Financial results for the year ended 30 June 2012

RNS Number : 4063P

VinaCapital Vietnam Opp. Fund Ld

24 October 2012

 



24 October 2012

VinaCapital Vietnam Opportunity Fund Limited

Audited financial results for the twelve months ended 30 June 2012

VinaCapital Vietnam Opportunity Fund Limited (the "Company" or "VOF"), an investment company focused on Vietnam, today announces its full year results for the twelve months ended 30 June 2012 ("the Period").

Financial highlights

·      Net profit of USD28.4 million (FY11: net loss of USD36.2 million).

·      Net earnings per share of USD0.09 (FY11: net loss of USD0.11).

·      Net asset value at 30 June 2012 of USD766 million representing USD2.45 per share.

Operational highlights during the Period

·      Divested an equity stake in Hoan My Medical hospital group to Fortis Healthcare Group.

·      Divested VOF's entire stake in NIVL, one of the largest sugar producing groups in Vietnam.

·      Acquired the remaining 75 percent stake in the Clear Interest Group (CIG) which holds, among other assets, a 19.95 percent interest in the Legend Hotel.

·      Secured shareholder approval to undertake a share buyback programme, with 12.6 million shares repurchased as at 30 June 2012

Commenting, Andy Ho, Managing Director of VOF's Investment Manager, said:

"VOF has performed solidly against what has been a difficult economic backdrop caused by continued high interest rates, inflation and currency depreciation.  Our net asset value remains stable, and we have returned a net profit over the course of the year.  We have also made a number of successful divestments despite a lacklustre environment for private equity deals, including the sale of equity stakes in NIVL and Hoan My Medical hospital group.  Our investment strategy will continue to focus around the core industries most likely to benefit from the expected long-term growth in domestic consumption, including consumer goods, banking, education and healthcare."

Notes to Editors:

VinaCapital is a leading investment management and real estate development firm in Vietnam, with a diversified portfolio of USD1.6 billion in assets under management. VinaCapital was founded in 2003 and boasts a team of managing directors who bring extensive international finance and investment experience to the firm. Our mission is to produce superior returns for investors by using our experience and knowledge to identify the key trends and opportunities that emerge as Vietnam continues to develop its economy. To achieve this, VinaCapital has industry-leading asset class teams covering capital markets, private equity, fixed income, venture capital, real estate and infrastructure.

VinaCapital manages three closed-end funds trading on the AIM Market of the London Stock Exchange. These funds are: VinaCapital Vietnam Opportunity Fund Limited (VOF), VinaLand Limited (VNL), and Vietnam Infrastructure Limited (VNI). VinaCapital also co-manages the DFJ VinaCapital L.P. technology venture capital fund with Draper Fisher Jurvetson.

VinaCapital has offices in Ho Chi Minh City, Hanoi, Danang, Nha Trang, Phnom Penh (Cambodia) and Singapore. More information about VinaCapital is available at www.vinacapital.com

More information on VinaCapital Vietnam Opportunity Fund Limited is available at www.vinacapital.com/vof

Enquiries:

David Dropsey
VinaCapital Investment Management Limited
Investor Relations/Communications
[phone]
[e-mail]

Philip Secrett

Grant Thornton Corporate Finance, Nominated Adviser

[phone]

[e-mail]

 
Hiroshi Funaki
LCF Edmond de Rothschild Securities, Broker
[phone]
[e-mail]

David Benda / Hugh Jonathan
Numis Securities Limited, Broker
[phone]

Mark Walters
FTI Consulting, Public Relations (Hong Kong)
[phone]
[e-mail]

Andrew Walton
FTI Consulting, Public Relations (London)
[phone]
[e-mail]

Chairman's statement

Dear shareholders,

The 2012 financial year saw Vietnam's economy continue to endure difficult conditions caused by high interest rates and inflation along with currency depreciation. However, after hitting a peak of 23 percent in August 2011, Vietnam's CPI has fallen rapidly throughout the year. The adoption and execution of a 'crawling peg' currency policy has alleviated some inflationary pressure and helped stabilize the VND against the USD. Unfortunately, the trade-off for controlling inflation has been slower growth. During the first half of 2012, GDP growth in Vietnam slowed to 4.4 percent, well below the long term historical average of approximately 7.0 percent annually.

Over the past twelve months, VOF has maintained a stable net asset value and increased its cash position despite the poor performance of Vietnamese listed equity and real estate markets. The company was able, despite a lackluster environment for private equity deals, to divest several assets, including the Hoan My Hospital and NIVL. The fund continues to focus its investments on a core group of industries such as consumer goods, agriculture, healthcare, education and banks, which seek to benefit from the expected long term growth in domestic consumption.

VOF's audited net asset value at the end of June 2012 was USD765.6 million or USD2.45 per share, 5.6 percent above the NAV per share at the end of June 2011 of USD2.32.  VOF's share price as at 30 June 2012 was USD1.48, down 5.7 percent compared to USD1.57 as at 30 June 2011; representing a share price discount to NAV of 38 percent.

VOF obtained shareholder approval on 25 October 2011 to modify its articles of association to permit it to acquire its own shares through a variety of means. By 30 June 2012 the company spent nearly USD18.6 million repurchasing approximately 12.6¹ million shares on the market, the consequence of which has been to stabilise the share price in a declining market.  In fact since 30 June 2012 the fund's share price has climbed to USD1.72, effectively reducing the discount rate to approximately 29 percent, following a further repurchase of 21.4 million shares since the period end.

Over the next six to twelve months, the Board and manager will continue to keep an open dialogue with shareholders updating you on the progress of the fund in achieving its strategic objectives. Specifically, we will be reviewing the fund's strategy, governance practices, and the investment management agreement, with the purpose of aligning them with best practice before next year's continuation vote.  These will specifically include changing the composition of the Board of Directors with the intention of increasing the number of independent non-executive directors and preparing for my future retirement from the Board in 2013.

We thank you for your continued support.

William Vanderfelt

Chairman

VinaCapital Vietnam Opportunity Fund Ltd

22 October 2012

¹ there is a difference of 475,000 shares in the calculation of total shares repurchased between the Chairman's statement and note 16 of the consolidated financial statements. This results from a timing difference between repurchase in the current fiscal year end and settlement post fiscal year end.

CONSOLIDATED BALANCE SHEET

		30 June 2012	30 June 2011
	Note	USD'000	USD'000
ASSETS
Non-current
Plant and equipment		800	572
Investment property	5	1,785	3,445
Interests in associates	6	199,137	247,570
Prepayment for acquisition of investment property	7	7,500	8,986
Available-for-sale financial assets	8	6,111	16,923
Long-term loan to an associate	29(e)	-	7,115
Other non-current assets		583	95
Total non-current assets		────── 215,916    ──────	────── 284,706 ──────
Current
Inventories	10	6,090	2,380
Trade and other receivables	11	14,611	12,054
Short-term loans to related parties	29(e)	10,771	6,337
Financial assets at fair value through profit or loss	12	425,281	383,782
Available-for-sale financial assets	8	28,450	-
Short-term investment		-	27
Cash and cash equivalents (excluding bank overdraft)	13	42,209	62,968
Total current assets		────── 527,412   ──────	────── 467,548 ──────
Assets classified as held for sale	14	32,127	12,349
Total assets		────── 775,455                ══════	────── 764,603 ══════

		30 June 2012	30 June 2011
	Note	USD'000	USD'000
EQUITY AND LIABILITIES
EQUITY
Equity attributable to owners of the parent
Share capital	15	3,246	3,246
Additional paid-in capital		722,064	722,064
Treasury shares	16	(17,785)	-
Revaluation reserve	17	28,602	27,513
Available-for-sale financial assets reserve		14,180	-
Translation reserve		(17,011)	(4,834)
Retained earnings		32,349	3,917
Total equity		────── 765,645 ──────	────── 751,906 ──────
LIABILITIES
Non-current
Deferred tax liabilities		101	101
Other long-term liabilities		175	55
Total non-current liabilities		────── 276 ──────	────── 156 ──────
Current
Short-term borrowings	18	2,588	-
Trade and other payables	19	4,787	3,932
Payable to related parties	29(d)	2,159	8,609
Total current liabilities		────── 9,534 ──────	────── 12,541 ──────
Total liabilities		9,810 ──────	12,697 ──────
Total equity and liabilities		775,455 ══════	764,603 ══════
Net asset value, USD per share	26(c)	2.45	2.32
		══════	══════

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

			Attributable to equity holders of the Company
	Share capital	Additional paid-in capital		Treasury shares	Revaluation reserve	Available-for-sale financial assets  reserve	Translation reserve	Retained earnings	Total	Non-controlling interest	Total equity
	USD'000	USD'000		USD'000	USD'000	USD'000	USD'000	USD'000	USD'000	USD'000	USD'000
Balance at 1 July 2010	3,246	722,064		-	21,193	-	(3,762)	39,760	782,501	1,427	783,928
Loss for the year	-	-		-	-	-	-	(36,285)	(36,285)	106	(36,179)
Other comprehensive income/(loss)	-	-		-	6,320	-	(1,072)	-	5,248	(30)	5,218
	─────	───────		─────	──────	─────	──────	──────	───────	──────	───────
Total comprehensive income/(loss) for the year	-	-		-	6,320	-	(1,072)	(36,285)	(31,037)	76	(30,961)
Acquisition of non-controlling interest	-	-		-	-	-	-	442	442	(1,056)	(614)
Disposal of subsidiary	-	-		-	-	-	-	-	-	(447)	(447)
	─────	───────		─────	──────	─────	─────	──────	───────	──────	───────
Total transactions with owners	-	-		-	-	-	-	442	442	(1,503)	(1,061)
Balance at 30 June 2011	───── 3,246 ═════	─────── 722,064 ═══════		───── - ═════	────── 27,513 ══════	───── - ═════	───── (4,834) ═════	────── 3,917 ══════	─────── 751,906 ═══════	────── - ══════	─────── 751,906 ═══════
Balance at 1 July 2011	3,246	722,064		-	27,513	-	(4,834)	3,917	751,906	-	751,906
Profit for the year	-	-		-	-	-	-	28,432	28,432	-	28,432
Other comprehensive income/(loss)	-	-		-	1,089	14,180	(12,177)	-	3,092	-	3,092
	─────	───────		─────	──────	──────	──────	──────	───────	──────	───────
Total comprehensive income/(loss) for the year	-	-		-	1,089	14,180	(12,177)	28,432	31,524	-	31,524
Shares repurchased, representing   total transaction with owners (Note 16)	-	-		(17,785)	-	-	-	-	(17,785)	-	(17,785)
Balance at 30 June 2012	──── 3,246 ════	────── 722,064 ══════		───── (17,785) ═════	───── 28,602 ═════	───── 14,180 ═════	───── (17,011) ═════	───── 32,349 ═════	─────── 765,645 ═══════	───── - ═════	────── 765,645 ══════

