ta annual report 2008 - tafi industries berhad to page 20 (2.1mb).pdfte r k ye w te e was appointed...

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CONTENTS

P a g e s

2

3

4

5 - 9

1 0 - 1 1

1 2 - 1 8

1 9

20 - 23

24

25 - 27

28 - 29

30

31 - 32

33 - 34

35 - 37

38 - 7 2

7 3

7 3

7 4 - 7 5

7 6

7 7 - 7 8

7 9 - 8 1

8 2

En c l o s e d

Vision & Mission Statements

C or p or ate Infor mation

G r ou p Str u c tu r e

P r ofile of D ir ec tor s

Statement f r om th e E x ec u tiv e C h air man

C or p or ate G ov er nanc e Statement

Inter nal C ontr ol Statement

A u d it C ommittee R ep or t

Statement of th e D ir ec tor s’ R esp onsib ilities

D ir ec tor s’ R ep or t

Ind ep end ent A u d itor s’ R ep or t

Inc ome Statements

B alanc e Sh eets

Statements of C h ang es in E q u ity

C ash F low Statements

N otes to th e F inanc ial Statements

Statements b y D ir ec tor s

D ec lar ation b y th e D ir ec tor P r imar ily R esp onsib le for th e

F inanc ial Manag ement of th e C omp any

A naly sis of Sh ar eh old ing s

Sh ar eh old ing s of D ir ec tor s

L ist of P r op er ties

N otic e of A nnu al G ener al Meeting

Statement A c c omp any ing N otic e of A nnu al G ener al Meeting

F or m of P r ox y

TAFI INDUSTRIES BERHAD (640935-P) ANNUAL REPORT 2008 2


CORPORATE INFORMATION

TA

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ANNUAL REPORT 2008

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TERK YEW TEE

Executive Director

M a la y s ia n , A g e 5 4

Te r k Ye w Te e was appointed to the TAFI Board on 26 November 2004 and is presently the Executive Director. Mr. Terk

started his own furniture business in 1 9 7 9 and has helmed several furniture companies before taking over TA in 1 9 8 8 .

Mr. Terk is the founder and promoter of the TAFI G roup and was one of the pioneers in the manufacturing of knocked-down

of f ice furniture made from melamine- laminated particleboards.

Mr. Terk is not a director of any other public companies. S ave that he is the spouse of L ow Ah H uay, a director of TA, Mr. Terk

does not have any family relationship with any other director and/ or substantial shareholder of the C ompany nor has any

personal interest in any business arrang ement involving the C ompany. H e has not been convicted of any offences within the

past ten (1 0) years.

Mr. Terk Y ew Tee attended all four (4) of the Board meeting s which were held in the f inancial year ended 3 1 December 2008 .

Mr. Terk has not attended any training during the f inancial year due to time constraints and a tig ht work schedule.


S A W EN G G U A N

Executive C h a irm a n

M em b er of R em un era tion C om m ittee

M a la y s ia n , A g e 5 1

S a w En g G u a n was appointed to the TAFI Board on 26 November 2004 as the Executive Director and on 28 Aug ust 2007 , was

appointed the Executive C hairman of the C ompany. H e is a member of the R emuneration C ommittee and was a member

of the Audit C ommittee until his resig nation on 21 November 2008 .

Mr. S aw holds a Diploma in Marketing from the U niversity Malaya and C hartered Accountant from U niversity of C anterbury,

New Z ealand and is a member of the Malaysian Institute of Accountants ( ” MIA” ) and Malaysian Institute of Taxation (” MIT” ) .

Mr. S aw is also the principal partner of Messrs. G uan & Associates, a P ublic Accounting Firm in Malaysia.

S ince the 1 9 9 0’s, Mr. S aw had ventured into the timber related business in particular, log g ing and the manufacturing of of f ice

and household furniture. H e has natural f lair and acumen in his business ventures and has excelled in vast property portfolio

investment including the construction of residential and commercial properties from medium to upscale rang e. W ith respect to

his leardership in driving the C ompany g lobally, he has been actively upg rading the Manag ement in terms of operations throug h

computerisation, expanding and re-structuring territory sales force to increase international market share and in terms of

branding , his current mission is to spread the C ompany’s brand name “ TA” and “ H O ” g lobally and to achieve the G overnment’s

vision of selling Malaysian brand to the world under the tag line “ P roudly made in Malaysia”.

Mr. S aw is not a director of any other public companies. H e is the son of Mr. S aw H an L im, a substantial shareholder and

promoter of the C ompany. Apart from this, he does not have any family relationship with any other substantial shareholders

or directors of the C ompany. H e has not been convicted of any offences within the past ten (1 0) years.

Mr. S aw has not entered into any transactions, whether directly or indirectly, which has a conflict of interest with TAFI other

than those disclosed in Note 20 in the accompanying f inancial statements.

Mr. S aw Eng G uan attended all four (4) of the Board meeting s which were held in the f inancial year ended 3 1 December

2008 .

Training s attended by Mr. S aw during the f inancial year are as follows:

- Attending MBA prog ram org anised by U niversity of Notting ham, Malaysia.

- “ Tax manag ement S eminar” org anised by Deloitte K asimC han.

- “ Firm of the Future Forum” org anised by MIA.

P RO F I L E O F D IREC TO RS


TUAN HAJI AZHAR BIN NAYAN

Non-Independent Non-Executive Director

Malaysian, Age 46

Tu a n Ha j i Az h a r b i n Na y a n w as ap p o int ed t o t h e T AF I B o ar d o n 2 6 N o v em b er 2 0 0 4 as t h e N o n- Ind ep end ent N o n- E x ec u t iv e

D ir ec t o r.

T u an H aji Az h ar h o ld s a B ac h elo r o f S c ienc e, m ajo r ing in Ac c o u nt ing and E c o no m ic s f r o m t h e N o r t h en Illino is U niv er sit y,

U S A and a Mast er s in B u siness Ad m inist r at io n, m ajo r ing in F inanc e f r o m t h e U niv er sit y o f Misso u r i, U S A. H e is p r esent ly a

m em b er o f t h e Am er ic an Inst it u t e o f C er t if ied P u b lic Ac c o u nt ant s.

H e h as b een w it h L em b aga T ab u ng H aji as t h e gener al m anager sinc e 1 9 8 9 . H e r ep r esent s L em b aga T ab u ng H aji, a su b st ant ial

c o r p o r at e sh ar eh o ld er, o n t h e B o ar d o f T AF I.

T u an H aji Az h ar is a d ir ec t o r o f O r nap ap er B er h ad and a few p r iv at e lim it ed c o m p anies. H e d o es no t h av e any fam ily

r elat io nsh ip w it h any d ir ec t o r and / o r su b st ant ial sh ar eh o ld er o f t h e C o m p any no r h as any p er so nal int er est in any b u siness

ar r angem ent inv o lv ing t h e C o m p any. H e h as no t b een c o nv ic t ed o f any o f fenc es w it h in t h e p ast ( 1 0 ) year s.

T u an H aji Az h ar b in N ayan at t end ed all f o u r (4) o f t h e B o ar d m eet ings w h ic h w er e h eld in t h e f inanc ial year end ed 3 1

D ec em b er 2 0 0 8 .

