Annual Report 2012 EN

ContentsCompany BackgroundVision MissionSummary Financial Information 1Message from the Chairman 2Board of Directors 4Corporate Social Responsibility 8General Information 12Nature of Business 15Risk Factors 18Shareholders and Management 23 Related Party Transactions 37Corporate Governance 40Internal Controls 50Corporate Governance Report on Audit Committee 52Nomination and Remuneration Committee’s Report 54Board of Director’s Responsibility for Financial Report 55Management’s Discussion and Analysis 56Auditor’s Report 60Financial Statement 62

Company Background

Thai Rung Union Car Plc has long been established as a maker of auto body

parts and a vehicle assembler. Originally founded as a limited partnership

under the name Thai Engineering in 1967 by Mr. Vichien Phaoenchoke, its

business success eventually led to its become a listed company on the Stock

Exchange of Thailand in 1994 under the current name, Thai Rung Union Car

Public Company Limited.

For 45 years Thai Rung Union Car Plc., a Thai-owned company, has been a fully integrated and highly flexible operator

in the automotive industry, quickly meeting customer demands that range from product design and development,

through die and jig production and manufacture of metal and plastic auto parts and seats, to contract painting and

assembly and the production of modified multi-purpose and special purpose vehicles, all based on the skills and

capabilities of its Thai workforce and using advanced technology.

At present, adapting its strategy in line with the rapid growth of the Thai automotive

industry, the Company focuses mainly on OEM parts, contract assembly and painting,

and on expanding its market for parts and bodies to various regions around the

world, as well as seeking alliances to expand its existing business and develop new

ones. Furthermore the Company has boosted its potential, both by continuously

developing production processes and by applying innovative technology to the

production process in order to increase efficiency, reduce costs and increase future

profits as well as developing human resources to cater to the coming into force of

the AEC in 2015 and any other international trade and investment.

The Company is confident that, thanks to its all-round production capabilities and flexibility in responding quickly to

customer requirements, as well as its close relationships with customers at home and abroad, it will benefit from the

many opportunities that lie ahead in the automotive industry. We are thus confident that the Company’s results will

continue to grow rapidly in step with the Thai automotive industry.

Vision To be at the pinnacle of the Thai auto industry, developing, designing

and producing a comprehensive range of products; with our own brand,

to build optimum customer satisfaction through world-class quality and service.

Mission 1. To be a leader in the design, development and production of innovative automotive products: multi-purpose

and specialty vehicles, parts, dies, jigs and accessories.

2. To maximise customer satisfaction by providing world-class quality, price, delivery and service.

3. To focus on continuous improvement in product and service quality through the efficient use of flexible,

speedy production and management processes and up-to-date engineering technology.

4. To build own brand image and loyalty.

5. To establish and expand marketing and sales networks at home and abroad.

6. To pay close attention to the development and welfare of our human resources, so as to enable them to

compete at world level and to be happy and proud to work for the organisation.

7. Continuously to enhance the stability of the organisation by making profits and providing fair remuneration

for shareholders, business partners and employees.

8. To ensure that products, production and work processes all take due account of our responsibilities

towards environment, community and society through principles of good corporate governance.

Vision Mission

Significant Financial Data

Unit: Million Bt.

Consolidated, as at 31st December 2012 2011 2010

Operating PerformanceSales and Service Income 3,499.58 2,054.78 1,970.21

Total Revenues 3,780.84 2,263.10 2,149.03

Total Expenses 3,097.31 1,996.30 1,925.29

683.53 266.80 223.74

Net Earnings (loss) attributable to equity holders of the parent

555.80 186.22 186.37

Financial Position

Current Assets 1,770.44 1,083.10 1,285.69

Total Assets 3,862.16 3,004.26 2,987.51

Total Liabilities 772.67 362.18 384.49

Shareholders’ Equity 3,089.49 2,642.08 2,603.02

Per Share Data (Unit: Baht)Earnings (loss) per Share (EPS) 1.13 0.38 0.38

Dividend per Share * 0.60 0.25 0.25

Book Value per Share 6.11 5.20 5.13

Financial Ratios (Unit : %)

Net Earnings margin 14.70 8.23 8.67

Return on Equity (ROE) 20.01 7.32 7.78

Return on Asset (ROA) 19.91 8.91 8.04

Remark * Payment of the dividend payment is subject to approval by the 2013 Annual General Shareholders’ Meeting.

Summary Financial Information

Total Revenues (Million Bt) Net Earnings (loss) attributable to equity holders of the parent (Million Bt)

Total Assets (Million Bt)

2010 2011 2012 2010 2011 2012

2,14

9.03

2,26

3.10

3,78

0.84

555.8018

6.37

186.22

2010 2011 2012

2,98

7.51

3,00

4.26

3,86

2.16

Annual Report 2012THAI RUNG UNION CAR PUBLIC COMPANY LIMITED 1

Message from the Chairman

In 2012, the Thai automotive industry posted all-time record production of 2.4 million units, representing an increase

of 68% relative to 2011 and putting Thailand in the world’s top ten automakers. Domestic sales, at 1.43 million units,

showed an increase of 80%, largely thanks to the government’s economic stimulus package.

Despite being faced in 2012 with a stagnant global economy, an increase in the Thai minimum legal daily wage to

Bt.300, fluctuating fuel prices, a strengthening Baht and fierce competition both domestically and at ASEAN level,

the Company was able not only to overcome all obstacles, thanks to the determined efforts of management and

employees, who trust in the Company’s sound status based on many years of experience, but also to develop

appropriate strategies for seeking opportunities for expansion.

Thai Rung Union Car Plc posted consolidated revenues of Bt.3,781 million for 2012, up by 67%, and net income

attributable to owners of the parent company of Bt.556 million, up by 199% on 2011. Growth in the Company’s

revenues outstripped that of the automotive industry as a whole, thanks to its adjusting its strategy to place more

stress on OEM parts making and contract assembly and painting work, which together now account for about 80%

of consolidated revenues, and also to its success in expanding the customer base to take in new segments such

as industrial and construction equipment, agricultural machinery and premium motorcycles, which is a high added

value niche market, thus helping to reduce the risk of over-concentration.

In 2013 we expect Thailand’s vehicle production to reach 2.8 million units, up by 15% on 2012, since all automakers

in Thailand have invested in increasing their production capacity to cater to continuously growing consumer demand

at home and abroad, especially for pick-up trucks and eco-cars. The government’s policy of promoting Thailand as a

leading world automotive production base will also play a role, as will the coming into force of the ASEAN Economic

Community (AEC) in 2015, which will stimulate growth in the industry.

Annual Report 2012THAI RUNG UNION CAR PUBLIC COMPANY LIMITED2

These trends provide significant opportunities for the Company to obtain both metal and plastic parts-making

work, as well as contract assembly and painting work, which constitute the Company’s main sources of revenue.

Furthermore, the Company has taken steps to prepare for increasing its capabilities both by boosting production

capacity and efficiency by investing in new machinery and technology and by developing its workforce, as well as

managing its risks in advance so as to cater to any foreign trade and investment opportunities. Additionally, the new

parts making factory in Rayong province has been working at full efficiency since the beginning of 2013, to cater to

growing customer demand. The Company also has plans for further investment in all areas, to cater to the growing

volumes of customer orders.

It is pleasing to note that several groups of investors have expressed interest in joint investments with Thai Rung to

expand its business base in various areas related to its existing business, and to conduct research and development

of new, high added value products so as to increase its market share and generate extra revenue in the future. The

Company will also continue to boost production efficiency and to make determined efforts to reduce costs in various

areas, for the good of the Company and in accordance with principles of good corporate governance, and to attach

importance to its responsibilities towards society, community, the environment and all stakeholder groups, in

accordance with principles of corporate social responsibility, conducting its business in an ethical manner so as to

ensure the Company’s sustainable success.

On behalf of the Company’s Board of Directors, I should like to thank our customers, our shareholders, the various

organisations and departments both governmental and private, our business partners and also our executives and

employees for their constant support, which is a driving force. All the Directors and I will strive wholeheartedly to

lead the Company constantly forward and develop and expand its business in a sustainable manner.

Dr. Pranee Phaoenchoke

Chairman


Board of Directors

Dr. Pranee PhaoenchokeC�a�r� an o� t�e Boar� o� D�re�tor� � Pre��entAge : 74

Academic Qualifications Honorary doctorate in Business Administration,

American Coastline University, U.S.A. Honorary doctorate in Industrial Engineering,

Ramkhamhaeng University Honorary Master’s Degree in Commerce and Accountancy

Thammasart University

Present Position Chairman of the Board of Directors & Chairman of the Executive

Committee of Thai Rung Union Car Plc. Director & Chairman of

Thai Rung Tools and Dies Co., Ltd. Thai V.P. Auto Service Co., Ltd.

Thai Auto Pressparts Co., Ltd. Thai Ultimate Car Co., Ltd.

Isuzu Chaicharoenkij Motors Co., Ltd. Thai V.P. Corporation Co., Ltd.

Chaicharoenkij Motors Co., Ltd. Lexus Auto City Co., Ltd.

Biz Motor Co., Ltd. V.P. Auto Enterprise Co., Ltd.

V.P.K. Auto Co., Ltd. First Part Co., Ltd.

Sinthoranee Property Co., Ltd. Director of Delta Thairung Co., Ltd.

Shareholding as of 5 February 2013: 246,387,500 shares (49.12%)

Mr. Pricha Attavipach In�epen�ent ��re�tor� Deput� ��a�r� an � C�a�r� an o� t�e Boar� o� D�re�tor�� Au��t Co� � �tteeAge : 75

Academic Qualifications Bachelor’s Degree in industrial engineering

Chulalongkorn University Master’s Degree (MS) in engineering (Industrial Engineering

& Management) Oklahoma State University, U.S.A. National Defence College of Thailand, Class of 1989 Director Certification Program 39/2004: IOD Finance for Non-Finance Directors 8/2004: IOD

Present Position Deputy Chairman of the Board of Directors Independent director, Deputy chairman & Chairman of the Board of

Directors, Audit Committee and Nomination & Remuneration Committee of Thai Rung Union Car Plc.

Director and Member of the Audit Committee, Siam Cement Plc. Chairman of

Thai Sugar Terminal Plc Ruamkijaungthong Warehouse Co., Ltd.

Pan-Paper 1992 Co., Ltd. Ekaratpattana Co., Ltd.

T.S.G. Assets Co., Ltd. T.S. Flour Mill Plc.

T.S. Oil Industry Co., Ltd. Ruamphol Enterprise Nakorn Sawan Co., Ltd. Kaset Thai Sugar Co., Ltd.

Thai Identity Sugar Factory Co., Ltd. Director of

H.C. Starck (Thailand) Co., Ltd. Siam P.P. International Co., Ltd.

Specialist Senior Engineering (Industrial Engineer), Council of Engineers

Law Councillor, Ministry of Labour Academic Director of the Safety and Health Vocational Management

System, The Engineering Institute of Thailand Chairman of the Council, Chao Phraya University Chairman, Khunying Phancheun Reunsiri Foundation Chairman, Ajarn Lai-arj Phamarapa Foundation Chairman, Industrial Development Foundation

Shareholding as of 11 February 2013: 60,000 shares (0.01%)

(including shareholdings of related persons as per Section 258 of the SEC Act)

Annual Report 2012THAI RUNG UNION CAR PUBLIC COMPANY LIMITED�

Mr. Sompong PhaoenchokeD�re�tor � Mana��n� D�re�torAge : 52

Academic Qualifications Master’s degree in Industrial Engineering,

Keio University, Japan National Defence College Class of 2006 Capital Market Academy No.8 National Defence College Course in high level security management

and administration (class of 2010) Director Certification Program 26/2003: IOD

Present Position Director & Managing Director,

Chairman of Risk Management Committee of Thai Rung Union Car Plc.

Director & Vice President of Thai Ultimate Car Co., Ltd. Delta Thairung Co., Ltd.

Isuzu Chaicharoenkij Motors Co., Ltd. Thai V.P. Corporation Co., Ltd.

First Part Co. Ltd. V.P. Auto Enterprise Co. Ltd.

Biz Motor Co. Ltd. Lexus Auto City Co., Ltd.

Director & Managing Director of Thai Rung Tools and Dies Co., Ltd.

Thai V.P. Auto Service Co., Ltd. Thai Auto Pressparts Co., Ltd. Director of

Thai Auto Conversion Co., Ltd. Chaicharoenkij Motors Co., Ltd.

Sinthoranee Property Co., Ltd.


(including shareholdings of related persons as per Section 258 of the SEC Act)

Ms. Kaewjai PhaoenchokeD�re�torAge : 48

Academic Qualifications Bachelor Degree in Financial Administration

University of New England Australia Executive Program “Owner/President Management Program” No. 42

Harvard Business School, USA Winning with Strategy :YPO (Thailand) Secret of Effective Business : YPO (Thailand) Cambridge-Thammasat Executive Education Program “Leadership”

No.1 University of Cambridge, England Positive Psychology : YPO (Thailand) Strategic Human Resource Management

Thammasat University Director Certification Program 29/2003: IOD The Boss Executive Educational Program No.38

Management and Psychology National Defence College Class of 2013

Present Position Director & Executive Board

of Thai Rung Union Car Plc. Director & Chief Executive Officer

of Thai V.P. Corporation Co., Ltd. Thai Ultimate Car Co., Ltd.

Isuzu Chaicharoenkij Motors Co., Ltd. First Part Co., Ltd. Biz Motor Co., Ltd.

V.P. Auto Enterprise Co., Ltd. V.P.K. Auto Co., Ltd.

Director of Thai V.P. Auto Service Co., Ltd.

Thai Rung Tools and Dies Co., Ltd. Thai Auto Pressparts Co., Ltd.

Chaicharoenkij Motors Co., Ltd. Sinthoranee Property Co., Ltd.


Annual Report 2012THAI RUNG UNION CAR PUBLIC COMPANY LIMITED �

Mr. Somkiat NimraweeIn�epen�ent D�re�torAge : 61

Academic Qualifications Bachelor’s degree in Finance & Accounting,

Thammasart University Director Accreditation Program 10/2004: IOD

Present Position Independent Director, Member of Risk Management Committee,

Executive Board and Nomination & Remuneration Committee of Thai Rung Union Car Plc.

Managing Director of Dan-Thai Equipment Co., Ltd. Dan-Thai Handing System Co., Ltd. Dan-Thai Engineering Co., Ltd.

Shareholding as of 5 February 2013: 80,000 shares (0.02%)

Mr. Wuttichai PhaoenchokeD�re�torAge : 43

Academic Qualifications Master’s degree in Automotive Engineering,

Coventry University, U.K.

Present Position Director and Executive Board of Thai Rung Union Car Plc. Director & Managing Director of

Isuzu Chaicharoenkij Motors Co., Ltd. Chaicharoenkij Motors Co., Ltd.

Sinthoranee Property Co., Ltd. Director & Deputy Managing Director of

Thai V.P. Auto Service Co., Ltd. Director of

Thai Rung Tools and Dies Co., Ltd. Thai Auto Pressparts Co., Ltd.

Thai Ultimate Car Co., Ltd. V.P. Auto Enterprise Co., Ltd.

Thai V.P. Corporation Co., Ltd. Biz Motor Co., Ltd.



Mr. Kavee VasuvatIn�epen�ent D�re�tor �Me� �er� Au��t Co� � �tteeAge : 77

Academic Qualifications Bachelor’s degree in Electrical Engineering,

Royal Melbourne Institute of Technology, Australia

Director Forum Program 1/2000 : IOD

Director Accreditation Program 23/2004 : IOD

Director Certification Program 58/2005 : IOD

Finance for Non-Finance Directors 18/2005 : IOD

Audit Committee Program 10/2005 : IOD

Present Position Independent Director & Member, Audit

Committee and Nomination & Remunera-tion Committee of Thai Rung Union Car Plc.

Independent Director & Chairman Audit Committee and Member Remuneration Committee of Thai Steel Cable Plc.

Chairman of Q.E.D. Creation Co., Ltd.

Shareholding as of 5 February 2013: None

Mr. Damri TunshevavongIn�epen�ent D�re�torAge : 59

Academic Qualifications Becheor’s degree in electrical engineering,

Chulalongkorn University Advanced Management Program

Harvard University, USA. Capital Market Academy

(class of 2009) Director Certification Program 106/2008

: IOD Audit Committee Program 24/2008 : IOD Role of the Chairman Program 22/2009

: IOD Role of Compensation Committee 10/2010

: IOD

Present Position Independent Director

of Thai Rung Union Car Plc. Advisor to the President & CEO

of Siam Cement Group Plc. Vice Chairman of Aira Capital Plc. Director of Thai Cane Paper Plc. Director of Yamato Kogyo Plc. (Japan) Director of Iron and Steel Institute

of Thailand

Shareholding as of 5 February 2013: None

Mr. Suvait TheeravachirakulIn�epen�ent D�re�tor �Me� �er� Au��t Co� � �tteeAge : 54

Academic Qualifications Bachelor’s degree in Business Administra-

tion, Accounting, Ramkhamhaeng University

Master’s degree in MBA, Wagner College, New York NY, U.S.A.

Capital Market Academy No.10 Director Certification Program 9/2001: IOD Audit Committee Program

15/2006: IOD

Present Position Independent Director & Member, Audit

Committee and Risk Management Committee of Thai Rung Union Car Plc.

Director & President of MBK Plc. Director of Royal Orchid Hotel (Thailand)

Plc. Director of IFS Capital (Thailand) Plc. Executive Director of Patum Rice Mill and

Granary Plc. Executive Director of Siam Piwat

Co., Ltd. Director of Vachirachart Consultant Co.,

Ltd.

Shareholding as of 5 February 2013: 15,012 shares

(0.003%)


Thai Rung attaches importance to conducting its business in a socially and environmentally responsible manner and

contributing towards the sustainability of the country’s economy and society, instilling moral and ethical values in

its employees in line with the Company’s philosophy “Think right, do right, talk right”, encouraging them to live their

lives in accordance with the philosophy of the sufficiency economy, raising their awareness of social responsibility in

the interests of a mutually beneficial relationship between the Company and society and ensuring the sustainability

of its business.

Thai Rung is committed to supporting society through volunteer work and charitable activities.

Yout� an� E�u�at�onal A�t��t�e�

The Company has always recognised education as an essential element of the country’s progress and development.

Thus the Company supports youth and educational activities on an ongoing basis, with a view to instilling healthy

attitudes in today’s younger generation. Here are some of the activities of the past year.

1. Dr. Pranee Phaoenchoke Chairman, Mr. Sompong Phaoenchoke

Managing Director of Thai Rung Union Car Plc together with other

senior executives presented scholarships to children of employees

of the Thai Rung group of companies as they have done every

year since 1985, latterly on 18 March every year, Thai Rung Day,

the anniversary of the death of Mr. Vichien Phaoenchoke, the

founder of Thai Rung.

2. The Company attaches great importance to children, who will

grow up to be the future of the nation, and accordingly supports

and encourages employees wishing to volunteer by means of the

Thai Rung Group Development Volunteers Association, which

cooperates with government and private sector organisations.

This project is carried out every year in an effort to supply basic

essentials to underprivileged schoolchildren in remote areas.

Corporate Social Responsibility


�o��al an� En��ron� ental A�t��t�e�

Every year Thai Rung supports a wide range of charitable, social and environmental causes in the community. The

Company is dedicated to working with charitable organisations that share our goal of helping communities to improve

through donations and sponsorships. We provide significant support to local communities in the areas of health,

culture, education and sports. Activities were as follows:

3 The Company recognizes the importance of community where

Thai Rung is located. Therefore senior executive has established

community relations project that aims to assist and develop

community together and continue support for public charities every

year such as the following :

Providing scholarships to promising poor pupils at schools in

the Nong Khaem community.

Promoting anti-drug campaign in the organization and

community.

Donating medical equipment to other many hospitals for example

respirator equipment to Luang Pho Taweesak Hospital and etc .

Providing financial support to the family of a Nong Khaem

policeman killed in the line of duty.

4 The Company also has projects to help society in general, the

senior executives and employees engage in activities including

fund raising and budget allocation for medical and public health

services such as the following;

Providing scholarships for unprivileged children, through

various charitable organizations such as the Phra Dabos

Foundation and others.

Donating medical support and equipment for nationwide

hospitals and a VIP ward for Thammasat University Hospital

Rangsit.

Donating essential supplies and financial support to Baan

Bangkae Elderly House.


6. The Company also concerns, not only environment but also the

wide animal. Therefore the Company organizes the walking rally

for helping Thai elephant.

5 Mangrove forest project in Bang Khun Thien district aims to

commemorate His Majesty The King’s Birthday on 5 December.

Rel��ou� A�t��t�e�

The Company is convinced that a liveable and sustainably developing Thai society needs to be firmly underpinned

by religion. The following are examples of the religious activities which it organised over the course of the year to

promote goodness and virtue.

7. Senior executives and employees make merit together by giving

food to monks and listen to a sermon at the beginning of each

New Year. So that they start the year’s work with a positive

attitude. Employees are also given the opportunity to make merit

together on a regular basis.

8. The Company attaches great importance to this area, and

therefore launched the “Mens Sana in Corpore Sano” project,

which brings together employees and members of the local

community for a session of meditation and to hear a sermon by

a monk on a different theme each week.


9. Given the importance of religion to Thai society, the

Company consistently supports the traditions of Buddhism and

other major religions. The Company has continued to arrange

many activities together with charitable organizations and

Buddhism associations as follow:

Every year the Company co-hosts a ceremony of offerings for

a sermon on the incarnation of Lord Buddha with the National

Office of Buddhism.

Hosting the vegetarian festival at the Guanyin shrine in Nong

Khaem every year.

Donating essential supplies and financial support to poor

convents in various provinces every year.

Ot�er A�t��t�e�

10. Senior executives of the Thai Rung Union Car Plc received the

Outstanding Workplace Award in the category Labour Relations

and Welfare from the Department of Labour Protection and

Welfare at the Santimaitree Building, Government House. This

was the seventh successive year (2006- 2012) that the Company

has won this award, and Thai Rung Tools and Dies Co Ltd also

won the same award, for the fifth successive year (2008-2012).

11. Thai Rung Union Car Plc received the “President Award” from

Bangkok Komatsu Co Ltd (BKC).


General Information

Listed Company Thai Rung Union Car Public Company Limited

Companies Register Number 0107536001435

Registered share capital Bt.524,996,497 divided into 524,996,497 ordinary shares of Bt.1 each.

Paid-up share capital Bt.501,589,497

Business Activities Product design, research and development

Manufacture of dies and jigs

Manufacture of automotive parts and seats

Contract vehicle painting and assembly, vehicle modification

Address 28/6 Moo 1, Phetkasem Road Soi 81,

Nongkhangplu, Nong Khaem, Bangkok 10160

Tel: 0-2431-0071-2, 0-2431-0065, 0-2420-0076

Fax: 0-2812-0844, 0-2814-5030, 0-2420-3664

Website http://www.thairung.co.th

Securities Registration Thailand Securities Depository Company Limited

62, Stock Exchange of Thailand Building,

Rachadaphisek Road, Klong Toey, Bangkok 10110

Tel: 0-2229-2800, 0-2654-5599

Fax: 0-2359-1259

Auditors Mr. Atipong Atipongsakul CPA No. 3500 and/or

Mr. Prawit Viwanthananut CPA No. 4917 and/or

Mr. Bunjong Pichayaprasat CPA No. 7147 and/or

Mr. Vichai Ruchitanont CPA No. 4054 and/or

Mr. Sathien Vongsnan CPA No. 3495

ANS Audit Co., Ltd.

100/72, 22nd Floor, 100/2 Vongvanij Building B,

Rama 9 Road, Huaykwang Bangkok 10310

Tel: 0-2645-0109

Fax: 0-2645-0110


Group �tru�ture o� T�a� Run� Un�on Car Pu�l�� Co� pan� L�� te�and subsidiaries as at 31 December 2012

General Information on Subsidiaries and Joint Venture Companies

Subsidiary Companies

Thai Rung Tools and Dies Co., Ltd. Registered share capital Bt.27,000,000 issued and fully paid up,

divided into 270,000 ordinary shares of Bt.100 each

Business Activities Manufacture of dies and jigs.

