18AUGʼ08 11.30pm GOLD CYAN MAGENTA YELLOW BLACK … · penjualan hartanah dan syarikat dan...

GOLD BLACKYELLOWMAGENTACYANIreka 2008 Cover_X5.ai18AUGʼ08 11.30pm

O2A47356AUG08 Job No. Operator. Vincent G5-34

BLACKYELLOWMAGENTACYANIreka 2008 inside Cover_X518AUGʼ08 11.30pm


Contents

Chairman’s Statement 2 Penyata Pengerusi 4

Operations Review 7 Five - Year Financial Highlights 14

Corporate Structure 15 Corporate Information 17

Board of Directors 18 Profile of Company Secretary and Senior Management 22

Corporate Calendar 27 Corporate Social Responsibility Statement 28

Corporate Governance Statement 29 Internal Control Statement 33

Audit Committee Report 34 Financial Statements 37

Statistics of Shareholdings 117 List of Material Properties 119

Notice of Annual General Meeting 120 Statement Accompanying Notice 121

Proxy Form

Vision Statement

To be a progressive and globally focused corporation, which prides itself on proven track record in performance, reliability, excellence in quality and creativity in all services and products that we offer.

…in trusted hands

2

On behalf of the Board of Directors,

I am pleased to present the Annual

Report and Financial Statements of

Ireka Corporation Berhad (“the

Group”) for the financial year ended

31 March 2008.

Haji Abdullah Bin Yusof

Chairman

3

Chairman’s Statement

For the financial year ended 31 March 2008, theGroup recorded an improved revenue ofRM299.726 million compared to RM186.541 millionrecorded in 2007 which reflected the increasedconstruction activities carried out during the yearunder review. However continued increase in thecost of construction materials and energy had putpressure on results from the construction sector.After taking into account losses from completedconstruction projects and gain on the disposal ofthe Group’s property development subsidiaries,the net profit for the year was RM152.863 millioncompared to a loss of RM33.283 million recorded inthe previous year.

An interim dividend of 10% per share less 27%income tax totaling RM8.316 million was paid toshareholders on 9 October 2007. The Directorshave recommended that a final dividend of 10%

per share less income tax of 26% amounting toRM8.430 million in respect of the financial yearended 31 March 2008 which is subject to theapproval of shareholders at the forthcomingAnnual General Meeting of the Company. I fapproved, the total net dividend paid for thisfinancial year will amount to RM16.746 million,which is equivalent to a net dividend payout 14.70sen per share.

In May 2008, the Company has announced adividend policy to distribute 40% of its netearnings to shareholders with effect from financialyear 2009. The Company will maintain the paymentin the future subject to a number of factors whichinclude availability of distributable reserves andthe Company’s future cash flow requirements. Theproposed dividend payment for each financial yearwill generally be paid in two tranches comprisingan interim and a final dividend.

In my Statement last year, I reported that theGroup will be adopting a new business strategygoing forward through the sale of its certainproperty assets/companies and the subsequentlisting of Aseana Properties Limited on The LondonStock Exchange, Main Market. This exercise hasnow been successfully implemented and IrekaDevelopment Management Sdn Bhd as propertydevelopment manager of the London listed entityis now fully active both in Malaysia and Vietnam.

On the construction front, the Group expectsturnover to increase based on the value of works inhand. The Group has in June 2008 secured aconstruction contract worth RM539.800 million toconstruct the SENI Mont’ Kiara Condominium inMont’ Kiara.

The Information Technology business under i-TechNetwork Solutions Sdn Bhd continues to grow withsales increase by 31% to RM11.910 million for thefinancial year ended 31 March 2008 although profitmargins have suffered due to the competitive andtough business environment.

In an effort to expand the Group’s activities inVietnam, Ireka Venture Capital Ltd has entered intoa share subscription agreement with KinhBac City Development Shareholding Corporation, a company listed on the Hanoi Stock Exchange. The share acquisition is a strategic investment thatwill provide the Group with a platform to ventureinto the infrastructure development andconstruction markets in Vietnam.

I believe that the Group is on a firm financialfooting to withstand the current unfavorableeconomic condition in Malaysia and globally.Therefore, I am confident that the businesses of the Group will continue to contribute positively tothe Group’s earnings for the coming year.

On behalf of the Board of Directors it gives megreat pleasure to thank you, shareholders,customers and business associates and therelevant authorities for your support. I would alsolike to thank our employees at all levels for theircontributions, commitment and hard work infacing the challenges ahead. Finally, I would like tothank my fellow Board members for theircontribution and guidance during the year.

Haji Abdullah Bin YusofChairman18 August 2008

one Mont’ Kiara

Bagi pihak Lembaga Pengarah, saya dengansukacitanya membentangkan Laporan Tahunandan Penyata Kewangan bagi Ireka CorporationBerhad (“Kumpulan”) bagi tahun kewangan yangberakhir pada 31 Mac 2008.

Perolehan Kumpulan telah meningkat dariRM186.541 juta pada tahun 2007 kepadaRM299.726 juta pada tahun kewangan 2008 yangberakhir pada 31 Mac 2008, iaitu sejajar denganpeningkatan jumlah aktiviti-aktiviti pembinaanyang dilaksanakan sepanjang tahun tinjauan.Walaubagaimanapun, prestasi bagi sectorpembinaan dicabar oleh lonjakan harga yangberterusan untuk tenaga and kos bahan binaan.Setelah mempertimbangkan jumlah kerugianuntuk projek-projek pembinaan yang telah selesai

dilaksanakan dan juga keuntungan dari penjualansyarikat pembangunan hartanah bagi Kumpulan,Kumpulan mencapai keuntungan bersih sebanyakRM152.863 juta pada tahun 2008 berbandingdengan jumlah kerugian sebanyak RM33.283 jutapada tahun 2007.

Dividen interim sebanyak 10% ditolak cukaipendapatan 27% sesaham yang berjumlahRM8.316 juta telah dibayar kepada pemegangsaham pada 9 Oktober 2007. Lembaga Pengarahtelah mencadangkan dividen kasar akhir sebanyak10% ditolak cukai pendapatan 26% yangberjumlah RM8.430 juta bagi tahun kewanganyang berakhir pada 31 Mac 2008. Cadangandividen ini memerlukan kelulusan daripada parapemegang saham di Mesyuarat Agung Tahunan

Kumpulan yang akan datang. Jikalau cadangandiluluskan, jumlah dividen bersih yang akandibayar untuk tahun kewangan 2008 akanberjumlah RM16.746 juta, iaitu persamaan dengandividen bersih sebanyak 14.70 sen sesaham.

Selain itu, Kumpulan telah mengumumkan polisidividennya pada bulan May 2008 untuk membayar40% daripada jumlah pendapatan bersih yangdiperolehi berkuatkuasa pada tahun kewangan2009. Polisi ini akan dikekalkan untuk tahun-tahunyang akan datang dan tertakluk kepadaperuntukan dana edaran simpanan dan alirantunai Kumpulan pada tahun-tahun yang akandatang.

Penyata Pengerusi

4

Skypool, Tiffani by i-ZEN

5

Pembayaran dividen yang dicadangkan untuksetiap tahun kewangan pada umumnya akandibahagikan kepada 2 agihan, iaitu dividen interimdan dividen akhir.

Pada laporan kewangan 2007, saya telahmelaporkan bahawa Kumpulan akanmelaksanakan strategi bisnes baru untuk terusmara di sektor pembangunan hartanah melaluipenjualan hartanah dan syarikat dan berikutnyadengan penyenaraian Aseana Properties Limited diPasaran Utama, London Stock Exchange. Misi initelah berjaya dilaksanakan di mana IrekaDevelopment Management Sdn Bhd, selakupengurus pembangunan hartanah untuk entitiyang disenaraikan di London Stock Exchangesedang beroperasi dengan aktif di Malaysia andVietnam.

Kumpulan menjangka asas pendapatan dari sektorpembinaan akan meningkat, iaitu selaras denganpeningkatan dari nilai projek-projek pembinaanyang sedang dilaksanakan oleh Kumpulan. PadaJun 2008, Kumpulan telah berjaya mendapatkankontrak pembinaan yang bernilai RM539.800 jutauntuk membina SENI Mont’ Kiara Kondominium diMont’ Kiara.

Bisnes teknologi and informasi Kumpulan di bawahnaungan I-Tech Network Solutions Sdn Bhd terusberkembang dengan merekodkan peningkatanpenjualan sebanyak 31% kepada RM11.910 jutauntuk tahun kewangan yang berakhir pada 31 Mac2008, walaupun keuntungannya merosotdisebabkan oleh persaingan bisnes yang hebatdan sukar yang wujud di bidang ini.

Syarikat subsidiari yang dimiliki sepenuhnya olehKumpulan, iaitu Ireka Venture Capital Ltd telahmenangani kontrak pembelian saham KinhBac CityDevelopment Shareholding Corporation yangdisenaraikan di Hanoi Stock Exchange sebagaiinisiatif untuk pemperluaskan perniagaanKumpulan di Vietnam. Pemilikan saham inimerupakan pelaburan strategik Kumpulan denganmenyediakan pelantaran kepada Kumpulan untukmenerajui pembangunan infrastruktur dan jugapasaran pembinaan di Vietnam.

Saya berasa yakin bahawa keadaan kewanganKumpulan yang teguh akan berjaya mengatasikeadaan ekonomi Malaysia dan juga dunia yangtidak menguntungkan. Dengan itu, saya berasayakin bahawa bisnes untuk Kumpulan akan terusmencapai pertumbuhan pendapatan yang positifpada tahun depan.

Bagi pihak Lembaga Pengarah, saya inginmengucapkan terima kasih kepada pemegangsaham, para pelanggan, sekutu niaga dan jugapelbagai pihak berkuasa di atas sokongan sekalianterhadap Kumpulan.

Saya juga ingin merakamkan penghargaan kepadapara pekerja dari semua peringkat di atassumbangan, usaha dan komitmen untukmenghadapi cabaran yang akan datang. Akhirnya,saya ingin menyampaikan penghargaan sayakepada ahli-ahli Lembaga Pengarah di atassumbangan dan panduan sepanjang tahun ini.

Haji Abdullah Bin YusofPengerusi18 Ogos 2008

Penyata Pengerusi

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Operations Review

6

Tiffani by i-ZEN and SENI are just two of Ireka’s stunningsignature concepts of homes designed for the morediscriminating and demanding Malaysian homeowner.

Interior of SENI@Mont’ Kiara

7

A stronger financial standing ensures that the Group is in a position to capitalise on opportunitiesthrough the ups and downs of business cycles. This is particularly pertinent for the construction andproperty development businesses that have always been characterised by its cyclical nature andlong gestation periods. An early testament of our strong business model is our ability to build onthe order book for construction in this challenging year, which has increased to approximatelyRM948 million. At the same time, our property development business, through Aseana Properties,has secured seven landmark deals in Malaysia and Vietnam.

For FY2008, the Group has registered a Gross Operating Profit of RM164.170 million, compared to aGross Operating Loss of RM22.002 million in the previous year. The strong operating profits aremainly a result of the exceptional gains recorded from the disposal of Ireka Land Sdn Bhd, and ICSDVentures Sdn Bhd to Aseana Properties during the financial year under review. This turnaround inearnings is also on the back of an approximately 61% increase in revenues from the earlier year toRM299.726 million in FY2008.

Financial Year 2008 (“FY2008”) started on a high note for the Ireka Group (“the Group”) with thelisting of Aseana Properties Limited (“Aseana Properties”) on the Main Market of the London StockExchange on 5 April 2007. FY2008, hence, marks the completion of the first year of operations forthe Group under the Group’s new strategic plan for the next decade.

In FY2008, led by the construction and property development business, the Group has witnessedstrong growth. Aseana Properties has made further inroads in the property development businessin Malaysia and Vietnam, which we believe will solidify and sustain the Group’s earnings pipeline inthe medium to long term.

The recent, unprecedented global credit crisis and inflation fears, which have sparked recessionaryconcerns all across Asia and rest of the world, will place the Group’s business under a stern test inthe coming years. In this light, the restructuring conducted by the Group over the past 2 years hasproven to be timely as we believe that the Group has improved its resilience to withstand theseeconomic uncertainties.

Operations Review

Tiffani by i-ZEN, Mont’ Kiara

i-ZEN@Kiara I, Mont’ Kiara

We are confident that the combination of profitable constructionprojects and stable earnings from property developmentmanagement will see the Group through the challenging times inthe economy this year. Looking at a further horizon, the Group hasinvested for the long term in Malaysia and the growing economy ofVietnam. We are confident that these two countries with its strongfundamentals will bode well for the construction, propertydevelopment and information technology industries in the mediumto long term.

Construction Business

During the financial year under review, the construction industry inMalaysia grew at 4.6%. The positive growth of the industry in the pasttwo years was underpinned by activities in the civil engineering,residential and commercial property sub-sectors. However, theoutlook for the construction industry remains challenging in the nearto medium term as a result of global increase in prices of steel,cement and other key construction materials.

8

one Mont’ Kiara

Wall Street Centre, Ho Chi Minh City

Operations Review

In these difficult operating conditions, IrekaEngineering & Construction Sdn Bhd (“IECSB”) hascontinued to strive in improving efficiency on site,adopting a prudent management of cash-flow andwhere feasible, adopting value engineeringtechniques to improve construction efficiency andproductivity. IECSB is also actively studying variousstrategies to improve procurement andmanagement of key construction materials. Withthis proactive management approach, we areconfident that the Group’s construction projectswill deliver positive results.

For the calendar year to date, we are proud to havedelivered two completed projects to our clients.IECSB is fast building on its expertise andexperience in constructing high-end residentialdevelopments. Kiaraville, the 412-unit luxuriouscondominium development, was completed inMay 2008 and has set a new benchmark in terms ofluxury living in Mont’ Kiara. Comprising of 5 uniqueblocks, ranging from 10-storey to 33-storeybuildings, IECSB has delivered a project of exactingspecifications that includes creating a moderntropical environment for the landscape andcommon areas of the development.

IECSB has also delivered i-ZEN@Kiara I comprising302 units of high-end serviced residences, housedin a single 35-storey block. Built to a modern andchic specification, the now completed i-ZEN@KiaraI with its contemporary designed building is arefreshing addition to the skyline of Mont’ Kiara.

In July 2008, IECSB have been awarded with anadditional new contract for the main buildingconstruction of SENI Mont’ Kiara, a high-endcondominium development, for a total contractsum of RM539.800 million.

Work have all commenced for this project duringthe year under review. The SENI Mont’ Kiara awardis a continuation of the earthworks and pilingcontracts that have been successfully completedby IECSB in early 2008. This contract is awarded byAseana Properties and its joint developmentpartners of CapitaLand Financial Limited.

With its sister company Ireka DevelopmentManagement Sdn Bhd (“IDMSB”) making greatstrides in the property development industry inVietnam; IECSB has taken its first steps byestablishing Ireka Engineering & ConstructionVietnam Company Limited (“IECV”) in Ho Chi MinhCity. IECV has received its business registrationfrom the authorities in Vietnam in April 2008, andwill spearhead the Group’s efforts in developing itsengineering and construction business in Vietnam.

This financial year has also seen the Group makingan opportunistic investment in KinhBac CityDevelopment Shareholding Corporation (“KBC”), acompany engaged in the development,construction and operations of industrial andurban zones, and related infrastructure in Vietnam.The Group through Ireka Venture Capital Limitedacquired 722,000 of new ordinary shares for aconsideration of approximately RM16 million,representing approximately 0.722 percent of KBC’senlarged share capital.

9

Retail Mall & Hotel, Sandakan Harbour Square, Sabah

KBC is an established and leading player in thespace of developing, constructing and operatingindustrial and urban zones. At present, KBC ownsand operates 3 industrial and urban zones, namelyQue Vo Industrial Park, Quang Chau Industrial Park and Phuc Nich Urban Area covering a total landarea of over 1,100 hectares. Complete with soundand modern infrastructure such as heavy capacityroads and dedicated water supply regulatingsystem, these industrial parks are home to multi-national companies such as the likes of Canon,Mitac and Jebsen & Jessen.

The Group believes that this strategic investmentwill provide Ireka with an avenue of venturing intothe infrastructure development and constructionmarket in Vietnam. It is envisaged that the strategicpartnership with KBC will lead to furtherinfrastructure development and constructionopportunities for Ireka in Vietnam.

Property Development Business

With the restructuring of the Group’s propertydevelopment interests under Aseana Properties inthe previous financial year, the Group’s propertydevelopment business has completed its first yearof operations under the stewardship of IDMSB.

As the development manager of AseanaProperties, IDMSB has approximately RM930million, of property development assets under itsmanagement, in terms of value, which is expectedto generate gross development value of overRM5.7 bill ion over the next 7 years. AseanaProperties is a property development companylisted on the Main Market of London StockExchange, and is 19.6 percent owned by the IrekaCorporation Berhad.

Operations Review

10

Queens’ Place, Ho Chi Minh City

11

During the financial year under review, IDMSB hasmade significant progress in bolstering thedevelopment pipeline for Aseana Properties inboth Malaysia and Vietnam. In Malaysia, it hasadded three new exciting projects to its currentproperty portfolio. The first being a prime officeand hotel development project in Kuala LumpurSentral, the most sought after commercial hub inKuala Lumpur today. This project will is a jointventure between Aseana Properties and MalaysiaResources Corporation Berhad.

The second investment in Malaysia is a twin officetowers in the vicinity of Mont’ Kiara. Following thesuccessful launch of the office suites component ofAseana Properties’ one Mont’ Kiara by i-ZENdevelopment, this new development is envisagedto capture the burgeoning demand of office spacein Mont’ Kiara. The third new acquisition is a

pristine piece of beach front property in thepopular tourist destination of Kota Kinabalu. Theland will be developed into a 5-star resort hotel,villas and residential homes.

In Vietnam, IDMSB has helped Aseana Propertiesgain a foothold in Vietnam by securing four newinvestments. The Nam Khang Resort & Residencesis a luxury resort and high-rise residentialdevelopment located in Da Nang, in centralVietnam, a city renowned for its miles long ofpristine white beach. The second investment is aprime office development project named the WallStreet Centre, located in the central businessdistrict of Ho Chi Minh City.

Aseana Properties has also recently acquired astrategic minority stake in a leading Vietnamesedeveloper, Nam Long Investment Corporation(“Nam Long”). This investment in Nam Long hassecured Aseana Properties with a steady stream ofprojects in the coming years. To cap on the list ofrecent achievements in Vietnam, Aseana Propertieshas been awarded with it its first InvestmentLicense for the Horizon Place mixed-commercialand residential development in District 4 of Ho ChiMinh City. These recent successes in Vietnam are atestament of IDMSB’s strong capabilities and on-the-ground presence.

During the calendar year to date, IDMSB is alsopleased to have completed and successfullyhanded over i-ZEN@Kiara I luxury servicedresidences to its end buyers. i-ZEN@Kiara I is thefirst completed property development project ofAseana Properties managed by IDMSB.

Aside from our core function of propertydevelopment management, we have continued togrow and cultivate our niche as a ‘one-stop’development company to enable us to service ourend-buyers better. We have grown our DesignServices Division, in correlation with the number ofdevelopment projects that are to be completed inthe coming years. The Design Services Divisionhave contributed positively to the interior designwork for Kiaraville and i-ZEN@Kiara I as well asconceptual mock-up works for the retail mall ofone Mont’ Kiara. We have also added strength toour Leasing and Building Management Divisions toensure that the end buyers are better served, andthat the capital values of their properties arenurtured and optimised.

The coming year will see IDMSB busy with theimplementation of the various projects under theAseana Properties stable in both Malaysia andVietnam. The management acknowledges thatMalaysia and Vietnam will not be immune to theeconomic impacts of the global credit crisis. Themanagement however believes that a combinationof factors such as attractive designs and products,strategic location of property assets, and thestrong fundamentals of these two countries willcontinue to drive the Group’s propertydevelopment business in the medium to longterm.

Information Technology Business

Financial Year 2007/2008 has been a verychallenging year for i-Tech Network Solutions SdnBhd (“i-Tech”) in the face of increasingly highlycompetitive industry and difficult businessenvironment. Despite this, i-Tech’s sales grew byapproximately 31% from RM9.078 million toRM11.910 million over the previous year.

Operations Review

Kuala Lumpur Sentral

Our business strategy of product diversification implemented over the last few years and ourcontinued quest to live up to our slogan of “Partnership in IT services” have held us in good stead. Wehave managed to retain loyal and committed customers – big and small – providing them with new ITsolutions that enable them to deliver processes efficiently and innovatively. Apart from strongpartnerships with the likes of Utimaco, Computer Associates and Microsoft, for which we have beenrecognised with a preferred partner statuses, i-Tech has also added Managed Service Provider forSophos End Point Security, making us the only managed service provider in Malaysia for this product.Sophos is an anti-virus and anti-spam software for businesses - defending them against known andunknown threats such as malware, spyware and intrusions, and providing comprehensive networkaccess control.

i-Tech also received several awards during the year in review. We were once again honoured with theTop Global Financing Partner Award 2007 from IBM. We are proud to have won this award for the 4thconsecutive year. In addition, we were also awarded the Microsoft Highest Development GrowthPartner 2007, IBM Outstanding Server 2007, Falconstor Recognition Partner 2007, IBM Blue Circle 2007,IBM Top Achiever Q1 Server Award and Lenovo Outstanding Partner 2007.

The coming financial year for i-Tech will remain challenging amidst worldwide economic slowdown. Weare however confident that our prudent management and focused business strategy will see usthrough difficult times ahead. Notwithstanding the tougher economic climate, i-Tech will still be looking for business opportunities not only in Malaysia but outside of our shores. Weare confident of expanding our reach with some of our products and services and leveraging on ourexpertise and reputation into other South East Asian countries such as Vietnam.

12

SENI Mont’ Kiara

Sandakan Harbour Square, Sabah

13

Future Outlook

This financial year has seen our construction andproperty development businesses complementingeach other. On one hand, IECSB has benefited froma steady stream of business opportunities fromAseana Properties’ property development portfolio,albeit on an arms length basis. On the other hand,Aseana Properties has benefited from the certaintyof entrusting the IECSB, a contractor with over 40years of experience and track record, with theresponsibility of delivering its property products,amidst rising material prices and economicuncertainties.

We believe our new strategy for the Group willprovide the agility not only to quickly captureopportunities, but the resilience and resources toweather any impending economic crisis affectingour countries of operations. As such, themanagement believes that both businesses willcontinue to feature strongly in our Group’s earningsin years to come.

On a final note, I would like to thank my colleaguesin the Board and all our dedicated personnel of theGroup for making the Financial Year 2007/2008 asuccessful step into the new decade for the Group. I also wish to extend my thanks to ourshareholders, government authorities, bankers andbusiness associates for their continued support andconfidence in the Company and the Group.

