杰地集团(08313) - 2019 - 年度财报

Chairman's Statement Performance Overview and Business Review In FY2019, the Group's financial position significantly improved, achieving a net profit of approximately SGD 4.6 million, a year-over-year increase of over 300%, primarily driven by substantial increases in fund management and financial advisory service revenue 2019 Fiscal Year Key Performance Indicators | Indicator | 2019 (Singapore Dollars) | 2018 (Singapore Dollars) | Year-over-Year Growth | | :--- | :--- | :--- | :--- | | Net Profit | Approx. 4.6 million | - | >300% | | Fund Management Service Revenue | Approx. 5.1 million | Approx. 1.9 million | 172.1% | | Financial Advisory Service Revenue | Approx. 2.2 million | Approx. 0.231 million | 866.7% | - The Group, through a joint venture with Australian fund manager iProsperity Group, acquired a portfolio of up to 23 hotels across five major Australian cities, one of the largest hotel portfolio acquisitions in Australia in recent years[13] - The Group participated in the development of "The Landmark" residential project in Singapore, located at the edge of the Central Business District, as part of the government's Greater Southern Waterfront development master plan[13] - The financial advisory services segment expanded during the year, utilizing SFC Type 1, 4, and 6 licenses, participating in the listing of four Singaporean companies on the Stock Exchange, and was appointed as an investment advisor for a family office with approximately USD 100 million in assets under management[12][13] Future Outlook and Strategy Looking ahead, the Group aims to maintain its leading position in integrated asset management in Singapore and plans to expand its business into the Asia-Pacific and broader regions, focusing on organizational strengthening, customer experience, and digital transformation - The Group plans three operational transformations: strengthening organizational structure and human capital investment, focusing on a customer-centric experience, and enhancing business services and processes through digital transformation[18] - Business strategies include leveraging its strong network in Singapore to provide advisory services for local SMEs on financing, M&A, and listing processes, and continuing to increase revenue by issuing fund products in Singapore and Hong Kong[18] - The Group will focus on developing its family fund business, utilizing Singapore government policies supporting the establishment of family fund headquarters to assist family offices with project development and asset acquisition[19] Corporate Information Board of Directors and Advisors This section provides a detailed list of the company's board members, committee compositions, key executives, and external advisors, including Ernst & Young as auditor and Ascent Partners Corporate Finance Limited as compliance advisor Company Key Positions and Institutions | Position Category | Name/Institution | | :--- | :--- | | Executive Directors | Ms. Shen Juanjuan (Chairperson), Mr. Yao Junyuan (CEO), Mr. Wong Hin Ying (Deputy CEO), Mr. Siow Keng Yee (Deputy CEO & CFO), Mr. Chew Yong Siang (COO) | | Independent Non-Executive Directors | Mr. Kong Chee Weng, Dato' Dr. Sim Mong Keang, Mr. Lim Boon Yew | | Non-Executive Director | Mr. Chew Hong Yeow | | Audit Committee Chairman | Mr. Kong Chee Weng | | Remuneration Committee Chairman | Dato' Dr. Sim Mong Keang | | Nomination Committee Chairman | Mr. Lim Boon Yew | | Compliance Advisor | Ascent Partners Corporate Finance Limited | | Auditor | Ernst & Young | Five-Year Financial Summary Financial Performance and Position This section outlines the Group's key financial data over the past five fiscal years, showing 2019 revenue of SGD 14.92 million, a significant rebound in profit before tax and net profit to SGD 4.99 million and SGD 4.62 million respectively, and an increase in net assets/total equity to SGD 37.59 million, indicating a robust financial position Five-Year Performance Overview (Thousand Singapore Dollars) | Indicator | 2019 | 2018 | 2017 | 2016 | 2015 | | :--- | :--- | :--- | :--- | :--- | :--- | | Revenue | 14,919 | 11,786 | 18,583 | 11,493 | 8,711 | | Profit Before Tax | 4,994 | 1,115 | 6,439 | 3,413 | 6,040 | | Profit for the Year Attributable to Owners