CONSOLIDATED INCOME STATEMENT 

		Year ended
		30 June 2012	30 June 2011
	Note	USD'000	USD'000
Revenue	20	8,913	8,797
Cost of sales	20	(4,867) ─────	(7,059) ─────
Gross profit		4,046	1,738
Dividend income		20,710	16,725
Interest income	21(a)	3,413	4,142
Gain/(loss) from financial assets at fair value through profit or loss, net	22	27,491	(52,520)
Fair value loss on investment property	5	(1,660)	(301)
Other income	23	23,565	6,946
Selling, general and administration expenses	24	(19,498)	(20,155)
Other expenses		(11,622)	(4,056)
Operating profit/(loss)		───── 46,445 ─────	─────    (47,481) ─────
Finance income	21(b)	93	594
Finance costs	21(b)	(1,059) ─────	(4,171) ─────
Finance costs, net		(966)	(3,577)
Share of (losses)/profits of associates, net of tax	6	(16,347)	15,424
		─────   (17,313) ─────	─────   11,847 ─────
Profit/(loss) before tax		29,132	(35,634)
Corporate income tax	25	-	(203)
Withholding taxes imposed on investment income		(700)	(342)
Profit/(loss) for the year		─────            28,432 ═════	─────            (36,179) ═════
Profit/(loss) attributable to: Owners of the parent		28,432	(36,285)
Non-controlling interest		-	106
		─────  28,432 ─────	─────  (36,179) ─────
Earnings/(loss) per share  - basic and diluted (USD per share)	26(a), (b)	0.09 ═════	(0.11) ═════

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

		Year ended
		30 June 2012	30 June 2011
	Note	USD'000	USD'000
Profit/(loss) for the year		28,432	(36,179)
		─────	─────
Other comprehensive income/(loss)
- Share of revaluation reserve of associates	17	1,089	6,320
- Change in fair value of available-for-sale financial assets	8	14,180	-
- Currency translation differences	6	(12,177)	(1,102)
		─────	─────
Other comprehensive income for the year		3,092	5,218
		─────	─────
Total comprehensive income/(loss) for the year		31,524	(30,961)
		═════	═════
Attributable to: Owners of the parent		31,524	(31,037)
Non-controlling interest		-	76
		─────	─────
		31,524	(30,961)
		═════	═════

CONSOLIDATED STATEMENT OF CASH FLOWS

		Year ended
		30 June 2012	30 June 2011
	Note	USD'000	USD'000
Operating activities
Profit/(loss) before tax		29,132	(35,634)
Adjustments for:
Depreciation and write off of assets		299	442
Unrealised (gain)/loss from revaluation of financial assets at fair value through profit or loss	22	(22,920)	74,691
Net gain from realisation of financial assets at fair value through profit or loss	22	(4,571)	(22,171)
Loss on fair value changes of investment property	5	1,660	301
Loss of acquisition of investment		445	-
Gain on disposals of investments	23	(10,858)	(5,876)
Reversal of impairment loss	23	(9,400)	-
Impairment of assets		12,493	4,056
Share of losses/(profits) of associates	6	16,347	(15,424)
Unrealised losses from foreign exchange differences	21(b)	16	656
Interest expense	21(b)	172	460
Profit before changes in working capital		───── 12,815	───── 1,501
Change in trade receivables and other assets		(3,456)	(4,265)
Change in inventories		(3,710)	57
Change in trade payables and other liabilities		(6,728)	2,510
Withholding taxes imposed on investment income		(700)	(342)
Net cash outflow from operating activities		────   (1,779)	────   (539)
		────	────
Investing activities
Purchase of plant and equipment		(284)	(162)
Dividends received		4,000	1,500
Financial assets at fair value through profit or loss:
- Acquisition of investment		(82,484)	(70,294)
- Proceed from disposals		65,785	91,134
Investment in associates:
- Acquisition of investment		(22,000)	(7,038)
- Capital contribution into associate		(552)	-
- Proceed from disposals		14,199	11,668
Available-for-sale financial assets:
- Acquisition of investment	8	(2,223)	(7,112)
- Proceed from disposals		17,506	-
Proceed from disposal of short-term investments		-	401
Shareholder loans:
- Advanced made	29(e)	(1,259)	(7,496)
- Repayment received	29(e)	875	1,812
Net cash (outflow)/inflow from investing activities		─────     (6,437)	─────   14,413
		─────	─────

		Year ended
		30 June 2012	30 June 2011
	Note	USD'000	USD'000
Financing activities
Interest paid		(172)	(460)
Acquisition of non-controlling interest		-	(614)
Loan refunded from third party		2,985	-
Payment for buy back of shares		(17,785)	-
Loan proceed from banks, net of bank overdraft		1,413	-
		─────	─────
Net cash outflow from financing activities		(13,559)	(1,074)
		─────	─────
Net (decrease)/increase in cash and cash equivalents    for the year		(21,775)	12,800
Cash and cash equivalents at the beginning of the year	13	62,968	50,033
Exchange differences on cash and cash equivalents		(159)	135
		─────	─────
Cash and cash equivalents at the end of the year	13	41,034	62,968
		═════	═════

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

1.  GENERAL INFORMATION

VinaCapital Vietnam Opportunity Fund Limited ("the Company") is a limited liability company incorporated in the Cayman Islands. The registered office of the Company is PO Box 309GT, Ugland House, South Church Street, George Town, Grand Cayman, Cayman Islands. The Company's primary objective is to undertake various forms of investment primarily in Vietnam, but also in Cambodia, Laos and Southern China. The Company is listed on the AIM market of the London Stock Exchange under the ticker symbol VOF.

The Company does not have a fixed life, but the Board considers it desirable that shareholders should have the opportunity to review the future of the Company at appropriate intervals. Accordingly, the Board intends that a special resolution will be proposed every fifth year that the Company ceases to continue as presently constituted. If the resolution is not passed, the Company will continue to operate. If the resolution is passed, the directors will be required to formulate proposals to be put to shareholders to reorganise, unitise or reconstruct the Company or for the Company to be wound up. The Board tabled such a special resolution in 2008 and it was not passed, allowing the Company to continue as presently constituted. The next special resolution on the life of the Company will be held in 2013.

The consolidated financial statements for the year ended 30 June 2012 were approved for issue by the Board of Directors on 22 October 2012.

2.  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The principal accounting policies applied in the preparation of these consolidated financial statements are set out below. These policies have been consistently applied to all the years presented.

2.1 Basis of preparation

The consolidated financial statements of VinaCapital Vietnam Opportunity Fund Limited have been prepared in accordance with International Financial Reporting Standards ("IFRS") as issued by the International Accounting Standards Board ("IASB"). The consolidated financial statements have been prepared using the historical cost convention, as modified by the revaluation of investment property, available for sale financial assets, leasehold land, financial assets at fair value through profit or loss and financial liabilities at fair value through profit or loss.  The financial statements have been prepared on a going concern basis subject to further shareholders' decision on business development.

The preparation of financial statements in conformity with IFRS requires the use of certain critical accounting estimates. It also requires management to exercise its judgement in the process of applying the Group's accounting policies. The areas involving a higher degree of judgement or complexity, or areas where assumptions and estimates are significant to the consolidated financial statements are disclosed in Note 3.

2.2 Changes in accounting policy and disclosures

(a) New and amended standards adopted by the Group

There are no new IFRS or International Financial Reporting Interpretations Committee ("IFRIC") interpretations that are effective for the first time for the financial year beginning on or after 1 January 2011 that would be expected to have a material impact on the Group.

(b) New standards, amendments and interpretations issued but not effective for the financial year beginning on or after 1 January 2011 and not early adopted

At the date of authorisation of these consolidated financial statements, certain new standards, amendments and interpretations to existing standards have been published but are not yet effective, and have not been early adopted by the Group.

The Board anticipates that all such pronouncements will be adopted in the Group's accounting policies for the first period beginning after the effective dates of these pronouncements. Information on new standards, amendments and interpretations that are expected to be relevant to the Group's consolidated financial statements is provided below. Certain other new standards and interpretations have been issued but are not expected to have a material impact on the Group's consolidated financial statements.

IFRS 9 (2010) Financial Instruments - Classification and Measurement is effective from 1 January 2013.  There are significant changes to existing guidance in IAS 39, including the multiple classification and measurement models in IAS 39 being replaced with a single model that has only two classification categories: amortised cost and fair value.  Classification under IFRS 9 is driven by the entity's business model for managing the financial assets and the contractual characteristics of the financial assets.  Adoption of IFRS 9 will result in changes to the presentation and disclosure of financial assets in the financial statements of the Company, but will not impact on the recognition and measurement of the financial assets. 

IFRS 10, "Consolidated financial statements" is effective from 1 January 2013. The standard builds on existing principles by identifying the concept of control as the determining factor in whether an entity should be included within the consolidated financial statements of the parent company. The standard provides additional guidance to assist in the determination of control where this is difficult to assess.

IFRS 12, "Disclosures of interests in other entities" is effective from 1 January 2013. It includes the disclosure requirements for all forms of interests in other entities, including joint arrangements, associates, special purpose vehicles and other off balance sheet vehicles. The impact on adoption is on disclosure in the financial statements.

IFRS 13, "Fair value measurement" is effective from 1 January 2013. The standard aims to improve consistency and reduce complexity by providing a precise definition of fair value and a single source of fair value measurement and disclosure requirements for use across IFRS. The requirements do not extend the use of fair value accounting but provide guidance on how it should be applied where its use is already required within IFRS. The Group will assess IFRS13's full impact on the financial statements before the year of adoption of the standard.

Amendments to IAS 1 Presentation of Financial Statements are effective from 1 July 2012. The amendments require an entity to group items presented in other comprehensive income into those that, in accordance with other IFRS: (a) will not be reclassified subsequently to profit or loss and (b) will be reclassified subsequently to profit or loss when specific conditions are met. The board expects this will change the current presentation of items in other comprehensive income but will not affect the measurement of recognition of such items.

There are no other IFRS or IFRIC interpretations that are not yet effective that would be expected to have a material impact on the Group.

2.3 Consolidation

(a) Subsidiaries

Subsidiaries are all entities over which the Group has the power to govern the financial and operating policies generally accompanying a shareholding of more than one half of the voting rights. The existence and effect of potential voting rights that are currently exercisable or convertible are considered when assessing whether the Group controls another entity, along with contractual arrangements, are taken into consolidation. Subsidiaries are fully consolidated from the date on which control is transferred to the Group. They are excluded from consolidation from the date that the control ceases. The majority of the Group's subsidiaries have a reporting date of 30 June. For subsidiaries with a different reporting date, the Group consolidates management information up to 30 June.

The Group applies the acquisition method to account for business combinations. The consideration transferred for the acquisition of a subsidiary is the fair values of the assets transferred, the liabilities incurred to the former owners of the acquiree and the equity interests issued by the Group. The consideration transferred includes the fair value of any asset or liability resulting from a contingent consideration arrangement. Identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination are measured initially at their fair values at the acquisition date. The Group recognises any non-controlling interest in the acquiree on an acquisition-by-acquisition basis, either at fair value or at the non-controlling interest's proportionate share of the recognised amounts of acquiree's identifiable net assets.

Acquisition-related costs are expensed as incurred.

If the business combination is achieved in stages, the acquisition date fair value of the acquirer's previously held equity interest in the acquiree is remeasured to fair value at the acquisition date through profit or loss.

