Asian Micro

ASIAN MICRO HOLDINGS LIMITED
Growing Our Green Potential
AnnuAl RepoRt
2011
CONTENTS
01 Corporate Information 02 Corporate Profile 04 Chairmans Message 06 Board of Directors 08 Key Management 09 Financial Highlights 11 Report on Corporate Governance 20 Directors Report 26 Statement by Directors 27 Independent Auditors Report 29 Balance Sheets 31 Consolidated Statement of Comprehensive Income 32 Statements of Changes in Equity 35 Consolidated Cash Flow Statement 37 Notes to the Financial Statements 93 Statistics of Shareholdings 94 Shareholders Information 95 Notice of Annual General Meeting Proxy Form
This annual report has been prepared by the Company and its contents have been reviewed by the Companys sponsor (Sponsor), Asian Corporate Advisors Pte. Ltd. for compliance with the relevant rules of the Singapore Exchange Securities Trading Limited (SGX-ST). The Companys Sponsor has not independently verified the contents of this annual report including the correctness of any of the figures used, statements or opinions made. This annual report has not been examined or approved by the SGX-ST and the SGX-ST assumes no responsibility for the contents of this annual report including the correctness of any of the statements or opinions made or reports contained in this annual report. The contact person for the Sponsor is Mr. Liau H.K. Telephone number: 6221 0271
Corporate InformatIon
Board of directors
Executive Lim Kee Liew @ Victor Lim CEO and Group Managing Director Lin Xianglong Winchester Executive Director Ng Chee Wee Executive Director and Group Financial Controller Non-Executive Dr. Wang Kai Yuen Non-Executive Chairman Teo Kio Choon @ Chang Chiaw Choon Independent Director Chue Wai Tat Independent Director
remuNeratioN committee
Dr. Wang Kai Yuen Chairman
Teo Kio Choon @ Chang Chiaw Choon Chue Wai Tat
compaNy secretary
Lee Ellen
registered aNd BusiNess office

1 Tech Park Crescent Tuas Tech Park Singapore 638131 Tel: 6862 7777 / Fax: 6862 6277 Website: http://www.asianmicro.com.sg
BaNkers
audit committee
Dr. Wang Kai Yuen Chairman
Malayan Banking Berhad United Overseas Bank Limited
share registrar
Teo Kio Choon @ Chang Chiaw Choon Chue Wai Tat
B.A.C.S. Private Limited 63 Cantonment Road Singapore 089758
NomiNatiNg committee
coNtiNuiNg spoNsor
Teo Kio Choon @ Chang Chiaw Choon Chairman Dr. Wang Kai Yuen Chue Wai Tat
Asian Corporate Advisors Pte Ltd 112 Robinson Road #03-02 Singapore 068902
auditors
Ernst & Young LLP One Raffles Quay North Tower Level 18 Singapore 048583 Partner-in-charge: Philip Ling (Since financial year ended 30 June 2011)
Annual Report 2011
a s i a N m i c ro hoL diNgs L im it ed
2 Asian Micro Holdings Limited
Corporate profIle
Asian Micro Holdings Limited (listed in the SGX-SESDAQ in September 1999), provides Compressed Natural Gas (CNG) supply related products & services. The Groups secondary core business is in recycling and precision cleaning of packaging trays and media/disk cassettes used in the hard disk drive and semiconductor industries in Singapore and Thailand. The Group is also serving these industries with clean room grade plastic packaging bags and materials for packaging cleaned finished products. The Group is supplying CNG skids which are used for storing and transporting CNG to the local industries for gas cutting, heat treatment and power generation. It can also be used for powering of natural gas engines, and off-the-road vehicles. The Group continually explores innovative methods of introducing industrial consumers to the use of natural gas and energy saving methods. Our customers are namely from the oil and gas, marine and offshore, aviation, shipyard and manufacturing industries. The Group provides natural gas as an alternative fuels which is gaining popularity in the shipyard industries to be used for steel gas cutting, natural gas to the industries for powering up power generator to reduce electricity cost. The Group also imports, sells or leases specialized vehicles like CNG prime movers, CNG tractors and CNG forklifts which cut down CO2 emission, reduces pollutants PM2.5 and many other hazardous hydrocarbon emissions. The Group will embark on growth on energy related business and strive to add value to customers, shareholders and its staff.
Annual Report 2011
CHaIrmanS meSSaGe
On behalf of the Board of Directors, I am presenting the Annual Report and the Audited Financial Statements of Asian Micro Holdings Limited and its subsidiaries for the financial year ended 30 June 2011. Dr. Wang Kai Yuen, Chairman
fiNaNciaL performaNce For FY 2011, the Groups consolidated revenue decreased 59% or S$12.1 million from S$20.7 million in FY 2010 to S$8.6 million in FY 2011. The decrease in revenue is mainly due to the decrease in sales of Natural Gas Vehicles (NGV) in Thailand, cessation of several businesses in China and decrease in sales of plastics bag manufacturing, partially offset by the infrastructure project which the Group has secured with one major industrial aviation customer. FY 2011 remained competitive for the Group as the global export market for storage devices was badly affected by the drop in demands for the hard disk drives (HDD). This ultimately affected our cleaning service and clean room plastic packaging bags manufacturing business. However, our effort to develop a new business based on clean energy has paid off. The Group has secured a contract with one major industrial aviation customer for the Compressed Natural Gas (CNG) downloading infrastructure project and the supply of CNG. Net loss attributable to shareholders after taking into consideration of taxation and minority interest amounted to S$3.9 million or an increase of 29% compared to the net loss of S$3.0 million in FY 2010. The net loss incurred in FY 2011 is mainly due to weakening of United States Dollar and Thailand Baht against Singapore Dollar and allowance for stocks obsolescence. The poor performance of tray cleaning business which was affected by the HDD downturn has resulted in the disposal of our subsidiaries in the second half of FY 2011. We believe that, with the closure of non-profitable companies, we would be able to reduce our losses and operate more efficiently to improve the Groups results.
CHaIrmanS meSSaGe
LookiNg ahead The precision tray cleaning segment in the HDD business will remain challenging and the Group will continue its cost cutting effort to render all the subsidiaries profitable. The Group has renewed a 2-year agreement with its major customer to provide tray washing and transport and logistical support service in Thailand. The Group will also upgrade its plastic bag manufacturing machineries progressively to ensure its quality so as to obtain more orders from our major customers. The Group will continue to promote the use of natural gas in the manufacturing and service industries for the purposes of gas cutting, heat treatment processes, powering of natural gas tractors and electrical power generation in the marine and offshore industries. The Group had secured a contract with one major industrial aviation customer for the supply of natural gas over a period of up to 5 years and one major shipyard customer in the construction of CNG cylinders storage skids and pressure regulating system skids for the gas-cutting activities. We will continue to improve on our business strategies to generate new sources of revenue and earnings for the Group, thereby enhancing shareholders value in the long run. corporate goverNaNce The Group remains committed to maintaining our regime of high standards of corporate governance. We pledge to provide timely and accurate information through announcements and investor relations activities for the benefits of all stakeholders. appreciatioN On behalf of the Board, I would like to thank all shareholders for their continued loyalty and support to the Company despite the continued losses. We also acknowledge the strong support of our customers, bankers and business associates of our Company in 2011 and we are looking forward to your strong support to help us to achieve a better 2012 and beyond. Last, but not least, I would like to thank all staff and management for their dedicated service and sacrifice in FY 2011 and hope that FY 2012 will yield better results.
dr. Wang kai yuen Chairman 30 September 2011
Annual Report 2011
BoarD of DIreCtorS
D C A
E F B
BOARD OF DIRECTORS
A. Dr. WAng KAi Yuen Dr. Wang Kai Yuen was appointed as the Independent Non-Executive Chairman of the Group on 26 August 2006. He had been an Independent Director of the Group since 1999. He is also the Chairman of the Companys Audit and Remuneration Committees and a member of the Nominating Committee. He retired as Managing Director of Fuji Xerox Singapore Software Centre in December 2009. He holds several other directorships including directorships in ComfortDelGro Corporation Limited, COSCO Corporation (Singapore) Ltd, Hiap Hoe Ltd, HLH Ltd, EOC Ltd, SuperBowl Holdings Ltd, Xpress Holdings Ltd, Ezion Holdings Ltd, Matex International Ltd, A-Sonic Aerospace Ltd and China Aviation Oil (Singapore) Corporation Ltd. Dr. Wang holds a Bachelor of Engineering (Electrical Engineering) (Hons) from the University of Singapore and a Masters of Science (Industrial Engineering), a Masters of Science (Electrical Engineering) and a PhD (Engineering) from Stanford University, USA. B. Mr. liM Kee lieW @ Victor liM Mr. Lim Kee Liew @ Victor Lim is the Chief Executive Officer and Group Managing Director of the Company. Victor Lim is the key founder of the Group and currently provides the overall strategic direction and policy decisions of the Group. Prior to setting up the Group, Victor Lim was the Engineering Support Manager in Micropolis Singapore Ltd (a producer of high capacity Hard Disk Drives) from 1983 to 1989. Victor Lim holds a Diploma in Production Engineering from the Singapore Polytechnic and has more than 25 years experience in the electronic and hard disk drive industry. c. Mr. chue WAi tAt Mr. Chue Wai Tat was appointed as an Independent Non-Executive Director of the Company in July 2011. He started his career with the Inland Revenue Department (now known as Inland Revenue Authority of Singapore) for 10 years before joining the private sector. He has accumulated more than 20 years of experience, mainly in senior finance position in MNC and GLC such as Group/Regional/Controller of MNC (Universal Furniture, Seagate Technology, Asia Pacific Resources International Ltd) and VP Group Finance of Media Corporation of Singapore Pte Ltd, before retiring on 31 December 2009. Since March 2011, he has taken up a retirement position with Boxson Packaging Industries Pte Ltd, an SME, assisting in its accounting and administration. Mr. Chue holds a Bachelor of Social Science (Economics & Political Science) (Hons) from the University of Singapore. He was qualified and admitted as a Fellow member of the Association of Chartered Certified Accountants (ACCA) and a non-practicing Fellow member of the Institute of Certified Public Accountants of Singapore (ICPAS). D. Mr. teo Kio choon @ chAng chiAW choon Mr. Teo Kio Choon @ Chang Chiaw Choon is an Independent Non-Executive Director of the Company since 1999. He is also the Chairman of the Groups Nominating Committee and a member of the Audit and Remuneration Committees. He is a partner of KC Teo Consultants, a management consultancy firm since 1992. Mr. Chang holds a Bachelor of Science (Hons) degree from the Nanyang University. e. Mr. ng chee Wee Mr. Ng Chee Wee joined the Group in August 2010 as Group Financial Controller and was appointed as an Executive Director of the Company in May 2011. He has the overall responsibility for the Groups finance, accounting, treasury, legal and tax functions. Mr. Ng has more than 10 years experience in the accounting and finance fields for various industries. He holds a Diploma with Merit in Accountancy from Ngee Ann Polytechnic in Singapore and completed the Association of Chartered Certified Accountants course in 2000. He is a Fellow member of the Association of Chartered Certified Accountants (ACCA) and a nonpractising member of the Institute of Certified Public Accountants of Singapore (ICPAS). F. Mr. lin XiAnglong Winchester Mr. Lin Xianglong Winchester was appointed as an Executive Director of the Company in August 2011. He is the Deputy Managing Director for the Groups Natural Gas Vehicle (NGV) related business division in Thailand. He is also the overall responsible person for marketing department for the Groups business activities in Singapore and Thailand. Besides overseeing the operation of the CNG conversion centres in Thailand, he is now responsible for the Clean Room packaging materials business for the Hard Disk Drive industries (HDD) in Singapore and Thailand. Prior to this, Winchester Lin joined the Group as a Sales Executive in June 2007 and was subsequently promoted to Business Development Manager in September 2008 and Deputy Managing Director in October 2008. He holds a Diploma in Marketing from Nanyang Polytechnic.
Winchester Lin is the son of the CEO and Group

Managing Director, Victor Lim.
Annual Report 2011
KeY manaGement
ms. LeoNg Lai heNg Ms. Leong Lai Heng was an Executive Director of the Company since February 1997 and has resigned from the Board in August 2011. She is currently working as an advisor for the Company and director of the subsidiaries. She is the spouse of the CEO and Group Managing Director, Victor Lim, and mother of the Executive Director, Lin Xianglong Winchester. mr. Lim see Wai Mr. Lim See Wai is the Assistant Engineering Director for AM NGV (S) Pte Ltd. He is responsible for the development and expansion of CNG-related projects and has more than 3 years experience in this field. He joined the company as a Mechanical Engineer and was subsequently promoted to Project Development Manager in October 2008 and Assistant Engineering Director in October 2009. He holds a Bachelors degree in Mechanical Industry Engineering (IE) from University Technology Malaysia (UTM). mr. Ng cher Lek Mr. Ng Cher Lek is the Production Manager for ACI Industries Pte Ltd. He is responsible for the cleaning and recycling operations in Singapore and supporting the Deputy Managing Director for business development and sales. He has more than 20 years of manufacturing experience in the hard disk drive and semiconductor industries in various operational departments and holding positions of Production/Manufacturing Manager, Senior Engineering Manager & Senior Operation Manager. He holds a Diploma in Mechanical Engineering from Singapore Polytechnic and a Diploma in Management Studies from SIM. ms. yaNg Lei Ms. Yang Lei is the Group Accountant responsible and overseeing the groups accounting, financial and tax functions. She has 10 years experience in accounting and finance fields for various industries. She holds a Bachelor of Science in Applied Accounting (Hons) from the Oxford Brookes University and completed the Association of Chartered Certified Accountants course in 2003. She is a member of the Association of Chartered Certified Accountants (ACCA) and a non-practising member of the Institute of Certified Public Accountants of Singapore (ICPAS). mr. mavet aNg Mr. Mavet Ang is the Sales and Marketing Executive for ACI Industries Pte Ltd. He is responsible for the marketing and operation for the manufacturing of the Clean Room PE Bags for the Hard Disk Drive industries (HDD) and other industries. Besides overseeing the operation, he is also responsible for the business development of the Company. He joined the Company as a Customer Service Officer and was subsequently re-designated to the current position.
fInanCIal HIGHlIGHtS
2007 S$000 ( restated) resuLts of operatioN Turnover Profit / (Loss) before taxation and non-controlling interest Taxation Profit / (Loss) from discontinued operation, net of tax Profit / (Loss) after taxation but before non-controlling interest Attributable to : Owners of the parent Non-controlling interest fiNaNciaL positioN Fixed Assets Goodwill on Acquisition Investment Property Associated Company Current Assets Current Liabilities Net Current Assets Non Current Liabilities represeNtiNg Shareholders Equity Non-controlling interest EPS before Taxation (S$cents) EPS after Taxation & NCI (S$cents) NTA per Share (S$cents) 12,576 306 0.49 0.52 4.00 12,204 404 (1.59) (1.59) 3.66 4,888 250 (2.17) (2.17) 1.45 1,997 170 (0.83) (0.84) 0.60 1,197 (419) (1.00) (0.96) 0.17 9,464 752 2,600 469 10,993 (8,515) 2,478 (2,881) 5,183 3,200 353 12,198 (6,576) 5,622 (1,750) 2,066 326 7,953 (5,023) 2,930 (184) 1,716 6,602 (6,047) 555 (105) 1,098 4,177 (4,028) 149 (469) 1,679 (125) (5,445) (187) (7,499) (171) (3,023) (58) (3,897) (532) 14,584 (777) (41) 2,372 1,554 21,115 (5,496) 9 (145) (5,632) 12,113 (7,678) 8 (7,670) 20,704 (3,011) (70) (3,081) 8,575 (4,640) 211 (4,429) 2008 S$000 2009 S$000 2010 S$000 (reclassified) 2011 s$000
Annual Report 2011
fInanCIal HIGHlIGHtS
turNover
(S$000)
turnover by region (S$000)

Singapore 7,100 1,118 357 8,575
20,704
14,584
12,113
21,115
8,575
Thailand China/HK
Thailand 1,118
China/HK 357
2011
2010
2009
2008
2007
Net profit (Loss) attriButaBLe to sharehoLders (S$000)
Singapore 7,100
turnover by business activities (S$000)

Tray recycling Manufacturing 3,483 2,014 183 2,895 8,575
2011
2010
2009
2008
2007
1,679
Plastic waste recycling NGV related
NGV related 2,895

3,897 3,023 7,499 5,445
Tray recycling 3,483
Plastic waste recycling 183
Manufacturing 2,014
REPORT ON CORPORATE GOVERNANCE

Asian Micro Holdings Limited (the Company) recognizes the importance of corporate governance and is committed to uphold the high standards of corporate governance, and to put in place effective self-regulatory corporate practices to preserve and enhance long term shareholders value. This report outlines the Companys corporate governance practices with specific reference to the Code of Corporate Governance 2005 (the Code).
BOARD MATTERS
Principle 1 Boards Conduct of its Affairs
The Board meets regularly, both formally and informally, and as frequent as warranted by particular circumstances. The principal functions of the Board, apart from its statutory responsibilities are: (a) to approve the Groups corporate policies, financial objectives and direction of the Group and monitoring performance of management; to approve annual budgets, key operational issues, major funding and investment proposals; to set overall strategies and supervision of the Groups business and affairs; to review the financial performance of the Group; to approve nominations of Directors and appointment to the various Board committees and key managerial personnel; and to assume responsibility for corporate governance.
(b) (c) (d) (e)
(f)
The Board discharges its responsibilities either directly or indirectly through the various Board committees. The Board delegates the formulation of business policies and day-to-day management to the Chief Executive Officer. The Board conducts regular scheduled meetings. In the financial year under review, the Board met twice. Ad-hoc meetings are convened as and when required. The Articles of Association of the Company allows a Board Meeting to be conducted by way of a tele-conference or any other electronic means of communications. The attendance of Directors at meetings of the Board and Board committees, as well as the frequency of such meetings, is disclosed in this report. A formal letter of appointment is provided to all new Directors. The letter indicates the amount of time commitment required and the scope of duties. The Company has adopted a policy that welcomes the Directors to request for further explanations, briefings or informal discussions on any aspect of the Companys operations or businesses from the Management. Newly appointed Directors will receive appropriate training and orientation programmes to familiarize themselves with the operations of the Company and its major business processes. The Management monitors changes to regulations and accounting standards closely. To keep pace with accounting, legal, industry specific knowledge and regulatory changes, where these changes have an important bearing on the Company or Directors disclosure obligations, Directors are briefed either during Board meetings or at specially convened sessions.
Annual Report 2011
11

Principle 2 Board Composition and Balance
Currently, the members of the Board are: Executive Directors Mr. Lim Kee Liew @ Victor Lim (Chief Executive Officer & Group Managing Director) Mr. Lin Xianglong Winchester (Executive Director) (Appointed on 24 August 2011) Mr. Ng Chee Wee (Executive Director & Group Financial Controller) (Appointed on 6 May 2011) Independent Non-Executive Directors Dr. Wang Kai Yuen (Chairman) Mr. Teo Kio Choon @ Chang Chiaw Choon Mr. Chue Wai Tat
(Appointed on 6 July 2011)
The Nominating Committee is of the view that the current Board comprises Directors who, have the appropriate mix of diversity, expertise and experience, and collectively possess the necessary core competencies for effective functioning and informed decision-making. The Board has reviewed its composition of Directors and is satisfied that such composition is appropriate for the nature and scope of the Groups operations and facilities effective decision-making. The Board will constantly examine its size, with the view to determining its impact upon its effectiveness. Members of the Board are constantly in touch with the Management to provide advice and guidance on strategic issues and on matters for which their expertise will be constructive to the Group. Key information on the Directors is set out below and on pages 6 and 7 of this Annual Report. Directorship (a) Date first appointed (b) Date last re-elected (a) (b) (a) (b) (a) (b) (a) (b) (a) (b) (a) (b) 18/2/1997 NA 24/8/2011 6/5/2011 20/8/1999 28/10/2009 20/8/1999 23/10/2008 6/7/2011
Name of Director Mr. Lim Kee Liew @ Victor Lim
Age 54
Due for re-election at next AGM Retiring pursuant to Article 88 Retiring pursuant to Article 88 Retiring pursuant to Article 89 Retiring pursuant to Article 88
Mr. Lin Xianglong Winchester
27
Mr. Ng Chee Wee
38
Dr. Wang Kai Yuen
64
Mr. Teo Kio Choon @ Chang Chiaw Choon
64
Mr. Chue Wai Tat
64
12
Asian Micro Holdings Limited

