Proton Proxy Form

Operations Review
PROTON’s MPV, the Exora, goes into production.
PROTON 2009 ANNUAL REPORT 81

Operations Review
The Group also anticipates strong local demand for the Persona and Saga, while export
volume is expected to increase especially for the Exora with plans already in place to
introduce this vehicle to the ASEAN market in the second half of 2009. Furthermore, with
the expansion of the Overseas Manufacturing Plants in China and Iran, the export business
on completely–knocked–down (CKD) vehicles is expected to increase as well.
New robots and more sophisticated handling equipment were installed successfully with
minimal line disruptions. Previous PROTON production systems and Total Productive
Maintenance (TPM) activities have already resulted in the main plant having one of the
lowest downtimes in history and similar activities were implemented successfully in the
Casting and Engine Transmission Department. Much effort was taken to maintain this.
An increasing number of model lines or equipment was established through ‘yokoten’,

a Japanese term which essentially means duplicating. The next stage in these intensive
improvement activities will be the implementation of ‘Kobetsu Kaizen’ (which means
‘Focus Improvement’) and the usage of Overall Equipment Efficiency (OEE) as the de facto
parameter to measure equipment efficiency.
In view of PROTON’s commitment to improvement, the Manufacturing Division has

started implementing the world-renowned practice of ‘Genba Kanri’, another Japanese
term this time referring to ‘Shopfloor Control’. This is to reflect how the division is
continuously improving itself by benchmarking PROTON against world-class industry
players. We shall aim to reach level 4 (which means sustainable world-class level in
shop control) in ‘Genba Kanri’ by the year 2011.
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Operations Review
State-of-the-art equipment at our manufacturing facilities in Shah Alam.
PROTON Shah Alam

The main plant and the MVF are located in Shah Alam, with the combined total installed
capacity for both being 200,000 units per year. The casting, engine and transmission plant
is also in Shah Alam and has the capacity to produce 180,000 units of CamPro engines
annually.
The main plant has been producing 6,000 units of the Saga each month. The Perdana,
Waja, Wira and Arena are also produced here but in a much smaller volume. The current
production of the Wira is exclusively for the taxi market but the Wira will be discontinued
by around July 2009.
Thereafter, the taxi market will be supplied with the new PROTON Saga NGV which is a
1.6 litre engine installed with a specially designed NGV kit. Preparations are also underway
for a minor cosmetic enhancement to the new Saga for a special edition to be introduced
in the market by August 2009. In the same month, the Group will also start producing the
Saga for the Australian market.

Operations Review
The MVF was also given the task of producing the Exora. Produced in 18 months, this was
deemed an outstanding feat in the automotive world. Since the plant had previously been
manufacturing the Waja, all facilities had to be either modified or newly installed with
equipment to manufacture the MPV.
Daily meetings attended by top Management were held to ensure that the manufacturing
decisions were made quickly and in a decisive manner. Comprehensive online training and
quality improvement teams were formed using the PROTON Production System (PPS) as the
main driver. All cars had to also undergo tests to ensure that there was no rattling or other
noise defects.
Featuring an automatic transmission when it was first introduced, PROTON has in July
introduced a manual version of the Exora to cater especially for the Indonesian market.
The monthly production volume is targeted at 3,000 units per month and is expected to
increase when export to Indonesia begins. Following its introduction in Indonesia in July
2009, the Exora will be launched in Singapore, Brunei and Thailand.
PROTON Tanjung Malim

PROTON Tanjung Malim is the largest manufacturing and assembly plant within the Group.
The plant complex, which sits on 1,500 acres of land in the state of Perak, facilitates the
processes of engine machining, stamping, body assembly, painting and final assembly.
The plant has a capacity of 150,000 units per year and can operate on a two-shift basis.
However, due to the global economic crisis, since December 2008, the plant has been
running on one shift. By switching to one shift, PROTON was able to relocate excess
manpower to the MVF in preparation for the production of the Exora. As such, this enabled
the Company to minimise cost and retain skilled personnel.
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Operations Review
To boost sales in the wake of economic uncertainty in the domestic market, two up-graded
versions of existing models were introduced. The first was the Persona SE, which features
a more sporty style and was introduced in September 2008. Current production of the
Persona SE is estimated at 500 units per month.
The second upgrade was the Satria Neo High Line version which is equipped with a
CamPro CPS (Cam Profile Switching) engine. The improved, now trendier Satria Neo CPS
comes with a stylish new front and rear bumper, as well as a new leather interior. As it is
exclusively targeted for a limited market, the production volume is only at 60 units per
month currently.
Plans for the Persona NGV and Persona cosmetic change productions are already on the
drawing board and mass productions are expected to begin by the end of 2009.
PROTON’s plant in Tanjung Malim is the largest of the Group’s manufacturing facilities.

Operations Review
Improving plant operational efficiencies will be a key focus in the next financial year.
Prospects
Total production volume for the next financial year is forecasted to increase by 3% to
162,000 units. The single digit increase is a result of the cautious tone adopted by the
market due to the global economic crisis, which has undoubtedly impacted the world car
market.
As the overseas market has been severely affected, approximately 90% of the volume is
being allocated for the domestic market, with the remaining 10% reserved for export.
Production volume is expected to utilise less than 50% of PROTON’s installed plant capacity
and all plants are expected to operate on a one-shift basis in the new financial year.
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Operations Review
Production of the Exora is expected to

receive a further boost once launched
into the Indonesian market.
The loss of volume has motivated the Group to further improve operational efficiencies
and to enhance cost reduction activities. PROTON is confident that all the proposed cost
reduction initiatives will be carried out accordingly.
On the other hand, demand for the Saga is expected to stablise in the domestic market,
while an increase in production volume is anticipated when exports to Australia and the
Gulf Community Countries (GCC) begin. The cosmetic change and special edition models
also provide a positive outlook for the Saga.
The Group also forsees that the high number of bookings for the Exora would result in
high volumes in excess of 3,000 units a month. Export to the Indonesian market slated for
July 2009 will further boost production volume. The plan for the new financial year is to
produce 35,000 units and we expect this target to be achieved, if not, exceeded.
While demand for the Exora is on the rise and demand for the Persona and Saga is stabilising,
the corresponding requirement for the CamPro engines is as per the last financial year.
The CamPro engine component machine and assembly capacity expansion plans are also
constantly being reviewed and we anticipate that the current capacity of 180,000 units will
be sufficient to cater for the coming year.

Operations Review
LOTUS
Operations
Against the backdrop of profitability in the previous
During the course of the fiscal year, Lotus produced
financial year, Lotus was confident of further
2,202 vehicles compared to 2,649 units in the previous
improving its performance in 2009 in line with its
year. This included the production of 388 Tesla all-
Strategic Business Plan before the turn of events
electric roadsters.
in September 2008 which culminated in the global
financial and economic crisis.
In order to improve sales, Lotus introduced new
derivatives to refresh its current model line-up which
Nevertheless, for the fiscal year ended 31 March 2009,
include the Europa SE, Exige 260, 2-Eleven 190 as well
Lotus increased its turnover to £110m or RM574.8m
as the restyled 2010 model year Exige launched at the
compared to £108m or RM564.3m in the year before.
March 2009 Geneva Motorshow. As a result, Lotus
This was underpinned by the diversity of the Lotus
saw better global market penetration compared to
business driven by the growth in third party high
its competitors in most territories.
technology engineering consultancy revenue, the
ability of the Cars Division to act swiftly to negate the
In July 2008 Lotus’ first new model in 13 years, the
impact of the global downturn and the contribution
Evora, was unveiled at the British International
of Lotus Light Weight Structures.
Motorshow to international acclaim. The world’s
first mid-engine 2+2 supercar had its formal press
As a net exporter of its products and services, a
launch in Scotland in May 2009 resulting in the
weakening sterling at the time had benefited Lotus
Evora dominating the global media headlines.
and acted as a self-hedging mechanism for non-
sterling denominated costs. Conversely, however,
the volatile movement of the sterling against world
currencies also resulted in substantial unrealised
foreign exchange losses which together with
provisions for bad debts, pension protection levy
and asset impairment contributed adversely to the
net loss posted.
The Evora, which was launched in 2008, was Lotus’ first new model in
13 years.
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Operations Review
Evora’s successful press launch is a clear reflection

of the niche vehicle product engineering capability
of Lotus Cars which attracted hundreds of orders and
a substantial number of road test requests and firm
enquiries from prospective buyers even before the
planned sales launch.
It took a clean sheet of paper and a little over 27

months to design, develop and validate the Evora
and put it into production. This supercar, remains
Lotus Evora was unveiled at the British Motorshow.
true to Lotus’ heritage and core philosophies of being
Visually Stunning, Exhilarating, Agile and Responsive. investments in outsourced projects towards the end
Production of the Evora began early 2009 with first of 2008.
deliveries to customers commencing in June.
The growth follows years of proactive market-driven
In anticipation of the Evora sales launch and to lay the policies to expand and market clear core product
foundation for future new models, Lotus continued offerings and improve the global sales and delivery
to focus on strengthening its global distribution process. An example of new high technology domains
and dealer networks. Markets now include Saudi acquired as a result of this policy are EV (electrical
Arabia, Indonesia and Taiwan, bringing the current vehicle), bio fuels and hybrid technologies which are
total dealer-distributor network to 162 across 42 moving towards becoming leading world ecological
countries. products.
In addition, Lotus, through its high technology Lotus Engineering successfully completed the
engineering consultancy division, continued to development of its well-publicised EV sports car for
provide worldwide year-on-year incremental third a western OEM which has been showcased in various
party business with turnover from the division auto shows. Lotus is also proud to have successfully
increasing by 23%. This is a significant achievement carried out mutual engineering, development and
given that OEMs and other engineering clients have showing in China of its EVs based on the Saga and
scaled back their product plans and deferred some Persona platforms with parent company, PROTON.

Operations Review
Lotus continues to take advantage of its Engineering was the proud recipient of the prestigious
competencies and brand heritage to pursue and historic 2008 Dewar Trophy from the Royal
engineering opportunities and expand its business Automotive Club in recognition of its outstanding
into emerging economies in which demand for high technical excellence in pioneering the Versatile
technology engineering is rapidly growing. Lotus Vehicle Architecture chassis technology.
Engineering plans to explore establishing subsidiary
companies in emerging economies, including India. The fiscal year also saw Lotus complete the
It currently has a presence in six countries: United strategic acquisition of Holden Light Weight
Kingdom, United States, Malaysia, China, Germany Structures Limited (now known as Lotus Light Weight
and Japan. Structures Limited) which produces the unique
aluminum platforms of Lotus and other leading OEM
By leveraging on the global business recognition of products. This acquisition allows access to critical
being at the forefront of green technology, Lotus intellectual property in the area of light weight
Engineering secured matched funding from the technology which is becoming increasingly important
Technology Strategic Board (TSB) and other in the improvement of vehicle performance and
governmental bodies for R&D on new green and efficiency in the transportation industry.
revolutionary technologies. In March 2009 Lotus
Prospects
The year ahead will see Lotus, like other companies in the automotive industry, being faced
with ever-changing industry dynamics as companies emerge from the current global crisis.
The primary focus is to ensure that the business continues to grow and remains relevant to
our stakeholders.
Lotus Cars will continue to capitalise on the current success of the Evora, strengthening
and building its global dealer network and expanding market coverage to include China
and India. The Evora will be launched in North America in early 2010, with an automatic
variant (6 speed torque converter type) to be unveiled in 2011. In tandem, the small
platform vehicles (Elise and Exige) will be developed to meet a multitude of new legislative
requirements for all markets.
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Operations Review
A Lotus showroom in Europe.
Lotus also has an on-going contract to produce Tesla all-electric roadsters, while there
are several potential opportunities to further expand Lotus’ third party manufacturing
business.
The focus for Lotus Engineering will be to continue to expand and grow by generating
new opportunities that leverage on its high technology know-how which include driving
dynamics, niche vehicles, efficient performance as well as EV and HEV (hybrid electrical
vehicle).
Likewise, Lotus Light Weight Structures Limited will continue to provide expertise in light
weight technologies by leveraging on Lotus Engineering’s network and capabilities.
Lotus believes that it is now on a sound footing and ready to embark on the next phase of
an 8-Year Strategic Business Plan thanks to the tremendous support from parent company
PROTON, employees, customers and suppliers. There is no doubt that the coming year
will continue to be challenging given the prevailing weak consumer sentiments and
market conditions. Nevertheless, Lotus is cautiously optimistic of an improved financial
performance in the next financial year spurred by the sales of Evora.

Operations Review
Quality Management
It is unwise for any organisation to believe that quality
only means producing products that are reliable and meet
customers expectations.
Quality excellence must transcend all aspects of a business as well as corporate culture
in order for an organisation to achieve long-term success, and in turn add value to
shareholders.
In the past year, PROTON spared no effort to sustain the quest to embed the culture
of quality excellence throughout the organisation and business value chain. The strategic
focus has always been to enforce quality improvements in all areas; entrench quality
excellence into the processes of design, supply, manufacturing and marketing; as well as to
increase the overall competency level of quality management.
Quality Improvements
During the year under review, the Group re-ignited Translating the slogan into action, a quality
the rally-call for quality excellence, which was improvement framework was developed with a
encapsulated in the slogan “PROTON stays committed view to ensure that all quality concerns were
to quality improvements”. The campaign involved communicated to the relevant levels within the
a comprehensive evaluation and subsequent organisation. In addition, the framework also put in
implementation of initiatives that were aimed at place a proper gate-keeping process to make certain
enhancing quality excellence throughout the entire that quality concerns are solved in a correct and
process chain of the Group. Ultimately, the goal is timely manner.
to push the PROTON brand forward as a world-class
manufacturer.
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Operations Review
On the same score, the Quality Improvement Circle In addition to problem-solving, the Group also
(QIC), which is a committee introduced in the 2008 encourages creative innovations that can enhance
financial year to manage and resolve quality issues quality excellence. Hence, we have continued to
Group-wide on a timely basis, was further augmented support the pre-existing Innovative and Creative
with sub-QIC teams during the last financial year to Circle (ICC) and Kaizen Suggestion Scheme, which
bolster efficiencies and effectiveness. are programmes tasked to undertake quality
improvement initiatives at our production facilities.
Stemming from QIC and sub-QIC, the Quality In the year under review, our plants in Shah Alam
Improvement Team (QIT) was formed at the and Tanjung Malim successfully completed a total
operational level to address specific quality concerns of 250 ICC projects, while a total of 18,000 process
impacting the Group’s processes. At the end of the improvements were made under the Kaizen
2009 financial year, we registered a total of 136 QITs Suggestion Scheme, marking a more than 70%
that were involved in the successful resolution of expansion in projects carried out for both these
more than 70 quality concerns. programmes.
Achieving quality excellence continued

to be a top priority for the Group.
Quality in Design & Development

When it comes to delivering quality products, leading automakers all over the world
embrace the philosophy of ‘getting it right the first time’.
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Operations Review
At PROTON, we clearly understand the importance of building in the elements of quality

from the earliest stage of our processes: during the design and development stage. This
philosophy was incorporated in a comprehensive and tangible manner in the development
of PROTON’s very first multi-purpose vehicle (MPV), the Exora.
In order to build quality into the various stages of the Exora, PROTON installed a structured
quality planning system and carried out systematic quality assurance initiatives throughout
each stage of the creation process of the model. Some of these initiatives included stricter
New Product Introduction (NPI) gateway control, structured supplier Advance Product
Quality Planning (APQP) and consolidated Quality Residence Engineer (QRE) activities,
which were all aimed to make the Exora the highest quality PROTON vehicle to date.
Clearly, based on the latest customer feedback and response to date for the Exora, our
diligent efforts and investments are paying off handsomely.
Quality in Supply
The PROTON Group’s supply chain represents one All in all, 10 of our suppliers who have been working
of the most important elements in ensuring quality closely with our QITs in the past year recorded an
excellence. We cannot afford any weakened links impressive 20% improvement in terms of overall
that may negatively impact our brand. quality standards, which will in turn benefit the
overall production chain, the customer, and
During the financial year, we continued to be ultimately PROTON’s business.
highly stringent in our surveillance and monitoring
processes to ensure that the components we
received from our suppliers met our requirements.
Technical indicators such as incoming quality checks,
as well as the number of warranty claims and audit
ratings provided us with clear indications on the
performance of our suppliers. For those who fail
to meet our specifications, they are made to work
closely with our QITs to improve.
Quality inspection of the Exora in progress.

Operations Review
PROTON’s manufacturing process saw the introduction of the ‘Zero Defect Initiative’ to raise quality levels.
Quality in Manufacturing
During the year under review, the Company implemented a bold, yet crucial quality
excellence initiative into our product manufacturing process. Aptly called the Zero Defect
Initiative, this programme aims to ultimately manufacture cars with zero defect by making
certain that quality is consistently on our mind, while simultaneously driving home the
problem-solving culture Group-wide.
The Zero Defect Initiative includes the setting up of PROTON’s Quality View Center, which
is a platform to track results and achievements of this Initiative; daily meetings to discuss
quality measures and solve minor concerns; as well as the organising of talks to effectively
communicate the importance of doing work right first time, every time to all employees.
Since the implementation of the Zero Defect Initiative, PROTON significantly improved the
number of defects per unit and the direct pass rate by more than 50% todate.
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Operations Review
Quality excellence touches all aspects of PROTON’s business, including customer

experience.
Quality in the Market

Quality excellence does not end with the passing of keys to our customers. It is important
for PROTON to ensure that when our customers come into contact with the brand, may it
be test driving our cars for the very first time or an after-sales interaction, their experience
is a positive one.
The Group’s unrelenting goal to fortify quality customer service continues to bear results
given that our brand recorded an improvement in JD Power’s Customer Satisfaction Index
for 2008. Internally, the Group also recorded a 3% improvement in terms of satisfied
customers and a reduction of 2% for less satisfied customers.
While the trend is positive and we have progressed, there still remain gaps to be narrowed
or closed in our journey to attain world-class standards of quality. Changing perceptions of
quality is a long-term process, and as such PROTON will remain committed to engaging our
customers and catering effectively to their needs by continuously strengthening our quality
standards in all areas in the coming years.

Operations Review
Sales & Distribution

Domestic Market
In 2008, primarily as a result of heightened sales activity by the

industry players on the back of a strong economic growth of 5%
and positive consumer sentiment during the first three quarters of
the year, Total Industry Volume (TIV) surpassed the 500,000 mark to
hit 548,115 units. The half a million mark had only been breached
once before in previous years (2005). Volatile fuel prices and the
weakening domestic economic climate, however, had negatively
impacted the fourth quarter of the year and we expect the full
impact of the on-going global financial downturn to further impact
auto industries worldwide in 2009.
Performance
In response to the daunting economic conditions, the Malaysian Government had introduced
a scrapping scheme as part of the RM60 billion stimulus package to support the automotive
industry and boost domestic consumer spending. This scheme essentially enables owners
to trade in cars manufactured more than 10 years ago for a RM5,000 discount to purchase
a new national car. Since the introduction of this scheme, also known as PROTON Xchange
Program, we have received an average of 1,500 submissions as compared to 300 submissions
per month. At the close of the financial year, PROTON had cumulatively issued 4,500
redemption vouchers.
The Group also remained cognisant of our philosophy of introducing ‘the right car, for the
right market, at the right price and at the right time’. In line with this, the Group launched
several new economical models to meet the discerning needs of the Malaysian market.
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Operations Review
One significant milestone for both PROTON and the industry was the launch of Malaysia’s
first home-grown MPV, the Exora. With its excellent product features, the Exora has
garnered a highly favourable response from customers with bookings having reached
14,400 units as of end June 2009.
Todate, the revamped Saga remains the Company’s best-seller, as evidenced by bookings of
more than 120,000 units since its launch in January 2008. The introductions of the refreshed
Satria Neo, now sportier and with a CamPro CPS engine to boost, and the Persona SE, which
has a more elegant and distinctive design, were also well-received among the niche market
segments.
As part of the plans to strategically right-size and re-map the dealer network to solidify
our position in the market, we are on course with the rationalisation of PROTON Edar
Sdn Bhd and the Edaran Otomobil Nasional Berhad (EON) sales and distribution network.
The primary objective of this programme is to position PROTON as the sole brand with
a stronger and unified distribution network as well as marketing arm. Additionally, we
aim to leverage on best practices from both entities while carrying out focused, cohesive
marketing initiatives across networks.
The year also saw PROTON being bestowed with several awards. The Saga received three
awards: Winner in Small Sedan Category (Autocar Award 2008); Entry Level Car of the Year
2008 (NST/Maybank); and Best People’s Car (Asian Auto – VCA Auto Industry Awards 2008).
The Persona too, received the Best Model of the Year 2008 award from Frost & Sullivan.
The Delivery Centre at PROTON’s Centre of Excellence. The first truly Malaysian MPV takes centre-stage.
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Operations Review
Prospects
Undoubtedly the economy will continue to remain challenging in the next financial year.
However, PROTON is optimistic and prepared with numerous comprehensive marketing
and sales plans which include introduction of soon-to-be-launched new variants for the
Saga and Exora in order to expand the market segment further as well as to meet the
increasingly high expectations of customers. We are also on course to streamline our
market positioning and offerings to the market with our sound after-sales service. This will
provide a more integrated approach to improving business volume in the after-sales and
auto parts segments.
With this in mind, PROTON will continue with efforts in emphasising quality, attractive
products and focused marketing strategies to win the hearts of Malaysian car buyers.
Export Markets
Economic challenges ravaged automotive industries worldwide and PROTON did not escape
unscathed. Intense competition coupled with the credit crunch faced by our subsidiaries
and distributors particularly in the Australian and United Kingdom markets as well as an
escalation in fuel prices were among the key factors that contributed to the weakened
export environment.
In order to survive this turbulent period, car companies across Asia, Europe and North
America were forced to implement more creative marketing strategies to increase
consumers’ appetite.
Despite these challenges, which we will continue to overcome in the new financial year,
PROTON remained true to the core goal of fortifying our international presence in various
export markets by being steadfast in our commitment to further enhance the Group’s
operational efficiencies as well as quality of our products and services.

Operations Review
Performance and Operations

The year under review saw PROTON strengthening the Export Division with the
appointment of a new Director of Export whose primary responsibility is to enhance
sales and brand performance in overseas markets. The role also includes overseeing the
development of international subsidiaries, distributors and dealers which is aligned with
the Group’s Asian Multi-Local OEM (AMLO) marketing strategy.
Additionally, in terms of market expansion, we took steps to increase PROTON’s visibility

in Egypt, Syria and Thailand. The Group also made rapid progress with business operations
in China, where three plants commenced the assembly operations for the Gen.2 and
Persona models. This is expected to contribute positively towards our volume growth for
the next financial year.
PROTON also took the opportunity to launch new models in select markets: Persona and
Saga in Indonesia, Persona CNG in Thailand, and Persona left-hand-drive in the Middle East
and Gulf countries.
The Persona and Saga are set to make waves abroad.
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Operations Review
5-Year Export Volume and 2009/10 Forecast
25,000
20,925
20,595
18,428
20,000
17,337
17,243
15,000
12,526
10,000
5,000
0
2004/05 2005/06 2006/07 2007/08 2008/09 2009/10
Forecast
Prospects
PROTON is deeply committed towards moving beyond the local market by also building a
strong presence in other parts of Asia in the new financial year, with a key focus being the
company’s first-ever MPV, Exora, which is expected to stimulate as much interest in regional
markets as it has locally given its competitive pricing and value-for-money proposition.
Indonesia, where 60% of car consumers fall into the MPV segment, and Thailand, have
been earmarked as the first two countries for the export of the Exora targeted for July
2009.
Moving forward, the Group will also focus on high-growth regional markets in ASEAN for
the completely-built-up (CBU) market, as well as China, India and Iran for the completely-
knocked-down (CKD) market. Additionally, we plan to leverage on the existing trade and
cultural linkages to make further in-roads into other Middle-Eastern countries such as Egypt
and Syria for the CBU market, and to penetrate into Eastern European countries.

Operations Review
Asia
China

China is poised to be a world leader in the automotive industry. In 2009 China’s total vehicle
sales is forecasted to surpass that of the United States of America due to relatively stable
economic growth and favourable government policies.
During the year under review, PROTON’s business arrangement with China-based Jinhua
Youngman Group saw us forming a strategic business collaboration which covered four
major areas. This included the export of completely-built-up (CBU) Gen.2 and Persona for
sale through Youngman’s network in China, with the first batch of CBU being delivered in
early 2008. The collaboration also entails the supply of completely-knocked-down (CKD)
Gen.2 and Persona which commenced in April 2009.
In addition, PROTON can take advantage of China’s economies of scale and possible vendor
collaboration by localising components and engines. The business arrangement also
comprises technology transfer and technical support whereby PROTON provides technical
support for China’s localisation programme and manufacturing start-up.
Currently, PROTON cars are being sold through 80 appointed dealers throughout China
under the Europestar brand.
Prospects
Moving forward, PROTON plans to set up a
representative office in China in the second half of
2009.
Youngman plans to operate four plants in China,

namely at Anshun, Jinan, Tai An and Hangzhou. In
Hangzhou, there will be an engine plant for the
production of CamPro engines, to be operational in
October 2010.
PROTON’s operations begin in China.
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Operations Review
Indonesia

The Indonesian automotive market, like several others in the region, faced a highly volatile
economic climate due to the hike in fuel prices and interest rates, while escalating non-
performing loans and high risk of defaults caused financial institutions to be more cautious
in approving loans.
The year under review saw the launch of the Gen.2, Persona and Saga in the Indonesian
market. These new product offerings combined with the opening of additional sales outlets
resulted in PT Proton Edar Indonesia registering an increase in retail sales by 49%.
However, sales of PROTON taxis dipped by 57% as finance companies became more
stringent in approving loan applications from taxi operators. Nonetheless, PROTON
maintained the top 3 position in total taxi sales.
There were also significant corporate developments for PROTON in the fiscal year. For one,
PROTON secured a competitive financing affiliate from BCA Finance for its retail sales.
Additionally, changes in the automotive policy which resulted in a lower CKD import duty
for MFN (Most Favourable Nation) countries lowered competitors’ costs. As a result of the
reduction in CKD import duty to a flat 15%, the import duty gap was narrowed between
PROTON and auto competitors that enjoy an AFTA CEPT rate of 5%.
PROTON has also strengthened its presence in Indonesia by appointing senior officers to
helm the Company.
Prospects
The year ahead is expected to be a difficult one due to on-going economic challenges and
recent price hikes by car brands. Despite these conditions, the Company will continue to
strengthen the sales network, while maintaining operational efficiency.

Operations Review
Iran

PROTON’s presence in Iran began in 2001 with the appointment of Zagross Khodro (ZK)
first as a distributor and subsequently, assembler of PROTON vehicles in the country. ZK
started with the CBU import initially and seeing its potential, invested extensively in the
sales and after-sales network throughout the country.
Due to the company’s strong commitment and trust in the PROTON brand, ZK took a bold
step by establishing a CKD assembly plant in the Borujerd province, approximately 400km
south of Tehran, with production capacity up to 25,000 units a year.
The plant started with the assembly of the Wira in 2002 and thereafter began producing the
Gen.2 in May 2009. The targeted volume for the Gen.2 production will be approximately
3,000 units in the new financial year and we expect this to double in fiscal year 2011.
In addition to the partnership with ZK, PROTON also entered into a strategic collaboration
agreement with the SAIPA Group, one of the biggest automotive manufacturers in Iran.
The collaboration enables PROTON to explore opportunities in other areas such as research
and development.
Prospects
The new financial year will see PROTON’s market presence being further strengthened in
Iran with CKD operations to include the production of the Persona. With Total Industry
Volume (TIV) of more than 1.2 million vehicles annually, Iran has the potential to become
one of the major export markets for PROTON in the coming years.
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Operations Review
An agreement was signed with Zagross Khodro for the supply of automotive parts to assemble the Gen.2 in Iran.

Operations Review
Singapore

The slowdown in the global economy saw Singapore’s GDP contracting significantly to a
growth of 1.1% compared to 7.8% a year ago. The weaker than expected growth impacted
many sectors, especially retail.
Sales for PROTON Singapore in the year under review saw a decline of 29% as fewer
customers invested in big ticket items such as vehicles or property. This was primarily due
to the hike in fuel prices and tightening of credit. As a result of firmer credit control, 20%
of PROTON bookings were cancelled as customers could not obtain the necessary loans. In
addition, the Certificate of Entitlement quota which controls the total new car population
in Singapore was reduced by 11.9% from the previous year.
However, the launch of the Saga in July 2008 generated positive response from first-time
and price sensitive buyers.
Despite the challenging conditions faced, PROTON Singapore managed to record a modest
profit owing to the successful implementation of marketing strategies and aggressive
re-structuring and cost cutting measures.
Prospects
Moving forward, PROTON Singapore expects to
further intensify marketing efforts in 2010 as the
green shoots of a recovering economy begin
to emerge, while we continue to enhance cost
management.
The Saga landed in Singapore in mid 2008.
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Operations Review
Thailand

The global financial crisis saw Thailand’s automotive Given the growing appeal of the Persona CNG as a
TIV dropping by 2.5% in the year under review. Fear result of escalating fuel prices in Thailand, the model
of recession, a weakening Thai Baht against the US has turned out to be a viable alternative to the Savvy
Dollar, risk-averse financial institutions and a rise in to drive volume.
fuel prices, collectively impacted the industry here as
they did in many other parts of the world. PROTON subsequently launched the full Persona
range in November 2008 at the Thai Motor Expo 2008
In spite of this backdrop, PROTON registered sales to enthusiastic response. The Persona, which had also
of 3,279 units and achieved the No. 8 ranking in been hailed as one of the Top 10 most exciting new
Thailand’s Passenger Car Segment in the first year cars to enter the market in 2009 by the Bangkok Post,
of its entry into this market. was also well-received at the Bangkok Motorshow
in March 2009 and contributed to almost 49% of
Two products mainly drove sales: the Savvy and PROTON sales derived here.
Persona. Voted among Thailand’s Top 10 cars for
2008 by local publication, The Nation, the Savvy By the end of the financial year, Proton Motors
currently dominates the small car segment here (Thailand) Co Ltd had successfully started its operations
but price competition could erode profitability. in March 2009 with importation of PROTON cars into
Thailand for wholesale to the distributor, Phranakorn
The Savvy’s success was followed by the launch Auto Sales Co Ltd, who had also established a network
of the eco-friendly Persona CNG in October 2008. of 30 showrooms across Thailand during this period.
Prospects
In the coming year, while economic challenges will still prevail, PROTON is cautiously
optimistic about strengthening our presence in Thailand especially in the small car segment,
while enhancing our operational efficiency.

Operations Review
Australia
Overview
On the back of record sales in 2007, the Australian
automotive industry was on track for another record
year in early 2008 with a 3.5% increase in sales in
June. However, the effects of the global crisis resulted
in an overall decline of 3.7% in sales for the year
under review, with the slowdown most evident in the
last three months of 2008. This was compounded by
the withdrawal of two leading finance providers who
were previously responsible for over 50% of retail
automotive financing. PROTON sponsors the Wests Tigers Rugby team in Australia.

During the year, Proton Cars Australia embarked accolades received by the Jumbuck was Australia’s
on an ambitious campaign to rationalise the dealer Greenest Utility Vehicle due to its low emissions. It
network in preparation for the launch of the new was also awarded the lowest cost vehicle to own
Saga. While this campaign resulted in lower sales and run, in its class, by the National Road Motorists
for the year, the operational aspects of the business Association.
were reviewed in preparation for the introduction of
a long-term volume growth strategy. PROTON in Australia also continued our association
with ‘Safe Drive Training’, an organisation responsible
The challenging trading environment combined for training over 5,000 school age drivers from 113
with the lack of readily-available vehicle financing schools across New South Wales and Queensland
compounded the effects of the dealer rationalisation annually.
programme. Sales fell by 20% compared with the
16% increase in the previous year. With reductions Furthermore, we continued with our sponsorship of
made in marketing expenditure and overall cost the Wests Tigers Rugby League Football team. An
containment, we managed to lessen the effect on the estimated 400,000 people attended the Wests Tigers
bottom line. matches during the season with an additional 14.2
million watching them on television which gave
The Jumbuck continued to be the highest selling PROTON an opportunity to maintain a visible brand
model, followed by Savvy and Persona. Among the presence.
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Operations Review
The Persona is launched Down Under.
Prospects
The year ahead is expected to be the most prosperous since the introduction of the brand
in Australia. This is despite the 2009 forecast of a decline in overall industry volume which
has been set lower again with estimates indicating a drop of up to 10%.
Proton Cars Australia will be rolling out an ambitious volume growth plan which includes
expansion of the current dealer network from 25 to 51 dealers nationally. The enhanced
exposure coupled with an increase in marketing efforts and product diversity is expected
to boost rapid growth.
This will result in both an increase in sales as well as profitability, thereby putting in place
the foundation for years of profitable growth moving forward.

