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| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Asia Wealth Group Holdings Ltd | AQSE:AWLP | Aquis Stock Exchange | Ordinary Share | VGG0540E1097 | Ordinary shares |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| 0.00 | 0.00% | 17.50 | 5.00 | 20.00 | 17.50 | 12.50 | 17.50 | 0.00 | 15:29:37 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| 0 | 0 | N/A | 0 |
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TIDMAWLP
FOR IMMEDIATE RELEASE 5
November 2021
Asia Wealth Group Holdings Limited
("Asia Wealth", the "Group" or the "Company")
UNAUDITED INTERIM RESULTS
FOR THE SIX MONTHSED 31 AUGUST 2021
The Board is pleased to report the unaudited interim results of Asia Wealth
Group Holdings Limited ("Accounts") for the period from 1 March 2021 to 31
August 2021. These Accounts have been prepared under IFRS and will shortly be
available via the Company's website, www.asiawealthgroup.com.
Chairman's Statement
Financial Highlights
The highlights for the six months ended 31 August 2021 include:
* Consolidated revenue of US$940,113 (2020: US$894,083)
* Gross profit for Meyer Group of US$529,130 (representing a gross margin of
56%) (2020: US$421,669 and 47%)
* Cash at bank and on hand of US$1,363,101 at 31 August 2021 (2020:
$897,696).
The Group reports a profit after tax of US$123,067 on sales of US$940,113 for
the six months ended 31 August 2021. These sales were principally generated by
the Company's wholly owned subsidiary, Meyer Asset Management Ltd., BVI. This
improvement in profitability was principally caused by revenue increase.
Cash balance has increased by US$196,351 and net assets by US$91,194,
respectively, since 1st March 2021.
The Board has taken and is continuing to forge new revenue generating
relationships, as well as expanding revenue creating opportunities, in both new
avenues and existing. We continue to seek alliances and partnerships with firms
in the same and new sectors.
Asia Wealth continues to seek investment opportunities in the UK as well as in
the Asia region and is currently engaged in multiple discussions on various
potential acquisitions. The Directors continue to run the business in a
cost-effective manner.
The Accounts have not been audited or reviewed by the Company's auditors.
The Directors of the Company accept responsibility for the content of this
announcement.
Richard Cayne
Executive Chairman
Contacts:
Richard Cayne (Executive Chairman)
Asia Wealth Group Holdings Limited, +66 2 2611 2561
www.asiawealthgroup.com
Guy Miller (Corporate Advisers)
Peterhouse Capital Limited, +44 20 7220 9795
EXTRACTS ARE SET OUT BELOW:
ASIA WEALTH GROUP HOLDINGS LIMITED
Consolidated Statement of Financial Position
At 31 August 2021
Expressed in U.S. Dollars
Note 31-Aug-21 31-Aug-20
Restated
Non-current assets
Fixed assets 4 2,900 4,363
Investment property 3,5,16 651,787 679,080
654,687 683,443
Current assets
Cash and cash equivalents 1,363,101 897,696
Trade receivables 104,135 113,354
Financial assets at fair value 6 240,994 228,979
through profit or loss
Due from director 8 507,605 -
Loans and other receivables 7 63,251 709,264
Prepaid tax 562 1,421
Prepayments and other assets 56,801 90,222
2,336,449 2,040,936
Total assets $ 2,991,136 $ 2,724,379
Equity
Share capital 9 913,496 913,496
Treasury shares 9 (318,162) (318,162)
Consolidation reserve 405,997 405,997
Translation reserve 16 17,971 34,880
Retained earnings 16 681,128 481,328
Total equity 1,700,430 1,517,539
Current liabilities
Trade payables 1,252,926 1,116,497
Due to director 8 - 4,335
Other payables and accrued expenses 8 37,780 86,008
Total liabilities 1,290,706 1,206,840
Total equity and liabilities $ 2,991,136 $ 2,724,379
ASIA WEALTH GROUP HOLDINGS LIMITED
Consolidated Statement of Comprehensive Income
For the half year ended 31 August 2021
Expressed in U.S. Dollars
Note Mar - Aug Mar - Aug
2021 2020
Restated
Revenue
Commission income 940,113 888,586
Rental income 5 - 5,497
Revenue 940,113 894,083
Expenses
Commission expense 418,506 473,844
Directors' fees 8 151,711 172,101
Professional fees 8 132,372 128,918
Wages and salaries 30,138 32,939
Office expenses 24,012 29,727
Travel and entertainment 6,832 6,123
Rent 9,068 7,795
Impairment losses - 3,083
Marketing 3,234 3,497
Depreciation 4,16 1,228 1,554
Other expenses 4,771 5,169
781,872 864,750
Net profit/(loss) from operations 158,241 29,333
Other income/(expenses)
Foreign currency exchange gain/ (52,948) 30,275
(loss)
Other income 17,774 57,226
(35,174) 87,501
Net profit/(loss) before finance 123,067 116,834
costs
Finance costs
Interest expense - 60
Net profit/(loss) before taxation 123,067 116,774
Taxation 10 - -
Total comprehensive income/(loss) $ 123,067 $ 116,774
ASIA WEALTH GROUP HOLDINGS LIMITED
Consolidated Statement of Changes in Equity
For the half year ended 31 August 2021
Expressed in U.S. Dollars
31-Aug-21
Share Capital Treasury Consolidation Translation Retained Equity
Shares Reserve Reserve Earnings
Number US$
Balances at beginning of 1 Mar 2021, 11,433,433 913,496 (318,162) 405,997 49,844 558,061 1,609,236
as restated
Translation differences - - - (31,873) - (31,873)
Total comprehensive income - - - - 123,067 123,067
Balances at end of 31 Aug 2021 11,433,433 913,496 (318,162) 405,997 17,971 681,128 1,700,430
31-Aug-20
Share Capital Treasury Consolidation Translation Retained Equity
Shares Reserve Reserve Earnings
Number US$
Balances at beginning of 1 Mar 2020, 11,433,433 913,496 (318,162) 405,997 27,653 364,554 1,393,538
as restated
Translation differences - - - 7,227 - 7,227
Total comprehensive income - - - - 116,774 116,774
Balances at end of 31 Aug 2020 11,433,433 913,496 (318,162) 405,997 34,880 481,328 1,517,539
ASIA WEALTH GROUP HOLDINGS LIMITED
Consolidated Statement of Cash Flows
For the half year ended 31 August 2021
Expressed in U.S. Dollars
Mar - Aug 2021 Mar - Aug 2020
Restated
Operating activities
Total comprehensive income/(Loss) 123,067 116,774
Adjustments for:
Depreciation 1,228 1,554
Foreign currency exchange (gain)/loss (31,873) 7,227
Operating income/(loss) before changes in operating
assets and liabilities 92,422 125,555
Changes in operating assets and
liabilities:
Trade receivables 22,065 67,098
Loan and other receivable (35,339) (38,638)
Prepaid tax (307) -
Prepayments and other assets 70,041 3,267
Trade payables 17,729 114,765
Tax payable (140) -
Deferred Revenue - (2,702)
Other Payables and Accrued Expenses (20,158) (31,018)
Cash flows from/(used in) operating 146,313 238,327
activities
Investing activities
Acquisition of fixed assets (1,106) (975)
Investment property 51,175 (11,663)
Cash flows from/(used in) investing 50,069 (12,638)
activities
Financing activities
Net advances from related party (31) (7)
Cash flows from/(used in) financing (31) (7)
activities
Net increase/(decrease) in cash and cash 196,351 225,682
equivalents
Cash and cash equivalents at beginning of 1,166,750 672,014
year
Cash and cash equivalents at end of period $ 1,363,101 $ 897,696
Cash and cash equivalents comprise cash at
bank.
