Cfm-annual Report 2009.pdf

CONTENTS

2

Notice of Annual General Meeting

3

Corporate Information

4

Corporate Structure

5

Chairman’s Statement

6

Profile of Directors

8

Statement of Corporate Governance

13

Audit Committee Report

16

Statement of Internal Control

18

5 Years Group Financial Highlights

19

Financial Statements

65

Analysis of Shareholdings

67

List of Group’s Properties Proxy Form

Computer Forms (Malaysia) Berhad (4423-H)

Annual Report 2009

NOTICE OF

ANNUAL GENERAL MEETING

NOTICE IS HEREBY GIVEN THAT the Forty-Seventh Annual General Gen neral Meeting (“47th AGM”) of the shareholders sh hareholders of the Company will be held at Bukit Kiara Equestrian Equestrian and Country Resort, Dewan Berjaya, Jalan Bukit Kiara, Off Jalan Damansara, 60000 Kuala Lumpur, Malaysia on Tuesday, 29 September Septem mber 2009 2009 at at 11.00 11.00 a.m. a.m. for for the the purpose of conside ering and, if thought thought fit, passing the the following following resolutions: resoluti tio o n s: considering AGENDA Ordinary Business Bus usin nesss 1. To receivee and and nd adopt ado dopt pt the A udited Financial Financi ciall Statements cial ci Staattements e G the he Company Company for the hee Audited of thee Group and the financial year yeea ear ended een nded 31 3 March 2009 200 2 09 together t geth to theer w th ith th ith it he Re R ports of thee Directors Dir irec irec ecto to ors r and Auditors Auditorrs with the Reports thereon. Ordinary Ordi dina nary ryy Resolution 1 2. To approve the p ayme ay ment nt o off Directors’ Dire Di rect cttor ors’ s’’ fees f in respect res e pe p ct off thee financial finan fi ncial year yeaar ended en nde ded 31 31 March 2009. payment in

Ordinary Resolution 2

3. To re-elect Mrr O Ou u Wee Wee Su We SSun, n, a Dir n, D irrecto irec ecto ec or retir rretiring etirrin ingg in accordance accco orrda d nce with wit Articlee 8 83 3 of the Company’s Director Articless off A ssoc ss ocia oc ciaatio tion. n Association. Ordinary Ord Or dina di nary Resolution nary Ressolluti Res u on 3 4. To o rree-eelecct Dato eo' Ib Ibra raahi h m Ma Maha haalu ludi diin Bin d Bin Puteh, Puteeh, a Director Dirreccto or retiring reeti tirrin i g in n aaccordance cccor cco ordan nce with nc w th Article 90 of wi re-elect Dato' Ibrahim Mahaludin thee Co th Comp mpan mp any’ an y’ss Ar y’ Artic ticle tic lees of A Ass ssoc ss so occiaatio tion. n. n. Company’s Articles Association. Ordinary Or rdina dinaary Resolution Resol essoluti utio on 4 5. TTo 5. o rre-appoint e-ap eappo oin intt Me M ess sssrs r P au ul Ch Chua hu uaah & Co Co as as Auditors Audi Au diito t rss of of the th he Company Comp Co mpan mp an ny and and to authorise autho h rise s the se t Directors Messrs Paul Chuah Ordinary Ordi ina n ryy Resolution Resol o uti utio on 5 to o fix fix th ttheir eiir rem re emu muneeratio raatio tion. ti n. remuneration. 6. To ttransact 6. r ns ra nsac actt an ac ny ot o heer o or rd i n naa ry r y business bus b u in us n es esss off the t he h Company C om omp pa ny for which pa whii ch h due d ue notice n oti o cee has h a bee en any other ordinary been give gi ven. n.. given.

By Ord der o the he Bo Boar ad Order off th Board Loh Poh Wa W h Wah Secretary Kuala Lumpur 7 September 2009 20 009

Notes:

2

1.

appoint A member entitled to attend atte tteend n and vote at the meeting is entitled to appoin nt one on or more proxies (but not more than two) to attend and vote instead of him. A proxy may but need not be a member of the Company and the provisions of Section 149(1)(b) of the Act shall not apply to the Company. Where a member appoints two proxies to attend the same meeting, the member shall specify the proportion of his shareholding to be represented by each proxy, failing which the appointment(s) shall be invalid.

2.

The instrument appointing a proxy shall be in writing under the hand of the appointer or of his attorney duly authorised in writing or, if the appointor is a corporation, either under the corporation’s common seal or under the hand of an officer or attorney duly authorised. The instrument appointing a proxy shall be deemed to confer authority to demand or join in demanding a poll.

3.

The instrument appointing a proxy shall be deposited with the Share Registrar of the Company, Symphony Share Registrars Sdn Bhd at Level 26, Menara Multi Purpose, Capital Square, No. 8, Jalan Munshi Abdullah, 50100 Kuala Lumpur, Malaysia not less than 48 hours before the time appointed for holding the meeting or any adjournment thereof.

Annual Report 2009

Computer Forms (Malaysia) Berhad (4423-H)

CORPORATE

INFORMATION

BOARD OF DIRECTORS

REGISTERED OFFICE

Dato’ Ibrahim Mahaludin Bin Puteh

Lot 2, Jalan Usahawan 5 PKNS Setapak Industrial Area Off Jalan Genting Kelang 53300 Kuala Lumpur Tel: (603) 4023 3611 Fax: (603) 4021 3033

(Chairman, Independent Non-Executive Director)

En Muhayuddin Musa (Executive Director)

Mr Thor Poh Seng (Independent Non-Executive Director)

Mr Ou Wee Sun

PRINCIPAL BANKERS

(Independent Non-Executive Director)

CIMB Bank Berhad HSBC Bank Malaysia Berhad Malayan Banking Berhad

AUDIT COMMITTEE Dato' Ibrahim Mahaludin Bin Puteh (Chairman) Mr Thor Poh Seng Mr Ou Wee Sun

NOMINATION COMMITTEE Mr Thor Poh Seng (Chairman) Mr Ou Wee Sun

REMUNERATION COMMITTEE Mr Thor Poh Seng (Chairman) Mr Ou Wee Sun

SHARE REGISTRAR Symphony Share Registrars Sdn. Bhd. (Co. No. 378993-D) Level 26, Menara Multi Purpose Capital Square No. 8, Jalan Munshi Abdullah 50100 Kuala Lumpur Tel: (603) 2721 2222 Fax: (603) 2721 2530

AUDITORS

Mr Ou Wee Sun (Chairman) Mr Thor Poh Seng En Muhayuddin Musa

Messrs Paul Chuah & Co. (Chartered Accountants) 17, Jalan Ipoh Kecil 50350 Kuala Lumpur

SENIOR INDEPENDENT NON-EXECUTIVE DIRECTOR

STOCK EXCHANGE LISTING

Mr Thor Poh Seng Fax : (603) 4022 1571

Bursa Malaysia Securities Berhad Main Market

COMPANY SECRETARY

www.cfm.com.my

EMPLOYEES’ SHARE OPTION SCHEME COMMITTEE

WEBSITE

Ms Loh Poh Wah

Computer Forms (Malaysia) Berhad (4423-H)

Annual Report 2009

3

CORPORATE

STRUCTURE

100%

Chip Seng Trading (Holdings) Sdn Bhd

100%

Contipak Noron Sdn Bhd

100%

CFM Printing & Stationery Sdn Bhd

56%

CFM Toppan Forms (M) Sdn Bhd*

* Not Audited by Meassrs Paul Chuah & Co. Note : Dormant companies are excluded.

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Annual Report 2009

Computer Forms (Malaysia) Berhad (4423-H)

CHAIRMAN’S

STATEMENT

On behalf of the Board of Directors, I am pleased to present the Annual Report and Audited Accounts of the Company and its subsidiaries (“the Group”) for the financial year ended 31 March 2009. GENERAL OVERVIEW The Malaysian economy reported a growth in Gross Domestic Product (GDP) of 4.6% in year 2008 against a growth of 6.3% in year 2007. 2008 was a challenging year with the start of a global recession. Crude oil prices reached record highs in July 2008 leading to increased costs for all significant raw materials utilised by the Group such as paper, ink, plastics and aluminum. During the last calendar quarter of 2008, business confidence in the country fell resulting in slower sales orders for the Group as customers reduced inventory levels. Printing has always been highly competitive and in the past one year the Group has continued to reduce costs and increase efficiency. The Group has concentrated on growing the print packaging and data print businesses in order to earn better margins.

FINANCIAL PERFORMANCE During the financial year under review, the Group registered a profit before tax of RM1.33 million on a revenue RM48.1 million as compared to a profit before tax of RM1.28 million on revenue of RM45.8 million the previous financial year. Group revenue increased 5.2% from the growth of our print packaging and data print businesses. The slight increase in profit before tax was primarily due to the strong performances of our general printing and data print businesses. Gross profit margins were slightly lower at 18.0% as compared to 18.4% the previous year. Reduced gross profit margins were due to higher prices of raw materials. However net profit attributable to shareholders of the Company fell 83% to RM0.2 million as compared to the previous financial year. This decrease was primarily due to higher taxation charge of RM0.8 million as compared to RM0.03 million the previous financial year.

FUTURE PROSPECTS The future prospects for the Group will be dependent on the recovery of the global economy in general and particularly, the Malaysian economy. A stronger Malaysian economy will result in revenue growth for the Group as our customers expand their business volume. However our profitability is very dependent on the price of crude oil which affects the price of all printing raw materials. The Board is hopeful that Group revenue will continue to grow in the next financial year and profit margins can be maintained.

BOARD CHANGES I am pleased to have been appointed a Director and Chairman of the Company during the financial year.

ACKNOWLEDGEMENTS I wish to express my sincere appreciation to my fellow Board members, the management and staff of the Group for their hard work and dedication which has contributed positively to our performance in the financial year. On behalf of the Board, I extend our gratitude to our shareholders, valued customers, suppliers, bankers and business associates for their continued support and confidence.

DATO’ IBRAHIM MAHALUDIN BIN PUTEH Chairman Computer Forms (Malaysia) Berhad (4423-H)

Annual Report 2009

5

PROFILE OF

DIRECTOR DATO' IBRAHIM MAHALUDIN BIN PUTEH Chairman, Independent Non-Executive Director

Dato' Ibrahim Mahaludin Bin Puteh, aged 58, Malaysian, was appointed to the Board of Computer Forms (Malaysia) Berhad on 1 December 2008 as Chairman of the Board and Chairman of the Audit Committee. He holds a BA (Hons) degree from the University of Malaya and a Masters in Business Administration degree from the Manchester Business School, University of Manchester, United Kingdom. Dato' Ibrahim was the Deputy Secretary General of the Treasury (Policy) of the Ministry of Finance from April 2007 to October 2008. Prior to that, he had served in various divisions at the Ministry of Finance since 1974. He has also served as the Senior Adviser to the Executive Director for South East Asia at the World Bank Group in Washington DC, USA from 2003 to 2004. He is also the Group Chairman of Syarikat Prasarana Negara Berhad and a Director of Pos Malaysia Berhad.

MUHAYUDDIN MUSA Chief Executive Officer (Executive Director) Muhayuddin Musa, aged 47, Malaysian, was appointed to the Board of Computer Forms (Malaysia) Berhad on 26 June 1998. He is also a member of the ESOS Committee. He holds a Bachelor of Commerce (Honours) degree from Carleton University, Ottawa, Canada. He began his career as a Financial Officer at Lembaga Letrik Negara (LLN). Thereafter he joined the banking industry marking his tenure into the private sector. He has held various positions in both local and foreign banks. Subsequently he joined Federal Furniture Holdings (M) Bhd as Corporate Affairs Manager and also as Managing Director of one of the Group’s subsidiaries. Currently, he also sits on the Board of APB Resources Berhad, Malpac Holdings Berhad and the subsidiary companies of CFM.

THOR POH SENG Independent Non-Executive Director Thor Poh Seng, aged 49, Malaysian, was appointed to the Board of Computer Forms (Malaysia) Berhad on 14 March 2006 and was also appointed the Chairman of the Audit Committee, member of the Nomination Committee and ESOS Committee on the same date. On 11 December 2006, he was appointed the Chairman of the Remuneration Committee. On 1 December 2008, he resigned as the Chairman of the Audit Committee but remained as a member of the Audit Committee. He holds a Bachelor of Engineering degree from Universiti Pertanian Malaysia (now known as Universiti Putra Malaysia) and a Master’s degree in Business Management from the Asian Institute of Management, Philippines. Mr Thor was an ex-merchant banker from Commerce International Merchant Banker Berhad (“CIMB”) with extensive experience in corporate finance and corporate planning. Prior to joining CIMB, he has held senior positions in operations and in finance in Dunlop Estates Berhad and Sitt Tatt Berhad respectively. He is also a Director of Marco Holdings Berhad, PDZ Holdings Bhd, Keladi Maju Berhad, Malaysia Aica Berhad, FCW Holdings Berhad, Jasa Kita Berhad, GPA Holdings Berhad and Goh Ban Huat Berhad.

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Annual Report 2009

Computer Forms (Malaysia) Berhad (4423-H)

PROFILE OF

DIRECTOR OU WEE SUN Independent Non-Executive Director

Ou Wee Sun, aged 39, Malaysian, was appointed to the Board of Computer Forms (Malaysia) Berhad on 14 March 2006 and was also appointed as member of the Audit Committee and Nomination Committee on the same date. On 11 December 2006, he was appointed as the Chairman of ESOS Committee and member of the Remuneration Committee. Mr. Ou holds a Bachelor of Business degree from the Edith Cowan University, Australia and is a member of CPA Australia. He is also a member of the Malaysian Institute of Accountants and a chartered member of the Institute of Internal Auditors, Malaysia. He started off his career in financial auditing with Coopers & Lybrand. He later moved to Deloitte KassimChan before joining a large diversified public listed company in 1994. He joined Moores Rowland Risk Management Sdn Bhd in 2001 to spearhead the company’s internal audit and risk management services. Currently, he is a General Manager of a consultancy company specializing in internal audit and risk management.

ADDITIONAL INFORMATION ON THE DIRECTORS: Family Relationship There is no other family relationship among the Board members and/or the major shareholders of the Company. Conflict of Interest To date, there has not been any occurrence of conflict of interest between any Board Member and the Company. Conviction of Offences None of the Directors have been convicted of any offence within the past 10 years, other than traffic offences, if any.