Lai Siew WahGroup Managing Director18 August 2008

Kiaraville, Mont’ Kiara

Operations Review

Five-Year Financial Highlights

14

Group 12 months 12 months 12 months 12 months 12 monthsIn RM’000 to 31.03.08 to 31.03.07 to 31.03.06 to 31.03.05 to 31.03.04

Re-stated

Turnover 299,726 186,542 230,564 434,171 499,902Profit / (Loss) before taxation 158,357 (36,201) (1,342) (4,293) 9,602Profit / (Loss) after taxation and minority interests 152,865 (33,717) (4,505) (12,374) 3,680Issued share capital 113,914.7 113,914.7 113,914.7 113,914.7 112,307.0Shareholders’ funds 236,410 91,893 139,390 146,420 156,919Total assets 635,819 566,409 910,180 895,172 849,570

In SenGross dividend per share 10.0 8.8 - 3.0 -Net earnings per share - Basic 1.34 (29.6) (3.95) (10.9) 3.6Net tangible assets per share 207.5 80.7 111.3 116.7 126.9Return on shareholders’ fund (%) 64.7 (36.7) (3.2) (8.5) 2.3

In Percentage

Gearing 50 175 404 371 303Gearing (net of cash) 19 95 400 365 299

100%i-ZEN PropertyServices Sdn Bhd

100%Ireka Development ManagementSdn Bhd

100%Ireka Sdn Bhd

100%Ireka iCapitalSdn Bhd

100%Ireka Corporation (HK) Limited

100% i-ZEN Commercial Sdn Bhd

100%i-ResidenceSdn Bhd

100%Iswaja EnterpriseSdn Bhd

100%Ireka Engineering & Construction Sdn Bhd

100%Regal Variety Sdn Bhd

100%Regalmont (Sabah)Sdn Bhd

100%i-ZEN HospitalitySdn Bhd

90%Unique Legacy Sdn Bhd

85.1% Legolas Capital Sdn Bhd

100%Ireka VentureCapital Ltd

96%e-AuctionSdn Bhd

100%asiaegolf ToursSdn Bhd

100%i-Tech NetworkSolutions Sdn Bhd

15

Corporate Structure

100%AwarniSdn Bhd

100%United TimeDevelopmentSdn Bhd

Corporate Information

16

DIGI Corporate Office

A Wider Selectionof Products andOptions

17

Corporate Information

Board of Directors

Non-Independent Non-Executive ChairmanHaji Abdullah Bin Yusof

Managing DirectorLai Siew Wah

Deputy Managing DirectorDatuk Lai Jaat Kong @ Lai Foot Kong PJN, JSM

Executive DirectorsChan Soo Har @ Chan Kay ChongLai Man MoiLai Voon HonLai Voon Huey, Monica

Independent Non-Executive DirectorDatuk Haji Burhanuddin Bin Ahmad Tajudin PJN

Kwok Yoke HowHaji Mohd. Sharif Bin Haji Yusof

Audit Committee

ChairmanDatuk Haji Burhanuddin Bin Ahmad Tajudin PJN

MembersKwok Yoke HowHaji Mohd. Sharif Bin Haji YusofLai Voon Huey, Monica

Company SecretaryWong Yim Cheng

Country of domicile & incorporationMalaysia

Legal StatusPublic listed company limited by shares

Registered Office/Principal Place of BusinessNo. 32 Medan Setia DuaBukit Damansara50490 Kuala LumpurTel : 603-20940133Fax : 603-20952096e-mail : [email protected] : www.ireka.com.my

Share RegistrarSymphony Share Registrars Sdn BhdLevel 26, Menara Multi PurposeCapital SquareNo. 8 Jalan Munshi Abdullah50100 Kuala LumpurTel : 603-27212222Fax : 603-27212530

Stock Exchange ListingBursa Malaysia Securities Berhad, Main Board

Stock CodeShares 8834

AuditorsRaja Salleh, Lim & Co.(Audit Firm No. 0071)29A, Jalan SS22/19Damansara Jaya47400 Petaling JayaSelangor Darul Ehsan

Principal BankersAmBank BerhadCIMB Bank BerhadHong Leong Bank BerhadMaybank BerhadOCBC Bank Malaysia BerhadRHB Bank BerhadUnited Overseas Bank (M) Berhad

01__ 02__

01 Haji Abdullah Bin Yusof02 Lai Siew Wah 03 Datuk Lai Jaat Kong @ Lai Foot Kong PJN, JSM

04 Datuk Haji Burhanuddin Bin Ahmad Tajudin PJN

05 Chan Soo Har @ Chan Kay Chong

Board of Directors

1803__ 04__ 05__

Haji Abdullah Bin Yusof

Aged 72, a Malaysian, is the Non-ExecutiveChairman of Ireka and was appointed to theBoard of Directors in 1992. He graduated from theCamborne School of Metalliferous Mining, UnitedKingdom in 1961 and is a registered professionalengineer (mining) with the Board of Engineers,Malaysia. He has extensive experience in tinmining industry, and is currently the ExecutiveChairman of Osborne & Chappel International SdnBhd, a local mine management and engineeringgroup which is involved in the field of miningoperations and related construction works, minemanagement and consultancy, both locally andinternationally. He is the Chairman of CementIndustries of Malaysian Berhad and also anIndependent Non-Executive Director of GopengBerhad and Time Engineering Berhad. He is acouncil member of the Malaysian Chamber ofMines and the Tin Industry (Research andDevelopment) Board.

He is a major shareholder of Ireka, through hisinterest in Magnipact Resources Sdn Bhd.

Lai Siew Wah

Aged 68, a Malaysian, is the founder and GroupManaging Director of Ireka. He was appointed aDirector of Ireka in 1975 and was made theManaging Director of Ireka in 1993. He is amember of the Remuneration Committee and isalso a Director of several subsidiaries within theIreka Group. He has been active in theconstruction industry since 1967 during whichtime he has accumulated vast knowledge andexperience in the implementation andmanagement of construction projects.

He is a major shareholder of Ireka, through hisinterest in Ideal Land Holdings Sdn Bhd.

Datuk Lai Jaat Kong @ Lai Foot KongPJN, JSM

Aged 65, a Malaysian, is the Deputy ManagingDirector of Ireka. He was appointed a Director ofIreka in 1977 and was made the Deputy ManagingDirector in 1993. He is also a Director of severalsubsidiaries within the Ireka Group. He has over30 years experience in the construction industryand is actively involved in activities of relatedtrade organization locally and regionally.Currently, he is the Honorary Life President ofMaster Builders Association Malaysia and servesas Rapportueur in International Federation of Asia& Western Pacific Contractors’ Association(IFAWPCA). He was the Past President/HonoraryAdvisor of the Master Builders AssociationMalaysia and had also served as a CouncilMember of ASEAN Constructors Federation (ACF)and Board Member of Construction IndustryDevelopment Board Malaysia (CIDB).

He is the brother of Mr. Lai Siew Wah

Datuk Haji Burhanuddin Bin Ahmad Tajudin PJN

Aged 76, a Malaysian, is the Senior IndependentNon-Executive Director of Ireka. He was appointedto the Board of Directors in 1994. He is theChairman of both the Audit Committee andNomination Committee and a member of theRemuneration Committee. A lawyer by profession,he had practiced law for 28 years. He is also aDirector of Permodalan Nasional Berhad, AmanahSaham Nasional Berhad, Universal Trustees (M)Berhad and Pelaburan Hartanah Nasional Berhad.

Chan Soo Har @ Chan Kay Chong

Aged 62, a Malaysian, is the Executive Director ofIreka. He joined Ireka in 1975 and was appointedto the Board of Directors in 1990. He is also aDirector of several subsidiaries within the IrekaGroup. He has more than 35 years experience inthe construction industry with sound knowledgein building materials and heavy plants andmachineries.

19

Board of Directors

06Lai Man Moi 06Kwok Yoke How 07

Haji Mohd. Sharif Bin Haji Yusof 08Lai Voon Hon 09

Lai Voon Huey, Monica 10

06__ 07__ 08__

Board of Directors

2009__ 10__

Lai Man Moi

Aged 60, a Malaysian, is the Finance Director ofIreka. She joined Ireka in 1975 and was appointedto the Board of Directors in 1990. She is also aDirector of several subsidiaries within the IrekaGroup. She has more than 30 years experience infinance and accounting and is a member ofseveral institutes including the Association ofAccounting Technicians, United Kingdom; TheInternational Association of Book-Keepers (UK);and The Institute of Commercial Management.

She is the sister of Mr. Lai Siew Wah and thespouse of Mr. Chan Soo Har @ Chan Kay Chong.

Kwok Yoke How

Aged 68, a Malaysian, is an Independent Non-Executive Director of Ireka. He was appointed tothe Board of Directors in 1992. He is the Chairmanof the Remuneration Committee and a member ofthe Audit Committee, Nomination Committee andalso a Director of several subsidiaries within theIreka Group. A lawyer by profession, he hasrecently retired as a consultant to a reputablelegal firm in Kuala Lumpur.

Haji Mohd. Sharif Bin Haji Yusof

Aged 69, a Malaysian, is an Independent Non-Executive Director of Ireka. He was appointed tothe Board of Directors in 2002. He is also amember of the Audit Committee. He is a fellowmember of Institute of Chartered Accountants,England & Wales, Malaysian Institute ofAccountants and Malaysian Association ofCertified Public Accountants. He is also anIndependent Non-Executive Director of APMAutomotive Holdings Berhad, KemayanCorporation Berhad, Axis REIT Managers Berhad,Asia Unit Trust Berhad and DFZ Capital Berhad.

Lai Voon Hon

Aged 44, a Malaysian, is an Executive Director ofIreka and the Chief Executive Officer of IrekaDevelopment Management Sdn Bhd. He joinedIreka in 1994 as the Group General Manager andwas appointed to the Board of Directors in 1996.He is also a Director of several subsidiaries withinthe Ireka Group. He graduated from UniversityCollege London, London University and AshridgeManagement College with Bachelor of Science(Hons) Degree in Architecture in 1987 and Post-graduate Diploma in Architecture (Dip-Arch) in1989 and a Master in Business Administration(“MBA”) (“Distinction”) degree in 1993respectively. An architect by profession, he haspracticed in London, Hong Kong and Malaysiaprior to joining Ireka. He is a registeredProfessional Architect with the Board ofArchitects, Malaysia.

He is a major shareholder of Ireka, through hisinterest in Ideal Land Holdings Sdn Bhd. He is theson of Mr. Lai Siew Wah.

Lai Voon Huey, Monica

Aged 42, a Malaysian, is an Executive Director ofIreka and the Chief Financial Officer of IrekaDevelopment Management Sdn Bhd. She joinedIreka as the Group Financial Controller in 1993and was appointed to the Board of Directors in1999. She is a member of the Audit Committeeand also a Director of several subsidiaries withinthe Ireka Group. She graduated from CityUniversity, London, United Kingdom with aBachelor of Science (Hons) Degree inAccountancy and Economics. She has worked for two international accounting firms in Englandand Hong Kong prior to joining Ireka. She is a fellow member of several institutes that includethe Institute of Chartered Accountants, Englandand Wales; Chartered Accountants, Malaysia; and the Malaysian Institute of Taxation.

She is the daughter of Mr. Lai Siew Wah.

21

Board of Directors

Wong Yim Cheng

Yim Cheng joined Ireka in 2000and is currently the Head,Corporate Affairs / GroupCompany Secretary. Yim Chengis an associate member of theMalaysian Association ofInstitute Chartered Secretariesand Administrators (MAICSA).She has extensive experience incorporate and companysecretarial matters.

Leonard Yee Yuke Dien

Leonard joined Ireka in 2000 andis currently the Group GeneralManager and Chief ExecutiveOfficer of Ireka iCapital Sdn Bhdand i-Tech Network SolutionsSdn Bhd. Leonard graduatedfrom the University of Kingston,Kingston-Upon-Thames, Surrey,England with a Bachelor of Arts(Hons) Degree in IndustrialSocial Sciences. Leonard workedas a Surety and Financial LinesUnderwriter with AmericanInternational Group, Inc inLondon and New York beforereturning to Malaysia in the early1990s. He was an ExecutiveDirector of a local constructioncompany from 1996 to 1999 anda Managing Director of anequities research firm beforejoining Ireka.

Ir. Chen Min Sang

Min Sang joined Ireka in 2002and is currently the Director ofBusiness Development. Hegraduated from the University of Salford, United Kingdom in 1981 with a Bachelor ofScience (Hons) Degree in CivilEngineering. Min Sang has beenregistered as a ProfessionalEngineer with the Board ofEngineers since 1986. He hasover 26 years of experience inthe construction industry as wellas construction business both inMalaysia and overseas.

Chan Chee Kian

Chee Kian joined Ireka in 2006and is currently Senior VicePresident, Strategy & CorporateDevelopment of IrekaDevelopment Management.Chee Kian was previously amanagement and strategyconsultant with Accenture inKuala Lumpur, Singapore andBangkok, where he advised abroad range of clients includinglarge multi-national companies,Government-linked agenciesand local enterprises throughoutAsia Pacific on strategic and operational issues. Hegraduated from University ofBristol, England with a First ClassHonours, Master of EngineeringDegree in Civil Engineering inyear 2000.

Profile of Company Secretary & Senior Management

22

Rosalind Wee Teck Lin

Rosalind joined Ireka in 2008 andis currently the Senior Manager,Group Human Resources.Rosalind graduated fromUniversity of SouthernQueensland, Australia in 2005with a Master of BusinessAdministration, specializing inHuman Resources Management.Prior to joining Ireka, Rosalindhas worked for several MNCs andpublic listed propertydevelopment companies. Shehas more than 15 years ofexperience in managing anddeveloping human capitaldevelopment.

Tan Thiam Chai

Thiam Chai joined Ireka as anEngineer in 1989 and is currentlythe Chief Executive Officer ofIreka Engineering & ConstructionSdn Bhd (“IECSB”). Thiam Chaigraduated from University ofBristol, United Kingdom in 1983with a Bachelor of Science(Hons) Degree in CivilEngineering. He has been aboard member of IECSB sinceAugust 2000 and has 24 years ofexperience in the constructionindustry, in both civilengineering and buildingprojects.

Ng Yau Siong

Yau Siong joined Ireka as anEngineer in 1991 and is currentlya Director (Operations). YauSiong is a board member of IrekaEngineering & Construction SdnBhd since August 2000. Hegraduated from University ofCanterbury, New Zealand in1986 with a Bachelor ofEngineering (Hons) Degree.

Lee Sui San

Sui San joined Ireka as a SeniorProject Manager in 1995 and iscurrently a Project Director. SuiSan graduated from LiverpoolPolytechnic, United Kingdom in1980 with a Diploma inBuildings. Sui San is a CharteredBuilder by profession and amember of the CharteredInstitute of Building (UK),Chartered Management Institute(UK), Technological Associationof Malaysia and MalaysiaInstitute of Management. He hasover 27 years of constructionmanagement experience inconstruction industry,particularly in the constructionof high rise luxury hotel,commercial building and serviceapartment, hospital, factory andresidential houses.

Lee Chay Line

Chay Line joined Ireka in 1985and is currently the Director ofQuantity Surveying. Chay Linegraduated from InstituteTeknologi Union in 1985 withthe Technician Diploma and was awarded a Bachelor ofApplied Science (ConstructionManagement and Economics)Degree by Curtin University,Australia in 1999.

23

Profile of Senior Management

Annabel Chua

Annabel joined Ireka in 2005and is currently the Head,Legal/Contracts of IrekaEngineering & Construction SdnBhd. Annabel graduated fromThe Catholic University ofAmerica in Washington, DC witha Bachelor of Architecture(Design). While working withOng Keng Poh Architect, sheread law and obtained herBachelor of Laws (Hons) degreefrom the University of London.She has previously practised inAzman Davidson & Co. in thearea of construction lawlitigation and arbitration andwas a Contracts Manager withKLCC Projeks Berhad prior tojoining Ireka.

Lim Ech Chan

Ech Chan joined Ireka in 2007and is currently the ChiefOperating Officer of IrekaDevelopment Management SdnBhd. Prior to joining Ireka, EchChan held senior position in a public l isted propertydevelopment company. He hasmore than 22 years ofexperience in the propertydevelopment and is a registeredProfessional Town Planner withBoard of Town Planners,Malaysia and also a member ofRoyal Town Planning Institute,London and Malaysian Instituteof Planners, Malaysia.

Frankie Heng

Frankie joined Ireka in 2005 andis currently the Senior VicePresident, Hospitality andProperty Management of IrekaDevelopment Management Sdn Bhd. Frankie has over 30years experience in financialmanagement in the hospitalityindustry in corporate finance,treasury, internal audit and atoperational levels of the hotels.He has worked overseas for 14years in Hong Kong, Fiji Islands,Singapore, Indonesia andThailand with the Shangri-Laand Kuok Group and in KL forthe Mandarin Oriental, Regentand Merlin Hotels group.

Tam Cheok Wing

Cheok Wing joined Ireka in 2008and is currently the CountryHead of Vietnam. Cheok Winggraduated from the University ofManchester Insitute of Scienceand Technology, UnitedKingdom with a BachelorDegree in Civil Engineering, aPostgraduate Diploma in TownPlanning (Oxford Polytechnic)and an MBA from theStrathclyde University, UK.Cheok Wing held various seniorpositions in companies such asGroup General Manager inMagnum Corporation Berhad in-charge of China Operations from1994 till 2008, Senior Manager(Projects) of Bandar RayaDevelopment Berhad from1984-1989 and as GeneralManager, Capital Square SdnBhd from 1989-1994. He hadalso served as a Planning Officerwith the Dewan Bandaraya,Kuala Lumpur from 1979-1981.

Lawrence Har Soon Thim

Lawrence joined Ireka in 2001and is currently the Senior Vice President, PropertyDevelopment and the ChiefRepresentative of Ireka inVietnam. Lawrence graduatedfrom Central State University of Oklahama, USA with Honours Degree in BusinessAdministration (major in Finance and General Business).He has over 26 years ofexperience in the propertydevelopment and constructionindustry, in particular, project business development, projectplanning, administration andmanagement.


24

Beh Chun Chong

Beh joined Ireka in 2007 and iscurrently the Senior VicePresident, Operations. Prior to joining Ireka, Beh held senior position in a propertydevelopment company. Hegraduated from the UniversitiTeknologi Malaysia in 1994 witha Bachelor of Civil Engineering(Hons) Degree.

Albert Wong Mun Sum

Albert joined Ireka in 2008 and is currently the Senior Vice President, CorporateFinance of Ireka DevelopmentManagement Sdn Bhd. Agraduate from University of NewSouth Wales, Sydney, Australiawith a Bachelor of CommerceDegree in Accounting, Finance &Systems and a Masters Degreespecializing in ManagementAccounting. Albert held seniorposition in a public l istedcompany before joining Ireka.

Crissy Lee Pooi Ling

Crissy joined Ireka in 2007 and iscurrently the Senior VicePresident, Finance of IrekaDevelopment Management SdnBhd. Crissy is a member of boththe Chartered Institute ofManagement Accountants(CIMA) and Malaysia Institute ofAccountants (MIA). Crissy hasvast experience in treasurymanagement, project financingand sales administration functionin property developmentindustry.

Kevin Lim Tek Wee

Kevin joined Ireka in 2006 and is currently the Vice President,Sales and Marketing of IrekaDevelopment Management SdnBhd. Kevin is a graduate ofUniversity of Sydney, Australia,with a Bachelor of EconomicsDegree. He spent a short stint inIndia working with a pioneertownship development by a Malaysian developer in 2003and has been involved innegotiations and consultationswith the Malaysian Governmenton industry wide matters prior tojoining Ireka.

Yap Ket Bin

K.B. joined Ireka in 2008 and iscurrently the Chief OperationOfficer of i-Tech NetworkSolutions Sdn Bhd. K.B.graduated from the Iowa StateUniversity, Ames, USA with aBachelor of Science Degree inComputer Science. He has over 7 years of experience in theinformation technology industry.


25

Corporate Calendar

26

PaintingBeautiful NewEnvironments

27

Corporate Calendar

April 2007• The Ireka’s Sports & Recreational Club held its 11th Annual General Meeting at Bukit Kiara

Equestrian & Country Resort for election of a new committee for year 2007/2008.

• Ireka marked a historical milestone as Aseana Properties Limited was listed on the MainMarket, The London Stock Exchange.

• Ireka hosted an Appreciation Night to thank its long time business associates, bankers,consultants, suppliers and sub-contractors at The Westin Kuala Lumpur.

May 2007• An Extraordinary General Meeting of Ireka was held at Bukit Kiara Equestrian & Country Resort

to seek shareholders’ approval for the disposal of its entire shareholding in Ireka Land Sdn Bhdand ICSD Ventures Sdn Bhd to Aseana Properties Limited.

• Ireka Group’s 2007 Annual Dinner themed “Masquerade” was held at The Westin Kuala Lumpur,Grand Ballroom.

June 2007• Ireka presented an inaugural charity movie premiere

“Perfect Stranger” in aid of Kiwanis Children EducationFund.

August 2007• Ireka’s Family Day was held at Forest Research Institute

of Malaysia to foster relationships among staff.

• The Managing Director of Ireka, Mr. Lai Siew Wah andExecutive Director, Mr. Lai Voon Hon had a courtesymeeting with His Execellency Nguyen Tan Dung, thePrime Minister of Vietnam during His Execellency’svisit to Malaysian.

September 2007• Ireka announced the entitlement of 10% interim

dividend of 10% less income tax of 27% per share

• Ireka held its 31st Annual General Meeting and anExtraordinary General Meeting at Bukit KiaraEquestrian & Country Resort, Kuala Lumpur.

• A charity auction was held at SENI Gallery, Mont’ Kiarain conjunction with the launch of Terry Fox Run KL2007, to raise funds in aid of Cancer ResearchInitiatives Foundation (CARIF).

December 2007 • Ireka Group’s Sport & Recreational Club organized

trips to Tasik Temenggor, Pahang and Bali, Indonesia.

January 2008• Ireka organized the inaugural weekend i-ZEN Bazaar

at i-ZEN@Kiara II.

March 2008• Ireka announced the acquisition of a strategic stake in

KinhBac City Development Shareholding Corporation,a corporation listed on the Hanoi Stock Exchange forapproximately RM16 million.

Corporate Social Responsibility Statement

28

Ireka Corporation Berhad Group (Ireka) is committed tothe practice of good corporate citizenship andresponsibility. The Board of Directors of Ireka aims tointegrate all business plans and activities with corporatesocial responsibility values which will enhance interestsand values of our shareholders, investors, customers,employees and to the community at large. The Boardensures its commitment towards excellent business ethicswhich include timely delivery of quality products andservices, elimination of occupational health hazards,achieving accident-free operations, conservation andpreservation of the natural environment, ensuring healthand safety at work place and caring for the multi-racialcommunities.

Specifically, Ireka has always supported social benefitworks related to alleviation of poverty, health, educationand training, sports, arts, culture and heritage regardlessof race, creed and religion. Some of charitableorganizations/funds/events that have benefited fromIreka’s efforts are as follows:

• The Kiwanis Children Education Fund

• Tunku Azizah Fertility Foundation

• Cancer Research Initiatives Foundation (CARIF)

• Malaysian Association for the Blind

• Malaysian Aids Foundation

• Montford Boys Town

• Kiwanis Club, Bukit Kiara

Ireka has been supporting the community in the area ofarts and culture. One such contribution is the donation toKwong Ngai Lion Dance Association.

Ireka will continue in its best effort to play its role as aresponsible and good corporate citizen. The Board ofDirectors, Management and Staff of all levels willcontinuously find ways to upgrade and improve on ouroverall performance to ensure the achievement of ourvision to be a progressive and globally focusedcorporation, which prides itself on proven track record inperformance, reliability, excellence in quality andcreativity in all services and products that we offer.

29

Corporate Governance Statement

The Board of Directors confirms that the Group hascomplied with the best practices in the Code throughoutthe financial year ended 31 March 2008. Set out below is astatement of how the Group has applied the principles ofthe Code.

A. THE BOARD OF DIRECTORS

i. The Board

An effective Board leads and controls the Group.The Board meets at least four times a year, withadditional meetings being held as necessary.During the year ended 31 March 2008, the Boardmet for a total of five (5) times. Every Directorattended all the Board meetings held during thefinancial year except Lai Siew Wah, Haji Mohd.Sharif bin Haji Yusof and Kwok Yoke How whoabsent once each, and Lai Voon Hon who absenttwice due to their respective unforeseencircumstances.

The Board has delegated specific responsibilitiesto four subcommittees i.e. Audit Committee,Nomination Committee, RemunerationCommittee and Risk Management Committee,which have authority to examine issues and reportto the Board.

ii. Board Balance

The Board currently has ten members comprisinga Non-Executive Chairman, six Executive Directorsand three Independent Non-Executive Directors.Together, the Directors bring a wide range ofbusiness, legal, finance and accountingexperience and expertise required to successfullydirect and supervise the business activities of theGroup. The profiles of these Directors are providedon pages 18 to 21 of this Annual Report.

There is a clear division of responsibility betweenthe Chairman and the Group Managing Directorto ensure that there is a balance of power andauthority.