Address 28/22 Moo 1, Phetkasem Rd. Soi 81, Nongkhangplu, Nong Khaem, Bangkok 10160

Tel: 0-2431-0071-2, 0-2431-0065, 0-2420-0076

Fax: 0-2814-5030, 0-2420-3664

Thai Auto Pressparts Co., Ltd. Registered share capital Bt.400,000,000 issued and fully paid up,

divided into 4,000,000 ordinary shares of Bt.100 each

Business Activities Manufacture of automotive body parts

Address Amata City Industrial Estate

7/122 Moo 4, National Highway 331, Tambol Marpyarngphorn,

Amphoe Pluak Daeng, Rayong 21140

Tel: (038) 956-156, 956-239-42

Fax: (038) 956-169

Thai Rung Union Car Plc.�TRU�

T�a� Auto Con�er��on Co�� Lt��20�

T�a� Auto Pre��part� Co�� Lt��1�

Delta T�a�run� Co�� Lt��30�

T�a� �� P� Auto �er��e Co�� Lt��

T�a� Run� Tool� an� D�e� Co�� Lt��

T�a� Ult�� ate Car Co�� Lt��3�


Thai V.P. Auto Service Co., Ltd. Registered share capital Bt.25,000,000 issued and fully paid up,

divided into 250,000 ordinary shares of Bt.100 each

Business Activities Sale of spare parts and accessories, after-sales service centre,

installation of LPG and CNG vehicle conversion units.

Address 151 Macharoen Rd., Nongkhangplu, Nong Khaem, Bangkok 10160

Tel: 0-2420-6708, 0-2420-4823, 0-2812-1445-6

Fax: 0-2420-1601

Website www.trservice.in.th

Thai Ultimate Car Co., Ltd. Registered share capital Bt.25,000,000 issued and fully paid up,

divided into 25,000 ordinary shares of Bt.1,000 each

Business Activities Providing automotive, consulting and general administrative and organisational services

Address 28/22 Moo 1, Phetkasem Rd. Soi 81,

Nongkhangplu, Nong Khaem, Bangkok 10160

Tel: 0-2431-0071-2, 0-2431-0065, 0-2420-0076

Fax: 0-2812-1992

Joint Venture Companies

Thai Auto Conversion Co., Ltd. Registered share capital Bt.74,500,000 issued and fully paid up,

divided into 74,500 ordinary shares of Bt.1,000 each

Business Activities Product development and fitting of special accessories for special purpose vehicles.

Address 159, Moo 16, Thaeparak Road, Tambol Bang Sao Thong, Amphoe Bang Sao Thong,

Samut Prakarn Province 10540

Tel: 0-2313-1371-8

Fax: 0-2313-1380

Delta Thairung Co., Ltd. Registered share capital Bt.300,000,000 issued and fully paid up,

divided into 3,000,000 ordinary shares of Bt.100 each

Business Activities Manufacture of auto seats and parts and other equipment for vehicles

Address Amata City Industrial Estate

7/150 Moo 4, Tambol Marpyarngphorn, Amphoe Pluak Daeng, Rayong 21140

Tel: (038) 650-398-400

Fax: (038) 650-400

Note: Delta-TR Co., Ltd. a joint venture, filed for dissolution with the Department of Business Development of the Ministry of Commerce on 6 March 2012.

Annual Report 2012THAI RUNG UNION CAR PUBLIC COMPANY LIMITED1�

General Bu��ne�� O�er��e� o� t�e Co� pan�� t� �u��ar�e� an� �o�nt �enture�

Thai Rung Union Car Public Co., Ltd. is in the motor vehicle industry. Its main business activities are product design,

research and development, manufacture of tools, dies and jigs, manufacture of metal and plastic parts, contract

vehicle painting and assembly and modification of vehicles, including multi-purpose vehicles and special purpose

vehicles such as TR Transformer, Military Utility Vehicle 4 (MUV4) and rapid response rescue vehicles.

The Company has six subsidiary and joint venture companies, which are engaged in related or supporting businesses

and which enable the group to provide a full range of services as well as spreading the business risks. Details are

as follows.

Thai Rung Union Car Plc. has three business units as follows;

Product design, research and development and contract research, design and modification of various types

of vehicles for domestic and overseas customers.

Pressed metal and plastic parts and seats for car, truck and motorcycle manufactures, parts for construction

tools, industrial and agricultural machinery, or other businesses beyond the auto industry such as electronic

components, as well as for use in its own internal production processes.

Paint work and contract assembly for the automobile customers, the industrial and agricultural machinery

sectors and modification of vehicle for multi-purpose vehicles and special purpose vehicles such as TR

Transformer, Military Utility Vehicle 4 (MUV4) and rapid response rescue vehicles.

Thai Rung Tools and Dies Co., Ltd. (TRT) makes dies and jigs. It has received BOI promotional privileges

for investments.

Thai Auto Pressparts Co., Ltd. (TAP) started business in June 2002 at its factory at Amata City Industrial

Estate, Amphoe Pluak Daeng, Rayong Province, thus considerably expanding the group’s parts production

capacity. Thai Auto Pressparts, which has been granted BOI promotional privileges for its investments, supplies

automotive parts to the customer group formed by auto and motorcycle manufacturers in the Eastern Seaboard

and surrounding areas, and also caters to the export market. In 2012 , the new factory in Rayong province has

already started commercial operation.

Thai V.P. Auto Service Co., Ltd. (TVS) provides after-sales service for Thai Rung’s multi-purpose vehicles.

In 2005 it expanded its activities to include plastic accessories under the name “Parto”. In 2008 it extended its

range of services to include the installation of LPG and CNG vehicle conversion units. In 2012, The Company

starts paint work to cater the growth of customer demand.

Nature of Business

Annual Report 2012THAI RUNG UNION CAR PUBLIC COMPANY LIMITED 1�

Thai Ultimate Car Co., Ltd. (TUC) a subsidiary of TVS which it acquired in 2001. Its current activity consists

of providing automotive consulting and general administrative and organisational services.

Thai Auto Conversion Co., Ltd. (TAC) is a joint venture with the Toyota Motor Group for product development

and fitting of accessories for special purpose vehicles.

Delta Thairung Co., Ltd. (DTC) is a joint venture with Delta Kogyo of Japan, newly established in 2007

to manufacture auto seats and parts and other equipment for vehicles. Its factory is at Amata City Industrial Estate,

Amphoe Pluak Daeng, Rayong Province.

The Company’s group policy is for each subsidiary to strive to operate profitably in its own right and to be self-sufficient

in its particular activities within the overall policy of the parent.

Breakdown of Total Revenues, Thai Rung Union Car Plc and Subsidiaries, 2010-2012Unit: Million Bt.

Sales and service Performed by% of shares

held

2010 2011 2012

Million Bt % Million Bt % Million Bt %

Revenue from vehicle assembly and other vehicle-related contract work

TRU1,123.26 52 1,116.10 49 2,100.68 56

Revenue from the produc-tion of vehicle manufactur-ing equipment

TRU, TAP, TRT 91, 94 584.82 27 763.67 34 1,280.34 34

Revenue from sales of vehicles and from service centres

TRU, TVS, TUC 94, 99.53* 262.13 12 175.01 8 118.56 3

Total revenue from Sales & service 1,970.21 92 2,054.78 91 3,499.58 93

Other income 178.82 8 208.32 9 281.26 7

Total Revenues 2,149.03 100 2,263.10 100 3,780.84 100

* TRU holds 94% of the shares in TVS, which in turn holds 99.53% of the shares in TUC.


In�u�tr� tren�� an� �uture �o� pet�t��e ��tuat�on

The dynamic of automotive Industry which the global economic center is shifting from West to East. Asia plays an

increasingly important role as an increasingly important market and a major global production base. Apart that, the

coming into force of the ASEAN Economic Community (AEC) in 2015 will stimulate growth in this industry as well as

the relocation of more automakers from Japan and Europe to this region. As a result, the business operators must

adapt themselves to cater the growth and intense competition.

The Company’s management strategy in 2013 will continue to focus on OEM, contract assembly and painting and

vehicle modification, as well as expanding parts making for agricultural machinery. The Company will also continue

to seek alliances to expand its existing business and develop new ones. Furthermore the Company has boosted

its potential, both by increasing production capacity and by improving efficiency by investing in new machines and

introducing innovative technology to the production process, as well as developing human resources to cater to any

foreign trade and investment.


The Company attaches importance to applying the principles of risk management as a tool in managing the

organisation to world standards. A Risk Management Committee is responsible for overseeing and controlling compliance

with risk management policies and rules, monitoring any significant risks that arise and taking steps to ensure that

the organisation has in place risk management systems that are adequate and appropriate to its business and enable

it to meet its objectives. The Company has established a risk management plan which is continuously aligned with

its strategic and business plans, examples being the revision of practical manuals to keep them up to date and thus

able to support improvement drives throughout the organisation, the establishment and review of clear roles, duties

and responsibilities of executives and employees and continuous performance evaluation aimed at incentivising

employees and boosting efficiency.

In 2012 the Company had to increase its production capacity to cater to the greatly increased volumes of work,

particularly for contract vehicle assembly, EDP dip and painting of Nissan pick-ups. The Company paid attention to

the risks associated with possible effects of both atmospheric and noise pollution and made determined efforts to

solve these problems, establishing a policy to invest several million baht in improving the efficiency of the EDP and

painting processes and installing systems to protect against paint dust and odour in accordance with international

standards. The Company has obtained, and maintains, ISO 14001 quality certification, which involves regular checks

by a government-approved company on the various kinds of pollution associated with the production process. The

Company also has a system of checks, improvements, repairs and maintenance for its machinery and production

systems at regular intervals. Accordingly the Company is confident that the production systems in the paint dip and

paint shop facilities are efficient and will not cause environmental problems.

1� Bu��ne�� R��

1.1 Multi-purpose vehicles

Brand owners who already produce multi-purpose vehicles, and new entrants attracted into the market

by the high value of the station wagon type segment.

the implementation of free trade under AFTA coming into effect from 1 January 2010 brings import duty

down to zero, increasing opportunities for foreign brands to establish themselves in the Thai market, which

would increase competition.

higher oil prices have increasingly focused the market’s attention on small cars that use alternative

energy sources and/or are fuel efficient, which could have an impact on the pick-up truck market and the

Company’s multi-purpose vehicle business.

Risk Factors


In order to spread the risk and mitigate any effect that might arise from the various risk factors in the multi-purpose

vehicle business the Company has established guidelines as follows:

The Company focuses on the area of multi-purpose vehicle research and development, striving for modern

features and quality in line with its target customer groups’ needs. The Company has also conducted

studies on developing a business for various kinds of special purpose vehicles such as TR Transformers,

TR exclusive limousine Military Utility Vehicle 4 (MUV4), rapid emergency vehicles in order to expand its

market and its target customer groups, taking advantage of its flexibility in terms of adapting its production

processes.

The Company held events and road shows in various provinces to present its products and public relations

through various media in order to increase sales opportunities. Apart from this emphasis was also given

to sales to government departments.

The Company put additional measures in place throughout the organisation to reduce costs and save on

expenses, both in the factory and in sales and support areas, so as to streamline costs so as to be able

to compete and survive the economic crisis.

1.2 Auto Parts and Contract Assembly

The implementation of free trade under AFTA coming into effect from 1 January 2010 brings import duty down to zero

and thus increases manufacturers’ options in terms of importing parts instead of having them made in Thailand. Thai

auto parts makers are faced with tougher competition on price and quality, from both domestic and foreign producers.

In order to spread the risk and mitigate any effect that might arise from the various risk factors in the parts making

and contact assembly business the Company has established guidelines as follows:

The Company continues to foster its relationships with its long-standing major customers, whilst at the

same time seeking new customers from other sectors such as premium level motorcycles, which is a niche

market with high added value, parts for construction tools, industrial and agricultural machinery, or other

businesses beyond the auto industry such as electronic components, and also to broaden the customer

base to other countries such as China, India and Australia so as to spread the risks in terms of sources

of work. It also arranges programmes of marketing activities aimed at enhancing customer relations in

general throughout the year, as well as establishing new target customer groups every year.

We provide a one stop service for plastic parts, painting, contract assembly and modification work from

research and design through to finished parts.

The Company is always on the look out for possible foreign business alliances with a view to increasing

its know-how in the areas of production technology and more efficient machinery so as to prepare for the

future, and to joint investment and expanding into additional related businesses, its policy being to seek


work with high added value.

The Company is constantly developing new products and production processes in response to government

policy and growing customer requirements.

As a result of the rapid growth in the Thai automotive industry, many automakers find themselves with insufficient

capacity. This present opportunities for the Company to win additional contract assembly and painting

work. The Company has therefore decided to expand its production capacity further. And is currently

studying the possibility of investing to build a new paint shop to cater to the growing demand

1.3 Dies and Jigs

We expect the domestic die and jig making business to improve in 2013 in view of the various forthcoming new

models. However the Company still aims to find work from overseas, from automakers moving their production

bases to Thailand, and from new customers such as makers of construction, industrial or agricultural machinery.

In order to spread the risk and mitigate any effect that might arise from the various risk factors in the die and jig

making business the Company has established guidelines as follows:

The Company has carried out investments to improve the efficiency of the production process so as to

meet the many and varied customer requirements and at the same time to improve chances of winning

the big size of die that have the high value added and less competitor.

The Company has a project to increase automation of the production process so as to lessen the impact

of shortages of skilled labour, and has also arranged training courses aimed at enhancing personnel

capability.

To build dies and jigs on a tier-two basis for tier-one suppliers overseas, e.g. Europe, America, who need

to outsource work to countries with lower production costs.

To provide a one stop service for research, design, modification, right through to dies, jigs and other production

equipment.

Boost level of die and jig design and production for turn-key projects through alliance with foreign partner

so as to be able to enter more overseas tenders

Build up a network of business allies in Thailand so as to cater to the volume of new projects coming on

stream, increase production capacity and be able to take on turn-key projects overseas

Nevertheless in order to spread the risks in all three business units, the Company also strives to diversify its business,

both to reduce the risk of business concentration and to broaden the revenue base. Examples are:

Expanding the business to include the production and sale of vacuum mould plastic parts including

plastic accessories under the name “Parto”, a proprietary brand owned by the Company, including

growing sales on an OEM basis, so as to respond comprehensively to customers’ needs.


The Company is a leader in the design and development of flat deck cargo boxes for pick-up trucks, which

it sells to a number of truck makers for distribution in the domestic market ad overseas.

Expanding the business of product design and development to various automakers at home and abroad

2� ��nan��al R��

2.1 Credit risk

The Company and subsidiaries are exposed to credit risk primarily with respect to trade accounts receivable, loans,

and other receivables. The Company and subsidiaries manage the risk by adopting appropriate credit control policies

and procedures and therefore do not expect to incur material financial losses from granting credit. In addition, the

Company and its subsidiaries do not have high concentrations of credit risk since they have a large customer base.

The largest possible amount that the Company and its subsidiaries could lose from granting credit is the sum of the

carrying amounts of customer receivables, lending and other receivables as shown in the balance sheet.

2.2 Interest rate risk

The Company’ and subsidiaries’ exposures to interest rate risk relate primarily to their cash at banks, current investments

and short-term loans. However, since most of the Company’s and subsidiaries’ financial assets and liabilities have

been repaid within one year, the interest rate risk is expected to be minimal.

2.3 Exchange rate risk

A subsidiary has significant exposure to exchange rate risk arising from sales or purchases denominated in foreign

currency. The subsidiary has managed this risk by putting forward exchange contracts in place, the majority of them

at terms of not more than one year.

Please refer to details in Note 28 to the Financial Statements for the year ended 31 December 2012.

3� Le�al r��

This concerns the risk of being sued by consumers on grounds of product quality and possibly having to pay damages

under product liability legislation as result of auto parts made by the Company being used to assemble vehicles for

sale domestically or abroad. A customer could sue a distributor for damages caused by a faulty vehicle, and if it

could be shown that the problem was caused by a defective part made by the Company, we could in turn be sued

for damages, and depending on the court’s decision might suffer loss as a result.


The Company takes this risk seriously and consequently trains senior executives and personnel on points of law

and enforces strict compliance with the ISO/TS 16946 quality standard so as to ensure that production processes

are efficient, traceable and auditable, right up to pre-delivery inspection so as to guarantee that customers receive

quality product. The target claim rate is zero.

�� a�et�� en��ron� ental an� �o� � un�t� r��

The Company attaches importance to its human resources and stakeholders, striving to manage its business in such

a way as to reduce all kinds of risks that affect people’s quality of life, as well as fulfilling its responsibilities towards

society and building good relations with its neighbouring community, through the following measures:

Annual review of safety and environmental policies and quarterly activity meetings to inform supervisors

of monitoring results

Stress on employee awareness of and attention to safety and environmental issues, all employees being

obliged to follow the CCCF (Completely Check, Completely Find Out) procedure and the ISO14001

environmental management standard, as well as other activities such as “White Factory” “Drive Safely”,

“Don’t Drink and Drive” and “Give up Alcohol for Lent”.

Annual scholarship awards to children of employees who achieve a certain standard.

The Company supports society by donating money, supporting various departments and the local community,

for example donating medical equipment to hospitals, granting scholarships to pupils of various schools, arranging

volunteer programmes in support of underprivileged communities in various parts of the country, volunteer traffic

activities, anti-drugs campaigns, cooperation with government departments, etc.


��are�ol�er�

Major Shareholders as at 5 February 2013, last date on which the share register was closed.

No. Name Shares% of total

shares

1. Dr. Pranee Phaoenchoke 246,387,500 49.12%

2. Mr. Sompong Phaoenchoke* 35,872,000 7.15%

3. Ms. Kaewjai Phaoenchoke 32,639,450 6.51%

4. Mr. Wuttichai Phaoenchoke 31,201,500 6.22%

5. Citibank Nominees Singapore Pte Ltd.-S.A. PBG Clients SG 24,771,925 4.94%

6. Mr. Arnan Tantijarascheb 15,150,000 3.02%

7. Thai Rung Union Car Plc. 9,216,700 1.84%

8. Tisco Securities Co., Ltd. 9,000,000 1.79%

9. Mr. Wongwaris Phaoenchoke 9,000,000 1.79%

10. Mr. Pattanasorn Phaoenchoke 8,657,100 1.73%

TOTAL 421,896,175 84.11%

Note * Mr. Sompong Phaoenchoke holds 27,622,000 shares, his wife Mrs. Kaewkao Phaoenchoke holds 2,250,000 shares

and his minor child Mr. Korrawut Phaoenchoke holds 6,000,000 shares.

Mana�e� ent

1� Mana�e� ent �tru�ture

1.1 Structure of Company’s Board of Directors

The Company has the following five boards and committees: Board of Directors, Audit Committee, Executive Committee,

Risk Management Committee and Nomination and Remuneration Committee, each committee having the powers

and duties as follows:

Shareholders and Management


1) Powers and Duties of the Board of Directors

1. To carry out its duties in accordance with the Company’s laws, objectives and regulations, including resolutions

of shareholders’ meetings, in accordance with the law, with integrity, ethically, prudently and with due regard

to the Company’s best interests.

2. To arrange for a shareholders’ meeting to be held at least once a year, to report to shareholders on the

Company’s performance and to seek shareholders’ approval for matters which exceed the authority or duties

of the board of directors.

3. To hold a meeting of the Board of Directors at least once every three months.

4. To take all necessary steps to ensure that financial and other information provided to shareholders is at all

times correct, complete and transparent.

5. To ensure that the Company has efficient internal control and audit systems in place.

6. To consider and make decisions on important matters such as policies, business plans, administrative powers,

large investment projects, related party transactions, acquisitions or disposals of assets of the listed company

as covered by the regulations of the Stock Exchange of Thailand, and any other matters stipulated by law.

7. To ensure that the Company’s business dealings are carried out in an ethical manner.

8. The Board of Directors may delegate its powers and duties to one of more Directors or to other individual (s)

as it sees fit, authorizing such person or persons to act on its behalf with whatever powers and duties it may

chose to assign.

9. The Board of Directors has the power to appoint and to change authorised signatories empowered legally to

bind the Company on its behalf.

10. To consider the payment of interim dividends to shareholders.

11. To establish the Company’s policies and working guidelines and to monitor administrative departments’

efficient and effective implementation of such policies with a view to maximizing growth and economic value

for shareholders.

12. To give advice to the Managing Director on administration and on decisions likely to have important consequences

for the Company.

13. To avoid conflicts of interest amongst Company stakeholders.


The scope of the powers and duties mentioned shall not extend to:

1. Matters subject by law to a resolution of a shareholders’ meeting, such as capital decrease or increase or

amendments to the Company’s Memorandum or Articles of Association.

2. The authorisation of any related party transaction or acquisition or disposal of listed Company’s assets, which

require approval by a meeting of shareholders in accordance with the regulations of the Stock Exchange of

Thailand.

3. The authorisation of any transaction in which a Director is an interested party or has a conflict of interest,

which requires approval by a meeting of shareholders.

2) Powers and duties of the Audit Committee

1. To ensure that the Company’s financial reporting is accurate and adequate.

2. To ensure that the Company’s internal control and internal audit systems are appropriate and effective, to

consider the independence of the Internal Audit department and to give its opinion on the appointment, transfer

or dismissal of the Head of the Internal Audit Department or such other department as has responsibility for

internal audit.

3. To ensure that the Company operates in accordance with the law relating to securities and the stock exchange

and with regulations of the Stock Exchange and laws relating to the Company’s business.

4. To consider the selection and nomination of independent individuals to perform duties as the Company’s

auditors, and to propose their remuneration; to attend meetings with the auditors, without management

departments being present, at least once a year.

5. To consider related party transactions and transactions likely to give rise to a conflict of interest so as to ensure

that they are conducted in accordance with the law and with regulations of the Stock Exchange of Thailand

so as to provide confidence that such transactions are fitting and proper and in the Company’s best interests.

6. To deliver a report on the Audit Committee’s activities for publication in the Company’s Annual Report, such report

to be signed by the Chairman of the Audit Committee and must contain at least the following information

(a) Its opinion on the accuracy, completeness and reliability of the Company’s financial statements

(b) Its opinion on the adequacy of the Company’s internal control systems

(c) Its opinion on the Company’s compliance with the law relating to securities and the stock exchange and

with regulations of the Stock Exchange and laws relating to the Company’s business

(d) Its opinion on the suitability of the auditors

(e) Its opinion on likely to give rise to a conflict of interest

(f) The number of times the Audit Committee has met, together with individual attendance details

(g) Its opinion or general observations based on the performance of its duties as per its charter

(h) Any other matters that it considers shareholders and investors generally should know within the scope of

action, duties and responsibilities assigned to it by the Company’s Board of Directors.


7. To carry out any other duties assigned to it by the Company’s Board of Directors with the agreement of the

Audit Committee

3) Powers and Duties of the Executive Committee

1. To control and take care of the general conduct of the Company’s business and perform duties assigned to

it by the Company’s Board of Directors in order to achieve the Company’s objectives.

2. To direct and monitor the successful implementation of policies and working plans assigned by the Company’s

Board of Directors to the various administrative departments.

3. To examine, consider and authorise important and urgent business within the scope of its powers and duties and

monetary limitation determined by the Company’s Board of Directors but in any case not exceeding Bt.400m.

4. To establish financial policies and supervise and monitor the administration of all financial work, including all

business conducted with financial institutions, with a view to optimising efficiency.

5. To consider and authorise transactions within the Company’s scope of business.

6. To perform such other duties as may be assigned by the Company’s Board of Directors.

The scope of the powers and duties mentioned shall not extend to the authorisation of any transaction in which the

executive board or an individual is an interested party or involving a conflict of interest on the part of the executive

board or an individual, nor any related party transaction nor the acquisition or disposal of listed Company’s assets,

in accordance with the regulations of the Stock Exchange of Thailand

4) Powers and duties of the Risk Management Committee

1. To establish a policy and framework for managing the Company’s overall risk situation, covering the various

risks that might affect the Company’s results and reputation.

2. To establish strategies which are in accordance with the Company’s overall risk management policy and which

enable risks to be gauged, monitored, taken care of and kept at appropriate levels, including the setting up

of advance warning systems.

3. To review the adequacy and effectiveness of risk management policies and systems and monitor adherence to

those policies on an ongoing basis so as to enhance the prudence, security and efficiency of the Company’s

overall risk management.

4. The Risk Management Committee has the power to establish and define the roles of sub-committees and

working committees for managing the various kinds of risk as it sees fit, and all such committees shall report

directly to the Risk Management Committee.

5. The Committee is empowered to call for documents and information and to require individuals to provide facts

for consideration so as to be able to achieve its objectives.

6. To communicate with the Audit Committee in order to ensure that risk management systems are in line with

internal controls and in accordance with policies and strategies that have been established.

7. To report to the Board on risks and risk management.


5) Powers and duties of the Nomination and Remuneration Committee

1. To select persons with characteristics appropriate to the position of Company Director using transparent

criteria and considering any names put forward by shareholders for nomination to the Board of Directors.

2. To select persons with characteristics appropriate to the position of Chairman of the Executive Committee

and Managing Director in the event of their being a vacancy, for nomination to the Board of Directors for their

consideration, and to prepare a succession plan for senior executive positions.

3. To set policies, methodology and criteria for establishing Directors’ remuneration fairly and in consonance

with the Company’s results and with each individual’s performance.

