He is an associate of the Institute of Chartered Accountants in England and Wales (ICAEW) and a fellow of the Chartered Institute of Management Accountants, United Kingdom (CIMA) as well as a member of the Malaysian Institute of Accountants (MIA). YM Tengku Badli is a member of the Audit Committee, Remuneration Committee and Nomination Committee of FINTEC.
MANAGEMENT DISCUSSION AND ANALYSIS
This resulted in the Group recording an increase in Other Operating Income from RM0.7 million to RM242.7 million in 2020. The Group's operating expenses decreased by about half to RM17.3 million in 2020 compared to RM42.1 million in 2019.
CORPORATE SUSTAINABILITY STATEMENT
In our daily activities, the Group remains committed to recycling, energy saving practices and taking action to reduce waste, pollution and harmful emissions. In this context, motivation and recreation are also an essential part of the Group's responsibility towards our employees.
CORPORATE GOVERNANCE OVERVIEW STATEMENT
- Board’s Leadership on Objectives and Goals 1 Strategic Aims, Values and Standards
- Chairman
- Board’s Leadership on Objectives and Goals cont’d
- Separation of the Positions of the Chairman and Executive Directors
- Qualified and Competent Secretaries
- Access to Information and Advice
- Demarcation of Responsibilities 1 Board Charter
- Promoting Good Business Conduct and Corporate Structure 1 Code of Conduct and Ethics
- Whistle Blowing Policy
- Anti-Bribery and Anti-Corruption Policy (“ABAC Policy”)
- Strengthen Board’s Objectivity 1 Board Composition
- Tenure of Independent Director
- Policy of Independent Director’s Tenure
- Diverse Board and Senior Management Team
- Gender Diversity
- Strengthen Board’s Objectivity cont’d
- Identification of New Candidates for Appointment of Directors
- Overall Board Effectiveness 1 Annual Evaluation
- Overall Board Effectiveness cont’d 1 Annual Evaluation cont’d
- Level and Composition of Remuneration 1 Remuneration Policy
- Remuneration of Directors and Senior Management 1 Detailed Disclosure of Directors’ Remuneration
- Remuneration of Directors and Senior Management cont’d 1 Detailed Disclosure of Directors’ Remuneration cont’d
- Remuneration of Top Five (5) Senior Management
To ensure a balance of power and authority on the board, half of the board members are independent directors. The remuneration policy is laid down in the company's board regulation, and it is also available on the company's website.
Risk Management and Internal Control Framework 9. Risk Management and Internal Control Framework
Governance, Risk Management and Internal Control Framework
During the reporting year, the internal auditors carried out an assessment of the Group in accordance with the Internal Audit Plans, which have been approved by the AC. The internal auditors will conduct periodic tests of the internal control systems to ensure that the system is robust.
Continuous Communication Between Company and Stakeholders
The Board has outsourced the internal audit (“IA”) function to an independent assurance provider, namely Wensen Consulting Asia (M) Sdn. The Statement on Risk Management and Internal Control as included on pages 36 and 37 of this Annual Report provides an overview of the internal control framework adopted by the Company during the financial year ended March 31, 2020.
Shareholder Participation at General Meetings
OTHER COMPLIANCE INFORMATION
- AUDIT AND NON-AUDIT FEES
- MATERIAL CONTRACTS
- RECURRENT RELATED PARTY TRANSACTIONS
- UTILISATION OF PROCEEDS
- UTILISATION OF PROCEEDS cont’d
- SHARE ISSUANCE SCHEME (“SIS”)
- SHARE ISSUANCE SCHEME (“SIS”) cont’d
- PROPERTIES
For the financial year ended 31 March 2020, there is one (1) SIS with the following information:-. For the financial year ended 31 March 2020, there is one (1) SIS with the following information:- continuation of Options granted to directors and CEO.
AUDIT COMMITTEE REPORT
- COMPOSITION AND MEETINGS
- TERMS OF REFERENCE OF AUDIT COMMITTEE
- TERMS OF REFERENCE OF AUDIT COMMITTEE cont’d
- SUMMARY OF ACTIVITIES OF THE AUDIT COMMITTEE
- INTERNAL AUDIT FUNCTION
The internal auditors provide the audit committee with an independent assessment of the adequacy and effectiveness of the Group's risk management and internal control system. The role of internal audit is independent and not related to the Group's external auditors.
STATEMENT ON
RISK MANAGEMENT AND INTERNAL CONTROL
STATEMENT ON RISK MANAGEMENT AND INTERNAL CONTROL
FINANCIAL STATEMENTS
Directors’ Report
By virtue of Leung Kok Keong and Tan Sik Eek's interest in the shares of the Company. Upon completion of the Share Consolidation, the total outstanding Warrants A in the Company were consolidated into Warrants A. No options were granted by the Company to any parties during the financial year to take up unissued shares of the Company.