There is also balance in the Board because of thepresence and participation of Independent Non-Executive Directors to bring independentjudgment in Board decisions. The roles of theseIndependent Non-Executive Directors areimportant in ensuring that the strategiesproposed by the Executive Management are fullydeliberated and take into account the interest ofthe Group.

iii. Supply of Information

All Board members are provided with a Boardreport containing relevant documents andinformation prior to board meeting to enable theDirectors to discharge their duties effectively.

The Board, whether as a full Board or in theirindividual capacity, has a right to takeindependent professional advice, if necessary, atthe Group’s expense.

In addition, all Directors have access to the adviceand services of the Company Secretary, who isresponsible for ensuring that the Board meetingprocedures, applicable rules and regulations areadhered to.

iv. Appointments to the Board

The Code endorses as good practice, a formalprocedure for appointments to the Board, with a Nomination Committee makingrecommendations to the full Board. TheNomination Committee consists of Datuk HajiBurhanuddin Bin Ahmad Tajudin (IndependentNon-Executive Chairman), Kwok Yoke How(Independent Non-Executive Director) and HajiAbdullah Bin Yusof (Non-Executive Director).

These Directors are responsible for identifying,recruiting and recommending candidates forDirectorships and also to fill the seats of BoardCommittees. In addition, the NominationCommittee assesses the effectiveness of the Boardas a whole and the Board Committees, and alsothe contribution of each Director. The Board,through the Nomination Committee, reviewsperiodically its required mix of skills andexperience and other qualities, including corecompetencies, which Non-Executive Directorsshould bring to the Board.


30

The Directors from time to time attend trainingprogrammes, seminars and talks to keep abreastwith recent developments of the state ofeconomy, technology, management strategies,laws and regulations to enhance their knowledgeand skills in order to discharge their dutieseffectively.

v. Re-election of Directors

Article 91 of the Company’s Articles of Associationprovides that all Directors shall retire from office atleast once in every three years, but shall beeligible for re-election.

In accordance with Section 129(6) of theCompanies Act, 1965, Haji Abdullah bin Yusof andDatuk Haji Burhanuddin Bin Ahmad Tajudin whoare over the age of seventy years will be retiring atthe forthcoming Annual General Meeting andbeing eligible, offers themselves for re-appointment to be passed by a majority of notless than three-fourths of such members of theCompany at the meeting.

B. DIRECTORS’ REMUNERATION

i. The level and make-up of remuneration

The Board has adopted the objective asrecommended by the Malaysian Code ofCorporate Governance to determine theremuneration for a Director so as to ensure it issufficient to attract and retain the Directorsneeded to manage the Group successfully. In thecase of Executive Directors, the component partsof remuneration are structured so as to linkrewards to corporate and individual performance.In the case of Non-Executive Directors, the level ofremuneration reflects the experience and level ofresponsibilities undertaken by the particular Non-Executive Directors concerned.

ii. Procedure

The Code endorses that, as a good practice, aRemuneration Committee be comprised wholly ormainly of Non-Executive Directors. TheRemuneration Committee comprises Kwok YokeHow (Independent Non-Executive Chairman),Datuk Haji Burhanuddin Bin Ahmad Tajudin(Independent Non-Executive Director) and LaiSiew Wah (Executive Director).

The Committee is responsible for recommendingthe remuneration packages to Executive Directorsfor consideration and approval by the Board. TheExecutive Directors play no part in decision ontheir own remuneration.

The Committee has met once to review theremuneration packages of Executive Directorsbased on their responsibilities and scope of work,corporate and individual performance.

The determination of the remuneration of theNon-Executive Directors is a matter for the Boardas a whole. The Company reimburses reasonableexpenses incurred by these Directors in the courseof their duties as Directors. Non-ExecutiveDirectors do not participate in decision on theirown remuneration packages.

The Directors’ fees are recommended by the Boardand approved by the shareholders at the AnnualGeneral Meeting.

iii. Disclosure

The details of the remuneration of Directorsduring the financial year ended 31 March 2008 areas follows:-

31


1. Aggregate remuneration of Directors categorized into appropriatecomponents:-

In Bonus & Benefits-RM’000 Salaries Fees Incentives in-Kind Total

ExecutiveDirectors 3,300 220 570 0 4,090

Non-Executive Directors 0 130 0 0 130

2. Number of Directors whose remuneration falls into the following bands:-

Range of Number of DirectorsRemuneration Executive Non-Executive

Below RM50,000 – 4RM550,001 – RM600,000 3 –RM600,001 – RM650,000 1 –RM650,001 – RM700,000 0 –RM700,001 – RM750,000 1 –RM750,001 – RM800,000 0 –RM800,001 – RM850,000 1 –

C. SHAREHOLDERS

i. Dialogue Between The Company and Investors

The Group values dialogue with shareholders and investors. The Chairman andExecutive Directors hold discussions with shareholders and journalistsimmediately after general meetings. The Executive Directors together with theManagement also hold regular meetings with analysts and investors to presentand update the Group’s strategy, performance and major developments regularly.

In addition, the Group has a website, www.ireka.com.my that shareholders andinvestors can access for information.

ii. Annual General Meetings

Notice of the Annual General Meeting and related papers are sent out to theshareholders at least 21 days before the date of the meeting.

The Annual General Meeting is the principal forum for dialogue withshareholders. All shareholders are encouraged to participate in the question andanswer session. Every opportunity is given to the shareholders to ask questionsand seek clarification on the business and affairs of the Company and the Group.

Each item of special business included in the notice of the meeting will beaccompanied by a full explanation of the purpose and effect of a proposedresolution. The Chairman declares the number of proxy votes received both forand against each resolution.


32

D. ACCOUNTABILITY AND AUDIT

i. Financial Reporting

The Board aims to present a balanced, clear andmeaningful assessment of the Group’s positionand prospect in all their reports to theshareholders, investors and regulatory authorities.This assessment is primarily provided in theannual report through the Chairman’s Statement,Operations Review and the Statement ofDirectors.

The timely quarterly results announcements alsoreflect the Board’s commitment to give regularupdated assessment on the Group’sperformances.

ii. Statement of Directors’ Responsibility ForPreparing The Financial Statements

The Directors are required by the Companies Act,1965 to prepare financial statements for eachfinancial year which have been made out inaccordance with the applicable approvedaccounting standards and give a true and fair viewof the state of affairs of the Group and Companyat the end of the financial year and of the resultsand cash flows of the Group and Company for thefinancial year.

In preparing the financial statements, theDirectors have:

• applied suitable and approved accountingpolicies consistently

• made reasonable, prudent judgment andestimates

• ensured strict adherence of all applicableaccounting standards

• prepared financial statements on the goingconcern basis as the Directors have areasonable expectation, having madeenquiries, that the Group and Company haveadequate resources to continue in operationalexistence for the foreseeable future.

The Directors have responsibility for ensuring thatthe Company keeps accounting records whichdisclose with reasonable accuracy the financialposition of the Group and Company and whichenable them to ensure that the financialstatements comply with the Companies Act, 1965.

The Directors have overall responsibilities fortaking such steps as are reasonably open to themto safeguard the assets of the Group to preventand detect fraud and other irregularities.

iii. Internal Control

The Group’s Internal Control Statement is set outon page 33.

iv. Relationship With The Auditors

The role of the Audit Committee in relation to theExternal Auditors is stated on pages 34 to 35.

v. Audit Committee

In compliance with the good practice of the Code,the current Audit Committee comprises theChairman who is the Senior Independent Non-Executive Director, two Independent Non-Executive Directors and an Executive Director whois a member of the Malaysian Institute ofAccountants. The composition and report of theAudit Committee for the year ended 31 March2008 is set out on pages 34 to 35 of this AnnualReport.

HAJI ABDULLAH BIN YUSOFCHAIRMAN

LAI SIEW WAHGROUP MANAGING DIRECTOR18 August 2008

33

Internal Control Statement

RESPONSIBILITY

The Board of Directors acknowledges their overallresponsibility and is committed to maintain soundinternal controls which cover financial controls andoperational and compliance controls as well as riskmanagement in the Group. However, it should be notedthat such systems are designed to manage rather thaneliminate the risk of failure to achieve business objectives;and that any system can provide only reasonable, and notabsolute, assurance against material misstatement or loss.

The Group has in place a formal approach towardsidentifying, evaluating, monitoring and managing thesignificant risks affecting the achievement of its businessobjectives. This is an ongoing process and is regularlyreviewed by the Board. The Board’s Internal ControlStatement, as prepared in accordance with the ListingRequirements of Bursa Malaysia, has been reviewed bythe External Auditors and reported the results thereof tothe Board.

i. INTERNAL CONTROL

The Group has adopted the concept of Enterprise-Wide Risk Management Framework which identifiesand manages inherent and controllable risks affectingthe Group in order to achieve corporate objectives.The Enterprise-Wide Risk Management processcontains a number of key elements being:

• identification of key corporate risks associated withthe organizational mission, vision, strategies andobjectives;

• measurement of these risks in terms of the possibilityof occurrence and the impact on the organisation;

• evaluation of existing controls to manage the risks;

• confirming accountability and time lines formanaging and monitoring the controls;

• identification of residue risks;

• deciding on risk treatment;

• development of action plans to manage residual risks;and

• continuous monitoring to ensure compliance andupdate risk assessment.

The Enterprise-Wide Risk Management approach via theCorporate Risk Scorecard system enables riskmanagement to be conducted in an effective manner andproactive controls to be established.

ii. INTERNAL AUDIT FUNCTION

The Audit Committee has renewed the engagementof Messrs. Audex Governance Sdn Bhd as theoutsourced Internal Auditors to assist the Board ofDirectors reviewing the adequacy, integrity andeffectiveness of the Group’s system of internal control.The two-year Internal Audit Plan covering financialyears ending 2008 to 2009 is subject to reviewannually to take account of changes that may arise inthe business, regulatory and operating environmentand from the findings arising from the audits. Thescope of the Internal Audit may cover the audits of alloperations and subsidiary companies.

OTHER KEY ELEMENTS OF INTERNAL CONTROL

The other key elements of the Group’s internal controlsystems are described as follows:-

• clearly defined delegation of responsibilities tocommittees of the Board and to Management of

operating units, including authorization levels for allrespects of the business which are set out in theauthority matrix;

• clearly documented internal procedures in respect ofoperational and financial processes as set out in theMS ISO Quality System Documents and the FinancialProcesses Manual;

• regular and comprehensive information provided toManagement, covering financial performance and keybusiness indicators;

• a detailed budgeting process where operating unitsprepare budgets for coming year and theconsolidated budget approved by the Board;

• monitoring of results against budget, with majorvariances being followed up and Management actionstaken, where necessary;

• regular visits to operating units by SeniorManagement and Board Members;

• regular review of business to assess effectiveness ofinternal controls’

• review and approval of annual internal audit plan bythe Audit Committee on behalf of the Board; and

• periodic meetings between Audit Committee andoutsourced Internal Auditors on internal control issuesidentified in reports prepared by the outsourcedInternal Auditors.

A number of internal control weaknesses were identifiedduring the period which are being rectified and improved.None of the weaknesses have resulted in any materiallosses, contingencies or uncertainties that would requiredisclosure in the Annual Report.

Audit Committee Report

34

Composition of Audit Committee

As at 31 March 2008, the Audit Committee comprisesthree Independent Non-executive Directors with DatukHaji Burhanuddin bin Ahmad Tajudin as Chairman. Thecomposition of the Committee is found on page 17 of thisAnnual Report.

Frequency of meetings

The Committee had five meetings during the financialyear which were attended by all the members except for Mr. Kwok Yoke How who absent once due to hisunforeseen commitment.

Summary of activities

During the period, the Audit Committee carried out itsduties as set out in the terms of reference.

Other main issues discussed by the Audit Committee areas follows:-

• Review of the Group’s quarterly reports prepared incompliance with Malaysian Accounting StandardsBoard (MASB) Standard 26 “ Interim FinancialReporting” and Chapter 9 of Bursa Malaysia’s ListingRequirements prior to submission to the Board forconsideration and approval;

• Application of new accounting policies i.e. theFinancial Reporting Stands (FRS) to the consolidatedfinancial statements for the financial year ended 31March 2008;

• Review of audited financial statements for financialyear 31 March 2008 with the external auditors prior torecommending the same to the Board for approval;

• Review of the proposed general mandate for recurrent related party transactions of aRevenue/Trading Nature.

• Review of the re-appointment of Internal Auditorsand its term of reference and audit program for theFinancial Years Ending 31 March 2008 and 2009.

• Review of internal audit reports and the internalauditors’ recommendations for effective internalcontrol system.

Terms of Reference of the Audit Committee

1. Membership

• The Committee shall be appointed by the Boardfrom amongst the Directors and shall consist ofnot less than three (3) members, a majority ofwhom shall be Independent Non-executiveDirectors.

• At least one member of the Committee must be amember of the Malaysian Institute of Accountantsor similar qualification as prescribed in Part 1 orPart II of the First Schedule of the Accountants Act,1967 with at least 3 years’ working experience.

• No alternate Director may be appointed as amember of the Committee.

• The members of the Committee shall elect aChairman from among their members who shallbe an Independent Non-executive Director.

• In the event of any vacancy in the Committeeresulting in the number of Directors falling belowthree (3) members, the Board of Directors must fillthe vacancy within three (3) months to make upthe minimum number of three (3) members.

2. Authority

• The Committee is authorised by the Board toinvestigate any matter within its terms ofreference.

• The Committee is authorised to any information itrequires from any employee and all employees aredirected to co-operate with any request made bythe Committee.

• The Committee shall have unrestricted access toany information pertaining to the Group, fromboth the internal and external auditors, and havethe power to carry out internal audit function oractivity and is able to convene meetings with theexternal auditors excluding the attendance of theexecutive members of the Committee wheneverdeemed necessary.

35


• The Committee is authorised to obtain externallegal of other independent professional advice asnecessary.

3. Duties and Responsibilities

The duties of Committee shall be among others:-

(i) To review the following and report the same tothe Board of Directors:-

a) with the external auditors, the audit plan;

b) with the external auditors, their evaluation ofthe system of internal controls;

c) with the external auditors, the audit report;

d) the assistance given by the employees of theCompany to the external auditors;

e) the adequacy of the scope, functions andresources of the internal audit functions andthat it has the necessary authority to carry outits work;

f ) the internal audit programme, processes, theresults of the internal audit programme,processes or investigation undertaken andwhether or not appropriate action is taken onthe recommendations of the internal auditfunction;

g) the quarterly results and year end financialstatements, prior to the approval by the board ofdirectors, focusing particularly on:-

(i) compliance with accounting standards andother legal requirements; and

(ii) significant and unusual events;

h) any related party transaction and conflict ofinterest situation that may arise within theCompany or group including any transaction,procedure or course of conduct that raisesquestions of management integrity;

i) any letter of resignation from the external auditorsof the Company;

j) whether there is a reason (supported by grounds)to believe that the Company’s external auditors isnot suitable for re-appointment; and

(ii) To promptly report to the Bursa Malaysia of mattersreported by the Audit Committee to the Board ofDirectors which has not been satisfactorily resolved,resulting in a breach of the Bursa Malaysia’s ListingRequirement.

(iii) To recommend the nomination of a person or personsas external auditors.

4. Meetings

• Meetings shall be held not less than four (4) timesa year.

• A quorum shall be three (3) members, majority ofwhom must be Independent Non-executiveDirectors.

• Other Directors & employees may attend anyparticular Audit Committee Meeting only at theCommittee’s invitation, specific to the relevantmeeting.

• The Company Secretary shall be the Secretary tothe Committee.

5. Reporting procedure

The Secretary shall circulate the minutes of theCommittee’s meetings to all members of the Board.The Chairman of the Committee shall report on eachmeeting to the Board.

Review of the audit Committee

The Board of Directors must review the terms of office andperformance of the Committee and each of its membersat least once every three (3) years to determine whetherthe Committee and its members have carried out theirduties in accordance with the terms of reference.


36

On the Roadto Solid,SustainableGrowth

Financial Statements

Directors’ Report 38

Statement by Directors 44

Statutory Declaration 45

Auditors’ Report 46

Balance Sheets 48

Income Statements 50

Consolidated Statements of Changes in Equity 51

Company Statements of Changes in Equity 52

Consolidated Cash Flow Statements 53

Company Cash Flow Statements 56

Notes to the Financial Statements 58

37

The Directors have pleasure in submitting their report together with the audited financial statements of the Group and of the Company for the financial year ended 31 March 2008.

PRINCIPAL ACTIVITIES

The principal activities of the Company are investment holding, provision of management services, civil, structural and building construction, earthworks and renting of constructionplant and machinery.

The principal activities of the subsidiaries and companies within the Group are stated in Note 10 to the financial statements.

There have been no significant changes in these principal activities during the financial year under review.

FINANCIAL RESULTS

Group CompanyRM RM

Profit after taxation from continuing operations 151,752,539 39,387,288 Profit for the year from discontinued operations 1,110,783 –Profit for the year 152,863,322 39,387,288

Attributable to :Equity holders of the Company 152,864,715 39,387,288 Minority interests (1,393) –Profit for the year 152,863,322 39,387,288

DIVIDENDS

Since the end of the previous financial year, an interim dividend of 10% per share, less 27% income tax amounting to RM8,315,773 in respect of the financial year ended 31 March2008 was paid out during the financial year under review.

At the forthcoming Annual General Meeting, a final dividend in respect of the financial year ended 31 March 2008, of 10% less 26% taxation on 113,914,700 ordinary shares,amounting to a dividend payable of RM8,429,688 (7.4 sen net per ordinary share) will be proposed for shareholders’ approval. The financial statements for the current financial yearhas not reflected this proposed dividend. Such dividend, if approved by the shareholders, will be accounted for in equity as an appropriation of retained earnings in the financial yearending 31 March 2009.

38

Directors’ Report

DIRECTORS OF THE COMPANY

The Directors who held office during the year since the date of the last report are :

Haji Abdullah Bin YusofLai Siew WahDatuk Lai Jaat Kong @ Lai Foot Kong PJN, JSM

Chan Soo Har @ Chan Kay ChongLai Man MoiKwok Yoke HowDatuk Haji Burhanuddin Bin Ahmad Tajudin PJN

Lai Voon HonLai Voon Huey Haji Mohd Sharif Bin Haji Yusof

DIRECTORS’ BENEFITS

During and at the end of the previous financial year, no arrangements subsisted to which the Company or its subsidiaries is a party, with the object of enabling Directors of the Company to acquire benefits by means of the acquisition of shares or debentures of the Company or any other body corporate.

No Director has, since the end of the previous financial year, received or become entitled to receive a benefit (other than a benefit included in the aggregate amount of emoluments received or due and receivable by the Directors shown in the financial statements or the fixed salary of a full-time employee of the Company) 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 interestexcept as disclosed in Note 36 to the financial statements.

39

Directors’ Report (cont’d)

DIRECTORS’ INTERESTS

According to the register of Directors’ shareholdings, the interests of Directors in office at the end of the financial year in the ordinary shares of the Company were as follows :

Interest in ordinary shares of the Company :

Number of ordinary shares of RM1 each

At At1.4.2007 Addition Disposal 31.3.2008

Direct -Datuk Lai Jaat Kong @ Lai Foot Kong PJN, JSM 4,827,100 – – 4,827,100Chan Soo Har @ Chan Kay Chong 2,184,750 – – 2,184,750Lai Man Moi 2,040,750 – – 2,040,750Haji Abdullah Bin Yusof 1,500,000 – – 1,500,000Kwok Yoke How 1,742,603 – – 1,742,603Datuk Haji Burhanuddin Bin Ahmad Tajudin PJN 235,700 – – 235,700Lai Voon Hon 12,000 – – 12,000Lai Voon Huey 6,000 – – 6,000

Indirect -Lai Siew Wah 49,001,998 – – 49,001,998Lai Voon Hon 49,001,998 – – 49,001,998Lai Voon Huey 49,001,998 – – 49,001,998Haji Abdullah Bin Yusof 15,398,248 – – 15,398,248

RESERVES AND PROVISIONS

All material transfers to or from reserves or provisions during the financial year are shown in the financial statements.

ISSUE OF SHARES AND DEBENTURES

There has been no change in the issued and paid-up capital of the Company during the financial year.

The Group and the Company have not issued any debentures during the financial year.

BAD AND DOUBTFUL DEBTS

Before the income statement and the balance sheet were made out, the Directors took reasonable steps to ascertain that action has been taken in relation to the writing off of baddebts and the making of provision for doubtful debts, and have satisfied themselves that all known bad debts have been written off and that adequate provision has been made fordoubtful debts.

At the date of this report, the Directors are not aware of any circumstances which would render the amounts written off of bad debts or the amount of the provision for doubtfuldebts in the financial statement of the Group and of the Company inadequate to any substantial extent.

40


CURRENT ASSETS

Before the income statement and the balance sheet were made out, the Directors took reasonable steps to ensure that any current assets, other than debts, which were unlikely to berealised in the ordinary course of business including their values as shown in the accounting records of the Group and of the Company have been written down to an amount whichthey might be expected to realise.

At the date of this report, the Directors are not aware of any circumstances which would render the values attributed to the current assets in the financial statements of the Group andof the Company misleading.

VALUATION METHODS

At the date of this report, the Directors are not aware of any circumstances which have arisen which render adherence to the existing method of valuation of assets or liabilities of theGroup and of the Company misleading or inappropriate.

CONTINGENT AND OTHER LIABILITIES

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

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

(b) any contingent liability of the Group and of the Company which has arisen since the end of the financial year except as disclosed in Note 37 to the financial statements.

No contingent or other liability has become enforceable or is likely to become enforceable within the period of twelve months after the end of the financial year which, in the opinionof the Directors, will or may affect the ability of the Group and of the Company to meet their obligations when they fall due.

CHANGE OF CIRCUMSTANCES

At the date of this report, the Directors are not aware of any circumstances not otherwise dealt with in this report or the financial statements of the Group and of the Company whichwould render any amounts stated in the financial statements misleading.

ITEMS OF AN UNUSUAL NATURE

The results of the operations of the Group and of the Company for the financial year ended 31 March 2008 were not, in the opinion of the Directors, substantially affected by any item,transaction or event of a material and unusual nature.

41


SHARE BUY-BACK

The Company did not purchase any own shares during the financial year ended 31 March 2008.

AMERICAN DEPOSITORY RECEIPT (“ADR”)/GLOBAL DEPOSITORY RECEIPT (“GDR”)

The Company did not sponsor any ADR or GDR programme during the financial year ended 31 March 2008.

SANCTIONS AND/OR PENALTIES IMPOSED

There were no sanctions and/or penalties imposed on the Company and its subsidiaries, Directors or management by the relevant regulatory bodies during the financial year ended31 March 2008.

VARIANCES IN RESULTS

The variance between the financial results ended 31 March 2008 and the unaudited results previously announced is less than 10%.

PROFIT GUARANTEE

There were no profit guarantees given by the Company during the financial year ended 31 March 2008.

MATERIAL CONTRACTS

There were no material contracts entered into by the Company and/or its subsidiary companies which involved Directors’ and major shareholders’ interest, either still subsisting at theend of the financial year or entered into since the end of the previous financial year.

EVENTS SUBSEQUENT TO BALANCE SHEET DATE

There has not arisen in the interval between the end of the financial year and the date of this report any item, transaction or event of a material and unusual nature likely, in theopinion of the Directors, to affect substantially the results of the operations of the Group and of the Company for the financial year in which this report is made except as disclosed inNote 40 to the financial statements.

42


AUDITORS

The retiring auditors, Raja Salleh, Lim & Co., have indicated their willingness to be re-appointed in accordance with Section 172(2) of the Companies Act, 1965.

SIGNED ON BEHALF OF THE BOARD IN ACCORDANCE WITH A RESOLUTION OF THE DIRECTORS

LAI SIEW WAH DATUK LAI JAAT KONG @ LAI FOOT KONG PJN, JSM

Director DirectorKuala Lumpur - 31 July 2008

43


We, LAI SIEW WAH and DATUK LAI JAAT KONG @ LAI FOOT KONG PJN, JSM, being two of the Directors of IREKA CORPORATION BERHAD, do hereby state that, in the opinion of the Directors, the financial statements as set out on pages 48 to 116 are drawn up in accordance with applicable approved accounting standards in Malaysia so as to give a true and fairview of the state of affairs of the Group and of the Company as at 31 March 2008 and of the results of their operations, changes in equity and of the cash flows of the Group and of the Company for the year ended on that date.

