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NOTES TO THE FINANCIAL STATEMENTS (cont’d)
31 DECEMBER 2012
40 CAPITAL MANAGEMENT
The Group considers its capital to be comprised of its ordinary share capital, retained earnings and distributable
reserves.
The Group’s objectives when managing its capital are to safeguard the Group’s ability to continue as a going concern
and to maintain an optimal capital structure so as to maximise shareholders value. In order achieve this objective, the
Group seeks to balance risk and returns at an acceptable level and also to maintain a sufficient funding base to enable
the Group to meet its working capital and strategic needs. Where necessary, adjustments to the amount of dividends
paid to shareholders or the issuance of new shares may be considered.
There have been no significant changes to the Group’s capital management objectives, policies and processes in the
year nor has there been any change in what the Group consider to be its capital.
The Group manages its capital based on debt-to-equity ratio. The debt-to-equity ratio is calculated as net debt divided
by total equity attributable to the owners of the parent. Net debt is calculated as borrowings plus trade and other
payables less cash and cash equivalents.
The debt-to-equity ratio of the Group at the end of the reporting period is as follows:
2012
RM
Group
Finance lease and hire purchase payables 41,558,083 53,421,325
Bank borrowings - 3,943,546
Trade payables 1,568,010 2,363,185
Other payables 11,198,955 32,317,554
Shareholders’ advance 1,726,811 6,231,949
2011
RM
56,051,859 98,277,559
Less:
Cash and bank balances (17,909,658) (19,241,908)
Cash and bank balances, attributable to disposal group, net of financial liabilities - (26,819)
Net debt 38,142,201 79,008,832
Total equity attributable to the owners of the parent 63,329,856 43,995,678
Debt-to-equity ratio 0.60 1.80
Gunung Capital Berhad (330171-P)
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annual report | 2012