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CONTENTS

20

22

Management Structure

34

Board of Directors and Management team

46

Securities and Shareholder Information

48

Policy and Business Overview

48

Vision, Mission and Long Term Goal

48

Major Changes and Developments

50

Shareholding Structure of the Company Group

52

Revenue Structure and Business Description

82

85

87

89

154

154

156

188

Message from Chairman and Group Chief Executive Officer

Risk Factors

Management Discussion and Analysis

24

Financial Highlights

Report on the Board of Directors' Responsibility towards the Financial Statements

Report of Independent Auditor and Financial Statement

Sub-committee Report

Risk Management Committee Report

Report of the Nomination and Remuneration Committee

158

Report of the Corporate Governance and Ethics Committee

159

Corporate Governance

Internal Control and Risk Management

189

Connected Transactions

200

212

214

214

215

220

Audit Committee Report

General Information

Companies in which Grammy holds more than 10%

157

Corporate Social Responsibilities

Details of the Head of Internal Audit and Head of Compliance

Other Reference Persons

Please see more of the Company's information from the Annual Registration Statement (Form 56-1) as presented in the www.sec.or.th. or the Company's website

General Information and Other Significant Information


20

ANNUAL REPORT 2013

GMM GRAMMY

Mr. Paiboon Damrongchaitham Chairman of the Board of Directors

Ms. Boosba Daorueng Group Chief Executive Officer

‌As one of the leading and largest local content providers, with long-standing experiences, GMM Grammy is confident that our DTT channels will be channels of creativity and quality, and successful. They will be among favorite channels in the mind of viewers nationwide, and can reach viewers in all TV platforms. This will help generate and sustain good returns for shareholders in the long run‌


21

Message from the Chairman and the Group Chief Executive Officer Dear Shareholders, GMM Grammy Public Company Limited made an important step towards its goal of becoming fully-integrated entertainment business in late 2013 when it won the auction for 2 licenses for the use frequencies for Digital Terrestrial Television (“DTT”), arranged by the National Broadcasting and Telecommunications Commission (“NBTC”). The licenses allowed GMM Grammy to operate 2 DTT channels, namely Variety-HD channel (No. 31), and Variety-SD channel (No. 25). As one of the leading and largest local content providers, with long-standing experiences, GMM Grammy is conųdent that our DTT channels will be channels of creativity and quality, and successful. They will be among favorite channels in the mind of viewers nationwide, and can reach viewers in all TV platforms. This will help generate and sustain good returns for shareholders in the long run. Moreover, the Group is committed to pushing GMM Z satellite television platform to become the market leader as it is the most complete platform to watch free-to-air and free-to-box satellite channels, GMM Z Pay TV, as well as DTT channels, which will commence broadcasting in 2014. To date, GMM Grammy has expanded the GMM Z platform with 2.4 million set-top boxes sold in a short period of time, a very satisfactory growth rate. GMM Z satellite television platform will help enhance the Group’s potentials to gain a signiųcant share of revenue in the advertising market. In 2013, the Group produced a number of outstanding contents, such as the movie “Pee Mak…Phra Khanong”, fetching up to Baht 1,000 million in box-ofųce revenue nationwide, the largest box-ofųce revenue in Thai movie history, TV series “Hormones…”, well received by both viewers and advertising agencies with over 80 million views on YouTube and the highest advertising rate for satellite TV programs, and the most popular song of the year “Khor Jai Ther Laek Ber Tho” of Ying Lee, a great success in terms of revenue and polls by various institutions giving her the title “Female Singer of 2013”. With willingness, dedication and adherence to the principle of ethics and transparency, GMM Grammy’s management and operations in 2013 were evaluated “Excellent” (5 stars) on corporate governance by the Thai Institute of Directors (IOD) for three consecutive years, evaluated “Very Good” on shareholders’ meeting quality by the Thai Investors Association, and ranked among the top 50 Thai listed companies with highest corporate governance scores by ASEAN CG Scorecard Country Reports and Assessment 2012 - 2013, with participation of listed companies from six ASEAN countries, namely, Indonesia, Malaysia, the Philippines, Singapore, Vietnam and Thailand. It was a pilot project of ASEAN CG Scorecard for further implementation in ASEAN countries. Not only having been operating its business under the framework of good corporate governance, GMM Grammy always values the importance of good quality of life and livable society. Consequently, with social activities being part of GMM Grammy’s key missions, it has carried out projects for community and society continuously, such as the song “Phra Racha Phu Song Tham” (The Virtuous King) under a project to create contemporary moral songs in honor of His Majesty the King on the occasion of his Birth Anniversary on December 5, 2013, with Byrd-Thongchai McIntyre being the vocalist; To-Be-Number-One Project; “Thai Chuai Thai” Project of Support to Friends in Need (of “Pa”) Volunteers Foundation, the Thai Red Cross Society; Participation in the Blood Donation Project of the Thai Red Cross Society every year from 2008, etc. All the achievements were the results of support from all parties concerned, including shareholders, customers, business partners, ųnancial institutions, government agencies, advertising agencies, artists, the management and all employees. On behalf of the Board of Directors, I would like to thank all of you for your continued trust and support to GMM Grammy Public Company Limited. We are committed and dedicated to the creation of quality work for happiness and smiles on everyone, in all forms. We have developed appropriate strategies to suit the changing situation and technologies, while the potential of our personnel will help push the Company forward in order to sustain growth and generate adequate returns for all shareholders.

Mr. Paiboon Damrongchaitham Chairman of the Board of Directors

Ms. Boosba Daorueng Group Chief Executive Officer


22

ANNUAL REPORT 2013

GMM GRAMMY

Securities and Shareholder Information


23

Securities and Shareholder Information 1. The Company’s Security As of December 31, 2013, the Company has Authorized capital of 636,317,936 baht, (the Company increased capital on September 11, 2013), consisting of 636,317,936 common shares with a par value of Baht 1 each. The Company paid-up capital is 636,317,936 baht.

2. Major Shareholders 2.1 Top shareholders according to the share registration on November 14, 2013 are : Rank

1. 2. 3. 4. 5. 6. 7. 8. 9. 10.

Shareholders

Mr. Paiboon Damrongchaitham* Mr. Taweechat Chulangkoon Mr. Natthaphon Chulangkoon CREDIT SUISSE AG, SINGAPORE BRANCH Geurt Fah Co.,Ltd. Mr. Takonkiet Viravan Thailand Securities Depository Co.,Ltd. for Depositors Mrs. Hatairat Chulangkoon Thai NVDR Company Limited GIC PRIVATE LIMITED-C Total

Number of Shares

% Holding

374,951,363 113,296,022 38,532,785 25,052,520 12,952,114 6,930,840 3,504,000 2,412,584 2,361,217 2,138,400 582,131,845

58.925% 17.805% 6.056% 3.937% 2.035% 1.089% 0.551% 0.379% 0.371% 0.336% 91.48%

* Mr. Paiboon Damrongchaitham Group consists of Mr. Paiboon Damrongchaitham, holding 374,951,363 shares (equivalent to 58.925%) and Geurt Fah Co., Ltd., holding 12,952,114 shares, (equivalent to 2.035%)

The free Ŵoat of minority shareholders on March 18, 2013 (the last day of the registration book referred to by the Company for reporting the "Distribution of Ordinary Shares Report Form" to the SET) amounted to 2,595 shareholders, equivalent to 19.75% of the Company's paid-up capital. Distribution of Shareholders by Nationality The distribution of shareholders according to their nationality, as of the latest book registration closing date on November 14, 2013, is as follows : Grand Total Shareholders

Thai Shareholders Foreign shareholders Total

Number of Shareholders

2,627 33 2,660

Number of Shares

602,343,727 33,974,209 636,317,936

Corporations %

94.66 5.34 100

Number of Shareholders

12 21 33

Number of Shares

19,141,731 33,936,109 53,077,840

Individuals %

3.01 5.33 8.34

Number of Shareholders

2,615 12 2,627

Number of Shares

583,201,996 38,100 583,240,096

%

91.65 0.01 91.66

2.2 The major shareholder that has a signiųcant inŴuence on the management policies or the operation of the Company is Paiboon Damrongchaitham Group.

3. Dividend Policy The Company and its afųliates have a policy of paying dividends to shareholders at a rate not less than 40% of the net proųt after corporate income tax and regulatory reserve each year, based upon the Company ųnancial statements, subject to the economic conditions and future operations.


24

ANNUAL REPORT 2013

GMM GRAMMY

Management

The Company’s management structure as of December 31, 2013 comprises Board of Directors and other 5 sub-committees appointed by the Board of Directors comprising (1) Audit Committee, (2) Nomination and Remuneration Committee, (3) Risk Management Committee, and (4) Corporate Governance and Ethics Committee. Moreover, the Board of Directors was also appointed Group Executive Committee of which the structure comprising of top executives by positions, as shown by the above organization chart.

Board of Directors As of December 31, 2013, the Board of Directors consisted of 11 distinguished directors, 7 members were from management team, and 4 members were independent directors who were non-management (equivalent to 1/3 of the total number of directors). Head of the Ofųce of Corporate Secretary serves as the Company Secretary. Each year, 1/3 of total numbers of directors due to retire by rotation (according to the Company’s Articles of Association). In 2013, the Board of Directors held 4 ordinary meetings and 6 extraordinary meetings, or 10 meetings in total over the past year.


25

Names of the Company’s directors, terms of the positions and their meeting attendance throughout the year are shown below : Name

1. Mr. Paiboon Damrongchaitham 2. Dr. Naris Chaiyasoot\1 3. Mr. Dej Bulsuk 4. Mr. Weerawong Chittmittrapap 5. Ms. Suvabha Charoenying 6. Ms. Boosaba Daorueng 7. Mrs. Saithip Montrikul na Audhaya 8. Mr. Krij Thomas 9. Mr. Kriengkarn Kanchanapokin 10. Mr. Sataporn Panichraksapong 11. Ms. Suwimon Chungjotikapisit Miss Patchararat Patcharaput Mr. Chai Nasylvanta Mr. Takonkiet Viravan

Title

Director/ Chairman Independent Director Independent Director Independent Director Independent Director Director / Vice-Chairman Director Director Director Director Director Company Secretary Independent Director Director

Term

Apr 2011 - 2014 Annual General Meeting (AGM) Apr 2013 - 2016 AGM Apr 2013 - 2016 AGM Apr 2013 - 2016 AGM Apr 2012 - 2015 AGM Apr 2013 - 2016 AGM Apr 2012 - 2015 AGM Apr 2011 - 2014 AGM Apr 2011 - 2014 AGM Apr 2011 - 2014 AGM Apr 2012 - 2015 AGM Ended Feb 28, 2013 Ended Oct 14, 2013

Meeting Attendance (times)

No. of years for Directorship

9/10 8/8 10/10 10/10 10/10 10/10 8/10 10/10 10/10 10/10 10/10 10/10 1/1 3/8

19 9 months 11 7 3 19 11 5 4 4 3 13 years 10 months 4 years 5 months

Note: Additional information and changes during the year 2013 \1 Dr. Naris Chaiyasoot was appointed the Company’s director, according to the resolution passed at the Board of Directors’ Meeting No.2/2013 held on March 20, 2013 effective on March 20, 2013 to replace the resigned director, Mr. Chai Nasylvanta. (He was re-appointed as the director at the AGM held on April 26, 2013). \2 Mr. Chai Nasylvanta resigned from the Company’s director, effective on March 1, 2013. \3 Mr. Takonkiet Viravan resigned from the Company’s director, effective on October 15, 2013.

For each of the Board of Directors’ Meeting, the Company Secretary was responsible to send out the meeting notice including all agendas to the directors 7 days prior to the meeting date. All matters discussed in the meetings had been duly recorded in detail and minutes of the meetings were adopted by the Board of Directors in readiness for inspection by any directors and related parties. Directors with signing authority on behalf of the Company Ms. Boosaba Daorueng or Ms. Suwimon Chungjotikapisit has to co-sign with one of the following Directors: Mrs. Saithip Montrikul Na Audhaya or Mr. Krij Thomas or Mr. Kreingkarn Kanchanapokin, or Mr. Sataporn Panichraksapong, on the document with a Company’s seal. Duties and Responsibilities of the Board of Directors The Board of Directors is accountable to shareholders and also plays an important role in supervision of Management Team to operate the business according to the Company’s objective and Articles of Association, related laws, and resolution of the Shareholders’ Meeting, as well as to performs their duties in good faith, with due diligence and care and fairly treatment, for the best interest of the Company and all shareholders. Those of which could be summarized as follows : 1. To perform all duties using their knowledge, abilities and experience for the best beneųt of the Company in accordance with the law, the Company’s objectives and Articles of Association, Corporate Governance and Business Ethics Handbook, and resolution of the Shareholders’ Meeting with honesty, integrity and prudence, to protect the Company’s interests. 2. To set the corporate vision, mission and Corporate Governance and Business Ethics Handbook, and to approve strategies, policies, business plans and budgets, and to supervise the management to make sure that they follow the established policies effectively and efųciently to increase economic value of the Company and maximize shareholders’ wealth. 3. To clearly delineate and set forth the duties, responsibilities and authority of the Board of Directors, Sub-committees, and management team as speciųed in the Company’s Corporate Authorization Index (CAI). 4. To approve or give consent to submit signiųcant transactions to the Shareholders Meeting for approval such as new investments, acquiring or disposing assets, in accordance with the SEC and SET rules and regulations, and the Company’s Corporate Authorization Index.


26

ANNUAL REPORT 2013

GMM GRAMMY

5. To approve or give consent to submit to the Shareholders Meeting for approval any connected transactions and transactions which may lead to potential conŴicts of interest of the Company and subsidiaries, so as to be in compliance with the SEC and SET rules and regulations, and the Company’s Corporate Authorization Index. 6. To ensure that the Company has reliable accounting systems, ųnancial reports, and accounting audits. 7. To ensure that the Company has sufųcient and effective internal controls and risk management systems, monitored by an internal audit department that collaborates with the Audit Committee on signiųcant risks. 8. To be honest and loyal, and to possess integrity and ethics in running the business; having a genuine interest in the Company and focusing on sustainable business operation. 9. To constantly aware of responsibility to shareholders, and operate the business in the interest of shareholders, and transparently disclose accurate and complete information to investors under high standard. 10. To be responsible for the management team’s performance and operations by ensuring that the team is well dedicated and cautious in operating the business. 11. To be responsible for ųnancial reports by preparing a report of the Board of Directors’ ųnancial accountability in the annual report, together with the auditor’s report. According to the Corporate Authorization Index, the Board of Directors has the authority to approve the following matters : 1. Policy and business operations of the Group. 2. Determination of the Corporate Authorization Index with exception to the matters which require the shareholders’ approval such as, capital increase, capital decrease, debenture issuing. 3. Deųning the organizational structure of the Chief Executive Ofųcer’s business line. 4. Approval of annual budget and manpower of the Group. 5. Giving consent on the Board of Directors’ remuneration (being proposed by the Nomination and Remuneration Committee and before proceeding to shareholders for approval). 6. Employment, appointment, transfer and dismissal of the Chief Executive Ofųcer. 7. Unbudgeted training and seminars, both in-house and offsite. 8. Investment in new projects or new company, such as investment in subsidiaries under the control of the Company or afųliated companies (Holding at least 20 - 50 %) or joint ventures, investment to expand the current project worth from 100 million baht, which beyond the authority of the Group Executive Committee where its authority is limited to not exceeding 100 million baht per year. 9. New budget or new project on production of new program, or any project which is not included in the annual budget. 10. Transfer of copyright. 11. Unbudgeted ųxed assets procurement. 12. Unbudgeted ųxed assets repair. 13. Amortization of ųxed assets by destroying or donating which beyond the authority of the Group Executive Committee where its authority is limited to not exceeding 50 million baht per year. 14. Unbudgeted expenses. 15. Rules for the connected transactions with general commercial term and condition. Roles and Responsibilities of the Chairman Roles and Responsibilities towards the Company To establish holistic and long term stability for the company and its subsidiary companies within the frame of corporate’s vision and mission statement by encouraging good ethics for business operation and management such that it follows principles of internationally accepted Good Corporate Governance. Roles and Responsibilities towards the Board of Directors To direct and oversee the Board of Directors, ensuring that it has the appropriate structure and qualiųcations to operate in a fashion that yields maximum beneųt for shareholders and all involved parties, and in addition, to promote and ensure that the Board of Directors takes its part and responsibilities with dedication, honesty and integrity whilst prioritizing the Company’s beneųts.


27

Roles and Responsibilities towards the Executives To encourage the executives to operate and manage the business with transparency and utmost efųcacy, as well as smoothly, within bounds of the law and regulatory agencies so as to achieve the Company’s business plan goals and objectives, along with promoting continuous advancement of skills and expertise of the executives. Roles and Responsibilities towards Employees, Shareholders and Stakeholders To strengthen employees, shareholders and stakeholders’ conųdence and trust in the Company by stressing ethical business operation and consideration for all involved parties, community and environment.

Group Executive Committee The Board of Directors at the meeting no. 3/2013 held on March 28, 2013 resolved to restructure the Group Executive Committee of which the structure comprising of top executives by the following positions (1) Group Chief Executive Ofųcer (2) Chief Executive Ofųcer-Music Business (3) Chief Executive Ofųcer-Media Business (4) Chief Executive Ofųcer-Satellite TV Business (5) Chief Executive Ofųcer-Digital TV Business (6) Chief Finance Ofųcer (7) Chief Investment Ofųcer and (8) Chief Administrative Ofųcer. Miss Patchararat Patcharaput was appointed Secretary to the Group Executive Committee. As of December 31, 2013, the Group Executive Committee comprised 6 members who were knowledgeable and experienced in various business lines and met a total of 13 times. The names and meeting attendance of each member in 2013 were noted as follows : Name

1. 2. 3. 4. 5. 6.

Ms. Boosaba Daorueng Mrs. Saithip Montrikul Na Audhaya Mr. Krij Thomas Mr. Kanchit Kawachart\1 Mr. Premon Pinskul Mrs. Jiraporn Rungsrithong Mr. Thana Tienachariya\2 Ms. Patchararat Patcharaput

Title

Chairman Member Member Member Member Member Member Secretary

Meeting Attendance (times)

12/13 13/13 12/13 8/9 11/13 13/13 0/1 13/13

Note: Additional information and changes during the year 2013 \1 Mr. Kanchit was appointed as Chief Executive Ofųcer-Digital TV Business by the Group Executive Committee Meeting No.4/2013, effective on March 25, 2013. \2 Mr. Thana Tienachariya resigned from the Company, effective on February 1, 2013.

For each of the Group Executive Committee Meeting, Secretary of the Group Executive Committee was responsible to send out the meeting notice including all agendas to the committee members 7 days prior to the meeting date. All matters discussed in the meetings had been duly recorded in detail and minutes of the meetings were endorsed by the Executive Committee in readiness for inspection by any committee members and related parties. Roles and Responsibilities of the Group Executive Committee 1. Setting and preparation of the Company’s business strategies, policies, business plans and budgets to the Board of Directors for approval. 2. Performing through decision making, instruction relay and assignment execution determined by the Board of Directors, in accordance with the Company’s Authorization and Procedure Manual as being approved by the Board of Directors. 3. Operating and managing business according to the policies and directions issued by the Board of Directors. 4. Monitoring of the management under supervision of the Group Chief Executive Ofųcer, and carry out duties as determined by the Board of Directors. 5. Being responsible for other assignments periodically delegated by the Board of Directors. 6. Carrying out the Shareholders’ and the Board of Directors’ resolutions, abiding by laws with honesty and integrity for the beneųts of the Company, and in accordance with related laws, and the Company’s objectives and Articles of Association. The above duties and responsibilities do not give the Group Executive Committee the authority to approve transactions in which they or any related persons that may have any potential conŴicts of interest (as deųned by the SEC or SET) with the Company or subsidiaries. All transactions must comply with SET announcement regarding related matters.


28

ANNUAL REPORT 2013

GMM GRAMMY

Management Team (‘Management’ as defined by the SEC and SET) As of December 31, 2013, the Company’s management team (‘Management’ in this instance refers to the top four most senior members of the management team ranked below the Group Chief Executive Ofųcer or Group CEO, irrespective of their positions, including the position equivalent to the fourth rank and senior management in the Accounts and Finance Departments, or the position equivalent to the Chief Finance Ofųcer or CFO), comprised 7 qualiųed members as follows : Name

1. 2. 3. 4. 5. 6. 7.

Mr. Paiboon Damrongchaitham\1 Ms. Boosaba Daorueng Mrs. Saithip Montrikul Na Audhaya Mr. Krit Thomas Mr. Kanchit Kawachart\2 Mr. Premon Pinskul Mrs. Jiraporn Rungsrithong Mr. Thana Tienachariya\3

Title

Chairman of the Company Advisory Board Group Chief Executive Ofųcer Chief Executive Ofųcer-Media Business Chief Executive Ofųcer-Music Business, Acting Chief Executive Ofųcer-Satellite TV Business Chief Executive Ofųcer-Digital TV Business Chief Financial Ofųcer Chief Investment Ofųcer, Acting Chief Administrative Ofųcer Chief Executive Ofųcer-Broadcasting Business

Note: Additional information and changes during the year 2013 \1 Mr. Paiboon Damrongchaitham was appointed Chairman of the Company Advisory Board, according to the resolution passed at the Board of Directors Meeting No. 3/2008 held on July 31, 2008. The roles and responsibilities of this position will be to focus on determining strategies, providing advice, and selecting staff in three areas, namely business operations, investments management, and corporate administrative issues under a management framework where the Advisory Chairman is to report directly to the Board of Directors. Moreover, Mr. Paiboon is not considered a member of the Management Team, as deųned by the SEC, but is able to access to the Company’s information and polocies setting. \2 Mr. Kanchit Kawachart was appointed as the above mentioned position by the Group Executive Committee Meeting No. 4/2013, effective on March 25, 2013. \3 Mr. Thana Tienarchariya resigned from the Company, effective on February 1, 2013

Roles, Responsibilities, and Operational Authority of Group Chief Executive Ofųcer (Group CEO) Group Chief Executive Ofųcer (Group CEO) has the authority and responsibilities to manage the Company and all the companies in the Group in strict adherence to plans or budgets approved by the Board of Directors. The Group CEO is expected to perform the roles with loyalty, integrity, prudence, while maintaining the interests of the Company and all stakeholders. The Grop CEO’s scope of authority extends to various matters or businesses as follows : 1. Implementing vision and mission of the Company and its subsidiaries through speciųc strategies to achieve maximum beneųt. 2. Managing the business of the GRAMMY Group under appropriate cooperation and mutual support in music business, media business, satellite TV business, and related business lines. 3. Managing and supervising overall business operation of the Company according to purposes, policies, rules, regulations, Article of Association, Corporate Governance and Business Ethics Handbook, and Authorization and Procedure Manual of the GRAMMY Group by reporting to the Board of Directors regularly. 4. Setting policy on personnel management and supporting operations in all departments for sustainable development with full potential. 5. Providing advice, recommendation, or working experience, guidelines for business strategies to the management team and employees for the best beneųt of the GRAMMY Group. 6. Being responsible for effective ųnancial and budgetary management. 7. Performing other duties as assigned by the Board of Directors, and/or Shareholders Meeting, according to the purposes, Articles of Association of the Company, and related laws. The authority of the Group CEO as outlined above shall be in compliance with the business lines under control and cannot be wielded in circumstances where the Group CEO has any conŴicts of interest or vested interest in any way with the Company or its subsidiaries, unless it has been approved at a Board of Directors Meeting in the presence of Independent Directors.


29

Changes to GRAMMY Shares Held by Directors and Management The Company reports on changes in GRAMMY’s shareholding status of all directors and the Management at the Board of Directors Meeting quarterly, summarizing shares held by the Board of Directors, members of the Group Executive Committee, and Management Team (as deųned by the SEC). These ųgures include the number of shares held by related parties, according to Section 59 and 258 of the Securities and Exchange Act. As of December 31, 2013, the ųgures of individual shares holding (directly and indirectly) compared to 2012, were as follows :

No.

1 2 3 4 5 6 7 8 9 10 11 12 13 14

Director/Executive

Mr. Paiboon Damrongchaitham Spouse/Immature Children Related Juristic Person Mrs. Boosaba Daorueng Spouse/Immature Children Related Juristic Person Dr. Naris Chaiyasoot Spouse/Immature Children Related Juristic Person Mr. Dej Bulsuk Spouse/Immature Children Related Juristic Person Mr. Weerawong Chittmittrapap Spouse/Immature Children Related Juristic Person Ms. Suvabha Charoenying Spouse/Immature Children Related Juristic Person Mrs. Saithip Montrikul Na Audhaya Spouse/Immature Children Related Juristic Person Mr. Krij Thomas Spouse/Immature Children Related Juristic Person Ms. Suwimon Chungjotikapisit Spouse/Immature Children Related Juristic Person Mr. Kreingkarn Kanjanapokin Spouse/Immature Children Related Juristic Person Mr. Sataporn Panichraksapong Spouse/Immature Children Related Juristic Person Mr. Kanchit Kawachart Spouse/Immature Children Related Juristic Person Mr. Premon Pinskul Spouse/Immature Children Related Juristic Person Mrs. Jiraporn Rungsrithong

Position

Number of Shares Holding As of December 2012

Chairman Vice Chairman Independent Director Independent Director Independent Director Independent Director Director Director Director Director Director Chief Executive Ofųcer Chief Financial Ofųcer Chief Investment Ofųcer Acting Chief Administrative Ofųcer

Spouse/Immature Children Related Juristic Person * Paid-up shares of the Company as of December 31, 2012 = 530,264,947 shares ** Paid-up shares of the Company as of December 31, 2013 = 636,317,936 shares

Percentage (%) *

Number of Shares Holding As of December 2013

Percentage (%) **

Number of Shares Change Increase/ (Decrease) During 2013

289,201,630 9,894,800 1,000,100 500,100 N/A N/A N/A 100 1,327,200 1,764,000 N/A N/A N/A 5,000

54.54 1.87 0.19 0.09 N/A N/A N/A 0.00 0.25 0.33 N/A N/A N/A 0.00

374,951,363 12,841,114 1,150,120 600,120 120 1,593,600 2,127,898 13,200

58.93 2.00 0.18 0.09 0.00 0.25 0.33 0.00

85,749,733 2,946,314 150,020 100,020 20 266,400 363,898 8,200

-

-

-

-

-


30

ANNUAL REPORT 2013

GMM GRAMMY

Company Secretary The Board of Directors Meeting No. 4/2012 held on June 22, 2012, resolved to appoint Miss Patchararat Patcharaput, Head of Ofųce of Corporate Secretary, as the Company Secretary, effective as of June 22, 2012. This person is considered well qualiųed with great capabilities, possesses many years of useful experience, successfully participated in training seminars and related courses required, and being able to carry out the duties of the Company Secretary so that the Company adheres to related laws and Good Corporate Governance regulations. Duties and Responsibilities of the Company Secretary 1. Being a Secretary to the Board of Directors by coordinating with all parties in organizing Board of Directors Meetings and Shareholders Meetings so that they adhere to principles of Good Corporate Governance and related regulations, the Company’s Articles of Associations and best practices, and related laws such as the Securities and Exchange Act and the Public Limited Company Act B.E. 2535. 2. Being responsible for disclosing the Company’s information in line with the SET’s and SEC’s regulations, and other regulatory bodies. 3. Providing basic advice to the Board of Directors and Management who have to follow the Company’s Articles of Association, rules of the SEC and SET, and any new regulations that may be relevant to the Company. 4. Preparing and storing important documents such as the registration of the Company’s directors, the invitation letter and minutes of the Board of Directors Meeting, the invitation letter and minutes of the Shareholders Meeting, the Annual Report, shares holding report of directors and management team, and reports of conŴicts of interest ųled by directors and the management. 5. Supervising various activities and events performed by the Board of Directors to ensure the efųciency and effectiveness of their works, and the greatest beneųts to the Company. 6. Coordinating with related parties to ensure that the resolutions from the Board of Directors Meetings and the Shareholders Meetings are carried out. 7. Executing additional duties as assigned by the Board of Directors.

Remuneration of Directors and Management 1. Directors and Audit Committee Members Monetary remuneration for members of the Board of Directors was an annual gratuity, which would be paid in term of meeting allowance. The rest amount would be paid varied with the meeting attendance in each year. Allocating remuneration to the Board of Directors then depends upon each individual attendance at the Board of Directors Meetings. In addition, the Chairman of the Nomination and Remuneration Committee will allocate these funds (within the budget approved by the Annual General Meeting of Shareholders). Remuneration for 13 directors of the Board, including 5 members of the Audit Committee in 2013, was amounting to 6,650,000 baht in total, with details as follows : Name

Title

1. Mr. Paiboon Damrongchaitham Chairman Independent Director / 2. Mr. Chai Nasylvanta\1 Chairman of Audit Committee Independent Director / 3. Dr. Naris Chaiyasoot\2 Chairman of Audit Committee 4. Mr. Dej Bulsuk Independent Director / Member of Audit Committee 5. Mr. Weerawong Chittmittrapap Independent Director / Member of Audit Committee 6. Ms. Suvabha Charoenying Independent Director / Member of Audit Committee 7. Ms. Boosaba Daorueng Director

Director's Meeting Allowance in 2013 (Baht)

Director's Annual Gratuity in 2013 (Baht)

Remuneration for Total Remuneration the Audit Committee in 2013 2013 (Baht/Year) (Baht)

117,000 13,000

792,152 44,008

33,334

909,152 90,342

104,000

352,068

166,666

622,734

130,000

440,085

150,000

720,085

130,000

440,085

150,000

720,085

130,000

440,085

150,000

720,085

30,000

440,085

-

470,085


31

Name

Title

8. Ms. Suwimon Chungjotikapisit 9. Mrs. Saithip Montrikul Na Audhaya 10. Mr. Krij Thomas 11. Mr. Takonkiet Viravan\3 12. Mr. Kreingkarn Kanjanapokin 13. Mr. Sataporn Panichraksapong Total Amount

Director Meeting Allowance in 2013 (Baht)

Director Annual Gratuity in 2013 (Baht)

Remuneration for Total Remuneration the Audit Committee in 2013 2013 (Baht/Year) (Baht)

Director Director

30,000 24,000

440,085 352,068

-

470,085 376,068

Director Director Director Director

30,000 9,000 30,000 30,000 807,000

440,085 132,024 440,085 440,085 5,193,000

650,000

470,085 141,024 470,085 470,085 6,650,000

Note : \1 Mr. Chai Nasylvanta resigned from the Company’s director, effective on March 1, 2013. \2 Dr. Naris Chaiyasoot was appointed the Company’s director, according to the resolution passed at the Board of Directors’ Meeting No.2/2013 held on March 20, 2013 effective on March 20, 2013 to replace the resigned director, Mr. Chai Nasylvanta. \3 Mr. Takonkiet Viravan resigned from the Company’s director, effective on October 15, 2013.

2. Group Executive Committee Member and Management Team Monetary remuneration for the Group Executive Committee and Management Team (‘Management’ in this instance refers the SEC and SET’s deųnition including Group Chief Executive Ofųcer or Group CEO, the top four most senior members of the management team ranked below the Group CEO irrespective of their positions, including the position equivalent to the fourth rank and Chief Finance Ofųcer) is in the form of salary, bonus and other beneųts such as company cars, car allowances in lieu of company cars, mobile phones usage fee, medical payments, and life insurance premium. In 2013, the total monetary remuneration for 7 member of the management team (including those for the resigned member; Mr. Thana Tienachariya but excluding Chairman of Advisory Board) amounted to 70,029,686 baht. Remuneration Description

Amount (Baht)

Salary and Bonus Other Remuneration : - Provident Fund (Depend on the period of employment) - Others Total

66,271,749 1,556,400 2,201,537 70,029,686

Human Resources GRAMMY Group’s total numbers of workforce, both full-time and part-time employees (with a deųnite contract term), as of December 31, 2013 were 5,073. Unit : Person 2013 Company

GMM Grammy Plc. Subsidiaries Total

Full-time

Part-time

Total

1,132 2,452 3,584

978 511 1,489

2,110 2,963 5,073

Note : Full-time employees are employees whose employment contracts do not indicate the date of their employment termination. : Part-time employees are employees whose employment contracts clearly indicate the date when their employment with the Company ends, such as contractual employees and freelancers.


32

ANNUAL REPORT 2013

GMM GRAMMY

The GRAMMY Group places great importance on human resources as they are key drivers of the Company’s optimum operational efųciency and effectiveness, as well as achievement of targets and success guided by the Company’s vision. Therefore, the Board of Directors has established a Human Resources Management Policy, as follows: 1. The Company regards each employee as a respected and honored colleague who should be well cared for. 2. The Company will ensure fair employment and offer fair career advancement opportunities. 3. The Company will operate under the basis of teamwork, where everyone works together as a single unit, and will work to build excellent morale among employees at every level. 4. The Company will develop all employees in terms of their knowledge, ability, expertise, operational and management skills as appropriate so that they can continue to advance and grow. 5. The Company will promote and retain all talented employees to ensure they work with the Company as long as possible. 6. The Company will promote and support employees to ensure stability in their profession, with promotions being granted to employees who have suitable quality before seeking to recruit externally sourced candidates to ųll the positions. 7. The Company will review beneųts and other remuneration to remain on par with other companies in the same industry and commensurate with the position, experience, qualiųcations and quality of each employee. The pay will also be based on the Company’s performance, as well as the country’s socio-economic environment. 8. The Company considers that human resources management is a duty to be directly handled by immediate supervisor, and that the human resources department serves as a consulting unit. Therefore, it is the supervisor’s responsibility to closely monitor and ensure the well-being of their staff. The Company has publicized the Company Employment Regulations and Welfare Handbook through the GRAMMY Group’s Intranet so that all employees can study, understand, and use as a reference. The Company constantly revises and updates the content so that it remains appropriate for the Company’s business operations, based on fairness and/or changes in rules, regulations, and laws of concerned authorities. Signiųcant changes in the number of employees in the past 3 years - NoneMajor labor disputes in the past 3 years - NoneEmployee Remuneration and Beneųts Among one of the missions that the Board of Directors has highlighted, “promote employees’ job satisfaction and skill and better quality of life,” human capital is the Company’s most valuable asset. Therefore, the Board of Directors has prescribed a set of policies and guidelines on employee remuneration and beneųts, as follows : 1. Salary and bonus The GRAMMY Group’s policy in remunerating its employees is on the basis of reasonableness, fairness, knowledge, capability, performance, and compatibility with the industry’s average pay scale, as well as growth of the business and the Company. 2. Other beneųts For the provident fund which is a post-retirement beneųt, the percentage of employees’ and employer’s contribution rate is equivalent. The rate of contribution is dependent upon the period of employment, namely: • Less than 5 years, contribution rate of 3% • 5 years or more, contribution rate of 5% In 2013, total salaries, bonuses, and employer’s contributions paid for the entire Group were amounting to 1,944.29 million baht, details are as follows :


33

Unit: Million Baht 2013 Company

GMM Grammy Plc. Subsidiaries Total

Salaries

Bonuses

Employer’s contributions

Total

581.55 1,107.27 1,688.82

81.20 128.43 209.63

18.54 27.30 45.84

681.29 1,263.00 1,944.29

3. Employee Welfare Improving the quality of work life requires more than offering various beneųts for staff according to the law. Therefore, the Company has adjusted and increased its welfare and fringe beneųt offering to better match the Company’s businesses. Some of these beneųts are, for example, healthcare payments (in-patients, out-patients, dental and eye care), in-house medical care, group life and accident insurance and annual check-up for employees, and other types of ųnancial and non-ųnancial assistance (such as funds for funeral arrangements of employees, their parents, children or legal spouse, monk ordinations, preparing reliable sources providing loan with special interest rate for house purchasing, special discount for some company’s activities. These measures are aimed to provide moral support and enhance conųdence in working with the Company. Moreover, these beneųts help to alleviate employees’ ųnancial burdens and provide some stability for employees and their families, taking into account the maximum beneųts to employees. Therefore, the Company has documented these measures into a Welfare Handbook. Moreover, the Employee Self Service (ESS) system was developed to allow employees to easily and promptly view information about themselves such as personal information, employment terms, income, education, work experience, information about their parents, children and spouse, tax deductible, salary slips, and summary of their annual income. Employees are allowed to make changes to information pertaining to themselves and tax deduction at all times, while data security is adequately and properly in place. In 2013, the Company reviewed and ensured that the Human Resources Management Policies, Company Employment Regulations, and Welfare Handbook were fully and constantly complied with.


34

ANNUAL REPORT 2013

GMM GRAMMY

Board of Directors and Management Team Board of Directors

as of December 31, 2013

1. Mr. Paiboon Damrongchaitham

2. Ms. Boosaba Daorueng

3. Dr. Naris Chaiyasoot

4. Mr. Dej Bulsuk

5. Mr. Weerawong Chittmittrapap

6. Ms. Suvabha Charoenying

Chairman of the Board

Independent Director

Vice Chairman

Independent Director

Independent Director

Independent Director


35

7. Mrs. Saithip Montrikul Na Audhaya

8. Mr. Krij Thomas

10. Mr. Sataporn Panichraksapong

11. Ms. Suwimon Chungjotikapisit

Director

Director

Director

Director

9. Mr. Kreingkarn Kanjanapokin Director


36

ANNUAL REPORT 2013

GMM GRAMMY

Management Team (Group Executive Committee) as of December 31, 2013

1. Ms. Boosaba Daorueng

2. Mrs. Saithip Montrikul Na Audhaya

3. Mr. Krij Thomas

4. Mr. Kanchit Kawachart

5. Mr. Premon Pinskul

6. Mrs. Jiraporn Rungsrithong

Chairman of Group Executive Committee

Member

Member

Member

Member

Member


37

Board of Directors and Management Team Mr. Paiboon Damrongchaitham (64 years)

Ms. Boosaba Daorueng (61 years)

Chairman of the Company Advisory Board, Chairman of the Board, Member of the Nomination and Remuneration Committee Education Background • Bachelor of Arts (Mass Communications) (Honors), Chulalongkorn University • Doctoral of Business Administration (Honorary), Christian University Seminar Accomplishment The National Broadcasting and Telecommunications Commission • Broadcasting Executive Forum (BCF), Class 1/2013 Number of Share Holding (%) as of 31/12/2013 374,951,363 shares (58.93%), including related parties, according to Section 59 of the Securities and Exchange Act Experience GMM Grammy Plc. Jul 2011 - Present Member of the Nomination and Remuneration Committee 2008 - Present Chairman of the Company Advisory Board 1998 - Present Chairman of the Board 2005 - Jul 2011 Chairman of the Nomination and Remuneration Committee 1998 - Jul 2008 Advisor to the Executive Committee Other Listed Companies -NoneOther Companies 2009 - Present Vice Chairman, Family Know-how Co., Ltd. 2008 - Present Chairman of the Company Advisor, GMM Media Plc. 2007 - Jul 2008 Advisor to the Executive Committee, GMM Media Plc. 2005 - Feb 2009 Chairman of the Nomination and Remuneration Committee, GMM Media Plc. 2005 - Oct 2007 Chairman of the Risk Management Committee, GMM Media Plc. 2002 - Feb 2009 Chairman of the Board, GMM Media Plc. 2002 - Apr 2007 Chief Executive Ofųcer, GMM Media Plc. 2005 - Oct 2006 (Acting) Managing Director, Sanamluang Gandontree Co.,Ltd. 1983 - 1998 Managing Director, Grammy Entertainment Plc.

Vice Chairman, Chairman of the Risk Management Committee, Chairman of the Group Executive Committee, Group Chief Executive Ofųcer Education Background • Bachelor of Liberal Arts, Thammasat University Number of Share Holding (%) as of 31/12/2013 1,750,240 shares (0.27%), including related parties, according to Section 59 of the Securities and Exchange Act Experience GMM Grammy Plc. May 2012 - Present Chairman of the Group Executive Committee Feb 2012 - Present Group Chief Executive Ofųcer (Group CEO) 2008 - Present Vice Chairman 2005 - Present Chairman of the Risk Management Committee 1994 - Present Director 2009 - May 2012 Co-Chief Executive Director 2009 - Feb 2012 Co-Chief Executive Ofųcer 2002 - Feb 2009 Chief Executive Director, Chief Executive Ofųcer 2001 - Oct 2002 Chief Creative Ofųcer - (Creative Division) Other Listed Companies -NoneOther Companies Sep 2013 - Present GMM HD Digital TV Co.,Ltd. Sep 2013 - Present GMM SD Digital TV Co.,Ltd. Oct 2010 - Present Director, GR Vocal Studio Co., Ltd May 2010 - Present Director, Acts Studio Co., Ltd. 2008 - Present Advisor, GMM Media Plc. Jul 2005 - Present Director, Index Creative Village Plc. Apr 2004 - Present Director, Scenario Co.,Ltd. 2003 - 2008 Advisor to the Board of Directors / Advisor to the Executive Committee, GMM Media Plc.


38

ANNUAL REPORT 2013

GMM GRAMMY

Dr. Naris Chaiyasoot (58 years)

Mr. Dej Bulsuk (63 years)

Chairman of the Audit Committee, Independent Director, Member of the Nomination and Remuneration Committee Education Background • B.A. Economics (Honors), Thammasat University • M.A. Economics, Thammasat University • Ph.D Economics, University of Hawaii, USA Seminar Accomplishment The Thai Institute of Directors (IOD) • Director Accreditation Program (DAP), Class 32/2005 • Finance for Non-Finance Directors (FND), Class 19/2005 • Director Certiųcation Program (DCP), Class 82/2006 • Chartered Director Class (CDC), Class 3/2008 Number of Share Holding (%) as of 31/12/2013 -NoneExperience GMM Grammy Plc. Mar 2013 - Present Chairman of the Audit Committee Independent Director, Member of the Nomination and Remuneration Committee Other Listed Companies Dec 2012 - Present Chairman of the Audit Committee, Fortune Parts Industry Plc. 2009 - 2012 Director, Thai Oil Plc. 2008 - 2011 Director, PTT Plc. Other Companies 2011 - Present Director-General, The Treasury Department, Ministry of Finance 2011 - Present Chairman, Small and Medium Enterprise Development Bank of Thailand Oct 2011 - Present Chairman, Dhanarak Asset Development Co.,Ltd. 2010 - Present Chairman, Deposit Protection Agency 2010 - 2011 Board Member, Capital Market Supervisory Board The Securities and Exchange Commission 2010 - 2011 Director-General, Fiscal Policy Ofųce, Ministry of Commerce 2009 - 2010 Deputy Permanent Secretary, Ministry of Finance 2006 - 2007 Inspector-General, Ministry of Finance 1998 - 2004 Rector, Thammasat University

Chairman of the Nomination and Remuneration Committee, Independent Director, Member of the Audit Committee Education Background • Bachelor of Business Administration, Thammasat University Seminar Accomplishment The Thai Institute of Directors (IOD) • Director Accreditation Program (DAP), Class 23/2004 Number of Share Holding (%) as of 31/12/2013 -NoneExperience GMM Grammy Plc. Jul 2011 - Present Chairman of the Nomination and Remuneration Committee 2009 - Present Member of the Audit Committee 2002 - Present Independent Director 2006 - July 2011 Member of the Nomination and Remuneration Committee 2006 - Feb 2009 Chairman of the Audit Committee 2002 - 2006 Member of the Audit Committee Other Listed Companies 2011 - Present Member of the Audit Committee, Siam Future Development Plc. 2004 - Present Independent Director, Siam Future Development Plc. Oct 2011 - Present Independent Director, Patum Rice Mill and Granary Plc. Jan 2005 - Present Director, J Gallery Co.,Ltd. Nov 2004 - Present Member of the Audit Committee, The Erawan Group Plc. 2001 - Present Member of the Audit Committee, AEON Thana Sinsap (Thailand) Plc. 2006 - 2009 Advisor to the Board, President Bakery Plc. 2002 - Aug 2013 Independent Director / Member of the Audit Committee, Jay Mart Plc. Other Companies 2004 - Present President, CCC Business Development Co., Ltd. 2007 - 2009 Director, Thailand Convention and Exhibition Bureau (TCEB) (Public Organization) Chairman of the Good Governance, Recruitment and Remuneration Committee, TCEB


39

Mr. Weerawong Chittmittrapap (55 years) 2004 - 2006 2002 - 2009 2001 - 2006 1984 - 2004

Honorary Chairman, McThai Co.,Ltd. (McDonald's Thailand) Independent Director / Member of the Audit Committee, GMM Media Plc. Chairman - Ronald McDonald House Charities Foundation President & Joint Venture Partner, McThai Co.,Ltd. (McDonald's Thailand)

Chairman of the Corporate Governance and Ethics Committee, Independent Director, Member of the Audit Committee Education Background • Bachelor of Laws, Chulalongkorn University • Master of Laws, University of Pennsylvania, USA • Thai Barrister-at-Law and the ųrst Thai lawyer admitted to the New York State Bar Seminar Accomplishment The Thai Institute of Directors (IOD) • Director Certiųcation Program (DCP), Class 0/2000 Other Institutes • Capital Market Academy Leader Program, Class 12/2011, Capital Market Academy Number of Share Holding (%) as of 31/12/2013 -NoneExperience GMM Grammy Plc. Apr 2012 - Present Chairman of the Corporate Governance and Ethics Committee 2006 - Present Independent Director / Member of the Audit Committee Other Listed Companies 2013 - Present Director, Frasers and Neave Limited (Listed Company in Singapore) Dec 2012 - Present Independent Director, Chairman of the Audit Committee, Golden Land Property Development Plc. 2011 - Present Independent Director, Member of the Audit Committee, SCB Life Assurance Plc. 2009 - Present Independent Director, Member of the Audit Committee, Member of the Good Corporate Governance Committee, Member of the CSR Committee, Thai Airways International Plc. 2001 - Present Independent Director, Member of the Audit Committee, Berli Jucker Plc. 2007 - 2011 Independent Director / Member of the Audit Committee, Siam Food Products Plc. 2005 - 2006 Director, Nutrix Plc. 2001 - 2007 Independent Director / Member of the Audit Committee, ITV Plc.


40

ANNUAL REPORT 2013

GMM GRAMMY

Ms. Suvabha Charoenying (50 years) Other Companies 2013 - Present Director, Frasers Centrepoint Limited 2008 - Present Chairman, Weerawong, Chinnavat & Peangpanor Ltd. 2008 - Present Director, National Power Supply Plc. 2011 - May 2013 Independent Director, Minor International Plc. 2009 - Jan 2013 Director, Nok Airlines Co.,Ltd. 1996 - 2008 Executive Partner, White & Case (Thailand) Co., Ltd Other Present Works • Special Speaker, The Thai Institute of Directors • Special Advisor, Thai Listed Companies Association • Special Lecturer, King Prajadhipok’s Institute

Independent Director, Member of the Audit Committee, Member of the Corporate Governance and Ethics Committee Education Background • Bachelor of Business Administration (Finance), Assumption University • Master of Business Administration, Assumption University Seminar Accomplishment The Thai Institute of Directors (IOD) • Financial Institution Governance Program (2012) • Audit Committee Program (ACP), Class 35/2011 • Successful Formulation & Execution of Strategy, Class 6/2010 • DCP Refresher, Class 1/2005 • Finance for Non Finance Director, Class 1/2003 • Director Certiųcation Program (DCP) (Fellow Member), Class 1/2000 Other Institutes • Thammasat Leadership Program (TLP), Class 1/2012 Thammasat University • Certiųed Financial Planner (CFP), Thai Financial Planner Association, Class 1/2009 • TLCA Executive Development Program, Thai Listed Companies Association, Class 2/2008 • Leader Program, Capital Market Academy, Class 1/2005 • Certiųcate in Families Business : Generation to Generation, Harvard Business School (2004) Number of Share Holding (%) as of 31/12/2013 -NoneExperience GMM Grammy Plc. Apr 2012 - Present Member of the Corporate Governance and Ethics Committee 2010 - Present Independent Director / Member of the Audit Committee Other Listed Companies 2009 - Present Director / Executive Director, Thanachart Securities Plc. 2001 - Present Managing Director, Thanachart Securities Plc. 1993 - 1996 Vice President, KGI Securities Plc. 1988 - 1990 Manager, Business Development Department, Kasikorn Bank Plc


41

Other Companies 2010 - 2011 Director / Executive Director, Nakornluang Thai Securities Co.,Ltd. 1996 - 2001 Chief Executive Ofųcer, Schroder Asset Management Ltd. 1990 - 1993 Vice President, Morgan Grenfell Thai Company Limited

Director, Member of the Risk Management Committee, Member of the Group Executive Committee, Chief Executive Ofųcer (Media Business) Education Background • Bachelor of Arts (Mass Communications), Chulalongkorn University • Honorary Bachelor of Technology (Mass Communication of Technology), Rajamangala University of Technology Rattanakosin Number of Share Holding (%) as of 31/12/2013 120 shares (0%), including related parties, according to Section 59 of the Securities and Exchange Act Experience GMM Grammy Plc. May 2012 - Present Member of the Group Executive Committee Feb 2012 - Present Chief Executive Ofųcer (Media Business) 2009 - Present Member of the Risk Management Committee 2002 - Present Director 2009 - May 2012 Co-Chief Executive Director 2009 - Feb 2012 Co-Chief Executive Ofųcer 1989 - Feb 2009 Executive Director Other Listed Companies -NoneOther Companies Mar 2012 - Present Director, GMM Z Co.,Ltd. Sep 2010 - Present Director, A Gen Event Agency Co., Ltd. May 2010 - Present Director, Acts Studio Co., Ltd. Apr 2010 - Present Director, Image On Air Co., Ltd. 2009 - Present Chairman of the Board, GMM Media Plc. 2007 - Present Chief Executive Ofųce, GMM Media Plc. 2002 - Present Director / Managing Director, GMM Media Plc. Mar 2009 - Present Director, Index Creative Village Plc. 2007 - Present Director / Managing Director, A-Time Traveler Co., Ltd. 1989 - Present Director / Managing Director, A-Time Media Co., Ltd. 2008 - Feb 2009 Vice Chairman, GMM Media Plc. Nov 2007 - Feb 2009 Chairman of the Risk Management Committee, GMM Media Plc. 2005 - Oct 2007 Member of the Risk Management Committee, GMM Media Plc. 2002 - Apr 2007 Executive Director, GMM Media Plc.


42

ANNUAL REPORT 2013

GMM GRAMMY

Mr. Krij Thomas ( 53 years)

Mr. Kreingkarn Kanjanapokin (51 years)

Director, Member of the Risk Management Committee, Member of the Corporate Governance and Ethics Committee, Member of the Group Executive Committee, Chief Executive Ofųcer (Music Business), Managing Director (Grammy Gold Division), (Acting) Chief Executive Ofųcer (Satellite TV Business) Education Background • Bachelor of Arts (Mass Communications), Chulalongkorn University Number of Share Holding (%) as of 31/12/2013 1,593,600 shares (0.25%), including related parties, according to Section 59 of the Securities and Exchange Act Experience GMM Grammy Plc. Mar 2013 - Present (Acting) Chief Executive Ofųcer (Satellite TV Business) May 2012 - Present Member of the Group Executive Committee Apr 2012 - Present Member of the Corporate Governance and Ethics Committee Feb 2012 - Present Chief Executive Ofųcer (Music Business) Feb 2011 - Present Member of the Risk Management Committee 2008 - Present Director 2003 - Present Managing Director (Grammy Gold Division) 2011 - Feb 2012 Senior Executive Vice President (Music Business Division) 2008 - 2010 Executive Vice President (Music Business Division) 2005 - 2006 (Acting) Managing Director (GMM International Division) 2004 - May 2012 Executive Director 2001 - 2003 Deputy Managing Director (Grammy Gold Division) 1999 - 2001 Assistant Vice President (Grammy Gold Division) Other Listed Companies -NoneOther Companies Jul 2012 - Present Director, GMM Z Co.,Ltd. Feb 2013 - Present Director, GMM CJ O Shopping Co.,Ltd. 2007 - Present Director, 3-RD Co., Ltd. 1997 - Present Director, Krij Thomas Co.,Ltd. 2004 - Feb 2009 Director, Dokya Poojong Co.,Ltd.

Director Education Background • Bachelor of Political Science, Chiang Mai University Seminar Accomplishment The Thai Institute of Directors (IOD) • Financial Statement for Directors Program, 2008 • Director Accreditation Program (DAP), Class 30/2004 Other Institutes • Exclusive Management with Business Development and Investment, Class 1/2013 Institute of Business and Industrial Development Number of Share Holding (%) as of 31/12/2013 2,127,898 shares (0.33%), including related parties, according to Section 59 of the Securities and Exchange Act Experience GMM Grammy Plc. 2009 - Present Director 2009 - May 2012 Executive Director Other Listed Companies -NoneOther Companies May 2012 - Present Director, Index and V Co.,Ltd. Apr 2012 - Present Director, Index and M Co.,Ltd. 2008 - Present Director, GMM Media Plc. 2004 - Present Director / Co-Chief Executive Ofųcer, Index Creative Village Plc. 2001 - 2004 Managing Director, Index event Agency Co., Ltd. Other Present Works • Special Speaker, Master Degree, School of Communication Arts, University of the Thai Chamber of Commerce, Bangkok University and National Institute of Development Administration (NIDA) • Special Speaker, Reputable Institutes and Organizations.


43

Mr. Sataporn Panichraksapong (46 years)

Ms. Suwimon Chungjotikapisit (61 years)

Director, Member of the Risk Management Committee, Member of the Corporate Governance and Ethics Committee, Assistant to Executive Vice President (Music Business Division) Education Background • Bachelor of Journalism and Mass Communications (Cinematography), Thammasat University Number of Share Holding (%) as of 31/12/2013 -NoneExperience GMM Grammy Plc. Apr 2012 - Present Member of the Corporate Governance and Ethics Committee 2009 - Present Director 2009 - Present Member of the Risk Management Committee 2008 - Present Assistant to Executive Vice President (Music Business Division) 2009 - May 2012 Executive Director 2005 - 2006 Senior Vice President, Chief Executive Ofųcer Ofųce Other Listed Companies -NoneOther Companies Sep 2010 - Present Director, A Gen Event Agency Co.,Ltd. 2009 - Present Director, GMM Media Plc. 2007 - Present Director / Managing Director, GMM TV Co., Ltd. 2007 - Feb 2009 Member of the Risk Management Committee, GMM Media Plc. 2005 - 2007 Deputy Managing Director, Grammy Television Co., Ltd. 2002 - 2005 Deputy Managing Director (Music Business), RS Promotion Plc.

Director, Company Advisor Education Background • Bachelor of Political Science, Chulalongkorn University (Honors) Seminar Accomplishment The Thai Institute of Directors (IOD) • Director Certiųcation Program (DCP), Class 12/2001 Number of Share Holding (%) as of 31/12/2013 -NoneExperience GMM Grammy Plc. Nov 2010 - Present Director Aug 2008 - Present Company Advisor 2005 - Jul 2008 Advisor to the Chairman Other Listed Companies -NoneOther Companies Dec 2010 - Present Director, Index Creative Village Plc. Oct 2010 - Present Director, GR Vocal Studio Co., Ltd Sep 2010 - Present Director, A Gen Event Agency Co., Ltd. May 2010 - Present Director, Acts Studio Co., Ltd. Apr 2010 - Present Director, Image On Air Co., Ltd. 2001 - 2004 Executive Vice President, Central Pattana Plc. 2001 - 2003 Director, Central Pattana Plc. 1997 - 2001 Vice President, Central Pattana Plc. Vice President - Leasing and Marketing, Central Pattana Plc.


44

ANNUAL REPORT 2013

GMM GRAMMY

Mr. Kanchit Kawachart (48 years)

Mr. Premon Pinskul (57 years)

Member of the Group Executive Committee, Member of the Risk Management Committee, Chief Executive Ofųcer (Digital TV Business) Education Background • Bachelor of Architecture, King Mongkut’s Institute of Technology Ladkrabang • Master of Business Administration, University of Missouri, USA Seminar Accomplishment The Thai Institute of Directors (IOD) • Director Accreditation Program (DAP), Class 47/2005 Number of Share Holding (%) as of 31/12/2013 -NoneExperience GMM Grammy Plc. Mar 2013 - Present Chief Executive Ofųcer (Digital TV Business) Mar 2013 - Present Member of the Group Executive Committee Other Listed Companies 2012 - Present Member of the Audit Committee, JMT Network Services Plc. 2005 - 2013 Director / Chief Finance Ofųcer / Executive Vice President Business Development, Workpoint Entertainment Plc. 2002 - 2005 Vice President of Investment Banking Department, Thanachart Securities Plc. Other Companies Sep 2013 - Present Director, GMM HD Digital TV Co.,Ltd. Sep 2013 - Present Director, GMM SD Digital TV Co.,Ltd. 2009 - 2001 Assistant Vice President Development Fund, Ayudhya JF Asset Management Limited 1994 - 2009 Assistant Vice President, Product Development, Securities One Plc. 1988 - 1988 Architect, Architect 49 Limited

Member of the Group Executive Committee, Member of the Risk Management Committee, Chief Financial Ofųcer Education Background • Master of Accounting (Commerce and Accountancy), Thammasat University • Master of Arts (Economics), University of Detroit, USA • Master of Business Administration, University of Detroit, USA Seminar Accomplishment The Thai Institute of Directors (IOD) • Advanced Audit Committee Program (AACP), Class 2/2010 • Director Certiųcation Program (DCP), Class 114/2011 Number of Share Holding (%) as of 31/12/2013 -NoneExperience GMM Grammy Plc. Jul 2011 - Present Member of the Risk Management Committee Jun 2011 - Present Chief Financial Ofųcer May 2012 - Present Member of the Group Executive Committee Jul 2011 - May 2012 Executive Director / Secretary to the Executive Committee Jul 2011 - Mar 2012 Member of the Corporate Governance & Ethics Committee Other Listed Companies 2005 - 2011 Assistant Chief Financial Ofųcer, Total Access Communication Plc. Other Companies Oct 2013 - Present Director, GMM HD Digital TV Co.,Ltd. Oct 2013 - Present Director, GMM SD Digital TV Co.,Ltd. Mar 2012 - Present Director, GMM Z Co.,Ltd. 2011 - Present Director, 3-RD Co.,Ltd. 2011 - Present Director, GMM CJ O Shopping Co.,Ltd.


45

Mrs.Jiraporn Rungsrithong (45 years) Secretary of the Nomination and Remuneration Committee, Member of the Risk Management Committee, Member of the Group Executive Committee, Chief Investment Ofųcer and Acting Chief Administrative Ofųcer Education Background • Bachelor of Arts (German), Silpakorn University • Master of Business Administration, Winthrop University, SC, USA Seminar Accomplishment The Thai Institute of Directors (IOD) • Role of the Nomination and Governance Committee (RNG), Class 5/2013 • Director Certiųcation Program (DCP), Class 167/2012 Other Institute • Leadership Development Program (LDP), Class 1/2013, Thai Listed Companies Association • TLCA Executive Development Program (EDP2), Class 2/2008, Thai Listed Companies Association • Capital Market Academy Leader Program, Class 2/2006, Capital Market Academy • The Theory and Practice of Investor Relations (2004), University of Michigan, USA • The Primer Program-Institute of Finance (2000), Lehman Brother, NY, USA Number of Share Holding (%) as of 31/12/2013 13,200 shares (0%), including related parties, according to Section 59 of the Securities and Exchange Act Experience GMM Grammy Plc. Dec 2012 - Present Secretary of the Nomination and Remuneration Committee Aug 2012 - Present Member of the Risk Management Committee Jul 2012 - Present Member of the Group Executive Committee 23 Jul 2012 - Present Chief Investment Ofųcer and Acting Chief Administrative Ofųcer 1 - 22 Jul 2012 Chief Investment Ofųcer Other Listed Companies 2005 - 2011 Assistant Chief Financial Ofųcer, Total Access Communication Plc. Feb - Oct 2013 Director, SE-EDUCATION Plc.

1996 - Jun 2012

Senior Vice President - Investor Relations, Electricity Generating Plc.

Other Companies Feb 2013 - Present Director, Family Know-how Co.,Ltd. 2001 - Present Director, Thai Investor Relations Club 1995 - 1996 Business Analyst, Moody’s Investor Services, USA


46

ANNUAL REPORT 2013

GMM GRAMMY


47


48

ANNUAL REPORT 2013

GMM GRAMMY

Policy and Business Overview Vision, Mission and Long Term Goal Vision To be a leader in creating and producing of all forms of entertainment, in tandem with all types of media and technological developments, to provide a great quality of life and unlimited happiness. Mission Engage in the continuous creation of excellent and innovative work Encourage a learning organization Enrich people so they are passionate and skillful in their work and enjoy a better quality of life Endorse social responsibilities and activities Long Term Goal To sustainably be the number one entertainment company in Thailand.

Major change and development The Company was established in 1983 under the name of Grammy Entertainment Company Limited to operate business mainly in creating Thai music, issuing the ųrst album “Niyai Rak Jak Kon Mek” with Dr. Phanthiwa Sinratchatanan being the singer, and producing three television programs, i.e., “Yim Sai Khai,” “Man Kwa Haew” and “Siang Tid Dao.” The Company was successful and grew continuously. Details of the Company’s history and business growth can be found in the Company’s website under Main Menu “Our Company” Item “Company Background” In the past year, the Company underwent signiųcant changes in shareholders’ structures, management and business operations as follows : 2013 January February

March

April May July September

• Change in broadcasting of Channel GMM One from only GMM Z platform to broadcasting for free views on all platforms through satellite. • Ofųcial launch of satellite television services subscription for members to choose programs via satellite television channels through subscription by a prepaid card under 4 packages, namely, monthly entertainment channel package, monthly sport channel package, monthly entertainment and sport channel combined package and yearly entertainment and sport channel combined package. • Ofųcial launch of HD GMM Z satellite set-top boxes. • Launch of “Pee Mak … Phra Khanong” movie, which fetched up to Baht 567 million in box ofųce revenue, the highest amount in Thai movie history. • Change of the name of satellite television channel from GMM ONE to ONE Channel (a variety entertainment channel) for easy remembering. • Launch of “Hormones…” series, with 13 episodes in total, via satellite television ONE Channel and YouTube, an extraordinarily popular series nationwide, with over 80 million views in YouTube. • Ofųcial opening of new service for satellite television subscription under AIS mobile telephone system named "GMM Z on AIS" for customer base expansion. • Capital increase at the ratio of three existing shares to one new share at Baht 10 per share, with full subscription of 106,052,989 shares, amounting to Baht 1,060,529,890, for use in strategic investments, i.e., digital TV business to enhance and add value to the Company’s existing business. • Registration of change in the Company’s paid-up capital from Baht 530,264,947 to Baht 636,317,936 at the Registrar of Public Companies, Department of Business Development, Ministry of Commerce.


49

2013

October

November December

• Opening of “GTH Side Stories in continuation of GTH popular movies” via ONE Channel, which was the continuation production of popular movies by GTH Company Limited, with a total of 8 episodes from 8 movies. • Investing in 10,000 ordinary shares of GMM HD Digital TV Company Limited and GMM SD Digital TV Company Limited, by establishment registration at the Ministry of Commerce on September 6, 2013 at 100 baht per share, amounting to 1,000,000 baht to the Company and on October 22, 2013 GMM HD Digital TV Company Limited registered a capital increase at the Ministry of Commerce to 200 million baht with 2,000,000 shares at 100 baht per share, and GMM SD Digital TV Company Limited registered a capital increase to 100 million baht with 1,000,000 shares at 100 baht per share. • Joining in the purchase of documents on the auction for digital TV licenses, national business type from the National Broadcasting and Telecommunications Commission (NBTC). • Opening new satellite television subscription packages, namely, Gold Package that can be viewed through 14 satellite television channels and Platinum Package that can be viewed through 31 satellite television channels, with additional content on 27 channels from “Fox International Channels,” the world’s largest content provider. • Applying to participate in the auction for the licence of variety-HD channel and variety-SD channel to the National Broadcasting and Telecommunications comission (NBTC). • Change of the name and programs of satellite television channel of GTH from Play Channel, presenting variety entertainment programs to GTH on Air presenting Thai and International movies and series. • Launch of “ATM Khu Ver Error Er Rak” series via GTH on Air Channel, which was created as the continuation of “ATM Er Rak Error”, the highly popular movie with over Baht 150 million in box ofųce revenue in 2012. • Change of the name and logo of satellite television channel from Fan’Oke to Z O’ke, with 24-hour karaoke music programs being maintained. • Participating in the auction for the licenses of Variety – HD channel and Variety – SD channel.


50

ANNUAL REPORT 2013

GMM GRAMMY

Shareholding Structure of the Company Group GMM GRAMMY PLC.

100% 100%

MORE MUSIC CO., LTD. 1)

MGA CO., LTD. 1)

100% DIGITAL GEN CO., LTD. 1) 100%

EXTRAORGANIZER CO., LTD. 1)

100% GR VOCAL STUDIO CO., LTD 100% GMM MUSIC PUBLISHING INTERNATIONAL CO., LTD.

100% 70% 51%

3-RD CO., LTD. FAN TV CO., LTD.

100% 51%

DIGI STREAM CO., LTD. 10), 19) THE NEWS TV CO., LTD. 19)

50%

ST GMM CO., LTD. 19)

100%

THAWEESUK CO., LTD.)

51% GOOD THING HAPPEN CO., LTD. 15) 30%

100% GMM Z TRADING CO., LTD 3)

GLOBAL MUSIC AND MEDIA (CHINA) LIMITED 1)

100% GMM DIGITAL DOMAIN CO., LTD. 1)

NADAO BANGKOK CO., LTD.

100% DIGITAL ARMS CO., LTD. 1)

GTH ON AIR CO., LTD.

50% (THE OTHER 20% HELD BY

100%

IMAGE PUBLISHING AND 30% HELD BY GMM GRAMMY PLC.)

100%

100% JK NETWORK CO., LTD.

GMM STUDIO CO., LTD.

MEFAH CO., LTD.

100%

GMM Z CO., LTD.

100% GMM DIGITAL TV CO., LTD. 9) 100% MAXXI TV CO., LTD. 18) 100% 100%

GMM B CO., LTD. 5) G S-ONE CO., LTD. 1)

1)

100% GMM FITNESS CLUB CO., LTD. 1)

25% SAWASDEE THAWEESUK

100% GMM PUBLISHING HOUSE CO., LTD. 1)

CO., LTD. 16)

(49% HELD BY GMM HOLDING CO., LTD.)

JSL CHANNEL CO., LTD. 13)

100% GMM HOLDING CO., LTD.

THAWEESUK 14) 100% RAKDEE (OLD NAME : SAWASDEE

GDC CO., LTD.

51% GMM CJ O SHOPPING CO., LTD. 50% FAMILY KNOW HOW CO., LTD. 50% K-ARENA CO., LTD. 30%

51% GMM TAI HUB CO., LTD.

91%

MAGIC FILM CO., LTD. 1)

99.92% GMM MEDIA PLC. 100% 100%

RADIO CONCEPT CO., LTD. 1)

100% 100%

A-TIME MEDIA 70% A GEN EVENT AGENCY CO., LTD.

DEETALK CO., LTD. GMM TV CO., LTD. 70% ME MITI CO., LTD.

100% 100%

25% LUCK (666) SATELLITE CO., LTD. 19)

TEEN TALK CO., LTD.

IMAGE ON AIR CO., LTD. 1)

100% BLISS PUBLISHING CO., LTD. 70%

EXACT CO., LTD. 50% ACTS STUDIO CO., LTD.

50% 25%

70% IMAGE PUBLISHING CO., LTD. 100%

SCENARIO CO., LTD.

25% CHANNEL (V) MUSIC

(THAILAND) CO., LTD. 12)

70% 70%

GMM INTER PUBLISHING CO., LTD. GMM TIMES CO., LTD. IN PUBLISHING CO., LTD.


51

as of 31 December 2013 100% GMM HD DIGITAL TV TRADING CO., LTD. 11) 100% GMM HD DIGITAL TV CO., LTD. 11) 50%

100% GMM SD DIGITAL TV TRADING CO., LTD. 11) 100% GMM SD DIGITAL TV CO., LTD. 11)

INDEX CREATIVE VILLAGE PLC. 100% EVENT SOLUTIONS CO., LTD. 50% ASPEN INDEX EVENT CO., LTD. 1) 100% 70% 50% 60%

INDEX CREATIVE ONLINE CO., LTD.

63.30%

D 63 CO., LTD. ENVIROSEN (THAILAND) CO., LTD.

MAX CREATIVE CO., LTD.

INDEX AND V CO., LTD. 49% TVMINDEX Advertising Co., Ltd. 6) INDEX AND M CO., LTD.

49% Myanmar Index Creative Village Co., Ltd. 7) 40% 40% 50% 33% 20%

67% 50%

51% MEDIA VISION (1994) CO., LTD. 50% G COMMUNICATION CO., LTD. 50%

50%

70%

TREBIEN CO., LTD.

60% INSPIRED IMAGE CO., LTD.

50%

90% JV INDEX D 103 17)

I THINK AD CO., LTD. BLUE MEDIA COMMUNICATION CO., LTD. BIG EVENT CO., LTD. 2) HAPPIO CO.,LTD. 4) TOWN BRANDING CO.,LTD. 4)

36.7%

JV INDEX D 103 MACO JV I D 2 JV INDEX CITYNEON JV INDEX D 63 8)

Remarks: 1) Temporary discontinued operations. 2) The company was registered in Quarter1 3) GMM GRAMMY PLC., invested in common stock of GMM Z Co.,Ltd in Quarter1 4) The company was registered or jointly invested in Quarter 2. 5) GMM GRAMMY PLC., invested in common stock of GMM B Co.,Ltd in Quarter 2. 6) INDEX AND V CO.,LTD , the subsidiary of INDEX CREATIVE VILLAGE PLC., jointly invested 49% in common stock of TVMINDEX Advertising Co.,Ltd 7) INDEX AND M CO.,LTD, the subsidiary of INDEX CREATIVE VILLAGE PLC., jointly invested 49% in common stock of Myanmar Index Creative Village Co., Ltd. 8) INDEX CREATIVE VILLAGE PLC., jointly invested INDEX D 63 Co.,Ltd in Quarter2. 9) GREEN CHANNEL CO.,LTD was registered the change of company's name "GMM DIGITAL TV CO.,LTD" on July 26, 2013. GMM DIGITAL TV CO.,LTD was registered the company's liquidation on December 12, 2013. 10) BANG CHANNEL CO.,LTD was registered the change of company name "DIGISTREAM CO.,LTD" on July 31, 2013. 11) GMM GRAMMY PLC. invested in the subsidiary ; the shareholding structure are as follows: 1) GMM HD DIGITAL TV TRADING CO.,LTD with 100% shareholding and GMM HD DIGITAL TV TRADING CO.,LTD holds 100% in common stock of GMM HD DIGITAL TV CO.,LTD. 2) GMM SD DIGITAL TV TRADING CO.,LTD with 100% shareholding and GMM SD DIGITAL TV TRADING CO.,LTD holds 100% in common stock of GMM SD DIGITAL TV CO.,LTD. 12) CHANNEL (V) MUSIC (THAILAND) CO.,LTD was registered the company's liquidation on September 9, 2013. 13) JSL Channel Co.,Ltd was registered the company's liquidation on September 12, 2013. 14) SAWASDEE THAWEESUK CO.,LTD was registered change of company name to RAKDEE THAWEESUK CO.,LTD on October 22, 2013. GMM Tai Hub invested 100% in registered capital. 15) GOOD THING HAPPEN CO.,LTD was registered on October 30, 2013; GMM TAI HUB CO.,LTD invested 51% in the registered capital. 16) SAWASDEE THAWEESUK CO.,LTD was registered on October 31, 2013. GMM TAI HUB CO.,LTD invested 25% in the common stock of SAWASDEE THAWEESUK CO.,LTD. 17) INDEX CREATIVE VILLAGE PLC. entered into a joint venture agreement with JV INDEX D 103 by holding 90% of the JV in Quarter 4. 18) MAXXI TV CO.,LTD was registered the company's liquidation on December 12, 2013. 19) GMM GRAMMY PLC. invested in common stock of DIGI STREAM CO.,LTD., THE NEWS TV CO., LTD., ST GMM CO.,LTD and LUCK (666) SATELLITE CO.,LTD. 20) GMM GRAMMY PLC. sold common stock of GMM Z CO.,LTD, GMM B CO.,LTD and G S -ONE CO.,LTD to GMM Z TRADING CO.,LTD.


52

ANNUAL REPORT 2013

GMM GRAMMY

Revenue Structure and Business Description


53


54

ANNUAL REPORT 2013

GMM GRAMMY

Revenue Structure Product / Service Operated by

Revenues from music and digital businesses GMM Grammy Plc. GMM Music Publishing International Co., Ltd. Fan TV Co., Ltd. Exact Co., Ltd. Other subsidiaries Total revenues from music and digital businesses Revenues from show businesses GMM Grammy Plc. GMM Media Plc. Total revenues from show businesses Revenues from motion pictures businesses GMM Grammy Plc. GMM Tai Hub Co., Ltd. Luckdee Thaweesuk Co., Ltd. (Formerly known as "Sawasdee Thaweesuk") Good Things Happen Co., Ltd. Total revenues from motion pictures businesses Revenues from television programmes businesses GMM Grammy Plc. Exact Co., Ltd. GMM TV Co., Ltd. Deetalk Co., Ltd. Me Miti Co., Ltd. Total revenues from television programmes businesses Revenues from satellite television programmes businesses GMM Grammy Plc. Fan TV Co., Ltd. Exact Co., Ltd. GMM TV Co., Ltd. GS-One Co., Ltd. STGMM Co., Ltd. GMM Media Plc. GMM Z Co., Ltd. GMM Z Trading Co., Ltd. GTH On Air Co., Ltd. Other subsidiaries Total revenues from satellite television programmes businesses Revenues from radio programmes businesses GMM Media Plc. Total revenues from radio programmes businesses

2013 Million Baht

%

1,877.86 173.87 15.78 16.79 4.34 2,088.64

17.1 1.6 0.1 0.2 0.0 19.0

830.35 165.04 995.39

2012 Million Baht

%

2011 Million Baht

2,324.19 179.68 45.94 26.13 2.83 2,578.78

19.8 1.5 0.4 0.2 0.0 21.9

2,500.57 207.06 86.14 58.10 3.17 2,855.04

26.6 2.2 0.9 0.6 0.0 30.4

7.5 1.5 9.0

868.84 127.80 996.64

7.4 1.1 8.5

647.19 84.76 731.95

6.9 0.9 7.8

0.00 514.27 4.26

0.0 4.7 0.0

0.01 314.38 2.58

0.0 2.7 0.0

0.05 295.79 9.43

0.0 3.2 0.1

1.13 519.65

0.0 4.7

0.00 316.96

0.0 2.7

0.00 305.26

0.0 3.3

93.49 1,813.23 420.94 142.58 11.64 2,481.88

0.8 16.5 3.8 1.3 0.1 22.6

79.61 1,664.14 403.97 135.74 10.88 2,294.34

0.7 14.2 3.4 1.2 0.1 19.5

47.06 1,444.43 436.21 125.26 0.80 2,053.76

0.5 15.4 4.6 1.3 0.0 21.9

92.36 195.71 202.67 126.13 0.00 28.69 112.18 155.51 595.63 54.28 0.00 1,563.16

0.8 1.8 1.8 1.1 0.0 0.3 1.0 1.4 5.4 0.5 0.0 14.2

403.79 164.02 256.75 120.74 48.80 30.11 119.23 910.52 2.91 37.45 6.69 2,101.02

3.4 1.4 2.2 1.0 0.4 0.3 1.0 7.7 0.0 0.3 0.1 17.9

109.42 27.81 197.81 102.50 19.98 14.54 92.88 0.00 0.00 7.73 0.00 572.66

1.2 0.3 2.1 1.1 0.2 0.2 1.0 0.0 0.0 0.1 0.0 6.1

769.36 769.36

7.0 7.0

775.27 775.27

6.6 6.6

764.17 764.17

8.1 8.1

%


55

Product / Service Operated by

Revenues from event advisor and organizer businesses GMM Media Plc. In Publishing Co., Ltd. Index Creative Village Plc. Event Solutions Co., Ltd. Tresbien Co., Ltd. Media Vision (1994) Co., Ltd. G Communications Co., Ltd. Inspire Image Co., Ltd. D-63 Co., Ltd. Index Creative Online Co., Ltd. Envirosell (Thailand) Co., Ltd. Joint Venture ID2 Joint Venture Index Cityneon Joint Venture Index D103 Maco Joint Venture Index D63 A Gen Event Agency Co., Ltd. Total revenues from event advisor and organizer businesses Revenues from publishing media businesses Image Publishing Co., Ltd. GMM Inter Publishing Co., Ltd. GMM Times Co., Ltd. Bliss Publishing Co., Ltd. In Publishing Co., Ltd. Grammy Publishing House Co., Ltd. Total revenues from publishing media businesses Revenues from other businesses GMM Grammy Plc. I Think Ad Co., Ltd. 3-RD Co., Ltd. GR Vocal Studio Co., Ltd. GMM CJ O Shopping Co., Ltd. Acts Studio Co., Ltd. Other subsidiaries Total revenues from other businesses Interest income Dividend received Others income Total revenue

2013 Million Baht

%

0.00 2.10 574.10 62.94 8.78 187.25 8.34 97.29 102.12 4.14 28.77 0.00 17.37 19.01 11.10 50.54 1,173.85

0.0 0.0 5.2 0.6 0.1 1.7 0.1 0.9 0.9 0.0 0.3 0.0 0.2 0.2 0.1 0.5 10.7

47.93 42.69 30.26 5.29 17.68 0.24 144.08 47.77 46.66 137.18 15.09 558.85 68.03 11.90 885.49 49.10 34.34 298.74 11,003.69

2012 Million Baht

%

2011 Million Baht

49.08 3.84 920.51 26.52 18.00 246.88 27.23 92.98 109.94 16.36 18.25 0.08 43.12 179.01 0.00 30.41 1,782.21

0.4 0.0 7.8 0.2 0.2 2.1 0.2 0.8 0.9 0.1 0.2 0.0 0.4 1.5 0.0 0.3 15.2

14.51 27.13 699.08 31.36 13.16 179.89 26.31 79.31 113.22 15.26 0.50 33.34 10.78 21.76 0.00 42.86 1,308.46

0.2 0.3 7.4 0.3 0.1 1.9 0.3 0.8 1.2 0.2 0.0 0.4 0.1 0.2 0.0 0.5 13.9

0.4 0.4 0.3 0.0 0.2 0.0 1.3

64.55 41.39 34.28 18.36 19.54 0.00 178.12

0.5 0.4 0.3 0.2 0.2 0.0 1.5

68.77 33.53 38.87 33.65 24.48 0.00 199.31

0.7 0.4 0.4 0.4 0.3 0.0 2.1

0.4 0.4 1.2 0.1 5.1 0.6 0.1 8.0 0.4 0.3 2.7 100.0

118.22 85.97 111.33 14.60 79.78 0.00 2.25 412.14 35.76 49.00 236.22 11,756.47

1.0 0.7 0.9 0.1 0.7 0.0 0.0 3.5 0.3 0.4 2.0 100.0

82.38 108.87 106.53 11.47 0.00 0.00 2.68 311.94 29.76 54.41 201.22 9,387.96

0.9 1.2 1.1 0.1 0.0 0.0 0.0 3.3 0.3 0.6 2.1 100.0

%


56

ANNUAL REPORT 2013

GMM GRAMMY

The Group operates its business under the philosophy to work creatively, produce high quality contents, and embrace up-to-date technology, resulting in highly satisųed customers from the beginning of the Company. The Group divides its business into four main categories, comprising music business, media business, event management business, broadcasting business and other businesses. Furthermore, they can be arranged into 2 groups, namely ‘existing businesses’, which are the core businesses and have been in operation for more than 5 years, and ‘new businesses’, which are the expansion to provide sustainable growth in the future. However, the 2 groups can be subdivided into 9 businesses as follows. 1. Music businesses comprise sale and distribution of physical products, publishing management, show business, and artist management. 2. Digital content business 3. Media business comprises radio, television and publishing. 4 Movie business 5. Events management business 6. Animation business 7. Home shopping business 8. Satellite TV business comprises sale of satellite set-top box, production of TV programs to be aired on satellite TV channels, and Pay TV. 9. Digital Terrestrial TV Business


57

Music Business

Music business operates under the “Total Music Business” model, consisting of music production (physical products) and distribution, publishing management, show business and artist management business. GMM Grammy has more than 300 artists, singers, actors, and actresses under management, and more than 40,000 songs in its • music library. • Physical Products and Distribution Business In 2013, the Company released 200 music albums, covering every consumer target group, namely pop, rock, alternative, country (songs for life), R&B, soul, and compilation of top hits • during the year. Sales and distribution is carried out through

modern trade channels (superstores and discount stores), traditional trade channels (wholesalers and retailers) throughout the country, and the Company’s own “Imagine” retail stores. As of December 2013, there were 37 Imagine retail stores. Publishing Management Business The Company manages and collects copyrights fees from food operators, restaurants, radio operators, karaoke outlets, and karaoke booths and other operators who use the Company’s music for commercial purposes. Show Business This business employs its music and artist resources in producing a variety of concerts in various formats, such as promoting albums and theme concerts. In 2013, the Company organized 22 large-scale concerts. The largest ones were Khon Nok Kab Dokmai Concert : SECRET GARDEN, Grammy Happy facetival, 45 years Jennifer Kim, the Paradox Circus, 6.2.13 Dance Fever. In addition, it also organized 2 music festivals, namely Chick Mountain Music Festival and Big Mountain Music Festival. Besides generating revenues from the sale of tickets and sponsorship, this business also generates additional revenues from the sale of VCD and DVD recordings of live performances.


58

•

ANNUAL REPORT 2013

GMM GRAMMY

Artist Management Business The Company has a policy to train and develop both Music and Non-music artists to enhance their capabilities in singing, acting, and dancing. In addition, it also tries to expand revenue channels for those artists in the forms of live performance in pubs and bars, as well as employment opportunities as product presenters.

Industry Outlook In 2014, competition is expected to continue in the same way as it did over the past years. There would still be growth on physical products; therefore, the design of packaging is the main key to make ordinary physical products special gifts for the collectors. Moreover, the Company expands the distribution channels through online shop at www.shopping8000.com, and also increases the number of show to generate additional revenue for music business. Furthermore the Company also expands the music business in other countries, such as 1. Exporting physical products to other countries. 2. Publishing management is the licensing of melodies for licensees to put lyrics in their own languages. Moreover, the Company partnered up with a foreign company to manage music publishing for independent labels in Asia. 3. Exporting more shows to other countries, and also importing shows and concerts in cooperation with foreign partners.


59

Digital Content Business

Digital content is a business diversiųed from music business by the use of a developed technology. The Company has therefore developed the service into a new digital form to generate more revenue for the Company. Digital content business is to convert music content into a digital form for distribution to mobile telephone networks, the internet and entrepreneurs, with categories of download services, such as ringtone, ring-back tone, full song and full MV, in both a la carte and subscription services through channel *123 www.gmember.com and iTunes Store. Besides, the Company has offered music streaming services through KK Box application on both computer and mobile telephone, where customers can listen to Thailand and overseas popular music. Industry Outlook As the channel of distribution of digital content has changed with the developed technology, the Company has to develop the services to meet the consumer’s consumption behavior in all forms and at all ages. The Company has developed digital content services through channel *123, the country’s ųrst service provider through a digital system. Considering highly developed technologies, the Company in cooperation with a mobile telephone service provider has opened a new service, “music streaming” through KK Box application, from which customers can listen to over 10 million songs in both Thailand and overseas. Besides, the Company has sold music in digital forms through iTunes stores and telecom operators in various countries.


60

ANNUAL REPORT 2013

GMM GRAMMY

Media Business

The overall advertising expenditure in all media rose from Baht 113,945 million in 2012 to Baht 115,030 million in 2013, an increase of 0.95%. The ad spending rose continuously in the ųrst half of 2013 but in the latter half, the advertising market underwent major changes with the emergence of digital television, resulting in the slowdown of television media because of the customers’ wait-and-see attitude to the market change, resulting in slight market growth, compared to 2012. However, the media with the highest growth rate was the internet, which registered the growth rate of 53.05%, followed by mobile media, at 18.65%. Television remained the industry’s main media; it was used most by the customers and continued to retain its highest share of the ad spending, with the growth rate of 1.68%, while radio and magazine’s growth rates dropped by 0.58% and 1.38% respectively. Media Market Share of Advertising Expenditures in 2013 Total Advertising Expenditures in 2013 amounted to 115,030 million Baht


61

Value of Various Media Advertising Expenditures (million Baht)

The Group has three media business lines: radio, television and publishing with details as follows.

Radio Business Production of radio programs to be broadcasted through radio stations requires bidding for airtime for commercial purposes from various state agencies. In 2013, the Group has 3 radio stations. Radio Station

Day / Airtime / Network Coverage

Type of Program

Target Group

Working professionals, both male and female aged 30 and up who are ųnancially stable and possess high consumption power. The audience consists of people who are modern, constructive, creative, thoughtful, and considerate, and care about the environment, as well as things happening around them. Teenagers and working professionals aged between 18 - 35 who admire modern things, and follow the latest trends in all forms of entertainment. Trendy young working professionals, aged between 24 and 34 who enjoy listening to unique trendy music.

F.M. 106.5 MHz. Green Wave

24 Hours daily / Bangkok Metropolitan, Petchburi and Prachuab Khiri Khan

The ųrst and only program in Thailand that airs easy listening music program in all styles and from all eras. It is the nation’s longest standing top-rated program.

F.M. 94.0 MHz. EFM

24 Hours daily / Bangkok Metropolitan, Ang Thong, Kanchanaburi, some parts of Chonburi and Ratchaburi

Top ranked entertainment businessoriented radio station and the only station of its kind in Thailand. It is the “Talk of the Town” in being the fastest provider of accurate and in-depth reports.

F.M. 89.0 MHz. Chill FM

24 hours daily / Bangkok Metropolitan and Chonburi

Offering new and trendy “Chill Listening” music, unlike other easy listening music channels that repeatedly play the same songs.

Concession

The National Telecommunications Commission

The Royal Thai Army Radio Station

Broadcast Armor Radio Station


62

ANNUAL REPORT 2013

GMM GRAMMY

There are 525 radio stations in Thailand, 211 radio stations in Bangkok and 314 radio stations in other provinces (source: The National Telecommunications Commission). All stations are owned by government agencies, with which radio operators must lease airtime. Those agencies base their decision to lease the airtime on monetary compensation, format of programs, and ųnancial status of the operators.

Radio Advertisement Market The study of Nielsen Media Research (Thailand) Co.,Ltd., as at December 31, 2013 found that advertising expenditure on radio media was equivalent to 5.50% of total ad spending in all media. Radio advertising amount reduced from 6,358 million to 6,321 million, or 0.58%. Advertisement Expense on Radio (Million Baht)

Source : Nielsen Media Research (Thailand) Co.,Ltd.

Based on the information above, it can be seen that the radio industry has constantly Ŵuctuated from year 2002 to year 2008, then slowed down from 2009 to 2011 and rebounded in 2012, and then slightly dropped in 2013 from the political situation in the second half of 2013.

Industry Outlook The competition in the radio industry was forecasted as intense as it was in the previous year but shifted from concession acquiring and extension to market share expansion. Brand owners were more cautious in spending of their budget, as a result, operators needed to use all type of marketing strategies to create a strong brand for each station while retaining its existing customer base and expanding audience base at the same time. Attractive marketing campaign and promotions were focused to capture the target audience and reach their needs as much as possible. This method made it possible to sell more advertising on the radio. In addition, the radio operators must develop themselves and operate with more efųciency and Ŵexibility by appropriate strategies implementation under changing circumstance in order to keep the market share.


63

Television Business Television business encompasses the production of programs and shows and commission to produce programs and shows to be aired on 4 Free TV stations, namely Channels 3, 5, 7, and 9 which are the most popular advertising media and gain the most advertising revenue. All program producers under the Company have to devise creative and unique ways of presenting their programs, as well as adapting the format, quality, and content with changes and developments in the market. More importantly, the programs have to meet the needs of the television stations in terms of its policies and audience ratings. In 2013, the Group produced a total of 37 television programs in different categories. Category

program

Drama, Sit-com Variety Show Teenage Oriented Program Music Program Children Program

19 8 3 5 2 37

Total

Program Type

Dramas/Sit-coms

Variety Shows

Teenage oriented programs

Music Programs

Format

This type of program is one that the Group is most adept at producing and continues to offer its programs to television stations. During the past year, the Group’s dramas that were aired received positive audience ratings, and were among the leaders in this genre, in terms of prime time soap operas and sit-coms. The Group is considered the leader in producing sit-coms and continues to win highest market ratings, in addition to their acclaim for constructive dramas targeting teenaged viewers. A clear and well-deųned target audience. Program angles are usually based on a variety of formats: popular entertainment, current issues and ideas, combined with current events that effectively integrate knowledge and fun through famous show hosts by highlighting topics of current interest by presenting ideas, often by including a socially constructive angle, in interesting and effective way. This is an area that allows the Group to effectively showcase and maximize the organization’s potential capacity and range as a complete entertainment media giant. This is evident in developing reality shows that have been drawing a lot of attention from the Group’s primary consumers who require novel ways of showing the capabilities of the participants, such as singing. These programs cater to carefully targeted viewers. Programs cover a wide variety of entertaining formats that focus on presenting constructive and popular issues to teenaged viewers, blended with useful and creative information. It is also a channel to source new artists for the entertainment industry. Music programs featuring various artists’ music videos and concerts helps promote and publicize the Group’s latest music releases.