SIGNED ON BEHALF OF THE BOARD IN ACCORDANCE WITH A RESOLUTION OF THE DIRECTORS

LAI SIEW WAH DATUK LAI JAAT KONG @ LAI FOOT KONG PJN, JSM

Director DirectorKuala Lumpur - 31 July 2008

44

Statement by Directors Pursuant to Section 169 (15) of the Companies Act, 1965

I, LAI VOON HUEY, being the Director primarily responsible for the accounting records and financial management of IREKA CORPORATION BERHAD, do solemnly and sincerelydeclare that the financial statements as set out on pages 48 to 116 are, to the best of my knowledge and belief, correct and I make this solemn declaration conscientiously believingthe same to be true, and by virtue of the provisions of the Statutory Declarations Act, 1960.

Subscribed and solemnly declared by LAI VOON HUEYNRIC No. 660508-10-6572at KUALA LUMPURin the state of WILAYAH PERSEKUTUANon 31 July 2008

LAI VOON HUEY

Before me,

Commissioner for Oaths

45

Statutory Declaration Pursuant to Section 169 (16) of the Companies Act, 1965

REPORT ON THE FINANCIAL STATEMENTS

We have audited the financial statements of IREKA CORPORATION BERHAD, which comprise the balance sheets as at 31 March 2008 of the Group and of the Company, and theincome statements, statements of changes in equity and cash flow statements of the Group and of the Company for the year then ended, and a summary of significant accountingpolicies and other explanatory notes, as set out on pages 48 to 116.

Directors’ Responsibility for the Financial Statements

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

Auditors’ Responsibility

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

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

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

Opinion

In our opinion, the financial statements have been properly drawn up in accordance with Financial Reporting Standards and the Companies Act 1965 in Malaysia so as to give a trueand fair view of the financial position of the Company as of 31 March 2008 and of its financial performance and cash flows for the year then ended.

46

Independent Auditors’ Report to the Members of Ireka Corporation Berhad

REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS

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

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

(b) We have considered the accounts and the auditors’ reports of all the subsidiaries of which we have not acted as auditors, which are indicated in Note 10 to the financialstatements.

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

(d) The audit reports on the accounts of the subsidiaries did not contain any qualification or any adverse comment made under Section 174(3) of the Act.

OTHER MATTERS

This report is made solely to the members of the Company, as a body, in accordance with Section 174 of the Companies Act 1965 in Malaysia and for no other purpose. We do not assume responsibility to any other person for the content of this report.

RAJA SALLEH, LIM & CO. AF-0071Chartered Accountants

LIM KIM CHEONG116/3/09 (J/PH)Chartered Accountant

Petaling Jaya - 31 July 2008

47

Independent Auditors’ Report to the Members of Ireka Corporation Berhad (cont’d)

Group Company2008 2007 2008 2007

Note RM RM RM RMASSETSNon-current assetsProperty, plant and equipment 8 51,940,039 31,173,928 14,234,146 12,625,435Investment properties 9 4,272,100 4,272,100 – –Investment in subsidiaries 10 – – 49,586,987 49,486,983Investment in jointly controlled entities 11 182,959 229,733 70,000 70,000Other investments 12 150,361,048 5,741,426 149,310,100 4,601,900Land held for property development 13 10,809,340 – – –

217,565,486 41,417,187 213,201,233 66,784,318Current assetsProperty development costs 14 5,514,514 8,738,696 – –Inventories 15 13,528,997 9,340,900 – –Trade and other receivables 16 182,964,610 105,901,192 43,997,740 19,502,920Amounts due from customers on contracts 17 15,505,490 59,223,584 – 17,654,530Amounts due from jointly controlled entities 18 11,395,932 11,635,433 11,528,632 11,324,476Amounts due from subsidiaries 19 – – 37,136,341 88,463,494Cash and cash equivalents 20 73,555,465 73,409,945 5,117,349 27,553

302,465,008 268,249,750 97,780,062 136,972,973Assets of disposal group classified as held for sale 32 115,788,571 256,741,964 6 4,350,000

418,253,579 524,991,714 97,780,068 141,322,973TOTAL ASSETS 635,819,065 566,408,901 310,981,301 208,107,291

The accompanying notes form an integral part of these financial statements

48

Balance Sheets AS AT 31 MARCH 2008

Group Company2008 2007 2008 2007

Note RM RM RM RMEQUITY AND LIABILITIESEquity attributable to equity holders of the companyShare capital 21 113,914,700 113,914,700 113,914,700 113,914,700Share premium 21,891,585 21,923,906 21,891,585 21,923,906Other reserves 22 (184,609) (184,609) – –Retained earnings/(Accumulated losses) 100,788,436 (43,760,506) 26,261,638 (4,809,877)

236,410,112 91,893,491 162,067,923 131,028,729Minority interests 115,911 3,977,630 – –Total equity 236,526,023 95,871,121 162,067,923 131,028,729

Non-current liabilitiesBorrowings 23 31,325,490 27,506,114 2,828,450 1,795,011Deferred taxation 24 3,222,500 3,197,014 610,000 610,000

34,547,990 30,703,128 3,438,450 2,405,011Current liabilitiesTrade and other payables 25 157,176,337 108,929,267 1,347,167 2,381,815Amounts due to subsidiaries 19 – – 139,456,066 26,620,703Borrowings 23 86,302,906 133,293,110 4,671,695 45,671,033Taxation 5,461,253 1,422,812 – –

248,940,496 243,645,189 145,474,928 74,673,551Liabilities directly associated with the assets as held for sale 32 115,804,556 196,189,463 – –

364,745,052 439,834,652 145,474,928 74,673,551Total liabilities 399,293,042 470,537,780 148,913,378 77,078,562TOTAL EQUITY AND LIABILITIES 635,819,065 566,408,901 310,981,301 208,107,291


49

Balance Sheets AS AT 31 MARCH 2008 (cont’d)

Group Company2008 2007 2008 2007

Note RM RM RM RMContinuing operationsRevenue 26 299,726,451 186,541,583 10,900,784 7,204,800 Cost of sales 27 (313,712,295) (207,305,818) (21,063,498) (1,906,575) Gross (loss)/profit (13,985,844) (20,764,235) (10,162,714) 5,298,225 Other income 28 208,244,425 33,515,505 66,969,647 1,013,868 Administration expenses (16,268,916) (11,544,480) (9,029,068) (7,082,305) Other expenses (13,819,763) (23,209,071) (5,955,915) (3,017,199) Operating profit/(loss) 164,169,902 (22,002,281) 41,821,950 (3,787,411)Finance costs 29 (5,765,781) (14,208,109) (2,434,662) (3,929,088) (Loss)/Profit from jointly controlled entities (46,774) 9,479 – –Profit/(Loss) before tax 30 158,357,347 (36,200,911) 39,387,288 (7,716,499) Income tax expense 31 (6,604,808) 1,643,326 – – Profit/(Loss) for the year from continuing operations 151,752,539 (34,557,585) 39,387,288 (7,716,499) Discontinued operationsProfit for the year from discontinued operation 32 1,110,783 1,274,365 – – Profit/(Loss) for the year 152,863,322 (33,283,220) 39,387,288 (7,716,499)

Attributable to: Equity holders of company 152,864,715 (33,716,706) 39,387,288 (7,716,499)Minority interests (1,393) 433,486 – – Profit/(Loss) for the year 152,863,322 (33,283,220) 39,387,288 (7,716,499)

Profit/(Loss) per share attributable to equity holders to the Company (sen)Basic, for profit/(loss) from continuing operations 133.21 (30.72) Basic, for profit from discontinued operations 0.98 1.12Basic, for profit/(loss) for the year 33 134.19 (29.60)


50

Income Statements FOR THE YEAR ENDED 31 MARCH 2008

Attributable to Equity Holders of the Company

Non-Distributable Distributable

(Accumulated losses)/

Share Share Other Retained Minority Totalcapital premium reserves earnings Total interest equity

RM RM RM RM RM RM RM

As at 1 April 2007 113,914,700 21,923,906 (184,609) (43,760,506) 91,893,491 3,977,630 95,871,121Disposal of subsidiaries – – – – – (3,860,326) (3,860,326)Dividends – – – (8,315,773) (8,315,773) – (8,315,773)Profit/(Loss) for the year – – – 152,864,715 152,864,715 (1,393) 152,863,322Transaction costs – (32,321) – – (32,321) – (32,321)As at 31 March 2008 113,914,700 21,891,585 (184,609) 100,788,436 236,410,112 115,911 236,526,023

As at 1 April 2006 113,914,700 21,937,906 (57,097) 3,594,364 139,389,873 1,043,895 140,433,768Addition in equity interest – – – – – 2,500,250 2,500,250Dividends – – – (8,548,159) (8,548,159) – (8,548,159)Distribution to holder of preference shares – – – (5,090,005) (5,090,005) – (5,090,005)Foreign currency translation – – (127,512) – (127,512) – (127,512)(Loss)/Profit for the year – – – (33,716,706) (33,716,706) 433,486 (33,283,220)Transaction costs – (14,000) – – (14,000) – (14,000)Redemption of redeemable preference shares – – – – – (1) (1)As at 31 March 2007 113,914,700 21,923,906 (184,609) (43,760,506) 91,893,491 3,977,630 95,871,121


51

Consolidated Statements of Changes in Equity FOR THE YEAR ENDED 31 MARCH 2008

Non-Distributable DistributableRetained

profits/Share Share (Accumulated

capital premium losses) TotalRM RM RM RM

Balance as at 1 April 2006 113,914,700 21,937,906 11,454,781 147,307,387

Loss for the year – – (7,716,499) (7,716,499)Transaction costs – (14,000) – (14,000)Dividends – – (8,548,159) (8,548,159)

Balance as at 31 March 2007 113,914,700 21,923,906 (4,809,877) 131,028,729

Profit for the year – – 39,387,288 39,387,288Transaction costs – (32,321) – (32,321)Dividends – – (8,315,773) (8,315,773)

Balance as at 31 March 2008 113,914,700 21,891,585 26,261,638 162,067,923


52

Company Statements of Changes in Equity FOR THE YEAR ENDED 31 MARCH 2008

2008 2007Note RM RM

Cash flow from operating activitiesProfit/(Loss) before tax from -

Continuing operations 158,357,347 (36,200,911)Discontinuing operations 1,562,725 3,999,137

Adjustments for :Other investments - Impairment loss 2,200,000 –Provision for foreseeable loss 100,000 –Writeback of allowance for doubtful debts (183,303) –Gain on disposal of subsidiaries (205,648,677) (29,908,950)Unrealised gain in foreign exchange – (127,512)Impairment loss of goodwill – 12,579,358Interest expenses

Continuing operations 5,765,781 14,208,109Discontinuing operations 7,185,217 15,722

Interest income (3,945,574) (1,547,102)Allowance for doubtful debts – 237,161Bad debts written off – 676,000Share of loss/(profit) of jointly controlled entities 46,774 (9,479)Property, plant and equipment

- Depreciation 2,419,655 2,021,236- Gain on disposals (1,534,957) (1,234,401)- Loss on disposals 101,819 15,165- Written off – 2,512

(33,573,193) (35,273,955)Property development costs 3,224,182 28,286,760Inventories (4,188,097) (12,117,142)Receivables (54,614,358) (12,387,149)Amounts due from customers on contracts 43,718,094 15,603,563Amounts due from jointly controlled entities 239,501 (4,022)Amounts due from associated companies 39,900 –Payables 38,505,795 (24,955,018)Net cash flow used in operating activities (6,648,176) (40,846,963)Income tax paid (2,657,762) (6,797,531)Net cash flow used in operating activities (9,305,938) (47,644,494)


53

Consolidated Cash Flow Statements FOR THE YEAR ENDED 31 MARCH 2008

2008 2007Note RM RM

Cash flow from investing activitiesInterest income 3,945,574 1,547,102Property, plant and equipment

- Additions (17,573,515) (11,520,073)- Disposals 2,331,849 1,939,190

Investment in associate (6) –Investment properties - Additions – (4,272,100)Land held for property development (1,088,800) (14,125,931)Other investments - Additions (148,308,200) –Proceeds from disposal of subsidiaries 32 233,224,187 212,405,362Proceeds from disposal of investments 1,488,578 –Advances to joint ventures (112,000,000) –Net cash flow (used in)/generated from investing activities (37,980,333) 185,973,550


54

Consolidated Cash Flow Statements FOR THE YEAR ENDED 31 MARCH 2008 (cont’d)

2008 2007 Note RM RM

Cash flow from financing activitiesBorrowing costs capitalised (4,040) (18,212,866)Dividends paid to shareholders (8,315,773) (8,548,159)Distribution to holders of preference shares – (5,090,004)Transaction costs (32,321) (14,000)Hire purchase principal repayments (1,661,439) (1,258,933)Interest paid (12,950,998) (14,223,831)Drawdown of bank borrowings 215,783,216 150,133,344Proceeds from issue of redeemable preference shares – 101Proceeds from shares issued to minority shareholder of a subsidiary – 1,600,149Repayment of bank borrowings (148,985,622) (154,610,761)Repayment of loan from minority shareholder – (15,849,800)Redemption of redeemable preference shares – (1)

Net cash flow generated from/(used in) financing activities 43,833,023 (66,074,761)

Net (decrease)/increase in cash and cash equivalents (3,453,248) 72,254,295Cash and cash equivalents- at start of year 56,903,945 (15,350,350)- at end of year 20 53,450,697 56,903,945


55

Consolidated Cash Flow Statements FOR THE YEAR ENDED 31 MARCH 2008 (cont’d)

2008 2007Note RM RM

Cash flow from operating activitiesProfit/(Loss) before tax 39,387,288 (7,716,499)Adjustments for :Bad debts written off – 676,000Other investments - Impairment loss 2,200,000 –Gain on disposal of subsidiary (65,837,572) –Interest expenses 2,434,662 3,929,088Interest income (1,021,435) (2,400)Property, plant and equipment

- Depreciation 590,797 216,504- Gain on disposal (9,608) (794,834)- Loss on disposal 273 –

(22,255,595) (3,692,141)Receivables (24,494,820) (1,282,242)Amounts due from customers on contracts 17,654,530 1,300,000Amount due from jointly controlled entity (204,156) –Amounts due from subsidiaries 164,162,516 28,423,185Payables (1,034,648) (3,716,117)Net cash flow generated from operating activities 133,827,827 21,032,685

Cash flow from investing activitiesProceeds from disposal of subsidiary 70,187,572 –Proceeds from disposal of investments 1,400,000 –Investment in subsidiaries (100,004) (3,750,002)Investment in associate (6) –Interest received 1,021,435 2,400Property, plant and equipment

- Additions (453,273) (151,501)- Disposals 30,800 795,134

Other investments - Additions (148,308,200) –Net cash flow used in investing activities (76,221,676) (3,103,969)


56

Company Cash Flow Statements FOR THE YEAR ENDED 31 MARCH 2008

2008 2007 Note RM RM

Cash flow from financing activitiesDividends paid to shareholders (8,315,773) (8,548,159)Transaction costs (32,321) (14,000)Hire purchase principal repayments (333,667) (111,237)Interest paid (2,434,662) (3,929,088)Repayment of bank borrowings (40,684,201) (2,195,917)Net cash flow used in financing activities (51,800,624) (14,798,401)

Net increase in cash and cash equivalents 5,805,527 3,130,315Cash and cash equivalents

- at start of year (867,032) (3,997,347)- at end of year 20 4,938,495 (867,032)


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Company Cash Flow Statements FOR THE YEAR ENDED 31 MARCH 2008 (cont’d)

1. PRINCIPAL ACTIVITIES

The principal activities of the Company during the financial year under review are investment holding, provision of management services, civil, structural and buildingconstruction, earthworks and renting of construction plant and machinery.

The principal activities of the subsidiaries are described in Note 10 to the financial statements.

2. DATE OF AUTHORISATION OF ISSUE

The financial statements were authorised for issue by the Board of the Directors on 31 July 2008.

3. FINANCIAL RISK MANAGEMENT OBJECTIVE AND POLICIES

The main areas of financial risks faced by the Group are foreign currency exchange risk, interest rate risk, credit risk, market risk, liquidity and cash flow risks. The Group’s overall financial risk management objective is to ensure that the Group enhances shareholders’ value. The Group establishes and operates within financial risk management policies approved by the Board of Directors to ensure that adequate financial resources are available for the development of the Group’s businesses whilst managing these risks. Financialrisk management is carried out through risk reviews, internal control systems and adherence to the Group’s financial risk management policies.

(a) Foreign currency risk

The Group is exposed to foreign currency risk as a result of the foreign currency transactions entered into by subsidiaries arisen from their normal trading activities in currencies other than the local currency, Ringgit Malaysia (“RM”). The Group’s policy is to minimise the exposure on foreign currency by matching foreign currencyreceivables against foreign currency payables.

(b) Interest rate risk

The Group’s policy is to borrow principally on the floating rate basis but to retain a proportion of fixed rate debt. The objectives for the mix between fixed and floating rateborrowings are set to reduce the impact of an upward change in interest rates while enabling benefits to be enjoyed if interest rates fall.

(c) Credit risk

Credit risk is controlled by ensuring that sales of services and products are made to customers with an appropriate credit history and the application of credit limits andmonitoring procedures. The Group also seeks to invest cash assets prudently and profitably.

(d) Market risk

The Group faces exposure to the risk from changes in debt and equity prices. However, the management regularly reviews these risks and takes proactive measures to mitigate the potential impact of such risks. For key product purchases, the Group establishes floating and fixed price levels that the Group considers appropriate.

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Notes to the Financial Statements FOR THE YEAR ENDED 31 MARCH 2008

3. FINANCIAL RISK MANAGEMENT OBJECTIVE AND POLICIES (Continued)

(e) Liquidity and cash flow risks

The Group actively manages its debt maturity profile, operating cash flows and the availability of fund so as to ensure that all funding needs are met. As part of its overall prudent liquidity management, the Group maintains sufficient levels of cash to meet its working capital requirements.

4. SEGMENTAL REPORTING

The Group is organised into five main business segments :

• Construction • Property development • Trading and services• Hospitality and leisure• Investment holding

Segment revenues and expenses are those directly attributable to the segments and include any joint revenues and expenses where a reasonable basis of allocation exists. Segment assets include all assets used by a segment and consist principally of cash, receivables, inventories, intangibles and property, plant and equipment, net of allowancesand accumulated depreciation and amortisation. Most segment assets can be directly attributed to the segments on a reasonable basis. Segment assets and liabilities do notinclude income tax assets and liabilities respectively.

Segment revenues, expenses and result include transfers between segments. The prices charged on intersegment transactions are the same as those charged for similar goods toparties outside of the economic entity at an arm’s length transactions. These transfers are eliminated on consolidation.

5. SIGNIFICANT ACCOUNTING POLICIES

(a) Basis of preparation

The financial statements comply with the provisions of the Companies Act, 1965 and applicable MASB Approved Accounting Standards in Malaysia for Entities Other Than Private Entities. At the beginning of the current financial year, the Group and the Company had adopted new and revised FRSs which are mandatory for financial periods beginning on or after 1 April 2007 as described fully in Note 6.

The financial statements of the Group and of the Company have also been prepared on a historical basis.

The financial statements are presented in Ringgit Malaysia (“RM”).

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Notes to the Financial Statements FOR THE YEAR ENDED 31 MARCH 2008 (cont’d)

5. SIGNIFICANT ACCOUNTING POLICIES (Continued)

(b) Subsidiaries

Subsidiaries are entities over which the Group has the ability to control the financial and operating activities so as to obtain benefits from their activities. The existence andeffect of potential voting rights that are currently exercisable or convertible are considered when assessing the Group has such power over another entity.

In the Company’s separate financial statements, investments in subsidiaries are stated at cost less impairment losses. On disposal of such investments, the difference between net disposal proceeds and their carrying amounts is included in profit or loss.

The consolidated financial statements comprise the financial statements of the Company and its subsidiaries as at the balance sheet date. The financial statements of thesubsidiaries are prepared for the same reporting date as the Company.

Subsidiaries are consolidated from the date of acquisition, being the date on which the Group obtains control, and continue to be consolidated until the date that suchcontrol ceases. In preparing the consolidated financial statements, intragroup balances, transactions and unrealized gains or losses are eliminated in full. Uniform accountingpolicies are adopted in the financial statements for like transactions and events in similar circumstances.

Acquisitions of subsidiaries are accounted for using the purchase method. The purchase method of accounting involves allocating the cost of the acquisition to the fair valueof the assets acquired and liabilities and contingent liabilities assumed at the date of acquisition. The cost of an acquisition is measured as the aggregate of the fair values, atthe date of exchange, of the assets given, liabilities incurred or assumed, and equity instruments issued, plus and costs directly attributable to the acquisition.

Any excess of the cost of the acquisition over the Group’s interest in the net fair value of the identifiable assets, liabilities and contingent liabilities represents goodwill.

Any excess of the Group’s interest in the net fair value of the identifiable assets, liabilities and contingent liabilities over the cost of acquisition is recognised immediately inprofit or loss.

Minority interests represent the portion of profit or loss and net assets in subsidiaries not held by the Group. It is measured at the minorities’ share of the fair value of thesubsidiaries’ identifiable assets and liabilities at the acquisition date and the minorities’ share of changes in the subsidiaries’ equity since then.

(c) Jointly controlled entities

Jointly controlled entities are corporations, partnerships or other entities over which there is contractually agreed sharing of control by the Group with one or more parties.

Investments in jointly controlled entities are accounted for in the consolidated financial statements using the equity method of accounting.

The share of results of the joint ventures is included in the financial statements from the date of formation of the joint ventures to the date of completion of the projects.Joint venture earnings on the contract-in-progress are recognised on the percentage of completion method determined through the matching of progress billingsreceivable (including retentions) certified based on work performed to the costs incurred where the outcome of the contract can be reliably estimated. Costs includematerial, labour and overheads.

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(c) Jointly controlled entities (Continued)

The share of the jointly controlled assets are included in the financial statements, classified according to nature of the assets; any liabilities which they have incurred; theirshare of any liabilities incurred jointly with the other venturers in relation to the joint venture; any income from sale or use of their share of the output of the joint venturetogether with their share of any expenses incurred by the joint venture; any expenses which they have incurred in respect of their interest in the joint venture.

In the Company’s separate financial statements, investments in jointly controlled entities are stated at cost less impairment losses.

On disposal of such investments, the difference between net disposal proceeds and their carrying amounts is included in profit or loss.

(d) Intangible assets

Goodwill

Goodwill acquired in a business combination is initially measured at cost being the excess of the cost of business combination over the Group’s interest in the fair value of theidentifiable assets, liabilities and contingent liabilities. Following the initial recognition, goodwill is measured at cost less any accumulated impairment losses. Goodwill is notamortised but instead, it is reviewed for impairment, annually or more frequently if events or changes in circumstances indicate that the carrying value may be impaired.Gains and losses on the disposal of an entity include the carrying amount of goodwill relating to the entity sold.

(e) Property, plant and equipment and depreciation

All items of property, plant and equipment are initially recorded at cost. Subsequent costs are included in the asset’s carrying amount or recognised as a separate asset, as appropriate, only when 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. The carrying amount of the replaced part is derecognised. All other repairs and maintenance are charged to the income statement during the financial period in which they are incurred.

Subsequent to recognition, property, plant and equipment except for freehold land are stated at cost less accumulated depreciation and any accumulated impairmentlosses.

Freehold land is stated at cost less any accumulated impairment losses.

