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24. OpERATING lEASES
Leases as lessee
operating lease rentals are repayable as follows:
Masterskill Education Group Berhad / Annual Report 2012
105
NOTES TO THE FINANCIAL STATEMENTS (CONT’D)
Group
31.12.2012 31.12.2011 1.1.2011
Rm’000 Rm’000 Rm’000
Less than one year 667 1,144 2,148
Between one and five years 29 486 431
696 1,630 2,579
The Group leases computer equipment and advertisement board under operating leases. The leases run for a period of 1 to 3
years with an option to renew the lease after that date. Lease payments are increased every 3 years to reflect market rentals.
None of the lease includes contingent rentals.
25. COmmITmENTS
31.12.2012
Group
31.12.2011 1.1.2011
Rm’000 Rm’000 Rm’000
Capital commitments:
Property, plant and equipment
Contracted but not provided for 11,534 54,091 56,622
26. CONTINGENCIES
The Directors are of the opinion that provisions are not required in respect of the following matters, as it is not probable that a
future sacrifice of economic benefits will be required or the amount is not capable of reliable measurement.
In October 2006, a subsidiary, Masterskill (M) Sdn. Bhd. (“Masterskill”) entered into a sale and purchase agreement (the “SPA”)
with Kemacahaya Development Sdn. Bhd. (“KDSB”) and Syarikat Kemacahaya Sdn. Bhd. (“SKSB”), pursuant to which SKSB and
KDSB agreed to sell six (6) property units at Jalan Kemacahaya 11, Taman Kemacahaya, Batu 9, 43200 Cheras, Selangor (the “Six
Properties”) to Masterskill for RM2,000,000. The Six Properties are part of Masterskill’s current Cheras university college campus
and KDSB and SKSB were the original developer and proprietor of the Six Properties.
Upon the advice of Masterskill’s lawyers, Masterskill withheld payment of the balance purchase price for the Six Properties
under the SPA due to a dispute with KDSB and SKSB. In November 2006, after Masterskill had lodged a caveat over the Six
Properties, KDSB sought to terminate the SPA and repossess the Six Properties. They subsequently entered into a sale and
purchase agreement to sell the Six Properties to Pasupathy a/l Kanagasaby (“K. Pasupathy”), who then sought possession of the
Six Properties.
At the same time, two individuals, Chin Yam Meng (“CYM”) and Leng Kok Onn (“LKO”), attempted to enter the premises of
the Masterskill’s Cheras university college campus, claiming to be the lawful owners of the Six Properties due to arrangements
that they had made with Megatalent Sdn. Bhd. (“Megatalent”) in 2004, pursuant to which Megatalent had purportedly assigned
its rights to the Six Properties to CYM and LKO. By way of background, prior to the execution of the SPA, Megatalent had been
KDSB’s and SKSB’s marketing agent for a number of properties, including the Six Properties. In connection with this marketing
relationship and to facilitate the marketing of these properties, KDSB and SKSB had assigned or sold the properties, including the
Six Properties, to Megatalent. However, the agreements pursuant to which these properties were assigned or sold to Megatalent
were subsequently rescinded and the caveats which CYM and LKO had lodged over the Six Properties were removed in July
2006 prior to Masterskill entering the SPA.