Clarification of impact of change in accounting policy

BackMay 15, 2007

May 15, 2007

Subject : Clarification of impact of change in accounting policy

Attn. : Director and Manager The Stock Exchange of Thailand

Asian Property Development Public Company Limited would like to report on the effect of the change in accounting for investment in subsidiary as follows:

Since January 1, 2007, the Company has changed its accounting policy regarding investment in subsidiary company so that the separate financial statement, which formerly reported investment using the equity method, now reports using the cost method. This is to comply with TAS 44. Thus, the Company restated its financial statement by using the historical cost as the cost of the investment in subsidiary companies of the separate financial statement. This adjustment caused the net income on the separate financial statement to differ from that reported in the consolidated financial statement. The Company had net income of Baht 158.30 million for the three-month period end March 31, 2007, according to the consolidated financial statement, however, the separate financial statement over the same period showed a net income of Baht 95.74 million. Therefore, the Company would like to clarify with the additional information as following:

1. After restating, net income for the three-month period ended March 31, 2007, and the comparable period in 2006 decreased by Baht 62.56 million and Baht 51.06 million, respectively.

2. The effect from the restating to other items on the separate financial statement for the three-month period ended March 31, 2007, such as investment in subsidiary and the retained earning on the balance sheet, decreased by Baht 1,610.32 million.

However, the change of accounting policy affects only the separate financial statement. It did not have any effect on the consolidated financial statement or business fundamentals.

Please be informed accordingly.

 

Sincerely yours,

 

Mr.Pichet Vipavasuphakorn
Managing Director