Children Programs This program caters to speciųc targeted viewers and uses technology to create an animation show to attract the target group. In addition, it blends in useful and creative information effectively.

Target Audience

Number of Programs

The entire family, suitable for all genders and ages

19

Teenagers and families, suited for general viewing

8

Teenagers nationwide

3

Teenagers aged 15 years and up / high school and college students / housewives The entire family, suitable for all genders and ages

5 2


64

ANNUAL REPORT 2013

GMM GRAMMY

Television Advertisement Market The study of Nielsen Media Research (Thailand) Co., Ltd., as at December 31, 2013 found that advertising expenditure on television media was equivalent to 57.83% of total ad spending in all media. Advertisement Expense on Television (Million Baht)

Source : Nielsen Media Research (Thailand) Co.,Ltd.

In the ųrst half of 2013, Thailand’s political and social situations were normal, while the economic situation registered a high growth rate, resulting in high spending on advertising through television media. In the latter half of the year, television media advertising slowed down due to the political unrest and digital TV business’s uncertainty in 2013, resulting the growth rate of advertising spending on television media in 2013 being at 1.68%, and television media remained the most used media, accounting for 60.2% of the total advertising expenditure of Baht 115,030 million.

Industry Outlook For 2014, the Company anticipates that television business is likely to grow markedly due to the entry of digital TV business, which will result in an increase of advertising time for television media, giving rise to new groups of customers with demand for television media. Particularly, small and medium enterprise (SME) groups, from the rising trend of advertising, will therefore compete for higher market shares. In such case, the media that can adapt its business to show worthiness and accessibility to target groups will ųnally be able to grow more than the competitors.


65

Publishing Business The Group’s publishing business produces monthly and bi-weekly fashion, women’s and men’s and entertainment magazines. There are a total of six publications comprising two local magazines and four magazines produced under foreign licensing. Each magazine’s unique characteristics are as follows : Magazine / Publication

Image

Madame Figaro

Her World

Maxim

In Magazine

Attitude

Content Description

Target Group

Fashion, beauty and entertainment. Noted for its trendy photographs.

No limitation on gender or age of readers. For general audience, from students to working professionals A magazine for women who are interested in fashion and appreciative Well-educated working women between of beautiful artwork. Provides entertainment and information to well 25 - 35 years with a reųned taste in beauty -educated women with good taste. and fashion Covers fashion, beauty, current issues, entertainment and lifestyles Women ranging from students to working of modern women who use their time for personal development, professionals aged between 18 - 28 in preparation for the changing world as they mature. Encompasses various aspects of a modern lifestyle for individualistic Conųdent modern men aged men between 18 - 40 men: informative and entertaining covering fashion, lifestyle, years interested in current social events, fashion, technology and health. entertainment, and cutting-edge technology. Emphasizes celebrities’ romantic relationships, in-depth interviews, Urban women, from university students to working and celebrity style tips that are adapted to the average Thai woman. professionals aged 18 - 29, with middle to high Most readers tend to be optimistic. income levels. Covers fashion and lifestyle of a group of individuals who has unique No limitation on gender or age of readers, who taste and lifestyle. have a unique lifestyle and dare to show off their lifestyle.

Magazine Advertising Market Competition in the publishing industry over the past year has eased. Nielsen Media Research (Thailand) Limited revealed that the budget allocated to magazines in 2013 was 4.80% of total media spending, equivalent to 5,518 million baht, a decline of 1.38% from the previous year. Advertisement Expense on Magazine (Million Baht)

Source : Nielsen Media Research (Thailand) Co.,Ltd.


66

ANNUAL REPORT 2013

GMM GRAMMY

Industry Outlook In 2014, the magazine publishing industry is expected to improve even though competition will remain stiff in terms of content, format, the date magazines are circulated to the stands. More importantly, there are changes in consumer behavior in light of digital innovations such as reading magazines and books on the internet, or by using hand held devices such as iPads and e-book readers. These channels have attracted the attention of many publishing companies, including GMM Grammy and its foreign magazines. For this year, the Company plans to retain its customer base and attract new customers through new distribution channels and adapt to their constantly changing lifestyles. In addition, it will offer advertising packages that bundle various media, such as print, satellite TV, outdoor billboard, and LED screen, to its customers, and provide printing services to businesses that want to share information with their customers.


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Movie Business

Movie making is a business that generates about 3 - 5% of the Company’s revenues. The business requires fairly high investments and considerable planning and production periods of approximately 8 months to 1 1/2 years, depending on the size of the project. Over the past years, GTH Co., Ltd., a subsidiary of the Company, had aimed to continue producing quality ųlms at a rate of 3 - 4 a year. The movie genres will differ from each other, such as comedies, romances, romantic comedies, and horror movies. The company is well-equipped in terms of personnel, and it has skilled teams working together in conducting in-depth market research and moviegoers before investing in new projects. This is a key reason that enables the company to offer new and novel things that have proven consistently popular among viewers.


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Industry Outlook In 2013, the ųlm industry in Thailand was worth 4,562 million baht (box ofųce ųgures only), which increased by 8.2% from 2012. Foreign movies garnered 76% of the market share while Thai movies captured approximately 24%.

In 2013, 25 Thai movies raked in total box ofųce revenues of 1,087 million baht. Only one movie produced by GTH Co., Ltd., “Pee Mak.. Phra Khanong”, was screened, but generating the all-time high Box Ofųce revenue for Thai movie of 563 million baht. The Company’s marketing strategy of promoting campaigns that reach target viewers to draw them to the cinemas is a common industry practice. Emphasis is given to setting promotional budgets and media appropriate to the intended audience. Promoting movies before they are released is an essential element in the modern ųlm industry so the audience will know what movies are going to be screened soon. Moreover, new methods of promoting movies are considered an important strategy.


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Event Management Business

Event Management is a business that offers a complete range of event management services from proposing ideas, sourcing various contractors and coordinating with related parties, to producing and managing work to meet the clients’ needs and aims. Index Creative Village Plc. and its subsidiaries are responsible for overseeing and managing related businesses which can be divided into 2 groups: 1. Creating and managing marketing media - This group is responsible for proposing creative ideas and developing marketing strategies to create a complete range of marketing communications services demanded by clients, including event marketing, advertising and public relations. 2. The production and equipment rentals group is responsible for producing and sourcing equipment for various activities. This includes preparing light, sound and special effects, as well as setting up performance stages for exhibitions. Moreover, the company also offers rentals of cameras, and light and sound editing equipment, designing and backdrop production services for television programs. By collaborating with business associates and partners worldwide, the Group also brings in interesting and attractive performances for special marketing activities. The events creation & management group’s innovative and varied offerings continue to make waves in this industry in terms

of creativity and technology. Many projects have been widely acclaimed, and the company has received the most domestic and international awards amongst its peers. Though the events management industry has more than 200 operators, most companies have fewer than 20 employees. Only 25 companies have staff sizes not exceeding 50 employees, and fewer than 10 companies have more than 50 employees. Therefore, the overall market is one where market segmentation according to company size is clearly delineated. Index Group is the only company capable of providing comprehensive services


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that are creative and delivers results, as well as a wide range of private sector businesses have a greater need for media or activities rental equipment. Thus, competition is considered relatively low to communicate through to their consumers as much as possible, in this industry. while maximizing the ef킬cacy and value in spending their marketing budgets. Moreover, trends indicate an increase in the use of more Industry Outlook frequent and large-scale marketing activities. Therefore, larger and Trends in 2014 continues to show growth prospects because these more reputable companies will stand a greater chance of winning activities are no longer limited to the private sector alone as it assignments compared to medium and small companies. Among has expanded to encompass the public sector. Many government competitors in this market, only three operators considered large. organizations have begun to increasingly use event organizers to Thus, competition in this industry is not too intense. In addition, broadcast information to the public as well as to support its work as a preparation for the ASEAN Economic Community in the next and government policies. Due to the current economic situation, few years, the Company is expanding its reach internationally.


71

Animation Business

Animation business is the production of animated cartoon television programs for terrestrial television channels, with the animated character being from the country’s most popular artist “Thongchai McIntyre” or popularly known as “Phi Bird” under the title “Byrdland … Land of Miracles.” “Byrdland” is considered a business committed to providing entertainment with knowledge to children worldwide through music, merriment and adventurous stories, aiming to stimulate children to become curious, observant, and aware of friendship, unity and preparedness in solving problems. The principle of cartoon animation is to present friendship among friends, teamwork, curiousness and contribution to the creation of a better world and peaceful co-existence.

Industry Outlook For the market outlook in 2014, the Company is conųdent that animation business will grow continuously, with the content of being interesting and meeting the requirements of viewers, both children and parents. Besides, the Company has developed content to keep up with change and suit the current situation, with good tips and ideas being inserted and awareness being instilled in children and youths, which is well received both in the country and foreign countries.


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Home Shopping Business

Home shopping business is a business of 24 hour distribution of goods, where customers can choose products, even from their own residence. The business is managed by GMM CJ O Shopping Co., Ltd., a joint venture company of GMM Grammy Pcl and CJ O Shopping Co., Ltd. from South Korea. The Company aims to become the leader of Thailand’s home shopping business by creating a phenomenon of interactive home shopping programs that are superior, fresh, novel and unique, offering knowledge about products in a straight manner in all aspects, called Shopfotainment Channel (shopping, information, and entertainment). The channel offers quality products, well recognized by consumers, with convenience and swiftness in delivery to meet customers’ demands, as well as multiple payment

options as may be deemed appropriate by the customer, choices of products and services well recognized internationally, and access to all groups of viewers.

Industry Outlook In 2014, digital TV business will be a business that will draw most attention, as its emergence will provoke interests in media consumption among people in both improvement of signals quality and addition of options in media selection for viewers, which will be positive to home shopping business because the programs will reach more customer target groups and competition will be more ųerce too, while the overall market will grow, with a total value being around Baht 5,000 million.


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Satellite TV Business

Satellite TV business can be divided into 3 main components. 1. “GMM Z� Satellite TV Platform is the Company’s new line of business, launched in March 2012 and is responsible for the sale of satellite TV set-top-box (STB) to consumers. GMM Z has a variety of products for the target audience of all levels, such as GMM Z HD for high-end level customer group, GMM Z SMART for middle-level customer group and GMM Z Mini for customers who have limited budgets but want to switch from television with antenna to satellite television. 2. Satellite TV Media is the production of TV shows to be aired on satellite TV channels. Compared to the past, this business requires relatively low investments due to good domestic and international coverage of satellite signal, mitigating the need to install additional receiving towers. All that it takes to operate this business are television channel licenses and good programs for broadcasting.


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The Group has produced television programs for airing through Thaicom satellite in two categories as follows : 2.1 Satellite television programs that can be viewed on every platform (Free to Air), in 9 channels. They are as follows : Grammy Channels

Genres

Target Audience

First Aired

Fan TV

Contemporary Thai Look Thung

General audience

October 2008

Bang Channel

Variety shows that cater to teenagers

Pre-teens and teenagers

February 2009

Green Channel

Variety talk shows, contemporary music programs, footage of rare concerts, and programs targeting working professionals’ lifestyles.

Working professionals and teenagers

March 2009

Acts Channel

Dramas, sit-coms and entertaining variety shows

General audience

April 2009

GMM Music

Contemporary music

General audience

March 2012

GMM One

Variety programs

General audience

November 2012

Money Channel*

Programs on ųnancial matters and investments

General audience and working professionals with an interest in ųnance and investments

October 2009

Saranair Channel**

Variety of comedy shows

General Audience

October 2010

JKN Channel***

Series from Korea and Japan

General Audience

April 2011

* The channel is jointly-owned (50% each) with the Stock Exchange of Thailand, through the Group’s subsidiary Family Know-How Co., Ltd. ** The channel is jointly-owned with Luck 666 Co., Ltd. holding 25%, through Luck Satellite Co., Ltd. *** The channel is jointly-owned with STG Multimedia., Ltd. by holding 50%.


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2.2 Satellite television programs that can be viewed on only GMM Z platform (Free to Box), in 6 channels. They are as follows : Grammy Channels

Genres

Target Audience

First Aired

Z Oke

24-7 Karaoke programs

General audience

November 2013

NAT GEO Wild

Entertainment on living creature’s life

General audience

March 2012

Fox Thai

American series and famous programs woth Thai dub

General audience

August 2013

GTH On Air*, **

Movie and series from GTH

General audience

November 2013

GMM Football Max

Football programs

General audience with an interest in sport

September 2012

Sport programs

General audience with an interest in sport

August 2012

- available on GMM Z HD only

GMM Sport Extra

* The channel is jointly-owned (30% each) with the Group’s subsidiary GTH Co., Ltd. and GMM Media’s subsidiary Image Publishing Co., Ltd. ** Changed name from Play Channel on May 2011


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Each GMM Z STB provides different Free to Box channels as the follow details GMM Z STB

Free to Box

Definition

Total (channels)

Mini

- Z Oke - GTH On Air

- SD - SD

2

Smartrt

-

-

5

HD

Z Oke GTH On Air Fox Thai NAT GEO Wild Sport Extra Z Oke GTH On Air Fox Thai NAT GEO Wild Sport Extra Football Max

SD SD SD SD SD HD HD SD HD HD HD

6

3. Pay TV business, a new business of the Group, was ųrst launched with satellite TV platform business by purchasing broadcasting rights from program owners or franchisees in Thailand to broadcast on the Group’s GMM Z Pay TV platform. In total, the Group’s Pay TV service has 31 channels (excluded Free to Box channels), dividing into 2 packages, namely Gold Package (199 baht per month or 1,499 baht per year), and Platinum Package (499 baht per month or 4,999 baht per year), as follows : Gold Package

Platinum Package

Definition

Genres

Target Audience

NAT GEO Adventure

NAT GEO Adventure

SD

Adventures worldwide

General audience

Nick Jr.

Nick Jr.

SD

Children programs

Pre-school children, aged 2-7 years

Baby TV

SD

Children programs

Babies, aged 0-4 years

Warner TV

Warner TV

SD

Series from overseas

General audience

StarWorld HD

StarWorld HD

HD

Variety programs from overseas

General audience


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Gold Package

Platinum Package

StarWorld HD

StarWorld HD

- broadcasted in SD on GMM Z Smart

- broadcasted in SD on GMM Z Smart

M Channel

Definition

Genres

Target Audience

SD

Variety programs from overseas

General audience

M Channel

SD

Varieties programs from Korea

General audience

Fox Action Movies HD

HD

24 hours Action movies

General audience

Fox Action Movies HD

SD

24 hours Action movies

General audience

Fox Crime

SD

Series

General audience

FX

SD

Movies and series

General audience

Stargold

SD

Ballywood movies from India

General audience

Starplus us

SD

Series, realities and entertainment programs from India

General audience

Star Chinese Movie

SD

Chinese movies from China, Taiwan and Hong Kong

General audience

Star Chinese Movie Legend

SD

Chinese Movie Legend since 70th, 80th and 90th

General audience

Star Chinese

SD

Chinese variety programs

General audience

Fox News

SD

News

General audience

- broadcasted in SD on GMM Z Smart


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ANNUAL REPORT 2013

Gold Package

GMM GRAMMY

Platinum Package

Definition

Genres

Target Audience

Sky News

SD

News

General audience

NAT GEO Music

SD

Historical documentary

General audience

Channel V Thailand

SD

Music program

General audience

Channel V

SD

Music program

General audience

Eurosport

Eurosport

SD

Sport from Europe i.e. Tour De France, US Open, Winter Sport and etc.

General audience

Eurosport HD

Eurosport HD

HD

Sport from Europe i.e. Tour De France, US Open, Winter Sport and etc.

General audience

Fox Sports News

Fox Sports News

SD

Sport news

General audience

Fox Sports News

Fox Sport Plus HD

HD

Sport news

General audience

Fox Sport Plus HD

SD

Sport news

General audience

- broadcasted in SD on GMM Z Smart Star Sports

SD

Sport news

General audience

GMM Club Channel

SD

Sport programs about 킬rst-class football clubs

General audience

GMM Club Channel


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Gold Package

GMM Sport One

Platinum Package

Definition

Genres

Target Audience

GMM Sport One

SD

Sport programs

General audience

GMM Football Max

SD

Sport programs about famous football matches

General audience

Fox Sports

SD

Sport programs

General audience

For both packages, consumers can apply under three different channels as follows : First channel : SMS code via mobile phone • Dial the call center at (662) 841 8888, chose the package and wait for SMS code • Pay at Counter Service or MPAY Second channel : Pay slip at convenience store • Pay the package at convenience store i.e. 7-eleven, Tesco Lotus or any store with E-Pay logo or U top up • Dial the call center at (662) 841 8888 to activate Third channel : Pay via credit card • Dial the call center at (662) 841 8888, chose the package and pay via credit card (VISA, Master Card, JCB, Kasikorn credit card, Krungthai credit card and Bangkok Bank credit card - except American Express or AMEX)


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Industry Outlook After the announcement of the Broadcasting and Public Media Act BE 2551 on 5 March 2008, cable and satellite television industry operators were stimulated as they are now permitted to legally operate and earn advertisement revenue from advertisement spots not exceeding six minutes per hour. Consequently, the cable and satellite television business has become more attractive and is considered a viable channel for new television operators since there were more than 15.8 million households watching television via satellite and cable TV in November 2013 (Source: AGB Nielsen). Goods and services advertised by both direct customers and agencies in television programs through satellite television channels have risen in number due to the increased number of viewers and the accessibility to target audience under product segmentation that can be with ef킬ciently selected for speci킬c satellite television viewer groups, while the advertising fee rates of satellite television channels are much less than those of free television channels. For this reason, the degree of competition in satellite & cable TV business is more intense, the competition in the television platform market is also rising in intensity, with the platform owner having quality contents of their own and contents from different platforms, which will be of advantage to customer base expansion because consumers have learned more of how to choose platforms worth their expenses. For pay TV service business in Thailand, it is expected that, although it is at the beginning stage, the growth opportunity will be high because pay TV business is undergoing change from market monopoly by only one company in Thailand to competition from multiple platform owner companies, opening more choices for consumers.


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Digital Terrestrial TV Business

The National Broadcasting and Telecommunications Commission (NBTC) arranged an auction for 24 frequency licenses for use in the broadcasting of commercial Digital Terrestrial Television (DTT) during December 26 - 27, 2013. The licenses were divided into 4 categories, namely Kid and Family (3 licenses), News (7 licenses), Variety - Standard De킬nition (SD) (7 licenses), and Variety - High De킬nition (HD) (7 licenses). GMM Grammy participated in the auction and won 2 licenses - Variety SD, and Variety HD. At present, GMM Grammy is in the process of applying for all required licenses from the Of킬ce of NBTC and other agencies in order to be able to commence trial broadcasting of the 2 DTT channels in early April 2014.


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Risk Factors


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Risk Factors The Board of Directors has placed high importance on risk management processes at both corporate and operational levels, in line with the risk management policy and framework formulated by the Group to mitigate risks to be at an acceptable level, suitable to the environment of each business unit’s nature of working or activities. The management and staff at all levels are encouraged to take part in the processes and risk management systems are put in place across the organization and instilled as part of the Group’s culture, while the Risk Management and Internal Control Department is assigned to develop risk management systems in accordance with international practices and integrate risk management practices at each level with all related departments under the supervision of the Risk Management Committee. Besides, the Group’s management has well implemented the risk management practices, including risk management follow-up and reporting to the Board of Directors on a regular basis. In 2013, the Group has improved strategies in various areas on a continued basis, aiming to manage risks that may arise in both new and core businesses of the Group, such as preparation on production technologies and capital funds, improvement of organizational structures and work processes, and human resources development at high and middle levels in support of the Group’s business management team in response to rapid business growth.

Corporate Risk 1. Risk from Piracy Piracy is one factor that uniformly affects music and movie Business worldwide. Every year, the Group has to contend with adaptation and duplication of their music, which are then sold cheaply in large quantities. New forms of piracy have emerged with the latest technological developments, such as using the Group’s products for commercial purposes on the internet. Consequently, the Group loses substantial valuable business opportunities every year. Nonetheless, the government has issued various measures in a serious attempt to improve the protection and reduction of piracy. The latest measures are comprehensive, ranging from controlling the process of importing machines that can be used to produce pirated products, to controlling production and distribution processes. Penalties and ųnes have been increased against violators. Rewards are handed to police or to people who offer leads to the production, storage and retail sites of pirated goods. Moreover, to promote legal purchase of goods, the Group has continuously developed additional channels of distribution in line with technological change to provide more convenience to consumers, such as music downloading services on an ‘a la carte’ (individual song) basis, and monthly subscription basis, to leading mobile telephone network operators in Thailand through *123, website www.gmember.com and itune store including new digital content service ‘music streaming’ from KK Box application, aiming to facilitate continued purchase of songs, etc. In the ųlm industry, the Group has received warm cooperation from theatre operators in issuing various measures to reduce illegal recordings. The Group expects that with serious and continual collaboration between the government and private sectors, the use of pirated products will decrease signiųcantly, beneųting the entire music industry in the future. 2. Risk of business interruptions due to force majeure The Group has envisioned the importance of business operations continuity, without interruptions, especially for major business processes of the Group in case of force majeure, such as natural disasters, man-made hazards, technological hazards or computer virus attacks, protests, disturbances, enactment of new legislation, etc. The Board of Directors has therefore appointed a Business Continuity Plan Committee (BCP) to push ahead with the development of a business continuity plan (BCP) in a concrete manner to absorb impacts and minimize damage that may befall the Company’s major business processes, creating conųdence that the work systems and workplaces are able to cope with disasters or equipped with systems capable of managing emergencies and returning to normal operations quickly.


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3. Risk from Retard Internal Process Adjustment to the Rapid Business Expansion The Group has nine businesses composes of music business, digital content business, media business, movie business, event management business, animation business, home shopping business, broadcasting business and digital terrestrial TV business. Each business has its own characteristic which also requires different staff’s talent and expertise. In addition, the rapid business expansion of the Group may affect the internal process adjustment of each business group in various ways, such as The Group’s organization structure etc. and may create overlap of processes between business units and supporting units. Besides, some centralized policies issue may not support some processes of current business units or new business units. Consequently, these may cause risk from retard internal process adjustment to the rapid business expansion. In order to sustain the business growth, however, such risk has been efųciently managed by revising organization structure and adjusting key processes in order to effectively implement all centralized policies together with developing a standardized performance evaluation across all units in the Group. 4. Risk from Relying on Individual Talent The Group’s business is mainly based on people. The business has been grown by staff with experiences and distinctive talent especially for the music business, radio business, television business and media business. All staff, regardless of whether they are the artist or all the different supporting teams, are recognized as valuable members having high impact on the Group’s operations. Hence, whenever they move to a different corporate afųliate or other companies, this means a valuable loss which requires the Group to spend additional time developing new artists or supporting teams to replace them. However, the Group has continually managed the risk by focusing on developing and supporting all staff by involving them more in business operations. Furthermore, the Group has developed the standardized performance evaluation together with placing great importance on revising compensation package and beneųts for staff to be competitive compared to the other companies in the same industry. In addition, in order to keep the business growth in balance, the Group has invested in new businesses which most based on technology or systems such as home shopping business, satellite business and digital terrestrial TV business.


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Management Discussion and Analysis of the Financial Position and Operating Results of 2013 (a) Operating results Overview of the past operations The Company organizes its structure into four business units according to the types of business, namely, music business, media business (radio, television, movie and publishing), broadcasting business and event creation and management business, which can be summarized by each business as follows: 1. Music business comprises three businesses, namely, physical products distribution business, digital content business and show business. In 2013, the revenue from music business amounted to Baht 3,084 million, a decline of 14% from the previous year, from physical products distribution business and digital content business due to changes in consumer behavior from listening from CD’s or downloading to mobile phones or electronic devices, to music streaming service. The change resulted in the Company closing down some retail stores upon the termination of the lease agreement, and the opening of music streaming service in the fourth quarter of 2013. The Company expects that the music streaming service would be able to offset the decline in revenue from music business as the Company plans to expand the subscriber base of its music streaming service in 2014. For showbiz, the revenue in 2013 was about the same level as the previous year although a number of shows in the last quarter had to be postponed due to the political rallies in Bangkok. 2. Media business comprises four businesses, namely, radio business, television business, publishing business and movie business. In 2013, media business’s revenue was Baht 3,915 million, an increase of 10% from the previous year, with movie business and television business growing by 64% and 8% respectively from the success of “Pee Mak”, which generated the highest box ǰ ǰ PGųDFǰSFWFOVFǰJOǰ5IBJǰNPWJFǰIJTUPSZ ǰBOEǰUIFǰTVDDFTTǰPGǰUFMFWJTJPOǰQSPHSBNǰQSPEVDUJPOǰGPSǰCSPBEDBTUJOHǰPOǰGSFFǰUFMFWJTJPOǰ channels, together with the overall growth of television advertising market. In 2014, 24 new digital terrestrial television channels will begin operations, resulting in further growth of television advertising market. For radio business and publishing business, the revenue declined from the previous year by 1% and 19% respectively, due to the Company’s reduction of the number of radio stations for broadcasting to three stations (from previously four stations) and the shrinkage of the overall publishing market. 3. Broadcasting business comprises satellite set-top box distribution business, satellite television subscription business and satellite television media business. 3.1 For satellite set-top box distribution business, in 2013, the Company was able to sell about one million satellite set-top boxes and with the earlier sold set-top boxes from the beginning of this business included, the total number of set-top boxes sold was about 2.4 million. Revenue from sale of satellite set-top boxes in 2013 was Baht 673 million, a decline of 26% from the previous year because in 2012 there was live broadcasts of Euro 2012 tournament, which could be viewed only through the Company’s satellite set-top boxes, resulting in the Company selling higher than normal number of satellite set-top boxes. In 2014, the Company expects to sell more satellite set-top boxes from digital terrestrial television broadcasting, which can be viewed via satellite television platforms under “Must Carry” rule enforced by NBTC and the expansion of Pay TV subscribers. 3.2 Satellite television subscription (Pay TV) business, the Company began Pay TV service in early 2013 after being licensed by NBTC in late 2012, with about 100,000 subscribers and Baht 47 million in revenue at the end of 2013. In 2014, the Company, in cooperation with the recipient of the rights to broadcast the English Premier League (“EPL”) football competitions, will have the EPL broadcast live on the Company’s platform, resulting in the Company’s Pay TV (comprising sport, entertainment and knowledge programs) having the most completed and largest contents in the market. Besides, the Company will provide additional local quality content, which will contribute to the expansion of the subscriber base to achieve the target. 3.3 Satellite television business continues to grow. Currently, the Company has nine satellite television channels, generating advertising revenue on a regular basis for the Company. In 2013, the revenue from this business was Baht 843 million, an increase of 9% from the previous year. 4. Event creation and management business in 2013 posted Baht 1,174 million in revenue, a decline of 34% from the previous year, because in 2012 the Company was contracted to organize a number of big events, such as, BOI Fair and World Expo, but in 2013 there were no such big events. However, the Company has expanded the business to neighboring countries by cooperating with strong partners in each of the countries to accommodate the emergence of ASEAN Economic Community in 2015.


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GMM Grammy Group in 2013 registered Baht 11,004 million in revenue, a decline of 6% from the previous year, and a net loss of Baht 1,283 million. The loss rose by 298% from the previous year due to the decline in revenue and the rise of costs in music business where the policy on provision for inventory was changed, broadcasting business where amortization for content and satellite transponder fees were recorded, and the increase of sales and management expenses from operations of new business.

(b) GMM Grammy Group’s financial position as at the end of 2013 1) Assets The Group’s total assets at the end of 2013 amounted to Baht 12,604 million, increasing by Baht 1,138 million from the previous year, with major items as follows: ǰ ǰ

2 Temporary investments amounting to Baht 2,066 million, an increase of 1,510 million, resulting from the use of proceeds Ç° GSPNÇ°UIFÇ°TBMFÇ°PGÇ°MPOHUFSNÇ°JOWFTUNFOUTÇ°UPÇ°JOWFTUÇ°JOÇ°ĹłOBODJBMÇ°JOTUSVNFOUT 2 Inventory amounting to Baht 620 million, a decline of Baht 420 million, resulting from the change of policy on provision of inventories in music business and satellite set-top boxes sale. 2 Other long-term investments amounting to Baht 342 million, a decline of Baht 1,160 million, resulting from the sale of some long-term investments.

2) Liabilities Ç° Ç°

The Group’s total liabilities at the end of 2013 amounted to Baht 8,627 million, an increase of Baht 1,090 million from the previous year, resulting from the increase of bank overdrafts and short-term borrowings from the previous year, deducted by SFQBZNFOUǰPGǰMPOHUFSNǰCPSSPXJOHTǰEVFǰEVSJOHǰUIFǰZFBSǰBOEǰUIFǰJODSFBTFǰPGǰFNQMPZFFĴTǰMPOHUFSNǰCFOFųUǰSFTFSWFT

3) Equity At the end of 2013, the Group’s equity amounted to Baht 3,977 million, an increase of Baht 48 million from the previous year. The Group registered a capital increase of 106 million shares, by issuing new shares to existing shareholders at the ratio of 5 existing shares to 1 new share at Baht 10 per share. However, the Group registered an operating loss of Baht 1.283 million for 2013. -JRVJEJUZǰBOEǰDBTIǰŴPXT ǰ ǰ ǰ ǰ

Cash and cash equivalents amounted to Baht 1,653 million, an increase of Baht 808 million, involving cash for operation amounting to Baht 839 million, for investment activities at Baht 403 million, mostly equipment purchase for production and CVTJOFTTÇ°PQFSBUJPOT Ç°BOEÇ°OFUÇ°DBTIÇ°GSPNÇ°ĹłOBODJBMÇ°QSPDVSFNFOUÇ°BDUJWJUJFTÇ°BUÇ°#BIUÇ° Ç°NJMMJPOÇ°GSPNÇ°DBQJUBMÇ°JODSFBTFÇ°BOEÇ°CBOLÇ° overdrafts and short-term borrowings, deducted by repayment of long-term borrowings as due. The overall liquidity and cash Ĺ´PXTÇ°BUÇ°UIFÇ°FOEÇ°PGÇ°Ç°XFSFÇ°BUÇ°BÇ°HPPEÇ°MFWFM Ç°TVHHFTUJOHÇ°HPPEÇ°MJRVJEJUZÇ°BOEÇ°TUSPOHÇ°ĹłOBODJBMÇ°QPTJUJPOÇ°PGÇ°UIFÇ°(SPVQ

4) Key ratios Ç° Ç° Ç° Ç°

*OÇ° Ç°UIFÇ°(SPVQÇ°SFHJTUFSFEÇ°BÇ°ESPQÇ°PGÇ°SFWFOVFÇ°CZÇ°Ç°GSPNÇ°UIFÇ°QSFWJPVTÇ°ZFBSÇ°BOEÇ°BOÇ°JOJUJBMÇ°QSPĹłUÇ°NBSHJOÇ°PGÇ° Ç°BÇ°ESPQÇ° GSPNÇ°UIFÇ°QSFWJPVTÇ°ZFBSÇ°EVFÇ°UPÇ°BÇ°MPXFSÇ°JOJUJBMÇ°QSPĹłUÇ°NBSHJOÇ°PGÇ°TFUUPQÇ°CPYFT Ç°DPNQBSFEÇ°XJUIÇ°UIFÇ°FYJTUJOHÇ°CVTJOFTT Ç°BOEÇ°BOÇ°PQFSBUJOHÇ° loss and a net loss of 9.98% and 11.66%, compared with 1.10% and 2.96% in 2012 respectively, due to the loss from investment in broadcasting business, which was under investment period. The Company will propose to the shareholders’ meeting to suspend dividend payment for the operating results of 2013 so as to set aside cash for investment in new businesses. The interest coverage ratio was - 2.61 times, compared to - 9.06 times in 2012. Besides, the Group’s liquidity ratio was at 1.11 times, debt to equity ratio 2.17 times, average collection period 74 days and average sale period 39 days.

 Ç° ,FZÇ°GBDUPSTÇ°BOEÇ°JOĹ´VFODFTÇ°UIBUÇ°NBZÇ°BGGFDUÇ°GVUVSFÇ°PQFSBUJOHÇ°SFTVMUTÇ°BOEÇ°ĹłOBODJBMÇ°TUBOEJOH

Ç° Ç°

The Company will operate digital television business in 2014 after winning 2 licenses from the auction to use frequencies for digital terrestrial television, namely, Variety - HD channel (No. 31) and Variety - SD channel (No. 25). Currently, the Group is in the process of applying for related licenses and making preparations for programs and contents to be broadcasted in mid-2014. As one of the country’s largest television program producers, with long-standing experiences in this business, the $PNQBOZǰJTǰDPOųEFOUǰUIBUǰUIFǰ$PNQBOZĴTǰEJHJUBMǰUFMFWJTJPOǰDIBOOFMTǰXJMMǰCFǰBNPOHǰUIFǰDPVOUSZĴTǰUPQǰųWFǰQPQVMBSǰUFMFWJTJPOǰ channels.


87

Report on the Board of Director’s Responsibility towards the Financial Statements The Board of Directors recognizes the importance of the Corporate Governance Management Policy and the preparing process of the ĹłOBODJBMÇ°TUBUFNFOUÇ°BOEÇ°ĹłOBODJBMÇ°JOGPSNBUJPOÇ°BTÇ°SFQPSUFEÇ°JOÇ°UIFÇ°BOOVBMÇ°SFQPSUÇ°FOBCMFÇ°UPÇ°FOTVSFTÇ°UIBUÇ°UIFÇ°TUBUFNFOUTÇ°BSFÇ°QSFQBSFEÇ°JOÇ° BDDPSEBODFÇ°XJUIÇ°UIFÇ°5IBJÇ°HFOFSBMMZÇ°BDDFQUFEÇ°BDDPVOUJOHÇ°TUBOEBSET Ç°VTJOHÇ°BQQSPQSJBUFÇ°BOEÇ°DPOTJTUFOUÇ°BDDPVOUJOHÇ°QPMJDZÇ°BOEÇ°TVGĹłDJFOUÇ° JOGPSNBUJPOÇ°JTÇ°EJTDMPTFEÇ°JOÇ°UIFÇ°OPUFTÇ°UPÇ°ĹłOBODJBMÇ°TUBUFNFOUTÇ°5IFÇ°#PBSEÇ°PGÇ°%JSFDUPSTÇ°IBTÇ°BQQPJOUFEÇ°"VEJUÇ°$PNNJUUFF Ç°XIJDIÇ°DPNQSJTFTÇ° JOEFQFOEFOUÇ°EJSFDUPST Ç°UPÇ°CFÇ°SFTQPOTJCMFÇ°GPSÇ°UIFÇ°RVBMJUZÇ°PGÇ°ĹłOBODJBMÇ°SFQPSUTÇ°BOEÇ°JOUFSOBMÇ°DPOUSPMÇ°5IJTÇ°BMTPÇ°QSPWJEFÇ°BÇ°SFBTPOBCMFÇ°BTTVSBODFÇ° POÇ°UIFÇ°SFMJBCJMJUZÇ°PGÇ°UIFÇ°ĹłOBODJBMÇ°TUBUFNFOUÇ°BOEÇ°FGGFDUJWFOFTTÇ°PGÇ°JOUFSOBMÇ°DPOUSPMÇ°TVDIÇ°BTÇ°TBGFHVBSEJOHÇ°PGÇ°BTTFUTÇ°DPOOFDUFEÇ°PSÇ°QPUFOUJBMÇ° DPOĹ´JDUÇ°PGÇ°JOUFSFTUÇ°USBOTBDUJPOTÇ°BOEÇ°UIFÇ°DPNQMJBODFÇ°UPÇ°BQQMJDBCMFÇ°MBXTÇ°BOEÇ°SFHVMBUJPOT Ç°XIJDIÇ°UIFÇ°"VEJUÇ°$PNNJUUFFÄ´TÇ°PQJOJPOÇ°JTÇ°TUBUFEÇ° in the Audit Committee Report. At the Board of Directors’ meeting on February 28, 2014, which every Audit Committee members, management and internal audit EFQBSUNFOUÇ°BUUFOEFEÇ°UPÇ°FWBMVBUFÇ°UIFÇ°TVGĹłDJFODZÇ°PGÇ°UIFÇ°$PNQBOZÄ´TÇ°JOUFSOBMÇ°DPOUSPMÇ°TZTUFNÇ°GPSÇ°UIFÇ°ZFBSÇ°Ç°5IFÇ°TZTUFN Ç°TFUÇ°CZÇ°UIFÇ° management which compliance with the SET regulations and COSO guideline. The Board agreed with the Audit Committee that the (..Ç°(SBNNZÇ°(SPVQÄ´TÇ°RVBSUFSMZÇ°BOEÇ°UIFÇ°BOOVBMÇ°ĹłOBODJBMÇ°TUBUFNFOUÇ°GPSÇ°UIFÇ°ZFBSÇ°Ç° XIJDIÇ°IBTÇ°CFFOÇ°BVEJUFEÇ°CZÇ°UIFÇ°$PNQBOZÄ´TÇ° FYUFSOBMÇ°BVEJUPS Ç°IBTÇ°CFFOÇ°QSFQBSFEÇ°JOÇ°BDDPSEBODFÇ°XJUIÇ°HFOFSBMMZÇ°BDDFQUFEÇ°BDDPVOUJOHÇ°QSJODJQMFTÇ°BOEÇ°EJTDMPTFEÇ°TVGĹłDJFOUMZ Ç°BDDVSBUFMZÇ° and reliably. In general, the internal control system of the Company and subsidiaries was fairly established and appropriate to the $PNQBOZÇ°CVTJOFTTÇ°5IFSFÇ°XFSFÇ°OPÇ°JOUFSOBMÇ°DPOUSPMÇ°EFĹłDJFODJFTÇ°XIJDIÇ°XPVMEÇ°BGGFDUÇ°UIFÇ°BDDVSBDZÇ°BOEÇ°SFMJBCJMJUZÇ°PGÇ°ĹłOBODJBMÇ°TUBUFNFOUÇ° BOEÇ°UIFÇ°BDIJFWFNFOUÇ°PGÇ°UIFÇ°FOUJUZÄ´TÇ°CVTJOFTTÇ°HPBMÇ°5IFÇ°#PBSEÇ°PGÇ°%JSFDUPSTÇ°IBTÇ°FYQSFTTFEÇ°UIFÇ°PQJOJPOÇ°POÇ°UIFÇ°TVGĹłDJFOUÇ°PGÇ°UIFÇ°$PNQBOZÇ° and subsidiaries’ internal control system in “Internal Controlâ€? section. Furthermore, the Board encourages the Management in continuous developing the GMM Grammy Group’s quality of internal control system, risk management and good corporate governance. The adequate and appropriate supervision should also be in place to enable the achievement of the established objective and goal.

Ç°

Mr. Paiboon Damrongchaitham $IBJSNBOÇ°

Ms. Boosaba Daorueng (SPVQÇ°$IJFGÇ°&YFDVUJWFÇ°0GĹłDFS


89

Independent Auditor’s Report

To the Shareholders of GMM Grammy public Company Limited *ǰIBWFǰBVEJUFEǰUIFǰBDDPNQBOZJOHǰDPOTPMJEBUFEǰųOBODJBMǰTUBUFNFOUTǰPGǰ(..ǰ(SBNNZǰ1VCMJDǰ$PNQBOZǰ-JNJUFE ǰJUTǰTVCTJEJBSJFTǰǰBOEǰJUTǰ KPJOUMZǰDPOUSPMMFEǰFOUJUJFT ǰXIJDIǰDPNQSJTFǰǰUIFǰDPOTPMJEBUFEǰTUBUFNFOUǰPGǰųOBODJBMǰQPTJUJPOǰBTǰBUǰǰ%FDFNCFSǰ ǰBOEǰUIFǰSFMBUFEǰ DPOTPMJEBUFEǰTUBUFNFOUTǰPGǰJODPNF ǰDPNQSFIFOTJWFǰJODPNF ǰDIBOHFTǰJOǰTIBSFIPMEFSTĴǰFRVJUZǰBOEǰDBTIǰŴPXTǰGPSǰUIFǰZFBSǰUIFOǰFOEFE ǰ BOEǰBǰTVNNBSZǰPGǰTJHOJųDBOUǰBDDPVOUJOHǰQPMJDJFTǰBOEǰPUIFSǰFYQMBOBUPSZǰJOGPSNBUJPO ǰBOEǰIBWFǰBMTPǰBVEJUFEǰUIFǰTFQBSBUFǰųOBODJBMǰ statements of GMM Grammy Public Company Limited for the same period.

Management’s Responsibility for the Financial Statements

.BOBHFNFOUǰJTǰSFTQPOTJCMFǰGPSǰUIFǰQSFQBSBUJPOǰBOEǰGBJSǰQSFTFOUBUJPOǰPGǰUIFTFǰųOBODJBMǰTUBUFNFOUTǰJOǰBDDPSEBODFǰXJUIǰ5IBJǰ'JOBODJBMǰ 3FQPSUJOHǰ4UBOEBSET ǰBOEǰGPSǰTVDIǰJOUFSOBMǰDPOUSPMǰBTǰNBOBHFNFOUǰEFUFSNJOFTǰJTǰOFDFTTBSZǰUPǰFOBCMFǰUIFǰQSFQBSBUJPOǰPGǰųOBODJBMǰ statements that are free from material misstatement, whether due to fraud or error.

Auditor’s Responsibility

.ZǰSFTQPOTJCJMJUZǰJTǰUPǰFYQSFTTǰBOǰPQJOJPOǰPOǰUIFTFǰųOBODJBMǰTUBUFNFOUTǰCBTFEǰPOǰNZǰBVEJUǰ*ǰDPOEVDUFEǰNZǰBVEJUǰJOǰBDDPSEBODFǰXJUIǰ Thai Standards on Auditing. Those standards require that I comply with ethical requirements and plan and perform the audit to obtain SFBTPOBCMFǰBTTVSBODFǰBCPVUǰXIFUIFSǰUIFǰųOBODJBMǰTUBUFNFOUTǰBSFǰGSFFǰGSPNǰNBUFSJBMǰNJTTUBUFNFOU "OǰBVEJUǰJOWPMWFTǰQFSGPSNJOHǰQSPDFEVSFTǰUPǰPCUBJOǰBVEJUǰFWJEFODFǰBCPVUǰUIFǰBNPVOUTǰBOEǰEJTDMPTVSFTǰJOǰUIFǰųOBODJBMǰTUBUFNFOUTǰ The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the ųOBODJBMǰTUBUFNFOUT ǰXIFUIFSǰEVFǰUPǰGSBVEǰPSǰFSSPSǰ*OǰNBLJOHǰUIPTFǰSJTLǰBTTFTTNFOUT ǰUIFǰBVEJUPSǰDPOTJEFSTǰJOUFSOBMǰDPOUSPMǰSFMFWBOUǰ UPǰUIFǰFOUJUZĴTǰQSFQBSBUJPOǰBOEǰGBJSǰQSFTFOUBUJPOǰPGǰUIFǰųOBODJBMǰTUBUFNFOUTǰJOǰPSEFSǰUPǰEFTJHOǰBVEJUǰQSPDFEVSFTǰUIBUǰBSFǰBQQSPQSJBUFǰ in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by NBOBHFNFOU ǰBTǰXFMMǰBTǰFWBMVBUJOHǰUIFǰPWFSBMMǰQSFTFOUBUJPOǰPGǰUIFǰųOBODJBMǰTUBUFNFOUT *ǰCFMJFWFǰUIBUǰUIFǰBVEJUǰFWJEFODFǰ*ǰIBWFǰPCUBJOFEǰJTǰTVGųDJFOUǰBOEǰBQQSPQSJBUFǰUPǰQSPWJEFǰBǰCBTJTǰGPSǰNZǰBVEJUǰPQJOJPO

Opinion

*OǰNZǰPQJOJPO ǰUIFǰųOBODJBMǰTUBUFNFOUTǰSFGFSSFEǰUPǰBCPWFǰQSFTFOUǰGBJSMZ ǰJOǰBMMǰNBUFSJBMǰSFTQFDUT ǰUIFǰųOBODJBMǰQPTJUJPOǰPGǰ(..ǰ(SBNNZǰ Public Company Limited, its subsidiaries and its jointly controlled entities and of GMM Grammy Public Company Limited as at 31 December  ǰBOEǰUIFJSǰųOBODJBMǰQFSGPSNBODFǰBOEǰDBTIǰŴPXTǰGPSǰUIFǰZFBSǰUIFOǰFOEFE ǰJOǰBDDPSEBODFǰXJUIǰ5IBJǰ'JOBODJBMǰ3FQPSUJOHǰ4UBOEBSET

Emphasis of matter

*ǰESBXǰBUUFOUJPOǰUPǰ/PUFǰǰUPǰUIFǰųOBODJBMǰTUBUFNFOUTǰSFHBSEJOHǰUIFǰDIBOHFǰJOǰBDDPVOUJOHǰQPMJDZǰBTǰUIFǰSFTVMUǰPGǰBEPQUJPOǰPGǰ5IBJǰ "DDPVOUJOHǰ4UBOEBSEǰǰ*ODPNFǰ5BYFTǰ5IFǰ$PNQBOZǰIBTǰSFTUBUFEǰUIFǰDPOTPMJEBUFEǰBOEǰTFQBSBUFǰųOBODJBMǰTUBUFNFOUTǰGPSǰUIFǰZFBSǰFOEFEǰ ǰ%FDFNCFSǰ ǰQSFTFOUFEǰIFSFJOǰBTǰDPNQBSBUJWFǰJOGPSNBUJPO ǰUPǰSFŴFDUǰUIFǰBEKVTUNFOUǰSFTVMUJOHǰGSPNǰTVDIǰDIBOHFǰ5IFǰ$PNQBOZǰ IBTǰBMTPǰQSFTFOUFEǰDPOTPMJEBUFEǰBOEǰTFQBSBUFǰTUBUFNFOUTǰPGǰųOBODJBMǰQPTJUJPOǰBTǰBUǰǰ+BOVBSZǰǰBTǰDPNQBSBUJWFǰJOGPSNBUJPO ǰVTJOHǰ UIFǰOFXMZǰBEPQUFEǰBDDPVOUJOHǰQPMJDZǰGPSǰJODPNFǰUBYFTǰ.ZǰPQJOJPOǰJTǰOPUǰRVBMJųFEǰJOǰSFTQFDUǰPGǰUIJTǰNBUUFS

Other matter

5IFǰDPOTPMJEBUFEǰųOBODJBMǰTUBUFNFOUTǰPGǰ(..ǰ(SBNNZǰ1VCMJDǰ$PNQBOZǰ-JNJUFE ǰJUTǰTVCTJEJBSJFTǰBOEǰJUTǰKPJOUMZǰDPOUSPMMFEǰFOUJUJFTǰBOEǰ UIFǰTFQBSBUFǰųOBODJBMǰTUBUFNFOUTǰPGǰ(..ǰ(SBNNZǰ1VCMJDǰ$PNQBOZǰ-JNJUFEǰGPSǰUIFǰZFBSǰFOEFEǰǰ%FDFNCFSǰǰ CFGPSFǰSFTUBUFNFOU ǰ BOEǰǰ%FDFNCFSǰǰ XIJDIǰIBWFǰCFFOǰVTFEǰGPSǰQSFQBSJOHǰUIFǰDPOTPMJEBUFEǰBOEǰTFQBSBUFǰTUBUFNFOUTǰPGǰųOBODJBMǰQPTJUJPOǰBTǰBUǰǰ +BOVBSZǰǰBTǰEFTDSJCFEǰJOǰUIFǰQSFDFEJOHǰQBSBHSBQI ǰXFSFǰBVEJUFEǰCZǰBOPUIFSǰBVEJUPSǰPGǰPVSǰųSN ǰXIPǰFYQSFTTFEǰBOǰVORVBMJųFEǰ opinion on those statements, under his report dated 28 February 2013 and 27 February 2012, respectively. Khitsada Lerdwana $FSUJųFEǰ1VCMJDǰ"DDPVOUBOUǰ 5IBJMBOE ǰ/Pǰ &:ǰ0GųDFǰ-JNJUFE 'PSNFSMZǰLOPXOǰBTǰ&SOTUǰǰ:PVOHǰ0GųDFǰ-JNJUFE

Bangkok: 28 February 2014


90

ANNUAL REPORT 2013

GMM GRAMMY

Statement of financial position GMM Grammy Public Company Limited, its subsidiaries and its jointly controlled entities As at 31 December 2013 (Unit: Baht)

Consolidated financial statements Note

Assets Current assets Cash and cash equivalents Current investments Trade and other receivables Prepaid expenses Inventories Advance payments Other current assets Total current assets Non-current assets Investments in subsidiaries Investments in joint ventures Investments in associates Other long-term investments Loans to related parties Property, plant and equipment Goodwill Other intangible assets Deferred tax assets Other non-current assets Total non-current assets Total assets

8 9 7, 10 11 12

13 14 15 16 7 17 18 29 19

Separate financial statements

31 December 31 December 1 January 31 December 31 December 1 January 2013 2012 2012 2013 2012 2012 (Restated) (Restated)

1,653,068,457 844,857,204 1,016,223,148 863,469,373 139,996,047 152,718,893 2,065,744,052 556,056,952 327,702,001 1,875,000,000 2,421,665,581 2,782,461,200 2,107,387,495 1,732,603,998 1,825,114,407 1,024,423,680 269,123,628 319,740,469 283,695,360 81,111,437 29,823,473 90,410,229 619,683,133 1,039,382,170 995,153,845 180,991,100 399,986,756 540,321,358 166,797,832 187,845,188 115,698,439 37,941,732 32,092,106 42,230,470 1,581,576,144 575,403,467 594,164,085 91,250,849 57,906,676 437,284,932 8,777,658,827 6,305,746,650 5,440,024,373 4,862,368,489 2,484,919,465 2,287,389,562 - 1,143,965,558 1,214,956,258 979,788,789 9,999,800 9,999,800 301,388,745 301,475,312 254,187,759 27,999,980 27,999,980 27,999,980 342,480,115 1,502,115,635 1,093,978,535 341,080,415 674,546,035 517,918,835 4,966,135 6,200,000 1,375,707 1,594,957,000 14,000,000 18,500,000 1,785,008,678 1,631,236,702 1,075,009,414 128,092,829 109,259,214 131,646,735 79,857,240 79,857,240 79,857,240 530,177,835 1,134,563,064 384,964,798 368,889,878 315,255,912 361,639,725 242,151,873 155,562,138 118,080,549 109,872,151 62,865,028 57,143,527 539,823,838 348,708,277 205,004,417 154,562,724 107,566,372 86,225,663 3,825,854,459 5,159,718,368 3,212,458,419 3,879,420,335 2,536,448,599 2,180,863,254 12,603,513,286 11,465,465,018 8,652,482,792 8,741,788,824 5,021,368,064 4,468,252,816

The accompanying notes are an integral part of the financial statements.


91

Statement of financial position (continued) GMM Grammy Public Company Limited, its subsidiaries and its jointly controlled entities As at 31 December 2013 (Unit: Baht)

Consolidated financial statements Note

Liabilities and shareholders’ equity Current liabilities Bank overdraft and short-term loans from banks Trade and other payables Unearned income Short-term loans from related parties Current portion of long-term loans Current portion of liabilities under ǰ ǰ ųOBODFǰMFBTFǰBHSFFNFOUTǰ Income tax payable Other current liabilities Total current liabilities Non-current liabilities Long-term loans - net of current portion ǰ -JBCJMJUJFTǰVOEFSǰųOBODFǰMFBTFǰBHSFFNFOUT - net of current portion ǰ 1SPWJTJPOǰGPSǰMPOHUFSNǰFNQMPZFFǰCFOFųUTǰ Deferred tax liabilities Other non-current liabilities Total non-current liabilities Total liabilities

20 7, 21

Separate financial statements

31 December 31 December 1 January 31 December 31 December 1 January 2013 2012 2012 2013 2012 2012 (Restated) (Restated)

4,329,436,625 2,521,758,913 549,444,048 28,848,000

3,109,190,200 2,546,583,847 513,199,411 301,348,000

1,254,711,649 1,992,125,474 599,438,172 123,208,000

2,000,000,000 677,799,943 86,902,119 1,363,000,000 -

326,000,000 725,712,018 81,442,870 280,000,000

214,000,000 965,864,879 87,362,636 -

18,720,700 31,274,645 437,197,471 7,916,680,402

22,783,664 35,805,992 436,498,789 6,965,409,903

22,757,233 58,822,993 293,979,259 4,345,042,780

9,992,644 136,604,436 4,274,299,142

11,555,306 130,840,122 1,555,550,316

11,081,433 86,741,301 1,365,050,249

22

281,152,000

152,886,422

243,323,287

-

-

195,778,000

23 25 29

40,557,404 335,038,191 14,505,810 38,799,113 710,052,518 8,626,732,920

45,301,414 260,840,105 80,730,290 31,243,572 571,001,803 7,536,411,706

38,911,641 232,054,639 48,913,537 31,889,007 595,092,111 4,940,134,891

23,807,726 142,600,365 14,491,042 180,899,133 4,455,198,275

24,318,618 119,257,123 80,544,166 224,119,907 1,779,670,223

22,408,724 108,498,142 48,840,969 375,525,835 1,740,576,084

7 22 23 24

The accompanying notes are an integral part of the financial statements.


92

ANNUAL REPORT 2013

GMM GRAMMY

Statement of financial position (continued) GMM Grammy Public Company Limited, its subsidiaries and its jointly controlled entities As at 31 December 2013 (Unit: Baht)

Consolidated financial statements Note

Shareholders’ equity Share capital Registered 636,317,936 ordinary shares of Baht 1 each (31 December 2012: 530,556,100 ordinary shares of Baht 1 each) Issued and fully paid 636,317,936 ordinary shares of Baht 1 each (31 December 2012: 530,264,947 ordinary shares of Baht 1 each) Paid-in capital Share premium Transferred of share premium to offset EFųDJUǰJOǰTFQBSBUFǰųOBODJBMǰTUBUFNFOUT Capital surplus from share premium of subsidiaries Retained earnings Appropriated - statutory reserve Transfer of statutory reserve to offset EFųDJUǰJOǰTFQBSBUFǰųOBODJBMǰTUBUFNFOUT 6OBQQSPQSJBUFEǰ EFųDJU

Other components of shareholders’ equity Equity attributable to owners of the Company Non-controlling interests of the subsidiaries Total shareholders’ equity Total liabilities and shareholders’ equity

Separate financial statements

31 December 31 December 1 January 31 December 31 December 1 January 2013 2012 2012 2013 2012 2012 (Restated) (Restated)

26

26

27

636,317,936

530,556,100

530,556,100

636,317,936

530,556,100

530,556,100

636,317,936

530,264,947

530,264,947

636,317,936

530,264,947

530,264,947

2,580,594,677 1,626,117,776 1,626,117,776 2,580,594,677 1,626,117,776 1,626,117,776 271,203,657

271,203,657

271,203,657

-

-

-

860,964,766

860,964,766

860,964,766

-

-

-

63,631,794

53,055,610

53,055,610

63,631,794

53,055,610

53,055,610

50,000,000 50,000,000 308,369,917 630,432,847 (654,354,809) (1,031,526,954)

948,081,976 57,964,166

710,082,846 322,176,662

323,577,359 194,661,040

50,000,000 (1,012,031,563) (405,052,318)

3,045,628,949 3,045,621,864 2,990,512,649 4,286,590,549 3,241,697,841 2,727,676,732 931,151,417 883,431,448 721,835,252 3,976,780,366 3,929,053,312 3,712,347,901 4,286,590,549 3,241,697,841 2,727,676,732 12,603,513,286 11,465,465,018 8,652,482,792 8,741,788,824 5,021,368,064 4,468,252,816 -

The accompanying notes are an integral part of the financial statements.


93

Income statement GMM Grammy Public Company Limited, its subsidiaries and its jointly controlled entities For the year ended 31 December 2013 (Unit: Baht)

Consolidated financial statements Separate financial statements Note Revenues Sales of goods Service income Revenues from copyrights Interest income Dividend received Gains on disposal of equipment Other income Total revenues Expenses Cost of sales and services Selling and servicing expenses Administrative expenses Losses on sale of investment in subsidiaries Total expenses 1SPĹłUÇ° MPTT Ç°CFGPSFÇ°TIBSFÇ°PGÇ°QSPĹłUÇ°GSPNÇ°JOWFTUNFOUTÇ°JOÇ° Ç° Ç° BTTPDJBUFT Ç°ĹłOBODFÇ°DPTUÇ°BOEÇ°JODPNFÇ°UBYÇ°FYQFOTFT Ç° 4IBSFÇ°PGÇ°QSPĹłUÇ°GSPNÇ°JOWFTUNFOUTÇ°JOÇ°BTTPDJBUFTÇ° 1SPĹłUÇ° MPTT Ç°CFGPSFÇ°ĹłOBODFÇ°DPTUÇ°BOEÇ°JODPNFÇ°UBYÇ°FYQFOTFT Finance cost 1SPĹłUÇ° MPTT Ç°CFGPSFÇ°JODPNFÇ°UBYÇ°FYQFOTFT Income tax expenses 1SPĹłUÇ° MPTT Ç°GPSÇ°UIFÇ°ZFBSÇ°

15

29 Ç°

Ç° 1SPĹłUÇ° MPTT Ç°BUUSJCVUBCMFÇ°UP Equity holders of the Company Non-controlling interests of the subsidiaries

#BTJDÇ°FBSOJOHTÇ°QFSÇ°TIBSF Ç° 1SPĹłUÇ° MPTT Ç°BUUSJCVUBCMFÇ°UPÇ°FRVJUZÇ°IPMEFSTÇ°PGÇ°UIFÇ°$PNQBOZÇ° The accompanying notes are an integral part of the financial statements.

31 Ç°

2013

2012 (Restated)

2013

2012 (Restated)

2,275,712,562 2,276,537,801 7,524,195,398 8,177,171,690 821,605,631 981,770,747 49,100,220 35,760,970 34,337,903 49,001,431 19,444,938 298,739,789 216,777,577 11,003,691,503 11,756,465,154

1,001,678,302 1,739,392,635 754,682,192 63,023,109 514,848,922 1,601,441 107,181,874 4,182,408,475

1,236,899,082 2,005,827,013 848,305,554 3,814,927 374,575,496 3,511,906 64,094,865 4,537,028,843

7,786,845,221 8,062,464,172 1,007,462,162 874,766,160 3,216,015,680 2,863,030,286 12,010,323,063 11,800,260,618

2,362,166,247 46,855,569 1,344,653,882 148,499,604 3,902,175,302

2,949,566,073 55,332,978 1,100,087,943 4,104,986,994

(1,006,631,560) 15,976,285 (990,655,275) (139,285,489) (1,129,940,764) (91,210,971) (1,221,151,735)

(43,795,464) 87,489,155 43,693,691 (108,396,070) (64,702,379) (184,268,630) (248,971,009)

280,233,173 280,233,173 (60,461,379) 219,771,794 34,431,079 254,202,873

432,041,849 432,041,849 (23,415,967) 408,625,882 (22,120,395) 386,505,487

(1,282,709,774) 61,558,039 (1,221,151,735)

(322,062,930) 73,091,921 (248,971,009)

254,202,873

386,505,487

 Ç°

 Ç°

Ç°Ç°




94

ANNUAL REPORT 2013

GMM GRAMMY

Statement of comprehensive income GMM Grammy Public Company Limited, its subsidiaries and its jointly controlled entities For the year ended 31 December 2013 (Unit: Baht)

Consolidated financial statements

Ç° 1SPĹłUÇ° MPTT Ç°GPSÇ°UIFÇ°ZFBS Ç° 0UIFSÇ°DPNQSFIFOTJWFÇ°JODPNF Actuarial losses - net of income tax expenses Ç° &YDIBOHFÇ°EJGGFSFODFTÇ°POÇ°USBOTMBUJPOÇ°PGÇ°ĹłOBODJBMÇ°TUBUFNFOUTÇ°JOÇ° foreign currency Gain (loss) on change in value of available-for-sale investments - net of income tax expenses 0UIFSÇ°DPNQSFIFOTJWFÇ°JODPNFÇ°GPSÇ°UIFÇ°ZFBS 5PUBMÇ°DPNQSFIFOTJWFÇ°JODPNFÇ°GPSÇ°UIFÇ°ZFBS Ç° 5PUBMÇ°DPNQSFIFOTJWFÇ°JODPNFÇ°BUUSJCVUBCMFÇ°UP Equity holders of the Company Non-controlling interests of the subsidiaries

The accompanying notes are an integral part of the financial statements.

Ç°

Separate financial statements

2013

2012 (Restated)

2013

2012 (Restated)

(1,221,151,735)

(248,971,009)

254,202,873

386,505,487

(32,957,248) Ç° (1,339,716)

Ç° 356,523

(5,627,559) Ç° -

Ç° -

88,804,015 54,507,051

376,815,622 377,172,145

(264,212,496) (269,840,055)

127,515,622 127,515,622

(1,166,644,684)

128,201,136

(15,637,182)

514,021,109

(1,222,360,997) 55,716,313 (1,166,644,684)

55,109,215 73,091,921 128,201,136

(15,637,182)

514,021,109


ĹłOBODJBMÇ°TUBUFNFOUT

5SBOTGFSÇ°PGÇ° share premium UPÇ°PGGTFUÇ°EFĹłDJUÇ° JOÇ°TFQBSBUFÇ°

Ç° Ç° Ç°

-

-

-

-

-

Setting aside to statutory reserve (Note 27)

Equity attributable to non-controlling interests of the subsidiaries -

-

-

-

-

-

-

-

-

The accompanying notes are an integral part of the financial statements.

636,317,936 2,580,594,677 271,203,657

-

Disposal of available-for-sale investments

#BMBODFÇ°BTÇ°BUÇ°Ç°%FDFNCFSÇ°Ç°

-

Total comprehensive income for the year

954,476,901

106,052,989

-

Share capital issued (Note 26)

-

530,264,947 1,626,117,776 271,203,657

Balance as at 1 January 2013 - as restated

Cumulative effect of the change in accounting policies due to the adoption of Thai Accounting Standard 12 Income taxes (Note 4)

530,264,947 1,626,117,776 271,203,657

-

Balance as at 1 January 2013 - as previously reported

-

-

530,264,947 1,626,117,776 271,203,657

Equity attributable to non-controlling interests of the subsidiaries

-

#BMBODFÇ°BTÇ°BUÇ°Ç°%FDFNCFSÇ°Ç°Ç°BTÇ°SFTUBUFE

-

530,264,947 1,626,117,776 271,203,657

-

530,264,947 1,626,117,776 271,203,657

Ç° 4IBSFÇ° premium

Ç° *TTVFEÇ°BOEÇ°Ç° Ç° QBJEVQÇ° share capital

Total comprehensive income for the year (restated)

Balance as at 1 January 2012 - as restated

Cumulative effect of the change in accounting policies due to the adoption of Thai Accounting Standard 12 Income taxes (Note 4)

Balance as at 1 January 2012 - as previously reported

Ç°

Ç°

Ç°

Ç° Ç° Ç°

Ç° Ç° Ç°

Ç° Ç° Ç°

860,964,766

-

-

-

-

-

860,964,766

-

860,964,766

860,964,766

-

-

860,964,766

-

860,964,766

63,631,794

-

10,576,184

-

-

-

53,055,610

-

53,055,610

53,055,610

-

-

53,055,610

-

53,055,610

Ç° Ç° Ç°

(Unit: Baht)

630,432,847

108,975,691

521,457,156

-

-

308,369,917

134,389,322

173,980,595

308,369,917

-

(10,576,184)

-

50,000,000 (1,012,031,563)

-

-

-

- (1,309,825,296)

-

50,000,000

-

50,000,000

50,000,000

-

- (322,062,930)

50,000,000

-

50,000,000

(48,840,969)

-

-

(48,840,969)

60,134,722

-

376,815,622

-

-

-

-

-

377,172,145

-

55,109,215

(80,544,166)

-

-

(80,544,166)

53,845,156

1,388,055

-

-

-

(1,339,716)

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

161,838,192 161,838,192

87,464,299 (1,222,360,997)

- 1,060,529,890

57,964,166 (274,800,348) (189,604,191) (405,052,318) 3,045,628,949

-

-

161,838,192

88,804,015

-

2,727,771 (192,678,041) (274,800,348) (189,604,191) (654,354,809) 3,045,621,864

-

2,727,771 (112,133,875) (274,800,348) (189,604,191) (573,810,643) 2,991,776,708

2,727,771 (192,678,041) (274,800,348) (189,604,191) (654,354,809) 3,045,621,864

-

356,523

2,371,248 (569,493,663) (274,800,348) (189,604,191) (1,031,526,954) 2,990,512,649

-

2,371,248 (520,652,694) (274,800,348) (189,604,191) (982,685,985) 2,930,377,927

69,694,669

88,504,275

128,201,136

75,678,493

(7,996,344)

-

161,838,192

931,151,417 3,976,780,366

(7,996,344)

-

-

55,716,313 (1,166,644,684)

- 1,060,529,890

883,431,448 3,929,053,312

21,833,337

861,598,111 3,853,374,819

883,431,448 3,929,053,312

88,504,275

73,091,921

721,835,252 3,712,347,901

9,559,947

712,275,305 3,642,653,232

ǰ ǰ$POTPMJEBUFEǰųOBODJBMǰTUBUFNFOUT ǰ &RVJUZǰBUUSJCVUBCMFǰUPǰPXOFSTǰPGǰUIFǰ$PNQBOZǰ ǰ ǰ ǰ ǰ0UIFSǰDPNQPOFOUTǰPGǰTIBSFIPMEFSTĴǰFRVJUZǰ ǰ ǰ ǰ0UIFSǰDPNQSFIFOTJWFǰJODPNFǰ 0UIFSǰDIBOHFTǰCZǰUIFǰPXOFST Exchange ǰ ǰ 3FUBJOFEǰFBSOJOHTǰ ǰ EJGGFSFODFTǰPOǰ 4VSQMVTǰ EFųDJU ǰ ǰ %JGGFSFODFǰSFTVMUJOHǰ ǰ Transfer of statutoryǰ ǰ USBOTMBUJPOǰPGǰǰ POǰDIBOHFTǰ $BQJUBMǰEFųDJUǰǰ GSPNǰTIBSFǰTXBQǰ 5PUBMǰPUIFSǰ 5PUBMǰFRVJUZǰ &RVJUZǰBUUSJCVUBCMFǰ ǰ Capital surplus fromǰǰ ǰ SFTFSWFǰUPǰPGGTFUǰ ǰ ųOBODJBMǰ JOǰWBMVFǰPGǰ GSPNǰCVTJOFTTǰ CFUXFFOǰUIFǰ DPNQPOFOUTǰPGǰ BUUSJCVUBCMFǰUPǰ UPǰOPODPOUSPMMJOHǰ 5PUBM TIBSFǰQSFNJVNǰǰ "QQSPQSJBUFEǰǰ EFųDJUǰJOǰTFQBSBUFǰ 6OBQQSPQSJBUFEǰ TUBUFNFOUTǰJOǰ available-for-sale combination under Company shareholders’ owners of interests of shareholders’ of subsidiaries statutory reserve ųOBODJBMǰTUBUFNFOUTǰ EFųDJU ǰ GPSFJHOǰDVSSFODZǰ JOWFTUNFOUTǰ DPNNPOǰDPOUSPMǰ BOEǰBǰTVCTJEJBSZǰ FRVJUZǰ UIFǰ$PNQBOZǰ UIFǰTVCTJEJBSJFTǰ FRVJUZ

Ç° Ç° Ç°

GMM Grammy Public Company Limited, its subsidiaries and its jointly controlled entities For the year ended 31 December 2013

Statement of changes in shareholders’ equity

95


The accompanying notes are an integral part of the financial statements.

Balance as at 1 January 2013 - as previously reported Cumulative effect of the change in accounting policies due to the adoption of Thai Accounting Standard 12 Income taxes (Note 4) Balance as at 1 January 2013 - as restated Share capital issued (Note 26) Setting aside to statutory reserve (Note 27) Total comprehensive income for the year #BMBODFÇ°BTÇ°BUÇ°Ç°%FDFNCFSÇ°Ç°

1,626,117,776 1,626,117,776 954,476,901 2,580,594,677

530,264,947 530,264,947 106,052,989 636,317,936

1,626,117,776 1,626,117,776

530,264,947 530,264,947

Share premium

Ç°

1,626,117,776

Ç° Issued and paid-up share capital

Ç°

Ç°

530,264,947

Ç°

Ç°

Ç°

53,055,610 10,576,184 63,631,794

53,055,610

53,055,610 53,055,610

53,055,610

62,865,028 710,082,846 (10,576,184) 248,575,314 948,081,976

647,217,818

57,143,527 323,577,359 386,505,487 710,082,846

266,433,832

(80,544,166) 322,176,662 (264,212,496) 57,964,166

402,720,828

(48,840,969) 194,661,040 127,515,622 322,176,662

243,502,009

(80,544,166) 322,176,662 (264,212,496) 57,964,166

402,720,828

(48,840,969) 194,661,040 127,515,622 322,176,662

243,502,009

Other ǰ ǰ DPNQSFIFOTJWFǰ JODPNF ǰ ǰ 4VSQMVTǰ EFųDJU ǰPOǰ 5PUBMǰPUIFS Retained earnings changes in value of components of Appropriated available-for-sale shareholders’ statutory reserve Unappropriated investments equity

0UIFSÇ°DPNQPOFOUTÇ°PGÇ°TIBSFIPMEFSTÄ´Ç°FRVJUZ

Ç° 4FQBSBUFÇ°ĹłOBODJBMÇ°TUBUFNFOUTÇ°

(17,679,138) 3,241,697,841 1,060,529,890 (15,637,182) 4,286,590,549

3,259,376,979

8,302,558 2,727,676,732 514,021,109 3,241,697,841

2,719,374,174

Total shareholders’ equity

(Unit: Baht)

ANNUAL REPORT 2013

Balance as at 1 January 2012 - as previously reported Cumulative effect of the change in accounting policies due to the adoption of Thai Accounting Standard 12 Income taxes (Note 4) Balance as at 1 January 2012 - as restated Total comprehensive income for the year (restated) #BMBODFÇ°BTÇ°BUÇ°Ç°%FDFNCFSÇ°Ç°Ç°BTÇ°SFTUBUFEÇ°

Ç°

Ç°

GMM Grammy Public Company Limited, its subsidiaries and its jointly controlled entities For the year ended 31 December 2013

Statement of changes in shareholders’ equity (continued)

96 GMM GRAMMY


97

Statement of cash flows GMM Grammy Public Company Limited, its subsidiaries and its jointly controlled entities For the year ended 31 December 2013 (Unit: Baht)

Consolidated financial statements Separate financial statements 2013

2012 (Restated)

$BTIÇ°Ĺ´PXTÇ°GSPNÇ°PQFSBUJOHÇ°BDUJWJUJFTÇ° Ç° 1SPĹłUÇ° MPTT Ç°CFGPSFÇ°UBYÇ° Ç°     Ç°    Ç° Ç° "EKVTUNFOUTÇ°UPÇ°SFDPODJMFÇ°QSPĹłUÇ° MPTT Ç°CFGPSFÇ°UBYÇ°UPÇ°OFUÇ°DBTIÇ° Ç° Ç° Ç° provided by (paid from) operating activities: Depreciation 350,241,749 297,832,244 Amortisation 376,693,688 512,732,145 Allowance for doubtful accounts (reversal) (35,692,951) (4,892,411) Reduction of cost of inventory to net realisable value 203,584,529 23,364,197 Provision for sales returns (reversal) 108,088,209 2,547,981 Allowance for impairment of investments in subsidiaries (reversal) Allowance for impairment of investments in associate Allowance for impairment of other long-term investments (reversal) (5,497,909) Losses (gains) on sale of investment in subsidiaries Gain on sale of other long-term investments (114,395,297) (10,359,961) Loss (gain) on disposal of equipment 4,651,926 (18,527,166) Dividend received (34,337,903) (49,001,431) Ç° Ç° 4IBSFÇ°PGÇ°QSPĹłUÇ°GSPNÇ°JOWFTUNFOUTÇ°JOÇ°BTTPDJBUFTÇ° Ç°    Ç°    Ç° Ç° Ç° -POHUFSNÇ°FNQMPZFFÇ°CFOFĹłUÇ°FYQFOTFTÇ° Ç°   Ç°Ç°   Ç°Ç° Interest income (49,100,220) (35,760,970) Interest expenses 139,285,489 108,396,070 Ç° 1SPĹłUÇ° MPTT Ç°GSPNÇ°PQFSBUJOHÇ°BDUJWJUJFTÇ°CFGPSFÇ°DIBOHFTÇ°JOÇ°PQFSBUJOHÇ° Ç° Ç° Ç° assets and liabilities (157,350,915) 699,647,521 Decrease (increase) in operating assets Trade and other receivables 396,488,570 (670,181,294) Prepaid expenses 50,616,841 (72,146,749) Inventories 84,195,979 (36,045,109) Advance payments 21,047,356 (177,855,901) Other current assets (302,256,582) 78,118,572 Other non-current assets (408,516,814) (1,282,478,028) The accompanying notes are an integral part of the financial statements.

2013

2012

  Ç° Ç°

  Ç°

52,142,359 61,836,714 (9,056,967) 207,907,599 (536,516) 37,999,500 5,000,000 148,499,604 (24,200,000) (1,601,442) (514,848,922) Ç°   Ç°Ç° (63,023,109) 60,461,378 Ç° 201,003,125

62,793,626 377,607,707 (8,966,290) 23,671,040 2,810,980 (36,985,583) (5,497,910) (300) (10,359,961) (3,511,906) (374,575,496)     (3,814,927) 23,415,967 Ç° 465,971,810

28,739,125 (704,447,851) (51,287,964) 10,138,364 (22,880,152) 60,586,756 (5,849,626) 103,862,499 50,533,847 261,184,376 (149,790,681) (185,388,880)


98

ANNUAL REPORT 2013

GMM GRAMMY

(Unit: Baht)

Consolidated financial statements Separate financial statements 2013

2012 (Restated)

2013

Increase (decrease) in operating liabilities Trade and other payables (9,627,331) 528,741,295 (89,233,132) Unearned income 36,244,637 (86,238,761) 5,459,249 Other current liabilities (107,389,527) 139,971,549 4,257,444 Ç° Ç° 1SPWJTJPOÇ°GPSÇ°MPOHUFSNÇ°FNQMPZFFÇ°CFOFĹłUTÇ° Ç°    Ç°    Ç°    Ç° Other non-current liabilities 7,555,541 (645,437) Ç° $BTIÇ°Ĺ´PXTÇ°VTFEÇ°JOÇ°PQFSBUJOHÇ°BDUJWJUJFTÇ° Ç°    Ç°    Ç°    Ç° Cash paid for interest expenses (151,768,569) (97,297,131) (48,795,595) Cash paid for income tax (291,783,245) (317,302,996) (64,366,526) Ç° /FUÇ°DBTIÇ°Ĺ´PXTÇ°VTFEÇ°JOÇ°PQFSBUJOHÇ°BDUJWJUJFT (839,089,437) (1,295,933,269) (146,553,226) Ç° $BTIÇ°Ĺ´PXTÇ°GSPNÇ°JOWFTUJOHÇ°BDUJWJUJFT Acquisition of equipment (518,299,220) (827,675,751) (63,899,221) Decrease in accounts payable - purchase of assets (2,714,523) Cash received from disposal of investments in subsidiaries Cash received from returning investment of associates 13,151,602 Cash received from disposal of other long-term investments 1,456,410,000 18,449,490 27,400,000 Cash paid to purchase additional investments in subsidiaries - (97,508,898) Cash paid to purchase additional investments in jointly controlled entities Cash paid to purchase additional investments in associates (22,487,426) Cash paid to purchase of other long-term investments (741,500) (2,209,900) Cash received from disposal of equipments 22,011,596 39,876,291 6,432,355 Decrease (increase) in loans to related parties 1,233,865 (4,824,293) (1,580,957,000) Dividend received from other long-term investments 34,337,903 49,001,431 5,925,503 Dividend received from subsidiaries and associates 41,501,678 27,050,000 594,314,812 Cash received from non-controlling interests of subsidiaries from investments in subsidiaries 55,951,000 172,790,814 Interest income 39,711,431 35,760,970 42,581,171 Increase in current investments (1,509,687,100) (228,354,951) (1,875,000,000) Ç° /FUÇ°DBTIÇ°Ĺ´PXTÇ°GSPNÇ° VTFEÇ°JO Ç°JOWFTUJOHÇ°BDUJWJUJFT (402,772,296) (706,984,297) (2,940,711,278) The accompanying notes are an integral part of the financial statements.

2012

(240,100,142) (5,919,766) 41,287,841    

(22,963,457) (64,022,676) (279,811,126) (38,112,769) (505,229) 31,999,500 18,449,490 (230,181,086) (9,999,800) 16,322,046 4,500,000 19,871,431 267,427,479 3,814,927 83,585,989


99

Statement of cash flows (continued) GMM Grammy Public Company Limited, its subsidiaries and its jointly controlled entities For the year ended 31 December 2013 Consolidated financial statements Separate financial statements (Restated) Ç° $BTIÇ°Ĺ´PXTÇ°GSPNÇ°ĹłOBODJOHÇ°BDUJWJUJFT Increase in bank overdrafts and short-term loans from banks Cash received from short-term loans from related parties Cash received from long-term loans Repayment of long-term loans Ç° 3FQBZNFOUÇ°PGÇ°MJBCJMJUJFTÇ°VOEFSÇ°ĹłOBODFÇ°MFBTFÇ°BHSFFNFOUTÇ° Dividend paid to non-controlling interests of subsidiaries Proceeds from increase in share capital Ç° /FUÇ°DBTIÇ°Ĺ´PXTÇ°GSPNÇ°ĹłOBODJOHÇ°BDUJWJUJFT *ODSFBTFÇ° EFDSFBTF Ç°JOÇ°USBOTMBUJPOÇ°BEKVTUNFOUT Ç° /FUÇ°JODSFBTFÇ° EFDSFBTF Ç°JOÇ°DBTIÇ°BOEÇ°DBTIÇ°FRVJWBMFOUT Cash and cash equivalents at beginning of year Cash and cash equivalents at end of year

Ç°

4VQQMFNFOUBMÇ°DBTIÇ°Ĺ´PXTÇ°JOGPSNBUJPO Non-cash transactions: Assets purchases which payment has yet to be made Ç° Ç° *ODSFBTFÇ°JOÇ°BTTFUTÇ°GSPNÇ°ĹłOBODFÇ°MFBTFÇ°BHSFFNFOUTÇ° Ç° Investment in associate which payment has yet to be made Disposal of invesment in subsidiaries which receipt has yet to be made Investment in subsidiaries which payment has yet to be made The accompanying notes are an integral part of the financial statements.

1,220,246,425 142,789,741 (287,024,163)    Ç° (63,944,190) 1,060,529,890 2,051,412,702 (1,339,716) 808,211,253 844,857,204 1,653,068,457 -

1,854,478,551 235,122,000 (147,418,865)    Ç° (84,288,024) 1,831,195,099 356,523 (171,365,944) 1,016,223,148 844,857,204 -

  Ç°Ç° -

14,618,139   Ç° -

1,674,000,000 112,000,000 1,363,000,000 84,222,000 (280,000,000)    Ç°   

1,060,529,890 3,810,737,830 183,502,291 723,473,326 (12,722,846) 139,996,047 152,718,893 863,469,373 139,996,047 -

7,189,160   Ç° 5,000,000 (1,509,994) 19,509,500

   -


100

ANNUAL REPORT 2013

GMM GRAMMY

1. General information

Ç°

Ç°

1.1 GMM Grammy Public Company Limited (“the Companyâ€?) is a public company incorporated and domiciled in Thailand. GMM Grammy Public Company Limited, its subsidiaries and its jointly controlled entities (together “the Groupâ€?) are principally engaged in various entertainment businesses, including music business, media business, broadcasting business, marketing Ç° FWFOUTÇ°CVTJOFTT Ç°BOEÇ°PUIFSÇ°FOUFSUBJONFOUÇ°CVTJOFTTFTÇ°5IFÇ°SFHJTUFSFEÇ°PGĹłDFÇ°PGÇ°UIFÇ°$PNQBOZÇ°JTÇ°BUÇ°Ç°4VLIVNWJUÇ°Ç° "TPLF Ç° Klongtoey Nua, Wattana, Bangkok. 1.2 The National Broadcasting and Telecommunications Commission (“the NBTCâ€?) arranged an auction for 24 frequency licenses for use in the broadcasting of commercial Digital Terrestrial Television (“DTTâ€?) during 26 - 27 December 2013. The frequencies could accommodate a total of 24 digital terrestrial television channels, dividing into 3 Children and Family channels, 7 News Ç° DIBOOFMT Ç°Ç°7BSJFUZÇ°JOÇ°4UBOEBSEÇ°%FĹłOJUJPOÇ° Äś7BSJFUZ4%ġ Ç°DIBOOFMTÇ°BOEÇ°Ç°7BSJFUZÇ°JOÇ°)JHIÇ°%FĹłOJUJPOÇ° Äś7BSJFUZ)%ġ Ç°DIBOOFMTÇ° The Group participated in the auction and won 2 licenses. GMM SD Digital TV Company Limited, a subsidiary, won digital TV spectrum license auction for Variety-SD, and GMM HD Digital TV Company Limited, another subsidiary, won digital TV spectrum license auction for Variety-HD. The subsidiaries were required to make payment for the bid price of Baht 2,290 million and Baht 3,320 million (exclusive of VAT) under the following payment conditions:

Ç°

Ç°

1.2.1 Payment for the minimum bid price of the license fee amounting to Baht 380 million (Variety-SD) and Baht 1,510 million (Variety-HD), divided into 4 installments and has to be made within 3 years from the date of obtaining the Ç° MJDFOTFÇ°BTÇ°TQFDJĹłFEÇ°CZÇ°UIFÇ°/#5$

Ç°

Ç°

1.2.2 For the exceeding amount of the minimum bid price of the license fee, the payment is divided into 6 installments Ç° BOEÇ°IBTÇ°UPÇ°CFÇ°NBEFÇ°XJUIJOÇ°Ç°ZFBSTÇ°GSPNÇ°UIFÇ°EBUFÇ°PGÇ°PCUBJOJOHÇ°UIFÇ°MJDFOTFÇ°BTÇ°TQFDJĹłFEÇ°CZÇ°UIFÇ°/#5$

Ç°

Ç°

'VSUIFSNPSF Ç°BDDPSEJOHÇ°UPÇ°UIFÇ°OPUJĹłDBUJPOÇ°PGÇ°UIFÇ°/#5$Ç°BOEÇ°SFMBUFEÇ°MBXT Ç°UIFÇ°TVCTJEJBSJFTÇ°IBWFÇ°BÇ°EVUZÇ°UPÇ°QBZÇ°MJDFOTFÇ°BOEÇ° other fees, and deposit an annual due to the Fund of Broadcasting and Telecommunications Research and Development Fund for Public Interest.

Ç°

Ç°

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2. Basis of preparation Ç° Ç°

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2.2 Basis of consolidation Ç°

Ç°

B Ç°

5IFÇ°DPOTPMJEBUFEÇ°ĹłOBODJBMÇ°TUBUFNFOUTÇ°JODMVEFÇ°UIFÇ°ĹłOBODJBMÇ°TUBUFNFOUTÇ°PGÇ°(..Ç°(SBNNZÇ°1VCMJDÇ°$PNQBOZÇ°-JNJUFEÇ°Ç° (“the Companyâ€?) and the following subsidiary companies (“the subsidiariesâ€?) and jointly controlled entities (“jointly controlled entitiesâ€?):


101

Company’s name

Subsidiaries directly held by the Company 1. GMM Media Public Company Limited 2. GMM Holding Company Limited 3. GMM Music Publishing International Company Limited Ç° (..Ç°5BJÇ°)VCÇ°$PNQBOZÇ°-JNJUFEÇ° 5. Fan TV Company Limited (Held 49 percent by GMM Holding Company Limited, a subsidiary) 6. 3-RD Company Limited

Nature of business

Country of incorporation

Production of radio programmes Holding company Management of music copyrights

Thailand Thailand Thailand

99.92 100 100

99.92 100 100

1SPEVDUJPOÇ°PGÇ°ĹłMNTÇ°BOEÇ°UFMFWJTJPOÇ°Ç° programmes Production of satellite television programmes

5IBJMBOEÇ°

Ç°

Ç°

Thailand

51

51

Thailand

70

70

Thailand 5IBJMBOEÇ°

100 Ç°

100 Ç°

Thailand Thailand Thailand Thailand Thailand

100 100 100 100 100

100 100 100 100 100

Thailand

100

-

Thailand

100

-

Thailand

100

-

Thailand

51

-

Thailand

50

-

Thailand

100

-

Thailand Thailand Thailand

100 100 100

100 100 100

Providing customer service via telephone 7. GR Vocal Studio Company Limited Vocal and music schools ǰ (..ǰ$+ǰ0ǰ4IPQQJOHǰ$PNQBOZǰ-JNJUFEǰ 8IPMFTBMFǰBOEǰSFUBJMǰCZǰVTJOHǰ advertising media and receiving phone orders 9. MGA Company Limited Currently non-active 10. Digital Gen Company Limited Currently non-active 11. Extraorganizer Company Limited Currently non-active 12. More Music Company Limited Currently non-active 13. GDC Company Limited Providing service to games members, distribution of games playing cards 14. GMM Z Trading Company Limited (2012: Held 100 Production and distribution of percent by GMM Z Company Limited) satellite television receivers 15. GMM SD Digital TV Trading Company Limited Production of television programmes and digital on-air 16. GMM HD Digital TV Trading Company Limited Production of television programmes and digital on-air 17. The News TV Company Limited (2012: Held 51 Currently non-active percent by GMM Z Company Limited) 18. STGMM Company Limited (2012: Held 50 Production of satellite television percent by GMM Z Company Limited) programmes 19. Digistream Company Limited (Formerly known as Providing music in streaming “Bang Channel Company Limited� 2012: Held 100 percent by GMM Z Company Limited) Subsidiaries held by GMM Media Public Company Limited 1. A-Time Media Company Limited 2. GMM TV Company Limited 3. Teen Talk Company Limited

Sub - lease of radio stations Production of television programmes Motion graphic and multimedia service

Percentage of shareholding 2013 2012 Percent Percent


102

ANNUAL REPORT 2013

GMM GRAMMY

Company’s name

Nature of business

Country of incorporation

Production and distribution of pocket books Production and distribution of magazine Production of television programmes Production and distribution of magazine Production and distribution of magazine Production of television programmes Business events advisor and organizer Production and distribution of magazine Currently non-active

Thailand

100

100

Thailand

70

70

Thailand Thailand

100 70

100 70

Thailand

70

70

Thailand Thailand Thailand

100 50 70

100 50 70

Thailand

100

100

Subsidiary held by A-Time Media Company Limited 1. A Gen Event Agency Company Limited Business events advisor and organizer

Thailand

70

70

Subsidiary held by GMM TV Company Limited 1. Me Miti Company Limited

Thailand

70

70

Thailand

100

100

Thailand

50

50

4. Bliss Publishing Company Limited 5. Image Publishing Company Limited 6. Exact Company Limited 7. GMM Inter Publishing Company Limited 8. GMM Times Company Limited 9. Deetalk Company Limited 10. Index Creative Village Public Company Limited 11. In Publishing Company Limited 12. Radio Concept Company Limited

Production of television programmes

Subsidiary held by Image Publishing Company Limited 1. Image On Air Company Limited Currently non-active Subsidiary held by Exact Company Limited 1. Acts Studio Company Limited (Held 50 percent Lease of studio by Scenario Company Limited, an associate)

Percentage of shareholding 2013 2012 Percent Percent

Subsidiaries held by GMM Holding Company Limited 1. GMM Studio Company Limited 2. Grammy Publishing House Company Limited 3. GMM Fitness Club Company Limited 4. Mifah Company Limited 5. GMM Digital Domain Company Limited 6. Magic Film Company Limited 7. Global Music and Media (China) Limited

Studio service Thailand Distribution of education publication Thailand Currently non-active Thailand Currently non-active Thailand Currently non-active Thailand Currently non-active Thailand Currently non-active Hong Kong SAR

100 100 100 100 100 90.91 100

100 100 100 100 100 90.91 100

Subsidiary held by GMM Digital Domain Company Limited 1. Digital Arms Company Limited

Currently non-active

Thailand

100

100

Thailand ǰ

100 ǰ

100 ǰ

Subsidiaries held by GMM Tai Hub Company Limited 1. Luckdee Thaweesuk Company Limited Design and post production of ǰ 'PSNFSMZǰLOPXOǰBTǰĶ4BXBTEFFǰ5IBXFFTVLǰ BEWFSUJTJOHǰNFEJBǰBOEǰųMNTǰBOEǰ ǰ $PNQBOZǰ-JNJUFEķ ǰ QVCMJDǰSFMBUJPOTǰGPSǰųMNTǰ


103

Company’s name

Nature of business

2. GTH On Air Company Limited (Held 30 percent Production of satellite television by the Company and held 20 percent by Image programmes Publishing Company Limited, a subsidiary) 3. Good Things Happen Company Limited Provide advertising media, public relations consulting, and organize Subsidiary held by GTH On Air Company Limited Ç° +Ç°,Ç°/FUXPSLÇ°$PNQBOZÇ°-JNJUFEÇ°

50

50

Thailand

51

-

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Ç°

Ç°

Thailand

100

-

Thailand

100

-

Thailand

100

-

Thailand

-

100

Thailand

-

100

Production of television programmes and digital on-air

Thailand

100

-

Production of television programmes and digital on-air

Thailand

100

-

Provision of equipment for entertainment events Decoration and provision of equipment for conferences and ceremonial events Light and sound system installation services for entertainment events

Thailand

100

100

Thailand

100

100

Thailand

51

51

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Subsidiaries held by GMM Z Company Limited 1. GMM Digital TV Company Limited (Formerly Deregistered known as “Green Channel Company Limited�) 2. Maxxi TV Company Limited Deregistered

Subsidiary held by GMM HD Digital TV Trading Company Limited 1. GMM HD Digital TV Company Limited Subsidiaries held by Index Creative Village Public Company Limited 1. Event Solutions Company Limited 2. Tresbien Company Limited 3. Media Vision (1994) Company Limited

Percentage of shareholding 2013 2012 Percent Percent

Thailand

Subsidiaries held by GMM Z Trading Company Limited 1. G S-one Company Limited Currently non-active (2012: Held 50 percent by the Company and 50 percent by GMM Media Public Company Limited, a subsidiary) 2. GMM Z Company Limited Service provider (2012: Held 100 percent by the Company) 3. GMM B Company Limited (2012: Held 100 Pay-TV services percent by GMM Z Company Limited)

Subsidiary held by GMM SD Digital TV Trading Company Limited 1. GMM SD Digital TV Company Limited

Country of incorporation


104

ANNUAL REPORT 2013

GMM GRAMMY

Company’s name

4. G Communications Company Limited 5. Inspire Image Company Limited 6. I Think Ad Company Limited 7. D-63 Company Limited 8. Index Creative Online Company Limited Ç° Ç° Ç° Ç° Ç° 9. Envirosell (Thailand) Company Limited 10. Index and M Company Limited 11. Index and V Company Limited Ç°+PJOUÇ°7FOUVSFÇ°*OEFYÇ°%Ç° (Held 37 percent by D-63 Company Limited)

Nature of business

Country of incorporation

Provision of public relations and event services Preparation, installation and removal of advertising boards Advertising and public relations services Service provider of design screen and stage Consultancy, design and development services for web TJUFTÇ°BOEÇ°Ĺ´BTIÇ°NFEJB Provide advisory services, research data analysis and survey of statistic Business events advisor and organizer Business events advisor and organizer %FTJHOÇ°BOEÇ°.BOBHFNFOUÇ°PGÇ°Ç° Exhibition Building

Thailand

50

50

Thailand

60

60

Thailand

40

40

Thailand

50

50

Thailand

70

70

Thailand

60

60

Thailand

50

50

Thailand

50

50

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Ç°

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United Arab Emirates

50

50

Karaoke service and rental

Thailand

50

50

$POTUSVDUJPOÇ°%FTJHOÇ°BOEÇ° Management of Thai Exhibition Building 1SPWJEFSÇ°PGÇ°DPOUSBDUPS Ç°*OTUBMMBUJPO Ç° exhibition and display materials for Siriraj Museum %FTJHOÇ°BOEÇ°.BOBHFNFOUÇ°PGÇ° exhibition building in Yeosu International Exposition 2012 %FTJHOÇ°BOEÇ°.BOBHFNFOUÇ°PGÇ° exhibition building in Universal Exhibition Milano 2015

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Subsidiary held by Event Solutions Company Limited 1. Aspen Index Event Company Limited Currently non-active +PJOUMZÇ°DPOUSPMMFEÇ°FOUJUZÇ°IFMEÇ°CZÇ°UIFÇ°$PNQBOZ 1. K Arena Company Limited +PJOUMZÇ°DPOUSPMMFEÇ°FOUJUJFTÇ°IFMEÇ°CZÇ°*OEFYÇ°$SFBUJWF Village Public Company Limited Ç° +PJOUÇ°7FOUVSFÇ°*%Ç° Ç° +PJOUÇ°7FOUVSFÇ°*OEFYÇ°$JUZOFPOÇ° Ç° +PJOUÇ°7FOUVSFÇ°*OEFYÇ°%Ç°.BDPÇ° Ç° +PJOUÇ°7FOUVSFÇ°*OEFYÇ°%Ç°

Percentage of shareholding 2013 2012 Percent Percent


105

ǰ

ǰ

b)

Subsidiaries are fully consolidated, being the date on which the Company obtains control, and continue to be consolidated until the date when such control ceases.

