TIDMAWLP
FOR IMMEDIATE RELEASE 1
December 2022
Asia Wealth Group Holdings Limited
("Asia Wealth", the "Group" or the "Company")
UNAUDITED INTERIM RESULTS
FOR THE SIX MONTHSED 31 AUGUST 2022
The Board is pleased to report the unaudited interim results of Asia Wealth
Group Holdings Limited ("Accounts") for the period from 1 March 2022 to 31
August 2022. 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 2022 include:
* Consolidated revenue of US$843,863 (2021: US$940,113)
* Gross profit for Meyer Group of US$405,506 (representing a gross margin of
48%) (2021: US$529,130 and 56%)
* Cash at bank and on hand of US$1,187,226 at 31 August 2022 (2021:
$1,363,101).
The Group reports a loss after tax of US$182,567 on sales of US$843,863 for the
six months ended 31 August 2022. These sales were principally generated by the
Company's wholly owned subsidiary, Meyer Asset Management Ltd., BVI. This
result was principally caused by unrealised exchange losses on a weak Yen.
Cash balance has decreased by US$29,531 and net assets by US$224,576,
respectively, since 1st March 2022 again due to exposure to a weak Yen.
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 2022
Expressed in U.S. Dollars
Note(s) 31-Aug-22 31-Aug-21
Non-current assets
Fixed assets 3 3,948 2,900
Investment property 4,13 578,250 651,787
582,198 654,687
Current assets
Cash and cash equivalents 1,187,226 1,363,101
Trade receivables 127,427 104,135
Financial assets at fair value 5 283,324 240,994
through profit or loss
Loans and other receivables 6 56,434 63,251
Due from director 7 464,359 507,605
Prepaid tax 650 562
Prepayments and other assets 48,048 56,801
2,167,468 2,336,449
Total assets $ 2,749,666 $ 2,991,136
Equity
Share capital 8 913,496 913,496
Treasury shares 8 (318,162) (318,162)
Consolidation reserve 405,997 405,997
Translation reserve (26,008) 17,971
Retained earnings 386,760 681,128
Total equity 1,362,083 1,700,430
Current liabilities
Trade payables 1,346,464 1,252,926
Other payables and accrued expenses 7 41,119 37,780
Total liabilities 1,387,583 1,290,706
Total equity and liabilities $ 2,749,666 $ 2,991,136
ASIA WEALTH GROUP HOLDINGS LIMITED
Consolidated Statement of Comprehensive Income
For the half year ended 31 August 2022
Expressed in U.S. Dollars
Note(s) Mar - Aug Mar - Aug
2022 2021
Revenue
Commission income 843,863 940,113
843,863 940,113
Expenses
Commission expense 438,297 418,506
Directors' fees 7 170,661 151,711
Professional fees 7 127,054 132,372
Salaries and wages 30,271 30,138
Office expenses 23,786 24,012
Rent 8,045 9,068
Travel and entertainment 27,237 6,832
Marketing 3,914 3,234
Impairment losses - -
Depreciation 3,13 871 1,228
Other expenses 5,494 4,771
835,630 781,872
Net profit/(loss) from operations 8,233 158,241
Other income/(expenses)
Foreign currency exchange gain/ (197,409) (52,948)
(loss)
Other income 6,609 17,774
(190,800) (35,174)
Net profit/(loss) before taxation (182,567) 123,067
Taxation 9 - -
Total comprehensive income/(loss) $ (182,567) $ 123,067
Total comprehensive income/(loss)
attributable to
equity holders of the Parent Company $ (182,567) $ 123,067
Earnings per share attributable to the equity holders of the
Parent Company :
Basic earnings per share 10 $ (0.01643) 0.01108
Diluted earnings per share 10 $ (0.01643) 0.01108
ASIA WEALTH GROUP HOLDINGS LIMITED
Consolidated Statement of Changes in Equity
For the half year ended 31 August 2022
Expressed in U.S. Dollars
Attributable to Equity Holders of the Parent Company
Share Capital Treasury Consolidation Translation Retained Equity
Shares Reserve Reserve Earnings
Number US$
Balances at beginning of 1 Mar 2022 11,433,433 913,496 (318,162) 405,997 16,001 569,327 1,586,659
Translation differences - - - (42,009) - (42,009)
Total comprehensive income - - - - (182,567) (182,567)
Balances at end of 31 Aug 2022 11,433,433 $913,496 $(318,162) $405,997 $(26,008) $386,760 $1,362,083
Attributable to Equity Holders of the Parent Company
Share Capital Treasury Consolidation Translation Retained Equity
Shares Reserve Reserve Earnings
Number US$
Balances at beginning of 1 Mar 2021 11,433,433 913,496 (318,162) 405,997 49,844 558,061 1,609,236
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
ASIA WEALTH GROUP HOLDINGS LIMITED
Consolidated Statement of Cash Flows
For the half year ended 31 August 2022
Expressed in U.S. Dollars
Mar - Aug Mar - Aug
2022 2021
Operating activities
Total comprehensive income/(Loss) (182,567) 123,067
Adjustments for:
Depreciation 871 1,228
Unrealised (gain)/loss on investment 66,693 51,175
property
Foreign currency exchange (gain)/loss (42,009) (31,873)
Operating income/(loss) before changes in operating (157,012) 143,597
assets and liabilities
Changes in operating assets and
liabilities:
Trade receivables (7,375) 22,065
Loan and other receivable 6,182 (35,339)
Prepaid tax (202) (307)