Principle 3 Chairman and Chief Executive Officer
The roles of the Chairman and Chief Executive Officer are separate to ensure an appropriate balance of power, increased accountability and greater capacity of the Board for independent decision-making. The Chairman and the Chief Executive Officer are not related. The Chairman, Dr. Wang Kai Yuen, is an independent Director. The responsibilities of the Chairman include: (a) (b) (c) (d) (e) (f) scheduling meetings that enable the Board to perform its duties responsibly while not interfering with the flow of the Companys operations; exercising control over quality, quantity and timeliness of the flow of information between Management and the Board; assisting to ensure compliance with the Companys guidelines on corporate governance; encourage effective communication with shareholders; facilitating the effective contribution of non-executive directors; and encouraging constructive relations between executive, non-executive directors and management.
Mr. Lim Kee Liew @ Victor Lim, the Chief Executive Officer and Group Managing Director, sets business strategies and directions for the Group and manages the business operations of the Group with Mr. Lin Xianglong Winchester and Mr. Ng Chee Wee, who are Executive Directors and other management staff. Principle 4 Board Membership
The Nominating Committee (NC) comprises three Directors, of whom, including the Chairman, are independent non-executive Directors. The members are: Mr. Teo Kio Choon @ Chang Chiaw Choon Dr. Wang Kai Yuen Mr. Chue Wai Tat The principal functions of the NC are: (a) to identify candidates, review nominations for both appointment and re-appointment of the Directors to the Board for its approval. For the appointment of new candidates to the Board, the proposed appointees background, experience and other board memberships will be taken into account; to review the Board structure and size including the composition of the Board generally and the balance between executive and non-executive Directors appointed to the Board, and make recommendations to the Board with regard to any adjustments that are deemed necessary; to review the independence of each Director annually; to assess the effectiveness of the Board as a whole, and the contribution by each Director to the effectiveness of the Board; to decide how the performance of the Board may be evaluated and to propose objective performance criteria; to report to the Board its findings from time to time on matters arising and requiring the attention of the NC; and to undertake such other reviews, projects, functions, duties and responsibilities as may be requested by the Board. (Chairman)
(b)
(c) (d)
(e)
(f)
(g)
The NC has adopted written terms of reference.
Annual Report 2011
13

In accordance with Article 88 and Article 89 of the Articles of Association of the Company, new Directors must submit themselves for re-election at the next Annual General Meeting (AGM) of the Company and one-third of the Directors who are eligible for re-election must retire by rotation at every AGM. The Directors of the Company submit themselves for re-nomination and re-election at the regular intervals at least every 3 years. The NC has recommended the nominations of Mr. Lin Xianglong Winchester, Mr. Ng Chee Wee, Mr. Chue Wai Tat and Mr. Teo Kio Choon @ Chang Chiaw Choon for re-election at the forthcoming AGM. The Company has in place a system to access the performance of the Board as a whole. The result of the exercise is reviewed by the NC before submitting to the Board for discussing and determining areas for improvement and enhancing of the Board effectiveness. The Board adopts the independence test recommended by the Code. Taking into account the independence test, the NC considers and determines the independence of directors. Key information regarding the directors is set out in this Annual Report under the heading titled Board of Directors. Principle 5 Board Performance
In determining the objective performance criteria for evaluation and determination for the FY2011, the NC had considered the attendance, participation and contribution of individual Directors at Board and Committee meetings to evaluate each Directors performance. The attendances of the Directors at meetings of the Board and Board Committees during the year are as follows: Board Meeting No. of meeting held : 2 Audit Committee 2 Remuneration Committee 1 Nominating Committee 1
Name of Director : Lim Kee Liew @ Victor Lim Leong Lai Heng1 Chan Sze Ming2 Dr. Wang Kai Yuen Teo Kio Choon @ Chang Chiaw Choon Tan Siew Bin, Ronnie3
1 2 3
2 2 2 2 2 2
NA NA NA 2 2 2
NA NA NA 1 1 1
NA NA NA 1 1 1
resigned on 24 August 2011 resigned on 1 June 2011 resigned on 25 May 2011
Principle 6
Access to Information
Board members are provided with adequate and timely information prior to Board meetings, and on an ongoing basis, have separate and independent access to the Companys senior management. Detailed Board Committee/ Board papers are prepared for each Board Committee/Board meeting. The Board papers include sufficient information on financial, business and corporate issues from Management to enable Directors to be properly informed on issues to be considered at Board Meetings. The Board has separate and independent access to the Companys senior management and the Company Secretary to address any enquires at all times.
14

The Company Secretary attends Board meetings and is responsible for ensuring that Board procedures are followed. The Company Secretary ensures that the Company complies with the requirements of the Companies Act Cap. 50. Together with the management staff of the Company, the Company Secretary is responsible for compliance with all other SGX-ST rules and regulations, which are applicable to the Company. In addition, the Board takes independent professional advice as and when necessary to enable it to discharge its duty and responsibilities effectively. The cost of such professional advice will be borne by the Company. The appointment and the removal of the Company Secretary are subject to the Boards approval.
REMUNERATION MATTERS
Principle 7 Principle 8 Principle 9 Procedures for Developing Remuneration Policies Level and Mix of Remuneration Disclosure on Remuneration
The Remuneration Committee (RC) comprises the following members: Dr. Wang Kai Yuen Mr. Teo Kio Choon @ Chang Chiaw Choon Mr. Chue Wai Tat The principal responsibilities of the RC are: to review and recommend to the Board an appropriate and competitive framework of remuneration for the Board and key executives of the Group to attract, retain and motivate employees of the required caliber to manage the Company successfully; to determine and recommend to the Board specific remuneration packages for each Executive Director, taking into account factors including remuneration packages of Executive Directors in comparable industries as well as the performance of the Company and that of the Executive Directors; to review Managements proposal of the fees for Independent Non-Executive Directors; and to ensure that the remuneration policies and systems of the Group supports the Groups objectives and strategies. The RC has adopted written terms of reference. The remuneration package adopted for the Executive Directors is as per the service contract entered into between the respective Executive Director and the Company. The NC, together with the RC, decides on the specific remuneration package for an Executive Director upon recruitment. Thereafter, the RC reviews subsequent increments, bonuses and allowances where these payments are discretionary. No Director or member of the RC is involved in deciding his or her own remuneration. The RC reviews what compensation commitments the executive directors service contracts would entail in event of early termination and aims to be fair and avoid rewarding inadequate performance. The service contract may be terminated by either the Company or Executive Directors giving to the other at least 6 months prior written notice. The RC is of the view that the Directors service contracts are not excessively long or with onerous removal clauses. Independent Non-Executive Directors do not enter into any Service Contracts with the Company. Save for the receipt of directors fees and participation in the Companys Employees Share Option Scheme, Independent NonExecutive Directors do not receive any remuneration from the Company. Directors fees are set in accordance with a remuneration framework comprising basic fees, attendance fees and additional fees for serving on any of the Board Committees. Directors fees are approved by the shareholders of the Company as a lump sum payment at the Annual General Meeting of the Company. (Chairman)
Annual Report 2011
15

Other than Ms. Leong Lai Heng, no employees of the company and its subsidiaries are related to Directors or the Chief Executive Officer whose remuneration exceeded S$150,000 during the financial year ended 30 June 2011. The following table shows the breakdown of the fees and remuneration of Directors (in percentage terms) for the year ended 30 June 2011: Other Benefits including benefits in kind %
Remuneration band and name of directors
Fee %
Salary %
Total %
S$250,000 to below S$500,000 : Lim Kee Liew @ Victor Lim Leong Lai Heng* Below S$250,000 : Chan Sze Ming, William1 Dr. Wang Kai Yuen Teo Kio Choon @ Chang Chiaw Choon Tan Siew Bin, Ronnie Ng Chee Wee
1 2 3
95 93
5 7
100 100
100 100 100
89 95
11 5
100 100 100 100 100
resigned on 1 June 2011 resigned on 25 May 2011 appointed on 6 May 2011 Winchester Lin was the alternative director to Ms Leong during the financial year and his remuneration is disclosed below
The annual remuneration for key executives (in percentage terms) during the year is as follows: Other Benefits %
Key executives
Salary %
Bonus %
Total %
Below S$250,000 : Lin Xianglong, Winchester* Han Yee Yen

1
66 96 95 94 90
2 2
34 4 5 6 8 1
100 100 100 100 100 100 100 100 100
Lim Kee Hing Lim See Wai Vincent Koh

2 3
Ng Chee Wee Ng Cher Lek Yang Lei
100 100 98 99
Ang Chee Hao

1 2 3
resigned as Financial Controller on 8 October 2010 resigned as Assistant General Manager on 30 June 2011 appointed as Group Financial Controller on 30 August 2010
16

ACCOUNTABILITY AND AUDIT
Principle 10 Accountability
In presenting the annual financial statements and half-yearly announcements to shareholders, it is the aim of the Board to provide the shareholders with a detailed analysis, explanation and assessment of the Groups financial position and prospects. Management currently provides all members of the Board with appropriately detailed management accounts of the Groups performance, position and prospects on a half-yearly and such management accounts are provided to executive directors on a monthly basis. Principle 11 Principle 12 Principle 13 Audit Committee Internal Control Internal Audit
The Audit Committee (AC) comprises the following members, all of whom are Independent Non-Executive Directors, appropriately qualified to discharge their responsibilities: Dr. Wang Kai Yuen Mr. Teo Kio Choon @ Chang Chiaw Choon Mr. Chue Wai Tat (Chairman)
The AC met twice (2) in FY2011. The principal functions of the AC are: to recommend to the Board of Directors the External Auditors to be nominated; to review the scope, audit plans, results and effectiveness of the External Auditors; to review any related significant findings and recommendations of the External Auditors, together with Managements responses thereto; to review the adequacy of the Groups system of internal controls, financial and management reporting systems; to review with Management on significant risks or exposures that exist and assesses the steps that Management has taken to minimize such risks to the Group; to review with Management the announcement of the interim and full-year results of the Group and its financial statements; to review interested party transactions as may be required by the regulatory authorities or the provisions of the Companies Act; to review legal and regulatory matters that may have a material impact on the financial statements and reports action and minutes of the AC to the Board of Directors with such recommendations as the AC considers appropriate; and to review arrangements by which staff of the Company may, in confidence, raise concerns about possible improprieties in matters of financial reporting or other matters. The AC had adopted written terms of reference. The AC has full access to and receives co-operation from the Management, and has full discretion to invite members of the management to attend its meetings. Reasonable resources have been given to enable it to discharge its functions. Minutes of the AC meetings are circulated to the Board for its information. The AC has conducted an annual review of all non-audit services by the external auditors to satisfy itself that the nature and extent of such services will not prejudice the independence and objectivity of the external auditors and has recommended to the Board the re-appointment of Messrs Ernst & Young LLP as the auditors of the Company. The AC has met with the external auditors annually, without the presence of the Companys management. Annual Report 2011
17

The Board recognizes its responsibility for the Groups system of internal controls and the need to review its adequacy and integrity regularly in order to safeguard the Groups assets and therefore shareholders investments in the Group. The Companys senior management has made regular visits to the operating units within the Group. A management structure with clearly defined lines of responsibility that promotes effective internal control is in place. To further strengthen the internal control system, the Management will consider the establishment of an independent internal audit function either on an in-house or outsourced basis.
COMMUNICATION WITH SHAREHOLDERS

Principle 14 Principle 15 Communication with Shareholders Greater Shareholder Participation
In line with the continuous disclosure obligations of the Company and pursuant to the Listing Manual of the SGXST and the Companies Act, Chapter 50, shareholders shall be informed of all major developments that impact the Group, in a timely manner. The Company does not practice selective disclosure. All material and price sensitive information as well as information on the Companys new initiatives are publicly released via SGXNET. In addition, the Company also responds to enquiries from shareholders, investors, analysts, fund managers and the press. All shareholders of the Company receive a copy of the Annual Report and Notice of Annual General Meeting (AGM) annually. The Notice of the AGM is also advertised in a daily newspaper and made available on the SGX-ST website. At the AGM, shareholders are given the opportunity to air their views and ask questions regarding the Company and the Group. The Articles of Association of the Company allows shareholders to appoint one or two proxies to attend and vote in their stead at the AGM. Each item of special business included in the Notice of meetings is accompanied, where appropriate, by an explanation for the proposed resolution. Separate resolutions are proposed for substantially separate issues at meetings. The Chairmen of the Audit, Remuneration and Nominating Committees are normally available at the AGM to answer questions relating to the work of these committees. The external auditors are also present to assist the Directors in addressing any relevant queries from shareholders. The Company Secretary records minutes of every AGM and the minutes will be made available to the shareholders upon their request.
RISK MANAGEMENT
The Company does not have a Risk Management Committee. However, the Management reviews the Companys business and operational activities regularly to identify areas of significant business risks as well as appropriate measures to control and mitigate these risks. The Management reviews all significant control policies and procedures and highlights all significant matters to the Board and the Audit Committee.
DEALINGS IN SECURITIES
The Company has a clear policy on the trading of its shares by directors, executives and employees within the Group. The Company has adopted its own internal Code of Best Practices on Securities Transactions (the Securities Transactions Code); The Securities Transactions Code provides guidance to the directors and executives of the Group with regard to dealing in the Companys shares. It emphasizes that the law on insider trading is applicable at all times, notwithstanding the window periods for dealing in the shares. The Securities Transactions Code also enables the Company to monitor such share transactions by requiring employees to report to the Company whenever they deal in the Companys shares. The Group issues circulars to its directors, executives and employees informing them that they must not trade in the listed securities of the Company one month before the announcement of the Groups half-yearly and full year results and ending on the date of the announcement of such results.
18

The directors are required to notify the Company of any dealings in the Companys securities (during the open window period) within two (2) business days of the transactions. The Board is satisfied with the Groups commitment in compliance with the Code, and on the adequacy of internal controls within the Group. The Group has complied with its Best Practices on Securities Transactions.
MATERIAL CONTRACTS
Save for the service contracts between the Executive Directors and the Company, and the interested person transactions described below, there are no other material contracts of the Company or its subsidiaries involving the interest of the chief executive officer or any director or controlling shareholders which are either still subsisting at the end of the financial year or entered into since the end of the previous financial year.
INTERESTED PERSON TRANSACTIONS

The Company has established procedures to ensure that all transactions with interested persons are reported on a timely manner to the Audit Committee and that such transactions are carried out on normal commercial terms and will not be prejudicial to the interests of the Company and its minority shareholders. The aggregate value of the interested person transactions entered into FY2011 is as follows: Aggregate value of all interested person transactions during the financial year under review (excluding transaction less than S$100,000 and transactions conducted under shareholders mandate pursuant to Rule 920) $208,000 $126,900
Name of interested person Ultraline Technology (S) Pte Ltd Asian Micro Industries (Thailand) Co., Ltd
NON-AUDIT FEES AND NON-SPONSOR FEES

The Company is currently under the SGX-ST Catalist sponsor-supervised regime. The Continuing Sponsor of the Company is Asian Corporate Advisors Pte. Ltd. KW Capital Pte. Ltd. was the continuing sponsor of the Company up to 31 October 2010. The Company appoints Asian Corporate Advisors Pte. Ltd. as its continuing sponsor with effect from 1 November 2010. In compliance with Rule 1204(20) of the Catalist Rule, there was no non-sponsor fee paid by the Company to the sponsor, for the year ended 30 June 2011. There were no non-audit fees paid to the external auditors for the financial year concerned.
TREASURY SHARES
There are no treasury shares held by the Company.
Annual Report 2011
19
DIRECTORS REPORT
The directors present their report to the members together with the audited consolidated financial statements of Asian Micro Holdings Limited (the Company) and its subsidiaries (collectively, the Group) and the balance sheet and statement of changes in equity of the Company for the financial year ended 30 June 2011.
Directors
The directors of the Company in office at the date of this report are: Dr. Wang Kai Yuen Lim Kee Liew @ Victor Lim Lin Xianglong Winchester Ng Chee Wee Teo Kio Choon @ Chang Chiaw Choon Chue Wai Tat
(appointed on 24 August 2011) (appointed on 6 May 2011) (appointed on 6 July 2011)
Arrangements to enable directors to acquire shares and debentures

Except for the Asian Micro Holdings Limited Employees Share Option Plan as described below, neither at the end of nor at any time during the financial year was the Company a party to any arrangement whose object is to enable the directors of the Company to acquire benefits by means of the acquisition of shares or debentures of the Company or any other body corporate.
Directors interests in shares and debentures

The following directors, who held office at the end of the financial year, had, according to the register of directors shareholdings required to be kept under section 164 of the Companies Act, Cap. 50, an interest in shares of the Company and related corporations (other than wholly-owned subsidiaries), as stated below: Direct interest At 1 July 2010 or date of appointment The Company Asian Micro Holdings Limited (Ordinary shares) Lim Kee Liew @ Victor Lim Leong Lai Heng * Ng Chee Wee Dr. Wang Kai Yuen Teo Kio Choon @ Chang Chiaw Choon At 30 June 2011 At 21 July 2011 At 1 July 2010 Deemed interest At 30 June 2011 At 21 July 2011
46,808,217 76,579,760 100,000 1,526,000
104,741,217 104,741,217 118,646,760 118,646,760 100,000 1,526,000 100,000 1,526,000
117,151,304 159,218,304 159,218,304 87,379,761 145,312,761 145,312,761
600,000
600,000
600,000
20
DIRECTORS REPORT
Directors interests in shares and debentures (contd)
Direct interest At At beginning end of the of the year year or date of appointment The Company Asian Micro Holdings Limited (Options to subscribe for ordinary shares) Lim Kee Liew @ Victor Lim Leong Lai Heng * Ng Chee Wee At 21 July 2011 Exercise price $
Exercise period
1,500,000 574,000 1,180,000 1,500,000 1,500,000 900,000
2,000,000 2,000,000 1,500,000 574,000 1,180,000 1,500,000 4,000,000 1,500,000 900,000 2,500,000
2,000,000 2,000,000 1,500,000 1,500,000 574,000 1,180,000 1,500,000 4,000,000 1,000,000 1,500,000 900,000 2,500,000 500,000
0.015 0.015 0.015 0.010 0.070 0.090 0.030 0.015 0.010 0.090 0.030 0.015 0.010
November 2011 October 2020 November 2011 October 2020 November 2011 October 2020 July 2012 October 2020 August 2004 September October 2004 September December 2010 September November 2011 October July 2012 October October 2004 September December 2010 September November 2011 October July 2012 October 2011 2011 2011 2020 2020 2011 2011 2020 2020
Dr. Wang Kai Yuen
Teo Kio Choon @ Chang Chiaw Choon
* Resigned as director of the Company on 24 August 2011.
By virtue of Section 7 of the Singapore Companies Act, Cap. 50, Lim Kee Liew @ Victor Lim and Leong Lai Heng are deemed to have an interest in shares of the subsidiaries of the Company. Except as disclosed in this report, no director who held office at the end of the financial year had interests in shares, share options, warrants or debentures of the Company or of related corporations either at the beginning or end of the financial year or 21 July 2011.
Directors contractual benefits