T r ainings at t end ed b y T u an H aji Az h ar d u r ing t h e f inanc ial year ar e as fo llo w s:

- “ 4t h Asia P ac if ic Au d it & G o v er nanc e S u m m it 2 0 0 8 ” o r ganised b y C o lu m b u s C ir c le S d n. B h d .

- “ IIAM C o nfer enc e 2 0 0 8 ” o r ganised b y Inst it u t e o f Int er nal Au d it o r s Malaysia ( ” IIAM” ).

- “ Im p lem ent ing an E f fec t iv e S yst em o f Int er nal C o nt r o l f o r S ME ’s and P u b lic C o m p anies” o r ganised b y IIAM and

S u r u h anjaya S yar ik at Malaysia.

D ATO ’ HAJI ZAINAL RAHIM BIN D ATO ’ HAJI D ARUS

Non-Independent Non-Executive Director

Malaysian, Age 61

D a t o ’ Ha j i Za i n a l Ra h i m b i n D a t o ’ Ha j i D a r u s w as ap p o int ed t o t h e T AF I B o ar d o n 2 6 N o v em b er 2 0 0 4 as t h e N o n-

Ind ep end ent N o n- E x ec u t iv e D ir ec t o r. H e h as a B ac h elo r D egr ee in Ant h r o p o lo gy and S o c io lo gy f r o m t h e U niv er sit y o f

Malaya.

D at o ’ H aji Z ainal h as o v er t h ir t y ( 3 0 ) year s ex p er ienc e in t h e p u b lic sec t o r and h is last p o st ing in t h e p u b lic sec t o r p r io r t o h is

r et ir em ent w as as t h e D ist r ic t O f f ic er o f P ek an, P ah ang. C u r r ent ly, h e is t h e r ep r esent at iv e o f Y P P lant at io n H o ld ings S d n. B h d .,

a su b st ant ial c o r p o r at e sh ar eh o ld er, o n t h e B o ar d o f T AF I.

D at o ’ H aji Z ainal is no t a d ir ec t o r o f any o t h er p u b lic c o m p anies. H e d o es no t h av e any fam ily r elat io nsh ip w it h any d ir ec t o r

and / o r su b st ant ial sh ar eh o ld er o f t h e C o m p any no r h as any p er so nal int er est in any b u siness ar r angem ent inv o lv ing t h e

C o m p any. H e h as no t b een c o nv ic t ed o f any o f fenc es w it h in t h e p ast t en (1 0 ) year s.

D at o ’ H aji Z ainal R ah im b in D at o ’ H aji D ar u s at t end ed all f o u r (4) o f t h e B o ar d m eet ings w h ic h w er e h eld in t h e f inanc ial year

end ed 3 1 D ec em b er 2 0 0 8 .

D at o ’ H aji Z ainal h as no t at t end ed any t r aining d u r ing t h e f inanc ial year d u e t o t im e c o nst r aint s and a t igh t w o r k sc h ed u le.

P RO F IL E O F D IRE C TO RS ( c o nt ’d )


KAMARUDDIN BIN KOSKANI ABDUL HAMID

(Alternate director to Dato’ Haji Zainal Rahim bin Dato’ Haji Darus)

N on- Indep endent N on- E x ecutiv e Director

Malaysian, Age 47

Ka m a r u d d i n Bin Ko s k a n i Ab d u l Ha m i d w as ap p o int ed t o t h e B o ar d o n 2 6 N o v em b er 2 0 0 4 as t h e alt er nat e d ir ec t o r t o D at o ’

H aji Z ainal R ah im b in D at o ’ H aji D ar u s.

E nc ik K am ar u d d in h o ld s a D ip lo m a in P lant ing Ind u st r y and Managem ent f r o m t h e MAR A Inst it u t e o f T ec h no lo gy and a

B ac h elo r D egr ee in B u siness Ad m inist r at io n f r o m t h e Int er nat io nal Islam ic U niv er sit y, Malaysia. In 2 0 0 1 , h e o b t ained a Mast er

o f B u siness Ad m inist r at io n f r o m t h e U niv er sit y U t ar a Malaysia.

E nc ik K am ar u d d in jo ined Y P P lant at io n H o ld ings S d n. B h d . in 1 9 9 4 and c u r r ent ly h o ld s t h e p o sit io n o f G ener al Manager.

E nc ik K am ar u d d in is a d ir ec t o r o f K inst eel B er h ad and a few p r iv at e lim it ed c o m p anies. H e d o es no t h av e any fam ily

r elat io nsh ip w it h any d ir ec t o r and / o r su b st ant ial sh ar eh o ld er o f t h e C o m p any no r h as any p er so nal int er est in any b u siness

ar r angem ent inv o lv ing t h e C o m p any. H e h as no t b een c o nv ic t ed o f any o f fenc es w it h in t h e p ast t en (1 0 ) year s.

E nc ik K am ar u d d in B in K o sk ani Ab d u l H am id at t end ed all f o u r (4) o f t h e B o ar d m eet ings w h ic h w er e h eld in t h e f inanc ial year

end ed 3 1 D ec em b er 2 0 0 8 .

T r aining at t end ed b y E nc ik K am ar u d d in d u r ing t h e f inanc ial year ar e as fo llo w s:

- “ P em ant ap an P r est asi u nt u k Menc ap ai K eb er k esanan O r ganisasi” o r ganised b y G em Asia.

- “ W o r k sh o p P engu r u san B er h ik m ah ” o r ganised b y Q I C o nsu lt ant s S d n. B h d .

- “ Managing K P I’s” o r ganised b y T im es Managem ent T r aining S d n. B h d .

- “ W o r k sh o p Im p lem ent ing R S P O P r inc ip les & C r it er ia in P lant at io ns - a P r ac t ic al Ap p r o ac h ” o r ganised b y Q A P lu s Asia

P ac if ic S d n. B h d .

T AN SRI DAT O’ DR. SY E D J ALALUDIN BIN SY E D SALIM

Indep endent N on- E x ecutiv e Director

C hairman of N omination C ommittee and Remuneration C ommittee

Malaysian, Age 6 5

T a n Sr i Da t o ’ Dr . Sy e d J a l a l u d i n b i n Sy e d Sa l i m w as ap p o int ed t o t h e B o ar d o n 2 6 N o v em b er 2 0 0 4 as t h e Ind ep end ent N o n-

E x ec u t iv e D ir ec t o r. H e is t h e C h air m an o f t h e N o m inat io n C o m m it t ee and t h e R em u ner at io n C o m m it t ee.

T an S r i D at o ’ D r. S yed h o ld s a B ac h elo r o f V et er inar y S c ienc e f r o m t h e U niv er sit y o f P anjab and a Mast er o f P h ilo so p h y f r o m

U niv er sit y o f L o nd o n, U K . H is o t h er q u alif ic at io ns ar e D o c t o r o f P h ilo so p h y ( P h D ) f r o m t h e U niv er sit y o f L o nd o n, U K , D o c t o r

o f S c ienc e ( H o no r is C au sa) f r o m t h e U niv er sit y o f H u ll, U K , and H o no r is C au sa f r o m t h e S o k o U niv er sit y, J ap an.

