinds of product

are in the focus of the consumer or which category of the product is still left for inventory so that it could

plan to reproduce if the demand is high.

If any product has low demand or it is stored overtime to transfer from one place/ province/ region

to another, the company shall have the policy to manage the inventory reproduction; call the salesman all

branches to estimate the consumer’s demand; report and return the inventory in each design to the company

every month so that the directors can have adequate information to make the right choice to meet with the

customer’s demand maximally and mitigate the risk.

Moreover, in case the jewelry cannot meet with the customer’s demand, the company shall re-

design which may have to invest the cost of production around 3-5% without the cost of material.

6 Risk based on excessive dependence on directors and experienced and skilled

personnel

The company has been carried on its business under the name of “Jubilee Enterprise” more

than 20 years managed by the shareholders and Mr. Viroj Phonprakit, acting as the main Director and

Chief Executive Officer “CEO”. With knowledge, skill and experience related to diamond and diamond

jewelry, such as material supply, channel expansion for distribution and market expansion, are the key

factors that make the company’s performance and financial status has been growth constantly. It deems

that the main director contributes the risk in administration and management.

However, the company has followed the guideline for management by assigning the duties

and responsibilities to any other directors and employees instead. The company has set up the good

information collection and database including to exchange the relevant information between the directors

and employees frequently. Training, awareness raising and personnel investment have been provided

in order to understand the company’s goal and purpose and to avoid this risk when it is shifted to

another.


30

7 Risk based on investment expansion

The company has the plan to expand the branch in the future for the customer in Bangkok and

surrounding provinces in order to cover and respond the demands of all groups of customer. The shop

decoration and the revolving fund have been invested in the new branch. However, the company may face

the risk from such investment if the business cannot reach to the goal as set. In addition, it depends on

certain factors such as the economic situation in Thailand, the rate of interest and inflation, customer’s

behavior in each province, etc. In order to avoid the risk, the company has the investment plan analyzed the

market and the appropriateness for investment by the Business Development Department. This investment

plan will be presented to the Board in order to seek the possibility of investment including to open the new

branch in the shopping malls targeted many groups of customer. Those shopping malls are such as Central

Plaza, Robinson, the Mall, Tesco Lotus and Big C.

8 Risk based on currency exchange

The company has imported the material from abroad; therefore, the price offering and payment will

be made with the US currency mainly. Although, the material is imported from abroad, all products will be

distributed only in domestic. The rate of importation is approximately 70% from the gross materials. Moreover,

the price of diamond bought from the domestic distributor will be made in the U.S. currency according to

the traditional trade. If the value of the U.S. is low, it could reduce the cost of the company and vice versa.

In 2012, the company gained the profit for the currency exchange around THB 1.98 million.

The company has a policy to protect the risk based on currency exchange by way of Forward

Contract. It aims to prevent the risk from currency exchange around 50% to 100% of the gross purchase

from abroad. It is noted that the company has no policy to speculate the profit from currency exchange.

The Forward Contract will be subject to the Board’s determination. The Board’s determination will be based

on the currency exchange which is always followed up and the impact from such exchange. In addition, the

Forward Contract will be made immediately when it receives the product from the Sigthholder and records

the account payable in the company’s account.


31

9 Risk based on the price adjustment of material

The structure of the average cost is consisted of 3 parts which are 1) diamond as equaled

to 65-75% of the cost of the sale; 2) gold as equaled to 15-25% of the cost of the sale; and 3) the

production fee as equaled to 3-5% of the cost of the sale. This depends on the design of each product.

However, a diamond and gold are significant items that could affect to the cost of the company. The

more cost of material is up, the more cost of the company is growing.

The price of the diamond will be deviated in the global market. The company is then unable to

control the certain value of the cost. The price of the diamond during the 1st quarter at the year 2010 to

the 4th quarter of the year 2012 is as follows;

From the above table, it shows that the price of the diamond at 1 carat or upper will be deviated more

than the small size of diamond. Presently, the company has managed the risk by storing the diamond at the

size of 0.005 to 0.30 carat categorized in the non-substantial impact. For the diamond at 1 carat or upper,

it will be stored not exceeding than 15% of the gross inventory of the company. On 31st December, 2012,

the company has the diamond at 1 carat or upper as equaled to 3.73 of the net inventory. If the deviation

of the diamond’s price is existed, the Board believes that the company can manage the impact related to

structure of the cost and the profit capacity of the company from such deviation. For the example, such

management can either gain more profit if the price of the material is getting lower or adjust the structure

of the cost if the material price is getting high.

USD Per Carat


32

The company uses 18K gold for the jewelry while the price of the 18K gold will be deviated

according to the price of the 99.99% pure gold. The 18K gold combines between 75% of gold and 25%

of other metals so that it can mold the jewelry. Previously, the price of the 99.99% pure gold in the

global market has been changed as follows;

In addition, the price of the 99.99% pure gold in the global market has been changed substantively

since 2006 due to the weakness of U.S. currency. This increased the demand of the gold purchase because

it can prevent the risk from the adjustment of the U.S. currency. Once the demand is higher, the price of the

99.99% pure gold is more expensive. The price on June 2010 rose up to USD 1,242.60 per ounce and USD

1,404.90 per ounce later on December in the same year. The price went to USD 1,510.60 per ounce on June

2011 and kept rising up constantly at USD 1,566.40 per ounce later on December in the same year. Finally,

the price reached at USD 1,668.70 per ounce on March 2012 while it dropped to USD 1,599.10 per ounce

in June. However, the price swung back to USD 1,665.80 per ounce on December in the same year.

The company has managed such risk by making an agreement of the price at the date of production

when the hire of work is made. The agreed price to produce will be part of the criteria to compute the cost

so that the deviation of 18K gold will not cause any impact because the price has been agreed by both

parties. Moreover, in term of distribution, the company will price up from the cost of the product; therefore,

it does not really affect from the deviation of the material price.

10 Risk based on the supply of big diamond่

Due to the nature of the rough diamond and cutting technique, the big diamond has less demand

than the small ones. Ususally, the order of the big diamond shall be made in advance from the gemcutter

and take time more than the small diamonds. Moreover, it may be difficult to find the diamond as big as

it demands in the market.

In addition, the order to purchase the diamond bigger than 1 carat shall be made in advance

greater than or equal to 3-4 months. However, 90% of the order to purchase the diamond in the company

is less than 0.70 carat which can be available generally and meet with the demand of the market. Hence,

the company has never affected from the shortage of a big diamond before.

11 Risk based on the lease contract for the branch

On 31st December, 2011, the company had 95 branches focusing the individual customers and retail

purchase. These branches were located in the rental area belonged to the company totally 51 branches and

another 14 branches were belonged to the franchise distributors and located at the shopping mall and the


33

hypermart in Bangkok, surrounding provinces and other provinces. The company then had to rent the area

from the lesser in form of the lease contract; therefore, this could be the risk in case that the lease contract

cannot be renewed or the lesser wishes to change the condition or the rate of the rental in the contract. The

company may have to pay higher than previously. For the other 30 branches, they were as the GR Counter

which have no risk in the term of the contract.

On 31st December, 2012, the company had rental areas for 51 branches with the 3-years contract

and monthly paid. This could be a risk to renew the contract while the other 14 branches might have the

same trouble when they were run by the franchise distributors who made a lease contract without the direct

involvement of the company. However, the following facts that 1) the company has behaved itself to be a

good lessee constantly; 2) the company has been the top lessee among the others in the jewelry industry;

and 3) the company has had many branches nationwide have put the company in the position to bargain

with the lesser leading to the risk prevention.

12 Risk based on the issuance of the Employee Stock Option (ESOP) for the directors

and employees

From the Extraordinary General Meeting of Shareholders No. 1/2551 dated on 27th August, 2008,

the Board had resolution to issue the common share (“ESOP”) which indicated the specific holder and

non-transferable to the directors and employees for 5,000,000 units. The par value was of 0 baht while

it was longed for 5 years from the date of issuing and offering. ESOP 1 unit could buy 1 common share

because the value of the ESOP was equal to the par value of the share. The cost to pay higher than

the holder of the ESOP and the reduction price of the share could possibly happen for the investor.

If the holder of ESOP sells its rights, the investors may affect in EPS Dilution and Control Dilution.

This made the investor in the position to gain less profit and ownership of the company or equivalent

to 2.86%. The percentage was computed from all shares after the IPO which were totally 170,000,000

shares. For the of Price Dilution, it had no impact because the common share of the company has not

yet been registered as a stock in the MAI stock market; therefore the market price has not been set.

However, if the market price is needed to competence from the IPO, it shall affect the maximum price

from exercising the ESOP as equaled to 1.04%.

However, the said ESOP was provided with the condition to exercise within 1 year from the date

of issuing and offering. The holder of the ESOP can exercise its rights for the first time not exceeding 25%

of the gross ESOP that each holder shall gain distributed by the company. Every 12 months after the first

year, the holder may exercise its ESOP not exceeding 50%, 75% and 100% % of the gross ESOP that each

holder shall gain distributed by the company respectively. This aimed to protect the additional shares in the

beginning when the company got approval to enter into the MAI stock market because the ESOP could be


34

13 Risk based on the adjustment to exercise the Employee Stock Option (ESOP)

In the future, the company may adjust the exercise price and ratio of the ESOP due to the reduction

of the par value, dividend transformation to become a common share, etc. For the adjustment of exercise

ratio of the ESOP, any fraction lower than 1 share arisen from the adjustment shall be pulled out. For

the adjustment of exercise price, if the new exercise price is lower than the common share, the price of

common share shall be superseded. This could encourage the holder of the ESOP to buy less common

share of the company.

converted and become the common share if all holders wish to convert. As a result, it might reach to 5,000,000

shares or equivalent to 2.94% of the whole shares after the IPO and the exercise of the ESOP.


35

Shares of the Company

As at December 29, 2012, the company’s registered capital of 175,000,000 THB, with paid up capital

of 173,297,625 THB at par value of 1 THB per share

Dividend Payment Policy

The company’s dividend payment policy to shareholders with twice a year at the rate of not less

than 60% of net profit after corporate income tax and legal reserves. However, this depands on the

economic situation and the company operation performance.

Major Shareholder

10 Major shareholders’ report as of 29 December 2012 :

Shareholders

Mr. Viroj Phonprakit

Mrs. Suvatana Tulayapisitchai

Mr. Monchai Leesirikul

Ms. Unyarat Pornprakit

Mr. Akarapong Pornprakit

Ms. Ornrat Pornprakit

Mr. Jarasphan Panchasap

K SME Venture Capital

Mr. Kachen Benjakul

Mr. Naphat Panchakunathorn

Mrs. Chantana Luekajornchai

72,279,150

12,186,750

7,000,000

6,186,750

6,005,625

5,503,750

4,000,000

3,515,600

2,504,800

2,050,000

2,050,000

41.71

7.03

4.04

3.57

3.47

3.18

2.31

2.03

1.45

1.18

1.18

Paid Up Capital

Shares Percent

Shareholding Structure


36 Annual Report 2012 Jubilee Enterprise Public Company Limited

Board of Directors

Executive Committee

Corporate Secretary

Audit Committee

Internal Audit Office

Advisor of

Board of Directors

Chief Operating Officer

Director

Marketing

Department

Director

Sales

Department

Director

HR

Department

Director

Purchasing

Department

Director

F & A

Department

Director

Production

Department



Senior Deputy Chief

Executive Officer

The management structure of the company composes of 3 committees which are the Board of

Directors, the Audit Committee and Executive Committee. On 31st December, 2012, the organizational structure

of the company is as follows;

Criteria of the committee

The criteria of the committee is set in accordance with the Securities and Exchange Commission

(SEC) as follows;

•Ofthetotalnumberofboardmembers,atleastone-thirdandnofewerthanthreepersonsmust

be independent directors.

•TheAuditCommitteeshallhaveatleast3persons

MANAGEMENT STRUCTURE

Definition of committee

Executive means the authorized person who can manage and receive full time salary as

appointed to be the Director

Non-executive means the director who is not sitting as the executive and does not receive

the full time salary

Independent committee means the director who is not sitting as the Executive and qualified according

to the SEC


Qualification of the Independent Director

The Independent director of the company shall meet the qualification and have independent author-

ity according to the Securities and Exchange Commission and Stock Exchange of Thailand; namely,

1. It shall hold shares not exceeding 0.5 per cent of the total number of voting rights of the

company, its parent company, subsidiary, affiliate, or other juristic person who may have

conflict, including the shares held by related persons of the independent director;

2. It shall neither be nor have been an Executive, employee, staff, or advisor who receives

salary, or a controlling person of True, its parent company, subsidiary, affiliate, or other

juristic person who may have conflict unless the foregoing status has ended not less than

two years prior to the date of appointment;

3. It shall not be a person related by blood or registration under laws i.e. father, mother,

spouse, sibling, and child, including spouse of the children; of executives, major sharehold

ers, controlling persons, or persons to be nominated as executive or controlling persons

of the company or its subsidiary;

4. It shall not have a business relationship with the company, its parent company, subsid

iary, affiliate, or other juristic person who may have conflict, in the manner which may

interfere with his or her independent judgement, and It shall neither be nor have been a

major shareholder, a non-independent director or an executive of any person having busi

ness relationship with the comapny, its parent company, subsidiary, affiliate, or other

juristic person who may have conflict unless the foregoing relationship has ended not

less than two years prior to the date of appointment;

5. It shall neither be nor have been an auditor of the company, its parent company, subsidiary,

affiliate, or other juristic person who may have conflict, and not being a principal share

holder, or a non-indeoendent director, or an executive, or partner of an audit firm which

employs auditors of the company, its parent company, subsidiary, affiliate, or other juristic

person who may have conflict unless the foregoing relationship has ended not less than

two years from the date of appointment;

6. It shall neither be nor have been any professional advisor including legal advisor or financial

advisor who receives an annual service fee exceeding two million baht from its parent

company, subsidiary, affiliate, or other juristic person who may have conflict, and neither

being nor having been a principal shareholder, or a non-indeoendent director, or an Execu

tive, or managing partner of the professional advisor unless the foregoing relationship has

ended not less than two years from the date of appointment;

7. It shall not be a director who has been appointed as a representative of the company’s

director, major shareholder or shareholders who are related to the major shareholder;

8. It shall not have any characteristics which make him/her incapable of expressing indepen

dent opinions with regard to the company’s business affairs. The independent director

may be assigned by the Board of Directors to take part in the business decision of the

company, its parent company, subsidiary, affiliate, same-level subsidiary, major shareholder

or other juristic person who may have conflict on the condition that such decision must

be a collective one.


In 2012, the company had 5 Independent directors which is more than one-third of the whole Board

in order to ensure checks and balances. In addition, each Director in the current Board is the skilled and

experienced expert. The 8 Directors are devided as follows;

- 3 Executives

- 5 Independent Directors

The directors of the company shall have power and responsibilities to carry on their business in line

with the law, purpose and regulation of the company as well as the shareholders’ resolution with integrity

and due diligence as follows;

1. The Board shall determine goal, direction, policies, strategies, and budget of the Company and

ensure the Management’s compliance with the policies effectively unless the Board shall get approval from

the shareholder’s meeting prior to perform such as capital increase and decrease, debenture issuance, busi-

ness dissolution or partial or whole take-over, business purchase or acquisition, adjustment of memorandum

or regulation, etc.

Structure of the Board of Directors

The Board’s responsibilities

PositionName Length of term

Amonth of share

holdings*

Ratio of

share holding

Chairman of the Board /

Independent Director

Chairman of the Audit Committee /


Audit Committee / Independent Director


Independent director

Vice Chairman / President of Executive

Committee / Chief Executive Officer

Director / Deputy Senior Chief Executive

Officer

Director/ Chief Financial Officer

*Updated at the record date on 29th December, 2012

The company has corporate secretary and the advisor who provides the suggestion related to

regulations and relevant lawa that the Board shall know and follow for its own business including to

coordinate to ensure that the Board’s resolution will be complied.

2008 - present

2008 - present

2008 - present

2008 - present

2008 - present

2008 - present

2008 - present

1. Mr. Manu Leopairote

2. Mr. Amnuay Nakrachata-

amorn

3. Mr. Pirote Maleehorm

4. Ms. Zonwa Denmeka

5. Mr. Sahasroj Rojmetha

6. Mr. Viroj Phonprakit

7. Mrs. Suvatana

Tulayapisitchai

8. Ms. Unyarat Pornprakit

150,000 0.09

28,800 0.02

32,500 0.02

- -

75,000 0.04

72,279,150 41.71

12,186,750 7.03

2008 - present 6,186,750 3.57


2. The Board shall manage the company with knowledge, ability and experience to maximize the

benefit of the company in order to accord the law and regulations prescribed by the SEC and the SET,

purpose and regulations of the company as well as the shareholders’ resolution with due diligence in

order to protect the company’s interest and shareholders.

3. The Board shall consider the management structure and appoint the Executive Committee, the

Audit Committee, the chairman of the Executive Committee and other committee if it deems appropriate.

4. The director shall not operate any business which has the same nature as and is in competition

with the business of the company or become a partner in an ordinary partnership or become a partner with

unlimited liability in a limited partnership or become a director of a private company or any other company

operating business which has the same nature as and is in competition with the business of the company,

either for his or her own benefit or for the benefit of other persons, unless he or she notifies the meeting of

shareholders prior to the resolution for his or her appointment.

The regulation of the company provided that the director shall be appointed at the shareholder’s

meeting. The director greater than or equal to 5 persons and more than a half of the Board shall reside in

Thailand. In the case of a vacancy in the board of directors for reasons other than the termination of the

term of office, the board of directors shall elect a person who has the qualifications for the next meeting.

Any director wishing to resign from office shall submit his or her resignation letter to the company and the

resignation shall be effective from the date on which the company receives the resignation letter.

At every annual ordinary meeting, one-third of the directors shall vacate in proportion. If the number

of directors is not a multiple of three, the number of directors closest to one-third shall vacate. In addition,

a director who vacates office under this section may be re-elected. A directors shall vacate office upon:

1) resignation;

2) death;

3) being disqualified or being under any of the prohibitions under section 68 of the Public Limited

Companies Act, B.E. 2535 (1992);

4) removal by a resolution of the meeting of shareholders under section 76 of the Public Limited

Companies Act, B.E. 2535 (1992);

5) removal by a court order.

6) Subject to (1) - (5), A director shall terminate the term when the director have characteristics

indicating a lack of appropriatenessin respect of trustworthiness in managing business whose

shares are held by public shareholders as specified in Section 89/3 of the Securities and

Exchange Act B.E. 2551 (2008) notification of the SEC and shall not remain in his directorship

in the company according to Section 89/4 in the same Act.

Appointment, Resignation and Termination of the Director


In order to follow the good governance of the company and the the Securities and Exchange Act

(No. 4) B.E. 2551 (2008), the company, then, has appointed Ms. Patcharawalai Atichathipjinda as the corporate

secretary of the company having responsibilities according to the said Act as follows;

Corporate Secretary

1. preparing and keeping the following documents:

(a) a register of directors;

(b) a notice calling director meeting, a minute of meeting of the board of directors and an

annual report of the company;

(c) a notice calling shareholder meeting and a minute of shareholders’ meeting;

2. keeping a report on interest filed by a director or an executive;

3. performing any other acts as specified in the notification of the Capital Market Supervisory Board;

4. submitting a copy of report on interest in relation to management of the company or the subsidiary

to the Chairman and the Chairman of audit committee within seven business days from the date on which

the company has received such report.

Duties and responsibilities of the Corporate Secretary

The company has appointed the 2 committees in order to have duties and responsibilities as

specified as follows;

1. The Audit Committee

The Directors of the company have been appointed to sit in the Audit committee. They are qualified

according to the SEC and SET and consisted of 3 persons. One person among them, at least, is expertise

in accounting and finance. On 31st December, 2012, the Audit Committee has 3 independent directors sitting

in as follows;

1. Mr. Amnuay Nakrachata-amorn Chairman of the Audit Committee /

Independent Director Expertise in accounting and Finance

2. Mr. Pirote Maleehorm Member of the Audit Committee / Independent Director

Expertise in Accounting and Finance

3. Ms. Zonwa Denmeka Member of the Audit Committee / Independent Director

Expertise in Accounting and Finance

In addition, Mr. Warawut Sethanarug serves as the secretary of the Audit Committee and acts as the

senior Director of the Internal Audit Department who is subject to the Audit Committee’s supervision.

COMMITTEES

Duties and responsibilities

The company has devided duties and responsibilities of the chairman of the Board and the president

clearly in order to check and balance each other. The chairman will be an independent director and has no

relationship with the Executive Committee.


The Audit Committee has scope of duties and responsibilities as follows;

1. Financial Report

To ensure accuracy, completeness, punctuality and reliability of the financial statements and that

sufficient information is disclosed. This can be done by coordinating the auditor and Directors

who are in charge of preparation of the quarter and annual financial report.

Scope of Duties and Responsibilities

2. Internal control and audit

•TosetuptheInternalControlandAuditappropriatelyandeffectivelyandtoevaluatethein

dependency of both Departments. These departments shall be subject to the Audit Committee’s

supervision including the appointment, transfer, termination of the head of Internal Control

Department or other departments involving with internal control. The Audit Committtee shall

report its performance, update including conclusion / comments to the Board every times in

the meeting.

•Toconsider theauditplanandscopeof theauditconsuctedby the internalauditorand

external auditor on order to work with consistency and well-organized.

3. Legal and regulation compliance

To ensure that the company abides by all relevant SEC, SET and Capital Market Supervisory Board

(CMSB) rules and regulations, and other regulations and laws related to the company’s businesses.

4. Auditor selection and nomination

To consider, select and nominate any person who is independent to be appointed as the auditor and

determine its compensation including to attend the meeting together with the auditor without the

management department involved at least once a year.

5. Connected transactions

To evaluate connected transactions so they comply with the law and regulations stipulated by the

SEC and the SET, and that the transactions are reasonable and benefit the company.