4. To consider, review and present proposals for establishing Directors’ remuneration.

5. To present reports and proposals of the Nomination and Remuneration Committee to meetings of the Company’s

Board of Directors for their consideration.

6. To perform such other duties as the Company’s Board of Directors may from time to time assign to it.

1.2 List of names of Company Directors

1) Board of Directors

As at 31 December 2012 all nine positions on the Board of Directors were occupied as follows.

Name Position

1. Dr. Pranee Phaoenchoke Chairman of the Board

2. Mr. Pricha Attavipach Independent Director and Deputy Chairman of the Board

3. Mr. Sompong Phaoenchoke Director

4. Ms. Kaewjai Phaoenchoke Director

5. Mr. Wuttichai Phaoenchoke Director

6. Mr. Kavee Vasuvat Independent Director

7. Mr. Suvait Theeravachirakul Independent Director

8. Mr. Somkiat Nimrawee Independent Director

9. Mr. Damri Tunshevavong* Independent Director

Mr. Sakchai Komgris Company Secretary and Secretary to the Board of Directors

* Note: Mr. Damri Tunshevavong was appointed a Director to replace Mr. Anthony Farquhar McDonald

who resigned from his position as Director effective 28 February 2012


Quorum for Board Meetings

1. A quorum for a meeting of the Board of Directors is constituted by not less than half the total number of Board

of Directors.

2. Resolutions are passed by a simple majority of votes by Directors present, each Director having one vote.

3. At each Annual General Meeting of the Company at least one third of the Directors, or if the number of Directors

is not divisible by three then the nearest number to one third, must retire, the longest serving Directors retiring

first. Directors retiring by rotation may be re-appointed for a further term of office.

2) Audit Committee

As at 31 December 2012 the Company’s Audit Committee was composed of three independent directors as follows:

Name Position

1. Mr. Pricha Attavipach Chairman of the Audit Committee

2. Mr. Kavee Vasuvat Member of the Audit Committee

3. Mr. Suvait Theeravachirakul Member of the Audit Committee

Mr. Phakkawat Suwanmajo Secretary to the Audit Committee

Members of the Audit Committee serve for a term of two years. A quorum for a meeting of the Audit Committee is

constituted by not less than half the total number of Committee Members. Resolutions are carried by the affirmative

votes of not less than half the total number of Members present.

3) Executive Committee

As at 31 December 2012 the Company’s Executive Committee consisted of five Directors, as follows:

Name Position

1. Dr Pranee Phaoenchoke Chairman of Executive Committee

2. Mr Sompong Phaoenchoke Managing Director

3. Ms Kaewjai Phaoenchoke Member of Executive Committee

4. Mr Wuttichai Phaoenchoke Member of Executive Committee

5. Mr Somkiat Nimrawee Member of Executive Committee

Mr. Sakchai Komgris Secretary to the Executive Committee

Directors on the Executive Committee serve for a term of three years. A quorum for a meeting of the Executive

Committees is constituted by not less than half the total number of Directors. Resolutions are carried by the affirmative

votes of not less than half the total number of Directors present.


4) Risk Management Committee

As at 31 December 2012 the Company’s Risk Management Committee was composed of six members, as follows:

Name Position

1. Mr. Sompong Phaoenchoke Chairman of the Risk Management Committee

2. Mr. Somkiat Nimrawee Member of the Risk Management Committee

3. Mr. Suvait Theeravachirakul Member of the Risk Management Committee

4. Mr. Sakchai Komgris Member of the Risk Management Committee

5. Mr. Chawan Ngamwongsakolert* Member of the Risk Management Committee

6. Mr. Phakkawat Suwanmajo Member of and Secretary to the Risk Management Committee

* Note: Chawan Ngamwongsakolert was appointed a Director to replace Mrs. Kaewkao Phaoenchoke who resigned from

her position as committee, effective 13 November 2012.

Members of the Risk Management Committee serve terms of two years. A quorum for a meeting of the Risk

Management Committee is constituted by not less than half the total number of Members. Resolutions are carried

by the affirmative votes of not less than half the total number of Members present.

5) Nomination and Remuneration Committee

As at 31 December 2012 the Company’s Nomination and Remuneration Committee was composed of three independent

directors as follows:

Name Position

1. Mr. Pricha Attavipach Chairman of the Nomination and Remuneration Committee

2. Mr. Kavee Vasuvat Member of the Nomination and Remuneration Committee

3. Mr. Somkiat Nimrawee Member of the Nomination and Remuneration Committee

Mr. Sakchai Komgris Secretary to the Nomination and Remuneration Committee

Members of the Nomination and Remuneration Committee serve terms of two years. A quorum for a meeting of the

Remuneration Management Committee is constituted by not less than half the total number of Members. Resolutions

are carried by the affirmative votes of not less than half the total number of Members present.


Directors’ signing powers

Directors’ signatory powers to bind the Company as recorded in the Company’s registry. At present such powers

are as follows:

Any one of the following Directors, acting alone, may bind the Company with his or her signature and the Company

seal:

1. Dr. Pranee Phaoenchoke

2. Mr. Sompong Phaoenchoke

3. Ms. Kaewjai Phaoenchoke

4. Mr. Wuttichai Phaoenchoke

(Memorandum of Association amended 16 March 2012)

1.3 Criteria for Appointment of Independent Directors

The selection process for Independent Directors can be seen in the heading concerning criteria for selection of

Directors and Administrators. Independent Directors must have qualities in accordance with the Company’s definition

of Independent Director which in turn is in accordance with that of the SEC, as follows.

Characteristics and definition of independent director of Thai Rung Union Car Plc.

1. Does not hold more than 1% of the total number of voting shares in the parent Company, or of any of its

subsidiaries or joint venture companies or in any entity likely to give rise to a conflict of interest, shares held

by related persons to be included in the calculation in accordance with directive 258 of the Securities Act.

2. Does not take part in administering the work, is not a contractor or an employee or consultant in receipt

of a regular salary and is not in a position to exert control over the Company, its subsidiaries, joint ventures

or fellow-subsidiaries or on any entity likely to give rise to a conflict of interest (at present, and in the two

years prior to his appointment.)

3. Does not have business dealings with the Company:

3.1 Is not an auditor of the Company.

3.2 Does not provide other professional services to the Company such as legal or financial consultancy

or appraisal worth more than Bt.2m per year.

3.3 Does not have habitual related party transactions by way of rent or lease, whether as lessor or lessee,

of real estate, or concerning assets/services or the receipt or provision of financial assistance with a value

exceeding Bt.20m or 3% of NTA, whichever is the lower, including transactions carried out in the one year

prior to the carrying out of any given transaction.


He must not have business relations as defined in 3.1 to 3.3 above at present, nor in the two years prior

to his appointment except where there is necessary and proper reason and in any case not continuously

or constantly. An Independent Director or Audit Committee Member may have relations that go beyond

those stipulated while performing his office, but only after obtaining the unanimous prior approval of the

Company’s Board of Directors and subject to the relationship being disclosed per Form 56-1, in the Annual

Report and in the letter of invitation to the Shareholders’’ Meeting in the event that the Shareholders’

Meeting is to be asked to renew the term of office of the Independent Director or Audit Committee Member

concerned.

4. Is not related by blood or marriage to (i.e. is not the father, mother, spouse, sibling or child of or the spouse

of a child of an Administrator, major shareholder or other person in a position of authority or candidate as

Administrator or person in a position of authority of the Company or any of its subsidiaries.

5. Has not been appointed to represent a Director or major shareholder or other shareholder that is a related

party to a major shareholder.

6. Does not have any other characteristic limiting his independence.

7. An Independent Director having the characteristics set out in points 1 to 6 above may be given powers by the

Board of Directors to decide on matters involving the Company, its subsidiaries, its joint ventures or fellow-

subsidiaries or entities likely to have a conflict of interest on a collective decision basis

1.4 Number of Board Meetings held and individual Directors’ attendance record

The following table shows a summary of the number of meetings held in 2012-Board meetings, meetings of Board

Committees and Meetings of Shareholders-and individual Directors’ attendance record.

Meeting attended / Meeting Held

NameCompany Board of Directors

Executive Committee

Audit Committee

Nomination and

Remuneration Committee

Risk Management Committee

Attendance at Share-holders’ Meetings

1. Dr. Pranee Phaoenchoke 4/4 3/3 - - - 0/1 2. Mr. Sompong Phaoenchoke 4/4 3/3 - - 4/4 1/1 3. Ms. Kaewjai Phaoenchoke 1/4 3/3 - - - 1/1 4. Mr. Wuttichai Phaoenchoke 2/4 3/3 - - - 1/1 5. Mr. Damri Tunshevavong/1 2/3 - - - - 1/1 6. Mr. Somkiat Nimrawee 3/4 3/3 - 2/2 3/4 1/1 7. Mr. Pricha Attavipach 4/4 - 4/4 2/2 - 1/1 8. Mr. Kavee Vasuvat 4/4 - 4/4 2/2 - 1/1 9. Mr. Suvait Theeravachirakul 4/4 - 3/4 - 4/4 1/110. Mrs. Kaewkao Phaoenchoke/2 - - - - 2/3 -11. Mr. Sakchai Komgris (Secretary) 4/4 3/3 - 2/2 4/4 1/112. Mr. Phakkawat Suwanmajo - - - - 4/4 -

* Note: 1. Mr. Damri Tunshevavong was appointed a Director to replace Mr. Anthony Farquhar McDonald who resigned from his

position as Director effective 28 February 2012.

2. Mrs. Kaewkao Phaoenchoke resigned from member of the risk management committee, effective 12 November 2012


1.5 Company Administrators

As at 31 December 2012 The Company’s Administrators as per the SEC definition were as follows:

Name Position

1. Dr. Pranee Phaoenchoke President

2. Mr. Sompong Phaoenchoke Managing Director

3. Mr. Somchai Kirtitilaka Deputy Managing Director

4. Mr. Wuttichai Phaoenchoke Assistant Managing Director, Research & Development line

5. Mr. Sakchai Komgris Assistant Managing Director, Administration line and Company Secretary

6. Mr. Chawan Ngamwongsakollert General Manager for Accounting and Finance

7. Mr. Lim Wee Ern General Manager for export sale

Managing Director’s Powers and Duties

1. To control and oversee the pursuance of the Company’s business in general and to perform duties assigned

by the Company’s Board of Directors or Executive Committee, ensuring that objectives are met.

2. To follow up and monitor the implementation of policies and working plans, ensuring that the administrative

departments concerned duly perform the various tasks assigned them by the Company’s Board of Directors

or Executive Committee, with the desired results.

3. To consider and, if appropriate, approve important and urgent transactions within the scope of his powers

and duties and such monetary limits as the Company’s Board of Directors may establish, up to a maximum

of Bt.200 million.

4. To control and oversee financial administration, including dealings with financial institutions, ensuring that it

is in accordance with financial policies and as efficient as possible in accordance with assignments from the

Company’s Board of Directors or Executive Committee.

5. To consider and, if appropriate, approve business transactions within the Company’s authorised areas of

business.

6. To perform such other duties as may be assigned by the Company’s Board of Directors or Executive

Committee.

The scope of the powers and duties mentioned shall not extend to the authorisation of any transaction in which the

Managing Director or an individual with a possible conflict of interest is an interested party or where there is a conflict

of interest regarding the benefits of a related party transaction, or the acquisition or disposal of the listed Company’s

assets, in accordance with the regulations of the Stock Exchange of Thailand.


1.6 Business dealings or professional services between Independent Directors and the Company

During the year 2012 no Independent Director had any business relations with or provided professional services

to the Company, its subsidiaries or joint ventures or juristic persons with possible conflicts of interest for a value

exceeding that stipulated in the SEC’s recent announcement regarding application for and granting of authorisation

to offer new shares for sale.

2� No� �nat�on o� D�re�tor� an� A�� n��trator�

The Company appointed a Nomination and Remuneration Committee on 13 August 2009, assigning additional powers

and duties relating to nomination to the members of the existing Remuneration Committee (details of scope of powers

and duties of the Committee can be seen under the heading Structure of Company Boards and Committees.)

In the process for selecting individuals to be appointed as Directors includes, Independent Director and Company

Administrators consideration of a number of characteristics including skills, experience and capability, especially in

areas that are of the greatest benefit to the Company, and integrity. In fairness to shareholders Independent Directors

must have qualities in accordance with the Company’s definition of Independent Director which in turn is in

accordance with that of the SEC (details of the Company’s definition of Independent Director can be seen under the

heading concerning criteria for selection of Independent Directors) each individual should be able to dedicate the

necessary time to attending board meetings on a regular basis, and thus no individual should hold directorships of

several listed companies at same time. Finally the individual must not possess any of the qualities or characteristics

prohibited by the Listed Companies Act.

The Company has extended the opportunity to shareholders to put forward suitable names to be considered for

nomination as Directors of the Company in advance, in accordance with criteria laid down by the Company and

published through the SET and the Company’s website, for the Nomination and Remuneration Committee to first

consider the qualities of those put forward as possible Directors or Independent Directors of the Company, prior to

submitting selected names to the Company’s Board of Directors, which in turn proposes appointments to the General

Meeting of Shareholders. Approval is by simple majority of votes of those shareholders present or duly represented

at the meeting and in possession of voting rights, as follows:

1. Each share confers the right to one vote.

2. Each shareholder who votes must use all his votes as per (1) above for a single individual or for a number of

individuals together, but may not allocate votes individually.

3. The individuals receiving the highest number of votes will be selected in descending order for appointment

as Directors of the Company depending on the number of Directors to be appointed on each occasion. In

the event that two candidates receive the same number of votes and that appointing them both would lead

to exceeding the required number of Directors, the Chairman of the meeting shall exercise a casting vote.


3� D�re�tor�� an� A�� n��trator�� Re� unerat�on

3.1 Monetary remuneration

(a) Board of Directors

Total remuneration received by all ten Directors from the Company in their capacity as Directors by way of Directors’

stipends and meeting fees in 2012 a total of Bt.5,845,000 Details are as follows:

Director’s Name 2012 (Baht) 2011 (Baht)

1. Dr. Pranee Phaoenchoke 940,000 720,000

2. Mr. Sompong Phaoenchoke 780,000 560,000

3. Ms. Kaewjai Phaoenchoke 635,000 490,000

4. Mr. Wuttichai Phaoenchoke 600,000 440,000

5. Mr. Pricha Attavipach 835,000 710,000

6. Mr. Kavee Vasuvat 545,000 390,000

7. Mr. Suvait Theeravachirakul 530,000 400,000

8. Mr. Somkiat Nimrawee 530,000 420,000

9. Mr. Damri Tunshevavong 430,000 -

10. Mr. Anthony Farquhar McDonald 20,000 340,000

Total 5,845,000 4,470,000

* Note: Mr. Damri Tunshevavong was appointed a Director to replace Mr. Anthony Farquhar McDonald who resigned from his

position as Director effective 28 February 2012.

(b) Administrators (excluding Directors)

2012 2011

Number of persons Total Amount (Baht) Number of

persons Total Amount (Baht)

Salaries/1 8/2 15,982,792 7 14,805,860

Annual remuneration/1 8/2 5,413,405 7 3,389,395

Living Allowances 8/2 619,431 7 602,460

Company Secretary’s position allowance 1 84,000 1 84,000

Total 22,099,628 18,881,715

Notes: 1. The monthly and annual remuneration of the President and the Managing Director have been considered by the Nomination

and Remuneration Committee and approved by the Company’s Board of Directors.

2. One Administrator starts his position on March 2012 and one administrator retired on October 2012


3.2 Non-monetary remuneration

(a) Directors

None

(b) Administrators

Company car

Dividend Policy of Company and Subsidiaries

(a) Payment of dividends by the Company to Shareholders

TRU’s dividend policy is to pay a dividend each year of approximately 40% of its consolidated net earnings of the

previous year, subject to TRU and its affiliates’ cash flow and investment plans, and other future considerations as

to necessity and appropriateness

(b) Payment of dividends by Subsidiaries to the Company

Subsidiary companies Thai Rung Tools and Dies Co., Ltd. Thai V.P. Auto Service Co., Ltd. Thai Auto Pressparts

Co., Ltd. and Thai Ultimate Car Co., Ltd. consider their policy year by year in light of their investment requirements

and other circumstances as appropriate.

Auditors’ Remuneration

a) Audit fees

Audit fees paid to ANS Audit Co., Ltd. by the Company and its subsidiaries in 2012 were as follows, with

comparative figures for 2011

Baht

Company 2012 2011

Thai Rung Union Car Plc. 592,800 570,000

Thai V.P. Auto Service Co., Ltd. 235,000 230,000

Thai Rung Tools and Dies Co., Ltd. 205,200 200,000

Thai Auto Pressparts Co., Ltd. 270,000 250,000

Thai Ultimate Car Co., Ltd. 361,000 350,000

Total 1,664,000 1,600,000


b) Non-audit fees

Non-audit fees paid to ANS Audit Co., Ltd. by the Company and its subsidiaries in 2012 were as follows, with

comparative figures for 2011.

Baht

Item Payer 2012 2011

Other service charges* Company 76,516 67,560

Other service charges* Subsidiaries 118,100 61,710

Special service fees in accordance with

BOI instructions

Thai Auto Pressparts Co., Ltd. 41,600 40,000

Total 236,216 169,270

Notes: Other service charges such as travelling, accommodation, telephone and photocopying expenses, cost of binding for

Financial Statements, files, etc., invoiced as incurred.


1 Relate� Part� Tran�a�t�on � �t� ent�t�e� �a��n� a po��le �on�l��t o� �ntere�t

Transactions during the past year with parties having possible conflicts of interest

Related company Main type of BusinessThai Rung Group

Counterparty

Related Party Transactions 2012

(Baht millions)

Balance sheet item

(Baht millions)

Isuzu Chaicharoenkij Motor Co., Ltd.

Isuzu dealer Sale of spare parts After-sales

service

TRU, TVS, TUC

TVS

TVS

Purchase of spares,vehicle repairs Sale of spare parts Public utlity charge and administration fee

1.16 0.56 1.91

Trade debtors other debtors Trade creditors Other creditors

0.98 0.62 0.05 0.30

Chaicharoenkij Motors Co., Ltd.

- TUC Cost of leasing land 0.28

Firstpart Co., Ltd. Sale of spare parts & accessories, Auto repair

& maintenance

TVS Purchase of spares, vehicle repairs

0.03

V.P. Auto Enterprise Co., Ltd.

Ford dealer Sale of spare parts After sales service

TVS, TUC

TVS

TUC

TVS, TUC

Purchase of spares and payment for service Sale of spare parts Income from rental of land and showroom Income from utility charges and administartion fees

1.64

0.01 0.60

0.52

Trade debtors Trade creditors Other creditors

0.06

0.73-

VPK Auto Co., Ltd.

Ford dealer Sale of spare parts After sales service

TRU

TRUCost of leasing land Public utlity charge and administration fee

0.200.03

Trade creditors 0.01

Thai V.P. Corporation Co., Ltd.

Vehicle rental TRU, TRT, TAP, TVS

TVS

TUC

TRU, TVS, TUC

Vehicle rental Sale of spare parts Income from rental of land and showroom Income from utility charges and administartion fees

3.46 0.04 1.78

0.74

Trade debtors Other debtors Trade creditors Other creditors

0.01 0.17 0.07 2.53

Phothiphoom Co., Ltd.

Real estate TUC Cost of leasing land 1.20 other creditors 0.10

Lexus Auto City Co., Ltd.

Lexus dealer TUC

TVS

TRU

Income from lease of land and showroom Income from utility charges and administartion fees Repair vehicle

1.89

0.01

0.14

Trade debtors Other creditors

0.16 0.08

Note:

Thai Rung Tools and Dies Co., Ltd. TRT Thai V.P. Auto Service Co., Ltd. TVS

Thai Auto Pressparts Co., Ltd. TAP Thai Ultimate Car Co., Ltd. TUC

Related Party Transactions


Nature of relationships

1. TRT, TVS and TAP are subsidiaries of TRU, in which the Phaoenchoke group hold directorships and are the major shareholders.

2. TUC is a subsidiary of TVS, which holds 99.53% of the shares, the Phaoenchoke group holding the remaining 0.47%.

3. The above listed companies having possible conflicts of interest are related companies in which members of the Phaoenchoke

group are both directors and major shareholders as follows:

Related CompaniesShares held by Directorship in Related Companies

Phaoenchoke group ICCK TVP Others Dr. Pranee Mr.Sompong Ms.Kaewjai Mr.Wuttichai

Isuzu Chaicharoenkij Motors Co., Ltd.

100.00% - - - C D D D,MD

Chaicharoenkij Motors Co., Ltd.

100.00% - - - C D D D,MD

Firstpart Co., Ltd. 100.00% - - - C D D,MD -

V.P. Auto Enterprise Co., Ltd. 0.20% - 99.80% - C D D,MD D

VPK Auto Co., Ltd. 0.00% - 82.00% 18.00% C - D,MD -

Thai V.P. Corporation Ltd. 100.00% - - - C D D,MD D

Phothiphoom Co., Ltd. 100.00% - - - C D D D,MD

Lexus Auto City Co., Ltd. 90.00% - - 10.00% C D - -

Note:

1. “Phaoenchoke group” consist of Dr. Pranee Phaoenchoke, Mr. Sompong Phaoenchoke, Ms. Kaewjai Phaoenchoke and

Mr. Wuttichai Phaoenchoke

2. ICCK = Izusu Chaicharoenkij Motor Co., Ltd., TVP = Thai V.P. Corporation Ltd.

3. C = Chairman of the Board D = Director MD = Managing Director or CEO


2 Ne�e��t� an� Propr�et� o� Relate� Part� Tran�a�t�on�1. Buying and selling accessories and spare parts and providing and receiving vehicle repair services are all

normal business transactions of the Company, performed at cost plus a profit margin.

2. The leasing of land and office and showroom space together with utilities is at prices stipulated in mutual

contracts, which are in line with actual or estimated market prices.

3. Vehicles rented from a related company are for use in the business. Rates and terms are similar to those

applied to unrelated parties.

The above Related Party Transactions were considered with regard to their necessity, appropriateness and overall

benefit to the Company and its shareholders. Most of them were normal business transactions or were in support

of such normal business transactions, and they were conducted on normal commercial terms, without giving rise to

any profit diversion, and were conducted at arm’s-length prices and on similar terms to those applied to non-related

parties. The non-executive Directors’ opinion does not differ in any respect from the relevant resolutions of the Board

of Directors.

3 Pol�� an� approa�� t� re�ar� to �uture Relate� Part� Tran�a�t�on�

As regards any future Related Party Transactions the Company will act in accordance with all relevant laws, and with

all relevant orders, proclamations and regulations of the Stock Exchange of Thailand, including regulations regarding

the disclosure of information on Related Party Transactions and on the acquisition or disposal of significant assets by

the Company or its subsidiaries. The Company’s Board of Directors has established guidelines for the consideration

of related party transactions and of acquisitions and disposals of Company assets as follows

In the event that, the size of the transaction having been calculated in accordance with Stock Exchange of

Thailand criteria it transpires that the transaction requires approval by the Company’s Board of Directors, then

the transaction must be submitted to the Board of Directors for their consideration. In the event that the Audit

Committee disagrees, the proposal can nevertheless be placed before the Board and an appropriate record

made in the minutes.

In the event that, the size of the transaction having been calculated in accordance with Stock Exchange of

Thailand criteria, it transpires that the transaction requires approval by a meeting of shareholders, then the

transaction must first be submitted to the Audit Committee for consideration and, if approved, onward submission

to the Board of Directors who in turn will, if approved, propose it to a meeting of shareholders


Corporate Governance

Principles of corporate governance are guidelines for doing business and administering organisations, which are becoming more and more widely known and accepted. In accordance with these principles the Board of Directors has a very important role to play in running the organisation, by focusing on responsibilities towards all parties with which it has dealings, both inside and outside the organisation, and by emphasizing the importance of ethical dealings, transparency, efficiency, adequate disclosure of information that can be examined, the protection of shareholders’ rights and attention to their remuneration, and responsibilities towards society and the nation. The Company is very well aware of the importance of these guidelines and adheres to them strictly, so as to inspire confidence in shareholders and everyone with whom it has dealings and to form a solid base for the growth of the business.

The Company is committed to applying the principles of corporate governance on an ongoing basis to the running of the Company’s business. Thanks to which the Company was assessed as ‘Excellent’ for the fifth year running in the joint SEC-TIA (Thai Investors Association) ‘AGM check-list’ and as ‘Very Good’ for the fourth year in a row by the Thai Institute of Directors’ ‘Corporate Governance Report of Thai Listed Companies 2012.’ The Company’s

policy is to continue improving the standard of corporate governance.

1. Shareholders’ Rights

The policy laid down by the Company’s Board of Directors is to look after shareholders’ basic rights. The Board considers the equitable safeguarding of the interests of all groups of shareholders to be an important duty and responsibility, in order to ensure that shareholders are treated fairly and that they have confidence in how business

is conducted by the Company and its Directors.