Computer Forms (Malaysia) Berhad (4423-H)

Annual Report 2009

7

STATEMENT OF

CORPORATE GOVERNANCE

The Board of Directors of Computer Forms (Malaysia) Berhad (“CFM” or “the Company”) is pleased to report on how the Company had applied the principles contained in the Malaysian Code on Corporate Governance (“the Code”) and the extent of compliance with the Best Practices of the Code as required under the Listing Requirements of Bursa Malaysia Securities Berhad (“BMSB”). The Board of Directors (“the Board”) is committed to ensuring that the appropriate standards of corporate governance are practiced throughout the CFM Group as a fundamental part of discharging its responsibilities with the ultimate aim of protecting and enhancing shareholders’ value and the financial performance of the CFM Group. A. BOARD OF DIRECTORS The Board The Board has overall responsibility in charting the strategic direction of the Group, overseeing the entire Group’s businesses to ensure that they are properly managed and carried out, and ultimately the enhancement of long-term shareholders’ value. Board Balance The Board currently comprises four members with an Independent Non-Executive Chairman, an Executive Director and two Independent Non-Executive Directors. To ensure a balance of power and authority, there is a clear division of responsibility between the roles of the Chairman and the Executive Director. The Chairman guides and ensures the effectiveness of the Board policies, while the Executive Director is tasked to run the day to day management of the business as well as the implementation of the Board’s policies and decisions. The Board considers its current composition with the mix of skills and expertise is sufficient and optimum for the discharge of its duties and responsibilities effectively. A brief profile of each Director is presented from pages 6 to 7 of this Annual Report. The Board acknowledges that the role of independent non-executive directors are particularly important as they contribute independent judgment towards the Group’s business activities and strategies. In this respect, the three independent non-executive directors sitting on the Board which constituted more than one-third of the Board composition, are capable of ensuring a balanced and independent judgment on issues requiring the Board’s deliberation and decision. Board of Directors’ Meeting The Board meets to review and discuss matters specifically reserved to itself for decision to ensure that the direction and control of the Group is firmly in its hands. Key matters tabled at Board meetings include review and adoption of the Group’s quarterly and year end financial results, business plan, annual budget, assets acquisition, approval on major capital expenditure projects and consideration of significant financial matters, Group policies and delegated authority limits. Two official board meetings were held during the reporting financial year with full attendance of all Directors, and all deliberation and conclusions thereon were properly recorded by the Company Secretary present at the meetings. Board Committees The following Board Committees have been established to assist the Board in discharging its responsibilities. These committees are delegated with specific responsibility as defined in their respective terms of reference, each committee will deliberate and examine issues within its terms of reference and report to the Board with recommendation(s). (i)

Audit Committee Details of the Audit Committee Report are set out on pages 13 to 15 of this Annual Report.

(ii)

Nomination Committee The Nomination Committee, which was established on 30 July 2002, comprises two members, both of whom are Independent Non-Executive Directors.

8

Annual Report 2009

Computer Forms (Malaysia) Berhad (4423-H)

STATEMENT OF

CORPORATE GOVERNANCE

(ii)

Nomination Committee (continued) The members of the Nomination Committee are:(1) (2)

Mr Thor Poh Seng Mr Ou Wee Sun

The Nomination Committee is tasked with the responsibility of recommending to the Board, suitable candidates for appointment as Directors and to fill the seats on Board Committees whenever necessary. It will also carry out the process of assessing the effectiveness of the Board as a whole, the Board Committees and the performance and contribution of each individual Director towards the Group, including the independent non-executive directors as well as the chief executive officer. All assessments and evaluations carried out were properly documented. Decision on appointments of new Directors is made by the full Board on a collective basis after considering recommendations of the Nomination Committee. Generally, the Nomination Committee will assist the Board to review annually its required mix of skills, experience and other qualities, including core competencies which the Non-Executive Directors should bring to the Board. The Nomination Committee met once during the financial year with full attendance of the Committee members. (iii)

Remuneration Committee The Remuneration Committee was established on 30 July 2002. It comprises wholly of Non-Executive Directors and the members of the Remuneration Committee are :(1) (2)

Mr Thor Poh Seng Mr Ou Wee Sun

The Remuneration Committee’s primary responsibility is to recommend to the Board the remuneration of the Executive Directors in all its forms, drawing from outside resources where necessary. The Remuneration Committee also reviews the remuneration packages and benefits accorded to the Executive Directors as well as the Non-Executive Directors’ remunerations on an annual basis. In the case of Executive Director, the component parts of remuneration are structured to link rewards to corporate and individual performance. In the case of Non-Executive Directors, the level of remuneration reflects the level of participation and responsibilities undertaken by them. The Board as a whole determines the remuneration package of Non-Executive directors including the Non-Executive Chairman. The individuals concerned will abstain from discussing their own remuneration. The Remuneration Committee met once during the financial year with full attendance of the Committee members. The details of the Directors’ remunerations for the financial year ended 31 March 2009 are as follows :

Category of Remuneration (a)

Fees

(b) Salaries (c)

Bonuses

(d) Estimated value of benefits-in-kind Total

Computer Forms (Malaysia) Berhad (4423-H)

Executive Director (RM)

Non-Executive Directors (RM)

Total (RM)

-

52,000.00

52,000.00

294,000.00

-

294,000.00

47,040.00

-

47,040.00

73,247.00

-

73,247.00

414,287.00

52,000.00

466,287.00

Annual Report 2009

9

STATEMENT OF

CORPORATE GOVERNANCE (continued)

The analysis of Directors’ remunerations is as follows: Band (RM)

(iv)

No. of Executive Director

No. of Non-Executive Directors

Total

1

–

50,000

-

3

3

400,001

–

450,000

1

-

1

Total

1

3

4

Employees’ Share Option Scheme Committee (“ESOS Committee”) The ESOS Committee was established on 26 May 2004 to administer the CFM Employees’ Share Option Scheme which was approved by the shareholders on 30 September 2004. The main responsibility of the ESOS Committee is to regulate and approve the securities transactions and registrations of the ESOS. The members of the ESOS Committee are :(1) Mr Ou Wee Sun (2) Mr Thor Poh Seng (3) En Muhayuddin Musa

Re-election of Directors In accordance with the Company’s Articles of Association, Directors shall retire from office at least once every three (3) years, and shall be eligible for re-election at each Annual General Meeting. All newly appointed Directors shall hold office until the conclusion of the next Annual General Meeting and shall be eligible for re-election. Directors who are above the age of seventy (70) are required to submit themselves for re-appointment by shareholders annually in accordance with Section 129(6) of the Companies Act, 1965. Directors' Training The Board of Directors acknowledges the importance of continuous education for keeping abreast with regulatory updates and developments in the business environment. Newly appointed directors will be provided with a brief induction of the Group’s business operations, past performances and corporate exercise undertaken. Apart from the Mandatory Accreditation Programme (“MAP”) accredited by BMSB, the Directors are also encouraged to attend various seminars and training programmes to constantly stay updated with changes and development in various aspects of the business environment. Conferences, seminars and training programmes attended by the Directors during the financial year are as follows :Title

Area of Focus

•

Effective Chairmanship

Corporate Governance

•

Financial Reporting During Financial Turbulence

Accounting & Economics

•

Functions & Powers of the Board of Directors

Legislation (Amendment to the Companies Act, 1965)

•

Substantial Property Transaction by Director or

Legislation (Amendment to the Companies Act, 1965)

Substantial Shareholders The Board will continue to evaluate and determine the training needs of the Directors from time to time to enhance their skills and knowledge in order to discharge their duties effectively.

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Annual Report 2009

Computer Forms (Malaysia) Berhad (4423-H)

STATEMENT OF

CORPORATE GOVERNANCE (continued)

Supply of Information All the Directors are provided with a set of board papers before board meetings consisting of the agenda and all other relevant materials. This procedure enables the Directors to have sufficient time to peruse the papers and if necessary, to obtain further information or clarification from the Management. In addition to the board papers, the Board would also be provided with texts of any major corporate announcements to be released to BMSB and kept informed of any new legislation, rules and regulations issued by the various regulatory authorities, where relevant. In furtherance of their duties, the Directors as a full Board or in their individual capacity have access to all information relating to Group as well as unrestricted access to the advice and services of the senior management and the Company Secretary. The Directors may also engage independent professional services, where necessary. B. SHAREHOLDERS Dialogue between Companies and Investors The Board of Directors acknowledges the need for shareholders to be informed of all material business matters affecting the Group and as such, maintains a constructive communication policy, which enables the Board and the Management to communicate effectively with the shareholders and the investing public generally. In this respect, the Board observes timely release of quarterly financial results and corporate proposal announcements via the Bursa Link and the press (where appropriate), annual reports and circulars to shareholders to ensure that the shareholders and investing public are kept informed of the Group’s performance and prospect. In addition, the Company has a website, www.cfm.com.my which provides an avenue for the Company’s information inclusive all announcements to the public at large. The public may also forward their queries and concerns regarding the Company to the designated person(s) whose contact details are included in the Company’s website. General Meeting of Shareholders The Annual General Meeting (“AGM”) of the shareholders of the Company represents the principal forum for dialogue and interaction between the Board and the shareholders, during which the shareholders are given the opportunity to raise questions pertaining to the resolutions tabled thereat or business activities of the Group. Extraordinary General Meeting (“EGM”) is held as and when shareholders’ approvals are required on specific matters. Notices of AGM and EGM are sent out to the shareholders within a reasonable and sufficient time frame and are published in a nationally circulated newspaper. A press conference may be held after each AGM or EGM of the Company, if necessary. C. ACCOUNTABILITY AND AUDIT Financial Reporting The CFM Group aims to provide and present a clear, balanced and comprehensive assessment of its financial performance and prospect through the annual financial statements and quarterly results to the shareholders and investing public. In this respect, the Board is assisted by the Audit Committee in reviewing and overseeing the Group’s financial reporting process to ensure correctness and adequacy before tabling the financial statements and quarterly results to the Board for further review prior to announcement or presentation to the shareholders at AGM. The statement by Directors pursuant to Section 169 (15) of the Companies Act, 1965 is set out on page 23 of this Annual Report. Internal Control The CFM Group’s Statement of Internal Control is set out on pages 16 to 17 of this Annual Report. Relationship with Auditors The Board, the Audit Committee and the Management maintain a formal and transparent relationship with the Group’s Auditors in seeking their professional advice and opinion on accounting matters to ensure compliance with the relevant financial reporting standards. The relationship between the Audit Committee and the Auditors is set out on page 13 to 14 of this Annual Report.

Computer Forms (Malaysia) Berhad (4423-H)

Annual Report 2009

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STATEMENT OF

CORPORATE GOVERNANCE (continued)

D. OTHER INFORMATION a)

Options, Warrants or Convertible Securities Details of the ESOS are disclosed in Note 27 on page 61 of this Annual Report. The Company did not issue warrants or convertible securities during the financial year.

b)

Non-Audit fees Non-audit fees amounting to RM2,500.00 was paid to the external auditors during the financial year ended 31 March 2009.

c)

Revaluation Policy The CFM Group has a policy of revaluing its land and building once in every five (5) years. The last revaluation was undertaken in 2008.

d)

Material contracts There were no material contracts entered into by the Company and the Group which involved Directors’ and major shareholders’ interest during the financial year.

e)

Corporate Social Responsibility (CSR) The Group takes into account the significance of environment, social obligations and corporate governance matters in pursuing its business objectives. Throughout the year, the Group carries out its CSR activities focusing on the following areas: i)

Occupational Safety & Health Commitment The Group is committed to ensuring minimal impact on the environment as well as to protecting the safety and health of our employees, customers and neighbours. Over the years, the Group has developed and formulated occupational safety and health policies to ensure a safe work place environment for our employees, customers and neighbours. The Group is also committed to implementing policies and procedures including work instructions that assist in ensuring our operations are conducted and performed in accordance and in compliance with existing laws, regulations and standard.

ii)

Environmental Practice Paper is our main raw material and wherever possible we try to source from reputable paper mills that practice sustainable forest management. Apart from selecting environmentally responsible vendors, efforts are being made to educate some of our customers to utilise recycled paper. The Group is committed to ensuring that all our waste materials are disposed in an environmentally friendly way. Our waste papers are discarded through a paper recycling plant. Ink and chemical waste are collected and disposed by Quality Alam, the approved government agency responsible for toxic waste disposal.

E. DIRECTORS' RESPONSIBILITY STATEMENT The Directors are required by the Companies Act, 1965 (the “Act”), to ensure that financial statements of the Company and the Group for each financial year are drawn up in accordance with the applicable approved accounting standards of Malaysia and the provision of the Act so as to give a true and fair view of the Company and the Group’s affairs, results and cashflow position for the financial year. The Directors consider that in preparing the financial statements for the year ended 31 March 2009, the CFM Group had used appropriate accounting policies, consistently applied and supported by reasonable and prudent judgments and estimates, and that all applicable accounting standards have been followed. The Directors are also responsible for ensuring that the CFM Group keeps adequate accounting records, which disclose with reasonable accuracy the financial position of the CFM Group at any point of time. In addition, the Directors have taken steps to safeguard the assets of the CFM Group to prevent and detect fraud and other irregularities.

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Annual Report 2009

Computer Forms (Malaysia) Berhad (4423-H)

AUDIT COMMITTEE

REPORT

The Board of Computer Forms (Malaysia) Berhad (“CFM” or “the Company”) is pleased to present the Audit Committee Report for the financial year ended 31 March 2009 as follows:

COMPOSITION OF THE AUDIT COMMITTEE Name

Directorship

Membership

Dato' Ibrahim Mahaludin Bin Puteh

Independent & Non-Executive

Chairman

Thor Poh Seng

Independent & Non-Executive

Member

Ou Wee Sun (MIA member)

Independent & Non-Executive

Member

TERMS OF REFERENCE 1.

2.

Membership a)

The CFM Audit Committee shall be appointed by the Board from amongst their number and shall consist of not less than three (3) members, a majority of whom shall be independent non-executive directors.

b)

At least one member of the Committee must be qualified under paragraph 15.10(1)(c) of the Listing Requirements of BMSB.

c)

Executive Director(s) and alternate director(s) cannot be appointed as member(s) of the Committee.

d)

The Chairman of the Committee shall be an independent non-executive director appointed by the Board.

e)

In the event of any vacancy in the Committee that results in non-compliance of paragraph 15.10(1) of the Listing Requirements of BMSB, the vacancy shall be filled within three (3) months.

Authority The Audit Committee shall, at the Company’s expense, have the following authority and rights:a)

to investigate any activity within its terms of reference. It is authorised to seek any information it requires from any employee and all employees are directed to co-operate with any request made by the Committee;

b)

to obtain independent professional advice and to secure the attendance of outsiders with relevant experience and expertise at its meetings if it considers this necessary;

c)

full and unrestricted access to any information and documents from the external auditors and senior management of the Company and the Group which are relevant to the activities of the Company;

d)

be provided with the necessary resources which are required to perform its duties;

e)

have direct communication channel with the external auditors and persons carrying out the internal audit function of the Company;

f)

be able to convene meetings with the external auditors, the internal audit consultants or both, excluding the attendance of other directors and employees of the Group, whenever deemed necessary; and

g)

may extend invitation to other non-member directors and officers of the Company to attend a specific meeting, whenever deemed necessary.

Computer Forms (Malaysia) Berhad (4423-H)

Annual Report 2009

13

AUDIT COMMITTEE

REPORT (continued)

3.

Duties The duties of the Committee shall be:(a)

to review :(i)

with the external auditors, the audit plan;

(ii)

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

(iii) with the external auditors, their audit report; (iv) the assistance given by the Company’s officers to the external auditors and to meet with the external auditors without executive board members present at least twice a year; (v)

the balance sheet and profit and loss account of the Company and, if it is a holding company, the consolidated balance sheet and profit and loss account, submitted to it by the Company, and thereafter to submit them to the directors of the Company;

(vi) any related party transactions that may arise within the Company or group; (vii) the adequacy of the scope, functions, competency and resources of the internal audit consultants and to ensure that it has the necessary authority to carry out its work; (viii) to take cognizance of resignations of internal audit staff members and provide the resigning staff member an opportunity to submit his/her reasons for resigning, if the staff member concerned so desires; and (ix)

4.

any internal audit programme, processes, the results of the internal audit programme, processes or investigations undertaken and whether or not appropriate action is taken on the recommendations of the internal audit consultants;

(b)

To consider the nomination of external auditors and recommend to the Board of Directors for their appointment and the level of their fees;

(c)

To consider any resignation or removal of the external auditors, and to furnish such written explanation or representation from the external auditors to Bursa Malaysia Securities Berhad;

(d)

The Chairman of the AC should engage on a continuous basis with senior management, the head of internal audit and the external auditors in order to be kept informed of matters affecting the company; and

(e)

To undertake such other functions as may be agreed by the Audit Committee and the Board of Directors.