T an S r i D at o ’ D r. S yed h ad an illu st r io u s c ar eer as a lec t u r er and as h ead o f d ep ar t m ent s in t h e f ield o f agr ic u lt u r e and anim al

sc ienc e and v et er inar y m ed ic ine in t w o ( 2 ) u niv er sit ies in Malaysia. H e w as also a p ast V ic e- C h anc ello r o f t h e U niv er sit y P u t r a

Malaysia.

H e is c u r r ent ly t h e C h air m an o f B ank K er jasam a R ak yat Malaysia B er h ad and also a d ir ec t o r o f t h e E sso B er h ad and a few p r iv at e

lim it ed c o m p anies.

T an S r i D at o ’ D r. S yed d o es no t h av e any fam ily r elat io nsh ip w it h any d ir ec t o r and / o r su b st ant ial sh ar eh o ld er o f t h e C o m p any

no r h as any p er so nal int er est in any b u siness ar r angem ent inv o lv ing t h e C o m p any. H e h as no t b een c o nv ic t ed o f any o f fenc es

w it h in t h e p ast t en (1 0 ) year s.

T an S r i D at o ’ D r. S yed J alalu d in b in S yed S alim at t end ed t w o ( 2 ) o f t h e fo u r (4) B o ar d m eet ings w h ic h w er e h eld in t h e

f inanc ial year end ed 3 1 D ec em b er 2 0 0 8 .

T r ainings at t end ed b y T an S r i D at o ’ D r. S yed d u r ing t h e f inanc ial year ar e as fo llo w s:

- “ B r ief ing o n Am end m ent s t o t h e L ist ing R eq u ir em ent s” c o nd u c t ed b y E MB Int er nal T r aining.

- “ D isc o v er ing t h e D o m inant D r iv er s o f B o ar d W o r k ” c o nd u c t ed b y MIN D A.

- “ S t r at egic Mar k et ing S em inar ” c o nd u c t ed b y P r o f P h ilip K o t ler.

P ROF ILE OF DIRE C T ORS ( c o nt ’d )


GOH CHOON HOCK

Independent Non-Executive Director

C h a irm a n of A udit C om m ittee

M em b er of Nom ina tion C om m ittee a nd R em unera tion C om m ittee

Malaysian, Age 48

Go h Ch o o n Ho c k w as ap p o int ed t o t h e B o ar d o n 2 6 N o v em b er 2 0 0 4 as t h e Ind ep end ent N o n- E x ec u t iv e D ir ec t o r and o n 2 8

Au gu st 2 0 0 7 w as ap p o int ed as C h air m an o f t h e Au d it C o m m it t ee. H e is also a m em b er o f t h e N o m inat io n C o m m it t ee and t h e

R em u ner at io n C o m m it t ee.

Mr. G o h h o ld s a B ac h elo r o f C o m m er c e m ajo r ing in Ac c o u nt anc y f r o m t h e U niv er sit y o f C ant er b u r y, N ew Z ealand .

H e is a m em b er o f t h e Malaysian Inst it u t e o f Ac c o u nt ant s and t h e Inst it u t e o f C h ar t er ed Ac c o u nt ant s o f N ew Z ealand .

Mr. G o h h as o v er f if t een (1 5 ) year s ex p er ienc e as p ar t o f senio r m anagem ent in t h e f inanc ial ser v ic es ind u st r y o f w h ic h , d u r ing

t h e im m ed iat e p ast t en (1 0 ) year s, h e h ad h eld p o sit io ns as S enio r G ener al Manager and E x ec u t iv e D ir ec t o r o f a st o c k b r o k ing

c o m p any.

Mr. G o h is no t a d ir ec t o r o f any o t h er p u b lic c o m p anies. H e d o es no t h av e any fam ily r elat io nsh ip w it h any d ir ec t o r

and / o r su b st ant ial sh ar eh o ld er o f t h e C o m p any no r h as any p er so nal int er est in any b u siness ar r angem ent inv o lv ing t h e

C o m p any. H e h as no t b een c o nv ic t ed o f any o f fenc es w it h in t h e p ast t en (1 0 ) year s.

Mr. G o h C h o o n H o c k at t end ed t h r ee ( 3 ) o f t h e fo u r (4) B o ar d m eet ings w h ic h w er e h eld in t h e f inanc ial year end ed 3 1

D ec em b er 2 0 0 8.

T r aining at t end ed b y Mr. G o h d u r ing t h e f inanc ial year is as fo llo w :

- “ H & R B lo c k T ax T r aining C o u r se” c o nd u c t ed b y H & R B lo c k T ax Ac c o u nt ant s.

T A N CHU A N Y ONG


M em b er of A udit C om m ittee, Nom ina tion C om m ittee a nd R em unera tion C om m ittee

Malaysian, Age 5 3

T a n Ch u a n Y o n g w as ap p o int ed t o t h e B o ar d o n 2 6 N o v em b er 2 0 0 4 as t h e Ind ep end ent N o n- E x ec u t iv e D ir ec t o r. H e r esigned

as C h air m an o f t h e Au d it C o m m it t ee o n 2 8 Au gu st 2 0 0 7 and r em ained o n t h e C o m m it t ee as a m em b er. H e is also a m em b er

o f b o t h t h e N o m inat io n C o m m it t ee and t h e R em u ner at io n C o m m it t ee.

Mr. T an h o ld s a B ar r ist er -at - L aw f r o m T h e H o no u r ab le S o c iet y o f L inc o ln’s Inn. H e is c u r r ent ly an Ad v o c at e & S o lic it o r and

N o t ar y P u b lic as w ell as a p ar t ner o f Messr s. T an C h u an Y o ng & S .M. C h an Ad v o c at es & S o lic it o r s. H e h as b een a m em b er o f

t h e Malaysian B ar sinc e 1 9 83 .

Mr. T an is no t a d ir ec t o r o f any o t h er p u b lic c o m p anies. H e d o es no t h av e any fam ily r elat io nsh ip w it h any d ir ec t o r and / o r

su b st ant ial sh ar eh o ld er o f t h e C o m p any no r h as any p er so nal int er est in any b u siness ar r angem ent inv o lv ing t h e C o m p any.

H e h as no t b een c o nv ic t ed o f any o f fenc es w it h in t h e p ast t en (1 0 ) year s.

Mr. T an C h u an Y o ng at t end ed all f o u r (4) t h e B o ar d m eet ings w h ic h w er e h eld in t h e f inanc ial year end ed 3 1 D ec em b er

2 0 0 8.

Mr. T an h as no t at t end ed any t r aining d u r ing t h e f inanc ial year d u e t o t im e c o nst r aint s and a t igh t w o r k sc h ed u le.

P R OF I L E OF D I R E CT OR S ( c o nt ’d )


NG SIEW THONG


M em b er of A udit C om m ittee, Nom ina tion C om m ittee a nd R em unera tion C om m ittee

Malaysian, Age 52

Ng Sie w Th o n g w as ap p o int ed t o t h e B o ar d o n 9 J anu ar y 20 0 6 as t h e Ind ep end ent N o n- E x ec u t iv e D ir ec t o r. H e is a m em b er o f

t h e Au d it C o m m it t ee, t h e N o m inat io n C o m m it t ee and t h e R em u ner at io n C o m m it t ee.