The remuneration of the auditors of the Group and the Company for the financial year ended 31 March 2020 was RM93,000 and RM28,000 respectively.
Statement by Directors
In the opinion of the directors, the accompanying financial statements set out on pages 50 to 106 have been prepared in accordance with Malaysian Financial Reporting Standards, International Financial Reporting Standards and the requirements of the Malaysian Companies Act 2016 so as to give a true and fair view of true and fair view of the financial position of the Group and the Company as at 31 March 2020 and of their financial performance and cash flows for the financial year then ended.
Statutory Declaration
In our opinion, the accompanying financial statements give a true and fair view of the financial position of the Group and of the Company as at 31 March 2020, and of their financial performance and their cash flows for the financial year then ended in accordance with Malaysia Financial Reporting Standards, International Financial Reporting Standards and the requirements of the Companies Act 2016 in Malaysia. Our responsibilities under those standards are further described in the Auditors' Responsibilities for the Audit of the Financial Statements section of our report. We are independent of the Group and of the Company in accordance with the Bylaws (on Professional Ethics, Conduct and Practice) of the Malaysian Institute of Accountants (“Bylaws”) and the International Ethical Standards Board for Accountants.
Key audit matters are those matters that, in our professional judgment, were of greatest importance in our audit of the Group's and the Company's financial statements for the current year.
Independent Auditors’ Report
REPORT ON THE AUDIT OF THE FINANCIAL STATEMENTS, continued Key audit matters, continued. ii) Impairment of amounts owed by subsidiaries. Our opinion on the financial statements of the Group and the Company does not relate to the other information and we do not formulate any certainty conclusions about this. REPORT ON THE AUDIT OF THE FINANCIAL STATEMENTS, continued Responsibilities of accountants for the audit of the financial statements.
From the matters with which the directors become familiar, we determine those matters which were the most important when auditing the financial statements of the group and the company for the current year and are therefore key audit matters.
Statements of Profit or Loss and Other Comprehensive Income
Statements of Financial Position
Statements of Changes in Equity
Statements of Cash Flows
March
- BASIS OF PREPARATION
The financial statements of the Group and the Company have been prepared in accordance with Malaysian Financial Reporting Standards (“MFRSe”), International Financial Reporting Standards and the requirements of the Companies Act 2016 in Malaysia. The accompanying financial statements have been prepared on the assumption that the Group and the Company will continue as going concerns considering the realization of assets and the settlement of liabilities in the normal course of business. These financial statements are presented in the Ringgit Malaysia (“RM”), which is the Group's and the Company's functional and presentation currency.
Notes to Financial Statements
BASIS OF PREPARATION cont’d
Valid for the annual period beginning on or after. z Changes to references to the conceptual framework in MFRS standards. Amendments to MFRS 134 Interim Financial Reporting January 1, 2020 - Amendments to MFRS 137 Provisions, Contingent Liabilities and Contingent Liabilities. Amendments to MFRS 9 Financial Instruments January 1, 2022. z Amendments to MFRS 3 Business Combinations: reference to the conceptual.
Equipment – Proceeds before intended use January 1, 2022. z Amendments to MFRS 137 Provisions, contingent liabilities and contingent assets:.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (a) Basis of consolidation
A change in conditions that may cause estimates to change include changes in market trends and conditions, regulatory framework, employee behavior and other factors that may change the amount of provisions in the statement of financial position. The difference between the actual amount and the estimated amount will be recognized in the result in the period in which the change occurs. This requires management to estimate the expected future cash flows of the cash-generating units to which goodwill is allocated and to apply an appropriate discount rate to determine the present value of those cash flows.
The future cash flows are most sensitive to budgeted gross margins, estimated growth rates and applied discount rate.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES cont’d (a) Basis of consolidation cont’d
Upon the acquisition of a minority interest, the difference between the consideration and the Group's share of the net assets acquired is recognized directly in equity. Upon loss of control over a subsidiary, the Group removes the assets and liabilities of the subsidiary, any minority interests and the other components of equity related to the subsidiary. Unrealized gains arising from transactions with associates accounted for using the equity method are eliminated against the investment to the extent of the Group's interest in the associates and jointly controlled entities.
Under the equity method, the investment in associates is valued in the balance sheet at cost plus changes in the Group's share in the net assets of the associates after acquisition.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES cont’d (b) Foreign currencies
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES cont’d (c) Revenue and other income cont’d
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES cont’d (f) Tax expense cont’d
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES cont’d (g) Impairment cont’d
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES cont’d (h) Property, plant and equipment
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES cont’d (i) Leases cont’d
Lease payments are divided between the financing costs and the reduction in the outstanding obligation. Payments from operating leases are recognized as an expense on a straight-line basis over the term of the relevant lease agreement. If the recoverable amount of the cash-generating units is lower than the carrying amount, an impairment loss is recognized in the profit and loss account.