of the Company | 4,622 | 1,081 | 6,630 | 3,587 | 5,986 | Five-Year Assets, Liabilities, and Equity Overview (Thousand Singapore Dollars) | Indicator | 2019 | 2018 | 2017 | 2016 | 2015 | | :--- | :--- | :--- | :--- | :--- | :--- | | Total Non-Current Assets | 3,595 | 4,581 | 5,423 | 17,480 | 15,218 | | Total Current Assets | 36,770 | 32,906 | 14,787 | 9,415 | 8,820 | | Total Current Liabilities | 2,566 | 2,173 | 4,299 | 4,398 | 2,338 | | Net Assets / Total Equity | 37,585 | 35,089 | 15,468 | 22,325 | 21,211 | Management Discussion and Analysis Overview The Group, as an integrated asset management company, manages 28 real estate projects across Singapore, Malaysia, Indonesia, and Australia, successfully expanding its business in 2019 through a major Australian hotel portfolio acquisition and the establishment of family office management services - The Group formed ZACD Australia Hospitality Fund with Australian fund manager iProsperity Group to jointly acquire a portfolio of up to 23 hotels in Australia, valued at AUD 212.6 million[39] - The Group expanded into family office management services and was appointed as an investment advisor for a family office with approximately USD 100 million in assets under management[37] Financial Review and Business Review In FY2019, the Group's net profit after tax was approximately SGD 4.6 million, a significant year-over-year increase of 327.6%, primarily due to increased revenue from fund management and financial advisory businesses and reduced listing expenses, with total revenue growing by 26.6% to SGD 14.9 million 2019 Fiscal Year Financial Performance Summary | Indicator | 2019 (Thousand Singapore Dollars) | 2018 (Thousand Singapore Dollars) | Year-over-Year Change | | :--- | :--- | :--- | :--- | | Revenue | 14,919 | 11,786 | +26.6% | | Net Profit After Tax | 4,622 | 1,081 | +327.6% | - The significant profit growth was due to increased revenue (primarily from fund management and financial advisory businesses) and no listing expenses in 2019 (compared to SGD 1 million in 2018), partially offset by higher staff costs and income tax expenses[39][53] Segment Performance Analysis This section details the revenue and performance of each business segment, highlighting fund management and financial advisory services as the main growth drivers in 2019, while other segments experienced declines due to project cycle completion or non-renewal of contracts Revenue and Performance by Business Segment (Thousand Singapore Dollars) | Business Segment | 2019 Revenue | 2018 Revenue | Revenue Change | 2019 Segment Performance | 2018 Segment Performance | | :--- | :--- | :--- | :--- | :--- | :--- | | Special Purpose Entity Investment Management | 3,328 | 4,407 | -24.5% | 2,361 | 3,409 | | Fund Management | 5,094 | 1,872 | +172.1% | 4,058 | 338 | | Acquisition and Project Management | 982 | 1,690 | -41.9% | 557 | 1,255 | | Property and Leasing Management | 3,282 | 3,586 | -8.5% | (177) | (139) | | Financial Advisory | 2,233 | 231 | +866.7% | 849 | (691) | | Total | 14,919 | 11,786 | +26.6% | 7,648 | 4,172 | - Fund management revenue significantly increased, primarily stemming from approximately AUD 3.2 million in acquisition fees received by the Group from the investment entity established for the acquisition of the Australian hotel portfolio[50] - Financial advisory service revenue surged, mainly due to the Group being appointed as an investment advisor for a family office with approximately USD 100 million in assets under management, earning approximately SGD 1.5 million in fees[52] - Special purpose entity investment management revenue decreased by 24.5%, primarily because the number of investment entities recording dividends decreased from 13 to 11 in 2019, and new dividend-generating projects contributed less than in previous years[45] Liquidity and Capital Resources The Group adopted prudent financial management, maintaining robust liquidity with no bank borrowings as of the end of 2019, a significant increase in cash and cash equivalents to SGD 18.34 million due to transitional loan repayments, and net current assets rising to SGD 34.20 million, demonstrating a strong financial foundation Key Liquidity Indicators (Thousand Singapore Dollars) | Indicator | December 31, 2019 | December 31, 2018 | | :--- | :--- | :--- | | Cash and Cash Equivalents | 18,342 | 7,708 | | Trade Receivables | 10,675 | 4,160 | | Net Current Assets | 34,204 | 30,733 | | Bank Facilities or Borrowings | 0 | 0 | - The significant increase in cash and cash equivalents was primarily attributable to the full repayment of transitional loans from ZACD Yield Trust, ZACD (Development2) Ltd., and ZACD (Shunfu2) Ltd. in 2019 (these loans and receivables were approximately SGD 20 million at the end of 2018)[60][63] Business Outlook The Group is optimistic about future business development but remains cautious about the short-term impact of COVID-19, planning to advance Singaporean residential and industrial projects, maintain confidence in the Australian market's long-term growth, and enhance fund management services while expanding international cooperation and family office management - Singapore Market: Expected increases in private residential prices will positively impact The Landmark redevelopment project; concurrently, the Group has successfully secured development rights for an industrial site in Mandai and is establishing a new development fund for it[69] - Australian Market: Despite impacts from bushfires and the pandemic, the Group remains optimistic about the long-term strong growth of Australia's tourism industry, viewing it as the foundation supporting its hotel investment portfolio value[71] - Future Strategy: Plans to enhance fund management services by identifying attractive real estate investment opportunities and establishing collaborations with investment companies in various regions to explore investment opportunities in Malaysia, Australia, China, and the United States[72] - The Group will continue to focus on developing family office management services and expand its corporate advisory teams in Singapore and Hong Kong to support business growth[73] Use of Proceeds The net proceeds from the company's listing were approximately SGD 21.6 million, with the transitional reserve fund and general working capital 100% utilized by the end of 2019, while other business segments had lower utilization rates due to cautious market conditions, leading the Board to reallocate approximately SGD 7.2 million of unutilized funds to the transitional reserve fund in March 2020 to enhance project investment competitiveness Use of Listing Proceeds and Utilization Rate (As of December 31, 2019) | Purpose | Allocated Net Amount (Thousand SGD) | Utilization Rate (%) | | :--- | :--- | :--- | | Transitional Reserve Fund | 8,900 | 100.0% | | Investment Management | 3,400 | 19.5% | | Acquisition and Project Management | 900 | 53.9% | | Property and Leasing Management | 3,300 | 50.9% | | Financial Advisory | 3,500 | 21.9% | | General Working Capital | 1,600 | 100.0% | - Due to unfavorable macroeconomic conditions in Singapore and fewer-than-expected project acquisitions, the Group adopted a cautious approach to new hires and expansion, leading to lower fund utilization across several business segments[80] - The Board decided on March 13, 2020, to reallocate approximately SGD 7.2 million of unutilized proceeds from four business segments to expand the scope of the transitional reserve fund, to be used for seed funding new potential real estate projects[81][82] Biographies of Directors Background of Board Members This section details the personal resumes, professional backgrounds, and industry experience of the company's executive, non-executive, and independent non-executive directors, highlighting the extensive real estate investment and management experience of founders Ms. Shen Juanjuan and Mr. Yao Junyuan, and the deep professional knowledge of other board members in finance, accounting, law, and corporate management, supporting the Group's stable operations and strategic development - Executive Director and CEO Mr. Yao Junyuan, one of the Group's founders, has over 13 years of experience in industrial property development in Singapore, primarily responsible for the Group's operations, strategic planning, and development[87] - Executive Director and Chairperson Ms. Shen Juanjuan, one of the Group's founders, has approximately 23 years of cross-border real estate investment experience, previously worked at Colliers