Asian American Medical Group Limited
ABN NUMBER 42 091 559 125
Annual report for the year ended 31 August 2016
Dedicated to healing
Powered by Innovation
page 02 | AAMG annual report 2016
contents
05 Corporate directory
06 Corporate profile
08 Key milestones
10 Chairman’s message
12 Profile of Board of Directors
15 Profile of Doctors and Key Management
17 Financial review
20 Patient’s testimonials
22 Corporate governance statement
27 Directors’ Report
38 Auditor’s Independence Declaration
40 Consolidated statement of profit or loss and other
comprehensive income
42 Consolidated statement of financial position
43 Consolidated statements of changes in equity
44 Consolidated statement of cash flows
45 Notes to the financial statements
86 Directors’ Declaration
87
Independent Auditor’s Report
90 Shareholder information
AAMG annual report 2016 | page 03
page 04 | AAMG annual report 2016
corporate directory
BOARD OF DIRECTORS
Dato’ Dr Kai Chah Tan (Executive Chairman)
Mr Evgeny Tugolukov (Non-Executive Director)
Mr Kong Meng Ang (Non-Executive Director)
Mr Heng Boo Fong (Independent Non-Executive Director)
Mr Paul Vui Yung Lee (Independent Non-Executive Director)
Ms Jeslyn Jacques Wee Kian Leong (Independent Non-Executive Director)
AUDIT COMMITTEE
Mr Heng Boo Fong (Chairman)
Mr Paul Vui Yung Lee
Ms Jeslyn Jacques Wee Kian Leong
NOMINATION AND REMUNERATION COMMITTEE
Mr Heng Boo Fong (Chairman)
Mr Paul Vui Yung Lee
Mr Evgeny Tugolukov
COMPANY SECRETARY
Dario Nazzari
REGISTERED OFFICE
25 Peel Street
Adelaide SA 5000
Tel: +61 8 8110 0999
Fax: +61 8 8110 0900
Website: www.aamg.co
AUDITORS
Grant Thornton Audit Pty Ltd
Level 1, 67 Greenhill Road
Wayville SA 5034
Tel: +61 8 8372 6666
Fax: +61 8 8372 6677
BANKERS
DBS Bank Ltd
12 Marina Boulevard
DBS Asia Central, Marina Bay Financial Centre Tower 3
Singapore 018982
Westpac Banking Corporation
114 William Street
Melbourne VIC 3000
SHARE REGISTRY
Computershare Investor Services Pty Ltd
Level 5, 115 Grenfell Street
Adelaide SA 5000
Tel: +61 8 8236 2300
Fax: +61 8 9473 2408
STOCK EXCHANGE LISTING
The Company’s shares are quoted on the Official List of the Australian Securities
Exchange Limited.
ASX Code : AJJ
AAMG annual report 2016 | page 05
Corporate profile
Asian American Medical Group (“AAMG”) is based
in Singapore and has been listed on the Australian
Securities Exchange since September 2009. The
Group’s operations include the Asian American
Liver Centre Pte Ltd (“AALC”), established in
1994 in Singapore, and Asian American Radiation
Oncology Pte Ltd (“AARO”), established in 2015.
The Group entered into a strategic collaboration
in October 2012 with U.S.-based US$13-billion
integrated global health enterprise University
of Pittsburgh Medical Centre (“UPMC”). UPMC,
ranked No. 12 on the U.S. News & World Report
Honor Roll of American’s Best Hospitals,
is
affiliated with the University of Pittsburgh Schools
of the Health Sciences and is a pioneer in the
field of transplantation. This collaboration has
enhanced AAMG’s clinical capabilities through
shared protocols, rigorous quality standards and
technology and also created a platform for AAMG
to expand into other countries in Asia such as
Malaysia and Myanmar.
AALC, one of Asia’s foremost liver centres, is
led by renowned hepatobiliary expert and liver
transplant surgeon, Dato’ Dr Kai Chah Tan (“Dr
KC Tan”), who helped start the Liver Transplant
Programme at King’s College Hospital in London,
U.K., and pioneered the highly successful Living
Donor Liver Transplantation (“LDLT”) Programme
in Singapore. In 2014, AALC begun conducting
surgical procedures at iHEAL Medical Centre in
Kuala Lumpur, Malaysia.
radiation oncology
AARO offers
clinical,
consultancy and management services and is
spearheaded by Dr Daniel Yat Harn Tan. Based
in Singapore, AARO will drive expansion into the
growing radiotherapy and oncology segment
in the overseas market, at a time where there is
a shortage of modern radiotherapy treatment
centres.
page 06 | AAMG annual report 2016
CORPORATE PROFILE
Our Vision
To develop AAMG into an international healthcare brand through organic growth and geographical expansion.
Our Mission
To deliver excellent multi-disciplinary medical care through clinical excellence, technological innovation and
patient-centric care.
Our Values
Excellence We always strive to excel and take pride in all that we do.
Innovation We practice the most up-to-date clinical techniques, employ the latest technology and keep
abreast of advancements in medical treatment.
Integrity
Honesty and integrity are fundamental to our organisation. We pride ourselves on our ethical
conduct and comply strictly with legal requirements.
Transparency We carefully communicate to our patients what their care will entail, so that they clearly
understand the medical process.
We regularly publish and present our clinical outcomes.
Compassion
Patients are our top priority and we work hard to meet their diverse needs. Empathy and
compassion are integral to our mission to provide the best quality care.
Key business segments
LIVER
RADIATION ONCOLOGY
AAMG’s liver segment operates
under AALC and is headquartered
at Gleneagles Hospital
in
Singapore. Today, AALC is one
of Asia’s foremost lever centres
dedicated to the treatment of
all liver, pancreas and bile duct
diseases in adults and children,
and has expanded to Malaysia
and Myanmar.
is a
sub-specialised
AARO
radiation oncology division of
AAMG. AARO provides radiation
therapy treatment as well as
management
advisory
services to radiation oncology
units in Asia. It currently has
collaborations with medical
institutions in Myanmar, Russia
and Japan.
and
HEALTHCARE MANAGEMENT
AND CONSULTANCY
the
experience,
pool
rich
Leveraging
of
knowledge
and network of AAMG’s key
management team, the Group’s
healthcare management and
consultancy segment aims to
identify potential
source and
healthcare-related projects
in
which AAMG can participate.
AAMG annual report 2016 | page 07
Key Milestones
1990 - 2011
1990
1991
1992
1993
1994
1995
1997
2002
The world's first heart-and-liver transplant performed
by Dato’ Dr KC Tan
First split-liver transplant in the U.K. by Dato’ Dr KC Tan
First auxiliary liver transplant for liver failure in the U.K.
by Dato’ Dr KC Tan
First paediatric living donor liver transplant (“LDLT”) in the U.K. and
Second auxiliary liver transplant for metabolic disease in the world
by Dato’ Dr KC Tan
AALC, formerly known as Asian Centre for Liver Diseases &
Transplantation (”ACLDT”) is established by Dato’ Dr KC Tan
First paediatric LDLT in Southeast Asia by Dato’ Dr KC Tan
Second split-liver transplant in Asia by Dato’ Dr KC Tan
First successful adult LDLT in Southeast Asia by Dato’ Dr KC Tan
2004 - 2006 Performed first liver transplants for patients from Pakistan,
Sri Lanka, Myanmar, Bangladesh and the United Arab Emirates
in our centre by Dato’ Dr KC Tan
2007
2009
2010
2011
First private medical centre to successfully perform the 100th LDLT
in Asia
Listed on the Australian Securities Exchange (“ASX”), stock code
AJJ
First healthcare company in Singapore to use remote patient
monitoring devices for the Intensive Care Unit
Established its first satellite clinic, which incorporated telemedicine
services, in Ho Chi Minh City, Vietnam.
Entered into a Management Services Agreement with Parkway
Hospitals to co-manage Gleneagles Hospital’s liver diseases clinical
program.
2012
Signed Service Agreement with UPMC, a top Global Healthcare
Enterprise based in Pittsburgh, U.S.
First private medical centre to successfully perform the
200th LDLT in Asia
Signed Consultancy Agreement with iHEAL Medical Services to
practice at iHEAL Medical Centre in Kuala Lumpur, Malaysia.
2013
Established Haematopoietic Stem Cell Transplant centre which offers
treatment for other blood related diseases.
Signed Service Agreement with Vinmec International Hospital to set up a liver
clinic in Hanoi, Vietnam
Successful placement of 21,000,000 new shares to RusSing Med Holdings.
Creation of new brand corporate identity, renamed Asian American Medical
Group (“AAMG”)
page 08 | AAMG annual report 2016
2016
Successful placement of 57,000,000 new shares to
a group of sophisticated investors
Opening of the Pinlon Gastrointestinal & Liver
Centre (“PGLC”) in Yangon, Myanmar.
Signing of a Services Agreement between AARO
and Japan’s Jisenkai Medical Corporation Aizawa
Hospital following an earlier MOU.
Signed Collaboration Agreement with the Tunku
Laksamana Johor Cancer Foundation to jointly
assess the feasibility of setting up a cancer research
and treatment centre in Johor, Malaysia.
2015
Successful placement of 30,000,000 new shares to a group of
sophisticated investors
Set up a Radiation Oncology division, Asian American Radiation
Oncology Pte Ltd (“AARO”), led by Dr Daniel Tan Yat Harn
Entered into agreement with Rich Tree Land to provide Consultancy
Services as Project Lead Manager for proposed Zhuhai-Singapore Life
Science Park in Zhuhai, China
Entered into a Conditional Sale and Purchase agreement to acquire
60% of Rich Tree Land for S$19.6 million
Signing of a Memorandum of Understanding (“MOU”) between AARO
and Hwa Koon Engineering, a specialist contractor in the healthcare
industry, focusing on turnkey project design and building services with
expertise in radiation shielding and bunker construction to explore
collaborations in Asia
Signing of an MOU between AARO and Jisenkai Medical Corporation
Aizawa Hospital, a private general hospital based in Matsumoto in
Nagano Prefecture, Japan which operates a comprehensive cancer
centre equipped with a proton beam therapy ("Proton Therapy")
facility to explore opportunities for the establishment of Proton
Therapy services in Singapore and Southeast Asia.
2014
Signed a Joint Venture agreement with Pinlon
Hospital and 30th Street Clinic in Yangon,
Myanmar to establish the first premier liver
centre based in Pinlon Hospital to provide
treatment for liver diseases
Key Milestones
1990 - 2011
1990
The world's first heart-and-liver transplant performed
by Dato’ Dr KC Tan
1991
1992
1993
1994
1995
1997
2002
First split-liver transplant in the U.K. by Dato’ Dr KC Tan
First auxiliary liver transplant for liver failure in the U.K.
by Dato’ Dr KC Tan
First paediatric living donor liver transplant (“LDLT”) in the U.K. and
Second auxiliary liver transplant for metabolic disease in the world
by Dato’ Dr KC Tan
AALC, formerly known as Asian Centre for Liver Diseases &
Transplantation (”ACLDT”) is established by Dato’ Dr KC Tan
First paediatric LDLT in Southeast Asia by Dato’ Dr KC Tan
Second split-liver transplant in Asia by Dato’ Dr KC Tan
First successful adult LDLT in Southeast Asia by Dato’ Dr KC Tan
2004 - 2006 Performed first liver transplants for patients from Pakistan,
Sri Lanka, Myanmar, Bangladesh and the United Arab Emirates
in our centre by Dato’ Dr KC Tan
2007
First private medical centre to successfully perform the 100th LDLT
2009
Listed on the Australian Securities Exchange (“ASX”), stock code
in Asia
AJJ
2010
First healthcare company in Singapore to use remote patient
monitoring devices for the Intensive Care Unit
Established its first satellite clinic, which incorporated telemedicine
services, in Ho Chi Minh City, Vietnam.
2011
Entered into a Management Services Agreement with Parkway
Hospitals to co-manage Gleneagles Hospital’s liver diseases clinical
program.
2012
Signed Service Agreement with UPMC, a top Global Healthcare
Enterprise based in Pittsburgh, U.S.
First private medical centre to successfully perform the
200th LDLT in Asia
Signed Consultancy Agreement with iHEAL Medical Services to
practice at iHEAL Medical Centre in Kuala Lumpur, Malaysia.
2013
Established Haematopoietic Stem Cell Transplant centre which offers
treatment for other blood related diseases.
Signed Service Agreement with Vinmec International Hospital to set up a liver
clinic in Hanoi, Vietnam
Successful placement of 21,000,000 new shares to RusSing Med Holdings.
Creation of new brand corporate identity, renamed Asian American Medical
Group (“AAMG”)
KEY MILESTONES
2016
Successful placement of 57,000,000 new shares to
a group of sophisticated investors
Opening of the Pinlon Gastrointestinal & Liver
Centre (“PGLC”) in Yangon, Myanmar.
Signing of a Services Agreement between AARO
and Japan’s Jisenkai Medical Corporation Aizawa
Hospital following an earlier MOU.
Signed Collaboration Agreement with the Tunku
Laksamana Johor Cancer Foundation to jointly
assess the feasibility of setting up a cancer research
and treatment centre in Johor, Malaysia.
2015
Successful placement of 30,000,000 new shares to a group of
sophisticated investors
Set up a Radiation Oncology division, Asian American Radiation
Oncology Pte Ltd (“AARO”), led by Dr Daniel Tan Yat Harn
Entered into agreement with Rich Tree Land to provide Consultancy
Services as Project Lead Manager for proposed Zhuhai-Singapore Life
Science Park in Zhuhai, China
Entered into a Conditional Sale and Purchase agreement to acquire
60% of Rich Tree Land for S$19.6 million
Signing of a Memorandum of Understanding (“MOU”) between AARO
and Hwa Koon Engineering, a specialist contractor in the healthcare
industry, focusing on turnkey project design and building services with
expertise in radiation shielding and bunker construction to explore
collaborations in Asia
Signing of an MOU between AARO and Jisenkai Medical Corporation
Aizawa Hospital, a private general hospital based in Matsumoto in
Nagano Prefecture, Japan which operates a comprehensive cancer
centre equipped with a proton beam therapy ("Proton Therapy")
facility to explore opportunities for the establishment of Proton
Therapy services in Singapore and Southeast Asia.
2014
Signed a Joint Venture agreement with Pinlon
Hospital and 30th Street Clinic in Yangon,
Myanmar to establish the first premier liver
centre based in Pinlon Hospital to provide
treatment for liver diseases
AAMG annual report 2016 | page 09
chairman’s
message
Dear Shareholders,
On behalf of the Board of
Directors (“the Board”) of
Asian American Medical Group
(“AAMG” or “the Group”), I am
pleased to present to you our
annual report for the financial
year ended 31 August 2016
(“FY2016”).
remains
BUSINESS REVIEW
Singapore
leading medical destination
in Southeast Asia for high-quality care and complex
treatments. Still, staying ahead of the competition has
become increasingly challenging for healthcare providers in
Singapore for several reasons.
the
One, there has been a general slowdown in foreign patient
traffic to Singapore. This is partly due to the weakening of
currencies such as the Malaysian ringgit and the Indonesian
rupiah against the Singapore dollar. The relative strength of
the Singapore dollar has meant higher prices for patients
from neighbouring countries in need of treatment here, and
has even deterred some of them from coming to Singapore.
Two, countries in the region have made notable progress in
medical care. Our neighbours have invested substantially in
improving their healthcare infrastructure, delivery standards
and expertise. The tourism authorities in Thailand, Malaysia
and India are also actively promoting their own countries as
medical tourism hubs.
Amid these challenges, Singapore-based AAMG has stepped
up efforts to offer greater value to patients and expand into
other geographical markets. For our liver segment, we have
officially established a footing in Myanmar with the opening
of Pinlon Gastrointestinal & Liver Centre (“PGLC”) and in
Southern Peninsular Malaysia, we are looking to set up a
liver clinic at Gleneagles Medini Hospital in Johor by the first
half of 2017. I will elaborate on these later.
As announced last year, we introduced a radiation oncology
practice, run by AARO, under the leadership of Dr Daniel
Tan. In July 2016, AARO signed an agreement with Jinsenkai
Medical Corporation Aizawa Hospital to provide proton
therapy services in Japan. In Singapore, we intend to scale
up AARO by growing our local clinical practice and building
a bigger team, which can also assist with our projects
overseas.
FINANCIAL PERFORMANCE
Against the backdrop of a more competitive operating
environment, our turnover in FY2016 fell 16.1% to S$17.1
million from S$20.4 million the previous year. This was
mainly due to a decline of S$3.9 million in revenue from
AALC, our biggest revenue driver.
AALC successfully carried out 13 Living Donor Liver
Transplants (“LDLTs”) in FY2016, compared to 11 in the
previous year. Despite the increase, AALC saw a decline in
other activities in FY2016.
There was a decline of $0.7 million in revenue from our
management and consultancy business following the
termination of our project lead contract in Zhuhai, China.
These declines were partially offset by a S$1.1 million revenue
increase in our radiation oncology business.
Dato’ Dr Kai Chah Tan
Executive Chairman
Our diversification into radiation oncology has started to
yield results. AARO made a profit of S$4,000 in its first full
year of operation on the back of a turnover of S$1.1 million.
We expect AARO to remain profitable. For FY2016, we
incurred a net loss of S$2.1 million, compared to a net profit
of S$0.6 million for the previous financial year.
TAKING STOCK
While we are clear on our strategic objectives and how
to go about achieving them, we are also mindful that the
initiatives we have put in place will take time to bear fruit.
We are fortunate enough to have a sound balance sheet,
which enables us to execute our plans.
We successfully raised A$5.7 million in FY2016 through a
placement of 57 million new shares. The exercise was meant
to partly fund the acquisition of a 60% stake in Rich Tree
Land Pte Ltd, a special purpose vehicle created to build the
Zhuhai-Singapore Life Sciences Park. However after careful
deliberation, we decided to terminate the acquisition. We
will use the placement proceeds for our other growth
initiatives.
REGIONAL EXPANSION
We have been actively expanding outside Singapore in the
last few years, leveraging on our longstanding partnership
with the University of Pittsburgh Medical Centre (“UPMC”).
UPMC is a pioneer in the field of solid organ transplantation
and ranks No. 12 on the U.S. News & World Report Honor
Roll of American’s Best Hospitals.
Our idea for a dedicated centre to tackle the rising incidence
of liver disease in Myanmar had been a long time in the making,
but only became possible after international sanctions were
lifted. We seized the opportunity and officially opened the
country’s first dedicated gastrointestinal and liver centre
PGLC, on 6 March 2016 in collaboration with Pinlon Hospital
and Yangon’s famous 30th Street Clinic.
Our vision for PGLC is that it will become Myanmar’s
premium liver and gastrointestinal centre, much like AALC
in Southeast Asia. According to a 2015 survey by healthcare
officials, an alarming 3.3 million people in Myanmar suffer
from Hepatitis B, while another 1.3 million are affected by
Hepatitis C. These conditions are the most common local
causes of liver cirrhosis and cancer.
PGLC has also introduced monthly sessions for patient
consultation. Led by Professor Khin Maung Win – one of
Myanmar’s top hepatologists and academics – the centre
offers treatments, endoscopies and specialised surgical
procedures for adult and paediatric patients.
AARO has an ongoing contractual agreement with Pinlon
Hospital to provide clinical and management services to
the Pinlon Cancer Centre (“PCC”), as well as exchange
best practices. Through this agreement, which renews on
a yearly basis, we will develop PCC into a modern cancer
centre. AARO will provide PCC with clinical training and
supervision, and share its expertise in oncology operations
and care.
AARO has been engaged by Russian healthcare group
RussingMed to provide management, consultancy and
clinical support services to its subsidiary Medscan. AARO
will focus on comprehensive cancer care development,
radiotherapy and chemotherapy treatments to help
Medscan set up a cancer centre for patients in Moscow.
With this collaboration, Medscan also intends to expand
throughout the Russian Federation.
In Malaysia, we are in the final stages of expanding a liver
clinic in Gleneagles Medini Hospital, Johor Bahru. Similar to
our arrangement at iHEAL Medical Centre, located in Kuala
Lumpur, I will personally provide monthly consultations to
patients seeking liver treatments and surgical procedures.
However, unlike iHEAL Medical Centre, more surgical
procedures can be carried out at Gleneagles Medini
CHAIRMAN’S MESSAGE
Hospital because of its proximity to Singapore. In addition,
Gleneagles Medini Hospital will also capture Indonesian
patients with liver problems from Sumatra and the Riau
Islands, which are a short ferry ride away with no exit tax.
By ramping up our activities in Malaysia, we hope to
recapture local patients as well as incoming patients
from Indonesia and the wider Southeast Asia region. This
local presence will help us strengthen our foothold in the
Malaysian market, where we have established collaborations
with organisations such as the Tunku Laksamana Johor
Cancer Foundation.
COLLABORATION WITH THE TUNKU LAKSAMANA
JOHOR CANCER FOUNDATION (“TLJCF”)
We have a partnership with the Tunku Laksamana Johor
Cancer Foundation (“TLJCF”) to explore the feasibility of
setting up the region’s first integrated oncology centre, to
be located in Johor, southern Malaysia. TLJCF was officially
launched on 6 August 2016 by His Royal Highness Sultan
Ibrahim Sultan Iskandar of Johor.
TLJCF was established in June 2015 by the late Prince
of Johor, His Highness Tunku Abdul Jalil, after he was
diagnosed with liver cancer. It aims to provide relief and
care to cancer patients and their families as well as promote
research and awareness, counselling and related activities.
According to official estimates, about 100,000 Malaysians
suffer from cancer each year and an estimated one in four
will suffer from cancer by the age of 75. Beyond clinical
treatments such as chemotherapy and radiotherapy, the
centre aims to be the region’s first to offer integrated
oncology support to provide holistic care for the cancer
patient’s body, mind and soul. There will also be a centre
for wellness and cancer prevention, targeted at cancer
survivors.
We are currently working closely with TLJCF and UPMC
to conduct the feasibility studies for this exciting and
meaningful project before we can progress to the next
stage.
TEAM UPDATES
Mr Kong Meng Ang was appointed as Non-Executive
Director of AAMG on 22 February 2016. He has 40 years’
experience in finance and accounting, and is the founder
and partner at Ang & Co., an independent accounting and
business advisory firm established in 1980.
We would also like to extend our gratitude to Mr Wing Kwan
Teh who stepped down as a Non-Executive Director on 11
January 2016.
On behalf of the Board, I would also like to convey my
appreciation to all shareholders for your loyalty and support,
and to AAMG’s management team and staff for the hard
work.
Dato’ Dr Kai Chah Tan
Executive Chairman
AAMG annual report 2016 | page 11
PROFILE OF
BOARD OF DIRECTORS
>>
Dato’ Dr Kai Chah Tan
Executive Chairman
D.P.M.P., MBBS (MAL), FRCS (EDIN), FAMS
<<
Mr Evgeny Tugolukov
Non-Executive Director
B Econ
Dato’ Dr Kai Chah Tan serves as the Executive Chairman of AAMG. He is also the Executive Chairman
of Asian American Liver Centre Pte Ltd (“AALC”) and the Director of Asian American Medical Group Inc.
(“AAMG Inc”), Asian American Radiation Oncology Pte Ltd (“AARO”) Asian American Medical Group
Pte Ltd (“AAMG PL”) and Million Health Ventures Pte Ltd (“MHV”), all of which are subsidiaries of
AAMG. Dr Tan is the Lead Surgeon (Hepatobiliary/Transplant) of AALC.
Dr Tan graduated from the University of Malaya in 1978 and obtained his Surgical Fellowship from the
Royal College of Surgeons, Edinburgh in 1982. From 1984 to 1987, he obtained advanced training in
paediatric surgery in Manchester and Southampton, U.K. and further training in paediatric hepatobiliary
surgery and liver transplant surgery at King’s College Hospital (“KCH”), London. Dr Tan was Consultant
Liver Surgeon at KCH and taught surgery at the University of London from 1988 to 1994.
Pioneering various liver transplant procedures in the U.K. for both adults and paediatric patients - from
the first ‘split-liver’ transplant and the first auxiliary liver graft to five liver-kidney and one heart-liver
transplants - Dr Tan has received many accolades from his peers, patients and their families alike.
With more than 400 liver transplant procedures in the U.K. under his belt, Dr Tan set up his practice, the
Asian Centre for Liver Diseases & Transplantation (“ACLDT”), in Gleneagles Hospital, Singapore in 1994.
Dr Tan was also appointed the Director of the Liver Transplant Programme, National University Hospital
(“NUH”), Singapore from 1995 to 2002.
