INSAS-AnnualReport2009 (374KB)

laporan tahunan annual report 2009

I N S A S B E R H A D 1

3 Corporate Information

4 Profile of Directors

6 Chief Executive Officer’s Statement

8 Statement on Corporate Governance

12 Statement on Internal Control

14 Audit Committee Report

16 Five Years Group Financial Highlights

17 Financial Statements

81 List of Properties

82 Analysis of Shareholdings

84 Statement of Directors’ Interest in the Companyand its Related Corporations

85 Notice of Annual General Meeting

87 Statement Accompanying Notice of the 47th AnnualGeneral Meeting

88 Statement in Relation to the Proposed Renewalof Authority to Purchase its Own Sharesby the Company

Proxy Form

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contents

INSAS

2 I N S A S B E R H A D

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INSAS


COMPANY SECRETARIES

Chow Yuet KuenYau Jye Yee

REGISTERED OFFICE

No. 45-5, The Boulevard, Mid Valley City,Lingkaran Syed Putra, 59200 Kuala LumpurTel : 03-22848311 Fax: 03-22824688

PRINCIPAL PLACE OF BUSINESS

Suite 23.02, Level 23,The Gardens South Tower,Mid Valley City,Lingkaran Syed Putra, 59200 Kuala LumpurTel : 03-22829311 Fax: 03-22848500

(*) - Independent Non-Executive Directors

BOARD OF DIRECTORS

Chairperson* Y.A.M. Tengku Puteri Seri Kemala Pahang Tengku

Hajjah Aishah bte Sultan Haji Ahmad Shah, DK(II), SIMP

Executive Deputy Chairman / Chief Executive Officer Dato’ Thong Kok Khee

Executive DirectorDr Tan Seng Chuan

Non-Executive DirectorsDato’ Wong Gian Kui Soon Li Yen

* Oh Seong Lye

PRINCIPAL BANKERS

Affin Investment Bank BerhadCredit Suisse, SingaporeCitibank, N.A.EON Bank BerhadHong Leong Bank BerhadMalayan Banking BerhadOCBC Bank (Malaysia) BerhadPublic Bank BerhadRHB Bank BerhadSociete Generale Bank & Trust Singapore

SOLICITORS

R ThayalanRaslan LoongShearn Delamore & Co.Tee Bee Kim & Partners

SHARE REGISTRARS

Megapolitan Management Services Sdn. Bhd.No. 45-5, The Boulevard, Mid Valley City,Lingkaran Syed Putra, 59200 Kuala LumpurTel : 03 - 22848311 Fax: 03 - 22824688

STOCK EXCHANGE LISTING

Bursa Malaysia Securities Berhad, Main Board

SECTOR

Finance

STOCK CODE

3379

AUDIT COMMITTEE

* Y.A.M. Tengku Puteri Seri Kemala Pahang Tengku Hajjah Aishah bte Sultan HajiAhmad Shah, DK(II), SIMPSoon Li Yen

* Oh Seong Lye

AUDITORS

SJ Grant Thornton (AF 0737)(Member of Grant Thornton International)Chartered AccountantsLevel 11, Faber Imperial CourtJalan Sultan Ismail50250 Kuala Lumpur

Corporate Information

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INSAS


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Y.A.M. TENGKU PUTERI SERI KEMALA PAHANG

TENGKU HAJJAH AISHAH BTE SULTAN HAJI AHMAD SHAH, DK(II), SIMP

Aged 52, is a Malaysian citizen and an Independent Non-Executive Director. She was appointed as the

Chairperson of Insas on 12 November 1986. She has a Diploma in Business Administration from Dorset Institute,

United Kingdom and has been a Director of TAS Industries Sdn Bhd since 15 August 1990. TAS Industries Sdn

Bhd is an investment holding and property development company in Kuala Lumpur. She has no family relationship

with any Director/major shareholder of Insas and has no conflict of interest with Insas. She has not been

convicted for any offences within the past 10 years.

DATO’ THONG KOK KHEE

Aged 55, is a Malaysian citizen and the Executive Deputy Chairman cum Chief Executive Officer. He was

reappointed to the Board of Insas on 28 February 2007 and subsequently appointed as the Chief Executive

Officer of Insas on 30 January 2009. Dato’ Thong was an Executive Director and Chief Executive Officer of Insas

from 10 March 1993 until 29 November 2004. A graduate from the London School of Economics, Dato’ Thong had

worked in the financial services industry since 1979. He was an Executive Director of Standard Chartered

Merchant Bank Asia in Singapore and Head of its corporate finance division. He is a substantial shareholder of

Insas. He has no conflict of interest with Insas and has not been convicted for any offences within the past 10

years.

DATO’ WONG GIAN KUI

Aged 50, is a Malaysian citizen and a Non-Executive Director. He was appointed to the Board of Insas on 11

September 1992. He was later appointed as Managing Director on 30 November 2000 and subsequently became

the Chief Executive Officer/Group Managing Director on 29 November 2004. He was redesignated from Chief

Executive Officer/Group Managing Director to Non-Independent & Non-Executive Director of Insas on 30 January

2009. He is an accountant by profession and has been a member of the Malaysian Institute of Accountants since

1988 and of the Malaysian Institute of Certified Public Accountants since 1985. Prior to joining Insas, Dato’ Wong

worked for Harun, Oh & Wong, a member of Horwath International firm of public accountants in Malaysia from

1981 to 1990 and Stoy Hayward London, Chartered Accountants from 1990-1991. He has no family relationship

with any Director/major shareholder of Insas and has no conflict of interest with Insas. He has not been convicted

for any offences within the past 10 years.

Profile of Directors


INSASDR TAN SENG CHUAN

Aged 54, is a Malaysian citizen and an Executive Director. Dr Tan was appointed to the Board of Insas on 18

March 1997. He graduated with First Class Honours in Mechanical Engineering from Imperial College, England

in 1978. Dr Tan obtained his Masters and Ph.D in Engineering Science in 1981 and 1983 respectively from

Harvard University, USA. Dr Tan has very wide experience in the information technology (IT) industry. He has

worked on leading edge software and hardware product development with many companies in the global IT

industry. He has no family relationship with any Director/major shareholder of Insas and has no conflict of interest

with Insas. He has not been convicted for any offences within the past 10 years.

MR OH SEONG LYE

Aged 61, is a Malaysian citizen and an Independent Non-Executive Director. He was appointed to the Board of

Insas on 18 March 2009. Mr Oh is a London-trained Chartered Accountant. He is a Fellow of the Institute of

Chartered Accountants in England and Wales, a member of the Malaysian of Institute Accountants and a member

of the Institute of Certified Public Accountants of Singapore. He holds a Master of Business Administration degree

from United Business Institutes, a Brussels-based business school. After a year of post-qualifying experience in

London, he worked for a “big-four” accounting firm and a foreign bank in Kuala Lumpur before starting his

accounting practice in 1978 and has been in public practice ever since. He was the executive chairman and

international liaison partner when his firm was a member of Horwath International until 1992. His firm was the

external auditors and tax agents for two major banks, several other financial institutions and insurance companies

and other substantial private enterprises. He had also personally undertaken large receivership and liquidation

assignments, and conducted, together with foreign partners, market and financial feasibility studies for several

organizations involved in the hospitality business and tourism industry. He was previously a director of two Bursa

Malaysia Public Listed Companies and was also the founder/promoter and first Honorary Secretary of a national

manufacturing association and a past Hononary Secretary-General of a national tourism-related association. He

has no family relationship with any Director/major shareholder of Insas and has no conflict of interest with Insas.

He has not been convicted for any offences within the past 10 years.

MS SOON LI YEN

Aged 41, is a Malaysian citizen and a Non-Independent and Non-Executive Director. She was appointed to the

Board of Insas on 06 March 2009. She is an accountant by profession and prior to joining Insas in August 1995,

she worked for Coopers & Lybrand as Audit Senior from 1991 to 1995. Ms Soon graduated from the Royal

Melbourne Institute of Technology with a Bachelor of Business in Accounting in 1991. She is a member of

Malaysian Institute of Accountants and Certified Public Accountants of Australia and has extensive experience in

auditing, accounting, financial planning and financial related work. She has no family relationship with any

Director/major shareholder of Insas and has no conflict of interest with Insas. She has not been convicted for any

offences within the past 10 years.

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INSAS

To all Shareholders

During the 12 month period of our last financial year from

June 2008 to June 2009, the world economy experienced

one of the greatest financial crisis in modern history. Starting

from what is now popularly known as the sub-prime

mortgage crisis that began in the United States in early

2008, the financial crisis led to the collapse of Bear Sterns

and Lehman Brothers, two prominent investment banking

firms on Wall Street. In fact, the crisis became so severe

that by October 2008, the global financial system was at

great risk. Inter-bank lending came to a halt as international

banks lost faith in each other’s solvency. The banking

system in the United States and the United Kingdom

required massive government intervention through

emergency funding for troubled banks. In the month of

October 2008, history was made when the two most

prestigious investment banking firms on Wall Street,

Goldman Sachs and Morgan Stanley, sought government

funding. Merrill Lynch was taken over by Bank of America,

Citigroup was “nationalised” by the US government, as was

Lloyds and Royal Bank of Scotland in the United Kingdom.

From the peak of 14,164 points in October 2007, the Dow

Jones Industrial Index declined by 54% to a low of 6,547

points in March 2009. Across the globe, stock and commodity

markets collapse and businesses suffered a broad decline.

Against this volatile backdrop, and despite weak performance

from our retail and stock broking divisions, we managed to

increase our Group profits from MR20.8 million to MR57.1

million, up 174.5%. We also ended the year with a stronger

and more liquid balance sheet, partly resulting from the sale of

our investment in Gleneagles Hospital and partly because we

have been raising our cash levels before the crisis. The sale of

our hospital investment is timely as it is a mature asset with

limited earnings growth without substantial additional capital

investments in new hospital beds and medical equipment.

In terms of Group operations, our IT and project finance

divisions remained profitable in challenging circumstances.

Our stock broking firm and our retail associate, Melium

Group, incurred losses. Our property development division

results were flat. In the last quarter March to June 2009, we

took advantage of the depressed markets to increase our

investments across a broad class of assets. We also took

advantage of the decline in foreign currency exchange rates

with respect to the Ringgit to increase our holdings of foreign

currencies, in particular in the Australian Dollar. This has

worked out well as the Australian Dollar has since

appreciated significantly against the Ringgit. Consequently,

we ended the year in a relatively good position. Looking

ahead, we are quite optimistic.

In the current financial year, we have taken steps to

strengthen our stock broking firm. We have recruited an

experienced team of 4 senior personnel in corporate finance

and have obtained the necessary license from Bursa

Malaysia and the Securities Commission to carry out advisory

and submission work in corporate finance activities. We have

since been successful in securing a number of advisory


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Chief Executive Officer’s Statement

On behalf of the Board of Directors, I am pleased to present the Annual

Report and audited financial statements of Insas Berhad for the financial

year ended 30 June 2009.

mandates. This new source of fee-based income will broaden

our earnings base, increase our corporate client base and

generate new sources of broking revenue. The relaxation of

capital controls for foreign investments have also opened up

new opportunities for internet broking. We are tying up with

foreign broking firms to access their global internet platforms

to enable our clients to buy and sell foreign securities. This

will provide value added services to our clients and further

enhance our broking revenue.

In July this year, in conjunction with a UK property group

(Native Land Limited), we took an equal interest to

acquire a residential-cum commercial property in the

Belgravia area of London for a total consideration of

Stg22.5 million, equivalent to RM128.0 million. This

building comprises 29 apartments totaling 29,140 sq feet

and commercial space of 8,065 sq feet. We bought this

building close to the bottom of the London property

market this year and we believe that this investment

will do well eventually.

We are continuing to look for new investments that can

provide the Group with sustainable earnings in the

future.

Corporate Social Responsibility

Social and conservation priorities remain an integral part of

the Group’s operating policy regardless of the economic

environment. In the course of the last financial year, we

continue to support welfare and accommodation facilities to

certain religious and charitable organizations in the country.

To safeguard the environment and conserve resources, we

lead our employees to adopt environmentally friendly

practices in our daily operations such as recycling paper,

adopt the use of electronic mail and conserve energy at

workplace. The Group will continue its effort to discharge its

role as a responsible and caring corporate citizen.

Appreciation

On behalf of the Board of Directors, I wish to thank the

management and staff for their loyalty, dedication, support and

commitment in carrying out their duties over the past year.

I would also like to record my deepest appreciation to our

business associates and shareholders, customers, bankers

and the regulatory authorities for their continued support and

cooperation extended to the Group.

Lastly, to my fellow Board members, I wish to extend my

gratitude and appreciation for their confidence, loyalty,

patience and invaluable counsel to the Group.

Dato’ Thong Kok Khee

Executive Deputy Chairman / Chief Executive Officer


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Chantrey HouseBelgravia

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The Chief Executive Officer is responsible to the Boardfor the management and performance of the Group’sbusinesses within the framework of the Group’spolicies, reserved powers and routine reportingrequirements.

There is a clear division of responsibilities on thediffering roles of the Chairperson and the ExecutiveDirectors to ensure a balance of authority and power.The Chairperson heads the Board and is responsiblefor ensuring the Board meets regularly and ensure itseffectiveness and standards of conduct. She hasauthority over the general agenda for each Boardmeeting to ensure that all Directors are provided withrelevant information on a timely basis. The generalagenda may include minutes of prior meetings of theBoard, review of the Group’s period financial reports,proposal papers from the management, mattersrequiring the Board’s deliberation and approval andother reports. The Executive Directors take onprimary responsibility for managing the Group’sbusinesses and resources. They have overallresponsibility for the operational activities of theGroup and implementation of the Board’s strategies,policies and decisions.

The Board recognises the importance and contributionof its Independent Non-Executive Directors. TheIndependent Non-Executive Directors provideindependent assessment and judgment on corporateproposals undertaken by the Group. They fulfill a pivotalrole in bringing corporate accountability andindependent, unbiased judgment and advice to bear onthe Board’s deliberation and decision-making. The roleof Independent Non-Executive Directors is particularlyimportant in ensuring that the strategies proposed by theExecutive Directors and management team arediscussed and examined fully and to take into accountlong-term interest of all parties affected by the Group’sbusiness activities. The Independent Non-ExecutiveDirectors are independent of the management and themajor shareholders.

c) Board Meetings The Board has five scheduled meetings annually, withadditional meetings held as and when urgent issuesand important matters arise that are required to betaken between the scheduled meetings. There werefive Board meetings held during the financial yearended 30 June 2009. Four Board meetings were heldat The Boardroom, No. 45-3, The Boulevard, MidValley City, Lingkaran Syed Putra, 59200 KualaLumpur and one Board Meeting was held at TheBoardroom, Suite 23.02, Level 23, The Gardens SouthTower, Mid Valley City, Lingkaran Syed Putra, 59200Kuala Lumpur. The date and time of the Boardmeetings were as follows :-

Date of Meetings Time

27 August 2008 12.00 noon

17 October 2008 3.30 p.m.

26 November 2008 12.00 noon

26 February 2009 12.00 noon

29 May 2009 4.00 p.m.

INTRODUCTION

Corporate governance set out the framework and processwhich corporations, through their Board of Directors and seniormanagement, regulate their businesses activities. Theseprinciples aims to balance sound business operations withcompliance to relevant laws, guidelines and regulations.

The Board of Directors (“the Board”) of Insas Berhad is fullycommitted to maintaining the highest standards of corporategovernance throughout the Group. To this end, the Board hasadopted a set of Corporate Governance guidelines to governits conduct within the spirit of the Malaysian Code of CorporateGovernance (“the Code”) and the Bursa Malaysia SecuritiesBerhad’s Listing Requirements. The Board believes that highstandards of corporate governance is the key to building anorganisation of high integrity and corporate accountability withthe ultimate objective of enhancing long-term shareholdersvalue and returns to its stakeholders.

The Board is pleased to set out below the manner in which ithas applied the principles of corporate governance and theextent of compliance with the best practices set out in the Codethroughout the financial year and where there are deviations,the alternative measures undertaken pursuant to the BursaMalaysia Securities Berhad’s Listing Requirements.

BOARD OF DIRECTORS

a) Principal ResponsibilitiesThe Board has overall stewardship responsibility forsupervising the Group’s affairs within a framework ofacceptable risks and in compliance with the relevant laws,guidelines and regulations. The Board concentratesprincipally on financial performance, critical and materialbusiness issues and specific areas such as managementof risks, the Group’s system of internal controls,succession planning for senior management andinvestors and shareholders communication policies. TheBoard is also accountable for the corporate governance,setting strategic direction of the Group and overseeing theinvestments and businesses of the Group.

b) Composition The establishment of an active, dynamic and independentBoard is paramount in improving corporate governancepractices. The current Board composition provides aneffective combination of industry and professionalexperience, skills and expertise for the direction of theexisting businesses and new corporate venturesundertaken by the Group. The Board is made up of anappropriate balance of Executives and Non-ExecutiveDirectors with diverse experience required for the effectivestewardship of the Group and independence in decisionmaking at Board level.

The Board comprises six members, namely the ChiefExecutive Officer (cum Executive Deputy Chairman), anExecutive Director, two Non-Executive Directors and twoIndependent Non-Executive Directors including theChairperson. The current Board composition complieswith the Bursa Malaysia Securities Berhad’s ListingRequirements which requires a minimum of two directorsor one third of the Board to be independent members. Abrief profile of each of the directors is presented on page4 of the Annual Report.

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Statement on Corporate Governance

INSAS


Details of attendance of the Directors at the Board meetingsare as follows :-

YAM Tengku Puteri Seri Kemala Pahang Tengku Hajjah Aishah bte Sultan Haji Ahmad Shah, DK(II), SIMP 3/5 Dato’ Thong Kok Khee 5/5 Dato’ Wong Gian Kui 5/5 Dr Tan Seng Chuan 5/5 Dato’ Thong Kok Yoon 3/4 (resigned on 18 March 2009)Melwani Ashok Bhagwandas 2/4 (resigned on 6 March 2009)Cheong Eng Tick 2/5 (resigned on 29 May 2009) Michael Lim Hee Kiang 3/4 (resigned on 18 March 2009) Oh Seong Lye 1/1 (appointed on 18 March 2009)Soon Li Yen 1/1 (appointed on 6 March 2009)

d) Supply of Information The Board has full and timely access to informationconcerning the Group. An agenda and board reportscontaining information relevant to the business forconsideration at the meeting are circulated prior to the Boardmeetings to enable the Directors to obtain information andexplanation to enable them to discharge their duties andresponsibilities competently and in a well-informed manner.Senior management and key operation managers areinformed of the guidelines on the preparation of boardpapers, in particular on its contents and format, to ensure asystematic and comprehensive presentation of information atall times. The board papers and reports provide updates ofperiodical information on the Group’s financial performance,operational matters and corporate developments.

Board proceedings, deliberations and conclusions of theBoard at every Board meeting are duly recorded in the Boardminutes and all minutes are signed by the Chairperson of themeeting in compliance with Section 156 of the CompaniesAct, 1965. All Directors have the right and duty to makefurther enquiries whenever they consider it necessary.

The Board has access to the advice and services of theCompany Secretary and senior management employeesof the Group who are responsible to the Board forensuring that all Board procedures are followed and thatapplicable laws and regulations are complied with. TheBoard may also obtain independent professional advice atthe Company’s expense in furtherance of their duties.

The Board is also regularly updated and advised by theCompany Secretary of any corporate announcementreleased to Bursa Malaysia Securities Berhad, impendingrestriction in dealing with the securities of the Companyprior to the announcement of financial results andcorporate proposals and new regulations, guidelines ordirectives issued by the Bursa Malaysia SecuritiesBerhad, the Securities Commission and other relevantregulatory authorities.

e) Appointment and Re-election There is no Nomination Committee in the Group but theBoard has the service of the Company Secretary to ensurethat the appointments of new directors to the Board areproperly made with an established and transparentprocedure and in compliance with the rules of the relevantauthorities. Any appointment of additional director is madeas and when it is deemed necessary by the existing Boardwith due consideration given to the mix and range ofexpertise and experience required for an effective Board.

In accordance with the Company’s Articles of Association,all Directors who are appointed by the Board are subject tore-election by the shareholders at the following AnnualGeneral Meeting after their appointment. The Articles alsoprovide that the Directors are subject to re-election byrotation at least once in every three years. Reappointmentsare not automatic and the Directors who retire are tosubmit themselves for re-election by shareholders at theCompany’s Annual General Meeting.

Details of directors seeking re-election at the forthcomingannual general meeting are disclosed in the StatementAccompanying Notice of the Annual General Meeting.

f) Training and Continuing Board DevelopmentAll the Directors with the exception of Mr. Oh Seong Lyeand Ms. Soon Li Yen, who were appointed to the Boardduring the financial year, have attended and completedthe Mandatory Accreditation Programme (MAP) incompliance with the Bursa Malaysia Securities Berhad’sListing Requirements. Mr. Oh Seong Lye and Ms. Soon LiYen have registered to attend the MAP on 27 and 28October 2009.

As an integral part of the Company’s inductionprogrammes for Directors, the senior management andCompany Secretary provide the two new directors with anunderstanding of the operations of the Group throughbriefings on the Group’s businesses, its operations andgovernance arrangements. This includes meetings withsenior management of the Group’s key operating units andvisits to the respective offices and sites.

Other than the above, the Directors did not attend anyexternal training programmes during the financial yearas a result of the Directors’ inability to attend the desiredor selected training programmes due to their workcommitments. However, the Directors are mindful thatthey shall keep abreast with current developments aswell as new and revised statutory and regulatoryrequirements in order for them to discharge their dutieseffectively. The Directors are committed to constantlykeep themselves updated on both local and internationalaffairs, and to changes in regulations affecting the Groupthrough advisories from regulatory bodies, the CompanySecretary and management and through their ownresearch.

g) Remuneration The remuneration of the Directors of the Company arelinked to performance, service seniority, experience andscope of responsibilities and industry market rate so as toensure that the Group attracts, motivates and retainsDirectors with the necessary skills and experience neededto run the Group effectively.

Attendance and numberof meetings held duringthe financial year

Directors

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Announcements to the Bursa Malaysia Securities Berhad oncorporate proposals, quarterly results and annual report andother public announcements, are accessible to shareholdersthrough Bursa Malaysia’s website at http://www.bursamalaysia.com.

Shareholders are presented a review of financial performancefor the financial year at each Annual General Meeting. TheCompany’s Annual General Meeting has always been wellattended and is the principal forum for dialogue and interactionwith the shareholders. It has always been the practice for theChairperson to invite the shareholders to raise any questionsthat they may have in relation to the Group’s activities, financialperformance and prospects and the shareholders’ commentsand suggestions noted by the Board for consideration.

Key investor relation activities such as dialogues with financialand research analysts and investors are held to provideconstructive communications on matters concerning the Group.

The Company’s website at http://www.insas.net provides aneasy and convenient avenue for shareholders and investors togain access to the Group’s corporate information and news andevents.

BOARD COMMITTEE

To ensure the effective discharge of its fiduciary duties, theBoard has delegated specific responsibilities to the AuditCommittee, which operates within clearly defined terms ofreference. The Audit Committee members are thus able todeliberate in greater detail and examine the issues within theirterms of reference in compliance with the Code.

The Audit Committee has been established to assist the Boardin execution of its responsibilities. The Audit Committee meetsperiodically to carry out its functions and duties pursuant to itsterms of reference. Other Board members are also invited toattend the meetings when the needs arise. The AuditCommittee meets with the external auditors at least once a year.

The details of the composition, terms of reference and theactivities of the Audit Committee are set out in the AuditCommittee Report.

ACCOUNTABILITY AND AUDIT

a) Statement of Board of Directors’ Responsibility forPreparing the Financial StatementsThe Board is collectively responsible for ensuring that thefinancial statements give a true and fair view of the state ofaffairs of the Group and Company as at 30 June 2009 andof the results and cash flows of the Group and Company forthe financial year ended on that date.

The Director are pleased to announce that in preparing thefinancial statements for the financial year ended 30 June2009, the Group and the Company have:

• ensured compliance with the requirements of applicableFinancial Reporting Standards issued by the MalaysianAccounting Standards Board and the provisions of theCompanies Act, 1965 in Malaysia;

• adopted and consistently applied the appropriate andrelevant accounting policies; and

• exercised judgments and estimates that are prudent andreasonable.

In line with this, remuneration for the Executive Directorsis aligned to individual and corporate performance. ForNon-Executive Directors, the level of remuneration wouldcommensurate with the level of experience andresponsibility undertaken by them.

The remuneration of Executive Directors comprises fees,salaries and allowances and other customary benefitsmade available by the Group. The remuneration of Non-Executive Directors comprises fees, salaries, allowancesand other customary benefits. The aggregate annualDirectors’ fees for the Non-Executive Directors asrecommended by the Board are to be approved byshareholders at the Annual General Meeting.

The details of the remuneration of Directors of theCompany for the financial year categorised intoappropriate components are as follows :

Fees Salaries & other Benefits Totalemoluments in kind

RM RM RM RM

Executive Directors 176,500 2,295,238* 70,400 2,542,138

Non-Executive Directors 72,000 91,840 20,200 184,040

* This includes the aggregate remuneration of a Non-Executive Director of the Company who is an ExecutiveDirector of certain subsidiary companies.

The remuneration of the Directors are further analysedby applicable bands of RM50,000 which comply with thedisclosure requirements under the Bursa MalaysiaSecurities Berhad’s Listing Requirements. The Board isof the view that the transparency and accountabilityaspect of corporate governance which is applicable toDirectors’ Remuneration are appropriately served by theband disclosure.

The aggregate remuneration of Directors analysed intothe appropriate bands are as follows :

Range of remuneration Executive Non-Executive

Below RM50,000 1 RM50,001 to RM100,000 2 RM500,001 to RM550,000 1 RM850,001 to RM900,000 1 RM1,150,001 to RM1,200,000 1

INVESTOR RELATIONS AND COMMUNICATION WITH SHAREHOLDERS

The Board recognises the importance of maintainingeffective communication with shareholders, stakeholdersand the public on all material business matters affecting theCompany and the Group. In addition to the announcementson the quarterly results and other corporate news, pressreleases and announcements for public dissemination aremade periodically to capture any significant corporate eventor product launch that would be of interest to investors andmembers of the public. The Board places emphasis ontimely and equitable dissemination of information toshareholders and investors to keep them informed of theGroup’s performance, corporate strategy and majordevelopments.

INSAS


The Directors are also responsible for ensuring that theGroup and Company keep proper accounting records. Inaddition, the Directors have overall responsibilities forproper safeguarding of the assets of the Group andCompany and taking such reasonable steps for theprevention and detection of fraud and other irregularities.

b) Financial ReportingThe Board has taken reasonable steps to provide abalanced and understandable assessment of the Group’sfinancial performance and prospects, primarily through theannual report and quarterly financial statements. TheBoard has also empowered the Audit Committee to reviewthe Group’s financial reports to ensure conformity withapplicable Financial Reporting Standards and theprovisions of the Companies Act, 1965 in Malaysia beforethe financial statements are recommended to the Boardfor consideration and approval for release to the public.

c) Internal ControlThe Board recognises the importance of maintaining a soundsystem of internal controls to safeguard the shareholders’investment and the Group’s assets. The information on theGroup’s internal control is set out in the Statement on InternalControl on Page 12 of the Annual Report.

d) Relationship with External Auditors Through the Audit Committee, the Group has establisheda transparent and formal relationship with the Company’sexternal auditors in seeking professional advice andensuring compliance with applicable financial reportingstandards and statutory requirements.

The Group’s external auditors report to the AuditCommittee on any weaknesses in the Group’s internalcontrol system, any non-compliance of financial reportingstandards and communication of fraud that have come totheir attention in the course of their audit. The Group’sexternal auditors also fulfill an essential role to theshareholders of the Company and other users of thefinancial statements by enhancing the reliability of thefinancial statements.

e) Audit FeesThe total of the statutory and non-statutory audit fees(excluding expenses and service taxes) charged by theexternal auditors for the financial year ended 30 June2009 amounted to RM330,320 (2008 : RM266,600).

f) Non Audit FeesThe total of the non-audit fees (excluding expenses andservice taxes) charged for the financial year ended 30 June2009 by the external auditors for services performed for theGroup amounted to RM141,400 (2008 : RM121,500).