D ǰ

+PJOUMZǰDPOUSPMMFEǰFOUJUJFTǰBSFǰGVMMZǰDPOTPMJEBUFEǰBQQMZJOHǰUIFǰQSPQPSUJPOBUFǰDPOTPMJEBUJPOǰNFUIPEǰBTǰGSPNǰCFJOHǰUIFǰ date on which the Company assumed joint control, and continue to be consolidated until the date when such control ceases.

d)

During the year 2013, there were the following changes in the composition of the subsidiaries and jointly controlled entities:

Newly established subsidiaries and joint venture Investors Subsidiaries

Nature of business

Percentage of shareholding (%)

Description

999,997 ordinary shares of Baht 100 each (9,997 ordinary shares of Baht 100 each, fully called up and 990,000 ordinary shares, called up 25 percent) 1,999,997 ordinary shares of Baht 100 each (9,997 ordinary shares of Baht 100 each, fully called up and 1,990,000 ordinary shares, called up 25 percent) 999,997 ordinary shares of Baht 100 each (9,997 ordinary shares of Baht 100 each, fully called up and 990,000 ordinary shares, called up 25 percent) 1,999,997 ordinary shares of Baht 100 each (9,997 ordinary shares of Baht 100 each, fully called up and 1,990,000 ordinary shares, called up 25 percent) *OEFYǰ$SFBUJWFǰ7JMMBHFǰ Public Company Limited and D-63 Company Limited invested 63% and 37%, respectively. 25,498 ordinary shares of Baht 100 each

GMM Grammy Public Company Limited

GMM SD Digital TV Trading Company Limited

Production of television programmes and digital on-air

100

GMM Grammy Public Company Limited

GMM HD Digital TV Trading Company Limited

Production of television programmes and digital on-air

100

GMM SD Digital TV Trading Company Limited

GMM SD Digital TV Company Limited

Production of television programmes and digital on-air

100

GMM HD Digital TV Trading Company Limited

GMM HD Digital TV Company Limited

Production of television programmes and digital on-air

100

*OEFYǰ$SFBUJWFǰ7JMMBHFǰ1VCMJDǰ$PNQBOZǰ +PJOUǰ7FOUVSFǰ*OEFYǰ%ǰ Limited and D-63 Company Limited, which are the subsidiaries

%FTJHOǰBOEǰ.BOBHFNFOUǰ of Exhibition Building

ǰ

GMM Tai Hub Company Limited

Provide advertising media, public relations consulting, and organizer

51

Good Things Happen Company Limited

Amount (Thousand Baht) 25,750

50,750

25,750

50,750

ǰ

2,550


106

ANNUAL REPORT 2013

GMM GRAMMY

Newly established jointly controlled entity Investor Jointly controlled entity

Nature of business

Percentage of

Description

shareholding

(%) *OEFYÇ°$SFBUJWFÇ°7JMMBHFÇ°1VCMJDÇ° Company Limited

+PJOUÇ°7FOUVSFÇ°*OEFYÇ°%Ç°

%FTJHOÇ°BOEÇ°.BOBHFNFOUÇ°PGÇ° exhibition building in Universal Exhibition Milano 2015

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)BEÇ°OPUÇ°ZFUÇ°DBMMVQÇ° investment

Deregistered subsidiaries Shareholders

Subsidiaries

Percentage of

Description

shareholding

(%) GMM Z Company Limited GMM Z Company Limited

Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç°

Ç°

GMM Digital TV Company Limited (Formerly known as “Green Channel Company Limited�) Maxxi TV Company Limited

100

Deregistered with the Ministry of Commerce on 12 December 2013

100

Deregistered with the Ministry of Commerce on 12 December 2013

F Ç°

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3. New accounting standards Below is a summary of accounting standards that became effective in the current accounting year and those that will become effective in the future. B Ç°"DDPVOUJOHÇ°TUBOEBSETÇ°UIBUÇ°CFDBNFÇ°FGGFDUJWFÇ°JOÇ°UIFÇ°DVSSFOUÇ°BDDPVOUJOHÇ°ZFBS Accounting standards: TAS 12 Income Taxes TAS 20 (revised 2009) Accounting for Government Grants and Disclosure of Government Assistance TAS 21 (revised 2009) The Effects of Changes in Foreign Exchange Rates Financial Reporting Standard: TFRS 8 Operating Segments


107

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Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç°

Accounting Standard Interpretations: ǰ 54*$ǰǰǰ ǰ ǰ ǰ (PWFSONFOUǰ"TTJTUBODFǰǰ/Pǰ4QFDJųDǰ3FMBUJPOǰUPǰ0QFSBUJOHǰ"DUJWJUJFT TSIC 21 Income Taxes - Recovery of Revalued Non-Depreciable Assets TSIC 25 Income Taxes - Changes in the Tax Status of an Entity or its Shareholders Accounting Treatment Guidance for Transfers of Financial Assets 5IFTFǰBDDPVOUJOHǰTUBOEBSET ǰųOBODJBMǰSFQPSUJOHǰTUBOEBSE ǰBDDPVOUJOHǰTUBOEBSEǰJOUFSQSFUBUJPOTǰBOEǰBDDPVOUJOHǰUSFBUNFOUǰHVJEBODFǰ EPǰOPUǰIBWFǰBOZǰTJHOJųDBOUǰJNQBDUǰPOǰUIFǰųOBODJBMǰTUBUFNFOUT ǰFYDFQUǰGPSǰUIFǰGPMMPXJOHǰBDDPVOUJOHǰTUBOEBSE 5"4ǰǰ*ODPNFǰ5BYFTǰ This accounting standard requires an entity to identify temporary differences between the carrying amount of an asset or liability in UIFǰTUBUFNFOUǰPGǰųOBODJBMǰQPTJUJPOǰBOEǰJUTǰUBYǰCBTFǰBOEǰSFDPHOJTFǰUIFǰUBYǰFGGFDUTǰBTǰEFGFSSFEǰUBYǰBTTFUTǰPSǰMJBCJMJUJFTǰTVCKFDUJOHǰUPǰ DFSUBJOǰSFDPHOJUJPOǰDSJUFSJBǰ5IFǰ(SPVQǰIBWFǰDIBOHFEǰUIJTǰBDDPVOUJOHǰQPMJDZǰJOǰUIJTǰDVSSFOUǰZFBSǰBOEǰSFTUBUFEǰUIFǰQSJPSǰZFBSĴTǰųOBODJBMǰ statements, presented as comparative information, as though the Group had initially recognised the tax effects as deferred tax assets PSǰMJBCJMJUJFTǰ5IFǰDVNVMBUJWFǰFGGFDUǰPGǰUIJTǰDIBOHFǰJOǰBDDPVOUJOHǰQPMJDZǰIBTǰCFFOǰQSFTFOUFEǰJOǰ/PUFǰǰUPǰUIFǰųOBODJBMǰTUBUFNFOUT C ǰ"DDPVOUJOHǰTUBOEBSETǰUIBUǰXJMMǰCFDPNFǰFGGFDUJWFǰJOǰUIFǰGVUVSF Effective date Accounting Standards: ǰ 5"4ǰǰ SFWJTFEǰ ǰǰ ǰ 1SFTFOUBUJPOǰPGǰ'JOBODJBMǰ4UBUFNFOUTǰ ǰ+BOVBSZǰ ǰ 5"4ǰǰ SFWJTFEǰ ǰǰ ǰ 4UBUFNFOUǰPGǰ$BTIǰ'MPXTǰ ǰ+BOVBSZǰ ǰ 5"4ǰǰ SFWJTFEǰ ǰǰ ǰ *ODPNFǰ5BYFTǰ ǰ+BOVBSZǰ ǰ 5"4ǰǰ SFWJTFEǰ ǰǰ ǰ -FBTFTǰ ǰ+BOVBSZǰ ǰ 5"4ǰǰ SFWJTFEǰ ǰǰ ǰ 3FWFOVFǰ ǰ+BOVBSZǰ ǰ 5"4ǰǰ SFWJTFEǰ ǰ ǰ &NQMPZFFǰ#FOFųUTǰ ǰ+BOVBSZǰ ǰ 5"4ǰǰ SFWJTFEǰ ǰ ǰ 5IFǰ&GGFDUTǰPGǰ$IBOHFTǰJOǰ'PSFJHOǰ&YDIBOHFǰ3BUFTǰ ǰ+BOVBSZǰ ǰ 5"4ǰǰ SFWJTFEǰ ǰ ǰ 3FMBUFEǰ1BSUZǰ%JTDMPTVSFTǰ ǰ+BOVBSZǰ ǰ 5"4ǰǰ SFWJTFEǰ ǰ ǰ *OWFTUNFOUTǰJOǰ"TTPDJBUFTǰ ǰ+BOVBSZǰ ǰ 5"4ǰǰ SFWJTFEǰ ǰ ǰ *OUFSFTUTǰJOǰ+PJOUǰ7FOUVSFTǰ ǰ+BOVBSZǰ ǰ 5"4ǰǰ SFWJTFEǰ ǰ ǰ *OUFSJNǰ'JOBODJBMǰ3FQPSUJOHǰ ǰ+BOVBSZǰ ǰ 5"4ǰǰ SFWJTFEǰ ǰ ǰ *NQBJSNFOUǰPGǰ"TTFUTǰ ǰ+BOVBSZǰ ǰ 5"4ǰǰ SFWJTFEǰ ǰ ǰ *OUBOHJCMFǰ"TTFUTǰ ǰ+BOVBSZǰ Financial Reporting Standards: ǰ 5'34ǰǰ SFWJTFEǰ ǰ ǰ 4IBSFCBTFEǰ1BZNFOUǰ ǰ+BOVBSZǰ ǰ 5'34ǰǰ SFWJTFEǰ ǰ ǰ #VTJOFTTǰ$PNCJOBUJPOTǰ ǰ+BOVBSZǰ ǰ 5'34ǰǰǰ ǰ ǰ ǰ ǰ *OTVSBODFǰ$POUSBDUTǰ ǰ+BOVBSZǰ ǰ 5'34ǰǰ SFWJTFEǰ ǰ ǰ /PODVSSFOUǰ"TTFUTǰ)FMEǰGPSǰ4BMFǰBOEǰ%JTDPOUJOVFEǰ0QFSBUJPOTǰ ǰ+BOVBSZǰ ǰ 5'34ǰǰ SFWJTFEǰ ǰ ǰ 0QFSBUJOHǰ4FHNFOUTǰ ǰ+BOVBSZǰ Accounting Standard Interpretations: ǰ 54*$ǰǰǰ ǰ ǰ ǰ ǰ 0QFSBUJOHǰ-FBTFTǰǰ*ODFOUJWFTǰ ǰ+BOVBSZǰ ǰ 54*$ǰǰǰ ǰ ǰ ǰ ǰ &WBMVBUJOHǰUIFǰ4VCTUBODFǰPGǰ5SBOTBDUJPOTǰ*OWPMWJOHǰUIFǰ-FHBMǰǰ ǰ+BOVBSZǰǰ Form of a Lease ǰ 54*$ǰǰǰ ǰ ǰ ǰ ǰ 4FSWJDFǰ$PODFTTJPOǰ"SSBOHFNFOUTǰ%JTDMPTVSFTǰ ǰ+BOVBSZǰ ǰ 54*$ǰǰǰ ǰ ǰ ǰ ǰ *OUBOHJCMFǰ"TTFUTǰǰ8FCǰ4JUFǰ$PTUTǰ ǰ+BOVBSZǰ Financial Reporting Standard Interpretations: ǰ 5'3*$ǰǰǰ ǰ ǰ ǰ ǰ $IBOHFTǰJOǰ&YJTUJOHǰ%FDPNNJTTJPOJOH ǰ3FTUPSBUJPOǰBOEǰ4JNJMBSǰ-JBCJMJUJFTǰ ǰ+BOVBSZǰ ǰ 5'3*$ǰǰǰ ǰ ǰ ǰ ǰ %FUFSNJOJOHǰXIFUIFSǰBOǰ"SSBOHFNFOUǰDPOUBJOTǰBǰ-FBTFǰ ǰ+BOVBSZǰ ǰ 5'3*$ǰǰǰ ǰ ǰ ǰ ǰ 3JHIUTǰUPǰ*OUFSFTUTǰBSJTJOHǰGSPNǰ%FDPNNJTTJPOJOH ǰ3FTUPSBUJPOǰBOEǰ ǰ+BOVBSZǰǰ Environmental Rehabilitation Funds ǰ 5'3*$ǰǰ ǰ ǰ ǰ ǰ "QQMZJOHǰUIFǰ3FTUBUFNFOUǰ"QQSPBDIǰVOEFSǰ5"4ǰǰ'JOBODJBMǰ3FQPSUJOHǰJOǰǰ ǰ+BOVBSZǰǰ ǰ ǰ ǰ ǰ ǰ ǰ ǰ )ZQFSJOŴBUJPOBSZǰ&DPOPNJFT


108

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ANNUAL REPORT 2013

GMM GRAMMY

ǰ 5'3*$ǰǰǰ ǰ ǰ ǰ ǰ *OUFSJNǰ'JOBODJBMǰ3FQPSUJOHǰBOEǰ*NQBJSNFOUǰ ǰ+BOVBSZǰ ǰ 5'3*$ǰǰ ǰ ǰ ǰ ǰ 4FSWJDFǰ$PODFTTJPOǰ"SSBOHFNFOUTǰ ǰ+BOVBSZǰ ǰ 5'3*$ǰǰ ǰ ǰ ǰ ǰ $VTUPNFSǰ-PZBMUZǰ1SPHSBNNFTǰ ǰ+BOVBSZǰ ǰ 5'3*$ǰǰ ǰ ǰ ǰ ǰ %JTUSJCVUJPOTǰPGǰ/PODBTIǰ"TTFUTǰUPǰ0XOFSTǰ ǰ+BOVBSZǰ ǰ 5'3*$ǰǰ ǰ ǰ ǰ ǰ 5SBOTGFSTǰPGǰ"TTFUTǰGSPNǰ$VTUPNFSTǰ ǰ+BOVBSZǰ 5IFǰ(SPVQĴTǰNBOBHFNFOUǰCFMJFWFTǰUIBUǰUIFTFǰBDDPVOUJOHǰTUBOEBSET ǰųOBODJBMǰSFQPSUJOHǰTUBOEBSE ǰBDDPVOUJOHǰTUBOEBSEǰJOUFSQSFUBUJPOTǰ BOEǰųOBODJBMǰSFQPSUJOHǰTUBOEBSETǰJOUFSQSFUBUJPOTǰXJMMǰOPUǰIBWFǰBOZǰTJHOJųDBOUǰJNQBDUǰPOǰUIFǰųOBODJBMǰTUBUFNFOUTǰGPSǰUIFǰZFBSǰXIFOǰ they are initially applied

4. Cumulative effect of changes in accounting policies due to the adoption of new accounting standard Ç° Ç°

%VSJOHǰUIFǰDVSSFOUǰZFBS ǰUIFǰ(SPVQǰNBEFǰUIFǰDIBOHFTǰEFTDSJCFEǰJOǰ/PUFǰǰUPǰUIFǰųOBODJBMǰTUBUFNFOUTǰUPǰJUTǰTJHOJųDBOUǰBDDPVOUJOHǰ policies, as a result of the adoption of Thai Accounting Standard 12 Income Taxes. The cumulative effect of the changes in the accounting policies has been separately presented in the statements of changes in shareholders’ equity. 5IFǰBNPVOUTǰPGǰBEKVTUNFOUTǰBGGFDUJOHǰUIFǰTUBUFNFOUTǰPGǰųOBODJBMǰQPTJUJPOǰBOEǰUIFǰTUBUFNFOUTǰPGǰDPNQSFIFOTJWFǰJODPNFǰBSFǰ summarised below. (Unit: Thousand Baht) As at 31 December 2013 As at 31 December 2012 As at 1 January 2012 Consolidated financial statements

ǰ 4UBUFNFOUTǰPGǰųOBODJBMǰQPTJUJPOǰ Increase in investments in associates Increase in deferred tax assets Increase in deferred tax liabilities Increase in non-controlling interests of the subsidiaries Increase in unappropriated retained earnings Decrease in other components of shareholders’ equity

Separate financial statements

Consolidated financial statements

Separate financial statements

Consolidated financial statements

Separate financial statements

960 242,152 14,506

109,872 14,491

847 155,562 80,730

62,865 80,544

528 118,081 48,914

57,144 48,841

39,185 203,912

109,872

21,833 134,390

62,865

9,560 108,976

57,144

(14,491)

(14,491)

(80,544)

(80,544)

(48,841)

(48,841)

(Unit: Thousand Baht)

For the year ended 31 December 2013 Consolidated financial statements

Ç° *ODPNFÇ°TUBUFNFOUT Ç° *ODSFBTFÇ°JOÇ°TIBSFÇ°PGÇ°QSP��³UÇ°GSPNÇ°JOWFTUNFOUTÇ°JOÇ°BTTPDJBUFTÇ° Decrease in income tax expenses Ç° *ODSFBTFÇ°JOÇ°QSPųUÇ°BUUSJCVUBCMFÇ°UPÇ°OPODPOUSPMMJOHÇ°JOUFSFTUÇ°PGÇ°UIFÇ°TVCTJEJBSJFTÇ° Ç° *ODSFBTFÇ°JOÇ°QSPųUÇ°BUUSJCVUBCMFÇ°UPÇ°FRVJUZÇ°IPMEFSTÇ°PGÇ°UIFÇ°$PNQBOZÇ° Increase in basic earnings per share (Baht) 4UBUFNFOUTÇ°PGÇ°DPNQSFIFOTJWFÇ°JODPNF Increase in actuarial gains (losses) Increase (decrease) in gain (losses) on changes in value of available-for-sale investments

Separate financial statements

For the year ended 31 December 2012 Consolidated financial statements

Separate financial statements

Ç° (78,522)  Ç°  Ç° 0.11

Ç° (45,600) Ç°  Ç° 0.08

Ç° (37,368)  Ç°  Ç° 0.05

 (5,722)    0.01

8,239

1,407

-

-

66,053

66,053

(31,703)

(31,703)


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5. Significant accounting policies

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Ç° 3FWFOVFÇ°SFDPHOJUJPO Sales of goods 4BMFTÇ°PGÇ°HPPETÇ°BSFÇ°SFDPHOJTFEÇ°XIFOÇ°UIFÇ°TJHOJĹłDBOUÇ°SJTLTÇ°BOEÇ°SFXBSETÇ°PGÇ°PXOFSTIJQÇ°PGÇ°UIFÇ°HPPETÇ°IBWFÇ°QBTTFEÇ°UPÇ°UIFÇ°CVZFSÇ°4BMFTÇ°BSFÇ° the invoiced value, excluding value added tax, of goods supplied after deducting discounts and allowances. Revenues from services a) Revenues from production of radio, television and satellite television programmes Revenues from production of radio, television and satellite television programmes represent the service income from advertising, promotion and production of television programmes and are stated on the basis of the invoiced value, after deducting discounts and allowances. Service income from advertising and promotion is recognised when services have been rendered on radio, television and satellite television programmes. Service income from production of television programmes is recognised when the production is completed. b) Revenues from production of concerts Revenues from production of concerts are recognised as income when the performances take place. c) Revenues from production of motion pictures Ç° *ODPNFÇ°GSPNÇ°CPYPGĹłDFÇ°TIBSJOHÇ°JTÇ°SFDPHOJTFEÇ°BTÇ°JODPNFÇ°XIFOÇ°UIFÇ°NPUJPOÇ°QJDUVSFTÇ°IBWFÇ°CFFOÇ°FYIJCJUFEÇ° Ç° 4BMFTÇ°PGÇ°NPUJPOÇ°QJDUVSFTÇ°BOEÇ°BEWFSUJTJOHÇ°JODPNFÇ°BSFÇ°UIFÇ°JOWPJDFEÇ°WBMVFÇ°PGÇ°UIFÇ°ĹłMNTÇ°EFMJWFSFEÇ°BOEÇ°UIFÇ°TFSWJDFTÇ°SFOEFSFEÇ°BGUFSÇ° deducting discounts and allowances. Ç° *OÇ°DBTFTÇ°XIFSFÇ°SPZBMUJFTÇ°GSPNÇ°NPUJPOÇ°QJDUVSFTÇ°BSFÇ°DIBSHFEÇ°BUÇ°ĹłYFEÇ°BNPVOUTÇ°XIJDIÇ°UIFÇ°MJDFOTFFÇ°DBOOPUÇ°SFGVOEÇ°BOEÇ°UIFÇ°MJDFOTPSÇ°IBTÇ°OPÇ° further obligations subsequent to granting the rights, the royalties are recognised as income in full when the licensee is entitled to exploit the rights under the terms of the agreement. d) Revenues from advertising in publishing media Revenues from advertising in publishing media are recognised as income when services have been rendered. e) Management fee and consultant fee income Management fee and consultant fee income are recognised when services have been rendered. f) Artist management income Artist management income is recognised when services have been rendered. g) Revenues from studio service Revenues from studio service are recognised when services have been rendered taking into account the stage of completion. h) Revenues from event advisor and organizer and provision of event equipment Revenues from event advisor and organizer and provision of event equipment are recognised when services have been rendered taking into account the stage of completion. i) Revenues from production and service Revenues from production and service are recognised when services have been rendered taking into account the stage of completion. j) Revenues from Pay-TV service Revenues from Pay-TV service are recognised base on service period. Revenues from copyrights Revenues from copyrights are recognised when the right to receive payment is established, and reasonable estimates of such amount can be made. Interest income Interest income is recognised on an accrual basis based on the effective interest rate. Dividend received Dividend received is recognised when the right to receive the dividends is established. 3FWFOVFTÇ°BSFÇ°SFĹ´FDUFEÇ°JOÇ°UIFÇ°ĹłOBODJBMÇ°TUBUFNFOUTÇ°FYDMVTJWFÇ°PGÇ°WBMVFÇ°BEEFEÇ°UBYÇ°


110

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ANNUAL REPORT 2013

GMM GRAMMY

5.2 Cash and cash equivalents Cash and cash equivalents consist of cash on hand and at banks, and all highly liquid investments with an original maturity of three months or less and not subject to withdrawal restrictions. 5.3 Trade accounts receivable Trade accounts receivable are stated at the net realisable value. Allowance for doubtful accounts is provided for the estimated loss that may be incurred in collection of receivables. The allowance is generally based on collection experience and analysis of debt aging. 5.4 Inventories a) Tape reels, cassette tapes, compact discs, video compact discs and digital versatile discs are valued at the lower of cost (moving average method) and net realisable value. b) Television programmes and satellite television programmes represent the accumulated production costs in progress and those which are completed and ready for broadcasting. The costs, which consist of expenses directly associated with programme production, are charged against income when the programmes are broadcasted. c) Master tapes represent the accumulated costs of master tape production in progress and which has been completed. The costs, consisting of expenses directly associated with production, are charged against income when albums are launched for sale, except for cost of lyrics, melodies and compositions that are transferred to be the intangible asset subjected as “the copyrights to musical compositionsâ€?. E Ç° .PUJPOÇ°QJDUVSFÇ°BOEÇ°DBSUPPOÇ°QSPEVDUJPOÇ°SFQSFTFOUTÇ°UIFÇ°BDDVNVMBUFEÇ°QSPEVDUJPOÇ°BOEÇ°ĹłMNJOHÇ°DPTUTÇ°XIJDIÇ°BSFÇ°DVSSFOUMZÇ°JOÇ°QSPEVDUJPO Ç° and is transferred to be the intangible asset subjected as “motion picture and cartoon copyrightsâ€? when they are exhibited. e) Magazines and pocket books are valued at the lower of cost (average method) and net realisable value. f) Satellite television receivers are valued at the lower of cost (moving average method) and net realisable value. H Ç° 0UIFSÇ°JOWFOUPSJFTÇ°BSFÇ°WBMVFEÇ°BUÇ°UIFÇ°MPXFSÇ°PGÇ°DPTUÇ° ĹłSTUJO Ç°ĹłSTUPVUÇ°BOEÇ°BWFSBHFÇ°NFUIPE Ç°BOEÇ°OFUÇ°SFBMJTBCMFÇ°WBMVF Ç° *OWFTUNFOUTÇ° B Ç° *OWFTUNFOUTÇ°JOÇ°TFDVSJUJFTÇ°IFMEÇ°GPSÇ°USBEJOHÇ°BSFÇ°TUBUFEÇ°BUÇ°GBJSÇ°WBMVFÇ°$IBOHFTÇ°JOÇ°UIFÇ°GBJSÇ°WBMVFÇ°PGÇ°UIFTFÇ°TFDVSJUJFTÇ°BSFÇ°SFDPSEFEÇ°JOÇ°QSPĹłUÇ°PSÇ°MPTTÇ° b) Investments in available-for-sale securities are stated at fair value. Changes in the fair value of these securities are in comprehensive Ç° JODPNF Ç°BOEÇ°XJMMÇ°CFÇ°SFDPSEFEÇ°JOÇ°QSPĹłUÇ°PSÇ°MPTTÇ°XIFOÇ°UIFÇ°TFDVSJUJFTÇ°BSFÇ°TPME c) Investments in debt securities, both due within one year and expected to be held to maturity, are recorded at amortised cost. The premium/discount on debt securities is amortised/accreted by the effective rate method with the amortised/accreted amount presented as an adjustment to the interest income. E Ç° *OWFTUNFOUTÇ°JOÇ°OPONBSLFUBCMFÇ°FRVJUZÇ°TFDVSJUJFT Ç°XIJDIÇ°UIFÇ°$PNQBOZÇ°DMBTTJĹłFTÇ°BTÇ°PUIFSÇ°JOWFTUNFOUT Ç°BSFÇ°TUBUFEÇ°BUÇ°DPTUÇ°OFUÇ°PGÇ° allowance for impairment losses (if any). F Ç° *OWFTUNFOUTÇ°JOÇ°BTTPDJBUFTÇ°BSFÇ°BDDPVOUFEÇ°GPSÇ°JOÇ°UIFÇ°DPOTPMJEBUFEÇ°ĹłOBODJBMÇ°TUBUFNFOUTÇ°VTJOHÇ°UIFÇ°FRVJUZÇ°NFUIPE G Ç° *OWFTUNFOUTÇ°JOÇ°KPJOUÇ°WFOUVSFTÇ°BSFÇ°BDDPVOUFEÇ°GPSÇ°JOÇ°UIFÇ°DPOTPMJEBUFEÇ°ĹłOBODJBMÇ°TUBUFNFOUTÇ°VTJOHÇ°UIFÇ°QSPQPSUJPOBUFÇ°DPOTPMJEBUJPOÇ°NFUIPE H Ç° *OWFTUNFOUTÇ°JOÇ°TVCTJEJBSJFT Ç°KPJOUÇ°WFOUVSFTÇ°BOEÇ°BTTPDJBUFTÇ°BSFÇ°BDDPVOUFEÇ°GPSÇ°JOÇ°UIFÇ°TFQBSBUFÇ°ĹłOBODJBMÇ°TUBUFNFOUTÇ°VTJOHÇ°UIFÇ°DPTUÇ°NFUIPE The fair value of marketable securities is based on the latest bid price of the last working day of the year. The fair value of debt instruments is determined based on yield rates quoted by the Thai Bond Market Association. The fair value of unit trusts is determined from their net asset value. The weighted average method is used for computation of the cost of investments. Ç° *OÇ°UIFÇ°FWFOUÇ°UIFÇ°(SPVQÇ°SFDMBTTJĹłFTÇ°JOWFTUNFOUTÇ°GSPNÇ°POFÇ°UZQFÇ°UPÇ°BOPUIFS Ç°TVDIÇ°JOWFTUNFOUTÇ°XJMMÇ°CFÇ°SFBEKVTUFEÇ°UPÇ°UIFJSÇ°GBJSÇ°WBMVFÇ°BTÇ° Ç° BUÇ°UIFÇ°SFDMBTTJĹłDBUJPOÇ°EBUFÇ°5IFÇ°EJGGFSFODFÇ°CFUXFFOÇ°UIFÇ°DBSSZJOHÇ°BNPVOUÇ°PGÇ°UIFÇ°JOWFTUNFOUTÇ°BOEÇ°UIFÇ°GBJSÇ°WBMVFÇ°POÇ°UIFÇ°EBUFÇ°PGÇ° Ç° SFDMBTTJĹłDBUJPOÇ°BSFÇ°SFDPSEFEÇ°BTÇ°QSPĹłUÇ°PSÇ°MPTTÇ°PSÇ°SFDPSEFEÇ°BTÇ°PUIFSÇ°DPNQPOFOUTÇ°PGÇ°TIBSFIPMEFSTÄ´Ç°FRVJUZ Ç°EFQFOEJOHÇ°POÇ°UIFÇ°UZQFÇ°PGÇ° Ç° JOWFTUNFOUÇ°UIBUÇ°JTÇ°SFDMBTTJĹłFEÇ° On disposal of an investment, the difference between net disposal proceeds and the carrying amount of the investment is Ç° SFDPHOJTFEÇ°JOÇ°QSPĹłUÇ°PSÇ°MPTTÇ° Ç° 1SPQFSUZ Ç°QMBOUÇ°BOEÇ°FRVJQNFOU%FQSFDJBUJPO Land is stated at cost. Building and equipment are stated at cost less accumulated depreciation and allowance for loss on impairment of assets (if any).


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Depreciation of plant and equipment is calculated by reference to their costs on the straight-line basis over the following estimated useful lives: Useful lives Buildings 20 years Building improvement 5 years Operating equipment 5 years Computer and equipment 3 years ǰ 'VSOJUVSF ǰųYUVSFTǰBOEǰPGųDFǰFRVJQNFOUǰ ǰǰǰ ǰBOEǰǰZFBST Motor vehicles 5 years Others 5 years Depreciation is included in determining income. No depreciation is provided for land, construction in progress and equipment under installation. ǰ "OǰJUFNǰPGǰQSPQFSUZ ǰQMBOUǰBOEǰFRVJQNFOUǰJTǰEFSFDPHOJTFEǰVQPOǰEJTQPTBMǰPSǰXIFOǰOPǰGVUVSFǰFDPOPNJDǰCFOFųUTǰBSFǰFYQFDUFEǰGSPNǰJUTǰ ǰ VTFǰPSǰEJTQPTBMǰ"OZǰHBJOǰPSǰMPTTǰBSJTJOHǰPOǰEJTQPTBMǰPGǰBOǰBTTFUǰJTǰJODMVEFEǰJOǰQSPųUǰPSǰMPTTǰXIFOǰUIFǰBTTFUǰJTǰEFSFDPHOJTFE ǰ *OUBOHJCMFǰBTTFUTǰ ǰ *OUBOHJCMFǰBTTFUTǰXJUIǰųOJUFǰMJWFTǰBSFǰBNPSUJTFEǰPOǰBǰTZTUFNBUJDǰCBTJTǰPWFSǰUIFǰFDPOPNJDǰVTFGVMǰMJGFǰBOEǰUFTUFEǰGPSǰJNQBJSNFOUǰ whenever there is an indication that the intangible asset may be impaired. The amortisation period and the amortisation method ǰ PGǰTVDIǰJOUBOHJCMFǰBTTFUTǰBSFǰSFWJFXFEǰBUǰMFBTUǰBUǰFBDIǰųOBODJBMǰZFBSǰFOEǰ5IFǰBNPSUJTBUJPOǰFYQFOTFǰJTǰDIBSHFEǰUPǰQSPųUǰPSǰMPTT ǰ *OUBOHJCMFǰBTTFUTǰXJUIǰJOEFųOJUFǰVTFGVMǰMJWFTǰBSFǰOPUǰBNPSUJTFE ǰCVUǰBSFǰUFTUFEǰGPSǰJNQBJSNFOUǰBOOVBMMZǰFJUIFSǰJOEJWJEVBMMZǰPSǰBUǰUIFǰ ǰ DBTIǰHFOFSBUJOHǰVOJUǰMFWFMǰ5IFǰBTTFTTNFOUǰPGǰJOEFųOJUFǰVTFGVMǰMJWFTǰPGǰUIFǰJOUBOHJCMFǰBTTFUTǰJTǰSFWJFXFEǰBOOVBMMZ ǰ "ǰTVNNBSZǰPGǰUIFǰJOUBOHJCMFǰBTTFUTǰXJUIǰųOJUFǰVTFGVMǰMJWFTǰJTǰBTǰGPMMPXT a) Computer software is carried at cost less accumulated amortisation and impairment losses (if any). It is amortised on a straight-line basis over the contract periods. b) Program rights are carried at cost less accumulated amortisation and impairment losses (if any). They are recognised as the assets and liabilities under the license contracts when the license contracts period whereby, the cost of rights are known, and rights are under control of the Company. Program rights are amortised on a straight-line basis over the license contract periods or the basis of projected revenues within the license contract periods or 4 years. c) Motion picture and cartoon copyrights are carried at cost less accumulated amortisation and impairment losses (if any). They are amortised on the basis of projected revenues within 10 years (for motion picture) and 5 years (for cartoon) from the time they are exhibited. Game licenses and other rights are carried at cost less accumulated amortisation and impairment losses (if any). Game licenses and other rights are amortised on a straight-line basis over the license contract periods. ǰ 5IFǰJOUBOHJCMFǰBTTFUTǰXIJDIǰBSFǰFYQFDUFEǰUPǰSFBMJTFǰXJUIJOǰPOFǰZFBSǰBSFǰDMBTTJųFEǰBTǰDVSSFOUǰBTTFUT ǰ *OUBOHJCMFǰBTTFUTǰXJUIǰJOEFųOJUFǰVTFGVMǰMJWFTǰBSFǰUIFǰDPQZSJHIUTǰUPǰNVTJDBMǰDPNQPTJUJPOTǰXIJDIǰBSFǰDBSSJFEǰBUǰDPTUǰMFTTǰBDDVNVMBUFEǰ ǰ BNPSUJTBUJPOǰBOEǰJNQBJSNFOUǰMPTTFTǰ JGǰBOZ ǰ5IFZǰIBWFǰUIFǰJOEFųOJUFǰVTFGVMǰMJGF ǰUIFSFGPSFǰUIFZǰBSFǰOPUǰBNPSUJTFEǰCVUǰBSFǰUFTUFEǰGPSǰ ǰ JNQBJSNFOUǰBOOVBMMZǰFJUIFSǰJOEJWJEVBMMZǰPSǰBUǰUIFǰDBTIǰHFOFSBUJOHǰVOJUǰMFWFMǰ5IFǰBTTFTTNFOUǰPGǰJOEFųOJUFǰVTFGVMǰMJGFǰJTǰSFWJFXFEǰBOOVBMMZ 5.8 Goodwill Goodwill is initially recorded at cost, which equals to the excess of cost of business combination over the fair value of the net assets acquired. If the fair value of the net assets acquired exceeds the cost of business combination, the excess is immediately recognised ǰ BTǰHBJOǰJOǰQSPųUǰPSǰMPTT Goodwill is carried at cost less any impairment losses. Goodwill is tested for impairment annually and when circumstances indicate that the carrying value may be impaired. For the purpose of impairment testing, goodwill acquired in a business combination is allocated to each of the Group’s cash generating ǰ VOJUTǰ PSǰHSPVQǰPGǰDBTIHFOFSBUJOHǰVOJUT ǰUIBUǰBSFǰFYQFDUFEǰUPǰCFOFųUǰGSPNǰUIFǰTZOFSHJFTǰPGǰUIFǰDPNCJOBUJPOǰ5IFǰ(SPVQǰFTUJNBUFTǰ the recoverable amount of each cash-generating unit (or group of cash-generating units) to which the goodwill relates. Where the ǰ SFDPWFSBCMFǰBNPVOUǰPGǰUIFǰDBTIHFOFSBUJOHǰVOJUǰJTǰMFTTǰUIBOǰUIFǰDBSSZJOHǰBNPVOU ǰBOǰJNQBJSNFOUǰMPTTǰJTǰSFDPHOJTFEǰJOǰQSPųUǰPSǰMPTTǰ Impairment losses relating to goodwill cannot be reversed in future periods.


112

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ANNUAL REPORT 2013

GMM GRAMMY

5.9 Related party transactions Related parties comprise enterprises and individuals that control, or are controlled by, the Group, whether directly or indirectly, or which are under common control with the Group. They also include associated companies and individuals which directly or indirectly own a voting interest in the Group that gives them ǰ TJHOJųDBOUǰJOŴVFODFǰPWFSǰUIFǰ(SPVQ ǰLFZǰNBOBHFNFOUǰQFSTPOOFM ǰEJSFDUPST ǰBOEǰPGųDFSTǰXJUIǰBVUIPSJUZǰJOǰUIFǰQMBOOJOHǰBOEǰEJSFDUJPOǰ of the Group’s operations. ǰ -POHUFSNǰMFBTFT ǰ -FBTFTǰPGǰQSPQFSUZ ǰQMBOUǰPSǰFRVJQNFOUǰXIJDIǰUSBOTGFSǰTVCTUBOUJBMMZǰBMMǰUIFǰSJTLTǰBOEǰSFXBSETǰPGǰPXOFSTIJQǰBSFǰDMBTTJųFEǰBTǰųOBODFǰ leases. Finance leases are capitalised at the lower of the fair value of the leased assets and the present value of the minimum lease ǰ QBZNFOUTǰ5IFǰPVUTUBOEJOHǰSFOUBMǰPCMJHBUJPOT ǰOFUǰPGǰųOBODFǰDIBSHFT ǰBSFǰJODMVEFEǰJOǰMPOHUFSNǰQBZBCMFT ǰXIJMFǰUIFǰJOUFSFTUǰFMFNFOUǰ ǰ JTǰDIBSHFEǰUPǰQSPųUǰPSǰMPTTǰPWFSǰUIFǰMFBTFǰQFSJPEǰ5IFǰBTTFUTǰBDRVJSFEǰVOEFSǰųOBODFǰMFBTFTǰJTǰEFQSFDJBUFEǰPWFSǰUIFǰTIPSUFSǰPGǰUIFǰ useful life of the asset and the lease period. ǰ -FBTFTǰPGǰQSPQFSUZ ǰQMBOUǰPSǰFRVJQNFOUǰXIJDIǰEPǰOPUǰUSBOTGFSǰTVCTUBOUJBMMZǰBMMǰUIFǰSJTLTǰBOEǰSFXBSETǰPGǰPXOFSTIJQǰBSFǰDMBTTJųFEǰBTǰ ǰ PQFSBUJOHǰMFBTFTǰ0QFSBUJOHǰMFBTFǰQBZNFOUTǰBSFǰSFDPHOJTFEǰBTǰBOǰFYQFOTFǰJOǰQSPųUǰPSǰMPTTǰPOǰBǰTUSBJHIUMJOFǰCBTJTǰPWFSǰUIFǰMFBTFǰUFSN ǰ 'PSFJHOǰDVSSFODJFT ǰ 5IFǰDPOTPMJEBUFEǰBOEǰTFQBSBUFǰųOBODJBMǰTUBUFNFOUTǰBSFǰQSFTFOUFEǰJOǰ#BIU ǰXIJDIǰJTǰBMTPǰUIFǰ(SPVQĴTǰGVODUJPOBMǰDVSSFODZǰ*UFNTǰPGǰ ǰ FBDIǰFOUJUZǰJODMVEFEǰJOǰUIFǰDPOTPMJEBUFEǰųOBODJBMǰTUBUFNFOUTǰPGǰFBDIǰFOUJUZǰBSFǰNFBTVSFEǰVTJOHǰUIFǰGVODUJPOBMǰDVSSFODZǰPGǰUIBUǰFOUJUZ Transactions in foreign currencies are translated into Baht at the exchange rate ruling at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies are translated into Baht at the exchange rate ruling at the end of reporting period. Gains and losses on exchange are included in determining income. ǰ *NQBJSNFOUǰPGǰBTTFUT At the end of each reporting period, the Group performs impairment reviews in respect of the property, plant and equipment and other intangible assets whenever events or changes in circumstances indicate that an asset may be impaired. The Group also ǰ DBSSJFTǰPVUǰBOOVBMǰJNQBJSNFOUǰSFWJFXTǰJOǰSFTQFDUǰPGǰHPPEXJMMǰBOEǰJOUBOHJCMFǰBTTFUTǰXJUIǰJOEFųOJUFǰVTFGVMǰMJWFTǰ"OǰJNQBJSNFOUǰMPTTǰ is recognised when the recoverable amount of an asset, which is the higher of the asset’s fair value less costs to sell and its value in use, is less than the carrying amount. ǰ "OǰJNQBJSNFOUǰMPTTǰJTǰSFDPHOJTFEǰJOǰQSPųUǰPSǰMPTT In the assessment of asset impairment if there is any indication that previously recognised impairment losses may no longer exist or may have decreased, the Group estimates the asset’s recoverable amount. A previously recognised impairment loss is reversed only if there has been a change in the assumptions used to determine the asset’s recoverable amount since the last impairment loss was recognised. The increased carrying amount of the asset attributable to a reversal of an impairment loss shall not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset in prior years. Such ǰ SFWFSTBMǰJTǰSFDPHOJTFEǰJOǰQSPųUǰPSǰMPTT ǰ 1SPWJTJPOǰGPSǰHPPETǰSFUVSOT Provision for goods returns is estimated with reference to actual goods returns occurring during the year and calculated at the rate of sales made during the year. ǰ &NQMPZFFǰCFOFųUT 4IPSUUFSNǰFNQMPZFFǰCFOFųUT Salaries, wages, bonuses and contributions to the social security fund are recognised as expenses when incurred. 1PTUFNQMPZNFOUǰCFOFųUT %FųOFEǰDPOUSJCVUJPOǰQMBOT The Group and its employees have jointly established a provident fund. The fund is monthly contributed by employees and by the Group. The fund’s assets are held in a separate trust fund and the Group’s contributions are recognised as expenses when incurred. %FųOFEǰCFOFųUǰQMBOT The Group has obligations in respect of the severance payments it must make to employees upon retirement under labor law. ǰ 5IFǰ(SPVQǰUSFBUTǰUIFTFǰTFWFSBODFǰQBZNFOUǰPCMJHBUJPOTǰBTǰBǰEFųOFEǰCFOFųUǰQMBOǰ


113

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5IFǰPCMJHBUJPOǰVOEFSǰUIFǰEFųOFEǰCFOFųUǰQMBOǰJTǰEFUFSNJOFEǰCZǰBǰQSPGFTTJPOBMMZǰRVBMJųFEǰJOEFQFOEFOUǰBDUVBSZǰCBTFEǰPOǰBDUVBSJBMǰ techniques, using the projected unit credit method. ǰ "DUVBSJBMǰHBJOTǰBOEǰMPTTFTǰBSJTJOHǰGSPNǰQPTUFNQMPZNFOUǰCFOFųUTǰBSFǰSFDPHOJTFEǰJNNFEJBUFMZǰJOǰPUIFSǰDPNQSFIFOTJWFǰJODPNFǰ 5.15 Provisions ǰ 1SPWJTJPOTǰBSFǰSFDPHOJTFEǰXIFOǰUIFǰ(SPVQǰIBTǰBǰQSFTFOUǰPCMJHBUJPOǰBTǰBǰSFTVMUǰPGǰBǰQBTUǰFWFOU ǰJUǰJTǰQSPCBCMFǰUIBUǰBOǰPVUŴPXǰPGǰ ǰ SFTPVSDFTǰFNCPEZJOHǰFDPOPNJDǰCFOFųUTǰXJMMǰCFǰSFRVJSFEǰUPǰTFUUMFǰUIFǰPCMJHBUJPO ǰBOEǰBǰSFMJBCMFǰFTUJNBUFǰDBOǰCFǰNBEFǰPGǰUIFǰ amount of the obligation. ǰ *ODPNFǰ5BY Income tax expense represents the sum of corporate income tax currently payable and deferred tax. Current tax ǰ $VSSFOUǰJODPNFǰUBYǰJTǰQSPWJEFEǰJOǰUIFǰBDDPVOUTǰBUǰUIFǰBNPVOUǰFYQFDUFEǰUPǰCFǰQBJEǰUPǰUIFǰUBYBUJPOǰBVUIPSJUJFT ǰCBTFEǰPOǰUBYBCMFǰQSPųUTǰ determined in accordance with tax legislation. Deferred tax Deferred income tax is provided on temporary differences between the tax bases of assets and liabilities and their carrying amounts at the end of each reporting period, using the tax rates enacted at the end of the reporting period. The Group recognises deferred tax liabilities for all taxable temporary differences while it recognises deferred tax assets for all ǰ EFEVDUJCMFǰUFNQPSBSZǰEJGGFSFODFTǰBOEǰUBYǰMPTTFTǰDBSSJFEǰGPSXBSEǰUPǰUIFǰFYUFOUǰUIBUǰJUǰJTǰQSPCBCMFǰUIBUǰGVUVSFǰUBYBCMFǰQSPųUǰXJMMǰCFǰ available against which such deductible temporary differences and tax losses carried forward can be utilised. At each reporting date, the Group reviews and reduces the carrying amount of deferred tax assets to the extent that it is no longer ǰ QSPCBCMFǰUIBUǰTVGųDJFOUǰUBYBCMFǰQSPųUǰXJMMǰCFǰBWBJMBCMFǰUPǰBMMPXǰBMMǰPSǰQBSUǰPGǰUIFǰEFGFSSFEǰUBYǰBTTFUǰUPǰCFǰVUJMJTFE The Group records deferred tax directly to shareholders’ equity if the tax relates to items that are recorded directly to shareholders’ equity.

6. Significant accounting judgements and estimates Ç° Ç° Ç° Ç°

Ç° Ç° Ç°

Ç° Ç°

5IFÇ°QSFQBSBUJPOÇ°PGÇ°ĹłOBODJBMÇ°TUBUFNFOUTÇ°JOÇ°DPOGPSNJUZÇ°XJUIÇ°ĹłOBODJBMÇ°SFQPSUJOHÇ°TUBOEBSETÇ°BUÇ°UJNFTÇ°SFRVJSFTÇ°NBOBHFNFOUÇ°UPÇ°NBLFÇ°TVCKFDUJWFÇ° judgements and estimates regarding matters that are inherently uncertain. These judgements and estimates affect reported amounts and EJTDMPTVSFT Ç°BOEÇ°BDUVBMÇ°SFTVMUTÇ°DPVMEÇ°EJGGFSÇ°GSPNÇ°UIFTFÇ°FTUJNBUFTÇ°4JHOJĹłDBOUÇ°KVEHFNFOUTÇ°BOEÇ°FTUJNBUFTÇ°BSFÇ°BTÇ°GPMMPXT Leases *OÇ°EFUFSNJOJOHÇ°XIFUIFSÇ°BÇ°MFBTFÇ°JTÇ°UPÇ°CFÇ°DMBTTJĹłFEÇ°BTÇ°BOÇ°PQFSBUJOHÇ°MFBTFÇ°PSÇ°ĹłOBODFÇ°MFBTF Ç°UIFÇ°NBOBHFNFOUÇ°JTÇ°SFRVJSFEÇ°UPÇ°VTFÇ°KVEHFNFOUÇ°SFHBSEJOHÇ° XIFUIFSÇ°TJHOJĹłDBOUÇ°SJTLÇ°BOEÇ°SFXBSETÇ°PGÇ°PXOFSTIJQÇ°PGÇ°UIFÇ°MFBTFEÇ°BTTFUÇ°IBTÇ°CFFOÇ°USBOTGFSSFE Ç°UBLJOHÇ°JOUPÇ°DPOTJEFSBUJPOÇ°UFSNTÇ°BOEÇ°DPOEJUJPOTÇ° of the arrangement. Allowance for doubtful accounts In determining an allowance for doubtful accounts, the management needs to make judgement and estimates based upon, among other UIJOHT Ç°QBTUÇ°DPMMFDUJPOÇ°IJTUPSZ Ç°BHJOHÇ°QSPĹłMFÇ°PGÇ°PVUTUBOEJOHÇ°EFCUTÇ°BOEÇ°UIFÇ°QSFWBJMJOHÇ°FDPOPNJDÇ°DPOEJUJPOÇ° *NQBJSNFOUÇ°PGÇ°FRVJUZÇ°JOWFTUNFOUT 5IFÇ°(SPVQÇ°USFBUTÇ°BWBJMBCMFGPSTBMFÇ°JOWFTUNFOUTÇ°BOEÇ°PUIFSÇ°JOWFTUNFOUTÇ°BTÇ°JNQBJSFEÇ°XIFOÇ°UIFSFÇ°IBTÇ°CFFOÇ°BÇ°TJHOJĹłDBOUÇ°PSÇ°QSPMPOHFEÇ°EFDMJOFÇ° JOÇ°UIFÇ°GBJSÇ°WBMVFÇ°CFMPXÇ°UIFJSÇ°DPTUÇ°PSÇ°XIFSFÇ°PUIFSÇ°PCKFDUJWFÇ°FWJEFODFÇ°PGÇ°JNQBJSNFOUÇ°FYJTUTÇ°5IFÇ°EFUFSNJOBUJPOÇ°PGÇ°XIBUÇ°JTÇ°ÄśTJHOJĹłDBOUġǰPSÇ° “prolongedâ€? requires judgement of the management. 1SPQFSUZÇ°QMBOUÇ°BOEÇ°FRVJQNFOU%FQSFDJBUJPO In determining depreciation of plant and equipment, the management is required to make estimates of the useful lives and residual values of the Group’s plant and equipment and to review estimate useful lives and residual values when there are any changes. In addition, the management is required to review property, plant and equipment for impairment on a periodical basis and record impairment losses when it is determined that their recoverable amount is lower than the carrying amount. This requires judgements regarding forecast of future revenues and expenses relating to the assets subject to the review. (PPEXJMMÇ°BOEÇ°JOUBOHJCMFÇ°BTTFUT The initial recognition and measurement of goodwill and intangible assets, and subsequent impairment testing, require management to NBLFÇ°FTUJNBUFTÇ°PGÇ°DBTIÇ°Ĺ´PXTÇ°UPÇ°CFÇ°HFOFSBUFEÇ°CZÇ°UIFÇ°BTTFUÇ°PSÇ°UIFÇ°DBTIÇ°HFOFSBUJOHÇ°VOJUTÇ°BOEÇ°UPÇ°DIPPTFÇ°BÇ°TVJUBCMFÇ°EJTDPVOUÇ°SBUFÇ°JOÇ°PSEFSÇ° UPÇ°DBMDVMBUFÇ°UIFÇ°QSFTFOUÇ°WBMVFÇ°PGÇ°UIPTFÇ°DBTIÇ°Ĺ´PXTÇ°Ç°


114

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ANNUAL REPORT 2013

GMM GRAMMY

1SPHSBNǰSJHIUTǰBOEǰNPUJPOǰQJDUVSFǰBOEǰDBSUPPOǰDPQZSJHIUT"NPSUJTBUJPO In determining the amortisation of program rights and motion picture and cartoon copyrights on the basis of projected revenues, the management is required to make estimates of the expected revenues embodied in the assets. Changes of assumptions, including internal and external factors, will have an impact on such projected revenues and amortisation. Deferred tax assets Deferred tax assets are recognised for deductible temporary differences and unused tax losses to the extent that it is probable that taxable QSPųUǰXJMMǰCFǰBWBJMBCMFǰBHBJOTUǰXIJDIǰUIFǰUFNQPSBSZǰEJGGFSFODFTǰBOEǰMPTTFTǰDBOǰCFǰVUJMJTFEǰ4JHOJųDBOUǰNBOBHFNFOUǰKVEHFNFOUǰJTǰSFRVJSFEǰUPǰ EFUFSNJOFǰUIFǰBNPVOUǰPGǰEFGFSSFEǰUBYǰBTTFUTǰUIBUǰDBOǰCFǰSFDPHOJTFE ǰCBTFEǰVQPOǰUIFǰMJLFMZǰUJNJOHǰBOEǰMFWFMǰPGǰFTUJNBUFǰGVUVSFǰUBYBCMFǰQSPųUT 1PTUFNQMPZNFOUǰCFOFųUTǰVOEFSǰEFųOFEǰCFOFųUǰQMBOT 5IFǰPCMJHBUJPOǰVOEFSǰUIFǰEFųOFEǰCFOFųUǰQMBOǰJTǰEFUFSNJOFEǰCBTFEǰPOǰBDUVBSJBMǰUFDIOJRVFTǰ4VDIǰEFUFSNJOBUJPOǰJTǰNBEFǰCBTFEǰPOǰ various assumptions, including discount rate, future salary increase rate, mortality rate and staff turnover rate. -JUJHBUJPOǰ The Group has contingent liabilities as a result of litigation. The Company’s management has used judgement to assess of the results of the litigation and believes that no loss will result. Therefore no contingent liabilities are recorded as at the end of reporting period.

7. Related party transactions Ç°

%VSJOHÇ°UIFÇ°ZFBST Ç°UIFÇ°(SPVQÇ°IBEÇ°TJHOJĹłDBOUÇ°CVTJOFTTÇ°USBOTBDUJPOTÇ°XJUIÇ°SFMBUFEÇ°QBSUJFTÇ°4VDIÇ°USBOTBDUJPOT Ç°XIJDIÇ°BSFÇ°TVNNBSJTFEÇ°CFMPX Ç° arose in the ordinary course of business and were concluded on commercial terms and bases agreed upon between the Group and those related parties. (Unit: Million Baht)

Consolidated financial statements 2013 2012

Pricing policy

Transactions with jointly controlled entity Service income Transactions with associated companies Service income Other income Service expenses

10

57

(6)

62 6 409

22 6 378

(2) (5) (5)

Transactions with related companies Rental and other service expenses

244

201

(1)/(5)/(6)

10

9

Transactions with management and directors Service expenses

(3)/(5)


115

(Unit: Million Baht)

Separate financial statements 2013 2012 Transactions with subsidiaries Ç° FMJNJOBUFEÇ°GSPNÇ°UIFÇ°DPOTPMJEBUFEÇ°ĹłOBODJBMÇ°TUBUFNFOUT

Service income Revenues from copyrights Interest income Other income Service expenses Interest expenses Purchase of inventories Purchase of intangible assets Disposals of intangible assets and other assets Transactions with associated companies Purchase of intangible assets Service expenses Transactions with related companies Rental and other service expenses Transactions with management and directors Service expenses

Ç°

(1) (2) (3) (4) (5) (6) (7)  Ç°

Pricing policy

420 131 35 22 418 27 6 48 -

166 115 1 15 435 26 377

21 9

4

113

102

4

5

(2)/(4)/(5) (3) (8) (5) (5) (8) (4) (7) (7) (5) (5) (1)/(5)/(6) (3)/(5)

Contract price with the rental rate as appraised by independent valuer or the contract price With reference to prices charged to third parties depending on when the sales were made and the agreement. Charge per unit sold with reference to market price Cost plus margin Mutually agreed price Contract price Cost price "UÇ°UIFÇ°SBUFÇ°OPUÇ°MPXFSÇ°UIBOÇ°UIFÇ°SBUFÇ°PGÇ°ĹłYFEÇ°EFQPTJUÇ°PSÇ°UIFÇ°SBUFÇ°PGÇ°.POFZÇ°.BSLFUÇ°3BUFÇ° ..3 Ç°CBTFEÇ°POÇ°DBTFÇ°CZÇ°DBTF


116

ANNUAL REPORT 2013

GMM GRAMMY

As at 31 December 2013 and 2012, the balances of the accounts between the Company and those related parties are as follows: (Unit: Thousand Baht)

Consolidated financial statements 2013 2012

Separate financial statements 2013 2012

Trade and other receivables - related parties /PUFÇ°

Subsidiaries Ç° Ç° +PJOUMZÇ°DPOUSPMMFEÇ°FOUJUJFTÇ° Associated companies Related companies (related by common shareholder) Total trade and other receivables - related parties

 Ç° 37,328 191 40,010

 Ç° 14,628 750 23,009

1,137,381 Ç° 872 74 1,138,327

929,000  441 481 929,922

Trade and other payables - related parties /PUFÇ°

Subsidiaries Associated companies Related companies (related by common shareholder) Management and directors Total trade and other payables - related parties

72,697 13,199 4,724 90,620

88,268 12,483 4,185 104,936

127,959 710 4,846 3,547 137,062

202,875 916 4,866 3,394 212,051

Loans to related parties As at 31 December 2013 and 2012, the balance of loans between the Company and those related companies and the movement are as follows: (Unit: Thousand Baht)

Consolidated financial statements Loans to related parties Ç° +PJOUÇ°7FOUVSFÇ°*OEFYÇ°%Ç°.BDPÇ° Blue media Communications Company Limited Max Creative Company Limited Town Branding Company Limited Total

Related by +PJOUMZÇ°DPOUSPMMFE entity Associate Associate Associate

Balance as at Increase Decrease Balance as at 31 December during the year during the year 31 December 2012 2013 3,000

-

(3,000)

-

2,200 1,000 6,200

5,500 5,500

(234) (1,000) (2,500) (6,734)

1,966 3,000 4,966


117

(Unit: Thousand Baht)

Separate financial statements Loans to related parties GR Vocal Studio Company Limited Fan TV Company Limited G S-one Company Limited GMM Z Company Limited GMM Z Trading Company Limited GMM B Company Limited Total Ç°

Related by Subsidiaries Subsidiaries Subsidiaries Subsidiaries Subsidiaries Subsidiaries

Balance as at Increase Decrease Balance as at 31 December during the year during the year 31 December 2012 2013 3,000 7,000 4,000 14,000

1,500 17,330 167,000 440,000 1,055,000 1,680,830

(1,000) (18,873) (80,000) (99,873)

3,500 5,457 4,000 87,000 440,000 1,055,000 1,594,957

.JOJNVNÇ°JOUFSFTUÇ°SBUFÇ°DIBSHFEÇ°POÇ°MPBOTÇ°UPÇ°TVCTJEJBSJFTÇ°JTÇ°DIBSHFEÇ°BUÇ°UIFÇ°SBUFÇ°OPUÇ°MPXFSÇ°UIBOÇ°UIFÇ°SBUFÇ°PGÇ°ĹłYFEÇ°EFQPTJUÇ°PSÇ°UIFÇ°SBUFÇ° of Money Market Rate (MMR) based on case by case. Interest rate charged on loans to jointly controlled entity is charged at 5.25 percent per annum. Minimum interest rate charged on loans to associated companies is charged at the rate not lower than the rate of minimum loan rate (MLR). Loans from related parties As at 31 December 2013 and 2012, the balance of loans from related companies and the movement are as follows: (Unit: Thousand Baht)

Separate financial statements Balance as at 31 December 2012 4IPSUUFSNÇ°MPBOTÇ°GSPNÇ°SFMBUFEÇ°QBSUJFT Subsidiaries MGA Company Limited GMM Music Publishing International Company Limited GMM Tai Hub Company Limited GMM Holding Company Limited Digital Gen Company Limited GDC Company Limited Extraorganizer Company Limited GMM Media Public Company Limited 3-RD Company Limited Total

-

During the year Increase

31,500 60,000 240,000 128,000 5,500 7,500 1,000 872,500 17,000 1,363,000

Balance as at 31 December 2013

Decrease

-

31,500 60,000 240,000 128,000 5,500 7,500 1,000 872,500 17,000 1,363,000


118

Ç°

ANNUAL REPORT 2013

GMM GRAMMY

%JSFDUPSTÇ°BOEÇ°NBOBHFNFOUÄ´TÇ°CFOFĹłUT %VSJOHÇ°UIFÇ°ZFBSÇ°FOEFEÇ°Ç°%FDFNCFSÇ°Ç°BOEÇ° Ç°UIFÇ°(SPVQÇ°IBEÇ°FNQMPZFFÇ°CFOFĹłUÇ°FYQFOTFTÇ°QBZBCMFÇ°PGÇ°UIFJSÇ°EJSFDUPSTÇ°BOEÇ° management as below. (Unit: Thousand Baht)

Consolidated financial statements Separate financial statements 2013 Ç° 4IPSUUFSNÇ°FNQMPZFFÇ°CFOFĹłUTÇ° Ç° 1PTUFNQMPZNFOUÇ°CFOFĹłUTÇ° Total

Ç°

 Ç°  Ç° 78,621

2012  Ç°  Ç° 109,073

2013

2012

 Ç°  Ç° 61,126

    91,935

Guarantee obligations with related parties 5IFÇ°(SPVQÇ°IBTÇ°PVUTUBOEJOHÇ°HVBSBOUFFÇ°PCMJHBUJPOTÇ°XJUIÇ°JUTÇ°SFMBUFEÇ°QBSUJFT Ç°BTÇ°EFTDSJCFEÇ°JOÇ°/PUFÇ°Ç°UPÇ°UIFÇ°ĹłOBODJBMÇ°TUBUFNFOUT

8. Cash and cash equivalents (Unit: Thousand Baht)

Consolidated financial statements Separate financial statements 2013 Cash on hand and at banks Short-term investments Total

Ç°

1,128,036 525,032 1,653,068

2012 642,426 202,431 844,857

2013

2012

343,469 520,000 863,469

139,996 139,996

"TÇ°BUÇ°Ç°%FDFNCFSÇ° Ç°CBOLÇ°EFQPTJUTÇ°JOÇ°TBWJOHÇ°BDDPVOUT Ç°ĹłYFEÇ°EFQPTJUTÇ°BOEÇ°IJHIMZÇ°MJRVJEÇ°JOWFTUNFOUTÇ°DBSSJFEÇ°JOUFSFTUTÇ°CFUXFFOÇ° 0.50 and 3.10 percent per annum (2012: between 0.75 and 3.25 percent per annum) (the Company only: between 0.50 and 3.10 percent per annum, 2012: between 0.75 and 3.25 percent per annum).

9. Current investments (Unit: Thousand Baht)

2013 Fixed Deposit Investments in trading securities - Fair value Investments in held-to-maturity debt securities - due within one year Total

1,935,218 80,526 50,000 2,065,744

2012 303,915 32,839 219,303 556,057

2013 1,875,000 1,875,000

2012 -

As at 31 December 2013, current investments carried interests between 1.00 and 3.23 percent per annum (2012: between 2.00 and 3.60 percent per annum) (the Company only: between 2.95 and 3.23 percent per annum, 2012: none).


119

10. Trade and other receivables (Unit: Thousand Baht)

Consolidated financial statements Separate financial statements 2013 Trade receivables - related parties Aged on the basis of due dates Not yet due Past due Up to 3 months 3 - 6 months 6 - 12 months Over 12 months Total

2012

2013

2012

14,883

13,402

20,793

15,769

3,506 9,079 7,208 2,608 37,284

1,823 535 5,101 875 21,736

13,814 7,774 43 62,236 104,660

22,540 43,131 13,871 14,352 109,663

Trade receivables - unrelated parties Aged on the basis of due dates Not yet due Past due Up to 3 months 3 - 6 months 6 - 12 months Over 12 months Total Less: Allowance for doubtful accounts Net Total trade receivables - net

1,300,933

1,373,832

367,986

392,633

603,598 44,354 59,824 205,298 2,214,007 (173,716) 2,040,291 2,077,575

778,948 70,826 80,948 238,101 2,542,655 (209,409) 2,333,246 2,354,982

95,584 11,774 23,275 28,440 527,059 (32,459) 494,600 599,260

215,589 28,853 29,603 49,941 716,619 (41,516) 675,103 784,766

Other receivables Other receivables - related parties Other receivables - unrelated parties Dividends receivable from subsidiaries and associates Accrued income - related parties Accrued income - unrelated parties Total other receivables Total trade and other receivables - net

2,243 39,617 483 301,748 344,091 2,421,666

1,210 21,242 63 404,964 427,479 2,782,461

871,891 4,235 161,776 95,442 1,133,344 1,732,604

573,091 6,566 247,168 213,523 1,040,348 1,825,114


120

ANNUAL REPORT 2013

GMM GRAMMY

11. Inventories

(Unit: Thousand Baht)

Cost 2013 Tape reels, cassette tapes, CDs, VCDs and DVDs Motion picture and cartoon production Television programmes and satellite television programmes Work in process Books, teaching aids and magazines Satellite television receivers Others Total

2012

Consolidated financial statements Reduce cost to net realisable value 2013 2012

Inventories-net 2013

2012

434,199 56,440

435,523 37,095

(331,944) -

(126,072) -

102,255 56,440

309,451 37,095

125,116 24,521 14,538 269,011 40,621 964,446

137,743 28,104 18,610 498,769 24,717 1,180,561

(12,731) (88) (344,763)

(14,198) (909) (141,179)

125,116 24,521 1,807 269,011 40,533 619,683

137,743 28,104 4,412 498,769 23,808 1,039,382

(Unit: Thousand Baht)

Cost 2013 Tape reels, cassette tapes, CDs, VCDs and DVDs Television programmes and satellite television programmes Work in process Others Total

2012

Separate financial statements Reduce cost to net realisable value 2013 2012

Inventories-net 2013

2012

439,577

438,671

(331,944)

(124,037)

107,633

314,634

17,987 24,149 31,222 512,935

43,296 27,796 14,261 524,024

(331,944)

(124,037)

17,987 24,149 31,222 180,991

43,296 27,796 14,261 399,987

Due to the behavior of the consumer about a tape reels, CDs, VCDs and DVDs declined from the past. Therefore, category of the inventory is obsolete rapidly. During the current year, the management recoded the reduction of cost of inventory to net realisable value more than the prior year amounting to Baht 206 million (the Company only: Baht 208 million).

12. Other current assets

(Unit: Thousand Baht)

Consolidated financial statements 2013 2012 Input tax refundable Withholding tax deducted at source Intangible assets - realise within one year (Note 18) Prepayment of purchase of assets Others Total

Separate financial statements 2013 2012

273,588 117,519

203,156 72,649

518 53,197

3,387 36,181

762,127 371,198 57,144 1,581,576

185,116 19,663 94,819 575,403

21,292 16,244 91,251

9,104 9,235 57,907


121

13. Investments in subsidiaries Ç°

%FUBJMTÇ°PGÇ°JOWFTUNFOUTÇ°JOÇ°TVCTJEJBSJFTÇ°BTÇ°QSFTFOUFEÇ°JOÇ°TFQBSBUFÇ°ĹłOBODJBMÇ°TUBUFNFOUTÇ°BSFÇ°BTÇ°GPMMPXT (Unit: Thousand Baht)

Company’s name

MGA Company Limited Digital Gen Company Limited GMM Media Public Company Limited Extraorganizer Company Limited More Music Company Limited GMM Holding Company Limited GMM Music Publishing International Company Limited GMM Tai Hub Company Limited Fan TV Company Limited 3-RD Company Limited GR Vocal Studio Company Limited G S-one Company Limited Ç° (..Ç°$+Ç°0Ç°4IPQQJOHÇ°$PNQBOZÇ°Ç° Limited GMM Z Company Limited GDC Company Limited GMM Z Trading Company Limited GMM SD Digital TV Trading Company Limited GMM HD Digital TV Trading Company Limited The News TV Company Limited STGMM Company Limited Digistream Company Limited GTH On Air Company Limited Total Less: Allowance for impairment of investments Net

Paid-up capital

Separate financial statements Shareholding Cost percentage 2013 2012 2013 2012 (%) (%)

Dividend received during the year

2013 (Million Baht)

2012 (Million Baht)

2013

2012

10.5 5

10.5 5

100 100

100 100

10,500 5,000

10,500 5,000

6,000 -

-

200 1 1 100

200 1 1 100

99.92 100 100 100

99.92 100 100 100

557,474 999 1,000 100,000

557,474 999 1,000 100,000

440,205 -

320,149 8,500

5 225 200 18 5 100 Ç° 356 100 25.5 1

5 225 200 18 5 100 Ç° 356 100 25.5 1

100 51 51 70 100 50 Ç° 51 100 100 100

100 51 51 70 100 50 Ç° 51 100 100 -

4,999 181,050 83,777 12,733 2,525 Ç° 181,764 25,499 1,000

4,999 181,050 83,777 12,733 2,525 50,000 Ç° 181,764 100,000 25,499 -

14,499 15,300 21,168 Ç° -

8,999 7,056 Ç° -

26

-

100

-

25,750

-

-

-

51 1 40 1 60

1 40 1 40

100 51 50 100 30

-

50,750 510 20,000 1,000 17,999 1,284,329

1,317,320

497,172

344,704

(140,363) 1,143,966

(102,364) 1,214,956


122

ANNUAL REPORT 2013

GMM GRAMMY

%VSJOHÇ°UIFÇ°DVSSFOUÇ°ZFBS Ç°DIBOHFTÇ°PGÇ°JOWFTUNFOUTÇ°JOÇ°TVCTJEJBSJFTÇ°XIJDIÇ°IBWFÇ°CFFOÇ°QSFTFOUFEÇ°JOÇ°UIFÇ°TFQBSBUFÇ°ĹłOBODJBMÇ°TUBUFNFOUTÇ°BSFÇ°BTÇ°GPMMPXT /FXMZÇ°FTUBCMJTIFEÇ°TVCTJEJBSJFT Subsidiaries Nature of business Percentage of Description Amount shareholding (%) GMM SD Digital TV Trading Company Limited

Production of television programmes and digital on-air

100

GMM HD Digital TV Trading Company Limited

Production of television programmes and digital on-air

100

(Thousand Baht) 999,997 ordinary shares of Baht 100 each (9,997 ordinary shares of Baht 100 each, fully called up and 990,000 ordinary shares, called up 25 percent) 1,999,997 ordinary shares of Baht 100 each (9,997 ordinary shares of Baht 100 each, fully called up and 1,990,000 ordinary shares, called up 25 percent)

Total

25,750

50,750

76,500

1VSDIBTFÇ°PGÇ°JOWFTUNFOUTÇ°JOÇ°TVCTJEJBSJFT Subsidiaries

Percentage of shareholding (%)

Description

Production and distribution of satellite television receivers and prepaid card for “GMM Z Pay TV� Currently non-active

100

Production of satellite television programmes

50

Digistream Company Limited

Providing music in streaming

100

GTH On Air Company Limited

Production of satellite television programmes

30

Purchase of investment from GMM Z Company Limited, a subsidiary, 9,997 ordinary shares of Baht 100 each Purchase of investment from GMM Z Company Limited, a subsidiary, 5,099 ordinary shares of Baht 100 each Purchase of investment from GMM Z Company Limited, a subsidiary, 199,998 ordinary shares of Baht 100 each Purchase of investment from GMM Z Company Limited, a subsidiary, 9,998 ordinary shares of Baht 100 each Purchase of investment from GMM Z Company Limited, a subsidiary, 179,997 ordinary shares of Baht 100 each

GMM Z Trading Company Limited

The News TV Company Limited

STGMM Company Limited

Nature of business

51

Amount (Thousand Baht)

Total

1,000

510

20,000

1,000

17,999

40,509

%JTQPTBMÇ°PGÇ°JOWFTUNFOUTÇ°JOÇ°TVCTJEJBSJFT Subsidiaries

Nature of business

Percentage of shareholding

Description

(%) G S-one Company Limited

Currently non-active

50

GMM Z Company Limited

Service Provider

100

Total

Amount (Thousand Baht)

Disposal of investment to GMM Z Trading Company Limited, a subsidiary, 499,998 ordinary shares of Baht 1 each Disposal of investment to GMM Z Trading Company Limited, a subsidiary, 999,997 ordinary shares of Baht 1 each

500

1,000

1,500


123

14. Investments in joint ventures 14.1 Details of investments in joint ventures: Investments in joint ventures represent investments in entities which are jointly controlled by the Company and other companies. Details of these investments are as follows: (Unit: Thousand Baht) Consolidated financial statements Jointly controlled entities

K Arena Company Limited Ç° +PJOUÇ°7FOUVSFÇ°*%Ç° Ç° +PJOUÇ°7FOUVSFÇ°*OEFYÇ°$JUZOFPOÇ° Ç° +PJOUÇ°7FOUVSFÇ°*OEFYÇ°%Ç°.BDPÇ° Ç° +PJOUÇ°7FOUVSFÇ°*OEFYÇ°%Ç°

Nature of business

Shareholding percentage 2013 2012 (%) (%)

Karaoke service and rental $POTUSVDUJPOÇ°%FTJHOÇ°BOEÇ° Management of Thai exhibition building 1SPWJEFSÇ°PGÇ°DPOUSBDUPS Ç° Installation, exhibition and display materials for Siriraj Museum %FTJHOÇ°BOEÇ°.BOBHFNFOUÇ°PGÇ° exhibition building in Yeosu International Exposition 2012 %FTJHOÇ°BOEÇ°.BOBHFNFOUÇ°PGÇ° exhibition building in Universal Exhibition Milano 2015

Cost 2013

2012

50 Ç°

50 Ç°

10,000  Ç°

10,000  Ç°

Ç°

Ç°

 Ç°

 Ç°

Ç°

Ç°

Ç°

Ç°

Ç°

Ç°

Ç°

Ç°

21,000

21,000

Total

(Unit: Thousand Baht)

Jointly controlled entities

K Arena Company Limited Total

Nature of business

Separate financial statements Shareholding percentage Cost 2013 2012 2013 2012 (%) (%)

Karaoke service and rental

50

50

10,000 10,000

10,000 10,000

During the current year, change of investment in joint venture is as follow: Investment in new jointly controlled entity Investor

Index Creative Village PublicÇ° Company Limited

Jointly controlled entity

Nature of business

+PJOUÇ°7FOUVSFÇ°*OEFYÇ°%Ç° %FTJHOÇ°BOEÇ°.BOBHFNFOUÇ° of exhibition building in Universal Exhibition Milano 2015

Percentage Description of shareholding (%) Ç°

)BEÇ°OPUÇ°ZFUÇ° call-up investment

Amount (Thousand Baht) Ç°


124

Ç°

ANNUAL REPORT 2013

GMM GRAMMY

ǰ 4VNNBSJTFEǰųOBODJBMǰJOGPSNBUJPOǰPGǰKPJOUMZǰDPOUSPMMFEǰFOUJUJFT The Group’ proportionate shares of the assets, liabilities, revenue and expenses of jointly controlled entities, according to proportion under joint venture agreement, is as follows: (Unit: Million Baht)

As at 31 December Current assets Non-current assets Current liabilities Net assets

2013

2012

22 7 29 (7) 22

41 8 49 (26) 23

(Unit: Million Baht)

For the year ended 31 December 2013 2012 Revenue Cost of sales and services Selling and administrative expenses Finance cost Ç° 1SPĹłUÇ°CFGPSFÇ°JODPNFÇ°UBYÇ°FYQFOTFTÇ° Income tax expenses Ç° 1SPĹłUÇ°GPSÇ°UIFÇ°ZFBSÇ°

32 (29) (2) Ç° Ç°

158 (154) (2) (1)  (1) 


Nature of business

Country of incorporation

Production of television Thailand programmes and plays Channel [V] Music (Thailand) Company Limited Ceased the operation Thailand Nadao Bangkok Company Limited Films production and talent Thailand agency services Blue Media Communications Company Provision of publishing media design, Thailand Limited production and distribution services Max Creative Company Limited Provider of Integrated Marketing Thailand communication and Imagine advisor and management services Ç° #JHÇ°&WFOUÇ°$PNQBOZÇ°-JNJUFEÇ° 1SPEVDUJPOÇ°PGÇ°ĹłMNTÇ°BOEÇ° 5IBJMBOEÇ° television programmes Town Branding Company Limited Media production Thailand Happio Company Limited Internet communication platform Thailand Myanmar Index Creative Village Business events advisor and Myanmar Company Limited organizer TVMINDEX Advertising Company Limited Business events advisor and Vietnam organizer Sawasdeethaweesuk Company Limited Design and post production of Thailand Ç° Ç°Ç° Ç° Ç° Ç° BEWFSUJTJOHÇ°NFEJBÇ°BOEÇ°ĹłMNTÇ° Ç° Ç° Ç°Ç° Ç° Ç° Ç° BOEÇ°QVCMJDÇ°SFMBUJPOTÇ°GPSÇ°ĹłMNT "TTPDJBUFTÇ°IFMEÇ°CZÇ°UIFÇ°$PNQBOZ Family Know How Company Limited Production of television Thailand programmes and publishing media Ç° +4-Ç°$IBOOFMÇ°$PNQBOZÇ°-JNJUFEÇ° $FBTFEÇ°UIFÇ°PQFSBUJPOÇ° 5IBJMBOEÇ° Lucks (666) Satellite Company Limited Production of satellite television Thailand (2012: Held by GMM Z Company Limited) programmes Total

Associates held by the subsidiaries Scenario Company Limited

Company’s name

15.1 Details of associates:

15. Investments in associates

20 33 49 49 25 Ç°

5 5 Ç° Ç°

50 Ç° 20

5 5 Ç° 5 9 USD 1.08 million VND 2,995 million 5 Ç°

50 Ç° 20

Ç° 25

50

Ç°

50

40

25 30

85 2

85 2

25

70

70

2013 2012 (Million Baht) (Million Baht)

Paid up capital

Ç° 25

50

Ç°

-

-

Ç°

50

40

25 30

25

 Ç° 5,000 76,775

102,214

25,000

Ç°

-

-

Ç°

2,500

2,000

21,175 600

17,500

 Ç° 5,000

25,000

937 Ç°

2,210

500 3,000 16,292

 Ç°

2,500

2,000

21,175 600

17,500

Consolidated financial statements Percentage of Cost shareholding 2013 2012 2013 2012 (%) (%)

301,389

Ç° -

59,547

1,280 Ç°

610

3,049 17,614

 Ç°

2,051

958

5,374 2,821

206,145

301,475

 -

69,846

Ç°

-

-

Ç°

2,493

1,145

22,437 1,757

203,797

Carrying amounts based on equity method 2013 2012

(Unit: Thousand Baht)

125


126

ANNUAL REPORT 2013

GMM GRAMMY

(Unit: Thousand Baht)

Company’s name

Nature of business

Separate financial statements Cost Allowance for Impairment of investments

Country of Percentage of incorporation shareholding

2013 2012 (%) (%) Family Know How Company Production of television Thailand Limited programmes and publishing media Ç° +4-Ç°$IBOOFMÇ°$PNQBOZÇ°-JNJUFEÇ° $FBTFEÇ°UIFÇ°PQFSBUJPOÇ° 5IBJMBOEÇ° Lucks (666) Satellite Company Production of satellite Thailand Limited television programmes

50

50

Ç° 25

Ç° -

2013

2012

2013 2012 2013 2012

25,000 25,000  Ç° 5,000

-

 Ç° Ç° - (5,000)

33,000 28,000

During the current year, changes of investments in associates are as follow: Investment in new associates Investor Associate Nature of business

Percentage of shareholding

Carrying amounts based on cost method - net

(5,000)

- 25,000 25,000 Ç° -

 Ç° -

- 28,000 28,000

Description

(%)

Ç° *OEFYÇ°$SFBUJWFÇ°7JMMBHFÇ°1VCMJDÇ° Company Limited Index Creative Village Public Company Limited Index Creative Village Public Company Limited Index and M Company Limited Index and V Company Limited GMM Tai Hub Company Limited Ç° Ç°Ç° Ç° Ç° Ç° Ç° Ç°Ç° Ç° Ç° Ç° Total Ç°

Ç° Ç° Ç°

Ç°

#JHÇ°&WFOUÇ°$PNQBOZÇ°-JNJUFEÇ°1SPEVDUJPOÇ°PGÇ°ĹłMNTÇ° and television programmes Town Branding Company Media production Limited Happio Company Limited Internet communication platform Myanmar Index Creative Business events Village Company Limited advisor and organizer TVMINDEX Advertising Business events Company Limited advisor and organizer Sawasdeethaweesuk Design and post Company Limited production of advertising media Ç° BOEÇ°ĹłMNTÇ°BOEÇ°QVCMJDÇ° Ç° SFMBUJPOTÇ°GPSÇ°ĹłMNT

  -

Amount (Thousand Baht)

Ç°

 Ç°PSEJOBSZÇ°TIBSFTÇ°Ç° of Baht 100 each

 Ç°

20

10,000 ordinary shares of Baht 50 each 300,000 ordinary shares of Baht 10 each

500

33

3,000

49

USD 529,200

16,292

49

VND 1,467 million

2,210

25

12,499 ordinary shares of Baht 100 each (75 percent paid up) Ç°

937

Ç°

Ç° 25,439

*OÇ°4FQUFNCFSÇ° Ç°$IBOOFMÇ°<7>Ç°.VTJDÇ° 5IBJMBOE Ç°$PNQBOZÇ°-JNJUFEÇ°BOEÇ°+4-Ç°$IBOOFMÇ°$PNQBOZÇ°-JNJUFEÇ°EFSFHJTUFSFEÇ°XJUIÇ° the Ministry of Commerce. At present, they are in the process of liquidation. In December 2013, the Company purchased the investment in Lucks (666) Satellite Company Limited from GMM Z Company Limited, a subsidiary, amounting to Baht 5 million. Ç° 4IBSFÇ°PGÇ°QSPĹłUMPTTÇ°BOEÇ°EJWJEFOEÇ°SFDFJWFE Ç° %VSJOHÇ°UIFÇ°ZFBST Ç°UIFÇ°(SPVQÇ°IBTÇ°SFDPHOJTFEÇ°UIFJSÇ°TIBSFÇ°PGÇ°QSPĹłUMPTTÇ°GSPNÇ°JOWFTUNFOUTÇ°JOÇ°BTTPDJBUFTÇ°JOÇ°UIFÇ°DPOTPMJEBUFEÇ° Ç° ĹłOBODJBMÇ°TUBUFNFOUTÇ°BOEÇ°EJWJEFOEÇ°JODPNFÇ°JOÇ°UIFÇ°TFQBSBUFÇ°ĹłOBODJBMÇ°TUBUFNFOUTÇ°BTÇ°GPMMPXT


127

(Unit: Thousand Baht)

Consolidated financial statements Share of profit/loss from investments in associates during the year 2013 2012

Companyâ&#x20AC;&#x2122;s name

Associates held by the subsidiaries Scenario Company Limited Encore Company Limited Channel [V] Music (Thailand) Company Limited Nadao Bangkok Company Limited Blue Media Communications Company Limited Max Creative Company Limited Big Event Company Limited Town Branding Company Limited Happio Company Limited Myanmar Index Creative Village Company Limited TVMINDEX Advertising Company Limited Sawasdeethaweesuk Company Limited "TTPDJBUFTÇ°IFMEÇ°CZÇ°UIFÇ°$PNQBOZ Family Know How Company Limited Ç° +4-Ç°$IBOOFMÇ°$PNQBOZÇ°-JNJUFEÇ° Lucks (666) Satellite Company Limited Total

Ç°

Dividend received during the year 2013

32,097 (17,064) 1,063 (187) (441) (560) (500) 49 1,322 (1,599) 343

60,076 (154) 1,415 (99) 93 1,170 -

29,750 -

15,750 1,300 -

1,453 Ç° 15,976

25,729 Ç° (741) 87,489

11,752 Ç° 41,502

10,000  27,050

Ç° 4VNNBSJTFEÇ°ĹłOBODJBMÇ°JOGPSNBUJPOÇ°PGÇ°BTTPDJBUFT Financial information of the associates is summarised below. Companyâ&#x20AC;&#x2122;s name

Scenario Company Limited Channel [V] Music (Thailand) Company Limited Nadao Bangkok Company Limited Blue Media Communications Company Limited Max Creative Company Limited Big Event Company Limited

Paid-up capital as at 31 December

(Unit: Million Baht)

Total assets as at 31 December

2013

2012

2012

Total liabilities as at 31 December

2013

2012

Total revenues for the year ended 31 December

Profit (loss) for the year ended 31 December

2013

2013

2013

2012

2012

2012

70 85

70 85

992 61

985 100

176 9

182 10

845 53

1,127 95

127 (68)

240 7

2

2

32

23

23

17

74

47

3

-

5 5 5

5 5 -

14 14 4

6 22 -

10 10 -

3 17 -

6 -

3 29 -

1 (2) (1)

5 -


128

ANNUAL REPORT 2013

GMM GRAMMY

(Unit: Million Baht)

Companyâ&#x20AC;&#x2122;s name

Paid-up capital as at 31 December

2013 Town Branding Company Limited Happio Company Limited Myanmar Index Creative Village Company Limited TVMINDEX Advertising Company Limited Sawasdeethaweesuk Company Limited Family Know How Company Limited Ç° +4-Ç°$IBOOFMÇ°$PNQBOZÇ°-JNJUFEÇ° Lucks (666) Satellite Company Limited

Ç°

Total assets as at 31 December

2012

2013

Total liabilities as at 31 December

2012

2013

2012

Total revenues for the year ended 31 December

Profit (loss) for the year ended 31 December

2013

2013

2012

2012

5 9 33

-

14 8 49

-

21 1 13

-

10 3 52

-

(6) 3

-

4 4 50 Ç° 20

50 Ç° 20

6 8 193 Ç° 17

187 Ç° 29

8 3 73 Ç° 63

40 Ç° 37

11 3 192 Ç° 43

248 Ç° 51

(3) 1 3 Ç° (39)

59 

(11)

Ç° *OWFTUNFOUÇ°JOÇ°BTTPDJBUFTÇ°XJUIÇ°DBQJUBMÇ°EFĹłDJU The Group recognised share of losses from investment in three associates, as listed below, until the value of the investments approached zero. Subsequent losses incurred by those associates have not been recognised in the Groupâ&#x20AC;&#x2122;s accounts since the Group has no obligations, whether legal or constructive, to make any payments on behalf of those associates. The amount of such unrecognised share of losses is set out below. (Unit: Million Baht)

Companyâ&#x20AC;&#x2122;s name

Unrecognised share of losses Share of losses for the Cumulative share years ended of losses up to 31 December 31 December 2013

Ç° +4-Ç°$IBOOFMÇ°$PNQBOZÇ°-JNJUFEÇ° Lucks (666) Satellite Company Limited Town Branding Company Limited Total

2012  Ç° 6 1 4

2013 Ç° 1 1

2012 Ç° 11 1 12

 5 8


129

16. Other long-term investments (Unit: Thousand Baht)

Consolidated financial statements 2013 2012 Cost Securities available-for-sale Unit Trusts in Tisco Fixed - Income Fund SE-Education Public Company Limited Matichon Public Company Limited The Post Publishing Public Company Limited ǰ ǰ 0GųDF.BUFǰ1VCMJDǰ$PNQBOZǰ-JNJUFEǰ Total Add: Unrealised gains on changes in value of investments Less: Unrealised losses on changes in value of investments of subsidiary Securities available-for-sale - net 0UIFSǰJOWFTUNFOUT Siam Telemarketing Company Limited Karaoke Center Company Limited Lives and rich Company Limited A-Time Traveller Company Limited TVM INDEX Advertising Company Limited Total Less: Allowance for impairment of investments Other investments - net Others Government Savings Bank Bond Total others Total other long - term investments - net

3,197 225,147  ǰ 265,208 72,459 337,667

Fair Value 120 228,923  ǰ 337,667

Cost 3,197 225,147 455,499 972,572  ǰ 1,696,479 402,725 (604,111) 1,495,093

3,000 2,399 1,000 400 6,799 (4,000) 2,799

3,000 2,399 1,000 400 2,210 9,009 (4,000) 5,009

2,014 2,014 342,480

2,014 2,014 1,502,116

Fair Value 123 436,946 278,800 545,160  ǰǰǰ 1,495,093


130

ANNUAL REPORT 2013

GMM GRAMMY

(Unit: Thousand Baht)

Separate financial statements 2013 2012 Cost Securities available-for-sale Unit Trusts in Tisco Fixed - Income fund SE-Education Public Company Limited Ç° Ç° 0GĹłDF.BUFÇ°1VCMJDÇ°$PNQBOZÇ°-JNJUFEÇ° Total Add: Unrealised gains on changes in value of investments Securities available-for-sale - net 0UIFSÇ°JOWFTUNFOUT Siam Telemarketing Company Limited Karaoke Center Company Limited Total Less: Allowance for impairment of investment Other investments - net Others Government Savings Bank Bond Total others Total other long-term investments - net

Ç°

Ç°

3,197 225,147  Ç° 265,208 72,459 337,667

Fair Value 120 228,923  Ç° 337,667

Cost 3,197 225,147  Ç° 268,408 402,725 671,133

3,000 2,399 5,399 (3,000) 2,399

3,000 2,399 5,399 (3,000) 2,399

1,014 1,014 341,080

1,014 1,014 674,546

Fair Value 123 436,946  Ç°Ç°Ç° 671,133

During the current year, the Company sold the 320,000 ordinary shares comprising its investment in the ordinary shares of 0GĹłDF.BUFÇ°1VCMJDÇ°$PNQBOZÇ°-JNJUFEÇ°BUÇ°BÇ°QSJDFÇ°PGÇ°#BIUÇ°Ç°Ç°Ç°QFSÇ°TIBSF Ç°GPSÇ°BÇ°UPUBMÇ°PGÇ°#BIUÇ°Ç°NJMMJPOÇ°*OÇ°BEEJUJPO Ç°(..Ç°.FEJBÇ° Public Company Limited, a subsidiary, sold the 118,000,000 ordinary shares comprising its investment in the ordinary shares of The Post Publishing Public Company Limited at a price of Baht 8.25 per share, for a total of Baht 973 million and sold the 41,000,000 ordinary shares comprising its investment in the ordinary shares of Matichon Publishing Public Company Limited at a price of Baht 11.11 per share, for a total of Baht 456 million. The differences between net disposal proceeds and the carrying amount of UIFÇ°JOWFTUNFOUÇ°XFSFÇ°SFDPHOJTFEÇ°JOÇ°QSPĹłUÇ°PSÇ°MPTT During the current year, the Company and its subsidiary received dividend from other long-term investments amounted to Baht 34 million (the Company only: Baht 6 million). The Company also received a stock dividend of 4.5 million shares with a value of Baht 0.1 per share from SE-Education Public Company Limited.