In April 2002, the first successful adult-adult LDLT in Southeast Asia was performed in Gleneagles
Hospital, Singapore. Dr Tan and his team have successfully performed more than 200 LDLTs - the
only private centre in Southeast Asia to reach this historical milestone. He has published extensively,
including co-editing a textbook on ‘The Practice of Liver Transplantation’, and lectured on the subjects
of hepatobiliary and liver transplantation surgery.
••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••
Mr Evgeny Tugolukov holds a degree in Economics and Enterprise Management from the Ural State
Technical University (“USTU”) in Russia. He is the President and Founder of RusSing Holdings Pte Ltd
(“RusSing”) which was founded to create more links between Russia and Singapore/Southeast Asia to
create new business visions and ideas and as well as strengthen cultural interstate communications.
Mr Tugolukov has over 20 years’ worth of rich entrepreneurial background in various business fields.
Under his management, several sizeable holdings were created, including one of Russia’s largest power
machine-building companies, PJSC EMAlliance. He is currently involved in industries such as agriculture,
natural resources, healthcare and real estate development. Having established a successful track record
in the business field, Mr Tugolukov became and is currently an Honorary Business Representative of
International Enterprise Singapore in Russia and Ukraine.
Mr Tugolukov was appointed as Non-Executive Director of AAMG on 3 June 2013 and is also a member
of the Nomination and Remuneration Committee.
page 12 | AAMG annual report 2016
PROFILE OF
BOARD OF DIRECTORS
<<
Mr Kong Meng Ang
Non-Executive Director
FCA (S’pore), FCCA (UK)
>>
Mr Heng Boo Fong
Independent Non-Executive Director
B Acc (Hons)
Mr Kong Meng Ang is the founder and Partner at Ang & Co., an independent accounting and business
advisory firm established in 1980, and has 40 years of experience in finance and accounting.
Mr Ang graduated from the National University of Singapore with a Bachelor of Accountancy in 1976. Mr
Ang is a fellow and practising member of the Institute of Singapore Chartered Accountants (“ISCA”) and
a fellow member of the Association of Chartered Certified Accountants (United Kingdom) (“ACCA”).
Mr Ang is also an accredited tax advisor (Income Tax, GST) from the Singapore Institute of Accredited
Tax Professionals.
Mr Ang Kong Meng was appointed as Non-Executive Director of AAMG on 22 February 2016.
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Mr Heng Boo Fong is an Independent Non-Executive Director and is also the Chairman of the Audit
Committee and Nomination and Remuneration Committee of AAMG.
Mr Fong studied at the University of Singapore (now known as National University of Singapore, “NUS”)
and graduated with an Honours Degree in Accountancy. He has over 42 years of working experience in
auditing, finance, business development and corporate governance.
He was with the Auditor-General’s Office, Singapore, from 1975 to 1993. He held the appointment
of Assistant Auditor-General when he left the Auditor-General’s Office. He was also General Manager
(Corporate Development) of a listed company in Singapore as well as the Chief Financial Officer
of a listed company in Australia. His other professional experience includes membership of Audit
Committees of Statutory Boards and Advisory Committees of the School of Accountancy of Nanyang
Technological University, Singapore and Ngee Ann Polytechnic, Singapore. Mr Fong was a Fellow
Member of the Institute of Singapore Chartered Accountants. He was a council member of the then
Institute of Certified Public Accountants of Singapore (“ICPAS”) (now known as Institute of Singapore
Chartered Accountants (“ISCA”)) and was awarded a silver medal by ICPAS in 1999.
Mr Fong is also presently an Independent Director of three companies listed on the SGX-ST, which
are Colex Holdings Limited, CapitaRetail China Trust Management Limited and Sapphire Corporation
Limited.
AAMG annual report 2016 | page 13
PROFILE OF
BOARD OF
DIRECTORS
>
Mr Paul Vui Yung Lee
Independent
Non-Executive Director
B Bus (MIS)
>>
Ms Jeslyn Jacques
Wee Kian Leong
Independent
Non-Executive Director
FCCA (UK)
Mr Paul Lee has over 20 years’ experience in business development, quality control and cost
management. He has been serving on a few boards of companies in Malaysia and Australia. He has
broad experience in diverse industries and international businesses such as public utilities infrastructure
construction, building materials, property development, and oil palm plantations. With a Business
Degree from Edith Cowan University in Perth and strong analytical skills, he has aided companies in
identifying and implementing strategic growth opportunities.
Mr Lee was appointed to the Board on 31 January 2013. He is a member of the Nomination and
Remuneration Committee and Audit Committee.
••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••
Ms Jeslyn Leong is a Fellow of the Association of Chartered Certified Accountants (United Kingdom)
with 25 years of extensive experience in the field of corporate finance, which included tenure as a
Financial Accountant of Teys Australia Pty Ltd, Australia’s leading beef processor and exporter.
Ms Leong joined AAMG as an Independent Non-Executive Director on 1 January 2012. She is currently
an Accountant with Orrcon Steel, a wholly-owned subsidiary of BlueScope Steel Limited (listed in
Australian Securities Exchange, “ASX”), a leading Australian distributor and manufacturer of steel, tube
and pipe. In this role, she obtained extensive experience in manufacturing management.
She is also presently an Independent Director of Six Senses. Six Senses Mountain Resort has been listed
as one of the top 10 iconic Australian holiday homes.
page 14 | AAMG annual report 2016
PROFILE OF DOCTORS
AND KEY MANAGEMENT
<<
Dr Kang Hoe Lee
Respiratory Physician & Intensivist
(Critical Care & Liver Transplant)
MA (UK), MBBChir (UK), MRCP (UK),
FRCP (EDIN), FAMS (SIN), EDIC (EUR)
>>
Dr Daniel Yat Harn Tan
Radiation Oncologist & Medical Director
(Stereotactic Radiosurgery (SRS/SBRT), Brain
and Spine, Breast and Prostate Cancers
MBBS (SIN), FRCR (Clinical Oncology, UK),
FAMS (Radiation Oncology)
Dr Lee Kang Hoe graduated from University of Cambridge, U.K. He was a scholar at Jesus College, Cambridge and a
recipient of the Duckworth Prize. He also received support from Kuok Foundation, Malaysia for his medical studies. Dr Lee
interned with Professor Sir Roy Calne at Addenbrooke’s Hospital and finished his general medicine training at Cambridge
before coming to Singapore. In 1990, he joined the Department of Medicine at the National University Hospital (“NUH”),
Singapore. Dr Lee completed his Fellowship in Critical Care Medicine at the UPMC in U.S. from 1993 to 1995, and was
awarded Fellow of the Year in 1994. From 1994 to 1995, Dr Lee performed research with Professor Michael Pinsky at UPMC
on acute lung injury.
On his return to Singapore, Dr Lee joined the National University of Singapore (“NUS”) as a Lecturer in Medicine and was
promoted to Associate Professor. He was also the Medical Director of the ICU at NUH, where he started the liver dialysis
programme in 2000.
Dr Lee was with NUS until 2005 when he joined Gleneagles Hospital, Singapore as Director of the ICU. Since then, he has
been working together with the ACLDT, now known as AALC. Dr Lee has expanded the liver dialysis programme to include
other devices, and also helped set up the dedicated liver ICU where he has been active in the management of liver failure
and liver transplant patients.
Dr Lee was one of the founding members of the Society of Intensive Care Medicine and was also a previous member of the
Specialist Training Committee for Intensive Care Medicine and Respiratory Medicine.
He has published extensively in the areas of critical care and liver transplant, and has also been involved in various research
protocols together with scientists at NUS and A*STAR in Singapore.
••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••
Dr Daniel Tan Yat Harn is the consultant radiation oncologist and medical director of Asian American Radiation Oncology
(“AARO”). He also helms the clinical unit of AARO, which provides sub-specialty radiation oncology and clinical expertise
in advanced radiation techniques to local and regional patients.
After graduating from the NUS in 2002, Dr Daniel Tan was awarded a Health Manpower Development (“HMDP”) fellowship
by Ministry of Health (“MOH”) Singapore in 2008. He then went on to obtain another fellowship in 2011 at the Royal College
of Radiologists, U.K. and subsequently was awarded another HMDP Award for training in Brachytherapy, Stereotactic
Radiosurgery and Body Irradiation (“SRS/SBRT”) by MOH Singapore in 2012. He was admitted as a Fellow of the Academy
of Medicine, Singapore (“FAMS”), Chapter of Radiation Oncology in 2012.
Dr Daniel Tan’s research interest involves the study of the use and evaluation of stereotactic radiosurgery (“SRS”) and
stereotactic body radiation therapy (“SBRT”) in benign and malignant tumours of the brain and spine. Together with his
mentors, he developed the Novalis Brain Stereotactic Radiosurgery Program at the National Cancer Centre Singapore
(“NCCS”) and subsequently developed the Novalis Spine Stereotactic Radiosurgery Program after returning from abroad.
He was the national project coordinator for the International Atomic Energy Agency’s (“IAEA”) project involving efforts
to train and develop SBRT, an advanced radiation technique, in countries within the Asia-Pacific Region. He was Course
Director for the first regional training course in SBRT in 2012, and in 2014, he was invited to IAEA as an expert consultant in
preparation for the second phase of this regional project.
Dr Daniel Tan’s work has been presented at major international conferences, and speaks frequently on his research subjects
in regional meetings. He has written and published in research journals on the subjects of neuro-oncology, SRS and SBRT.
Dr Daniel Tan was the Co-Chairperson of the Neuro-Oncology Cancer Service Line Development workgroup in NCCS and
Clinical Lecturer at the Yong Loo Lin School of Medicine at NUS. He serves as an executive committee member of the
Singapore Radiological Society and as a council member of the College of Radiology Singapore, and was the organizing
chairman of their 24th Annual Scientific Meeting and the event RadiologyAsia 2015. He is currently pursuing his MBA in
Healthcare Management at NUS because he believes that good medicine depends on good management.
AAMG annual report 2016 | page 15
PROFILE OF DOCTORS
AND KEY MANAGEMENT
>
Mr Cherinjit Shori
Group Chief Operating Officer
B Acc, PGDip Marketing & Healthcare
>>
Mr Meng Yau Yeoh
Group Chief Financial Officer
FCA (S’pore), FCCA (UK), CA (M’sia)
>>>
Angela Choong
Chief Commercial Officer
CA (S’pore), FCMA (UK)
Mr Cherinjit Shori has held the position of Group Chief Operating Officer at the Asian American Medical Group (AAMG)
since 2009. He is responsible for the company’s marketing, business development and operations.
Prior to joining AAMG, Mr. Shori was the Group Vice President/Deputy Chief Marketing Officer for Parkway Pantai where
he served for 10 years in strategic marketing, business development and regional expansion to increase the market share
for its group of hospitals in Singapore.
In total, Mr Shori has more than 20 years’ experience in the healthcare and hospitality industries covering business
development and marketing in various companies, including Sun Cruises and Sembawang Leisure (a subsidiary of
Sembawang Corporation).
He holds a Bachelor of Accountancy degree from Nanyang Technological University in Singapore as well as a Graduate
Diploma in Marketing from the Singapore Institute of Management and a Certificate in Healthcare Management from
Georgetown University, U.S.
Mr Shori has also been invited to speak at international conferences such as Internationale Tourismus-Börse Berlin (ITB
Berlin) Conference, where he shared his experience in the future of global medical tourism.
•••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••
Mr Meng Yau Yeoh obtained his professional accounting qualification from the Association of Chartered Certified
Accountants (United Kingdom) (“ACCA”) in 1994 and has over 20 years of working experience in auditing, finance and
business development.
He started his career at the then KPMG Peat Marwick in 1995 and left as an Audit Senior in 1998. After spending four years
in the Big 4 audit firm, Mr Yeoh spent the decade spanning 1999 to 2009 working in senior positions in several listed and
privately owned companies involved in a wide range of industries ranging from property development, construction,
information technology and investment holdings to service and hospitality in Singapore, Malaysia and Australia. During
that period, he was involved in two successful main board Initial Public Offerings in Singapore, as well as listing exercises
and trade sales in Germany and U.K.
Mr Yeoh is a Fellow Member of the Institute of Singapore Chartered Accountants (“ISCA”), Fellow Member of the ACCA
and a Chartered Accountant registered with the Malaysian Institute of Accountants (“MIA”). He joined AAMG as Group
Financial Controller in December 2009 and was subsequently appointed as Group Chief Financial Officer in March 2013.
•••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••
Ms Angela Choong joined AAMG as Chief Commercial Officer in August 2015 to head the newly established Commercial
Division, with her key responsibilities being project management and commercial.
Prior to joining AAMG, Ms Choong held the positions of finance director and regional financial controller with a European
MNC in manufacturing. She has over 25 years of regional business partnering experience with a strong track record of
finance, risk management, management of new factory construction projects, and implementation of business improvement
projects across China, Taiwan, Hong Kong and Southeast Asia.
Ms Choong holds a professional accounting qualification from Chartered Institute of Management Accountants in the U.K.
(“CIMA”). She is a fellow member of ISCA (Singapore) and fellow member of CIMA.
page 16 | AAMG annual report 2016
Financial review
Year ended 31 August
Revenue
Other income
Direct costs and operating expenses
(Loss)/Profit from continuing operations
Taxation
(Loss)/Profit from continuing operations, net of tax
Loss from discontinued operations, net of tax
(Loss)/Profit after taxation
(Loss)/Profit attributable to:
Members of the parent entity
Non-controlling interest
Total share capital and reserves
Basic (loss)/earnings per share
-
-
Continuing operations
Discontinued operations
Net asset value per share
Net tangible asset value per share
n.m – not meaningful
2015
Changes
%
(16.1)
66.0
0.4
n.m
n.m
n.m
n.m
n.m
n.m
n.m
n.m
42.9
2016
S$’000
17,083
S$’000
20,354
171
103
(19,465)
(19,394)
(2,211)
150
(2,061)
-
(2,061)
(2,062)
1
(2,061)
12,111
2016
1,063
(13)
1,050
(491)
559
598
(39)
559
8,476
2015
S Cents
S Cents
(0.74)
-
4.07
3.98
0.49
(0.22)
3.55
3.43
In the financial year under review, the Group faced greater challenges such as rising costs and greater regional competition
for Singapore’s healthcare providers. The Group made notable progress in diversifying its medical offerings and continuing
its geographic expansion.
The Group recorded a decline of 3.7% in overall patient transactions from 8,206 in FY2015 to 7,906 in this financial year. The
Group’s total revenue declined 16.1% or S$3.3 million to S$17.1 million in FY2016 from S$20.4 million a year earlier. Net Loss
for the Group was S$2.1 million for FY2016, reversing a Net Profit of S$0.6 million in the previous year.
Liver segment
Patient transactions for the liver segment decreased by 5.5% from 8,185 in FY2015 to 7,733 in FY2016. Operating under
the Group’s wholly-owned subsidiary AALC, the Group’s liver treatment and transplantation segment remains the largest
revenue contributor, with 91.6% (2015: 95.8%) of the Group’s overall revenue. Turnover for AALC decreased 19.8% or S$3.9
million to S$15.6 million from S$19.5 million in the previous year.
The decrease in patient and surgical activities in the year led to lower third-party revenue, sales of medication and
professional consultation fees. Compared to FY2015, third-party revenue, predominantly back-to-back billings from in-
patient cases, decreased by 21.9% or S$1.2 million. Sales of medication and professional consultation fees decreased by
28.1% and 31.3% respectively. There was a decline in the number of liver dialyses of 65.0% as there were less acute liver
failure patients who required liver dialysis before their transplant during the year. This resulted in a drop of S$1.0 million in
dialysis revenue. In this financial year, AALC performed 13 successful LDLTs, two more cases than the previous year.
Direct costs decreased 15.9%, or S$1.8 million, from S$11.5 million in FY2015 to S$9.7 million in FY2016, in line with the
decrease in revenue. Gross profit margin consequently fell to 38.4% from 42.3% the previous year. Other operating expenses,
which were predominantly non-variable, decreased marginally by S$0.2 million. As a result, the liver segment recorded a
Net Loss After Tax (“Net Loss”) of S$0.9 million for FY2016 after recording deferred tax benefit of S$150,000, reversing a
Net Profit After Tax (“Net Profit”) of S$1.3 million in the previous year.
AAMG annual report 2016 | page 17
Radiation Oncology segment
Operating under the Group’s subsidiary AARO, the radiation oncology segment recorded its first full year revenue of S$1.1
million, up from S$42,000 in the five months of FY2015. 80.9% of total AARO revenue is generated from the provision of
clinical services to its patients, with the remaining revenue from overseas project management and consultancy services
rendered. The number of patient transactions for the year under review was 173 compared to 21 in the previous year when
it received its clinic licence in July 2015.
Direct and other operating expenses was S$1.1 million, with S$0.7 million being direct cost of sales and S$0.3 million being
personnel related expenses. As a result, AARO managed to break even with a Net Profit of S$4,000 in its first full year of
operations.
Management and Consultancy segment
After careful deliberation and on the advice of the Board of Directors, AAMG decided to terminate the conditional agreement
to acquire 60% of Rich Tree Land (“RTL”), the company developing a medical centre in Zhuhai, China. The project lead
management contract was terminated concurrently.
As a result of the discontinuation of the Zhuhai project, AAMG’s Management and Consultancy segment saw a decrease
in activities in the last quarter of FY2016, resulting in a 54.1% decrease in revenue from S$0.8 million in FY2015 to S$0.4
million this year.
Total direct and other operating expenses increased by S$0.5 million to S$1.1 million in FY2016 from S$0.6 million in FY2015.
This is after making a prudent provision for doubtful debts of S$0.2 million relating to a disputed receivable amount from
RTL and professional fees for work relating to the Zhuhai project of S$0.1 million. The Group will continue to invest in
strengthening the capabilities of this segment, in anticipation of more overseas projects in the near future. The Net Loss for
this segment was S$0.7 million in the current year compared to a Net Profit of S$0.3 million in FY2015.
REVENUE
EBITDA AND PROFIT/(LOSS) AFTER TAX
25000
20000
15000
10000
5000
0
Revenue
(S$'000)
2012
2013
2014
2015
2016
3500
3000
2500
2000
1500
1000
500
0
-500
-1000
-1500
-2000
-2500
2012
2013
2014
2015
2016
EBITDA (S$'000)
(Loss)/profit (S$'000)
SHARE CAPITAL AND RESERVES
EPS AND NAV
15000
12000
9000
6000
3000
0
2012
2013
2014
2015
2016
Share capital and reserves (S$'000)
page 18 | AAMG annual report 2016
5
4
3
2
1
0
-1
-2
2012
2013
2014
2015
2016
Net asset value
per share (S cents)
Basic (Loss)/Earnings
per share (S cents)
FINANCIAL REVIEW cont’d
Review of Financial Position
Net assets for the Group increased by S$3.6 million to S$12.1 million, due mainly to net proceeds from the issue of 57,000,000
new placement shares to a group of sophisticated investors during the year, offset by the Net Loss for the year of S$2.1
million.
As a result, Net Asset Value per share increased by S 0.5 cents to S 4.1 cents from S 3.6 cents last year.
Significant changes during the year under review were:
a)
Increase in cash and cash equivalents by S$5.1 million to S$11.3 million due mainly to net proceeds from the placement
of new shares during the year;
b)
Lower trade and other receivables, which decreased by S$3.7 million to S$4.6 million as a result of lower revenues
and improved collection for patients from the United Arab Emirates (“UAE”) which are on credit terms ranging
between 60-120 days. In addition, there was a S$0.2 million provision for doubtful debts made in relation to the
amount owing by RTL;
c)
Trade and other payables decreased correspondingly by S$2.2 million to S$4.5 million, due mainly to lower purchases
of materials and consumables in line with lower revenue; and
d)
Increase in the share capital as a result of net proceeds received from the issue of 57,000,000 new placement shares
and 1,299,000 issued from the exercise of employee share options.
P
H
I
L
L
I
V
I
E
T
N
A
M
P
I
N
E
S
I
N
D
I
A
N
1
.
9
%
3
.
1
%
2
.
5
%
M
O
N
G
O
L
I
A
N
M
A
L
A
Y
SIA
3
.
8
%
N 5.4
%
SINGAPOREAN
7.0% FY2016
OTHERS
8.3%
UAE 59.0%
R
U
S
S
I
A
N
V
I
E
T
N
A
M
B
U
R
M
E
S
E
1
.
7
%
1
.
6
%
1
.
9
%
S
I
N
G
A
P
O
M
R
O
E
N
A
G
O
N
I
N
D
I
A
N
1
.
1
%
S
R
I
L
A
N
K
A
0
3
%
.
L
I
2
.
A
4
N
%
4
.1
%
O
T
H
E
R
S 5.9
%
MALAYSIAN 9.7%
FY2015
INDONESIAN
9.0%
INDONESIAN
15.2%
UAE 56.0%
Patient nationality mix for liver segment
Patients from the UAE accounted for a third of all patients in FY2016, compared to roughly a quarter of all patients in
FY2015. The revenue contribution from UAE patients made up an even higher proportion and continues to be significant in
FY2016, contributing 59.0% of AALC’s overall revenue, a marginal increase from 56.0% last financial year. This is due to the
fact that UAE patients made up the majority of AALC’s transplant cases, with ten out of the 13 cases being UAE patients.
Patients from Indonesia, Singapore and Malaysia continue to form the balance of the majority of our liver segment’s core
patients, with a combined total of 46.0%.
V
I
E
T
N
A
M
E
S
E
7
.
3
%
MALAYSIAN
13.3%
SINGAPOREAN
35.8%
FY2016
INDONESIAN
13.9%
OTHERS
29.7%
Patient nationality mix for radiation oncology segment
Most of AARO’s patients are currently local Singaporeans. They
made up 35.8% of the total patient transactions for the financial
year and contributed 44.7% of the total clinical revenue. Patients
from Indonesia and Malaysia made up a quarter of AARO’s other
patient nationalities.
AAMG annual report 2016 | page 19
patient’s
testimonials
Liver
– A daughter’s love
In 2010, my mother, Najwa Qarni Bayoomi, was diagnosed with liver cirrhosis. She
visited the doctors regularly and took medication to slow the progression of the
disease. The doctors advised that it would someday progress to a point where she
would need a liver transplant. A few years later, my mother’s
condition deteriorated. She began suffering from the accumulation
of 7 to 10 kilograms of ascitic fluid in her abdomen. She was tired
just from walking around, and it was difficult for her to do simple
housework. She also experienced headaches and other symptoms, which intensified over time.
We learnt about the treatment at Asian American Liver Centre (“AALC”), Singapore from our doctor in UAE,
who highly recommended that my mother undergo the liver transplant with Dr KC Tan. I read about Dr Tan
online and was amazed. Reading about this internationally-renowned, highly experienced doctor gave me
confidence in his skills, treatment methods and the way he deals with his patients.
My mother was initially hesitant to undergo the operation as she refused to receive a partial liver graft from one
of her children. She is not the kind to make snap decisions. However, she slowly opened up to the idea of a liver
transplant after our doctor in UAE introduced her to fellow patients and donors who had undergone successful
operations.
As her daughter, I wanted to be her donor. My mother suffered bringing up all her children, having gone through
13 pregnancies for me and my 12 siblings. Naturally, we are all very indebted to her. To prepare for the operation,
I started to exercise, lose some fat and get in shape.
The medical team and administrators at AALC were very helpful and welcoming, and had an excellent attitude.
They arranged the operation in February 2016, which was faster than I expected. A separate team took care of
everything before and after the transplant, which only left us with the paperwork. This, especially with the steps
taken to ensure our human rights were protected, made us feel safe and well cared for. Frankly, I was scared
when they explained the many potential side effects of the operation.
Fortunately, everything went smoothly and my mother and I experienced minimal side effects. We didn’t expect
her to be discharged 20 days after the transplant, which is faster than most patients. Her recovery after the
operation also went well.
On the day of our discharge, I felt really good. There was
some pain, but it was minor and I was able to move
about. My mother has also been feeling a lot better and
the earlier symptoms have started to disappear. She now
feels ‘lighter’ and is able to work and move unaided. I am
now in good health, possibly even better than before,
because I feel fresher and lighter.
I am very happy that my mother is well again. Given the
chance, I would highly recommend that my fellow
patients seek treatment here.
Najwa Qarni Bayoomi (front) with children.