ASIA WEALTH GROUP HOLDINGS LIMITED
Notes to and forming part of the Consolidated Financial Statements
For the half year ended 31 August 2021
Expressed in U.S. Dollars
1) GENERAL INFORMATION
Asia Wealth Group Holdings Limited (the "Parent Company") was incorporated in
the British Virgin Islands on 7 October 2010 under the BVI Business Companies
Act, 2004. The liability of the shareholders is limited by shares. The Parent
Company maintains its registered office in the British Virgin Islands. The
consolidated financial statements were authorised for issue by the Board of
Directors on 2 November 2021.
The principal activity of the Parent Company and its subsidiaries (the "Group")
is to provide wealth management advisory services to Asian-based high net worth
individuals and corporations.
The Parent Company's shares were listed on the PLUS Stock Exchange based in
London, United Kingdom. In June 2012, ICAP Plc, an interdealer broker based in
London, United Kingdom, bought PLUS Stock Exchange and rebranded and relaunched
it as ICAP Securities & Derivatives Exchange ("ISDX"). On 30 December 2016,
ISDX was renamed NEX Exchange. The Parent Company's shares were automatically
admitted to NEX Exchange.
The Parent Company has the following subsidiaries as at 31 August 2021 and 31
August 2020:
Incorporation Country of Functional Ownership
Date Incorporation Currency Interest
2021 2020
Meyer Asset 2000 British U.S. 100.00% 100.00%
Management Ltd. Virgin Dollars
("Meyer BVI") Islands
Meyer International 2010 Thailand Thailand 49.00% 49.00%
Limited ("Meyer Baht
Thailand")
Prime RE Limited 2016 Thailand Thailand 49.00% 49.00%
("Prime RE") Baht
On 13 June 2012, Meyer BVI was licensed to provide investment business services
under Section 3 of the Securities and Investment Business Act, 2010 of the
British Virgin Islands.
On 23 September 2016, Meyer Thailand acquired 51.00% of Prime RE.
On 20 October 2016, 51.00% of Meyer Thailand, owned beneficially via a trust
agreement in favour of Meyer BVI, was acquired by Prime RE.
Therefore the Company is the indirect owner of 51.00% of the outstanding shares
of Prime RE and Meyer Thailand, and accordingly the Company has accounted for
them as wholly owned subsidiaries.
2) SIGNIFICANT ACCOUNTING POLICIES
The significant accounting policies adopted in the preparation of the Group's
consolidated financial statements are set out below.
a) Statement of compliance
The consolidated financial statements of the Group have been prepared in
accordance with International Financial Reporting Standards ("IFRSs") and
interpretations issued by the IFRS Interpretations Committee ("IFRS IC")
applicable to companies reporting under IFRSs. The financial statements comply
with IFRSs as issued by the International Accounting Standards Board ("IASB").
b) Basis of preparation
The consolidated financial statements have been prepared on the basis of
historical costs and do not take into account increases in the market value of
assets except for financial assets at fair value through profit or loss and
investment property measured at fair value.
The Group's financial statements and records are maintained and presented in
U.S. Dollars, rounded to the nearest dollar.
The accounting policies have been consistently applied by the Group and are
consistent with those used in the previous year, except for the Group's
voluntary change in accounting policy in measuring investment property using
the fair value model under International Accounting Standard (IAS) 40,
"Investment Property" ("IAS 40"). See note 3 for an explanation of the impact.
There are no new, revised or amended IFRSs or IFRS IC interpretations that are
effective for the first time for the financial period beginning 1 March 2020
that would be expected to have a material impact on the Group's consolidated
financial statements.
c) Use of estimates
The preparation of consolidated financial statements in conformity with IFRSs
requires management to make judgments, estimates and assumptions that affect
the application of policies and the reported amounts of assets and liabilities,
income and expenses. The estimates and associated assumptions are based on
historical experience and various other factors that are believed to be
reasonable under the circumstances, the results of which form the basis of
making the judgments about carrying values of assets and liabilities that are
not readily apparent from other sources. Actual results may differ from these
estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis.
Revisions to accounting estimates are recognised in the period in which the
estimate is revised if the revision affects only that period or in the period
of the revision and future periods if the revision affects both current and
future periods.
Global pandemic
The global pandemic relating to an outbreak of Corona Virus Disease 2019
("COVID-19") has cast additional uncertainty on the assumptions used by
management in making its judgments and estimates. Governments around the world
have reacted with significant monetary and fiscal intervention designed to
stabilise economic conditions. The duration and impact of the COVID-19
outbreak is unknown at this time. It is not possible to reliably estimate the
length and severity of these developments and the impact on the financial
results and condition of the Group in future periods.
2) SIGNIFICANT ACCOUNTING POLICIES (Cont'd)
c) Use of estimates (Cont'd)
Global pandemic (Cont'd)
Given the full extent of the impact COVID-19 will have on the global economy is
unclear, the Group's businesses are highly uncertain and difficult to predict
at this time. Accordingly, there is a higher level of uncertainty with respect
to management's judgments and estimates.
Impairment of receivables
Provision for doubtful accounts is maintained at a level considered adequate to
provide for potentially uncollectible receivables. The level of allowance for
doubtful accounts is based on ageing of the accounts receivable, past
collection trends and other factors that may affect collectability including
knowledge of individual customer circumstances, customer credit-worthiness and
current economic trends. An allowance account is used when there is objective
evidence that the Group will not be able to collect all amounts due according
to the original terms of the agreement.
Determination of fair value of investment property
The Group obtains independent valuations for its investment property at least
annually. At the end of each reporting period, the Directors update their
assessment of the fair value, taking into account the most recent independent
valuations. The Directors determine a property's value within a range of
reasonable fair value estimates. The best evidence of fair value is current
prices in an active market for similar properties. Where such information is
not available the Directors consider information from a variety of sources
including:
* current prices in an active market for properties of a different nature or
recent prices of similar properties in less active markets, adjusted to
reflect those differences
* discounted cash flow projections based on reliable estimates of future cash
flows
* capitalised income projections based on a property's estimated net market
income, and a capitalisation rate derived from an analysis of market
evidence.
Judgments on going concern
A key assumption in the preparation of the consolidated financial statements is
that the Group will continue as a going concern. The going concern assumption
assumes that the Group will continue in operation for the foreseeable future
and will be able to realise its assets and discharge its liabilities in the
normal course of operations.