Operations Review
United Kingdom
Overview
The overall UK new car market total industry volume (TIV) decreased by over 11% in 2008
compared with a year ago. The last quarter saw an even sharper decline in sales of over
27% with total sales decreasing from 2.404 million units in 2007 to 2.132 million units in
2008.
While the fleet and business sales sectors generally fared better, the private buyer sector
was the worst hit with a 15% sales dip in the year.
‘Green cars’, however, continued to see a rise in demand. There was an increase in sales of
diesel engine vehicles, particularly the 1.6 size diesel engines which saw a 26% increase,
and petrol engines producing low levels of CO2. This was due primarily to high fuel prices
and new car tax based on CO2 levels. Sales of petrol vehicles reduced by 17%.
Demand for all body types and segments was reduced with the exception of Superminis
which saw significant increase in sales as consumers looked for more economical but well-
equipped and roomy vehicles. The successful introduction of new replacement models by
the two market leaders further strengthened their stronghold.

Challenging economic conditions saw PROTON sales decrease significantly by 38% during
the year under review. Despite the circumstances, Proton Cars (UK) Ltd achieved several
operational goals which helped offset the downturn.
A number of initiatives were introduced to improve operational performance and cost base.
These included a company-wide resource re-organisation, a cost reduction programme,
the amalgamation of all departments into one cost efficient central office, the setting
up of a new in-house vehicle storage and preparation centre, centralised training, new
dealer support systems and improved IT operations. The new in-house storage and PDI
(pre delivery inspection) centre in particular saved cost while reducing delivery speed and
improving quality.
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Operations Review
Prospects
The year 2009 is expected to be a difficult one for the automotive industry with little
improvement in the UK forecast before next year. Competition will continue to increase as
manufacturers strive to gain volume share and offset falling demand.
Against this backdrop, Proton Cars (UK) Ltd is adopting prudent measures to counter the
effects of market conditions, currency devaluation and the public’s lack of confidence
and credit availability to buy new cars. These measures are expected to provide on-going
cost savings whilst ensuring targets are met and class leading service levels continue to be
maintained.
The Gen.2 in the UK.

Operations Review
Properties
The year under review saw PROTON focusing on the disposal
of non-core assets, which were mostly residential units
and a few parcels of vacant land held by wholly-owned
subsidiaries.
PROTON Group’s main manufacturing-based assets are located in Shah Alam and Glenmarie
in Selangor, and Tanjung Malim in Perak. Other assets comprise our primary administrative
building known as the Centre of Excellence in Subang Jaya as well as the numerous 3S
centres nationwide.
In recognition of the PROTON Sports Complex being one of Tanjung Malim’s most well-
equipped sports facilities, it was selected by the Football Association of Malaysia as the
home stadium for Proton FC for its President’s Cup League 2008. It is our intention to carry
on improving and upgrading these facilities in order to become Southern Perak’s leading
hub for sports and social activities.
Additionally, Proton City Development Corporation Sdn Bhd, a 40% owned associate
company, continued to enhance visibility for Proton City in Tanjung Malim. Proton City
was planned with modern infrastructures, recreational park and rich landscaping which
have all contributed towards making it a viable investment option for buyers of residential
units in the area.
While the year ahead poses its challenges given the downturn in the economy, to ensure
the marketability of Proton City, we will focus on re-planning selected products to better
cater to discerning home buyers. The undeveloped land bank in Proton City remained at
2,720 acres at the end of the fiscal year.
114
Top: The Centre of Excellence in Subang Jaya.
Bottom: PROTON’s Sports Complex is one of Tanjung Malim’s best sports facilities.

Operations Review
Financial Services
Proton Commerce Sdn Bhd (PCSB) is a joint venture company
between Proton Edar Sdn Bhd and CIMB Bank Berhad, which
enables PROTON to provide quality financing services to our
customers.
PCSB offers competitive hire purchase loan financing

packages to new PROTON car purchasers through the PESB
and EON sales network nationwide.
Customers will not only enjoy better deals for car financing but also speedier application
and approval processes as well as value-added packages that offer a combination of other
financial products.
Backed by the expertise and reliability of two established parent companies, the PROTON
Group is committed to delivering competitive hire purchase packages that prioritises
providing fast, efficient and friendly service to our car buyers. By doing this, it is our aim
to become the preferred automotive finance provider for the purchase of new PROTON
vehicles, while being recognised as a competitive and capable player in the local automotive
financing industry.
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Operations Review
Corporate Social Responsibility

PROTON is fully aware that the attention to a company’s
profitability must correspond to a similar focus on human
resource development and the environment it operates in.
With this in mind, the Group is committed to making positive strides and worthwhile
contributions towards creating a sustainable business that benefits our people and society
at large.
In carrying out our corporate social responsibility (CSR) initiatives, the Group aims to
achieve several broad objectives which will meet the expectations of good corporate
governance, ethical corporate values and responsible corporate citizenry. It is also vital
that we advocate a corporate culture that appreciates the value of social service and how
it impacts stakeholders as a whole.
At PROTON, we divide our CSR initiatives into four main segments: marketplace, workplace,
community and environment.
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PROTON Malaysia Open 2009, an annual event anticipated by badminton fans worldwide.

Operations Review
PROTON i-CARE plays a key part in enhancing value for our customers.
Marketplace
CSR initiatives in this area are essentially related to the Group’s objective of maintaining
sound business practices at all times, be it with the shareholder, customer or supplier. We
take utmost care to ensure that all businesses are not only conducted in an ethical and
professional manner, but are also in compliance with regulatory requirements.
Maintaining customer satisfaction is one of the foremost pillars of PROTON’s business

management and much effort is taken to cultivate strong relationships with our customers
in order to improve their satisfaction levels. A primary tool to enhance customer satisfaction
is our customer survey which is specifically tailored to PROTON’s business operations. The
valuable information gleaned is analysed and then incorporated into product and service
developments, sales as well as customer care activities so we can ensure that the customers’
experience with PROTON is constantly being enhanced.
The year saw the Group continuing to elevate the standards of PROTON i-CARE by
emphasising the importance of creating the best value for our customers. From the
moment the customers make a call to the Call Centre, they should have a smooth, seamless
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Operations Review
experience and this includes receiving free technical advice and assistance at our highly
competent technical centres.
PROTON employees are also encouraged to evaluate this process periodically in order to
better understand a customer’s needs and thereby improve the quality and speed of our
response to customers.
If a product experiences a malfunction, the Company acts promptly to minimise adverse

effects to customers and mobilises all divisions affected to provide a rapid response. In
critical cases, particularly where customer safety is involved, we assess the scope of damages
and thoroughly investigate the cause of the incident.
In accordance with best practises of major OEMs, PROTON would recall a product that has
possible defects. As part of corporate responsibility and good governance, PROTON makes
public announcements either through newspaper advertisements or the website to ensure
customers are immediately informed.
Additionally, PROTON strives to build sound partnerships with our suppliers through
fair trading in compliance with procurement-related policies, laws and regulations. We
continuously monitor the performance of suppliers with on-going quality audits and
where necessary, request for improvements and provide guidance. For new procurement
transactions, we not only ensure that goods and services procured conform to the Group’s
policies but also take into consideration the suppliers’ manufacturing sites, management
systems and the state of their operations. Suppliers’ efficiency and productivity are also
supported through the Improve, Control and Educate (ICE) initiative whereby sustainability
of supply capacity and training are greatly emphasised. PROTON closely monitors the
progress through extensive reviews and follow-up visits.
For small and medium sized suppliers, PROTON provides technical support that enables
them to have access to the Automotive Development Fund which was established by the
Government to ease financial difficulties resulting from the current economic crisis. To
date, approximately RM35 million has been disbursed.

Operations Review
Workplace
At PROTON, we recognise that a talented, productive human capital represents the
backbone of our development and progress.
Our workplace CSR does not only provide our employees with optimum working conditions,
as evidenced by the Group’s safety and health policies, training exercises and other benefits
to safeguard each one’s welfare. We also ensure that their skills and talents are nurtured.
By harnessing this cohesively, we can further enhance PROTON’s competitive advantage in
the industry.
As important as it is to grow as one seamless entity, we must also develop and retain
qualified leaders. Through the Group’s management initiatives, we develop key members
of our workforce by using PROTON’s Core and Leadership Competency Model. A similar
approach is applied for those who are keen to advance along the technical career track
via the Technical & Functional Competency Model. By using these competency models, our
Talent Management Programme has enhanced PROTON’s ability to identify, develop, and
retain critical skills and talents, especially for positions that play a critical role in delivering
business and strategic growth.
Maintaining open communications between employees and Management is also vital.

PROTON has implemented a range of initiatives specifically designed to encourage such
communication so employees can achieve their full potential and progress within the
company. Initiatives include disclosing key performance indices, shared assessments,
personnel system reforms and streamlining the scheme of service throughout the Group.
To further strengthen PROTON’s learning capability, we implemented the PROTON

Development Framework which includes the Centre of Manufacturing Excellence, Centre of
Knowledge Excellence, and Centre of Human Capital Excellence. In essence, this initiative
promotes a strong knowledge culture by encouraging continuous learning through various
training programmes.
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Operations Review
PROTON conducts numerous training

programmes for staff in different
divisions.
In 2008 PROTON trained a total of 6,348 staff comprising executives and non-executives.
The Group also kicked off a 5-year Competency Based In-house Trainers Development
Programme to help drive knowledge-building initiatives. These initiatives were further
strengthened by collaborating with established training and higher learning institutions.
A Memorandum of Understanding was signed between GIAT MARA Malaysia in June 2008
to collaborate on Work Based Learning (WBL) for students from the institute. The first
batch of 155 students completed their 4-month WBL at the Tanjung Malim plant, following
which, 50 trainees were offered full-time employment with PROTON. PROTON is also
collaborating with community colleges to provide WBL for specialised & technical work
such as maintenance & machining in the manufacturing plants.

Operations Review
To facilitate the development of non-executive employees, PROTON is also in discussions

with BATC to develop an Executive Diploma in Manufacturing Systems Engineering. The
first intake is expected to take place by September 2009.
PROTON has also embarked on a major initiative of institutionalising Knowledge

Management (KM) practices which is key to our on-going growth and building a knowledge-
based human capital. In support of this initiative, we launched our first KM portal ASPIRE
(Advanced Strategic Proton Information Repository Engine) in April 2009. We are optimistic
that with the presence of good equipment, techniques and practices, PROTON can ‘ASPIRE’
to be a leading player in the automotive industry both domestically and in the region.
After years of prioritising health and safety, PROTON has accumulated a wealth of
knowledge and experience in health and safety management, education, maintenance, and
the environment. As such, a wide range of occupational health and safety measures have
been implemented throughout the Group’s premises and related businesses nationwide.
To further complement this, the Group organised numerous health talks, carnivals,
exhibitions and programmes throughout the year to create awareness amongst employees
on the importance of adopting safe and healthy lifestyles. Steering and working committees
were established to allow for more effective monitoring of health and safety related issues
throughout the PROTON Group of companies.
Community
Community CSR is another important segment for the Group and encompasses philanthropic
activities and donations mainly revolving around local communities, youth programmes,
NGOs and various other special interest groups.
On an annual basis, PROTON disburses approximately RM200,000 in the form of scholarships

to deserving students so they can pursue their higher education ambitions at recognised
local institutions of higher learning.
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Operations Review
Additionally, Yayasan PROTON carried out several educational initiatives during the year. In
November 2008, 16 scholars from universities around the country received scholarships from
the Group at a ceremony, which also witnessed representatives from Yayasan PROTON’s
‘Adopted School Programme’ being presented with mock cheques. These ‘adopted’
schools, located in Shah Alam and Tanjung Malim, require financial support for educational
activities such as PMR and SPM tuition classes and motivational seminars, among others.
Yayasan PROTON awards students with scholarships to pursue their higher education.
During the year under review, Yayasan PROTON through its ‘Adopted School Programme’
contributed funds in support of educational activities for four schools: Sekolah Menengah
Kebangsaan Agama Slim River, Sekolah Menengah Teknik Shah Alam, Sekolah Menengah
Kebangsaan Dato’ Khir Johari and Sekolah Kebangsaan Behrang.

Operations Review
A badminton clinic for ‘Pintar Programme’ school children in Penang being conducted by national coach
and ex-national player Tuan Haji Misbun Sidek.
Yayasan PROTON scholars also participated in the Group’s annual team-building activity in
February 2009 at Kelana Resort, Seremban, where scholars were exposed to the company’s
core values and took part in outdoor activities aimed to develop team spirit and build
confidence.
In the same month, RM40,000 was contributed by Yayasan PROTON towards PROTON’s
Tabung Pendidikan, while the Majlis Anugerah Kecemerlangan Akademik PMR and SPM
was held to reward children of staff who had achieved excellent results.
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Operations Review
As part of our commitment to nation-building, we aim to enhance national unity amongst

Malaysians and promote economic development. A major initiative under this platform
is PROTON’s involvement in the ‘Pintar Programme’ which is spearheaded by Khazanah
Nasional Berhad and involves other Government-Linked Companies. Our main objective
is to assist children from low-income families improve their academic performance and
develop positive characteristics while young. The ‘adoption’, which involves a commitment
of RM0.5 million, is for three years and began in the 2007/2008 financial year, with
structured activities to be implemented throughout the duration.
In the year under review PROTON’s ‘Pintar Programme’ adopted four schools with a total
number of 3,006 students. Collectively, 36 activities were held including motivational
programmes, weekly tuition classes, coaching for exam year students, English classes as
well as recreational activities such as football and badminton clinics in collaboration with
the Badminton Association of Malaysia (BAM) and PROTON Football Club. PROTON also
provided necessities such as water coolers and library books as well as incentives to the
poorer and high achieving students in the form of cash and bicycles.
The four schools are Sekolah Rendah Kebangsaan Bagan Tuan Kechil in Butterworth, Penang;
Sekolah Menengah Paya Keladi in Kepala Batas, Penang; Sekolah Rendah Kebangsaan,
Tanjung Malim, Perak; and Sekolah Rendah Kebangsaan Pintu Gang, Paloh, Kelantan.
In sports, PROTON continued to build talent at the grassroot level through development
programmes particularly for badminton and football enthusiasts. Going beyond this
objective, our initiatives under this platform also serve to promote Malaysia as a preferred
destination for sports tourism.
We continued our role as the major sponsor of badminton through BAM, with an allocation
of RM3.5 million (including promotions) for the sport during the year under review. The
year 2008 was a successful one for BAM as its players performed well in various international
outings particularly in the Beijing 2008 Olympics where top national player Lee Chong Wei
bagged the country’s only medal in the games.

Operations Review
A convoy of PROTON sponsored vehicles at the Le Tour de Langkawi.
The year also saw PROTON’s football team qualifying for the Liga Perdana in the National
Football League, while we once again sponsored the country’s A1 team to promote the
growth of the motorsports industry in the country as well as the PROTON brand in the
international arena.
The Le Tour de Langkawi international cycling event, which PROTON has long been
associated with, also continued to receive sponsorship and organisational assistance. The
event has not only helped place the nation on the world map, but more importantly, it has
spurred the development of homegrown cycling talents to compete at international level.
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Operations Review
Under Bridging Community Programme, PROTON lends its hand to the less fortunate
members of society by building and repairing homes. The year saw PROTON carrying out
various repair works for Rumah Anak Yatim Siraman Kasih in Rawang and Rumah Anak
Yatim Sekendi in Sabak Bernam. PROTON also built a hostel for 60 inmates at Rumah Anak-
Anak Yatim & Miskin Darul Aitam, Tepoh, Perak.
In addition, PROTON annually supports various national bodies and organisations such
as MERCY, Yayasan Harapan Kanak-Kanak, Pediatric Ward of Hospital Tengku Ampuan
Rahimah, Yayasan Orang Kurang Upaya Kelantan, and PEMADAM with the sponsorship
of cars.
PROTON also has an on-going programme involving automotive technical education

through the contribution of used/scrap engines, components and body parts to national
technical institutions such as GIAT Mara, Institut Latihan Perindustrian under the Ministry
of Human Resources, Akademi Latihan Bomba and Institut Kejuruteraan Tentera Darat, as
well as various community colleges. PROTON has been the main sponsor for the Malaysian
Skills Competition (the automobile technology sector) organised by the Ministry of Works
for the past seven years. The annual Grant includes sending Malaysian representatives to
the ASEAN and World Competitions, with the objective of nurturing young local talents in
this sector and building world-class human capital.
PROTON’s football team is in the

National Football League.

Operations Review
Environment, Health & Safety Report

As Malaysia’s largest manufacturer of automobiles, PROTON
is committed towards protecting the environment by
conforming to the Environmental Quality Act, 1974, OSHA
(Occupational Safety and Health Administration) guidelines
as well as other rules and regulations as part of our corporate
responsibility.
PROTON’s Environmental, Health and Safety Policy together with Quality Policy ensures that
the Group is conscientious about its operations impact on the surroundings and protecting
the health and safety of PROTON’s greatest assets, its people, and the community at
large.
ISO14001 Environment Management System

Reducing the carbon footprint as part of PROTON’s environmental initiatives continued to
be a core focus for the Group. In 2007, we had embarked on an ambitious journey in order
to achieve international standards in managing our environment. During the year under
review, PROTON passed the pre-assessment audit on ISO14001 Environmental Management
System carried out jointly by Vehicle Certification Agency (VCA) and SIRIM Malaysia, and
accredited by the United Kingdom Accreditation Service (UKAS).
Considered a means to building greater trust in the marketplace, this internationally

recognised evaluation gives the assurance that PROTON is systematically managing the
environment by benchmarking itself against international standards. Strong customer
confidence in PROTON’s products and services is a must; as such we take pride in these
certifications as they do create a favourable impression especially on export markets such
as the UK and Australia, where environmental concerns are of paramount importance.
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Operations Review
Amongst PROTON’s environmentally-friendly measures at all its plants include the

installation of ‘green’ equipment, machinery, robots and automation systems. As these
utilise less energy and emit less waste into the atmosphere, such installations have
contributed towards improving efficiency levels at PROTON.
Waste Water Recycling

PROTON utilises water resources in a responsible manner. Wastewater from the domestic and
industrial sources are chemically and biologically treated within PROTON’s manufacturing
facilities.
Currently, the recycled wastewater is used as incinerator coolant at the rate of 25,000 litres
per hour to cool down and maintain proper operating temperature. The recycled water is
also used to water plants, as well as clean roads and drains within PROTON’s facilities.
Toxic Waste Treatment

During the year, PROTON’s industrial wastewater effluence discharged after treatment was
well below the legal limit under the Environmental Quality Act, 1974:
• COD – Chemical Oxygen Demand’s standard is 100 mg/l; PROTON’s actual discharge
was less than 50 mg/l.
• BOD – Biological Oxygen Demand’s standard is 50 mg/l; PROTON’s actual discharge
was less than 10 mg/l.
Scheduled waste is defined as any toxic waste falling within the categories of waste listed
in the First Schedule, Environment Quality (Scheduled Waste) Regulations, 2005. While
PROTON manages the treating of scheduled waste within the plant premises, the final dry
sludge from the scheduled waste is transferred to Kulaiti Alam Sdn Bhd, the sole national
schedule waste management centre located in Negeri Sembilan.
During the manufacturing process, several types of scheduled wastes are generated. These
are mainly the result of the overspray dust that occurs during the painting process and
are known as paint sludge, which is treated by an incineration process that requires a
temperature of more than 1,000 Celsius.
PROTON’s volume of scheduled waste generated as a by-product from the manufacturing

process during the year was once again on a downward trend in keeping with previous
years.
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Operations Review
End of Life Vehicles

The quality of the cars manufactured can also impact the environment. In view of this,
PROTON continues to ensure that all automobiles produced by the Group for the UK
and European markets comply with the End of Life Vehicle (ELV) directive issued by the
European Union. By maintaining exacting standards in our product line, we have taken
further steps to ensure PROTON vehicles do not cause harm to the environment and people
upon their end of life disposal.
PROTON X-Change Programme

In a bid to remove old cars from Malaysian roads and curb pollution, PROTON had in the
previous year embarked on the X-Change Programme where cars that were more than 10
years old can be exchanged for a rebate of RM5,000 to be used towards the down-payment
of a brand new PROTON car. Cars that are traded in are usually used as scrap metal.
The programme, which is a part of the Government’s second stimulus package, will come
to an end in December 2009. Owners of aging cars with low resale value have been taking
advantage of this programme that has already seen close to 11,900 rebate vouchers being
issued by PROTON as of July 2009.

Operations Review
Green Cars
Growing concerns with protecting the environment, managing carbon footprint, as well as
volatile petrol prices, have resulted in an increasing interest in ‘green’ vehicles worldwide.
During the year under review, PROTON’s vision of creating an automobile that is powered
by natural gas became a reality with the Saga NGV (natural gas vehicle). PROTON is currently
also focusing its R&D efforts on another alternative fuel vehicle, the electric vehicle.
Health and Safety

Management Commitment
With the formalisation of the Environment, Health and Safety policy, the Group ensured
that its implementation was supported with adequate manpower and funds. As a result
of top-down commitment, the Company was able to sustain employees’ interest in various
programmes which helped to reduce, and in some cases eliminate, occupational injuries
and illnesses.
Numerous Occupational Safety and Health (OSH) programmes and activities were developed
to ensure the safety, health & welfare of persons at the workplace and to protect external
parties against possible hazards.
A key activity is PROTON’s ergonomics improvement programme which aims to maintain

human-friendly working conditions and reduce work load at the assembly line. Ergonomics
covers all aspects of the job from the physical stress it places on joints, muscles, nerves,
tendons, bones and the like, to environmental factors which can affect hearing, vision and
general health.
Through this programme, PROTON had during the year abolished the following:
• The practise of carrying heavy items that are more than 10 kg in weight such as
window glass, seats, instrument panels, exhaust pipes and tires.
• Heavy physical work such as high torque wrench corresponding to more than 10 kg-m
for the tightening of suspension, tire bolts and drive shafts.
• Untidy work and other dislikes by operators such as urethane application and fluid
charging.
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Operations Review
Instilling sound commuting practices that revolve around safety at all times is an on-going
priority for PROTON. The following campaigns were carried out during the year:
• Road safety campaigns during festive seasons in collaboration with DOSH, Police,
NIOSH and other agencies.
• Defensive riding courses for employees by in-house skilled trainers.
• Motorcycle convoy skills to foster correct motorcycle riding, which included
programmes such as convoys to Teluk Batik and Ilham Resort, Port Dickson, with in-
house union members.
• Defensive driving training programmes for the public and customers to educate and
teach PROTON car owners safety and defensive driving techniques. This was in line
with the Government’s aim to make roads safer and bring down the alarming
number of road accidents and fatalities.
As a result of stringent safety practices on site, the number of industrial accidents recorded
in years 2006, 2007 and 2008 were 27, 18 and 11 respectively. The rate is consistent with the
downward trend in the past few years and PROTON will continue in its efforts in this area.
Staff who ride motorcycles to work receive helmets and reflective vests from the Managing Director.

Shouldering Responsibility
Shouldering
Responsibility
PROTON’s evolution as
a national automaker
lies in maintaining
integrity, transparency
and commitment to the
Company’s values as it
upholds the interests of
stakeholders.
Innovation in Motion
Statement on Corporate
Governance
The Board of PROTON is committed to applying the
recommendations of the Malaysian Code on Corporate
Governance (revised 2007) (“the Code”) and the principles
of Best Practices recommended in the Code to ensure that
good corporate governance is practised throughout the
Group to effectively discharge its responsibilities to protect
and enhance shareholder value.
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The Board is also committed to abiding by the Guidelines to Enhance Board Effectiveness
as set by the Putrajaya Committee on GLC High Performance (PCG), and at the same time,
striving to maintain a high level of corporate governance within the PROTON Group
by ensuring that the highest standards of corporate culture are practised throughout.
Good corporate governance is the foundation of the culture and business practices of
the PROTON Group.
Set out herein is a statement on how the Group has applied the principles and adopted
the best practices as laid down in the Code. This statement describes how the Principles of
Good Governance and provisions of the Code are applied by the Group.

Statement on Corporate Governance
Board of Directors
The Board is committed to establishing and enhancing shareholder value in the long-term
and is pleased to report that the Group has to its best efforts and knowledge complied with
the Principles and Best Practices of the Code throughout the financial year under review.
The Board continues to enhance its role in improving governance practices effectively
to safeguard the interests of the shareholders as well as stakeholders. To this end, the
Board has full control of and is responsible for the Group’s overall strategy, acquisition
and divestment policies, capital expenditures, annual budget, review of financial and
operational performance, and internal controls and risk management processes. The
Group’s overall strategic direction, development, implementation and control remain of
primary importance to the Board.
Dato’ Mohammed Bin Azlan Hashim resigned as Non-Executive Chairman of PROTON on

1 January 2009. Dato’ Mohd Nadzmi Bin Mohd Salleh who was previously the Managing
Director of Perusahaan Otomobil Nasional Berhad (the then listed entity on the Kuala
Lumpur Stock Exchange) from 29 June 1993 until 1 April 1996 was appointed as the new
Non-Executive Chairman of PROTON on 1 January 2009.
The roles and responsibilities of the Non-Executive Chairman and the Managing Director
are clearly defined. The Chairman ensures the integrity and effectiveness of the Board as a
whole. He conducts Board meetings and ensures that it proceeds in an orderly manner.
The Managing Director (“MD”) on the other hand is responsible for making, and ensures
the implementation of, broad policies as approved by the Board and reports to and
discusses material matters including regulatory developments and strategic projects with
the Board. There is therefore a natural separation of management and governance leading
to a balance of power and authority.
The non-executive directors are independent of management and are free from any business
relationship, which could materially interfere with the exercise of their independent
judgment.
The Board has delegated matters pertaining to the day to day management, operations and
strategic development of the Group subject to the Limits of Authorities and Group Policies
and Procedures to the Managing Director who is supported by a competent Management
Team.
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In the financial year ended 31 March 2009, the Board of PROTON Holdings Berhad (PHB) met nine (9) times
details of which are as shown below:
No Name of Director Designation Date of Date of Meeting Percentage

Appointment Resignation Attendance
1 Dato’ Mohd Nadzmi Non-Independent/ 1 January 2009 N/A 1/1 100%

Bin Mohd Salleh Non-Executive Chairman
2 Dato’ Haji Syed Zainal Managing Director 1 January 2006 N/A 8/9 89%
Abidin B Syed
Mohamed Tahir
3 Tuan Haji Abdul Jabbar Independent Non- 12 April 2004 N/A 8/9 89%
Bin Abdul Majid Executive Director
4 Tuan Haji Abdul Kadir Independent Non- 10 March 2005 N/A 9/9 100%
Bin Md Kassim Executive Director
5 Dato’ Michael Independent Non- 15 September 2006 N/A 8/9 89%

Lim Heen Peok Executive Director
6 Datuk Zalekha Binti Non-Independent 11 February 2008 N/A 6/9 67%

Hassan Non-Executive Director
7 Dato’ Mohammed Non-Independent/ 17 December 2004 1 January 2009 8/8 100%

Azlan Bin Hashim Non-Executive Chairman
Note: On 13 May 2009, Encik Oh Kim Sun was appointed Independent Non-Executive Director of PROTON.
The profiles of the directors are set out on (pages 28 to 35) of the Annual Report.
Board meetings for the Company and its subsidiaries are scheduled in advance before the start of each calendar
year and the meetings calendar is circulated to all Board Members at the beginning of each year. This would
enable the Directors to plan ahead and ensure attendance at Board Meetings. Additional meetings or Special
Board meetings are convened whenever necessary when there are urgent and important decisions to be
made.

Board Composition and Balance

The Board consists of seven (7) members with the Chairman being a Non-Independent Non-
Executive Director, one (1) Non-Independent Non-Executive Director, four (4) Independent
Non-Executive Directors and one (1) Executive Director who is the Managing Director.
Tuan Haji Abdul Jabbar Bin Abdul Majid and Tuan Haji Abdul Kadir Bin Md Kassim are the
Company’s Senior Independent Directors to whom concerns pertaining to the Group may
be conveyed by the shareholders and the public.
Apart for the Managing Director, all the Non-Executive Directors are independent of
management and free from any business or other relationship, which could materially
interfere with the exercise of independent judgment.
Independence and Conflict of Interest

The Directors are required to make written declarations and it is their responsibility to
declare whether they have a potential or actual conflict of interest in any transaction.
Where issues involve conflict of interest, the interested Directors abstain from discussing or
voting on the matter.
Supply of Information
The Board has full access to all information pertaining to the Group’s business affairs to
enable the Board to discharge its responsibilities effectively.
In general, the agenda, board papers and minutes of previous meetings of the Board
and Board Committees including minutes of board meetings of subsidiary companies are
circulated in advance to the Board before meetings. The agenda for every meeting permits
the Board members to review the contents of meetings and enables the Chairman to better
and more efficiently conduct the proceedings at the Board meetings.
The Board has full access to the Company Secretary who is available to provide the Directors
with the appropriate advice and services and also to ensure that the relevant procedures
are followed and rules and regulations are complied with. The Board is, from time to time,
updated, with any changes in the law, governance and other regulatory requirements.
Senior Management as well as professional and external advisors are from time to time
invited to attend board meetings to deliberate and clarify issues on the subject matter
concerned.
The Company has drawn up a list of transactions that would require the prior approval of
the Board. The same is reflected in PROTON’s Group Policy and Procedures and Limits of
Authority.
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Policy on Appointment of Directors

The Board Nomination & Remuneration Committee reviews all new appointments by taking
into consideration the skill sets required by the Company and the Group.
Board Members are appointed through a formal and transparent selection process that is
consistent with the Articles of Association of the Company and the Company’s Selection
Policy for Directors.
New directors are required to undergo familiarisation programmes, plant visits and briefings
to get a better understanding of the PROTON Group, its operations and the automotive
industry.
The Board Nomination & Remuneration Committee, apart from carrying out annual reviews
on the mix of skills and experience of the Directors to ensure that the Board has the right
balance and effectiveness also ensures an effective process of selection of all key posts within
the PROTON Group and this includes all members of the senior management committee
and similar level executives including direct reports to the respective chief executive officer
both at holding company level and throughout the PROTON Group.
Re-Election of Directors
All Directors including the Executive Director are subject to retirement by rotation at least
once in every three years and are eligible for re-election. In accordance with the Articles of
Association and the Listing Requirements of Bursa Malaysia Securities Berhad, at least 1/3 of
the Directors shall retire from office at each Annual General Meeting. Any new appointed
director shall hold office only until the next Annual General Meeting of the Company and
shall be eligible for re-election under Article 111. Directors who are over seventy (70) years
of age are required to submit themselves for retirement annually at the Annual General
Meeting, unless the Director is re-appointed by way of special resolution in accordance with
Section 129 (6) of the Companies Act, 1965.
At the forthcoming Annual General Meeting of PROTON Holdings Berhad the following
Directors will retire and are eligible for re-election:
(i) Pursuant to Article 104

• Dato’ Michael Lim Heen Peok
• Tuan Haji Abdul Kadir Bin Md Kassim
• Tuan Haji Abdul Jabbar Bin Abdul Majid
Note: Tuan Haji Abdul Jabbar Bin Abdul Majid although eligible, does not seek re-election.
(ii) Pursuant to Article 111

• Dato’ Mohd Nadzmi Bin Mohd Salleh
• Encik Oh Kim Sun
None of the Directors are subject to retirement pursuant to Section 129 of the Companies
Act, 1965 at the forthcoming Annual General Meeting.