Fatema Saeed (donor, middle). 18 March 2016
Radiation Therapy
– A cancer survivor’s story
I came to Dr Daniel Tan for Stereotactic Body Radiation
Therapy (“SBRT”) after researching treatment options
for my liver metastases. Dr Daniel Tan was very friendly
and patient in explaining the treatment to me. It really
helped to calm my fears when I was undergoing my
treatment. I would like to thank the staff for the
assistance and care given to me.
page 20 | AAMG annual report 2016
Nguyen Van Ha
WHAT IS LIVING
DONOR LIVER
TRANSPLANTATION?
Living donor liver transplantation
(“LDLT”) is a procedure that involves a
living donor giving a portion of his or
her liver to a family member or close
friend in need of a liver transplant.
The LDLT procedure at AALC is performed
by an experienced team of liver transplant surgeons,
supported by the most up-to-date facilities and
seamless post-surgery care to ensure the best
clinical outcome for patients.
At AALC, the LDLT Journey is specially designed for
the best possible clinical outcomes. Our experienced
transplant coordinators work alongside doctors to educate
and guide patients, donors and their families through every
step of the journey.
• Optimising medical
condition for
transplant surgery
THE RADIOTHERAPY
• Preparing for
treatment: molding
of immobilization
device, CT simulation
JOURNEY
The radiotherapy process involves a
number of complex steps and a patient
may be recommended different
procedures or sequences. At AARO, our
radiation oncologist leads a clinical team
of physicists and dosimetrists in providing
the best possible treatment and aftercare
for the patient.
• Patient
evaluation
• Post
treatment
surveillance
• Post-
radiation
therapy
review
• Computer
treatment
planning*
• Weekly on-
treatment
reviews
• Daily/weekly
QA checks
• Radiation
treatment
plan quality
assurance
checks
• Commencement
of radiation
therapy
* Computer Treatment Planning includes:
- Target and normal tissue delineation
- Radiation dose and fraction prescription
- Beam placement and dose distribution optimization
- Radiation treatment plan assessment and approval
Liver
In 2010, my mother, Najwa Qarni Bayoomi, was diagnosed with liver cirrhosis. She
visited the doctors regularly and took medication to slow the progression of the
disease. The doctors advised that it would someday progress to a point where she
– A daughter’s love
would need a liver transplant. A few years later, my mother’s
condition deteriorated. She began suffering from the accumulation
of 7 to 10 kilograms of ascitic fluid in her abdomen. She was tired
just from walking around, and it was difficult for her to do simple
housework. She also experienced headaches and other symptoms, which intensified over time.
We learnt about the treatment at Asian American Liver Centre (“AALC”), Singapore from our doctor in UAE,
who highly recommended that my mother undergo the liver transplant with Dr KC Tan. I read about Dr Tan
online and was amazed. Reading about this internationally-renowned, highly experienced doctor gave me
confidence in his skills, treatment methods and the way he deals with his patients.
My mother was initially hesitant to undergo the operation as she refused to receive a partial liver graft from one
of her children. She is not the kind to make snap decisions. However, she slowly opened up to the idea of a liver
transplant after our doctor in UAE introduced her to fellow patients and donors who had undergone successful
operations.
As her daughter, I wanted to be her donor. My mother suffered bringing up all her children, having gone through
13 pregnancies for me and my 12 siblings. Naturally, we are all very indebted to her. To prepare for the operation,
I started to exercise, lose some fat and get in shape.
The medical team and administrators at AALC were very helpful and welcoming, and had an excellent attitude.
They arranged the operation in February 2016, which was faster than I expected. A separate team took care of
everything before and after the transplant, which only left us with the paperwork. This, especially with the steps
taken to ensure our human rights were protected, made us feel safe and well cared for. Frankly, I was scared
when they explained the many potential side effects of the operation.
Fortunately, everything went smoothly and my mother and I experienced minimal side effects. We didn’t expect
her to be discharged 20 days after the transplant, which is faster than most patients. Her recovery after the
operation also went well.
On the day of our discharge, I felt really good. There was
some pain, but it was minor and I was able to move
about. My mother has also been feeling a lot better and
the earlier symptoms have started to disappear. She now
feels ‘lighter’ and is able to work and move unaided. I am
now in good health, possibly even better than before,
because I feel fresher and lighter.
I am very happy that my mother is well again. Given the
chance, I would highly recommend that my fellow
patients seek treatment here.
Radiation Therapy
– A cancer survivor’s story
I came to Dr Daniel Tan for Stereotactic Body Radiation
Therapy (“SBRT”) after researching treatment options
for my liver metastases. Dr Daniel Tan was very friendly
and patient in explaining the treatment to me. It really
helped to calm my fears when I was undergoing my
treatment. I would like to thank the staff for the
assistance and care given to me.
Najwa Qarni Bayoomi (front) with children.
Fatema Saeed (donor, middle). 18 March 2016
WHAT IS LIVING
DONOR LIVER
TRANSPLANTATION?
Living donor liver transplantation
(“LDLT”) is a procedure that involves a
living donor giving a portion of his or
her liver to a family member or close
friend in need of a liver transplant.
The LDLT procedure at AALC is performed
by an experienced team of liver transplant surgeons,
supported by the most up-to-date facilities and
seamless post-surgery care to ensure the best
clinical outcome for patients.
At AALC, the LDLT Journey is specially designed for
the best possible clinical outcomes. Our experienced
transplant coordinators work alongside doctors to educate
and guide patients, donors and their families through every
step of the journey.
PATIENT’S TESTIMONIALS
• Optimising medical
condition for
transplant surgery
THE RADIOTHERAPY
JOURNEY
• Patient
evaluation
• Preparing for
treatment: molding
of immobilization
device, CT simulation
The radiotherapy process involves a
number of complex steps and a patient
may be recommended different
procedures or sequences. At AARO, our
radiation oncologist leads a clinical team
of physicists and dosimetrists in providing
the best possible treatment and aftercare
for the patient.
• Post
treatment
surveillance
• Post-
radiation
therapy
review
• Computer
treatment
planning*
• Weekly on-
treatment
reviews
• Daily/weekly
QA checks
• Radiation
treatment
plan quality
assurance
checks
• Commencement
of radiation
therapy
* Computer Treatment Planning includes:
- Target and normal tissue delineation
- Radiation dose and fraction prescription
- Beam placement and dose distribution optimization
- Radiation treatment plan assessment and approval
Nguyen Van Ha
AAMG annual report 2016 | page 21
Corporate governance statement
The Board of Asian American Medical Group Limited (“AAMG”) seeks to practise the highest ethical and commercial
standards while executing its responsibilities in directing the business and affairs of the Company on behalf of its
shareholders.
The Board of AAMG has considered the principles of good corporate governance and best practice recommendations
as published by the ASX Corporate Governance Council (“ASXCGC”). ASX Listing Rule 4.10.3 requires the Company to
disclose the extent to which it follows or diverges from these best practice recommendations in its Annual Report.
This report discloses corporate governance practices the Board would like to highlight to stakeholders.
Additional information relating to corporate governance practices that the Company has adopted can be found on the
Company’s web site: www.aamg.co.
THE ROLE OF THE BOARD & MANAGEMENT
The Company has formalised and disclosed the roles and responsibilities of the Board and those delegated to senior
management.
The Board of the Company is responsible for the overall corporate governance of the AAMG, including its ethical behavior,
strategic direction, establishing goals for management and monitoring the achievement of those goals with a view to
optimising Company performance and maximising shareholder value.
The role of management is to support the Executive Director and implement the running of the general operations and
financial business of the Company, in accordance with the delegated authority of the Board.
Full details of the matters reserved to the Board and to senior management are available on the Company’s web site at
www.aamg.co.
Scheduled meetings of the Board are held at least four times a year and the Board meets on other occasions to deal with
matters that require attention between scheduled meetings. The responsibility for the operation and administration of the
consolidated entity is delegated by the Board to the senior management.
The Board is responsible for:
• Setting the strategic direction of the Company and establishing goals to ensure these strategic objectives are met;
• Appointing the senior management, setting objectives for the senior management and reviewing performance against
those objectives, ensuring appropriate policies and procedures are in place for recruitment, training, remuneration and
succession planning;
• Monitoring financial performance including approval of the annual and half-yearly financial reports and liaison with the
Company’s auditors;
• Ensuring that risks facing the company and its controlled entities have been identified ensuring that appropriate and
adequate controls, monitoring and reporting mechanisms are in place;
• Receiving detailed briefings from senior management on a regular basis during the year;
• Approving the Boards of directors of subsidiary companies; and
• Ensuring the Company complies with the law and conforms to the highest standards of financial and ethical behavior.
AAMG has obligations to its stakeholders to ensure the Company is managed with appropriate due diligence and that all
necessary processes are implemented to minimise risk and maximise business opportunities.
To this end, all commercial arrangements, capital expenditure, operational expenditure and other commitments are
appropriately documented and have been authorised by either the Executive Director or the Board as appropriate.
The composition of the Board is determined in accordance with the Company’s constitution and the following principles
and guidelines:
• The Board should comprise of at least three directors with at least two non-executive directors;
• The Board should comprise of directors with an appropriate range of qualifications and expertise; and
• The Board should meet formally at least four times per annum and informally on an “as required” basis with all directors
being made aware of, and having available, all necessary information, to participate in an informed discussion of all
agenda items.
page 22 | AAMG annual report 2016
CORPORATE GOVERNANCE STATEMENT
DIRECTORS IN OFFICE
At the date of this statement the following directors are considered independent by the Board:
Name
Position
Independent
Mr Heng Boo Fong
Non-Executive Director
Ms Jeslyn Jacques Wee Kian Leong
Non-Executive Director
Mr Paul Vui Yung Lee
Non-Executive Director
Yes
Yes
Yes
The skills, experience, expertise and tenure of each director are disclosed in the Directors’ Report within this Annual Report.
DIRECTOR INDEPENDENCE
The Board considers three of AAMG’s directors as independent under the guidelines.
In assessing the independence of directors, the Board follows the ASX guidelines as set out:
An independent director is a non-executive director (i.e. is not a member of management) and:
• Is not a substantial shareholder of the Company or an officer of, or otherwise associated directly with, a substantial
shareholder of the Company;
• Within the last three years has not been employed in an executive capacity by the Company or another Group member,
or been a director after ceasing to hold any such employment;
• Within the last three years has not been a principal of a material professional adviser or a material consultant to the
Company or another Group member, or an employee materially associated with the service provided;
• Is not a material supplier or customer of the Company or other Group member, or an officer of or otherwise associated
directly or indirectly with a material supplier or customer;
• Has no material contractual relationship with the Company or another Group member other than as a director of the
Company;
• Has not served on the Board for a period which could, or could reasonably be perceived to, materially interfere with
the director’s ability to act in the best interests of the Company; and
• Is free from any interest and any business or other relationship which could, or could reasonably be perceived to,
materially interfere with the director’s ability to act in the best interests of the Company.
ASXCGC Recommendation 2.1 states that the majority of directors of the Company should be independent. Although
currently AAMG does not comply with that recommendation, the Board is of the opinion that the current structure and
composition of the Board is appropriate given the size and nature of operations of the Group.
Where additional skills are considered necessary for specific purposes, access is made to independent professional advice
at the expense of the Company. Such advice is to be shared amongst the directors.
CHAIRMAN
Due to the size of the Company, Dato’ Dr Kai Chah Tan is the Company’s Chairman. While recognising that the ASXCGC
recommends that the chairperson be independent, the Company feels that the strong independence exercised by the
other Board members mitigates any negative impact on the Company that it may have.
APPOINTMENT TO THE BOARD
Where a casual vacancy arises during the year, the Board has procedures to select the most suitable candidate with the
appropriate experience and expertise to ensure a balanced and effective board. Any director appointed during the year to
fill a casual vacancy or as an addition to the current board, holds office until the next Annual General Meeting and is then
eligible for re-election by the shareholders.
New directors receive a letter of appointment which sets out the terms of their appointment. On appointment, an induction
programme is available to directors that include one-on-one sessions with members of the senior management team.
AAMG annual report 2016 | page 23
EVALUATION OF SENIOR EXECUTIVES
Senior executives, including the Group Chief Operating Officer, Group Chief Financial Officer or Chief Commercial Officer
have a formal job description and letter of appointment describing their term of office, duties, rights, responsibilities and
entitlements upon termination.
The performance of senior executives is reviewed annually before the budgets are approved for the next financial year. This
process is a formal one with the executive’s performance assessed against Company, division and personal benchmarks by
the Nomination and Remuneration Committee. Benchmarks are agreed with the respective senior executives and reviews
are based upon the degree of achievement against those benchmarks.
Induction procedures are in place to allow new senior executives to participate fully and actively in management decision-
making. The induction program includes orientation of:
• The Company’s financial position, strategies, operations and risk management policies.
• The respective rights, duties, responsibilities and roles of the board and senior executives.
ETHICAL BUSINESS PRACTICES
The Company has adopted a Code of Conduct to maintain confidence in the Company’s integrity, its legal obligations and
the expectations of its stakeholders. The Company is committed to being a socially responsible corporate citizen, using
honest and fair business practices, to act in the best interests of clients so as to achieve the best outcome for shareholders.
The Board has procedures in place for reporting any matters that may give rise to unethical practices or conflicts between
the interests of a director or senior executive and those of the Company. These procedures are reviewed as required by
the Board. To this end, the Company has adopted a Conflict of Interest Policy that clarifies the processes for directors and
senior executives to determine and disclose when a conflict of interest exists.
DIVERSITY POLICY
The Company values diversity and recognises the benefits it can bring to the organisation’s ability to achieve its goals. Our
recruitment processes encourage the development of diversity in our workplace, bearing in mind that employees must
have the required skills to be successful in their positions.
In accordance with this policy and ASX Corporate Governance Principles, the Board has established the following
objectives in relation to gender diversity. We currently meet our objectives but will continue to monitor and improve on
our objectives to be in line with our Company’s needs and direction. A written diversity policy has been developed by the
Board to ensure gender diversity.
Number of women employees in the whole organisation
Number of women in senior executive positions
Number of women on the Board
SHAREHOLDING AND TRADING
Objective
Actual
Number
18
2
2
%
75
29
33
Number
19
2
1
%
76
29
17
The Board encourages directors and senior executives to own shares in the Company to further link their interests with the
interests of all shareholders. Trading of shares by directors or senior executives is prohibited under certain circumstances
and as described in the ASX Listing Rules and during certain periods of the financial year. A director or senior executive
must not deal in the Company shares at any time when he or she has unpublished information which, if generally available,
might affect the share price. Directors are required to notify the Company Secretary following dealing.
SAFEGUARD INTEGRITY
The Board has established an Audit Committee (“AC”) comprised of the three non-executive directors. This committee
operates under a charter to enable it to perform its roles and responsibilities. Where considered appropriate, the Company’s
external auditors and the Company’s management are invited to attend meetings.
The members of the AC are:
• Mr Heng Boo Fong (Chairman)
• Mr Paul Vui Yung Lee
• Ms Jeslyn Jacques Wee Kian Leong (appointed on 22 February 2016)
The qualifications of members of the committee together with their attendances at committee meetings are disclosed in
the Directors’ Report within this Annual Report.
page 24 | AAMG annual report 2016
CORPORATE GOVERNANCE STATEMENT cont’d
The role of the AC is to assist the Board fulfill its responsibilities in relation to the identification of the areas of significant
business risks and the monitoring of the following:
• Effective management of financial and other business risks;
• Reliable management reporting;
• Compliance with laws and regulations in respect to financial reporting;
• Maintenance of effective and efficient audits;
• Meeting with external auditors on a twice-yearly basis and informally as circumstances require; and
• Recommending to the Board the appointment, rotation, removal and remuneration of the external auditors, and review
their terms of engagement, and the scope and quality of the audit. Periodically, the AC reviews the appointment of the
external audit engagement partners using a formal process of evaluation to determine the most appropriate level of
skills and experience to suit the size and complexity of the Company.
The AC provides the Board with additional assurances regarding the reliability of financial information for inclusion in the
financial statements.
The committee is chaired by an independent chair who is not the chairman of the Board.
TIMELY AND BALANCED DISCLOSURE
The Board recognises the need to comply with ASX Listing Rule 3.1 concerning continuous disclosure.
At each meeting of directors, consideration is given as to whether notice of material information concerning the Company,
including its financial position, performance, ownership and governance has been made available to all investors.
The Continuous Disclosure Policy also requires senior executives in possession of disclosable information to comply with
that policy.
COMMUNICATION WITH SHAREHOLDERS
The Board aims to ensure that shareholders, on behalf of whom they act, are informed of all major developments affecting
the Company’s activities and its state of affairs, including information necessary to assess the performance of the directors.
Communication with shareholders is achieved through the distribution of the following information:
• The Annual Report distributed to shareholders;
• The Half Yearly Report which is available on the Company’s web site;
• The Annual General Meeting and other meetings called to obtain shareholder approval for Board action as appropriate.
Shareholders are encouraged to attend and participate at the Company’s Annual General Meeting and other General
Meetings;
• Letters to shareholders when considered to be appropriate and informative;
• Announcements to the Australian Securities Exchange; and
• Investor information through the Company’s internet portal at www.aamg.co.
The Company strives to ensure that Company announcements via the ASX are made in a timely manner, are factual, do not
omit material information and are expressed in a clear and objective manner.
SHAREHOLDERS’ ROLE
The shareholders of the Company are responsible for voting on the election of directors at the Annual General Meeting in
accordance with the constitution.
All directors (other than a Managing Director) are subject to re-election by rotation, no later than every three years.
The Annual General Meeting also provides shareholders with the opportunity to express their views on matters concerning
the Company and to vote on other items of business for resolution by shareholders.
RISK MANAGEMENT
The Board is responsible for overseeing the risk management function. The Company believes that it is crucial for all Board
members to be a part of the process and as such has established risk management as a component of the AC.
The Board is responsible for ensuring the risks and opportunities are identified on a timely basis.
The Board has a number of mechanisms in place to ensure the management’s objectives and activities are aligned with the
risks identified by the Committee. These include the following:
• Implementation of Board approved operating plans and budgets;
• Board monitoring of progress against these budgets, including the monitoring of key performance indicators of both
a financial and non-financial nature; and
• The establishment of committees to report on specific risk as identified.
AAMG annual report 2016 | page 25
CORPORATE GOVERNANCE STATEMENT cont’d
INTERNAL RISK MANAGEMENT SYSTEM COMPLIANCE
Management is accountable to the Board to ensure that operating efficiency, effectiveness of risk management procedures,
internal compliance control systems and controls and policies are all being monitored. Management has designed and
implemented a risk management and internal control system to manage the Company’s material business risks and reports
to the Board at each meeting on the effective management of those risks. The Company has developed a series of
operational risks which the Company believes to be inherent in the industry in which the Company operates. These include:
• Changed operating, market or regulatory environments;
• Fluctuations in demand volumes;
• Fluctuations in exchange rates; and
• Increasing costs of operations.
These risk areas are provided here to assist investors better understand the nature of the significant risks faced by the
Company.
MONITORING PERFORMANCE
The Board and senior management monitor the performance of all divisions through the preparation of monthly
management accounts. The monthly management accounts are prepared using accrual accounting techniques and report
each business unit’s result as contribution after overhead allocation. These monthly management accounts are compared
to monthly budgets, which have been set allowing for the seasonality of anticipated revenues and costs in each of the
divisions.
The monitoring of the Company’s performance by the Board and management assists in identifying the correct allocation
of resources and staff to maximise the overall return to shareholders.
A performance evaluation for senior management was undertaken during the year and was in accordance with the process
developed by the Board for that purpose.
Details of the structure of non-executive directors’ and senior executives’ remuneration are included in the Remuneration
Report within the Directors’ Report in this Annual Report.
NOMINATION AND REMUNERATION
Nomination and Remuneration Committee
The Nomination and Remuneration Committee (“NRC”) is comprised of three non-executive directors. The members of
the NRC are:
• Mr Heng Boo Fong (Chairman)
• Mr Paul Vui Yung Lee
• Mr Evgeny Tugolukov (appointed on 22 February 2016)
The qualifications of members of the committee together with their attendances at committee meetings are disclosed in
the Directors’ Report within this Annual Report.
The role of the NRC is to make decisions on the following matters:
• Determine the appropriate size and composition of the Board;
• Determine the terms and conditions of appointment to and retirement from the Board;
• Develop appropriate criteria for Board membership;
• Reviewing membership of the Board and proposing candidates for consideration by the Board;
• Arranging a review of the Board’s own performance;
• Determine the Company’s remuneration plans, policies and practices, including compensation arrangements for the
non-executive directors, executive directors, Group Chief Operating Officer, Group Chief Financial Officer, Chief
Commercial Officer and senior executives; and
• Responsible for considering general remuneration policies and practices, recruitment and termination policies and
superannuation requirements.
The Board believes that it has the right numbers and skill sets within its Board members for the current size of the
Company, and is confident that each non-executive director brings independent judgement to bear on Board decisions.
The Company does not have a policy to preclude its executives from entering into transactions to limit their economic
risk from investing in Company shares, options or rights and has made executives aware of their obligations in relation
to financial commitments against shares issued under the executive securities plan and has requested that they take
sufficient professional advice in relation to their individual financial position.
There are no retirement schemes or retirement benefits other than statutory benefits for non-executive directors.
page 26 | AAMG annual report 2016
Directors’ report
The directors present their report, together with the financial statements of the Asian American Medical Group Limited
(“the Group”) for the year ended 31 August 2016.
DIRECTORS
The directors of the Group at any time during or since the end of the financial year are as set out below.
Dato’ Dr Kai Chah Tan (Executive Chairman)
Mr Evgeny Tugolukov (Non-Executive Director)
Mr Kong Meng Ang (Non-Executive Director) (appointed on 22 January 2016)
Mr Heng Boo Fong (Independent Non-Executive Director)
Mr Paul Vui Yung Lee (Independent Non-Executive Director)
Ms Jeslyn Jacques Wee Kian Leong (Independent Non-Executive Director)
Mr Wing Kwan Teh (Non-Executive Director) (resigned 11 January 2016)
Ms Pamela Anne Jenkins (Non-Executive Director) (resigned 30 September 2015)
The skills, experience, expertise and tenure of each director are disclosed in the profile of directors section within the
Annual Report.
Below is the profile of directors who are no longer in office:
Mr Wing Kwan Teh FCA (S’pore), FCCA (UK), IA (HKCPA), CA (M’sia) (resigned 11 January 2016)
Mr Wing Kwan Teh specializes in corporate restructuring, corporate finance and merger & acquisition.
Mr Teh is currently the Managing Director and Group CEO of Sapphire Corporation Limited (“Sapphire”) (listed on the
Main Board of the Singapore Exchange Securities Limited (“SGX-ST”)) and under the new strategic direction of Mr Teh,
Sapphire has undergone a major corporate restructuring exercise and successfully acquired the second largest privately-
owned urban rail transit infrastructure group in China as part of his corporate turnaround strategies.
Mr Teh is also a Non-Executive and Non-Independent Director of Singapore eDevelopment Ltd (listed on Catalist of the
SGX-ST and previously known as CCM Group Limited), an appointed Adviser to the Board of Koda Ltd (listed on the Main
Board of SGX-ST), a sophisticated investor and a director of BMI Capital Partners Limited (Hong Kong). He was a Non-
Executive and Non-Independent Director of Heng Fai Enterprises Limited (listed on the Hong Kong Stock Exchange) and
he also served as appointed Audit Committee Chairman and Independent Director of other public companies listed on the
SGX-ST. Mr Teh has had significant experience having been a professional in finance who have been advising companies
listed in and prepared to list in Hong Kong, Singapore, Australia, Vietnam and Taiwan. Mr Teh is a nominated candidate
for the Asia Pacific Entrepreneurship Awards 2015 (Singapore) under the Industrial and Commercial Products Industry.
Mr Teh is a Fellow Chartered Accountant of Singapore, Fellow Member of the Association of Chartered Certified
Accountants (United Kingdom), an International Affiliate of the Hong Kong Institute of Certified Public Accountants, a
Chartered Accountant of the Malaysian Institute of Accountants, a Full Member of Singapore Institute of Directors and a
Member of Hong Kong Securities and Investment Institute.
Ms Pamela Anne Jenkins RGN, B Sc (Hons), MBA (resigned 30 September 2015)
Ms Pamela Anne Jenkins holds a Bachelor of Science (Honours) degree from University of East London, United Kingdom
as well as a Master of Business Administration (“MBA”) from Kingston University, United Kingdom. Ms Jenkins has wide
experience in specialised nursing and healthcare management, covering neurosurgery, cardiothoracic surgery, vascular
surgery, orthopaedic surgery, general surgery, microvascular surgery, eye surgery, plastic surgery, paediatric surgery,
urology and renal transplantation, hepatobiliary and liver transplant surgery. She has also written conference papers on
liver failure and liver transplantation, with special focus on paediatric liver diseases.