d) Principles of consolidation
Subsidiaries
The consolidated financial statements include the financial statements of the
Parent Company and its subsidiaries for the half year ended 31 August 2021. Details of the Group are set out in note 1. 2) SIGNIFICANT ACCOUNTING POLICIES (Cont'd) d) Principles of consolidation (Cont'd) Subsidiaries (Cont'd) Subsidiaries are all entities (including structured entities) over which the Group has control. The Group controls an entity where the Group is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns through its power to direct the activities of the entity. Subsidiaries are fully consolidated from the date on which control is transferred to the Group. They are deconsolidated from the date that control ceases. Non-controlling interests pertain to the equity in a subsidiary not attributable, directly or indirectly to the Parent Company. Any equity instruments issued by a subsidiary that are not owned by the Parent Company are non-controlling interests including preferred shares and options under share-based transactions. Non-controlling interests represent the portion of profit or loss and net assets in subsidiaries not wholly-owned and are presented in the consolidated statement of comprehensive income, consolidated statement of changes in equity and consolidated statement of financial position, separately from the Parent Company's equity. Losses within a subsidiary are attributed to the non-controlling interests even if that results in a deficit balance. A change in the ownership interest of a subsidiary, without a loss of control, is accounted for as an equity transaction. Any difference between the amount by which the non-controlling interests are adjusted and the fair value of the consideration paid or received is recognised directly in equity as an "equity reserve" and attributed to the owners of the Group. Inter-company transactions, balances and unrealised gains on transactions between group companies are eliminated. Unrealised losses are also eliminated unless the transaction provides evidence of an impairment of the transferred asset. Accounting policies of subsidiaries have been changed where necessary to ensure consistency with the policies adopted by the Group. Acquisitions The acquisition method of accounting is used to account for business combinations by the Group. The consideration transferred for the acquisition of a subsidiary or business comprises the fair value of the assets transferred, the liabilities incurred and the equity interests issued by the Group. The consideration transferred also includes the fair value of any contingent consideration arrangement and the fair value of any pre-existing equity interest in the subsidiary. Acquisition-related costs are expensed as incurred. Identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination are, with limited exceptions, measured initially at their fair values at the acquisition date. On an acquisition-by-acquisition basis, the Group recognises any non-controlling interest in the acquiree at the date of acquisition either at fair value or at the non-controlling interest's proportionate share of the acquiree's net identifiable assets. 2) SIGNIFICANT ACCOUNTING POLICIES (Cont'd) d) Principles of consolidation (Cont'd) Acquisitions (Cont'd) The excess of (i) the consideration transferred, the amount of any non-controlling interest in the acquiree and the acquisition-date fair value of any previous equity interest in the acquiree over the (ii) fair value of the net identifiable assets acquired is recorded as goodwill. Where settlement of any part of cash consideration is deferred, the amounts payable in the future are discounted to their present value as at the date of exchange. The discount rate used is the entity's incremental borrowing rate, being the rate at which a similar borrowing could be obtained from an independent financier under comparable terms and conditions. Contingent consideration is classified either as equity or a financial liability. Amounts classified as a financial liability are subsequently remeasured to fair value with changes in fair value recognised in profit or loss. If the business combination is achieved in stages, the acquisition date carrying value of the acquirer's previously held equity interest in the acquiree is remeasured to fair value at the acquisition date. Any gains or losses arising from such remeasurement are recognised in profit or loss. e) Fixed assets Fixed assets are stated at historical cost less accumulated depreciation and impairment loss, if any. Depreciation is charged to the consolidated statement of comprehensive income on a straight line basis over the estimated useful lives of the fixed assets. The annual rates of depreciation in use are as follows: Leasehold improvements 20% Office equipment 20-33% Vehicles 20% 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 any component accounted for as a separate asset is derecognised when replaced. All other repairs and maintenance are charged to profit or loss during the reporting period in which they are incurred. f) Investment property Property that is held for long-term rental yields or for capital appreciation or both, and that is not occupied by the companies in the consolidated Group, is classified as investment property. Investment property is measured initially at cost including transaction costs. Transaction costs include transfer taxes, professional fees for legal services and initial leasing commissions to bring the property to the condition necessary for it to be capable of operating. The carrying amount also includes the cost of replacing part of an existing investment property at the time that cost is incurred if the recognition criteria are met. 2) SIGNIFICANT ACCOUNTING POLICIES (Cont'd) f) Investment property (Cont'd) During the year, the Group voluntarily changed its accounting policy in measuring investment property using the fair value model and has restated comparative information. Subsequent to initial recognition, investment property is stated at fair value. Gains or losses arising from changes in the fair values are included in the consolidated statement of comprehensive income in the year in which they arise, including the corresponding tax effect, if any. Fair value is based on active market prices, adjusted, if necessary, for differences in the nature, location or condition of the specific asset. If this information is not available, the Group uses alternative valuation methods, such as recent prices on less active markets or discounted cash flow projections. Valuations are performed as at the reporting date by professional independent appraisers who hold recognised and relevant professional qualifications and have recent experience in the location and category of investment property being valued. These valuations form the basis for the carrying amounts in the consolidated financial statements. The fair value of investment property reflects, among other things, rental income from current leases and other assumptions market participants would make when pricing the property under current market conditions. Subsequent expenditure is capitalised to the asset's carrying amount only when it is probable that future economic benefits associated with the expenditure will flow to the Group and the cost of the item can be measured reliably. All other repairs and maintenance costs are expensed when incurred. When part of an investment property is replaced, the cost of the replacement is included in the carrying amount of the property, and the fair value is reassessed. Investment property is derecognised when it has been disposed of or permanently withdrawn from use and no future economic benefit is expected from its disposal. The difference between the net disposal proceeds and the carrying amount of the asset would result in either gains or losses at the retirement or disposal of investment property. Investment property comprises condominium units. Accounting policies applied up to 29 February 2020 Until 29 February 2020, the Group initially measured its investment property at cost and subsequently at cost less any accumulated depreciation and impairment losses (refer to accounting policy (k)), if any, with any change therein recognised in the consolidated statement of comprehensive income. Cost includes expenditure that is directly attributable to the acquisition of investment property. The cost of self-constructed investment property includes the cost of materials and direct labour, any other costs directly attributable to bringing the investment property to a working condition for its intended use and capitalised borrowing costs. Any gain or loss on disposal of an investment property (calculated as the difference between the net proceeds from disposal and the carrying amount of the item) is recognised in the consolidated statement of comprehensive income. When an investment property that was previously classified as property, plant and equipment is sold, any related amount included in the revaluation reserve is transferred to retained earnings. 2) SIGNIFICANT ACCOUNTING POLICIES (Cont'd) f) Investment property (Cont'd) When the use of property changes such that it is reclassified as fixed assets, its fair value at the date of reclassification becomes its cost for subsequent accounting. Depreciable investment property was stated at cost less accumulated depreciation. Depreciation was charged to the consolidated statement of
comprehensive income on a straight-line basis over the estimated useful lives
of the investment property.
The annual rate of depreciation in use for condominium units was 5%.
Subsequent expenditure incurred was capitalised only when it increases the
future economic benefits embodied in that property. All other expenditure was
recognised in the consolidated statement of comprehensive income when it was
incurred.
g) Cash and cash equivalents
For the purpose of presentation in the consolidated statement of cash flows,
cash and cash equivalents include current deposits with banks and other
short-term highly liquid financial instruments with original maturities of
three months or less that are readily convertible to known amounts of cash and
are subject to an insignificant risk of changes in value, and bank overdrafts.
Short-term investments that are not held for the purpose of meeting short-term
cash commitments and restricted margin accounts are not considered as 'cash and
cash equivalents'.
For the purpose of the consolidated statement of cash flows, cash and cash
equivalents consist of cash and cash equivalents as defined above, net of
outstanding bank overdrafts when applicable.
h) Other financial instruments
i) Classification
The Group classifies its financial assets and liabilities at initial
recognition into the following categories:
* those to be measured subsequently at fair value, either through profit or
loss or other comprehensive income; and
* those to be measured at amortised cost.
Financial assets at fair value through profit or loss
The Group classifies the following financial assets at fair value through
profit or loss ("FVPL"):
* debt investments that do not qualify for measurement at either amortised
cost or financial assets at fair value through other comprehensive income
("FVOCI");
* equity investments that are held for trading, and
* equity investments for which the Group has not elected to recognise fair
value gains and losses through other comprehensive income.