OTHER INFORMATION

a) Share buybacksDuring the financial year, the Company bought back atotal of 3,869,600 of its issued shares from the openmarket. The details of the cumulative shares bought backare set out in Note 27 of the audited financial statementson Page 57 of the Annual Report.

b) Share Options, Warrants and IrredeemableConvertible Unsecured Loan Stocks (“ICULS”)During the financial year, the Company increased its issuedand paid up capital from RM618,966,467 toRM693,333,633 by way of the conversion of 74,367,166

units of 8% Irredeemable Convertible Unsecured LoanStocks 1999/2009 (“ICULS”) on the basis of RM1nominal amount of ICULS for every one (1) new ordinaryshare of RM1 each arising from the ICULS’s expiry on 19April 2009.

There were no warrants exercised into ordinary sharesduring the financial year. The warrants lapsed and ceasedto be exercisable upon its expiry on 17 April 2009. Therewere no share options exercised into ordinary sharesduring the financial year.

c) Depository Receipt ProgrammeThe Company did not sponsor any depository receiptprogramme during the financial year.

d) Sanctions and/or penaltiesDuring the financial year, Bursa Malaysia Securities Berhad(“Bursa Securities”) reprimanded M&A Securities Sdn Bhd(“M&A Securities”), a Participating Organisation of BursaSecurities and imposed on M&A Securities a fine ofRM700,000 for the breach of Rule 404.1(7)(b) of the Rules ofBursa Securities. The breach involved M&A Securities’sfailure to exercise strict supervision over the operation of itsKuala Lumpur Branch Office (“KL Branch”) business activitiesand the activities of its KL Branch’s registered persons andemployees in relation to the trading activities of one of M&ASecurities’s commissioned dealer’s representative. Therewere no other sanctions and/or penalties imposed on theGroup, its directors or management by the relevantregulatory bodies.

e) Variation in resultsThere is no material deviation between the profit aftertaxation and minority interest in the announced unauditedconsolidated income statement and the auditedconsolidated income statement for the financial yearended 30 June 2009. There were no profit estimate,forecast or projection issued by the Group and theCompany during the financial year.

f) Profit GuaranteeThere was no profit guarantee given by the Group and theCompany during the financial year under review.

g) Material ContractsThere were no material contracts involving directors andsubstantial shareholders for the financial year.

h) Revaluation policyThere were no revaluation conducted on the Group’slanded properties during the financial year.

i) Corporate Social ResponsibilityDuring the financial year ended 30 June 2009, the Groupcontinue to support welfare and accommodation facilitiesto certain religious and charitable organizations in thecountry. To safeguard the environment and conserveresources, the Group adopts environmentally friendlypractices in its daily operations such as recycling paper,adopt the use of electronic mail and conserve energy atworkplace.

COMMITMENT

The Board will continuously review its principles and practicesin corporate governance in its efforts to achieve the higheststandards of corporate governance throughout the Group.

This Statement is made in accordance with the resolution of theBoard of Directors dated 19 October 2009.

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INTRODUCTION

This Statement is made pursuant to the Bursa Malaysia Securities Berhad’s Listing Requirements Paragraph 15.26(b) which requires the Boardof Directors of public listed companies to make a statement about the state of internal control of the listed entity as a Group in the Annual Report.

The Board of Directors of Insas Berhad (“the Board”) is committed to maintain a sound system of internal controls and risk management practicesto safeguard shareholders’ investment and the Group’s assets. The Board is pleased to provide the Statement on Internal Control which outlinesthe key elements of the internal control system within the Group during the financial year.

ACKNOWLEDGEMENT OF RESPONSIBILITY FOR RISK ANDINTERNAL CONTROLS

The Board affirms its overall responsibility for the Group’s system ofinternal controls which includes the establishment of appropriate controlenvironment as well as review the adequacy and integrity of the Group’sinternal controls, risk management practices and managementinformation systems. In view of the inherent limitations in any system ofinternal controls, the system is designed to manage rather than eliminatethe risk of failure to achieve its corporate objectives. Accordingly, it canonly provide reasonable but not absolute assurance against materialerrors, misstatement, financial losses or fraud. The system of internalcontrols includes inter alia, financial, operational, information technology,organisation, compliance and risk management controls.

Also, the Group’s system of internal controls involves all managementand employees of the Group from each business unit. The Board isresponsible for determining key strategies and policies for significantrisks and controls issues, whilst the management team and functionalkey employees of the Group’s operating units are responsible toimplement the Board’s policies effectively by designing, executing,monitoring and managing the internal control processes.

The Board confirms that there is an ongoing process, for identifying,evaluating and managing the significant risks faced by the Groupthroughout the financial year, which is regularly reviewed by the Boardthrough its Audit Committee, which dedicates separate time fordiscussion of this matter.

RISK MANAGEMENT

The Group has an ongoing risk management process for identifying,evaluating, managing and reviewing significant risks faced by thebusinesses in the Group. The risk management process involves allbusiness and functional units of the Group in identifying the significantrisks affecting the achievement of business objectives and theeffectiveness of controls in place to manage them.

The Board recognises that risk management is an integral part of thesystem of internal control and good management practice that iscritical to the Group’s continued profitability and for enhancement ofshareholders’ value.

The significant business risks faced by the respective business unitsand key issues pertaining to operational and external environment arereviewed by the management team of each business unit. Theresponsibility of managing these risks lies with the respective head ofunits. Key risks relating to the business units’ operations are addressedat periodic management meetings.

The Board undertakes ongoing reviews of key commercial and financialrisks facing the Group’s main businesses together with more general riskssuch as those relating to compliance with law and regulations.

The Group has an on-going credit risk management processundertaken by the respective units’ management team to identify,assess and evaluate principal credit risks and to ensure thatappropriate risk treatments are in place to mitigate these risksaffecting the achievement of the Group’s objectives.

Management reports the monitoring of the risks to the ExecutiveDeputy Chairman/Chief Executive Officer, whose main roles is toassess, on behalf of the Board of Directors, the key risk inherent inthe business and the system of controls that are in place to managethese risks. Changes in the business, operations and the externalenvironment that result in significant risks will be reported to theAudit Committee and the Board accordingly.

KEY ELEMENTS OF THE GROUP’S SYSTEM OF INTERNALCONTROLS

The framework of the Group’s internal control systems and the keyprocedures include:-

1. Management and direction of the Group’s businessesThe Chief Executive Officer (“CEO”) is empowered tomanage the businesses of the Group and is accountable forthe conduct and performance of the Group’s businesseswithin agreed business strategies. The CEO implements theBoard’s expectations of the system of internal controls.

2. Investment and capex appraisals The CEO and the key management team review materialinvestments and the performance of significant projectsundertaken by the Group and make appropriate recommendationsand evaluations to be brought to the Board’s attention.

Proposals for substantial and major capital expenditure of theGroup are reviewed and approved by the Board.

3. Financial and operational review and reportingThe key management team reviews and reports on significantoperational, financial, risk management and legal issues of keyoperating subsidiaries and ensure that remedial actions aretaken by the management of the subsidiaries concerned toaddress deficiencies that arise.

The CEO and the key management team attend management andoperational meetings to review financial and operations reportsand to monitor the performance and profitability of the Group’sbusinesses. Any deviation in corporate strategy and businessobjectives are deliberated and necessary action will be instituted.The CEO practices an ‘open door’ policy whereby matters arisingare promptly highlighted and immediately dealt with.

4. Scheduled Board meetingsThe Board meets at least quarterly and at other scheduledintervals when necessary to maintain full and effective supervisionof the Group’s activities and operations. The General Manager –Finance will lead the presentation of board papers and providecomprehensive explanations of pertinent issues and the Boardwill go through thorough deliberation and discussion beforearriving at any decision which has a bearing on the Group.

The Board reviews the financial and operating information andkey performance indicators of strategic business units andlegal and regulatory matters on a quarterly basis.

5. Audit CommitteeThe Board has the assistance of the Audit Committee whoseprincipal duty is to review and monitor the effectiveness of theGroup’s system of internal control. The Audit Committee meetswith the Group’s principal external auditors to review the auditfindings arising from the statutory audit of the financialstatements and their tests on the system of internal control.

6. Organisational StructureThe Group has an organisational structure which defines theresponsibilities and appropriate level of empowerment at variousauthorisation levels. This is to facilitate quality and timelydecision-making process at the appropriate level in theorganisation hierarchy.

7. Centralised support functionsThe Group also has in place key support functions, which aremanaged centrally at its Corporate Office. These comprise Group

Statement on Internal Control

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Secretarial and Share Registration, Legal, Human Resource,Finance, Treasury and Tax compliance functions. These supportfunctions ensure consistency and compliance in the setting andapplication of policies and procedures relating to these functionsthus reducing duplication of efforts and thereby providingsynergy to the Group.

8. Defined accountability and authorisation levelsThe senior employees and management team of key subsidiarycompanies are responsible for:-- the conduct and performance of their respective business units;- identification and evaluation of significant risks applicable to

their respective businesses together with the design andinstitution of suitable internal controls; and

- meeting defined reporting deadlines and ensuring compliancewith policies, procedure and regulatory requirements;

9. Budgeting ProcessDetailed budgeting process whereby key operating subsidiariesprepare budgets for the coming year, which are approved at theoperating level. Key performance indicators are set for each ofthese operating subsidiaries and the performance are monitoredvia reporting system which highlights significant variancesagainst budgets for investigation and follow-up by themanagement of the respective operating subsidiaries.

10. Specific credit risk managementThe Board, through the relevant management team, adopted aprudent approach with regard to the management of credit risks.Procedures on credit application, review and approval of highvalue loans by the subsidiary company in the money lendingbusiness are undertaken by designated senior management toensure credit risk is contained and the loans are properly andadequately securitised. Procedures for recovery for loansexceeding their credit limit are also in place.

11. Human resource managementThe Board considers the integrity of employees at all levels to beof utmost importance, and this is pursued through itscomprehensive and structured recruitment, appraisal andreward program. The Group also has ongoing training anddevelopment programs to ensure the Group attracts, motivatesand retains competent and skilled employees.

Corporate values and code of conduct, which emphasise on theimportance of key values such as loyalty, integrity, professionalismand cohesiveness are communicated to all employees and are setout in the Group’s Employee Handbook.

12. Annual statutory auditThe external auditors provide assurance in the form of theirannual statutory audit of the financial statements of the Group.Areas for improvement identified during the course of thestatutory audit by the external auditors are brought to theattention of the Audit Committee through management letters orare deliberated at the Audit Committee meetings.

13. Internal auditThe Board has established an internal audit function during thefinancial year.

The internal audit function independently reviews the controlprocesses implemented by the management and reports on itsfindings and recommendations to the Audit Committee.

The Board does not regularly review the system of internal control of itsassociate companies as the Board does not have any direct control overtheir operations. Notwithstanding this, the Group’s interest is servedthrough representation on the boards of the respective associatecompanies and receipt and review of monthly management accounts andinquiry thereon. Where practical, the Group would request for functional,operating and other financial information prepared in accordance withreporting standards that are acceptable to the Group in assessing theperformance of these entities with the objective of safeguarding theinvestment of the Group.

Internal Audit FunctionThe Board recognised that an internal audit function is necessary toprovide independent assessment on the Group’s system of internalcontrols and in the assessment of potential risks exposures in keybusiness processes and in controlling the proper conduct ofbusinesses within the Group.

During the financial year, the Board established an internal auditdepartment as an independent appraisal function following theformal adoption of the Internal Audit Charter by the AuditCommittee. The internal audit function reports to the AuditCommittee, whose authority is sufficient to ensure a broad range ofaudit coverage and adequate consideration of effective action oninternal audit findings and recommendations. The internal auditfunction aims to provide the Audit Committee with independent andobjective advices on the effectiveness of the Group’s businessesand operations.

The scope of internal audit encompass examining and evaluating theadequacy and effectiveness of the Group’s system of internal controlsand the quality of operating performance against established standardsin carrying out assigned responsibilities. The scope of the examinationand the evaluation performed includes the review of:

a) the reliability and integrity of financial and operating informationand the means used to identify, measure, classify and reportinformation;

b) the systems established to ensure compliance with policies,operating procedures, relevant laws, guidelines andregulations that could have a significant impact on Group’soperations;

c) the means of safeguarding the Group’s assets and verifying theirexistence; and

d) the efficiency which resources are utilised and employed.

The activities of the internal audit function during the financial yearwere as follows:

a) reviewed the system of internal controls and conducted riskassessment on selected active operating units of the Group aspart of the Group’s continuous risk management initiative; and

b) reviewed and assessed the adequacy and effectiveness of thesystem of internal controls with regards to the operation,financial and compliance requirements of the Group’s stockbroking unit. The internal audit function reviewed the internalcontrols on selected key activities of the stock broking unit.

The cost incurred by the internal audit function in respect of thefinancial year ended 30 June 2009 are as follows :

RMSalaries and defined contribution plan 54,860Travelling, accommodation and others 1,688

Total 56,548

Effectiveness of Internal ControlThe Board reviews the effectiveness of the system of internal controlof the Group at periodic Board meetings and the effectiveness of theGroup’s system of internal controls will continue to be reviewed,enhanced and updated in line with the changes in the operatingenvironment.

The Board is of the view that the current system of internal controlsthat have been put in place throughout the Group is sufficient tosafeguard the Group’s assets and prevent any material loss to theGroup. The Board is pleased to report that there were no significantinternal control deficiencies or weaknesses that resulted in materiallosses or contingencies to the Group during the financial year thatwould require disclosure in the Annual Report.

This Statement is made in accordance with the resolution of the Boardof Directors passed on 19 October 2009 and has been reviewed bythe external auditors as required under the Bursa Malaysia SecuritiesBerhad’s Listing Requirements Paragraph 15.23.

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The Audit Committee comprises three members of whom all threeare Independent Non-Executive Directors.

The members of the Audit Committee during the financial yearended 30 June 2009 are as follows:

• YAM Tengku Puteri Seri Kemala Pahang Tengku Hajjah Aishahbte Sultan Haji Ahmad Shah, DK(II), SIMPChairperson / Independent Non-Executive Director

• Mr. Oh Seong Lye (appointed on 18 March 2009)Independent Non-Executive Director

• Ms. Soon Li Yen (appointed on 6 March 2009)Non-Independent Non-Executive Director

• Dato’ Wong Gian Kui(resigned from the Audit Committee on 6 March 2009)

• Mr. Micheal Lim Hee Kiang(resigned from the Audit Committee on 18 March 2009)

TERMS OF REFERENCE OF THE AUDIT COMMITTEE

1. Objective

The principal objective of the Audit Committee is to assist theBoard of Directors in fulfilling its fiduciary duties andresponsibilities by reviewing the financial reporting process, thesystem of internal control, the audit process and the Group’sprocess for monitoring compliance with laws and regulations, inparticular to :-

a) ensure transparency, integrity and accountability of theGroup’s activities so as to safeguard the rights and interestsof the shareholders;

b) assist the Board in discharging its fiduciary duties andresponsibilities in relation to management of principal risksand compliance with statutory, legal and regulatoryrequirements;

c) evaluates and monitors the financial reporting process, andprovide assurance that the financial information provided bymanagement is relevant, reliable and timely;

d) ensure the adequacy and integrity of the Group’s system ofinternal controls in carrying out the Group’s operations;

e) ensure regular scheduled meetings are held between theBoard, the senior management and the internal and externalauditors as a forum for communication between theseparties;

f) ensure the independence of the Company’s externalauditors and its ability to conduct its audit without anyrestriction;

g) review the adequacy of the scope, functions, competencyand resources of the internal audit functions and that it hasthe necessary authority to carry out its work; and

h) undertake any other duties as may be appropriate andnecessary to assist the Board.

2. Composition

The Audit Committee shall be appointed by the Board fromamongst their number and shall consist of no fewer than three(3) members. The members of the Audit Committee shall electa Chairman from among their number, who shall be aIndependent Non-Executive Director. An alternate directorcannot be appointed as a member of the Audit Committee. Inthe event of a vacancy in the Audit Committee, the Board shallappoint a new member within three (3) months to fill up thevacancy.

At least one member of the Audit Committee must be :-a) a member of the Malaysian Institute of Accountants; or b) if he is not a member of the Malaysian Institute of

Accountants, he must have at least 3 years’ workingexperience and - (i) he must have passed the examinations specified in Part

I of the First Schedule of the Accountants Act 1967; or

(ii) he must be a member of one of the associations ofaccountants specified in Part II of the First Schedule ofthe Accountants Act 1967.

The Company will ensure the composition of the AuditCommittee shall comply with other requirements as prescribedor approved by the Bursa Malaysia Securities Berhad from timeto time.

3. Authority

The Audit Committee is empowered by the Board to :

a) investigate any matters within its terms of reference;b) have full and unrestricted access to all information and

documents in relation to the Group; c) have direct communication channels with the external

auditors, the internal auditors and to all employees of theGroup;

d) have the resources which are required to perform its duties ;

e) obtain or secure external, legal or other independentprofessional advice and the attendance of external partieswith relevant experience and expertise, at the Group’sexpenses if it considers necessary; and

f) have the right to convene meetings with the externalauditors, the internal auditors or both excluding theattendance of other directors and employees of the Groupand may extend invitation to other non-member directorsand employees of the Group to attend to a specific meeting,whenever it considers necessary.

4. Meetings and Attendance

The Audit Committee shall meet at least 5 times a year or at afrequency to be decided by the Audit Committee. It shallconvene meetings with external auditors, internal auditors orboth, excluding the attendance of other directors andemployees of the Group, whenever deemed necessary. TheAudit Committee may invite other Directors and employees tobe present to assist in resolving and clarifying matters raised.The General Manager - Finance and other seniormanagement employee shall normally attend the meetings. Atleast once a year the Audit Committee shall meet with theexternal auditors.

The Chairman may also convene a meeting of the AuditCommittee if requested to do so by any member, themanagement or the external auditors to consider any matterswithin the scope of its duties and responsibilities.

The quorum for each meeting shall be at least 2 members.

To ensure critical issues are highlighted to all the Boardmembers in a timely manner, where possible, the AuditCommittee meetings are convened prior to the Board meetings.The issues raised at the Audit Committee meetings will befurther deliberated at Board level if necessary. Minutes of theAudit Committee will be circulated to the Board at the nextscheduled meeting.

Five (5) Audit Committee Meetings were held during thefinancial year ended 30 June 2009 as follows:-.

Date of Meetings Time

27 August 2008 11.00 a.m.

17 October 2008 2.00 p.m.

26 November 2008 11.00 a.m.

26 February 2009 11.00 a.m.

29 May 2009 2.30 p.m.

Audit Committee Report

Attendance at the Audit Committee Meetings held during thefinancial year ended 30 June 2009 were as follows:-

Name of Members Attendance andnumber of meetings

YAM Tengku Puteri Seri Kemala Pahang 3/5Tengku Hajjah Aishah bte Sultan Haji Ahmad Shah, DK(II), SIMP

Dato’ Wong Gian Kui 4/4

Mr Michael Lim Hee Kiang 3/4

Mr Oh Seong Lye 1/1

Ms Soon Li Yen 1/1

5. Votings and proceeding at meetings

The decision of the Audit Committee shall be by a majority ofvotes and the determination by a majority of members shall forpurposes be deemed a determination of the Audit Committee. Incase of an equality of votes, the Chairman of the meeting shallhave a second or casting vote.

6. Secretary, keeping of minutes and custody, production andinspection of minutes

The Company Secretary shall be the secretary to the AuditCommittee and shall be responsible in drawing up the agendaand circulating it to the members of the Audit Committee prior toeach meeting. The Company Secretary shall also be responsiblefor keeping minutes of the meetings and circulate them to themembers of the Audit Committee and to the other members of theBoard where issues can be further deliberated where necessary.

The minutes of the meetings shall be signed by the Chairman ofthe meeting at which the proceedings were held or by theChairman of the next succeeding meeting.

The minutes of proceedings of the Audit Committee shall be keptby the Secretary at the registered office of the Company, andshall be open to the inspection of any member of the AuditCommittee or any member of the Board.

7. Duties and Responsibilities

In fulfilling its purpose, the Audit Committee undertakes thefollowing duties and responsibilities:-

a) To oversee matters relating to external audit including thereview of the audit plan in particular the adequacy of existingexternal audit arrangements with emphasis on the scope,quality and findings of the audit, the auditors’ managementletters and the management’s response thereto and theAuditors’ Report;

b) To evaluate the standards of the system of internal control andfinancial reporting including review with the Group’s externaland internal auditors, their evaluation of the system of internalcontrols and ensure the Group’s external and internal auditors’recommendations regarding major management and internalcontrol weaknesses are implemented;

c) To review the adequacy of the scope, functions, competencyand resources of the internal audit functions and that it hasthe necessary authority to carry out its work;

d) To review and consider the scope and results of the InternalAudit programme and its procedures;

e) To consider any significant audit findings reported by theinternal audit function and management’s responses theretoand review whether appropriate actions are taken byManagement on the internal audit recommendations;

f ) To review the quarterly and annual financial statementsbefore submission to the Board, with special focus on anychanges in or implementation of major accounting policiesand practices, significant adjustments resulting from the audit,significant and unusual events and compliance with allrelevant accounting standards and statutory and regulatorydisclosure requirements;

g) To review the assistance and cooperation given by the officersand employees to the external and internal auditors;

h) To review any related party transaction and conflict of interestthat may arise within the Company or the Group including anytransaction, procedure or course of conduct that raisequestion on management integrity;

i) To consider the appointment of the external auditors, theauditors’ remuneration and any matters pertaining toresignation or dismissal of the external auditors;

j) To review the adequacy of the scope, functions, competencyand resources of the internal audit functions and that it hasthe necessary authority to carry out its work;

k) To promptly report to the Bursa Malaysia Securities Berhadany matters reported by the Audit Committee to the Boardwhich have not been satisfactorily resolved resulting in abreach of the Listing Requirements;

l) To consider other function or duty as authorised by the Board.

Summary of Activities of the Audit Committee during thefinancial year

The activities of the Audit Committee in the discharge of its dutiesduring the financial year were as follows:-

a) Reviewed the Group’s quarterly financial results and madesuitable recommendations thereon to the Board for adoption priorto their release to the Bursa Malaysia Securities Berhad;

b) Reviewed the Group’s year-end audited financial statements beforerecommending them for consideration and approval by the Board;

c) Discussed and reviewed the Group’s compliance, in particularthe quarterly and annual audited financial statements with theListing Requirements of Bursa Malaysia Securities Berhad, theprovisions of the Companies Act, 1965 and applicable approvedFinancial Reporting Standards in Malaysia and the changes inexisting or implementation of new accounting standards on theGroup’s financial statements;

d) Reviewed the external auditors’ scope of work and audit planfor the Group;

e) Reviewed with the external auditors the results of their audit, theAuditors’ Report and internal control recommendations in respectof control weaknesses noted in the course of their audit;

f) Reviewed and monitored the credit risk and allowance fordoubtful debts is adequate with regards to the Group’sreceivables in particular from its money lending business on aquarterly basis;

g) Approved the annual internal audit plan covering the operationsand activities of the Group;

h) Reviewed and discussed the internal audit report presented bythe Head of Internal Audit during the audit committee meeting;

i) Ensured other principal risks of the Group are identified andassessed on a periodic basis;

j) Recommend improvements to the operations and the processeswithin the Group;

k) Ensured that an effective system of internal controls is in place toprovide reasonable assurance to minimise the occurrence offraud and material misstatement or error;

l) Reviewed the related party transactions of the Group during thefinancial year and its disclosure in the Group’s financialstatements and ensured that the transactions were undertakenon the Group’s normal commercial terms and that the internalcontrol procedures with regards to the transactions wereadequate, and if any conflict of interest situation could have arisethat raises questions of management integrity.

Internal Audit Function

The Audit Committee obtains reasonable assurance on theeffectiveness of the system of internal controls via the internal auditfunction, which shall be responsible for the regular review andappraisal of the effectiveness of the risk management, system ofinternal controls and governance processes within the Group.

The internal audit function was performed by the in-house internalaudit department set up during the financial year.

The activities of the internal audit function during the financial yearare included under the Statement of Internal Control.

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5 Years Group Financial Highlights

2009 2008 2007 2006 2005RM'000 RM'000 RM'000 RM'000 RM'000

Turnover 241,865 233,500 212,185 163,387 186,959

Profit Before Taxation 61,133 23,144 77,350 24,499 23,986

Profit After Taxation and Minority Interests 51,905 16,566 74,377 21,134 17,388

Total Assets 1,157,547 1,016,033 1,080,067 918,683 915,789

Shareholders’ Funds 774,739 727,735 743,619 680,747 669,001

Number of Shares In Issue, 667,070 596,572 598,513 604,915 605,115net of treasury shares (in Thousand)

Net Earnings Per Share (in Sen) 8.47 2.77 12.37 3.49 2.86

Net Assets Per Share (in Sen) 116.1 108.7 106.9 95.4 93.4

2009

2008

2007

2006

2005

2009

2008

2007

2006

2005

242

234

212

163

187

0 50 100 150 200 250 300

Turnover (RM’mil)

2009

2008

2007

2006

2005

1,158

1,016

1,080

919

916

0 500 1,000 1,500

Total Assets (RM’mil)

61

23

77

24

24

0 10 20 30 40 50 60 70 80 90

Profit before Taxation (RM’mil)

2009

2008

2007

2006

2005

775

728

744

681

669

600 650 700 750 800

Shareholders’ Funds (RM’mil)

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contents18 Directors’ Report

22 Statement by Directors and Statutory Declaration

23 Independent Auditors’ Report

24 Balance Sheets

26 Income Statements

27 Statements of Changes in Equity

29 Cash Flow Statements

32 Notes to the Financial Statements


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directors’ reportand financial statements

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The Directors hereby submit their report together with the audited financial statements of the Group and of the Company for thefinancial year ended 30 June 2009.

PRINCIPAL ACTIVITIESThe principal activities of the Company are investment holding and the provision of management services. The principal activitiesof its subsidiary companies and its associate companies are disclosed in Note 48 to the financial statements.

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

FINANCIAL RESULTSGroup Company

RM’000 RM’000

Profit for the financial year 57,097 66,919

Attributable to :

Equity holders of the Company 51,905 66,919

Minority interests 5,192 -

57,097 66,919

DIVIDENDSThere were no dividends proposed, declared or paid by the Company since the end of the previous financial year.

RESERVES AND PROVISIONSThere were no material transfers to or from reserves or provisions during the financial year other than as disclosed in the Notesto the financial statements.

SHARE CAPITAL AND DEBENTURESDuring the financial year:

(a) There were no changes in the authorised share capital of the Company; and

(b) The Company increased its issued and paid up capital from RM618,966,467 to RM693,333,633 by way of conversion of74,367,166 units of 8% Irredeemable Convertible Unsecured Loan Stocks 1999/2009 (“ICULS”) on the basis of RM1nominal amount of ICULS for every one (1) new ordinary share of RM1 each.

The above mentioned new ordinary shares rank pari passu in all respects with the existing ordinary shares of the Companyexcept that the new shares shall not be entitled to any dividend or other distributions declared in respect of the financialperiod in which the ICULS are converted or any interim dividend declared prior to the date of conversion of the ICULS.

There were no debentures issued during the financial year.

IRREDEEMABLE CONVERTIBLE UNSECURED LOAN STOCKS AND WARRANTSOn 20 April 1999, a total of RM141,965,866 nominal amount of 8% Irredeemable Convertible Unsecured Loan Stocks 1999/2009(“ICULS”) were issued with 567,863,464 detachable Warrants on the basis of RM1 nominal amount of ICULS with 4 Warrantsattached for every 4 existing ordinary shares of RM1 each held in the Company.

The terms of the conversion of the ICULS and the terms of the exercise of the Warrants are disclosed in Note 28 to the financial statements.

Pursuant to a Directors’ resolution of the Company dated 25 June 2008, the Board has approved the cancellation of a total ofRM29,400,700 nominal amount of ICULS held by the Group. The total ICULS in issue prior to the cancellation wasRM103,767,866 nominal amount of ICULS. Pursuant to the Trust Deed dated 9 February 1999, any ICULS that remain in issueon the expiry date on 19 April 2009 shall be converted into fully paid ordinary shares of RM1 each in the Company bysurrendering RM1 nominal amount of ICULS for 1 new ordinary share of RM1 each credited as fully paid in the capital of theCompany. The aforesaid cancellation was completed on 5 August 2008. The total number of outstanding ICULS after thecancellation was RM74,367,166 nominal amount of ICULS.