Meetings of the Audit Committee Meeting shall be held not less than four times a year. In addition, the Chairman of the Committee may call a meeting of the Committee upon the request of the external auditors, to consider any matter the external auditors believe should be brought to the attention of the Board and shareholders. Other Board members shall also have the right of attendance. At least twice a year the Committee shall meet with the external auditors without executive Board members and other employees’ present. Majority members present in person who are independent non-executive directors shall be a quorum. The Company Secretary shall be the Secretary of the Committee. During the financial year ended 31 March 2009, there were four meetings held with full attendance of the Committee members.

14

Annual Report 2009

Computer Forms (Malaysia) Berhad (4423-H)

AUDIT COMMITTEE

REPORT (continued)

5.

Performance Review The term of office and performance of the CFM Audit Committee and each of its members shall be reviewed by the Board of Directors of the Company at least once every three years to determine whether the Committee and its members have carried out their duties in accordance with these Terms of Reference.

SUMMARY OF ACTIVITIES DURING THE FINANCIAL YEAR i)

Reviewed the Group’s quarterly financial results and made suitable recommendations thereon to the Board for adoption prior to their release to BMSB for the financial quarters ended 31 March 2008, 30 June 2008, 30 September 2008 and 31 December 2008.

ii)

Reviewed the audited financial statements of the Company and the Group for the financial year ended 31 March 2008, and made suitable recommendations thereon to the Board for adoption prior to its release to BMSB and presentation to the Shareholders at the Company’s 46th Annual General Meeting.

iii)

Reviewed the Group Budget for the financial year ended 31 March 2009.

iv)

Reviewed and discussed the audit findings presented by the External Auditors in respect of the audit for the financial year ended 31 March 2008.

v)

Reviewed the Audit Plan for the financial year ended 31 March 2009 presented by the External Auditors.

vi)

Reviewed the resignation and appointment of internal audit consultants during the financial year.

vii) Reviewed the Risk Assessment Report prepared by the Group’s internal audit consultants. viii) Reviewed and discussed with management, the audit findings and recommendations proposed by the internal audit consultants for the enhancement of the system of internal controls.

INTERNAL AUDIT FUNCTION The Board recognizes that effective internal control is essential to ensure that every aspect of the Group’s operations and management are conducted with clear lines of control and accountability with the ultimate objective to safeguard the Shareholders’ investment and the Group’s assets. It had in March 2002 outsourced its internal audit function to an independent firm of consultants. The total cost incurred for the Group’s internal audit function in respect of the financial year ended 31 March 2009 was RM30,000. The activity of the internal audit function is detailed in the Statement of Internal Control on pages 16 to 17 of this Annual Report.

Computer Forms (Malaysia) Berhad (4423-H)

Annual Report 2009

15

STATEMENT OF

INTERNAL CONTROL

Introduction The Board of Directors of Computer Forms (Malaysia) Berhad (“CFM” or “the Company”) is committed to maintaining a sound internal controls system in the CFM Group and is pleased to provide the following Statement of Internal Control which outlines the nature and scope of internal control of the CFM Group during the year pursuant to Paragraph 15.27(b) of the Listing Requirements of Bursa Malaysia Securities Berhad (“BMSB”). To this end, the Board of Directors (“the Board”) also ensures that the external auditors review the Statement of Internal Control and report the results thereto to the Board annually. Responsibility The Directors acknowledge their responsibility for the CFM Group’s system of internal controls. The Board is equally aware that due to the limitations that are inherent in any system of internal controls, the system of internal controls is designed to manage rather than eliminate the risk of failure to achieve business objectives. This system, by its nature, can only provide reasonable but not absolute assurance against material loss or against the CFM Group failing to achieve its objectives. The key elements of the CFM Group's internal control system are described below:

16

•

Clearly defined delegation of responsibilities to committees of the Board and to operating units, including authorisation levels for all aspects of the business.

•

The CFM Group's management operates a risk management process that identifies the key risks by line of business and key functional activities.

•

Regular internal audit visits which monitor compliance with procedures and assess the integrity and reliability of financial information.

•

Regular receipt and review of reports from the management of various lines of business, on the key operating statistics/indicators, legal, environmental and regulatory matters.

•

Detailed budgeting process where operating units prepare budgets for the coming year which are approved both at operating unit level and by the Board and a monthly monitoring of results against budget with major variances being followed up and management action taken, where necessary.

•

Regular visits to operating units by members of the Board and senior management whenever appropriate.

•

The CFM Group's internal audit function reporting to the Audit Committee performs regular reviews of business processes to assess the effectiveness of internal controls and highlight significant risks impacting the CFM Group.

•

The Audit Committee reviews and holds discussions on the action taken on internal control issues identified in reports prepared by the internal audit function.

Annual Report 2009

Computer Forms (M) Berhad (4423-H)

STATEMENT OF

INTERNAL CONTROL

(continued)

Risk Management Following the issuance of "Statement on Internal Control: Guidance for Directors of Public Listed Companies' by BMSB, the CFM Group has implemented a formal approach towards identifying, evaluating, monitoring and managing the significant risks affecting the achievement of its business objectives. This is an ongoing process which has been regularly reviewed by the Board of the CFM Group. In line with this, a Risk Assessment Framework had been formalised in April 2002. Following the formalisation of the Risk Assessment Framework, the internal audit function had carried out three risk assessment exercises on the CFM Group and the respective risk assessment reports were tabled to the Audit Commitee in May 2002, November 2004 and February 2009. Internal Audit Function The internal audit function of CFM Group has been outsourced to independent firms of consultants since March 2002. The internal audit function, in which a head of internal audit has been identified, reports directly to the Audit Committee, and is responsible for carrying out regular and systematic reviews on the system of internal controls, risk management and governance processes so as to provide reasonable assurance that such system and processes operate effectively within the CFM Group. The internal audit function adopts a risk-based approach and prepares its audit strategy and plan based on the risk profiles of the key business units of the CFM Group. The activity carried out by the internal audit function during the financial year ended 31 March 2009 was the third risk assessment exercise for the CFM Group which was performed as part of the continual process of identifying, re-assessing and managing risks associated with the Group’s key business processes where a risk assessment report together with the updated risk register and internal audit plan for the next three (3) years were tabled to the Audit Committee. The CFM Group has in place an organisational structure with defined lines of responsibility, delegation of authority and a process of hierarchical reporting. The Executive Director reports to the Board on significant changes in the business and external environment, which affect the CFM Group. The Board is provided with financial information on a quarterly basis, which includes key performance indicators and amongst others, the monitoring of results against budget.

Computer Forms (Malaysia) Berhad (4423-H)

Annual Report 2009

17

5 YEARS GROUP FINANCIAL

HIGHLIGHTS

Group

2009 RM’000

2008 RM’000

2007 RM’000

2006 RM’000

2005 RM’000

Revenue

48,155

45,776

40,415

38,444

39,648

1,329

1,277

2,023

(414)

1,060

190

1,116

2,108

(380)

704

42,471

42,280

41,095

38,825

39,648

0.46

2.72

5.14

(0.93)

1.72

Profit/(Loss) Before Tax Profit/(Loss) Attributable to Equity Holders of the Company

Earnings/(Loss) per share (sen)

SHAREHOLDERS’ FUNDS (RM’000)

39,648

2,000

20

20

1,000

10

10

0 2009

0

0 2009

18

2008

2007

Annual Report 2009

2006

2005

2008

2007

704

30

190

30

(380)

38,825

3,000

41,095

42,280

39,648

38,444

40

40,415

45,776

48,155 40

4,000

42,471

50

50

2,108

REVENUE (RM’000)

PROFIT / (LOSS) ATTRIBUTABLE TO EQUITY HOLDERS OF THE COMPANY (RM’000)

1,116

Shareholders’ Funds

2006

2005

-1,000 2009

2008

2007

2006

2005

Computer Forms (Malaysia) Berhad (4423-H)

FINANCIAL STATEMENTS

20

Directors’ Report

23

Statement by Directors

23

Statutory Declaration

24

Auditors’ Report

26

Consolidated Income Statement

27

Consolidated Balance Sheet

28

Consolidated Statement of Changes in Equity

29

Consolidated Cash Flow Statement

31

Notes to the Consolidated Cash Flow Statement

32

Income Statement

33

Balance Sheet

34

Statement of Changes in Equity

35

Cash Flow Statement

37

Notes to the Financial Statements

Computer Forms (Malaysia) Berhad (4423-H)

Annual Report 2009

DIRECTORS’ REPORT

for the financial year ended 31 March 2009

The directors have pleasure in submitting their report together with the audited financial statements of the Group and of the Company for the financial year ended 31 March 2009.

PRINCIPAL ACTIVITIES The principal activities of the Company are that of printing and distributing of computer forms, stock forms and specialised forms. The principal activities of the subsidiary companies are set out in Note 11 to the financial statements. There have been no significant changes in the nature of these activities during the financial year.

RESULTS

The Group RM

The Company RM

510,668

537,610

Profit for the year

DIVIDEND No dividend has been declared or proposed by the Company since the end of the previous financial year.

SHARE CAPITAL The Company did not issue any shares or debentures during the financial year.

RESERVES AND PROVISIONS There were no material transfers to or from reserves or provisions during the financial year except as disclosed in the financial statements.

EMPLOYEES’ SHARE OPTION SCHEME (“ESOS”) The details of the ESOS are set out in Note 27 to the financial statements.

DIRECTORS The directors in office since the date of the last report are: Dato’ Ibrahim Mahaludin Bin Puteh Muhayuddin Bin Musa Thor Poh Seng Ou Wee Sun

(appointed on 1/12/2008)

In accordance with the Company’s articles of association, Ou Wee Sun and Dato’ Ibrahim Mahaludin Bin Puteh retire at the forthcoming annual general meeting and being eligible, offer themselves for re-election.

20

Annual Report 2009

Computer Forms (Malaysia) Berhad (4423-H)

DIRECTORS’ REPORT

for the financial year ended 31 March 2009 (Continued)

DIRECTORS’ INTERESTS None of the directors in office at the end of the financial year had any interest in shares in the Company and its related corporations during the financial year The options granted to directors are as follows: Options to subscribe for ordinary shares of RM1 each As at As at Granted Exercised 1/4/2008 31/3/2009 Muhayuddin Bin Musa

800,000

-

-

800,000

DIRECTORS’ BENEFITS Since the end of the previous financial year, no director has received or become entitled to receive a benefit (other than benefits disclosed as directors’ remuneration in the financial statements) by reason of a contract made by the Company or a related corporation with the director or with a firm of which he is a member, or with a company in which he has a substantial financial interest. Neither at the end of the financial year, nor at anytime during the financial year, did there subsist any arrangements to which the Company is a party, being arrangements with the object or objects of enabling directors to acquire benefits by means of the acquisition of shares in the Company or shares in, or debentures of any other body corporate except for their entitlement to subscribe for new ordinary shares of the Company under the Employees’ Share Option Scheme (“ESOS”).

STATUTORY INFORMATION ON THE FINANCIAL STATEMENTS (a) Before the financial statements of the Group and of the Company were made out, the directors took reasonable steps to: (i)

ascertain that proper action had been taken in relation to the writing off of bad debts and the making of allowance for doubtful debts, and satisfied themselves that all known bad debts had been written off and that adequate allowance had been made for doubtful debts; and

(ii) ensure that any current assets, other than debts, which were unlikely to realise in the ordinary course of business their values as shown in the accounting records of the Group and of the Company have been written down to amounts which they might be expected so to realise. (b) At the date of this report, the directors are not aware of any circumstances: (i)

which would render the amount written off for bad debts or the amount of the allowance for doubtful debts in the financial statements of the Group and of the Company inadequate to any substantial extent; or

(ii) which would render the values attributed to current assets in the financial statements of the Group and of the Company misleading; or (iii) which have arisen which render adherence to the existing method of valuation of assets or liabilities of the Group and of the Company misleading or inappropriate. (c) As at the date of this report: (i)

there are no charges on the assets of the Group and of the Company which have arisen since the end of the financial year to secure the liability of any other person; and

(ii) there are no contingent liabilities in the Group or in the Company which have arisen since the end of the financial year. Computer Forms (Malaysia) Berhad (4423-H)

Annual Report 2009

21

DIRECTORS’ REPORT

for the financial year ended 31 March 2009 (continued)

STATUTORY INFORMATION ON THE FINANCIAL STATEMENTS (continued) THOR POH (d) At theSENG date of this report, the directors are not aware of any circumstances not otherwise dealt with in the Independent Non-Executive Director report or financial statements which would render any amount stated in the financial statements misleading. (e) No contingent or other liability has become enforceable, or is likely to become enforceable, within the period of twelve months after the end of the financial year which, in the opinion of the directors, will or may substantially affect the ability of the Group or of the Company to meet their obligations as and when they fall due. (f)

In the opinion of the directors: (i)

the results of the operations of the Group and of the Company during the financial year were not substantially affected by any item, transaction or event of a material and unusual nature.

(ii) no item, transaction or event of a material and unusual nature has arisen in the interval between the end of the financial year and the date of this report which is likely to affect substantially the results of the operations of the Group and of the Company for the current financial year in which this report is made.

AUDITORS The auditors, Messrs Paul Chuah & Co., have indicated their willingness to continue in office.

On behalf of the board

MUHAYUDDIN BIN MUSA

OU WEE SUN Kuala Lumpur Date: 22 JULY 2009

22

Annual Report 2009

Computer Forms (Malaysia) Berhad (4423-H)

STATEMENT BY

DIRECTORS

STATEMENT BY DIRECTORS In the opinion of the directors, the financial statements set out on pages 20 to 64 are drawn up in accordance with the provisions of the Companies Act, 1965 and the applicable Financial Reporting Standards in Malaysia so as to give a true and fair view of the state of affairs of the Group and of the Company as at 31 March 2009 and of the results and cash flows of the Group and of the Company for the year then ended. Signed in accordance with a resolution of the directors

MUHAYUDDIN BIN MUSA

OU WEE SUN

Kuala Lumpur Date: 22 JULY 2009

STATUTORY

DECLARATION

STATUTORY DECLARATION I, Lee Yu Jin, being the officer responsible for the financial management of Computer Forms (Malaysia) Berhad, do solemnly and sincerely declare that to the best of my knowledge and belief, the financial statements set out on pages 20 to 64 are correct and I make this solemn declaration conscientiously believing the same to be true and by virtue of the provisions of the Statutory Declarations Act, 1960.

LEE YU JIN Subscribed and solemnly declared at Kuala Lumpur, Wilayah Persekutuan on 22 JULY 2009 Before me:

AFFANDI BIN AHMAD (W 567) Commissioner for Oaths

Computer Forms (Malaysia) Berhad (4423-H)

Annual Report 2009

23

INDEPENDENT AUDITORS’ REPORT to the members of Computer Forms (Malaysia) Berhad (4423-H) Report on the Financial Statements We have THOR POHaudited SENG the financial statements of Computer Forms (Malaysia) Berhad, which comprise the balance sheet as at 31 March 2009 of the Director Group and of the Company, and the income statement, statement of changes in equity Independent Non-Executive and cash flow statement of the Group and of the Company for the year then ended, and a summary of significant accounting policies and other explanatory notes, as set out on pages 20 to 64. Directors’ Responsibility for the Financial Statements The directors of the Company are responsible for the preparation and fair presentation of these financial statements in accordance with applicable Financial Reporting Standards and the Companies Act 1965 in Malaysia. This responsibility includes: designing, implementing and maintaining internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatements, whether due to fraud or error; selecting and applying appropriate accounting policies; and making accounting estimates that are reasonable in the circumstances. Auditors’ Responsibility Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with approved standards on auditing in Malaysia. Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance whether the financial statements are free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on our judgment, including the assessment of risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, we consider internal controls relevant to the Company’s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal controls. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by the director, as well as evaluating the overall presentation of the financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion. Opinion In our opinion, the financial statements have been properly drawn up in accordance with applicable Financial Reporting Standards and the Companies Act, 1965 in Malaysia so as to give a true fair view of the financial position of the Group and of the Company as of 31 March 2009 and of their financial performance and cash flows for the year then ended.

