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2. The reported transacted amount has exceeded the estimated aggregate value by 110%.
This is due to the change of timing in recognising the marketing and advertising services
fee received/receivable from HAPPL Group. In the past, the Group recorded this transaction
only upon receipt of the amount due i.e. on a receipt basis. In accordance with the normal
accounting treatment, this transaction item is now recognised based on actual amount
receivable in the period it is due. The marketing and advertising services fee received /
receivable are in respect of services provided to GAB Group up to 30 September 2013.
Pursuant to the Listing Requirements, transactions entered into with the same party or parties
connected with one another may be aggregated for the purpose of determining whether a
public disclosure is required in the event that the actual value of a related party transaction
exceeds the estimated value disclosed in the mandate by 10% or more. Given that the total
actual value transacted with the HAPPL Group is reported to be within the total estimated
value stipulated in the existing Shareholders’ Mandate, no separate announcement to Bursa
Securities is required.
Save for the item disclosed under Note 2, none of the actual value of other recurrent related
transactions as disclosed above has exceeded the estimated value by 10% or more.
As of the financial year ended 30 June 2013, there is no amount due and owing to the Company by
its related parties arising from the Recurrent Related Party Transactions that exceeded the credit
term.
2.4 Guidelines and Review Procedures for Recurrent Related Party Transactions
To ensure that such Recurrent Related Party Transactions are conducted at arm’s length and on
normal commercial terms consistent with the Group’s usual business practices and policies and
will not be prejudicial to the Company’s shareholders, the following principles will apply:
i)
transactions with the Related Parties will only be entered into after taking into account the
pricing, level of service, quality of product, market forces and other related factors on terms
not more favourable to the Related Parties than those generally available to the public and
not detrimental to the minority shareholders of the Company;
ii)
transactions with Related Parties will only be entered into under similar commercial terms
for transactions with unrelated third parties, which depend on the demand and supply of the
products and subject to the availability of the products in the domestic market;
iii) should a cost plus basis of pricing be used, the appropriatemark-up to cost shall be determined
on an arm’s length price based on a percentage earned by the Company on unrelated party
transactions which are the same or very similar to the related party transactions;
iv) at least two (2) other contemporaneous transactions with unrelated third parties for similar
products / services and / or quantities will be used as comparison, wherever possible, to
determine whether the price and terms offered to / by the Related Parties are fair and
reasonable and comparable to those offered to / by other unrelated third parties for the same
or substantially similar type of products / services and /or quantities. For certain products /
services of which quotation or comparative pricing from unrelated third parties cannot be
obtained (for instance, if there are no unrelated third party vendors / customers of similar
products or services, or if the product / service is a proprietary item), the transaction price
will be determined by the Group based on those offered by / to other related parties for the
same or substantially similar type of transaction to ensure that the price and terms of the
Recurrent Related Party Transaction are fair and reasonable to the Group; and
v)
there is no specific threshold for approval of Recurrent Related Party Transactions within the
Group. However, all recurrent related party transactions are subject to the approval by the
Audit Committee from time to time.
The Group has established the following procedures to ensure that the transactions with Related
Parties are undertaken on arm’s length basis and on normal commercial terms, and on transaction
prices and terms not more favourable to the Related Parties than those generally available to the
public: