Clarification of the effect of change in accounting policy
15 May 2007
Translation
14 May 2007
Subject : Clarification of the effect of change in accounting policy
To : Director and Manager
Stock Exchange of Thailand
According to the Company has changed its accounting policy for investment
in subsidiaries in the company financial statements from the equity method to
the cost method in compliance with the Federation of Accounting Professions'
announcement which has been reported to SET as per our letter of submission of
financial statement for the quarter 1/2007 on 11 May 2007. In addition, the
Company would like to clarify the effect of change in accounting policy as
follows:
Since 1 January 2007, the Company has changed its accounting policy for
investment in subsidiaries in the company financial statements from the equity
method to the cost method in compliance with the Federation of Accounting
Professions' announcement. The Company applies retrospective adjustments. As a
result, the company balance sheet as at 31 December 2006 and the company
statement of income for the three-month period ended 31 March 2006 presented
for comparative purposes have been restated. The change in such accounting
policy has an impact to the company financial statement only and does not have
an impact to the consolidated financial statements.
The effect of applying new accounting policy to the company balance sheet
as at 31 December 2006 and the company statement of income for the three-month
period ended 31 March 2006 are as follows:
Balance sheets as at 31 December 2006
Decrease in investments in subsidiaries (Baht'000) 1,805,927
Decrease in retained earnings (Baht'000) 1,805,927
The cumulative effect of the accounting policy has been presented under the
subject of "Cumulative effect of the change in accounting policy for investments
in subsidiaries" in the company financial statements in the Statements of
Changes in Shareholders' Equity.
Statement of income for the three-month period ended 31 March 2006
Decrease in share of the net profits from
investments - equity method (Baht'000) 63,978
Decrease in net profit (Baht'000) 63,978
Decrease in basic earnings per share (Baht) 0.27
However, the change of accounting policy affected only the company
financial statement. It did not have any effect on the consolidated financial
statements or business fundamentals.
Please be informed accordingly.
Yours faithfully,
Siam Makro Public Company Limited
Signature
(Mr Charoen Assawajarukasem)
SET Coordinator Manager