Ms Jenkins began her career in 1984 as an Operating Theatre Sister, KCH, London, and subsequently attained the position
of Clinical Nurse Specialist and Department Manager at the hospital’s Liver Transplant Surgical Service. In her latter role
she was in charge of operating theatre staff, trainee nurses, administration, management of the unit and budgetary control.
After ten years at KCH, she relocated to Singapore in 1994 to establish AALC with Dr Tan, assuming the role of director of
AALC. She was responsible for the design and development of the centre, implementation of management systems, and
assisted in hepatobiliary and liver transplantation surgery. In 1997, she assumed the position of Managing Director where
she oversaw the management and operations, budgetary control and strategic planning in liaison with the Executive
Chairman and Founder, Dato’ Dr Kai Chah Tan, a position she held until May 2015.
PRINCIPAL ACTIVITIES
The principal activity of Asian American Medical Group Limited and its controlled entities (“AAMG” or “the Group”) is
that of provision of specialised medical services for liver diseases and transplantation, radiation oncology and healthcare
project management and consultancy services. Our blood and bone marrow transplant segment, operated under Asian
American Blood & Bone Marrow Transplant Centre Pte Ltd (“AABMTC”), ceased operations on 31 December 2014. It
subsequently changed its name to Asian American Radiation Oncology Pte Ltd (“AARO”) and commenced operating a
new radiation oncology segment thereafter. AABMTC’s financial results up to the date of closure have been classified as
“Discontinued Operations”.
There has been no change in the principal activity of the Group during the financial year.
AAMG annual report 2016 | page 27
COMPANY SECRETARY
The following person held the position of company secretary at the end of the financial year:
Mr Dario Nazzari
Dario Nazzari has a Bachelor of Commerce, a Diploma in Financial Planning and has more than 19 years professional
experience. He is a Chartered Accountant and a member of the Institute of Chartered Accountants.
REVIEW AND RESULTS OF OPERATIONS
Details of the Operations of AAMG during the year, the financial position and the strategies and prospects for the future
years can be found in the Chairman’s message found on pages 10 and 11 and Financial Review section on pages 17 to 19,
which forms part of this Annual Report.
DIRECTORS’ MEETINGS
The following table sets out the number of director’s meetings (including meetings of Committees of directors) held
during the financial year and the number of meetings attended by each director (while they were a director or committee
member). During the financial year, seven (7) Board meetings, two (2) Audit Committee meetings and three (3) Nomination
and Remuneration Committee meetings were held.
Directors’ Meetings
Audit Committee
Meetings
Nomination and
Remuneration
Committee
Meetings
Number
Eligible to
attend
Number
Attended
Number
Eligible to
attend
Number
Attended
Number
Eligible to
attend
Number
Attended
7
7
3
7
7
7
3
-
7
7
3
7
6
7
3
-
-
-
-
2
2
1
-
-
-
-
-
2
2
1
-
-
-
2
-
3
3
-
-
-
-
2
-
3
3
-
-
-
Dato’ Dr Kai Chah Tan
Mr Evgeny Tugolukov
Mr Kong Meng Ang ^
Mr Heng Boo Fong
Mr Paul Vui Yung Lee
Ms Jeslyn Jacques Wee Kian Leong
Mr Wing Kwan Teh *
Ms Pamela Anne Jenkins *
^Mr Kong Meng Ang was appointed on 22 January 2016
*Mr Wing Kwan Teh and Ms Pamela Jenkins resigned on 11 January 2016 and 30 September 2015 respectively
DIRECTORS’ INTEREST
The relevant interests of each director in the shares of the parent entity at the date of this report are as follows:
Director
Dato’ Dr Kai Chah Tan
Mr Evgeny Tugolukov
Mr Kong Meng Ang
Mr Heng Boo Fong
Mr Paul Vui Yung Lee
Ms Jeslyn Jacques Wee Kian Leong
^ Indirect interest through RusSing Med Holdings Pte Ltd.
None of the directors have share options in the Company.
page 28 | AAMG annual report 2016
Number of shares
107,298,250
^ 21,000,000
34,000,000
-
-
-
DIRECTORS’ REPORT cont’d
DIVIDENDS PAID OR RECOMMENDED
No interim or final dividend has been paid or recommended by the Directors for the financial year ended 31 August 2016
(2015 : Nil).
SIGNIFICANT CHANGES IN STATE OF AFFAIRS
There were no significant changes in the state of affairs of the Group during the year.
EVENTS SUBSEQUENT TO BALANCE DATE
No other matters or circumstances have arisen since the end of the financial year which significantly affected or may
significantly affect the operations of the Group, the results of those operations, or the state of affairs of the Group in future
financial years.
LIKELY DEVELOPMENTS
Likely developments, future prospects and business strategies of the operations of the Group and the expected results of
those operations in future years are detailed in the Chairman’s message on pages 10 and 11. These are mainly in line with
the Group’s growth strategies as follows:
1. Continue with the Group’s geographical expansion plans and build on existing presence overseas such as in Malaysia,
Russia and Myanmar, in the area of specialised clinical services and project management;
2. Enhance AARO’s comprehensive suite of capabilities as a regional provider of one-stop solutions in radiology and
oncology and to leverage on these capabilities to expand;
3. Strengthen our position in our core markets for liver services; and
4. Explore investment opportunities in the region in the healthcare sector.
OPTIONS
At the date of this report, the unissued ordinary shares of AAMG under option are as follows:
Options
exercised/
Options
Exercise
outstanding
Options
cancelled/
outstanding at
Options
Grant Date
Price
at 1.9.2015
granted
lapsed
31.8.2016
Exercise period
17.1.2011
$0.088
1,299,000
-
(1,299,000)
-
17.1.2012 to 17.1.2016
Option holders do not have any rights to participate in any issues of shares or other interests in the company or any other
entity.
Except as disclosed above, there have been no unissued shares or interests under option of any controlled entity within
the Group during or since reporting date.
For details of options issued to key management personnel as remuneration, refer to the Remuneration Report.
During the financial year, 1,299,000 ordinary shares were issued as a result of the exercise of options.
ENVIRONMENTAL REGULATION
The Company’s operations are not regulated by any significant environmental regulation under a law of the Commonwealth
or of a State or Territory.
The directors are not aware of any particular or significant environmental issues which have been raised in relation to
the Company’s operations during the financial year. The directors are also not aware of any breach in the environmental
regulations in Singapore, Malaysia and Myanmar during the financial year.
AAMG annual report 2016 | page 29
REMUNERATION REPORT (Audited)
The Directors of Asian American Medical Group Limited (“AAMG” or ‘the Group’) present the Remuneration Report for
Non-Executive Directors, Executive Directors and other KMP, prepared in accordance with the Corporations Act 2001 and
the Corporations Regulations 2001.
DETAILS OF MEMBERS OF KEY MANAGEMENT PERSONNEL
The key management personnel of the Group during the financial year ended 31 August 2016 are listed below.
Directors:
Dato’ Dr Kai Chah Tan – Executive Director and Chairman
Mr Evgeny Tugolukov - Non-Executive Director
Mr Kong Meng Ang - Non-Executive Director (appointed 22 January 2016)
Mr Heng Boo Fong - Independent Non-Executive Director
Mr Paul Vui Yung Lee - Independent Non-Executive Director
Ms Jeslyn Jacques Wee Kian Leong - Independent Non-Executive Director
Mr Wing Kwan Teh - Non-Executive Director (resigned 11 January 2016)
Ms Pamela Anne Jenkins – Non-Executive Director (resigned 30 September 2015)
Other key management personnel:
Mr Cherinjit Kumar Shori – Group Chief Operating Officer
Mr Meng Yau Yeoh – Group Chief Financial Officer
Ms Angela Choong Chiew Foong – Chief Commercial Officer
The skills, experience, expertise and tenure of each director and KMP are disclosed in the profile of directors and KMP
sections respectively within the Annual Report.
The Remuneration Report is set out under the following main headings:
a. principles used to determine the nature and amount of remuneration;
b. details of remuneration;
c. service agreements;
d. share-based remuneration; and
e. other information.
A.
PRINCIPLES USED TO DETERMINE THE NATURE AND AMOUNT OF REMUNERATION
The principles of the Group’s executive strategy and supporting incentive programs and frameworks are:
• to align rewards to business outcomes that deliver value to shareholders;
• to drive a high performance culture by setting challenging objectives and rewarding high performing individuals; and
• to ensure remuneration is competitive in the relevant employment market place to support the attraction, motivation
and retention of executive talent.
AAMG has structured a remuneration framework that is market competitive and complementary to the reward strategy
of the Group.
The Board has established a Nomination and Remuneration Committee (“NRC”) which operates in accordance with its
charter as approved by the Board and is responsible for determining and reviewing compensation arrangements for the
Directors and the Executive Team.
The NRC, consisting of at least two non-executive directors, is responsible for making recommendations on remuneration
policies and packages applicable to Board members and for approval of remuneration for executive officers of the Group
taking into account the financial position of the Consolidated Group. The Board remuneration policy per the formal Charter
is to ensure the remuneration package properly reflects the person’s duties and responsibilities, and that remuneration is
competitive in attracting, retaining and motivating people of the highest quality.
The Constitution of the Company specifies that the aggregate remuneration of directors, other than salaries paid to
executive directors, shall be determined from time to time by general meeting. An amount not exceeding the amount
determined is divided between those directors as they agree. The latest determination was at the Annual General Meeting
held on 23 November 2009 when shareholders approved an aggregate remuneration pool of A$200,000 per annum.
The Board as a whole determines the amount of the fees paid to each non-executive director. The amount proposed to be
paid to each non-executive director during the year is A$15,450-A$25,750 (2015: A$15,450-A$25,750).
The remuneration structure that has been adopted by the Group consists of the following components:
* fixed remuneration being annual salary; and
• short term incentives, being employee share schemes and bonuses.
page 30 | AAMG annual report 2016
DIRECTORS’ REPORT cont’d
The NRC assess the appropriateness of the nature and amount of remuneration on a periodic basis by reference to recent
employment market conditions with the overall objective of ensuring maximum stakeholder benefit from the retention of
a high quality Board and Executive Team.
The payment of bonuses, share options and other incentive payments are reviewed by the NRC annually as part of the
review of executive remuneration and a recommendation is put to the Board for approval. All bonuses, options and
incentives must be linked to pre-determined performance criteria.
SHORT TERM INCENTIVE (“STI”)
AAMG performance measures involve the use of annual performance objectives, metrics, performance appraisals and
continuing emphasis on living the Company values.
The performance measures are set annually after consultation with the Directors and executives and are specifically
tailored to the areas where each executive has a level of control. The measures target areas the Board believes hold the
greatest potential for expansion and profit and cover financial and non-financial measures.
The Key Performance Indicators (“KPI’s”) for the Executive Team are summarised as follows:
Performance area:
• financial - operating profit and earnings per share; and
• non-financial - strategic goals set by each individual business unit based on job descriptions.
The STI Program incorporates both cash and share-based components for the Executive Team and other employees.
The Board may, at its discretion, award bonuses for exceptional performance in relation to each person’s pre-agreed KPIs.
VOTING AND COMMENTS MADE AT THE COMPANY’S LAST ANNUAL GENERAL MEETING
AAMG received more than 99% of ‘yes’ votes on its Remuneration Report for the financial year ended 31 August 2015. The
Company received no specific feedback on its Remuneration Report at the Annual General Meeting.
CONSEQUENCES OF PERFORMANCE ON SHAREHOLDER WEALTH
In considering the Group’s performance and benefits for shareholder wealth, the Board have regard to the following
indices in respect of the current financial year and the previous four financial years:
Item
EPS (S cents)*
Dividends (S cents per share)
Net (loss)/profit (S$000)
Share price (A$)
*continued operations
2016
2015
2014
2013
2012
(0.74)
-
(2,061)
0.12
0.49
-
559
0.08
(1.09)
-
(2,493)
0.08
0.12
0.20
231
0.14
1.35
0.50
2,506
0.09
USE OF REMUNERATION CONSULTANTS
AAMG did not make use of Remuneration Consultants during the financial year.
AAMG annual report 2016 | page 31
B.
DETAILS OF REMUNERATION
Details of the nature and amount of each element of the remuneration of each KMP of AAMG are shown in the table below:
Short term employee benefit
Post-
employment
benefit
Share
based
payments
Termination
benefits
Cash salary
and fees
Cash
bonus
Non-
monetary
benefits
Central
Provident
Fund
Options
Termination
payments
31 August 2016
S$
S$
S$
S$
S$
S$
Performance
based
percentage of
remuneration
%
Total
S$
Executive Director
Dato’ Dr Kai Chah Tan
2,400,000
65,000
Non-Executive Directors
Ms Pamela Anne
Jenkins (1)
-
Mr Wing Kwan Teh (2)
22,323
Mr Evgeny Tugolukov
15,663
Mr Kong Meng Ang (3)
-
Mr Heng Boo Fong
22,323
Mr Paul Vui Yung Lee
15,663
Ms Jeslyn Jacques
Wee Kian Leong
15,663
Other Key Management Personnel
-
-
-
-
-
-
-
Mr Cherinjit Kumar
Shori
258,300
65,730
Mr Meng Yau Yeoh
181,998
48,279
Ms Angela Chiew
Foong Choong
191,000
28,000
3,122,933 207,009
-
-
-
-
-
-
-
-
-
-
-
-
8,145
-
-
-
-
-
-
-
15,810
15,810
9,441
49,206
-
-
-
-
-
-
-
-
-
-
-
-
2,473,145
3%
-
-
-
-
-
-
-
-
-
-
22,323
15,663
-
22,323
15,663
15,663
339,840
246,087
228,441
-
3,379,148
-
-
-
-
-
-
-
19%
20%
12%
-
(1) Ms Pamela Anne Jenkins resigned as Managing Director and was redesignated from Executive Director to
Non-Executive Director on 1 June 2015. She subsequently resigned as Non-Executive Director on 30 September 2015.
(2) Mr Wing Kwan Teh resigned on 11 January 2016.
(3) Mr Kong Meng Ang was appointed on 22 January 2016.
page 32 | AAMG annual report 2016
DIRECTORS’ REPORT cont’d
Short term employee benefit
Post-
employment
benefit
Share
based
payments
Termination
benefits
Cash salary
and fees
Cash
bonus
Non-
monetary
benefits
Central
Provident
Fund
Options
Termination
payments
31 August 2015
S$
S$
S$
S$
S$
S$
Performance
based
percentage of
remuneration
%
Total
S$
Executive Director
Dato’ Dr Kai Chah Tan
2,400,000
43,300
Non-Executive Directors
Ms Pamela Anne
Jenkins (1)
375,000
Mr Wing Kwan Teh
23,437
Mr Evgeny Tugolukov
15,898
Mr Heng Boo Fong
23,437
Mr Paul Vui Yung Lee
15,898
Ms Jeslyn Jacques
Wee Kian Leong
15,898
Other Key Management Personnel
-
-
-
-
-
-
Mr Cherinjit Kumar
Shori
252,000
42,000
Mr Meng Yau Yeoh
169,992
28,332
Ms Angela Chiew
Foong Choong (2)
15,000
-
3,306,560
113,632
-
-
-
-
-
-
-
-
-
-
-
6,550
10,300
-
-
-
-
-
14,000
14,001
600
45,451
-
-
-
-
-
-
-
-
-
-
- 2,449,850
2%
-
-
-
-
-
-
-
-
385,300
23,437
15,898
23,437
15,898
15,898
308,000
212,325
15,600
- 3,465,643
-
-
-
-
-
-
14%
13%
-
-
(1) Ms Pamela Anne Jenkins resigned as Managing Director and was redesignated from Executive Director to
Non-Executive Director on 1 June 2015. She subsequently resigned as Non-Executive Director on 30 September 2015.
(2) Ms Angela Chiew Foong Choong was appointed on 1 August 2015.
The cash bonus relates to bonus that was vested during the year and is subject to approval by the Nomination and
Remuneration Committee. The cash bonus is paid between November and December every year and no part of the bonus
is payable in the future years. There was no bonus that was forfeited during the year.
C.
SERVICE AGREEMENTS
Remuneration and other terms of employment for the Executive Directors and other KMP are formalised in a service
agreement. The major provisions of the agreements relating to remuneration are set out below:
Name
Dato’ Dr Kai Chah Tan
Mr Cherinjit Kumar Shori
Mr Meng Yau Yeoh
Ms Angela Chiew Foong Choong
Base salary per month
(S$)
Term of agreement
Notice period
200,000
21,630
15,500
16,000
Unspecified
Unspecified
Unspecified
Unspecified
3 months
3 months
3 months
3 months
AAMG annual report 2016 | page 33
D.
SHARE-BASED REMUNERATION
All directors and executives may be allocated options to acquire shares in the Group under the Incentive Option Scheme
approved by shareholders from time to time. The last such scheme was approved by shareholders at the Annual General
Meeting of shareholders held on 6 December 2010.
Grant details
For the financial year ended
31 August 2015
Overall
Date
No.
Value $
(Note 1)
Exercised
no.
Exercised
$
Lapsed
no.
Lapsed
$
Vested
no.
Vested
%
Unvested
%
Lapsed
%
Percentage
Remuneration
that are
options
Group Key Management Personnel
Mr Cherinjit
Kumar Shori
Mr Meng Yau
Yeoh
17.1.2011
842,000 46,858
842,000
75,200
17.1.2011
457,000
25,433
457,000
40,140
1,299.000
115,340
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
0%
0%
Note 1
The value of options granted as remuneration and as shown in the above table has been determined in accordance with
applicable accounting standards.
page 34 | AAMG annual report 2016
DIRECTORS’ REPORT cont’d
E.
OTHER INFORMATION
KMP Options and Right Holdings
All KMP may be allocated options to acquire shares in the Group under the Incentive Option Scheme approved by
shareholders from time to time. The last such scheme was approved by shareholders at the Annual General Meeting of
shareholders held on 6 December 2010.
The number of options over ordinary shares held by each KMP of the Group during the financial year is as follows:
Balance at
beginning of
year
Granted as
remuneration
during the
year
Exercised
during the
year
Lapsed/
cancelled
Balance
at end of
year
Balance
vested
as end of
year
Vested
during
the year
31 August 2016
Dato’ Dr Kai Chah Tan
Ms Pamela Anne Jenkins (1)
Mr Wing Kwan Teh (2)
Mr Evgeny Tugolukov
Mr Kong Meng Ang (3)
Mr Heng Boo Fong
Mr Paul Vui Yung Lee
Ms Jeslyn Jacques Wee
Kian Leong
Mr Cherinjit Kumar Shori
842,000
Mr Meng Yau Yeoh
457,000
Ms Angela Chiew Foong
Choong
-
1,299,000
(1) Ms Pamela Anne Jenkins resigned on 30 September 2015
(2) Mr Wing Kwan Teh resigned on 11 January 2016
(3) Mr Kong Meng Ang appointed on 22 January 2016
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
(842,000)
(457,000)
-
(1,299,000)
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Balance at
beginning of
year
Granted as
remuneration
during the
year
Exercised
during the
year
Lapsed/
cancelled
Balance
at end of
year
Balance
vested
as end of
year
Vested
during
the year
31 August 2015
Dato’ Dr Kai Chah Tan
Ms Pamela Anne Jenkins (1)
Mr Wing Kwan Teh
Mr Evgeny Tugolukov
Mr Heng Boo Fong
Mr Paul Vui Yung Lee
Ms Jeslyn Jacques Wee
Kian Leong
Mr Cherinjit Kumar Shori
842,000
Mr Meng Yau Yeoh
457,000
Ms Angela Chiew Foong
Choong (2)
-
1,299,000
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
842,000
842,000
457,000
457,000
-
-
1,299,000 1,299,000
-
-
-
-
-
-
-
-
-
-
-
(1) Ms Pamela Anne Jenkins resigned on 30 September 2015
(2) Ms Angela Chiew Foong Choong was appointed on 1 August 2015
AAMG annual report 2016 | page 35
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
KMP SHAREHOLDINGS
The number of ordinary shares in Asian American Group Limited held by each KMP of the Group during the financial year
is as follows:
31 August 2016
Balance at
beginning of
year
Issued during the
year
Issued on
exercise of
options during
the year
Other
changes
during the
year
Dato’ Dr Kai Chah Tan
102,298,250
5,000,000
Ms Pamela Anne Jenkins
21,324,600
Mr Wing Kwan Teh
4,084,090
Mr Evgeny Tugolukov
21,000,000
Mr Kong Meng Ang
Mr Heng Boo Fong
Mr Paul Vui Yung Lee
Ms Jeslyn Jacques Wee Kian
Leong
Mr Cherinjit Kumar Shori
Mr Meng Yau Yeoh
Ms Angela Chiew Foong
Choong
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
842,000
457,000
-
Balance at end
of year
-
107,298,250
^(21,324,600)
*(4,084,090)
-
-
-
21,000,000
#34,000,000
34,000,000
-
-
-
-
-
-
-
-
-
842,000
457,000
-
148,706,940
5,000,000
1,299,000
8,591,310
163,597,250
^ Ms Pamela Anne Jenkins resigned on 30 September 2015
* Mr Wing Kwan Teh resigned on 11 January 2016
#Mr Kong Meng Ang appointed on 22 January 2016
31 August 2015
Balance at
beginning of
year
Issued during the
year
Issued on
exercise of
options during
the year
Other
changes
during the
year
Dato’ Dr Kai Chah Tan
102,298,250
Ms Pamela Anne Jenkins
21,324,600
Mr Wing Kwan Teh
4,084,090
Mr Evgeny Tugolukov
21,000,000
Mr Heng Boo Fong
Mr Paul Vui Yung Lee
Ms Jeslyn Jacques Wee Kian
Leong
Mr Cherinjit Kumar Shori
Mr Meng Yau Yeoh
Ms Angela Chiew Foong
Choong (1)
-
-
-
-
-
-
(1) Ms Angela Chiew Foong Choong was appointed on 1 August 2015
148,706,940
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Balance at end
of year
102,298,250
21,324,600
4,084,090
21,000,000
-
-
-
-
-
-
148,706,940
-
-
-
-
-
-
-
-
-
-
-
OTHER KMP TRANSACTIONS
There have been no other transactions involving equity instruments other than those described in the tables above. For
details of other transactions with KMP, there was a S$15,000 consultancy fee paid to Ms Pamela Anne Jenkin’s company
in the current financial year (2015: Nil).
End of audited remuneration report.
page 36 | AAMG annual report 2016
DIRECTORS’ REPORT cont’d
INDEMNIFICATION AND INSURANCE OF OFFICERS
During the year, AAMG paid a premium to insure officers of the Group. The officers of the Group covered by the insurance
policy include all Directors.
The liabilities insured are legal costs that may be incurred in defending civil or criminal proceedings that may be brought
against the officers in their capacity as officers of the Group, and any other payments arising from liabilities incurred by
the officers in connection with such proceedings, other than where such liabilities arise out of conduct involving a wilful
breach of duty by the officers or the improper use by the officers of their position or of information to gain advantage for
themselves or someone else to cause detriment to the Group.
Details of the amount of the premium paid in respect of insurance policies are not disclosed as such disclosure is prohibited
under the terms of the contract.
The Group has not otherwise, during or since the end of the financial year, except to the extent permitted by law, indemnified
or agreed to indemnify any current or former officer of the Group against a liability incurred as such by an officer.
PROCEEDINGS ON BEHALF OF THE COMPANY
No person has applied to the Court under section 237 of the Corporations Act 2001 for leave to bring proceedings on
behalf of the Company or to intervene in any proceedings to which the Company is a party for the purpose of taking
responsibility on behalf of the Company for all or part of those proceedings. There were no such proceedings brought or
interventions on behalf of the Company with leave from the Court under section 237 of the Corporations Act 2001.
NON-AUDIT SERVICES
During the year, Grant Thornton, the Group’s auditors, performed certain other services in addition to their statutory audit
duties.