2) SIGNIFICANT ACCOUNTING POLICIES (Cont'd)
h) Other financial instruments (Cont'd)
i) Classification (Cont'd)
A financial asset is considered to be held for trading if:
* it is acquired or incurred principally for the purpose of selling or
repurchasing in the near term; or
* on initial recognition, it is part of a portfolio of identified financial
instruments that are managed together and for which, there is evidence of a
recent actual pattern of short-term profit-taking; or
* it is a derivative, except for a derivative that is a financial guarantee
contract or a designated and effective hedging instrument.
Financial instruments at amortised cost
Financial assets and liabilities at amortised cost comprise debt instruments.
A debt instrument is measured at amortised cost if it is held within a business
model whose objective is to hold financial assets in order to collect
contractual cash flows and its contractual terms give rise on specified dates
to cash flows that are solely payments of principal and interest on the
principal amount outstanding.
ii) Recognition, derecognition and measurement
Regular purchases and sales of financial assets are recognised on the trade
date, the date on which the Group commits to purchase or sell the instrument.
Financial assets and financial liabilities at fair value are initially
recognised at fair value. Transaction costs are expensed as incurred in the
consolidated statement of comprehensive income.
Financial assets and liabilities are derecognised when the rights to receive
cash flows from the financial assets and liabilities have expired or the Group
has transferred substantially all risks and rewards of ownership.
Debt instruments
Subsequent measurement of debt instruments depends on the Group's business
model for managing the asset and the cash flow characteristics of the asset.
The following are the measurement categories into which the Group classifies
its debt instruments:
* Amortised cost
Assets and liabilities that are held for collection of contractual cash flows
where those cash flows represent solely payments of principal and interest are
measured at amortised cost.Interest income from these financial assets is
included in financial income using the effective interest rate method.Any gain
or loss arising on derecognition is recognised directly in profit or loss and
presented in other gains/(losses) together with foreign exchange gains and
losses.
2) SIGNIFICANT ACCOUNTING POLICIES (Cont'd)
h) Other financial instruments (Cont'd)
ii) Recognition, derecognition and measurement (Cont'd)
* Fair value through profit or loss
Assets that do not meet the criteria for amortised cost or fair value through
other comprehensive income are measured at fair value through profit or loss.A
gain or loss on a debt investment that is subsequently measured at fair value
through profit or loss is recognised in profit or loss and presented net within
other gains/(losses) in the period in which it arises.
Equity instruments and other investment funds
The Group subsequently measures all equity instruments and other investment
funds at fair value.
Changes in the fair value of financial assets at fair value through profit or
loss are recognised in other gains/(losses) in the consolidated statement of
comprehensive income. Impairment losses and reversal of impairment losses on
equity investments measured at fair value through other comprehensive income
are not reported separately from other changes in fair value.
iii) Fair value estimation
Fair value is the price that would be received to sell an asset or paid to
transfer a liability in an orderly transaction between market participants at
the measurement date.
The fair value of financial assets and liabilities that are not traded in an
active market is determined using valuation techniques. Valuation techniques
used include the use of comparable recent arm's length transactions and market
price provided by the underlying entity as a result of its independent
appraiser's valuation based on market inputs. Investments in non-exchange
traded investment funds are recorded at the net asset value per share as
reported by the respective administrators of such funds.
For assets and liabilities that are measured at fair value on a recurring
basis, the Group identifies transfers between levels in the hierarchy by
re-assessing the categorisation (based on the lowest level of input that is
significant to the fair value measurement as a whole), and deems transfers to
have occurred at the beginning of each reporting period.
iv) Impairment
The Group applies the general approach permitted by IFRS 9, "Financial
Instruments" ("IFRS 9"), which requires expected credit losses ("ECL") to be
recognised based on the full three-stage model as follows:
* Stage 1: Items that have not deteriorated significantly in credit quality
since initial recognition. A loss allowance equal to 12-month ECL is
recognised and interest income is calculated on the gross carrying amount
of the financial asset.
2) SIGNIFICANT ACCOUNTING POLICIES (Cont'd)
h) Other financial instruments (Cont'd)
iv) Impairment (Cont'd)
* Stage 2: Items that have deteriorated significantly in credit quality since
initial recognition, but do not have objective evidence of a credit loss
event. A loss allowance equal to lifetime ECL is recognised, but interest
income is still calculated on the gross carrying amount of the asset.
* Stage 3: Items that have objective evidence of impairment at the reporting
date. A loss allowance equal to lifetime ECL is recognised and interest
income is calculated on the net carrying amount.
Impairment losses are presented as a separate line item in the consolidated
statement of comprehensive income.
The Group considers a receivable in default when contractual payments are over
365 days past due. However, in certain cases, the Group may also consider a
receivable to be in default when internal and external information indicates
that the Group is unlikely to receive the outstanding contractual amounts in
full before taking into account any credit enhancements held by the Group. A
receivable is written off when there is no reasonable expectation of recovering
the contractual cash flows.
Receivables for which an impairment provision was recognised, are written off
against the provision when there is no expectation of recovering additional
cash.
i) Equity
Share capital represents the nominal value of shares that have been issued.
Incremental costs directly attributable to the issue of ordinary shares are
recognised as a deduction from equity.
Where any group company purchases the Parent Company's equity instruments, for
example as the result of a share buy-back or a share-based payment plan, the
consideration paid, including any directly attributable incremental costs (net
of income taxes) is deducted from equity attributable to the owners of the
Group as treasury shares until the shares are cancelled or reissued. Where such
ordinary shares are subsequently reissued, any consideration received, net of
any directly attributable incremental transaction costs and the related income
tax effects, is included in equity attributable to the owners of the Group.
Retained earnings represent the cumulative balance of periodic net income/loss,
dividend distributions and prior period adjustments, if any.
Other components of equity include the following:
* consolidation reserve - comprises differences in the valuation bases and
post-acquisition reserves of investment in subsidiaries.
* translation reserve - comprises foreign currency translation differences
arising from the translation of financial statements of the Group's foreign
entities into the reporting currency.
2) SIGNIFICANT ACCOUNTING POLICIES (Cont'd)
j) Income and expense recognition
In relation to the rendering of professional services, the Group recognises fee
income as time is expended and costs are incurred, provided the amount of
consideration to be received is reasonably determinable and there is reasonable
expectation of its ultimate collection.
Rental income arising from operating leases on investment property is
recognised in the consolidated statement of comprehensive income on a straight
line basis over the term of the lease.
Interest income is recognised in the consolidated statement of comprehensive
income as it accrues.
All expenses are recognised in the consolidated statement of comprehensive
income on the accrual basis.
k) Impairment
The Group's assets are tested for impairment whenever events or changes in
circumstances indicate that the carrying amount may not be recoverable. An
impairment loss is recognised for the amount by which the asset's carrying
amount exceeds its recoverable amount. The recoverable amount is the higher of
an asset's fair value less costs of disposal and value in use. For the purposes
of assessing impairment, assets are grouped at the lowest levels for which
there are separately identifiable cash inflows which are largely independent of
the cash inflows from other assets or groups of assets (cash-generating units).
Non-financial assets other than goodwill that suffered an impairment are
reviewed for possible reversal of the impairment at the end of each reporting
period.
If in a subsequent period, the amount of an impairment loss decreases and the
decrease can be linked objectively to an event occurring after the write-down,
the write-down is reversed through the consolidated statement of comprehensive
income.
An impairment is reversed only to the extent that the asset's carrying amount
does not exceed the carrying amount that would have been determined, net of
depreciation or amortisation, if no impairment loss had been recognised.
l) Offsetting
Financial assets and liabilities are offset and the net amount is reported in
the consolidated statement of financial position whenever the Group has a
legally enforceable right to set off the recognised amounts and there is an
intention to settle on a net basis or realise the asset and settle the
liability simultaneously.
m) Foreign currency transactions
Functional and presentation currency
Items included in the financial statements of each of the Group's entities are
measured using the functional currency of the primary economic environment in
which the entity operates.