Any contingent consideration to be transferred by the Group is recognised at fair value at the acquisition date. Subsequent changes to the fair value of the contingent consideration that is deemed to be an asset or liability is recognised in accordance with IAS 39 either in profit or loss or as a change to other comprehensive income. Contingent consideration that is classified as equity is not remeasured, and its subsequent settlement is accounted for within equity.

Goodwill is initially measured as the excess of the aggregate of the consideration transferred and the fair value of non-controlling interest over the net identifiable assets acquired and liabilities assumed. If this consideration is lower than the fair value of the net assets of the subsidiary acquired, the difference is recognised in profit or loss.

Inter-company transactions, balances, income and expenses on transactions between group companies are eliminated. Profits and losses resulting from inter-company transactions that are recognised in assets are also eliminated. Accounting policies of subsidiaries have been changed where necessary to ensure consistency with the policies adopted by the Group.

(b) Associates

Associates are all entities over which the Group has significant influence but not control, generally accompanying a shareholding of between 20% and 50% of the voting rights. Investments in associates are accounted for using the equity method of accounting. Under the equity method, the investment is initially recognised at cost, and the carrying amount is increased or decreased to recognise the investor's share of the profit or loss of the investee after the date of acquisition. The Group's interest in associates includes goodwill identified on acquisition and long-term loans to associates which in substance form part of the Group's interest in the associate.

If the ownership interest in an associate is reduced but significant influence is retained, only a proportionate share of the amounts previously recognised in other comprehensive income is reclassified to profit or loss where appropriate.

The Group's share of post-acquisition profit or loss is recognised in the income statement, and its share of post-acquisition movements in other comprehensive income is recognised in other comprehensive income with a corresponding adjustment to the carrying amount of the investment. When the Group's share of losses in an associate equals or exceeds its interest in the associate, including any other unsecured receivables, the Group does not recognise further losses, unless it has incurred legal or constructive obligations or made payments on behalf of
the associate.

The Group determines at each reporting date whether there is any objective evidence that the interest in the associate is impaired. If this is the case, the Group calculates the amount of impairment as the difference between the recoverable amount of the associate and its carrying value and recognises the amount adjacent to 'share of profit/(loss) of associates' in the income statement.

Profits and losses resulting from upstream and downstream transactions between the Group and its associate are recognised in the Group's financial statements only to the extent of unrelated investor's interests in the associates. Unrealised losses are eliminated unless the transaction provides evidence of an impairment of the asset transferred. Accounting policies of associates have been changed where necessary to ensure consistency with the policies adopted by the Group.

Dilution gains and losses arising in investments in associates are recognised in the income statement.

2.4 Foreign currency translation

(a) Functional and presentation currency

The Group's consolidated financial statements are presented in United States Dollars (USD) ("the presentationcurrency"). The financial statements of each consolidated entity are initially prepared in the currency of the primary economic environment in which the entity operates ("the functional currency"), which for most investments is the Vietnamese Dong. The financial statements prepared using the Vietnamese Dong are then translated into the presentation currency. USD is used as the presentation currency because it is the primary basis for the measurement of the performance of the Group.

(b) Transactions and balances

Foreign currency transactions are translated into the functional currency using the exchange rates prevailing at the dates of the transactions or valuation where items are re-measured. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation at year-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in the income statement.

Non-monetary items measured at historical cost are translated using the exchange rates at the date of the transaction. Non-monetary items measured at fair value are translated using the exchange rates at the date when fair value was determined.

Translation differences on non-monetary financial assets and liabilities such as equities held at fair value through profit or loss are recognised in profit or loss as part of the fair value gain or loss. Translation differences on non-monetary financial assets, such as equities classified as available for sale, are included in other comprehensive income.

(c)Group companies

The results and financial position of all the Group entities (none of which has the currency of a hyper-inflationary economy) that have a functional currency different from the presentation currency are translated into the presentation currency as follows:

(i) assets and liabilities for each balance sheet presented are translated at the closing rate at the date of that balance sheet;

(ii) income and expenses for each income statement are translated at average exchange rates (unless this average is not a reasonable approximation of the cumulative effect of the rates prevailing on the transaction dates, in which case income and expenses are translated at the rate on the dates of the transactions); and

(iii) all resulting exchange differences are recognised in other comprehensive income.

Goodwill and fair value adjustments arising on the acquisition of a foreign entity are treated as assets and liabilities of the foreign entity and translated at the closing rate. Exchange differences arising are recognised in equity.

2.5 Investment property

Investment properties are properties owned or held under finance leases to earn rentals or capital appreciation, or both, or land held for a currently undetermined use. Property held under operating leases (including leasehold land) that would otherwise meet the definition of investment property is classified as investment property on a property by property basis. If a leased property does not meet this definition it is recorded as an operating lease.

Property under construction or development for future use as investment property is treated as investment property and is measured at fair value where the fair value of the investment property under construction or development for future use can be reliably determined.

2.6 Operating leases

Leases which do not transfer substantially all the risks and rewards of ownership to the Group are classified as operating leases, unless they are treated as investment properties (see accounting policy 2.5). Where the Group has the use of an asset held under an operating lease, payments made under the lease are charged to the consolidated income statement on a straight line basis over the term of the lease. Prepayments for operating leases represent property held under operating leases where a portion, or all, of the lease payments have been paid in advance, and the properties cannot be classified as an investment property.

2.7 Non-current assets (or disposal groups) and liabilities held for sale

Non-current assets (or disposal groups) are classified as assets held for sale when their carrying amount is to be recovered principally through a sale transaction and a sale is considered highly probable at the reporting date. The assets are classified as "asset held for sale" and presented separately in the consolidated balance sheet. They are measured at the lower of their carrying amounts immediately prior to their classification as held for sale and their fair values less costs to sell.

2.8 Financial assets

2.8.1 Classification

The Group classifies its financial assets in the following categories: at fair value through profit or loss, loans and receivables, and available for sale. The classification depends on the purpose for which the financial assets were acquired. Management determines the classification of its financial assets at initial recognition. 

(a) Financial assets at fair value through profit or loss

Financial assets at fair value through profit or loss include financial assets that are either classified as held for trading or designated by the management to be carried at fair value through profit or loss at inception. Financial assets at fair value through profit or loss held by the Group include listed and unlisted securities, bonds. Derivatives are also categorised as held for trading unless they are designated as hedges. Assets in this category are classified as current assets if expected to be settled within 12 months; otherwise, they are classified as non-current.

(b) Loans and receivables

Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market. They are included in current assets, except for maturities greater than 12 months after the end of the reporting period. These are classified as non-current assets. The Group's loans and receivables comprise "Trade receivables" and "Cash and cash equivalents" in the consolidated balance sheet (Notes 2.13 and 2.14)

(c) Available-for-sale financial assets

Available-for-sale financial assets are non-derivatives that are either designated in this category or not classified in any of the other categories. They are included in non-current assets unless the investment matures or management intends to dispose of it within 12 months of the end of the reporting period. The Group's available-for-sale financial assets are investments in private entities.

2.8.2 Recognition and measurement

Purchases or sales of financial assets are recognised on the date on which the Group commits to purchase or sell the asset.

Investments are initially recognised at fair value plus transaction costs for all financial assets not carried at fair value through profit or loss. Financial assets carried at fair value through profit or loss are initially recognised at fair value, and transaction costs are expensed in the income statement. Financial assets are derecognised when the rights to receive cash flows from the investments have expired or have been transferred and the Group has transferred substantially all risks and rewards of ownership. Available-for-sale financial assets and financial assets at fair value through profit or loss are subsequently carried at fair value. Loans and receivables are subsequently carried at amortised cost using the effective interest method.

If the investments do not have a quoted market price in an active market and whose fair value cannot be reliably measured, such investments shall be measured at cost, less provision for impairment.

Gains or losses arising from changes in the fair value of the 'financial assets at fair value through profit or loss' category are presented in the income statement within' fair value gain/(loss)of financial assets at fair value through profit or loss" in the period in which they arise. Dividend income from financial assets at fair value through profit or loss is recognised in the income statement when the Group's right to receive payments is established.

Changes in the fair value of monetary and non-monetary securities classified as available-for-sale are recognised in other comprehensive income.

When securities classified as available for sale are sold or impaired, the accumulated fair value adjustments recognised in equity are included in the income statement as 'gains and losses from investment securities'.

Interest on available-for-sale securities calculated using the effective interest method is recognised in the income statement as part of other income. Dividends on available-for-sale equity instruments are recognised in the income statement as part of other income when the Group's right to receive payments is established.

2.9 Offsetting financial instruments

Financial assets and liabilities are offset and the net amount reported in the balance sheet when there is a legally enforceable right to offset the recognised amounts and there is an intention to settle on a net basis or realise the asset and settle the liability simultaneously.

2.10 Prepayments for acquisition of investments

These represent prepayments made by the Group to investment/property vendors for land compensation and other related costs, and professional fees directly attributed to the projects, where the final transfer of the investment/property is pending the approval of the relevant authorities and/or is subject to either the Group or the vendor completing certain performance conditions set out in agreements. Such prepayments are measured initially at cost until such time as the approval is obtained or conditions are met, at which point they are transferred to appropriate investment accounts.

2.11 Impairment of assets

(a) Impairment of non-financial assets

Assets that have an indefinite useful life, for example, prepayment for acquisition of investment, are not subject to amortisation and are tested annually for impairment. Assets that are subject to amortisation are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. An impairment loss is recognised for the amount by which the asset's carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset's fair value less costs to sell and value in use. For the purposes of assessing impairment, assets are grouped at the lowest levels for which there are separately identifiable cash flows (cash-generating units). Non-financial assets other than goodwill that suffered an impairment are reviewed for possible reversal of the impairment at each reporting date.

(b) Impairment of financial assets

Assets carried at amortised cost

The Group assesses at the end of each reporting period whether there is objective evidence that a financial asset or group of financial assets is impaired. A financial asset or a group of financial assets is impaired and impairment losses are incurred only if there is objective evidence of impairment as a result of one or more events that occurred after the initial recognition of the asset (a 'loss event') and that loss event (or events) has an impact on the estimated future cash flows of the financial asset or group of financial assets that can be reliably estimated.

Evidence of impairment may include indications that the debtors or a group of debtors is experiencing significant financial difficulty, default or delinquency in interest or principal payments, the probability that they will enter bankruptcy or other financial reorganisation, and where observable data indicate that there is a measurable decrease in the estimated future cash flows, such as changes in arrears or economic conditions that correlate with defaults.

For loans and receivables category, the amount of the loss is measured as the difference between the asset's carrying amount and the present value of estimated future cash flows (excluding future credit losses that have not been incurred) discounted at the financial asset's original effective interest rate. The carrying amount of the asset is reduced and the amount of the loss is recognised in the consolidated income statement. If a loan or held-to-maturity investment has a variable interest rate, the discount rate for measuring any impairment loss is the current effective interest rate determined under the contract. As a practical expedient, the Group may measure impairment on the basis of an instrument's fair value using an observable market price.

If, in a subsequent period, the amount of the impairment loss decreases and the decrease can be related objectively to an event occurring after the impairment was recognised (such as an improvement in the debtor's credit rating), the reversal of the previously recognised impairment loss is recognised in the consolidated income statement.