Prepayments and other assets 19,229 70,041
Trade payables 121,385 17,729
Tax payable - (140)
Other Payables and Accrued Expenses (11,889) (20,158)
Net cash flows from/(used in) operating (29,682) 197,488
activities
Investing activities
Acquisition of fixed assets (618) (1,106)
Cash flows from/(used in) investing (618) (1,106)
activities
Financing activities
Net advances from/(to) related party 769 (31)
Cash flows from/(used in) financing 769 (31)
activities
Net increase/(decrease) in cash and cash (29,531) 196,351
equivalents
Cash and cash equivalents at beginning of 1,216,757 1,166,750
year
Cash and cash equivalents at end of period $ 1,187,226 $ 1,363,101
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 2022
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 26 September 2022.
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. In March 2020, the U.K. Financial Conduct
Authority approved the acquisition of NEX Exchange Limited by Aquis Exchange
PLC. Consequently, NEX Exchange changed its name to Aquis Stock Exchange
("AQSE"). The Parent Company's shares were automatically listed to AQSE.
The Parent Company has the following subsidiaries as at 31 August 2022 and 31
August 2021:
Incorporation Country of Functional Ownership
Date Incorporation Currency Interest
2022 2021
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")
Nihon Wealth 2016 Thailand Thailand 49.00% 49.00%
Management Company Baht
Limited (formerly
Prime RE Limited)
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 Nihon Wealth Management
Company Limited.
On 20 October 2016, 51.00% of Meyer Thailand, owned beneficially via a trust
agreement in favour of Meyer BVI, was acquired by Nihon Wealth Management
Company Limited.
Therefore the Parent Company is the indirect owner of 51.00% of the outstanding
shares of Nihon Wealth Management Company Limited and Meyer Thailand, and
accordingly the Parent 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. The accounting policies
have been consistently applied by the Group and are consistent with those used
in the previous year, unless otherwise stated.
a) Basis of preparation
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.
Historical cost convention
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 presented and maintained in
U.S. Dollars, rounded to the nearest dollar.
New and amended standards
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 2021
that would be expected to have a material impact on the Group's consolidated
financial statements.
A number of new standards, amendments to standards and interpretations are
effective for annual periods beginning after 1 March 2021, 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.
b) Critical estimates and judgments
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.
2) SIGNIFICANT ACCOUNTING POLICIES (Cont'd)
b) Critical estimates and judgments (Cont'd)
Judgment 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.
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.
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.
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.
2) SIGNIFICANT ACCOUNTING POLICIES (Cont'd)
b) Critical estimates and judgments (Cont'd)
Estimating the useful lives of fixed assets
The useful lives of the Group's fixed assets are estimated based on
the period which they are expected to be available for use. The estimated
useful lives of fixed assets are reviewed and updated if expectations differ
materially from previous estimates.
c) 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 2022.
Details of the Group are set out in note 1.
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.
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.
Non-controlling interests in the results and equity of subsidiaries are shown
separately in the consolidated financial statements.
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.
2) SIGNIFICANT ACCOUNTING POLICIES (Cont'd)
c) Principles of consolidation (Cont'd)
Acquisitions (Cont'd)
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
acquired entity's net identifiable assets.
The excess of the consideration transferred, the amount of any non-controlling
interest in the acquired entity and the acquisition-date fair value of any
previous equity interest in the acquired entity over the fair value of the net
identifiable assets acquired is recorded as goodwill. If these investments are
less than the fair value of the net identifiable assets of the business
acquired, the difference is recognised directly in profit or loss as a bargain
purchase.
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.
d) Fixed assets
Fixed assets are stated at historical cost less accumulated depreciation and
impairment loss, if any.
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.