On 13 April 2009, a total of RM1,250 nominal amount of ICULS which were converted into new ordinary shares of RM1 each ofthe Company, was granted listing and quotation on the Official List of Bursa Securities.

The remaining RM74,365,916 nominal amount of ICULS which were converted to new ordinary shares of RM1 each of theCompany upon its expiry, was granted listing and quotation on the Official List of Bursa Securities on 4 May 2009.

Directors’ Report

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INFORMATION ON THE FINANCIAL STATEMENTS Before the financial statements of the Group and of the Company were made out, the Directors took reasonable steps:

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

(b) to ensure that any current assets which were unlikely to realise in the ordinary course of business including their value asshown in the accounting records of the Group and of the Company have been written down to an amount which they mightbe expected so to realise.

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

(a) which would render the amount written off as bad debts or the amount of the allowance for doubtful debts in the financialstatements of the Group and of the Company inadequate to any substantial extent; or

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

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

No contingent or other liability has become enforceable or is likely to become enforceable within the period of twelve monthsafter the end of the financial year which, in the opinion of the Directors, will or may affect the ability of the Group and of theCompany to meet its obligations as and when they fall due.

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

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

(b) any contingent liability of the Group and of the Company which has arisen since the end of the financial year.

SIGNIFICANT EVENTS DURING THE FINANCIAL YEARSignificant events during the financial year are disclosed in Note 49 to the financial statements.

SIGNIICANT EVENT SUBSEQUENT TO BALANCE SHEET DATESignificant event subsequent to the balance sheet date is disclosed in Note 50 to the financial statements.

OTHER STATUTORY INFORMATIONThe Directors state that:

At the date of this report, they are not aware of any circumstances not otherwise dealt with in this report or the financialstatements which would render any amount stated in the financial statements misleading.

In their opinion:

(a) the results of the Group’s and of the Company’s operations during the financial year were not substantially affected by anyitem, transaction or event of a material and unusual nature except as disclosed in the Notes to the financial statements; and

(b) there has not arisen in the interval between the end of the financial year and the date of this report any item, transaction orevent of a material and unusual nature likely to affect substantially the results of the operations of the Group and of theCompany for the financial year in which this report is made.

DIRECTORSThe Directors in office since the date of the last report are:

Y.A.M. Tengku Puteri Seri Kemala Pahang Tengku Hajjah Aishah bte Sultan Haji Ahmad Shah, DK(II), SIMPDato’ Thong Kok Khee Dato’ Wong Gian Kui Dr Tan Seng Chuan Soon Li Yen (appointed on 6.3.2009)Oh Seong Lye (appointed on 18.3.2009)Mr Melwani Ashok Bhagwandas (resigned on 6.3.2009)Dato’ Thong Kok Yoon (resigned on 18.3.2009)Mr Michael Lim Hee Kiang (resigned on 18.3.2009)Mr Cheong Eng Tick (resigned on 29.5.2009)

In accordance with Article 96 of the Company’s Articles of Association, Dr Tan Seng Chuan retires at the forthcoming AnnualGeneral Meeting and, being eligible, offer himself for re-election.

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DIRECTORS (CONT’D)In accordance with Article 101 of the Company’s Articles of Association, Soon Li Yen and Oh Seong Lye retire at the forthcomingAnnual General Meeting and, being eligible, offer themselves for re-election.

The shares, ICULS and Warrants holdings in the Company and the shareholdings in its related corporations of those who wereDirectors at the financial year end are as follows:

Ordinary shares of RM1 eachInterest in the Company At At

1.7.2008 Bought Allotted#(i) Sold 30.6.2009Direct interestY.A.M. Tengku Puteri Seri Kemala Pahang

Tengku Hajjah Aishah bte Sultan HajiAhmad Shah, DK(II), SIMP 115,000 - - - 115,000

Dato’ Thong Kok Khee 500,000 - 1,125,000 - 1,625,000Dato’ Wong Gian Kui 200,000 73,000 100,000 - 373,000

Deemed interest Y.A.M. Tengku Puteri Seri Kemala Pahang

Tengku Hajjah Aishah bte Sultan Haji Ahmad Shah, DK(II), SIMP 2,441,856 - - - 2,441,856

Dato’ Thong Kok Khee 137,946,352 - 28,234,273 - 166,180,625 Dato’ Wong Gian Kui 755,000 225,000 - - 980,000

Ordinary shares of RM1 eachInterest in subsidiary companies At At

1.7.2008 Bought Sold 30.6.2009Insas Properties Sdn Bhd

Direct interestDato’ Wong Gian Kui 80,000 - - 80,000

Segar Raya Development Sdn Bhd

Direct interestDato’ Wong Gian Kui 129,999 - - 129,999

Deemed interestDato’ Wong Gian Kui 80,000 - - 80,000

Premium Yield Sdn Bhd


Dellmax Worldwide Sdn Bhd


Contibina Sdn Bhd

Deemed interestDato’ Thong Kok Khee 80,000 - - 80,000

Gryphon Asset Management Sdn Bhd

Deemed interestDato’ Thong Kok Khee 500,000 - - 500,000

Micromodule Pte Ltd

Direct interest Number of Ordinary sharesDr Tan Seng Chuan 315,161 - - 315,161

INSAS


DIRECTORS (CONT’D)

ICULS of RM1 eachInterest in the Company At At

1.7.2008 Bought Sold Converted#(i) Cancelled#(i) 30.6.2009Direct interestDato’ Thong Kok Khee 1,125,000 - - 1,125,000 - - Dato’ Wong Gian Kui 100,000 - - 100,000 - -

Deemed interest Dato’ Thong Kok Khee 63,634,973 2,700 6,002,700 28,234,273 29,400,700 -

Unit of WarrantsAt At

1.7.2008 Bought Expired#(iii) 30.6.2009Direct interestY.A.M. Tengku Puteri Seri Kemala Pahang

Tengku Hajjah Aishah bte Sultan Haji Ahmad Shah, DK(II), SIMP 15,000 - 15,000 -

Dato’ Thong Kok Khee 1 - 1 -

Deemed interestDato’ Thong Kok Khee 92 - 92 -

# (i) The ICULS was converted into new ordinary shares in the Company by surrendering RM1 nominal amount of ICULS for1 new ordinary share of RM1 each upon the ICULS’s expiry on 19 April 2009.

(ii) A total of RM29,400,700 nominal amount of ICULS have been cancelled by the Company on 5 August 2008.

(iii) The warrants lapsed and ceased to be exercisable upon its expiry on 17 April 2009.

By virtue of Dato’ Thong Kok Khee’s interest in the shares of the Company, he is also deemed interested in the shares of itsrelated corporations to the extent that the Company has an interest under Section 6A of the Companies Act, 1965.

None of the other Directors in office at the end of the financial year had any interest in shares, options and debentures of theCompany or its related corporations during the financial year.

DIRECTORS’ BENEFITS During and at the end of the financial year, no arrangement subsisted to which the Company is a party, with the object or objectsof enabling Directors of the Company to acquire benefits by means of acquisition of shares in or debentures of the Company orany other body corporate.

Since the end of the previous financial year, no Director has received or become entitled to receive any benefit (other thanbenefits as disclosed in the Notes to the financial statements) by reason of a contract made by the Company or a relatedcorporation with the Director or with a firm of which the Director is a member, or with a company in which the Director has asubstantial financial interest.

AUDITORSMessrs SJ Grant Thornton has expressed their willingness to continue in office.

Signed on behalf of the Board in accordance with the resolution of the Board of Directors dated 19 October 2009.

DATO’ THONG KOK KHEEDirector

DATO’ WONG GIAN KUI Director

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We, Dato’ Thong Kok Khee and Dato’ Wong Gian Kui, being two of the Directors of Insas Berhad, do hereby state that in theopinion of the Directors, the accompanying financial statements are drawn up in accordance with the provision of the CompaniesAct, 1965 and Financial Reporting Standards in Malaysia so as to give a true and fair view of the financial position of the Groupand of the Company as at 30 June 2009, results of the operations and the cash flows of the Group and of the Company for thefinancial year then ended.

Signed on behalf of the Board in accordance with a resolution of the Board of Directors dated 19 October 2009.

DATO’ THONG KOK KHEE

DATO’ WONG GIAN KUIKuala Lumpur19 October 2009

Statutory Declaration

I, Dato’ Thong Kok Khee, being the Director primarily responsible for the financial management of Insas Berhad, do solemnlyand sincerely declare that to the best of my knowledge and belief, the accompanying financial statements are correct and I makethis solemn declaration conscientiously believing the same to be true and by virtue of the provisions of the Statutory DeclarationsAct, 1960.

Subscribed and solemnly declared by )the abovenamed at Kuala Lumpur in )the Federal Territory this day of )19 October 2009 ) DATO’ THONG KOK KHEE

Before me:

T THANDONEE RAJAGOPAL(W228)Commissioner for OathsKuala Lumpur

Statement by Directors

INSAS


Report on the Financial Statements

We have audited the financial statements of Insas Berhad, which comprise the balance sheets of the Group and of the Companyas at 30 June 2009, the income statements, statements of changes in equity and cash flow statements of the Group and of theCompany for the financial year then ended, and a summary of significant accounting policies and other explanatory notes, asset out on pages 24 to 80.

Directors’ Responsibilities for the Financial Statements

The directors of the Company are responsible for the preparation and fair presentation of these financial statements inaccordance with Financial Reporting Standards and the Companies Act 1965 in Malaysia. This responsibility includes: designing,implementing and maintaining internal control relevant to the preparation and fair presentation of financial statements that arefree from material misstatement, whether due to fraud or error; selecting and applying appropriate accounting policies; andmaking accounting estimates that are reasonable in the circumstances.

Auditors’ Responsibilities

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

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

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

Opinion

In our opinion, the financial statements have been properly drawn up in accordance with Financial Reporting Standards and theCompanies Act 1965 in Malaysia so as to give a true and fair view of the financial position of the Group and of the Company asof 30 June 2009 and of their financial performance and cash flows for the financial year then ended.

Report on Other Legal and Regulatory Requirements

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

(a) In our opinion, the accounting and other records and the registers required by the Act to be kept by the Company and itssubsidiary companies of which we have acted as auditors have been properly kept in accordance with the provisions of the Act.

(b) We have considered the financial statements and the auditors’ reports of all the subsidiary companies of which we have notacted as auditors, as disclosed in Note 48 to the financial statements.

(c) We are satisfied that the financial statements of the subsidiary companies that have been consolidated with the Company’sfinancial statements are in form and content appropriate and proper for the purposes of the preparation of the financialstatements of the Group and we have received satisfactory information and explanations required by us for those purposes.

(d) The auditors’ reports on the financial statements of the subsidiary companies did not contain any qualification or anyadverse comment made under Section 174 (3) of the Act.

Other Matters

This report is made solely to the members of the Company, as a body, in accordance with Section 174 of the Companies Act1965 in Malaysia and for no other purpose. We do not assume responsibility to any other person for the content of this report.

SJ GRANT THORNTON(NO. AF: 0737)CHARTERED ACCOUNTANTS

DATO’ N. K. JASANI(NO: 708/03/10(J/PH)CHARTERED ACCOUNTANT

Kuala Lumpur 19 October 2009

Independent Auditors’ Report TO THE MEMBERS OF INSAS BERHAD

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Group Company

Note 2009 2008 2009 2008RM'000 RM'000 RM'000 RM'000

ASSETSNon-current Assets

Property, plant and equipment 6 66,527 46,523 258 285 Prepaid land lease payments 7 4,893 583 - - Investment properties 8 51,495 48,769 - - Land held for development 9 37,576 37,576 - - Long term investments 10 97,705 58,703 345 345 Subsidiary companies 11(a) - - 141,089 221,089Associate companies 12(a) 15,140 15,838 1,184 1,224Intangible assets 13 21,313 22,953 - - Goodwill 14 184 1,633 - - Deferred tax assets 15 1,570 3,992 - -

Total non-current assets 296,403 236,570 142,876 222,943

Current AssetsProperty development costs 16 42,298 30,543 - - Inventories 17 20,245 21,957 - - Trade receivables 18 169,118 204,549 - - Accrued billings 19 9,602 5,930 - - Amount due from subsidiary companies 11(b) - - 648,854 533,250Amount due from associate companies 12(b) 4,761 3,416 109 110 Other receivables, deposits and prepayments 20 36,581 34,803 10,061 9,229 Tax recoverable 4,366 9,820 802 6,168Short term investments 21 59,204 - - - Marketable securities 22 53,641 50,466 - - Deposits with licensed banks and

financial institutions 23 430,611 376,775 24,004 1,687Cash and bank balances 24 30,717 24,451 1,587 190

Total current assets 861,144 762,710 685,417 550,634Non-current assets classified as held for sale 25 - 16,753 - 9,453

861,144 779,463 685,417 560,087

TOTAL ASSETS 1,157,547 1,016,033 828,293 783,030

EQUITY AND LIABILITIESEquity Attributable to Equity Holders of the Company

Share capital 26 693,334 618,966 693,334 618,966 Reserves 27 67,969 68,103 55,082 56,2628% Irredeemable convertible unsecured

loan stocks 1999/2009 28 - 79,043 - 90,538Retained profit/(Accumulated losses) 13,436 (38,377) 702 (77,620)

774,739 727,735 749,118 688,146Minority interests 20,328 18,752 - -

TOTAL EQUITY 795,067 746,487 749,118 688,146

Non-current LiabilitiesLoans and borrowings 29 3,314 4,930 - - Hire purchase payables 30 8,232 8,840 - 8 Deferred tax liabilities 15 976 774 - -

Total non-current liabilities 12,522 14,544 - 8

Balance Sheets AS AT 30 JUNE 2009

INSAS


BALANCE SHEETS (CONT’D)

Group CompanyNote 2009 2008 2009 2008

RM'000 RM'000 RM'000 RM'000

Current LiabilitiesTrade payables 210,746 204,063 - - Progress billings 31 63 5,622 - - Amount due to subsidiary companies 11(b) - - 63,918 90,422Amount due to an associate company 12(c) 10,304 - 10,304 - Other payables and accruals 32 48,361 32,895 953 4,454Loans and borrowings 29 80,259 11,688 4,000 - Tax payable 225 734 - -

Total current liabilities 349,958 255,002 79,175 94,876

TOTAL LIABILITIES 362,480 269,546 79,175 94,884

TOTAL EQUITY AND LIABILITIES 1,157,547 1,016,033 828,293 783,030

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

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Group CompanyNote 2009 2008 2009 2008

RM'000 RM'000 RM'000 RM'000

Revenue 33 241,865 233,500 2,396 7,229

Cost of sales (186,781) (177,124) - -

Gross profit 55,084 56,376 2,396 7,229

Other income 34 28,107 21,232 7,849 10,162

Administration expenses 35 (20,470) (13,657) (5,166) (4,814)

Other operating expenses 36 (54,114) (39,232) - -

Finance costs 37 (3,492) (3,007) (952) (764)

Exceptional items 38 56,302 (1,703) 62,346 -

Share of profits less losses ofassociate companies (284) 3,135 - -

Profit before taxation 61,133 23,144 66,473 11,813

Taxation 39 (4,036) (2,345) 446 (1,097)

Profit for the financial year 57,097 20,799 66,919 10,716

Attributable to :Equity holders of the Company 51,905 16,566 66,919 10,716

Minority interests 5,192 4,233 - -

Net profit for the financial year 57,097 20,799 66,919 10,716

Earnings per share (sen)

- Basic 40 8.47 2.77

- Diluted 40 - 2.36


Income Statements FOR THE FINANCIAL YEAR ENDED 30 JUNE 2009

INSAS


Attributable to Equity Holders of the Company

RetainedICULS - Exchange profit/

Share Share equity Reserve translation Treasury (Accumulated) Minority Total capital premium component fund reserve shares losses) Total interests Equity

RM'000 RM'000 RM'000 RM'000 RM'000 RM'000 RM'000 RM'000 RM'000 RM'000

Group

Balance at 1 July 2007 618,966 66,394 103,768 1,200 8,860 (8,939) (46,630) 743,619 13,389 757,008

Repurchase of shares - - - - - (1,193) - (1,193) - (1,193)

Purchase of ICULS by the Group - - (24,725) - - - - (24,725) - (24,725)

Advances from minority shareholders - - - - - - - - 1,470 1,470

Net gains/(losses) not recognised in the income statement- Currency translation

differences - - - - 1,781 - - 1,781 (47) 1,734

- Distribution to holders of ICULS (Note 37) - - - - - - (8,313) (8,313) - (8,313)

Dividends paid to minority shareholders - - - - - - - - (293) (293)

Net profit for the financial year - - - - - - 16,566 16,566 4,233 20,799

Balance at 30 June 2008 618,966 66,394 79,043 1,200 10,641 (10,132) (38,377) 727,735 18,752 746,487

Conversion of ICULS to ordinary shares 74,368 - (74,368) - - - - - - -

Repurchase of shares - - - - - (1,180) - (1,180) - (1,180)

Net gains/(losses) not recognised inthe income statement- Currency translation

differences - - - - 1,046 - - 1,046 53 1,099

- Distribution to holders of ICULS (Note 37) - - - - - - (4,767) (4,767) - (4,767)

- Gain arising from cancellation of ICULS - - (4,675) - - - 4,675 - - -

Repayment of advances to minorityshareholders - - - - - - - - (1,470) (1,470)

Statements of Changes in Equity FOR THE FINANCIAL YEAR ENDED 30 JUNE 2009

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Attributable to Equity Holders of the CompanyRetained

ICULS - Exchange profit/Share Share equity Reserve translation Treasury (Accumulated Minority Total

capital premium component fund reserve shares losses) Total interests EquityRM'000 RM'000 RM'000 RM'000 RM'000 RM'000 RM'000 RM'000 RM'000 RM'000

Subscription of redeemable convertible preference shares in a subsidiary company by a minority shareholder - - - - - - - - 300 300

Dividends paid to minority shareholders - - - - - - - - (2,499) (2,499)

Net profit for the financial year - - - - - - 51,905 51,905 5,192 57,097

Balance at 30 June 2009 693,334 66,394 - 1,200 11,687 (11,312) 13,436 774,739 20,328 795,067

COMPANY

Balance at 1 July 2007 618,966 66,394 103,768 - - (8,939) (80,023) 700,166

Repurchase of shares - - - - - (1,193) - (1,193)

Purchase of ICULS by the Company - - (13,230) - - - - (13,230)

Net losses not recognised in the income statement- Distribution to holders

of ICULS (Note 37) - - - - - - (8,313) (8,313)

Net profit for the financial year - - - - - - 10,716 10,716

Balance at 30 June 2008 618,966 66,394 90,538 - - (10,132) (77,620) 688,146

Conversion of ICULS to ordinary shares 74,368 - (74,368) - - - - -

Repurchase of shares - - - - - (1,180) - (1,180)

Net losses not recognised in the income statement- Distribution to holders

of ICULS (Note 37) - - - - - - (4,767) (4,767)

- Gain arising from cancellation of ICULS - - (16,170) - - - 16,170 -

Net profit for the financial year - - - - - - 66,919 66,919

Balance at 30 June 2009 693,334 66,394 - - - (11,312) 702 749,118


INSAS


Group Company2009 2008 2009 2008

CASH FLOWS FROM OPERATING ACTIVITIES RM'000 RM'000 RM'000 RM'000


Adjustments for:

Accretion of discount on investments (218) - - - Allowance for diminution in value of long term investment 844 2,812 - - Allowance for diminution in value of marketable securities 1,990 5,878 - - Allowance for diminution in value of short term investment 90 - - - Allowance for doubtful debts 12,843 6,426 - - Allowance for obsolete inventories 386 - - - Allowance for slow moving inventories - 419 - - Amortisation of development expenditure 43 27 - - Amortisation of long term investment 22 20 - - Amortisation of prepaid land lease payments 68 13 - - Amortisation of intangible assets 1,640 1,628 - - Amortisation of premium on long term investment 21 - - - Bad debts written off 1 40 - - Depreciation of investment properties 477 1,460 - - Depreciation of property, plant and equipment 13,931 6,586 100 100 Gain on disposal of associated companies (56,782) - (62,346) - Gain on disp0osal of investment properties (2,539) (780) - - Impairment loss on goodwill 1,449 - - - Inventories written off 4 - - - Impairment loss on investment properties 984 - - - Loss on divestment of interest in an associate company - 29 - - Long term investment written off 1,956 - - - Net gain on disposal of property, plant and equipment (512) (267) - - Net reversal of impairment loss on investment properties - (329) - - Property, plant and equipment written off 97 16 - - Reversal of allowance for doubtful debts (190) (40) - - Share of profits less losses of associate companies 284 (3,135) - - Unrealised foreign exchange (gain)/loss (4,778) 3,159 (18) (114)Dividend income (2,084) (2,789) (1,700) (5,220)Interest expenses 3,492 3,007 952 764 Interest income (6,723) (7,011) (7,831) (10,047)

Operating profit/(loss) before working capital 27,929 40,313 (4,370) (2,704)

Changes in working capital:-Land held for development - 142 - - Property development costs (11,756) (971) - - Inventories 1,413 (5,039) - - Marketable securities (2,633) (7,651) - - Receivables 25,609 207,036 (832) 73 Accrued billings (3,672) (1,701) - - Payables 22,113 (55,732) 638 (9)Progress billings (5,559) 1,620 - - Amount due from/to associate companies 8,963 (3) 10,305 (4)Amount due from/to subsidiary companies - - (138,763) (45,036)

Net cash generated from/(used in) operations 62,407 178,014 (133,022) (47,680)

Cash Flow Statements FOR THE FINANCIAL YEAR ENDED 30 JUNE 2009

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Group Company2009 2008 2009 2008

CASH FLOWS FROM OPERATING ACTIVITIES (CONT’D) RM'000 RM'000 RM'000 RM'000

Interest received 6,723 7,011 4,245 2,130Interest paid (8,259) (11,320) (9,076) (8,305)Tax refund 3,820 2,800 5,987 4,337

Net cash generated from/(used in) operating activities 64,691 176,505 (131,866) (49,518)

CASH FLOWS FROM INVESTING ACTIVITIES

Purchase of property, plant and equipment (Note A) (32,178) (10,334) (73) (20)Proceeds from disposal of property, plant and equipment 752 626 - - Subscription of shares in associate companies (400) (1,115) - - Cash received from partial redemption of preference

shares in an associate company - 2,400 - 2,400 Cash received from capital reduction by a subsidiary

company (Note 11) - - 80,000 60,000Payment on investment properties (6,550) (1,280) - - Proceeds from disposal of investment properties 7,351 8,108 - - Purchase of long term investments (44,909) - - - Purchase of short term investments (59,353) - - (13,230)Payment for development expenditure (21) (782) - - Payment for intangible asset (22) (71) - - Prepaid land lease payments (4,378) - - - Dividend received 2,797 4,199 1,000 1,000 Proceeds from divestment of interest in an associate company 62 471 62 - Proceeds from disposal of non-current assets held for sale 73,323 - 71,777 - Net cash acquired on acquisition of equity

interest in subsidiary companies (Note 43) - - - -

Net cash (used in)/generated from investing activities (63,526) 2,222 152,766 50,150

CASH FLOWS FROM FINANCING ACTIVITIES

Dividends paid to minority shareholders ofsubsidiary companies (2,499) (293) - -

Increase in monies held in trust (7,191) (16,187) - - Increase in fixed deposits pledged (34,727) (3,960) - - Increase in cash and bank balances pledged - (70) - - Net cash used in share buyback (1,180) (1,193) (1,180) (1,193)Drawdown of loans and borrowings 106,772 16,849 4,000 - Repayment of loans and borrowings (38,447) (9,713) - - (Repayment to)/advances received from

minority shareholders (1,470) 1,470 - - Subscription of redeemable convertible preference

shares in a subsidiary company by a minority shareholder 300 - - - Repayment of hire purchase payables (3,827) (3,240) (31) (29)

Net cash generated from/(used in) financing activities 17,731 (16,337) 2,789 (1,222)

INSAS


Group Company2009 2008 2009 2008

CASH AND CASH EQUIVALENTS RM'000 RM'000 RM'000 RM'000

Net changes 18,896 162,390 23,689 (590)Brought forward 209,747 46,585 1,877 2,353Exchange differences 852 772 25 114

Carried forward (Note B) 229,495 209,747 25,591 1,877

NOTES TO CASH FLOW STATEMENTS

A. PROPERTY, PLANT AND EQUIPMENTDuring the financial year, the Group acquired property, plant and equipment with an aggregate cost ofRM35,639,000 (2008:RM16,933,000) of which RM3,461,000 (2008:RM6,599,000) was acquired by means of hirepurchase arrangements. Cash payments for the acquisition of property, plant and equipment amounted to RM32,178,000(2008:RM10,334,000).

During the financial year, the Company acquired property, plant and equipment with an aggregate cost ofRM73,000 (2008:RM20,000) via cash.

B. CASH AND CASH EQUIVALENTS COMPRISE OF:-

Group Company2009 2008 2009 2008

RM'000 RM'000 RM'000 RM'000

Overdrafts (1,180) (2,744) - - Cash and bank balances 30,717 24,451 1,587 190 Deposits with licensed banks and

financial institutions 430,611 376,775 24,004 1,687

460,148 398,482 25,591 1,877

Less: Cash and bank balances pledged (70) (70) - - Remisiers’ deposits and clients’ trust monies (185,459) (178,268) - - Fixed deposits pledged (45,124) (10,397) - -

229,495 209,747 25,591 1,877


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1. BASIS OF PREPARATION

(a) Statement of complianceThe financial statements of the Group and the Company have been prepared in accordance with the provisions of theCompanies Act, 1965 and Financial Reporting Standards (“FRSs”) issued by the Malaysian Accounting StandardsBoard (“MASB”).

(b) Basis of measurementThe financial statements of the Group and the Company are prepared under the historical cost convention, unlessotherwise indicated in the summary of significant accounting policies.

(c) Functional and presentation currenciesThe financial statements are presented in Ringgit Malaysia, which is the Company’s functional currency. All financialinformation presented is in Ringgit Malaysia and are rounded to the nearest thousand except when otherwise stated.

(d) The use of estimates and judgementsThe preparation of financial statements requires management to make judgements, estimates and assumptions thataffect the application of accounting policies and the reported amounts of assets, liabilities, income and expenses.Actual results may differ from these estimates.

Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates arerecognised in the period in which the estimate is revised and in any future periods affected.

(i) Depreciation of property, plant and equipment and investment propertiesProperty, plant and equipment and investment properties are depreciated on a straight-line basis over their usefullives. The Group estimates the useful lives of property, plant and equipment and investment properties based onthe period over which the assets are expected to be available for use. The estimated useful lives of property, plantand equipment and investment properties are reviewed on a periodical basis and are updated if expectations differfrom previous estimates due to physical wear and tear, technical or commercial obsolescence and legal or otherlimits on the use of the relevant assets. In addition, the estimation of the useful lives of property, plant andequipment are based on the internal evaluation and experience with similar assets. A reduction in the estimateduseful lives of the property, plant and equipment would increase the recorded expenses and decrease the non-current assets.

(ii) Classification between investment properties and property, plant and equipmentThe Group has developed certain criteria based on FRS 140 in making judgment whether a property qualifies asan investment property. Investment property is a property held to earn rentals or for capital appreciation or both.

Some properties comprise a portion that is held to earn rentals or for capital appreciation and another portion thatis held for administration purposes. If the property is not to be sold separately, the property is an investmentproperty only if an insignificant portion is held for administrative purpose.

(iii) Property development revenue and costsThe Group recognises property development revenue and costs in the income statement using the stage ofcompletion method. The stage of completion is determined by the proportion that property development costsincurred for work performed to date bear to the estimated total property development costs.

Significant judgment is required in determining the stage of completion, the extent of the property developmentcosts incurred, the estimated total property development revenue and costs, as well as the recoverability of theproject development costs. In making the judgment, the Group evaluates based on past experience and by relyingon the work of the related project architects and surveyors.

(iv) Impairment of assetsThe carrying amounts of assets are reviewed at each balance sheet date to determine whether there is anyindication of impairment. If any such indication exists, the asset’s recoverable amount is estimated to determinethe amount of the impairment loss.