The Board has considered the non-audit services provided during the year by the auditor and, in accordance with written
advice provided by resolution of the Audit Committee, is satisfied that the provision of those non-audit services during the
year is compatible with, and did not compromise, the auditor independence requirements of the Corporations Act 2001
for the following reasons:
• All non-audit services were subject to the corporate governance procedures adopted by the Group and have been
reviewed by the Audit Committee to ensure they do not impact upon the impartiality and objectivity of the auditor;
and
• The non-audit services do not undermine the general principles relating to auditor independence as set out in APES
110 Code of Ethics for Professional Accountants, as they did not involve reviewing or auditing the auditor’s own work,
acting in a management or decision-making capacity for the Group, acting as an advocate for the Group or jointly
sharing risks and rewards.
Details of the amounts paid to the auditors of the Group, Grant Thornton, and its related practices for audit and non-audit
services provided during the year are set out in note 8 to the Financial Statements.
AUDITOR’S INDEPENDENCE DECLARATION
A copy of the auditor’s independence declaration as required by section 307C of the Corporations Act 2001 for the year
ended 31 August 2016 has been received as set out immediately following the end of the Directors’ report.
The Report of Directors is signed in accordance with a resolution of the Board of Directors.
Dato’ Dr Kai Chah Tan
Executive Chairman
3 November 2016
AAMG annual report 2016 | page 37
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AUDITOR’S INDEPENDENCE DECLARATION
TO THE DIRECTORS OF ASIAN AMERICAN MEDICAL GROUP LIMITED
AUDITOR’S INDEPENDENCE DECLARATION
TO THE DIRECTORS OF ASIAN AMERICAN MEDICAL GROUP LIMITED
In accordance with the requirements of section 307C of the Corporations Act 2001, as lead
auditor for the audit of Asian American Medical Group Limited for the year ended
In accordance with the requirements of section 307C of the Corporations Act 2001, as lead
31 August 2016, I declare that, to the best of my knowledge and belief, there have been:
auditor for the audit of Asian American Medical Group Limited for the year ended
31 August 2016, I declare that, to the best of my knowledge and belief, there have been:
a
a
no contraventions of the auditor independence requirements of the Corporations Act
2001 in relation to the audit; and
no contraventions of the auditor independence requirements of the Corporations Act
2001 in relation to the audit; and
no contraventions of any applicable code of professional conduct in relation to the
audit.
no contraventions of any applicable code of professional conduct in relation to the
audit.
b
b
GRANT THORNTON AUDIT PTY LTD
Chartered Accountants
GRANT THORNTON AUDIT PTY LTD
Chartered Accountants
Sheenagh Edwards
Sheenagh Edwards
Partner - Audit & Assurance
Partner - Audit & Assurance
Adelaide, 3 November 2016
Adelaide, 3 November 2016
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a subsidiary or related entity of Grant Thornton Australia Ltd ABN 41 127 556 389
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page 38 | AAMG annual report 2016
Asian American
Medical Group Limited
ABN NUMBER 42 091 559 125
Annual report for the year ended
31 August 2016
AAMG annual report 2016 | page 39
Consolidated statement of profit or loss and
other comprehensive income
For the year ended 31 August 2016
Revenue from continuing operations
Other operating income
Changes in inventories
Inventories
Purchase services
Employment benefits expense
Operating lease expense
Depreciation
Directors’ fees
Finance expense
Provision for doubtful debts
Other expenses
(Loss)/profit before income tax
Income tax benefit/(expense)
(Loss)/profit for the year for continuing operations
Loss for the year for discontinued operations
(Loss)/profit for the year
Other comprehensive income/(loss):
Items that may be reclassified subsequently to profit or loss
Net effect of foreign currency translation
Consolidated Group
Year ended
Year ended
Note
31 August
2016
31 August
2015
S$
S$
3
3
4
13
6
9
5
17,082,845
20,354,104
170,992
27,061
103,275
(67,319)
(1,781,511)
(2,514,333)
(8,865,759)
(8,956,447)
(6,268,352)
(6,036,903)
(492,391)
(469,556)
(75,301)
(98,566)
(190,315)
(103,488)
-
(224,087)
(396)
-
(1,594,305)
(1,147,362)
(2,211,123)
1,063,009
150,000
(13,159)
(2,061,123)
1,049,850
-
(491,140)
(2,061,123)
558,710
220,956
(701,519)
Total comprehensive loss for the year
(1,840,167)
(142,809)
(Loss)/profit attributable to :
Members of the parent entity
Non-controlling interests
Total comprehensive loss attributable to :
Members of the parent entity
Non-controlling interests
(2,062,338)
598,064
1,215
(39,354)
(2,061,123)
558,710
(1,841,382)
(103,455)
1,215
(39,354)
(1,840,167)
(142,809)
These financial statements should be read in conjunction with the accompany notes.
These financial statements should be read in conjunction with the accompany notes.
page 40
aamg annual report 2016 Consolidated statement of profit or loss and
other comprehensive income (cont’d)
For the year ended 31 August 2016
Total comprehensive (loss)/income attributable to members of parent
entity:
Continuing operations
Discontinued operations
Earnings per share
Basic (loss)/earnings per share:
Continuing operations
Discontinued operations
Total
Diluted (loss)/earnings per share:
Continuing operations
Discontinued operations
Total
Consolidated Group
Year ended
Year ended
Note
31 August
2016
31 August
2015
S$
S$
(1,841,382)
387,685
-
(491,140)
(1,841,382)
(103,455)
11
11
11
11
(0.74)
-
(0.74)
(0.74)
-
(0.74)
0.49
(0.22)
0.27
0.49
(0.22)
0.27
These financial statements should be read in conjunction with the accompany notes.
AAMG annual report 2016 | page 41
Consolidated statement of financial position
As at 31 August 2016
ASSETS
Current assets
Cash and cash equivalents
Trade and other receivables
Inventories
Income tax refundable
Total current assets
Non-current assets
Plant and equipment
Intangible assets
Deferred tax asset
Total non-current assets
Total assets
LIABILITIES
Current liabilities
Trade and other payables
Current tax liabilities
Total current liabilities
Total liabilities
Net assets
EQUITY
Equity attributable to members of the parent entity:
Issued capital
Reserves
(Accumulated losses)/Retained earnings
Non-controlling interest
Total equity
Note
Consolidated Group
2016
S$
2015
S$
12
13
14
18
15
16
18
17
18
19
20
11,307,905
6,249,366
4,598,694
8,316,632
190,728
163,668
8,334
-
16,105,661
14,729,666
118,636
266,123
150,000
189,787
266,123
-
534,759
455,910
16,640,420
15,185,576
4,529,700
6,695,978
-
13,159
4,529,700
6,709,137
4,529,700
6,709,137
12,110,720
8,476,439
12,932,538
7,458,090
(374,557)
(523,334)
(559,122)
1,431,037
11,998,859
8,365,793
111,861
110,646
12,110,720
8,476,439
These financial statements should be read in conjunction with the accompany notes.
These financial statements should be read in conjunction with the accompany notes.
page 42
aamg annual report 2016
Consolidated statement of changes in equity
For year ended 31 August 2016
(Accumulated
losses)/
Retained
earnings
Foreign
currency
translation
reserve
Employee
share
option
reserve
Non-
controlling
interest
S$
S$
S$
S$
Issued
capital
S$
Total
S$
4,267,495
832,973
106,006
72,179
-
5,278,653
-
-
-
598,064
-
-
(701,519)
598,064
(701,519)
3,190,595
-
3,190,595
-
-
-
-
-
-
-
-
-
-
-
-
(39,354)
558,710
-
(701,519)
(39,354)
(142,809)
-
3,190,595
150,000
150,000
150,000 3,340,595
Balance at 1.9.2014
Total comprehensive
income:
Profit/(loss) for the year
Other comprehensive income
Transactions with owners in their
capacity as owners:
Issue of share capital (net of
share cost)
Issue of shares in subsidiary to
non-controlling interest
Balance at 31.8.2015
7,458,090
1,431,037
(595,513)
72,179
110,646
8,476,439
Balance at 1.9.2015
7,458,090
1,431,037
(595,513)
72,179
110,646
8,476,439
Total comprehensive income:
(Loss)/profit for the year
Other comprehensive income
Transactions with owners in their
capacity as owners:
Exercise of employee share
option
Issue of share capital (net of
share cost)
-
-
-
(2,062,338)
-
-
220,956
(2,062,338)
220,956
-
-
-
1,215 (2,061,123)
-
220,956
1,215 (1,840,167)
115,340
72,179
5,359,108
-
5,474,448
72,179
-
-
-
(72,179)
-
(72,179)
-
-
-
115,340
5,359,108
5,474,448
Balance at 31.8.2016
12,932,538
(559,122)
(374,557)
-
111,861
12,110,720
These financial statements should be read in conjunction with the accompany notes.
AAMG annual report 2016 | page 43
Consolidated statement of cash flows
For year ended 31 August 2016
Cash flows from operating activities
Receipts from customers
Payments to suppliers and employees
Income tax (paid)/refunded
Net cash used in continuing operations
Net cash used in discontinued operations
Net cash used in operating activities
Cash flows from investing activities
Purchase of plant and equipment
Interest received
Net cash generated from continuing operations
Net cash generated from discontinued operations
Net cash generated from investing activities
Cash flows from financing activities
Finance cost
Fixed deposits released
Proceeds from issue of new shares
Share issue expenses
Proceeds from issue of shares to non-controlling interest
Repayment of finance lease liabilities
Consolidated Group
Year ended
Year ended
Note
31 August 2016
31 August 2015
S$
S$
20,534,206
13,706,595
(21,082,572)
(14,888,646)
(21,493)
17,000
(569,859)
(1,165,051)
-
(717,394)
(569,859)
(1,882,445)
(4,150)
79,019
74,869
-
74,869
-
121,886
(61,282)
77,476
16,194
16,859
33,053
(396)
1,515,811
5,838,220
3,203,261
(363,772)
-
-
(12,666)
150,000
(29,580)
9
24
9
4
19
19
Net cash generated from financing activities
5,596,334
4,826,430
Net change in cash and cash equivalents held
5,101,344
2,977,038
Cash and cash equivalents at beginning of financial year
6,127,480
3,418,105
Effect of exchange rate change on cash held in foreign currencies
79,081
(267,663)
Cash and cash equivalents at end of financial year
12
11,307,905
6,127,480
These financial statements should be read in conjunction with the accompany notes.
page 44
aamg annual report 2016
Notes to the financial statements
For the year ended 31 August 2016
1.
Principle activities
Asian American Medical Group Limited (“AAMG” or “Company”) is a company domiciled in Australia. The
consolidated financial report of the Company as at and for year ended 31 August 2016 comprises the Company and
its subsidiaries. The principal activity of AAMG is that of provision of specialised medical services for liver diseases
and transplantation, radiation oncology and healthcare project management and consultancy services. Our blood
and bone marrow transplant segment, operated under Asian American Blood & Bone Marrow Transplant Centre Pte
Ltd (“AABMTC”), ceased operations on 31 December 2014. It subsequently changed its name to Asian American
Radiation Oncology Pte Ltd (“AARO”) and commenced operating a new radiation oncology segment thereafter.
AABMTC’s financial results up to the date of closure have been classified as “Discontinued Operations”. There has
been no change in the principal activity of the Group during the financial year.
AAMG is a for-profit entity for the purpose of preparing financial statements.
2.
Statement of significant accounting policies
This financial report includes the consolidated financial statements and notes of Asian American Medical Group
Limited (“AAMG”) and controlled entities (“Consolidated Group” or “Group”).
(a) Basis of preparation
The consolidated general purpose financial statements of the Group have been prepared in accordance with the
requirements of the Corporation Act 2001, Australian Accounting Standards and other authoritative pronouncements
of the Australian Accounting Standards Board. Compliance with Australian Accounting Standards results in full
compliance with the International Financial Reporting Standards (“IFRS”) as issued by the International Accounting
Standards Board (“IASB”).
Material accounting policies adopted in the preparation of this financial report are presented below and have been
consistently applied unless otherwise stated.
The financial report has been prepared on an accruals basis and is based on historical costs, modified, where
applicable, by the measurement at fair value of selected non-current assets, financial assets and financial liabilities.
AAMG is a company domiciled in Australia.
The consolidated final report is presented in Singapore Dollars (SGD or S$) as a significant portion of the group’s
activity is denominated in Singapore Dollars.
These consolidated financial statements have been approved for issue by the Board of Directors on 3 November
2016.
(b) Principles of consolidation
The Group financial statements consolidate those of the Parent company and all of its subsidiaries as of 31 August
2016. The Parent controls a subsidiary if it is exposed, or has rights, to variable returns from its involvement with the
subsidiary and has the ability to affect those returns through its power over the subsidiary. All subsidiaries have a
reporting date of 31 August.
All transactions and balances between Group companies are eliminated on consolidation, including unrealised
gains and losses on transactions between Group companies. Where unrealised losses on intragroup asset sales are
reversed on consolidation, the underlying asset is also tested for impairment from a group perspective. Amounts
reported in the financial statements of subsidiaries have been adjusted where necessary to ensure consistency with
the accounting policies adopted by the Group.
Profit or loss and other comprehensive income of subsidiaries acquired or disposed of during the year are recognised
from the effective date of acquisition, or up to the effective date of disposal, as applicable.
Non-controlling interests, presented as part of equity, represent the portion of a subsidiary’s profit or loss and
net assets that is not held by the Group. The Group attributes total comprehensive income or loss of subsidiaries
between the owners of the parent and the non-controlling interests based on their respective ownership interests.
AAMG annual report 2016 | page 45
(c) Business combinations
Business combinations occur where an acquirer obtains control over one or more businesses and results in the
consolidation of its assets and liabilities.
A business combination is accounted for by applying the acquisition method, unless it is a combination involving
entities or businesses under common control. The acquisition method requires that for each business combination
one of the combining entities must be identified as the acquirer (i.e. parent entity). The business combination will
be accounted for as at the acquisition date, which is the date that control over the acquiree is obtained by the
parent entity. At this date, the parent shall recognise, in the consolidated accounts, and subject to certain limited
exceptions, the fair value of the identifiable assets acquired and liabilities assumed. In addition, contingent liabilities
of the acquiree will be recognised where a present obligation has been incurred and its fair value can be reliably
measured.
The acquisition may result in the recognition of goodwill (refer Note 2(j)) or a gain from a bargain purchase. The
method adopted for the measurement of goodwill will impact on the measurement of any non-controlling interest to
be recognised in the acquiree where less than 100% ownership interest is held in the acquiree.
The acquisition date fair value of the consideration transferred for a business combination plus the acquisition
date fair value of any previously held equity interest shall form the cost of the investment in the separate financial
statements. Consideration may comprise the sum of the assets transferred by the acquirer, liabilities incurred by the
acquirer to the former owners of the acquiree and the entity interest issued by the acquirer.
Reverse acquisition, where the cost of the business combination is deemed to have been incurred by the legal
subsidiary (i.e. the acquirer for accounting purposes) in the form of equity instruments issued to the owners of the
legal parent (i.e. the acquiree for accounting purposes), are accounted for under AASB 3: Business Combinations.
The method calculates the fair value of the instruments issued by the legal parent on the basis of existing instruments
of the legal subsidiary.
All transaction costs incurred in relation to the business combination are expensed to the profit or loss.
Non-controlling interests, presented as part of equity, represent the portion of a subsidiary’s profit or loss and
net assets that is not held by the Group. The Group attributes total comprehensive income or loss of subsidiaries
between the owners of the parent and the non-controlling interests based on their respective ownership interests.
(d)
Income tax
The income tax expense (benefit) for the year comprises current income tax expense (benefit) and deferred tax
expense (benefit).
Current income tax expense charged to the profit or loss is the tax payable on taxable income calculated using
applicable income tax rates that have been enacted, or substantially enacted, as at reporting date. Current tax
liabilities (assets) are therefore measured at the amounts expected to be paid to (recovered from) the relevant
taxation authority.
Deferred income tax expense reflects movements in deferred tax asset and deferred tax liability balances during the
year as well unused tax losses.
Current and deferred income tax expense (benefit) is charged or credited directly to equity instead of the profit or
loss when the tax relates to items that are credited or charged directly to equity.
Deferred tax assets and liabilities are ascertained based on temporary differences arising between the tax bases of
assets and liabilities and their carrying amounts in the financial statements. Deferred tax assets also result where
amounts have been fully expensed but future tax deductions are available. No deferred income tax will be recognised
from the initial recognition of an asset or liability, excluding a business combination, where there is no effect on
accounting or taxable profit or loss.
Deferred tax assets and liabilities are calculated at the tax rates that are expected to apply to the period when the
asset is realised or the liability is settled, based on tax rates enacted or substantively enacted at reporting date. Their
measurement also reflects the manner in when management expects to recover or settle the carrying amount of the
related asset or liability.
Deferred tax assets relating to temporary differences and unused tax losses are recognised only to the extent that
it is probable that future taxable profit will be available against which the benefits of the deferred tax asset can be
utilised.
The amount of benefits brought to account or which may be realised in the future is based on the assumption that no
adverse change will occur in income tax legislation and the anticipation that the Company will derive sufficient future
assessable income to enable the benefit to be realised and comply with the conditions of deductibility imposed by
the law.
page 46
aamg annual report 2016
NOTES TO FINANCIAL STATEMENT cont’d
(e)
Inventories
Inventories are measured at the lower of cost and net realisable value.
The cost of inventories includes direct costs associated with the purchase of inventory including transportation
costs.
(f) Plant & equipment
Each class of plant and equipment is carried at cost less, where applicable, any accumulated depreciation and
impairment losses.
Plant and equipment are measured on the cost basis less depreciation and impairment losses.
The carrying amount of plant and equipment is reviewed annually by directors to ensure it is not in excess of the
recoverable amount from these assets. The recoverable amount is assessed on the basis of the expected net cash
flows that will be received from the asset’s employment and subsequent disposal. The expected net cash flows have
been discounted to their present values in determining recoverable amounts.
Subsequent costs are included in the asset’s carrying amount or recognised as a separate asset, as appropriate, only
when it is probable that future economic benefits associated with the item will flow to the Group and the cost of the
item can be measured reliably. All other repairs and maintenance are charged to the profit or loss during the financial
year in which they are incurred.
Depreciation
The depreciation of all fixed assets is depreciated on a straight line basis over the asset’s useful life to the Consolidated
Group commencing from the time the asset is held ready for use.
The depreciation rates used for each class of depreciable assets are:
Class of fixed asset
Office equipment
Medical equipment
Computers
Furniture and fittings
Renovations
Depreciation Rate
5 years
5 years
5 years
5 years
5 years
The asset’s residual values and useful lives are reviewed and adjusted if appropriate, at the end of each reporting
period.
An asset’s carrying amount is written down immediately to its recoverable amount if the asset’s carrying amount is
greater than its estimated recoverable amount.
Gains and losses on disposals are determined by comparing proceeds with the carrying amount. These gains and
losses are included in the profit or loss.
AAMG annual report 2016 | page 47
(g) Leases
Lease payments for operating leases, where substantially all the risks and benefits remain with the lessor, are charged
as expenses in the periods in which they are incurred.
The economic ownership of a leased asset is transferred to the lessee if the lessee bears substantially all the risks
and rewards related to the ownership of the leased asset. The related asset is then recognised at the inception of
the lease at the fair value of the leased asset or, if lower, the present value of the lease payments plus incidental
payments, if any. A corresponding amount is recognised as a finance leasing liability, irrespective of whether some
of these lease payments are payable up-front at the date of inception of the lease. Leases of land and buildings are
classified separately and are split into a land and a building element, in accordance with the relative fair values of the
leasehold interests at the date the asset is recognised initially.
Depreciation methods and useful lives for assets held under finance lease agreements correspond to those applied
to comparable assets which are legally owned by the Group. The corresponding finance leasing liability is reduced
by lease payments less finance charges, which are expensed as part of finance costs.
The interest element of leasing payments represents a constant proportion of the capital balance outstanding and is
charged to profit or loss over the period of the lease.
(h) Financial instruments
Initial recognition and measurement
Financial assets and financial liabilities are recognised when the entity becomes a party to the contractual provisions
to the instrument. For financial assets, this is equivalent to the date that the company commits itself to either the
purchase or sale of the asset (i.e. trade date accounting is adopted). Financial instruments are initially measured
at fair value plus transaction costs except where the instrument is classified “at fair value through profit or loss” in
which case transaction costs are expensed to the profit or loss immediately.
Classification and subsequent measurement
Financial instruments are subsequently measured at either fair value, amortised cost using the effective interest rate
method or cost. Fair value represents the price that would be received to sell an asset or paid to transfer a liability
in an orderly transaction between market participants at the measurement date. Where available, quoted prices in
an active market are used to determine fair value.
The Group does not designate any interest in subsidiaries, associates or joint venture entities as being subject to the
requirements of accounting standards specifically applicable to financial instruments.
(i) Loans and receivables
Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted
in an active market and are subsequently measured at amortised cost.
(ii) Held-to-maturity investments
These investments are non-derivative financial assets that have fixed maturities and fixed or determinable payments,
and it is the Group’s intention to hold these investments to maturity. They are subsequently measured at amortised
cost.
(iii) Available for sale financial assets
Available for sale financial assets are non-derivative assets that are either not suitable to be classified into other
categories of financial assets due to their nature or they are designated as such by management. They comprise
investments in the equity of other entities where there is neither a fixed maturity nor fixed or determinable payments.
Available for sale financial assets are included in non-current assets, except for those which are expected to mature
within 12 months after the end of the reporting year.
(iv) Financial liabilities
Non-derivative financial liabilities (excluding financial guarantees) are subsequently measured at amortised cost.
(v) Fair value
Fair value is determined based on current bid prices for all quoted investments. Valuation techniques are applied
to determine the fair value for all unlisted securities, including recent arm’s length transactions, reference to similar
instruments and option pricing models.
page 48
aamg annual report 2016
NOTES TO FINANCIAL STATEMENT cont’d
Impairment
At each reporting date, the Group assesses whether there is objective evidence that a financial instrument has been
impaired.
Derecognition
Financial assets are derecognised where the contractual rights to receipt of cash flows expires or the asset is
transferred to another party whereby the entity no longer has any significant continuing involvement in the risks
and benefits associated with the asset. Financial liabilities are derecognised where the related obligations are either
discharged, cancelled or expired. The difference between the carrying value of the financial liability extinguished or
transferred to another party and the fair value of consideration paid, including the transfer of non-cash assets or
liabilities assumed, is recognised in profit or loss.
(i)
Impairment of assets
At each reporting date, the Group reviews the carrying values of its tangible and intangible assets to determine
whether there is any indication that those assets have been impaired. If such an indication exists, the recoverable
amount of the asset, being the higher of the asset’s fair value less costs to sell and value in use, is compared to the
asset’s carrying value. Any excess of the asset’s carrying value over its recoverable amount is expensed to the profit
or loss.
Impairment testing is performed annually for goodwill.
(j)
Intangibles
Goodwill
Goodwill is carried at cost less accumulated impairment losses. Goodwill is calculated as the excess of the sum of:
(i) the consideration transferred;
(ii) any non-controlling interest; and
(iii) the acquisition date fair value of any previously held equity interests
over the acquisition date fair value of net identifiable assets acquired. Goodwill on acquisition of subsidiaries is
included in intangible assets.
Goodwill is tested for impairment annually and is allocated to the Group’s cash generating units or groups of cash
generating units, which represent the lowest level at which goodwill is monitored by where such level is not larger
than an operating segment.
(k) Foreign Currency Transactions and Balances
Functional and presentation currency
The functional currency of each of the Group’s entities is measured using the currency of the primary economic
environment in which that entity operates. The consolidated financial statements are presented in Singapore dollars
which is the Group’s functional and presentation currency.
Transaction and balances
Foreign currency transactions are translated into functional currency using the exchange rates prevailing at the date
of the transaction. Foreign currency monetary items are translated at the year-end exchange rate. Non-monetary
items measured at historical cost continue to be carried at the exchange rate at the date of the transaction. Non-
monetary items measured at fair value are reported at the exchange rate at the date when fair values were determined.
Exchange differences arising on the translation of monetary items are recognised in the statement of profit or loss
and other comprehensive income, except where deferred in equity as a qualifying cash flow or net investment hedge.
Exchange differences arising on the translation of non-monetary items are recognised directly in equity to the extent
that the gain or loss is directly recognised in equity, otherwise the exchange difference is recognised in the statement
of profit or loss and other comprehensive income.
Group companies
The financial results and position of foreign operations whose functional currency is different from the Group’s
presentation currency are translated as follows:
• assets and liabilities are translated at year-end exchange rates prevailing at that reporting date;
•
• retained earnings are translated at the exchange rates prevailing at the date of the transaction.
income and expenses are translated at average exchange rates for the year; and
Exchange differences are charged or credited to other comprehensive income and recognised in the foreign currency
translation reserve in equity.
