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BAKER TECHNOLOGY LIMITED ANNUAL REPORT 2012
BAKER TECHNOLOGY LIMITED ANNUAL REPORT 2012
For the financial year ended 31december 2012
Independent
auditor’sreport
For the financial year ended 31december 2012
Independent
auditor’sreport
To theMembersofBaker Technology Limited
Report on the financial statements
We have audited the accompanying financial statements of Baker Technology Limited (the “Company”) and its
subsidiaries (collectively, the “Group”) set out on pages 72 to 143, which comprise the balance sheets of theGroup
and the Company as at 31 December 2012, the statements of changes in equity of the Group and the Company,
and the statement of comprehensive income and statement of cash flows of theGroup for the year then ended, anda
summary of significant accounting policies and other explanatory information.
Management’s responsibility for the financial statements
Management is responsible for the preparation of financial statements that give a true and fair view in accordance
with the provisions of the Singapore Companies Act, Chapter 50 (the “Act”) and Singapore Financial Reporting
Standards, and fordevisingandmaintaininga systemof internal accountingcontrols sufficient toprovidea reasonable
assurance that assetsare safeguardedagainst loss fromunauthoriseduseor disposition, and transactionsareproperly
authorisedand that they are recordedas necessary to permit the preparation of true and fair profit and loss accounts
and balance sheets and tomaintain accountability of assets.
Auditor’s responsibility
Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our
audit in accordance with Singapore Standards on Auditing. Those standards require that we comply with ethical
requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements
are free frommaterial 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 of the financial statements that give a true
and fair view 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 bymanagement,
as well as evaluating the overall presentation of the financial statements.
Webelieve that theaudit evidencewe have obtained is sufficient andappropriate toprovideabasis for our qualified
audit opinion.
Basis for qualified opinion
As disclosed inNote3.1(b) to the financial statements, in2010, theGroupwas not able toobtain the financial results
of PPL Shipyard Pte Ltd (“PPLS”) for the period from 1 January 2010 to 26 October 2010 (date of disposal). The
Group’s share of PPLS’s results of $15,823,500 recognised in the consolidated statement of comprehensive income
for the financial year ended 31 December 2010was based on the interim dividend received by theGroup in April
2010. This amount was also included in theGroup’s retained earnings as at 31December 2010, and31December
2011 and the opening retained earnings for the current financial year ended 31December 2012.
Basis for qualified opinion(cont’d)
In addition, as disclosed inNote25 to the financial statements, theGroup had recordedan amount of $58,237,148
as deferred gain on disposal of the investment in PPL Holdings Pte Ltd (“PPLH”), which held the 15% shareholding
in PPLS, in its consolidated balance sheet as at 31 December 2011. As discussed in that note, management had
deferred the recognition of this gain due to the pending outcome of the legal case then. The legal casewas finalised
during the current financial year andmanagement has recognised this amount in theGroup’s consolidatedprofit and
loss for the current financial year.
Our audit opinion on the financial statements for the year ended 31 December 2011 was modified because we
were unable to carry out audit procedures necessary to satisfy ourselves on the appropriateness of the $15,823,500
included in the Group’s retained earnings as at 31 December 2011, and the appropriateness of the deferred gain
of $58,237,148 recorded in theGroup’s balance sheet for that year as the $15,823,500was also used to compute
the deferred gain amount.
Consequently, any changes required to the shareof PPLS’s results recognised in thefinancial year ended31December
2010will result in a change to the gain on disposal on $58,237,148 recognised in theGroup’s consolidated profit
and loss for the current financial year.
Qualified opinion
In our opinion, except for the possible effects of the matter described in the Basis for QualifiedOpinion paragraphs
on the Group’s consolidated statement of comprehensive income, statement of changes in equity and cash flow
statement, the consolidated financial statements of the Group and the balance sheet and statement of changes in
equity of theCompany are properly drawn up in accordancewith the provisions of theAct and Singapore Financial
Reporting Standards so as to give a true and fair view of the state of affairs of theGroup and of the Company as at
31 December 2012 and of the results, changes in equity and cash flows of theGroup and the changes in equity of
theCompany for the year ended on that date.
Report on other legal and regulatory requirements
In our opinion, the accounting and other records required by theAct to be kept by theCompany and by subsidiaries
incorporated in Singapore of which we are the auditors have been properly kept in accordance with the provisions
of the Act.
Ernst & Young LLP
Public Accountants andCertified Public Accountants
Singapore
19March 2013