Freehold land has an unlimited useful life and therefore is not depreciated. Depreciation of other property, plant and equipment is provided for on a reducing balance basisto write off the cost of each asset to its residual value over the estimated useful life, at the following annual rates :

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(e) Property, plant and equipment and depreciation (Continued)

%Building 2Plant and machinery 10-20Motor vehicles 20Office equipment 10-25Furniture and fittings 10Computers 25

The residual values, useful life and depreciation method are reviewed at each financial year end to ensure that the amount, method and period of depreciation are consistentwith previous estimates and the expected pattern of consumption of the future economic benefits embodied in the items of property, plant and equipment.

An item of property, plant and equipment is derecognised upon disposal when no future economic benefits are expected from its use or disposal. The difference betweenthe net disposal proceeds, if any and the net carrying amount is recognised in profit or loss and the unutilised portion of the revaluation surplus on that item is taken directlyto retained earnings.

The Group has not adopted a policy of revaluation on its landed properties as at the end of financial year ended 31 March 2008.

(f) Investment properties

Investment properties are properties which are held either to earn rental income or for capital appreciation or for both. Such properties are measured at cost, including transaction costs.

Investment properties are derecognised when either they have been disposed of or which the investment property is permanently withdrawn from use and no futureeconomic benefit is expected from its disposal. Any gains or losses on the retirement or disposal of an investment property are recognised in profit or loss in the year inwhich they arise.

(g) Land held for property development and property development costs

(i) Land held for property development

Land held for property, plant and equipment consists of land where no development activities have been carried out or where development activities are not expectedto be completed within the normal operating cycle. Such land is classified within non-current assets and is stated at cost less any accumulated impairment losses.

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(g) Land held for property development and property development costs (Continued)

(i) Land held for property development (Continued)

Land held for property development is reclassified as property development costs at the point when development activities have commenced and where it can be demonstrated that the development activities can be completed within the normal operating cycle.

(ii) Property development costs

Property development costs comprise all costs that are directly attributable to development activities or that can be allocated on a reasonable basis to such activities.

When the financial outcome of a development activity can be reliably estimated, property development revenue and expenses are recognised in the income statementby using the stage of completion method. The stage of completion is determined by the proportion that property development costs incurred for work performed todate bear to the estimated total property development costs.

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

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

Property development costs not recognised as an expense are recognised as an asset, which is measured at the lower of cost and net realisable value.

The excess of revenue recognised in the income statement over billings to purchases is classified as accrued billings within trade receivables and the excess of billings topurchasers over revenue recognised in the income statement is classified as progress billings within trade payables.

(h) Construction contracts

Where the outcome of a construction contract can be reliably estimated, contract revenue and contract costs are recognised as revenue and expenses respectively by usingthe stage of completion method. The stage of completion is measured by reference to the proportion of contract costs incurred for works performed to date to the estimatedtotal contract costs.

Where the outcome of a construction contract cannot be reliably estimated, contract revenue is recognised to the extent of contract costs incurred that it is probable will berecoverable. Contract costs are recognised as expenses in the period in which they are incurred.

When it is probable that total contract costs will exceed total contract revenue, the expected loss is recognised as an expense immediately.

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(h) Construction contracts (Continued)

When the total of costs incurred on construction contracts plus, recognised profits (less recognised losses) exceeds progress billings, the balance is classified as amount duefrom customers on contracts. When progress billings exceed costs incurred plus, recognised profits (less recognised losses), the balances is classified as amount due tocustomers on contracts.

(i) Inventories

Inventories are stated at lower of cost and net realisable value.

Cost is determined using the weighted average basis. The cost of raw materials comprises costs of purchase. The costs of finished goods and work-in-progress comprise costsof raw materials, direct labour, other direct costs and appropriate proportion of manufacturing overheads based on normal operating capacity. The cost of unsold propertiescomprises cost associated with the acquisition of land, direct costs and appropriate proportions of common costs.

Net realisable value is the estimated selling price in the ordinary course of business less the estimated costs of completion and the estimated costs necessary to make thesale.

(j) Impairment of non-financial assets

The carrying amounts of assets, other than investment property, construction contract assets, property development costs, inventories, deferred tax assets and non-currentassets (or disposal groups) held for sale, are reviewed at each balance sheet date to determine whether there is any indication of impairment. If any such indication exists, theasset’s recoverable amount is estimated to determine the amount of impairment loss.

For goodwill, intangible assets that have an indefinite useful life and intangible assets that are not yet available for use, the recoverable amount is estimated at each balancesheet date or more frequently when indicators of impairment are identified.

For the purpose of impairment testing of these assets, recoverable amount is determined on an individual asset basis unless the asset does not generate cash flows that arelargely independent of those from other assets. If this is the case, recoverable amount is determined for the cash-generating unit (“CGU”) to which the asset belongs to.Goodwill acquired in a business combination is, from the acquisition date, allocated to each of the Group’s CGUs, or group of CGUs, that are expected to benefit from thesynergies of the combination, irrespective of whether other assets or liabilities of the Group are assigned to those units or groups of units.

An asset’s recoverable amount is the higher of an asset’s or CGU’s fair value less costs to sell and its value in use. In assessing value in use, the estimated future cash flows arediscounted 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. Wherethe carrying amount of an assets exceed its recoverable amount, the asset is considered impaired and is written down to its recoverable amount. Impairment lossesrecognised in respect of a CGU or group of CGUs are allocated first to reduce the carrying amount of any goodwill allocated to those units or groups of units and then, toreduce the carrying amount of the assets in the unit or groups of units on a pro-rata basis.

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(j) Impairment of non-financial assets (Continued)

An impairment loss is recognised in profit or loss in the period in which it arises, unless the asset is carried at a revalued amount, in which case the impairment loss isaccounted for as a revaluation decrease to the extent that the impairment loss does not exceed the amount held in the asset revaluation reserve for the same asset.

Impairment loss on goodwill is not reversed in a subsequent period. An impairment loss for an asset other than goodwill is reversed if, and only if, there has been a change inthe estimates used to determine the asset’s recoverable amount since the last impairment loss was recognised. The carrying amount of an asset other than goodwill isincreased to its revised recoverable amount, provided that this amount does not exceed the carrying amount that would have been determined (net of amortization ordepreciation) had no impairment loss been recognised for the asset in prior years. A reversal of impairment loss for an asset other than goodwill is recognised in profit or loss,unless the asset is carried at revalued amount, in which case, such reversal is treated as a revaluation increase.

(k) Financial instruments

Financial instruments are recognised in the balance sheet when the Group has become a party to the contractual provisions of the instrument.

Financial instruments are classified as liabilities or equity in accordance with the substance of the contractual arrangement. Interest, dividends and gains and losses relatingto a financial instrument classified as a liability, are reported as expense or income. Distributions to holders of financial instruments classified as equity are recognised directlyin equity. Financial instruments are offset when the Group has a legally enforceable right to offset and intends to settle either on a net basis or to realise the asset and settlethe liability simultaneously.

(i) Cash and cash equivalents

For the purpose of the cash flow statement, cash and cash equivalents include cash on hand and at bank, deposits at call and short term highly liquid investments whichhave an insignificant risk of changes in value, net of outstanding bank overdrafts.

(ii) Other non-current investments

Non-current investments other than investments in subsidiaries, associates, jointly controlled entities and investment properties are stated at cost less impairmentlosses. On disposal of an investment, the difference between net disposal proceeds and its carrying amount is recognised in profit or loss.

(iii) Marketable securities

Marketable securities are carried at the lower of cost and market value, determined on an aggregate basis. Cost is determined on the weighted average basis whilemarket value is determined based on quoted market values. Increase or decrease in the carrying amount of marketable securities are recognised in profit or loss. Ondisposal of marketable securities, the difference between net disposal proceeds and the carrying amount is recognised in profit or loss.

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(k) Financial instruments (Continued)

(iv) Trade receivables

Trade receivables are carried at anticipated realisable values. Bad debts are written off when identified. An estimate is made for doubtful debts based on a review of alloutstanding amounts as at the balance sheet date.

(v) Trade payables

Trade payables are stated at the fair value of the consideration to be paid in the future for goods and services received.

(vi) Interest bearing loans and borrowings

All loans and borrowings are initially recognised at the fair value of the consideration received less directly attributable transaction costs. After initial recognition, interestbearing loans and borrowings are subsequently measured at amortised cost using the effective interest method.

(vii) Equity instruments

Ordinary shares are classified as equity. Dividends on ordinary shares are recognised in equity in the period in which they are declared.

The transaction costs of an equity transaction are accounted for as a deduction from equity, net of tax. Equity transaction costs comprise only those incremental externalcosts directly attributable to the equity transaction which would otherwise have been avoided.

The consideration paid, including attributable transaction costs on repurchased ordinary shares of the Company that have not been cancelled, are classified as treasuryshares and presented as a deduction from equity. No gain or loss is recognised in profit or loss on the sale, re-issuance or cancellation of treasury shares. When treasuryshares are reissued by resale, the difference between the sale consideration and the carrying amount is recognised in equity.

(viii)Derivative financial instruments

Derivative financial instruments are not recognised in the financial Statements.

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(l) Leases

(i) Classification

A lease recognised as a finance lease if it transfers substantially to the Group all the risks and rewards incidental to ownership. Leases of land and buildings are classifiedas operating or finance leases in the same way as leases of other assets and the land and building elements of a lease of land and buildings are considered separately forthe purpose of lease classification. All leases that do not transfer substantially all the risks and rewards are classified as operating leases, with the following exceptions :

• Property held under operating leases that would otherwise meet the definition of an investment property is classified as an investment property on a property-by-property basis and, if classified as investment property, is accounted for as if held under a finance lease [Note 5(f )]; and

• Land held for own use under an operating lease, the fair value of which cannot be measured separately from the fair value of a building situated thereon at theinception of the lease, is accounted for as being held under a finance lease, unless the building is also clearly held under an operating lease.

(ii) Finance leases – The Group as Lessee

Assets acquired by way of hire purchase or finance leases are stated at an amount equal to the lower of their fair values and the present value of the minimum leasepayments at the inception of the leases, less accumulated depreciation and impairment losses. The corresponding liability is included in the balance sheet asborrowings. In calculating the present value of the minimum lease payments, the discount factor used in the interest rate implicit in the lease, when it is practicable todetermine; otherwise, the Company’s incremental borrowing rate is used. Any initial direct costs are also added to the carrying amount of such assets.

Lease payments are apportioned between the finance costs and the reduction of the outstanding liability. Finance costs, which represents the difference between thetotal leasing commitments and the fair value of the assets acquired, are recognised in the profit or loss over the term of the relevant lease so as to produce a constantperiodic rate of charge on the remaining balance of the obligations for each accounting period.

The depreciation policy for leased assets is in accordance with that for depreciable property, plant and equipment as described in Note 5(e).

(iii) Operating leases – The Group as Lessee

Operating lease payments are recognised as an expense on a straight-line basis over the term of the relevant lease. The aggregate benefit of incentives provided by thelessor is recognised as a reduction of rental expense over the lease term on a straight-line basis.

In the case of a lease of land and buildings, the minimum lease payments or the up-front payments made are allocated, whenever necessary, between the land and thebuildings elements in proportion to the relative fair values for leasehold interests in the land element and buildings element of the lease at the inception of the lease.The up-front payment represents prepaid lease payments and are amortised on a straight-line basis over the lease term.

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(l) Leases (Continued)

(iv) Operating leases – The Group as Lessor

Assets leased out under operating leases are presented on the balance sheets according to the nature of the assets. Rental income from operating leases is recognisedon a straight-line basis over the term of the relevant lease [(Note 5(r)(v)]. Initial direct costs incurred in negotiating and arranging an operating lease are added to thecarrying amount of the leased asset and recognised on a straight-line basis over the lease term.

(m) Borrowing costs

Borrowing costs directly attributable to the acquisition, construction or production of qualifying assets, which are assets that necessarily take a substantial period of time toget ready for their intended use or sale, are added to the cost of those assets, until such time as the assets are substantially ready for their intended use or sale. Investmentincome earned on the temporary investment of specific borrowings pending their expenditure on qualifying assets is deducted from the borrowing costs eligible forcapitalisation.

All other borrowing costs are recognised in profit or loss in the period in which they are incurred.

(n) Income tax

Income tax on the profit or loss for year comprises current and deferred taxes. Current tax is the expected amount of income taxes payable in respect of the taxable profit forthe year end is measured using the tax rates that have been enacted at the balance sheet date.

Deferred tax is provided for, using the liability method. In principle, deferred tax liabilities are recognised for all taxable temporary differences and deferred tax assets arerecognised for all deductible temporary differences, unused tax losses and unused tax credits to the extent that it is probable that taxable profit will be available againstwhich the deductible temporary differences, unused tax losses and unused tax credits can be utilised. Deferred tax is not recognised if the temporary differences arises fromgoodwill or negative goodwill or from the initial recognition of an asset or liability in a transaction which is not a business combination and at the time of the transaction,affects neither accounting profit nor taxable profit.

Deferred tax is measured at the tax rates that are expected to apply in the period when the asset is realised or the liability is settled, based on tax rates that have beenenacted or substantively enacted at the balance sheet date. Deferred tax is recognised as income or an expense and included in the profit or loss for the period, except whenit arises from a transaction which is recognised directly in equity, in which case the deferred tax is also recognised directly in equity, or when it arises from a businesscombination that is an acquisition, in which case the deferred tax is included in the resulting goodwill or the amount of any excess of the acquirer’s interest in the net fairvalue of the acquiree’s identifiable assets, liabilities and contingent liabilities over the cost of the combination.

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(o) Provisions

Provision are recognised when the Group has a present obligation as a result of a past event and it is probable that an outflow of resource embodying economic benefits willbe required to settle the obligation, and a reliable estimate of the amount can be made. Provisions are reviewed at each balance sheet date and adjusted to reflect thecurrent best estimate. Where the effect of the time value of money is material, provisions are discounted using a current pre-tax rate that reflects, where appropriate, the risksspecific to the liability. Where discounting is used, the increase in the provision due to the passage of time is recognised as finance cost.

(p) Employee benefits

(i) Short term benefits

Wages, salaries, bonuses and social security contributions are recognised as an expense in the year in which the associated services are rendered by employees. Shortterm accumulating compensated absences such as paid annual leave are recognised when services are rendered by employees that increase their entitlement to futurecompensated absences. Short term non-accumulating compensated absences such as sick leave are recognised when the absences occur.

(ii) Defined contribution plans

Defined contribution plans are post-employment benefits plans under which the Group pays fixed contributions into separate entities or funds and will have no legal orconstructive obligation to pay further contributions if any of the funds do not hold sufficient assets to pay all employee benefits relating to employee services in thecurrent and preceding financial years. Such contributions are recognised as an expense in the profit or loss as incurred. As required by law, companies in Malaysia makesuch contributions to the Employees Provident Fund (“EPF”).

(iii) Termination benefits

Termination benefits are payable when employment is terminated before the normal retirement date or whenever an employee accepts voluntary redundancy inexchange for these benefits. The Group recognises termination benefits as a liability and an expense when it is demonstrably committed to either terminate theemployment of current employees according to a detailed plan without possibility of withdrawal or providing termination benefits as a result of an offer made toencourage voluntary redundancy. In the case of an offer made to encourage voluntary redundancy, the measurement of termination benefits is based on the number ofemployee expected to accept the offer. Benefits failing due more than twelve months after balance sheet date are discounted to present value.

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(q) Foreign currencies

(i) Functional and presentation currency

The individual financial statements of each entity in the Group are measured using the currency of the primary economic environment in which the entity operates (“thefunctional currency”). The consolidated financial statements are presented in Ringgit Malaysia (“RM”), which is also the Company’s functional currency.

(ii) Foreign currency transactions

In preparing the financial statements of the individual entities, transactions in currencies other than the entity’s functional currency (“foreign currencies”) are recorded inthe functional currencies using the exchange rates prevailing on the balance sheet date. Non-monetary items carried at fair value that are denominated in foreigncurrencies are translated at the rates prevailing on the date when the fair value was determined. Non-monetary items that are measured in terms of historical cost in aforeign currency are not translated.

Exchange differences arising on the settlement of monetary items, and on the translation of monetary items, are included in profit or loss for the period except forexchange differences arising on monetary items that form part of the Group’s net investment in foreign operation. Exchange differences arising on monetary items thatform part of the Group’s net investment in foreign operation, where that monetary item is denominated in either the functional currency of the reporting entity or theforeign operation, are initially taken directly to the foreign currency translation reserve within equity until the disposal of the foreign operations, at which time they arerecognised in profit or loss. Exchange differences arising on monetary items that form part of the Group’s net investment in foreign operation, where that monetary itemis denominated in a currency other than the functional currency of either the reporting entity or the foreign operation, are recognised in profit or loss for the period.Exchange differences arising on monetary items that form part of the Company’s net investment in foreign operation, regardless of the currency of the monetary item,are recognised in profit or loss in the Company’s financial statements or the individual financial statements of the foreign operation, as appropriate.

Exchange differences arising on the translation of non-monetary items carried at fair value are included in profit or loss for the period except for the differences arisingon the translation of non-monetary items in respect of which gains and losses are recognised directly in equity. Exchange differences arising from such non-monetaryitems are also recognised directly in equity.

(iii) Foreign operations

The results and financial position of foreign operations that have a functional currency different from the presentation currency (“RM”) of the consolidated financialstatements are translated into RM as follows :

• Assets and liabilities for each balance sheet presented are translated at closing rate prevailing at the balance sheet date;

• Income and expenses for each income statement are translated at average exchange rates for the year, which approximates the exchange rates at the dates of thetransactions; and

• All resulting exchange differences are taken to the foreign currency translation reserve within equity.

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(r) 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. The following specificrecognition criteria must also be met before revenue is recognised.

(i) Construction contracts

Revenue from construction contracts is accounted for by the stage of completion method as described in Note 5(h).

(ii) Sale of properties

Revenue from sale of properties is accounted for by the stage of completion method as described in Note 5(g).

(iii) Sale of goods

Revenue is recognised net of sales taxes and upon transfer of significant risks and rewards of ownership to the buyer. Revenue is not recognised to the extent wherethere are significant uncertainties regarding recovery of the consideration due, associated costs of the possible return of goods.

(iv) Revenue from services rendered

Sale of services are recognised upon render of services to customers.

(v) Rental income

Rental income from investment property is recognised on a straight-line basis over the term of the lease. The aggregate cost of incentives provided to lessees isrecognised as a reduction of rental income over the lease term on straight-line basis.

(vi) Interest income

Interest income is recognised on an accrual basis using the effective interest method.

(vii) Dividend income

Dividend income is recognised when the Group’s right to receive payment is established.

(viii) Management fees

Management fees are recognised when services are rendered.

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(s) Non-current assets (or disposal Groups) held for sale and discontinued operation

Non-current asset (or disposal Groups) are classified as held for sale if their carrying amount will be recovered principally through a sale transaction rather than throughcontinuing use. This condition is regarded as met only when the sale is highly probable and the asset (or disposal Group) is available for immediate sale in its presentcondition subject only to terms that are usual and customary.

Immediately before classification as held for sale, the measurement of the non-current assets (or all the assets and liabilities in a disposal Group) is brought up-to-date inaccordance with applicable FRSs. Then, on initial classification as held for sale, non-current assets or disposal groups (other than investment properties, deferred tax assets,employee benefits assets, financial assets and inventories) are measured in accordance with FRS 5 that is at the lower of carrying amount and fair values less costs to sell. Anydifferences are included in profit or loss.

A component of the Group is classified as discontinued operation when the criteria to be classified as held for sale have been met or it has been disposed of and such acomponent represents a separate major line of business or geographical area of operations, is part of single co-ordinated major line of business or geographical area ofoperations or is a subsidiary acquired exclusively with a view to resale.

6. CHANGES IN ACCOUNTING POLICIES AND EFFECTS ARISING FROM ADOPTION OF NEW AND REVISED FRSs

On 1 April 2007, the Group and the Company adopted the following FRSs mandatory for financial periods beginning on or after 1 January 2007 :

FRS 117 LeasesFRS 124 Related party disclosures

The adoption of Amendment to FRS 117 and FRS 124 has not resulted in material impact on the financial statements of the Group and the Company.

The Group and the Company have not adopted FRS 6 - Exploration for and Evaluations of Mineral Resources and Amendment to FRS 1192004 - Employee Benefits - Actuarial Gainsand Losses, Group Plans and Disclosures which were effective on 1 January 2007 as they are not applicable to the Group and the Company.

The Group and the Company have not adopted the FRSs, Amendment to FRSs and Interpretations which are not effective as at 31 March 2008. The Group is still evaluating theimpact that these standards will have on the Group’s financial statements, if any, but expect that there will be no material impact when implemented.

In the previous financial year, the MASB had also issued FRS 139 Financial Instruments - Recognition and Measurement for which the MASB has yet to announce the effectivedate. The Group has not adopted FRS 139 and by virtue of the exemption in paragraph 103AB of FRS 139, the impact of applying FRS 139 on its financial statements upon firstadoption of this standard as required by paragraph 30(b) of FRS 108 Accounting Policies, Changes in Accounting Estimates and Errors is not disclosed and hence, no furtherdisclosure is warranted.

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7. SIGNIFICANT ACCOUNTING ESTIMATES AND JUDGMENTS

(a) Critical judgements made in applying accounting policies

The following are the judgements made by management in the process of applying the Group’s accounting policies that have the most significant effect on the amountsrecognised in the financial statements.

(i) Classification between investment properties and property, plant and equipment

The Group has developed certain criteria based on FRS 140 in making judgement whether a property qualifies as an investment property. Investment property is aproperty held to earn rentals or for capital appreciation or both.

Some properties comprise a portion that is held to earn rentals or for capital appreciation and another portion that is held for use in the production or supply of goodsor services or for administrative purposes. If these portions could be sold separately (or lease out separately under a finance lease), the Group would account for theportions separately. If the portions could not be sold separately, the property is an investment property only if an insignificant portion is held for use in the productionor supply of goods or services or for administrative purposes. Judgement is made on an individual property basis to determine whether ancillary services are sosignificant that a property does not qualify as investment property.

(ii) Operating lease commitments – The Group as lessor

The Group has entered into commercial property leases on its investment property portfolio. The Group has determined that it retains all the significant risks andrewards of ownership of these properties which are leased out on operating leases.

(b) Key sources of estimation uncertainty

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 materialadjustment to the carrying amounts of assets and liabilities within the next financial year are discussed below :

(i) Depreciation of equipment

The estimates for the residual values, useful lives and related depreciation charges for the equipment are based on commercial factors which could change significantlyas a result of technical innovations and competitors’ actions in response to the market conditions.

Changes in the expected level of usage and technological development could impact the economic useful lives and the residual values of the assets, therefore futuredepreciation charges could be revised.

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7 SIGNIFICANT ACCOUNTING ESTIMATES AND JUDGMENTS (Continued)

(b) Key sources of estimation uncertainty (Continued)

(ii) Impairment of development costs

Construction contracts

The Group recognised revenue based on percentage of completion method. The stage of completion is measured by reference to the contract construction costsincurred to date to the estimated total of costs. Significant judgement is required in determining the stage of completion, the extent of the contract costs incurred, theestimated total revenue and contract costs, as well as the recoverability of the construction contracts activities. Total revenue also includes an estimation of therecoverable variation works that are recoverable from the customers. In making the judgement, the Company relied on past experience and work of specialists.

Property development

The Group recognised property development revenue and expense in the income statement by using the stage of completion method. The stage of completion isdetermined by the proportion that property development costs incurred for work performed to date bear to the estimated total property development costs.

Significant judgment is required in determining the stage of completion, the extent of the property development costs incurred, the estimated total propertydevelopment revenue and costs, as well as the recoverability of the development projects. In making the judgment, the Group evaluates based on past experience andby relying on the work of specialists.

(iii) Income taxes

There are certain transactions and computations for which the ultimate tax determination may be different from the initial estimate. The Group recognizes tax liabilitiesbased on its understanding of the prevailing tax laws and estimates of whether such taxes will be due in the ordinary course of business. Where the final outcome ofthese matters is different from the amounts that were initially recognised, such difference will impact the income tax and deferred tax provisions in the period in whichsuch determination is made.

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 futuretaxable profits together with future tax planning strategies.