Reporting on Other Legal and Regulatory Requirements In accordance with the requirements of the Companies Act, 1965 in Malaysia, we also report the following: a)

b) c)

d)

24

In our opinion, the accounting and other records and the registers required by the Act to be kept by the Company and its subsidiaries of which we have acted as auditors have been properly kept in accordance with the provisions of the Act. We have considered the accounts and the auditors’ report of the subsidiary of which we have not acted as auditors, which are indicated in note 11 to the financial statements. We are satisfied that the accounts of the subsidiaries that have been consolidated with the Company’s financial statements are in form and content appropriate and proper for the purposes of the preparation of the financial statements of the Group and we have received satisfactory information and explanations required by us for those purposes. The audit reports on the accounts of the subsidiaries did not contain any qualification or any adverse comment made under Section 174(3) of the Act.

Annual Report 2009

Computer Forms (Malaysia) Berhad (4423-H)

INDEPENDENT AUDITORS’ REPORT

to the members of Computer Forms (Malaysia) Berhad (4423-H) (continued)

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

PAUL CHUAH & CO.

NOR IZAN BINTI KUSHAIRI

No. AF 1056 Chartered Accountants

No. 1849/08/09(J) Partner of the firm

Kuala Lumpur Date: 22 JULY 2009

Computer Forms (Malaysia) Berhad (4423-H)

Annual Report 2009

25

CONSOLIDATED

INCOME STATEMENT for the year ended 31 March 2009

NOTE

2009 RM

2008 RM

5

48,154,693

45,775,756

COST OF SALES

(39,493,645)

(37,337,667)

GROSS PROFIT

8,661,048

8,438,059

482,502

1,049,022

REVENUE

OTHER INCOME DISTRIBUTION COSTS

(2,314,731)

(2,166,502)

ADMINISTRATION EXPENSES

(1,654,129)

(1,899,287)

OPERATING EXPENSES

(2,217,402)

(2,311,024)

PROFIT FROM OPERATIONS

2,957,288

3,110,268

FINANCE COSTS

(1,628,607)

(1,832,902)

1,328,681

1,277,366

PROFIT BEFORE TAXATION

6

TAXATION

7

PROFIT FOR THE YEAR

(818,013)

(31,098)

510,668

1,246,268

EQUITY HOLDERS OF THE COMPANY

190,195

1,115,544

MINORITY INTEREST

320,473

130,724

510,668

1,246,268

ATTRIBUTABLE TO:

EARNINGS PER SHARE (sen) - basic

8

0.46

2.72

- diluted

8

0.46

2.72

The accompanying notes are an integral part of these financial statements.

26

Annual Report 2009

Computer Forms (Malaysia) Berhad (4423-H)

CONSOLIDATED BALANCE SHEET as at 31 March 2009

NOTE

2009 RM

2008 RM

9 10 12 13

22,065,484 18,711,653 4,623 1,309,392

23,788,046 19,001,378 9,160 1,309,392

42,091,152

44,107,976

14,263,241 9,918,951 5,000,000 70,296 4,925,377

16,375,075 9,595,965 479,985 349,879 3,653,566

34,177,865

30,454,470

76,269,017

74,562,446

41,000,000 4,774,331 (3,303,654)

41,000,000 4,831,853 (3,551,371)

42,470,677

42,280,482

1,062,112

741,639

43,532,789

43,022,121

10,919,964 2,059,171

19,680,049 1,825,052

12,979,135

21,505,101

4,243,953 15,413,090 100,050

3,585,941 6,205,189 244,094

19,757,093

10,035,224

TOTAL LIABILITIES

32,736,228

31,540,325

TOTAL EQUITY AND LIABILITIES

76,269,017

74,562,446

ASSETS NON-CURRENT ASSETS Property, plant and equipment Prepaid land lease payments Other investment Goodwill on consolidation

CURRENT ASSETS Inventories Trade and other receivables Margin deposits with a licensed bank Fixed deposits with a licensed bank Tax recoverable Cash and bank balances

14 15 16

TOTAL ASSETS EQUITY AND LIABILITIES EQUITY ATTRIBUTABLE TO EQUITY HOLDERS OF THE COMPANY Share capital Revaluation reserve Accumulated losses

17

MINORITY INTEREST TOTAL EQUITY NON-CURRENT LIABILITIES Long term borrowings Deferred taxation

CURRENT LIABILITIES Trade and other payables Short term borrowings Taxation

Computer Forms (Malaysia) Berhad (4423-H)

23 20

21 23

Annual Report 2009

27

CONSOLIDATED STATEMENT OF

CHANGES IN EQUITY for the year ended 31 March 2009

Attributable to equity holders of the Company Revaluation

Share reserve - Non capital distributable RM RM

Accumulated losses RM

Total RM

41,000,000

4,762,414

Surplus on revaluation reserve

-

69,439

-

69,439

-

69,439

Net income and expense recognised directly in equity

-

69,439

-

69,439

-

69,439

Profit for the year

-

-

1,115,544

1,115,544

130,724

1,246,268

Total recognised income and expense for the year

-

69,439

1,115,544

1,184,983

130,724

1,315,707

Balance at 31 March 2008

41,000,000

4,831,853

(3,551,371)

42,280,482

741,639

43,022,121

Balance at 1 April 2008

41,000,000

4,831,853

(3,551,371)

42,280,482

741,639

43,022,121

Realisation of revaluation reserve

-

(57,522)

57,522

-

-

-

Net income and expense recognised directly in equity

-

(57,522)

57,522

-

-

-

Profit for the year

-

190,195

190,195

320,473

510,668

Total recognised income and expense for the year

-

(57,522)

247,717

190,195

320,473

510,668

41,000,000

4,774,331

(3,303,654)

42,470,677

1,062,112

43,532,789

Balance at 31 March 2009

41,095,499

Minority interest RM

Balance at 1 April 2007

-

(4,666,915)

Total RM

610,915 41,706,414

The accompanying notes are an integral part of these financial statements.

28

Annual Report 2009

Computer Forms (Malaysia) Berhad (4423-H)

CONSOLIDATED CASH FLOW STATEMENT for the year ended 31 March 2009

NOTE CASH FLOWS FROM OPERATING ACTIVITIES Profit before taxation Adjustments for: Allowance for diminution in value of other investments Revaluation surplus on property Amortisation of prepaid land lease payments Allowance for diminution value of other investment no longer required Allowance for doubtful debts Allowance for doubtful debts no longer required Bad debts written off Depreciation Deposit written off Other investment written off Loss on disposal of investment Inventories written down/off Interest expense Interest income Property, plant and equipment written off Profit from disposal of property, plant and equipment and prepaid land lease payments Unrealised (gain)/loss on foreign exchange

2009 RM

2008 RM

1,328,681

1,277,366

4,537 289,725 (18,337) 17,880 2,225,020 289,558 1,628,607 (44,919) 31,325

(262,045) 311,990 (129,840) 19,597 (298,390) 49,803 2,229,173 5,100 10,000 29,440 423,763 1,832,902 (23,268) 9,653

(21,438)

(96,325) 16,173

Profit before working capital changes

5,730,639

5,405,092

Working capital changes: Inventories Trade and other receivables Trade and other payables

1,822,276 (305,729) 663,002

(2,698,210) (5,971) 60,136

Cash inflows from operations

7,910,188

2,761,047

44,919 (1,628,607) (448,354)

23,268 (1,832,902) 558,567

5,878,146

1,509,980

479,985 -

(479,985) 242,944

(448,515)

2,997,560 (987,835)

31,470

1,772,684

Interest received Interest paid Tax (paid)/refund Net cash inflows from operating activities CASH FLOWS FROM INVESTING ACTIVITIES Uplift/(placement) of margin deposits Proceeds from disposal of investment Proceeds from disposal of prepaid land lease payment and property, plant and equipment Purchase of property, plant and equipment Net cash inflows from investing activities

Computer Forms (Malaysia) Berhad (4423-H)

A

Annual Report 2009

29

CONSOLIDATED

CASH FLOW STATEMENT

for the year ended 31 March 2008 (continued)

NOTE CASH FLOWS FROM FINANCING ACTIVITIES Repayment of hire purchase payables Repayment of bills payable Drawndown/(repayment) of bankers acceptances Repayment of term loan Net cash inflows/(outflows) from financing activities EFFECTS OF EXCHANGE RATE CHANGES ON CASH AND CASH EQUIVALENTS NET INCREASE/(DECREASE) IN CASH AND CASH EQUIVALENTS

2009 RM

2008 RM

(398,633) 2,707,000 (2,000,000)

(323,534) (220,126) (153,000) (3,770,000)

308,367

(4,466,660)

(353)

-

6,217,983

(1,183,996)

CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR

B

2,976,679

4,160,675

CASH AND CASH EQUIVALENTS AT END OF YEAR

B

9,194,309

2,976,679

The accompanying notes are an integral part of these financial statements.

30

Annual Report 2009

Computer Forms (Malaysia) Berhad (4423-H)

NOTES TO THE CONSOLIDATED CASH FLOW STATEMENT for the year ended 31 March 2009

A.

PROPERTY, PLANT AND EQUIPMENT During the financial year, the Group acquired the property, plant and equipment by: 2009 RM

2008 RM

448,515 85,268

987,835 684,000

533,783

1,671,835

2009 RM

2008 RM

Bank overdraft Fixed deposits with licensed banks Cash and bank balances

(731,068) 5,000,000 4,925,377

(676,887) 3,653,566

Total cash and cash equivalents

9,194,309

2,976,679

Cash Hire purchase

B.

CASH AND CASH EQUIVALENTS

Computer Forms (Malaysia) Berhad (4423-H)

Annual Report 2009

31

INCOME

STATEMENT

for the year ended 31 March 2009

NOTE

2009 RM

2008 RM

5

17,376,563

18,143,522

COST OF SALES

(12,177,247)

(12,863,086)

GROSS PROFIT

5,199,316

5,280,436

OTHER INCOME DISTRIBUTION COSTS ADMINISTRATION EXPENSES OPERATING EXPENSES

(986,539) (715,341) (1,240,298)

156,046 (1,070,542) (959,091) (1,173,156)

PROFIT FROM OPERATIONS

2,257,138

2,233,693

FINANCE COSTS

(1,464,894)

(1,698,262)

REVENUE

PROFIT BEFORE TAXATION

6

792,244

535,431

TAXATION

7

(254,634)

(521,134)

537,610

14,297

537,610

14,297

PROFIT FOR THE YEAR ATTRIBUTABLE TO: EQUITY HOLDERS OF THE COMPANY

The accompanying notes are an integral part of these financial statements.

32

Annual Report 2009

Computer Forms (Malaysia) Berhad (4423-H)

BALANCE SHEET

as at 31 March 2009

NOTE

2009 RM

2008 RM

9 10 11

5,277,326 4,718,876 84,439,976

5,422,222 4,775,730 52,732,484

94,436,178

62,930,436

4,320,524 4,734,780 253,801 1,638,600

RM 4,649,322 15,821,661 490,110

10,947,705

20,961,093

105,383,883

83,891,529

41,000,000 4,774,331 9,670,385

41,000,000 4,831,853 9,075,253

55,444,716

54,907,106

9,960,000 2,238,000

18,293,333 2,280,849

12,198,000

20,574,182

23,230,099 14,511,068

2,902,980 182,707 5,324,554

37,741,167

8,410,241

49,939,167

28,984,423

105,383,883

83,891,529

ASSETS NON – CURRENT ASSETS Property, plant and equipment Prepaid land lease payments Subsidiary companies

CURRENT ASSETS Inventories Trade and other receivables Tax recoverable Cash and bank balances

14 15

TOTAL ASSETS EQUITY AND LIABILITIES EQUITY ATTRIBUTABLE TO EQUITY HOLDERS OF THE COMPANY Share capital Revaluation reserve Retained profits

17

TOTAL EQUITY NON- CURRENT LIABILITIES Long term borrowings Deferred taxation

CURRENT LIABILITIES Trade and other payables Taxation Short term borrowings

TOTAL LIABILITIES TOTAL EQUITY AND LIABILITIES

23 20

21 23

The accompanying notes are an integral part of these financial statements.

Computer Forms (Malaysia) Berhad (4423-H)

Annual Report 2009

33

STATEMENT OF

CHANGES IN EQUITY for the year ended 31 March 2009

Attributable to equity holders of the Company Share capital RM

Revaluation reserve - non distributable RM

41,000,000

4,762,414

Surplus on revaluation reserve

-

69,439

-

69,439

Net income and expense recognised directly in equity

-

69,439

-

69,439

Profit for the year

-

-

14,297

14,297

Total recognised income and expense for the year

-

69,439

14,297

83,736

Balance at 31 March 2008

41,000,000

4,831,853

9,075,253 54,907,106

At 1 April 2008

41,000,000

4,831,853

9,075,253 54,907,106

At 1 April 2007

Retained profits RM

Total RM

9,060,956 54,823,370

Realisation of revaluation reserve

-

(57,522)

57,522

-

Net income and expense recognised directly in equity

-

(57,522)

57,522

-

Profit for the year

-

537,610

537,610

Total recognised income and expense for the year

-

595,132

537,610

Balance at 31 March 2009

41,000,000

(57,522) 4,774,331

9,670,385 55,444,716

The accompanying notes are an integral part of these financial statements.

34

Annual Report 2009

Computer Forms (Malaysia) Berhad (4423-H)

CASH FLOW STATEMENT

for the year ended 31 March 2009 2009 RM

2008 RM

792,244

535,431

56,854 391,003 (1,435,200) 1,464,894 26,210 80,389

(122,293) 56,854 46,081 639,776 (236,100) 1,698,262 1,280 189,102

1,376,394

2,808,393

Working capital changes: Inventories Trade and other receivables Trade and other payables

248,409 904,427 33,239

126,710 17 166,991

Cash inflows from operations

2,562,469

3,102,111

(1,464,894) (375,191)

(1,698,262) 258,734

NOTE CASH FLOWS FROM OPERATING ACTIVITIES Profit before taxation Adjustments for: Allowance for doubtful debts no longer required Amortisation of prepaid land lease payments Bad debts written off Depreciation Dividend income Interest expenses Property, plant and equipment written off Inventories written off Profit before working capital changes

Interest paid Tax (paid)/refund Net cash inflows from operating activities

722,384

1,662,583

CASH FLOWS FROM INVESTING ACTIVITIES Investment in subsidiary companies Repayment from/(loan to) subsidiary companies Dividend received Proceeds from disposal of property, plant and equipment Purchase of property, plant and equipment

(31,707,492) 10,182,454 1,076,400 (272,317)

(77,485) 174,714 2,041 (66,947)

Net cash (outflows)/inflows from investing activities

(20,720,955)

32,323

CASH FLOWS FROM FINANCING ACTIVITIIES Loan from subsidiary companies Drawdown of banker acceptances Repayment of term loan

20,293,880 2,799,000 (2,000,000)

1,075,756 413,000 (3,770,000)

Net cash inflows/(outflows) from financing activities

21,092,880

(2,281,244)

Computer Forms (Malaysia) Berhad (4423-H)

Annual Report 2009

35

CASH FLOW STATEMENT

for the year ended 31 March 2009 (continued)

NOTE NET INCREASE/(DECREASE) IN CASH AND CASH EQUIVALENTS

2009 RM 1,094,309

2008 RM (586,338)

CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR

A

(186,777)

399,561

CASH AND CASH EQUIVALENTS AT END OF YEAR

A

907,532

(186,777)

NOTE

2009 RM

2008 RM

A.

