Investor Presentaiton
HKAS 1.51(a)
HKAS 1.49
HK Listco Ltd
Financial statements for the year ended 31 December 2023
(c)
Leasing arrangement 288, 291
A16(8)(2)
(d)
In January 2022, the group entered into a three-year lease in respect of certain leasehold properties
from a fellow subsidiary of the group for storage of electronic goods. The amount of rent payable by the
group under the lease is $100,000 per month, which was determined with reference to amounts charged
by the fellow subsidiary to third parties. At the commencement date of the lease, the group recognised
a right-of-use asset and a lease liability of $3,303,000.
Applicability of the Listing Rules relating to connected transactions
[The related party transactions in respect of ... and ... above constitute connected transactions or
continuing connected transactions as defined in Chapter 14A of the Listing Rules. The disclosures
required by Chapter 14A of the Listing Rules are provided in section [...] of the Directors' Report.] OR [The
related party transactions in respect of ... and... above constitute connected transactions or continuing
connected transactions as defined in Chapter 14A of the Listing Rules. However those transactions are
exempt from the disclosure requirements in Chapter 14A of the Listing Rules as they are [below the de
minimis threshold under Rule 14A.76(1)][or describe other exemption applicable to the transactions]] OR
[None of the above related party transactions falls under the definition of connected transaction or
continuing connected transaction as defined in Chapter 14A of the Listing Rules.] 291
A16(8)(2)
291
In accordance with paragraph 8(2) of Appendix 16 to the MBLRs, where a listed issuer includes in its annual report particulars of a
related party transaction or continuing related party transaction (as the case may be) in accordance with applicable accounting
standards adopted for the preparation of its annual financial statements, it must specify whether or not the transaction falls under
the definition of "connected transaction" or "continuing connected transaction" (as the case may be) in Chapter 14A of the MBLRs.
The listed issuer must also confirm whether or not it has complied with the disclosure requirements in accordance with Chapter 14A
of the MBLRs. In this regard, it would be helpful to the readers to provide a cross reference to where in the Annual Report such
disclosures have been made, where applicable.
According to the response to question 23 in FAQ Series 20 "Rule requirements relating to notifiable transactions, connected
transactions, mineral companies, issues of securities and corporate governance code" released by the Listing Division of the SEHK on
28 February 2013, when the related party transaction is a connected transaction but is exempt from the disclosure requirements of
Chapter 14A of the MBLRS, the listed issuer should specify this fact and describe the exemption applicable to the transaction.
In addition, according to the responses to FAQs on notifiable and connected transactions rules relating to lease transactions of listed
issuers adopting HKFRS/IFRS 16 "Leases" (or similar accounting standards in other jurisdictions) released by the Listing Division of the
SEHK (last update on 17 April 2020),
•
where the lease is subject to an agreement with fixed lease payments, the transaction is treated as a one-off connected
transaction and the recognition of a right-of-use asset is regarded as an acquisition of capital asset under the definition of
transaction set out in Main Board Rule 14.04(1)(a); and
where the lease is subject to an agreement with variable lease payments (such as turnover rent), these payments are treated as
continuing connected transaction under Main Board Rule 14A.31. The listed issuer is required to set annual caps on the variable
lease payments to be made each year under the agreement.
192
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