Assets classified as available for sale

The Group assesses at the end of each reporting period whether there is objective evidence that a financial asset or a group of financial assets is impaired. For debt securities, the Group uses the criteria referred to in (a) above. In the case of equity investments classified as available for sale, a significant or prolonged decline in the fair value of the security below its cost is also evidence that the assets are impaired. If any such evidence exists for available-for-sale financial assets, the cumulative loss - measured as the difference between the acquisition cost and the current fair value, less any impairment loss on that financial asset previously recognised in profit or loss - is removed from equity and recognised in profit or loss. Impairment losses recognised in the consolidated income statement on equity instruments are not reversed through the consolidated income statement. If, in a subsequent period, the fair value of a debt instrument classified as available for sale increases and the increase can be objectively related to an event occurring after the impairment loss was recognised in profit or loss, the impairment loss is reversed through the consolidated income statement.

2.12 Inventories

Inventories are stated at the lower of cost and net realisable value. Cost is determined using the weighted average method. The cost of finished goods includes all expenses directly attributable to the manufacturing process as well as suitable portions of related pro-duction overheads, based on normal operating capacity. It excludes borrowing costs. Net realisable value is the estimated selling price in the ordinary course of business, less applicable variable selling expenses.

2.13 Trade receivables

Trade receivables are amounts due from customers for merchandise sold or services performed in the ordinary course of business.

Trade receivables are recognised initially at fair value and subsequently measured at amortised cost using the effective interest method, less provision for impairment.

2.14 Cash and cash equivalents

In the consolidated statement of cash flows, cash and cash equivalents includes cash in hand, deposits held at call with banks, other short-term highly liquid investments with original maturities of three months or less and bank overdrafts. In the consolidated balance sheet, bank overdrafts are shown within borrowings in current liabilities.

2.15 Share capital

Ordinary shares are classified as equity. Share capital is determined using the nominal value of shares that have been issued. Additional paid-in capital includes any premiums received on the initial issuance of the share capital. Incremental costs directly attributable to the issue of new ordinary shares or options are shown in equity as a deduction, net of tax, from the proceeds.

Any transaction costs associated with the issuing of shares are deducted from additional paid-in capital, net of any related income tax benefits.

2.16 Treasury shares

Where any group company purchases the Company's equity share capital (treasury shares), the consideration paid, including any directly attributable incremental costs (net of income taxes) is deducted from equity attributable to the Company's equity holders until the shares are cancelled or reissued.

Repurchased shares are classified as treasury shares and are presented as a deduction from total equity. When such treasury shares are sold or reissued subsequently, the amount received is recognised as an increase in equity, and the resulting surplus or deficit on the transaction is transferred to/from retained earnings.

2.17 Revaluation reserve

The revaluation reserve arises from the revaluation of buildings and leasehold land improvements including hotels and golf courses held by associates. The revaluation policy is consistent with the fair value policy as described in Note 3. Increases in the carrying amount arising on revaluation are credited to other comprehensive income and shown as revaluation reserve in shareholders' equity. Decreases that offset previous increases of the same asset are charged in other comprehensive income and debited against revaluation reserve directly in equity; all other decreases are charged to the income statement.

2.18 Trade payables

Trade payables are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers.

Trade payables are recognised initially at fair value and subsequently measured at amortised cost using the effective interest method.

2.19 Current and deferred income tax

(a) Corporate income tax

The tax expense for the period comprises current and deferred tax. Tax is recognised in the income statement, except to the extent that it relates to items recognised in other comprehensive income or directly in equity.  In this case, the tax is also recognised in other comprehensive income or directly in equity, respectively.

Gains and losses from changes in fair value of properties of the associates are accounted for using the equity method of accounting.

Current income tax assets and/or liabilities comprise those obligations to, or claims from, authorities relating to the current or prior reporting periods that are unpaid at the reporting date. They are calculated according to the tax rates and tax laws applicable to the fiscal periods to which they relate based on the taxable profit for the year. All changes to current tax assets or liabilities are recognised as a component of tax expense in the consolidated income statement.

Deferred income taxes are calculated using the liability method on temporary differences. This involves the comparison of the carrying amounts of assets and liabilities in the consolidated financial statements with their respective tax bases. In addition, tax losses available to be carried forward as well as other income tax credits to the Group are assessed for recognition as deferred tax assets.

However, deferred tax is not provided on the initial recognition of goodwill, or on the initial recognition of an asset or liability unless the related transaction is business combination or affects tax or accounting profit. Deferred tax on temporary differences associated with shares in subsidiaries and associates is not provided if reversal of these temporary differences can be controlled by the Group and it is probable that reversal will not occur in the foreseeable future.

Deferred tax liabilities are always provided for in full. Deferred tax assets are recognised to the extent that it is probable that they will be able to be offset against future taxable income.

Deferred tax assets and liabilities are calculated, without discounting, at tax rates that are expected to apply to their respective period of realisation, provided they are enacted or substantively enacted at the reporting date. Most changes in deferred tax assets or liabilities are recognised as a component of tax expense in the consolidated income statement. Only changes in deferred tax assets or liabilities that relate to a change in value of assets or liabilities that is charged directly to other comprehensive income are charged or credited directly to other comprehensive income.

(b) Withholding taxes imposed on investment income

The Group currently incurs withholding taxes imposed by local jurisdictions on investment income. Such income is recorded gross of withholding taxes in the consolidated income statement.

2.20 Provisions

Provisions are recognised when the Group has a present legal or constructive obligation as a result of past events; it is probable that an outflow of resources will be required to settle the obligation; and the amount has been reliably estimated. Provisions are not recognised for future operating losses.

Provisions are measured at the estimated expenditure required to settle the present obligation, based on the most reliable evidence available at the reporting date, including the risks and uncertainties associated with the present obligation and there is uncertainty about the timing or amount of the future expenditure require in settlement. Where there are a num-ber of similar obligations, the likelihood that an outflow will be required in settlement is determined by considering the class of obligations as a whole. Long-term pro-vi-sions are discounted to their present values, where the time value of money is material.

All provisions are reviewed at each reporting date and adjusted to reflect the current best estimate of the Group's management.

2.21      Revenue recognition

Revenue is measured at the fair value of the consideration received or receivable, and represents amounts receivable for goods supplied, stated net of discounts, returns and value added taxes. The Group recognises revenue when the amount of revenue can be reliably measured; when it is probable that future economic benefits will flow to the entity; and when specific criteria have been met for each of the Group's activities, as described below.

(a) Sale of goods

Revenue from sale of goods is recognised in the consolidated income statement when the significant risks and rewards of ownership of goods have passed to the buyer. Revenue is measured by referenceto the fair value of consideration received or receivable by the Group for goods supplied, excluding sales taxes, rebates, and trade discounts.

(b) Interest income

Interest income is recognised using the effective interest method. When a loan receivable is impaired, the Group reduces the carrying amount to its recoverable amount, being the estimated future cash flow discounted at the original effective interest rate of the instrument, and continues unwinding the discount as interest income. Interest income on impaired loan receivables is recognised using the original effective interest rate.

(c) Dividend income

Dividend income, other than those from investments in associates, is recognised when the right to receive payment is established as disclosed in Note 2.8.2.

2.22 Related parties

Parties are considered to be related if one party has the ability to control the other party or exercise significant influence over the other party in making financial or operational decisions. Enterprises and individuals that directly, or indirectly through one or more intermediary, control, or are controlled by, or under common control with, the Company, including, subsidiaries and fellow subsidiaries are related parties of the Company. Associates and individuals owing directly, or indirectly, an interest in the voting power of the Company that give them significant influence over the entity, key management personnel, including directors and officers of the Company, the investment manager and the close members of the family. In consider each possible related party relationship, attention is directed to the substance of the relationship, and not merely the legal form.

3.  CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS

When preparing the consolidated financial statements, the Group undertakes a number of accounting judgements, estimates and assumptions about recognition and measurement of assets, liabilities, income and expenses. The actual results may differ from the judgements, estimates and assumptions made by management, and may not equal the estimated results. Information about significant judgements, estimates and assumptions that have the most significant effect on recognition and measurement of assets, liabilities, income and expenses are discussed below.

3.1 Critical accounting estimates and assumptions

Fair value of properties within the associates and the Group

Properties within the associates and the Group are stated at fair value. Two independent valuation firms with appropriately recognised professional qualifications and recent experience in the location and category being valued undertake a valuation of every property each year on the same valuation date. The fair value is estimated by the independent valuation firms, including: CB Richard Ellis, Savills, Jones Lang LaSalle, Colliers and HVS, assuming there is an agreement between a willing buyer and a willing seller in an arm's length transaction after proper marketing; wherein the parties have each acted knowledgeably, prudently and without compulsion.

These valuations are based on certain assumptions, which are subject to uncertainty and might materially differ from the actual results. The valuations by the independent valuation firms are prepared based upon direct comparison with sales of other similar properties in the area and the expected future discounted cash flows of a property using a yield that reflects the risks inherent therein. The estimated fair values provided by the independent valuation firms are used by the valuation committee as the primary basis for estimating each property's fair value.  In addition to the reports of the independent valuation firms, the valuation committee considers information from other sources, including those sources as below, before recommending each property's estimated fair value to the board for approval.

a) current prices in an active market for properties of different nature, condition or location (or subject to different lease or other contracts), adjusted to reflect those differences;

b) recent prices of similar properties in less active markets, with adjustments to reflect any changes in economic conditions since the date of the transactions that occurred at those prices;

c) recent developments and changes in laws and regulations that might affect zoning and/or the Group's ability to exercise its rights in respect to properties and therefore fully realise the estimated values of such properties; and

d) discounted cash flow projections based on reliable estimates of future cash flows, derived from the terms of external evidence such as current market rents and sales prices for similar properties in the same location and condition, and using discount rates that reflect current market assessments of the uncertainty in the amount and timing of the cash flows.

Discount rates ranging from 14% to 22% (30 June 2011: 14% to 19%) are considered appropriate for properties in different locations. Gains and losses from changes in fair value of properties of the Group are recognised in the consolidated income statement. Gains and losses from changes in fair value of properties of the associates are accounted for using the equity method of accounting.

Fair value of financial assets

Listed securities are quoted at the bid price at each reporting date. For unlisted securities which are traded in an active market, the fair value is the average quoted bid price obtained from a minimum sample of three reputable securities companies at the reporting date.

The fair value of financial assets that are not traded in an active market (for example, unlisted securities where market prices are not readily available) is determined by using valuation techniques. The Group uses its judgement to select a variety of methods and make assumptions that are mainly based on market conditions existing at each reporting date. Independent valuations are also obtained from appropriately qualified independent valuation firms to evaluate and adjust valuations. The outcomes may vary from the actual prices that would be achieved in an arm's length transaction at the reporting date (see Note 31(e)).

