Sasbadi Annual Report 2017

NOTES TO THE FINANCIAL STATEMENTS 133 ANNUAL REPORT 2017 25. Contingencies The Directors are of the opinion that provisions are not required in respect of these matters, as it is not probable that future sacrifice of economic benefits will be required or the amount is not capable of reliable measurement. Group Company Note 2017 2016 2017 2016 RM’000 RM’000 RM’000 RM’000 Bank guarantees obtained by the Group to the Ministry of Education 25.1 643 338 - - In respect of corporate guarantees issued for subsidiaries - - 32,188 13,487 25.1 As part of the agreements with the Ministry of Education, the Group has issued performance bond in the form of bank guarantees to the Ministry of Education for the supply of text books and applied learning products. Material litigation Sasbadi Sdn. Bhd. (“SSB”), a wholly -owned subsidiary of the Company, had on 21 July 2017, received a copy of the sealed Writ and Statement of Claim dated 29 June 2017 from Messrs Skrine, acting on behalf of Penerbitan Pelangi Sdn. Bhd. (“PPSB”). The legal suit brought against SSB was due to the alleged infringement of PPSB’s copyright by SSB resulting from SSB’s publishing and sales of books on past year question papers for the Sijil Tinggi Persekolaha n Malaysia (“STPM”) examination and the Malaysian University English Test (“MUET”) under the publishing agreement entered into on 13 March 2017 between SSB and Majlis Peperiksaan Malaysia (“MPM”). SSB had on 30 August 2017, via its solicitors, filed its defence against the claim and submitted a counterclaim. SSB had, on 27 September 2017, via its solicitors, received a reply whereby PPSB denied SSB’s counterclaims and SSB is put to strict proof of the said claims. The Court has fixed the trial of this action from 18 April 2018 to 20 April 2018 and SSB is currently seeking advice from its solicitors to defend against this matter. The Directors are of the opinion that provisions are not required in respect of this matter, as it is not probable that a future sacrifice of economic benefits will be required or the amount is not capable of reliable measurement. 26. Capital and other commitments Group 2017 2016 RM’000 RM’000 Capital expenditure commitments Property, plant and equipment Authorised but not contracted for - 2,600