1. The Company’s Board of Directors has established a corporate governance policy in writing, which must be strictly adhered to, as follows.

(1) Rights and equitable treatment of Shareholders and other Stakeholders

The Company deals fairly and impartially with shareholders and other stakeholders such as employees

and contractors, trading partners, the public, competitors, and creditors.

The Company endeavours to arrange shareholders’ meetings at the most convenient times possible for

shareholders and to give shareholders equal opportunities to voice their opinions and ask questions.

(2) Board of Directors - structure, role, duties and responsibilities, independence

The Board of Directors should play a leading role, have vision, and be independent in its decision making,

for the overall maximum benefit of the Company and its shareholders.

The Board of Directors, management and shareholders should consider prudently how best to solve

problems arising through any conflict of interest, with sincerity and integrity, rationally and independently

within the framework of best ethical practice.

Annual Report 2012THAI RUNG UNION CAR PUBLIC COMPANY LIMITED�0

At least one third of the total number of Directors, but in any case not less than three, shall be Independent Directors.

The Board of Directors and the management team have agreed a system for the clear sharing of function,

duties and responsibilities, and the Board has established a number of committees to help it study and

scrutinise work in light of policies and to provide clear monitoring and follow-up. Committees currently

include the Executive Committee, the Audit Committee, the Risk Management Committee and the Nomina-

tion and Remuneration Committee. The Board may consider setting up further committees as and when

appropriate.

Directors are expected to attend all Board meetings. Each year the Company fixes such meeting in advance,

at least one every three months, with additional, special meetings being called as and when necessary.

The Company discloses the number of meetings attended by each Director in its Annual Report.

(3) Disclosure and Transparency

The Board shall perform its duties with transparency, such that its actions can be examined, and shall

disclose of correct and complete information, in a timely manner, to all interested parties. The Company

has appointed the persons to be responsible for communicating with shareholders, institutional investors,

stock analysts, and relevant government departments.

The Company has established a Nomination and Remuneration Committee whose duty is to seek out

people with appropriate qualities to occupy the position of Director, Chairman of the Executive Committee

and Managing Director in the event of a vacancy and to establish Directors’ remuneration fairly and

reasonably. The establishment of Directors’ remuneration is subject to approval by a general meeting of

shareholders, and is published in the Company’s Annual Report.

(4) Control and Management of Risk

The Company attaches importance to the implementation of internal controls and audits, and has

accordingly established an internal audit department to ensure that basic working practices and important

financial transactions are conducted in accordance with established guidelines and in an efficient manner,

reporting direct to the Audit Committee.

(5) Business Ethics

The Company has issued to all Directors, administrators, managers and employees a written code of

ethics to which they must adhere in performing their duties.

2. The Company’s Board of Directors has determined that an Annual General Meeting of Shareholders be held each

year within four months of the close of business of the previous accounting year, and that the Company inform

time, place and agenda of the meeting and provide relevant information and give Directors’ opinion as regards

each agenda item in the letter of invitation to the shareholders’ meeting, which shall be in both Thai and English,

and attach a form of proxy together with explanations as to registration for the meeting and granting of proxy are

sent to shareholders at least fourteen days in advance and posted on the Company’s website beforehand, so as

to give shareholders sufficient opportunity to study the information in advance of the meeting.

Annual Report 2012THAI RUNG UNION CAR PUBLIC COMPANY LIMITED �1

3. The Company’s Board of Directors has established criteria and procedures for extending the opportunity to minority

shareholders to put forward names of suitable individuals to be considered for nomination as Directors of the

Company and to propose agenda items for ordinary general meetings of shareholders in advance, in the period

from October to December each year, in accordance with the criteria laid down by the Company and published

through the SET Community Portal (SCP) and the Company’s website. In addition to this, the Company gives

shareholders the opportunity of querying information relating to agenda items or of submitting questions to the

Company in advance of the meeting by e-mail or fax, to promote shareholders’ opportunities to express their

opinions to the Company.

4. The Company’s Board of Directors treats all its shareholders impartially, endeavours to arrange shareholders’

meetings at convenient and appropriate venues and opens for registration well before the meeting starts, while

shareholders who are unable to attend in person can appoint another person as proxy and can also choose to

appoint one of the Company’s independent directors to act as proxy.

Before the meeting starts, all rules and procedures governing the meeting are announced and clearly explained,

including the method used to count shareholders’ votes on each agenda item. The Company hands out voting

registration cards for each agenda item, while for any proposed appointment of Directors there is a card for each

individual candidate, allowing shareholders to vote on each individual separately if they so wish.

Throughout the meeting shareholders are welcome to express their opinions and to ask questions, all of which

are answered. Complete and accurate minutes are taken of each meeting, which is also recorded on video, and

are made available for shareholders’ inspection.

5. The Company’s Board of Directors attaches great importance to shareholders’ meetings, and all Directors

endeavour to attend every such meeting, particularly the President of the Board of Directors and the Chairmen

of the various committees, so as to facilitate questions and answers on matters relating to each one.

2. Equitable Treatment of Shareholders

The policy of the Company’s Board of Directors is to treat all shareholders equally and fairly so as to safeguard

their basic rights.

1. The Company’s Board of Directors accommodates shareholders who are unable to attend meetings in person,

enabling them to vote by proxy. The Company also makes available the name of at least one independent

Director whom shareholders have the option of appointing as their proxy, and provides as part of the letter of

invitation to the meeting, information on each one, comprising name, age, address, positions held, academic

record, work experience, shareholding in the Company and whether the Director is an interested party with regard

to any particular agenda items. The Company makes available a form of proxy which enables shareholders to

give instructions on how votes are to be cast on each item; however shareholders are free to use any form that

complies with the criteria published by the Department of Business Development of the Ministry of Commerce.


2. The Company’s Board of Directors arranges for voting registration cards to be handed out for each agenda item,

while for any proposed appointment of Directors there is a card for each individual candidate, allowing shareholders

to vote on each individual separately if they so wish, and facilitating transparency and ease of examination in

the event of any subsequent dispute. Information on individuals to be proposed for appointment as Directors is

disclosed in the letter of invitation to the shareholders’ meeting, the information comprising name, photograph,

age, academic record and Directors’ training courses, work experience and shareholding in the Company, for

shareholders to study before reaching a decision.

3. In meetings of the Board of Directors or of shareholders, any Director, Administrator or shareholder who is an

interested party in any agenda item must disclose to the meeting information on his or her own interest and

those of related parties, and will not be entitled to vote on that particular agenda item, so that the meeting can

consider transactions that might involve conflicts of interest and reach decisions in the overall best interests of

the Company.

4. A shareholder who is also an Administrator may not raise any additional agenda item at a meeting of shareholders

unless such item has been communicated in advance, even if the item is not so important as to require shareholders

to spend time studying it before reaching a decision.

5. The Company’s Board of Directors attaches great importance to the safekeeping and protection of confidential

internal information and has therefore established written guidelines for guarding against the use of internal

information for personal benefit. For details please refer to Control of Internal Information.

6. The Board of Directors has resolved that Directors and Administrators who are obliged by law to report their

shareholdings must submit these reports to the Company’s Board of Directors each time. The Board of Directors

has further determined that shareholdings of Directors and Administrators be reported every quarter to the Board.

3. Stakeholders

The Company attaches importance to dealing with all its stakeholders, including shareholders, customers, trading

partners and creditors, competitors, employees, the environment, the community and society with sincerity, honesty

and impartiality.

1. The Company’s Board of Directors has produced and issued to all Directors, Administrators and employees a

written Code of Ethics or Statement of Business Conduct to which they must adhere in performing their duties

in accordance with the Company’s mission, as follows.

Shareholders

The Company attaches great importance to its shareholders and other stakeholders, and carries on its

business with sincerity, integrity and fairness, treating all parties concerned equitably, for the greater benefit

of all concerned.


Employees

The Company is confident that its employees constitute the organisation’s most valuable resource, and

is therefore determined to recruit and look after good people with know-how, capability and integrity, and

also focuses on developing individuals’ potential to help employees advance, while providing them with

appropriate and fair remuneration and various welfare benefits aimed at promoting a cooperative work

atmosphere in which initiative and creativity can thrive to the benefit of the organisation.

Customers

The Company is devoted to and responsible to its customers, supplying them with quality standard goods,

and respecting their confidentiality.

Trading Partners

The Company can demonstrate that its procurement practices are in accordance with commercial conditions

and that its financial borrowings, repayments and guarantee transactions are all in accordance with terms

and conditions agreed with creditors.

Competitors

The Company operates within a framework of fair competition, adhering to best practice principles and

avoiding any unethical practices aimed at harming competitors.

Community and Society

The Company cares about the environment, and takes steps to reduce and avoid creating pollution in its

production processes that could affect the environment or the community, promotes community relations

activities, helps society consistently to the best of its ability, and is always ready to listen to warnings or

suggestions from the community so as to be more environmentally friendly, to improve the state of the

environment and make it more liveable.

2. The Company attaches importance to playing a useful role as regards the community, society and religion, for

example through financial or material donations in support of various charitable organisations, granting scholarships

every year to children of the Company’s employees and pupils of schools located near the Company, supporting

the Buddhist religious clubs in the Company, arranging important religious activities in the Company on an ongoing

basis throughout the year.

3. The Company pays close attention to the health and safety of all its employees concerning its policies on safety

and health at work and the work environment, for all employees to cooperate in strict observance.

4. The Company attaches great importance to its employees, who constitute one of its most important resources. It

has a policy of looking after its employees consistently, and has arranged to provide various appropriate welfare

benefits such as buses to transport workers to and from the factory, a canteen, uniforms, accident insurance,

annual health checks, a clinic and a library.

5. The Company has made arrangements for channels of communication to enable it to receive opinions and

suggestions from all stakeholder groups, with a view to improving and developing its products, services and

organisation, making it stable, able to compete successfully in the on term. One example is the employee

Annual Report 2012THAI RUNG UNION CAR PUBLIC COMPANY LIMITED��

suggestion scheme, in which each employee has a target of six suggestions per year, and suggestions go straight

from the suggestion box to the Managing Director. Another is the facility for customers, shareholders, or the

general public to submit suggestions and recommendations through the Company’s website.

4. Disclosure and Transparency

The Company’s policy as established by the Board of Directors is one of transparency and of complete and timely

disclosure to all interested parties of correct, readily accessible, consistent, reliable and checkable information,

whether financial or non-financial.

1. The Company has set up a ‘Share Register and Investor Relations Department’ within the Office of the Managing

Director, whose duty it is to disclose correct, complete, transparent information, whether financial or of a general

nature, as well as being responsible for communicating with outside parties such as shareholders, institutional

and other investors, analysts and relevant government departments in a fair and equitable manner. Investors can

request further information about the Company by contacting:

Share Register & Investor Relations Department,

Office of the Managing Director

Tel: 0-2420-0076 ext. 321 or 359,

Fax: 0-2812-0844

e-mail: [email protected] or [email protected]

or by visiting the Company’s website: http://www.thairung.co.th

2. The Company has disclosed information in accordance with the criteria established using the Stock Exchange of

Thailand’s SET Community Portal (SCP) system by way of Form 56-1 for the disclosure of annual information,

as well as submitting its Annual Report and disclosing important information in both Thai and English on the

Company’s website.

3. The Board of Directors has disclosed the roles and duties of the Board and of the various Committees and the

number of times each board and committee met during the year and individual attendance records in Form 56-1

for annual information and in the Company’s Annual Report. (For details please refer to Structure of Company’s

Board of Directors and Number of Board Meetings held and individual Directors’ attendance record)

4. In accordance with Section 89/14 of the Securities and Exchange Act and SEC Announcement Thor Jor 2/2009

which came into force on 1 July 2009, the Company requires its Directors and senior executives to report to the

Company any interests of their own or of related persons that relate to their administration or management of

the business of the Company or its subsidiaries in every times that have changed information and at least once

a year, on 1st July of every year, so that the Company shall have the necessary information for proceeding in

accordance with rules regarding related party transactions where conflicts of interest might arise to the detriment

of the Company and its subsidiaries.

Annual Report 2012THAI RUNG UNION CAR PUBLIC COMPANY LIMITED ��

5. Responsibilities of the Board of Directors

The Company’s Board of Directors is well aware of the important role it plays in controlling and monitoring business

for the greatest possible good of the Company, and of its answerability to shareholders for the consequences of its

actions in carrying out its duties. It operates independently from management. Details are as follows.

1. Structure of Company’s Board of Directors

1.1 The Board of Directors of the Company consists of nine persons, at least one third of whom must be independent

directors. At present the Company has five independent directors. The characteristics of independent directors

are as defined by the Company. (details as per heading re criteria for appointment of Independent Directors)

1.2 The Chairman is not the same person as the Managing Director, and the Board of Directors of the Company

has clearly defined the Managing Director’s powers and duties so that no single person has unlimited power.

(For details please see re Company Administrators) This arrangement makes for better checks and balances

and control.

1.3 The Company’s Board of Directors appointed a Company Secretary on 15 May 2008 to perform the duties of

setting up and maintaining a register of Directors, arranging letters calling Board meetings, minutes of Board

meetings, letters of invitation to and minutes of shareholders’ meetings and to keep records of Directors’/

Administrators’ interests and perform such other duties as may be established by securities legislation.

1.4 The Board of Directors of the Company has not so far established on how many company boards each

director can sit, nor has it established clear policies or guidelines on the question of seats on boards of

other companies being occupied by the Managing Director and senior Administrators of the Company. The

Company’s Board of Directors will consider these matters in due course.

2. Other Boards and Committees

2.1 The Board of Directors has established four other boards and committees: the Audit Committee, the Executive

Committee, the Risk Management Committee and the Nomination and Remuneration Committee in order to help

study details and scrutinise work as necessary according to the situation, to lighten the workload of the Board of

Directors, to provide clear arrangements for the consideration of each particular type of subject, and to accord

with good corporate governance practices. (For names of members, powers and duties and other information on

each board and committee please refer to headings re structure of the Company’s Board of Directors and list of

names of Company Directors) The Company does not have a nomination committee but it does have a process

for the selection of directors and administrators in accordance with established methods and criteria. (For details

please see Nomination of Directors and Administrators.)

2.2 The Chairman of the Board of Directors of the Company cannot be a chairman or member of any other board or

committee. The majority of members of other boards and committees are independent directors, including the chairmen

of the Audit Committee and of the Nomination and Remuneration Committee, so as to ensure transparency

and independence in carrying out their duties.


3. Role, Duties and Responsibilities of the Board of Directors

3.1 The Board of Directors plays a part in establishing the Company’s vision, mission and business strategies and also in ensuring independently that administrative departments proceed in accordance with work plans efficiently and effectively for the overall benefit of the Company and its shareholders. In addition the Board establishes internal control systems and an effective internal audit, and constantly monitors them though meetings of the Audit Committee.

3.2 The Board of Directors has established written corporate governance policies and a Code of Ethics or Statement of Business Conduct (see details as per the section headed Corporate Governance, paragraph 1, shareholders’ rights), and it reviews these policies and monitors compliance with them consistently.

3.3 The Company’s Board of Directors has established guidelines for the careful consideration of transactions involving possible conflicts of interest for the Company and its shareholders, whereby anyone having an interest in any agenda item must disclose such interest to the meeting, and foregoes the right to take part in taking a decision on that item. The Company’s Board of Directors has established guidelines for the consideration of related party transactions and of acquisitions and disposals of Company assets, details as per the Policy and approach with regard to future related party transactions.

3.4 The Company’s Board of Directors attaches considerable importance to risk control and management systems, and has accordingly established a Risk Management Committee to establish duties and policies and a framework for managing the Company’s overall risk situation, covering the various risks that might affect the Company’s results and reputation, as well as establishing an internal audit department to ensure that basic working practices and important financial transactions are conducted in accordance with established guidelines and in an efficient manner. In order to make sure that the internal audit department can perform properly and independently, the Board has instructed it to report direct to the Audit Committee. (For details please refer to Internal Controls.)

4. Board Meetings

4.1 The Company’s Board of Directors establishes a schedule of Board meetings in advance for each year. Meetings take place at least once a quarter, with additional special meetings being held as and when necessary. The Company informs all Directors in advance of the schedule of meetings referred to above so as to enable them to plan their time and make themselves available for the meetings. Directors attach great importance to Board meetings and endeavour always to attend. Letters of invitation are sent at least seven days in advance clearly setting out the agenda. Each Director is free to suggest topics for the agenda, and to request additional information from the Managing Director or the Secretary to the Board of Directors.

4.2 At meetings of the Company’s Board of Directors, the President of the Board ensures that sufficient time is made available for Directors to discuss important problems thoroughly together, and the Managing Direc-tor always invites senior Administrators to attend Board meetings in order to provide additional detailed information to the extent that it is directly relevant to problems. One of the items on the agenda at all regular quarterly meetings of the Board is the following up of outstanding issues. Directors can express their opinions openly and freely. A written record is made of each meeting and, once the minutes have been approved by

the Board, they are kept available for Directors and other concerned parties to examine.


5. Board Self-Assessment

In 2008 the Company’s Board made a start with assessing its own overall performance, using the form provided by

the Listed Companies Supervision Development Centre of the Stock Exchange of Thailand, to allow all members

of the board to consider the board’s performance and solve any problems they may have, and arranged for the

self-assessment to take place on a regular annual basis. The result of Board assessment in 2011 is at level “ Good”

(Total score 3.37 out of 4 which increased 2% from 2010)

6. Remuneration

The Company has established a Nomination and Remuneration Committee, which is chaired by an independent

director and is charged with setting policies, methodology and criteria for establishing the remuneration of Directors,

the President and the Managing Director fairly, transparently, in consonance with the Company’s results and each

individual’s performance, in line with industry norms, and sufficient to reward directors having the desired character-

istics. Directors’ remuneration is subject to approval by a meeting of shareholders of the Company and to disclosure

in the Company’s Annual Report and in Form 56-1 as required by the SEC. (For details please refer to Directors’

and Administrators’ Remuneration.)

7. Development of Directors and Administrators

7.1 The Company’s Board of Directors facilitates and supports training and study for Directors and members of

the Audit Committee by way of regular attendance of various courses run by the Institute of Directors (IOD).

At present 78% of Directors have attended these courses. Details are as follows.

Name Course

1. Mr. Sompong Phaoenchoke Director Certification Program 26/20032. Ms. Kaewjai Phaoenchoke Director Certification Program 29/20033. Mr. Somkiat Nimrawee Director Accreditation Program 10/20044. Mr. Pricha Attavipach Director Certification Program 39/2004

Finance for Non-Finance Directors 8/20045. Mr. Suvait Theeravachirakul Director Certification Program 9/2001

Audit Committee Program 15/20066. Mr. Kavee Vasuvat Director Forum Program 1/2000

Director Accreditation Program 23/2004Director Certification Program 58/2005Finance for Non-Finance Directors 18/2005Audit Committee Program 10/2005

7. Mr Damri Tunshevavong Director Certification Program 106/2008Audit Committee Program 24/2008Role of the Chairman Program 22/2009Role of Compensation Committee 10/2010


7.2 The Company introduced new Directors to the nature of its business and guidelines for conducting its affairs.

7.3 With regard to the preparation of a plan for developing and testing the work of the Managing Director and top

level Administrators, no action has yet been taken, however the Nomination and Remuneration Committee

will consider this matter on due course.

Control o� �nternal �n�or� at�on

The Company is acutely aware of the importance of safeguarding the confidentiality of internal information and

therefore has strict policies guarding against the use by Directors and employees of internal information for their

personal benefit. Important internal information is revealed only to individuals directly concerned, such as auditors

or legal counsel. The Company releases information to shareholders only as and when appropriate.

The Board of Directors has resolved that Directors and Administrators of the Company and the Manager of Accounting

& Finance Department, together with their spouses, parents, children and siblings, must refrain from buying or selling

securities from at least five working days before the Company discloses its financial statements to the stock exchange.

The Company has also informed them of their obligation to report their shareholdings in the Company and those of

their spouses and of any children who are still minors, including the reporting of any changes in their shareholdings

to the SEC and the SET in accordance with article 59, subject to penalties for non-compliance as per article 275

of the Securities and Stock Exchange Act 1992, and has assigned the Share Register and Investor Relations

Department to inform them in advance of the periods during which they should refrain from trading in securities each

quarter. The Company has set out the basic principles of control of internal information in the form of an article in

the Company’s code of business ethics, to ensure that all employees adhere to them.

The Board of Directors has resolved that Directors and Administrators who are obliged by law to report their shareholdings

must submit these reports to the Company’s Board of Directors each time. The Board of Directors has further de-

termined that shareholdings of Directors and Administrators be reported every quarter to the Board. Additionally,

the Company’s Board of Directors requires Directors and senior executives to submit a Form for Reporting Interests

of Directors and Executives, reporting to the company any interests of their own or of related persons that relate to

their administration or management of the business of the Company or its subsidiaries, pursuant to Section 89/14 of

the Securities and Exchange Act of 2008 and SEC Announcement Thor Jor 2/2009. The report must be submitted

whenever there is a change in circumstances and in any case annually as at 1 July to provide assurance that Directors

and senior executives are performing their duties with due care and integrity (fiduciary duties) and taking decisions

without being interested parties, whether directly or indirectly and discharging their duties in the best interests of the

Company and its shareholders.


From Board Meetings during 2012 which were attended by all members of the Audit Committee, the Company’s

Board of Directors and the Audit Committee are of the opinion that the Company’s internal control systems are

adequate and appropriate. The following is a summary.

Organizational Control and Environmental Measure

The Company has clear business objectives with ongoing assessment of results, and has adapted its organisational

structure to make it appropriate to current business conditions so as to support the administration department and

enable it to work efficiently.

Additionally, the Company has established a policy and working plan focused on product quality and price and fair

service to customers. It has written procedures that serve as guidelines aimed at producing ordered work according

to standards, and there are mechanisms for inspecting and monitoring working practices in the fields of finance and

purchasing, administration generally, production and marketing in order to provide assurance that working practices

are in accordance with established policies and that there are no practices likely to damage the Company’s reputation

or interests.

Risk Management Measure

The Company attaches importance to managing risks that can affect its business, and has a Risk Committee to

oversee and assess risk factors and possible sources of risk as well as analysing the consequences of such risks

and alerting Administrators or operatives and together establishing measures and guidelines to protect against such

risks, monitoring compliance with such measures so as to keep risks at acceptable levels.

Management Control Activities

The Company has established the scope and powers and duties and monetary limits in writing for each level of the

administrative departments. There is clear division and separation of duties, approvals, recording of transactions

and safeguarding of assets.

Business dealings with major shareholders, Directors, Administrators or related parties are duly authorised, being

considered by Independent Directors who are not interested parties, and monitored for compliance with terms and

conditions. Investments in subsidiaries or joint ventures are monitored and overseen on an ongoing basis.

With regard to the operation of the various departments, audits by the internal audit department have found that

operations in general are in accordance with the rules and working systems established, with no instances of illegal

or irregular conduct being detected.

Internal Controls


Information and Communication Measure

For each regular Board meeting the Company prepares documentary information of various kinds to support the

agenda items so as to enable the Directors to have sufficient information on which to base their decisions. Resolutions

are summarised and adequately recorded in minutes which are available for inspection at all times.

Recording of accounting entries is in accordance with generally accepted principles and supporting documentation

is gathered together in categories and properly stored for the legally established periods. There is also a procedure

for fully following up on improvements recommended by the Company’s duly authorised auditors in their reports.

Monitoring System

The Company arranges regular quarterly Board Meetings, with special ad hoc meetings of senior executives on an

ongoing basis to consider and follow up on the work of the administration departments to ensure that it is in line with

objectives or, if it is not, to establish corrective guidelines.

As for internal control, a plan is established for the examination of working practices to ensure that they are consistently

in accordance with the Company’s rules and regulations and a report on any significant deficiencies is submitted to

the Audit Committee and the Board of Directors at a meeting which is arranged to coincide with the quarterly Board

meeting, for them to decide on any corrective and follow-up measures. Any event of misconduct or illegal act is

reported immediately to the Board of Directors.


Corporate Governance Report on Audit Committee

In 2012, The Audit Committee which is composed of three non-executive Independent Directors carried out their

duties in accordance with the Audit Committee Regulations and the guidelines of the SET in examining the efficiency

and adequacy of the Company’s internal control systems, and made various recommendations to administrative

departments with a view to maximising working efficiency and effectiveness. It also monitored compliance with

principles of good corporate governance and risk management, so as to enhance the value of the organisation to

its shareholders and other stakeholders. The main items can be summarised as follows:

1. Examination of the Company’s quarterly and annual financial statements for 2012 by seeking explanations from

administrators concerning their accuracy and completeness and adequacy of information disclosed. The Audit

Committee is of the opinion that the said financial statements are accurate in all material respects in accordance

with generally accepted accounting principles.