The subsidiaries' functional currencies are disclosed in note 1 to the
financial statements. The consolidated financial statements are presented in
U.S. Dollars, rounded off to the nearest dollar.
2) SIGNIFICANT ACCOUNTING POLICIES (Cont'd)
m) Foreign currency transactions (Cont'd)
Transactions and balances
Foreign currency transactions are converted into U.S. Dollars using the
exchange rates at the dates of the transactions. Foreign exchange gains and
losses resulting from the settlement of such transactions, and from the
translation of monetary assets and liabilities denominated in foreign
currencies at year end exchange rates, are generally recognised in profit or
loss. They are deferred in equity if they relate to qualifying cash flow hedges
and qualifying net investment hedges or are attributable to part of the net
investment in a foreign operation.
Transactions and balances (Cont'd)
Foreign exchange gains and losses that relate to borrowings are presented in
the consolidated statement of comprehensive income, within finance costs. All
other foreign exchange gains and losses are presented in the consolidated
statement of comprehensive income on a net basis within other gains/(losses).
Non-monetary items that are measured at fair value in a foreign currency are
translated using the exchange rates at the date when the fair value was
determined. Translation differences on assets and liabilities carried at fair
value are reported as part of the fair value gain or loss.
Foreign operations
The results and financial position of foreign operations (none of which has the
currency of a hyperinflationary economy) that have a functional currency
different from the presentation currency are translated into the presentation
currency as follows:
* assets and liabilities for each statement of financial position presented
are translated at the closing rate at the date of that balance sheet;
* income and expenses for each statement of comprehensive income are
translated at average exchange rates (unless this is not a reasonable
approximation of the cumulative effect of the rates prevailing on the
transaction dates, in which case income and expenses are translated at the
dates of the transactions); and,
* all resulting exchange differences are recognised in other comprehensive
income.
On consolidation, exchange differences arising from the translation of any net
investment in foreign entities, and of borrowings and other financial
instruments designated as hedges of such investments, are recognised in other
comprehensive income. When a foreign operation is sold or any borrowings
forming part of the net investment are repaid, the associated exchange
differences are reclassified to profit or loss, as part of the gain or loss on
sale.
Goodwill and fair value adjustments arising on the acquisition of a foreign
operation are treated as assets and liabilities of the foreign operation and
translated at the closing rate.
None of the foreign operations has the currency of a hyperinflationary economy.
2) SIGNIFICANT ACCOUNTING POLICIES (Cont'd)
m) Foreign currency transactions (Cont'd)
Translation reserve
Assets and liabilities of the Group's non-U.S. Dollar functional currency
subsidiaries are translated into U.S. Dollars at the closing exchange rates at
the reporting date. Revenues and expenses are translated at the average
exchange rates for the year. All cumulative differences from the translation
of the equity of foreign subsidiaries resulting from changes in exchange rates
are included in a separate caption within equity without affecting income.
n) Related parties
Related parties are individuals and entities where the individual or entity has
the ability, directly or indirectly, to control the other party or exercise
significant influence over the other party in making financial and operating
decisions.
o) Segment reporting
The Group's operating businesses are organised and managed separately according
to geographical area, with each segment representing a strategic business unit
that serves a different market. Financial information on business segments is
presented in note 12 of the consolidated financial statements.
p) Taxation
Taxation on net profit before taxation for the year comprises both current and
deferred tax.
Current tax is the expected income tax payable on the taxable income for the
year, using tax rates enacted or substantially enacted at the reporting date
and any adjustment to tax payable in respect of previous years in the countries
where the Parent Company and its subsidiaries operate and generate taxable
income.
The Group accounts for income taxes in accordance with IAS 12, "Income Taxes,"
which requires that a deferred tax liability be recognised for all taxable
temporary differences and a deferred tax asset be recognised for an
enterprise's deductible temporary differences, operating losses, and tax credit
carryforwards. A deferred tax asset or liability is measured using the
marginal tax rate that is expected to apply to the last dollars of taxable
income in future years. The effects of enacted changes in tax laws or rates
are recognised in the period that includes the enactment date.
q) Amended and newly issued accounting standards not yet adopted
A number of new standards, amendments to standards and interpretations are
effective for annual periods beginning after 1 March 2020, and have not been
adopted early in preparing these consolidated financial statements. None of
these are expected to have a significant effect on the consolidated financial
statements of the Group.
3) CHANGE IN ACCOUNTING POLICY AND DISCLOSURES
As discussed in notes 2(b) and 2(f), the Group voluntarily changed its
accounting policy in measuring investment property under IAS 40 from the cost
model to the fair value model.
3) CHANGE IN ACCOUNTING POLICY AND DISCLOSURES (Cont'd)
Under IAS 8, "Accounting Policies, Changes in Accounting Estimates and Errors"
("IAS 8"), an entity is permitted to change an accounting policy only if the
change:
* is required by an IFRS; or
* results in the consolidated financial statements providing reliable and
more relevant information about the effects of transactions, other events
or conditions on the Group's consolidated financial position, financial
performance or cash flows.
The Directors and Management believe that the fair value method of accounting
would provide reliable and more relevant information about the effects of
transactions, other events or conditions on the Group's financial position and
financial performance.
The nature and the impact of the change are described below:
Measurement
IAS 40 requires an entity that chooses the fair value model to measure all of
its investment property at fair value, except when the fair value cannot be
reliably measured. A gain or loss arising from a change in the fair value of
investment property shall be recognised in profit or loss for the period in
which it arises.
When measuring the fair value of investment property in accordance with IFRS
13, "Fair Value Measurement" ("IFRS 13"), an entity shall ensure that the fair
value reflects, among other things, rental income from current leases and other
assumptions that market participants would use when pricing investment property
under current market conditions. In determining the carrying amount of
investment property under the fair value model, an entity does not double?count
assets or liabilities that are recognised as separate assets or liabilities.
An entity that has measured an investment property at fair value shall continue
to measure the property at fair value until disposal (or until the property
becomes owner?occupied property or the entity begins to develop the property
for subsequent sale in the ordinary course of business) even if comparable
market transactions become less frequent or market prices become less readily
available.
Impact of change in measurement
In accordance with IAS 8, the measurement requirements using the fair value
model have been applied retrospectively. Adjustments were made on the opening
balance of retained earnings for the earliest prior period presented and the
other comparative amounts disclosed for each prior period are presented as if
the new accounting policy had always been applied.
The total impact on the Group's retained earnings as at 1 March 2020 and 2019
is as follows:
2020 2019
Closing retained earnings - 29/28 February 51,204 123,861
Revaluation surplus on investment property 240,619 240,619
Reversal of accumulated depreciation on investment 72,731 51,534
property
Opening restated retained earnings - 1 March $364,554 $416,014
Refer also to note 16.
4) FIXED ASSETS
Leasehold Office Vehicles Total
improvement equipment
Cost:
At 28 February 2021 20,281 43,580 55,392 119,253
Disposal - - - -
Additions - 1,106 - 1,106
At 31 August 2021 20,281 44,686 55,392 120,359
Depreciation:
At 28 February 2021 20,281 40,558 55,392 116,231
Disposal - - - -
Charge for 1 March - 31 - 1,228 1,228
August 2021
At 31 August 2021 20,281 41,786 55,392 117,459
Net book value:
At 31 August 2021 $- $2,900 $- $2,900
At 28 February 2021 $- $3,022 $- $3,022
5) INVESTMENT PROPERTY
2021 2020
Restated
Balance at 1 March 702,962 667,417
Effects of translations (51,175) 11,663
Balance at 31 August $651,787 $679,080
Investment property comprises condominium units at The Prime 11 Condominium in
Bangkok, Thailand. As at 31 August 2021, it had a fair value of THB 21,000,000
(2020: THB 21,000,000). Rental income arising from the investment property
during the year amounted to $0 (2020: $5,497).
