other information - HeiTech Padu Berhad

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HEITECH PADU BERHAD (310628-D)
HeiTech Padu Berhad (310628-D)
Level 15, HeiTech Village, Persiaran Kewajipan, USJ 1,
UEP Subang Jaya, 47600 Subang Jaya, Selangor Darul Ehsan, Malaysia
T+(803) 8026 8888 +(603) 8601 3000 F+(603) 8024 7997
Annual Report 2013
www.heitech.com.my
HeiTech fully supports 3R (reduce, reuse and recycle)
HeiTech menyokong sepenuhnya 3M
(mengurangkan, mengguna semula dan mengitar semula)
Corporate Responsibility Note:
It has been our commitment to go green by going paper “less”.
Please support our 3R effort towards a greener future.
Annual Report 2013
CREATING
OPPORTUNITIES
FOR CONTINUOUS
GROWTH
Over the years, HeiTech has carved a niche
reputation for itself in the IT industry.
Backed by experience and expertise as a premier transformation agent, we are now embarking on a strategic
business diversification and expansion exercise to ensure continuous growth. Coupled with our home-grown
solutions, we are well poised to deliver innovative ICT solutions for Malaysia and beyond.
WHAT’S INSIDE
Annual General Meeting
02
05
06
07
Company’s Corporate Responsibility
Leadership
Notice of Annual General Meeting
Statement Accompanying Notice of
Administrative Guidelines and Notes
Financial Calendar 2013/2014
70
Company’s Corporate Governance
78
83
91
Company
08
12
14
16
18
20
34
36
38
45
46
50
52
56
58
Corporate Responsibility
Chairman’s Statement
Company Overview
Global Reach
Corporate Information
Group Structure
HeiTech Group
Solutions & Services
Board of Directors
Profile of Directors
Profile of Group Company Secretary
Executive Committee
Our Accolades
Significant Events
Corporate Milestones
Trade Marks
96
Audit Committee Report
Statement of Corporate Governance
Statement on Risk Management and
Internal Control
Disclosure to Bursa Malaysia
Financial Statements
100 Statement of Director’s Responsibilities
101 Financial Statements
Other Information
192 List of Properties
193 Analysis of Shareholdings
Form of Proxy
Company’s Performances
60
61
62
Simplified Selected Five (5) Years Group
Review
Five (5) Years Group Performance
Highlights
Review of Operations
read here…or go online
2013 Annual Report and accounts
You can find more detailed information regarding HeiTech
performance during 2013 from our online Annual Report and
accounts. Providing our reports electronically online allows us to
reduce the paper we print and distribute.
visit HeiTech
www.heitech.com.my
page
HeiTech Padu Berhad
2
Annual Report 2013
NOTICE OF
ANNUAL GENERAL MEETING
NOTICE IS HEREBY GIVEN THAT THE NINETEENTH (19TH) ANNUAL
GENERAL MEETING OF THE COMPANY WILL BE HELD AT BALLROOM
SELANGOR 1, GRAND DORSETT SUBANG HOTEL, JALAN SS12/1,
47500 SUBANG JAYA, SELANGOR DARUL EHSAN, MALAYSIA ON
MONDAY, 23 JUNE 2014, AT 10:30 A.M. FOR THE FOLLOWING
PURPOSES:1)
To receive and adopt the Audited Financial Statements of the Company for the financial
year ended 31 December, 2013 together with the Reports of Directors and Auditors.
Resolution 1
2)
To re-elect YBhg. Tan Sri Dato’ Sri Abi Musa Asa’ari bin Mohamed Nor retiring under
Article 82 of the Company’s Articles of Association and who, being eligible, offers himself
for re-election.
Resolution 2
3)
To re-elect YBhg. Dato’ Mohd Fadzli bin Yusof retiring under Article 82 of the Company’s
Articles of Association and who, being eligible, offers himself for re-election.
Resolution 3
4)
To re-elect Tuan Haji Ghazali bin Awang retiring under Article 82 of the Company’s
Articles of Association and who, being eligible, offers himself for re-election.
Resolution 4
5)
To re-elect Mr. Sulaiman Hew bin Abdullah retiring under Article 85 of the Company’s
Article of Association and who, being eligible, offers himself for re-election.
Resolution 5
6)
To re-elect Puan Wan Ainol Zilan binti Abdul Rahim retiring under Article 85 of the
Company’s Article of Association and who, being eligible, offers herself for re-election.
Resolution 6
7)
To retain Tuan Haji Ghazali bin Awang as an Independent Director.
Resolution 7
8)
To retain YBhg. Dato’ Mohd Fadzli bin Yusof as an Independent Director.
Resolution 8
9)
To approve the payment of Directors’ Fees for the financial year ended 31 December,
2013.
Resolution 9
10) To re-appoint Messrs. Hanafiah Raslan & Mohamad as Auditors for the ensuing year and Resolution 10
to authorise the Directors to fix the remuneration of the Auditors.
As a Special Business
11) To consider and, of thought fit, to pass the following resolution as Ordinary Resolution:Proposed Authority to Issue Shares
“THAT pursuant to Section 132D of the Companies Act 1965, the Directors be and are
hereby authorised to issue shares of the Company at any time until the conclusion of
the next Annual General Meeting and upon such terms and conditions and for such
purposes as the Directors may, in their absolute discretion, deem fit provided that the
aggregate number of shares to be issued does not exceed 10% of the issued share
capital of the Company for the time being, subject always to the approval of all relevant
regulatory bodies being obtained for such issue and allotment.”
Resolution 11
page
www.heitech.com.my
12) To consider and, if thought fit to pass the following Ordinary Resolution:Proposed Renewal of Shareholders’ Mandate for Recurrent Related Party Transactions
of a Revenue or Trading Nature
“THAT, subject always to the Listing Requirements of Bursa Malaysia Securities Berhad,
approval be and is hereby given for the Proposed Renewal of Shareholders’ Mandate for
the Company and its subsidiaries (“HeiTech Group”) to enter into recurrent transactions
of a revenue or trading nature which is necessary for HeiTech Group’s day to day
operations, as set out in the Circular to shareholders dated 27 May 2014 with the related
parties mentioned therein provided that the transactions are in the ordinary course of
business and/or normal commercial terms that are not more favourable to the related
parties than those generally available to the public and are not to the detriment of the
minority shareholders of the Company.
AND THAT the authority conferred by this resolution shall commence immediately upon
the passing of this resolution and shall continue to be in force until:(i) the conclusion of the next AGM of HeiTech following the forthcoming AGM at which
such proposed Shareholders’ Mandate is passed, or at which time it will lapse, or
the authority is renewed; or
(ii) revoked or varied by resolution passed by the shareholders in an AGM or EGM; or
(iii) the expiration of the contract;
Whichever is earlier.
OTHER ORDINARY BUSINESS
To transact any other business of the Company of which due notice has been received.
By Order of the Board
Ahmad Noor bin Sulong (MAICSA 7062155)
Company Secretary
Subang Jaya
27 May 2014
3
Resolution 12
page
HeiTech Padu Berhad
4
Annual Report 2013
Notice of
Notes:
Explanatory notes to the Agenda:-
1. A Member entitled to attend and vote at the Annual General
Meeting is entitled to appoint a proxy or proxies to attend and
vote in his/her stead. A proxy may but need not be a member of
the Company and where there are two (2) (or more) proxies, the
number of shares to be represented by each proxy must be
stated.
(i) Explanatory note on Resolution 7 and 8 of the Agenda: The proposed resolutions if passed, will allow Tuan Haji Ghazali
bin Awang and YBhg. Dato’ Mohd Fadzli bin Yusof to be retained
and continue acting as Independent Directors to fulfill the
requirement of Paragraph 3.04 of Bursa Malaysia Securities Berhad
Main Market Listing Requirements.
2. A Member is entitled to appoint up to two (2) proxies to attend
and vote in his/her place. Where a member appoints up to two
(2) proxies, the appointments shall be invalid unless he/she
specifies the proportions of his/her holdings to be represented by
each proxy.
Tuan Haji Ghazali bin Awang and YBhg. Dato’ Mohd Fadzli bin
Yusof were appointed as Independent Non-Executive Directors of
the Company on 8 March 2005 and 7 October 2005 respectively
and will or have reached cumulative nine (9) years term limit
recommended by the Malaysian Code on Corporate Governance
2012 (“MCCG 2012”).
In accordance with Recommendation 3.3 of the MCCG 2012, the
Board of Directors of the Company, after having assessed the
independence of YBhg. Dato’ Mohd Fadzli bin Yusof and Tuan
Haji Ghazali bin Awang regarded them to be independent based
amongst others, the following justifications and recommends that
they be retained as Independent Non-Executive Directors of the
Company.
Provided however, where a Member is an authorised nominee as
defined in accordance with the provisions of the Securities
Industry (Central Depositories) Act, 1991, he/she may appoint up
to two (2) proxies in respect of each Securities Account he/she
holds with ordinary shares in the Company standing to the credit
of the Securities Account.
3. Where the appointment is executed by a corporation, it must be
either under its Common Seal or the hand of its officer or attorney
duly authorised.
i.
4. The instrument appointing a proxy and the power of attorney or
other authority (if any) under which it is guided or notarially
certified copy of such power or authority, must be deposited at
the office of the Company’s Registrar: MIDF Consultancy and
Corporate Services Sendirian Berhad, at Level 8, Menara MIDF, 82
Jalan Raja Chulan, 50200 Kuala Lumpur, not less than forty-eight
(48) hours before the time appointed for holding the Meeting or
at any adjournment thereof.
5. Only members registered in the Record of Depositors as at
17 June 2014 shall be eligible to attend the Annual General
Meeting or appoint proxy to attend and vote on their behalf.
The Board of Directors is of the opinion that they are important
Independent Non-Executive Directors of the Board in view of
their many years on the Board with incumbent knowledge of
the Company, proven commitment, experience and
competence to effectively advice and oversee management
in their role as Independent Non-Executive Directors.
ii. They actively participate in Board deliberations and decision
making in an objective manner.
iii. They do not have any conflict of interest with the Company
and have not entered into contract(s) especially material
contract(s) with the Company and/or its subsidiary companies.
(ii) Explanatory note on Resolution 11 of the Agenda:
The Company has not issued any new shares under the general
mandate for issuance and allotment of shares up to an aggregate
amount not exceeding 10% of the issued and paid-up capital of
the Company, which was approved at the 18th Annual General
Meeting held on 26 June 2013 and which will lapse at the
conclusion of the 19th Annual General Meeting to be held on
23 June 2014. A renewal of this mandate is sought at the 19th
AGM under proposed Ordinary Resolution 11.
The proposed Ordinary Resolution 11 if passed, is primarily to give
flexibility to the Board of Directors to issue and allot ordinary
shares in the capital of the Company up to an aggregate
amount not exceeding 10% of the issued and paid-up share
capital of the Company for the time being, at any time in their
absolute discretion in the interest of the Company, without having
to convene a general meeting. This authority, unless revoked or
varied at a general meeting, will expire at the next Annual
General Meeting.
The purpose of the general mandate is for possible fund raising
exercises including but not limited to further placement of shares
for purpose of funding current and/or future investment projects,
working capital and/or acquisitions.
(iii)Explanatory note on Resolution 12 of the Agenda:
For further information on Ordinary Resolution 12, please refer to
Circular to Shareholders dated 27 May 2014 accompanying the
Company’s Annual Report for the year ended 31 December 2013.
page
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5
STATEMENT ACCOMPANYING
NOTICE OF ANNUAL GENERAL MEETING
PURSUANT TO PARAGRAPH 8.27(2) OF THE LISTING REQUIREMENTS OF BURSA MALAYSIA SECURITIES
BERHAD
1. The profile of the Directors who are standing for re-appointment and re-election are set out on pages 38 to
44 of the Annual Report.
2. The details of the Directors’ shareholdings in the Company, are set out on pages 193 of the Annual Report.
3. None of the Company Directors hold any interest in the Company’s subsidiaries.
page
HeiTech Padu Berhad
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Annual Report 2013
ADMINISTRATIVE
GUIDELINES AND NOTES
19TH ANNUAL GENERAL MEETING
TO VALUED SHAREHOLDERS,
Administrative guidelines and notes for HeiTech Padu Berhad 19th Annual General Meeting (“AGM”)
Date
: 23 June 2014
Time
: 10.30 a.m.
Venue : Ballroom Selangor 1, Grand Dorsett Subang Hotel
Jalan SS12/1, 47500 Subang Jaya, Selangor Darul Ehsan
REGISTRATION
PROXY AND CORPORATE MEMBER
• Registration starts at 8.45 a.m., at the entrance of
BALLROOM SELANGOR 1 and will be closed at
10.30 a.m. sharp.
• A member entitled to attend and vote at the AGM
is entitled to appoint a proxy or proxies to attend
and vote on his/her stead. A proxy may but need
not be a member of the Company and where
there are two (2) (or more) proxies, the number of
shares to be represented by each proxy must be
stated.
• Our AGM working team will assist you to ascertain
which registration table you should approach for
the purpose of registration. Please present your
original Identity Card (ID) to our AGM working
team and make sure you collect your ID
subsequently.
• Once verified, please write and sign up on our
Attendance List.
• Once registered, please proceed to BALLROOM
SELANGOR 1.
• Note that you are not allowed to register on behalf
of another person even with the original ID of the
other person.
• Valued Shareholders will be entitled to receive one
(1) door gift only and the entitlement will be based
on the verification in the Shareholders’ Register.
• Our AGM working team handles verification and
registration only. Please proceed to our AGM
HELPDESK for your queries.
AGM HELPDESK
• Our AGM HELPDESK is located alongside the
registration tables.
• In any event, our AGM working team will channel
your queries to our respective AGM HELPDESK
Personnel: Ahmad Yusof bin Mat Nasir and Siti
Fatihah binti Md Yunus.
• To proceed with proxy appointment, the original
Proxy Form which is attached together with the
Company’s 2013 Annual Report must be completed,
signed, sent and delivered to the Company’s
Registrar: Equiniti Services Sdn Bhd (11324-H),
Level 8, Menara MIDF, 82 Jalan Raja Chulan,
50200 Kuala Lumpur by Saturday, 21 June 2014
at 10.30 a.m.
• In the case of member which is a company, the
completed Proxy Form must be executed under its
seal or under the hand of any officer or duly
authorised attorney.
AGM ENQUIRY
• If you have any general AGM queries prior to the
meeting, please do not hesitate to contact: HeiTech
Padu Berhad, Group General Counsel/Company’s
Secretary Office at +60(3) 8601 3128 and/or
+60(3) 8601 3127 of the following person during
office hours: Name
: SUZANA BINTI ABDUL RAHIM
Share Registrar: EQUINITI SERVICES SDN. BHD.
Tel
: +60(3) 2166 0933
E-mail
:[email protected]
page
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7
FINANCIAL CALENDAR
2013/2014
NOVEMBER 2013
28
FEBRUARY 2014
27
Quarterly report on
consolidated results for the
financial period ended
30 September 2013.
AUGUST 2013
Quarterly report on
31 December 2013.
28
Quarterly report on
30 June 2013.
MAY 2013
23
Quarterly report on
31 March 2013.
page
8
HeiTech Padu Berhad
Annual Report 2013
CHAIRMAN’S
STATEMENT
OUR VALUED SHAREHOLDERS AND STAKEHOLDERS,
In my last statement to shareholders, I wrote that HeiTech
Padu Berhad (“HeiTech”) was at a crossroad in its journey
to ensure its sustainability and survival in the present
challenging ICT business environment. Over the past 12
months, we had focussed on further strengthening our
business portfolios, domestic and abroad. This resulted in
an increase in the Group’s revenue from RM395.5 million in
2012 to RM413.8 million in 2013.
page
www.heitech.com.my
However, despite the increase in revenue, it saddens
me to share with our shareholders that we suffered a
RM33.3 million loss. In acknowledging this situation, we
had to face the reality that escalating project
development costs have put a whimper in the effort of
providing excellent project delivery.
Even though we can claim the glory in successfully
delivering of mega projects, we cannot claim the
bounty of our efforts as we experienced the first ever
loss in our history. Notwithstanding this temporary
setback, HeiTech remains committed to rebuild its
Group of Companies by bringing it back into profitability.
We may have lost the battle but not the war.
OUR OPERATIONS REVIEW
Through its fully integrated suites of IT services, from its
more traditional services such as system integration
and application development, data center and
business recovery, network services, web portal
application and electronic commerce, and record
management, HeiTech has added more state-of-theart technologies in cloud computing, mobile
application, electronic bill presentment, SAP suite of
products, simulated interactive maintenance aid, as
well as weapon management and surveillance system.
HeiTech is presently considered one of the most trusted
system integrators and service providers in both the
public and private sectors.
Throughout 2013, several noteworthy achievements
were attained by HeiTech. We continue to be entrusted
by our traditional major customers in the public sector,
the National Registration Department, Road Transport
Department, and the Immigration Department of
Malaysia to provide maintenance and technical
services for their computer systems. HeiTech also
established its presence in the health sector with the
contract from the Ministry of Health, Malaysia to
provide ICT equipment for the expansion of the “Sistem
Pengurusan Pesakit” (“SPP”) Version 3 at Hospital Raja
Perempuan Zainab II, Kota Bharu, Hospital Tuanku
Ja’afar, Seremban and Hospital Bentong, Pahang.
9
On the private sector front, HeiTech expanded its
coverage in the retail sector by providing cutting
edge network connectivity for leading hypermarkets in
Malaysia. In addition, HeiTech has also provided ICT
infrastructure related solutions for numerous significant
projects from Malaysia’s leading financial and
investment institutions.
Globally, HeiTech’s involvement in Sri Lanka was further
strengthened with the award by Sri Lanka’s Department
of Immigration and Emigration for the supply of 1.5
million blank ‘N’ series passports. In 2012, HeiTech
succeeded in tapping into new ASEAN markets
through the implementation of the Biometric Enrolment
& Information System for the Ministry of Labour
Employment and Social Security, Government of the
Republic of the Union of Myanmar. In 2013, HeiTech
was also entrusted by the Myanmar’s Ministry of
Foreign Affairs, to implement the Visa Issuance System
for their embassies and consulate offices in thirty six
(36) countries worldwide using a home-grown solutions,
PintarID developed by HeiTech e*Business Solutions.
OUR FINANCIAL TRACK
The Group's revenue increased by RM18.3 million or
5% to RM413.8 million in 2013 as compared to RM395.5
million in 2012. The increase in Group revenue is
attributable to the increase in our maintenance
charges by 39% and in sales of hardware and software
by 18% resulting in total gross revenue of RM191
million in 2013 from these two revenue streams.
Despite the improvement of revenue, the Group
recorded our first ever loss, a loss after taxation of
RM33.3 million, due to the increase of the project
development costs due to project delay which has
now been completed.
page
10
HeiTech Padu Berhad
Annual Report 2013
Chairman’s
Statement
MOVING FORWARD
In facing a more challenging business landscape,
HeiTech must be introspective. Internally, HeiTech’s
focus would be to strengthen its core capabilities
including people and processes. By strengthening our
internal processes and by leveraging on our human
and intellectual assets, I believe, we can identify the
right product to be developed and marketed
worldwide.
Externally, while enlarging its IT business in new areas
such as the banking and retail business, HeiTech will
also explore opportunities in unchartered territories like
transportation and engineering, departing from our
traditional business endeavours.
In terms of our business expansion abroad, HeiTech is
committed to continue making its presence in the
international arena. Through HeiTech Global Services
(HGS), HeiTech is committed to expand its business
footprint into Africa, Europe and greater Asia. Our
recent project win in Ghana is testament to our ability
to acclimatise our product and services to meet
specific and universal needs. With the right market and
the right product, we have initiated a partner
programme that best represents HeiTech as a localised
embodiment of our product, services, support and
spirit. Our success stories in Sri Lanka, Myanmar and
Indonesia were realised and fuelled by strong trusting
partners who were aligned and committed to champion
our mutual technological and business visions. The
aspirations of our programme are well founded as we
have developed stellar partnerships in our focused
markets. Our success stories in these markets will be
extended and repeated to other foreign markets like
Guinea, the Philippines and Bangladesh.
www.heitech.com.my
ACKNOWLEDGEMENT AND APPRECIATION
On behalf of the Board, I wish to extend our utmost
appreciation to our shareholders, our loyal customers
and our business partners for their unwavering support
in all our endeavours. I would also like to extend our
appreciation to the 1,500 fellow enablers in the Group
who, through their dedication, commitment and
passion, have allowed us to weather the storm.
In challenging business climates, HeiTech requires
continuous support and commitment. We hope all
stakeholders; both internal and external; will embark
on this journey together with us thus allowing the
Management the space and flexibility to implement
difficult but necessary measures to deliver HeiTech
back to profitability in the shortest time possible so
that we can retain our position as a trusted technology
partner in the industry.
Yours sincerely,
DATO’ MOHD HILMEY MOHD TAIB
Chairman
page
11
page
12
HeiTech Padu Berhad
COMPANY
OVERVIEW
We are driven by our
passion and perseverance
in order to deliver the best
to our customers
VISION
To become the technology-based
transformational company in Malaysia
and beyond.
MISSION
To be truly TRANSFORMATIONAL by:
• Providing Total Solutions
• Creating Innovative Products
• Consulting for a Better World
Annual Report 2013
page
www.heitech.com.my
13
OUR COMMITMENT
Our passion unites us in our quest for excellence in offering IT systems and technology
services that deliver greater security, added convenience and peace of mind. By listening
to what you want, we focus our solutions toward meeting your needs and expectations,
in adding even more value to your organisation.
OUR TRACK RECORD
We are global! We have touched the lives of Malaysians and citizens all over the world.
By embracing cutting-edge technologies, we have revolutionised the automated systems
of numerous customers in both the public and private sectors. From our humble beginning
of implementing mega ICT projects in Malaysia, we have gradually progressed to applying
our expertise globally, and also helping foreign governments and corporations transform
complex mission-critical operations and business processes into simplified solutions that
work.
STAFF STRENGTH
• More than 1,500 staff
• More than 80% are technical professionals
OUR EDGE
MORE THAN 20 YEARS OF IT
DEVELOPMENT AND IMPLEMENTATION
EXPERIENCE. Managing complexities
public and private sector projects
GLOBAL PRESENCE. Enabled via
our resources and partners all
over the world.
TECHNOLOGY INDEPENDENT.
Collaborating with major world
class technology providers to
deliver best of breed solutions.
MISSION CRITICAL SYSTEMS.
Trusted by organisations across
the globe in delivering mission
critical projects.
LEADING-EDGE TECHNOLOGY AND
BUSINESS PROCESSES. Delivering
business value to all industries.
page
14
HeiTech Padu Berhad
GLOBAL
REACH
Annual Report 2013
EUROPE
ASIA
AFRICA
AUSTRALIA
15 Global
Services
Marketplace
13 Countries
System
Integration
Services
4 Countries
Data Centre
Services
2 Countries
Consultancy
Services
HeiTech Padu Berhad is a company
borne out of innovation, reliability and
industry best practices. Our brand of
pioneering technology coupled with
refined and structured system
integration methods and best practices
is the livewire of governments, bank,
MNC’s and economies of the modern
world. As a premier transformation
agent, our mandate is toward
continuous perfection of technology
and shifting the complexity out of IT.
Globalisation presents a window of
opportunity for HeiTech to grow as an
international conglomerate. As business
is global, the management team of
HeiTech has indoctrinated borderless
thinking in allowing the mass population
of HeiTech to be change receptive
and agile enough to adapt to the
competitive nature of international
business activities. Our internal policies
have steadily liberalised HeiTech as a
firm of international competence and
competitiveness to contest aggressively
on a global platform.
In tandem with our international road
map, HeiTech together with its
operating companies has solidified our
range of products and services to
meet global standards. With a strong
resource and financial commitment to
Research and Development, we have
strived to ensure our brand of
technology is geared to enhance the
viability and productiveness of our
valued clients.
Our entry into the global markets has
been spurred by streamlined
collaborations and consolidation
between HeiTech’s operating
companies towards ensuring HeiTech’s
best interest is defined, structured and
met. In line with the formation of
HeiTech Global Services (HGS), the
decision to integrate the breadth and
depth of our operating companies
under one brand, to leverage and
offer total end-to-end services to serve
clients across different verticals, market
and geographical locations is
addressed, resolving the potential
conundrum on multiple representations.
Under the new international business
page
www.heitech.com.my
15
Australia
Brunei
China
Cambodia
• Automotive Industry
Solutions
• System Integration
Services
• Business Continuity
• Consulting Services
Services
• Outsourcing Services
Services
Ghana
Indonesia
Malaysia
Services
Services
• Business Process
Outsourcing Services
• Data Centre Services
Services
• Network Services
Myanmar
Philippines
Saudi Arabia
Services
Services
Services
• Consulting Services
Sri Lanka
Thailand
Services
• Disaster Recovery
Services
Services
United Arab
Emirates
Vietnam
Services
Services
United Kingdom
• Automotive Industry
Solutions
structure, all product and services under
HeiTech Group will be marketed and sold
by HGS. With HGS, the representation of
HeiTech as a firm of deep functional and
technical capacity coupled with industry
capability across a broad spectrum of
business services is personified, matching
market needs against product features.
The hallmark of HGS’s global thrust is
stamped on having specific market
identification, creditable local partners
and streamlined collaborations. These four
(4) pillars of our strategy are designed to
have a holistic and strategic approach to
achieve long term sustainability and
success. With a good reach into the
ASEAN and Middle East market, HGS is
committed to expand HeiTech’s foot print
into Africa, Europe and greater Asia. Our
recent project win in Ghana was testament
of our ability to acclimatise our product
and services to meet the specific and
universal needs.
With the right market and the right
products, we have initiated a partner
program to best represent HeiTech as a
localised embodiment of our product,
services, support and spirit. Our success
stories in Sri Lanka, Myanmar, Indonesia
and UAE were realised and fueled by
strong trusting partners who were aligned
and committed to champion our mutual
technological and business vision. Our
partners are a pivotal composition of our
international business play as we develop
them to be the face of HeiTech, acting as
our business and support enablers in their
respective segments. The aspirations of
our program are well founded as we have
developed stellar partnerships in our
focused markets.
HeiTech envisions international business to
be a significant contributor of our overall
growth. The maturity of our products and
our people coupled with the acceptance
of our value proposition locally and
internationally, has intensified our broad
focus. Our breakthrough internationally
will mark HeiTech’s global aspirations and
set the stage for a pioneering Malaysian
System Integrator to be internationally
acclaimed, recognised and respected.
page
16
HeiTech Padu Berhad
Annual Report 2013
CORPORATE
INFORMATION
BOARD OF DIRECTORS
DATO’ MOHD HILMEY BIN MOHD TAIB
Chairman
HAJI GHAZALI BIN AWANG
Independent Non-Executive Director
SYED AGEL BIN SYED SALIM
Non-Independent Non-Executive Director
DATO’ MOHD FADZLI BIN YUSOF
TAN SRI DATO’ SRI ABI MUSA ASA’ARI BIN
MOHAMED NOR
DATO’ DR. MOHAMED ARIFFIN BIN ATON
SULAIMAN HEW BIN ABDULLAH
WAN AINOL ZILAN BINTI ABDUL RAHIM
GROUP COMPANY SECRETARY
Ahmad Noor bin Sulong (MAICSA 7062155)
EXECUTIVE COMMITTEE
Dato’ Mohd Hilmey bin Mohd Taib
Chairman
Harris bin Ismail
Group Chief Executive Officer
Zohan Zuki Mohd Zuki
Group Chief Operating Officer
Ahmad Nasrul Hakim bin Mohd Zaini
Chief Financial Officer
Ahmad bin Abdul Ghani
Director, Corporate Services
Abdul Halim bin Md Lassim
Chief Executive Officer,
HeiTech Managed Services Sdn. Bhd.
HeiTech i-Solutions Sdn. Bhd.
Wan Zaidi bin Wan Jaafar
Chief Executive Officer,
HeiTech e*Business Solution Sdn. Bhd.
page
www.heitech.com.my
17
REGISTERED OFFICE
PRINCIPAL BANKERS
PRINCIPAL SOLICITORS
Level 15 HeiTech Village
Persiaran Kewajipan
USJ 1 UEP Subang Jaya
47600 Subang Jaya
Selangor Darul Ehsan
Malaysia
RHB Islamic Bank Berhad &
RHB Bank Berhad
Level 11
Menara Yayasan Tun Razak
200 Jalan Bukit Bintang
55100 Kuala Lumpur
Messrs. Azmi & Associates
14th Floor Menara Keck Seng
203 Jalan Bukit Bintang
55100 Kuala Lumpur
Tel : +603-8026 8888
Fax : +603-8024 7997
INCORPORATED
5 August 1994
WEBSITE ADDRESS
www.heitech.com.my
AUDITOR
Messrs. Hanafiah Raslan &
Mohamad
Level 23A Menara Millenium
Jalan Damanlela Pusat Bandar
Damansara
Damansara Heights
50490 Kuala Lumpur
CIMB Bank Berhad
10th Floor
Bangunan CIMB
Jalan Semantan
Damansara Heights
50490 Kuala Lumpur
AmIslamic Bank Berhad &
Ambank Berhad
Level 18 Menara Dion
Jalan Sultan Ismail
50250 Kuala Lumpur
Bank Muamalat Malaysia Berhad
1st Floor Podium Block
Menara Bumiputra
No.21 Jalan Melaka
50100 Kuala Lumpur
Malayan Banking Berhad
Ampang Park Branch
Ground Floor
Ampang Park Shopping Center
Jalan Ampang
50450 Kuala Lumpur
Public Bank Berhad
36-40 Medan Setia 2
Plaza Damansara
Bukit Damansara
50490 Kuala Lumpur
Export-Import Bank of Malaysia
Berhad
Level 1 Exim Bank
Jalan Sultan Ismail
50250 Kuala Lumpur
Emirates Islamic Bank
Khalifa City Branch
Khalifa A Abu Dhabi
P.O Box 46077
Messrs. Cheang & Ariff
39 Court@Loke Mansion
273A Jalan Medan Tuanku
50300 Kuala Lumpur
Messrs. Naqiz & Partners
No.42A Lorong Dungun
Damansara Heights
50490 Kuala Lumpur
SHARE REGISTRAR
Equiniti Services Sdn. Bhd.
(formerly known as MIDF
Consultancy and Corporate
Services Sendirian Berhad)
Level 8 Menara MIDF
82 Jalan Raja Chulan
50200 Kuala Lumpur
Tel : +603-2166 0933
Fax : +603-2166 0688
STOCK EXCHANGE LISTING
Main Board of Bursa Malaysia
Securities Berhad
(Listed since 20 November 2000)
Stock Code: 5028
Stock Name: HTPADU
14th Floor, Exchange Square
Bukit Kewangan
P.O. Box 11023
50670 Kuala Lumpur
Tel : +603-2034 7000
Fax : +603-2710 2308
AGM HELPDESK
Siti Fatihah Md Yunus
Tel
:+603-8601 3127/
+603-8601 3129
Fax : +603-8024 7997
page
18
HeiTech Padu Berhad
Annual Report 2013
GROUP
STRUCTURE
HeiTech e*Business Solution Sdn. Bhd. (100%)
Integrated Healthcare Solutions Sdn. Bhd. (100%)
HeiTech Defence Systems Sdn. Bhd. (100%)
HeiTech i-Solutions Sdn. Bhd. (100%)
HeiTech Managed Services Sdn. Bhd. (100%)
WHOLLY OWNED
SUBSIDIARIES
HeiTech Transbiz Sdn. Bhd. (100%)
Inter-City MPC (M) Sdn. Bhd. (100%)
Cinix 1 Pty. Ltd. (100%)
HeiTech Global Services Sdn. Bhd. (100%)
Pro-Office Solutions Sdn. Bhd. (100%)
HeiTech Health Services Sdn. Bhd. (100%)
Notes:
• The companies reflected above are operating subsidiaries, associated and investment companies.
• See pages 20 to 33 of this Annual Report for detailed descriptions of HeiTech Group of Companies.
• Information is accurate as at 30 April 2014.
page
www.heitech.com.my
19
SUBSIDIARY COMPANIES
DAPAT Vista Sdn. Bhd. (80%)
Educational Trend Sdn. Bhd. (73.72%)
P.T. Intercity Kerlipan (70%)
Motordata Research Consortium Sdn. Bhd. (60%)
ASSOCIATE AND INVESTMENT COMPANIES
Vantage Point Consulting Sdn. Bhd. (50%)
InTech Solutions Pvt. Ltd. (49%)
HeiTech International LLC (40%)
E-Komoditi Sdn. Bhd. (40%)
Peladang HeiTech Sdn. Bhd. (39%)
Fask Capital Sdn. Bhd. (20%)
MSCL Holdings Sdn. Bhd. (19%)
Saeed for Traffic Systems LLC (10%)
Tricubes Berhad (4.89%)
page
HeiTech Padu Berhad
20
Annual Report 2013
HEITECH
GROUP
Company: HeiTech e*Business Solution Sdn. Bhd.
CEO
: Wan Zaidi bin Wan Jaafar
Address
: Level 2, HeiTech Village, Persiaran
Kewajipan, USJ 1, UEP Subang Jaya,
47600 Subang Jaya, Selangor Darul
Ehsan, Malaysia
Phone Number: +(603) 8601 3000/+(603) 8026 8888
Fax Number
: +(603) 8024 5948
Website
: www.heitech.com.my
Company: Integrated Healthcare Solutions Sdn. Bhd.
CEO
: Mohd Sultan bin Abdul Majeed
Address
: D
2-15-3, Jalan Multimedia 7/AJ, Citypark,
i-City 40000 Shah Alam,
Selangor Darul Ehsan, Malaysia
Phone Number: +(603) 8601 3000/+(603) 8026 8888
Fax Number
: +(603) 8024 3140
Website
: www.h2care.com.my
Color code
C: 100% M:96% Y:28%
C: 12% M:58% Y:96%
K:16%
C: 100% M:100% Y:100%
K:100%
K:1%
Company: HeiTech Health Services Sdn. Bhd.
TM
CEO
: Mohd Sultan bin Abdul Majeed
Address
Ehsan, Malaysia
Phone Number: +(603) 8601 3000/+(603) 8026 8888
Colour code:
C: 100% M:96% Y:28%
K:16%
C: 12% M:58% Y:96%
K:1%
C: 52% M:44% Y:44%
K:9%
C: 100% M:100% Y:100%
K:100%
Fax Number
: +(603) 8024 3140
Website
page
www.heitech.com.my
21
Core Business:
Products & Services:
Providing System Integration Services, e-Business
Solutions, Integrated Gateway Services, and Focused
Software Products
• Specialised Electronic Government Solution for
– Immigration Security Document Issuance
– Immigration Border Control Management
– People Registration & Identity Management
Solution
– Managed Applications (Hajj Management, Will
information Management, E-Fund Management,
Pension Management)
• e-Business Solutions
– E-Commerce Business Suite
– Public Service Net (PSN)
• Integrated Gateway Services
– Java Integrated Application Services (JIAS)
• ICT Business Process Outsourcing for Document
Management
• Software Products (Third Party)
– YellowFin Business Intelligence Software
– QlikView Business Intelligence Software
– SunFish Human Resource Management System
– ASAP Asset Management System
• Software Products (In-house built)
–PintarID
Core Business:
Development of Patient Management Software for
clinics and hospitals
Patient Management Software for clinics and hospitals
Industry:
Health informatics
Core Business:
Development and integration of health informatics
solutions
Custom-built health informatics related application,
project management, development, implementation,
maintenance and operation services
Industry:
Health informatics
page
22
HeiTech Padu Berhad
Annual Report 2013
HeiTech
Group
Company: HeiTech Defence System Sdn. Bhd.
CEO
: Azhar Ismail, PMP
Address
Ehsan, Malaysia
Phone Number: +(603) 8601 3236/+(603) 8601 3080,
+(603) 8601 3086 (marketing)
Fax Number
: +(603) 8601 3079
Website
Company: HeiTech i-Solutions Sdn. Bhd.
CEO
: Abdul Halim bin Md Lassim
Address
: G
round Floor, HeiTech Village, Persiaran
Ehsan, Malaysia
Phone Number: +(603) 8601 3000/+(603) 8026 8888
Fax Number
: +(603) 8024 5948
Website
Company: HeiTech Managed Services Sdn. Bhd.
CEO
: Abdul Halim bin Md Lassim
Address
: HeiTech Village 2, No. 1, Jalan Astaka
U8/81, Seksyen U8, 40150 Shah Alam,
Phone Number: +(603) 7843 5000
Fax Number
: +(603) 7843 5228
Website
: http://hms.heitech.com.my
Company: HeiTech TransBiz Sdn. Bhd.
CEO
: Abdullah Ahmad
Address
: Level 12, Menara HeiTech Village,
Persiaran Kewajipan, USJ 1, UEP Subang
Jaya, Selangor Darul Ehsan, Malaysia
Phone Number: +(603) 8601 3391
Fax Number
: +(603) 8024 7997
Website
page
www.heitech.com.my
23
Core Business:
Simulation and Training, Beyond Line of Sight
Communication and Cyber security services
A comprehensive range of products and solutions for
the simulation and training, wireless beyond line of
sight communication technology, electronic engineering
services, security and surveillance technology
Industry:
Defence and Security
Core Business:
Financial Services Solutions Provider
•
•
•
•
•
Industry:
Financial Services Institutions
Comprehensive Core Banking Solutions
Insurance & Reinsurance Core System
Comprehensive Credit Management Solutions
Unit Trust & Investment Management System
Data Reconcilation & Cash Management System
Principal Nature of Business:
Banking (Conventional & Islamic), Insurance &Takaful
Core Business:
ICT infrastructure solutions
Industry:
Financial Services Industry, Manufacturing, Retail and
Public Sector
Principal Nature of Business:
Data Center, Network, Business Recovery Management
Systems, Internet Data Center, Cloud Computing,
Technology Consultancy, ICT Deployment and
Maintenance
• Managed Data Center and Disaster Recovery
Services (i-Sentrix)
• Managed Network & Communications Services
(Padu*Net)
• Desktop Management Services (Padu*DMS)
• Facilities Management Services (i-Sentrix)
• Customer Care/Technical Helpdesk (Padu*Care)
• ICT Deployment (Pro Services)
• Cloud Services (AwanHeiTech)
• Consultancy & Professional Services
Core Business:
IT and Transport related solutions for various segments
of Transport Sector
Providing a wide range of transport related products
and services in four transport segments: road, water,
rail and air, including Road Transport Authority
Management System, Vehicle Integrated Information
System, Border Crossing Management System, Port
Information Management System, Vessel Traffic
Clearance System, Automated Fare Collection System,
Rail Telecommunication System, Passenger Information
System, Computer Based Airport Security Training
System and various ICT services.
Industry:
Automotive
page
24
HeiTech Padu Berhad
Annual Report 2013
HeiTech
Group
Company: Inter-City MPC (M) Sdn. Bhd.
CEO
: Dzulkifli bin Abd Latiff
Address
: N
o. 12, Jalan Anggerik Mokara 31/59,
Seksyen 31, 40460, Shah Alam,
Phone Number: +(603) 5122 9745
Fax Number
: +(603) 5122 4642
Website
: www.intercity.com.my
Company: Cinix 1 Pty. Ltd.
CEO
: Jacqui Neilsen
Address
: P
.O. Box 6234, Logan Central, QLD 4114,
Australia
Phone Number: +(61) 07 3808 6706
Fax Number
: +(61) 07 3208 9904
Website
: www.cinix1.com.au
Company: HeiTech Global Services Sdn. Bhd.
CEO
: Jonas Lind
Address
: Level 15, Menara HeiTech Village, USJ 1,
Persiaran Kewajipan, UEP Subang Jaya,
47600 Selangor Darul Ehsan, Malaysia
Phone Number: +(603) 8601 3000
Fax Number
: +(603) 8023 4051
Website
Company: Pro-Office Solutions Sdn. Bhd.
COO
: Jaafar bin Sarjoo
Address
: N
o. 23, Jalan Juruukur U1/19, HICOM
Glenmarie Industrial Park, 40150 Shah
Alam, Selangor Darul Ehsan, Malaysia
Phone Number: +(603) 5569 5317
Fax Number
: +(603) 5569 4484
Website
: www.prooffice.com.my
page
www.heitech.com.my
25
Core Business:
BPO (Business Processing Outsourcing) both inside and
outside Malaysia
• Variable Data Document Printing (DDP) in both
Black & White with Highlight Color (if need be) and
full digital color
• Mail Processing services for sorting & delivery of
documents printed to General Post Office, which
also includes Letter shopping and Direct Mailers
• Record Management Services (RMS) both physical
& digitisation, complete with the provision of secured
mobile shredding services
Industry:
Financial Services, Insurance, Govt/Semi-Govt/GLC,
SMEs, Automotive, Oil & Gas, Airlines, Retail
Core Business:
Writing & Supporting Software
• FlexiQuote
Software for the Panel Industries from Quoting
through to Accounting
• BodyNet
Software for the Panel Industry – working shop
management system
Industry:
Automotive
Core Business:
To drive and expand HeiTech’s International Business
Products and services under HeiTech Padu Berhad
Core Business:
Variable Data Printing services & Document Handling
Services and courier services
•
•
•
•
Industry:
Financial Services, Insurance, Govt/Semi-Govt, Telco,
GLC
Data & Document Processing
Electronic & Physical Mail Distribution
Mail Room Management
Rendition Services
page
26
HeiTech Padu Berhad
Annual Report 2013
HeiTech
Group
Company: DAPAT Vista Sdn. Bhd.