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%
2) SIGNIFICANT ACCOUNTING POLICIES (Cont'd)
e) Investment property
Investment property is held for long-term rental yields or for capital
appreciation or both, and is not occupied by the Group.
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.
Subsequent to initial recognition, investment property is stated at fair value.
Gains or losses arising from changes in the fair value 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.
f) 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.
2) SIGNIFICANT ACCOUNTING POLICIES (Cont'd)
g) Other financial assets
i) Classification
The Group classifies its financial assets 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.
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.
As at 31 August 2022, this comprised an investment in a fund and investment in
private equity.
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. The Group's debt instruments include trade
receivables, due from director and loans and other receivables.
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.
2) SIGNIFICANT ACCOUNTING POLICIES (Cont'd)
g) Other financial assets (Cont'd)
ii) Recognition, derecognition and measurement (Cont'd)
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.
* 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.
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.
2) SIGNIFICANT ACCOUNTING POLICIES (Cont'd)
g) Other financial assets (Cont'd)
iii) Fair value estimation (Cont'd)
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.
* 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.
2) SIGNIFICANT ACCOUNTING POLICIES (Cont'd)
h) Financial liabilities at amortised cost
Financial liabilities are non-derivative contractual obligations to
deliver cash or another financial asset to another entity and comprise trade
payables and other payables and accrued expenses.
These financial liabilities are initially recognised at fair value the
date the Company becomes a party to the contractual provisions of an instrument
and are subsequently measured at amortised cost using the effective interest
method.
Financial liabilities are derecognised when the obligation specified
in a contract is discharged, cancelled, or expired.
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.
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 using the effective interest method.
2) SIGNIFICANT ACCOUNTING POLICIES (Cont'd)
j) Income and expense recognition (Cont'd)
All expenses are recognised in the consolidated statement of comprehensive
income on the accrual basis.
k) Leases
The Group assessed and applied the short-term lease recognition
exemption under IFRS 16, "Leases". Lease payments are recognised in the
consolidated statement of comprehensive income on a straight-line basis over
the term of the lease.
l) Impairment
The Group's other 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.
m) 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.
n) 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.
2) SIGNIFICANT ACCOUNTING POLICIES (Cont'd)
n) Foreign currency transactions (Cont'd)
Functional and presentation currency (Cont'd)
The subsidiaries' functional currencies are disclosed in note 1 to the
financial statements. The consolidated financial statements are presented in
U.S. Dollars, rounded to the nearest dollar.
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.
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.
Group companies
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)
n) 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.
o) 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.
p) 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 11 of the consolidated financial statements.
q) 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
carry-forwards. 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.
3) FIXED ASSETS
Leasehold Office Vehicles Total
improvement equipment
Cost:
At 28 February 2022 20,281 55,392
44,788 120,461
Additions
- 618 - 618
At 31 August 2022 20,281 55,392
45,406 121,079
Depreciation:
At 28 February 2022 20,281 55,392
40,587 116,260
Charge for 1 March - 31
August 2022 - 871 871
At 31 August 2022 20,281 55,392
41,458 117,131
Net book value:
At 31 August 2022 $ $ $ $
- 3,948 - 3,948
At 28 February 2022 $ $ $ $
- 4,201 - 4,201
4) INVESTMENT PROPERTY
2022 2021
Balance at 1 March 644,943 702,962
Effects of translations (66,693) (51,175)
Balance at 31 August $ $
578,250 651,787
Investment property comprises condominium units at The Prime 11 Condominium in
Bangkok, Thailand. As at 31 August 2022, it had a fair value of THB 21,000,000
(2021: THB 21,000,000). Rental income arising from the investment property
during the year amounted to $nil (2021: $nil).
5) FINANCIAL ASSETS AT FAIR VALUE THROUGH PROFIT OR LOSS
31-Aug-22 31-Aug-21
Investment in Phillip Investment 240,994
Fund 237,425
Investment in private equity
45,899 -
$ $ 240,994
283,324
On 25 August 2021, the Company acquired 180,000 Class A Common Shares of BRM
Agri Cambodia Limited, a company incorporated in Canada.
The investment in Philip Investment Fund in Singapore comprises 310,608.32
(2021: 310,608.32) units in Philip Money Market Fund. The amount of investment
recognised in the consolidated statement of financial position is $237,425
(2021: $240,994), net of unrealised loss of $3,569 (2021: net of unrealised
gain of $12,015).
6) LOANS AND OTHER RECEIVABLES
On 24 August 2021, Meyer Thailand entered into a Loan Agreement with First Aid
Training Bangkok Co. Ltd. ("FATB") amounting to THB 1,500,000. The loan earns
interest at a rate of 1% per annum.