Board Committees
The Board has delegated specific responsibilities to five (5) sub-committees, namely the Board Executive
Committee, Board Audit Committee, Board Nomination & Remuneration Committee, Board Risk Management
Committee and Board Disciplinary Committee, which assist the Board in overseeing the affairs of the
Group and have been entrusted with specific responsibilities and authority and report to the Board with
recommendation.
The abovementioned Board Committees have the authority to examine specific issues and report to the Board
with their recommendations. The responsibility of decisions on all matters ultimately lies with the Board as a
whole.
Board Audit Committee

The Board Audit Committee (“BAC”) met eight (8) times during the course of the financial year. The composition
of the BAC and their respective attendance record of meetings for the financial year ended 31 March 2009
are as follows:
No Name of Director Designation Date of Date of Meeting

1 Tuan Haji Abdul Jabbar Bin Chairman – Independent 10 March 2005 N/A 8/8
Abdul Majid – Chairman* Non-Executive Director
2 Tuan Haji Abdul Kadir Bin Member – Independent 10 March 2005 N/A 7/8
Md Kassim Non-Executive Director
3 Dato’ Michael Member – Independent 29 November 2006 N/A 8/8

Lim Heen Peok Non-Executive Director
*Note: Encik Oh Kim Sun was appointed as Member and Chairman of the Board Audit Committee on 1
June 2009. Tuan Haji Abdul Jabbar Bin Abdul Majid was on the same date re-designated as
Member of the Board Audit Committee.
During the financial year, the BAC of PROTON Holdings Berhad undertook the following activities:
• Assisted the Board in discharging its statutory duties and responsibilities relating to accounting and
reporting practices of the Company and the Group in accordance with Generally Accepted Accounting
Practices.
• Reviewed the external audit terms of engagement, the audit strategy, the proposed audit fee and the
achievement of the agreed upon reporting timeframes for the audit of the financial statements.
• Reviewed the external audit reports and discussed any problems and reservations arising thereon.
• Reviewed the internal audit plan, methodology, functions and resources.
• Reviewed major findings on internal audit reports and management response.
144
The Terms of Reference of the Board Audit Committee are set out below.
Composition
The Committee shall be appointed from amongst the Board and shall:-
• comprise no fewer than three members;
• all the members must be independent directors; and
• at least one member must be a member of the Malaysian Institute of Accountants
or if he is not, then he must be a person who complies with Para. 15.10 of Bursa
Malaysia Securities Berhad’s Listing Requirements.
No alternate director may be appointed as a member of the Board Audit Committee.
The Board will review the terms of office and the performance of the Board Audit Committee
and its members at least once every three years.
Functions and Duties

The functions and duties of the Board Audit Committee shall be to:-
(a) Review and report to the Board of Directors on the following:-
• with the External Auditors, the audit plan;
• with the External Auditors, the External Auditor’s evaluation of the system of
internal controls;
• with the External Auditors, the External Auditor’s audit report;
• the assistance given by the Company’s employees to the External Auditors;
• the adequacy of the scope, functions and resources of the internal audit
functions and that it has the necessary authority to carry out its work, and the
performance of the members of the internal audit function;
• the internal audit programme, processes, the results of the internal audit
programme, or investigation undertaken and whether or not appropriate action is
taken by the management on the recommendations of the internal audit function;
• the quarterly results and year-end financial statements, prior to the approval by
the Board of Directors, focusing particularly on:-
– changes in or implementation of major accounting policy;
– significant and unusual events;
– compliance with accounting standards and other legal requirements; and
– accuracy and adequacy of the disclosure of information essential to a fair
and full presentation of the financial affairs of the Group;
• any related party and conflict of interest situation that may arise within the
listed issuer or group including any transaction, procedure or course of conduct
that raises questions of management integrity;
• promptly report to Bursa Malaysia Securities Berhad on any matter reported by it to
the Board of the Company which has not been satisfactorily resolved resulting in a
breach of the Listing Requirements of Bursa Malaysia Securities Berhad;
• submit to the Board a Report on the summary of activities of the Board Audit
Committee in the discharge of its functions and responsibilities in respect of each
financial year.
(b) Consider the appointment of the external auditor, the audit fee and any questions
of resignation and dismissal.

Meetings
The Committee shall hold meetings on at least four occasions each year, although additional
meetings may be called, as and when necessary, by the Chairman of the Committee. These
meetings will usually be:-
• prior to the current year’s audit;
• upon completion of the External Auditor’s interim examination;
• prior to the meeting of the full board to approve the financial statements;
• prior to the announcement of the quarterly results;
• upon the request of any member of the Committee or the External Auditors, the
Chairman of the Committee shall convene a meeting of the Committee to consider
the matters brought to its attention;
• at least once a year, the Committee shall meet with the External Auditors without
any Executive Directors present.
Attendance
In order to form a quorum in respect of a meeting of an audit committee, the majority
of members must be present throughout the meeting. The Chairman may request that
directors and members of the management, the Internal Auditors and representatives of
the External Auditors be present at meetings of the Committee.
Minutes
The Company Secretary shall be the Secretary to the Committee and shall be present at all
meetings to record minutes.
Minutes of each meeting shall be prepared and entered into the books provided for the
purpose and sent to the Committee members and will be made available to all Board
members. The minutes shall be signed by the Chairman of the Committee.
Internal Audit Function

The Group uses the services of the Group Internal Audit Division to accomplish its internal
audit requirements. The Group Internal Audit Division reports to the Board Audit Committee
on matters concerning the Group and assists the Board of Directors in monitoring and
managing risks and internal controls.
The Group Internal Audit Division reviews internal controls related to all key activities of
the Group and recommends improvements in controls and procedures. The Group Internal
Audit Division is independent of the activities it audits and performs with impartiality and
due professional care. The findings of the Group Internal Audit Division are reported to the
Board Audit Committee.
The Board Audit Committee approves the internal audit plan of the Group Internal Audit
Division each year. The scope of the internal audit covers the audits of all units and operations,
including subsidiaries.
146
During the year, the Group Internal Audit Division serves to ensure internal control measures are adequate
and effective in mitigating key risks and that they are monitored. The monitoring process will form the basis
for continually improving the risk management process in the context of the Group’s overall goals.
Board Nomination & Remuneration Committee

The objectives of the Board Nomination & Remuneration Committee (“NRC”) are in accordance with the Terms
of Reference as approved by the Board of Directors of PROTON on 26 July 2006.
The NRC reviews new director appointments of the Group and the balance and effectiveness of the boards
of directors, taking into account the required mix of skills and experience and other qualities, before making
recommendations to the Board.
The Committee is empowered to conduct periodic reviews on the overall remuneration policy and package
of the Executive and Non-Executive Directors and Senior Level Mission Critical Positions of the Group for
recommendation to the Board.
The authority and scope of coverage of the NRC is over the PROTON Group, which includes subsidiaries and
relevant associate and other investee companies.
The NRC is made up entirely of Non-Executive Directors, with the majority consisting of Independent
Non-Executive Directors.
Appointments to the Committee shall be for a period of three (3) years, which may be extended provided that
the majority of the Committee members remain independent.
The NRC met eight (8) times during the financial year.
The Composition of the NRC is as follows:

1 Dato’ Mohd Nadzmi Chairman – 1 January 2009 N/A 2/2

Bin Mohd Salleh Non-Independent
Non-Executive Director
2 Encik Ahmad Tajuddin Member – Independent 29 August 2005 N/A 8/8

Bin Abdul Carrim
3 Encik Md Ali Bin Member – Independent 29 August 2005 N/A 8/8

Md Dewal
4 Dato’ Michael Member – Independent 13 November 2006 N/A 8/8

Lim Heen Peok Non-Executive Director
5 Dato’ Mohammed Azlan Chairman – 10 March 2005 1 January 2009 6/6

Bin Hashim Non-Independent
Non-Executive Director

Board Risk Management Committee

The Board Risk Management Committee (“BRMC”) assists the Board to oversee the overall management of all
risks faced by the Group’s business. Further details of the activities of the Board Risk Management Committee
are spelt out in the Statement of Internal Control.
The BRMC is made up entirely of Non-Executive Directors and third party members (not being directors of the
Company) who are appointed by the Board from time to time as follows:

1 Tuan Haji Abdul Kadir Chairman – Independent 29 September 2005 N/A 4/4
Bin Md Kassim Non-Executive Director
2 Datuk Tan Kim Leong Member – Independent 29 August 2005 N/A 3/4
3 Dato’ Zainuddin
Bin Che Din Member – Independent 1 October 2008 N/A 3/3
The composition of the BRMC is reviewed annually by the Board of Directors based on the recommendation
of the NRC.
The Group Risk Management Unit (GRMU) is entrusted with the responsibility for ensuring that an appropriate
risk management framework exists within the Group and is effectively implemented to manage the key risks
of the organization on an on-going basis.
The GRMC, which comprises of Senior Management, is responsible for overseeing risk management
implementation, regular updating of the Group’s risk profiles and improving the implementation of
methodology for risk management. The Committee deliberates and determines the Group’s major risks
to be escalated to the attention of the BRMC.
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Board Disciplinary Committee (“BDC”)

The BDC is a platform for the PROTON Group to deal primarily with disciplinary issues. The BDC is part of the
structural mechanism for the handling of cases that may arise from the introduction of the Whistleblower and
Assets Declaration Policies. The BDC has the power to initiate investigations, consider and take appropriate
action on any case referred to it by any party either received orally or in writing.
The BDC comprises members all of whom are non executive directors as follows:

1 Dato’ Mohd Nadzmi Chairman – Non-Independent 1 January 2009 N/A N/A

Bin Mohd Salleh Non-Executive Director
2 Tuan Haji Abdul Kadir Member – Independent 7 May 2006 N/A 2/2
Bin Md Kassim Non-Executive Director
3 Tuan Haji Abdul Jabbar Member – Independent 7 May 2006 N/A 2/2
Bin Abdul Majid Non-Executive Director
4 Tuan Haji Yusof Member – Independent 21 February 2008 N/A 2/2

Bin Ahmad Non-Executive Director
5 Dato’ Mohammed Azlan Chairman – Non-Independent 7 May 2006 1 January 2009 2/2
Bin Hashim Non-Executive Director
PROTON Board Executive Committee

The objectives of the Board Executive Committee (“Board EXCO”) is to assist the Management in addressing
issues relating to implementation and monitoring of several key projects, including but not limited to PROTON
Strategic Business Plan, Annual Management Plan, PROTON Business Turnaround Plan and also to address
issues relating to identifying suitable candidates to fill in several key positions for PROTON. It is to be noted
that the functions of the Board EXCO shall not overlap that of other Board Committees, such as the Board
Nomination & Remuneration Committee.
Subject to the resolutions of the Board of Directors of PROTON from time to time, the provisions contained in
the Terms Of Reference and the Memorandum and Articles of Association of the Company, the Board EXCO
may exercise any of the powers, authorities and discretions for the time being vested in the Board of Directors
with regard to the affairs and business of the Company.

PROTON’s Board EXCO comprises two (2) representatives from amongst the PROTON Board Members and two
(2) Senior Management representatives as follows:

1 Dato’ Mohd Nadzmi Chairman / Non-Independent 1 January 2009 N/A 3/3

Bin Mohd Salleh Non-Executive
2 Dato’ Haji Syed Zainal Managing Director 17 April 2007 N/A 15/18
Abidin B Syed Mohamed
Tahir
3 Dato’ Michael Independent Non-Executive 17 April 2007 N/A 18/18

Lim Heen Peok Director
4 Vimala Menon Director of Finance and 16 June 2008 N/A 12/12

Corporate Affairs
5 Dato’ Mohammed Azlan Chairman / Non-Independent 17 April 2007 1 January 2009 15/15
Bin Hashim Non-Executive Director
Directors’ Training
All Directors have successfully completed the Mandatory Accreditation Programme conducted by the Research
Institute of Investment Analysts’ Malaysia as imposed by Bursa Malaysia Securities Berhad.
Despite repeal of Bursa Malaysia Securities Berhad’s Continuing Education Programme with effect from 1
January 2005, the Directors continue to identify and attend appropriate seminars and courses to keep abreast
of changes in legislation and regulations affecting the Group.
The Company has arranged various in-house training programmes and luncheon talks on topics relevant to
the Company, which were attended by both the members of the Board and Senior Management. PROTON
has engaged the services of a global growth consulting company to share global and regional automotive
knowledge with the Board Members and Management through various types of workshops. The goal of
this engagement is to deliver continuous learning to PROTON through interactive sessions supported by
market analysis, technology trends, best practices, economic and policy impact analysis from across the region.
The automotive consultant has during the course of the year conducted workshops and luncheon training
programmes for both the Directors and Management of PROTON Group.
The Directors have also in the course of the year attended programmes for building high performance directors,
the Chairman’s Forum, workshops, conferences and talks including those organised by the Malaysian Directors
Academy, better known as “MINDA”, an initiative under the GLC Transformation Programme.
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Directors’ Remuneration
The NRC is responsible for reviewing the performance of the Executive Directors and recommending to the
Board the remuneration package and reward structure. The Board as a whole determines the remuneration
of the Executive and Non-Executive Directors. Directors do not participate in any discussions or decisions
concerning each individual’s remuneration.
In the case of the Executive Director, the remuneration is structured to link rewards to corporate and individual
performance through key performance indicators comprising fixed and performance-based rewards.
The level of remuneration of the Non-Executive Directors reflects the experience and level of responsibilities
undertaken by the Director concerned. The Non-Executive Directors are paid annual fees and attendance
allowances in accordance with the number of meetings attended. In addition, the Non-Executive Directors are
each provided with the use of a car.
Non-Executive Directors fees are paid upon shareholders approval at each Annual General Meeting.
The NRC carries out reviews when appropriate and refers to remuneration surveys and consultants to assist
in determining the appropriate level of reward, which is competitive and consistent with the corporate
objectives. This is necessary in order to attract and retain professionals with the qualities needed to manage
the Group successfully.
Details of the total remuneration of the Directors of PROTON Holdings Berhad for the financial year ended 31
March 2009 are as follows:
Directors Basic Salaries, Bonus and Fees and Benefits Total

Other Employee Benefits Allowances in Kind
Executive Directors 814,464 - 81,126 895,590

Non-Executive Directors - 1,522,454 59,276 1,581,730
TOTAL 814,464 1,522,454 140,402 2,477,320
Remuneration Number of Directors

Range of Total Remuneration Executive Non-Executive Total
Below RM50,000 - - -
RM50,001 – RM100,000 - 2 2
RM100,001 – RM500,000 - 2 2
RM500,001 – RM1,000,000 1 2 3
TOTAL 1 6 7

Financial Reporting
The Board is committed to providing a balanced, clear and meaningful assessment of the
financial performance and prospects of the Group to shareholders, the investor community
and the regulatory authorities. Shareholders and other stakeholders are kept abreast of the
Group’s performance through the timely announcement of the quarterly financial results
and accompanying press releases.
The Board Audit Committee assists the Board to oversee the financial reporting processes
and the quality of its financial reporting. Quarterly financial results and annual financial
statements are reviewed by the Board Audit Committee to ensure adequacy and
completeness of information prior to the Board’s approval. To enhance quality of the
Group’s financial reporting, the external auditors will be conducting quarterly reviews of
the Group’s quarterly results in addition to the year-end audit.
Directors Responsibility Statement

The Board is required by the Companies Act, 1965, to ensure that financial statements
prepared for each financial year have been made out in accordance with the applicable
approved accounting standards and give a true and fair view of the state of affairs of the
Company and the Group at the end of the financial year and of the results and cash flow of
the Company and the Group for the financial year.
The Board is responsible for ensuring that the Company keeps accounting records which
disclose with reasonable accuracy, the financial position of the Company and the Group
and that the financial statements comply with the Companies Act, 1965.
In preparing the financial statements the Board has:
• selected suitable accounting policies and applied them consistently;

• made judgements and estimates that are reasonable and prudent;
• ensured that all applicable accounting standards have been followed; and
• prepared financial statements on the going concern basis as the Directors have
a reasonable expectation, having made enquiries, that the Group has adequate
resources to continue in operations for the foreseeable future.
Internal Controls
The Board acknowledges its overall responsibility for maintaining a system of internal controls
that provides assurance of effective and efficient operations and compliance with laws and
regulations and also its internal procedures and guidelines. The size and complexity of the
operations may give rise to risks of unanticipated or unavoidable losses.
The system of internal controls is designed to provide reasonable but not absolute assurance
against the risk of material errors, frauds or losses occurring. The Board Audit Committee
reviews the effectiveness of the system of internal controls, which cover financial, operational
and compliance controls, and also risk management.
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Relationship with Auditors

The Board Audit Committee maintains an appropriate transparent relationship with both the
Group external auditors and internal auditors. The external auditors are invited to attend
Board Audit Committee meetings and present their audit findings when the Company’s annual
financial results are considered. The Board Audit Committee meets with the external auditors at
least once a year without the presence of the Executive Director and management.
Dialogue Between The Company and Shareholders / Investors

The Board recognises the importance of transparency and accountability to its shareholders
and investors. Different channels of communication are optimised to provide shareholders and
investors with a balanced and complete view of the Group performance and the issues faced by
its businesses in the competitive environment amidst a changing landscape.
The issue of the Annual Report is an important medium of information for the shareholders
and investors whereas the Annual General Meeting of the Company is the main forum for
communication and dialogue with the shareholders. Shareholders are encouraged to actively
participate and interact with the Board and members of the Senior Management pertaining to
the items on the agenda during the general meeting.
In addition, the Chairman briefs the shareholders on the Company’s operations for the financial
year. Senior management and the external auditors are present to respond to questions and
queries to ensure a high level of accountability and transparency of the business goals, strategy
and operations.
The Board strives to maintain a good dialogue with shareholders and regular meetings
are held with institutional shareholders throughout the year to discuss the progress of
the Group, future growth prospects and strategy. In the course of the year the Board and
Management have engaged in dialogue sessions with the Major Shareholders of PROTON
and the representatives from the Malaysian Institute of Corporate Governance and Minority
Shareholder Watchdog Group. Other channels of communication include Company
presentations, seminars, press releases, and interim and annual reports. There is a Company
website, www.proton.com, which provides information on the Company for all shareholders
and the general public.
Besides the Annual Report, the Board ensures timely announcements are made to Bursa
Malaysia Securities Berhad and disseminates clear, accurate, and sufficient information to enable
the shareholders and investors to make informed decisions. The Investor Relations Unit also
proactively disseminates appropriate and relevant information to the investor community and
attends to whatever queries they may have.
Code of Conduct and Discipline

PROTON has in place a Code of Conduct and Discipline. Every employee is required to comply
with this said code and as may be determined by the Board, from time to time. This code
consists of matters, prohibitions, duties or procedures relating to his / her employment.

Such code may be modified, added to, substituted for or otherwise amended from time to
time as the Board deems fit. An employee is also required to comply with the penal code
of the country.
Code of Ethics
The PROTON Group has established specific rules and regulations to govern the conduct of its
employees. The Directors and employees of PROTON Group are expected to obey all laws in
conducting business and to always act with honesty, integrity, loyalty, trustworthiness, fairness
and responsibility.
It is PROTON’s policy and Management’s responsibility to apply these rules fairly and equitably
to all employees.
Infringement of these rules may lead to disciplinary action such as “verbal or written warnings”,
“suspension without pay” and “separation from the Company/Group”.
Purpose of Policy
The purpose of this policy is to provide a framework for the proper conduct of directors and
employees while on the job. The policy gives Directors and employees guidance in identifying
business situations which have the potential to create legal and ethical problems and to provide
directions in handling those potential and actual situations.
The respective codes are made available to the Directors and employees.
Whistleblower Policy
PROTON had on 27 July 2006 implemented a Whistleblower Policy. The objective of the policy
is to provide a mechanism for preventive and corrective action within the Group without the
negative effects that come with public disclosure, such as loss of Company image or reputation,
financial distress and loss of investor confidence.
The policy encourages employees or representatives of PROTON to disclose genuine concerns

about illegal, unethical or improper business conduct within the Group. In this manner, the
employees can help the PROTON Group to monitor and keep track of such illegal, unethical or
improper business conduct within, which otherwise, may not be easily detected through normal
process or transaction.
Business Conduct
The Group is committed to the highest standards of business conduct and seeks to
maintain these standards across all of its operations throughout the world. The Group
has in place group finance policies and employee procedures.
The Group has an appropriate organisational structure for planning, executing, controlling
and monitoring business operations in order to achieve group objectives. Lines of
responsibility and delegations of authority are documented.
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Additional Compliance Information
Non-Audit Fees
During the financial year, the amount of non-audit fees paid and payable to the external auditors by the
Group are as follows:
External Auditors 2009 2008

RM’000 RM’000
PricewaterhouseCoopers Malaysia 2,120 1,234
Member firm of PricewaterhouseCoopers International Limited 2,545 1,961
(a separate and independent legal entity from
PricewaterhouseCoopers Malaysia)

Total 4,665 3,195
Additional compliance information in accordance with Appendix 9C of the Listing Requirements of Bursa
Malaysia Securities Berhad.
Utilisation of Proceeds Raised from Corporate Imposition of Sanctions / Penalties

Proposals There were no public sanctions and / or penalties
There were no proceeds raised from corporate imposed on the Company and its subsidiaries,
proposals during the financial year. Directors or Management by relevant regulatory
bodies during the financial year.
Share Buy-back
There was no proposal by the Company to carry out a Variation in Results
share buy-back during the financial year. There were no profit estimations, forecasts or
projections made or released by the Company during
Options, Warrants or Convertible Securities the financial year.
The Company did not issue any warrants or convertible
securities during the financial year. Profit Guarantee
There was no profit guarantee for the financial year.
American Depository Receipt (“ADR”) or

Material Contracts
Global Depository Receipt (“GDR”)
There was no material contract entered into by the
Programme
PROTON Group involving the interest of Directors and
The Company did not sponsor any ADR or GDR
major shareholders, either still subsisting at the end
Programme during the financial year.
of the financial year ended 31 March 2009 or entered
into since the end of the previous financial year.
156
Revaluation Policy on Landed Properties The Employees Provident Fund Board (“EPF”) which
The Significant accounting policies on property, plant currently holds approximately 15.896% of the issued
and equipment are disclosed in Note 3(e) of the and paid up capital of PROTON is not deemed a
Summary of Significant Accounting Policies. related party by virtue of the fact that EPF and / or
person(s) connected with EPF:
Recurrent Related Party Transactions
On 8 June 2007, PROTON obtained exemption from a. is / are not the largest shareholder of the
Bursa Malaysia Securities Berhad (“Bursa”) from Company
disclosing Recurrent Related Party Transactions with b. is / are not a party to any transaction, initiator,
Khazanah Nasional Berhad’s investee companies. As agent or involved in any manner in any
a result, PROTON is not required to seek shareholders’ transaction with the PROTON Group; and
mandate for such transactions at the forthcoming c. does not have any representative in an executive
Annual General Meeting of the Company. capacity on the Board of Directors of PROTON or
any of the subsidiaries.
Further, Bursa had on 14 December 2006 amended
the Listing Requirements pertaining to related party The third largest major shareholder, Petroliam
transactions whereby the threshold for a major Nasional Berhad, holds 7.851% equity interest in
shareholder was increased from 5% to 10% of the PROTON.
aggregate nominal amount of voting shares in a
company, provided that the said shareholder is not
the largest shareholder of the company.

Below is a list of Recurrent Related Party Transactions entered during the period for the financial year ended
31 March 2009.
Transacting Related Party Nature of Transaction Company within Actual

the PROTON Group 01/04/08 -
31/03/09
1 Lub Dagangan Sdn Bhd Purchase of lubricants PONSB 2,709,289
2 Petronas Dagangan Sdn Bhd Purchase of lubricants PONSB 3,794,840
3 Petronas Dagangan Sdn Bhd Purchase of lubricants PESB 10,995,796
4 EON Sale of goods PESB 1,868,300,918
5 EON Sale of goods PPCSB 113,925,867
6 Johnson Controls Auto Holding Purchase of goods PPCSB 496,344
7 Johnson Controls Auto Seating Purchase of goods PONSB 96,628,802
8 Johnson Controls Auto Interior Purchase of goods PONSB 4,808,244
9 PPCSB Purchase of goods PONSB 2,454,309
10 PPCSB Sale of goods PONSB 25,558,760
11 PPCSB Purchase of parts PESB 87,132,079
12 PPCSB Sale of goods PCUK 7,021
13 PPCSB Purchase of parts PCUK 3,180,114
14 PPCSB Purchase of parts PCA 2,862,809
15 PPCSB Purchase of parts PSPL 603,777
158
Transacting Related Party Nature of Transaction Company within Actual

the PROTON Group 01/04/08 -
31/03/09
16 PPCSB Purchase of parts PEI 1,946,237
17 Hicom Teck See Purchase of parts PONSB 201,301,804
18 Hicom Teck See Purchase of parts PPCSB 3,087,740
19 Tenaga Nasional Berhad Sale of goods PESB 869,236
20 Oriental Summit Industries Purchase of parts PONSB 63,304,332
21 Oriental Summit Industries Purchase of parts PPCSB 1,463,932
22 PHN Industry Sdn Bhd Purchase of goods PONSB 123,622,655
Definition:
PONSB Perusahaan Otomobil Nasional Sdn Bhd
PESB Proton Edar Sdn Bhd
PPCSB Proton Parts Centre Sdn Bhd
PCUKL Proton Cars (UK) Ltd
PCA Proton Cars Australia Pty Limited
P’Spore Proton Singapore Pte Ltd

Statement on Internal Control
The Malaysian Code on Corporate Governance requires listed
companies to maintain a sound system of internal control
to safeguard shareholders’ investments and the Group’s
assets. Directors of listed companies are required to make
disclosures in their annual reports on the state of internal
control in accordance with the Listing Requirements of
Bursa Malaysia Securities Berhad (“Bursa Malaysia”). Bursa
Malaysia’s Statement on Internal Control: Guidance for
Directors of Public Listed Companies (“Guidance”) provides
guidance for compliance with these requirements. The
Board’s Internal Control Statement, which has been prepared
in accordance with the Guidance, is set out below.
Board Responsibility
The Board of Directors (Board) recognises the importance of sound internal controls
and risk management practices to good corporate governance. The Board has an overall
responsibility for the Group’s system of internal controls and its effectiveness, as well as
reviewing its adequacy and integrity. The Group’s system of internal controls is designed
to manage the principal business risks that may impede the Group from achieving its
business objectives. The system, by its nature, can only provide reasonable but not absolute
assurance against any material misstatement or loss occurrence.
160
Risk Management
Risk management is regarded by the Board to be an integral part of the Group’s operations
with the objective of maintaining a sound internal control system and ensuring its continuing
adequacy and integrity. A formal risk management framework and policy was approved
by the Board for the Group to identify, assess, treat, report and monitor, key risks faced
by the Group. The effectiveness of the risk mitigation actions are reviewed quarterly by
the Group Risk Management Committee (GRMC) and Board Risk Management Committee
(BRMC) respectively.
The Group Risk Management Unit (GRMU) is entrusted with the responsibility of ensuring
that an appropriate risk management framework exists within the Group and is effectively
implemented to manage the key risks of the organisation on an on-going basis.
The GRMC, which comprises Senior Management, is responsible for overseeing risk
management implementation, regular updating of the Group’s risk profiles and improving
the implementation of methodology for risk management. The Committee deliberates and
determines the Group’s major risks to be escalated to the attention of the BRMC.

The BRMC was established to deliberate major risks highlighted by the management and
assist the Board in reviewing Group’s risk policies and strategies.
For the financial year ended 31 March 2009, the GRMC and BRMC have held quarterly
meetings in accordance with their respective terms of reference.
Assurance Mechanism
Apart from risk management activities, the Board and Management have established
other processes for identifying, evaluating and managing significant risks faced by the
Group. They continue to strive in enhancing and implementing the internal control system
to manage those risks that could affect the Group’s growth and financial viability. These
processes include updating the system of internal controls when there are changes to the
business environment or regulatory guidelines. The key elements of the Group’s control
environment include:

Board Committees
Board Committees were established by the Board to assist the Board in the execution of
its responsibilities to provide oversight on the effectiveness of the Group’s operations.
The responsibilities and authority of the Committees are governed by specific terms of
reference and these Committees are accountable to the Board.
The Board Committees are:

• Audit Committee
• Nomination and Remuneration Committee
• Risk Management Committee (“BRMC”)
• Disciplinary Committee
• PROTON Board Executive Committee (“EXCO”)
The details of the abovementioned Board Committees are set out in the Statement of
Corporate Governance.
Board Audit Committee

The Board has delegated the duty of reviewing and monitoring the effectiveness of the
Group’s system of internal controls to the Board Audit Committee (BAC).
162
The BAC assumes the overall duties of reviewing with the external auditors their audit
plan, audit report, as well as their findings and recommendations on internal controls
highlighted annually in the Internal Control Memorandum. Throughout the financial year,
the BAC was updated on the developments of Malaysian Financial Reporting Standards, as
well as legal and regulatory requirements. It also reviews the effectiveness of the internal
audit function with particular emphasis on the scope and quality of audits, resources as
well as the independence of the Group Internal Audit Division (GIAD).
The BAC continues to meet regularly and has full and unimpeded access to the internal and
external auditors and all employees of the Group.
Further information relating to the activities of the BAC is set out in the Statement of
Corporate Governance.
Organisation Structure and Management Committees

An organisation structure, which is aligned to the business and operational requirements
and led by Heads of Division with clearly defined lines of responsibility, accountability and
levels of authority, is in place to assist in implementing the Group’s strategies and day-to-
day business activities.
Various functional committees were set up at the Management level to ensure the Group’s
actions and operations are properly aligned towards achieving the organisation’s goals and
objectives.
Group Internal Audit Division (GIAD)

GIAD continues to independently monitor compliance with internal policies and procedures,
effectiveness of the internal control systems and highlights significant findings for corrective
actions by line management and reports directly to the BAC.
The annual audit plan which covers PROTON and its subsidiary companies and which was
established primarily on a risk-based approach, is reviewed and approved by the BAC
annually. A quarterly work status update is given by the GIAD to the BAC. GIAD regularly
reviews the approved annual audit plan to ensure significant risk areas are given adequate
audit focus.

The interests of PROTON in associated companies and jointly controlled entities are primarily
served through representation on the board of directors of the respective companies.
Internal controls of associated companies and jointly controlled entities are reviewed upon
any ad-hoc request by the BAC.
On a quarterly basis, GIAD updates the BAC on the status of corrective actions taken by
line management arising from the audit findings highlighted by both GIAD and the
external auditors.
Further information relating to the activities of GIAD is set out in the Statement of Corporate
Governance.
Other Key Elements of Internal Control

The other key elements of the Group’s internal control systems are described below:-
• Defined delegation of responsibilities to committees and management of head

office and operating units, including authorisation levels for various aspects of the
business, which are set out in the Limits of Authority;
• Documented internal policies and procedures as set out in the Group Policies and
Procedures and ISO 9001:2000 certification of the Quality System Procedures for
PROTON and major subsidiaries within the Group;
• Quarterly financial statements and the Group’s performance are deliberated by the
BAC, which subsequently presents them to the Board for their review, consideration
and approval;
• Management Committee meetings are held on a regular basis to identify, discuss and
resolve operational, financial and key management issues;
• A comprehensive budgeting process where the annual budgets are approved by the
Board;
• The Board receives and reviews monthly reports from Management on key strategic
and operational issues and provides direction to Management;
164
• Regular visits to operating units by Senior Management;
• Various improvement programmes were established in PROTON and its subsidiaries to

enhance its business operations;
• Continuous training efforts to enhance the leadership quality and competency of the
workforce;
• Regular employee perception surveys were conducted to obtain feedback from

employees to promote continuous improvements; and
• Formal employee appraisal system for effective coaching and evaluation of employee
performance using established Key Performance Indicators (KPIs).
For the financial year under review, after due and careful inquiry and based on the
information and assurance provided, the Board was satisfied that the key elements of
internal controls are in place. Nevertheless, identified areas of concern are being accorded
closer attention and more regular monitoring to ensure key internal controls are adequate
and effective to continually safeguard shareholders’ investment and the Group’s assets.