3.2 Critical judgement in applying the Group's accounting policies

Equity investments

When the Group has interest in the voting power of the investee of between 20% and 50%, significant influence over the investee is presumed. There are situations, however, where it can be clearly demonstrated that interest held by the Group is less than 20%, but significant influence exists; and interest held of more than 20% but there is no significant influence. In exercising its judgement, management considers one or more of the following as to whether the Group has significant influence over the investee. The criteria are whether the Group:

a) has representation on the Board of Directors of the investee;

b) participates in policy-making processes, including decisions about dividends or other distributions;

c) has interchange of managerial personnel; or

d) provides essential technical information.

At the reporting date, the Group has interests in certain investees with more than 20% voting power but which are not accounted for as associates (Note 12), and certain investees with less than 20% voting power, but are accounted for as associates of the Group (Note 6).

4.  SEGMENT ANALYSIS

In identifying its operating segments, management generally follows the Group's sectors of investment which are based on internal management reporting information for the investment manager's management, monitoring of investments and decision making. The operating segments by investment portfolio include capital markets, real estate (real estate and hospitality), private equity and cash (including cash and cash equivalents, bonds, and short-term deposits) sectors.

Each of the operating segments is managed and monitored individually by the investment manager as each requires different resources and approaches. The investment manager assesses segment profit or loss using a measure of operating profit or loss from the investment assets. Although IFRS 8 requires measurement of segmental profit or loss the majority of expenses are common to all segments therefore cannot be individually allocated. There have been no changes from prior periods in the measurement methods used to determine reported segment profit or loss.

Segment information can be analysed as follows:

Revenue and other segment profit and loss

	Capital markets	Real estate	Private equity	Cash	Total
	USD'000	USD'000	USD'000	USD'000	USD'000
Year ended 30 June 2012
Revenue	-	-	8,913	-	8,913
Dividend income	20,710	-	-	-	20,710
Interest income		-	-	3,413	3,413
Share of losses of associates	-	(16,347)	-	-	(16,347)
Other income	-	12,301	11,264	-	23,565
Fair value loss of investment property	-	(1,660)	-	-	(1,660)
Net changes in fair value of financial assets at fair value through profit or loss:
- Listed and unlisted securities	27,011	-	-	-	27,011
- Corporate bonds	480	-	-	-	480
	────── 48,201 ══════	────── (5,706)     ══════	────── 20,177 ══════	───── 3,413 ═════	────── 66,085 ══════
Year ended 30 June 2011
Revenue	-	-	8,797	-	8,797
Dividend income	16,725	-	-	-	16,725
Interest income	-	157	510	4,069	4,736
Share of profits of associates	-	15,413	11	-	15,424
Other income	-	5,876	1,070	-	6,946
Fair value loss of investment property	-	(301)	-	-	(301)
Net changes in fair value of financial assets at fair value through profit or loss:
- Listed and unlisted securities	(52,575)	-	-	-	(52,575)
- Corporate bonds	55	-	-	-	55
	────── (35,795) ══════	────── 21,145 ══════	────── 10,388 ══════	───── 4,069 ═════	───── (193) ═════

Assets

	Capital markets	Real estate	Private equity	Cash	Total
	USD'000	USD'000	USD'000	USD'000	USD'000
As at 30 June 2012
Financial assets at fair value through profit or loss	394,369	-	5,000	25,912	425,281
Investment property	-	1,785	-	-	1,785
Interest in associates	-	193,611	5,526	-	199,137
Prepayment for acquisition of investment property	-	7,500	-	-	7,500
Available-for-sale financial assets:
- Non current	-	6,111		-	6,111
- Current	-	-	28,450	-	28,450
Other non-current assets	-	-	1,383	-	1,383
Cash and cash equivalents	-	-	-	42,209	42,209
Inventories	-	-	6,090	-	6,090
Other current assets	3,412	15,527	6,443	-	25,382
Assets classified as held for sale	-	27,227	4,900	-	32,127
	──────	──────	─────	─────	──────
	397,781	251,761	57,792	68,121	775,455
	══════	══════	═════	═════	══════

As at 30 June 2011
Financial assets at fair value through profit or loss	367,401	-	5,000	11,381	383,782
Investment property	-	3,445	-	-	3,445
Interest in associates	-	243,797	3,773	-	247,570
Long term loan receivable from related party	-	7,115	-	-	7,115
Prepayment for acquisition of investment property	-	8,986	-	-	8,986
Available-for-sale financial assets	-	6,111	10,812	-	16,923
Other non-current assets	-	-	667	-	667
Cash and cash equivalents	-	-	-	62,968	62,968
Inventories	-	-	2,380	-	2,380
Other current assets	2,680	15,426	285	27	18,418
Assets classified as held for sale	-	245	12,104	-	12,349
	────── 370,081 ══════	────── 285,125 ══════	───── 35,021 ═════	───── 74,376 ═════	────── 764,603 ══════

5.  INVESTMENT PROPERTY

	30 June 2012	30 June 2011
	USD'000	USD'000
Opening balance	3,445	6,700
Reclassified to assets held for sale (Note 14)	-	(245)
Net loss from fair value changes	(1,660)	(301)
Disposed during the year	-	(2,344)
Translation difference	-	(365)
Closing balance	───── 1,785 ═════	───── 3,445  ═════

6.  INTERESTS IN ASSOCIATES

	30 June 2012			30 June 2011
	USD'000			USD'000
Investments in associates	172,341			199,579
Long-term loan receivables (Note 29(e))	35,733			47,991
Interests in associates	────── 208,074			────── 247,570
Less: provision for impairment	(8,937)			-
Total	────── 199,137 ══════			────── 247,570 ══════
The movement in investments in associates is analysed as follows:
Opening balance		199,579		194,688
Additions		22,107		7,038
Share of (losses)/profits, net of tax		(16,347)		15,424
Share of change in revaluation reserve		(112)		6,320
Reclassified to asset held for sale (Note 14)		(24,700)		(12,104)
Loan converted to shares, reclassified from loans to related   parties (Note 29(e))		12,550		-
Transferred from/(to) available-for-sale financial assets (Note 8)		8,165		(2,895)
Transferred to financial assets at fair value through profit or loss		-		(1,912)
Dividends received		(4,000)		(1,500)
Disposals		(13,041)		(5,125)
Share of translation differences(*)		(11,860)		(355)
Closing balance		────── 172,341 ══════		────── 199,579   ══════

The Group's share of the results of its significant associates, its aggregated assets (including goodwill) and liabilities at 30 June 2012 and their performance during the year was as follows:

		As at 30 June			For 30 June 2012
		2012	2011
Name	Country of incorporation	% of group interest	% of group interest	Assets USD'000		Liabilities USD'000	Revenue USD'000	Profit/ (loss) USD'000
S.E.M Thong Nhat Hotel Metropole	Vietnam	50.00	50.00	45,374		9,224	17,629	3,919
Hung Vuong Corporation	Vietnam	40.91	40.91	37,393		21,639	8,249	1,128
VinaCapital Danang Golf Course Ltd.	Vietnam	25.00	25.00	97,542		25,783	5,463	(10,594)
Prosper Big Ltd.	BVI	25.00	25.00	162,166		144,152	-	(14,617)
VinaCapital Danang Resorts Ltd.	Vietnam	25.00	25.00	93,458		31,770	32,013	(1,146)
Vinh Thai Co. Ltd.	Vietnam	25.00	25.00	67,369		36,342	-	(24,561)
Vina Alliance Limited (*)	Vietnam	15.50	15.50	117,006		30,185	-	(32,332)
Saigon Golf JSC	Vietnam	20.00	20.00	11,865		3,232	-	(212)
Vina Dai Phuoc Corporation (*)	Vietnam	18.00	18.00	103,746		41,573	-	(12,858)
Phu Hoi City Company Limited (*)	Vietnam	17.50	17.50	31,224		15	-	(6,928)
Kotobuki Holding (Hongkong) Ltd	Vietnam	38.00 ════	9.50 ════	51,546 ═════		3,617 ═════	10,748 ═════	1,824 ═════

(*) Although the Group holds less than 20% of equity shares in Vina Alliance Limited, Vina Dai Phuoc Corporation and Phu Hoi City Company Limited, the Group exercises significant influence by having the power to participate in the financial and operating policies decisions of these entities and therefore these investments are treated as associates of the Group.

The Group has discontinued the recognition of its shares of losses of those which have been written down to zero and the Group has no continuing obligation to the associates. The amount of unrecognised share of losses for the year ended 30 June 2012 and cumulatively is USD2.5 million and USD3.0 million (year ended 30 June 2011 and cumulatively: nil and USD0.5 million) respectively.

Acquisition of additional interest in Kotobuki Holding (Hong Kong) Limited

During the year, the Group acquired the remaining 75% interest in Clear Interest Group Limited which owns 38% equity interest of Kotobuki Holding (Hong Kong) Limited. This company owns and manages the Legend Hotel, a five-star hotel located in District 1, Ho Chi Minh City, and an adjoining office building. The total cost of the acquisition was USD22.0 million, which was settled in cash and brings the Group's total interest in the project to 38% following the acquisition.

Subsequent to the acquisition of the additional interest in the associate, the Group has received an offer to sell its interest in the associate to a third party. At the reporting date, the Group is in negotiation with the third party and based on its commitment, has reclassified its interest in Kotobuki Holding (Hong Kong) Limited as an asset held for sale (Note 14).

7.  PREPAYMENT FOR ACQUISITION OF INVESTMENT PROPERTY

	30 June 2012	30 June 2011
	USD'000	USD'000
Opening balance	8,986	10,491
Disposal	-	(1,505)
	────	─────
	8,986	8,986
Less: Provision for impairment loss	(1,486)	-
	────	─────
Closing balance	7,500	8,986
	════	═════

The prepayment relates to payments made by the Group to property vendors where the final transfer of the property is pending the approval of the relevant authorities as at the balance sheet date.

8.  AVAILABLE-FOR-SALE FINANCIAL ASSETS

	30 June 2012	30 June 2011
	USD'000	USD'000
Opening balance	16,923	6,916
Additions	2,223	7,112
Reclassified (to)/from interest in associates (Note 6)	(8,165)	2,895
Reversal of impairment loss (see below)	9,400	-
Fair value gain recognised in reserve	14,180	-
Closing balance	───── 34,561 ─────	───── 16,923 ─────
Less: current portion	(28,450)	-
	─────	─────
Non-current portion	6,111	16,923
	═════	═════
Available-for-sale financial assets	34,760	26,522
Less: Cumulative provision for impairment losses	(199)	(9,599)
Total	───── 34,561 ═════	───── 16,923 ═════

The movement of provision for impairment losses is analysed as follows:

	30 June 2012	30 June 2011
	USD'000	USD'000
Opening balance	9,599	9,599
Reversal of impairment loss (Note 23)	(9,400)	-
Closing balance	──── 199 ════	──── 9,599 ════

The reversal of impairment loss of USD9.4 million is in respect to one of the Group's private equity holdings. The investment will be disposed within 12 months and the financial asset has been classified as current at the reporting date. The fair value of the investment has increased based on the divestment price.

No fair value adjustments to available-for-sale financial assets were recognised in the prior year. The impairment losses on these investments were recognised in the income statement as losses from investment securities.

The Group has determined whether the investments are impaired based on discounted cash flows method using a rate based on market interest and the risk premium specific to the unlisted securities (2012: 12%, 2011: 14%).