6. Audit Committee’s Report

To prepare an Audit Committee’s Report, attached in the company’s annual report, signed by the

Chairman of the Audit Committee and composisted of at least the following information:

•Opinionsonaccuracy,completenessandreliabilityofthecompany’sfinancialstatements

•Opinionsonadequacyofthecompany’sinternalcontrolsystem

•CommentstheCompany’soncompliancewithlawsonrelevantSEC,SETandCapitalMarket

Supervisory Board (CMSB) rules and regulations, or laws applicable to the company’s businesses

•Commentsonsuitabilityoftheauditor

•Commentsontransactionsthatmayleadtoconflictsofinterest

•Numbers of the Audit Committee meetings and attendances of each of the Audit Committee members


In addition, the Audit Committee cannot approve any transactions or persons that may have the

conflict of interest or any other conflict against the company.

2. Executive Committee

The nomination of the Executive Committee consists of:

1. Mr. Viroj Phonprakit Chairman of the Executive Committee / Chief Executive Officer

2. Mrs. Suvatana Tulayapisitchai Executive Committee / Deputy Senior Chief Executive Officer

3. Ms. Unyarat Pornprakit Executive Committee / Chief Financial Officer

In addition, Mr. Yuttana Taepangthong is the secretary of the Executive Committee.

Based on the Board’s resolution No. 2/2555, the Director who is authorized to sign on behalf of

the company is Mr. Viroj Phonprakit together with Ms. Unyarat Pornprakit or Mrs. Suvatana Tulayapisitchai.

Two-third of these Directors shall co sign on the document with a company’s seal.

Director who has authority to sign on behalf of the company

The roles of the Executive Committee are mainly related to operate the business according to the

company’s objective and Articles of Association, and resolution of the Shareholders’ Meeting, or policies

and any orders ruled by the Board of Directors and to have power to approve or agree any activities in the

regular and necessity basis for business operation.

Moreover, the Executive Committee shall has responsibility to screen the issues in order to propose

to the Board of Directors for approval and/or ratification as ruled in the regulation and order of the Board of

Directors including the periodic order of the Board of Directors . The Executive Committee shall also perform

following activities propose to the Board of Directors for approval and/or ratification if it deems appropriate

for the business operation:

1) Policies, goals and annual plan

2) Annual budget of the company

3) Investment direction, policy and goal for guiding the management team

4) Remuneration structures and welfare for the employees

Scope of duties and responsibilities

•CommentsoroverviewobservationwhichtheAuditCommitteehasobtainedfromperformingin

compliance with the Charter

•Anyreportsconsideredappropriatefornotifyingcorporateshareholdersandgeneralinvestors

under the scope, duties and responsibilities as assigned by the Board of Directors

7. To execute other tasks as assigned by the Board of Directors, as agreed to by the Audit Committee.


The Executive Committee has responsibility to perform following activities under the scope that

provides particular issues:

1. To have the power to employ, appoint, terminate or transfer to the lower level or position,

abate or reduce the remuneration, award, distribute the bonus for the performance and value

of the employees including to dismiss, lay off, and discharge employees at the level and/or

position of the CFO and CEO except the Chairman of the Executives;

2. To procure or distribute the asset of the company which is not exceeding to THB 100,000,000

per each time and issue and shall not exceed the annual budget as provided and approved;

3. To do regular transaction with the bank or financial institution which the amont of transaction

shall not be over THB 100,000,000;

4. To rent or let out the asset of the company can be performed if the rate of the rent

of each asset is not more than THB 20,000,000 per year;

5. To donate for phiranthropic activity can be performed under the sum of THB 500,000 per

time and shall not exceed the annual budget as provided and approved;

6. To open or close down the branch of the company;

7. To control and set the direction for the business investment in other business as assigned

by the Board of Directors and provided by law;

8. To manage the company’s business according to the purpose, regulation, shareholder’s and/

or the Board of Directors’ resolution with no excuse;

9. To execute other tasks as assigned by the Board of Directors. Such tasks shall be subject

to the law and the company’s regulation including the relevant laws. If any member of the

Executive Committee involves with any tasks or person that may lead to the conflict of inter

est or contradict against the company, its subsidiaries or commercial purpose, S/he shall

not approve such tasks and report the Board of Directors in order to meet with the SET’s

rules and regulations.

The Chief Executive Officer (CEO) is the supreme position for management appointed by the Ex-

ecutive Committee to be responsible for performing the management plan and budget approved by the

Board of Directors strictly, carefully and integritily including to comply with the law, purpose, regulation and

the Board’s resolution with the concern of the company and shareholders’ interest and its own duties as

assigned by the Board of Directors.



The Management Team

On 31st December, 2012, there were 8 Executives as appeared below:

1. Mr. Viroj Phonprakit Chief Executive Officer

2. Mrs. Suvatana Tulayapisitchai Deputy Senior Chief Executive Officer

3. Ms. Unyarat Pornprakrit Chief Financial Officer

4. Mr. Warawut Settanarag Senior Director of the Internal Audit

5. Mr. Sophon Aroonsuraphonmaythee Marketting Director

6. Mr. Olarn Phirintharangkoon Sale Director

7. Mr. Yuttana Taepangthong Accounting and Fiannce Director

8. Mr. Varit Saimala Purchasing Director

The Chairman of the Executive Committee has the scope of duties and responsibilities as follows;

1. To manage the company’s business according to the purpose, regulation, shareholder’s

resolution or any policies and orders as ruled by the Board of Directors including to perform

some tasks assigned by the Board and to have power to order the employees in all levels

and positions.

2. To have power to approve or agree any activities in the regular and necessity basis for

business operation as follows;

- To have the power to employ, appoint, terminate or transfer to the lower level or

position, abate or reduce the remuneration, consider to promote, sanction, award,

distribute the bonus for the performance and value of the employees including to

dismiss, lay off, and discharge employees at the level and/or position of the manager

downward and the sale employees ar all levels and positions.

- To procure or distribute the asset of the company which is not exceeding to THB

50,000,000 per each time and issue and shall not exceed the annual budget as

provided and approved.

- To do regular transaction with the bank or financial institution which the amont of

transaction shall not be over THB 20,000,000.

- To rent or let out the asset of the company can be performed if the rate of the rent

of each asset is not more than THB 10,000,000 per year and shall not exceed the

annual budget as provided and approved.

- To donate for phiranthropic activity can be performed under the sum of THB 500,000 per

time and shall not exceed the annual budget as provided and approved.

3. To submit the following report to the Executive Committee;

- Quarter and annual turnover of the company including the goal comparison of the business

- Invesment performance including the monthly assessment

- Any other performance if the Executive Committee deems appropriate

4. To authorize any person to act as the agent on behalf of the Chairman according to its

assignment.

Scope of CEO’s duties and responsibilities


The Board of Directors consists of at lease five Directors, which not less than half of the number

of Directors must reside in the Kingdom and not less than three-forth of the number of Directors are Thai.

The Executive Board selection shall be approved from the shareholder’s meeting with the following rules

and means:

1. One vote per share is allowed for a shareholder.

2. The director may be voted for either as an individual or a party, depending on the direction

of the meeting. In each resolution, a shareholder must speak for a nominee or party with

all the ballots he possesses; the segregation of votes among nominees is not permitted.

The selected directors must win majority of the votes. In cases where the number of votes are equal,

the chairperson has the authority to make the final selection.

SELECTION OF DIRECTOR AND MANAGEMENT

Cash remuneration

The shareholder’s ordinary meeting dated on 23rd April, 2012, the meeting has approved the meet-

ing fee according to the company’s regulation Re: Annual remuneration and meeting fee of the director and

advisor of the company which was not exceeding the sum of THB 1,056,000 while the bonus was not more

than THB 726,000 per year. The details of meeting attendance and those payments for the direcotors and

executives as follows;

Stattistic of the Director and Executives’ attendance in the meeting during 2010-2012

Mr. Manu Leopairote




Mr. Sahasroj Rojmeka

Amnuay Nakrachata-amorn

Pirote Maleehorm

Zonwa Denmeka

1

2

3

4

5

6

7

8

5/5

5/5

5/5

5/5

5/5

5/5

5/5

5/5

6/6

6/6

6/6

6/6

6/6

6/6

6/6

6/6

Statatistic of attendance in the meeting

Name of the DirectorNo.

2010 2011 2012

DIRECTOR AND EXECUTIVES’ REMUNERATION

5/5

5/5

5/5

5/5

5/5

5/5

5/5

5/5


Chairman of the Board of Directors

Chairman of the Audit Committee

Vice Chairman


Executives

40,000

14,000

15,000

12,000

12,000

40,000

14,000

15,000

12,000

12,000

Type of directorship

Meeting fee

Meeting fee/time Meeting fee/time Meeting fee/time

2010 2011 2012

50,000

18,000

18,000

15,000

15,000

Salary

Bonus

Provident Fund

Totle

15,031,980

1,741,950

450,959.40

17,224,889.40

17,722,970

3,585,195

495,989.10

21,804,154.10

7

7

7

8

8

8

8

7

8

Executives’

remuneration

Executives

2010 2011 2012

The company has set up the provident fund for the Executives and employees and it is their choice

to exercise that benefit. The company shall pay at the rate of 3% of their basic salary.

17,945,763

5,455,516.70

538,072.89

23,939,352.59

Other remuneration

The company has offered the benefit to the Directors and employees in the form of the common share

(“Employee Stock Option : “ESOP”) which indicated the specific holder and non-transferable to the Directors

and employees for 5,000,000 units in order to appreciate and encourage the Directors and employees for

comtributing the achievement of the company previously. The Board of Directors have been distributed the

ESOP as follows;


Mr. Manu Leopairote




Mr. Sahasroj Rojmetha

Mr. Amnuay Nakratchata-amorn

Mr. Pirote Maleehorm

Ms. Zonwa Denmeka

1

2

3

4

5

6

7

8

200,000

249,000

249,000

249,000

100,000

155,000

130,000

130,000

4.00

4.98

4.98

4.98

2.00

3.10

2.60

2.60

0.11

0.14

0.14

0.14

0.06

0.09

0.07

0.07

Name of DirectorNo.

Number of Unit that

has been

distributed for

ESOP

Percentage of

ESOP

Percentage of gross shares

that can be exercised the

ESOP after the IPO and

rights exhausted

The rate of distribution of the ESOP shall be based on the duration of work with the company, current

position and duties and responsibilities.

The duration of work shall be counted since the date of comencement until 31st August, 2009. The

fraction of the year shall be deemed as a year unless the duration of work is less than 1 year. It is noted

that this shall not apply with the Directors (the duration of work shall be deemed as zero for the Director).

In addition, if the any person has been distributed the ESOP for both position of Director and Executive,

such distribution shall be abated.

Apart from the above, the Directors and the Executives of the company at the level of department upward

shall not receive other remuneration but the regular remuneration such as salary, bonus and meeting fee.

The Jubilee Enterprise Public Company Limited has realized the good corporate governance under

the SET’s guideline and regulation. The company believes that the good corporate governance can reflect

the efficiency, transparency and accountability. This could build the trust and confidence to the shareholder,

investor, stakeholder and other relevant parties leading to the growth of the company sustainably. The company

has carried good corporate governance constantly with the hope that the Board and management team will

comply and adopt with the good corporate governance which is in line with the international standards and

enhance its in the future if it deems approapriate and consistent with the dynamic situations.

The company has the written policy on good corporate governance, notifies the Directors, Executives and

employess to follow in order to build the work culture in the organization and enhances the effectiveness of

the management system which is the fundamental of sustainability of the company. The Board, executives

and employees have adhered the good corporate governance and disseminated this including the ethical

code through the company website at www.jubileediamond.co.th.

1. Role of shareholders

The company has realized and concentrated the shareholders’ right and does not violate or deprive

shareholders’ rights as the owner of the Company. The company has also encouraged the shareholders to

exercise their fundamental rights. Those rights are such as share exchange or transfer of shares, profit shar-

ing, access of the information and meeting participation fot voting, appointing and removing the directors,

appointing the auditor and approving the special resolution and etc. During 2012, the company organized

and operated as follows;

Shareholder’s meeting

On 2012, the company organized the Annual General Meeting of shareholders with the following

details:

CORPORATE GOVERNANCE

• The2012AnnualGeneralMeetingofshareholdersdatedon23rd April, 2012 at 14.00 p.m.

in Four River, 1st Fl., Ramada Plaza Menam Riverside Bangkok located at No. 2074,

Charoenkrung Rd., Bang Kho Laem District, Bangkok 10120. The total participants were 135 person

where 101 person were the shareholders and the other 34 person were proxy. The total countable

shares based on the number of the participants were 121, 477, 307 shares whichwere

equal to 70.51% of the ordinary and paid-up shares. The Board composed of the Chairman

of the Board, the Directors and the Audit Committee totally 8 persons including

the executives and the auditor participated in the meeting. The Chairman was acting

as the chair of the meeting and followed all rules completely provided by law.

The process of the meeting was as follows;


49

• Prior to the meeting

1. The company send the notice to the shareholders through the SET system so that the

minority shareholders can acknowledge the right to propose the agenda in the meeting as

well as the nomination to sit as the director according to the selection process provided

by the company’s regulation and disseminated through the company’s website at www.

jubileediamond.co.th/investor relation. There was no agenda or nomination to be appointed

as the independent director in the 2012 annual ordinary general meeting of shareholers.

2. The company disseminated the schedule and agendas of the meeting through the SET

system and the company’s website in advance for 30 days prior to the meeting.

3. The company send the invitation of the meeting indicated the venue, date, schedule and

agendas including the Board’s comment in each particular agenda as well as the proxy

form and annual report for further consideration. The letter and related documents was sent

to all shareholders whose name appeared at the record date in order to to acknowledge

in advance for 14 days and publicized in the daily newspaper for 3 days.

4. The shareholders who cannot attend the meeting by themselves could send their proxy

to act as an agent on their behalf in the meeting.

• Duringtheshareholders’meeting

1. The compamy facilitated the meeting to all shareholders with no preference and discrimination.

There were the receptionists to assit the shareholders sufficiently. The shareholders could

registered for the meeting at 12.30 p.m. which was 2 hours before the meeting. All Directors

and Executives including the auditor joined the meeting altogether.

2. The company applied the barcode system for the participartory registration and voting.

3. The company organized to use the ballot in every agendas in oder to be transparent and

accountable.

4. Priot to the meeting, the Chair of the meeting inform the number of the participants and

explain how to vote with the ballots to the self-participatory shareholders and proxies.

5. The Chair of the meeting carried on the meeting as set in the invitation without changing

the schedule and agendas or considering the other issues where were not in the agdas.

6. The Chair of the meeting informed and clarified all agendas while all shareholders had

equal rights to exercise and examine the company’s performance including to follow up

and express their optinions. The meeting was recorded all substantive matter in the minute

in order to check the correctness of the meeting.

7. Any resolution shall be final by the majority vote. One share will be one vote for any resolutions

unless it was about 2012 annual remuneration. The resolution was accorded by the

two-third of the shareholders’ votes in the meeting while they were qualified to vote.


2. Equitable Treatments

The company has treated all shareholders with equality and fairness no matter they are majority or

minority shareholders, institutional investors or foreign investors and also ensured to the shareholders that

the Board and management team have spent the capital appropriately because it believes that these are the

key factors to build trust and investment in the company. The Board has responsibility to ensure that the

shareholders’ fundamental rights will be protected and treated in the equal basis.

50

8. Prior to vote, the Chair of the meeting would allow the shareholders to ask the question

and details for clarity.

9. The Chair of the meeting carried on the vote with the transparent manner.

10. The meeting allowed the shareholders to appoint the individual directors.

11. During the meeting, if there were any additional shareholders, the company shall recount

the number of the shareholders and shares every time for any additions. The new comers

shall vote only the agendas that have not been voted yet. In addition, the Chair of

the meeting would conclude the vote in each agenda and inform the shareholders to

acknowledge. Such information shall be indicated the number of the votes of approval,

disapproval and absention.

• Intermsofproposingtheagendasandnominationforthe2012annualordinarygeneral

meeting of shareholders, the company sent the letter to the shareholders through the

SET system and the company’s website in order to porpose the agendas according to

the company’s regulation. This ensured that the minority shareholders can appoint the

independent director for taking care their benefit on their behalf. Howevrer, there was no

agenda or nomination to be appointed as the independent director in the 2012 annual

ordinary general meeting of shareholders.

• TheBoardorganizedthemeetingthattreatedallshareholderstobetreatedequallyand

allowed the proxy to act as an agent on behalf of the shareholders through the Khor. Form

(Proxy form) which was attached with the invitation letter for the meeting indicating the

document / requirements including the process of authorization so that the shareholders

could prepare with no problem during the meeting.

• Duringtheshareholders’meeting

1. After the meeting, the company informed the resolutions through the SET system with the

details of resolution and voting in each agenda to the public.

2. The company made the written minute and diseeminated within 14 days after the meeting

through the company’s website.


Measures to prevent the use of inside information by Directors, management, and employees for abusive

self-dealing or for the others

The company shall not discriminate or treat inequally in favor for any other groups. All shareholders

have rights to access the public information through certain channel with the equal basis. Such treatment shall

be fair and enough for the information disclosure. The ways to access this information are as shown below:

Tel : 0-2266-5700 ext. 400

Website : www.jubileediamond.co.th/investor relation

E-mail address : [email protected]

51

• TheBoardacknowledgedtheconnectedtransactionsandconsideredtheappropriateness

of such transactions with prudence by following the SET and SEC regulations and disclosed

the information related the name and relationship of connected person in the annual report

and 56-1 Form so that the shareholders can check easily.

• Thecompanyset theresponsibilitiesof theExecutivesanddepartment related to the

confidentiality. The Directors, Executive or any person who hold the confidential information

of the company shall not share nor disclose the information, which may cause an adverse

impact to the general shareholders, to the outsiders or whom has no relevant duties

unless it is for public dissemination according to the SET regulation.

• ThecompanyprovidedthattheDirectorsandExecutivesshallsubmitthesecuritiesholding

report including the change of such holding to the company

1. Raise awareness to the Directors and Executives for the duty to submit the securities

holding report for themselves, their spouses minors including the penalty according to the

Securities and Exchange Act B.E. 2535 and the SET regulation;

2. Provide the executives submit the securities holding report to the SEC according to Section

59 of the Securities and Exchange Act B.E. 2535 and the company at the same day;

3. Inform the executives and employees that whoever holds the financial and other information

of the company that is substantive and led to the price of the securities shall avoid to

trade the company’s security within 1 month prior to disclose such information to the

public and keep in confidentiality to the other person.

The company has policy to prohibit the Directors, Executives and employees using the inside

information which is substantive and not publicly available for their self-interest or for the others including

for the share trading. The measures to prevent such risk are as follows;


If the Directors, Executives and employees fail to comply with the given measures, the company

shall proceed the disclipinary action in various means as it deems appropriate. Such means are verbal warning,

written warning, salary reduction, work suspension, termination without the compensation or prosecution. In

2012, there was no such act that violated the SEC and SET regulations nor did have the share trading by

using the inside information conducted by the Directors and Executives within 30 days prior to inform the official

company’s income through the SET system.

Information disclosure to the stakeholders

The Board agreed to have the guideline on the information disclosure to the Directors and

Executives’ stakeholders for the sake of transparency and protection of the comflict of interest as follows;

3. Role of Stakeholders

The company has realized the environment and social responsibility including the interest in all groups

and harmonized with them appropriately in order to ensure that all rights are protected and exercised. The

company has provided the guideline to comply in order to respond the stakeholders’ needs clearly and

disseminated it to the Board, Executives and employees to adhere and implement it as key compliance.

During 2011, the company added the good practice and developed the stakeholders’ treatment constantly.

i.e., anti-corruption practice, prevention of the human rights abuses and efficient and worthwhile use of

resources. The practice of good governance in different stakeholder shall be clarified below:

52

1. The Director shall inform the company promptly when the Director and its family members

involve or hold the share in any businesses that may lead to the conflict of interest; or

receive either direct or indirect benefit from any contracts where the company is the party;

and or hold the company’s securities.

2. In case that the employee and its family members involve or hold the share in any

businesses that may be contradict to the company’s business, the employee shall inform

in written to the CEO.

3. The Director and Executive shall inform the information to the company’s Secretary and

the Board and refrain to express any opinions or vote in any agendas that cause the

conflict of interest.

• Shareholders – the company carried it business with integrity, openness and good

governance in order to grow sustainably. The company also respects the shareholders’

rights disclosing the information for assessing the company management. Such information

were the company’s performance, financial status and suppoting information disclosed

within the due period in oder to be transparent and fairness with the shareholders.


53

• Community and Environemnt – the company implemented the policy on Corporate Social

Responsibility : CSR, social focus and philanthropic activities into its business directed by

the Board. The company contributed and involved the CSR activities with the following

foundations and organizations in 2012 constantly:

- Donate the 9 Fiber boats with engines to Wat Hat Yai community in Hat Yai District,

Songkhla Province in order to assist and relieve those who were affected from the

inundation while Dr. Rungroj Kaupanich (MD.), the Deputy Mayor of Hat Yai, was

authorized to received.

- Voluntarily repair and clean the clock tower at Lumpini Park with free of charge in order

to dedicate merit to his majesty the King of Thailand.

For other activities, the company continued to support constantly. For the example, the

company financially supported the National Fund for Empowerment of Persons with

Disabilities under the supervision of the Ministry of Social Development and Human

Security at the sum of THB 162,060 and joined the activities related to educational

support in various universities.

• Customer – the company has dedicated to help the customer’s satisfaction with the

products many factors, i.e., the condition of the product, the price, excellent service which

respond its needs. The company has carried on its business with fairness and has a

policy related to confidentiality and customer’s benefit as a priority. Also, the company

has allowed the company to complain or ask for information all the time through various

means such as website, telephone, company’s branches, facebook or ect.

• Partner and/or Creditor – the company has treated the partner and/or the creditor

according to the trade condition and agreement. The company shall not operate the

business with the bad faith and cover any information or fact that could damage the

creditor. The Executives or employees shall not ask for or accept assets or other benefits

which are dishonest to trading with trade partners and/or creditor. In case there are

grounds to believe that there is request or acceptance of assets or other benefits which

are undue, company or the trade parner and/or the creditor shall jointly seek solutions

and prevent the risk that will be arisen again the future. In addition, the company has

complied with loan conditions, i.e., the purpose of the loan, payment, security, and other

covenants, made with the financial institutions and it, previously, never breaches of

contract with them before.