International, and is primarily responsible for the Group's marketing activities and overall administrative management[89][90] - Executive Director, Deputy CEO, and CFO Mr. Siow Keng Yee, has over 20 years of corporate finance, M&A, accounting, and auditing experience, and is a licensed responsible officer for the company in Hong Kong, responsible for Type 1, 4, and 6 regulated activities[94] - Independent Non-Executive Director Mr. Kong Chee Weng, has over 21 years of experience in accounting, auditing, financial management, and corporate governance, and holds positions in several Hong Kong Main Board listed companies, providing independent advice to the Board[101] Environmental, Social and Governance Report Environmental Aspect (A1, A2, A3) The Group is committed to minimizing its environmental impact, with minimal operational emissions primarily from office consumption, and in 2019, effective management reduced copy paper usage by 20% and printer cartridge usage by 36.3% through energy and water saving measures, waste paper recycling, and encouraging public transport use 2019 Office Resource Consumption Comparison | Item | 2018 Fiscal Year | 2019 Fiscal Year | Change | | :--- | :--- | :--- | :--- | | Average Monthly Paper Usage | 7.5 reams | 6 reams | -20.00% | | Average Monthly Printer Cartridge Usage | SGD 1,724.83 | SGD 1,098.68 | -36.30% | - The Group's daily operational energy consumption is mainly office electricity, with an average monthly consumption of 7,022 kWh; the Group saves energy by automatically turning off air conditioning and lights after work hours[120] Social Aspect (B1-B8) The Group views employees as its most valuable asset, committed to providing equal employment opportunities, competitive compensation, and career development, with 98 employees and a 25% annual turnover rate as of 2019, implementing comprehensive safety policies with no work-related injuries, and engaging in various community welfare activities through the "ZACD Care Group" Employee Profile as of December 31, 2019 | Category | Quantity/Ratio | | :--- | :--- | | Total Employees | 98 people | | Gender Distribution | Male 54%, Female 46% | | Age Distribution | Under 30 30%, 31-50 58%, Over 50 12% | | Employment Type | Full-time 99%, Part-time 1% | | Annual Turnover Rate | 25% | - The Group implemented a Flexible Work Arrangement (FWA) program and provides benefits such as birthday leave, marriage leave, and examination leave to enhance employee work-life balance[131] - In terms of health and safety, the Group had no lost workdays due to work-related injuries and no work-related fatalities during the year[143] - The Group adopts a zero-tolerance policy towards corruption, with no confirmed corruption incidents or suspected cases during the year[153][155] - In terms of community contributions, the Group organized various CSR activities, including sponsoring sports events for TOUCH Silent Club, organizing museum visits for seniors, and holding Christmas events for underprivileged children[156][157][158][159] Directors' Report Dividends and Reserves The Board approved and paid an interim dividend of SGD 1 million in August 2019, equivalent to 0.05 Singapore cents per share, but does not recommend paying a final dividend for FY2019, with distributable reserves of approximately SGD 3.964 million as of December 31, 2019 - The Board approved and paid an interim dividend of SGD 1,000,000 (0.05 Singapore cents per ordinary share) for the fiscal year ended December 31, 2019, on September 6, 2019[169] - The Board does not recommend paying a final dividend for the fiscal year ended December 31, 2019[169] - As of December 31, 2019, the Group's distributable reserves were approximately SGD 3,964,000[184] Major Customers and Suppliers In FY2019, the Group experienced high customer concentration, with sales to the top five customers accounting for 45.5% of total sales and the largest single customer accounting for 20.2%, while having no major suppliers due to staff costs and professional fees being its primary expenses - During the fiscal year, sales to the Group's top five customers accounted for 45.5% of total sales[185] - Sales to the largest customer accounted for 20.2% of total sales[185] Directors' Interests in Shares This section