CEO
: Nabil Abdullah
Address
: 8
42 & 846, Block A, Kelana Center Point,
Jalan SS7/19, 47301 Petaling Jaya,
Phone Number: +(603) 7806 2755
Fax Number
: +(603) 7803 2755
Website
: www.dapat.com
Company: Educational Trend Sdn. Bhd.
CEO
: Kartini binti Mohd Basri
Address
Ehsan, Malaysia
Phone Number: +(603) 8601 3000
Fax Number
: +(603) 8023 4152
Website
: www.edutrend.com.my
Company: PT Intercity Kerlipan
CEO
: Fathony Zakaria
Address
: J l KH. Abdullah Syafei, No 7, Kp. Melayu
Mesar, Jakarta Timur, 13330 Indonesia
Phone Number: +(62) 21 819 5758
Fax Number
: +(62) 21 856 6645
Website
: www.intercity.co.id
page
www.heitech.com.my
27
Core Business:
Mobile Value added Services and Applications
SMS, MMS, USSD, Mobile Application and Mobile
Payment
Industry:
IT
Core Business:
Education, OSS, Mobile and Web development services
provider
Industry:
Education & IT
OSS Development (OSS)
• OSS Web Portal & Application Development
(community or organisation specific)
Training and Certification
• Instructional Training
• E-Learning Solutions (LMS, KMS)
• Assessment Solution
Pre-School and Special Education
• Pre-school and Special Education Solutions
Product Licensing and Subscriptions
• ELLIS (English Language Learning Instruction System)
• A.D.A.M E-Learning for Medical Studies
Mobile Apps and Content Development
• Mobile Development & Application Solution
• Customised Content Development
• Content Management System
• Campus Management System
• Customised Education Programme
• Customised Training Programme
• Change Management Programme
• Curriculum Consultancy
Core Business:
Document and Data Processing, Information Technology
• E-statement Software (I2S)
• Courier monitoring and tracking Software (Info
Track)
• Business Intelligence
• Document Data Processing (DDP)
• IT Outsourcing
• Application Development
• Courier Services
Industry:
Banking & Financial Institutions
page
28
HeiTech Padu Berhad
Annual Report 2013
HeiTech
Group
Company: Motordata Research Consortium Sdn. Bhd.
CEO
: Rossita Abu Hurairah
Address
Ehsan, Malaysia
Phone Number: +(603) 8601 3000/+(603) 8026 1052
Fax Number
: +(603) 8024 3140
Website
: www.mrc.com.my
Company: Vantage Point Consulting Sdn. Bhd.
CEO
: Mohd Saufi bin Hussain
Address
: S
uite C-7-5, Megan Avenue II, No. 12,
Jalan Yap Kwan Seng, 50450 Kuala
Lumpur, Malaysia
Phone Number: +(603) 2176 3008
Fax Number
: +(603) 2176 3018
Website
: www.vantage-intl.com
Company: InTech Solutions Pvt. Ltd.
CEO
: Nayana DP Dehigama
Address
: E
pic Techno-Village 158/1/A, Kaduwela
Road Thalangama, Battaramulla 10120,
Sri Lanka
Phone Number: + (94) 11 288 7787
Fax Number
: + (94) 11 288 7727
Website
: [email protected]
Company: HeiTech International LLC
Address
: N
o 704, ICON Tower, Tecom-C, P.O. Box
454956 Dubai, United Arab Emirates
Phone Number: +(971) 4 454 1088/+(971) 4 454 1077
Fax Number
: +(971) 4 454 1066
Website
: www.heitech-intl.com
page
www.heitech.com.my
29
Core Business:
National centralised parts prices and repair times
database for industry reference
•
•
•
•
•
Industry:
Insurers and Takaful Operators, Vehicle Manufacturers
and Distributors, Collision Repair Stakeholders/
Workshops
Core Business:
Business Consulting Services, SAP Implementation,
Outsourcing and Managed Services and SuccessFactors
on the Cloud
Industry:
SAP – almost all industries;
Vantage Point – Government,
Telecommunications, Utilities & Services
GLCs,
Motor Parts Prices and Repair Times Database
Parts Analysis Reports
Automotive Claims Monitor
Insurance Claims Report
Collision Repair Industry training programs and skills
training
SAP solutions for:
• Enterprise Resource Planning (general back-office
solutions for Financial, Logistics, Human Resources,
Manufacturing)
• Industry solutions (Oil & Gas, Health Care,
Educations, Military, etc)
• Supplier Relationship Management/eProcurement
• Supply Chain Management
• Customer Relationship Management
• Business Objects/Intelligence
• SuccessFactors on the Cloud
Core Business:
Data Center, Disaster Recovery & Business Continuity
Managed Services
• Disaster Recovery Facilities
• Data Center
• Business Continuity Managed Services
Industry:
Information and Communication Technology
Core Business:
Marketing and Business Development – Information
Technology
Government Solutions, focusing in the following sectors:
• Transportation, Homeland Security (Immigration and
Identity Management), Education, Healthcare,
Defense
• Incident Management System
• Traffic & Road Safety Solution
• Electronic Warehousing
• Control Center
• Car Rental Hub
Industry:
Automotive
page
30
HeiTech Padu Berhad
Annual Report 2013
HeiTech
Group
Company: E-Komoditi Sdn. Bhd.
CEO
: S. Sivaji
Address
: S
uite 4B, Level 4, Menara KLK, No. 1,
Jalan PJU 7/6, Mutiara Damansara,
47810 Petaling Jaya, Selangor Darul
Ehsan, Malaysia
Phone Number: + (603) 7728 1088
Fax Number
: + (603) 7728 4188
Website
: www.ekomoditi.com.my
Company: Peladang HeiTech Sdn. Bhd.
Peladang
HeiTech
CEO
: Hj Ahmad Puzi Bin Abu Bakar
Address
: 5
01, Block A, Kelana Center Point, No. 3,
Jalan SS7/19, 47301 Petaling Jaya,
Phone Number: +(603) 7805 4394/95
Peladang
HeiTech
Fax Number
: +(603) 7805 4715
Website
: www.pheitech.com.my
Company: Fask Capital Sdn. Bhd.
CEO
: Dato’ Nik Mod Amin
Address
: H
-2-06 & H-2-07, Jalan SS6/16A, Dataran
Glomac, Kelana Jaya, 47301 Petaling
Jaya, Selangor Darul Ehsan, Malaysia
Phone Number: +(603) 7880 9178
Fax Number
: +(603) 7880 9127
Website: www.rmex.com.my
Company: MSCL Holdings Sdn. Bhd.
CEO
: Steve Miller
Address
: Suite 5.01, HeiTech Village, Persiaran
47600 Selangor Darul Ehsan Malaysia
Phone Number: +(603) 8600 2088
Fax Number
: +(603) 8600 2082
Website
: www.mscl.com.my
page
www.heitech.com.my
Core Business:
Software Development and Consulting Services
Industry:
ICT, Agriculture, Oil and gas, Manufacturing
Malaysian Plantation Management System – GIS
Integrated Plantation Productivity Management Solution
Core Business:
Engage in Software Development and Provisions of
Web-Based Applications System and Related Traning
Activities
Industry:
ICT
31
• eTX – B2B Platform. A comprehensive, secured endto-end procurement solution for business where the
Buyers and Suppliers are seamlessly integrated
• eCTS – Electronic Commodity Trading System
• SCADA Integrated Hydroponic and Aqua farming
Solutions
• Outsourcing, In-Sourcing and managed Services
• Professional Services
• EA and ISP Consulting Services
• GIS and Remote Sensing System Development and
Consulting Services
• Printed Documents
• Hardware – Server & Printer
• Primary System for Pertubuhan Peladang
• The Federal Government System for Fertilisers
• System Integration for PPN Machinery
• Primary POS
• Bulk SMS
• Profiling System of Ahli Peladang
• PESAN A SPPP 2014
• AMS SBPKP
• LPP Website & Email
• SPPP Laboratory
Core Business:
To carry on business of franchiser in all kinds of financial
services and financial agents
Corporate Finance & Financial Advisory
Industry:
Financial Institutions
Core Business:
Automotive Software
•
•
•
•
Industry:
Automotive
Motor insurance claims
Bodyshop management
CRM and industry data analysis programmes
Information Technology Specialists and Consultants
page
32
HeiTech Padu Berhad
Annual Report 2013
HeiTech
Group
Company: Saaed For Traffic Systems LLC
CEO
: Ibrahim Yousef H. Ramel
Address
: S47, SE14, Khalifa City A, Abu Dhabi, UAE
Phone Number: + (971) 2 4149 999
Fax Number
: + (971) 2 5563 333
Website
: www.saaed.ae
Company: Tricubes Berhad
CEO
: Khairun bin Zainal Mokhtar
Address
: S
uite 13.1, Level 13, Menara Great
Eastern, 303 Jalan Ampang, 50450 Kuala
Lumpur, Malaysia
Phone Number: +(603) 4264 4000
Fax Number
: +(603) 4264 4100
Website
: www.tricubes.com
page
www.heitech.com.my
33
Core Business:
Accidents reporting, Traffic and roads services
• Managing accident systems the reconstruction of
simple accident scene and defining legal liability
• Supply and Deploy of Inspectors and Supervisors
(Officers) for Control and Manage Paid Parking
• Providing Freeway Patrol Service, traffic escort
services and road safety
• Managing monitoring Portal of all processes related
to vehicles
• Intelligent traffic solutions
Industry:
Automotive, Traffic
Core Business:
Identity Authentication and Mobility solutions
Hardware
• Ruggedised Handled Computer with Smartcard and
Biometric
• Ruggedised Handled Computer with Barcode
Scanner
• Smartcard Expansion Module for HP iPAQ 912
• Smartcard & Biometric Access Control System
• Desktop Smartcard & Biometric Reader
• Desktop Smartcard Reader
Industry:
Government, Financial Services Institutions,
Telecommunications
Software
• Identity Authentication Middleware for Smartcard &
Biometric base System
• Enterprise Mobile Middleware System
• Mobile Software as a Service
• Mobile enforcement, Mobile Banking, MyKad
Authentication
• Visitor Management for Desktop
• Smartcard & Biometric Reader
page
HeiTech Padu Berhad
34
Annual Report 2013
SOLUTIONS
& SERVICES
As a Global IT Systems and Technology Services
Provider, HeiTech has developed a comprehensive
suites of solutions and services that are holistic,
integrated and cutting-edge, covering the entire life
cycle of systems, infrastructure and product
development.
CORE CAPABILITIES
1) S Y S T E M I N T E G R A T I O N
DEVELOPMENT
&
APPLICATION
One size does not fit all and that is why we
provide end-to-end customised solutions that meet
our clients’ specific needs. We use a threepronged approach which are formulating
strategies that best answer the requirements of
our clients, developing application systems, and
finally, integrating systems of different platforms.
Being an end-to-end solution provider, we offer
complete project implementation services which
includes project management services, systems
management services, deployment services, user
training, and post implementation support
services.
We are committed to providing 99.8% network
service availability to our clients, at all times.
This commitment is realised through our
centralised monitoring and around-the-clock
customer service.
We also assist our clients to develop, build and
manage network infrastructure and services.
Our set of network services consists of the
followings technologies:
• Internet Protocol Virtual Private Network
(IPVPN)
• IP Broadband (DSL)
•Optical
• Metro Ethernet
2) IT INFRASTRUCTURE SOLUTIONS
DATA CENTER SERVICES
We own and manage a Tier-IV ready Data
Centre providing world class services of
developing, building and managing data
centre facilities for our clients.
The combination of experience and technical
certification such as Information Security
Management System (ISO/IEC 27001:2005),
Quality Management System (ISO/IEC
9001:2008) and Information Technology Service
Management System (ISO/IEC 20000-1:2011)
has enabled us to provide a high standard of
quality that meets the demand of organisations
in terms of service level, availability, data
integrity and security.
Our suite of Data Centre Services consist of:• Internet Data Centre Services
NETWORK SERVICES
As Malaysia’s largest non-telecommunications
service provider, our network services support
multi-protocol applications in one secured
private network. Our network infrastructure also
consists of multiple telecommunications and
trunk carriers. This network diversity enables us
to offer excellent connectivity and availability
to our clients.
•3G
•4G
CLOUD COMPUTING SERVICES
We offer flexible cloud computing services,
tailored to our client’s specific business
requirement - from building a private cloud,
hosting cloud infrastructure to managing
shared cloud services. Our cloud computing
services help streamline clients’ budgets as
they are economically-friendly on capital
expenditure, hardware refresh cycles and
hardware-software operations and maintenance
expenses.
Our suite of cloud services consists of:• Infrastructure as a Service
– Virtual Private Server
– Virtual Private Data Centre
• Data Centre Management Services
• Storage as a Service
• Infrastructure Development & Management
Services
• Disaster Recovery as a Service
• Data Protection as a Service
• Business Recovery Management Services
• Desktop as a Service
• Security as a Service
page
www.heitech.com.my
INDUSTRY FOCUS
Capitalising on over two decades of experience in
both public and private sectors, we have diversified
our solutions to include industries such as National
Security, Transport, Financial Services, Healthcare, and
Defence.
35
DEFENCE
• Simulated Interactive Maintenance Aid
• Integrated Training & Tactical Command Control
System
• Security Assessments Services
• Weapon Management & Surveillance System
OUR SPECIFIC SOLUTIONS
NATIONAL SECURITY
• PINTAR ID
– People Registration & Life Cycle Information
Management
– Population Information Exchange System
– Immigration Border Control Management
– Immigration Travel Document Production and
Issuance
VALUE-ADDED BUSINESSES
Our expertise goes far beyond our traditional range of
products and services. We offer our clients a
comprehensive range of value-added services that
meet their needs.
ENTERPRISE SOLUTIONS
• SAP Suite of Product
• Identity Authentication & Mobility Solutions
TRANSPORT
• Road Transport Authority Management System
(RTAMS)
• Electronic Commerce
• Vehicle Information System Integration (VISI)
CONTENT DEVELOPMENT
• Web Portal Application Development
• Driver Information System
• Fuel Management System
• Fleet Management System
• Automatic Number Plate Recognition
• Middleware Products
• Interactive Product Training
• Mobile Application Solutions
• Single Window Ship Clearance System
BUSINESS PROCESS OUTSOURCING
• Manual Mail Processing
• Maritime and Port Logistics Solution
• Electronic Bill Presentment
• Automatic Fare Collection
• Record Management Services
• X-Screen Computer Based Training
• Digital Printing Services
• Aviation Lighting Solution
• Will Document Management
FINANCIAL SERVICES
• Islamic Integrated Computerised Banking System
OTHER e-GOVERNMENT RELATED SOLUTIONS
• Inter-Agency Link-Up System
• Conventional Integrated Computerised Banking
System
• Pension Management System
• Insurance & Reinsurance Integrated System (Life,
General, Takaful)
• Postal Management System
• Credit Management Solutions
• Investment Management System
HEALTHCARE
• Hospital Information System
• GP Clinics Patient Management System
• Hajj Management System
page
36
HeiTech Padu Berhad
Annual Report 2013
BOARD OF
DIRECTORS
From Left to Right: Dato’ Dr. Mohamed Ariffin Bin Aton, Dato’ Mohd Fadzli Bin Yusof,
Tan Sri Dato’ Sri Abi Musa Asa’ari Bin Mohamed Nor
page
www.heitech.com.my
37
From Left to Right: Haji Ghazali Bin Awang, Syed Agel Bin Syed Salim,
Sulaiman Hew Bin Abdullah, Ahmad Noor Bin Sulong (Group Company Secretary),
Dato’ Mohd. Hilmey Bin Mohd Taib
*Not in the picture – Wan Ainol Zilan Binti Abdul Rahim
page
38
HeiTech Padu Berhad
PROFILE OF
DIRECTORS
DATO’ MOHD HILMEY BIN MOHD TAIB
S.I.M.P, D.I.M.P, S.M.P
(Aged 61 – Malaysian)
MBA, Cranfield Institute of Technology, United Kingdom.
MSc. in Management & Strategic Entrepreneurship,
Nottingham Trent University, United Kingdom. Bachelor of
Economics (Hons) Accounting, University of Malaya.
Chartered Accountants, Malaysian Institute of Accountants
(MIA)
HAJI GHAZALI BIN AWANG
Bachelor of Commerce, University of Newcastle N.S.W.
Australia. M.A Institute Agama Islam Negeri, Imam Bonjol,
Padang. Member of Malaysian Institute of Accountants
(MIA), Chartered Accountant (Australia)
Annual Report 2013
page
www.heitech.com.my
Dato’ Mohd
Berhad and
Company on
the Voluntary
39
Hilmey is Chairman of HeiTech Padu
was appointed to the Board of the
5 August 1994. He is also a member of
Separation Scheme (VSS) Committee.
Prior to joining HeiTech, he has helmed several
leadership positions in Permodalan Nasional Berhad
(PNB). The last position held in PNB was as Group
Chief Executive, from 1995 to 1997. Throughout his
career, Dato’ Mohd Hilmey has also held several
directorships in public listed companies such as
Malayan Banking Berhad, Kuala Lumpur Kepong
Berhad, KFC Holdings (M) Berhad, Maxis
Communications Berhad, Pasdec Holdings Berhad
and several other private companies of various
industries prior to focusing on HeiTech Group.
Haji Ghazali was appointed as Director of HeiTech
Padu Berhad on 8 March 2005. He serves as Chairman
of the Audit Committee and is a member of the
Nomination and Remuneration Committee. He also
serves as a member of Voluntary Separation Scheme
(VSS) and Employee Share Option Scheme (ESOS)
Committees.
He started his career as an accountant with Messrs.
Wilson, Bishop, Bowes & Craig, Chartered Accountants,
Australia. Haji Ghazali has vast experience in
accountancy, financial operations, investment and
corporate services both in the public and commercial
sectors. Before retiring, he served as the Group
Director, Finance and Corporate Services of Kumpulan
Guthrie Berhad.
Currently, he serves as Chairman of the Board of
Directors of Universiti Malaysia Pahang (UMP). He is
also a director in KIC Oil & Gas Ltd Labuan, Fask
Capital Sdn. Bhd. and several subsidiaries within
HeiTech Group.
Dato’ Mohd Hilmey attended all of the six (6) Board
Meetings held during the financial year ended
31 December 2013.
His current directorships in other public companies are
in Prudential BSN Takaful Berhad, BIMB Investment
Management Berhad, Bank Simpanan Nasional,
Lembaga Tabung Haji Malaysia and CCM Duopharma
Biotech Berhad.
Haji Ghazali attended all of the six (6) Board Meetings
held during the financial year ended 31 December
2013.
page
40
HeiTech Padu Berhad
Profile of
Directors
Associate Member, Institute of Chartered Secretaries and
Administrators
DATO’ MOHD FADZLI BIN YUSOF
D.P.M.T.
Diploma in Communications, Advertising and Marketing
from the Communication, Advertising and Marketing
Foundation United Kingdom
Annual Report 2013
www.heitech.com.my
Syed Agel was appointed as Director of HeiTech Padu
Berhad on 1 January 1995. He serves as a member of
the Audit Committee.
He started his career with the Auditor General’s Office
in 1969. He served Dunlop Malaysian Industries Berhad
in 1974 and after nine (9) years of service in various
capacities, he then joined Permodalan Nasional
Berhad (PNB) in 1983 as the Finance and Management
Audit Manager and served PNB for seventeen (17)
years. He subsequently retired as a General Manager
of Amanah Saham Nasional Berhad in July 2000.
Dato’ Mohd Fadzli was appointed as Director of
HeiTech Padu Berhad on 7 October 2005. He serves as
Chairman of Risk Management Committee.
He started his career in broadcasting with Radio
Malaysia and joined British Broadcasting Corporation,
United Kingdom from 1970 to 1976. He was appointed
as Head of Marketing for Bank Bumiputra (M) Berhad
from 1976 to 1981. He then joined Malaysian National
Insurance Sdn. Bhd. as Deputy General Manager and
later moved to Bank Islam Malaysia Berhad as General
Manager in 1984 specifically to set up the first
Malaysian takaful operation. He left Bank Islam
Malaysia Berhad to spearhead Syarikat Takaful
Malaysia Berhad as the Chief Executive Officer and
Director until September 2005.
page
41
His directorship in other company within the HeiTech
Group is in Inter-City MPC (M) Sdn. Bhd.
He attended all of the six (6) Board Meetings held
during the financial year ended 31 December 2013.
He is currently a member of the Board of Trustees,
Sultan Mizan Royal Foundation, a member of the
Board of Directors, Mains Zakat Sdn. Bhd., and the
Academic Fellow of University College Insaniah, Kedah.
He also serves as member of the Board of Directors,
Amana Takaful PLC, Sri Lanka and Amana Takaful
Maldives Ltd.
His directorships in other companies within the HeiTech
Group are in HeiTech i-Solutions Sdn. Bhd. and
Motordata Research Consortium Sdn. Bhd.
Dato’ Mohd Fadzli attended all of the six (6) Board
Meetings held during the financial year ended
31 December 2013.
page
42
HeiTech Padu Berhad
Profile of
Directors
TAN SRI DATO’ SRI ABI MUSA ASA’ARI BIN
MOHAMED NOR
P.S.M, S.S.A.P, S.I.M.P, D.I.M.P, S.M.P
MBA University of Birmingham United Kingdom, Bachelor of
Economics (Hons) University of Malaya, D.D.A University of
Birmingham, United Kingdom
DATO’ DR. MOHAMED ARIFFIN BIN ATON
D.S.S.A
BSC. (Hons) in Chemical Engineering, Certificate of
Professional Orientation, Certificate Process Engineering,
Certificate Refinery Economics and PhD in Chemical
Engineering
Annual Report 2013
www.heitech.com.my
Tan Sri Dato’ Sri Abi Musa Asa’ari was appointed as
Director of HeiTech Padu Berhad on 17 October 2006.
He serves as a member of the Nomination and
Remuneration and Employee Share Option Scheme
(ESOS) Committees.
He started his career in the Malaysian Civil Service as
Assistant Director in the Public Service Department in
1973. He then served in the National Bureau of
Investigation, National Institute of Public Administration
and Petroleum Development Unit of the Prime Minister’s
Department before being appointed as the Deputy
Budget Director in the Ministry of Finance in 1995. In
1998, he joined Federal Agriculture Marketing Authority
(FAMA) as the Director General and subsequently as
Secretary General at the Ministry of Agriculture and
Agrobased Industry from 2001 before he retired in
2006.
Dato’ Dr. Mohamed Ariffin has been appointed as
Director of HeiTech Padu Berhad on 5 September
2011. He serves as a member of Risk Management
Committee.
He started his career with ESSO Refinery as a Process
Engineer from 1970 until 1972. He then served Institute
Technology Mara in 1971 as a Part-Time Lecturer and
later joined University Kebangsaan Malaysia for almost
18 years. In 1989, he joined Petronas Research &
Scientific Services Sdn. Bhd. and was the Managing
Director from 1993 to 1996 before joining Standards
and Industrial Research Institute of Malaysia (SIRIM)
Berhad as the President and Chief Executive from 1996
to 2007.
page
43
He is currently the Chairman of Universiti Pendidikan
Sultan Idris. His current directorships in other public
and private companies include in Lembaga Koko
Malaysia, Konsortium Perikanan Nasional Berhad,
Pelikan International Corporation Bhd. and Platinum
Energy Sdn. Bhd.
Tan Sri Dato’ Sri Abi Musa Asa’ari attended five (5)
Board Meetings held during the financial year ended
31 December 2013.
His current directorships in other public and private
companies are in Kumpulan Peransang Selangor
Berhad, Perisai Petroleum Teknologi Berhad, Malaysian
Technology Develoment Corp Sdn. Bhd., Core
Competencies Sdn. Bhd., Gryphon Energy Sdn. Bhd.,
Neural Manufacturing Sdn. Bhd., KASS International,
MTN Sdn. Bhd., Senstech Sdn. Bhd., UNISEL and
National Measurement Centre.
Dato’ Dr. Mohamed Ariffin attended all of the six (6)
Board Meetings held during the financial year ended
31 December 2013.
page
44
HeiTech Padu Berhad
Annual Report 2013
Profile of
Directors
Barrister-at-Law, Lincoln’s Inn London
Sulaiman Hew was appointed as a Director of HeiTech Padu Berhad on 30 July 2013. He also serves as a
member of Nomination and Remuneration Committee with effect from 17 April 2014.
He was called to the Bar in 1975 and commenced practice in the same year. He is currently the Managing
Partner and also the Founder Partner of Hamzah, Sulaiman & Partners. Prior to joining HeiTech, he served as an
independent director on the board of several public listed companies including Trinity Corporation Berhad,
Ganad Corporation Berhad and Europlus Berhad.
Sulaiman Hew attended three (3) Board Meetings held during the financial year ended 31 December 2013.
Bachelor Degree of Accounting (Hons), University of Malaya. Master Degree in Commerce, University of New South Wales,
Australia. Diploma in Islamic Studies, International Islamic University Malaysia. Member of Malaysian Institute Accountants. Past
member of Australian CPA and The Institute of Internal Auditors Malaysia
Wan Ainol Zilan was appointed as a Director of HeiTech Padu Berhad on 6 August 2013. She serves as a
member of the Audit Committee.
She currently serves as a Director of MayQuest Sdn. Bhd. Wan Ainol Zilan joined Permodalan Nasional Berhad
as system accountant and her last position was as the Head of Finance and Administration. Prior to joining
MayQuest, she served Cycle & Carriage Group of Companies as the Group Internal Auditor.
Wan Ainol Zilan attended three (3) Board Meetings held during the financial year ended 31 December 2013.
None of the Directors has:
• Any family relationship with Director and/or major shareholders of HeiTech Padu Berhad, except Syed Agel bin Syed Salim
and Dato’ Dr. Mohamed Ariffin bin Aton by virtue of being Nominee Directors of Permodalan Nasional Berhad.
• Any conflict of interest with HeiTech Padu Berhad.
• Any convictions for offences within the past ten (10) years other than traffic offences.
page
www.heitech.com.my
45
PROFILE OF GROUP
COMPANY SECRETARY
AHMAD NOOR BIN SULONG
Group Company Secretary (MAICSA 7062155)
Bachelor of Laws (Hons), MIM-CPIPM
Ahmad Noor, currently serves as the Group Company
Secretary of HeiTech Padu Berhad. He is an Associate
Member of the Malaysian Institute of Chartered
Secretaries and Administrators (MAICSA), and has vast
experience across diversified industries including
publishing, newspaper, construction, and card
services.
Ahmad Noor is also the Group General Counsel,
leading the legal affairs, intellectual property and
regulatory compliance portfolio.
page
HeiTech Padu Berhad
46
Annual Report 2013
EXECUTIVE
COMMITTEE
Dato’ Mohd Hilmey
Bin Mohd Taib
Chairman
Harris Bin Ismail
Zohan Zuki Bin Mohd Zuki
page
www.heitech.com.my
DATO’ MOHD HILMEY BIN
MOHD TAIB
Chairman
Dato’ Mohd Hilmey’s profile is
contained in the “Profile of Directors”
section as set out on pages 38 to
39 of this Annual Report.
47
HARRIS BIN ISMAIL
ZOHAN ZUKI BIN MOHD ZUKI
MBA, Southern California University, USA.
Bachelor of Law (Honours), Universiti
Kebangsaan Malaysia.
Prior to joining the HeiTech Group
in 2000, Harris was involved in
various industries including finance
and securities, manufacturing,
construction and educational
services.
Starting as a Business Strategist in
Padusoft, previously a wholly-owned
subsidiary of HeiTech, he was later
appointed as Senior Vice President
for Corporate Development of
HeiTech in 2005 and was later in
charge of the non-core IT business
in 2006. After successfully
transforming the Group and
improved profit contribution, he
was appointed as the CEO of
HeiTech e*Business Solution Sdn.
Bhd. in 2009, focusing on the
development of the Homeland
Security, Defence, Healthcare and
Education sectors.
At the end of 2011, Harris was
appointed as the Group CEO of
HeiTech to oversee the development
of HeiTech Group especially on the
development of the overseas
market.
Zohan is currently the Group Chief
Operating Officer of HeiTech and
responsible for driving the business
operation of HeiTech Group. He
brings more than twenty (20) years
of experience from the legal and
financial industry and has served in
various management positions,
focusing on legal affairs, investment
services and investor relations.
He started his career as an
advocate and solicitor with leading
corporate law firm Messrs. Zuki,
Gandhi & Amin. Prior to joining
HeiTech, Zohan served Hwang-DBS
Securities Berhad as an Assistant
Manager of Compliance and
Legal. His career in HeiTech began
as the Head of Investment Services
& Investor Relations in 2002. In
2004, he was appointed as
Executive Director for Inter-City MPC
(M) Sdn. Bhd., a subsidiary of
HeiTech and later was promoted to
the position of Managing Director
in 2007.
page
48
HeiTech Padu Berhad
Annual Report 2013
Executive
Committee
Wan Zaidi Bin Wan Jaafar
Ahmad Bin Abdul Ghani
Chief Executive Officer, HeiTech
e*Business Solution Sdn. Bhd.
Ahmad Nasrul Hakim
Bin Mohd Zaini
Abdul Halim Bin Md Lassim
Chief Executive Officer, HeiTech
Managed Services Sdn. Bhd., and
HeiTech i-Solutions Sdn. Bhd.
page
www.heitech.com.my
49
AHMAD NASRUL HAKIM BIN MOHD ZAINI
AHMAD BIN ABDUL GHANI
Chartered Accountant, Malaysian Institute of Accountant
(MIA). CPA Australia.
Bachelor of Commerce (Accounting), University of New South
Wales, Sydney, Australia.
Bachelor of Arts with honours in Psychology, Universiti
Kebangsaan Malaysia.
Nasrul joined HeiTech in 2002 and was appointed as
Vice President of Group Finance Services Division in
2008 and later as Chief Financial Officer in 2009. Prior
to HeiTech, he had worked with Deloitte Malaysia
where he managed financial assurance, business
advisory and consulting engagements for clients from
manufacturing, property and banking industries.
Actively involved in NGOs, he currently acts as an
advisor to Dyslexia Association dedicated to enhance
the gifts of dyslexic children through information
technology.
Ahmad is the Director of Corporate Services and also
serves as the Chief Executive Officer of HeiTech
Academy. He has thirty (30) years of experience in
human resource management and development
across diversified industry including banking,
manufacturing, and services in local and multinational
companies.
ABDUL HALIM BIN MD LASSIM
WAN ZAIDI BIN WAN JAAFAR
Chief Executive Officer, HeiTech Managed Services Sdn. Bhd.,
and HeiTech i-Solutions Sdn. Bhd.
Chief Executive Officer, HeiTech e*Business Solution Sdn. Bhd.
Bachelor of Arts in Social Studies with honours in Accountancy
Studies from the University of Exeter, United Kingdom.
Chartered Accountant, Malaysian Institute of Accountants.
Certified Public Accountant, Malaysian Institute of Certified
Public Accountants.
Abdul Halim joined HeiTech in 2000 as Finance
Manager responsible in assisting HeiTech during its
flotation exercise. Prior to joining HeiTech, Abdul Halim
was attached to Hanafiah Raslan and Mohammad for
five (5) years performing auditing, corporate finance
and corporate recovery related assignments. In
HeiTech, he served as Chief Financial Officer and Vice
President in 2002 and later promoted to Senior Vice
President in 2005. In 2008, he was appointed as CEO
of HeiTech Managed Services (HMS), focusing on endto-end ICT Infrastructure solutions. In 2013, he was also
entrusted as CEO of HeiTech i-Solutions Sdn. Bhd. to
oversee the financial services industry.
Abdul Halim is a council member of the Malaysian
Institute of Certified Public Accountants (MICPA) and
also serves as the Chairman of the Young Certified
Public Accountants of MICPA.
Bachelor of Science in Education (Hons) and Major in
Mathematics, University of Malaya.
Wan Zaidi began his career in Permodalan Nasional
Berhad (PNB). In his three decades of service with PNB
and HeiTech, he has held several senior positions in
both organisations. Wan Zaidi has been directly
involved in the transformation programs of the public
sector, particularly the Road Transport Department, the
Immigration Department and the National Registration
Department.
Wan Zaidi is currently tasked to lead HeiTech e*Business
Solution (HeB), to explore and create new business
areas with internet technologies through web based
services for the public and private sectors.
page
50
HeiTech Padu Berhad
Annual Report 2013
OUR
ACCOLADES
Innovative Company of the Year Award (Information
Security) by Cyber Security Malaysia (2010 & 2012)
ISO/IEC 27001:2005 Information Security
Management System Certification (since 2006)
Certificate of Merit at NACRA (2006, 2007, 2010 &
2011)
Capability Maturity Model Integration (CMMI) Level 3
Certification (since 2006)
ISO/IEC 20000-1:2005 Information Technology Service
Management System (since 2010)
3 Stars Award National Quality Control Circle (2003)
Industry Excellence Award (Industrial Products &
Technology) at National Annual Corporate Report
Awards (NACRA) (2008 & 2009)
MIM Silver Award (2008)
Frost & Sullivan Malaysia Telecoms Award (2007)
Best Exhibition Booth Award Minggu Saham Amanah
(2002)
Enterprise 50 Award (1999 & 2000)
MS ISO 9001:2008 Quality Management Systems
Certification (since 1998)
page
www.heitech.com.my
51
Indirectly contributed to the success of our
client, Public Service Department in
achieving:-
client, Immigration Department of Malaysia
in achieving:-
• IT Premier Award for Public Sector (2006)
– Pensions Online Workflow Environment
System (POWER)
• MS ISO 9002 Certification for passport
processing
client, National Registration Department in
achieving:• ISO/IEC 27001:2005 Information Security
Management System Certification (2009)
• IT Premier Award (2000)
• The Prime Minister’s IT Award (2000)
• Best Call Centre Services Award (2000)
• Home Ministry Quality Award
• IT Premier Award (1999)
client, Road Transport Department in
achieving:• PIKOM (Computer Industry’s Association
of Malaysia) Award (1997)
• Public Service Innovation Award (1996)
• Special Public Service award for IT (1995)
page
52
HeiTech Padu Berhad
Annual Report 2013
SIGNIFICANT
EVENTS
15 May 2013
Blood Donation Drive
(Lobby, Menara HeiTech Village)
HeiTech blood donation drive was initiated in
collaboration with the National Blood Centre to
increase awareness on the need and the importance
of blood donation among the staff.
18 June 2013
Special Japanese Delegation Visit to MRC Malaysia
(Menara HeiTech Village, Subang Jaya)
HeiTech through its subsidiary company, Motordata
Research Consortium (MRC) had received a special
business visit from delegations of The Jiken Centre
Co. Ltd, a business partner based in Japan on
18 June 2013. They were briefed on HeiTech’s
expertise and experience particularly on the facilities
and infrastructure of HeiTech Data Centre.
26 June 2013
HeiTech Padu Berhad 18th Annual General Meeting
(Grand Dorsett Subang Hotel, Subang Jaya)
HeiTech Padu Berhad held its 18th Annual General
Meeting (AGM) at Grand Dorsett Subang Hotel,
Subang Jaya on 26 June 2013.
page
www.heitech.com.my
53
11 July 2013
Majlis Semarak Ramadan HeiTech
(Menara HeiTech Village, Subang Jaya)
HeiTech held its Majlis Semarak Ramadan
which was attended by members of the
Board of Directors, as well as Management
and staff, at Level 9, Menara HeiTech Village.
Staff had the privilege of listening to a lecture
on Ramadan by Sheikh Mohammed Abdul
Aziz Ghonim, Mufti Tanta, Egypt.
24 August 2013
‘Rumah Terbuka Aidilfitri Bersama Pelanggan 1434H’ (Dewan
Sri Siantan, Putrajaya)
HeiTech organised its Rumah Terbuka Aidilfitri Bersama
Pelanggan 1434H at Dewan Sri Siantan, Putrajaya which
hosted over 1200 guests consisting of customers and corporate
partners. They were feted with varieties of traditional food and
also entertained by guest artists with Hari Raya and
contemporary songs.
30 August 2013
Majlis Jasamu Dikenang, Tuan Haji Safiee
Mohamed (Menara HeiTech Village, Subang
Jaya)
HeiTech hosted a farewell ceremony for its
former Executive Director, Tuan Haji Safiee
Mohamed who retired on 31 August 2013.
The ceremony was attended by the Chairman,
Executive Committee Members along with
staff members.
page
54
HeiTech Padu Berhad
Annual Report 2013
Significant
Events
11 September 2013
Special Visit by H.E U Aye Myint, Minister of Republic
of Union of Myanmar (Menara HeiTech Village,
Subang Jaya)
On 11 September 2013, HeiTech had received a special
business visit from a Minister of Republic of Union of
Myanmar, H.E U Aye Myint, and his entourage
delegation as a way to promote HeiTech products and
services to overseas potential customers.
18 September 2013
Appreciation Ceremony to HeiTech BODs (Grand
Dorsett Hotel, Subang Jaya)
HeiTech bids farewell to three members of its Board
of Directors; Dato’ Ab Halim Mohyiddin, Ou Shian
Waei and Tuan Haji Safiee Mohamed through a
small but intimate farewell dinner at Grand Dorsett
Hotel Subang.
30 November 2013
Academic Visit from UiTM Shah Alam, Selangor
HeiTech is honored to received an academic visit by a
group of Information Technology students of UiTM Shah
Alam, Selangor. The final year students visited HeiTech
to get some insights and inputs in order to complete
their final year project.
www.heitech.com.my
8 December 2013
Flood Aid Mission
(Lobby, Menara HeiTech Village)
As a responsible corporate citizen, HeiTech
made financial contribution for essential
supplies and facilitation of relief work to flood
victims, during the second wave of floods at
the affected areas in the East Coast.
12 January 2014
HeiTech Kick-off 2014
(The Summit Hotel, Subang Jaya)
HeiTech started-off the year with its annual
kick-off event with the theme “Accelerating
Growth-Be Creative, Be Innovative”. The event
was attended by the staff and management
of HeiTech Group.
6 March 2014
Bowling Tournament
(Ampang Bowl, Summit USJ)
Kelab Kakitangan HeiTech organised a
bowling tournament for the staff in its
continuous effort of promoting work-life
balance.
page
55
page
56
HeiTech Padu Berhad
Annual Report 2013
CORPORATE
MILESTONES
1990
+
1995
2000
+
1994
1999
2003
• The Company began its journey
as an Electronic Data Processing
Division (EDP) of Permodalan
Nasional Berhad (“PNB”). The
EDP division was then
incorporated under the name of
PNB Training and Resort
Management Sdn. Berhad and
became a wholly-owned
subsidiary of PNB.
• The Company changed its
name to HeiTech Padu Sdn.
Berhad following the strategic
transition (“MBO”) and the drive
to keep abreast with rapid
changes in the competitive
global IT business.
• Launched of Employee Share
Option Scheme.
• The Company secured an IT
outsourcing contract from PNB.
2004
1995
name to PNB Information
Technologies Sdn. Berhad (“PNB
IT”).
1997
• The Company underwent a
Management-Buy-Out (“MBO”),
through Padujade Corporation
Sdn. Bhd., acquired 65% of
shares from PNB, becoming the
holding company of PNB IT.
1998
• T h e C o m p a n y b e g a n i t s
metamorphosis into an
independent commercial entity.
PNB IT was retained as the name
of the Company.
• PNB IT obtained its MS ISO
9001:2000 Quality Management
Systems Certification from SIRIM
QAS International.
2000
name to HeiTech Padu Berhad
(HeiTech), in line with its status
as a public listed company.
HeiTech began its first trading
on the main board of the Kuala
Lumpur Stock Exchange (“KLSE”)
currently known as Bursa
Malaysia Securities Berhad.
2002
• Operated from its new corporate
headquarters, Menara HeiTech
Village in USJ 1, Subang Jaya.
• R a t i o n a l i s a t i o n o f H e i T e c h
Subsidiaries.
• Secured the first international
project from the Department of
Immigration and Emigration Sri
Lanka.