Except as disclosed in the financial statements, since the end of the previous financial year, no director of the Company has received or become entitled to receive a benefit by reason of a contract made by the Company or a related corporation with the 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, except for significant transactions with related parties as disclosed in Note 27 to the accompanying financial statements.
Annual Report 2011
21
DIRECTORS REPORT
Share options Asian Micro Employees Share Option Scheme
1. Asian Micro Employees Share Option Scheme (the ESOS 2001) was approved by the shareholders at an extraordinary general meeting held on 28 September 2001. The ESOS 2001 was subsequently terminated by shareholders at an extraordinary general meeting held on 28 October 2010. Members who administered the ESOS 2001 during the financial year are: Lim Kee Liew @ Victor Lim Leong Lai Heng Teo Kio Choon @ Chang Chiaw Choon 3. 4. No option has been granted during the financial year. Details of the balance of the options to subscribe for ordinary shares of the Company pursuant to the ESOS 2001 as at 30 June 2011 are as follows: Exercise price (S$) 0.050 0.060 0.180 0.165 0.065 0.070 0.090 0.090 0.090 0.100 0.105 0.050 0.050 0.030
2.
Grant date October 2001 November 2001 May 2002 June 2002 August 2003 August 2003 October 2003 October 2005 May 2007 June 2007 June 2007 July 2008 September 2008 December 2009
Expiry date September 2011 September 2011 September 2011 September 2011 September 2011 September 2011 September 2011 September 2011 September 2011 September 2011 September 2011 September 2011 September 2011 September 2011
Number of options 800,000 152,000 56,000 68,000 21,000 574,000 2,646,000 525,000 550,000 230,000 200,000 675,000 50,000 7,960,000 14,507,000
22
DIRECTORS REPORT
Share options (contd)
5. Details of the options to subscribe for ordinary shares of the Company granted to directors of the Company pursuant to the ESOS 2001 are as follows: Aggregate options granted since commencement of ESOS 2001 6,380,000 Aggregate options cancelled since commencement of ESOS 2001 (2,000,000) Aggregate options exercised since commencement of ESOS 2001 (1,126,000)
Name of directors Dr. Wang Kai Yuen Teo Kio Choon @ Chang Chiaw Choon Ronnie Tan Siew Bin Chan Sze Ming 6.
Options granted during the financial year
Aggregate options outstanding as at end of financial year 3,254,000
4,300,000 916,000 3,900,000
(200,000) (16,000)
(1,700,000) (100,000)
2,400,000 900,000 3,800,000
Apart from the following who have in aggregate received 5% or more of the total number of options available under the ESOS 2001, none of the other executive directors and employees of the Group who participated in the ESOS 2001 has received 5% or more of the total number of options available under the ESOS 2001: Total options granted Dr. Wang Kai Yuen Teo Kio Choon @ Chang Chiaw Choon Chan Sze Ming *
* Resigned as director of the Company on 1 June 2011.
Total % of options under the ESOS 2001 9.17% 6.18% 5.61%
6,380,000 4,300,000 3,900,000
Except for the above, no options have been granted to other directors, controlling shareholders of the Company or their associates. The options do not entitle the holder to participate, by virtue of the options, in any share issue of any other corporation. No options had been exercised from the financial year end to the date of this report. No unissued shares, other than those referred to above, are under option as at the date of this report. None of the options were granted at a discount during the financial year.
Annual Report 2011
23
DIRECTORS REPORT
Asian Micro Employees Share Option Scheme 2010
1. Asian Micro Employees Share Option Scheme 2010 (the ESOS 2010) was approved by shareholders at an extraordinary general meeting held on 28 October 2010. Members who administered the ESOS 2010 during the financial year are: Lim Kee Liew @ Victor Lim Leong Lai Heng Teo Kio Choon @ Chang Chiaw Choon 3. During the financial year ended 30 June 2011, the Company granted 25,950,000 share options under the ESOS 2010. These options are only exercisable after the first anniversary of the Date of Grant of options. These options expire on 28 October 2020 and are exercisable if the employee remains in service. Details of the balance of the options to subscribe for ordinary shares of the Company pursuant to the ESOS 2010 as at 30 June 2011 are as follows: Exercise price (S$) 0.015
2.
4.
Grant date November 2010 5.
Expiry date October 2020
Number of options 19,450,000
Details of the options to subscribe for ordinary shares of the Company granted to directors of the Company pursuant to the ESOS 2010 are as follows: Aggregate options granted since commencement of ESOS 2010 Aggregate options cancelled since commencement of ESOS 2010 Aggregate options exercised since commencement of ESOS 2010
Options granted during the financial year Name of Directors Lim Kee Liew @ Victor Lim Leong Lai Heng Ng Chee Wee Dr. Wang Kai Yuen Teo Kio Choon @ Chang Chiaw Choon Name of Associates of controlling shareholders Lim Kee Hing Lin Xianglong Winchester 2,000,000 2,000,000 2,000,000 2,000,000 1,500,000 4,000,000
Aggregate options outstanding as at end of financial year
2,000,000 2,000,000 1,500,000 4,000,000
2,000,000 2,000,000 1,500,000 4,000,000
2,500,000
2,500,000
2,500,000
2,000,000 2,000,000
2,000,000 2,000,000
24
DIRECTORS REPORT
Share options (contd)
6. Save as disclosed, none of the directors and employees of the Group who participated in the ESOS 2010 has received 5% or more of the total number of options available under the ESOS 2010. The options do not entitle the holder to participate, by virtue of the options, in any share issue of any other corporation. No options had been exercised from the financial year end to the date of this report. No unissued shares, other than those referred to above, are under option as at the date of this report. None of the options were granted at a discount during the financial year.
Audit committee
The audit committee carried out its functions in accordance with Section 201B(5) of the Singapore Companies Act, Cap. 50. The functions performed are detailed in the Report on Corporate Governance.
Auditors
Ernst & Young LLP have expressed their willingness to accept re-appointment as auditors.
On behalf of the Board of directors,
Lim Kee Liew @ Victor Lim Director
Lin Xianglong Winchester Director
Singapore 7 October 2011
Annual Report 2011
25
STATEMENT BY DIRECTORS
We, Lim Kee Liew @ Victor Lim and Lin Xianglong Winchester, being two of the directors of Asian Micro Holdings Limited, do hereby state that, in the opinion of the directors, (i) the accompanying balance sheets, consolidated statement of comprehensive income, statements of changes in equity and consolidated cash flow statement together with notes thereto are drawn up so as to give a true and fair view of the state of affairs of the Group and of the Company as at 30 June 2011 and the results of the business, changes in equity and cash flows of the Group and the changes in equity of the Company for the year ended on that date, and at the date of this statement, there are reasonable grounds to believe that the Company will be able to pay its debts as and when they fall due, on the assumption that, as stated in Note 2.1 to the financial statements, the Group and the Company will generate adequate cash flows from operations and continue to receive continuing financial support from two major shareholders of the Company.
(ii)
On behalf of the Board of directors,
Lim Kee Liew @ Victor Lim Director
Lin Xianglong Winchester Director
Singapore 7 October 2011
26
INDEPENDENT AUDITORS REPORT

For the financial year ended 30 June 2011 To the Members of Asian Micro Holdings Limited
Report on the Financial Statements

We have audited the accompanying financial statements of Asian Micro Holdings Limited (the Company) and its subsidiaries (collectively the Group) set out on pages 29 to 92, which comprise the balance sheets of the Group and the Company as at 30 June 2011, the statements of changes in equity of the Group and the Company and the consolidated statement of comprehensive income and consolidated cash flow statement of the Group for the year then ended, and a summary of significant accounting policies and other explanatory information. Managements Responsibility for the Financial Statements Management is responsible for the preparation of financial statements that give a true and fair view in accordance with the provisions of the Singapore Companies Act, Cap. 50 (the Act) and Singapore Financial Reporting Standards, and for devising and maintaining a system of internal accounting controls sufficient to provide a reasonable assurance that assets are safeguarded against loss from unauthorised use or disposition; and transactions are properly authorised and that they are recorded as necessary to permit the preparation of true and fair profit and loss accounts and balance sheets and to maintain accountability of assets. Auditors Responsibility Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with Singapore Standards on Auditing. Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditors judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entitys preparation of the 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 entitys internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by management, as well as evaluating the overall presentation of the financial statements. 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 consolidated financial statements of the Group and the balance sheet and statement of changes in equity of the Company are properly drawn up in accordance with the provisions of the Act and Singapore Financial Reporting Standards so as to give a true and fair view of the state of affairs of the Group and of the Company as at 30 June 2011 and the results, changes in equity and cash flows of the Group and the changes in equity of the Company for the year ended on that date. Emphasis of matter We draw attention to Note 2.1 to the financial statements. The Group and the Company incurred a net loss after taxation of $4,429,060 and $3,723,773, respectively, for the financial year ended 30 June 2011 and as at that date, the Companys current and total liabilities exceeded its current and total assets by $2,112,381 and $635,870 respectively. These factors indicate the existence of an uncertainty which may cast significant doubt about the Group and the Companys ability to continue as going concerns. As discussed more fully in Note 2.1 to the financial statements, these financial statements have been prepared on a going concern basis on the assumption that the Group and the Company will generate adequate cash flows from operations and continue to receive continuing financial support from two major shareholders of the Company (one of whom is also a director of the Company). Our opinion is not qualified in respect of this matter.
Annual Report 2011
27
INDEPENDENT AUDITORS REPORT

For the financial year ended 30 June 2011 Report on other legal and regulatory requirements
In our opinion, the accounting and other records required by the Act to be kept by the Company and by those subsidiaries incorporated in Singapore of which we are the auditors have been properly kept in accordance with the provisions of the Act.
Ernst & Young LLP Public Accountants and Certified Public Accountants Singapore
7 October 2011
28
BALANCE SHEETS
As at 30 June, 2011
Group Note 2011 $ 2010 $ 2011 $
Company 2010 $
Non-current assets Property, plant and equipment Investments in subsidiaries Investments in associate Other investments Current assets Inventories Trade and other receivables Prepayments Due from subsidiaries (non-trade) Due from related parties (non-trade) Fixed deposits Cash and bank balances 6 7 1,380,055 1,636,371 353,334 108,333 427,033 271,807 4,176,933 Total assets Current liabilities Trade and other payables Accrued expenses Loan from directors (non-trade) Provision Due to subsidiaries (non-trade) Due to related parties (non-trade) Bills payable to bank Obligations under finance lease Provision for taxation 10 13 8 14 8 8 11 12 1,777,647 920,001 784,828 455,833 72,884 17,036 4,028,229 Net current assets/(liabilities) Non-current liabilities Obligations under finance lease Deferred tax liabilities Loan from related party (non-trade) 12 23 8 168,393 585 300,000 468,978 Total liabilities Net assets/(liabilities) 4,497,207 777,625 104,815 581 105,396 6,152,603 2,166,548 15,740 585 16,325 2,175,725 (635,870) 22,925 581 23,506 1,360,161 1,368,068 148,704 2,228,286 1,913,654 400,472 51,797 161,706 916,353 129,424 245,515 6,047,207 555,429 149,488 582,277 1,420,451 7,184 2,159,400 (2,112,381) 200,669 1,129,431 6,555 1,336,655 (705,338) 5,274,832 2,598,789 2,111,314 460,312 5,136 376,972 1,050,113 6,602,636 8,319,151 4,335 13,502 2,561 25,666 955 47,019 1,539,855 16,815 7,716 522,085 76,151 8,550 631,317 2,728,229 3 4 5(a) 5(b) 1,097,899 1,716,515 33,805 1,459,031 37,835 2,059,077
8 8 9 9
Annual Report 2011
29
BALANCE SHEETS
As at 30 June, 2011
Group Note 2011 $ 2010 $ 2011 $
Company 2010 $
Equity attributable to owners of the Company Share capital Share option reserve Foreign currency translation reserve Premium paid on acquisition of non-controlling interests Other reserve Accumulated losses Non-controlling interests Total equity Total equity and liabilities 15 16 38,673,928 389,987 1,524,093 17 96,189 (39,487,296) 1,196,901 (419,276) 777,625 5,274,832 37,173,928 212,944 147,417 (638,162) 96,189 (34,995,336) 1,996,980 169,568 2,166,548 8,319,151 38,673,928 389,987 96,189 (39,795,974) (635,870) (635,870) 1,539,855 37,173,928 212,944 96,189 (36,114,993) 1,368,068 1,368,068 2,728,229
The accompanying accounting policies and explanatory notes form an integral part of the financial statements.
30
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

For the year ended 30 June 2011
Note
2011 $
2010 $ (Reclassified) 20,703,625 (18,719,494) 1,984,131 836,761 (445,920) (4,027,106) (1,258,463) (2,910,597) (125,687) 3,590 21,657 (3,011,037) (70,621) (3,081,658)
Revenue Cost of sales Gross profit Other operating income Distribution and selling expenses Administrative expenses Other operating expenses Loss from operations Financial expenses Financial income Share of results of associated companies Loss before taxation Taxation Net loss for the year Other comprehensive income Foreign currency translation Foreign currency reserve realised on disposal of subsidiaries Other comprehensive income/(loss) for the year, net of tax Total comprehensive loss for the year Loss attributable to: Owners of the parent Non-controlling interests
18
8,575,068 (6,970,665) 1,604,403
19(a)
19(b) 21 21 20 23
459,666 (267,126) (3,857,170) (2,515,885) (4,576,112) (67,341) 3,290 (4,640,163) 211,103 (4,429,060)
1,720,577 (400,275) 1,320,302 (3,108,758)
(2,170) (518,142) (520,312) (3,601,970)
(3,896,590) (532,470) (4,429,060)
(3,023,458) (58,200) (3,081,658)
Total comprehensive income attributable to: Owners of the parent Non-controlling interests (2,519,914) (588,844) (3,108,758) Loss per share attributable to owners of the parent (cents per share) Basic Diluted 24 24 (0.94) (0.94) (0.84) (0.84) (3,521,939) (80,031) (3,601,970)
The accompanying accounting policies and explanatory notes form an integral part of the financial statements. Annual Report 2011
31
32
Attributable to owners of the Parent Equity attributable to owners of the Parent $ Share capital $ Accumulated losses $ Other reserve total $ Noncontrolling interests $ Foreign currency translation reserve $ Employee share option reserve $ Premium paid on acquisition of noncontrolling interests $ 4,888,107 (3,023,458) (498,481) (3,521,939) (3,023,458) (498,481) (498,481) (3,023,458) 36,653,215 (32,124,613) 96,189 645,898 (638,162) 255,580 249,599 (58,200) (21,831) (80,031)
2010 Group
Total equity $
STATEMENTS OF CHANGES IN EQUITY
Asian Micro Holdings Limited 110,099 152,735 110,099 (152,735) 520,713 630,812 1,996,980 37,173,928 520,713 152,735 (34,995,336) 520,713 96,189 147,417 (638,162) (42,636) 212,944 169,568
Opening balance at 1 July 2009
5,137,706
Net loss for the year
(3,081,658)
Other comprehensive loss for the year, net of tax
(520,312)
Total comprehensive loss for the year
(3,601,970)
Contributions by and distributions to owners
Grant of equity-settled share options to employees (Note 16)
110,099
Expiry of employee share options (Note 16)
Capitalisation of payables to certain directors and a trade creditor
520,713
Total transactions with owners in their capacity as owners
630,812
Closing balance at 30 June 2010
2,166,548
Attributable to owners of the Parent
2011 Group Share capital $ Accumulated losses $
Total equity $
Equity attributable to owners of the Parent $ Other reserve total $ Noncontrolling interests $ Foreign currency translation reserve $ Employee share option reserve $
Premium paid on acquisition of noncontrolling interests $
Opening balance at 1 July 2010 1,996,980 (3,896,590) 1,376,676 (2,519,914) (4,534,752) 1,376,676 638,162 (638,162) 1,376,676 638,162 (3,896,590) 37,173,928 (34,995,336) 96,189 147,417 (638,162) 212,944
2,166,548
169,568 (532,470) (56,374) (588,844)
Net loss for the year
(4,429,060)
Other comprehensive loss for the year, net of tax
1,320,302
Total comprehensive loss for the year
(3,108,758)
Contributions by and distributions to owners
Grant of equity-settled share options to employees (Note 16) 219,835 1,500,000 1,719,835 1,196,901 38,673,928 (39,487,296) 1,500,000 42,792 1,500,000 96,189 42,792
219,835
1,524,093
219,835 (42,792) 177,043 389,987
(419,276)
Expiry of employee share options (Note 16)
Capitalisation of payables to certain directors
1,500,000
Total transactions with owners in their capacity as owners
1,719,835
Closing balance at 30 June 2011
Annual Report 2011
777,625
33

Company
Share capital $ 36,653,215
Accumulated losses $ (32,186,383) (4,081,345)
Other reserve $ 96,189
Share option reserve $ 255,580
Total equity $ 4,818,601 (4,081,345)
Balance as at 1 July 2009 Total comprehensive loss for the year Contribution by and distributions to owners Grant of equity-settled share options to employees (Note 16) Expiry of employee share options (Note 16) Capitalisation of payables to certain directors and a trade creditor Total transactions with owners in the capacity as owners Balance as at 30 June 2010
152,735
110,099 (152,735)
110,099
520,713 520,713 37,173,928
152,735 (36,114,993)
96,189
(42,636) 212,944
520,713 630,812 1,368,068
Balance as at 1 July 2010 Total comprehensive loss for the year Grant of equity-settled share options to employees (Note 16) Expiry of employee share options (Note 16) Capitalisation of payables to certain directors Total transactions with owners in the capacity as owners Balance as at 30 June 2011
37,173,928 1,500,000 1,500,000 38,673,928
(36,114,993) (3,723,773) 42,792 42,792 (39,795,974)
96,189 96,189
212,944 219,835 (42,792) 177,043 389,987
1,368,068 (3,723,773) 219,835 1,500,000 1,719,835 (635,870)
34
CONSOLIDATED CASH FLOW STATEMENT

Note
2011 $
2010 $
Cash flow from operating activities Loss before taxation Adjustments: Allowance for doubtful debts (trade) Allowance for doubtful debts (non-trade) Write-off of doubtful debts Allowance for stocks obsolescence Write-back of allowance for doubtful debts Write-back of allowance for stock obsolescence (Write-back)/write-off of stocks Gain on disposal of subsidiaries Depreciation of property, plant and equipment Property, plant and equipment written off Gain on disposal of property, plant and equipment Impairment loss on property, plant and equipment Waiver of payables Write-back of provision for warranty Interest expense Interest income Share of results of associated companies Share-based payment expenses Operating loss before working capital changes Decrease in stocks Decrease/(increase) in trade and other receivables Decrease/(increase) in prepayments (Increase)/decrease in amount due from /(to) related parties Decrease in amount due from affiliated companies Increase in trade and other payables Increase in accrued expenses (Decrease)/Increase in provision (Decrease)/increase in bills payable to bank Increase in amount due to directors (non-trade) Cash (used in)/generated from operations Interest paid Interest income received Income taxes paid Income taxes refunded Net cash (used in)/generated from operating activities (4,640,163) 12,639 3,253 543 714,397 (6,207) (8,066) (163,214) 499,662 52,393 (91,000) 166,153 (2,050) (51,797) 47,704 (3,290) 219,835 (3,249,208) 664,349 580,415 128,819 680,899 817,537 (51,797) (460,520) (889,506) (47,704) 3,290 (38,836) (972,756) (3,011,037) 187,384 12,453 175,835 248,037 (262,266) 123,494 (221,480) 695,333 15,368 (13,084) 528,287 (230,806) 79,124 (3,590) (21,657) 110,099 (1,588,506) 1,368,584 (113,591) (10,505) 98,858 96,128 201,127 865,663 51,797 151,879 550,472 1,671,906 (79,124) 3,590 (141,606) 82,198 1,536,964
Annual Report 2011
35
CONSOLIDATED CASH FLOW STATEMENT

Note
2011 $
2010 $
Cash flow from investing activities Net cash flow from disposal of subsidiaries Proceeds from disposal of property, plant and equipment Purchase of property, plant and equipment Net cash used in investing activities Cash flows from financing activities Loan from related party Drawdown of finance lease obligations Repayment of finance lease obligations Fixed deposits pledged Net cash generated from/(used in) financing activities Net (decrease)/increase in cash and cash equivalents Effect of exchange rate changes in cash and cash equivalents Cash and cash equivalents at beginning of year Cash and cash equivalents at end of year 9 300,000 155,455 (145,290) (51,837) 258,328 (772,669) (5,637) 1,050,113 271,807 (240,250) (9,582) (249,832) 442,942 812 606,359 1,050,113 4 3 (13,948) 336,977 (381,270) (58,241) (763) 169,949 (1,013,376) (844,190)
36
NOTES TO THE FINANCIAL STATEMENTS

30 June 2011 1. Corporate information
Asian Micro Holdings Limited is a limited liability company incorporated in Singapore and is listed on the Stock Exchange of Singapore Catalist Sponsor-Supervised regime (Catalist). The registered office and principal place of business of Asian Micro Holdings Limited is located at 1 Tech Park Crescent, Tuas Tech Park, Singapore 638131. The principal activity of the Company is that of investment holding. The principal activities of the subsidiaries are those of natural gas vehicles conversion, tray-recycling services, manufacturing of clean room grade polythene packaging materials and trading in clean room supplies. Details of these subsidiaries are disclosed in Note 4 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

