Li & Fung Ltd
Introduction
Li & Fung is a listed company in Hong Kong, therefore it should comply with the relevant regulation, e.g. Listing Rules, HK Companies Ordinance and Hong Kong Financial Reporting Standards. Now we are going to discuss whether the information provided in its interim reports for the period ended 30 June 2010 is comply with the relevant regulation and sufficient to enable investors to make investment decisions.
Management Discussion & Analysis
In this aspect, basically the disclosure of Li & Fung is complied with the relevant regulation. The section of “Management Discussion and Analysis” contained the basic information including the business review, discussion and analysis of the performance, significant investment and event and the material factors underlying its result and financial position.
• It mentioned the turnover of first half of 2010 increased by 12%, reflecting the effects of nascent economic recovery in US together with contributions from previous acquisitions and outsourcing deals, however the management did not explain how the acquisitions contribution the company? What kind of acquisitions are they?
• The management disclosed the group entered into a landmark sourcing arrangement with Wal-Mart Stores, and made five small acquisitions and two large acquisitions during the period, however they did not mention the funding of them, the future prospects of the acquisitions, why the management take this decisions.
• The management addressed that US continued to be the Group’s key export market, representing 67% of total turnover, however they didn’t mention how they eliminate and assess the risk come from the US economy. As after the financial tsunami, US economy is in very difficult position, every policy from US government (e.g. quantitative easing, interest rate policy) would affect the group. Therefore the management should discuss and analysis more deeply about the relationship between the company and US, let the
Li & Fung is a listed company in Hong Kong, therefore it should comply with the relevant regulation, e.g. Listing Rules, HK Companies Ordinance and Hong Kong Financial Reporting Standards. Now we are going to discuss whether the information provided in its interim reports for the period ended 30 June 2010 is comply with the relevant regulation and sufficient to enable investors to make investment decisions.
Management Discussion & Analysis
In this aspect, basically the disclosure of Li & Fung is complied with the relevant regulation. The section of “Management Discussion and Analysis” contained the basic information including the business review, discussion and analysis of the performance, significant investment and event and the material factors underlying its result and financial position.
• It mentioned the turnover of first half of 2010 increased by 12%, reflecting the effects of nascent economic recovery in US together with contributions from previous acquisitions and outsourcing deals, however the management did not explain how the acquisitions contribution the company? What kind of acquisitions are they?
• The management disclosed the group entered into a landmark sourcing arrangement with Wal-Mart Stores, and made five small acquisitions and two large acquisitions during the period, however they did not mention the funding of them, the future prospects of the acquisitions, why the management take this decisions.
• The management addressed that US continued to be the Group’s key export market, representing 67% of total turnover, however they didn’t mention how they eliminate and assess the risk come from the US economy. As after the financial tsunami, US economy is in very difficult position, every policy from US government (e.g. quantitative easing, interest rate policy) would affect the group. Therefore the management should discuss and analysis more deeply about the relationship between the company and US, let the