2. Examination of the Company’s internal control systems in accordance with guidelines laid down by the SEC.

The Audit Committee is of the opinion that the Company has adequate, appropriate and efficient mechanisms

for supervising and controlling its work processes.

3. Monitoring compliance with securities legislation, stock exchange regulations and other legislation relevant to

the Company’s business. The Audit Committee is of the opinion that the Company correctly and appropriately

complies with the aforementioned laws and regulations.

4. Considering the organisational structure and manpower of the Internal Audit Department, which reports directly

to the Audit Committee, giving its opinion on the mission, scope of duties, responsibilities, independence and

reporting of the Internal Audit Department to the Audit Committee and approving the annual audit plan.

5. Meeting with the Company’s auditors, ANS Audit Co Ltd without the presence of company officers, to confer on

major points relating to financial statements and ensure that the auditors’ accounting and financial reports are

comprehensive and detailed.

6. Selection and establishment of Company’s external auditors for 2012. We proposed to the Board of Directors

that ANS Audit Co., Ltd. be appointed as the Company’s auditors. The Audit Committee considered their work and

independence, and the appropriateness of their remuneration, and found it appropriate that Mr Atipong Atipongsakul,

CPA No. 3500 and/or Mr Prawit Viwanthananut, CPA No. 4917 and/or Mr Bunjong Pichayaprasat, CPA No. 7147

and/or Mr Vichai Ruchitanont, CPA No. 4054, and/or Mr. Satien Wongsanan, CPA No. 3495 all from ANS Audit

Co., Ltd. be appointed and their remuneration established at Bt.0.57m for the year. (unchanged from last year)


7. During 2012 the Audit Committee met four times. The last 3 meetings, all members of the Audit Committee

were present. At the first meeting, two of three were present, one being excused due to a business engagement.

8. In the course of the past year the Company carried out related party transactions or transactions likely to involve

a conflict of interest as per the stipulations of the SET and the SEC. The Audit Committee is of the opinion that

the aforementioned transactions were proper and appropriate and fully and accurately disclosed.

In conclusion the Audit Committee generally carried out its duties in accordance with the Audit Committee’s charter

as approved by the Company’s Board of Directors. The Audit Committee is of the opinion that the Company reports

financial and business information accurately, that it has internal control systems and that it complies fully with

the law concerning the disclosure of related party transactions and with rules for good corporate governance in a

transparent and reliable manner.

Pricha Attavipach

Chairman of the Audit Committee


Nomination and Remuneration Committee’s Report

The Nomination and Remuneration Committee, composed of three non-executive independent Directors, is charged with selecting individuals with appropriate qualities for occupying the position of Company Director in a proper and transparent manner, including from among any names proposed by shareholders, for onward submission to the Company’s Board of Directors and in turn to the shareholders for their approval, and with selecting persons with characteristics appropriate to the position of President and Managing Director in the event of their being a vacancy, for nomination to the Board of Directors for their consideration, and to prepare a succession plan for senior executive positions. It is also responsible for the setting policies, methodology and criteria for establishing, and for considering and reviewing the establishment of remuneration of Directors, the President and the Managing Director fairly, transparently and in consonance with the Company’s results and each individual’s performance. It reports independently to the Board of Directors so as to ensure that remuneration is established in a way that is appropriate and fair to all interested parties whilst safeguarding shareholders’ interests, in accordance with the Company’s principles of good corporate governance.

In 2012 the Nomination and Remuneration Committee met to consider the following matters

1. Establishment of remuneration for the year 2012 and monthly remuneration for 2013 for the President and the Managing Director

2. Establishment of remuneration for the year 2012 for individual Company Directors based on the performance of the Company and the duties and responsibilities and performance of each individual Director within an overall monetary limit to be approved by the shareholders.

3. Directors’ remuneration for 2013 for proposal to the Company’s Board of Directors and subsequently to the General Meeting of Shareholders for their approval, the Nomination and Remuneration Committee considering that the proposed remuneration was in line with the scope of duties and responsibilities of the Directors and with remuneration paid in comparable industries.

4. The appointment of a new Director to replace a Director resigning from his position and the appointment of Directors to replace those retiring by rotation, for submission to the Board of Directors and in turn to the general meeting of shareholders.

In summary, the Nomination and Remuneration Committee fully discharged its duties as assigned by the Company’s Board of Directors. Shareholders may this rest assured that the nomination of Directors and the establishment of their remuneration was carried out in a proper, appropriate and transparent manner and in accordance with the Company’s principles of good corporate governance.

Pricha Attavipach Chairman of the Nomination and Remuneration Committee


Board of Directors Responsibility for Financial Report

The Company’s Board of Directors is responsible for the consolidated financial statements of Thai Rung Union Car

Public Co., Ltd. and its subsidiaries and for the financial information which appears in the Annual Report. The financial

statements were prepared in accordance with generally accepted accounting standards, applying appropriate and

consistent accounting policies and with careful, prudent consideration and best possible estimates, making adequate

disclosure of information by way of notes to the financial statements.

The Board of Directors has put in place and maintains effective internal control systems which provide reasonable

assurance that the recording of transactions in the Company’s books is correct and complete, as well as adequately

protecting the Company’s assets and ensuring that any weak points can be detected and any misconduct or significant

abnormal occurrence thus prevented.

The Company’s Board of Directors has appointed an Audit Committee consisting of non-executive directors, which

is responsible for monitoring the quality of financial reports and internal control systems. The Audit Committee’s

opinion on these matters appears in the Report of the Audit Committee.

The Board considers that the Company’s internal control systems are at an appropriate level and provide

sufficient assurance in terms of the reliability of the financial statements of the Company and its subsidiaries as at

31 December 2012

Dr. Pranee Phaoenchoke Mr. Sompong Phaoenchoke

Chairman of the Board Managing Director


Management’s Discussion and Analysis

In 2012, the Thai automotive industry posted all-time record production of 2.4 million units, representing an increase

of 68% relative to 2011 and putting Thailand in the world’s top ten automakers. Domestic sales, at 1.43 million units,

showed an increase of 80%, largely thanks to the government’s economic stimulus package. Despite being faced

in 2012 with an increase in the Thai minimum legal daily wage to Bt.300, fluctuating fuel prices, a strengthening

Baht, a stagnant global economy and fierce competition both domestically and at ASEAN level, the Company was

able not only to overcome all obstacles, thanks to the determined efforts of management and employees, who trust

in the Company’s sound status based on many years of experience, but also to develop appropriate strategies for

seeking opportunities for expansion.

Thai Rung Union Car Plc. posted consolidated revenues of Bt.3,781 million for 2012, up by 67%, and net income

attributable to owners of the parent company of Bt.556 million, up by 199% on 2011. Growth in the Company’s

revenues outstripped that of the automotive industry as a whole, thanks to its adjusting its strategy to place more

stress on OEM parts making and contract assembly and painting work, which together now account for about 85%

of consolidated revenues, and also to its success in expanding the customer base to take in new segments such

as industrial and construction equipment, agricultural machinery and premium motorcycles, which is a high added

value niche market. The Company also opened up new markets for multi-purpose vehicles in various parts of the

world. This business should grow in the future and help reduce the risk of over-concentration in OEM business.

��nan��al re�ult�

Revenues

In 2012 , total consolidated revenues for the year 2012 amounted to Bt.3,781 m, representing an increase of Bt.1,518 m

or 67% on the previous year, as follows:

Revenues2012 2011 Increase

(Decrease)

Million Bt % Million Bt % Million Bt %

Revenue from vehicle assembly and other vehicle-related contract work 2,100.68 56% 1,116.10 49% 984.58 88%

Revenue from the production of vehicle manufacturing equipment 1,280.34 34% 763.67 34% 516.67 68%

Revenue from sales of vehicles and from service centres 118.56 3% 175.01 8% (56.45) -32%

Total revenue from Sales & service 3,499.58 93% 2,054.78 91% 1,444.80 70%

Other Income 202.72 5% 150.57 7% 52.15 35%

Profit sharing from associated company 78.54 2% 57.75 3% 20.79 36%

Total Revenes 3,780.84 100% ,263.10 100% 1,517.74 67%


Share in profits from investments in associates

Share in profits from investments in joint venture companies, at Bt.79m, was up by Bt.21m or 36% on 2011, reflecting

the fact that the joint ventures’ business - making equipment such as window regulators and car seats for automotive

assemblers-saw growth in line with that of the sector as a whole.

Cost of sales; expenses

Consolidated cost of sales and service for the year, at Bt.2,833m, was up by Bt.1,113m or 65% compared with

the previous year, in line with higher sales and service revenues, particularly from contract assembly and other

auto-related contract work and the production of vehicle manufacturing equipment. As a proportion of sales and

service revenue for the year, the cost of sales and service was 81%, down by 3% on the previous year since costs

grew by less than sales thanks to management and control of production costs and efficiency measures.

At the same time, selling and administrative expenses for 2012 amounted to Bt.264m, down by Bt.12m or 4% on

the previous year.

Net income

The Company posted a net profit of Bt.556m for 2012, representing 16% of sales and service revenue and an increase

of Bt.370m or 199% on the previous year’s result, thanks to increased sales and service revenue and to costs and

expenses being kept well under control through efficiency measures.

Anal�� o� Con�ol��ate� Balan�e ��eet as at 31 December 2012 compared with 31 December 2011

The financial position of the Company and its subsidiaries as at 31 December 2012 and 2011 is shown in the

following table.

Consolidated Balance Sheet THB millions

Assets 31 Dec. 2012 31 Dec. 2011 Change %

Total Current assets 1,770 1,083 687 63%

Investments in associates 245 220 24 11%

Investment property, net 243 247 (4) -2%

Property, plant & equipment, net 1,428 1,307 121 9%

Total Other non-current assets, net 176 147 29 20%

Total Assets 3,862 3,004 858 29%

Liabilities and Equity

Current liabilities 725 308 418 136%

Non-current liabilities 47 54 (7) -13%

Total Liabilities 773 362 410 113%


Assets 31 Dec. 2012 31 Dec. 2011 Change %

Equity

Attributable to owners of the parent company 2,995 2,562 433 17%

Non-controlling inte rests 95 80 15 18%

Total Equity 3,089 2,642 447 17%

Total Liabilities and Equity 3,862 3,004 858 29%

Assets

Total consolidated assets as at 31 December 2012 and 31 December 2011 stood at Bt.3,862m and Bt.3,004m

respectively, representing an increase of Bt.858m or 29%, due mainly to increases in current assets, specifically

trade receivables and inventories in line with higher sales volumes, and to a lesser extent to an increase in property,

plant and equipment due to capital expenditure on a second plant in Rayong province and ongoing investment in

machinery and equipment aimed at boosting production capacity and efficiency.

Liabilities

Total consolidated liabilities as at 31 December 2012 and 31 December 2011 stood at Bt.773m and Bt.362m respec-

tively, representing an increase of Bt.410m or 113%, due to an increase in trade payables in line with higher volumes

of purchases of raw materials reflecting increased production volumes in line with growing sales. None of these

trade payables were yet due as at reporting date. Apart from this, current income tax payable increase by Bt.46m

compared with the previous year, the Company having applied all its available (maximum five-year) carry-forward

tax losses during 2012. During the year a subsidiary was granted eight-year investment-promoting tax privileges.

Equity

Consolidated equity as at 31 December 2012 and 31 December 2011 stood at Bt.3,089m and Bt.2,642m respectively,

representing an increase of Bt.447m or 17% as a result of higher net profit.

As at 31 December 2012 the Company thus had consolidated liabilities of Bt.773m and equity of Bt.3,089m, giving

a net debt to equity ratio or gearing of 0.25:1, compared with 31 December 2011 when gearing stood at 0.14:1, the

difference being 0.11 times, due to increased trade payables in line with higher production volumes.


Cash flow statement

The Company’s consolidated cash situation for the year ended 31 December 2012 showed a net increase of Bt.336m,

with a year-end cash position of Bt.531.6m. Details are shown in the following tables.

THB millions

Net cash from operating activities 621

Net cash used in investing activities (159)

Net cash used in financing activities (127)

Net increase (decrease) in cash & cash equivalents in the period 336

Cash & cash equivalents at start of period 196

Cash & cash equivalents at end of period 532

Liquiity ratios 2012 2011

Current ratio time 2.44 3.52

Cash ratio time 1.20 0.34

Account receivable turnover time 5.55 6.15

Average collection period for receivables day 65.79 59.33

Cash cycle day 37.21 47.06

Net cash from operating activities increased thanks to improved profit. Net cash used in investing activities was

Bt.159m as a result of Bt.228m of capital expenditure on expanding the second factory in Rayong province and

buying machinery, net of Bt.23m proceeds from the sale of part of the Company’s shareholding in a joint venture

company and of Bt.35m in dividends received from joint venture and other associated companies. Net cash used in

financing activities was mainly due to payment of a dividend of Bt.123m to shareholders.


Auditor’s Report

To the Board of Directors and Shareholders of Thai Rung Union Car Public Company Limited

I have audited the accompanying consolidated and separate financial statements of Thai Rung Union Car Public Company

Limited and its subsidiaries and of Thai Rung Union Car Public Company Limited, respectively, which comprise the

consolidated and separate statements of financial position as at December 31, 2012, the consolidated and separate

statements of comprehensive income, consolidated and separate statements of changes in shareholders’ equity and

consolidated and separate statements of cash flows for the year then ended, and a summary of significant accounting

policies and other explanatory information.

Management’s Responsibility for the Financial Statements

Management is responsible for the preparation and fair presentation of these financial statements in accordance with Thai

Financial Reporting Standards, and for such internal control as management determines is necessary to enable the

preparation of financial statements that are free from material misstatement, whether due to fraud or error.

Auditor’s Responsibility

My responsibility is to express an opinion on these financial statements based on my audit. I conducted my audit in

accordance with Thai Standards on Auditing. Those standards require that I comply with ethical requirements and plan and

perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial

statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material

misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor

considers internal control relevant to the entity’s preparation and fair presentation of the financial statements in order to

design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the

effectiveness of the entity’s internal control. An audit also includes evaluating the appropriateness of accounting policies

used and the reasonableness of accounting estimates made by management, as well as evaluating the overall presentation of

the financial statements.

I believe that the audit evidence I have obtained is sufficient and appropriate to provide a basis for my qualified audit

opinion.

ANNUAL REPORT 2012THAI RUNG UNION CAR PUBLIC COMPANY LIMITED�0

Basis for Qualified Opinion

The Company’s consolidated financial statements as at December 31, 2012, and for the year then ended, included

investments in three associated companies accounted for under the equity method amounting to Baht 244.89 million and

shares of profit from these companies amounting to Baht 78.54 million (as discussed in Note 7 to the financial statements).

These were recorded based on financial statements prepared by the management of such associated companies, which were

not audited by their auditors.

Opinion

In my opinion, except for the effects on the financial statements of the matter as mentioned in the basis for qualified opinion

paragraph, the financial statements referred to above present fairly, in all material respects, the financial position of Thai

Rung Union Car Public Company Limited and its subsidiaries and of Thai Rung Union Car Public Company Limited as at

December 31, 2012, and their financial performance and cash flows for the year then ended in accordance with Thai

Financial Reporting Standards.

Sathien Vongsnan Certified Public Accountant Registration Number 3495

ANS Audit Company Limited Bangkok, February 22, 2013

ANNUAL REPORT 2012THAI RUNG UNION CAR PUBLIC COMPANY LIMITED 61

Consolidated financial statements Separate financial statements

Notes 2012 2011 2012 2011

��

CURR�NT ASS�TS

Cash and cash equivalents 531,�01,418 195,�95,091 375,��5,108 108,473,151

Trade and other receivables � net 4, 5 9�5,�98,�82 342,344,083 721,798,980 234,93�,180

Unbilled receivable 35,240,3�8 343,�8�,2�0 � �

Short�term loans to related parties 4 � � 180,000,000 355,500,000

Inventories � net � 237,902,347 201,370,700 100,915,8�7 99,490,1�8

Total current assets 1,770,442,815 1,083,09�,134 1,378,379,955 798,399,499

N�N�CURR�NT ASS�TS

Investments in associated companies 7 244,894,405 220,453,009 114,100,000 121,550,000

Investments in subsidiaries 8 � � 412,880,000 412,880,000

�ther long�term investment � net 9 � � � �

Investment property � net 10 243,1�5,�34 247,0�5,157 � �

Property, plant and equipment � net 11 1,427,722,752 1,307,122,150 750,591,344 715,914,173

Intangible assets � net 2,�9�,421 4,093,471 2,120,110 3,�24,418

Deferred tax assets 12 17,932,587 34,702,940 8,894,349 13,011,253

�ther non�current assets � net 13 155,310,484 107,727,150 144,5�8,094 120,937,754

Total non�current assets 2,091,722,283 1,921,1�3,877 1,433,153,897 1,387,917,598

�O�� 3,8�2,1�5,098 3,004,2�0,011 2,811,533,852 2,18�,317,097

Unit� Baht

The accompanying notes are an integral part of the financial statements.

Thai Rung Union Car Public Company Limited and its subsidiaries

As at 31 December 2012 and 2011

Statements of Financial Position

ANNUAL REPORT 2012THAI RUNG UNION CAR PUBLIC COMPANY LIMITED62


Notes 2012 2011 2012 2011

Unit� Baht

�� O��

CURR�NT LIABILITI�S

Trade and other payables 4, 15 �77,039,222 305,390,255 �2�,�34,340 27�,8�2,313

Current portion of liabilities under finance leases 2,501,047 2,402,250 � �

Current income tax payable 45,783,285 � 45,783,285 �

Total current liabilities 725,323,554 307,792,505 �72,417,�25 27�,8�2,313

N�N�CURR�NT LIABILITI�S

Long�term liabilities under finance leases 851,545 3,352,592 � �

Deferred tax liabilities 12 3,2�1,�83 1,774,914 1,157,398 591,2�0

�mployee benefit obligations 1� 43,233,95� 49,2�0,074 27,805,547 28,8�7,504

Total non�current liabilities 47,347,184 54,387,580 28,9�2,945 29,458,7�4

T�TAL LIABILITI�S 772,�70,738 3�2,180,085 701,380,570 30�,321,077

S�AR��LD�RS� ��UIT�

Share capital

Authori�ed

524,99�,497 ordinary shares, Baht 1 par value 524,99�,497 524,99�,497 524,99�,497 524,99�,497

Issued and paid up

501,589,497 ordinary shares, Baht 1 per share 501,589,497 501,589,497 501,589,497 501,589,497

Treasury shares 18 (47,950,454) (47,950,454) (47,950,454) (47,950,454)

Additional paid�in capital

Premium on ordinary shares 727,144,000 727,144,000 727,144,000 727,144,000

Retained earnings

Appropriated

Legal reserve � the Company 19 52,499,�49 52,499,�49 52,499,�49 52,499,�49

� Subsidiaries 1�,793,902 1�,793,902 � �

Treasury share reserve 19 47,950,454 47,950,454 47,950,454 47,950,454

Unappropriated 1,�9�,539,449 1,2�3,840,81� 828,920,13� 598,7�2,874

Total shareholders� equity of the Company 2,994,5��,497 2,5�1,8�7,8�4 2,110,153,282 1,879,99�,020

Non�controlling interests 94,927,8�3 80,212,0�2 � �

T�TAL S�AR��LD�RS� ��UIT� 3,089,494,3�0 2,�42,079,92� 2,110,153,282 1,879,99�,020

�O�� O�� 3,8�2,1�5,098 3,004,2�0,011 2,811,533,852 2,18�,317,097



As at 31 December 2012 and 2011

Statements of Financial Position

ANNUAL REPORT 2012THAI RUNG UNION CAR PUBLIC COMPANY LIMITED 6�


Notes 2012 2011 2012 2011

��n�� 4, 24

Sales of goods 2,479,432,�41 1,49�,253,530 1,323,171,�2� 875,921,492

Rendering of services 1,020,143,939 558,522,955 847,852,858 34�,051,823

Total revenues 3,499,57�,580 2,054,77�,485 2,171,024,484 1,221,973,315

Cost 4, 1�

Cost of sales (2,1�7,254,122) (1,314,473,011) (1,180,181,029) (737,725,7�4)

Cost of rendering of services (��5,783,275) (405,734,132) (450,895,144) (230,71�,720)

Total cost (2,833,037,397) (1,720,207,143) (1,�31,07�,173) (9�8,442,484)

��o�� p�o�i� ��,539,183 334,5�9,342 539,948,311 253,530,831

Dividend income 4, 7, 8 � � 50,728,712 91,907,0�2

�ther income 7, 19 202,720,9�1 150,571,825 114,198,��0 115,038,741

Selling expenses 4, 1� (�7,29�,421) (81,482,130) (113,�29,172) (10�,341,092)

Adminstrative expenses 4, 1� (19�,977,701) (194,�09,433) (147,259,835) (154,�75,39�)

Financing cost (807,322) (238,211) (710,411) (153,408)

Share of profit from investments in associated companies 7 78,543,329 57,753,123 � �

��o�i� ��o�� in�o�� p�n�� 82,722,029 2��,5�4,51� 443,27�,2�5 199,30�,738

Income tax expenses 12, 21 (111,197,14�) (75,�93,598) (90,028,554) (34,987,03�)

��o�i� �o� �� 571,524,883 190,870,918 353,247,711 1�4,319,702

�ther comprehensive income for the year � � � �

�o�� o�p��n�i�� in�o�� o� �� 571,524,883 190,870,918 353,247,711 1�4,319,702

��o�i� ��i�� o

�quity holders of the Company 23 555,789,082 18�,218,794 353,247,711 1�4,319,702

Non�controlling interests 15,735,801 4,�52,124

571,524,883 190,870,918

��nin�� p��

�arnings per share

Profit attributable to equity holders of the Company (Baht) 23 1.13 0.38 0.72 0.33

�eighted average number of ordinary shares (shares) 492,372,797 492,372,797 492,372,797 492,372,797

Unit� Baht



For the years ended December 31 2012 and 2011

Statements of Comprehensive Income

ANNUAL REPORT 2012THAI RUNG UNION CAR PUBLIC COMPANY LIMITED6�

Issue

d an

d Pr

emiu

mTo

tal

paid

�up

on o

rdin

ary

Trea

sury

shar

e res

erve

Non�

cont

rolli

ngsh

areh

olde

r�s

Notes

shar

e cap

ital

Trea

sury

shar

essh

ares

Th

e Com

pany

Subs

idiar

iesTh

e Com

pany

Unap

prop

riated

Total

inter

ests

equi

ty

Balan

ce as

at D

ecem

ber 3

1, 2

011

501,

589,

497

(4

7,95

0,45

4)

727,

144,

000

52

,499

,�49

1�

,793

,902

47,9

50,4

54

1,2�

3,84

0,81

�

2,

5�1,

8�7,

8�4

80

,212

,0�2

2,

�42,

079,

92�

Chan

ges i

n eq

uity

for t

he y

ear �

Divi

dend

paid

by

subs

idiar

y8

�

�

�

�

�

�

�

�

(1,0

20,0

00)

(1,0

20,0

00)

Divi

dend

paid

2��

�

�

�

�

�

(123

,090

,449

)

(123

,090

,449

)

�

(123

,090

,449

)

Total

com

preh

ensiv

e inc

ome f

or th

e yea

r�

�

�

�

�

�

555,

789,

082

55

5,78

9,08

2

15

,735

,801

57

1,52

4,88

3

Balan

ce as

at D

ecem

ber 3

1, 2

012

501,

589,

497

(4

7,95

0,45

4)

727,

144,

000

52

,499

,�49

1�

,793

,902

47,9

50,4

54

1,�9

�,53

9,44

9

2,

994,

5��,

497

94

,927

,8�3

3,

089,

494,

3�0

Balan

ce as

at D

ecem

ber 3

1, 2

010

501,

589,

497

(4

7,95

0,45

4)

727,

144,

000

52

,499

,�49

1�

,793

,902

47,9

50,4

54

1,13

7,51

5,9�

�

2,

435,

543,

014

75

,503

,444

2,

511,

04�,

458

�ffe

cts o

f def

erre

d tax

acco

untin

g�

�

�

�

�

�

88,�

23,5

3�

88

,�23

,53�

3,

348,

920

91,9

72,4

5�

Balan

ce af

ter re

stated

as at

Dec

embe

r 31,

201

0 50

1,58

9,49

7

(47,

950,

454)

72

7,14

4,00

0

52,4

99,�

49

1�,7

93,9

02

47

,950

,454

1,

22�,

139,

502

2,52

4,1�

�,55

0

78,8

52,3

�4

2,�0

3,01

8,91

4

�ffe

cts o

f cha

nges

in ac

coun

ting

polic

ies�

�

�

�

�

�

(25,

425,

031)

(25,

425,

031)

(8

92,4

2�)

(2

�,31

7,45

7)

Balan

ce as

at �a

nuar

y 1,

201

150

1,58

9,49

7

(47,

950,

454)

72

7,14

4,00

0

52,4

99,�

49

1�,7

93,9

02

47

,950

,454

1,

200,

714,

471

2,49

8,74

1,51

9

77,9

59,9

38

2,57

�,70

1,45

7

Chan

ges i

n eq

uity

for t

he y

ear �

Divi

dend

paid

by

subs

idiar

y8

�

�

�

�

�

�

�

�

(2,4

00,0

00)

(2,4

00,0

00)

Divi

dend

paid

2��

�

�

�

�

�

(123

,092

,449

)

(123

,092

,449

)

�

(123

,092

,449

)

Total

com

preh

ensiv

e inc

ome f

or th

e yea

r�

�

�

�

�

�

18�,

218,

794

18

�,21

8,79

4

4,

�52,

124

190,

870,

918

Balan

ce as

at D

ecem

ber 3

1, 2

011

501,

589,

497

(4

7,95

0,45

4)

727,

144,

000

52

,499

,�49

1�

,793

,902

47,9

50,4

54

1,2�

3,84

0,81

�

2,

5�1,

8�7,

8�4

80

,212

,0�2

2,

�42,

079,

92�

Retai

ned

earn

ings

Appr

opria

ted

Statu

tory

rese

rve

Unit�

Bah

t

Cons

olid

ated

finan

cial s

tatem

ents

�qui

ty at

tribu

table

to eq

uity

hol

ders

of th

e Com

pany

The a

ccom

pany

ing

notes

are a

n in

tegra

l par

t of t

he fi

nanc

ial st

atem

ents.