The consolidated financial statements of the Group and the balance sheet and statement of changes in equity of the Company have been prepared in accordance with Singapore Financial Reporting Standards (FRS). The financial statements have been prepared on the historical cost basis. The financial statements are presented in Singapore Dollars (SGD or $).
2.1
Fundamental accounting concept The Group and the Company incurred a net loss after taxation of $4,429,060 (2010: $3,081,658) and $3,723,773 (2010: $4,081,345), respectively for the financial year ended 30 June 2011 and as at that date, the Companys current and total liabilities exceeded current and total assets by $2,112,381 (2010: $705,338) and $635,870 respectively. These factors indicate the existence of an uncertainty which may affect the validity of the going concern assumption on which the accompanying financial statements are prepared. Two of the Companys major shareholders (one of whom is also a director of the Company) have agreed to provide continuing financial support to the Group and the Company to enable the Group and the Company to meet their obligations as and when the need arises. In addition, they have given a commitment to (i) not to recall for payment of salaries due to them as at 30 June 2011 and deferring payment of future salaries, and (ii) allow the Group to defer payments of rental payable to companies controlled by them until such time as the Groups cash flow enables such payment. The Directors are of the view that it is appropriate to prepare these financial statements on a going concern basis on the assumption that the Group and the Company will generate adequate cash flows from operations and continue to receive continuing financial support from the two major shareholders. If the Group and the Company are unable to continue in operational existence for the foreseeable future, the Group and the Company may be unable to discharge their liabilities in the normal course of business and adjustments may have to be made to reflect the situation that assets may need to be realised other than in the normal course of business and at amounts which could differ from the amounts at which they are currently recorded in the balance sheets. In addition, the Group and the Company may have to reclassify non-current assets and liabilities as current assets and liabilities. No such adjustments have been made to these financial statements.
2.2
Changes in accounting policies The accounting policies adopted are consistent with those of the previous financial year except in the current financial year, the Group has adopted all the new and revised standards and Interpretations of FRS (INT FRS) that are effective for annual periods beginning on or after 1 January 2010. Except for the revised FRS 103 and the amendments to FRS27, adoption of these standards and interpretations did not have any effect on the financial performance or position of the Group. They did however give rise to additional disclosures, including, in some cases, revisions to accounting policies.
Annual Report 2011
37

30 June 2011 2.
2.2
Summary of significant accounting policies (contd)

Changes in accounting policies (contd) The principal effects of these changes are as follows: FRS 103 Business Combinations (revised) and FRS 27 Consolidated and Separate Financial Statements (revised) The revised FRS 103 Business Combinations and FRS 27 Consolidated and Separate Financial Statements are applicable for annual periods beginning on or after 1 July 2009. As of 1 January 2010, the Group adopted both revised standards at the same time in accordance with their transitional provisions. FRS 103 Business Combinations (revised) The revised FRS 103 introduces a number of changes to the accounting for business combinations that will impact the amount of goodwill recognised, the reported results in the period that an acquisition occurs, and future reported results. Changes in significant accounting policies resulting from the adoption of the revised FRS 103 include: Transaction costs would no longer be capitalised as part of the cost of acquisition but will be expensed immediately; Consideration contingent on future events are recognised at fair value on the acquisition date and any changes in the amount of consideration to be paid will no longer be adjusted against goodwill but recognised in profit or loss; The Group elects for each acquisition of a business, to measure non-controlling interest at fair value, or at the non-controlling interests proportionate share of the acquirees identifiable net assets, and this impacts the amount of goodwill recognised; and When a business is acquired in stages, the previously held equity interests in the acquiree is remeasured to fair value at the acquisition date with any corresponding gain or loss recognised in profit or loss, and this impacts the amount of goodwill recognised.
According to its transitional provisions, the revised FRS 103 has been applied prospectively. Assets and liabilities that arose from business combinations whose acquisition dates are before 1 January 2010 are not adjusted. FRS 27 Consolidated and Separate Financial Statements (revised) Changes in significant accounting policies resulting from the adoption of the revised FRS 27 include: A change in the ownership interest of a subsidiary that does not result in a loss of control is accounted for as an equity transaction. Therefore, such a change will have no impact on goodwill, nor will it give rise to a gain or loss recognised in profit or loss; Losses incurred by a subsidiary are allocated to the non-controlling interest even if the losses exceed the non-controlling interest in the subsidiarys equity; and When control over a subsidiary is lost, any interest retained is measured at fair value with the corresponding gain or loss recognised in profit or loss.
According to its transitional provisions, the revised FRS 27 has been applied prospectively, and does not impact the Groups consolidated financial statements in respect of transactions with non-controlling interests, attribution of losses to non-controlling interests and disposal of subsidiaries before 1 January 2010. The changes will affect future transactions with non-controlling interests.
38

30 June 2011 2.
2.3

Standards issued but not yet effective The Group has not adopted the following standards and interpretations that have been issued but not yet effective: Effective for annual periods beginning on or after 1 January 2011 1 January 2011 1 January 2011 1 July 2011 1 January 2012
Description Revised FRS 24 Related Party Disclosures Amendments to INT FRS 114 Prepayments of a Minimum Funding Requirement INT FRS 115 Agreements for the Construction of Real Estate Amendments to FRS 107 Disclosures Transfers of Financial Assets Amendments to FRS 12 Deferred Tax Recovery of Underlying Assets
Except for the revised FRS 24, the directors expect that the adoption of the other standards and interpretations above will have no material impact on the financial statements in the period of initial application. The nature of the impending changes in accounting policy on adoption of the revised FRS 24 is described below. Revised FRS 24 Related Party Disclosures The revised FRS 24 clarifies the definition of a related party to simplify the identification of such relationships and to eliminate inconsistencies in its application. The revised FRS 24 expands the definition of a related party and would treat two entities as related to each other whenever a person (or a close member of that persons family) or a third party has control or joint control over the entity, or has significant influence over the entity. The revised standard also introduces a partial exemption of disclosure requirements for governmentrelated entities. The Company is currently determining the impact of the changes to the definition of a related party has on the disclosure of related party transaction. As this is a disclosure standard, it will have no impact on the financial position or financial performance of the Company when implemented in 2011. 2.4 Significant accounting estimates and judgements The preparation of the Groups financial statements requires management to make estimates, judgements and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses, and disclosures at the end of each reporting period. 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 periods. The key assumptions concerning the future and other key sources of estimation uncertainty at the balance sheet 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. (i) Depreciation of plant and equipment The costs of plant and equipment for the manufacturing activities are depreciated on a straight-line basis over the useful lives of the plant and equipment. Management estimates the useful lives of the plant and equipment to be within 1 to 10 years. These are common life expectancies applied in the industry. The carrying amount of the Groups plant and equipment at 30 June 2011 is stated in Note 3 to the financial statements. 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.
Annual Report 2011
39

30 June 2011 2.
2.4

Significant accounting estimates and judgements (contd) (ii) Impairment of non-financial assets The Group assesses whether there are any indicators of impairment for all non-financial assets at each reporting date. Property, plant and equipment are tested for impairment when there are indicators that the carrying amounts may not be recoverable. When value in use calculations are undertaken, management estimates the expected future cash flows from the asset or cash-generating unit and chooses a suitable discounted rate in order to calculate the present value of those cash flows. (iii) Impairment of loans and receivables The Group assesses at each balance sheet date whether there is any objective evidence that a financial asset is impaired. To determine whether there is objective evidence of impairment, the Group considers factors such as the probability of insolvency or significant financial difficulties of the debtor and default or significant delay in payments. Where there is objective evidence of impairment, the amount and timing of future cash flows are estimated based on historical loss experience for assets with similar credit risk characteristics. The carrying amounts of the Groups loans and receivables at the balance sheet date are disclosed in Note 7 to the financial statements. (iv) Income taxes The Group has exposure to income taxes in a number of jurisdictions. Significant judgement is involved in determining the group-wide provision for income taxes. There are certain transactions and computations for which the ultimate tax determination is uncertain during the ordinary course of business. The Group recognises liabilities for expected tax issues based on estimates of whether additional taxes will be due. Where the final tax outcome of these matters is different from the amounts that were initially recognised, such differences will impact the income tax and deferred tax provisions in the period in which such determination is made. Deferred tax assets are recognised for all unused tax losses to the extent that it is probable that taxable profit will be available against which the losses 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. The carrying value of the unrecognised tax losses at 30 June 2011 was $19,961,000 (2010: $15,909,000). (v) Employee share options The Group measures the cost of equity-settled transactions with employees by reference to the fair value of the equity instruments at the date at which they are granted. Estimating fair value for sharebased payment transactions requires determining the most appropriate valuation model, which is dependent on the terms and conditions of the grant. This estimate also requires determining the most appropriate inputs to the valuation model including the expected life of the share option, volatility and dividend yield and making assumptions about them. The assumptions and models used for estimating fair value for share-based payment transactions are disclosed in Note 25.
40

30 June 2011 2.
2.4

Significant accounting estimates and judgements (contd) (vi) Impairment of investment in subsidiary and associated companies The Group assesses at each balance sheet date whether there is any objective evidence that the investments in a subsidiary is impaired. To determine whether there is objective evidence of impairment, the Group considers factors such as the industry/sector performance, operational and financing cash flow. Management will exercise significant judgement to evaluate the financial conditions and business prospects of the investments. Where there is objective evidence of impairment, the amount and timing of future cash flows are estimated based on the forecasted performance of the subsidiary company. The carrying amounts of the Groups investments in subsidiary and associated companies at the balance sheet date are disclosed in Notes 4 and 5 to the financial statements. (vii) Provision for warranty The Group recognises provision for warranty in accordance with the accounting policy stated in Note 2.18. The Group has made assumptions in relation to the expected costs of repair and maintenance. At 30 June 2011, the provision of $51,797 had been reversed as the warranty period has lapsed during the year.
2.5
Basis of consolidation Business combinations from 1 January 2010 Business combinations are accounted for by applying the acquisition method. Identifiable assets acquired and liabilities assumed in a business combination are measured initially at their fair values at the acquisition date. Acquisition-related costs are recognised as expenses in the periods in which the costs are incurred and the services are received. 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. Any contingent consideration to be transferred by the acquirer will be recognised at fair value at the acquisition date. Subsequent changes to the fair value of the contingent consideration which is deemed to be an asset or liability, will be recognised in accordance with FRS 39 either in profit or loss or as a change to other comprehensive income. If the contingent consideration is classified as equity, it is not remeasured until it is finally settled within equity. In business combinations achieved in stages, previously held equity interests in the acquiree are remeasured to fair value at the acquisition date and any corresponding gain or loss is recognised in profit or loss. The Group elects for each individual business combination, whether non-controlling interest in the acquiree (if any) is recognised on the acquisition date at fair value, or at the non-controlling interests proportionate share of the acquirees identifiable net assets. Any excess of the sum of the fair value of the consideration transferred in the business combination, the amount of non-controlling interest in the acquiree (if any), and the fair value of the Groups previously held equity interest in the acquiree (if any), over the net fair value of the acquirees identifiable assets and liabilities is recorded as goodwill. The accounting policy for goodwill is set out in Note 2.9. In instances where the latter amount exceeds the former, the excess is recognised as gain on bargain purchase in profit or loss on the acquisition date.
Annual Report 2011
41

30 June 2011 2.
2.5

Basis of consolidation (contd) Business combinations prior to 1 January 2010 In comparison to the above mentioned requirements, the following differences applied: Business combinations are accounted for by applying the purchase method. Transaction costs directly attributable to the acquisition formed part of the acquisition costs. The non-controlling interest (formerly known as minority interest) was measured at the proportionate share of the acquirees identifiable net assets. Business combinations achieved in stages were accounted for as separate steps. Adjustments to those fair values relating to previously held interests are treated as a revaluation and recognised in equity. Any additional acquired share of interest did not affect previously recognised goodwill. When the Group acquired a business, embedded derivatives separated from the host contract by the acquiree were not reassessed on acquisition unless the business combination resulted in a change in the terms of the contract that significantly modified the cash flows that otherwise would have been required under the contract. Contingent consideration was recognised if, and only if, the Group had a present obligation, the economic outflow was more likely than not and a reliable estimate was determinable. Subsequent adjustments to the contingent consideration were recognised as part of goodwill.
2.6
Transactions with non-controlling interests Non-controlling interest represents the equity in subsidiaries not attributable, directly or indirectly, to owners of the Company, and are presented separately in the consolidated statement of comprehensive income and within equity in the consolidated balance sheet, 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.
2.7
Foreign currency The Groups consolidated financial statements are presented in Singapore Dollars, which is also the Companys functional currency. Each entity in the Group determines its own functional currency and items included in the financial statements of each entity are measured using that functional currency. (a) Transactions and balances 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 end of the reporting period. Non-monetary items that are measured in terms of historical cost in a foreign currency are translated using the exchange rates as at the dates of the initial transactions. Non-monetary items measured at fair value in a foreign currency are translated using the exchange rates at the date when the fair value was determined.
42

30 June 2011 2.
2.7

Foreign currency (contd) (a) Transactions and balances (contd) Exchange differences arising on the settlement of monetary items or on translating monetary items at the end of the reporting period are recognised in profit or loss except for exchange differences arising on monetary items that form part of the Groups 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. (b) Consolidated financial statements For consolidation purpose, the assets and liabilities of foreign operations are translated into SGD at the rate of exchange ruling at the end of the reporting period and their profit or loss are translated at the exchange rates prevailing at the date of the transactions. The exchange differences arising on the translation are recognised in other comprehensive income. On disposal of a foreign operation, the component of other comprehensive income relating to that particular foreign operation is recognised in profit or loss. In the case of a partial disposal without loss of control of a subsidiary that includes a foreign operation, the proportionate share of the cumulative amount of the exchange differences are re-attributed to noncontrolling interest and are not recognised in profit or loss. For partial disposals of associates that are foreign operations, the proportionate share of the accumulated exchange differences is reclassified to profit or loss. The Group has elected to recycle the accumulated exchange differences in the separate component of other comprehensive income that arises from the direct method of consolidation, which is the method the Group uses to complete its consolidation.
2.8
Property, plant and equipment All items of property, plant and equipment are initially recorded at cost. Such cost includes the cost of replacing part of the property, plant and equipment and borrowing costs that are directly attributable to the acquisition of a qualifying property, plant and equipment. The accounting policy for borrowing costs is set out in Note 2.20. 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, plant and equipment and furniture and fixtures are measured at cost less accumulated depreciation and any accumulated impairment losses. Depreciation is computed on a straight-line basis over the estimated useful life of the asset as follows: Years Furniture and fittings Air conditioners Machinery, equipment and motor vehicles Office equipment and computers Communications equipment Renovations and electrical installations 5 3 3 1 - 10 - 10 - 10 - 10 2 3 - 10
Annual Report 2011
43

30 June 2011 2.
2.8

Property, plant and equipment (contd) Assets under construction included in plant and equipment are not depreciated as these assets are not yet available for use. Fully depreciated assets are retained in the financial statements until they are no longer in use. 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 de-recognition of the asset is included in the income statement in the year the asset is derecognised.
2.9
Intangible assets Goodwill Goodwill is initially measured at cost. accumulated impairment losses. Following initial recognition, goodwill is measured at cost less
For the purpose of impairment testing, goodwill acquired in a business combination is, from the acquisition date, allocated to each of the Groups cash-generating units that are expected to benefit from the synergies of the combination, irrespective of whether other assets or liabilities of the acquiree are assigned to those units. 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 income statement. 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 cash-generating 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 operation disposed of and the portion of the cash-generating unit retained. The Groups goodwill was fully impaired in prior year. 2.10 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 annual impairment assessment for an asset is required, the Group makes an estimate of the assets recoverable amount. An assets recoverable amount is the higher of an assets or cash-generating units fair value less costs to sell and its value in use and is determined for an individual asset, unless the asset does not generate cash inflows that are largely independent of those from other assets. Where the carrying amount of an asset or cash-generating unit exceeds its recoverable amount, the asset is considered impaired and is written down to its recoverable amount. 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.
44

30 June 2011 2.
2.10

Impairment of non-financial assets (contd) 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 assets 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 be recognised previously. Such reversal is recognised in the profit or loss.
2.11
Subsidiaries A subsidiary is an entity over which the Group has the power to govern the financial and operating policies so as to obtain benefits from its activities. In the Companys separate financial statements, investments in subsidiaries are accounted for at cost less impairment losses.
2.12
Associates An associate is an entity, not being a subsidiary or a joint venture, in which the Group has significant influence. An associate is equity accounted for from the date the Group obtains significant influence until the date the Group ceases to have significant influence over the associate. The Groups investments in associates are accounted for using the equity method. Under the equity method, the investment in associates is carried in the balance sheet at cost plus post-acquisition changes in the Groups share of net assets of the associates. Goodwill relating to associates is included in the carrying amount of the investment and is neither amortised nor tested individually for impairment. Any excess of the Groups share of the net fair value of the associates identifiable asset, liabilities and contingent liabilities over the cost of the investment is included as income in the determination of the Groups share of results of the associate in the period in which the investment is acquired. The profit or loss reflects the share of the results of operations of the associates. When the Groups share of losses in an associate equals or exceeds its interest in the associate, the Group does not recognise further losses, unless it has incurred obligations or made payments on behalf of the associate. After application of the equity method, the Group determines whether it is necessary to recognise an additional impairment loss on the Groups investment in its associates. The Group determines at each balance sheet date whether there is any objective evidence that the investment in the associate is impaired. If this is the case, the Group calculates the amount of impairment as the difference between the recoverable amount of the associate and its carrying value and recognises the amount in the profit or loss. The financial statements of the associate 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. Upon loss of significant influence over the financial and operation decision in the associate, the Group measures and recognises any retained investment at its fair value. Any difference between the carrying amount of the associate upon loss of significant influence and the fair value of the aggregate of the retained investment and proceeds from disposal is recognised in profit or loss.
Annual Report 2011
45

30 June 2011 2.
2.13

Affiliated companies An affiliated company is a company, not being a subsidiary or an associated company, in which one or more of the directors or shareholders of the Company have a significant equity interest or exercise significant influence.
2.14
Financial assets Initial recognition and measurement Financial assets are recognised when, and only when, the Group becomes a party to the contractual provisions of the financial instrument. The Group determines the classification of its financial assets at initial recognition. 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. Subsequent measurement Loans and receivables Non-derivatives 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, less impairment. Gains and losses are recognised in profit or loss when the loans and receivables are derecognised or impaired, as well as through the amortisation process. Available-for-sale financial assets Available-for-sale financial assets include equity investments, which are neither classified as held for trading nor designated at fair value through profit or loss. After initial recognition, available-for-sale financial assets are subsequently measured at fair value. Any gains or losses from changes in fair value of the financial asset 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. Investments in equity instruments whose fair value cannot be reliably measured are measured at cost less impairment loss. De-recognition A financial asset is derecognised where the contractual right to receive cash flows from the asset has expired. On de-recognition 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 has been recognised directly in other comprehensive income is recognised in profit or loss. All regular way purchases and sales of financial assets are recognised or derecognised on the trade date, ie the date that the Group commits to purchase or sell the asset. Regular way 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 concern.
46

30 June 2011 2.
2.15

Impairment of financial assets The Group assesses at each balance sheet date whether there is any objective evidence that a financial asset is impaired. Financial assets carried at amortised cost For financial assets carried at amortised cost, the Group first assesses individually whether objective evidence of impairment exists individually for financial assets that are individually significant, or collectively for financial assets that are not individually significant. If the Group determines that no objective evidence of impairment exists for an individually assessed financial asset, whether significant or not, it includes the asset in a group of financial assets with similar credit risk characteristics and collectively assesses them for impairment. Assets that are individually assessed for impairment and for which an impairment loss is, or continues to be recognised are not included in a collective assessment of impairment. If there is objective evidence that an impairment loss on loans and receivables carried at amortised cost has been incurred, the amount of the loss is measured as the difference between the assets carrying amount and the present value of estimated future cash flows discounted at the financial assets original effective interest rate. The carrying amount of the asset is reduced through the use of an allowance account. The amount of the loss is recognised in profit or loss. When the asset becomes uncollectible, the carrying amount of impaired financial assets is reduced directly or if an amount was charged to the allowance account, the amounts charged to the allowance account are written off against the carrying value of the financial asset. To determine whether there is objective evidence that an impairment loss on financial assets has been incurred, the Group considers factors such as the probability of insolvency or significant financial difficulties of the debtor and default or significant delay in payments. 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. Available-for-sale financial assets In the case of equity investments classified as available-for-sale, objective evidence of impairment include (i) significant financial difficulty of the issuer or obligor, (ii) information about significant changes with an adverse effect that have taken place in the technological, market, economic or legal environment in which the issuer operates, and indicates that the cost of the investment in equity instrument may not be recovered; and (iii) a significant or prolonged decline in the fair value of the investment below its costs. Significant is to be evaluated against the original cost of the investment and prolonged against the period in which the fair value has been below its original cost. If an available-for-sale financial asset is impaired, an amount comprising the difference between its acquisition cost (net of any principal repayment and amortisation) and its current fair value, less any impairment loss previously recognised in profit or loss, is transferred from other comprehensive income and recognised in profit or loss. Reversals of impairment losses in respect of equity instruments are not recognised in profit or loss; increase in their fair value after impairment are recognised directly in other comprehensive income.
Annual Report 2011
47