The loan is due on 24 August 2023 and secured by 100% of FATB's shares. The
loan was issued by Meyer BVI on behalf of Meyer Thailand. The related
intercompany balances were eliminated during consolidation.
On 8 February 2019, Meyer BVI entered into a Loan Agreement with MVT
Development Ltd. amounting to THB 16,000,000. The loan earnt 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 2021. However, MVT Development Ltd. was not able
to repay the loan on the due date. On 30 September 2021, 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.
7) RELATED PARTY TRANSACTIONS
The Group was charged $20,880 (2021: $19,850) in accounting fees by
Administration Outsourcing Co., Ltd, a company related by way of common
directorship, of which $5,644 (2021: $3,328) 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 $170,661 (2021: $151,711).
As at 31 August 2022, due from director amounted to $464,359 (2021: $507,605).
The amounts are unsecured, interest-free and repayable on demand.
8) 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.
2022 2021
Issued and fully paid
11,433,433 (2021: 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.
8) 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 (2021: $318,162).
9) 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 Nihon Wealth Management Company Limited are subject to
Thailand graduated statutory income tax at a rate of 0-15% (2021: 0-15%) on
profit before tax.
The current tax expense included in the consolidated statement of comprehensive
income was $nil (2021 : $nil).
The Group had no deferred tax assets or liabilities as at the reporting date.
10) 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-22 31-Aug-21
Earnings attributable to equity holders of the $(182,567) $123,067
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 $(0.01643) $0.01108
10) 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 2022 and 31 August 2021, 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-22 31-Aug-21
Earnings attributable to equity holders of the $(182,567) $123,067
Parent Company
Weighted average number of shares in issue and 11,111,433 11,111,433
for diluted earnings for share
Diluted earnings per share $(0.01643) $0.01108
11) 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 Nihon Wealth Management
Company Limited 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-22 31-Aug-21
Total Inter-segment Revenue from Total Inter-segment Revenue
segment revenue external segment revenue from
revenue customers revenue external
customers
BVI 842,203 - 842,203 936,688 - 936,688
Thailand 93,161 (91,501) 1,660 101,715 (98,290) 3,425
Total $935,364 $(91,501) $843,863 $1,038,403 $(98,290) $940,113
The revenue between segments is carried out at arm's length. Revenues from two
customers of the BVI segment represent approximately 66% (2021: 48%) of the
Group's total revenues.
11) SEGMENTAL INFORMATION (Cont'd)
Other profit and loss disclosures
31-Aug-22 31-Aug-21
Commission Depreciation Income tax Commission Depreciation Income tax
expense expense
BVI
436,696 680 - 416,702 771 -
Thailand
1,601 191 - 1,804 457 -
Total $ $ $ $ $ $
438,297 871 - 418,506 1,228 -
Assets
31-Aug-22 31-Aug-21
Total Assets Total Assets
BVI 2,161,804 2,268,275
Thailand 587,862 722,861
Total $ $
2,749,666 2,991,136
Intersegment assets amounting to $1,294,104 (2021: $1,071,593) were already
eliminated in the total assets per segment above.
Liabilities
31-Aug-22 31-Aug-21
Total Total
Liabilities Liabilities
BVI 1,367,196 1,269,618
Thailand 20,387 21,088
Total $ $
1,387,583 1,290,706
Intersegment liabilities amounting to $1,178,222 (2021: $948,568) were already
eliminated in the total liabilities per segment above.
12) 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 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.
12) 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 these
financial instruments, which earn interest at floating interest rates that are
reset as market rates change.
A sensitivity analysis was performed with respect to the interest-bearing
financial instruments and management noted that the anticipated interest rate
changes would have no material impact on the net assets of the Group.
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-22 31-Aug-21
Fair value % of net Fair value % of net
assets assets
Thailand Baht 1,079,276 79.24% 703,027 41.34%
Japanese Yen 774,466 56.86% 883,303 51.95%
Singaporean 237,425 17.43% 240,994 14.17%
Dollar
Euro 5,725 0.42% 26,058 1.53%
United Kingdom 151,590 11.13% 9,620 0.57%
Pound
$ 165.08% $ 109.56%
2,248,482 1,863,002
The amounts in the above table are based on the net carrying value of monetary
assets and liabilities.
The table below summarises the sensitivity of the net assets to changes in
foreign exchange movements at 31 August 2022 and 31 August 2021. 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.