Mr. N g h o ld s a B ac h elo r o f S o c ial S c ienc e ( H o no u r s) m ajo r ing in B u siness Managem ent f r o m t h e U niv er sit i S ains Malaysia.

Mr. N g h as o v er f if t een (1 5) year s ex p er ienc e as p ar t o f senio r m anagem ent o f v ar io u s m u lt inat io nal c o m p anies o f w h ic h , f o r

t h e im m ed iat e p ast t en (1 0 ) year s, h e w as a m em b er o f t h e b o ar d o f d ir ec t o r s o f h is p ast im m ed iat e c o m p any w it h an ex ec u t iv e

f u nc t io n. H e is p r esent ly t h e Managing D ir ec t o r o f G o o d w ay R u b b er C o m p any P t y. L t d ., Au st r alia, a su b sid iar y o f G o o d w ay

Int egr at ed Ind u st r ies B er h ad .

Mr. N g d o es no t h av e any fam ily r elat io nsh ip w it h any d ir ec t o r and / o r su b st ant ial sh ar eh o ld er o f t h e C o m p any no r h as any

p er so nal int er est in any b u siness ar r angem ent inv o lv ing t h e C o m p any. H e h as no t b een c o nv ic t ed o f any o f fenc es w it h in t h e

p ast t en (1 0 ) year s.

Mr. N g S iew T h o ng at t end ed all f o u r ( 4 ) t h e B o ar d m eet ings w h ic h w er e h eld in t h e f inanc ial year end ed 3 1 D ec em b er 20 0 8 .

Mr. N g h as no t at t end ed any t r aining d u r ing t h e f inanc ial year d u e t o t im e c o nst r aint s and a t igh t w o r k sc h ed u le.

P R OF IL E OF D IR EC TOR S ( c o nt ’d )

Dear Shareholders,

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

S tatements of the C ompany and the G roup for the financial y ear ended 3 1 December 2 0 0 8 .

Financial Performance

Y ear 2 0 0 8 had been a turbulent y ear. In spite of escalating raw material prices and the y o-y o mov ement of the U S Dollar

ag ainst the M alay sian Ring g it last y ear, TAFI w ould hav e been on track to record its most profitable y ear if not for the

setback from the brutal g lobal financial crisis w hich reared its ug ly head in the mid of third q uarter 2 0 0 8 .

Despite the sudden dow nw ard spiral of the w orld economy w hich had deeply eroded and shattered consumer confidence

w orldw ide, I humbly report a profitable set of results ev en as many industry peers are in the red. For the y ear ended

3 1 December 2 0 0 8 , G roup profit before tax fell 1 7 .5 % to RM 6 .0 7 million from RM 7 .3 5 million in 2 0 0 7 on the back

of hig her rev enue. G roup rev enue rose 1 4 % to RM 6 2 .0 6 million from RM 5 4 .2 8 million the y ear before.

The rev enue g row th w as the fruition of measures tak en since the past three (3 ) y ears such as internal re-structuring ,

consolidation of the manufacturing sy stems and processes, automation and computerisation as w ell as our cost-cutting

measures including improv ement to the supply chain manag ement, hav e all helped to place the G roup in a better position

to sail throug h the economic storm last y ear.

During the financial y ear just ended, the G roup had continued w ith ex panding its product rang e and had came up w ith

more innov ativ e and contemporary y et affordable desig ns especially for its home furniture, motiv ated by the v ision

to improv e the lifesty le of its customers.

A new factory w hich w as acq uired in mid last y ear for manufacturing of chairs, a new seg ment, and board lamination w ould be

operational by third q uarter of the y ear.

Besides unrelenting efforts to further w iden and mak e deeper inroads into new and ex isting ex port mark ets, the G roup is

also re-focusing on the local domestic mark et and has been embark ing on projects w hich are non-traditional to the industry .

Basic earning s per share w as 6 .5 sen compared to 7 .9 sen the prev ious y ear.

E nv ironment ally Friend ly and C ons u mer Friend ly Prod u ct s

The G roup, in k eeping closely to its mission to be an env ironmentally friendly g lobal enterprise for sustainable g row th that

lasts, has applied for and w as aw arded the FS C (Forest S tew ardship C ouncil) certification on 2 3 J une 2 0 0 8 . The FS C

certification adds v alue to the G roup’s products and has accorded us a competitiv e adv antag e especially w hen

mark eting to g reen countries.

Being ev er mindful to leav e sustainable footprints for the future g eneration, the G roup has been producing more

eco-friendly products by combining more biodeg radable materials in the manufacturing of its furniture products.

C hairs, the G roup’s new product line, w ill be erg onomically desig ned to bring chiropractic health benefits to its users

w hile at the same time, g iv ing max imum comfort.

M easures to preserv e and to better harness energ y and especially the usag e of w ater on a more efficient basis to minimise

w astag e and stress to the env ironment hav e been an ong oing affair.

C aring E mp loy er

The G roup has alw ay s been k now n as and prides itself to be a caring employ er.

Being a labour intensiv e industry , M anag ement understands the streng th of the G roup lies in hav ing a strong , capable

and committed w ork force from the top to the bottom of the hierarchy . To this end, its human capital is put throug h

reg ular training and education w ith the objectiv e to empow er, enhance and enrich them. M anag ement also reg ularly finds w ay s

to improv e factory w ork ing conditions such as simplify ing processes and v ia computerisation and automation, w ith the objec-

tiv e to minimise strain and injuries at the w ork place and also, to improv e operating efficiency .

S T A T E M E N T FR O M T H E E X E C U T I V E C H A I R M A N


STATEMENT FROM THE EXECUTIVE CHAIRMAN (cont’d)


The Board of Directors considers that it has complied with the Best Practices in Corporate Governance as spelt out in the

M alay sian Code on Corporate Governance (the “ Code” ) and the L isting R eq uirements of Bursa M alay sia S ecurities Berhad

( ” Bursa S ecurities” ) during the financial y ear ended 3 1 Decemb er 2 0 0 8 .

1. BOARD OF DIRECTORS

1.1

1.2

1.3

P r i n c i p a l Re s p o n s i b i l i t i e s

The Board has overall stewarship of the Group; the Directors are ultimately resposib le for providing strateg ic

leadership; overseeing the b usiness conduct, identification and manag ement of principal risk s and ensuring the

adeq uacy and integ rity of internal control sy stems.

The Board has deleg ated specific responsib ilities to three (3 ) committees namely the A udit Committee,

N omination Committee and the R emuneration Committee. These three (3 ) Committees discharg e the duties

and responsib ilities in accordance with their respective Terms of R eference. The actual decision lies with the Board

after considering recommendations from the respective committees.

Co m p o s i t i o n

The Board comprises of nine (9 ) directors of whom four ( 4 ) of the Board memb ers are Independent N on- E x ecutive

Directors, a list of the entire Board is found on pag e 3 of this A nnual R eport while their respective profiles is set out

on pag es 5 to 9 of this A nnual R eport.