9.  FINANCIAL INSTRUMENTS BY CATEGORY

	Loans and receivables	Financial assets at fair value through profit or loss	Available-for-sale financial assets	Total
	USD'000	USD'000	USD'000	USD'000
As at 30 June 2012
Available-for-sale financial assets	-	-	34,561	34,561
Long-term loan included in interest in associates	35,733	-	-	35,733
Long-term loan to an associate	3,845	-	-	3,845
Trade and other receivables	21,537	-	-	21,537
Financial assets at fair value through profit or loss	-	425,281	-	425,281
Cash and cash equivalents	42,209	-	-	42,209
Total	────── 103,324 ══════	────── 425,281 ══════	───── 34,561 ═════	────── 563,166 ══════
Financial assets denominated in:
- USD	10,955	23,321	29,600	63,876
- VND	92,329	401,960	4,961	499,250
- Other	40	-	-	40
	────── 103,324 ══════	────── 425,281 ══════	───── 34,561 ═════	────── 563,166 ══════

As at 30 June 2011
Available-for-sale financial assets	-	-	16,923	16,923
Long-term loan included in interest in associates	47,991	-	- -	47,991
Long-term loan to an associate	7,690	-	-	7,690
Trade and other receivables	17,843	-	-	17,843
Financial assets at fair value through profit or loss	-	383,782	-	383,782
Cash and cash equivalents	62,968	-	-	62,968
Total	───── 136,492 ═════	────── 383,782 ══════	───── 16,923 ═════	────── 537,197 ══════
Financial assets denominated in:
- USD	38,227	37,452	3,700	79,379
- VND	97,732	346,330	13,223	457,285
- Other	533	-	-	533
	───── 136,492 ═════	────── 383,782 ══════	───── 16,923 ═════	────── 537,197 ══════

All financial liabilities are classified as financial liabilities carried at amortised cost. As at the balance sheet date, the financial liabilities denominated in USD and in VND are USD1.19 million and USD8.52 million (30 June 2011: USD5.94 million and USD6.66 million), respectively.

10.  INVENTORIES

	30 June 2012	30 June 2011
	USD'000	USD'000
At cost:
Raw materials	1,487	106
Work in progress	155	181
Spares and tools	1,000	959
Goods on consignment	24	-
	─────	─────
Subtotal	2,666	1,246
At net realisable value:
Finished goods	3,424	1,134
Total	───── 6,090 ═════	───── 2,380 ═════

The cost of inventories recognised as expenses and included in costs of sales amounted to USD4.32 million (year ended 30 June 2011: USD4.48 million) during the year.

The Group reversed USD2.07 million of  previous write downs of inventory as these goods were sold during the year. The amount reversed has been included in cost of sales.

11.  TRADE AND OTHER RECEIVABLES

	30 June 2012	30 June 2011
	USD'000	USD'000
Trade receivables	1,293	969
Receivable from matured bonds	3,404	3,480
Interests receivables	1,839	728
Dividend receivables	948	1,583
Receivable from disposal of investment property	3,518	1,958
Payment on behalf of related parties (Note 29(d))	2,941	3,340
Short-term loans to third parties	-	2,985
Deposits for shares tenders	3,293	-
Other receivables	1,121	1,236
	─────	─────
	18,357	16,279
Less: Cumulative provision for impairment of receivables	(3,746)	(4,225)
	───── 14,611 ═════	───── 12,054 ═════

The movements in the cumulative provision for impairment of receivables is analysed as follows:

	30 June 2012	30 June 2011
	USD'000	USD'000
Opening balance	4,225	2,084
Provision for receivables impaired	-	2,141
Reversal of unused provision	(479)	-
Closing balance	───── 3,746 ═════	───── 4,225 ═════
Provision balance is in respect of:
- Trade receivables	342	745
- Receivable from matured bonds	3,404	3,480
	───── 3,746 ═════	───── 4,225 ═════

The creation and release of provision for impaired receivables have been included in 'other expenses' in the income statement.

The credit quality of the trade receivables as at the reporting date is as follows:

	30 June 2012	30 June 2011
	USD'000	USD'000
Current and not impaired	626	224
Past due but not impaired, less than 6 months	33	-
Past due but not impaired, more than 6 months	292	-
Past due and impaired	342	745
Total	──── 1,293 ════	──── 969 ════

The amounts past due and assessed as impaired relate sales agents which are in difficult economic situations. The amounts past due but assessed as not impaired at the balance sheet date relate to a number of customers to whom there is no recent history of default.

As at both reporting dates, there is no significant concentration of credit risk relating to any single customer.

Other than the provision for impairment of receivables disclosed above, the other classes within the trade and other receivables do not contain impairment assets.

As all trade and other receivables are short term in nature, their carrying values are considered reasonable approximation of their fair values at the reporting date.

12.  FINANCIAL ASSETS AT FAIR VALUE THROUGH PROFIT OR LOSS

	30 June 2012	30 June 2011
	USD'000	USD'000
Financial assets in Vietnam:
Ordinary shares - listed	297,074	241,521
Ordinary shares - unlisted	78,974	93,428
Corporate bonds	8,500	11,381
Government bonds	17,412	-
	──────	──────
	401,960	346,330
Financial assets in countries other than Vietnam:
Ordinary shares - listed	23,321	37,452
Total	────── 425,281 ══════	────── 383,782 ══════

Corporate bonds carry fixed interest rates ranging from 8.0% to 9.6% (30 June 2011: 8% to 15%) and will mature in December 2012. The Government bonds carry fixed interest rate of 9.8%. Government bonds have a Moody's rating of B2 in October 2012.

As at the reporting date, the Group holds more than a 20% equity interest in the following entities but which the Group determines that it has no significant influence:

	Equity interest (%) as at
	30 June 2012	30 June 2011
Listed entities:
- Transforwarding Warehousing Joint Stock Corporation (TMS)	25.7%	22.8%
- Thu Duc Water Supply Joint Stock Company (TDW)	30.0%	30.0%
	═════	═════
Unlisted entity:
- An Giang Plant Protection Joint Stock Company (AGPP)	24.7%	21.6%
	═════	═════

The details of financial assets at fair value through profit or loss by industry are as follows:

	30 June 2012	30 June 2011
	USD'000	USD'000
Consumer staples	106,559	87,835
Construction	39,559	48,614
Financial services	77,416	57,761
Rubber and fertiliser	73,502	25,898
Energy, minerals and petroleum	21,916	24,680
Pharmaceuticals	12,567	11,359
Real estate	49,589	64,537
Other securities	18,261	51,717
Bonds	25,912	11,381
Total	────── 425,281 ══════	────── 383,782 ══════

13.  CASH AND CASH EQUIVALENTS

	30 June 2012	30 June 2011
	USD'000	USD'000
Cash on hand	18	106
Cash in banks	16,277	42,706
Cash equivalents	25,914	20,156
	───── 42,209 ═════	───── 62,968 ═════

Cash equivalents represent short-term deposits with annual interest rates of 0.5% and 9.0% for USD and VND accounts (30 June 2011: 0.5% and 14.0% for USD and VND accounts), respectively. The majority of these deposits have maturity terms from one to two months from the reporting date.

As at the balance sheet date, the cash equivalents are denominated in the following currencies:

	30 June 2012	30 June 2011
	USD'000	USD'000
Short-term deposits in USD	2,140	2,100
Short-term deposits in VND	23,774	18,056
Total	───── 25,914 ═════	───── 20,156 ═════
For the purpose of the statement of cash flows, cash and cash equivalents include bank overdraft as follows:
	30 June 2012	30 June 2011
	USD'000	USD'000
Cash and cash equivalents	42,209	62,968
Bank overdraft (Note 18)	(1,175)	-
	───── 41,034 ═════	───── 62,968 ═════

14.  ASSETS CLASSIFIED AS HELD FOR SALE

	30 June 2012	30 June 2012
	USD'000	USD'000
Opening balance	12,349	-
Disposed of during the year	(7,449)	-
Reclassified from investment property (Note 5)	-	245
Reclassified from loan to a related party (Note 29(e))	2,527	-
Reclassified from interest in associates (Note 6)	24,700	12,104
	──────	──────
Closing balance	32,127	12,349
	═════	═════

15.  SHARE CAPITAL

	30 June 2012		30 June 2011
	Number of shares	USD'000	Number of shares	USD'000
Ordinary shares of USD0.01 each:
Authorised	500,000,000	5,000	500,000,000	5,000
	════════	════	════════	════
Issued and fully paid	324,610,259	3,246	324,610,259	3,246
	════════	════	════════	════

16.  TREASURY SHARES

At the Extraordinary General Meeting of shareholders on 25 October 2011, the Company's Articles of Association were modified to enable the Company to acquire its own shares. As at 30 June 2012, the Group has purchased 12,074,663 of its ordinary shares for a total cash consideration of USD17,784,729 at an average cost USD1.47 per share.

17.  REVALUATION RESERVE

	30 June 2012	30 June 2011
	USD'000	USD'000
Opening balance	27,513	21,193
Share of associates' change in revaluation reserve,   net of tax	1,089	6,320
	─────	─────
Closing balance	28,602	27,513
	═════	═════

The Group shares the revaluation gains/(losses) relating to the revaluation of associates' hospitality properties.

18.  SHORT-TERM BORROWINGS

Included in bank borrowings is a bank overdraft of USD1.2 million (30 June 2011: Nil) (Note 13).

Bank borrowings are not secured and their fair values at the reporting date are equal to the carrying amounts due to the short term.

Bank borrowings are denominated in VND and are repayable within 12 months. They are subject to interest rates ranging from 10.5% to 17.5%.

19.  TRADE AND OTHER PAYABLES

	30 June 2012	30 June 2011
	USD'000	USD'000
Trade payables	1,987	1,702
Withholding tax payable	785	769
Unearned revenue	1,616	367
Other payables	399	1,094
Total	───── 4,787 ═════	───── 3,932 ═════

All trade and other payables are short-term in nature, accordingly their carrying values are considered reasonable approximation of their fair values.

20. REVENUE AND COST OF SALES

The Group's revenue and cost of sales represent the sale of goods and cost of sales by its wholly owned subsidiary, American Home Vietnam Co., Ltd.  All revenue is derived from external customers and there was no significant concentration of sales to any single customer.