discloses directors' share interests in the Company and related corporations, with controlling shareholders Mr. Yao Junyuan and Ms. Shen Juanjuan deemed to have an interest in 1,328,800,000 ordinary shares, representing 66.44% of the issued share capital through their jointly controlled ZACD Investments Pte. Ltd., and other executive directors also holding company shares Major Directors' Long Positions in the Company's Ordinary Shares (As of December 31, 2019) | Director Name | Capacity | Number of Shares Held | Percentage of Total Issued Shares | | :--- | :--- | :--- | :--- | | Mr. Yao Junyuan | Controlled Corporation Interest | 1,328,800,000 | 66.44% | | Ms. Shen Juanjuan | Controlled Corporation Interest | 1,328,800,000 | 66.44% | | Mr. Siow Keng Yee | Personal Beneficial Ownership | 22,000,000 | - | | Mr. Chew Yong Siang | Personal Beneficial Ownership | 20,000,000 | - | - Mr. Yao and Ms. Shen are spouses and are deemed to have a joint interest in the Company's shares held by ZACD Investments Pte. Ltd. (which they jointly hold 51% and 49% respectively)[206] Share Option Scheme The Company adopted a share option scheme on December 13, 2017, to incentivize and reward eligible individuals, valid until January 15, 2028, with a maximum of 200 million shares (10% of issued shares at listing) available for grant, though no options had been granted as of December 31, 2019 - The share option scheme became effective on January 16, 2018, and is valid for 10 years, to expire on January 15, 2028[213] - The maximum number of shares that can be issued under the scheme is 200,000,000 shares, representing 10% of the issued shares at the time of listing[216] - As of December 31, 2019, the Company had not granted or agreed to grant any share options under the scheme[217] Continuing Connected Transactions During the fiscal year, the Group engaged in several continuing connected transactions, primarily involving providing investment management and property maintenance services to associated companies and receiving investment management fees from related parties, all reviewed by independent non-executive directors and the auditor, confirming they were conducted on normal commercial terms, in the overall interest of shareholders, and within annual caps Major Continuing Connected Transactions in FY2019 | Transaction Description | Connected Party | Relationship | Total Consideration (SGD) | | :--- | :--- | :--- | :--- | | Provision of Maintenance and Repair Services | Neew Pte. Ltd. | Wholly-owned by controlling shareholders | 555,000 | | Receipt of Investment Management Service Fees | ZACD (Sennett) Pte. Ltd. | Ultimate holding company and the Company collectively own over 30% | 54,000 | | Receipt of Investment Management Service Fees | ZACD (Woodlands2) Pte. Ltd. | Ultimate holding company and the Company collectively own over 30% | 380,000 | | Receipt of Investment Management Service Fees | ZACD Investments Pte. Ltd. | Ultimate holding company | 63,000 | - Independent non-executive directors reviewed and confirmed that all continuing connected transactions were entered into in the ordinary course of the Group's business, on normal commercial terms, and were fair and reasonable, in the overall interest of shareholders[240] - The Company's auditor, Ernst & Young, issued an unqualified opinion letter regarding the continuing connected transactions, confirming that the transactions complied with relevant regulations and did not exceed the annual caps[240][241] Corporate Governance Report Board and Committees The Company is committed to high corporate governance, with a 9-member Board including 3 independent non-executive directors, complying with listing rules, and three committees (Audit, Nomination, Remuneration) all chaired by independent non-executive directors, with the Board and committees holding multiple meetings to deliberate on significant company matters, and the roles of Chairperson and CEO held by spouses Ms. Shen Juanjuan and Mr. Yao Junyuan, an arrangement the Board believes is conducive to strong and consistent leadership - The Board comprises 9 directors, of whom 3 are independent non-executive directors, accounting for one-third of the Board members, complying with GEM Listing Rules[253][254] - The roles of