CASH AND CASH EQUIVALENTS

Cash and bank balances Bank overdraft Total cash and cash equivalents

1,638,600 (731,068)

490,110 (676,887)

907,532

(186,777)

The accompanying notes are an integral part of these financial statements.

36

Annual Report 2009

Computer Forms (Malaysia) Berhad (4423-H)

NOTES TO THE

FINANCIAL STATEMENTS

for the year ended 31 March 2009

1.

BASIS OF PREPARATION (a)

Statement of compliance Computer Forms (Malaysia) Berhad is a public listed company incorporated and domiciled in Malaysia and quoted on the Second Board of Bursa Malaysia Securities Berhad. The financial statements were authorised for issue by the Board of Directors in accordance with a resolution of the directors on 22 July 2009.

(b)

Basis of preparation The financial statements are prepared under the historical cost convention unless otherwise indicated in the accounting policies below. The financial statements comply with the provisions of the Companies Act, 1965 and applicable Financial Reporting Standards in Malaysia. The following new FRSs, Interpretations and Amendments to published standards have been issued but are not yet effective and are not expected to have any material impact on the financial statements. Hence no further disclosure is warranted: Standard/Interpretation FRS 8 – Operating Segments

Effective date 1 July 2009

Amendments to FRS 1 – First Time Adoption of Financial Reporting Standards and FRS 127 - Consolidated and Separate Financial Statements: Cost of an investment in a Subsidiary, Jointly Controlled Entity or Associate

1 January 2010

Amendments to FRS 2 – Share Based Payment: Vesting conditions and cancellations

1 January 2010

FRS 123 – Borrowing Costs

1 January 2010

IC Interpretation 9 – Reassessment of Embedded Derivatives

1 January 2010

IC Interpretation 10 – Interim Financial Reporting and Impairment

1 January 2010

IC Interpretation 11 – FRS 2 – Group and Treasury Share Transactions

1 January 2010

The Company has not early adopted FRS 7 – Financial Instruments: Disclosures, and FRS 139 Financial Instruments: Recognition and Measurement which are only effective for financial periods beginning on or after 1 January 2010, in line with transitional provisions in FRS 7 and FRS 139 the Company is exempted from the need to disclose the possible impact arising from the initial application of these standards on its financial statements.

Computer Forms (Malaysia) Berhad (4423-H)

Annual Report 2009

37

NOTES TO THE FINANCIAL STATEMENTS for the year ended 31 March 2009 (continued) 1.

BASIS OF PREPARATION (continued) (b)

Basis of preparation (continued) The following new FRSs and Interpretations have been issued but are not yet effective and not relevant to the Company’s operations:

(c)

Standard/Interpretation

Effective date

FRS 4 – Insurance Contracts

1 January 2010

IC Interpretation 13 – Customer Loyalty Programmes

1 January 2010

IC Interpretation 14 – FRS 119 – The Limit on Defined Benefit Asset, Minimum Funding Requirement and their Interaction

1 January 2010

Functional and presentation currency The financial statements are presented in Ringgit Malaysia which is the Group’s and the Company’s functional and presentation currency.

(d)

Use of estimates and judgments The preparation of financial statements requires management to make judgments, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities, income and expenses. Actual results may differ from these estimates. Estimates and underlying assumptions are reviewed on an on-going basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised and in any future periods affected. In particular, information about significant areas of estimation uncertainty and critical judgments in applying accounting policies that have the most significant effect on the amounts recognised in the financial statements are described in the following notes: • • •

2.

Note 12 Note 14 Note 15 -

allowance for diminution in value of other investment inventories write-down allowance for doubtful debts

SIGNIFICANT ACCOUNTING POLICIES a)

Basis of consolidation The consolidated financial statements incorporate the financial statements of the Company and its subsidiary companies made up to the end of the financial year. The results of subsidiary companies acquired or disposed during the year are included in the consolidated income statement from the date that control commences until the date that control ceases. All material intra group transactions, intra group balances and resulting unrealised profits or losses are eliminated fully on consolidation. Uniform accounting policies are adopted in the consolidated financial statements for like transactions and events in similar circumstances. Any excess of the cost of the acquisition over the Group’s interest in the net fair value of the identifiable assets, liabilities and contingent liabilities represents goodwill. Any excess of the Group’s interest in the fair value of the identifiable assets, liabilities and contingent liabilities over the cost of acquisition is recognised immediately in income statement.

38

Annual Report 2009

Computer Forms (Malaysia) Berhad (4423-H)

NOTES TO THE

FINANCIAL STATEMENTS

for the year ended 31 March 2009 (continued)

2.

SIGNIFICANT ACCOUNTING POLICIES (continued) (a)

Basis of consolidation (continued) Minority interests at the balance sheet date, being the portion of the net assets of subsidiaries attributable to equity interests that are not owned by the Company, whether directly or indirectly through subsidiaries, are presented in the consolidated balance sheet and statement of changes in equity within equity, separately from equity attributable to the equity shareholders of the Company. Minority interest in the results of the Group is presented on the face of the consolidated income statement as an allocation of the total profit or loss for the year between minority interest and the equity shareholders of the Company. Losses applicable to the minority in excess of the minority’s interest in the subsidiary’s equity are allocated against the interest of the Group except to the extent that the minority has a binding obligation and is able to make an additional investment to cover the losses.

(b)

Subsidiary companies The Company regards as subsidiary companies those companies in which it holds long term equity interest of more than 50% and/or where it is in a position to control the financial and operating policies. The existence and effect of potential voting rights that are currently exercisable or convertibles are considered when assessing whether the Group has such power over another entity. Investments in subsidiary companies are stated at cost. Where an indication of impairment exists, the carrying amount of the subsidiary company is assessed and written down immediately to its recoverable amount.

(c)

Goodwill Goodwill is initially measured at cost. Following the initial recognition, goodwill is measured at cost less accumulated impairment losses, if any. Goodwill is allocated to cash generating units and is tested for impairment annually or more frequently if event or changes in circumstances indicate that the carrying value might be impaired. Gains and losses on the disposal of an entity include the carrying amount of goodwill relating to the entity sold is recognised immediately in income statement.

(d)

Property, plant and equipment All items of property, plant and equipment are initially recorded at costs. Subsequent costs are included in the assets’ carrying amounts or recognised as separate assets, as appropriate, only when it is probable that future economic benefits associated with the items will flow to the Company and the costs of the items can be measured reliably. The carrying amount of the replaced part is derecognised. All other repairs and maintenance are recognised in the income statement as incurred. Subsequent to recognition, property, plant and equipment are stated at cost less accumulated depreciation and accumulated impairment losses, if any. Surplus arising from revaluation is credited directly to revaluation reserve. Deficit in excess of the revaluation reserve arising from previous revaluation is recognised in the income statement. On disposal of revalued assets, amounts in revaluation reserve relating to those assets are transferred to retained profits. Revaluation of properties is undertaken every 5 years. Leasehold buildings are amortised over the lease period between 12 to 85 years. Depreciation is provided for on a straight-line basis to write off the cost of each assets to its residual value over the estimated useful lives, at the following annual rates: % Plant and machinery 10 – 20 Furniture, fittings, equipment and renovations 5 – 33.33 Motor vehicles 20

Computer Forms (Malaysia) Berhad (4423-H)

Annual Report 2009

39

NOTES TO THE FINANCIAL STATEMENTS for the year ended 31 March 2009 (continued) 2.

SIGNIFICANT ACCOUNTING POLICIES (continued) d)

Property, plant and equipment (continued) During the year ended 31 March 2009, a subsidiary company conducted an operational review on the its plant and machinery and computers and software. The expected usage life of the plant and machinery and computers and software, which management previously estimated to be 8 – 10 years and 4 years respectively, is now reduced to 5 – 10 years and 3 years respectively. The effect of this change on depreciation expense of the Group is as follows:

Plant and machinery Increase/(decrease) in depreciation expense Furniture, fittings, equipment and renovation -Computers and software Increase/(decrease) in depreciation expense

2009

2010

2011

RM

RM

RM

291,508

291,508

167,475

8,980

7,108

(5,796)

2012

2013 and after RM RM

54,618

(10,292)

(805,109)

-

The residual values, useful lives and depreciation method are reviewed at each financial year end to ensure that the amount, method and period of depreciation are consistent with previous estimates and the expected pattern of consumption of the future economic benefits embodied in the items of property, plant and equipment. An item of property, plant and equipment is derecognised upon disposal or when no future economic benefits are expected from its use or disposal. The difference between the net disposal proceeds, if any and the net carrying amount is recognised in the income statement and the unutilised portion of the revaluation surplus on that item is taken directly to retained earnings. Where an indication of impairment exists, the carrying amount of the asset is assessed and written down immediately to its recoverable amount. (e)

Investments Investments in quoted shares are stated at cost less allowance for diminution in value, if any, where in the opinion of the directors that there is an impairment loss that is other than temporary on the value of such investments.

(f)

Inventories Inventories are valued at the lower of cost and net realisable value. Cost of raw materials and consumables comprise the original costs of purchase and the costs of bringing the inventories to its present location and condition. Cost of finished goods and work-in-progress comprise direct materials, direct labour and an appropriate proportion of production overheads based on normal operating capacity. Cost is determined on a “first in, first out” basis. Net realisable value is the estimated selling price in the ordinary course of business less the estimated cost of completion and the estimated cost necessary to make the sale.

40

Annual Report 2009

Computer Forms (Malaysia) Berhad (4423-H)

NOTES TO THE

FINANCIAL STATEMENTS

for the year ended 31 March 2009 (continued)

2.

SIGNIFICANT ACCOUNTING POLICIES (continued) (g)

Foreign currencies Transactions in foreign currencies are translated to the functional currencies of the Group and the Company using the exchange rates prevailing at the dates of the transactions. At each balance sheet date, foreign monetary items are translated using the exchange rate prevailing at that date. Non-monetary items measured at fair value are translated using the exchange rate prevailing at the date when fair value was determined. Non- monetary items measured at historical costs are translated using the exchange rate at the date of transaction. Foreign currency differences arising from translation are recognised in the income statement. The principal closing rates used to translate each unit of foreign currency into Ringgit Malaysia are as follows: As at 31/3/2009 As at 31/3/2008 RM RM Singapore Dollar 2.4345 2.3375 US Dollar 3.6920 3.2310

(h)

Taxes Tax charged on the profit or loss for the year comprises current and deferred taxes. Current year tax is the expected amount of income taxes payable in respect of the taxable profit for the year and is measured using the tax rates that have been enacted at the balance sheet date. Deferred tax liabilities and assets are provided for under the liability method in respect of temporary differences between the carrying amount of an asset or liability in the balance sheet and its tax base including unused tax losses and capital allowances. Deferred tax is measured at the tax rates that are expected to apply in the period when the asset is realised or the liability is settled, based on the tax laws that have been enacted or substantively enacted at the balance sheet date. A deferred tax asset is recognised only to the extent that it is probable that taxable profit will be available against which the deductible temporary differences can be utilised. The carrying amount of a deferred tax asset is reviewed at each balance sheet date. If it is no longer probable that sufficient taxable profit will be available to allow the benefit of part or all of that deferred tax asset to be utilised, the carrying amount of the deferred tax asset will be reduced accordingly. When it becomes probable that sufficient taxable profit will be available, such reductions will be reversed to the extent of the taxable profit.

(i)

Revenue recognition Revenue from sales of goods is recognised when the risks and rewards of ownership of the goods have been transferred to the buyers. Dividend income is recognised when the right to receive payment has been established. Income from rental and fixed deposits are recognised on accrual basis.

(j)

Impairment of assets The carrying amounts of the Group’s and Company’s assets other than inventories, deferred tax assets and financial assets, are reviewed at each balance sheet date to determine whether there is any indication of impairment. If any such indication exists, the asset’s recoverable amount is estimated and an impairment loss is recognised whenever the recoverable amount is less than the carrying amount of the asset. The impairment loss is recognised in the income statement immediately except for the impairment on a revalued assets where the impairment loss is recognised directly against the revaluation surplus account to the extent of the surplus credited from the previous revaluation for the same assets with the excess of the impairment loss charged to the income statement. All reversals of an impairment loss are recognised as income immediately in the income statement except for the reversal of an impairment loss on a revalued assets where the reversal of the impairment loss is treated as a revaluation increase and credited to the revaluation surplus account of the same asset.

Computer Forms (Malaysia) Berhad (4423-H)

Annual Report 2009

41

NOTES TO THE FINANCIAL STATEMENTS for the year ended 31 March 2009 (continued) 2.

SIGNIFICANT ACCOUNTING POLICIES (continued) (k)

Employee benefits (i)

Short term employee benefits Wages, salaries, bonuses and social security contribution are recognised as an expense in the year in which the associated services are rendered by employees of the Group and the Company.

(ii)

Defined contribution plans As required by law, companies in Malaysia make contributions to the state pension scheme, the Employees Provident Fund (“EPF”).

(iii)

Share-based payment transactions The Employee Share Options Scheme (“ESOS”) allows Group’s and Company’s employees to acquire ordinary shares of the Company. Share options granted to employees is not recognised as an employee cost as explain in note 27. Following the adoption of FRS 2 share-based payment, the fair value of share options granted to employee is recognised as an employee expense, with a corresponding increase in equity, over the period in which the employee becomes unconditionally entitled to the options.

(l)

Financial instruments Financial instruments are recognised in the balance sheet when the Group and the Company has become a party to the contractual provisions of the instrument. A financial asset is any asset that is cash, a contractual right to receive cash or another financial asset from another enterprise, a contractual right to exchange financial instruments with another enterprise under conditions that are potentially favourable, or an equity instrument of another enterprise. A financial liability is any liability that is a contractual obligation to deliver cash or another financial asset to another enterprise, or to exchange financial instruments with another enterprise under conditions that are potentially unfavourable. An equity instrument is any contract that evidences a residual interest in the assets of an enterprise after deducting all its liabilities. Financial instruments are classified as liabilities or equity in accordance with the substance of the contractual arrangement. Interest, dividends and gains and losses relating to a financial instrument classified as a liability, are reported as expense or income. Distributions to holders of financial instruments classified as equity are recognised directly in equity. Financial instruments are offset when the Company has a legally enforceable right to offset and intends to settle either on a net basis or to realise the asset and settle the liability simultaneously. (i)

Receivables Receivables are initially recognised at their cost when the contractual right to receive cash or another asset from another entity is established. Subsequent to recognition, known bad debts are written off and specific allowance is made for any debts considered to be doubtful of collection.

(ii)

Cash and cash equivalents Cash comprises cash on hand and demand deposits. Cash equivalents are short term, highly liquid investments that are readily convertible to cash with insignificant risk of changes in value.

42

Annual Report 2009

Computer Forms (Malaysia) Berhad (4423-H)

NOTES TO THE

FINANCIAL STATEMENTS

for the year ended 31 March 2009 (continued)

2.