Risk Management
Embracing Challenges
PROTON is exposed to a multitude of risks, either residual or inherent in
the course of its daily operations. Ensuring that these risks are effectively
managed and capitalised is imperative in order to ensure maximisation
of shareholders value.
Overview
The Group recognises the importance of a sound risk management system throughout the
organsation to provide reasonable assurance to the shareholders that the risks the Group
is exposed to be are being effectively managed, controlled and capitalised. PROTON’s
risk management framework, formulated in 2003, ensures a consistent application of risk
management across the Group, through a standardised risk registration and reporting
system. Through this effort, Management and the Board are able to deliberate risk issues
on a uniformed and scheduled basis.
Risk Management Framework

PROTON’s risk management framework was implemented to provide a complete cycle of
managing risks. It consists of Risk Policy and Strategy, Risk Governance and Structure, Risk
Measurement and Risk Operations and Systems.
Risk Policy and Strategy

The PROTON Risk Management policy was revised in 2007 to act as a guiding mechanism
in implementing a standardised and robust risk management practice throughout the
organisation. Effective management and monitoring systems are combined into uniform
risk management programmes, to meet the best practice requirements and for business
value enhancement.
With the use of the risk management requirement and business concerns, risks involving
the various divisions were identified. The risks registered were further prioritised into
Corporate Risk Profile and Major risk profile. This prioritisation will ensure that efforts are
focused on high concern areas on an informed basis.
166
Risk Governance and Structure
Board of Directors Annual Review and Approval of Risk Management Policy
Board Risk Management Advises the BOD on significant changes to the Risk Management
Committee (BRMC) Policy.
Group Risk Management Identifies and evaluates principal risks and assesses the practicality of
Committee (GRMC) the proposed risk mitigation actions.
Group Risk Management Serves as the secretariat to GRMC & assist GRMC in ensuring effective
Units (GRMU) implementation of Risk Management Framework in the PROTON
Group.
Risk Champions of Business Responsible for ensuring that risk assessments are conducted in
Units relations to their business units’ activities.
Risk Management Units of Prepares risk reports regularly.

Subsidaries

Risk Management
Board Risk Management Committee (BRMC) Risk Measurement, Operations and System
The Board Risk Management Committee (BRMC) was Effective risk management is performed through
established to give assurance that an appropriate risk formalised and centralised operations and system.
management policy is in place. The BRMC provides The year in review saw major enhancements in the
overall risk strategy and clear direction to the Group risk registration format, whereby items such as Key
Risk Management Committee (GRMC) and Group Risk Indicators and Risk Appetite were incorporated.
Risk Management Unit (GRMU) in implementing the This is to cultivate more proactive risk detection within
risk management policy. the Group and promote uniformity in identifying,
rating and monitoring all types of risks.
The BRMC presided four (4) times within the period
under review. Major Initiatives
Risk Assessments for Business Planning
Group Risk Management Committee (GRMC) This year in review, risk assessments were performed
The Group Risk Management Committee (GRMC) in conjunction with the yearly business planning. All
comprising Senior Management was set up to discuss divisions within the Group, including subsidiaries,
risks that could have significant impact on the Group’s have submitted their risk registrations during this
strategic business and operating objectives and exercise. The risks collated were then prioritised into
to ensure that these risks are effectively managed. three risk profiles, Corporate Risk Profiles (CRP), Major
The GRMC assesses the practicality of the mitigation Risk Profiles (MRP) and Business Units Risk Profiles
action and escalates risks that require the Board’s (BRP). CRP and MRP were tracked and monitored in
attention to the BRMC on a quarterly basis. the GRMC and BRMC meetings.
Group Risk Management Unit (GRMU) Risk Assessment for New Product Introduction
The Group Risk Management unit (GRMU) provides During the year under review, risk assessments were
specialised resources for developing risk framework, done for the introduction of two new models. Risks
policies, methodologies, tools and appropriate related to costs, market and product acceptance were
training for Management to ensure that risk identified and mitigations were monitored.
management processes are carried out effectively and
consistently throughout the Group. Every quarter, Risk Awareness and Profiling Sessions
the GRMU will collate group-wide risk mitigation The year in review saw several risk awareness sessions
updates and escalate the reports to the GRMC and conducted. The objective of these sessions is to further
BRMC respectively. inculcate the risk management culture within the
Group. It also provides opportunities for GRMU and
Risk Champions / Risk Management Unit the risk owners to ensure that the risk registration is
The business and operations units form the first line aligned with the overall business objectives.
of defense in managing risks. They are responsible
for describing their principal risks and identifying Risk Factors
possible mitigations to address these risks. The risk Country Risk
champions, via their risk team members, ensure that PROTON conducts its businesses across regions. For
risks are continually assessed and monitored. this reason, it is exposed to risks related to pandemic,
168
Risk Management
war, terrorism, politics, natural disasters and other the form of payment for licensing and royalties
events that are beyond its control. This may disrupt and at the same time the IPR’s are duly protected.
and delay PROTON’s local supply and operations and
consequently impact the Group’s ultimate objective. Credit Risk
Risk assessments were carried out in tandem with Credit risk is inherent in any business, resulting from
country risks and were monitored regularly. default payment by customers and related parties.
Management of this risk is mainly undertaken by
Regulatory and Intellectual Property the Finance Division via credit policy, export credit
Policies regarding vehicle emission, the environment insurance and interest charges.
and fuel economy are extensive and subject to
frequent changes and scrutiny. Complying with Market Risk
this regulation requires extensive cost and effort. The third quarter of the year witnessed a global
Therefore, in order to proactively anticipate any financial crisis, which threatened the performance
changes in regulatory requirements, domestic and of the automotive industry. With the world
abroad, the Group monitors this development to economy becoming substantially less dynamic,
anticipate foreseeable requirements for future the domestic and overseas automotive markets
product development. have slid even lower. Credit crunch has resulted
in financial institutions being more stringent with
As the Group progresses towards international loan approvals, which consequently affected car
exposure, the Group is faced with many risks relating sales. Dwindling price gaps between competitors
to disclosure of intellectual property especially in and PROTON has caused intense struggle in the
connection to licensing of IPR in strategic projects. industry. FOREX volatility, increase in raw material
Appropriate measures are currently being taken prices and customer’s uncertainty all added to the
in managing all aspects of IPR by establishing an considerable economic risks which the Group has
IPR policy and issuing manuals for identification, faced in the year under review. Measures, such as
protection and commercialisation of IPR. This effort extensive hedging activities and active marketing
will significantly bring maximum benefit to the initiatives were taken to minimise the impact of
organisation by return on investments and profits in these risks.
Conclusion
Providing assurance that the risks are effectively managed requires effort and commitment
from all divisions. Risk management awareness will continue to be given top priority to
provide reasonable assurance to the shareholders that risks are effectively managed within
the Group. With support and direction from the BRMC, risk management function will
continue to move forward in enhancing the appreciation of risk management and strive
for a stronger and more resilient risk management culture in the Company.

Bright Outlook
Bright Outlook
Despite challenges, there
are highlights to keep
PROTON moving towards
its vision of being a
leading national and
regional automaker.
Calendar of Events
Aug 2008 Former Prime Minister, Tun Abdullah Haji Aug 2008 PROTON Technology Week saw more than
Ahmad Badawi officiates the launch of the three millionth 60,000 visitors visiting our facilities to understand PROTON’s
car during PROTON Technology Week 2008. capabilities in automotive technology, innovation and R&D.
Aug 2008 PROTON’s 5th Annual General Meeting. Aug 2008 Visit by H E Dr Mahmoud Mohieddin, Minister
of Investment, Egypt, with 15-member delegation.
Aug 2008 Team PROTON R3 is launched for participation Aug 2008 Staff and their families visit Rumah Anak-Anak
in the Merdeka Millennium 12 hours endurance race I (MME) Yatim Darul Aitam Temoh, Perak, one of PROTON’s adopted
with Satria Neo and Waja in Class B (1601 cc and 1900 cc) and orphanages.
Gen.2 in Class C (below 1600 cc).
172
Aug 2008 PROTON gives away bicycles to deserving Sept 2008 Buka Puasa with staff and children from local
students in Program Pintar. orphanages is a yearly activity during the month of
Ramadhan.
Sept 2008 PROTON launches the Workplace and Road Oct 2008 PROTON presents the Saga Taxi, with the new
Safety & Health Campaign in conjunction with the festive vibrant red body and yellow top. Public Cab Sdn Bhd, KCM
season holidays. Fleet Sdn Bhd, Avenue Drive (M) Sdn Bhd and Perniagaan
Lima Sejati Sdn Bhd were the first to take delivery.
Oct 2008 More than nine months after its launch, the Oct 2008 PROTON participates in the 5th China-ASEAN
Saga wins the Autocar Asean Award 2008. Expo organised by MATRADE.

Calendar of Events
Nov 2008 The 2nd International Trade Malaysia 2008 Nov 2008 PROTON strengthens its Middle Eastern
Exhibition (INTRADE Malaysia 2008) held at PWTC. presence with simultaneous launchings of the Persona
first in Riyadh, Saudi Arabia, then in Cairo, Egypt, and later
Oman, Qatar, Bahrain and Syria.
Nov 2008 The Saga is awarded Car of the Year 2008 Nov 2008 PROTON Managing Director is named
(Entry Level) by NST. “Automotive Man of the Year” at the Car of the Year
Awards by NST.
Nov 2008 Yayasan PROTON and young scholars at the Dec 2008 Persona wins 1st place as the Most Fuel Efficient
certificate Presentation Ceremony. Family Car at the Asian Auto-Bosch Fuel Efficiency Awards
2008.
174
Dec 2008 BWF Super Series Masters Final 2008 in Kota Dec 2008 PROTON signs an agreement with Zagross
Kinabalu, Sabah. Khodro for the supply of automotive parts to Iran.
Jan 2009 The official unveiling of the Satria Neo Super Jan 2009 PROTON sponsors the PROTON Malaysia Open
2000 at the Autosport Show UK 2009, for participation in 2009 Badminton Tournament.
the intercontinental rally in Belgium.
Feb 2009 Media preview of the refreshed Satrio Neo CPS. Feb 2009 PROTON Chairman and Managing Director at
the event to announce ‘Exora’ as the name for Malaysia’s first
home-grown MPV.

Calendar of Events
Mar 2009 The PROTON Showcase at the UMNO General Mar 2009 Detroit Electric Holdings Ltd and Perusahaan
Assembly Expo attracts many visitors. Otomobil Nasional Sdn Bhd agree to collaborate.
Apr 2009 Prime Minister YAB Dato’ Sri Mohd Najib Bin Apr 2009 The Exora is delivered to the first ten customers.
Tun Abdul Razak officially launches the much-anticipated
Exora.
May 2009 A new Master Dealership Agreement is signed May 2009 PROTON once again takes home the Gold
by PROTON Edar Sdn Bhd and Edaran Otomobil Nasional Award in Reader’s Digest Trusted Brand Awards.
Berhad.
176
May 2009 Dato’ Mustapa Bin Mohamed, Minister of May 2009 The 18th Malaysian Skills (Automobile Sector)
International Trade and Industry, visits the Shah Alam plant Competition is organised for the 7th year, along with the 3rd
with a 12-member delegation. PROTON Competition.
Jun 2009 Deputy Prime Minister, YAB Tan Sri Dato’ Haji Jun 2009 PROTON R3 Racing Team finishes 2nd in class
Muhyiddin Bin Mohd Yassin visiting the PROTON booth at 2 and 5th overall in the inaugural Sepang 1000KM Race.
the 12th annual SMIDEX Exhibition.
Jun 2009 PROTON together with Badminton Association July 2009 Director of Export Markets Division speaks at
of Malaysia flags off a convoy in conjunction with Malaysia’s PROTON’s International Distributor Conference in Phuket.
participation in the Singapore Open Super Series 2009.

Moving Ahead
Moving Ahead
Being committed to
meticulous care and
bringing value to
shareholders will propel
PROTON forward.
Statutory Financial Statements
Contents
181 Directors’ Report

185 Income Statements
186 Balance Sheets
188 Consolidated Statement of Changes in Equity
189 Company Statement of Changes in Equity
190 Cash Flow Statements
193 Notes to the Financial Statements
280 Statement by Directors
280 Statutory Declaration
281 Independent Auditors Report
180
DIRECTORS’ REPORT
The Directors hereby submit their report together with the audited financial statements of the Group and
Company for the financial year ended 31 March 2009.
PRINCIPAL ACTIVITIES
The Company is principally involved in investment holding activities.
The principal activities of the subsidiary companies, associated companies and jointly controlled entities
are set out in Notes 17 to 19 of the financial statements. There have been no significant changes in the
activities of the Group and Company during the financial year.
FINANCIAL RESULTS
Group Company
RM’000 RM’000
Net (loss)/profit for the financial year (301,806) 367,170
DIVIDENDS
Dividends on ordinary shares paid or declared by the Company since 31 March 2008 are as follows:
RM’000
In respect of the financial year ended 31 March 2009:
Interim dividend of 5 sen per share less tax at 25%,

paid on 14 January 2009 20,595
The Directors do not recommend the payment of a final dividend for the financial year ended 31 March 2009.
RESERVES AND PROVISIONS
There were no material transfers to or from reserves and provisions during the financial year except as
disclosed in the financial statements.

DIRECTORS’ REPORT (CONTINUED)
DIRECTORS
The Directors who have held office during the period since the date of the last report are:
Dato’ Mohd Nadzmi bin Mohd Salleh (appointed on 1.01.2009)

Dato’ Syed Zainal Abidin B Syed Mohamed Tahir
Haji Abdul Jabbar bin Abdul Majid
Haji Abdul Kadir bin Md Kassim
Dato’ Lim Heen Peok
Datuk Zalekha binti Hassan
Encik Oh Kim Sun (appointed on 13.05.2009)
Dato’ Mohammed Azlan bin Hashim (resigned on 1.01.2009)
In accordance with Article 104 of the Company’s Articles of Association, Haji Abdul Kadir bin Md Kassim
and Dato’ Lim Heen Peok retire at the forthcoming Annual General Meeting and, being eligible, offer
themselves for re-election.
Haji Abdul Jabbar bin Abdul Majid who is retiring in accordance with Article 104 of the Company’s Articles
of Association at the forthcoming Annual General Meeting does not wish to seek re-election as a Director
of the Company. Accordingly, he will retire at the conclusion of the Annual General Meeting of the
Company.
In accordance with Article 111 of the Company’s Articles of Association, Dato’ Mohd Nadzmi bin Mohd
Salleh and Encik Oh Kim Sun retire at the forthcoming Annual General Meeting and, being eligible, offer
themselves for re-election.
DIRECTORS’ BENEFITS
During and at the end of the financial year, no arrangements subsisted to which the Company is a party,
being arrangements with the object or objects of enabling Directors of the Company to acquire benefits
by means of the acquisition of shares in, or debentures of, the Company or any other body corporate.
Since the end of the previous financial year, no Director has received or become entitled to receive a
benefit (other than benefits disclosed as Directors’ remuneration in Note 8 to the financial statements)
by reason of a contract made by the Company or a related corporation with the Director or with a firm
of which the Director is a member, or with a company in which the Director has a substantial financial
interest.
DIRECTORS’ INTEREST IN SHARES AND DEBENTURES
According to the register of Directors’ shareholdings, no Director in office at the end of the financial year
held any interest in shares or debentures in the Company or its related corporations.
182
STATUTORY INFORMATION ON THE FINANCIAL STATEMENTS
Before the income statements and balance sheets of the Group and Company were made out, the Directors
took reasonable steps:
(a) to ascertain that proper action had been taken in relation to the writing off of bad debts and the
making of allowance for doubtful debts and satisfied themselves that all known bad debts had been
written off and that adequate allowance had been made for doubtful debts; and
(b) to ensure that any current assets, other than debts, which were unlikely to realise in the ordinary course
of business their values as shown in the accounting records of the Group and Company had been
written down to an amount which they might be expected so to realise.
At the date of this report, the Directors are not aware of any circumstances:
(a) which would render the amounts written off for bad debts or the amount of the allowance for doubtful
debts in the financial statements of the Group and Company inadequate to any substantial extent; or
(b) which would render the values attributed to current assets in the financial statements of the Group and
Company misleading; or
(c) which have arisen which render adherence to the existing method of valuation of assets or liabilities of the
Group and Company misleading or inappropriate.
No contingent or other liability has become enforceable or is likely to become enforceable within the period of
twelve months after the end of the financial year which, in the opinion of the Directors, will or may substantially
affect the ability of the Group and Company to meet their obligations when they fall due.
At the date of this report, there does not exist:
(a) any charge on the assets of the Group or the Company which has arisen since the end of the financial year
which secures the liability of any other person; or
(b) any contingent liability of the Group or the Company which has arisen since the end of the financial
year.

STATUTORY INFORMATION ON THE FINANCIAL STATEMENTS (CONTINUED)
At the date of this report, the Directors are not aware of any circumstances not otherwise dealt with in
this report or the financial statements which would render any amount stated in the financial statements
misleading.
In the opinion of the Directors:
(a) the results of the Group’s and Company’s operations during the financial year were not substantially
affected by any item, transaction or event of a material and unusual nature except as disclosed in Notes
5 and 13 to the financial statements; and
(b) there has not arisen in the interval between the end of the financial year and the date of this report
any item, transaction or event of a material and unusual nature likely to affect substantially the results of
the operations of the Group or the Company for the financial year in which this report is made.
AUDITORS
The auditors, PricewaterhouseCoopers, have expressed their willingness to continue in office.
Signed on behalf of the Board of Directors in accordance with their resolution dated 22 July 2009.
DATO’ MOHD NADZMI BIN MOHD SALLEH DATO’ SYED ZAINAL ABIDIN B SYED
CHAIRMAN MOHAMED TAHIR
MANAGING DIRECTOR
184
INCOME STATEMENTS
FOR THE FINANCIAL YEAR ENDED 31 MARCH 2009
Group Company
2009 2008 2009 2008
Note RM’000 RM’000 RM’000 RM’000
Revenue 6 6,486,570 5,621,594 362,357 41,203

Cost of sales 7 (6,075,913) (5,056,854) - -
Gross profit 410,657 564,740 362,357 41,203
Other operating income

- Research and development grant 80,656 193,782 - -
- Others 197,895 134,889 7,321 302
Distribution costs (187,668) (201,095) - -
Administrative expenses (515,270) (504,184) (1,329) (607)
Other operating expenses
- Impairment of property, plant
and equipment and capitalised
development cost 13 (278,476) - - -
- Others (47,401) (46,851) - -
(Loss)/profit before finance cost 7 (339,607) 141,281 368,349 40,898
Finance cost 9 (14,408) (17,936) - -

Share of results of associated
companies 18 20,220 13,134 - -
Share of results of jointly
controlled entities 19 14,594 7,837 - -
(Loss)/profit before taxation (319,201) 144,316 368,349 40,898
Taxation 10 17,395 40,235 (1,179) (10,517)

(Loss)/profit for the financial year (301,806) 184,551 367,170 30,381
Attributable to:
Equity holders of the Company (301,806) 184,551 367,170 30,381
(Loss)/earnings per share (sen)

- basic 11 (55) 34
- diluted 11 (55) 34
The notes on pages 193 to 279 form part of these financial statements.

BALANCE SHEETS
AS AT 31 MARCH 2009
Group Company
2009 2008 2009 2008
Note RM’000 RM’000 RM’000 RM’000
NON-CURRENT ASSETS
Property, plant and equipment 13 2,827,111 3,150,446 - -

Prepaid land lease payments 14 - 24,031 - -
Goodwill 15 29,008 29,008 - -
Intangible assets 16 431,668 275,192 - -
Subsidiary companies 17 - - 1,708,651 1,708,651
Associated companies 18 158,367 165,443 13,600 13,600
Jointly controlled entities 19 195,622 192,747 - -
Amounts due from subsidiary
companies 20 - - 177,870 -
Investments 21 10,397 10,397 6,475 6,475
Deferred tax assets 22 5,727 - - -
Total Non-Current Assets 3,657,900 3,847,264 1,906,596 1,728,726
CURRENT ASSETS
Inventories 23 1,395,081 1,100,286 - -

Trade and other receivables 24 890,095 969,344 145 14
companies 20 - - 58,912 66,219
Amounts due from associated
companies 25 18,284 10,713 - -
Amounts due from jointly
Tax recoverable 10 160,610 114,479 77 273
Current investments 27 15,313 20,822 - -
Dividends receivable - - - 14,800
Deposits, bank and
cash balances 28 913,850 1,226,010 209,423 26,296
Total Current Assets 3,404,586 3,446,084 268,557 107,602

Non-current assets held for sale 29 36,412 - - -
TOTAL ASSETS 7,098,898 7,293,348 2,175,153 1,836,328
186
BALANCE SHEETS
AS AT 31 MARCH 2009 (CONTINUED)
Group Company
2009 2008 2009 2008
Note RM’000 RM’000 RM’000 RM’000
EQUITY AND LIABILITIES
Share capital 30 549,213 549,213 549,213 549,213

Reserves 31 4,552,327 4,872,043 1,625,179 1,278,604
Equity attributable to equity

holders of the Company 5,101,540 5,421,256 2,174,392 1,827,817
TOTAL EQUITY 5,101,540 5,421,256 2,174,392 1,827,817
NON-CURRENT LIABILITIES
Long term liabilities 32 101,516 230,473 - -

Deferred tax liabilities 22 12,243 2,439 - -
Total Non-Current Liabilities 113,759 232,912 - -
CURRENT LIABILITIES
Trade and other payables 33 1,277,658 1,235,520 482 575

Provisions 34 189,779 186,556 - -
Amounts due to subsidiary
companies 35 - - - 7,936
Amounts due to associated
companies 36 88,606 84,984 - -
Amounts due to jointly
Taxation 6,322 1,556 279 -
Short term borrowings 38 306,039 113,606 - -
Total Current Liabilities 1,883,599 1,639,180 761 8,511
TOTAL LIABILITIES 1,997,358 1,872,092 761 8,511
TOTAL EQUITY AND LIABILITIES 7,098,898 7,293,348 2,175,153 1,836,328
Net assets per share attributable

to equity holders of the Company (RM) 9.29 9.87

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
Attributable to equity holders of the Company

Asset Foreign
Share Capital revaluation exchange Retained
capital reserve reserve reserve earnings Total
Note RM’000 RM’000 RM’000 RM’000 RM’000 RM’000
At 1 April 2008 549,213 475,617 2,362 (82,197) 4,476,261 5,421,256
Net income recognised

directly in equity
- Foreign exchange
differences on translation
of foreign operations - - - 2,685 - 2,685
Loss for the financial year - - - - (301,806) (301,806)
Total recognised income

and expense for the
financial year - - - 2,685 (301,806) (299,121)
Interim dividend for
the financial year ended
31 March 2009 12 - - - - (20,595) (20,595)
At 31 March 2009 549,213 475,617 2,362 (79,512) 4,153,860 5,101,540
At 1 April 2007 549,213 475,617 - (85,952) 4,291,710 5,230,588
Net income recognised

directly in equity
- Foreign exchange
differences on translation
of foreign operations - - - 3,755 - 3,755
Arising from business
combination - - 2,362 - - 2,362
Profit for the financial year - - - - 184,551 184,551
Total recognised income

and expense for the
financial year - - 2,362 3,755 184,551 190,668
At 31 March 2008 549,213 475,617 2,362 (82,197) 4,476,261 5,421,256
188
COMPANY STATEMENT OF CHANGES IN EQUITY
Issued and fully

p
aid ordinary shares Distributable
Nominal
Number value of Retained
of shares RM1 each earnings Total
Note ‘000 RM’000 RM’000 RM’000
At 1 April 2008 549,213 549,213 1,278,604 1,827,817
Profit for the financial year - - 367,170 367,170

Interim dividend for the financial
year ended 31 March 2009 12 - - (20,595) (20,595)
At 31 March 2009 549,213 549,213 1,625,179 2,174,392
At 1 April 2007 549,213 549,213 1,248,223 1,797,436
Profit for the financial year - - 30,381 30,381
At 31 March 2008 549,213 549,213 1,278,604 1,827,817

CASH FLOW STATEMENTS
Group Company
2009 2008 2009 2008
RM’000 RM’000 RM’000 RM’000
CASH FLOWS FROM OPERATING ACTIVITIES
(Loss)/profit for the financial year (301,806) 184,551 367,170 30,381
Adjustments for:
Taxation (17,395) (40,235) 1,179 10,517
Property, plant and equipment:
- depreciation 450,346 382,556 - -
- written off 38,746 18,557 - -
- impairment 257,674 - - -
- reversal of impairment (1,616) (800) - -
- loss/(gain) on disposal 19,417 (12,546) - -
Prepaid land lease payments:
- amortisation - 89 - -
- gain on disposal - (990) - -
Impairment of goodwill - 6,741 - -
Write down/(write back) of inventories 114,950 (25,053) - -
Impairment of investment in an
associated company 6,678 4,200 - -
Intangible assets:
- amortisation 48,493 34,817 - -
- impairment 20,802 - - -
Interest expense 14,408 17,936 - -
Interest income (42,089) (32,143) (4,618) (301)
Share of results of associated companies (20,220) (13,134) - -
Share of results of jointly
controlled entities (14,594) (7,837) - -
Current investments:
- loss/(gain) on disposal 44 (1,678) - -
- write down in market value 1,084 - - -
Reversal of allowance for doubtful debts (63,315) (19,708) - -
Allowance for doubtful debts 45,616 7,737 - -
Gain on unrealised foreign exchange (8,284) (10,230) - -
Operating profit before working

capital changes (carried forward) 548,939 492,830 363,731 40,597
190
FOR THE FINANCIAL YEAR ENDED 31 MARCH 2009 (CONTINUED)
Group Company
2009 2008 2009 2008
RM’000 RM’000 RM’000 RM’000
CASH FLOWS FROM OPERATING

ACTIVITIES (CONTINUED)
Operating profit before working

capital changes (brought forward) 548,939 492,830 363,731 40,597
Provision for warranties 62,862 45,526 - -

Provision for onerous contract 4,426 - - -
Research and development grant (80,656) (193,782) - -
(Reversal)/provision for retirement benefits (8,042) 14,616 - -
Amortisation of capital grant (21,646) - - -
Dividend income (1,260) (2,896) (362,357) (41,203)
Operating profit/(loss) before working

capital changes 504,623 356,294 1,374 (606)
Changes in working capital:

Inventories (445,982) 217,044 - -
Receivables
- trade and other receivables 161,578 73,075 (131) (9)
- subsidiary companies - - 7,307 -
- associated companies and
jointly controlled entities (14,688) 19,789 - -
Payables
- trade and other payables 108,309 196,067 (93) (215)
- provisions (102,257) (99,301) - -
- subsidiary companies - - (7,936) 288
- associated companies and
jointly controlled entities 6,606 (22,793) - -
Cash generated from/(used in) operations 218,189 740,175 521 (542)
Tax paid (31,550) (8,571) (704) -

Tax refund 9,717 108,955 - -
Interest received 47,047 32,143 4,618 301
Interest paid (12,394) (17,936) - -
Retirement benefits paid (9,369) (11,155) - -
Net cash flow generated from/

(used in) operating activities 221,640 843,611 4,435 (241)

FOR THE FINANCIAL YEAR ENDED 31 MARCH 2009 (CONTINUED)
Group Company
2009 2008 2009 2008
Note RM’000 RM’000 RM’000 RM’000
CASH FLOWS FROM

INVESTING ACTIVITIES
Purchase of property, plant

and equipment (462,781) (391,997) - -
Proceeds from acquisition of
a subsidiary company 17(a) 3,998 - - -
Additional investment in
a subsidiary company 17(b) - (32,616) - -
Purchase of intangible assets (237,632) (141,217) - -
Purchase of current investments (58) - - -
Proceeds from disposal of
current investments 4,439 54,304 - -
Proceeds from disposal of property,
plant and equipment 29,073 50,722 - -
Proceeds from disposal of prepaid
land lease payments - 1,304 - -
Dividends received 20,590 25,698 377,157 15,927
Net cash flow (used in)/generated

from investing activities (642,371) (433,802) 377,157 15,927
CASH FLOWS FROM

FINANCING ACTIVITIES
Dividend paid 12 (20,595) - (20,595) -

Proceeds from borrowings 356,506 421,598 - -
Advances to a subsidiary company - - (177,870) -
Lease and hire purchase creditors
installments paid (890) (1,293) - -
Repayment of borrowings (195,421) (132,080) - -
Release of restricted ADF 31,557 6,260 - -
Net cash flows generated from/

(used in) financing activities 171,157 294,485 (198,465) -
NET (DECREASE)/INCREASE IN
CASH AND CASH EQUIVALENTS (249,574) 704,294 183,127 15,686
EFFECTS OF EXCHANGE DIFFERENCES (24,982) (1,819) - -
CASH AND CASH

EQUIVALENTS AT THE BEGINNING
OF THE FINANCIAL YEAR 1,173,939 471,464 26,296 10,610
CASH AND CASH

EQUIVALENTS AT THE END
OF THE FINANCIAL YEAR 44 899,383 1,173,939 209,423 26,296
192
NOTES TO THE FINANCIAL STATEMENTS - 31 MARCH 2009
1 GENERAL INFORMATION
The Company is principally involved in investment holding activities.
The principal activities of the subsidiary companies, associated companies and jointly controlled entities
are set out in Notes 17 to 19 to the financial statements. There have been no significant changes in the
activities of the Group and Company during the financial year.
The Company is a limited liability company incorporated, and domiciled in Malaysia, and listed on the
Main Board of Bursa Malaysia Securities Berhad.
The address of the registered office and the principal place of business of the Company is:
Centre of Excellence
KM 33.8, Westbound Shah Alam Expressway
47600 Subang Jaya
Selangor Darul Ehsan
Malaysia
2 BASIS OF PREPARATION
During the financial year, the Group incurred a net loss of RM301.8 million (2008: net profit for the
financial year of RM184.6 million) which was substantially due to impairment of certain property, plant
and equipment and capitalised development cost totaling RM278.5 million as well as, inventory write-
down of RM81.8 million relating to certain vehicle models impacted by sales volume contraction.
Going concern assumption

The Directors are of the opinion that the use of the going concern assumption in the preparation of the
financial statements is appropriate based on the approved Group business plan and available financing
arrangements. This includes efforts to control cash flows and the introduction of a new model in a segment
which is different from those the Group is currently in.
The Directors expect the Group to continue to operate as a going concern and accordingly, the assets and
liabilities of the Group and Company are recorded on the basis that the Group and Company will be able
to realise its assets and discharge its liabilities in the normal course of business.
Estimates and judgements

The preparation of financial statements requires the Directors to make estimates and judgements that
affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities
at the date of the financial statements and the reported amounts of revenues and expenses during the
financial year. It also requires the Directors to exercise their judgements in the process of applying the
Group’s and the Company’s accounting policies. Although these estimates and judgements are based on
the Directors’ best knowledge of current events and actions, actual results may differ.