4. Disclosure and Transparency

The company has ensured that the financial report and corporate information are provided correctly,

accurately and on time through the SET channels and the company’s website at www.jubileediamond.co.th

constantly.

For communication between the company, shareholders and investors, please contact Mr. Yuttana

Taepangthong, Director of Accounting and Finance or E-mail at: [email protected]

54

• ThecompanyhasperformeditdutytotheStatebyoperatingitsbusinessunderthelaw

and regulations strictly and coordinating to disclose the complete and correct information

to the State when requested in order to be transparent, confident and credible.

• Competitors-Thecompanyhasconducteditsbusinesswithinaframeworkoffreeand

fair competition by following the fair competition guideline and avoiding the dishonesty

to destroy the opponents. The company had no trade dispute against the competitiors in

the previous year.

• Employees–thecompanyhasclearandconcretepolicyrelatedtosafety,welfareand

employees’ benefits. The company has treated the Executives and employees equally and

provided the reasonable bonus. The provident fund has been set up in order to secure the

employees’ stability in the long term. The company has set the policy and practice realted

to self-developments such as training, professional education for the the sale employees

at the in-house or out-house including the personality development for the employees.

• The company believes that the quality of the financial report is significant for the

shareholders and outsiders. The Board, then, shall ensure that the information in the report

is correct, consistent with the auditing standards. Moreover, it also shall be examined by

the independent auditor appointed by the Audit Committee composing of the independent

directors who are in charge of financial report and internal control. In addition, the Board,

Audit Committee and the auditor’s reports shall be appeared in the annual report.

• The investor relations is responsible for communicating and supplying the important

information to the investors, shareholders, securities analyst, and ordinary people. The

activities related with the investor relations in 2012 were as follows;

1. To attend the Opportunity Day for 4 times

2. To attend the Analyst Meeting for 4 times

3. To organize the Thank Press Party for 1 time


55

• Tocomplyitsresponsibilitieswithduediligenceandintegrityincludingtofollowthelaw,

purpose, company’s regulation and the Board and shareholders’ resolutions with the

concern of the shareholders’ interest fairly and to reasonably conduct under the same

circumstances. During 2012, the company lawfully carried on its business and did not

violate the SEC and SET regulations.

• Topromoteandapprovethepolicyonthegoodgovernanceinwrittenandtomonitor

such policy at least once a year.

• Toprepare theethical code inwritten forallDirectors,Executivesandemployees to

understand the ethical standard that the company applies in its operation and to ensure

the strict compliance.

• Toconsidertheconflictofinterestbyhavingtheclearguidelineandfocusingthecompany

and shareholders’ interest mainly while the stakeholder has no participation to make deci-

sion unless it is the transaction that has commercial terms as those an ordinary person

would agree with unrelated counterparty under similar circumstances, on the basis of

commercial negotiation and without any dependent interest resulted from the status of

the Directors, Executives or related person, as the case may be, or it is the commercial

agreement approved from the Broad or accorded to the principle that has been approved

by the Board as well as to supervise the complicance, disclosure information related to

the conflict of interest accurately and completely.

5. Board Responsibilities

The Board has duty and responsibility to conduct good governance in order to take reasonable

care to the shareholders and stakeholder such as business strategy, performance assessment and business

transparency.

The Board has leadership, vision and independent to determine the maximum interest of the company

and shareholders overall. It then divides duties and responsibilities between the Board and management

team clearly and ensures that the business is carried on lawfully and ethically.

The Board composes of 50% independent directors who are qualified and experiences in meaningful

way for the company. They have dedicated and put their effort to strengthen the growth of the company.

Role, Duties and Responsibilities of the Board of Directors

The Board considers and determines the business operation such as vision and mission, strategy,

financial goal, risk, plan and budget, etc. including to supervises, controls and ensures that the management

team will follow the policy and plan as provided effectively and efficiently.


56

• Tohavethecontrolsysteminfinanceandlegalandpolicycomplianceandprovidethe

independent person or department monitoring the control system as well as to review

such system at least once a year.

• Toconsider theoverallRiskManagementbyallowingthemanagementteambeing in

charge of complying and reporting the Board regularly and to review the system and

assess such risk management periodically whether the risk has been changed including

to alert in precaution and certain unusual transactions

• To consider the criteria and forms of remuneration for theBoard, the President and

approve the remuneration of the President while the Directors and the Board’s remuneration

will be proposed and approved by the shareholders’ meeting

• ToconsiderthecriteriaandtheprocessoftheDirectorsandExecutivesselectioninclud-

ing to nominate the candidates according to the selection process and propose to the

shareholders’ meeting for the appointment

Term of Director

The selection process of the director for the appointment of the shareholders is transparent

without any dependent interest resulted from the controlling shareholders or management team and credible

for the outsiders.

Every annual ordinary meeting, one-third of the directors shall vacate in proportion. If the number

of directors is not a multiple of three, the number of directors closest to one-third shall vacate. In addition,

a director who vacates office under this section may be re-elected.

Removal of the Board of Directors

Apart from the removal of the Board of Directors because of completing the term according to

the Securities and Exchange Act B.E. 2551 (2008), A directors shall vacate office upon:

1. death;

2. resignation;

3. being disqualified or being under any of the prohibitions under section 68 of the Public

Limited Companies Act, B.E. 2535 (1992);

4. removal by a resolution of the meeting of shareholders under section 76 of the Public

Limited Companies Act, B.E. 2535 (1992);

5. removal by a court order.


57

Self-evaluation of the Directors

The company shall evaluate the Directors’ performance every year in order to compare in each

category and year of performance. This is aimed for improving and developing the Directors’ performance

in line with the good practice of directorship.

Evaluation of CEO

The company shall evaluate the President’s performance every year based on the goal and criteria

of the evaluation connected with the achievement of the plan.

Role, Duties and Responsibilities of the Audit Committee

In order to be effective and efficient for the Board’s performance, the Board then has appointed

the Audit Committee to assist in the financial report, internal control system and legal, regulation and ethical

compliance for the good governance. The Internal Control shall submit its report to the Audit Committee

to examine if the compliance has been done, how the result is as well as how it shall propose the recom-

mendation and assess the quality of the Audit Committee’s report.

The Board of Directors will appoint the Audit committee. They are qualified according to the

SEC and SET and consisted of 3 persons. One person among them, at least, is expertise in accounting and

finance.

Board of Directors’ meetings

• ThecompanyprovidestheBoardofDirectors’meetingsinadvanceatleastonceaquarter

and notifies the schedule together with the agendas and other supplementary document

prior to the meeting so that the Directors can participate and prepare for the meeting.

• The Chairman of the Board and CEO shall consider the agendas for the meeting

by ensuring that the matter issues have been inserted. In addition, each Director is

independent to propose its agenda in the meeting.

• TheChairmanoftheBoardshallhavesufficienttimetomanagethemeetingcompared

with the agendas and debate among the Directors and encourage the Directors to make

a decision with prudence and pay attention to proposed agendas including the good

govenrnace.

• Everyyear,theindependentdirectorsshallhavetheirownmeetingiftheydeemappropriate

in order to discuss certain issues related to management without management team.

• TheBoardshallencouragethePresidenttoinvitetheExecutivesparticipatingtheBoardof

Directors’ meetings in order to provide additional input as they have direct involvement.

• TheBoardshallaccesstheadditionalinformationifitdeemsnecessaryfromthePresidentor

other Executives or any authorized person within the scope of the policy as provided.


58

Remuneration

• Thedirector’sremunerationshallbeincomparisonwithothercompaniesthataresimilar

size, experiences, mission, scope of accountability and responsibility including the expected

benefit and the additional task of from each Director. i.e, the Director who is sitting in the

Audit Committee shall have additional remuneration.

• CEO’sremunerationshallbebasedontheprincipleandpolicyprovidedbytheBoard

and the maximum benefir of the company. However, the remuneration in the form of

salary, bonus and long-term incentive shall be consistent with the company’s performance.

Development of the Directors and Executives

The Board provides the orientation to all new directors in order to prepare and understand the

nature of the business and performance. The company’s Secretary will coordinate following matters;

1. Business structure, Direcotor structure, scope of duties and responsibilities and relevant

law

2. General business and guideline for business operation

The Board provides the orientation to all new directors in order to prepare and understand the

nature of the business and performance. The company’s Secretary will coordinate following matters;

Executive Succession Planning

The executive succession planning is made in order to ensure that the company will have the

Executive who is knowledgeable, skilled and experienced to perform its duties and responsibilities. The

executive succession planning has been prepared as follows:

1. The Board provides the executive’s capacity training for the preparation of the executive

succession planning in all positions.

2. The Board assigns the HR Executives to follow up the training and develop the knowledge

and capacity of the successor.

3. The Board provides all directors attending the Executives’ meeting in order to

understand the experience and prepare to manage the organization in the future.

Conflict of Interest

In order to prevent the conflict of interest, the company then provides the guideline for the

Directors, Executives and employees to comply as follows;

The Audit Committee shall be responsible for complying and performing as assigned by the Board

while the responsibility in all kinds of business operation toward outsiders shall be subject to the whole Board.


59

Information Disclosure on the Conflict of Interest

The company has provided the Directors and Executives to prepare and disclose the conflict of

interest report. Such report shall be submitted to the Internal Control who can supervise and cope with the

conflict of interest. Previously, the conflict of interest was not yet existed.

1. No Director may either carry on or accociate as a partnership or hold the shares in

any business of the same nature and compete against the company unless he or she

notifies the meeting of shareholders prior to the resolution for his or her appointment.

2. Management and employees must not use insider information for either trading the

Company’s securities or damaging the shareholders. Such use shall be included to

information disclosure to the relevant person.

3. In case that the company has connected transaction report or acquisition or disposal

of material assets, the Directors and management tram shall comply the compnay’s

procedure: organizing the meeting to condiser and shape the report; examining and

passing the report from the Audit Committee with the concern of the maximum interest

of the company and shareholders; avoiding to participate in the meeting if the Directors

or Executives have a conflict; supervising to comply with the provided procedures once

the report get approval by the Directors; and disclosing it through various channels in

order to acknowledge entensively and equally.

4 Directors, Executives and employees shall not make use of opportunities or data derived

from their directorship, executive position or job performance, for their own or other

people’s benefits, by entering a business that competes with the company or related

businesses


Cash remuneration

Salary and Bonus

Commission fee

Provident fund

Employee’s welfare

Total

33.64

34.54

1.03

3.99

73.23

34.03

40.10

1.06

0.54

75.83

46.70

51.44

1.44

1.84

101.42

2010Type of remuneration 2011 2012

60

Employee

On 31st December, 2012, the company have had 250 employees which can be listed down accoding

to the following departments:

Marketing and Product Development

Sale and Promotion

Production

Accounting / Finance

Human resources amd General Administration

Purchasing

Total

12

126

21

15

7

2

183

12

148

20

14

7

2

203

17

181

23

16

11

2

250

Number of employees

Department

2010 2011 2012

The company has promoted the employee’s welfare based on the economy and livelihood such as

- Employee’s uniform

- Provident fund

- Medical reimbursement / Collective health care insurance

- Grant-in-aid for certain occasions such as wedding, funeral and ordination / Grant-in-aid

for victim in the emergency situations such as inundation, conflagration and etc.

- Leisure activities for the purpose of the employee solidarity and coordination such as

New Year celebration or other congratulation events.


61

Employee recruitment and selection

The company emphasizes in employee recruitment by providing the test to check the knowledge,

capacity, attitude and skill in each position and expects all employees to be skillful and happy to work.

Employee Development Policy

The company pays attention to develop the employee’s capacity in knowledge, mentlal health

and ethic. Awards such as Best seller, Best employee in the category of behavior, virtue and ethic will be

given for the purpose of moral support based on the generousness toward colleague and customer and

work behavior/discipline.

The company has orientation for new employees and training for a whole year. Also it has

constantly encourgared them to participate the meeting, seminar and academic training related to the work

directly and indirectly in order to develop their capacity and prepare for the industrial competition.

Apart from training and employee development, the company also concerns the career progression

in each profession. It has provided preparation plan for the employees who have progression and grow

together with the achievement of the company. The progression can be based on weakness improvement,

strength enhancement and self-evaluation as well as the supervisor’s evaluation. Moreover, it also has

provided an opportunity for the employees to prove their wisdom during the work so that they can be

promoted in the upper level and stay with the company for long.

Maintenance of the work condition

The company has improved and managed the work condition for employees with the hope that

they can work within the good environment; concerned the sanitation and safety of life and property; and

launched the campaign to resfrain from all vices and drugs.



INTERNAL AUDIT

Audit Committee had evaluated adequacy of internal auditing systems of the Company though interactive

communications with relevant administration sections and surveys of questionnaires on adequacy of

internal auditing systems of the Company responding to five main components as: the organization and

surroundings;risk management; control of operations of administration sector; information technology and

communication system; and monitoring system. The Board of Directors of the Company and Audit Committee had

inspected and found that currently the Company has set up internal auditing system on process of

transaction adequately responding to main shareholders, Members of the Board of Directors, executive staff

members or any affiliating party with such person. And for internal audit under other matters of the internal

auditing system, the Board of Directors of the Company and Audit Committee had inspected and found that

in present the Company has set up internal auditing system on process of transaction responding to their

requirements with adequacy.

And in reference to the account auditing of a chartered accountant in the accounting year round in

2012, the Company was recommended with given observations on internal auditing system of the Company,

and the Company then improved a more appropriateness system, the Board of Directors of the Company and

Audit Committee had inspected and supervised the improvement responding to those observations, nevertheless

there was none of impact towards reliability and trustfulness of the financial statement of the Company in 2012.

RISK MANAGMENT

Recently, the Company arranged the risk management within its structure for ensuring its operation

with management in efficiency. The high-ranking executive staff-members of the Company were appointed

to be members of the Committee on Risk Management with duties on issuance of the policies on risk

management and administrative systems with efficiency responding to all aspects in need.


RELATED TRANSACTION

Activated

Activated

สถานะ

The Company had related transaction or any person by nature that shall be in conflict. The Company delicately takes the relationship of

relevant individuals or businesses into account and perceives them on actual engagement rather than legal binding or forming of contracts, this also

include sanycompanies with executive member or person whom shall be in conflict and be in position of the Committee and/or main shareholder in

presentand shall be one with suspicion on conflict of interest on business operation in the future of these companies. This might form interactions

between the Jubilee and such companies. The affiliating companies, in this regard, comprises as follows:

11.1 Name list of relevant juristic persons that shall be in conflict:

CompanyType of Business

Affiliating person(s) in

charge of member (s) of

the Board of Directors

List of InteractionRemarks

Share-holding

(in percent)

Relationship with the

Company/member(s) of


1. The Jubilee

Jewelry Manufacture

Company Limited;

1) Miss Ornrat Pornprakit;

2) Miss Chanabhorn Pornprakit;

3) Mr. Rath Pornprakit;

4) Mr. Boonrith Pornprakit;

5) Mr. Soontorn Pornprakit;

6) Other persons without

conflict;



conflict;

There is none of business co-

operation and is a business

competitor, but there is none

of selling order since 2006.

Trade of jewelry

Trade of jewelry

Mr. Viroj’s daughter;

Mr. Viroj’s older sister;

Mr. Viroj’s younger brother;


Mr. Viroj’s father;


N/A

N/A

14

14

14

14

16

28

1

99

Currently, this Company has

terminated its trades on decora-

tions and ornaments; it is running

a business on rental of property.

2. The Bangkok

Diamond and Pre-

cious Stone Exchange

Company Limited;*

3. Zui Hua Partnership Trade of jewelry 1) Mr. Soontorn Pornprakit;




30

10

N/A There is none of business

cooperation and is a business

competitor.

Activated

Current Status


4. Zui Hua Syndicates

Limited

5. J.B. Assets

Company Limited;

Activated

Activated

1) Mr. Boonchai Pornprakit;


3) Mr. Rath Pornprakit;

4) Ms. Malee Pornprakit;

Trade of jewelry;1) Mr. Soontorn Pornprakit;


3) Mr. Boonchai Pornprakit;


5) Mr. Rath Bhornprakit


conflict;

1) Mrs. Suvatana

Tulayapisitchai;

2) Mr.Viroj Phonprakit;

3) Miss Unyarat Pornprakit;

There is none of business co-

operation and is a business

competitor.

It runs different type of business,

and there is none of business

cooperation. The Head Office of

J.B. Assets Company Limited,

in the past, was located in 6th

floor of Tiew Hong Building where

currently is the Office of Board

of Directors and executive staff

members of Jubilee and as per

the date of 30 September 2009,

the J.B. Assets Company Limited

is located on Ramindra Road.

Mr. Viroj’s older brother;



Mr. Viroj’s mother



Mr. Viroj’s older brother;



Mr. Viroj’s wife and member

of Board of Directors;

Member of Board of Directors;

Mr. Viroj’s daughter and

member of Board of

Directors;

N/A

N/A

10

10

10

30

16

14

14

14

14

28

80

16

4

Rental of Office

Buildings;

Company Type of Business




List of Interaction RemarksShare-holding

(in percent)




Current Status


6. On-Nut Diamond

Company Limited;

7. C.K. Diamonds

Company Limited;

8. K and C Lands Real

Estates Company Limited;

Activated

Activated

Activated

It runs different type of business,

and there is none of any busi-

ness cooperation.

It runs different type of busi-

ness, and there is none of

any business cooperation.



conflict;

1) Mr. Charn Tulayapisitchai;


conflict;


Suvatana’s older brother;

N/A

N/A

N/A

9

91

40

60

Rental of Lands;

Development of

Property;

1) Mr. Charn Tulayapisitchai;


conflict;

40

60

Suvatana’s older brother; It runs different type of business,

and there is none of any busi-

ness cooperation.

Development of

Property;

* Mr. Soontorn Bhornprakit had resigned from a member of the Board of Directors of the Bangkok Diamonds and Precious Stone Exchange Company Limited, since 20th February 2009.

There is only one company running similar business thatone member of the Board of Directors of Jubilee is a member of Board of Directors and/or main

shareholder, as the Jubilee Jewelry Manufacturer Company Limited. This Company established an agreement with Jubilee as: “there will be not any business, either

direct or indirect, or taking part, either direct or indirect, or any operation affiliating with business of production and distribution of diamond ornaments and diamond

in karat or any other businesses competing with businesses of the Jubilee Enterprise Public Company Limited, including to distribute or supply raw materials to

a person or juristic person whom is hired for production of goods for the Jubilee Enterprise Public Company Limited” and the Diamond Jubilee Partnership shall

not use brands of “Diamond Center” and “Jubilee Diamond” in any matters. In additional, the Company shall not establish any mutual interactionwith the HuiZui

Diamonds Partnership and Zui Hua Syndicates Company Limited

Company Type of Business




List of Interaction RemarksShare-holding

(in percent)




Current Status

9. Hang Yu Zeng

Company Partnership

ActivatedIt runs different type of busi-

ness, and there is none of

any business cooperation.

1) Mrs. Suvatana

Tulayapisitchai;

2) Mrs. Sukanya Aramsinchai;

3) Mrs. Kachoo Saeteow;


conflict;

Mr. Viroj’s wife and member

of Board of Directors;

Ms. Suvatana’s older sister;

Ms. Suvatana’s mother;

N/A16

16

16

52

Molding of cop-

per and brass

items, coins, to-

kens or amulets;


11.2 List of related transactions between person (s) / juristic person (s) that shall be in conflict:

The list of related transactions between persons/juristic persons that shall be in conflict in 2011 and 2012 shall be presented as follows:

Person(s) / juristic

person(s) that shall

be in conflict

Relationship

Type and Detail of Related

transactions

Opinions of the Auditing Committee on

Necessity and Justification of Interactions

Ending in the Year

31 December

2011

31 December

2012

Setting of Prices and

Condition

Mr. Supasith Klaikem

and the Jubilee

Enterprise Public

Company Limited;

Mr. Supasith Klai-

kem is a permanent

employee of the

Jubilee Enterprise

Public Company

Limited;

It responds to same prices and

conditions of other enterprises

with contracts in similarity of

franchise of the Company.

Due to a wife of Mr. Supasith Klaikem was running

a business of trades of ornaments in similarity with

other enterprises holding contracts in similarity of

franchise of the Company. Therefore she con-

tacted the Company with request for installment

of contract with the Company in the name of her

husband. The Committee examined and opined

that such request fallen into regular conditions

with justifications for business. On 30th Decem-

ber 2011, Mr. Supasith Klaikem had requested to

terminate such contract with the Company and

returned all goods to the Company. The Company

noted such returns and set-up liability in category

of other creditors. The Committee examined and

opined that such report fallen into regular condi-

tions with justifications for business.

3.76

N/A

0.18

5.87

-

For the J.B. Assets Company Limited; On-Nut Diamond Company Limited; C.K. Diamonds Company Limited; K and C Lands Real Estates

Company Limited; and Hsu Zeng Company Partnership, they all are running types of businesses in difference with the Jubilee, therefore there is none

of agreement, while they all are competitors of the Bangkok Diamond and Precious Stone Exchange Company Limited, Zui Hua Diamonds Partnership

and Zui Hua Syndicates Company Limited

1. The Company has sold goods and

diamond ornaments to Mr. Supasith

Klaikem, in total value covering selling

price, services between periods and

pending payment at the end of period,

in detail as follows:

- Selling of goods;

- Service fees;

- Remaining of payment of debt;

- Other creditors;

(Unit: Million Baht)


MEASURES WITH PROCEDURES ON RELATED TRANSACTION

According to the Committee’s Resolution no.4/2551, dated 7th June 2008 (Company Limited) and

Committee’s Resolution no.5/2552, dated 21st October 2009, there are procedural measures on related

transaction as follows:

The transactions between the Company and any relevant party or person who might have conflict

shall be enlisted in the transaction between the Company and any relevant party or person who might have

conflict and shall be in compliance with the condition of regular trading or transaction under similar trading

agreement that a reasonable man shall make with a contract party in general at the same situation with

power on negotiation of trading and without any influence from status of member of the Board of Directors

and executive staff member or a person who might have conflict, as the case maybe, under reasonable

conditions that shall be examined and not cause transference of benefits.