SIGNIFICANT ACCOUNTING POLICIES (continued) (l)

(m)

Financial instruments (continued) (iii)

Payables Payables are measured initially and subsequently at cost. Payables are recognised when there is a contractual obligation to deliver cash or another financial asset to another entity.

(iv)

Dividends Dividends on ordinary shares are recognised as liabilities when the obligation to pay is established.

(v)

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

Leases (i)

(ii)

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

Property held under operating leases that would otherwise meet the definition of an investment property is classified as an investment on a property-by-property basis and, if classified as investment property, is accounted for as if held under a finance lease.

-

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

Operating leases – the Group and the Company as lessee Operating lease payments are recognised as an expense on a straight-line basis over the term of the relevant lease. The aggregate benefit of incentives provided by the lessor is recognised as a reduction of rental expense over the lease term on a straight-line basis. In the case of a lease of land and buildings, the minimum lease payments or the up-front payments made are allocated, whenever necessary, between the land and the buildings elements in proportion to the relative fair values for leasehold interests in the land element and buildings element of the lease at the inception of the lease. The up-front payment represents prepaid lease payments and are amortised on a straight-line basis over the lease term. Prepaid land lease payments are amortised over the lease periods between 17 to 90 years.

(iii)

(n)

Operating leases – the Group as lessor Assets leased out under operating leases are presented on the balance sheet according to the nature of the assets. Rental income from operating leases is recognised on straight-line basis over the term of the relevant lease. Initial direct costs incurred in negotiating and arranging an operating lease are added to the carrying amount of the leased asset and recognised on a straight-line basis over the lease term.

Hire purchase creditors Property, plant and equipment held under hire purchase are treated as if they had been purchased at cost at the commencement of the hire purchase agreement. This cost is included under property, plant and equipment and depreciation is provided accordingly. The corresponding obligations under hire purchase are included under liabilities. The finance charge element of installments payable is charged to the income statement using the sum of digit method.

Computer Forms (Malaysia) Berhad (4423-H)

Annual Report 2009

43

NOTES TO THE FINANCIAL STATEMENTS for the year ended 31 March 2009 (continued) 3.

FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES The Group’s and Company’s financial risk management policies seek to ensure that adequate financial resources are available for the development of the Group’s and Company’s business whilst managing financial risks. (a)

Credit risk Management monitors credit risk on an on going basis. The maximum exposure to credit risk for the Group and the Company is represented by the carrying amount of each financial assets.

(b)

Liquidity risk Management adopts a prudent liquidity risk management by maintaining sufficient liquid funds to meet financial commitments and obligations when they fall due at a reasonable cost.

(c)

Foreign exchange risk There is no formal hedging policy with respect to foreign exchange exposures. Exposure to currency risk are monitored on an ongoing basis and the Group and the Company endeavour to keep the net exposures at an acceptable level.

(d)

Interest rate risk The Group’s and the Company’s primary interest rate risk relates to interest bearing debts. The information on maturity dates and effective interest rates of financial liabilities are disclosed in their respective notes.

4.

FAIR VALUES The carrying amounts of the financial assets and financial liabilities of the Group and of the Company at the balance sheet date approximate their fair values due to the relatively short term nature of those financial instruments except as disclosed in notes 12, 18, 19 and 26 of the financial statements.

5.

REVENUE GROUP

Revenue comprises: Invoiced value of goods sold net of returns and discounts Gross dividend income from subsidiary companies

44

Annual Report 2009

COMPANY

2009 RM

2008 RM

2009 RM

2008 RM

48,154,693

45,775,726

15,941,363

17,907,422

-

-

1,435,200

236,100

48,154,693

45,775,726

17,376,563

18,143,522

Computer Forms (Malaysia) Berhad (4423-H)

NOTES TO THE

FINANCIAL STATEMENTS

for the year ended 31 March 2009 (continued)

6.

PROFIT BEFORE TAXATION GROUP 2009 RM

COMPANY 2008 RM

2009 RM

2008 RM

311,990 5,100 10,000 19,597

56,854 -

56,854 -

77,950 1,100 49,803 2,229,173

36,500 391,003

36,500 46,081 639,776

65,200 469,603

52,000 414,287

65,200 397,603

109,531 13,278 1,619,647 90,446 423,763

13,333 1,395,745 55,816 80,389

13,058 1,619,647 65,557 189,102

9,653 10,212,229

26,210 4,511,879

1,280 4,725,617

(298,390)

-

30,000 11,070 (23,268) (262,045)

18,240 6,670 -

3,960 4,350 -

(96,325)

-

-

493

4,429

16,173 (12,000) (43,824)

-

-

29,440

-

-

(129,840)

-

-

-

-

Profit before taxation is stated after charging and (crediting): Amortisation of prepaid land lease payments 289,725 Deposit written off Other investment written off Allowance for doubtful debts Auditors’ remunerations: current year 79,400 underprovision in prior year Bad debts written off 17,880 Depreciation 2,225,020 Directors’ remuneration: fees 52,000 other emoluments* 486,287 Interest expenses: hire purchase 103,199 bank overdrafts 13,333 term loans 1,395,745 bankers’ acceptances 116,330 Inventories written down 78,638 Inventories written off 210,920 Property, plant and equipment written off 31,325 Staff costs* 10,163,562 Allowance for doubtful debts no longer required (18,337) Operating lease expenses: rental of premises**/+ 32,500 rental of office equipment**/+ 10,630 rental of forklift** 950 Interest income from fixed deposits (44,919) Revaluation surplus on property Profit from disposal of property, plant and equipment and prepaid land lease payments Realised (gain)/loss on foreign exchange (51,102) Unrealised (gain)/loss on foreign exchange (21,438) Rental income from machinery# (12,000) Rental income from buildings# (43,824) Loss on disposal of other investment Allowance for diminution in value of other investment no longer required Allowance for diminution in value of other investment 4,537

Computer Forms (Malaysia) Berhad (4423-H)

83,580

-

(122,293)

Annual Report 2009

45

NOTES TO THE FINANCIAL STATEMENTS for the year ended 31 March 2009 (continued) 6.

7.

PROFIT BEFORE TAXATION (continued) *

Included in staff costs and directors’ other emoluments of the Group and of the Company are amounts of RM971,159 and RM515,657 (2008: RM936,204 and RM526,998) respectively contributed to the Employees Provident Fund.

**

These are cancellable operating leases where the Group and the Company needs to give 0 - 3 months’ termination notice for these agreements.

+

Included in this operating lease expenses, there is a non-cancellable operating lease whose lease commitment is disclosed in note 28.

#

These are cancellable operating leases where the tenant needs to give three months’ termination notice to the Group.

TAXATION GROUP

COMPANY

2009 RM (a)

Current Malaysian taxation Deferred taxation (Note 20) Under/(over)provision of taxation in prior year

(b)

2008 RM

2009 RM

2008 RM

556,861 234,119

676,500 (613,133)

270,000 (42,849)

670,000 (132,333)

790,980

63,367

227,151

537,667

27,033

(32,269)

27,483

(16,533)

818,013

31,098

254,634

521,134

2009 RM

2008 RM

2009 RM

2008 RM

1,328,681

1,277,366

792,244

535,431

317,949

198,061

139,212

609,921

35,026

422,547

(22,763)

-

-

10,319 -

-

Reconciliation of tax expense and accounting profit: GROUP

Accounting profit

Tax at the applicable tax rate 838,986 Tax effect of expenses that are not deductible in determining taxable profit 174,952 Tax effect of income that are not included in determining taxable profit (199,912) Adjustment to opening deferred tax resulting from movement in income tax rate Double deduction of expenses (970) Under/(over)provision of deferred tax liabilities in prior year 8,932 Movement from unrecognised deferred assets (31,008) Current tax expense

790,980

COMPANY

(225,051) (627,008) 63,367

(5,936)

(23,587) (505)

-

-

227,151

537,667

The current corporate tax rate is 25% of chargeable income (2008: 26%). Consequently deferred tax liabilities in note 20 are measured using this tax rate.

46

Annual Report 2009

Computer Forms (Malaysia) Berhad (4423-H)

NOTES TO THE

FINANCIAL STATEMENTS

for the year ended 31 March 2009 (continued)

7.

TAXATION (continued) (c)

In accordance with the Finance Act 2007, tax on a company’s profit is a final tax and dividends distributed to shareholders will be exempted from tax (“single tier tax system”). However there is a transitional period of six years, expiring on 31 December 2013, to allow companies to pay franked dividends to their shareholders under limited circumstances. Companies with tax credit under Section 108 of the Income Tax Act, 1967 are also given an irrevocable option to elect for the single tier tax system. The Company did not exercise the option to elect for the single tier tax system. The Company has sufficient tax credits under Section 108 of the Income Tax Act, 1967 to frank the payment of cash dividends out of all of its retained profits as at year-end.

(d)

8.

The Company has tax exempt income of RM11,178,000 available for distribution by way of tax exempt dividends.

EARNINGS PER SHARE a)

Basic earnings per share The basic earnings per share is calculated based on the consolidated profit for the year attributable to equity holders of the Company of RM190,195 (2008: RM1,115,544) and the weighted average of 41,000,000 (2008: 41,000,000) ordinary shares issued and paid up during the financial year.

b)

Diluted earnings per share The fully diluted earnings per share is calculated based on the consolidated profit for the year attributable to equity holders of the Company of RM190,195 (2008: RM1,115,544) and the weighted average of 41,000,000 (2008: 41,000,000) ordinary shares issued and paid up during the financial year because the number of shares that would have been issued arising from the exercise of the share options is anti-dilutive.

Computer Forms (Malaysia) Berhad (4423-H)

Annual Report 2009

47

NOTES TO THE FINANCIAL STATEMENTS for the year ended 31 March 2009 (continued) 9.

PROPERTY, PLANT AND EQUIPMENT

GROUP 2009 At cost or valuation At 1 April 2008 Additions Written off At 31 March 2009

Long term leasehold buildings RM

Short term leasehold buildings RM

Motor vehicles RM

10,200,000 10,200,000

3,200,000 3,200,000

758,687 758,687

3,200,000 3,200,000

Furniture, fittings, equipment and renovations RM

Plant and machinery RM

Total RM

4,367,767 184,774 (692,256) 3,860,285

46,710,635 349,009 (2,380,894) 44,678,750

65,237,089 533,783 (3,073,150) 62,697,722

758,687 758,687

3,860,285 3,860,285

44,678,750 44,678,750

49,297,722 13,400,000 62,697,722

Analysis of cost and valuation Cost Valuation At 31 March 2009

10,200,000 10,200,000

Accumulated depreciation At 1 April 2008 Charge for the year Written off

120,000 -

172,890 -

688,512 34,300 -

2,749,952 332,281 (676,398)

38,010,579 1,565,549 (2,365,427)

41,449,043 2,225,020 (3,041,825)

At 31 March 2009

120,000

172,890

722,812

2,405,835

37,210,701

40,632,238

10,080,000

3,027,110

35,875

1,454,450

7,468,049

22,065,484

At 1 April 2007 Additions Deficit on revaluation Disposals Written off

11,530,825 -

4,110,000 -

781,679 3,500

4,247,508 300,045

47,134,477 1,368,290

67,804,489 1,671,835

(396,905) (1,395,227)

(1,340,825) (1,487,040) (1,411,370)

At 31 March 2008

10,200,000

46,710,635

65,237,089

Net book value At 31 March 2009

GROUP 2008 At cost or valuation

48

Annual Report 2009

(430,825) (900,000) -

(910,000) 3,200,000

(26,492) 758,687

(163,643) (16,143) 4,367,767

Computer Forms (Malaysia) Berhad (4423-H)

NOTES TO THE

FINANCIAL STATEMENTS

for the year ended 31 March 2009 (continued)

9.

PROPERTY, PLANT AND EQUIPMENT (continued)

GROUP 2008 At cost or valuation

Long term leasehold buildings RM

Short term leasehold buildings RM

Motor vehicles RM

Furniture, fittings, equipment and renovations RM

Plant and machinery RM

Total RM

Analysis of cost and valuation Cost Valuation

10,200,000

3,200,000

758,687 -

4,367,767 -

46,710,635 -

51,837,089 13,400,000

At 31 March 2008

10,200,000

3,200,000

758,687

4,367,767

46,710,635

65,237,089

892,788 223,197

680,879 34,125

2,557,072 326,840

38,014,172 1,515,665

42,661,831 2,229,173

(124,031) (1,395,227)

(1,695,454) (344,790) (1,401,717)

Accumulated depreciation At 1 April 2007 Charge for the year Adjustment on revaluation Disposals Written off

516,920 129,346 (579,469) (66,797) -

At 31 March 2008

(1,115,985) -

(26,492) -

(127,470) (6,490)

-

-

688,512

2,749,952

38,010,579

41,449,043

10,200,000

3,200,000

70,175

1,617,815

8,700,056

23,788,046

Furniture, fittings, equipment and renovations RM

Motor vehicles RM

Total RM

Net book value At 31 March 2008

COMPANY 2009 At cost or valuation

Long term leasehold buildings RM

Plant and machinery RM

At 1 April 2008 Additions Written off

4,000,000 -

21,143,508 183,000 (863,648)

1,926,000 89,317 (517,524)

431,017 -

27,500,525 272,317 (1,381,172)

At 31 March 2009

4,000,000

20,462,860

1,497,793

431,017

26,391,670

Cost Valuation

4,000,000

20,462,860 -

1,497,793 -

431,017 -

22,391,670 4,000,000

At 31 March 2009

4,000,000

20,462,860

1,497,793

431,017

26,391,670

Analysis of cost and valuation

Computer Forms (Malaysia) Berhad (4423-H)

Annual Report 2009

49

NOTES TO THE FINANCIAL STATEMENTS for the year ended 31 March 2009 (continued) 9.

PROPERTY, PLANT AND EQUIPMENT (continued)

COMPANY 2009 At cost or valuation

Long term leasehold buildings RM

Plant and machinery RM

Furniture, fittings, equipment and renovations RM

Motor vehicles RM

Total RM

Accumulated depreciation At 1 April 2008 Charge for the year Written off

47,059 -

20,102,491 243,440 (848,189)

1,544,795 100,504 (506,773)

431,017 -

22,078,303 391,003 (1,354,962)

At 31 March 2009

47,059

19,497,742

1,138,526

431,017

21,114,344

3,952,941

965,118

359,267

-

5,277,326

Net book value At 31 March 2009 COMPANY 2008 At cost or valuation At 1 April 2007 Additions Deficit on revaluation Disposals Written off

4,140,000 (140,000) -

22,538,735 (1,395,227)

1,872,003 66,947 (7,900) (5,050)

431,017 -

28,981,755 66,947 (140,000) (7,900) (1,400,277)

At 31 March 2008

4,000,000

21,143,508

1,926,000

431,017

27,500,525

Cost Valuation

4,000,000

21,143,508 -

1,926,000 -

431,017 -

23,500,525 4,000,000

At 31 March 2008

4,000,000

21,143,508

1,926,000

431,017

27,500,525

186,068 46,517

20,999,484 498,234

1,459,399 95,025

431,017 -

23,075,968 639,776

(232,585) -

(1,395,227)

-

(232,585) (5,859) (1,398,997)

Analysis of cost and valuation

Accumulated depreciation At 1 April 2007 Charge for the year Adjustment on revaluation Disposals Written off At 31 March 2008

(5,859) (3,770)

-

20,102,491

1,544,795

431,017

22,078,303

4,000,000

1,041,017

381,205

-

5,422,222

Net book value At 31 March 2008

50

Annual Report 2009

Computer Forms (Malaysia) Berhad (4423-H)

NOTES TO THE

FINANCIAL STATEMENTS

for the year ended 31 March 2009 (continued)

9.