144,863 156,053

-

144,863 11,190 156,053

358,603 787,754

424,091 89,302 (58,559) 454,834

782,694 44,966 (69,130) 484,058 1,242,588

481,331 564,661

747,938 157,950 (26,158) 879,730

1,229,269 244,676 (33,364) 3,810 1,444,391

99,001 100,092

354,984 54,733 (45,579) 364,138

453,985 58,738 (48,493) 464,230

75,424 82,604

231,472 25,967 (17,459) 239,980

306,896 33,196 (20,292) 2,784 322,584

Depreciation for the year 2012 (Baht 107 million included in cost of sales and services, and the balance in selling and administrative expenses) 2013 (Baht 105 million included in cost of sales and services, and the balance in selling and administrative expenses)

Ç° /FUÇ°CPPLÇ°WBMVF 31 December 2012 31 December 2013

Ç° "DDVNVMBUFEÇ°EFQSFDJBUJPO 31 December 2012 Depreciation for the year Accumulated depreciation on disposals 31 December 2013

$PTU 31 December 2012 Additions Disposals Transfers in / (out) 31 December 2013

17. Property, plant and equipment

73,804 65,574

171,474 22,290 (17,967) 175,797

245,278 16,107 (20,014) 241,371

398,211 28,271

-

398,211 121,803 (1,091) (490,652) 28,271

-

645 645

645 645

297,832 350,242

1,631,237 1,785,009

1,930,604 350,242 (165,722) 2,115,124

3,561,841 530,676 (192,384) 3,900,133

(Unit: Thousand Baht)

131


144,863 144,863

287,968 358,603

430,439 51,821 (58,169) 424,091

718,407 102,234 (62,622) 24,675 782,694

381,510 481,331

670,126 140,425 (62,613) 747,938

1,051,636 171,035 (75,682) 82,280 1,229,269

69,064 99,001

329,135 53,948 (28,099) 354,984

398,199 78,266 (28,663) 6,183 453,985

47,508 75,424

237,222 21,432 (27,182) 231,472

284,730 41,072 (29,536) 10,630 306,896

Depreciation for the year 2011 (Baht 120 million included in cost of sales and services, and the balance in selling and administrative expenses) 2012 (Baht 107 million included in cost of sales and services, and the balance in selling and administrative expenses)

/FUÇ°CPPLÇ°WBMVF 31 December 2011 31 December 2012

"DDVNVMBUFEÇ°EFQSFDJBUJPO 31 December 2011 Depreciation for the year Accumulated depreciation on disposals 31 December 2012

144,863 144,863

67,187 73,804

164,160 30,206 (22,892) 171,474

231,347 37,732 (23,801) 245,278

76,909 398,211

-

76,909 445,070 (123,768) 398,211

-

645 645

645 645

269,801 297,832

1,075,009 1,631,237

1,831,727 297,832 (198,955) 1,930,604

2,906,736 875,409 (220,304) 3,561,841

ANNUAL REPORT 2013

$PTUÇ° 31 December 2011 Additions Disposals Transfers in/(out) 31 December 2012

(Unit: Thousand Baht)

132 GMM GRAMMY


133

(Unit: Thousand Baht)

$PTU 31 December 2012 Additions Disposals 31 December 2013 "DDVNVMBUFEÇ°EFQSFDJBUJPO 31 December 2012 Depreciation for the year Accumulated depreciation on disposals 31 December 2013 /FUÇ°CPPLÇ°WBMVF 31 December 2012 31 December 2013

Separate financial statements Furniture Computer Motor and fixtures and vehicles and office equipment equipment

Building and building improvement

Operating equipment

Construction in progress and equipment under installation

218,420 16,582 (6,453) 228,549

78,874 9,111 (10,192) 77,793

114,631 14,134 (5,811) 122,954

214,983 24,224 (12,021) 227,186

115,636 10,696 (7,703) 118,629

1,060 1,060

742,544 75,807 (42,180) 776,171

193,227 11,294

59,132 7,187

103,685 5,666

192,348 16,790

84,893 11,205

-

633,285 52,142

(5,657) 198,864

(7,702) 58,617

(5,547) 103,804

(11,961) 197,177

(6,482) 89,616

-

(37,349) 648,078

25,193 29,685

19,742 19,176

10,946 19,150

22,635 30,009

30,743 29,013

1,060

109,259 128,093

Depreciation for the year 2012 (Baht 1 million included in cost of sales and services, and the balance in selling and administrative expenses) 2013 (Baht 1 million included in cost of sales and services, and the balance in selling and administrative expenses)

Total

62,794 52,142


134

ANNUAL REPORT 2013

GMM GRAMMY

(Unit: Thousand Baht)

$PTUÇ° 31 December 2011 Additions Disposals Transfers in/(out) 31 December 2012 "DDVNVMBUFEÇ°EFQSFDJBUJPO 31 December 2011 Depreciation for the year Accumulated depreciation on disposals 31 December 2012 /FUÇ°CPPLÇ°WBMVFÇ° 31 December 2011 31 December 2012

Separate financial statements Furniture Computer Motor and fixtures and vehicles and office equipment equipment

Building and building improvement

Operating equipment

Construction in progress and equipment under installation

225,923 7,576 (15,379) 300 218,420

79,676 4,907 (5,709) 78,874

120,528 3,905 (9,802) 114,631

208,675 14,763 (8,455) 214,983

113,017 20,845 (18,226) 115,636

1,220 (920) (300) -

747,819 53,216 (58,491) 742,544

195,335 12,506

54,221 8,079

106,299 5,316

176,222 23,236

84,095 13,657

-

616,172 62,794

(14,614) 193,227

(3,168) 59,132

(7,930) 103,685

(7,110) 192,348

(12,859) 84,893

-

(45,681) 633,285

30,588 25,193

25,455 19,742

14,229 10,946

32,453 22,635

28,922 30,743

-

131,647 109,259

Depreciation for the year 2011 (Baht 1 million included in cost of sales and services, and the balance in selling and administrative expenses) 2012 (Baht 1 million included in cost of sales and services, and the balance in selling and administrative expenses)

Ç°

Total

69,904 62,794

"TÇ°BUÇ°Ç°%FDFNCFSÇ° Ç°UIFÇ°(SPVQÇ°IBEÇ°WFIJDMFTÇ°BOEÇ°FRVJQNFOUÇ°VOEFSÇ°ĹłOBODFÇ°MFBTFÇ°BHSFFNFOUTÇ°XJUIÇ°OFUÇ°CPPLÇ°WBMVFTÇ°BNPVOUJOHÇ° to Baht 61 million (2012: Baht 74 million) (the Company only: Baht 29 million, 2012: Baht 33 million). As at 31 December 2013, the Group had certain building and equipment items have been fully depreciated but are still in use. The gross carrying amount (before deducting accumulated depreciation) of those assets amounted to approximately Baht 1,178 million (2012: Baht 1,188 million) (the Company only: Baht 471 million, 2012: Baht 444 million). Three subsidiaries have mortgaged land with structures thereon with a total net book value as at 31 December 2013 of Baht 800 million (2012: Baht 275 million) as collateral for bank overdraft, short-term and long-term credit facilities granted by commercial banks.


135

18. Intangible assets (Unit: Thousand Baht)

Copyrights to musical compositions $PTU 31 December 2012 Additions Transferred from inventories Internal creation Written off 31 December 2013 "DDVNVMBUFEÇ°BNPSUJTBUJPO 31 December 2012 Amortisation for the year Accumulated amortisation on written off 31 December 2013 Ç° "MMPXBODFÇ°GPSÇ°JNQBJSNFOUÇ°MPTTÇ°POÇ°BTTFUT 31 December 2012 31 December 2013 /FUÇ°CPPLÇ°WBMVF 31 December 2012 31 December 2013

Consolidated financial statements Computer Program rights Motion picture software and cartoon copyrights, games licenses and other rights

Total

304,609 9,742

258,784 36,334

1,298,727 209,565

1,535,186 2,567

3,397,306 258,208

6,503 320,854

(3,593) 291,525

(39,655) 1,468,637

125,415 (12,201) 1,650,967

131,918 (55,449) 3,731,983

118,051 185 118,236

155,844 28,812 (2,853) 181,803

335,931 201,073 (1,233) 535,771

1,447,669 146,624 (10,557) 1,583,736

2,057,495 376,694 (14,643) 2,419,546

-

-

-

20,132 20,132

20,132 20,132

186,558 202,618

102,940 109,722

962,796 932,866

67,385 47,099

1,319,679 1,292,305

Ç° "NPSUJTBUJPOÇ°GPSÇ°UIFÇ°ZFBS 2012 (Baht 458 million included in cost of sales and services, and the balance in selling and administrative expenses) 2013 (Baht 153 million included in cost of sales and services, and the balance in selling and administrative expenses)

508,288 376,694


136

ANNUAL REPORT 2013

GMM GRAMMY

(Unit: Thousand Baht)

Copyrights to musical compositions Ç° $PTU 31 December 2011 Additions Transferred from inventories Internal creation Written off 31 December 2012 Ç° "DDVNVMBUFEÇ°BNPSUJTBUJPO 31 December 2011 Amortisation for the year Accumulated amortisation on written off 31 December 2012 "MMPXBODFÇ°GPSÇ°JNQBJSNFOUÇ°MPTTÇ°POÇ°BTTFUT 31 December 2011 Decrease during the year 31 December 2012 /FUÇ°CPPLÇ°WBMVF 31 December 2011 31 December 2012

Consolidated financial statements Computer Program rights Motion picture software and cartoon copyrights, games licenses and other rights

Total

291,598 928

222,320 37,295

153,904 1,308,275

1,425,908 11,816

2,093,730 1,358,314

12,801 (718) 304,609

(831) 258,784

(163,452) 1,298,727

97,462 1,535,186

110,263 (165,001) 3,397,306

118,338 (287) 118,051

131,631 24,763 (550) 155,844

335,931 335,931

1,300,075 147,594 1,447,669

1,550,044 508,288 (837) 2,057,495

431 (431) -

-

-

20,132 20,132

20,563 (431) 20,132

172,829 186,558

90,689 102,940

153,904 962,796

105,701 67,385

523,123 1,319,679

Ç° "NPSUJTBUJPOÇ°GPSÇ°UIFÇ°ZFBS 2011 (Baht 121 million included in cost of sales and services, and the balance in selling and administrative expenses) 2012 (Baht 458 million included in cost of sales and services, and the balance in selling and administrative expenses)

145,468 508,288


137

(Unit: Thousand Baht)

Copyrights to musical compositions

$PTU 31 December 2012 Additions Transferred from inventories Internal creation Written off 31 December 2013

Separate financial statements Computer Program rights Motion picture software and cartoon copyrights, games licenses and other rights

Total

348,805 13,861

146,850 18,979

321,409 69,942

368,590 19

1,185,654 102,801

6,503 369,169

(188) 165,641

391,351

27,465 (7,500) 388,574

33,968 (7,688) 1,314,735

130,516 385 130,901

87,527 12,812 (181) 100,158

317,931 20,225 338,156

330,160 28,414 (7,500) 351,074

866,134 61,836 (7,681) 920,289

-

-

-

4,264 4,264

4,264 4,264

218,289 238,268

59,323 65,483

3,478 53,195

34,166 33,236

315,256 390,182

"NPSUJTBUJPOÇ°GPSÇ°UIFÇ°ZFBS 2012 (Baht 358 million included in cost of sales and services, and the balance in selling and administrative expenses) 2013 (Baht 49 million included in cost of sales and services, and the balance in selling and administrative expenses)

372,732 61,836

"DDVNVMBUFEÇ°BNPSUJTBUJPO 31 December 2012 Amortisation for the year Accumulated amortisation on written off 31 December 2013 "MMPXBODFÇ°GPSÇ°JNQBJSNFOUÇ°MPTTÇ°POÇ°BTTFUT 31 December 2012 31 December 2013 /FUÇ°CPPLÇ°WBMVF 31 December 2012 31 December 2013


138

ANNUAL REPORT 2013

GMM GRAMMY

(Unit: Thousand Baht)

Copyrights to musical compositions

$PTU 31 December 2011 Additions Transferred from inventories Internal creation Written off 31 December 2012

Separate financial statements Computer Program rights Motion picture software and cartoon copyrights, games licenses and other rights

Total

336,004 -

144,207 3,070

153,904 374,496

363,556 5,034

997,671 382,600

12,801 348,805

(427) 146,850

(206,991) 321,409

368,590

12,801 (207,418) 1,185,654

130,516 130,516

73,537 14,197 (207) 87,527

317,931 317,931

289,556 40,604 330,160

493,609 372,732 (207) 866,134

-

-

-

4,264 4,264

4,264 4,264

205,488 218,289

70,670 59,323

153,904 3,478

69,736 34,166

499,798 315,256

Ç° "NPSUJTBUJPOÇ°GPSÇ°UIFÇ°ZFBS 2011 (Baht 16 million included in cost of sales and services, and the balance in selling and administrative expenses) 2012 (Baht 358 million included in cost of sales and services, and the balance in selling and administrative expenses)

40,274 372,732

"DDVNVMBUFEÇ°BNPSUJTBUJPO 31 December 2011 Amortisation for the year Accumulated amortisation on written off 31 December 2012 Ç° "MMPXBODFÇ°GPSÇ°JNQBJSNFOUÇ°MPTTÇ°POÇ°BTTFUT 31 December 2011 31 December 2012 /FUÇ°CPPLÇ°WBMVF 31 December 2011 31 December 2012

(Unit: Thousand Baht)

Consolidated financial statements Separate financial statements Intangible assets Less: realise within one year (Note 12) Intangible assets - net of realise within one year

2013

2012

2013

2012

1,292,305 (762,127) 530,178

1,319,679 (185,116) 1,134,563

390,182 (21,292) 368,890

315,256 315,256


139

Ç° Ç° Ç°

Ç°

As at 31 December 2013, the Group had certain computer software items have been fully amortised but are still in use. The gross carrying amount (before deducting accumulated amortisation) of those assets amounted to approximately Baht 65 million (2012: Baht 64 million) (the Company only: Baht 32 million, 2012: Baht 27 million). 5IFÇ°DPQZSJHIUTÇ°UPÇ°NVTJDBMÇ°DPNQPTJUJPOTÇ°IBWFÇ°UIFÇ°JOEFĹłOJUFÇ°VTFGVMÇ°MJWFTÇ°CFDBVTFÇ°UIFZÇ°BSFÇ°FYQFDUFEÇ°UPÇ°DPOUSJCVUFÇ°UPÇ°UIFÇ°(SPVQÄ´TÇ° OFUÇ°DBTIÇ°JOĹ´PXTÇ°JOEFĹłOJUFMZÇ°5IFSFGPSF Ç°UIFÇ°DPQZSJHIUTÇ°UPÇ°NVTJDBMÇ°DPNQPTJUJPOTÇ°XPVMEÇ°OPUÇ°CFÇ°BNPSUJTFEÇ°VOUJMÇ°UIFJSÇ°VTFGVMÇ°MJWFTÇ° BSFÇ°EFUFSNJOFEÇ°UPÇ°CFÇ°ĹłOJUFÇ° The value of the copyrights in such musical compositions depends on the popularity of the artist and possibility of further distribution or re-release of such compositions. However, the management of the Group believes that the compositions will HFOFSBUFÇ°GVUVSFÇ°CFOFĹłUTÇ°JOÇ°FYDFTTÇ°PGÇ°UIFJSÇ°OFUÇ°CPPLÇ°WBMVFTÇ°UISPVHIÇ°UIFJSÇ°SFSFMFBTFÇ°JOÇ°WBSJPVTÇ°GPSNT Ç°BOEÇ°UIFSFGPSFÇ°OPÇ°BMMPXBODFÇ° for impairment losses of deferred copyrights is required.

19. Other non-current assets

(Unit: Thousand Baht)

Consolidated financial statements Separate financial statements 2013 Deposit Deposit for digital TV spectrum license auction Leasehold right - net Prepaid expenses Others Total

203,615 189,000 28,707 118,502 539,824

2012 142,174 2,779 100,483 103,272 348,708

2013

2012

109,529 3,701 41,333 154,563

56,012 51,554 107,566

20. Bank overdrafts and short-term loans from banks (Unit: Thousand Baht)

Interest rate (percent per annum) Bank overdrafts Short-term loans from banks Trust receipts Total

Ç°

MOR - MOR+2% 3.08 - 6.38 MMR

Consolidated financial statements Separate financial statements 2013 2012 2013 2012 8,539 4,275,000 45,898 4,329,437

29,980 2,900,998 178,212 3,109,190

2,000,000 2,000,000

326,000 326,000

Bank overdrafts and short-term loans from banks of two subsidiaries are secured by the mortgage of the companyâ&#x20AC;&#x2122;s land with structures thereon and securities of unrelated party. The short-term loans from banks and trust receipts of four subsidiaries are guaranteed by the Company and co-investor, BOEÇ°DPOUBJOÇ°DFSUBJOÇ°DPWFOBOUTÇ°BOEÇ°SFTUSJDUJPOTÇ°5IFTFÇ°SFMBUFÇ°UP Ç°BNPOHÇ°PUIFSÇ°UIJOHT Ç°UIFÇ°NBJOUFOBODFÇ°PGÇ°UIFJSÇ°ĹłOBODJBMÇ°SBUJPT


140

ANNUAL REPORT 2013

GMM GRAMMY

21. Trade and other payables (Unit: Thousand Baht)

Consolidated financial statements Separate financial statements Trade payables - related parties Trade payables - unrelated parties Accrued cost - related parties Accrued cost - unrelated parties Other payables for purchase of assets - unrelated parties Accrued expenses Accrued commission Total trade and other payables

2013

2012

2013

2012

85,896 1,274,683 4,724 489,172 19,837 421,572 225,875 2,521,759

100,751 1,389,161 4,185 401,507 22,552 428,885 199,543 2,546,584

129,494 220,442 7,568 212,671 7,693 99,932 677,800

208,657 242,108 3,394 177,467 504 93,582 725,712

The balance of trade payables - unrelated parties consisted accounts payable - purchase of program rights from many overseas companies. As at 31 December 2013, the Group had trade payables - unrelated parties, not yet due within one year, amounting to Baht 54 million (2012: Baht 287 million) (the Company only: none, 2012: none).

22. Long - term loans The outstanding balances as of 31 December 2013 and 2012 consisted of:

(Unit: Thousand Baht)

Consolidated financial statements Separate financial statements 2013 22.1 A Baht loan amounting to Baht 35 million. Principal and interest are to be paid in 120 monthly installments commencing February 2008, with interest charged at the minimum loan rate (MLR) minus interest rate 1.50 percentage per annum for the Ç° Ç° Ç° Ç° Ç° ĹłSTUÇ°Ç°JOTUBMMNFOUTÇ°BOEÇ°UIFÇ°NJOJNVNÇ°MPBOÇ°SBUFÇ° .-3 Ç°NJOVTÇ° interest rate 0.50 percentage per annum after the 24th installment. 22.2 A Baht loan amounting to Baht 12 million. Principal and interest are to be paid in 84 monthly installments commencing March 2010, with interest charged at the minimum loan rate (MLR) minus interest rate 1.00 percentage per annum. 22.3 A Baht loan amounting to Baht 9 million. Principal and interest are to be paid in 24 monthly installments commencing August 2012, with interest charged at the minimum loan rate (MLR) minus interest rate 1.50 percentage per annum. 22.4 A Baht loan amounting to Baht 280 million (2012: Baht 145 million). Principal and interest are to be paid in monthly Ç° Ç° Ç° Ç° Ç° JOTUBMMNFOUTÇ°DPNNFODJOHÇ°+BOVBSZÇ° Ç°XJUIJOÇ°Ç°ZFBSTÇ°GSPNÇ° Ç° Ç° Ç° Ç° Ç° UIFÇ°NPOUIÇ°PGÇ°UIFÇ°ĹłSTUÇ°ESBXEPXOÇ°5IFÇ°JOUFSFTUÇ°DIBSHFEÇ°BUÇ°UIFÇ° Minimum Loan Rate (MLR) minus 0.5 - 2.0 percent per annum.

2012

2013

2012

Ç° -

Ç° 16,894

Ç° -

Ç° -

-

7,656

-

-

-

4,684

-

-

Ç° Ç° 280,000

Ç° Ç° 145,000

Ç° Ç° -

Ç° Ç° -


141

(Unit: Thousand Baht)

Consolidated financial statements Separate financial statements 2013 2012 2013 2012 22.5 A Baht loan amounting to Baht 280 million. Principal and interest are to be paid in 2 years installments commencing Ç° Ç° Ç° Ç° Ç° UIFÇ°ĹłSTUÇ°NPOUIÇ°PGÇ°ESBXEPXOÇ°VOEFSÇ°BHSFFNFOU Ç°XJUIÇ°JOUFSFTUÇ° charged at the minimum loan rate (MLR) minus interest rate 1.75 percentage per annum. 22.6 A Baht loan amounting to Baht 30 million. Principal and interest Ç° Ç° Ç° Ç° Ç° BSFÇ°UPÇ°CFÇ°QBJEÇ°JOÇ°Ç°NPOUIMZÇ°JOTUBMMNFOUTÇ°DPNNFODJOHÇ°+BOVBSZÇ°Ç° 2014, with interest charged at the minimum loan rate (MLR). Total Less: Current portion due within one year Long-term loans , net of current portion

Ç°

Ç°

Ç°

Ç°

Ç°

-

280,000

-

280,000

Ç° 30,000 310,000 (28,848) 281,152

Ç° 454,234 (301,348) 152,886

Ç° -

Ç° 280,000 (280,000) -

The long-term loans in Note 22.4 and 22.6 are guaranteed by directors of the subsidiaries and secured by the mortgage of land and structures thereon of the subsidiaries. These guarantees are effective so long as the underlying obligations have not been discharged by the subsidiaries. The loan agreements contain certain covenants and restrictions. These relate to, among other things, the NBJOUFOBODFÇ°PGÇ°UIFJSÇ°ĹłOBODJBMÇ°SBUJPT

23. Liabilities under finance lease agreements

(Unit: Thousand Baht)

Consolidated financial statements Separate financial statements 2013 2012 2013 2012 Ç° -JBCJMJUJFTÇ°VOEFSÇ°ĹłOBODFÇ°MFBTFÇ°BHSFFNFOUTÇ° Less: Deferred interest expenses Total Less: Current portion due within one year Ç° -JBCJMJUJFTÇ°ĹłOBODFÇ°MFBTFÇ°BHSFFNFOUTÇ°Ç°OFUÇ°PGÇ°DVSSFOUÇ°QPSUJPOÇ° Ç°

Ç°

 Ç° (8,215) 59,278 (18,721)  Ç°

 Ç° (8,694) 68,085 (22,784)  Ç°

 Ç° (5,062) 33,801 (9,993)  Ç°

  (4,579) 35,874 (11,555)  Ç°

5IFÇ°(SPVQÇ°IBTÇ°FOUFSFEÇ°JOUPÇ°UIFÇ°ĹłOBODFÇ°MFBTFÇ°BHSFFNFOUTÇ°XJUIÇ°MFBTJOHÇ°DPNQBOJFTÇ°GPSÇ°SFOUBMÇ°PGÇ°NPUPSÇ°WFIJDMFTÇ°BOEÇ°FRVJQNFOUÇ°GPSÇ° use in its operation, whereby it is committed to pay rental on a monthly basis. The terms of the agreements are generally between 3 and 5 years. Finance lease agreements are non-cancellable. "TÇ°BUÇ°Ç°%FDFNCFSÇ°Ç°BOEÇ° Ç°GVUVSFÇ°NJOJNVNÇ°MFBTFÇ°QBZNFOUTÇ°SFRVJSFEÇ°VOEFSÇ°UIFÇ°ĹłOBODFÇ°MFBTFÇ°BHSFFNFOUTÇ°BSFÇ°BTÇ°GPMMPXT (Unit: Million Baht)

Consolidated financial statements As at 31 December 2013 Less than 1 year 1-5 years Over 5 years Future minimum lease payments Deferred interest expenses Present value of future minimum lease payments

22 (3) 19

45 (5) 40

-

Total

67 (8) 59


142

ANNUAL REPORT 2013

GMM GRAMMY

(Unit: Million Baht)

Consolidated financial statements As at 31 December 2012 Less than 1 year 1-5 years Over 5 years Future minimum lease payments Deferred interest expenses Present value of future minimum lease payments

27 (4) 23

50 (5) 45

Total

-

77 (9) 68

(Unit: Million Baht)

Separate financial statements As at 31 December 2013 Less than 1 year 1-5 years Over 5 years Future minimum lease payments Deferred interest expenses Present value of future minimum lease payments

12 (2) 10

27 (3) 24

Total

-

39 (5) 34

(Unit: Million Baht)

Separate financial statements As at 31 December 2012 Less than 1 year 1-5 years Over 5 years Future minimum lease payments Deferred interest expenses Present value of future minimum lease payments

14 (2) 12

27 (3) 24

Total

-

41 (5) 36

24. Other current liabilities (Unit: Thousand Baht)

Consolidated financial statements Separate financial statements 2013 Undue output tax Provision for sales returns Others Total

202,084 140,124 94,989 437,197

2012 233,671 32,036 170,792 436,499

2013

2012

99,558 27,591 9,455 136,604

87,794 28,127 14,919 130,840


143

25. Provision for long-term employee benefits Ç°

1SPWJTJPOǰGPSǰMPOHUFSNǰFNQMPZFFǰCFOFųUT ǰXIJDIǰJTǰDPNQFOTBUJPOTǰPOǰFNQMPZFFTĴǰSFUJSFNFOU ǰXBTǰBTǰGPMMPXT (Unit: Thousand Baht)

Consolidated financial statements Separate financial statements 2013 ǰ %FųOFEǰCFOFųUǰPCMJHBUJPOǰBUǰCFHJOOJOHǰPGǰZFBS Current service cost Interest cost ǰ #FOFųUTǰQBJEǰEVSJOHǰUIFǰZFBSǰ Actuarial loss 1SPWJTJPOTǰGPSǰMPOHUFSNǰFNQMPZFFǰCFOFųUTǰBUǰFOEǰPGǰZFBSǰ

Ç°

2012

260,840 30,334 9,212   Ç° 41,197 335,038

232,055 22,391 8,615   Ç° 260,840

2013

2012

119,257 15,155 5,496   Ç° 7,034 142,600

108,498 6,981 3,778  119,257

-POHUFSNǰFNQMPZFFǰCFOFųUǰFYQFOTFTǰJODMVEFEǰJOǰUIFǰQSPųUǰPSǰMPTTǰXBTǰBTǰGPMMPXT (Unit: Thousand Baht)

Consolidated financial statements Separate financial statements 2013 Current service cost Interest cost 5PUBMǰFYQFOTFǰSFDPHOJ[FEǰJOǰQSPųUǰPSǰMPTT ǰ -JOFǰJUFNTǰVOEFSǰXIJDIǰTVDIǰFYQFOTFTǰBSFǰJODMVEFEǰJOǰQSPųUǰPSǰMPTT Cost of sales and services Selling and administrative expenses

2012

2013

2012

30,334 9,212 39,546

22,391 8,615 31,006

15,155 5,496 20,651

6,981 3,778 10,759

479 39,067

447 30,559

27 20,624

54 10,705

Principal actuarial assumptions at the valuation date were as follows: Consolidated financial statements Separate financial statements 2013 2012 2013 2012 (% per annum) (% per annum) (% per annum) (% per annum) Discount rate Future salary increase rate (depending on age and job position of employee) ǰ *OŴBUJPOǰSBUFǰ GPSǰPUIFSǰųYFEǰJODPNF ǰ ǰ ǰ ǰ ǰ ǰ ǰǰǰǰǰǰǰǰǰǰǰǰǰǰǰǰǰ

3.75

4.50

3.75

4.50

5.00 - 6.00 ǰGPSǰUIFǰ ųSTUǰǰZFBSTǰ and 2.50 afterward

4.00 - 6.00 ǰGPSǰUIFǰ ųSTUǰǰZFBSTǰ and 2.50 afterward

5.00 ǰGPSǰUIFǰ ųSTUǰǰZFBSTǰ and 2.50 afterward

4.00 ǰGPSǰUIFǰ ųSTUǰǰZFBST and 2.50 afterward


144

ANNUAL REPORT 2013

GMM GRAMMY

26. Share Capital

On 9 August 2013, the Extraordinary General Meeting of the Companyâ&#x20AC;&#x2122;s Shareholders no. 1/2556 passed resolutions on the following matters. a) Approval was given to decrease the Companyâ&#x20AC;&#x2122;s registered share capital from Baht 530.56 million (530.56 million ordinary shares of Baht 1 each) to Baht 530.26 million (530.26 million ordinary shares of Baht 1 each), by canceling 291,153 registered shares that had yet to be allocated. b) Approval was given to increase the Companyâ&#x20AC;&#x2122;s registered share capital from Baht 530.26 million (530.26 million ordinary shares of Baht 1 each) to Baht 636.32 million (636.32 million ordinary shares of Baht 1 each) for support the issuance of new shares to existing shareholders (Rights Offering) according to Pro rata basis of shares. In September 2013, the Company offered newly issued ordinary shares to their shareholding percentage (Rights Offering) in the ratio of 5 existing ordinary shares to 1 new ordinary share, at an offer price of Baht 10 each. The shares were sold and total proceeds from the share issuance were Baht 1,061 million, with a share premium of Baht 954 million. The Company registered the resulting change in its paid-up capital with the Ministry of Commerce on 11 September 2013.

27. Statutory reserve Ç°

Pursuant to Section 116 of the Public Limited Companies Act B.E. 2535, the Company is required to set aside to a statutory reserve BUÇ°MFBTUÇ°Ç°QFSDFOUÇ°PGÇ°JUTÇ°OFUÇ°QSPĹłUÇ°BGUFSÇ°EFEVDUJOHÇ°BDDVNVMBUFEÇ°EFĹłDJUÇ°CSPVHIUÇ°GPSXBSEÇ° JGÇ°BOZ Ç°VOUJMÇ°UIFÇ°SFTFSWFÇ°SFBDIFTÇ°Ç°QFSDFOUÇ° of the registered capital. The statutory reserve is not available for dividend distribution. At present, the statutory reserve has fully been set aside.

28. Expenses by nature Ç°

4JHOJĹłDBOUÇ°FYQFOTFTÇ°CZÇ°OBUVSFÇ°BSFÇ°BTÇ°GPMMPXT (Unit: Thousand Baht)

Consolidated financial statements Separate financial statements Ç° 4BMBSZÇ°BOEÇ°XBHFTÇ°BOEÇ°PUIFSÇ°FNQMPZFFÇ°CFOFĹłUTÇ° Depreciation Amortisation Rental expenses from operating agreements Raw materials and consumables used Ç° $IBOHFTÇ°JOÇ°JOWFOUPSJFTÇ°PGÇ°ĹłOJTIFEÇ°HPPETÇ°BOEÇ°XPSLÇ°JOÇ°QSPHSFTTÇ°

2013

2012

2013

2012

  Ç° 350,242 376,694 1,077,787 14,031  Ç°

  Ç° 297,832 508,288 1,115,420 6,090   Ç°

 Ç° 52,142 61,836 112,785 8,128  Ç°

  62,794 372,732 108,699 5,979  

29. Income tax Income tax expenses for the years ended 31 December 2013 and 2012 are made up as follows:

(Unit: Thousand Baht)

Consolidated financial statements Separate financial statements 2013 2012 2013 2012 (Restated) (Restated) $VSSFOUÇ°JODPNFÇ°UBYÇ°Ç° Current income tax charge %FGFSSFEÇ°UBYÇ° Relating to origination and reversal of temporary differences *ODPNFÇ°UBYÇ°FYQFOTFÇ°SFQPSUFEÇ°JOÇ°UIFÇ°JODPNFÇ°TUBUFNFOU

(169,733)

(221,637)

(11,169)

(27,842)

78,522 (91,211)

37,368 (184,269)

45,600 34,431

5,722 (22,120)


145

The amounts of income tax relating to each component of other comprehensive income for the years ended 31 December 2013 and 2012 are as follows:

(Unit: Thousand Baht)

Consolidated financial statements Separate financial statements 2013 2012 2013 2012 (Restated) (Restated) Deferred tax relating to actuarial losses Deferred tax relating to gain (loss) on change in value of available-for-sale investments

Ç°

8,239

-

1,407

-

66,053 74,292

(31,703) (31,703)

66,053 67,460

(31,703) (31,703)

3FDPODJMJBUJPOÇ°CFUXFFOÇ°JODPNFÇ°UBYÇ°FYQFOTFTÇ°BOEÇ°UIFÇ°QSPEVDUÇ°PGÇ°BDDPVOUJOHÇ°QSPĹłUÇ°NVMUJQMJFEÇ°CZÇ°UIFÇ°BQQMJDBCMFÇ°UBYÇ°SBUFTÇ°GPSÇ°UIFÇ° years ended 31 December 2013 and 2012 are as follow: (Unit: Thousand Baht)

Consolidated financial statements Separate financial statements 2013 2012 2013 2012 (Restated) (Restated) Ç° "DDPVOUJOHÇ°QSPĹłUÇ° MPTT Ç°CFGPSFÇ°UBYÇ° Applicable tax rate of the Company Ç° "DDPVOUJOHÇ°QSPĹłUÇ° MPTT Ç°CFGPSFÇ°UBYÇ°NVMUJQMJFEÇ°CZÇ°BQQMJDBCMFÇ°UBYÇ°SBUFÇ° Effects of changes in the applicable tax rates Effects about tax losses Ç° &GGFDUTÇ°PGÇ°QSFQBSJOHÇ°UIFÇ°DPOTPMJEBUFEÇ°ĹłOBODJBMÇ°TUBUFNFOUTÇ° Ç° 4IBSFÇ°PGÇ°QSPĹłUÇ°GSPNÇ°JOWFTUNFOUTÇ°JOÇ°BTTPDJBUFTÇ° Difference in tax rate in group companies Effects of : Promotional privileges (Note 30) Ç° Ç° %JWJEFOETÇ°SFDFJWFEÇ°BSFÇ°FYDMVEFEÇ°GSPNÇ°UBYBCMFÇ°QSPĹłUÇ° Non-deductible expenses Additional expense deductions allowed Others Total Income tax expenses reported in the income statement

   Ç° 20%   Ç° 336,410   Ç°   Ç° 379

  Ç° 23%   Ç° 5,464 203,635 Ç°   Ç° 886

 Ç° 20%  Ç° Ç° Ç° -

  23%   858   -

(8,310)   Ç° 34,456 (1,300) 23,205 91,211

(5,330)   Ç° 27,085 (4,668) 120 9,287 184,269

  Ç° 16,241 (256) 8,600 (78,385) (34,431)

 

24,218 (1,017) (9,771) (72,722) 22,120

The tax rates enacted at the end of the reporting period of the Company and its subsidiaries is 0% to 20% (2012: 0% to 23%).


146

ANNUAL REPORT 2013

GMM GRAMMY

The components of deferred tax assets and deferred tax liabilities are as follows: (Unit: Thousand Baht)

Statements of financial position Consolidated financial statements Separate financial statements As at As at 31 December 31 December 2013 2012 (Restated) Deferred tax assets Allowance for doubtful accounts Allowance for diminution in value of inventories Allowance for asset impairment Accumulated depreciation - Plant and equipment Accumulated amortisation Computer software Ç° Ç° 1SPWJTJPOÇ°GPSÇ°MPOHUFSNÇ°FNQMPZFFÇ°CFOFĹłUTÇ° Provision for sales returns Unused tax loss Total Deferred tax liabilities Unrealised gain from changes in value of investments - Current investments - Securities available-for-sale Total

As at 1 January 2012

As at As at 31 December 31 December 2013 2012 (Restated)

As at 1 January 2012

17,303

19,068

19,587

6,823

8,969

10,670

66,884 534

25,178 534

20,405 534

66,296 -

24,419 -

19,711 -

217

234

251

-

-

-

3,798  Ç° 5,641 80,918 242,152

 Ç° 6,028 52,433 155,562

 Ç° 5,313 26,073 118,081

2,715  Ç° 5,518 109,872

 Ç° 5,626 62,865

  5,063 57,144

15 14,491 14,506

186 80,544 80,730

73 48,841 48,914

14,491 14,491

80,544 80,544

48,841 48,841

In October 2011, the cabinet passed a resolution to reduce the corporate income tax rate from 30 percent to 23 percent in 2012, and then to 20 percent from 2013. In addition, in order to comply with the resolution of the cabinet, in December 2011, the EFDSFBTFTÇ°JOÇ°UBYÇ°SBUFTÇ°GPSÇ°Ç°Ç°Ç°XFSFÇ°FOBDUFEÇ°UISPVHIÇ°BÇ°3PZBMÇ°%FDSFFÇ°5IFÇ°$PNQBOZÇ°IBTÇ°SFĹ´FDUFEÇ°UIFÇ°DIBOHFTÇ°JOÇ°UIFÇ°JODPNFÇ° tax rates in its deferred tax calculation, as presented above. As at 31 December 2013 the Group has deductible temporary differences and unused tax losses totaling Baht 526 million (2012: Baht 228 million) (the Company only: none, 2012: none), on which deferred tax assets have not been recognised as the Group CFMJFWFTÇ°GVUVSFÇ°UBYBCMFÇ°QSPĹłUTÇ°NBZÇ°OPUÇ°CFÇ°TVGĹłDJFOUÇ°UPÇ°BMMPXÇ°VUJMJTBUJPOÇ°PGÇ°UIFÇ°UFNQPSBSZÇ°EJGGFSFODFTÇ°BOEÇ°VOVTFEÇ°UBYÇ°MPTTFT

Ç°

Ç°

30. Promotional privileges A subsidiary has received promotional privileges from the Board of Investment for the lease of studio, motion graphic and multimedia TFSWJDF Ç°QVSTVBOUÇ°UPÇ°UIFÇ°QSPNPUJPOÇ°DFSUJĹłDBUF Ç°XIJDIÇ°BSFÇ°TVNNBSJ[FEÇ°BTÇ°GPMMPX

Ç° Item

Certificate No.

Date

1

1980(2)/2554

11 August 2011

2

2171(2)/2554

3

2378(2)/2554

For

Lease of studio, Motion Graphic and multimedia service 20 September 2011 Motion Graphic and multimedia service 30 November 2011 Lease of studio

Income tax privileges (years)

Date of the first income derived

5

28 May 2012

5

31 October 2011

5

31 May 2012


147

Ç° Ç°

4VCKFDUÇ°UPÇ°DFSUBJOÇ°JNQPTFEÇ°DPOEJUJPO Ç°UIFÇ°QSJWJMFHFTÇ°JODMVEFÇ°BOÇ°FYFNQUJPOÇ°GSPNÇ°DPSQPSBUFÇ°JODPNFÇ°UBYÇ°POÇ°QSPĹłUTÇ°GSPNÇ°UIFÇ°QSPNPUFEÇ° PQFSBUJPOT Ç°GPSÇ°BÇ°QFSJPEÇ°PGÇ°Ç°ZFBSTÇ°DPNNFODJOHÇ°BTÇ°GSPNÇ°UIFÇ°EBUFÇ°PGÇ°UIFÇ°ĹłSTUÇ°FBSOJOHTÇ°PQFSBUJOHÇ°JODPNF Ç°UPÇ°UIFÇ°FYUFOUÇ°UIBUÇ°UIFÇ° amount of tax exempted does not exceed 100% of the total investment made excluding the price of land and working capital. The subsidiaryâ&#x20AC;&#x2DC;s operating revenues for the year are below shown divided according to promoted and non - promoted operations, are summarised as follow: (Unit: Thousand Baht) Promoted operation Non - promoted operation Total 2013 2012 2013 2012 2013 2012 Revenues from lease of studio

84,069

53,330

67

119

84,136

53,449

31. Earnings per share Ç°

#BTJDÇ°FBSOJOHTÇ°QFSÇ°TIBSFÇ°JTÇ°DBMDVMBUFEÇ°CZÇ°EJWJEJOHÇ°QSPĹłUÇ° MPTT Ç°GPSÇ°UIFÇ°ZFBSÇ°BUUSJCVUBCMFÇ°UPÇ°FRVJUZÇ°IPMEFSTÇ°PGÇ°UIFÇ°$PNQBOZÇ° FYDMVEJOHÇ° other comprehensive income) by the weighted average number of ordinary shares in issue during the year. Basic earnings per share are calculated below. Consolidated financial statements Separate financial statements 2013 2012 2013 2012 (Restated) (Restated)

Ç° 1SPĹłUÇ° MPTT Ç°BUUSJCVUBCMFÇ°UPÇ°FRVJUZÇ°IPMEFSTÇ°PGÇ°UIFÇ°1BSFOUÇ°Ç° (Thousand Baht) Weighted average number of ordinary shares (Thousand shares) Basic earnings per share (Baht/share)

Ç°

(1,282,710) 564,607 (2.27)

Ç°

(322,063) 530,265 (0.61)

Ç°

254,203 564,607 0.45

Ç°

386,505 530,265 0.73

32. Segment information Ç°

Ç° Ç°

Operating segment information is reported in a manner consistent with the internal reports that are regularly reviewed by the chief operating decision maker in order to make decisions about the allocation of resources to the segment and assess its QFSGPSNBODFÇ°5IFÇ°DIJFGÇ°PQFSBUJOHÇ°EFDJTJPOÇ°NBLFSÇ°IBTÇ°CFFOÇ°JEFOUJĹłFEÇ°BTÇ°#PBSEÇ°PGÇ°%JSFDUPSTÇ°BOEÇ°&YFDVUJWFÇ°$PNNJUUFFÇ°PGÇ°UIFÇ°(SPVQ For management purposes, the Group is organised into business units based on its businesses and have four principal reportable segments i.e. music business, media business (radio, television, motion pictures and publishing), broadcasting business and marketing events business. These operations are mainly carried on in Thailand. The chief operating decision maker monitors the operating results of the business units separately for the purpose of making EFDJTJPOTÇ°BCPVUÇ°SFTPVSDFÇ°BMMPDBUJPOÇ°BOEÇ°BTTFTTJOHÇ°QFSGPSNBODFÇ°4FHNFOUÇ°QFSGPSNBODFÇ°JTÇ°NFBTVSFEÇ°CBTFEÇ°POÇ°PQFSBUJOHÇ°QSPĹłUÇ°PSÇ° MPTTÇ°BOEÇ°POÇ°BÇ°CBTJTÇ°DPOTJTUFOUÇ°XJUIÇ°UIBUÇ°VTFEÇ°UPÇ°NFBTVSFÇ°PQFSBUJOHÇ°QSPĹłUÇ°PSÇ°MPTTÇ°JOÇ°UIFÇ°ĹłOBODJBMÇ°TUBUFNFOUTÇ° The basis of accounting for any transactions between reportable segments is consistent with that for third party transactions.


3,575 216 3,791 1,380

Ç°

3,084 204 3,288 1,052

Ç°

Ç°

3,915 390 4,305 1,622

2013

Ç°

3,565 550 4,115 1,625

2012

Ç°

1,563 684 2,247 (245)

2013

Ç°

2,101 1,001 3,102 (130)

2012

Broadcasting

Ç°

1,174 217 1,391 337

2013

Ç°

1,782 435 2,217 447

2012

Marketing events

Major customers For the year 2013 and 2012, the Group has no major customer with revenue of 10 percent or more of an entityâ&#x20AC;&#x2122;s revenues.

Revenue from external customers Inter-segment revenues Total revenues Segment operating income (loss) Interest income Other income Selling and servicing expenses Administrative expenses Ç° 4IBSFÇ°PGÇ°QSPĹłUÇ°GSPNÇ°JOWFTUNFOUTÇ°JOÇ°BTTPDJBUFTÇ° Finance cost Income tax expenses Losses for the year Property plant and equipment Intangible assets Other assets Total assets

2012

Media

Ç°

886 342 1,228 596

2013

Others

Ç°

412 128 540 203

2012

Ç°

(1,837) (1,837) (528)

Ç°

(2,330) (2,330) (152)

Elimination of Intersegment revenues 2013 2012

10,622 10,622 2,834 49 333 (1,007) (3,216) Ç° (139) (91) (1,221) 1,785 1,292 9,527 12,604

2013

Total

11,435 11,435 3,373 36 285 (875) (2,863)  (108) (184) (249) 1,631 1,320 8,514 11,465

2012

(Unit: Million Baht)

ANNUAL REPORT 2013

2013

Music

5IFÇ°GPMMPXJOHÇ°UBCMFTÇ°QSFTFOUÇ°SFWFOVF Ç°QSPĹłUÇ°BOEÇ°UPUBMÇ°BTTFUTÇ°JOGPSNBUJPOÇ°SFHBSEJOHÇ°UIFÇ°(SPVQÄ´TÇ°PQFSBUJOHÇ°TFHNFOUTÇ°GPSÇ°UIFÇ°ZFBSÇ°FOEFEÇ°Ç°%FDFNCFSÇ°Ç°BOEÇ° Ç°SFTQFDUJWFMZ

148 GMM GRAMMY


149

33. Provident fund

The Group and its employees have jointly established a provident fund in accordance with the Provident Fund Act B.E. 2530. Employees and the Group contribute to the fund monthly at the rate of 3 and 5 percent of basic salary. The fund, which is managed by SCB Asset Management Company Limited and Finansa Asset Management Limited, will be paid to employees upon termination in accordance with the fund rules. During the year 2013, the Group contributed Baht 45 million (2012: Baht 40 million) to the fund and Baht 18 million for the Company only (2012: Baht 16 million).

34. Commitments and contingent liabilities

Ç°

Ç°

Ç°*OWFTUJOHÇ°DPNNJUNFOUT As at 31 December 2013, the Group has uncalled portions of investments in two associates registered in Thailand, totaling Baht 18 million and in two associates registered in foreign, totaling US dollars 1 million and VND 4,910 million (2012: Baht 18 million), and of which Baht 530 million are from investments of the Company only in six subsidiaries registered in Thailand (2012: Baht 306 million). Ç°$BQJUBMÇ°DPNNJUNFOUT a) As at 31 December 2013, the Group had capital commitment in relation to the program rights with a company and foreign companies during year 2014 to 2018 of approximately Baht 32 million and US dollars 104 million, respectively. (2012: with a foreign company and a foreign federation of approximately US dollars 43,500 and Euro 2 million, respectively). b) As at 31 December 2013, the Group had capital commitment of approximately Baht 80 million, relating to the purchase of land, the construction of a studio and the installment of system in master control room (2012: Baht 104 million). c) As at 31 December 2013, the Group had capital commitment of approximately Baht 5,421 million, relating to the Ç° Ç° MJDFOTFÇ°GFFÇ°BTÇ°NFOUJPOFEÇ°JOÇ°/PUFÇ°Ç°UPÇ°UIFÇ°ĹłOBODJBMÇ°TUBUFNFOUT Ç°0QFSBUJOHÇ°MFBTFÇ°DPNNJUNFOUT a) The Group has entered into several lease agreements with third parties and two related parties in respect of the lease of air time for programme broadcasting and advertising placement at certain radio and television stations, the lease Ç° Ç° PGÇ°PGĹłDFÇ°CVJMEJOHÇ°BOEÇ°TIPQÇ°TQBDF Ç°UIFBUSFÇ°MFBTF Ç°FRVJQNFOUÇ°MFBTFTÇ°BOEÇ°UIFÇ°QSPWJTJPOÇ°PGÇ°SFMBUFEÇ°TFSWJDFTÇ°BOEÇ°NBSLFUÇ° research and survey services. Under certain agreements, payments are to be made based on a percentage of sales, before deducting expenses, as stipulated in the individual agreement, and the Group has to comply with various conditions laid out in the agreements. Future minimum lease payments required under these non-cancellable operating leases and related services contracts were as follows: (Unit: Million Baht)

Consolidated financial statements Separate financial statements 2013 2012 2013 2012 Payable within : 1 year 2 to 5 year Thereafter b)

Ç°

719 330 148

684 163 158

112 149 -

52 6 -

A subsidiary has entered into an agreement with a foreign company to lease broadcast equipment. Under this agreement, a subsidiary is obliged to pay a rental totaling US dollars 1 million ending in 2014 (2012: US dollars 1 million of the Company only). Ç°Ç°Ç°-POHUFSNÇ°TFSWJDFÇ°DPNNJUNFOUT a) The Company and its subsidiaries have entered into agreements with producers and singers to provide certain services Ç° Ç° UPÇ°UIFÇ°$PNQBOZÇ°BOEÇ°JUTÇ°TVCTJEJBSJFTÇ°VOEFSÇ°XIJDIÇ°UIFÇ°$PNQBOZÇ°BOEÇ°JUTÇ°TVCTJEJBSJFTÇ°BSFÇ°UPÇ°QBZÇ°DPNQFOTBUJPOÇ°BUÇ°ĹłYFEÇ° rates based on the volume of sales generated as a result of the provision of these services, once sales exceed minimum quantity guarantees set out in the agreements. b) A subsidiary has entered into an agreement with a company granting it the right to use a karaoke computer program for a period of 50 years. The subsidiary has to pay a fee to that company at a rate of three percent of the wholesale price, after deducting discounts, whenever the subsidiary is able to sell such program. The subsidiary and that company have to comply with various conditions stipulated in the agreement.


150

ANNUAL REPORT 2013

GMM GRAMMY

c)

Ç°

Ç°

Under the agreements with two foreign companies in relation to the use of its trademark and copyright in the production and distribution of a magazine, which the expiry dates are in 2012 and 2020, a subsidiary is obliged to pay royalty fee calculated at a certain percentage of its net turnover but not less than the minimum amount stipulated in the agreements and to pay the copyright fee on an annual basis at the amount as stipulated in the agreements. The subsidiary is thereby required to comply with conditions stipulated in the agreements. d) Under the agreements with two companies licensing to broadcast to the public, a subsidiary is committed to pay a royalty fee at a percentage of its revenues from sales of advertising, before deducting expenses for a period of Ç° Ç° Ç°ZFBS Ç°FOEJOHÇ°JOÇ°Ç°UIFÇ°ZFBSÇ° Ç°BTÇ°TQFDJĹłFEÇ°JOÇ°UIFÇ°BHSFFNFOUT e) The Company and its subsidiaries have entered into agreements with seven companies and two foreign companies, who are to provide satellite transmission services for periods of 1 to 10 years, ending in 2014 to 2023. The Company and its subsidiaries are obliged to pay transmission service fees and other expenses incurred in relation to such services, as stipulated in the agreements, totaling Baht 270 million and US dollars 132 million (2012: Baht 500 million and US dollars 17 million) and are thereby required to comply with conditions stipulated in the agreements. 34.5 Guarantees a) As at 31 December 2013, the Company has provided guarantees to bank for credit facilities granted to four subsidiaries amounting to Baht 2,120 million (2012: a subsidiary amounting to Baht 20 million). Generally, the Companyâ&#x20AC;&#x2122;s guarantee is binding for as long as the underlying obligations have not yet been discharged by such companies. b) As at 31 December 2013, there were outstanding bank guarantees of approximately Baht 190 million and US dollars 84 million issued by banks on behalf of the Group and Baht 7 million of the Company only in respect of certain performance bonds as required in the normal course of business (2012: Baht 248 million and Baht 8 million of the Company only). These included letters of guarantee amounting to Baht 184 million (2012: Baht 239 million) to guarantee contractual performance, Baht 6 million (2012: Baht 9 million) to guarantee electricity use, among others and US dollars 84 million (2012: none) to guarantee payments on program rights. c) As at 31 December 2013, a subsidiary had letter of credit issued by a commercial bank to guarantee the payment for goods amounting to Baht 33 million. Ç°-JUJHBUJPO a) A subsidiary was sued as jointly responsible for infringement of the copyright to musical works, with initial damages of Baht 50 million claimed together with Baht 100,000 per month for future damages as from the date of litigation (26 November 2010) until infringement of the copyright ceases. The plaintiff also requested interest at a rate of 7.5 percent per annum on the principal until settlement is complete. On 23 April 2012, the Central Intellectual Property and International Trade Court dismissed the case, and the plaintiff is currently appealing. b) The Company and a subsidiary were sued for amounts of USD 5 million and Baht 2 million in the grounds that they were jointly responsible for infringement of a licensing agreement. On 30 September 2013, the Central Intellectual Ç° Ç° 1SPQFSUZÇ°BOEÇ°*OUFSOBUJPOBMÇ°5SBEFÇ°$PVSUÇ°EJTNJTTFEÇ°UIFÇ°DBTFÇ°5IFÇ°DBTFÇ°XBTÇ°ĹłOBMMZÇ°KVEHFEÇ°BOEÇ°UIFSFÇ°JTÇ°OPÇ°BQQFBMÇ° from any party.

35. Financial instruments Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç°

Ç°'JOBODJBMÇ°SJTLÇ°NBOBHFNFOU Ç° 5IFÇ°(SPVQÄ´TÇ°ĹłOBODJBMÇ°JOTUSVNFOUT Ç°BTÇ°EFĹłOFEÇ°VOEFSÇ°5IBJÇ°"DDPVOUJOHÇ°4UBOEBSEÇ°/PÇ°Ç°Äś'JOBODJBMÇ°*OTUSVNFOUTÇ°%JTDMPTVSFÇ°BOEÇ° Presentationsâ&#x20AC;?, principally comprise cash and cash equivalents, trade and other receivables, loans, investments, trade and other Ç° QBZBCMFT Ç°TIPSUUFSNÇ°MPBOT Ç°MPOHUFSNÇ°MPBOTÇ°BOEÇ°MJBCJMJUJFTÇ°VOEFSÇ°ĹłOBODFÇ°MFBTFÇ°BHSFFNFOUTÇ°5IFÇ°ĹłOBODJBMÇ°SJTLTÇ°BTTPDJBUFEÇ°XJUIÇ° Ç° UIFTFÇ°ĹłOBODJBMÇ°JOTUSVNFOUTÇ°BOEÇ°IPXÇ°UIFZÇ°BSFÇ°NBOBHFEÇ°JOÇ°EFTDSJCFEÇ°CFMPX Credit risk The Groupâ&#x20AC;&#x2122;s exposed to credit risk primarily with respect to trade and other receivables. The Groupâ&#x20AC;&#x2122;s management manages Ç° UIFÇ°SJTLÇ°CZÇ°BEPQUJOHÇ°BQQSPQSJBUFÇ°DSFEJUÇ°DPOUSPMÇ°QPMJDJFTÇ°BOEÇ°QSPDFEVSFTÇ°BOEÇ°UIFSFGPSFÇ°EPFTÇ°OPUÇ°FYQFDUÇ°UPÇ°JODVSÇ°NBUFSJBMÇ°ĹłOBODJBMÇ° losses. In addition, the Group does not have high concentrations of credit risk since they have a large customer base. The maximum Ç° FYQPTVSFÇ°UPÇ°DSFEJUÇ°SJTLÇ°JTÇ°MJNJUFEÇ°UPÇ°UIFÇ°DBSSZJOHÇ°BNPVOUTÇ°PGÇ°SFDFJWBCMFTÇ°BTÇ°TUBUFEÇ°JOÇ°UIFÇ°TUBUFNFOUÇ°PGÇ°ĹłOBODJBMÇ°QPTJUJPO Interest rate risk The Groupâ&#x20AC;&#x2122;s exposure to interest rate risk relates primarily to its cash at banks, bank overdrafts, short-term and long-term borrowings. Ç° .PTUÇ°PGÇ°UIFÇ°(SPVQÄ´TÇ°ĹłOBODJBMÇ°BTTFUTÇ°BOEÇ°MJBCJMJUJFTÇ°CFBSÇ°Ĺ´PBUJOHÇ°JOUFSFTUÇ°SBUFTÇ°PSÇ°ĹłYFEÇ°JOUFSFTUÇ°SBUFTÇ°XIJDIÇ°BSFÇ°DMPTFÇ°UPÇ°UIFÇ°NBSLFUÇ°SBUFÇ° Ç° 4JHOJĹłDBOUÇ°ĹłOBODJBMÇ°BTTFUTÇ°BOEÇ°MJBCJMJUJFTÇ°DMBTTJĹłFEÇ°CZÇ°UZQFÇ°PGÇ°JOUFSFTUÇ°SBUFÇ°BSFÇ°TVNNBSJTFEÇ°JOÇ°UIFÇ°UBCMFÇ°CFMPX Ç°XJUIÇ°UIPTFÇ°ĹłOBODJBMÇ° Ç° BTTFUTÇ°BOEÇ°MJBCJMJUJFTÇ°UIBUÇ°DBSSZÇ°ĹłYFEÇ°JOUFSFTUÇ°SBUFTÇ°GVSUIFSÇ°DMBTTJĹłFEÇ°CBTFEÇ°POÇ°UIFÇ°NBUVSJUZÇ°EBUFÇ°PSÇ°UIFÇ°SFQSJDJOHÇ°EBUFÇ°JGÇ°UIJTÇ°PDDVSTÇ° before the maturity date.


151

(Unit: Million Baht)

Consolidated financial statements As at 31 December 2013 Fixed interest rates Floating Non - interest Within 1-5 Over interest bearing 1 year years 5 years rate Financial assets Cash and cash equivalent Current investments Trade and other receivables Loans to related parties Financial liabilities Bank overdraft and short-term loans Trade and other payables Long-term loans ǰ -JBCJMJUJFTǰVOEFSǰųOBODFǰMFBTFǰǰ agreements

Total

Interest rate (% p.a.)

1,128 1,985 3,113

-

-

525 81 5 611

2,422 2,422

1,653 2,066 2,422 5 6,146

Note 8 Note 9 Note 7

4,275 ǰ 19 4,294

ǰ 40 40

ǰ -

54 310 ǰ 364

2,522 ǰ 2,522

4,329 Note 20 2,522 310 Note 22 ǰ ǰ 59 3.43-8.15 7,220 (Unit: Million Baht)

Consolidated financial statements As at 31 December 2012 Fixed interest rates Floating Non - interest Within 1-5 Over interest bearing 1 year years 5 years rate Financial assets Cash and cash equivalent Current investments Trade and other receivables Loans to related parties Financial liabilities Bank overdraft and short-term loans Trade and other payables Long-term loans ǰ -JBCJMJUJFTǰVOEFSǰųOBODFǰǰ lease agreements

Total

643 523 1,166

-

-

202 33 6 241

2,782 2,782

845 556 2,782 6 4,189

2,901 ǰ 23 2,924

ǰ 45 45

-

208 454

2,547 -

3,109 2,547 454

ǰ

-

662

ǰ

2,547

ǰ

Interest rate (% p.a.) Note 8 Note 9 Note 7

Note 20 Note 22 ǰ ǰ 68 3.43-8.15 6,178


152

ANNUAL REPORT 2013

GMM GRAMMY

(Unit: Million Baht)

Separate financial statements As at 31 December 2013 Fixed interest rates Floating Non - interest Within 1-5 Over interest bearing 1 year years 5 years rate Financial assets Cash and cash equivalent Current investments Trade and other receivables Loans to related parties Financial liabilities Bank overdraft and short-term loans Trade and other payables Short-term loans from related parties ǰ -JBCJMJUJFTǰVOEFSǰųOBODFǰǰ lease agreements

Interest rate (% p.a.)

Total

343 1,875 2,218

-

-

520 1,595 2,115

1,733 1,733

863 1,875 1,733 1,595 6,066

Note 8 Note 9 Note 7

2,000 -

-

-

-

678

2,000 678

Note 20 -

ǰ 10 2,010

ǰ 24 24

-

1,363

-

1,363

ǰ

-

1,363

ǰ

678

ǰ

Note 7 ǰ ǰ 34 6.00-7.50 4,075

(Unit: Million Baht)

Separate financial statements As at 31 December 2012 Fixed interest rates Floating Non - interest Within 1-5 Over interest bearing 1 year years 5 years rate Financial assets Cash and cash equivalent Trade and other receivables Loans to related parties Financial liabilities Bank overdraft and short-term loans Trade and other payables ǰ -JBCJMJUJFTǰVOEFSǰųOBODFǰǰ lease agreements

Interest rate (% p.a.)

Total

-

-

-

140 14 154

1,825 1,825

140 1,825 14 1,979

326 ǰ 12 338

ǰ 24 24

-

-

726

326 726

-

ǰ

-

ǰ

726

ǰ

Note 8 Note 7

Note 20 ǰ ǰ 36 6.00-7.50 1,088


153

Ç° Ç° Ç° Ç° Ç°

Foreign currency risk The exposure of the Group to foreign currency risk relates primarily to its investments in foreign subsidiaries, which currently ǰ BSFǰOPUǰIFEHFEǰCZǰBOZǰEFSJWBUJWFǰųOBODJBMǰJOTUSVNFOUǰ)PXFWFS ǰUIFǰ(SPVQǰCFMJFWFTǰUIBUǰUIFSFǰXJMMǰCFǰOPǰNBUFSJBMǰJNQBDUǰ ǰ POǰUIFǰ(SPVQĴTǰųOBODJBMǰTUBUFNFOUTǰCFDBVTFǰUIFǰBNPVOUTǰPGǰJUTǰJOWFTUNFOUTǰJOǰGPSFJHOǰTVCTJEJBSJFTǰBSFǰJNNBUFSJBMJUZ ǰ'BJSǰWBMVFTǰPGǰųOBODJBMǰJOTUSVNFOUT ǰ 4JODFǰUIFǰNBKPSJUZǰPGǰUIFǰ(SPVQĴTǰųOBODJBMǰJOTUSVNFOUTǰBSFǰTIPSUUFSNǰJOǰOBUVSFǰPSǰCFBSǰŴPBUJOHǰJOUFSFTUǰSBUFT ǰUIFJSǰGBJSǰWBMVFǰJTǰ ǰ OPUǰFYQFDUFEǰUPǰCFǰNBUFSJBMMZǰEJGGFSFOUǰGSPNǰUIFǰBNPVOUTǰQSFTFOUFEǰJOǰUIFǰTUBUFNFOUTǰPGǰųOBODJBMǰQPTJUJPOǰ A fair value is the amount for which an asset can be exchanged or a liability settled between knowledgeable, willing parties ǰ JOǰBOǰBSNĴTǰMFOHUIǰUSBOTBDUJPOǰ5IFǰGBJSǰWBMVFǰJTǰEFUFSNJOFEǰCZǰSFGFSFODFǰUPǰUIFǰNBSLFUǰQSJDFǰPGǰUIFǰųOBODJBMǰJOTUSVNFOUTǰPSǰ by using an appropriate valuation technique, depending on the nature of the instrument.

36. Capital management The primary objective of the Groupâ&#x20AC;&#x2122;s capital management is to ensure that it has appropriate capital structure in order to support its business and maximise shareholder value. As at 31 December 2013, the Groupâ&#x20AC;&#x2122;s debt-to-equity ratio was 2.17:1 (2012: 1.92:1) and the Companyâ&#x20AC;&#x2122;s was 1.04:1 (2012: 0.55:1).

37. Approval of financial statements Ç°

5IFTFǰųOBODJBMǰTUBUFNFOUTǰXFSFǰBVUIPSJTFEǰGPSǰJTTVFǰCZǰUIFǰ$PNQBOZĴTǰ#PBSEǰPGǰ%JSFDUPSTǰPOǰǰ'FCSVBSZǰ


154

ANNUAL REPORT 2013

GMM GRAMMY

Sub-Committee Report Audit Committee Report GMM Grammy Public Company Limited and Its Subsidiaries The Audit Committee (â&#x20AC;&#x153;the Committeeâ&#x20AC;?) has been appointed by a resolution passed by the Board of Directors which comprises 4 independent Directors. Dr. Naris Chaiyasoot was appointed Chairman of the Audit Committee and the other members are Mr. Dej Bulsuk, Mr. Weerawong Chittmittrapap and Ms. Suvabha Charoenying. The Director of the Internal Audit Department serves as the secretary to the Committee. In 2013, the Committee had performed according to the Audit Committee Charter which complies with the relevant rules and regulations set forth by the Stock Exchange of Thailand and the Good Corporate Governance policy. The Committee conducted 4 meetings, the summary of attendance of the Audit Committee members is as follows :

Name

Position

Regular Meeting

Mr. Chai Nasylvanta

Chairman

1/1

1. Dr. Naris Chaiyasoot

Chairman

3/3

2. Mr. Dej Bulsuk

Member

4/4

3. Mr. Weerawong Chittmittrapap

Member

4/4

4. Ms. Suvabha Charoenying

Member

4/4

The Committee activities could be summarized as follows: Ç° 3FWJFXFEÇ°UIFÇ°RVBSUFSMZÇ°BOEÇ°UIFÇ°BOOVBMÇ°ĹłOBODJBMÇ°TUBUFNFOUTÇ°GPSÇ°UIFÇ°ZFBSÇ°Ç°SFHBSEJOHÇ°UIFÇ°EJTDMPTVSFÇ°PGÇ°TJHOJĹłDBOUÇ°JOGPSNBUJPO Ç° rendered by the Internal Audit Department, the External Auditors and the Management, to ensure the accuracy, reliability and adequacy. Ç° 3FWJFXFEÇ°UIFÇ°FGĹłDJFODZÇ°BOEÇ°UIFÇ°BEFRVBDZÇ°PGÇ°UIFÇ°(..Ç°(SBNNZÇ°(SPVQÄ´TÇ°JOUFSOBMÇ°DPOUSPMÇ°TZTUFNÇ°JOÇ°DPPQFSBUJPOÇ°XJUIÇ°UIFÇ°*OUFSOBMÇ° Audit Department, the External Auditors and the Management. 3. Reviewed that the Company abided by the SEC and SET rules and regulations, other related laws, the Companyâ&#x20AC;&#x2122;s good corporate governance and Code of Ethics Policies, through coordination with Management and Internal Audit Department. 4. Considered and recommended the appointment of external auditors and their audit fee. For the year 2014, the Committee, in coordination with the Internal Audit Department and the Management, considered the independence and the qualities of the audit task and recommended the reappointment of Miss Siraporn Ouaanunkun or Mr. Termphong Opanaphan or Mr. Khitsada Ç° -FSEXBOB Ç°$FSUJĹłFEÇ°1VCMJDÇ°"DDPVOUBOUÇ° 5IBJMBOE Ç°/PÇ° Ç°Ç°BOEÇ°Ç°SFTQFDUJWFMZ Ç°PGÇ°&:Ç°0GĹłDFÇ°-JNJUFEÇ° GPSNFSMZÇ°LOPXOÇ°BTÇ° Ç° Äś&SOTUÇ°Ç°:PVOHÇ°0GĹłDFÇ°-JNJUFEġ Ç°BTÇ°UIFÇ°$PNQBOZÄ´TÇ°BOEÇ°JUTÄ´Ç°TVCTJEJBSJFTÄ´Ç°&YUFSOBMÇ°"VEJUPSTÇ°BOEÇ°UIFÇ°BVEJUÇ°GFFÇ°GPSÇ°UIFÇ°ĹłTDBMÇ°ZFBSÇ°Ç° The appointment of the External Auditor for the year 2014 was approved by the Board of Directors and will be proposed to the Shareholders for their further approval. For the year 2013, the Committee conducted 1 meeting with External Auditor. Ç° 3FWJFXFEÇ°SFMBUFEÇ°USBOTBDUJPOTÇ°PSÇ°DPOĹ´JDUÇ°PGÇ°JOUFSFTUÇ°JTTVFTÇ°UPÇ°FOTVSFÇ°UIBUÇ°USBOTBDUJPOTÇ°XFSFÇ°SFBTPOBCMFÇ°BOEÇ°GBJSÇ°JOÇ°BDDPSEBODFÇ° with the rules or announcements of the SET and the disclosures were correct and complete.


155

6. Reviewed and acknowledged internal audit results quarterly, followed up management actions and progresses on the internal ǰ BOEǰFYUFSOBMǰBVEJUǰųOEJOHTǰBOEǰSFDPNNFOEBUJPOT ǰBQQSPWFEǰUIFǰJOUFSOBMǰBVEJUǰQMBOǰGPSǰUIFǰZFBSǰǰ*OǰBEEJUJPO ǰUIFǰ$PNNJUUFFǰ ǰ SFWJFXFEǰUIFǰJOEFQFOEFODFǰPGǰUIFǰ*OUFSOBMǰ"VEJUǰBOEǰDPODVSSFEǰUPǰUIFǰQFSGPSNBODFǰFWBMVBUJPOǰPGǰUIFǰ*OUFSOBMǰ"VEJUǰTUBGGTǰBOEǰ ǰ UIFJSǰSFNVOFSBUJPOTǰXIJDIǰXFSFǰBTTFTTFEǰBOEǰQSPQPTFEǰCZǰ(SPVQǰ$IJFGǰ&YFDVUJWFǰ0GųDFS ǰ "OOVBMMZǰSFWJFXFEǰBOEǰVQEBUFEǰUIFǰ$IBSUFSǰPGǰ"VEJUǰ$PNNJUUFFǰBOEǰ*OUFSOBMǰ"VEJU ǰUPǰFOTVSFǰUIBUǰUIFǰ$IBSUFSTǰTUJMMǰTVJUǰXJUIǰUIFǰ ǰ $PNQBOZĴTǰCVTJOFTTǰFOWJSPONFOUǰ ǰ $POEVDUFEǰUIFǰ"VEJUǰ$PNNJUUFFǰTFMGǰBTTFTTNFOUǰPOǰJUTǰDPNQPTJUJPO ǰRVBMJųDBUJPO ǰBDUJWJUJFTǰJOǰDPNQMJBODFǰUPǰUIFǰBVEJUǰ$PNNJUUFFǰ ǰ $IBSUFS ǰUSBJOJOH ǰBVUIPSJUZǰBOEǰUIFǰJOEFQFOEFODFǰ'PSǰUIFǰZFBSǰ ǰUIFǰ$PNNJUUFFǰDPODMVEFEǰUIBUǰUIFǰ$PNNJUUFFǰIBTǰBEFRVBUFMZǰ ǰ DPNQMFUFEǰJUTǰEVUZǰBTǰBTTJHOFEǰBOEǰSFQPSUFEǰUIFǰBTTFTTNFOUǰSFTVMUTǰBMPOHǰXJUIǰUIFǰ$PNNJUUFFĴTǰBDUJWJUJFTǰUPǰUIFǰ#PBSEǰPGǰ%JSFDUPSTǰ ǰ .FFUJOHTǰPOǰ'FCSVBSZǰ ǰ ǰ 3FWJFXFEǰUIBUǰUIFǰ$PNQBOZǰBCJEFEǰCZǰUIFǰ(PPEǰ$PSQPSBUFǰ(PWFSOBODFǰBOEǰ$PEFǰPGǰ&UIJDTǰ1PMJDJFT ǰSFWJFXFEǰBOEǰVQEBUFEǰUIFǰ ǰ QPMJDZǰXJUIǰUIFǰ.BOBHFNFOUǰBOEǰJOUFSOBMǰBVEJUPSǰUPǰTVJUǰXJUIǰUIFǰ$PNQBOZĴTǰCVTJOFTTǰFOWJSPONFOUǰCFGPSFǰSFOEFSJOHǰJUǰUPǰUIFǰ ǰ #PBSEǰPGǰ%JSFDUPSTǰGPSǰBQQSPWBM "TǰUIFǰSFTVMUǰPGǰUIFǰBCPWFǰPCMJHBUJPOT ǰUIFǰ$PNNJUUFFǰBHSFFEǰUIBUǰJOǰHFOFSBM ǰUIFǰJOUFSOBMǰDPOUSPMǰTZTUFNǰPGǰUIFǰDPNQBOZǰXBTǰBEFRVBUFǰ and appropriate for the connected transactions associated with the major shareholders, directors, management or other related persons. *OǰBEEJUJPO ǰUIFSFǰXBTǰBEFRVBUFǰBOEǰBQQSPQSJBUFǰDPOUSPMǰTZTUFNǰUPǰUIFǰCVTJOFTTǰPQFSBUJPOTǰPGǰUIFǰ$PNQBOZǰ5IFǰ$PNNJUUFFǰBOEǰUIFǰ management recognized the importance of good corporate governance, internal control, and continuous risk management, which would ensure good corporate governance principles of company, acceptable level of internal control and risk management, accurate BOEǰSFMJBCMFǰBDDPVOUJOHǰBOEǰųOBODJBMǰSFQPSUJOHǰQSBDUJDFT ǰUPHFUIFSǰXJUIǰDPNQMJBODFǰXJUIǰUIFǰMBXT ǰUIFǰSVMFTǰPSǰBOOPVODFNFOUTǰPGǰUIFǰ 4&5ǰBOEǰSFHVMBUJPOTǰSFMBUFEǰUPǰUIFǰ$PNQBOZĴTǰCVTJOFTTFT

(Dr. Naris Chaiyasoot) Chairman of the Audit Committee February 28, 2014


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ANNUAL REPORT 2013

GMM GRAMMY

Risk Management Committee GMM Grammy Public Company Limited. 5IFǰ3JTLǰ.BOBHFNFOUǰ$PNNJUUFFǰXBTǰFTUBCMJTIFEǰCZǰUIFǰ#PBSEǰPGǰ%JSFDUPSTǰSFTPMVUJPOǰXJUIǰEVUJFTǰUPǰQSPNPUFǰUIFǰTFUVQǰPGǰBOǰ FOUFSQSJTFXJEFǰSJTLǰNBOBHFNFOUǰTZTUFNǰBOEǰUPǰFNCFEǰBǰ(..ǰ(3"..:ǰ(SPVQǰ ĶUIFǰ(SPVQķ ǰDVMUVSFǰ5IJTǰJTǰUPǰQSPWJEFǰSFBTPOBCMFǰ BTTVSBODFǰBNPOHǰBMMǰTUBLFIPMEFSTǰUIBUǰUIFǰ(SPVQĴTǰTUSBUFHJDǰPQFSBUJPOTǰBSFǰHFBSFEǰUPXBSETǰFGGFDUJWFǰBOEǰFGųDJFOUǰBDIJFWFNFOUǰPGǰ DPSQPSBUFǰHPBMTǰBOEǰPCKFDUJWFTǰ"TǰPGǰ%FDFNCFSǰ ǰ ǰUIFǰ$PNNJUUFFǰXBTǰDPNQSJTFEǰPGǰǰNFNCFSTǰXIPǰBSFǰUIFǰ#PBSEǰPGǰ%JSFDUPSTǰ BOEǰUPQǰFYFDVUJWFTǰXJUIǰSFMFWBOUǰLOPXMFEHF ǰDPNQFUFODFǰBOEǰFYQFSJFODFǰUIBUǰCFOFųDJBMǰUPǰUIFǰHSPVQǰSJTLǰNBOBHFNFOUǰ5IFǰ%JSFDUPSǰ PGǰUIFǰ$PSQPSBUFǰ3JTLǰ.BOBHFNFOUǰBOEǰ*OUFSOBMǰ$POUSPMǰ%FQBSUNFOUǰTFSWFTǰBTǰUIFǰTFDSFUBSZǰUPǰUIFǰ$PNNJUUFF 5IFǰ$PNNJUUFFǰQFSGPSNTǰEVUJFTǰBTǰEFTJHOBUFEǰCZǰUIFǰ#PBSEǰPGǰ%JSFDUPST ǰXJUIJOǰUIFǰQVSWJFXǰPGǰQPXFSǰBOEǰSFQPOTJCJMJUZǰBTǰEFųOFEǰJOǰ UIFǰ3JTLǰ.BOBHFNFOUǰ$PNNJUUFFǰ$IBSUFSǰ%VSJOHǰUIFǰZFBSǰ ǰUIFǰ$PNNJUUFFǰIFMEǰUISFFǰNFFUJOHTǰXJUIǰUIFǰGPMMPXJOHǰSFTVMUT ǰ "DLOPXMFEHFEǰUIFǰTJHOJųDBOUǰSJTLTǰPGǰUIFǰDPSQPSBUFǰBOEǰFBDIǰCVTJOFTTFTǰHSPVQ ǰBMTPǰBQQSPWFEǰUIFǰSFMBUFEǰSJTLǰSFTQPOTFTǰGPSǰUIFǰ ǰ ZFBSǰ ǰ $BSFGVMMZǰTVQFSWJTFEǰUIFǰQSPHSFTTǰBOEǰQFSGPSNBODFǰPGǰUIFǰSJTLǰNBOBHFNFOUǰTZTUFNTǰUPǰTFFǰXIFUIFSǰUIFZǰBSFǰTVGųDJFOUǰBOEǰ ǰ BQQSPQSJBUFǰGPSǰUIFǰOBUVSFǰPGǰUIFǰ$PNQBOZĴTǰCVTJOFTTFT ǰ 3FWJFXFEǰUIFǰ(SPVQǰ3JTLǰ.BOBHFNFOUǰ1PMJDZǰBOEǰ'SBNFXPSL ǰ 3FQPSUFEǰSFHVMBSMZǰUPǰUIFǰ#PBSEǰPGǰ%JSFDUPSTǰPOǰUIFǰTJHOJųDBOUǰSJTLTǰBOEǰUIFJSǰSFTQPOTFT ǰ 1FSGPSNFEǰ3JTLǰ.BOBHFNFOUǰ$PNNJUUFFǰ4FMGǰ"TTFTTNFOUǰGPSǰUIFǰZFBSǰ ǰ 1SPQPTFEǰUIFǰOFDFTTBSZǰBQQPJOUNFOUǰPOǰUIFǰ$PNNJUUFFǰBOEǰSFMBUFEǰQFSTPOǰGPSǰUIFǰBDIJFWFNFOUǰPGǰDPSQPSBUFǰPCKFDUJWFT "DDPSEJOHǰUPǰUIFǰJTTVFTǰBOEǰUBTLTǰNFOUJPOFEǰBCPWF ǰUIFǰ3JTLǰ.BOBHFNFOUǰ$PNNJUUFFǰIBTǰDPOTJEFSFEǰUIBUǰUIFǰDPSQPSBUFǰSJTLǰGBDUPSTǰ IBWFǰCFFOǰTFUVQ ǰDPWFSJOHǰUIFǰDPSFǰCVTJOFTTFTǰBOEǰUIFǰSJTLǰNBOBHFNFOUǰNFUIPE ǰIBWFǰBMTPǰCFFOǰJEFOUJųFEǰBEFRVBUFMZ ǰBQQSPQSJBUFMZǰ BOEǰFGųDJFOUMZǰ*OǰBEEJUJPO ǰUIFTFǰDPNQMJFEǰXJUIǰUIFǰHSPVQǰHPPEǰDPSQPSBUFǰHPWFSOBODFǰQSJODJQMFT ǰUIFǰJOUFSOBMǰDPOUSPM ǰSJTLǰNBOBHFNFOUǰ roadmap, development of risk management, as well as related laws, rules and regulations.