AAMG annual report 2016 | page 49
(l) Employee benefits
Provision is made for the Group’s liability for employee benefits arising from services rendered by employees to
balance date. Employee benefits that are expected to be settled within one year are measured at the amounts
expected to be paid when the liability is settled, plus related on-costs. Employee benefits payable later than one
year are measured at the present value of the estimated future cash outflows to be made for those benefits. Those
cash flows are discounted using market yields on national government bonds with terms to maturity that match the
expected timing of cash flows.
Central Provident Fund (“CPF”) contributions: The Group makes contributions to the Central Provident Fund scheme
in Singapore, a defined contribution post-employment or pension scheme. Contributions to post-employment
benefits under defined contribution plans are recognised as an expense in the profit or loss as incurred.
Equity-settled compensation: The Group operates equity-settled share-based payment employee share and option
schemes. The fair value of the equity to which employees become entitled is measured at grant date and recognised
as an expense over the vesting period, with a corresponding increase to an equity account. The fair value of shares
is ascertained as the market bid price. The fair value of options is ascertained using a binomial option pricing
model which incorporates all market vesting conditions. The number of shares and options expected to vest is
reviewed and adjusted at the end of each reporting date such that the amount recognised for services received as
consideration for the equity instruments granted shall be based on the number of equity instruments that eventually
vest.
(m) Provisions
Provisions are recognised when the Group has a legal or constructive obligation, as a result of past events, for which
it is probable that an outflow of economic benefits will result and that outflow can be reliably measured.
(n) Cash and cash equivalents
Cash and cash equivalents includes cash on hand, demand deposits held with banks, other short-term highly liquid
investments that are readily convertible to known amounts of cash and which are subject to an insignificant risk of
changes in values.
(o) Revenue and other income
Revenue is measured at the fair value of the consideration received or receivable. Revenue from sale of medication
is recognised upon delivery of the medication to the patient. Revenue from rendering of medical services such as
medical consultation, surgery and transplantation is recognised upon completion of the consultation or procedure.
Interest revenue is recognised using the effective interest rate method, which, for floating rate financial assets, is the
rate inherent in the instrument.
All revenue is stated net of goods and services tax (“GST”).
(p) Trade and other payables
Trade and other payables represent the liability outstanding at the end of the reporting year for goods and services
received by the Group during the reporting year which remains unpaid. The balance is recognised as a current
liability with the amount being normally paid within 30 days of initial recognition.
(q) Goods and services tax
Revenues, expenses and assets are recognised net of the amount of GST, except where the amount of GST incurred
is not recoverable from the Australian Tax Office (“ATO”) or Inland Revenue Authority of Singapore (“IRAS”). In
these circumstances the GST is recognised as part of the cost of acquisition of the asset or as part of the expense.
Receivables and payables are stated in the statement of financial position inclusive of GST.
The net amount of GST recoverable from, or payable to, the ATO or IRAS is included as a current asset or liability in
the statement of financial position.
Cash flows are included in the statement of cash flows on a gross basis. The GST components of cash flows arising
from investing and financing activities which are recoverable from, or payable to, the ATO or IRAS are classified as
operating cash flows.
page 50
aamg annual report 2016
NOTES TO FINANCIAL STATEMENT cont’d
(r) Share-based employee remuneration
The Group operates equity-settled share-based remuneration plans for its employees. None of the Group’s plans
feature any options for a cash settlement.
All goods and services received in exchange for the grant of any share-based payment are measured at their fair
values. Where employees are rewarded using share-based payments, the fair values of employees’ services are
determined indirectly by reference to the fair value of the equity instruments granted. This fair value is appraised at
the grant date and excludes the impact of non-market vesting conditions (for example profitability and sales growth
targets and performance conditions).
All share-based remuneration is ultimately recognised as an expense in profit or loss with a corresponding credit to
‘share option reserve’.
If vesting periods or other vesting conditions apply, the expense is allocated over the vesting period, based on the
best available estimate of the number of share options expected to vest. Non-market vesting conditions are included
in assumptions about the number of options that are expected to become exercisable. Estimates are subsequently
revised if there is any indication that the number of share options expected to vest differs from previous estimates.
Any cumulative adjustment prior to vesting is recognised in the current period. No adjustment is made to any
expense recognised in prior periods if share options ultimately exercised are different to that estimated on vesting.
Upon exercise of share options, the proceeds received net of any directly attributable transaction costs up are
allocated to share capital.
(s) Transaction costs on the issue of equity instruments
Transaction costs arising from the issue of equity instruments are recognised directly in equity as a reduction of
the proceeds of the equity instruments to which the costs relate. Transaction costs are the costs that are incurred
directly in connection with the issue of those equity instruments and which would not have been incurred had those
instruments not been issued.
(t) Comparative figures
When required by Accounting Standards, comparative figures have been adjusted to conform to changes in
presentation for the current financial year.
AAMG annual report 2016 | page 51
Likely impact on
initial application
Effective
date (annual
reporting
periods
beginning on
or after...)
1 January 2018 When this
standard is first
adopted for the
year ending 31
August 2019,
there will be no
material impact on
the transactions
and balances
recognised in
the financial
statements.
(u) Standards and Interpretations issued but not yet effective
New / revised
pronouncement
Superseded
pronouncement
Nature of change
AASB 139 Financial
Instruments:
Recognition and
Measurement
AASB 9
Financial
Instruments
(December
2014)
[Also refer to
AASB 2013-9
and
AASB 2014-1
below]
AASB 9 introduces new requirements
for the classification and measurement
of financial assets and liabilities and
includes a forward-looking ‘expected
loss’ impairment model and a
substantially-changed approach to
hedge accounting.
These requirements improve and
simplify the approach for classification
and measurement of financial assets
compared with the requirements of
AASB 139. The main changes are:
a Financial assets that are debt
instruments will be classified based
on: (i) the objective of the entity’s
business model for managing
the financial assets; and (ii) the
characteristics of the contractual
cash flows.
b Allows an irrevocable election on
initial recognition to present gains
and losses on investments in equity
instruments that are not held for
trading in other comprehensive
income (instead of in profit or
loss). Dividends in respect of these
investments that are a return on
investment can be recognised
in profit or loss and there is no
impairment or recycling on disposal
of the instrument.
Introduces a ‘fair value through
other comprehensive income’
measurement category for particular
simple debt instruments.
c
d Financial assets can be designated
and measured at fair value through
profit or loss at initial recognition if
doing so eliminates or significantly
reduces a measurement or
recognition inconsistency that would
arise from measuring assets or
liabilities, or recognising the gains
and losses on them, on different
bases.
e Where the fair value option is used
for financial liabilities the change in
fair value is to be accounted for as
follows:
• the change attributable to changes
in credit risk are presented in Other
Comprehensive Income (‘OCI’)
• the remaining change is presented
in profit or loss
If this approach creates or enlarges
an accounting mismatch in the profit
or loss, the effect of the changes
in credit risk are also presented in
profit or loss.
page 52
aamg annual report 2016 NOTES TO FINANCIAL STATEMENT cont’d
New / revised
pronouncement
Superseded
pronouncement
Nature of change
Likely impact on
initial application
Effective
date (annual
reporting
periods
beginning on
or after...)
AASB 9
Financial
Instruments
(December
2014)
continued
None
ASB 1057
Application
of Australian
Accounting
Standards
AASB 15
Revenue from
Contracts with
Customers
AASB 118 Revenue
AASB 111
Construction
Contracts
Int. 13 Customer
Loyalty Programmes
Int. 15 Agreements
for the Construction
of Real Estate
Int. 18 Transfer
of Assets from
Customers
Int. 131 Revenue –
Barter Transactions
Involving Advertising
Services
Int. 1042 Subscriber
Acquisition Costs
in the
Telecommunications
Industry
Otherwise, the following
requirements have generally been
carried forward unchanged from
AASB 139 into AASB 9:
• classification and measurement of
financial liabilities; and
• derecognition requirements for
financial assets and liabilities
AASB 9 requirements regarding hedge
accounting represent a substantial
overhaul of hedge accounting that
enable entities to better reflect their
risk management activities in the
financial statements.
Furthermore, AASB 9 introduces a new
impairment model based on expected
credit losses. This model makes use of
more forward-looking information and
applies to all financial instruments that
are subject to impairment accounting.
In May 2015, the AASB decided to
revise Australian Accounting Standards
that incorporate IFRSs to minimise
Australian-specific wording even
further. The AASB noted that IFRSs
do not contain application paragraphs
that identify the entities and financial
reports to which the Standards (and
Interpretations) apply. As a result, the
AASB decided to move the application
paragraphs previously contained in
each Australian Accounting Standard
(or Interpretation), unchanged, into a
new Standard AASB 1057 Application of
Australian Accounting Standards.
AASB 15:
• replaces AASB 118 Revenue, AASB
111 Construction Contracts and some
revenue-related Interpretations:
- establishes a new revenue
recognition model
- changes the basis for deciding
whether revenue is to be
recognised over time or at a point
in time
- provides new and more detailed
guidance on specific topics (e.g.
multiple element arrangements,
variable pricing, rights of return,
warranties and licensing)
- expands and improves disclosures
about revenue
In May 2015, the AASB issued ED
260 Income of Not-for-Profit Entities,
proposing to replace the income
recognition requirements of AASB 1004
Contributions and provide guidance to
assist not-for-profit entities to apply
the principles of AASB 15. The ED
was open for comment until 14 August
2015 and the AASB is currently in the
process of redeliberating its proposals
with the aim of releasing the final
amendments in late 2016.
1 January 2016 When this
Standard is first
adopted for the
year ending 31
August 2017, there
will be no impact
on the financial
statements.
1 January 2018 When this
Standard is first
adopted for the
year ending 31
August 2019,
there will be no
material impact on
the transactions
and balances
recognised in
the financial
statements.
AAMG annual report 2016 | page 53
Effective
date (annual
reporting
periods
beginning on
or after...)
1 January 2019
New / revised
pronouncement
Superseded
pronouncement
Nature of change
AASB 16 Leases AASB 117 Leases
Int. 4 Determining
whether an
Arrangement
contains a Lease
Int. 115 Operating
Leases—Lease
Incentives
Int. 127 Evaluating
the Substance
of Transactions
Involving the Legal
Form of a Lease
AASB 16:
• replaces AASB 117 Leases and some
lease-related Interpretations
• requires all leases to be accounted
for ‘on-balance sheet’ by lessees,
other than short-term and low value
asset leases
• provides new guidance on the
application of the definition of
lease and on sale and lease back
accounting
• largely retains the existing lessor
accounting requirements in AASB 117
• requires new and different disclosures
about leases
Note that ASIC is expected to include
the disclosure of the impact of AASB 16
as a key focus area for the 30 June 2016
reporting season.
Likely impact on
initial application
The entity is yet
to undertake
a detailed
assessment
of the impact
of AASB 16.
However, based
on the entity’s
preliminary
assessment, the
likely impact on
the first time
adoption of the
Standard for the
year ending 31
August 2020
includes:
· there will be
a significant
increase in
lease assets
and financial
liabilities
recognised on
the balance
sheet
· the reported
equity will
reduce as the
carrying amount
of lease assets
will reduce more
quickly than the
carrying amount
of lease liabilities
· EBIT in the
statement of
profit or loss
and other
comprehensive
income will
be higher as
the implicit
interest in lease
payments for
former off
balance sheet
leases will be
presented as
part of finance
costs rather than
being included
in operating
expenses
page 54
aamg annual report 2016 NOTES TO FINANCIAL STATEMENT cont’d
New / revised
pronouncement
Superseded
pronouncement
Nature of change
AASB 16 Leases
continued
Effective
date (annual
reporting
periods
beginning on
or after...)
Likely impact on
initial application
· operating cash
outflows will
be lower and
financing cash
flows will be
higher in the
statement of
cash flows
as principal
repayments
on all lease
liabilities will
now be included
in financing
activities rather
than operating
activities.
Interest can
also be included
within financing
activities
None
None
AASB 2014-1
Amendments
to Australian
Accounting
Standards
(Part D:
Consequential
Amendments
arising from
AASB 14)
AASB 2014-3
Amendments
to Australian
Accounting
Standards –
Accounting for
Acquisitions of
Interests in Joint
Operations
1 January 2016 When these
amendments
become effective
for the first time
for the year
ending 30 June
2017, they will not
have any impact
on the entity.
1 January 2016 When these
amendments are
first adopted for
the year ending
30 June 2017,
there will be no
material impact on
the transactions
and balances
recognised in
the financial
statements.
Part D of AASB 2014-1 makes
consequential amendments arising from
the issuance of AASB 14.
The amendments to AASB 11 state
that an acquirer of an interest in a joint
operation in which the activity of the
joint operation constitutes a ‘business’,
as defined in AASB 3 Business
Combinations, should:
1 Apply all of the principles on
business combinations accounting
in AASB 3 and other Australian
Accounting Standards except
principles that conflict with
the guidance of AASB 11. This
requirement also applies to the
acquisition of additional interests
in an existing joint operation that
results in the acquirer retaining joint
control of the joint operation (note
that this requirement applies to
the additional interest only, i.e. the
existing interest is not re-measured)
and to the formation of a joint
operation when an existing business
is contributed to the joint operation
by one of the parties that participate
in the joint operation; and
2 Provide disclosures for business
combinations as required by AASB
3 and other Australian Accounting
Standards.
AAMG annual report 2016 | page 55
New / revised
pronouncement
Superseded
pronouncement
Nature of change
Likely impact on
initial application
Effective
date (annual
reporting
periods
beginning on
or after...)
1 January 2016 When these
amendments are
first adopted for
the year ending
31 August 2017,
there will be no
material impact on
the transactions
and balances
recognised in
the financial
statements.
The amendments to AASB 116
prohibit the use of a revenue-based
depreciation method for property,
plant and equipment. Additionally,
the amendments provide guidance
in the application of the diminishing
balance method for property, plant and
equipment.
The amendments to AASB 138 present
a rebuttable presumption that a
revenue-based amortisation method
for intangible assets is inappropriate.
This rebuttable presumption can
be overcome (i.e. a revenue-based
amortisation method might be
appropriate) only in two (2) limited
circumstances:
1 The intangible asset is expressed as
a measure of revenue, for example
when the predominant limiting
factor inherent in an intangible asset
is the achievement of a revenue
threshold (for instance, the right to
operate a toll road could be based
on a fixed total amount of revenue
to be generated from cumulative
tolls charged); or
2 When it can be demonstrated that
revenue and the consumption of the
economic benefits of the intangible
asset are highly correlated.
AASB 2014-5 incorporates the
consequential amendments arising from
the issuance of AASB 15.
1 January 2018 Refer to the
section on AASB
15 above.
AASB 2014-7 incorporates the
consequential amendments arising from
the issuance of AASB 9.
1 January 2018 Refer to the
section on AASB 9
above.
The amendments introduce the equity
method of accounting as one of the
options to account for an entity’s
investments in subsidiaries, joint
ventures and associates in the entity’s
separate financial statements.
1 January 2016 When these
amendments are
first adopted for
the year ending
31 August 2017,
there will be no
material impact
on the financial
statements.
None
AASB 2014-4
Amendments
to Australian
Accounting
Standards –
Clarification
of Acceptable
Methods of
Depreciation
and
Amortisation
None
None
None
AASB 2014-5
Amendments
to Australian
Accounting
Standards
arising from
AASB 15
AASB 2014-7
Amendments
to Australian
Accounting
Standards
arising from
AASB 9
(December
2014)
AASB 2014-9
Amendments
to Australian
Accounting
Standards –
Equity Method
in Separate
Financial
Statements
page 56
aamg annual report 2016 NOTES TO FINANCIAL STATEMENT cont’d
Likely impact on
initial application
Effective
date (annual
reporting
periods
beginning on
or after...)
1 January 2018 When these
amendments are
first adopted for
the year ending
31 August 2019,
there will be no
material impact
on the financial
statements.
1 January 2016 When these
amendments are
first adopted for
the year ending
31 August 2017,
there will be no
material impact
on the financial
statements.
New / revised
pronouncement
Superseded
pronouncement
Nature of change
None
AASB 2014-10
Amendments
to Australian
Accounting
Standards – Sale
or Contribution
of Assets
between an
Investor and its
Associate or
Joint Venture
None
AASB 2015-1
Amendments
to Australian
Accounting
Standards
– Annual
Improvements
to Australian
Accounting
Standards 2012-
2014 Cycle
The amendments address a current
inconsistency between AASB 10
Consolidated Financial Statements and
AASB 128 Investments in Associates
and Joint Ventures.
The amendments clarify that, on a
sale or contribution of assets to a joint
venture or associate or on a loss of
control when joint control or significant
influence is retained in a transaction
involving an associate or a joint venture,
any gain or loss recognised will depend
on whether the assets or subsidiary
constitute a business, as defined
in AASB 3 Business Combinations.
Full gain or loss is recognised when
the assets or subsidiary constitute
a business, whereas gain or loss
attributable to other investors’ interests
is recognised when the assets or
subsidiary do not constitute a business.
This amendment effectively introduces
an exception to the general requirement
in AASB 10 to recognise full gain or loss
on the loss of control over a subsidiary.
The exception only applies to the loss
of control over a subsidiary that does
not contain a business, if the loss of
control is the result of a transaction
involving an associate or a joint venture
that is accounted for using the equity
method. Corresponding amendments
have also been made to AASB 128.
AASB 2015-10 Amendments to
Australian Accounting Standards –
Effective Date of Amendments to
AASB 10 and AASB 128 deferred the
mandatory application date of AASB
2014-10 from 1 January 2016 to 1
January 2018. Refer to the section
on AASB 2015-10 below for further
information.
These amendments arise from the
issuance of Annual Improvements to
IFRSs 2012-2014 Cycle in September
2014 by the IASB.
Among other improvements, the
amendments clarify that when an
entity reclassifies an asset (or disposal
group) directly from being held for
sale to being held for distribution (or
vice-versa), the accounting guidance
in paragraphs 27-29 of AASB 5 Non-
current Assets Held for Sale and
Discontinued Operations does not
apply. The amendments also state that
when an entity determines that the
asset (or disposal group) is no longer
available for immediate distribution
or that the distribution is no longer
highly probable, it should cease held-
for-distribution accounting and apply
the guidance in paragraphs 27-29 of
AASB 5.
AAMG annual report 2016 | page 57
Likely impact on
initial application
Effective
date (annual
reporting
periods
beginning on
or after...)
1 January 2016 When these
amendments are
first adopted for
the year ending
31 August 2017,
there will be no
material impact
on the financial
statements.
1 January 2017 Refer to the
section on AASB
15 above.
1 January 2016 When this
Standard is first
adopted for the
year ending 31
August 2017, there
will be no impact
on the financial
statements.
New / revised
pronouncement
Superseded
pronouncement
Nature of change
None
AASB 2015-2
Amendments
to Australian
Accounting
Standards
– Disclosure
Initiative:
Amendments to
AASB 101
None
None
AASB 2015-8
Amendments
to Australian
Accounting
Standards –
Effective Date
of AASB 15
AASB 2015-9
Amendments
to Australian
Accounting
Standards –
Scope and
Application
Paragraphs
page 58
The Standard makes amendments to
AASB 101 Presentation of Financial
Statements arising from the IASB’s
Disclosure Initiative project.
The amendments:
• clarify the materiality requirements
in AASB 101, including an emphasis
on the potentially detrimental effect
of obscuring useful information with
immaterial information
• clarify that AASB 101’s specified line
items in the statement(s) of profit
or loss and other comprehensive
income and the statement of financial
position can be disaggregated
• add requirements for how an entity
should present subtotals in the
statement(s) of profit and loss and
other comprehensive income and the
statement of financial position
• clarify that entities have flexibility as
to the order in which they present
the notes, but also emphasise that
understandability and comparability
should be considered by an entity
when deciding that order
• remove potentially unhelpful
guidance in AASB 101 for identifying
a significant accounting policy
AASB 2015-8 amends the mandatory
application date of AASB 15 Revenue
from Contracts with Customers so that
AASB 15 is required to be applied for
annual reporting periods beginning
on or after 1 January 2018 instead
of 1 January 2017. It also defers the
consequential amendments that were
originally set out in AASB 2014-5
Amendments to Australian Accounting
Standards arising from AASB 15.
AASB 2015-9 inserts scope paragraphs
into AASB 8 Operating Segments and
AASB 133 Earnings per Share in place
of application paragraph text in AASB
1057.
In July and August 2015, the AASB
reissued AASB 8, AASB 133 and
most of the Australian Accounting
Standards that incorporate IFRSs to
make editorial changes. The application
paragraphs in the previous versions of
AASB 8 and AASB 133 covered scope
paragraphs that appear separately in
the corresponding IFRS 8 and IAS 33.
In moving those application paragraphs
to AASB 1057 when AASB 8 and
AASB 133 were reissued in August,
the AASB inadvertently deleted the
scope details from AASB 8 and AASB
133. This amending Standard puts the
scope details into those Standards,
and removes the related text from
AASB 1057. There is no change to the
requirements or the applicability of
AASB 8 and AASB 133.
aamg annual report 2016 New / revised
pronouncement
Superseded
pronouncement
Nature of change
None
AASB 2015-10
Amendments
to Australian
Accounting
Standards –
Effective Date
of Amendments
to AASB 10 and
AASB 128
None
None
AASB 2016-1
Amendments
to Australian
Accounting
Standards –
Recognition
of Deferred
Tax Assets for
Unrealised
Losses
AASB 2016-2
Amendments
to Australian
Accounting
Standards
– Disclosure
Initiative:
Amendments to
AASB 107
NOTES TO FINANCIAL STATEMENT cont’d
This Standard defers the mandatory
application date of amendments
to AASB 10 Consolidated Financial
Statements and AASB 128 Investments
in Associates and Joint Ventures that
were originally made in AASB 2014-10
Amendments to Australian Accounting
Standards – Sale or Contribution of
Assets between an Investor and its
Associate or Joint Venture so that the
amendments are required to be applied
for annual reporting periods beginning
on or after 1 January 2018 instead of 1
January 2016.
The amendments have been deferred
as the IASB is planning to address
them as part of its longer term Equity
Accounting project. However, early
application of the amendments is still
permitted.
AASB 2016-1 amends AASB 112 Income
Taxes to clarify how to account for
deferred tax assets related to debt
instruments measured at fair value,
particularly where changes in the
market interest rate decrease the fair
value of a debt instrument below cost.
Likely impact on
initial application
Effective
date (annual
reporting
periods
beginning on
or after...)
1 January 2016 Refer to the
section on AASB
2014-10 above.
1 January 2017 When these
amendments are
first adopted for
the year ending
31 August 2018,
there will be no
material impact
on the financial
statements.
AASB 2016-2 amends AASB 107
Statement of Cash Flows to require
entities preparing financial statements
in accordance with Tier 1 reporting
requirements to provide disclosures
that enable users of financial
statements to evaluate changes
in liabilities arising from financing
activities, including both changes
arising from cash flows and non-cash
changes.
1 January 2017 When these
amendments are
first adopted for
the year ending
31 August 2018,
there will be no
material impact
on the financial
statements.
AAMG annual report 2016 | page 59
Likely impact on
initial application
Effective
date (annual
reporting
periods
beginning on
or after...)
1 January 2018 When these
amendments are
first adopted for
the year ending
31 August 2019,
there will be no
material impact
on the financial
statements.
New / revised
pronouncement
Superseded
pronouncement
Nature of change
Standards issued by the IASB, but not yet by the AASB
None
Clarifications to
IFRS 15 Revenue
from Contracts
with Customers
The amendments clarify the application
of IFRS 15 in three (3) specific areas
to reduce the extent of diversity in
practice that might otherwise result
from differing views on how to
implement the requirements of the new
standard. They will help companies:
1. Identify performance obligations (by
clarifying how to apply the concept
of ‘distinct’);
2. Determine whether a company is a
principal or an agent in a transaction
(by clarifying how to apply the
control principle);
3. Determine whether a licence
transfers to a customer at a point in
time or over time (by clarifying when
a company’s activities significantly
affect the intellectual property to
which the customer has rights).
The amendments also create two (2)
additional practical expedients available
for use when implementing IFRS 15:
1. For contracts that have been
modified before the beginning of
the earliest period presented, the
amendments allow companies to
use hindsight when identifying
the performance obligations,
determining the transaction price,
and allocating the transaction price
to the satisfied and unsatisfied
performance obligations.