For the purpose of impairment testing of assets, recoverable amount is determined on an individual asset basisunless the asset does not generate cash flows that are largely independent of those from other assets. If this isthe case, recoverable amount is determined for the cash-generating unit (“CGU”) to which the asset belongs to.

An asset’s recoverable amount is the higher of an asset’s or CGU’s fair value less costs to sell and its value in use.In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-taxdiscount rate that reflects current market assessments of the time value of money and the risks specific to the asset.

Notes to the Financial Statements 30 JUNE 2009

INSAS


1. BASIS OF PREPARATION (CONT’D)

(d) The use of estimates and judgements (cont’d)

(v) Income taxesSignificant estimation is involved in determining the group-wide provision for income taxes. There are certaintransactions and computations for which the ultimate tax determination is uncertain during the ordinary course ofbusiness. The Group recognises liabilities for expected tax issues based on estimates of whether additional taxeswill be due. Where the final tax outcome of these matters is different from the amounts that were initiallyrecognised, such differences will impact the income tax and deferred tax provisions in the period in which suchdetermination is made.

(vi) Deferred tax assetsDeferred tax assets are recognised for all deductible temporary differences, unutilised business losses andunabsorbed capital allowances to the extent that it is probable that taxable profit will be available against whichall the deductible temporary differences, unutilised business losses and unabsorbed capital allowances can beutilised. Significant management judgement is required to determine the amount of deferred tax assets that canbe recognised, based upon the likely timing and level of future taxable profits together with future tax planningstrategies.

2. FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES

The Group’s activities expose it to various financial risks such as foreign currency exchange risk, interest rate risk, marketrisk, credit risk and liquidity and cash flow risks. Financial risk management is carried out through risk reviews, internalcontrol systems and adherence to the Group financial risk management practices. The Board regularly reviews these risksand approves the treasury policies covering the management of these risks.

The main areas of financial risks faced by the Group and the policy in respect of the major areas of treasury activity are setout as follows:-

(a) Foreign currency exchange riskThe Group is exposed to foreign currency exchange risk as a result of its investing and normal operating activitieswhere the currency denomination differs from the local currency. The Group maintains a natural hedge, wheneverpossible, by borrowing in the currency of the country in which the property or investment is located or by matchingincome and expenditure to minimise foreign exchange. The Group is also exposed to foreign currency risk as a resultof its trade purchases and utilises foreign currency forward contracts to hedge the risk exposure.

(b) Interest rate riskThe Group’s exposure to the risk of changes in the interest rates relates primarily to the Group’s bank borrowings fromlicensed banks and financial institutions. The Group’s policy is to manage its interest costs by obtaining the mostfavorable interest rates on its borrowings. Surplus funds of the Group are invested with licensed banks and financialinstitutions such as fixed deposits and repurchase agreements to generate interest income.

(c) Market riskThe Group faces exposure to the risk from changes in the debt and equity prices, in particular the Group’s exposurefrom changes in market price on its quoted marketable securities and other long term quoted investments. The risk ofloss in value of the Group’s quoted securities and investments are minimized through thorough analysis before makinginvestments and continuous monitoring of the performance of the investments.

(d) Credit riskThe Group controls credit risk by application of credit evaluations and approvals, credit limits and monitoringprocedures. Trade and loan receivables are monitored on an ongoing basis via management reporting procedures andwhere necessary, loan receivables are required to deposit sufficient assets as collateral and adhere to credit limitswithin the fair values of assets placed as collateral. The Group does not have any significant exposure to any individualcustomer nor does it have any major concentration of credit risk related to any financial instruments.

(e) Liquidity and cash flow risksThe Group actively manages its operating cash flows and the availability of funding so as to ensure that all financingand funding needs are met. As part of its overall prudent liquidity management, the Group maintains sufficient levelsof cash or cash convertible instruments to meet its working capital requirements. Certain subsidiary companies withinthe Group maintain reasonable amount of committed credit and banking facilities to meet their operating needs.

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3. SIGNIFICANT ACCOUNTING POLICIES

(a) Basis of consolidationThe consolidated financial statements incorporate the financial statements of the Company and its subsidiarycompanies as disclosed in Note 48 to the financial statements made up to the end of the financial year. The subsidiarycompanies are consolidated using purchase method except for M & A Securities Sdn Bhd, which is consolidated usingthe merger method of accounting in accordance with the provisions of Malaysian Accounting Standards No. 2.

Under the merger method of accounting, the results of the subsidiary companies are accounted on a full year basisirrespective of the date of merger. The difference between the nominal value of shares issued as consideration formerger and nominal value of share capital of the subsidiary companies is taken to merger reserve, which in turn istransferred to the income statement.

Following the adoption of FRS No. 3, Business Combinations, the Group will comply with the required criteria formerger accounting as stipulated in the said standard prospectively with effect from 1 January 2006 for future acquisitionof subsidiary companies.

Under the purchase method of accounting, the results of the subsidiary companies acquired or disposed off areincluded from the date of acquisition or up to the date of disposal. At the date of acquisition, the fair value of thesubsidiary companies’ net assets are determined and reflected in the Group’s financial statements. The excess of thepurchase consideration paid for the shares in the subsidiary companies over the fair value of the underlying net assetsof the subsidiary companies acquired represents goodwill arising on consolidation.

All significant inter-company transactions, balances and the resulting unrealised gains are eliminated on consolidationand the consolidated financial statements reflect external transactions only. Unrealised losses are eliminated onconsolidation unless cost cannot be recovered.

Any exchange differences arising on translation of inter-company indebtedness are taken to the shareholders’ interestin the consolidated financial statements.

Uniform accounting policies are adopted in the consolidated financial statements for like transactions and events insimilar circumstances.

The total assets and liabilities of subsidiary companies are included in the consolidated balance sheet and the interestof minority shareholders in the net assets is stated separately.

(b) Property, plant and equipment

(i) Recognition and measurementProperty, plant and equipment are stated at cost less accumulated depreciation and impairment losses. The policyfor the recognition and measurement of impairment losses is in accordance with Note 3(aa) to the financialstatements.

When significant parts of an item of property, plant and equipment have different useful lives, they are accountedfor as separate items (major components) of property, plant and equipment.

Restoration cost relating to an item of property, plant and equipment is capitalised only if such expenditure isexpected to increase the future benefits from the existing property, plant and equipment beyond its previouslyassessed standard of performance.

Cost of properties under construction includes attributable borrowing cost incurred to finance these assets up tothe date when these properties are completed and ready for use.

An item of property, plant and equipment is derecognised upon disposal or when no future economic benefits areexpected from its use. The difference between the net disposal proceeds, if any and the net carrying amount isrecognised in the income statement and the unutilised portion of the revaluation surplus on that item is takendirectly to retained earnings.

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3. SIGNIFICANT ACCOUNTING POLICIES (CONT’D)

(b) Property, plant and equipment (cont’d)

(ii) DepreciationFreehold land has an unlimited useful life and therefore is not depreciated. Properties under construction are alsonot depreciated until these assets are fully completed and brought into use.

Depreciation of other property, plant and equipment is calculated on a straight line basis to write off the cost ofeach asset to its residual value over the estimated useful life, at the following annual rates:-

Freehold buildings 2 – 5%Plant, machinery, motor vehicles and renovation 10 – 34%Office furniture, fittings and equipment 10 – 34%Long term leasehold building Over the unexpired period of the lease

The depreciable amount is determined after deducting the residual value. The residual value, depreciation methodand useful life are reviewed at each financial year end to ensure that the amount, method and period ofdepreciation are consistent with previous estimates and the expected pattern of consumption of the futureeconomic benefits embodied in the items of property, plant and equipment.

(iii) Changes in estimatesThe revised FRS 116: Property, Plant and Equipment requires the review of the residual value and remaininguseful life of an item if property, plant and equipment at least at each financial year end.

During the financial year, a subsidiary company has reviewed the useful lives of the property, plant and equipmentand has revised the depreciation rates of the following items so as to reflect the future economic benefits to bederived by the subsidiary company from their use:-

New rate Old rate

Plant, machinery and renovation 33% 10 – 20%Office furniture, fittings and equipment 20 – 33% 10 – 20%

The revision was accounted for prospectively as a change in accounting estimates and as a result, thedepreciation charge for the Group increased by RM4.13 million for the current financial year.

(c) Prepaid land lease paymentsLeasehold land that has an indefinite economic life with title that is not expected to pass to the Group by end of thelease term is classified as operating lease. The up front payments for the right to use the leasehold land over apredetermined period are accounted for as prepaid land lease payments. Prepaid land lease payments are stated atcost less accumulated amortisation and impairment losses. The Group’s prepaid land lease payments are amortisedon a straight line basis over the remaining period of the lease of 45 years. The policy for the recognition andmeasurement of impairment losses is in accordance with Note 3(aa) to the financial statements.

(d) Investment propertiesInvestment properties are properties which are owned or held under a leasehold interest to earn rental income or forcapital appreciation or for both. These include land held for a currently undetermined future use.

(i) Measurement basisInvestment properties are stated at cost less depreciation and impairment losses. The cost of investmentproperties includes expenditure that is directly attributable to the acquisition of the asset.

The policy for the recognition and measurement of impairment losses is in accordance with Note 3(aa) to thefinancial statements.

Investment properties are derecognised when either they have been disposed off or when the investment propertyis permanently withdrawn from use and no future economic benefit is expected from its disposal. Any gains orlosses on retirement or disposal of an investment property are recognised in the income statement in the financialyear in which they arise.

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(d) Investment properties (cont’d)

(ii) DepreciationFreehold land is not depreciated.

Depreciation is calculated to write off the depreciable amount of other investment properties on a straight-linebasis over their estimated useful lives. Depreciable amount is determined after deducting the residual value fromthe cost of the investment property.

The principal annual depreciation rates used are as follows:

Freehold buildings 2 %Long term leasehold buildings Over the unexpired period of the lease

The residual values, useful lives and depreciation methods are reviewed and adjusted if appropriate, at eachbalance sheet date.

(e) Land held for developmentLand held for development consists of cost of land on which no significant development activities have been carriedout or where development activities is not expected to be completed within the Group’s normal operating cycle.Such land is classified within non-current assets and is stated at cost less any accumulated impairment losses. Thepolicy for the recognition and measurement of impairment losses is in accordance with Note 3(aa) to the financialstatements.

Included in land held for development is cost associated with the acquisition of land and all related costs incurredon activities necessary to put the land in a condition ready for development. Land held for development istransferred to property development costs within current asset at the point when development activities commenceand where it can be demonstrated that the development activities can be completed with the Group’s normaloperating cycle.

(f) Investments

(i) Government guarantee bonds and unquoted corporate bondsGovernment guarantee bonds and unquoted corporate bonds are stated at cost adjusted for amortisation ofpremiums or accretion of discounts calculated on an effective yield basis from the date of purchase to theirmaturity dates. The amortisation of premiums and accretion of discounts are charged or credited to incomestatement.

On the maturity or disposal of investment in bonds, the difference between the redemption amount or net disposalproceeds and its carrying amount is recognised in the income statement.

Investments in bonds with maturity dates greater than 12 months from the balance sheet date are classifiedas long term investments in the balance sheet. Allowance for diminution in value will be made if, in theopinion of the Directors, such diminution is of a permanent nature. The diminution is charged to the incomestatement.

(ii) Dual currency investments Dual currency investments are yield enhancing investments that provide higher guaranteed return than regularforeign currency deposits. In exchange for higher guaranteed returns, on maturity date, the financial institution hasthe right to return the investment amount in the original currency or the alternate currency based on pre-agreedforeign exchange rates which are determined on the investment start date.

Dual currency investments are classified as short term investments in the balance sheet and are stated at cost.

(iii) Other long term investmentsOther investments which are held on long term basis are stated at cost less accumulated amortisation andallowance for diminution in value. Allowance for diminution in value of long-term investment will be made if, in theopinion of the Directors, such diminution is of a permanent nature. The diminution is charged to the incomestatement.

On the disposal of an investment, the difference between the net disposal proceeds and its carrying amount isrecognised in the income statement.

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(g) Subsidiary companiesSubsidiary companies are those companies over which the Group has power to exercise control over the financial andoperating policies so as to obtain benefits from its activities.

Investment in subsidiary companies, which are eliminated on consolidation, are stated at cost in the Company’sfinancial statements less impairment losses. Where an indication of impairment exists, the carrying amount of theinvestment is assessed and written down to its recoverable amount. The policy for the recognition and measurementof impairment losses is in accordance with Note 3(aa) to the financial statement.

On the disposal of investment in subsidiary companies, the difference between net disposal proceeds and theircarrying amounts is recognised in the income statement.

(h) Associate companiesAssociate companies are entities in which the Group has significant influence and that is neither a subsidiary nor aninterest in a joint venture. Significant influence is the power to participate in the financial and operating policy decisionsof the investee but not in control or joint control over those policies.

Investments in associate companies are accounted for in the consolidated financial statements using the equitymethod of accounting.

Under the equity method, the investment in associate company is carried in the consolidated balance sheet at costadjusted for post-acquisition changes in the Group’s share of net assets of the associate company. The Group’s shareof the net profit or loss of the associate company is recognised in the consolidated income statement. Where there hasbeen a change recognised directly in the equity of the associate company, the Group recognises its share of suchchanges in equity. In applying the equity method, unrealised gains and losses on transaction between the Group andthe associate company are eliminated to the extent of the Group’s interest in the associate company. After theapplication of the equity method, the Group determines whether it is necessary to recognise any additional impairmentlosses with respect to the Group’s net investment in the associate company. The associate company is equityaccounted for from the date the Group obtains significant influence until the date the Group ceases to have significantinfluence over the associate company.

Goodwill relating to an associate company is included in the carrying amount of the investment and is not amortised, Anyexcess of the Group’s share of the net fair value of the associate company’s identifiable assets and liabilities over the cost ofthe investment is excluded from the carrying amount of the investment and is instead included as income in the determinationof the Group’s share of the associate company‘s profit or loss in the period in which the investment is acquired.

When the Group’s share of losses in an associate company equals or exceeds its interest in the associate company,the Group does not recognise further losses, unless it has incurred obligations or made payments on behalf of theassociate companies.

The most recent available audited and/or management financial statements of the associated companies are used bythe Group in applying equity method of accounting.

In the Company’s separate financial statements, investments in associate companies are stated at cost lessimpairment losses. The policy for the recognition and measurement of impairment losses is in accordance with Note3(aa) to the financial statement.

On the disposal of such investments, the difference between net disposal proceeds and their carrying amounts isrecognised in the income statement.

(i) Intangible assetIntangible assets acquired separately are measured at cost on initial recognition. The cost of intangible assets acquiredin a business combination is their fair value as at the date of acquisition. Following initial recognition, intangible assetsare carried at cost less any accumulated amortisation and impairment losses.

The useful lives of intangible assets are assessed to be either finite or infinite. Intangible assets with finite lives areamortised on a straight-line basis over their estimated economic useful lives and assessed for impairment wheneverthere is an indication the intangible asset may be impaired. The amortisation period and amortisation method for anintangible asset with a finite useful life are reviewed at least at each balance sheet date.

Intangible assets with infinite useful lives are not amortised but tested for impairment annually or more frequently if theevents or changes in circumstances indicate that the carrying value may be impaired either individually or at the cash-generating unit level. The useful life of an intangible asset with an infinite life is also reviewed annually to determinewhether the useful life assessment continues to be supportable.

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(i) Intangible asset (cont’d)

(i) Intangible asset – Stock broking dealer’s licenseThe stock broking dealer’s license was acquired by M & A Securities Sdn Bhd, a wholly-owned subsidiary of theGroup to operate a branch office in Kuala Lumpur and is recognised as an intangible asset in the balance sheet.

The intangible asset is stated at cost less accumulated amortisation and impairment losses. The intangible assetis amortised on a straight line basis over a period of 20 years, being the estimated life of the asset. The carryingvalue is reviewed annually by the Directors to ensure it is not in excess of the recoverable value. The recoverableamount is assessed on the basis of the expected cash flows which will be received from the employment of theintangible asset. The policy for the recognition and measurement of impairment losses is in accordance with Note3(aa) to the financial statements.

(ii) Intangible asset - Development expenditureIntangible asset arising from development or from the development phase of an internal project is recognised ifall of the following have been demonstrated:

- the technical feasibility of completing the intangible asset so that it will be available for use or sale;

- the intention to complete the intangible asset and use or sell it;

- the ability to use or sell the intangible asset;

- how the intangible asset will generate probable future economic benefits;

- the availability of adequate technical, financial and other resources to complete the development and to useor sell the intangible asset; and

- the ability to measure reliably the expenditure attributable to the intangible asset during its development.

The amount initially recognised for expenditure incurred on development activities is the sum of the expenditureincurred from the date when the intangible asset first meets the recognition criteria listed above. Expenditureincurred on development activities that do not meet these criteria are expensed to the income statement whenincurred.

The expenditure on development activities are stated at cost less accumulated amortisation and impairmentlosses. This expenditure is to be amortised on a straight line basis over its expected useful lives.

The policy for measurement and recognition of impairment losses is in accordance with Note 3(aa).

(iii) Intangible asset - TrademarkThe initial cost incurred on the search and application for registration of the trademark is capitalised, and is statedat cost less accumulated amortisation and impairment losses. The trademark is assessed to have a finite usefullife and is amortised on a straight-line basis over 10 years, being the validity period the certificate of registrationof the trademark is to be granted.

The policy for measurement and recognition of impairment losses is in accordance with Note 3(aa).

(j) GoodwillGoodwill on consolidation represents the excess of the purchase consideration paid for the shares in the subsidiarycompanies over the fair value of the underlying net assets of the subsidiary companies acquired. Goodwill onconsolidation is stated at cost less impairment losses.

Negative goodwill represents the excess of the fair value of the underlying net assets of the subsidiary companiesacquired over the purchase consideration paid for the shares in the subsidiary companies. With the adoption of FRS3 beginning 1 January 2006, negative goodwill is recognised immediately in the income statement.

Goodwill is tested for impairment annually or more frequently if events or changes in circumstances indicate that thegoodwill may be impaired. The policy for the recognition and measurement of impairment losses of goodwill is inaccordance with Note 3(aa) to the financial statements.

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(k) Non-current assets held for sale and discontinued operationsA component of the Group is classified as discontinued operation when the criteria to be classified as held for sale havebeen met or it has been disposed off and such a component represents a separate major line of business orgeographical area of operations, is part of a single co-ordinated major line of business or geographical area ofoperations or is a subsidiary company acquired exclusively with a view for resale.

Disposal groups or non-current assets are classified as held for sale if their carrying amount will be recoveredprincipally through a sale transaction rather than through continuing use. This condition is regarded as met only whenthe sale is highly probable and the asset is available for immediate sale in its present condition subject only to termsthat are usual or customary.

Immediately before classification as held for sale, the measurement of the non-current assets is brought up-to-date inaccordance with applicable FRSs. Then, on initial classification as held for sale, non-current assets are measured inaccordance with FRS 5 that is at the lower of carrying amount and fair value less costs to sell. Any differences arerecognised in the income statement.

(l) Property development costProperty development costs comprise cost of land and all related costs that are directly attributable to developmentactivities or that can be allocated on a reasonable basis to such activities.

When the financial outcome of a development activity can be reliably estimated, property development revenue andexpenditure are recognised in the income statement by using the stage of completion method. The stage of completionis determined by the proportion that property development costs incurred for work performed to date bear to theestimated total property development costs. In applying this method, only those costs that reflect actual developmentwork performed are included as property development costs incurred.

Where the financial outcome of a development activity cannot be reliably estimated, development revenue isrecognised only to the extent of property development costs incurred that is probable will be recoverable, and propertydevelopment costs on properties sold are recognised as an expenses in the period in which they are incurred.

Any expected loss on a development project, including costs to be incurred over the defect liability period is recognisedas an expense immediately.

The excess of revenue recognised in the income statement over billings to purchasers is classified as accrued billingsand the excess of billings to purchasers over revenue recognised in the income statement is classified as progressbillings within the consolidated balance sheet.

(m) InventoriesInventories comprising raw material, work-in-progress, finished goods, goods purchased for resale and properties heldfor sale are stated at the lower of cost and net realisable value.

Cost is determined using the first in first out method, the weighted average cost method or by specific identification.The cost of raw materials comprises costs of purchase. The cost of finished goods and work-in-progress comprise costof raw materials, direct labour, other direct costs and appropriate proportions of production overheads based on normaloperating capacity. The cost of unsold properties held under inventories comprises cost associated with the acquisitionof land and buildings, direct costs and appropriate proportion of common costs.

Net realisable value is the estimated selling price in the ordinary course of business less the estimated costs ofcompletion and the estimated costs incurred in marketing, selling and distribution.

(n) ReceivablesTrade and other receivables are carried at anticipated realisable value. Bad debts are written off when they areidentified. Specific allowance is made for debts that are considered doubtful of collection based on a review of alloutstanding amounts as at the balance sheet date.

(o) Marketable securitiesMarketable securities are stated at the lower of cost and market value on an aggregate portfolio basis. Cost isdetermined on the weighted average basis while market value is determined based on reference to quoted sellingprices at the close of business on the balance sheet date. Increases or decreases in the carrying value are creditedor charged to the income statement.

On the disposal of marketable securities, the difference between net disposal proceeds and the carrying amount isrecognised in the income statement.

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(p) Cash and cash equivalents Cash and cash equivalents comprise of cash in hand, bank balances and deposits at call that are free fromencumbrances and short term highly liquid investments which have an insignificant risk of changes in value.

The Group has excluded remisiers’ deposits and clients’ monies held in trust by the stock broking subsidiary companiesand cash and fixed deposits pledge to licensed banks and financial institutions from its cash and cash equivalents.

(q) Share capitalOrdinary shares are classified as equity which are recorded at the nominal value and proceeds in excess of the nominalvalue of shares issued, if any, are accounted for as share premium. Both ordinary shares and share premium areclassified as equity. Dividends on ordinary shares are recognised in equity in the period in which they are declared.

The transaction cost of an equity transaction which comprise only those incremental external costs directly attributableto the equity transaction are accounted for as a deduction from share premium, net of tax, from the proceeds.

(r) Minority interestsMinority interests in the consolidated balance sheet consist of the minorities’ share of the fair values of identifiableassets and liabilities of the acquiree and advances received from the minority shareholders.

Minority interests are presented in the consolidated balance sheets and statements of changes in equity within equity,separately from equity attributable to the equity shareholders of the Company. Minority interests in the results of theGroup is presented on the face of the consolidated income statements as an allocation of the total profit or loss for theperiod between the minority interests and the equity shareholders of the Company.

Where losses applicable to the minority interests exceed the minority’s interest in the equity of a subsidiary company,the excess and any further losses applicable to the minority are charged against the Group’s interest except to theextent that the minority has a binding obligation to, and is able to, make additional investment to cover the losses. Ifthe subsidiary company subsequently reports profits, the Group’s interest is allocated all such profits until the minority’sshare of losses previously absorbed by the Group has been recovered.

(s) Hire purchase payablesThe cost of property, plant and equipment acquired under hire purchase arrangements are capitalised. Thedepreciation policy on these property, plant and equipment is similar to that of the Group’s property, plant andequipment depreciation policy. Outstanding obligation due under the hire purchase arrangements after deductingfinance expenses are included as liabilities in the financial statements. Finance charges on hire purchase agreementsare allocated to income statement over the period of the respective agreements.

(t) PayablesTrade and other payables are stated at cost which is the fair value of the consideration to be paid in the future for goodsand services rendered. Payables are recognised when there is a contractual obligation to deliver cash or anotherfinancial asset to other entity.

(u) Provision for liabilitiesProvision for liabilities are recognised when the Group has a present legal or constructive obligation as a result of apast event and it is probable that an outflow of resources embodying economic benefits will be required to settle theobligations and a reliable estimate of the amount can be made. Provisions are reviewed at each balance sheet dateand adjusted to reflect the current best estimate. Where the effect of the time value of money is material, the amountof provision is the present value of the expenditure expected to be required to settle the obligation.

(v) Contingent liabilitiesWhere it is not probable that an outflow of economic benefits will be required, or the amount cannot be estimated reliably,the obligation is disclosed as a contingent liability, unless the probability of outflow of economic benefits is remote.Possible obligations, whose existence will only be confirmed by the occurrence or non-occurrence of one or more futureevents are also disclosed as contingent liabilities unless the probability of outflow of economic benefits is remote.

Where the Company enters into financial guarantee contracts to guarantee the indebtedness of other companies withinthe Group, the Company treats the guarantee as a contingent liability until such time as it becomes probable that theCompany will be required to make a payment under the guarantee.

(w) Interest-bearing borrowingsInterest-bearing bank loans and overdrafts are recorded at the amount of proceeds received, net of repayments.

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(x) Financial instrumentsFinancial instruments are recognised in the balance sheets when the Group has become a party to the contractualprovisions of the instrument.

Financial instruments are classified as liabilities or equity in accordance with the substance of the contractualarrangement. Interest, dividends, gains and losses relating to a financial instrument classified as liability are reportedas expense or income. Distributions to holders of financial instruments classified as equity are charged directly toequity. Financial instruments are offset when the Group has a legally enforceable right to offset and intends either tosettle on a net basis or to realise the asset and settle the liability simultaneously.

(y) Income taxIncome tax on the profit or loss for the financial year comprises current and deferred tax. Current tax is the expectedamount of income taxes payable in respect of the taxable profit for the financial year and is measured using the taxrates that have been enacted at the balance sheet date.

Deferred tax is provided for, using the liability method, on temporary differences at the balance sheet date between thetax bases of assets and liabilities and their carrying amounts in the financial statements. In principle, deferred taxliabilities are recognised for all taxable temporary differences and deferred tax assets are recognised for all deductibletemporary differences, unused tax losses and unused tax credits to the extent that it is probable that the taxable profitwill be available against which the deductible temporary differences, unused tax losses and unused tax credits can beutilised. Deferred tax is not recognised if the temporary differences arise from goodwill or negative goodwill or from theinitial recognition of an asset or liability in a transaction which is not a business combination and at the time of thetransaction, affects neither accounting profit nor taxable profit.

Deferred tax is measured at the tax rates that are expected to apply in the period when the asset is realised or theliability is settled, based on tax rates that have been enacted or substantively enacted at the balance sheet date.Deferred tax is recognised in the income statement, except when it arises from a transaction which is recogniseddirectly in equity, in which case the deferred tax is also charged or credited directly in equity, or when it arises from abusiness combination that is an acquisition, in which case the deferred tax is included in the resulting goodwill ornegative goodwill.

(z) Revenue recognition

(i) Sale of development propertiesRevenue from sale of development properties represents the proportionate sales value of development propertiessold attributable to the percentage of development work performed during the financial year.

(ii) Sale of goods and trading activitiesRevenue from sale of goods and trading activities is measured at the fair value of the consideration receivableand is recognised upon delivery of product and customer acceptance if any, net of discount and sales returns.Revenue is not recognised to the extent where there are significant uncertainties regarding recovery of theconsideration due, associated costs or the possible return of goods.

(iii) Sale of marketable securitiesRevenue from sale of marketable securities are recognised based on the contracted value net of brokeragesexpenses and stamp duties.

(iv) Revenue from broking activitiesRevenue from broking activities are recognised upon execution of contracts. Brokerage income is accounted fornet of remisiers’ commission and dealers’ incentives.

(v) Rental incomeRental income from investment property is recognised in the income statement on a straight-line basis over thespecific tenure of the respective leases. The aggregate cost of incentives provided to lessees is recognised as areduction of rental income over the lease term on a straight-line basis.

(vi) Dividend incomeDividend income is recognised when the right to receive payment has been established and no significantuncertainty existed with regard to its receipt.

(vii) Interest incomeInterest income is recognised on accruals basis unless recoverability is in doubt, in which case the recognition ofinterest is suspended. Subsequent to suspension, interest is recognised on receipt basis.

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(z) Revenue recognition (cont’d)

(vii) Interest income (cont’d)Interest income from investments in bonds, loan stocks and dual currency investments are recognised on a timeproportion basis that takes into account the effective yield of the assets.

(viii) Revenue from services and fee incomeRevenue from services are recognised when services are rendered and invoice issued. Revenue is recognisednet of sales and service tax, where applicable.

Revenue on fee income from sale of customised goods and services and contract maintenance are recognisedon completion of each stage of assignments.