Thai R

ung

Union

Car P

ublic

Com

pany

Lim

ited

and

its sub

sidiarie

s

For t

he yea

rs e

nded

Dec

embe

r 31

2012

and

201

1

Stat

emen

ts o

f C

hang

es in

Sha

reho

lder

’s E

quit

y


Issue

d an

d Pr

emiu

mTo

tal

paid

�up

on o

rdin

ary

shar

ehol

der�s

Notes

shar

e cap

ital

Trea

sury

shar

essh

ares

sta

tuto

ry re

serv

eTr

easu

ry sh

are r

eser

veUn

appr

opria

tedeq

uity

Balan

ce as

at D

ecem

ber 3

1, 2

011

501,

589,

497

(4

7,95

0,45

4)

727,

144,

000

52

,499

,�49

47,9

50,4

54

59

8,7�

2,87

4

1,87

9,99

�,02

0

Chan

ges i

n eq

uity

for t

he y

ear �

Divi

dend

paid

2��

�

�

�

�

(123

,090

,449

)

(123

,090

,449

)

Total

com

preh

ensiv

e inc

ome f

or th

e yea

r�

�

�

�

�

35

3,24

7,71

1

353,

247,

711

Balan

ce as

at D

ecem

ber 3

1, 2

012

501,

589,

497

(4

7,95

0,45

4)

727,

144,

000

52

,499

,�49

47,9

50,4

54

82

8,92

0,13

�

2,11

0,15

3,28

2

Balan

ce as

at D

ecem

ber 3

1, 2

010

501,

589,

497

(4

7,95

0,45

4)

727,

144,

000

52

,499

,�49

47,9

50,4

54

53

0,�2

1,37

4

1,81

1,85

4,52

0

�ffe

cts o

f def

erre

d tax

acco

untin

g�

�

�

�

�

41,2

59,1

94

41

,259

,194

Balan

ce af

ter re

stated

as at

Dec

embe

r 31,

201

050

1,58

9,49

7

(47,

950,

454)

72

7,14

4,00

0

52,4

99,�

49

47

,950

,454

571,

880,

5�8

1,

853,

113,

714

�ffe

cts o

f cha

nges

in ac

coun

ting

polic

ies�

�

�

�

�

(14,

344,

947)

(1

4,34

4,94

7)

Balan

ce as

at �a

nuar

y 1,

201

150

1,58

9,49

7

(47,

950,

454)

72

7,14

4,00

0

52,4

99,�

49

47

,950

,454

557,

535,

�21

1,

838,

7�8,

7�7

Chan

ges i

n eq

uity

for t

he y

ear �

Divi

dend

paid

2��

�

�

�

�

(123

,092

,449

)

(123

,092

,449

)

Total

com

preh

ensiv

e inc

ome f

or th

e yea

r�

�

�

�

�

1�4,

319,

702

1�

4,31

9,70

2

Balan

ce as

at D

ecem

ber 3

1, 2

011

501,

589,

497

(4

7,95

0,45

4)

727,

144,

000

52

,499

,�49

47,9

50,4

54

59

8,7�

2,87

4

1,87

9,99

�,02

0

Appr

opria

ted

��

��

�� O

� ��

��

��

��

��

O��

��

��

��

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��

��

�O�

��

��

� ��

��

��

��

� ��

� ��

� ��

� ��

��

Unit�

Bah

t

Sepa

rate

finan

cial s

tatem

ents Re

taine

d ea

rnin

gs

The a

ccom

pany

ing

notes

are a

n in

tegra

l par

t of t

he fi

nanc

ial st

atem

ents.

Thai R

ung

Union

Car P

ublic

Com

pany

Lim

ited

and

its sub

sidiarie

s

For t

he yea

rs e

nded

Dec

embe

r 31

2012

and

201

1

Stat

emen

ts o

f C

hang

es in

Sha

reho

lder

’s E

quit

y (C

onti

nue)



2012 2011 2012 2011

Cash flows from operating activities

Net profit before income tax expenses �82,722,029 2��,5�4,51� 443,27�,2�5 199,30�,738

Ad�ustments to reconcile net profit before tax to

Net cash provided (used in) operating activities�

Allowance for diminution in value of inventories 278,20� 12,944,�78 278,20� 3,120,000

�rite�off inventories (24,588,9�9) � (5,278,20�) �

Share of profit from investments in associates (78,543,329) (57,753,123) � �

(Reversal) allowance for devaluation of dies and deferred cost of dies (3,55�,822) 7,�9�,822 � 4,140,000

Reversal allowance for devaluation of fixed assets (9,317,7��) � (9,317,7��) �

Depreciation and amorti�ation 110,�94,��9 82,803,028 49,033,175 42,410,439

�rite�off investment property 1,9�1,222 � � �

�rite�off fixed assets � 55,410 � 55,410

Amortisation of leasehold rights 523,302 523,304 � �

Provision for liabilities 2,25�,039 � � �

(Reversal) employee benefit expense (5,101,5�8) 12,804,497 (798,457) 8,374,723

(�ain) loss on sales of fixed assets 1,793,880 (1,321,312) 2,1�7,�39 (5,390,521)

�ain on sales of investment (3,�97,080) � (15,�00,300) �

Dividend income � � (50,728,712) (91,907,0�2)

Interest income (3,899,551) (5,719,834) (10,892,283) (7,��3,847)

Interest expense 807,322 238,211 710,411 153,408

Profit from operating activities before

changes in operating assets and liabilities �72,331,584 318,83�,197 402,849,972 152,599,288

�perating assets (increase) decrease

Trade and other receivable �net (�23,29�,�0�) �7,297,448 (48�,0��,700) �4,�03,897

Inventories (12,220,884) (28,993,850) 3,574,300 (1�,578,010)

Unbilled receivables 308,445,891 (127,050,112) � �

�ther non�current assets (3�,749,55�) (30,772,498) (28,254,585) (14,888,787)

�perating liabilities increase (decrease)

Trade and other payables 3�9,392,930 (7�,730,350) 349,772,02� 73,52�,241

Cash flows from operating activities �77,903,359 122,58�,835 241,875,013 259,2�2,�29

Cash paid for interest expense (807,322) � (710,411) (371,345)

Cash received from income tax refund 5,545,11� 15,852,408 4,�24,24� 12,�15,25�

Cash paid for employee benefit (924,550) (1,140,791) (2�3,500) �

Cash paid for corporate income tax (�0,502,113) (19,815,34�) (39,5�2,228) (10,7�5,954)

Net cash flows from operating activities �21,214,490 117,483,10� 205,9�3,120 2�0,740,58�

Unit� Baht



Statements of Cash Flows

The accompanying notes are an integral part of the financial statements.ANNUAL REPORT 2012

THAI RUNG UNION CAR PUBLIC COMPANY LIMITED 6�


2012 2011 2012 2011

Unit� Baht

Cash flows from investing activities

Increase in short�term loans to related parties � (10,000,000) (447,000,000) (344,500,000)

Proceeds from short�term loans to related parties � 5�,500,000 �22,500,000 77,500,000

Proceeds from sales of fixed assets 7,393,�25 1,4��,139 �,474,224 5,540,�78

Interest received 3,841,558 �,508,�58 10,09�,183 5,900,�38

Dividend from associated companies and subsidiary company 34,748,712 54,307,0�2 50,728,712 91,907,0�2

Acquisition of fixed assets and intangible assets (227,829,�59) (330,355,992) (81,530,133) (54,147,082)

Cash received from sales investment from associated company 23,050,300 � 23,050,300 �

Net cash flows from (used in) investing activities (158,795,4�4) (221,574,133) 184,319,28� (217,798,704)

Cash flows from financing activities

Increase in short�term loans from related party � � 20,000,000 7,000,000

Payment on short�term loans from related party � � (20,000,000) (53,000,000)

Finance lease liabilities payment (2,402,250) (1,709,520) � (135,035)

Dividend paid (123,090,449) (123,092,449) (123,090,449) (123,092,449)

Dividend paid by subsidiaries to non�controlling interests (1,020,000) (2,400,000) � �

Net cash flows used in financing activities (12�,512,�99) (127,201,9�9) (123,090,449) (1�9,227,484)

Net increase (decrease) in cash and cash equivalents 335,90�,327 (231,292,99�) 2�7,191,957 (12�,285,�02)

Cash and cash equivalents at beginning of year 195,�95,091 42�,988,087 108,473,151 234,758,753

Cash and cash equivalents at end of year 531,�01,418 195,�95,091 375,��5,108 108,473,151



Statements of Cash Flows (Continue)





Note to Consolidated Financial Statements

1. GENERAL INFORMATION

Thai Rung Union Car Public Company Limited (“The Company”) is a public company incorporated and

domiciled in Thailand. The Company is principally engaged in car assembly and modification, and the

manufacture and distribution of parts and mold. Its registered address is located at 28/6 Moo 1, Petchakasem

Road, Khwaeng Nongkangploo, Khet Nongkaem, Bangkok.

2. BASIS OF PREPARATION OF THE FINANCIAL STATEMENTS

The accompanying financial statements are prepared in accordance with Thai Financial Reporting Standards

(“TFRS”) including related interpretations and guidelines promulgated by the Federation of Accounting

Professions (“FAP”) in conformity with generally accepted accounting principles in Thailand.

The presentation of the financial statements has been made in compliance with the stipulations of the Notification

of the Department of Business Development dated September 28, 2011, issued under the Accounting Act B.E.

2543.

The accompanying financial statements have been prepared in Thai language and expressed in Thai Baht. Such

financial statements have been prepared for domestic reporting purposes. For the convenience of the readers not

conversant with the Thai language, an English version of the financial statements has been provided by translating

from the Thai version of the financial statements.

The preparation of the financial statements in conformity with Thai Financial Reporting Standards (“TFRS”)

requires management to make judgments, estimates and assumptions that affect the application of policies and

reported amounts of assets, liabilities, income and expenses. The estimates and associated assumptions are based

on historical experience and various other factors that are believed to be reasonable under the circumstances, the

results of which form the basis of making the judgments about carrying amounts of assets and liabilities that are

not readily apparent from other sources. Subsequent actual results may differ from these estimates.

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates

are recognized in the period in which the estimate is revised, if the revision affects only that period, and in the

period of the revision and future periods, if the revision affects both current and future periods

Basis of consolidation

The consolidated financial statements include the financial statements of Thai Rung Union Car Public Company

Limited (“the Company”) and the following subsidiary companies (“the subsidiaries”):


Company’s name Nature of business Incorporation of shareholding

2012 2011

Percent Percent

Subsidiaries directly held by the Company

Thai V.P. Auto Service Co., Ltd. Sales of cars, spare parts Thailand 94 94

and car service centers

Thai Rung Tools and Dies Co., Ltd. Mold making service Thailand 94 94

Thai Auto Pressparts Co., Ltd. Manufacture of vehicle’s Thailand 91 91

body parts

Subsidiaries held by Thai V.P. Auto Service Co., Ltd.

Thai Ultimate Car Co. Ltd. Sales of cars, spare parts Thailand 99.53 99.53

and accessories and car

service centers

On February 15, 2011, Thai Ultimate Car Co., Ltd. (Subsidiary held by Thai V.P. Auto Service Co., Ltd.) had

registered to engage more services operation which are the services in legal, accounting, commercial, industrial,

and such services and others related to business and tax administration of large organization.

All significant intercompany transactions and accounts were eliminated in preparing the consolidated financial

statements.

Subsidiary is an entity controlled by the Company. Control exists when the Company has the power, directly or

indirectly through other subsidiaries, to govern the financial and operating policies of an entity so as to obtain

benefits from its activities. The financial statements of the subsidiary are included in the consolidated financial

statements from the date that control commences until the date that control ceases.

The preparations of the consolidated financial statements have been based on the same accounting policies for the

same or similar accounting transactions or accounting events.

The changes in accounting policies as at January 1, 2011

In the year 2011, the Company and its subsidiaries has adopted new and revised TFRS which such transition

affected the financial statements reflected from the adoption of TAS 12 Income Taxes, TAS No. 16 (revised 2009)

“Property, Plant and Equipment” and TAS No. 19 “Employee Benefits”.

New and revised Thai Financial Reporting Standards not yet effective

The Company and its subsidiaries have not yet adopted the new and revised Thai Financial Reporting Standards as

follows:


a) Thai Accounting Standards (TAS), Thai Financial Reporting Standards (TFRS), Thai Interpretation (TI) and

guidelines which are effective for the financial statements for the period beginning on or after January 1,

2013 as follows:

TAS/TFRS/TI/FAP’s Announcement Topic

TAS 20 (revised 2009) Accounting for Government Grants and Disclosures of Government

Assistance

TAS 21 (revised 2009) The Effects of Changes in Foreign Exchange Rate

TFRS 8 Operating Segments

TI 10 Government Assistance – No Specific Relation to Operating Activities

TI 21 Income Taxes – Recovery of Revalued Non-Depreciable Assets

TI 25 Income Taxes – Changes in the Tax Status of an Enterprise or its

Shareholders

No. 34/2555 Accounting Guidance for Transfer and Transferred of Financial Assets

The management of the Company and its subsidiaries are assessing the impacts of these standards, interpretations

and guideline on the financial statements for the period in which they are initially applied.

b) Thai Financial Reporting Interpretations (TFRI) and TI which are effective for the financial statements for

the period beginning on or after January 1, 2014 as follows:

TFRI/TI Topic

TFRI 4 Determining whether an Arrangement contains a Lease

TFRI 12 Service Concession Arrangements

TFRI 13 Customer Loyalty Programmes

TI 29 Service Concession Arrangements: Disclosures

The Company and its subsidiaries are assessing the impacts of these interpretations on the financial statements for

the year in which they are initially applied.

3. SIGNIFICANT ACCOUNTING POLICIES

Cash and cash equivalents

Cash and cash equivalents in the statements of cash flows comprise cash balances, call deposits and highly liquid

short-term investments with an original maturity of three months or less and not subject to withdrawal

restrictions. Bank overdrafts that are repayable on demand are a component of financing activities for the purpose

of the statement of cash flows.

Trade and other accounts receivable

Trade and other accounts receivable are stated at their invoice value less allowance for doubtful accounts.

ANNUAL REPORT 2012THAI RUNG UNION CAR PUBLIC COMPANY LIMITED �1

The allowance for doubtful accounts is assessed primarily on analysis of payment histories and future

expectations of customer payments. Bad debts are written off when incurred.

Inventories

Inventories are measured at the lower of cost and net realisable value.

Cost is calculated using the weighted average cost principle, and comprises all costs of purchase, costs of

conversion and other costs incurred in bringing the inventories to their present location and condition. In the case

of manufactured inventories and work-in-progress, cost includes an appropriate share of production overheads

based on normal operating capacity and is calculated using standard cost adjusted to approximate average cost.

Finished goods and work in process are valued at the lower of standard cost (which approximates actual cost) and

net realisable value. Standard cost includes all production costs and attributable factory overheads.

Raw materials and parts are valued at the lower of standard cost (which approximates actual cost) and net

realisable value and are charged to production costs and cost of services whenever consumed.

Spare parts of car service centers are valued at the lower of cost (moving average method) and net realisable

value.

Cars purchased for sales are valued at the lower of cost (specific identification method) and net realisable value.

Allowance for diminution in value of inventories is recorded by considering old, slow-moving and obsolete

inventories.

Net realisable value is the estimated selling price in the ordinary course of business less the estimated costs to

complete and to make the sale.

Investments

Investments in subsidiaries and associates

Investments in subsidiaries and associates in the separate financial statements of the Company are accounted for

using the cost method net of allowance for loss on diminution in value (if any). Investments in associates in the

consolidated financial statements are accounted for using the equity method.

Investment properties

Investment properties are properties which are held to earn rental income, for capital appreciation or for both, but

not for sale in the ordinary course of business, use in the production or supply of goods or services or for

administrative purposes.

Investment properties are stated at cost less accumulated depreciation and less allowance for impairment loss (if

any).


Depreciation

Depreciation is computed by the straight–line method based on the useful lives of assets of 30 years

Depreciation is included in determining operating result and no depreciation is provided on land and property in

progress.

Repairs and maintenance are charged to the statement of income during the financial years in which they are

incurred. The cost of major renovations is included in the carrying amount of the asset when it is probable that

future economic benefits in excess of the originally assessed standard of performance of the existing asset will

flow to the Group. Major renovations are depreciated over the remaining useful life of the related asset.

Reclassification to property, plant and equipment

When the use of a property changes such that it is reclassified as property, plant and equipment, its fair value at

the date of reclassification becomes its cost for subsequent accounting.

Property, plant and equipment

Owned assets

Property, plant and equipment are stated at cost less accumulated depreciation and impairment losses of assets (if

any).

Cost includes expenditure that is directly attributable to the acquisition of the asset. The cost of self-constructed

assets includes the cost of materials and direct labour, any other costs directly attributable to bringing the assets to

a working condition for their intended use, the costs of dismantling and removing the items and restoring the site

on which they are located, and capitalised borrowing costs. Cost also may include transfers from other

comprehensive income of any gain or loss on qualifying cash flow hedges of foreign currency purchases of

property, plant and equipment.

When parts of an item of property, plant and equipment have different useful lives, they are accounted for as

separate items (major components) of property, plant and equipment.

Gains and losses on disposal of an item of property, plant and equipment are determined by comparing the

proceeds from disposal with the carrying amount of property, plant and equipment, and are recognised net within

other income in profit or loss. When revalued assets are sold, the amounts included in the revaluation reserve are

transferred to retained earnings.

Leased assets

Leases in terms of which the Company and its subsidiaries substantially assume all the risk and rewards of

ownership are classified as finance leases. Property, plant and equipment acquired by way of finance leases is

capitalized at the lower of its fair value and the present value of the minimum lease payments at the inception of


the lease, less accumulated depreciation and impairment losses. Lease payments are apportioned between the

finance charges and reduction of the lease liability so as to achieve a constant rate of interest on the remaining

balance of the liability. �inance charges are charged directly to the profit or loss.

��se��e�t ��sts

The cost of replacing a part of an item of property, plant and equipment is recognised in the carrying amount of

the item if it is probable that the future economic benefits embodied within the part will flow to the Company and

its subsidiaries, and its cost can be measured reliably. The carrying amount of the replaced part is derecognised.

The costs of the day-to-day servicing of property, plant and equipment are recognised in profit or loss as incurred.

�e��e��at��

�epreciation is calculated based on the depreciable amount, which is the cost of an asset, or other amount

substituted for cost, less its residual value.

�epreciation is charged to profit or loss on a straight-line basis over the estimated useful lives of each component

of an item of property, plant and equipment. The estimated useful lives are as follows�

�epreciation method �seful life

(years)

Land improvement �traight-line method ��

�actory and building improvement �traight-line method � - ��

�ffice buildings and building improvement �traight-line method ��

�achinery, factory equipment and tools �traight-line method � - ��

(excluded molds and jigs)

�achinery, factory equipment and tools

acquired before �� and molds and jigs

�eclining method

(�ouble declining method)

�

�ffice equipment acquired before �uly �� eclining method


�

�ffice equipment �traight-line method �

�otor vehicles acquired before �uly �� eclining method


�

�otor vehicles �traight-line method �

�o depreciation is provided on land or assets under construction.

�epreciation methods, useful lives and residual values are reviewed at each financial year-end and adjusted if

appropriate.

Land leasehold rights

Land leasehold rights are stated at cost less accumulated amortization. �mortization of land leasehold rights is


calculated by reference to their costs on a straight-line basis over the periods of lease agreements.

�mortization is included in determining income.

�ntangible assets

�esea�� a�d de�e��e�t

�xpenditure on research activities, undertaken with the prospect of gaining new scientific or technical knowledge

and understanding, is recognised in profit or loss as incurred.

�evelopment activities involve a plan or design for the production of new or substantially improved products and

processes. �evelopment expenditure is capitalised only if development costs can be measured reliably, the

product or process is technically and commercially feasible, future economic benefits are probable, and the

Company and its subsidiaries intend to and have sufficient resources to complete development and to use or sell

the asset. The expenditure capitalised includes the cost of materials, direct labour, overhead costs that are directly

attributable to preparing the asset for its intended use, and capitalised borrowing costs. �ther development

expenditure is recognised in profit or loss as incurred.

�t�e� ��ta��e assets

�ntangible assets that are acquired are stated at cost less accumulated amortisation and losses on decline in value.

��t��at��

�mortization is recognised in profit or loss on a straight-line basis over the estimated useful lives of intangible

assets, from the date that they are available for use. The estimated useful lives for the current and comparative

periods are as follows�

�mortization method �seful life

(years)

�oftware �traight-line method �

�mpairment

The carrying amounts of the Company’s and its subsidiaries’ assets are reviewed at each reporting date to

determine whether there is any indication of impairment. If any such indication exists, the assets’ recoverable

amounts are estimated.

�n impairment loss is recognised if the carrying amount of an asset exceeds its recoverable amount. The

impairment loss is recognised in profit or loss unless it reverses a previous revaluation credited to equity, in which

case it is charged to equity.

Trade and other accounts payable

Trade and other accounts payable are stated at cost.


�mployee benefits

��t�te�� e�e��ts

The Company and its subsidiaries recognize salaries, wages, bonus and social security contribution as expenses

on an accrual basis.

��st�e��e�t �e�e��ts � de��ed ��t��t�� a�

The Company and its subsidiaries have established a provident fund that is a defined contribution plan. The assets

of which are held in a separate trust fund. The provident fund is funded by the contribution from employees and

the Group. Contributions to the provident fund are charged to the statement of income in the period to which they

relate.

��st�e��e�t �e�e��ts � de��ed �e�e��t ��a�

The employee benefits liabilities in relation to the severance payment under the labor law and is recognised as a

charge to results of operations over the employee’s service period. It is calculated by the estimation of the amount

of future benefit to be earned by the employee in return for the service provided to the Group through the service

period up to the retirement age and the amount is discounted to determine the present value. The reference

discount rate is the yield rate of government bonds as at the reporting date. The calculation is based on the

actuarial technique using the Projected �nit Credit �ethod.

When the employee benefits are improved, the portion of the increased benefit relating to past service rendered by

employee is recognized in the statement of income on a straight-line basis over the average period until the

benefits become vested.

When the actuarial assumptions are changed, the Company and its subsidiaries recognize actuarial gains or losses

in the profit or loss in the period in which they arise.

Provisions

� provision is recognised if, as a result of a past event, the Company and its subsidiaries have a present legal or

constructive obligation that can be estimated reliably, and it is probable that an outflow of economic benefits will

be required to settle the obligation. Provisions are determined by discounting the expected future cash flows at a

pre-tax rate that reflects current market assessments of the time value of money and the risks specific to the

liability. The unwinding of the discount is recognised as finance cost.

Treasury shares

When share capital recognised as equity is repurchased, the amount of consideration paid, including directly

attributable costs, is classified as treasury shares and recognised as a deduction from equity. �n equal amount is

appropriated from retained earnings and taken to a reserve for treasury shares within equity. When treasury shares

are sold, the amount received is recognised as an increase in equity by crediting the cost of the treasury shares


sold, calculated using the weighted average method, to the treasury shares account and transferring the equivalent

amount back from reserve for treasury shares to retained earnings. �urpluses on the sale of treasury shares are

taken directly to a separate category within equity, ‘Surplus on treasury shares’. Net deficits on sale or

cancellation of treasury shares are debited to retained earnings after setting off against any remaining balance of

surplus on treasury shares.