• Diversified its business with the
acquisition of Inter-City MPC (M)
Sdn. Bhd., a business process
outsourcing company.
2005
• Implementation of Key Results
Area and Key Performance
Indicators.
2006
• Ventured into electronic media
and content development
business through the acquisition
of Electronic Media Airtime
Services Sdn. Bhd.
• HeiTech became the first local IT
company to be certified with
Information
Security
Management System (“ISMS”)
(ISO/IEC 27001:2005) from SIRIM
QAS International.
page
www.heitech.com.my
+
57
2005
+
2010
+
2007
2010
• Incorporation of InTech Solutions,
a joint venture company in Sri
Lanka, to explore IT related
business in South Asia.
• Enhanced its business portfolio
in the Middle East and North
Africa by the acquisition of 50%
equity in Horizon LLC, Abu Dhabi,
United Arab Emirates (UAE).
• Expanded its reach in the region
by acquiring PT HeiTech Intercity
Kerlipan in Indonesia.
2008
• Launched of HeiTech’s Tier-IV
friendly Data Centre by YAB
Dato’ Sri Mohd Najib Tun Hj.
Abdul Razak, Deputy Prime
Minister of Malaysia.
• Sale and Leaseback of Menara
HeiTech Village.
• Strengthen its position as global
IT player by acquisition of 10%
equity in Saeed LLC, Abu Dhabi,
United Arab Emirates (UAE).
• H e i T e c h c o l l a b o r a t e d w i t h
Microsoft Corp. to explore the
possibility of providing state-ofthe-art IT based consumer health
services in Malaysia.
• HeiTech became the first local IT
company to adopt Systems
Applications and Products
(“SAP”) for its internal financial,
logistic and human resources
systems.
2011
• Extended its business in the AsiaOceania region with the
acquisition of Cinix1 Ptd. Ltd. In
Brisbane, Australia.
• HeiTech collaborated with Thales
Nederland, a leading global
technology player in integrated
naval systems to explore the
possibility of developing Combat
Management System for the
Royal Malaysian Navy.
2015
• Enhanced its regional presence
in Thailand, China, Hong Kong,
Singapore and Vietnam by the
acquisition of 20.1% equity in
Grand-Flo Solution Berhad, a
leading brand in Enterprise Data
Collection and Collation System
solutions.
2012
• Extended its global reach to
Myanmar, Brunei and Ghana by
providing system integration
services.
2013
• Disposal of shares in EMAS
Group of Companies and
Grand-Flo Solution Berhad.
• Incorporation of HeiTech Global
Services Sdn. Bhd. to strengthen
our international presence.
• Incorporation of HeiTech Transbiz
Sdn. Bhd. focusing on automotive
solutions for the Automotive
industry.
• Acquisition of DAPAT Vista Sdn.
Bhd.
• Acquisition of Pro-Office Solutions
Sdn. Bhd. (via Inter-City (M) Sdn.
Bhd.).
page
58
HeiTech Padu Berhad
Annual Report 2013
TRADE
MARKS
WARNING NOTICE
NOTICE is hereby given that HEITECH PADU BERHAD GROUP OF COMPANIES (hereinafter referred to as ‘the
Proprietor’) is the registered trademark owner and proprietor of all rights in the trademarks depicted below (‘the
said trademarks’).
The registrations and applications of the said trademarks in Malaysia are as follows:-
Trade Mark
HEITECH
HeiTechVillage
PaduNet
Registered Trade
Mark
(Class)
Trade Mark
Number
9
03000700
16
03000698
35
03000699
37
03000701
38
03000702
39
03000703
41
03000705
42
03000704
9
03000690
16
03000693
35
03000691
37
03000692
38
03000697
39
03000694
41
03000695
42
03000696
16
03000707
35
03000706
16
03002862
37
03002863
38
03002849
42
03002853
9
03002861
41
03002854
Pending Grant
Registration
(Class)
Application
Number
*
*
*
*
*
*
*
*
page
www.heitech.com.my
Trade Mark
Padu*DMS
59
Registered Trade
Mark
(Class)
Trade Mark
Number
9
03002856
16
03002850
42
03002855
Pending Grant
Registration
(Class)
Application
Number
*
*
* Denotes all Trade Marks applied are registered and active
TAKE NOTICE that legal proceedings will be commenced against any party exporting, importing, manufacturing,
selling, offering for sale, advertising or dealing in the said goods or services bearing the said trademarks not
originating from the Proprietor. The Proprietor will not hesitate to make any complaints to the Enforcement Unit
of the Ministry of Domestic Trade & Consumer Affairs for raids to be carried out on infringers. The Proprietor shall
also lodge complaints with the authorities seeking appropriate remedies under the Trade Descriptions Act 1972.
Trade enquiries regarding genuine goods or services with the said trademarks can be referred to HEITECH PADU
BERHAD of Level 15, HeiTech Village, Persiaran Kewajipan, USJ 1, UEP Subang Jaya, P.O. Box 3086, 47509 Selangor
Darul Ehsan or care of:CHEANG & ARIFF
Advocates & Solicitors
Trademark, Patent and Industrial Design Agents
(Solicitors for HeiTech Padu Berhad Group of Companies)
page
HeiTech Padu Berhad
60
Annual Report 2013
SIMPLIFIED SELECTED FIVE (5) YEARS
GROUP REVIEW
2013
RM’000
2012
RM’000
2011
RM’000
2010
RM’000
2009
RM’000
Network Services Fees
84,672
92,662
84,442
92,767
101,876
System Application and Development
65,081
77,822
48,355
51,330
58,675
Sales of Hardware and Software
75,018
63,592
39,595
129,834
52,443
Disaster Recovery and Facility
Management Services
35,330
47,991
45,972
44,302
28,764
–
–
–
182
82
116,120
83,309
90,161
76,427
112,028
30,269
29,152
28,226
23,756
27,393
REVENUE
Imaging and Record Management
Services
Maintenance of Hardware, Software
and Application
Bulk Mailing Charges
Television Content Services
–
–
–
14,781
11,337
7,328
1,001
1,373
531
7,583
413,818
395,529
338,124
433,910
400,181
2013
RM’000
2012
RM’000
2011
RM’000
2010
RM’000
2009
RM’000
7,936
3,357
17,203
17,295
2.0%
1.0%
4.0%
4.3%
Others
PROFITABILITY
(Loss)/Profit Before Tax (RM’000)
(31,438)
(Loss)/Profit Before Tax Margin (%)
-7.6%
(Loss)/Profit After Taxation (RM’000)
(33,349)
4,840
6,060
10,341
10,816
(Loss)/Profit Attributable to Shareholders
(RM’000)
(30,826)
3,742
6,586
8,892
9,969
0.045****
0.04****
0.08***
0.09**
Earnings per Share (RM)
*
Based
** Based
*** Based
****Based
on
on
on
on
the
the
the
the
weighted
weighted
weighted
weighted
-0.32****
average
average
average
average
of
of
of
of
100,011,000
100,428,000
100,716,600
101,225,000
ordinary
ordinary
ordinary
ordinary
shares
shares
shares
shares
of
of
of
of
RM1.00
RM1.00
RM1.00
RM1.00
each
each
each
each
2013
RM’000
2012
RM’000
2011
RM’000
2010
RM’000
2009
RM’000
Total Assets (RM’000)
480,287
528,521
508,791
489,166
463,319
Non-Current Assets (RM’000)
193,084
216,236
219,472
210,827
249,491
Net Current Assets (RM’000)
96,489
95,597
92,334
128,167
47,731
1.51
1.44
1.47
1.85
1.29
ASSETS EMPLOYED
Current Ratio
Debt/Equity Ratio (%)
Shareholders’ Fund (RM’000)
Net Tangible Assets per Share (RM)
Share Capital (RM’000)
+
Based
++ Based
+++ Based
++++Based
on
on
on
on
paid-up
paid-up
paid-up
paid-up
capital
capital
capital
capital
of
of
of
of
RM100,011,000
RM100,428,000
RM100,716,600
RM101,225,000
107.5%
104.2%
109.6%
68.2%
57.6%
175,672
206,547
202,855
202,856
208,588
1.53++++
1.86++++
1.89++++
1.95+++
1.99++
101,225
101,225
101,225
100,716
100,428
page
www.heitech.com.my
61
FIVE (5) YEARS GROUP
PERFORMANCE HIGHLIGHTS
Revenue
Profit Before Taxation
(RM’000)
(RM’000)
500,000
20,000
400,000
400,181
433,910
395,529
413,818
338,124
300,000
17,295
17,203
7,000
3,357
7,936
-6,000
200,000
-19,000
100,000
-32,000
(31,438)
0
-45,000
09
10
11
12
13
09
Profit Attributable to Shareholders
Total Assets
(RM’000)
(RM’000)
15,000
10
12
13
750,000
9,969
8,892
3,000
6,586
3,742
600,000
-9,000
450,000
-21,000
300,000
-33,000
(30,826)
-45,000
463,319
528,521
489,166 508,791
480,287
150,000
0
09
10
11
12
13
09
10
Shareholders’ Fund
Net Tangible Assets
(RM’000)
(RM’000)
250,000
250,000
200,000
11
208,588
206,547
202,856 202,855
200,000
175,672
150,000
150,000
100,000
100,000
50,000
50,000
0
11
12
13
199,906 196,119
191,723 188,711
154,456
0
09
10
11
12
13
09
10
11
12
13
page
62
HeiTech Padu Berhad
Annual Report 2013
REVIEW OF
OPERATIONS
THE BUSINESS OF HEITECH PADU BERHAD IS
THE REALISATION OF A GIVEN POTENTIAL TO ITS
MANY POSSIBILITIES. LEVERAGING ON MORE
THAN A DECADE OF DECENT TRACK RECORD,
EXPERIENCE AND EXTENSIVE KNOWLEDGE OF THE
LOCAL IT INDUSTRY, HEITECH PADU BERHAD
(HEITECH) STANDS AS ONE OF THE NATION’S
MAJOR IT PLAYERS. ASPIRING TO BECOME
MALAYSIA’S TECHNOLOGY BASED
CONGLOMERATE, HEITECH TODAY IS ONE OF
MALAYSIA’S BIGGEST HOMEGROWN IT COMPANY.
At HeiTech, we recognise there’s greater resilience
required to weather the business landscape; shaping
for greater specialisation in key markets segment,
expansion of products and services, building
international business foundation and enabling
business transformation through technology as key
strategies. The business world is a dynamic space:
what works today may not be relevant tomorrow. With
ICT, the pace is accelerated even more. In today’s
market environment, there is no choice but to move
fast and be agile. The business of HeiTech is about the
realisation of a given potential to its many possibilities.
innovative solutions; we do a lot more for our customers
by expanding our knowledge and insights into
customers’ needs, integrating solutions, quality delivery
of services and accelerating new-product
developments. We target to deliver services that will
improve communications and allow our customers to
realise much greater value from our technology for
better growth prospects. When our customers grow,
we hope to grow with them. The business environment
has altered fundamentally; tomorrow’s landscape will
be different, but no less rich in potential for those who
are prepared.
HeiTech offers innovative total solutions in transforming
businesses from manually driven processes to
automated systems and finally towards an effective
and comprehensive information systems which allows
critical business decisions to be made more precise
and timely. We believe our customers’ success
depends on sound technology support and by
synergising energies of our skilled people with
We aim to unleash the potentials of our clients by
offering the best solutions as we measure our success
by the success of our customers. As an attestation of
our credentials, we pride ourselves as one of the key
players in elevating the Public Sector services to what
it is today, by leveraging on our system integration
strength and capabilities.
www.heitech.com.my
page
63
The core business pillars of HeiTech
are the systems integration,
managed data centre services
and managed network. HeiTech
has ventured into other emerging
businesses such as content
development and distribution,
data management and processing
and electronic commerce. This
complimenting business portfolio
allows HeiTech to grow towards
large scale outsourcing business
and hence positioning HeiTech as
a Technology Conglomerate
providing end-to-end solutions.
page
64
HeiTech Padu Berhad
Annual Report 2013
Review of
Operations
PERFORMANCE REVIEW:
FYE 31 DECEMBER 2013
This past year, Malaysia’s ICT
(information and communications
technology) market, operated and
sustained against a backdrop of a
recovering global economy and
the temporary slowdown leading
up to the country’s 13th general
election (GE 13) in May. The latter
part of 2013 also saw a national
Budget and the announcement of
goods and services tax (GST) that
are expected to play a key role in
reducing the country’s fiscal deficit.
This will place a very large
emphasis on the ICT industry to
support the successful adoption of
this ‘developed country taxing
model.’
For 2013, it was expected that the
ICT market spending to pose
single-digit growth. Within the
business world, local organisations
have been receptive and
expe r im ent al in some c a se s,
towards ‘transformational
technologies’ such as cloud
computing, and big data –
developments that are being
fuelled by the on-going enterprise
mobility trend. The technology
industry is highly susceptible to
economic variances because so
much of technology spending
today is discretionary, versus in the
past when enterprise spending
dominated.
2013 was indeed a challenging
year for HeiTech considering that
HeiTech is now at a cross road in
its journey to ensure its sustainability
and survival in today’s challenging
and rapidly changing ICT business
environment.
For the past 3 years, HeiTech was
all about managing sustainability
within a recuperating economy,
saturated market and prudent
spending by the Public Sector.
Among the many change affecting
the ICT industry of Malaysia in
particular are the downsizing of
new contracts and quantity of
development projections but we at
HeiTech are always optimistic
about the track record we have
already built in the markets in
which we operate. All efforts were
focused on realigning the Group’s
operations and securing new
projects for the years to come.
HeiTech have established active
sales pipelines of RM2.49b from its
various sectors with targets to
secure recurring business from
existing customers while gaining
new business from both new and
existing customers.
“HeiTech is
always
optimistic about
the track record
we have
already built in
the markets in
which we
operate.”
page
www.heitech.com.my
Against this backdrop, HeiTech
believes that whilst strengthening
and reinforcing its corecompetency, it must also
strategically diversity its business
portfolio. We are however reminded
by the many illustrations that the
world economy is volatile and the
recovery process is a marathon
race, not a sprint. Even though
HeiTech is one of the premier ICT
partner for the Malaysian public
sector, it does not in any way
hinder it from exploring other
opportunities abroad. HeiTech
believes as a trusted and respected
ICT service provider in Malaysia, it
is high time that it too spread it
wings and compete globally. We
are proud to declare that the year
2013, saw HeiTech traversing
foreign shores in the form of
providing niche expertise to clients
in East Asia, the Middle East and
Africa, leveraging on the
experience as one of the key
players in elevating the Public
Sector services to what it is today.
Globally, there are emerging signs
of improvements in the economy.
Latest economic indicators also
suggest further stabilisation in the
growth performance in Asia.
Notwithstanding
these
improvements, considerable
structural challenges remain in the
advanced economies, which
would constrain the prospect for a
stronger economic recovery.
For 2013, the Group’s financial
performance has been segregated
into continuing operations and
discontinued operations following
its decision to dispose one of its
subsidiaries in the financial year
ended 31 December 2013. The
subsidiary was previously reported
under the television content
services segment in the prior
financial year.
65
Revenue
Profit Before
(RM’000)
(RM’000)
500,000
20,000
400,000
400,181
433,910
395,529
413,818
338,124
300,000
7,000
-6,000
200,000
-19,000
100,000
-32,000
0
-45,000
09
10
11
17,2
12
13
09
Profit Attributable to Shareholders
Total Assets
(RM’000)
(RM’000)
15,000
In 2013, the Group’s
9,969 revenue
8,892 from
6,586
its continuing operations increased
3,000
by
RM18.3 million or 5% to RM413.8
million as compared to RM395.5
million
-9,000in 2012. Major portion of the
increase is due from the
maintenance charges for both
hardware
-21,000 and software and system
application and also the sales of
hardware and software which
-33,000
im
proved by 39% and 18%
respectively in 2013 as compared
t -45,000
o 2012. These sectors have
recorded an increase of RM32.8
m i l l i o n a n d 09
R M 1 1 . 410 m i l l i o11
n
respectively. However, system
application and development
Shareholders’
Fund of RM65
reported
lower revenue
million in 2013 as opposed to
(RM’000)
RM77.8
million in 2012.
750,000
Profit Before Tax (PBT) from
continuing
operations for 2013 fell
3,742
from RM7.9 million to a loss 600,000
before
tax of RM31.4 million. The drop in
profits is due to increase in project
450,000
development costs in one of the
public sector project which was
duly completed in 2013. 300,000
Other
contributors to the Group loss are
due to rising direct and operational
costs. This is worsened by 150,000
sharp
(30,826)
decline in profits from network
m a i n t e n a n c e p r o j e c t s0 a n d
reduction in network services
12
13
revenue.
09
Net Tangible
(RM’000)
250,000
200,000
463,
250,000
208,588
206,547
202,856 202,855
200,000
175,672
150,000
150,000
100,000
100,000
199,
page
66
HeiTech Padu Berhad
Annual Report 2013
Review of
Operations
Historically, our returns has
been driven by the success in
retaining the loyalty of public
sector’s customer while
breaking new ground in new
areas of business. In 2014,
aggressive steps are being
taken and to rise above the
challenges of fierce
competition in the more than
ever saturated market of ICT
industry is the main focus of
HeiTech.
Also to mitigate the raising issues,
the Group is seeking out more
business opportunities for higherend specialised implementations
such as electronic government
products and services in niche
markets in hope to further enhance
the Group’s service deliverables.
The Group will diversify into niche
markets, like that of the Middle
East, as well as expand our
international collaborations and
involvement to generate profits for
the years to come. Driven by
strategic business expansion
decisions, HeiTech actively
collaborates with both the
commercial sector and government
agencies within various countries
leveraging on its International
Strategic Business Group (ISBG)
represented by its partners and
international investment companies
such as PT HeiTech Intercity
Kerlipan in Indonesia, Epic Lanka
Pvt Ltd and InTech Solutions Pvt.
Ltd. in Sri Lanka, Cinix 1 Pty. Ltd. in
Australia, SAAED For Traffic System
LLC in Abu Dhabi and HeiTech
International LLC in Dubai, United
Arab Emirates. HeiTech has
stepped up efforts towards further
improvising a cost-efficient
operation structure and working
capital management programs.
page
www.heitech.com.my
67
SECTORIAL BUSINESS
The public sector in fiscal 2013 remains the larger
contributor of revenue marking at 63% of total revenues
while private sector contribution is 37%. Major
contributor for the 2013’s public sector percentage
was the revenue from the JPJ MySikap project, revenue
from maintenance of hardware and software for JPN
and from maintenance of Sukhoi Simulator.
Efforts has been doubled to increase contribution from
the private sector and to reduce dependency on the
public sector. The BSN Core Banking project contributed
further towards private sector revenue contribution to
the Group revenue. 76% of our network services is
from the private sector contribution. This is good
progress towards reaching out to the private sector
market as the network services is the Group’s second
major contributor to the Group revenue stream in
2013.
We remain optimistic for 2014. This optimism is backed
by the interest shown by growing enterprise and the
public sector in cloud computing and ICT-friendly
budget measures. The Malaysian Government has
been pursuing a long-term plan with the ambition to
achieve high-income status by the end of the decade,
with ICT playing a critical role. This underscores the
Government's prioritisation of ICT, the importance of
ICT to the Government’s vision of the future, and the
initiatives by the Government to provide online services.
These government-led efforts are a significant factor in
ICT's transformational impact on the economy and on
society at large.
Furthermore, with the growing number of SMEs needing
greater access to information and technology, more
cost effective Cloud computing software, is seen as
having great potentials to help more SMEs to bridge
the great digital divide. HeiTech intend to leverage on
its expertise and innovative solutions in cloud
computing, big data, mobility and social media, to
propel the Group further to greater heights.
Although an equitable diversification of business
between the public and private sector are preferred,
taking into consideration the cyclical factors in
demands and increasing competition, it will not be an
easy feat. Looking at the development of automation
in the Malaysian public sector operations, the public
sector will still be the major driver of earnings growth
for HeiTech as long as the Government continues to
improve its delivery system via ICT. Continuous efforts
are doubled to ensure HeiTech Padu Berhad is still a
household name in the ICT scene of public sector.
To broaden the earnings base HeiTech actively
collaborates with both the commercial sector and
government agencies within various countries to
further explore markets outside Malaysia, leveraging
on HeiTech’s experience on the electronic government
transformation projects with the Malaysian public
sector.
Sectorial Revenue Contribution -Publics Private Sector Contribution
30%
21%
2009
2010
70%
Public
34%
2011
79%
Private
38%
37%
2012
66%
2013
62%
63%
page
HeiTech Padu Berhad
68
Annual Report 2013
Review of
Operations
QUALITY OF REVENUE
The quality of revenue is quantified by its recurring or
otherwise nature over a period of more than one year.
In essence, it is an indicator for the sustainability of
the Group to generate a stable return to the
shareholders. An example of recurring revenue would
be maintenance services for existing customers that
previously employ our system integration services. Nonrecurring revenue such as System Integration services,
which is generally acknowledged as the major
contributor in terms of earnings are a few and hard to
come by over the years. This is due to stiff competition,
cyclical demand and with more off-the-shelf solutions
available in the market.
In 2013, proportions of recurring and non-recurring
revenue remain the same as 2012. HeiTech has
registered recurring revenue of 63% out of total revenue
in respect of 2013. However, in term of quantum, the
value of recurring revenue has improved by 5% as
compared to 2012. In 2013, there is an increase by 4%
of non-recurring revenue, mainly contributed by
increase in sale of hardware and software and systems
application and development revenue. This nonrecurring revenue would usually be the entry-point for
possible opportunities of new non-recurring revenues
and may translate into future recurring revenues on
the maintenance of the systems delivered.
Having a good balance between recurring and nonrecurring projects supports continuous growth of the
Group where the non-recurring revenues may lead to
potential recurring revenues in the years to come.
CONTRIBUTION OF BUSINESS ACTIVITIES
Revenue Contribution by Business Activities
(RM’000)
System Integration
2013
2011
Recurring vs Non-Recurring Revenue
Contribution
(RM’000)
Recurring
450
400
196
130
142
300
250
270
266
237
200
249
253
150
50
2009
2010
32%
2011
2012
2013
45%
2009
25%
2010
68%
Recurring Revenue
36%
36%
2011
55%
46
223
131
By breaking the revenue based on the above, it can
be concluded that the main driver of the Group is
from Systems Integration followed by Managed Services
and Other Services. System Integration remains the
main contributor yielding RM256 million in 2013 being
100
0
258
To analyse the business activities contribution more
simplistically, the core revenue are consolidated into
System Integration, Managed Services and others. By
this definition, activities are associated through
consequential relationship with one another. For
example, System Maintenance Services post
completion of System Integration and Application
Development (SIAD) are included under System
Integration.
147
89
350
178
137
39
2009
Non-Recurring
130
30
2010
225
141
30
Others
256
120
38
2012
Managed Services
2012
74%
Non-Recurring Revenue
2013
64%
64%
page
www.heitech.com.my
69
62% of Group contribution. Looking back through the
years, System Integration despite stiff competition,
cyclical demand and the availability of more off-theshelf solution available in the market, it has proven a
record of steady revenue contribution. In 2013,
HeiTech’s System Integration revenue improved by 14%
consistent with the increase in total revenue.
In 2013, System Integration Services overall revenue
improved by 14% despite the drop by 16% from its
System Integration revenue contribution. This reduction
is due to the completion of the development phase
for the MySikap, Jabatan Pengangkutan Jalan (JPJ)
Revamp project in 2013. Maintenance services revenue
increased by 39% from RM83 million in 2012 to RM116
million in 2013.
SYSTEM INTEGRATION SERVICES
Trading on the other hand, is the most volatile revenue
stream due to differences in requirements from one
System Integration project to another. In 2013, sales of
hardware and software increased by 18% mainly
contributed from the increase in trading income
mainly due to delivery of hardware and software to
BSN Core Banking project and passport re-order from
the Government of Sri Lanka.
System Integration Revenue Analysis
(RM million)
Trading
75
2013
2011
2010
2009
116
65
64
2012
System Application
& Development
Maintenance
83
78
40
MANAGED SERVICES
90
48
Managed Services Revenue Analysis (RM million)
130
76
51
52
59
112
Imaging
35
2013
The System Integration business consists of the system
application and development (SIAD), trading of
hardware and software (“Trading”) and maintenance
services. Generally, System Integration would entail an
upgrade of hardware and software to support the
new system. This is packaged together to ensure
smooth delivery of the system. Maintenance services
are provided post development and implementation
to maintain the system at its optimum level of
performance. Based on the trend within the last five
years, Maintenance Services is one of the major
contributors to this business.
46
2011
2010
2009
0.2
0.1
44
29
Network Services
85
48
2012
HeiTech was built on System Integration. Our notable
success came from the 3J projects where the Group
made its mark as one of the premier System Integrator
in Malaysia. Arguably, the Group had played a part
in opening the door for other home grown System
Integrator by establishing market confidence in the
local player with our track record. On the other hand,
the Group has also created more competitors in the
domestic market over the years due to the same
reason.
Disaster Recovery
59
93
84
93
102
Managed Services is the Group’s main staple for fixed
and recurring revenue. Intrinsically, this business
provides a defensive earning to the Group against the
more high profile and volatile contribution from System
Integration business. Managed Services in 2013
represents 29% of the Groups revenue contribution.
Managed Services in 2013 consists Network Services
and Disaster Recovery. The main contributor from this
revenue stream is Network Services which contributed
RM84.6 million in 2013. A reduction of 9% from 2012 is
mainly due to non-renewal of some of the contracts
which expired during the year.
CORPORATE
RESPONSIBILITY
HeiTech is committed to the principles
of responsible corporate citizenship. We
believe that Corporate Responsibility
(CR) is an integral part of its business
culture.
As a responsible corporate entity, we are always looking at ways in which
we can contribute meaningfully to our key CR thrust on education and
community development. Besides the aforementioned, our CR program
aims to contribute to capacity building, human capital development and
intellectual enhancement.
Whilst striving for business excellence, HeiTech continuously inculcates
good CR practices in all its endeavours. By consistently applying CR in our
business processes, it will not only contribute towards economic prosperity,
but also to the growth of the community.
As CR is a continuous process, we pledge to renew and strengthen our
commitment to be a responsible and accountable organisation. Our
holistic CR approach focuses on four main areas; the community,
workplace, environment and marketplace.
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72
HeiTech Padu Berhad
Annual Report 2013
CORPORATE
RESPONSIBILITY
OUR COMMITMENT TO THE COMMUNITY
At HeiTech, we are committed in supporting the
creation of communities which are prosperous,
sustainable, educated and healthy. We believe this
can be achieved by conducting our business in an
ethical way and in the interest of said communities.
1. Youth and Educational Development
• HeiTech’s involvement in youth educational
development began since 2008, when we
adopted Sekolah Kebangsaan Kertau (SK
Kertau) in Maran, Pahang, as part of the
‘Empowerment of Youth Generation Program’.
With this initiative, we played our role in
improving the educational standards of rural
students, by providing them with opportunities
to excel in their education. The program
continued and in 2010, twelve (12) more
schools were funded under the ‘UPSR Excellence
Program’. We invested these schools with
educational seminars, tutorial classes, and
sports program. We believe through these
initiatives, we had made a big impact in the
lives of students in the community.
• Y e t a n o t h e r f a c e t o f o u r E d u c a t i o n a l
Development initiative was the opening of our
doors to make industrial visits possible. Students
from selected colleges and universities were
given the opportunity to make industrial visit to
our world-class IT infrastructures and facilities.
Participants were briefed on several
breakthrough achievements and solutions,
ranging from Software Development, ICT
Architecture & Infrastructure Solution, Network
Solutions and Desktop Management. It is our
hope that these visits will ignite the interest and
fuel the passion of the next generation of IT
specialist.
• HeiTech’s Scholarship Program was established
in 2008 and since its establishment, the number
of selected students progressively increase
from one (1) to eight (8) students in 2013. As
the adopted students of HeiTech, there were
given the opportunity to benefit from HeiTech’s
education allowances, books and other things
that relate to their educational purpose.
HeiTech have consistently monitors their
academic performance in achieving our long
term vision to nurture the adopted students to
be future leaders equipped with necessary
knowledge and skills.
• We also have conducted HeiTech’s Internship
Program which aimed to immerse students
from both local and overseas universities into
the dynamic work environment, providing them
real life experience of what they will face in the
real working world by exposing them to the
various facets of the organisation in a program
which lasted between six (6) to thirty (30)
weeks. This program is designed to match the
students’ interest and abilities, and at the
same time to impart pertinent knowledge and
direct tangible skills that will help them decide
which facet of the ICT industry best fits their
career aspirations.
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73
2. Social Development and Philanthropy
• Since early 2000, HeiTech has been a
strong advocate of saving lives through
voluntary blood donation initiatives.
Annually, we hold an open day where our
employees, tenants and residents around
Subang Jaya area can donate blood. This
annual initiative, exemplifies the need for
all Malaysian to fulfil their social obligation
and to also support the National Blood
Bank.
• Philanthropy remains an important aspect
in our CR effort. Ideally, all requests are
evaluated and scrutinised to meet stringent
criteria. We are serious in our efforts to
build goodwill for the company through
offering our value proportion across all
segments of society, embracing our
corporate value and in-line with the
Government and regulatory policies. Our
beneficiaries range from schools,
universities, NGOs, orphanages, and
others.
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74
HeiTech Padu Berhad
Annual Report 2013
CORPORATE
RESPONSIBILITY
OUR COMMITMENT TO THE WORKPLACE
We firmly believe that people are the cornerstone of
our organisation’s success. In support of our main
asset, we have invested in creating a conducive
working environment for all our employees. We pride
ourselves in providing them with avenues to enhance
their personal and professional development. We
ensure that competencies of each individual are
mapped according to their aptitude. At the same
time, we take the necessary measures to retain high
calibre individuals who contribute to the growth and
bottom line of the organisation. This is in line with our
corporate goal to provide rewards based on
performance.
first aid. In addition, we have also organised
health awareness programs such as medical
check-ups and talks to foster health conscious
workforce.
3. Work-Life Balance
In an ideal situation, employees seek out jobs that
provide an element of flexibility, creativity, and
growth. Work life balance is a crucial consideration
for HeiTech, as we believe happy employees
result in optimum productivity, improved morale
and reduction in turnover and absenteeism. In
showing our concern in giving morale support, we
have embarked on initiative to invite financial
institutions and organisation to promote and
market their products to our employees such as
Maybank, BSN, CIMB, Citibank, Celcom and
others.
Another recent initiative in promoting work-life
balance is through the launching of HeiTech
Cares Program where we become a corporate
member to hotels like Tune Hotels, Awana Kijal,
Cherating, TH Travels & Tours and few other hotels
around the world, so each staff can enjoy a
special rate when they are away for holiday with
their family and loved ones under the program.
1. Human Capital Development
We welcome people with diversified skills,
experiences, and approaches that we can infuse
into our business, to promulgate a creative
environment. Each employee’s potential is primed
to develop their competitive prowess and
measured through a structured measurement of
Key Result Area (KRA) and Key Performance
Indicator (KPI).
Employees are empowered by their participation
in training courses that equip them for leadership
roles and sharpening of business acumen. As an
ICT company, we take pride in ensuring that our
skilled people are technically competent in
meeting the ICT industry standards. We also take
great effort to ensure that our technical and
operation engineers are equipped with up-to-date
knowledge and expertise by encouraging them to
pursue proper certification to complement their
skills.
2. Conducive and Safe Working Environment
We place paramount importance on our
employees’ wellbeing; hence we always aim at
maintaining a conducive and safe working
environment. The formulation and enforcement of
HeiTech’s established Occupational Health and
Safety (OHS) Policy ensure all employees are
aware of their roles and responsibilities in their
work environment. Our OHS Policy complies with
the Occupational Safety and Health Act 1994
(OSHA 1994) and the Occupational Safety and
Health (Safety and Health Committee – SHC)
Regulations 1996.
To ensure full compliance, we provide training
and awareness programs on occupational health
and safety matters related to manual handling,
hazard identification, fire drills, fire fighting, and
4. Communication with Employees
Employees’ engagement has always been our
top priority, as we believe that engaging
employees at every level of the business results in
higher performance, an essential element to
achieving our business objectives.
Various communication channels such as
Corporate/Business Updates, Employees Surveys,
the Appraisal and Career Development Plan,
Award/Recognition programs and the
implementation of two-way communication tools
were used to communicate the company goals.
The programs organised by HeiTech to enhance
communications with employees include:• Corporate Kick-Off
• Internal Satisfaction Survey
• Retention Programs – Chairman’s Award and
Long Service Award
• Dual Communication Platform
• Business Update Session
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75
THE CHAIRMAN’S AWARD 2013
We honour those who have gone above and beyond
their duty towards the success of HeiTech. The
Chairman’s Award is conferred to individuals or teams
that displayed exceptional performance in achieving
the company’s objectives.
The Chairman’s Award has been divided into four (4)
categories:• Chairman’s Product Innovation Award
✓ Winner
–
P intarID (HeiTech e*Business
Solutions Sdn. Bhd.)
✓ First Runner-up–
JIAS Integration Services
(HeiTech e*Business Solutions
Sdn. Bhd.)
✓ Merit
–
V ehicle Information System
Integration (HeiTech TransBiz
Sdn. Bhd.)
• Chairman’s Service Excellence Award
✓ Winner –
Data Centre Service Team on
MySIKAP Revamp System
(HeiTech Managed Services
Sdn. Bhd.)
✓ Merit
–
G IANT WAN Project (HeiTech
Managed Services Sdn. Bhd.)
THE LONG SERVICE AWARD 2013
We are always humbled by those who have stayed
loyal and persevered through the years. In appreciation
of those who have dedicated themselves to HeiTech’s
success, we have initiated the Long Service Program
since 2002. This year, one (1) employee has received
his thirty (30) years of service recognition while four (4)
more received the recognition for twenty (20) years of
service and forty four (44) received for ten (10) years.
The Long Service Award recipient for 30 years of
service is as follows:• WAN ZAIDI BIN WAN JAAFAR
The Long Service Award recipients for twenty (20)
years of service are as follows:• ZULKEPLI BIN JAAFAR
• ARNA BIN MOHD YAMAN
• NOR HASIMAH BINTI ISMAIL
• ZAINAL BIN HJ. JASIMAN
The Long Service Award recipients for ten (10) years of
service are as follows:SUHAIZAR BINTI OSMAN
NORITA BINTI MOHD YUNOS
MOHD SANUAL BIN KAHARUN
HADRUL AKMAR BIN AHMAD
NOR HUDA BINTI IBRAHIM
FADHLIL NIZAM BIN AB GANI
MOHD AZIZI BIN MOHAMED MISMAN
ZURAINI BINTI ANNUAR
SHARIFAH ALINA BINTI SYED ALWI
MOHD KHAIRUSSALLEH BIN MOHAMAD KASINI
SALAMAT BIN ADISNABI
KHAIRUL AZIRA BINTI KHAIRUDDIN
AIDA BINTI ABDUL RASHID
FAIZUL BIN MOHAMAD
AMIR HANIFF BIN HALIM
FARYNA BINTI AHMAD MANSUR
MOHD SUHAIMI BIN SALLEH
MEGAT SHAMSUL AMAIZ BIN MEGAT AZAM
SABRI BIN SENIN
MOHAMED KAMIL BIN ABDULLAH
LENNY RUBY ANAK ATAI
MUHAMMAD JASMIL BIN DASAH
SITI MAZLIN BINTI MASROM
RUZIATI BINTI ISMAIL
IRINA BINTI RAMLI
ZULKARNAIN BIN KAMALUDIN
EDZUINA BINTI MOHD SHARIF
LIM THIAM HUAT
ZULKARNAIN BIN SAARI
MOHD AZUAN BIN TAHIR
MOHD AKBAR BIN ROSNEE
NOOR AZMI BIN MOHD SANI
DZULHANAN BIN ZAINAL ABIDIN
NORZALIMI BIN ABU BAKAR
HASWANDI BIN ASRUL
ROZAIDAH BINTI MAION
SITI FARAH HUDANI BINTI AB. HADI
MOHD HAFIZUL BIN IBRAHIM
MUSA BIN ABDULLAH
MOHD FAIRUZ FAIZAL BIN ZAINAL
KHADIJAH BINTI ABDUL RAHMAN
NORAIZAM BIN BADRON
ZOHAN ZUKI BIN MOHD ZUKI
HO KENG HONG
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76
HeiTech Padu Berhad
CORPORATE
RESPONSIBILITY
OUR COMMITMENT TO THE ENVIRONMENT
We are committed towards the conservation of the
environment, with special focus on environmental
management.
For this initiative, we focused on improving the quality
of life for all Malaysians by meeting their growing ICT
demands while reducing the impact on the
environment these communities live in. Some of the
initiatives to support this include:• Ultra Energy saving devices at data centres resulting
in more efficient energy usage.
• HeiTech observed Earth Hour on Saturday, 29 March
2014; an initiative to promote environmentally
sustainable action, through non-utilisation of all
non-essential lights for a full one hour in our HQ,
Menara HeiTech Village.
Annual Report 2013
page
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77
OUR COMMITMENT TO THE MARKETPLACE
We are in the business of delivering innovative solutions
to our customers and the public. In 2013, we continued
to demonstrate our commitment in realising this
through various initiatives such as active engagement
with stakeholders, taking the role of key opinion leader
in the ICT industry and delivering excellent services.
1. Active Engagement with Stakeholders
We believe in synergising our capabilities and
experience with our industry leading partners’
technologies. Complementing this synergistic
relationship is our deep understanding of our
customers’ requirements and the industry. Thus
mix, we believe, resulted in excellent delivery to
our customers. As such in 2013, we have actively
engaged our stakeholders that included
customers, partners, suppliers and Government
regulators.
Event details as below:-
Event
: LUNCH and LEARN
Date
: 5 March 2013
Partner
:Symantec
Attendees : Internal (Account & Sales team)
Event
:
HeiTech Executive & Technology
Update – 2013 Business Outlook
Date
: 18 April 2013
Partner
:IBM
Attendees : Customer (Public Sector)
Event
: HeiTech VIP Golf Tournament
Date
: 19 May 2013
Partner
: VIP Towers
Attendees : Customer (Public Sector)
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78
HeiTech Padu Berhad
Annual Report 2013
AUDIT COMMITTEE
REPORT
The Board of Directors of HeiTech Padu Berhad is pleased to present the Report of the Audit
Committee (“Committee”) for the financial year ended 31 December 2013.
COMPOSITION OF MEMBERS
The Committee comprises of Non-Executive Directors of the Company, the majority of whom
are Independent. The composition of the Committee includes members of the Malaysian
Institute of Accountants (MIA) as prescribed in the Accountants Act 1967.
The Committee comprises of the following members:
Name of Committee Members
Status of Directorship
Tan Sri Dato’ Mohd. Zuki bin Kamaluddin
(Deceased on 17.03.2013)
Dato’ Ab. Halim bin Mohyiddin
(Resigned w.e.f. 27.05.2013)
Tuan Haji Ghazali bin Awang
Chairman of the Committee
Tuan Syed Agel bin Syed Salim
Puan Wan Ainol Zilan binti Abdul Rahim
(Appointed on 06.08.2013)
TERMS OF REFERENCE OF THE COMMITTEE
2. Functions and Responsibilities
1.Objectives
The Primary function of the Committee is
to assist the Board of Directors in fulfilling
the following objectives:
a. F i n a n c i a l t r a n s p a r e n c y a n d
operational efficiency of the Group;
The functions and responsibilities of the
Committee are:
a. Financial Reporting
Review of the Group’s quarterly and
year-end financial statements prior
to deliberation and approval by the
Board, focusing on:
b. I n t e g r i t y o f t h e f i n a n c i a l a n d
operational reporting processes and
procedures of the Group; and
• The nature and impact of any
changes in accounting policies
and practices;
c. Compliance with:
• Significant adjustments;
• Listing Requirement of the Bursa
Malaysia Securities Berhad
(BMSB);
• Securities Commission Policies
and Guidelines on Issue/Offer of
Securities; and
• A c c o u n t a b i l i t y a n d a u d i t
requirements of the Malaysian
Code on Corporate Governance.
• The going concern assumptions;
and
• C o m p l i a n c e w i t h F i n a n c i a l
Reporting Standards, the Listing
Requirements of BMSB and other
legal requirements.
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79
b. Internal Audit
• Review the Internal Audit program and
results of the Internal Audit activities, and
ensure appropriate actions are taken on
the recommendations of the Internal
Auditor;
• Review the adequacy of the Internal Audit
function, plan, scope, competency and
resources, and that it has necessary
authority to carry out its work;
• Review the performance of the Internal
Audit function;
• Approve the appointment and termination
of Head of the Internal Audit; and
• Provide opportunity for internal audit staff
members who have resigned to submit
their reason.