(aa) Impairment of assets

(i) Impairment of goodwillGoodwill is tested for impairment annually or more frequently if events or changes in circumstances indicate thatthe goodwill may be impaired. For the purpose of impairment testing, goodwill is allocated to each of the Group’scash generating units that are expected to benefit from synergies of the business combination.

An impairment loss is recognised in the income statement when the carrying amount of the cash generating unitincluding goodwill exceeds the recoverable amount of the cash generating unit. Recoverable amount of the cashgenerating unit is the higher of the cash generating unit’s fair value less cost to sell and its value in use. In assessingvalue in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate thatreflects current market assessments of the time value of money and the risks specific to the asset.

The total impairment loss is allocated first to reduce the carrying amount of goodwill allocated to the cashgenerating unit and then to the other assets of the cash generating unit proportionately on the basis of the carryingamount of each asset in the cash generating unit.

Impairment loss recognised on goodwill is not reversed in the event of an increase in recoverable amount insubsequent periods.

(ii) Impairment of non financial assets At each balance sheet date, the Group reviews the carrying amounts of its assets to determine whether there isany indication of impairment.

If such indication exists, or when annual impairment testing for an asset is required, the recoverable amount isestimated and an impairment loss is recognised whenever the recoverable amount of the asset is less than itscarrying amount. Recoverable amount of an asset is the higher of its fair value less costs to sell and its value in use.

In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-taxdiscount rate that reflects current market assessments of the time value of money and the risks specific to the asset.

An impairment loss is recognised as an expense in the income statement immediately, unless the asset is carriedat a revalued amount. Any impairment loss of a revalued asset is treated as a revaluation decrease to the extentof any unutilised previously recognised revaluation surplus for the same asset.

An assessment is made at each balance sheet date as to whether there is any indication that previouslyrecognised impairment losses for an asset may no longer exist or may have decreased. If such indication exists,the recoverable amount is estimated. A previously recognised impairment loss is reversed only if there has beena change in the estimates used to determine the asset recoverable amount. That increased amount cannotexceed the carrying amount that would have been determined, net of depreciation, had no impairment loss berecognised for the asset in prior financial years.

All reversals of impairment losses are recognised as income immediately in the income statement unless the assetis carried at revalued amount, in which case the reversal in excess of impairment loss previously recognisedthrough the income statement is treated as revaluation increase. After such a reversal, the depreciation charge isadjusted in future periods to allocate the revised carrying amount of the asset, less any residual value, on asystematic basis over its remaining useful lives.

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(bb) Foreign currencies

(i) Functional and presentation currencyThe individual financial statements of each entity in the Group are measured using the currency of the primaryeconomic environment in which the entity operates (“the functional currency”). The consolidated financialstatements are presented in Ringgit Malaysia, which is also the Company’s functional currency.

(ii) Foreign currency transaction and balancesIn preparing the financial statements of the individual entities, transactions in currencies other than the entity’sfunctional currency (foreign currencies) are recorded in the functional currencies using the exchange ratesprevailing at the dates of the transactions. At each balance sheet date, monetary items denominated in foreigncurrencies are translated at the rates prevailing on the balance sheet date. Non-monetary items carried at fairvalue that are denominated in foreign currencies are translated at the rates prevailing on the date when the fairvalue was determined. Non-monetary items that are measured in terms of historical cost in a foreign currency aretranslated using the exchange rates at the date of transaction.

Exchange differences arising on the settlement of monetary items and on the translation of monetary items areincluded in the income statement for the period. Exchange differences arising on the translation of non-monetaryitems carried at fair value are included in the income statement for the period except for the differences arising onthe translation of non-monetary items in respect of which gains and losses are recognised directly in equity.Exchange differences arising from such non-monetary items are also recognised directly in equity.

(iii) Foreign operationsFor the purposes of consolidation, net assets of the foreign subsidiary companies are translated into RinggitMalaysia at the exchange rate ruling at the balance sheet date. Exchange differences arising from thesetranslations are transferred directly to exchange translation reserve.

Goodwill and fair value adjustments arising on the acquisition of a foreign entity are treated as assets and liabilitiesof the foreign entity on or after 1 January 2006 and are recorded in the functional currency of the foreignoperations and translated at the closing rate at the balance sheet date. Goodwill and fair value adjustments thatarose in the acquisition of foreign subsidiary companies before 1 January 2006 are deemed to be assets andliabilities of the parent company and are recorded in RM at the rates prevailing at the date of acquisition.

The principal exchange rates used for each respective unit of foreign currency ruling at balance sheet date are asfollows :-

2009 2008

RM RM 1 Australian Dollar 2.86 3.14 1 US Dollar 3.53 3.26 1 Sterling Pound 5.86 6.51 1 Hong Kong Dollar 0.46 0.42 1 Singapore Dollar 2.43 2.401 Euro 4.98 5.151 Taiwanese Dollar 0.11 0.111 Japanese Yen 0.04 0.031 Mongolia Tugrik 0.002466 0.0028141 Swiss Franc 3.27 3.20

(cc) Operating leasesLeases of assets where substantially all the risks and rewards of ownership of the assets remain with the lessor areaccounted for as operating leases. Operating lease payments are recognised as an expense in the income statementon a straight-line basis over the term of the relevant lease.

When an operating lease is terminated before the lease period has expired, any payment required to be made to thelessor by way of penalty is recognised as an expense in the income statement immediately.

(dd) Borrowing costsAll borrowing costs are recognised in the income statement using the effective interest method, in the period in whichthey are incurred except to the extent that they are capitalised 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 itsintended use.

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(dd) Borrowing costs (cont’d)The capitalisation of borrowing costs as part of the cost of a qualifying asset commences when expenditure for theasset is being incurred, borrowing costs are being incurred and activities that are necessary to prepare the asset forits intended use or sale are in progress. Capitalisation of borrowing costs is suspended or ceases when substantiallyall the activities necessary to prepare the qualifying asset for its intended use or sale are interrupted or completed.

(ee) Employee benefits

(i) Short term benefitsWages, salaries, allowances, bonuses and social security contributions are recognised as an expense in thefinancial year in which the associated services are rendered by employees of the Group. Short term accumulatingcompensated absences such as paid annual leave are recognised when services are rendered by employees thatincrease their entitlement to future compensated absences.

(ii) Defined contribution planDefined contribution plans are post-employment benefit plans under which the Group pays fixed contributions intoseparate entities or funds and will have no legal or constructive obligation to pay further if any of the funds do nothold sufficient assets to pay all employee benefits relating to employee services in the current and precedingfinancial years. Such contribution is recognised as an expense in the income statement as incurred. As requiredby law, companies in Malaysia make contributions to the Employees Provident Fund. Some of the Group’s foreignsubsidiaries make contributions to their respective countries statutory pension schemes.

(ff) Segmental reportingThe Group adopts business segment analysis as its primary reporting format and geographical segment analysis asits secondary reporting format.

Segment reporting is presented for enhanced assessment of the Group’s risk and returns. Business segments provideproducts or services that are subject to risk and returns that are different from those of other business segment.Geographical segments provide products or services within a particular economic environment that is subject to risksand returns that are different from those components operating in other economic environment. Segment revenues,expenses, assets and liabilities are those amounts resulting from the operating activities of a segment that are directlyattributable to the segment and the relevant portion that can be allocated on a reasonable basis to the segment.

4. ADOPTION OF FINANCIAL REPORTING STANDARDS (“FRSs”)

The accounting policies adopted by the Group and the Company are consistent with those of the previous financial year and inconformity with the applicable FRSs, the approved accounting standards for entities other than private entities issued by the MASB.

The Group and the Company has not early adopted the following new/revised Standards and IC Interpretations (“IC Int”)that have been issued by the MASB:-

Effective for accounting period beginning on or after 1 July 2009

FRS 8 : Operating Segments

Effective for accounting period beginning on or after 1 January 2010

FRS 4 : Insurance ContractsFRS 7 : Financial Instruments : DisclosuresFRS 123 : Borrowing CostsFRS 139 : Financial Instruments : Recognition and MeasurementAmendments : First-time Adoption of Financial Reporting Standardsto FRS 1 Amendments : Share-based Payment – Vesting Conditions and Cancellationsto FRS 2Amendments : Consolidated and Separate Financial Statements: Cost of an to FRS 127 Investment in a Subsidiary, Jointly Controlled Entity or AssociateIC Int 09 : Reassessment of Embedded DerivativesIC Int 10 : Interim Financial Reporting and ImpairmentIC Int 11 : FRS 2 – Group and Treasury Share TransactionsIC Int 13 : Customer Loyalty ProgrammesIC Int 14 FRS : 119 – The Limit on a Defined Benefit Asset, Minimum Funding Requirements and their Interaction

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4. ADOPTION OF FINANCIAL REPORTING STANDARDS (“FRSs”) (CONT’D)

The initial application of the above standards and IC Interpretations are not expected to have any material financial impacton the financial statements of the Group and of the Company.

The Group and the Company are exempted from disclosing the possible impact, if any, to the financial statements upon theinitial application of FRS 7 and FRS 139.

5. PRINCIPAL ACTIVITIES AND GENERAL INFORMATION

The principal activities of the Company are investment holding and the provision of management services. The principalactivities of its subsidiary companies and its associate companies are disclosed in Note 48 to the financial statements.There were no significant changes in the Group’s activities during the financial year other than the acquisition of subsidiarycompanies as disclosed in Note 43 to the financial statements.

The Company is a public limited liability company, incorporated and domiciled in Malaysia, and is listed on the Main Boardof Bursa Malaysia Securities Berhad. The registered office of the Company is located at No. 45-5, The Boulevard, MidValley City, Lingkaran Syed Putra, 59200 Kuala Lumpur. The principal place of business of the Company is located at Suite23.02, Level 23, The Gardens South Tower, Mid Valley City, Lingkaran Syed Putra, 59200 Kuala Lumpur.

The financial statements were authorised for issue by the Board of Directors in accordance with a resolution of the Directorson 19 October 2009.

6. PROPERTY, PLANT AND EQUIPMENTOffice

furniture,Land Plant fittings Capital

and and Motor and work Total Totalbuildings machinery vehicles Renovation equipment in progress 2009 2008

Group RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000CostAt beginning of

financial year 15,814 20,837 30,454 3,663 12,754 1,372 84,894 69,644Addition 5,974 19,984 4,301 2,186 3,194 - 35,639 16,933 Disposals - - (2,519) - (30) - (2,549) (2,071) Exchange differences - 142 1 6 30 - 179 648 Expensed off - - - - - - - (139) Reclassification from

other receivable - - - - - 588 588 - Reclassification to

investment properties - - - - - (1,960) (1,960) - Transfer - (38) - - 38 - - - Written off - - (133) - (420) - (553) (121)

At end of financial year 21,788 40,925 32,104 5,855 15,566 - 116,238 84,894

Accumulateddepreciation

At beginning offinancial year 2,288 11,207 13,398 1,624 9,854 - 38,371 32,965

Charge for thefinancial year 357 7,112 4,268 912 1,282 - 13,931 6,586

Disposals - - (2,292) - (17) - (2,309) (1,712)Exchange differences - 140 1 5 28 - 174 637Written off - - (38) - (418) - (456) (105)

At end of financial year 2,645 18,459 15,337 2,541 10,729 - 49,711 38,371

Net book value 2009 19,143 22,466 16,767 3,314 4,837 - 66,527 -

2008 13,526 9,630 17,056 2,039 2,900 1,372 - 46,523

Depreciation charged for the financial year ended 30 June 2008 290 1,361 3,651 460 824 - - 6,586

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

Analysis of land and buildings:-Short term

Freehold Freehold leasehold Total TotalGroup land building buildings 2009 2008

RM’000 RM’000 RM’000 RM’000 RM’000CostAt beginning of

financial year 1,530 12,290 1,994 15,814 15,805 Addition - - 5,974 5,974 9

At end of financial year 1,530 12,290 7,968 21,788 15,814

Accumulated depreciation

At beginning offinancial year - 2,208 80 2,288 1,998

Charge for the financial year - 246 111 357 290

At end of financial year - 2,454 191 2,645 2,288

Net book value 2009 1,530 9,836 7,777 19,143 -

2008 1,530 10,082 1,914 - 13,526

Depreciation charged for the financial year ended 30 June 2008 - 246 44 - 290

Motor Furniture Computer Office Total TotalCompany vehicle Renovation and fittings equipment equipment 2009 2008

RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000

CostAt beginning of

financial year 185 7 577 153 246 1,168 1,148Additions - - 26 40 7 73 20

At end of financial year 185 7 603 193 253 1,241 1,168


At beginning of financial year 139 4 473 104 163 883 783

Charge for the financial year 37 2 22 20 19 100 100

At end of financial year 176 6 495 124 182 983 883

Net book value 2009 9 1 108 69 71 258 -

2008 46 3 104 49 83 - 285

Depreciation charged for the financial year ended 30 June 2008 37 1 22 18 22 - 100

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

(a) The net book value of property, plant and equipment pledged to licensed banks for banking facilities granted to theGroup are as follows:-

Group Company2009 2008 2009 2008

RM’000 RM’000 RM’000 RM’000

Freehold land and buildings 11,366 11,612 - - Short term leasehold building 1,869 - - -

13,235 11,612 - -

(b) The net book value of property, plant and equipment acquired under hire purchase arrangements are as follows:-

Group Company2009 2008 2009 2008

RM’000 RM’000 RM’000 RM’000

Motor vehicles 13,963 16,161 9 46 Plant and machinery 1,991 - - -

15,954 16,161 9 46

7. PREPAID LAND LEASE PAYMENTSGroup

2009 2008RM’000 RM’000

CostAt beginning of financial year 607 607 Additions 4,378 -

At end of financial year 4,985 607

Accumulated amortisation

At beginning of financial year 24 11 Amortised during the financial year 68 13

At end of financial year 92 24

Net book value 4,893 583

Analysed as:- Short term leasehold land 4,893 583

Included in prepaid land lease payments is net book value of RM569,000 (2008: RM Nil) pledged to a licensed bank forbanking facilities granted to a subsidiary company.

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8. INVESTMENT PROPERTIES

LeaseholdLong term land and

Freehold leasehold buildingGroup Freehold land and land and under Total Total

land building buildings construction 2009 2008RM’000 RM’000 RM’000 RM’000 RM’000 RM’000

CostAt beginning of

financial year 5,277 18,717 16,554 10,693 51,241 59,478 Additions - 7,281 - - 7,281 1,280 Disposals - (5,270) - - (5,270) (8,502) Reclassification from

property, plant andequipment - - 1,960 - 1,960 -

Transfer to non-currentassets classified as held for sale - - - - - (1,574)

Exchange differences - 132 - - 132 559

At end of financial year 5,277 20,860 18,514 10,693 55,344 51,241


At beginning of financial year - 1,497 975 - 2,472 1,567

Charge for the financial year - 310 167 - 477 1,460

Disposals - (94) - - (94) (489) Transfer to non-current

assets classified asheld for sale - (5) - - (5) (66)

Exchange differences - 15 - - 15 -

At end of financial year - 1,723 1,142 - 2,865 2,472

Accumulated impairment losses

At beginning of financial year - - - - - 463 Allowance/(Writeback) for the

financial year - 984 - - 984 (329) Disposals - - - - - (155) Exchange differences - - - - - 21

At end of financial year - 984 - - 984 -

Net book value2009 5,277 18,153 17,372 10,693 51,495 -

2008 5,277 17,220 15,579 10,693 - 48,769

Depreciation charged for the financial year ended 30 June 2008 - 1,293 167 - - 1,460

Included in the cost of investment properties is interest expenses capitalised of RM231,000 (2008:RM 231,000).

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8. INVESTMENT PROPERTIES (CONT’D)

The net book value of investment properties pledged to licensed banks for banking facilities granted are as follows:-

Group Company2009 2008 2009 2008

RM’000 RM’000 RM’000 RM’000

Freehold land and buildings 17,618 17,406 - -Long term leasehold land and

buildings 15,412 15,579 - -

33,030 32,985 - -

9. LAND HELD FOR DEVELOPMENTGroup

2009 2008RM’000 RM’000

At beginning of financial yearLeasehold land, at cost 25,558 25,558 Development cost and incidental expenses 12,018 12,160

37,576 37,718

Development cost and incidental expenses charged to income statement during the financial year - (142)

At end of financial year Leasehold land, at cost 25,558 25,558 Development cost and incidental expenses 12,018 12,018

37,576 37,576

Included in development cost and incidental expenses is interest and financing cost of RM11,989,000 (2008 :RM11,989,000).

10. LONG TERM INVESTMENTSGroup Company

2009 2008 2009 2008RM’000 RM’000 RM’000 RM’000

Unquoted corporate bonds, at cost- in Malaysia 1,004 - - -- outside Malaysia 43,164 - - -Unquoted investment in Malaysia, at cost 1,585 1,585 - -Quoted securities, at cost- in Malaysia 37,895 39,923 - -- outside Malaysia 22,727 22,405 - -Other investments, at cost 2,104 3,169 345 345

108,479 67,082 345 345

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10. LONG TERM INVESTMENTS (CONT’D)Group Company

2009 2008 2009 2008RM’000 RM’000 RM’000 RM’000

Add/(Less): Accretion of discounts 206 - - -Amortisation of premiums (21) - - -Allowance for diminution in value (12,380) (11,415) - -Exchange differences 1,616 3,195 - -Accumulated amortisation (195) (159) - -

97,705 58,703 345 345

Market value of quoted securities- in Malaysia 37,895 39,521 - - - outside Malaysia 14,627 17,185 - -

52,522 56,706 - -

The investments in unquoted bonds outside Malaysia have been pledged to a licensed financial institution for bankingfacilities granted to a subsidiary company.

11. SUBSIDIARY COMPANIESCompany

2009 2008RM’000 RM’000

(a) Unquoted shares, at cost At beginning of financial year 262,469 322,469 Less: Capital reduction in a subsidiary company (Note 49) (80,000) (60,000) Accumulated impairment losses (41,380) (41,380)

141,089 221,089

The Company’s equity interest in subsidiary companies, their respective principal activities and countries ofincorporation are shown in Note 48 to the financial statements.

Company2009 2008

RM’000 RM’000

b) Amount due from subsidiary companies 653,665 538,061 Less: Allowance for doubtful debts (4,811) (4,811)

648,854 533,250

The amount due from/(to) subsidiary companies are interest bearing (except for certain advances which are interestfree) and have no fixed terms of repayment.

12. ASSOCIATE COMPANIESGroup Company

2009 2008 2009 2008RM’000 RM’000 RM’000 RM’000

(a) Unquoted shares, at cost 8,737 17,830 1,184 10,677Less: Group’s share of post

acquisition profits less losses and reserves 6,403 13,253 - -Transfer to non-current assets classified

as held for sale - (15,245) - (9,453)

15,140 15,838 1,184 1,224

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12. ASSOCIATE COMPANIES (CONT’D)

Group2009 2008

RM’000 RM’000Represented by :-

Share of net assets 13,773 14,471Goodwill on consolidation 1,367 1,367

15,140 15,838

The Group and the Company’s equity interest in the associate companies, their respective principal activities andcountries of incorporation are shown in Note 48 to the financial statements.

(b) The amount due from associate companies is interest free and have no fixed terms of repayment.

(c) The amount due to an associate company is interest bearing. The amount was repaid subsequent to the balance sheet date.

13. INTANGIBLE ASSETSStock broking Capitalised

dealer’s development Total Totallicense expenditure Trademarks 2009 2008

Group RM’000 RM’000 RM’000 RM’000 RM’000

Cost At beginning of financial year 45,500 144 71 45,715 45,685 Additions - 21 22 43 78 Transfer to inventories - - - - (48)

At end of financial year 45,500 165 93 45,758 45,715

Accumulated amortisation

At beginning of financial year 10,309 53 - 10,362 8,707Charge for the financial year 1,628 43 12 1,683 1,655

At end of financial year 11,937 96 12 12,045 10,362

Accumulated impairment losses

At beginning and end of financial year 12,400 - - 12,400 12,400

Net book value2009 21,163 69 81 21,313 -

2008 22,791 91 71 - 22,953

Impairment testing of stock broking dealer’s license

The stock broking dealer’s license had been allocated to the Kuala Lumpur branch of the stock broking subsidiary cashgenerating unit (“CGU”), a reportable segment for impairment testing. The recoverable amount of the Kuala Lumpur branchCGU has been determined based on value in use calculation using cash flow projections approved by the management ofthe stock broking subsidiary. The discount rate applied to the cash flow projections is 9%. The recoverable amount of theKuala Lumpur branch CGU is compared to the total carrying value of the dealers’ license.

Key assumptions used in value in use calculation of Kuala Lumpur Branch CGU

The key assumptions on which the management of the stock broking subsidiary has based its cash flow projections toundertake impairment testing of the stock broking dealer’s license are:

(i) Budgeted gross brokerage rate and gross margin rateThis is determined based on the CGU’s past performance and the management’s expectation for the market development.

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13. INTANGIBLE ASSETS (CONT’D)

(ii) Operational costsOther operational costs are expected to increase in line with expected inflation or expansion of the branch’s stockbroking business.

14. GOODWILLGroup

2009 2008RM’000 RM’000

At beginning of financial year 1,633 1,633 Less: Impairment loss during the financial year (1,449) -

At end of financial year 184 1,633

The goodwill represents the excess of the purchase consideration paid for the shares in the subsidiary companies over theGroup’s interest in the fair value of the identifiable net assets of the subsidiary companies acquired. For purposes ofimpairment testing, the carrying amount of goodwill is allocated to the Group’s respective cash generating units whichrepresents the lowest level within the Group at which the goodwill is monitored for internal management purposes.

The recoverable amount of the goodwill is based on value-in-use calculations, using pre-tax cash flow projections based onfinancial budgets covering a period of 5 years.

The key assumptions used in the value in use calculations are :

Revenue annual growth rate 10% to 20%Expenses annual increment rate 5% to 10%Pre-tax discount rate 9%

The above key assumptions were based on past performance and its expectations of future trends in the industry andexpected market developments. The discount rate used is pre-tax and reflect the risks relating to the cash generating unitsand is estimated based on the current market assessment of time-value of money. The key assumptions are sensitive tothe changes in percentage point in the discount rate used and future planned revenue not materialising.

The Directors do not expect any reasonable possible changes in key assumptions to have a significant impact on thecarrying value of goodwill to exceed its recoverable amount.

15. DEFERRED TAX ASSETS/(LIABILITIES)Group Company

2009 2008 2009 2008RM’000 RM’000 RM’000 RM’000

At beginning of financial year 3,218 4,170 - - Recognised in the income statement (Note 39) (2,624) (951) - - Exchange differences - (1) - -

At end of financial year 594 3,218 - -

Presented after appropriate offsetting as follows:-Group Company

2009 2008 2009 2008RM’000 RM’000 RM’000 RM’000

Deferred tax assets 1,570 3,992 - - Deferred tax liabilities (976) (774) - -

594 3,218 - -

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15. DEFERRED TAX ASSETS/(LIABILITIES) (CONT’D)

The components of deferred tax assets and liabilities during the financial year prior to offsetting are as follows:-

Deferred tax assetsGroup Company

2009 2008 2009 2008RM’000 RM’000 RM’000 RM’000

Unutilised tax losses 1,398 3,882 - - Unabsorbed capital allowances 156 97 - - Temporary differences between

depreciation and capital allowances 16 13 - -

1,570 3,992 - -

The unutilised tax losses and unabsorbed capital allowances are available for offset against future taxable profits. Theutilisation of the deferred tax assets is dependent on future taxable profits in excess of the profits arising from the reversalof existing taxable temporary differences.

Deferred tax liabilitiesGroup Company

2009 2008 2009 2008RM’000 RM’000 RM’000 RM’000

Temporary differences between depreciation and capital allowances (976) (774) - -

(976) (774) - -

As at balance sheet date, the Group and Company have deferred tax assets not recognised in the financial statements asfollows:-

Group Company2009 2008 2009 2008

RM’000 RM’000 RM’000 RM’000

Tax effect of:- - temporary differences between

depreciation and capital allowances 368 96 45 59

- unutilised tax losses (28,497) (31,040) - - - unabsorbed capital allowances (2,213) (2,178) - -

(30,342) (33,122) 45 59

The above unutilised tax losses and unabsorbed capital allowances are available for offset against future taxable profits.Deferred tax assets in respect of these items have not been recognised as it was not certain that future taxable profit willbe available against which the Group can utilise the benefits.

16. PROPERTY DEVELOPMENT COSTSGroup

2009 2008RM’000 RM’000

Freehold land, at cost 8,600 8,100 Leasehold land, at cost 10,000 10,000 Development and construction costs 46,445 20,162

At beginning of financial year 65,045 38,262

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16. PROPERTY DEVELOPMENT COSTS (CONT’D)Group

2009 2008RM’000 RM’000

Additions - Freehold land, at cost 317 500 - Development and construction costs 53,662 26,283

Costs incurred during the financial year 53,979 26,783

Freehold land, at cost 8,917 8,600 Leasehold land, at cost 10,000 10,000 Development and construction costs 100,107 46,445

119,024 65,045

Costs recognised as expense in income statement- in previous financial years (34,502) (8,690)- current financial year (42,224) (25,812)

At end of financial year 42,298 30,543

17. INVENTORIESGroup

2009 2008RM’000 RM’000

At cost,Terrace houses - 828 Consumables 23 23 Electronic, multimedia and computer devices,

components and peripherals 14,014 15,382 Wine 5,523 5,223

19,560 21,456

At net realisable value, Electronic, multimedia and computer devices,

components and peripherals 538 416 Wine 147 85

685 501

20,245 21,957

18. TRADE RECEIVABLESGroup

2009 2008RM’000 RM’000

Trade receivables 243,919 266,645Less: Allowance for doubtful debts (74,801) (62,096)

169,118 204,549

19. ACCRUED BILLINGSGroup

2009 2008RM’000 RM’000

Revenue recognised as income to-date 49,613 23,105Less: Progress billings to-date (40,011) (17,175)

9,602 5,930

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20. OTHER RECEIVABLES, DEPOSITS AND PREPAYMENTSGroup Company

2009 2008 2009 2008RM’000 RM’000 RM’000 RM’000

Sundry receivables 15,647 21,231 182 209 Deposits 19,491 12,385 9,853 9,020 Prepayments 1,443 1,187 26 -

36,581 34,803 10,061 9,229

21. SHORT TERM INVESTMENTSGroup

2009 2008RM’000 RM’000

Dual currency investments, at cost 39,435 - Unquoted corporate bonds outside Malaysia, at cost 19,847 -

59,282 -

Add/(Less): Accretion of discounts 12 -Allowance for diminution in value (90) -

59,204 -

The investments in unquoted bonds outside Malaysia have been pledged to licensed financial institutions for bankingfacilities granted to the Group.

22. MARKETABLE SECURITIESGroup

2009 2008RM’000 RM’000

Quoted securities, at cost- in Malaysia 60,412 69,211 - outside Malaysia 28,967 14,950

89,379 84,161 Add/(Less): Allowance for diminution in value (35,682) (33,661)Exchange differences (56) (34)

53,641 50,466

Market value of quoted shares - in Malaysia 35,694 40,440 - outside Malaysia 17,998 10,026

53,692 50,466

23. DEPOSITS WITH LICENSED BANKS AND FINANCIAL INSTITUTIONS Group Company

2009 2008 2009 2008RM’000 RM’000 RM’000 RM’000

Deposits placed with :-- licensed banks 288,356 172,923 - 1,687 - licensed financial institutions 142,255 203,852 24,004 -

430,611 376,775 24,004 1,687

Included under deposits with licensed banks and financial institutions are remisiers’ and dealers’ deposits and clients’ trustmonies received of RM182,528,000 (2008: RM171,118,000) and fixed deposits of RM45,124,000 (2008: RM10,397,000) whichhas been pledged to licensed banks as security for banking and credit facilities granted to the subsidiary companies of the Group.

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24. CASH AND BANK BALANCES

(a) Included in the cash and bank balances of the Group is an amount of RM2,930,000 (2008: RM7,149,000) whichrepresents remisiers’ and dealers’ deposits and clients’ trust monies received.

(b) Included in the cash and bank balances of the Group is an amount of RM3,150,000 (2008: RM1,426,000) maintainedpursuant to Section 7A of the Housing Development (Control and Licensing) Act, 1966 and are restricted from use inother operations. The withdrawal of the housing development account is restricted to property development costsincurred in respect of the development project.