2. Companies applying the full
retrospective method are permitted
to ignore contracts already complete
at the beginning of the earliest
period presented.
The AASB is expected to publish the
equivalent Australian amendments in
quarter 2 of 2016.
page 60
aamg annual report 2016 NOTES TO FINANCIAL STATEMENT cont’d
(v) New and revised standards that are effective for these financial statements
A number of new and revised standards became effective for the first time to annual periods beginning on or after 1
July 2015. Information on the more significant standard(s) is presented below.
AASB 2015-4 Amendments to Australian Accounting Standards – Financial Reporting Requirements for Australian
Groups with a Foreign Parent
AASB 2015-4 amends AASB 128 Investments in Associates and Joint Ventures to ensure that its reporting requirements
on Australian groups with a foreign parent align with those currently available in AASB 10 Consolidated Financial
Statements for such groups. AASB 128 will now only require the ultimate Australian entity to apply the equity
method in accounting for interests in associates and joint ventures, if either the entity or the group is a reporting
entity, or both the entity and group are reporting entities.
AASB 2015-4 is applicable to annual reporting periods beginning on or after 1 July 2015.
The adoption of this amendment has not had a material impact on the Group.
(w) Critical accounting estimates and judgements
The directors evaluate estimates and judgements incorporated into the financial report based on historical knowledge
and best available information. Estimates assume a reasonable expectation of future events and are based on current
trends and economic data, obtained both externally and within the Group.
(x) Key Estimates and Judgements
Impairment
The Group assesses impairment at each reporting date by evaluating conditions and events specific to the Group
that may lead to impairment of assets. Where an impairment trigger exists, the recoverable amount of the asset is
determined. Value in use calculations and valuations from independent valuers are performed and used in assessing
recoverable amounts, these calculations and valuations incorporate a number of key estimates.
Please refer to note 13 and 16 with respect to Management’s consideration of impairment of trade and other
receivables and goodwill respectively, as at 31 August 2016.
AAMG annual report 2016 | page 61
3 Revenue
Operating activities
Provision of services
Sale of medication
Management fee
Total revenue from operating activities
Other operating income
Interest received
Other income
Total other operating income
Consolidated Group
2016
S$
2015
S$
13,776,576
15,667,083
2,740,879
565,390
3,811,481
875,540
17,082,845
20,354,104
79,019
91,973
170,992
78,775
24,500
103,275
Consolidated Group
2016
S$
2015
S$
4 Finance expense
Interest expense on obligation under finance lease
-
396
5 (Loss)/profit for the year
The (loss)/profit for the year has been arrived at after (charging)/crediting the following items:
Expenses
Cost of sales
Net foreign exchange (loss)/gain
Consolidated Group
2016
S$
2015
S$
(10,620,209)
(11,538,099)
(149,312)
3,505
Administrative expenses include rental expense on operating leases as follows:
- premises
(492,391)
(485,167)
Depreciation is reflected in the statement of profit or loss and other comprehen-
sive income as follows:
- continuing operations
- discontinued operations
Provision for doubtful debts (note 13(a))
Professional fees
Management fees
Credit card charges
Central Provident Fund
page 62
(75,301)
-
(224,087)
(409,357)
(166,163)
(59,730)
(211,554)
(98,566)
(30,899)
-
(366,018)
(214,088)
(54,133)
(192,263)
aamg annual report 2016
NOTES TO FINANCIAL STATEMENT cont’d
6 Income Tax (Benefit)/Expense
a. The components of tax (benefit)/expense comprise:
Current tax
Deferred tax
Over provision in respect of prior years
Consolidated Group
2016
S$
-
(150,000)
-
(150,000)
2015
S$
16,448
-
(3,289)
13,159
b. The prima facie tax on (loss)/ profit before income tax is reconciled to the income tax as follows:
Prima facie tax (refundable)/payable on (loss)/profit before income
tax at Australian tax rate of 30% (2015 : 30%)
(663,337)
171,560
Add:
Effect of tax rates in foreign jurisdiction
223,158
(206,154)
Tax effect of:
- non-deductible expenses
- non-taxable incomes
- over provision for income tax in prior years
- partial income tax exemption
- utilisation of deferred tax assets previously not recognised
- deferred tax asset not recognised
- others
Income tax (benefit)/expense
69,578
(14,058)
-
-
9,628
225,031
-
(150,000)
255,701
(52,792)
(3,289)
(24,348)
(217,394)
96,924
(7,049)
13,159
The value of tax losses and capital allowances not recognised is S$6,768,000 and S$426,000 respectively (2015:
S$5,270,000 and S$415,000).
AAMG annual report 2016 | page 63
7 Key Management Personnel Compensation
The key management personnel (“KMP”) compensation included in employment expenses includes:
Short-term benefits
Post-employment benefit
Total compensation
Detailed remuneration disclosures are provided in the remuneration report.
8 Auditor’s Remuneration
Remuneration of the parent entity auditor, Grant Thornton Audit Pty Ltd:
- auditing or reviewing the financial report
- taxation services
Remuneration of other auditors:
- auditing or reviewing the financial report of subsidiaries
- taxation services
- due diligence services
2016
S$
2015
S$
3,329,942
3,420,192
49,206
45,451
3,379,148
3,465,643
Consolidation Group
2016
S$
26,865
7,238
69,300
8,900
26,000
2015
S$
27,556
12,188
32,320
4,900
-
page 64
aamg annual report 2016 NOTES TO FINANCIAL STATEMENT cont’d
9 Discontinued Operations
Our blood and bone marrow transplant segment, operated under Asian American Blood & Bone Marrow Transplant Centre
Pte Ltd (“AABMTC”), ceased operations on 31 December 2014. It subsequently changed its name to Asian American
Radiation Oncology Pte Ltd (“AARO”) and commenced operating a new radiation oncology segment thereafter in
the previous financial year. AABMTC’s financial results up to the date of closure have been classified as “Discontinued
Operations” in the prior year’s Consolidated Statement of Profit or Loss and Other Comprehensive Income.
Results of the discontinued operations are as follows:
Consolidation Group
Revenue
Other income
Changes in inventories
Raw materials and consumables used
Employment benefits expense
Operating lease expense
Depreciation expense
Directors’ fees
Write down of inventory
Write down of capital assets
Other operating income/(expenses) - net
Loss for the year from discontinued operations
2016
S$
-
-
-
-
-
-
-
-
-
-
-
-
2015
S$
512,201
37,590
(63,016)
(248,791)
(334,711)
(96,321)
(30,899)
(32,000)
(108,515)
(183,522)
56,844
(491,140)
Prior to the conversion to the new radiation oncology segment, all the financial assets and liabilities relating to the dis-
continued operations have been fully recovered, paid, written down and disposed of. However, certain assets have been
carried over to the new segment as follows:
Non-current assets:
-
Plant and equipment
Current assets:
-
-
Cash and cash equivalent
Trade and other receivables
Assets carried forward for new business segment
Current liabilities:
-
Trade and other payables
Liabilities carried forward for new business
segment
2015
S$
48,606
549,742
43,736
642,084
75,583
75,583
AAMG annual report 2016 | page 65
Cash flows generated by blood and bone marrow segment for the prior year reporting period under review until the
disposal are as follows:
Operating activities
Investing activities
Cash flows from discontinued operations
10 Dividends
Consolidation Group
2016
S$
-
-
-
2015
S$
(717,394)
16,859
(700,535)
No interim or final dividend has been paid during the year or recommended by the Directors following the completion of
accounts for the financial year ended 31 August 2016 (2015 : Nil).
page 66
aamg annual report 2016 NOTES TO FINANCIAL STATEMENT cont’d
11 Earnings per Share
Basic earnings or loss per share amounts are calculated by dividing the profit or loss for the year attributable to equity
holders of the Company by the weighted average number of ordinary shares outstanding during the financial year.
Diluted earnings or loss per share amounts are calculated by dividing the profit or loss for the year attributable to equity
holders of the Company by the weighted average number of ordinary shares outstanding during the financial year plus
the weighted average number of ordinary shares that would be issued on the conversion of all the dilutive potential or-
dinary shares into ordinary shares.
The following table reflects the profit and loss and share data used in the computation of basic and diluted earnings per
share for the year ended 31 August:
(Loss)/profit for the year
Add: Non-controlling interest
(Loss)/profit after income tax attributable to the owners of
Asian American Medical Group Limited
Weighted average number of ordinary shares during the year
used in calculating basic EPS
Effect of dilution:
Share option
Consolidation Group
2016
S$
(2,062,338)
1,215
2015
S$
598,064
(39,354)
(2,061,123)
558,710
Number of
shares
Number of
shares
277,126,277
224,248,521
-
1,299,000
Weighted average number of ordinary shares during the year
used in calculating diluted EPS
277,126,277
225,547,521
Basic (loss)/earnings per share (S cents)
- continuing operations
- discontinued operations
Diluted (loss)/earnings per share (S cents)
- continuing operations
- discontinued operations
(0.74)
-
(0.74)
(0.74)
-
(0.74)
0.49
(0.22)
0.27
0.49
(0.22)
0.27
AAMG annual report 2016 | page 67
12 Cash and Cash Equivalents
Cash and bank balances
Fixed deposits
Cash and cash equivalents
Less: Fixed deposit pledged
Consolidation Group
2016
S$
2015
S$
4,579,031
4,582,504
6,728,874
1,666,862
11,307,905
6,249,366
-
(121,886)
Cash per consolidated statement of cash flows
11,307,905
6,127,480
The effective interest rate on short-term bank deposits was 0.68% - 2.75% (2015: 2.57% - 3.60%) per annum; these
deposits have a maturity of between 4 - 12 months (2015: 4 -12 months).
Fixed deposit amounting to S$121,886 was pledged last year to a bank for performance guarantee relating to the
operating lease.
13 Trade and Other Receivables
Current
Trade receivables
Less: Provision for doubtful debts
Trade receivables - net
Other receivables
Deposits
Consolidation Group
2016
S$
4,635,006
(224,087)
4,410,919
40,028
147,747
2015
S$
7,497,717
-
7,497,717
782,115
36,800
Total current trade and other receivables
4,598,694
8,316,632
page 68
aamg annual report 2016 NOTES TO FINANCIAL STATEMENT cont’d
a Provision for impairment of receivables
Included in the current year’s trade receivable is an amount of S$224,087 due from Rich Tree Land Pte Ltd (“RTL”)
which were billings by Asian American Medical Group Pte Ltd (“AAMG PL”) for work performed as the appointed
Project Lead Manager (“PLM”) for the Zhuhai Project. Following the termination of the PLM Agreement during the
year, RTL has disputed our billings and as a result, we have begun legal proceedings to recover this debt.
Apart from the above, current trade and term receivables are non-interest bearing loans and generally on 60
- 120 days terms. A provision for impairment is recognised when there is objective evidence that an individual
trade or term receivable is impaired. Apart from the abovementioned debt, no trade or other receivables are
considered past due or impaired. The Group reviews its trade receivables for evidence of impairment on a regular
basis. The trade receivable consists mainly amounts owning by the United Arab Emirates (“UAE”) government
agencies. Management holds regular meetings with the agencies relating to patient care feedback and collection
of amounts outstanding. Management is of the opinion that the trade receivables are recoverable and hence, no
further impairment is required.
b Credit risk
The group has no significant concentration of credit risk with respect to any single counter party or group of
counter parties.
The following table details the Group’s trade receivables exposed to credit risk with ageing analysis. Amounts
are considered as ‘past due’ when the debt has not been settled, with the terms and conditions agreed between
the Group and the customer or counter party to the transaction. Receivables that are past due are assessed for
impairment by ascertaining solvency of the debtors and are provided for where there are specific circumstances
indicating that the debt may not be fully repaid to the Group.
The balances of receivables that remain within initial trade terms are considered to be high credit quality.
Current
Due 1 - 30 days
Due 31- 60 days
Due over 60 days
14 Inventories
Consolidation Group
2016
S$
2015
S$
2,119,473
1,341,247
681,611
553,900
588,580
830,853
1,021,255
4,771,717
4,410,919
7,497,717
Consolidated Group
2016
S$
2015
S$
Medical Supplies at cost
190,728
163,668
AAMG annual report 2016 | page 69
15 Plant and Equipment
Office equipment
At Cost
Accumulated depreciation
Total office equipment
Medical equipment
At Cost
Accumulated depreciation
Total medical equipment
Computers
At Cost
Accumulated depreciation
Total computers
Furniture and fittings
At cost
Accumulated depreciation
Total furniture and fittings
Renovations
At cost
Accumulated depreciation
Total Renovations
Consolidated Group
2016
S$
9,534
(7,400)
2,134
2015
S$
12,114
(8,988)
3,126
338,929
338,929
(325,162)
(296,395)
13,767
42,534
167,425
172,183
(107,891)
(89,606)
59,534
82,577
15,311
14,111
(13,670)
(13,307)
1,641
804
240,856
(199,296)
41,560
240,856
(180,110)
60,746
Total plant and equipment
118,636
189,787
page 70
aamg annual report 2016 NOTES TO FINANCIAL STATEMENT cont’d
Movements in Carrying Amounts
Movement in the carrying amounts for each class of plant and equipment between the beginning and the end of the
current financial year.
Office
equipment
Medical
equipment
Computers
Furniture
and
fittings
Renovations
Total
S$
S$
S$
S$
S$
S$
Consolidated Group
Balance at 31 August 2015
3,126
42,534
Additions
Disposals
Write-offs
-
-
-
-
-
-
82,577
2,950
-
-
804
1,200
-
-
60,746
189,787
-
-
-
4,150
-
-
Depreciation expense
(992)
(28,767)
(25,993)
(363)
(19,186)
(75,301)
Carrying amount at
31 August 2016
2,134
13,767
59,534
1,641
41,560
118,636
Balance at 31 August 2014
4,539
136,528
81,212
Additions
Disposals
Write-offs – discontinued
operation
Depreciation expense
-
-
-
-
36,825
(21,948)
(4,909)
(10,891)
(441)
- continuing operations
(1,413)
(57,758)
(28,580)
- discontinued operations
-
(3,397)
(1,530)
-
818
-
-
(14)
-
246,070
468,349
23,639
61,282
-
(26,857)
(172,190)
(183,522)
(10,801)
(98,566)
(25,972)
(30,899)
Carrying amount at
31 August 2015
3,126
42,534
82,577
804
60,746
189,787
Included in medical equipment is equipment under finance lease arrangement amounting to S$Nil (2015: S$19,667).
Finance lease liabilities in the prior year were secured by the related assets held under finance leases
16 Intangible Assets
Total Intangible Assets
Goodwill
Consolidated Group
2016
S$
2015
S$
Cost and carrying value at the end of the years
266,123
266,123
AAMG annual report 2016 | page 71
Impairment test for goodwill
Goodwill is allocated to cash generating units (CGU’s) according to applicable business operations. There is no impairment
loss in the current period and prior year. In the current financial year, the liver segment incurred a loss. The Management
is of the view that the quantum of the loss for the current financial year is irregular and expects to see an improvement
in the next financial year which will in turn improve the segment’s profitability. The recoverable amount of a CGU is based
on value-in-use calculations. These calculations are based on projected cash flows approved by management covering a
period not exceeding five years. Management’s determination of cash flow projections and gross margins are based on
past performance and its expectation for the future. The present value of future cash flows has been calculated using a
discount rate of 10% (2015: 10%) and a growth rate of 5% - 10% (2015: 5%) per annum to determine value-in-use.
No impairment loss was required for the carrying value of goodwill as the recoverable amount was assessed to be in
excess of its carrying value. The directors believe that any reasonable change in the key assumptions will not materially
cause the recoverable value of the CGU to be lower than the carrying amount.
17 Trade and Other Payables
Current
Trade payables
Patients’ deposits
Provision for employee benefits
Sundry payables and accrued expenses
Total current trade and other payables
Consolidated Group
2016
S$
2015
S$
3,938,457
5,767,363
57,462
188,560
345,221
202,087
149,085
577,443
4,529,700
6,695,978
The provision for employee benefits relates to the provision for cash bonus to employees for the period from January to
August 2016 (2015: January to August 2015) and is payable by December 2016 (2015: December 2015).
18 Taxation
Current assets
Income tax refundable
Current liabilities
Income tax payable
Non-current
Consolidated Group
2016
S$
2015
S$
8,334
-
-
13,159
Defered tax assets
S$
S$
S$
Tax allowance relating to unabsorbed losses
Net deferred tax asset
-
-
150,000
150,000
150,000
150,000
1 September 2015
Recognised in
profit or loss
31 August 2016
page 72
aamg annual report 2016
19 Issued Capital
Opening share balance
Shares issued during the year
Share issue expenses
Share option exercised
Total capital
a. Ordinary Shares
At the beginning of reporting year
Shares issued during year
Share options exercised
At reporting date
NOTES TO FINANCIAL STATEMENT cont’d
Consolidated Group
2016
S$
2015
S$
7,458,090
4,267,495
5,722,880
3,203,261
(363,772)
(12,666)
115,340
-
12,932,538
7,458,090
Consolidated Group
2016
2015
Number of
shares
Number of
shares
239,453,754
209,453,754
57,000,000
30,000,000
1,299,000
-
297,752,754
239,453,754
Ordinary shares participate in dividends and the proceeds on winding up of the parent entity in proportion to the number
of shares held. The fully paid ordinary shares have no par value and the Company does not have a limited amount of
authorised capital.
At the shareholders’ meetings each ordinary share is entitled to one vote when a poll is called, otherwise each shareholder
has one vote on a show of hands.
Following the approval received from Shareholders at the Annual General Meeting held on 3 December 2015, the Company
issued a total of 57,000,000 new ordinary shares at A$0.10 per share for A$5,700,000 which were fully paid in January
2016. In addition, 1,299,000 new ordinary shares were issued in January 2016 under the Group’s Incentive Option Scheme.
In March 2015, the Company issued a total of 30,000,000 new ordinary at A$0.10 per share for A$3,000,000 at exchange
rate of A$1: S$1.064) which were fully paid.
b. Capital Management
Management controls the capital of the Group in order to provide shareholders with adequate returns and ensure that the
Group can fund its operations and continue as a going concern. Currently the Group has no debt.
There are no externally imposed capital requirements.
There have been no changes in the strategy adopted by management to control the capital during the year.
AAMG annual report 2016 | page 73
20 Reserves
a.
(i)
Nature and purpose of reserve
Share-based payments
The share-based payments reserve is used to recognise:
•
•
•
At grant date of the fair value of options issued to employees but not exercised
At grant date the fair value of shares issued to employees
The issue of shares held by the AAMG Employee Share Trust to employees
(ii) Foreign currency translation
Exchange difference arising on translation of the foreign controlled entity are recognised in other comprehensive income as
described in note 2(k) and accumulated in a separate reserve within equity. The cumulative amount is reclassified to profit or
loss when the net investment is disposed of.
b.
Movements in reserves
(i)
Employee share option reserve
Beginning of financial year
Employee share option exercised (Note 21)
End of financial year
(ii)
Foreign currency translation reserve
Beginning of financial year
Net currency translation difference of financial statements of foreign
subsidiaries
End of financial year
Total as at the end of financial year
21 Share-Based Employee Remuneration
Consolidated Group
2016
S$
2015
S$
72,179
(72,179)
-
72,179
-
72,179
(595,513)
106,006
220,956
(701,519)
(374,557)
(595,513)
(374,557)
(523,334)
i. On 23 November 2009, the shareholders of AAMG approved the establishment of the AAMG Employee Share
Option Plan and the rules that govern the operation of the Plan. Minor amendments to the Rules have been
approved by shareholders at the Annual General Meeting since. The options are granted under the Plan for no
consideration and hold no voting or dividend rights and are not transferable. On 17 January 2011, 1,299,000 share
options were granted to certain KMP under the Plan to take up ordinary shares at an exercise price of A$0.088
each. The options were exercised in full on 15 January 2016.
ii. Options granted to KMP are as follows:
Grant Date
17 January 2011
Number
1,299,000
These options vest over a 3-year period and are subject to service conditions such that only a third of the options
granted may be exercised on or after the first, second and third anniversary of the grant. Options expire at the
earlier of termination of employment or five years after the grant date. Further details of these options are pro-
vided in the Directors’ report. The options lapse when a KMP ceases their employment with the Group. During
the financial year, no options were vested with key management personnel (2015: Nil).
page 74
aamg annual report 2016 NOTES TO FINANCIAL STATEMENT cont’d
iii. The Company established the AAMG Employee Share Option Plan as a long-term incentive scheme to recognise
talent and motivate executives to strive for Group performance. Employees are granted options which vest over
3 years, subject to meeting specified service criteria. The options are issued for no consideration and carry no
entitlements to voting rights or dividends of the Group but have been listed. The number available to be granted
is determined by the Nomination and Remuneration Committee and is based on performance measures includ-
ing growth in shareholder return, return on equity, cash earnings, and group EPS growth.
Options are forfeited 30 days after the holder ceases to be employed by the Group, unless the Board determines
otherwise (this is usually only in the case of retirement, redundancy, death or disablement).
The options are issued with an exercise price determined by the Nomination and Remuneration Committee to
be either:
(a) a price equal to the Market Price or such higher price as may be determined by the Committee in its
absolute discretion; or
(b) a price which is set at a discount to the Market Price, the quantum of such discount to be determined by the
Committee in its absolute discretion, provided that the maximum discount which may be given in respect
of any Option shall not exceed twenty (20) per cent of the Market Price in respect of the that Option.
The Market Price is defined as the weighted average closing sale price of the shares recorded on the Australian
Securities Exchange (“ASX”) over the last 5 trading days on which sales of the shares were recorded preceding
the day on which the Committee resolves to invite the application for an Option.
A summary of the movements of all Company options issues is as follows:
Options outstanding as at 31 August 2015
1,299,000
A$0.088
Number of
shares
Weighted average
exercise price
Granted
Forfeited
Exercised
Expired
Options outstanding as at 31 August 2016
Options exercisable as at 31 August 2016:
-
-
-
-
1,299,000
A$0.088
-
-
-
-
-
-
Options exercisable as at 31 August 2015:
1,299,000
A$0.088
There were no options outstanding at year end.
The fair values of options granted were determined using a variation of the binomial option pricing model that takes
into account factors specific to the share incentive plans, such as the vesting period. The total shareholder return per-
formance condition related to the Scheme, being a market condition, has been incorporated into the measurement by
means of actuarial modelling. The following principal assumptions were used in the valuation:
Grant date
Vesting period ends
Share price at date of grant
Volatility
Option life
Dividend yield
Risk free investment rate
Fair value at grant date
Exercise price at date of grant
Exercisable from/to
17 January 2011
17 January 2014
A$0.12
69%
5 years
5.830%
2.875%
A$0.04
A$0.088
17 January 2012- 17 January 2016
Historical volatility has been the basis for determining expected share price volatility as it is assumed that this is
indicative of future movements. The life of the options is based on the historical exercise patterns, which may not
eventuate in the future.
AAMG annual report 2016 | page 75
22 Controlled Entities
a. Controlled entities consolidated
Name
Country of
incorporation
Principle
activities
Asian American Medical Group Limited
Australia
Investment
holding
Subsidiary of Asian American Medical Group Limited:
Percentage owned (%)
2016
100
2015
100
Asian American Medical Group Inc.
British Virgin
Islands
Investment
holding
100
100
Subsidiary of Asian American Medical Group Inc.
Asian American Liver Centre Pte. Ltd.
Singapore
Asian American Radiation Oncology Pte. Ltd.
(formerly known as Asian American Blood &
Marrow Transplant Centre Pte. Ltd.)
Singapore
Asian American Medical Group Pte. Ltd.
Singapore
Million Health Ventures Pte. Ltd.
Singapore
Associate of Asian American Liver Centre Pte. Ltd.:
Liver specialist
clinic
Radiation
oncology
services
Management
and
consultancy
Investment
Holding
100
70
100
100
PT. Asian Liver Center Indonesia
Indonesia
Dormant
50
100
70
100
-
50
b. Acquisition of controlled entities
Asian American Medical Group Inc., a subsidiary of Asian American Medical Group Ltd, on 29 July 2016, incorporated a
fully-owned subsidiary called Million Health Ventures Pte Ltd, a limited liability company in Singapore with an intended
liability of operating as an investment holding company.
c. Disposal of controlled entity
On 20 April 2015, AARO increase its paid-up share capital from S$1 to S$500,000 by issuing 499,999 new shares. As a
result of this capital enlargement, 150,000 or 30% of those shares in the enlarged share capital was issued to non-con-
trolling interest which diluted Asian American Medical Group Inc.’s shareholding in AARO from 100% to 70%. The fair
value of the 30% was agreed by all parties to be S$150,000.