NOTES TO THE FINANCIAL STATEMENTS - 31 MARCH 2009 (CONTINUED)
2 BASIS OF PREPARATION (CONTINUED)
Estimates and judgements (continued)

The areas involving a higher degree of judgement or complexity, or areas where assumptions and estimates
are significant to the Group’s financial statements are disclosed in Note 4 to the financial statements.
Financial Reporting Standards

The financial statements of the Group and of the Company have been prepared in accordance with
the provisions of the Companies Act, 1965 and comply with the Financial Reporting Standards (‘FRSs’),
Malaysian Accounting Standard Board (‘MASB’) Approved Accounting Standards in Malaysia for Entities
Other than Private Entities.
The financial statements of the Group and Company have been prepared under the historical cost
convention (as modified by the revaluation of certain freehold land), unless otherwise indicated in the
summary of significant accounting policies.
(a) Standards, amendments to published standards and Issues Committee (‘IC’)

interpretations that are effective and applicable to the Group
The new accounting standards, amendments to published standards and interpretations to existing
standards effective for the financial year beginning 1 April 2008 are as follows:
• FRS 107 Cash Flow Statements

• FRS 111 Construction Contracts
• FRS 112 Income Taxes
• FRS 118 Revenue
• FRS 120 Accounting for Government Grants and Disclosure of
Government Assistance
• FRS 134 Interim Financial Reporting
• FRS 137 Provisions, Contingent Liabilities and Contingent Assets
• Amendment to FRS 121 The Effect of Changes in Foreign Exchange Rates
– Net Investment in a Foreign Operation
• IC Interpretation 1 Changes in Existing Decommissioning, Restoration and Similar
Liabilities
• IC Interpretation 2 Members’ Share in Co-operative Entities and Similar Instruments
• IC Interpretation 5 Rights to Interests arising from Decommission, Restoration and
Environmental Rehabilitation Funds
• IC Interpretation 6 Liabilities arising from Participating in a Specific Market
– Waste Electrical and Electronic Equipment
• IC Interpretation 7 Applying the Restatement Approach under FRS1292004
Financial Reporting in Hyperinflationary Economies
• IC Interpretation 8 Scope of FRS 2
IC Interpretation 1, 2, 5, 6, 7 and 8 are not relevant to the Group and the Company. The adoption
of FRS 107, 111, 112, 118, 120, 121, 134 and 137 did not result in any substantial changes to
the accounting policies of the Group and the Company nor have any significant financial impact
on the financial statements of the Group and the Company.
194
(b) Standards, amendments to published standards and IC interpretations that are not
yet effective and have not been early adopted
The new standards and interpretations that are applicable to the Group and the Company, but which
the Group and the Company have not early adopted:
• FRS 7 Financial Instruments: Disclosures (effective for annual periods beginning 1 January
2010). The Group and the Company have applied the transitional provision in FRS 7 which
exempts entities from disclosing the possible impact arising from the initial application of
this standard on the financial statements.
• FRS 8 Operating Segments (effective for annual periods beginning 1 July 2009) replaces
FRS 1142004 Segment Reporting. The new standard requires a ‘management approach’, under
which segment information is presented on the same basis as that used for internal reporting
purposes.
• FRS 139 Financial Instruments: Recognition and Measurement (effective for annual periods
beginning 1 January 2010). This new standard established principles for recognising and
measuring financial assets, financial liabilities and some contracts to buy and sell non-financial
items. Hedge accounting is permitted only under strict circumstances. The Group and the
Company have applied the transitional provision in FRS 139 which exempts entities from
disclosing the possible impact arising from the initial application of this standard on the
financial statements.
• FRS 123 Borrowing costs (effective for annual periods beginning 1 January 2010) which
replaces FRS 1232004, removes the option of immediately recognising as an expense borrowing
costs that are directly attributable to the acquisition, construction or production of a qualifying
asset.
• FRS 2 Share Based Payment (Amendment) (effective for annual periods beginning 1 January
2010). This new amendment clarifies that vesting conditions are service conditions and
performance conditions only and do not include other features of a share based payment.
• FRS 127 Consolidated and Separate Financial Statements (Amendment) (effective for annual
periods beginning 1 January 2010). This amendment deals with situations where a parent
reorganises its group by establishing a new entity as its parent. Under the new rules, the new
parent measures the cost of its investment in the original parent at the carrying amount of
its share of the equity items shown in the separate financial statements of the original parent
at the reorganisation date.

(b) Standards, amendments to published standards and IC interpretations that are not
yet effective and have not been early adopted (continued)

• IC Interpretation 9 Reassessment of Embedded Derivatives (effective for annual
periods beginning 1 January 2010). IC Interpretation 9 requires an entity to assess whether
an embedded derivative is required to be separated from the host contract and accounted
for as a derivative when the entity first becomes a party to the contract. Subsequent reassessment
is prohibited unless there is a change in the terms of the contract that significantly modifies the
cash flows that otherwise would be required under the contract, in which case reassessment is
required.
• IC Interpretation 10 Interim Financial Reporting and Impairment (effective for annual periods
beginning 1 January 2010). IC Interpretation 10 prohibits the impairment losses recognised in
an interim period on goodwill and investments in equity instruments and in financial assets
carried at cost to be reversed at a subsequent balance sheet date.

• IC Interpretation 11, FRS 2: Group and Treasury Share Transactions (effective for annual periods
beginning 1 January 2010) clarifies how share based payment transactions involving its own or
another entity’s instruments in the same group are to be treated and that cancellations by
parties other than the entity are to be treated in the same way as cancellations by the entity.
• IC Interpretation 13, Customer Loyalty Programs (effective for annual periods beginning 1
January 2010) explains how entities that grant loyalty award points to its customers should
account for their obligation to provide free or discounted goods or services if and when the
customers redeem the points.
• IC Interpretation 14, FRS 119: The Limit on a Defined Benefit Asset, Minimum Funding
Requirement and their Interactions (effective for annual periods beginning 1 January 2010)
addresses how entities should determine the limit placed on the amount of a surplus in a
pension plan they can recognise as an asset. Also, it addresses how a minimum funding
requirement affects that limit and when a minimum funding requirement creates an onerous
obligation that should be recognised as a liability in addition to that otherwise recognised
under FRS 119.
(c) Standards, amendments to published standards and interpretations that are not yet
effective and not relevant to the Group’s operations
FRS 4 Insurance Contracts is effective for annual periods beginning 1 January 2010. This new
standard exempts entities from disclosing information required under paragraph 30(b) of FRS
108 “Accounting Policies, Changes in Accounting Estimates and Errors”.
196
3 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The following accounting policies have been used consistently in dealing with items which are considered
material in relation to the financial statements.
(a) Subsidiary companies

Subsidiary companies are those corporations, partnerships or other entities in which the Group
has the power to exercise control over the financial and operating policies so as to obtain benefits
from their activities, generally accompanying a shareholding of more than one half of the voting
rights. The existence and effect of potential voting rights that are currently exercisable or convertible
are considered when assessing whether the Group controls another entity.
Investments in subsidiary companies are stated at cost less accumulated impairment losses. Where
an indication of impairment exists, the carrying amount of the investment is assessed and written
down immediately to its recoverable amount. The accounting policy on Impairment of Assets is set
out in Note 3(v).
Prior to 1 January 2006, the Group applied both the purchase method and the merger method to
account for Business Combinations in accordance with prior financial reporting standards. With
effect from 1 January 2006, only the purchase method of accounting is used to account for Business
Combinations in accordance with FRS 3.
The cost of an acquisition is measured as the fair value of the assets given, equity instruments
issued and liabilities incurred or assumed at the date of exchange, plus costs directly attributable to
the acquisition. Identifiable assets acquired and liabilities and contingent liabilities assumed in a
business combination are measured initially at their fair values at the acquisition date irrespective of
the interest of any minority interest. The excess of the cost of acquisition over the fair value of
the Group’s share of the identifiable net assets acquired is recorded as goodwill. The accounting
policy on goodwill is set out in Note 3(f)(i). If the cost of acquisition is less than the fair value of the
net assets of the subsidiary company acquired, the difference is recognised as a gain in the
Consolidated Income Statements.
Subsidiary companies are consolidated from the date on which control is transferred to the Group.
They are de-consolidated from the date that control ceases.
Uniform accounting policies for like transactions and other events in similar circumstances are used
by all companies in the Group in preparing the Consolidated Financial Statements. The financial
statements of all companies within the Group used in the preparation of the Consolidated Financial
Statements are prepared as of the same reporting date.
Inter-company balances, inter-company transactions and unrealised gains on transactions between

Group companies are eliminated in full. Unrealised losses are also eliminated in full unless the assets
transferred are impaired.
Minority interests represent that portion of the profit or loss and net assets of a subsidiary company
attributable to equity interests that are not owned, directly or indirectly through the subsidiary
companies by the parent. It is measured at the minorities’ share of the fair values of the subsidiary
companies’ identifiable assets and liabilities at the acquisition date and the minorities’ share of
changes in the subsidiary companies equity since that date.

3 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
(a) Subsidiary companies (continued)

The gain or loss on disposal of a subsidiary company is the difference between the net disposal
proceeds and the Group’s share of the subsidiary company’s net assets as of the date of disposal,
including the cumulative amount of any exchange differences that relate to that subsidiary company
which were previously recognised in equity, and is recognised in the Consolidated Income
Statements.
(b) Associated companies

Associated companies are those corporations, partnerships or other entities in which the Group
exercises significant influence, but which it does not control. Significant influence is the power to
participate in the financial and operating policy decisions of the associated companies but not the
power to exercise control over those policies.
Investments in associated companies are stated at cost. Where an indication of impairment exists,
the carrying amount of the investment is assessed and written down immediately to its recoverable
amount. The accounting policy on Impairment of Assets is set out in Note 3(v).
In the Consolidated Financial Statements, investments in associated companies are accounted for
using the equity method. Under the equity method, the Group’s share of its associated companies
post-acquisition results is recognised in the income statement, and its share of post-
acquisition movements in reserves is recognised in reserves. The cumulative post-acquisition
movements are adjusted to the carrying amount of the investment. When the Group’s share of losses
in an associated company equals or exceeds its cost of investment in the associated company
including any other unsecured receivables, the Group discontinues its share of further losses, unless
it has incurred legal or constructive obligations to make payments on behalf of the associated
company.
Unrealised gains on transactions between the Group and its associated companies are eliminated to
the extent of the Group’s interest in the associated companies. Unrealised losses are also eliminated
unless the assets transferred are impaired.
In applying the equity method, the Group has ensured that uniform accounting policies for like
transactions and other events in similar circumstances of the associated companies are used. The
equity method is applied based on the latest financial statements made up to the financial year end
of the Group.
(c) Jointly controlled entities

Jointly controlled entities are corporations, partnerships or other entities over which there
is contractually agreed sharing of control by the Group with one or more parties where the strategic
financial and operating policy decisions relating to the entity requires unanimous consent of
the parties sharing control. The Group’s interests in jointly controlled entities are accounted for in
the Consolidated Financial Statements by the equity method of accounting, as disclosed in Note
3(b).
198
(c) Jointly controlled entities (continued)

Investments in jointly controlled entities are stated at cost. Where an indication of impairment
exists, the carrying amount of the investment is assessed and written down immediately to its
recoverable amount. The accounting policy on Impairment of Assets is set out in Note 3(v).
The Consolidated Income Statements include the Group’s share of results of the jointly controlled
entities based on the financial statements made up to the financial year end of the Group. The
cumulative post-acquisition movements are adjusted to the carrying amount of the investment.
Unrealised gains on transactions between the Group and its jointly controlled entities are eliminated
to the extent of the Group’s interest in the jointly controlled entities. Unrealised losses are also
eliminated unless the assets transferred are impaired.
In applying the equity method, the Group has ensured that uniform accounting policies of jointly
controlled entities for like transactions and other events in similar circumstances are used. The
equity method is applied based on the latest financial statements made up to the financial year end
of the Group.
(d) Investments
The Group uses its judgement to determine the classification of its investments into current and
non-current. An investment is classified as current if it is readily realisable and it is held for trading
or intended to be realised within 12 months after the balance sheet date. All other investments are
classified as non-current.
Non-current investments are shown at cost and an allowance for diminution in value is made where,
in the opinion of the Directors, there is a decline other than temporary in the value of such
investments. Where there has been a decline other than temporary in the value of an investment,
such a decline is recognised as an expense in the period in which the decline is identified.
Quoted and unquoted current investments are carried at the lower of cost and market value,
determined on an aggregate portfolio basis by category of investments. Cost is derived at on the
weighted average basis whilst market value is calculated by reference to stock exchange quoted
selling prices at the close of business on the balance sheet date. Increases/decreases in the carrying
amount of current investments are credited/charged to the Consolidated Income Statements.
On disposal of an investment, the difference between net disposal proceeds and its carrying amount
is credited/charged to the income statement.

(e) Property, plant and equipment

Property, plant and equipment are tangible items that:
I. are held for use in the production or supply of goods or services, or for administrative
purposes; and
II. are expected to be used during more than one period.
(i) Cost
Property, plant and equipment are initially stated at cost. Cost includes expenditure that is
directly attributable to the acquisition of the items and bringing them to the location and
condition so as to render them operational in the manner intended by the Group. The Group
allocates the initial cost of an item of property, plant and equipment to its significant
component parts.
A piece of freehold land held by the Group is stated at the Directors’ valuation based on a 1983
independent professional valuation of the open market value of the land on an existing
use basis. The surplus arising on revaluation was credited directly to capital reserves and
subsequently utilised.
The Group has adopted the transitional provision of FRS 116 which allows the freehold land
to be stated at the amount revalued on 5 September 1983. All other land held by the Group is
stated at cost.
Subsequent costs are included in the asset’s carrying amount or recognised as a separate asset,
as appropriate, only when it is probable that future economic benefits associated with the
item will flow to the Group and the cost of the item can be measured reliably. The carrying
amount of the replaced part is derecognised. All other repairs and maintenance are charged to
the income statement during the financial period in which they are incurred.
(ii) Depreciation
Freehold land is not depreciated as it has an infinite life. Depreciation of other property, plant
and equipment is provided for on a straight line basis to write off the cost or valuation of each
asset to its residual value over their estimated useful lives. The assets’ residual values, useful
lives and depreciation method are reviewed annually and revised if appropriate.
The principal estimated useful lives of depreciation used are as follows:
Buildings 15-50 years

Plant and machinery 5-15 years
Office equipment, furniture, fittings and vehicles 2-8 years
200
(e) Property, plant and equipment (continued)

(ii) Depreciation (continued)
Dies and jigs, which are included under plant and machinery, are depreciated based on the unit
of production basis.
Work-in-progress is not depreciated. Upon completion, the related costs will be transferred
to the respective categories of assets. Depreciation on work-in-progress commences when the
assets are ready for their intended use.
(iii) Impairment
Where an indication of impairment exists, the carrying amount of the assets is assessed and
written down immediately to its recoverable amount. The accounting policy on Impairment of
Assets is set out in Note 3(v).
(iv) Gains or losses on disposals
Gains or losses on disposals are determined by comparing proceeds with their related carrying
amounts and are included in profit/(loss) from operations.
(v) Repairs and maintenance
Repairs and maintenance are charged to the Consolidated Income Statements during the
period in which they are incurred. The cost of major renovations are included in the carrying
amount of the asset when it is probable that future economic benefits in excess of the originally
assessed standard of performance of the existing asset will flow to the Group. Major renovations
are depreciated over the remaining useful life of the related asset.
(f) Intangible assets

(i) Goodwill
Goodwill is carried at cost less accumulated impairment losses. Goodwill is tested for
impairment at least annually, or when events or circumstances occur indicating that an
impairment may exist. Impairment of goodwill is charged to the Consolidated Income
Statements as and when it arises. Impairment losses on goodwill are not reversed. Gains or
losses on the disposal of an entity includes the carrying amount of goodwill relating to the
entity disposed.
Goodwill is allocated to cash-generating units for the purpose of impairment testing. Each
cash-generating unit or a group of cash-generating units represents the lowest level within
the Group at which goodwill is monitored for internal management purposes and which are
expected to benefit from the synergies of the combination. The Group allocates goodwill to
each business segment in each country in which it operates.

(f) Intangible assets (continued)
(i) Goodwill (continued)
Goodwill on acquisition of associated companies and jointly controlled entities are included in
the carrying value of the investment in associated companies and jointly controlled entities
respectively. Such goodwill are tested for impairment as part of the overall balance.
(ii) Computer software
Acquired computer software licenses are capitalised on the basis of the costs incurred to acquire
and bring to use the specific computer software. These costs are amortised over their
estimated useful lives of 3 to 5 years.
Costs associated with developing or maintaining computer software programmes are

recognised as an expense when incurred. Costs that are directly associated with identifiable
and unique software products controlled by the Group, and that will probably generate
economic benefits exceeding costs beyond one year, are recognised as intangible assets. Costs
include employee costs incurred as a result of developing software and an appropriate portion
of relevant overheads. Computer software development costs recognised as assets are amortised
using the straight line method over their estimated useful lives, not exceeding a period of
3 years.
(iii) Capitalised development cost
Research expenditure is recognised as an expense when incurred. Costs incurred on

development projects (relating to the design and testing of new or improved products) are
recognised as intangible assets when the criteria for recognition in FRS 138 are fulfilled.
Development costs previously recognised as an expense are not recognised as an asset in a

subsequent period. Development expenses capitalised include costs incurred in the
development from the date it first meets the recognition criteria and up to the completion of
the development project and commencement of commercial production. Capitalised
development cost is stated at cost less accumulated amortisation and accumulated impairment
losses, if any. Amortisation is based on the expected production volume over its total useful
life, which does not exceed 7 years for vehicles and 10 years for mechanical parts.
202
(g) Leases
Leases of property, plant and equipment where the Group assume substantially all the benefits and
risks or ownership are classified as finance leases.
Finance leases are capitalised at the inception of the lease at the lower of the fair value of the
leased property, plant and equipment and the present value of the minimum lease payments. Each
lease payment is allocated between the liability and finance charges so as to achieve a periodic
constant rate of interest on the balance outstanding. The corresponding obligations, net of
finance charges, are included in borrowings. The interest element of the finance charge is charged
to the Consolidated Income Statements over the lease period.
Property, plant and equipment acquired under finance leases are included in tangible property,
plant and equipment and are depreciated in accordance with the Note 3(e) above.
(h) Inventories
Inventories are stated at the lower of cost and net realisable value. Cost includes the actual cost
of materials and incidentals in bringing the inventories to their present location and condition, and
is determined either on the first-in first-out basis and weighted average basis depending on the
nature of inventory. Net realisable value represents the estimated selling price less all estimated
costs to completion and costs to be incurred in marketing, selling and distribution. In arriving at net
realisable value, due allowance is made for obsolete, slow moving or defective inventories.
In the case of work-in-progress and finished vehicles, an appropriate proportion of production

overheads is included in the costs.
(i) Trade and other receivables
Trade and other receivables are carried at anticipated net realisable value. Allowances are made for
doubtful debts based on specific reviews of outstanding balances at the balance sheet date. General
allowances are made to cover possible losses, which are not specifically identified. Bad debts
are written off to the Consolidated Income Statements during the financial period in which
they are identified.
(j) Non-current assets classified as assets held for sale

Non-current assets are classified as assets held for sale when the carrying amount is to be recovered
principally through a sale transaction. They are stated at the lower of their carrying amount and
fair value less costs to sell if the carrying amount is to be recovered principally through a sale
transaction rather than through continuing use.

(k) Government grants
Grants from government are recognised at their fair values where there are reasonable assurances
that the grants will be received and the Group will comply with all attached conditions.
Capital grants
Government grants relating to capital expenditure are deferred and recognised in the income
statement over the period necessary to match them with the costs they are intended to
compensate.
Government grants relating to the purchase of plant and equipment are included in non-current
liabilities as capital grant and are credited to the income statement on a straight line basis
over the expected lives of the related assets.
Income grants
Income grants are grants other than capital grants and recognised in the income statement where
there is a reasonable assurance that the grant will be received and the Group will comply with all
attached conditions.
(l) Provisions
Provisions are recognised when the Group has a present legal or constructive obligation as a result
of past events, when it is probable that an outflow of resources will be required to settle the
obligation, and when a reliable estimate of the amount can be made. Where the Group expects
a provision to be reimbursed, the reimbursement is recognised as a separate asset but only when
the reimbursement is virtually certain. Provisions are reviewed at each balance sheet date and
adjusted to reflect the current best estimate. When the effect of the time value of money is material,
the amount of provision is the present value of the expenditure expected to be required to settle
the obligation. Provisions are not recognised for future operating losses.
(i) Warranties
Provision is recognised for the estimated liability on all products under warranty in addition to
claims already received and verified. Warranties are provided for a period of between one
to three years for vehicles sold. The provision is based on experienced levels of claims arising
during the period of warranty. When the Group expects warranties to be reimbursed from
suppliers, the reimbursement is recognised as a separate asset but only when the
reimbursement is virtually certain.
204
(l) Provisions (continued)

(ii) Onerous contracts
The Group recognises a provision for onerous contracts when the expected benefits to
be derived from a contract are less than the unavoidable costs of meeting the obligations
under the contract or estimated costs of exiting the contract.
(m) Employee benefits

(i) Short term employee benefits
Salaries, wages, paid annual leave and sick leave, bonuses and non-monetary benefits are
accrued in the period in which the associated services are rendered by employees of the
Group.
(ii) Post employment benefits
The Group has various post employment benefit schemes in accordance with the local
conditions and practices in the countries in which it operates. The Group has both defined
contribution and defined benefit plans.
Defined contribution plans
The Group’s contributions to defined contribution plans are charged to the Consolidated
Income Statements in the period to which they relate. Once the contributions have been
paid, the Group has no further payment obligations.
Defined benefit plan
The liability in respect of a defined benefit plan is the present value of the defined benefit
obligation at the balance sheet date minus the fair value of plan assets, together with
adjustments for actuarial gains/losses and past service cost. The Group determines the
present value of the defined benefit obligation and the fair value of any plan assets with
sufficient regularity such that the amounts recognised in the financial statements do not
differ materially from the amounts that would be determined at the balance sheet date.
The defined benefit obligation, calculated using the projected unit credit method, is
determined by independent actuaries on the basis of full triennial valuations and updated
annually. Assumptions were made in relation to the annual investment returns, annual
salary increases and annual increases in pension payments.
Plan assets in excess of the defined benefit obligation are subject to the asset limitation
test specified in FRS 119.

(m) Employee benefits (continued)

(ii) Post employment benefits (continued)
Defined benefit plan (continued)
Actuarial gains and losses arise from experience adjustments and changes in actuarial
assumptions. The amount of net actuarial gains and losses recognised in the Consolidated
Income Statements is determined by the corridor method in accordance with FRS 119
and is charged or credited to Consolidated Income Statements over the average remaining
service lives of the related employees participating in the defined benefit plan.
(iii) Termination benefits
Termination benefits are payable whenever an employee’s employment is terminated

before the normal retirement date or whenever an employee accepts voluntary redundancy
in exchange for these benefits. The Group recognises termination benefits when it
is demonstrably committed to either terminate the employment of current employees
according to a detailed formal plan without possibility of withdrawal or to provide
termination benefits as a result of an offer made to encourage voluntary redundancy.
Benefits falling due more than 12 months after balance sheet date are discounted to
present value.
(n) Income taxes

Current tax expense is determined according to the tax laws of each jurisdiction in which the Group
operates and include all taxes based upon the taxable profits, including withholding taxes payable
by a foreign subsidiary company on distributions of retained earnings.
Deferred tax is recognised in full, using the liability method, on temporary differences arising
between the amounts attributed to assets and liabilities for tax purposes and their carrying amounts
in the financial statements.
Deferred tax assets are recognised to the extent that it is probable that taxable profit will be
available against which the deductible temporary differences or unused tax losses can be utilised.
Deferred tax is recognised on temporary differences arising on investments in subsidiary companies,

associated companies and jointly controlled entities except where the timing of the reversal of the
temporary difference can be controlled and it is probable that the temporary difference will not
reverse in the foreseeable future.
206
(n) Income taxes (continued)

Deferred tax assets and liabilities are not recognised on temporary differences arising from:
(i) goodwill; or
(ii) from the initial recognition of an asset or liability in a transaction which is not a business
combination and at time of the transaction, affects neither accounting profit nor taxable
profit.
Deferred tax is determined using tax rates (and tax laws) that have been enacted or substantially
enacted by the balance sheet date and are expected to apply when the related deferred tax
asset is realised or the deferred tax liability is settled.
(o) Foreign currency transactions and translation

(i) Functional and presentation currency
Items included in the financial statements of each of the Group’s entities are measured using
its functional currency, which is the currency of the primary economic environment in which
the entity operates (‘the functional currency’). The Consolidated Financial Statements are
presented in Ringgit Malaysia, which is the Group’s functional and presentation currency.
(ii) Transactions and balances
Foreign currency transactions are translated into the functional currency using the exchange
rates prevailing at the dates of the transactions. Foreign exchange gains and losses resulting
from the settlement of such transactions and from the translation at year-end exchange rates
of monetary assets and liabilities denominated in foreign currencies are recognised in the
Consolidated Income Statements.
(iii) Group companies
The results and financial position of all the Group companies (none of which has the currency
of a hyperinflationary economy) that have a functional currency different from the presentation
currency are translated into the presentation currency as follows:
- assets and liabilities for each balance sheet presented are translated at the closing rate at
the date of that balance sheet;
- income and expenses for each income statement are translated at average exchange rates
(unless this average is not a reasonable approximation of the cumulative effect of the
rates prevailing on the transaction dates, in which case income and expenses are translated
at the dates of the transactions); and
- all resulting exchange differences are recognised as a separate component of equity.

(o) Foreign currency transactions and translation (continued)

(iii) Group companies (continued)
On consolidation, exchange differences arising from the translation of the net investment in
foreign operations are taken to shareholders’ equity. Net investment in foreign operations is
defined as the amount of the reporting entity’s interest in the net assets of that operation,
which includes advances that are assessed as long term in nature. When a foreign operation
is disposed of or sold, such exchange differences that were recorded in equity are recognised
in the Consolidated Income Statements as part of the gain or loss on disposal.
(iv) Closing rates

The principal closing rates (units of Malaysian Ringgit per foreign currency) used in translating
significant balances at financial year end are as follows:
Foreign currency 31 March 2009 31 March 2008
US Dollar 3.6595 3.1985

Sterling Pound 5.2225 6.3850
Indonesian Rupiah (100) 0.0313 0.0343
Singapore Dollar 2.4048 2.3147
Thai Baht 0.1029 0.1017
Australian Dollar 2.4935 2.9270
(p) Cash and cash equivalents

For the purpose of the cash flow statement, cash and cash equivalents comprise cash on hand,
deposits held at call with banks, other short term, highly liquid investments with original maturities
of not more than twelve months and bank overdrafts. Bank overdrafts are included within
borrowings in current liabilities on the balance sheet.
(q) Income recognition

Revenue from sales of vehicles, spare parts and accessories are recognised when significant risks and
rewards have been transferred to buyers. Significant risks and benefits are generally deemed to
have been transferred upon delivery or acceptance of the goods.
Revenue from sale of completed apartments is recognised when the Sale and Purchase Agreements
are signed.
208
(q) Income recognition (continued)

Revenue from rendering of engineering services on long term engineering contracts is recognised
on the basis of the stage of completion of such contracts at the financial year end, where the
contractual outcome can be assessed with reasonable certainty. Full provision is made for all
foreseeable losses on contracts entered into or commenced prior to the financial year end.
Amounts are included within receivables and payables to recognise timing differences arising
between amounts invoiced and amounts recognised in the income statement on individual
engineering contracts.
Other revenue comprises mainly revenue from rental and royalties, which are recognised on an
accrual basis. Interest income is recognised on proportionate basis that reflects the effective yield
on the asset. Scrap sales and gains on disposal of investments are recognised on an accrual basis.
Sale of rights for the use of intellectual property rights are recognised on an accrual basis in
accordance with the substance of the relevant agreements.
Dividends are recognised when the Company’s right to receive payment is established.
(r) Financial instruments

(i) Description
A financial instrument is any contract that gives rise to both a financial asset of one enterprise
and a financial liability or equity instrument of another enterprise.
A financial asset is any asset that is cash, a contractual right to receive cash or another financial
asset from another enterprise, a contractual right to exchange financial instruments with
another enterprise under conditions that are potentially favourable, or an equity instrument
of another enterprise.
A financial liability is any liability that is a contractual obligation to deliver cash or another
financial asset to another enterprise, or to exchange financial instruments with another
enterprise under conditions that are potentially unfavourable.
(ii) Financial instruments recognised on the balance sheet
The particular recognition method adopted for financial instruments recognised on the Balance
Sheet is disclosed in the individual policy statements associated with each item.
(iii) Financial instruments not recognised on the balance sheet
The Group enters into foreign currency forward contracts to protect the Group from movements
in exchange rates by establishing the rate at which a foreign currency asset or liability will be
settled.
Exchange gains and losses arising on contracts entered into as hedges of anticipated future
transactions are deferred until the settlement of the related forward contracts.

(r) Financial instruments (continued)

(iv) Fair value estimation for disclosure purposes
The fair value of publicly traded derivatives and securities is based on quoted market prices at
the balance sheet date.
The fair value of forward foreign exchange contracts is determined using forward foreign
exchange market rates at the balance sheet date.
In assessing the fair value of non-traded derivatives and financial instruments, the Group uses
a variety of methods and makes assumptions that are based on market conditions existing at
each balance sheet date. Unquoted investments are valued based on quoted investments
with similar features.
The fair value of financial liabilities with a maturity of more than one year is estimated by
discounting the future contractual cash flows at this current market interest rate available to
the Group for similar financial instruments.
The face values, less any estimated credit adjustments, for financial assets and liabilities
classified as current are assumed to approximate their fair values.
(s) Borrowings
Borrowings are initially recognised based on the proceeds received, net of transaction costs
incurred. Subsequently, borrowings are stated at amortised cost using the effective yield method;
any difference between proceeds (net of transaction costs) and the redemption value is recognised
in the income statement over the period of the borrowings.
Borrowing costs are charged to the Consolidated Income Statements as an expense in the period in
which they have accrued.
Borrowings are classified as current liabilities unless the Group has the unconditional right to defer
settlement of the liability for at least 12 months after the balance sheet date.
(t) Share capital

Ordinary shares are classified as equity. External costs directly attributable to the issue of new shares
are expensed off in the Consolidated Income Statements.
Dividends on ordinary shares are recognised as liabilities when proposed or declared before the
balance sheet date. A dividend proposed or declared after the balance sheet date, but before the
financial statements are authorised for issue, is not recognised as a liability at the balance sheet
date. Upon the dividend becoming payable, it will be accounted for as liability.
210
(u) Contingent liabilities and contingent assets

The Group and Company do not recognise a contingent liability but discloses its existence in the
financial statements. A contingent liability is a possible obligation that arises from past events
whose existence will be confirmed by uncertain future events beyond the control of the Group or
a present obligation that is not recognised because it is not probable that an outflow of resources
will be required to settle the obligation. A contingent liability also arises in the extremely rare
circumstance where there is a liability that cannot be recognised because it cannot be measured
reliably.
A contingent asset is a possible asset that arises from past events whose existence will be
confirmed by uncertain future events beyond the control of the Group. The Group does not
recognise contingent assets but discloses its existence where inflows of economic benefits are
probable, but not virtually certain.
In the acquisition of subsidiary companies by the Group under a business combination, the
contingent liabilities assumed are measured initially at their fair values at the acquisition date,
irrespective of the extent of any minority interests.
The Group recognises separately the contingent liabilities of the acquirees as part of allocating
the cost of a business combination where their fair values can be measured reliably. Where the fair
values cannot be measured reliably, the resulting effect will be reflected in the goodwill arising
from the acquisition.
Subsequent to the initial recognition, the Group measures the contingent liabilities that are
recognised separately at the date of acquisition at the higher of the amount that would be
recognised in accordance with the provisions of FRS 137 and the amount initially recognised less,
when appropriate, cumulative amortisation recognised in accordance with FRS 118.
(v) Impairment of assets

Assets that have an indefinite useful life are not subject to amortisation and are tested annually
for impairment, or whenever events or circumstances occur indicating that an impairment may exist.
Property, plant and equipment and other non-current assets, including intangible assets, are
reviewed for impairment losses whenever events or changes in circumstances indicate that the
carrying amount may not be recoverable. Impairment loss is recognised for the amount by which
the carrying amount of the asset exceeds its recoverable amount. The recoverable amount is
measured at the higher of the fair value less cost to sell of an asset and its value-in-use. The value-
in-use is the net present value of the projected future cash flows derived from that asset discounted
at the appropriate discount rate. Assets other than goodwill that suffered an impairment are
reviewed for possible reversal at each reporting date.
The projected cash flows are based on the Group’s estimates calculated based on historical, industry
trend, general market, economic conditions and other available information. For the purposes of
assessing impairment, assets are grouped at the lowest level for which there is separately identifiable
cash flows.