(c) Included in cash and bank balances of the Group is an amount of RM70,000 (2008: RM70,000) pledged to a licensedbank for banking facilities granted to a subsidiary company.

25. NON-CURRENT ASSETS CLASSIFIED AS HELD FOR SALE

The non-current assets classified as held for sale are as follows:-Group Company

2009 2008 2009 2008RM’000 RM’000 RM’000 RM’000

Investment property At cost - 1,574 - - Less: Accumulated depreciation - (66) - -

- 1,508 - -

Associate company Unquoted shares, at cost - 9,453 - 9,453 Share of post acquisition profits

less losses and reserve - 5,792 - -

- 15,245 - 9,453

- 16,753 - 9,453

(a) On 14 April 2008, a wholly-owned subsidiary company entered into a Sale and Purchase Agreement with a third partyfor the disposal of its investment property.

The disposal was completed during the financial year.

(b) On 1 July 2008, the Company entered into a Conditional Sale and Purchase Agreement with a third party for thedisposal of its entire 20% equity interest in an associate company, Gleneagles Hospital (Kuala Lumpur) Sdn Bhd.

The disposal was completed during the financial year.

26. SHARE CAPITALGroup and Company

2009 2008RM’000 RM’000

Authorised:Ordinary shares of RM1 each 1,500,000 1,500,000

Issued and fully paid up: Ordinary shares of RM1 each At beginning of financial year 618,966 618,966Shares issued pursuant to conversion of ICULS

(Note 28) 74,368 -

At end of financial year 693,334 618,966

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27. RESERVESGroup Company

2009 2008 2009 2008RM’000 RM’000 RM’000 RM’000

Non-distributable: Reserve fund 1,200 1,200 - - Share premium 66,394 66,394 66,394 66,394 Exchange translation reserve 11,687 10,641 - - Distributable: Treasury shares, at cost (11,312) (10,132) (11,312) (10,132)

67,969 68,103 55,082 56,262

Reserve fund

The reserve fund is maintained in compliance with the provisions of the Rules of Bursa Malaysia Securities Berhad Relatingto Participating Organisations.

Treasury shares

The shareholders of the Company had by an ordinary resolution passed at the Annual General Meeting held on 15December 2008, approved the Company’s plan to purchase its own shares up to a maximum of 61,896,000 ordinary sharesof RM1 each representing approximately 10% of the total issued and fully paid up share capital of the Company on theBursa Malaysia Securities Berhad.

The Directors of the Company are of the opinion that the share buy-back is in the best interests of the Company and itsshareholders.

During the financial year, the Company bought back its issued ordinary shares from the open market as follows:-

No. of Total Purchase price per share2009 Shares Cost Highest Lowest Average

RM RM RM RM

At beginning of financial year 22,394,300 10,132,321 0.86 0.29 0.45 Purchases during the

financial year - October 2008 100,000 27,701 0.28 0.28 0.28 - December 2008 3,692,500 1,129,381 0.31 0.28 0.31 - January 2009 74,400 22,108 0.30 0.30 0.30 - April 2009 2,700 690 0.24 0.24 0.24

At end of financial year 26,263,900 11,312,201 0.86 0.24 0.43

The share buy-back transactions were financed by internal generated funds of the Group. The shares bought back arebeing held as treasury shares in accordance with the provision of Section 67A of the Companies Act, 1965.

28. 8% IRREDEEMABLE CONVERTIBLE UNSECURED LOAN STOCKS 1999/2009

Group Company2009 2008 2009 2008

RM’000 RM’000 RM’000 RM’000

ICULS 1999/2009 at nominal value of RM1.00 each 103,768 103,768 103,768 103,768 Less: ICULS purchased by the Group/Company (24,725) (24,725) (13,230) (13,230)

Gain arising from cancellation of ICULS (4,675) - (16,170) - Converted into ordinary shares in the Company (74,368) - (74,368) -

At end of financial year - 79,043 - 90,538

On 20 April 1999, the Company issued and allotted RM141,965,866 nominal amount of 8% Irredeemable ConvertibleUnsecured Loan Stocks 1999/2009 (“ICULS”) with 567,863,464 detachable Warrants on the basis of RM1 nominal amountof ICULS with 4 Warrants for every 4 existing ordinary shares of RM1 each held in the Company.

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28. 8% IRREDEEMABLE CONVERTIBLE UNSECURED LOAN STOCKS 1999/2009 (CONT’D)

The ICULS was reclassified as a component of equity in accordance with the provisions of FRS No. 132 FinancialInstruments: Disclosure and Presentation and the ICULS interest is treated as a distribution to the holders of the ICULS anddisclosed as a distribution of equity.

The ICULS was constituted by a Trust Deed dated 9 February 1999 between the Company and the Trustee for the holdersof the ICULS. The main features of the ICULS were as follows:-

(i) The ICULS shall be convertible into ordinary shares of the Company during the period from 20 April 1999 to thematurity date on 19 April 2009 at the rate of RM1.00 nominal value of ICULS for one new ordinary shares of RM1.00each in the Company.

(ii) Upon conversion of the ICULS into new ordinary shares in the Company, such shares shall rank pari passu in allrespects with the ordinary shares of the Company in issue at the time of conversion except that they shall not beentitled to any dividend or other distributions declared in respect of a financial period prior to the financial period inwhich the ICULS are converted or any interim dividend declared prior to the date of conversion of the ICULS.

(iii) Any ICULS outstanding at the expiry date on 19 April 2009 shall automatically be converted into fully paid ordinaryshares of RM1.00 each of the Company at the conversion price.

(iv ) The interest on the ICULS is payable semi-annually in arrears.

The Company’s Warrants was constituted by a Deed Poll dated 9 February 1999 between the Company and the holders ofthe Warrants.

The main features of the Warrants were as follows:-

(i) the exercise price for the Warrants is RM1.20 for each new ordinary share of RM1 each in the Company. The exerciseprice of the Warrants is subject to adjustments under certain circumstances in accordance with the provisions of theDeed Poll.

(ii) the exercise period for the Warrants shall commence from the date of issue of the Warrants and ends on 17 April 2009.Warrants not exercised during this period will lapse and will cease thereafter to be valid for any purpose.

(iii) the registered holder of the Warrants will have the rights at any time to subscribe for new ordinary shares of RM1 eachin the Company at the exercise price during the exercise period.

Pursuant to a Directors’ Resolution of the Company dated 25 June 2008, the Board of Directors of the Company hasapproved the cancellation of a total of RM29,400,700 nominal amount of ICULS held by the Group. The total ICULS thatremain in issue prior to the cancellation was RM103,767,866 nominal amount of ICULS. The aforesaid cancellation of theICULS was completed on 5 August 2008 and the total number of outstanding ICULS after the cancellation wasRM74,367,166 nominal amount of ICULS.

A notice dated 16 March 2009 was sent to the ICULS holders to inform them the balance of RM74,367,166 nominal amountof ICULS shall expire on 19 April 2009 and the ICULS holders who have not converted all or any part of his or her ICULSas at the expiry date will render the ICULS to be automatically converted into new ordinary shares of RM1 each of theCompany and the ICULS will be removed from the Official List of Bursa Malaysia Securities Berhad (“Bursa Securities”) on20 April 2009.

On 13 April 2009, a total of RM1,250 nominal amount of ICULS which were converted into new ordinary shares of RM1each of the Company, was granted listing and quotation on the Official List of Bursa Securities.

The remaining RM74,365,916 nominal amount of ICULS which were converted to new ordinary shares of RM1 each of theCompany upon its expiry, was granted listing and quotation on the Official List of Bursa Securities on 4 May 2009.

The warrants lapsed and ceased to be exercisable upon its expiry on 17 April 2009.

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29. LOANS AND BORROWINGSGroup Company

2009 2008 2009 2008RM’000 RM’000 RM’000 RM’000

Current – repayable within 1 financial yearBankers’ acceptances 425 - - - Bank overdraft 1,180 2,744 - - Term loans 72,654 7,944 - - Revolving credit facilities 6,000 1,000 4,000 -

80,259 11,688 4,000 -

Non-current – repayable after 1 financial year Term loans 3,314 4,930 - -

83,573 16,618 4,000 -

The revolving credit facility of the Company is secured against the following :(i) fixed charge over certain landed properties of the Group;(ii) a deed of assignment over certain landed properties of a subsidiary company; and(iii) assignment of rental proceeds from letting out of certain landed properties of the Group into an escrow account.

The loans and borrowings of the Group are secured against the following :(i) fixed charge over certain landed properties and development land of the Group;(ii) certain quoted and unquoted securities and fixed deposits of the Group; and (iii) corporate guarantee of the Company.

The effective interest rates per annum as at 30 June on the bank borrowings were as follows:

Group Company2009 2008 2009 2008

RM’000 RM’000 RM’000 RM’000

Bankers’ acceptances 3.60% - 3.62% - - - Bank overdraft 7.30% - 10.46% 7.58% - 10.73% - - Term loans 0.82% - 8.25% 5.45% - 8.25% - - Revolving credit facilities 4.35% - 5.84% 5.40% - 5.55% 4.58% - 5.84% -

30. HIRE PURCHASE PAYABLESGroup Company

2009 2008 2009 2008RM’000 RM’000 RM’000 RM’000

Payable within 1 financial year 4,297 3,964 8 32 Payable after 1 financial year but not later than 5 financial years 9,402 10,110 - 8

13,699 14,074 8 40 Less: Interest in suspense (1,756) (1,767) - (1)

Present value of hire purchase payables 11,943 12,307 8 39

Present value of hire purchase payables - within 1 financial year (Note 32) 3,711 3,467 8 31 - after 1 financial year but not later

than 5 financial years 8,232 8,840 - 8

11,943 12,307 8 39

The hire purchase payables within 1 financial year have been included under other payables and accruals.

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31. PROGRESS BILLINGSGroup

2009 2008RM’000 RM’000

Progress billings to-date 32,717 21,761Less: Revenue recognised as income to-date (32,654) (16,139)

63 5,622

32. OTHER PAYABLES AND ACCRUALS

The other payables and accruals consist of the followings:-Group Company

2009 2008 2009 2008RM’000 RM’000 RM’000 RM’000

Hire purchase payables (Note 30) 3,711 3,467 8 31 Accrued expenses 12,867 4,114 676 143 Deposits received 4,301 3,340 - - Accrued interest 362 4,168 29 4,145 Other payables 27,120 17,806 240 135

48,361 32,895 953 4,454

33. REVENUE

Significant categories of revenue recognised during the financial year are as follows:-

Group Company2009 2008 2009 2008

RM’000 RM’000 RM’000 RM’000Manufacture of electronic and telecommunication

products, parts and services 123,337 100,219 - - Property development revenue 43,023 29,299 - - Sale of goods and services 29,797 29,721 - - Interest income 15,542 16,270 - - Sale of marketable securities 12,906 39,338 - - Car rental 8,949 7,682 - -Brokerage commissions 3,368 8,852 - - Rental income from letting out of properties 2,204 2,015 - - Dividend income 241 7 1,700 5,220 Management fees - 97 696 2,009 Others 2,498 - - -

241,865 233,500 2,396 7,229

34. OTHER INCOME

Included in other income are amongst other items the followings:-Group Company

2009 2008 2009 2008RM’000 RM’000 RM’000 RM’000

Accretion of discounts on investments 218 - - - Gain on disposal of property, plant and equipment 515 270 - - Gain on disposal of investment properties 2,175 - - - Gain on exchange differences - realised 2,109 1,055 - - - unrealised 8,054 1,554 18 114 Gross dividends from investments - quoted in Malaysia 1,748 2,789 - - - quoted outside Malaysia 95 - - -

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34. OTHER INCOME (CONT’D)Group Company

2009 2008 2009 2008RM’000 RM’000 RM’000 RM’000

Interest received and receivable from - subsidiary companies - - 3,586 7,917 - others 6,723 7,011 4,245 2,130 Reversal of allowance for doubtful debts 190 40 - - Writeback of allowance for diminution in value of

marketable securities 6,049 1,553 - -

35. ADMINISTRATION EXPENSES

Included in administration expenses are amongst other items the followings:-

Group Company2009 2008 2009 2008

RM’000 RM’000 RM’000 RM’000Auditors’ remuneration:- SJ Grant Thornton Statutory audit fees - current financial year 166 116 20 20 - underprovision in prior financial years 27 35 - 2 Special audits - current financial year 21 - 20 - Other external auditors Statutory audit fees - current financial year 63 68 - - - underprovision in prior financial years 3 3 - - Depreciation of property, plant and equipment 540 243 100 100 Lease rental payable to a subsidiary company - - 107 282 Loss on divestment of interest in an associate company - 29 - - Loss on exchange differences- realised 176 1 132 -- unrealised 303 - - -Loss on disposal of property, plant and equipment 3 - - - Preliminary expenses written off - 3 - - Rental of premises 779 478 50 -

36. OTHER OPERATING EXPENSES

Included in other operating expenses are amongst other items the followings:-

Group Company2009 2008 2009 2008

RM’000 RM’000 RM’000 RM’000

Amortisation of development expenditure 43 27 - - Allowance for diminution in value of marketable securities 8,039 7,431 - - Allowance for diminution in value of short term investment 90 - - - Allowance for obsolete inventories 386 - - - Allowance for slow moving inventories - 419 - - Allowance for doubtful debts 12,843 6,426 - - Amortisation of intangible assets 1,640 1,628 - - Amortisation of long term investment 22 20 - - Amortisation of premium on long term investment 21 - - - Amortisation of prepaid land lease payments 68 13 - - Auditors’ remuneration:- Other external auditors Statutory audit fees - current financial year 50 46 - -

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36. OTHER OPERATING EXPENSES (CONT’D)Group Company

2009 2008 2009 2008RM’000 RM’000 RM’000 RM’000

Bad debts written off 1 40 - - Depreciation - property, plant and equipment 13,391 6,343 - - - investment properties 477 1,460 - - Hire of equipment 447 507 - - Impairment loss on goodwill 1,449 - - - Impairment loss on investment properties 984 - - - Inventories written off 4 - - - Long term investment written off 1,956 - - -Loss on exchange differences - realised 572 2,018 - - - unrealised 2,973 4,713 - - Loss on disposal of property, plant and equipment - 3 - - Property, plant and equipment written off 97 16 - - Rental of motor vehicle 86 131 - - Rental of premises 50 271 - -

37. FINANCE COSTS

Finance costs comprise of the following expenses:-Group Company

2009 2008 2009 2008RM’000 RM’000 RM’000 RM’000

Interest expenses- subsidiary companies - - 759 761- an associate company 83 - 83 -- interest on loan and bankers’ acceptance facilities 2,258 2,175 - -- bank overdraft interest 185 288 - -- revolving credit facilities 380 28 109 -- minority shareholders’ advances 44 50 - -- hire purchase interest 542 466 1 3

3,492 3,007 952 764

The ICULS were classified as part of equity in accordance with the provisions of FRS 132 Financial Instruments: Disclosureand Presentation. The payment of ICULS interest of RM4,767,000 (2008:RM8,313,000) at the Company and Group levelare disclosed as a distribution of equity as set out in the Statement of Changes in Equity.

38. EXCEPTIONAL ITEMSGroup Company

2009 2008 2009 2008RM’000 RM’000 RM’000 RM’000

Gain on disposal of associate companies 56,782 - 62,346 - Gain on disposal of investment properties 364 780 - - Allowance for diminution in value

of long term quoted investments (844) (2,812) - - Reversal of impairment loss on

investment property - 329 - -

56,302 (1,703) 62,346 -

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39. TAXATIONGroup Company

2009 2008 2009 2008RM’000 RM’000 RM’000 RM’000

Income tax : Provision for current financial year - Malaysia income tax 1,070 1,389 113 1,097 - Overseas income tax 230 207 - - Under/(Over)provision in previous financial years 112 (202) (559) -

Deferred tax : Transfer from deferred taxation (Note 15) 2,624 951 - -

4,036 2,345 (446) 1,097

The reconciliation of income tax expenses on profit before taxation with the applicable statutory income tax rate is asfollows:-

Group Company2009 2008 2009 2008

RM’000 RM’000 RM’000 RM’000


Income tax at the Malaysian statutory tax rate of 25% (2008:26%) 15,283 6,017 16,618 3,071

Tax effect in respect of :

Allowable expenses - ICULS interest paid taken direct to reserve (1,192) (2,161) (1,192) (2,161)

Double deduction of expenses (9) (28) - - Non-allowable expenses 2,054 1,716 50 447 Income not subject to tax (14,793) (4,182) (15,837) (260) Effect of income subject to the tax rate of

20% for small – medium enterprises - 770 - -Effect of different tax rates in other countries 526 (139) - - Overseas tax paid for dividend income 169 181 - - Tax savings from utilisation of capital allowances (554) (687) - - Tax savings from utilisation of tax losses (3,976) (2,513) - - Deferred taxation not recognised in the financial statements 6,416 3,573 474 -

Tax expenses for current financial year 3,924 2,547 113 1,097 Under/(over)provision for taxation in previous

financial years 112 (202) (559) -

Tax expense for the financial year 4,036 2,345 (446) 1,097

Unutilised tax losses carried forward subject to agreement of the tax authorities 119,581 134,316 - -

Unabsorbed capital allowances carried forward subject to agreement of the tax authorities 9,475 8,753 - -

The Malaysian Budget 2008 introduced a single tier income tax system with effect from year of assessment 2008.Companies without Section 108 tax credit will automatically move to the new single tier dividend system on 1 January 2008whilst companies with such credit are given an irrevocable option to elect for a switch to the new system during thetransitional period of six years. All the companies will be in the new system on 1 January 2014. Under the new system,tax on profits of companies is a final tax and dividend distributed will be exempted from tax in the hands of shareholders.

The Company has available Section 108 tax credit and has not opt to switch over to the single tier system. The Companymay use the available S108 tax credit for purpose of dividend distribution during the transitional period of six years.

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40. EARNINGS PER SHARE

(a) Basic earnings per share

Earnings per share for the financial year has been calculated based on the Group’s profit for the financial yearattributable to the equity holders of the Company of RM51,905,000 (2008 : RM16,566,000) divided by the weightedaverage number of ordinary shares in issue during the financial year of 612,897,000 shares (2008 : 597,618,000shares), after taking into consideration the movement of shares bought back by the Company.

(b) Diluted earnings per share

No diluted earnings per share is calculated for the financial year as there is no dilutive potential on the ordinary sharesof the Company as at year end pursuant to the completion of the conversion of the ICULS into ordinary shares prior tothe ICULS’s expiry on 19 April 2009.

Diluted earnings per share for the previous financial year is calculated based on the Group’s profit for the previous financialyear attributable to the equity holders of the Company of RM16,566,000 divided by the adjusted weighted average numberof ordinary shares in issue in the previous financial year of 701,386,000 which assumed the conversion of 103,767,866nominal amount of 8% ICULS into ordinary shares at the beginning of the previous financial year.

41. DIRECTORS’ REMUNERATION

The aggregate remuneration paid or payable to the Directors of the Company, categorised into the appropriate componentsfor the financial year are as follows:

Group Company2009 2008 2009 2008

RM’000 RM’000 RM’000 RM’000

Executive Directors:- Salaries and other emoluments 2,172 2,115 570 720 Defined contribution plan 123 146 68 86 Fees 177 36 - - Benefits-in-kind 70 84 70 58

2,542 2,381 708 864

Non-Executive Directors:- Salaries and other emoluments 82 36 36 36 Defined contribution plan 10 4 4 4 Fees 72 72 72 72 Benefits-in-kind 20 16 20 16

184 128 132 128

2,726 2,509 840 992

42. STAFF COSTS

Group Company2009 2008 2009 2008

RM’000 RM’000 RM’000 RM’000

Salaries, wages and allowances 36,801 27,027 3,326 3,091 Social security cost 259 214 19 18 Defined contribution plan 2,413 2,198 308 344 Other staff related expenses 98 545 - -

39,571 29,984 3,653 3,453

Included in staff cost of the Group and the Company are executive and non-executive directors’ remuneration amounting toRM2,636,000 (2008 : RM2,409,000) and RM750,000 (2008 : RM918,000) respectively as disclosed in Note 41 to thefinancial statements.

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43. INFORMATION ON THE ACQUISITION OF SUBSIDIARY COMPANIES DURING THE FINANCIAL YEAR ANDSUMMARY EFFECT OF ACQUISITION OF SUBSIDIARY COMPANIES

(a) Details of the subsidiary company acquired by the Group during the financial year are as follows:-

(i) Insas Technology Berhad, a wholly-owned subsidiary company, had on 21 July 2008 acquired two (2) ordinaryshares of RM1 each, representing 100% equity interest in Simfoni Bistari Sdn Bhd (“Simfoni”) for a cashconsideration of RM2. Simfoni was incorporated on 18 February 2003 as a private limited company under theCompanies Act, 1965. Simfoni was a dormant company when acquired. Subsequent to the acquisition, Simfonicommenced operations and its principal activities are in the investment holding and letting out of properties.

(ii) On 13 March 2009, the Company acquired two (2) ordinary shares of RM1 each, representing 100% equity interestin Insas Mobile Sdn Bhd (“Insas Mobile”) (formerly known as Magna Saujana Sdn Bhd) for a cash consideration ofRM2. Insas Mobile was incorporated on 7 June 2005 as a private limited company under the Companies Act, 1965.Insas Mobile is a dormant company and has not commenced operations since its incorporation.

(iii) In the previous financial year, Dawnfield Pte Ltd, an indirect wholly-owned subsidiary company, incorporated thefollowing subsidiary company which details are as follows:-

Name of company % Effective equity interest Principal activitiesCellar-1 (S) Pte Ltd 100 Trading of alcoholic and

non-alcoholic beverages

(b) The effect of the acquisition of Simfoni and Insas Mobile (2008: Acquisition of Cellar-1 (S) Pte Ltd) on the financialresults of the Group during the financial year were as follows:-

Group2009 2008

RM’000 RM’000

Revenue - - Cost of sales (92) -

Gross loss (92) - Other income 2 - Administration expenses (14) (5) Other operating expenses (181) -

Loss before taxation (285) (5)

(c) The effect of the acquisition of Simfoni and Insas Mobile (2008: Acquisition of Cellar-1 (S) Pte Ltd) on the financialposition of the Group as at the end of the financial year were as follows:-

Group2009 2008

RM’000 RM’000

Property, plant and equipment 7,681 - Prepaid land lease payments 3,115 - Other receivables, deposits and prepayments 5 - Cash and bank balances 2 - Trade payables (26) - Other payables and accruals (222) (5)

Group’s share of net assets/(liabilities) 10,555 (5)

(d) The details of net assets acquired, goodwill and cash flow as at the date of acquisition arising from the acquisition ofSimfoni and Insas Mobile (2008 : Acquisition of Cellar-1 (S) Pte Ltd) were as follows:-

Group2009 2008

RM’000 RM’000

Purchase consideration * - Less: Cash and bank balances acquired # -

Net cash acquired on acquisition of equity interest in subsidiary companies - -

* represents RM4# represents RM(4)

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44. CONTINGENT LIABILITIESGroup Company

2009 2008 2009 2008RM’000 RM’000 RM’000 RM’000

Unsecured :-Guarantees to secure banking and

credit facilities of subsidiary companies - - 49,900 87,679 Invoices under dispute 178 178 - -

178 178 49,900 87,679

The Directors are of the opinion that the above contingent liabilities of the Group and of the Company will not crystallise.

45. COMMITMENTSGroup

2009 2008RM’000 RM’000

Authorised and contracted for - Acquisition of investment properties 1,050 1,050 - Acquisition of property, plant and equipment 875 2,263 - Acquisition of investments 28,384 22,019

30,309 25,332

46. SEGMENTAL REPORTING – GROUP

(a) Primary Segmental Reporting - Business Segments

Financial Property Investment Retail Informationservices investment holding trading technology

and credit and and and related& leasing development trading car rental services Eliminations Group

2009 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000Revenue

External revenue 17,862 44,758 25,982 9,336 143,927 - 241,865

Inter-segment revenue 5,888 4,222 2,913 538 12,239 (25,800) -

Total segment revenue 23,750 48,980 28,895 9,874 156,166 (25,800) 241,865

ResultsSegment (loss)/profit

from operations (9,555) 2,316 (2,873) 844 13,111 (1,959) 1,884

Interest income 6,723

Finance costs (3,492)

Share of profits less losses of associate companies - - 938 (1,222) - - (284)

Exceptional items - 364 55,938 - - - 56,302

Profit before taxation 61,133

Taxation (4,036)

Profit after taxation 57,097

Minority interests (5,192)

Net profit attributableto equity holders of the Company 51,905

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46. SEGMENTAL REPORTING – GROUP (CONT’D)

(a) Primary Segmental Reporting - Business Segments (cont’d)


and credit and and and related& leasing development trading car rental services Group

2009 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000Other information

Segment assets 522,492 139,513 336,435 25,158 107,928 1,131,526Share of net assets of

associate companies - - 2,677 17,224 - 19,901Tax assets 4,214 407 1,187 30 98 5,936Unallocated corporateassets 184

Total assets 1,157,547

Segment liabilities 197,480 25,191 80,847 12,532 45,229 361,279Tax liabilities 412 - - - 789 1,201

Total liabilities 362,480

Capital expenditure onproperty, plant andequipment 141 - 206 4,174 31,118 35,639

Depreciation 486 347 689 4,066 8,820 14,408

Amortisation 1,650 - 21 - 123 1,794

Non cash expensesother than depreciation and amortisation 14,649 - 11,947 403 1,677 28,676



2008 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000

Revenue External revenue 24,019 33,167 42,018 8,173 126,123 - 233,500

Inter-segment revenue 2,014 4,121 7,721 1,346 5,944 (21,146) -

Total segment revenue 26,033 37,288 49,739 9,519 132,067 (21,146) 233,500

Results Segment profit/(loss) from operations 10,200 8,331 (13,458) 1,152 13,457 (1,974) 17,708

Interest income 7,011

Finance costs (3,007)

Share of profits less losses of associate companies - - 2,878 257 - - 3,135

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2008 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000

Results (cont’d)Exceptional items - 780 (2,483) - - - (1,703)

Profit before taxation 23,144

Taxation (2,345)

Profit after taxation 20,799

Minority interests (4,233)

Net profit attributable to equity holders of the Company 16,566


and credit and and and related& leasing development trading car rental services Group

2008 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000

Other informationSegment assets 562,937 135,048 171,674 24,384 72,046 966,089 Share of net assets of

associate companies - - 16,093 18,406 - 34,499 Tax assets 6,916 141 6,549 125 81 13,812 Unallocated corporate

assets 1,633

Total assets 1,016,033

Segment liabilities 197,194 23,944 10,310 14,342 22,248 268,038 Tax liabilities 454 54 - - 1,000 1,508

Total liabilities 269,546

Capital expenditure on property, plant and equipment 174 1,443 20 7,496 7,800 16,933

Depreciation 713 423 1,563 3,368 1,979 8,046

Amortisation 1,628 - - - 40 1,668

Non cash expenses other than depreciation and amortisation 8,606 16 10,664 127 4,681 24,094

Segmental information is presented in respect of the Group’s business segments. The primary format, businesssegments, is based on the Group’s management and internal reporting structure.

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Segment assets consist primarily of property, plant and equipment, prepaid land lease payments, investmentproperties, land held for development, long term investments, associate companies, intangible asset, marketablesecurities, property development costs, inventories, receivables and operating cash and deposits at bank butexclude tax assets, which is disclosed separately. Unallocated corporate asset consists of goodwill on consolidation.Segment liabilities comprise operating liabilities but exclude tax liabilities, which is disclosed separately.

Capital expenditure comprises additions to property, plant and equipment during the financial year.

Segment revenue, expenses and results also include transfers between segments. The prices charged on intersegment transactions are on arms length basis under terms and conditions not materially different from transactionswith unrelated parties. These transactions are eliminated on consolidation.

The Group is organised into five main business segments. The main business segments of the Group and theirrespective business activities are :-

Business segment Business activities

Financial services and credit & leasing Stockbroking and dealing in securities, credit and leasing and grantingof loans and other related financing activities, provision of shareregistration services, management services and nominee agents.

Property investment and development Property holding and investment, project management and propertymanagement and development.

Investment holding and trading Investment holding and trading of shares and other related financialinstruments.

Retail trading and car rental Retail and trading of high fashion wear, leather goods and otherlifestyle-related products, wine merchants, operating food andbeverages outlets and car rental services.