From left to right:
*Not in the picture –
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HeiTech Padu Berhad
80
Annual Report 2013
Audit Committee
Report
c. External Audit
• Discuss the nature and scope of the audit
with the External Auditor prior to the
commencement of audit;
• Discuss issues and observations arising
from the interim and final audits, and any
matters the auditors may wish to discuss
without the attendance of management,
whenever deemed necessary;
• Review the External Auditor’s Management
Letter and management response; and
4. Reporting of Breaches to the Listing Requirement
5. Conduct and Attendance of Meeting
Meetings are conducted at a minimum, four (4)
times annually and also as and when required
during the financial year. The quorum for a
meeting requires at least two (2) Independent
Non-Executive Directors to be present.
The Company Secretaries serve as the Secretary
to the Committee and provide the necessary
administrative and advisory services for the
effective functioning of the Committee. Prior to
each meeting, the Secretaries will ensure the
agenda, minutes of meeting, audit reports,
financial reports and supporting papers are
distributed to members with sufficient notification.
The Head of Internal Audit and Chief Financial
Officer shall attend the meetings. Other Board
members, Senior Management and employees
may attend the meetings upon invitation of the
committee.
• R e c o m m e n d t h e n o m i n a t i o n o r r e appointment of the External Auditors, the
audit fee and termination.
d. Related Party Transaction
Review related party transactions that may
arise within the Company or the Group on a
quarterly basis.
e. Other Matters
Consider other function as defined by the
Board of Directors.
3. Rights and Authorities
The Board of Directors has empowered the
Committee, at the cost of the company, to:
a. Investigate any matters within its terms of
reference;
b. Obtain the resources which are required to
discharge its duties;
c. Secure full and unrestricted access to any
information pertaining to the Company;
d. Direct communication channels with the
External Auditors, Internal Auditors and Senior
Management of the company and its
subsidiaries;
e. Obtain independent professional or other
advice; and
f.
Convene meetings with the External Auditors,
the Internal Auditors, or both, excluding the
attendance of other directors and employees
of the company, whenever deemed
necessary.
The Committee shall promptly report to the BMSB,
if the Committee is of the view that matters
reported to the Board of Directors of the Company
have not been satisfactorily resolved, resulting to
a breach of Listing Requirement.
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81
During the financial year ended 31 December 2013, the Committee met (8) times. The attendances of the
Committee members are as follows:
Members
Status
Tan Sri Dato’ Mohd. Zuki bin Kamaluddin
(Deceased on 17.03.2013)
–
Dato’ Ab. Halim bin Mohyiddin
(Resigned w.e.f. 27.05.2013)
5/5
Chairman of the Committee
8/8
8/8
(Appointed on 06.08.2013)
3/3
SUMMARY OF ACTIVITIES
Attendance
b. External Audit
During the financial year ended 31 December 2013,
the Committee carried its duties as set out in its terms
of reference, as follows:
i.
Review and discuss with the External Auditor’s
audit plan, nature, approach and scope of
the audit; and
a. Internal Audit
ii.
Review and discuss issues arising from External
Auditors’ Management Letter to the
Management, Management response and
External Auditors’ evaluation of the Internal
Control System.
i.
Review and approve the Annual Internal
Audit Plan;
ii.
Review the Internal Audit Reports on significant
issues and audit findings, recommendations
and management responses;
c. Financial Reporting
iii. Discuss on action taken to improve the
effectiveness of the Internal Control System in
the audit areas;
i.
iv. M o n i t o r t h e i m p l e m e n t a t i o n o f a u d i t
recommendations to ensure that all key risks
and controls issues are being addressed;
ii. Review the annual financial statements and
ensure compliance to the accounting
standards and other requirements of relevant
authorities.
v.
Review the Audit Committee Report, Statement
on Risk Management and Internal Control
and Statement of Corporate Governance for
each financial year to be set out in the
Annual Report; and
vi. Review Internal Audit performance reports for
each financial year to ensure adequacy,
performance, progress, achievement and
coverage of the Internal Audit function.
Review quarterly financial statements prior to
recommending for consideration and
approval by Board of Directors; and
d. Related Party Transactions
i.
Review related party transactions within the
Company and Group, including any
transactions, procedure or course of conduct
that may raise questions of integrity.
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82
HeiTech Padu Berhad
Annual Report 2013
Audit Committee
Report
STATE OF INTERNAL CONTROL
The Statement on Risk Management and Internal
Control furnished on pages 91 to 95 of the Annual
Report provides the overview of the state of internal
controls within the Group.
RELATIONSHIP WITH THE EXTERNAL AUDITOR
The Group through the Committee has established
transparent and appropriate relationship with the
External Auditors, to meet their professional
requirements. Key features underlying the relationship
of the Committee with the External Auditors are
included in the Audit Committee’s Terms of Reference.
Meetings are held during and after the year end to
discuss the findings of the External Auditors and to
finalise the results of the Financial Statements.
INTERNAL AUDIT FUNCTION
For the financial year ended 31 December 2013, the
main activities of the Internal Audit include the
following:
a. Prepare Annual Internal Audit Performance Report
and Annual Internal Audit Plan for the approval of
the Committee;
b. Implement the approved Annual Internal Audit
Plan;
c. Assess the adequacy and effectiveness of internal
control systems within the Company and the
Group;
d. Examine and evaluate the adequacy, effectiveness
and efficiency of all financial and operational
control within the Company and the Group;
e. A s c e r t a i n t h e a d e q u a c y o f c o n t r o l s f o r
safeguarding the assets of the Company and
where applicable, verify the existence of the
assets owned by the Company and the Group;
The Internal Audit function of HeiTech is carried out by
the Audit & Assurance Division which directly reports
to the Committee. It provides the Board of Directors
with assurance it requires regarding the adequacy,
integrity and effectiveness of the system of internal
control.
f.
Internal auditing is carried out on a Group basis to
ensure consistency in the application of policies and
procedures within the Company and the Group.
Internal Audit independently reviews the control
processes (financial and operational controls)
implemented by the management.
h. Conduct ad-hoc audits upon request by the
Committee and Management of the Company;
A detailed Annual Internal Audit Plan is presented to
the Committee for approval. The Internal Audit function
adopts risks-based approach following COSO
(Committee of Sponsoring Organisation of The
Treadway Commission) as the Control Framework for
business activity, and CoBIT (Control Objectives for
Information and Related Technology) for IT related
audit and prepares its audit strategy and plan based
on the risk profiles of the major business units and
support functions of the Group.
Provide reporting and recommendations to the
Management of the Company and/or the
Committee and the Board of Directors on the
outcome of the audits;
g. Conduct follow up audit to ensure effective and
timely resolution of audit issues;
i.
Organise internal audit training programs for
Internal Auditors to enhance their audit skills and
knowledge; and
j.
Keep the Committee informed of the progress of
audit activities.
This Audit Committee Report is made in accordance
with the resolution of the Board of Directors dated
17 April 2014.
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83
STATEMENT OF
CORPORATE GOVERNANCE
INTRODUCTION
The Board is pleased to present the application of the Principles and Best Practices of
Corporate Governance for the financial year ended 31 December 2013, as set out under
Part I and II of the Malaysian Code of Corporate Governance (“MCCG 2012”) and
Paragraph 15.25 of Bursa Malaysia Securities Berhad Listing Requirements.
THE BOARD OF DIRECTORS
Roles and Responsibilities of the Board
The Board
The Board is bestowed with duties and
responsibilities to ensure the interest of
shareholders are protected. The Board’s roles
and responsibilities are clearly set out in the
Board Charter which spells out as follows:
The Board of Directors (“Board”) is composed
of individuals with the appropriate skills and
expertise required in order to ensure the
sustainability of the business.
The selection of individuals with the required
mix of skills and experiences is paramount in
order for the Board to be able to provide a
clear and effective leadership whilst
promoting and embedding good governance
practices and culture. The Board selects,
after recommendation from the Nomination
Committee and in conformity with the Code,
individuals from business, legal, financial,
taxation, accounting, insurance and
information technology to guide the
Company in achieving its business objectives.
At present, the Board consists of eight (8)
members, five (5) independent and three (3)
Non-Independent Non-Executive Directors.
Chairman and Chief Executive Officer
There is a clear division of responsibility
between the Chairman and the CEO thus
ensuring a balance of power and authority.
The Chairman’s role is to provide leadership
and ensure the effectiveness of the Board’s
Governance processes, whilst the CEO
manages the commercial and operational
aspects of the business.
• Reviewing and adopting a strategic plan
for the Group;
• Overseeing the performance of the
management;
• Monitoring and managing principal risks
in the business;
• Ensuring implementation of appropriate
internal controls and mitigation measures;
• S u c c e s s i o n p l a n n i n g
management;
for
senior
• O v e r s e e i n g t h e d e v e l o p m e n t a n d
implementation of a stakeholder
communication policy for the Group; and
• Reviewing the adequacy and the integrity
of the management information and
internal control system of the Group.
Code of Conduct
The Directors are expected to adhere to the
Code of Business Conduct and Ethics which
was designed to promote the principles of
integrity, sincerity, honesty, responsibility,
social responsibility and accountability in
order to enhance the Group’s standard of
corporate governance and behaviour. The
Directors are obliged to follow the code as it
is a way to manifest their commitment to
professionalism and integrity.
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HeiTech Padu Berhad
Annual Report 2013
Statement of
Corporate Governance
Whistleblowing Policy
Sustainability
A whistleblowing policy has been adopted in order to
ensure that concerns or wrongdoings in relation to the
Group may be raised. The Audit Committee has been
tasked to facilitate the investigation and proposed the
appropriate action to be taken.
Sustainability is paramount to the Group. Sustainability
creates business value by building reputation,
enhancing the morale of the employee and
strengthening competitiveness. The Group adopts and
implements sustainable practices which identify new
initiatives and potential areas for improvement. Such
practices would facilitate the minimisation of negative
impacts on the business activities and be consistent
with the business objective.
Board of Directors Meeting
The Board meets on a regular and scheduled basis, at least four (4) times a year, once every quarter, to review
corporate strategies, operations and the performance of the Strategic Business Group as well as the Operating
Companies within the Group. Additional meetings are held as and when required or the urgency of the matter
warrants such an action to be taken. During the financial year under review, the Board met six (6) times and
the details of the attendance of the Board members are set out as follows:70th
71st
72nd
73rd
SP1
SP2
28
Feb
23
May
28
Aug
28
Nov
17
Apr
17
Dec Attendance
No Name of Directors
Designation
1
Dato’ Mohd Hilmey bin
Mohd Taib
Chairman
/
/
/
/
/
/
6/6
2
Tuan Haji Ghazali bin
Awang
Independent
Non-Executive Director
/
/
/
/
/
/
6/6
3
Dato’ Mohd Fadzli bin
Yusof
Independent
/
/
/
/
/
/
6/6
4
Tan Sri Dato’ Sri Abi Musa
Asa’ari bin Mohamed Nor
Independent
/
/
/
/
/
x
5/6
5
Tuan Syed Agel bin
Syed Salim
Non-Independent
/
/
/
/
/
/
6/6
6
Dato’ Dr. Mohamed Ariffin
bin Aton
Non-Independent
/
/
/
/
/
/
6/6
7
Sulaiman Hew bin Abdullah Independent
Appointed w.e.f. 30.07.2013 Non-Executive Director
x
x
/
/
x
/
3/3
8
Wan Ainol Zilan binti
Independent
Abdul Rahim
Appointed w.e.f. 06.06.2013
x
x
/
/
x
/
3/3
9
Tuan Haji Safiee bin
Haji Mohammad
Resigned w.e.f. 02.09.2013
Executive Director
/
/
x
x
/
x
3/3
10
Dato’ Ab. Halim bin
Mohyiddin
Independent
/
/
x
x
/
x
3/3
11
Ou Shian Waei
Independent
/
/
x
x
/
x
3/3
page
www.heitech.com.my
85
Conduct of Meetings (Board Agenda)
Board Charter
The Chairman of the Board and chairpersons of the
Board’s committees outline the agendas for the Board
and committee meetings. The Chairman and
chairpersons of the respective committees review the
Board and committees’ agenda respectively. In
relation to the Board, each director is free to suggest
items for the agenda, and each director is free to
raise issues and concerns at any Board Meeting.
The Board’s roles and responsibilities, as stated earlier
are set forth in the Terms of Reference (“TOR” or
“Charter”) For the year under review, these documents
remain as the main reference in establishing clear
functions, roles and responsibilities of the Board and
the management of the Company.
Access to Information and Advices
The Board has full and unrestricted access to all
information of the Group’s business and affairs to
enable them to discharge their duties effectively.
Management shall furnish the Board with all material
information for the Board to be kept updated on the
Group’s activities and its operations on a regular
basis. Regular and latest updates on regulations and
guidelines issued by relevant authorities on corporate
matters are provided to the Board. The Board also has
access to all reports on the Group’s activities, both
financial and operational in which officers and
employees of the Group may brief and present details
to the Board, upon request.
The Board has also approved a procedure for Directors,
whether as a full Board or in their individual capacities,
to take independent advice, where necessary, at the
Group’s expense in furtherance of their duties.
Group Company Secretary
The duties of a Company Secretary are both extremely
broad in scope and onerous. The Company Secretary
provides the Board with the guidance on the discharge
of their responsibilities. The Company Secretary also
acts as the primary point of contact and source of
advice to all directors.
Ahmad Noor bin Sulong, is the Company Secretary of
the Group. He is responsible to effectively manage the
meetings of the Board and its committees. Besides
being the Board’s compliance advisor, he is also
responsible to escalate all of the Board’s resolution to
the Management for its further action.
The Charter contains key values, principles and ethos
of the Group. Some of the salient features of the
Charter would be the protocol for accepting new
directorships, the division of responsibilities and powers
between the Board and the management, the
Chairman and the CEO and the roles and
responsibilities of the committees established by the
Board. The Charter is periodically reviewed by the
Board and can be accessed on the Group’s corporate
website.
Re-election and Re-appointment
The responsibility of identifying candidates for
directorship and the re-election rests with the
Nomination and Remuneration Committee, in
accordance with its terms of reference. Potential
candidates are screened for the ideal mix of
capabilities, experience and expertise. Inputs from
other directors are also taken into consideration in
examining eligibility.
Directors’ Retirement
Pursuant to Section 129(2) of the Companies Act,
1965, Directors who are over the age of seventy (70)
years shall retire at every Annual General Meeting and
may offer themselves for re-appointment to hold office
until the conclusion of the next Annual General
Meeting.
On Directors retirement and re-election, the Company
Secretary shall advice Directors that fall within these
provisions at the coming AGM, the details of Directors
who are due for retirement and eligible for re-election
are set out in the Notice of the AGM form page 2 of
this Annual Report.
page
86
HeiTech Padu Berhad
Annual Report 2013
Statement of
Review of Performance and Independence of the
Board
The Board reviews and evaluates its own performance
and the performance of its Committees on an annual
basis. The assessment of the Board is based on specific
criteria, covering areas such as the Board structure,
Board operations, roles and responsibilities of the
Board, Board Committee and as well as the
Management performance.
The Board also reviews the independence of its
members to ensure that all of the independent
members are able to bring their objective and
independent judgement to the Board.
The results of the assessment would be reported by
the Nomination and Remuneration Committee to the
Board and essential for the Board to form the basis of
recommending relevant Director for re-election at the
Annual General Meeting.
• The Board is cognisance of the MCCG 2012’s
recommendations on the tenure of an independent
director that should not exceed a cumulative term
of nine (9) years. For the year under review, two
(2) directors have reached or will reach cumulative
terms of nine (9) years.
The Board has proposed for the retention of the two
(2) directors and Independent Non-Executive Directors
as follows:1. Tuan Haji Ghazali bin Awang; and
Directors Training
Due to the ever increasing complexities in doing
business, Directors are expected to upgrade their skill
sets and keep themselves abreast with the
developments in the business environment as well as
with any new relevant regulatory and statutory
requirements to maximise their effectiveness in serving
the interest of the Group.
During the financial year 2013, the Directors had
attended various training programmes relevant to their
duties and responsibilities. Among the trainings that
they had attended are:• Mandatory Accreditation Program by Bursatra Sdn.
Bhd.
• Wealth Creation & Preservation
• Quality Initiatives Talk: “The Leadership Code for
Asia”
• Research Methodology by University Industry
Selangor
• Corporate Directors Seminar by Tabung Haji
• Biosimilar, Never Ending Frontier in Bio-Business
• Embracing Risks for Long Term Corporate Success
– Boosting your Risk Governance by PNB Investment
Institute Sdn. Bhd.
• Inspiration & Innovation for Quantum Growth by
Kumpulan Perangsang Selangor Bhd.
• Annual Automative Insurance Industry Forum 2014
by Motordata Research Consortium.
2. Dato’ Mohd Fadzli bin Yusof
DIRECTORS REMUNERATION
In complying with Paragraph 7.23 of the LR of Bursa Malaysia Berhad, the details of the Directors’ remuneration
for the financial year ended 31 December 2013, are as follows:Fees
(RM)
Executive Directors
Non-Executive
Directors
312,567.45
Basic
Salary
(RM)
Bonus
(RM)
Benefits in
Kind
(RM)
617,800
71,261
79,100
Other
Emoluments
(RM)
Total
(RM)
768,161
312,567.45
page
www.heitech.com.my
Range of
Remuneration
(RM)
87
Executive
0-100,000
NonExecutive
a) Audit Committee
The present members of the Audit Committee are:
8
100,001-300,000
300,001-600,000
2
For the year under review there were two (2) executive
directors. Tuan Haji Safiee bin Mohammad and Dato’
Mohd Hilmey bin Mohd Taib. Tuan Haji Safiee retired
on 2 September 2013, whilst Dato’ Mohd Hilmey bin
Mohd Taib was redesignated as a Non-Executive
Director from 2 May 2013.
Members
Status
Tuan Haji
Ghazali bin
Awang
(Chairman)
Independent
Non-Executive
8/8
Tuan Syed Agel
bin Syed Salim
NonIndependent
Non-Executive
8/8
Wan Ainol Zilan
binti Abdul
Rahim
Independent
Non-Executive
Director
Appointed
w.e.f.
06.08.2013
3/3
Dato’ Ab. Halim
bin Mohyiddin
Independent
Non-Executive
Director
Retired w.e.f.
27.05.2013
4/4
Board Committees
The Board has established the following Board
Committees to assist the Board in discharging its duties:
• Audit Committee;
• Nomination Committee and Remuneration Committee;
• Employee Share Option Scheme (“ESOS”) Committee;
• Voluntary Separation Scheme (“VSS”) Committee;
• Technology Committee; and
• Risk Management Committee.
Members of these committees comply with the criteria
for independence provided under the LR of Bursa
Malaysia. Every committee has a separate and defined
written charter and terms of reference which has been
approved by the Board, describing the committee’s
authorities and responsibilities. The Chairperson of
each committee reports on items discussed and
action taken at their meetings to the Board, after the
conclusion of each meeting.
All Directors are provided with an agenda and a set
of Board papers prior to the Board meetings and
sufficient notice is given to the Directors to review the
papers and agenda for the meeting. Generally, the
Board papers circulated include minutes of the
previous and Committees’ meetings, quarterly and/or
annual financial statements, corporate development,
minutes of Board Committees’ meetings, acquisition
and disposal proposals, updates from Bursa Securities,
list of directors’ resolutions passed and summary of
directors’ dealings in securities during the relevant
financial period, if any. Chapter 14 of the LR prescribes
that deliberations during the Board and Board
Committees’ meetings should be properly minuted
and documented by the Company Secretary.
Attendance
Details of the composition, terms of reference,
and the Audit Committee Report are set out on
pages 78 to 82 of this Annual Report.
b) Nomination Committee and Remuneration
Committee
Members
Status
Attendance
Tuan Haji
Ghazali bin
Awang
(Chairman)
Independent
Non-Executive
2/2
Tan Sri Dato’ Sri
Abi Musa Asa’ari
bin Mohamed
Nor
Independent
Non-Executive
2/2
Dato’ Ab. Halim
bin Mohyiddin
Independent
Non-Executive
Director
Retired w.e.f.
27.05.2013
2/2
Sulaiman Hew
bin Abdullah
Appointed
w.e.f.
17.04.2014
nil
page
HeiTech Padu Berhad
88
Annual Report 2013
Statement of
The Nomination and Remuneration Committee
(“NCRC”) is empowered to review and make
recommendations to the Board in identifying
suitable candidates for Directorship. The NCRC
considers various aspects which include the
competencies, commitment, contribution and
performance of a candidate. On top of that, the
NCRC also facilitates with the Board’s induction of
new members and training programmes for the
Directors.
The other role of the NCRC is to consider and
recommend to the Board the remuneration
schemes for the Directors and the CEO. The NCRC
will regularly review and compare the scheme
which is benchmarked against the industry.
Independent directors may not receive, directly or
indirectly, any consulting, advisory or other
compensatory fees from the Company.
Members
Status
Dato’ Mohd Hilmey bin
Mohd Taib
(Chairman)
Chairman
Tuan Haji Ghazali bin Awang Independent
Non-Executive
The Company is in compliance with the MCCG
2012 in relation to gender diversity and will select
candidates that would be able to fulfil the criteria
of integrity and competency, regardless of gender.
c) Employee Share Option Scheme (“ESOS”)
Committee
d) Voluntary Separation Scheme (“VSS”) Committee
Dato’ Dr. Mohamed Ariffin
bin Aton
NonIndependent
Non-Executive
Tuan Haji Safiee bin
Haji Mohammad
Executive
Director
Retired w.e.f.
02.09.2013
The Committee assists the Board in the
administration and execution of the VSS scheme
for the Group, if such a need arises.
e) Technology Committee
No. of
Meeting
Members
Status
Tuan Haji Safiee
bin Haji
Mohammad
(Chairman)*
Executive
Director
Retired w.e.f.
02.09.2013
Nil
Tuan Haji Ghazali bin Awang Independent
Non-Executive
Dato’ Dr.
Mohamed Ariffin
bin Aton
NonIndependent
Non-Executive
Nil
Dato’ Ab. Halim bin
Mohyiddin
Harris bin Ismail
Group Chief
Executive
Officer
Nil
Ou Shian Waei
Independent
Non-Executive
Director
Retired on
26.06.2013
Nil
Members
Status
Tan Sri Dato’ Sri Abi Musa
Asa’ari bin Mohamed Nor
Independent
Non-Executive
Independent
Non-Executive
Director
Retired w.e.f.
27.05.2013
This committee was set up to assist the Board in
the proper implementation of the ESOS scheme
under its By-Laws and Guidelines. This is undertaken
with the proper execution of the ESOS, within the
defined terms of reference and also with the
establishment, amendment and resolution of rules
and regulations relating to the scheme and its
administration
* Even though Tuan Haji Safiee bin Haji
Mohammad retired as an Executive Director,
he is still a member of the Technology
Committee.
page
www.heitech.com.my
89
This committee was set up to deliberate on
technology direction of the Company as follows:-
SHAREHOLDERS
i) to review, evaluate and decide on the
Group’s major technology plans and
strategies, including its research and
development activities as well as technical
and market risks associated with product
development and investment;
Along with good corporate governance practices, the
Group is committed to provide investors and the
public with comprehensive, accurate and material
information on a timely basis. In line with this
commitment, the company is guided by the Corporate
Disclosure Guide issued by Bursa Malaysia Securities
Berhad.
ii) to monitor and evaluate future trends in
technology that can improve the Group’s
strategic plans; and
iii) monitoring of overall industry trends and
assessing potential new technology markets.
g) Risk Management Committee (“RMC”)
No. of
Meeting
Members
Status
Dato’ Mohd
Fadzli bin Yusof
(Chairman)
Independent
Non-Executive
2/2
Dato’ Dr.
Mohamed Ariffin
bin Aton
NonIndependent
Non-Executive
2/2
Harris bin Ismail
Group Chief
Executive
Officer
2/2
Corporate Disclosure
The Group through its field of expertise leverages on
the use of information technology for effective
dissemination of information by maintaining an official
website at www.heitech.com.my which shareholders or
the public can access information and updates on
the Group, including public announcements, quarterly
results, the Annual Report and also will be updated to
include policies, shareholders rights, board charter
and code of conduct in its commitment with the
recommendations of the Code.
The RMC works closely with the Group Risk
Management Committee (“GRMC”) to deliberate
on the corporate and operational risks of the
Group. The GRMC implements the Risk
Management Framework and Policy for the Group,
assesses potential risks and monitors the risk
register and reports the summary of risk
management issues and initiatives to the RMC.
The half yearly report is then shared with the
Board Members for information and feedback.
The Group recognises the importance of having
effective communication with its shareholders at
Annual General Meeting. Therefore, the Board allocates
time and welcome questions and feedback regarding
directions, operations, financials from the shareholders
at the General meeting.
The Board has taken initiatives for the Group to publish
all relevant information to enable the shareholders to
exercise their rights through the Company’s website.
Investors Relations
The shareholders and the public may address their
queries regarding the Group to the following persons:i) Ahmad Noor Sulong (Group General Counsel &
Company Secretary)
– Tel: 03-8601 3000 or [email protected]
ii) Rosman Mustafa Kamar (for Investor Relation and
Shareholders Communication)
– Tel: 03-8601 3000 or [email protected]
page
90
HeiTech Padu Berhad
Annual Report 2013
Statement of
ACCOUNTABILITY AND AUDIT
ADDITIONAL COMPLIANCE INFORMATION
Financial Reporting
The following information is provided in compliance
with paragraph 9.25 of Bursa Malaysia LR.
The Board is responsible for presenting a balanced,
clear and transparent assessment of the Group’s
financial performance and prospect through the
quarterly and annual financial reporting to
shareholders. The Group via the Audit Committee’s
scrutiny, complies with the requirement applicable
under the Malaysian Approved Accounting Standards
Board in preparing the annual and quarterly financial
statements. The Audit Committee ensures that the
financial and statutory compliance aspects of the
audited financial statements and adherence to
internal policies and procedures prior to full deliberation
at the Board level are strictly followed.
External Auditors
The management maintains a close and transparent
relationship with the External Auditors in seeking
professional advice and ensuring compliance with the
applicable approved accounting standards.
The role of the Audit Committee in relation to the
External Auditors is found in the Audit Committee
Report is on page 80 of this Annual Report.
Risk Management and Internal Control
The Board of Directors recognise the importance of
having sound internal controls and risk management
practices to good corporate governance. The Board
affirms its overall responsibility for the Group’s systems
of internal control and risk management, and for
reviewing the adequacy and effectiveness of the
same from time to time. It is to be noted that such
systems is designed to identify, evaluate and manage
significant risk of the Group.
The Board is assisted by Audit & Assurance in the
implementation of risk management processes within
the Group. A Risk Management Committee, has also
been set up and entrusted with the role of identifying
business risks and in ensuring the implementation of
the systems are in appropriate way.
The statement of the Company on risk management
and internal control system is set out in the Statement
of Internal Control on page 92 in this Annual Report.
i)
Options, Warrants or Convertible Securities
The Group did not issue any options, warrants or
convertible securities during the financial year
under review.
ii) Imposition of Sanction/Penalties
There were no sanctions and/or penalties imposed
on the Group and/or its subsidiary companies,
Directors or management arising from any
significant breach of rules/guidelines/legislation
by the relevant regulatory bodies during the
financial year ended 31 December 2013.
iii) Material Contracts
Neither Group and/or its subsidiary companies
had entered into any material contracts which
involved Directors’ and major shareholders’ interest
during the financial year ended 31 December
2013, save as disclosed under Disclosure to BMSB
on page 96 of the Annual Report.
iv) Non-Audit Fees
The amount of non-audit fees paid to the external
auditors by the Group is set out in Note 9 to the
financial statements for the year ended 31 December
2013 on page 142 of this Annual Report.
v) Profit Guarantee
There was no profit guarantee given by the Group
during the financial year ended 31 December 2013.
vi) Revaluation Policy on Landed Properties
There was no revaluation of properties of the
Group during the financial year ended
31 December 2013.
vii) Share Buy Back
There was no share buy back exercise done during
the financial year ended 31 December 2013.
viii)American Depository Receipt (“ADR”) or Global
Depository Receipt (“GDR”) programme
The Group did not sponsor any ADR or GDR
program during the financial year ended
31 December 2013.
The statement was duly reviewed and approved by
the Board of Directors of HeiTech Padu Bhd. on 17 April
2014.
page
www.heitech.com.my
91
STATEMENT ON RISK MANAGEMENT
AND INTERNAL CONTROL
BOARD RESPONSIBILITY
INTRODUCTION
Principle 6 of the Malaysian Code on Corporate
Governance 2012 (“MCCG 2012”) states that the
Board should establish a sound risk management
framework and internal control system. In
compliance with the provision of Bursa Malaysia
Securities Berhad (“BMSB”) Listing Requirements
Paragraph 15.26 (b) and Statement on Risk
Management and Internal Control : Guidance
for Directors of Listed Issuers (“Risk Management
and Internal Control Guidance”), the Board of
Directors (“the Board”) is committed to establish
a sound risk management framework and
internal control system, and is pleased to present
the following Statement on Risk Management
and Internal Control (“SRMIC”), which illustrates
the risk management framework and scope of
the internal control during the year under review.
The Board acknowledges its responsibility for
a sound risk management framework and
internal control system to safeguard
shareholders’ investments and the Group’s
assets. The Board is responsible overall for
the key elements needed in maintaining a
sound system of risk management and
internal control in HeiTech Padu Berhad
(“HeiTech”) and subjects the system to a
process of regular reviews to ensure its
continued relevance, effective and applicable
to the changes in the Group’s structure,
processes and dynamic business environment.
The risk management framework and internal
control systems cover, inter alia, financial,
organisational, operational, project and
compliance controls. As there are limitations
that are inherent in any risk management
and internal control systems, these systems
are designed to manage rather than
eliminate risks of failure to achieve the
Group’s business objectives. Accordingly, it
can only provide reasonable but not absolute
assurance against material misstatement or
loss.
page
92
HeiTech Padu Berhad
Annual Report 2013
Statement on Risk Management
and Internal Control
HeiTech risk management and internal control systems
do not apply to its associated companies and joint
controlled entities, which fall within the control of their
majority shareholders. The interests of HeiTech Padu
Berhad are served through representation on the
board of the respective companies. These
representations provide the Board with information for
strategic decision making in view of the continuity of
the Group’s investment.
Management Committee. The Committee is
responsible for the overall oversight, implementation
and monitoring of the group-wide ERM System.
Details of the members of the Committee are
furnished in the Statement on Corporate
Governance at page 89 of the Annual Report.
c) Business Continuity Management (BCM)
RISK MANAGEMENT
The Board is responsible to ensure and implement
appropriate systems to manage risks. The Board
ensures that HeiTech’s risks are identified, evaluated,
and managed by on-going systems and continuous
processes. The Internal Control Structures describe in
the following section are functioning and capable of
performing the overall risk management framework
and internal control system of HeiTech.
a) Enterprise Risk Management (ERM) Process
The Group's key risk profile was developed by the
Management. Risks identified were assessed in
terms of the possibility of occurrence and the
impact to the Group if the risk materialise. The
Group’s key risk profile is reviewed by the Risk
Committee on regular basis to verify and confirm
the identified risk. Risk mitigation plan will be
developed based on the input by the corporate
officers such as Finance, Project Management,
Corporate Services and Audit & Assurance. The
mitigation plan will be escalated to all levels in
HeiTech and will be monitored on monthly basis.
The management of risks in the daily business
operation is assigned to management team and
significant risks are identified and related mitigating
responses as well as the corresponding internal
controls are discussed at the Risk Management
Committee and/or board meetings.
The above-mentioned practices serve as an
ongoing process adopted by the Management to
identify, evaluate and manage significant risks
faced by the Group in achieving its business
objectives and strategies.
b) Risk Management Committee
The Board after due deliberation in its Special
Board Meeting held on 17 April 2013 to signify the
Group's Commitment in further enhancing our risk
management system, had established a Risk
The Management has embarked on a BCM
programme to provide a framework for building
organisational resilience with the capability for an
effective response that safeguards the interest of
its key stakeholders, reputation and brand.
d) Assurance from Management
In accordance with the Statement on Risk
Management & Internal Control – Guidelines for
Directors of Listed issuers, the Board has received
assurance from the Chief Executive Officer and
Chief Financial Officer that to the best of their
knowledge the risk management and internal
control of the HeiTech Group are operating
effectively and adequately, in all material respects,
based on the risk management and internal
control framework adopted by the HeiTech Group.
INTERNAL CONTROL STRUCTURES
The Board is committed in maintaining an effective
control structure and environment for the proper
conduct of HeiTech’s business operations. The following
key Internal Control Structures were implemented to
ensure effective control environment and provide key
elements needed in maintaining a system of risk
management and internal control:
a) Organisation structure
• Various Board Committees that are administered
by defined terms of reference;
i.
the Audit Committee;
ii.
the Risk Management Committee;
iii. the Nomination Committee;
iv. the Remuneration Committee;
v. the Technology Committee; and
vi. E m p l o y e e
Committee.
Share
Option
Scheme
• The Group organisation structure that reflects
defined Key Result Area and Key Performance
Indicators (“KRA/KPIs”).
page
www.heitech.com.my
b) Board and Management meetings
• Board Meetings and a year-end Special Board
Meeting monitor and deliberate the whole
spectrum of the Group’s strategic business
targets, directions and challenges.
• Executive Committee Meetings that deliberate
strategic business direction and review the
financial and operational performances of
HeiTech in ensuring that business targets are
achieved and customers’ requirements are
met.
• Management Committee Meetings that review
the overall group operation, business and
financial performance, execution of group
strategic decision, implementation of quality
and business processes in ensuring that overall
group operation are effectively managed and
operated.
• Project Steering Committee Meetings that
monitors the projects performance and
implementation.
• Technology Committee Meetings that review,
evaluate and decide on HeiTech’s major
technology plans and strategies, including
monitoring the industry trends and assessing
new technology in the markets. This Council
also provides platform for nurturing innovation.
• Central Review Committee Meetings that
review and evaluate business proposals to
ensure that strategic solution, strategic pricing
and strategic partnership (with customers and
various types of partners) are appropriately
considered.
• Technical Steering Committee Meetings that
review all projects to ensure the right scope of
work and the right duration and effort
estimation of the project based on the project
risk analysis by Central Project Management
Office (Central PMO).
• P r o c u r e m e n t C o m m i t t e e M e e t i n g s t h a t
administer and manage the procurement
acquisition processes and approval.
• Business review that appraises HeiTech’s
business and operational achievements
against the business objectives and targets.
93
c) Audit Committee
• Audit Committee, majority of whom comprises
of Independent Non-Executive Directors duly
executes its duties as defined in the Terms of
Reference. Audit Committee regularly reviews,
on behalf of the Board, internal control issues
reported by the Internal Auditors and External
Auditors, including any significant internal
control issues affecting the financial statements.
• Further details of the activities undertaken by
the Audit Committee are set out in the Audit
Committee Report.
d) Internal Audit (Audit & Assurance)
• Defined KRA/KPIs for the Internal Audit function
to manage and oversee the Group operational,
strategic and compliance auditing activities
during the year under review.
• The Internal Audit function of HeiTech is carried
out by the Audit & Assurance Division. The
Audit & Assurance Division operates
independently of management and reports
directly to the Audit Committee. In providing
independent and impartial appraisal, the
internal auditors are given full, free and
unrestricted access to all records, information,
property, personnel and other relevant
resources within the Group.
• Internal Audit provides independent assessment
on HeiTech’s internal control systems and
attended the ad-hoc audit review as and
when requested by the Audit Committee and
Management. All the result of the audit exercise
including follow up audit report will be tabled
and deliberated at the Audit Committee
meeting.
e) Limits of Authority, Policies and Procedures
• Limits of Authority that outlines the authorised
signatories’ authority in contractual, financial
and procurement approvals and execution.
• Centralised Policies and Procedures of various
Divisions, Department, Units and Projects Teams
of the Group through the central depository of
process management.
page
94
HeiTech Padu Berhad
Annual Report 2013
Statement on Risk Management
and Internal Control
f) Quality Management Systems, Certification and
Standards
• Achieved and complied with the MS ISO
9001:2008 Quality Management System
(“QMS”) certifications since 1998. The scope of
certification covering 12 areas that includes
Legal Services, Human Resources Management,
Competency Development & Training,
Procurement, Audit & Assurance, Corporate
Communication, Practices Management,
Network Services, Data Center Operations for
PNB, Call Center Operations, Program
Management Office of HeiTech Managed
Services and PNB Project.
• Achieved and retained with the ISO/IEC
27001:2005 Information Security Management
System (“ISMS”) certification since 2006 for
services provided by HeiTech Managed
Services. The scope of certification covers
Padu*Net Nodes Infrastructure, Business
Recovery Management Services, Internet Data
Center Services, Desktop Management Services
and Call Center Operations Services.
• Achieved and complied with the ISO/IEC
20000:2011 Service Management System
(“SMS”) certification since 2010. The scope of
certification covers Wide Area Network (WAN),
Local Area Network/Desktop Management
Services, Data Center Services and Helpdesk
Support Services.
• Internal Quality audits and follow up audits
were performed on all QMS, ISMS and SMS
scopes by the pools of certified internal
auditors. An annual Surveillance Audit and a
Re-certification Audit in every 3 years will be
carried out by SIRIM QAS International on these
certifications.
• Adoption of structured methodologies for IT
Project Management (Project Management
Information System, “PROMISE”) and Application
Development (Application Development
Information System, “ADVISE”) which comply to
the Capability Maturity Model® Integration
(“CMMI”) Maturity Level 3 certification
requirement from Software Engineering Institute
(“SEI”). CMMI is a process improvement model
that provides guidance for improving
organisation’s processes and ability to manage
the development, acquisition and maintenance
of products and services. A monthly compliance
assessment is being carried out by the Central
PMO.
• The Data Center in HeiTech Village 2 (HTV 2) is
designed and maintained in accordance to
Uptime Institute Standards on mechanical and
electrical (M&E) component and Tier IV ready
under the Telecommunication Industry
Association – Telecommunications Infrastructure
Standards for Data Centers (TIA942) on 4
components i.e. Mechanical (cooling system),
Electrical (based on Uptime), Architectural
(civil & structures) and Network (connectivity
for WAN & LAN).
g) Strategic Planning
• P r e p a r e B u s i n e s s P l a n o f H e i T e c h a n d
consolidates Business Plan for all HeiTech
Group of Companies. The business plan will be
presented, deliberated and approved by the
Board of HeiTech.
• Prepare the Operational Master Plan for all
HeiTech Group of Companies in order to
monitor and review the Company’s performance
to ensure that it is according to their target.
• Conduct Knowledge Sharing Session within
HeiTech Group of Companies to create synergy
among the Companies including Chief
Executive Officers (CEO) Forum.
• Conduct Mid-Year Review and Business
Planning Session to review the Companies’
performance strategic direction.
h) Defined Business Process & Improvement
• Process Improvements and Compliance
Assessment initiatives are continuously instituted
throughout the HeiTech Group as part of the
internal control framework. They are designed
to manage risks that may affect the
achievement of business objectives and
reviewed from time to time to keep up with the
changes in the business environment or
regulatory guidelines.
• Defined business processes of HeiTech are
made available online through
http://ipractices.heitech.com.my/hdp/.
• Dedicated Practices Management Department
(PMD) was established as to ensure continuous
process improvement and process awareness
for the organisation.
www.heitech.com.my
i)
Human Capital Development and Training
• A Performance Management mechanism is
established based on both Balanced Scorecard
System (BSC) and Competency Assessment &
Development (CAD). The BSC is defined topdown where business objectives are clearly
defined and targets are set for individual staff.
Staffs are also appraised through CAD system
where individual competencies are evaluated
against the required job skill, hence identifying
the gap on skill of the staff. Formal training
programs are planned annually to ensure the
Board Management and staff are adequately
trained and competent. Relevant policies and
procedures are in place as proper guideline to
the process.
j) Legal and Regulatory Compliance
• Defined processes, procedures and monitoring
mechanism govern the practice and
performance of contractual formulation and
review.
• Keeping vigilance of any domestic and
international legal and regulatory compliance
matters that may affect HeiTech’s Business
operations.
• Awareness programs and road shows on roles
and responsibilities of a service provider and
contract management.
k) C o m m u n i c a t i o n a n d C o r p o r a t e I d e n t i t y
Management
• Continuous monitoring on any matter with
regards to communications processes,
procedures and guidelines to ensure that
communications across the Group is effectively
managed and fulfil the needs of the
stakeholders.
• Optimising on the establishment of Brand Book
as a centralised platform of reference for
employees to ensure corporate identity of the
Company is well maintained across all media
applications.
page
95
For the financial year under review, the Board is
satisfied that there were no material losses,
contingencies or uncertainties incurred as a result of
weaknesses in the systems of internal control. The
Management continues to take measures to strengthen
the risk management and internal control systems.
This Statement on Risk Management and Internal
Control has been reviewed by the External Auditors,
Messrs. Hanafiah Raslan & Mohamad, in compliance
with Recommended Practice Guide (“RPG”) 5 issued
by Malaysian Institute of Accountants (“MIA”).
This statement is made in accordance with the
resolution of the Board of Directors dated 17 April
2014.
page
HeiTech Padu Berhad
96
Annual Report 2013
DISCLOSURE TO
BURSA MALAYSIA
NO.
DATE
ANNOUNCEMENT
1.
01 May 2014
Annual Audited Accounts – 31 December 2013
2.
30 Apr 2014
Transactions (Chapter 10 of Listing Requirements) Recurrent Related Party Transactions.
Proposed Renewal of Shareholders Mandate for Recurrent Related Party Transactions of A
Revenue or Trading Nature.
3.
27 Feb 2014
Quarterly rpt on consolidated results for the financial period ended 31 December 2013.
4.
14 Feb 2014
Article entitled “HeiTech to be taken private?”
5.
06 Feb 2014
Acceptance of letter of award for the expansion of the “Sistem Pengurusan Pesakit” (“SPP”)
(Patient Management System) version 3.0, inclusive of the supply, upgrade of infrastructure
at Hospital Bentong, Pahang, Hospital Raja Perempuan Zainab II, Kota Bharu and Hospital
Tuanku Ja’afar Seremban for Ministry of Health Malaysia.
6.
06 Feb 2014
Acceptance of letter of award for the supply, deliver, install, test, configure and commissioning
of ict equipment for the expansion of the “Sistem Pengurusan Pesakit” (“SPP”) Version 3 at
Hospital Raja Perempuan Zainab II, Kota Bharu, Hospital Tuanku Ja'afar, Seremban and
Hospital Bentong, Pahang for Ministry Of Health Malaysia.
7.
27 Dec 2013
Notice of Interest Sub. S-hldr (29A) – Permodalan Nasional Berhad.
8.
27 Dec 2013
Notice of Person Ceasing (29C) – Amanahraya Trustees Berhad.
9.
27 Dec 2013
Notice of Interest Sub. S-hldr (29A) – Yayasan Pelaburan Bumiputra (YPB).
10.
28 Nov 2013
Quarterly rpt on consolidated results for the financial period ended 30 September 2013.
11.
23 Oct 2013
Acceptance of letter of award for The Supply, Delivery Installation Testing, Commissioning
And Maintenance Of Mainframe Hardware And Software Tape Subsystem for Jabatan
Pendaftaran Negara (“National Registration Department”).
12.
17 Sep 2013
Change Of Company Secretary
13.
03 Sep 2013
Agreement between The Department Of Immigration and Emigration of Sri Lanka and
HeiTech Padu Berhad for The Supply of 1.5 Million Blank ‘N’ Series Passport (“Contract”).
14.
02 Sep 2013
Change in Boardroom.
15.
28 Aug 2013
Quarterly rpt on consolidated results for the financial period ended 30 June 2013.
16.
28 Aug 2013
Agreement between The Department Of Immigration And Emigration of Sri Lanka and
HeiTech Padu Berhad (“HeiTech”) for The Supply Of 1.5 Million Blank ‘N’ Series Passports to
The Department of Immigration and Emigration.
17.
06 Aug 2013
18.
06 Aug 2013
Change in Audit Committee.
19.
31 Jul 2013
20.
30 Jul 2013
page
www.heitech.com.my
97
NO.
DATE
ANNOUNCEMENT
21.
26 Jun 2013
General Meetings: Outcome of Meeting.
22.
26 Jun 2013
23.
06 Jun 2013
Acceptance of The letter of award for The Maintenance And Services of Computer Systems
for Data Center at Jabatan Imigresen Malaysia (“JIM”).
24.
28 May 2013
Annual Report 2012.
25.
28 May 2013
General Meetings: Notice Of Meeting.
26.
28 May 2013
Circular to shareholder on proposed renewal of shareholders’ mandate for recurrent related
party transactions of a revenue or trading nature.
27.
27 May 2013
28.
27 May 2013
29.
27 May 2013
30.
23 May 2013
Quarterly rpt on consolidated results for the financial period ended 31 March 2013.
31.
02 May 2013
32.
30 Apr 2013
Annual Audited Accounts – 31 December 2012.
33.
22 Apr 2013
Transactions (chapter 10 of listing requirements):non related party transactions disposal of
shares in Grand-Flo Solution Bhd.
34.
19 Apr 2013
Transactions (chapter 10 of listing requirements):non related party transactions disposal of
shares in Grand-Flo Solution Bhd.
financial
statements
100 Statement of Directors’ Responsibilities
101 Directors’ Report
106 Statement by Directors
106 Statutory Declaration
107 Independent Auditors’ Report
109 Statements of Comprehensive Income
111 Statements of Financial Position
113 Statements of Changes in Equity
115 Statements of Cash Flows
118 Notes to The Financial Statements
190 Supplementary Information
page
100
HeiTech Padu Berhad
Annual Report 2013
STATEMENT OF
DIRECTORS’ RESPONSIBILITIES
Under the Companies Act 1965, the Directors are required to prepare financial statements, which disclose a true
and fair view of the state of affairs of the Group at the end of each financial year and of their results and
cashflow for the year then ended.
The Directors consider that in preparing the financial statements:
• the Group applied appropriate and consistent accounting policies;
• reasonable and prudent judgments and estimates were made; and
• all applicable MASB Approved Accounting Standards in Malaysia For Entities Other Than Private Entities have
been adhered with.
The Directors are responsible for ensuring that the Group and Company keep proper accounting records, which
disclose with reasonable accuracy at any time the financial position of the Group and to enable them to ensure
that the financial statements comply with the Companies Act 1965.
The Directors have general responsibilities for taking such steps that are reasonably available to them to
safeguard the assets of the Group and the Company and to prevent and detect fraud and other irregularities.
page
www.heitech.com.my
101
DIRECTORS’
REPORT
DIRECTORS’ REPORT
The directors hereby present their report together with the audited financial statements of the Group and of the
Company for the financial year ended 31 December 2013.
PRINCIPAL ACTIVITIES
The principal activities of the Company are the provision of systems integration, network related services, data
centre management, disaster recovery services and other information technology related services. Under the
Communications and Multimedia Act (CMA) 1998 Framework, the provision of network related services and
internet data centre services are licensed as Network Services Provider Individual License (NSP (i)) and
Application Service Provider Class License (ASP (c)) respectively.
The principal activities of the subsidiaries are described in Note 15 to the financial statements.
There have been no significant changes in the nature of the principal activities during the financial year.
RESULTS
GroupCompany
RM’000RM’000
Loss from continuing operation, net of tax
Loss from discontinued operation, net of tax
(33,051)
(298)
(45,872)
–
Loss for the year, net of tax
(33,349)
(45,872)
Owners of the parent
Non-controlling interests (32,743)
(606)
(45,872)
–
(33,349)(45,872)
Loss attributable to:
There were no material transfers to or from reserves or provisions during the financial year other than as disclosed
in the financial statements.
In the opinion of the directors, the results of the operations of the Group and of the Company during the
financial year were not substantially affected by any item, transaction or event of a material and unusual nature.
DIVIDENDS
The directors do not recommend the payment of any dividend for the current financial year.
page
102
HeiTech Padu Berhad
Annual Report 2013
Directors’
Report

DIRECTORS
The names of the directors of the Company in office since the date of the last report and at the date of this
report are:
Dato’ Mohd. Hilmey bin Mohd. Taib
Dato’ Mohd. Fadzli bin Yusof
Tan Sri Abi Musa Asa’ari bin Mohamed Nor
Dato’ Dr. Mohamed Ariffin bin Aton
Sulaiman Hew bin Abdullah (appointed on 30 July 2013)
Wan Ainol Zilan binti Abdul Rahim (appointed on 6 August 2013)
Dato’ Ab. Halim bin Mohyiddin (resigned on 27 May 2013)
Ou Shian Waei (retired on 26 June 2013)
Tuan Haji Safiee bin Mohammad (retired on 2 September 2013)
In accordance with Article 82 of the Company’s Articles of Association, Tuan Haji Ghazali Awang, Dato’ Mohd
Fadzli bin Yusof and Tan Sri Abi Musa Asa’ari bin Mohamed Nor retire from the Board of Directors by rotation at
the forthcoming Annual General Meeting. Tuan Haji Ghazali Awang, Dato’ Mohd Fadzli bin Yusof and Tan Sri
Abi Musa Asa’ari bin Mohamed Nor, being eligible, offer themselves for re-election.
In accordance with Article 85 of the Company’s Articles of Asociation, Sulaiman Hew bin Abdullah and Wan
Ainol Zilan binti Abdul Rahim retire from the Board of Directros at the forthcoming Annual General Meeting.
Sulaiman Hew bin Abdullah and Wan Ainol Zilan binti Abdul Rahim, being eligible, offer themselves for reelection.
DIRECTORS’ BENEFITS
Neither at the end of the financial year, nor at any time during that year, did there subsist any arrangement to
which the Company was a party, whereby the directors might acquire benefits by means of the acquisition of
shares in or debentures of the Company or any other body corporate, other than those from the share options
granted pursuant under the Employee Share Option Scheme (“ESOS”).
Since the end of the previous financial year, no director has received or become entitled to receive a benefit
(other than benefits included in the aggregate amount of emoluments received or due and receivable by the
directors or the fixed salary of a full-time employee of the Company as shown in Note 7 to the financial
statements) by reason of a contract made by the Company or a related corporation with any director or with
a firm of which the director is a member, or with a company in which the director has a substantial financial
interest.
page
www.heitech.com.my
103
DIRECTORS’ INTERESTS
According to the register of directors’ shareholdings, the interests of directors in office at the end of the financial
year in shares and options over shares in the Company and its related corporations during the financial year
were as follows:
Number of ordinary shares of RM1.00 each
1 January 31 December
2013Bought Sold 2013
The Company
Direct Interest
7,820,184
12,500
–
–
–
–
7,820,184
12,500
The Company
Indirect Interest*
30,521,028
–
–
30,521,028
* Held through Padujade Corporation Sdn. Bhd.
Padusoft Sdn. Bhd., a subsidiary of the Company
Direct Interest
The Company
1
–
–
1
Number of options to subscribe for ordinary shares
of RM1.00 each pursuant to ESOS
1 January
31 December
2013 GrantedExercised Lapsed
2013
400,000
–
–
(400,000)
–
Dato’ Mohd. Hilmey bin. Mohd. Taib by virtue of his interest in shares in the Company is also deemed interested
in shares of all the Company’s subsidiaries to the extent the Company has an interest.
None of the other directors in office at the end of the financial year had any interest in shares in the Company
or its related corporations during the financial year.
page
104
HeiTech Padu Berhad
Annual Report 2013
Directors’
Report

EMPLOYEE SHARE OPTION SCHEME
The HeiTech Padu Employee Share Options Scheme (“ESOS”) is governed by the by-laws approved by the
shareholders at an Extraordinary General Meeting held on 18 June 2003. The ESOS was implemented on 30 July
2003 and is to be in force in accordance with by-laws for a period of 10 years from the date of implementation.
The ESOS has expired on 13 May 2013.
The salient features and other terms of the ESOS are disclosed in Note 30 to the financial statements.
The Company has been granted exemption by the Companies Commission of Malaysia from having to disclose
the names of employees, who have been granted options to subscribe for less than 50,000 ordinary shares of
RM1.00 each. There are no options granted to employees, other than executive directors, to subscribe for 50,000
or more ordinary shares of RM1.00 each during the financial year.
OTHER STATUTORY INFORMATION
(a) Before the statements of comprehensive income and statements of financial position of the Group and of
the Company were made out, the directors took reasonable steps:
(i) to ascertain that proper action had been taken in relation to the writing off of bad debts and the
making of provision for doubtful debts and satisfied themselves that there were no known bad debts
and that adequate provision had been made for doubtful debts; and
(ii) to ensure that any current assets which were unlikely to realise their value as shown in the accounting
records in the ordinary course of business had been written down to an amount which they might be
expected so to realise.
(b) At the date of this report, the directors are not aware of any circumstances not otherwise dealt with in this
report or financial statements of the Group and of the Company which would render:
(i) it necessary to write off any bad debts or the amount of the provision for doubtful debts in the financial
statements of the Group and of the Company inadequate to any substantial extent; and
(ii) the values attributed to the current assets in the financial statements of the Group and of the Company
misleading.
(c) At the date of this report, the directors are not aware of any circumstances which have arisen which would
render adherence to the existing method of valuation of assets or liabilities of the Group and of the
Company misleading or inappropriate.
(d) At the date of this report, the directors are not aware of any circumstances not otherwise dealt with in this
report or financial statements of the Group and of the Company which would render any amount stated
in the financial statements misleading.
(e) As at the date of this report, there does not exist:
(i) any charge on the assets of the Group and of the Company which has arisen since the end of the
financial year which secures the liabilities of any other person; or
(ii) any contingent liability of the Group and of the Company which has arisen since the end of the
financial year.
www.heitech.com.my
page
105
OTHER STATUTORY INFORMATION (CONT’D.)
(f) In the opinion of the directors:
(i) no contingent liability or other liability has become enforceable or is likely to become enforceable within
the period of twelve months after the end of the financial year which will or may affect the ability of
the Group and of the Company to meet their obligations as and when they fall due; and
(ii) no item, transaction or event of a material and unusual nature has arisen in the interval between the
end of the financial year and the date of this report which is likely to affect substantially the results of
the operations of the Group and of the Company for the financial year in which this report is made.
SIGNIFICANT EVENTS
Details of the significant events are disclosed in Note 11 and Note 15 to the financial statements.
AUDITORS
The auditors, Hanafiah Raslan & Mohamad, have expressed their willingness to continue in office.
Signed on behalf of the Board in accordance with a resolution of the directors dated 30 April 2014.
Haji Ghazali bin Awang
page
106
HeiTech Padu Berhad
Annual Report 2013
STATEMENT BY
DIRECTORS
PURSUANT TO SECTION 169(15) OF THE COMPANIES ACT 1965
We, Dato’ Mohd. Hilmey bin Mohd. Taib and Haji Ghazali bin Awang, being two of the directors of HeiTech Padu
Berhad, do hereby state that, in the opinion of the directors, the accompanying financial statements set out on
pages 109 to 189 are drawn up in accordance with Malaysian Financial Reporting Standards, International
Financial Reporting Standards and the requirements of the Companies Act 1965 in Malaysia so as to give a true
and fair view of the financial position of the Group and of the Company as at 31 December 2013 and of their
financial performance and cash flows for the year then ended.
The information set out in Note 38 to the financial statements have been prepared in accordance with the
Guidance on Special Matter No. 1, Determination of Realised and Unrealised Profits or Losses in the Context of
Disclosure Pursuant to Bursa Malaysia Securities Berhad Listing Requirements, as issued by the Malaysian Institute
of Accountants.
Signed on behalf of the Board in accordance with a resolution of the directors dated 30 April 2014.
Haji Ghazali bin Awang
STATUTORY
DECLARATION
PURSUANT TO SECTION 169(16) OF THE COMPANIES ACT 1965
I, Ahmad Nasrul Hakim bin Mohd Zaini, being the officer primarily responsible for the financial management of
HeiTech Padu Berhad, do solemnly and sincerely declare that the accompanying financial statements set out
on pages 109 to 189 are in my opinion, correct and I make this solemn declaration conscientiously believing
the same to be true and by virtue of the provisions of the Statutory Declarations Act 1960.
Subscribed and solemnly declared
by the abovenamed
at Kuala Lumpur on 30 April 2014
Before me,
page
www.heitech.com.my
107
INDEPENDENT
AUDITORS’ REPORT
TO THE MEMBERS OF HEITECH PADU BERHAD
(INCORPORATED IN MALAYSIA)
REPORT ON THE FINANCIAL STATEMENTS
We have audited the financial statements of HeiTech Padu Berhad, which comprise statements of financial
position as at 31 December 2013 of the Group and of the Company, and statements of comprehensive income,
statements of changes in equity and statements of cash flows of the Group and of the Company for the year
then ended, and a summary of significant accounting policies and other explanatory information, as set out on
pages 109 to 189.
Directors’ responsibility for the financial statements
The directors of the Company are responsible for the preparation of financial statements so as to give a true
and fair view in accordance with Malaysian Financial Reporting Standards, International Financial Reporting
Standards and the requirements of the Companies Act 1965 in Malaysia. The directors are also responsible for
such internal control as the directors determine is necessary to enable the preparation of financial statements
that are free from material misstatement, whether due to fraud or error.
Auditors’ responsibility
Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our
audit in accordance with approved standards on auditing in Malaysia. Those standards require that we comply
with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the
financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the
financial statements. The procedures selected depend on our judgement, including the assessment of risks of
material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments,
we consider internal control relevant to the entity’s preparation of financial statements that give a true and fair
view in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of
expressing an opinion on the effectiveness of the entity’s internal control. An audit also includes evaluating the
appropriateness of accounting policies used and the reasonableness of accounting estimates made by the
directors, as well as evaluating the overall presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our
audit opinion.
Opinion
In our opinion, the financial statements give a true and fair view of the financial position of the Group and of
the Company as at 31 December 2013 and of their financial performance and cash flows for the year then
ended in accordance with Malaysian Financial Reporting Standards, International Financial Reporting Standards
and the requirements of the Companies Act 1965 in Malaysia.
page
108
HeiTech Padu Berhad
Annual Report 2013
Independent
auditors’ report
to the members of HeiTech Padu Berhad
(INCORPORATED IN MALAYSIA)
REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS
In accordance with the requirements of the Companies Act 1965 in Malaysia, we also report the following:
(a) In our opinion, the accounting and other records and the registers required by the Act to be kept by the
Company and its subsidiaries of which we have acted as auditors have been properly kept in accordance
with the provisions of the Act.
(b) We have considered the financial statements and the auditors' reports of all the subsidiaries of which we
have not acted as auditors, which are indicated in Note 15 to the financial statements, being financial
statements that have been included in the consolidated financial statements.
(c) We are satisfied that the financial statements of the subsidiaries that have been consolidated with the
financial statements of the Company are in form and content appropriate and proper for the purposes of
the preparation of the consolidated financial statements and we have received satisfactory information and
explanations required by us for those purposes.
(d)The auditors’ reports on the financial statements of the subsidiaries were not subject to any qualification
and did not include any comment required to be made under Section 174(3) of the Act.
OTHER REPORTING RESPONSIBILITIES
The supplementary information set out in Note 38 on page 190 is disclosed to meet the requirement of Bursa
Malaysia Securities Berhad and is not part of the financial statements. The directors are responsible for the
preparation of the supplementary information in accordance with Guidance on Special Matter No. 1,
Determination of Realised and Unrealised Profits or Losses in the Context of Disclosure Pursuant to Bursa Malaysia
Securities Berhad Listing Requirements, as issued by the Malaysian Institute of Accountants (“MIA Guidance”)
and the directive of Bursa Malaysia Securities Berhad. In our opinion, the supplementary information is prepared,
in all material respects, in accordance with the MIA Guidance and the directive of Bursa Malaysia Securities
Berhad.
OTHER MATTERS
This report is made solely to the members of the Company, as a body, in accordance with Section 174 of the
Companies Act 1965 in Malaysia and for no other purpose. We do not assume responsibility to any other person
for the content of this report.
Hanafiah Raslan & Mohamad
AF:0002
Chartered Accountants
Kuala Lumpur, Malaysia
30 April 2014
Sandra Segaran a/l Muniandy@Krishnan
No. 2882/01/15 (J)
Chartered Accountants
page
www.heitech.com.my
109
STATEMENTS OF
COMPREHENSIVE INCOME
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2013
GroupCompany
Note2013201220132012
RM’000RM’000RM’000RM’000
Continuing operations
Revenue4
413,818395,529356,110356,504
Other income
5
9,90112,02314,35728,214
Total revenue
423,719407,552370,467384,718
Employee benefits expense
6
(96,423)(93,965)(27,164)(28,566)
Purchase of hardware and software
(63,215)(47,182)(58,691)(56,983)
Lease line rental
(68,333)(60,185)(84,175)(92,104)
Maintenance costs
(70,211)(57,606)
(102,667)(111,586)
Bulk mailing processing charges
(10,777)(9,624)
––
Project implementation costs
(53,462)(56,536)(65,869)(73,417)
Depreciation9,13
(8,797)(11,794) (6,955)(9,598)
Other expenses
(77,328)(59,036)(64,022)(5,256)
Total expenditure
(448,546)(395,928)(409,543)(377,510)
(Loss)/profit from operations
(24,827)11,624(39,076)7,208
Finance costs
8
(7,263)(5,450)(6,578)(5,246)
Share of results of associates
6521,762
––
(Loss)/profit before taxation from
continuing operations9
(31,438)7,936
(45,654)1,962
Income tax (expense)/benefit
10
(1,613)(2,527) (218)1,216
(Loss)/profit from continuing operations,
net of tax
(33,051)5,409
(45,872)3,178
Discontinued operation
Loss from discontinued operation,
net of tax
11
(298)(569)
––
(Loss)/profit for the year, net of tax (33,349)4,840
(45,872)3,178
Other comprehensive (loss)/income:
Items that may be reclassified
subsequently to profit or loss:
Available for sale investments’ fair
value movement
Transfer to profit or loss upon disposal
Foreign currency translation
–(340) –(340)
340–
340–
2,183(758) ––
Other comprehensive income/
(loss) for the year, net of tax
2,523(1,098) 340(340)
Total comprehensive (loss)/
income for the year
(30,826)3,742
(45,532)2,838
page
110
HeiTech Padu Berhad
Annual Report 2013
Statements of
comprehensive income
For the financial year ended 31 December 2013
GroupCompany
Note2013201220132012
RM’000RM’000RM’000RM’000
(Loss)/profit attributable to:
– Continuing operations
– Discontinued operation
Non-controlling interests
(32,579)4,876
(45,872)3,178
(164)(313)
––
(606)277
––
(33,349)4,840
(45,872)3,178
Total comprehensive (loss)/
income attributable to:
(30,875)3,692
(45,532)2,838
4950 ––
(30,826)3,742
(45,532)2,838
(Loss)/earnings per share attributable
to owners of the parent
(sen per share):
Basic12
(32.35)4.51
Diluted12
–4.31
Group
Note2013 2012
RM’000RM’000
(Loss)/earnings per share from
continuing operations attributable to
owners of the parent (sen per share):
Basic12
(32.18)4.82
Diluted12
–4.61
Loss per share from discontinued
operations attributable to owners
of the parent (sen per share):
Basic12
(0.16)(0.31)
Diluted12
–(0.30)
The accompanying accounting policies and explanatory notes form an integral part of the financial statements.
page
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111
STATEMENTS OF
FINANCIAL POSITION
AS AT 31 DECEMBER 2013
GroupCompany
Note2013201220132012
RM’000RM’000RM’000RM’000
Restated
Assets
Non-current assets
Property, plant and equipment
Intangible assets
Investments in subsidiaries
Investments in associates
Other investments
Lease receivable
Deferred tax assets
13
14
15
16
17
18
19
74,54975,06455,10055,439
25,60028,080 24012,860
––
42,93246,952
4,0973,445
––
6,31215,517 6,14815,353
81,94293,54681,94293,546
584584584584
193,084216,236186,946224,734
Current assets
Inventories20
1,4421,523
––
Trade and other receivables
21
154,626166,580141,443164,668
Other current assets
22
91,01052,70094,36250,971
Cash and bank balances
24
36,89273,00529,72171,075
Tax recoverable
3,2334,7892,4274,413
287,203298,597267,953291,127
Assets of disposal group classified
as held for sale
11
–13,688
––
287,203312,285267,953291,127
Total assets
480,287528,521454,899515,861
Equity and liabilities
Current liabilities
Loans and borrowings
25
Trade and other payables
26
Tax payable
84,692124,021 81,693122,674
104,18091,242
120,044100,314
1,842608 ––
190,714215,871201,737222,988
Liabilities of disposal group classified
as held for sale
11
–817 ––
190,714216,688201,737222,988
Net current assets
96,48995,59766,21668,139
Non-current liabilities
Deferred tax liabilities
19
25
1,4911,001
––
108,02694,04199,38793,566
109,51795,04299,38793,566
Total liabilities
300,231311,730301,124316,554
Net assets
180,056216,791153,775199,307
page
112
HeiTech Padu Berhad
Annual Report 2013
Statements of
financial position
As at 31 December 2013
GroupCompany
Note2013201220132012
RM’000RM’000RM’000RM’000
Restated
Equity attributable to owners
of the parent
Share capital
Share premium
Retained earnings
Other reserves
27
27
28
29
101,225101,225101,225101,225
16,52616,52616,52616,526
57,25788,78536,02480,681
66411 –875
175,672206,547153,775199,307
4,38410,244
––
Total equity
180,056216,791153,775199,307
Total equity and liabilities
480,287528,521454,899515,861
page
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113
STATEMENTS OF
CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2013
Attributable to owners of the parent
Non-distributable
Distributable
Non-distributable
Total equity
attributable
Foreign
to owners
Total
Share
currency
Fair value
Non
Totalof theShareShare
Retained other
options
translation
adjustment
controlling
equity parentcapital
premiumearningsreservesreservereservereserveInterests
(Note 27) (Note 27) (Note 28) (Note 29) (Note 29) (Note 29) (Note 29)
Group
RM’000RM’000RM’000RM’000RM’000RM’000RM’000RM’000RM’000RM’000
Opening balance at
1 January 2013
Total comprehensive
(loss)/income
Transfer to profit or loss
upon disposal
216,791206,547101,225 16,526 88,785
11 1,215
(864) (340) 10,244
(31,166)
(31,215)––
(32,743)
1,528–
1,528–
49
340
340–––
340––
340–
(30,826)
(30,875)––
(32,743)
1,868–
1,528
340
49
Transactions with owners
Acquisition of a new
subsidiary
Disposal of a subsidiary
Share options expired
(168)––––––––
(168)
(5,741)––––––––
(5,741)
––––
1,215
(1,215)
(1,215)–––
Total transactions with
owners
(5,909)–––
1,215
(1,215)
(1,215)––
(5,909)
Closing balance at
31 December 2013
180,056175,672101,225 16,526 57,257
664
Opening balance at
1 January 2012
213,369202,855101,22516,52684,222
882 1,215 (333)
Total comprehensive
income/(loss)
3,742
3,692
–
–
4,563
(871)
–
–
664
(531)
– 4,384
–10,514
(340)
50
Dividends paid to noncontrolling interests(320)––––––––
(320)
Total transactions with
owners
(320)––––––––
(320)
Closing balance at
31 December 2012 216,791206,547101,225 16,526 88,785
11 1,215
(864) (340) 10,244
page
114
HeiTech Padu Berhad
Annual Report 2013
Statements of
changes in equity
For the year ended 31 December 2013
Non-distributable
Distributable
Non-distributable
Total
Share
Fair value
TotalShareShare
Retained other
options
adjustment
equitycapital
premium
earningsreservesreservereserve
(Note 27) (Note 27) (Note 28) (Note 29) (Note 29) (Note 29)
Company
RM’000RM’000RM’000RM’000RM’000RM’000RM’000
Opening balance at 1 January 2013
199,307101,22516,52680,681
875 1,215 (340)
Total comprehensive (loss)/income
(45,872)––
(45,872)–––
340–––
340–
340
(45,532)––
(45,872)
340–
340
–––
1,215
(1,215)
(1,215)–
Total transactions with owners
–––
1,215
(1,215)
(1,215)–
Closing balance at 31 December 2013
153,775
101,225
16,526
36,024–––
Opening balance at 1 January 2012 196,469101,22516,52677,503 1,215 1,215
Total comprehensive income/(loss)
2,838
–
–
3,178
Closing balance at 31 December 2012199,307101,22516,52680,681
(340)
–
–
(340)
875 1,215 (340)
page
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115
STATEMENTS OF
CASH FLOWS
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2013
GroupCompany
Note2013201220132012
RM’000RM’000RM’000RM’000
Operating activities
(Loss)/profit before tax from continuing
operations
Loss before tax from discontinued
operation
(31,438)7,936
(45,654)1,962
(Loss)/profit before taxation, total
(31,736)7,437
(45,654)1,962
(298)(499)
––
Adjustments for:
Gain on disposal of property,
plant and equipment
5
Interest income
5
11
Dividend income
5
Loss on disposal of other investment
9
Net loss/(gain) on remeasurement
to fair value of retained interest in
a former associate
5,9
Net gain on disposal of investment
in a subsidiary
5
Finance costs
8
11
Depreciation
9
9
Reversal of impairment loss on:
– Trade receivables
9
– Other receivables
9
Impairment loss on:
– Trade receivables
9
– Other receivables
9
– Intangible assets
9
– Available-for-sale financial assets
9
Amortisation of intangible assets
9
Loss on disposal of subsidiaries
9
11
Total adjustments
(97)(49)(49)(49)
(474)(718)(423)(625)
–(6)––
(3,585)(2,528)(3,585)(11,458)
33925
33925
–2,140
–(335)
–––(403)
7,2635,4506,5785,246
44––
8,79711,794 6,9559,598
1120 ––
(1,298)(4,617)(1,297)(4,298)
(100)(1,536) (100)(1,536)
5,9694,6732,1954,183
7,963204
7,644204
–3,427
––
1,878809
1,878809
87102 8788
2,072–
3,020–
(652)(1,762)
–747
––
––
28,17718,17923,2421,449
page
116
HeiTech Padu Berhad
Annual Report 2013
Statements of
cash flows
For the financial year ended 31 December 2013
GroupCompany
Note2013201220132012
RM’000RM’000RM’000RM’000
Operating (loss)/profit before
working capital changes
(3,559)25,616(22,412)3,411
Changes in working capital
Increase in inventories
Decrease/(increase) in trade and
other receivables
(Increase)/decrease in other current
assets
Increase in payables trade and other
payables
377(1,088)
––
26,345(13,958)31,095(10,923)
(23,056)19,806(28,137)24,781
7,74710,63019,73016,596
Total changes in working capital
11,41315,39022,68830,454
Cash from/(used in) operations
7,85441,006 27633,865
Interest paid
(7,267)(5,454)(6,578)(5,246)
Taxes paid
(138)(3,866)
–(2,971)
Net cash (used in)/from operating
activities
44931,686(6,302)25,648
Investing activities
Purchase of property, plant and
equipment
13
Interest received
Net dividends received
Proceeds from disposal of property,
plant and equipment
Proceeds from disposal of an investment
Proceeds from disposal of an associate
Proceeds from disposal of subsidiaries
Software and deferred development
costs incurred
Net cash outflow on acquisition of
subsidiaries
Purchase of investments
(7,340)(6,166)(6,616)(1,961)
474724423625
1,3452,5281,3453,008
125594953
7,328–
7,328–
–6,450
–6,450
244–
3004,000
(6,151)–
(2,721)–
(7,984)– ––
–(1,022)
–(1,022)
Net cash (used in)/from investing
activities
(11,959)2,573
10811,153
page
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117
GroupCompany
Note2013201220132012
RM’000RM’000RM’000RM’000
Financing activities
Net repayments of loans and borrowings
Net repayments of obligations under
finance leases
Dividends paid to non-controlling interests
(29,444)(31,170)(35,555)(31,047)
(3,893)(2,703)(3,606)(990)
–(320) ––
Net cash used in financing activities (33,337)(34,193)(39,161)(32,037)
Net (decrease)/increase in cash and
cash equivalents
(44,847)66
(45,355)4,764
Effect of exchange rate changes on cash
and cash equivalents
3,387(42) ––
Cash and cash equivalents at 1 January
40,49940,47538,46833,704
Cash and cash equivalents at
31 December
24
(961)40,499 (6,887)38,468
page
HeiTech Padu Berhad
118
Annual Report 2013
NOTES TO THE
FINANCIAL STATEMENTS
– 31 DECEMBER 2013
1. CORPORATE INFORMATION
The Company is a public limited liability company, incorporated and domiciled in Malaysia, and is listed on
Bursa Malaysia Securities Berhad. The registered office and the principal place of business of the Company
is located at Level 15, HeiTech Village, Persiaran Kewajipan, USJ 1, UEP Subang Jaya, 47600 Selangor Darul
Ehsan.
The principal activities of the Company are the provision of systems integration, network related services,
data centre management, disaster recovery services and other information technology related services.
Under the Communications and Multimedia Act (CMA) 1998 Framework, the provision of network related
services and internet data centre services are licensed as Network Services Provider Individual License (NSP
(i)) and Application Service Provider Class License (ASP (c)) respectively.
The principal activities of the subsidiaries are described in Note 15 to the financial statements.
There have been no significant changes in the nature of these activities during the financial year.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
2.1
Basis of preparation
The financial statements of the Group and of the Company have been prepared in accordance with
Malaysian Financial Reporting Standards (“MFRS”), International Financial Reporting Standards (“IFRS”)
and the requirements of the Companies Act 1965 in Malaysia.
The financial statements have been prepared on a historical cost basis except as disclosed in the
accounting policies below.
The financial statements are presented in Ringgit Malaysia (“RM”) and all values are rounded to the
nearest thousand (RM’000) except when otherwise indicated.
2.2
Changes in accounting policies
The accounting policies adopted are consistent with those of the previous financial financial year
except as follows:
On 1 January 2013, the Group and the Company adopted the following new and amended MFRS
and IC Interpretation mandatory for annual financial periods beginning on or after 1 July 2013 and
1 January 2013.
page
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119
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT’D.)
2.2
Changes in accounting policies (cont’d.)
Description
Effective for annual periods
beginning on or after
Amendments to MFRS 101: Presentation of Items of Other
Comprehensive Income
MFRS 3: Business Combinations (IFRS 3 Business Combinations
issued by IASB in March 2004)
MFRS 127: Consolidated and Separate Financial Statements
(IAS 27 revised by IASB in December 2003)
MFRS 10: Consolidated Financial Statements
MFRS 11: Joint Arrangements
MFRS 12: Disclosure of Interests in Other Entities
MFRS 13: Fair Value Measurement
MFRS 119: Employee Benefits (IAS 19 as amended by IASB in
June 2011)
MFRS 127: Separate Financial Statements (IAS 27 as amended
by IASB in May 2011)
MFRS 128: Investment in Associate and Joint Ventures
(IAS 28 as amended by IASB in May 2011)
IC Interpretation 20: Stripping Costs in the Production Phase
of a Surface Mine
Amendments to MFRS 7: Disclosures – Offsetting Financial Assets
and Financial Liabilities
Annual Improvements 2009-2011 Cycle
Amendments to MFRS 1: Government Loans
Amendments to MFRS 10, MFRS 11 and MFRS 12:
Consolidated Financial Statements, Joint Arrangements
and Disclosure of Interests in Other Entities: Transition Guidance
Adoption of the above amendments, standards and interpretation did not have any effect on the
financial performance or position of the Group and the Company except for those discussed below:
MFRS 10: Consolidated Financial Statements
MFRS 10 replaces part of MFRS 127 Consolidated and Separate Financial Statements that deals with
consolidated financial statements and IC Interpretation 112: Consolidation – Special Purpose Entities.
Under MFRS 10, an investor controls an investee when (a) the investor has power over an investee,
(b) the investor has exposure, or rights, to variable returns from its investment with the investee, and
(c) the investor has ability to use its power over the investee to affect the amount of the investor’s
returns. Under MFRS 127: Consolidated and Separate Financial Statements, control was defined as the
power to govern the financial and operating policies of an entity so as to obtain benefits from its
activities.
MFRS 10 includes detailed guidance to explain when an investor that owns less than 50 per cent of
the voting shares in an investee has control over the investee. MFRS 10 requires the investor to take
into account all relevant facts and circumstances, particularly the size of the investor’s holding of
voting rights relative to the size and dispersion of holdings of the other vote holders. The adoption of
MFRS 10 has no impact on the Group’s financial position or performance.
1 July 2012
1 January 2013
1
1
1
1
1
January
January
January
January
January
2013
2013
2013
2013
2013
1 January 2013
1 January 2013
1 January 2013
1 January 2013
1 January 2013
1 January 2013
1 January 2013
1 January 2013
page
HeiTech Padu Berhad
120
Annual Report 2013
Notes to the
financial statements
– 31 December 2013
2.2
MFRS 11: Joint Arrangements
MFRS 11 replaces MFRS 131: Interests in Joint Ventures and IC Interpretation 113: Jointly-Controlled
Entities – Non-monetary Contributions by Venturers.
The classification of joint arrangements under MFRS 11 is determined based on the rights and
obligations of the parties to the joint arrangements by considering the structure, the legal form, the
contractual terms agreed by the parties to the arrangement and when relevant, other facts and
circumstances. Under MFRS 11, joint arrangements are classified as either joint operations or joint
ventures.
The classification of joint arrangements under MFRS 11 is determined based on the rights and
obligations of the parties to the joint arrangements by considering the structure, the legal form, the
contractual terms agreed by the parties to the arrangement and when relevant, other facts and
circumstances. Under MFRS 11, joint arrangements are classified as either joint operations or joint
ventures.
A joint operation is a joint arrangement whereby the parties that have joint control of the arrangement
have rights to the assets, and obligations for the liabilities, relating to the arrangement. A joint venture
is a joint arrangement whereby the parties that have joint control of the arrangement have rights to
the net assets of the arrangement.
MFRS 11 removes the option to account for jointly controlled entities (“JCE”) using proportionate
consolidation. Instead, JCE that meet the definition of a joint venture must be accounted for using
the equity method.
MFRS 11 has been applied in accordance with the relevant transitional provisions set out in MFRS 11.
The initial investment as at 1 January 2012 for the purposes of applying the equity method is
measured as the aggregate of the carrying amounts of the assets and liabilities that the Group had
previously proportionately consolidated.
MFRS 12: Disclosures of Interests in Other Entities
MFRS 12 includes all disclosure requirements for interests in subsidiaries, joint arrangements, associates
and structured entities. A number of new disclosures are required. This standard affects disclosures
only and has no impact on the Group’s financial position or performance.
MFRS 13: Fair Value Measurement
MFRS 13 establishes a single source of guidance under MFRS for all fair value measurements. MFRS
13 does not change when an entity is required to use fair value, but rather provides guidance on
how to measure fair value under MFRS. MFRS 13 defines fair value as an exit price. As a result of the
guidance in MFRS 13, the Group re-assessed its policies for measuring fair values, in particular, its
valuation inputs such as non-performance risk for fair value measurement of liabilities. MFRS 13 also
requires additional disclosures.
Application of MFRS 13 has not materiality impacted the fair value measurement of the Group.
Additional disclosures where required, are provided in the individual notes relating to the assets and
liabilities whose fair values were determined.
page
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121
2.2
Amendments to MFRS 101: Presentation of Items of Other Comprehensive Income
The amendments to MFRS 101 introduce a grouping of items presented in other comprehensive
income. Items that will be reclassified (“recycled”) to profit or loss at a future point in time (eg. net
loss or gain on available-for-sale financial assets) have to be presented separately from items that will
not be reclassified (eg. revaluation of land and buildings). The amendments affect presentation only
and have no impact on the Group’s financial position or performance.
MFRS 127: Separate Financial Statements
As a consequence of the new MFRS 10 and MFRS 12, MFRS 127 is limited to accounting for subsidiaries,
jointly controlled entities and associates in separate financial statements.
MFRS 128: Investments in Associates and Joint Ventures
As a consequence of the new MFRS 11 and MFRS 12, MFRS 128 is renamed as MFRS 128: Investments
in Associates and Joint Ventures. This new standard describes the application of the equity method
to investments in joint ventures in addition to associates.
2.3
Standards issued but not yet effective
The amendments, standards and interpretation that are issued but not yet effective up to the date of
issuance of the Group’s and the Company’s financial statements are disclosed below. The Group and
the Company intend to adopt these standards, if applicable, when they become effective.
Description
Amendments to MFRS 132: Offsetting Financial Assets
and Financial Liabilities
Amendments to MFRS 10, MFRS 12 and MFRS 127: Investment Entities
Amendments to MFRS 136: Recoverable Amount
Disclosures for Non-Financial Assets
Amendments to MFRS 139: Novation of Derivatives and Continuation
of Hedge Accounting
IC Interpretation 21: Levies
Amendments to MFRS 119: Defined Benefit Plans:
Employee Contributions
Annual Improvements to MFRSs 2010–2012 Cycle
Annual Improvements to MFRSs 2011–2013 Cycle
MFRS 9: Financial Instruments (IFRS 9 issued by IASB in
November 2009)
MFRS 9: Financial Instruments (IFRS 9 issued by IASB in October 2010)
MFRS 9: Financial Instruments: Hedge Accounting and amendments
to MFRS 9, MFRS 7 and MFRS 139
Effective for annual periods
beginning on or after
1 January 2014
1 January 2014
1 January 2014
1 January 2014
1 January 2014
1 July 2014
1 July 2014
1 July 2014
To be announced
To be announced
To be announced
page
HeiTech Padu Berhad
122
Annual Report 2013
Notes to the
2.3
Standards issued but not yet effective (cont’d.)