There were no disposals during the financial year.
page 76
aamg annual report 2016
NOTES TO FINANCIAL STATEMENT cont’d
23 Commitments
Consolidated Group
2016
S$
2015
S$
a. Operating leases
Non-cancellable operating leases contracted for but not capitalised in the financial statements:
Payable – minimum lease payments
Not longer than 1 year
Longer than 1 year but not longer than 5 years
489,902
448,018
937,920
19,201
-
19,201
The leases for the Group’s office premises at Gleneagles Hospital will expire in June 2018 and February 2019.
b. Finance leases
There is no outstanding finance lease balance at balance date.
c. Capital Commitments
Capital expenditures contracted for at the reporting date but not recognised in the financial statements amounting
to S$28,000 (US$20,000) is in respect of investment of 20% shares in a joint venture company in Myanmar. The
Myanmar joint venture company is in the process of incorporation subsequent to year end and upon completion of the
incorporation, the investment commitment will be payable. . However, the liver clinic has commenced operations during
the year but is temporarily operating on a different revenue sharing model until the joint venture company is set up.
There is no other capital commitment as at reporting date.
AAMG annual report 2016 | page 77
24 Cash Flow Information
Reconciliation of cash flow from operations with (loss)/profit after income tax
Consolidated Group
2016
S$
2015
S$
(Loss)/profit after income tax
(2,061,123)
558,710
Adjustment for:
Depreciation
- continuing operations
- discontinued operations
Provision for doubtful debts
Foreign exchange gain/(loss) - net
Finance income
Finance cost
Loss from disposal of fixed assets
Write down of inventory
Write down of capital assets
Changes in assets and liabilities:
Decrease/(increase) in trade and other receivables
(Increase)/decrease in inventories
(Decrease)/increase in trade and other payables
75,301
-
224,087
98,566
30,899
-
44,870
(166,569)
(79,019)
(78,775)
-
-
-
-
396
9,998
108,515
183,522
3,583,475
(6,505,040)
(27,061)
131,458
(2,158,896)
3,715,716
(Decrease)/increase in deferred and current tax liabilities
(171,493)
30,159
Net cash used in operating activities
(569,859)
(1,882,445)
25 Events After the Balance Date
No other matters or circumstances have arisen since the end of the financial year which significantly affected or may
significantly affect the operations of the Group, the results of those operations, or the state of affairs of the Group in
future financial years.
26 Related Party
The Group’s related parties include its associates and joint venture, KMP and post-employment benefit plans for the
Group’s employees.
Balances and transactions between the Company and its subsidiaries, which are related to the Company and set out in
note 22, have been eliminated on consolidation and are not disclosed in this note.
Disclosures relating to KMP are set out in note 7 and in the remuneration report.
Other related party transaction
Related corporation:
Consultancy fee
2016
S$
2015
S$
15,000
-
The related corporation is a company in which one of the directors, Ms Pamela Anne Jenkins is a director and shareholder.
Other than the above, there are no related party transaction or balances incurred in the current financial year (2015: Nil).
page 78
aamg annual report 2016 NOTES TO FINANCIAL STATEMENT cont’d
27
Operating Segments
AASB 8 requires operating segments to be identified on the basis of internal reports about components of the Consol-
idated Group that are regularly reviewed by the chief operating decision maker, the Board of Directors (chief operating
decision makers), in order to allocate resources to the segment and to assess its performance. The Consolidated Group
has identified its operating segments to be as follows based on distinct operational activities:
(i) Provision of medical consultation and services in the hepatology and related fields (liver segment); and
(ii) Provision of medical consultation and services in the radiation oncology and related fields (radiation oncology
segment);
(iii) Provision of healthcare management and consultancy services (management and consultancy segment); and
(iv) Provision of medical consultation and services in the haematology and related fields (blood & bone marrow
segment) which ceased last financial year and was classified as “discontinued operations”.
This is the basis on which internal reports are provided to the Board of Directors for assessing performance and deter-
mining the allocation of resources within the Consolidated Group. Unless stated otherwise, all amounts reported to the
Board of Directors, being the chief decision maker with respect to operating segments, are determined in accordance
with accounting policies that are consistent to those adopted in the annual financial statements of the group.
The current Consolidated Group operates primarily in three businesses, namely the provision of medical consultation and
services in the hepatology, radiation oncology and healthcare management and its related field advisory.
Details of the performance of each of these operating segments for the financial years ended 31 August 2016 and 31
August 2015 are set out below:
(i) Segment Performance
Liver
S$
Radiation
Oncology
Management &
Consultancy
Blood & Bone
Marrow
S$
S$
S$
Total
S$
31 August 2016
External sales revenue
15,640,633
1,060,819
381,393
Inter segment sales
-
6,884
-
Total segment revenue
15,640,633
1,067,703
381,393
Inter-segment eliminations
Total Group revenue
Segment net (loss)/profit
before tax
Other expenses
Income tax benefit
Total Group net loss after tax
(1,011,359)
4,051
(709,290)
-
-
-
-
17,082,845
6,884
17,089,729
(6,884)
17,082,845
(1,716,598)
(494,525)
150,000
(2,061,123)
AAMG annual report 2016 | page 79
Liver
S$
Radiation
Oncology
Management &
Consultancy
Blood & Bone
Marrow
S$
S$
S$
Total
S$
31 August 2015
External sales revenue
19,489,705
Inter segment sales
1,020
Total segment revenue
19,490,725
33,063
9,083
42,146
831,336
512,201
20,866,305
-
-
10,103
831,336
512,201
20,876,408
Less: Revenue from discontinued operations
Inter-segment eliminations
Total Group revenue
(512,201)
(10,103)
20,354,104
Segment net profit/(loss)
before tax
Other expenses
Income tax expense
Total Group net profit after tax
(ii) Segment assets
1,277,442
(131,181)
271,602
(491,140)
926,723
(354,854)
(13,159)
558,710
Liver
S$
Radiation
Oncology
Management &
Consultancy
S$
S$
Others
S$
Total
S$
31 August 2016
Segment assets
5,986,052
579,796
6,045,209
10,758,360
23,369,417
Reconciliation of segment assets to Group assets:
Inter-segment eliminations
Unallocated assets intangible
Total Group assets
Segment asset increases in the year
(6,995,120)
266,123
16,640,420
Capital expenditure
2,950
1,200
-
-
4,150
Liver
S$
Radiation
Oncology
Management &
Consultancy
S$
S$
Others
S$
Total
S$
31 August 2015
Segment assets
9,229,081
520,816
867,671
5,385,139
16,002,707
Reconciliation of segment assets to Group assets:
Inter-segment eliminations
Unallocated assets intangible
Total Group assets
Segment asset increases in the year
(1,083,254)
266,123
15,185,576
Capital expenditure
52,302
7,259
1,721
-
61,282
page 80
aamg annual report 2016 NOTES TO FINANCIAL STATEMENT cont’d
(iii) Segment liabilities
31 August 2016
Liver
S$
Radiation
Oncology
Management &
Consultancy
S$
S$
Others
S$
Total
S$
Segment liabilities
(3,964,150)
(136,108)
(6,356,287)
(1,061,670)
(11,518,215)
Reconciliation of segment liabilities to Group liabilities:
Inter-segment eliminations
Total Group liabilities
6,988,515
(4,529,700)
Liver
S$
Radiation
Oncology
Management &
Consultancy
S$
S$
Others
S$
Total
S$
31 August 2015
Segment liabilities
(6,345,821)
(81,179)
(527,792)
(866,333)
(7,821,125)
Reconciliation of segment liabilities to Group liabilities:
Inter-segment eliminations
Total Group liabilities
(iv) Revenue by geographical location
1,111,988
(6,709,137)
Revenue attributable to external customers is disclosed below, based on the location of where the revenue was derived:
Singapore
Asia (ex-Singapore)
Others
Total revenue
(v) Assets by geographical location
Assets by geographical location:
Australia
Singapore
Total assets
(vi) Major Customers
Consolidated Group
2016
S$
2015
S$
16,525,263
19,534,765
426,825
130,757
796,261
23,078
17,082,845
20,354,104
Consolidated Group
2016
S$
2015
S$
4,131,154
12,509,266
16,640,420
4,761,889
10,423,687
15,185,576
The Group is not reliant on any one major customer to whom it provides its products or services.
AAMG annual report 2016 | page 81
28 Financial risk management policies
The Group’s financial instruments consist mainly of cash at bank and accounts receivable and payable.
The totals for each category of financial instruments, measured in accordance with AASB 139 as detailed in the accounting
policies to the financial statements, are as follows.
Financial assets
Cash and cash equivalents
Trade and other receivables
Total financial assets
Financial liabilities
Trade and other payables
Total financial liabilities
Consolidated Group
2016
S$
2015
S$
11,307,905
6,249,366
4,598,694
8,316,632
15,906,599
14,565,998
(4,529,700)
(6,695,978)
(4,529,700)
(6,695,978)
page 82
aamg annual report 2016 NOTES TO FINANCIAL STATEMENT cont’d
Financial risk management policies
The Board is responsible for monitoring and managing financial risk exposures of the Group.
Specific financial risk exposures and management
The main risk the Group is exposed to include foreign exchange risk, credit risk, liquidity risk and treasury management risk.
(a)
Foreign exchange risk
Exposure to foreign exchange risk may result in the fair value or future cash flows of a financial instrument
fluctuating due to movement in foreign exchange rates of currencies in which the Group holds financial instruments
which are other than the functional currency of the Group which is the Singapore dollar.
(i) Risk management
The Group’s transactions are predominantly in it functional currency which is the Singapore dollar. The
amount of asset and liability held in foreign currency is not considered material to the Group and hence does
not hedge these asset or liability.
(ii) Sensitivity analysis
Foreign exchange risk
A sensitivity analysis of the impact of foreign exchange risk is not shown as it is not considered material to
the Group at the reporting date.
(b)
Credit risk exposures
Credit risk represents the loss that would be recognised if counterparties failed to perform as contracted.
The credit risk on financial assets of the entity which have been recognised in the statement of financial position,
is the carrying amount, net of any allowance for credit losses.
Credit risk is managed through the maintenance of procedures which ensure to the extent possible, that customers
and counterparties to transactions are of sound credit worthiness. Such monitoring is used in assessing receivables
for impairment.
Apart from the allowance for credit losses as disclosed in note 13, no other receivables are considered past due
or impaired.
(c)
Liquidity risk
Liquidity risk arises from the possibility that the Group might encounter difficulty in settling its debts or otherwise
meeting its obligations related to financial liabilities.
All financial assets and liabilities as disclosed above have maturities within one year for the 31 August 2016
financial year.
The Group manages liquidity risk by monitoring forecast cash flows.
(d)
Treasury risk management
The Board meets on a regular basis to analyse financial risk exposure and evaluate treasury management strategies
in the context of the most recent economic conditions and forecasts. The Board’s overall risk management strategy
seeks to assist the Consolidated Group in meeting its financial targets, whilst maintaining the effects on financial
performance. Risk is also minimised through investing surplus funds in financial institutions that maintain a high
credit rating or in entities that the Board has otherwise cleared as being financially sound.
(e)
Fair values of financial assets and liabilities
Fair value represents the price that would be received to sell an asset or paid to transfer a liability in an ordinary
transaction between market participants at the measurement date.
The carrying values of financial instruments approximate their fair values.
AAMG annual report 2016 | page 83
29 Parent Company Information
Parent entity
Assets
Current assets
Non-current assets
Total assets
Liabilities
Current liabilities
Total liabilities
Total net assets
Equity
Issued capital
Retained earnings
Employee share option reserve
Foreign currency revaluation reserve
Total equity
Financial performance
(Loss)/profit for the year
Other comprehensive income
Total comprehensive loss
2016
S$
2015
S$
10,758,347
5,385,127
1,390,826
2,803,557
12,149,173
8,188,684
(38,453)
(38,453)
(25,882)
(25,882)
12,110,720
8,162,802
26,019,305
20,544,857
(13,475,546)
(11,806,633)
-
72,180
(433,039)
(647,602)
12,110,720
8,162,802
(1,741,093)
355,634
214,564
(662,080)
(1,526,529)
(306,446)
Included in the loss for the year is a S$1,412,731 write down (2015: S$1,649,528 write back) of investment in subsidiary to
the net asset of the Group and does not have an impact on the Group’s consolidated results for the current or prior year.
The parent entity has no contingent liabilities, contractual commitments or guarantees in relation to its subsidiary entities.
page 84
aamg annual report 2016 NOTES TO FINANCIAL STATEMENT cont’d
30 Company Details
The registered office of the Company is:
25 Peel Street
Adelaide SA 5000
The principal place of business is:
Asian American Medical Group
6A Napier Road,
Gleneagles Hospital Annexe Block #02-37,
Singapore 258500
Singapore centres:
Asian American Liver Centre Pte Ltd
6A Napier Road,
Gleneagles Hospital Annexe Block #02-37,
Singapore 258500
Asian American Radiation Oncology Pte Ltd
6A Napier Road,
Gleneagles Hospital Annexe Block #02-37,
Singapore 258500
Asian American Medical Group Pte Ltd
6A Napier Road,
Gleneagles Hospital Annexe Block #02-37,
Singapore 258500
Malaysia centre:
iHEAL Medical Centre
Level 7 & 8, Annexe Block, Menara IGB,
Mid Valley City, Lingkaran Syed Putra,
59200 Kuala Lumpur,
Malaysia
AAMG annual report 2016 | page 85
Directors’ Declaration
The directors of Company declare that:
(a)
the financial statements and notes, as set out on pages 39 to 85, are in accordance with the Corporations Act 2001,
including
(i) giving a true and fair view of the financial position as at 31 August 2016 and of the performance for the year ended
on that date of the Consolidated Group; and
(ii) complying with Accounting Standards.
(b)
the Executive Director and Group Chief Financial Officer have declared that:
(i) the financial records of the Company for the financial year have been properly maintained in accordance with
s286 of the Corporations Act 2001;
(ii) the financial statements and notes for the financial year comply with the Accounting Standards; and
(iii) the financial statements and notes for the financial year give a true and fair view.
(c)
In the Directors’ opinion, there are reasonable grounds to believe that the Company will be able to pay its debts as
and when they become due and payable.
(d) complying with International Financial Reporting Standards as disclosed in Note 2 to the financial statements;
This declaration is made in accordance with a resolution of the Board of Directors.
Dato’ Dr Kai Chah Tan
Director
3 November 2016
page 86
aamg annual report 2016
Level 1,
67 Greenhill Rd
Wayville SA 5034
Level 1,
Correspondence to:
67 Greenhill Rd
GPO Box 1270
Wayville SA 5034
Adelaide SA 5001
Correspondence to:
T 61 8 8372 6666
GPO Box 1270
F 61 8 8372 6677
Adelaide SA 5001
E info.sa@au.gt.com
W www.grantthornton.com.au
T 61 8 8372 6666
F 61 8 8372 6677
E info.sa@au.gt.com
W www.grantthornton.com.au
INDEPENDENT AUDITOR’S REPORT
TO THE MEMBERS OF ASIAN AMERICAN MEDICAL GROUP LIMITED
INDEPENDENT AUDITOR’S REPORT
Report on the Financial Report
TO THE MEMBERS OF ASIAN AMERICAN MEDICAL GROUP LIMITED
We have audited the accompanying financial report of Asian American Medical Group
Limited (the Company), which comprises the consolidated statement of financial position as
Report on the Financial Report
at 31 August 2016, the consolidated statement of profit or loss and other comprehensive
We have audited the accompanying financial report of Asian American Medical Group
income, consolidated statement of changes in equity and consolidated statement of cash
Limited (the Company), which comprises the consolidated statement of financial position as
flows for the year then ended, notes comprising a summary of significant accounting
at 31 August 2016, the consolidated statement of profit or loss and other comprehensive
policies and other explanatory information and the directors’ declaration of the consolidated
income, consolidated statement of changes in equity and consolidated statement of cash
entity comprising the Company and the entities it controlled at the year’s end or from time
flows for the year then ended, notes comprising a summary of significant accounting
to time during the financial year.
policies and other explanatory information and the directors’ declaration of the consolidated
entity comprising the Company and the entities it controlled at the year’s end or from time
Directors’ Responsibility for the Financial Report
to time during the financial year.
The Directors of the Company are responsible for the preparation of the financial report
that gives a true and fair view in accordance with Australian Accounting Standards and the
Directors’ Responsibility for the Financial Report
Corporations Act 2001. The Directors’ responsibility also includes such internal control as the
The Directors of the Company are responsible for the preparation of the financial report
Directors determine is necessary to enable the preparation of the financial report that gives a
that gives a true and fair view in accordance with Australian Accounting Standards and the
true and fair view and is free from material misstatement, whether due to fraud or error.
Corporations Act 2001. The Directors’ responsibility also includes such internal control as the
The Directors also state, in the notes to the financial report, in accordance with Accounting
Directors determine is necessary to enable the preparation of the financial report that gives a
Standard AASB 101 Presentation of Financial Statements, the financial statements comply with
true and fair view and is free from material misstatement, whether due to fraud or error.
International Financial Reporting Standards.
The Directors also state, in the notes to the financial report, in accordance with Accounting
Standard AASB 101 Presentation of Financial Statements, the financial statements comply with
Auditor’s Responsibility
International Financial Reporting Standards.
Our responsibility is to express an opinion on the financial report based on our audit. We
conducted our audit in accordance with Australian Auditing Standards. Those standards
Auditor’s Responsibility
require us to comply with relevant ethical requirements relating to audit engagements and
Our responsibility is to express an opinion on the financial report based on our audit. We
plan and perform the audit to obtain reasonable assurance whether the financial report is
conducted our audit in accordance with Australian Auditing Standards. Those standards
free from material misstatement.
require us to comply with relevant ethical requirements relating to audit engagements and
plan and perform the audit to obtain reasonable assurance whether the financial report is
free from material misstatement.
Grant Thornton Audit Pty Ltd ACN 130 913 594
a subsidiary or related entity of Grant Thornton Australia Ltd ABN 41 127 556 389
‘Grant Thornton’ refers to the brand under which the Grant Thornton member firms provide assurance, tax and advisory services to their clients and/or refers to one or more member firms, as the
Grant Thornton Audit Pty Ltd ACN 130 913 594
context requires. Grant Thornton Australia Ltd is a member firm of Grant Thornton International Ltd (GTIL). GTIL and the member firms are not a worldwide partnership. GTIL and each member firm
a subsidiary or related entity of Grant Thornton Australia Ltd ABN 41 127 556 389
is a separate legal entity. Services are delivered by the member firms. GTIL does not provide services to clients. GTIL and its member firms are not agents of, and do not obligate one another and
are not liable for one another’s acts or omissions. In the Australian context only, the use of the term ‘Grant Thornton’ may refer to Grant Thornton Australia Limited ABN 41 127 556 389 and its
Australian subsidiaries and related entities. GTIL is not an Australian related entity to Grant Thornton Australia Limited.
‘Grant Thornton’ refers to the brand under which the Grant Thornton member firms provide assurance, tax and advisory services to their clients and/or refers to one or more member firms, as the
context requires. Grant Thornton Australia Ltd is a member firm of Grant Thornton International Ltd (GTIL). GTIL and the member firms are not a worldwide partnership. GTIL and each member firm
Liability limited by a scheme approved under Professional Standards Legislation. Liability is limited in those States where a current
is a separate legal entity. Services are delivered by the member firms. GTIL does not provide services to clients. GTIL and its member firms are not agents of, and do not obligate one another and
are not liable for one another’s acts or omissions. In the Australian context only, the use of the term ‘Grant Thornton’ may refer to Grant Thornton Australia Limited ABN 41 127 556 389 and its
scheme applies.
Australian subsidiaries and related entities. GTIL is not an Australian related entity to Grant Thornton Australia Limited.
Liability limited by a scheme approved under Professional Standards Legislation. Liability is limited in those States where a current
scheme applies.
AAMG annual report 2016 | page 87
An audit involves performing procedures to obtain audit evidence about the amounts and
disclosures in the financial report. The procedures selected depend on the auditor’s
judgement, including the assessment of the risks of material misstatement of the financial
report, whether due to fraud or error.
In making those risk assessments, the auditor considers internal control relevant to the
Company’s preparation of the financial report that gives 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 Company’s internal control. An audit
also includes evaluating the appropriateness of accounting policies used and the
reasonableness of accounting estimates made by the Directors, as well as evaluating the
overall presentation of the financial report.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide
a basis for our audit opinion.
Independence
In conducting our audit, we have complied with the independence requirements of the
Corporations Act 2001.
Auditor’s Opinion
In our opinion:
a
the financial report of Asian American Medical Group Limited is in accordance with the
Corporations Act 2001, including:
i
ii
giving a true and fair view of the consolidated entity’s financial position as at
31 August 2016 and of its performance for the year ended on that date; and
complying with Australian Accounting Standards and the Corporations Regulations
2001; and
b
the financial report also complies with International Financial Reporting Standards as
disclosed in the notes to the financial statements.
Report on the Remuneration Report
We have audited the Remuneration Report included the directors’ report for the year ended
31 August 2016. The Directors of the Company are responsible for the preparation and
presentation of the Remuneration Report in accordance with section 300A of the
Corporations Act 2001. Our responsibility is to express an opinion on the Remuneration
Report, based on our audit conducted in accordance with Australian Auditing Standards.
page 88
Auditor’s Opinion on the Remuneration Report
In our opinion, the Remuneration Report of Asian American Medical Group Limited for
the year ended 31 August 2016, complies with section 300A of the Corporations Act 2001.
GRANT THORNTON AUDIT PTY LTD
Chartered Accountants
Sheenagh Edwards
Partner - Audit & Assurance
Adelaide, 3 November 2016
AAMG annual report 2016 | page 89
Shareholder Information
The shareholder information set out below was applicable as at 24 October 2016.
A. Distribution of holders of equity securities
Ordinary Shares
Employee Options
1
1,001
5,001
10,001
-
-
-
-
1,000
5,000
10,000
100,000
100,001 and over
153
56
50
64
44
367
-
-
-
-
-
-
There were 203 holders of less than marketable parcel of ordinary shares.
The percentage of the total holdings of the twenty largest holders of ordinary shares was 97.52 per cent.
page 90
aamg annual report 2016
B. Equity security holders
The names of the twenty largest holders of quoted equity securities are listed below:
Name
Number held
Percentage
Ordinary shares
Citicorp Nominees Pty Limited
HSBC Custody Nominees (Australia) Limited
Mr Kong Meng Ang
Ms Pamela Anne Jenkins
Russing Med Holdings Pte Ltd
Mr Chin Soon Ong
Ms Tye Wee Thin
Aspire Strategy Pte Ltd
Mr Khai Ping Wun
Dr Kang Hoe Lee
J P Morgan Nominees Australia Limited
Unusual Investment & Trading Pte Ltd
Mr Robert John Wood & Mrs Stella Agnes Wood
(Bob & Stella Wood S/F A/C)
Dr Huat Seong Saw
Mr Hiroshi Tatara
Mr Cherinjit Kumar Shori
Mrs Anjana Nandha
Mr Ravindran Govindan
BNP Paribas Noms Pty Ltd (DRP)
Mr Harry Vui Khiun Lee
139,827,455
44,085,567
34,000,000
21,324,600
21,000,000
5,000,000
5,000,000
4,000,000
3,000,000
2,500,040
2,050,001
2,000,000
1,140,415
1,000,000
1,000,000
842,000
700,000
699,483
642,891
561,915
49.96
14.81
11.42
7.16
7.05
1.68
1.68
1.34
1.01
0.84
0.69
0.67
0.38
0.34
0.34
0.28
0.24
0.23
0.22
0.19
AAMG annual report 2016 | page 91
SHAREHOLDER INFORMATION cont’d
C. Substantial holders
Substantial holders in the company are set out below:
Citicorp Nominees Pty Limited
HSBC Custody Nominees (Australia) Limited
Mr Kong Meng Ang
Ms Pamela Anne Jenkins
Russing Med Holdings Pte Ltd
D. Voting rights
Please refer note 19.
E. On-market buy back
There are no current on-market buy back.
Number held
Percentage
139,827,455
44,085,567
34,000,000
21,324,600
21,000,000
46.96
14.81
11.42
7.16
7.05
page 92
aamg annual report 2016 Dedicated to healing
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