Information technology related services Design, manufacturing, distribution and sales of smartcards, semi-conductor products and equipment, produce wireless microwavetelecommunication products, wireless broadcast card andelectronic manufacturing services, manufacture and distribution ofcomputer peripherals, design and development of software andweb applications and provision of communication and networkingservices, provision of sales and services for mobile wireless andfixed line broadband solutions and devices and relatedperipherals, provision of voice call, data and multimedia productsand services, provision of secure payment gateway services for e-commerce community, computer hardware dealers andmaintenance, sale of multimedia and electronic products and ITconsultancy services.

(b) Secondary Segmental Reporting - Geographical SegmentCarrying Additions

Amount of to Property,Segment Plant and

Revenue Assets Equipment RM’000 RM’000 RM’000

2009 Malaysia 212,463 872,927 35,475Overseas 29,402 284,620 164

241,865 1,157,547 35,639

2008 Malaysia 182,100 839,288 16,826 Overseas 51,400 176,745 107

233,500 1,016,033 16,933

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47. SIGNIFICANT RELATED PARTY TRANSACTIONS

(a) The Group has the following transactions with the following related parties during the financial year:-

Group2009 2008

RM’000 RM’000

Design and printing costs paid to Catalyst Creatives, a firmrelated to a Director of the Company 136 146

Fees charged by/(charged to) Syarikat Agensi Pekerjaan ER Services Sdn Bhd, a company related to certain Directors of the Company:- - recruitment and human resources administration services fees 124 106- secretarial fees (1) (1) - rental of office premises (9) (9)

Purchases from/(Sales to) Vanskee Enterprise (S) Pte Ltd, a company related to certain directors and a minority shareholder of a subsidiary company:- - purchase of raw material 22 71 - sale of goods and services (37) (19) - purchase of property, plant and equipment - 5

Purchases of raw material from Vanskee Enterprise Co. Ltd., a company relatedto certain directors and a minority shareholder of a subsidiary company 461 412

Professional fees paid to Shearn Delamore & Co., a legal firm in which a Director of the Company is a partner - 15

(Services provided to)/Cost payable to Ceedtec Sdn Bhd, a company related to a director and a minority shareholder of a subsidiary company - Sale of goods and services (301) (7) - Research cost paid/payable - 33 - Royalty expense paid/payable 44 13

Renovation and maintenance works provided to companies, which related to a Director of the Company - Immobillaire Holdings Sdn Bhd 28 29 - Baktihan Sdn Bhd 15 2

Sale of wine by a subsidiary company to a director of a subsidiary company 32 -

Interest expense paid/payable to minority shareholders of a subsidiary company 44 50

(b) The Company has the following transactions with the following related parties during the financial year:-

Company2009 2008

RM’000 RM’000

Management fees charged to subsidiary companies* 696 2,009

Dividends received from subsidiary companies:- - M & A Securities Sdn Bhd - 4,220 - Insas Technology Berhad 700 -

Dividend received from Gleneagles Hospital (Kuala Lumpur) Sdn Bhd, an associate company 1,000 1,000

Interest expenses paid/payable to M & A Securities Sdn Bhd, a subsidiary company 759 761

Interest expenses paid/payable to Brickfield Properties Pty Ltd, an associate company 83 -

Lease rental paid/payable to Insas Pacific Rent-A-Car Sdn Bhd, a subsidiary company 107 282

Interest charged to subsidiary companies* 3,585 7,917

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47. SIGNIFICANT RELATED PARTY TRANSACTIONS (CONT’D)

(b) (cont’d)

The Directors are of the opinion that the above transactions were entered into in the normal course of business andhave been established on a negotiated basis under terms and conditions that are not materially different from thatobtained in transactions with third parties.

* The transactions are disclosed in aggregate as it is immaterial to disclose individually.

(c) Remuneration of Key Management Personnel

The remuneration of directors and other members of key management during the financial year was as follows:-

Group Company2009 2008 2009 2008

RM’000 RM’000 RM’000 RM’000

Salaries, allowances and bonus 5,206 4,003 570 720 Defined contribution plan 393 338 68 86 Fees 213 72 - - Social security cost 10 11 - - Benefits-in-kind 70 84 70 58

5,892 4,508 708 864

Included in the total compensation of key management personnel were:-

Group Company2009 2008 2009 2008

RM’000 RM’000 RM’000 RM’000

Directors’ remuneration (Note 41) 2,542 2,381 708 864

Other members of key management personnel comprise persons other than the Directors of the Group and of theCompany, having authority and responsibility for planning, directing and controlling the activities of the Group eitherdirectly or indirectly.

48. LIST OF SUBSIDIARY AND ASSOCIATE COMPANIES

% Effectiveequity interest Country of

Name of company 2009 2008 Principal activities incorporation

SUBSIDIARY COMPANIES:

Cellar-One Sdn Bhd 100 100 Wine merchant Malaysia

Cellar-1 (S) Pte Ltd * 100 100 General trading including Singapore trading of alcoholic and non-alcoholic beverages

Contibina Sdn Bhd 60 60 Investment holding Malaysia

Dawnfield Pte Ltd * 100 100 Investment holding, Singapore investment trading and investment and rental of properties

Dellmax Worldwide Sdn Bhd 58.5 58.5 Investment holding Malaysia

Delta Crest Sdn Bhd* 100 100 Property investment Malaysia

Desa Juara Sdn Bhd 100 100 Property development Malaysia

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48. LIST OF SUBSIDIARY AND ASSOCIATE COMPANIES (CONT’D)




Filmont Development 100 100 Investment holding, MalaysiaSdn Bhd property development and

project management

Gryphon Asset 66 66 Fund management and Malaysia Management Sdn Bhd investment holding

Hastanas Development 65.3 65.3 Property development Malaysia Sdn Bhd

Inari Technology Sdn Bhd 51 51 Produce wireless microwave Malaysia telecommunication products,wireless broadcast card andto provide electronic manufacturing services

Insas Construction Sdn Bhd 100 100 Construction, landscaping, Malaysiarenovation and other related works

Insas Corporate Services 100 100 Provision of management MalaysiaSdn Bhd services and investment

holding

Insas Credit & Leasing 100 100 Credit, leasing and other Malaysia Sdn Bhd related financing activities

Insas Mobile Sdn Bhd 100 - Dormant Malaysia (formerly known as MagnaSaujana Sdn Bhd)

Insas Plaza Sdn Bhd 100 100 Investment holding, Malaysia investment trading and property trading/property investment

Insas Project Management 100 100 Property and project MalaysiaSdn Bhd management and consultants

Insas Properties Sdn Bhd 90 90 Investment holding and Malaysia property investment

Insas Property Management 90 90 Property and project Malaysia Sdn Bhd management

Insas Technology Berhad 100 100 Investment holding and Malaysia provision of information technology consultancy services, provision of management services andtrading of electronic andtelecommunications related products

Insas Technology Pte Ltd * 100 100 Investment holding Singapore

INSAS






Insas Pacific Rent-A-Car 100 100 Car rental services Malaysia Sdn Bhd

Jia Sdn Bhd (formerly 100 100 Restaurant operator Malaysia known as Success Crest Sdn Bhd)

Langdale E3 Pte Ltd * 100 100 Provide telecommunication Singaporeservices such as voice over internet protocol (VOIP) services, electronic components sourcing and distribution and sale ofrouters and modemsfor wireless broadband network

Langdale Systems Sdn Bhd 100 100 Computer trading and Malaysiasoftware consultation

Lifestyle-One Sdn Bhd 100 100 Investment holding Malaysia

M & A Futures Sdn Bhd 100 100 Futures broking Malaysia

M & A Financial Services 100 100 Investment holding and British VirginInc. provision of credit and Islands

related financing activities

M & A Nominee (Asing) 100 100 Nominee agent and MalaysiaSdn Bhd * registration services

M & A Nominee 100 100 Nominee agent and Malaysia (Tempatan) Sdn Bhd * registration services

M & A Research 100 100 Management and investment MalaysiaSdn Bhd research services

M & A Securities 100 100 Stockbroking Malaysia Sdn Bhd *

M & A Securities (HK) 93 93 Stockbroking Hong KongLimited * (Temporary ceased operations)

Magxo Sdn Bhd 100 100 Mobile virtual network Malaysia operations

Megapolitan Nominees 100 100 Nominee agent and Malaysia(Tempatan) Sdn Bhd Registration services

Megapolitan Management 100 100 Provision of corporate MalaysiaServices Sdn Bhd secretarial, share

registration and management services

Media Lang Limited* 100 100 Sale of multimedia and Hong Kong electronic products

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Montania Development 100 100 Property investment Malaysia Sdn Bhd

Micromodule Pte Ltd * 52.4 52.4 Design, manufacture, Singapore distribute, sales, maintenance and other supporting activities related to manufacture of equipment, sub assemblies, semi and finished products for all types of semiconductor products and equipment

Montego Assets Limited 100 100 Investment holding and British Virgintrading Islands

Noble Builders Sdn Bhd 75 75 Property investment and Malaysiatheme restaurant (Inactive)

Pan Asian Assets Inc. 100 100 Investment trading British VirginIslands

Parkfair Development 63 63 Investment holding Malaysia Sdn Bhd

Premium-One Sdn Bhd 100 100 Restaurant operator Malaysia (Ceased operations)

Premium Parking Sdn Bhd 100 100 Car park management Malaysia (Temporary ceasedoperations)

Premium Yield Sdn Bhd 65.3 65.3 Investment holding Malaysia

Segar Raya Development 60.3 60.3 Real property and Malaysia Sdn Bhd housing developer

Simfoni Bistari Sdn Bhd 100 - Investment holding and Malaysia property investment

Southgroup Investments 100 100 Investment holding Hong Kong Limited *

Teraju Usaha Sdn Bhd 100 100 Provision of consultancy and Malaysiaadvisory services and commission agent

Topacres Sdn Bhd 100 100 Investment holding Malaysia

True Blue Sdn Bhd 100 100 Investment holding Malaysia

Valencia Homes Sdn Bhd 90 90 Property development Malaysia

Vigcashlimited LLC 100 100 Provision of secure Mongolia payment gateway servicesfor e-commerce communities

INSAS






VigSys Sdn Bhd 100 100 Manufacture and distribution Malaysia of mobile wireless and fixedline broadband solution, devices and related peripherals

VigTech Labs Sdn Bhd 100 100 Design and development of Malaysiasoftware and webapplications and provision of communication and networking services

Xotapoint Sdn Bhd 100 100 Engaged in the provision of Malaysiasales and services for mobile wireless and fixedline broadband solutions and devices and relatedperipherals, provision ofvoice call, data and multimedia products andservices and provision ofsmartcard software andsystem integration

Xota Communications 100 100 Provision of information Malaysia Sdn Bhd technology consultancy

services, provision of voicecall services and trading in all related products

ASSOCIATE COMPANIES :

Brickfields Properties 25 25 Property development AustraliaPty Ltd* (Ceased operations)

Centreplus Sdn Bhd 35 35 Improving and leasing of Malaysialanded property

Diffusion Fashions Sdn Bhd 43.4 43.4 Dormant Malaysia

Dome Cafe Sdn Bhd 43.4 43.4 Restaurant operator Malaysia

Gleneagles Hospital(Kuala Lumpur) Sdn Bhd* - 20 Hospital and medical services Malaysia

Gleneagles Medical 20 20 Development and investment Malaysia Centre (Kuala Lumpur) in medical centers Sdn Bhd *

Gleneagles Academy of - 20 Academy for training of Malaysia Nursing (M) Sdn Bhd* nursing care

Good-Life Foods Sdn Bhd 43.4 43.4 Restaurant operator Malaysia

Island Cafe Sdn Bhd 36 36 Restaurant operator Malaysia

Lifestyle Foods Sdn Bhd 37.7 37.7 Food and beverage Malaysia Restaurant

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ASSOCIATE COMPANIES :

Melium Holdings Sdn Bhd 43.4 43.4 Investment holding Malaysia

Melium Sdn Bhd 43.4 43.4 Retailer of high fashion Malaysia products

Melium Aseana Sdn Bhd 22.1 22.1 Retailer of Asian made Malaysia products

Melium Aseana Pte Ltd * - 22.1 Company struck off during Singapore the financial year

Roset Limousines 41 41 Provision of premium Singapore Services Pte Ltd* limousines services

Winfields Development 40 - Investment holding and Malaysia Sdn Bhd rental of properties

* Companies not audited by SJ Grant Thornton.

49. SIGNIFICANT EVENTS DURING THE FINANCIAL YEAR

(i) On 1 July 2008, the Company entered into a conditional Sale and Purchase Agreement (“SPA”) with Tan & TanDevelopments Berhad (“TTDB”) and Pantai Irama Ventures Sdn Bhd (“PIVSB”) for the Company to, together withTTDB, dispose their collective 50% equity in Gleneagles Hospital (Kuala Lumpur) Sdn Bhd (“GH”) to PIVSB for atotal consideration of RM171,630,000, subject to revision based on the debt and cash position of GH on thecompletion date.

Of the collective 50%, the Company’s equity interest in GH is 20% comprising of 4,225,000 ordinary shares of RM1each and 5,100,000 redeemable preference shares of RM0.05 each.

PIVSB is a private limited company incorporated in Malaysia and a subsidiary company of Khazanah Nasional Berhad.

TTDB is a public limited company incorporated in Malaysia and a wholly-owned subsidiary of IGB Corporation Berhad.

On 19 November 2008, the Company announced that it has completed the disposal of its 20% equity interest in GHfor a cash consideration of RM71.78 million. Accordingly, GH has ceased to be an associate company of the Company.

(ii) On 7 August 2008, M & A Securities Sdn Bhd (“M & A Securities”), a wholly-owned subsidiary company, passed aspecial resolution in an Extraordinary General Meeting for its shareholders’ approval for a proposed capitalreduction of its paid up share capital (“Proposed Capital Reduction”).

The Proposed Capital Reduction will reduce the fully paid up share capital of M & A Securities from RM140 milliondivided into 140 million ordinary shares of RM1 each to RM60 million divided into 60 million ordinary shares of RM1each by cancellation of 80 million fully paid ordinary shares of RM1 each subject to the confirmation of the HighCourt of Malaya pursuant to Section 64 of the Companies Act, 1965, provisions of Article 34 of M & A Securities’Articles of Association and approval of Bursa Malaysia Securities Berhad, Securities Commission and all relevantauthorities. The Proposed Capital Reduction shall be effected by distributing in cash to all the entitled shareholders.

On 12 December 2008, the High Court of Malaya granted an order reducing the issued and paid up share capital ofM & A Securities as petitioned.

Subsequently on 6 January 2009, a Certificate of Lodgement of Order of High Court Confirming Reduction of ShareCapital was issued by the Companies Commission of Malaysia as confirmation that the Order of the High Count hasbeen duly lodged in accordance with Section 64 of the Companies Act, 1965.

The Proposed Capital Reduction has been completed during the financial year.

INSAS


49. SIGNIFICANT EVENTS DURING THE FINANCIAL YEAR (CONT’D)

(iii) On 23 October 2008, the Company announced that Topacres Sdn Bhd (“Topacres”), a wholly-owned subsidiarycompany, had subscribed for 40,000 ordinary shares of RM1 each, representing 40% of the total issued and paidup share capital of Winfields Development Sdn Bhd (“Winfields”). On 23 January 2009, Topacres subscribed for afurther 360,000 ordinary shares of RM1 each representing 40% of the increased issued and paid up share capitalin Winfields. Winfields was incorporated on 30 March 2006 as a private limited company under the Companies Act,1965. The principal activities of Winfields are investment holding and rental of properties.

(iv) On 1 June 2009, the Company’s Board of Directors had approved the disposal of its 20% equity interest inGleneagles Academy of Nursing (M) Sdn Bhd (“Gleneagles Nursing”) representing 40,000 ordinary shares of RM1each for a cash consideration of RM61,539. Accordingly, Gleneagles Nursing has ceased to be an associatecompany of the Company.

(v) On 23 June 2009, Montego Assets Limited, a wholly-owned indirect subsidiary company, entered into a Members’Agreement made between Clan (CH) LLP, Native Land Limited, Montego Assets Limited and Chantrey House LLPto invest in 99.5% of the equity funding requirements in Eccleston Belgravia LLP, a limited liability partnershipregistered in England and Wales.

On the same date, Montego Assets Limited entered into a Members’ Agreement made between Clan (CH) LLP,Native Land Limited, Montego Assets Limited, Chantrey House LLP and Eccleston Belgravia LLP for EcclestonBelgravia LLP to acquire and own a property known as Chantrey House situated at Eccleston Street, London SW1for a cash consideration of GBP 20,750,000.

The transaction has been completed on 6 July 2009.

50. SIGNIFICANT EVENT SUBSEQUENT TO BALANCE SHEET DATE

On 7 August 2009, M & A Securities Sdn Bhd (“M & A Securities”), a wholly-owned subsidiary company, increased itsissued and fully paid-up share capital from RM60 million to RM90 million by way of the issuance of 30 million ordinaryshares of RM 1 each at an issue price of RM1 each which was fully subscribed by the Company.

On 23 September 2009, the Company announced that the Securities Commission has on 18 September 2009,approved the admission of M&A Securities to the Approved List of Principal Advisers Submitting Specific CorporateProposals pursuant to Chapter 3 of the Securities Commission’s Principal Adviser Guidelines. With the admission tothe Approved List, M&A Securities may act as a principal adviser for initial public offerings, reverse take-overs,restructurings and all type of other corporate proposals except for those involving private debt securities, Islamicsecurities and structured products.

51. FINANCIAL INSTRUMENTS

(a) Interest rate riskThe interest rate risk that financial instruments’ values will fluctuate as a result of changes in market interest rates, andthe effective interest rates on classes of financial assets and financial liabilities are as follows :-

EffectiveLess than 1 1 to 5 interest rate

financial financial during the year years Total financial year

RM’000 RM’000 RM’000 % per annum2009Group

Financial assets Deposits with licensed banks and financial institutions 430,611 - 430,611 0.10% - 7.33%

Financial liabilities Loans and borrowings 80,259 3,314 83,573 0.82% - 10.46%Amount due to an associate company 10,304 - 10,304 4.20%

2009Company

Financial assets Deposits with licensed banks and financial institutions 24,004 - 24,004 1.85% - 3.54%Amount due from subsidiary companies 648,854 - 648,854 2.50% - 3.0%

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51. FINANCIAL INSTRUMENTS (CONT’D)

(a) Interest rate risk (cont’d)Effective

Less than 1 1 to 5 interest ratefinancial financial during the

year years Total financial yearRM’000 RM’000 RM’000 % per annum

2009Company (cont’d)

Financial liabilities Loans and borrowings 4,000 - 4,000 4.58% - 5.84%Amount due to subsidiary companies 63,918 - 63,918 5.0%Amount due to an associate company 10,304 - 10,304 4.20%

2008 Group

Financial assets Deposits with licensed banks and financial institutions 376,775 - 376,775 0.43% - 7.46%

Financial liabilitiesLoans and borrowings 11,688 4,930 16,618 1.31% - 12.0%

2008 Company

Financial assets Deposits with licensed banks and financial institutions 1,687 - 1,687 3.30% - 7.30 %Amount due from subsidiary companies 533,250 - 533,250 3.30% - 12.0%

Financial liabilities Amount due to subsidiary companies 90,422 - 90,422 5.0%

(b) Credit riskThe Group has no significant concentration of credit risk with any single counterparty. The maximum exposure to creditrisk for the Group is the carrying amount of each financial asset.

Trade receivablesThe Group’s normal trade credit terms ranges from 30 to 90 days (2008 : 30 to 90 days) except for a subsidiarycompany whose credit terms is 3 market days according to the Bursa Malaysia Fixed Delivery and Settlement SystemTrading Rules. Other credit terms are assessed and approved on a case-by-case basis.

The Group’s normal credit term in relation to rental receivables is 7 days (2008: 7 days).

Trade payablesThe normal trade credit terms granted to the Group ranges from 30 to 90 days (2008 : 30 to 90 days) except for asubsidiary company whose credit terms is 3 market days according to the Bursa Malaysia Fixed Delivery andSettlement System Trading Rules.

(c) Foreign currency exchange riskThe net unhedged financial assets and liabilities of companies within the Group that are not denominated in theirrespective functional currencies are as follows:-

HongUS Singapore Sterling Australian Kong Other

Dollar Dollar Euro Pound Dollar Dollar currencies TotalGroup RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’0002009

Trade receivables 24,489 30 1,815 16 19 - - 26,369 Other receivables,

deposits and prepayments 603 858 1,106 22 319 33 - 2,941

Deposits with licensed banks and financial institutions 724 1,364 3,802 11,427 32,374 - - 49,691

Cash and bank balances 3,308 6,517 6,296 320 22 228 - 16,691Loans and borrowings (35,110) (9,484) - - (18,315) - - (62,909)Trade payables (12,140) (100) (481) (26) - - 228 (12,519)Other payables and

accruals (2,285) (445) (31) (34) (63) (27) (219) (3,104)

Net financial assets/(liabilities) (20,411) (1,260) 12,507 11,725 14,356 234 9 17,160

2008

Trade receivables 16,226 23 2,658 45 - - - 18,952 Other receivables,

deposits and prepayments 353 229 369 23 - 1,831 - 2,805

Deposits with licensed banks and financial institutions 14,536 9,750 137 2,877 2,146 - - 29,446

Cash and bank balances 2,081 5,278 5,017 240 19 128 - 12,763

Trade payables (10,441) (1,055) - - - - (68) (11,564)Other payables

and accruals (2,724) (425) - (138) - (22) - (3,309)

Net financial assets/ (liabilities) 20,031 13,800 8,181 3,047 2,165 1,937 (68) 49,093

(d) Fair values estimation for disclosure purposesThe carrying amounts of financial assets and liabilities of the Group at the balance sheet date approximated their fairvalues except as set out below:-

GroupCarrying Fair

Note Amount ValueRM’000 RM’000

2009Financial asset Long term investments - Unquoted investments in Malaysia 10 1,585 * - Quoted investments in Malaysia 10 34,895 47,706**

2008 Financial asset Long term investments - Unquoted investments in Malaysia 10 1,585 * - Quoted investments in Malaysia 10 36,923 48,922**

* It is not practicable within the constraints of timeliness and cost to estimate these fair values reliably.** The fair value of these investments are based on the latest audited net tangible assets per share.

INSAS51. FINANCIAL INSTRUMENTS (CONT’D)


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52. COMPARATIVE FIGURES

The following comparative figures have been restated to conform with current financial year’s presentation as follows:-

Aspreviously As

reported restatedGroup RM’000 RM’000

Income StatementCost of sales 172,443 177,124Administrative expenses 6,592 13,657 Other operating expenses 50,978 39,232

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Location Description / Area Tenure Approximate Date of Net bookExisting use age of acquisition value

buildings(years) RM'000

M & A Building 10 storey commercial 10,484 sq feet Freehold 11 18-Jan-1995 11,36652A, Jalan Sultan Idris Shah, building leased out and (Land area)30000 Ipoh, Perak for use as office premise

6, Jalan 31/70A, Desa Sri Hartamas, 4 storey shophouse 1,760 sq feet Freehold 12 31-Oct-2001 1,555 50480 Kuala Lumpur leased out (Land area)

Block 45 & 47, The Boulevard Offices, 2 blocks of 11 storey 54,277 sq feet Leasehold 7 17-Jun-2002 15,412 Mid Valley City, Lingkaran Syed Putra shop offices leased out (unexpired lease59200 Kuala Lumpur and for use as period of 93 years)

office premise

21, Plaza Crystalville 1, Jalan 23/70A, 3 storey shop office 4,497 sq feet Freehold 8 3-Jan-2000 1,127 Desa Sri Hartamas, 50480 Kuala Lumpur leased out

Lot No. A02-A07, B09-B15 & D33-D36 17 units of 4 storey 23,800 sq feet Leasehold Not applicable 11-Mar-2005 10,693H S (D) 122463-122465, 122467-122469 & 122471-122480 shop offices under (Land area) (unexpired lease 30-Jun-2005No. PT 10987-10989, 10991-10993 & 10995-11004 construction period of 94 years) & 31-Oct-2005Mukim Ampang, Daerah Ulu Langat, Selangor

R-3A-1, D’Aman Ria Apartment, Jalan PJU 1A/41, 1 unit apartment for 1,133 sq feet Freehold 6 22-Jun-2007 20747301 Petaling Jaya, Selangor lease

Parcel No. STA 09, No. 2, Jalan PJU 1A/41B, 3 storey shop office 5,532 sq feet Freehold 2 31-Jan-2005 1,242 Pusat Dagangan NZX, for lease47301 Petaling Jaya, Selangor and/or for sale

8A, Orange Grove Road, #11-03 D’Grove Villa, Apartment for lease 2,701 sq feet Freehold 16 14-Feb-1996 8,219Singapore

5, Draycott Drive, The ARC at Draycott, Apartment for lease 1,270 sq feet Freehold 1 27-Nov-2008 5,476 #15-02 Singapore

H S (D) 11371, No. P T 14461, Bukit Tinggi Resort, Vacant land for 130 acres Freehold Not applicable 24-Oct-1995 37,576 Mukim and District of Bentung, developmentPahang

Lot No. 51979, Geran No. 43962, Vacant land for 24,380 sq feet Freehold Not applicable 18-May-2004 5,277 Mukim & District of Kuala Lumpur development

Mukim of Ampang, District of Hulu Langat, Vacant land for 22.35 acres Not applicable Not applicable 15-Sep-2004 6,830 Selangor development

Lot No. 43927, PN 40549, 18 units shop offices and 2.94 acres Leasehold Not applicable 9-Mar-2006 63,483Mukim Ampang, Daerah Ulu Langat 2 blocks of 20 storey (unexpired leaseSelangor apartments under period of 96 years)

construction

H S (D) 95437-95440, 95499-95543 & 238319-238326 57 units of landed 268,223 sq feet Freehold Not applicable 20-Jul-2005 53,737 PT No. 29363-29366, 29425-29469 & 9769-9776 residential units underMukim of Sungai Buloh, District of Petaling, constructionSelangor

H.S.(D) 11698, PT No. 1709 Factory land with double 22,500 sq feet Leasehold Not applicable 31-Aug-2006 2,438Mukim 12, South West District, storey detached factory (unexpired leasePenang building period of 43 years)

Lot No. 12360, PN 5874, Mukim 12, Factory land 89,825 sq feet Leasehold Not applicable 17-Apr-2008 1,209South West District, Penang (unexpired lease

period of 42 years)

No. 51, Hilir Sungai Keluang 4, Industrial land with 90,002 sq feet Leasehold 12 years 21-Jul-2008 9,023 Bayan Lepas Free Industrial Zone Phase IV factory building (unexpired lease11900 Bayan Lepas, Penang period of 45 years)

No. G-F & No. 4-D, Block Emerald, 2 units apartments 1,331 sq feet & Freehold 12 years 26-Mar-1997 327 Kondominium Mahkotawira 1,345 sq feet andJalan Dato Khong Kam Tak, Ipoh, Perak 5-May-1997

Lot S391, S392, S393 and S394 4 units 2 storey shop 1,650 sq feet x 4 Leasehold 1 year 9-Jun-2008 1,960 erected on master title known as office for lease (unexpired leaseHS (D) 145840 PT 51439, Mukim of Petaling and/or for sale period of 91 years)Daerah Petaling, Selangor

INSAS


List of Properties HELD BY INSAS BERHAD GROUP AS AT 30 JUNE 2009

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Authorised Capital : RM1,500,000,000Issued and fully paid-up Capital : RM667,069,733 (excluding 26,263,900 Treasury shares)Class of Shares : Ordinary shares of RM1.00 each fully paidVoting Rights : One vote per RM1.00 share

ANALYSIS BY SIZE OF HOLDINGS

Size of Holdings No. of No. of sharesShareholders % of RM1.00 each %

Less than 100 318 0.84 13,751 0.00 100 - 1,000 8,530 22.50 7,591,066 1.14 1,001 - 10,000 23,797 62.76 104,512,362 15.67 10,001 - 100,000 4,897 12.91 135,359,694 20.29 100,001 - 33,353,487 372 0.98 294,407,471 44.13 33,353,488 and above 3 0.01 125,185,389 18.77

