Page 93 - Annual Report English 2018

Tycoons Worldwide Group (Thailand) Plc.

10. Advance payments for goods and services
(Unit: Thousand Baht)
Financial
statements in
which equity
method is applied/ Consolidated/
Separate financial Separate financial
statements statements
2018 2017
Advance payments for goods and services 260,381 255,485
Less: Allowance for doubtful debts (242,722) (244,450)
Advance payments for goods and services - net 17,659 11,035

In 2008, the Company entered into forward raw material purchase contracts with two
overseas companies, and made advance payments to these companies amounting to
USD 28 million (approximately Baht 932 million). The Company received some of the
raw materials, leaving advance payments of USD 17.23 million (approximately Baht
572 million) for raw materials that had yet to be received. However, due to the impact
of the economic crisis, the Company requested postponement of the delivery of
remaining raw materials.

Consequently in 2009, the Company notified its suppliers to deliver the remaining raw
materials per the contract, and that if they were not able to make delivery on schedule
without notification of the reason for this to the Company, the Company would
terminate the contracts and request the return of advance payments based on the
current market price for the outstanding raw materials. However, the Company did not

receive any contact from the suppliers regarding delivery of the raw materials, and so
wrote off Baht 282 million of the advance payments for goods, representing the excess
of the value of the raw materials at the contract prices over their value at the market
price as at the end of November 2009. The Company is pursuing collection of the
remaining USD 8.7 million (approximately Baht 219 million) of advance payment from
the two companies.The Company has set aside full allowance for doubtful debt
because it expects the remaining amounts will not be recoverable.

During the year 2010, a counterparty paid CNY 8.16 million (approximately USD 1.18
million or approximately Baht 39 million) through the Company’s overseas related
company and the Company reversed allowance for doubtful debt in the same amount.

Currently, the Company is in the process of pursuing the remaining debt and taking
legal action against the counterparty.
11. Restricted bank deposits

These represent fixed deposits pledged with the banks to secure credit facilities that
carried interests between 0.55 and 1.25 percent per annum (2017: between 0.55 and
1.40 percent per annum).

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