(v) Impairment of assets (continued)

The impairment loss is charged to the Consolidated Income Statements. Any subsequent increase
in recoverable amount is recognised in the Consolidated Income Statements.
Irrespective of whether there is any indication of impairment, the Group shall test an intangible
asset with an indefinite useful life or an intangible asset not yet available for use for impairment
annually by comparing its carrying amount with its recoverable amount. This impairment test may
be performed at any time during an annual period; it is performed at the same time every year.
Different intangible assets may be tested for impairment at different times. However, if such an
intangible asset was initially recognised during the current annual period, that intangible asset
shall be tested for impairment before the end of the current annual period.
4 KEY ESTIMATES AND JUDGEMENTS

Estimates and judgements are continually evaluated and are based on historical experience and
other factors, including expectations of future events that are believed to be reasonable under the
circumstances.
The Group makes estimates and assumptions concerning the future. The resulting accounting
estimates will, by definition, rarely equal the related actual results. To enhance the information
content of the estimates, certain key variables that are anticipated to have a material impact on the
Group’s results and financial position are tested for sensitivity to changes in the underlying
parameters. The estimates and assumptions that have a significant risk of causing a material
adjustment to the carrying amounts of assets and liabilities within the next financial year are
mentioned below.
(i) Carrying value of property, plant and equipment and capitalised development cost
The Group assesses the carrying amount of property, plant and equipment and capitalised
development cost whenever the events or changes in circumstances indicate that the carrying
amount of an asset may not be recoverable i.e. the carrying amount of the asset is more than
the recoverable amount. Recoverable amount is measured at the higher of the fair value less
cost to sell for that asset and its value-in-use. The value-in-use is the net present value of the
projected future cash flows derived from the asset discounted at an appropriate discount
rate.
Projected future cash flows are based on the Group’s estimates calculated based on historical,
sector and industry trends, general and Malaysian market and economic conditions, changes
in technology and other available information regarding the automotive sector.
The assumptions used, results and conclusion of the impairment assessment are stated in Note
13 to the financial statements.
212
4 KEY ESTIMATES AND JUDGEMENTS (CONTINUED)
(ii) Estimated useful lives of dies and jigs and capitalised development cost
The Group reviews annually the estimated production units used for assessing the estimated useful
lives of dies and jigs and capitalised development cost based on factors incorporated in business plans
and strategies such as the expected level of demand and usage and future technological
developments.
Future results of operations could be materially affected by changes in these estimates brought
about by changes in the factors mentioned. A reduction in the estimated production units for
assessing the carrying values of dies and jigs and capitalised development cost would increase the
recorded depreciation and amortisation respectively.
(iii) Deferred tax assets
Deferred tax assets are recognised to the extent that it is probable that future taxable profits
will be available against which the temporary differences can be utilised. This involves significant
judgements regarding the future financial performance of the Group, the likely timing and level
of future taxable profits together with future tax planning strategies to support the basis of
recognition of deferred tax assets. An analysis of the deferred tax balance is set out in Note 22
to the financial statements.
The Directors have considered the ability of the Group to generate sufficient taxable income
to utilise the deferred tax assets and have concluded that no deferred tax asset should be
recognised for certain subsidiary companies as at 31 March 2009.
(iv) Estimation of income taxes payable and recoverable
Income taxes are estimated based on the rules governed under the Income Tax Act, 1967.
Significant judgement is required in determining the capital allowances and deductibility of
certain expenses during the estimation of the provision for income taxes. There are many
transactions and calculations for which the ultimate tax determination is uncertain during the
ordinary course of business.
Where the final tax outcome of these matters is different from the amounts that were
initially recognised, such differences will impact the income tax provisions in the period in
which such determination is made. The status of the income tax position of the Group is stated
in Note 10 to the financial statements.
(v) Provisions for warranty
Provision is made for the estimated liability on all products under warranty in addition to claims
already received. The accrual recorded is based on the actual claims experienced by the Group
arising during the period of warranty over a number of years which provides a basis for
calculating expected warranty claims. In addition, the Group records an asset for the amount
expected to be recoverable from its vendors based on similar actual reimbursement experienced
by the Group.
An analysis of the utilisation of the provision is stated in Note 34 to the financial statements.

4 KEY ESTIMATES AND JUDGEMENTS (CONTINUED)
(vi) Allowance for inventory write down
Allowance for inventory write down is made based on an analysis of the ageing profile and
expected sales patterns of individual items held in inventory. This requires an analysis of
inventory usage based on expected future sales transactions taking into account current market
prices, useful lives of vehicle models and expected cost to sell. Changes in the inventory ageing
and expected usage profiles can have an impact on the allowance recorded.
(vii) Allowance for receivables
The allowance is established when there is objective evidence that the Group will not be able
to collect all amounts due according to the original terms of receivables. This is determined
based on the ageing profile, expected collection patterns of individual receivable balances,
credit quality and credit losses incurred. Management carefully monitors the credit quality of
receivable balances and makes estimates about the amount of credit losses that have been
incurred at each financial statement reporting date. Any changes to the ageing profile,
collection patterns, credit quality and credit losses can have an impact on the allowance
recorded.
(viii) Impairment of goodwill
The Group tests goodwill for impairment at least annually in accordance with its accounting
policy or whenever events or changes in circumstances indicate that this is necessary. The
assumptions used, results and conclusion of the impairment assessment are stated in Note 15
to the financial statements.
5 SIGNIFICANT EVENTS DURING THE FINANCIAL YEAR
During the financial year,
(a) As reported in the prior financial year,
(i) CIMB Investment Bank Berhad on behalf of Directors announced on 31 March 2008, a
proposal to strike-off and liquidate eight dormant companies with the intention to reduce
cost, streamline and align business operations within the Group. The proposal was
completed during the financial year.
(ii) The internal reorganisation exercise to rationalise the operations of Marco Acquisition
Corporation, USA (‘Marco’), a wholly owned subsidiary company of the Company held through
Proton Engineering Research Technology Sdn. Bhd. had been completed on 12 September
2008 following the merger and dissolution of Marco into Lotus Holdings Inc., USA.
(b) Proton Cars Benelux Limited (‘Benelux’), a 99% owned subsidiary company of Proton Marketing
Sdn. Bhd. (‘PMSB’) was placed under Members’ Voluntary Liquidation on 2 February 2009.
Benelux had not commenced operations since incorporation.
214
5 SIGNIFICANT EVENTS DURING THE FINANCIAL YEAR (CONTINUED)

(c) Proton Edar Ventures Sdn. Bhd. and Proton Edar Resources Sdn. Bhd., wholly owned subsidiary
companies of Proton Edar Sdn. Bhd. which is in turn a wholly owned subsidiary of PMSB and
Proton Capital Sdn. Bhd., a wholly owned subsidiary company of the Company were placed under
Members’ Voluntary Liquidation on 6 March 2009.
6 REVENUE
Revenue at the Group represents the invoiced value of goods sold and engineering services provided and
is presented net of taxes, discounts and commission paid to dealers.
Revenue at the Company represents income from shares held in subsidiary companies and associated
companies.
Revenue comprises:
Group Company
2009 2008 2009 2008
RM’000 RM’000 RM’000 RM’000
Sale of vehicles, spare parts 6,220,872 5,361,826 - -

and accessories
Rendering of engineering services 235,667 219,386 - -
Others 30,031 40,382 - -
Gross dividend income - - 362,357 41,203
6,486,570 5,621,594 362,357 41,203
Included in others is sale of rights for the use of intellectual property rights to an export market amounting
to RM19,612,000 (2008: RM33,515,000).

7 (LOSS)/PROFIT BEFORE FINANCE COST

Group Company
2009 2008 2009 2008
RM’000 RM’000 RM’000 RM’000
The following items have been charged/

(credited) in arriving at (loss)/profit
before finance cost:
Gross dividends receivable from:
- subsidiary company, unquoted - - (359,000) (40,000)
- associated companies, unquoted - - (3,357) (786)
- others, quoted (1,260) (2,479) - -
- others, unquoted - (417) - (417)
Research and development grant (80,656) (193,782) - -
Property, plant and equipment:
- depreciation 450,346 382,556 - -
- write off 38,746 18,557 - -
- impairment 257,674 - - -
- reversal of impairment (1,616) (800) - -
- loss/(gain) on disposal 19,417 (12,546) - -
Prepaid land lease payments:
- amortisation - 89 - -
- gain on disposal - (990) - -
Impairment of goodwill - 6,741 - -
Impairment of investment
in an associated company 6,678 4,200 - -
Intangible assets:
- amortisation 48,493 34,817 - -
- impairment 20,802 - - -
Write down/(write back) of inventories** 114,950 (25,053) - -
Current investment:
- loss/(gain) on disposal 44 (1,678) - -
- write down in market value 1,084 - - -
Research and development expenditure 45,127 37,447 - -
Provision for warranties (Note 34) 62,862 45,526 - -
Reversal of allowance for doubtful debts (63,315) (19,708) - -
Allowance for doubtful debts 45,616 7,737 - -
Statutory audit fees to:
PricewaterhouseCoopers Malaysia:
- current year 599 569 88 84
- under/(over) provision in prior year 114 (57) 60 60
Other member firms of
PricewaterhouseCoopers International
Limited*:
- current year 1,380 1,394 - -
- under provision in prior year 206 - - -
216
7 (LOSS)/PROFIT BEFORE FINANCE COST (CONTINUED)

Group Company
2009 2008 2009 2008
RM’000 RM’000 RM’000 RM’000
Audit related fees to PricewaterhouseCoopers

- Malaysia 505 560 - -
Non-audit fees to PricewaterhouseCoopers:
- Malaysia 902 1,234 - -
- Other member firms of PricewaterhouseCoopers
International Limited* 959 1,961 - -
Provision for onerous contract 4,426 - - -
Rental of plant, machinery and equipment 1,765 50 - -
Rental of land and buildings 16,725 14,789 - -
Foreign exchange loss/(gain):
- transactions (7,481) 7,276 - -
- translation (8,284) (10,230) - -
Rental income on land and buildings (1,925) (3,891) - -
Interest income (42,089) (32,143) (4,618) (301)
Automotive Development Fund
- amortisation of capital grant (21,646) - - -
* PricewaterhouseCoopers Malaysia and other member firms of PricewaterhouseCoopers

International Limited are separate and independent legal entities.
** Cost of sales includes inventories written down amounting to RM114,950,000 of which

RM81,841,000 relates to the vehicle models which were impacted by contraction in sales volume
as disclosed in Note 13 to the financial statements (2008: write back of RM25,053,000).

8 STAFF COST
Group
2009 2008
RM’000 RM’000
Wages, salaries and bonuses 598,390 527,185

Pension cost
- defined contribution plan 55,228 49,762
- defined benefit plan (Note 32(e)) (8,042) 14,616
Other employee benefits 62,842 43,099
Termination benefits - 22
708,418 634,684
Directors’ remuneration
he aggregate amount of emoluments receivable by the Directors of the Group and Company during the
T
financial year was as follows:
Group Company
2009 2008 2009 2008
RM’000 RM’000 RM’000 RM’000
Non-Executive Directors:
- allowances 584 505 424 389
- fees 939 948 217 291
- estimated monetary value
of benefits-in-kind 59 39 59 39
Executive Director*:
- salaries and bonuses 705 540 705 540
- defined contribution plan 109 86 109 86
- estimated monetary value
of benefits-in-kind 81 65 81 65
- fees - - 42 42
- allowances - - 16 12

2,477 2,183 1,653 1,464
* The Executive Director’s remuneration in the Company is fully recharged to a subsidiary company.
218
9 FINANCE COST
Group
2009 2008
RM’000 RM’000
Interest expense on:

Long term loans 6,957 7,750
Short term borrowings 6,110 9,405
Others 1,341 781
14,408 17,936
10 TAXATION
Group Company
2009 2008 2009 2008
RM’000 RM’000 RM’000 RM’000
Taxation in Malaysia
Current taxation:
- charge for the financial year 28,027 7,020 1,179 10,517
- over accrual in respect
of prior financial years (49,456) (45,859) - -
(21,429) (38,839) 1,179 10,517
Taxation outside Malaysia
Current taxation:
- charge for the financial year 801 885 - -
- over accrual in respect of prior
financial years (844) (1,527) - -
(43) (642) - -
Deferred taxation (Note 22)
Origination and reversal of

temporary differences (1,409) (754) - -
Tax benefits arising from previously
unrecognised temporary differences 5,486 - - -
4,077 (754) - -
(17,395) (40,235) 1,179 10,517

10 TAXATION (CONTINUED)
A numerical reconciliation between the average effective tax rate and the statutory tax rate effect is as
follows:
Group Company
2009 2008 2009 2008
% % % %
Malaysian statutory tax rate (25) 26 25 26
Tax effects of:

- double deduction and
incentive on qualifying expenditure (3) (1) - -
- expenses not deductible for tax purposes 1 15 - -
- income not subject to tax (11) (51) (25) -
- current year tax losses not recognised 6 4 - -
- current year deductible temporary
differences not recognised 50 22 - -
- over accrual in respect
of prior years (16) (32) - -
- recognition of previously unrecognised
deductible temporary differences (2) (8) - -
- recognition of previously unrecognised
tax losses (4) - - -
- different tax rates in subsidiary
companies outside Malaysia (1) (3) - -

Average effective tax rate (5) (28) - 26
2009 2008 2009 2008

RM’000 RM’000 RM’000 RM’000
Previously unrecognised temporary

differences utilised during the financial year 19,640 - - -
Tax savings arising from temporary differences 5,486 - - -

Previously unrecognised tax losses
utilised during the financial year 45,068 5,369 - -
Tax savings arising from such tax losses 11,267 1,396 - -
Unabsorbed capital allowances

carried forward 1,964,254 1,553,523 - -
Unutilised tax losses carried forward 566,932 601,584 - -
Unutilised reinvestment allowances 1,993,363 1,790,117 - -
220
10 TAXATION (CONTINUED)
The tax write back during the financial year arose following an agreement with the Inland Revenue
Board (‘IRB’) to settle tax disputes in respect of a subsidiary company’s treatment of certain items in the
tax submissions for Years of Assessment (‘YA’) 1989 to 1998. The basis of agreed claims was subsequently
applied for YA 1999 to 2002.
The tax write back in the previous financial year relates mainly to the settlement of disputes of a subsidiary
company with the IRB in relation to Section 127 relief on the differences in the interpretation of the
qualifying period for investment tax credit. The relief was claimed for YA 1992.
The tax recoverable amount of RM140,960,000 (2008: RM82,452,000) relates to settlement of tax disputes
for YA 1989 to 2002 while the amount of RM19,650,000 (2008: RM32,027,000) relates to overpayment of
tax liabilities for YA 2007 and 2008.
11 (LOSS)/EARNINGS PER SHARE

Basic (loss)/earnings per share is calculated by dividing the net (loss)/profit attributable to equity holders of
the Company by the weighted average number of ordinary shares in issue during the financial year.
Group
2009 2008
Net (loss)/profit attributable to equity holders

of the Company (RM’000) (301,806) 184,551
Weighted average number of ordinary shares in issue (‘000) 549,213 549,213
Basic (loss)/earnings per share (sen) (55) 34
Diluted (loss)/earnings per share equals to basic (loss)/earnings per share.
12 DIVIDENDS
Dividends declared in respect of the financial year ended 31 March 2009 are as follows:
Group
2009 2008
RM’000 RM’000
Interim dividend of 5.0 sen per ordinary share less tax at 25% 20,595 -
The Directors do not recommend the payment of a final dividend for the financial year ended 31 March
2009.

13 PROPERTY, PLANT AND EQUIPMENT
Office
equipment,
furniture,
Freehold Plant and fittings and Work-in-
land Buildings machinery vehicles progress Total
Group Note RM’000 RM’000 RM’000 RM’000 RM’000 RM’000
2009
Cost/valuation
At 1 April 2008 236,362 1,396,863 4,375,404 1,074,479 27,858 7,110,966

Currency translation
differences (2,611) (35,192) (45,094) (30,946) (88) (113,931)
Additions 759 2,457 22,629 85,685 351,251 462,781
Disposals (7,638) - (43,136) (20,848) (10,560) (82,182)
Acquisition through
business combination 17(a) - 2,794 420 26 - 3,240
Written off - (3,778) (38,668) (10,053) (19,212) (71,711)
Reclassification
of completed
work-in-progress - 1,256 312,680 39,073 (353,009) -
Reclassification from
inventory - - - - 9,124 9,124
Reclassification to
non-current assets
held for sale 29 - (11,918) (4,407) - - (16,325)
At 31 March 2009 226,872 1,352,482 4,579,828 1,137,416 5,364 7,301,962
222
13 PROPERTY, PLANT AND EQUIPMENT (CONTINUED)
Office
equipment,
furniture,
2009
Accumulated depreciation
At 1 April 2008 - 434,149 2,558,858 682,161 - 3,675,168

differences - (7,849) (28,592) (14,004) - (50,445)
Charge for the
financial year - 52,647 306,075 91,624 - 450,346
Disposals - - (19,571) (14,121) - (33,692)
Acquisition through
business combination 17(a) - 1,298 102 26 - 1,426
Written off - - (23,004) (9,961) - (32,965)
Reclassification to
non-current assets
held for sale 29 - (2,569) (28) - - (2,597)
At 31 March 2009 - 477,676 2,793,840 735,725 - 4,007,241
2009
Accumulated
impairment losses
At 1 April 2008 13,536 137,365 79,632 54,819 - 285,352

differences (13,536) (24,034) (18,759) (17,471) - (73,800)
Charge for the - - 257,674 - - 257,674
financial year
Reversal of
impairment loss - (502) (786) (328) - (1,616)
At 31 March 2009 - 112,829 317,761 37,020 - 467,610
Net book value

At 31 March 2009 226,872 761,977 1,468,227 364,671 5,364 2,827,111

Office
equipment,
furniture,
2008
Cost/valuation
At 1 April 2007 262,072 1,331,521 4,141,014 1,090,675 188,524 7,013,806

differences (1,118) (12,189) (17,329) (9,719) (54) (40,409)
Additions 261 1,011 18,802 46,073 325,850 391,997
Disposals (24,853) (583) (16,768) (24,899) (6,230) (73,333)
Acquisition through
business combination 17(b) - 12,756 36,493 60 - 49,309
Written off - (376) (105,598) (97,748) (17,558) (221,280)
Reclassification
of completed
work-in-progress - 64,723 318,790 70,037 (453,550) -
Reclassification to inventory - - - - (9,124) (9,124)
At 31 March 2008 236,362 1,396,863 4,375,404 1,074,479 27,858 7,110,966
224
Office
equipment,
furniture,
2008
Accumulated depreciation
At 1 April 2007 - 385,327 2,443,469 711,283 - 3,540,079

differences - (4,566) (10,286) (3,655) - (18,507)
Charge for the
financial year - 52,728 239,917 89,911 - 382,556
Disposals - (387) (16,768) (18,002) - (35,157)
Acquisition through
business combination 17(b) - 1,423 7,449 48 - 8,920
Written off - (376) (104,923) (97,424) - (202,723)
At 31 March 2008 - 434,149 2,558,858 682,161 - 3,675,168
2008
Accumulated
impairment losses
At 1 April 2007 14,591 146,017 84,586 59,038 - 304,232

differences (1,055) (8,652) (4,954) (3,419) - (18,080)
Reversal of
impairment loss - - - (800) - (800)
At 31 March 2008 13,536 137,365 79,632 54,819 - 285,352
Net book value

At 31 March 2008 222,826 825,349 1,736,914 337,499 27,858 3,150,446


A piece of a subsidiary company’s freehold land was revalued on 5 September 1983 based on an independent
professional valuation. The surplus of RM36,882,000 arising from the revaluation was credited to the
capital reserves and subsequently utilised. Had this freehold land been carried at historical cost, the net
book value of freehold land that would have been included in the financial statements at the end of the
financial year would be RM22,448,000 (2008: RM22,448,000).
Property, plant and equipment of a wholly owned subsidiary company with a net book value of
RM111,777,000 (2008: RM61,857,000) was charged to a licensed bank as security for borrowings as disclosed
in Note 32(b) to the financial statements.
The net book value of the office equipment acquired under finance lease at the balance sheet date was
RM3,959,000 (2008: RM5,480,000).
The land title for a freehold land with net book value of RM20,600,000 (2008: RM20,600,000) has not yet
been transferred to the Group pending subdivision of the master title.
Impairment test for property, plant and equipment and capitalised development cost
The carrying value of property, plant and equipment of a subsidiary company at balance sheet date is
RM2,458,078,000 (2008: RM2,773,719,000).
The softening of the automotive industry in the second half of the financial year has resulted in a
contraction in sales volume. Arising from this, a subsidiary company undertook a test for impairment of its
property, plant and equipment and capitalised development cost.
The projections used for the impairment assessment of property, plant and equipment and capitalised
development cost reflect the Group’s expectation of the usage, revenue growth, operating costs and
margins for each production plant based on past experience and current assessment of market share,
expectation of market and industry growth. The impairment assessment indicated that the carrying values
of property, plant and equipment and capitalised development cost relating to certain vehicle models
impacted by volume contraction may not be recoverable.
As a result, the following impairment of property, plant and equipment and capitalised development cost
were recognised during the financial year:
Group
2009
RM’000
Property, plant and equipment 257,674

Capitalised development cost (Note 16) 20,802
278,476
226
The property, plant and equipment were allocated to the cash-generating units which are identified
according to production plants and vehicle models. An impairment assessment was performed due to
certain vehicle models being impacted by a contraction in sales volume.
(a) Key assumptions used in the value-in-use calculations
The recoverable amounts are determined based on value-in-use calculations. This value-in-use
calculations apply a discounted cash flow model using cash flow projections covering a five year
period, and assuming a zero growth rate for subsequent periods up to fifteen years. The projections
over these periods were based on an approved business plan and reflect the subsidiary company’s
expectation of usage, revenue growth, operating costs and margins based on past experience and
current assessment of market share, expectations of market growth and industry growth.
The sales volumes for the Malaysian market indicate a reduction from current levels as the Group
does not include future new models for which capital expenditure has not been incurred. However,
the total overall cash flow arising from sales volume indicates a significant increase arising from
growth in sales of completely-knocked-down packs to the export markets.
Based on past trends, cashflows arising from government grants are included in the value-in-use
calculations, estimated based on a percentage of projected investment level.
Terminal values of the production plants in year fifteen are assumed to be derived from the fair
market values by an internal registered valuer arising from the disposal of the land and buildings on
which the three specific plants are located. A discount factor of 6.5% was used to discount the
terminal value which reflects the prevailing borrowing cost for land and buildings.
Terminal values of platforms relating to certain vehicle models incorporate the estimated net
realisable value from the disposal of the model platform.
For purposes of the value-in-use calculation, discount rates of 8% and 16% have been applied
to domestic and export sales respectively. The discount rate of 8% reflects the prevailing independent
market rate applicable to the Group.
(b) Impact of possible changes in key assumptions
The sensitivity test indicated that a plant owned by a subsidiary company may require further
impairment should the projected sales volume drop by 6% over the projection period. No further
impairment loss is required where other realistic variations are applied to key assumptions.

14 PREPAID LAND LEASE PAYMENTS

Group
2009 2008
RM’000 RM’000
Cost
At 1 April 24,031 10,989

Currency translation differences (1,347) (1,077)
Acquisition through business combination (Note 17(b)) - 25,108
Disposal - (394)
Reclassification to inventory (Note 23) - (10,595)
Reclassification to non-current assets held for sale (Note 29) (22,684) -
At 31 March - 24,031
Accumulated amortisation
At 1 April - 1,045
Amortisation - 89
Disposal - (80)
Reclassification to inventory (Note 23) - (1,054)
At 31 March - -
Net book value

At 31 March - 24,031

228
15 GOODWILL
Group
2009 2008
RM’000 RM’000
At 1 April 35,749 29,008

Acquisition through business combination (Note 17(b)) - 6,741
35,749 35,749
Less: Accumulated impairment loss (6,741) (6,741)
At 31 March 29,008 29,008
Impairment test for goodwill
The Group undertook an annual test for impairment of goodwill. The carrying amount of goodwill is
allocated to the cash-generating unit that the goodwill relates to, i.e. distribution business in Malaysia.
The recoverable amount of the cash-generating unit including goodwill in this test is determined based
on the value-in-use calculation. This value-in-use calculation applies a discounted cash flow model using
cash flow projections covering a five-year period for the distribution business in Malaysia. The projections
reflect the Group’s expectations of revenue growth, operating costs and margins based on past experience
and current assessment of market share, expectations of market growth and industry growth.
For purposes of the value-in-use calculation, a discount rate of 8% has been applied. The discount rate
reflects the prevailing independent market rate applicable to the Group in Malaysia.
The sales volumes used in the projections indicate an increase from current levels through the introduction
of a new model in a segment for which the Group is not currently in and where capital expenditure has
been incurred to date, over the projection periods. However, the projected sales volume does not include
future new models for which capital expenditure has not been incurred. A nil terminal value has been
assumed.
Sensitivity analysis shows that no impairment loss is required for the carrying amount of goodwill, including
where realistic variations are applied to key assumptions.

16 INTANGIBLE ASSETS
Capitalised
development Computer
cost software Total
Group RM’000 RM’000 RM’000
2009
Cost
At 1 April 2008 275,804 65,133 340,937
Currency translation differences (14,144) - (14,144)
Additions 231,468 6,164 237,632
Written off - (16) (16)
Disposal - (16) (16)
At 31 March 2009 493,128 71,265 564,393
Amortisation
At 1 April 2008 27,739 38,006 65,745
Charge for the financial year 33,945 14,548 48,493
Disposal - (16) (16)
At 31 March 2009 59,401 52,522 111,923
Accumulated impairment loss

At 1 April 2008 - - -
Charge for the financial year (Note 13) 20,802 - 20,802
At 31 March 2009 20,802 - 20,802
Net book value

At 31 March 2009 412,925 18,743 431,668
2008
Cost
At 1 April 2007 142,975 57,797 200,772
Currency translation differences (730) (180) (910)
Additions 133,559 7,658 141,217
At 31 March 2008 275,804 65,133 340,937
Amortisation
At 1 April 2007 11,611 20,086 31,697
Currency translation differences (593) (34) (627)
Charge for the financial year 16,721 18,096 34,817
At 31 March 2008 27,739 38,006 65,745
Net book value

At 31 March 2008 248,065 27,127 275,192
The remaining amortisation period for intangible assets ranges from 3 to 7 years.
230
17 SUBSIDIARY COMPANIES
Company
2009 2008
RM’000 RM’000
Unquoted shares at cost:
At 1 April 2,036,303 2,036,303

Less: Impairment loss (327,652) (327,652)
At 31 March 1,708,651 1,708,651
The details of the subsidiary companies are as follows:
Country of Group’s
Name Principal activities incorporation effective interest
2009 2008
% %
Perusahaan Otomobil Manufacture, assembly Malaysia 100 100

Nasional Sdn. Bhd.^ and sales of motor vehicles
and related products
Proton Tanjung Malim Assembly of motor vehicles Malaysia 100 100

Sdn. Bhd.^ and related products
Proton Marketing Sdn. Bhd. Investment holding Malaysia 100 100
Lotus Advance Investment holding Malaysia 100 100

Technologies Sdn. Bhd.
Proton Hartanah Sdn. Bhd. Investment holding Malaysia 100 100
Proton Capital Sdn. Bhd. In Members’ Voluntary Malaysia 100 100

Liquidation
Subsidiariy companies of
Perusahaan Otomobil
Nasional Sdn. Bhd.
PT Proton Cikarang Ceased operations Indonesia 100 100

Indonesia

Proton Automobiles Dormant British Virgin Islands 100 100
(China) Ltd. ^

17 SUBSIDIARY COMPANIES (CONTINUED)
2009 2008
% %
Subsidiary companies of
Proton Marketing Sdn. Bhd.
Proton Corporation Liquidated during the Malaysia - 100

Sdn. Bhd. ^ financial year
Proton Cars (UK) Ltd.*^ Importation and England 100 100

distribution of motor
vehicles and related
products
Proton Cars Australia Importation and Australia 100 100

Pty. Ltd.*^ distribution of motor
vehicles and related
products
Proton Cars Benelux In Members’ Voluntary Belgium 100 100

NV. SA*^ Liquidation
Lotus Cars Asia Pacific Liquidated during the Malaysia - 100

Sdn. Bhd.^ financial year
Auto Compound and Liquidated during the Malaysia - 100

Distribution Centre financial year
Sdn. Bhd.^
Proton Edar Sdn. Bhd.^ Sales of motor vehicles, Malaysia 100 100
related spare parts
and accessories
Proton Motors (Thailand) Importation and wholesale Thailand 100 100

Co. Ltd.* of motor vehicles and
related products
Lotus Advance
Technologies Sdn. Bhd.
Proton Engineering Dormant Malaysia 100 100

Research Technology
Sdn. Bhd.^
Lotus Group International Investment holding England 100 100

Ltd.*^
232
2009 2008
% %
Subsidiary company of
Proton Hartanah Sdn. Bhd.
Proton Properties Property development Malaysia 100 100

Sdn. Bhd.^ and management
Proton Cars (UK) Ltd.
Smith & Sons Motors Liquidated during the England - 100

Ltd.*^ financial year
Proton Direct Ltd.*^ Liquidated during the England - 100

financial year

Proton Cars Liquidated during the England - 100
(Imports) Ltd.*^ financial year

Proton Cars Direct Liquidated during the England - 100
Limited* financial year
Proton Cars Australia Pty. Ltd.
Lotus Cars Australia Importation and distribution Australia 100 100

Pty. Ltd.*^ of motor vehicles and related
products

Proton Edar Sdn. Bhd.
Proton Singapore Importation and distribution Singapore 100 100

Pte. Ltd.*^ of motor vehicles and related
products
Proton Edar Resources In Members’ Voluntary Malaysia 100 100

Sdn. Bhd.^ Liquidation
Proton Edar Ventures In Members’ Voluntary Malaysia 100 100

Sdn. Bhd.^ Liquidation
PT Proton Edar Importation and distribution Indonesia 95 95

Indonesia* of motor vehicles and related
products


2009 2008
% %
Subsidiary company
of Lotus Group
International Ltd.
Group Lotus Plc.*^ Investment holding England 100 100
Group Lotus Plc.
Lotus Cars Ltd.*^ Manufacture of motor England 100 100

vehicles and engineering
consultancy services
Lotus Body Investment holding England 100 100

Engineering Ltd.*^
Lotus Motorsports Ltd.*^ Dormant England 100 100
Lotus Holdings Inc.*^ Investment holding United States 100 100

of America
Marco Acquisition Liquidated during United States - 100

Corporation*^ the financial year of America
Lotus Cars Ltd.
Lotus Engineering Ltd.*^ Engineering consultancy England 100 100
services

Lotus Engineering Engineering consultancy People’s Republic 100 100
Co. Ltd. (Shanghai)* services of China

Lotus Body Engineering Ltd.
Lotus Lightweight Investment holding England 100 -
Structures Holdings Ltd.
(formerly known as
Holden Lightweight
Structures Ltd.)*
234
2009 2008
% %
Subsidiary company of Lotus

Lightweight Structures
Holdings Ltd. (formerly
known as Holden
Lightweight Structures Ltd.)
Lotus Lightweight Manufacture of England 100 -

Structures Ltd. automotive components
(formerly known as Holden
Aluminium Worcester Ltd.)*
Lotus Engineering Ltd.
Lotus Engineering Engineering consultancy Malaysia 100 100

(Malaysia) Sdn. Bhd.^ services
Lotus Holdings Inc.
Lotus Engineering Inc.*^ Engineering consultancy United States 100 100

services of America
Lotus Cars USA Inc.*^ Sales of motor vehicles United States 100 100
and related spare parts of America
and accessories
* Audited by a member firm of PricewaterhouseCoopers International Limited which is a separate and

independent legal entity from PricewaterhouseCoopers, Malaysia
^ Consolidated by merger method of accounting prior to 1 April 2006


(a) On 15 May 2008, Lotus Body Engineering Ltd., a wholly owned subsidiary company of Lotus Group
International Ltd. which in turn is a wholly owned subsidiary company of the Company acquired
the entire issued and paid up share capital of Lotus Lightweight Structures Holdings Ltd. (formerly
known as Holden Lightweight Structures Ltd.).
The effects of the acquisition on the financial results of the Group during the financial year are as
follows:
2009
RM’000
Revenue 46,204
Operating costs (57,957)
Loss before tax (11,753)
Tax expense -

Loss for the financial year (11,753)
The details of net assets acquired and cash flows arising from the acquisition of the subsidiary company
during the financial year are as follows:
Acquiree’s
carrying value Fair value
RM’000 RM’000
Property, plant and equipment (Note 13) 4,995 1,814

Inventories 5,173 5,173
Receivables, deposits and prepayments 7,512 7,512
Deposits, bank and cash balances 4,520 4,520
Payables and other liabilities (14,355) (18,497)
Net assets/ Fair value of net assets acquired 7,845 522

Details of cash flow arising from the acquisition are as follows:

Purchase consideration settled in cash 522
Less: Cash and cash equivalents of subsidiary company acquired (4,520)
Cash inflow to the Group on acquisition of subsidiary company 3,998
Cash inflow to the Group on acquisition of subsidiary company 3,998

Had the acquisition taken effect at the beginning of the financial year, the contributed revenue and loss to the
Group would have been RM55,193,000 and RM13,160,000 respectively.
236
(b) In the prior year, Perusahaan Otomobil Nasional Sdn. Bhd. (‘PONSB’), a wholly owned subsidiary company of
the Company completed the acquisition of the remaining 49% equity interest in PT Proton Cikarang
Indonesia. As a result, PT Proton Cikarang Indonesia, a jointly controlled entity, became a wholly owned
subsidiary company of PONSB.
RM’000
Purchase consideration:
- cash consideration 33,750
- settlement of amount due from Tracoma Holdings Berhad 1,356
35,106

Fair value of net assets acquired (28,365)
Goodwill (Note 15) 6,741
Acquiree’s
carrying value Fair value
RM’000 RM’000
Property, plant and equipment (Note 13) 41,951 40,389

Prepaid land lease payment (Note 14) 16,476 25,108
Receivables, deposits and prepayments 3,045 4,356
Deposits, bank and cash balances 1,134 1,134
Payables and other liabilities (9,348) (11,096)
Deferred tax (Note 22) - (2,439)
Net assets acquired 53,258 57,452
Less: Amount previously accounted for as a jointly controlled entity (29,087)
Fair value of net assets acquired 28,365
Details of cash flow arising from the acquisition are as follows:

Purchase consideration settled in cash 33,750
Less: Cash and cash equivalents of subsidiary company acquired (1,134)
Cash outflow of the Group on acquisition of subsidiary company 32,616
The acquired business contributed revenue of RM849,000 and loss of RM2,795,000 to the Group for
the period from 10 August 2007 to 31 March 2008. Had the acquisition taken effect at the beginning
of the financial year, the contributed revenue and loss to the Group would have been RM1,100,000 and
RM5,297,000 respectively.