The Company shall prescribe measures with procedures on making of related transactions between

the Company and any relevant party or person who might have conflict, for a case of making of mutual

interaction in type of regular trading, e.g. selling of goods of the Company under the price list to a person

who might have conflict in regular price and ordinary trading condition without giving of any favorable

discount beyond the scope of power of the Chair of Operation Officers and in equivalence with other clients,

etc. And in case that making of such mutual interaction is out of the price list or not generated in ordinary

list of sale, the stakeholders, for this instance, shall not be able to participate in granting of approval on such

matter, the Company shall entrust the Auditing Committee with authorities for giving of approval on bases of

necessity, justification and appropriateness. The making of such matter shall be considered on case-by-case

basis. And in case that the Auditing Committee shall not be knowledgeable on consideration of such mutual

interaction, the Company shall entrust an independent knowledgeable person with expertise on examination

and valuation to give opinions on such mutual interaction to the Auditing Committee or share holders as

the case maybe, for granting of approval before making of interaction. In additional, the Auditing Committee

shall be able to examine and review existing interactions in every quarter and shall consider policy on related

transactions in ordinary list of sale in every year.

The Board of Directors of the Company is obliged to supervise operations of the Company to act in

compliance with laws on securities and stock exchange, obligations, notifications, orders or regulations of the

Stock Exchange of Thailand or Office of the Securities and Stock Exchange Commission or of the Capital Market

Commission or of the Securities and Stock Exchange Commission, including the operations under regulations

for disclosure of information on linking interactions and obtain or distribution of significant assets of the Com-

pany. The Company shall disclose such related transactions and publish them within the footnotes to financial

statement audited by an auditor of the Company, in a form of 56-1 and annual report or any information, in

accordance with prescriptions of the Stock Exchange of Thailand and relevant organizations.


POLICIES AND TENDENCY ON MAKING OF RELATED TRANSACTIONS

For the making of mutual transactions in the future, the Company whereas its Board of Directors

and executive staff members taking accountability shall act in compliance with regulations on making of

interactions with affiliating persons or persons who shall be in conflict. The stakeholder shall be encouraged

to participate in consideration of approval on any matters that he might be in conflict on other any benefit

with the Company and shall reveal such matter to the Board of Directors of the Company for consideration.

The Company shall act in compliance with laws on securities and stock exchange, obligations, notifications,

orders or regulations of the Stock Exchange of Thailand, of Office of the Securities and Stock Exchange

Commission, of the Capital Market Commission and of the Securities and Stock Exchange Commission.

The Company shall not allow any loan or guarantee on loan to affiliating persons or persons who

shall be in conflict furthermore.

The Company shall make a contract and agreement with Mr. Soontorn Pornprakit on using of areas

for establishment of a branch of the Company without any charge and shall not indicate the date of expiry,

unless the Company has requested to terminate this contract and agreement.

Meanwhile, the Company does not hold any policy on selling of goods and raw materials for any

person affiliating with groups of Mr. Viroj Phonprakit in all cases.


Director and Management Team

Name & Position Age Education

Working Experience

Period Position Company

Percent of

share holding

Relation among

family within the

company

1. Mr. Manu Leopairoj

Chairman /


Chairman / Independent

Director

Audit Committee

Chairman

Chairman

Chairman

Chairman of Audit Committee

Chairman

Permanent Secretary

Jubilee Enterprise Public Company Limited

Thai Beverage Public Company Limited

(Listed in Singapore)

Khon Kaen Sugar Industry Public Company Limited

Bangkok Union Insurance Public Company Limited

Polyplex (Thailand) Public Company Limited

Siam Steel International Public Company Limited

ARIP Public Company Limited

Ministry of Industry

Honorary Doctoral Degree in Business

Administration, Thammasat University

Master Degree M.Sc. (Econ.) University of

Kentucky, USA

BBA (Economics) (magna cum laude),

Thammasat University

Diploma, National Defence College (34th)

Director Accreditation Program (DAP)

30/2003 by Thai Institute of Directors (IOD):

Course Role of Chairman Program (RCP)


Sahapanich School

Director Accreditation Program (DAP) 72/2008

by Thai Institute of Directors (IOD):

Director Certification Program (DCP)


2. Mr. Viroj Phonprakit

Vice Chairman /

Executive Director /


Vice Chairman /



Jubilee Enterprise Public Company

Limited

70

61

-

Suvatana’s husband

and Unyarat’s father

2008–present

2008 – present

0.09

41.71

1999-2004


3. Mrs. Suvatana Tulayapisitchai


Deputy Senior Chief

Executive Officer

Executive Director / Deputy

Senior Chief Executive Officer

Director


J.B Asset Co., Ltd.

Convent of the Infant Jesus School





The Master of Science in Marketing

Program (MIM), Thammasat University

Bachelor of Business Administration

Accounting Assumption University

Certification, Institute of Gemological

Sciences, USA


72/2008 by Thai Institute of Directors

(IOD):


113/2009 by Thai Institute of Directors

(IOD):

4. Ms. Unyarat Pornprakit






J.B Asset Co., Ltd.

59

33 Viroj and Suvatana’s

daughter

Viroj’s wife and

Unyarat’s mother

2008 – present

2004 – present

2008 – present

2004 – present

7.03

3.57


Working Experience


Percent of

share holding

Relation among

family within the

company


5. Amnuay Naruchata-amorn

Chairman of Audit

Committee / Independent

Committee

Chief Financial Officer 10/2008 by

Federation of Accounting Professions

Winner of Business Plan Competition (Asia

Moot Corp)

First Runner Up of Business Plan Competi-

tion (Global Moot Corp) Texas, USA

Second Runner Up of Business Plan

Competition (New Venture Championship)

Oregon, USA

57 MBA Kasetsart University

Mini MBA Thammasat University

Bachelor of Business Administration

Ramkhamhaeng University

Bachelor of Science in Chemical,

Chulalongkorn University



Audit Committee Program by Thai Institute

of Directors (IOD):

Chairman of Audit Committee /

Independent Committee

Executive Director


Selic Chemical Company Limited

- 2008 – present

2002 – present

0.02


Working Experience


Percent of

share holding

Relation among

family within the

company


57

Monitoring the quality of Financial Reporting

(MFR 7/2009 by Thai Institute of Directors

(IOD):

Monitoring the System of Internal Control

and Risk Management (MIR 5/2009) by

Thai Institute of Directors (IOD):

Monitoring the Internal Audit Function

(MIA 5/2009) by Thai Institute of Directors

(IOD):

Monitoring Fraud Risk Management (MFM

5/2011) by Thai Institute of Directors (IOD):

6. Sahasroj Rojmetha



Director Sales & Retail Central

Support

Director Sales & Service


True Distribution and Sales Company Limited

True Corporation Public Company Limited

Doctoral Degree in Marketing, US

International University San Diego California

MBA Tarleton State University

MBA in Management,

Chulalongkorn University

Bachelor of Accounting, The University of the

Thai Chamber of Commerce





- 2008 – present

2012 – present

2004 – 2012

0.04


Working Experience


Percent of

share holding

Relation among

family within the

company


8. Zonwa Denmeka

Audit Committee /



Singha Paratech Public Company Limited

54

2008 – present

2003 – 2011

0.02

MBA Kasetsart University

Bachelor of Business Administration in

Accounting, Sukhothai Thammathirat Open

University


Management Sukhothai Thammathirat Open

University



Audit Committee Program (ACP) 35/2011 by


Audit Committe /


Senior Production Director


Energy Teamwork Limited

Advance Engineering Company Limited

Than Printing Company Limited

Metro Mall Development Company Limited

- 2008 – present

2012 – present

2008 – 2011

2003 – 2007

-

7. Pirote Maleehorm

Audit Committee /


MBA Sukhothai Thammathirat Open University

Bachelor of Engineering Program in Civil

Khon Kaen University



Audit Committee Program (ACP) 35/2011 by


62 -

Audit Committee /


Financial Controller

Director - Finance & Accounting

Manager - Finance & Accounting

Director - Finance & Accounting


Working Experience


Percent of

share holding

Relation among

family within the

company


9. Warawut Settanaraj

Senior Director - Internal

Audit Office and

Secretary to Audit

Committee

10. Yuttana Taepangthong

Finance & Accounting

Director

11. Varit Saimala

Purchasing Director

Senior Director - Internal Audit

Office and Secretary to Audit

Committee

Senior Vice President

Accounting Advisor

Finance & Accounting Director and

Secretary to Executive Committee

Finance & Accounting Manager

Purchasing Director

Purchasing Manager


S Y K Factory and Product Company Limited

S Y K Sparepart Industrial Company Limited


Jubilee Enterprise Company Limited


Jubilee Enterprise Company Limited


Accounting, Ramkhamhaeng University


Accounting, Bangkok University

Chief Financial Officer 13/2010 by Federation

of Accounting Professions

Bachelor of Business Administration in Mar-

keting, The University of the Thai Chamber of

Commerce Certification,

Institute of Gemological Sciences

52

40

46

-

-

-

2008 – present

2004 - 2007

2004 - 2007

2008 – present

1994 – 2008

2008 – present

1993 – 2008

0.01

0.04

0.1

12. Sophon Aroonsura-

phonmaythee

Marketing Director

Product Manager

Product Manager


Timedeco Corporation Company Limited

Lux Asia (Thailand) Company Limited

MBA in Marketing Chulalongkorn University

Bachelor of Journalism and Mass Communi-

cation (Advertising) Thammasat University

2010 – present

2008 – 2009

2002 – 2007

33 -

-


Working Experience


Percent of

share holding

Relation among

family within the

company

SUMMARY OF REPORT ON AUDITION

Certified Public Accountants with entrustment of the Jubilee Enterprise Public Company Limited,

in the past, shall be enlisted as:

• In2010,

Mr. Prawit Viwanthananut, a Certified Public Accountants with license number 4917,

from the ANS Audit Co., Ltd.;

• In2011,

Mr. Prawit Viwanthananut, a Certified Public Accountants with license number 4917,


• In2012,

Mr. Bunjong Pitchayaprasat, a Certified Public Accountants with license number 7147,


And an auditor of the Jubilee Enterprise Public Company Limited had reflected his findings in

reports of auditing under his revision as follows:

In 2010, A Certified Public Accountants had reflected with unqualified opinion and

opined that the financial budget presenting financial status on the date of

31st December 2010, with results of operation and cash flow at the end of

year with same date of the Company was accurate in substantive matters,

in accordance with the chartered accounting principles.


opined that the financial budget presenting financial status on the date of 31st

December 2011, with results of operation and cash flow at the end of year

with same date of the Company was accurate in substantive matters, in

accordance with the chartered accounting principles.


opined that the financial budget presenting financial status on the date of

31st December 2012, with results of operation and cash flow at the end of

year with same date of the Company was accurate in substantive matters,

in accordance with the chartered accounting principles.


CONCLUSION OF FINANCIAL STATUS AND RESULTS OF

PERFORMANCE


BUDGETS WITH PRESENTATION OF FINANCIAL STATEMENTS

(Unit : Million Baht)

AUDITING AUDITING AUDITING

ITEMS 31st December 2010 31

st December 2011 31

st December 2012

Amount Percent Amount Percent Amount Percent

ASSETS

Current Asset

Cash and deposit in financial institute(s); 129.45 21.88 75.79 11.71 29.93 4.01

Short-term investment; 30.46 5.15 60.26 9.31 98.11 13.14

Account receivable; 62.97 10.64 54.34 8.39 76.75 10.28

Inventory; 293.90 49.67 384.72 59.44 479.42 64.22

Other current asset; 11.58 1.96 8.36 1.29 10.82 1.45

Current asset in total; 528.36 89.30 583.47 90.14 695.03 93.10

Deposit in financial institute(s) with

obligation for guarantee; 37.50 6.34 25.00 3.86 - -

Building and equipments, in net; 15.10 2.55 24.81 3.83 34.38 4.61

Entitlement for rental, waiting for

deduction in net; 5.94 1.00 6.66 1.41 4.55 0.61

Earnest money; 4.68 0.79 7.34 0.76 12.60 1.68

Non-current asset in total; 63.32 10.70 63.81 9.86 51.53 6.90

Assets in total; 591.75 100.00 647.28 100.00 746.56 100.00

Debt and portion of share-holder(s);

Current Liability

Short-term loan from financial institute(s); - - - -

Creditor of trade - other; 169.07 28.57 153.31 23.68 171.06 22.91

Debt with due of payment in 1 year; 7.08 1.20 7.70 1.19 8.66 1.16

Other short-term loan; - - - -

Income tax payable; 14.93 2.52 16.62 2.57 22.10 2.96

Accrued liabilities; 27.39 4.63 - -

Other current liabilities; 17.49 2.96 24.16 3.73 36.42 4.88

Current liability in total; 205.01 34.65 201.79 39.17 238.24 31.91

Long-term loan from financial institute(s); 13.33 2.25 6.67 1.03 - -

Debt under the rental contract; 0.52 0.09 1.26 0.20 3.72 0.50

Obligations for benefits of employees; - - 3.53 0.55 5.35 0.72

Non-current liability in total; 13.85 2.34 11.46 1.77 9.07 1.22

Debt in total; 218.86 36.99 213.25 32.95 247.31 33.13




st December 2011 31

st December 2012


Portion of share-holder(s);

Registered capital on due of payment; 171.12 28.92 172.29 26.62 173.30 23.21

Exceeding of share values; 92.27 15.59 92.27 14.25 92.27 12.36

Accumulated profit (lost) with allocation as

reserved under the laws; 14.54 2.46 17.50 2.70 17.50 2.34

Accumulated profit (lost) with none of

allocation; 94.96 16.04 151.98 23.48 216.19 28.96

Portion of share-holder(s) in total; 372.89 63.01 434.03 67.05 499.26 66.87

Debt and portion of share-holder(s)

in total; 591.75 100.00 647.28 100.00 746.57 100.00

All-Inclusive Profit and Lost Statement




st December 2011 31

st December 2012


Gains from purchasing orders and services; 689.12 100.00 887.32 100.00 1,226.23 100.00

Capital for sales and services; 397.71 55.10 497.67 56.09 716.02 58.39

Gross profit; 309.41 44.90 389.65 43.91 510.21 41.61

Cost of sales and administration; 183.14 26.57 226.12 25.48 305.45 24.91

Cost of operations; 126.27 18.33 163.55 18.43 204.76 16.70

Profit from exchange rate; - - - - - -

Other gains; 4.38 0.64 3.30 0.37 4.69 0.38

Profit (lost) before accrued interest

and corporate income tax; 130.65 18.97 166.83 18.80 209.45 17.08

Accrued interest; 0.96 0.14 1.30 0.15 0.95 0.08

Corporate income tax; 25.96 3.77 34.35 3.87 42.63 3.48

Net profit (lost); 103.73 15.06 131.19 14.78 165.87 13.52

Profit (lost) per share (Thai baht); 0.61 0.77 0.96

Average ordinary share with equipoise; 170.17 171.29 172.44


ITEMS

1 Jan - 31 Dec 1 Jan - 31 Dec 1 Jan - 31 Dec

2010 2011 2012

Cash Flow Statement


Cash flow from operating of activities;

Profit before income tax; 129.69 165.53 208.50

List of items with modifying with impact towards profit before

income tax, in cash gained from operating of activities;

Depreciation; 5.32 7.73 14.15

Entitlement for rental, waiting for deduction, in net; - - -

Debt with suspicion on lost (reversing of list); (0.01) 0.23 (0.20)

Lost from impairment; 0.03 - 1.61

Profit that shall not actually emerge of asset for trade; - - (0.19)

Profit (lost) from exchange rate that shall not actually emerge; 0.43 1.91 (0.13)

Obligations for benefits of employees - 3.53 1.82

Accrued interest receivable; (1.10) (2.96) (1.86)

Accrued interest; 0.81 1.30 0.95

Profit from operation before change of asset and debt on

operation; 135.17 177.27 224.65

Change of asset and debt on operation;

Decrease (increase) of account receivable; (10.17) 8.63 (22.64)

Decrease (increase) of inventory; (68.32) (88.45) (95.33)

Decrease (increase) of current asset; 3.63 (3.47) (2.41)

Decrease (increase) of other assets; (0.77) (2.82) (5.04)

Deposit in financial institute(s) with obligation for guarantee; (24.72) 12.50 -

Decrease (increase) of creditor(s) of trade; 64.61 (17.69) 17.88

Decrease (increase) of other current liabilities; (0.38) 10.23 12.26

Cash payable to income tax; (28.25) (32.66) (37.15)

Net gained cash (spending) for operating of activities; 70.80 63.54 92.22


Cash flow from investment activities;

Short-term investment; (30.46) (29.80) (12.67)

Purchasing of equipments; (6.14) (14.04) (17.50)

Purchasing of intangible asset; (0.81) (2.22) (0.06)

Receipt of interest; 1.10 2.85 2.02

Net cash paid for investment activities; (36.31) (43.21) (28.21)

Cash flow from fund-raising activities;

Increase (decrease) of over-with drawal of money

from the account; (2.96) - -

Receipt of long-term loan from financial institute(s); 20.00 - -

Payment of short-term loan from financial institute(s); (7.35) - -

Payment of long-term loan from financial institute(s); (13.68) (6.67) (6.67)

Payment of debt on contract of rental for money; (0.46) (0.56) (1.62)

Cash received from increase of capital on ordinary share; 1.12 1.17 1.01

Payment of interest; (0.74) (1.30) (0.95)

Payment of dividend; (61.21) (73.57) (101.65)

Net gained (spent) cash in fund-raising activities; (65.28) (80.93) (109.88)

Increase (decrease) of cash and in equivalence-net; (30.79) (53.66) (45.86)

Cash and in equivalence on the date of beginning

of the year; 160.24 129.45 75.79

Cash and in equivalence on the date of end of period; 129.45 75.79 29.93

ITEMS

1 Jan - 31 Dec 1 Jan - 31 Dec 1 Jan - 31 Dec

2010 2011 2012


Table for Presentation of Financial Ratio with Significance

ITEMS UNIT 2010 2011 2012

LIQUIDITY RATIO

Liquidity ratio; fold or time 2.58 2.89 2.92

Liquidity ratio, in fast circulation; fold or time 1.09 0.94 0.86

Liquidity ratio, in cash flow; fold or time 0.41 0.34 0.42

Circulation ratio, of account receivable; fold or time 10.84 15.06 18.56

Duration of debt collection, in average; day 33.21 23.90 19.40

Circulation ratio, of inventory; fold or time 1.46 1.47 1.66

Duration of sales of goods, in average; day 246.58 244.90 216.87

Circulation ratio, of creditors; fold or time 3.32 3.09 4.41

Duration of payment of debts; day 108.43 116.50 81.63

Cash circle; day 171.36 152.30 154.64

Profitability Ratio

Gross profit ratio; percent 44.90 43.91 41.61

Profit ratio from operation; percent 18.32 18.43 16.70

Profit ratio, other; percent 0.63 0.37 0.38

Cash ratio per operation with profit; percent 57.24 42.31 45.04

Profit ratio, net; percent 14.96 14.73 13.47

Compensation ratio, for shareholders; percent 29.55 32.52 35.54

Efficiency Ratio

Compensation ratio, from assets; percent 19.18 21.18 23.80

Compensation ratio, from permanent assets; percent 741.31 695.98 608.28

Circulation ratio of assets; fold or time 1.28 1.44 1.77

Financial Policy Ratio

Ratio of debts and portion of shareholders; fold or time 0.59 0.49 0.50

Capacity ratio, in interest payment; fold or time 122.45 80.85 142.59

Capacity ratio, in payment of obligations; fold or time 0.56 0.49 0.59

Ratio for payment of dividends; percent 60.61 69.66 62.51

Note: * Adjustment of base on annual basis;


DESCRIPTION AND ANALYSIS ON FINANCIAL STATUS AND RESULTS OF

OPERATION

OVERVIEW OF OPERATIONS

The Company runs a retail trading for diamonds and diamond ornaments which is a business with

high competition among a number of small enterprises, but such goods are return high profit per unit while

the rate of preliminary profit of goods in same type might be different depending on values of raw materials

at manufacturing process, and the Company shall dictate pricing with discount of such goods. The procure-

ment services for products of the Company shall be classified into two main processes as the supplying for

diamond as a readymade commodity and raw material, and then hiring a manufacturer to produce designated

ornament. Such process of business is similar with an order of purchasing from manufacturer to distribute;

therefore the Company shall be able to avoid bearing of costs of investment in permanent assets. While it

can spend more investment on current capital for purchasing and collection of products for sales, since they

need to be variety in forms and designs responding to diverse buyers. One of the success factors for this

business thus relies on management of inventory and liquidity management with efficiency.

The retail trading for diamonds and diamond ornaments shall set up initial selling price, in very high

level, while volume of sales in each time shall not be high, comparing with manufacturing and exporting of

ornaments and decorations, therefore the Company focuses on huge groups of clients with continual expansion

of coverage for create more net profits, in additional the Company steadfastly set up branches in provinces

countrywide with retain of adequate stocks in each branch responding to diversity of demanding. Several

means for management of inventory with more efficiency are introduced and applied for cost-effectiveness

with value-adding in stocking of products, while the security management with insurance has been activated

upon risk management and preventive measures from robbery and corruption.

The Company holds two main types of products as: 1) ornaments and decorations; and 2) diamond

in karat, and of course, ornaments and decorations might create more values with gain of higher profits

rather than diamond in karat, while some pieces of ornaments and decorations shall earn more profits than

other pieces too.

In 2010, the turnover with circulation of services of the Company were extended from the past,

in 25.70 percent or approximately 140.89 million baht, the increase of turnover with circulation of services

around 22.45 percent had come from growth of existing branches of the Company and around 3.25 percent

had come from opening of new branches, increasing from 73 units to be 78 units.

In 2011, the turnover with circulation of services of the Company were extended from the past,

in 28.76 percent or approximately 198.20 million baht, the increase of turnover with circulation of services

around 24.38 percent had come from growth of existing branches of the Company and around 4.38 percent

had come from opening of new branches, increasing from 78 units to be 79 units.