PROPERTY, PLANT AND EQUIPMENT (continued) The long term leasehold and short term leasehold buildings of the Group and of the Company were revalued by the directors based on the valuation conducted by independent professional valuers in the year 1980, 1996, 1997, 2003 and 2008 for subsidiary companies and 1996, 1997, 2003 and 2008 for the Company using the open market value basis. GROUP Net book value 2009 2008 RM RM

COMPANY Net book value 2009 2008 RM RM

Certain property, plant and equipment have been pledged with the licensed banks for facilities granted as disclosed in Note 19, 23 and 26 12,150,588

12,400,000

3,952,941

4,000,000

Property, plant and equipment acquired under hire purchase contracts 2,057,119

2,456,833

-

-

Net book value of revalued buildings at valuation had it been stated at cost less accumulated depreciation: Long term leasehold buildings

1,876,936

1,900,931

627,759

636,704

Short term leasehold buildings

837,123

888,273

-

-

2,714,059

2,789,204

627,759

636,704

Computer Forms (Malaysia) Berhad (4423-H)

Annual Report 2009

51

NOTES TO THE FINANCIAL STATEMENTS for the year ended 31 March 2009 (continued)

10.

PREPAID LAND LEASE PAYMENTS Long term leasehold land RM

Short term leasehold land RM

Total RM

19,060,000

1,390,000

20,450,000

At 1 April 2008 Amortisation for the year

1,062,050 212,410

386,572 77,315

1,448,622 289,725

At 31 March 2009

1,274,460

463,887

1,738,347

17,785,540

926,113

18,711,653

GROUP 2009 At cost At 1 April 2008 and 31 March 2009 Accumulated amortisation

Net carrying amount At 31 March 2009

GROUP 2008 At cost At 1 April 2007 Disposals

20,960,000 (1,900,000)

1,390,000 -

22,350,000 (1,900,000)

At 31 March 2008

19,060,000

1,390,000

20,450,000

Accumulated amortisation At 1 April 2007 Amortisation for the year Disposals At 31 March 2008

968,390 234,675 (141,015)

309,257 77,315 -

1,277,647 311,990 (141,015)

1,062,050

386,572

1,448,622

17,997,950

1,003,428

19,001,378

Net carrying amount At 31 March 2008

52

Annual Report 2009

Computer Forms (Malaysia) Berhad (4423-H)

NOTES TO THE

FINANCIAL STATEMENTS

for the year ended 31 March 2009 (continued)

10.

PREPAID LAND LEASE PAYMENTS (continued) 2009 RM

2008 RM

5,060,000

5,060,000

At 1 April Amortisation for the year

284,270 56,854

227,416 56,854

At 31 March

341,124

284,270

4,718,876

4,775,730

COMPANY Long term leasehold land At cost At 1 April and 31 March Accumulated amortisation

Net carrying amount At 31 March

The net carrying amount of prepaid land lease payments of the Group and of the Company pledged with licensed banks for facilities granted as disclosed in note 19, 23 and 26 is RM18,497,305 (2008: RM18,774,421) and RM4,718,876 (2008: RM4,775,730) respectively.

11.

SUBSIDIARY COMPANIES COMPANY

Shares in unquoted corporations at cost Less: Dividends paid out of pre-acquisition profits

Computer Forms (Malaysia) Berhad (4423-H)

2009 RM

2008 RM

99,367,500 (14,927,524)

67,660,008 (14,927,524)

84,439,976

52,732,484

Annual Report 2009

53

NOTES TO THE FINANCIAL STATEMENTS for the year ended 31 March 2009 (continued) 11.

SUBSIDIARY COMPANIES (continued) The subsidiary companies which were incorporated in Malaysia are : Group’s effective equity interest 2009 2008

Name of company

Principal activities

Compu-Aids (M) Sdn. Bhd.

Dormant company.

100%

100%

CFM Resources Sdn. Bhd.

Dormant company.

100%

100%

CFM Ventures Sdn. Bhd.

Dormant company.

100%

100%

CFM Management Services Sdn. Bhd.

Dormant company.

100%

100%

CFM Dagangan Sdn. Bhd.

Dormant company.

100%

100%

*CFM Toppan Forms (M) Sdn. Bhd.

Manufacturing of forms and provision of data or information management, digital printing, enveloping or sealing forms and mailing services.

56%

56%

#CFM Printing & Stationery Sdn. Bhd.

Printing and supplying of exercise books and magazines.

100%

100%

#Contipak Noron Sendirian Berhad

Printing and supplying of packaging commercial printing.

100%

100%

Chip Seng Trading (Holdings) Sdn. Bhd. and its subsidiary Companies:

Investment holding company.

100%

100%

Asset Spectrum Sdn. Bhd.

Dormant company.

100%

100%

Aktif Samudera Sdn. Bhd.

Investment holding company.

100%

100%

CFM Printing & Stationery Sdn. Bhd.

Printing and supplying of exercise books and magazines.

-

100%

Contipak Noron Sendirian Berhad

Printing and supplying of packaging commercial printing.

-

100%

Malaysia Machinery Manufacturers Sdn. Bhd.

Dormant company.

100%

100%

CFM Magnetic Ticket Sdn. Bhd.

Dormant company.

100%

100%

* - Not audited by Messrs Paul Chuah & Co. # - During the financial year, the Company acquired the entire investments in these subsidiaries from another subsidiary company – Chip Seng Trading (Holdings) Sdn. Bhd. This acquisition has no financial effect on the financial statements of the Group.

54

Annual Report 2009

Computer Forms (Malaysia) Berhad (4423-H)

NOTES TO THE

FINANCIAL STATEMENTS

for the year ended 31 March 2009 (continued)

12.

OTHER INVESTMENTS GROUP 2009 RM Shares in corporations at cost: Quoted in Malaysia Less : Allowance for diminution in value

17,122 (12,499)

Market value of quoted investments

13.

2008 RM 17,122 (7,962)

4,623

9,160

4,623

9,160

GOODWILL ON CONSOLIDATION GROUP

At 1 April and 31 March

2009 RM

2008 RM

1,309,392

1,309,392

Impairment testing for goodwill on consolidation For the purpose of impairment testing, goodwill is allocated to the Group’s operating division which represent the lowest level within the Group at which the goodwill is monitored for internal management purposes. The aggregate carrying amount of goodwill is allocated to the manufacturing units in CFM Printing & Stationery Sdn. Bhd. and Contipak Noron Sdn. Bhd. The recoverable amount for the above is determined based on value in use calculated by discounting the future cash flows generated from the continuing use of those units and is based on the following key assumptions: i)

Cash flows projected based on a five years business plan approved by Board of Directors.

ii)

Revenue projected at annual growth of 2% to 5%.

iii)

Expenses projected at annual increase of 1% to 5%.

iv)

A pre-tax discount rate of 6.75% which is the existing rate of borrowing of the Group.

The values assigned to the key assumptions represent management’s assessment of future trends in the industry. A reasonably possible change in a key assumption does not have any significant difference to the recoverable amount.

14.

INVENTORIES GROUP

Raw materials and consumables Work-in-progress Finished goods Raw materials-in-transit

COMPANY

2009 RM

2008 RM

2009 RM

2008 RM

10,046,892 2,650,191 1,446,641 119,517

12,452,049 2,375,334 1,547,692 -

2,917,910 726,167 676,447 -

3,256,241 780,770 612,311 -

14,263,241

16,375,075

4,320,524

4,649,322

Inventories written down are based on the experiences and judgment of the management team on the basis that they reflect expected selling price for such inventories. Obsolete inventories are written off.

Computer Forms (Malaysia) Berhad (4423-H)

Annual Report 2009

55

NOTES TO THE FINANCIAL STATEMENTS for the year ended 31 March 2009 (continued)

15.

TRADE AND OTHER RECEIVABLES GROUP

Trade receivables Allowance for doubtful debts

Other receivables, deposits and prepayment Allowance for doubtful debts

COMPANY

2009 RM

2008 RM

2009 RM

2008 RM

14,148,972

13,918,486

2,915,984

3,806,170

(4,779,762)

(4,798,099)

9,369,210

9,120,387

2,598,392

3,488,578

844,296

770,133

81,128

68,772

(294,555)

(294,555)

-

-

549,741

475,578

81,128

68,772

-

-

169,700

196,297

-

-

1,885,560

12,068,014

9,918,951

9,595,965

4,734,780

15,821,661

Amounts due from subsidiary companies - trade account - current account (Note 22)

(317,592)

(317,592)

The currency exposure profile is as follows:

2009 Ringgit Malaysia US Dollar

2008 Ringgit Malaysia US Dollar

GROUP Trade receivables RM

COMPANY Trade receivables RM

13,045,197 1,103,775

2,915,984 -

14,148,972

2,915,984

13,212,472 706,014

3,806,170 -

13,918,486

3,806,170

Trade credit terms of trade receivables and subsidiary companies range from 30 days to 90 days for current and previous financial years. The Group and the Company have no significant concentration of credit risks. Allowance for doubtful debts is made for receivables that the management consider the recoverability to be doubtful. On a quarterly basis, the management reviews trade receivables’ ageing report, repayment history and any other available evidence of possible default by receivables.

56

Annual Report 2009

Computer Forms (Malaysia) Berhad (4423-H)

NOTES TO THE

FINANCIAL STATEMENTS

for the year ended 31 March 2009 (continued)

16.

MARGIN DEPOSITS WITH A LICENSED BANK The margin deposits represent the amounts placed with a licensed bank for trade facilities granted to the subsidiary companies.

17.

SHARE CAPITAL GROUP AND COMPANY 2009 2008 RM RM Ordinary shares of RM1 each Authorized Issued and fully paid up

18.

100,000,000 100,000,000 41,000,000

41,000,000

HIRE PURCHASE PAYABLES GROUP Minimum lease payments: Hire purchase payables Within one year Two to five years

2009 RM

2008 RM

Less: Future finance charges

586,766 1,022,033 1,608,799 (136,813)

499,464 1,521,499 2,020,963 (235,612)

Present value

1,471,986

1,785,351

512,022 959,964

398,635 1,386,716

1,471,986

1,785,351

3.37%

3.36%

1,462,286

1,635,578

Repayments due: Within one year (Note 23) Two to five years (Note 23)

Effective interest rate Fair value

19.

TERM LOAN GROUP AND COMPANY 2009 2008 RM RM Secured Term loan

19,960,000

21,960,000

10,000,000 9,960,000

3,666,667 18,293,333

19,960,000

21,960,000

Repayments due: Within one year (Note 23) Two to five years (Note 23) The fair value of term loan is RM19,457,378 (2008: RM21,389,690). The term loan is secured by: i) ii)

legal charge over the leasehold properties of the Company and a subsidiary company; and letter of undertaking from the Company.

The repayment of term loan was revised during the financial year ended 31 March 2008 to 8 quarterly payments in the range of RM1,000,000 to RM5,000,000. Interest is charged at 6.75% per annum. Computer Forms (Malaysia) Berhad (4423-H)

Annual Report 2009

57

NOTES TO THE FINANCIAL STATEMENTS for the year ended 31 March 2009 (continued)

20.

DEFERRED TAXATION GROUP

At 1 April Adjustment to opening deferred tax resulting from movement in income tax rate Deferred tax expense arising from and reversal of temporary differences Under/(over) provision of deferred tax liabilities in prior year Transferred from/(to) income statement (Note 7) Revaluation surplus of leasehold building At 31 March

COMPANY

2009 RM

2008 RM

2009 RM

2008 RM

1,825,052

2,415,038

2,280,849

2,390,036

-

10,319

-

(23,587)

225,187

(398,401)

(36,913)

(108,241)

8,932

(225,051)

(5,936)

(505)

234,119

(613,133)

(42,849)

(132,333)

-

23,147

-

23,146

2,059,171

1,825,052

2,238,000

2,280,849

The components of deferred tax liabilities and assets that are recognised during the financial year are as follows: GROUP

COMPANY

2009 RM

2008 RM

2009 RM

2008 RM

822,455

820,005

385,127

405,652

1,852,875 15,563

1,875,197 -

1,852,873 -

1,875,197 -

(307,689) (562,461)

-

-

2,238,000

2,280,849

Deferred tax liabilities: - Capital allowances in excess of depreciation - Revaluation surplus of leasehold building - Others Deferred tax assets: - Unused tax losses - Reinvestment allowances

(75,385) (556,317) 2,059,171

1,825,052

The amount of deferred tax assets that is not recognised in the balance sheet is as follows: GROUP

Unused tax losses

58

Annual Report 2009

2009 RM

2008 RM

55,513

55,345

Computer Forms (Malaysia) Berhad (4423-H)

NOTES TO THE

FINANCIAL STATEMENTS

for the year ended 31 March 2009 (continued)

21.

TRADE AND OTHER PAYABLES GROUP

Trade payables Other payables and accruals Amounts due to subsidiary companies - trading account - current account (Note 22)

COMPANY

2009 RM

2008 RM

2009 RM

2008 RM

2,397,591 1,846,362

1,625,542 1,960,399

161,365 388,384

243,761 436,419

-

-

380,692 22,299,658

217,022 2,005,778

4,243,953

3,585,941

23,230,099

2,902,980

The currency exposure profile are as follows:

2009 Ringgit Malaysia Singapore Dollar US Dollar

2008 Ringgit Malaysia Singapore Dollar US Dollar

GROUP Trade payables RM

COMPANY Trade payables RM

1,989,844 146,808 260,939

57,024 104,341 -

2,397,591

161,365

1,363,850 78,151 183,541

216,784 26,977 -

1,625,542

243,761

Trade credit terms of trade payables and subsidiary companies range from 30 days to 120 days for current and previous financial years.

22.

AMOUNTS DUE FROM/(TO) SUBSIDIARY COMPANIES The amounts due from/(to) subsidiary companies are unsecured, interest free and repayable on demand.

23.

BORROWINGS SHORT TERM BORROWINGS GROUP

Bank overdraft Hire purchase liabilities (Note 18) Term loan (Note 19) Bankers’ acceptances

Computer Forms (Malaysia) Berhad (4423-H)

COMPANY

2009 RM

2008 RM

2009 RM

2008 RM

731,068

676,887

731,068

676,887

512,022 10,000,000 4,170,000

398,635 3,666,667 1,463,000

10,000,000 3,780,000

3,666,667 981,000

15,413,090

6,205,189

14,511,068

5,324,554

Annual Report 2009

59

NOTES TO THE FINANCIAL STATEMENTS for the year ended 31 March 2009 (continued)

23.

BORROWINGS (continued) LONG TERM BORROWINGS GROUP

Hire purchase liabilities (Note 18) Term loan (Note 19)

COMPANY

2009 RM

2008 RM

2009 RM

2008 RM

959,964 9,960,000

1,386,716 18,293,333

9,960,000

18,293,333

10,919,964

19,680,049

9,960,000

18,293,333

The bank overdraft and bankers’ acceptances are secured as follows: i) ii) iii) iv) v) vi)

a negative pledge against the assets of the Company ; a fixed and floating charge over certain subsidiary companies’ assets; a deed of assignment and fixed charge over certain subsidiary companies’ leasehold properties; all monies debenture over certain subsidiary companies’ fixed and floating assets; letter of undertaking from the Company; and corporate guarantee from the Company.

Interests are charged at between 1.0% to 1.5% per annum above banks’ base lending rates.

24.

SIGNIFICANT RELATED PARTY TRANSACTIONS COMPANY 2009 RM Subsidiary companies: Sales of finished goods Purchases of raw materials Dividend income received

(1,055,920) 353,879 (1,435,200)

Corporate shareholder of a subsidiary company: Purchases of raw materials

25.