Chairperson (Ms. Shen Juanjuan) and CEO (Mr. Yao Junyuan) are distinct but held by spouses; the Board believes this arrangement provides strong and consistent leadership[258] FY2019 Board and Committee Meeting Attendance Record | Director Name | Board | Audit Committee | Remuneration Committee | Nomination Committee | Annual General Meeting | | :--- | :--- | :--- | :--- | :--- | :--- | | Mr. Yao Junyuan | 4/4 | N/A | N/A | 1/1 | 1/1 | | Ms. Shen Juanjuan | 2/4 | N/A | 1/2 | N/A | 1/1 | | Mr. Siow Keng Yee | 4/4 | N/A | N/A | N/A | 1/1 | | Mr. Kong Chee Weng (INED) | 3/4 | 3/4 | 2/2 | 1/1 | 1/1 | | Dato' Dr. Sim Mong Keang (INED) | 4/4 | 4/4 | 2/2 | 1/1 | 1/1 | | Mr. Lim Boon Yew (INED) | 4/4 | 4/4 | 2/2 | 1/1 | 1/1 | Internal Control and Shareholder Communication The Board is responsible for maintaining adequate internal control systems to safeguard shareholder investments and company assets, considering existing systems effective and sufficient, with established compliance and internal audit departments, a risk register, and an audit plan, while maintaining effective communication with shareholders through various channels and clear procedures for convening extraordinary general meetings - The Board is responsible for maintaining and reviewing the effectiveness of internal control systems and considers the company's existing internal control systems effective and sufficient[293] - The company has established compliance and internal audit departments, identifying specific risk areas through a risk register and developing an annual audit plan[293] - The company provides shareholders with detailed procedures for convening extraordinary general meetings, where shareholders holding not less than 10% of the voting shares have the right to request the Board to convene a meeting[297] Independent Auditor's Report Audit Opinion Auditor Ernst & Young issued an unqualified opinion on the Group's consolidated financial statements, affirming they were properly prepared in accordance with the Companies Act, IFRS, and SFRS(I), and fairly and truly reflect the Group's financial position as of December 31, 2019, and its financial performance for the year then ended - The auditor believes that the financial statements truly and fairly reflect the Group's financial position and performance[305] Key Audit Matters A key audit matter identified in this audit was "Valuation of Equity Securities Investments," as these unlisted equities lack active market quotations, and their fair value is determined using valuation techniques like discounted cash flow models, involving significant management judgment in assumptions and estimates, thus presenting estimation uncertainty - The key audit matter is "Valuation of Equity Securities Investments"[307][309] - These investments are measured at fair value, but as there are no active market quotations, their valuation relies on internal model techniques involving significant unobservable data, presenting estimation uncertainty and classified as Level 3 financial instruments[309] Consolidated Financial Statements Consolidated Statement of Profit or Loss and Consolidated Statement of Comprehensive Income In FY2019, the Group achieved revenue of SGD 14.919 million, a 26.6% year-over-year increase, with profit before tax at SGD 4.994 million and profit for the year attributable to owners at SGD 4.622 million, a significant increase from 2018, though other comprehensive loss of SGD 1.126 million from fair value changes in equity securities investments resulted in a total comprehensive income of SGD 3.496 million Consolidated Statement of Profit or Loss Summary (Thousand Singapore Dollars) | Item | 2019 | 2018 | | :--- | :--- | :--- | | Revenue | 14,919 | 11,786 | | Profit Before Tax | 4,994 | 1,115 | | Profit for the Year Attributable to Owners of the Company | 4,622 | 1,081 | | Basic Earnings Per Share (cents) | 0.23 | 0.05 | Consolidated Statement of Comprehensive Income Summary (Thousand Singapore Dollars) | Item | 2019 | 2018 | | :--- | :--- | :--- | | Profit for the Year | 4,622 | 1,081 | | Other Comprehensive Loss | (1,126) | (1,608) | | Of which: Fair value changes of equity securities investments | (1,127) | (1,552) | | Total Comprehensive Income for the Year Attributable to Owners of the