REPORT OF THE AUDITORS
We report to the shareholders of The Union Mosaic Industry Public Company Limited that
have examined the balance sheet as at December 31, 1997 and 1996, and the related
statements of profit and loss and retained earnings, cash flows and changes in shareholders+
equity for each year then ended respectively of The Union Mosaic Industry Public Company
Limited. Our examination was made in accordance with generally accepted auditing
standards, and accordingly included such tests of the accounting records and such other
auditing procedures as we considered necessary in the circumstances.
Equity in undistributed net profit (loss) of an associated company, computed from the
financial statements which have not been audited (by other auditors), amounted to (16.76)%
(12.61)% of net loss for the years ended December 31, 1997 and 1996 respectively (see
note 6).
We have issued the report on a review of the financial statements for the quarter and nine-
month period ended September 30, 1997, which was dated November 10, 1997, with the
exception of the effects on such interim financial statements which arose from recording a
loss on translation of assets and liabilities in foreign currencies upon the introduction of the
managed float exchange system as a deferred loss and presented as a deduction from
shareholders+ equity, which is not in accordance with generally accepted accounting
principles as mentioned in Note 2.10.2 to the financial statements. However, in the
presentation of financial statements for the year ended December 31, 1997, referred to in the
first paragraph, the Company has changed the method of accounting for such loss from being
deferred to being recognized as expense in the profit and loss statement in order to be in
accordance with generally accepted accounting principles. The adjustments have been made
the related transactions in the quarter and nine-month period ended September 30, 1997
under this change of method as mentioned in Note 2.10.3 to the financial statements.
In our opinion, subject to the effect of any adjustments to the financial statements for 1997
1996 if the financial statements of the associated company have been audited, as referred
in the second paragraph, the financial statements referred to in the first paragraph present
fairly the financial position as at December 31, 1997 and 1996, and the results of operations
the cash flows and changes in shareholders+ equity for each year then ended respectively
The Union Mosaic Industry Public Company Limited, in conformity with generally
accepted accounting principles applied on a consistent basis.
-
Without qualifying our opinion, we draw attention to Note 1 to the financial statements. The
country+s unstable economy has to a certain extent affected, and may continue to affect the
operations, the recoverability of the Company+s assets and the ability of the Company to
maintain or pay its debts as they mature.
Toemsakdi Krishnamra
BANGKOK Certified Public Accountant
February 20, 1998 DELOITTE TOUCHE TOHMATSU JAIYOS
THE UNION MOSAIC INDUSTRY PUBLIC COMPANY LIMITED
BALANCE SHEET
AT DECEMBER 31,
1997 1996
ASSETS
CURRENT ASSETS
Cash in hand and at banks 890,896 172,515
Short term investments (Notes 2.2 and 3) 54,120,623 21,829,902
Accounts receivable 378,411,069 343,532,882
Less Allowance for doubtful accounts (Note 2.3) (5,669,180) -
Net accounts receivable 372,741,889 343,532,882
Short - term loans 15,135 31,215
Inventories (Notes 2.4 and 4) 520,628,341 427,695,193
Other accounts receivable 25,833,370 29,615,117
Deposits used as collateral (Note 5) 25,000,000 -
Other current assets 11,971,708 7,751,200
Total Current Assets 1,011,201,962 830,628,024
INVESTMENTS IN RELATED PARTIES (Notes 2.5 and 6) 96,080,696 137,974,544
PROPERTY, PLANT AND EQUIPMENT - NET (Notes 2.6 and 7) 1,715,183,352 1,785,686,356
DEPOSIT 45,782,250 45,782,250