30 June 2011 2.
2.16

Cash and cash equivalents Cash and cash equivalents comprise cash on hand and at bank and demand deposits. These also include bank overdrafts that form an integral part of the Groups cash management.
2.17
Inventories Inventories 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 as follows: Raw materials purchase costs on a first-in, first-out basis; Finished goods and work-in-progress costs of direct materials and labour and a proportion of manufacturing overheads based on normal operating capacity. Where necessary, allowance is provided for damaged, obsolete and slow moving items to adjust the carrying value of inventories to the lower of cost and net realisable value. Net realisable value is the estimated selling price in the ordinary course of business, less estimated costs of completion and the estimated costs necessary to make the sale.
2.18
Provisions 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 resources embodying economic benefits will be required to settle the obligation and the amount of the obligation can be estimated reliably. Provisions are reviewed at each balance sheet 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. Provision for warranty Provisions for warranty-related costs are recognised when the product is sold or service provided.
2.19
Financial liabilities Initial recognition and measurement Financial liabilities are recognised when, and only when, the Group becomes a party to the contractual provisions of the financial instrument. The Group determines the classification of its financial liabilities at initial recognition. All financial liabilities are recognised initially at fair value plus in the case of financial liabilities not at fair value through profit or loss, directly attributable transaction costs. Subsequent measurement After initial recognition, other financial liabilities are subsequently measured at amortised cost using the effective interest rate method. Gains and losses are recognised in profit or loss when the liabilities are derecognised, and through the amortisation process.
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30 June 2011 2.
2.19

Financial liabilities (contd) De-recognition A financial liability is de-recognised when the obligation under the liability is discharged or cancelled or expires. 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 de-recognition 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.
2.20
Borrowing costs Borrowing costs are recognised as expenses in the period in which they are incurred. Borrowing cost consists of interest and other costs that an entity incurs in connections with the borrowing of funds.
2.21
Employee benefits (i) Defined contribution plan The Group participates in the national pension schemes as defined by the laws of the countries in which it has operations. In particular, the Singapore companies in the Group make contributions to the Central Provident Fund scheme in Singapore, 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. (ii) Employee share option plans Employees and directors 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 Groups 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 as at the beginning and end of that period and is recognised in employee benefits expense. 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 condition or non-vesting condition is satisfied, provided that all other performance and/or service conditions are satisfied. In the case where the option does not vest as the result of a failure to meet a non-vesting condition that is within the control of the Group or the employee, it is accounted for as a cancellation. In such case, the amount of the compensation cost that otherwise would be recognised over the remainder of the vesting period is recognised immediately in profit or loss upon cancellation. The employee share option reserve is transferred to retained earnings upon expiry of the share option. When the options are exercised, the employee share option reserve is transferred to share capital if new shares are issued.
Annual Report 2011
49

30 June 2011 2.
2.22

Leases The determination of whether an arrangement is, or contains a lease is based on the substance of the arrangement at inception date: whether fulfilment of the arrangement is dependent on the use of a specific asset or assets or the arrangement conveys a right to use the asset. For arrangements entered into prior to 1 January 2005, the date of inception is deemed to be 1 January 2005 in accordance with the transitional requirements of INT FRS 104. (i) 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. Capitalised leased assets are depreciated over the shorter of the estimated useful life of the asset and the lease term, if there is no reasonable certainty that the Group will obtain ownership by the end of 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. (ii) 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 leases 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(vi).
2.23
Revenue recognition 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, excluding sales taxes or duty. The Group assesses its revenue arrangements to determine if it is acting as principal or agent. The Group has concluded that it is acting as a principal in all of its revenue arrangements. The following specific recognition criteria must also be met before revenue is recognised: (i) Sale of goods Revenue from sale of goods is recognised upon the transfer of significant risk and rewards of ownership of the goods to the customer, usually on delivery of goods. 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. (ii) Tray recycling services Revenue on tray recycling services is recognised when the work is completed and the recycled items are delivered to the customer.
50

30 June 2011 2.
2.23

Revenue recognition (contd) (iii) Compressed natural gas supply products and services Revenue on compressed natural gas supply products is recognised upon the completion of installation and commissioning of the equipment, and transfer of title and risk of the compressed natural gas to the customer, usually on delivery. Revenue on services is recognised when services are rendered. (iv) Interest income Interest income is recognised using the effective interest method. (v) Management fees Management fees are recognised when services are rendered. (vi) Rental income Rental income is accounted for on a straight-line basis over the leased terms.
2.24
Taxes (i) Current tax Current income tax assets and liabilities for the current and prior periods 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 at the end of the reporting period, in the countries where the Group operates and generates taxable income. Current income 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. Management periodically evaluates positions taken in the tax returns with respect to situations in which applicable tax regulations are subject to interpretation and establishes provisions where appropriate. (ii) Deferred tax Deferred income tax is provided using the liability method on temporary differences at the balance sheet 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 income 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. Deferred income 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 income 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.
Annual Report 2011
51

30 June 2011 2.
2.24

Taxes (contd) (ii) Deferred tax (contd) The carrying amount of deferred tax assets is reviewed at the end of each reporting period 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 the end of each reporting period and are recognised to the extent that it has become probable that future taxable profit will allow the deferred tax asset to be recovered. 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 balance sheet date. Deferred income tax relating to items recognised outside profit or loss is recognised outside profit or loss. Deferred tax assets and deferred tax liabilities are offset, if a legally enforceable right exists to set off current income tax assets against current income tax liabilities and the deferred taxes relate to the same taxable entity and the same taxation authority. (iii) Sales tax Revenues, expenses and assets are recognised net of the amount of sales tax except: Where the sales tax incurred in a purchase of assets or services is not recoverable from the taxation authority, in which case the sales tax is recognised as part of the cost of acquisition of the asset or as part of the expense item as applicable; and Receivables and payables that are stated with the amount of sales tax included. The net amount of sales tax recoverable from, or payable to, the taxation authority is included as part of receivables or payables in the balance sheet.
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 deputy managers responsible for the performance of the respective segments under their charge. The deputy managers report directly to the CEO of the Company who regularly reviews 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 31, including the factors used to identify the reportable segments and the measurement basis of segment information.
2.26
Share capital and share issue expenses Proceeds from issuance of ordinary shares are recognised as share capital in equity. Incremental costs directly attributable to the issuance of ordinary shares are deducted against share capital.
2.27
Contingencies 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 on the balance sheet of the Group.
52

30 June 2011 2.
2.28

Related parties A party is considered to be related to the Group if: (a) The party, directly or indirectly through one or more intermediaries, (i) (ii) (iii) (b) (c) (d) (e) controls, is controlled by, or is under common control with, the Group; has an interest in the Group that gives it significant influence over the Group; or has joint control over the Group;
The party is an associate; The party is a member of the key management personnel of the Group or its parent; The party is a close member of the family of any individual referred to in (a) or (c); and The party is an entity that is controlled, jointly controlled or significantly influenced by or for which significant voting power in such entity resides with, directly or indirectly, any individual referred to in (c) or (d).
2.29
Government grants The Group received cash grant from government relating to the Jobs Credit Scheme. Government grant is recognised in profit or loss on a systematic basis over the periods in which the entity recognises as expenses the related costs for which the grants are intended to compensate. Grants related to income are presented as a credit in profit or loss as Other operating income.
Annual Report 2011
53
54
30 June 2011
Air conditioners $ Total $ Machinery, equipment and motor vehicles $ Communications equipment $ Assets under construction $ Office equipment and computers $ Renovations and electrical installations $ 125,938 66,279 (3,441) 188,776 (97,858) (5,326) 85,592 7,350,710 268,461 1,026,026 10,122,716 458,384 (794,043) 16,300 (1,320,302) (558,041) (574,304) 779,881 19,162 (115,096) (387,154) (28,332) 3,011,420 (688,178) (1,194,872) (102,344) 229,568 59,179 (187,768) (16,300) (25,500) 59,179 9,855,194 794,285 (388,872) (137,891) 873,813 4,754 (3,008) (89,507) (6,171) 937,235 (937,235) 3,038,335 8,000 (3,617) (31,298) 229,568 15,118,555 1,102,886 (405,411) (1,044,920) (182,280) 14,588,830 536,725 (988,849) (2,123,576) (2,479,633) (716,450) 8,817,047
3.
Property, plant and equipment
Group
Furniture and fittings $
Cost
At 1 July 2009 Additions Disposals Written off Translation difference
288,040 (13,531) (14,561) (3,479)
At 30 June 2010 and 1 July 2010 Additions Disposals Transfer Disposal of subsidiaries Written off Translation difference
256,469 (7,038) (216,208) (6,144)
At 30 June 2011
27,079
3.
Property, plant and equipment (contd)
Group
Furniture and fittings $ Total $
Air conditioners $
Machinery, equipment and motor vehicles $ Communications equipment $ Assets under construction $
Office equipment and computers $
Renovations and electrical installations $
Accumulated depreciation 124,106 4,749 (3,063) 125,792 23,893 (97,858) (5,561) 46,266 6,591,759 188,433 868,197 9,053,054 437,394 (768,066) (1,318,770) 157,049 (538,437) (430,465) 666,925 18,017 (93,867) 7,490 (382,614) (27,518) 2,780,476 16,917 (641,167) (1,194,872) (93,157) 8,365,750 499,048 (243,059) 514,352 (83,037) 690,382 53,312 (1,380) 9,447 (75,427) (9,409) 937,235 (937,235) 2,677,638 132,127 (2,329) (26,960) 13,052,564 695,333 (248,546) 528,287 (1,029,552) (125,771) 12,872,315 499,662 (775,104) (2,053,804) 166,153 (2,427,240) (562,834) 7,719,148
At 1 July 2010 Charge for the year Disposals Impairment Written off Translation difference
257,453 6,097 (4,107) 4,488 (14,561) (3,302)
At 30 June 2010 and 1 July 2010 Charge for the year Disposals Disposal of subsidiaries Impairment loss Written off Translation difference
246,068 3,441 (7,038) 1,614 (213,459) (6,133)
At 30 June 2011
24,493
Net book value 62,984 39,326 758,951 1,069,662 112,956 80,028 230,944 157,829 229,568 59,179 1,716,515 1,097,899
At 30 June 2010
10,401
At 30 June 2011
2,586
Annual Report 2011
30 June 2011
55

30 June 2011 3. Property, plant and equipment (contd)
Assets under finance lease During the year, the Group acquired property, plant and equipment with an aggregate cost of approximately $155,455 (2010: $89,510) using finance leases. The carrying amount of machinery, equipment and motor vehicles held under finance leases as at 30 June 2011 was approximately $279,088 (2010: $185,645). Leased assets are pledged as security for the related finance lease liabilities. Assets under construction During the year, the CNG refilling station has been fully constructed and disposed to a customer following the change in the intention of use. The gain on disposal amounting to $32,232 has been recognised in revenue. Impairment loss During the financial year, a subsidiary of the Group within the Natural Gas Vehicle (NGV) related business segment made impairment of its motor vehicles as this subsidiary had been making losses. The impairment loss amounting to $166,153 has been recognised in administrative expenses. In 2010, subsidiaries of the Group within the tray recycling segment made impairment of their machinery and equipment as these subsidiaries had been making losses. The impairment loss amounting to $528,287 has been recognised in administrative expenses. Office equipment and computer $
Company
Motor vehicles $
Furniture and fittings $
Total $
Cost At 1 July 2009 and 30 June 2010 Additions At 30 June 2011 Accumulated depreciation At 1 July 2010 and 30 June 2010 Depreciation charge for the year At 30 June 2011 Net book value At 30 June 2010 At 30 June 2011 699 37,835 33,106 37,835 33,805 4,729 4,729 6,136 6,136 6,136 4,729 10,865 699 699 37,835 37,835 6,136 6,136 43,971 699 44,670
56

30 June 2011 4. Investments in subsidiaries
Company 2011 $ Unquoted equity investments, at cost Less: Impairment loss Carrying amount of investments 9,264,170 (7,805,139) 1,459,031 2010 $ 9,264,170 (7,205,093) 2,059,077
During the financial year, management performed an impairment test for the investments in AM NGV (S) Pte Ltd and SO NGV (S) Pte Ltd as these subsidiaries had been persistently making losses. Full impairment losses of $600,000 and $46, respectively, were recognised to fully write down the carrying amount of these subsidiaries as based on the financial budgets approved by the management, these subsidiaries are unable to generate sufficient operating cash flows. For the year ended 30 June 2010, an impairment loss of $1,431,142 was written-off as a result of disposal of subsidiaries. (i) Details of the subsidiaries held by the Company at the end of the financial year are as follows: Country of incorporation and place of business Effective equity interest held by the Group 2011 2010 % %
Name of company
Principal activities
Cost of investment by the Company 2011 2010 $ $
Held by the Company Asian Micro (S) Pte Ltd (AMS) (1) Asian Micro (Thailand) Co., Ltd. (AMT) (2) Singapore Precision tray cleaning services Precision tray cleaning services and manufacturer of clean room grade polythene packaging materials Trading in natural gas vehicle (NGV) and compressed natural gas (CNG) supplies Trading in clean room supplies Currently inactive 100 100 3,865,290 3,865,290
Thailand
100
100
1,510,101
1,510,101
AM NGV (S) Pte Ltd (AM NGV (S)) (1)
Singapore
100
100
600,000
600,000
ACI Industries Pte Ltd (ACI) (1) Asian Micro Sdn. Bhd. (AMM) (3)
Singapore
100
100
168,387
168,387
Malaysia
100
100
2,765,013
2,765,013
Annual Report 2011
57

30 June 2011 4. Investments in subsidiaries (contd)
(i) Details of the subsidiaries held by the Company at the end of the financial year are as follows (contd): Country of incorporation and place of business Effective equity interest held by the Group 2011 2010 % %
Name of company
Held by the Company A-P Engineering Pte Ltd (APE) (3) SO NGV (S) Pte Ltd (SO NGV (S)) (1) AM NGV (T) Co., Ltd. (AM NGV (T)) (6) AM NGV Auto Sales (Thailand) Co., Ltd. (AM NGV Autosales (T)) (2) Singapore Currently under liquidation Currently inactive 80.1 80.1 105,263 105,263
Singapore
74
74
74
74
Thailand
Currently under liquidation Trading of NGV supplies
74
74
250,000
250,000
Thailand
49 (Note a)
49
42
42
9,264,170 (ii)
9,264,170
Details of the subsidiaries held by subsidiary companies at the end of the financial year are as follows: Country of incorporation and place of business Effective equity interest held by the Group 2011 2010 % %
Name of company
Held by subsidiary companies Micro Brite Technology Pte Ltd (MBT) (4) Asian Micro Technology (Wuxi) Co., Ltd (AMW) (3) Singapore Investment holding 100
Peoples Republic of China
Currently inactive
100
100
58

(ii) Details of the subsidiaries held by subsidiary companies at the end of the financial year are as follows (contd): Country of incorporation and place of business Effective equity interest held by the Group 2011 2010 % %
Name of company
Held by subsidiary companies Wuxi Asian Brite Technology Co., Ltd (ABT) (3) Peoples Republic of China Precision tray cleaning services and manufacture of clean room grade polythene packaging materials Precision tray cleaning services and manufacture of clean room grade polythene packaging materials Plastic waste collecting and recycling, and sales of scrap 100 100
Asian Micro Technology (Suzhou) Co., Ltd (AMSuzhou) (5)
100
Suzhou Asian Micro Recovery Technology Co., Ltd (SAMRT) (4)

(1) (2) (3) (4) (5) (6)
51
Audited by Ernst & Young LLP, Singapore Audited by J.C. Accounting Office, Thailand Not required to be audited by the laws of its country of incorporation Disposed off during the year AM Suzhou is a subsidiary of MBT, which has been disposed off Audited by local auditors in Thailand
Note (a): While the Group holds 49% of issued share capital in AM NGV Autosales (T), it has control over the financial and operational policies via the majority representation on the board of directors of AM NGV Autosales (T). Accordingly, AM NGV Autosales (T) is accounted for as a subsidiary of the Group.
Annual Report 2011
59

Disposals of MBT Group and SAMRT During the financial year, the Group disposed off its equity interests in Micro Brite Technology Pte Ltd (MBT) and its subsidiary, Asian Micro Technology (Suzhou) Co. Ltd (the MBT Group) and Suzhou Asian Micro Recovery Technology (SAMRT) for cash consideration of $1 and forgiveness of trade and other payables of $302,985 respectively. The disposals resulted in a gain on disposal amounting to $163,214. Values of the assets and liabilities of MBT Group and SAMRT at the date of disposal and cash flow effects were: 2011 $
SAMRT
Cash and cash equivalents Plant and equipment Other assets Total liabilities Carrying values of net liabilities Less: Forgiveness of trade and other payables Foreign currency reserve realised on disposal Gain on disposal of SAMRT
(1)
13,948 69,772 671,498 (500,307) 254,911 (302,985) (48,074) 5,962 (42,112)
MBT Group
Other assets Total liabilities Carrying values of net liabilities Less: Sale consideration Foreign currency reserve realised on disposal Allowance for doubtful trade and other receivables Gain on disposal of MBT Group MBT Group Sale consideration Less: Cash and cash equivalents Cash inflow Net gain on disposal of subsidiaries (Note 19(a)) Net cash outflow
(1)
317,417 (1,144,797) (827,380) (1) (827,381) (406,237) 1,112,516 (121,102)
(2)
1 1 (163,214) (13,948)
As at date of disposal, the Group recorded trade payables of $302,985 due to SAMRT. The buyer of SAMRT agreed to forgo the payables in exchange of the 51% equity interest in SAMRT. Upon disposal of MBT Group, the Group assessed the recoverability of the receivables from MBT Group and full allowance for doubtful trade and other receivables has been made.
(2)
60

Disposals of APP and AMPI In 2009, the Company disposed off its equity interest in A-P Precision Plastic Pte Ltd (APP) and Asian Micro Manufacturing Phils. Inc. (AMPI) for cash considerations of $1 and $3 (Peso 100) respectively. The disposals resulted in a loss on disposal of APP amounting to $329,251 and a gain on disposal of AMPI amounting to $550,731. Values of the assets and liabilities of APP and AMPI at the date of disposal and cash flow effects were: 2010 $ APP Cash and cash equivalents Non-current assets Liabilities Carrying values of net assets Less: Sale consideration Foreign currency reserve realised on disposal Loss on disposal of APP Sale consideration Less: Cash and cash equivalents Cash outflow AMPI Carrying value of net assets Less: Sale consideration Foreign currency reserve realised on disposal Gain on disposal of AMPI Cash inflow Net gain on disposal of subsidiaries (Note 19(a)) Net cash outflow (3) (3) (550,728) (550,731) 3 (221,480) (763) 767 347,496 (51,597) 296,666 (1) 296,665 32,586 329,251 1 (767) (766)
Annual Report 2011
61

30 June 2011 5(a) Investment in associated company
Group 2011 $ Unquoted equity investments, at cost At 1 July Share of post acquisition reserves Reclassified to other investments At 30 June Impairment loss At 1 July Reclassified to other investments At 30 June Carrying value at 30 June Details of associated company is as follows: Country of incorporation and place of business Effective equity interest held by the Group 2011 2010 % % 127,389 (59,283) 68,106 (68,106) 2010 $ 127,389 (59,283) 68,106 68,106 2011 $ 84,926 84,926 (84,926) Company 2010 $ 84,926 84,926 84,926
(68,106) 68,106
(68,106) (68,106)
(84,926) 84,926
(84,926) (84,926)
Name of company
Cost of investment 2011 2010 $ $
Suria Professional Service Centre Sdn. Bhd. (Suria) (1) Held by the Company Held by a subsidiary
Conversion of natural gas vehicles
Malaysia
20 7 27
84,926 42,463 127,389
(1)
Audited by a local firm in Malaysia.
During the financial year, the Group and the Company reclassified investment in associated company to other investments as the Group no longer has significant influence over the financial and operational decisions in this entity.
62