77,364

2008 RM

(534,489) 223,034 (236,100)

160,401

COMPENSATION OF KEY MANAGEMENT PERSONNEL (a) The remuneration of directors and other key management personnel are as follows: GROUP

COMPANY

2009 RM

2008 RM

2009 RM

2008 RM

Short term employees’ benefits

538,287

534,803

466,287

462,803

Included in total key management personnel are: Directors remuneration (Note 6)

538,287

534,803

466,287

462,803

During the financial year, there were no other key management personnel apart from all the Directors having authority and responsibility for planning, directing and controlling the activities of the Group and of the Company either directly or indirectly. Share options granted to directors are disclosed under directors report. 60

Annual Report 2009

Computer Forms (Malaysia) Berhad (4423-H)

NOTES TO THE

FINANCIAL STATEMENTS

for the year ended 31 March 2009 (continued)

26.

CONTINGENT LIABILITIES GROUP 2008 RM

2009 RM

2008 RM

-

-

390,000

749,250

430,411

417,625

149,161

150,375

430,411

417,625

539,161

899,625

Unsecured Corporate guarantee given to subsidiary companies Secured Bank guarantees given to third parties

COMPANY

2009 RM

The bank guarantees are secured as follows: i) ii) iii) iv) v) vi) vii)

a negative pledge against the assets of the Company; a fixed and floating charge over certain subsidiary companies’ assets; a deed of assignment and fixed charge over certain subsidiary companies’ leasehold properties; all monies debenture over certain subsidiary companies’ fixed and floating assets; letter of undertaking from the Company; corporate guarantee from the Company; and letter of undertaking to unstamp debenture from certain subsidiary companies.

The carrying amount of the bank guarantees at the balance sheet date approximate their fair values due to its relatively short term nature, furthermore, it is not practical to estimate the fair values of the corporate guarantees due to the uncertainties of timing of crystallising.

27.

EMPLOYEES’ SHARE OPTION SCHEME (“ESOS”) The main features of the scheme are as follows: (a)

Eligible employee are any employee (including executive director) of any member of the Computer Forms (Malaysia) Berhad and its subsidiaries (provided that the Company is not dormant), who has been employed and served with a minimum of twelve (12) months continuous service on or prior to the date of offer.

(b)

A director is only eligible to participate in the scheme if the specific allotment made to him/her has been approved by the shareholders of the Company in a general meeting;

(c)

The eligibility for participation in the ESOS shall be determined at the discretion of the option committee and the Board of Directors.

Computer Forms (Malaysia) Berhad (4423-H)

Annual Report 2009

61

NOTES TO THE FINANCIAL STATEMENTS for the year ended 31 March 2009 (continued)

27.

EMPLOYEES’ SHARE OPTION SCHEME (“ESOS”) (continued) (d)

(i)

The maximum number of shares allowable under the scheme shall not exceeds 10% or any such amount or percentage as may be permitted by the relevant authorities, of the issued and paid-up share capital of the Company at any one time;

(ii)

The allocation to eligible executive directors and senior management shall not in aggregate exceed 50% of the new shares available under the scheme; and

(iii)

That not more than 10% of the new shares available under the scheme should be allocated to any eligible employee who, either singly or collectively through persons connected with him holds 20% or more of the issued and paid up capital of the Company.

(e)

The options shall not be less than 100 shares and shall be in multiples of 100 or such other denomination as determined by Bursa Malaysia Securities Berhad.

(f)

The price at which the options are to be exercised subject to the provision of By-Law 14, be determined based on the 5 day weighted average market price of the share immediately preceding the offers date of the option, with a discount of not more than 10% or at the par value of RM1.00 of the share, whichever is higher.

(g)

All remaining unexercised options shall forthwith lapse upon the occurrence of events below: (i) (ii) (iii)

Subject to By-Law 10.2 and 10.3, the Grantee ceasing to be in employment or appointment with the Group, upon liquidation of the Company; or upon bankruptcy of the Grantee

(h)

The person whom the options have been granted have no right to participate by virtue of the options in any share issue of any other company; and

(i)

Unexercised options granted under ESOS carry no dividend, or voting rights. Upon exercise of the option, shares issued rank pari passu in all respects with existing ordinary shares of the Company.

The movement during the year in the number of options over the shares of the Company are as follows: 2009

2008

As at 1 April Lapsed during the year

3,130,000 (99,000)

3,308,000 (178,000)

As at 31 March

3,031,000

3,130,000

Terms of the options outstanding at 31 March 2009: Expiry date

Exercise price

Number

28/10/2009

RM1

3,031,000

The share options arrangement were granted before 1 January 2005 and vested as of 1 January 2006. As allowed by the transitional provision in FRS 2 – share-based payment, the recognition and measurement principles in FRS 2 do not have to be applied to these share options.

62

Annual Report 2009

Computer Forms (Malaysia) Berhad (4423-H)

NOTES TO THE

FINANCIAL STATEMENTS

for the year ended 31 March 2009 (continued)

28.

LEASE COMMITMENT The future minimum lease payments under non cancellable operating leases for rental of premises and office equipment are as follows: GROUP

Within one year Between two to five years

29.

COMPANY

2009 RM

2008 RM

2009 RM

2008 RM

146,130 10,440

139,920 159,060

6,670 870

3,960 13,530

156,570

298,980

7,540

17,490

SEGMENT INFORMATION (a)

Business Segments: The Group is organised into the following segments: (i)

Manufacturing of all kinds of computer forms, stock forms, specialised forms, exercise books, magazines and packaging materials, provision of data or information management, digital printing, enveloping or sealing forms and mailing services.

(ii)

Others - investment holding company and dormant companies. Manufacturing 2009 2008 RM RM

Others 2009 2008 RM RM

Eliminations 2009 2008 RM RM

Consolidated 2009 2008 RM RM

REVENUE External sales Inter-segment sales Total revenue

48,154,69 45,775,726

-

-

-

-

1,955,078

1,259,216

1,435,200

-

(3,390,278) (1,259,216)

50,109,771

47,034,942

1,435,200

-

(3,390,278) (1,259,216)

4,430,443

3,124,343 18,044,045

48,154,693 45,775,726 -

-

48,154,693 45,775,726

RESULT Profit from operations Finance costs Taxation Profit for the year

Computer Forms (Malaysia) Berhad (4423-H)

(40,020) (19,517,200)

25,945

2,957,288

3,110,268

(1,628,607) (1,832,902) (818,013) (31,098) 510,668

Annual Report 2009

1,246,268

63

NOTES TO THE FINANCIAL STATEMENTS for the year ended 31 March 2009 (continued)

29.

SEGMENT INFORMATION (continued) Manufacturing 2009 2008 RM RM

Others 2009 2008 RM RM

Eliminations 2009 2008 RM RM

Consolidated 2009 2008 RM RM

OTHER INFORMATION Segment assets

74,797,095

72,770,632

92,234

132,543

-

-

Unallocated corporate assets Goodwill on consolidation Consolidated total assets Segment liabilities

4,218,244

3,564,486

25,708

21,455

-

-

74,889,329 72,903,175 70,296

349,879

1,309,392

1,309,392

76,269,017

74,562,446

4,243,953

3,585,941

Unallocated corporate liabilities

28,492,275 27,954,384

Consolidated total liabilities

32,736,228 31,540,325

Amortisation of prepaid land lease payments 289,725 Depreciation 2,224,505 Non-cash expensesother than depreciation 342,963 Capital expenditure

(b)

533,783

311,990 2,228,658

515

551

-

-

289,725 2,225,020

311,990 2,229,173

534,089

337

-

-

-

335,602

534,089

1,671,835

-

-

-

-

533,783

1,671,835

Geographical Segments: The Group’s business activities are primarily carried out in Malaysia.

64

Annual Report 2009

Computer Forms (Malaysia) Berhad (4423-H)

ANALYSIS OF SHAREHOLDINGS as at 31 July 2009

A.

SHARE CAPITAL Authorised Share Capital : RM100,000,000.00 (100,000,000 ordinary shares of RM1.00 each) Issued and Paid-up Capital : RM41,000,000.00 (41,000,000 ordinary shares of RM1.00 each) Voting Rights : One vote for each ordinary share held

B.

DISTRIBUTION OF SHAREHOLDINGS Holdings

C.

No. of Holders

Total Holdings

% of Holdings

Less than 100 15 100 - 1,000 143 1,001 - 10,000 1,323 10,001 - 100,000 213 100,001 - less than 5% of issued shares 24 5% and above of issued shares 1

700 121,983 5,336,517 5,560,200 24,092,400 5,888,200

0.00 0.30 13.02 13.56 58.76 14.36

1,719

41,000,000

100.00

SUBSTANTIAL SHAREHOLDERS

Name of Shareholders World Grain Sdn Bhd

D.

No. of Shares

Direct Interest % of Holdings

5,888,200

14.36

Deemed Interest No. of % of Shares Holdings -

-

DIRECTOR’S INTEREST IN SHARES None of the Directors who held office at the end of the financial year had any interest in the shares of the Company.

Computer Forms (Malaysia) Berhad (4423-H)

Annual Report 2009

65

ANALYSIS OF SHAREHOLDINGS as at 31 July 2009 (continued)

E.

THIRTY LARGEST REGISTERED SHAREHOLDERS Name of Shareholders 1. 2. 3. 4. 5. 6. 7. 8.

World Grain Sdn Bhd Ong Huey Peng Lee Pui Inn Ong Wee Lieh Ong Har Hong Chew Boon Seng Lim Siew Sooi Mayban Securities Nominees (Tempatan) Sdn Bhd (A/C for Lim Eng Huat) 9. Ong Poh Lin 10. Low Cheng Peng 11. Gan Lock Yong @ Gan Choon Hur 12. Ong Poh Geok 13. Ong Wee Shyong 14. Kong See Kuan 15. Tan Tuan Shee 16. Tan Siew Yeong 17. Tan Eng @ Tan Chin Eng 18. Tan Seng Teong Sdn Bhd 19. Ding Meng Sieng 20. Gan Ah Kuan 21. Haliza Binti Abdullah 22. Chee Keng Properties Sdn Bhd 23. Mayban Securities Nominees (Asing) Sdn Bhd (Amfraser Securities Pte Ltd for Tan Kay Toh) 24. CIMSEC Nominees (Tempatan) Sdn Bhd (CIMB Bank for Tan Hwa Imm) 25. Sim Leong Thun 26. Tee Yeow 27. Lew Chung Han 28. Teh Liang Teik 29. Ewe Thuan Ho 30. Ho Kin Chai

66

Annual Report 2009

No. of Shares

% of Holdings

5,888,200 2,000,000 2,000,000 2,000,000 2,000,000 2,000,000 1,952,100 1,947,400

14.36 4.88 4.88 4.88 4.88 4.88 4.76 4.75

1,945,000 1,936,400 1,936,000 1,174,000 1,063,400 375,000 305,000 227,500 167,500 155,600 155,000 150,000 137,500 125,000 125,000

4.74 4.72 4.72 2.86 2.59 0.91 0.74 0.55 0.41 0.38 0.38 0.37 0.34 0.30 0.30

110,000

0.27

105,000 100,000 100,000 92,500 87,500 85,000

0.26 0.24 0.24 0.23 0.21 0.21

Computer Forms (Malaysia) Berhad (4423-H)

LIST OF GROUP’S PROPERTIES as at 31 March 2009

Land Area (Sq. metres)

Description/ Existing use

Tenure/ Approximate Age of building

Net Book Value as at 31.3.2009* (RM)

Date of Building Revaluation

Location of Property 1. Lot 2, Jalan Usahawan 5, PKNS Setapak Industrial Area, Kuala Lumpur

8,094

Industrial Land and Factory Building

Leasehold / 31 years (expiring on 10.11.2093)

8,671,818

31.03.2008

2. Lot 1, Jalan 6, PKNS Setapak Industrial Area, Kuala Lumpur

21,925

Industrial Land and Factory Building

Leasehold / 13 years (expiring on 09.11.2093)

19,193,723

31.03.2008

3. Lot 13 & 14, Jalan Perusahaan Ringan, Off Jalan Genting Kelang, Setapak, Kuala Lumpur

3,412

Industrial Land and Factory Building

Leasehold / 45 years [expiring on 03.11.2020 (Lot 13) & 04.03.2026 (Lot 14)]

2,782,353

31.03.2008

822

Industrial Land and Factory Building

Leasehold / 38 years (expiring on 07.02.2035)

1,170,869

31.03.2008

4. P. T. 23 HS(D) 78420, Mukim of Setapak, Kuala Lumpur

* Inclusive of prepaid land lease payments

Computer Forms (Malaysia) Berhad (4423-H)

Annual Report 2009

67

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Annual Report 2009

Computer Forms (Malaysia) Berhad (4423-H)

PROXY FORM COMPUTER FORMS (MALAYSIA) BERHAD (4423-H) (Incorporated in Malaysia)

I/We

NRIC No./Company No. (full name in block letters)

of (full address) being a member of COMPUTER FORMS (MALAYSIA) BERHAD hereby appoint NRIC No. (full name in block letters) of (full address) representing

percentage (%) of my/our shareholdings in the Company and/or failing him/her NRIC No. (full name in block letters)

of (full address) representing percentage (%) of my/our shareholdings in the Company and/or failing him/her/them, the Chairman of the Meeting as my/our proxy/proxies to attend and vote for me/us and on my/our behalf at the Forty-Seventh Annual General Meeting of the Shareholders of the Company to be held at Bukit Kiara Equestrian and Country Resort, Dewan Berjaya, Jalan Bukit Kiara, Off Jalan Damansara, 60000 Kuala Lumpur, Malaysia on Tuesday, 29 September, 2009 at 11.00 a.m. and at any adjournment thereof in the manner indicated below: Ordinary Business

For

Against

Ordinary Resolution No. 1 Ordinary Resolution No. 2 Ordinary Resolution No. 3 Ordinary Resolution No. 4 Ordinary Resolution No. 5 (Please indicate with an “X” in the space provided how you wish your vote to be cast for each resolution as set out in the Notice of Meeting. If no voting instructions are given, the proxy/proxies may vote or abstain from voting at his/her/their own discretion)

No. of Shares held Signature(s)/Common Seal Dated this _______ day of September, 2009 Notes: 1. A member entitled to attend and vote at the meeting is entitled to appoint one or more proxies (but not more than two) to attend and vote instead of him. A proxy may but need not be a member of the Company and the provisions of Section 149(1)(b) of the Act shall not apply to the Company. Where a member appoints two proxies to attend the same meeting, the member shall specify the proportion of his shareholding to be represented by each proxy, failing which the appointment(s) shall be invalid. 2. The instrument appointing a proxy shall be in writing under the hand of the appointer or of his attorney duly authorised in writing or, if the appointor is a corporation, either under the corporation’s common seal or under the hand of an officer or attorney duly authorised. The instrument appointing a proxy shall be deemed to confer authority to demand or join in demanding a poll. 3. The instrument appointing a proxy shall be deposited with the Share Registrar of the Company, Symphony Share Registrars Sdn Bhd at Level 26, Menara Multi Purpose, Capital Square, No. 8, Jalan Munshi Abdullah, 50100 Kuala Lumpur, Malaysia not less than 48 hours before the time appointed for holding the meeting or any adjournment thereof.

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STAMP

COMPUTER FORMS (MALAYSIA) BERHAD (4423-H) c/o Symphony Share Registrars Sdn Bhd Level 26, Menara Multi Purpose, Capital Square No. 8, Jalan Munshi Abdullah 50100 Kuala Lumpur

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