(iv) Impairment of assets

When the recoverable amount of an asset is determined based on the estimate of the value-in-use of the cash generating unit to which the asset is allocated, themanagement is required to make an estimate of the expected future cash flows from the cash-generating unit and also to apply a suitable discount rate in order todetermine the present value of those cash flows.

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7 SIGNIFICANT ACCOUNTING ESTIMATES AND JUDGMENTS (Continued)

(b) Key sources of estimation uncertainty (Continued)

(v) Allowance for doubtful debts of receivables

The Group makes allowance for doubtful debts based on an assessment of the recoverability of receivables. Allowances are applied to receivables where events orchanges in circumstances indicate that the carrying amounts may not be recoverable. Management specifically analyses historical bad debts, customer concentrations,customer creditworthiness, current economic trends and changes in customer payment terms when making a judgement to evaluate the adequacy of the allowance fordoubtful debts of receivables. Where the expectation is different from the original estimate, such difference will impact the carrying value of receivables.

(vi) Impairment of other investment

The management determines whether the carrying amounts of its other investments are impaired at balance sheet date. This involves measuring the recoverableamounts which includes fair value less costs to sell and valuation techniques. Valuation techniques include amongst others, discounted cash flows analysis and in somecases, based on published analysts’ reports and current market indicators and estimates that provide reasonable approximations to the computation of recoverableamounts.

75


8. PROPERTY, PLANT AND EQUIPMENT

Freehold Plant and Motor Office Furniture Officeland Buildings machinery vehicles equipment and fittings Computers Renovation Total

Group RM RM RM RM RM RM RM RM RM

As at 31.3.2008

CostAs at 1.4.2007 9,552,128 12,042,834 21,293,560 9,184,040 3,695,666 1,641,171 739,164 – 58,148,563Additions – 15,794,350 4,459,159 2,762,980 272,582 75,371 128,304 591,730 24,084,476Disposals – – (3,842,739) (1,192,124) (1,200) (7,600) – – (5,043,663)

As at 31.3.2008 9,552,128 27,837,184 21,909,980 10,754,896 3,967,048 1,708,942 867,468 591,730 77,189,376

Accumulated depreciationand impairment

As at 1.4.2007 – 203,661 16,085,452 6,915,225 2,375,456 1,000,960 393,881 – 26,974,635Depreciation charge

for the year – 23,893 1,169,848 833,386 199,827 68,304 100,688 23,709 2,419,655Disposals – – (3,140,466) (999,971) (521) (3,995) – – (4,144,953)

As at 31.3.2008 – 227,554 14,114,834 6,748,640 2,574,762 1,065,269 494,569 23,709 25,249,337

Net carrying amountAs at 31.3.2008 9,552,128 27,609,630 7,795,146 4,006,256 1,392,286 643,673 372,899 568,021 51,940,039

76


8. PROPERTY, PLANT AND EQUIPMENT (Continued)

Freehold Motor Office Furnitureland Buildings vehicles equipment and fittings Total

Company RM RM RM RM RM RM

As at 31.3.2008

CostAs at 1.4.2007 9,552,128 1,856,134 4,299,519 1,487,757 547,395 17,742,933Additions – – 2,178,175 39,898 2,900 2,220,973Disposal – – (348,531) – – (348,531)

As at 31.3.2008 9,552,128 1,856,134 6,129,163 1,527,655 550,295 19,615,375

Accumulated depreciation and impairment

As at 1.4.2007 – 203,661 3,432,288 1,059,762 421,787 5,117,498Depreciation charge for the year – 23,893 496,474 57,707 12,723 590,797Disposal – – (327,066) – – (327,066)

As at 31.3.2008 – 227,554 3,601,696 1,117,469 434,510 5,381,229

Net carrying amountAs at 31.3.2008 9,552,128 1,628,580 2,527,467 410,186 115,785 14,234,146

77



Freehold Plant and Motor Office Furniture Officeland Buildings machinery vehicles equipment and fittings Computers Renovation Total

Group RM RM RM RM RM RM RM RM RM

As at 31.3.2007

CostAs at 1.4.2006 32,627,689 348,695,824 82,045,727 9,304,624 3,905,350 17,481,548 2,649,319 – 496,710,081Additions – 10,186,700 1,564,730 910,777 230,985 76,743 261,313 565,825 13,797,073Disposals – – (1,377,490) (404,719) (44,931) – – – (1,827,140)Reclassification – – – – (186) 186 – – –Disposal of subsidiaries (23,075,561) (346,839,690) (60,939,407) – (22,714) (15,732,892) (2,114,174) – (448,724,438)Reclassified as held

for sale -Note 32 – – – (626,642) (372,838) (184,414) (57,294) (565,825) (1,807,013)

As at 31.3.2007 9,552,128 12,042,834 21,293,560 9,184,040 3,695,666 1,641,171 739,164 – 58,148,563

Accumulated depreciationand impairment

As at 1.4.2006 – 14,818,126 24,442,158 7,111,899 2,383,991 4,163,837 1,308,899 – 54,228,910Depreciation charge

for the year – 24,380 1,147,969 438,529 217,586 80,985 86,417 25,370 2,021,236Disposals – – (734,553) (348,883) (21,240) – – – (1,104,676)Reclassification – – – – (14) 14 – – –Disposal of subsidiaries – (14,638,845) (8,770,122) – (5,266) (3,198,803) (977,776) – (27,590,812)Reclassified as held

for sale -Note 32 – – – (286,320) (199,601) (45,073) (23,659) (25,370) (580,023)

As at 31.3.2007 – 203,661 16,085,452 6,915,225 2,375,456 1,000,960 393,881 – 26,974,635

Net carrying amountAs at 31.3.2007 9,552,128 11,839,173 5,208,108 2,268,815 1,320,210 640,211 345,283 – 31,173,928

78


8. PROPERTY, PLANT AND EQUIPMENT (Continued)Freehold Motor Office Furniture

land Buildings vehicles equipment and fittings TotalCompany RM RM RM RM RM RM

As at 31.3.2007

CostAs at 1.4.2006 9,552,128 1,856,134 3,912,551 1,338,524 547,395 17,206,732Additions – – 386,968 149,533 – 536,501Disposals – – – (300) – (300)

As at 31.3.2007 9,552,128 1,856,134 4,299,519 1,487,757 547,395 17,742,933

Accumulated depreciation and impairment

As at 1.4.2006 – 179,281 3,304,161 1,009,722 407,830 4,900,994Depreciation charge for the year – 24,380 128,127 50,040 13,957 216,504

As at 31.3.2007 – 203,661 3,432,288 1,059,762 421,787 5,117,498

Net carrying amountAs at 31.3.2007 9,552,128 1,652,473 867,231 427,995 125,608 12,625,435

79



Group Company31.3.2008 31.3.2007 31.3.2008 31.3.2007

RM RM RM RM(a) Details of assets under hire purchase -

Hire purchase -Plant and machinery -

Additions during the year, at cost 4,259,879 1,488,000 – –Net book value at year end 5,226,911 2,021,508 – –

Motor vehicles -Additions during the year, at cost 2,474,623 730,778 1,889,818 386,968Net book value at year end 2,730,183 1,311,989 1,892,954 380,519

Finance lease -Plant and machinery -

Net book value at year end 152,917 191,147 – –

Motor vehicles -Net book value at year end 8,465 10,581 – –

(b) The net carrying amounts of property, plant and equipment pledged as securities for borrowings (Note 23) are as follows :Group and Company

31.3.2008 31.3.2007RM RM

Freehold land 8,687,420 8,687,420Buildings 873,033 890,850

9,560,453 9,578,270

(c) No borrowing costs were capitalised during the financial year.Group and Company

31.3.2008 31.3.2007RM RM

Accumulated borrowing costs capitalised 2,188,244 2,188,244

80


9. INVESTMENT PROPERTIESGroup

31.3.2008 31.3.2007RM RM

As at 1 April 4,272,100 –Transfer from inventories – 4,272,100As at 31 March 4,272,100 4,272,100

Investment properties comprise a number of commercial properties leased to third parties as disclosed in Note 35 to the financial statements.All the investments properties are pledged as securities for borrowings as disclosed in Note 23 to the financial statements.

10. INVESTMENT IN SUBSIDIARIESCompany

31.3.2008 31.3.2007RM RM

Unquoted shares at costAs at 31 March 49,586,987 49,486,983

The particulars of the subsidiaries and companies within the Group are as follows :

Country of Holding in equityincorporation Principal activities 2008 2007

% %

Subsidiaries -

Ireka Sdn Bhd Malaysia Investment holding 100 100

Ireka iCapital Sdn Bhd (i) Malaysia Investment holding 100 100

Ireka Corporation (HK) Ltd (i) Hong Kong Structural and building construction 100 100

ICSD Ventures Sdn Bhd (i) Malaysia Property development – 60

Ireka Development Management Sdn Bhd Malaysia Property development management,provision of other related professionalservices and consultancy 100 100

i-ZEN Property Services Sdn Bhd Malaysia Property services 100 –

i-ZEN Commercial Sdn Bhd Malaysia Property investment 100 –

i-Residence Sdn Bhd Malaysia Renting out of premises 100 –

81


10. INVESTMENT IN SUBSIDIARIES (Continued)Country of Holding in equityincorporation Principal activities 2008 2007

% %

Subsidiary companies of Ireka Sdn Bhd -

Ireka Engineering & Construction Sdn Bhd Malaysia Civil, structural and building construction, earthworks and renting of construction plant and machinery 100 100

Ireka Land Sdn Bhd Malaysia Property development – 100

Regalmont (Sabah) Sdn Bhd Malaysia Property development 100 100

i-Residence Sdn Bhd Malaysia Dormant – 100

Regal Variety Sdn Bhd Malaysia Dormant 100 100

Iswaja Enterprise Sdn Bhd Malaysia Dormant 100 100

i-ZEN Hospitality Sdn Bhd Malaysia Property management, provision of other related professional services and consultancy 100 100

Unique Legacy Sdn Bhd (i) Malaysia Dormant 90 90

Legolas Capital Sdn Bhd (i) Malaysia Project and finance management and supervisory services 85.1 85.1

Subsidiary company of Iswaja Enterprise Sdn Bhd -Awarni Sdn Bhd (i) (ii) Malaysia Dormant 100 100

Subsidiary company of IrekaEngineering & Construction Sdn Bhd -United Time Development Sdn Bhd (i) Malaysia Property development 100 –

82


10. INVESTMENT IN SUBSIDIARIES (Continued)Country of Holding in equityincorporation Principal activities 2008 2007

% %

Subsidiary companies ofIreka iCapital Sdn Bhd -e-Auction Sdn Bhd (i) Malaysia Trading and rental of industrial and construction equipment 96 96

Ireka Venture Capital Ltd (i) British Investment holding and provision of Virgin Islands venture capital fund to internet, e-commerce and

related technology based companies 100 100

asiaegolf Tours Sdn Bhd (i) Malaysia Providing golf related services for international or overseas golf tour parties, business golfing and to individual golfer on the internet 100 100

i-Tech Network Solutions Sdn Bhd (i) Malaysia Providing system integration, software solution and trading in computer hardware 100 100

Associated companies of ICSD Ventures Sdn Bhd -Sandakan Harbour Square Sdn Bhd (i) Malaysia Property development – 49

(i) The financial statements of these companies are not audited by Raja Salleh, Lim & Co.(ii) This Company is currently under members’ voluntary liquidation.

83


11. INVESTMENT IN JOINTLY CONTROLLED ENTITIESGroup Company

31.3.2008 31.3.2007 31.3.2008 31.3.2007RM RM RM RM

Capital contribution 140,000 140,000 70,000 70,000Share of post-acquisition reserves 42,959 89,733 – –

182,959 229,733 70,000 70,000Details of the jointly controlled entities are as follows :

Group Company31.3.2008 31.3.2007 31.3.2008 31.3.2007

Jointly Principal Proportion of ownership interestcontrolled entities activities % % % %

(a) Ireka-Uspa Joint Venture (i) (ii) Construction of passage including pipe-jacking, bridge and culvert in Gombak 70 70 70 70

(b) Ireka-Sara Timur Joint Venture (iii) Construction of a sewerage treatment plant at Kincimount Lagoon, Luyang, Kota Kinabalu 70 70 – –

(i) There are no contingencies and commitments relating to the Group’s interest in the jointly controlled entities.

(ii) The financial year end is 31 December 2007.

(iii) The financial year end is 31 March 2008.

The Group’s aggregate share of the current assets, non-current assets, current liabilities, non-current liabilities, income and expenses of the jointly controlled entities are asfollows :

31.3.2008 31.3.2007RM RM

Assets and liabilitiesCurrent assets 7,556,438 8,033,757Non-current assets 14,997 16,823Total assets 7,571,435 8,050,580

Current liabilities (7,387,476) (7,820,847)Total liabilities (7,387,476) (7,820,847)

ResultsExpenses, including finance costs and taxation (52,853) (15,082)

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12. OTHER INVESTMENTSGroup Company

31.3.2008 31.3.2007 31.3.2008 31.3.2007RM RM RM RM

At costQuoted shares - Outside Malaysia 148,308,200 – 148,308,200 –Transferable corporate membership 601,900 601,900 601,900 601,900Unquoted shares 1,050,948 1,139,526 – –Subordinated bond 2002/2007 2,600,000 4,000,000 2,600,000 4,000,000Carrying amount 152,561,048 5,741,426 151,510,100 4,601,900Accumulated impairment loss (2,200,000) – (2,200,000) –

150,361,048 5,741,426 149,310,100 4,601,900

Market value of quoted shares - Outside Malaysia 125,102,480 – 125,102,480 –

13. LAND HELD FOR PROPERTY DEVELOPMENT31.3.2008 31.3.2007

RM RMAs at 31 March 2008Freehold land, at cost Addition 10,809,340 –

14. PROPERTY DEVELOPMENT COSTSFreehold Development Borrowing costs

land costs capitalised TotalGroup RM RM RM RM

As at 31 March 2008

Cumulative property development costsAs at 1 April 2007 5,499,597 44,554,842 2,226,039 52,280,478Costs incurred during the year 693,871 3,847,196 4,040 4,545,107Transfer during the year (1,649,696) – – (1,649,696)As at 31 March 2008 4,543,772 48,402,038 2,230,079 55,175,889

Cumulative costs recognised in income statementAs at 1 April 2007 (43,541,782)Recognised during the year (6,119,593)As at 31 March 2008 (49,661,375)Property development costs as at 31 March 2008 5,514,514

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14. PROPERTY DEVELOPMENT COSTS (Continued)Borrowing

Freehold Development costsland costs capitalised Total

Group RM RM RM RMAs at 31 March 2007

Cumulative property development costsAs at 1 April 2006 30,669,767 267,059,474 26,136,206 323,865,447Costs incurred during the year 18,553,057 100,570,724 9,985,419 129,109,200Transfer from land held for property development 41,840,248 19,654,929 8,096,797 69,591,974Reversal of completed projects (15,581,465) (184,197,070) (18,623,166) (218,401,701)Reclassified as held for sale (69,982,010) (158,533,215) (23,369,217) (251,884,442)As at 31 March 2007 5,499,597 44,554,842 2,226,039 52,280,478

Cumulative costs recognised in income statementAs at 1 April 2006 239,368,117Recognised during the year 128,197,777Reversal of completed projects (216,144,111)Unsold units transferred to inventories (834,590)Reclassified as held for sale (107,045,411)As at 31 March 2007 43,541,782Property development costs as at 31 March 2007 8,738,696

15. INVENTORIESGroup

31.3.2008 31.3.2007RM RM

CostProperties held for sale 955,000 1,423,000Construction materials 11,025,767 7,353,477Finished goods 1,548,230 564,423

13,528,997 9,340,900

86


16. TRADE AND OTHER RECEIVABLESGroup Company

31.3.2008 31.3.2007 31.3.2008 31.3.2007RM RM RM RM

Trade receivables 139,915,904 73,924,218 9,670,504 13,464,645Accrued billings in respect of property development 100,000 952,770 – –

140,015,904 74,876,988 9,670,504 13,464,645Less : Allowance for doubtful debts (43,450) (280,611) – –Trade receivables, net 139,972,454 74,596,377 9,670,504 13,464,645

Other receivablesDeposits 473,999 316,828 78,958 88,588Prepayments 4,596,713 3,816,593 2,683,418 2,770,434Other receivables 37,921,444 27,171,394 31,564,860 3,179,253

42,992,156 31,304,815 34,327,236 6,038,275182,964,610 105,901,192 43,997,740 19,502,920

17. AMOUNTS DUE FROM CUSTOMERS ON CONTRACTSGroup Company

31.3.2008 31.3.2007 31.3.2008 31.3.2007RM RM RM RM

Construction contract costs incurred to date 759,315,523 751,530,376 139,601,740 139,601,740Attributable profits 71,423,907 56,196,364 14,807,179 14,807,179Less : Provision for foreseeable losses (18,954,530) (1,300,000) (18,954,530) (1,300,000)

811,784,900 806,426,740 135,454,389 153,108,919Less : Progress billings (796,279,410) (747,203,156) (135,454,389) (135,454,389)Amounts due from customers on contracts 15,505,490 59,223,584 – 17,654,530

Retention sums on contracts included within trade receivables 37,536,435 18,857,626 – –

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17. AMOUNTS DUE FROM CUSTOMERS ON CONTRACTS (Continued)

The costs incurred to date on construction contracts include the following charges made during the financial year :Group Company

31.3.2008 31.3.2007 31.3.2008 31.3.2007RM RM RM RM

Hire of plant and machinery 5,944,912 4,597,149 – –Property, plant and equipment depreciation 1,167,580 1,146,078 – –Rental expense for buildings 437,333 414,359 – –

18. AMOUNTS DUE FROM JOINTLY CONTROLLED ENTITIESGroup Company

31.3.2008 31.3.2007 31.3.2008 31.3.2007RM RM RM RM

Amounts due from jointly controlled entities 13,696,709 13,485,298 13,378,497 13,174,341Less : Allowance for doubtful debts (2,300,777) (1,849,865) (1,849,865) (1,849,865)

11,395,932 11,635,433 11,528,632 11,324,476

The amounts due from jointly controlled entities are unsecured, have no fixed terms of repayment and non-interest bearing.

19. AMOUNTS DUE FROM OR TO SUBSIDIARIES

The amounts due from or to subsidiary companies are unsecured, have no fixed terms of repayment and interest-free.

20. CASH AND CASH EQUIVALENTSGroup Company

31.3.2008 31.3.2007 31.3.2008 31.3.2007RM RM RM RM

Cash on hand and at banks 44,651,426 7,007,872 2,028,089 27,553Deposits with licensed banks 28,904,039 66,402,073 3,089,260 –Cash and bank balances 73,555,465 73,409,945 5,117,349 27,553Bank overdraft (20,108,321) (22,922,226) (178,854) (894,585)Cash and bank balances classified as held for sale - Note 32 3,553 6,416,226 – –Total cash and cash equivalents 53,450,697 56,903,945 4,938,495 (867,032)

88


20. CASH AND CASH EQUIVALENTS (Continued)

(i) Included in cash at banks of the Group are amounts of RM1,480,128 (31.3.2007 - RM2,898,976) held pursuant to Section 8A of the Housing (Control and Licensing ofDevelopers) Enactment, 1978 and restricted from use in the other operations.

21. SHARE CAPITAL AND SHARE PREMIUMNumber of ordinary shares of RM1 each Share Total share

Share capital premium capital and(Issued and fully paid) share premium

RM RM RM

As at 1 April 2006 113,914,700 21,937,906 135,852,606Transaction costs – (14,000) (14,000)As at 31 March 2007 and 1 April 2007 113,914,700 21,923,906 135,838,606Transaction costs – (32,321) (32,321)As at 31 March 2008 113,914,700 21,891,585 135,806,285

Number of ordinary shares of RM1 each Amount

31.3.2008 31.3.2007 31.3.2008 31.3.2007RM RM RM RM

Authorised share capital as at 31 March 500,000,000 500,000,000 500,000,000 500,000,000

The holders of ordinary shares are entitled to receive dividends as declared from time to time and are entitled to one vote per share at meetings of the Company. All ordinaryshares rank equally with regard to the Company’s residual assets.

The Company did not purchase or re-sell any of its own shares during the financial year ended 31 March 2008.

22. OTHER RESERVESGroup

31.3.2008 31.3.2007RM RM

Foreign currency translation reserve As at 1 April 184,609 57,097Foreign currency translation – 127,512As at 31 March 184,609 184,609

89


23. BORROWINGSGroup Company

31.3.2008 31.3.2007 31.3.2008 31.3.2007RM RM RM RM

Short term borrowings

Secured :Bridging loans – 29,039,850 – –Revolving credits – 14,630,481 – –Term loans 1,100,862 1,202,701 75,210 571,630Hire purchase and finance lease liabilities 2,050,029 845,469 407,834 82,060

3,150,891 45,718,501 483,044 653,690Unsecured :Bank overdrafts 20,108,321 22,922,226 178,854 894,585Collateralised loan obligation – 41,087,122 – 41,087,122Revolving credits 19,381,694 6,852,261 4,009,797 3,035,636Trade finance 43,662,000 16,713,000 – –

83,152,015 87,574,609 4,188,651 45,017,34386,302,906 133,293,110 4,671,695 45,671,033

Long term borrowings

Secured :Term loans 10,386,549 1,487,021 1,412,201 1,487,021Hire purchase and finance lease liabilities 4,938,941 1,293,204 1,416,249 307,990

15,325,490 2,780,225 2,828,450 1,795,011Unsecured :Revolving credits 16,000,000 24,725,889 – –

31,325,490 27,506,114 2,828,450 1,795,011Total borrowings

Bridging loans – 29,039,850 – –Collateralised loan obligation – 41,087,122 – 41,087,122Revolving credits 35,381,694 46,208,631 4,009,797 3,035,636Trade finance 43,662,000 16,713,000 – –Term loans 11,487,411 2,689,722 1,487,411 2,058,651Bank overdrafts 20,108,321 22,922,226 178,854 894,585Hire purchase and finance lease liabilities 6,988,970 2,138,673 1,824,083 390,050

117,628,396 160,799,224 7,500,145 47,466,044

90


23. BORROWINGS (Continued)

The term loans are secured by the following :

(a) First legal charge over the freehold land, leasehold land and buildings of the Company and certain subsidiaries as disclosed in Note 8(b) and Note 9.

(b) Corporate guarantee by the Company and certain subsidiaries.

The secured bridging loans and revolving credit are secured by assignment of contract proceeds and corporate guarantee of the Company.

Other information on financial risks of borrowings are disclosed in Note 39.

Hire purchase and finance lease liabilitiesGroup Company

31.3.2008 31.3.2007 31.3.2008 31.3.2007RM RM RM RM

Future minimum lease paymentsNot later than 1 year 2,459,322 971,984 479,524 91,461Later than 1 year and not later than 2 years 1,822,598 786,370 478,715 85,788Later than 2 years and not later than 5 years 3,731,543 673,558 1,069,059 257,314Total future minimum lease payments 8,013,463 2,431,912 2,027,298 434,563Less : Future finance charges (1,024,493) (293,239) (203,215) (44,513)Present value of finance lease liabilities 6,988,970 2,138,673 1,824,083 390,050

Analysis of present value of finance lease liabilitiesNot later than 1 year 2,050,029 845,469 407,834 82,060Later than 1 year and not later than 2 years 1,613,520 692,424 426,104 77,010Later than 2 years and not later than 5 years 3,325,421 600,780 990,145 230,980

6,988,970 2,138,673 1,824,083 390,050Less : Amount due within 12 months (2,050,029) (845,469) (407,834) (82,060)Amount due after 12 months 4,938,941 1,293,204 1,416,249 307,990

The Group has finance lease and hire purchase contracts for various items of property, plant and equipment as disclosed in Note 8. These leases have terms of renewal but nopurchase options and escalation clauses. Renewals are at the option of the specific entity that holds the lease. There are no restrictions placed upon the Group by entering intothese leases and no arrangements have been entered into for contingent rental payments.

Other information on financial risks of hire purchase and finance lease liabilities are disclosed in Note 39.