30 June 2011 5(a) Investment in associated company (contd)
The summarised financial information of the associate for 2010, not adjusted for the proportion of ownership interest held by the Group, is as follows: 2010 $ Assets and liabilities Current assets Non-current assets Total assets Current liabilities Total liabilities Results: Revenue Loss for the year 350,135 (110,538)
139,150 492,359 631,509 (1,215,766) (1,215,766)
5(b)
Other Investments
Group and Company 2011 $ Available for sale financial assets Unquoted equity investment At 1 July Reclassified from investment in associated company Impairment loss At 30 June The Group has 27% effective equity interest in Suria Professional Service Centre Sdn. Bhd. Further details of the associated company are given in Note 5(a) to the financial statements.
68,106 (68,106)
Annual Report 2011
63

30 June 2011 6. Inventories
Group 2011 $ Raw materials Work-in-progress Finished goods Total inventories at lower of cost and net realisable value 131,151 8,310 1,240,594 1,380,055 2010 $ 286,035 37,611 2,275,143 2,598,789
During the financial year, the Group wrote down $714,397 (2010: $248,037) of inventories which are recognised as expenses in the income statement. The Group also wrote off $Nil (2010: $123,494) of inventories which are recognised as expenses in the income statement. During the year, the Group reversed $8,066 being part of an inventory write-down made previously, as the inventories were sold to customers above their carrying amounts.
7.
Trade and other receivables

Group 2011 $ Trade and other receivables (current): Trade receivables Other debtors Deposits Due from subsidiaries (non-trade) (Note 8) Due from related parties (non-trade) (Note 8) Add: Cash and bank balances (Note 9) Total loans and receivables Trade receivables Trade receivables are non-interest bearing and are generally on 30 to 90 days terms. They are recognised at their original invoice amounts which represent their fair values on initial recognition. During the financial year, the Group wrote off $543 (2010: $175,835) of trade receivables which are recognised as expenses in the income statement. 2010 $ 2011 $ Company 2010 $
1,029,166 508,282 98,923 1,636,371 108,333 698,840 2,443,544
1,723,990 199,317 188,007 2,111,314 5,136 1,427,085 3,543,535
4,335 4,335 2,561 26,621 33,517
5,824 10,991 16,815 522,085 84,701 623,601
64

30 June 2011 7. Trade and other receivables (contd)
Allowance for doubtful trade and other receivables For the year ended 30 June 2011, the impairment loss recognised in the profit or loss for trade and other receivables was $12,639 (2010: $187,384) and $3,253 (2010: $12,453), respectively. As at 30 June 2011, trade receivables of the Group denominated in foreign currencies are as follows: Group 2011 $ Singapore dollars United States dollars 24,415 409,193 433,608 2010 $ 230,259 72,857 303,116
As at 30 June 2011, other receivables and deposits of the Group denominated in the foreign currencies are as follows: Group 2011 $ Singapore dollars United States dollars 73,700 7,248 80,948 Other receivables and deposits of the Company were denominated in its functional currency. The Groups trade and other receivables that are impaired at the balance sheet date and the movement of the allowance accounts are as follows: Group 2011 $ Movement in trade receivables allowance accounts: At 1 July Charge for the year Write-back Write-off Exchange differences At 30 June Movement in other receivables allowance accounts: At 1 July Charge for the year Write-off At 30 June 321,979 3,253 (245,000) 80,232 357,646 12,453 (48,120) 321,979 452,899 12,639 (6,207) (167,859) (17,025) 274,447 882,540 187,384 (262,266) (351,525) (3,234) 452,899 2010 $ 2010 $ 77,354 77,354
Annual Report 2011
65

30 June 2011 7. Trade and other receivables (contd)
The above represents a provision for individually impaired trade and other receivables whose carrying values aggregate $274,447 (2010: $452,899) and $80,232 (2010: $321,979) respectively as at year end. Trade and other receivables that are individually determined to be impaired at the balance sheet date relate to debtors that are in significant financial difficulties and have defaulted on payments. These receivables are not secured by any collateral or credit enhancements. Receivables that are past due but not impaired The Group has trade receivables amounting to $341,342 (2010: $602,818) that are past due at the balance sheet date but not impaired. These receivables are unsecured and the analysis of their aging at the balance sheet date is as follows: Group 2011 $ Trade receivables past due: Less than 30 days 30 to 60 days 61 to 90 days 91 to 120 days More than 120 days 2010 $
228,219 52,015 6,697 1,825 52,586 341,342
293,442 136,792 43,616 47,065 81,903 602,818
8.
Due from/(to) subsidiaries (non-trade) Due from/(to) related parties (non-trade) Loan from directors (non-trade) Loan from related party (non-trade) (non-current)
These amounts are unsecured and are to be settled in cash. These amounts are interest-free and are repayable on demand except for the loan from related party. The loan from related party bears interest at prevailing market interest rate of 5.25% as at year end and the related party has agreed not to recall for repayment until end of October 2012. During the financial year, the Company entered into an agreement with two executive directors to capitalise a portion of the loan from directors of $367,584 by the issuance of new ordinary shares at $0.015 each in the share capital of the Company. (See Note 15) Due from subsidiaries (non-trade) are stated after deducting the following allowance for doubtful receivables: Company 2011 $ Movement of allowance for doubtful receivables Balance at 1 July Provision during the year Write back during the year Written-off during the year Balance at 30 June 20,060,499 3,019,677 23,080,176 18,862,457 8,165,295 (4,171,215) (2,796,038) 20,060,499 2010 $
66

30 June 2011 8. Due from/(to) subsidiaries (non-trade) Due from/(to) related parties (non-trade) Loan from directors (non-trade) Loan from related party (non-trade) (non-current) (contd)
Due from related parties (non-trade) are stated after deducting the following allowance for doubtful receivables: Group 2011 $ Movement of allowance for doubtful receivables Balance at 1 July Provision during the year Written-off during the year Balance at 30 June 1,511,316 (398,800) 1,112,516
There is no allowance for doubtful debts for amount due from related parties (non-trade) being recorded in 2010. Movement of allowance for doubtful debts for amount due from related parties are recognised in other operating income as gain on disposal of subsidiaries.
9.
Cash and cash equivalents

Cash and cash equivalents as at 30 June were as follows: Group 2011 $ Cash and bank balances Fixed deposits Less: Fixed deposits pledged* Cash and cash equivalents 271,807 427,033 698,840 (427,033) 271,807 2010 $ 1,050,113 376,972 1,427,085 (376,972) 1,050,113 2011 $ 955 25,666 26,621 (25,666) 955 Company 2010 $ 8,550 76,151 84,701 (76,151) 8,550
* This relates to fixed deposits pledged in connection with credit facilities granted by banks (Note 11).
Cash at bank earns interest at rates based on daily bank deposit rates ranging from 0.00% to 0.25% (2010: 0.00% to 0.25%) per annum. As at 30 June 2011, cash and bank balances of the Group and the Company denominated in foreign currencies are as follows: Group 2011 $ Singapore dollars United States dollars 25,794 81,560 107,354 2010 $ 133,481 247,795 381,276
Annual Report 2011
67

30 June 2011 9. Cash and cash equivalents (contd)
Cash and cash equivalents of the Company were denominated in its functional currency. Fixed deposits are placed with financial institutions for varying periods of between 1 month to 1 year depending on the immediate cash requirements of the Group. The fixed deposits earn interest at fixed deposit rates ranging from 0.00% to 0.625% (2010: 0.75% to 0.94%) per annum for SGD fixed deposits and from 2.25% to 2.5% (2010: 0.50% to 0.75%) per annum for Thai Baht (THB) fixed deposits.
10.
Trade and other payables

Group 2011 $ Trade and other payables: Trade payables Other payables Total trade and other payables Add: - Loan from directors (non-trade) (Note 8) - Due to subsidiaries (non-trade) (Note 8) - Due to related parties (non-trade) (Note 8) - Bills payable to bank (Note 11) - Accrued expenses (Note 13) Obligation under finance lease (Note 12) - current - non-current Loan from related party (non-trade) (non-current) (Note 8) Total financial liabilities carried at amortised cost Trade payables Trade payables are non-interest bearing and are normally settled on 30 to 90 day terms. In 2010, the Company entered into an agreement with a creditor to capitalise the debts of $370,713 owing to the creditor by a subsidiary, by the issuance of new ordinary shares of $0.028 each in the share capital of the Company. 2010 $ 2011 $ Company 2010 $
707,690 1,069,957 1,777,647
988,060 1,240,226 2,228,286
149,488 149,488
200,669 200,669
784,828 455,833 920,001
400,472 161,706 916,353 1,913,654
1,420,451 582,277
1,129,431
72,884 168,393 300,000 4,479,586
129,424 104,815 5,854,710
7,184 15,740 2,175,140
6,555 22,925 1,359,580
68

30 June 2011 10. Trade and other payables (contd)
Trade payables (contd) As at 30 June 2011, trade payables of the Group denominated in foreign currencies are as follows: Group 2011 $ Singapore dollars United States dollars Euro dollar 122,837 122,837 Other payables Other payables are non-interest bearing and are normally settled on 30 to 90 day terms. As at 30 June 2011, other payables of the Group and the Company denominated in foreign currencies are as follows: Group 2011 $ Singapore dollars Other payables of the Company were denominated in its functional currency. 410,328 2010 $ 372,050 2010 $ 18,672 234,222 2,737 255,631
11.
Bills payable to banks

The bills payable are secured and have repayment terms of less than 12 months. As at 30 June 2011, bills payable of the Group denominated in foreign currency are as follows: Group 2011 $ United States dollars 354,547 2010 $ 759,716
Interest on bills payable to banks was charged at 2.88% to 6.75% (2010: 5.25%) per annum. The Groups trading facilities are secured by: (i) (ii) (iii) (iv) corporate guarantee of $2,540,000 (2010: $2,100,000) from the Company; fixed deposits from the Group and the Company of $427,033 (2010: $376,972) and $25,666 (2010: $76,151) respectively; a legal mortgage over a property of an affiliated company, American Converters Industries Pte Ltd (owned by two directors of the Company); and joint and several guarantee of $440,000 from the two directors of the Company. Annual Report 2011
69

30 June 2011 12. Obligations under finance leases
Average effective interest rate % p.a.
Maturity 2011 $
Group 2010 $
Company 2011 2010 $ $
Current: Obligations under finance leases (secured) (Note 26(b)) Non-current: Obligations under finance leases (secured) (Note 26(b))
7.19%
2012
72,884
129,424
7,184
6,555
7.19%
2013 - 2016
168,393
104,815
15,740
22,925
Obligations under finance leases These obligations are secured by a charge over the leased assets (Note 3).
13.
Accrued expenses
Group 2011 $ Accrued expenses Accrued personnel expenses 578,864 341,137 920,001 2010 $ 866,400 1,047,254 1,913,654 2011 $ 332,477 249,800 582,277 Company 2010 $ 284,520 844,911 1,129,431
Accrued personnel expenses include executive directors salaries payable of $246,637 (2010: $842,343) to two executive directors of the Company (See Note 2.1). During the financial year, the Company entered into an agreement with two executive directors to capitalise the directors salaries payable of $1,132,416 (2010: $150,000), by the issuance of new ordinary shares at $0.015 (2010: $0.027) each in the share capital of the Company.
70

30 June 2011 14. Provision
Group Provision for warranty 2011 2010 $ $ At 1 July Arose during the financial year Unused amount reversed At 30 June 51,797 (51,797) 51,797 51,797
During the financial year, the Group reversed the provision for warranty as the warranty period has lapsed.
15.
Share capital
Number of shares 2011 2010 Group and Company 2011 2010 $ $
Issued and fully paid ordinary shares: At 1 July Capitalisation of Trade payables Directors salaries Loan from directors At 30 June 363,591,043 75,494,400 24,505,600 463,591,043 344,795,487 13,240,000 5,555,556 363,591,043 37,173,928 1,132,416 367,584 38,673,928 36,653,215 370,713 150,000 37,173,928
During the financial year, the Company capitalised the directors salaries payable to certain executive directors and a portion of the loan from directors of $1,132,416 (2010: $150,000), and $367,584, respectively, by the issuance of new ordinary shares at $0.015 (2010: $0.027) each in the share capital of the Company. In 2010, the Company capitalised trade payables of $370,713 by the issuance of new ordinary shares at $0.028 each in the share capital of the Company. The holders of ordinary shares are entitled to receive dividends as and when declared by the Company. All ordinary shares carry one vote per share without restriction. The ordinary shares have no par value. The Company has an employee share option plan (Note 25) under which options to subscribe for the Companys ordinary shares have been granted to employees.
Annual Report 2011
71

30 June 2011 16. Share option reserve
Share option reserve represents the equity-settled share options granted to employees (Note 25). 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 of the share options to retained earnings. Group and Company 2011 2010 $ $ At 1 July Grant of equity-settled share options Expiry of share options At 30 June 212,944 219,835 (42,792) 389,987 255,580 110,099 (152,735) 212,944
17.
Premium paid on acquisition of non-controlling interests

The Group adopted the entity concept method to account for additional shares in subsidiary acquired from a minority shareholder. The acquisition of additional shares from the minority shareholder is treated as a transaction between owners and the difference between the cost of the additional interests in the subsidiary acquired and the share of the assets and liabilities acquired from the non-controlling interests is reflected as premium arising from the acquisition of the non-controlling interests. Upon disposal of the subsidiary in the financial year, the Group transferred the premium arising from the acquisition of non-controlling interests in prior year to accumulated losses.
18.
Revenue
Group 2011 $ 2010 $ (Reclassified) 12,721,499 2,424,104 4,972,419 585,603 20,703,625
Natural Gas Vehicle (NGV) related business Sales of manufactured goods Tray recycling services Plastic scrap recovery
2,895,005 2,013,949 3,483,007 183,107 8,575,068
72

30 June 2011 19. Other operating (income)/expenses
(a) Other operating income comprises the following: Group 2011 $ 2010 $ (Reclassified) (13,084) (262,266) (221,480) (73,831) (230,806) (35,294) (836,761)
Gain on disposal of property, plant and equipment Write back of allowance for doubtful debts Write back of allowance for stocks obsolescence Gain on disposal of subsidiaries Write back of provision of warranty Sales of scrap Waiver of payables Claim from insurance Jobs credit
(91,000) (6,207) (8,066) (163,214) (51,797) (101,441) (2,050) (35,891) (459,666)
In 2009, the Singapore Finance Minister announced the introduction of a Jobs Credit Scheme (Scheme). Under the Scheme, the Group received a 12% cash grant on the first $2,500 of each months wages for each employee on their Central Provident Fund payroll. The Scheme ceased with the final payment in June 2010. During the financial year ended 30 June 2010, the Group received its grant income of $35,294 under the Scheme. (b) Other operating expenses comprises the following: Group 2011 $ 2010 $ (Reclassified) 12,453 123,494 403,046 187,384 248,037 175,835 15,368 51,797 41,049 1,258,463
Allowance for doubtful debts (non-trade) Stocks written off Foreign exchange loss Allowance for doubtful debts (trade) Allowance for stocks obsolescence Write off of doubtful debts Fixed assets written off Provision for warranty Others
3,253 1,672,237 12,639 714,397 543 52,393 60,423 2,515,885
Annual Report 2011
73

30 June 2011 20. Loss before taxation
The following items have been included in arriving at loss before tax from operations: Group 2011 $ Cost of inventories sold Depreciation of property, plant and equipment Operating lease expense Salaries and bonuses Central Provident Fund contributions Share-based payments Other personnel expenses Impairment of property, plant and equipment 3,146,094 499,662 639,566 2,789,118 164,943 219,835 91,601 166,153 2010 $ 10,851,699 695,333 671,873 2,562,978 220,225 110,099 44,469 528,287
Included in the above is compensation of key management personnel as disclosed in Note 27(b).
21.
Financial expenses/(income)
Group 2011 $ Financial expenses Interest expense on: - bank overdrafts - finance leases - short term bank loans - late interest charges - bills payable to banks - others Bank charges 2,267 16,910 1,524 21,783 5,220 47,704 19,637 67,341 Financial income Interest income from - fixed deposits and bank balances (3,290) (3,590) 14 40,288 16,879 21,943 79,124 46,563 125,687 2010 $
74

30 June 2011 22. Directors remuneration
The number of directors of the Company whose emoluments fall within the following bands: 2011 $ $500,000 and above $250,000 to $499,999 Below $250,000 2 6* 8
* Includes directors resigned during the year.
2010 $ 1 1 5* 7
23.
Taxation
Major components of income tax expense for the year ended 30 June were: Group 2011 $ Current income tax - (over)/under provision in respect of prior years 2010 $
(211,103)
70,621
A reconciliation of the tax expense and the product of accounting profit multiplied by the applicable tax rate is as follows: Group 2011 $ Loss before tax Tax at the applicable tax rate of 17% Tax effect of expenses not deductible for tax purposes Tax effect on income not subject to tax (Over)/under provision of tax in respect of prior year Utilisation of deferred tax assets previously not recognised Deferred tax assets not recognised Effects of different tax rates in other countries Tax expense (4,640,163) (788,828) 519,957 (47,466) (211,103) 688,744 (372,407) (211,103) 2010 $ (3,011,037) (511,876) 217,695 (40,068) 70,621 (31,804) 431,342 (65,289) 70,621
Annual Report 2011
75

30 June 2011 23. Taxation (contd)
Deferred taxation at 30 June relate to the following: Group 2011 $ Deferred tax liabilities - excess of net book value over tax written down value of fixed assets Deferred tax liabilities The Group As at 30 June 2011, the Group has unutilised tax losses and unutilised capital allowances of approximately $19,961,000 (2010: $15,909,000) and $28,000 (2010: $28,000), which are available for offset against future taxable profits, subject to agreement by the tax authorities and compliance with certain provisions of the tax legislation of the respective countries in which the Group operates. No deferred tax is recognised on these losses and unutilised capital allowances in accordance with the accounting policy as set out in Note 2.24(ii). Management intends to transfer unabsorbed capital allowances and trade losses of $193,000 (2010: $ Nil) from a subsidiary to a certain other subsidiary under the group relief system, subject to compliance with relevant rules and procedures and agreement of the Inland Revenue Authority of Singapore. 2010 $ 2011 $ Company 2010 $
(585) (585)
(581) (581)
(585) (585)
(581) (581)
24.
Loss per share

Basic loss per share is calculated by dividing the loss for the year, net of tax, attributable to equity holders of the parent by the weighted average number of ordinary shares outstanding during the financial year. Diluted loss per share amounts is calculated by dividing the loss for the year, net of tax, attributable to owners of the parent by the weighted average number of ordinary shares outstanding during the year plus weighted average number of ordinary shares that would be issued on the conversion of all the dilution potential shares into ordinary shares. The following table reflects the loss and share data used in the computation of basic and diluted loss per share for the years ended 30 June: Group 2011 $ Net loss attributable to owners of the parent used in the computation of basic and diluted loss per share Weighted average number of ordinary shares for basic and diluted loss per share 2010 $
(3,896,590)
(3,023,458)
414,275,975
360,690,124
For the year ended 30 June 2011, 33,957,000 (2010: 22,307,000) of share options granted to employees under the existing employee share option scheme have not been included in the calculation of diluted loss per share because they are anti-dilutive for the current financial year presented.
76

