The Effect of Changes in Accounting for Investments

May 11, 2007

Subject : The Effect of Changes in Accounting for Investments

To : Director and Manager of the Stock Exchange of Thailand

Reference is made to Board Resolution 3/2007 dated May 10, 2007, approving the financial statement for the first quarter ended March 31, 2007.

The company would like to report on the effect of the changed its accounting policy regarding investment, which formerly reported investment using the equity method, now using the cost method in the separate financial statement. This adjustment caused net profit for the first quarter year 2007 and 2006 on the consolidated financial statement amounting 202.17 million baht and 50.60 million baht respectively differ from the first quarter year 2007 and 2006 on the separate financial statement amounting 210.74 million baht and 160.11 as following

1. The different of the figure in the first quarter ended March 31, 2007 on the consolidated financial statement and separated financial statement amounting 202.17 million and 210.74 million baht mainly due to sharing profit on separated financial statement from land selling to Pornsanti Co., Ltd.amounting 15.42 million baht and sharing loss from investment in Pornsanti Co., Ltd. amounting 0.26 million baht , sharing profit from investment in Lumpini Property Management Co., Ltd. amounting 7.61 million and sharing profit from Grand Unity Development Co., Ltd. amounting 0.55 million baht

2. The different of the figure in the first quarter ended March 31, 2006 on the consolidated financial statement and separated financial statement amounting 50.60 million Baht and 160.11 million baht mainly due to the separated financial statement was included dividend receiving from Lumpini Property Management Co., Ltd. 69.92 million baht, dividend receiving from Grand Unity Development amounting 73 million baht and sharing loss from investment in Pornsanti Co., Ltd. amounting 1.03 million baht and deducted with sharing profit in Lumpini Property Management Co., Ltd. amounting 18.09 million baht and sharing profit from investment in Grand Unity Development amounting 16.35 million baht.

The effect to other itmes on the separate financial statement (Balance Sheet) such as Impairment of investing capital from Pornsanti Co., Ltd. amounting 111.43. million baht as shown in Notes to financial statement:

a) 2.6 Topic 2 Basic of preparation of the financial statement

b) Topic 4 Changing of Accounting from Investment in subsidiary and affiliated companies.

c) Topic 9.6 Investment in subsidiary and affiliated companies on Topic 9. Transaction with related companies.

However the change of accounting policy affected only on the separated financial statement. It did not has any effect on the consolidated financial statement on business fundamental.

 

Best Regard

Opas Sripayak
Managing Director