1992 — Page 56

SCHEME OF CONTROL STATEMENT

FOR THE YEAR ENDED 31ST DECEMBER, 1992

The financial operations of the Company are governed by a profit control scheme, the main features of which are as follows:

a.

b.

C.

d.

The annual permitted return of the Company is fixed at 16% of the average net fixed assets, including spare parts and stores used for bus operations.

Any difference between the annual permitted return and the adjusted profit after taxation is to be transferred to or from a development fund.

The following are to be deducted from the permitted return :

(i)

a charge of 8% p.a. on the average balance of the development fund which is to be added to the development fund, and

(ii) interest up to a maximum of 8% p.a. on borrowed capital.

The operation of the scheme commenced on 1st September, 1975, and is subject to review by Government

every two years.

The calculations shown below are in accordance with these agreements :

1992

HK$'000

1991

HK$'000

Profit subject to Control Scheme

345,710

348,644

Transfer from/(to) Development Fund

3,163

(29,427)

Annual Permitted Return

348,873

319,217

Deduct:

Interest on development fund

2,322

1,177

Interest at up to 8% p.a. on borrowed capital

34,278

35,199

312,273

282,841

Add:

Items not ranking for scheme of control

18,215

15,474

Profit attributable to Shareholders

330,488

298,315

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