The Board is assisted b y a competent manag ement team to run the Group coached and mentored b y the

E x ecutive Chairman.

The Independent N on- E x ecutive Directors serve to b ring an element of check and b alance to the Board and are

crucial in providing ob jective, independent views, advice and judg ement to the Board in the interest of

shareholders and stak eholders.

The Board considers that its composition of Directors with a diverse mix of sk ills and ex perience in b usiness,

corporate, finance and law, b ring s to the Board not only essential commercial sk ills needed for sound investment

decisions b ut also invaluab le practical and operational ex perience to professionally manag e the Group.

Bo a r d M e e t i n g s a n d Su p p l y o f In f o r m a t i o n

The Board meets at least once every q uarter upon finalisation of the the results of each financial q uarter to

facilitate the review and approval of that q uarter’s financial results. Board meeting s are usually scheduled three (3 )

months in advance to enab le Directors to plan ahead and additional ad-hoc meeting s would b e called if needed.

During the financial y ear ended 3 1 Decemb er 2 0 0 8 , a total of four ( 4 ) meeting s were held and the record of each

Director’s attendance is as follows:-

Dir e c t o r s At t e n d a n c e

S aw E ng Guan 4 of 4

Terk Y ew Tee 4 of 4

Tuan H aji A z har Bin N ay an 4 of 4

Dato’ H aji Z ainal R ahim Bin Dato’ H aji Darus 4 of 4

K amaruddin Bin K osk ani A b dul H amid 4 of 4

Tan S ri Dato’ Dr. S y ed J alaludin b in S y ed S alim 2 of 4

Goh Choon H ock 3 of 4

Tan Chuan Y ong 4 of 4

N g S iew Thong 4 of 4


CORP ORATE G OV ERN AN CE STATEM EN T

1. BOARD OF DIRECTORS (cont’d)

1.3

1.4

1.5

Bo a r d M e e t i n g s a n d Su p p l y o f In f o r m a t i o n (cont’d)

The agenda and full set of Board papers containing pertinent information on matters to be deliberated are submit-

ted to the D irectors about a w eek prior to the meeting to prov ide them w ith sufficient time to ev aluate the matters

to be discussed and to enable a more informed decision-mak ing process.

The Board has full access to the senior management including the C ompany S ecretaries for assistance and

information on the C ompany ’s affairs and w here necessary , the adv ice of independent professionals.

D uring Board meetings, the C ompany S ecretaries in attendance are req uired to ensure that Board proceedings are

adhered to at all times. O ne of their responsibilities is to adv ise and update the D irectors on matters relating to

corporate gov ernance issues and directors’ responsibilities to ensure compliance w ith the relev ant legislations and

regulations.

Re - e l e c t i o n

In accordance w ith the A rticles of A ssociation of the C ompany , one-third (1 / 3 ) of the D irectors for the time being

or if their number is not a multiple of three (3 ) , then the number nearest to one-third (1 / 3 ) , shall retire from office

at each A nnual G eneral M eeting (” A G M ” ) . A ll retiring D irectors can offer themselv es for re-election.

D irectors appointed by the Board during the financial period before an A G M are subject to retirement and shall be

eligible for re-election by the shareholders at the C ompany ’s nex t A G M to be held follow ing their appointments.

The A rticles also prov ide that all directors including the M anaging D irector, if any , shall retire from office at least

once ev ery three (3 ) y ears but they shall be eligible for re-election.

D etails of D irectors seek ing for re-election at the F ifth A G M are disclosed in the S tatement A ccompany ing N otice

of A G M on page 8 2 of this A nnual R eport.

Dir e c t o r s ’ Tr a i n i n g

Bursa S ecurities has placed the onus to identify seminars suitable to the D irectors’ needs on the Board.

The D irectors are encouraged to regularly undergo training to k eep abreast of the latest changes and to w iden

their k now ledge. The training attended by each D irector during the financial y ear is set out in their respectiv e

profile on pages 5 to 9 of this A nnual R eport.


CORP ORATE G OV ERN AN CE STATEM EN T (cont’d)


CORPORATE GOVERNANCE STATEMENT (cont’d)

1 . B OARD OF D IRECTORS (cont’d)

1 .6 D i r e c t o r s ’ Re m u n e r a t i o n

A g g r e g a te D ir e ctor s ’ R e m u ne r a tion for th e f ina ncia l y e a r e nde d 3 1 D e ce m b e r 2 0 0 8 is a s follow :-

2 .1

2 . COMMITTEES OF TH E B OARD

T h e th r e e (3 ) C om m itte e s s e t u p to a s s is t th e B oa r d h a v e s p e cif ic p ow e r s a nd r e s p ons ib ilitie s . T h e C h a ir m a n of th e r e s p e c-

tiv e com m itte e r e p or ts th e ou tcom e of de cis ions a nd r e com m e nda tions to th e B oa r d a nd m inu te s of com m itte e m e e ting s

w ou ld b e ta b le d for th e B oa r d’s nota tion.

N otw ith s ta nding r e com m e nda tions f r om th e com m itte e s , th e u ltim a te de cis ion on a ll m a tte r s lie s w ith th e e ntir e B oa r d.

No m i n a t i o n Co m m i t t e e

T h e r ole of th e N om ina tion C om m itte e is to r e com m e nd s u ita b le ca ndida te s for a p p ointm e nt to th e B oa r d. T h e

C om m itte e is r e q u ir e d to e v a lu a te th e e f f e ctiv e ne s s of th e B oa r d a s a w h ole , th e v a r iou s com m itte e s of th e B oa r d

a nd to a s s e s s th e contr ib u tion of e a ch indiv idu a l dir e ctor to th e e f f e ctiv e ne s s of th e B oa r d’s de cis ion-m a k ing

p r oce s s on a n a nnu a l b a s is .

T h e N om ina tion C om m itte e com p r is e s of th e follow ing D ir e ctor s :

T a n S r i D a to’ D r. S y e d J a la lu din B in S y e d S a lim (C h a ir m a n, Inde p e nde nt N on- E x e cu tiv e D ir e ctor )

T a n C h u a n Y ong (Inde p e nde nt N on- E x e cu tiv e D ir e ctor )

G oh C h oon H ock (Inde p e nde nt N on- E x e cu tiv e D ir e ctor )

N g S ie w T h ong (Inde p e nde nt N on- E x e cu tiv e D ir e ctor )

D u r ing th e f ina ncia l y e a r e nde d 3 1 D e ce m b e r 2 0 0 8 , th e N om ina tion C om m itte e h a d one (1) m e e ting .