(Ms. Boosaba Daorueng) Chairman of Risk Management Committee February 28, 2014


157

Report of the Nomination and Remuneration Committee 5IFǰ /PNJOBUJPOǰ BOEǰ 3FNVOFSBUJPOǰ $PNNJUUFF ǰ (..ǰ (SBNNZǰ 1VCMJDǰ$PNQBOZǰ-JNJUFEǰ UIFǰ$PNNJUUFF ǰBTǰPGǰ%FDFNCFSǰ ǰ ǰ DPNQSJTFEǰ ǰ EJSFDUPSTǰ ǰ CFJOHǰ JOEFQFOEFOUǰ EJSFDUPST ǰ XJUIǰ .Sǰ %FKǰ #VMTVLǰ CFJOHǰ $IBJSNBOǰ PGǰ UIFǰ /PNJOBUJPOǰ BOEǰ 3FNVOFSBUJPOǰ $PNNJUUFF ǰ%Sǰ/BSJTǰǰ$IBJZBTPPUǰBOEǰ.Sǰ1BJCPPOǰ%BNSPOHDIBJUIBN ǰ NFNCFSTǰPGǰUIFǰ/PNJOBUJPOǰBOEǰ3FNVOFSBUJPOǰ$PNNJUUFF %VSJOHǰUIFǰZFBSǰ ǰUIFǰ$PNNJUUFFǰJOǰQFSGPSNJOHǰSPMFTǰJOǰBDDPSEBODFǰ XJUIǰJUTǰDIBSUFSǰBOEǰUIFǰTDPQFǰPGǰBVUIPSJUZǰIFMEǰǰNFFUJOHTǰ XJUIǰGVMMǰ BUUFOEBODFǰJOǰFBDIǰPGǰUIFǰNFFUJOHT ǰUPǰDPOTJEFSǰJNQPSUBOUǰNBUUFSTǰ VOEFSǰ JUTǰ EVUJFTǰ BOEǰ SFTQPOTJCJMJUJFTǰ BTǰ BTTJHOFEǰ CZǰ UIFǰ #PBSEǰ PGǰ %JSFDUPST ǰXIJDIǰDBOǰCFǰTVNNBSJ[FEǰBTǰGPMMPXT  ǰ /PNJOBUJPOǰPGǰQFSTPOTǰXJUIǰRVBMJųDBUJPOTǰGPSǰUIFǰ$PNQBOZĴTǰ ǰ EJSFDUPSTIJQǰUPǰSFQMBDFǰǰEJSFDUPSTǰXIPǰXPVMEǰSFUJSFǰCZǰSPUBUJPO ǰ ǰ OBNFMZ ǰ.Sǰ$IBJǰ/BTZMWBOUB ǰ.Sǰ%FKǰ#VMTVL ǰ.Sǰ8FFSBXPOHǰ ǰ $IJUUNJUUSBQBQǰBOEǰ.Tǰ#PPTBCBǰ%BPSVFOHǰ ǰ 5Pǰ FOIBODFǰ BOEǰ TVQQPSUǰ UIFǰ $PNQBOZĴTǰ HPPEǰ DPSQPSBUFǰ ǰ HPWFSOBODFǰQPMJDZ ǰUIFǰ$PNQBOZǰXFMDPNFEǰNJOPSǰTIBSFIPMEFSTĴǰ ǰ QSPQPTBMǰ GPSǰ RVBMJųFEǰ DBOEJEBUFTǰ UPǰ CFǰ BQQPJOUFEǰ BTǰ UIFǰ ǰ $PNQBOZĴTǰEJSFDUPSTǰUISPVHIǰUIFǰ$PNQBOZǰ4FDSFUBSZ ǰ*OWFTUPSǰ ǰ 3FMBUJPOTǰ6OJU ǰPSǰUIFǰ$PNQBOZĴTǰXFCTJUFǰGSPNǰ4FQUFNCFSǰ ǰ ǰ ǰUPǰ+BOVBSZǰ ǰǰ%VSJOHǰUIFǰQFSJPE ǰOPǰTIBSFIPMEFSǰ ǰ OPNJOBUFEǰ BOZǰ DBOEJEBUFǰ GPSǰ DPOTJEFSBUJPOǰ $POTJEFSJOHǰ UIFǰ ǰ BQQSPQSJBUFOFTTǰBOEǰNBYJNVNǰCFOFųUTǰUPǰUIFǰ$PNQBOZ ǰUIFǰ ǰ $PNNJUUFFǰXBTǰPGǰUIFǰPQJOJPOǰUIBUǰUIFǰSFUJSJOHǰEJSFDUPSTǰIBEǰ ǰ GVMMǰRVBMJųDBUJPOTǰBTǰTUJQVMBUFEǰCZǰUIFǰ1VCMJDǰ-JNJUFEǰ$PNQBOJFTǰ ǰ "DUǰ #&ǰ ǰ BOEǰ XFSFǰ XFMMǰ FRVJQQFEǰ XJUIǰ LOPXMFEHF ǰ ǰ DBQBCJMJUJFTǰBOEǰFYQFSJFODFTǰVTFGVMǰGPSǰUIFǰ$PNQBOZĴTǰCVTJOFTTǰ operations; they also had broad visions, satisfactory performance as directors, good records of meeting attendance and useful ǰ PQJOJPOTǰQSPQPTFEǰBUǰUIFǰ#PBSEĴTǰNFFUJOHTǰ5IFǰ$PNNJUUFFǰ ǰ UIFSFGPSFǰSFTPMWFEǰUPǰQSPQPTFǰUPǰUIFǰ#PBSEǰPGǰ%JSFDUPSTĴǰ.FFUJOHǰ ǰ /Pǰ ǰ POǰ 'FCSVBSZǰ  ǰ ǰ UIFǰ OPNJOBUJPOǰ PGǰ UIFǰ ǰ ǰ SFUJSJOHǰEJSFDUPSTǰGPSǰBQQPJOUNFOUǰBTǰUIFǰ$PNQBOZĴTǰEJSFDUPSTǰGPSǰ ǰ BOPUIFSǰUFSNǰCFGPSFǰTVCNJUUJOHǰUPǰUIFǰǰ"OOVBMǰ(FOFSBMǰ ǰ .FFUJOHǰPGǰ4IBSFIPMEFSTǰIFMEǰPOǰǰ"QSJMǰ ǰǰGPSǰBQQSPWBMǰ  ǰ /PNJOBUJPOǰPGǰBǰQFSTPOǰXJUIǰRVBMJųDBUJPOTǰGPSǰUIFǰ$PNQBOZĴTǰ directorship to replace the director who resigned by considering ǰ BOEǰQSPQPTJOHǰUPǰUIFǰ#PBSEǰPGǰ%JSFDUPSTĴǰ.FFUJOHǰ/PǰǰPOǰ ǰ .BSDIǰ  ǰ ǰ UPǰ BQQPJOUǰ PGǰ %Sǰ /BSJTǰ $IBJZBTPPUǰ BTǰ UIFǰ ǰ $PNQBOZĴTǰ JOEFQFOEFOUǰ EJSFDUPS ǰ $IBJSNBOǰ PGǰ UIFǰ "VEJUǰ ǰ $PNNJUUFFǰBOEǰNFNCFSǰPGǰUIFǰ/PNJOBUJPOǰBOEǰ3FNVOFSBUJPOǰ ǰ $PNNJUUFF ǰSFQMBDJOHǰ.Sǰ$IBJǰ/BTZMWBOUB ǰXIPǰIBEǰSFTJHOFE  ǰ %FUFSNJOBUJPOǰPGǰEJSFDUPSǰSFNVOFSBUJPOǰUIBUǰXBTǰHSBUVJUJFTǰGPSǰ ǰ UIFǰZFBSǰǰUPHFUIFSǰXJUIǰBMMPDBUJPOǰDSJUFSJBǰGPSǰTVCNJTTJPOǰUPǰ ǰ UIFǰ#PBSEǰPGǰ%JSFDUPSTǰUPǰQSPQPTFǰBUǰUIFǰǰ"OOVBMǰ(FOFSBMǰ ǰ .FFUJOHǰPGǰ4IBSFIPMEFSTǰIFMEǰPOǰ"QSJMǰ ǰǰGPSǰBQQSPSBM  ǰ %FUFSNJOBUJPOǰPGǰUIFǰ"VEJUǰ$PNNJUUFFĴTǰSFNVOFSBUJPOǰBTǰBOOVBMǰ ǰ DPNQFOTBUJPOǰGPSǰUIFǰZFBSǰǰUPHFUIFSǰXJUIǰBMMPDBUJPOǰDSJUFSJBǰ ǰ GPSǰTVCNJTTJPOǰUPǰUIFǰ#PBSEǰPGǰ%JSFDUPSTǰGPSǰBQQSPWBMǰBOEǰTVCNJTTJPOǰ ǰ UPǰUIFǰǰ"OOVBMǰ(FOFSBMǰ.FFUJOHǰPGǰ4IBSFIPMEFSTǰIFMEǰPOǰ ǰ "QSJMǰ ǰǰGPSǰBDLOPXMFEHNFOU ǰ 5IFǰ SFNVOFSBUJPOǰ PGǰ EJSFDUPSTǰ BOEǰ UIFǰ "VEJUǰ $PNNJUUFFĴTǰ members was determined, with their respective duties and ǰ SFTQPOTJCJMJUJFTǰ GPSǰ UIFǰ $PNQBOZĴTǰ QFSGPSNBODFTǰ CFJOHǰ considered and the remuneration of directors of companies in

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UIFǰTBNFǰJOEVTUSZǰCFJOHǰDPNQBSFE ǰCBTFEǰPOǰUIFǰ5IBJǰ*OTUJUVUFǰ PGǰ%JSFDUPSTǰ *0% ĴTǰ3FQPSUǰPGǰUIFǰ4VSWFZǰPOǰ3FNVOFSBUJPOǰPGǰ %JSFDUPSTǰBOEǰ.BOBHFNFOUǰPGǰ-JTUFEǰ$PNQBOJFT ǰGPSǰTVJUBCJMJUZǰ and transparency. "TTFTTNFOUǰPGǰUIFǰQFSGPSNBODFTǰPGǰUIFǰ(SPVQǰ$IJFGǰ&YFDVUJWFǰ 0GųDFSǰ (SPVQǰ$&0 ǰ.Tǰ#PPTBCBǰ%BPSVFOH ǰGPSǰUIFǰZFBSǰǰ 5IFǰǰNFNCFSTǰPGǰUIFǰ$PNNJUUFFǰEFFNFEǰJUǰBQQSPQSJBUFǰUPǰ SBUFǰUIFǰ(SPVQǰ$&0ĴTǰQFSGPSNBODFTǰJOǰǰBTǰĶ&YDFMMFOUķǰPSǰ ǰ XJUIJOǰ UIFǰ SBOHFǰ PGǰ ǰ ǰ  ǰ BOEǰ SFQPSUFEǰ UIFǰ BTTFTTNFOUǰSFTVMUǰUPǰUIFǰ#PBSEǰPGǰ%JSFDUPSTĴǰ.FFUJOHǰ/Pǰǰ for approval. %FUFSNJOBUJPOǰPGǰBǰTFMGǰǰBTTFTTNFOUǰGPSNǰGPSǰUIFǰ/PNJOBUJPOǰBOEǰ 3FNVOFSBUJPOǰ $PNNJUUFF ǰ $PSQPSBUFǰ (PWFSOBODFǰ BOEǰ &UIJDTǰ $PNNJUUFFǰBOEǰ"VEJUǰ$PNNJUUFFǰUPǰVTFǰGPSǰTFMGǰBTTFTTNFOUǰJOǰ %FUFSNJOBUJPOǰPGǰBǰTFMGǰǰBTTFTTNFOUǰGPSNǰGPSǰUIFǰ$PNQBOZĴTǰ EJSFDUPSǰ JOEJWJEVBM ǰUPǰǰVTFǰGPSǰEJSFDUPSTĴǰTFMGǰǰBTTFTTNFOUǰJOǰ ǰCFGPSFǰTVCNJTTJPOǰUPǰUIFǰ#PBSEǰPGǰ%JSFDUPSTǰGPSǰBQQSPWBM *UFNTǰ  ǰBOEǰ  ǰXFSFǰVOEFSUBLFOǰJOǰBDDPSEBODFǰXJUIǰUIFǰ#PBSEǰ PGǰ%JSFDUPSTĴǰSFTPMVUJPOǰUPǰIBWFǰUIFǰ$PNQBOZĴTǰDPNNJUUFFTǰBOEǰ each director assess their performance based on the new criteria VOEFSǰUIFǰ5IBJǰ*OTUJUVUFǰPGǰ%JSFDUPSTǰ *0% ĴTǰ4VSWFZǰPGǰ5IBJǰ-JTUFEǰ $PNQBOJFTĴǰ$PSQPSBUFǰ(PWFSOBODFǰǰ 3FWJFXǰ BOEǰ BQQSPWBMǰ PGǰ UIFǰ DSJUFSJBQPMJDZQSPDFTTǰ JOǰ UIFǰ OPNJOBUJPOǰBOEǰBQQPJOUNFOUǰPGǰUIFǰ$PNQBOZĴTǰEJSFDUPSTǰGPSǰ DMBSJUZǰBOEǰDPNQMJBODFǰXJUIǰ*0%ĴTǰDSJUFSJBǰPOǰUIFǰOPNJOBUJPOǰBOEǰ BQQPJOUNFOUǰ PGǰ EJSFDUPSTǰ BTǰ QFSǰ EFUBJMTǰ JOǰ JUFNǰ Ķ$PSQPSBUFǰ (PWFSOBODFķǰ HJWFOǰ JOǰ UIFǰ ǰ *OGPSNBUJPOǰ %JTDMPTVSFǰ 'PSNǰ 'PSNǰ ǰPGǰUIFǰ$PNQBOZ

%FUFSNJOBUJPOǰ PGǰ UIFǰ #PBSEǰ 4LJMMǰ .BUSJYǰ GPSǰ VTFǰ BTǰ Bǰ UPPMǰ JOǰ EFUFSNJOJOHǰEJSFDUPSĴTǰRVBMJųDBUJPOTǰBOEǰHVJEFMJOFTǰJOǰDPOTJEFSJOHǰ UIFǰRVBMJųDBUJPOTǰPSǰTLJMMTǰUIFǰ#PBSEǰSFRVJSFTǰPSǰMBDLT ǰTPǰBTǰUPǰ JODSFBTFǰUIFǰFGųDJFODZǰPGǰUIFǰ$PNQBOZĴTǰEJSFDUPSǰOPNJOBUJPOǰ QSPDFTT ǰJOǰBDDPSEBODFǰXJUIǰ*0%ĴTǰHVJEFMJOFTǰPOǰHPPEǰDPSQPSBUFǰ governance. 5IFǰ$PNNJUUFFǰIBTǰDPOEVDUFEǰTFMGQFSGPSNBODFǰBTTFTTNFOUǰ GPSǰUIFǰZFBSǰǰXIJDIǰDPNQSJTFTǰPGǰǰDBUFHPSJFTǰ4USVDUVSFǰ BOEǰ$PNQPTJUJPOǰPGǰUIFǰ$PNNJUUFF ǰ3PMFTǰBOEǰ3FTQPOTJCJMJUJFT ǰ .FFUJOH ǰ %VUJFTǰ 1FSGPSNBODFǰ PGǰ UIFǰ $PNNJUUFFĴTǰ .FNCFST ǰ BOEǰ 4FMGǰ %FWFMPQNFOUǰ PGǰ UIFǰ $PNNJUUFFĴTǰ .FNCFSTǰ 5IFǰ BTTFTTNFOUǰDSJUFSJBǰEJWJEFEǰJOUPǰǰMFWFMTǰǰǰFYDFMMFOU ǰǰǰHPPE ǰ ǰǰGBJS ǰǰǰVOTBUJTGBDUPSZ ǰǰǰOFFEǰJNQSPWFNFOUǰ5IFǰPWFSBMMǰ BWFSBHFǰSFTVMUǰPGǰUIFǰTFMGBTTFTTNFOUǰPGǰUIFǰ$PNNJUUFFǰXBTǰ FRVBMǰUPǰ 5IFǰ$PNNJUUFFǰSFQPSUFEǰJUTǰQFSGPSNBODFǰUPǰUIFǰ#PBSEǰPGǰ%JSFDUPSTǰ GPSǰBDLOPXMFEHFNFOUǰPOǰBǰSFHVMBSǰCBTJTǰ5ISPVHIPVUǰUIFǰZFBSǰ ǰ UIFǰ$PNNJUUFFǰQFSGPSNFEǰJUTǰEVUJFTǰXJUIǰVUNPTUǰBCJMJUZ ǰDBVUJPO ǰ QSVEFODF ǰUSBOTQBSFODZǰBOEǰJOEFQFOEFODF ǰGPSǰUIFǰCFTUǰCFOFųUǰ PGǰUIFǰ$PNQBOZ ǰTIBSFIPMEFSTǰBOEǰPUIFSǰTUBLFIPMEFST

(Mr. Dej Bulsuk) Chairman of the Nomination and Remuneration Committee February 28, 2014


158

ANNUAL REPORT 2013

GMM GRAMMY

GMM Grammy Public Company Limited 5IFǰ#PBSEǰPGǰ%JSFDUPSTǰTUSPOHMZǰCFMJFWFTǰJOǰDPOEVDUJOHǰCVTJOFTTǰBDDPSEJOHǰUPǰCVTJOFTTǰFUIJDTǰBOEǰHPPEǰDPSQPSBUFǰHPWFSOBODFǰQSJODJQMFTǰ BOEǰBMPOHTJEFǰDPSQPSBUFǰTPDJBMǰSFTQPOTJCJMJUZǰ $43 ǰUPǰCFǰFNCFEEFEǰBTǰQBSUǰPGǰUIFǰPSHBOJ[BUJPOǰDVMUVSFǰǰ5IJTǰJTǰDBSSJFEǰCZǰJOUFHSBUJOHǰ XJUIǰUIFǰ$PNQBOZĴTǰWJTJPO ǰNJTTJPO ǰTUSBUFHZ ǰBOEǰHPBMǰUPǰTVQQPSUǰFGųDJFOUǰBOEǰUSBOTQBSFOUǰNBOBHFNFOUǰJOǰPSEFSǰUPǰCVJMEǰSFMJBCJMJUZǰBOEǰ DPOųEFODFǰUPǰTIBSFIPMEFST ǰJOWFTUPST ǰBOEǰBMMǰTUBLFIPMEFSTǰ5IFǰDPNQBOZǰJTǰFOHBHFEǰJOǰUIFǰEFWFMPQNFOUǰBOEǰQSPNPUJPOǰPGǰFEVDBUJPO ǰ environmental and social which will lead to stability, progress, and sustainable growth of the company. 5IFǰ$PNQBOZǰIBTǰBQQPJOUFEǰTVCDPNNJUUFFTǰUPǰUIPSPVHIMZǰBOEǰFGųDJFOUMZǰDPOTJEFSǰJNQPSUBOUǰNBUUFSTǰBTǰTQFDJųFEǰJOǰUIFǰDIBSUFSǰPGǰ FBDIǰDPNNJUUFFǰ5IFǰDPNNJUUFFTǰIPMEǰNFFUJOHTǰBOEǰSFQPSUǰUIFJSǰPQFSBUJOHǰSFTVMUTǰUPǰUIFǰ#PBSEǰPGǰ%JSFDUPSTǰPOǰBǰSFHVMBSǰCBTJT ǰBTǰXFMMǰ as report their performance to the shareholders for acknowledgement in the annual report, which will help promote and support the $PNQBOZĴTǰPWFSBMMǰPQFSBUJPOTǰUPǰBDIJFWFǰPCKFDUJWFTǰBOEǰDPNQMZǰXJUIǰUIFǰQSJODJQMFǰPGǰHPPEǰDPSQPSBUFǰHPWFSOBODF 5IFǰ#PBSEǰPGǰ%JSFDUPSTǰIBTǰTFUǰUPǰIBWFǰUIFǰQPMJDJFTǰPOǰDPSQPSBUFǰHPWFSOBODFǰBOEǰFUIJDTǰBOEǰDPEFǰPGǰDPOEVDUǰGPSNVMBUFEǰTJODFǰ ǰ with the review, revision, and improvement thereof being made to suit the circumstances, comply with additional guidelines issued by SFHVMBUPSZǰBHFODJFT ǰBOEǰNFFUǰJOUFSOBUJPOBMǰTUBOEBSET ǰGPSǰUIFǰ#PBSEǰPGǰ%JSFDUPSTǰUPǰDPOTJEFSǰPOǰBǰSFHVMBSǰCBTJTǰ$VSSFOUMZǰUIFǰNBOVBMǰ considered as operating guidelines is Corporate Governance and Ethics Manualǰ thǰSFWJTJPO ǰFGGFDUJWFǰ"VHVTUǰ ǰǰPOXBSET *Oǰ ǰUIFǰ$PSQPSBUFǰ(PWFSOBODFǰBOEǰ&UIJDTǰ$PNNJUUFFǰIBTǰDPOUJOVFEǰUPǰQSPNPUFǰBOEǰTVQQPSUǰUIFǰ$PNQBOZǰGPSǰBǰHPPEǰDPSQPSBUFǰ governance to be comparable to international standards, so the Corporate Governance and Ethics Manual had been revised so BTǰUPǰCFǰJOǰDPNQMJBODFǰXJUIǰUIFǰ4UPDLǰ&YDIBOHFǰPGǰ5IBJMBOE ǰ5IBJǰ*OTUJUVUFǰPGǰ%JSFDUPST ǰBOEǰ"4&"/ǰ$PSQPSBUFǰ(PWFSOBODFǰ4DPSFDBSEǰ )BWJOHǰBEIFSFEǰUPǰBOEǰTFSJPVTMZǰEFWFMPQFEǰJUTǰQPMJDZǰPOǰDPSQPSBUFǰHPWFSOBODFǰPOǰBǰDPOUJOVFEǰCBTJT ǰUIFǰ$PNQBOZǰXBTǰFWBMVBUFEǰBOEǰ SFDFJWFEǰBXBSETǰGSPNǰWBSJPVTǰPSHBOJ[BUJPOTǰBTǰGPMMPXT ǰ 'PSǰFWBMVBUJPOǰPGǰDPSQPSBUFǰHPWFSOBODFǰSFQPSUTǰPGǰ5IBJǰMJTUFEǰDPNQBOJFTǰCZǰUIFǰ5IBJǰ*OTUJUVUFǰPGǰ%JSFDUPSTǰ *0% ǰUIFǰ$PNQBOZǰ ǰ XBTǰSBUFEǰĶ7FSZǰ(PPEķǰJOǰ ǰ ǰ ǰBOEǰ ǰ JOǰ ǰUIFSFǰXBTǰOPǰTVSWFZǰPOǰDPSQPSBUFǰHPWFSOBODFǰPGǰMJTUFEǰDPNQBOJFT ǰ ǰ BOEǰĶ&YDFMMFOUǰ ǰ4UBST ķǰGPSǰUISFFǰDPOTFDVUJWFǰZFBST ǰJOǰ ǰ ǰBOEǰ ǰ 'PSǰUIFǰFWBMVBUJPOǰPGǰ"(.ǰ$IFDLMJTUǰRVBMJUZǰCZǰUIFǰ5IBJǰ*OWFTUPSTǰ"TTPDJBUJPO ǰUIFǰ$PNQBOZǰXBTǰSBUFEǰĶ7FSZǰ(PPEķǰJOǰ ǰ ǰ ǰ  ǰBOEǰǰBOEǰĶ7FSZǰ(PPEǰ4IPVMEǰCFǰBǰ3PMFǰ.PEFM ķǰJOǰǰBOEǰ ǰTDPSJOHǰGVMMZǰǰQPJOUTǰ ǰ 'PSǰUIFǰFWBMVBUJPOǰPGǰDPSQPSBUFǰHPWFSOBODFǰJOǰ"4&"/ǰDPVOUSJFTǰCZǰ"4&"/ǰ$BQJUBMǰ.BSLFUTǰ'PSVNǰ "$.' ǰUIFǰ$PNQBOZǰXBTǰǰPGǰ ǰ ǰMJTUFEǰDPNQBOJFTǰJOǰ5IBJMBOEǰUIBUǰIBWFǰCFFOǰFWBMVBUFEǰXJUIǰIJHIFTUǰTDPSFǰJOǰHPPEǰDPSQPSBUFǰHPWFSOBODF ǰ 5IFǰ$(ǰ$PNNJUUFFǰIBTǰDPOEVDUFEǰTFMGQFSGPSNBODFǰBTTFTTNFOUǰXIJDIǰDPNQSJTFTǰPGǰǰDBUFHPSJFTǰ4USVDUVSFǰBOEǰ$PNQPTJUJPOǰPGǰ ǰ UIFǰ$PNNJUUFF ǰ3PMFTǰBOEǰ3FTQPOTJCJMJUJFT ǰ.FFUJOH ǰ%VUJFTǰ1FSGPSNBODFǰPGǰUIFǰ$PNNJUUFFĴTǰ.FNCFST ǰBOEǰ4FMGǰ%FWFMPQNFOUǰ ǰ PGǰUIFǰ$PNNJUUFFĴTǰ.FNCFSTǰ5IFǰBTTFTTNFOUǰDSJUFSJBǰEJWJEFEǰJOUPǰǰMFWFMTǰǰǰFYDFMMFOU ǰǰǰHPPE ǰǰǰGBJS ǰǰǰVOTBUJTGBDUPSZ ǰ ǰ ǰǰOFFEǰJNQSPWFNFOUǰ5IFǰPWFSBMMǰBWFSBHFǰSFTVMUǰPGǰUIFǰTFMGBTTFTTNFOUǰPGǰUIFǰ$PNNJUUFFǰXBTǰFRVBMǰUPǰǰ 5IFǰ$PNQBOZǰXJMMǰTUJMMǰBEIFSFǰUPǰUIFǰQPMJDJFTǰPOǰHPPEǰDPSQPSBUFǰHPWFSOBODFǰBOEǰFUIJDTǰUIBUǰUIFǰ$PNQBOZǰIBTǰGPSNVMBUFEǰBOEǰTVQQPSUǰ its improvement and development as well as continued and suitable disclosure of the results of corporate governance performance, SFŴFDUJOHǰUIFǰFGųDJFOU ǰUSBOTQBSFOU ǰBOEǰFUIJDBMǰNBOBHFNFOUǰBOEǰBMTPǰQSPNPUFǰUIFǰ$PNQBOZĴTǰDPSQPSBUFǰHPWFSOBODFǰQSJODJQMFTǰUPǰ CFǰVQUPEBUFǰBOEǰDPOTJTUFOUǰXJUIǰUIFǰDIBOHFTǰUIBUǰXJMMǰSBJTFǰUIFǰTUBOEBSETǰBOEǰQSBDUJDFTǰPGǰDPSQPSBUFǰHPWFSOBODFǰPGǰUIFǰ$PNQBOZ

(Mr. Weerawong Chittmittrapap) Chairman of the Corporate Governance and Ethics Committee February 28, 2014


159

Corporate Governance Corporate Governance Policy

5IFǰ#PBSEǰPGǰ%JSFDUPSTǰTUSPOHMZǰCFMJFWFTǰJOǰCVTJOFTTǰPQFSBUJPOTǰXJUIǰ ethical practice, good corporate governance, and corporate social SFTQPOTJCJMJUJZ ǰXIJDIǰBSFǰųSNMZǰFNCFEEFEǰJOǰUIFǰPSHBOJ[BUJPOǰDVMUVSFǰǰ *Uǰ JTǰ JOUFHSBUFEǰ XJUIǰ UIFǰ PSHBOJ[BUJPOǰ WJTJPO ǰ NJTTJPO ǰ TUSBUFHZǰ BOEǰ HPBMǰUPǰCPPTUǰDPOųEFODFǰBNPOHǰUIFǰTIBSFIPMEFST ǰJOWFTUPST ǰBOEǰBMMǰ TUBLFIPMEFST ǰBOEǰUPǰCSJOHǰUIFǰ$PNQBOZǰUPǰCVTJOFTTǰEFWFMPQNFOUǰ along with participation in supporting the education, ethletics, society, and environment. 5IFǰ#PBSEǰPGǰ%JSFDUPSTǰJOJUJBUFEǰUIFǰDPNQJMBUJPOǰPGǰUIFǰųSTUǰ)BOECPPLǰ on corporate governance policy, business ethics, and code of conduct QPSUBCMFǰWFSTJPO ǰJTTVFEǰJOǰǰ*UǰIBTǰCFFOǰTFUǰUPǰCFǰSFWJTFE ǰBEEFEǰ or amended every two years or as deemed appropriate to ensure updatedness and alignment with the changing environment, as well BTǰSFMFWBODFǰUPǰBOZǰBEEJUJPOBMǰHVJEFMJOFTǰJTTVFEǰCZǰ4&5ǰPSǰSFMBUFEǰ SFHVMBUPSZǰ CPEJFT ǰ XIJDIǰ XJMMǰ FOIBODFǰ UIFǰ $PNQBOZĴTǰ DPSQPSBUFǰ governance up to international standards. *Oǰ ǰUIFǰ#PBSEǰPGǰ%JSFDUPSTǰBTTJHOFEǰUIFǰ$PSQPSBUFǰ(PWFSOBODFǰ BOEǰ #VTJOFTTǰ &UIJDTǰ $PNNJUUFFǰ UPǰ SFWJFXǰ UIFǰ QPMJDJFTǰ BOEǰ UIFǰ $PSQPSBUFǰ(PWFSOBODFǰBOEǰ#VTJOFTTǰ&UIJDTǰ.BOVBMǰGPSǰJNQSPWFNFOUǰJOǰ BDDPSEBODFǰXJUIǰUIFǰ*0%ĴTǰ4VSWFZǰPGǰ5IBJǰ-JTUFEǰ$PNQBOJFTĴǰ$PSQPSBUFǰ Governance, where criteria have been revised to comply with the BTTFTTNFOUǰDSJUFSJBǰPGǰ"4&"/ǰ$(ǰ4DPSFDBSEǰ1SPKFDU 5IFǰ#PBSEǰPGǰ%JSFDUPST ǰBUǰJUTǰ.FFUJOHǰ/PǰǰPOǰ"VHVTUǰ ǰ ǰ SFWJFXFEǰBOEǰBQQSPWFEǰUIFǰĜthǰWFSTJPOǰPGǰUIFǰ$PSQPSBUFǰ(PWFSOBODFǰ BOEǰ#VTJOFTTǰ&UIJDTǰ.BOVBMġǰXJUIǰNBKPSǰSFWJTJPOTǰBTǰGPMMPXT ǰ $IBOHJOHǰĜ7JTJPOǰBOEǰ%VUZġǰUPǰĜ7JTJPOǰBOEǰ.JTTJPOġǰBOEǰUIFǰ#PBSEǰ ǰ PGǰ%JSFDUPSTǰSFRVJSFEǰUIBUǰUIFǰ$PNQBOZĴTǰWJTJPOǰBOEǰNJTTJPOǰCFǰ reviewed at least every 5 years, so as to determine and adjust ǰ UIFǰ $PNQBOZĴTǰ CVTJOFTTǰ UBSHFUTǰ BOEǰ EJSFDUJPOTǰ UPǰ TVJUǰ UIFǰ situation as appropriate. ǰ %FUFSNJOBUJPOǰPGǰHVJEFMJOFTǰPOǰUIFǰOPNJOBUJPOǰBOEǰBQQPJOUNFOUǰ of directors by taking into consideration the appropriateness of ǰ UIFǰ#PBSEǰPGǰ%JSFDUPSTĴǰDPNQPTJUJPO ǰRVBMJųDBUJPOT ǰBCJMJUJFTǰBOEǰ diversity including consideration of the recruitment, selection and ǰ OPNJOBUJPOǰ PGǰ RVBMJųFEǰ QFSTPOTǰ GPSǰ EJSFDUPSTIJQǰ JOǰ DBTFǰ PGǰ ǰ SFUJSFNFOUǰ BOEPSǰ Bǰ WBDBODZǰ BOEPSǰ BOǰ BEEJUJPOBMǰ QPTUǰ JOǰ ǰ EJSFDUPSTIJQ ǰXIFSFǰOFDFTTBSZǰTLJMMTǰSFRVJSFEǰJOǰUIFǰ#PBSEǰPGǰ ǰ %JSFDUPSTǰXFSFǰDPOTJEFSFEǰCZǰVTJOHǰUIFǰ#PBSEǰ4LJMMǰ.BUSJYǰBTǰ ǰ BǰUPPM ǰJOǰBDDPSEBODFǰXJUIǰUIFǰ$PNQBOZĴTǰOFXǰDSJUFSJBǰPOǰUIFǰ nomination and appointment of directors. ǰ 4FUUJOHǰBOǰBEEJUJPOBMǰQPMJDZǰPOǰBǰRVPSVNǰPGǰUIFǰ#PBSEǰPGǰ%JSFDUPSTĴǰ ǰ NFFUJOHǰ UIBUǰ JOǰ QBTTJOHǰ Bǰ SFTPMVUJPO ǰ BUǰ MFBTUǰ ǰ PGǰ UIFǰ ǰ UPUBMǰOVNCFSǰPGǰEJSFDUPSTǰNVTUǰCFǰQSFTFOUFEǰ5IJTǰIBTǰCFFOǰ ǰ BǰQSBDUJDFǰPGǰUIFǰ$PNQBOZǰUISPVHIPVU ǰBMUIPVHIǰJOǰUIFǰQBTUǰJUǰ had not been determined as a policy. ǰ 4FUUJOHǰ BEEJUJPOBMǰ QSBDUJDFTǰ GPSǰ EJSFDUPSTǰ BOEǰ NBOBHFNFOUǰ ǰ CBTFEǰ POǰ UIFǰ EFųOJUJPOTǰ HJWFOǰ CZǰ UIFǰ 4&$ǰ BOEǰ 4&5 ǰ UPǰ ǰ SFQPSUǰUIFJSǰTIBSFǰUSBEJOHǰBUǰMFBTUǰǰEBZǰCFGPSFǰUIFǰUSBEJOHǰEBZǰ in accordance with the share trading report form, including ǰ SFMFWBOUǰ JOGPSNBUJPO ǰ UPǰ UIFǰ $PNQBOZǰ 4FDSFUBSZǰ GPSǰ GVSUIFSǰ ǰ TVCNJTTJPOǰUPǰUIFǰ#PBSEǰPGǰ%JSFDUPST ǰBTǰBQQSPQSJBUF

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&YUFOEJOHÇ° UIFÇ° #PBSEÇ° PGÇ° %JSFDUPSTÄ´Ç° BOOVBMÇ° QFSGPSNBODFÇ° BTTFTTNFOUÇ° UPÇ° DPWFSÇ° CPUIÇ° JOEJWJEVBMÇ° EJSFDUPSÄ´TÇ° QFSGPSNBODFÇ° BOEÇ°UIFÇ°#PBSEÇ°PGÇ°%JSFDUPSTÄ´Ç°QFSGPSNBODF Ç°GPSNFSMZÇ°DPWFSJOHÇ°POMZÇ° UIFÇ°#PBSEÄ´TÇ°QFSGPSNBODFÇ° &YUFOEJOHÇ° UIFÇ° BOOVBMÇ° QFSGPSNBODFÇ° BTTFTTNFOUÇ° UPÇ° DPWFSÇ° TVCDPNNJUUFFT Ç°GPSNFSMZÇ°DPWFSJOHÇ°POMZÇ°UIFÇ°"VEJUÇ°$PNNJUUFF &YUFOEJOHÇ°QPMJDJFTÇ°BOEÇ°QSBDUJDFTÇ°GPSÇ°UIFÇ°USFBUNFOUÇ°PGÇ°DSFEJUPSTÇ° in regard to guarantee conditions, fund management and default cases. *OÇ°BEEJUJPO Ç°UIFÇ°$PNQBOZÇ°IBTÇ°EJTDMPTFEÇ°JOGPSNBUJPO Ç°JOÇ°CPUIÇ°5IBJÇ°BOEÇ° &OHMJTI Ç°JOÇ°JUTÇ°XFCTJUFÇ°BTÇ°GPMMPXTÇ° Ç° 5IFÇ°$PNQBOZÇ°(SPVQÄ´TÇ°TUSVDUVSFT Ç° %JSFDUÇ°BOEÇ°JOEJSFDUÇ°TIBSFIPMEJOHÇ°PGÇ°EJSFDUPST Ç°NBKPSÇ°TIBSFIPMEFSTÇ° Ç° BOEÇ°IJHIMFWFMÇ°FYFDVUJWFT Ç° 1PMJDJFTÇ°POÇ°UIFÇ°#PBSEÇ°PGÇ°%JSFDUPSTÄ´Ç°DPNQPTJUJPOÇ°BOEÇ°TFSWJDFÇ°ZFBSTÇ° of each director Ç° 5IFÇ°$PNQBOZÄ´TÇ°"SUJDMFTÇ°PGÇ°"TTPDJBUJPO Ç° 5IFÇ°$PNQBOZÄ´TÇ°.FNPSBOEVNÇ°PGÇ°"TTPDJBUJPO Ç° $IBSUFSÇ°PGÇ°(SPVQÇ°&YFDVUJWFÇ°$PNNJUUFFÇ°BOEÇ°DIBSUFSÇ°PGÇ°UIFÇ°Ç° Ç° TVCDPNNJUUFFT Ç° OBNFMZ Ç° "VEJUÇ° $PNNJUUFF Ç° /PNJOBUJPOÇ° BOEÇ° Ç° 3FNVOFSBUJPOÇ°$PNNJUUFF Ç°3JTLÇ°.BOBHFNFOUÇ°$PNNJUUFFÇ°BOEÇ° Ç° $PSQPSBUFÇ°(PWFSOBODFÇ°BOEÇ°&UIJDTÇ°$PNNJUUFF Ç° &NQMPZFFÄ´TÇ°&UIJDTÇ° &NQMPZFFÄ´TÇ°$PEFÇ°PGÇ°$POEVDU

Ç° *OWFTUPSÇ°3FMBUJPOÄ´TÇ°&UIJDT 5IFÇ°DPSQPSBUFÇ°HPWFSOBODFÇ°QPMJDZÇ°PGÇ°UIFÇ°$PNQBOZÇ°BTÇ°TUJQVMBUFEÇ°JOÇ°UIFÇ° $PSQPSBUFÇ°(PWFSOBODFÇ°BOEÇ°#VTJOFTTÇ°&UIJDTÇ°.BOVBMÇ°DBOÇ°CFÇ°DPODMVEFEÇ° BTÇ°GPMMPXT Ç° 5IFÇ°#PBSEÇ°PGÇ°%JSFDUPST Ç°FYFDVUJWFT Ç°BOEÇ°FNQMPZFFTÇ°BEIFSFÇ°UPÇ° performing in compliance with the laws and applying corporate governance principles to business operations by integrating with Ç° UIFÇ° WJTJPO Ç° NJTTJPO Ç° TUSBUFHZ Ç° BOEÇ° -POHÇ° UFSNÇ° HPBMTÇ° PGÇ° UIFÇ° organization, as well as enhancing the organization to have an Ç° FGĹłDJFOUÇ°BENJOJTUSBUJPOÇ°TZTUFN Ç°XIJDIÇ°XJMMÇ°IFMQÇ°CPPTUÇ°DPOĹłEFODFÇ° of shareholders, investors, and all stakeholders. Ç° 5IFÇ°#PBSEÇ°PGÇ°%JSFDUPSTÇ°SFTQFDUTÇ°UIFÇ°SJHIUTÇ°PGÇ°TIBSFIPMEFST Ç°USFBUTÇ° all shareholders equally, and provides convenience to shareholders in the exercise of rights in various matters. Ç° 5IFÇ°#PBSEÇ°PGÇ°%JSFDUPSTÇ°QSPNPUFTÇ°UIFÇ°QSPDFTTÇ°PGÇ°FOIBODJOHÇ°HPPEÇ° Ç° SFMBUJPOTIJQÇ°BOEÇ°DPPQFSBUJPOÇ°CFUXFFOÇ°UIFÇ°$PNQBOZÇ°BOEÇ°BMMÇ° stakeholders and sets an appropriate communication channel for the purpose. Ç° 5IFÇ°#PBSEÇ°PGÇ°%JSFDUPSTÇ°TFUTÇ°QPMJDZÇ°BOEÇ°DPEFÇ°PGÇ°FUIJDTÇ°PGÇ°UIFÇ° Ç° $PNQBOZÇ° UPÇ° CFÇ° HVJEFMJOFTÇ° GPSÇ° BMMÇ° TUBLFIPMEFSTÇ° TVDIÇ° BTÇ° shareholders, customers and consumers, competitors, trade partners, creditors, employees, the community, the environment, and the society.


160

ANNUAL REPORT 2013

GMM GRAMMY

ǰ 5IFǰ#PBSEǰPGǰ%JSFDUPSTǰUBLFTǰUIFǰSPMFǰPGǰEFUFSNJOJOHǰWJTJPOǰBOEǰ mission, and approving guidelines for setting of business strategies, policies, plans, and budgets, as well as monitoring and supervising the management to take actions according to the ǰ QPMJDJFTǰFTUBCMJTIFEǰJOǰBOǰFGųDJFOUǰBOEǰFGGFDUJWFǰXBZ ǰJOǰPSEFSǰ to maximize business value and shareholder wealth. ǰ 5IFǰ#PBSEǰPGǰ%JSFDUPSTǰJOTUJUVUFTǰUIFǰPSHBOJ[BUJPOǰTUSVDUVSFǰXJUIǰ ǰ DMFBSǰEFMFHBUJPOǰPGǰEVUJFTǰBOEǰSFTQPOTJCJMJUJFTǰPGǰUIFǰ#PBSEǰPGǰ ǰ %JSFDUPST ǰ4VC$PNNJUUFFT ǰ(SPVQǰ$IJFGǰ&YFDVUJWFǰ0GųDFS ǰBOEǰ ǰ $IJFGǰ&YFDVUJWFǰ0GųDFSTǰJOǰFBDIǰCVTJOFTTǰMJOFT ǰBOEǰQVUTǰJOǰQMBDFǰ ǰ BQQSPQSJBUFǰBOEǰTVGųDJFOUǰJOUFSOBMǰDPOUSPMǰBOEǰBVEJUǰTZTUFN ǰ ǰ SJTLǰNBOBHFNFOUǰTZTUFN ǰQSFWFOUJPOǰPGǰDPOŴJDUTǰPGǰJOUFSFTUǰBOEǰ use of insider information. ǰ 5IFǰ#PBSEǰPGǰ%JSFDUPSTǰNPOJUPSTǰBOEǰFOTVSFTǰUIBUǰUIFǰQSFQBSBUJPOǰ ǰ PGǰųOBODJBMǰTUBUFNFOUTǰBOEǰJOGPSNBUJPOǰPGǰUIFǰ$PNQBOZǰJTǰJOǰ accordance with the generally accepted accounting standards, ǰ EJTDMPTVSFǰ PGǰ JOGPSNBUJPOǰ JTǰ TVGųDJFOUǰ BOEǰ SFMJBCMF ǰ BOEǰ UIFǰ ǰ $PNQBOZǰIBTǰDBQBCMFǰBOEǰJOEFQFOEFOUǰBVEJUPSǰ ǰ 5IFǰ#PBSEǰPGǰ%JSFDUPSTǰFOTVSFTǰUIBUǰUIFǰ$PNQBOZǰDPNNVOJDBUFTǰ ǰ BOEǰEJTDMPTFTǰJNQPSUBOUǰųOBODJBMǰPSǰOPOųOBODJBMǰJOGPSNBUJPOǰ ǰ SFMBUJOHǰUPǰUIFǰ$PNQBOZǰTVGųDJFOUMZ ǰBDDVSBUFMZ ǰDPNQMFUFMZ ǰ reliably, transparently, thoroughly, and in a timely manner, ǰ UISPVHIǰWBSJPVTǰDIBOOFMTǰBOEǰUIFǰ*OWFTUPSǰ3FMBUJPOTǰ%FQBSUNFOU ǰ which can be accessed conveniently and equitably. ǰ 5IFǰ#PBSEǰPGǰ%JSFDUPSTǰNBZǰBQQPJOUǰ#PBSEǰDPNNJUUFFTǰBTǰEFFNFEǰ appropriate to help screen important matters and report ǰ PQFSBUJOHǰSFTVMUTǰUPǰUIFǰ#PBSEǰPGǰ%JSFDUPSTĴǰNFFUJOHǰSFHVMBSMZ ǰ as well as report operating results to the shareholders in the ǰ BOOVBMǰSFQPSUǰPGǰUIFǰ$PNQBOZ ǰ 5IFǰ#PBSEǰPGǰ%JSFDUPSTǰBSSBOHFTǰUPǰIBWFǰBOOVBMǰTFMGBTTFTTNFOUǰ ǰ PGǰUIFǰ#PBSEǰPGǰ%JSFDUPSTǰBOEǰ4VCDPNNJUUFFTǰTVDIǰBTǰUIFǰ"VEJUǰ ǰ $PNNJUUFF ǰUIFǰ$PSQPSBUFǰ(PWFSOBODFǰBOEǰ&UIJDTǰ$PNNJUUFF ǰ ǰ UIFǰ 3JTLǰ .BOBHFNFOUǰ$PNNJUUFFǰGPSǰVTFǰBTǰBǰGSBNFXPSLǰ JOǰ evaluation of their performance in the previous year, so that ǰ SFDUJųDBUJPOǰBOEǰJNQSPWFNFOUǰDBOǰCFǰNBEFǰUPǰJODSFBTFǰFGųDJFODZ ǰ ǰ BOEǰUIFǰTFMGBTTFTTNFOUǰSFTVMUTǰXJMMǰCFǰSFQPSUFEǰUPǰUIFǰ#PBSEǰ meeting for acknowledgement. ǰ 5IFǰ#PBSEǰPGǰ%JSFDUPSTǰQVUTǰJOǰQMBDFǰBOǰBQQSPQSJBUF ǰUSBOTQBSFOU ǰ and fair recruitment system for all crucial management positions. ǰ 5IFǰ#PBSEǰPGǰ%JSFDUPSTǰIBTǰBOǰJNQPSUBOUǰSPMFǰPGǰBSSBOHJOHǰGPSǰUIFǰ ǰ XSJUUFOǰ$PSQPSBUFǰ(PWFSOBODFǰBOEǰ#VTJOFTTǰ&UIJDTǰ.BOVBMǰTPǰUIBUǰ all directors, executives, and employees acknowledge, understand, and abide by the practice of corporate governance and business ethics in a strict manner, and establishing a compliance monitoring measure thereon. 5PǰFOTVSFǰUIFǰJNQMFNFOUBUJPOǰPGǰCVTJOFTTǰFUIJDTǰBOEǰDPEFǰPGǰDPOEVDU ǰ UIFǰ$PNQBOZǰIBTǰTUJQVMBUFEǰUIBUǰUIFǰEJSFDUPST ǰUIFǰNBOBHFNFOU ǰBOEǰ all employees acknowledge, understand, and strictly comply with QPMJDJFTǰBOEǰQSPDFEVSFTǰTFUǰGPSUIǰJOǰUIFǰ$PSQPSBUFǰ(PWFSOBODFǰBOEǰ #VTJOFTTǰ&UIJDTǰ.BOVBM ǰFYFDVUJWFTǰBUǰBMMǰMFWFMTǰJOǰUIFǰPSHBOJ[BUJPOǰ have to be responsible for and treat this matter with great importance so that their subordinates will follow suit in a rigorous manner.

*UǰJTǰVOEFTJSBCMFǰUIBUǰBOZǰVOMBXGVMǰQSBDUJDFǰXIJDIǰJTǰBHBJOTUǰFUIJDBMǰ DPOEVDUǰUBLFǰQMBDFǰ"OZǰEJSFDUPST ǰFYFDVUJWFT ǰBOEǰFNQMPZFFTǰXIPǰ conduct in a way deemed unethical shall be subject to be condemned QVSTVBOUǰUPǰUIFǰSVMFTǰBOEǰSFHVMBUJPOTǰJOǰQMBDFǰ5IFǰ$PNQBOZǰIBTǰ arranged for a special unit to compile general complaints, violation of the rights of stakeholders, corruption, unlawful behavior, breaches PGǰUIFǰCVTJOFTTǰFUIJDTǰBOEǰDPEFǰPGǰDPOEVDU ǰRVFSJFTǰBCPVUǰųOBODBMǰ SFQPSUT ǰPSǰUIFǰJOUFSOBMǰDPOUSPMǰTZTUFN ǰGPSǰTVCNJTTJPOǰUPǰUIFǰ"VEJUǰ $PNNJUUFFǰ XIJDIǰ JTǰ DPNQPTFEǰ PGǰ JOEFQFOEFOUǰ EJSFDUPSTǰ BUǰ auditcommittee@gmmgrammy.com for further consideration and TVCNJTTJPOǰUPǰUIFǰ#PBSEǰPGǰ%JSFDUPST *Oǰ  ǰ UIFSFǰ XBTǰ OFJUIFSǰ DPNQMBJOUǰ OPSǰ RVFSZǰ TVCNJUUFEǰ WJBǰ auditcommittee@gmmgrammy.com., nor action in a manner that violated or failed to comply with applicable laws, rules and regulations PGǰ4&5ǰBOEǰ4&$ *OǰBEEJUJPO ǰUIFǰ#PBSEǰPGǰ%JSFDUPSTǰIBTǰBǰQPMJDZǰUPǰFODPVSBHFǰUIFǰ dissemination of corporate governance culture in various forms for awareness at all levels and for translation into practice by preparing BOEǰ EJTTFNJOBUJOHǰ UIFǰ $PSQPSBUFǰ (PWFSOBODFǰ BOEǰ #VTJOFTTǰ &UIJDTǰ .BOVBMǰUISPVHIǰTFWFSBMǰDIBOOFMTǰTVDIǰBTǰ&NBJM ǰUIFǰ(3"..:ǰ(SPVQĴTǰ *OUSBOFUǰ IUUQXXXHNNDMJDLHN ǰ BOEǰ UIFǰ $PNQBOZĴTǰ XFCTJUFǰ IUUQXXXHNNHSBNNZDPN ǰǰ%JSFDUPST ǰFYFDVUJWFT ǰBOEǰFNQMPZFFTǰ will accordingly be aware of and abide by the principles of corporate governance and business ethics in performing their duties with accountability, transparency, integrity, prudence, and ethics towards oneself, the organization, the shareholders, and other stakeholders. "DUJWJUJFTǰBSFǰUPǰCFǰIFMEǰUPǰFOIBODFǰLOPXMFEHF ǰVOEFSTUBOEJOH ǰBOEǰ conscience in performing duties responsibly, cautiously and honestly under the corporate governance principles and business ethics of UIFǰ$PNQBOZ "TǰUIFǰ$PNQBOZǰIBTǰBMMǰBMPOHǰBEIFSFEǰUPǰUIFǰQPMJDZǰPOǰDPSQPSBUFǰ governance and business ethics in its business operations and has EFWFMPQFEǰJUTǰDPSQPSBUFǰHPWFSOBODFǰQSBDUJDFǰUPǰCFǰNPSFǰFGųDJFOUǰBOEǰ TVJUǰUIFǰ$PNQBOZ ǰUIFǰ$PNQBOZǰIBTǰCFFOǰSBUFEǰCZǰWBSJPVTǰBHFODJFTǰ BTǰGPMMPXT 2 Corporate Governance Report of Listed Companies 2013 ǰ "DDPSEJOHǰUPǰUIFǰ$PSQPSBUFǰ(PWFSOBODFǰ3FQPSUǰPGǰ5IBJǰ-JTUFEǰ ǰ $PNQBOJFTǰQSFQBSFEǰCZǰUIFǰ5IBJǰ*OTUJUVUFǰPGǰ%JSFDUPSTǰXJUIǰTVQQPSUǰ ǰ PGǰ UIFǰ 4UPDLǰ &YDIBOHFǰ PGǰ 5IBJMBOEǰ 4&5 ǰ BOEǰ UIFǰ 0GųDFǰ PGǰ ǰ 4FDVSJUJFTǰBOEǰ&YDIBOHFǰ$PNNJTTJPOǰ 4&$ ǰUIFǰSFTVMUǰPGǰUIFǰ ǰ DPSQPSBUFǰ HPWFSOBODFǰ SFQPSUǰ FWBMVBUJPOǰ PGǰ UIFǰ $PNQBOZǰ ǰ SFNBJOFEǰBUǰUIFǰMFWFMǰPGǰĶFYDFMMFOUǰǰTUBSTķǰXJUIǰǰQPJOUTǰ ǰ BTǰJOǰǰBOEǰ ǰXIJMFǰUIFǰBWFSBHFǰTDPSFǰPGǰBMMǰUIFǰǰ listed companies under the survey was 78 points. 2 Quality of Annual General Meeting of Shareholders 2013 ǰ "DDPSEJOHǰUPǰUIFǰFWBMVBUJPOǰPGǰUIFǰRVBMJUZǰPGǰBOOVBMǰHFOFSBMǰNFFUJOHTǰ ǰ PGǰTIBSFIPMEFSTǰ "(.ǰDIFDLMJTU ǰPGǰMJTUFEǰDPNQBOJFTǰDBSSJFEǰPVUǰ ǰ CZǰ UIFǰ 5IBJǰ *OWFTUPSTǰ "TTPDJBUJPO ǰ UIFǰ SFTVMUǰ PGǰ UIFǰ RVBMJUZǰ ǰ FWBMVBUJPOǰ PGǰ UIFǰ $PNQBOZĴTǰ ǰ "OOVBMǰ (FOFSBMǰ .FFUJOHǰ ǰ PGǰ4IBSFIPMEFSTǰXBTǰSBUFEǰĶTVQFSCķǰXJUIǰǰQPJOUT ǰXIJMFǰUIFǰ ǰ BWFSBHFǰ TDPSFǰ PGǰ BMMǰ UIFǰ ǰ MJTUFEǰ DPNQBOJFTǰ VOEFSǰ UIFǰ ǰ TVSWFZǰXBTǰǰQPJOUT ǰ5IFǰSFTVMUTǰPGǰUIFǰRVBMJUZǰFWBMVBUJPOǰPGǰ ǰ UIFǰ$PNQBOZĴTǰBOOVBMǰHFOFSBMǰNFFUJOHTǰPGǰTIBSFIPMEFSTǰJOǰǰ ǰ BOEǰ ǰXFSFǰSBUFEǰĶTVQFSC ķǰBOEǰĶFYDFMMFOUķǰSFTQFDUJWFMZ


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2 ASEAN CG Scorecard Country Reports and Assessment 2012-2013 Ç° "4&"/Ç°$BQJUBMÇ°.BSLFUTÇ°'PSVNÇ° "$.' Ç°XJUIÇ°TVQQPSUÇ°PGÇ°"TJBOÇ° Ç° %FWFMPQNFOUÇ° #BOLÇ° "%# Ç° JOÇ° DPPQFSBUJPOÇ° XJUIÇ° DPSQPSBUFÇ° governance experts in each country, assessed corporate governance of listed companies in 6 participating countries, Ç° OBNFMZ Ç°*OEPOFTJB Ç°.BMBZTJB Ç°UIFÇ°1IJMJQQJOFT Ç°4JOHBQPSF Ç°7JFUOBNÇ° Ç° BOEÇ°5IBJMBOE Ç°BTÇ°BÇ°QJMPUÇ°QSPKFDUÇ°GPSÇ°UIFÇ°BQQMJDBUJPOÇ°PGÇ°"4&"/Ç°$(Ç° Ç° 4DPSFDBSEÇ°JOÇ°"4&"/Ç°DPVOUSJFT Ç° "DDPSEJOHÇ° UPÇ° "4&"/Ç° $(Ç° 4DPSFDBSEÇ° $PVOUSZÇ° 3FQPSUTÇ° BOEÇ° Ç° "TTFTTNFOUÇ°Ç°GPSÇ°5IBJMBOE Ç°UIFÇ°$PNQBOZÄ´TÇ°$(Ç°TDPSFÇ° Ç° SBOLFEÇ°BNPOHÇ°UIFÇ°UPQÇ°Ç°MJTUFEÇ°DPNQBOJFTÇ°PGÇ°5IBJMBOE Ç° 5IFÇ°$PNQBOZÇ°JTÇ°TUJMMÇ°DPNNJUUFEÇ°UPÇ°EFWFMPQJOHÇ°JUTFMGÇ°DPOUJOVPVTMZÇ° Ç° JOÇ°QSPNPUJOHÇ°UIFÇ°$PNQBOZÄ´TÇ°DPSQPSBUFÇ°HPWFSOBODFÇ°QSPDFTT Ç°BTÇ° Ç° UIFÇ°$PNQBOZÇ°CFMJFWFTÇ°UIBUÇ°BEIFSFODFÇ°UPÇ°UIFÇ°TZTUFNÇ°BOEÇ°QSPDFTTÇ° of corporate governance will contribute to sustainable growth.

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Ç° Ç° Ç° Ç° Corporate Governance Ç° $PSQPSBUFÇ°(PWFSOBODFÇ°PGÇ°DPNQBOZÇ°JTÇ°EJWJEFEÇ°JOUPÇ°Ç°DBUFHPSJFTÇ° Ç° Ç° s Rights of Shareholders Ç° s &RVJUBCMFÇ°5SFBUNFOUÇ°PGÇ°4IBSFIPMEFST Ç° s Roles of Stakeholders Ç° s %JTDMPTVSFÇ°BOEÇ°5SBOTQBSFODZ s 3FTQPOTJCJMJUJFTÇ°PGÇ°UIFÇ°#PBSEÇ°PGÇ°%JSFDUPST Ç°

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 Ç° 5IFÇ°$PNQBOZÇ°BOOPVBODFTÇ°UIFÇ°UJNFGSBNFÇ°GPSÇ°BDDFQUBODFÇ° Ç° PGÇ°NBUUFSTÇ°WJBÇ°4&5Ä´TÇ°DIBOOFMÇ°BOEÇ°UIFÇ°$PNQBOZÄ´TÇ°XFCTJUFÇ° Ç° BUÇ°MFBTUÇ°UISFFÇ°NPOUITÇ°QSJPSÇ°UPÇ°UIFÇ°MBTUÇ°EBZÇ°PGÇ°UIFǰųTDBMÇ°ZFBSÇ° and also send the criteria to submit queries in advance, Ç° BUUBDIFEÇ° UPÇ° UIFÇ° /PUJDFÇ° PGÇ° "OOVBMÇ° (FOFSBMÇ° .FFUJOHÇ° PGÇ° shareholders.  Ç° 5IFÇ°$PNQBOZÇ°TIPXTÇ°EFUBJMTÇ°PGÇ°RVBMJųDBUJPOTÇ°PGÇ°QFSTPOTÇ° entitield to make proposal, relevant conditions, and consideration procedure, and provides convenience to shareholders by allowing them to download a form via Ç° UIFÇ° $PNQBOZÄ´TÇ° XFCTJUFÇ° POÇ° UIFÇ° NFOVÇ° Ķ$PSQPSBUFÇ° Ç° (PWFSOBODFÄ· Ç° JUFNÇ° Ķ4IBSFIPMEFSTÇ° *OGPSNBUJPOÄ·Ç° Ç° 4IBSFIPMEFSTÇ°DBOÇ°TFOEÇ°UIFÇ°GPSNÇ°VOPGųDJBMMZÇ°UPÇ°UIFÇ°$PNQBOZÇ° Secretary via electronic mail or fax before submitting the Ç° PSJHJOBMÇ°WFSTJPOÇ°XIJDIÇ°IBTÇ°CFFOÇ°DPNQMFUFMZǰųMMFEÇ°PVUÇ°BOEÇ° Ç° TVQQPSUJOHÇ° EPDVNFOUTÇ° UPÇ° UIFÇ° $PNQBOZÇ° 4FDSFUBSZÇ° 5IFÇ° Ç° $PNQBOZÇ°4FDSFUBSZÇ°XJMMÇ°QSPQPTFÇ°UIFÇ°NBUUFSTÇ°QSPQPTFEÇ° Ç° CZÇ° UIFÇ° TIBSFIPMEFSTÇ° UPÇ° UIFÇ° #PBSEÇ° PGÇ° %JSFDUPSTÇ° GPSÇ° Ç° DPOTJEFSBUJPOÇ° *OÇ° DBTFÇ° PGÇ° OPNJOBUJPOÇ° PGÇ° EJSFDUPST Ç° UIFÇ° Ç° $PNQBOZÇ° 4FDSFUBSZÇ° XJMMÇ° TVCNJUÇ° DBOEJEBUFTÇ° UPÇ° UIFÇ° Ç° /PNJOBUJPOÇ° BOEÇ° 3FNVOFSBUJPOÇ° $PNNJUUFFÇ° UPÇ° DPOTJEFSÇ° Ç° RVBMJųDBUJPOTÇ°BOEÇ°QSPQPTFÇ°UPÇ°UIFÇ°#PBSEÇ°PGÇ°%JSFDUPSTÇ°GPSÇ° Ç° DPOTJEFSBUJPOÇ°BOEÇ°QSPQPTFÇ°UPÇ°UIFÇ°TIBSFIPMEFSTÄ´Ç°NFFUJOHÇ° for vote.  Ç° *OÇ° DBTFÇ° UIFÇ° #PBSEÇ° PGÇ° %JSFDUPSTÇ° BQQSPWFTÇ° UIFÇ° QSPQPTFEÇ° matters and names as considered appropriate, the Ç° $PNQBOZÇ°XJMMÇ°BEEÇ°TVDIÇ°NBUUFSTÇ°BOEÇ°OBNFTÇ°UPÇ°UIFÇ°JOWJUBUJPOÇ° notice by indicating that the matters and names have been proposed by the shareholders together with opinions of Ç° UIFÇ°#PBSEÇ°PGÇ°%JSFDUPSTÇ°*OÇ°DBTFÇ°UIFÇ°QSPQPTFEÇ°NBUUFSTÇ°BOEÇ° Ç° OBNFTÇ°BSFÇ°EJTBQQSPWFE Ç°UIFÇ°#PBSEÇ°PGÇ°%JSFDUPSTÇ°XJMMÇ°NBLFÇ° Ç° BOOPVODFNFOUÇ°UPHFUIFSÇ°XJUIÇ°DMBSJųDBUJPOÇ°UIFSFPOÇ°UISPVHIÇ° Ç° 4&5Ä´TÇ°DIBOOFMÇ°BOEÇ°UIFÇ°$PNQBOZÄ´TÇ°XFCTJUFÇ°POÇ°UIFÇ°NFOVÇ° Ç° Ķ$PSQPSBUFÇ°(PWFSOBODFÄ· Ç°JUFNǰĶ4IBSFIPMEFSTÇ°*OGPSNBUJPOÄ·Ç° Ç° BOEÇ°OPUJGZÇ°UIFÇ°TIBSFIPMEFSTÇ°BHBJOÇ°BUÇ°UIFÇ°TIBSFIPMEFSTÄ´Ç° meeting. Ç° *OÇ° Ç°UIFÇ°$PNQBOZÇ°BMMPXFEÇ°UIFÇ°TIBSFIPMEFSTÇ°UPÇ°QSPQPTFÇ° Ç° JOÇ° BEWBODFÇ° NBUUFSTÇ° EFFNFEÇ° TJHOJųDBOUÇ° GPSÇ° BEEJUJPOÇ° JOÇ° Ç° UIFÇ°BHFOEBÇ°PGÇ°UIFÇ°$PNQBOZÄ´TÇ°Ç°"OOVBMÇ°(FOFSBMÇ°.FFUJOHÇ° of Shareholders and to nominate persons who have Ç° LOPXMFEHF Ç°FYQFSUJTF Ç°BOEÇ°RVBMJųDBUJPOTÇ°GPSÇ°FMFDUJPOÇ°BTÇ° directors. Shareholders can make proposal from September Ç°  Ç°Ç°VOUJMÇ°+BOVBSZÇ° Ç°Ç°POÇ°UIFÇ°$PNQBOZÄ´TÇ°XFCTJUFÇ° Ç° POÇ°UIFÇ°NFOVǰĶ$PSQPSBUFÇ°(PWFSOBODFÄ· Ç°JUFNǰĶ4IBSFIPMEFSTÇ° Ç° *OGPSNBUJPOÇ°*UÇ°IBTÇ°DPNFÇ°PVUÇ°UIBU Ç°EVSJOHÇ°UIFÇ°EFTJHOBUFEÇ° period, no shareholder proposed any agenda item or Ç° OPNJOBUFEÇ°BOZÇ°RVBMJųFEÇ°QFSTPOÇ°UPÇ°BTTVNFÇ°UIFÇ°QPTUÇ°PGÇ° Ç° EJSFDUPSÇ°UPÇ°UIFÇ°$PNQBOZ Rights to attend the shareholdersâ&#x20AC;&#x2122; meetings 5IFÇ°#PBSEÇ°PGÇ°%JSFDUPSTÇ°TVQQPSUTÇ°PSHBOJ[JOHÇ°PGÇ°UIFÇ°TIBSFIPMEFSTÄ´Ç° meetings which take into account the rights and equitabilitiy of shareholders for the attendance of meetings according to the MBXTÇ°BOEÇ°HPPEÇ°DPSQPSBUFÇ°HPWFSOBODFÇ°QSJODJQMFTÇ°5IFÇ°BOOVBMÇ° general meeting of shareholders is set to be held once a year


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ANNUAL REPORT 2013

GMM GRAMMY

XJUIJOǰǰNPOUITǰGSPNǰUIFǰMBTUǰEBZǰPGǰUIFǰųTDBMǰZFBSǰ 5IFǰ$PNQBOZĴTǰ MBTUǰEBZǰPGǰUIFǰųTDBMǰZFBSǰJTǰ%FDFNCFSǰǰPGǰFBDIǰZFBS ǰ*OǰDBTFǰ where there are urgent matters for special meetings to discuss JTTVFTǰUIBUǰBGGFDUǰPSǰSFMBUFǰUPǰUIFǰTIBSFIPMEFSTĴǰCFOFųUTǰPSǰBSFǰ related to regulations, laws that require urgent approval from the shareholders, there will be a call for an extraordinary meeting PGǰTIBSFIPMEFSTǰDBTFǰCZǰDBTFǰ5IFǰ$PNQBOZĴTǰHVJEFMJOFTǰBSFǰBTǰ GPMMPXT  ǰ #FGPSFǰUIFǰEBUFǰPGǰUIFǰTIBSFIPMEFSTĴǰNFFUJOH 2ǰ 1SFTFOUBUJPOǰBOEǰ*OGPSNBUJPOǰ%FMJWFSZǰUPǰ4IBSFIPMEFSTǰ ǰ ǰ 5IFǰ $PNQBOZǰ IBTǰ BQQPJOUFEǰ 5IBJMBOEǰ 4FDVSJUJFTǰ ǰ ǰ %FQPTJUPSZǰ$P ǰ-UEǰ 54% ǰBTǰJUTǰTFDVSJUJFTǰSFHJTUSBSǰUPǰ send the meeting invitation notice, documents, and other information which is important and necessary ǰ ǰ GPSǰEFDJTJPONBLJOHǰUPǰTIBSFIPMEFSTǰ JOǰ&OHMJTIǰJOǰDBTFǰ ǰ ǰ PGǰGPSFJHOǰTIBSFIPMEFST ǰBUǰMFBTUǰǰEBZTǰQSJPSǰUPǰUIFǰ ǰ ǰ NFFUJOHǰ*OǰBEEJUJPO ǰUIFǰ$PNQBOZǰIBTǰEJTTFNJOBUFEǰ the invitation notice and all relevant information ǰ ǰ FYDMVEJOHǰBOOVBMǰSFQPSU ǰPOǰJUTǰXFCTJUFǰJOǰ5IBJǰBOEǰ ǰ ǰ &OHMJTIǰ NPSFǰ UIBOǰ ǰ EBZTǰ QSJPSǰ UPǰ UIFǰ NFFUJOHǰ TPǰ ǰ ǰ UIBUǰTIBSFIPMEFSTǰXJMMǰIBWFǰTVGųDJFOUǰUJNFǰUPǰTUVEZǰUIFǰ ǰ ǰ JOGPSNBUJPOǰJOǰBEWBODFǰGPSǰEFDJTJPONBLJOHǰǰ*OǰBEEJUJPO ǰ ǰ ǰ UIFǰ$PNQBOZǰBEWFSUJTFEǰNFFUJOHǰOPUJDFTǰJOǰOFXTQBQFSTǰ to inform shareholders of the date, time, venue and ǰ ǰ BHFOEBǰ JUFNTǰ JOǰ CPUIǰ 5IBJǰ BOEǰ &OHMJTIǰ GPSǰ UISFFǰ consecutive days at least 7 days in advance of the meeting.  2ǰ 'BDJMJUBUJPOǰ BOEǰ FODPVSBHFNFOUǰ GPSǰ TIBSFIPMEFSTǰ UPǰ attend the meeting, including institutional investors, ǰ ǰ XJUIǰUIFǰGPMMPXJOHǰQPMJDJFT Meeting venue at a suitable location, with enough parking spaces and convenience transportation, with the ǰ ǰ WFOVFĴTǰNBQǰCFJOHǰFODMPTFEǰXJUIǰUIFǰNFFUJOHǰOPUJDF Meeting schedule not on a public holiday or during long ǰ ǰ IPMJEBZTǰPGǰBUǰMFBTUǰǰDPOTFDVUJWFǰEBZT ǰOPUǰUPPǰFBSMZǰ in the morning or late in the evening. 1SPYZǰ 5IFǰ ǰ UZQFTǰ PGǰ QSPYZǰ GPSNTǰ XJUIǰ JOTUSVDUJPOTǰ thereof delivered with stamp duty provided free of charge for convenience in sending the valid proxy form with ǰ ǰ TVQQPSUJOHǰ EPDVNFOUTǰ JOǰ BEWBODFǰ UPǰ UIFǰ $PNQBOZǰ ǰ ǰ 4FDSFUBSZǰQSJPSǰUPǰUIFǰNFFUJOHǰEBZǰGPSǰUIFǰ$PNQBOZĴTǰ ǰ ǰ TUBGGǰUPǰFYBNJOFǰUIFǰEPDVNFOUTǰCFGPSFǰUIFǰQSPYZĴTǰBSSJWBM Staff and technology in place to provide services and ǰ ǰ FYBNJOFǰEPDVNFOUTǰGPSǰUIFǰNFFUJOHĴTǰQBSUJDJQBOUT ǰGPSǰ ǰ ǰ UIFǰTBLFǰPGǰDPOWFOJFODF ǰTQFFE ǰBDDVSBDZǰBOEǰWFSJųBCJMJUZ 2ǰ *OGPSNBUJPOǰ%JTDMPTVSFǰPGǰFBDIǰ"HFOEBǰJOǰUIFǰ*OWJUBUJPOǰ ǰ ǰ /PUJDFǰ0QJOJPOTǰPGǰUIFǰ#PBSEǰPGǰ%JSFDUPSTǰPGǰFBDIǰ"HFOEBǰ ǰ ǰ BTǰXFMMǰBTǰQVSQPTFTǰBOEǰSFBTPOǰ#PUIǰQPTJUJWFǰBOEǰOFHBUJWFǰ ǰ ǰ JGǰBOZ ǰBSFǰDMFBSMZǰJOEJDBUFEǰ'PSǰUIFǰTIBSFIPMEFSTĴǰNFFUJOHǰ ǰ ǰ XJMMǰIBWFǰǰUIFǰGPMMPXJOHǰBHFOEBǰJUFNT ǰ ǰ %JTDMPTVSFǰ PGǰ 'JOBODJBMǰ 1FSGPSNBODFǰ UPǰ DMBSJGZǰ UIFǰ ǰ ǰ ųOBODJBMǰQFSGPSNBODFǰJOǰUIFǰQSFWJPVTǰZFBSǰJODMVEJOHǰ ǰ ǰ BTTFUT ǰSFWFOVF ǰFYQFOTFTǰBOEǰQSPųUMPTT

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ǰ 3FNVOFSBUJPOǰPGǰ%JSFDUPSTǰUPǰDMBSJGZǰUIFǰHVJEFMJOFǰPGǰ ǰ 3FNVOFSBUJPOǰPGǰ%JSFDUPSǰJOǰCPUIǰNPOFUBSZǰ FHǰNFFUJOHǰ ǰ BMMPXBODF ǰBOOVBMǰCPOVT ǰBOEǰPUIFSǰCFOFųUTǰBHSFFEǰCZǰ the nomination and remuneration committee. ǰ /PNJOBUJPOǰPGǰEJSFDUPST ǰUIFǰ$PNQBOZǰJOEJDBUFTǰUIFǰ ǰ EJSFDUPSTĴǰOBNFTǰBOEǰTVNNBSJ[FTǰQSPųMFǰPGǰFBDIǰEJSFDUPSǰ to be nominated, such as name and surname, age, ǰ FEVDBUJPOǰ CBDLHSPVOE ǰ XPSLǰ QSPųMF ǰ OVNCFSǰ PGǰ companies in which such person is a director by divided into listed companies and other companies, positions ǰ JOǰ PUIFSǰ DPNQFUJUPSSFMBUFEǰ DPNQBOJFTǰ XIJDIǰ NBZǰ ǰ DBVTFǰBOZǰDPOŴJDUǰPGǰJOUFSFTUT ǰOPNJOBUJPOǰDSJUFSJBǰBOEǰ procedure, type of director to be proposed such as ǰ %JSFDUPSǰPSǰ*OEFQFOEFOUǰ%JSFDUPSǰ*OǰDBTFǰPGǰOPNJOBUJPOǰ of the existing director to reassume the position, ǰ EFUBJMTǰPGǰIJTIFSǰNFFUJOHǰBUUFOEBODFǰJOǰUIFǰQSFWJPVTǰ ǰ ZFBS ǰ BOEǰ IJTIFSǰ UFSNZFBSTǰ JOǰ PGųDFǰ TIBMMǰ BMTPǰ CFǰ ǰ QSPWJEFEǰ*OǰDBTFǰPGǰUIFǰBQQPJOUNFOUǰPGǰJOEFQFOEFOUǰ ǰ EJSFDUPST ǰUIFǰ$PNQBOZǰTIBMMǰEJTDMPTFǰJUTǰEFųOJUJPOǰPGǰ ǰ ĶJOEFQFOEFOUǰEJSFDUPSķǰBTǰEFųOFEǰBOEǰEFUFSNJOFEǰUIBUǰ ǰ UIFǰ$PNQBOZĴTǰEFųOJUJPOǰJTǰFRVBMǰUPǰPSǰNPSFǰDPODFOUSBUFǰ ǰ UIBOǰUIFǰNJOJNVNǰSFRVJSFNFOUTǰPGǰUIFǰ4&$ǰBOEǰUIFǰ4&5 ǰ ǰ JODMVEJOHǰBOZǰJOGPSNBUJPOǰPGǰBOZǰDPOŴJDUǰPGǰJOUFSFTUTǰPGǰ ǰ TVDIǰ JOEFQFOEFOUǰ EJSFDUPSǰ POǰ UIFǰ $PNQBOZ ǰ JUTǰ ǰ TVCTJEJBSJFT ǰBGųMJBUFTǰPSǰFOUJUJFTǰNBZǰIBWFǰBǰDPOŴJDUǰBUǰ ǰ UIBUǰUJNFǰPSǰEVSJOHǰUIFǰMBTUǰǰZFBST /PNJOBUJPOǰ PGǰ BVEJUPSǰ BOEǰ ųYJOHǰ PGǰ BVEJUǰ GFFTǰ 5IFǰ ǰ $PNQBOZǰHJWFTǰEFUBJMTǰPOǰUIFǰOBNFTǰPGǰDFSUJųFEǰQVCMJDǰ accountants and their company to be the auditor, experiences and competence as well as independence ǰ PGǰUIFǰBVEJUPS ǰBOEǰRVBMJųDBUJPOTǰBDDFQUBCMFǰBTǰUIFǰ ǰ $PNQBOZĴTǰBVEJUPSǰBOEǰBQQSPWFEǰCZǰ4&$ǰ"VEJUǰGFFTǰ ǰ BOEPSǰPUIFSǰGFFTǰ JGǰBOZ ǰXJMMǰBMTPǰCFǰDMFBSMZǰJOEJDBUFEǰ so that shareholders can consider appropriateness before making decision. 1BZNFOUǰPGǰEJWJEFOETǰ5IFǰ$PNQBOZǰEJTDMPTFTǰJUTǰEJWJEFOEǰ payment policy, proposed payment rate and amount ǰ DPNQBSJOHǰUPǰOFUǰQSPųU ǰSFUBJOFEǰFBSOJOHTǰBOEǰFBSOJOHTǰQFSǰ share as well as payment rate of the previous year, together ǰ XJUIǰSFBTPOTǰBOEǰTVQQPSUJOHǰJOGPSNBUJPOǰ*OǰDBTFǰPGǰOPǰ dividend payment, clear reasons and supporting information will be given. 0UIFSǰNBUUFSTǰXJUIǰJNQBDUǰPOǰUIFǰ$PNQBOZ, such as determination and amendment of articles and memorandum of association, decrease or increase of ǰ DBQJUBM ǰBOEǰBQQSPWBMǰPGǰFYUSBǰJUFNT ǰFUDǰ5IFǰ$PNQBOZǰ will clearly indicate objectives, rationale, positive and ǰ OFHBUJWFǰ JGǰ BOZ ǰ JNQBDU ǰ BTǰ XFMMǰ BTǰ PQJOJPOTǰ PGǰ UIFǰ ǰ #PBSEǰPGǰ%JSFDUPSTǰGPSǰFBDIǰBHFOEBǰJUFN ǰ 'PSǰUIFǰǰ"OOVBMǰ(FOFSBMǰ.FFUJOHǰPGǰ4IBSFIPMEFST ǰ ǰ UIFǰ $PNQBOZǰ TFOUǰ Bǰ NFFUJOHǰ OPUJDFǰ PGǰ BUǰ MFBTUǰ ǰ month in advance to shareholders through various ǰ DIBOOFMT ǰOBNFMZ ǰUIFǰ$PNQBOZĴTǰXFCTJUF ǰ4&5ǰQPSUBMǰ ǰ BOEǰOPUJDFTǰPGǰTIBSFIPMEFSTĴǰNFFUJOHǰ5IFǰNFFUJOHǰOPUJDFǰ


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Ç° DPOUBJOFEÇ° BHFOEBÇ° JUFNT Ç° UIFÇ° #PBSEÄ´TÇ° PQJOJPOTÇ° XJUIÇ° other supporting documents such as facts, objectives, Ç° Ç° Ç° SFBTPOTÇ° PGÇ° UIFÇ° #PBSEÄ´TÇ° PQJOJPOT Ç° UIFÇ° $PNQBOZÄ´TÇ° Ç° Ç° Ç° "SUJDMFTÇ°PGÇ°"TTPDJBUJPOÇ°SFMFWBOUÇ°UPÇ°UIFÇ°NFFUJOHÇ°GPSÇ°UIFÇ° shareholders to consider in each agenda item, together Ç° Ç° Ç° XJUIÇ°UIFÇ°NJOVUFTÇ°PGÇ°UIFÇ°QSFWJPVTÇ°TIBSFIPMEFSTÄ´Ç°NFFUJOH Ç° containing the voting method, vote counts, list of all Ç° Ç° Ç° UIFÇ° EJSFDUPSTÇ° BUUFOEJOHÇ° UIFÇ° NFFUJOHÇ° JODMVEJOHÇ° UIFÇ° Ç° Ç° Ç° BCTFOUÇ° EJSFDUPST Ç° MJTUÇ° PGÇ° FYFDVUJWFTÇ° BUUFOEJOHÇ° UIFÇ° meeting, the voting inspector who was an outsider witnessing the vote count and the conduct of the meeting, questions from the shareholders and answers Ç° Ç° Ç° JOÇ°UIFÇ°NFFUJOH Ç°NFFUJOHÄ´TÇ°SFTPMVUJPOTÇ°XJUIÇ°UIFÇ°OVNCFSTÇ° Ç° Ç° Ç° PGÇ°WPUFTÇ°"HSFF Ç°%JTBHSFFÇ°BOEÇ°"CTUFOUJPOÇ°GPSÇ°FBDIÇ°BHFOEBÇ° item where voting was required. Ç°  Ç° 0OÇ°UIFÇ°EBUFÇ°PGÇ°UIFÇ°TIBSFIPMEFSTÄ´Ç°NFFUJOH 2Ç° 5IFÇ°$PNQBOZÇ°SFRVJSFTÇ°UIFÇ°NFFUJOHÇ°UPÇ°CFÇ°IFMEÇ°BDDPSEJOHÇ° to the laws and taking into account convenience as well as rights and equitable treatment of the shareholders. Ç° Ç° Ç° $PNQBOZÇ°TUBGGÇ°BSFÇ°UPÇ°QSPWJEFÇ°DPOWFOJFODFÇ°CZÇ°DIFDLJOHÇ° Ç° Ç° Ç° EPDVNFOUTÇ°PGÇ°UIFÇ°NFFUJOHÇ°BUUFOEFFTÇ°Ç°IPVSÇ°BOEÇ°BÇ° half before the meeting commencement, and barcodes are used to facilitate and expedite registration. Ç°Ç°Ç°Ç°Ç°Ç°Ç°Ç°Ç°Ç°Ç°Ç°Ç°Ç°Ç°Ç°Ç° "UÇ° FBDIÇ° TIBSFIPMEFSTÄ´Ç° NFFUJOH Ç° UIFÇ° $IBJSNBO Ç° UIFÇ° Ç° Ç° Ç° EJSFDUPST Ç°UIFÇ°(SPVQÇ°$IJFGÇ°&YFDVUJWFÇ°0GĹłDFS Ç°DIBJSNFOÇ° Ç° Ç° Ç° PGÇ°BMMÇ°4VCDPNNJUUFFT Ç°BOEÇ°UIFÇ°NBOBHFNFOUÇ°BUUFOEÇ° the meeting to allow shareholders to ask questions Ç° Ç° Ç° SFMBUJOHÇ°UPÇ°UIFÇ°$PNQBOZÇ°5IFÇ°BVEJUPSÇ°PGÇ°UIFÇ°$PNQBOZÇ° will perform as the inspector to ensure that the meeting is conducted with transparency, compliance to applicable laws, rules of related regulators, and the Ç° Ç° Ç° $PNQBOZÄ´TÇ°"SUJDMFTÇ°PGÇ°"TTPDJBUJPO 2Ç° #FGPSFÇ° UIFÇ° NFFUJOHÇ° DPNNFODFT Ç° UIFÇ° (SPVQÇ° $IJFGÇ° Ç° Ç° Ç° &YFDVUJWFÇ°0GĹłDFSÇ°XIPÇ°DIBJSTÇ°UIFÇ°NFFUJOHÇ°XJMMÇ°JOUSPEVDFÇ° Ç° Ç° Ç° UIFÇ° BUUFOEJOHÇ° #PBSEÇ° NFNCFST Ç° $IBJSNFOÇ° PGÇ° 4VC committees, the management, and the auditor of the Ç° Ç° Ç° $PNQBOZ Ç° UPÇ° UIFÇ° NFFUJOHÇ° BOEÇ° BTTJHOÇ° UIFÇ° $PNQBOZÇ° Secretary to proceed with the meeting. 2Ç° 5IFÇ°$PNQBOZÇ°4FDSFUBSZÇ°XJMMÇ°OPUJGZÇ°UIFÇ°NFFUJOHÇ°PGÇ°UIFÇ° quorum consisting of number of shareholders attending the meeting in person, number of shareholders attending by proxies, and number of shareholders authorizing independent directors as their proxies, with Ç° Ç° Ç° DMBSJĹłDBUJPOÇ°PGÇ°WPUJOHÇ°BOEÇ°WPUFÇ°DPVOUJOHÇ°NFUIPETÇ°UPÇ° the shareholders before the meeting commences. Ç° Ç° Ç° "DDPSEJOHÇ° UPÇ° UIFÇ° $PNQBOZÄ´TÇ° "SUJDMFTÇ° PGÇ° "TTPDJBUJPOÇ° Ç° Ç° Ç° BOEÇ°UIFÇ°1VCMJDÇ°-JNJUFEÇ°$PNQBOJFTÇ°"DU Ç°4FDUJPOÇ°Ç°  Ç° Ç° Ç° Ç° Ç° TIBSFÇ° JTÇ° FRVJWBMFOUÇ° UPÇ° Ç° WPUFÇ° *OÇ° UIFÇ° FWFOUÇ° PGÇ° BÇ° Ç° Ç° Ç° UJFÇ°PGÇ°WPUFT Ç°UIFÇ°$IBJSNBOÇ°XJMMÇ°IBWFÇ°UIFÇ°DBTUJOHÇ°WPUFÇ° Ç° Ç° Ç° 7PUJOHÇ°DPOEJUJPOÇ°GPSÇ°TIBSFIPMEFSTÇ°PSÇ°QSPYJFTÇ°JTÇ°BMTPÇ°CFÇ° explained. Ç° Ç° Ç° "UÇ°UIFÇ°Ç°"OOVBMÇ°(FOFSBMÇ°.FFUJOHÇ°PGÇ°4IBSFIPMEFSTÇ° Ç° Ç° Ç° IFMEÇ° POÇ° "QSJMÇ°  Ç°  Ç° UIFÇ° #PBSEÇ° PGÇ° %JSFDUPSTÇ° Ç° Ç° Ç° OPNJOBUFEÇ°Ç°JOEFQFOEFOUÇ°EJSFDUPSTÇ°UPÇ°CFÇ°QSPYZÇ°IPMEFSTÇ°

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BOEÇ° UIFSFÇ° XFSFÇ° Ç° TIBSFIPMEFSTÇ° IPMEJOHÇ° BÇ° UPUBMÇ° PGÇ°   Ç° TIBSFTÇ° BQQPJOUJOHÇ° *OEFQFOEFOUÇ° %JSFDUPSÇ° UPÇ°BUUFOEÇ°UIFÇ°NFFUJOHÇ°BOEÇ°WPUFÇ°POÇ°UIFJSÇ°CFIBMGÇ°5IFÇ° $PNQBOZÇ°IBTÇ°PQFOFEÇ°SFHJTUSBUJPOÇ°GPSÇ°Ç°IPVSTÇ°CFGPSFÇ° the Meeting. 5IFÇ°$PNQBOZÇ°4FDSFUBSZÇ°XPVMEÇ°DPOEVDUÇ°UIFÇ°NFFUJOHÇ°JOÇ° accordance with the sequence of agenda items given in UIFÇ°OPUJDFÇ°PGÇ°TIBSFIPMEFSTÄ´Ç°NFFUJOHÇ° FYDFQUÇ°UIBUÇ°UIFÇ° meeting resolves to change the sequence of agenda JUFNTÇ°JOÇ°BDDPSEBODFÇ°XJUIÇ°UIFÇ°QSPWJTJPOTÇ°PGÇ°UIFÇ°1VCMJDÇ° -JNJUFEÇ°$PNQBOJFTÇ°"DUÇ°UIBUÇ°SFRVJSFTÇ°UIFÇ°WPUFTÇ°PGÇ°BUÇ°MFBTUÇ° Ç° PGÇ° UIFÇ° TIBSFIPMEFSTÇ° BUUFOEJOHÇ° UIFÇ° NFFUJOH Ç° and for fairness to shareholders who do not attend the NFFUJOH Ç°OPÇ°PUIFSÇ°BHFOEBÇ°JUFNTÇ°OPUÇ°TQFDJĹłFEÇ°JOÇ°UIFÇ° OPUJDFÇ°PGÇ°TIBSFIPMEFSTÄ´Ç°NFFUJOHÇ°TIBMMÇ°CFÇ°BEEFEÇ°JOÇ°UIFÇ° agenda. However, to allow shareholders to exercise their rights under law, shareholders who hold a number PGÇ° TIBSFTÇ° DPNCJOFEÇ° OPUÇ° MFTTÇ° UIBOÇ° Ç° PGÇ° UIFÇ° UPUBMÇ° number of shares sold may ask the meeting to consider NBUUFSTÇ°PUIFSÇ°UIBOÇ°UIPTFÇ°TQFDJĹłFEÇ°JOÇ°UIFÇ°OPUJDFÇ°PGÇ° TIBSFIPMEFSTÄ´Ç°NFFUJOH 5IFÇ°#PBSEÇ°PGÇ°%JSFDUPSTÇ°IBTÇ°QSPWJEFEÇ°GPSÇ°UIFÇ°VTFÇ°PGÇ°CBMMPUÇ° UJDLFUTÇ°JOÇ°FWFSZÇ°BHFOEBÇ°JUFNÇ°UIBUÇ°SFRVJSFTÇ°WPUJOHÇ°5IJTÇ°JTÇ° for the purpose of transparency and auditability in case of an objection occurring thereafter, while votes are to be counted and the results thereof are disclosed, and UIFÇ°NFFUJOHÄ´TÇ°SFTPMVUJPOTÇ°BSFÇ°DMFBSMZÇ°SFDPSEFEÇ°JOÇ°UIFÇ° NFFUJOHÄ´TÇ°NJOVUFT 5IFÇ°$IBJSNBOÇ°BMMPDBUFTÇ°TVGĹłDJFOUÇ°UJNFÇ°BOEÇ°PQFOTÇ°UIFÇ° Ĺ´PPSÇ° UPÇ° UIFÇ° TIBSFIPMEFSTÇ° UPÇ° WPJDFÇ° UIFJSÇ° PQJOJPOT Ç° suggestions, and questions on each agenda item and SFHBSEJOHÇ°UIFÇ°PQFSBUJPOTÇ°PGÇ°UIFÇ°$PNQBOZÇ°*NQPSUBOUÇ° RVFSJFT Ç°DMBSJĹłDBUJPOT Ç°BOEÇ°PQJOJPOTÇ°TIBMMÇ°CFÇ°OPUFEÇ°JOÇ° the meeting minutes for acknowledgement by the shareholders who cannot attend the meeting. *OÇ° Ç°UIFÇ°$PNQBOZÇ°PSHBOJ[FEÇ°UIFÇ°BOOVBMÇ°HFOFSBMÇ° NFFUJOHÇ°PGÇ°TIBSFIPMEFSTÇ°POÇ°"QSJMÇ° Ç°Ç°BUÇ°Ç°QNÇ° BUÇ°UIFÇ°(SBOEÇ°.FFUJOHÇ°3PPN Ç°stÇ°'MPPS Ç°Ç°(..Ç°(SBNNZÇ° 1MBDF Ç° 4VLIVNWJUÇ° Ç° 3PBEÇ° "TPLF Ç° ,MPOHUPFJOVFB Ç° 8BUUBOB Ç° #BOHLPLÇ° "Ç° UPUBMÇ° PGÇ° Ç° EJSFDUPSTÇ° BUUFOEFEÇ° UIFÇ°NFFUJOH Ç°DPNQSJTJOHÇ°$IBJSNBOÇ°PGÇ°UIFÇ°#PBSE Ç°7JDFÇ° $IBJSNBOÇ°PGÇ°UIFÇ°#PBSE Ç°BOEÇ°$IBJSNFOÇ°PGÇ°4VCDPNNJUUFFT Ç° together with top management and representative from -FHBMÇ°%FQBSUNFOUÇ°"OEÇ°BVEJUPST Ç°XIFSFÇ°UIFSFÇ°XFSFÇ°Ç° EJSFDUPSTÇ° BCTFOUÇ° EVFÇ° UPÇ° BCSPBEÇ° CVTJOFTTÇ° USJQÇ° 5IFÇ° representative of external auditor would serve as the inspector to ensure the transparency, completely, laws BOEÇ°UIFÇ°$PNQBOZÄ´TÇ°"SUJDMFÇ°PGÇ°"TTPDJBUJPOÇ°DPNQMJBODFÇ° and in case of dispute arising in respect of examination and WPUJOHÇ°UISPVHIPVUÇ°UIFÇ°NFFUJOHÇ°5IFÇ°$IBJSNBOÇ°PGÇ°UIFÇ° NFFUJOHÇ°BQQPJOUFEÇ°UIFÇ°$PNQBOZÇ°4FDSFUBSZÇ°UPÇ°DPOEVDUÇ°UIFÇ° NFFUJOHÇ°5IFÇ°"OOVBMÇ°(FOFSBMÇ°.FFUJOHÇ°PGÇ°4IBSFIPMEFSTÇ° resolved to approve all the agenda items proposed.