18 ASSOCIATED COMPANIES
Group Company
2009 2008 2009 2008
RM’000 RM’000 RM’000 RM’000
Unquoted shares at cost 59,252 59,252 13,600 13,600

Share of post-acquisition reserves 131,993 132,391 - -
191,245 191,643 13,600 13,600
Less: Impairment loss (32,878) (26,200) - -
158,367 165,443 13,600 13,600
The Group’s share of the assets, liabilities, revenue and expenses of the associated companies are as follows:
Group
2009 2008
RM’000 RM’000
Non-current assets 112,703 81,652

Current assets 161,000 204,383
Current liabilities (105,804) (110,902)
Non-current liabilities (9,532) (9,690)
Net assets 158,367 165,443
Revenue 236,058 260,507

Expenses (excluding tax) (222,351) (245,202)
Profit before taxation 13,707 15,305
Taxation 6,513 (2,171)
Profit for the financial year 20,220 13,134
238
18 ASSOCIATED COMPANIES (CONTINUED)

The details of the associated companies are as follows:
2009 2008
% %
PHN Industry Sdn. Bhd. Manufacture and sales of Malaysia 35 35

stamped parts and
sub-assembly of automotive
metal components
Marutech Elastomer Manufacture and production Malaysia 25 25

Industries Sdn. Bhd. of moulded products,
extruded and rubber hoses
for motor vehicles, motorcycle
and other related products
Exedy (Malaysia) Sdn. Bhd. Manufacture and assembly Malaysia 45 45

of manual clutch and
automatic transmission parts
Associated company of
Perusahaan Otomobil
Nasional Sdn. Bhd.
Vina Star Motors Import, assembly and Socialist 25 25

Corporation distribution of motor vehicles Republic of
Vietnam
Proton Hartanah Sdn. Bhd.
Proton City Development Property developer and Malaysia 40 40

Corporation Sdn. Bhd. project management
Associated company
of Proton Cars (UK) Ltd.
Proton Finance Ltd. Provision of dealer and England 49.99 49.99

customer financing

18 ASSOCIATED COMPANIES (CONTINUED)
2009 2008
% %
Associated company
of Proton Edar Sdn. Bhd.
Netstar Advance Systems Manufacture, assembly and Malaysia 40 40

Sdn. Bhd. sales of vehicle tracking
devices

Associated company
of Proton Automobile
(China) Ltd.
Goldstar Proton Dormant People’s Republic 49 49

Automobiles Co. Ltd. * of China
Lotus Advance Technology
Sdn. Bhd.
Miyazu (Malaysia) Development, marketing Malaysia 51 51

Sdn. Bhd.** and sale of products and
provision of services relating
to dies, moulds and jigs
* The Group has initiated proceeding to dissolve the associated company via an arbitration process
(Note 43(c)).
** Company in which the Group owns more than 50% and exercises significant influence. However, it does not
have control over its financial and operating policies.
The share of capital commitments relating to the associated companies are as follows:
Group
2009 2008
RM’000 RM’000
Capital commitments
Capital expenditure for property, plant and equipment

approved but not provided for in the financial
statements:
Contracted for 233 745

Not contracted for 1,736 8,990
240
19 JOINTLY CONTROLLED ENTITIES

Group
2009 2008
RM’000 RM’000
Unquoted shares at cost

At 1 April 2008 136,648 179,303
Reclassified to investment in subsidiary company - (42,655)
Liquidated (1,114) -
At 31 March 2009 135,534 136,648
Accumulated impairment loss

At 1 April 2008 1,114 1,114
Liquidated (1,114) -
At 31 March 2009 - 1,114
Share of post-acquisition reserves 60,088 57,213
195,622 192,747
The Group’s share of the assets, liabilities, revenue and expenses of the jointly controlled entities are as
follows:
Group
2009 2008
RM’000 RM’000
Non-current assets 290,168 319,710

Current assets 151,926 153,300
Current liabilities (82,559) (53,198)
Non-current liabilities (163,913) (227,065)
Net assets 195,622 192,747
Revenue 175,673 168,746

Expenses (excluding tax) (156,000) (157,642)
Profit before taxation 19,673 11,104
Taxation (5,079) (3,267)
Profit for the financial year 14,594 7,837

19 JOINTLY CONTROLLED ENTITIES (CONTINUED)

The details of the jointly controlled entities are as follows:
2009 2008
% %
Jointly controlled entities of

Proton Marketing Sdn. Bhd.
Proton Parts Centre Trading in motor vehicle Malaysia 55 55

Sdn. Bhd.* components, spare parts
and accessories
Proton Cars (Europe) Ltd. Liquidated during the England - 56

financial year
Jointly controlled entity

of Group Lotus Plc.
Lotus Finance Ltd. Provision of motor England 49.9 49.9

vehicles financing

of Proton Edar Sdn. Bhd.
Proton Commerce Provision of motor Malaysia 50 50

Sdn. Bhd. vehicles financing
* Company in which the Group owns more than half of the voting powers. However, as the Group only
has joint control over its financial and operating policies, this investment is treated as a jointly
controlled entity.
The share of capital commitments relating to the jointly controlled entities is as follows:
Group
2009 2008
RM’000 RM’000
Capital commitments

approved but not provided for in the financial
statements:
Not contracted for 1,062 1,288
242
20 AMOUNTS DUE FROM SUBSIDIARY COMPANIES

Company
Less than More than Less than More than
1 year 1 year Total 1 year 1 year Total
2009 2009 2009 2008 2008 2008
RM’000 RM’000 RM’000 RM’000 RM’000 RM’000

companies 58,912 - 58,912 66,219 - 66,219
Advances to a subsidiary company - 177,870 177,870 - - -
58,912 177,870 236,782 66,219 - 66,219
The amounts due from subsidiary companies are denominated in Ringgit Malaysia, interest free and repayable
on demand.
Advances to a subsidiary company are denominated in Ringgit Malaysia, repayable between 1 to 3 years and
bears interest at 3.5% per annum.
21 INVESTMENTS
Group Company
2009 2008 2009 2008
RM’000 RM’000 RM’000 RM’000
Unquoted investments in Malaysia:
At cost 13,347 13,347 8,575 8,575

Allowance for diminution in value (2,950) (2,950) (2,100) (2,100)
10,397 10,397 6,475 6,475

22 DEFERRED TAXATION
Deferred tax assets and liabilities are offset when there is a legally enforceable right to set off current tax
assets against current tax liabilities and when the deferred taxes relate to the same tax authority. The following
amounts, determined after appropriate offsetting, are shown in the balance sheet:
Group
2009 2008
RM’000 RM’000
Subject to income tax:

Deferred tax assets 5,727 -
Deferred tax liabilities (12,243) (2,439)
(6,516) (2,439)
Movement of deferred tax

At start of financial year (2,439) (754)
Credited/(charged) to income
statement (Note 10)
- property, plant and equipment (8,841) 5,519
- capitalised development cost (43,436) (1,865)
- allowances and provisions 49,624 (8,115)
- others (1,424) 5,215
(4,077) 754
Acquired through business combination (Note 17(b)) - (2,439)
At end of financial year (6,516) (2,439)
Deferred tax assets (before offsetting)

- property, plant and equipment 17 -
- allowances and provisions 86,074 36,450
- others 561 -
86,652 36,450
Offset of deferred tax liabilities (80,925) (36,450)
Deferred tax assets (after offsetting) 5,727 -
244
22 DEFERRED TAXATION (CONTINUED)
Group
2009 2008
RM’000 RM’000
Deferred tax liabilities (before offsetting)

- capitalised development cost (78,364) (34,928)
- property, plant and equipment (12,819) (3,961)
- others (1,985) -
(93,168) (38,889)
Offset against deferred tax assets 80,925 36,450
Deferred tax liabilities (after offsetting) (12,243) (2,439)
The tax effect of temporary differences (which have no expiry dates) for which no deferred tax asset is
recognised in the balance sheet are as analysed below:
Group
2009 2008
RM’000 RM’000
Temporary differences of which

no deferred tax asset is recognised
Unrecognised tax losses 158,263 174,516

Unabsorbed capital allowances 497,646 413,507
Unrecognised reinvestment allowances 498,341 465,431
Other temporary differences 79,082 34,768
As at 31 March 2009, there are no temporary differences associated with unremitted earnings of subsidiary
companies, associated companies and joint controlled entities for the recognition of deferred tax liabilities
(2008: Nil).

23 INVENTORIES
Group
2009 2008
RM’000 RM’000
Raw materials:
- completely knocked-down packs of vehicles 244,888 193,514
- others 164,115 89,290
Parts, accessories and general stores 68,862 73,995
Work-in-progress 219,188 188,779
Finished vehicles 640,945 511,065
Goods-in-transit 35,723 21,520
Land held for development 9,552 9,541
Properties for sale 11,808 12,582
1,395,081 1,100,286
24 TRADE AND OTHER RECEIVABLES

Group Company
2009 2008 2009 2008
RM’000 RM’000 RM’000 RM’000
Trade receivables 611,944 707,039 - -

Allowance for doubtful debts (51,583) (19,277) - -
560,361 687,762 - -
Other receivables 125,820 213,099 145 14

Allowance for doubtful debts (22,954) (77,122) - -
102,866 135,977 145 14
Government grant receivable 80,656 - - -

Warranty claims reimbursable (Note 34) 111,451 112,258 - -
Prepayments 20,368 18,316 - -
Deposits 14,393 15,031 - -
890,095 969,344 145 14
246
24 TRADE AND OTHER RECEIVABLES (CONTINUED)
The currency exposure profile of trade and other receivables are as follows:
Currency exposure profile as at 31.3.2009

Ringgit Pound US
Malaysia Sterling Dollar Euro Others Total
RM’000 RM’000 RM’000 RM’000 RM’000 RM’000
Group
Functional currency
Ringgit Malaysia 530,497 31,764 78,307 21,985 51,611 714,164

Pound Sterling - 37,178 82,823 15,503 2,410 137,914
Others - - - 198 37,819 38,017
530,497 68,942 161,130 37,686 91,840 890,095
Company
Functional currency
Ringgit Malaysia 145 - - - - 145

Ringgit Pound US
RM’000 RM’000 RM’000 RM’000 RM’000 RM’000
Group
Functional currency

Pound Sterling - 46,943 46,864 18,382 6,916 119,105
Others - - - 207 10,279 10,486
625,197 71,603 110,118 53,097 109,329 969,344
Company
Functional currency

24 TRADE AND OTHER RECEIVABLES (CONTINUED)
Credit terms of trade receivables for the Group ranges from 14 to 360 days (2008: 14 to 360 days). However, the
majority of the Group’s trade receivables have a credit term between 14 to 90 days (2008: 14 to 90 days).
Group sales are concentrated in Malaysia with one major third party customer in Malaysia making up 27.5%
(2008: 25%) of total Group revenue.
The Group has no significant concentrations of credit risk except for an amount of RM81,138,000 (2008:
RM205,057,000) due from a single customer. The Directors are of the view that the credit risk is minimal in view
of the stability and historical settlement of the receivables from this customer.
25 AMOUNTS DUE FROM ASSOCIATED COMPANIES

The amounts due from associated companies arose from normal trade transactions. These amounts have credit
terms ranging from 30 to 60 days (2008: 30 to 60 days).
The currency exposure profile of amounts due from associated companies are as follows:

Ringgit Pound
Malaysia Sterling Total
RM’000 RM’000 RM’000
Group
Functional currency
Ringgit Malaysia 18,219 16 18,235

Pound Sterling - 49 49
18,219 65 18,284

Ringgit Pound
RM’000 RM’000 RM’000
Group
Functional currency
Ringgit Malaysia 9,645 - 9,645

Pound Sterling - 1,068 1,068
9,645 1,068 10,713
248
26 AMOUNTS DUE FROM JOINTLY CONTROLLED ENTITIES

The amounts due from jointly controlled entities arose from normal trade transactions. These amounts have
credit terms ranging from 30 to 45 days (2008: 30 to 45 days).
The currency exposure profile of amounts due from jointly controlled entities are as follows:

Ringgit Pound
RM’000 RM’000 RM’000
Group
Functional currency
Ringgit Malaysia 8,894 16 8,910

8,894 2,459 11,353

Ringgit Pound
RM’000 RM’000 RM’000
Group
Functional currency

27 CURRENT INVESTMENTS
Group
2009 2008
RM’000 RM’000
Lower of cost and market value:

Commercial papers and corporate debt

- quoted investments in Malaysia 584 526
- unquoted investments in Malaysia 14,729 20,296
15,313 20,822
Market value of quoted investments:

Commercial papers and corporate debt 724 806
28 DEPOSITS, BANK AND CASH BALANCES

Group Company
2009 2008 2009 2008
RM’000 RM’000 RM’000 RM’000
Short term funds deposited with

licensed banks 717,221 1,062,834 208,955 25,920
Bank and cash balances 196,629 163,176 468 376
913,850 1,226,010 209,423 26,296
The maturity profile of short term funds

are as follows:
0 - 1 month 486,044 279,583 51,159 19,800

2 - 3 months 224,784 773,899 157,796 6,120
4 - 6 months - 1,800 - -
6 - 12 months 6,393 7,552 - -
717,221 1,062,834 208,955 25,920
250
28 DEPOSITS, BANK AND CASH BALANCES (CONTINUED)
Bank balances are deposits held at call with banks.

Ringgit Pound US
RM’000 RM’000 RM’000 RM’000 RM’000 RM’000
Group
Functional currency

Pound Sterling - 67,549 16,305 10,165 5,554 99,573
Australian Dollar - - - - 15,012 15,012
Others - - - 1,086 25,493 26,579
717,899 72,527 39,841 16,445 67,138 913,850

Ringgit Pound US
RM’000 RM’000 RM’000 RM’000 RM’000 RM’000
Group
Functional currency
Ringgit Malaysia 1,107,976 2,501 2,726 4,960 7,354 1,125,517

Pound Sterling - 33,496 19,243 5,454 2,713 60,906
Australian Dollar - - - - 38,451 38,451
Others - - - 1,136 - 1,136
1,107,976 35,997 21,969 11,550 48,518 1,226,010
Deposits, bank and cash balances in the Company as at 31 March 2009 and 2008 are denominated in Ringgit
Malaysia.
The weighted average effective interest rates of deposits at the balance sheet date were 2.59% (2008: 3.52%)
per annum for the Group and 1.90% (2008: 3.20%) per annum for the Company.
The Group has unutilised banking facilities amounting to RM623.7 million (2008: RM783.0 million) as at
31 March 2009.

29 NON-CURRENT ASSETS HELD FOR SALE

Group
2009 2008
RM’000 RM’000
Non-current assets classified as held for sale:

- property, plant and equipment (Note 13) 13,728 -
- prepaid land lease payments (Note 14) 22,684 -
36,412 -
30 SHARE CAPITAL
Group and Company
2009 2008
RM’000 RM’000
Authorised:
Ordinary shares of RM1.00 each
At start/end of financial year 1,000,000 1,000,000
Issued and fully paid:

Ordinary shares of RM1.00 each
At start/end of financial year 549,213 549,213
252
31 RESERVES
(a) Retained earnings
Under the single-tier tax system which came into effect from the year of assessment 2008, companies are
not required to have tax credits under Section 108 of the Income Tax Act, 1967 for dividend payment
purposes. Dividends paid under this system are tax exempt in the hands of shareholders.
Companies with Section 108 credits as at 31 December 2007 may continue to pay franked dividends until
the Section 108 credits are exhausted or 31 December 2013 whichever is earlier unless they opt to disregard
the Section 108 credits to pay single-tier dividends under the special transitional provisions of the Finance
Act, 2007.
As at 31 March 2009, the Company has sufficient Section 108 tax credits to frank approximately RM1,377.0
million (2008: RM1,325.8 million) of its retained earnings as at 31 March 2009 if paid out as dividends.
In addition, the Company has tax exempt income as at 31 March 2009 amounting to approximately RM324.8
million (2008: RM321.5 million) available for distribution of tax exempt dividends to its shareholders.
(b) Capital reserve
The capital reserve arose as a result of a Group reorganisation exercise whereby all existing shareholders
of Perusahaan Otomobil Nasional Sdn. Bhd. (‘PONSB’) exchanged all their ordinary shares of RM1.00 each
comprising 549,213,000 ordinary shares in PONSB for 549,213,000 new ordinary shares of RM1.00 each in the
Company in a one-for-one share exchange on 5 April 2004. Following the share for share exchange,
the Company has no share premium. Accordingly, the amount of share premium previously recognised on
consolidation has been re-designated as capital reserve.
(c) Asset revaluation reserve
The asset revaluation reserve arose as a result of a fair value adjustment of the 51% equity interest
previously held in PT Proton Cikarang Indonesia as a jointly controlled entity upon the acquisition of the
remaining 49% equity interest on 10 August 2007.

32 LONG TERM LIABILITIES
Group
2009 2008
RM’000 RM’000
Unsecured:
Long term loan (Note 32(a)) 47,879 47,879
Portion repayable within twelve months (Note 38) (47,879) -
- 47,879
Secured:
Long term loan (Note 32(b)) 67,893 83,005
Portion repayable within twelve months (Note 38) (15,668) -
52,225 83,005
Lease and hire purchase creditors (Note 32(c)) 3,395 5,124

Less: Portion repayable within twelve months (Note 33) (858) (973)
2,537 4,151
Automotive Development Fund (Note 32(d)) 21,686 45,343

Employee retirement benefits (Note 32(e)) 25,068 50,095
101,516 230,473
The currency exposure profile of the long term liabilities is as follows:

Ringgit Pound
RM’000 RM’000 RM’000
Group
Functional currency

21,686 79,830 101,516
254
32 LONG TERM LIABILITIES (CONTINUED)

Ringgit Pound
RM’000 RM’000 RM’000
Group
Functional currency

93,221 137,252 230,473
(a) Long term loan - unsecured
Group
2009 2008
RM’000 RM’000
The long term loan is repayable as follows:
Within one year 47,879 -

Between one and two years - 47,879
47,879 47,879
The loan balance of RM47.9 million (2008: RM47.9 million) which is due on 30 September 2009, is interest
free and denominated in Ringgit Malaysia.


(b) Long term loan - secured
Group
2009 2008
RM’000 RM’000
The long term loan is repayable as follows:
Within one year 15,668 -

Between one and two years 20,890 44,695
More than two years 31,335 38,310
67,893 83,005
The long term loan is secured over a subsidiary company’s fixed and floating assets as disclosed in Note 13
and bears an interest rate of 7.32% (2008: 8.44%) per annum.
(c) Lease and hire purchase creditors - secured
The lease and hire purchase arrangements obtained by subsidiary companies are secured against the related
assets of the respective subsidiary companies.
Group
2009 2008
RM’000 RM’000
The lease and hire purchase creditors are repayable as follows:
Within one year 1,084 1,325

Between one and two years 1,084 1,325
Between two and five years 1,714 3,421
3,882 6,071

Less: Future finance charges (487) (947)
Present value of lease and hire purchase creditors 3,395 5,124
Current (Note 33) 858 973

Non-current 2,537 4,151
Present value of lease and hire purchase creditors 3,395 5,124
The lease and hire purchase creditors bears an interest rate of 7.5% (2008: 7.5%) per annum.
256

(d) Automotive Development Fund

The Government of Malaysia approved the setting up of an Automotive Development Fund (‘ADF’) under
the Ninth Malaysia Plan with the objective of modernising and automating the manufacturing processes,
improving efficiency, productivity, quality and the application of automation for the Malaysian automotive
industry.
The Government of Malaysia had as at 31 March 2008, disbursed a total of RM50 million to the Group to be
utilised for payments to external parties for the purpose of developing and promoting a competitive and
viable domestic automotive sector as a mean to achieve the objective of the ADF.
Group
2009 2008
RM’000 RM’000
The ADF comprises:
(i) ADF liabilities 14,467 45,343

(ii) Capital grant 9,403 -
23,870 45,343

Less: Current portion of capital grant (2,184) -
Non-current 21,686 45,343
(i) ADF liabilities
At 1 April 45,343 50,201

Interest earned during the financial year 681 1,402
46,024 51,603

Less: Utilised during the financial year (31,557) (6,260)
At 31 March (Note 44) 14,467 45,343


(d) Automotive Development Fund (continued)
Group
2009 2008
RM’000 RM’000
(ii) Capital grant
At 1 April - -
Add: Received during the financial year 31,049 -
Less: Amortisation (21,646) -
At 31 March 9,403 -

Current 2,184 -
Non-current 7,219 -
9,403 -
The current portion of the capital grant is presented within other payables (Note 33).
(e) Employee retirement benefits
The employee retirement benefits represents the scheme operated by a subsidiary company.
(i) Defined contribution plan
The Group pays contributions to publicly or privately administered pension plans on either a
mandatory, contractual or voluntary basis depending on the nature of the defined contribution
plans. The Group has no further payment obligations once the contributions have been paid. The
contributions are recognised as employee benefit expense when they are due. Prepaid contributions
are recognised as an asset to the extent that a cash refund or reduction in the future payments is
available.
(ii) Defined benefit plan
Lotus Group Scheme - defined benefit scheme
Lotus Group International Ltd. and its subsidiary companies (‘Lotus Group’), operate a defined benefit
pension scheme, the Lotus Pension Plan. The assets are held in separate trustee administered funds. In
addition, it provides life assurance cover for all employees.
258
(e) Employee retirement benefits (continued)
(ii) Defined benefit plan (continued)
Contributions to the scheme are charged to the income statement so as to spread the cost of pensions
over employees’ working lives with the Lotus Group. The contributions are determined by a qualified
actuary. An actuarial update of the plan was carried out for the period from 1 April 2008 to 31 March
2009.
The movements during the financial year in the Consolidated Balance Sheet are as follows:
Group
2009 2008
RM’000 RM’000
At 1 April 50,095 49,842

(Credited)/charged to income statement (Note 8) (8,042) 14,616
Contributions paid (9,369) (11,155)
At 31 March 25,068 50,095
The amounts recognised in the Consolidated Balance Sheet are analysed as follows:
Group
2009 2008
RM’000 RM’000
Present value of obligation 234,156 316,128

Fair value of plan assets (224,494) (341,917)
Shortfall/(excess) of funded plan 9,662 (25,789)
Unrecognised actuarial gain 15,406 75,884
Liability on balance sheet 25,068 50,095

The movements in the defined benefit obligation during the financial year are as follows:
Group
2009 2008
RM’000 RM’000
At 1 April 316,128 392,068

Interest cost 18,926 21,066
Current service cost 4,266 4,768
Employee contributions 3,817 4,509
Benefits paid (11,495) (9,941)
Actuarial gain on obligation (41,898) (76,342)
At 31 March 234,156 316,128
The movements in the fair value of plan assets during the financial year are as follows:
Group
2009 2008
RM’000 RM’000
At 1 April 341,917 369,469

Expected return on plan assets 21,162 26,219
Employer contributions 9,369 11,155
Employee contributions 3,817 4,509
Benefits paid (11,495) (9,941)
Actuarial loss on plan assets (84,705) (38,728)
At 31 March 224,494 341,917
260
The mortality assumptions used were as follows:
Group
2009 2008
RM’000 RM’000
Longevity at age 65 for current pensioners:

- Male 84.9 84.7
- Female 87.9 87.8
Longevity at age 65 for future pensioners:
- Male 86.1 86.0
- Female 89.1 89.0
The expenses recognised in the Consolidated Income Statements are analysed as follows:
Group
2009 2008
RM’000 RM’000
Current service cost 4,266 4,768

Interest cost 18,926 21,066
Expected return on plan assets (21,162) (26,219)
Net actuarial gain recognised in financial year (10,072) -
Amortisation of transitional liability - 15,001
Total, included in staff costs within

administrative expenses (Note 8) (8,042) 14,616
Actual return on plan assets (63,543) (12,509)

The principal actuarial assumptions used in respect of the Group’s defined benefit plan were as follows:
Group
2009 2008
% %
Discount rates 6.90 6.60

Expected return on plan assets
- equity 7.25 7.25
- bonds 4.50 4.50
- others 4.50 4.50
Expected rate of salary increase 4.00 4.40
Expected rate of pension payment increase 3.00 3.30
Inflation 3.00 3.40
The expected return on the average value of the assets over the period i s calculated using the long-term
average rate of return expected over the remaining term of the Lotus Pension Plan’s liabilities.
33 TRADE AND OTHER PAYABLES

Group Company
2009 2008 2009 2008
RM’000 RM’000 RM’000 RM’000
Trade payables 287,158 313,546 - -

Other payables 95,597 126,189 482 575
Accruals 817,796 738,601 - -
Payments received in advance for
engineering contracts 76,249 56,211 - -
Lease and hire purchase creditors
- current portion (Note 32) 858 973 - -
1,277,658 1,235,520 482 575
262
33 TRADE AND OTHER PAYABLES (CONTINUED)
The currency exposure profile of trade and other payables are as follows:

Ringgit Pound US
RM’000 RM’000 RM’000 RM’000 RM’000 RM’000
Group
Functional currency
Ringgit Malaysia 959,908 523 39,428 7,080 30,821 1,037,760

Pound Sterling - 127,742 80,028 22,584 1,599 231,953
Others - - - 203 7,742 7,945
959,908 128,265 119,456 29,867 40,162 1,277,658
Company
Functional currency

Ringgit Pound US
RM’000 RM’000 RM’000 RM’000 RM’000 RM’000
Group
Functional currency
Ringgit Malaysia 924,780 1,897 48,680 12,762 47,403 1,035,522

Pound Sterling - 131,948 42,092 21,357 779 196,176
Others - - - - 3,822 3,822
924,780 133,845 90,772 34,119 52,004 1,235,520
Company
Functional currency
Terms of trade payables granted to the Group and Company varies between no credit to 60 days (2008: no credit
to 60 days) credit.