T h e D ir e ctor s ’ r e m u ne r a tion for th e f ina ncia l y e a r e nde d 3 1 D e ce m b e r 2 0 0 8 f a lls w ith in th e follow ing b a nds :-

Ca t e g o r y

E x e cu tiv e D ir e ctor s

N on-E x e cu tiv e D ir e ctor s

T ota l

Fe e s

RM

4 1,50 0

13 8 ,0 0 0

17 9 ,50 0

Sa la r i e s

RM

6 2 4 ,0 0 0

-

6 2 4 ,0 0 0

Ot h e r

Re m u n e r a t i o n

RM

7 4 ,8 8 0

-

7 4 ,8 8 0

B e n e f i t s -

i n - k i n d

RM

2 7 ,0 17

-

2 7 ,0 17

To t a l

RM

7 6 7 ,3 9 7

13 8 ,0 0 0

9 0 5,3 9 7

T h e a g g r e g a te a nnu a l D ir e ctor s ’ f e e s a r e a p p r ov e d b y s h a r e h olde r s a t th e A G M of th e C om p a ny b a s e d on th e

B oa r d’s r e com m e nda tions . It is th e p r a ctice for th e D ir e ctor s conce r ne d to a b s ta in f r om de lib e r a ting th e ir

indiv idu a l r e m u ne r a tion.

Ra n g e o f Re m u n e r a t i o n

B e low R M 50 ,0 0 0

R M 50 ,0 0 1 - R M 10 0 ,0 0 0

R M 150 ,0 0 1 - R M 2 0 0 ,0 0 0

R M 3 50 ,0 0 1 - R M 4 0 0 ,0 0 0

Ex e c u t i v e

-

-

1

1

No n Ex e c u t i v e

5

1

-

-

No o f D i r e c t o r



2 . COMMITTEE OF TH E B OARD (cont’d)

2.2 R e m u n e r a t i o n C o m m i t t e e

The Remuneration Committee is responsible for drawing up policy framework and to make recommendations to

the B oard on the remuneration packages of the E x ecutiv e D irectors of the Company. The E x ecutiv e D irectors do

not participate in decisions relating to their remuneration.

The B oard as a whole determines the remuneration of the N on- E x ecutiv e D irectors with the D irectors concerned

abstaining from participating in decisions in respect of their indiv idual remuneration.

The Remuneration Committee comprises of the following D irectors:

Tan S ri D ato’ D r. S yed J alaludin B in S yed S alim (Chairman, Independent Non-Executive Director)

Tan Chuan Y ong (Independent Non-Executive Director)

G oh Choon H ock (Independent Non-Executive Director)

N g S iew Thong (Independent Non-Executive Director)

S aw E ng G uan (Executive Chairman)

3 . S H A R E H O L D E R S

3 .1

3 .2

S h a r e h o l d e r s ’ C o m m u n i c a t i o n a n d I n v e s t o r R e l a t i o n

The Company is committed to maintaining good commnunications with its shareholders and stakeholders alike. In

this respect, information on the G roup’s financial performance and/ or major dev elopment is disseminated to the

public as soon as practicable v ia appropriate channels of communication chief of which is the B ursa L IN K prov ided

by B ursa S ecurities.

The A G M and E x traordinary G eneral M eeting (” E G M ” ) of the Company are the primary forum of interaction with

its priv ate and institutional inv estors. D uring such shareholders‘ meetings, the E x ecutiv e D irectors and other B oard

members as well as the A uditors of the Company would be at hand to address any q uestions that might be raised

by the shareholders. S tatus of all resolutions proposed at shareholders’ meetings would be released to the B ursa

S ecurities on that day itself.

O ther mode of information channels are the Company’s A nnual Reports and relev ant circulars, press releases and

press conferences, if any, the q uarterly financial results and the v arious disclosures and announcements to B ursa

S ecurities in compliance with the L isting Req uirements.

A n n u a l G e n e r a l M e e t i n g ( “ A G M ” )

The forthcoming F ifth A G M would prov ide the Company’s shareholders with an av enue to raise any q ueries that

they may hav e on the Company and the G roup. E ach item of special business set out in the notice of A G M is

accompanied with an ex planatory statement in respect of the resolutions proposed and where relev ant, Circular to

S hareholders setting out the relev ant information would be submitted to the shareholders at least twenty-one

( 2 1 ) days prior to the meeting.

2.3 A u d i t C o m m i t t e e

The main purpose of the A udit Committee is to assist the B oard in fulfilling its responsibilities relating to

accounting and reporting practices of the G roup.

The report of the A udit Committee, its terms and references and the list of committee members are set out on

pages 2 0 to 2 3 of this A nnual Report.



4 . ACCOU NTAB I L ITY AND AU D IT

4 .1

4 .2

4 .3

F i n a n c i a l Re p o r t i n g

T h e B oa r d cons ide r s th a t it h a s p r ov ide d a b a la nce d, f a ir a nd r e p r e s e nta tiv e a s s e s s m e nt of th e C om p a ny ’s a nd th e

G r ou p ’s b u s ine s s in its q u a r te r ly r e s u lts a nd a nnu a l f ina ncia l s ta te m e nts .

T h e f ina ncia l s ta te m e nts of th e C om p a ny a nd th e G r ou p for th e f ina ncia l y e a r e nde d 3 1 D e ce m b e r 2 0 0 8 a r e s e t ou t

on p a g e s 3 0 to 7 2 of th is A nnu a l R e p or t.

A s ta te m e nt b y th e B oa r d of its r e s p ons ib ilitie s in p r e p a r ing th e f ina ncia l s ta te m e nts is s e t ou t on p a g e 2 4 of th is

A nnu a l R e p or t.

I n t e r n a l Co n t r o l a n d Ris k Ma n a g e m e n t

T h e B oa r d h a s ov e r a ll r e s p ons ib ility for m a inta ining a s ou nd s y s te m of inte r na l contr ols to s a f e g u a r d s h a r e h olde r s ’

inv e s tm e nts a nd th e C om p a ny ’s a s s e ts .

It m u s t b e note d th a t w h ile th e inte r na l contr ol s y s te m is de v is e d to ca te r for th e p a r ticu la r ne e ds of th e G r ou p a s

w e ll a s r is k m a na g e m e nt, s u ch contr ols b y th e ir na tu r e ca n only p r ov ide r e a s ona b le a s s u r a nce b u t not a ds olu te

a s s u r a nce a g a ins t m a te r ia l m is s ta te m e nt, los s or f r a u d. A s ta te m e nt on th e inte r na l contr ol w ith in th e G r ou p is s e t

ou t on p a g e 1 9 of th is A nnu a l R e p or t.

Re la t i o n s h i p w i t h Au d i t o r s

T h e B oa r d m a inta ins a for m a l, ob je ctiv e , p r ofe s s iona l a nd tr a ns p a r e nt r e la tions h ip w ith its a u ditor s , b oth inte r na l

a nd e x te r na l.

T h e r ole of th e A u dit C om m itte e in r e la tion to th e E x te r na l A u ditor s is s e t ou t on th e R e p or t of th e A u dit C om m itte e

on p a g e s 2 0 to 2 3 of th is A nnu a l R e p or t.

5 . AD D ITIONAL COMPL IANCE INF ORMATION

U t i l i s a t i o n o f Pr o c e e d s

T h e r e w e r e no p r oce e ds r a is e d b y th e C om p a ny f r om a ny cor p or a te p r op os a ls du r ing th e f ina ncia l y e a r.

Sh a r e s B u y - B a c k s

T h e s h a r e h olde r s h a d a t th e F ou r th A G M of th e C om p a ny h e ld on 2 7 J u ne 2 0 0 8 r e ne w e d th e a u th or ity for th e C om p a ny

to p u r ch a s e u p to te n p e r ce nt (1 0 % ) of its ow n s h a r e s .