OTHER ASSETS (Notes 2.7, 2.8 and 8) 9,490,120 17,314,747
TOTAL ASSETS BAHT 2,877,738,380 2,817,385,921
Notes to the financial statements form an integral part of these statements
THE UNION MOSAIC INDUSTRY PUBLIC COMPANY LIMITED
BALANCE SHEET
AT DECEMBER 31,
1997 1996
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES
Bank overdrafts and loans from financial institutions
(Note 9) 446,045,804 388,089,217
Accounts payable 244,872,739 250,278,016
Current portion of long-term debt (Note 10) 351,380,800 87,244,000
Accrued expenses 63,330,595 63,954,972
Other current liabilities 18,309,488 1,687,298
Total Current Liabilities 1,123,939,426 791,253,503
LONG-TERM DEBT (Note 10) 879,739,200 625,956,000
TOTAL LIABILITIES 2,003,678,626 1,417,209,503
SHAREHOLDERS' EQUITY
SHARE CAPITAL
Registered capital
50,000,000 ordinary shares of
Baht 10.00 each 500,000,000 500,000,000
Issued and paid-up capital
32,000,000 ordinary shares of
Baht 10.00 each, fully paid 320,000,000 320,000,000
PREMIUM ON SHARE CAPITAL 498,800,000 498,800,000
UNREALIZED INCREMENT PER LAND APPRAISAL 266,102,532 266,102,532
(Notes 2.6 and 7)
RETAINED EARNINGS (DEFICIT)
Appropriated
Legal reserve (Note 11) 32,000,000 32,000,000
Unappropriated (Deficit) (242,842,778) 283,273,886
TOTAL SHAREHOLDERS' EQUITY 874,059,754 1,400,176,418
TOTAL LIABILITIES AND SHAREHOLDERS'
EQUITY BAHT 2,877,738,380 2,817,385,921
Notes to the financial statements form an integral part of these statements
THE UNION MOSAIC INDUSTRY PUBLIC COMPANY LIMITED
STATEMENT OF PROFIT
THE YEAR ENDED DECEMBER 31,
1997 1996
REVENUES
Sales 1,651,677,643 1,678,902,070
Other income 99,806,002 81,744,986
Total Revenues 1,751,483,645 1,760,647,056
EXPENSES
Cost of sales 1,371,585,174 1,543,785,311
Equity in undistributed net loss of associated
companies 25,641,640 33,507,137
Selling and administrative expenses 234,621,976 263,976,048
Loss from exchange 1,181,320 -
Interest expenses 109,347,405 94,614,809
Other expenses 4,910,390 10,710,182
Total Expenses 1,747,287,905 1,946,593,487
NET PROFIT (LOSS) BEFORE EXTRAORDINARY ITEMS 4,195,740 (185,946,431)
EXTRAORDINARY ITEM
Loss from the application of the managed float
exchange system (Notes 2.10 and 12) (530,312,404) -
NET LOSS BAHT (526,116,664) (185,946,431)
NET PRORIT (LOSS ) PER SHARE (Note 2.12)
Profit (Loss) before extraordinary items BAHT 0.13 (5.81)
Extraordinary item BAHT (16.57) -
Net loss BAHT (16.44) (5.81)
Notes to the financial statements form an integral part of these statements
THE UNION MOSAIC INDUSTRY PUBLIC COMPANY LIMITED
STATEMENT OF CHANGES IN SHAREHOLDERS EQUITY
AT DECEMBER 31,
1997 1996
SHARE CAPITAL
Beginning Balance 320,000,000 320,000,000
Ending Balance 320,000,000 320,000,000
PREMIUM ON SHARE CAPITAL
Beginning Balance 498,800,000 498,800,000
Ending Balance 498,800,000 498,800,000
UNREALIZED INCREMENT PER LAND APPRAISAL
Beginning Balance 266,102,532 266,102,532
Ending Balance 266,102,532 266,102,532
RETAINED EARNINGS
Appropriated
Legal reserve
Beginning Balance 32,000,000 32,000,000
Ending Balance 32,000,000 32,000,000
Unappropriated
Beginning Balance 283,273,886 493,220,317
Decrease in the period (526,116,664) (209,946,431)
Ending Balance (deficit) (242,842,778) 283,273,886
TOTAL SHAREHOLDERS+ EQUITY BAHT 874,059,754 1,400,176,418
Notes to the financial statements form an integral part of these statements
THE UNION MOSAIC INDUSTRY PUBLIC COMPANY LIMITED
STATEMENT OF RETAINED EARNINGS
THE YEAR ENDED DECEMBER 31,
1997 1996
UNAPPROPRIATED RETAINED EARNINGS
Beginning Balance 283,273,886 493,220,317
Less Appropriation of net income for the prior
period:
Dividends - (24,000,000)
loss for the period (526,116,664) (185,946,431)
Total unappropriated retained earning (deficit) (242,842,778) 283,273,886
APPROPRIATED RETAINED EARNINGS - -
TOTAL RETAINED EARNINGS (DEFICIT) BAHT (242,842,778) 283,273,886
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