30 June 2011 25. Employee benefits
The Company has 2 employee share option schemes, Asian Micro Holdings Limited Employees Share Option Scheme (the ESOS 2001), and Asian Micro Holdings Limited Employees Share Option Scheme 2010 (the ESOS 2010) to confirmed staff. Asian Micro Holdings Limited Employees Share Option Scheme (the ESOS 2001) The exercise price of the options is set above the average market price for the 5 consecutive trading days immediately preceding the offering date of the option. The options may be exercisable immediately or at any time from 1 to 3 years beginning on the first anniversary of the date of grant up to 28 September 2011. Options granted are cancelled when the option holder ceases to be under full time employment of the Company or any corporation in the Group subject to certain exceptions at the discretion of the Company. There are no cash settlement alternatives. There has been no modification to the scheme during both 2011 and 2010. Asian Micro Holdings Limited Employees Share Option Scheme (2010) (the ESOS 2010) The exercise price of the options is set at the average market price for the 5 consecutive trading days immediately preceding the offering date of the option. The options may be exercisable immediately or at any time from 1 to 10 years beginning on the first anniversary of the date of grant up to 28 October 2020. Options granted are cancelled when the option holder ceases to be under full time employment of the Company or any corporation in the Group subject to certain exceptions at the discretion of the Company. There are no cash settlement alternatives. There has been no modification to the scheme during the year. Information with respect to the number of options granted under both schemes is as follows: Balance at 1 July 2010 Options issued during the year Options forfeited during the year Options exercised during the year Balance at 30 June 2011
Date granted ESOS 2001 October 2001
Option exercise period
Exercise price
October 2002 September 2011 November 2002 September 2011 May 2003 September 2011 June 2003 September 2011 August 2004 September 2011
$0.050
800,000
800,000
November 2001 May 2002
$0.060
152,000
152,000
$0.180
56,000
56,000
June 2002
$0.165
68,000
68,000
August 2003
$0.065
21,000
21,000
Annual Report 2011
77

30 June 2011 25. Employee benefits (contd)
Balance at 1 July 2010 574,000 Options issued during the year Options forfeited during the year Options exercised during the year Balance at 30 June 2011 574,000
Date granted August 2003
Option exercise period August 2004 September 2011 October 2004 September 2011 October 2006 September 2011 May 2008 September 2011 June 2008 September 2011 June 2008 September 2011 July 2009 September 2011 September 2009 September 2011 December 2010 September 2011
Exercise price $0.070
October 2003 October 2005 May 2007
$0.090
2,646,000
2,646,000
$0.090
525,000
525,000
$0.090
550,000
550,000
June 2007
$0.100
230,000
230,000
June 2007
$0.105
200,000
200,000
July 2008
$0.050
675,000
675,000
September 2008 December 2009
$0.050
50,000
50,000
$0.030
15,760,000 22,307,000
(7,800,000) (7,800,000)
7,960,000 14,507,000
ESOS 2010 November 2010 November 2011 November 2020 $0.015 25,450,000 (6,000,000) 19,450,000
78

30 June 2011 25. Employee benefits (contd)
Movement of share options during the year The following table illustrates the number and weighted average exercise prices (WAEP) of, and movements in, share options during the year. No. 2011 ESOS 2001 Outstanding at beginning of year Granted during the year Forfeited during the year Outstanding at end of year ESOS 2010 Granted during the year (3) Forfeited during the year Outstanding at end of year
(1)
WAEP($) 2011
No. 2010
WAEP($) 2010
(1)
22,307,000 (7,800,000) 14,507,000
0.04 0.03 0.06
9,538,000 16,400,000 (3,631,000) 22,307,000
0.08 0.03 0.08 0.04
(2)
25,450,000 (6,000,000)
(4)
0.02 0.02 0.02
19,450,000
Included within these balances are equity-settled options that were not recognised in accordance with FRS102 as these equity-settled options were granted on or before 22 November 2002. These options have not been subsequently modified and therefore do not need to be accounted for in accordance with FRS102. The range of exercise prices for options outstanding at the end of the year was $0.03 to $0.18 (2010: $0.03 to $0.18). The weighted average remaining contractual life for these options approximates 3 months (2010: 1 year). The weighted average fair value of options granted during the year was $0.015. The exercise price for options outstanding at the end of the year was $0.015. The weighted average remaining contractual life for these options is 9 years.
(2)
(3)
(4)
Fair value of share options granted The fair value of share options as at the date of grant is estimated using the Binomial Option Pricing Model, taking into account the terms and conditions upon which the options were granted. The inputs to the model used for the years ended 30 June 2011 and 30 June 2010 are shown below. 2011 Dividend yield % (year) Expected volatility (%) Risk-free interest rate (%) Expected life of option (years) Share price ($) 0.0 121 1.6 5.5 0.02 2010 0.0 60 5.0 1.8 0.02
The expected life of the options is based on historical data and is not necessarily indicative of exercise patterns that may occur. The expected volatility reflects the assumption that the historical volatility is indicative of future trends, which may also not necessarily be the actual outcome.
Annual Report 2011
79

30 June 2011 26. Commitments and contingencies
(a) Operating lease commitments as lessee The Group leases certain properties under lease agreements. These leases have an average life of between 1 and 5 years with no renewal option or escalation clauses included in the contracts. There are no restrictions placed upon the Group or the Company by entering into these leases. Operating lease payments recognised in the consolidated profit or loss during the year amounted to $639,566 (2010: $671,873). Future minimum lease payments under non-cancellable operating leases as at 30 June are as follows: Group 2011 $ Within one year After one year but not more than five years 569,155 105,300 674,455 2010 $ 683,136 717,986 1,401,122
The Group has not entered into any non-cancellable leases as lessee. Rental income is generated on an adhoc basis. (b) Finance lease commitments The Group has finance leases for certain items of machinery, equipment and motor vehicles (Note 3). There are no restrictions placed upon the Group by entering into these leases. The average discount rate implicit in the leases is 7.19% (2010: 4.46%) per annum. Future minimum lease payments under finance leases together with the present value of the net minimum lease payments are as follows: Group Minimum lease payments 2011 $ Not later than one year Later than one year but not later than five years Total minimum lease payments Less: Amounts representing finance charges Present value of minimum lease payments 87,187 183,951 271,138 (29,861) 241,277 Present value of payments 2011 $ 72,884 168,393 241,277 241,277 Minimum lease payments 2010 $ 142,048 113,813 255,861 (21,622) 234,239 Present value of payments 2010 $ 129,424 104,815 234,239 234,239
80

30 June 2011 26. Commitments and contingencies (contd)
(b) Finance lease commitments (contd) Company Present Minimum value of lease payments payments 2011 2010 $ $ 7,184 15,740 22,924 22,924 8,928 26,028 34,956 (5,476) 29,480
Minimum lease payments 2011 $ Not later than one year Later than one year but not later than five years Total minimum lease payments Less: Amounts representing finance charges Present value of minimum lease payments (c) Continuing financial support 8,928 17,100 26,028 (3,116) 22,912
Present value of payments 2010 $ 6,555 22,925 29,480 29,480
As at 30 June 2011, the Company had given undertakings to certain subsidiaries to provide financial support to enable them to operate as going concerns and to meet their obligations for at least 12 months from the respective date of their directors report.
27.
Related party disclosures

An entity or individual is considered a related party of the Group for the purposes of the financial statements if: (i) it possesses the ability (directly or indirectly) to control or exercise significant influence over the operating and financial decisions of the Group or vice versa; or (ii) it is subject to common control or common significant influence. The following are the significant intercompany transactions entered into by the Group with its related parties: (a) Sales and purchases of goods and services Group 2011 $ Rental expense paid/payable to affiliated companies * Sale of goods 419,382 97,035 2010 $ 489,960 11,673
* The Group has entered into contracts with affiliated companies, Asian Micro Industries (Thailand) Co., Ltd, Ultraline Technology Pte Ltd, American Converters Industries Pte Ltd and Ultraline Holdings (Thailand) Co. Ltd, all three companies owned by two directors, for the lease of factories on a time cost reimbursement basis.
Annual Report 2011
81

30 June 2011 27. Related party disclosures (contd)
(b) Compensation of key management personnel Group 2011 $ Short-term employee benefits Central provident fund contributions Share-based payments Total compensation paid to key management personnel Comprise amounts for: - Directors of the Company - Other key management personnel 1,186,983 89,296 87,397 1,363,676 2010 $ 1,427,494 47,201 87,257 1,561,952
935,085 428,591 1,363,676
1,118,715 443,237 1,561,952
28.
Financial risk management objectives and policies

The Group and the Company is exposed to financial risks arising from its 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. The Audit Committee provides independent oversight to the effectiveness of the risk management process. The following sections provide details regarding the Groups and Companys exposure to the abovementioned financial risks and the objectives, policies and processes for the management of these risks. There has been no change to the Groups exposure to these financial risks or the manner to which it manages and unearned the risks. Credit risk Credit risk is the risk of loss that may arise on outstanding financial instruments should a counterparty default on its obligations. The Groups and the Companys exposure to credit risk arises primarily from trade and other receivables. For other financial assets (including cash and cash equivalents), the Group and the Company minimise credit risk by dealing exclusively with high credit rating counterparties. The Groups 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. Trade and other receivable balances are monitored on an ongoing basis with the result that the Groups exposure to bad debts is not significant. Exposure to credit risk At the balance sheet date, the Groups and the Companys maximum exposure to credit risk is represented by: the carrying amount of each class of financial assets recognised in the balance sheets and a nominal amount of $2,540,000 (2010: $2,100,000) relating to a corporate guarantee provided by the Company to a bank on a subsidiarys bank facility.
82

30 June 2011 28. Financial risk management objectives and policies (contd)
Credit risk (contd) Credit risk concentration profile The Group determines concentrations of credit risk by monitoring the country and industry sector profile of its trade receivables on an on-going basis. The credit risk concentration profile of the Groups trade receivables at the balance sheet date is as follows: Group 2011 $ By country: Singapore Thailand Peoples Republic of China 860,961 168,205 1,029,166 84 16 100 1,361,475 252,974 109,541 1,723,990 79 15 6 100 % of total $ 2010 % of total
At the balance sheet date, approximately 38% (2010: 28%) of the Groups trade receivables were due from 3 major customers. Financial assets that are neither past due nor impaired Trade and other receivables that are neither past due nor impaired are creditworthy debtors with good payment record with the Group. Cash and bank balances, that are neither past due nor impaired, are placed with or entered into with reputable financial institutions or companies 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 7 (Trade and other receivables). 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 Groups and the Companys exposure to liquidity risk arises primarily from mismatches of the maturities of financial assets and liabilities. The Groups and the Companys objective is to maintain a balance between continuity of funding and flexibility through the use of stand-by credit facilities.
Annual Report 2011
83

Liquidity risk (contd) The table below summarises the maturity profile of the Groups and the Companys financial assets and liabilities at the balance sheet date based on contractual undiscounted repayment obligations. 2011 1 year or less $ Group Financial assets Trade and other receivables Due from related parties (non-trade) Fixed deposits Cash and bank balances Total undiscounted financial assets Financial liabilities Trade and other payables Accrued expenses (non-trade) Due to related parties Bills payable to bank Obligations under finance lease Loan from related party (non-trade) Total undiscounted financial liabilities Total net undiscounted financial liabilities Company Financial assets Trade and other receivables Due from related parties (non-trade) Fixed deposits Cash and bank balances Total undiscounted financial assets Financial liabilities Trade and other payables Accrued expenses Due to subsidiaries (non-trade) Obligations under finance lease Total undiscounted financial liabilities Total net undiscounted financial liabilities 149,488 582,277 1,420,451 8,928 2,161,144 (2,127,627) 17,100 17,100 (17,100) 149,488 582,277 1,420,451 26,028 2,178,244 (2,144,727) 4,335 2,561 25,666 955 33,517 4,335 2,561 25,666 955 33,517 1,777,647 920,001 784,828 455,833 87,187 4,025,496 (1,581,952) 183,951 300,000 483,951 (483,951) 1,777,647 920,001 784,828 455,833 271,138 300,000 4,509,447 (2,065,903) 1,636,371 108,333 427,074 271,766 2,443,544 1,636,371 108,333 427,074 271,766 2,443,544 1 to 5 years $ Over 5 years $ Total $
84

Liquidity risk (contd) 2010 1 year or less $ Group Financial assets Trade and other receivables Due from related parties (non-trade) Fixed deposits Cash and bank balances Total undiscounted financial assets Financial liabilities Trade and other payables Accrued expenses Loan from directors (non-trade) Due to related parties (non-trade) Bills payable to bank Obligations under finance lease Total undiscounted financial liabilities Total net undiscounted financial liabilities Company Financial assets Trade and other receivables Due from subsidiaries (non-trade) Fixed deposits Cash and bank balances Total undiscounted financial assets Financial liabilities Trade and other payables Accrued expenses Obligations under finance lease Total undiscounted financial liabilities Total net undiscounted financial liabilities 16,815 522,085 76,151 8,550 623,601 16,815 522,085 76,151 8,550 623,601 2,111,314 5,136 376,972 1,050,113 3,543,535 2,111,314 5,136 376,972 1,050,113 3,543,535 1 to 5 years $ Over 5 years $ Total $
2,228,286 1,913,654 400,472 161,706 916,353 142,048 5,762,519 (2,218,984)
113,813 113,813 (113,813)
2,228,286 1,913,654 400,472 161,706 916,353 255,861 5,876,332 (2,332,797)
200,669 1,129,431 8,928 1,339,028 (715,427)
26,028 26,028 (26,028)
200,669 1,129,431 34,956 1,365,056 (741,455)
Annual Report 2011
85

Interest rate risk Interest rate risk is the risk that the fair value or future cash flows of the Groups and the Companys financial instruments will fluctuate because of changes in market interest rates. The Groups and the Companys exposure to interest rate risk arises primarily from their obligations under finance lease. The Groups and the Companys policy is to manage interest cost using fixed rate debts. Foreign currency risk The Group has transactional currency exposures arising from sales or purchases that are denominated in a currency other than the respective functional currencies of Group entities, primarily SGD, THB, USD and Renminbi (RMB). The foreign currencies in which these transactions are denominated are mainly U.S Dollars (USD). Approximately 37% (2010: 24%) of the Groups sales are denominated in foreign currencies whilst 54% (2010: 14%) of purchases are denominated in the respective functional currencies of the Group entities. The Group has trade receivables, trade payables and bills payable to bank denominated in foreign currency. At the balance sheet date, trade receivables, trade payables and bills payable to bank denominated in foreign currency balances (mainly in USD) amounted to $433,608, $122,877 and $354,547 (2010: $303,116, $255,631 and $759,716) respectively. The Group and the Company also hold cash denominated in foreign currencies for working capital purposes. At the end of the reporting period, such foreign currency balances are mainly in USD. The Group is also exposed to currency translation risk arising from its net investments in foreign operations, including Malaysia, Peoples Republic of China (PRC) and Thailand. The Groups net investments in Malaysia, PRC and Thailand are not hedged. Sensitivity analysis for foreign currency risk The following table demonstrates the sensitivity to a reasonably possible change in the USD and RMB, with all other variables held constant, of the Groups loss net of tax. Group Loss net of tax 2011 2010 $000 $000 USD - strengthened 12% (2010: 3%) - weakened 12% (2010: 3%) RMB - strengthened 8% (2010: 3%) - weakened 8% (2010: 3%)
(22) 22
9 (9)
(24) 24
86

30 June 2011 29. Fair value of financial instruments
(a) Fair value of financial instruments that are carried at fair value Fair value hierarchy The Group classifies fair value measurement using a fair value hierarchy that reflects the significance of the inputs used in making the measurements. The fair value hierarchy has the following levels: Level 1 Quoted prices (unadjusted) in active markets for identical assets or liabilities Level 2 Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e., as prices) or indirectly (i.e., derived from prices), and Level 3 Inputs for the asset or liability that are not based on observable market data (unobservable inputs) The Group has not classified any financial instrument under Level 1 and Level 2. (b) Fair value of financial instruments by classes that are not carried at fair value and whose carrying amounts are reasonable approximation of fair value Current trade and other receivables (Note 7), due from subsidiaries/related parties (Note 8), trade and other payables (Note 10), accrued expenses (Note 13), due to directors/related parties (Note 8), loan from directors (Note 8), obligations under finance leases (Note 12) and bills payable to bank (Note 11). The carrying amounts of these financial assets and liabilities are reasonable approximation of fair values, either due to their short-term nature or that they are floating rate instruments that are re-priced to market interest rates on or near the balance sheet date. (c) 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 Total carrying amount 2011 2010 $ $ Group Finance lease obligations repayable after 1 year but within 5 years Determination of fair value The fair value has been determined using discounted estimated cash flows. The discount rates used are the current market incremental lending rates for similar types of leasing arrangements at the balance sheet date. 168,393 104,815 157,327 94,074 Aggregate fair value 2011 2010 $ $
Annual Report 2011
87

30 June 2011 30. Capital management
The primary objective of the Groups capital management is to ensure that it maintains adequate funds to support its business activities and to continue as a going concern. 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 issue new shares. No changes were made in the objectives, policies or processes during the years ended 30 June 2011 and 30 June 2010. The Group monitors capital using a gearing ratio, which is net debt divided by total capital plus net debt. Group 2011 $ Trade and other payables (Note 10) Accrued expenses (Note 13) Loan from directors (Note 8) Provision (Note 14) Due to related parties (Note 8) Bills payable to bank (Note 11) Obligations under finance leases (Note 12) Loan from related party (non-current) (Note 8) Less: Cash and bank balances (Note 9) Net debt Equity attributable to the equity holders of the parent Capital and net debt Gearing ratio 1,777,647 920,001 784,828 455,833 241,277 300,000 (698,840) 3,780,746 1,196,901 4,977,647 76% 2010 $ 2,228,286 1,913,654 400,472 51,797 161,706 916,353 234,239 (1,427,085) 4,479,422 1,996,980 6,476,402 69%
31.
Segment information
For management purposes, the Group is organised into business units based on their product and services, and has five reportable operating segments as follows: Tray recycling Tray recycling segment provides services of recycling and precision cleaning of packaging trays and media/ disk cassettes used in the hard disk drive and semiconductor industries. This segment also includes precision parts cleaning and parts visual inspection as well as clean room laundry cleaning services. Manufacturing Manufacturing segment refers to manufacturing of clean room grade packaging products such as LDPE/ HDPE bags, ESD bags and aluminum moisture barrier bags for the electronics and hard disk drive industries. Corporate The corporate segment is involved in Group-level corporate services.
88

30 June 2011 31. Segment information (contd)
Natural Gas Vehicle (NGV) related business NGV related business segment refers to the trading of NGV related products such as bi-fuel conversion kits and cylinders and provision of vehicle conversion services. For vehicle conversion services, the segment provides services for the conversion of petrol vehicles to run on Bi-Fuel system where natural gas can be used to replace petrol and services for the conversion of heavy duty diesel vehicles using Dual Diesel Fuel (DDF) system to cut down the usage of diesel for diesel vehicles. 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 on an arms length basis in a manner similar to transactions with third parties. Geographical information The Groups geographical information are based on the location of the Groups assets. Sales to external customers disclosed in geographical segments are based on the geographical location of its customers. Information about major customers Revenues from one major customer in the tray recycling segment amounted to $1,235,886 (2010: $1,924,730). Revenues from one major customer in the NGV related business segment amounted to $2,140,487 (2010: $10,446,262).
Annual Report 2011
89
90
30 June 2011
Manufacturing 2011 2010 $ $ Plastic waste recycling 2011 2010 $ $ Elimination 2011 2010 $ $ Natural Gas Vehicle (NGV) related business 2011 2010 $ $ Corporate and others 2011 2010 $ $ Consolidated 2011 2010 $ $ 2,014 251 2,265 (28) 587 27 (1,528) (1,253) (1,772) (1,050) 2,712 183 635 2,895 12,721 1,650 1,596 288 49 (1,901) 330 (1,933) 178 8,575 (4,576) (67) 3 20,704 (2,911) (126) 4 2,424 183 586 2,895 12,721 1,650 1,596 (1,901) (1,933) 8,575 20,704
31.
Segment information (contd)
Segments
Asian Micro Holdings Limited (4,640) 211 (4,429) 22 (3,011) (71) (3,082)
The following table presents revenue and results information regarding the Groups reportable operating segments for the financial years ended 30 June 2011 and 2010 (in $000).
Tray recycling 2011 2010 $ $
Segment revenue Sales to external customers Inter-segment sales
3,483
4,973
Total revenue
3,483
4,973
Segment results Financial expenses Financial income Share of results of associated companies
(1,605)
(1,373)
Loss before taxation Tax expense
Loss for the year
31.
Segment information (contd)
Segments (contd)
Tray recycling 2011 2010 $ $ 1,389 1,452 1,005 4,449 7,577 2,563 2,336 (9,453) (15,819) 5,275 5,275 2,187 1,750 628 10,392 11,361 4,130 2,990 (34,063) (35,728) 3,499 998 4,497 98 29 16 51 220 172 5 70 462 842 1 38 (47) (173) (26) 537 500 8,319 8,319 4,756 1,397 6,153 1,103 695
Manufacturing 2011 2010 $ $
Plastic waste recycling 2011 2010 $ $ Elimination 2011 2010 $ $ Consolidated 2011 2010 $ $
Natural Gas Vehicle (NGV) related business 2011 2010 $ $ Corporate and others 2011 2010 $ $
Segment assets
6,327
11,768
Total assets
Segment liabilities 20,853 Unallocated liabilities
23,755
Total liabilities
23
326
Capital expenditure Depreciation Impairment losses of property, plant and equipment 166 52
246
482
528
(52)
166
528
The following table presents revenue and assets information based on the geographical location of customers and assets, respectively, for the years ended 30 June 2011 and 2010 (in $000). Malaysia 2010 2009 $ $ Thailand 2011 2010 $ $ PRC 2011 $ 2010 $ Others 2011 2010 $ $ Total 2011 $ 2010 $
Singapore 2011 2010 $ $
Sales to external customer 1 3
7,100
6,059
1,118 1,673
13,580 3,029
357 10
1,065 2,133
8,575 5,275
20,704 8,319
Annual Report 2011
30 June 2011
Assets
3,591
3,154
91