Goodwill disposed of in this case is measured on the basis of the relative fair values of the activities disposed of and the part of the cash-generating unit that is retained.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES cont’d (k) Financial assets cont’d
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES cont’d (m) Financial liabilities cont’d
REVENUE AND OTHER INCOME cont’d (c) Disaggregation of revenue
EMPLOYEE BENEFITS EXPENSES
FINANCE COST
TAX INCOME
EARNINGS PER SHARE
PROPERTY, PLANT AND EQUIPMENT Freehold landFactory Buildings Computers
PROPERTY, PLANT AND EQUIPMENT cont’d Freehold landFactory Buildings Computers
RIGHT-OF-USE ASSETS
INTANGIBLE ASSETS
INVESTMENT IN SUBSIDIARIES
INVESTMENT IN SUBSIDIARIES cont’d
MARKETABLE SECURITIES
INVENTORIES
TRADE RECEIVABLES
NON-TRADE RECEIVABLES, DEPOSITS AND PREPAYMENTS
AMOUNT DUE FROM/(TO) SUBSIDIARIES
AMOUNT DUE FROM/(TO) SUBSIDIARIES cont’d
INVESTMENT IN UNQUOTED SHARES
DEPOSITS WITH LICENSED FINANCIAL INSTITUTIONS
SHARE CAPITAL
IRREDEEMABLE CONVERTIBLE PREFERENCE SHARE (“ICPS”)
IRREDEEMABLE CONVERTIBLE PREFERENCE SHARE (“ICPS”) cont’d
RESERVE
Companies Act 2016 (“Act”) which came into force from 31 January 2017 abolished the concept of authorized share capital and par value of share capital. The share premium amount can be used for purposes as set out in Section 618(3) of the Act within 24 months after the entry into force of the Act. Share premium of RM554,709 was transferred to the share capital account and formed part of the share capital of the Company upon expiry of the 24 month transition period on 31 January 2019.
The Warrant Reserve relates to the fair value of free warrants issued under the Right Issue.
LEASE LIABILITIES
Pursuant to the above, the Company used RM743,545 from the share premium account for share issue expenses in the previous financial year.
TRADE PAYABLES
NON-TRADE PAYABLES AND ACCRUALS
BORROWING
SIGNIFICANT RELATED PARTY TRANSACTIONS (a) Identities of related parties
SIGNIFICANT RELATED PARTY TRANSACTIONS cont’d (c) Compensation of Key Management Personnel
OPERATING SEGMENTS (a) Business segments
OPERATING SEGMENTS cont’d (a) Business segments cont’d
FINANCIAL INSTRUMENTS
FINANCIAL INSTRUMENTS cont’d
The Group and the Company are exposed to financial risks arising from their operations and the use of financial instruments. The Group's and the Company's financial risk management policy seeks to ensure that sufficient financial resources are available for the development of the Group's and the Company's businesses while managing its credit risk, market risk, interest rate risk and liquidity risk. The following sections provide details regarding the Group's and the Company's exposure to the above financial risks and the objectives, policies and processes for managing these risks.
The Group's and the Company's exposure to credit risk mainly stems from the individual characteristics of each customer.
FINANCIAL INSTRUMENTS cont’d Credit risk cont’d
The largest exposure to credit risk at the end of the reporting period is represented by their book values in the statement of financial position. End of the reporting period The Group and the company have not made value adjustments. Market risk is the risk that changes in market prices, such as exchange rates and interest rates, will affect a company's financial position or cash flows.
The Group's and the Company's primary interest rate risk relates to interest earned from deposits with licensed banks of financial institutions.
FINANCIAL INSTRUMENTS cont’d Interest rate risk cont’d
FINANCIAL INSTRUMENTS cont’d Maturity analysis cont’d
SIGNIFICANT EVENTS DURING THE FINANCIAL YEAR
SIGNIFICANT EVENTS DURING THE FINANCIAL YEAR cont’d
PRIOR YEARS ADJUSTMENT
GENERAL INFORMATION
Analysis of Shareholdings
Analysis of Preference Shareholdings
Analysis of Warrantholdings (Warrant A)
Analysis of Warrantholdings (Warrant B)
Notice of Annual General Meeting
A proxy may, but need not, be a Member of the Company and there shall be no restriction in respect of the qualification of the proxy. The payment of the Directors' fees for the financial year ending on 31 March 2021 will only be made if the proposed Resolution 3 has been adopted at the Thirteenth AGM in accordance with Regulation 105 of the Company's Constitution and Section 230(1) of the Act. The directors' remuneration (excluding directors' fees) consists of the allowances and other remuneration payable to the board of the company and its subsidiaries as follows:-.
The Previous Mandate was used for the private placement of 10% of the issued shares of the Company ("Private Placement").
AFFIX STAMP
FINTEC GLOBAL BERHAD