Sales Volume in Quarterly Basis

Million

Baht

2010

2012

2011

2nd Quarter 3

rd Quarter 4

th Quarter1

st Quarter

And in 2012, the turnover with circulation of services of the Company were extended from the

previous year, in 38.19 percent or approximately 338.86 million baht, the increase of turnover with circulation

of services around 29.22 percent had come from growth of existing branches of the Company and around

8.97 percent had come from opening of new branches, increasing from 79 units to be 95 units.

And for the gist of festive moods in different seasons, they create only tiny impact to turnover of the

Company, statistically in the fourth quarter of every year, the Company shall hold highest turnover, compar-

ing with other quarters, since there are two main festive events - Christmas and New Year, with moods of

give and take for presents. The turnover in each quarter shall be presented as follows:

In 2012, the turnover with circulation of services of the Company was rapidly increased, in equivalence

with 338.86 million baht or in rate of increase 38.19 percent, comparing with same period of the year 2011.

And although in the year 2012, the overall economy was declined with deceleration because of the

economic crisis with contraction, while the rate of unemployment was increased and created more psycho-

logical impacts on purchasing power, nonetheless the executive body of the Company still reaffirmed and

believed that the jewelry business sector was steadfastly moving with positive tendency. And in reference to

marketing survey on ornaments and decorations of the Company, the executive body had forecasted with

estimation that the Company shall hold market share around 12 percent of market value in a counter group,

or in equivalence with 2 percent of value from overall market, while it shall be gradually increased with exten-

sion of service coverage from building of department stores in provinces, e.g. the Tesco Lotus, countrywide.

The Company had established a strong relationship with two prominent department stores and asked for a

favor with priority for selection of selling areas, while according to marketing analysis; consumers’ behaviors in

upcountry were gradually changed in similarity with those residing in Bangkok and mega cities with increase

of purchasing power.


The ratio of income from sales in Bangkok and those in provinces of the Company was changed

from the past as: in 2009, the ratio of income from sales in Bangkok and those in provinces would be 50.72 :

40.28 in percentage of income in total; in 2010, the ratio of income from sales in Bangkok and those in

provinces would be 50.57 : 42.72 in percentage of income in total; in 2011, the ratio of income from sales

in Bangkok and those in provinces would be 57.28 : 42.72 in percentage of income in total, because of the

growth of existing branches in Bangkok was higher than those in provinces; and in 2012, the ratio of income

from sales in Bangkok and those in provinces would be 58.49 : 41.81 in percentage of income in total, the

same because of the growth of existing branches in Bangkok was higher than those in provinces.

In 2010, the Company earned net profit in 103.73 million baht, while in the same period of 2009, the

Company earned net profit in 60.24 million baht. The increasing amount would equal with 72.19 percent, as

the rate of refining margins had been increased from 40.90 percent to be 44.90 percent and rate of corporate

income tax in 2010 was decreased from 2009, as from 30 percent to be 20 percent and caused increase of

net profit higher than the turnover with circulation of services of the Company in same period of previous year.

In 2011, the Company gained net profit in 131.19 million baht, while in same period of previous

year the Company gained 103.73 million baht or would be in equivalence with 26.47 percent of increase,

due to the increase of turnover with circulation of services of the Company was declined and lowered than

that in same period of previous year.

And in 2012, the Company gained net profit in 165.87 million baht, while in same period of previous

year the Company gained 131.19 million baht or would be in equivalence with 26.43 percent of increase,

due to the increase of turnover with circulation of services of the Company was declined and lowered than

that in same period of previous year.

For the matter of assets of the Company, as per the date of 31st December 2010, the Company

shall acquire asset in total 591.75 million baht. This amount consisted of cash and items in equivalence

with cash in 129.45 million baht; short - term investment capital in 30.46 million baht; account receivable in

62.53 million baht; and inventory in 293.90 million baht. The critical change, comparing with assets of the

Company, as per the date of 31st December 2009, was decrease of cash and items in equivalence with cash

in 30.79 million baht to be 129.45 million baht, due to the Company undertook a policy for deposit of 30.46

million baht with any fixed scheme longer than 3 months with gain of higher interest, while the quantity of

inventory with retain of liquidity for the Company was increased from 225.58 million baht, as per the end of

previous period, to be 293.90 million baht, due to the increase of branches from 73 units in 2009 to be 78

units in 2010, while the Company concurrently applied a policy on increase of inventory in each branch for

accelerating of incomes in 2010.


In the matter of overall debt of the Company, as of 31st December 2010, it valued 218.86 million

baht, comprising main components as: creditor for trade and notes payable in 138.12 million baht and values

of shares in 372.89 million baht as, paid registration fee in 171.12 million baht, exceeding of share value in

92.27 million baht and accumulated profits with non-allocation in 94.96 million baht. The critical change was

increase of creditors for trade in 47.29 million baht, as per the date of ending of previous period as 138.12

million baht, due to the Company had procured raw material at the end of year for production of new goods

and sales in 2011 and for accommodation of new branches and short-term loans from financial institutes.

This all was increased 10.32 million baht from payment of debt of the Company.

In the gist of assets of the Company, as of 31st December 2012, the Company acquired assets

in total 746.57 million baht. This amount consisted of cash and items in equivalence with cash in 29.93

million baht; short-term investment capital in 98.11 million baht; account receivablein 76.75 million baht; and

inventory in 479.42 million baht. The critical change was decrease of cash and items in equivalence with

cash in 45.85 million baht, as of 31st December 2011, to be 75.88 million baht, due to the Company invested

amount of cash and items in equivalence with cash for increase of inventory, while the quantity of inventory

with retain of liquidity for the Company was increased from 384.72 million baht, as per the endof previous

period, to be 479.42 million baht, as of 31st December 2012, due to the increase of branches from 79 units

in 2011 to be 96 units in 2012, while the Company concurrently applied a policy on extension of service

coverage with development of new displays and counters in existing branches of the Company.

In the matter of overall debt of the Company, as of 31st December 2012, it valued 247.31 million

baht, comprising main components as: creditor for trade and notes payable in 171.06 million baht and values

of shares in 499.26 million baht as, paid registration fee in 173.30 million baht, exceeding of share value in

92.27 million baht and accumulated profits with non-allocation in 216.19 million baht. The critical change was

increase of creditors for trade in 17.75 million baht, as per the date of ending of previous period, as 153.31

million baht, due to the Company had procured more raw material at the end of year than the last year.

12.2.2 RESULTS OF OPERATION

INCOME

In 2010, 2011 and 2012, the turnovers with circulation of services of the Company were 689.12

million baht; 887.32 million baht; and 1,226.23 million baht, respectively. The gains shall be classified upon

types of products as follows:


1. Diamond jewelry; 614.03 89.10 793.19 89.39 1,089.34 88.84

2. Carat diamond; 69.66 10.11 88.36 9.96 131.05 10.69

3. Service Fee; 5.43 0.79 5.77 0.65 5.84 0.47

Income in Total 689.12 100.00 887.32 100.00 1,226.23 100.00

2010 2011 2012

Type of Income from Sales/Services Quantity Proportion Quantity Proportion Quantity Proportion

Million Baht Percent Million Baht Percent Million Baht Percent

In 2010, the turnover was 689.12 million baht. The proportion of diamond jewelry, comparing with the

same period of previous year, was increased in 28.09 percent, due to the Company launched new products

responding to demands of clients and the turnover of carat diamond was increased, comparing with the

same period of previous year, in 99.60 percent, due to in 2010, the domestic consumption and demands of

clients were increased. The Company had supplied carat diamond for sales in high quantity responding the

demands of clients.

In 2011, the turnover was 887.32 million baht. The proportion of diamond jewelry, comparing with the





demands of clients.

In 2012, the turnover was 1,226.23 million baht. The proportion of diamond jewelry, comparing with the





demands of clients.



In additional, the ratio of incomes from sales of the Company in Bangkok and provinces was drastically

changed with implication, because of the increase of business operation in provinces. The values and ratio

of incomes gained from sales of the Company during 2010 to 2012 shall be presented in detail as follows:

In reference to the above figures, in 2010, incomes from sales in Bangkok and provinces would be

49.61 and 50.39 percent of total income respectively, thus the sales portion in provinces and in Bangkok was

slightly different.In 2011, incomes from sales in Bangkok and provinces would be 57.28 and 42.72 percent

of total income from sales respectively, this portion was drastically changed for the previous year, thus this

portion was changed from the previous year due to the growth of turnovers in Bangkok was higher than in

provinces since the Company had improved image of counters and customer services and also expanded

service coverage in Bangkok rather than in provinces. But in 2012, the portion of sales in Bangkok and

provinces would be 58.41 and 41.51 percent of incomes from sales, therefore the portion had been shaped

in same direction with 2011 due to the growth of turnovers in Bangkok was higher than in provinces.

Other portions of incomes in 2010-2012 comprise service fees for setting and cleaning, profit from

exchange rate and income from personnel administration that was money collected from business enter-

Channel for Distribution

2010 2011 2012

Quantity Percent Quantity Percent Quantity Percent

Bangkok; 339.18 49.61 504.93 57.28 713.78 58.49

Other provinces; 344.51 50.39 376.62 42.72 506.61 41.51

Grand total; 683.69 100.00 881.55 100.00 1,220.39 100.00

Note: This figure does not include incomes from services and other incomes.

Channel for Distribution

2010 2011 2012

Quantity Percent Growth Quantity Percent Growth Quantity Percent Growth


1) Branch or subsidiary of

the Company:

1.1 Shop; 55.95 8.18 -9.61% 76.01 8.62 35.85% 94.78 7.77 24.69%

1.2 Distribution through

department store; 420.46 61.50 34.59% 568.25 64.46 35.15% 779.37 63.84 37.15%

2) Business enterprise making

a contract with the Company;

3) Cooperation with a credit

card or leasing company; 40.75 5.96 78.26% 32.56 3.69 -20.10% 54.13 4.44 52.22%

4) Exhibition of sales; 70.37 10.29 45.48% 122.01 13.84 73.38% 218.26 17.88 78.89%

Income in Total 683.69 100.00 25.64% 881.55 100.00 28.94% 1220.4 100.00 37.97%

Note: This figure does not include incomes from services and other incomes.

The gains shall be classified upon channel of distribution as follows:



Type of Income 2010 2011 2012

Profit from exchange rate; 2.93 - 1.98

Incomes from personnel administration; 0.35 0.34 0.53

Incomes from received interest; 1.10 2.96 1.86

Revival of suspicious non-performanceloan; 0- - -

Revival of lost from devaluation; 0- - -

Revival of lost from depreciation; 0- - -

Others; 0- - 0.32

Other incomes in total; 4.38 3.30 4.69

prises in terms of franchise services without additional profit for payment of salaries to salesmen, rental and

insurance premiums where the Company had paid in advance. Moreover, they also included change of items

of lost from devaluation and of items with suspicion on non performance loan. The type of income within

2010-2012 shall be presented as follows:

In 2010, the Company acquired other incomes in 4.38 million baht, comprising profit from exchange

rate in 2.93 million baht which was increased from the same period of previous year, in 2.23 million baht or

around 38.57 percent; income from personnel administration in 0.35 million baht which was increased from

the same period of previous year, in 0.69 million baht or around 34.62 percent; and income from received

interest in 1.10 million baht which was increased from the same period of previous year, in 0.72 million baht

or around 89.47 percent.

In 2011, the Company acquired other incomes in 3.30 million baht, comprising income from person-

nel administration in 0.34 million baht which was decreased from the same period of previous year, in 0.01

million baht; and income from received interest in 2.96 million baht which was increased from the same

period of previous year, in 1.86 million baht or around 62.84 percent.

In 2012, the Company acquired other incomes in 4.69 million baht, comprising profit from person-

nel administration in 0.53 million baht which was increased from the same period of previous year, in 0.19

million baht; income from received interest in 1.86 million baht which was decreased from the same period

of previous year, in 1.10 million baht; and profit from increasing exchange rate in 1.98 million baht, thus

the other incomes were increased 1.39 million baht or around 42.12 percent of those in the same period of

previous year.

MARKETING AND SERVICE COSTS AND REFINING MARGINS

The Company bore capitals for sales and services in amounts of 379.71; 497.67 and 716.02 million baht

in 2010, 2011 and 2012 respectively. In 2010, the Company increasingly bore capitals for sales and services

in amount of 55.67 million baht, comparing with the same period of previous year. That change of capitals

for sales and services of the Company was in line with increase and decrease of turnover with provision of

services and also reflected to the management on capitals of sales and services with minimal portion lower

than growth rate of turnover in 2009. In 2011, the capital for sales was increased to be 117.96 million baht,

in equivalence with 31.07 percent,comparing with the same period of previous year, due to its incomes and

service fees were increased to be 198.20 million baht, in equivalence with 28.76 percent. And in 2012, the


capital for sales was increased to be 218.35 million baht, in equivalence with 48.87 percent,comparing with

the same period of previous year, due to its incomes and service fees were increased to be 338.86 million

baht, in equivalence with 38.19 percent.

And pertaining to two main goods and products of the Company as: 1) ornaments and decora-

tions; and 2) diamond in karat, in general the ornaments and decorations of the Company shall earn refining

margins higher than gains from diamond in karat. Some forms of ornaments and decorations would earn

refining margins in difference with other forms of ornaments and decorations. In 2010, 2011 and 2012, the

Company earned refining margins in total, 44.90 percent, 43.91 percent and 41.61 percent, respectively. And

comparatively refining margins gained in 2010 and in 2011, they were gradually reduced with slight change

of proportion of sales of diamond ornaments and decorations and of diamond in karat, and the same in 2011

and in 2012, the Company earned lessening refining margins, lower than those gained in previous years,

due to increase of incomes and service fees from settings of exhibitions and sales promotion activities with

more campaigns on discount, while the portion of diamond in karat was also increased.

COSTS OF SALES AND ADMINISTRATION

Costs of sales and administration hereby comprise two main components as: ones with direct

variation to the increase of turnovers and service coverage, as if, additional compensations for salesmen in

forms of commission fees, costs for advertisement and public relations and credit card fees; and ones with

independent variation to the increase of turnovers and service coverage, as if, expenses for transportation

responding to increase of maket price of fuel in the world.

In 2010, the Company bore costs of sales and administration with compensation for executive staff

members in 183.15 million baht, that comparatively with the same period of previous year; this was increased

in 33.21 percent. The ratio of costs on sales and administration with compensation for executive staff mem-

bers, comparing with turnovers and service coverage was 26.58 percent which was higher than one with

the same period of previous year, as in 25.07 percent, because the turnovers and services in 2010 were

increased, while some expenses on sales and administration with compensations for administrators were

not directly variable with turnovers, particularly salaries and bonuses for employees and rental. Therefore,

the proportion of costs of sales and administration with compensation for executive staff memberscompar-

ing with turnovers and services were highly increased, nonetheless the Company also issued a policy with

control of expenses of sales and administration with compensation for executive staff members, while the

annual budgeting plan with assignment of focal points for controlling and inspecting on monthly basis.



in 43.01 percent. The ratio of costs on sales and administration with compensation for executive staff members,

comparing with turnovers and service coverage was 25.48 percent which was lower than one with the same

period of previous year, as in 26.57 percent, because the turnovers and services in 2011 were increased, while

some expenses on sales and administration with compensations for administrators were not directly variable with

turnovers, particularly salaries and bonuses for employees and rental. Therefore, the proportion of costs of sales and

administration with compensation for executive staff members comparing with turnovers and services were highly


PROFITS FROM OPERATION AND NET PROFIT

In 2010, the Company gained profits from operation in amount of 130.65 million baht or with increase

from the same period of previous year, in 48.07 percent. This was caused from increase of turnovers with

services and refining margins, comparing with the same period in previous year.

The net profit of the Company was 103.73 million baht or increase as 72.18 percent comparing with the

same period in previous year and this was caused from increase of turnovers with services and refining margins,

with decrease of corporate income tax. Therefore the net profit was increased around 43.49 million baht.

In 2009 and 2010, the Company acquired net profits in rates of 10.99 and 15.05 percent respectively.

The increase of net profit rate was caused from increase of turnovers with services and refining margins, with

decrease of corporate income tax.



services and refining margins, comparing with the same period in previous year.

The net profit of the Company was 131.18 million baht or increase as 26.47 percent comparing with

the same period in previous year and this was caused from increase of turnovers with services.




services, comparing with the same period in previous year.

The all-inclusive profit of the Company was 165.87 million baht or with increase from the same period

of previous year, in 26.43 percent. This was caused from increase of turnovers with services, comparing with the

same period in previous year. The Company gained net profit with increasing amount of 37.68 million baht.


increased, nonetheless the Company also issued a policy with control of expenses of sales and administration with

compensation for executive staff members, while the annual budgeting plan with assignment of focal points for

controlling and inspecting on monthly basis.



in 35.08 percent. The ratio of costs on sales and administration with compensation for executive staff members,

comparing with turnovers and service coverage was 24.91 percent which was lower than one with the same

period of previous year, as in 25.48 percent, because the turnovers and services in 2012 were increased, while

some expenses on sales and administration with compensations for administrators were not directly variable

with turnovers, particularly salaries and bonuses for employees and rental. Therefore, the proportion of costs of

sales and administration with compensation for executive staff members comparing with turnovers and services

were highly increased, nonetheless the Company also issued a policy with control of expenses of sales and

administration with compensation for executive staff members, while the annual budgeting plan with assignment

of focal points for controlling and inspecting on monthly basis.


12.2.3 BUDGET WITH PRESENTATION OF FINANCIAL STATUS

ASSETS

On the date of 31st December 2010, the current assets of the Companywere comprising main com-

ponents as, cash or item in equivalence with cash in 129.45 million baht, or around 21.88 percent of asset in

total; short-term investment fund in 30.46 million baht, or around 5.15 percent of asset in total; net account

receivable in 62.33 million baht, or around 10.57 percent of asset in total; and net inventory in 293.90 million

baht, or around 49.67 percent of asset in total. The current asset with substantive change was cash or item

in equivalence with cash in 30.79 million baht, since the Company drained 30.46 million baht for short-term

investment with high return. The quantity of inventory was increased 68.32 million baht due to the Company

undertook policies on investment for and retain of inventory in branches of the Company and of course also

increased turnovers with services while there was investment for five new branches in 2010.

On the date of 31st December 2010, main current assets would be enlisted as: net equipment in 15.20

million bahtor around 2.57 percent of asset in total; and deposit at financial institutes with warranty in 37.50

million baht or around 6.34 percent of asset in total. The amount of deposit at financial institutes with warranty

was increased in 24.72 million baht, due to the Company used for warranty short-term loan of the Company.

On the date of 31st December 2011, the current assets of the Company were comprising main com-

ponents as, cash or item in equivalence with cash in 75.79 million baht, or around 11.71 percent of asset in

total; short-term investment fund in 60.26 million baht, or around 9.31 percent of asset in total; net account


baht, or around 59.44 percent of asset in total. The current asset with substantive change was cash or item




increased turnovers with services while there was investment for nine new branches in 2011.

On the date of 31st December 2011, main current assets would be enlisted as: net equipment in

24.80 million bahtor around 3.83 percent of asset in total; and deposit at financial institutes with warranty in

25.0 million baht, or around 3.86 percent of asset in total. The amount of deposit at financial institutes with

warranty was decreased in 12.5 million baht, due to the Company had terminated and closed account of

loan from previous financial institutions with redemption of warranty for deposit in 12.5 million baht.

On the date of 31st December 2012, the current assets of the Company were comprising main com-

ponents as, cash or item in equivalence with cash in 29.93 million baht or around 4.01 percent of asset in

total; short-term investment fund in 98.11 million baht or around 13.14 percent of asset in total; net account


baht or around 64.22 percent of asset in total. The current asset with substantive change was cash or item




increased turnovers with services while there was investment for seventeen new branches in 2012.


On the date of 31st December 2012, main current assets would be enlisted as: net equipment in

34.48 million baht,or around 4.61 percent of asset in total; intangible asset in 2.55 million baht, or around 0.34

percent of asset in total; and non-current asset in 14.61 million or around 1.96 percent of asset in total.

Remaining Period of Time 31stDEC 2010 Percent 31

stDEC 2011 Percent 31

stDEC 2012 Percent

QUALITY OF ASSETS

(a) Account receivable and notes receivable and allowance for doubtful accounts:

The account receivable and notes receivable shall be classified upon due of debt payment as follows:

Within due of payment; 60.70 95.49 52.86 97.40 75.82 97.38

Not exceeding 3 months; 1.83 2.88 0.30 0.55 0.92 1.18

Over 3 month-due, till 6 months; 0.00 0.00 0.09 0.17 0.01 0.01

Over 6 month-due, till 9 months; 0.00 0.00 0.00 0.00 0.00 0.00

Overdue for 12 months upwards; 1.04 1.63 1.02 1.88 1.11 1.43

Total; 63.57 100.00 54.27 100.00 77.86 100.00

Deduction for suspicious

non-performanceloan; (1.04) (1.64) (1.05) (1.93) (1.11) (1.43)

Total-Net 62.53 98.36 53.22 98.07 76.75 98.57


The accounts receivable of the Company comprises debtors as department stores holding debts

from sales of products through mega department stores where regularly do clearance of debts within 45 to

60 days. Most of accounts receivable in this type shall be able to pay on due and some of them would be

clients making contracts likewise franchise of the Company with orders of products for the Company for

distribution. The Company undertakes policies for providing credit to these accounts receivable within 45

to 60 days, while the Company allows them to pay for such goods and products with delay. This causes

pending number of accounts receivable, anyhow the Company shall be able to collect money from clients

on due. And for the direct sales to end users or consumers, there is none of credit scheme or payment by

monthly installments.

In additional, the Company has issued policies remedial for uncollectible accounts, the reserved

fund would be installed when any account receivable has overdue debt, longer than 180 days, or underthe

prediction with reference to record of debt payment in the past or any information given to executive entity.

The allocation of reserved fund would respond to number of debtors with uncollectible accounts. On the

dates of 31st December 2010, of 31

st December 2011 and of 31

st December 2012, the Company had install

remedial for uncollectible accounts in 10.4, 1.05, 1.11 million baht respectively. The installment of remedial

for uncollectible accounts was commissioned in accordance with policies remedial for uncollectible accounts

in all periods and the Company had retain this reserved fund covering to all risks and problems.