�evenue

�evenue excludes value added taxes and is arrived at after deduction of trade discounts and volume rebates.

�a�e �� ds a�d se��es �e�de�ed

�evenue is recognised in profit or loss when the significant risks and rewards of ownership have been transferred

to the buyer. �o revenue is recognised if there is continuing management involvement with the goods or there are

significant uncertainties regarding recovery of the consideration due, associated costs or the probable return of

goods.

�ervice revenue is recognised when services have been rendered taking into account the stage of completion.

�e�ta� ��e

�ental income from investment property is recognised in profit or loss on a straight-line basis over the term of the

lease. Lease incentives granted are recognised as an integral part of the total rental income over the term of lease.

Contingent rentals are recognised as income in the accounting period in which they are earned.

��de�d ��e

�ividend income is recognised in the statement of income on the date the Company and its subsidiaries’ right to

receive payments is established.

��te�est ��e

�nterest income is recognised in the statement of income as it accrues.

�ncome tax

�ncome tax expense for the year comprises current and deferred tax. Current and deferred tax are recognised in

profit or loss.

Current tax is the expected tax payable or receivable on the taxable income or loss for the year, using tax rates

enacted or substantively enacted at the reporting date, and any adjustment to tax payable in respect of previous

years.

�eferred tax is recognised in respect of temporary differences between the carrying amounts of assets and

liabilities for financial reporting purposes.


�eferred tax is measured at the tax rates that are expected to be applied to the temporary differences when they

reverse, using tax rates enacted or substantively enacted at the reporting date.

�n determining the amount of current and deferred tax, the Company and its subsidiaries take into account the

impact of uncertain tax positions and whether additional taxes and interest may be due. The Company and its

subsidiaries believe that its accruals for tax liabilities are adequate for all open tax years based on its assessment

of many factors, including interpretations of tax law and prior experience. This assessment relies on estimates and

assumptions and may involve a series of judgements about future events. �ew information may become available

that causes the Company and its subsidiaries to change their judgement regarding the adequacy of existing tax

liabilities� such changes to tax liabilities will impact tax expense in the period that such a determination is made.

�eferred tax assets and liabilities are offset if there is a legally enforceable right to offset current tax liabilities

and assets, and they relate to income taxes levied by the same tax authority on the same taxable entity, or on

different tax entities, but they intend to settle current tax liabilities and assets on a net basis or their tax assets and

liabilities will be realised simultaneously.

� deferred tax asset is recognised to the extent that it is probable that future taxable profits will be available

against which the temporary differences can be utilised. �eferred tax assets are reviewed at each reporting date

and reduced to the extent that it is no longer probable that the related tax benefit will be realised.

�arnings per share

The Company and its subsidiaries presents basic and diluted earnings per share (�P�) data for its ordinary shares.

�asic �P� is calculated by dividing the profit or loss attributable to ordinary shareholders of the Company and its

subsidiaries by the weighted average number of ordinary shares outstanding during the year, adjusted for own

shares held.

�oreign currencies

��e�� e�� t�a�sa�t��s

Transactions in foreign currencies are translated to Thai �aht at the foreign exchange rates ruling at the dates of

the transactions.

�onetary assets and liabilities denominated in foreign currencies at the reporting date are translated to Thai �aht

at the foreign exchange rates ruling at that date. �oreign exchange differences arising on translation are

recognised in profit or loss.

�on-monetary assets and liabilities measured at cost in foreign currencies are translated to Thai �aht using the

foreign exchange rates ruling at the dates of the transactions.

4. RELATED PARTY TRANSACTIONS

�elated parties are those parties linked to the Company and its subsidiaries as shareholders or by common


shareholders or directors. Transactions with related parties are conducted at prices based on market prices or,

where no market price exists, at contractually agreed prices.

�.� �ignificant transactions for the years ended �ecember ��, �� and �� with related parties were as follows�

�nit� �illion �aht

Consolidated �eparate

financial statements financial statements Transfer pricing policy

��

Transactions with subsidiaries

Purchases of goods and services - - �� Cost plus margin

Purchases of fixed assets - - �� s agreement

�lectricity expense - - �� Cost and cost plus gross profit

margin not more than ��

Transportation expense - - �� s agreement without contract

�anagement fee - - �� s agreement without contract

Commission and promotion expenses - - � � Contract price

�ales of goods - - �� Cost plus margin

�ales of oil - - �� Cost plus margin

Land and office rental income - - � � Contract price

�anagement service income - - � �� s agreement without contract

(�� Contract price)

�ervice income - - � - �s agreement

�tilities, transportation income - - � � Cost plus margin

and sales of supplies

�ividend income - - �� s declared

�nterest income - - � � �.�� - �.�� p.a.

(�� .�� - �.�� p.a.)

Transactions with associated companies

Purchases of goods and services �� Cost plus margin

Purchases of fixed assets � - � - �s agreement

�ales of goods �� Cost plus margin

�ervice income - � - - Cost plus margin

Consulting service income - � - � �s agreement without contract


�actory rental income - � - � Contract price

�anagement service income � � � � �s agreement without contract


�tilities, transportation income - � - � Cost plus margin





financial statements financial statements Transfer pricing policy

��

�ividend income - - �� s declared

Transactions with re�ated companies

Purchases of goods and services � � - � Cost plus margin

�ehicles maintenance expense � - � - Cost plus margin

Land rental expense and

amortisation of leasehold rights

� � - � Contract price

Car rental expense � � � � Contract price

�ales of goods � � - - Cost plus margin

Land and showroom rental income � � - - Contract price

�ervice income � - - - �s agreement

�tilities, transportation income - � - - Cost plus margin


�nterest income - � - � �.�� - �.�� p.a.

�.� �ey management personnel compensation

�ey management personnel compensation for the years ended �ecember ��, �� and �� consisted of�

�nit� �aht

Consolidated financial

statements

�eparate

financial statements

��

�hort-term benefits ��,��,�� ,��,�� ,��,�� ,��,��

Post-employment benefits (�,��,��) �,��,�� (�,��,��) �,��,��

Total key management personnel compensation ��,��,�� ,��,�� ,��,�� ,��,��

�.� �s at �ecember ��, �� and ��, the balances of the accounts between the Company and related companies

are as follows�


�nit � �aht


statements

�eparate financial

statements

��

Trade accounts recei�ab�e � re�ated parties

�ubsidiaries

Thai �ung Tools and �ies Co., Ltd. - - ��,�� ,��

Thai �.P. �uto �ervice Co., Ltd. - - �,��,�� ,��

Thai �uto Pressparts Co., Ltd. - - �,��,�� -

Thai �ltimate Car Co., Ltd. - - ��,��,�� ,��,��

- - ��,��,�� ,��,��

�ssociated companies

�elta-T� Co., Ltd. - �,��,�� - ��,��

�elta-Thairung Co.,Ltd. �,��,�� ,�� ,�� -

Thai �uto Conversion Co., Ltd. ��,�� ,�� ,�� ,��

�,��,�� ,��,�� ,�� ,��

�e�ated companies

�suzu Chaicharoenkij �otor Co., Ltd. ��,�� ,�� - -

�suzu � �otor Co., Ltd. - �� - -

Thai �.P. Corporation Co., Ltd. ��,�� ,�� - ��,��

Center Car �ent Co., Ltd. - ��,�� - ��,��

�.P. �uto �nterprise Co., Ltd. ��,�� ,�� - -

Lexus �uto City Co., Ltd. ��,�� ,�� - -

�,��,�� ,��,�� - ��,��

Total trade accounts receivable - related parties �,��,�� ,��,�� ,��,�� ,��,��

�mounts due �rom re�ated parties

�ubsidiaries

Thai �ung Tools and �ies Co., Ltd. - - ��,��,�� ,��,��

Thai �.P. �uto �ervice Co., Ltd. - - �,�� -

Thai �uto Pressparts Co., Ltd. - - �,��,�� ,��,��

Thai �ltimate Car Co., Ltd. - - �,��,�� ,��

- - ��,��,�� ,��,��


�nit � �aht


statements


statements

��

�ssociated companies

�elta - T� Co., Ltd. - �,��,�� - �,��,��

�elta-Thairung Co.,Ltd. ��,�� ,�� ,�� ,��

��,�� ,��,�� ,�� ,��,��


�suzu Chaicharoenkij �otor Co., Ltd. �,��,�� - - -

Thai �.P. Corporation Co., Ltd. ��,�� ,�� - -

Center Car �ent Co., Ltd. - ��,�� - -

�,��,�� ,�� - -

Total amounts due from related parties �,��,�� ,��,�� ,��,�� ,��,��

�hort�term �oans to re�ated parties

�ubsidiaries


Thai �uto Pressparts Co., Ltd. - - - ��,��,��

Thai �.P. �uto �ervice Co., Ltd. - - �,��,�� -

Total short-term loans to related parties - - ��,��,�� ,��,��

Trade accounts pa�ab�e � re�ated parties

�ubsidiaries

Thai �ung Tools and �ies Co., Ltd. - - �,�� -

Thai �uto Pressparts Co., Ltd. - - ��,��,�� -

- - ��,��,�� -

�ssociated compan�

�elta - T� Co., Ltd. - ��,�� - ��,��


�suzu Chaicharoenkij �otor Co., Ltd. ��,�� ,�� - -

Thai �.P. Corporation Co., Ltd. ��,�� ,�� - -

Chaicharoenkij �otor Co., Ltd. - �,�� - -

�.P. �uto �nterprise Co., Ltd. ��,�� ,�� - -


�nit � �aht


statements


statements

��

�.P.�. �uto Co., Ltd. �,�� ,�� - -

�inthoranee Property Co., Ltd. - �,�� - -

��,�� ,�� - -

Total trade accounts payable - related parties ��,�� ,�� ,��,�� ,��

�mounts due to re�ated parties

�ubsidiaries

Thai �ung Tools and �ies Co., Ltd. - - �,��,�� ,��,��

Thai �ltimate Car Co., Ltd. - - ��,��,�� ,��,��

Thai �.P. �uto �ervice Co., Ltd. - - �,��,�� ,��,��

- - ��,��,�� ,��,��


�suzu Chaicharoenkij �otor Co., Ltd. ��,�� ,�� ,�� ,��

Thai �.P. Corporation Co., Ltd. �,��,�� ,�� ,��,�� ,��

�inthoranee Co., Ltd. ��,�� - - -

Chaicharoenkij �otor Co., Ltd. - ��,�� - -

�.P. �uto �nterprise Co., Ltd. �,�� - - -

Phothiphumi Co. Ltd. ��,�� - - -

�.P. Capital �sset Co.,Ltd �,�� ,�� ,�� ,��

Lexus �uto City Co., Ltd. ��,�� ,�� ,�� ,��

�,��,�� ,��,�� ,��,�� ,��

Total amounts due to related parties �,��,�� ,��,�� ,��,�� ,��,��

�ccrued pro�ect costs to re�ated part�

�ubsidiar�


Total accrued project cost to related party - - ��,��,�� ,��,��


�.� �uring the year of ��, movements of short-term loans to and loans from related parties were as follows�


�anuary �, �uring the year �ecember ��,

�� ncrease �ecrease �� nterest rate

�hort�term �oans to re�ated parties

�eparate �inancia� statements

�ubsidiaries

Thai �ung Tools and �ies Co., Ltd. �� (��) �� .��-�.�� p.a., at call

Thai �uto Pressparts Co., Ltd. ��.� �� (��.�) - �.��-�.�� p.a., at call

Thai �.P. �uto �ervice Co., Ltd. - � - � �.�� p.a., at call

�hort�term �oans �rom re�ated part�

�eparate �inancia� statements

�ubsidiaries

Thai �.P. �uto �ervice Co., Ltd. - �� (��) - �.�� p.a., at call

�.� Guarantee �bligations with related parties

�s at �ecember ��, �� and �� the Company has outstanding guarantee obligations with subsidiaries and

associate as follows�

a) The Company has obligations of �aht �� million and �aht �� million in respect of its guarantee of credit

facilities provided by a local bank and two local banks, respectively, to Thai �.P. �uto �ervice Co., Ltd.

(a subsidiary).

b) The Company has obligations of �aht �� million and �aht �� million in respect of its guarantee of

credit facilities provided by two local banks and three local banks, respectively, to Thai �ung Tools and

�ies Co., Ltd. (a subsidiary).

c) The Company has obligations of �aht �� million and �aht �� million in respect of its guarantee of credit

facilities provided by a local bank and two local banks, respectively, to Thai �uto Pressparts Co., Ltd. (a

subsidiary).

d) The Company has obligations of �aht �� million in respect of its guarantee of credit facilities provide by

a local bank to Thai �ltimate Car Co., Ltd. (a subsidiary) together with personal guarantee by directors in

��.

f) The Company has obligations of �aht �� million, in respect of its guarantee of credit facilities provide by

a local bank to �elta Thairung Co., Ltd. (an associated).

The Company has not charged a guarantee fee to its subsidiaries and associates.

ANNUAL REPORT 2012THAI RUNG UNION CAR PUBLIC COMPANY LIMITED��

�� T�� T�� T

Trade and other receivables as at �ecember ��, �� and �� consisted of�

�nit� �aht


statements


statements

��

Trade accounts receivable � unrelated parties ��,��,�� ,��,�� ,��,�� ,��,��

Trade accounts receivable � related parties �,��,�� ,��,�� ,��,�� ,��,��

Less� �llowance for doubtful accounts (��,��) (��,��) - -

Total trade accounts receivable - net ��,��,�� ,��,�� ,��,�� ,��,��

�ther receivables

�mounts due to related parties �,��,�� ,��,�� ,��,�� ,��,��

�nput tax refundable ��,��,�� ,��,�� - ��

�nput tax suspense ��,��,�� ,��,�� ,��,�� ,��

Prepayment ��,��,�� ,��,�� ,��,�� ,��,��

�ccrued income ��,��,�� - ��,��,�� -

�ccrued interest income ��,�� ,�� ,�� ,��

�thers �,��,�� ,��,�� ,�� ,��

Total other receivables ��,��,�� ,��,�� ,��,�� ,��,��

Trade and other receivables - net ��,��,�� ,��,�� ,��,�� ,��,��

The balances of trade accounts receivable as at �ecember ��, �� and ��, aged on the basis of due dates, are

summarised below.

�nit� �aht


statements


statements

��

Trade accounts recei�ab�e � unre�ated parties

��e o� recei�ab�es

�ot yet due ��,��,�� ,��,�� ,��,�� ,��,��

Past due

�p to � months ��,��,�� ,��,�� ,��,�� ,��,��

� - � months �,��,�� ,��,�� ,�� ,��

� - �� months ��,��,�� ,�� - -

�ver �� months ��,�� ,�� - ��,��

Total ��,��,�� ,��,�� ,��,�� ,��,��

ANNUAL REPORT 2012THAI RUNG UNION CAR PUBLIC COMPANY LIMITED ��

�nit� �aht


statements


statements

��

Less� �llowance for doubtful accounts (��,��) (��,��) - -

Total trade accounts receivable - unrelated parties, net ��,��,�� ,��,�� ,��,�� ,��,��

Trade accounts recei�ab�e � re�ated parties

��e o� recei�ab�es

Trade accounts recei�ab�e � subsidiaries

�ot yet due - - �,��,�� ,��

Past due

�p to � months - - �,��,�� ,��

� - � months - - - ��,��

� - �� months - - �,��,�� ,��,��

�ver �� months - - �,��,�� ,��,��

Total trade accounts receivable - subsidiaries - - ��,��,�� ,��,��

Trade accounts recei�ab�e � associates

�ot yet due �,��,�� ,��,�� ,�� ,��

Past due

�p to � months - ��,�� - ��,��

Total trade accounts receivable - associates �,��,�� ,��,�� ,�� ,��

Trade accounts recei�ab�e � re�ated companies

�ot yet due �,��,�� ,�� - ��,��

Past due

�p to � months �,�� ,�� - -

� - � months - - - -

� - �� months - ��,�� - -

�ver �� months - ��,�� - -

Total trade accounts receivable � related companies �,��,�� ,��,�� - ��,��

Total trade accounts receivable - related parties �,��,�� ,��,�� ,��,�� ,��,��


�� T�� T

�nventories as at �ecember ��, �� and �� consisted of�

�nit� �aht

Consolidated financial statements

Cost �tock obsolescence �nventory-net

��

�inished goods ��,��,�� ,��,�� (��,��,��) (��,��,��) ��,��,�� ,��,��

Work in process ��,��,�� ,��,�� (�,��,��) (�,��,��) ��,��,�� ,��,��

�aw materials ��,��,�� ,��,�� (��,��,��) (��,��,��) ��,��,�� ,��,��

Total ��,��,�� ,��,�� (��,��,��) (��,��,��) ��,��,�� ,��,��

�nit� �aht

�eparate financial statements

Cost �tock obsolescence �nventory-net

��

�inished goods �,��,�� ,��,�� (�,��,��) (�,��,��) �,��,�� ,��,��

Work in process ��,��,�� ,��,�� (��,��) (��,��) ��,��,�� ,��,��

�aw materials ��,��,�� ,��,�� (��,��,��) (��,��,��) ��,��,�� ,��,��

Total ��,��,�� ,��,�� (��,��,��) (��,��,��) ��,��,�� ,��,��

�� T��T� �� T��

�etails of associates consisted of� �nit� �aht


statements


statements

�ature of Country of �hareholding Carrying amounts based

Company business incorporation percentage on equity method Cost

��

� �

�elta-T� Co., Ltd. �anufacture of

vehicle parts

Thailand �� ,��,�� ,��,�� ,��,�� ,��,��

Thai �uto Conversion Co., Ltd. �anufacture of

vehicle parts

Thailand �� ,��,�� ,��,�� ,��,�� ,��,��

�elta Thai�ung Co., Ltd. �anufacture of auto

seats and parts and

other equipment for

vehicles

Thailand �� ,��,�� ,��,�� ,��,�� ,��,��

Total investments in associated companies ��,��,�� ,��,�� ,��,�� ,��,��


�n the first quarter ��, the Company sells �,�� ordinary shares in Thai �uto Conversion Co., Ltd. representing

�� of the registered shares at a price of �aht �,�� per share, giving a total of �aht ��.�� million to Toyota

�uto �ody Co., Ltd. This price was calculated using the discounted cash flow method as mutual agreed by both

parties. The Company had gain on sales of common stock which was recorded in other income in the amount of

�aht �.�� million and �aht ��.�� million in consolidated financial statements and separate financial statements,

respectively. �n consequence from the sales of shares, the Company still hold �� of the registered share capital

of Thai �uto Conversion Co., Ltd.

�ccording to the minute of the shareholders general meeting for the year �� of �elta-T� Co., Ltd. dated on

�ebruary �, ��, the meeting approved to pay dividend from its retained earnings of the year �� of �aht ��

per share, totalling ��,�� shares, in the total amount of �aht �� million, the Company has �� shareholding

thus the Company has dividend income in the amount of �aht ��.�� million. �n �ebruary ��, ��, the Company

had received dividend amount of �aht �.�� million, and the remaining balance of �aht �.�� million had received

on �pril ��, ��. �n addition, according to the minute of the extraordinary shareholders meeting no. �� of

�elta-T� Co., Ltd. held on �ebruary ��, ��, the meeting appro�ed the Company’s dissolution. Currently, it is

in the process of liquidation.

�ccording to the minute of the shareholders general meeting for the year �� of Thai �uto Conversion Co., Ltd.

dated on �une �, ��, the meeting approved to pay dividend from inappropriated retained earnings as at

�ecember ��, �� to shareholders in the total amount of �ath ��.�� million. The Company has ��

shareholding, so the Company has dividend income in the total amount of �aht �.�� million. The Company

already received such dividend on �uly ��, ��.

�ccording to the minute of director meeting of �elta Thairung Co., Ltd. dated on �pril ��, ��, the meeting

approved to pay dividend to shareholders in the total amount of �aht �� million. The Company has ��

shareholding, so the Company has dividend income in the total amount of �aht �� million.

�uring the year, the Company has recognised its share of net profit from investments in associated companies in

the consolidated financial statements and dividend income in the separate financial statements as follows�

�nit� �aht

Consolidated financial statements �eparate financial statements

Company

�hare of profit (loss) from investments in

associates during the year �ividend received during the year

��

�elta-T� Co., Ltd. (�,��,��) (�,��,��) ��,��,�� ,��,��

Thai �uto Conversion Co., Ltd. ��,��,�� ,��,�� ,��,�� ,��,��

�elta Thai�ung Co., Ltd. ��,��,�� ,��,�� ,��,�� ,��,��

Total ��,��,�� ,��,�� ,��,�� ,��,��


�inancial information of the associated companies is summarised below.


Paid-up capital as at Total assets as at

Total liabilities

as at

Total revenues for

the years ended

�et profit for the

years ended

Company �ecember ��, �ecember ��, �ecember ��, �ecember ��, �ecember ��,

��

�elta-T� Co., Ltd. �� - �� (�) (�)

Thai �uto Conversion Co., Ltd. �� ,��

�elta Thai�ung Co., Ltd. �� ,��

�hares of profit from investments in three associated companies, included in the consolidated statements of

comprehensive income for the year �� and ��, amounting to �aht ��.�� million and �aht ��.�� million,

respectively, were calculated based on financial statements prepared by the management of those companies and

not audited by their auditors.

�� T��T� ��

�etails of investments in subsidiaries as presented in separate financial statements are as follows�

�nit� �aht

�hareholding �ividend received

Company’s name Paid up capital percentage Cost during the year

��

�illion �illion � �

�aht �aht

Thai �.P. �uto �ervice Co., Ltd. and �� ,��,�� ,��,�� ,��,�� ,��,��

its subsidiaries

Thai �ung Tools and �ies Co., Ltd. �� ,��,�� ,��,�� - -

Thai �uto Pressparts Co., Ltd. �� ,��,�� ,��,�� - -

Total investments in subsidiaries ��,��,�� ,��,�� ,��,�� ,��,��

�ccording to the annual general meeting of the shareholders of Thai �.P. �uto �ervice Co., Ltd. held on �pril ��,

��, approved to pay dividend from inappropriated retained earnings as at �ecember ��, �� to shareholders of

�ath �� per share, totaling number of share ��,�� shares which amounting to �ath �� million.

�� T�� T�� T��T � ��T

�ther long-term investment as at �ecember ��, �� and �� consisted of�

�nit� �aht

��

�nvestment in LP Land and �ousing �evelopment Co., Ltd. ��,�� ,��


�nit� �aht

��

Less� �llowance for impairment (��,��) (��,��)

�ther long-term investment - net - -

�� T��T ��T�� T

�nvestment properties as at �ecember ��, �� consisted of�

�nit� �aht


Land

�uilding

�uilding

improvement

Total

Cost

�s at �ecember ��, �� ,��,�� ,��,�� ,��,�� ,��,��

�ncrease - - - -

Write - off - (�,��,��) (�,��,��) (��,��,��)

�s at �ecember ��, �� ,��,�� ,��,�� ,��,�� ,��,��

�ccumulated depreciation

�s at �ecember ��, �� - (��,��,��) (��,��,��) (��,��,��)

�epreciation for the year - (�,��,��) (��,��) (�,��,��)

Write - off - �,��,�� ,��,�� ,��,��

�s at �ecember ��, �� - (��,��,��) (��,��,��) (��,��,��)

�et book value

�s at �ecember ��, �� ,��,�� ,��,�� ,��,�� ,��,��

�s at �ecember ��, �� ,��,�� ,��,�� ,��,�� ,��,��

�epreciation for the years

�� ,��,��

�� ,��,��

�nvestment property comprises a number of commercial land and building that are leased to third parties. �ach of

the leases contains an initial non-cancellable period of �-� years. �ubsequent renewals are negotiated with the

lessee.

The subsidiaries transferred building from property, plant and equipment to investment properties because the

buildings were no longer used by the subsidiaries and as such it was decided that the building would be leased to

the third party.

�s at �ecember ��, ��, subsidiaries’ company certain in�estment properties ha�e been fully depreciated but

are still in use. The original cost of those assets amounted to approximately �aht �.� million (�� aht �.�

million).


�s at �ecember ��, ��, a subsidiary’s ��hai �ltimate Car Co., �td.� land and building constructed thereon at

net book value of �aht ��.�� million has been mortgaged with a bank to secure the subsidiary’s credit facilities of

�aht �� million as granted by the bank.

�s at �ecember ��, ��, the Company’s management has not yet assessed fair �alue of such assets as they

believe that fair value has no significant difference from book value.

