- 3 - 4. TRANSACTIONS WITH RELATED COMPANIES The Company has certain transactions with related companies. These companies are related through common shareholdings and/or directorships. The financial statements reflect the effects of these transactions on the basis determined by the companies concerned, which are in the normal course of business. A summary of revenues and expenses with related companies during the six-month periods ended June 30, were summarized as follows: In Thousand Baht Consolidated For the Company 1998 1997 1998 1997 Revenues 247,536 136,028 269,969 161,181 Expenses 12,952 13,482 14,448 15,827 Receivables from and payables to related companies as at June 30, were summarized as follows: In Thousand Baht Consolidated For the Company 1998 1997 1998 1997 Receivables 109,427 126,743 89,608 70,401 Payables 5,882 11,219 3,035 4,803 Loans to related companies as at June 30, were summarized as follows: In Thousand Baht Consolidated For the Company 1998 1997 1998 1997 Siam Retail Development Co., Ltd 175,598 152,151 175,598 152,151 Central Realty Service Co., Ltd. - - 18,936* - Lang Suan Realty Co., Ltd. - - 62,091 28,980 Central Food Avenue Co., Ltd. - - 8,311* - Focus Holding Co., Ltd. - - 394,844 494,505 Central Pattana Chiang Mai Co., Ltd. - - 713,822 550,652 - 4 - In Thousand Baht Consolidated For the Company 1998 1997 1998 1997 Central Pattana Ko Raj Co., Ltd. - - 55,399 190,086 Food Novelties Co., Ltd. - - 45,171 - Coffee Partners Co, Ltd. - - 4,746* - Central Pattana Khon Kaen Co., Ltd. - - 199,237 270,840 Central Pattana Nine Square Co., Ltd. - - - 4,263* Namsap Pattana Co., Ltd. - - - 181,844* Total 175,598 152,151 1,678,155 1,873,321 Less Allowance for doubtful account 43,899 - 43,899 - Net 131,699 152,151 1,634,256 1,873,321 * Short-term loans. Loans from related companies and a director as at June 30, were summarized as follows: In Thousand Baht Consolidated For the Company 1998 1997 1998 1997 Khun Winyu Kuwanun 1,290 696 - - Fairy Plaza Co., Ltd. 477 621 - - Big C Supercenter Public Company Limited 17,291 70,026 - - Central Superstore Co., Ltd. 31 31 - - Modern Tradition Co., Ltd. 806* - - - Central Realty Service Co., Ltd. - - - 40,552 Central Food Avenue Co., Ltd. - - - 9,449 Total 19,895 71,374 - 50,001 * Short-term loan. - 5 - 5. ACCOUNTING CHANGE FOR INCOME TAX Starting from April 1, 1997, the Company adopted the practice of recognizing income tax effects of transaction in the period in which they are entered into the determination of net income, regardless of when they are recognized for computation of income tax purpose. Accordingly, the income tax applicable to expenses which are not currently deductible for computation of income tax purposes are set up as deferred income tax in the balance sheets. This will be allocated to future periods when the expenses provided for are actually incurred and considered deductible for computation of income tax purpose, the change effective on January 1, 1997. 6. ACCOUNTS RECEIVABLE - TRADE The Company has outstanding accounts receivable more than 3 months and customers deposit as at June 30, 1998, which were classified by aging as follows: Consolidated In Thousand Baht Number More than More than of 3 months 6 months to More than Customers items to 6 months 12 months 12 months Total deposit Related companies 47 11,878 27,566 14,670 54,114 10,900 Others 427 30,453 33,602 23,631 87,686 116,820 Total 474 42,331 61,168 38,301 141,800 127,720 Allowance for doubtful account 4,895 For the Company In Thousand Baht Number More than More than of 3 months 6 months to More than Customers items to 6 months 12 months 12 months Total deposit Related companies 47 9,028 23,403 15,113 47,544 10,900 Others 179 11,075 15,994 10,252 37,321 84,490 Total 226 20,103 39,397 25,365 84,865 95,390 - 6 - 7. INVESTMENTS