On the dates of 31st December 2010, of 31

st December 2011 and of 31

st December 2012, the Com-

pany held inventories in amounts of 293.89, 384.72 and 479.92 million baht respectively, the inventories with

the most severe change were readymade products, Diamond jewelry and Carat Diamond.

On the date of 31st December 2010, the amount of inventory of the Company was increased from

225.58 million baht to 298.89 million baht at the end of period in previous year; this would be calculated

as an increasing amount in 68.31 million baht or 30.28 percent. The most changing sector, in 2010, was

readymade products and jewelry which increasing branches from 73 units to be 78 units.


293.89 million baht to 384.72 million baht at the end of period in previous year; this would be calculated

as an increasing amount in 90.83 million baht or 30.91 percent. The most changing sectors, in 2011, were

readymade products andornaments, with increasing amount in 88.73 million baht, carat diamond-readymade

product, with increasing amount in 3.30 million baht. These amounts shall be caused from the increase of

branches from 78 units to be 79 units.


384.72 million baht to 479.42 million baht at the end of period in previous year; this would be calculated as

an increasing amount in 94.70 million baht or 24.62 percent for the same period in previous year. The most

changing sectors, in 2012, were readymade products and jewelry, with increasing amount in 106.02 million

baht, carat diamond-readymade product, with decreasing amount in 25.33 million baht. These amounts shall

be caused from the increase of branches from 79 units to be 96 units.

ITEMS 31st DEC 2010 Percent 31

st DEC 2011 Percent 31

st DEC 2012 Percent

(b) Inventory:


Diamond jewelry; 207.51 70.61 296.24 77.00 402.26 83.91

Carat Diamond-ready-to-use

products; 39.91 13.58 43.21 11.23 17.88 3.73

Pending work; 13.44 4.57 1.49 0.39 13.31 2.78

Plain setting; 2.07 0.70 2.83 0.73 5.11 1.07

Gold; 0.03 0.01 0.37 0.10 0.49 0.10

Diamond-raw material; 28.88 9.83 37.57 9.77 34.41 7.18

Consumable material; 2.05 0.70 3.01 0.78 5.96 1.24

Total-Net 293.89 100.00 384.72 100.00 479.42 100.00

Net profit; 103.73 131.19 165.87

Adjustment of items with impact to net profit; 31.81 46.08 58.77

Profit from operation before change in assets

and debts from operation;

Change in assets; (100.35) (66.67) (125.41)

Change in debts; 64.23 (7.46) 30.14

Payment of interest; (0.74) - -

Payment of income tax; (28.25) (32.66) (37.15)

Cash flow from operations; 70.43 70.48 92.22

Cash flow from investment; (36.31) (43.21) (28.20)

Cash flow from fund-raising activities; (64.54) (80.93) (109.88)

Increase (decrease) of cash flow and items in equivalent; (30.41) (53.66) (45.86)

Net

Cash flow and items in equivalent, on the date of

beginning; 160.24 129.45 75.79

Cash flow and items in equivalent, on the date

of ending; 129.45 75.79 29.93


For the gist of policies on inventory management, in category of diamond jewelry and decorations, the

Company would collect information and quantity of products on basis of forms and formats for classification

and tracking of products with slow pace. If any is identified with slow pace, the Company shall move such

products to other branches for increase of possibility with choice of sales. And at the end, if any form of

product does not match with demands and is left in stock without value-adding, the Company shall set up

an event with promotion for sales, likewise the increase of discount portion with reduce of profit and finally

if such product shall not be sold, the Company shall dictate a policy with exploitation of such product, e.g.

to reformat the form of them with new style of product. And for those readymade products in form of carat

diamond or raw materials, they would not be managed on basis of time and out of date, but on basis of

principal with global market price with estimation of depreciation of product.

In reference to above figures, the Company gains profits in continuity in every year, but the cash

flow gained from operation of the Company is sporadically reduced. The turnovers with service coverage are

increased in every year and of course shall be cause of increase of current capital for procuring and pur-

chasing of raw material and retain of inventory for allowing clients to be able to freely choose. The Company

acquires such working capital from accounts payable that receiving credit allowance within 90-180 days

and shall be a part of benefits from operation of the Company. And from the operation of business of the

Company with extension of service coverage, it caused reduce of cash flow with deficiency and spending

of cash for procuring and purchasing of products. The Company had taken a loan from commercial banks

ITEMS 31st DEC 2010 31

st DEC 2011 31

st DEC 2012



in short-term loan whenever it really needed cash with liquidity. Currently, the Company has a bank

loan from commercial bank with adequacy for running of business, so there is none of problem with liquidity.

Its liquidity proportions with substances shall be presented as follows:

In 2010, the Company held liquidity proportion in 2.53 folds with slight reduction from 3.08 folds in

2009. The average time for collecting of debt would be 33 days which was slightly different from 35 days in

2009. The duration of distribution for product would be 247 days in average, while the duration for clearance

of debt in average would be 108 days, which was increased from 101 days in 2009.

In 2011, the Company held liquidity proportion in 2.89 folds with increase from 2.58 folds in 2010.

The average time for collecting of debt would be 24 days which was different from 33 days in 2010. The

duration of distribution for product would be 245 days in average, while the duration for clearance of debt

in average would be 117 days, which was increased from 108 days in 2010.

In 2012, the Company held liquidity proportion in 2.92 folds with increase from 2.89 folds in 2011.

The average time for collecting of debt would be 19 days which was different from 24 days in 2011. The

duration of distribution for product would be 217 days in average that reduce, which lessening than 245

days in 2011, while the duration for clearance of debt in average would be 82 days, which was increased

from 117 days in 2010.

EFFICIENCY OF OPERATION

The Company does not have a manufacturing factory for its products, while also rents areas for

distribution of products rather than purchasing plots of lands, therefore it holds very limit of permanent

assets. For this matter, the ratio of returns from permanent assets shall not be used to evaluate effectiveness

on usage of assets of the Company, in contradiction it shall be used as reflection of efficiency.

In 2010, the ratio of returns from permanent assets was 19.18 percent because the Company gained

higher profits from business, while in 2011, the ratio of returns from permanent assets was increased from

19.18 to 21.18 percent and in 2012, the ratio of returns from permanent assets was increased from 21.18 to

23.80 percentbecause the Company gained higher profits from business.

SOURCE OF CAPITAL

DEBTS

On 31st December 2010, the Company bore amount of loan in 105 million baht from financial insti-

tutes, as: a 3-year loan from trust receipt and promissory notes on 1-6 months from commercial banks with

different rates of interests, in 5.8-6.50 percent per year. On 28th December 2010, the Company shall pay all

amount of debt to such financial institutes, while shall make a new loan from them, with installment of 25

million baht fixed-account, as a warranty for loan, to such new financial institutes.


On 31st December 2011, the Company bore amount of loan in 115 million baht from financial institutes,

as: a 3-year loan from trust receipt and promissory notes on 1-6 months from commercial banks with differ-

ent rates of interests, in 6.50-7.50 percent per year. The Company installed a 25 million baht fixed-account

as a warranty for loan to financial institutes.

On 31st December 2012, the Company bore amount of loan in 115 million baht from financial in-

stitutes, as: a 3-year loan from trust receipt and promissory notes on 1-6 months from commercial banks

with different rates of interests, in 6.50-7.50 percent per year, and without installment of fixed-account as a

warranty for loan.

PORTION OF SHARES

On 31st December 2010, the portion of shares of the Company, owning by shareholders, was 372.89

million baht, while there was an accumulated profit with non-allocation in 94.96 million baht. And in the An-

nual General Meeting of Shareholders in 2010, the meeting adopted a resolution with approval for payment

of dividend from profit of operation in 2009 in 0.21 baht per share and in the meeting of the Company,

no.3/2553, the meeting adopted a resolution with approval for payment of dividend from profit of operation

during January-June 2010 in 0.15 baht per share.


million baht, while there was an accumulated profit with non-allocation in 151.98 million baht. And in the

Annual General Meeting of Shareholders in 2011, the meeting adopted a resolution with approval for pay-

ment of dividend from profit of operation in 2010 in 0.20 baht per share and in the meeting of the Company,




million baht, while there was an accumulated profit with non-allocation in 216.19 million baht. And in the

Annual General Meeting of Shareholders in 2012, the meeting adopted a resolution with approval for pay-

ment of dividend from profit of operation in 2011 in 0.29 baht per share and in the meeting of the Company,




FACTORS AND INFLUENCES TOWARDS OPERATION OR FINANCIAL STATUS

IN THE FUTURE

The factors and influences that might create impact to operation or financial status in the future,

apart from those mentioned in risk factors, shall be enlisted as follows:

1. CHANGE OF FINACIAL PROPORTION DUE TO INCREASING CAPITAL FROM INCREASE

OF STOCK CAPITAL

On 31st December 2010, the Company held paid-up registered capital in amount of 171,121,500

baht with given value, as 1 baht per share, in 175,000,000 ordinary shares and gained net profit in 2010 in

amount of 103.73 million baht, with net profit rate per volume weighted average in 0.61 baht per share, and

value in account in 2.18 baht per share, as per calculation from quantity of ordinary shares of the Company,

on 31st December 2010.











In additional, if there isa purchasing of ordinary shares of the Company, as per the certificate of

entitlement issued to members of the Board of Directors and employees of the Company (with identifica-

tion of bearer and non-negotiable) in total 5,000,000 units, the Company held paid-up capital in amount of

175,000,000 baht with given value, as 1 baht per share, in 175,000,000 ordinary shares and shall gain lower

profit per share in the future. The net profit per share, in 2009, was reduced from a purchasing of ordinary

shares of the Company, as per all certificates of entitlement (Fully Diluted) in 0.02 baht per share. Such

increase of ordinary shares of the Company shall create more value of share under account, in 2.25 baht

per share, as per calculation from an account of the Company, on 31st December 2009. Butwithin 5,000,000

capital increase ordinary shares with responding to exercise of conversion right upon such certificate of


entitlement shall not be exceeding 25 percent per year of such capital increase ordinary shares of each

individual holding allocation, therefore the reduction of net profit rate per share would not be immediately

occurred.

Anyhow after the proposal for sales of capital increase ordinary shares and exercise of right to pur-

chase ordinary shares of the Company, as per the certificate of entitlement issued to members of the Board

of Directors and employees of the Company, the Company shall acquire more current fund with decrease of

interest burden of the Company. In additional, the turnover of the Company, with the projection on growth

of industry and tactics for increase of service coverage through branches of the Company, shall cause in-

crease of net profit of the Company that shall help to reduce impacts towards reduction of profit per share

and value of share under account increased from quantity of shares.

COMPENSATION FOR CHARTERED ACCOUNTANT

According to the Resolution adopted in the Annual General Meeting of Shareholders in 2012, the

Company had agreed to pay compensation for account auditing, to Mr. Prawit Viwanthananut, a chartered

accountant with license number 4917 of the ANS Auditing Office, in charge of auditor for account in year

round 2012, in amount of 585,000 baht.

OTHER SERVICE FEES

None of them.


THE BOARD OF DIRECTORS’ RESPONSIBILITIES IN RESPECT OF

THE FINANCIAL STATEMENT TO SHAREHOLDERS

The Board of Directors of the Company is an entity holding responsibilities on financial reports of

the Jubilee Enterprise Public Company Limited that were made under standards of financial statements un-

der the Act on Accounting, B.E. 2543 (2000) and under the Securities and Stock Exchange Commission on

Documentation and Presentation on Financial Statements under the Act on Securities and Stock Exchange,

B.E. 2535 (1992) to disclose necessary information with adequacy in the Footnotes to Financial Statements,

audited by an auditor in reports of auditor for benefits of shareholders and all investors in general with

transparency.

The Board of Directors of the Company shall hold duties on supervision and development of gover-

nance, including on provision and maintain of risk management system and internal controlling. The Board

of Directors of the Company had appointed the Auditing Committee, comprising independent members

with duties on supervision of financing, evaluation of internal controlling system and internal audit with

efficiency and effectiveness. The discretions and opinions of the Audit Committee shall be recorded and

published in its report which shall be affixed with this Annual Report.

The Board of Directors of the Company opines that from the aforementioned operations, they

create reliability with trustfulness on financial budget of the Jubilee Enterprise Public Company Limited with

presentation of financial status, results of performance and cash flow on annual basis until the date of 31st

December 2012, in accuracy upon substantive matters.

(Mr. Manu Leopairote)

Chairman of the Board of

Directors of the Company

(Mr. Viroj Phonprakit)



REPORT OF THE AUDIT COMMITTEE

Dear Shareholders,

Audit Committee of the Jubilee Enterprise Public Company Limited is appointed by the Board of

Directors of the Company, consisting of three independent knowledgeable persons holding qualifications

under the Notification of Securities and Stock Exchange Commission, serving in different capacities as:

Mr. Amnuay Nakarachata-amorn, as the Chair of Audit; Mr. Pirote Maleehorm, as a member;

Miss Zonwa Denmeka, as a member; and Mr. Warawuth Sethanarak, as a secretary to the Audit.

Audit Committee has fulfilled its duties and responsibilities in accordance with its assignments and in

compliance with the Notification of Securities and Stock Exchange Commission. Within the accounting year

round in 2012, there were four meetings of the Audit with full attendance and presentation of all members,

while there were number of meetings with executive staff members, chartered accountants and internal

auditors, as follows:

1. The review on budget presenting financial status with profit and lost on quarterly basis and

financial statements on the year of 2012 had been set up with a series of meetings for inquiry

and hearing of clarification and explanation from chartered accountants and executive staff

members, on accuracy and completion of financial statements and adequacy of information

disclosure, including the receipt of observations and recommendations of chartered accoun-

tants in 2012, Audit Committee hereby gave opinions in line with chartered accountants that

such financial statements are accurate and in compliance with financial statement standards

in general.

2. The review on internal auditing for evaluating of appropriateness and efficiency of internal

auditing system had been conducted for enhancement the operation with achievement of

designated goals. The internal auditing report in 2012, under an approved plan, had been

considered particularly with covering of significant working systems of the Company and there

is none of weakness point or shortcoming in any substantive matter.

3. The review and examination of internal auditing system for evaluation of efficiency of internal

auditing unit had been conducted with consideration on scope of operations, duties and

responsibilities with independency, manpower and budget of internal auditing unit, including the

discretion on modernization and compatibility of charter and internal audit with current situation

and in compliance with the guidebook on internal audit of the Stock Exchange of Thailand. Audit

Committee hereby opined that the Company owns the internal auditing system with adequacy,

appropriateness and efficiency, in compliance with international standards.

4. The review on operations of laws on securities and stock exchange, regulations of the Stock

Exchange of Thailand and relevant laws on business of the Company had been conducted,

including operations under regulations of the Company and legal bindings of the Company

with any external person.


5. The review and giving of opinions to list of interactions or items with conflict of interest, including

disclosure of such information, had been conducted in compliance with regulations of the

Stock Exchange of Thailand and of Office of the Securities and Stock Exchange. Audit had

considered and gave opinions in line with those from auditors and opined that all substantive

contents with presentation of financial statement and footnotes to financial statement were

accurate and complete.

6 The consideration, recruitment and selection for an auditor with proposal on compensation had

been designed and proposed to the Board of Directors of the Company for asking an approval

from the Annual General Meeting of shareholders, while the Auditing Committee considered

results of operation, independency and appropriateness on compensation and proposed that

the ANS Audit Co., Ltd. shall be appointed with entrustment of Mr. Prawit Viwanthananut,

a Certified Public Accountants with license number 4917; or Mr. Athipong Atipongsakul, a Certified

Public Accountants with license number 3500; or Mr. Bunjong Pichayaprasat, a Certified Public

Accountants with license number 7147; or Mr. Thoetthong Thepmangkorn, a Certified Public

Accountants with license number 3787 to be an auditor of the Company in 2013, with

comments on appointment of auditors as follows:

- An auditor with independency and without any relation with the Company or any affiliating

subsidiary company;

- In the past accounting year round, a designated auditor had perform his task with knowl

edge, competency in profession and gave recommendations on internal controlling system

and risks with independency of operations;

CONCLUDING OBSERVATIONS OF THE AUDIT COMMITTEE

In the year 2012, the Audit Committee had fully acted its duties and responsibilities responding to its

assignments with competency and independency. The Committee opined that the Company had documented

a report on financial status and operation with accuracy, while there is internal controlling system with internal

audit in appropriateness and efficiency. The Committee also acted in compliance with supervising system on

good governance with adequacy, transparency and reliability, covering the development and improvement

of operation with high quality and appropriateness of contexts of business in continuity.

(Amnuay Nakruchata-amorn)

Chairman of Audit Committee

AUDITOR’S REPORT

To the Board of Directors and Shareholders of Jubilee Enterprise Public Company Limited

I have audited the accompanying the financial statements of Jubilee Enterprise Public Company Limited

which comprise the statement of financial position as at December 31, 2012, and the statement of comprehensive

income, statement of changes in shareholders’ equity and statement of cash flows for the year then ended, and

a summary of significant accounting policies and other explanatory information.

Management’s Responsibility for the Financial Statements

Management is responsible for the preparation and fair presentation of these financial statements

in accordance with Thai Financial Reporting Standards, and for such internal control as management

determines is necessary to enable the preparation of financial statements that are free from material

misstatement, whether due to fraud or error.

Auditor’s Responsibility

My responsibility is to express an opinion on these financial statements based on my audit. I conducted

my audit in accordance with Thai Standards on Auditing. Those standards require that I comply with ethical

requirements and plan and perform the audit to obtain reasonable assurance about whether the financial

statements are free from material misstatement.

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

the financial statements. The procedures selected depend on the auditor’s judgment, including the assessment

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

risk assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentation

of the financial statements in order to design audit procedures that are appropriate in the circumstances, but

not for the purpose of expressing an opinion on the effectiveness of the 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 financial statements.

I believe that the audit evidence I have obtained is sufficient and appropriate to provide a basis for my

audit opinion.

Opinion

In my opinion, the financial statements present fairly, in all material respects, the financial position of

Jubilee Enterprise Public Company Limited as at December 31, 2012, and its financial performance and cash

flows for the year then ended in accordance with Thai Financial Reporting Standards.

Bunjong Pichayaprasat

Certified Public Accountant

Registration Number 7147ANS Audit Co., Ltd.

Bangkok, February 22, 2013

101

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


102

2012 2011Note

Baht

ASSETS 3

JUBILEE ENTERPRISE PUBLIC COMPANY LIMITED

STATEMENTS OF FINANCIAL POSITION

AS AT DECEMBER 31, 2012 AND 2011

Current assets

Cash and cash equivalents 5 29,925,889.86 75,787,030.33

Short-term investments 6 98,110,983.60 60,255,029.04

Trade and other receivables 4, 7 76,750,906.04 54,338,350.50

Inventories 8 479,421,226.79 384,723,551.63

Other current assets 10,822,604.78 8,363,858.69

Total current assets 695,031,611.07 583,467,820.19

Non-current assets

Restricted financial institution deposits 9 - 25,000,000.00

Building and equipment 10 34,382,324.31 24,805,209.55

Intangible assets 11 2,545,496.47 4,438,624.55

Other non-current assets 14,606,007.61 9,566,694.69

Total non-current assets 51,533,828.39 63,810,528.79

Total assets 746,565,439.46 647,278,348.98



103

Current Liabilities

Trade and other payables 4, 13 171,057,658.54 153,305,568.53

Current portion of debts 16 8,664,199.77 7,703,623.97

Accrued income tax 26 22,095,531.21 16,616,014.50

Other current liabilities 36,419,224.50 24,162,316.92

Total current liabilities 238,236,614.02 201,787,523.92

Non-current liabilities

Long-term loans from financial institutions 14 - 6,666,656.00

Liability under finance lease 15 3,723,614.59 1,262,577.02

Employee benefit obligations 17 5,346,722.99 3,528,994.6800

Total non-current liabilities 9,070,337.58 11,458,227.70

Total liabilities 247,306,951.60 213,245,751.62

2012 2011Note

Baht

LIABILITIES AND SHAREHOLDERS’ EQUITY 3






104

SHAREHOLDERS’ EQUITY

Share capital 18, 19

Authorized share capital

175,000,000 ordinary shares, Baht 1 par value 175,000,000.00 175,000,000.00

Issued and paid-up share capital

173,297,625 ordinary shares, in year 2012 and

172,287,750 ordinary shares, in year 2011, Baht 1 per share 173,297,625.00 172,287,750.00

Premium on share capital 21 92,267,172.80 92,267,172.80

Retained earnings 20, 22

Appropriated to legal reserve 17,500,000.00 17,500,000.00

Unappropriated 216,193,690.06 151,977,674.56

Total shareholders’ equity 499,258,487.86 434,032,597.36

Total liabilities and shareholders’ equity 746,565,439.46 647,278,348.98

3





2012 2011Note

Baht

LIABILITIES AND SHAREHOLDERS’ EQUITY


105

Revenue from sales 1,226,230,285.32 887,316,244.47

Cost of sales 23 (716,021,706.79) (497,665,606.65)

Gross profit 510,208,578.53 389,650,637.82

Other income 4,690,668.32 3,300,323.33

Selling expenses 23 (227,580,887.17) (154,624,432.09)

Administrative expenses 23 (77,866,895.15) (71,494,517.80)

Finance costs 24 (952,445.63) (1,298,062.71)

Profit before income tax 208,499,018.90 165,533,948.55

Income tax expense 27 (42,633,230.90) (34,348,117.08)

Profit for the year 165,865,788.00 131,185,831.47

Other comprehensive income -00 -00

Total comprehensive income 165,865,788.00 131,185,831.47

Earnings per share

Basic earnings per share 3 0.96 0.77

Weighted average number of ordinary shares (shares) 3 172,439,507.00 171,290,846.00

Diluted earnings per share 3 0.96 0.75

Weighted average number of ordinary shares (diluted) (shares) 3 173,387,274.00 174,654,291.00