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Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° 4. Ç°

ANNUAL REPORT 2013

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GMM GRAMMY

ǰ #FTJEFT ǰUIFǰ$PNQBOZǰJOǰǰIFMEǰBOǰFYUSBPSEJOBSZǰ general meeting of shareholders, aiming mainly to ǰ ǰ JODSFBTFǰUIFǰ$PNQBOZĴTǰSFHJTUFSFEǰDBQJUBMǰCZǰJTTVJOHǰBOEǰ ǰ ǰ PGGFSJOHǰOFXǰPSEJOBSZǰTIBSFTǰUPǰUIFǰ$PNQBOZĴTǰFYJTUJOHǰ shareholders according to the number of shares held ǰ ǰ BUǰ UIFǰ QSPQPSUJPOǰ PGǰ ǰ FYJTUJOHǰ PSEJOBSZǰ TIBSFTǰ UPǰ ǰ ǰ ǰ OFXǰPSEJOBSZǰTIBSFǰ5IFǰNFFUJOHǰXBTǰIFMEǰJOǰBDDPSEBODFǰ ǰ ǰ XJUIǰMBXT ǰUIFǰ$PNQBOZĴTǰ"SUJDMFTǰPGǰ"TTPDJBUJPOǰBOEǰ the principles of good corporate governance, with the shareholders approving every agenda item as proposed. ǰ ǰ "UǰUIFǰBOOVBMǰHFOFSBMǰNFFUJOHǰBOEǰUIFǰFYUSBPSEJOBSZǰ general meeting of shareholders, there were no agenda ǰ ǰ JUFNTǰPGǰPUIFSǰCVTJOFTTFTǰUIBUǰIBEǰOPUǰCFFOǰTQFDJųFEǰ in the meeting notice.  ǰ "GUFSǰUIFǰTIBSFIPMEFSTĴǰNFFUJOH  2ǰ 5IFǰ#PBSEǰPGǰ%JSFDUPSTǰBTTJHOTǰUIFǰ$PNQBOZǰ4FDSFUBSZǰ ǰ ǰ UPǰQSFQBSFǰNJOVUFTǰPGǰUIFǰTIBSFIPMEFSTĴǰNFFUJOHǰUPǰCFǰ ǰ ǰ DPNQMFUFǰBOEǰBDDVSBUFǰXJUIǰUIFǰGPMMPXJOHǰEFUBJMT ǰ ǰ /BNFTǰBOEǰQPTJUJPOTǰPGǰEJSFDUPST ǰNFNCFSTǰPGǰ4VC committees, top management, and auditor who attend ǰ ǰ PSǰBCTFOUǰBUǰUIFǰNFFUJOHǰ *GǰBOZ  ǰ ǰ 5IFǰNFFUJOHǰRVPSVNǰDPOTJTUJOHǰPGǰOVNCFSǰPGǰTIBSFIPMEFSTǰ who attend the meeting in person, number of shareholders by proxies, and number of shareholders authorizing independent directors as their proxies. ǰ ǰ .FUIPETǰPGǰWPUJOHǰPOǰFBDIǰBHFOEBǰJUFNǰBOEǰWPUFǰDPVOUJOHǰ before the meeting commences, and the way the ballot cards are used to count votes. ǰ ǰ 7PUFTǰXIJDIǰBQQSPWF ǰEJTBQQSPWF ǰBOEǰBCTUBJOǰPOǰBHFOEBǰ items which requires voting and identifying names and number of shares of persons who are not entitled to vote ǰ ǰ POǰFBDIǰBHFOEBǰJUFNǰ *GǰBOZ  ǰ ǰ ,FZǰRVFTUJPOT ǰDMBSJųDBUJPO ǰBOEǰPQJOJPOT 2ǰ 5IFǰ$PNQBOZǰXJMMǰBOOPVODFǰSFTPMVUJPOTǰPGǰUIFǰNFFUJOHǰ ǰ ǰ WJBǰUIFǰOFXTǰTZTUFNǰPGǰ4&5ǰCZǰUIFǰOFYUǰCVTJOFTTǰEBZǰ by identifying approval, disapproval, and abstention votes on each agenda item, and prepare meeting ǰ ǰ NJOVUFTǰJOǰCPUIǰ5IBJǰBOEǰ&OHMJTIǰBOEǰTVCNJUǰUIFNǰUPǰ ǰ ǰ 4&5ǰBOEǰSFMFWBOUǰBHFODJFTǰXJUIJOǰǰEBZTǰGSPNǰUIFǰEBUFǰ of the meeting, as well as disseminate the meeting ǰ ǰ NJOVUFTǰPOǰUIFǰ$PNQBOZĴTǰXFCTJUFǰTPǰUIBUǰTIBSFIPMEFSTǰ can inspect without waiting until the next meeting. ǰ ǰ 5IFSFǰJTǰBMTPǰBǰTPVOEǰEBUBCBTFǰXIFSFǰNFFUJOHǰNJOVUFTǰ ǰ ǰ BSFǰBWBJMBCMFǰGPSǰJOTQFDUJPOǰBOEǰSFGFSFODFǰ*OǰBEEJUJPO ǰ ǰ ǰ WJEFPǰ SFDPSEJOHǰ PGǰ "OOVBMǰ (FOFSBMǰ .FFUJOHǰ PGǰ Shareholders was prepared to be provided to interested ǰ ǰ TIBSFIPMEFSTǰJOǰGPSNǰPGǰ7$%ǰXIJDIǰXBTǰOPUJųFEǰUPǰUIFǰ ǰ ǰ TIBSFIPMEFSTǰWJBǰUIFǰOFXTǰTZTUFNǰPGǰUIFǰ4&5 Rights to appoint and remove directors and determine remuneration for directors  ǰ "QQPJOUNFOUǰPGǰEJSFDUPST 2ǰ 5IFǰ#PBSEǰPGǰ%JSFDUPSTǰHJWFTǰPQQPSUVOJUZǰUPǰTIBSFIPMEFSTǰ

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ǰ UPǰBQQPJOUǰEJSFDUPSTǰJOEJWJEVBMMZǰ5IFǰ/PNJOBUJPOǰBOEǰ ǰ 3FNVOFSBUJPOǰ$PNNJUUFFǰXJMMǰOPNJOBUFǰQFSTPOTǰUPǰCFǰ appointed as directors at the meeting and attach the ǰ ǰ TVNNBSJ[FEǰQSPųMFǰPGǰFBDIǰEJSFDUPSǰUPǰCFǰOPNJOBUFEǰ ǰ ǰ BTǰ XFMMǰ BTǰ JOGPSNBUJPOǰ XIJDIǰ JTǰ CFOFųDJBMǰ UPǰ UIFǰ shareholders for consideration. 2ǰ "DDPSEJOHǰUPǰUIFǰ"SUJDMFTǰPGǰ"TTPDJBUJPOǰPGǰUIFǰ$PNQBOZ ǰ ǰ ǰ BUǰ FWFSZǰ TIBSFIPMEFSTĴǰ NFFUJOH ǰ ǰ PGǰ UIFǰ UPUBMǰ ǰ ǰ EJSFDUPSTǰTIBMMǰWBDBUFǰUIFJSǰPGųDFǰXIFSFCZǰUIPTFǰXIPǰ ǰ ǰ SFNBJOǰJOǰUIFǰPGųDFǰUIFǰMPOHFTUǰTIBMMǰSFUJSFǰCZǰSPUBUJPOǰǰ ǰ ǰ *Gǰ UIFǰ OVNCFSǰ PGǰ EJSFDUPSTǰ JTǰ OPUǰ Bǰ NVMUJQMFǰ PGǰ  ǰ ǰ ǰ UIFǰOVNCFSǰPGǰEJSFDUPSTǰDMPTFTUǰUPǰǰTIBMMǰWBDBUFǰ ǰ ǰ UIFJSǰPGųDFǰ5IFǰSFUJSJOHǰEJSFDUPSǰJTǰFMJHJCMFǰGPSǰSFFMFDUJPOǰ ǰ ǰ 5IFǰ #PBSEǰ PGǰ %JSFDUPSTǰ BTTJHOTǰ UIFǰ /PNJOBUJPOǰ BOEǰ ǰ ǰ 3FNVOFSBUJPOǰ $PNNJUUFFǰ UPǰ TFUǰ HVJEFMJOFTǰ GPSǰ ǰ ǰ BQQPJOUNFOUǰPGǰEJSFDUPSTǰGPSǰTIBSFIPMEFSTǰBTǰGPMMPXT ǰ ǰ ǰTIBSFǰIFMEǰJTǰFRVJWBMFOUǰUPǰǰWPUF ǰ ǰ &BDIǰTIBSFIPMEFSǰNBZǰVTFǰBMMǰWPUFTǰJOǰDMBVTFǰǰUPǰFMFDUǰ ǰ ǰ ǰQFSTPOǰPSǰTFWFSBMǰQFSTPOTǰBTǰEJSFDUPSTǰCVUǰDBOOPUǰ divide the votes for any persons. ǰ ǰ 1FSTPOTǰ XIPǰ SFDFJWFǰ UIFǰ IJHIFTUǰ OVNCFSǰ PGǰ WPUFTǰ respectively shall be appointed as directors in the number of directors that have to be elected. ǰ ǰ *OǰDBTFǰQFSTPOTǰXIPǰIBWFǰCFFOǰFMFDUFEǰJOǰUIFǰGPMMPXJOHǰ order have equal votes which will make the number of directors elected exceeds the number required, the ǰ ǰ $IBJSNBOǰPGǰUIFǰNFFUJOHǰTIBMMǰIBWFǰUIFǰDBTUJOHǰWPUF  ǰ 3FNPWBMǰPGǰEJSFDUPST Removal of any director from the position before the end of the term shall be in accordance with laws and regulations ǰ PGǰ UIFǰ $PNQBOZǰ XJUIǰ UIFǰ WPUFTǰ PGǰ BUǰ MFBTUǰ ǰ PGǰ UIFǰ number of shareholders who attend the meeting and have the right to vote constituting the combined shares of not less than half of the shares held by the shareholders who attend the meeting and have the right to vote.  ǰ %FUFSNJOBUJPOǰPGǰSFNVOFSBUJPOǰGPSǰEJSFDUPST Shareholders have the right to consider remuneration for ǰ EJSFDUPSTǰ5IFǰ#PBSEǰPGǰ%JSFDUPSTǰBTTJHOTǰUIFǰ/PNJOBUJPOǰBOEǰ ǰ 3FNVOFSBUJPOǰ$PNNJUUFFǰUPǰQSPQPTFǰDSJUFSJBǰBOEǰQPMJDJFTǰ ǰ PGǰ EFUFSNJOBUJPOǰ PGǰ CPUIǰ NPOFUBSZǰ BOEǰ OPONPOFUBSZǰ ǰ SFNVOFSBUJPOǰGPSǰEJSFDUPSǰJOǰFBDIǰQPTJUJPOǰGPSǰTIBSFIPMEFSTĴǰ consideration and approval every year. ǰ *OǰBEEJUJPO ǰUIFǰ#PBSEǰPGǰ%JSFDUPSTǰIBTǰBTTJHOFEǰUIFǰ/PNJOBUJPOǰ ǰ BOEǰ 3FNVOFSBUJPOǰ $PNNJUUFFǰ UPǰ QSPQPTFǰ DSJUFSJBǰ BOEǰ ǰ QPMJDJFTǰ PGǰ EFUFSNJOBUJPOǰ PGǰ CPUIǰ NPOFUBSZǰ BOEPSǰ ǰ OPONPOFUBSZǰSFNVOFSBUJPOǰBOEǰSFNVOFSBUJPOǰPGǰ#PBSEǰ ǰ DPNNJUUFFTǰ JGǰBOZ ǰJOǰFBDIǰQPTJUJPOǰGPSǰBDLOPXMFEHFNFOUǰ of shareholders every year. Rights to approve appointment of auditor and determination of audit fees 5IFǰ #PBSEǰ PGǰ %JSFDUPSTǰ QSFTDSJCFTǰ UIBUǰ UIFǰ BQQPJOUNFOUǰ PGǰ auditors and determination of audit fees is subject to approval


165

by shareholders at the annual general meeting of shareholders FWFSZǰZFBSǰ5IFǰ$PNQBOZĴTǰBVEJUPSǰTIBMMǰCFǰJOEFQFOEFOUǰBOEǰ BQQSPWFEǰCZǰUIFǰ4&$ǰ5IFǰ$PNQBOZǰBUUBDIFTǰXJUIǰUIFǰNFFUJOHǰ JOWJUBUJPOǰOPUJDFǰBOEǰQPTUTǰPOǰUIFǰ$PNQBOZĴTǰXFCTJUFǰEFUBJMTǰ POǰ UIFǰ DFSUJųFEǰ QVCMJDǰ BDDPVOUBOUTǰ UPǰ CFǰ BQQPJOUFE ǰ UIFJSǰ company, experience and expertise, independence, number of ǰ ZFBSTǰVTFǰUPǰTFSWFǰBTǰBOǰBVEJUPSǰPGǰUIFǰ$PNQBOZǰ JOǰDBTFǰPGǰ ǰ CFJOHǰSFBQQPJOUFE ǰBOEǰBVEJUǰGFFTǰGPSǰBVEJUPSǰBOEPSǰPUIFSǰGFFTǰ ǰ JGǰBOZ ǰTPǰUIBUǰTIBSFIPMEFSTǰDBOǰDPOTJEFSǰBQQSPQSJBUFOFTTǰCFGPSFǰ making approval. ǰ 3JHIUTǰUPǰQSPųUǰTIBSJOH ǰ 5IFǰ#PBSEǰPGǰ%JSFDUPSTǰSFRVJSFTǰUIBUǰBQQSPQSJBUJPOǰPGǰQSPųUǰUPǰ shareholders in form of dividend shall be approved by shareholders at every annual general meeting of shareholders. ǰ *OǰBEEJUJPO ǰBDDPSEJOHǰUPǰUIFǰ1VCMJDǰ-JNJUFEǰ$PNQBOJFTǰ"DUǰBOEǰ ǰ UIFǰ "SUJDMFTǰ PGǰ "TTPDJBUJPOǰ PGǰ UIFǰ $PNQBOZ ǰ ĶUIFǰ #PBSEǰ PGǰ ǰ %JSFDUPSTǰNBZǰQBZǰJOUFSJNǰEJWJEFOEǰUPǰTIBSFIPMEFSTǰBUǰUJNFTǰ ǰ XIFOǰDPOTJEFSJOHǰUIBUǰUIFǰ$PNQBOZǰIBTǰTVGųDJFOUǰQSPųUTǰUPǰEPǰ ǰ TPǰBOEǰSFQPSUǰUPǰUIFǰTIBSFIPMEFSTǰBUǰUIFǰOFYUǰNFFUJOHķ ǰ )PXFWFS ǰ UIFǰ QBZNFOUǰ PGǰ EJWJEFOEǰ BOEPSǰ JOUFSJNǰ EJWJEFOEǰ depends on the investment plan and the business expansion ǰ QMBOǰPGǰUIFǰ$PNQBOZ ǰJUTǰųOBODJBMǰQPTJUJPOǰBOEǰPQFSBUJOHǰSFTVMUT ǰ as well as necessity and rationale thereof. ǰ 3JHIUTǰUPǰSFDFJWFǰOFXTǰBOEǰJOGPSNBUJPO ǰBOEǰBDDFTTǰPQFSBUJOHǰ results and management policies regularly and in a timely manner ǰ 5IFǰ#PBSEǰPGǰ%JSFDUPSTǰIBTǰBǰQPMJDZǰPGǰEJTDMPTVSFǰPGǰJOGPSNBUJPOǰ to shareholders transparently, accurately, and completely by not treating any group of shareholders unequally. Shareholders have the right to access and receive news and information, access ǰ PQFSBUJOHǰSFTVMUTǰBOEǰUIFǰNBOBHFNFOUǰQPMJDJFTǰPGǰUIFǰ$PNQBOZǰ ǰ TVGųDJFOUMZ ǰ SFHVMBSMZ ǰ UJNFMZ ǰ BOEǰ FRVBMMZǰ CZǰ DPOUBDUJOHǰ UIFǰ ǰ $PNQBOZǰPSǰSFDFJWJOHǰJOGPSNBUJPOǰWJBǰUIFǰGPMMPXJOHǰDIBOOFMT  2ǰ 5IFǰ4UPDLǰ&YDIBOHFǰPGǰ5IBJMBOEǰDIBOOFM 2ǰ 5IFǰ"OOVBMǰ3FHJTUSBUJPOǰ4UBUFNFOUǰ 'PSNǰ ǰBOEǰUIFǰ ǰ ǰ "OOVBMǰ3FQPSUǰ 'PSNǰ ǰPGǰUIFǰ$PNQBOZ 2ǰ 8FCTJUFǰ$PNQBOZǰǰIUUQXXXHNNHSBNNZDPN 2ǰ 0GųDFǰPGǰ$PSQPSBUFǰ4FDSFUBSZǰǰDT!HNNHSBNNZDPN 2ǰ *OWFTUPSǰ3FMBUJPOTǰǰJS!HNNHSBNNZDPN 2ǰ "OBMZTUǰNFFUJOH 2ǰ "OBMZTUǰ4JUFǰ7JTJU 2ǰ 4IBSFIPMEFSǰ4JUFǰ7JTJU 2ǰ 1SFTTǰDPOGFSFODF1SFTTǰ3FMFBTF 2ǰ "DUJWJUJFTǰIFMEǰCZǰUIFǰ4UPDLǰ&YDIBOHFǰPGǰ5IBJMBOE ǰFUD ǰ 0UIFSǰSJHIUTǰPGǰTIBSFIPMEFSTǰBTǰQSFTDSJCFEǰCZǰUIFǰ1VCMJDǰ ǰ -JNJUFEǰ$PNQBOJFTǰ"DU ǰUIFǰ4FDVSJUJFTǰBOEǰ&YDIBOHFǰ"DUǰPSǰ other relevant laws ǰ ǰ ǰ ǰ

Chapter 2 Equitable Treatment of Shareholders

5IFǰ#PBSEǰPGǰ%JSFDUPSTǰIBTǰBǰQPMJDZǰUPǰUSFBUǰBMMǰTIBSFIPMEFSTǰFRVJUBCMZǰ and fairly by protecting the rights of shareholders and provide convenience to shareholders in exercising of rights in various matters XIJDIǰTIBSFIPMEFSTǰBSFǰEFTFSWFEǰǰ5IFǰ#PBSEǰPGǰ%JSFDUPSTǰIBTǰBǰQPMJDZǰ PGǰFRVJUBCMFǰUSFBUNFOUǰPGǰTIBSFIPMEFSTǰBTǰGPMMPXT ǰ ǰ 5IFǰ#PBSEǰPGǰ%JSFDUPSTǰHJWFTǰUIFǰSJHIUTǰUPǰTIBSFIPMEFSTǰUPǰ ǰ ǰ DBTUǰǰWPUFǰQFSǰǰTIBSFǰǰ'PSǰUIFǰTBNFǰUZQFǰPGǰTIBSFT ǰ ǰ ǰ UIFZǰIBWFǰUIFǰSJHIUǰUPǰDBTUǰǰWPUFǰQFSǰǰTIBSF ǰ ǰ 5IFǰ#PBSEǰPGǰ%JSFDUPSTǰIBTǰBTTJHOFEǰUIFǰ$PNQBOZǰ4FDSFUBSZǰ ǰ ǰ UPǰ OPUJGZǰ TIBSFIPMEFSTǰ WJBǰ UIFǰ 4&5ǰ DIBOOFMǰ BOEǰ UIFǰ ǰ ǰ $PNQBOZĴTǰXFCTJUFǰBUǰMFBTUǰǰNPOUITǰCFGPSFǰUIFǰMBTUǰEBZǰ ǰ ǰ PGǰ UIFǰ ųTDBMǰ ZFBSǰ TPǰ UIBUǰ TIBSFIPMEFSTǰ XIPǰ IPMEǰ UIFǰ ǰ ǰ $PNQBOZĴTǰTIBSFTǰOPUǰMFTTǰUIBOǰǰPGǰJTTVFEǰBOEǰGVMMZǰ ǰ ǰ QBJEVQǰ TIBSFTǰ DBOǰ QSPQPTFǰ UIFǰ NFFUJOHǰ BHFOEBǰ JUFN ǰ nominte persons to assume the post of a director, and send ǰ ǰ RVFSJFTǰSFMBUJOHǰUPǰUIFǰ$PNQBOZǰJOǰBEWBODFǰQSJPSǰUPǰUIFǰ annual general meeting of shareholders. ǰ ǰ 5IFǰ$PNQBOZǰIBTǰBTTJHOFEǰ5IBJMBOEǰ4FDVSJUJFTǰ%FQPTJUPSZǰ ǰ ǰ $P ǰ-UEǰ 54% ǰBTǰJUTǰTFDVSJUJFTǰSFHJTUSBSǰUPǰTFOEǰUIFǰNFFUJOHǰ ǰ ǰ JOWJUBUJPOǰ OPUJDFǰ BOEǰ EPDVNFOUTǰ JOǰ &OHMJTIǰ JOǰ DBTFǰ ǰ ǰ TIBSFIPMEFSTǰBSFǰGPSFJHOFST ǰUPǰTIBSFIPMEFSTǰBUǰMFBTUǰǰ ǰ ǰ EBZTǰQSJPSǰUPǰUIFǰNFFUJOHǰEBUFǰ5IFǰ$PNQBOZǰBMTPǰQPTUTǰ ǰ ǰ UIFǰJOWJUBUJPOǰOPUJDFǰBOEǰBMMǰJOGPSNBUJPOǰ FYDMVEJOHǰBOOVBMǰ ǰ ǰ SFQPSU ǰ POǰ UIFǰ $PNQBOZĴTǰ XFCTJUFǰ JOǰ 5IBJǰ BOEǰ &OHMJTIǰ ǰ ǰ NPSFǰUIBOǰǰEBZTǰQSJPSǰUPǰUIFǰNFFUJOHǰTPǰUIBUǰTIBSFIPMEFSTǰ ǰ ǰ XJMMǰIBWFǰTVGųDJFOUǰUJNFǰUPǰUIPSPVHIMZǰTUVEZǰUIFǰNFFUJOHǰ ǰ ǰ JOGPSNBUJPOǰ GPSǰ EFDJTJPONBLJOHǰ CFGPSFǰ SFDFJWJOHǰ ǰ ǰ EPDVNFOUTǰGSPNǰUIFǰ$PNQBOZ ǰ ǰ 5IFǰ #PBSEǰ PGǰ %JSFDUPSTǰ QSPWJEFTǰ DPOWFOJFODFǰ UPǰ shareholders who cannot attend the meeting in person ǰ ǰ CZǰTFOEJOHǰUIFNǰ1SPYZǰ'PSNǰ5ZQFǰ" ǰ#ǰBOEǰ$ǰBOEǰBUUBDIǰ ǰ ǰ EPDVNFOUTǰ BOEǰ TJNQMFǰ QSPYZHJWJOHǰ JOTUSVDUJPOǰ TPǰ UIBUǰ ǰ ǰ TIBSFIPMEFSTǰDBOǰCFǰXFMMQSFQBSFEǰBOEǰOPǰQSPCMFNǰPGǰ ǰ ǰ BUUFOEBODFǰPGǰQSPYJFTǰXJMMǰPDDVSǰ*OǰBEEJUJPO ǰTIBSFIPMEFSTǰDBOǰ ǰ ǰ BMTPǰEPXOMPBEǰUIFǰQSPYZǰGPSNǰGSPNǰUIFǰDPNQBOZĴTǰXFCTJUF ǰ ǰ 5IFǰ#PBSEǰPGǰ%JSFDUPSTǰOPNJOBUFTǰBUǰMFBTUǰǰJOEFQFOEFOUǰ ǰ ǰ EJSFDUPSǰ PGǰ UIFǰ $PNQBOZǰ BTǰ BOǰ PQUJPOǰ PGǰ QSPYZǰ GPSǰ ǰ ǰ TIBSFIPMEFSTǰ 5IFǰ $PNQBOZǰ XJMMǰ BUUBDIǰ UIFǰ OBNFǰ BOEǰ ǰ ǰ QSPųMFǰPGǰJOEFQFOEFOUǰEJSFDUPSǰXJUIǰUIFǰNFFUJOHǰJOWJUBUJPOǰ notice. ǰ ǰ 5IFǰ#PBSEǰPGǰ%JSFDUPSTǰDPOEVDUTǰUIFǰNFFUJOHǰBDDPSEJOHǰUPǰ the agenda order outlined in the meeting invitation notice and will not add any meeting agenda item without notifying ǰ ǰ TIBSFIPMEFSTǰJOǰBEWBODFǰBQBSUǰGSPNǰUIPTFǰTQFDJųFEǰJOǰUIFǰ invitation letter. ǰ ǰ "Uǰ UIFǰ NFFUJOHǰ PGǰ TIBSFIPMEFST ǰ UIFǰ NFFUJOHǰ XJMMǰ CFǰ ǰ ǰ DPOEVDUFEǰBDDPSEJOHǰUPǰUIFǰBHFOEBǰPSEFSǰOPUJųFEǰJOǰUIFǰ meeting invitation notice without adding any agenda items ǰ ǰ XIJDIǰIBWFǰOPUǰCFFOǰOPUJųFEǰJOǰUIFǰNFFUJOHǰJOWJUBUJPOǰ notice so as to be fair to shareholders who cannot attend the meeting.


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ANNUAL REPORT 2013

GMM GRAMMY

ǰ 5IFǰ #PBSEǰ PGǰ %JSFDUPSTǰ BSSBOHFTǰ GPSǰ VTFǰ PGǰ CBMMPUTǰ BOEǰ ǰ RVBMJųFEǰWPUFǰQSPDFTTJOHǰQSPHSBNǰPOǰFWFSZǰBHFOEBǰJUFNǰ which requires vote casting for transparency and inspection ǰ DBOǰCFǰNBEFǰJOǰDBTFǰEFCBUFTǰPDDVSǰMBUFSǰPOǰ"MTP ǰBOǰ inspector is prepared for counting of votes and the vote results and resolutions of the meeting shall be disclosed clearly in the meeting minutes. ǰ 5IFǰ #PBSEǰ PGǰ %JSFDUPSTǰ TFUTǰ Bǰ QPMJDZǰ PGǰ QSFWFOUJPOǰ PGǰ ǰ DPOŴJDUTǰPGǰJOUFSFTUǰBOEǰJOTJEFSǰUSBEJOHǰUPǰTFFLǰJOUFSFTUǰ ǰ GPSǰPOFTFMGǰPSǰPUIFSTǰJOǰVOEVFǰNBOOFSǰJOǰUIFǰ$PSQPSBUFǰ ǰ (PWFSOBODFǰBOEǰ#VTJOFTTǰ&UIJDTǰ.BOVBMǰPGǰUIFǰ$PNQBOZǰ and disseminates the policy to all directors, executives, ǰ BOEǰFNQMPZFFTǰPGǰUIFǰ$PNQBOZǰGPSǰBDLOPXMFEHFNFOUǰBOEǰ strict compliance to prevent directors and executives of ǰ UIFǰ$PNQBOZǰGSPNǰUSBEJOHǰUIFǰ$PNQBOZĴTǰTIBSFTǰCZǰVTJOHǰ internal information or undertaking related party transactions and selling or buying assets in a manner which breaches or ǰ EPFTǰOPUǰDPNQMZǰXJUIǰHVJEFMJOFTǰPGǰ4&5ǰBOEǰ4&$ ǰ *OǰDBTFǰPGǰVOEFSUBLJOHǰSFMBUFEǰQBSUZǰUSBOTBDUJPOTǰXIJDIǰ are required to be disclosed or to seek approval from ǰ TIBSFIPMEFSTǰBDDPSEJOHǰUPǰSFRVJSFNFOUTǰPGǰUIFǰ4&5 ǰQSJPSǰ ǰ UPǰ VOEFSUBLJOHǰ PGǰ UIFǰ USBOTBDUJPO ǰ UIFǰ $PNQBOZǰ IBTǰ disclosed details such as name and relation of related parties, policy of determination of value of the transaction, rationale, ǰ BTǰXFMMǰBTǰPQJOJPOTǰPOǰUIFǰUSBOTBDUJPOǰPGǰUIFǰ"VEJUǰ$PNNJUUFFǰ ǰ BOEǰUIFǰ#PBSEǰPGǰ%JSFDUPSTǰUPǰTIBSFIPMEFSTǰDMFBSMZǰUIBUǰUIFǰ related party transactions are fairly undertaken at market prices and based on normal business practices. ǰ 5IFǰ#PBSEǰPGǰ%JSFDUPSTǰSFRVJSFTǰEJSFDUPSTǰBOEǰFYFDVUJWFTǰ ǰ BDDPSEJOHǰUPǰEFųOJUJPOTǰPGǰ4&$ǰBOEǰ4&5 ǰUPǰDPNQMZǰXJUIǰ ǰ 4FDUJPOǰǰPGǰUIFǰ4FDVSJUJFTǰBOEǰ&YDIBOHFǰ"DUǰCZǰSFQPSUJOHǰ ǰ UIFJSǰ JOUFSFTUǰ BOEǰ UIFJSǰ SFMBUFEǰ QFSTPOTĴǰ JODMVEJOHǰ ǰ XIFOFWFSǰUIFSFǰJTǰDIBOHFǰUPǰJOGPSNBUJPO ǰCZǰBTTJHOJOHǰUIFǰ ǰ $PNQBOZǰ 4FDSFUBSZǰ UPǰ SFQPSUǰ JOUFSFTUǰ JOGPSNBUJPOǰ ǰ JODMVEJOHǰDIBOHFT ǰUPǰUIFǰNFFUJOHǰPGǰUIFǰ#PBSEǰPGǰ%JSFDUPSTǰ for acknowledgement every 6 months to consider ǰ USBOTBDUJPOTǰPGǰUIFǰ$PNQBOZǰXIJDIǰNBZǰIBWFǰDPOŴJDUTǰPGǰ ǰ JOUFSFTUǰXJUIǰUIFǰ$PNQBOZǰ%JSFDUPSTǰBOEǰFYFDVUJWFTǰXIPǰ have any related interest shall not attend the meeting to express opinions and have no rights to make a resolution of such matter. ǰ 5IFǰ#PBSEǰPGǰ%JSFDUPSTǰSFRVJSFTǰEJSFDUPSTǰBOEǰFYFDVUJWFTǰ ǰ BDDPSEJOHǰUPǰEFųOJUJPOTǰPGǰUIFǰ4&$ǰBOEǰ4&5 ǰUPǰSFQPSUǰPOǰ ǰ EFBMJOHǰPGǰUIFǰDPNQBOZĴTǰTFDVSJUJFTǰBUǰMFBTUǰǰEBZǰCFGPSFǰ ǰ FYFDVUJOHǰ UIFǰ USBOTBDUJPOǰ UISPVHIǰ 0GųDFǰ PGǰ $PSQPSBUFǰ Secretary

Connected Transactions 5IFǰ#PBSEǰPGǰ%JSFDUPSTǰJTǰBXBSFǰPGǰUIFǰJNQPSUBODFǰPGǰDPOEVDUJOHǰJUTǰ business with transparency and with due consideration of its TUBLFIPMEFSTǰ "Tǰ TVDI ǰ UIFǰ DPSQPSBUFǰ HPWFSOBODFǰ QPMJDZǰ PGǰ UIFǰ $PNQBOZǰ IBTǰ DMFBSMZǰ TQFDJųFEǰ UIBUǰ BMMǰ DPOOFDUFEǰ USBOTBDUJPOTǰ PGǰ UIFǰ$PNQBOZǰBOEǰTVCTJEJBSJFTǰNVTUǰCF ǰBUǰUIFǰNJOJNVN ǰBQQSPWFEǰ CZǰUIFǰNBOBHFNFOUǰPGǰUIFǰ$PNQBOZǰ*GǰFOUFSJOHǰJOUPǰBOZǰDPOOFDUFEǰ

USBOTBDUJPOTǰ XIJDIǰ GBMMǰ VOEFSǰ UIFǰ DSJUFSJBǰ TUJQVMBUFEǰ CZǰ UIFǰ 4&5ǰ regarding disclosure of information and acts of listed companies POǰ DPOOFDUFEǰ USBOTBDUJPOTǰ BOEPSǰ JGǰ FOUFSJOHǰ JOUPǰ USBOTBDUJPOTǰ PGǰ BDRVJTJUJPOǰPSǰEJTQPTBMǰPGǰBTTFUTǰPGǰMJTUFEǰDPNQBOJFT ǰUIFǰ$PNQBOZǰ TIBMMǰQFSGPSNǰQVSTVBOUǰUPǰUIFǰ4&5ǰDSJUFSJBǰBOEǰSFHVMBUJPOTǰSFRVJSJOHǰ UIBUǰTVDIǰUSBOTBDUJPOTǰBSFǰTVCKFDUǰUPǰFOEPSTFNFOUǰBOEPSǰBQQSPWBMǰ CZǰUIFǰNBOBHFNFOUǰBOEPSǰUIFǰ#PBSEǰPGǰ%JSFDUPSTĴǰNFFUJOHǰBOEPSǰ UIFǰTIBSFIPMEFSTĴǰNFFUJOH ǰBTǰUIFǰDBTFǰNBZǰCF ǰPOǰXIJDIǰSFMBUFEǰ parties will not be entitled to vote. 5PǰQSFWFOUǰDPOŴJDUTǰPGǰJOUFSFTU ǰUIFǰ#PBSEǰPGǰ%JSFDUPSTǰJTǰQSVEFOUǰJOǰ DPOTJEFSJOHǰBOZǰUSBOTBDUJPOTǰQSPOFǰUPǰBǰDPOŴJDUǰPGǰJOUFSFTUǰCZǰNBQQJOHǰ written policy and procedure on approval of connected transactions JOǰUIFǰ$PSQPSBUFǰ"VUIPSJ[BUJPOǰ*OEFYǰ $"* ǰBOEPSǰSFRVFTUJOHǰBQQSPWBMǰ GSPNǰUIFǰTIBSFIPMEFSTǰBDDPSEJOHǰUPǰUIFǰ4&5ǰDSJUFSJBǰBOEǰSFHVMBUJPOTǰǰ 1VSTVBOUǰUPǰUIFǰ4&5ǰDSJUFSJB ǰQSJDFTǰBOEǰDPOEJUJPOTǰQFSUBJOJOHǰUPǰTVDIǰ USBOTBDUJPOTǰIBWFǰUPǰCFǰDPOEVDUFEǰPOǰBOǰBSNĴTǰMFOHUIǰCBTJTǰǰ5IFǰ"VEJUǰ $PNNJUUFFǰXJMMǰTVCNJUǰUIFǰUSBOTBDUJPOTǰXJUIǰDPOŴJDUTǰPGǰJOUFSFTUǰBOEǰ UIFǰDPOOFDUFEǰUSBOTBDUJPOTǰUPǰUIFǰ#PBSEǰPGǰ%JSFDUPSTǰPOǰBǰSFHVMBSǰCBTJTǰ 5IFǰ$PNQBOZǰBOEǰTVCTJEJBSJFTǰIBWFǰOPǰQPMJDZǰUPǰNBLFǰBOZǰDPOOFDUFEǰ USBOTBDUJPOTǰVOMFTTǰUIFǰ$PNQBOZǰWJFXTǰUIBUǰUIFǰUSBOTBDUJPOǰXJMMǰZJFMEǰ the highest returns, at the price and under the terms and conditions as HFOFSBMMZǰFYFDVUFEǰXJUIǰPVUTJEFǰQBSUJFTǰǰ5IFǰ$PNQBOZǰIBTǰTFUǰGPSǰTVDIǰ USBOTBDUJPOTǰUPǰCFǰBQQSPWFEǰCZǰUIFǰNBOBHFNFOUǰBOEPSǰUIFǰ#PBSEǰ PGǰ%JSFDUPSTǰBOEPSǰUIFǰNFFUJOHǰPGǰTIBSFIPMEFSTǰBTǰUIFǰDBTFǰNBZǰCF *OǰVOEFSUBLJOHǰSFMBUFEǰQBSUZǰUSBOTBDUJPOTǰJOǰGPSNǰPGǰųOBODJBMǰBTTJTUBODF ǰ UIFǰ#PBSEǰPGǰ%JSFDUPSTǰIBTǰTFUǰHVJEFMJOFTǰGPSǰUIJTǰUZQFǰPGǰUSBOTBDUJPOǰ JOǰUIFǰ"VUIPSJ[BUJPOǰBOEǰ1SPDFEVSFǰ.BOVBMǰBQQSPWFEǰCZǰUIFǰ#PBSEǰ PGǰ%JSFDUPSTǰBTǰGPMMPXT ǰ *OǰDBTFǰXIFSFǰųOBODJBMǰBTTJTUBODFǰJTǰQSPWJEFEǰUPǰPSǰSFDFJWFEǰGSPNǰ a connected person that is an individual or juristic person, in ǰ XIJDIǰUIFǰ$PNQBOZǰPSǰJUTǰTVCTJEJBSJFTǰPXOTǰTIBSFTǰJOǰBǰQSPQPSUJPOǰ lower than the portion of shares held in that company by other connected person, the transaction shall be subject to approval ǰ CZǰUIFǰ(SPVQǰ$IJFGǰ&YFDVUJWFǰ0GųDFS ǰ 'JOBODJBMǰBTTJTUBODFǰQSPWJTJPOǰPSǰSFDFJQUǰUSBOTBDUJPOTǰPUIFSǰUIBOǰ ǰ UIBUǰNFOUJPOFEǰJOǰ*UFNǰǰBCPWFǰTIBMMǰCFǰTVCKFDUǰUPǰDPOTJEFSBUJPOǰ ǰ BOEǰBQQSPWBMǰCZǰUIFǰ$IJFGǰ&YFDVUJWFǰ0GųDFSǰ VQǰUPǰ  ǰ ǰ CBIU ǰPSǰUIFǰ(SPVQǰ$IJFGǰ&YFDVUJWFǰ0GųDFS ǰ *OǰBEEJUJPO ǰUIFǰ#PBSEǰPGǰ%JSFDUPSTǰSFDPHOJ[FTǰUIFǰJNQPSUBODFǰPGǰ ǰ QSFWFOUJPOǰPGǰDPOŴJDUTǰPGǰJOUFSFTUǰTPǰJUǰIBTǰTFUǰUPǰIBWFǰEJTDMPTVSFǰ of information and transparency relating to undertaking of ǰ DPOOFDUFEǰUSBOTBDUJPOTǰBOEǰQSFWFOUJPOǰPGǰQPTTJCMFǰDPOŴJDUTǰPGǰ interest by having various relevant reports made available, such as preparation of report on disclosure of transactions prone ǰ UPǰDPOŴJDUTǰPGǰJOUFSFTUǰBOEPSǰSFMBUFEǰQBSUZǰUSBOTBDUJPOT ǰSFQPSUǰ on securities holding and changes in securities holding, and report on vested interst of directors, executives, and related persons thereof. ǰ *Oǰ ǰUIFǰ$PNQBOZǰEJEǰOPUIJOHǰJOǰWJPMBUJPOǰPGǰPSǰBHBJOTUǰUIFǰ ǰ SFRVJSFNFOUTǰ PGǰ UIFǰ 4&$ǰ BOEǰ 4&5 ǰ XIFUIFSǰ JOTJEFSǰ USBEJOH ǰ connected transactions or asset trading.


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Chapter 3 Consideration of the Roles of Stakeholders 5IFÇ°#PBSEÇ°PGÇ°%JSFDUPSTÇ°CFMJFWFTÇ°JOÇ°DPOEVDUJOHÇ°CVTJOFTTÇ°XJUIÇ°JOUFHSJUZÇ° and transparency as well as having roles and responsibilities toward society by giving importance to the rights of all stakeholders of the $PNQBOZ Ç°FJUIFSÇ°JOUFSOBMÇ°TUBLFIPMEFSTÇ°TVDIÇ°BTÇ°EJSFDUPST Ç°FNQMPZFFT Ç° BOEÇ°FYFDVUJWFTÇ°PGÇ°UIFÇ°$PNQBOZ Ç°PSÇ°FYUFSOBMÇ°TUBLFIPMEFSTÇ°TVDIÇ°BTÇ° shareholders, customers, trade partners, competitors, the society and the environment, public sector, and relevant agencies appropriately GPSÇ°CPUIÇ°SJHIUTÇ°SFRVJSFEÇ°CZÇ°MBXTÇ°PSÇ°UIPTFÇ°KPJOUMZÇ°BHSFFEÇ°VQPOÇ°5IFÇ° #PBSEÇ°PGÇ°%JSFDUPSTÇ°IBTÇ°TFUÇ°HVJEFMJOFTÇ°GPSÇ°EJSFDUPST Ç°FYFDVUJWFT Ç°BOEÇ° FNQMPZFFTÇ°JOÇ°UIFÇ°(3"..:Ç°(SPVQÄ´TÇ°CVTJOFTTÇ°FUIJDTÇ°UPÇ°CFÇ°USBOTQBSFOUÇ° BOEÇ°GBJSÇ°UPÇ°WBSJPVTÇ°TUBLFIPMEFST Ç°EFUBJMTÇ°PGÇ°XIJDIÇ°BSFÇ°BTÇ°GPMMPXT

Ethics on Treatment of Shareholders 5IFǰ#PBSEǰPGǰ%JSFDUPSTǰIBTǰBǰQPMJDZǰBOEǰHVJEFMJOFTǰPOǰFRVJUBCMFǰBOEǰ GBJSǰUSFBUNFOUǰPGǰTIBSFIPMEFSTǰBTǰGPMMPXT ǰ 1FSGPSNJOHǰ EVUJFTǰ BOEǰ DPOEVDUJOHǰ CVTJOFTTǰ XJUIǰ JOUFHSJUZ ǰ transparency, and accountability to shareholders on a regular basis and disclose accurate, complete and standard information to shareholders within the legal framework, business ethics, and good corporate governance principles. ǰ .BOBHJOHǰCVTJOFTTǰPGǰUIFǰ$PNQBOZǰGPSǰTUBCMFǰQSPHSFTTǰCZǰVTJOHǰ knowledge, competence, and experience to the full extent and make any decisions with integrity, honesty, care, and justice ǰ GPSǰUIFǰIJHIFTUǰCFOFųUTǰPGǰUIFǰTIBSFIPMEFST ǰ 4VQFSWJTJOHǰ PQFSBUJPOTǰ UPǰ FOTVSFǰ UIBUǰ UIFǰ $PNQBOZǰ IBTǰ ǰ BQQSPQSJBUFǰųOBODJBMǰTUBUVTǰBOEǰNBOBHFNFOUǰUPǰQSPUFDUǰBOEǰ increase interests of shareholders. ǰ .BOBHJOHǰBTTFUTǰPGǰUIFǰ$PNQBOZǰOPUǰUPǰEFUFSJPSBUF ǰMPTF ǰPSǰXBTUF ǰ /PUǰTFFLJOHǰCFOFųUTǰGPSǰPOFTFMGǰBOEǰSFMBUFEǰQFSTPOTǰCZǰEJTDMPTJOHǰ ǰ JOUFSOBMǰ JOGPSNBUJPOǰ PGǰ UIFǰ $PNQBOZǰ XIJDIǰ JTǰ DPOųEFOUJBMǰ ǰ BOEPSǰOPUǰZFUǰEJTDMPTFEǰUPǰUIFǰQVCMJDǰPSǰPVUTJEFSTǰXIJDIǰNBZǰ ǰ DBVTFǰEBNBHFǰUPǰUIFǰ$PNQBOZ 6. Respecting the rights of shareholders by reporting status and ǰ PQFSBUJOHǰSFTVMUTǰPGǰUIFǰ$PNQBOZǰBTǰXFMMǰBTǰJOGPSNBUJPOǰUPǰBMMǰ shareholders equally, regularly, timely, accurately, completely, ǰ BOEǰGBDUVBMMZǰCZǰIBWJOHǰTVGųDJFOUǰTVQQPSUJOHǰEPDVNFOUTǰBOEǰ ǰ JOǰBDDPSEBODFǰXJUIǰUIFǰSFRVJSFNFOUTǰPGǰUIFǰ4&5ǰBOEǰUIFǰ4&$ ǰ /PUǰQFSGPSNJOHǰBOZǰBDUTǰJOǰBǰNBOOFSǰXIJDIǰNBZǰDBVTFǰDPOŴJDUTǰ ǰ PGǰJOUFSFTUǰUPǰUIFǰ$PNQBOZǰXJUIPVUǰOPUJGZJOHǰUIFǰ$PNQBOZ

ǰ 4UVEZJOH ǰBTTFTTJOH ǰBOEǰJNQSPWJOHǰJNQBDUǰPGǰQSPEVDUTǰBOEPSǰ services which may occur to consumers consistently, and monitor and supervise products and services to have quality and meet standards, requirements, consumer protection laws or other relevant laws. ǰ 1SPWJEJOHǰJOGPSNBUJPOǰXIJDIǰJTǰBDDVSBUF ǰTVGųDJFOU ǰBOEǰCFOFųDJBMǰ ǰ UPǰQSPEVDUǰBOEPSǰTFSWJDFǰDPOTVNFSTǰGPSǰEFDJTJPONBLJOHǰCZǰOPUǰ intending to cover information or giving false information to ǰ NJTMFBEǰQSPEVDUǰBOEPSǰTFSWJDFǰDPOTVNFSTǰBCPVUǰUIFǰRVBMJUZ ǰ quantity, or conditions of the product or service. ǰ 3FTQFDUJOHǰUIFǰSJHIUTǰPGǰUIFǰQSPEVDUǰBOEPSǰTFSWJDFǰDPOTVNFSTǰ and protect their personal information by not disclosing their personal information without their prior consent or using such ǰ JOGPSNBUJPOǰUPǰTFFLǰCFOFųUTǰFYDFQUǰGPSǰJOGPSNBUJPOǰXIJDIǰNVTUǰ be disclosed to the public as required by laws. ǰ "SSBOHJOHǰGPSǰBǰQSPDFEVSFǰUPǰXIJDIǰDVTUPNFSTǰDBOǰųMFǰJTTVFTǰPGǰ problems of using products or inappropriate provision of services ǰ WJBǰFMFDUSPOJDǰNBJMǰPSǰDBMMǰDFOUFSǰTPǰUIBUǰUIFǰ$PNQBOZǰDBOǰQSFWFOU resolve problems for the customers quickly and appropriately and use such information to improve or develop other products or services. ǰ $POUSBDUTǰCFUXFFOǰUIFǰ$PNQBOZǰBOEǰDVTUPNFSTǰBOEǰDPOTVNFSTǰ ǰ PGǰUIFǰ$PNQBOZǰNVTUǰCFǰXSJUUFOǰDMFBSMZǰBOEǰFBTZǰUPǰVOEFSTUBOEǰ and comprising information and agreements which are accurate ǰ BOEǰTVGųDJFOUǰBOEǰEPǰOPUǰDPOUBJOǰBOZǰDPOEJUJPOTǰXIJDIǰBSFǰOPUǰ ǰ GBJSǰ PSǰ CSFBDIǰ UIFǰ SJHIUTǰ PGǰ DVTUPNFSTǰ BOEǰ DPOTVNFSTǰ "MTP ǰ contracts and conditions mutually agreed upon shall be complied with in a strict manner and in case of failure to comply ǰ XJUIǰBOZǰDPOEJUJPO ǰDVTUPNFSTǰTIBMMǰCFǰOPUJųFEǰJNNFEJBUFMZǰUPǰ help seek resolution on a rationality basis. 7. Supporting activities which promote and maintain good ǰ SFMBUJPOTIJQǰCFUXFFOǰDVTUPNFSTǰBOEǰUIFǰ$PNQBOZ

Ethics on Treatment of Competitors

5IFǰ#PBSEǰPGǰ%JSFDUPSTǰDPOEVDUTǰCVTJOFTTǰXJUIJOǰBǰGSBNFXPSLǰPGǰGSFFǰ BOEǰ GBJSǰ DPNQFUJUJPOǰ 1PMJDZǰ BOEǰ (VJEFMJOFTǰ GPSǰ USFBUNFOUǰ UPXBSEǰ DPNQFUJUPSTǰBSFǰBTǰGPMMPXT ǰ 5SFBUJOHǰDPNQFUJUPSTǰBDDPSEJOHǰUPǰUIFǰSVMFǰBOEǰNBOOFSǰPGǰHPPEǰ and fair competition. ǰ /PUǰ TFFLJOHǰ DPOųEFOUJBMǰ JOGPSNBUJPOǰ PGǰ DPNQFUJUPSTǰ XJUIǰ fraudulent, dishonest, or inappropriate method or in breach of laws. ǰ /PUǰ JOUFOUJPOBMMZǰ EFTUSPZJOHǰ SFQVUBUJPOǰ PGǰ DPNQFUJUPSTǰ XJUIǰ Ethics on Treatment of Customers and Consumers groundless slander. 5IFǰ#PBSEǰPGǰ%JSFDUPSTǰJTǰDPNNJUUFEǰUPǰDSFBUJOHǰBOEǰQSPEVDJOHǰBMMǰ forms of media and entertainment to bring satisfaction to customers ǰ /PUǰQFSGPSNJOHǰBOZǰBDUTǰXIJDIǰCSFBDIǰJOUFMMFDUVBMǰQSPQFSUZǰBOEǰ DPOUJOVPVTMZǰǰ1PMJDZǰBOEǰ(VJEFMJOFTǰGPSǰUSFBUNFOUǰUPXBSETǰDVTUPNFSTǰ copyright of competitors. BOEǰDPOTVNFSTǰBSFǰBTǰGPMMPXT Ethics on Treatment of Trade Partners ǰ $BUFSJOHǰUPǰUIFǰOFFETǰPGǰDVTUPNFSTǰXJUIǰHPPEǰRVBMJUZǰPGǰQSPEVDUTǰ ǰ BOEǰTFSWJDFTǰBUǰSFBTPOBCMFǰQSJDFTǰBOEǰXJUIǰRVBMJųFEǰFNQMPZFFTǰ 5IFǰ#PBSEǰPGǰ%JSFDUPSǰUSFBUTǰDVTUPNFSTǰFRVBMMZǰBOEǰCBTFEǰPOǰNVUVBMǰ CFOFųUTǰ1PMJDZǰBOEǰ(VJEFMJOFTǰGPSǰUSFBUNFOUǰUPXBSEǰUSBEJOHǰQBSUOFSTǰ ǰ BOEǰTUBUFPGUIFBSUǰJOOPWBUJPOǰBOEǰUFDIOPMPHZ BSFǰBTǰGPMMPXTǰ


168

ANNUAL REPORT 2013

GMM GRAMMY

ǰ 5SFBUJOHǰUSBEFǰQBSUOFSTǰFRVBMMZ ǰGBJSMZ ǰBOEǰCBTFEǰPOǰGBJSǰSFUVSOTǰ acceptable to both parties. ǰ $PNQMZJOHǰ XJUIǰ BHSFFNFOUTǰ PSǰ DPOEJUJPOTǰ NVUVBMMZǰ BHSFFEǰ ǰ VQPOǰTUSJDUMZǰBOEǰJOǰDBTFǰPGǰOPODPNQMJBODFǰXJUIǰBOZǰDPOEJUJPOT ǰ notify customers immediately to jointly seek solutions on a rationality basis. ǰ /PUǰBTLJOHǰGPSǰPSǰBDDFQUJOHǰBTTFUTǰPSǰPUIFSǰCFOFųUTǰXIJDIǰBSFǰ dishonest to trading with trade partners. ǰ *OǰDBTFǰUIFSFǰBSFǰHSPVOETǰUPǰCFMJFWFǰUIBUǰUIFSFǰJTǰSFRVFTUǰPSǰ ǰ BDDFQUBODFǰ PGǰ BTTFUTǰ PSǰ PUIFSǰ CFOFųUTǰ XIJDIǰ BSFǰ VOEVF ǰ information shall be disclosed to trade partners to jointly seek solutions in no time. 5. Having a policy or measures of checking and screening trade ǰ QBSUOFSTǰPGǰUIFǰ$PNQBOZǰTVDIǰBTǰQSPEVDFSTǰBOEǰDPOUSBDUPST ǰ and support undertaking of businesses with trade partners who conduct business fairly without violating human rights and ǰ SFBMJ[JOHǰUIFǰJNQPSUBODFǰPGǰTPDJBMǰSFTQPOTJCJMJUZǰ5IFǰDPNQBOZǰ executes a purchasing policy and appoint a purchasing committee in order to select trade partners under transparency and accountability. ǰ /PUǰ HJWJOHǰ DPPQFSBUJPOǰ UPǰ PSǰ TVQQPSUJOHǰ BOZǰ QFSTPOTǰ PSǰ organizations which conduct illegal business or are a threat to the society and national security. ǰǰ #FJOHǰDPNNJUUFEǰUPǰNBJOUBJOJOHǰTVTUBJOBCMFǰSFMBUJPOTIJQǰXJUIǰUSBEFǰ partners and contract counterparts on the basis of mutual trust.

Ethics on Treatment of Creditors

ǰ 5SFBUJOHǰFNQMPZFFTǰXJUIǰSFTQFDUǰGPSǰUIFJSǰIPOPVS ǰEJHOJUZ ǰBOEǰ human rights. ǰ "QQPJOUJOH ǰ USBOTGFSJOH ǰ BOEǰ HJWJOHǰ QSJ[FTǰ BTǰ XFMMǰ BTǰ QVOJTIǰ ǰ FNQMPZFFTǰXJUIǰTJODFSJUZǰBOEǰBDDPSEJOHǰUPǰUIFJSǰLOPXMFEHF ǰDPNǰ petence, appropriateness, and fairness without any discrimination. ǰ "TTFTTJOHǰTUBGGǰQFSGPSNBODFǰBOEǰQSPHSFTTǰSFHVMBSMZ ǰ (JWJOHǰ SFNVOFSBUJPOǰ PGǰ WBSJPVTǰ UZQFTǰ UPǰ FNQMPZFFTǰ GBJSMZ ǰ appropriately and according to their knowledge, competence, experience, positions, responsibilities, and individual performance which are taken into consideration in line with the operating ǰ SFTVMUTǰ PGǰ UIFǰ $PNQBOZ ǰ FDPOPNJDǰ DPOEJUJPOTǰ BOEǰ TPDJBMǰ environment. ǰ 1SPWJEJOHǰBQQSPQSJBUFǰXFMGBSFǰBOEǰPUIFSǰCFOFųUTǰGPSǰFNQMPZFFTǰ that are comparable to those of other companies in the same or similar business and as prescribed by law, such as provident fund, etc. 6. Giving continuous and regular support and giving importance ǰ UPǰLOPXMFEHFǰBOEǰQPUFOUJBMǰEFWFMPQNFOUǰXIJDIǰJTǰCFOFųDJBMǰ to employees at all levels for their good career path. 7. Maintaining a good working environment for sanitation and safety to life and properties of employees regularly. ǰ 1SPWJEJOHǰBQQSPQSJBUFǰGBDJMJUJFTǰBOEǰXFMGBSFǰGPSǰEJTBCMFEǰFNQMPZFFT 9. Supporting employees to have better quality of life and support ǰ EFWFMPQNFOUǰPGǰMJGFǰPGǰFNQMPZFFTĴǰGBNJMJFTǰTPǰUIBUǰUIFZǰMJWFǰ a happy life and are able to rely on themselves sustainably ǰ BDDPSEJOHǰUPǰUIFǰQIJMPTPQIZǰPGǰTVGųDJFODZǰFDPOPNZ ǰ 1SPNPUJOHǰQBSUJDJQBUJPOǰPGǰFNQMPZFFTǰBOEǰSFTQFDUJOHǰUIFǰSJHIUTǰ of gathering of employees to gather to propose or set working ǰ HVJEFMJOFTǰBOEPSǰBHSFFNFOUTǰUPǰDSFBUFǰCFOFųUTǰGPSǰBMMǰQBSUJFTǰ and good working relations, including channel to complaint ǰ PGǰBOZǰXSPOHEPJOHT ǰBQQSPBDIǰUPǰGBDUǰųOEJOH ǰBOEǰQSPUFDUJPOǰPGǰ the whistle blower. ǰ 4VQQPSUJOHǰFNQMPZFFTǰUPǰXPSLǰUPHFUIFSǰVOEFSǰNVUVBMǰDVMUVSFǰ and value and with high unity spirits. ǰ .BOBHJOHǰXPSLTǰXJUIǰQSVEFODFǰBOEǰBWPJEJOHǰBOZǰVOGBJSǰBDUJPOTǰ which may have impact on the job security of employees. ǰ $PNQMZJOHǰXJUIǰSVMFTǰBOEǰSFHVMBUJPOTǰJOǰSFMBUJPOǰUPǰMBCPVSǰMBXǰ ǰ TVDIǰBTǰFNQMPZNFOU ǰUFSNJOBUJPOǰPGǰFNQMPZNFOU ǰFUD ǰBOEǰ welfare of employees.

5IFǰ#PBSEǰPGǰ%JSFDUPSTǰJTǰDPNNJUUFEǰUPǰDPOEVDUJOHǰCVTJOFTTǰUPǰDSFBUFǰ DSFEJUBCJMJUZǰGPSǰDSFEJUPSTǰǰ1PMJDZǰBOEǰ(VJEFMJOFTǰGPSǰUSFBUNFOUǰUPXBSEǰ DSFEJUPSTǰBSFǰBTǰGPMMPXT ǰ $PNQMZJOHǰXJUIǰBHSFFNFOUTǰBOEǰDPOEJUJPOTǰNVUVBMMZǰBHSFFEǰVQPOǰ ǰ TUSJDUMZǰ BOEǰ JOǰ DBTFǰ PGǰ OPODPNQMJBODFǰ XJUIǰ BOZǰ DPOEJUJPOT ǰ including obligaition and liablities, notify customers immediately to jointly seek solutions on a rationality basis. ǰ .BJOUBJOJOHǰBOǰBQQSPQSJBUFǰDBQJUBMǰTUSVDUVSFǰJOǰPSEFSǰUPǰTVQQPSUǰ ǰ UIFǰCVTJOFTTǰPQFSBUJPOǰBOEǰDSFEJUPSǰDPOųEFODFǰǰǰ ǰ /PUǰ HJWJOHǰ DPPQFSBUJPOǰ UPǰ PSǰ TVQQPSUJOHǰ BOZǰ QFSTPOTǰ PSǰ organizations which conduct illegal business or are a threat to the society and national security. ǰ #FJOHǰDPNNJUUFEǰUPǰNBJOUBJOJOHǰTVTUBJOBCMFǰSFMBUJPOTIJQǰXJUIǰ Ethics on Roles and Responsibilities towards Community, the creditors on the basis of mutual trust. Environment and the Society

Ethics on Treatment of Employees

5IFÇ°#PBSEÇ°PGÇ°%JSFDUPSTÇ°SFBMJ[FTÇ°UIBUÇ°FNQMPZFFTÇ°BSFÇ°UIFÇ°NPTUÇ°WBMVBCMFÇ° SFTPVSDFÇ°PGÇ°UIFÇ°$PNQBOZÇ°BOEÇ°JTÇ°BÇ°LFZÇ°UPÇ°TVDDFTTÇ°PGÇ°BDIJFWJOHÇ°UIFÇ° $PNQBOZÄ´TÇ°HPBMÇ°5IFSFGPSF Ç°UIFÇ°$PNQBOZÇ°UBLFTÇ°DBSFÇ°PGÇ°BOEÇ°USFBUTÇ° employees fairly in terms of opportunities, returns, appointment, transfer, termination of employment, as well as establishment of policies of personnel development, and encourages employees to develop and exhibit potential and personal value in order to help the organization HSPXÇ°DPOUJOVPVTMZÇ°BOEÇ°TVTUBJOBCMZÇ°Ç°1PMJDZÇ°BOEÇ°HVJEFMJOFTÇ°GPSÇ°USFBUNFOUÇ° UPXBSEÇ°FNQMPZFFTÇ°BSFÇ°BTÇ°GPMMPXT

5IFÇ° #PBSEÇ° PGÇ° %JSFDUPSTÇ° TUSPOHMZÇ° CFMJFWFTÇ° JOÇ° DPOEVDUJOHÇ° CVTJOFTTÇ° according to business ethics and good corporate governance principles BOEÇ°BMPOHTJEFÇ°DPSQPSBUFÇ°TPDJBMÇ°SFTQPOTJCJMJUZÇ° $43 Ç°UPÇ°CFÇ°FNCFEEFEÇ° BTÇ°QBSUÇ°PGÇ°UIFÇ°PSHBOJ[BUJPOÇ°DVMUVSFÇ°Ç°5IJTÇ°JTÇ°DBSSJFEÇ°CZÇ°JOUFHSBUJOHÇ°XJUIÇ° UIFÇ°$PNQBOZÄ´TÇ°WJTJPO Ç°NJTTJPO Ç°TUSBUFHZ Ç°BOEÇ°HPBMÇ°UPÇ°DSFBUFÇ°TVTUBJOBCMFÇ° CVTJOFTTÇ° HSPXUIÇ° 5IFÇ° $PNQBOZÇ° SFTQFDUTÇ° IVNBOÇ° SJHIUTÇ° USFBUTÇ° JUTÇ° workforce fairly; is accountable to customers and consumers; supports and takes part in development of the community, the society, and the environment; maintains religion; preserves natural resources and energy; and supports education and public activities, so that


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the community or underprivileged become strong and depend on UIFNTFMWFTǰTVTUBJOBCMZǰ1PMJDZǰBOEǰHVJEFMJOFTǰPOǰUSFBUNFOUǰUPXBSEǰ UIFǰDPNNVOJUZ ǰUIFǰFOWJSPONFOU ǰBOEǰUIFǰTPDJFUZǰBSFǰTQFDJųFEǰJOǰUIFǰ $PSQPSBUFǰ(PWFSOBODFǰBOEǰ#VTJOFTTǰ&UIJDTǰ.BOVBMǰSFHBSEJOHǰ&UIJDTǰ POǰ3PMFTǰBOEǰ3FTQPOTJCJMJUJFTǰUPXBSEǰ$PNNVOJUZ ǰ&OWJSPONFOU ǰBOEǰ 4PDJFUZ ǰEFUBJMTǰPGǰXIJDIǰBSFǰBTǰGPMMPXT ǰ 4VQQPSUJOHǰ $43ǰ EFWFMPQNFOUǰ UISPVHIǰ DPDSFBUJPOǰ XJUIǰ BMMǰ stakeholders by participating, inspiring, and giving opportunities to other organizations to work together. ǰ 4VQQPSUJOHǰQSPWJTJPOǰPGǰLOPXMFEHFǰBOEǰUSBJOJOHǰGPSǰTUBGGǰUPǰJOTUJMMǰ conscience of responsibility toward the community, the environment, and the society in employees at all levels and encourage employees to participate in activities arranged by ǰ UIFǰ$PNQBOZ ǰ )BWJOHǰ TPDJBMǰ QBSUJDJQBUJPOǰ CZǰ TVQQPSUJOHǰ BOEǰ QSPNPUJOHǰ activities which maintain good tradition and culture, and behaving as a good religion follower by supporting religious activities consistently. ǰ 1BSUJDJQBUJOHǰJOǰTVQQPSUJOHǰBDUJWJUJFTǰSFMBUJOHǰUPǰFEVDBUJPO ǰTQPSUJOHǰ capabilities, development of professional knowledge, for ǰ TVTUBJOBCMFǰTFMGEFQFOEFODF ǰ )BWJOHǰ TPDJBMǰ SFTQPOTJCJMJUZǰ SFMBUJOHǰ UPǰ QVCMJDǰ CFOFųUT ǰ maintenance of the environment, and development of the community as well as creative projects to promote and support better living of underprivileged, the elderly, children, and youths. 6. Having social responsibility in different forms such as organizing campaigns against narcotics continuously, hence promotion and support of children and youths to stay away from narcotics, ǰ MFBEJOHǰUPǰBǰTUSPOHǰDPNNVOJUZǰBOEǰOBSDPUJDGSFFǰTPDJFUZ 7. Holding various projects to assist and relieve misery of people who are in trouble in many ways. ǰ 4VQQPSUJOHǰ UIFǰ DPNNVOJUZǰ TVSSPVOEJOHǰ UIFǰ $PNQBOZǰ BOEǰ ǰ PUIFSǰ DPNNVOJUJFTǰ UPǰ CFǰ TUSPOHǰ BOEǰ TFMGEFQFOEFOUǰ JOǰ Bǰ sustainable manner, give mutual help, have a good quality of life, be happy and live happily in harmony. ǰ $BNQBJHOJOHǰBOEǰJOTUJMMJOHǰJOǰFNQMPZFFTǰDPOTDJFODFǰPGǰQSFTFSWB ǰ UJPOǰBOEǰTNBSUǰBOEǰFGųDJFOUǰVTFǰPGǰSFTPVSDFTǰBOEǰFOFSHZ ǰ $SFBUJOHǰ BOEǰ TVQQPSUJOHǰ BDUJWJUJFTǰ XIJDIǰ BSFǰ CFOFųDJBMǰ UPǰ maintenance, preservation, and use of natural resources and energy on a consistent basis. ǰ /PUǰQFSGPSNJOHǰBOZǰBDUTǰXIJDIǰXJMMǰJNQBJSǰUIFǰSFQVUBUJPOǰPGǰUIFǰ country, natural resources, and the environment. ǰ /PUǰDPPQFSBUJOHǰXJUIǰPSǰTVQQPSUǰBOZǰQFSTPOTǰPSǰPSHBOJ[BUJPOTǰ conducting illegal business or being a threat to the society and national security. ǰ $PNQMZJOHǰ PSǰ NPOJUPSJOHǰ UPǰ FOTVSFǰ TUSJDUǰ DPNQMJBODFǰ XJUIǰ relevant regulations and laws.

embracing human rights which are the basic rights ensuring that all human beings are born free and equal in dignity and rights without discrimination against berth, race, nationality, color, gender, religion, age, language, physical and health condition, personal status, economic and social status, social value, education or political opinion. 5IFǰ#PBSEǰBMTPǰQSPNPUFTǰFNQMPZFFTĴǰBXBSFOFTTǰPGǰUIFJSǰSJHIUT ǰEVUJFTǰ BOEǰSFTQPOTJCJMJUJFTǰUPǰTPDJFUZǰBOEǰPUIFSǰGFMMPXTǰ1PMJDZǰBOEǰ(VJEFMJOFTǰ BSFǰBTǰGPMMPXT ǰ 1FSGPSNJOHǰCVTJOFTTǰJOǰTUSJDUǰDPNQMJBODFǰXJUIǰIVNBOǰSJHIUǰMBXǰ and practice and provide employees with knowledge about human right law and practice for their further adoption in their work. ǰ &OTVSJOHǰUIBUǰBMMǰFNQMPZFFTǰGBNJMJBSJ[FǰUIFNTFMWFTǰXJUIǰMBXTǰ related to their duties and responsibilities and strictly observe such laws. ǰ 1SPNPUJOHǰUIFǰSFTQFDUǰPGǰBOEǰBEIFSFODFǰUPǰIVNBOǰSJHIUǰQSBDUJDFǰ on the basis of human dignity. ǰ 5SFBUJOHǰBMMǰFNQMPZFFTǰPOǰUIFǰCBTJTǰPGǰIVNBOǰEJHOJUZǰBOEǰSFTQFDUǰ their personal rights and duties. ǰ 0GGFSJOHǰBǰOPOEJTDSJNJOBUJWFǰBOEǰFRVBMǰDBSFFSǰPQQPSUVOJUZǰGPSǰ women, the disabled, incapacitated persons, and all other under privileged groups. ǰ /FJUIFSǰHJWFǰBǰTQFDJBMǰGBWPSǰUPǰOPSǰEJTDSJNJOBUFǰBHBJOTUǰBOZǰJOEJWJEVBMTǰ due to race, nationality, color, gender, religion, age, language, physical and health condition, personal status, economic and social status, social value, education and political opinion. ǰ &OTVSJOHǰ UIFǰ JODBQBDJUBUFEǰ FNQMPZFFTǰ BSFǰ QSPWJEFEǰ XJUIǰ appropriate facilitating equipment and welfare. ǰ 1VUUJOHǰJOǰQMBDFǰBǰQPMJDZǰPSǰNFBTVSFǰGPSǰTDSFFOJOHǰLFZǰUSBEFǰQBSUOFSTǰ such as suppliers and contractors and ensure that these key trade partners undertake their businesses with fair practices and ǰ OPOWJPMBUJPOǰPGǰIVNBOǰSJHIUT ǰ &ODPVSBHJOHǰFNQMPZFFTĴǰQBSUJDJQBUJPOǰBOEǰSFTQFDUǰUIFJSǰSJHIUǰUPǰ unify and come forward with their suggestions or ideas on operational directions and corrective measures that will be ǰ CFOFųDJBMǰUPǰBMMǰQBSUJFTǰBOEǰTUSFOHUIFOǰBǰHPPEǰXPSLJOHǰSFMBUJPOǰ and cooperation. ǰ &TUBCMJTIJOHǰBǰGPMMPXVQǰBOEǰNPOJUPSJOHǰQSPDFTTǰUPǰQSFWFOUǰUIFǰ ǰ $PNQBOZǰBOEǰFNQMPZFFTǰGSPNǰDPOEVDUJOHǰCVTJOFTT ǰBDUJOHǰPSǰ participating in an act or failing to act in such a way that violates human rights.

Ethics on Intellectual Property and Copyright

5IFÇ°#PBSEÇ°PGÇ°%JSFDUPSTÇ°IBTÇ°BÇ°QPMJDZÇ°UPÇ°SFTQFDUÇ°JOUFMMFDUVBMÇ°QSPQFSUZÇ° rights of other persons by not violating or supporting any acts which can be regarded as violation of intellectual property rights and copyrights PGÇ°PUIFSÇ°QFSTPOT Ç°UIVTÇ°SFÅ´FDUJOHÇ°UIFÇ°$PNQBOZÄ´TÇ°TUSPOHÇ°JOUFOUJPOÇ°UPÇ° conduct business with fairness, and respect for and compliance with UIFÇ°MBXTÇ°SFMBUJOHÇ°UPÇ°JOUFMMFDUVBMÇ°QSPQFSUZÇ°SJHIUTÇ°1PMJDZÇ°BOEÇ°(VJEFMJOFTÇ° BSFÇ°BTÇ°GPMMPXT Ethics on Respecting Human Right Law and Practice Ç° 4VQQPSUJOHÇ°EFWFMPQNFOUÇ° BOEÇ° SFTQFDUÇ° DSFBUJPOÇ° PSÇ° JOOPWBUJPOÇ° 5IFÇ°#PBSEÇ°PGÇ°%JSFDUPSTÇ°HJWFTÇ°JNQPSUBODFÇ°UPÇ°SFTQFDUJOHÇ°JOUFSOBUJPOBMÇ° of intellectual property rights and copyrights, and evaluate the human rights, to conducting business in compliance with laws, while value of such innovation fairly.


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ANNUAL REPORT 2013

GMM GRAMMY

ǰ 1SPUFDUJOHǰ BOEǰ SFTQFDUJOHǰ JOUFMMFDUVBMǰ QSPQFSUZǰ SJHIUTǰ BOEǰ ǰ DPQZSJHIUTǰPGǰUIFǰ$PNQBOZǰBOEǰPUIFSǰQFSTPOTǰCZǰOPUǰWJPMBUJOHǰ or supporting any acts which are in violation thereof, such as making duplicates, adapting original material in any way, copying, broadcasting music and pictures, or making distribution to the ǰ QVCMJDǰPSǰBOZǰPUIFSǰBDUT ǰBOEǰOPUǰDMBJNJOHǰPUIFSǰQFSTPOTĴǰXPSLTǰ ǰ BTǰPOFĴTǰPXO ǰ 4VQQPSUJOHǰBOEǰQBSUJDJQBUJOHǰJOǰBDUJWJUJFTǰXIJDIǰBSFǰCFOFųDJBMǰUPǰ protection and prevention of violation of intellectual property rights and copyrights. ǰ 4VQQPSUJOHǰQSPWJTJPOǰPGǰLOPXMFEHFǰBOEǰUSBJOJOHǰUPǰFNQMPZFFTǰ to instill conscience of respect and creation of intellectual property rights and copyrights in employees at all levels, as well as encourage employees to participate in activities held ǰ CZǰUIFǰ$PNQBOZ ǰ *TTVJOHǰUIFǰ$PNQBOZĴTǰXPSLǰSFHVMBUJPOTǰCZǰQSPIJCJUJOHǰFNQMPZFFTǰ from behaving in the manner which may tarnish the reputation ǰ PGǰ UIFǰ $PNQBOZǰ CZǰ GPMMPXJOHǰ SFHVMBUJPOT ǰ OPUJųDBUJPOT ǰ BOEǰ orders of government agencies, or laws relating to intellectual property rights and copyrights such as trademark law, patent law, license law or other relevant laws, as well as announcements, ǰ PSEFST ǰSVMFTǰBOEǰSFHVMBUJPOTǰTFUǰCZǰUIFǰ$PNQBOZ ǰ 5SFBUJOHǰBOEǰSFHBSEJOHǰWJPMBUJPOǰPGǰJOUFMMFDUVBMǰQSPQFSUZǰSJHIUTǰ and copyrights as a severe offence, and if such offence is found, ǰ UIFǰ$PNQBOZǰXJMMǰUBLFǰQFOBMǰBDUJPOǰBHBJOTUǰUIFǰFNQMPZFFǰXIPǰ has been found guilty of such violation according to the ǰ $PNQBOZĴTǰXPSLǰSFHVMBUJPOTǰBOEǰMBXT ǰ *Oǰ ǰUIFǰ$PNQBOZǰDPPQFSBUFEǰXJUIǰTUBUFǰBHFODJFTǰBOEǰSFMBUFEǰ ǰ QSJWBUFǰTFDUPSǰQBSUJFTǰJOǰBǰDBNQBJHOǰBHBJOTUǰQJSBDZǰUJUMFEǰij5PPL ǰ ǰ 5PPLǰ +BJ ǰ 5PPLǰ (PIEǰ .BJķǰ ij$IFBQ ǰ 1MFBTJOH ǰ -FHBM ǰ UPǰ SBJTFǰ awareness of copyright protection among the public through ǰ WBSJPVTǰBDUJWJUJFTǰ5IFǰij/PUǰ#VZ ǰ/PUǰ4FMM ǰ/PUǰ6TFǰ1JSBUFǰ(PPETķǰ slogan aims to encourage the public to be more aware of the intellectual property to help reduce the piracy problem in the ǰ MPOHǰSVOǰ5IFǰ$PNQBOZǰKPJOFEǰIBOETǰXJUIǰTUBUFǰBHFODJFTǰBOEǰ the private sector to prevent piracy and prosecute violators. ǰ #ZǰUIFǰZFBSǰǰUIFǰ$PNQBOZǰBOEǰJUTǰBGųMJBUFTǰIBWFǰUBLFOǰMFHBMǰ ǰ BDUJPOǰ BHBJOTUǰ ǰ QJSBDZǰ DBTFTǰ DPNQPTJOHǰ PGǰ ǰ MBXTVJUTǰ ǰ TFUUMFNFOU ǰ ǰ QSPTFDVUJPOǰ QFOEJOHǰ DBTFTǰ BOEǰ ǰ KVEHFEǰ cases.

Ethics on Vested Interest and Conflict of Interest 5IFÇ°#PBSEÇ°PGÇ°%JSFDUPSTÇ°JTÇ°BXBSFÇ°PGÇ°UIFÇ°JNQPSUBODFÇ°PGÇ°DPOÅ´JDUÇ°PGÇ°JOUFSFTUÇ° QSFWFOUJPOÇ°BOEÇ°IBTÇ°UIVTÇ°BEPQUFEÇ°UIFÇ°GPMMPXJOHÇ°QPMJDZÇ°BOEÇ°HVJEFMJOFT Ç° 5PÇ°TBGFHVBSEÇ°BHBJOTUÇ°BÇ°DPOÅ´JDUÇ°PGÇ°JOUFSFTU Ç°UIFÇ°#PBSEÇ°PGÇ°%JSFDUPSTÇ° exercises due care when there occurs any transaction involving Ç° BÇ° QPUFOUJBMÇ° DPOÅ´JDUÇ° PGÇ° JOUFSFTUÇ° CZÇ° PCTFSWJOHÇ° BÇ° QPMJDZÇ° BOEÇ° procedure for approval of connected transactions, established Ç° JOÇ°XSJUJOHÇ°JOÇ°UIFÇ°"VUIPSJ[BUJPOÇ°BOEÇ°1SPDFEVSFÇ°.BOVBM Ç°BOEPSÇ° Ç° TFFLJOHÇ° BQQSPWBMÇ° GSPNÇ° TIBSFIPMEFSTÇ° JOÇ° MJOFÇ° XJUIÇ° UIFÇ° 4&5Ç° Ç° SFHVMBUJPOT Ç°BTÇ°XFMMÇ°BTÇ°DPNQMZJOHÇ°XJUIÇ°UIFÇ°4&5Ä´TÇ°SFHVMBUJPOT Ç° Ç° XJUIÇ°USBOTBDUJPOÇ°QSJDFÇ°BOEÇ°DPOEJUJPOTÇ°FYFDVUFEÇ°POÇ°BOÇ°BSNÄ´TÇ° length basis.

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Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç°

*GǰUIFǰDPOOFDUFEǰUSBOTBDUJPOǰJTǰTVCKFDUǰUPǰBQQSPWBMǰGSPNǰUIFǰ #PBSEǰPGǰ%JSFDUPST ǰUIFSFǰNVTUǰCFǰJOEFQFOEFOUǰEJSFDUPSTǰPSǰ"VEJUǰ $PNNJUUFFǰNFNCFSTǰQBSUJDJQBUJOHǰJOǰUIFǰSFMFWBOUǰ#PBSEǰNFFUJOH 5IFǰ"VEJUǰ$PNNJUUFFǰJTǰUPǰSFHVMBSMZǰQSPQPTFǰBOZǰDPOŴJDUFEǰ USBOTBDUJPOTǰBOEǰDPOOFDUFEǰUSBOTBDUJPOTǰUPǰUIFǰ#PBSEǰPGǰ%JSFDUPSTǰ BOEǰUIFǰQFSTPOǰXJUIǰBǰQPUFOUJBMǰDPOŴJDUǰPGǰJOUFSFTUǰJTǰOPUǰFOUJUMFEǰ to cast vote on or approve any such transactions. #FGPSFǰFOUFSJOHǰJOUPǰBǰDPOOFDUFEǰUSBOTBDUJPOǰXIJDIǰJTǰSFRVJSFEǰ to be disclosed publicly or be approved by the shareholders in BDDPSEBODFǰXJUIǰUIFǰ4&5ǰSFHVMBUJPOT ǰUIFǰ$PNQBOZǰTIBMMǰDMFBSMZǰ disclose to the shareholders details such as names and nature of relationship of the connected persons, policy on determination of transaction price, rationale for entering into the transaction, BOEǰPQJOJPOǰPGǰUIFǰ#PBSEǰPGǰ%JSFDUPSTǰPOǰUIFǰUSBOTBDUJPO 'PSǰUSBOTBDUJPOTǰUIBUǰJOWPMWFǰųOBODJBMǰBTTJTUBODF ǰUIFǰ#PBSEǰPGǰ %JSFDUPSTǰIBTǰFTUBCMJTIFEǰBǰHVJEFMJOFǰPOǰUIJTǰUZQFǰPGǰDPOOFDUFEǰ USBOTBDUJPOTǰJOǰUIFǰ$PSQPSBUFǰ"VUIPSJ[BUJPOǰ*OEFYǰXIJDIǰXBTǰ EVMZǰBQQSPWFEǰCZǰUIFǰ#PBSEǰPGǰ%JSFDUPSTǰ 5IFǰ#PBSEǰPGǰ%JSFDUPSTǰIBTǰQSPIJCJUFEǰEJSFDUPST ǰNBOBHFNFOUǰ and employees who have access to insider information from trading UIFǰ$PNQBOZĴTǰTFDVSJUJFTǰEVSJOHǰBǰPOFNPOUIǰQFSJPEǰCFGPSFǰBǰ SFMFBTFǰPGǰUIFǰ$PNQBOZĴTǰųOBODJBMǰTUBUFNFOUTǰUPǰUIFǰQVCMJD 5IFǰ#PBSEǰPGǰ%JSFDUPSTǰIBTǰTFUǰBǰQPMJDZǰSFRVJSJOHǰUIBUǰUIFǰEJSFDUPST ǰ &YFDVUJWFǰ$PNNJUUFFǰNFNCFSTǰBOEǰNBOBHFNFOUǰ BTǰEFųOFEǰ CZǰ 4&$ǰ BOEǰ 4&5 ǰ JODMVEJOHǰ UIFJSǰ SFTQFDUJWFǰ SFMBUFEǰ QFSTPOTǰ BDDPSEJOHǰUPǰ4FDUJPOǰǰPGǰUIFǰ4FDVSJUJFTǰBOEǰ&YDIBOHFǰ"DU ǰSFQPSUǰ UIFJSǰIPMEJOHǰPGǰUIFǰ$PNQBOZĴTǰTFDVSJUJFT ǰBOEǰUIBUǰUIFǰ$PNQBOZǰ Secretary submit a summary report on the said securities IPMEJOHǰBOEǰDIBOHFTǰJOǰTFDVSJUJFTǰIPMEJOHǰJOǰUIFǰ$PNQBOZǰUPǰ UIFǰ#PBSEǰPGǰ%JSFDUPSTĴǰNFFUJOHǰGPSǰBDLOPXMFEHFNFOU 5IFǰ #PBSEǰ PGǰ %JSFDUPSTǰ IBTǰ TUJQVMBUFEǰ UIBUǰ UIFǰ EJSFDUPST ǰ NBOBHFNFOUǰBOEǰUIFJSǰSFMBUFEǰQFSTPOTǰ BTǰEFųOFEǰCZǰ4&$ǰBOEǰ 4&5 ǰ NVTUǰ QSFQBSFǰ BOEǰ TVCNJUǰ Bǰ SFQPSUǰ POǰ JOUFSFTUTǰ UPǰ UIFǰ $PNQBOZǰBOEǰUIFǰ$PNQBOZǰ4FDSFUBSZǰIBTǰUIFǰEVUZǰUPǰTVCNJUǰ a summary report on the interests of the directors, management and their related persons and any subsequent changes thereof UPǰUIFǰ#PBSEǰPGǰ%JSFDUPSTĴǰNFFUJOHǰGPSǰBDLOPXMFEHFNFOUǰPOǰBǰ TFNJBOOVBMǰCBTJT 5IFǰ#PBSEǰPGǰ%JSFDUPSTǰIBTǰTUJQVMBUFEǰUIBUǰBMMǰNBUFSJBMǰDPOOFDUFEǰ USBOTBDUJPOT ǰ XJUIǰ EFUBJMTǰ SFHBSEJOHǰ UIFǰ DPOŴJDUFEǰ QFSTPOT ǰ nature of relationship, type of the transactions, conditions for the transactions, pricing policy, transaction value, rationale and OFDFTTJUZǰPGǰUIFǰUSBOTBDUJPOT ǰBOEǰPQJOJPOǰSFOEFSFEǰCZǰUIFǰ"VEJUǰ $PNNJUUFFǰBOEPSǰUIFǰ#PBSEǰPGǰ%JSFDUPST ǰNVTUǰCFǰSFWFBMFEǰJOǰBOǰ JOGPSNBUJPOǰ NFNPSBOEVNǰ BOEPSǰ UIFǰ $PNQBOZĴTǰ BOOVBMǰ SFHJTUSBUJPOǰTUBUFNFOUǰ 'PSNǰ ǰBOEǰBOOVBMǰSFQPSU

Chapter 4 Information Disclosure and Transparency

5IFǰ #PBSEǰ PGǰ %JSFDUPSTǰ TVQFSWJTFTǰ UIFǰ $PNQBOZǰ UPǰ DPNNVOJDBUFǰ BOEǰEJTDMPTFǰJNQPSUBOUǰJOGPSNBUJPOǰSFMBUJOHǰUPǰUIFǰ$PNQBOZ ǰFJUIFSǰ ųOBODJBMǰPSǰOPOųOBODJBMǰJOGPSNBUJPO ǰTIBSFIPMEJOHǰBOEǰNBOBHFNFOUǰ TUSVDUVSFǰTVGųDJFOUMZ ǰBDDVSBUFMZ ǰDPNQMFUFMZ ǰUSBOTQBSFOUMZ ǰSFMJBCMZ ǰ


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thoroughly, and in a timely manner, and in line with the guidelines or DSJUFSJBÇ°TFUÇ°CZÇ°UIFÇ°4&$Ç°BOEÇ°UIFÇ°4&5 Ç°BTÇ°XFMMÇ°BTÇ°SFMFWBOUÇ°MBXT Ç°TUBOEBSET Ç° BOEÇ°CFTUÇ°QSBDUJDFTÇ°POÇ°CVTJOFTTÇ°PQFSBUJPOTÇ°BOEÇ°EJTDMPTVSFÇ°PGÇ°ĹłOBODJBMÇ° JOGPSNBUJPO Ç°UISPVHIÇ°WBSJPVTÇ°DIBOOFMTÇ°BOEÇ°*OWFTUPSÇ°3FMBUJPOTÇ°XIJDIÇ° BSFÇ° BDDFTTJCMFÇ° DPOWFOJFOUMZÇ° BOEÇ° FRVJUBCMZÇ° 5IFÇ° $PNQBOZÄ´TÇ° LFZÇ° HVJEFMJOFTÇ°BSFÇ°BTÇ°GPMMPXT

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ANNUAL REPORT 2013

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GMM GRAMMY

ǰ 8FMDPNFEǰJOTUJUVUJPOBMǰBOBMZTUTǰBOEǰJOWFTUPSTǰJOǰUIFǰ country and overseas as well as retail investors who visited ǰ ǰ UIFǰ$PNQBOZǰUPǰFORVJSFǰBCPVUǰJUTǰPQFSBUJOHǰSFTVMUTǰ ǰ ǰ .BEFǰ QSFTTǰ SFMFBTFǰ XIFOFWFSǰ UIFǰ $PNQBOZǰ IBEǰ investment activities or important business activities. ǰ ǰ 1BSUJDJQBUFEǰ JOǰ EPNFTUJDǰ BOEǰ BCSPBEǰ SPBETIPXTǰ ǰ ǰ QSPWJEJOHǰ UIFǰ $PNQBOZĴTǰ JOGPSNBUJPOǰ BOEǰ PWFSBMMǰ industrial condition to the domestic and foreign ǰ ǰ JOTUJUVUJPOBMǰJOWFTUPSTǰGPSǰǰUJNFTǰBOEǰǰUJNFT ǰSFTQFDUJWFMZǰ ǰ ǰ 8FMDPNFEǰBOBMZTUTǰBOEǰTIBSFIPMEFSTǰVOEFSǰUIFǰTJUFǰWJTJUǰ ǰ ǰ QSPHSBNǰDBMMFEǰĶ0QFOǰUIFǰEPPSǰUPǰ(3"..:ķ ǰXIFSFǰ analysts and sharedholder are invited to visit the ǰ ǰ $PNQBOZǰGPSǰǰUJNFTǰBOEǰJUTǰTVCTJEJBSJFTǰJOǰUIFǰGPSNǰPGǰ a lecture and a real work place observation for better ǰ ǰ VOEFSTUBOEJOHǰBOEǰDMFBSǰDMFBSǰWJTJPOǰPGǰUIFǰ(3"..:ǰ Group businesses such as broadcasting stations, ǰ ǰ TUVEJPFT ǰSBEJPǰTUBUJPOTǰFUDǰ5IJTǰQSPHSBNǰXBTǰBUUSBDUJWFǰ and the anaysts were interested to participate very much. 6. Gave information and answered questions of investors ǰ ǰ BOEǰUIFǰQSFTTǰXIPǰDPOUBDUFEǰCZǰ&NBJM ǰUFMFQIPOFǰBOEǰ fax as the above.  ǰ 0GųDFǰPGǰ$PSQPSBUFǰ4FDSFUBSZ ǰ 5IFǰ#PBSEǰPGǰ%JSFDUPSTǰIBTǰTFUǰVQǰ0GųDFǰPGǰ$PSQPSBUFǰ4FDSFUBSZǰ ǰ UPǰCFǰSFTQPOTJCMFǰGPSǰUIFǰ$PNQBOZĴTǰIJHIMFWFMǰNFFUJOHT ǰ ǰ TVDIǰBTǰUIFǰ#PBSEǰPGǰ%JSFDUPSTĴǰNFFUJOH ǰTIBSFIPMEFSTĴǰ ǰ NFFUJOHTǰ BOEǰ &YFDVUJWFǰ $PNNJUUFFǰ NFFUJOHǰ UPǰ FOTVSFǰ ǰ UIBUǰUIFǰ$PNQBOZ ǰUIFǰ#PBSEǰPGǰ%JSFDUPST ǰBOEǰFYFDVUJWFTǰ operate in accordance with legal provisions and the requirements of regulatory agencies, and serve as the point ǰ PGǰ DPOUBDUǰ GPSǰ DPNNVOJDBUJPOTǰ CFUXFFOǰ TIBSFIPMEFST ǰ TUBLFIPMEFSTǰBOEǰUIFǰ$PNQBOZǰJOǰEJTTFNJOBUJOHǰSFMFWBOUǰ or useful information and activities, as well as receiving ǰ SFDPNNFOEBUJPOTǰ PSǰ DPPSEJOBUJOHǰ UIFǰ DMBSJųDBUJPOǰ PGǰ ǰ TIBSFIPMEFSTĴǰRVFTUJPOTǰPOǰUIFǰ$PNQBOZĴTǰCVTJOFTTFTǰPSǰ operations. 0GųDFǰPGǰ$PSQPSBUFǰ4FDSFUBSZ ǰ (..ǰ (SBNNZǰ 1MD ǰ ǰ (..ǰ (SBNNZǰ 1MBDF ǰ stǰ 'MPPS ǰ 4VLIVNWJUǰ ǰ 3Eǰ "TPLF ǰ ,MPOHUPFJOVFB ǰ 8BUUBOB ǰ ǰ #BOHLPLǰ ǰ 5FMǰ  ǰǰǰǰ  ǰǰǰǰ ǰ 'BYǰ  ǰǰ ǰ &NBJMǰ"EESFTTǰDT!HNNHSBNNZDPN

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3. Reporting of performance of duties of the Board of Directors and Sub-Committees Ç° Ç°

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1) Ç° Ç°

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4. Connected Transactions and Conflict of Interest Prevention