30 June 2011 32. Comparatives
The following comparative figures in the statement of comprehensive income have been reclassified to allow a more appropriate presentation and better reflect the nature of the transactions. Details of comparative figures reclassified in the statement of comprehensive income for the year ended 30 June 2010 are as follows: Group As As previously reclassified classified $ $ Revenue Other operating income Other operating expenses 20,703,625 836,761 (1,258,463) 20,608,586 896,506 (1,233,169)
33.
Events occurring after the reporting period

On 4 July 2011, the Company granted 5,400,000 share options, with an exercise price of S$0.01 for each option, pursuant to the Asian Micro Employees Share Option Scheme 2010 (the ESOS 2010) to employees of the Group. 3,000,000 of the share options were granted to the directors of the Company.
34.
Authorisation of financial statements

The financial statements for the year ended 30 June 2011 were authorised for issue in accordance with a resolution of the directors on 7 October 2011.
92
STATISTICS OF SHAREHOLDINGS
As at 16 September 2011
NO. OF SHARES ISSUED CLASS OF SHARES VOTING RIGHTS : : : 463,591,043 ORDINARY SHARES 1 VOTE PER SHARE
The Company does not hold any treasury shares. NO. OF SHAREHOLDERS 4 2,686 1,311 29 4,030
SIZE OF SHAREHOLDINGS 1 999 1,000 10,000 10,001 1,000,000 1,000,001 & ABOVE TOTAL
% 0.10 66.65 32.53 0.72 100.00
NO. OF SHARES 1,222 10,038,000 114,838,300 338,713,521 463,591,043
% 0.00 2.17 24.77 73.06 100.00
TOP TWENTY SHAREHOLDERS AS AT 16 SEPTEMBER 2011

NAME OF SHAREHOLDERS LIM KEE LIEW @ VICTOR LIM LEONG LAI HENG LIN XIANGLONG WINCHESTER LEE DEH KHUAN KELVIN CHNG BOON KIAN LIN MEIJUAN SOPHIA AMERICAN CONVERTERS INDUSTRIES PTE LTD UNITED OVERSEAS BANK NOMINEES (PTE) LTD DBS NOMINEES PTE LTD TAN CHENG SOI FOO MEI YIEN JOANNE CHAN SZE MING DBS VICKERS SECURITIES (S) PTE LTD ZHANG JILEI CHOO CHEE KIONG TAY KIM CHAI JOHNSON CHERN SIANG SIN @ CHENG SIANG SIN PIYAWAT JIRAWATOPHAT LIM KEE HING WANG KAI YUEN NO. OF SHARES 138,741,217 118,646,760 11,550,000 9,883,000 7,840,000 7,756,000 3,866,439 3,351,000 3,305,000 2,674,000 2,650,000 2,487,000 2,481,000 2,142,000 2,000,000 2,000,000 1,688,000 1,664,000 1,595,000 1,526,000 327,846,416 % 29.93 25.59 2.49 2.13 1.69 1.67 0.83 0.72 0.71 0.58 0.57 0.54 0.54 0.46 0.43 0.43 0.36 0.36 0.35 0.33 70.71
36.38% of the Companys shares are held in the hands of public. Accordingly, the Company has complied with Rule 723 of the Listing Manual, Section B: Rules of Catalist.
Annual Report 2011
93
SHAREHOLDERS INFORMATION
As at 16 September 2011 SUBSTANTIAL SHAREHOLDERS (As recorded in the Register of Substantial Shareholders)
NAME OF SHAREHOLDER LIM KEE LIEW @ VICTOR LIM LEONG LAI HENG (a) (b) DIRECT INTEREST 138,741,217 118,646,760 29.93% 25.59% DEEMED INTEREST 125,218,304 145,312,761 27.01% 31.35%
Notes: (a) Mr. Lim Kee Liew @ Victor Lim's deemed interest arose through 496,000 shares held by DBS Nominees (Private) Limited, 1,449,105 shares held by Ultraline Technology (S) Pte Ltd and 3,866,439 shares held by American Converters Industries Pte Ltd. He is also deemed to have an interest in the 119,406,760 shares held by his spouse, Ms. Leong Lai Heng. Ms. Leong Lai Heng's deemed interest arose through 760,000 shares held by United Overseas Bank Nominees (Private) Limited, 1,449,105 shares held by Ultraline Technology (S) Pte Ltd and 3,866,439 shares held by American Converters Industries Pte Ltd. She is also deemed to have an interest in the 139,237,217 shares held by her spouse, Mr. Lim Kee Liew @ Victor Lim. * Mr. Lim Kee Liew @ Victor Lim and Ms. Leong Lai Heng each own 50% of the entire issued and paid-up share capital of Ultraline Technology (S) Pte Ltd and American Converters Industries Pte Ltd.
(b)
94
NOTICE OF ANNUAL GENERAL MEETING

NOTICE IS HEREBY GIVEN that the Annual General Meeting of Asian Micro Holdings Limited (the Company) will be held at Raffles Marina, 10 Tuas West Drive, Singapore 638404 on Friday, 28 October 2011 at 10.00 a.m. for the following purposes: AS ORDINARY BUSINESS 1. To receive and adopt the Directors Report and the Audited Accounts of the Company for the year ended 30 June 2011 together with the Auditors Report thereon. (Resolution 1) To re-elect the following Directors of the Company retiring pursuant to Articles 88 and 89 of the Articles of Association of the Company: (a) (b) (c) (d) Mr. Mr. Mr. Mr. Ng Chee Wee (Retiring under Article 88) Chue Wai Tat (Retiring under Article 88) Lin Xianglong Winchester (Retiring under Article 88) Teo Kio Choon @ Chang Chiaw Choon (Retiring under Article 89) (Resolution (Resolution (Resolution (Resolution 2) 3) 4) 5)
2.
Mr. Ng and Mr. Lin are Executive Directors of the Company. Mr. Chue will, upon re-election as a Director of the Company, remain as a member of the Audit Committee, Nominating Committee and Remuneration Committee and will be considered independent. Mr. Teo will, upon re-election as a Director of the Company, remain as Chairman of Nominating Committee and a member of the Audit Committee and Remuneration Committee and will be considered independent. 3. To approve the payment of Directors fees of S$50,663.23 for the year ended 30 June 2011. (2010: S$51,840). (Resolution 6) To re-appoint Messrs Ernst & Young LLP as the Auditors of the Company and to authorise the Directors of the Company to fix their remuneration. (Resolution 7) To transact any other ordinary business which may properly be transacted at an Annual General Meeting.
4.
5.
AS SPECIAL BUSINESS To consider and if thought fit, to pass the following resolutions as Ordinary Resolutions, with or without any modifications: 6. Authority to issue shares That pursuant to Section 161 of the Companies Act, Cap. 50 and Rule 806 of Section B of the Singapore Exchange Securities Trading Limited Listing Manual: Rules of Catalist (the Catalist Rules), the Directors of the Company be authorised and empowered to: (a) (i) (ii) issue shares in the Company (shares) whether by way of rights, bonus or otherwise; and/or make or grant offers, agreements or options (collectively, Instruments) that might or would require shares to be issued, including but not limited to the creation and issue of (as well as adjustments to) options, warrants, debentures or other instruments convertible into shares,
at any time and upon such terms and conditions and for such purposes and to such persons as the Directors of the Company may in their absolute discretion deem fit; and (b) (notwithstanding the authority conferred by this Resolution may have ceased to be in force) issue shares in pursuance of any Instruments made or granted by the Directors of the Company while this Resolution was in force, Annual Report 2011
95

provided that: (1) the aggregate number of shares (including shares to be issued in pursuance of the Instruments, made or granted pursuant to this Resolution) to be issued pursuant to this Resolution shall not exceed one hundred per centum (100%) of the total number of issued shares in the capital of the Company (as calculated in accordance with sub-paragraph (2) below), of which the aggregate number of shares to be issued other than on a pro rata basis to shareholders of the Company shall not exceed fifty per centum (50%) of the total number of issued shares in the capital of the Company (as calculated in accordance with sub-paragraph (2) below); (subject to such calculation as may be prescribed by the Singapore Exchange Securities Trading Limited) for the purpose of determining the aggregate number of shares that may be issued under sub-paragraph (1) above, the total number of issued shares shall be based on the total number of issued shares in the capital of the Company at the time of the passing of this Resolution, after adjusting for: (a) (b) new shares arising from the conversion or exercise of any convertible securities; new shares arising from exercising share options or vesting of share awards which are outstanding or subsisting at the time of the passing of this Resolution; and any subsequent consolidation or subdivision of shares;
(2)
(c) (3)
in exercising the authority conferred by this Resolution, the Company shall comply with the provisions of the Catalist Rules for the time being in force (unless such compliance has been waived by the Singapore Exchange Securities Trading Limited) and the Articles of Association of the Company; and unless revoked or varied by the Company in a general meeting, such authority shall continue in force until the conclusion of the next Annual General Meeting of the Company or the date by which the next Annual General Meeting of the Company is required by law to be held, whichever is earlier. [See Explanatory Note (i)] (Resolution 8)
(4)
7.
Authority to issue shares under the Asian Micro Employees Share Option Scheme 2010 That pursuant to Section 161 of the Companies Act, Cap. 50, the Directors of the Company be authorised and empowered to offer and grant options under the Asian Micro Employees Share Option Scheme (the Scheme) and to issue from time to time such number of shares in the capital of the Company as may be required to be issued pursuant to the exercise of options granted by the Company under the Scheme, whether granted during the subsistence of this authority or otherwise, provided always that the aggregate number of additional ordinary shares to be issued pursuant to the Scheme shall not exceed twenty five per centum (25%) of the total number of issued shares in the capital of the Company from time to time and that such authority shall, unless revoked or varied by the Company in a general meeting, continue in force until the conclusion of the next Annual General Meeting of the Company or the date by which the next Annual General Meeting of the Company is required by law to be held, whichever is earlier. [See Explanatory Note (ii)] (Resolution 9)
By Order of the Board
Lee Ellen Secretary Singapore, 13 October 2011
96

Explanatory Notes: (i) The Ordinary Resolution 8 in item 6 above, if passed, will empower the Directors of the Company, effective until the conclusion of the next Annual General Meeting of the Company, or the date by which the next Annual General Meeting of the Company is required by law to be held or such authority is varied or revoked by the Company in a general meeting, whichever is the earlier, to issue shares, make or grant Instruments convertible into shares and to issue shares pursuant to such Instruments, up to a number not exceeding, in total, 100% of the total number of issued shares in the capital of the Company, of which up to 50% may be issued other than on a pro-rata basis to shareholders. The Ordinary Resolution 9 in item 7 above, if passed, will empower the Directors of the Company, effective until the conclusion of the next Annual General Meeting of the Company, or the date by which the next Annual General Meeting of the Company is required by law to be held or such authority is varied or revoked by the Company in a general meeting, whichever is the earlier, to issue shares in the Company pursuant to the exercise of options granted or to be granted under the Scheme up to a number not exceeding in aggregate (for the entire duration of the Scheme) twenty five per centum (25%) of the total number of issued shares in the capital of the Company from time to time.
(ii)
Notes: 1. A member entitled to attend and vote at the Annual General Meeting (the Meeting) is entitled to appoint not more than two proxies to attend and vote in his/her stead. A proxy need not be a Member of the Company. The instrument appointing a proxy must be deposited at the registered office of the Company at 1 Tech Park Crescent, Singapore 638131 not less than 48 hours before the time appointed for holding the Meeting.
2.
Annual Report 2011
97
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(Company Registration No.199701052K) (Incorporated In The Republic of Singapore with limited liability)
IMPORTANT: 1. For investors who have used their CPF monies to buy Asian Micro Holdings Limiteds shares, this Report is forwarded to them at the request of the CPF Approved Nominees and is sent solely FOR INFORMATION ONLY. 2. This Proxy Form is not valid for use by CPF investors and shall be ineffective for all intents and purposes if used or purported to be used by them. CPF investors who wish to attend the Meeting as an observer must submit their requests through their CPF Approved Nominees within the time frame specified. If they also wish to vote, they must submit their voting instructions to the CPF Approved Nominees within the time frame specified to enable them to vote on their behalf.
PROXY FORM
(Please see notes overleaf before completing this Form)
3.
I/We, of being a member/members of Asian Micro Holdings Limited, hereby appoint: Name NRIC/Passport No. Proportion of Shareholdings No. of Shares Address %
and/or (delete as appropriate) Name NRIC/Passport No. Proportion of Shareholdings No. of Shares Address %
or failing the person, or either or both of the persons, referred to above, the Chairman of the Meeting as my/our proxy/ proxies to vote for me/us on my/our behalf at the Annual General Meeting (the Meeting) of the Company to be held on 28 October 2011 at 10.00 a.m. and at any adjournment thereof. I/We direct my/our proxy/proxies to vote for or against the Resolutions proposed at the Meeting as indicated hereunder. If no specific direction as to voting is given or in the event of any other matter arising at the Meeting and at any adjournment thereof, the proxy/proxies will vote or abstain from voting at his/her discretion. The authority herein includes the right to demand or to join in demanding a poll and to vote on a poll. (Please indicate your vote For or Against with a tick [] within the box provided.) No. 1 2 3 4 5 6 7 8 9 Resolutions relating to: Directors Report and Audited Accounts for the year ended 30 June 2011 Re-election of Mr. Ng Chee Wee as a Director Re-election of Mr. Chue Wai Tat as a Director Re-election of Mr. Lin Xianglong Winchester as a Director Re-election of Mr. Teo Kio Choon @ Chang Chiaw Choon as a Director Approval of Directors fees amounting to S$50,663.23 Re-appointment of Messrs Ernst & Young LLP as Auditors Authority to issue new shares Authority to issue shares under the Asian Micro Employees Share Option Scheme 2010 day of 2011 Total number of Shares in: (a) CDP Register (b) Register of Members Signature of Shareholder(s) or, Common Seal of Corporate Shareholder No. of Shares For Against
Dated this
Notes: 1. Please insert the total number of Shares held by you. If you have Shares entered against your name in the Depository Register (as defined in Section 130A of the Companies Act, Chapter 50 of Singapore), you should insert that number of Shares. If you have Shares registered in your name in the Register of Members, you should insert that number of Shares. If you have Shares entered against your name in the Depository Register and Shares registered in your name in the Register of Members, you should insert the aggregate number of Shares entered against your name in the Depository Register and registered in your name in the Register of Members. If no number is inserted, the instrument appointing a proxy or proxies shall be deemed to relate to all the Shares held by you. A member of the Company entitled to attend and vote at a meeting of the Company is entitled to appoint one or two proxies to attend and vote in his/her stead. A proxy need not be a member of the Company. Where a member appoints two proxies, the appointments shall be invalid unless he/she specifies the proportion of his/her shareholding (expressed as a percentage of the whole) to be represented by each proxy. Completion and return of this instrument appointing a proxy shall not preclude a member from attending and voting at the Meeting. Any appointment of a proxy or proxies shall be deemed to be revoked if a member attends the meeting in person, and in such event, the Company reserves the right to refuse to admit any person or persons appointed under the instrument of proxy to the Meeting. The instrument appointing a proxy or proxies must be deposited at the registered office of the Company at 1 Tech Park Crescent, Singapore 638131 not less than 48 hours before the time appointed for the Meeting. The instrument appointing a proxy or proxies must be under the hand of the appointor or of his attorney duly authorised in writing. Where the instrument appointing a proxy or proxies is executed by a corporation, it must be executed either under its seal or under the hand of an officer or attorney duly authorised. Where the instrument appointing a proxy or proxies is executed by an attorney on behalf of the appointor, the letter or power of attorney or a duly certified copy thereof must be lodged with the instrument. A corporation which is a member may authorise by resolution of its directors or other governing body such person as it thinks fit to act as its representative at the Meeting, in accordance with Section 179 of the Companies Act, Chapter 50 of Singapore.
2.
3.
4.
5.
6.
7.
General: The Company shall be entitled to reject the instrument appointing a proxy or proxies if it is incomplete, improperly completed or illegible, or where the true intentions of the appointor are not ascertainable from the instructions of the appointor specified in the instrument appointing a proxy or proxies. In addition, in the case of Shares entered in the Depository Register, the Company may reject any instrument appointing a proxy or proxies lodged if the member, being the appointor, is not shown to have Shares entered against his name in the Depository Register as at 48 hours before the time appointed for holding the Meeting, as certified by The Central Depository (Pte) Limited to the Company.

No. 1, Tech Park Crescent, Tuas Tech Park, Singapore 638131 Tel: 65 6862 7777 Fax: 65 6862 6277 Company Registration No. 199701052K www.asianmicro.com.sg
Supplying CNG to: Manufacturing Industries Shipyard Industries Oil & Gas Industries Power Generation Test Grids

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ASIAN MICRO HOLDINGS LIMITED

Growing Our Green Potential

Teo Kio Choon @ Chang Chiaw Choon Chue Wai Tat

registered aNd BusiNess office

Malayan Banking Berhad United Overseas Bank Limited

Teo Kio Choon @ Chang Chiaw Choon Chue Wai Tat

B.A.C.S. Private Limited 63 Cantonment Road Singapore 089758

Annual Report 2011

2 Asian Micro Holdings Limited

Annual Report 2011

4 Asian Micro Holdings Limited

dr. Wang kai yuen Chairman 30 September 2011

Annual Report 2011

6 Asian Micro Holdings Limited

Winchester Lin is the son of the CEO and Group

Annual Report 2011

8 Asian Micro Holdings Limited

Annual Report 2011

turnover by region (S$000)

Net profit (Loss) attriButaBLe to sharehoLders (S$000)

turnover by business activities (S$000)

Plastic waste recycling NGV related

NGV related 2,895

Tray recycling 3,483

Plastic waste recycling 183

10 Asian Micro Holdings Limited

REPORT ON CORPORATE GOVERNANCE

(b) (c) (d) (e)

Annual Report 2011

REPORT ON CORPORATE GOVERNANCE

(Appointed on 6 July 2011)

Name of Director Mr. Lim Kee Liew @ Victor Lim

Mr. Lin Xianglong Winchester

Mr. Ng Chee Wee

Dr. Wang Kai Yuen

Mr. Teo Kio Choon @ Chang Chiaw Choon

Mr. Chue Wai Tat

Asian Micro Holdings Limited

REPORT ON CORPORATE GOVERNANCE

The NC has adopted written terms of reference.

Annual Report 2011

REPORT ON CORPORATE GOVERNANCE

resigned on 24 August 2011 resigned on 1 June 2011 resigned on 25 May 2011

Asian Micro Holdings Limited

REPORT ON CORPORATE GOVERNANCE

Annual Report 2011

REPORT ON CORPORATE GOVERNANCE

Remuneration band and name of directors

100 100 100

100 100 100 100 100

Below S$250,000 : Lin Xianglong, Winchester* Han Yee Yen

100 100 100 100 100 100 100 100 100

Lim Kee Hing Lim See Wai Vincent Koh

Ng Chee Wee Ng Cher Lek Yang Lei

Ang Chee Hao

Asian Micro Holdings Limited

REPORT ON CORPORATE GOVERNANCE

REPORT ON CORPORATE GOVERNANCE

COMMUNICATION WITH SHAREHOLDERS

Asian Micro Holdings Limited

REPORT ON CORPORATE GOVERNANCE

INTERESTED PERSON TRANSACTIONS

NON-AUDIT FEES AND NON-SPONSOR FEES

Annual Report 2011