IN SHARES OF SUBSIDIARIES - Equity Method For the Company In Thousand Baht Percentage Business of Paid-up Investment 1998 Type Holdings Shares At Cost At Equity Dividend Central Realty Service Co., Ltd. (2) 99.99 1,000 1,000 93,068 75,000 Lang Suan Realty Co., Ltd. (3) 99.99 150,000 150,000 122,769 - Central Food Avenue Co., Ltd. (4) 99.99 1,000 1,000 11,506 - Focus Holding Co., Ltd. (1) 99.99 400,000 400,000 399,788* - Central Pattana Chiang Mai Co., Ltd. (1) and (4) 99.99 475,000 474,999 444,643 - Central Pattana Ko Raj Co.,Ltd. (1) 99.99 200,000 199,999 186,091* - Food Novelties Co., Ltd. (5) 99.99 1,000 1,000 (1,164) - Coffee Partners Co., Ltd. (5) 99.93 1,000 1,000 935* - Central Pattana Khon Kaen Co., Ltd. (1) 78.13 260,000 203,149 192,530* - Central Pattana Chonburi Co., Ltd. (1) 60.00 315,100 189,084 188,162* - Central Pattana Nine Square Co., Ltd. (1) 60.00 402,000 241,200 242,136* - Namsap Pattana Co., Ltd. (1) 50.00 100,000 324,926 368,619 - Total 2,187,357 2,249,083 75,000 - 7 - In Thousand Baht Percentage Business of Paid-up Investment 1997 Type Holdings Shares At Cost At Equity Dividend Central Realty Service Co., Ltd. (2) 99.99 1,000 1,000 145,510 - Lang Suan Realty Co., Ltd. (3) 99.99 150,000 150,000 134,884 - Central Food Avenue Co., Ltd. (4) 99.99 1,000 1,000 15,173 - Focus Holding Co., Ltd. (1) 99.99 100,000 100,000 99,851* - Central Pattana Chiang Mai Co., Ltd. (1) and (4) 99.99 475,000 474,999 468,333 - Central Pattana Ko Raj Co., Ltd. (1) 99.99 50,750 50,749 50,643* - Food Novelties Co., Ltd. (5) 99.99 1,000 1,000 1,000* - Central Pattana Khon Kaen Co., Ltd. (1) 61.74 148,630 91,779 93,674* - Central Pattana Chonburi Co., Ltd. (1) 60.00 315,100 189,084 188,245* - Central Pattana Nine Square Co., Ltd. (1) 60.00 390,000 234,000 235,192* - Namsap Pattana Co., Ltd. (1) 50.00 100,000 324,926 418,763* - Total 1,618,537 1,851,268 - (1) Construction of shopping center buildings for rent. (2) Utilities service in shopping center. (3) Construction of condominiums and shop houses for sales of leasehold right. (4) Sales of food and beverage. (5) Produce, sales and import food, biscuits and beverage. * Not yet started the intended business and/or temporarily stop projects. - 8 - 8. INVESTMENTS IN SHARES OF RELATED COMPANIES - Cost Method Consolidated In Thousand Baht Direct and 1998 Indirect Allowance Percentage of for Holdings Cost Net Book Declining 1998 1997 1998 1997 Value in Value Bangna Central Property Co., Ltd. 19.99 19.99 107,946 107,946 44,654 80,960 Jewelry Holding Co., Ltd. 17.20 17.20 2,869 2,869 -* 2,582 Siam Retail Development Co., Ltd. 15.00 15.00 66,250 66,250 -** 49,687 Square Ritz Plaza Co., Ltd. 12.00 12.00 15,000 15,000 14,933 11,250 Jewelry Realty Co., Ltd. 13.65 13.65 117,869 117,869 -* 106,082 Rachada Nonsee Department Store Co., Ltd. 19.00 19.00 68,966 57,000 45,224 - Ayudhaya Agrocity Co., Ltd. 11.85 10.00 50,397 45,597 39,107 - Other investment 0.14 - 1,000 - 480 - Total 430,297 412,531 250,561 For the Company In Thousand Baht Direct and 1998 Indirect Allowance Percentage of for Holdings Cost Net Book Declining 1998 1997 1998 1997 Value in Value Bangna Central Property Co., Ltd. 19.99 19.99 107,946 107,946 44,654 80,960 Jewelry Holding Co., Ltd. 17.20 17.20 2,869 2,869 -* 2,582 Siam Retail Development Co., Ltd. 15.00 15.00 66,250 66,250 -** 49,687 Square Ritz Plaza Co., Ltd. 12.00 12.00 15,000 15,000 14,933 11,250 Jewelry Realty Co., Ltd. 13.65 13.65 117,869 117,869 -* 106,082 Ayudhaya Agrocity Co., Ltd. 11.85 10.00 50,397 45,597 39,107 - Other investment 0.14 - 1,000 - 480 - Total 361,331 355,531 250,561 * No information ** Capital deficiency Net book value of the investee companies based on audited financial statements for the year ended December 31, 1997. 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