21.  INTEREST INCOME, FINANCE INCOME AND FINANCE COSTS

(a) Interest Income

	Year ended
	30 June 2012	30 June 2011
	USD'000	USD'000
Interest income comprised:
- cash and term deposits	1,661	1,704
- corporate bonds	700	938
- short-term loans to associates	595	1,298
- others	457	202
Total	───── 3,413	───── 4,142
	═════	═════

(b) Finance costs, net

	Year ended
	30 June 2012	30 June 2012
	USD'000	USD'000
Other finance income:
- realised gains on foreign currency differences	93	594
	═════	═════
Finance costs comprised:
- interest expenses	(172)	(460)
- realised loss on foreign currency differences	(871)	(3,055)
- unrealised loss on foreign currency differences	(16)	(656)
	─────	─────
	(1,059)	(4,171)
	─────	─────
Total	(966)	(3,577)
	═════	═════

22.  GAIN/(LOSS) FROM FINANCIAL ASSETS AT FAIR VALUE THROUGH PROFIT OR LOSS, NET

	Year ended
	30 June 2012	30 June 2011
	USD'000	USD'000
Financial assets at fair value through profit or loss:
-    Gain from realisation of financial assets, net	4,571	22,171
-    Unrealised gains/(losses)	22,920	(74,691)
	─────	─────
Total	27,491	(52,520)
	═════	═════

23.  OTHER INCOME

	Year ended
	30 June 2012	30 June 2011
	USD'000	USD'000
Gain on disposals of investments in:
- Associates	1,103	5,092
- Investments property	-	356
- Prepayment for acquisition of investment	-	428
- Assets classified as held for sale	7,616	-
Gain on disposal of a subsidiary	2,139	-
	─────	────
Total gain on disposals of investments	10,858	5,876
Reversal of impairment loss (Note 8)	9,400	-
Consulting income	330	443
Other income	2,977	627
	─────	────
Total	23,565	6,946
	═════	════

24.  SELLING, GENERAL AND ADMINISTRATION EXPENSES

	Year ended
	30 June 2012	30 June 2011
	USD'000	USD'000
Management fees (Note 29(a))	14,863	14,488
Professional fees	2,478	2,714
Selling, general and administration expenses (*)	1,571	1,338
Other expenses	586	1,615
Total	───── 19,498 ═════	───── 20,155 ═════

(*) The majority of these expenses relate to operating expenses incurred by subsidiaries of the Group.

An analysis of ongoing charges is provided in Note 27.

25.  INCOME TAX EXPENSE

VinaCapital Vietnam Opportunity Fund Limited is domiciled in the Cayman Islands. Under the current laws of the Cayman Islands, there is no income, state, corporation, capital gains or other taxes payable by the Company.

The majority of the Group's subsidiaries are domiciled in the British Virgin Islands (BVI) and so have a tax exempt status. Some of the subsidiaries are established in Singapore and have offshore operations in Vietnam. The income from these offshore operations is also tax exempt in Singapore.

A small number of subsidiaries are established in Vietnam and are subject to corporate income tax in Vietnam. However, no provision for corporate income tax has been made for these subsidiaries because they are all in a position where there are no corporate income taxes payable because they either have incurred losses, or have unutilised tax holidays, or have sufficient carry-forward tax losses to offset any taxable income.

The relationship between the expected income tax expense based on the applicable income tax rate (stated below) and the tax expense actually recognised in the consolidated statement of income can be reconciled as follows:

	Year ended
	30 June 2012	30 June 2011
	USD'000	USD'000
Profit/(loss) before tax	28,432 ──────	(35,634) ──────
Profit/(loss) multiplied by applicable tax rate (0%)	-	-
Income tax on Vietnam subsidiaries	-	(203)
Tax expense	───── - ═════	───── (203) ═════

26.  EARNINGS/(LOSS) PER SHARE AND NET ASSET VALUE PER SHARE

(a)  Basic

Basic loss per share is calculated by dividing the loss attributable to equity shareholders of the Company from operations by the weighted average number of ordinary shares in issue during the year excluding ordinary shares purchased by the Company and held as treasury shares (Note 16).

	Year ended
	30 June 2012	30 June 2011
Profit/(loss) for the year (USD'000)	28,432	(36,285)
Weighted average number of ordinary shares in issue	321,013,954	324,610,259
Basic earnings/(loss) per share (USD per share)	0.09	(0.11)
	══════════	═════════

(b) Diluted

Diluted loss per share is calculated by adjusting the weighted average number of ordinary shares outstanding to assume conversion of all dilutive potential ordinary shares. The Group has no category of potentially dilutive ordinary shares.  Therefore, diluted loss per share is equal to basic loss per share.

(c) Net asset value per share

Net asset value (NAV) per share is calculated by dividing the net asset value attributable to equity shareholders of the Company by the number of outstanding ordinary shares in issue as at the reporting date excluding ordinary shares purchased by the Company and held as treasury shares (Note 16). Net asset value is determined as total assets less total liabilities.

	As at 30 June 2012	As at 30 June 2011
Net asset value attributable to owners of the Company (USD'000)	765,645	751,906
Number of outstanding ordinary shares on issue	312,535,596	324,610,259
Net asset value per share (USD/share)	2.45 ═════════	2.32 ══════════

27.  ONGOING CHARGES

	Year ended
	30 June 2012	30 June 2011
Ongoing charges (using AIC recommended methodology)	2.13%	2.13%
Performance fee	-	-
	───── 2.13% ═════	───── 2.13% ═════

Ongoing charges have been calculated in accordance with the Association of Investment Companies ("AIC") recommended methodology dated May 2012. It is the ratio of annualised ongoing charges over the average undiluted net asset value during the year.

28.  DIRECTORS' FEES AND MANAGEMENT'S REMUNERATION

The aggregate directors fees amounted to USD195,000 (year ended 30 June 2011: USD195,000), of which there was no outstanding payable at the reporting date (30 June 2011: nil).

The details of remuneration by director are summarised below:

	Year ended
	30 June 2012	30 June 2011
	USD'000	USD'000
William Vanderfelt	75	75
Martin Glynn	60	60
Michael Gray	60	60
	──── 195 ════	──── 195 ════

The other directors in office during the year and prior year did not receive any fee.

The investment manager has agreed to pay a portion of directors' fees on behalf of the Company the balance or any excess if aggregate annual directors remuneration is higher than USD60,000. Accordingly, the directors' fees borne by the Company for the year ended 30 June 2012 were USD60,000 (30 June 2011: USD60,000).

The board of management and certain other individuals who act on behalf of the Group are remunerated by the investment manager. However, it is not possible to specifically allocate their costs to the Group. Part of the management fees as disclosed in Note 29 were used to remunerate these individuals.

29.  RELATED PARTIES

(a) Management fees

The Group was managed by VinaCapital Investment Management Limited (the "BVI Investment Manager"), a company incorporated in the British Virgin Islands ("BVI"), under a management agreement dated 24 September 2003 (the "Management Agreement"). From 1 January 2011, the Group was managed by VinaCapital Investment Management Limited (the "Investment Manager"), a 100% owned subsidiary company of the BVI Investment Manager incorporated and registered as a licensed fund manager in the Cayman Islands, under the novation agreement between the BVI Investment Manager and the CI Investment Manager. The Investment Manager receives a fee based on the net asset value of the Group, payable monthly in arrears, at an annual rate of 2% (30 June 2011: 2%).

Total management fees for the year amounted to USD14.86 million (30 June 2011: USD14.49 million), with USD1.19 million (30 June 2011: USD5.7 million) in outstanding accrued fees due to the investment manager at the reporting date.

(b) Performance fees

The investment manager is also entitled to a performance fee equal to 20% of the realised returns over an annualised compounding hurdle rate of 8%. There was no performance fee payable for the years ended 30 June 2012 and 30 June 2011.

(c) Acquisition of associate

During the year, the Group acquired the remaining 75% interest in Clear Interest Group Limited which owns 38% equity interest of Kotobuki Holding (Hong Kong) Ltd., from VinaLand Limited, a fund under common management, for USD22.0 million (Note 6).  The purchase consideration has been fully settled during the year and there is no outstanding balance as at 30 June 2012.  There was no transaction of this nature in the prior year.

(d) Receivables/(payables) from/(to) related parties

	30 June 2012	30 June 2011
	USD'000	USD'000
Payments on behalf of related parties (Note 11)	2,941	3,340
Payables to related parties	(2,159)	(8,609)
	═════	═════

(e) Loans to related parties

	30 June 2012	30 June 2011
	USD'000	USD'000
Long-term loans to:
- Associates under common management (*) (Note 6)	35,733	47,991
- An associate	-	7,115
Total long-term loans to related parties	───── 35,733	───── 55,106
	─────	─────
Short-term loans to:
- Current portion of long-term loan to an associate	3,845	575
- Other related parties	6,926	5,762
Total short-term loans to related parties	───── 10,771	───── 6,337
	─────	─────
Total loans to related parties	46,504 ═════	61,443 ═════

(*) Associates under common management refer to associates which have joint investments in real estate projects with VinaLand Limited, another fund managed by VinaCapital Investment Management Limited. These loans form part of the Group's net investment in the associates as settlements are not planned.

The movement of loans to related parties during the year is as follow:

	30 June 2012		30 June 2011
	USD'000		USD'000
Opening balance	61,443		55,534
Loans advanced	1,259		7,496
Loan repayments received	(875)		(1,812)
Reclassified a long-term loan to assets held for sale (Note 14)		(2,527)	-
Loans converted to shares, reclassified to investment in associates (Note 6)	(12,550)		-
Interest charged	874		793
Interest received	(649)		(568)
Impairment of loan receivables	(471)		-
Closing balance	───── 46,504 ═════		───── 61,443 ═════

The long-term loan to an associate is secured by way of shares of an entity listed on the Vietnam stock exchange, bears interest rate of 15% per annum and has a minimum repayment term of USD0.58 million annually. The remaining balance of the loan of USD3.84 million is due and repayable by January 2013.

The short-term loans to other related parties have prepayment terms within 12 months period, are unsecured and carry interest at rates ranging from 1.5% to 15% per annum (30 June 2011: 1.5% to 15%).

No provision was required at 30 June 2012 (30 June 2011: nil) for loans to related parties.

(f) Others

During the year, the Group engaged VinaSecurities Joint Stock Company, a related party, as a securities broker. An amount of USD21,585 (30 June 2011: USD4,592) was paid to this broker as securities brokerage fees charged at prevailing market rates.

30.  COMMITMENTS

The Group has a broad range of commitments under investment licences it has received for real estate projects jointly invested with VinaLand Limited, a related party under common management, and other agreements it has entered into, to acquire and develop, or make additional investments in investment properties and leasehold land in Vietnam. Further investments in any of these arrangements are at the Group's discretion.

31.  FINANCIAL RISK FACTOR

The Group invests in listed and unlisted equity instruments, debt instruments, assets and other opportunities in Vietnam and overseas with the objective of achieving medium to long-term capital appreciation and providing investment income.

The Group is exposed to a variety of financial risks: market risk (including currency risk, interest rate risk, and price risk), credit risk and liquidity risk. The Group's overall risk management programme focuses on the unpredictability of financial markets and seeks to minimise potentially adverse effects on the Group's financial performance. The Group's risk management is coordinated by the Investment Manager who manages the distribution of the assets to achieve the investment objectives.

The most significant financial risks the Group is exposed to are described below:

(a) Market risk analysis

Foreign currency risk sensitivity

The Group's exposure to risk resulting from changes in foreign currency exchange rates is moderate as although transactions in Vietnam are settled in the Vietnam Dong (VND), the value of the VND has historically been closely linked to that of the USD, the reporting currency.  The value of real estate in Vietnam is based on pricing that is a combination of VND, USD and gold. For this reason, a decline in the value of the VND against the USD does not necessarily mean proportionately lower prices will be obtained in USD.

The Group has not entered into any hedging mechanism as the estimated benefits of available instruments outweigh their costs.  On an ongoing basis the Investment Manager analyses the current economic environment and expected future conditions and decides the optimal currency mix considering the risk of currency fluctuation, interest rate return differentials and transaction costs. The Investment Manager updates the Board regularly and reports on any significant changes for further actions to be taken.