The directors expect that the adoption of the above amendments, standards and interpretation will
have no material impact on the financial statements in the period of initial application except as
discussed below:
MFRS 9: Financial Instruments
MFRS 9 reflects the first phase of work on the replacement of MFRS 139 and applies to classification
and measurement of financial assets and financial liabilities as defined in MFRS 139. The standard
was initially effective for annual periods beginning on or after 1 January 2013, but Amendments to
MFRS 9: Mandatory Effective Date of MFRS 9 and Transition Disclosures, issued in March 2012, moved
the mandatory effective date to 1 January 2015. Subsequently, on 14 February 2014, it was announced
that the new effective date will be decided when the project is closer to completion. The adoption
of the first phase of MFRS 9 will have an effect on the classification and measurement of the Group’s
financial assets, but will not have an impact on classification and measurements of the Group’s
financial liabilities. The Group will quantify the effect in conjunction with the other phases, when the
final standard including all phases is issued.
Amendments to MFRS 139: Novation of Derivatives and Continuation of Hedge Accounting
These amendments provide relief from discontinuing hedge accounting when novation of a derivative
designated as a hedging instrument meets certain criteria. The Group has not novated its derivatives
during the current period. However, these amendments would be considered for future novation.
2.4
Basis of consolidation
The consolidated financial statements comprise the financial statements of the Company and its
subsidiaries as at the reporting date. The financial statements of the subsidiaries used in the
preparation of the consolidated financial statements are prepared for the same reporting date as the
Company. Consistent accounting policies are applied to like transactions and events in similar
circumstances.
The Company controls an investee if and only if the Company has all the following:
(i) Power over the investee (i.e existing rights that give it the current ability to direct the relevant
activities of the investee);
(ii) Exposure, or rights, to variable returns from its investment with the investee; and
(iii) The ability to use its power over the investee to affect its returns.
When the Company has less than a majority of the voting rights of an investee, the Company
considers the following in assessing whether or not the Company’s voting rights in an investee are
sufficient to give it power over the investee:
(i) The size of the Company’s holding of voting rights relative to the size and dispersion of holdings
of the other vote holders;
(ii) Potential voting rights held by the Company, other vote holders or other parties;
(iii) Rights arising from other contractual arrangements; and
(iv) Any additional facts and circumstances that indicate that the Company has, or does not have,
the current ability to direct the relevant activities at the time that decisions need to be made,
including voting patterns at previous shareholders’ meetings.
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123
2.4
Basis of consolidation (cont’d.)
Subsidiaries are consolidated when the Company obtains control over the subsidiary and ceases
when the Company loses control of the subsidiary. All intra-group balances, income and expenses
and unrealised gains and losses resulting from intra-group transactions are eliminated in full.
Losses within a subsidiary are attributed to the non-controlling interests even if that results in a deficit
balance.
Changes in the Group’s ownership interests in subsidiaries that do not result in the Group losing
control over the subsidiaries are accounted for as equity transactions. The carrying amounts of the
Group’s interests and the non-controlling interests are adjusted to reflect the changes in their relative
interests in the subsidiaries. The resulting difference is recognised directly in equity and attributed to
owners of the Company.
When the Group loses control of a subsidiary, a gain or loss calculated as the difference between (i)
the aggregate of the fair value of the consideration received and the fair value of any retained
interest and (ii) the previous carrying amount of the assets and liabilities of the subsidiary and any
non-controlling interest, is recognised in profit or loss. The subsidiary’s cumulative gain or loss which
has been recognised in other comprehensive income and accumulated in equity are reclassified to
profit or loss or where applicable, transferred directly to retained earnings. The fair value of any
investment retained in the former subsidiary at the date control is lost is regarded as the cost on initial
recognition of the investment.
Business combinations
Acquisitions of subsidiaries are accounted for using the acquisition method. The cost of an acquisition
is measured as the aggregate of the consideration transferred, measured at acquisition date fair
value and the amount of any non-controlling interests in the acquiree. The Group elects on a
transaction-by-transaction basis whether to measure the non-controlling interests in the acquiree either
at fair value or at the proportionate share of the acquiree’s identifiable net assets. Transaction costs
incurred are expensed and included in administrative expenses.
Any contingent consideration to be transferred by the acquirer will be recognised at fair value at the
acquisition date. Subsequent changes in the fair value of the contingent consideration which is
deemed to be an asset or liability, will be recognised in accordance with MFRS 139 either in profit or
loss or as a change to other comprehensive income. If the contingent consideration is classified as
equity, it will not be remeasured. Subsequent settlement is accounted for within equity. In instances
where the contingent consideration does not fall within the scope of MFRS 139, it is measured in
accordance with the appropriate MFRS.
When the Group acquires a business, it assesses the financial assets and liabilities assumed for
appropriate classification and designation in accordance with the contractual terms, economic
circumstances and pertinent conditions as at the acquisition date. This includes the separation of
embedded derivatives in host contracts by the acquiree.
If the business combination is achieved in stages, the acquisition date fair value of the acquirer’s
previously held equity interest in the acquiree is remeasured to fair value at the acquisition date
through profit or loss.
Goodwill is initially measured at cost, being the excess of the aggregate of the consideration
transferred and the amount recognised for non-controlling interests over the net identifiable assets
acquired and liabilities assumed. If this consideration is lower than fair value of the net assets of the
subsidiary acquired, the difference is recognised in profit or loss. The accounting policy for goodwill
is set out in Note 2.8.
page
HeiTech Padu Berhad
124
Annual Report 2013
Notes to the
2.5
Transactions with non-controlling interests
Non-controlling interest represents the equity in subsidiaries not attributable, directly or indirectly, to
owners of the Company, and is presented separately in the consolidated statement of comprehensive
income and within equity in the consolidated statement of financial position, separately from equity
attributable to owners of the Company.
Changes in the Company owners’ ownership interest in a subsidiary that do not result in a loss of
control are accounted for as equity transactions. In such circumstances, the carrying amounts of the
controlling and non-controlling interests are adjusted to reflect the changes in their relative interests
in the subsidiary. Any difference between the amount by which the non-controlling interest is adjusted
and the fair value of the consideration paid or received is recognised directly in equity and attributed
to owners of the parent.
2.6
Foreign currency
(a)Functional and presentation currency
The individual financial statements of each entity in the Group are measured using the currency
of the primary economic environment in which the entity operates (“the functional currency”).
The consolidated financial statements are presented in Ringgit Malaysia (“RM”), which is also the
Company’s functional currency.
(b)Foreign currency transactions
Transactions in foreign currencies are measured in the respective functional currencies of the
Company and its subsidiaries and are recorded on initial recognition in the functional currencies
at exchange rates approximating those ruling at the transaction dates. Monetary assets and
liabilities denominated in foreign currencies are translated at the rate of exchange ruling at the
reporting date. Non-monetary items denominated in foreign currencies that are measured at
historical cost are translated using the exchange rates as at the dates of the initial transactions.
Non-monetary items denominated in foreign currencies measured at fair value are translated
using the exchange rates at the date when the fair value was determined.
Exchange differences arising on the settlement of monetary items or on translating monetary
items at the reporting date are recognised in profit or loss except for exchange differences arising
on monetary items that form part of the Group’s net investment in foreign operations, which are
recognised initially in other comprehensive income and accumulated under foreign currency
translation reserve in equity. The foreign currency translation reserve is reclassified from equity to
profit or loss of the Group on disposal of the foreign operation.
Exchange differences arising on the translation of non-monetary items carried at fair value are
included in profit or loss for the period except for the differences arising on the 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.
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2.6
Foreign currency (cont’d.)
(c) Foreign operations
The assets and liabilities of foreign operations are translated into RM at the rate of exchange
ruling at the reporting date and income and expenses are translated at exchange rates at the
dates of the transactions. The exchange differences arising on the translation are taken directly
to other comprehensive income. On disposal of a foreign operation, the cumulative amount
recognised in other comprehensive income and accumulated in equity under foreign currency
translation reserve relating to that particular foreign operation is recognised in the profit or loss.
Goodwill and fair value adjustments arising on the acquisition of foreign operations are treated
as assets and liabilities of the foreign operations and are recorded in the functional currency of
the foreign operations and translated at the closing rate at the reporting date.
2.7
All items of property, plant and equipment are initially recorded at cost. The cost of an item of
property, plant and equipment is recognised as an asset if, and only if, it is probable that future
economic benefits associated with the item will flow to the Group and the cost of the item can be
measured reliably.
Subsequent to recognition, property, plant and equipment are measured at cost less accumulated
depreciation and accumulated impairment losses. When significant parts of plant and equipment are
required to be replaced in intervals, the Group recognises such parts as individual assets with specific
useful lives and depreciation, respectively. Likewise, when a major inspection is performed, its cost is
recognised in the carrying amount of the plant and equipment as a replacement if the recognition
criteria are satisfied. All other repair and maintenance costs are recognised in profit or loss as
incurred.
Freehold land has an unlimited useful life and therefore is not depreciated. Construction work in
progress is not depreciated as the asset is not yet ready for its intended purposes. Depreciation is
computed on a straight-line basis over the estimated useful lives of the assets at the following annual
rates:
Building
Motor vehicles
Office equipment, furniture and fittings
Computers and network equipment
Renovation
Machinery
2%
20%
10% – 20%
25% – 331⁄3%
15%
6% – 13%
The carrying values of property, plant and equipment are reviewed for impairment when events or
changes in circumstances indicate that the carrying value may not be recoverable.
The residual value, useful life and depreciation method are reviewed at each financial year-end, and
adjusted prospectively, if appropriate.
An item of property, plant and equipment is derecognised upon disposal or when no future economic
benefits are expected from its use or disposal. Any gain or loss on derecognition of the asset is
included in the profit or loss in the year the asset is derecognised.
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Notes to the
2.8
Intangible assets
(a)Goodwill
Goodwill is initially measured at cost. Following initial recognition, goodwill is measured at cost
less accumulated impairment losses.
For the purpose of impairment testing, goodwill acquired is allocated, from the acquisition date,
to each of the Group’s cash-generating units that are expected to benefit from the synergies of
the combination.
The cash-generating unit to which goodwill has been allocated is tested for impairment annually
and whenever there is an indication that the cash-generating unit may be impaired, by
comparing the carrying amount of the cash-generating unit, including the allocated goodwill,
with the recoverable amount of the cash-generating unit. Where the recoverable amount of the
cash-generating unit is less than the carrying amount, an impairment loss is recognised in the
profit or loss. Impairment losses recognised for goodwill are not reversed in subsequent periods.
Where goodwill forms part of a cash-generating unit and part of the operation within that cashgenerating unit is disposed of, the goodwill associated with the operation disposed of is included
in the carrying amount of the operation when determining the gain or loss on disposal of the
operation. Goodwill disposed of in this circumstance is measured based on the relative fair values
of the operations disposed of and the portion of the cash-generating unit retained.
Goodwill and fair value adjustments arising on the acquisition of foreign operations on or after 1
January 2006 are treated as assets and liabilities of the foreign operations and are recorded in
the functional currency of the foreign operations and translated in accordance with the
accounting policy set out in Note 2.6.
Goodwill and fair value adjustments which arose on acquisitions of foreign operations before 1
January 2006 are deemed to be assets and liabilities of the Company and are recorded in RM
at the rates prevailing at the date of acquisition.
(b)Other intangible assets
Intangible assets acquired separately are measured initially at cost. The cost of intangible assets
acquired in a business combination is their fair value as at the date of acquisition. Following initial
acquisition, intangible assets are measured at cost less any accumulated amortisation and
accumulated impairment losses.
Intangible assets with finite useful lives are amortised over the estimated useful lives and assessed
for impairment whenever there is an indication that the intangible asset may be impaired. The
amortisation period and the amortisation method are reviewed at least at each financial yearend. Changes in the expected useful life or the expected pattern of consumption of future
economic benefits embodied in the asset is accounted for by changing the amortisation period
or method, as appropriate, and are treated as changes in accounting estimates. The amortisation
expense on intangible assets with finite lives is recognised in profit or loss.
Gains or losses arising from derecognition of an intangible asset are measured as the difference
between the net disposal proceeds and the carrying amount of the asset and are recognised in
profit or loss when the asset is derecognised.
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2.8
Intangible assets (cont’d.)
(b)Other intangible assets (cont’d.)
Research and development costs
Research costs are expensed as incurred. Development costs arising from development
expenditures on an individual project are recognised when the Group can demonstrate the
technical feasibility of completing the intangible asset so that it will be available for use or sale,
its intention to complete and its ability to use or sell the asset, how the asset will generate future
economic benefits, the availability of resources to complete and the ability to measure reliably
the expenditures during development. Development costs have a finite useful life and are
amortised over the period of expected sales from the related project on a straight line basis.
2.9
Impairment of non-financial assets
The Group assesses at each reporting date whether there is an indication that an asset may be
impaired. If any such indication exists, or when an annual impairment assessment for an asset is
required, the Group makes an estimate of the asset’s recoverable amount.
An asset’s recoverable amount is the higher of its fair value less costs to sell and its value in use. For
the purpose of assessing impairment, assets are grouped at the lowest levels for which there are
separately identifiable cash flows (cash-generating units (“CGU”)).
In assessing value in use, the estimated future cash flows expected to be generated by the asset are
discounted to their present value using a pre-tax discount rate that reflects current market assessments
of the time value of money and the risks specific to the asset. Where the carrying amount of an asset
exceeds its recoverable amount, the asset is written down to its recoverable amount. Impairment
losses recognised in respect of a CGU or groups of CGUs are allocated first to reduce the carrying
amount of any goodwill allocated to those units or groups of units and then, to reduce the carrying
amount of the other assets in the unit or groups of units on a pro-rata basis.
Impairment losses are recognised in profit or loss.
An assessment is made at each reporting date as to whether there is any indication that previously
recognised impairment losses may no longer exist or may have decreased. A previously recognised
impairment loss is reversed only if there has been a change in the estimates used to determine the
asset’s recoverable amount since the last impairment loss was recognised. If that is the case, the
carrying amount of the asset is increased to its recoverable amount. That increase cannot exceed
the carrying amount that would have been determined, net of depreciation, had no impairment loss
been recognised previously. Such reversal is recognised in profit or loss.
2.10Subsidiaries
A subsidiary is an entity over which the Group has all the following:
(i) Power over the investee (i.e existing rights that give it the current ability to direct the relevant
activities of the investee);
(ii) Exposure, or rights, to variable returns from its investment with the investee; and
(iii) The ability to use its power over the investee to affect its returns.
In the Company’s separate financial statements, investments in subsidiaries are accounted for at cost
less impairment losses. On disposal of such investments, the difference between net disposal proceeds
and their carrying amounts is included in profit or loss.
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Notes to the
2.11 Investments in associates
An associate is an entity in which the Group has significant influence. Significant influence is the
power to participate in the financial and operating policy decisions of the investee but is not control
or joint control over those policies.
On acquisition of an investment in associate, any excess of the cost of investment over the Group’s
share of the net fair value of the identifiable assets and liabilities of the investee is recognised as
goodwill and included in the carrying amount of the investment. Any excess of the Group’s share of
the net fair value of the identifiable assets and liabilities of the investee over the cost of investment is
excluded from the carrying amount of the investment and is instead included as income in the
determination of the Group’s share of the associate’s profit or loss for the period in which the
investment is acquired.
An associate is equity accounted for from the date on which the investee becomes an associate.
Under the equity method, on initial recognition the investment in an associate is recognised at cost,
and the carrying amount is increased or decreased to recognise the Group’s share of the profit or
loss and other comprehensive income of the associate after the date of acquisition. When the
Group’s share of losses in an associate equal or exceeds its interest in the associate, the Group does
not recognise further losses, unless it has incurred legal or constructive obligations or made payments
on behalf of the associate.
Profits and losses resulting from upstream and downstream transactions between the Group and its
associate are recognised in the Group’s financial statements only to the extent of unrelated investors’
interests in the associate. Unrealised losses are eliminated unless the transaction provides evidence of
an impairment of the asset transferred.
The financial statements of the associates are prepared as of the same reporting date as the
Company. Where necessary, adjustments are made to bring the accounting policies in line with those
of the Group.
After application of the equity method, the Group applies MFRS 139: Financial Instruments: Recognition
and Measurement to determine whether it is necessary to recognise any additional impairment loss
with respect to its net investment in the associate. When necessary, the entire carrying amount of the
investment is tested for impairment in accordance with MFRS 136 Impairment of Assets as a single
asset, by comparing its recoverable amount (higher of value in use and fair value less costs to sell)
with its carrying amount. Any impairment loss is recognised in profit or loss. Reversal of an impairment
loss is recognised to the extent that the recoverable amount of the investment subsequently increases.
In the Company’s separate financial statements, investments in associates are accounted for at cost
less impairment losses. On disposal of such investments, the difference between net disposal proceeds
and their carrying amounts is included in profit or loss.
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2.12 Financial assets
Financial assets are recognised in the statements of financial position when, and only when, the
Group and the Company become a party to the contractual provisions of the financial instruments.
When financial assets are recognised initially, they are measured at fair value, plus, in the case of
financial assets not at fair value through profit or loss, directly attributable transaction costs.
The Group and the Company determine the classification of their financial assets at initial recognition,
and the categories include financial assets at fair value through profit or loss, loans and receivables,
held-to-maturity investments and available-for-sale financial assets.
(a)Financial assets at fair value through profit or loss
Financial assets are classified as financial assets at fair value through profit or loss if they are held
for trading or are designated as such upon initial recognition. Financial assets held for trading
are derivatives (including separated embedded derivatives) or financial assets acquired
principally for the purpose of selling in the near term.
Subsequent to initial recognition, financial assets at fair value through profit or loss are measured
at fair value. Any gains or losses arising from changes in fair value recognised in profit or loss.
Net gains or net losses on financial assets at fair value through profit or loss do not include
exchange differences, interest and dividend income. Exchange differences, interest and dividend
income on financial assets at fair value through profit or loss as part of other losses or other
income.
Financial assets at fair value through profit or loss could be presented as current or non-current.
Financial assets that is held primarily for trading purposes are presented as current whereas
financial assets that is not held primarily for trading purposes are presented as current or noncurrent based on the settlement date.
The Group and the Company did not have any financial assets at fair value through profit or loss
during the year ended 31 December 2013.
(b)Loans and receivables
Financial assets with fixed or determinable payments that are not quoted in an active market are
classified as loans and receivables.
Subsequent to initial recognition, loans and receivables are measured at amortised cost using
the effective interest method. Gains and losses are recognised in profit or loss when the loans
and receivables are derecognised or impaired, and through the amortisation process.
Loans and receivables are classified as current assets, except for those having maturity dates
later than 12 months after the reporting date which are classified as non-current.
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Notes to the
2.12 Financial assets (cont’d.)
(c) Held-to-maturity investments
Financial assets with fixed or determinable payments and fixed maturity are classified as held-tomaturity when the Group has the positive intention and ability to hold the investment to maturity.
Subsequent to initial recognition, held-to-maturity investments are measured at amortised cost
using the effective interest method. Gains and losses are recognised in profit or loss when the
held-to-maturity investments are derecognised or impaired, and through the amortisation process.
Held-to-maturity investments are classified as non-current assets, except for those having maturity
within 12 months after the reporting date which are classified as current.
The Group and the Company did not have any held-to-maturity investments during the year
ended 31 December 2013.
(d)Available-for-sale financial assets
Available-for-sale financial assets are financial assets that are designated as available for sale or
are not classified in any of the three preceding categories.
After initial recognition, available-for-sale financial assets are measured at fair value. Any gains or
losses from changes in fair value of the financial assets are recognised in other comprehensive
income, except that impairment losses, foreign exchange gains and losses on monetary
instruments and interest calculated using the effective interest method are recognised in profit or
loss. The cumulative gain or loss previously recognised in other comprehensive income is
reclassified from equity to profit or loss as a reclassification adjustment when the financial asset
is derecognised. Interest income calculated using the effective interest method is recognised in
profit or loss. Dividends on an available-for-sale equity instrument are recognised in profit or loss
when the Group and the Company’s right to receive payment is established.
Investment in equity instruments whose fair value cannot be reliably measured is measured at
cost less impairment loss.
Available-for-sale financial assets are classified as non-current assets unless they are expected to
be realised within 12 months after the reporting date.
A financial asset is derecognised where the contractual right to receive cash flows from the asset has
expired. On derecognition of a financial asset in its entirety, the difference between the carrying
amount and the sum of the consideration received and any cumulative gain or loss that had been
recognised in other comprehensive income is recognised in profit or loss.
Regular way of purchases or sales are purchases or sales of financial assets that require delivery of
assets within the period generally established by regulation or convention in the marketplace
concerned. All regular way purchases and sales of financial assets are recognised or derecognised
on the trade date i.e., the date that the Group and the Company commit to purchase or sell the
asset.
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2.13 Impairment of financial assets
The Group and the Company assess at each reporting date whether there is any objective evidence
that a financial asset is impaired.
(a)Trade and other receivables and other financial assets carried at amortised cost
To determine whether there is objective evidence that an impairment loss on financial assets has
been incurred, the Group and the Company consider factors such as the probability of insolvency
or significant financial difficulties of the debtor and default or significant delay in payments. For
certain categories of financial assets, such as trade receivables, assets that are assessed not to
be impaired individually are subsequently assessed for impairment on a collective basis based
on similar risk characteristics. Objective evidence of impairment for a portfolio of receivables
could include the Group’s and the Company’s past experience of collecting payments, an
increase in the number of delayed payments in the portfolio past the average credit period and
observable changes in national or local economic conditions that correlate with default on
receivables.
If any such evidence exists, the amount of impairment loss is measured as the difference between
the asset’s carrying amount and the present value of estimated future cash flows discounted at
the financial asset’s original effective interest rate. The impairment loss is recognised in profit or
loss.
The carrying amount of the financial asset is reduced by the impairment loss directly for all
financial assets with the exception of trade receivables, where the carrying amount is reduced
through the use of an allowance account. When a trade receivable becomes uncollectible, it is
written off against the allowance account.
If in a subsequent period, the amount of the impairment loss decreases and the decrease can
be related objectively to an event occurring after the impairment was recognised, the previously
recognised impairment loss is reversed to the extent that the carrying amount of the asset does
not exceed its amortised cost at the reversal date. The amount of reversal is recognised in profit
or loss.
(b)Unquoted equity securities carried at cost
If there is objective evidence (such as significant adverse changes in the business environment
where the issuer operates, probability of insolvency or significant financial difficulties of the issuer)
that an impairment loss on financial assets carried at cost has been incurred, the amount of the
loss is measured as the difference between the asset’s carrying amount and the present value
of estimated future cash flows discounted at the current market rate of return for a similar
financial asset. Such impairment losses are not reversed in subsequent periods.
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Notes to the
2.13 Impairment of financial assets (cont’d.)
(c) Available-for-sale financial assets
Significant or prolonged decline in fair value below cost, significant financial difficulties of the
issuer or obligor, and the disappearance of an active trading market are considerations to
determine whether there is objective evidence that investment securities classified as availablefor-sale financial assets are impaired.
If an available-for-sale financial asset is impaired, an amount comprising the difference between
its cost (net of any principal payment and amortisation) and its current fair value, less any
impairment loss previously recognised in profit or loss, is transferred from equity to profit or loss.
Impairment losses on available-for-sale equity investments are not reversed in profit or loss in the
subsequent periods. Increase in fair value, if any, subsequent to impairment loss is recognised in
other comprehensive income. For available-for-sale debt investments, impairment losses are
subsequently reversed in profit or loss if an increase in the fair value of the investment can be
objectively related to an event occurring after the recognition of the impairment loss in profit or
loss.
2.14 Cash and cash equivalents
Cash and cash equivalents comprise cash at banks and in hand, demand deposits, and short term,
highly liquid investments that are readily convertible to known amount of cash and which are subject
to an insignificant risk of changes in value. These also include bank overdrafts that form an integral
part of the Group’s cash management, if any.
2.15Inventories
Inventories comprising consumables are stated at the lower of cost and net realisable value.
Costs incurred in bringing the inventories to their present location and condition are accounted for
on a first-in first-out basis.
Net realisable value is the estimated selling price in the ordinary course of business less the estimated
costs necessary to make the sales.
2.16 Due from/(to) customers on contracts
Where the outcome of a contract can be reliably estimated, contract revenue and contract costs are
recognised as revenue and expenses respectively by using the stage of completion method. The
stage of completion is measured by reference to the proportion of contract costs incurred for work
performed to date to the estimated total contract costs.
Where the outcome of a contract cannot be estimated reliably, contract revenue is recognised to the
extent of contract costs incurred that are likely to be recoverable. Contract costs are recognised as
expense in the period in which they are incurred.
When it is probable that total contract costs will exceed total contract revenue, the expected loss is
recognised as an expense immediately.
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2.16 Due from/(to) customers on contracts (cont’d.)
Contract revenue comprises the initial amount of revenue agreed in the contract and variations in
contract work, claims and incentive payments to the extent that it is probable that they will result in
revenue and they are capable of being reliably measured.
When the total of costs incurred on contracts plus recognised profits (less recognised losses) exceeds
progress billings, the balance is classified as amount due from customers on contracts. When progress
billings exceed costs incurred plus, recognised profits (less recognised losses), the balance is classified
as amount due to customers on contracts.
2.17Provisions
Provisions are recognised when the Group has a present obligation (legal or constructive) as a result
of a past event, it is probable that an outflow of economic resources will be required to settle the
obligation and the amount of the obligation can be estimated reliably.
Provisions are reviewed at each reporting date and adjusted to reflect the current best estimate. If it
is no longer probable that an outflow of economic resources will be required to settle the obligation,
the provision is reversed. If the effect of the time value of money is material, provisions are discounted
using a current pre tax rate that reflects, where appropriate, the risks specific to the liability. When
discounting is used, the increase in the provision due to the passage of time is recognised as a
finance cost.
2.18 Financial liabilities
Financial liabilities are classified according to the substance of the contractual arrangements entered
into and the definitions of a financial liability.
Financial liabilities, within the scope of MFRS 139, are recognised in the statements of financial position
when, and only when, the Group and the Company become a party to the contractual provisions of
the financial instrument. Financial liabilities are classified as either financial liabilities at fair value
through profit or loss or other financial liabilities.
(a)Financial liabilities at fair value through profit or loss
Financial liabilities at fair value through profit or loss include financial liabilities held for trading
and financial liabilities designated upon initial recognition as at fair value through profit or loss.
Financial liabilities held for trading include derivatives entered into by the Group and the
Company that do not meet the hedge accounting criteria. Derivative liabilities are initially
measured at fair value and subsequently stated at fair value, with any resultant gains or losses
recognised in profit or loss. Net gains or losses on derivatives include exchange differences.
The Group and the Company have not designated any financial liabilities as at fair value through
profit or loss.
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Notes to the
2.18 Financial liabilities (cont’d.)
(b)Other financial liabilities
The Group’s and the Company’s other financial liabilities include trade payables, other payables
and loans and borrowings.
Trade and other payables are recognised initially at fair value plus directly attributable transaction
costs and subsequently measured at amortised cost using the effective interest method.
Loans and borrowings are recognised initially at fair value, net of transaction costs incurred, and
subsequently measured at amortised cost using the effective interest method. Loans and
borrowings are classified as current liabilities unless the Group has an unconditional right to defer
settlement of the liability for at least 12 months after the reporting date.
For other financial liabilities, gains and losses are recognised in profit or loss when the liabilities
are derecognised, and through the amortisation process.
A financial liability is derecognised when the obligation under the liability is extinguished. When an
existing financial liability is replaced by another from the same lender on substantially different terms,
or the terms of an existing liability are substantially modified, such an exchange or modification is
treated as a derecognition of the original liability and the recognition of a new liability, and the
difference in the respective carrying amounts is recognised in profit or loss.
2.19 Borrowing costs
Borrowing costs are capitalised as part of the cost of a qualifying asset if they are directly attributable
to the acquisition, construction or production of that asset. Capitalisation of borrowing costs
commences when the activities to prepare the asset for its intended use or sale are in progress and
the expenditures and borrowing costs are incurred. Borrowing costs are capitalised until the assets
are substantially completed for their intended use or sale.
All other borrowing costs are recognised in profit or loss in the period they are incurred. Borrowing
costs consist of interest and other costs that the Group and the Company incurred in connection with
the borrowing of funds.
2.20 Employee benefits
(a)Defined contribution plans
The Group participates in the national pension schemes as defined by the laws of the countries
in which it has operations. The Malaysian companies in the Group make contributions to the
Employee Provident Fund in Malaysia, a defined contribution pension scheme. Contributions to
defined contribution pension schemes are recognised as an expense in the period in which the
related service is performed.
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2.20 Employee benefits (cont’d.)
(b)Employee share option plans
Employees of the Group receive remuneration in the form of share options as consideration for
services rendered. The cost of these equity-settled transactions with employees is measured by
reference to the fair value of the options at the date on which the options are granted. This cost
is recognised in profit or loss, with a corresponding increase in the employee share option reserve
over the vesting period. The cumulative expense recognised at each reporting date until the
vesting date reflects the extent to which the vesting period has expired and the Group’s best
estimate of the number of options that will ultimately vest. The charge or credit to profit or loss
for a period represents the movement in cumulative expense recognised at the beginning and
end of that period.
No expense is recognised for options that do not ultimately vest, except for options where vesting
is conditional upon a market or non-vesting condition, which are treated as vested irrespective
of whether or not the market or non-vesting condition is satisfied, provided that all other
performance and/or service conditions are satisfied. The employee share option reserve is
transferred to retained earnings upon expiry of the share options. When the options are exercised,
the employee share option reserve is transferred to share capital if new shares are issued, or to
treasury shares if the options are satisfied by the reissuance of treasury shares.
2.21Leases
(a)As lessee
Finance leases, which transfer to the Group substantially all the risks and rewards incidental to
ownership of the leased item, are capitalised at the inception of the lease at the fair value of the
leased asset or, if lower, at the present value of the minimum lease payments. Any initial direct
costs are also added to the amount capitalised. Lease payments are apportioned between the
finance charges and reduction of the lease liability so as to achieve a constant rate of interest
on the remaining balance of the liability. Finance charges are charged to profit or loss. Contingent
rents, if any, are charged as expenses in the periods in which they are incurred.
Leased assets are depreciated over the estimated useful life of the asset. However, if there is no
reasonable certainty that the Group will obtain ownership by the end of the lease term, the asset
is depreciated over the shorter of the estimated useful life and the lease term.
Operating lease payments are recognised as an expense in profit or loss on a straight-line basis
over the lease term. The aggregate benefit of incentives provided by the lessor is recognised as
a reduction of rental expense over the lease term on a straight-line basis.
(b)As lessor
Leases where the Group retains substantially all the risks and rewards of ownership of the asset
are classified as operating leases. Initial direct costs incurred in negotiating an operating lease
are added to the carrying amount of the leased asset and recognised over the lease term on
the same bases as rental income. The accounting policy for rental income is set out in Note
2.23(f).
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Notes to the
2.22 Discontinued operation
A component of the Group is classified as “discontinued operation” when the criteria to be classified
as held for sale have been met or it has been disposed of and such a component represents a
separate major line of business or geographical area of operations. A component is deemed to be
held for sale if its carrying amounts will be recovered principally through a sale transaction rather than
through continuing use.
Upon classification as held for sale, non current assets and disposal groups are not depreciated and
are measured at the lower of carrying amount and fair value less costs to sell. Any differences are
recognised in profit or loss.
2.23Revenue
Revenue is recognised to the extent that it is probable that the economic benefits will flow to the
Group and the revenue can be reliably measured. Revenue is measured at the fair value of
consideration received or receivable.
(a)Long term fixed price contracts
Revenue on long term fixed price contracts is recognised based on the percentage of completion
method determined on the proportion of costs incurred to date against total estimated costs.
Where the contract outcome cannot be measured reliably, revenue is recognised only to the
extent of the expenses recognised that are recoverable. All anticipated losses on contracts are
fully provided for.
(b)Short term contracts
Revenue is recognised upon rendering of services and transfer of significant risks. Revenue is not
recognised to the extent where there are significant uncertainties regarding recovery of the
consideration due or associated costs.
(c) Sale of goods
Revenue relates to sale of software and hardware is recognised upon the transfer of risks and
rewards of ownership of the goods to the customers. Revenue is not recognised to the extent
where there are significant uncertainties regarding recovery of the consideration due, associated
costs or the possible return of goods.
(d)Dividend income
Dividend income is recognised when the Group’s right to receive payment is established.
(e) Information technology professional services
Income is recognised based on net billings to customers for services where no fixed contract sum
is agreed up front.
Income is recognised based on percentage of completion method over the period of the
contract where a fixed sum has been agreed up front. The percentage of completion is
determined by reference to the costs incurred to date to the total estimated costs where the
outcome of the projects can be reliably estimated. All anticipated losses are fully provided.
(f) Rental income
Rental income is recognised on accrual basis based on agreed upon rental rates.
(g)Interest income
Interest income is recognised using the effective interest method.
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2.24 Income taxes
(a)Current tax
Current tax assets and liabilities are measured at the amount expected to be recovered from or
paid to the taxation authorities. The tax rates and tax laws used to compute the amount are
those that are enacted or substantively enacted by the reporting date.
Current taxes are recognised in profit or loss except to the extent that the tax relates to items
recognised outside profit or loss, either in other comprehensive income or directly in equity.
(b)Deferred tax
Deferred tax is provided using the liability method on temporary differences at the reporting date
between the tax bases of assets and liabilities and their carrying amounts for financial reporting
purposes.
Deferred tax liabilities are recognised for all temporary differences, except:
– where the deferred tax liability arises from the initial recognition of goodwill or of an asset or
liability in a transaction that is not a business combination and, at the time of the transaction,
affects neither the accounting profit nor taxable profit or loss; and
– in respect of taxable temporary differences associated with investments in subsidiaries,
associates and interests in joint ventures, where the timing of the reversal of the temporary
differences can be controlled and it is probable that the temporary differences will not reverse
in the foreseeable future.
Deferred tax assets are recognised for all deductible temporary differences, carry forward of
unused tax credits and unused tax losses, to the extent that it is probable that taxable profit will
be available against which the deductible temporary differences, and the carry forward of
unused tax credits and unused tax losses can be utilised except:
– where the deferred tax asset relating to the deductible temporary difference arises from the
initial recognition of an asset or liability in a transaction that is not a business combination
and, at the time of the transaction, affects neither the accounting profit nor taxable profit or
loss; and
– in respect of deductible temporary differences associated with investments in subsidiaries,
associates and interests in joint ventures, deferred tax assets are recognised only to the extent
that it is probable that the temporary differences will reverse in the foreseeable future and
taxable profit will be available against which the temporary differences can be utilised.
The carrying amount of deferred tax assets is reviewed at each reporting date and reduced to
the extent that it is no longer probable that sufficient taxable profit will be available to allow all
or part of the deferred tax asset to be utilised. Unrecognised deferred tax assets are reassessed
at each reporting date and are recognised to the extent that it has become probable that future
taxable profit will allow the deferred tax assets to be utilised.
Deferred tax assets and liabilities are measured at the tax rates that are expected to apply to
the year when the asset is realised or the liability is settled, based on tax rates and tax laws that
have been enacted or substantively enacted at the reporting date.
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Annual Report 2013
Notes to the
2.24 Income taxes (cont’d.)
(b)Deferred tax (cont’d.)
Deferred tax relating to items recognised outside profit or loss is recognised outside profit or loss.
Deferred tax items are recognised in correlation to the underlying transaction either in other
comprehensive income or directly in equity and deferred tax arising from a business combination
is adjusted against goodwill on acquisition.
Deferred tax assets and deferred tax liabilities are offset, if a legally enforceable right exists to set
off current tax assets against current tax liabilities and the deferred taxes relate to the same
taxable entity and the same taxation authority.
2.25 Segment reporting
For management purposes, the Group is organised into operating segments based on their products
and services which are independently managed by the respective segment managers responsible for
the performance of the respective segments under their charge. The segment managers report
directly to the management of the Company who regularly review the segment results in order to
allocate resources to the segments and to assess the segment performance. Additional disclosures
on each of these segments are shown in Note 36, including the factors used to identify the reportable
segments and the measurement basis of segment information.
2.26 Share capital and share issuance expenses
An equity instrument is any contract that evidences a residual interest in the assets of the Group and
the Company after deducting all of its liabilities. Ordinary shares are equity instruments.
Ordinary shares are recorded at the proceeds received, net of directly attributable incremental
transaction costs. Ordinary shares are classified as equity. Dividends on ordinary shares are recognised
in equity in the period in which they are declared.
2.27Contingencies
A contingent liability or asset is a possible obligation or asset that arises from past events and whose
existence will be confirmed only by the occurrence or non-occurrence of uncertain future event(s) not
wholly within the control of the Group.
Contingent liabilities and assets are not recognised in the statement of financial position of the Group.
2.28 Fair value measurements
The Group measures its financial instruments, such as, derivatives, at fair value at each reporting
date. Also, fair values of financial instruments measured at amortised cost are disclosed in Note 33(a).
Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly
transaction between market participants at the measurement date. The fair value measurement is
based on the presumption that the transaction to sell the asset or transfer the liability takes place
either:
(i) In the principal market for the asset or liability, or
(ii) In the absence of a principal market, in the most advantageous market for the asset or liability
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139
2.28 Fair value measurements (cont’d.)
The principal or the most advantageous market must be accessible to by the Group.
The fair value of an asset or a liability is measured using the assumptions that market participants
would use when pricing the asset or liability, assuming that market participants act in their economic
best interest.
A fair value measurement of a non-financial asset takes into account a market participant’s ability to
generate economic benefits by using the asset in its highest and best use or by selling it to another
market participant that would use the asset in its highest and best use.
The Group uses valuation techniques that are appropriate in the circumstances and for which
sufficient data are available to measure fair value, maximising the use of relevant observable inputs
and minimising the use of unobservable inputs.
Level 1 – Quoted (unadjusted) market prices in active markets for identical assets or liabilities
Level 2 –
Valuation techniques for which the lowest level input that is significant to the fair value
measurement is directly or indirectly observable
Level 3 –
Valuation techniques for which the lowest level input that is significant to the fair value
measurement is unobservable
For assets and liabilities that are recognised in the financial statements on a recurring basis, the
Group determines whether transfers have occurred between Levels in the hierarchy by re-assessing
categorisation (based on the lowest level input that is significant to the fair value measurement as a
whole) at the end of each reporting period.
2.29 Offsetting of financial instruments
Financial assets and financial liabilities are offset and the net amount is reported in the consolidated
statement of financial position if, and only if, there is a currently enforceable legal right to offset the
recognised amounts and there is an intention to settle on a net basis, or to realise the assets and
settle the liabilities simultaneously.
3. SIGNIFICANT ACCOUNTING JUDGEMENTS AND ESTIMATES
The preparation of the Group’s financial statements requires management to make judgements, estimates
and assumptions that affect the reported amounts of revenues, expenses, assets and liabilities, and the
disclosure of contingent liabilities at the reporting date. However, uncertainty about these assumptions and
estimates could result in outcomes that could require a material adjustment to the carrying amount of the
asset or liability affected in the future.
3.1
Judgements made in applying accounting policies
In the process of applying the Group’s accounting policies, apart from those involving estimations,
there are no significant judgements made by the management that has significant effect on the
amount recognised in the financial statements.
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Annual Report 2013
Notes to the
3. SIGNIFICANT ACCOUNTING JUDGEMENTS AND ESTIMATES (CONT’D.)
3.2
Key sources of estimation uncertainty
The key assumptions concerning the future and other key sources of estimation uncertainty at the
reporting date that have a significant risk of causing a material adjustment to the carrying amounts
of assets and liabilities within the next financial year are discussed below.
(a)Impairment of goodwill
Goodwill and other indefinite life intangibles are tested for impairment annually and at other times
when such indicators exist. This requires an estimation of the value in use of the cash-generating
units to which goodwill are allocated.
When value in use calculations are undertaken, management must estimate the expected future
cash flows from the asset or cash-generating unit and choose a suitable discount rate in order
to calculate the present value of those cash flows. Further details of the carrying value, the key
assumptions applied in the impairment assessment of goodwill and sensitivity analysis to changes
in the assumptions are given in Note 14.