Company | 3,496 | (527) | Statement of Financial Position As of December 31, 2019, the Group's total assets were SGD 40.365 million, total liabilities were SGD 2.780 million, and total equity was SGD 37.585 million, indicating a healthy financial structure with strong short-term solvency due to current assets of SGD 36.770 million significantly exceeding current liabilities of SGD 2.566 million, and notably, approximately SGD 20 million in "loans and related receivables" from 2018 was reduced to zero Consolidated Statement of Financial Position Summary (Thousand Singapore Dollars) | Item | December 31, 2019 | December 31, 2018 | | :--- | :--- | :--- | | Total Non-Current Assets | 3,595 | 4,581 | | Total Current Assets | 36,770 | 32,906 | | Total Assets | 40,365 | 37,487 | | Total Current Liabilities | 2,566 | 2,173 | | Total Non-Current Liabilities | 214 | 225 | | Total Liabilities | 2,780 | 2,398 | | Total Equity | 37,585 | 35,089 | Consolidated Statement of Cash Flows In FY2019, the Group's cash and cash equivalents increased by SGD 10.519 million, with a net cash outflow of SGD 1.572 million from operating activities primarily due to increased trade receivables, a significant net cash inflow of SGD 13.669 million from investing activities driven by the recovery of nearly SGD 20 million in transitional loans, and a net cash outflow of SGD 1.578 million from financing activities mainly for dividend payments and lease liability repayments Consolidated Statement of Cash Flows Summary (Thousand Singapore Dollars) | Item | 2019 | 2018 | | :--- | :--- | :--- | | Net Cash Flow from Operating Activities | (1,572) | 2,916 | | Net Cash Flow from Investing Activities | 13,669 | (16,351) | | Net Cash Flow from Financing Activities | (1,578) | 18,585 | | Net Increase in Cash and Cash Equivalents | 10,519 | 5,150 | | Cash and Cash Equivalents at End of Year | 18,342 | 7,708 | - Cash flow from investing activities turned positive, mainly due to the recovery of SGD 19.968 million in transitional loans and related interest[347] Notes to the Financial Statements Note 3: Significant Accounting Judgments, Estimates, and Assumptions This note reveals key management judgments and estimates in financial statement preparation, including consolidation of investment special purpose entities (SPEs) and private real estate funds, recognition of performance fees, and fair value measurement of equity securities investments and expected credit loss provisions for trade receivables, all involving significant uncertainty due to unobservable input data and future forecasts - Significant Judgment: The Group needs to determine whether it acts as an agent or principal in the SPEs and funds it manages, thereby deciding whether to consolidate them into the consolidated statements; as of the end of 2019, the Group believed it did not control the 22 SPEs and 7 private equity funds it managed[455][457] - Significant Estimate: Fair value measurement of equity securities investments is a significant estimate; as these investments have no market quotations, their valuation relies on discounted cash flow (DCF) models, where inputs such as future cash flows, uncertainty discounts (68%-96%), and discount rates involve significant estimation[461][645] - Significant Estimate: The provision for expected credit losses (ECL) on trade receivables is another significant estimate; the Group uses a provision matrix based on historical default rates combined with forward-looking information to calculate ECL, which involves forecasting future economic conditions[462] Note 4: Operating Segment Information This note provides detailed segment information by business and geographical area, showing Singapore as the primary revenue source at SGD 9.664 million (though a decrease), significant growth in Australian market revenue to SGD 3.152 million, and revenue from the largest single customer (Customer A) accounting for 20.2% of total revenue, indicating some customer concentration Revenue from External Customers by Geographical Location (Thousand Singapore Dollars) | Region | 2019 | 2018 | | :--- | :--- | :--- | | Singapore | 9,664 | 10,518 | | Australia | 3,152 | 413 | | British Virgin Islands | 1,496 | – | | Malaysia | 306 | 474 | | Indonesia | 5 | 314 | | Other | 