6) FINANCIAL ASSETS AT FAIR VALUE THROUGH PROFIT OR LOSS
31-Aug-21 31-Aug-20
Investment in Phillip Investment $240,994 $228,979
Fund
The investment in Phillip Investment Fund in Singapore comprises 310,608.32
(2020: 310,608.32) units in Phillip Money Market Fund. The amount of investment
recognised in the consolidated statement of financial position is $240,994
(2020: $228,979), net of unrealised gain of $12,015 (2020: net of unrealised
loss of $1,323).
7) LOANS AND OTHER RECEIVABLES
On 8 February 2019, Meyer BVI entered into a Loan Agreement with MVT
Development Ltd. amounting to THB 16,000,000. The loan earn interest at a rate
of 15% per annum. The loan was secured and was guaranteed with a property in
Bangkok, Thailand.
The loan was due on 8 February 2020. However, MVT Development Ltd. was not able
to repay the loan on the due date. On 30 September 2020, MVT Development Ltd.
offered THB 15,500,000 as repayment in full including any interest outstanding.
The Directors accepted the lower cash offer, and as such the money is in a
separate bank account held on behalf of Meyer BVI by a Director. The lower cash
offer resulted in a loan write off of $128,313.
Interest income during the year amounted to $nil (2020: $38,197), of which $nil
was outstanding as at half year end (2020: $101,576).
8) RELATED PARTY TRANSACTIONS
The Group was charged $19,850 (2020: $21,746) in accounting fees by
Administration Outsourcing Co., Ltd, a company related by way of common
directorship, of which $3,328 (2020: $3,554) remained outstanding as at half
year end.
During the half year, the Group incurred directors' fees, inclusive of school
fees and accommodation allowance, amounting to $151,711 (2020: $172,101).
As at 31 August 2021, due from director amounted to $507,605 (2020: due to
director of $4,335). The amounts are unsecured, interest-free and repayable on
demand.
9) SHARE CAPITAL AND TREASURY SHARES
Share capital
Authorised
The Parent Company is authorised to issue an unlimited number of no par value
shares of a single class.
2021 2020
Issued and fully paid
11,433,433 (2020: 11,433,433) shares of no par $913,496 $913,496
value per share.
Each share of the Parent Company confers upon the shareholder:
a) the right to one vote on any resolution of shareholders;
b) the right to an equal share in any dividend paid by the Parent Company;
and
c) the right to an equal share in the distribution of the surplus assets
of the Parent Company on its liquidation.
9) SHARE CAPITAL AND TREASURY SHARES (Cont'd)
Treasury Shares
On 26 September 2018, the Parent Company entered into a Settlement Agreement
with the appropriate parties and agreed to settle on a full and final basis all
claims, disputes and differences with regard to the unauthorised transfer of
shares in Ray Alliance Financial Advisers Pte Ltd ("Ray Alliance"), investment
in private equity of the Parent Company in the prior years.
The following was agreed by the parties under the Settlement Agreement:
a) the Group consented and ratified the transfer of Ray Alliance shares;
b) return of 322,000 shares of the Parent Company previously issued as
consideration for the Ray Alliance shares;
c) payment of SGD 350,000 to the Parent Company for claims on costs and
damages.
Treasury shares recognised by the Group for the return of the Parent Company's
shares amounted to $318,162 (2020: $318,162).
10) TAXATION
There is no mainstream taxation in the British Virgin Islands. The Parent
Company and Meyer BVI are not subject to any forms of taxation in the British
Virgin Islands, including income, capital gains and withholding taxes.
Meyer Thailand and Prime RE are subject to Thailand graduated statutory income
tax at a rate of 0-15% (2020: 0-15%) on profit before tax.
The current tax expense included in the consolidated statement of comprehensive
income was $nil (2020 : $nil).
The Group had no deferred tax assets or liabilities as at the reporting date.
11) EARNINGS PER SHARE
a) Basic
Basic earnings per share is calculated by dividing the profit attributable to
equity holders of the Parent Company by the weighted average number of shares
in issue during the year, excluding treasury shares.
31-Aug-21 31-Aug-20
Restated
Earnings attributable to equity holders of the $123,067 $116,774
Parent Company
Weighted average number of shares in issue 11,433,433 11,433,433
Adjusted for weighted average number of:
- treasury shares (322,000) (322,000)
Weighted average number of shares in issue and 11,111,433 11,111,433
for basic earnings for share
Basic earnings per share $0.01108 $0.01051
11) EARNINGS PER SHARE (Cont'd)
b) Diluted
Diluted earnings per share is calculated by adjusting the weighted average
number of shares outstanding to assume conversion of all dilutive potential
shares. As at 31 August 2021 and 31 August 2020, the Parent Company had no
share warrants or share options as potential dilutive shares. For the share
options and warrants, if any, a calculation is done to determine the number of
shares that could have been acquired at fair value based on the monetary value
of the subscription rights attached to outstanding share options and warrants.
The number of shares calculated is compared with the number of shares that
would have been issued assuming the exercise of the share options and warrants.
31-Aug-21 31-Aug-20
Restated
Earnings attributable to equity holders of the $123,067 $116,774
Parent Company
Weighted average number of shares 11,111,433 11,111,433
in issue and for diluted earnings
for share
Diluted earnings per share $0.01108 $0.01051
12) SEGMENTAL INFORMATION
The Group has two reportable segments based on geographical areas where the
Group operates and these were as follows:
British Virgin Islands ("BVI") - where the Parent Company and Meyer BVI are
domiciled. The Parent Company serves as the investment holding company of the
Group and Meyer BVI provides wealth management and advisory services.
Thailand - where Meyer Thailand is domiciled and provides marketing and
economic consulting services to the Group and where Prime RE is domiciled and
provides property rental services.
The reportable segmental revenue, other profit and loss disclosures, assets and
liabilities were as follows:
Revenue
31-Aug-21 31-Aug-20
Restated
Total Inter-segment Revenue Total Inter-segment Revenue
segment revenue from segment revenue from
revenue external revenue external
customers customers
BVI 936,688 - 936,688 883,596 - 883,596
Thailand 101,715 (98,290) 3,425 108,137 (97,650) 10,487
Total $1,038,403 $(98,290) $940,113 $991,733 $(97,650) $894,083
The revenue between segments is carried out at arm's length. Revenues from two
customers of the BVI segment represent approximately 48% (2020: 60%) of the
Group's total revenues.
12) SEGMENTAL INFORMATION (Cont'd)
Other profit and loss disclosures
31-Aug-21 31-Aug-20
Restated
Commission Depreciation Income tax Commission Depreciation Income tax
expense expense
BVI 416,702 771 - 471,964 732 -
Thailand 1,804 457 - 1,880 822 -
Total $418,506 $1,228 $- $473,844 $1,554 $-
Assets
31-Aug-21 31-Aug-20
Restated
Total Assets Total Assets
BVI 2,268,275 1,925,085
Thailand 722,861 799,294
Total $2,991,136 $2,724,379
Intersegment assets amounting to $1,071,593 (2020 : $873,850) were already
eliminated in the total assets per segment above.