�� T�� T �� T � ��T

Property, plant and equipment as at �ecember ��, �� consisted of�

�nit� �aht


Land and �uildings �achinery, factory

land and building equipment �ffice �otor Work in

improvement improvement and tools equipment vehicles progress Total

�ost

�ecember ��, �� ,��,�� ,��,�� ,��,��,�� ,��,�� ,��,�� ,��,�� ,��,��,��

�cquisitions �,��,�� ,��,�� ,��,�� ,��,�� ,��,�� ,��,�� ,��,��

Transfer in (transfer out) - ��,��,�� ,��,�� ,�� - (��,��,��) -

�isposals (�,��,��) (��,��) (��,��,��) (�,��,��) (�,��,��) (�,��,��) (��,��,��)

�ecember ��, �� ,��,�� ,��,�� ,��,��,�� ,��,�� ,��,�� ,��,�� ,��,��,��

�ccumu�ated depreciation

�ecember ��, �� (��,��,��) (��,��,��) (�,��,��,��) (��,��,��) (��,��,��) - (�,��,��,��)

�epreciation for the year (��,��) (��,��,��) (��,��,��) (�,��,��) (�,��,��) - (��,��,��)

�epreciation on disposals �,��,�� ,�� ,��,�� ,��,�� ,��,�� - ��,��,��

�ecember ��, �� (�,��,��) (��,��,��) (�,��,��,��) (��,��,��) (��,��,��) - (�,��,��,��)

��owance �or impairment

�ecember ��, �� - - (��,��,��) - (��,��) - (��,��,��)

�ncrease - - - - - - -

�mortization - - �,��,�� - - - �,��,��

�ecember ��, �� - - (�,��,��) - (��,��) - (�,��,��)

�et boo� �a�ue

�ecember ��, �� ,��,�� ,��,�� ,��,�� ,��,�� ,��,�� ,��,�� ,��,��,��

�ecember ��, �� ,��,�� ,��,�� ,��,�� ,��,�� ,��,�� ,��,�� ,��,��,��

�epreciation �or the �ears

�� (�aht �� million included in manufacturing cost, and the balance in administrative expenses) ��,��,��



�nit� �aht


Land and �uildings �achinery, factory

land and building equipment �ffice �otor Work in

improvement improvement and tools equipment vehicles progress Total

�ost

�ecember ��, �� ,��,�� ,��,�� ,��,��,�� ,��,�� ,��,�� ,��,�� ,��,��,��

�cquisitions �,��,�� ,��,�� ,��,�� ,��,�� ,��,�� ,��,�� ,��,��

Transfer in (transfer out) - ��,�� ,��,�� - - (��,��,��) -

�isposals (�,��,��) (��,��) (��,��,��) (�,��,��) (�,��,��) (��,��) (��,��,��)

�ecember ��, �� ,��,�� ,��,�� ,��,��,�� ,��,�� ,��,�� ,��,�� ,��,��,��

�ccumu�ated depreciation

�ecember ��, �� (��,��,��) (��,��,��) (�,��,��,��) (��,��,��) (��,��,��) - (�,��,��,��)

�epreciation for the year (��,��) (�,��,��) (��,��,��) (�,��,��) (�,��,��) - (��,��,��)

�epreciation on disposals �,��,�� ,�� ,��,�� ,��,�� ,��,�� - ��,��,��

�ecember ��, �� -

��owance �or impairment

�ecember ��, �� - - (��,��,��) - (��,��) - (��,��,��)

�ncrease - - - - - - -

�mortization - - �,��,�� - - - �,��,��

�ecember ��, �� - - (�,��,��) - (��,��) - (�,��,��)

�et boo� �a�ue

�ecember ��, �� ,��,�� ,��,�� ,��,�� ,��,�� ,��,�� ,��,�� ,��,��

�ecember ��, �� ,��,�� ,��,�� ,��,�� ,��,�� ,��,�� ,��,�� ,��,��

�epreciation �or the �ears



�s at �ecember ��, ��, certain plant and equipment items have been fully depreciated but are still in use. The

original cost of those assets amounted to approximately �aht �,�� million (�� aht �,�� million) (�eparate

financial statements� �aht �,�� million, (�� aht �,�� million)).

�� T��

�eferred tax as at �ecember ��, �� and �� consisted of�

�nit� �aht


��

�eferred tax assets ��, , ��,��,�� ,��,�� ,��,��

�eferred tax liabilities (�,��,��) (�,��,��) (�,��,��) (��,��)


�ovements in deferred tax assets and deferred tax liabilities during the year were as follows�

�nit� �aht


�anuary

�, ��

Profit

(loss)

�ecember

��, ��

�anuary

�, ��

Profit

(loss)

�ecember

��, ��

�eferred tax assets

�llowance for decline in value

of inventory

��,��,�� (�,��,��) �,��,�� ,��,�� (�,��,��) �,��,��

�llowance for impairment of

investment

�,�� - �,�� ,�� - �,��


of fixed assets

- ��,�� ,�� - ��,�� ,��

�llowance for bad debt ��,�� ,�� ,�� - - -

Provision for employee benefit

liabilities

�,��,�� (�,��,��) �,��,�� ,��,�� (��,��) �,��,��

Provision for liabilities - ��,�� ,�� - - -

Loss carry forward ��,��,�� (��,��,��) ��,�� ,��,�� (�,��,��) -

Total ��,��,�� (��,��,��) ��,��,�� ,��,�� (�,��,��) �,��,��

�eferred tax liabilities

�epreciation (�,��,��) (�,��,��) (�,��,��) (��,��) (��,��) (�,��,��)

Total (�,��,��) (�,��,��) (�,��,��) (��,��) (��,��) (�,��,��)

�nit� �aht


�anuary

�, ��

Profit

(loss)

�ecember

��, ��

�anuary

�, ��

Profit

(loss)

�ecember

��, ��

(�estated) (�estated)

�eferred tax assets


of inventory

��,��,�� (�,��,��) ��,��,�� ,��,�� (��,��) �,��,��

�llowance for impairment of

investment

�,�� (�,��) �,�� ,�� (�,��) �,��

�llowance for bad debt - ��,�� ,�� - - -

Provision for employee benefit

liabilities

��,��,�� (�,��,��) �,��,�� ,��,�� (��,��) �,��,��

Loss carry forward ��,��,�� (��,��,��) ��,��,�� ,��,�� (��,��,��) �,��,��

Total ��,��,�� (��,��,��) ��,��,�� ,��,�� (��,��,��) ��,��,��

�eferred tax liabilities

�epreciation - (�,��,��) (�,��,��) - (��,��) (��,��)

Total - (�,��,��) (�,��,��) - (��,��) (��,��)


�� T�� T ��T�

�ther non-current assets as at �ecember ��, �� and �� consisted of�

�nit� �aht


financial statements financial statements

��

Land and building leasehold rights - net �,��,�� ,��,�� - -

Withholding tax deducted at source ��,��,�� ,��,�� ,��,�� ,��,��

�eferred cost of dies - net ��,��,�� ,��,�� ,��,�� ,��,��

�ther non-current assets ��,��,�� ,��,�� ,��,�� ,��,��

Total ��,��,�� ,��,�� ,��,�� ,��,��

�� T��

�s at �ecember ��, ��, the Company and its subsidiaries have bank overdraft facilities and other short-term

loan facilities amounting to �aht �� million and �aht �,�� million, respectively (�eparate financial statements�

�aht �� million and �aht �� million, respectively) which are guaranteed by the Company and its directors, and

secured by the mortgage of land with structures thereon of the subsidiary.

�� T�� T��

Trade and other payables as at �ecember ��, �� and �� consisted of�

�nit� �aht



��

Trade accounts payable � unrelated parties ��,��,�� ,��,�� ,��,�� ,��,��

Trade accounts payable � related parties ��,�� ,�� ,��,�� ,��

Total trade accounts payable ��,��,�� ,��,�� ,��,�� ,��,��

�ther payables � related parties �,��,�� ,��,�� ,��,�� ,��,��

�ther payables � unrelated parties ��,��,�� ,��,�� ,��,�� ,��,��

�ccrued expenses ��,��,�� ,��,�� ,��,�� ,��,��

�ccounts payable � �evenue �epartment �,��,�� ,��,�� ,��,�� ,��,��

�dvance from customers �,��,�� ,��,�� ,��,�� -

�utput tax suspense ��,��,�� ,��,�� ,��,�� ,��,��

�ccrued project costs � unrelated parties ��,��,�� ,��,�� - -


�nit� �aht



��

�ccrued project costs � related party - - ��,��,�� ,��,��

�thers ��,��,�� ,��,�� ,��,�� ,��,��

Total other payables ��,��,�� ,��,�� ,��,�� ,��,��

Total trade and other payables ��,��,�� ,��,�� ,��,�� ,��,��

�� T� ��T��

�mployee benefits obligation in the statements of financial position as at �ecember ��, �� and �� consisted

of�

�nit� �aht

Post-employment benefit plan


��

Present value of obligation ��,��,�� ,��,�� ,��,�� ,��,��

The Company and its subsidiaries made defined benefit plan in accordance with severance payment as the labor

law which entitled retired employee within work service period in various rates, such as more than �� years to

receive severance payment not less than �� days or �� months of the last month salary.

�ovement of the present value of employee benefits obligation for the years ended �ecember ��, �� and ��

as follows�

�nit� �aht



��

�mployee benefits obligation as at �anuary �, ��,��,�� ,��,�� ,��,�� ,��,��

�enefit paid (��,��) (�,��,��) (��,��) -

Current service cost (�,��,��) ��,��,�� (��,��) �,��,��

�nterest cost (�,��,��) �,��,�� (��,��) �,��,��

�mployee benefits obligation as at �ecember ��, ��,��,�� ,��,�� ,��,�� ,��,��

�mployee benefit expenses in the statements of comprehensive income for the years ended �ecember ��, ��

and �� consisted of�


�nit� �aht



��

Current service cost (�,��,��) ��,��,�� (��,��) �,��,��

�nterest from obligation (�,��,��) �,��,�� (��,��) �,��,��

Total employee benefits expenses (�,��,��) ��,��,�� (��,��) �,��,��

�mployee benefit expenses for the years ended �ecember ��, �� and �� as shown in the statements of

comprehensive income are as follows�

�nit� �aht



��

Cost of sales ��,�� ,�� ,�� ,��,��

�elling expenses (��,��) (��,��) ��,�� (��,��)

�dministrative expenses (�,��,��) ��,��,�� (�,��,��) �,��,��

Total employee benefit expenses (�,��,��) ��,��,�� (��,��) �,��,��

Principal actuarial assumptions as at �ecember ��, �� and �� (expressed as weighted averages) as follows�

Consolidated and separate


�iscount rate at �ecember ��

�uture salary increases ��

�ortality rate �ortality table year ��

The actuarial assumption of discount rate is estimated from weighted average of yield rate of government bonds

as at the end of reporting date that reflects the estimated timing of benefit payments.

The actuarial assumption of mortality rate for reasonable estimation of probability of retirement in the future is

estimated from mortality table.

�� T��

�ccording to the board of directors’ meeting of the Company No.�� held on �ay �, ��, the Company’s

directors resolved to approve the share repurchase program for financial management purpose in accordance with

the �ection ��(�) of the Public Limited Company �ct (�o. �) �.�. �� in the amount not exceeding �aht ��


million. The number of ordinary shares to be repurchased is not exceeding ��.�� million shares (par value of �aht

� per share)� equal to �� of the total number of paid-up share capital of the Company. The Company shall

repurchase its ordinary shares through the main board of the �tock �xchange of Thailand during the period from

�ay ��, �� to �ovember ��, ��, the Company determine the share resale procedures through the �tock

�xchange of Thailand, or by public offering and the period for share resale within � years and � months after the

date of completion of repurchase.

The Company repurchased a total of �,��,�� ordinary shares during the period from �ay ��, �� to

�ovember ��, ��, for a total consideration of �aht ��.�� million and during the same period the Company

appropriated �aht ��.�� million from its retained earnings as a treasury shares reserve for the repurchased shares.

��

�eserves comprise�

��at��s �� t a�d�� eta��ed ea��s

Legal reserve

�ection �� of the Public Companies �ct �.�. �� ection �� requires that a public company shall allocate not

less than �� of its annual net profit, less any accumulated losses brought forward, to a reser�e account ��legal

reser�e��, until this account reaches an amount not less than �� of the registered authorised capital. �he legal

reserve is not available for dividend distribution.

Treasury shares reserve

The treasury shares reserve represents the amount appropriated from retained earnings equal to the cost of the

Company’s own shares held by the Company. �he treasury shares reser�e is not a�ailable for di�idend

distribution.

�� T��

�ther income for the years ended �ecember ��, �� and �� consisted of�

�nit� �aht


��

�crap sales ��,��,�� ,��,�� ,��,�� ,��,��

�nterest income �,��,�� ,��,�� ,��,�� ,��,��

�tilities, transportation service

and sales of supplies �,��,�� ,��,�� ,��,�� ,��,��

�ental fee �,��,�� ,��,�� ,��,�� ,��,��

Consulting fee - �,��,�� - �,��,��

Gain on sales of investment in associated company �,��,�� - ��,��,�� -


�nit� �aht


��

�thers ��,��,�� ,��,�� ,��,�� ,��,��

Total ��,��,�� ,��,�� ,��,�� ,��,��

�� T��

�ignificant expenses by nature are as follows�

�nit� �aht


��

�alary and wages and other

employee benefits ��,��,�� ,��,�� ,��,�� ,��,��

�epreciation and amortization ��,��,�� ,��,�� ,��,�� ,��,��

�aw materials and consumables used �,��,��,�� ,��,��,�� ,��,��,�� ,��,��

Changes in inventories of finished

goods and work in process ��,��,�� ,��,�� ,��,�� (�,��,��)

�� T��

�ncome tax expenses for the years ended �ecember ��, �� and �� consisted of�

�nit� �aht


��

��e�t ta� e��e�se

Current period (��,��,��) (�,��,��) (��,��,��) -

�e�e��ed ta� e��e�se

�ovements in temporary differences (�,��,��) �,��,�� (�,��,��) �,��,��

�enefit of tax losses recognised (��,��,��) (��,��,��) (�,��,��) (��,��,��)

�ncome tax reduction - (��,��,��) - (�,��,��)

(��,��,��) (��,��,��) (�,��,��) (��,��,��)

Total (��,��,��) (��,��,��) (��,��,��) (��,��,��)

�econciliation of effective tax rate



��

�ate

(�)

�nit� �aht

�ate

(�)

�nit� �aht

Profit before total income tax expense ��,��,�� ,��,��

�ncome tax using the corporate tax rate �arious rate ��,��,�� arious rate ��,��,��

�ffect from difference of tax rate �,��,�� -

�ncome tax reduction - deferred - ��,��,��

�ncome not subject to tax (��,��,��) (��,��,��)

�xpenses not deductible for tax purposes (�,��,��) (��,��)

�ecognition of previously unrecognised tax losses ��,�� (�,��,��)

Total ��.�� ,��,�� .�� ,��,��


��

�ate

(�)

�nit� �aht

�ate

(�)

�nit� �aht

Profit before total income tax expense ��,��,�� ,��,��

�ncome tax using the corporate tax rate �� ,��,�� ,��,��

�ffect from difference of tax rate (�,��,��) -

�ncome tax reduction - deferred - �,��,��

�ncome not subject to tax (��,��,��) (��,��,��)

�xpenses not deductible for tax purposes ��,�� ,��

�ecognition of previously unrecognised tax losses ��,�� (�,��,��)

Total ��.�� ,��,�� .�� ,��,��

��

��e ta� �ed��t��

�oyal �ecree �o. �� .�. �� dated �ecember ��, �� grants a reduction in the corporate income tax rate

from �� to �� on net profit for the accounting period beginning on or after �anuary �, ��, and will be

reduced to �� on net profit for the two consecutive accounting periods beginning on or after �anuary �, ��

onwards.

��

�oyal �ecree �o. �� .�. �� dated � �ugust �� grants companies listed on the �tock �xchange of Thailand

a reduction in the corporate income tax rate from �� to �� for taxable profit not exceeding �aht �� million

for the three consecutive accounting periods beginning on or after �anuary �, ��.


The current tax expense in the statement of comprehensive income is less than the amount determined by

applying the corporate tax rate to the accounting profit for the period principally because�

(a) � significant portion of subsidiaries’ profit was deri�ed from promoted acti�ities for which concessionary

tax rates apply.

(b) The Company and its subsidiaries have unutilised tax losses brought forward from the previous year which

have been utilised during the period to set-off against the current year�s tax charge.

� subsidiary has been granted the promotional privileges discussed in �ote ��, including exemption from

corporate income tax on net income from promoted activities.

�� T��

� subsidiary was granted investment promotional privileges by the �oard of �nvestment (��). �ajor privileges

are summarised below�

�xemption from �� reduction of corporate income tax rate for � years commencing from �une �, �� for the

manufacture of metal vehicle body parts, plastic and fiber glass vehicle parts, and the manufacture and

maintenance of molds and jigs.

�s from �arch ��, ��, a subsidiary has received promotional privileges from the �oard of �nvestment for the

manufacture of assembly parts pursuant to the promotion certificate �o. �� (�)�� issued on �ay ��, ��.

�uch subsidiary has started generating revenues since �pril �, ��.

��

�asic earnings per share is calculated by dividing net profit for the year by the weighted average number of

ordinary shares in issue during the year.

�nit ��aht



��

Profit for the years attributable to equity

holders of the Company ��,��,�� ,��,�� ,��,�� ,��,��

Weighted average number of shares outstanding during the years ended �ecember ��, �� and �� calculated as

follows


�nit � Thousand shares



��

�t �anuary �, ��,�� ,�� ,�� ,��

Weighted average number of treasury shares

outstanding during the years - (�,��) - (�,��)

Weighted average number of ordinary shares

outstanding during the years ��,�� ,�� ,�� ,��

�� T ��T��

�he Company’s and its subsidiaries’ business operations involve three principal segments� (�) car assembly and

other related car services (�) manufacture of equipment for production of car accessories (comprising the

manufacture of molds and jigs and manufacture and sales of car accessories and spare parts) and (�) sales of cars,

car service centre business. These operations are mainly carried on in Thailand. �elow is the consolidated

financial information for the years ended �ecember ��, �� and �� of the Company and its subsidiaries by

segment.

�nit � �illion �aht

Car assembly

and other

related car

services

�anufacture of

equipment for

production of car

accessories

�ales of cars

and car

service centre �ther

�limination

of inter-

segment

revenues Consolidation

��

�evenue from external customers �,�� ,�� ,�� - - �,�� ,��

�ntersegment revenues � � �� (��) (��) - -

Total revenues �,�� ,�� ,�� (��) (��) �,�� ,��

�egment income �� - �� (��) (��) ��

�nallocated income and expenses�

�ther income ��

�elling expenses (��) (��)

�dministrative expenses (��) (��)

�hare of profit from investments in associated companies ��

Corporate income tax (��) (��)

�et profit ��

�nvestment property - - - - �� - - ��

Property, plant and equipment �� (�) (�) �,�� ,��

�nallocated assets �,�� ,��

Total assets �,�� ,��


�he Company’s and its subsidiaries’ transfer prices between business segments are described in �ote �.

�n �ebruary ��, ��, Thai �ltimate Car Co., Ltd. (�ubsidiary held by Thai �.P. �uto �ervice Co., Ltd.) had

registered to engage more services operation which are the services in legal, accounting, commercial, industrial,

and such services and others related to business and tax administration of large organization.

�� T ��

The Company and its subsidiaries and their employees have jointly established a provident fund in accordance

with the Provident �und �ct �.�. ��. The funds are monthly contributed to by employees at the rates of �-�

percent of their salaries, and by the Company and its subsidiaries at the rates of �-�� percent of the employees’

contribution. The fund is managed by C�� Thai �ank Public Company Limited, except that of a subsidiary

(Thai �ltimate Car Co., Ltd.) is managed by �asikorn �sset �anagement Co., Ltd. The funds will be paid to the

employees upon termination in accordance with the rules of the funds. �uring the year ��, the Company and its

subsidiaries contributed �aht � million (�� aht � million) to the funds.

��

�ccording to the annual general meeting of the shareholders of the Company on �pril ��, ��, the shareholders

approved the appropriation of dividend for the year �� of �aht �.�� per share, amounting to �aht ��.��

million.

�ccording to the annual general meeting of the shareholders of the Company for the year �� held on �pril ��,

��, the shareholders approved the appropriation of dividend for the year �� of �aht �.�� per share,

amounting to �aht ��.�� million. The dividend was paid to shareholders within �ay ��, ��.

�� T��T� �� T��T ��T��

��.� �perating lease commitments

The Company and its subsidiaries have entered into several lease agreements in respect of the lease of land, office

building space, motor vehicles and equipment. �s at �ecember ��, ��, future minimum lease payments

required under these operating lease contracts were as follows.

�nit� million �aht

Consolidated



statements

Payable

Within � year �.� -

� to � years �.� -


��.� �ank guarantees

�s at �ecember ��, ��, the Company and its subsidiaries have outstanding bank guarantees issued by banks as

follows�


statements


statements

(�nit� million �ollars) (�nit� million �aht) (�nit� million �aht)

Purchase of goods �.�� - -

�lectricity use, among others - ��.�� .��

�� T��T�

��.� �inancial risk management

�he Company’s and its subsidiaries’ financial instruments, as defined under �hai �ccounting Standard �o. ��

��inancial �nstruments� �isclosure and �resentations�, principally comprise cash and cash equi�alents, trade

accounts receivable, other receivables, loans, investments, trade accounts payable and other payables. The

financial risks associated with these financial instruments and how they are managed is described below.

��ed�t ��s�

The Company and subsidiaries are exposed to credit risk primarily with respect to trade accounts receivable,

loans, and other receivables. The Company and subsidiaries manage the risk by adopting appropriate credit

control policies and procedures and therefore does not expect to incur material financial losses. �n addition, the

Company and its subsidiaries do not have high concentration of credit risk since they have a large customer base.

The maximum exposure to credit risk is limited to the carrying amounts of receivables, loans, and other

receivables as stated in the �tatement of financial position.

��te�est �ate ��s�

�he Company’ and subsidiaries’ e�posures to interest rate risk relate primarily to their cash at banks, current

investments and short-term loans. �owe�er, since most of the Company’s and subsidiaries’ financial assets and

liabilities have been repaid within one year, the interest rate risk is expected to be minimal.

��e�� e�� s�

� subsidiary’s e�posures to foreign currency risk arise mainly from trading transactions that are denominated in

foreign currencies. The subsidiary seeks to reduce this risk by entering into forward exchange contracts when it

considers appropriate. Generally, the forward contracts mature within one year.

��.� �air values of financial instruments

Since the ma�ority of the Company’s and subsidiaries’ financial instruments are short-term in nature, and current


investments and loans bear interest at rates close to market rate, their fair value is not expected to be materially

different from the amounts presented in the �tatement of financial position.

� fair value is the amount for which an asset can be exchanged or a liability settled between knowledgeable,

willing parties in an arm’s length transaction. �he fair �alue is determined by reference to the market price of the

financial instrument or by using an appropriate valuation technique, depending on the nature of the instrument.

�� T�� T

�he primary ob�ecti�es of the Company’s capital management is to ensure that it has an appropriate financing

structure and preserves the ability to continue its business as a going concern.

�ccording to the �tatement of financial position as at �ecember ��, ��, the Company’s and its subsidiaries’

debt-to-equity ratio was �.�� .�� and the Company’s was �.�� .��.

�� T�� T�

Certain accounts in the statement of financial position as at �ecember ��, �� and the statement of

comprehensive income for the year ended �ecember ��, ��, which are included in the �� financial

statements for comparative purposes, have been reclassified to conform to the presentation in the �� financial

statements.

�nit� �aht


�efore

reclassify

�eclassify �fter

reclassify

Property, plant and equipment - net �,��,��,�� (�,��,��) �,��,��,��

�ntangible assets - net - �,��,�� ,��,��

-

Cost of sales �,��,��,�� ,��,�� ,��,��,��

Cost of rendering of services ��,��,�� (��,��,��) ��,��,��

�elling expenses ��,��,�� ,��,�� ,��,��

�dministrative expenses ��,��,�� (�,��,��) ��,��,��

-


�nit� �aht


�efore

�eclassify

�eclassify

�fter

�eclassify

Property, plant and equipment - net ��,��,�� (�,��,��) ��,��,��

�ntangible assets - net - �,��,�� ,��,��

�ther non-current assets - net ��,��,�� ,��,�� ,��,��

Trade and other payables (��,��,��) (��,��,��) (��,��,��)

-

�elling expenses ��,��,�� ,��,�� ,��,��

�dministrative expenses ��,��,�� (��,��,��) ��,��,��

-

�� T�T��T�

�hese financial statements were authorised for issue by the Company’s �oard of �irectors on �ebruary ��, ��.


Documents

Annual Report 2012 EN