Annual Report 2011 - Mandarin Oriental Hotel Group

28 Related party transactions
Annual Report 2011 71
The parent company of the Group is Jardine Strategic Holdings Limited (‘JSH’) and the ultimate holding company of
the Group is Jardine Matheson Holdings Limited (‘JMH’). Both companies are incorporated in Bermuda.
In the normal course of business, the Group undertakes a variety of transactions with its associates and with JMH and
its subsidiaries and associates. In addition, the Group paid a management fee of US$0.3 million (2010: US$0.2 million)
to Jardine Matheson Limited (‘JML’), a subsidiary of JMH, being a fee of 0.5% of the Group’s net profit in consideration
for certain management consultancy services provided by JML. The Group also received rental payment in respect of
a residential property from JML based on normal market terms of US$0.6 million (2010: US$0.5 million). The Group
has US$0.1 million payable to JML as at 31st December 2011 (2010: nil).
During 2011, the Group managed five (2010: five) associate hotels and received management fees of US$12.4 million
(2010: US$10.9 million) based on long-term management agreements on normal commercial terms. The outstanding
balances with associates are set out in debtors and prepayment in note 14.
The Group uses Jardine Lloyd Thompson (‘JLT’), an associate of JMH, to place certain of its insurance.
Brokerage fees and commissions, net of rebates, paid by the Group in 2011 to JLT amounted to US$0.6 million
(2010: US$0.5 million). The Group has no outstanding balance with JLT as at 31st December 2011 (2010: nil).
The Group provides hotel management services to Hongkong Land (‘HKL’), a subsidiary of JSH. Total management
fees received from HKL in 2011 amounted to US$3.0 million (2010: US$0.8 million), based on long-term management
agreements on normal commercial terms.
Details of Directors’ emoluments (being the key management personnel compensation) are shown on page 78 under the
heading of ‘Directors’ appointment, retirement, remuneration and service contracts’.
29 Summarized balance sheet of the Company
Included below is certain summarized balance sheet information of the Company disclosed in accordance with
Bermuda Law:
2011 2010
US$m US$m
Subsidiaries at cost 862.5 768.0
Net current liabilities (1.0 ) (1.1 )
Net operating assets 861.5 766.9
Share capital (refer note 20) 49.8 49.9
Share premium (refer note 21) 180.1 179.0
Revenue reserves and other reserves 631.6 538.0
Shareholders’ funds 861.5 766.9
Subsidiaries are shown at cost less amount provided.