2012 2011Note

Baht

3, 4


STATEMENTS OF COMPREHENSIVE INCOME

FOR THE YEARS ENDED DECEMBER 31, 2012 AND 2011



106



STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY


Beginning balance as at January 1, 2011

Effects of change in accounting policy

Adjusted balance

Changes in shareholders’ equity

Comprehensive income for the year

Dividends

Appropriated - legal reserve

Issue of ordinary shares

Ending balance as at December 31, 2011

Changes in shareholders’ equity

Comprehensive income for the year

Dividends

Issue of ordinary shares

Ending balance as at December 31, 2012

4

20

22

18

20

18

Note

Issued and paid-up

share capital

Premium on

share capital Appropriated Unappropriated Total

Retained earnings

Baht

171,121,500.00

-00

171,121,500.00

00

-00

-00

-00

1,166,250.00

172,287,750.00

-00

-00

1,009,875.00

173,297,625.00

92,267,172.80

-00

92,267,172.80

00

-00

-00

-00

00-00

92,267,172.80

-00

-00

-00

92,267,172.80

14,542,198.47

-00

14,542,198.47

00

-00

-00

2,957,801.53

-00

17,500,000.00

-00

-00

-00

17,500,000.00

94,957,969.15

2,373,920.47

97,331,889.62

131,185,831.47

(73,582,245.00)

(2,957,801.53)

-

151,977,674.56

165,865,788.00

(101,649,772.50)

-00

216,193,690.06

372,888,840.42

2,373,920.47

375,262,760.89

131,185,831.47

(73,582,245.00)

---

1,166,250.00

434,032,597.36

165,865,788.00

(101,649,772.50)

1,009,875.00

499,258,487.86

Annual Report

2012 Jubile

e Ente

rpris

e Public

C

om

pany Lim

ited

165,533,948.55

7,725,238.88

233,936.32

-

-

(1,911,803.24)

3,528,994.68

(2,955,729.98)

1,296,562.71

177,274,754.40

8,627,052.61

(88,454,166.83)

3,465,711.99

12,500,000.00

(2,816,574.61)

(17,687,107.69)00

10,228,348.24

103,138,018.11

(32,658,996.82)

70,479,021.29

208,499,018.90

14,147,527.10

(201,286.89)0

1,612,884.90

(190,247.47)

(129,342.98)

1,817,728.31

(1,863,922.13)

952,445.63

224,644,805.37

(22,635,075.78)

(95,325,223.57)

(2,405,900.84)

-

(5,043,068.79)

17,881,432.99

12,256,907.58

129,373,876.96

(37,153,714.19)

92,220,162.77

9

4,9

57,9

69.1

5

2,3

73,9

20.4

7

97,3

31,8

89.6

2

131,1

85,8

31.4

7

(7

3,5

82,2

45.0

0)

(2

,957,8

01.5

3)

-

151,9

77,6

74.5

6

165,8

65,7

88.0

0

(101,6

49,7

72.5

0)

-00

216,1

93,6

90.0

6

107

2012 2011

Baht


STATEMENTS OF CASH FLOWS


CASH FLOWS FROM OPERATING ACTIVITIES

Net profit before income tax

Adjustments to reconcile net profit before income tax to net cash

provided by (used in) operating activities

Depreciation and amortization

Bad debt and doubtful accounts (reversal)

loss from impairment of assets

Unrealized gain of trading security

Unrealized (gain) loss on exchange rate

Employee benefit liabilities

Interest income

Interest expenses

Profit from operating activities before changes in operating

assets and liabilities

Change in operating assets (increase) decrease

Trade and other receivables

Inventories

Other current assets

Restricted financial institution deposits

Other non-current assets

Change in operating liabilities increase (decrease)

Trade and other payables

Other current liabilities

Cash generated from operation

Income tax paid

Net cash provided by operating activities



108

(12,665,707.09)

(17,496,392.88)

(62,000.00)

2,019,879.88

(28,204,220.09)

(6,666,672.00)0

(1,618,068.02) 0

1,009,875.0000

(952,445.63)

(101,649,772.50)

(109,877,083.15)

(45,861,140.47)

75,787,030.33

29,925,889.86

Supplementary disclosure of cash flows information

For year 2012

1) The Company purchased vehicle and office equipment in the amount of Baht 5.04 million by

entering into a finance lease agreement.

2) The Company transfered restricted financial institution deposits in the amout of Baht 25 million

to short-term investment.

For year 2011

1) The Company recorded effects of changes in accounting policies for the inventory valuation method

with retained earnings as at January 1, 2011 in the amount of Baht 2.37 million.

2) The Company purchased office equipment in the amount of Baht 1.93 million by entering into a

finance lease agreement.

(29,796,703.17)

(14,042,434.20)

(2,224,755.00)

2,849,698.05

(43,214,194.32)

(6,666,672.00)

(558,238.51)

1,166,250.00

(1,296,562.71)

(73,571,222.70)

(80,926,445.92)

(53,661,618.95)

129,448,649.28

75,787,030.33

2012 2011

Baht


STATEMENTS OF CASH FLOWS


CASH FLOWS FROM INVESTING ACTIVITIES

Increase in short-term investments

Purchases of equipment

Purchases of intangible assets

Interest received

Net cash provided by (used in) investing activities

CASH FLOWS FROM FINANCING ACTIVITIES

Repayment for long-term loans from financial institutions

Payment for liability under finance lease

Cash received from increase in ordinary shares

Interest expense

Dividend payment

Net cash used in financing activities

Net decrease in cash and cash equivalents

Cash and cash equivalents at the beginning of the year

Cash and cash equivalents at the end of the year



109


NOTES TO THE FINANCIAL STATEMENTS


1. GENERAL INFORMATION

Jubilee Enterprise Public Company Limited, “the Company” was incorporated in Thailand under

the Civil and Commercial Code on November 3, 1993, registered no. 0105536125477 and becamea public

company limited on July 8, 2008, registered no. 0107551000177, to operate a business as a retail and

wholesale of jewelry.

On October 19, 2009, the Company was listed on the Stock Exchange of Thailand in “Market for

Alternative Investment” (mai).

The head office is located at 721 Silom Road, Silom, Bang Rak, Bangkok.

The major shareholdersare as follows:

Rate of shareholding

Name/Company Nationality/Country percentage

2012 2011

Pornprakit Family Thai 58.96 59.47

K-SME Venture Capital Company Limited Thailand 2.03 2.04

2. BASIS OF PREPARATION OF THE FINANCIAL STATEMENTS

The accompanying financial statements are prepared in accordance with Thai Financial Reporting

Standards (“TFRS”) including related interpretations and guidelines promulgated by the Federation of

Accounting Professions (“FAP”) in conformity with generally accepted accounting principles in Thailand.

The presentation of the financial statements has been made in compliance with the stipulations of the

Notification of the Department of Business Development dated September 28, 2011, issued under the Accounting

Act B.E. 2543.


110

The accompanying financial statements have been prepared in the Thai language and expressed in

Thai Baht. Such financial statements have been prepared for domestic reporting purposes. For the convenience

of the readers not conversant with the Thai language, an English version of the financial statements has been

provided by translating from the Thai version of the financial statements.

The preparation of the financial statements in conformity with Thai Financial Reporting Standards

(“TFRS”) requires management to make judgments, estimates and assumptions that affect the application

of policies and reported amounts of assets, liabilities, income and expenses. The estimates and associated

assumptions are based on historical experience and various other factors that are believed to be reasonable

under the circumstances, the results of which form the basis of making the judgments about carrying amounts

of assets and liabilities that are not readily apparent from other sources. Subsequent actual results may

differ from these estimates.

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting

estimates are recognized in the period in which the estimate is revised, if the revision affects only that period,

and in the period of the revision and future periods, if the revision affects both current and future periods.

The changes in accounting policies as at January 1, 2011

In the year 2011, the Company has adopted new and revised TFRS which such transition affected

the financial statements reflected from TAS No. 19 “Employee Benefits”, which applied a transitional provision

that such liability is recognized and accounted of amortization to expenses within 3 accounting periods

ending December 31, 2013.

New and revised Thai Financial Reporting Standards not yet effective

The Company has not yet adopted the new and revised Thai Financial Reporting Standards as follows:

a) Thai Accounting Standards (TAS), Thai Financial Reporting Standards (TFRS), Thai Interpretation (TI)

and guidelines which are effective for the financial statements for the period beginning on or after

January 1, 2013 as follows:


Topic

111

TAS/TFRS/TI/FAP’s Announcement

TFRI/TI Topic

TAS 12 Income Taxes

TAS 20 (revised 2009) Accounting for Government Grants and Disclosures

of Government Assistance

TAS 21 (revised 2009) The Effects of Changes in Foreign Exchange Rate

TFRS 8 Operating Segments

TI 10 Government Assistance – No Specific Relation to

Operating Activities

TI 21 Income Taxes – Recovery of Revalued Non-Depreciable

Assets

TI 25 Income Taxes – Changes in the Tax Status of an

Enterprise or its Shareholders

No. 34/2555 Accounting Treatment Guidance for Transfers of

Financial Assets

TFRI 4 Determining whether an Arrangement contains a Lease

TFRI 12 Service Concession Arrangements

TFRI 13 Customer Loyalty Programmes

TI 29 Service Concession Arrangements: Disclosures

The management of the Company is assessing the impacts of these standards, interpretations and

FAP’s Annoucement on the financial statements for the year in which they are initially applied

b) Thai Financial Reporting Interpretations (TFRI) and Thai Interpretation (TI) which are effective for

the financial statements for the period beginning on or after January 1, 2014 as follows:

The management of the Company is assessing the impacts of these standards and interpretations

on the financial statements for the year in which they are initially applied.


112

3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The measurement bases used in preparing the financial statements

Other than those disclosed elsewhere in the summary of significant accounting policies and other

notes to the financial statements, the financial statements are prepared on the historical cost basis.

Revenues

Sale of goods and service income

Revenue excludes value added taxes or other sales taxes and is arrived at after deduction of

trade discounts.

Revenue is recognized in the statements of comprehensive income when the significant risks

and rewards of ownership have been transferred to the buyer. No revenue is recognized if there is continu-

ing management involvement with the goods or there are significant uncertainties regarding recovery of the

consideration due, associated costs or the probable return of goods.

Interest income

Interest income is recognized as interest accrues, based on the effective rate method.

Other income

Other income are recognized on an accrual basis.

Expenses

Operating leases

Payments made under operating leases are recognized in the statements of comprehensive income

on a straight-line basis over the term of the lease. Lease incentives received are recognized in the statements

of comprehensive income as an integral part of the total lease payments made. Contingent rentals are charged

to the statements of comprehensive income in the accounting period in which they are incurred.

Finance costs

Interest expenses and similar costs are charged to the statements of comprehensive income in the

period in which they are incurred, except to the extent that they are capitalized as being directly attributable

to the acquisition, construction or production of an asset which necessarily takes a substantial period of time

to be prepared for its intended use or sale. The interest component of finance lease payments is recognized

in the statements of comprehensive income using the effective interest rate method.


113

Other expenses are recognized on an accrual basis.

Employee benefits

Short-term benefits

The Company recognizes salaries, wages, bonus and social security contribution as expenses on

an accrual basis

Post-employment benefits – defined contribution plan

The Company operates a provident fund that is a defined contribution plan. The assets of which

are held in a separate trust fund. The provident fund is funded by payments from employees and the com-

pany. Contributions to the provident fund are charged to the statement of comprehensive income in the

period to which theyrelate.

Post-employment benefits – defined benefit plan

The employee benefits liabilities in relation to the severance payment under the labor law is

recognised as a charge to results of operations over the employee’s service period. It is calculated by the

estimation of the amount of future benefit to be earned by the employee in return for the service provided

to the Company through the service period up to the retirement age and the amount is discounted to

determine the present value. The reference discount rate is the yield rate of government bonds as at the

reporting date. The calculation is based on the actuarial technique using the Projected Unit Credit Method.

When the employee benefits are improved, the portion of the increased benefit relating to past

service rendered by employee is recognized in the statements of comprehensive income on a straight-line

basis over the average period until the benefits become vested.

When the actuarial assumptions are changed, the Company recognizes actuarial gains (losses)

in the profit or loss in the period in which they arise.

Cash and cash equivalents

Cash and cash equivalents are cash on hand, current deposits and savings deposits, cash at bank

with an original maturity of 3 months and short-term investments with high liquidity excluded term deposits

and deposits at bank on obligation.


114

Investments

Short-term investments which are marketable equity securities held for trading are stated at fair

value and recognized changes in fair value in the statement of comprehensive income, which are recorded

in “Unrealized gain/loss on changing in investments in securities held for trading”.

Costs of investment sold during the year are calculated using the weighted average cost method.

Trade and other receivable

Trade and other receivable are stated at their invoice value less allowance for doubtful accounts.

Trade accounts receivable are stated at the net realizable value. Allowance for doubtful accounts is

provided for the estimated losses that may be incurred in collection of receivables. The allowance is gener-

ally based on collection experiences and analysis of debtor aging.

Inventories

Finished goods are valued at the lower of cost or net realizable value.

Raw material, work in process and finished goodswhich arejewelry and diamond size carats and

suppliesare valued at first-in, first-out cost method.

Finished goodswhich are gold jewelry 18K, andsmall stone diamondare valued at first-in, first-out cost method.

Cost comprises all costs of purchases, costs of conversion and other costs incurred in bringing the

inventories to their present location and condition. In the case of manufactured inventories, cost includes an

appropriate share of overhead based on normal operating capacity.

Net realizable value is the estimated selling price in the ordinary course of business less the costs to make the sale.

An allowance is made for all deteriorated, damaged, obsolete and slow-moving inventories.

Building and equipment

Building and equipmentare stated at cost less accumulated depreciation, and allowance for

impairment loss (if any).


115

Depreciation

Depreciation of building and equipmentare calculated by reference to their costs, on the

straight-line basis over estimated useful lives of 5 years.

Depreciation is included in determining income and no depreciation is provided on asset in progress.

Repairs and maintenance are charged to the statements of comprehensive income during the

financial years in which they are incurred. The cost of major renovations is included in the carrying amount

of the asset when it is probable that future economic benefits in excess of the originally assessed standard

of performance of the existing asset will flow to the Company. Major renovations are depreciated over the

remaining useful life of the related asset.

Gains and losses on disposals are determined by comparing proceeds with carrying amount and

are included in operating profit.

Impairment of assets

The carrying amounts of the Company’s assets are reviewed at each reporting period date to

determine whether there is any indication of impairment. If any such indication exists, the asset’s recoverable

amount is estimated.

An impairment loss is recognized whenever the carrying amount of an asset or its cash-generating

unit exceeds its recoverable amount. The impairment loss is recognized in the statements of comprehensive

income unless it reverses a previous revaluation credited to equity, in which case it is charged to equity.

When a decline in the fair value of an available-for-sale financial asset has been recognized directly in

equity and there is objective evidence that the value of the asset is impaired, the cumulative loss that had been

recognized directly in equity is recognized in the statements of comprehensive income even though the financial

asset has not been derecognized. The amount of the cumulative loss that is recognized in the statements

of comprehensive income is the difference between the acquisition cost and the current fair value, less any

impairment loss on that financial asset previously recognized in the statements of comprehensive income.

Calculation of recoverable amount

The recoverable amount is the greater of the assets’ net selling price and value in use. In

assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax

discount rate that reflects current market assessments of the time value of money and the risks specific to

the asset. For an asset that does not generate cash inflows largely independent of those from other assets,

the recoverable amount is determined for the cash-generating unit to which the asset belongs.


116

Reversals of impairment

An impairment loss is reversed if there has been a change in the estimates used to determine

the recoverable amount.

An impairment loss is reversed only to the extent that the asset’s carrying amount does not

exceed the carrying amount that would have been determined, net of depreciation or amortization, if no

impairment loss had been recognized.

Finance lease

Leases of property, plant or equipment which substantially transfer all the risks and rewards of

ownership are classified as finance leases. Finance leases are capitalized at the inception of the lease at

the lower of the fair value of the leased property or the present value of the minimum lease payments. Each

lease payment is allocated to the principal and to the finance costs so as to achieve a constant rate on the

finance balance outstanding. The outstanding rental obligations, net of finance costs, are included in other

long-term payables. The interest element of the finance cost is charged to the statements of comprehensive

income over the lease period. The property, plant or equipment acquired under finance leasing contract is

depreciated over the shorter of the useful life of the asset or the lease term.

Leases not transferring a significant portion of the risks and rewards of ownership to the lessee are classified

as operating leases. Payments made under operating leases (net of any incentives received from the lessor)

are charged to the statements of comprehensive income 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 recognized as an expense in the period in which termination

takes place.

Foreign currency

Foreign currency account transactions

Transactions in foreign currencies are converted at the foreign exchange rates ruling at the

dates of the transactions. Monetary assets and liabilities denominated in foreign currencies at the end of

the reporting period are converted to Thai Baht at the foreign exchange rates ruling at that date. Forward

exchange contracts at the transaction date are converted to Thai Baht by using the contract rates.


117

Outstanding forward exchange contracts are marked to market by comparing contract rates to forward

rates established by the contracting Bank with the same maturity. At the end of year, the unrealized gains

or losses on outstanding forward exchange contracts, calculated as described above, are included within

other receivables or other payables from forward exchange contracts in the statement of financial position.

Gain or loss upon conversion is included in the statements of comprehensive income.

Provisions

A provision is recognized in the statement of financial position when the Company has a present

legal or constructive obligation as a result of a past event, and it is probable that an outflow of economic

benefits will be required to settle the obligation and a reliable estimate can be made of the amount of the

obligation. If the effect is material, provisions are determined by discounting the expected future cash

flows at a pre-tax rate that reflects current market assessments of the time value of money and, where

appropriate, the risks specific to the liability.

Income tax

Current tax is the expected tax payable on the taxable income for the year, using tax rates enacted

at the end of the reporting period.

Dividends paid

Dividends and interim dividend payments are recorded in the financial statements in the period in

which they are approved by the shareholders’ meeting or the Board of Directors.

Basic earnings per share

Basic earnings per share is calculated by dividing net profit for the years by the weighted average

number of ordinary shares outstanding during the yearsas follows:


For the years ended December 31, 2012 and 2011.

2012 2011

Net profit for the years (Baht) 165,865,788.00 131,185,831.47

Weighted average number of ordinary shares (shares)

Issued ordinary shares at the beginning of the years 172,287,750.00 171,121,500.00

Effect of shares issued during the years 151,757.00 169,346.00

Weighted average number of ordinary shares (shares) 172,439,507.00 171,290,846.00

Basic earnings per share (Baht) 0.96 0.77

Diluted earnings per share

Diluted earnings per share for the years ended December 31, 2012 and 2011 are calculated by dividing

the net profit of ordinary shareholders by the sum of the weighted average number of ordinary shares

outstanding during the year plus the weighted average number of shares to be issued for the exercise of

all dilutive potential ordinary shares into ordinary shares in the amount of 1.01 million shares (In 2011: 3.36

million shares).The calculation assumes that the holders will exercise dilutive potential ordinary share into

ordinary shares when the exercise price is lower than fair value of ordinary shares.

The basic earnings per share and the diluted earnings per share are as follows:

For the years ended December 31, 2012 and 2011.

2012

Baht Shares Baht

Weighted average

Net profit number of ordinary Earnings per share

shares

Earnings per share

Basic earnings per share 165,865,788.00 172,439,507.00 0.96

Effect dilutive potential ordinary shares - 947,767.00 -

Diluted earnings per share 165,865,788.00 173,387,274.00 0.96


119

2011

Baht Shares Baht

Weighted average

Net profit number of ordinary Earnings per share

shares

Earnings per share

Basic earnings per share 131,185,831.47 171,290,846.00 0.77

Effect dilutive potential ordinary shares - 3,363,445.00 -

Diluted earnings per share 131,185,831.47 174,654,291.00 0.75

The Company issued warrants to the directors and employees with the details of the warrants in

the Note 19 to the financial statements.

Changes in accounting policies

For the year ended December 31, 2011, the Company has changed accounting policies for the inventory

valuation method from the specific method to the first in – first out method in order to present the cost of

inventories to consistent with the nature of trade and the movement of inventories.The Company adjusted the

inventory valuation with the first in – first out method as at December 31, 2010.That result to the Company

applied adjustment effects of changes in accounting policies with retained earnings as at January 1, 2011.

Effects of changes in accounting policies with the inventory valuation method is as follow:

Baht

Statements of changes in equity

Retained earnings

Beginning balance as at January 1, 2011 94,957,969.15

Effects of changes in accounting policies 2,373,920.47

Adjusted balance 97,331,889.62


4. TRANSACTIONS WITH RELATED PARTIES

The Company has transactions with related parties. These parties are related through common

shareholders and/or directorships. Transactions with related parties as included in the financial

statements are determined at the prices occurring in the normal course of business based on the market

price in general or the price as stipulated in the agreementif no market price exists.

The significant balances of assets, liabilities, and other transactions that occurred with those parties

were shown as follows:

The significant transactions with related parties for the years ended December 31, 2012 and 2011

were as follows:

Baht

2012 2011

Revenue from sales

Mr. Suppasit Khlaikhem - 3,755,418.52

Sales return

Mr. Suppasit Khlaikhem - 5,742,278.50

The significant balancesofrelated parties as at December 31, 2012 and 2011 were as follows:

Baht

2012 2011

Trade accounts receiveable

Mr. Suppasit Khlaikhem 177,047.57

Other payables

Mr. Suppasit Khlaikhem 5,869,949.00

120

-

-

-

-


Directors’ remuneration

Directors’ remuneration represents benefits paid to the directors of the Company in accordance with

Section 90 of the Public Company Limited Act, exclusive of salaries and related benefit payable to directors

who hold executive positions.

For the years ended December 31, 2012 and 2011, the Company paid directors’ remuneration in

the amount of Baht 1.60 million and Baht 1.35million, respectively.