Liabilities
31-Aug-21 31-Aug-20
Restated
Total Total
Liabilities Liabilities
BVI 1,269,618 1,133,073
Thailand 21,088 73,767
Total $1,290,706 $1,206,840
Intersegment liabilities amounting to $948,568 (2020 : $748,174) were already
eliminated in the total liabilities per segment above.
13) FINANCIAL INSTRUMENTS AND ASSOCIATED RISKS
Financial assets of the Group include cash and cash equivalents, trade
receivables, financial assets at fair value through profit or loss, due from
director and loans and other receivables. Financial liabilities include trade
payables, due to director and other payables and accrued expenses. Accounting
policies for financial instruments are set out in note 2.
The Group has exposure to a variety of financial risks that are associated with
these financial instruments. The most important types of financial risk to
which the Group is exposed are market risk, credit risk and liquidity risk.
13) FINANCIAL INSTRUMENTS AND ASSOCIATED RISKS (Cont'd)
The Group's overall risk management program is established to identify and
analyse this risk, to set appropriate risk limits and controls, and to monitor
risks and adherence to limits in an effort to minimise potential adverse
effects on the Group's financial performance.
a) Market risk
Market risk is the risk that the fair value or future cash flows of a financial
instrument will fluctuate as a result of market factors which includes interest
rate risk and currency risk.
Interest rate risk
The financial instruments exposed to interest rate risk comprise cash and cash
equivalents.
The Group is exposed to interest rate cash flow risk on cash and cash
equivalents, which earn interest at floating interest rates that are reset as
market rates change. The Group is exposed to interest rate risk to the extent
that these interest rates may fluctuate.
A sensitivity analysis was performed with respect to the interest-bearing
financial instruments with exposure to fluctuations in interest rates and
management noted that there would be no material effect to shareholders' equity
or net income for the year.
Currency risk
The Group may invest in financial instruments and enter into transactions
denominated in currencies other than its functional currency. Consequently,
the Group is exposed to risk that the exchange rate of its currency relative to
other foreign currencies may change in a manner that has an adverse affect on
the value of that portion of the Group's assets or liabilities denominated in
currencies other than the U.S. Dollar.
The Group's total net exposure to fluctuations in foreign currency exchange
rates at the reporting date stated in U.S. Dollars was as follows:
31-Aug-21 31-Aug-20 Restated
Fair value % of net Fair value % of net
assets assets
Assets
Thailand Baht $703,027 41.34% $1,235,669 81.43%
Japanese Yen $883,303 51.95% $645,666 42.55%
Singaporean Dollar $240,994 14.17% $228,979 15.09%
Euro $26,058 1.53% $88,071 5.80%
United Kingdom $9,620 0.57% $36,347 2.40%
Pound
$1,863,002 109.56% $2,234,733 147.26%
13) FINANCIAL INSTRUMENTS AND ASSOCIATED RISKS (Cont'd)
a) Market risk (Cont'd)
Currency risk (Cont'd)
The table below summarises the sensitivity of the net assets to changes in
foreign exchange movements at 31 August 2021 and 2020. The analysis is based
on the assumption that the relevant foreign exchange rate increased/decreased
against the U.S. Dollar by the percentages disclosed in the table below, with
all other variables held constant. This represents management's best estimate
of a reasonable possible shift in the foreign exchange rates, having regard to
historical volatility of those rates.
31-Aug-21 31-Aug-20 Restated
Possible Possible Possible Possible
shift in shift in shift in shift in
rate amount rate amount
Thailand Baht 3.66% $25,731 2.32% $28,668
Japanese Yen 1.81% $15,988 2.58% $16,658
Singaporean Dollar 4.83% $11,640 1.49% $3,412
Euro 3.40% $886 1.20% $1,057
United Kingdom 5.14% $494 3.04% $1,105
Pound
$ $
54,739 50,899
b) Credit risk
Credit risk represents the accounting loss that would be recognised at the
reporting date if financial instrument counterparties failed to perform as
contracted.
As at 31 August 2021 and 2020, the Group's financial assets exposed to credit
risk amounted to the following:
31-Aug-21 31-Aug-20
Cash and cash equivalents 1,363,101 897,696
Trade receivables(net of allowance for 104,135 113,354
doubtful
accounts of $8,572 (2020: $8,572)
Financial assets at fair value through 240,994 228,979
profit or loss
Due from director 507,605 -
Loans and other receivables 63,251 709,264
$2,279,086 $1,949,293
i) Risk management
The extent of the Group's exposure to credit risk in respect of these financial
assets approximates their carrying values as recorded in the Group's
consolidated statement of financial position.
13) FINANCIAL INSTRUMENTS AND ASSOCIATED RISKS (Cont'd)
b) Credit risk (Cont'd)
i) Risk management (Cont'd)
The Group invests all its available cash and cash equivalents in several
banks. The Group is exposed to credit risk to the extent that these banks may
be unable to repay amounts owed. To manage the level of credit risk, the Group
attempts to deal with banks of good credit standing, whenever possible.
The Group's exposure to credit risk is influenced mainly by the individual
characteristics of each customer. To reduce exposure to credit risk, the Group
may perform ongoing credit evaluations on the financial condition of its
customers, but generally does not require collateral. The Group has
significant exposure to a small number of customers, the two largest owing
$25,060 (2020: $34,699) as at half year end, which represents 22% (2020: 28%)
of gross trade receivables. The Group is exposed to credit-related losses in
the event of non-performance by these customers. The exposure to credit risk is
reduced as these customers have a good working relationship with the Group and
management does not expect any significant customer to fail to meet its
obligations.
The Group is exposed to credit risk with respect to its investments.
Bankruptcy or insolvency of the investee companies may cause the Group's rights
to the security to be delayed or become limited.
The ageing of the Group's gross trade receivables as at year end is as follows:
31-Aug-21 31-Aug-20
1 - 90 days 104,077 111,075
Over 90 days 8,630 10,851
Allowance for doubtful (8,572) (8,572)
$104,135 $113,354
ii) Security
For some trade receivables, the Group may obtain security in the form of
guarantees, deeds of undertaking or letters of credit which can be called upon
if the counterparty is in default under the terms of their agreement.
iii) Impairment of financial assets
The Group applies the IFRS 9 general approach to measuring ECL based on the
full three-stage model.
The Group determined the ECL based on probability-weighted outcome, the time
value of money and reasonable and supportable information that is available
without undue cost or effort at the reporting date about past events, current
conditions and forecast of future economic conditions. The assessment also
considered borrower specific information.
13) FINANCIAL INSTRUMENTS AND ASSOCIATED RISKS (Cont'd)
b) Credit risk (Cont'd)
iii) Impairment of financial assets (Cont'd)
To measure the expected credit losses, trade receivables have been grouped
based on shared credit risk characteristics and the days past due.
The expected loss rates are based on the payment profiles of revenues over a
period of 36 months before 31 August 2021 and 2020, respectively, and the
corresponding historical credit losses experienced within this period. The
historical loss rates are adjusted to reflect current and forward-looking
information on macroeconomic factors affecting the ability of the customers to
settle the receivables.
On that basis, the loss allowance as at 31 August 2021 and 2020 were determined
as follows:
Expected
Balance at Credit Loss Allowance
at
31-Aug-21 Loss Rate 31-Aug-21
Trade receivables $112,707 7.61% $8,572
Expected
Balance at Credit Loss Allowance
at
31-Aug-20 Loss Rate 31-Aug-20
Trade receivables $121,926 7.03% $8,572
The closing loss allowances for trade receivables as at 31 August 2021 and 2020
reconcile to the opening loss allowances as follows:
31-Aug-21 31-Aug-20
Opening balance 8,572 8,572
Increase/(decrease) in loss - -
allowance
Closing balance $8,572 $8,572
Trade receivables are written off when there is no reasonable expectation of
recovery. Indicators that there is no reasonable expectation of recovery
include, amongst others, the failure of a debtor to engage in a repayment plan
with the Group, and a failure to make contractual payments for a period of
greater than 365 days past due.
