1. GENERAL INFORMATION
The Post Publishing Public Company Limited ("the Company") was incorporated as a public limited company under Thai laws. The Company operates its business in Thailand and its principal activity is the publishing and distribution of newspapers, magazines and books. The Company is located at 136 Sunthorn Kosa Road, Kwang Klong Toey, Khet Klong Toey, Bangkok.

2. BASIS OF CONSOLIDATION
2.1 The consolidated financial statements incorporate the financial statements of the Company, and the following subsidiaries and joint ventures.


3. SIGNIFICANT ACCOUNTING POLICIES
The financial statements have been prepared in accordance with accounting standards pronounced by the Institute of Certified Accountants and Auditors of Thailand, and the Accounting Act B.E. 2543, except for the accounting policy for deferred income tax which is accounted for in accordance with International Accounting Standards since deferred income tax has yet to be addressed by any Thai Accounting Standard (see Note 3.6).

Significant accounting policies adopted by the Company and subsidiaries are summarised below.

3.1 Revenue recognition
Revenues from sales are recognised when the title to the goods sold passes to the customers, which is generally at the time when goods are dispatched to the customers as ordered. Newspapers subscription revenue is recognised in the month in which the subscriptions invoices are issued.

Service income is recognised when the service has been rendered. Advertising revenues are normally considered to be rendered when the relevant publication is issued.

3.2 Trade accounts receivable and allowance for doubtful accounts
Trade accounts receivable are stated at their net realisable value. Allowance for doubtful accounts is provided for the estimated collection losses that may incur in the collection of receivables. The allowance is based on collection experience and the current status of receivables outstanding at the balance sheet date.

3.3 Inventories
Inventories are valued at the lower of cost (determined by the first-in, first-out method) and net realisable value.

3.4 Property, plant and equipment / Depreciation
Property, plant and equipment are stated at cost less related accumulated depreciation. Depreciation of plant and equipment is calculated by reference to their costs on a straight-line basis over the following estimated useful lives:-


No depreciation has been provided for land and machinery and equipment under installation.

3.5 Investments
Investments in subsidiaries and joint ventures, as presented in the separate financial statements of the Company, are accounted for by the equity accounting method.

Investments in unit trusts of mutual funds which the Company intends to hold as available-for-sales securities are determined at fair value. Changes in the value of the securities are separately shown in shareholders' equity under the caption of "Unrealised gains from changes in fair value of investments in available-for-sales securities".

Long-term investments in non-marketable equity securities, which the Company classifies as investments in other companies, are carried at cost, net of allowance for impairment (if any). The Company recognises loss on impairment of investments in other companies in the earnings statements when the fair value of the investment is lower than the cost.

Investments in debt securities held to maturity are stated at amortised cost. The Company recognises loss on impairment of the investments in the earnings statements when the fair value of the investments is lower than the cost.

3.6 Deferred income tax
The Company accounts for deferred income tax arising from temporary differences in the recognition of income and expenses for accounting and tax purposes, using the liability method, to the extent that the deferred tax asset or liability is expected to be able to be reversed to income and expenses in the future.

This accounting policy is adopted in accordance with International Accounting Standards since deferred income tax has yet to be addressed by any Thai Accounting Standard.

3.7 Foreign currency
Transactions in foreign currencies are translated into Baht at the rates ruling at the transaction dates. Monetary assets and liabilities denominated in foreign currency outstanding at the balance sheet date are translated into Baht at the rates ruling at the balance sheet date with the exception of those covered by forward exchange contracts, which are translated at the contracted rates.

Exchange gains and losses are included in determining earnings.

3.8 Financial instruments
The Company and subsidiaries have no policy to speculate in or engage in the trading of any financial derivative instruments. Financial instruments carried in the balance sheets include cash and cash equivalents, accounts receivable, accounts payable, lendings, borrowings and investments in debt securities held to maturity. The particularly recognition methods adopted are disclosed in the individual policy statements associated with each item.

3.9 Basic earnings per share
Basic earnings per share is calculated by dividing earnings for the year by the number of ordinary shares in issue during the year.

3.10 Use of accounting estimates
Preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates for certain accounting transactions, affecting amounts reported in the financial statements and notes related thereto. Subsequent actual results may differ from these estimates.

4. SHORT-TERM INVESTMENTS

NOTES TO CONSOLIDATED
FINANCIAL STATEMENTS (Continued)