296 | 67 | | Total | 14,919 | 11,786 | - Revenue from the single largest customer (Customer A) was SGD 3.008 million, accounting for 20.2% of the Group's total revenue[488] Note 14: Equity Securities Investments This note details equity securities investments, a key audit matter, representing the Group's equity holdings or contractual rights in unlisted investment special purpose entities (SPEs) as consideration for investment management services; as of 2019, their fair value was SGD 2.297 million, a decrease from SGD 3.424 million, with a loss of SGD 1.127 million from fair value changes recognized in other comprehensive income Fair Value of Equity Securities Investments (Thousand Singapore Dollars) | Item | December 31, 2019 | December 31, 2018 | | :--- | :--- | :--- | | Unlisted Equity Shares, at Fair Value | 1,299 | 1,739 | | Contractual Rights to Unlisted Equity Shares, at Fair Value | 998 | 1,685 | | Total | 2,297 | 3,424 | - These investments represent formation shares or contractual rights to future formation shares obtained by the Group for providing services to SPE investors, with returns realized through dividend distributions from SPEs[538] - During the year, a fair value change loss of SGD 1,127,000 related to equity securities investments was recognized in other comprehensive income[536] Note 28: Related Party Transactions This note discloses numerous transactions between the Group and related parties, including dividend income, fund management fees, and project management fees from associated investment entities and development projects, as well as maintenance and repair service fees and rental expenses paid to related parties, demonstrating the close ties between the Group's business and its controlling shareholders and other related entities Major Related Party Transaction Revenue in 2019 (Thousand Singapore Dollars) | Revenue Type | Amount | | :--- | :--- | | Investment Management - Dividend Income | 3,077 | | Investment Management - Fund Management Fees | 1,404 | | Project Management Fees | 650 | Major Related Party Transaction Expenses in 2019 (Thousand Singapore Dollars) | Expense Type | Amount | | :--- | :--- | | Repair and Maintenance Service Expenses | 555 | | Lease Expenses | 33 | - Total remuneration for key management personnel (including directors) was SGD 1,069,000[621] Note 30: Contingent Liabilities This note reveals significant contingent liabilities faced by the Group, specifically large guarantees provided for two major real estate development projects, which constitute potential significant financial risks crucial for assessing the company's overall risk profile, despite not being actual liabilities at the reporting date - The Company provided loan financing guarantees totaling SGD 150,744,796 for the residential redevelopment project at 173 Chin Swee Road, Singapore (Landmark Development)[626] - The Company provided loan financing guarantees totaling SGD 38,015,040 for the integrated development project at Bukit Batok West Avenue 6, Singapore (BBW6 Development)[627] Note 33: Financial Risk Management The Group faces major financial risks including credit risk, liquidity risk, and foreign currency risk, with credit risk stemming from customer concentration (top five debtors accounting for 69% of receivables), liquidity risk managed by maintaining sufficient cash, and foreign currency risk from HKD and AUD assets impacting profit, while capital management aims to ensure continuous operation and compliance with regulatory capital requirements - Credit Risk: There is customer concentration risk; as of the end of 2019, receivables from the largest debtor accounted for 28%, and from the top five debtors accounted for 69%[658] - Liquidity Risk: The Group manages liquidity risk by monitoring and maintaining adequate levels of cash and cash equivalents[659] - Foreign Currency Risk: The Group holds HKD and AUD assets, and exchange rate fluctuations can affect profit; for example, a 4% change in the SGD to AUD exchange rate would result in an approximate SGD 0.244 million change in profit before tax[668][670] - Capital Management: The Group is regulated by MAS and SFC, subject to minimum capital requirements, and has established a legal and compliance department for monitoring[672]