2. Disclosure of information of the Board of Directors and Ç°Ç° Sub-Committees Ç° Ç° Ç° Ç° Ç°

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for the transactions, pricing policy, transaction value, rationale and necessity of the transactions, and opinion ǰ SFOEFSFEǰCZǰUIFǰ"VEJUǰ$PNNJUUFFǰBOEPSǰUIFǰ#PBSEǰPGǰ ǰ %JSFDUPST ǰ NVTUǰ CFǰ SFWFBMFEǰ JOǰ UIFǰ $PNQBOZĴTǰ BOOVBMǰ ǰ SFHJTUSBUJPOǰTUBUFNFOUǰ 'PSNǰ ǰBOEǰBOOVBMǰSFQPSU ǰBTǰ ǰ QSFTFOUFEǰVOEFSǰTFDUJPO ǰĶ$POOFDUFEǰ5SBOTBDUJPOTķ ǰ *Oǰ ǰUIFǰ$PNQBOZǰEJEǰOPUǰCSFBDIǰPSǰGBJMǰUPǰDPNQMZǰ with the rules on connected transactions stipulated by ǰ 4&5ǰBOEǰUIFǰ4&$ 2) Report on securities holding and changes in securities holding in the Company ǰ 5IFǰ#PBSEǰPGǰ%JSFDUPSTǰIBTǰTUJQVMBUFEǰUIBUǰUIFǰEJSFDUPST ǰ ǰ FYFDVUJWFǰEJSFDUPSTǰBOEǰNBOBHFNFOUǰ BTǰEFųOFEǰCZǰ4&$ǰ ǰ BOEǰ 4&5 ǰ JODMVEJOHǰ UIFJSǰ SFTQFDUJWFǰ SFMBUFEǰ QFSTPOTǰ ǰ BDDPSEJOHǰUPǰ4FDUJPOǰǰPGǰUIFǰ4FDVSJUJFTǰBOEǰ&YDIBOHFǰ"DU ǰ ǰ TIBMMǰCFǰPCMJHBUFEǰUPǰSFQPSUǰUIFJSǰIPMEJOHǰPGǰUIFǰ$PNQBOZĴTǰ ǰ TIBSFTǰ (3"..: ǰBTǰGPMMPXT  2 Report of securities dealing in the company at least ǰ ǰ ǰEBZǰCFGPSFǰFYFDVUJOHǰUIFǰUSBOTBDUJPOǰǰ  2ǰ 3FQPSUǰPGǰTFDVSJUJFTǰIPMEJOHǰJOǰUIFǰ$PNQBOZǰ 'PSNǰ ǰ ǰ ǰ GPSǰųSTUǰTVCNJTTJPOǰXJUIJOǰǰEBZTǰBGUFSǰCFJOHǰBQQPJOUFEǰ ǰ ǰ BTǰEJSFDUPSNBOBHFNFOU 2ǰ 3FQPSUǰPGǰDIBOHFTǰJOǰTFDVSJUJFTǰIPMEJOHǰJOǰUIFǰ$PNQBOZǰ ǰ ǰ 'PSNǰ  ǰ UPǰ CFǰ QSFQBSFEǰ XIFOFWFSǰ UIFǰ BCPWFǰ mentioned persons buy, sell, transfer or accept a ǰ ǰ USBOTGFSǰPGǰUIFǰ$PNQBOZĴTǰTFDVSJUJFTǰBOEǰUPǰCFǰTVCNJUUFEǰ ǰ ǰ XJUIJOǰ ǰ CVTJOFTTǰ EBZTǰ GSPNǰ UIFǰ EBUFǰ PGǰ TVDIǰ transaction. ǰ ǰ "ǰDPQZǰPGǰUIFǰBCPWFǰSFQPSUǰNVTUǰCFǰEFMJWFSFEǰUPǰUIFǰ ǰ ǰ $PNQBOZǰCZǰUIFǰEBUFǰUIFǰSFQPSUǰJTǰTVCNJUUFEǰUPǰ4&$ ǰ ǰ 5IFǰ $PNQBOZǰ 4FDSFUBSZǰ IBTǰ UIFǰ EVUZǰ UPǰ TVCNJUǰ a summary report on the said securities holding and ǰ ǰ DIBOHFTǰJOǰTFDVSJUJFTǰIPMEJOHǰJOǰUIFǰ$PNQBOZǰUPǰUIFǰ ǰ ǰ #PBSEǰPGǰ%JSFDUPSTĴǰNFFUJOHǰGPSǰBDLOPXMFEHFNFOUǰBOEǰ ǰ ǰ UPǰ EJTDMPTFǰ JUǰ JOǰ UIFǰ $PNQBOZĴTǰ BOOVBMǰ SFHJTUSBUJPOǰ ǰ ǰ TUBUFNFOUǰ 'PSNǰ ǰBOEǰBOOVBMǰSFQPSUǰ BTǰEFTDSJCFEǰ ǰ ǰ VOEFSǰTFDUJPO ǰĶ.BOBHFNFOUǰ4USVDUVSFķ

 ǰ 3FQPSUǰ POǰ JOUFSFTUTǰ PGǰ UIFǰ #PBSEǰ PGǰ %JSFDUPST ǰ management and their related persons ǰ 5IFǰ#PBSEǰPGǰ%JSFDUPSTǰIBTǰTUJQVMBUFEǰUIBUǰUIFǰEJSFDUPSTǰ ǰ BOEǰNBOBHFNFOUǰ BTǰEFųOFEǰCZǰ4&$ǰBOEǰ4&5 ǰJODMVEJOHǰ their related persons, must abide by Section 89 of the ǰ 4FDVSJUJFTǰBOEǰ&YDIBOHFǰ"DUǰBOEǰNVTUǰQSFQBSFǰBOEǰTVCNJUǰ ǰ Bǰ3FQPSUǰPOǰ*OUFSFTUTǰ JODMVEJOHǰBOZǰTVCTFRVFOUǰDIBOHFTǰ ǰ UIFSFPG ǰUPǰUIFǰ$PNQBOZǰ5IFǰ$PNQBOZǰ4FDSFUBSZǰIBTǰUIFǰ ǰ EVUZǰUPǰTVCNJUǰBǰTVNNBSZǰSFQPSUǰPOǰUIFǰJOUFSFTUTǰ BOEǰBOZǰ ǰ TVCTFRVFOUǰDIBOHFTǰUIFSFPG ǰPGǰUIFǰEJSFDUPST ǰNBOBHFNFOUǰ ǰ BOEǰUIFJSǰSFMBUFEǰQFSTPOTǰUPǰUIFǰ#PBSEǰPGǰ%JSFDUPSTĴǰ.FFUJOHǰ ǰ GPSǰBDLOPXMFEHFNFOUǰPOǰBǰTFNJBOOVBMǰCBTJT ǰ 5IFǰ$PNQBOZǰ4FDSFUBSZǰLFFQTǰBǰųMJOHǰPGǰUIFǰPSJHJOBMǰ3FQPSUǰ ǰ POǰ*OUFSFTUTǰBOEǰTVCNJUTǰBǰDPQZǰUIFSFPGǰUPǰ$IBJSNBOǰPGǰ ǰ UIFǰ#PBSEǰBOEǰ$IBJSNBOǰPGǰUIFǰ"VEJUǰ$PNNJUUFF

5. Remuneration for the Directors, Members of Sub-Committees and Management Ç° Ç° Ç°

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3FNVOFSBUJPOÇ° GPSÇ° UIFÇ° EJSFDUPSTÇ° BOEÇ° TVCDPNNJUUFFÇ° NFNCFST 5IFÇ°#PBSEÇ°PGÇ°%JSFDUPSTÇ°IBTÇ°BTTJHOFEÇ°UIFÇ°/PNJOBUJPOÇ°BOEÇ° 3FNVOFSBUJPOÇ°$PNNJUUFFÇ°UPÇ°GPSNVMBUFÇ°SVMFTÇ°BOEÇ°QPMJDZÇ° on determination of remuneration for members of the #PBSEÇ°PGÇ°%JSFDUPSTÇ°BOEÇ°TVCDPNNJUUFFTÇ°BOEÇ°TVCNJUÇ°UIFNÇ° UPÇ°UIFÇ°#PBSEÇ°PGÇ°%JSFDUPSTÇ°BOEPSÇ°UIFÇ°TIBSFIPMEFSTÄ´Ç°NFFUJOHÇ° GPSÇ°BQQSPWBM Ç°BTÇ°UIFÇ°DBTFÇ°NBZÇ°CFÇ°5IFÇ°TBJEÇ°QPMJDZÇ°JTÇ°PVUMJOFEÇ° based on an assessment of compensation level that is commensurate with respective duties and responsibilities BOEÇ°DPNQBSBCMFÇ°XJUIÇ°UIBUÇ°PGÇ°QFFST Ç°BTÇ°XFMMÇ°BTÇ°CFOFųUTÇ° FYQFDUFEÇ° GSPNÇ° FBDIÇ° EJSFDUPSÇ° *OÇ° BEEJUJPO Ç° JOÇ° PSEFSÇ° UPÇ° EFUFSNJOFÇ° BQQSPQSJBUFÇ° DPNQFOTBUJPOÇ° "QBSUÇ° GSPNÇ° UPÇ° participating in the annual director remuneration survey QSPKFDUÇ°DPOEVDUFEÇ°CZÇ°UIFÇ°5IBJÇ°*OTUJUVUFÇ°PGÇ°%JSFDUPSTÇ°CZÇ° QSPQPTJOHÇ° UIFÇ° TVSWFZÄ´TÇ° SFTVMUTÇ° UPÇ° UIFÇ° /PNJOBUJPOÇ° BOEÇ° 3FNVOFSBUJPOÇ°$PNNJUUFFÇ°GPSÇ°VTFÇ°JOÇ°UIFÇ°DPOTJEFSBUJPOÇ°PGÇ° EJSFDUPSÇ°SFNVOFSBUJPO Ç°UIFÇ°$PNQBOZÇ°VTFEÇ°UIFÇ°JOGPSNBUJPOÇ° POÇ°SFNVOFSBUJPOÇ°PGÇ°EJSFDUPSTÇ°BOEÇ°FYFDVUJWFTÇ°PGÇ°4&5Ä´TÇ°MJTUFEÇ° companies in consideration of such matter. 5IFÇ°/PNJOBUJPOÇ°BOEÇ°3FNVOFSBUJPOÇ°$PNNJUUFFÇ°XJMMÇ°QSPQPTFÇ° UIFÇ°SVMFTÇ°BOEÇ°QPMJDZÇ°POÇ°UIFÇ°EFUFSNJOBUJPOÇ°PGÇ°EJSFDUPSTÄ´Ç° SFNVOFSBUJPOÇ° BOEÇ° UIFÇ° ZFBSMZÇ° NPOFUBSZÇ° BOEPSÇ° OPO NPOFUBSZÇ°SFNVOFSBUJPOÇ°GPSÇ°FBDIÇ°QPTJUJPOÇ°UPÇ°UIFÇ°#PBSEÇ°PGÇ° %JSFDUPSTÇ° GPSÇ° DPOTJEFSBUJPOÇ° BOEÇ° UPÇ° UIFÇ° TIBSFIPMEFSTÄ´Ç° meeting for approval, and will submit the rules and policy on the determination of remuneration and the monetary BOEPSÇ°OPONPOFUBSZÇ°SFNVOFSBUJPOÇ°GPSÇ°FBDIÇ°QPTJUJPOÇ°PGÇ° TVCDPNNJUUFFTÇ° JGÇ°BOZ Ç°GPSÇ°UIFÇ°TIBSFIPMEFSTÄ´Ç°JOGPSNBUJPOÇ° on a yearly basis. Directorsâ&#x20AC;&#x2122; remuneration 3FNVOFSBUJPOÇ°GPSÇ°UIFÇ°EJSFDUPSTÇ°JOÇ° Ç°BTÇ°BQQSPWFEÇ°CZÇ° UIFÇ°TIBSFIPMEFSTÄ´Ç°NFFUJOH Ç°XBTÇ°DPNQSJTFEÇ°PGÇ°BOOVBMÇ°CPOVTÇ° XIJDIÇ°XBTÇ°QBJEÇ°JOUPÇ°Ç°QPSUJPOTÇ°BTÇ°GPMMPXT  Ç° .FFUJOHÇ°"MMPXBODFÇ° QBJEÇ°CBTFEÇ°POÇ°OVNCFSÇ°PGÇ°NFFUJOHTÇ° Ç° BUUFOEFEÇ°CZÇ°FBDIÇ°EJSFDUPS  6OJUÇ°#BIUQFSTPONFFUJOH 1PTJUJPOÇ°

.FFUJOHÇ°BMMPXBODF

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*OEFQFOEFOUÇ°%JSFDUPSÇ°

 

%JSFDUPSÇ°

 

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 Ç° "OOVBMÇ°#POVTÇ° BOOVBMÇ°QBZNFOU Ç°$SJUFSJBÇ°GPSÇ°QBZNFOUÇ° Ç° XBTÇ° UIFÇ° TBNFÇ° BTÇ° UIBUÇ° JOÇ°  Ç° GPMMPXJOHÇ° SFTPMVUJPOÇ° Ç° QBTTFEÇ°CZÇ°UIFÇ°TIBSFIPMEFSTÄ´Ç°NFFUJOH Ç°BTÇ°GPMMPXT 2Ç° 5IFÇ°BOOVBMÇ°#POVTÇ°GPSÇ°UIFÇ°#PBSEÇ°PGÇ°%JSFDUPSTÇ°JOÇ°Ç° Ç° Ç° XBTÇ°TFUÇ°BNPVOUJOHÇ°UPÇ°OPUÇ°NPSFÇ°UIBOÇ°  Ç°Ç° baht, net of meeting allowance paid for that


174

ANNUAL REPORT 2013

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GMM GRAMMY

year, the remainder annual bonus was paid upon meeting attendance of each director. 2ǰ 5IFǰ BOOVBMǰ CPOVTǰ BGUFSǰ EFEVDUJOHǰ NFFUJOHǰ ǰ ǰ BMMPXBODF ǰJTǰBMMPDBUFEǰCBTFEǰPOǰUIFǰOVNCFSǰPGǰ ǰ ǰ NFFUJOHTǰBUUFOEFEǰCZǰFBDIǰEJSFDUPSǰǰ5IFǰQBZNFOUǰ ǰ ǰ GPSǰ$IBJSNBOǰPGǰUIFǰ#PBSEǰJTǰEPVCMFEǰGPSǰUIFǰOVNCFSǰ ǰ ǰ PGǰUIFǰ#PBSEǰNFFUJOHTǰIFǰBUUFOET 3FNVOFSBUJPOǰGPSǰNFNCFSTǰPGǰ4VC$PNNJUUFFT 3FNVOFSBUJPOǰGPSǰUIFǰ"VEJUǰ$PNNJUUFF ǰBTǰBQQSPWFEǰCZǰUIFǰ TIBSFIPMEFSTĴǰNFFUJOH ǰXBTǰOPUǰFYDFFEJOHǰ ǰCBIUǰ JOǰUPUBMǰBOEǰXBTǰQBJEǰCBTFEǰPOǰUIFǰGPMMPXJOHǰDSJUFSJB 6OJUǰ#BIU:FBS 1PTJUJPOǰ

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$IBJSNBOǰPGǰUIFǰ"VEJUǰ$PNNJUUFFǰ

 

.FNCFSǰPGǰUIFǰ"VEJUǰ$PNNJUUFFǰ QFSǰQFSTPO

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2) ǰ ǰ ǰ ǰ ǰ ǰ

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3FNVOFSBUJPOǰGPSǰPUIFSǰ4VC$PNNJUUFFT ǰOBNFMZǰ(SPVQǰ &YFDVUJWFǰ $PNNJUUFF ǰ /PNJOBUJPOǰ BOEǰ 3FNVOFSBUJPOǰ $PNNJUUFF ǰ3JTLǰ.BOBHFNFOUǰ$PNNJUUFF ǰBOEǰ$PSQPSBUFǰ (PWFSOBODFǰ BOEǰ &UIJDTǰ $PNNJUUFF ǰ IBEǰ OPUǰ ZFUǰ CFFOǰ determined. Management’s remuneration 3FNVOFSBUJPOǰGPSǰNBOBHFNFOUǰ BTǰEFųOFEǰCZǰ4&$ǰBOEǰ4&5 ǰ DPOGPSNTǰUPǰUIFǰQSJODJQMFǰBOEǰQPMJDZǰPVUMJOFEǰCZǰUIFǰ#PBSEǰ PGǰ%JSFDUPSTǰBOEǰJTǰCBTFEǰVQPOǰPQFSBUJOHǰSFTVMUTǰPGǰUIFǰ $PNQBOZǰBOEǰQFSGPSNBODFǰPGǰFBDIǰFYFDVUJWF 5IFǰQPMJDZ ǰQSJODJQMFǰBOEǰSBUJPOBMFǰGPSǰEFUFSNJOBUJPOǰPGǰ SFNVOFSBUJPOǰBOEǰUIFǰZFBSMZǰNPOFUBSZǰBOEǰOPONPOFUBSZǰ remuneration for the directors, members of board DPNNJUUFFTǰBOEǰNBOBHFNFOUǰ BTǰEFųOFEǰCZǰ4&$ǰBOEǰ4&5 ǰ BSFǰ EJTDMPTFEǰ JOǰ UIFǰ $PNQBOZĴTǰ BOOVBMǰ SFHJTUSBUJPOǰ TUBUFNFOUǰ 'PSNǰ ǰBOEǰBOOVBMǰSFQPSUǰVOEFSǰTFDUJPO ǰ Ķ3FNVOFSBUJPOǰGPSǰ#PBSEǰPGǰ%JSFDUPST ǰ4VC$PNNJUUFFT ǰ BOEǰ.BOBHFNFOUķ

Chapter 5 Responsibilities of the Board of Directors

5IFǰ #PBSEǰ PGǰ %JSFDUPSTǰ JTǰ XFMMǰ BXBSFǰ PGǰ JUTǰ SPMFT ǰ EVUJFTǰ BOEǰ SFTQPOTJCJMJUJFTǰGPSǰEJSFDUJOHǰUIFǰ$PNQBOZĴTǰPQFSBUJPO ǰNPOJUPSJOHǰUIFǰ .BOBHFNFOUĴTǰ PQFSBUJPO ǰ QFSGPSNJOHǰ EVUJFTǰ XJUIǰ LOPXMFEHF ǰ competence, transparency, due care and accountability for the $PNQBOZǰ BOEǰ JUTǰ TIBSFIPMEFST ǰ BOEǰ CFJOHǰ JOEFQFOEFOUǰ PGǰ UIFǰ .BOBHFNFOUǰǰ)FSFǰBSFǰUIFǰLFZǰHVJEFMJOFTǰPOǰUIFǰ#PBSEĴTǰPQFSBUJPOT

Board Composition  ǰ ǰ ǰ ǰ ǰ

5IFǰ#PBSEǰPGǰ%JSFDUPSTǰEFUFSNJOFTǰUIFǰCPBSEǰDPNQPTJUJPOǰUIBUǰųUTǰ XJUIǰ UIFǰ $PNQBOZĴTǰ CVTJOFTTǰ TJ[F ǰ XIFSFCZǰ JUǰ JTǰ TFUǰ UPǰ CFǰ DPNQPTFEǰ PGǰ BUǰ MFBTUǰ ǰ NFNCFST ǰ OPUǰ MFTTǰ UIBOǰ ǰ PGǰ UIFǰEJSFDUPSTǰNVTUǰSFTJEFǰJOǰ5IBJMBOEǰBOEǰBUǰMFBTUǰǰPGǰXIPNǰ NVTUǰCFǰFYQFSJFODFEǰJOǰBDDPVOUJOHǰBOEǰųOBODFǰųFME

 ǰ 0Gǰ UIFǰ UPUBMǰ OVNCFSǰ PGǰ CPBSEǰ NFNCFST ǰ BUǰ MFBTUǰ ǰ BOEǰ ǰ OPǰGFXFSǰUIBOǰǰQFSTPOTǰNVTUǰCFǰJOEFQFOEFOUǰEJSFDUPST  ǰ 5IFǰ#PBSEǰPGǰ%JSFDUPSTǰNVTUǰCFǰQBSUJBMMZǰDPNQPTFEǰPGǰOPO executive directors so as to ensure checks and balances against ǰ UIFǰ FYFDVUJWFǰ EJSFDUPSTǰ BOEǰ Bǰ NJOJNVNǰ PGǰ ǰ PGǰ UIFǰ UPUBMǰ board members must be independent directors.

Qualifications of Directors 5IFǰ$PNQBOZǰIBTǰTQFDJųFEǰRVBMJųDBUJPOTǰPGǰUIFǰ#PBSEǰPGǰ%JSFDUPSTǰ BTǰGPMMPXT  ǰ .FFUJOHǰUIFǰRVBMJųDBUJPOTǰBOEǰOPUǰQPTTFTTJOHǰUIFǰQSPIJCJUFEǰ ǰ DIBSBDUFSJTUJDTǰQSFTDSJCFEǰJOǰUIFǰ1VCMJDǰ-JNJUFEǰ$PNQBOJFTǰ"DUǰ ǰ #&ǰǰPSǰPUIFSǰSFMBUFEǰMBXT ǰBTǰXFMMǰBTǰUIFǰSFHVMBUJPOTǰPGǰ ǰ 4&5ǰBOEǰ4&$ǰBOEǰUIFǰ$PNQBOZĴTǰ"SUJDMFTǰPGǰ"TTPDJBUJPOǰ  ǰ #FJOHǰBOǰFYQFSUǰXJUIǰLOPXMFEHF ǰDBQBCJMJUZǰBOEǰFYQFSJFODFǰUIBUǰ ǰ BSFǰCFOFųDJBMǰUPǰUIFǰ$PNQBOZĴTǰPQFSBUJPO  ǰ )BWJOHǰ Bǰ MFBEFSTIJQǰ TLJMM ǰ WJTJPOǰ BOEǰ JOEFQFOEFOUǰ EFDJTJPO ǰ NBLJOHǰBCJMJUZǰUPǰFOTVSFǰUIFǰNBYJNVNǰCFOFųUǰUPǰUIFǰ$PNQBOZǰ and the shareholders.  ǰ #FJOHǰSFTQPOTJCMFǰUPǰTFSWFǰBTǰUIFǰEJSFDUPSǰBOEǰBCMFǰUPǰTQBSFǰGVMMǰ time to perform the duty, assuming accountability to ǰ TIBSFIPMEFSTǰBOEǰEVUZǰPGǰDBSF ǰBOEǰQSPUFDUJOHǰUIFǰ$PNQBOZĴTǰ interests.  ǰ 1FSGPSNJOHǰEVUJFTǰXJUIǰJOUFHSJUZ ǰIPOFTUZ ǰFUIJDTǰBOEǰBEIFSFODFǰ to laws, good corporate governance principles, and code of business conduct.

Qualifications of Independent Directors 5IFǰ#PBSEǰPGǰ%JSFDUPSTǰEFUFSNJOFTǰRVBMJųDBUJPOTǰPGǰUIFǰJOEFQFOEFOUǰ EJSFDUPSTǰJOǰBMJHONFOUǰBOEǰDPNQMJBODFǰXJUIǰSFHVMBUJPOTǰ4&$ǰBOEǰ4&5 ǰ BTǰEFTDSJCFEǰVOEFSǰTFDUJPO ǰĶ4FMFDUJPOǰBOEǰ"QQPJOUNFOUǰPGǰ%JSFDUPSTǰ BOEǰ.BOBHFNFOUķ

Term of Office %JSFDUPSTǰTIBMMǰIPMEǰUIFǰUFSNǰPGǰPGųDFǰBTǰTUJQVMBUFEǰJOǰUIFǰ1VCMJDǰ-JNJUFEǰ $PNQBOJFTǰ"DUǰ#&ǰǰBOEǰUIFǰ$PNQBOZĴTǰ"SUJDMFTǰPGǰ"TTPDJBUJPO ǰ which reads “At each annual general meeting of shareholders, 1/3 of the directors, or if the number is not a multiple of 3, then the OVNCFSǰOFBSFTUǰUPǰ ǰNVTUǰSFUJSFǰGSPNǰPGųDFǰ5IFǰEJSFDUPSTǰXIPǰIBWFǰ CFFOǰUIFǰMPOHFTUǰJOǰPGųDFǰTIBMMǰSFUJSFǰųSTUǰǰ5IFǰSFUJSJOHǰEJSFDUPSTǰNBZǰ CFǰSFFMFDUFEķǰǰ5IFǰ/PNJOBUJPOǰBOEǰ3FNVOFSBUJPOǰ$PNNJUUFFǰXJMMǰ TFMFDUǰBOEǰOPNJOBUFǰRVBMJųFEǰQFSTPOTǰUPǰCFǰEJSFDUPSTǰUPǰUIFǰ#PBSEǰ PGǰ%JSFDUPSTǰCFGPSFǰTFFLJOHǰBQQSPWBMǰGSPNǰUIFǰTIBSFIPMEFSTĴǰNFFUJOH 5IFǰ#PBSEǰPGǰ%JSFDUPSTǰIBTǰTUJQVMBUFEǰUIBUǰNFNCFSTǰPGǰUIFǰ"VEJUǰ $PNNJUUFF ǰ /PNJOBUJPOǰ BOEǰ 3FNVOFSBUJPOǰ $PNNJUUFF ǰ 3JTLǰ .BOBHFNFOUǰ $PNNJUUFF ǰ BOEǰ $PSQPSBUFǰ (PWFSOBODFǰ BOEǰ &UIJDTǰ $PNNJUUFFǰTIBMMǰFBDIǰIBWFǰBǰUFSNǰPGǰPGųDFǰPGǰǰZFBSTǰBOEǰNBZǰCFǰ SFBQQPJOUFEǰBTǰEFFNFEǰųUǰCZǰUIFǰ#PBSEǰPGǰ%JSFDUPSTǰ"TǰGPSǰUIFǰ (SPVQǰ&YFDVUJWFǰ$PNNJUUFF ǰJUTǰNFNCFSTǰIBWFǰOPǰUFSNǰPGǰPGųDFǰBTǰ UIFǰ$PNNJUUFFĴTǰTUSVDUVSFǰDPNQPTFTǰPGǰFYFDVUJWFTǰJOǰUIFǰEFųOFEǰ positions.


175

New Director Orientation

Director and Management Development

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Title

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CDC

DAP

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Courses organized by other institutes

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FGP

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ANNUAL REPORT 2013

GMM GRAMMY

Training for Company Secretary "TǰPGǰ%FDFNCFSǰ ǰ ǰ.JTTǰ1BUDIBSBSBUǰ1BUDIBSBQVU ǰ)FBEǰ PGǰ 0GųDFǰ PGǰ $PSQPSBUFǰ 4FDSFUBSZǰ BOEǰ $PNQBOZǰ 4FDSFUBSZ ǰ BUUFOEFEǰTJYǰUSBJOJOHǰDPVSTFTǰPSHBOJ[FEǰCZǰ*0% ǰ %JSFDUPSTǰ$FSUJųDBUJPOǰ1SPHSBNǰ %$1

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Board of Directorsâ&#x20AC;&#x2122; Meetings

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with the external auditor without the presence of the management.

Merger and segregation of duties

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177

Independence of Board of Directors and Management 1 ǰ

Segregation of Chairman of the Board position and Group Chief &YFDVUJWFǰ0GųDFSǰQPTJUJPO

ǰ ǰ ǰ ǰ ǰ ǰ

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2

Balance of power

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most of them are appointed as directors of companies in the (SPVQǰJOǰBMMǰJUǰJTǰPGǰCFOFųUǰUPǰUIFǰ$PNQBOZ ǰOPUǰBGGFDUJOHǰUIFǰ performance of their respective duties and responsibilities.

Annual Self-Assessment 1.

The Board of Directors’ Self-assessment

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5IFǰ#PBSEǰPGǰ%JSFDUPSTǰSFHVMBSMZǰDPOEVDUTǰBǰZFBSMZǰ#PBSEǰTFMG assessment to be a framework to monitor the performance of UIFǰ EVUJFTǰ PGǰ UIFǰ #PBSEǰ *ODMVEJOHǰ SFDPOTJEFSǰ 1SPDFTTJOHǰ commentaries on various issues Related to the operations of the $PNQBOZǰ "OEǰ EVUJFTǰ PGǰ UIFǰ #PBSEǰ EVSJOHǰ UIFǰ QBTUǰ ZFBS ǰ Bǰ TVNNBSZǰPGǰUIFǰ$PNQBOZǰ4FDSFUBSZǰǰ"OEǰQSFTFOUǰUIFǰųOEJOHTǰUPǰ UIFǰ #PBSEǰ PGǰ %JSFDUPSTǰ 5Pǰ CFǰ VTFEǰ UPǰ FEJUǰ BOEǰ FOIBODFǰ performance.

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ǰ ǰ 5IFǰ #PBSEǰ PGǰ %JSFDUPSTǰ FOTVSFTǰ UIBUǰ JUǰ IBTǰ Bǰ QSPQFSǰ CPBSEǰ ǰ DPNQPTJUJPOǰ BOEǰ Bǰ EFųOJUFǰ TFHSFHBUJPOǰ PGǰ SPMFT ǰ EVUJFTǰ BOEǰ SFTQPOTJCJMJUJFTǰ CFUXFFOǰ UIFǰ #PBSEǰ PGǰ %JSFDUPSTǰ BOEǰ UIFǰ ǰ management. ǰ "MMǰCPBSEǰNFNCFSTǰIBWFǰUIFǰGSFFEPNǰPGǰDPOWFZJOHǰUIFJSǰPQJOJPOTǰ ǰ POǰUIFǰ$PNQBOZĴTǰPQFSBUJPOǰXJUIǰJOUFHSJUZǰBOEǰJOǰUIFǰCFTUǰJOUFSFTUǰ PGǰUIFǰ$PNQBOZǰBOEǰBMMǰTUBLFIPMEFSTǰBOEǰXJUIPVUǰCFJOHǰJOŴVFODFEǰ ǰ CZǰBOZǰQBSUZǰ5IFZǰBMTPǰBSFǰIFMEǰBDDPVOUBCMFǰGPSǰQFSGPSNJOHǰEVUZǰ ǰ JOǰBDDPSEBODFǰXJUIǰSFMFWBOUǰMBXT ǰUIFǰ$PNQBOZĴTǰ"SUJDMFTǰPGǰ "TTPDJBUJPO ǰBOEǰSFTPMVUJPOTǰPGǰUIFǰ#PBSEǰPGǰ%JSFDUPSTĴǰNFFUJOHǰ BOEǰUIFǰTIBSFIPMEFSTĴǰNFFUJOH

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"TǰPGǰ%FDFNCFSǰ ǰ ǰUIFǰ#PBSEǰPGǰ%JSFDUPSTǰXBTǰDPNQPTFEǰ PGǰǰRVBMJųFEǰNFNCFST ǰBTǰGPMMPXTǰ

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&YFDVUJWFǰEJSFDUPSTǰ

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/POFYFDVUJWFǰJOEFQFOEFOUǰEJSFDUPSTǰ ǰ QFSTPOT 3FQSFTFOUJOHǰǰPGǰUPUBMǰEJSFDUPST

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5. Relationship with the managementǰ team

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6. %JSFDUPSĴTǰQFSTPOBMǰEFWFMPQNFOUǰBOEǰ development of the management

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Directorship in Other Listed Companies 5IFǰ#PBSEǰPGǰ%JSFDUPSTǰIBTǰFTUBCMJTIFEǰBǰQPMJDZǰPOǰEJSFDUPSTIJQǰJOǰ PUIFSǰMJTUFEǰDPNQBOJFTǰBTǰGPMMPXT ǰ %JSFDUPSTIJQǰJOǰPUIFSǰMJTUFEǰDPNQBOZǰIFMEǰCZǰUIFǰ$PNQBOZĴTǰ directors ǰ ǰ ǰ ǰ ǰ

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&BDIǰEJSFDUPSǰJTǰBMMPXFEǰUPǰIPMEǰEJSFDUPSTIJQǰJOǰPUIFSǰMJTUFEǰ DPNQBOJFTǰOPUǰNPSFǰUIBOǰųWFǰMJTUFEǰDPNQBOJFT ǰJODMVTJWFǰ ǰ PGǰUIFǰ$PNQBOZ ǰUPǰFOTVSFǰUIFǰEJSFDUPSTĴǰFGųDJFODZǰBOEǰ ǰ TVGųDJFOUǰBMMPDBUJPOǰPGǰUJNFǰUPǰTFSWFǰPOǰUIFǰ$PNQBOZĴTǰ #PBSEǰPGǰ%JSFDUPST ǰ ǰ  ǰ %JSFDUPSTǰTIPVMEǰBWPJEǰIPMEJOHǰEJSFDUPSTIJQǰJOǰBOZǰPUIFSǰ ǰ ǰ ǰ MJTUFEǰDPNQBOZǰUIBUǰDPVMEǰDSFBUFǰBǰDPOŴJDUǰPGǰJOUFSFTUǰ ǰ ǰ XJUIǰUIFǰ$PNQBOZǰBOEǰJOǰQFSGPSNJOHǰUIFJSǰEVUZǰBTǰUIFǰ ǰ ǰ ǰ ǰ $PNQBOZĴTǰEJSFDUPS ǰ %JSFDUPSTIJQǰJOǰPUIFSǰMJTUFEǰDPNQBOZǰEJSFDUPSTIJQǰIFMEǰCZǰ ǰ ǰ ǰ $IJFGǰ&YFDVUJWFǰ0GųDFSǰBOEǰ5PQǰ.BOBHFNFOU ǰ ǰ 5IFǰ#PBSEǰPGǰ%JSFDUPSTǰBMMPXTǰUIFǰ(SPVQǰ$IJFGǰ&YFDVUJWFǰ0GųDFSǰ ǰ and top executives to take directorship in other companies and ǰ

5IFǰ #PBSEǰ TFMGBTTFTTNFOUǰ JTǰ EJWJEFEǰ JOUPǰ ųWFǰ SBOLJOHTǰ ǰǰ&YDFMMFOU ǰǰǰ7FSZǰ(PPE ǰǰǰ(PPE ǰǰǰ6OGBWPVSBCMF ǰ ǰǰ/FFETǰ*NQSPWFNFOU 5IFǰSBOLJOHǰSFTVMUTǰPGǰ#PBSEǰTFMGBTTFTTNFOU ǰCSPLFOǰEPXOǰJOUPǰ TJYǰDBUFHPSJFT ǰGPSǰǰXFSFǰBTǰTIPXOǰCFMPX Assessment Category (Board Assessment)

2013 Average Score

5IFǰ#PBSEǰPGǰ%JSFDUPSTĴǰBOOVBMǰǰTFMGBTTFTTNFOUǰTVNNBSZǰ JTǰBTǰGPMMPXT 4USVDUVSFǰBOEǰRVBMJųDBUJPOTǰPGǰUIFǰ#PBSEǰPGǰ%JSFDUPST 5IFǰOVNCFSǰPGǰEJSFDUPSTǰPOǰUIFǰ#PBSEǰXBTǰBQQSPQSJBUFǰGPSǰUIFǰ OBUVSFǰ PGǰ UIFǰ $PNQBOZĴTǰ CVTJOFTTǰ 5IFǰ #PBSEǰ DPNQSJTFEǰ individuals who are knowledgeable, competent and experienced, BOEǰ VOEFSTUBOEǰ UIFǰ CVTJOFTTǰ XFMMǰ 5IFǰ OVNCFSǰ PGǰ CPBSEǰ NFNCFSTǰXIPǰXFSFǰOPOFYFDVUJWFǰPSǰJOEFQFOEFOUǰEJSFDUPSTǰ XBTǰ BQQSPQSJBUFǰ UPǰ BMMPXǰ UIFǰ FGGFDUJWFOFTTǰ PGǰ UIFǰ #PBSEǰ 5IFǰOPNJOBUJPOǰQSPDFTTǰXBTǰGBJSǰBOEǰUSBOTQBSFOUǰ5IFǰ#PBSEǰXBTǰ TVQQPSUFEǰCZǰTVCDPNNJUUFFT ǰOBNFMZ ǰUIFǰ"VEJUǰ$PNNJUUFF ǰ (SPVQǰ &YFDVUJWFǰ $PNNJUUFF ǰ /PNJOBUJPOǰ BOEǰ 3FNVOFSBUJPOǰ $PNNJUUFF ǰ 3JTLǰ .BOBHFNFOUǰ $PNNJUUFF ǰ BOEǰ $PSQPSBUFǰ


178

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Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç°

ANNUAL REPORT 2013

GMM GRAMMY

(PWFSOBODFÇ°BOEÇ°&UIJDTÇ°$PNNJUUFFÇ°UIBUÇ°IBWFÇ°DMFBSMZEFMJOFBUFEÇ° SPMFTÇ°BOEÇ°SFTQPOTJCJMJUJFTÇ°5IFÇ°NFNCFSTÇ°PGÇ°UIPTFÇ°TVCDPNNJUUFFÇ° RVBMJųFEÇ° UPÇ° QFSGPSNÇ° UIFÇ° EVUJFTÇ° BTTJHOFEÇ° BOEPSÇ° EFųOFEÇ° CZÇ° Ç° UIFÇ°$IBSUFST Ç° 3PMFTÇ°BOEÇ°SFTQPOTJCJMJUJFTÇ°PGÇ°UIFÇ°#PBSEÇ°PGÇ°%JSFDUPST 5IFÇ° #PBSEÇ° PGÇ° %JSFDUPSTÇ° QBSUJDJQBUFEÇ° JOÇ° UIFÇ° TFUUJOHÇ° PGÇ° WJTJPO Ç° Ç° mission, strategy and goals, and consistently monitored and Ç° GPMMPXFEÇ° VQÇ° POÇ° UIFÇ° $PNQBOZÄ´TÇ° QFSGPSNBODFÇ° 5IFÇ° TDPQFÇ° PGÇ° BVUIPSJUZÇ°JOÇ°PQFSBUJOHÇ°BOEǰųOBODJBMÇ°EFDJTJPOÇ°QSPDFTTÇ°XFSFÇ°DMFBSMZÇ° TFUÇ°PVU Ç°FNQIBTJ[JOHÇ°UIFÇ°JNQPSUBODFÇ°PGÇ°BDDVSBUFǰųOBODJBMÇ°SFQPSUT Ç° BEFRVBDZÇ°PGÇ°JOGPSNBUJPOÇ°EJTDMPTVSF Ç°BWPJEBODFÇ°PGÇ°DPOÅ´JDUTÇ°PGÇ° interest and assurance that all transactions were conducted on BOÇ° BSNÄ´TÇ° MFOHUIÇ° CBTJT Ç° CFJOHÇ° JNQMFNFOUFEÇ° VOEFSÇ° BÇ° HJWFOÇ° QSPDFTTÇ°XJUIÇ°NPTUÇ°CFOFųDJBMÇ°UPÇ°UIFÇ°$PNQBOZ Ç°BTÇ°DMFBSMZÇ°EFųOFEÇ° JOÇ° UIFÇ° $PSQPSBUFÇ° "VUIPSJ[BUJPOÇ° *OEFYÇ° %JSFDUPSTÇ° XJUIÇ° WFTUFEÇ° interests were prohibited from voting on connected transactions. .PSFPWFS Ç°UIFÇ°#PBSEÇ°PGÇ°%JSFDUPSTÇ°NPOJUPSFEÇ°BOEÇ°FOTVSFEÇ°UIBUÇ° internal control and risk management systems were adequately QVUÇ° JOÇ° QMBDFÇ° BOEÇ° BQQSPQSJBUFÇ° GPSÇ° UIFÇ° $PNQBOZÄ´TÇ° OBUVSFÇ° PGÇ° CVTJOFTT Ç° UIFÇ° QSFQBSBUJPOÇ° PGÇ° ųOBODJBMÇ° TUBUFNFOUTÇ° XBTÇ° JOÇ° accordance with general accepted accounting standards, and FODPVSBHFEÇ°UIFÇ°$PNQBOZÇ°UPÇ°DPOUJOVPVTMZÇ°BCJEFÇ°CZÇ°UIFÇ°4&5Ç° BOEÇ°4&$Ä´TÇ°SVMFTÇ°BOEÇ°SFHVMBUJPOT Ç°BTÇ°XFMMÇ°BTÇ°UIFÇ°(PPEÇ°$PSQPSBUFÇ° (PWFSOBODFÇ°1PMJDZÇ°BOEÇ°UIFÇ°#VTJOFTTÇ°&UIJDTÇ°BOEÇ°$PEFÇ°PGÇ°$POEVDUÇ° .BOVBMÇ°PGÇ°(3"..:Ç°(SPVQÇ°3FHBSEJOHÇ°JOUFSOBMÇ°NBOBHFNFOU Ç°UIFÇ° criteria for evaluating the performance of the top management (SPVQÇ°$IJFGÇ°&YFDVUJWFÇ°0GųDFS Ç°XBTÇ°DMFBSMZÇ°TQFDJųFE Ç°BOEÇ°UIFÇ° remuneration was paid upon the result of the evaluation. Board of Directorsâ&#x20AC;&#x2122; meetings 5IFÇ°CPBSEÇ°NFFUJOHÇ°TDIFEVMFÇ°XBTÇ°QSFEFUFSNJOFEÇ°GPSÇ°BOÇ°FOUJSFÇ° year, thus allowing the director to properly allocate their time UPÇ°BUUFOEÇ°UIFÇ°NFFUJOHÇ°5IFÇ°NFFUJOHÇ°GSFRVFODZÇ°BOEÇ°EVSBUJPOÇ° XFSFÇ°DPOTJEFSFEÇ°BQQSPQSJBUFÇ°'PSÇ°FBDIÇ°NFFUJOH Ç°UIFÇ°EJSFDUPSTÇ° XFSFÇ°TVQQMJFEÇ°XJUIÇ°DPNQMFUFÇ°BOEÇ°TVGųDJFOUÇ°JOGPSNBUJPOÇ°GPSÇ°UIFJSÇ° EFDJTJPONBLJOHÇ° BOEÇ° XFSFÇ° BMMPXFEÇ° UPÇ° GSFFMZÇ° EJTDVTTFEÇ° BOEÇ° FYQSFTTFEÇ°QPTJUJWFÇ°PQJOJPOTÇ°XJUIPVUÇ°BOZÇ°QBSUZÄ´TÇ°JOUFSGFSFODFÇ° 1FSGPSNBODFÇ°BTÇ°BÇ°EJSFDUPS 5IFÇ° EJSFDUPSTÄ´Ç° NFFUJOHÇ° QBSUJDJQBUJPOÇ° XBTÇ° DPOTJTUFOUÇ° BOEÇ° TBUJTGBDUPSZÇ°CFUXFFOÇ°UIFÇ°MFWFMÇ°PGǰĶ(PPEÄ´Ç°UPǰĶ7FSZÇ°(PPEÄ·Ç°5IFJSÇ° expression of opinions was independent, unbiased and useful UPÇ°UIFÇ°$PNQBOZÄ´TÇ°PQFSBUJPO Ç°XIJMFÇ°SFTQFDUJOHÇ°EJGGFSFOUÇ°PQJOJPOTÇ° XJUIPVUÇ°BOZÇ°DPOÅ´JDUÇ°BNPOHÇ°UIFN Relationship with the management team 5IFÇ°#PBSEÇ°PGÇ°%JSFDUPSTÇ°IBEÇ°DPSEJBMÇ°SFMBUJPOTÇ°XJUIÇ°UIFÇ°NBOBHFNFOUÇ° BOEÇ°EJEÇ°OPUÇ°JOUFSGFSFÇ°XJUIÇ°UIFNÇ°XIJMFÇ°QFSGPSNJOHÇ°UIFJSÇ°EVUZÇ°Ç°"UÇ° UIFÇ° TBNFÇ° UJNF Ç° UIFÇ° #PBSEÇ° SFHVMBSMZÇ° GPMMPXFEÇ° VQÇ° POÇ° UIFÇ° NBOBHFNFOUÄ´TÇ°QFSGPSNBODFÇ°*OÇ°BEEJUJPO Ç°UIFÇ°#PBSEÇ°QBSUJDJQBUFEÇ° in determining appropriate solution in the case that the NBOBHFNFOUÄ´TÇ°QFSGPSNBDFÇ°XBTÇ°OPUÇ°JOÇ°MJOFÇ°XJUIÇ°UIFÇ°CVTJOFTTÇ° plan and budget.

Directorâ&#x20AC;&#x2122;s personal development and development of the Management "MMÇ° EJSFDUPSTÇ° XFMMÇ° VOEFSTUPPEÇ° UIFJSÇ° SPMFTÇ° BOEÇ° EVUJFT Ç° IBEÇ° BEFRVBUFÇ°LOPXMFEHFÇ°BOEÇ°DPNQSFIFOTJPOÇ°PGÇ°UIFÇ°$PNQBOZÄ´TÇ° business, and always kept abreast of crucial news and JOGPSNBUJPOÇ°SFMBUFEÇ°UPÇ°PSÇ°IBWJOHÇ°BOÇ°JNQBDUÇ°POÇ°UIFÇ°$PNQBOZÄ´TÇ° CVTJOFTTÇ°"MMÇ°EJSFDUPSTÇ°BSFÇ°TVQQPSUFEÇ°UISPVHIÇ°UPÇ°USBJOJOHÇ°DPVSTFEÇ° or seminars, as well as, plans to educate new directors in order to have a concrete understanding of the business of the $PNQBOZTPÇ°BTÇ°UPÇ°CFÇ°SFBEZÇ°UPÇ°QFSGPSNÇ°UIFJSÇ°EVUJFTÇ°FGGFDUJWFMZ *OÇ° Ç°UIFÇ°#PBSEÇ°PGÇ°%JSFDUPSTÇ°SFTPMWFEÇ°UPÇ°DPOEVDUÇ°BÇ°EJSFDUPSÄ´TÇ° TFMGBTTFTTNFOUÇ°JOÇ°BEEJUJPOÇ°UPÇ°UIFÇ°#PBSEÇ°BTTFTTNFOUÇ°UPÇ°GPMMPXÇ° UIFÇ° OFXÇ° QSJODJQBMTÇ° PGÇ° HPPEÇ° DPSQPSBUFÇ° HPWFSOBODFÇ° PGÇ° *0%Ç° 5IFÇ° EJSFDUPSÇ° TFMGBTTFTTNFOUÇ° JTÇ° EJWJEFEÇ° JOUPÇ° ųWFÇ° SBOLJOHTÇ° Ç°Ç°&YDFMMFOU Ç°Ç°Ç°7FSZÇ°(PPE Ç°Ç°Ç°(PPE Ç°Ç°Ç°6OGBWPVSBCMF Ç° Ç°Ç°/FFETÇ°*NQSPWFNFOU 5IFÇ°SBOLJOHÇ°SFTVMUTÇ°PGÇ°EJSFDUPSÇ°TFMGBTTFTTNFOU Ç°CSPLFOÇ°EPXOÇ° JOUPǰųWFÇ°DBUFHPSJFT Ç°GPSÇ°Ç°XFSFÇ°BTÇ°TIPXOÇ°CFMPX

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Assessment Category (Board Assessment) ǰ 2VBMJųDBUJPOT ǰLOPXMFEHF ǰBCJMJUZǰ



Ç° *OEFQFOEFODFÇ°



Ç° 1FSGPSNBODFÇ°BTÇ°BÇ°EJSFDUPSÇ°



Ç° "UUFOUJPOÇ°UPÇ°EVUZÇ°BOEÇ°SFTQPOTJCJMJUZÇ°



5. %JSFDUPSÄ´TÇ°QFSTPOBMÇ°EFWFMPQNFOUÇ°



Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç°

2013 Average Score

5IFǰ4VCDPNNJUUFFTĴǰ4FMGBTTFTTNFOU *Oǰ ǰUIFǰ#PBSEǰPGǰ%JSFDUPSTǰSFRVJSFEǰUIBUǰTFMGǰBTTFTTNFOUǰ BQQMZǰUPǰBMMǰ4VCDPNNJUUFFT ǰOBNFMZ ǰUIFǰ"VEJUǰ$PNNJUUFF ǰ 3JTLǰ.BOBHFNFOUǰ$PNNJUUFF ǰ$PSQPSBUFǰ(PWFSOBODFǰBOEǰ&UIJDTǰ $PNNJUUFF ǰ BOEǰ /PNJOBUJPOǰ BOEǰ 3FNVOFSBUJPOǰ $PNNJUUFFǰ GPSNFSMZǰUIJTǰBQQMJFEǰUPǰPOMZǰUIFǰ"VEJUǰ$PNNJUUFFǰ5IFǰTFMGǰ BTTFTTNFOUǰSFTVMUTǰXFSFǰSFQPSUFEǰUPǰUIFǰ#PBSEǰPGǰ%JSFDUPSTǰPOǰ Bǰ ZFBSMZǰ CBTJTǰ GPSǰ SFWJFXǰ PGǰ UIFǰ DPNNJUUFFTĴǰ QFSGPSNBODF ǰ including opinions on issues related to their performance of duties during the past year, with an aim to make improvements BOEǰFOIBODFǰXPSLǰFGųDJFODJFTǰ5IFǰQFSGPSNBODFǰBTTFTTNFOUǰ GPSNTǰXFSFǰEFUFSNJOFEǰBDDPSEJOHǰUPǰFBDIǰDPNNJUUFFĴTǰTDPQFǰ PGǰ EVUJFTǰ BOEǰ SFTQPOTJCJMJUJFTǰ 'PSǰ UIFǰ "VEJUǰ $PNNJUUFF ǰ UIFǰ QFSGPSNBODFǰ BTTFTTNFOUǰ XBTǰ BMTPǰ CBTFEǰ POǰ UIFǰ #FTUǰ 1SBDUJDFǰ(VJEFMJOFTǰGPSǰ"VEJUǰ$PNNJUUFF ǰEFWFMPQFEǰCZǰUIFǰ4&5 ǰ UIFǰ5IBJǰ*OTUJUVUFǰPGǰ%JSFDUPSTǰ *0% ǰBOEǰDPNQBOJFTǰXJUIǰHPPEǰ ratings on good corporate governance, where applicable to the $PNQBOZ *Oǰ ǰBMMǰUIFǰ4VCDPNNJUUFFTǰQFSGPSNFEǰUIFJSǰEVUJFTǰXFMMǰ with knowledge and abilities in accordance with the scopes of duties and responsibilities given in their respective charters


179

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3FTVMUTǰ PGǰ UIFǰ /PNJOBUJPOǰ BOEǰ 3FNVOFSBUJPOǰ $PNNJUUFFĴT TFMGBTTFTTNFOU

BOEǰ MJOFǰ XJUIǰ UIFǰ SFHVMBUPSĴTǰ CFTUǰ QSBDUJDFǰ HVJEFMJOFTǰ 5IFǰ $PNQBOZǰ 4FDSFUBSZǰ TVNNBSJ[FEǰ UIFǰ SFTVMUTǰ PGǰ FBDIǰ 4VCDPNNJUUFFĴTǰQFSGPSNBODFǰBTTFTTNFOUǰGPSǰTVCNJTTJPOǰUPǰ UIFǰ#PBSEǰPGǰ%JSFDUPSTǰBUǰUIFǰ#PBSEĴTǰ.FFUJOHǰ/PǰPOǰ 'FCSVBSZǰ ǰǰ5IFǰ4VC$PNNJUUFFTǰBTTFTTNFOUǰJTǰEJWJEFEǰ JOUPǰ ųWFǰ SBOLJOHTǰ ǰ ǰ &YDFMMFOU ǰ ǰ ǰ 7FSZǰ (PPE ǰ ǰ ǰ (PPE ǰ ǰǰ6OGBWPVSBCMF ǰǰǰ/FFETǰ*NQSPWFNFOU

Assessment Category ǰ 4USVDUVSFǰBOEǰRVBMJųDBUJPOǰPGǰUIFǰ member

2013 Average Score ǰ ǰ

ǰ Role, duty and responsibility 3FTVMUTǰPGǰUIFǰ"VEJUǰ$PNNJUUFFĴTǰTFMGBTTFTTNFOU Assessment Category

2013 Average Score

ǰ 4USVDUVSFǰBOEǰRVBMJųDBUJPOTǰPGǰUIFǰ member

ǰ ǰ

ǰ 5FSNǰPGǰUIFǰQPTJUJPOǰ



ǰ Scope of responsibilityǰ



ǰ 1PXFSǰUPǰQFSGPSNǰUIFǰEVUZǰ



5. Meetingsǰ

ǰǰ

3FTVMUTǰPGǰUIFǰ3JTLǰ.BOBHFNFOUǰ$PNNJUUFFĴTǰTFMGBTTFTTNFOU Assessment Category

2013 Average Score

ǰ 4USVDUVSFǰBOEǰRVBMJųDBUJPOǰPGǰUIFǰ member

ǰ ǰ

ǰ Role, duty and responsibilityǰ



ǰ Meetingsǰ



ǰ 1FSGPSNBODFǰPOǰEVUZǰ



5. 1FSTPOBMǰEFWFMPQNFOUǰ

ǰǰǰ

ǰ

ǰ%JSFDUPSǰOPNJOBUJPOǰǰUPQǰFYFDVUJWFǰ performance assessment

ǰ ǰ

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ǰ%FUFSNJOBUJPOǰPGǰ3FNVOFSBUJPOǰ



ǰ Meetingsǰ



ǰ 1FSGPSNBODFǰPOǰEVUZǰ



5. 1FSTPOBMǰEFWFMPQNFOUǰ

ǰǰǰǰǰǰ

ǰ ǰ ǰ ǰ ǰ ǰ ǰ ǰ ǰ ǰ ǰ ǰ ǰ

ǰ 3FTVMUTǰPGǰUIFǰ$PSQPSBUFǰ(PWFSOBODFǰBOEǰ&UIJDTǰ$PNNJUUFFĴTǰ ǰ ǰ TFMGBTTFTTNFOU ǰ Assessment Category 2013 Average Score ǰ ǰ ǰ 4USVDUVSFǰBOEǰRVBMJųDBUJPOǰPGǰUIFǰ ǰ ǰ ǰ member ǰ ǰ Role, duty and responsibilityǰ  ǰ ǰ Meetingsǰ  ǰ ǰ 1FSGPSNBODFǰPOǰEVUZǰ  ǰ ǰ 5. 1FSTPOBMǰEFWFMPQNFOUǰ ǰǰ ǰ ǰ

(SPVQǰ$IJFGǰ&YFDVUJWFǰ0GųDFSĴTǰ"TTFTTNFOU 5IFǰ #PBSEǰ PGǰ %JSFDUPSTǰ IBTǰ BTTJHOFEǰ UIFǰ /PNJOBUJPOǰ BOEǰ 3FNVOFSBUJPOǰ$PNNJUUFFǰUPǰFWBMVBUFǰUIFǰQFSGPSNBODFǰPGǰUIFǰ UPQǰFYFDVUJWFǰJOǰUIFǰPSHBOJ[BUJPOĴTǰTUSVDUVSFǰ (SPVQǰ$&0 ǰPOǰ a yearly basis, for use as a guide in determining the top FYFDVUJWFĴTǰSFNVOFSBUJPOǰBOEǰTVCNJUǰUIFǰSFTVMUǰPGǰUIFǰFWBMVBUJPOǰ UPǰBǰNFFUJOHǰPGǰUIFǰ#PBSEǰPGǰ%JSFDUPSTǰGPSǰBDLOPXMFEHFNFOUǰ and approval. *Oǰ ǰUIFǰ/PNJOBUJPOǰBOEǰ3FNVOFSBUJPOǰ$PNNJUUFFǰBHSFFEǰ to improve the evaluation form of the performance of Group $&0ǰUPǰTVJUǰUIFǰDVSSFOUǰTJUVBUJPO ǰCBTFEǰPOǰUIFǰFWBMVBUJPOǰGPSNǰ PGǰ UIFǰ QFSGPSNBODFǰ PGǰ UIFǰ UPQǰ FYFDVUJWFǰ PGǰ UIFǰ $PSQPSBUFǰ (PWFSOBODFǰ$FOUFS ǰ5IFǰ4UPDLǰ&YDIBOHFǰPGǰ5IBJMBOEǰ 5IFǰ(SPVQǰ$IJFGǰ&YFDVUJWFǰ0GųDFSǰBTTFTTNFOUǰJTǰEJWJEFEǰJOUPǰ ųWFǰSBOLJOHTǰǰǰ1FSGPSNFEǰFYDFMMFOUMZ ǰǰǰ1FSGPSNFEǰWFSZǰXFMM ǰ ǰǰ1FSGPSNFEǰSFBTPOBCMZ ǰǰǰ1FSGPSNFEǰQBSUJBMMZ ǰǰǰ/PUǰZFUǰ performed. 5IFǰ PWFSBMMǰ BTTFTTNFOU ǰ XJUIǰ UPUBMǰ TDPSFTǰ PGǰ  ǰ DBOǰ CFǰ DMBTTJųFEǰJOUPǰųWFǰMFWFMT .PSFǰUIBOǰǰ ǰ &YDFMMFOU ǰǰǰ ǰ ǰ 7FSZǰ(PPE ǰǰǰ ǰ ǰ (PPE ǰǰǰ ǰ ǰ 'BJS #FMPXǰǰ ǰ ǰ /FFETǰ*NQSPWFNFOU *Oǰ ǰUIFǰ/PNJOBUJPOǰBOEǰ3FNVOFSBUJPOǰ$PNNJUUFFǰSFQPSUFEǰ UPǰUIFǰ#PBSEǰPGǰ%JSFDUPSTĴǰNFFUJOHǰ/Pǰ ǰIFMEǰPOǰ'FCSVBSZǰ  ǰ ǰUIBUǰĶ'SPNǰUIFǰPWFSBMMǰBTTFTTNFOUǰPGǰ.JTTǰ#PPTBCBǰ %BPSVFOH ǰUIFǰ(SPVQǰ$IJFGǰ&YFDVUJWFǰ0GųDFSǰGPSǰǰCZǰUIFǰ UISFFNFNCFSǰ /PNJOBUJPOǰ BOEǰ 3FNVOFSBUJPOǰ $PNNJUUFF ǰ UIFǰ(SPVQǰ$IJFGǰ&YFDVUJWFǰ0GųDFSǰXBTǰSBUFEǰĶ7FSZǰ(PPEķ ǰPSǰ FRVJWBMFOUǰUPǰUIFǰBWFSBHFǰTDPSFǰPGǰķ


180

ANNUAL REPORT 2013

GMM GRAMMY

1. 5IFǰ#PBSEǰPGǰ%JSFDUPSTǰTFFTǰUIFǰJNQPSUBODFǰBOEǰOFFEǰUPǰTVQQPSUǰ ǰ UIFǰEFWFMPQNFOUǰPGǰBǰTVDDFTTJPOǰQMBOǰGPSǰUIFǰUPQǰFYFDVUJWF ǰ$IJFGǰ ǰ &YFDVUJWFǰ0GųDFSǰBOEPSǰPUIFSǰLFZǰNBOBHFNFOUǰQPTJUJPOT ǰXIJDIǰJTǰ QBSUǰPGǰUIFǰ$PNQBOZĴTǰIVNBOǰSFTPVSDFTǰNBOBHFNFOUǰTUSBUFHZǰǰ5IFǰ %FWFMPQNFOUǰQMBOOJOHǰPGǰUBMFOUFEǰQFSTPOOFMǰJTǰBJNFEǰUPǰDPQFǰXJUIǰ ǰ any unexpected incapability or vacancy of those key positions to ǰ ǰ ensure uninterrupted operation. ǰ Sub-Committees ǰ 5IFǰ #PBSEǰ PGǰ %JSFDUPSTǰ IBTǰ BQQPJOUFEǰ WBSJPVTǰ TVCDPNNJUUFFTǰ ǰ UPǰIFMQǰTDSFFOǰDSVDJBMǰJTTVFTǰXJUIǰEVFǰDBSFǰBOEǰFGųDJFODZǰ5IFTFǰ DPNNJUUFFTǰIPMEǰNFFUJOHTǰBOEǰSFQPSUǰUIFJSǰųOEJOHTǰUPǰUIFǰ#PBSEǰ ǰ PGǰ %JSFDUPSTǰ GPSǰ BDLOPXMFEHFNFOU ǰ BQQSPWBMǰ PSǰ DPOTJEFSBUJPO ǰ BTǰ ǰ the case may be, on a regular basis and report their performance ǰ GPSǰUIFǰTIBSFIPMEFSTĴǰJOGPSNBUJPOǰJOǰUIFǰBOOVBMǰSFQPSUǰ5IJTǰIFMQTǰ ǰ UPǰTVQQPSUǰBOEǰFOBCMFTǰUIFǰ$PNQBOZĴTǰPWFSBMMǰPQFSBUJPOǰUPǰBUUBJOǰ ǰ the established goals and comply with good corporate governance ǰ QSJODJQMFTǰ5IFǰ#PBSEǰPGǰ%JSFDUPSTǰIBTǰBQQSPWFEǰUIFǰDIBSUFSǰPGǰFBDIǰ ǰ committee, clearly stipulating therein the committee objectives, RVBMJųDBUJPOT ǰDPNQPTJUJPO ǰUFSNǰPGǰPGųDF ǰTDPQFǰPGǰQPXFS ǰEVUZǰBOEǰ ǰ SFTQPOTJCJMJUZ ǰSFQPSUJOHǰBOEǰNFFUJOHTǰ5IFǰDIBSUFSǰPGǰFBDIǰDPNNJUUFFǰ ǰ will be reviewed from time to time to ensure its appropriateness and ǰ JTǰQPTUFEǰPOǰUIFǰ$PNQBOZĴTǰ8FCTJUFǰ5IFSFǰBSFǰǰTVCDPNNJUUFFTǰ BTǰGPMMPXT ǰ

Succession Plans

Ç° Ç° Ç°

Name

Title

Audit Committee 5IFǰ "VEJUǰ $PNNJUUFFĴTǰ DPNQPTJUJPOǰ BOEǰ RVBMJųDBUJPOTǰ GVMMZǰ DPOGPSNǰUPǰUIFǰ4&5ǰBOEǰ4&$ĴTǰHVJEFMJOFTǰ*UǰJTǰDPNQPTFEǰPGǰOPǰ fewer than three independent directors, at least one of whom has knowledge and understanding or experience in accounting PSǰųOBODFǰųFMEǰTVGųDJFOUǰGPSǰSFWJFXJOHǰBǰųOBODJBMǰTUBUFNFOUǰ 5IFǰDPNNJUUFFǰNFNCFSTǰIBWFǰUFOVSFǰPGǰUISFFǰZFBSTǰBOEǰNBZǰ CFǰSFBQQPJOUFEǰBTǰEFFNFEǰųUǰCZǰUIFǰ#PBSEǰPGǰ%JSFDUPST 5IFǰ "VEJUǰ $PNNJUUFFǰ IPMETǰ PSǰ DBMMTǰ Bǰ NFFUJOHǰ BTǰ EFFNFEǰ BQQSPQSJBUFǰ BUǰ MFBTUǰ PODFǰ FWFSZǰ RVBSUFSǰ GPVSǰ UJNFTǰ Bǰ ZFBS ǰ 5IFǰ NFFUJOHǰ BHFOEBǰ JTǰ DMFBSMZǰ QSFEFUFSNJOFEǰ 3FMFWBOUǰ documents are delivered in advance to the committee members BOEǰPUIFSǰBUUFOEFFTǰUPǰBMMPXǰUIFNǰTVGųDJFOUǰUJNFǰUPǰDPOTJEFSǰ UIFǰJTTVFTǰPSǰSFRVFTUǰBEEJUJPOBMǰJOGPSNBUJPOǰ5IFǰBHFOEBǰDPWFSTǰ BMMǰNBUUFSTǰBTǰBTTJHOFEǰCZǰUIFǰ#PBSEǰPGǰ%JSFDUPSTǰBOEǰBTǰSFRVJSFEǰ CZǰMBXTǰBOEPSǰSFHVMBUJPOTǰPGǰUIFǰSFHVMBUPSǰCPEJFT 5IFǰ "VEJUǰ $PNNJUUFFǰ QFSGPSNTǰ EVUJFTǰ BTǰ EFTJHOBUFEǰ CZǰ UIFǰ #PBSEǰPGǰ%JSFDUPSTǰBOEǰXJUIJOǰUIFǰQVSWJFXǰPGǰQPXFS ǰEVUJFTǰBOEǰ SFTQPOTJCJMJUJFTǰEFųOFEǰJOǰUIFǰ"VEJUǰ$PNNJUUFFǰ$IBSUFS ǰXIJDIǰ is in conformity with the scope of main activities prescribed by UIFǰSFHVMBUPSǰCPEJFTǰ5IFǰ$PNQBOZǰIBTǰBǰQPMJDZǰUPǰEJTTFNJOBUFǰ UIFǰ$PNQBOZĴTǰ"VEJUǰ$PNNJUUFFǰ$IBSUFSǰUISPVHIǰUIFǰ(3"..:ǰ (SPVQĴTǰ*OUSBOFUǰUPǰFOTVSFǰJUǰJTǰDPNNVOJDBUFEǰUPǰBMMǰQFPQMFǰ across the organization. "TǰPGǰ%FDFNCFSǰ ǰ ǰUIFǰ"VEJUǰ$PNNJUUFFǰDPNQSJTFEǰǰ JOEFQFOEFOUǰEJSFDUPSTǰXIPǰQPTTFTTFEǰRVBMJųDBUJPOTǰBTǰSFRVJSFEǰ CZǰ4&5ǰBOEǰ4&$ǰ*Oǰ ǰUIFǰ"VEJUǰ$PNNJUUFFǰIFMEǰBǰUPUBMǰPGǰ ǰOPSNBMǰNFFUJOHTǰ.FNCFSTǰPGǰUIFǰDPNNJUUFF ǰBQQPJOUNFOUǰ term, and their attendance at the meeting are as follows Term

Meeting Attendance (Times)

Ç°%SÇ°/BSJTÇ°

$IBJZBTPPU=Ç°Ç°

$IBJSNBOÇ°Ç°

+VOÇ° Ç°Ç°Ç°+VOÇ° Ç°Ç°



Ç°.SÇ°%FKÇ°

#VMTVL=Ç°

.FNCFSÇ°Ç°

+VOÇ° Ç°Ç°Ç°+VOÇ° Ç°Ç°



Ç°.SÇ°8FFSBXPOHÇ°$IJUUNJUUSBQBQ=Ç° .FNCFSÇ°

+VOÇ° Ç°Ç°Ç°+VOÇ° Ç°Ç°



Ç°.TÇ°4VWBCIBÇ° $IBSPFOZJOH Ç°

.FNCFSÇ°

"QSÇ° Ç°Ç°Ç°"QSÇ° Ç°Ç°



Ç° .SÇ°8JDIBJÇ°

4FDSFUBSZÇ°

Ç°



$IBJSNBOÇ°Ç°

&OEFEÇ°POÇ°'FCSVBSZÇ° Ç°Ç°



=

Ç° .SÇ°$IBJÇ° Note: Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç°

4BOUBEBOVXBUÇ° /BTZMWBOUBÇ°

"EEJUJPOBMǰJOGPSNBUJPOǰBOEǰDIBOHFTǰEVSJOHǰUIFǰZFBSǰ =ǰ 5IFǰ#PBSEǰPGǰ%JSFDUPSTĴǰ.FFUJOHǰ/PǰIFMEǰPOǰ+VMZǰ ǰǰBQQPJOUFEǰ%Sǰ/BSJTǰ$IBJZBTPPU ǰ.S%FKǰ#VMTVL ǰBOEǰ.S8FFSBXPOHǰ$IJUUNJUUSBQBQǰBTǰ ǰ NFNCFSTǰPGǰUIFǰ"VEJUǰ$PNNJUUFFǰGPSǰBOPUIFSǰUFSNǰ .Sǰ/BSJTǰ$IBJZBTPPUǰXBTǰBQQPJOUFEǰ$IBJSNBOǰPGǰUIFǰ"VEJUǰ$PNNJUUFFǰUPǰSFQMBDFǰUIFǰSFTJHOFEǰEJSFDUPS ǰ ǰ .Sǰ$IBJǰ/BTZMWBOUB ǰBDDPSEJOHǰUPǰUIFǰ#PBSEǰPGǰ%JSFDUPSTĴǰ.FFUJOHǰ/P ǰFGGFDUJWFǰ.BSDIǰ ǰǰPGǰXIJDIǰIJTǰUFSNǰXBTǰEVFǰPOǰ+VOFǰ ǰ =ǰ %Sǰ/BSJTǰ$IBJZBTPPUǰBOEǰ.Tǰ4VWBCIBǰ$IBSPFOZJOHǰBSFǰUIFǰNFNCFSTǰPGǰUIFǰ"VEJUǰ$PNNJUUFFǰXIPǰBSFǰLOPXMFEHFBCMFǰBOEǰFYQFSJFODFEǰJOǰųOBODJBMǰ statement review.


181

Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç°

5IFǰ"VEJUǰ$PNNJUUFFǰIBEǰQFSGPSNFEǰJUTǰEVUZǰLOPXMFEHFBCMZǰ and to the best of its ability, within its scope of authority in BDDPSEBODFǰ XJUIǰ UIFǰ "VEJUǰ $PNNJUUFFǰ $IBSUFSǰ BOEǰ HPPEǰ DPSQPSBUFǰ HPWFSOBODFǰ GPSǰ "VEJUǰ $PNNJUUFFTǰ 5IFǰ NFFUJOHǰ minutes have been duly recorded and endorsed by the members PGǰUIFǰ$PNNJUUUFF ǰJOǰSFBEJOFTTǰGPSǰJOTQFDUJPOǰCZǰBOZǰNFNCFSǰ PGǰUIFǰ$PNNJUUFFǰBOEǰSFMBUFEǰQFSTPOOFM %VUJFTǰBOEǰ3FTQPOTJCJMJUJFTǰPGǰUIFǰ"VEJUǰ$PNNJUUFF ǰ &OTVSJOHǰUIFǰBDDVSBDZ ǰDPNQMFUFOFTT ǰBOEǰSFMJBCJMJUZǰPGǰUIFǰ ǰ ųOBODJBMǰ TUBUFNFOUTǰ BOEǰ UIBUǰ TVGųDJFOUǰ JOGPSNBUJPOǰ JTǰ disclosed. ǰ &OTVSJOHǰUIBUǰUIFǰ$PNQBOZǰIBTǰTVGųDJFOU ǰBQQSPQSJBUFǰBOEǰ effective internal controls, risk management, and internal audit systems. ǰ &OTVSJOHǰUIBUǰUIFǰ$PNQBOZǰBQQSPQSJBUFMZǰBOEǰFGGFDUJWFMZǰ ǰ BCJEFTǰ CZǰ UIFǰ (PPEǰ $PSQPSBUFǰ (PWFSOBODFǰ 1PMJDZǰ BOEǰ ǰ $PEFǰPGǰ&UIJDT ǰ &OTVSJOHǰUIBUǰUIFǰ$PNQBOZǰBCJEFTǰCZǰBMMǰSFMFWBOUǰ4&$ǰBOEǰ ǰ 4&5ǰSVMFTǰBOEǰSFHVMBUJPOT ǰBOEǰPUIFSǰSFHVMBUJPOTǰBOEǰMBXTǰ ǰ SFMBUFEǰUPǰUIFǰ$PNQBOZĴTǰCVTJOFTTFT ǰ 4FMFDUJOHǰ BOEǰ QSPQPTFǰ UIFǰ $PNQBOZĴTǰ BVEJUPSTǰ BOEǰ determine their compensation. ǰ &WBMVBUJOHǰDPOOFDUFEǰUSBOTBDUJPOTǰTPǰUIFZǰDPNQMZǰXJUIǰ ǰ UIFǰMBXǰBOEǰSFHVMBUJPOTǰTUJQVMBUFEǰCZǰ4&5 ǰBOEǰUIBUǰUIFǰ ǰ USBOTBDUJPOTǰBSFǰSFBTPOBCMFǰBOEǰCFOFųUǰUIFǰ$PNQBOZ ǰ 4VQFSWJTJOHǰUIFǰ*OUFSOBMǰ"VEJUǰ6OJUǰQPMJDJFTǰBOEǰPQFSBUJPOTǰ ǰ TPǰUIBUǰUIFZǰBSFǰBMJHOFEǰXJUIǰUIFǰ*OUFSOBMǰ"VEJUǰ$IBSUFS ǰ by evaluating the independence of its audits, the scope of work and audit schedules. ǰ &WBMVBUJOHǰBOEǰBQQPJOU ǰUSBOTGFS ǰBOEǰUFSNJOBUFǰUIFǰIFBEǰ ǰ PGǰ *OUFSOBMǰ "VEJUǰ %FQBSUNFOU ǰ BTǰ XFMMǰ BTǰ BTTFTTǰ UIFǰ ǰ QFSGPSNBODFǰPGǰUIFǰIFBEǰPGǰ*OUFSOBMǰ"VEJUǰ%FQBSUNFOUǰ ǰ BOEǰ BQQSPWFǰ DPNQFOTBUJPOǰ GPSǰ UIFǰ *OUFSOBMǰ "VEJUǰ ǰ %FQBSUNFOU ǰ BTǰ JOJUJBMMZǰ BQQSBJTFEǰ CZǰ UIFǰ (SPVQǰ $IJFGǰ ǰ &YFDVUJWFǰ0GųDFS 9. Reviewing both the external and internal audit and ǰ SFDPNNFOEBUJPOTǰDPOEVDUFEǰCZǰUIFǰFYUFSOBMǰ"VEJUPSǰBOEǰ ǰ UIFǰ *OUFSOBMǰ "VEJUǰ %FQBSUNFOU ǰ BTǰ XFMMǰ BTǰ NPOJUPSǰ UIFǰ management team to ensure that recommendations have ǰ CFFOǰTVGųDJFOUMZǰGPMMPXFEǰBOEǰFGGFDUJWFǰBDUJPOǰIBTǰCFFOǰ taken within an appropriate timeframe.

Ç°

Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° 2. Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç°

ǰ 5IFǰ"VEJUǰ$PNNJUUFFǰDBOǰSFRVFTUǰUIBUǰBOZǰNFNCFSǰPGǰ the management or any employee to report or present information, attend meetings or deliver documents as deemed relevant and necessary. ǰ 5IFǰ"VEJUǰ$PNNJUUFFǰDBOǰSFRVFTUǰBTTJTUBODFǰGSPNǰFYUFSOBMǰ ǰ BEWJTPSTǰPSǰFYQFSUTǰSFMBUFEǰUPǰUIFǰ"VEJU ǰBUǰUIFǰ$PNQBOZĴTǰ ǰ FYQFOTF ǰJOǰBDDPSEBODFǰXJUIǰUIFǰ$PNQBOZĴTǰ"SUJDMFTǰPGǰ ǰ "TTPDJBUJPO ǰBTǰOFDFTTBSZǰ ǰ $POTJEFSJOHǰBOEǰBNFOEJOHǰUIFǰ"VEJUǰ$PNNJUUFFǰ$IBSUFSǰ ǰ BUǰMFBTUǰPODFǰBǰZFBSǰPSǰBTǰOFDFTTBSZ ǰTPǰJUǰJTǰVQUPEBUFǰ ǰ BOEǰBQQSPQSJBUFǰUPǰUIFǰ$PNQBOZĴTǰFOWJSPONFOU ǰBOEǰUPǰ ǰ QSFTFOUǰUIFǰSFTVMUTǰUPǰUIFǰ#PBSEǰPGǰ%JSFDUPSTǰGPSǰBQQSPWBM ǰ 1SFQBSJOHǰBOǰ"VEJUǰ$PNNJUUFFĴTǰ3FQPSU ǰBUUBDIFEǰJOǰUIFǰ ǰ $PNQBOZĴTǰBOOVBMǰSFQPSU ǰTJHOFEǰCZǰUIFǰ$IBJSNBOǰPGǰUIFǰ ǰ "VEJUǰ$PNNJUUFF ǰ &YFDVUJOHǰPUIFSǰUBTLTǰBTǰBTTJHOFEǰCZǰUIFǰ#PBSEǰPGǰ%JSFDUPST ǰ ǰ BTǰBHSFFEǰUPǰCZǰUIFǰ"VEJUǰ$PNNJUUFFǰ Nomination and Remuneration Committee 5IFǰ/PNJOBUJPOǰBOEǰ3FNVOFSBUJPOǰ$PNNJUUFFǰJTǰDPNQPTFEǰPGǰ BUǰMFBTUǰǰNFNCFST ǰBǰNBKPSJUZǰPGǰXIPNǰ NPSFǰUIBOǰIBMGǰPGǰ UIFǰUPUBMǰNFNCFST ǰNVTUǰCFǰJOEFQFOEFOUǰEJSFDUPSTǰXJUIǰPOFǰPGǰ UIFNǰ TFSWJOHǰ BTǰ UIFǰ DPNNJUUFFǰ DIBJSNBOǰ 5IFǰ DPNNJUUFFǰ DPNQPTJUJPOǰJTǰSFHVMBSMZǰSFWJFXFEǰUPǰųUǰXJUIǰUIFǰ$PNQBOZĴTǰ organization structure and nature of business. 5IFǰ/PNJOBUJPOǰBOEǰ3FNVOFSBUJPOǰ$PNNJUUFFǰIPMETǰPSǰDBMMTǰ a meeting as deemed appropriate at least once a year and has UIFǰQPXFSǰUPǰBEEJUJPOBMMZǰDBMMǰBǰNFFUJOHǰBTǰEFFNFEǰųU 5IFǰ/PNJOBUJPOǰBOEǰ3FNVOFSBUJPOǰ$PNNJUUFFǰQFSGPSNTǰEVUJFTǰ BTǰEFTJHOBUFEǰCZǰUIFǰ#PBSEǰPGǰ%JSFDUPSTǰBOEǰXJUIJOǰUIFǰQVSWJFXǰ PGǰQPXFS ǰEVUJFTǰBOEǰSFTQPOTJCJMJUJFTǰEFųOFEǰJOǰUIFǰ/PNJOBUJPOǰ BOEǰ 3FNVOFSBUJPOǰ $PNNJUUFFǰ $IBSUFSǰ 5IFǰ $PNQBOZǰ IBTǰ Bǰ QPMJDZǰ UPǰ EJTTFNJOBUFǰ UIFǰ $PNQBOZĴTǰ /PNJOBUJPOǰ BOEǰ 3FNVOFSBUJPOǰ$PNNJUUFFǰ$IBSUFSǰUISPVHIǰUIFǰ(3"..:ǰ(SPVQĴTǰ *OUSBOFUǰUPǰFOTVSFǰJUǰJTǰDPNNVOJDBUFEǰUPǰBMMǰQFPQMFǰBDSPTTǰUIFǰ organization. "TǰPGǰ%FDFNCFSǰ ǰ ǰUIFǰ/PNJOBUJPOǰBOEǰ3FNVOFSBUJPOǰ $PNNJUUFFĴTǰǰSFQVUBCMFǰNFNCFSTǰDPNQSJTFEǰǰ%JSFDUPSǰBOEǰ ǰ *OEFQFOEFOUǰ %JSFDUPSTǰ *Oǰ  ǰ UIFǰ /PNJOBUJPOǰ BOEǰ 3FNVOFSUJPOǰ $PNNJUUFFǰ .FFUJOHǰ NFUǰ Bǰ UPUBMǰ PGǰ ǰ UJNFTǰǰ Members of the committee and their attendance at the meeting BSFǰBTǰGPMMPXT


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ANNUAL REPORT 2013

GMM GRAMMY

Name

Title

Term

Meeting Attendance (Times)

Ç°.SÇ°%FKÇ°

#VMTVLÇ°

$IBJSNBOÇ°

+VMÇ° Ç°Ç°Ç°+VMÇ° Ç°

Ç° Ç°

Ç°%SÇ°/BSJTÇ°

$IBJZBTPPU=Ç°

.FNCFSÇ°

.BSÇ° Ç°Ç°Ç°+VMÇ° Ç°Ç°



Ç°.SÇ°1BJCPPOÇ° %BNSPOHDIBJUIBNÇ° .FNCFSÇ°

+VMÇ° Ç°Ç°Ç°+VMÇ° Ç°Ç°



.FNCFSÇ°

&OEFEÇ°POÇ°'FCÇ° Ç°Ç°



4FDSFUBSZÇ°

Ç°

Ç°

Ç° .SÇ°$IBJÇ°

/BTZMWBOUBÇ°

Ç° .STÇ°+JSBQPSOÇ° 3VOHTSJUIPOHÇ°Ç° Note: Ç° Ç° Ç° Ç°

Ç° Ç° Ç° Ç° Ç°

Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç°

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Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç°

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CFOFųUTǰFYQFDUFEǰJOǰSFUVSOǰGSPNǰFBDIǰEJSFDUPSǰ5IFǰSFQPSUǰ XJMMǰCFǰTVCNJUUFEǰUPǰUIFǰ#PBSEǰPGǰ%JSFDUPSTǰGPSǰDPOTFOUǰ BOEǰUPǰUIFǰ4IBSFIPMEFSTĴǰ.FFUJOHǰGPSǰBQQSPWBM 5BLJOHǰ SFTQPOTJCJMJUZǰ UPǰ TVQQPSUǰ UIFǰ #PBSEǰ PGǰ %JSFDUPSTǰ and being responsible for explaining and answering any ǰ RVFTUJPOTǰSFHBSEJOHǰUIFǰ#PBSEǰPGǰ%JSFDUPSTĴǰSFNVOFSBUJPOǰ in the Shareholders Meeting. ǰ 3FQPSUJOHǰQPMJDJFTǰBOEǰQSJODJQMFTSFBTPOTǰJOǰEFUFSNJOJOHǰ the remuneration of directors and management according ǰ UPǰUIFǰ4&5ǰHVJEFMJOFTǰCZǰEJTDMPTJOHǰUIFNǰJOǰUIFǰ$PNQBOZĴTǰ ǰ BOOVBMǰJOGPSNBUJPOǰEJTDMPTVSFǰ  ǰBOEǰBOOVBMǰSFQPSU ǰ #FJOHǰ SFTQPOTJCMFǰ GPSǰ BOZǰ PUIFSǰ UBTLTǰ SFMBUFEǰ UPǰ UIFǰ ǰ SFNVOFSBUJPOǰBTǰBTTJHOFEǰCZǰUIFǰ#PBSEǰPGǰ%JSFDUPST 3JTLǰ.BOBHFNFOUǰ$PNNJUUFF 5IFǰ3JTLǰ.BOBHFNFOUǰ$PNNJUUFFǰJTǰDPNQPTFEǰPGǰBUǰMFBTUǰUISFFǰ NFNCFSTǰ BQQPJOUFEǰ GSPNǰ UIFǰ $PNQBOZĴTǰ EJSFDUPSTǰ BOEǰ UPQǰ executives with relevant knowledge, competence and experience UIBUǰ FOBCMFǰ BDIJFWFNFOUǰ PGǰ PCKFDUJWFTǰ 5IFǰ DPNNJUUFFǰ DPNQPTJUJPOǰJTǰSFHVMBSMZǰSFWJFXFEǰUPǰųUǰXJUIǰUIFǰ$PNQBOZĴTǰ organization structure and nature of business. 5IFǰ3JTLǰ.BOBHFNFOUǰ$PNNJUUFFǰIPMETǰPSǰDBMMTǰBǰNFFUJOHǰBTǰ deemed appropriate at least twice a year and has the power UPǰBEEJUJPOBMMZǰDBMMǰBǰNFFUJOHǰBTǰEFFNFEǰųU 5IFǰ3JTLǰ.BOBHFNFOUǰ$PNNJUUFFǰQFSGPSNTǰEVUJFTǰBTǰEFTJHOBUFEǰ CZǰUIFǰ#PBSEǰPGǰ%JSFDUPSTǰBOEǰXJUIJOǰUIFǰQVSWJFXǰPGǰQPXFS ǰ EVUJFTǰ BOEǰ SFTQPOTJCJMJUJFTǰ EFųOFEǰ JOǰ UIFǰ 3JTLǰ .BOBHFNFOUǰ $PNNJUUFFǰ$IBSUFSǰǰ .PSFPWFS ǰUIFǰ#PBSEǰPGǰ%JSFDUPSTǰPOǰ'FCSVBSZǰ ǰǰBQQSPWFEǰ (3"..:ǰ(SPVQĴTǰ3JTLǰ.BOBHFNFOUǰ1PMJDZǰBOEǰ'SBNFXPSLǰUPǰ TFSWFǰBTǰBǰHVJEFMJOFǰPOǰHSPVQXJEFǰSJTLǰNBOBHFNFOUǰTZTUFNǰ EFWFMPQNFOUǰ5IFǰTBJEǰQPMJDZǰBOEǰGSBNFXPSLǰXJMMǰCFǰSFHVMBSMZǰ SFWJFXFEǰUPǰųUǰXJUIǰUIFǰ$PNQBOZĴTǰPSHBOJ[BUJPOǰTUSVDUVSFǰBOEǰ OBUVSFǰPGǰCVTJOFTTǰ5IFǰEFUBJMTǰBSFǰQSFTFOUFEǰJOǰUIFǰUJUMFǰĶ3JTLǰ .BOBHFNFOUǰ1PMJDZǰBOEǰ'SBNFXPSLķ


183

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Meeting Attendance (Times)

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Ç° Ç° Ç°

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is appropriate to the exposure, adapted as needed and adopted throughout the organization. ǰ $POUJOVBMMZǰSFQPSUJOHǰUPǰUIFǰ#PBSEǰPGǰ%JSFDUPSTǰPOǰTJHOJųDBOUǰ risks and risk management solutions. 7. Recommending and advising the Risk Management ǰ $PNNJUUFFǰBOEPSǰEFQBSUNFOUTǰBOEPSǰUIFǰSFMFWBOUǰXPSLJOHǰ ǰ DPNNJUUFFTǰBCPVUǰTJHOJųDBOUǰSJTLTǰBCPVUǰSJTLǰNBOBHFNFOU ǰ as well as evaluate the appropriate means to improve various databases that are related to the development of risk management solutions. ǰ "QQPJOUJOHǰ 4VC$PNNJUUFFTǰ BOEPSǰ BEEJUJPOBMǰ SFMBUFEǰ personnel, or replacements in the Risk Management ǰ $PNNJUUFFǰBOEPSǰUIFǰ%FQBSUNFOUǰBOEPSǰUIFǰXPSLJOHǰUFBNǰ that is related to managing risks as necessary, as well as determine their roles and responsibilities in order to achieve the objectives. ǰ &YFDVUJOHǰPUIFSǰBDUJWJUJFTǰUIBUǰQFSUBJOǰUPǰNBOBHJOHǰSJTLTǰBTǰ ǰ BTTJHOFEǰCZǰUIFǰ#PBSEǰPGǰ%JSFDUPST


184

4. Ç° Ç° Ç° Ç° Ç° Ç° Ç°

ANNUAL REPORT 2013

GMM GRAMMY

Corporate Governance and Ethics Committee 5IFǰ$PSQPSBUFǰ(PWFSOBODFǰBOEǰ&UIJDTǰ$PNNJUUFFǰDPNQPTFTǰ ǰ$PNQBOZĴTǰEJSFDUPSTǰXJUIǰSFMFWBOUǰLOPXMFEHF ǰDPNQFUFODFǰ BOEǰFYQFSJFODFǰJOǰWBSJPVTǰCVTJOFTTǰMJOFTǰXIJDIǰJTǰSFWJFXFEǰUPǰųUǰXJUIǰ UIFǰ$PNQBOZĴTǰPSHBOJ[BUJPOǰTUSVDUVSFǰBOEǰOBUVSFǰPGǰCVTJOFTT 5IFǰ$PSQPSBUFǰ(PWFSOBODFǰBOEǰ&UIJDTǰ$PNNJUUFFǰIPMETǰPSǰDBMMTǰ a meeting as deemed appropriate at least two times a year and IBTǰUIFǰQPXFSǰUPǰBEEJUJPOBMMZǰDBMMǰBǰNFFUJOHǰBTǰEFFNFEǰųUǰBOEǰ QFSGPSNTǰEVUJFTǰBTǰEFTJHOBUFEǰCZǰUIFǰ#PBSEǰPGǰ%JSFDUPSTǰBOEǰ Name

Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç°

Term

Meeting Attendance (Times)

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Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç°

Title

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4FDSFUBSZÇ°

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Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç° Ç°

Ç° Ç°

Selection and Appointment of Directors and Management (1) Independent Director %FųOJUJPOǰPGǰ*OEFQFOEFOUǰ%JSFDUPS ǰ "Uǰ UIFǰ #PBSEǰ PGǰ %JSFDUPSTǰ .FFUJOHǰ /P ǰ UIFǰ #PBSEǰ acknowledged and gave consent for the disclosure of revised ǰ RVBMJųDBUJPOTǰ PGǰ *OEFQFOEFOUǰ %JSFDUPSTǰ UPǰ NBUDIǰ UIFǰ ǰ SFRVJSFNFOUTǰ TUJQVMBUFEǰ CZǰ 4&$ǰ BOEǰ 4&5ǰ 5IFǰ $PNQBOZĴTǰ