Impairment losses on trade receivables are presented as net impairment losses
within operating profit. Subsequent recoveries of amounts previously written
off are credited against the same line item.
While cash and cash equivalents, due from director and loans and other
receivables are also subject to the impairment requirements of IFRS 9, the
identified impairment loss was immaterial.
13) FINANCIAL INSTRUMENTS AND ASSOCIATED RISKS (Cont'd)
c) Liquidity risk
Liquidity risk is the risk that the Group will not be able to meet its
financial obligations as they fall due. The Group's approach to managing
liquidity is to ensure, as far as possible, that it will always have sufficient
liquidity to meet its liabilities when due, under both normal and stressed
conditions, without incurring unacceptable losses or risking damage to the
Group's reputation. Typically, the Group ensures that it has sufficient cash
on demand to meet expected operational needs as they arise.
All of the Group's financial liabilities are expected to be settled within a
year from the reporting date.
14) FAIR VALUE INFORMATION
The fair value of assets and liabilities in active markets is based on quoted
market prices on the reporting date.
An active market is a market in which transactions for the asset or liability
take place with sufficient frequency and volume to provide pricing information
on an ongoing basis.
The fair value hierarchy has the following levels:
* Level 1 inputs are quoted prices (unadjusted) in active markets for
identical assets or liabilities that the entity can access at the
measurement date.
* Level 2 inputs are inputs other than quoted prices included within Level 1
that are observable for the asset or liability, either directly or
indirectly.
* Level 3 inputs are unobservable inputs for the asset or liability.
The level in the fair value hierarchy within which the fair value measurement
is categorised in its entirety is determined on the basis of the lowest level
of input that is significant to the fair value measurement in its entirety.
For this purpose, the significance of an input is assessed against the fair
value measurement in its entirety. If a fair value measurement uses observable
inputs that require significant adjustment based on unobservable inputs, that
measurement is a Level 3 measurement. Assessing the significance of a
particular input to the fair value measurement in its entirety requires
judgment, considering factors specific to the asset or liability.
The determination of what constitutes 'observable' requires significant
judgment by the Group. The Group considers observable data to be that market
data that is readily available, regularly distributed or updated, reliable and
verifiable, not proprietary, and provided by independent sources that are
actively involved in the relevant market.
Financial assets and financial liabilities
The Group's financial assets at fair value through profit or loss comprise an
investment in a fund.
For certain of the Group's financial instruments, not carried at fair value,
including cash and cash equivalents, trade receivables, loans and other
receivables, trade payables and other payables and accrued expenses, the
carrying amounts approximate fair value due to the immediate or short-term
nature of these financial instruments. The carrying value of the amounts due
from/to director approximates its fair value, since such amounts are repayable
on demand.
14) FAIR VALUE INFORMATION (Cont'd)
Financial assets and financial liabilities (Cont'd)
Investments whose values are based on quoted market prices in active markets
are therefore classified within Level 1.
Financial instruments that trade in markets that are not considered to be
active but are valued based on quoted market prices, dealer quotations or
alternative pricing sources supported by observable inputs are classified
within Level 2 and for the Group includes the investment in fund. As Level 2
investments include positions that are not traded in active markets and/or are
subject to transfer restrictions, valuations may be adjusted to reflect
illiquidity and/or non-transferability, which are generally based on available
market information.
Investments classified within Level 3 have significant unobservable inputs, as
they trade infrequently.
The following table shows the carrying amounts and fair values of financial
assets and financial liabilities, including their levels in the fair value
hierarchy at 31 August 2021 and 2020. It does not include fair value
information for financial assets and financial liabilities not measured at fair
value if the carrying amount is a reasonable approximation of fair value.
2021 2020
Financial assets - Level 2
Financial assets at fair value through profit or $240,994 $228,979
loss
The Group did not hold any investments under the Levels 1 and 3 hierarchies as
at 31 August 2021 and 2020.
There were no significant investments transferred between Levels 1, 2 and 3.
Non-financial assets
As discussed in note 2(c), the Group obtains independent valuations for its
investment property at least annually. At the end of each reporting period, the
Directors update their assessment of the fair value, taking into account the
most recent independent valuations. The Directors determine a property's value
within a range of reasonable fair value estimates. The best evidence of fair
value is current prices in an active market for similar properties.
The Group engages an external, independent and qualified appraiser to determine
the fair value of investment property at least annually at the end of each
reporting period. As at 28 February 2021 and 29 February 2020, the fair value
of investment property has been determined by American Appraisal (Thailand)
Ltd. The last independent valuation report of the investment property was dated
15 June 2021.
The fair value estimates for investment property are included in Level 2 and
have been derived using the sales comparison approach. The key inputs under
this approach are the price per square metre from recent sales and listings of
comparable properties in the area (location and size). Adjustments were made
for the differences between the Group's investment property and the recent
sales and listings of properties regarded as comparable.
14) FAIR VALUE INFORMATION (Cont'd)
Non-financial assets (Cont'd)
The following table shows the carrying amounts and fair values of non-financial
assets, including their levels in the fair value hierarchy at 31 August 2021
and 2020:
2021 2020
Non-financial assets - Level 2
Investment property $651,787 $679,080
The Group did not hold any non-financial assets measured at fair value under
the Levels 1 and 3 hierarchies as at 31 August 2021 and 2020.
There were no significant investments transferred between Levels 1, 2 and 3.
15) CAPITAL RISK MANAGEMENT
The Group's objectives when managing capital are:
* to safeguard the Group's ability to continue as a going concern; and
* to provide adequate returns to its shareholders.
In order to maintain or balance its overall capital structure to meet its
objectives, the Group is continually monitoring the level of share issuance and
any dividend declaration and distributions to shareholders in the future.
16) RESTATEMENT DUE TO VOLUNTARY CHANGE IN ACCOUNTING POLICY
As discussed in notes 2(b), 2(f) and 3, the Group voluntarily changed its
accounting policy in measuring investment property under IAS 40 from the cost
model to the fair value model. In accordance with IAS 8, the Group accounted
for the change in accounting policy retrospectively and this change, when
applied consistently to 2021 and 2020, had the following impact on the Group's
consolidated financial statements:
Consolidated Statement of Financial Position
2021 2020
Investment property
Balance at 1 March, as restated/previously reported 667,417 355,236
Prior period adjustment - 313,350
Effects of translation 35,545 ( 1,169)
Balance at 28/29 February, as restated $702,962 $667,417
16) RESTATEMENT DUE TO VOLUNTARY CHANGE IN ACCOUNTING POLICY (Cont'd)
Consolidated Statement of Financial Position
(Cont'd)
2021 2020
Translation reserve
Balance at 1 March, as restated/previously reported 27,653 28,822
Transactions during the year 22,191 -
Prior period adjustment - ( 1,169)
Balance at 28/29 February, as restated $49,844 $27,653
Retained earnings
Balance at 1 March, as restated/previously reported 364,554 51,204
Transactions during the year 193,507 -
Prior period adjustment - 313,350
Balance at 28/29 February, as restated $558,061 $364,554
Consolidated Statement of Comprehensive Income
2021 2020
Depreciation expense
Balance for the year ended 28/29 February, as 4,377 33,114
reported
Prior period adjustment - (21,197)
Balance for the year ended 28/29 February, as $4,377 $11,917
reported/restated
END
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