As the reporting date, had the VND weakened/strengthened by 5% in relation to USD, with all other variables held constant, there would be a net exchange loss/profit from the financial assets and liabilities denominated in VND (Note 9) of USD23.3 million (30 June 2011: USD20.4 million).

Price risk

Price risk is the risk that the value of the instrument will fluctuate as a result of changes in market prices, whether caused by factors specific to an individual investment, its issuer, or factors affecting all instruments traded in the market.

The Group invests in listed and unlisted equity securities and is exposed to market price risk of these securities.

The Group's unlisted equity securities are susceptible to market price risk arising from uncertainties about future values of the investment securities. The investment manager provides the Group with investment recommendations that are consistent with the Group's objectives. The Investment Manager's recommendations are approved by the investment committee of the Investment Manager.

All securities investments present a risk of loss of capital. The Investment Manager manages this risk through the careful selection of securities and other financial instruments within specified limits and by holding a diversified portfolio of listed and unlisted instruments. In addition, the performance of investments held by the Group is monitored by the investment manager on a monthly basis and reviewed by the Board of Directors on a quarterly basis.

If the prices of the securities were to fluctuate by 10%, the impact on the net asset value of the Group would be a gain/loss of USD39.4 million (30 June 2011: approximately gain/loss of USD36.7 million).

Cash flow and fair value interest rate risk

The Group's exposure to interest rate risk is related to interest bearing financial assets and financial liabilities. Cash and cash equivalents and bonds are subject to interest at fixed rates. They are exposed to fair value changes due to interest rate changes. The Group has no significant financial liabilities with floating interest rates at the balance sheet date. As a result, the Group has limited exposure to cash flow and interest rate risk.

(b) Credit risk analysis

Credit risk is the risk that a counterparty will be unable to pay amounts in full when due. Impairment provisions are provided for losses that have been incurred by the Group at the reporting date.

The Investment Manager maintains a list of approved banks for holding deposits and set aggregate limits for deposits or exposures to individual banks. While this list is formally reviewed at least monthly, it is updated to reflect developments in the market on a timely basis as information becomes available.

All transactions in listed securities are settled upon delivery using approved brokers. The risk of default is considered low, as delivery of securities sold is only made once the broker has received payment. Payment is made for purchases once the securities have been received by the broker.  The trade will be unwound if either party fails to meet its obligations.

The carrying amount of trade and other receivables, loan receivables and available-for-sale financial assets represent the Group's maximum exposure to credit risk in relation to its financial assets.

No credit limits were exceeded during the reporting period, and management does not expect any losses from non-performance by these counterparties.

In accordance with the Group's policy, the investment manager continuously monitors the Group's credit position on a monthly basis, identified either individually or by group, and incorporates this information into its credit controls.

The Group's investment manager reconsiders the valuations of financial assets that are impaired or overdue at each reporting date based on the payment status of the counterparties, recoverability of receivables, and prevailing market conditions.

The Group's exposure to credit risk is limited to the carrying amounts of financial assets recognised at the reporting date, as summarised below:

	30 June 2012	30 June 2011
	USD'000	USD'000
Classes of financial assets - carrying amounts:
Available-for-sale financial assets	34,561	16,923
Long-term loan included in interest in associates	35,733	47,991
Long-term loan to an associate	3,845	7,690
Trade and other receivables	21,537	17,843
Financial assets at fair value through profit or loss	425,281	383,782
Cash and cash equivalents	42,209	62,968
	────── 563,166 ══════	────── 537,197 ══════
Allowance for impairment	(3,746)	(4,225)
	══════	══════

Total allowances of USD3.75 million (30 June 2011: USD4.23 million) had been provided for balances that the Group expected to be uncollectible or impaired. These are for receivables in Note 11.

Cash and cash equivalents and short-term investments are held at banks and financial institutions which do not have histories of default.

The Group has no other significant concentrations of credit risk.

(c) Liquidity risk analysis

The Group invests in both listed securities that are traded in active markets and unlisted securities that are not actively traded.

The Group's listed securities are considered to be readily realisable, as they are mainly listed on the Vietnam Stock Exchanges.

Unlisted securities, which are not traded in an organised public market, may be illiquid. As a result, the Group may not be able to quickly liquidate its investments in these instruments at an amount close to fair value in order to respond to its liquidity requirements or to other specific events such as deterioration in the creditworthiness of a particular issuer.

As at the reporting date, the Group's contractual financial liabilities as shown in the consolidated balance sheet as current is repayable with six months (30 June 2011: six months) from the balance sheet date. The long-term contractual financial liability is not material to the Group.

(d) Capital management

The Group's capital management objectives are to achieve capital growth and ensure the Group's ability to continue as a going concern.

The Group considers the capital to be managed as equal to the net assets attributable to the holders of ordinary shares. The Group is not subject to any externally imposed capital requirements. The Group has engaged the investment manager to allocate the net assets in such a way so as to generate investment returns that are commensurate with the investment objectives outlined in the Group's offering documents.

(e) Fair value estimation

The table below analyses financial instruments carried at fair value, by valuation method. The difference levels have been defined as follows:

·      Level 1: Quoted prices (unadjusted) in active markets for identical assets or liabilities;

·      Level 2: Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (that is, as prices) or indirectly (that is, derived from prices); and

·      Level 3: Inputs for the asset or liability that are not based on observable market data (that is, unobservable inputs).

There are no financial liabilities of the Group which were measured using the fair valuation method as at 30 June 2012 and 30 June 2011.

The level within which the financial asset is classified is determined based on the lowest level of significant input to the fair value measurement.

The financial assets measured at fair value in the consolidated balance sheets are grouped into the fair value hierarchy as follows:

	Level 1	Level 2	Level 3	Total
	USD'000	USD'000	USD'000	USD'000
As at 30 June 2012
Financial assets at fair value through profit or loss in Vietnam:
- Ordinary shares - listed	297,074	-	-	297,074
- Ordinary shares - unlisted	-	65,040	13,934	78,974
- Corporate bonds	-	8,500	-	8,500
-               Government bonds	17,412	-	-	17,412
Financial assets in countries other than Vietnam:
- Ordinary shares - listed	23,321	-	-	23,321
Available-for-sale financial assets:
- Private equity investments	28,450	-	6,111	34,561
	─────── 366,257 ═══════	────── 73,540 ══════	────── 20,045 ══════	─────── 459,842 ═══════

As at 30 June 2011
Financial assets at fair value through profit or loss in Vietnam:
- Ordinary shares - listed	241,521	-	-	241,521
- Ordinary shares - unlisted	-	79,494	13,934	93,428
- Corporate bonds	-	11,381	-	11,381
Available-for-sale financial assets
- Private equity investments	-	-	16,923	16,923
Financial assets in countries other than Vietnam:
- Ordinary shares - listed	37,452	-	-	37,452
	─────── 278,973 ═══════	────── 90,875 ══════	────── 30,857 ══════	─────── 400,705 ═══════

During the year, the transfers between the levels are as follows:

	Level 1	Level 2	Level 3	Total
	USD'000	USD'000	USD'000	USD'000
Available-for-sale financial assets:
- Private equity investment	28,450	-	(28,450)	-
	══════	══════	══════	══════

The transfer of available for sale financial assets from level 3 to level 1 during the year is due to the Group has entered into an agreement to sell the interest in Indochina Food Industries (Note 8), and the Group considers the committed price as level 1 in the fair value hierarchy. 

Other than the above, there were no other transfers between levels of fair value hierarchy (year ended 30 June 2011: no transfers between levels of fair value hierarchy). There were also no reclassifications of financial assets in the current year and in prior year.

The fair value of financial instruments traded in active markets is based on quoted market prices at the balance sheet date. A market is regarded as active if quoted prices are readily and regularly available from the exchange, dealer and broke, and those princes represent actual and regularly occurring market transactions on an arm's length basis. The quoted market price used for financial assets held by the Group is the current bid price. These instruments are included in Level 1. Instruments included in Level 1 comprise the Vietnam stock exchanges equity investments classified as trading securities or available for sale. The level 1 fair value may also include committed prices at the balance sheet date to sell the unlisted equity instrument.

The fair value of financial instruments that are not traded in an active market (for example, over-the-counter derivatives) is determined by using valuation techniques. These valuation techniques maximise the use of observable market data where it is available and rely as little as possible on entity specific estimates. If all significant inputs required to fair value an instrument are observable, the instrument is included in Level 2.

If one or more of the significant inputs is not based observables market data, the instrument is included in Level 3.

The methods and valuation techniques used for the purpose of measuring fair value are unchanged compared to the previous reporting period.

The following table presents the changes in Level 3 financial assets:

                                                                                                                                   Year ended

	30 June 2012	30 June 2011
	USD'000	USD'000
Opening balance	30,857	16,955
Transfers out of Level 3	(28,450)	-
Purchases of available-for-sale financial assets (Note 8)	2,223	7,112
Transferred (to)/from interest in associate	(8,165)	2,895
Gain recognised in income statement (Note 23)	9,400	3,895
Gain recognised in available-for-sale investment reserve	14,180	-
Closing balance	───── 20,045 ══════	───── 30,857 ══════
Total gains for the year included in:
- Income statement	9,400	3,895
- Other comprehensive income	14,180	-
	───── 23,580 ═════	───── 3,895 ═════

Due to numerous uncertainties regarding the future development of these investees, the fair value of the Group's equity interest in these level 3 instruments cannot be reliably measured and therefore have been stated at cost less impairment charges. However, management believes the changing inputs to the Level 3 valuation to a reasonable possible alternative assumption would not change significant amounts recognised in profit or loss, total assets, total liabilities or total equity.

32.  EVENTS AFTER THE REPORTING PERIOD

Treasury shares

Subsequent to 30 June 2012 and up to the date the financial statements is authorised for issue, the Group has purchased a further 21,844,137 ordinary shares of the Company for a total cash consideration of USD35.4 million at an average cost of USD1.62 per share during the period. 

Accordingly, as at 22 October 2012, the Group has spent USD53.3 million overall repurchasing 33,918,800 shares which are held as treasury shares. The total number of shares acquired since November 2011 represents 10.45 percent of the Company's 324,610,259 Ordinary Shares in issue and as a result, total voting rights in the Company have been reduced to 290,691,459.

33. COMPARATIVE FIGURES

Certain comparative figures in the consolidated financial statements have been reclassified to conform to the current year's presentation. These changes are of a presentational nature and do not have any impact on the prior year's consolidated financial statements.

The significant reclassification is as follows:

	30 June 2011	Reclassification	30 June 2011
	USD'000	USD'000	USD'000
Investments in associates	199,579	47,991	247,570
Long-term loans to related parties	51,836	(47,991)	3,845

                                                                        ═════                 ═════                    ═════

The settlements of the loans to associates were neither planned nor likely to occur in the foreseeable future and therefore, in substance, the loans to associates are an extension of the Group's investment in the associates. Accordingly, the balance in the long-term loans to related parties is reclassified to investments in associates in the current year.

 

END

 

 

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