37,917 100.00 667,069,733 100.00

THIRTY LARGEST SHAREHOLDERSNo. of Shares

Name of RM1.00 each %

1. M & A Nominee (Asing) Sdn Bhd 45,000,000 6.75 - Anglo Asia Investments Limited for

M&A Investments International Limited

2. Dato’ Thong Kok Yoon 40,873,694 6.13

3. M & A Nominee (Asing) Sdn Bhd 39,311,695 5.89 - Anglo Asia Investments Limited

4. M & A Nominee (Asing) Sdn Bhd 26,084,800 3.91- M&A Investments Pte Ltd

5. M&A Investments International Limited 20,823,000 3.12

6. M & A Nominee (Tempatan) Sdn Bhd 20,500,000 3.07 - Baktihan Sdn Bhd

7. HSBC Nominees (Asing) Sdn Bhd 19,000,000 2.85 - Exempt An for The Bank of New York Mellon (Mellon Acct)

8. M & A Nominee (Asing) Sdn Bhd 18,269,360 2.74 - M&A Investments International Limited

9. Accroway Sdn Bhd 16,099,000 2.41

10. M & A Nominee (Asing) Sdn Bhd 15,650,000 2.35 - Armadale Holdings Limited

11. Immobillaire Holdings Sdn Bhd 7,734,273 1.16

12. HSBC Nominees (Asing) Sdn Bhd 7,261,400 1.09 - Exempt An for Credit Suisse (SG BR-TST-Asing)

13. M & A Nominee (Asing) Sdn Bhd 6,042,700 0.90 - Clearwind Holdings Limited

14. Lee Kim Poh 6,000,000 0.90

15. M & A Nominee (Tempatan) Sdn Bhd 4,456,693 0.67 - Titan Express Sdn Bhd

Analysis of Shareholdings AS AT 22 OCTOBER 2009

INSAS


No. of SharesName of RM1.00 each %

16. Citigroup Nominees (Asing) Sdn Bhd 4,218,350 0.63 - Exempt An for OCBC Securities Private Limited (Client A/C-NR)

17. Cimsec Nominees (Asing) Sdn Bhd 3,951,400 0.59 - Exempt An for CIMB-GK Securities Pte Ltd (Retail Clients)

18. Citigroup Nominees (Asing) Sdn Bhd 3,779,000 0.57 - CBNY for DFA Emerging Markets Fund

19. Alliancegroup Nominees (Tempatan) Sdn Bhd 3,598,600 0.54 - Pledged Securities Account for

Loh Kuan Fong (100339)

20. MKW Jaya Sdn Bhd 2,249,000 0.34

21. Datin Tan Few Teng 2,063,862 0.31

22. Perak Traders Holdings Sdn Bhd 2,045,200 0.31

23. Public Nominees (Tempatan) Sdn Bhd 2,005,800 0.30 - Pledged Securities Account for

Tan Geok Lian (KLC/JFA)

24. Terbit Berkat Sdn Bhd 2,000,000 0.30

25. Cimsec Nominees (Asing) Sdn Bhd 1,800,000 0.27 - CIMB for Loh Kim Kah (PB)

26. Citigroup Nominees (Asing) Sdn Bhd 1,642,200 0.25 - CBNY for DFA Emerging Markets Small Cap Series

27. Dato’ Thong Kok Khee 1,625,000 0.24

28. Lim Gaik Bway @ Lim Chiew Ah 1,470,000 0.22

29. HLG Nominee (Asing) Sdn Bhd 1,364,033 0.20 - Exempt An for UOB Kay Hian Pte Ltd (A/C Clients)

30. Mayban Nominees (Asing) Sdn Bhd 1,056,300 0.16 - Pledged Securities Account for

San Tuan Sam

327,975,360 49.17

SUBSTANTIAL SHAREHOLDERSNo. of Shares

Name of RM1.00 each %

1. Dato’ Thong Kok Khee * 167,805,625 25.16

2. M&A Investments International Limited 117,431,352 17.60

3. Dato’ Thong Kok Yoon ** 69,939,449 10.48

* Direct and deemed interest by virtue of his spouse’s interest and substantial interest in M&A Investments InternationalLimited, Accroway Sdn Bhd, Immobillaire Holdings Sdn Bhd and Baktihan Sdn Bhd

** Direct and deemed interest by virtue of his spouse’s interest in the Company, Titan Express Sdn Bhd, Perak TradersHoldings Sdn Bhd and Baktihan Sdn Bhd

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No. of Shares

The Company – Insas Berhad Direct Interest Deemed Interest

Number % Number %

1. Y.A.M. Tengku Puteri Seri Kemala Pahang 115,000 0.02 2,441,856(1) 0.35

Tengku Hajjah Aishah bte Sultan Haji Ahmad

Shah, DK(II), SIMP

2. Dato’ Thong Kok Khee 1,625,000 0.23 166,180,625(2) 23.97

3. Dato’ Wong Gian Kui 373,000 0.05 980,000(3) 0.14

4. Dr. Tan Seng Chuan - - - -

5. Ms. Soon Li Yen - - - -

6. Mr. Oh Seong Lye - - - -

Subsidiary Company – Insas Properties Sdn Bhd No. of Shares

1. Dato’ Wong Gian Kui 80,000 10.00 - -

Subsidiary Company – Segar Raya Development Sdn Bhd No. of Shares

1. Dato’ Wong Gian Kui 129,999 13.00 80,000(3) 8.00

Subsidiary Company – Contibina Sdn Bhd No. of Shares

1. Dato’ Thong Kok Khee - - 80,000(4) 40.00

Subsidiary Company – Premium Yield Sdn Bhd No. of Shares

1. Dato’ Wong Gian Kui - - 49,999(3) 5.00

Subsidiary Company – Dellmax Worldwide Sdn Bhd No. of Shares

1. Dato’ Wong Gian Kui - - 8,000(3) 8.00

Subsidiary Company – Gryphon Asset Management Sdn Bhd No. of Shares

1. Dato’ Thong Kok Khee - - 500,000(5) 25.00

Subsidiary Company – Micromodule Pte Ltd No. of Shares

1. Dr. Tan Seng Chuan 315,161 1.71 - -

By virtue of Dato’ Thong Kok Khee’s interest in the shares of the Company, he is also deemed interested in the shares of its relatedcorporations to the extent that the Company has an interest under Section 6A of the Companies Act, 1965.

Other than stated above, none of the other Directors of the Company had any direct and deemed interest in the Company or its relatedcorporations.

Notes :(1) Deemed interested by virtue of her interest in Wistara Sdn Bhd.(2) Deemed interested by virtue of his spouse’s interest and substantial interest in M & A Investments International Ltd, Accroway Sdn Bhd, Immobillaire Holdings Sdn Bhd and

Baktihan Sdn Bhd.(3) Deemed interested by virtue of his spouse’s interest in the Company.(4) Deemed interested by virtue of his interest in Taren Capital Corporation Sdn Bhd (In Members’ Voluntary Liquidation).(5) Deemed interest by virtue of his indirect interest in Maxcourt Enterprise Sdn Bhd.

Statement of Directors’ Interest In The Company And Its Related Corporations AS AT 22 OCTOBER 2009

INSAS


NOTICE IS HEREBY GIVEN that the Forty-Seventh Annual General Meeting of the Company shall be held at Bintang Ballroom,Cititel Mid Valley, Mid Valley City, Lingkaran Syed Putra, 59200 Kuala Lumpur on Thursday, 24 December 2009 at 11.00 a.m.for the following purposes: -

AGENDA

1. To receive, consider and adopt the Audited Financial Statements for the year ended 30 June 2009 and theReports of the Directors and Auditors thereon.

2. To approve the payment of Directors’ fees of RM72,000-00 for the year ended 30 June 2009.

3. To re-elect the following Director retiring pursuant to Article 96 of the Company’s Articles of Association: -

3.1 Dr. Tan Seng Chuan

4. To re-elect the following Directors retiring pursuant to Article 101 of the Company’s Articles of Association:-

4.1 Ms. Soon Li Yen

4.2 Mr. Oh Seong Lye

5. To re-appoint Messrs. SJ Grant Thornton as Auditors of the Company and to authorise the Directors to fixtheir remuneration.

SPECIAL BUSINESS

6. To consider and if thought fit, pass with or without modifications the following Resolution:

As Ordinary Resolution

AUTHORITY TO ISSUE SHARES PURSUANT TO SECTION 132D OF THE COMPANIES ACT, 1965

“THAT, subject always to the Companies Act, 1965, the Articles of Association of the Company and theapprovals of the relevant governmental/regulatory authorities, the Directors be and are hereby empowered,pursuant to Section 132D of the Companies Act, 1965, to issue shares in the Company from time to timeand upon such terms and conditions and for such purposes as the Directors may deem fit provided that theaggregate number of shares issued pursuant to this resolution does not exceed 10 percent of the issuedshare capital of the Company for the time being and that such authority shall continue in force until theconclusion of the next Annual General Meeting of the Company and that the Directors be and are alsoempowered to obtain the approval from the Bursa Malaysia Securities Berhad for the listing and quotationfor the additional shares so issued.”

7. To consider and if thought fit, pass with or without modifications the following Resolution:

As Ordinary Resolution

PROPOSED RENEWAL OF AUTHORITY TO PURCHASE ITS OWN SHARES BY THE COMPANY

“THAT, subject always to the Companies Act, 1965 (“the Act”), rules, regulations and orders made pursuantto the Act, provisions of the Company’s Memorandum and Articles of Association and the requirements ofthe Bursa Malaysia Securities Berhad (“Bursa Securities”) and any other relevant authority, the Directors ofthe Company be and are hereby authorised to make purchases of ordinary shares of RM1.00 each in theCompany’s issued and paid-up ordinary share capital through the Bursa Securities and to take all suchsteps as are necessary (including the opening and maintaining of a depository account under the SecuritiesIndustry (Central Depositories) Act, 1991) and enter into any agreements, arrangements and guaranteeswith any party or parties to implement, finalise and give full effect to the aforesaid purchase with full powersto assent to any conditions, modifications, revaluations, variations and/or amendments (if any) as may beimposed by the relevant authorities from time to time and to do all such acts and things as the said Directorsmay deem fit and expedient in the best interests of the Company, subject further to the following:-

(i) the maximum number of ordinary shares which may be purchased and held by the Company shall be69,333,363 ordinary shares of RM1.00 each representing approximately ten per centum (10%) of theexisting total issued and paid-up share capital of the Company inclusive of the 26,263,900 ordinaryshares of RM1.00 each already purchased and retained as treasury shares as at 22 October 2009;

(ii) the maximum funds to be allocated by the Company for the purpose of purchasing the ordinary sharesshall not exceed the share premium of the Company of RM66,394,352/- based on the latest auditedaccounts as at 30 June 2009;

Notice of Annual General Meeting

Resolution 1

Resolution 2

Resolution 3

Resolution 4

Resolution 5

Resolution 6

Resolution 7

Resolution 8

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NOTICE OF ANNUAL GENERAL MEETING (CONT’D)

(iii) the approval conferred by this resolution will commence immediately upon the passing of thisresolution and will expire at the conclusion of the next annual general meeting of the Companyfollowing the passing of this resolution (unless earlier revoked or varied by ordinary resolution of theshareholders of the Company in a general meeting) but not so as to prejudice the completion ofpurchase by the Company before the aforesaid expiry date and, in any event, in accordance with theprovisions of the Act, the rules and regulations made pursuant thereto and the guidelines issued by theBursa Securities and/or any other relevant authority; and

(iv) upon completion of the purchase(s) of the ordinary shares or any part thereof by the Company, theDirectors of the Company be and are hereby authorised to cancel all the shares so purchased or retainall the shares as treasury shares for future re-sale or for distribution as dividend to the shareholders ofthe Company or retain part thereof as treasury shares and cancelling the balance, and in any othermanner as prescribed by the Act, rules, regulations and orders made pursuant to the Act and therequirements of the Bursa Securities and any other relevant authority for the time being in force.”

8. To transact any other business of the Company of which due notice shall have been given in accordancewith the Company’s Articles of Association and the Companies Act, 1965.

By Order Of The Board

Chow Yuet KuenYau Jye YeeSecretaries

Kuala Lumpur02 December 2009

Explanatory Notes to Ordinary Resolution 7

The Company is actively looking into prospective areas to broaden its operating base and earning potential of the Companywhich may involve the issue of new shares. In order to avoid any delay and costs involved in convening a general meeting ofthe Company to approve such issue of shares, the proposed adoption of Ordinary Resolution 7 is to empower the Directors ofthe Company to issue shares up to an amount not exceeding in total 10% of the issued share capital of the Company for thetime being for such purpose. This authority, unless revoked or varied at a general meeting, will expire at the next Annual GeneralMeeting of the Company.

Explanatory Notes to Ordinary Resolution 8

The proposed Ordinary Resolution 8 if passed will empower the Directors to purchase the Company’s shares of up to 10% ofthe issued and paid-up capital of the Company by utilising the funds allocated out of the share premium account of the Company.This authority, unless revoked or varied at a general meeting, will expire at the conclusion of the next Annual General Meetingof the Company. For further information on the Proposed Share Buy-Back, kindly refer to the Statement in Relation to theProposed Renewal of Authority to Purchase its Own Shares by the Company on Page 88 to 90 of the Annual Report 2009.

Notes:-

(i) A member entitled to attend and vote at the meeting is entitled to appoint not more than two proxies to attend and vote in his stead. Where a memberappoints two (2) proxies, he shall specify the proportion of his shareholdings to be represented by each proxy.

(ii) A member of the Company who is an authorised nominee as defined under the Securities Industry (Central Depositories) Act 1991 may appoint atleast one (1) proxy in respect of each securities account.

(iii) A proxy need not be a member of the Company. (iv) In the case of a corporate member, the instrument appointing a proxy shall be under its Common Seal or under the hand of a duly authorised officer

or attorney. (v) The instrument appointing a proxy must be deposited at the Company’s Registered Office situated at No. 45-5, The Boulevard, Mid Valley City,

Lingkaran Syed Putra, 59200 Kuala Lumpur not less than 48 hours before the time appointed for holding the meeting or at any adjournment thereof.

INSAS


1. The Directors who are standing for re-election at the 47th Annual General Meeting of the Company pursuant to theCompany’s Articles of Association are :-

Article 96

a) Dr. Tan Seng Chuan

Article 101

a) Ms. Soon Li Yen b) Mr. Oh Seong Lye

2. The profile of the Directors standing for re-election are set out in Page 4 of the Annual Report.

3. The securities holdings of the Directors standing for re-election are as follows: -

a) Dr. Tan Seng Chuan : NIL

b) Ms. Soon Li Yen : NIL

c) Mr. Oh Seong Lye : NIL

4. Details of the Board Meetings held in the financial year ended 30 June 2009 :-

A total of five (5) Board Meetings were held during the financial year ended 30 June 2009 at the Boardroom, No. 45-3, TheBoulevard, Mid Valley City, Lingkaran Syed Putra, 59200 Kuala Lumpur and Suite 23.02, Level 23, The Gardens SouthTower, Mid Valley City, Lingkaran Syed Putra, 59200 Kuala Lumpur respectively. The date and time of the Board Meetingsand details of attendance of the Directors are set out in the Statement of Corporate Governance appearing on page 8 ofthe Annual Report.

Statement Accompanying Notice of the 47th Annual General Meeting (PURSUANT TO PARA 8.27(2) OF THE LISTING REQUIREMENTS OF THE BURSA MALAYSIA SECURITIES BERHAD)

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The Bursa Malaysia Securities Berhad (“Bursa Securities”) takes no responsibility for the contents of this Statement, makes norepresentation as to its accuracy or completeness and expressly disclaims any liability whatsoever for any loss howsoeverarising from or in reliance upon the whole or any part of the contents of this Statement.

1. INTRODUCTION

On 27 October 2009, the Company announced its intention to seek the approval from the shareholders for renewal of authorityfor the Company to purchase and/or hold its own ordinary shares of RM1.00 each (“Shares”) up to a maximum of 69,333,363Shares representing approximately ten percent (10%) of the issued and fully paid-up share capital of the Company for the timebeing, inclusive of the 26,263,900 Shares already purchased and retained as Treasury Shares (“Proposed Share Buy-Back”).Accordingly, the number of Shares which are available for further buy back by the Company is up to a maximum of 43,069,463Shares after deducting 26,263,900 Shares already purchased and retained as Treasury Shares.

2. THE PROPOSED SHARE BUY-BACK

The Proposed Share Buy-Back is subject to compliance with Section 67A of the Companies Act, 1965 (“Act”), ListingRequirements of the Bursa Securities (“Listing Requirements”) and any prevailing laws, rules, regulations, orders,guidelines and requirements issued by the relevant authorities at the time of purchase.

Pursuant to Chapter 12 of the Listing Requirements, the Proposed Share Buy-Back must be made wholly out of retainedprofits and/or the share premium account of the listed company. Based on the latest annual audited accounts as at 30 June2009, the share premium account and the retained profit of the Company were RM66.3 million and RM702,000 respectively.The Board therefore proposes to allocate up to RM66.3 million of the share premium account for the Proposed Share Buy-Back, which shall be funded by internal generated funds of the Group and/or external borrowings. In the event that theCompany intends to fund the Proposed Share Buy-Back via external borrowings, the Company would ensure there issufficient funds to repay the external borrowings and that the repayment would have no material impact on the cash flow ofthe Group.

3. RATIONALE FOR, POTENTIAL ADVANTAGES AND DISADVANTAGES OF THE PROPOSED SHARE BUY-BACK

The Proposed Share Buy-Back will enable the Company to utilise its financial resources to purchase its own Shares fromthe market. The Company may, through this scheme, be able to reduce the liquidity of Shares in the market which generallywill have a positive impact on the market price of Shares.

The Directors may at its discretion retain the purchased Shares as Treasury Shares, or for resale on the Bursa Securitieswith the intention of realizing a potential gain, or to distribute the Treasury Shares to the shareholders as dividends to serveas a reward to the shareholders. The Directors could also opt for the purchased Shares to be cancelled, or retain partthereof as Treasury Shares and cancelling the balance, and to treat the Shares in any manner as prescribed by the Act,rules, regulations and orders made pursuant to the Act, the requirements of Bursa Securities and any other relevantauthorities.

The Proposed Share Buy-Back will nevertheless reduce the financial resources of the Group and may result in the Groupforegoing other investment opportunities that may emerge in the future.

The Board will be mindful of the interest of the Company and its shareholders in implementing the Proposed Share Buy-Back.

4. EFFECTS OF THE PROPOSED SHARE BUY-BACK

4.1 On Share Capital

There will be no effect on the issued and fully paid-up share capital of the Company if the purchased Shares areretained as Treasury Shares.

In the event that the 69,333,363 Shares representing approximately 10% of the issued and fully paid-up share capitalof the Company are purchased and cancelled, the effect on the share capital of the Company are illustrated as follows:-

No. of SharesIssued and fully paid-up share capital as at 22 October 2009 693,333,633 Assumed the Shares purchased and cancelled (69,333,363)*

Resultant issued and fully paid-up share capital 624,000,270

* Inclusive of the 26,263,900 Shares already purchased and retained as Treasury Shares as at 22 October 2009.

Statement in Relation to the Proposed Renewal of Authority toPurchase its Own Shares by the Company

INSAS


4. EFFECTS OF THE PROPOSED SHARE BUY-BACK (CON’T)

4.2 On Earnings

The effect of the Proposed Share Buy-Back on earnings and earnings per share of the Group will depend on thequantum of Shares purchased, the purchase price and the effective funding cost thereon.

4.3 On Net Assets (“NA”)

The effect of the Proposed Share Buy-Back on the NA per share of the Group will depend on the quantum of Sharespurchased and the purchase price of the Shares at the time of buy back.

4.4 On Working Capital

The Proposed Share Buy-Back will reduce the working capital of the Company, the quantum of which will depend,amongst others, the quantum of Shares purchased and the purchase price of the Shares.

4.5 On Public Shareholding Spread

The public shareholding spread of the Company as at 22 October 2009 is approximately 64.29%. Assuming theProposed Share Buy-Back is carried out in full and there is no change in shares held by Substantial Shareholders,Directors and persons connected to them, the proforma public shareholding spread of the Company would be reducedto approximately 58.08%.

4.6 On Shareholdings of Substantial Shareholders and Directors

The effect of the Proposed Share Buy-Back on the shareholding of the Substantial Shareholders and Directors of theCompany based on the Register of Substantial Shareholders and Register of Directors’ shareholding respectively asat 22 October 2009 are as follows:-

No. of ordinary shares heldAs at 22 October 2009(1) After the Proposed Share Buy-Back(2)

Direct % Indirect % Direct % Indirect %Substantial

Shareholders

Dato’ Thong Kok Khee 1,625,000 0.24 166,180,625(3) 24.91 1,625,000 0.26 166,180,625(3) 26.63

M&A Investments 117,431,352 17.60 - - 117,431,352 18.82 - - International Limited

Dato’ Thong Kok Yoon 40,873,694 6.13 29,065,755(4) 4.36 40,873,694 6.55 29,065,755(4) 4.66

Directors

Y.A.M. Tengku Puteri 115,000 0.02 2,441,856(5) 0.37 115,000 0.02 2,441,856(5) 0.39 Seri Kemala Pahang Tengku Hajjah Aishah bte Sultan Haji Ahmad Shah, DK(II), SIMP

Dato’ Thong Kok Khee 1,625,000 0.24 166,180,625(3) 24.91 1,625,000 0.26 166,180,625(3) 26.63

Dato’ Wong Gian Kui 373,000 0.06 980,000(6) 0.15 373,000 0.06 980,000(6) 0.16

Dr. Tan Seng Chuan - - - - - - - -

Ms. Soon Li Yen - - - - - - - -

Mr. Oh Seong Lye - - - - - - - -

Notes:-(1) Calculated based on 667,069,733 Shares, after adjusting for 26,263,900 Shares already purchased and retained as Treasury Shares as at 22 October 2009.(2) Assuming the Proposed Share Buy-Back are undertaken in full and the maximum of 69,333,363 Shares so purchased representing a maximum of ten

percent (10%) of the issued and fully paid-up share capital of the Company as at 22 October 2009 are retained as Treasury Shares and/or cancelled.(3) Deemed interest by virtue of his spouse’s interest and substantial interest in M&A Investments International Limited, Accroway Sdn Bhd, Immobillaire

Holdings Sdn Bhd and Baktihan Sdn Bhd.(4) Deemed interest by virtue of his spouse’s interest in the Company, Titan Express Sdn Bhd, Perak Traders Holdings Sdn Bhd and Baktihan Sdn Bhd.(5) Deemed interest by virtue of her interest in Wistara Sdn. Bhd.(6) Deemed interest by virtue of his spouse’s interest in the Company.

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5. IMPLICATION RELATING TO THE MALAYSIAN CODE ON TAKE-OVERS AND MERGERS 1998 (“CODE”)

The direct and indirect shareholdings of Substantial Shareholders, namely Dato’ Thong Kok Khee and Dato’ Thong KokYoon and persons connected to them namely Datin Yeoh Kwee See and Datin Tan Few Teng, being their respectivespouses and M&A Investments International Limited, Accroway Sdn Bhd, Immobillaire Holdings Sdn Bhd, Baktihan SdnBhd, Titan Express Sdn Bhd and Perak Traders Holdings Sdn Bhd (collectively “Major Shareholders”) as at 22 October 2009are approximately 32.57% of the issued and fully paid-up share capital of the Company after adjusting for 26,263,900Shares already purchased and retained as Treasury Shares. In the event that the Proposed Share Buy-Back of up toapproximately ten percent (10%) is carried out in full, their collective shareholdings in the Company will be increased toapproximately 34.81% of the issued and fully paid-up share capital of the Company if the number of ordinary shares heldby them remain unchanged.

Pursuant to the Code, a person who holds more than thirty three percent (33%) of the voting shares of the Company shallundertake a mandatory general offer for the remaining ordinary shares of the Company not already owned by the saidperson. Accordingly, if the Proposed Share Buy-Back is implemented in full, the Major Shareholders would therefore triggera mandatory general offer pursuant to the Code.

As at the date hereof, the Company has yet to decide on the percentage of its own Shares to be purchased under theProposed Share Buy-Back. However, the Company will ensure the number of Shares to be purchased under the ProposedShare Buy-Back will not result in the Major Shareholders holding collectively more than 33% of the voting shares in theCompany thereby triggering a mandatory general offer.

6. DIRECTORS’ AND SUBSTANTIAL SHAREHOLDERS’ INTEREST

Save for the proportionate increase in the percentage shareholdings and/or voting rights of all the shareholders in theCompany as a consequence of the Proposed Share Buy-Back, none of the Directors and Substantial Shareholders andpersons connected to them have any interest, directly or indirectly, in the Proposed Share Buy-Back and, if any, the resaleof the Treasury Shares.

7. DIRECTORS’ RECOMMENDATION

Your Directors are of the opinion that the Proposed Share Buy-Back is in the best interest of the Company and accordinglyrecommend that you vote in favour of the ordinary resolution to be tabled at the forthcoming Forty-Seventh Annual GeneralMeeting.

8. FURTHER INFORMATION

Shareholders are requested to refer to the Company’s Statements of Changes in Equity for the financial year ended 30 June2009 and the Note 27 to the financial statements for further information on the purchases made by the Company of its ownShares during the aforesaid financial year.

Number of sharesheld

I/We

of

being a member/members of INSAS BERHAD hereby appoint Mr./Ms.

of

or failing him/her, the Chairperson of the meeting, as my/our proxy to vote for me/us and on my/our behalf at the Forty-Seventh AnnualGeneral Meeting of the Company to be held at Bintang Ballroom, Cititel Mid Valley, Mid Valley City, Lingkaran Syed Putra, 59200Kuala Lumpur on Thursday, 24 December 2009 at 11.00 a.m. or at any adjournment thereof in the manner indicated below :-

NO. RESOLUTIONS FOR AGAINST

1 To adopt the Audited Financial Statements for the year ended 30 June 2009 andthe Reports of the Directors and Auditors thereon.

2 To approve the payment of Directors’ fees of RM72,000-00 for the year ended 30June 2009.

3 To re-elect Dr. Tan Seng Chuan as Director pursuant to Article 96 of the Company’sArticles of Association.

4 To re-elect Ms. Soon Li Yen as Director pursuant to Article 101 of the Company’sArticles of Association.

5 To re-elect Mr. Oh Seong Lye as Director pursuant to Article 101 of the Company’sArticles of Association.

6 To re-appoint Messrs. SJ Grant Thornton as Auditors of the Company and toauthorise the Directors to fix their remuneration.

7 To approve authority to the Directors to allot and issue shares pursuant to Section132D of the Companies Act, 1965.

8 To approve the Proposed Renewal of authority to purchase its own shares by theCompany.

(Please indicate with an “X” in the space provided whether you wish your vote to be cast for or against the Resolution. In theabsence of specific directions, your Proxy will vote or abstain as he thinks fit.)

The proportion of my/our holding to be represented by my/our proxy/proxies are as follows:-

Proxy 1: % CDS A/C No.:

Proxy 2: %

Total: 100%

Dated this day of , 2009.

Signature / Common Seal of Shareholder(s)

NOTES:

A member entitled to attend and vote at the meeting is entitled to appoint not more than two proxies to attend and vote in his stead. Where a member appoints two (2) proxies, heshall specify the proportion of his shareholdings to be represented by each proxy. A member of the Company who is an authorised nominee as defined under the Securities Industry(Central Depositories) Act 1991 may appoint at least one (1) proxy in respect of each securities account. A proxy need not be a member of the Company. In the case of a corporatemember, the instrument appointing a proxy shall be under its Common Seal or under the hand of a duly authorised officer or attorney.

The instrument appointing a proxy must be deposited at the Company’s Registered Office situated at No. 45-5, The Boulevard, Mid Valley City, Lingkaran Syed Putra, 59200 KualaLumpur not less than 48 hours before the time appointed for holding the meeting or at any adjournment thereof.

INSASPROXY FORM FORTY-SEVENTH ANNUAL GENERAL MEETING

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The Registrar

INSAS BERHAD (4081-M)

No. 45-5, The BoulevardMid Valley CityLingkaran Syed Putra59200 Kuala LumpurMalaysia

1st fold here

Affix Stamp

Suite 23.02 Level 23

The Gardens South Tower

Mid Valley City

Lingkaran Syed Putra

59200 Kuala Lumpur

Tel 03 22829311

Fax 03 22848500

Documents

INSAS-AnnualReport2009 (374KB)