S ince th e C om p a ny ’s f ir s t s h a r e b u y - b a ck on 5 J a nu a r y 2 0 0 6 till 1 8 M a y 2 0 0 9 , th e C om p a ny h a d b ou g h t- b a ck a tota l of

2 ,1 2 6 ,6 0 0 of its ow n s h a r e s f r om th e B u r s a S e cu r itie s a t a tota l cons ide r a tion of R M 9 0 7 ,7 3 6 .6 4 , a ll of w h ich a r e k e p t a s

tr e a s u r y s h a r e s a nd none h a v e b e e n r e s old nor ca nce lle d.



5 . AD D ITIONAL COMPL IANCE INF ORMATION (cont’d)

Sh a r e s B u y - B a c k s (cont’d)

D u r ing th e f ina ncia l y e a r e nde d 3 1 D e ce m b e r 2 0 0 8 , a tota l of 4 8 9 ,7 0 0 T A F I s h a r e s a t a cos t of R M 1 8 5 ,1 5 4 .1 1 h a d b e e n

b ou g h t b a ck b y th e C om p a ny a nd th e m onth ly b r e a k dow n of s h a r e s b ou g h t- b a ck a r e a s follow s :-

Op t i o n s , W a r r a n t s o r Co n v e r t i b l e Se c u r i t i e s

T h e C om p a ny h a s not is s u e d a ny op tions , w a r r a nts nor conv e r tib le s e cu r itie s du r ing th e f ina ncia l y e a r e nde d 3 1

D e ce m b e r 2 0 0 8 .

Am e r i c a n D e p o s i t o r y Re c e i p t ( “ AD R” ) o r Glo b a l D e p o s i t o r y Re c e i p t ( “ GD R” )

T h e C om p a ny h a s not s p ons or e d a ny A D R or G D R p r og r a m m e for th e f ina ncia l y e a r e nde d 3 1 D e ce m b e r 2 0 0 8 .

Sa n c t i o n s a n d / o r Pe n a l t i e s

T h e C om p a ny a nd its s u b s idia r ie s , D ir e ctor s a nd M a na g e m e nt h a v e not b e e n im p os e d w ith a ny s a nctions a nd/ or p e na ltie s

b y a ny r e g u la tor y b odie s du r ing th e f ina ncia l y e a r e nde d 3 1 D e ce m b e r 2 0 0 8 .

No n - Au d i t F e e s

T h e r e w e r e no non- a u dit f e e s p a id or p a y a b le to th e e x te r na l a u ditor s du r ing th e f ina ncia l y e a r e nde d 3 1 D e ce m b e r

2 0 0 8 .

Va r i a t i o n i n Re s u l t s

T h e r e w a s no p r of it for e ca s t is s u e d b y th e C om p a ny a nd its s u b s idia r y com p a nie s du r ing th e f ina ncia l y e a r e nde d 3 1

D e ce m b e r 2 0 0 8 .

Mo n t h l y

B r e a k d o w n

J a nu a r y 2 0 0 8

F e b r u a r y 2 0 0 8

M a r ch 2 0 0 8

A p r il 2 0 0 8

M a y 2 0 0 8

J u ne 2 0 0 8

J u ly 2 0 0 8

A u g u s t 2 0 0 8

S e p te m b e r 2 0 0 8

O ctob e r 2 0 0 8

N ov e m b e r 2 0 0 8

D e ce m b e r 2 0 0 8

To t a l

No . o f TAF I

Sh a r e s

b o u g h t - b a c k

a n d r e t a i n e d

a s Tr e a s u r y

Sh a r e s

6 2 ,1 0 0

5 7 ,0 0 0

N il

N il

1 6 ,0 0 0

5 6 ,0 0 0

2 8 ,5 0 0

6 8 ,1 0 0

2 5 ,0 0 0

N il

5 ,0 0 0

1 7 2 ,0 0 0

4 8 9 ,7 0 0

L o w e s t

0 .3 9 0

0 .4 0 0

N / A

N / A

0 .4 0 0

0 .3 8 0

0 .3 8 0

0 .4 0 0

0 .4 0 0

N / A

0 .4 3 0

0 .3 0 0

H i g h e s t

0 .4 3 0

0 .4 1 0

N / A

N / A

0 .4 5 0

0 .4 3 5

0 .4 2 0

0 .4 0 0

0 .4 0 0

N / A

0 .4 3 0

0 .3 6 0

Av e r a g e

c o s t p e r

TAF I Sh a r e

( i n c l u d e s

b r o k e r a g e

f e e s )

( RM)

0 .4 1 7

0 .4 0 8 9

N / A

N / A

0 .4 2 1 9

0 .4 0 2 5

0 .4 1 0 9

0 .4 0 6 3

0 .4 0 8 6

N / A

0 .4 3 8 7

0 .3 1 9

To t a l Co s t

( RM)

2 5 ,8 9 7 .0 2

2 3 ,3 0 9 .2 2

N / A

N / A

6 ,7 5 0 .0 0

2 2 ,5 4 2 .7 5

1 1 ,7 0 9 .4 1

2 7 ,6 6 9 .1 8

1 0 ,2 1 6 .0 0

N / A

2 ,1 9 3 .6 5

5 4 ,8 6 6 .8 8

1 8 5 ,1 5 4 .1 1

B u y - B a c k Pr i c e p e r TAF I

Sh a r e ( RM)



w h ich ev er is th e low er.

In v iew of th is p r ov is ion, no s h a r eh older s ’ m a nda te on R R P T w a s s ou g h t in 2 0 0 8 . S im ila r ly , th e B oa r d decided not to ob ta in

s h a r eh older s ’ m a nda te for R R P T in 2 0 0 9 . N oneth eles s , th e B oa r d th r ou g h th e A u dit C om m ittee a nd th e m a na g em ent w ill

continu e to r ev iew a nd m onitor th e s ta tu s of R R P T in ev er y q u a r ter to ens u r e com p lia nce w ith th e L is ting R eq u ir em ents .

Co r p o r a t e So c i a l Re s p o n s i b i l i t y ( ” CSR” )

T o th e T A F I G r ou p , C S R is not ju s t h ow m u ch th e G r ou p “ g iv es b a ck ” to s ociety b u t th e m a nner in w h ich T A F I op er a tes its

b u s ines s es to g ener a te r ev enu e a nd u tilis e its p r of its w h ils t cons ider ing th e inter es ts of s ociety b y ta k ing r es p ons ib ility for

th e im p a ct of its a ctiv ities on s ta k eh older s , i.e. th e cu s tom er s , s u p p lier s , em p loy ees , s h a r eh older s , com m u nities a nd th e

env ir onm ent.

Incor p or a ting elem ents of C S R into ev er y a s p ect of th e G r ou p ’s op er a tions h a v e b een a n ong oing a f f a ir a nd for th e y ea r

2 0 0 8 , th er e w er e no p a r ticu la r ly s ig nif ica nt C S R a ctiv ities s a v e for im p lem enting im p r ov em ents to th e w elf a r e a nd w ell

b eing of its s ta f f for ce a s a nd w h en needed a nd g ener a lly , ta k ing cons ciou s ef for ts to m inim is e s tr es s a nd h a r m to th e

env ir onm ent.