(b)Deferred tax assets
Deferred tax assets are recognised for unrecognised tax losses, unabsorbed capital allowances
and other temporary differences to the extent that it is probable that taxable profit will be
available against which unabsorbed capital allowances and other temporary differences can be
utilised. Significant management judgement is required to determine the amount of deferred tax
assets that can be recognised, based upon the likely timing and level of future taxable profits
together with future tax planning strategies. The unrecognised tax losses, capital allowances and
other temporary differences of the Group and the Company were RM54,485,000 (2012:
RM14,342,000) and RM40,143,000 (2012: RM Nil) as disclosed in Note 19.
(c) Recognition of revenue from long term contracts
The Group and the Company recognised long term fixed price contracts revenue and expenses
in the income statements by using the stage of completion method. The stage of completion
method is determined by the proportion of actual contracts costs incurred for work performed to
date against the estimated total contract costs. The Group and the Company estimate total
contract costs based on regularly updated project budgets which may, because of their forward
looking nature, be subject to some degree of uncertainty.
(d)Deferred development cost
The Group capitalises project development costs incurred as part of requirement in bidding for
projects which are considered high in value and strategic to the Group’s business. Significant
judgement is required in determining the extent of costs incurred and the recoverability of the
development costs. In making the judgement, the Group evaluates based on past experiences,
current external economic factors and the progress and development of the contract.
(e) Impairment of loans and receivables
The Group and the Company assess at each reporting date whether there is any objective
evidence that a financial asset is impaired. To determine whether there is objective evidence of
impairment, the Group and the Company consider factors such as the probability of insolvency
or significant financial difficulties of the debtor and default or significant delay in payments. The
carrying amount of the Group’s and the Company’s loans and receivables at the reporting date
is disclosed in Note 21.
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141
3. SIGNIFICANT ACCOUNTING JUDGEMENTS AND ESTIMATES (CONT’D.)
3.2
Key sources of estimation uncertainty (cont’d.)
(f) Useful lives of property, plant and equipment
The cost of property, plant and equipment is depreciated on a straight-line basis over the assets’
useful lives. Management estimates the useful lives of these property, plant and equipment to be
within 3 to 50 years. These are common life expectancies applied in the industry. Changes in the
expected level of usage and technological developments could impact the economic useful lives
and the residual values of these assets, therefore future depreciation charges could be revised.
The carrying amount of the Group’s property, plant and equipment at the reporting date is
disclosed in Note 13.
4.REVENUE
Revenue of the Group and of the Company consist of the following:
Malaysian Communications and
Multimedia Commission (MCMC)
Licensable Activities
Network related services
Internet data centre services
Other activities
Sale of hardware and software
Maintenance charges
System application and development
Disaster recovery and facility management
services
Bulk mailing charges
Miscellaneous income
Group
Company
2013201220132012
RM’000RM’000RM’000RM’000
84,09592,10584,09592,105
577557577557
84,67292,66284,67292,662
75,01863,59259,37358,360
116,12083,309
116,12080,804
65,08177,82258,32374,342
35,33047,99135,33047,991
30,26925,698
––
7,3284,4552,2922,345
329,146302,867271,438263,842
Total revenue
413,818395,529356,110356,504
Revenue pertaining to the MCMC Licensable Activities refers to those attributable revenue prescribed under
the Communication and Multimedia Act (CMA) 1998 Framework. Under the CMA, the provision of network
related services and internet data centre services are licensed as Network Services Provider Individual
License (NSP (i)) and Application Service Provider Class License (ASP (c)) respectively.
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Annual Report 2013
Notes to the
5. OTHER INCOME
Group
Company
2013201220132012
RM’000RM’000RM’000RM’000
Interest income:
– Fixed deposits from license banks
Dividend income:
– Subsidiaries
– Other investments
Gain on disposal of property, plant and
equipment
Rental income
Net gain on remeasurement to fair value
of retained interest in a former associate
Net gain on disposal of investment in
a subsidiary
Reversal of allowance for impairment
of trade and other receivables
Others
1,3986,1531,3985,834
1,454933 ––
9,90112,02314,35728,214
474718423625
–––8,930
3,5852,5283,5852,528
97494949
2,8931,6428,9029,510
–––335
–––403
6. EMPLOYEE BENEFITS EXPENSE
Wages and salaries
Defined contributions plans and social
security contributions
Other benefits
Group
Company
2013201220132012
RM’000RM’000RM’000RM’000
81,22777,47222,27921,945
9,2908,8313,0203,599
5,9067,6621,8653,022
96,42393,96527,16428,566
Included in employee benefits expense of the Group and of the Company are executive directors’
remuneration amounting to RM1,307,000 (2012: RM1,602,000) and RM689,000 (2012: RM1,308,000)
respectively as further disclosed in Note 7.
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143
7. DIRECTORS’ REMUNERATION
The details of remuneration receivable by directors of the Company during the year are as follows:
Group
Company
2013201220132012
RM’000RM’000RM’000RM’000
Executive:
Salaries and other emoluments
Defined contribution plan
1,2041,430 6181,168
103172 71140
Total executive directors’ remuneration
(excluding benefits-in-kind) (Note 6)
Estimated money value of benefits-in-kind
1,3071,602 6891,308
79113 79102
Total executive directors’ remuneration
(including benefits-in-kind)
1,3861,715 7681,410
Non-executive:
Fees
Other emoluments
210305210305
10315
10315
Total non-executive directors’ remuneration
313320313320
Total directors’ remuneration (Note 31)
The number of directors of the Company whose total remuneration during the financial year fell within the
following bands is analysed below:
1,6992,0351,0811,730
Number of directors
2013
2012
Executive directors:
RM350,000 – RM400,000
RM850,000 – RM900,000
21
–1
Non-executive directors:
Up to RM50,000
RM50,000 – RM100,000
88
1–
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Annual Report 2013
Notes to the
8. FINANCE COSTS
Interest expense on:
Term loans
Revolving credits
Obligations under finance leases
Bank overdrafts
Due to directors of a subsidiary
Others
Group
Company
2013201220132012
RM’000RM’000RM’000RM’000
2,3782,9132,0892,906
565494565494
1,151851983759
2,8531,0452,7541,045
9999 ––
21748
18742
7,2635,4506,5785,246
9. (LOSS)/PROFIT BEFORE TAXATION FROM CONTINUING OPERATIONS
The following items have been included in arriving at (loss)/profit before tax from continuing operations:
Amortisation of intangible assets
– Discontinuing operation
Auditors’ remuneration
– Statutory audit
– Other services
Office rental
Impairment loss on:
– Trade receivables (Note 21)
– Other receivables (Note 21)
– Intangible assets (Note 14)
– Available-for-sale financial assets
Reversal of impairment loss on:
– Trade receivables (Note 21)
– Others receivables (Note 21)
Group
Company
2013201220132012
RM’000RM’000RM’000RM’000
87102 8788
87102 8788
––––
311244160125
311224160125
–20 ––
56415641
5,6784,7404,4214,377
5,6784,5964,4214,377
–144 ––
5,9694,6732,1954,183
7,963204
7,644204
–3,427
––
1,878809
1,878809
(1,298)(4,617)(1,297)(4,298)
(100)(1,536) (100)(1,536)
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145
9. (LOSS)/PROFIT BEFORE TAXATION FROM CONTINUING OPERATIONS (CONT’D.)
Depreciation of property, plant and
equipment
Loss on disposal of a subsidiary
Net loss on remeasurement to fair value of
retained interest in a former associate
Loss on disposal of other investment
Group
Company
2013201220132012
RM’000RM’000RM’000RM’000
8,80811,814 6,9559,598
8,79711,794 6,9559,598
1120 ––
2,072–
3,020–
–2,140
––
33925
33925
10. INCOME TAX EXPENSE/(BENEFIT)
Major components of income tax expense/(tax benefit)
The major components of income tax expense/(benefit) for the years ended 31 December 2013 and 2012
are:
Statement of comprehensive income:
Current income tax – continuing operations:
Malaysian income tax
(Over)/under provision in prior years
Deferred tax - continuing operations
(Note 19):
Relating to origination and reversal of
temporary differences
Under provision in prior years
Income tax attributable to continuing
operations
Income tax attributable to discontinued
operation (Note 11)
Income tax expense/(benefit) recognised
in profit or loss
Group
Company
2013201220132012
RM’000RM’000RM’000RM’000
1,4143,806
––
(14)(1,324) 218(1,241)
1,4002,482 218(1,241)
68(463)
145508
–(474)
–499
21345 –25
1,6132,527 218(1,216)
–70 ––
1,6132,597 218(1,216)
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Annual Report 2013
Notes to the
10. INCOME TAX EXPENSE/(BENEFIT) (CONT’D.)
Reconciliations between tax expense/(benefit) and accounting (loss)/profit
The reconciliations between tax expense/(benefit) and the product of accounting (loss)/profit multiplied by
the applicable corporate tax rate for the years ended 31 December 2013 and 2012 are as follows:
Group
Company
2013201220132012
RM’000RM’000RM’000RM’000
(Loss)/profit before taxation from continuing
operations
Loss before taxation from discontinued
operation (Note 11)
Accounting (loss)/profit before taxation
Taxation at Malaysian statutory tax rate
of 25% (2012: 25%)
Effect of income not subject to tax
Effect of expenses not deductible for tax
purposes
Utilisation of group relief
Effect of share of results of associates
Deferred tax assets not recognised during
the year
Utilisation of previously unrecognised
tax losses
Under/(over) provision of deferred tax
in prior years
(Over)/under provision of income tax
expense in prior years
Income tax expense/(benefit) recognised
in profit or loss
Domestic income tax is calculated at the Malaysian statutory tax rate of 25% (2012: 25%) of the estimated
assessable profit for the year. The domestic statutory tax rate will be reduced to 24% from the current year’s
rate of 25%, effective year of assessment 2016. The computation of deferred tax as at 31 December 2013
has reflected these changes.
Taxation for other jurisdictions is calculated at the rates prevailing in the respective jurisdictions.
The above reconciliation is prepared by aggregating separate reconciliations for each national jurisdiction.
(31,438)7,936
(45,654)1,962
(298)(499)
––
(31,736)7,437
(45,654)1,962
(7,934)1,859
(11,414)491
(1,286)(637)
(1,126)(2,865)
6933,9472,5312,096
–––(196)
–254 ––
10,036329
10,036–
(27)(2,336)
(27)–
145508 –499
–(15) ––
(14)(1,324) 218(1,241)
–12 ––
1,6132,597 218(1,216)
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147
11. DISCONTINUED OPERATION AND DISPOSAL GROUP CLASSIFIED AS HELD FOR SALE
The Group disposed off a 55% owned subsidiary, Electronic Media Airtime Services Sdn. Bhd. (“EMAS”), for
a total consideration of RM10,120,000. The consideration is made via share swap with an allottment of
9,200,000 ordinary shares of RM1 each, representing 80% of the issued and paid-up share capital of DAPAT
Vista (M) Sdn. Bhd. (“DVSB”). The subsidiary was operating in the television content services segment and
the disposal was completed on 15 May 2013. The assets and liabilities of the subsidiary has been deconsolidated and the results from this subsidiary is presented separately on the statement of comprehensive
income as discontinued operations.
Statement of financial position disclosures
The major classes of assets and liabilities of EMAS classified as held for sale as at 31 December 2012 are
as follows:
Group
2013
RM’000
2012
RM’000
Assets:
Tax recoverable
–65
–3,114
–9,885
–114
–409
–101
–13,688
Assets of disposal group classified as held for sale
Liabilities:
Borrowings
–771
–41
–5
Liabilities of disposal group classified as held for sale
–817
Net assets directly associated with disposal group classified as held for sale
–12,871
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Annual Report 2013
Notes to the
11. DISCONTINUED OPERATION AND DISPOSAL GROUP CLASSIFIED AS HELD FOR SALE (CONT’D.)
Statement of comprehensive income disclosures
The results of EMAS for the years ended 31 December 2013 and 2012 are as follows:
Group
2013
RM’000
Revenue
Interest income
2012
RM’000
404,950
–6
Total revenue
404,956
Employee benefits expense
Television program production costs
Depreciation (Note 9)
Other expenses
(171)(508)
(93)(3,767)
(11)(20)
(59)(409)
Total expenditure
(334)(4,704)
(Loss)/profit from operations
Finance costs
Share of results of an associated company
(294)252
(4)(4)
–(747)
Loss before taxation
Income tax expense (Note 10)
(298)(499)
–(70)
Loss from discontinued operation, net of tax
(298)(569)
Statement of cash flows disclosures
The cash flows attributable to EMAS were as follows:
Group
2013
RM’000
Operating
Investing
Financing
Net cash inflow/(outflow)
2012
RM’000
18(1,306)
(108)(25)
91(14)
1(1,345)
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149
11. DISCONTINUED OPERATION AND DISPOSAL GROUP CLASSIFIED AS HELD FOR SALE (CONT’D.)
Effects of disposal on financial position
Group
2013
RM’000
2012
RM’000
Tax recoverable
Borrowings
8936
1,7131,713
4,8225,437
26163
239225
5656
(181)(424)
(73)(23)
(3)(3)
6,9237,080
2,249
Net assets disposed
Attributable goodwill
Total disposal proceeds (Note 15)
Loss on disposal to the Group (Note 5)
9,172
(7,100)
2,072
Disposal proceeds settled by:
Cash
Deferred payment
Non-cash consideration
300
700
6,100
7,100
Cash inflow arising on disposal:
Cash consideration
Cash and bank balances of subsidiary disposed
300
(56)
Net inflow on disposal
244
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Annual Report 2013
Notes to the
12. (LOSS)/EARNINGS PER SHARE
(a) Continuing operations
Basic (loss)/earnings per share are calculated by dividing the (loss)/profit for the year from continuing
operations, net of tax, attributable to equity holders of the Company by the weighted average number
of ordinary shares outstanding during the financial year.
Diluted earnings per share is calculated by dividing the profit for the year from continuing operations,
net of tax, attributable to equity holders of the Company by the adjusted weighted average number of
ordinary shares in issue and issuable during the financial year.
No diluted earnings per share were presented as there were no potential dilutive ordinary shares
outstanding as at 31 December 2013. In prior year, the dilutive potential ordinary shares of the Group
comprise the employees’ share options. The basis for the maximum number of ordinary shares of
RM1.00 each to be issued upon the exercise of share options granted, the latest date for exercise and
exercise price are disclosed in Note 30.
The following tables reflect the (loss)/profit and share data used in the computation of basic and
diluted earning per share for the years ended 31 December:
Group
2013
RM’000
(32,579)4,876
(164)(313)
(Loss)/profit net of tax attributable to owners of the parent:
Total
Weighted average number of ordinary shares in issue for basic
loss/(earnings) per share computation
Effect of dilution:
Assumed shares issued from the exercise of options at
no consideration (’000)
Weighted average number of ordinary shares in issue
for diluted earnings per share computation
2012
RM’000
(32,743)4,563
Number of
Number of
shares
shares
’000
’000
101,225101,225
–4,631
101,225105,856
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151
12. (LOSS)/EARNINGS PER SHARE (CONT’D.)
(a) Continuing operations (cont’d.)
Group
2013
Basic (loss)/earnings per share (sen per share)
Diluted earnings per share (sen per share)
(32.35)4.51
–4.31
Group
2013
Basic (loss)/earnings per share (sen per share)
Diluted earnings per share (sen per share)
2012
2012
(32.18)4.82
(0.16)(0.31)
(32.34)4.51
–4.61
–(0.30)
–4.31
(b) Discontinued operation
The basic and diluted loss per share from discontinued operation are calculated by dividing the loss
from discontinued operation, net of tax, attributable to owners of the parent by the weighted average
number of ordinary shares for basic loss per share computation and weighted average number of
ordinary shares for diluted loss per share computation respectively. The loss and share data are
presented in the tables in Note 12(a).
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HeiTech Padu Berhad
Annual Report 2013
Notes to the
13. PROPERTY, PLANT AND EQUIPMENT
Machinery,
office
Computers
equipment,
and
Construction
Freehold
Motor
furniture
network
work in
land
Building
vehicles and fittings equipment Renovation
progress
Total
Group
RM’000RM’000RM’000RM’000RM’000RM’000RM’000RM’000
Cost
At 1 January 2012
Additions
Disposals
Attributable to discontinued
operation
Exchange differences
11,506
44,248
2,581
34,584 160,468
21,579
– 274,966
–
70 680 4,181 2,688 50510,81718,941
–
–
– (1,500)(1,581)(1,367)
– (4,448)
– –(138)(56)(97)(17) –(308)
– (208)(182)(195)
–
–
– (585)
At 31 December 2012
and 1 January 2013
Acquisition of new subsidiaries
Additions
Disposals
11,50644,110 2,94137,014
161,47820,70010,817
288,566
–
– 5876,2642,301 44
–9,196
– – 3512962325
5,538
7,340
–
– (614) (1) (752) (52)
–(1,419)
–
(56)
(54)
(226)–––
(336)
11,50644,054 2,86343,563
163,98921,01716,355
303,347
At 31 December 2013
Accumulated depreciation
At 1 January 2012
–
12,845
2,195
22,033 153,067
16,266
– 206,406
Charge for the year3,566 2671,7173,8342,430
–
11,814
Disposals
–
–
– (1,493)(1,581)(1,364)
– (4,438)
Attributable to discontinued
operation
– –(138)(42)(53)(10) –(243)
–(4)
(3)
(30)–––
(37)
At 31 December 2012
and 1 January 2013
Charge for the year
Disposals
–16,407 2,32122,185
155,26717,322
–
213,502
–
– 5105,5991,822 16
–7,947
–3,645 1021,1542,4711,436
–8,808
–
– (614) (1) (752) (24)
–(1,391)
––
(26)
(42)–––
(68)
–20,052 2,29328,895
158,80818,750
At 31 December 2013
–
228,798
Net carrying amount
At 31 December 2012
11,50627,703
62014,829 6,211 3,37810,81775,064
11,50624,002
57014,668 5,181 2,26716,35574,549
At 31 December 2013
page
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153
13. PROPERTY, PLANT AND EQUIPMENT (CONT’D.)
Office
Computers
equipment,
and
Construction
Freehold
Motor
furniture
network
work in
land
Building
vehicles and fittings equipment Renovation
progress
Total
Company
RM’000RM’000RM’000RM’000RM’000RM’000RM’000RM’000
Cost
At 1 January 2012
Additions
Disposals
9,895
38,995
1,558
15,680 155,467
21,973
– 243,568
–
24
– 288 1,144 50510,81712,778
–
–
– (1,494)(1,581)(1,367)
– (4,442)
At 31 December 2012
and 1 January 2013
Additions
Disposals
9,89539,019 1,55814,474
155,03021,11110,817
251,904
– – –128657293
5,538
6,616
– –
(352)(1)
(752)(8) –
(1,113)
9,89539,019 1,20614,601
154,93521,39616,355
257,407
At 31 December 2013
Accumulated depreciation
At 1 January 2012
Charge for the year
Disposals
–
11,969
1,484
11,919 149,651
16,282
–3,399 59 3663,3472,427
–
–
– (1,493)(1,581)(1,364)
At 31 December 2012
and 1 January 2013
Charge for the year
Disposals
–15,368 1,54310,792
151,41717,345
–
196,465
–3,645 14 2621,6001,434
–6,955
– –
(352)(1)
(752)(8) –
(1,113)
At 31 December 2013
–19,013 1,20511,053
152,26518,771
Net carrying amount
At 31 December 2012
9,895
At 31 December 2013
9,89520,006
Assets held under finance leases
During the financial year, the Group and the Company acquired property, plant and equipment at
aggregate cost of RM7,340,000 (2012: RM18,941,000) and RM6,616,000 (2012: RM12,778,000) respectively of
which RMNil (2012: RM12,775,000) of the Group and RMNil (2012: RM10,817,000) of the Company were
acquired by means of finance leases. The net carrying amount of property, plant and equipment of the
Group and of the Company held under finance lease were RM14,813,000 (2012: RM15,829,000) and
RM10,817,000 (2012: RM10,817,000) respectively.
23,651
15
3,682
3,613
3,766
– 191,305
–9,598
– (4,438)
–
202,307
10,817
55,439
1 3,548 2,670 2,62516,35555,100
page
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154
Annual Report 2013
Notes to the
13. PROPERTY, PLANT AND EQUIPMENT (CONT’D.)
Assets pledged as security
In addition to assets held under finance leases, the net carrying amounts of property, plant and equipment
pledged as securities for loans and borrowings (Note 25) are as follows:
Group
Company
2013201220132012
RM’000RM’000RM’000RM’000
9,8959,8959,8959,895
2,7802,848
––
Freehold land
Building
12,67512,743 9,8959,895
14. INTANGIBLE ASSETS
Software Deferred
Secureddevelopmentdevelopment
Goodwill
contractcostscosts Total
Group
RM’000RM’000RM’000RM’000RM’000
Cost
At 1 January 2012
Additions
At 31 December 2012
and 1 January 2013
Acquisition of subsidiaries
Additions
Transfer to amount due
from customers on contracts
At 31 December 2013
Accumulated amortisation
and impairment
At 1 January 2012
Amortisation
Impairment
At 31 December 2012
and 1 January 2013
Amortisation
18,627
11,397
1,056
2,542
33,622
–
–
–9,9919,991
– –(28) –(28)
18,62711,397 1,02812,53343,585
8,959–––
8,959
(5,676)(11,397)
–
– (17,073)
–
–3,4302,7216,151
–––
(15,254)
(15,254)
21,910–
4,458–
26,368
–
11,397
579
–
11,976
– –102 –102
3,427–––
3,427
3,42711,397
681
–15,505
(3,427)(11,397)
–
– (14,824)
– –87 –87
–
–768
–768
At 31 December 2013
Net carrying amount
At 31 December 2012
15,200
At 31 December 2013
21,910–
3,690–
25,600
–
347
12,533
28,080
page
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155
14. INTANGIBLE ASSETS (CONT’D.)
Secured contract of the Group relates to the fair value of contracts of a former subsidiary recognised upon
acquisition of that subsidiary.
Company
Software Deferred
development development
costs
costs
Total
RM’000RM’000RM’000
Cost
At 1 January 2012
Additions
1,054
2,542
3,596
–9,9919,991
At 31 December 2012 and 1 January 2013
Additions
Transfer to amount due from customers on contracts
1,05412,53313,587
–2,7212,721
– (15,254)(15,254)
1,054
At 31 December 2013
–1,054
Accumulated amortisation
At 1 January 2012
Amortisation
639
88
Amortisation
727 –727
87 –87
At 31 December 2013
814
Net carrying amount
At 31 December 2012
327
At 31 December 2013
240
Impairment testing of goodwill
Goodwill arising from business combinations has been allocated to three individual cash-generating units
(“CGU”) for impairment testing as follows:
–
–
–814
12,533
Computer software development, sales and support
Mailing and document processing services
Mobile value added services
Television content services
12,860
–240
Group
2013
RM’000
639
88
2012
RM’000
Restated
5,5325,532
9,6087,419
6,770–
–2,249
21,91015,200
page
HeiTech Padu Berhad
156
Annual Report 2013
Notes to the
14. INTANGIBLE ASSETS (CONT’D.)
Key assumptions used in value in use calculations
The recoverable amount of a CGU is determined based on value in use calculations using cash flow
projections based on financial budgets approved by management covering a five year period.
The calculations of value in use for the CGUs are most sensitive to the following assumptions:
(a) Budgeted gross margin
The basis used to determine the value assigned to the budgeted gross margin is the average margin
achieved in the year immediately before the budgeted year increased for expected efficiency
improvements.
(b) Budgeted growth rate
The management believes that the average growth rates at 5% to 10% (2012: 6%) used are consistent
with the long term average growth rate of the economy.
(c) Discount rate
The discount rates used at 3.1% (2012: 3.1%) are pre-tax and reflect specific risks relating to the relevant
segments.
Sensitivity to changes in assumptions
With regard to the assessment of value in use of the subsidiaries, management believes that no reasonably
possible change in any of the above key assumptions would cause the carrying values of the units to
materially exceed their recoverable amounts.
15. INVESTMENTS IN SUBSIDIARIES
Unquoted ordinary shares, at cost
Redeemable convertible preference shares of RM1.00 each
Company
2013
RM’000
2012
RM’000
48,73852,758
2,1402,140
Less: Accumulated impairment losses
50,87854,898
(7,946)(7,946)
42,93246,952
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157
15. INVESTMENTS IN SUBSIDIARIES (CONT’D.)
Country of
Name
incorporation
Principal activities
Effective
equity interest (%)
20132012
Held by the Company:
Motordata Research
Malaysia
Consortium Sdn. Bhd.
Development and provision of a
centralised parts pricing database
for Malaysian insurance industry.
6060
Development and marketing of
computer aided educational software.
7777
Dapat Vista (M) Sdn. Bhd. Malaysia
Business related to providing mobile
value added services.
80–
Electronic Media Airtime
Malaysia
Services Sdn. Bhd.*
Production and supply of contents to
broadcasting stations, airtime
management, rental of production
facilities and other related services.
Provision of mail processing and
its related services.
100100
HeiTech i-Solution
Malaysia
Sdn. Bhd.
Computer software development and
marketing of software, contract
programming services and product
systems integration and other
computer related services.
100100
Integrated Healthcare
Malaysia
Solutions Sdn. Bhd.
Provision of a one-stop customer
support service centre and
consultancy service desks.
100100
HeiTech E*Business
Malaysia
Solutions Sdn. Bhd.
Provision of research and development
in developing, installing and
supporting software for small and
medium sized industries.
100100
HeiTech Defence
Malaysia
System Sdn. Bhd.
Provision for information and
communication technology products
and services for the defence industry.
100100
HeiTech Health
Malaysia
Solution Sdn. Bhd.
Provision for information and
communication technology products
and services for the health industry.
100100
HeiTech Managed
Malaysia
Services Sdn. Bhd.
Provision of consultancy services, network management, local area
network design and installation
services.
100100
Educational Trend
Malaysia
Sdn. Bhd.
Inter-City MPC (M)
Malaysia
Sdn. Bhd.
–55
page
158
HeiTech Padu Berhad
Annual Report 2013
Notes to the
Country of
Name
incorporation
Effective
equity interest (%)
20132012
Held by the Company (cont’d.):
Padusoft Sdn. Bhd.
Malaysia
Dormant.
100100
Vante Sdn. Bhd.
Malaysia
Dormant.
100100
Megacenter System
Sdn. Bhd.
Malaysia
Dormant.
100100
E-Image Technologies
Sdn. Bhd.
Malaysia
Dormant.
100100
Computer software development, sales and support for the motor
body industry.
100100
100–
Cinix 1 Pty. Ltd.^
Australia
Held through Inter-City
MPC (M) Sdn. Bhd.:
Pro Office Solutions
Malaysia
Sdn. Bhd.
PT. Intercity Kerlipan^
Indonesia
Held through Electronic
Media Airtime Services
Sdn. Bhd.:
EMASTV Pte. Ltd.*
Singapore
Dormant.
7070
–100
^ The financial statements of these companies are coterminous with those of the Group and audited by firms of chartered accountants
other than Hanafiah Raslan & Mohamad.
* Classified as discontinued operation during the current financial year (Note 11).
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159
(a) Acquisition of subsidiaries
HeiTech Padu Berhad
The Company acquired 9,200,000 ordinary shares of RM1 each, representing 80% of the issued and
paid-up share capital of Dapat Vista (M) Sdn. Bhd. on 15 May 2013, for a total consideration of
RM9,120,000 via share swap with 55% of shareholding in EMAS. Refer Note 11 for more details.
The acquisition had the following effects on the financial position of the Group as at the end of the
year.
The fair values of the identifiable assets and liabilities of Dapat Vista (M) Sdn. Bhd. as at the date of
acquisition were:
Fair value
RM’000
Plant and equipment
Net identifiable liabilities
Carrying
amount
RM’000
421
1,133
228
(1,412)
(1,208)
421
1,133
228
(1,412)
(1,208)
(838)
(838)
RM’000
The effect of the acquisition on cash flows is as follows:
Total cost of the business combination
Less: Non-cash consideration
Consideration settled in cash
Less: Cash and cash equivalents of subsidiary acquired
–
(228)
Net cash inflow on acquisition
(228)
Goodwill arising on acquisition
6,100
(6,100)
RM’000
Fair value of net identifiable liabilities
Add: Non-controlling interests
(838)
168
Group’s interest in fair value of net identifiable liabilities
Goodwill on acquisition (Note 14)
(670)
6,770
Fair value of consideration
6,100
MFRS 3 contains provisions which allows the acquirer a measurement period not exceeding one year
from the acquisition date to identify and measure all of the various components of the business
combination as of the acquisition date. As such, the fair value of the acquired identifiable liabilities of
RM838,000 is provisional pending receipt of the final valuations for those assets.
page
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160
Annual Report 2013
Notes to the
(a) Acquisition of subsidiaries (cont’d.)
Inter-City MPC (M) Sdn. Bhd.
A subsidiary, Inter-City MPC (M) Sdn. Bhd., acquired 100% equity interest in Pro Office Solutions Sdn. Bhd.
on 31 August 2013 for a total cash consideration of RM9,000,000.
The acquisition had the following effects on the financial position of the Group as at the end of the
year.
The fair values of the identifiable assets and liabilities of Pro Office Solutions Sdn. Bhd. as at the date
of acquisition were:
Fair value
RM’000
Plant and equipment
Inventories
Tax recoverable
Net identifiable assets
Carrying
amount
RM’000
1,602
296
9,480
240
788
(3,779)
(1,539)
(277)
1,602
296
9,480
240
788
(3,779)
(1,539)
(277)
6,811
6,811
RM’000
The effect of the acquisition on cash flows is as follows:
Total cost of the business combination
Less: Cash and cash equivalents of subsidiary acquired
9,000
(788)
Net cash outflow on acquisition
8,212
Goodwill arising on acquisition
RM’000
Fair value of net identifiable assets
Goodwill on acquisition (Note 14)
6,811
2,189
Cost of business combination
9,000
MFRS 3 contains provisions which allows the acquirer a measurement period not exceeding one year
from the acquisition date to identify and measure all of the various components of the business
combination as of the acquisition date. As such, the fair value of the acquired identifiable assets of
RM6,811,000 is provisional pending receipt of the final valuations for those assets.
(b) Disposal of a subsidiary
Information relating to the disposed subsidiary during the financial year are set out in Note 11.
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161
16. INVESTMENTS IN ASSOCIATES
Group
Company
2013201220132012
RM’000RM’000RM’000RM’000
Unquoted shares, at cost
Share of post-acquisition reserves
3,075575
2,900400
4,0973,445
––
Less: Accumulated impairment losses
7,1724,0202,900400
(3,075)(575)
(2,900)(400)
4,0973,445
Country of
Name
incorporation
Held by the Company:
East Coast Multimedia
Academy Sdn. Bhd.^
––
Effective
equity interest (%)
20132012
Dormant.
4040
Business to business (B2B)
e-commerce solution provider.
40–
Vantage Point Consulting
Malaysia
Sdn. Bhd.
Provision of System Application
and Products (“SAP”) contract
programming consultance and
turnkey project services.
5050
PlayTV Asia Sdn. Bhd.^*
Malaysia
Provision of digital media services, online TV commercials and
digital advertisements.
Malaysia
E-Komoditi Sdn. Bhd.^
Malaysia
Held through subsidiaries:
–16.5
Held through associate:
Vantage Point Consulting
Singapore
(Sg) Pte. Ltd.^
Provision of System Application
and Products (“SAP”) services
in the ASEAN region.
5050
^ Audited by firms of chartered accountants other than Hanafiah Raslan & Mohamad.
* Disposed off during the current financial year (Note 11).
The directors deem the interest in E-Komoditi Sdn. Bhd. (EKSB) to be an investment in associate as the
Company started having significant influence on EKSB effective 1 January 2013. Prior to this, the investment
in EKSB was classified as a simple investment.
page
HeiTech Padu Berhad
162
Annual Report 2013
Notes to the
16. INVESTMENTS IN ASSOCIATES (CONT’D.)
The summarised financial information of the associates, not adjusted for the proportion of ownership interest
held by the Group, is as follows:
2013
RM’000
2012
RM’000
Assets and liabilities
Total assets
28,69622,991
Total liabilities
28,41712,563
Results
Revenue
37,27729,279
1,595(110)
Profit/(loss) for the year
17. OTHER INVESTMENTS
Available-for-sale financial assets:
Equity instruments (unquoted), at cost
Equity instruments (quoted), at fair value
Total
Group
Company
2013201220132012
RM’000RM’000RM’000RM’000
6,3128,2146,1488,050
–7,303
–7,303
6,31215,517 6,14815,353
18. LEASE RECEIVABLE
Group
Company
2013201220132012
RM’000RM’000RM’000RM’000
Current
Lease receivable
32,41532,41532,41532,415
Non-current
Lease receivable
81,94293,54681,94293,546
114,357125,961114,357125,961
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163
18. LEASE RECEIVABLE (CONT’D.)
The lease receivable represents the present value of payments receivable from the Government of Malaysia
in relation to a build and lease arrangement. The lease to the Government has been ascertained to be a
finance lease. In determining the present value, a discount rate of 7.5% has been utilised.
Group
Company
2013201220132012
RM’000RM’000RM’000RM’000
Total minimum lease receivable
Less: Amount representing unwinding
discount
228,137239,741228,137239,741
Present value of minimum lease receivable
The remaining maturities of the
lease receivable are as follows:
Not later than 1 year
Later than 1 year but not later than 2 years
Later than 2 years but not later than 5 years
Present value of minimum lease receivable
Less: Amount due within 12 months
Amount due after 12 months
(113,780)(113,780)(113,780)(113,780)
114,357125,961114,357125,961
32,41532,41532,41532,415
64,83064,83064,83064,830
17,11228,71617,11228,716
114,357125,961114,357125,961
(32,415)(32,415)(32,415)(32,415)
81,94293,54681,94293,546
19. DEFERRED TAXATION
Deferred tax (assets)/liabilities of the Group and Company relate to the following:
Group
Accelerated
Other
capital temporary
allowancesdifferences
Total
RM’000RM’000RM’000
At 1 January 2012
Recognised in profit or loss
Attributable to discontinued operation
(2,775)
51
(5)
3,152
(6)
–
377
45
(5)
(2,729)3,146 417
–277277
430(217)213
At 31 December 2013
(2,299)3,206
907
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HeiTech Padu Berhad
164
Annual Report 2013
Notes to the
19. DEFERRED TAXATION (CONT’D.)
Company
Accelerated
Other
capital temporary
allowancesdifferences
Total
RM’000RM’000RM’000
At 1 January 2012
1,743
4
1,747(2,331) (584)
–––
At 31 December 2013
1,747(2,331) (584)
Group
(2,352)
21
(609)
25
Company
2013201220132012
RM’000RM’000RM’000RM’000
Restated
Presented after appropriate offsetting
as follows:
Deferred tax assets
1,4911,001
––
(584)(584)(584)(584)
907417
(584)(584)
Deferred tax assets have not been recognised in respect of the following items:
Group
Company
2013201220132012
RM’000RM’000RM’000RM’000
RestatedRestated
54,48514,34240,143–
Unrecognised tax losses
The availability of the unrecognised tax losses, unabsorbed capital allowances and other temporary
differences for offsetting against future taxable profits of the respective subsidiaries are subject to no
substantial changes in shareholdings of those subsidiaries under the Income Tax Act, 1967 and guidelines
issued by the tax authority.
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165
20.INVENTORIES
Group
2013
RM’000
Cost
Consumables
2012
RM’000
1,4421,523
21. TRADE AND OTHER RECEIVABLES
Group
Company
2013201220132012
RM’000RM’000RM’000RM’000
164,748165,868131,045148,699
––
16,31912,202
2,4022,7612,4022,761
Trade receivables
Third parties
Amounts due from subsidiaries
Amounts due from associates
Less:
Allowance for impairment
– Third parties
– Amounts due from subsidiaries
– Amounts due from associates
Trade receivables, net
Other receivables
Amounts due from subsidiaries
Amount due from a corporate shareholder
Deposits
Sundry receivables
Less: Allowance for impairment
– Sundry receivables
167,150168,629149,766163,662
(23,970)(19,299)(16,220)(15,322)
––
(2,003)(2,003)
(601)(601)(601)(601)
142,579148,729130,942145,736
–––4,871
335335335335
4,0975,5273,2163,003
27,48123,99226,04222,271
31,91329,85429,59330,480
(19,866)(12,003)(19,092)(11,548)
12,04717,85110,50118,932
Total trade and other receivables
Add: Cash and bank balances (Note 24)
154,626166,580141,443164,668
36,89273,00529,72171,075
Total loans and receivables
191,518239,585171,164235,743
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166
Annual Report 2013
Notes to the
21. TRADE AND OTHER RECEIVABLES (CONT’D.)
(a) Trade receivables
Trade receivables are non-interest bearing and are generally on 30 day (2012: 30 day) terms. They are
recognised at their original invoice amounts which represent their fair values on initial recognition.
Ageing analysis of trade receivables
The ageing analysis of the Group’s and Company’s trade receivables is as follows:
Group
Company
2013201220132012
RM’000RM’000RM’000RM’000
Neither past due nor impaired
96,223112,916 90,613107,464
1 to 30 days past due not impaired
31 to 60 days past due not impaired
More than 61 days past due
not impaired
23,94511,11721,74610,123
5,3667,8513,6346,444
Impaired
17,04516,84514,94921,705
46,35635,81340,32938,272
24,57119,90018,82417,926
167,150168,629149,766163,662
Receivables that are neither past due nor impaired
Trade and other receivables that are neither past due nor impaired are creditworthy debtors with good
payment records with the Group and the Company.
None of the Group’s and the Company’s trade receivables that are neither past due nor impaired have
been renegotiated during the financial year.
Receivables that are past due but not impaired
The Group and the Company have trade receivables amounting to RM46,356,000 (2012: RM35,813,000)
and RM40,329,000 (2012: RM38,272,000) respectively that are past due at the reporting date but not
impaired.
Trade receivables that were past due but not impaired relate to customers that have a good track
record with the Group and the Company mainly the ministries and agencies related to Government of
Malaysia. Based on past experience and no adverse information to date, the directors of the Group
and of the Company are of the opinion that no provision for impairment is necessary in respect of these
balances as there has not been a significant change in the credit quality and the balances are still
considered fully recoverable.
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167
(a) Trade receivables (cont’d.)
Receivables that are impaired
The Group’s and the Company’s trade receivables that are impaired at the reporting date and the
movement of the allowance accounts used to record the impairment are as follows:
Individually impaired
Group
Company
2013201220132012
RM’000RM’000RM’000RM’000
24,57119,90018,82417,926
(24,571)(19,900)(18,824)(17,926)
Trade receivables – nominal amounts
––––
Movement in allowance accounts:
Group
Company
2013201220132012
RM’000RM’000RM’000RM’000
At 1 January
Charge for the year (Note 9)
Reversal of impairment loss (Note 9)
19,90019,84417,92618,041
5,9694,6732,1954,183
(1,298)(4,617)(1,297)(4,298)
At 31 December
24,57119,90018,82417,926
Trade receivables that are individually determined to be impaired at the reporting date relate to debtors
that have defaulted on payments. These receivables are not secured by any collateral or credit
enhancements.
(b) Amounts due from subsidiaries and a corporate shareholder
Amounts due from subsidiaries and a corporate shareholder are non-trade in nature, non-interest
bearing, unsecured and are repayable on demand.
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Annual Report 2013
Notes to the
(c) Sundry receivables
Other receivables that are impaired
The Group’s other receivables that are impaired at the reporting date and the movement of the
allowance accounts used to record the impairment are as follows:
Individually impaired
Group
Company
2013201220132012
RM’000RM’000RM’000RM’000
19,86612,00319,09211,548
(19,866)(12,003)(19,092)(11,548)
Other receivables – nominal amounts
––––
Movement in allowance accounts:
Group
Company
2013201220132012
RM’000RM’000RM’000RM’000
At 1 January
Charge for the year (Note 9)
Reversal of impairment loss (Note 9)
12,00313,33511,54812,880
7,963204
7,644204
(100)(1,536) (100)(1,536)
At 31 December
19,86612,00319,09211,548
22. OTHER CURRENT ASSETS
Group
Company
2013201220132012
RM’000RM’000RM’000RM’000
Prepayments
Due from customers on contracts (Note 23)
Lease receivable (Note 18)
179363 ––
58,41619,92261,94718,556
32,41532,41532,41532,415
91,01052,70094,36250,971
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169
23. DUE FROM CUSTOMERS ON CONTRACTS
Group
Company
2013201220132012
RM’000RM’000RM’000RM’000
262,601155,033266,132153,667
33,04839,12433,04839,124
Contract costs incurred to date
Attributable profits
Less: Progress billings
295,649194,157299,180192,791
(237,233)(174,235)(237,233)(174,235)
58,41619,92261,94718,556
Included in the amount due from customers on contracts are:
Group
Company
2013201220132012
RM’000RM’000RM’000RM’000
Contract costs incurred during the year
107,56828,207
112,46526,841
The contract costs are the system development costs.