Key management personnel compensation

Key management personnel compensation for the years ended December 31, 2012 and 2011 consisted of:

Baht

2012 2011

Short-term benefits 30,080,892.20 21,362,707.80

Post-employment benefits 5,276,317.77 2,732,352.60

Total key management personnel compensation 35,357,209.97 24,095,060.40

Nature of relationship

Name Nationality Relation Relationship

Mr. Suppasit Khlaikhem Thai Related person Management


5. CASHAND CASH EQUIVALENTS

Cash and cash equivalentsas at December 31, 2012 and 2011 consisted of:

Baht

2012 2011

Cash on hand 1,795,702.66 1,011,807.70

Cash at bank 28,130,187.20 74,775,222.63

Total 29,925,889.86 75,787,030.33

6. SHORT-TERM INVESTMENTS

Short-term investments as at December 31, 2012 and 2011 consisted of:

Baht

2012 2011

Cash at bank - fixed deposits 25,881,739.42 255,029.04

Bill of exchanges -000 60,000,000.00

Open-ended fund 72,229,244.18 -000

Total 98,110,983.60 60,255,029.04


7. TRADE AND OTHER RECEIVABLES

Trade and other receivables as at December 31, 2012 and 2011 consisted of:

Baht

2012 2011

Trade accounts receivable

Related party -000 177,047.57

Other party 77,858,373.60 54,087,182.96

Total 77,858,373.60 54,264,230.53

Less Allowance for doubtful accounts (1,111,957.44) (1,045,394.95)

Trade accounts receivable - net 76,746,416.16 53,218,835.58

Other receivables 4,489.88 1,119,514.92

Trade and other receivable - net 76,750,906.04 54,338,350.50

As at December 31, 2012 and 2011, the Company had outstanding balances of trade accounts

receivable aged by number of months as follows:

Baht

2012 2011

Trade accounts receivable – related party

Current -000 177,047.57

Trade accounts receivable – other party

Current 75,817,906.66 52,677,600.65

Overdue

Less than 3 months 914,259.50 297,624.87

Over 3 months up to 9 months 14,250.00 88,749.99

Over 12 months 1,111,957.44 1,023,207.45

Total 77,858,373.60 54,087,182.96


Movements of allowance for doubtful accounts for the years ended December 31, 2012 and 2011

were as follows:

Baht

2012 2011

Beginning balance 1,045,394.95 1,039,767.45

Add Doubtful accounts 66,562.49 5,627.50

Ending balance 1,111,957.44 1,045,394.95

8. INVENTORIES

Inventories as at December 31, 2012 and 2011 consisted of:

Baht

2012 2011

Raw materials 80,789,644.46 52,866,189.90

Work in process 13,306,363.68 1,486,689.76

Finished goods 361,484,512.93 284,143,146.71

Carat diamond 17,882,164.07 43,212,930.53

Supplies 5,958,541.65 3,014,594.73

Total 479,421,226.79 384,723,551.63


9. RESTRICTED FINANCIAL INSTITUTION DEPOSITS

Restricted financial institution deposits as at December 31, 2012 and 2011 were shown as follows:

Baht

Bank Deposits 2012 2011 Note Guarantee for

fixed 12 months - 25,000,000.00 14 Credit line of long term loans in the amount of

Baht 20 million

12 Credit line of trust receipt/letter of credit in the amount

of Baht 80 million

12 Credit line of forward foreign exchange contract in the

amount of US Dollars 3.35 million

12 Credit line of bank overdrafts in amount of Baht 14.26 million

12 Letter of guarantee issued by bank in the amount of Baht

0.64 million

12 Credit line of promissory notes in the amount of Baht

20 million

รวม - 25,000,000.00

On December 4, 2012, the Company has released its restricted bank fixed deposits of Baht 25 million.


126

10. BUILDING AND EQUIPMENT

Movements of the building and equipment for the years ended December 31, 2012 and 2011

were summarized below:

Baht

Building Fixtures and

improvements office equipment Equipment Vehicles Total

Cost

As at January 1, 2011 4,756,612.59 18,539,522.68 15,647,990.11 2,623,092.15 41,567,217.53

Purchases/transfers in 3,850,755.38 11,001,595.64 976,840.64 - 15,829,191.66

Disposal/transfers out - (699,700.00) - - (699,700.00)

As at December 31, 2011 8,607,367.97 28,841,418.32 16,624,830.75 2,623,092.15 56,696,709.19

Purchases/transfers in - 16,645,558.38 417,000.11 5,473,531.78 22,536,090.27

Disposal/transfers out - (2,094,120.00) (521,540.30) - (2,615,660.30)

As at December 31, 2012 8,607,367.97 43,392,856.70 16,520,290.56 8,096,623.93 76,617,139.16

Accumulated Depreciation

As at January 1, 2011 1,288,251.41 9,296,556.30 14,387,245.95 1,497,885.92 26,469,939.58

Depreciation 1,192,658.18 3,473,198.33 875,903.82 524,618.39 6,066,378.72

Disposal/transfers out - (644,818.66) - - (644,818.66)

As at December 31, 2011 2,480,909.59 12,124,935.97 15,263,149.77 2,022,504.31 31,891,499.64

Depreciation 1,727,314.95 6,078,101.61 413,370.36 984,487.91 9,203,274.83

Disposal/transfers out - (412,103.67) (60,740.85) - (472,844.52)

As at December 31, 2012 4,208,224.54 17,790,933.91 15,615,779.28 3,006,992.22 40,621,929.95

Allowance for impairment of assets

As at January 1, 2011 - - - - -

Loss from impairment - 1,612,884.90 - - 1,612,884.90 of

of assets - 1,612,884.90 - - 1,612,884.90

Reversal loss from - - - - -

impairment of assets - - - - -

As at December 31, 2012 - 1,612,884.90 - - 1,612,884.90


Baht

Building Fixtures and

improvements office equipment Equipment Vehicles Total

Net Book Value

Owned assets 6,126,458.38 14,987,289.99 1,361,680.98 - 22,475,429.35

Assets under finance leases - 1,729,192.36 - 600,587.84 2,329,780.20

As at December 31, 2011 6,126,458.38 16,716,482.35 1,361,680.98 600,587.84 24,805,209.55

Owned assets 4,399,143.43 21,805,899.46 904,511.28 - 27,109,554.17

Assets under finance leases - 2,183,138.43 - 5,089,631.71 7,272,770.14

As at December 31, 2012 4,399,143.43 23,989,037.89 904,511.28 5,089,631.71 34,382,324.31

127

Baht

2012 2011

Depreciation for the years ended December 31 was

included in selling and administrative expenses 9,203,274.83 6,066,378.72

As at December 31

The cost amount before accumulated depreciation

which have been fully depreciated and still in use 20,617,597.76 18,969,356.37

As at December 31, 2012

Rate of rent and service

Lessor Period fees per month Note

(Millions Baht)

Land including construction Third party 3 years 0.68 Can be renewing the contract

lease agreement

Space rental agreements Third party 1 - 3 years 3.05 Can be renewing the contract

if expired. (See Note 28.2.1)


128

11. INTANGIBLE ASSETS

Movements of theintangible assets for the years ended December 31, 2012 and 2011 were

summarized below:

Baht

Computer Software Software under installation Total

Cost

As at January 1, 2011 167,040.00 3,498,400.00 3,665,440.00

Purchases/transfer in 5,466,325.00 2,224,755.00 7,691,080.00

Disposals/transfer out -000 (5,466,325.00) (5,466,325.00)

As at December 31, 2011 5,633,365.00 256,830.00 5,890,195.00

Purchases/transfer in 318,830.00 -000 318,830.00

Disposals/transfer out - (256,830.00) (256,830.00)

As at December 31, 2012 5,952,195.00 -000 5,952,195.00

Amortization

As at January 1, 2011 66,351.63 -00 66,351.63

Amortization/transfer in 1,385,218.82 -00 1,385,218.82

Disposals/transfer out - -00 -00

As at December 31, 2011 1,451,570.45 -00 1,451,570.45

Amortization/transfer in 1,955,128.08 -00 1,955,128.08

Disposals/transfer out - -00 -

As at December 31, 2012 3,406,698.53 -00 3,406,698.53

Book Value

As at December 31, 2011 4,181,794.55 256,830.00 4,438,624.55

As at December 31, 2012 2,545,496.47 -000 2,545,496.47

Baht

2012 2011

Amortization for the years ended December 31 was included in

administrative expenses 1,955,128.08 1,385,218.82


Software

under installation

12. BANK OVERDRAFTS AND SHORT-TERM LOANS FROM FINANCIAL INSTITUTIONS

Bank overdrafts and short-term loans from financial institutions as at December 31, 2012 and 2011 consisted of:

สถาบันการเงิน Type of credit 2012 2011 Unit Referred interest rate

129

First Bank overdrafts 14.26 15.00 Millions Baht MOR

Trust receipt / letter of credit 80.00 80.00 Millions Baht MLR

Promissory notes 20.00 20.00 Millions Baht MOR, Fixed deposit, MLR

Letter of guarantee 0.64 - Millions Baht MOR

Forward exchange contracts 3.35 3.35 Millions

US Dollar

Second Forward exchange contracts 100.00 100.00 Millions Baht

Credit lines

13. TRADE AND OTHER PAYABLES

Trade and other payables as at December 31, 2012 and 2011 consisted of:

Baht

2012 2011

Trade accounts payable 130,752,643.19 119,842,939.47

Other payables 12,541,432.44 11,571,708.89

Accrued expenses 27,763,582.91 21,890,920.17

Total 171,057,658.54 153,305,568.53


Financial

Institutions

14. LOANS FROM FINANCIAL INSTITUTIONS

Loans from financial institutions as at December 31, 2012 and 2011 consisted of:

Baht

2012 2011

Loans from financial institutions 6,666,656.00 13,333,328.00

Less Current portion (6,666,656.00) (6,666,672.00)

Long-term loans from financial institutions - 6,666,656.00

วงเงิน (ล้านบาท) มูลหนี้ (ล้านบาท) Reference Interest rate

Lender 2012 2011 2012 2011 Period Per anum Repayment

ธนาคาร 20.00 20.00 6.67 13.33 Repayment 36 installments MLR Principal repayment on

since December 30, 2010 a monthly basis amount

Baht 0.56 million per month

Movements of loans from financial institutions for the years ended December 31, 2012 and 2011

were as follows:

Baht

2012 2011

Beginning balance 13,333,328.00 20,000,000.00

Increase - -

Decrease (6,666,672.00) (6,666,672.00)

Ending balance 6,666,656.00 13,333,328.00


Credit lines

(Millions Baht)

Principal

(Millions Baht)

131

15. LIABILITY UNDER FINANCE LEASE

Liability under finance leaseas at December 31, 2012 and 2011 consisted of:

2012

Baht

Year Present value Deferred interest Minimum rental

1 1,997,543.77 244,261.75 2,241,805.52

2 - 4 3,723,614.59 190,299.19 3,913,913.78

Total 5,721,158.36 434,560.94 6,155,719.30

2011

Baht

Year Present value Deferred interest Minimum rental

1 1,036,951.97 131,551.71 1,168,503.68

2 1,262,577.02 84,494.07 1,347,071.09

Total 2,299,528.99 216,045.78 2,515,574.77

The Company had entered into a finance lease agreement for purchase of vehicle and equipment

which is payable monthly in the amount of Baht 0.22 million. As at December 31, 2012 the current portion

in the amount of Baht 2 million (In 2011: Baht 1.04 million) was presented under current liabilities

16. CURRENT PORTION OFLONG-TERM DEBTS

Current portion of long-term debts as at December 31, 2012 and 2011 consisted of:

Baht

Note 2012 2011

Loans from financial institutions 14 6,666,656.00 6,666,672.00

Liability under finance lease 15 1,997,543.77 1,036,951.97

Total 8,664,199.77 7,703,623.97


132

17. EMPLOYEE BENEFITS

Post-employment benefit plan

Present value of employee benefit obligations as at January 1 -

Employee benefit expenses in the statements of comprehensive income :

Current service cost 668,251.00

Interest cost 210,604.00

Unrecongnised actuarial profit -

Previous service cost 2,650,139.68

Retired employee benefit -

Employee benefits obligations in the statements of financial position as at December 31, 2012 and 2011

consisted of:

Post-employment benefit plan

Present value of obligations 10,600,558.68

Previous unrecongnised service cost (7,071,564.00)

Employee benefits obligations - recognised in statements of financial position 3,528,994.68

The Companymade defined benefit plan in accordance with severance payment as the labour law

which entitled retired employee within work service period in various rates, such as more than 10 years to

receive severance payment not less than 300 days or 10 months of the last month salary.

The principal actuarial assumptions (expressed as weightedaverages) are as follows:

Discount rate 3.00%

Future salary increases 6.00%

Turnover rate 8.00 - 17.00%

Disability rate 10.00% of Thai Mortality Ordinary Table

Retirement age 60 years

Mortality rate Thai Mortality Ordinary Table 1997

3,528,994.68

962,735.22

291,309.00

(856,534.96)

1,848,808.44

(428,589.39)

5,346,722.99

7,596,197.04

(2,249,474.05)

5,346,722.99

Baht

2012 2011

Baht

2012 2011

3,528,994.68Present value of employee benefit obligations as at December 31


Movement of the present value of employee benefits obligation and employee benefits expenses

instatements of comprehensive incomefor the year ended December 31, 2012 and 2011 as follows:

133

18. SHARE CAPITAL

The Company issued ordinary shares in the amount of 1,166,250 shares offering to exercise warrants

for directors and employees of 1,166,250 units (see Note 19) at par value of Baht 1 and the Company

registered the change of paid-up share capital from Baht 171.12 million to Baht 172.29 million with the

Ministry of Commerce on November 9, 2011.

The Company issued ordinary shares in the amount of 1,009,875 shares offering to exercise

warrants for directors and employees of 1,009,875 units (see Note 19) at par value of Baht 1 and the

Company registered the change of paid-up share capital from Baht 172.29 million to Baht 173.30 million

with the Ministry of Commerce on November 7, 2012.

19. WARRANTS

The Board of Directors’ Meeting held on July 2, 2008 and the Extraordinary Meeting of Shareholders held

on August 27, 2008, approved the issuance of Employee Stock Option Plan: ESOP in the amount of 4,997,500

warrants to the directors and employees. The preliminary details of the warrants are as described below:

Typeof Securities : Warrants purchasing ordinary shares of Jubilee Enterprise Public Company

Limitedto allotto the directors and employees.

Typeof Warrants : Specified warrant’s holder and not transferable.

Term of Warrants : 5 years from the issuing date of warrants.

Number of Warrants : 4,997,500 units

Offering Price : 0 Baht per unit.

Exercise Ratio : 1 unit of warrant to 1 ordinary share.

Exercise Price : Baht 1


134

Exercise Period : The first 3 days after the Company issued warrants to directors and

employees exercisable at end of 1 year, 25% of the warrants

have been allocated.

The second 3 days after the Company issued warrants to directors and

employees exercisable at end of 2 years, 50% of the warrants


The third 3 days after the Company issued warrants to directors and

employees exercisable at end of 3 years, 75% of the warrants


The fourth 3 days after the Company issued warrantsto directors and

employees exercisable at end of 4 years, all of the warrants


The fifth 7 days after the Company issued warrantsto directors and

employees exercisable at end of 5 years, all of the warrants

have been allocated

Holders of warrants are excercisable to ordinary shares, which is scheduled during October 28-30

of each year asfollows:

Year LotThe warrants which can

exercise to ordinary shares

The warrants which were

exercised to ordinary share


not yet excercised


canceled

2553 1 1,249,375.00 1,121,500.00 66,000.00 61,875.00

2554 2 1,315,375.00 1,166,250.00 - 149,125.00

2555 3 1,249,375.00 1,009,875.00 - 239,500.00

2556 4 1,249,375.00 - - -


135

20 . DIVIDEND PAID

The Board of Directors’ Meeting held on August 8, 2012, a resolution was passed to approve the

payment of an interim dividend at the rate of Baht 0.30 per share, in the total amount of Baht 51.69 million.

At the Ordinary General Meeting of Shareholders held on April 23, 2012, a resolution was passed to

approve the payment of a dividend at the rate of Baht 0.29 per share, in the total amount of Baht 49.96 million.

The Board of Directors’ Meeting held on August 9, 2011, a resolution was passed to approve the

payment of an interim dividend at the rate of Baht 0.23 per share, in the total amount of Baht 39.36 million.

Subsequently,at the Ordinary General Meeting of Shareholders held on April 23, 2012, ratified such payment

of interimdividend.

At the Ordinary General Meeting of Shareholders held on April 19, 2011, a resolution was passed to

approve the payment of dividend at the rate of Baht 0.20 per share, in the total amount of Baht 34.22 million.

21. SHARE PREMIUM

Section 51 of the Public Limited Companies Act B.E. 2535 requires companies to set aside share

subscriptions received in excess of the par value of the shares issued to a reserve account (“share premium”).

Share premium is not available for dividend distribution.

22. LEGAL RESERVE

According to the Public Limited Companies Act B.E. 2535, the Company is required to set aside

a statutory reserve at least 5 percent of its net profit after deducting accumulated deficit brought forward

(if any) until the reserve reaches 10 percent of the registered share capital. The legal reserve could not be

used for dividend payment.


136

23. EXPENSES BY NATURE

Significant expenses by nature for the years ended December 31, 2012 and 2011 consisted of:

Baht

2012 2011

Changes in finished goods and work in process 63,830,273.68 75,392,781.87

Purchases of finished goods 197,658,496.79 131,664,277.43

Raw materials and supplies used 543,927,370.01 426,996,795.44

Employee expenses 70,117,444.76 55,396,402.52

Depreciation and amortization 14,147,527.10 7,725,238.88

Advertising and public relation expenses 10,941,013.91 7,308,685.51

Sale promotion expenses 115,737,016.33 83,985,204.87

Rental and service expenses 39,258,953.60 24,897,720.48

24. FINANCE COSTS

Finance costs for the years ended December 31, 2012 and 2011 consisted of

Baht

2012 2011

Interest expense 952,445.63 1,296,562.71

Bank charge - 1,500.00

Total 952,445.63 1,298,062.71

25. PROVIDENT FUND

The Company and its employees jointly registered a provident fund scheme under the Provident Fund

Act B.E. 2530. The fund is contributed to by both the employees and the Company. The fund is managed

by Kasikorn Asset Management Company Limited. This fund is registered under the conditions of Ministry

of Finance and the fund is managed by the approved fund manager.


137

26. SEGMENT INFORMATION

Management considers that the Company operates in a single line of business, operate a business

as a retail and wholesale of jewelry, and has therefore only one business segment.

Management considers that the Company operate in a single geographic area, namely in Thailand,

and has therefore only one geographic segment.

27. INCOME TAX

Incomes tax for the years ended December 31, 2012 and 2011 was calculated at a rate of 20 percent

of profit before income tax after adding back reserve and expenses that are not allowed to hold as an

expensein calculating income tax and less of income exempt included as income. The tax rate which used to

calculate income tax is the rate according to Decree No. 467 (2007), dated October 7, 2007. The Company

recorded the corporation income tax as expense for each of the year and recorded the accrued portion as

liabilities in the statements of financial position.

28. COMMITMENTS

As at December 31, 2012 the Company had commitments as follows:

28.1 Commitments from letters of guarantee

The letters of guarantee issued by banks used as collateral for the production of

goods agreement paid in the amount of Baht 0.64 million (see Note 12).

28.2 Commitments under the agreements:

28.2.1 Paid under space rental agreements with other persons, the monthly rental and

service fee is in the amount of Baht 3.73 million (see Note 10).

28.2.2 Paid under the computer software agreement with other person in the amount of Baht

0.33 million, and paid under purchase and maintenance computer software in the

rateof Baht 0.59 million per year.

28.2.3 Paid under renovated sales office in agreement in the remaining amount of Baht

0.56 million.


138

29. DISCLOSURE OF FINANCIAL INSTRUMENTS

Accounting policies

The detail of significant accounting policies and methods used, classification of financial assets and

financial liabilities including valuation, basis of recognition of income and expenses are disclosed in Note 3.

Financial risk management policies

The Company is exposed to the fluctuations in interest rate and foreign exchange rates in the mar-

ket and the risks from default on the agreement by counterparties. The Company had the risk management

polices as follows:

Interest rate risk

Interest rate risk is the fluctuation of the market interest rate in the future which will affect the

Company’s operation and cash flows. The Company has the interest rate risk from cash and deposits at

bank and loans because the interest rate of financial assets and financial liabilities fluctuated based on the

market rate. In addition, the Company has not engaged in any hedging contracts.

Foreign currency risk

The Company’s exchange rate risk primarily involves the purchases of goods in foreign currencies. As

at December 31, 2012 and 2011 the Company had assets and liabilities in foreign currencies as follows:

2012 2011 2012 2011

Hedging

US Dollars - - 260,665.89 708,221.04

Non-Hedging

US Dollars 39,482.46 27,793.17 877,601.99 1,720,541.99

Hong Kong Dollars 9,919.00 20,882.10 - -

Singapore Dollars 3,842.00 - - -

Renminbi (Republic of Chaina) 734.00 2,710.00


Assets in

foreign currency

Liabilities in

foreign currency

139

Credit risk – trade accounts receivable

The Company has a policy on hedging credit risk from trade accounts receivable by forming conser-

vative credit policy and determining that the receipt from sales of goods be made partial advance payment

for goods. Therefore, the Company expects that the loss from collection of those trade accounts receivable

should not exceed the provision for doubtful accounts.

Fair value

Most of the financial assets are cash at bank and trade accounts receivable which are short-term

credit and financial liabilities. Most of the financial liabilities are trade accounts payable and loans with its

interest rates close to the market rate. The carrying amount of the financial assets and financial liabilities are

not significantly different from their fair value.

30. RECLASSIFICATION

The Company has reclassified certain accounts in the statements of comprehensive income for the

year ended December 31, 2011 to conform with the presentation of the financial statements of this year

which consisted of:

2011

(Unit : Baht)

Before After

reclassification Reclassification reclassification

Statement of comprehensive income

Selling expenses 145,180,570.83 9,443,861.26 154,624,432.09

Administrative expenses 80,938,379.06 (9,443,861.26) 71,494,517.80


140

31. EVENT AFTER THE REPORTING PERIOD

The Board of Directors’ Meeting held on February 22, 2012, a resolution topropose to the Ordinary

General Meeting of Shareholders to approve the payment of a dividend at the rate of Baht 0.30 per share,

in the total amount of Baht 51.99 million.

32. APPROVAL OF FINANCIAL STATEMENTS

These financial statements have been approved for issue by the Company’s Board of Directorson

February 22, 2013


jubile: annual report 2012

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