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*OEFQFOEFOUǰ%JSFDUPSTǰBSFǰRVBMJųFEǰBOEǰJOEFQFOEFOUǰBTǰSFRVJSFE ǰ JOǰUIFǰGPMMPXJOHǰXBZT ǰ )PMEJOHǰTIBSFTǰPGǰOPUǰFYDFFEJOHǰǰPGǰUPUBMǰWPUJOHǰTIBSFTǰ ǰ PGǰUIFǰ$PNQBOZ ǰJUTǰQBSFOUǰDPNQBOZ ǰJUTǰTVCTJEJBSJFT ǰJUTǰ associated companies, its major shareholders, or its controlling persons, including shares held by related parties. ǰ /PUǰCFJOHǰPSǰIBWFǰOPUǰFWFSǰCFFOǰBOǰFYFDVUJWFǰEJSFDUPS ǰ employee, staff, corporate advisor receiving a regular ǰ TBMBSZ ǰPSǰBǰDPOUSPMMJOHǰQFSTPOǰPGǰUIFǰ$PNQBOZ ǰJUTǰQBSFOUǰ company, its subsidiaries, its associated companies, its ǰ TBNFMFWFMǰ TVCTJEJBSJFT ǰ JUTǰ NBKPSǰ TIBSFIPMEFST ǰ PSǰ JUTǰ controlling persons unless the foregoing status has ended ǰ GPSǰ NPSFǰ UIBOǰ ǰ ZFBSTǰ QSJPSǰ UPǰ CFJOHǰ BQQPJOUFEǰ BTǰ ǰ *OEFQFOEFOUǰ %JSFDUPSǰ 4VDIǰ QSPIJCJUJPOTǰ FYDMVEFǰ ǰ HPWFSONFOUǰPGųDFSǰPSǰBEWJTPSǰUPǰBOZǰHPWFSONFOUǰBHFODZǰ ǰ XIPǰJTǰNBKPSǰTIBSFIPMEFSǰPSǰDPOUSPMMJOHǰQFSTPOǰPGǰUIFǰ$PNQBOZǰ ǰ /PUǰCFJOHǰBǰQFSTPOǰSFMBUFEǰCZǰCMPPEǰPSǰCZǰMBXǰJOǰUFSNTǰPGǰ father, mother, spouse, sibling and child, including spouse of the children, of other directors, management, major shareholders, controlling persons, or persons to be nominated as directors, management or controlling persons ǰ PGǰUIFǰ$PNQBOZǰPSǰJUTǰTVCTJEJBSJFTǰ ǰ /PUǰCFJOHǰPSǰIBWFǰOPUǰFWFSǰCFFOǰBOǰBVEJUPSǰPGǰUIFǰ$PNQBOZ ǰ its parent company, its subsidiaries, its associated companies, its major shareholders, or its controlling ǰ QFSTPOT ǰBOEǰJTǰOPUǰBǰTJHOJųDBOUǰTIBSFIPMEFS ǰBǰDPOUSPMMJOHǰ ǰ QFSTPO ǰPSǰBǰQBSUOFSǰPGǰBOǰBVEJUǰųSNǰXIJDIǰFNQMPZTǰBVEJUPSTǰ ǰ PGǰUIFǰ$PNQBOZ ǰJUTǰQBSFOUǰDPNQBOZ ǰJUTǰTVCTJEJBSJFT ǰJUTǰ associated companies, its major shareholders, or its controlling persons unless the foregoing relationship has ǰ FOEFEǰGPSǰNPSFǰUIBOǰǰZFBSTǰQSJPSǰUPǰCFJOHǰBQQPJOUFEǰBTǰ ǰ *OEFQFOEFOUǰ%JSFDUPS


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ǰ /PUǰCFJOHǰPSǰIBWFǰOPUǰIBEǰBǰCVTJOFTTǰSFMBUJPOTIJQǰXJUIǰUIFǰ ǰ $PNQBOZ ǰ JUTǰ QBSFOUǰ DPNQBOZ ǰ JUTǰ TVCTJEJBSJFT ǰ JUTǰ associated companies, its major shareholders, or its controlling persons, in the manner that may interfere with ǰ IJTIFSǰJOEFQFOEFOUǰKVEHFNFOU ǰPSǰJTǰOPUǰPSǰIBTǰOPUǰFWFSǰ ǰ CFFOǰBǰTJHOJųDBOUǰTIBSFIPMEFSǰPSǰBǰDPOUSPMMJOHǰQFSTPOǰPGǰ ǰ BOZǰQFSTPOǰIBWJOHǰCVTJOFTTǰSFMBUJPOTIJQǰXJUIǰUIFǰ$PNQBOZ ǰ its parent company, its subsidiaries, its associated companies, its major shareholders, or its controlling persons unless the foregoing relationship has ended for ǰ NPSFǰUIBOǰǰZFBSTǰQSJPSǰUPǰCFJOHǰBQQPJOUFEǰBTǰ*OEFQFOEFOUǰ ǰ %JSFDUPSǰ5IFǰUFSNǰĶCVTJOFTTǰSFMBUJPOTIJQķǰBGPSFNFOUJPOFEǰ includes any normal business transaction, rental or lease of immovable property, transaction relating to assets or ǰ TFSWJDFT ǰHSBOUǰPSǰSFDFJQUǰPGǰųOBODJBMǰBTTJTUBODFǰUISPVHIǰ receiving or extending loans, guarantee, providing assets as collateral, including any other similar actions which result ǰ JOǰ UIFǰ $PNQBOZǰ PSǰ IJTǰ DPVOUFSQBSUZǰ CFJOHǰ TVCKFDUǰ UPǰ indebtedness payable to the other party in the amount of ǰ ǰPSǰNPSFǰPGǰUIFǰOFUǰUBOHJCMFǰBTTFUTǰPGǰUIFǰ$PNQBOZǰPSǰ ǰ ǰNJMMJPOǰCBIUǰPSǰNPSF ǰXIJDIFWFSǰJTǰMPXFS ǰ /PUǰCFJOHǰPSǰIBWFǰOPUǰFWFSǰCFFOǰBOZǰQSPGFTTJPOBMǰBEWJTPSǰ ǰ JODMVEJOHǰMFHBMǰPSǰųOBODJBMǰBEWJTPSǰXIPǰSFDFJWFTǰBOǰBOOVBMǰ ǰ TFSWJDFǰGFFǰFYDFFEJOHǰǰNJMMJPOǰCBIUǰGSPNǰUIFǰ$PNQBOZ ǰ its parent company, its subsidiaries, its associated companies, its major shareholders, or its controlling persons, ǰ BOEǰJTǰOPUǰBǰTJHOJųDBOUǰTIBSFIPMEFS ǰBǰDPOUSPMMJOHǰQFSTPO ǰ or a partner of the professional advisor unless the foregoing ǰ SFMBUJPOTIJQǰIBTǰFOEFEǰGPSǰNPSFǰUIBOǰǰZFBSTǰQSJPSǰUPǰCFJOHǰ ǰ BQQPJOUFEǰBTǰ*OEFQFOEFOUǰ%JSFDUPS ǰ "OZǰ QFSTPOǰ CFJOHǰ BQQPJOUFEǰ BTǰ *OEFQFOEFOUǰ %JSFDUPSǰ ǰ PGǰUIFǰ$PNQBOZǰNBZǰCFǰBǰQFSTPOǰXIPǰIBTǰPSǰIBTǰIBEǰ a business relationship, or may be a professional advisor ǰ SFDFJWJOHǰBNPVOUǰFYDFFEJOHǰUIPTFǰTQFDJųFEǰJOǰJUFNǰǰPSǰǰ ǰ JOǰDBTFǰUIFǰ#PBSEǰPGǰ%JSFDUPSTǰIBTǰEVMZǰDPOTJEFSFEǰUIBUǰ relationship will not affect the ability to perform duties and express independent opinions. ǰ /PUǰCFJOHǰBǰEJSFDUPSǰSFQSFTFOUJOHǰ#PBSEǰNFNCFSǰPGǰUIFǰ ǰ $PNQBOZĴT ǰJUTǰNBKPSǰTIBSFIPMEFST ǰPSǰBǰTIBSFIPMEFSǰXIPǰ ǰ JTǰSFMBUFEǰUPǰUIFǰ$PNQBOZĴTǰNBKPSǰTIBSFIPMEFSTǰ ǰ %PFTǰ OPUǰ PXOSVOǰ BOZǰ CVTJOFTTǰ TJNJMBSǰ UPǰ PSǰ NBUFSJBMǰ ǰ DPNQFUJOHǰXJUIǰUIFǰ$PNQBOZǰPSǰJUTǰTVCTJEJBSJFT ǰPSǰOPUǰCFJOHǰ ǰ BǰTJHOJųDBOUǰQBSUOFSǰJOǰBOZǰQBSUOFSTIJQ ǰFYFDVUJWFǰEJSFDUPS ǰ employee, staff, advisor receiving regular salary, or holds ǰ NPSFǰUIBOǰǰPGǰUPUBMǰWPUJOHǰTIBSFTǰPGǰUIFǰDPNQBOZǰTJNJMBSǰ ǰ UPǰPSǰNBUFSJBMǰDPNQFUJOHǰXJUIǰUIFǰ$PNQBOZǰPSǰJUTǰTVCTJEJBSJFT ǰ )BWFǰOPǰBOZǰPUIFSǰDIBSBDUFSJTUJDTǰXIJDIǰNBLFǰIJNIFSǰ incapable of expressing independent opinions with regard ǰ UPǰUIFǰ$PNQBOZĴTǰCVTJOFTT ǰ "GUFSǰ CFJOHǰ BQQPJOUFE ǰ *OEFQFOEFOUǰ %JSFDUPSǰ NBZǰ CFǰ ǰ BVUIPSJ[FEǰCZǰUIFǰ#PBSEǰPGǰ%JSFDUPSTǰUPǰNBLFǰBǰDPMMFDUJWFǰ ǰ EFDJTJPOǰUPǰFYFDVUFǰCVTJOFTTǰPGǰUIFǰ$PNQBOZ ǰJUTǰQBSFOUǰ company, its subsidiaries, its associated companies, its

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TBNFMFWFMǰ TVCTJEJBSJFT ǰ JUTǰ NBKPSǰ TIBSFIPMEFST ǰ PSǰ JUTǰ controlling persons. Recruiting independent directors using the same criteria as the criteria and procedure for nomination of directors. (2) Selection and Appointment of Directors and Management (2.1) Selection and Appointment of Directors ǰ ǰ 5IFǰ#PBSEǰPGǰ%JSFDUPSTǰIBTǰBTTJHOFEǰUIFǰ/PNJOBUJPOǰBOEǰ ǰ ǰ 3FNVOFSBUJPOǰ$PNNJUUFFǰUPǰGPSNVMBUFǰSVMFTǰBOEǰQPMJDJFTǰ ǰ ǰ POǰOPNJOBUJPOǰPGǰNFNCFSTǰPGǰUIFǰ#PBSEǰPGǰ%JSFDUPSTǰBOEǰ ǰ ǰ TVCDPNNJUUFFTǰ XJUIǰ SFHBSEǰ UPǰ DPNQPTJUJPO ǰ TUSVDUVSF ǰ ǰ ǰ RVBMJųDBUJPOTǰBOEǰCPBSEǰEJWFSTJUZǰPGǰUIFǰEJSFDUPST ǰBTǰXFMMǰ as to recruit, select and nominate suitable persons to ǰ ǰ TVDDFFEǰUIFǰEJSFDUPSTǰSFUJSFEǰCZǰSPUBUJPOǰBOEPSǰUPǰųMMǰBOZǰ ǰ ǰ WBDBODJFTǰBOEPSǰUPǰųMMǰBEEJUJPOBMǰCPBSEǰTFBUTǰXIJDIǰUBLFTǰ ǰ ǰ JOUPǰ BDDPVOUǰ UIFǰ MBDLǰ PGǰ OFDFTTBSZǰ TLJMMTǰ POǰ UIFǰ #PBSEǰ according to the policy and criteria for the selection of ǰ ǰ EJSFDUPSTǰPGǰUIFǰ$PNQBOZǰGPSǰGVSUIFSǰQSPQPTJOHǰUPǰUIFǰ#PBSEǰ ǰ ǰ PGǰ%JSFDUPSTǰBOEPSǰGPSǰųOBMǰBQQSPWBMǰCZǰUIFǰTIBSFIPMEFSTĴǰ ǰ ǰ NFFUJOH ǰBTǰUIFǰDBTFǰNBZǰCFǰǰ4VGųDJFOUǰJOGPSNBUJPOǰNVTUǰ ǰ ǰ CFǰ QSPWJEFEǰ TPǰ UIBUǰ UIFǰ #PBSEǰ PGǰ %JSFDUPSTǰ BOEǰ UIFǰ shareholders could use as a basis for making the right decision. 1PMJDZǰBOEǰDSJUFSJBǰGPSǰUIFǰ$PNQBOZijTǰOPNJOBUJPOǰPGǰEJSFDUPST ǰ 5IFǰ/PNJOBUJPOǰBOEǰ3FNVOFSBUJPOǰ$PNNJUUFFǰIBTǰBǰEVUZǰUPǰ ǰ OPNJOBUFǰTVJUBCMFǰQFSTPOTǰXJUIǰRVBMJųDBUJPOTǰǰSFRVJSFEǰCZǰUIFǰ ǰ $PNQBOZ ǰ MBXTǰ BOEǰ SFHVMBUJOHǰ BHFODJFTǰ UPǰ CFǰ BQQPJOUFEǰ BTǰ directors replacing directors who retire by rotation or for other reasons, by considering persons with knowledge and experiences ǰ JOǰ WBSJPVTǰ BSFBTǰ TVDIǰ BTǰ BDDPVOUJOH ǰ ųOBODF ǰ NBOBHFNFOU ǰ strategy, law and investment; including those with skills or ǰ FYQFSUJTFǰDPSSFTQPOEJOHǰXJUIǰUIFǰ$PNQBOZĴTǰCVTJOFTTǰOBUVSF ǰ especially leadership, courage to express opinions, decision making with information and reasons, morality and ethics, unblemished ǰ SFDPSETǰGPSǰUIFǰ#PBSEǰPGǰ%JSFDUPSTǰUPǰIBWFǰEJWFSTFǰBOEǰTUSPOHǰ ǰ TUSVDUVSFT ǰCFJOHǰBCMFǰUPǰMFBEǰUIFǰ$PNQBOZǰUPǰBDIJFWFǰCVTJOFTTǰ objectives under management with good corporate governance of international standards. %JSFDUPSǰOPNJOBUJPOǰBOEǰBQQPJOUNFOUǰQSPDFEVSFT ǰ *Oǰ OPNJOBUJOHǰ PSǰ TFMFDUJOHǰ EJSFDUPST ǰ UIFǰ /PNJOBUJPOǰ BOEǰ ǰ 3FNVOFSBUJPOǰ$PNNJUUFFǰGPMMPXTǰUIFǰQSPDFEVSFTǰBTǰGPMMPXT ǰ ǰ $POTJEFSJOHǰUIFǰTVJUBCJMJUZǰPGǰUIFǰOVNCFS ǰDPNQPTJUJPOǰBOEǰ ǰ ǰ TUSVDUVSBMǰEJWFSTJUZǰPGǰUIFǰ#PBSEǰPGǰ%JSFDUPST ǰCBTFEǰPOǰUIFǰ ǰ ǰ $PNQBOZĴTǰOBUVSFǰBOEǰTJ[FǰPGǰCVTJOFTT ǰXJUIǰUIFǰ#PBSEǰ4LJMMǰ ǰ ǰ .BUSJYǰCFJOHǰQSFQBSFEǰGPSǰEFUFSNJOJOHǰUIFǰRVBMJųDBUJPOTǰ ǰ ǰ PGǰBǰEJSFDUPSǰUPǰCFǰOPNJOBUFEǰBOEǰUIFǰRVBMJųDBUJPOǰPSǰTLJMMTǰ ǰ ǰ SFRVJSFEǰCZǰPSǰJOBEFRVBUFǰJOǰUIFǰ#PBSEǰPGǰ%JSFDUPST ǰ ǰ 4FMFDUJOHǰEJSFDUPSTǰGSPNǰJOUFSOBMǰFYFDVUJWFTǰBOEǰPVUTJEFSTǰ ǰ ǰ XIPǰIBWFǰUIFǰSFRVJSFEǰRVBMJųDBUJPOT ǰJODMVEJOHǰQFSTPOTǰPOǰ ǰ ǰ UIFǰMJTUǰJOǰUIFǰ*0%ǰ$IBSUFSFEǰ%JSFDUPSǰEBUBCBTF ǰ ǰ 5IFǰ/PNJOBUJPOǰBOEǰ3FNVOFSBUJPOǰ$PNNJUUFFǰBQQSPBDIFT ǰ interviews and discusses with the persons possessing the


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ANNUAL REPORT 2013

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GMM GRAMMY

SFRVJSFEǰRVBMJųDBUJPOTǰUPǰFOTVSFǰUIBUǰUIFǰQFSTPOTǰXJMMǰCFǰ XJMMJOHǰUPǰUBLFǰEJSFDUPSTIJQǰXJUIǰUIFǰ$PNQBOZǰJGǰBQQPJOUFEǰ CZǰUIFǰ#PBSEǰPGǰ%JSFDUPSTǰPSǰBǰTIBSFIPMEFSTĴǰNFFUJOH ǰBTǰ the case may be. ǰ 5IFǰ/PNJOBUJPOǰBOEǰ3FNVOFSBUJPOǰ$PNNJUUFFǰQSPQPTFTǰ ǰ UIFǰQFSTPOǰXIPǰNFFUTǰUIFǰOPNJOBUJPOǰDSJUFSJBǰUPǰUIFǰ#PBSEǰ ǰ PGǰ %JSFDUPSTǰ GPSǰ BQQPJOUNFOUǰ PSǰ FOEPSTFNFOUǰ CFGPSFǰ ǰ TVCNJTTJPOǰUPǰBǰTIBSFIPMEFSTĴǰNFFUJOHǰGPSǰBQQPJOUNFOUǰ individually, on the basis of ǰ ǰǰTIBSFǰIFMEǰJTǰFRVJWBMFOUǰUPǰǰWPUF ǰ ǰ&BDIǰTIBSFIPMEFSǰNBZǰVTFǰBMMǰWPUFTǰJOǰDMBVTFǰǰUPǰFMFDUǰ ǰ ǰ ǰQFSTPOǰPSǰTFWFSBMǰQFSTPOTǰBTǰEJSFDUPSTǰCVUǰDBOOPUǰ divide the votes for any persons. ǰ ǰ1FSTPOTǰ XIPǰ SFDFJWFǰ UIFǰ IJHIFTUǰ OVNCFSǰ PGǰ WPUFTǰ respectively shall be appointed as directors in the number of directors that have to be elected. ǰ ǰ *OǰDBTFǰQFSTPOTǰXIPǰIBWFǰCFFOǰFMFDUFEǰJOǰUIFǰGPMMPXJOHǰ order have equal votes which will make the number of directors elected exceeds the number required, the ǰ ǰ $IBJSNBOǰPGǰUIFǰNFFUJOHǰTIBMMǰIBWFǰBǰTFDPOEǰWPUF ǰ "QQPJOUJOHǰEJSFDUPSTǰJOǰBDDPSEBODFǰXJUIǰUIFǰ$PNQBOZĴTǰ ǰ "SUJDMFTǰPGǰ"TTPDJBUJPO ǰ "TǰSFHBSEǰUPǰUIFǰJOEFQFOEFOUǰEJSFDUPST ǰUIFǰ/PNJOBUJPOǰ ǰ BOEǰ3FNVOFSBUJPOǰ$PNNJUUFFǰXJMMǰTFMFDUǰBOEǰOPNJOBUFǰ ǰ QFSTPOTǰXIPǰGVMMZǰNFFUǰUIFǰRVBMJųDBUJPOTǰPGǰJOEFQFOEFOUǰ ǰ EJSFDUPSTǰTUJQVMBUFEǰCZǰUIFǰ#PBSEǰPGǰ%JSFDUPSTǰJOǰDPNQMJBODFǰ ǰ XJUIǰHVJEFMJOFTǰPGǰUIFǰ4&5ǰBOEǰ4&$ǰGPSǰGVSUIFSǰQSPQPTJOHǰ ǰ UPǰUIFǰTIBSFIPMEFSTĴǰNFFUJOHǰGPSǰBQQSPWBM (2.2) Selection and appointment of Management ǰ )VNBOǰ 3FTPVSDFǰ 6OJUǰ XJMMǰ SFDSVJUǰ BOEǰ TFMFDUǰ RVBMJųFEǰ individuals with knowledge, experience and understanding of business and propose to authorized persons for consideration. Management shall be nominated and appointed in line ǰ XJUIǰUIFǰ$PSQPSBUFǰ"VUIPSJ[BUJPOǰ*OEFYǰBTǰGPMMPXT ǰ ǰ 5IFǰ BQQPJOUNFOUǰ PGǰ (SPVQǰ $IJFGǰ &YFDVUJWFǰ 0GųDFSǰ ǰ ǰ BOEPSǰ$IJFGǰ&YFDVUJWFǰ0GųDFǰNVTUǰCFǰQSPQPTFEǰUPǰ ǰ ǰ UIFǰ#PBSEǰPGǰ%JSFDUPSTǰGPSǰBQQSPWBM ǰ ǰ 5IFǰ BQQPJOUNFOUǰ PGǰ TFOJPSǰ NBOBHFNFOUǰ $-FWFM ǰ ǰ ǰ $IJFGǰ'JOBODFǰ0GųDFS ǰ$IJFGǰ*OWFTUNFOUǰ0GųDFS ǰ$IJFGǰ ǰ ǰ "ENJOJTUSBUJWFǰ 0GųDFS ǰ TIBMMǰ CFǰ BQQSPWFEǰ CZǰ (SPVQǰǰ ǰ ǰ &YFDVUJWFǰ$PNNJUUFF ǰ ǰ "QQPJOUNFOUǰPGǰNBOBHFNFOUǰCFMPXǰUIFǰMFWFMǰTQFDJųFEǰ ǰ ǰ JOǰ ǰTIBMMǰCFǰBQQSPWFEǰCZǰ(SPVQǰ$IJFGǰ&YFDVUJWFǰ0GųDFSǰ ǰ ǰ BOEǰCFMPXǰMFWFMFYFDVUJWFTǰ EFQFOEJOHǰPOǰUIFǰDBTF 

ǰ 4FOEJOHǰUIFǰ$PNQBOZĴTǰIJHIMFWFMǰFYFDVUJWFTǰXJUIǰLOPXMFEHF ǰ abilities and experiences related to the business and management to be directors or executives of those companies at least in proportion to the number of shares held, with ǰ DPOTFOUǰPGǰUIFǰ#PBSEǰPGǰ%JSFDUPST ǰ(SPVQǰ$IJFGǰ&YFDVUJWFǰ0GųDFSǰ ǰ PSǰ$IJFGǰ&YFDVUJWFǰ0GųDFSǰPGǰFBDIǰCVTJOFTTǰMJOFǰJOǰBDDPSEBODFǰ ǰ XJUIǰUIFǰ$PSQPSBUFǰ"VUIPSJ[BUJPOǰ*OEFYǰBTǰTQFDJųFEǰJOǰUIFǰTDPQFTǰ of duties and responsibilities of directors or executives ǰ SFQSFTFOUJOHǰUIFǰ$PNQBOZ ǰ 3FRVJSJOHǰUIBUǰBǰNFFUJOHǰPGǰIJHIMFWFMǰFYFDVUJWFTǰCFǰIFMEǰPODFǰ a month to jointly determine policies, strategies, operating guidelines, follow up on operations in accordance with the set strategies, and report the operating results, problems and obstacles to the management to participate in determining ǰ QPMJDJFTǰPOǰCVTJOFTTǰPQFSBUJPOTǰ5IFǰNFFUJOHǰJTǰEJWJEFEǰJOUPǰ ǰ HSPVQT ǰTVDIǰBTǰ(SPVQǰ&YFDVUJWFǰ$PNNJUUFFǰ.FFUJOH ǰ$PSQPSBUFǰ ǰ .BOBHFNFOUǰ.FFUJOH ǰ$PSQPSBUFǰ4USBUFHZǰ.FFUJOH ǰ&YFDVUJWFǰ ǰ $PNNJUUFFǰ .FFUJOHǰ PGǰ FBDIǰ CVTJOFTTǰ MJOFǰ BOEǰ &YFDVUJWFǰ ǰ $PNNJUUFFǰ.FFUJOHǰPGǰBTTPDJBUFǰDPNQBOJFT ǰFUD ǰ 5IFǰ#PBSEǰPGǰ%JSFDUPSTǰIBTǰEFUFSNJOFEǰUIFǰ(SPVQĴTǰ"VUIPSJ[BUJPOǰ ǰ *OEFY ǰTQFDJGZJOHǰBQQSPWBMǰQPXFSǰJOǰTVQFSWJTJOHǰTVCTJEJBSJFTǰBOEǰ associated companies, such as management power, investment, ǰ ųOBODJBMǰNBOBHFNFOU ǰBQQSPWBMǰPGǰDPOOFDUFEǰUSBOTBDUJPOT ǰFUD ǰ %FUFSNJOJOHǰSFHVMBUJPOTǰGPSǰJNQPSUBOUǰGVODUJPOTǰTVDIǰBTǰ)VNBOǰ ǰ 3FTPVSDFTǰ .BOBHFNFOUǰ 3FHVMBUJPO ǰ 1VSDIBTJOHǰ 3FHVMBUJPO ǰ ǰ "TTFUǰ.BOBHFNFOUǰ3FHVMBUJPO ǰ"EWBODFǰ1BZNFOUǰ3FHVMBUJPO ǰ ǰ FUD ǰTPǰBTǰUPǰQSPWJEFǰUIFǰ(SPVQǰXJUIǰEFųOJUJWFǰPQFSBUJOHǰHVJEFMJOFTǰ as standards for supervision and control. 5. Sending teams to randomly inspect operations of subsidiaries on a regular basis. ǰ 0QFSBUJPOǰ BOEǰ FYQFOTFǰ DPOUSPMǰ CZǰ DFOUSBMJ[JOH ǰ ųOBODF ǰ accounting and operations departments of subsidiaries, and determining payment ceilings and authorized persons for ǰ QBZNFOUǰ XJUIǰ DPTJHOFSTǰ GPSǰ SFWJFXǰ QVSQPTFǰ BOEǰ TVQQPSUJOHǰ documents in place. 7. Requiring that subsidiaries and associated companies prepare annual budgets, with budget review and adjustment for operating controls on a regular basis. ǰ %JTDMPTVSFǰ PGǰ ųOBODJBMǰ JOGPSNBUJPO ǰ UIFǰ $PNQBOZĴTǰ PWFSBMMǰ ǰ PQFSBUJOHǰSFTVMUT ǰDPOTPMJEBUFEǰųOBODJBMǰTUBUFNFOUǰBOEǰųOBODJBMǰ ǰ JOGPSNBUJPO ǰQSFQBSFEǰJOǰBDDPSEBODFǰXJUIǰHFOFSBMMZBDDFQUFEǰ accounting standards and audited by reliable auditors, and disclosure of other important information, such as investment structures, risk factors and connected transactions.

Confidentiality and Treatment of Insider Information 5IFÇ°#PBSEÇ°PGÇ°%JSFDUPSTÇ°JTÇ°DPNNJUUFEÇ°UPÇ°DPOEVDUJOHÇ°CVTJOFTTÇ°XJUIÇ°

Supervision of subsidiaries and associated companiesâ&#x20AC;&#x2122; integrity, transparency, fairness and equal treatment of all operations TUBLFIPMEFST Ç°BOEÇ°BEPQUTÇ°BÇ°QPMJDZÇ°POÇ°DPOųEFOUJBMJUZÇ°BOEÇ°USFBUNFOUÇ°PGÇ° 5IFÇ° #PBSEÇ° PGÇ° %JSFDUPSTÇ° IBTÇ° NFDIBOJTNTÇ° UPÇ° TVQFSWJTFÇ° BOEÇ° DPOUSPMÇ° JOTJEFSÇ°JOGPSNBUJPOÇ°CZÇ°JOTUJUVUJOHÇ°BÇ°DPEFÇ°PGÇ°FUIJDTÇ°POÇ°DPOųEFOUJBMJUZ Ç° UIFÇ°PQFSBUJPOTÇ°PGÇ°TVCTJEJBSJFTÇ°BOEÇ°BTTPDJBUFEÇ°DPNQBOJFTÇ°BTÇ°GPMMPXTÇ° protection of information and treatment of insider information in the


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$PNQBOZĴTǰ$PSQPSBUFǰ(PWFSOBODFǰBOEǰ#VTJOFTTǰ&UIJDTǰ.BOVBM ǰXIJDIǰ DPVMEǰCFǰTVNNBSJ[FEǰBTǰGPMMPXT ǰ 5IFǰ $PNQBOZǰ TIBMMǰ QSPWJEFǰ UIFǰ EJSFDUPSTǰ BOEǰ NBOBHFNFOUǰ ǰ JODMVEJOHǰUIFJSǰTQPVTFǰBOEǰNJOPSǰDIJMESFO ǰXJUIǰLOPXMFEHFǰBOEǰ understanding about reporting of their securities holding and ǰ DIBOHFTǰ JOǰ TFDVSJUJFTǰ IPMEJOHǰ JOǰ UIFǰ $PNQBOZǰ UPǰ UIFǰ 4&$ǰ ǰ BDDPSEJOHǰUPǰ4FDUJPOǰǰPGǰUIFǰ4FDVSJUJFTǰBOEǰ&YDIBOHFǰ"DUǰ#&ǰ ǰ  ǰ XIFSFCZǰ UIFZǰ NVTUǰ BMTPǰ QSPWJEFǰ TVDIǰ SFQPSUǰ UPǰ UIFǰ ǰ $PNQBOZǰ4FDSFUBSZǰGPSǰGVSUIFSǰOPUJųDBUJPOǰUPǰDPODFSOFEǰQBSUJFTǰǰ ǰ 5IFZǰNVTUǰBMTPǰCFǰJOGPSNFEǰPGǰQVOJTINFOUǰDMBVTFTǰGPSǰBOZǰ ǰ WJPMBUJPOǰPSǰOPODPNQMJBODFǰXJUIǰUIFǰTBJEǰSFHVMBUJPO ǰ 5IFǰ EJSFDUPST ǰ NFNCFSTǰ PGǰ (SPVQǰ &YFDVUJWFǰ $PNNJUUFFǰ BOEǰ ǰ NBOBHFNFOUǰ BTǰ EFųOFEǰ CZǰ 4&$ǰ BOEǰ 4&5 ǰ JODMVEJOHǰ UIFJSǰ respective related persons according to Section 59 of the ǰ 4FDVSJUJFTǰBOEǰ&YDIBOHFǰ"DU ǰIBWFǰUIFǰEVUZǰUPǰSFQPSUǰUIFJSǰIPMEJOHǰ ǰ PGǰUIFǰ$PNQBOZĴTǰTFDVSJUJFTǰBUǰUIFǰųSTUǰDIBODFǰPGǰUIFJSǰCFJOHǰ appointed to assume such position and upon any later change ǰ JOǰUIFJSǰTBJEǰTFDVSJUJFTǰIPMEJOHǰ5IFǰ$PNQBOZǰ4FDSFUBSZǰJTǰUPǰ submit a summary report on the said securities holding and ǰ DIBOHFTǰJOǰTFDVSJUJFTǰIPMEJOHǰJOǰUIFǰ$PNQBOZǰUPǰUIFǰ#PBSEǰPGǰ ǰ %JSFDUPSTĴǰNFFUJOHǰRVBSUFSMZǰGPSǰBDLOPXMFEHFNFOU ǰ 5IFǰ$PNQBOZǰXJMMǰJOGPSN ǰJOǰXSJUJOHǰPSǰFMFDUSPOJDǰNBJMǰ FNBJM ǰ the directors, management and employees who have access to crucial insider information that could affect trading prices of ǰ UIFǰ$PNQBOZĴTǰTFDVSJUJFTǰPGǰUIFJSǰCFJOHǰQSPIJCJUFEǰGSPNǰUSBEJOHǰ ǰ UIFǰ $PNQBOZĴTǰ TFDVSJUJFTǰ EVSJOHǰ Bǰ ǰ NPOUIǰ QFSJPEǰ QSJPSǰ UPǰ ǰ BOOPVODFNFOUǰPGǰUIFǰ$PNQBOZĴTǰXPSLJOHǰSFTVMUTǰ UIFǰQFSJPEǰ ǰ TQFDJųFEǰGPSǰTVDIǰBOOPVODFNFOUǰJTǰǰEBZTǰGSPNǰUIFǰFOEǰPGǰ ǰ RVBSUFSǰ BOEǰ ǰ EBZTǰ GSPNǰ UIFǰ FOEǰ PGǰ BDDPVOUJOHǰ QFSJPE ǰ PSǰ disclosure of such information to the public. ǰ 6OEFSǰUIFǰ$(ǰQPMJDZ ǰUIFǰEJSFDUPSTǰBOEǰFYFDVUJWFTǰ BTǰEFųOFEǰ ǰ CZǰUIFǰ4&$ǰBOEǰUIFǰ4&5 ǰTIBMMǰSFQPSUǰUIFJSǰTUPDLǰUSBEJOHǰUPǰ0GųDFǰ ǰ PGǰ$PSQPSBUFǰ4FDSFUBSZ ǰBUǰMFBTUǰǰEBZǰQSJPSǰUPǰUIFǰUSBOTBDUJPOǰ ǰ EBUF ǰJOǰPSEFSǰUPǰHBUIFSǰBMMǰJOGPSNBUJPOǰBOEǰJOGPSNǰUIFǰ#PBSEǰPGǰ ǰ %JSFDUPST ǰ *UǰJTǰTUBUFEǰJOǰUIFǰFNQMPZNFOUǰDPOUSBDU ǰXPSLJOHǰQSJODJQMFT ǰBOEǰ ǰ FNQMPZFFǰ CFTUǰ QSBDUJDFTǰ UPXBSETǰ UIFǰ $PNQBOZ ǰ BOEǰ BMTPǰ JTǰ ǰ EFFNFEǰUPǰCFǰFNQMPZFFTĴǰCVTJOFTTǰFUIJDT ǰUIBUǰFNQMPZFFTǰTIBMMǰ ǰ TUSJDUMZǰQSPUFDUǰDPOųEFOUJBMǰJOGPSNBUJPOǰBOEǰTIBMMǰOPU ǰEVFǰUPǰ ǰ UIFJSǰQPTJUJPOǰJOǰUIFǰ$PNQBOZ ǰTFFLǰUPǰCFOFųUǰUIFNTFMWFTǰPSǰ their related parties by unethically using or publicly disclosing ǰ UIFǰ$PNQBOZĴTǰJOGPSNBUJPOǰPSǰOFXTǰXIJDIǰJTǰDPOųEFOUJBMǰBOEǰ has not yet been released to the public, or to cause a decrease ǰ JOǰ UIFǰ $PNQBOZĴTǰ CFOFųUT ǰ PSǰ UBLFǰ BOZǰ BDUJPOTǰ UIBUǰ DSFBUFǰ ǰ DPOŴJDUTǰPGǰJOUFSFTU ǰ *NQPSUBODFǰJTǰBUUBDIFEǰUPǰUIFǰTUSJDUǰBOEǰDPOTJTUFOUǰQSPUFDUJPOǰ ǰ PGǰDVTUPNFSTĴǰDPOųEFOUJBMǰJOGPSNBUJPOǰBOEǰQSFWFOUJPOǰPGǰUIFǰVTFǰ ǰ PGǰTVDIǰJOGPSNBUJPOǰGPSǰQFSTPOBMǰCFOFųUTǰPSǰSFMBUFEǰQBSUJFTĴǰ ǰ CFOFųUT ǰ FYDFQUǰ GPSǰ UIFǰ JOGPSNBUJPOǰ UIBUǰ NVTUǰ CFǰ EJTDMPTFEǰ publicly according to relevant laws.

ǰ *OǰDBTFTǰXIFSFǰFYUFSOBMǰQBSUJFTǰBSFǰJOWPMWFEǰJOǰTQFDJBMǰQSPKFDUTǰ dealing with information undisclosed to the public and is in the negotiation stage, such projects fall into the scope of insider ǰ JOGPSNBUJPOǰBTǰJUǰNBZǰBGGFDUǰUIFǰQSJDFǰPGǰUIFǰ$PNQBOZĴTǰTFDVSJUJFTǰǰ ǰ 5IFTFǰFYUFSOBMǰQBSUJFTǰNVTUǰTJHOǰBǰDPOųEFOUJBMJUZǰBHSFFNFOUǰXJUIǰ ǰ UIFǰ$PNQBOZǰVOUJMǰUIFǰJOGPSNBUJPOǰJTǰEJTDMPTFEǰUPǰ4&5ǰBOEǰǰ4&$ ǰ 5IFǰ$PNQBOZǰIBTǰFTUBCMJTIFEǰBǰDPEFǰPGǰFUIJDTǰPOǰUIFǰVTFǰPGǰ computers, information and communication technology so as ǰ UPǰDPOUSPMǰBOEǰQSPUFDUǰEBUBǰTFDVSJUZǰJOǰJOGPSNBUJPOǰTZTUFNTǰBOEPSǰ prevent outsiders from gaining access to such information. ǰ 5IFǰ $PNQBOZǰ BMTPǰ TFUTǰ UIFǰ MFWFMTǰ PGǰ FNQMPZFFTĴǰ EBUBǰ accessibility according to their authority and responsibility. ǰ 5IFǰ $PNQBOZǰ XJMMǰ MFWZ ǰ BDDPSEJOHǰ UPǰ JUTǰ SFHVMBUJPOT ǰ UIFǰ maximum penalty on any member of the Management, employees or related parties found to have unethically used insider information or behaved in such a way that could cause ǰ EBNBHFǰUPǰUIFǰ$PNQBOZ ǰ 5IFǰ .BOBHFNFOUǰ XJMMǰ SFQPSUǰ BOZǰ VOFUIJDBMǰ VTFǰ PGǰ JOTJEFSǰ information or behavior that could cause damage to the ǰ $PNQBOZǰUPǰUIFǰ#PBSEǰPGǰ%JSFDUPSTǰGPSǰJOGPSNBUJPOǰPOǰBǰZFBSMZǰCBTJT ǰ *Oǰ ǰUIFǰ$PNQBOZĴTǰBQQSPBDIǰUPǰQSFWFOUJPOǰPGǰVOFUIJDBMǰ use of insider information was still effective.

Compensation of external auditor $PNQFOTBUJPOǰQBJEǰCZǰUIFǰ$PNQBOZǰBOEǰJUTǰTVCTJEJBSJFTǰUPǰFYUFSOBMǰ auditors 1. Auditing fees ǰǰ *Oǰ ǰUIFǰ(SPVQǰBQQPJOUFEǰ&:ǰ0GųDFǰ-JNJUFEǰ 'PSNFSMZǰLOPXOǰ ǰ BTǰĶ&SOTUǰǰ:PVOHǰ0GųDFǰ-JNJUFEķ ǰBOEǰ1SPǰ5SJOJUZǰ-UEǰBTǰUIFǰ(SPVQĴTǰ ǰ FYUFSOBMǰBVEJUPSTǰXJUIǰBVEJUJOHǰGFFT ǰBNPVOUJOHǰUPǰ  ǰbaht XJUIǰBǰCSFBLEPXOǰBTǰGPMMPXT  2ǰ "VEJUJOHǰGFFTǰGPSǰ&:ǰ0GųDFǰ-JNJUFEǰ 'PSNFSMZǰLOPXOǰBTǰ ǰ ǰ Ķ&SOTUǰǰ:PVOHǰ0GųDFǰ-JNJUFEķ ǰBNPVOUJOHǰUPǰ  ǰbaht 2ǰ "VEJUJOHǰGFFTǰGPSǰ1SPǰ5SJOJUZǰ-UE ǰBNPVOUJOHǰUPǰ ǰǰbaht 2. Compensation for other services ǰ 5IFSFǰXBTǰOPǰDPNQFOTBUJPOǰGPSǰPUIFSǰTFSWJDFT ǰXIFUIFSǰJOǰUIFǰ ǰ QBTUǰBDDPVOUJOHǰQFSJPEǰPSǰJOǰUIFǰGVUVSFǰGPSǰVOųOJTIFEǰTFSWJDFTǰ agreed in the past year accounting period.

Other operations under the principles of good corporate governance "TǰUIFǰ#PBSEǰPGǰ%JSFDUPSTǰIBTǰJOUFOUJPOTǰUPǰPQFSBUFǰCVTJOFTTǰVOEFSǰUIFǰ QSJODJQMFTǰPGǰHPPEǰDPSQPSBUFǰHPWFSOBODF ǰUIFǰ$PSQPSBUFǰ(PWFSOBODFǰ BOEǰ #VTJOFTTǰ &UIJDTǰ .VOVBMǰ XBTǰ SFWJTFEǰ BOEǰ JNQSPWFEǰ GPSǰ UIFǰ 5thǰ UJNFǰ JOǰ ǰ BOEǰ QVCMJTIFEǰ JOǰ UIFǰ (SPVQĴTǰ XFCTJUFTǰ BOEǰ UIFǰ $PNQBOZĴTǰXFCTJUFǰBOEǰJOǰUIFǰ$PSQPSBUFǰ(PWFSOBODFǰ3FQPSUǰPGǰ5IBJǰ -JTUFEǰ$PNQBOJFTǰCZǰUIFǰ5IBJǰ*OTUJUVUFǰPGǰ%JSFDUPSTǰ *0% ǰXIFSFǰUIFǰ $PNQBOZǰXBTǰSBUFEǰĶ&YDFMMFOUǰ ǰTUBST ķǰGPSǰǰDPOTFDVUJWFǰZFBSTǰ5IFǰ #PBSEǰPGǰ%JSFDUPSTǰJTǰDPNNJUUFEǰUPǰJNQSPWJOHǰUIFǰ(SPVQĴTǰDPSQPSBUFǰ HPWFSOBODFǰXJUIǰBǰCFMJFGǰUIBUǰUIFǰ(SPVQĴTǰBEIFSFODFǰUPǰUIFǰTZTUFNǰ and process of good corporate governance will contribute to the (SPVQĴTǰTVTUBJOBCMFǰHSPXUIǰBOEǰQSPTQFSJUZ


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ANNUAL REPORT 2013

GMM GRAMMY

Internal Control and Risk Management 3FDPHOJ[JOHǰUIFǰJNQPSUBODFǰPGǰBOǰJOUFSOBMǰDPOUSPMǰTZTUFN ǰUIFǰ#PBSEǰPGǰ%JSFDUPSTǰIBTǰQVUǰJOǰQMBDFǰBOǰJOUFSOBMǰDPOUSPMǰTZTUFNǰUIBUǰHPWFSOTǰ UIFǰųOBODJBM ǰNBOBHFNFOUǰBOEǰPQFSBUJPOBMǰBTQFDUTǰGPSǰHSFBUFSǰFGGFDUJWFOFTTǰBOEǰFGųDJFODZǰJOǰBDDPSEBODFǰXJUIǰSFMBUFEǰMBXTǰBOEǰSFHVMBUJPOTǰǰ .FBOXIJMF ǰBOǰFNQIBTJTǰJTǰQMBDFEǰPOǰDPOUJOVPVTǰJNQSPWFNFOUǰBDDPSEJOHǰUPǰ$040ǰ 5IFǰ$PNNJUUFFǰPGǰ4QPOTPSJOHǰ0SHBOJ[BUJPOTǰPGǰ5SFBEXBZǰ $PNNJTTJPO ǰXJUIǰSFTQFDUǰUPǰPSHBOJ[BUJPOBMǰBOEǰDPOUSPMǰFOWJSPONFOU ǰSJTLǰBTTFTTNFOU ǰDPOUSPMǰ"DUJWJUJFT ǰJOGPSNBUJPOǰBOEǰDPNNVOJDBUJPOǰ and monitoring activities. 5IFǰ#PBSEǰPGǰ%JSFDUPSTǰIBTǰDMFBSMZǰEFųOFEǰJOǰXSJUJOHǰUIFǰEVUJFTǰBOEǰBQQSPWBMǰBVUIPSJUZǰGPSǰUIFǰ.BOBHFNFOU ǰBOEǰIBTǰDPOUSPMMFEǰBOEǰFOTVSFEǰ BOǰFGųDJFOUǰVUJMJ[BUJPOǰPGǰUIFǰ$PNQBOZĴTǰBTTFUTǰ5PǰNBJOUBJOǰQSPQFSǰDIFDLTǰBOEǰCBMBODFT ǰUIFǰSPMFTǰBOEǰEVUJFTǰPGǰGSPOUMJOFǰPQFSBUPST ǰ TVQFSWJTPSTǰBOEǰFWBMVBUPSTǰBSFǰDMFBSMZǰEFMJOFBUFEǰ*OǰBEEJUJPO ǰUIFǰ$PNQBOZǰFOTVSFTǰUIBUǰUIFSFǰJTǰBǰųOBODJBMǰSFQPSUJOHǰUPǰUIPTFǰJOǰUIFǰEJSFDUǰ line of responsibility. 5IFSFǰJTǰBMTPǰUIFǰ"VEJUǰ$PNNJUUFF ǰXIJDIǰXBTǰBQQPJOUFEǰCZǰUIFǰ#PBSEǰPGǰ%JSFDUPST ǰCZǰUIFǰ4UPDLǰ&YDIBOHFǰPGǰ5IBJMBOEĴTǰHVJEFMJOFTǰXIJDIǰ DVSSFOUMZǰDPOTJTUTǰPGǰǰJOEFQFOEFOUǰEJSFDUPSTǰBOEǰUIFǰ%JSFDUPSǰPGǰ*OUFSOBMǰ"VEJUǰ%FQBSUNFOUǰBDUTǰBTǰ4FDSFUBSZǰPGǰUIFǰ"VEJUǰ$PNNJUUFFǰ5IFǰ "VEJUǰ$PNNJUUFFǰIBTǰUIFǰEVUJFTǰBOEǰSFTQPOTJCJMJUJFTǰPGǰBVEJUJOHǰųOBODJBMǰTUBUFNFOUT ǰEJTDMPTVSFǰPGǰUIFǰųOBODJBMǰSFQPSUTǰBOEǰSFMBUFEǰUSBOTBDUJPOTǰ PSǰBOZǰNBUUFSTǰXJUIǰDPOŴJDUTǰPGǰJOUFSFTUǰUPǰCFǰBDDVSBUFǰ ǰDPNQMFUF ǰSFMJBCMF ǰBOEǰDPPSEJOBUFǰXJUIǰUIFǰ*OUFSOBMǰ"VEJUǰ%FQBSUNFOU ǰBVEJUPSTǰ BOEǰNBOBHFNFOUǰPGǰUIFǰ$PNQBOZǰUPǰSFWJFXǰUIFǰJOUFSOBMǰDPOUSPMǰTZTUFNǰBOEǰFOTVSJOHǰDPNQMJBODFǰXJUIǰUIFǰSFMFWBOUǰMBXTǰBOEǰSFHVMBUJPOT ǰ BTǰXFMMǰBT ǰǰUPǰDPOTJEFSǰBOEǰBQQSPWFǰBOǰBVEJUǰQMBO ǰQFSGPSNBODFǰFWBMVBUJPOǰBOEǰDPNQFOTBUJPOǰPGǰUIFǰ*OUFSOBMǰ"VEJUǰ%FQBSUNFOU ǰJODMVEJOHǰ TFMFDUJPOǰBOEǰBQQPJOUNFOUǰPGǰUIFǰBVEJUPSǰBOEǰBVEJUǰGFFǰ5IFǰ"VEJUǰ$PNNJUUFFǰTIBMMǰBMTPǰQFSGPSNǰPUIFSǰEVUJFTǰBTǰBTTJHOFEǰCZǰUIFǰ#PBSEǰ PGǰ%JSFDUPST ǰBOEǰDPOEVDUǰTFMGBTTFTTNFOUǰUPǰFWBMVBUFǰUIFJSǰQFSGPSNBODFǰUPǰFOTVSFǰUIBUǰUIFǰ"VEJUǰ$PNNJUUFFǰIBTǰQFSGPSNFEǰUIFJSǰEVUJFTǰ effectively and completely. 5IFǰ#PBSEǰPGǰ%JSFDUPSTǰIBTǰTUJQVMBUFEǰUIBUǰUIFSFǰCFǰBOǰBTTFTTNFOUǰPGǰUIFǰBEFRVBDZǰPGǰUIFǰ$PNQBOZĴTǰBOEǰJUTǰTVCTJEJBSJFTĴǰJOUFSOBMǰDPOUSPMǰ TZTUFNǰBOEǰBǰSFQPSUJOHǰPGǰUIFǰBTTFTTNFOUǰSFTVMUTǰUPǰUIFǰ#PBSEǰPGǰ%JSFDUPSTĴǰNFFUJOHǰPOǰBǰZFBSMZǰCBTJTǰ5IFǰBTTFTTNFOUǰSFTVMUTǰBSFǰBMTPǰUPǰ CFǰEJTDMPTFEǰJOǰUIFǰ$PNQBOZĴTǰBOOVBMǰSFHJTUSBUJPOǰTUBUFNFOUǰ 'PSNǰ ǰBOEǰBOOVBMǰSFQPSUǰ "MMǰ#PBSEǰPGǰ%JSFDUPSTǰNFNCFSTǰBOEǰUIFǰ.BOBHFNFOU ǰIBEǰDPMMBCPSBUJWFMZǰFWBMVBUFEǰUIFǰTVGųDJFODZǰPGǰJOUFSOBMǰDPOUSPMǰEVSJOHǰǰ5IFǰ #PBSEǰPGǰ%JSFDUPSTǰ.FFUJOHǰPOǰ'FCSVBSZǰ ǰǰDPNQSJTJOHǰPGǰUIFǰ#PBSEǰPGǰ%JSFDUPST ǰUIFǰ"VEJUǰ$PNNJUUFF ǰBOEǰUIFǰ.BOBHFNFOUǰDPOWFOFEǰ BǰNFFUJOHǰGPSǰUIFǰBEFRVBDZǰPGǰUIFǰJOUFSOBMǰDPOUSPMǰTZTUFNTǰPGǰUIFǰ$PNQBOZǰBOEǰJUTǰTVCTJEJBSJFTǰBTǰTFUǰVQǰCZǰUIFǰ.BOBHFNFOUǰJOǰųWFǰBSFBT ǰ OBNFMZ ǰJOUFSOBMǰDPOUSPM ǰSJTLǰBTTFTTNFOU ǰPQFSBUJPOǰDPOUSPM ǰJOGPSNBUJPOǰBOEǰDPNNVOJDBUJPOǰTZTUFNǰBOEǰNPOJUPSJOHǰTZTUFNǰ5IFǰ#PBSEǰPGǰ %JSFDUPSTǰBOEǰUIFǰ"VEJUǰ$PNNJUUFFǰTIBSFEǰUIFǰTBNFǰPQJOJPOǰUIBUǰǰ Ķ5IFǰPWFSBMMǰJOUFSOBMǰDPOUSPMǰTZTUFNǰPGǰUIFǰ$PNQBOZĴTǰBOEǰJUTǰTVCTJEJBSJFT ǰJTǰBEFRVBUFǰBOEǰBQQSPQSJBUFǰJOUFSOBMǰDPOUSPMǰTZTUFNǰSFHBSEJOHǰ USBOTBDUJPOTǰXJUIǰNBKPSǰTIBSFIPMEFST ǰEJSFDUPST ǰNBOBHFNFOUǰPSǰUIPTFǰJOWPMWFEǰXJUIǰTVDIǰQFSTPOTǰ'PSǰJOUFSOBMǰDPOUSPMǰJOǰPUIFSǰJUFNT ǰUIFǰ#PBSEǰ PGǰ%JSFDUPSTǰBOEǰUIFǰ"VEJUǰ$PNNJUUFFǰPQJOFEǰUIBUǰUIFǰ$PNQBOZĴTǰJOUFSOBMǰDPOUSPMǰJTǰBEFRVBUFǰBOEǰBQQSPQSJBUFǰUPǰUIFǰCVTJOFTTǰPQFSBUJPOTǰPGǰ UIFǰ$PNQBOZǰBTǰXFMMǰ5IFǰ"VEJUǰ$PNNJUUFFǰBOEǰUIFǰ.BOBHFNFOUǰTIBSFǰUIFǰTBNFǰBTQFDUǰGPSǰUIFǰJNQPSUBODFǰPGǰHPPEǰDPSQPSBUFǰHPWFSOBODF ǰ JOUFSOBMǰDPOUSPMǰBOEǰDPOUJOVJOHǰSJTLǰNBOBHFNFOUǰJOǰPSEFSǰUPǰFODPVSBHFǰUIFǰ$PNQBOZǰUPǰIBWFǰHPPEǰDPSQPSBUFǰHPWFSOBODF ǰTVGųDJFOUǰBOEǰ appropriate internal control in accordance with business operations, acceptable risk management, correct and reliable accounting system BOEǰųOBODJBMǰSFQPSUT ǰBOEǰDPNQMJBODFǰXJUIǰMBXTǰBTǰXFMMǰBTǰSFHVMBUJPOTǰSFMBUFEǰUPǰCVTJOFTTǰPQFSBUJPOTǰPGǰUIFǰ$PNQBOZķ

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189

Connected Transactions 1. Parties which may have conflicts of interest that have entered into connected transactions with the Company and its subsidiaries Ç° Ç° Ç° Ç° Ç°

*Oǰ ǰ(..ǰ(SBNNZǰ1VCMJDǰ$PNQBOZǰ-JNJUFEǰ ĶUIFǰ$PNQBOZķ ǰBOEǰJUTǰTVCTJEJBSJFTǰFOUFSFEǰJOUPǰDPOOFDUFEǰUSBOTBDUJPOTǰXJUIǰUIFǰ $PNQBOZǰBOEǰDPOOFDUFEǰQFSTPOTǰXIFSFǰDPOŴJDUTǰPGǰJOUFSFTUǰNBZǰIBWFǰPDDVSSFEǰ5IFTFǰJODMVEFEǰCPUIǰUSBOTBDUJPOTǰXIJDIǰXFSFǰUIFǰ OPSNBMǰDPVSTFǰPGǰCVTJOFTTǰCZǰUIFǰ$PNQBOZǰBOEǰTVCTJEJBSJFT ǰBOEǰUSBOTBDUJPOTǰXIJDIǰXFSFǰOPUǰ#VTJOFTTǰHSPVQTǰUIBUǰDPOEVDUFEǰDPOOFDUFEǰ USBOTBDUJPOTǰBSFǰEJWJEFEǰJOUPǰǰDBUFHPSJFTǰBTǰGPMMPXT A) The Group ǰ 5IFǰ(SPVQǰDPNQPTFTǰPGǰUIFǰ$PNQBOZǰBOEǰTVCTJEJBSJFTǰPGǰUIFǰ$PNQBOZ

Details of the Group are as follows: Company (..Ç°(SBNNZÇ°1VCMJDÇ°$PNQBOZÇ°-JNJUFEÇ° 4VCTJEJBSJFTÇ°%JSFDUMZÇ°IFMEÇ°CZÇ°UIFÇ°$PNQBOZ (..Ç°.FEJBÇ°1VCMJDÇ°$PNQBOZÇ°-JNJUFEÇ°Ç° (..Ç°)PMEJOHTÇ°$PNQBOZÇ°-JNJUFEÇ° (..Ç°.VTJDÇ°1VCMJTIJOHÇ°*OUFSOBUJPOBMÇ°$PNQBOZÇ°-JNJUFEÇ° (..Ç°5IBJÇ°)VCÇ°$PNQBOZÇ°-JNJUFEÇ°Ç° 'BOÇ°57Ç°$PNQBOZÇ°-JNJUFEÇ° "OPUIFSÇ°Ç°JTÇ°IFMEÇ°CZÇ° Ç° (..Ç°)PMEJOHT Ç°BÇ°TVCTJEJBSZ Ç° 3%Ç°$PNQBOZÇ°-JNJUFEÇ° (3Ç°7PDBMÇ°4UVEJPÇ°$PNQBOZÇ°-JNJUFEÇ°Ç° (..Ç°$+Ç°0Ç°4IPQQJOHÇ°$PNQBOZÇ°-JNJUFEÇ° (%$Ç°$PNQBOZÇ°-JNJUFEÇ°Ç° (..Ç°;Ç°5SBEJOHÇ°$PNQBOZÇ°-JNJUFEÇ°Ç° Ç° Ç°Ç°JTÇ°IFMEÇ°CZÇ°Ç°(..Ç°;Ç°$PNQBOZÇ°-JNJUFE

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%JHJTUSFBNǰ$PNQBOZǰ-JNJUFEǰ 'PSNFSMZǰLOPXOǰBTǰ ǰ Ķ#BOHǰ$IBOOFMǰ$PNQBOZǰ-JNJUFEķǰǰǰǰ ǰ JTǰIFMEǰCZǰ(..ǰ;ǰ$PNQBOZǰ-JNJUFE ǰ .("ǰ$PNQBOZǰ-JNJUFEǰ %JHJUBMǰ(FOǰ$PNQBOZǰ-JNJUFEǰǰ

Business Type 'VMMZJOUFHSBUFÇ°FOUFSUBJONFOUÇ°CVTJOFTTFT Ç°JODMVEJOHÇ° music business, digital business, media business, movie business, event management business, etc.

% Holding by the Company (As at 31 December 2013) Ç° Ç°

1SPEVDFTÇ°SBEJPÇ°QSPHSBNNFTÇ° *OWFTUTÇ°JOÇ°PUIFSÇ°DPNQBOJFTÇ° .BOBHFTÇ°NVTJDÇ°DPQZSJHIUTÇ° 1SPEVDFTÇ°BOEÇ°EJTUSJCVUFTÇ°NPWJFTÇ°BOEÇ°UFMFWJTJPOÇ°QSPHSBNNFTÇ° ,BSBPLFÇ°TFSWJDFÇ°QSPWJEFSÇ°BOEÇ°QSPEVDUJPOÇ°PGÇ° Ç° TBUFMMJUFÇ°UFMFWJTJPOÇ°QSPHSBNNFTÇ° 1SPWJEFTÇ°DVTUPNFSÇ°TFSWJDFÇ°WJBÇ°UFMFQIPOFÇ° .VTJDÇ°"DBEFNZÇ° 8IPMFTBMFÇ°BOEÇ°SFUBJMÇ°PGÇ°HPPET Ç°CZÇ°UBLJOHÇ°PSEFSTÇ°CZÇ°QIPOFTÇ° 1SPWJEFTÇ°TFSWJDFÇ°UPÇ°HBNFTÇ°NFNCFST Ç°EJTUSJCVUFTÇ° games playing cards 1SPWJEFTÇ°BOEÇ°EJTUSJCVUFTÇ°PGÇ°TBUFMMJUFÇ°UFMFWJTJPOÇ°SFDFJWFSTÇ°

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Ç°Ç°Ç°


190

ANNUAL REPORT 2013

GMM GRAMMY

Details of the Group are as follows: (continued) Company

Business Type

&YUSBPSHBOJ[FSÇ°$PNQBOZÇ°-JNJUFEÇ° $VSSFOUMZÇ°JOBDUJWFÇ° .PSFÇ°.VTJDÇ°$PNQBOZÇ°-JNJUFEÇ° $VSSFOUMZÇ°JOBDUJWFÇ° 5IFÇ°/FXTÇ°57Ç°Ç°$PNQBOZÇ°-JNJUFEÇ° $VSSFOUMZÇ°JOBDUJWFÇ° Ç° Ç°Ç°JTÇ°IFMEÇ°CZÇ°(..Ç°;Ç°DPNQBOZÇ°-JNJUFE

% Holding by the Company (As at 31 December 2013) Ç° Ç° Ç°Ç°Ç°

+PJOUMZÇ°DPOUSPMMFEÇ°FOUJUJFTÇ°BOEÇ°IFMEÇ°CZÇ°UIF Company ,Ç°"SFOBÇ°$PNQBOZÇ°-JNJUFEÇ°Ç°

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Ç° Ç° Ç° Ç° Ç° Ç° Ç°

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191

Details of the Group are as follows: (continued) Company (5)Ç°0OÇ°"JSÇ°$PNQBOZÇ°-JNJUFEÇ° Ç° "OPUIFSÇ°Ç°JTÇ°IFMEÇ°CZÇ°UIFÇ°$PNQBOZÇ°BOEÇ°Ç° Ç° BOPUIFSÇ°Ç°JTÇ°IFMEÇ°CZÇ°*NBHFÇ°1VCMJTIJOH Ç°Ç° Ç° BÇ°TVCTJEJBSZ

(PPEÇ°5IJOHÇ°)BQQFOÇ°$PNQBOZÇ°-JNJUFEÇ°

Business Type

% Holding by the Company (As at 31 December 2013)

1SPEVDFTÇ°TBUFMMJUFÇ°UFMFWJTJPOÇ°QSPHSBNNFTÇ° Ç° Ç° Ç° Ç°

Ç°Ç°Ç° Ç° Ç° Ç° Ç°

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192

ANNUAL REPORT 2013

GMM GRAMMY

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194

ANNUAL REPORT 2013

GMM GRAMMY

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195

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Ç° Ç° Ç° Ç°


196

ANNUAL REPORT 2013

GMM GRAMMY

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197

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Corporate Social Responsibilities (CSR)


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Corporate Social Responsibilities (CSR) Policy

Vision To be a leader in creating and producing of all forms of entertainment, in tandem with all types of media and technological developments, to provide a great quality of life and unlimited happiness. Mission Engage in the continuous creation of excellent and innovative work Encourage a learning organization Enrich people so they are passionate and skillful in their work and enjoy a better quality of life Endorse social responsibilities and activities Long Term Goal To sustainably be the number one entertainment company in Thailand. Ethics on Roles and Responsibilities towards Community, the Environment, and the Society The Board of Directors strongly believes in conducting business according to business ethics and good corporate governance principles and alongside corporate social responsibility (CSR) to be embedded as part of the organization culture. This is carried by integrating with the Company’s vision, mission, strategy, and long term goal to create sustainable business growth. details of the policies and regulations are as follows : 1. Supporting CSR development through co-creation with all stakeholders by participating, inspiring, and giving opportunities to other organizations to work together 2. Supporting provision of knowledge and training for staff to instill conscience of responsibility toward the community, the environment, and the society in employees at all levels and encourage employees to participate in activities arranged by the Company 3. Having social participation by supporting and promoting activities which maintain good tradition and culture, and behaving as a good religion follower by supporting religious activities consistently 4. Participating in supporting activities relating to education, sporting capabilities, development of professional knowledge, for sustainable self-dependence 5. Having social responsibility relating to public beneųts, maintenance of the environment, and development of the community as well as creative projects to promote and support better living of underprivileged, the elderly, children, and youths 6. Having social responsibility in different forms such as organizing campaigns against narcotics continuously, hence promotion and support of children and youths to stay away from narcotics, leading to a strong community and narcotic-free society 7. Holding various projects to assist and relieve misery of people who are in trouble in many ways 8. Supporting the community surrounding the Company and other communities to be strong and self-dependent in a sustainable manner, give mutual help, have a good quality of life, be happy and live happily in harmony 9. Campaigning and instilling in employees conscience of preservation and smart and efųcient use of resources and energy 10. Creating and supporting activities which are beneųcial to maintenance, preservation, and use of natural resources and energy on a consistent basis 11. Not performing any acts which will impair the reputation of the country, natural resources, and the environment 12. Not cooperating with or support any persons or organizations conducting illegal business or being a threat to the society and national security 13. Complying or monitoring to ensure strict compliance with relevant regulations and laws

Operations and Report Preparation

The Group operates business with responsibility to community, society and environment for sustainability of the Group and social as a part of in-process operation by taking into account all stakeholder groups under the selection of CSR activities which are in line with the business, in other word, the Group is doing business for proųt together with social responsibility to create sustainable business growth as the long term goal of the Company.


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The Group discloses information on corporate social responsibility in accordance with the Integrated CSR Reporting Framework, Version 2, set by Thaipat Institute and the Corporate Social Responsibility Guidelines prepared by the Working Group for the Promotion of Corporate Social Responsibility and Environment in Listed Companies, as follows : 1. Fair Business Operation The Board of Directors has been adhering to the business operation under business ethics, related laws, standards and code of best practices as deųned in the Corporate Governance and Business Ethics Manual and there are other actions as follows : 1.1 The Company has deųnite policies and practices on the treatments of all stakeholders as speciųed in the ethics of treatment of shareholders, ethics of treatment of customers and consumers, ethics of treatment of competitors, ethics of treatment of trading partners, ethics of treatment of creditors and ethics of treatment of employees, without a preference for any particular groups or persons. 1.2 The Company has deųnite operating procedures and practices for various matters such as purchasing, employment, with approval authorization powers clearly deųned for respective matters so that operations can be carried out with transparency, justice, and accountability. 1.3 Opening opportunity for all groups of stakeholders to express their opinions for improvement of the Company’s business operations at various occasions, such as annual general meetings of shareholders, business visit, press conferences, analysts’ meetings, etc. 1.4 The Board of Directors is committed to conducting business with integrity, transparency, fairness and equal treatment of all stakeholders, and adopts a policy on conųdentiality and treatment of insider information by instituting a code of ethics on conųdentiality, protection of information and treatment of insider information. 1.5 The Board of Directors has a policy to respect intellectual property rights of other persons by not violating or supporting any acts which can be regarded as violation of intellectual property rights and copyrights of other persons, thus reŴecting the Company’s strong intention to conduct business with fairness, and respect for and compliance with the laws relating to intellectual property rights, by instituting a code of Ethics on Intellectual Property and Copyright and the company has a policy to promote the use of legal products by cooperating with state agencies and related private sector parties in a campaign against piracy titled ‘Took, Took Jai, Took Gohd Mai” (‘Cheap, Pleasing, Legal) to raise awareness of copyright protection among the public through various activities. The ‘Not Buy, Not Sell, Not Use Pirate Goods” slogan aims to encourage the public to be more aware of the intellectual property to help reduce the piracy problem in the long run.

1.6 The Group promotes free trade competition under fair play rules, not seeking conųdential information of business competitors in a dishonest manner. 1.7 Treating trading partners equitably and fairly, not demanding or receiving any dishonest assets or beneųts from trading partners, having deųnite operating procedures and purchasing committees responsible for the selection of trading partners, and not cooperating with or supporting any persons or organizations engaged in illegal businesses or posing threats to society and national security. 1.8 Maintaining agreements and foster sustainable relationships with trading partners and contracting parties, adhering to trading conditions or agreements made with each other in a strict manner. 2. Anticorruption The Company’s Board of Directors adheres to transparent business operations under legal frameworks, principle of ethics, and good corporate governance guidelines, supporting anticorruption campaigns, with full awareness that corruption is detrimental to the development of the country’s economic, social and national security systems as deųned in the Corporate Governance and Business Ethics Manual.


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The Company has supervisory measures in place to ensure that employees comply with anticorruption policies and practices and provides channels where complaints and information on dishonest practices can be sent to the Audit Committee, which comprises independent directors, by posting and e-mail at auditcommittee@gmmgrammy.com, as given in the Company’s website, Annual Information Report Form (Form 56-1), the Company’s Annual Report and Good Corporate Governance and Business Ethics Manual for processing and submission to the Board of Directors. The Company also has a policy to protect the provider of information or clues and treat the information with strict conųdentiality, with measures on investigation and punishment under relevant regulations. In 2013, there were no reports or cases of fraudulent activities involving the Company and/or afųliated companies. Besides, the Company promoted the provision of knowledge on this matter among employees by organizing a seminar on “Prevention and Guidelines on Resolving Fraudulent Action in the Organization.” and sent employees to attend anticorruption training courses organized by various institutions in order to study, review, and develop the Company’s disclosure of anticorruption information, as follows : • “Communications and procedures in formulating anticorruption policies by listed companies,” organized by Thai Listed Companies Association in cooperation with the SEC. • Thailand's 4th National Conference on Collective Action Against Corruption under the course “Working Models for Governance in Corporate Operations and Infrastructure Projects,” organized by Thailand's Private Sector Collective Action Coalition Against Corruption (CAC) in cooperation with Thailand Development Research Institute (TDRI), Thai Institute of Directors Association (Thai IOD), Center for International Private Enterprise (CIPE), and the SET. 3. Respecting Human Right The Board of Directors gives importance to respecting human right law and practice, as indicated in the Corporate Governance and Business Ethics Manual Ref: Respect of Human Right Law and Practice. This could well signify the Board’s commitment to conducting business in compliance with laws, while embracing human rights which are the basic rights ensuring that all human beings are born free and equal in dignity and rights without discrimination against berth, race, nationality, color, gender, religion, age, language, physical and health condition, personal status, economic and social status, social value, education or political opinion. The Board also promotes employees’ awareness of their rights, duties and responsibilities to society and other fellows. In the past year, the Company treated all stakeholders equitably without discrimination, such as • Among the Company’s executives and employees are males and females, Buddhists, Christians and Muslims, who work together in a reconciliatory manner. Without discrimination, everyone has opportunity for promotion, based primarily on performance. • At receptions organized for employees and shareholders on various occasions, the Company places importance on the selection of foods for guests of all religions or vegetarians, at all times. • The Company is not opposed to political expressions and exercises of rights under provisions of laws by employees at all levels. 4. Fair treatment of labor The Board of Directors is conscious of the value of every employee as given in the policies and practices in the ethics on treatment of employees and in 2013 the Group organized welfare-related activities on personnel promotion and development in various areas, as follows : 4.1 Annual health check-up was arranged for employees with health examination choices suitable to the age of each employee and special health examination at discount prices at the Company’s premises and provisions of special health examinations with discount prices for members of the employees’ families. 4.2 Employee welfare in various forms, such as medical expenses (inpatient, outpatients, dental care, optical care), treatment room service, life insurance and group accident insurance, ųnancial assistance and other welfare (ųnancial assistance in case of the death of employees and the death of their parents, children or spouses under law; ųnancial assistance in case of employee’s marriage, employee’s ordination, etc.) 4.3 Providing housing loan sources with special interest rates and beneųts in other transactions with banks for employees. 4.4 Supporting and providing knowledge to employees on ųnancial investment, tax management and savings for future, by inviting experts from ųnancial institutions to lecture on investment in interesting funds especially investment with tax beneųts such as long-term equity funds (LTF), retirement mutual funds (RMF). 4.5 Arrangement of 30 in-house training courses (219 hours) and dispatched its employees to attend 55 external courses (768 hours) conducted by various institutions, focusing on managerial, professional and team-working skill development. 4.6 Encouraging employees to participate in an array of activities regularly arranged by the Group such as social, environmental and energy conservation activities, blood donation and always playing games to win free tickets for concerts, movies and theatrical performances.


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4.7 Employees may lodge complaints or provide clues on suspicious cases of right infringement, fraudulent action breaches of laws and policies on good governance and business ethics, to the Audit Committee by e-mail at auditcommittee@gmmgrammy. com for investigation and submission to the Company’s Board of Directors. Besides, the Company has provided other assistance to the employees for special cases, for instance, the Company decided to grant subsidy, and accommodation at work during the previous heavy Ŵood. The Board of Directors has realized about safety at workplace as Ethics on Workplace Safety and Sanitation to provide a safe and hygienic working atmosphere for management and employees. Employee well-being is a part of the Company’s mission which is to “promote employees’ job satisfaction and skill and better quality of life.” In 2013, the Company took measures to ensure safety as follows: 1) Appointment of a Workplace Welfare Committee with duties to give advices, consultations and recommendations to the employer on welfare useful for employees and to inspect, control, and supervise the welfare provided by the employer to the employees, with the ofųce term of two years. 2) Appointment of a Safety, Occupational Health and Environment Committee to ensure that the Company’s safety operations are correct, up to standards and comply with laws related, with operations and improvement continuously and systematically for the safety of employees, contractors, and outsiders in the Company, with the ofųce term of two years. 3) The Company hired SGS (Thailand) Co., Ltd., expert on system inspection, testing and certiųcation to test dust in the ofųce; six samples of air examination on the 5th Ŵoor were randomly taken and the result of the dust test was found “not dangerous” as follows : - Particulate matter with the size smaller than 10 microns (10,000 microns = 1 cm) can pass to deep parts of the human’s respiratory system such as air vesicles, where the standard value must be less than150 wg/m3, but the average measured value was 22.67 wg/m3. - The amount of total dust of all sizes, including the one mentioned above and dust of larger sizes, can make the Ŵoor unclean. The standard amount of dust must be lower than 15 mg/m3, while the average amount of the tested dust was 0.626 mg/m3. 4) Improvement of air ventilation systems in ųre aisles to release polluted air by: 4.1 Installation of roof fans at the deck Ŵoor over the ųre aisle, with an interlock system in case of emergency when the system must stop for air to be sucked into the ųre aisle. 4.2 Installation of gravity damper at the ųre exit door of the 10th Ŵoor for fresh air from outside and air leak protection system at the ųre exit door of every Ŵoor. 5) The Company has organized training courses on ųre drill and ųrst aid for staff who trapped in the building on a yearly basis both at GMM Grammy Place Building and Distribution Center.


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6) Organized training on occupational health in the workplace at Distribution Center, such as 킬rst aid by invited speakers from Kluaynamthai Hospital on Febuary 28, 2013.

With commitment to the safety and health of employees, the Company in 2013 did not have any injury or illness as a result of work. 5. Responsibility to customers and consumers

The Board of Directors is committed to the creation and production of media and entertainment of all forms to bring about satisfaction for customers continuously, with channels of distribution provided for all groups of customers to access goods and services at suf킬cient quantities and fair prices, as given in the policies and practices on customers and consumers in the ethics on treatment of customers and consumers.


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The Company is committed to the distribution of quality goods and services to customers by : 5.1 Disclosing detailed information of goods and services. The goods are not hazardous to consumers and can be returned in case of defects or shortfalls, not meeting the information on the label and advertisement, or they can be returned under normal commercial conditions of certain types of business. There are multiple channels for change or return of goods, depending on the characteristics of goods distribution. Following are examples of the changes or returns of goods in the past by the Company. • Returns of concert tickets, for example, the tickets for “Nantida The Show Must Go On” concert and “Sarm Yake Pak Wan Episode 3” concert by A Time Media Co., Ltd. were returned for postponing the shows due to political unrests; the audiences were informed in advance through various channels that they were allowed to follow the shows according to new schedules with the original tickets and at original seats. For those who were not convenient to follow on the shows under new schedules, they were allowed to return the tickets at the main counter of Thaiticketmajor, at any of its 13 branches or Call Center (662) 262 3456. • Set-top boxes of GMM Z Trading Co., Ltd. can be changed within warranty conditions (one year), new set-top box would be delivered to the customers free of charge within 15 days of the date of change agreement. Customers may contact sales agent shops for change or directly return the boxes to GMM Z Trading Co., Ltd. via Post Box 88, Phra Khanong, Bangkok, while wholesale customers have to contact sales representatives. • Change or return of defective or obsolete magazines of GMM Inter Publishing company limited, the stores can be made through the Distribution Agent within three months after the date of delivery. • Change of damaged CDs, VCDs or DVDs of Imagine shops, the Company’s retail shops, can be made in seven days, with the shop’s receipt being presented. • Return of damaged or outdated CDs, VCDs, or DVDs, in case of wholesale, can be made through the Company’s sales representatives under the agreement made between the customers and the Company. • Change or return of goods of GMM CJ O Shopping Co., Ltd. can be made under the condition and time period for each product on a case by case basis. such as errors in delivery, losses during delivery, change of color or size (for fashion goods). The Company is responsible for the delivery cost in case of change if the error is made by the Company. In case the change of color or size is made at the request of the customer, the delivery cost shall be borne by the customer. The customer may return goods by arranging for a pickup at the customer’s residence, return by parcel post, or return to the Company’s warehouse. Call (662) 817 9988 or e-mail care@gcj.co.th for more details, please 5.2 Considering the importance of the safety of employees, the Company takes measures to deal with risk from activities. For example, for concert shows, the Company has plans in place and rehearses them to brace for violence that may occur, such as deployment of staff to take care of the audience and escort them to safe places in case of a violent incident. Insurance is also bought to cover such activities. 5.3 The Group has a data base of customers by group in giving discounts, privileges or organizing sales promotion activities. The Company has a security system to protect the database; no information can be shared with others without consent of the customer. 5.4 With diverse businesses and customer databases, the Group has set up a call center to provide services in giving advices and information, answers, receiving complaints and solving problems for customers and interest parties. Customers can call the Group’s call center at (662) 669 9000 and directly call each business’s call center such as the call center for set-top boxes of GMM Z at 1629 and the call center of A-Time Media Co., Ltd. at (662) 669 9500. Besides, the Group has other channels of communications such as e-mail and post, as may be deemed convenient to the customer. 5.5 With commitment to the development of goods and services, taking into consideration not only proųts but also responsibility to society and environment, the Group has therefore created work or activities for society. i.e., operate business for the Company’s proųt and generate beneųts for society (CSR in process), such as • Songs in honor of His Majesty the King such as “Ton Mai Khong Phor” (Tree of the Father), “Khong Khwan Jak Kon Din” (Gift from the Soil), “Roop Thi Mee Yoo Thuk Baan” (The Photo Belonging to Every House) and “Phra Racha Phu Songtham” (The Virtuous King). • Songs to create willpower in leading life from the past until the present time, such as “Tham Dee Dai Dee” (Do Good, Receive Good), “Phalang Namjai Thai” (Power of Thai Spirit), “Cheewit Pen Khong Rao” (Life is Ours), “Saeng Sud Thai” (The Last Light) and “Rua Lek Khwan Ok Jak Fang” (Small Boats Should Leave the Shore) • Animated cartoon Byrdland…Land of Miracles, Episode “Following the King’s Footsteps,” encouraging children and viewers to learn and appreciate His Majesty the King’s efforts and intelligence in solving problems for Thai people, in 26 chapters, such as, Royal Rain, Chaipattana Aerator, Monkey’s Cheek, Soil Aggravation, Self-sufųciency Paths, etc.


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Animated cartoon Byrdland…Land of Miracles: Season 3, Special episode “Promoting the Value of Thai Culture,” that promotes awareness of being Thai by inserting Thai values, cultures and arts, as well as the traditions of each region of Thailand. • To Be Number One Project, the project encouraging Thai youth to spend their free time usefully, keeping themselves away from drugs. 5.6 The Group is committed to developing goods and services of all categories, aiming to access every customer and bring about customer satisfaction by offering quality goods and services, on a continued basis, while instilling awareness of responsibility to society and environment under various projects, such as, Green Fan Club’s Activity “Free Crabs …Plant Trees” for the environment, and projects promoting good quality of life, where the Group cooperates with the public and private sectors, foundations, etc., to support activities useful to society, such as World Aids Campaign, blood donations, artists’ beloved items auction for World Red Cross, eye donation campaign, ųnancial assistance to needy patients, project for the development of buildings and provision of medical equipment for needy patients of Ramathibodi Hospital etc.

6. Environment Conservation Considering the importance of environment protection, especially energy conservation, the Board of Directors promotes the project for building personnel on energy conservation for the improvement of the energy use efųciency in the future or BEAT 2010 (Building Energy Awards of Thailand 2010), which will be discussed under Innovations and the Dissemination of Innovations in Corporate Social Responsibility Operations, the campaign and creation of awareness among employees in energy conservation and the wise and efųcient use of resources and energy. The Board also creates activities useful to environment protection and supports the use of resources, environment and energy on a continued basis, where all employees are duty-bound to prevent the property under their care from degradation, loss or damage, as well as efųcient use of other resources of the Company and the country. The Company has prepared guidelines for management and campaigns in various forms, with emphasis on the use of energy as necessary to reduce the waste of resources. Training was organized to provide knowledge and instill awareness on employees under topic “New GMM Attends to Energy” on September 23, 2013. Besides, the Company organized activities to instill environment awareness among customers, such as Green Fan Club’s activity “Free Crabs…Plant Trees” for environment, in a BangkokHua Hin rally to free crabs and plant trees for the environment, led by DJ Oy, DJ An, DJ Fiat, DJ Ket, DJ Baem, with artist Phichika Watcharawali joining in planting trees and releasing young crabs to the nature.

7. Community and social development In the past, GMM Grammy Group had important roles on social responsibility and environment, with key persons in various areas taking part in activities as operators, organizers or supporters, aiming to enable communities to be self dependent, help each other, have good quality of life, and live together with happiness continuously. In 2013, the Group’s major projects on community and social responsibility were as follows :


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Project in honor of His Majesty the King The Company in cooperation with the Ministry of Culture by the Ofųce of Contemporary Arts and Culture and Silpakorn University’s Faculty of Music organized a project to create a contemporary moral song, named “Phra Racha Phu Song Tham (The Virtuous King), in honor of His Majesty the King on the occasion of His Majesty the King’s Birth Anniversary on December 5, 2013, with BirdThongchai Mcintyre being the vocalist. The project aimed to encourage people to do good, think good, including youth, to be exposed to Buddhist teachings by using this song as the media.

Project promoting Thai culture values on children and youth The Company is committed to the creation of work for the happiness of youth along with the promotion of knowledge and morality through 3D cartoon animation TV series on a continued basis. In 2013, the presentation was Byrdland…Land of Miracles: Season 3, special episode “Promoting the Value of Thai Culture,” that promotes the awareness of being Thai by inserting Thai values, cultures and arts, as well as the traditions of each region of Thailand. it was presented in the form of an adventure with Byrdland cartoons, where the audience can acquire knowledge, amusement and good impressions, such as Thai houses of the 4 regions, Thai puppet shows, silk fabric, basketry, etc


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Blood Donation Project The Company has regularly held a ‘blood donation’ activity to offer a chance to the Company’s employees, organizations and communities nearby, and interested persons, to join this great giving activity four times a year since 2005. In 2013, the Company organized the ‘blood donation’ activity on February, May, August, and November. Total number of blood donors was 608. In addition, Green Wave 106.5 FM has publicized for the public and private sectors regularly to invite listeners to donate blood when a great amount of blood is required, such as an unrest situation, accident or disaster, natural disaster, etc.

Just Say No” Project “Just Say No” is a project to campaign against drugs that the Company has played a leading role continuously. With awareness of drug problems that can pose serious threats to society and national security, the Company has implemented various campaign projects such as “Just Say No”, “World No Smoking Day”, “World Anti-Drug”, “No Alcohol Day,” etc.

To Be Number One Project The Company participated in “To Be Number One” Project in the anti-drug campaign project initiated by Mental Health Department, Ministry of Public Health, by sending artists to join in concert shows with students, members of To Be Number One club to display anti-drug power in 2012, marking the 11st anniversary of To Be Number One Project.


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Besides, the Group’s artists serve as role models of good people in society and are engaged in charitable activities for society in various areas, winning honor awards or being recognized as campaign leaders and role models in society. In 2013, a large number of the Company’s artists won honor awards, such as • Bird-Thongchai Mcintyre, the Company’s artist and Ter-Chantawit Thanasewee, artist of GTH Co., Ltd. (an afųliated company), winning honor award “Phra Kinnari” Somdej Phra Yan Sangvorn, Supreme Patriarch, Good People, Good Society, Following His Majesty the King’s Footsteps, organized by Broadcaster and Journalist’s Assembly of Thailand. The assembly selected people with achievements in career and family life and contributions to society and the country in various forms, deserving to be role models of good people, good thinking and good society, following His Majesty the King’s footsteps. • Gan-Naphat Injaiau, winning national outstanding youth award on media for children and youth in social problems protection. The Ofųce of Promotion and Protection of Children, Youth, the Elderly and Vulnerable Groups, the Ministry of Social Development and Human Security selected people with good behavior, abilities, contributions, performance relating to the transfer of information, entertainment and values, resulting in knowledge, understanding and right attitudes about children, youth and families. • Toomtam-Yuttana Puangklang and Dome Jaruwat Cheawaram, winning award “Child with High Gratitude to Mother” on the occasion of National Mother Day 2013, organized by National Council on Social Welfare of Thailand under Royal Patronage. 8. Innovation and the dissemination of innovation through corporate social responsibility The Company cooperated with Geurt Fah Company Limited, the owner of GMM Grammy Place building, has joined a campaign on producing personnel on building energy conservation or Building Energy Awards of Thailand 2010 Project (BEAT 2010), aiming to instill awareness on energy conservation among the public, produce personnel on energy conservation as an important force for the country in the long run, and encourage the general public to become aware of energy conservation from real examples of known buildings. As the detail of measures in the Company’s annual registration statement (Form 56-1) Company has received awards from the project as follows : 1. The Ministry of Energy’s BEAT Awards 2010 on innovation and creation of mass awareness on energy conservation on March 8, 2012. 2. ESCO Project Award 2012, No. 1, under the energy service company promotion project for the success in energy conservation through the use of ESCO system of the Institute of Industrial Energy, the Federation of Thai Industries, and the Department of Alternative Energy Development and Efųciency (DEDE), Ministry of Energy on January 17, 2012. Dissemination of innovation The Company has disseminated innovation on energy conservation to the mass of people by 1. Publication of works in the book, “Join Forces to Conserve Building Energy,” published by Energy Policy and Planning Ofųce, Ministry of Energy. 2. Publication of works in Eworld Magazine, Issue 2013-02 of February 2013, under the topic, “GMM Grammy uniting all green building sciences for sustainable energy saving” 3. Sending representatives to join hands with the Federation of Thai Industries in giving lectures on the topic, “Break Energy Crisis by ESCO Service,” in various regions such as Bangkok, Pattaya, Nakhon Ratchasima, Rayong, Phetchaburi, etc. 4. Sending representatives to give lectures on energy conservation technology transfer to graduate students on energy conservation at Thammasat University. 5. Welcoming interested parties from various sectors, including universities and business, to visit the Company’s Energy Conservation Project in GMM Grammy Place Building, such as Airports of Thailand Public Company Limited, CP All Public Company Limited, PTT Public Company Limited, Energy Policy and Planning Ofųce, Ministry of Energy, King Mongkut’s University of Technology Thonburi, Thammasat University, Tesco Lotus Company Limited, Siam Paragon Department Stores, Bangkok Metro Public Company Limited, etc. The Group is committed to the implementation of various activities on a continue basis for sustainable development of Thai society throughout the time.

Business operations with impacts on social responsibility

The Board of Directors adheres to business operations in accordance with the principle of ethics and guidelines on good corporate governance, with responsibility to community, society and environment, and therefore has never breached laws related to social responsibility operations.


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Activities beneficial to society and environment

The Group and its artists have carried out activities for society and environment; these include donations, charitable activities for society, anti-drug campaigns, support to the Thai Red Cross Society’s activities, party organizing for children at welfare centers and support to brave soldiers, as given in the Company’s website under “Corporate Social Responsibility.”

Additional guidelines on the prevention of corruption involvement

The Risk Management Committee has determined additional guidelines on the prevention of corruption involvement, with three measures as follows : 1) Process in the assessment of fraud risk 2) Supervision and control practices to prevent and monitor fraud risk, and 3) Guidelines on monitoring and evaluation of compliance with guidelines on the prevention of corruption involvement. The guidelines have been considered by the Audit Committee and approved by the Board of Directors on February 28, 2014, constituting part of the Company’s Good Corporate Governance and Business Ethics Manual, which can be summarized as follows : Fraud Risk Assessment Process The Company has put in place a risk management system suitable to the Company’s business nature, aiming to prevent and combat fraud and corruption by identifying incidents of high fraud and corruption risks that may arise from business operations, estimating possibility and impact determining proper measures to combat fraud and corruption, suitable to the assessed risks, methods to measure the success and resources utilized in risk mitigation and evaluating the performance under the established risk management plan. Supervision and control practices to prevent and monitor fraud risk The Company has established supervision and control practices to prevent and monitor fraud and corruption risks, which can be summarized as follow : 1. Put in place the audit process, internal control and risk management systems covering key operating systems, such as, sales and marketing, purchasing, contract preparation, account recording, payment systems, etc., aiming to prevent and monitor fraud and corruption risk and provide suitable guidelines in resolving problems. 2. Provide channels for receiving information, clues or complaints on breaches of laws or the Company’s business ethics or guidelines on the prevention of corruption involvement or suspicious abuse in ųnancial reports or internal control systems, with a policy to protect the providers of information or clues and treat the received information with conųdentiality, including measures on investigation and punishment under the Company’s discipline and/or related laws. In case the provider of information or clues or the complainant can be contacted, the Company will give a written reply on the Company’s action for information. 3. The relevant department’s head is responsible for monitoring the action, correcting the error (if any) and reporting to the person in a position of authority. Guidelines on monitoring and evaluating compliance with the guidelines on the prevention of corruption involvement The Company has determined guidelines on monitoring and evaluating compliance with the guidelines on the prevention of corruption involvement as follows : 1. Executives and employees are required to regularly appraise their own performance on compliance with the Good Corporate Governance and Business Ethics Manual of the Company, which contains policies on good corporate governance, business ethics, ethics on support to fraud and corruption counteracting, guidelines on the prevention of corruption involvement and employees’ ethics and code of conduct. 2. Internal Audit Ofųce is set up to oversee the internal control system, risk management and corporate governance, to provide recommendations continuously by conducting audit in accordance with the annual audit plan approved by the Audit Committee and report signiųcant results of the audit with recommendations to