T h e G r ou p w a s a ccr edited w ith th e F S C (F or es t S tew a r ds h ip C ou ncil) C er tif ica tion on 2 3 J u ne 2 0 0 8 . T h e F S C p r om otes

r es p ons ib le m a na g em ent of th e w or ld’s for es ts a nd its cer tif ica tion is a n endor s em ent th a t th e G r ou p p r odu ction

p r oces s es p la y ed a r ole in s u s ta ina b le for es tr y .

B es ides th e a b ov e, oth er C S R a ctiv ities u nder ta k en b y th e G r ou p inclu des ens u r ing th e r e-cy cling of w a s tes w h enev er

p os s ib le to r edu ce a nd m inim is e s tr es s to th e env ir onm ent, dona tion- in-ca s h a nd in- k ind to v a r iou s ch a r ita b le

or g a nis a tions a nd th e p la nting of tr ees a t th e f a ctor y p r em ies .

(i)

(ii)

th e cons ider a tion, v a lu e of th e a s s ets , ca p ita l ou tla y or cos ts of th e R ecu r r ent T r a ns a ction is eq u a l to or ex ceeds

R M 1 m illion; or

th e p er centa g e r a tio of s u ch R ecu r r ent T r a ns a ction is eq u a l to or ex ceeds 1 %

5 . AD D ITIONAL COMPL IANCE INF ORMATION (cont’d)

Pr o f i t Gu a r a n t e e

T h er e w a s no p r ofit g u a r a ntee g iv en b y th e C om p a ny du r ing th e f ina ncia l y ea r ended 3 1 D ecem b er 2 0 0 8 .

Ma t e r i a l Co n t r a c t s

T h er e w er e no m a ter ia l contr a cts (not b eing contr a cts enter ed into in th e or dina r y cou r s e of b u s ines s ) enter ed into b y th e

C om p a ny a nd its s u b s idia r ies inv olv ing th e inter es ts of dir ector s a nd s u b s ta ntia l s h a r eh older s of th e C om p a ny eith er

s u b s is ting a t th e end of th e f ina ncia l y ea r or enter ed into s ince th e end of th e p r ev iou s f ina ncia l y ea r.

Re v a l u a t i o n Po l i c y

T h e G r ou p h a s not a dop ted a r eg u la r r ev a lu a tion p olicy on its la nded p r op er ties a nd w ou ld only do s o if th e need a r is es .

T h e ex is ting s y s tem of s h ow ing th e a s s ets a t cos t les s a ccu m u la ted dep r ecia tion, a s dis clos ed in N ote 3 of th e F ina ncia l

S ta tem ents , is a g ener a lly a ccep ted a ccou nting p r a ctis e a s w ell a s a cos t- s a v ing m ea s u r e.

Re c u r r e n t Re l a t e d Pa r t y Tr a n s a c t i o n s ( ” RRPT” )

S a v e a s dis clos ed in N ote 2 0 of th e F ina ncia l S ta tem ents , th er e a r e no ex is ting a nd p r op os ed r ela ted p a r ty tr a ns a ctions a nd

conflict of inter es t in r ela tion to th e T A F I G r ou p a nd its p r om oter s , s u b s ta ntia l s h a r eh older s a nd dir ector s .

T h e L is ting R eq u ir em ents of B u r s a M a la y s ia S ecu r ities B er h a d p r ov ides th a t a lis ted is s u er w ith a n is s u ed a nd p a id- u p

ca p ita l w h ich is les s th a n R M 6 0 m illion is r eq u ir ed to m a k e a n im m edia te a nnou ncem ent in r es p ect of R R P T w h er e:


INTERNAL CONTROL STATEMENT


AUDIT COMMITTEE REPORT

1 . MEMB ERS

2 . MEETIN G S

Following the resignation of Mr. Saw Eng Guan as a member of the Audit Committee on 21 November 2008, the

Audit Committee c omp rised of three (3 ) members of the B oard as follows:-

- Goh Choon H oc k (Chairman) (Ind e p e nd e nt N o n- E x e c u t iv e D ire c t o r)

- T an Chuan Y ong (M e mb e r) (Ind e p e nd e nt N o n- E x e c u t iv e D ire c t o r)

- Ng Siew T hong (M e mb e r) (Ind e p e nd e nt N o n- E x e c u t iv e D ire c t o r)

D uring the financ ial y ear ended 3 1 D ec ember 2008, the Audit Committee held a total of four ( 4 ) meetings, details of

attendanc es of the Committee members are as follows:-

Me m b e r s At t e n d a n c e

Goh Choon H oc k (Chairman) 3 of 4

T an Chuan Y ong 4 of 4

Ng Siew T hong 4 of 4

Saw Eng Guan (R e s ig ne d as a me mb e r o n 2 1 N o v e mb e r 2 0 0 8 ) 4 of 4

3 . IN TERN AL AUDIT F UN CTION

T he internal audit dep artment p lay s a k ey role in undertak ing indep endent, regular and sy stematic reviews of risk

management, internal c ontrol and governanc e sy stems to p rovide the Group with reasonable assuranc e that the said

sy stems are op erating and will c ontinue to op erate satisfac torily and effec tively .

It is the resp onsibility of the internal audit team to p rovide the Audit Committee with indep endent and objec tive rep orts

on the state of the risk management, c ontrol and governanc e p roc esses p ertaining to the various op erating units within

the Group and the ex tent of their c omp lianc e with the Group ’s established p olic ies, p roc edures and relevant statutory

req uirements.

B esides the Comp any Sec retaries, head of the Comp any ’s financ e dep artment, the internal auditor and a staff of Mac ellent

(Muar) Sdn. B hd. attended all Committee meetings on the invitation of Chairman of the Committee.

a.

b.

c .

4 . TERMS OF REF EREN CE

4 .1 Co m p o s i t i o n o f t h e Au d i t Co m m i t t e e

T he Audit Committee shall be ap p ointed by the B oard from amongst its numbers and must fulfil the following

req uirements:

T he Committee must c omp ose of no fewer than three (3 ) members.

Must be non-ex ec utive direc tors with a majority of them being indep endent direc tors.

At least one (1) member of the Audit Committee:-

( i) must be a member of the Malay sian Institute of Ac c ountants ( ” MIA” ); or

(ii) if he is not a member of the MIA, he must have at least three (3 ) y ears work ing ex p erienc e and:-

(iii) fulfils suc h other req uirements as p resc ribed or ap p roved by the Ex c hange.

(aa) he must have p assed the ex aminations sp ec ified in P art I of the 1st Sc hedule of the Ac c ountants Ac t 19 6 7 ,

or

(bb) he must be a member of one of the assoc iations of ac c ountants sp ec ified in P art II of the 1st Sc hedule of

the Ac c ountants Ac t 19 6 7 ; or

ta annual report 2008 - tafi industries berhad to page 20 (2.1mb).pdfte r k ye w te e was appointed...

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