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Notes To The Financial Statements
VITROX CORPORATION BERHAD
[649966-K]
For The Financial Year Ended 31 December 2008
24. CONTINGENT LIABILITIES - UNSECURED
The Group
A subsidiary, ViTrox Technologies Sdn. Bhd. (“VTSB”), has initiated a claim against a former employee (first defendant) who was
suspected to have copied its source code and produced automated vision inspection system to be sold through a third party
(second defendant).
On 27 December 2005 and 6 March 2006, the second and first defendants respectively issued a writ of summons against VTSB
claiming that VTSB had published a statement that is defamatory to them in VTSB’s corporate directory. VTSB has been advised
by its legal adviser that at this stage the quantum of damages cannot be determined as damages (if any) that are to be awarded
in a defamation action are to be assessed by the Court having the benefit of evidence adduced during trial.
Accordingly, no provision for any contingent loss in respect of actual cost and expenses incurred is made in the financial
statements.
25. FINANCIAL INSTRUMENTS
Recognised Financial Instruments
The information about the extent and nature of significant recognised financial instruments is disclosed in the individual notes
associated with each item.
Unrecognised Financial Instruments
The Group and the Company do not have any unrecognised financial instruments other than the contingent liabilities as
disclosed in Note 24 to the financial statements.
Fair Values
The carrying amounts of financial assets and liabilities of the Group and the Company as at 31 December 2008 and 2007
approximate their fair values.
It is not practicable to estimate the fair values of contingent liabilities reliably due to the uncertainties of timing, cost and
eventual outcome.
26. FINANCIAL RISK MANAGEMENT
The activities of the Group expose it to certain financial risks, including currency risk, credit risk and liquidity risk. The overall
financial risk management objective of the Group is to maximise shareholders’ value by minimising the potential adverse
impacts of these risks on its financial position, performance and cash flows.
The Board of Directors explicitly assumes the responsibilities of financial risk management which is carried out mainly through
risk reviews and internal control systems.