91


24. DEFERRED TAXGroup Company

31.3.2008 31.3.2007 31.3.2008 31.3.2007RM RM RM RM

As at 1 April 3,197,014 3,285,070 610,000 610,000Recognised in income statement 25,486 (30,105) – –Reclassified as held for sale – (57,951) – –As at 31 March 3,222,500 3,197,014 610,000 610,000

Presented after appropriate offsetting as follows :Deferred tax assets – (73,974) – –Deferred tax liabilities subject to income tax 3,222,500 3,270,988 610,000 610,000

3,222,500 3,197,014 610,000 610,000

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

Deferred tax liabilities of the GroupGroup Company

31.3.2008 31.3.2007 31.3.2008 31.3.2007RM RM RM RM

Property, plant and equipment As at 1 April 3,270,988 27,649,721 610,000 610,000Recognised in income statement (48,488) 27,288 – –Reclassified as held for sale – (57,951) – –Disposal of subsidiary – (24,348,070) – –As at 31 March 3,222,500 3,270,988 610,000 610,000

Deferred tax assets of the Group :Unused tax losses

and unabsorbedcapital

Provisions Others allowances TotalRM RM RM RM

As at 1 April 2006 4,415 12,166 24,348,070 24,364,651Recognised in income statement 2,137 55,256 – 57,393Disposal of subsidiary – – (24,348,070) (24,348,070)As at 31 March 2007 6,552 67,422 – 73,974Recognised in income statement (6,552) (67,422) – (73,974)As at 31 March 2008 – – – –

92


24. DEFERRED TAX (Continued)

Deferred tax assets have not been recognised in respect of the following items :Group Company

31.3.2008 31.3.2007 31.3.2008 31.3.2007RM RM RM RM

Unused tax losses 73,199,158 47,563,126 4,363,423 2,070,625Unabsorbed capital allowances 6,569,599 2,480,258 490,689 270,199

79,768,757 50,043,384 4,854,112 2,340,824

The availability of the unused tax losses and unabsorbed capital allowances for offsetting against future taxable profits of the respective subsidiaries are subject to no substantialchanges in shareholdings of those subsidiaries under Income Tax Act, 1967 and guidelines issued by the tax authority.

Deferred tax assets have not been recognised where it is not probable that future taxable profits will be available against which the subsidiaries can utilise the benefits.

25. TRADE AND OTHER PAYABLES

Group Company31.3.2008 31.3.2007 31.3.2008 31.3.2007

RM RM RM RMCurrentTrade payables (i) 124,361,899 96,927,106 202,881 1,154,719Progress billings in respect of property development cost 252,069 473,904 – –

124,613,968 97,401,010 202,881 1,154,719

Other payablesAccruals 2,290,494 7,742,722 – –Other payables 30,217,125 3,728,375 1,144,286 1,227,096Trade deposits 54,750 57,160 – –

32,562,369 11,528,257 1,144,286 1,227,096157,176,337 108,929,267 1,347,167 2,381,815

(i) Trade payables are non-interest bearing and the normal trade credit terms granted to the Group range from one month to three months.

93


26. REVENUEGroup Company

31.3.2008 31.3.2007 31.3.2008 31.3.2007RM RM RM RM

Construction contracts 257,598,797 165,302,020 – –Property development 6,826,419 9,261,145 – –Trading and services 33,887,629 10,286,441 – –Rental income 787,769 – – –Hospitality and leisure 625,837 715,725 – –Management fees from subsidiaries – – 10,900,784 7,204,800Interest income – 976,252 – –

299,726,451 186,541,583 10,900,784 7,204,800

27. COST OF SALESGroup Company

31.3.2008 31.3.2007 31.3.2008 31.3.2007RM RM RM RM

Construction contracts costs 291,137,116 179,860,646 21,063,498 1,906,575Property development costs 6,119,593 18,723,936 – –Cost of inventories sold 15,997,757 8,282,774 – –Cost of services rendered 457,829 438,462 – –

313,712,295 207,305,818 21,063,498 1,906,575

28. OTHER INCOMEGroup Company

31.3.2008 31.3.2007 31.3.2008 31.3.2007RM RM RM RM

Gain on sales of property, plant and equipment 1,534,957 1,234,401 9,608 794,834Interest received – 124,632 1,021,435 2,400Gain on foreign exchange - realised – 685,845 – –Rental income – 5,270 – –Rental of motor vehicle recoverable 201,376 61,223 58,027 61,223Gain on disposal of subsidiaries 205,648,677 29,908,950 65,837,572 –Other 859,415 1,495,184 43,005 155,411

208,244,425 33,515,505 66,969,647 1,013,868

94


29. FINANCE COSTSGroup Company

31.3.2008 31.3.2007 31.3.2008 31.3.2007RM RM RM RM

Interest expense on :Bank borrowings 5,377,264 14,379,708 2,380,920 3,906,898Hire purchase and finance lease liabilities 388,517 181,250 53,742 22,190Total interest expense carried forward 5,765,781 14,560,958 2,434,662 3,929,088Less : Interest expense capitalised in qualifying assets – (352,849) – –

5,765,781 14,208,109 2,434,662 3,929,088

30. PROFIT/(LOSS) BEFORE TAX

The following amounts have been included in arriving at profit/(loss) before tax :Group Company

31.3.2008 31.3.2007 31.3.2008 31.3.2007RM RM RM RM

After charging :Allowance for doubtful debts – 237,161 – –Auditors’ remuneration

- Current year 254,325 234,734 94,500 94,500- Under/(Over)provision in prior years 47,828 (3,580) – –

Bad debts written off – 676,000 – 676,000Directors’ remuneration

- Fee 368,000 278,000 350,000 260,000- Emoluments 4,270,310 2,884,335 3,300,000 2,080,860- Others 570,315 210,131 570,315 210,131

Impairment/Amortisation of goodwill – 12,579,358 – –Loss on foreign exchange

- Realised 596,386 – – –Other investments

- Impairment loss 2,200,000 – 2,200,000 –Preliminary expenses 5,400 – – –Property, plant and equipment

- Depreciation 2,419,655 2,021,236 590,797 216,504- Loss on disposals 101,819 15,165 273 –- Written off – 2,512 – –

Provision for foreseeable loss 100,000 – – –

95


30. PROFIT/(LOSS) BEFORE TAX (Continued)

Group Company31.3.2008 31.3.2007 31.3.2008 31.3.2007

RM RM RM RM

Rental of- Plant and machinery 5,944,912 4,597,149 – –- Land and buildings 1,361,661 617,812 187,272 187,272- Office equipment 1,113,167 120,151 124,136 120,151- Motor vehicle 12,507 – – –

Staff cost (i) 26,615,116 22,732,740 3,585,798 3,454,512Write back of allowance for doubtful debts (183,303) – – –

(i) Staff costsGroup Company

31.3.2008 31.3.2007 31.3.2008 31.3.2007RM RM RM RM

Wages, salaries and other 23,811,301 20,429,967 2,956,443 2,947,133Employees’ Provident Fund 2,803,815 2,302,773 629,355 507,379

26,615,116 22,732,740 3,585,798 3,454,512

96


31. INCOME TAX EXPENSEGroup

31.3.2008 31.3.2007RM RM

Continuing operationsCurrent income tax

Malaysian income tax 3,028,128 324,790Under/(Over)provision in prior years

Malaysian income tax 3,551,194 (1,938,412)6,579,322 (1,613,622)

Deferred taxRelating to origination and reversal of differences 25,486 (29,704)

Total income tax expense from continuing operations 6,604,808 (1,643,326)

Discontinued operations

Current income tax Malaysian income tax 451,942 2,724,772

Total income tax expense 7,056,750 1,081,446

Domestic current income tax is calculated at the statutory tax rate of 26% (31.3.2007 - 27%) of the estimated assessable profit for the year. The domestic statutory tax rate will bereduced to 25% from the current year’s rate of 26%, effective Year of Assessment 2009. The computation of deferred tax as at 31 March 2008 has reflected these changes.

97


31. INCOME TAX EXPENSE (Continued)

A reconciliation of income tax expense applicable to profit/(loss) before taxation at the statutory income tax rate to income tax expenses at the effective income tax rate of theGroup and of the Company is as follows :

Group31.3.2008 31.3.2007

RM RMProfit/(Loss) before tax from :

Continuing operations 158,357,347 (36,200,911)Discontinued operations - Note 32 1,562,725 3,999,137

159,920,072 (32,201,774)

Taxation at Malaysian statutory tax rate of 26% (31.3.2007 - 27%) 41,579,219 (8,694,479)

Income not subject to tax (46,340,129) (185,178)Expenses not deductible for tax purposes 110,367 30,156Change in tax rate – 1,068Effect of differential in tax rates from changes – (70,000)Deferred tax assets not recognised in respect of current

year’s tax losses and unabsorbed capital allowances 8,272,498 11,938,291Under/(Over)provision of tax expenses in prior years 3,551,194 (1,938,412)Utilisation of previously unrecognised tax losses

and unabsorbed capital allowances (100,681) –Other (15,718) –Income tax expense for the year 7,056,750 1,081,446

Company31.3.2008 31.3.2007

RM RM

Profit/(Loss) before tax 39,387,288 (7,716,499)

Taxation at Malaysian statutory tax rate of 26% 10,240,695 (2,083,455)(31.3.2007 - 27%)

Income not subject to tax (10,240,695) –Deferred tax assets not recognised in respect of current year’s tax losses – 2,083,455Income tax expense for the year – –

Group and Company31.3.2008 31.3.2007

RM RMTax savings during the financial year arising from :

Utilisation of current year tax losses 579,555 2,400

98


32. DISCONTINUED OPERATION AND DISPOSAL GROUP CLASSIFIED AS HELD FOR SALE

On 30 November 2007, the Company announced the disposal of its wholly-owned subsidiary, Ireka Land Sdn Bhd and its 60% owned subsidiary ICSD Ventures Sdn Bhd to AseanaProperties Limited. The transaction was completed on 15 May 2008.

The cash flow resulting from the disposal is as follows :Group

31.3.2008 31.3.2007RM RM

Property, plant and equipment 1,215,968 421,133,626Land held for property development 78,125,758 –Property development cost 141,872,915 –Inventories 7,375,294 2,801,822Trade and other receivables 36,112,620 18,825,659Cash and bank balances 6,416,226 1,090,963Borrowings (202,702,015) (243,953,480)Deferred tax (57,951) –Trade and other payables (27,111,368) (16,311,215)Current tax payable (7,255,711) –

Net assets disposed 33,991,736 183,587,375Total disposal proceeds (239,640,413) (213,496,325)

Gain on disposal to the Group - Note 28 (205,648,677) (29,908,950)

Cash inflow arising on disposal :Cash consideration 239,640,413 213,496,325Cash and cash equivalents of subsidiaries disposed (6,416,226) (1,090,963)

233,224,187 212,405,362

As part of the above transaction to dispose off Ireka Land Sdn Bhd and ICSD Ventures, it was also intended that Legolas Capital Sdn Bhd be disposed off to Aseana PropertiesLimited. The proposed disposal is still pending the approval of Foreign Investment Committee.

As at 31 March 2008, the results of Ireka Land Sdn Bhd, ICSD Ventures Sdn Bhd and Legolas Capital Sdn Bhd have been presented on the consolidated income statement asdiscontinued operations.

99


32. DISCONTINUED OPERATION AND DISPOSAL GROUP CLASSIFIED AS HELD FOR SALE (Continued)

The analysis of the results of discontinued operations and the result recognised on the remeasurement of assets of disposal group is follows :Group

31.3.2008 31.3.2007RM RM

Revenue 20,369,363 99,199,372Cost of sales (18,576,801) (87,198,645)

Gross profit 1,792,562 12,000,727Other income 7,291,745 1,190,039Administration expenses (110,882) (2,896,309)Other expenses (225,483) (6,279,598)

Profit from operations 8,747,942 4,014,859Finance costs (7,185,217) (15,722)

Profit before tax of discontinued operations 1,562,725 3,999,137Income tax expense (451,942) (2,724,772)

Profit for the year from discontinued operations 1,110,783 1,274,365

The following amounts have been included in arriving at profit before tax of discontinued operations :

Group31.3.2008 31.3.2007

RM RM

Auditors’ remuneration - Statutory audit 6,000 106,250Interest expenses 7,185,217 15,722Interest income (7,219,195) (446,218)Property, plant and equipment - Depreciation 11,105 116,509Rental income (43,550) –Rental of plant and machinery 48,675 15,479

100



The cash flow attributable to the discontinued operations are as follows :Group

31.3.2008 31.3.2007RM RM

Operating cash flows (3,306,900) 10,651,863Investing cash flows (93,691,914) (14,019,070)Financing cash flows 97,000,013 1,278,643Total cash flows 1,199 (2,088,564)

The major classes of assets and liabilities of Legolas Capital Sdn Bhd and Sandakan Harbour Square Sdn Bhd classified as held for sale on the consolidated balance sheet as at 31March 2008 are as follows :

Carrying amounts as at31.3.2008 31.3.2007

RM RMAssetsAmount due from associated company – 799,306Property, plant and equipment - Note 8 – 1,226,990Land held for property development – 77,137,380Property development costs – 144,839,031Inventories – 8,189,679Trade and other receivables 3,785,018 18,133,352Cash and bank balances - Note 20 3,553 6,416,226Advances to joint venture 112,000,000 –Assets of disposal group classified as held for sale 115,788,571 256,741,964

LiabilitiesTrade and other payables 3,804,555 25,245,814Borrowings – 163,476,837Current tax payable – 7,408,861Deferred tax - Note 24 – 57,951Medium term notes 112,000,000 –Non-convertible redeemable preference share 1 –Liabilities directly associated with assets classified as held for sale 115,804,556 196,189,463

101



The non-current asset classified as held for sale on the Company’s balance sheet as at 31 March 2008 is as follows :Carrying amounts as at

31.3.2008 31.3.2007RM RM

AssetInvestment in associates 6 –Investment in subsidiary – 4,350,000

Name of Country of Principal Proportion of Proportion ofAssociates incorporation activities ownership interest voting power

31.3.2008 31.3.2007 31.3.2008 31.3.2007% % % %

SandakanHarbour Square PropertySdn Bhd Malaysia development 29.4 – 29.4 –

33. EARNING PER SHARE

Profit per share is calculated by dividing profit for the year attributable to ordinary equity holders of the Company by the weighted average number of ordinary shares in issueduring the financial year, excluding treasury shares held by the Company.

31.3.2008 31.3.2007RM RM

Profit/(Loss) from continuing operations attributable to ordinary equity holders of the Company 151,753,932 (34,991,071)Profit from discontinued operations attributable to ordinary equity holders of the Company 1,110,783 1,274,365Profit/(Loss) attributable to ordinary equity holders of the Company 152,864,715 (33,716,706)

Basic earnings per share amounts are calculated by dividing profit for the year attributable to ordinary equity holders of the Company by the weighted average number ofordinary shares in issue during the financial year, excluding treasury shares held by the Company.

31.3.2008 31.3.2007RM RM

Weighted average number of ordinary shares in issue 113,914,700 113,914,700

Basic earnings per share for :Profit/(Loss) from continuing operations 133.21 (30.72)Profit from discontinued operations 0.98 1.12Profit/(Loss) for the year 134.19 (29.60)

102


34. DIVIDENDSDividends

Dividends in respect of Year recognised in Year31.3.2008 31.3.2007 31.3.2006 31.3.2008 31.3.2007

RM RM RM RM RMRecognised during the year :Interim dividend of 10.0% per share, less 27% income tax 8,315,773 – – 8,315,773 –

Interim dividend of 8.8% per share comprising tax-exempt dividend of 4.0% and 4.8% less 27% income tax – 8,548,159 – – 8,548,159

Final dividend of 3.0% per share less 28% income tax for year ended 2006 – – 2,460,558 – –

8,315,773 8,548,159 2,460,558 8,315,773 8,548,159

35. OPERATING LEASE ARRANGEMENTS

The Group has entered into operating lease agreements on its investment property portfolio. These leases have remaining lease terms of between 1 to 5 years. All leases include aclause to enable upward revision of the rental charge on an annual basis based on prevailing market conditions and certain contracts include contingent rental arrangementscomputed based on sales achieved by tenants.

The future minimum lease payments receivable under operating leases contracted for as at the balance sheet date but not recognised as receivable, are as follows :

31.3.2008 31.3.2007RM RM

Not later than 1 year 42,286 42,286Later than 1 year and not later than 5 years 169,144 211,430

211,430 253,716

Investment property rental income including contingent rent are recognised in profit or loss during the financial year as disclosed in Note 26 to the financial statements.

103


36. RELATED PARTY DISCLOSURESGroup

31.3.2008 31.3.2007RM RM

Companies in which certain Directors are deemed to have interests :

Building materials and spare parts purchased from- Binaderas Sdn Bhd 3,990,211 –- Imuda Sdn Bhd 90,475 –- Quality Parts Sdn Bhd 808,169 986,253

Consultant fees charged by- Amatir Resources Sdn Bhd 92,609 –- Binaderas Sdn Bhd 15,435 –

Purchase of properties from- Ireka Land Sdn Bhd 15,794,350 –

Progress billings on contracts to/(from)- Amatir Resources Sdn Bhd (41,632,639) (262,346)- Binaderas Sdn Bhd (82,834,834) (99,030,352)- Inovtecs Sdn Bhd 125,760 –- Ireka Land Sdn Bhd (171,751,044) –- Inovtecs Sdn Bhd (125,007) (263,553)

Rental of machinery charged by/(to)- Binaderas Sdn Bhd (54,133) –- Ifonda Sdn Bhd (42,893) 33,583- Imuda Sdn Bhd 82,732 390,700- Imuda Sdn Bhd (298,791) (122,265)- Inovtecs Sdn Bhd – (19,910)

Rental of motor vehicle charged to- Imuda Sdn Bhd (22,543) (53,549)

Sales of development properties to Directors – (1,913,707)

104


36. RELATED PARTY DISCLOSURES (Continued)Group

31.3.2008 31.3.2007RM RM

Companies in which certain Directors are deemed to have interests : (Continued)

Sales of general plant- Imuda Sdn Bhd (113,000) –

Supply of diesel to- Amatir Resources Sdn Bhd (129,409) –- Imuda Sdn Bhd (39,625) –

Supply of labour (to)/from- Imuda Sdn Bhd (70,564) (309,165)- Imuda Sdn Bhd 377,150 253,172- Inovtecs Sdn Bhd – (730)

Supply of transport to- Imuda Sdn Bhd (16,793) –

Subsidiary companies :

Entertainment – 150Interest received (510,370) (2,400)Management fee (10,900,784) (7,202,800)Office equipment maintenance fees – 52,500Purchase of office equipment – 8,857Rental of office equipment – 31,855

105


36. RELATED PARTY DISCLOSURES (Continued)

Outstanding balances arising from trade transactions during the financial year are as follows :

Group31.3.2008 31.3.2007

RM RM

Included in trade receivables :Amatir Resources Sdn Bhd 4,033,772 –Binaderas Sdn Bhd 8,613,523 11,247,900Imuda Sdn Bhd 2,483,918 2,252,247Inovtecs Sdn Bhd 1,727,072 1,179,208Ireka Land Sdn Bhd 43,626,956 –

60,485,241 14,679,355Included in trade payables :

Ifonda Sdn Bhd 469,280 461,989Ireka Land Sdn Bhd 20,382,845 –Quality Parts Sdn Bhd 372,683 1,530,981

21,224,808 1,992,970

The Directors are in the opinion that all the transactions above have been entered into in the normal course of business and have been established on terms and conditions thatare not materially different from that obtainable in transactions with unrelated parties.

Included in the total key management personnel are :Group Company

31.3.2008 31.3.2007 31.3.2008 31.3.2007RM RM RM RM

Directors’ remuneration - Note 30 5,208,625 3,372,466 4,220,315 2,550,991

106


37. CONTINGENT LIABILITIES

Group Company31.3.2008 31.3.2007 31.3.2008 31.3.2007

Unsecured - RM RM RM RM

(a) Corporate guarantees for creditfacilities granted to suppliers. – – 9,134,364 8,527,729

(b) Corporate guarantees for creditfacilities. 136,362,915 24,638,980 353,146,525 254,161,956

(c) Letters of undertaking for utilisedcredit facilities. – 721,800 – 721,800

(d) Additional Notices of Assessmentissued by the Inland Revenue Board(IRB) in respect of Y/A 1990 to Y/A 1998.No provision has been made in thefinancial statements as the Directors,supported by the tax consultants, areof the opinion that the Company willnot be liable. 3,193,581 3,193,581 3,193,581 3,193,581

107


38. SEGMENTAL INFORMATION

Primary Reporting - Business segments

Continuing operations Discontinuedoperations

Trading HospitalityProperty and and Investment

Construction development services leisure holding Elimination Total Total31.3.2008 RM RM RM RM RM RM RM RM RM

RevenueExternal sales 257,598,797 6,826,419 33,887,629 625,837 787,769 – 299,726,451 20,369,363 320,095,814Inter-segment sales – – 2,637,185 – 10,900,784 (13,537,969) – – –Total revenue 257,598,797 6,826,419 36,524,814 625,837 11,688,553 (13,537,969) 299,726,451 20,369,363 320,095,814

ResultSegment result (21,866,222) 418,334 6,348,624 (136,892) 182,997,423 (7,536,939) 160,224,328 1,456,197 161,680,525Finance costs (5,765,781) (7,185,217) (12,950,998)Other income 3,945,574 7,291,745 11,237,319Share of net loss of

jointly controlledentities (46,774) (46,774) – (46,774)

Profit before tax 158,357,347 1,562,725 159,920,072Income tax expense (6,604,808) (451,942) (7,056,750)Profit for the year 151,752,539 1,110,783 152,863,322

108


38. SEGMENTAL INFORMATION (Continued)

Primary Reporting - Other information




Other informationSegment assets 202,863,741 20,797,464 23,438,146 235,896 272,322,006 190,282 519,847,535 115,788,571 635,636,106Investment in jointly

controlled entities 182,959 – 182,959Consolidated total

assets 520,030,494 115,788,571 635,819,065

Segment liabilities 230,858,207 11,471,727 4,941,095 86,669 36,130,788 – 283,488,486 115,804,556 399,293,042Consolidated totalliabilities 283,488,486 115,804,556 399,293,042

Capital expenditure 5,051,829 – 1,009,486 3,879 18,019,282 24,084,476 – 24,084,476Depreciation 1,611,031 29,407 164,157 8,468 606,592 2,419,655 11,105 2,430,760Impairment loss – – – – 2,200,000 2,200,000 – 2,200,000Non-cash expenses

other than depreciation – – 100,000 – – 100,000 – 100,000

No information by geographical location has been presented as the Group operates predominantly in Malaysia.

109



Primary Reporting - Business segments




RevenueExternal sales 165,302,020 9,261,145 10,286,441 715,725 976,252 – 186,541,583 99,199,372 285,740,955Inter-segment sales – – – – 7,204,800 (7,204,800) – – –Total revenue 165,302,020 9,261,145 10,286,441 715,725 8,181,052 (7,204,800) 186,541,583 99,199,372 285,740,955

ResultSegment result (24,086,350) (9,855,994) 297,828 (73,113) (13,762,196) 24,376,660 (23,103,165) 3,568,641 (19,534,524)Finance costs (14,208,109) (15,722) (14,223,831)Other income 1,100,884 446,218 1,547,102Share of net profit

of jointly controlledentities 9,479 9,479 – 9,479

(Loss)/Profit before tax (36,200,911) 3,999,137 (32,201,774)Income tax expense 1,643,326 (2,724,772) (1,081,446)(Loss)/Profit for the year (34,557,585) 1,274,365 (33,283,220)

110



Primary Reporting - Other informationContinuing operations Discontinued

operationsTrading Hospitality

Property and and InvestmentConstruction development services leisure holding Elimination Total Total

31.3.2007 RM RM RM RM RM RM RM RM RM

Other informationSegment assets 116,913,984 15,196,050 18,624,717 244,480 157,931,239 526,734 309,437,204 256,741,964 566,179,168Investment in jointly

controlled entities 229,733 – 229,733Consolidated total

assets 309,666,937 256,741,964 566,408,901

Segment liabilities 196,567,171 7,789,776 2,190,255 112,461 67,688,654 – 274,348,317 196,189,463 470,537,780Consolidated total

liabilities 274,348,317 196,189,463 470,537,780

Capital expenditure 1,928,575 – 315,312 – 14,995,301 17,239,188 59,414,274 76,653,462Depreciation 1,542,507 37,033 66,956 9,384 248,847 1,904,727 116,509 2,021,236Impairment loss – – – – 12,579,358 12,579,358 – 12,579,358Non-cash expenses other

than depreciation 1,302,062 – 215,866 21,295 676,000 2,215,223 450 2,215,673

No information by geographical location has been presented as the Group operates predominantly in Malaysia.

