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Report of the Directors Report of the
Independent Auditors
32 VTech Holdings Ltd Annual Report 2005
3. the grant to the directors of a general authority to allot,
issue and otherwise deal with shares of the aggregate
amount of the shares repurchased under the repurchase
mandate and;
4. amendments to the Bye-laws of the Company.
The Directors believe that an authority given to the Directors to
allot and issue shares and to repurchase shares would give the
Company additional flexibility that would be beneficial. As for
the repurchase mandate, the Directors would only make a
repurchase in circumstances where they consider it to be in the
best interests of the Company and in circumstances where
they consider that the shares can be repurchased on
favourable terms.
The Hong Kong Stock Exchange has recently amended the
Listing Rules for the purpose of implementing the Code on
Corporate Governance Practices (the “Code”). In the Listing
Rules, the Code replaces the Code of Best Practice in Appendix
14 of the Listing Rules. Pursuant to Paragraph A.4.2 of the Code,
every director should be subject to retirement by rotation at
least once every three years. The existing Bye-laws of the
Company does not comply with the said Paragraph A.4.2 of the
Code and the Directors therefore propose the Special Resolution
as set out in the notice of the annual general meeting to amend
the existing Bye-laws of the Company.
Auditors In February 2003, PricewaterhouseCoopers resigned
as auditors of the Company and KPMG were appointed as the
auditors of the Company to fill the casual vacancy caused by the
resignation of PricewaterhouseCoopers.
The financial statements have been audited by KPMG, who
retire and, being eligible, offer themselves for re-appointment at
the forthcoming annual general meeting of the Company. A
resolution for the re-appointment of KPMG as auditors of the
Company will be proposed at the forthcoming annual general
meeting of the Company.
By Order of the Board
Allan WONG Chi Yun
Chairman
Hong Kong, 22nd June 2005
To the Shareholders of VTech Holdings Limited
(Incorporated in Bermuda with limited liability)
We have audited the consolidated financial statements of VTech
Holdings Limited (“the Company”) and its subsidiaries (“the
Group”) set out on pages 33 to 53 which have been prepared in
accordance with International Financial Reporting Standards
promulgated by the International Accounting Standards Board.
Respective Responsibilities of Directors and
Auditors These consolidated financial statements are the
responsibility of the Group’s directors who are required to
prepare financial statements which give a true and fair view.
Our responsibility is to express an opinion on these consolidated
financial statements based on our audit. This report is made solely
to the shareholders, as a body, in accordance with Section 90 of
the Bermuda Companies Act 1981, and for no other purpose. We
do not assume responsibility towards or accept liability to any
other person for the contents of this report.
Basis of Opinion We conducted our audit in accordance
with International Standards on Auditing as promulgated by the
International Federation of Accountants. Those standards require
that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free of
material misstatement. An audit includes examining, on a test
basis, evidence supporting the amounts and disclosures in the
financial statements. An audit also includes assessing the
accounting principles used and the significant estimates made by
the directors, as well as evaluating the overall financial statement
presentation. We believe that our audit provides a reasonable
basis for our opinion.
Opinion In our opinion the consolidated financial
statements give a true and fair view of the financial position of
the Company and of the Group as of 31st March 2005 and of
the Group’s profit and cash flows for the year then ended in
accordance with International Financial Reporting Standards
promulgated by the International Accounting Standards Board
and the disclosure requirements of the Hong Kong Companies
Ordinance and the Bermuda Companies Act 1981.
KPMG
Certified Public Accountants
Hong Kong, 22nd June 2005