12) FINANCIAL INSTRUMENTS AND ASSOCIATED RISKS (Cont'd)
a) Market risk (Cont'd)
Currency risk (Cont'd)
31-Aug-22 31-Aug-21
Possible Possible Possible Possible
shift in shift in shift in shift in
rate amount rate amount
Thailand Baht 4.40% 47,488 3.66% 25,731
Japanese Yen 3.15% 24,396 1.81% 15,988
Singaporean Dollar 4.49% 10,660 4.83% 11,640
Euro 1.91% 109 3.40% 886
United Kingdom 2.70% 4,093 5.14% 494
Pound
$ $
86,746 54,739
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 2022 and 31 August 2021, the Group's financial assets exposed
to credit risk amounted to the following:
31-Aug-22 31-Aug-21
Cash and cash equivalents 1,187,226 1,363,101
Trade receivables (net of allowance for 127,427 104,135
doubtful
accounts of $8,572 (2021: $8,572)
Financial assets at fair value through 283,324 240,994
profit or loss
Loans and other receivables 56,434 63,251
Due from director 464,359 507,605
$ $
2,118,770 2,279,086
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.
The Group invests available cash and cash equivalents with various banks. The
Group is exposed to credit-related losses in the event of non-performance by
such counterparties to financial instruments, but given their reasonable credit
ratings, management does not expect any such counterparty to fail to meet its
obligations.
12) FINANCIAL INSTRUMENTS AND ASSOCIATED RISKS (Cont'd)
b) Credit risk (Cont'd)
i) Risk management (Cont'd)
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
$39,187 (2021: $25,060) as at half year end, which represents 29% (2021: 22%)
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.
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.
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 2022 or 31 August 2021, 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.
12) FINANCIAL INSTRUMENTS AND ASSOCIATED RISKS (Cont'd)
b) Credit risk (Cont'd)
iii) Impairment of financial assets (Cont'd)
On that basis, the loss allowance as at 31 August 2022 and 31 August 2021 were
determined as follows:
Expected
Balance at Credit Loss Allowance
at
31-Aug-22 Loss Rate 31-Aug-22
Trade receivables $135,999 6.30% $8,572
Expected
Balance at Credit Loss Allowance
at
31-Aug-21 Loss Rate 31-Aug-21
Trade receivables $112,707 7.61% $8,572
The closing loss allowances for trade receivables as at 31 August 2022 and 31
August 2021 reconcile to the opening loss allowances as follows:
31-Aug-22 31-Aug-21
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.
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.
12) FINANCIAL INSTRUMENTS AND ASSOCIATED RISKS (Cont'd)
c) Liquidity risk (Cont'd)
All of the Group's financial liabilities are expected to be settled within a
year from the reporting date.
13) 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 and an investment in private equity.
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 amount due
from director approximates its fair value, since such amount is repayable on
demand.
Investments whose values are based on quoted market prices in active markets
are therefore classified within Level 1.
13) FAIR VALUE INFORMATION (Cont'd)
Financial assets and financial liabilities (Cont'd)
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. 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 and include investments in private equity. As
observable prices are not available for these securities, the Group uses
valuation techniques to derive the fair value.
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 2022 and 31 August 2021. 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.
31-Aug-22 31-Aug-21
Financial assets - Level 2
Philip Investment Fund 237,425 240,994
Financial assets - Level 3
Investment in private equity 45,899 -
Total financial assets at fair value $ $
through profit or loss 283,324 240,994
The table below provides a reconciliation of the movement in Level 3
investments:
The Level 3 investment is not priced in an open market and is valued using
valuation techniques and other information. Management believes that the
valuation technique used is most representative of fair value, and that no
alternative valuation was available.
31-Aug-22 31-Aug-21
Balance at 1 March 45,899 -
Purchase - -
Net unrealised loss - -
Balance at 31 August $ $
45,899 -
The Group did not hold any investments under the Level 1 hierarchies as at 31
August 2022 and 31 August 2021.
There were no significant investments transferred between Levels 1, 2 and 3.
13) FAIR VALUE INFORMATION (Cont'd)
Non-financial assets
As discussed in note 2(e), 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 valuation. 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. 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 estimate for investment property is included in Level 2 and has
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.
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 2022
and 31 August 2021:
31-Aug-22 31-Aug-21
Non-financial assets - Level 2
Investment property $ $
578,250 651,787
The Group did not hold any non-financial assets measured at fair value under
the Levels 1 and 3 hierarchies as at 31 August 2022 and 31 August 2021.
There were no significant investments transferred between Levels 1, 2 and 3.
14) 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.
END
(END) Dow Jones Newswires
December 01, 2022 05:16 ET (10:16 GMT)
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