111


39. FINANCIAL INSTRUMENTS

(a) Interest rate risk

The following tables set out the carrying amounts, the weighted average effective interest rates (WAEIR) as at the balance sheet date and the remaining maturities of theGroup’s and the Company’s financial instruments that are exposed to interest rate risk.

Within 1 to 2 2 to 3 3 to 4 4 to 5 More thanWAEIR 1 year years years years years 5 years Total

As at 31.3.2008 Note % RM RM RM RM RM RM RM

GroupFixed rate

Hire purchase andfinance leaseliabilities 23 3.75 2,050,029 1,613,520 1,441,213 1,248,202 636,006 – 6,988,970

Floating rateCash and bankbalances 20 3.00 73,555,465 – – – – – 73,555,465Bank overdrafts 23 8.57 20,108,321 – – – – – 20,108,321Revolving credits 23 6.10 19,381,694 16,000,000 – – – – 35,381,694Trade finance 23 5.29 43,662,000 – – – – – 43,662,000Term loans 23 7.37 1,100,862 1,100,862 1,100,862 1,100,862 1,100,862 5,983,101 11,487,411Subordinated bond

2002/2007 12 – 400,000 – – – – – 400,000

CompanyFixed rate

Hire purchase andfinance lease liabilities 23 2.28 407,834 426,104 444,179 462,979 82,987 – 1,824,083

Floating rateCash and bank balances 20 3.00 5,117,349 – – – – – 5,117,349Bank overdrafts 23 7.33 178,854 – – – – – 178,854Revolving credits 23 6.39 4,009,797 – – – – – 4,009,797Term loans 23 7.37 75,210 75,210 75,210 75,210 75,210 1,111,361 1,487,411Subordinated bond

2002/2007 12 – 400,000 – – – – – 400,000

112


39. FINANCIAL INSTRUMENTS (Continued)

(a) Interest rate risk (Continued)

Within 1 to 2 2 to 3 3 to 4 4 to 5 More thanWAEIR 1 year years years years years 5 years Total

As at 31.3.2007 Note % RM RM RM RM RM RM RM

GroupFixed rate

Collateralised loanobligation 23 8.0 41,087,122 – – – – – 41,087,122

Hire purchase andfinance lease liabilities 23 6.2 845,469 692,424 300,708 146,907 153,165 – 2,138,673

Floating rateCash and bank balances 20 3.6 73,409,945 – – – – – 73,409,945Bank overdrafts 23 8.5 22,922,226 – – – – – 22,922,226Bridging loans 23 9.1 29,039,850 – – – – – 29,039,850Revolving credits 23 6.9 21,482,742 24,725,889 – – – – 46,208,631Trade finance 23 7.5 16,713,000 – – – – – 16,713,000Term loans 23 7.5 1,202,701 113,333 113,333 113,333 113,333 1,033,689 2,689,722Subordinated bond

2002/2007 12 – 4,000,000 – – – – – 4,000,000

CompanyFixed rate

Collateralised loanobligation 23 8.0 41,087,122 – – – – – 41,087,122

Hire purchase andfinance lease liabilities 23 10.9 82,060 77,010 66,619 80,454 83,907 – 390,050

Floating rateCash and bank balances 20 3.6 27,553 – – – – – 27,553Bank overdrafts 23 9.0 894,585 – – – – – 894,585Revolving credits 23 7.4 3,035,636 – – – – – 3,035,636Term loans 23 7.5 571,630 113,333 113,333 113,333 113,333 1,033,689 2,058,651Subordinated bond

2002/2007 12 – 4,000,000 – – – – – 4,000,000

113



(a) Interest rate risk (Continued)

Interest on financial instruments subject to floating interest rates is contractually repriced at intervals of less than six (6) months except for term loans and floating rate loanswhich are repriced annually. Interest on financial instruments at fixed rates are fixed until the maturity of the instrument. The other financial instruments of the Group and theCompany that are not included in the above tables are not subject to interest rate risk.

(b) Currencies profile of major financial assets and liabilities

Denominated inGroup other than Denominated in

functional currencies functional31.3.2008 US Dollar currencies Total

Other investments 148,308,200 2,052,848 150,361,048Trade and other receivables 40,234,376 142,730,234 182,964,610Cash and cash equivalents 3,794,474 69,760,991 73,555,465Trade and other payables 99,517 157,076,820 157,176,337

192,436,567 371,620,893 564,057,460

31.3.2007Other investments – 5,741,426 5,741,426Trade and other receivables – 105,901,192 105,901,192Cash and cash equivalents – 73,409,945 73,409,945Trade and other payables – 108,929,267 108,929,267

– 293,981,830 293,981,830Company

31.3.2008Other investments 148,308,200 1,001,900 149,310,100Trade and other receivables 31,520,638 12,477,102 43,997,740

179,828,838 13,479,002 193,307,84031.3.2007Other investment – 4,601,900 4,601,900Trade and other receivables – 19,502,920 19,502,920

– 24,104,820 24,104,820

114



(c) Fair values

The fair value of quoted shares is determined by reference to stock exchange quoted market bid prices at the close of the business on the balance sheet date. No disclosure ismade in respect of unquoted investment as it is not practicable to determine their fair values because of the lack of quoted market price.

The carrying amounts of cash and cash equivalents, receivables, deposits and prepayments, other payables, and accruals, and short term borrowings approximate fair valuesdue to the relatively short term nature of these financial instruments.

The fair values of finance lease liabilities approximate the carrying amounts shown in the balance sheets.

The Company provides financial guarantees to banks for credit facilities extended to certain subsidiaries. The fair value of such financial guarantee is not expected to bematerial as the probability of the subsidiaries defaulting on the credit lines is remote.

The Directors do not anticipate the carrying amounts recorded in the balance sheet to be significantly different from the fair values of the non-trade amounts due to/fromintergroup of Companies.

It is not practicable to estimate the fair value of contingent liabilities reliably due to the uncertainties of timing, costs and eventual outcome.

40. SUBSEQUENT EVENTS

On 3 March 2008, the Company announced that its wholly owned subsidiary, Ireka Venture Capital Limited has on 29 February 2008 entered into a Share Subscription Agreementwith KinhBac City Development Shareholding Corporation (“KBC”), a company incorporated in Socialist Republic of Vietnam and listed on the Hanoi Securities Trading Centre forthe acquisition of a strategic stake in KBC. The share acquisition represents 722,000 of new ordinary shares, out of an enlarged share base of 100,000,000 shares, at Vietnam Dong(“VND”) 110,000 per share. KBC is involved in the development, construction and operation of industrial and urban zones, and related infrastructure in Vietnam. The Board ofDirectors is of the opinion that the share acquisition in KBC is a strategic investment that will provide the Group with an avenue of venturing into the infrastructure developmentand construction market in Vietnam.

The share acquisition consideration of VND79.42 billion or equivalent to USD 5.011 million was paid to KBC on 10 April 2008.

115


41. COMPARATIVE FIGURES

The following comparative figures have been reclassified to ensure comparability with the current financial year :

31.3.2008As

As previouslyrestated reported

Company RM RM

Balance sheetAssets of disposal group classified as held for sale 4,350,000 –Investment in subsidiaries 49,486,983 53,836,983

Income statementCost of sales 1,906,575 606,575Other expenses 3,017,199 4,317,199

116


Authorised share capital : RM500,000,000.00Issued & fully paid-up capital : RM113,914,700.00Class of shares : Ordinary Share of RM1.00 eachVoting right : 1 vote per ordinary share

Size of holdings No. of shareholders No. of shares %

1 – 999 136 30,713 0.031,000 – 10,000 3,138 9,060,200 7.9510,001 – 100,000 319 8,251,504 7.24100,001 – 5,695,734 ^ 57 38,959,401 34.205,695,735 and above ^^ 4 57,612,882 50.58

Total 3,654 113,914,700 100.00

Remark : ^ Less than 5% of issued shares^^ 5% and above of issued shares

Direct IndirectDirectors’ shareholdings No. of shares % No. of shares %

Haji Abdullah Bin Yusof 1,500,000 1.32 15,398,248 * 13.52Lai Siew Wah - - 49,001,998 ** 43.02Datuk Lai Jaat Kong @ Lai Foot Kong PJN, JSM 4,827,100 4.24 - -Datuk Haji Burhanuddin Bin Ahmad Tajudin PJN 235,700 0.21 - -Chan Soo Har @ Chan Kay Chong 2,184,750 1.92 - -Lai Man Moi 2,040,750 1.79 - -Kwok Yoke How 1,742,603 1.53 - -Haji Mohd. Sharif Bin Haji Yusof - - - -Lai Voon Hon 12,000 # 49,001,998 ** 43.02Lai Voon Huey, Monica 6,000 # 49,001,998 ** 43.02

Direct IndirectSubstantial shareholders No. of shares % No. of shares %

Ideal Land Holdings Sdn Bhd 49,001,998 43.02 - -Magnipact Resources Sdn Bhd 15,398,248 13.52 - -Haji Abdullah Bin Yusof 1,500,000 1.32 15,398,248 * 13.52Lai Siew Wah - - 49,001,998 ** 43.02Lai Voon Hon 12,000 - 49,001,998 ** 43.02Lai Voon Keat - - 49,001,998 ** 43.02Lai Voon Wai - - 49,001,998 ** 43.02Liw Yoke Yin 11,600 # 49,001,998 ** 43.02

Notes* Deemed interests through Magnipact Resources Sdn Bhd** Deemed interests through Ideal Land Holdings Sdn Bhd# Insignificant

117

Statistics of Shareholdings AS AT 28 JULY 2008

Thirty (30) Largest Shareholders

No. Name No. of Shares %

1. Malaysia Nominees (Tempatan) Sdn Bhd (Pledged Securities Account for Ideal Land Holdings Sdn Bhd) 21,092,882 18.522. AmSec Nominees (Tempatan) Sdn Bhd (AmBank (M) Berhad for Ideal Land Holdings Sdn Bhd) 14,500,000 12.733. Mayban Nominees (Tempatan) Sdn Bhd (Pledged Securities Account for Ideal Land Holdings Sdn Bhd) 12,000,000 10.534. Mayban Nominees (Tempatan) Sdn Bhd (Pledged Securities Account for Magnipact Resources Sdn Bhd) 10,020,000 8.805. Lai Jaat Kong @ Lai Foot Kong 4,827,100 4.246. Ling Siok Guong 3,990,900 3.507. Malaysia Nominees (Tempatan) Sdn Bhd (Pledged Securities Account for Magnipact Resources Sdn Bhd) 3,585,499 3.158. EB Nominees (Tempatan) Sdn Bhd (Pledged Securities Account for Magnipact Resources Sdn Bhd (SFC)) 1,792,749 1.579. Kwok Yoke How 1,742,603 1.5310. CimSec Nominees (Tempatan) Sdn Bhd (EON Finance Berhad for Lai Man Moi) 1,529,250 1.3411. Abdullah Bin Yusof 1,500,000 1.3212. Mayban Nominees (Tempatan) Sdn Bhd (Pledged Securities Account for Lim Sow Mun (BKBS)) 1,439,800 1.2613. CimSec Nominees (Tempatan) Sdn Bhd (EON Finance Berhad for Chan Soo Har @ Chan Kay Chong) 1,378,250 1.2114. Malaysia Nominees (Tempatan) Sdn Bhd (Pledged Securities Account for Ideal Land Holdings Sdn Bhd) 1,316,250 1.1615. Sapiah @ Safiah Binti Hussin 1,265,000 1.1116. Thong Kok Cheong 1,025,500 0.9017. Citigroup Nominees (Asing) Sdn Bhd (UBS AG for Black River Asia Fund Ltd) 1,000,000 0.8818. Chan Lin Yau 776,800 0.6819. Mahomed Ferheen 719,900 0.6320. HSBC Nominees (Asing) Sdn Bhd (Exempt An for Credit Suisse (SG BR-TST-ASING) 706,100 0.6221. Ahmad Zaini Bin A.Jamil 600,000 0.5322. Lee Lak Chye @ Li Choy Hin 543,100 0.4823. CIMB Group Nominees (Tempatan) Sdn Bhd (Pledged Securities Account for Chan Soo Har @ Chan Kay Chong (4748 CWAY)) 511,500 0.4524. Lai Man Moi 511,500 0.4525. Choon Siew & Sons Sdn Bhd 500,000 0.4426. HSBC Nominees (Asing) Sdn Bhd (Exempt An For HSBC Broking Securities (Asia) Limited (Client A/c)) 435,200 0.3827. Tan Hwa Ling @ Tan Siew Leng 410,000 0.3628. Affin Nominees (Asing) Sdn Bhd (Exempt An For Phillip Securities (Hong Kong) Ltd (Clients’ Account)) 364,100 0.3229. Loh Chen Peng 364,000 0.3230. How Sue Chan @ Ho Sue Chan 327,400 0.29

118

Statistics of Shareholdings AS AT 28 JULY 2008 (cont’d)

ApproximateLand Area Net Book Year of

Location Tenure (Built-up Area) Description Age Value (RM) Acquisition

1. Lot PT17741, Mukim Batu Freehold 36,042 sq. ft. Office Suites N/A 15,790,550 2007Kuala Lumpur, Level 29-31 (under construction)one Mont’ Kiara, Mont’ Kiara

2. Lot PT17741, Mukim Batu Freehold 38,322 sq. ft. Office space for own use. 3 14,458,800 2007Kuala Lumpur, Sectors 3 – 13i-ZEN@Kiara II, Mont’ Kiara

3. CT No. 9985, Lot No. 5755 Freehold 272,915 sq. ft. Workshop with 2-storey N/A 9,560,453 1997Mukim Kajang office building for Selangor Darul Ehsan own use

4. Geran 12740, Lot 50592 Freehold 1,528 sq. ft. 4-storey shop office 20 years 678,794 1988Mukim of Kuala Lumpur (7,040 sq. ft.) for own useWilayah Persekutuan

5. Percinct 7, Plot G27 held under Geran 39540 Freehold 43,986 sq. ft. Homestate for investment N/A 439,570 1995Lot No. 1503, Mukim Sg. GumutDaerah Hulu Selangor

6. Plot No. H21, Precinct 8, Lembah Beringin Freehold 46,368 sq. ft. Homestate for investment N/A 278,208 2002Mukim Sungai Gumut, Daerah Hulu Selangor

7. Lot No. 2, Sector 1, Lembah Beringin Freehold 7,185 sq. ft. Bungalow lot for investment N/A 179,625 2002Mukim Kuala Kelumpang, Daerah Ulu Selangor

8. Geran 42276/M2/2/44 Freehold 824 sq. ft. Walk-up flat for investment 21 years 44,059 1987Lot 32432, Mukim of Plentong (884 sq. ft.)

119

List of Material Properties AS AT 31 MARCH 2008

NOTICE IS HEREBY GIVEN THAT the 32nd AnnualGeneral Meeting of the Company will be held at DewanPerdana, Bukit Kiara Equestrian & Country Resort, JalanBukit Kiara, Off Jalan Damansara, 60000 Kuala Lumpur onThursday, 18 September 2008 at 10.30 a.m. for thefollowing purposes:

AGENDA

1. To receive the audited financial statements togetherwith the reports of the Directors and Auditors for theyear ended 31 March 2008. Resolution 1

2. To declare a final dividend of 10% less income tax of26% for the financial year ended 31 March 2008

Resolution 2

3. To approve the payment of Directors’ fees ofRM350,000.00 for the year ended 31 March 2008.(2007 : RM260,000.00) Resolution 3

4. To consider and if thought fit, pass the followingresolution in accordance with Section 129 of theCompanies Act, 1965:

a. “THAT Tuan Haji Abdullah Bin Yusof who retirespursuant to Section 129 of the Companies Act,1965 be and is hereby re-appointed a Director ofthe Company to hold office until the next AnnualGeneral Meeting.” Resolution 4

b. “THAT Datuk Haji Burhanuddin Bin Ahmad Tajudin(PJN) who retires pursuant to Section 129 of theCompanies Act, 1965 be and is hereby re-appointed a Director of the Company to holdoffice until the next Annual General Meeting.”

Resolution 5

5. To re-elect the following Directors who retire inaccordance with Article 91 of the Company’s Articlesof Association:

a. Kwok Yoke How Resolution 6b. Lai Voon Huey, Monica Resolution 7c. Haji Mohd. Sharif Bin Haji Yusof Resolution 8

6. To re-appoint Messrs. Raja Salleh, Lim & Co. asAuditors of the Company to hold office until theconclusion of the next Annual General Meeting of theCompany at a remuneration to be fixed by theDirectors. Resolution 9

7. Special Business

To consider and, if thought fit, to pass the followingOrdinary Resolution:

“THAT pursuant to Section 132D of the CompaniesAct, 1965, the Directors be and are herebyempowered to issue and allot shares in the Companyat any time and upon such terms and conditions andfor such purposes as the Directors may, in theirabsolute discretion deem fit, provided that theaggregate number of shares issued pursuant to thisresolution does not exceed 10% of the issued sharecapital of the Company for the time being and thatthe Directors be and are hereby empowered to obtainthe approval for the listing of and quotation for theadditional shares so issued on Bursa MalaysiaSecurities Berhad and THAT such authority shallcontinue in force until the conclusion of the nextAnnual General Meeting of the Company”.

Resolution 10

8. To transact any other business for which due noticeshall have been given in accordance with theCompany’s Articles of Association and the CompaniesAct, 1965.

By Order of The Board

Wong Yim ChengCompany Secretary Kuala Lumpur

Date : 27 August 2008

Notes:

1. A member entitled to attend and vote is entitled to appoint proxy toattend and vote in his stead. A proxy need not be a member of theCompany. A member may appoint any person to be his proxy withoutlimitation and the provisions of Section 149(1)(b) of the Companies Act,1965 shall not apply.

2. Where a member appoints two (2) proxies to attend the same meeting, themember shall specify the proportion of his shareholdings to berepresented by each proxy.

3. The instrument appointing a proxy shall be in writing under the hand ofthe appointor or of his attorney duly authorized in writing or, if theappointor is a corporation, either under its common seal or under the handof an officer or attorney duly authorized. Where the instrument appointinga proxy with the power of attorney or other authority (if any) under whichit is signed or a notarially certified or office copy of such power or authority,shall be deposited together with the Proxy Form.

4. The proxy form duly completed, must be deposited at the Company’sRegistered Office, No. 32 Medan Setia Dua, Bukit Damansara, 50490 KualaLumpur not less than 48 hours before the time set for holding the Meetingor any adjournment thereof.

Explanatory Notes On Special Business

The Ordinary Resolution 10, if passed, will empowered the Directors to issue andallot shares not exceeding 10% of the Company’s issued share capital for thetime being without convening further general meetings for such purpose.

120

Notice of Annual General Meeting

1. The names of individuals who are standing for re-election

i. Haji Abdullah Bin Yusof, retiring pursuant to Section 129 of the Companies Act, 1965. ii. Datuk Haji Burhanuddin Bin Ahmad Tajudin PJN, retiring pursuant to Section 129 of the Companies Act, 1965.iii. Kwok Yoke How, retiring by rotation pursuant to Article 91 of the Company’s Articles of Association.iv. Lai Voon Huey, Monica, retiring by rotation pursuant to Article 91 of the Company’s Articles of Association.v. Haji Mohd. Sharif bin Haji Yusof, retiring by rotation pursuant to Article 91 of the Company’s Articles of Association.

2. Details of attendance of Directors at board meetings

During the financial year, five (5) board meetings were held. Details of attendance of Directors at the Board Meetings are as follows:-

Name Attendance

i. Haji Abdullah BinYusof 5/5ii. Lai Siew Wah 4/5iii. Datuk Lai Jaat Kong @ Lai Foot Kong PJN, JSM 5/5iv. Datuk Haji Burhanuddin Bin Ahmad Tajudin PJN 5/5v. Lai Man Moi 5/5vi. Chan Soo Har @ Chan Kay Chong 5/5vii. Kwok Yoke How 4/5viii. Haji Mohd. Sharif Bin Haji Yusof 4/5ix. Lai Voon Hon 3/5x. Lai Voon Huey, Monica 5/5

3. Date, time and place of general meeting

Type of Meeting Date Time Place

32nd Annual General Meeting 18 September 2008 10.30 a.m. Dewan Perdana, Bukit Kiara Equestrian & Country Resort, Off Jalan Damansara 60000 Kuala Lumpur

4. Further details of Directors who are standing for election

Not applicable

121

Statement Accompanying Notice of 32nd Annual General Meeting of Ireka Corporation Berhad

This page has been intentionally left blank.

Proxy Form

I/We

NRIC No.

of

being a member/members of Ireka Corporation Berhad hereby appoint

NRIC No.

or failing him, the Chairman of the Meeting as my/our proxy, to vote for me/us and on my/our behalf at the 32nd AnnualGeneral Meeting of the Company to be held at Dewan Perdana, Bukit Kiara Equestrian & Country Resort, Off JalanDamansara, 60000 Kuala Lumpur on Thursday, 18 September 2008 at 10.30 a.m. and at any adjournment thereof.My/our proxy is to vote as indicated below:

No. Ordinary Resolutions For Against

1 To receive the audited financial statements for the financial year ended 31 March 2008

2 To declare a final dividend of 10% less income tax of 26 % for the financial year ended 31 March 2008

3 To approve the payment of Directors’ fee of RM350,000.00

4 Re-election of Director, Haji Abdullah Bin Yusof

5 Re-election of Director, Datuk Haji Burhanuddin Bin Ahmad Tajudin PJN.

6 Re-election of Director, Kwok Yoke How

7 Re-election of Director, Lai Voon Huey, Monica

8 Re-election of Director, Haji Mohd Sharif Bin Haji Yusof

9 Re-appointment of Messrs Raja Salleh, Lim & Co. as Auditors

10 To issue and allot shares pursuant to S132D of the Companies Act, 1965

Please indicate with an ‘X’ in the appropriate spaces how you wish to cast your vote. If you do not indicate how you wishyour proxy to vote on any resolution, your proxy will vote as he thinks fit or, at his discretion, abstain from voting.

No. of shares held:

CDS Account No.:

Signature/Seal

Dated this day of 2008.

Notes :

1. A member entitled to attend and vote is entitled to appoint proxy toattend and vote in his stead. A proxy need not be a member of theCompany. A member may appoint any person to be his proxy withoutlimitation and the provisions of Section 149(1)(b) of the CompaniesAct, 1965 shall not apply.

2. Where a member appoints two (2) proxies to attend the samemeeting, the member shall specify the proportion of hisshareholdings to be represented by each proxy.

3. The instrument appointing a proxy shall be in writing under the handof the appointor or of his attorney duly authorized in writing or, if theappointor is a corporation, either under its common seal or under thehand of an officer or attorney duly authorized. Where the instrumentappointing a proxy with the power of attorney or other authority (ifany) under which it is signed or a notarially certified or office copy ofsuch power or authority, shall be deposited together with the ProxyForm.

4. The proxy form duly completed, must be deposited at the Company’sRegistered Office, No. 32 Medan Setia Dua, Bukit Damansara, 50490Kuala Lumpur not less than 48 hours before the time set for holdingthe Meeting or any adjournment thereof.

IREKA CORPORATION BERHAD Co. No.: 25882-A

No. 32 Medan Setia DuaBukit Damansara50490 Kuala LumpurAttn: The Company Secretary

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