24. CASH AND CASH EQUIVALENTS
Group
Company
2013201220132012
RM’000RM’000RM’000RM’000
Cash at banks and in hand
Short term deposits with licensed banks
9,29046,635 3,90945,034
27,60226,37025,81226,041
36,89273,00529,72171,075
Short term deposits with licensed banks of the Group and of the Company amounting to RM25,812,000
(2012: RM26,370,000) and RM25,812,000 (2012: RM26,041,000) respectively are pledged as securities for
borrowings (Note 25).
Deposits with licensed banks earn interests at the respective deposit rates. The weighted average effective
interest rate as at 31 December 2013 for the Group and the Company was 2.91% (2012: 2.48%) per annum.
The maturity period of deposits as at 31 December 2013 for the Group and the Company was 308 days
(2012: 295 days).
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Annual Report 2013
Notes to the
24. CASH AND CASH EQUIVALENTS (CONT’D.)
For the purpose of the statements of cash flows, cash and cash equivalents comprise the following at the
reporting date:
Group
Company
2013201220132012
RM’000RM’000RM’000RM’000
Cash and short term deposits:
Continuing operations
Discontinued operation
36,89273,00529,72171,075
–101 ––
Less: Bank overdrafts (Note 25)
36,89273,10629,72171,075
(37,853)(32,607)(36,608)(32,607)
(961)40,499 (6,887)38,468
25. LOANS AND BORROWINGS
Group
Maturity
Company
2013201220132012
RM’000RM’000RM’000RM’000
Current
Secured:
Term loans
2014
Bank overdrafts
On demand
Revolving credits
Obligations under finance
leases (Note 32(c))
2014
22,47128,79221,78528,792
12,12519,15210,88019,152
45,42271,12445,42271,124
84,692124,021 81,693122,674
Non-current
Secured:
Term loans
Bank overdrafts
Obligations under finance
leases (Note 32(c))
2015 – 2018
2018
79,21273,88671,04073,886
25,72813,45525,72813,455
2015 – 2018
3,0866,7002,6196,225
4,6744,9533,6063,606
108,02694,04199,38793,566
192,718218,062181,080216,240
Total loans and borrowings
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171
25. LOANS AND BORROWINGS (CONT’D.)
The remaining maturities of the loans and borrowings as at 31 December are as follows:
Group
2013201220132012
RM’000RM’000RM’000RM’000
Maturity of loans and borrowings:
Within one year
More than 1 year and less than 2 years
More than 2 years and less than 5 years
Term loans
Group
84,692124,021 81,693122,674
32,61730,85632,27430,513
75,40963,18567,11363,053
192,718218,062181,080216,240
Company
Term
Term
Term
Term
loan
loan
loan
loan
Company
2013201220132012
RM’000RM’000RM’000RM’000
1
2
3
4
75,63789,56175,63789,561
17,18813,11717,18813,117
8,184–––
674–––
101,683102,678 92,825102,678
(i) Term loan 1 is drawndown by the Company in relation to the design, built, supply, install, commission
and maintain the Tactical Operational Flight Trainer, the building facilities and the Computer Based
Trainer on the contract awarded by the Ministry of Defense of Malaysia.
Term loan 1 is secured by the following:
– First, second and third legal charge over the freehold land of the Company as disclosed in Note 13;
– Assignment of all contract proceeds of the Company with the exception of the Government-related
contracts.
(ii) Term loan 2 is drawndown by the Company in relation to the construction of a datacentre.
– First, second and third legal charge over the freehold land of the Company as disclosed in Note 13;
– Assignment of all contract proceeds of the Company with the exception of the Government-related
contracts.
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Annual Report 2013
Notes to the
25. LOANS AND BORROWINGS (CONT’D.)
Term loans (cont’d.)
(iii) Term loan 3 is drawndown by a subsidiary in relation to the construction of a factory.
– First legal charge over a building of the subsidiary as disclosed in Note 13 to the financial statements;
– Joint and several guarantee by certain directors.
(iv) Term loan 4 is drawndown by a subsidiary in relation to the development of a project.
– Debenture over all present and future assets of the subsidiary;
– Assignment of contract proceed from the project;
– Memorandum of Deposit of Sinking Fund; and
– Personnel guarantee by one of the director.
Term loans bear interest at respective term loan’s rates. The weighted average effective interest rate of
term loans of the Group were 4.34% (2012: 4.24%) per annum. The repayment of the Group’s term loans
are due from 2012 to 2018.
Bank overdrafts
Bank overdrafts are secured by negative pledge on all present and future unencumbered assets of the
Company. The weighted average effective interest rate of bank overdrafts was 7.50% (2012: 7.47%) per
annum.
Revolving credits
Revolving credits are secured by negative pledge on all present and future unencumbered assets of the
Company. The weighted average effective interest rate of revolving credits was 4.05% (2012: 3.95%) per
annum.
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173
26. TRADE AND OTHER PAYABLES
Trade payables
Third parties
Amounts due to subsidiaries
Other payables
Amount due to directors of a subsidiary
Deposits
Accruals
Sundry payables
Group
Company
2013201220132012
RM’000RM’000RM’000RM’000
91,40571,09681,50166,792
––
30,43420,502
91,40571,096
111,93587,294
3,2212,853
––
1,2311,1001,2311,100
4,1367,1592,5354,350
4,1879,0344,3437,570
12,77520,146 8,10913,020
Total trade and other payables
Add: Loans and borrowings (Note 25)
104,18091,242
120,044100,314
192,718218,062181,080216,240
Total financial liabilities carried at
amortised cost
296,898309,304301,124316,554
(a) Third parties
These amounts are non-interest bearing. Trade payables are normally settled on 30 to 90 day (2012: 30
to 90 day) terms.
(b) Amount due to directors of a subsidiary
The amount due to directors of a subsidiary is unsecured, bear interest at 10% per annum and is
repayable on demand. The loans from directors are convertible into 10% Redeemable Preference Shares
(RPS) of RM1.00 each of the subsidiary at the rate of 1.00 RPS for every RM1.00 of the loan outstanding.
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Annual Report 2013
Notes to the
27. SHARE CAPITAL AND SHARE PREMIUM
Group and Company
Number of
ordinary
shares of
RM1 each
Amount
Share
Share
Total share
capitalcapitalcapital
(Issued and (Issued and
Share
and share
fully paid)
fully paid)
premium
premium
’000RM’000RM’000RM’000
At 1 January 2012, 31 December 2012
and 31 December 2013
The holders of ordinary shares are entitled to receive dividends as declared from time to time and are
entitled to one vote per share at general meetings of the Company. All ordinary shares rank equally with
regard to the Company’s residual assets.
101,225
101,225
16,526
117,751
28. RETAINED EARNINGS
Prior to the year assessment 2008, Malaysian companies adopt the full imputation system. In accordance
with the Finance Act 2007 which was gazetted on 28 December 2007, companies shall not be entitled to
deduct tax on dividend paid, credited or distributed to its shareholders, and such dividends will be
exempted from tax in the hands of the shareholders (“single tier system”). However, there is a transitional
period of six years, expiring on 31 December 2013, to allow companies to pay franked dividends to their
shareholders under limited circumstances. Companies also have an irrevocable option to disregard the
Section 108 balance and opt to pay dividends under the single tier system. The change in the tax legislation
also provides for the Section 108 balance to be locked-in as at 31 December 2008 in accordance with
Section 39 of the Finance Act 2007.
The Company did not elect for the irrevocable option to disregard the 108 balance. Accordingly, during the
transitional period, the Company may utilise the credit in the 108 balance to distribute cash dividend
payments to ordinary shareholders as defined under the Finance Act 2007. As at 31 December 2012, the
Company has sufficient credit in the 108 balance to pay franked dividends out of its entire retained
earnings. Any 108 balance which has not been utilised as at 31 December 2013 is disregarded. Thereafter,
the Company may distribute dividends out of its entire retained earnings under the single tier system.
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175
29. OTHER RESERVES
Group
At 1 January 2012
Other comprehensive income:
Employee
Foreign
share
currency
Fair value
option translationadjustment
reservereservereserve Total
RM’000RM’000RM’000RM’000
1,215(333)
– 882
value movement
At 31 December 2012
1,215 (864)(340)
11
At 1 January 2013
1,215 (864)(340)
11
At 31 December 2013
Company
At 1 January 2012
–
–
–
(531)
(340)
–
(340)
(531)
– –340340
–1,528
–1,528
1,215 664
(1,215)
–1,879
–
–(1,215)
–664
–664
1,215––
1,215
value movement
At 31 December 2012
1,215
–(340)875
At 1 January 2013
1,215
–(340)875
value movement
At 31 December 2013
–
–
–
(340)
(340)
–340340
1,215––
1,215
(1,215)
–
–(1,215)
––––
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Annual Report 2013
Notes to the
29. OTHER RESERVES (CONT’D.)
(a) Employee share option reserve
Employee share option reserve represents the equity-settled share options granted to employees (Note
30). The reserve is made up of the cumulative value of services received from employees recorded over
the vesting period commencing from the grant date of equity-settled share options, and is reduced by
the expiry or exercise of the share options. The ESOS has expired on 13 May 2013.
(b) Foreign currency translation reserve
The foreign currency translation reserve represents exchange differences arising from translation of the
financial statements of foreign operations whose functional currencies are different from that of the
Group’s presentation currency.
(c) Fair value adjustment reserve
Fair value adjustment reserve represents the cumulative fair value changes, net of tax, of available-forsale financial assets until they are disposed of or impaired.
30. EMPLOYEE SHARE OPTION SCHEME
The HeiTech Padu Employee Share Option Scheme (ESOS) is governed by the by-laws approved by the
shareholders at an Extraordinary General Meeting held on 18 June 2003.
The main features of the ESOS are as follows:
(a) The ESOS shall be in force from 30 July 2003 for ten offer periods allotted to eligible employees. The
ESOS has expired on 13 May 2013.
(b) Eligible employees are employees of the Group including executive directors who have been confirmed
in the employment of the Group for one continuous year of service and who fall within the eligibility
criteria as set out in the by-laws of the ESOS.
(c) The total number of ordinary shares of the Company offered and allotted under the ESOS shall not
exceed in aggregate 10% of the issued and paid up capital of the Company at any point of time
during duration of the ESOS or a maximum total 10,000,000 ordinary shares of RM1.00.
(d) The option price for each share shall be determined based on the weighted average market price of
the shares of the Company in the Daily Diary issued by the Bursa Malaysia Securities Berhad for the five
market days immediately preceding the date of offer, subject to a discount of 10% at the discretion of
the ESOS Committee but not less than the par value of the shares.
(e) The option may be exercised in full or such lesser number of ordinary shares provided the number of
shares shall be in multiples of 100 shares.
(f) Options granted under the ESOS carry no dividend or voting rights. Shares upon issuance and allotment
rank pari passu in all material respect with the existing ordinary shares of the Company.
(g)An executive director of the Company shall only be granted options under the ESOS upon the
shareholders of the Company having first approved his allocation of the option shares in a general
meeting.
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177
30. EMPLOYEE SHARE OPTION SCHEME (CONT’D.)
(h) Eligible employees to whom the options have been granted have no right to participate in any other
share issue of any other company within the Group.
(i) The number of option shares to be offered to an eligible employees under the ESOS shall be determined
at the discretion of the ESOS Committee but shall in no event exceed the Maximum Allowable Allotment.
The following table illustrates the number and weighted average exercise prices (WAEP) of, and movements
in, share options during the year:
Outstanding Number of share options
Outstanding Exercisable
at movements during the year
at
at
1 January
Exercised
Expired 31 December 31 December
’000’000’000’000’000
2013
2011 Options
Exercise Price RM1.00
2,546
–
(2,546)
–
–
2,085
–
(2,085)
–
–
2010 Options
Total
4,631–
(4,631)––
1.00––––
WAEP
2012
2011 Options
2,546
–
–2,5462,546
2,085
–
–2,0852,085
4,631
–
–4,6314,631
2010 Options
Total
WAEP
Details of share options outstanding at the end of the year:
1.00––––
2013
WAEP
RM
Exercise period
1.00
1.00
8 June 2011 – 13 May 2013
2 March 2010 – 13 May 2013
2011 options
2010 options
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Annual Report 2013
Notes to the
31. RELATED PARTY DISCLOSURES
(a) In addition to the related party information disclosed elsewhere in the financial statements, the following
significant transactions between the Group and related parties took place at terms agreed between
the parties during the financial year:
2013
RM’000
Group
Services provided to Permodalan Nasional Berhad (PNB),
a corporate shareholder of the Company:
– Network related services
Services provided to Amanah Saham Nasional Berhad,
a fund manager of PNB
Management fees to corporate shareholder of a subsidiary
Sales to a corporate shareholder of a subsidiary
Rental expenses of building to PNB
Company
Office rental receivable from subsidiaries
Rental expenses of building to PNB
2012
RM’000
(5,149)(4,829)
(19,520)(14,813)
–51
–(4,949)
4,4384,420
(280)(364)
4,4384,420
(b) Compensation of key management personnel
Key management personnel are those persons having authority and responsibility for planning, directing
and controlling the activities of the entity either directly or indirectly, including any director of the entity.
The remuneration of directors and other members of key management during the year was as follows:
Short-term employee benefits
Defined contribution plan
Company
2013201220132012
RM’000RM’000RM’000RM’000
3,1983,6982,9983,425
325378294346
3,5234,0763,2923,771
Included in the total key management personnel is:
Group
Directors’ remuneration (Note 7)
2013201220132012
RM’000RM’000RM’000RM’000
1,6992,0351,0811,730
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179
32.COMMITMENTS
(a) Capital commitments
Capital expenditure as at the reporting date is as follows:
Group and Company
Capital expenditure
Approved and contracted for:
Approved but not contracted for:
2013
RM’000
2012
RM’000
325532
52292
(b) Operating lease commitments – as lessee
The Group and the Company have entered into non-cancellable operating lease agreements for the
use of buildings. These leases have average life of between 2 to 10 years with renewal options and
right of first refusal included in the contracts. There are no restrictions placed upon the Company by
entering into these leases.
Future minimum rentals payable under non-cancellable operating leases (excluding land use rights) at
the reporting date are as follows:
Future minimum lease payments:
Later than 1 year and not later than
5 years
Later than 5 years
Group
Company
2013201220132012
RM’000RM’000RM’000RM’000
4,4424,4204,4424,420
18,33018,48218,33018,482
–4,290
–4,290
22,77227,19222,77227,192
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Annual Report 2013
Notes to the
32. COMMITMENTS (CONT’D.)
(c) Finance lease commitments
Group
Company
2013201220132012
RM’000RM’000RM’000RM’000
Minimum lease payments:
2 years
Later than 2 years and not later than
5 years
5,4075,4073,9473,947
Total minimum lease payments
Less: Future finance charges
8,35012,764 6,81510,763
(590)(1,111) (590)(932)
Present value of hire purchase liabilities
7,76011,653 6,2259,831
Analysis of present value of finance
lease liabilities:
2 years
Later than 2 years and not later than
5 years
Less: Amount due within 12 months
2,9434,3412,8683,947
–3,016
–2,869
4,6744,9533,6063,606
3,0863,9492,6193,606
–2,751
–2,619
7,76011,653 6,2259,831
(4,674)(4,953)(3,606)(3,606)
3,0866,7002,6196,225
Amount due after 12 months
The Group and the Company have entered into hire purchase agreements for motor vehicles and
equipment as disclosed in Note 13. The hire purchase payable bore effective interest rate of 1% (2012:
1%) per annum.
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181
33. FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES
The Group and the Company are exposed to financial risks arising from their operations and the use of
financial instruments. The key financial risks include credit risk, liquidity risk, interest rate risk, and foreign
currency risk.
The Board of Directors reviews and agrees policies and procedures for the management of these risks, which
are executed by the Group Chief Executive Officer and management. The audit committee provides
independent oversight to the effectiveness of the risk management process.
It is, and has been throughout the current and previous financial year, the Group’s policy that no derivatives
shall be undertaken except for the use as hedging instruments where appropriate and cost-efficient. The
Group and the Company do not apply hedge accounting.
The following sections provide details regarding the Group’s and Company’s exposure to the abovementioned financial risks and the objectives, policies and processes for the management of these risks.
(a) Credit risk
Credit risk is the risk of loss that may arise on outstanding financial instruments should a counterparty
default on its obligations. The Group’s and the Company’s exposure to credit risk arises primarily from
trade and other receivables. For the financial assets (including investments and cash and bank
balances), the Group and the Company minimise credit risk by dealing exclusively with high credit
rating counterparties.
The Group’s objective is to seek continual revenue growth while minimising losses incurred due to
increased credit risk exposure. The Group trades only with recognised and creditworthy third parties. It
is the Group’s policy that all customers who wish to trade on credit terms are subject to credit
verification procedures. In addition, receivable balances are monitored on an ongoing basis with the
result that the Group’s exposure to bad debts is not significant.
Exposure to credit risk
At the reporting date, the Group’s and the Company’s maximum exposure to credit risk is represented
by the carrying amount of each class of financial assets recognised in the statements of financial
position.
Credit risk concentration
At the reporting date, approximately 56% (2012: 70%) of the Group’s trade receivables were due from
public sector agencies in Malaysia.
Financial assets that are neither past due nor impaired
Information regarding trade and other receivables that are neither past due nor impaired is disclosed
in Note 21. Deposits with banks that are neither past due nor impaired are placed with or entered into
with reputable financial institutions with high credit ratings and no history of default.
Financial assets that are either past due or impaired
Information regarding financial assets that are either past due or impaired is disclosed in Note 21.
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Annual Report 2013
Notes to the
33. FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES (CONT’D.)
(b) Liquidity risk
Liquidity risk is the risk that the Group or the Company will encounter difficulty in meeting financial
obligations due to shortage of funds. The Group’s and the Company’s exposure to liquidity risk arises
primarily from mismatches of the maturities of financial assets and liabilities. The Group’s and the
Company’s objective is to maintain a balance between continuity of funding and flexibility through the
use of stand-by credit facilities.
The Group’s and the Company’s overall liquidity risk management is to maintain sufficient levels of cash
to meet its working capital requirements. In addition, the Group and the Company strive to maintain
available banking facilities at a reasonable level to its overall debt position. As far as possible, the
Group and the Company raise funding from shareholders, capital markets and financial institutions and
balance their portfolio with some short term funding so as to achieve overall cost effectiveness.
Analysis of financial instruments by remaining contractual maturities
The table below summarises the maturity profile of the Group’s and the Company’s liabilities at the
reporting date based on contracted undiscounted repayment obligations.
2013
RM’000
On demand
or within
one year
One to five
years
Total
Group
Financial liabilities:
104,180
–104,180
84,692108,616193,308
Total undiscounted financial liabilities
188,872108,616297,488
Company
120,044
–120,044
81,693 99,977181,670
201,737 99,977301,714
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183
(b) Liquidity risk (cont’d.)
Analysis of financial instruments by remaining contractual maturities (cont’d.)
2012
RM’000
On demand
or within
one year
One to five
years
Total
Group
91,242
124,021
–
95,152
91,242
219,173
215,263
95,152
310,415
Company
100,314
122,674
–
94,498
100,314
217,172
222,988
94,498
317,486
(c) Interest rate risk
Interest rate risk is the risk that the fair value or future cash flows of the Group’s and the Company’s
financial instruments will fluctuate because of changes in market interest rates.
The Group’s and the Company’s exposure to interest rate risk arises primarily from their loans and
borrowings. The Group’s and the Company’s policy is to manage interest cost using a mix of fixed and
floating rate borrowings.
Sensitivity analysis for interest rate risk
At the reporting date, if interest rates had been 10 basis points lower/higher, with all other variables
held constant, the Group’s profit net of tax would have been RM268,000 (2012: RM184,000) higher/
lower, arising mainly as a result of lower/higher interest expense on floating rate loans and borrowings,
higher/lower interest income from floating rate loans to related parties, and lower/higher positive fair
value of an interest rate swap. The assumed movement in basis points for interest rate sensitivity analysis
is based on the currently observable market environment.
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Annual Report 2013
Notes to the
(d) Foreign exchange risk
Foreign currency risk is the risk that the fair value or future cash flows of a financial instrument will
fluctuate because of changes in foreign exchange rates.
The Group has transactional currency exposure arising from sales or purchases that are denominated
in a currency other than the functional currency of the Group, RM. The foreign currencies in which these
transactions are denominated are mainly and Australian Dollar’s (“AUD”) and Indonesian Rupiah
(“IDR”).
The Group operates mainly in Malaysia and transacts predominantly in RM. As such, it is not materially
exposed to foreign exchange risk.
34. FAIR VALUE OF FINANCIAL INSTRUMENTS
A. Fair value of financial instruments by classes that are not carried at fair value and whose carrying
amounts are not reasonable approximation of fair value
Group
Company
CarryingFair
CarryingFair
Note
amountvalue
amountvalue
RM’000RM’000RM’000RM’000
2013
Financial asset
Other investments (non-current)
– Unquoted shares, at costs
17
6,312*
6,148*
25
79,21261,78979,21261,789
Financial liability
(non-current)
– Term loans
2012
Financial asset
Other investments (non-current)
– Unquoted shares, at costs
17
8,214
*
8,050
*
25
73,886
56,463
73,886
56,463
Financial liability
(non-current)
– Term loans
* Other investments (unquoted shares) carried at cost (Note 17)
Fair value information has not been disclosed for the Group’s investments in equity instruments that
are carried at cost because fair value cannot be measured reliably. These equity instruments mainly
represent ordinary shares in companies that are not quoted on any market. In addition, the variability
in the range of reasonable fair value estimates derived from valuation techniques is insignificant. The
Group does not intend to dispose of this investment in the foreseeable future.
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185
34. FAIR VALUE OF FINANCIAL INSTRUMENTS (CONT’D.)
B. Determination of fair value
Financial instruments that are not carried at fair value and whose carrying amounts are reasonable
approximation of fair value
The following are the classes of financial instruments that are not carried at fair value and whose
carrying amounts are reasonable approximation of fair value:
Note
Loans and borrowings (current)
Obligations under finance lease (current)
21
25
26
32(c)
The carrying amounts of these financial assets and liabilities are reasonable approximation of fair values
due to the relatively short-term nature.
The carrying amounts of loans and borrowings are reasonable approximation of fair value due to the
insignificant impact of discounting.
Quoted equity instruments
Fair value is determined directly by reference to their published market bid price at the reporting date.
The table below analyses financial instruments carried at fair value, by valuation method. The different
levels have been defined as follows:
2012
Note
Financial assets:
Available-for-sale financial assets:
– Equity instruments (quoted)
17
Level 1
RM’000
7,303
35. CAPITAL MANAGEMENT
The primary objective of the Group’s capital management is to ensure that it maintains a strong credit
rating and healthy capital ratios in order to support its business and maximise shareholder value.
The Group manages its capital structure and makes adjustments to it, in light of changes in economic
conditions. To maintain or adjust the capital structure, the Group may adjust the dividend payment to
shareholders, return capital to shareholders or issue new shares. No changes were made in the objectives,
policies or processes during the years ended 31 December 2013 and 2012.
The Group monitors capital using a gearing ratio, which is net debt divided by total capital plus net debt.
The Group’s policy is to keep the gearing ratio at reasonable level. The Group includes within net debt,
loans and borrowings, trade and other payables, less cash and bank balances.
page
HeiTech Padu Berhad
186
Annual Report 2013
Notes to the
35. CAPITAL MANAGEMENT (CONT’D.)
The debt to equity ratios as at 31 December 2013 and 31 December 2012 are as follows:
Group
Company
Note2013201220132012
RM’000RM’000RM’000RM’000
25
26
24
192,718218,062181,080216,240
104,18091,242
120,044100,314
(36,892)(73,005)(29,721)(71,075)
Less: Cash and bank balances
Net debt
260,006236,299271,403245,479
Equity attributable to owners of the
parent, represents total capital
175,672206,547153,775199,307
Capital and net debt
435,678442,846425,178444,786
Gearing ratio
60%53%64%55%
36. SEGMENT INFORMATION
For management purposes, the Group is organised into business units based on its products and services,
and has three reportable operating segments as follows:
I.
Information technology
II. Mailing and document processing services
III. Television content services. This segment has been disposed during the year (Note 11).
Except as indicated above, no operating segments have been aggregated to form the above reportable
operating segments.
Management monitors the operating results of its business units separately for the purpose of making
decisions about resource allocation and performance assessment. Segment performance is evaluated
based on operating profit or loss which, in certain respects as explained in the table below, is measured
differently from operating profit or loss in the consolidated financial statements. Group financing (including
finance costs) and income taxes are managed on a group basis and are not allocated to operating
segments.
Transfer prices between operating segments are at terms agreed between the parties during the financial
year.
page
www.heitech.com.my
187
36. SEGMENT INFORMATION (CONT’D.)
Geographical information
Geographically, management reviews the performance of the businesses in Malaysia, Australia and
Indonesia. Revenue information based on the geographical location of the operations of the Group are as
follows:
Group
2013
RM’000
2012
% of total
RM’000
% of total
By country:
Malaysia
Australia
Indonesia
403,06797%385,668
97%
3,9631%2,505 1%
6,7882%7,356 2%
413,818100%395,529
Information
technology
Mailing and
document
processing services
Television content
services
(Discontinued)
Adjustments and
eliminations
100%
Per consolidated
20132012201320122013201220132012
Notes20132012
RM’000RM’000RM’000RM’000RM’000RM’000RM’000RM’000 RM’000RM’000
Restated
Revenue:
External sales
Other income
Inter-segment
379,125366,377 34,69329,152 404,950 (40) (4,950) 413,818395,529
14,91811,517 340506 –6
(5,357)
(6) 9,90112,023
276,914302,569
–1,711
––
(276,914)(304,280) A
––
670,957680,463 35,03331,369
Total revenue
404,956
(282,311)(309,236)
423,719407,552
Results:
Finance costs
Interest income
Depreciation and
amortisation
Other non-cash
expenses
Share of results of
associates
(Loss)/profit before
tax
(6,788)(5,346) (475)(104) (4)(4) 4
460633 1485 –6–
4 (7,263)(5,450)
(6)
474718
(6,427)(9,974)(2,457)(1,922)
(11)(20) 11
20 (8,884)(11,896)
(13,252)(5,100)(1,160)– –––
–B (14,412)(5,100)
–1,762
–––(747)652
747
6521,762
(31,013)11,429 2,5122,912(4,240)(499)1,303 (5,906)C (31,438)7,936
page
HeiTech Padu Berhad
188
Annual Report 2013
Notes to the
Information
technology
Mailing and
document
processing services
Television content
services
(Discontinued)
Adjustments and
eliminations
Per consolidated
20132012201320122013201220132012
Notes20132012
RM’000RM’000RM’000RM’000RM’000RM’000RM’000RM’000 RM’000RM’000
Restated
Assets:
Investment in
associates
Additions to noncurrent assets
Segment assets
4,0973,445
–––3,114
– (3,114)
4,0973,445
11,43428,932 2,057––31 –
(31)D 13,49128,932
509,136552,749 59,65534,342
–13,688(88,504)(72,258)E 480,287528,521
Liabilities:
Segment liabilities
324,794339,038 25,8718,456
–817
(50,434)(36,581)F 300,231311,730
Notes Nature of adjustments and eliminations to arrive at amounts reported in the consolidated
financial statements.
A
Inter-segment revenues are eliminated on consolidation.
B
Other material non-cash expenses consist of the following items as presented in the respective notes
to the financial statements:
Note 2013 2012
RM’000RM’000
Impairment loss on available-for-sale financial assets
Impairment loss on trade and other receivables
Reversal of impairment loss on receivables
Net loss on remeasurement to fair value of retained
interest in a former associate
Impairment loss on investment in a former associate
9
9
9
9
9
C
–2,140
–3,427
14,4125,100
The following items are added to/(deducted from) segment profit to arrive at “(loss)/profit before
tax from continuing operations” presented in the consolidated statement of comprehensive income:
1,878809
13,9324,877
(1,398)(6,153)
Revenue from intersegment
Expenses from intersegment
Profit before tax, discontinued operation
2013 2012
RM’000RM’000
(5,357)(4,301)
6,008(3,866)
6521,762
–499
1,303(5,906)
www.heitech.com.my
page
189
Notes Nature of adjustments and eliminations to arrive at amounts reported in the consolidated
financial statements.
D
Additions to non-current assets consist of:
Intangible assets
E
2013 2012
RM’000RM’000
7,34018,941
6,1519,991
13,49128,932
The following item is deducted from segment assets to arrive at total assets reported in the
consolidated statement of financial position:
2013 2012
RM’000RM’000
Inter-segment assets
(88,504)(72,258)
F
The following item is deducted from segment liabilities to arrive at total liabilities reported in the
consolidated statement of financial position:
2013 2012
RM’000RM’000
(50,434)(36,581)
Inter-segment liabilities
37. AUTHORISATION OF FINANCIAL STATEMENTS FOR ISSUE
The financial statements for the year ended 31 December 2013 were authorised for issue in accordance
with a resolution of the directors on 17 April 2014.
page
HeiTech Padu Berhad
190
Annual Report 2013
Notes to the
38. SUPPLEMENTARY INFORMATION – BREAKDOWN OF RETAINED EARNINGS INTO REALISED AND UNREALISED
The breakdown of the retained earnings of the Group and of the Company as at 31 December 2013 into
realised and unrealised profits is presented in accordance with the directive issued by Bursa Malaysia
Securities Berhad dated 25 March 2010 and prepared in accordance with Guidance on Special Matter No.
1, Determination of Realised and Unrealised Profits or Losses in the Context of Disclosure Pursuant to Bursa
Malaysia Securities Berhad Listing Requirements, as issued by the Malaysian Institute of Accountants.
Group
Company
2013201220132012
RM’000RM’000RM’000RM’000
RestatedRestated
Total retained profits of the Company
and its subsidiaries
– Realised
– Unrealised
32,46381,63435,44080,097
(907)(417) 584584
Total share of retained profits from associate
– Realised
31,55681,21736,02480,681
Less: Consolidation adjustments
35,65384,66236,02480,681
21,6044,123
––
57,25788,78536,02480,681
Retained profits as per financial statements
4,0973,445
––
other
information
192 List of Properties
193 Analysis of Shareholdings
Form of Proxy
page
192
HeiTech Padu Berhad
Annual Report 2013
LIST OF
PROPERTIES
AS AT 31 DECEMBER 2013
Land/
Build-up
Area
Current
Usage
Land/
Tenure
Net Book
Value as at
31.12.2012
Date of
Revaluation
Location
Description
No. 1
Jalan U8/81,
Seksyen U8,
Bukit Jelutong,
40150 Shah
Alam,
Selangor Darul
Ehsan
HS (D) 142708,
P.T. No. 17653,
Mukim Damansara,
Daerah Petaling,
Selangor Darul
Ehsan
210,830.4
Sq. Ft.
HeiTech
Village 2
World Class
Data Center
and business
premise
Freehold
RM7.38
Million
7 March
2013
Cyberjaya
HS (D) 7091
P.T. No. 12105,
Mukim Dengkil,
Daerah Sepang,
Selangor Darul
Ehsan
0.4815
hectares
Vacant Land
Freehold
RM2.52
Million
6 July 2004
page
www.heitech.com.my
193
ANALYSIS OF
SHAREHOLDINGS
AS AT 29 APRIL 2014
ANALYSIS BY SIZE OF HOLDINGS AS AT 29 APRIL 2014
Size of Holdings
1 – 99
100 – 1,000
1,001 – 10,000
10,001 – 100,000
100,001 – 5,061,264
5,061,265 and above
Total
No of
Shareholders/
Depositors
216
443
1,772
485
58
2
2,976
Holder
Percentage
7.2581
14.8858
59.543
16.297
1.9489
0.0672
100
No of Shares/
Securities
9,532
333,360
6,957,198
14,614,332
21,101,378
58,209,500
101,225,300
Holding
Percentage
0.0094
0.3293
6.873
14.4374
20.846
57.5049
100
Note:
* Stock name/Code = HTPADU/5028
* Total Issued Capital = 101,225,300 (INCLUDING Treasury Shares of 100)
* No Consolidation of Accounts
INFORMATION ON SUBSTANTIAL SHAREHOLDERS/DEPOSITORS AS AT 29 APRIL 2014
No
1
2
Name
PERMODALAN NASIONAL BERHAD
ABB NOMINEE (TEMPATAN) SDN BHD
PLEDGED SECURITIES ACCOUNT FOR PADUJADE
CORPORATION SDN BHD
Total
ID Number
038218X
37645P
No of Shares/
Securities
27,879,500
30,330,000
Holding
Percentage
27.5421
29.9629
58,209,500
57.5049
Note:
* Total Issued Capital = 101,225,200 (EXCLUDING Treasury Shares of 100)
Remarks:
Kindly take note that you need to disclose the holdings of holders/depositors according to the register of substantial holders maintain in
accordance with Section 69L of the Companies Act, 1965.
INFORMATION ON DIRECTORS’ SHAREHOLDINGS/SECURITIES AS AT 29 APRIL 2014
No
1
2
3
4
5
6
7
8
Name of Directors
ABI MUSA ASA’ARI BIN MOHAMED NOR
GHAZALI BIN AWANG
MOHAMED ARIFFIN BIN ATON
MOHD FADZLI BIN YUSOF
MOHD HILMEY BIN MOHD TAIB
No of Shares/
Securities
0
0
0
0
7,820,184
0
12,500
0
7,832,684
Note:
# Account under nominees
Remarks:
The above information reflect Shares/Securities registered directly in the name of the Directors (as shareholders/depositors) only.
Kindly take note that you need to adjust the Directors' Shares/Securities in Table A according to information maintained by you in the
Register of Directors' Shareholdings/Securities holdings, as we are not privy to such information and at the figures in the respective
shareholding range accordingly.
page
HeiTech Padu Berhad
194
Annual Report 2013
Analysis of
Shareholdings
as at 29 April 2014
LIST OF TOP THIRTY (30) SHAREHOLDERS/DEPOSITORS AS AT 29 APRIL 2014
No
Name
Shares
%
1
PLEDGED SECURITIES ACCOUNT FOR PADUJADE CORPORATION SDN BHD
30,330,000
29.9629
2
PERMODALAN NASIONAL BERHAD
27,879,500
27.5421
3
ABB NOMINEE (TEMPATAN) SDN BHD PLEDGED SECURITIES ACCOUNT FOR
MOHD HILMEY MOHD TAIB
4,465,400
4.4114
4
1,700,300
1.6797
5
1,334,484
1.3183
6
KOPERASI PERMODALAN FELDA MALAYSIA BERHAD
1,320,600
1.3046
7
SAFIEE BIN MOHAMMAD
1,012,045
0.9998
8
PERBADANAN USAHAWAN NASIONAL BERHAD
894,889
0.8841
9
IZANEE BIN ISMAIL
600,900
0.5936
10
WAN ZAIDI BIN WAN JAAFAR
500,795
0.4947
11
CARTABAN NOMINEES (TEMPATAN) SDN BHD
AXA AFFIN GENERAL INSURANCE BERHAD
375,000
0.3705
12
KAMSIAH BINTI ABU
360,190
0.3558
13
CHE NGAH BIN IBRAHIM
339,681
0.3356
14
320,000
0.3161
15
GOH SIANG GIANG
305,000
0.3013
16
JASMI BIN MOHD ISMAIL
304,300
0.3006
17
MAYBANK NOMINEES (TEMPATAN) SDN BHD
KOO TAI PING @ KOH KIAN TEE
286,900
0.2834
18
CIMSEC NOMINEES (TEMPATAN) SDN BHD
PLEDGED SECURITIES ACCOUNT FOR CHANG LEE LEE (PENANG-CL)
282,400
0.279
19
CHENG MEI WAN
261,000
0.2578
20
MARIAM BINTI HARON
252,405
0.2493
21
LIM YOON CHE
246,174
0.2432
22
R N MUTHURAJAH
225,000
0.2223
23
TA NOMINEES (TEMPATAN) SDN BHD
PLEDGED SECURITIES ACCOUNT FOR PHUA LEE PING
220,800
0.2181
24
LIM KHENG GUAN
220,000
0.2173
25
LEE HUONG SING
218,500
0.2159
26
HDM NOMINEES (TEMPATAN) SDN BHD
PLEDGED SECURITIES ACCOUNT FOR CHANG CHEE KOON (M03)
210,000
0.2075
27
YEOH POH LEE
206,800
0.2043
28
LEE OI KUM
205,000
0.2025
29
PADUJADE CORPORATION SDN BHD
191,028
0.1887
30
NG WANG @ NG CHIANG CHIN
190,700
0.1884
75,259,791
74.3489
Total
Note:
FORM OF
PROXY
CDS Account
HeiTech Padu Berhad (310628-D)
No. of shares
I/We
(FULL NAME IN BLOCK CAPITALS)
of
(FULL ADDRESS)
being (a) member(s) of HEITECH PADU BERHAD (310628-D), hereby appoint(s)
IC No.
of
or failing him
IC No.
of
or failing him/her, the Chairman of the meeting as my/our proxy to attend and vote for me/us on my/our behalf
at the Nineteenth (19th) Annual General Meeting of the Company to be held at Ballroom Selangor 1, Grand
Dorsett Subang Hotel, Jalan SS12/1, 47500 Subang Jaya, Selangor Darul Ehsan, Malaysia on Monday, 23 June
2014, at 10.30 a.m. or any adjournment thereof.
The proxy is to vote on the resolutions set in the Notice of Meeting as indicated with an ‘X’ in the appropriate
space below. If no specific direction as to voting is given, the proxy will vote or abstain at his discretion.
RESOLUTIONS
RESOLUTION 1
RESOLUTION 2
RESOLUTION
RESOLUTION
RESOLUTION
RESOLUTION
RESOLUTION
3
4
5
6
7
RESOLUTION 8
RESOLUTION 9
RESOLUTION 10
RESOLUTION 11
RESOLUTION 12
Dated this
FOR
2014
Notes:1. A Member entitled to attend and vote at the Annual General
Meeting is entitled to appoint a proxy or proxies to attend and
vote in his/her stead. A proxy may but need not be a member of
the Company.
2. A Member is entitled to appoint up to two (2) proxies to attend
and vote in his/her place. Where a member appoint up to two
(2) proxies, the appointments shall be invalid unless he/she
specifies the proportions of his/her holdings to be represented by
each proxy.
AGAINST
To receive and adopt the Audited Financial Statements of the
Company for the financial year ended 31 December 2013
together with the Reports of the Directors and Auditors
To re-elect YBhg. Tan Sri Dato’ Sri Abi Musa Asa’ari bin
Mohamed Nor as Director
To re-elect YBhg. Dato’ Mohd Fadzli bin Yusof as Director
To re-elect Tuan Haji Ghazali bin Awang as Director
To re-elect Mr. Sulaiman Hew bin Abdullah as Director
To re-elect Puan Wan Ainol Zilan binti Abdul Rahim as Director
To retain Tuan Haji Ghazali bin Awang as an Independent
Director
To retain YBhg. Dato’ Mohd Fadzli bin Yusof as an Independent
Director
To approve the payment of Directors’ fees for the financial year
ended 31 December 2013
To re-appoint Messrs. Hanafiah Raslan and Mohamad as
Auditors for the ensuing year and to authorise the Directors to fix
the remuneration of the Auditors
To approve the Proposed authority to Issue Shares
To approve the Proposed Renewal of Shareholders’ Mandate for
Recurrent Related Party Transactions of Revenue or Trading Nature
Provided however, where a Member is an authorised nominee as
defined in accordance with the provisions of the Securities Industry
(Central Depositories) Act, 1991, he/she may appoint up to two
Signature of Member or Affix Common Seal
(2) proxies in respect of each Securities Account he/she holds
with ordinary shares in the company standing to the credit of the
Securities Account.
3. Where the appointment is executed by a corporation, it must be
either under its Common Seal or the hand of its officer or attorney
duly authorised.
4. The instrument appointing a proxy and the power of attorney or
other authority (if any) under which it is guided or notarially
certified copy of such power or authority, must be deposited at
the office of the Company’s Registrar: EQUINITI SERVICES SDN BHD,
at Level 8, Menara MIDF, 82 Jalan Raja Chulan, 50200 Kuala
Lumpur, not less than forty-eight (48) hours before the time
appointed for holding the Meeting or at any adjournment thereof.
Your details are being protected under our data protection and privacy effort.
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AFFIX STAMP
Equiniti Services Sdn. Bhd.
(formerly known as MIDF Consultancy and
Corporate Services Sendirian Berhad)
Level 8, Menara MIDF
82 Jalan Raja Chulan
50200 Kuala Lumpur
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