34 PROVISIONS
Group
Provision Onerous
for warranty contract Total
RM’000 RM’000 RM’000
2009
At 1 April 186,556 - 186,556

Charge to income statement (Note 7) 62,862 4,426 67,288

Warranties reimbursable 43,054 - 43,054
Provision for the financial year 105,916 4,426 110,342

Utilised during the financial year (102,257) - (102,257)
At 31 March 185,353 4,426 189,779
Group
Provision Onerous
for warranty contract Total
RM’000 RM’000 RM’000
2008
At 1 April 196,067 - 196,067

Charged to income statement (Note 7) 45,526 - 45,526

Warranties reimbursable 45,572 - 45,572

Provision for the financial year 91,098 - 91,098
Utilised during the financial year (99,301) - (99,301)
At 31 March 186,556 - 186,556
The Group expects to be reimbursed by suppliers in respect of warranties amounting to RM111,451,000 (2008:
RM112,258,000) as disclosed in Note 24 to the financial statements.
264
35 AMOUNTS DUE TO SUBSIDIARY COMPANIES
Amounts due to subsidiary companies were fully repaid during the financial year.
36 AMOUNTS DUE TO ASSOCIATED COMPANIES

Amounts due to associated companies arose from normal trade transactions, are denominated in Ringgit
Malaysia and payable within 30 to 60 days (2008: 30 to 60 days).
37 AMOUNTS DUE TO JOINTLY CONTROLLED ENTITIES
Amounts due to jointly controlled entities arose from normal trade transactions, and are due between 30 to 45
days (2008: 30 to 45 days).
The currency exposure profile of the amounts due to jointly controlled entities is as follows:

Pound US Ringgit
Sterling Dollar Malaysia Total
RM’000 RM’000 RM’000 RM’000
Group
Functional currency
Ringgit Malaysia - - 14,622 14,622

Pound Sterling 307 - - 307
Australian Dollar - 266 - 266
307 266 14,622 15,195

Pound US Ringgit
Sterling Dollar Malaysia Total
RM’000 RM’000 RM’000 RM’000
Group
Functional currency
Ringgit Malaysia - - 16,347 16,347

Pound Sterling 290 - - 290
Australian Dollar - 321 - 321
290 321 16,347 16,958

38 SHORT TERM BORROWINGS
Effective interest rate

d
uring the financial year Group
2009 2008 2009 2008
% % RM’000 RM’000
Unsecured:
Long term loan
- current portion (Note 32) - - 47,879 -
Bridging loan 5.00 – 6.00 5.00 – 6.00 36,595 31,985
Bankers’ acceptance 2.88 – 4.82 4.20 141,317 964
Revolving credit 3.50 – 6.00 4.00 – 6.00 30,813 38,310
Bank overdrafts - 7.51 – 7.59 - 6,728
256,604 77,987
Secured:
Long term loan
- current portion (Note 32) 7.32 - 15,668 -
Revolving credit 4.00 – 10.00 7.00 – 10.00 33,767 35,619
49,435 35,619
306,039 113,606
The revolving credit is secured over a subsidiary company’s fixed and floating assets.
The currency exposure profile of the short term borrowings is as follows:

Ringgit Pound
RM’000 RM’000 RM’000
Group
Functional currency

189,196 116,843 306,039
266
38 SHORT TERM BORROWINGS (CONTINUED)

Ringgit Pound
RM’000 RM’000 RM’000
Group
Functional currency
Ringgit Malaysia 964 - 964

964 112,642 113,606
39 SEGMENTAL INFORMATION
The Group is principally engaged in the automobile industry namely, manufacturing, assembling, trading and
provision of engineering and other services in respect of motor vehicles and related products. Accordingly, no
segmental information is considered necessary for analysis by industry segment.
Inter-segment sales comprise sales of motor vehicles, parts and engineering services to Group companies in
different geographical locations.
Analysis of the Group’s revenue, results and other information by geographical locations are as follows:
Malaysia Other countries Elimination Total

2009 2008 2009 2008 2009 2008 2009 2008
RM’million RM’million RM’million RM’million RM’million RM’million RM’million RM’million
Revenue
External sales 5,689.6 4,617.4 797.0 1,004.2 - - 6,486.6 5,621.6
Inter-segment sales 121.6 117.4 47.2 30.6 (168.8) (148.0) - -
Total revenue 5,811.2 4,734.8 844.2 1,034.8 (168.8) (148.0) 6,486.6 5,621.6
Results
Segment operating
(loss)/profit (273.0) 163.7 (106.5) (18.4) (3.4) (40.8) (382.9) 104.5
Unallocated income 1.3 4.7
Interest expense (14.4) (17.9)
Interest income 42.0 32.1
Share of net results of
associated companies
and jointly controlled
entities 20.3 14.5 5.3 12.8 9.2 (6.3) 34.8 21.0
Taxation 17.4 40.2
(Loss)/profit after taxation (301.8) 184.6

39 SEGMENTAL INFORMATION (CONTINUED)

2009 2008 2009 2008 2009 2008 2009 2008
Other information
Segment assets 5,703.4 6,096.9 820.5 663.5 - - 6,523.9 6,760.4
Unallocated assets 575.0 532.9
Total assets 7,098.9 7,293.3
Segment liabilities 1,287.0 1,324.1 284.3 199.9 - - 1,571.3 1,524.0

Unallocated liabilities 426.1 348.1
Total liabilities 1,997.4 1,872.1

Capital expenditure 562.4 440.7 138.0 92.5 - - 700.4 533.2
Depreciation and
amortisation 473.4 368.7 25.4 48.7 - - 498.8 417.4
Assets written off 34.2 18.3 4.6 0.2 - - 38.8 18.5
Impairment:
- property, plant and
equipment 257.7 - - - - - 257.7 -
- capitalised
development cost 20.8 - - - - - 20.8 -
Research and
development grant (80.7) (193.8) - - - - (80.7) (193.8)
Allowance for
doubtful debts 45.6 7.7 - - - - 45.6 7.7
Write down/(write back)
of inventories 108.8 (27.2) 6.1 2.1 - - 114.9 (25.1)
Unallocated income includes dividend from other investments, gain/(loss) on disposal of current investments
and write down/(write back) of provision for diminution in value of current investments. Segment assets consist
primarily of property, plant and equipment, intangible assets, inventories, receivables and operating cash, and
excludes investments in associated companies, jointly controlled entities, investments, current investments,
goodwill and taxation. Segment liabilities comprise operating liabilities and exclude items such as taxation,
borrowings and employee retirement benefits.
Capital expenditure mainly comprises additions to property, plant and equipment and intangible assets (Notes
13 and 16 to the financial statements).
268
39 SEGMENTAL INFORMATION (CONTINUED)
Secondary reporting format
The primary reporting format is based on geographical locations of the assets. The industry segmentation is
considered unnecessary as the Group is principally engaged in the automobile industry. Therefore, only sales to
external customers based on the location of the customer are presented below:

2009 2008 2009 2008 2009 2008 2009 2008
Revenue
External sales 5,372.3 4,165.4 1,114.3 1,456.2 - - 6,486.6 5,621.6
Inter segment sales 121.6 117.4 47.2 30.6 (168.8) (148.0) - -
Total revenue 5,493.9 4,282.8 1,161.5 1,486.8 (168.8) (148.0) 6,486.6 5,621.6
40 CAPITAL AND OTHER COMMITMENTS
Group
2009 2008
RM’000 RM’000
Capital commitments

and intangible assets approved by the Board but not provided
for in the financial statements:
Contracted for 184,745 276,748

Not contracted for 2,421,085 2,017,329

41 OPERATING LEASES
As at 31 March 2009, the Group was committed to making the following payments in respect of operating leases
expiring:
Group
Office
Land and Plant and equipment
buildings machinery and vehicles Total
RM’000 RM’000 RM’000 RM’000
2009
Within one year 11,414 965 1,254 13,633

Between one and five years 13,896 2,261 1,231 17,388
After five years 1,353 52 - 1,405

26,663 3,278 2,485 32,426
Group
Office
Land and Plant and equipment
buildings machinery and vehicles Total
RM’000 RM’000 RM’000 RM’000
2008
Within one year 12,597 1,164 514 14,275

Between one and five years 14,931 955 659 16,545
27,528 2,119 1,173 30,820
270
42 SIGNIFICANT RELATED PARTY TRANSACTIONS DISCLOSURES

In the normal course of business, the Group and Company undertake a variety of transactions at mutually agreed
terms with subsidiary companies, associated companies, jointly controlled entities and other related parties.
The related parties with whom the Group and Company transact with, include the following companies:
Related parties Relationship
Lotus Group International Ltd. Subsidiary company

Miyazu (Malaysia) Sdn. Bhd. Associated company
PHN Industry Sdn. Bhd. Associated company
Marutech Elastomer Industries Sdn. Bhd. Associated company
Exedy (Malaysia) Sdn. Bhd. Associated company
Proton City Development Corporation Sdn. Bhd. Associated company
Netstar Advance Systems Sdn. Bhd. Associated company
Proton Finance Ltd. Associated company
Lotus Finance Ltd. Jointly controlled entity
Proton Parts Centre Sdn. Bhd. Jointly controlled entity
PEPS-JV (M) Sdn. Bhd. Equity investment
Technomeiji Rubber Industries Sdn. Bhd. Equity investment
Aluminium Alloy Industries Sdn. Bhd. Equity investment
Ara Borgstena Sdn. Bhd. Equity investment
In addition to related party disclosures mentioned elsewhere in the financial statements, set out below are
other significant related party transactions. The related party transactions described below were carried out on
terms and conditions obtainable in transactions with unrelated parties unless otherwise stated.
(a) Interest income from advances to a subsidiary company
Company
2009 2008
RM’000 RM’000
Subsidiary company
- Lotus Group International Ltd. 5,680 301
(b) Sales of goods and services

Group
2009 2008
RM’000 RM’000
Jointly controlled entities
- Proton Parts Centre Sdn. Bhd. 25,566 17,925
- Lotus Finance Ltd.* 45,988 88,590

Associated company
- Proton Finance Ltd.* 30,787 61,892
* Under the terms of financing agreements, Lotus Finance Ltd. and Proton Finance Ltd. provide financing
services to dealers and customers of the Group to acquire vehicles. Vehicles under financing arrangements
are sold through Lotus Finance Ltd. and Proton Finance Ltd..

42 SIGNIFICANT RELATED PARTY TRANSACTIONS DISCLOSURES (CONTINUED)

(c) Purchases of goods and services from:
Group
2009 2008
RM’000 RM’000
Associated companies
- PHN Industry Sdn. Bhd. 123,623 70,338
- Marutech Elastomer Industries Sdn. Bhd. 1,048 1,302
- Exedy (Malaysia) Sdn. Bhd. 8,619 11,089
- Proton City Development Corporation Sdn. Bhd. 34 111
- Netstar Advance Systems Sdn. Bhd. 6,487 14,407
- Miyazu (Malaysia) Sdn. Bhd. 136,524 185,398

- Proton Parts Centre Sdn. Bhd. 98,179 86,838

Equity investment companies
- PEPS-JV (M) Sdn. Bhd. 191,301 189,054
- Technomeiji Rubber Industries Sdn. Bhd. 3,589 7,410
- Aluminium Alloy Industries Sdn. Bhd. 44,712 17,583
- Ara Borgstena Sdn. Bhd. 30 1,247
(d) Interest expense
Associated company
- Proton Finance Ltd. 694 465
(e) Key management personnel compensation

Key management is defined as those persons having authority and responsibility for planning, directing and
controlling the activities of the Group, directly or indirectly, including Executive and Non-Executive
directors. The key management compensation disclosed below excludes the Executive and Non-Executive
Directors’ compensation as disclosed in Note 8 to the financial statements:
Group
2009 2008
RM’000 RM’000
Salaries and other short-term employee benefits 10,822 8,054

Defined contribution retirement plan 1,243 811
272
43 CONTINGENT LIABILITIES
(a) In a prior financial year, a supplier had obtained a judgment in default against a subsidiary
company for RM12.2 million after failing to reach a formal agreement. The subsidiary company
had obtained legal opinion that the claims are without basis and action has been taken to set aside
the judgment. The Directors are of the opinion, based on legal advice, that the claims have no merits
and are unlikely to succeed.
(b) A distributor instituted arbitration proceedings against a subsidiary company as a result of the
termination of its distributorship, for which the distributor had claimed USD9.9 million (RM36.2
million) plus general damages and interest. The arbitration award was handed down on 30 October
2006 wherein the distributor’s claim against the subsidiary company was dismissed. The distributor
has filed an action in court to set aside the arbitration award. The subsidiary company has obtained
legal advice that it is probable that such an action will not be successful.
(c) A subsidiary company had issued a notice of termination of an associated company on 11 July 2006
to the subsidiary company’s joint venture partner (‘Respondent’). The subsidiary company’s joint
venture partner is disputing the termination. The amount claimed cannot be quantified due to
the nature of damages being claimed which can only be ascertained from evidence produced during
the arbitration process. According to the Joint Venture Contract (‘JV Contract’), disputes must be
referred to arbitration. The subsidiary company filed the Statement of Case with the Singapore
International Arbitration Centre on 31 January 2008. The Respondent subsequently produced a
Memorandum allegedly signed by the subsidiary company and the Respondent dated the same
date as the JV Contract which allegedly states that the forum for settling of disputes should be the
Chinese courts and not arbitration. The subsidiary company maintains that the Memorandum is
a forgery. The arbitration tribunal has stated that it has jurisdiction to hear the matter challenging
its jurisdiction and this will be by way of a full hearing involving witnesses and evidence.
On 5 May 2009, the subsidiary company had obtained an injunction to stop the Respondent
from continuing proceedings at the Chinese courts and submit itself to arbitration. The arbitration
tribunal has ordered that:
(i) it has jurisdiction to hear and decide the Respondent’s challenge over the arbitration and the
claim that a Chinese court should have jurisdiction over the arbitration and/or the matter raised
is rejected; and

(ii) it has jurisdiction over this arbitration and all matters submitted under the dispute resolution
provision stated in the JV Contract, which includes but is not limited to the subsidiary company’s
claims under the notice of arbitration, and therefore the Respondent’s claim that this arbitration
should be terminated or suspended is rejected.
On 9 June 2009, the arbitration tribunal has further ordered that the Respondent shall pay the
subsidiary company all its legal costs relating to the jurisdiction proceedings, amounting to
Singapore Dollar 424,058 (RM1,020,000).
On 25 June 2009, the subsidiary company’s counsel in China has also entered a conditional
appearance and filed its objection with the Dongguan Court in China.
The arbitration tribunal will now proceed with the substantive hearing to decide on the termination
of the JV Contract.

43 CONTINGENT LIABILITIES (CONTINUED)

(d) A vendor has commenced arbitration proceedings against two subsidiary companies. The claim
against one subsidiary company amounts to RM19.3 million and against the other subsidiary
company is for RM14.2 million. Both parties are in the midst of exchanging points of claims and
defences which will be followed by the exchange of documents in support of such claims and
defences. The Directors are of the opinion, based on legal advice, that the claims have no merits and
are unlikely to succeed.
44 CASH AND CASH EQUIVALENTS

Group Company
2009 2008 2009 2008
RM’000 RM’000 RM’000 RM’000
Short term funds deposited with

licensed banks 717,221 1,062,834 208,955 25,920
Bank and cash balances 196,629 163,176 468 376
Deposits, bank and cash balances 913,850 1,226,010 209,423 26,296
Bank overdrafts (Note 38) - (6,728) - -

Bank balance in respect
of ADF (Note 32(d)) (14,467) (45,343) - -
899,383 1,173,939 209,423 26,296
45 FINANCIAL INSTRUMENTS
(a) Financial risk management objectives and policies
The Group’s activities are exposed to a variety of financial risks, including foreign currency exchange
risk, interest rate risk, market risk, credit risk, liquidity and cash flow risk. The Group focuses on
the unpredictability of financial markets and seeks to minimise potential adverse effects on the
financial performance of the Group. Financial risk management is carried out through risks reviews,
internal control systems, a comprehensive insurance programme and adherence to Group financial
risk management policies. The Board regularly reviews these risks and approves the treasury policies,
which covers the management of these risks.
The Group uses derivative financial instruments such as foreign exchange contracts and interest
rate instruments to hedge certain exposures. It does not trade in financial instruments.
(i) Foreign currency exchange risk
The Group is exposed to currency risk as a result of the foreign currency transactions entered
into by the Company and subsidiary companies in currencies other than their functional
currency. The Group enters into forward foreign currency exchange contracts to limit the
exposure on foreign currency receivables and payables, and on cash flows arising from
anticipated transactions denominated in foreign currencies.
274
45 FINANCIAL INSTRUMENTS (CONTINUED)
(a) Financial risk management objectives and policies (continued)
(ii) Interest rate risk
The Group’s income and operating cash flows are not substantially affected by changes in
market interest rates except for interest from bank deposits. Derivative financial instruments
are used, where appropriate, to generate the desired interest rate profile.
(iii) Market risk
The Group does not face significant exposure from the risk from changes in debt and equity
prices.
(iv) Credit risk
The Group seeks to invest cash assets safely and profitably. The Group considers the risk of
material loss in the event of non-performance by a financial institution to be unlikely in view
of the financial strength of those counter-parties.
The Group seeks to control customers credit risk by ensuring that significant sales of vehicles
and provision of services are made to customers with an appropriate credit history.
(v) Liquidity and cash flow risk
Prudent liquidity risk management implies maintaining sufficient cash, the availability of
funding through an adequate amount of committed credit facilities and the ability to close out
market positions.
(b) Forward foreign exchange contracts
Forward foreign exchange contracts are entered into by the Group in currencies other than
the functional currency to manage exposure to fluctuations in foreign currency exchange rates on
specific transactions.

(b) Forward foreign exchange contracts (continued)
As at 31 March 2009, the outstanding notional principal amounts of the Group foreign exchange
contracts are as follows:
Group
2009 2008
RM’000 RM’000
Maturity
Less than 6 months 38,343 47,793

Between 6 months and 1 year - 8,820
38,343 56,613
The foreign currency amounts to be received and the contractual exchange rates of the Group‘s
outstanding contracts are as follows:
Currency Currency Average

to be to be RM’000 contracted
Hedged item received paid equivalent rate
2009
Group
Forecasted receivables
- the following 6 months JPY RM 1,907 1 RM = JPY 26.705
GBP USD 21,956 1 USD = GBP 1.6567
GBP EURO 14,480 1 EURO = GBP 1.1746

38,343
2008
Group
Forecasted receivables
- the following 6 months GBP USD 47,793 1 USD = GBP 1.9448
- 6 to 12 months GBP USD 8,820 1 USD = GBP 1.9344
56,613
276

(c) Fair values
The carrying amounts of financial assets and liabilities of the Group and Company at the balance
sheet date approximated their fair values except as set out below:
Group Company
Carrying Carrying
amount Fair value amount Fair value
Note RM’000 RM’000 RM’000 RM’000
2009
Recognised on the
balance sheet
Amounts due from

subsidiary companies 20 - - 177,870 138,284
Investments - unquoted 21 10,397 17,618 6,475 17,618
- quoted 27 584 724 - -
- unquoted 27 14,729 14,729 - -
Lease and hire purchase
creditor - long term portion 32 (2,537) (2,256) - -
ADF liability 32(d) (14,467) (14,203) - -
Long term loan 32 (52,225) (46,053) - -
Off balance sheet
Forward foreign exchange

contracts 45(b) 38,343 38,218 - -

(c) Fair values (continued)
Group Company
Carrying Carrying
amount Fair value amount Fair value
Note RM’000 RM’000 RM’000 RM’000
2008
Recognised on the
balance sheet
Investments - unquoted 21 10,397 15,067 6,475 15,067

- quoted 27 526 806 - -
- unquoted 27 20,296 20,296 - -
Advance - Government
loan facility 32 (47,879) (47,879) - -
Lease and hire purchase
creditor - long term portion 32 (4,151) (3,860) - -
ADF liability 32(d) (45,343) (43,683) - -
Long term loan 32 (83,005) (68,647) - -
Off balance sheet
Forward foreign exchange

contracts 45(b) 56,613 57,078 - -
278
46 SUBSEQUENT EVENTS
(a) On 8 May 2009, the Company announced that its wholly owned subsidiary, Proton Edar Sdn. Bhd.
(‘PESB’) had signed a Master Dealership Agreement with Edaran Otomobil Nasional Berhad (‘EON’)
(‘the Agreement’), for the purpose of rationalising the sales and distribution network between
PESB and EON with the objective of improving, developing and strengthening the Distribution and
Service Dealer Network as well as, allowing parties to rationalise and achieve the cost reduction
objectives (‘Proposed Rationalisation’).
Under the terms of the Agreement, PESB agreed to appoint EON as a sales and service dealer for
PESB on a non-exclusive basis pursuant to the terms and conditions of the Agreement and of other
related agreements to be entered in by parties.
The execution of a Sales Operations Agreement and a Service Operations Agreement shall be
finalised and executed on or before 30 June 2009 or such other extended period to be agreed upon
by parties, failing which the Agreement shall lapse and be of no further effect.
The Company announced on 1 July 2009 that the following agreements have been signed:
(i) Sales Operations Agreement
PESB has appointed EON to undertake the promotion and sale of the Company vehicles and
products on a non-exclusive basis within Malaysia for a period of 5 years beginning 1 July
2009, and
(ii) Service Operations Agreement
PESB has appointed EON to undertake the service and sales of parts/spare parts to customers
on a non-exclusive basis within Malaysia for a period of 5 years beginning 1 July 2009.
(b) On 29 May 2009, the Liquidator of Proton Capital Sdn. Bhd. (‘Proton Capital’) had convened and
lodged a return relating to final meeting with the Companies Commission of Malaysia and the
Official Receiver. On the expiration of three months from 29 May 2009, Proton Capital will be
dissolved.
47 APPROVAL OF FINANCIAL STATEMENTS
The financial statements have been approved for issue in accordance with a resolution of the Board
of Directors on 22 July 2009.

STATEMENT BY DIRECTORS PURSUANT TO
SECTION 169(15) OF THE COMPANIES ACT, 1965
We, Dato’ Mohd Nadzmi bin Mohd Salleh and Dato’ Syed Zainal Abidin B Syed Mohamed Tahir, two of the
Directors of Proton Holdings Berhad, state that, in the opinion of the Directors, the financial statements
set out on pages 185 to 279 are drawn up so as to give a true and fair view of the state of affairs of the
Group and Company as at 31 March 2009 and of the results and cash flows of the Group and Company for
the financial year ended on that date in accordance with the provisions of the Companies Act, 1965 and
MASB Approved Accounting Standards in Malaysia for Entities Other Than Private Entities.
Signed on behalf of the Board of Directors in accordance with their resolution dated 22 July 2009.
DATO’ MOHD NADZMI BIN MOHD SALLEH DATO’ SYED ZAINAL ABIDIN B SYED MOHAMED TAHIR
CHAIRMAN MANAGING DIRECTOR
STATUTORY DECLARATION PURSUANT TO

SECTION 169(16) OF THE COMPANIES ACT, 1965
I, Vimala a/p V.R. Menon, the officer primarily responsible for the financial management of Proton Holdings
Berhad, do solemnly and sincerely declare that the financial statements set out on pages 185 to 279 are, in
my opinion, correct and I make this solemn declaration conscientiously believing the same to be true, and
by virtue of the provisions of the Statutory Declarations Act, 1960.
VIMALA A/P V.R. MENON
Subscribed and solemnly declared by the abovenamed Vimala a/p V.R. Menon at Shah Alam in Malaysia
on 22 July 2009, before me.
COMMISSIONER FOR OATHS
280
INDEPENDENT AUDITORS REPORT TO THE MEMBERS OF
PROTON HOLDINGS BERHAD
(Incorporated in Malaysia) (Company No. 623177-A)
We have audited the financial statements of Proton Holdings Berhad, which comprise the balance sheets
as at 31 March 2009 of the Group and Company, and the income statements, statements of changes in
equity and cash flow statements of the Group and Company for the year then ended, and a summary of
significant accounting policies and other explanatory notes, as set out on pages 185 to 279.
Directors’ Responsibility for the Financial Statements
The Directors of the Company are responsible for the preparation and fair presentation of these financial
statements in accordance with MASB Approved Accounting Standards in Malaysia for Entities Other than
Private Entities and the Companies Act, 1965. This responsibility includes: designing, implementing and
maintaining internal control relevant to the preparation and fair presentation of financial statements that
are free from material misstatement, whether due to fraud or error; selecting and applying appropriate
accounting policies; and making accounting estimates that are reasonable in the circumstances.
Auditors’ Responsibility
Our responsibility is to express an opinion on these financial statements based on our audit. We conducted
our audit in accordance with approved standards on auditing in Malaysia. Those standards require that
we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance
whether the financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in
the financial statements. The procedures selected depend on our judgement, including the assessment of
risks of material misstatement of the financial statements, whether due to fraud or error. In making those
risk assessments, we consider internal control relevant to the entity’s preparation and fair presentation
of the financial statements in order to design audit procedures that are appropriate in the circumstances,
but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. An
audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of
accounting estimates made by the Directors, as well as evaluating the overall presentation of the financial
statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for
our audit opinion.
Opinion
In our opinion, the financial statements have been properly drawn up in accordance with MASB Approved
Accounting Standards in Malaysia for Entities Other than Private Entities and the Companies Act, 1965 so
as to give a true and fair view of the financial position of the Group and Company as of 31 March 2009
and of their financial performance and cash flows for the year then ended.

INDEPENDENT AUDITORS REPORT TO THE MEMBERS OF
PROTON HOLDINGS BERHAD (CONTINUED)
(Incorporated in Malaysia) (Company No. 623177-A)
REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS
In accordance with the requirements of the Companies Act, 1965 in Malaysia, we also report the
following:
(a) In our opinion, the accounting and other records and the registers required by the Act to be kept
by the Company and its subsidiaries of which we have acted as auditors have been properly
kept in accordance with the provisions of the Act.
(b) We have considered the financial statements and the auditors’ reports of all the subsidiaries
of which we have not acted as auditors, which are indicated in Note 17 to the financial statements.
(c) We are satisfied that the financial statements of the subsidiaries that have been consolidated
with the Company’s financial statements are in form and content appropriate and proper for the
purposes of the preparation of the financial statements of the Group and we have received
satisfactory information and explanations required by us for those purposes.
(d) The audit reports on the financial statements of the subsidiaries did not contain any qualification
or any adverse comment made under Section 174(3) of the Act.
OTHER MATTERS
This report is made solely to the members of the Company, as a body, in accordance with Section 174 of
the Companies Act, 1965 in Malaysia and for no other purpose. We do not assume responsibility to any
other person for the content of this report.
PRICEWATERHOUSECOOPERS THAYAPARAN A/L S. SANGARAPILLAI

(No. AF: 1146) (No. 2085/09/10 (J))
Chartered Accountants Chartered Accountant
Kuala Lumpur
22 July 2009
282
SHAREHOLDING STATISTICS AS AT 30 JUNE 2009
Analysis of Shareholdings
Share Capital
Authorised Share Capital Issued and Fully Paid Up Capital RM1,000,000,000/-
Issued and Fully Paid Up Capital RM549,213,002/-
Class of Shares Ordinary Shares of RM1/- each
Voting Rights One (1) Voting Right for one (1) Ordinary Share
Analysis of Shareholdings by Range Groups

No. of No. of No.of % of
Shareholders/ Shareholders/ Shares/ Issued
Depositors Depositors Securities Capital
1 - 99 95 1.1135 1,362 0.0002

100 - 1,000 4,195 49.1678 3,896,064 0.7094
1,001 - 10,000 3,534 41.4205 13,748,546 2.5033
10,001 - 100,000 578 6.7745 17,489,120 3.1844
100,001 - 27,460,649 127 1.4885 148,919,537 27.1151
27,460,650 and above 3 0.0352 365,158,373 66.4876
Total 8,532 100.0000 549,213,002 100.0000
Distributions of Shareholdings
Malaysian Malaysian Malaysian Malaysian Foreign Foreign Foreign Foreign
No. of % of No. of % of No. of % of No. of % of
Shareholders/ Shareholders/ Shares Issued Shareholders/ Shareholders/ Shares Issued
Depositors Depositors Held Capital Depositors Depositors Held Capital
Size of Holdings
1 - 99 92 1.0783 1,298 0.0002 3 0.0352 64 0.0000
100 - 1,000 4,148 48.6170 3,852,264 0.7014 47 0.5509 43,800 0.0080
1,001 - 10,000 3,459 40.5415 13,461,946 2.4511 75 0.8790 286,600 0.0522
10,001 - 100,000 525 6.1533 15,586,621 2.8380 53 0.6212 1,902,499 0.3464
100,001 - 27,460,649 84 0.9845 107,117,101 19.5037 43 0.5040 41,802,436 7.6113
27,460,650 and above 2 0.0234 322,037,693 58.6362 1 0.0117 43,120,680 7.8514
Total 8,310 97.3980 462,056,923 84.1307 222 2.6020 87,156,079 15.8693
Substantial Shareholders
No. CDS Account No Name Normal Holdings
Holdings Percentage
1 087-001-014418354 Khazanah Nasional Berhad 234,734,693 42.7402
2 226-001-004488797 Employees Provident Fund Board 87,303,000 15.8960
3 209-001-044650448 Cartaban Nominees (Tempatan) Sdn Bhd

Petroliam Nasional Berhad (Strategic Inv) 43,120,680 7.8514

SHAREHOLDING STATISTICS AS AT 30 JUNE 2009 (CONTINUED)
Thirty Largest Shareholders
NO. CDS ACCOUNT NO NAME IC/ID NO. NORMAL HOLDINGS

HOLDINGS PERCENTAGE
1 087-001-014418354 KHAZANAH NASIONAL BERHAD 275505K 234,734,693 42.7402
2 226-001-004488797 EMPLOYEES PROVIDENT FUND BOARD EPFACT1991 87,303,000 15.8960
3 209-001-044650448 CARTABAN NOMINEES (TEMPATAN) SDN BHD

PETROLIAM NASIONAL BERHAD (STRATEGIC INV) 263368K 43,120,680 7.8514
4 258-001-037482247 LEMBAGA TABUNG HAJI ACT5351995 16,820,427 3.0626
5 245-001-019638741 AMANAH RAYA NOMINEES (TEMPATAN)

SDN BHD SKIM AMANAH SAHAM BUMIPUTERA 434217U 16,270,400 2.9625
6 201-001-008776270 MAYBAN NOMINEES (TEMPATAN) SDN BHD

MAYBAN TRUSTEES BERHAD FOR PUBLIC
REGULAR SAVINGS FUND (N14011940100 ) 258939H 11,894,400 2.1657
7 206-001-048735070 HSBC NOMINEES (ASING) SDN BHD

EXEMPT AN FOR THE BANK OF
NEW YORK MELLON (MELLON ACCT) 4381U 11,757,710 2.1408
8 257-001-037151271 VALUECAP SDN BHD 595989V 10,150,000 1.8481

TNTC FOR BRANDES INSTITUTIONAL EQUITY TRUST 4381U 3,823,100 0.6961
10 207-001-034438135 CITIGROUP NOMINEES (ASING) SDN BHD

CBNY FOR DFA EMERGING MARKETS FUND 263875D 3,581,500 0.6521

EXEMPT ANFOR JPMORGAN CHASE BANK,
NATIONAL ASSOCIATION (U.S.A.) 4381U 2,855,375 0.5199

MAYBAN TRUSTEES BERHAD FOR PUBLIC
AGGRESSIVE GROWTH FUND (N14011940110) 258939H 2,828,000 0.5149

BNY BRUSSELS FOR QUEENSLAND INVESTMENT
CORPORATION 4381U 2,800,000 0.5098
14 222-001-040942609 ALLIANCEGROUP NOMINEES

(TEMPATAN) SDN BHD
ALLIANCE INVESTMENT MANAGEMENT BERHAD
FOR EMPLOYEES PROVIDENT FUND 42234H 2,545,900 0.4636
15 245-001-031302672 AMANAH RAYA NOMINEES

(TEMPATAN) SDN BHD
AMANAH SAHAM MALAYSIA 434217U 2,449,300 0.4460

(TEMPATAN) SDN BHD
PUBLIC SECTOR SELECT FUND 434217U 2,349,400 0.4278
284
SHAREHOLDING STATISTICS AS AT 30 JUNE 2009 (CONTINUED)
Thirty Largest Shareholders (continued)
NO. CDS ACCOUNT NO NAME IC/ID NO. NORMAL HOLDINGS

HOLDINGS PERCENTAGE

MAYBAN TRUSTEES BERHAD FOR PUBLIC BALANCED
FUND (N14011950210 ) 258939H 2,265,000 0.4124

(TEMPATAN) SDN BHD
PUBLIC SMALLCAP FUND 434217U 2,069,700 0.3768
19 076-001-032786725 BANK SIMPANAN NASIONAL BSNACT1461974 1,933,000 0.3520
23 209-001-021330287 CARTABAN NOMINEES (ASING) SDN BHD

GOVERNMENT OF SINGAPORE INVESTMENT
CORPORATION PTE LTD FOR GOVERNMENT
OF SINGAPORE (C) 263367W 1,756,800 0.3199
24 206-001-022024434 HSBC NOMINEES (TEMPATAN) SDN BHD

NOMURA ASSET MGMT MALAYSIA FOR
EMPLOYEES PROVIDENT FUND 258854D 1,695,000 0.3086
25 087-001-002671394 KUMPULAN WANG SIMPANAN PEKERJA ACT425 1,500,000 0.2731

EXEMPT AN FOR BGL (OPCVM A/C) 4381U 1,435,775 0.2614

EXEMPT AN FOR JPMORGAN CHASE BANK,
NATIONAL ASSOCIATION (AUSTRALIA) 4381U 1,386,600 0.2525

TNTC FOR UTAH STATE RETIREMENT SYSTEMS 4381U 1,327,976 0.2418
29 053-001-046800884 KAF TRUSTEE BERHAD KAF FUND

MANAGEMENT SDN BHD FOR KAF SEAGROATT
& CAMPBELL BERHAD 648477U 1,200,000 0.2185

(TEMPATAN) SDN BHD
PUBLIC GROWTH FUND 434217U 1,179,000 0.2147
TOTAL 478,595,336 87.14

PROPERTIES OWNED BY PROTON GROUP AS AT 31 MARCH 2009
Properties Owned by Perusahaan Otomobil Sdn Bhd (PONSB)
Location Description Tenure Date of Age of Age of Net Book Value (RM’Mil)
Acquisition Building Building
/Revaluation
2008 2009 2008 2009
No. H.S. (D)71311, Land with an area of Freehold 05.09.1983 23 Years 24 Years Land 68.4 68.4
No. P.T.82 Mukim of 6,231,080 sq. ft. with Buildings 129.8 113.0
Damansara, District main office, main
of Petaling, Selangor factory, engine factory,
Darul Ehsan. (Formerly, medium volume factory,
HICOM Industrial Estate canteen buildings,
encompassing part of sports facilities, car park
Lots 563, 564, 568, 570 for production cars
and Lot 15, Mukim of and additional R&D
Damansara, District of laboratories building.
Petaling, Selangor Darul Total built-up area is
Ehsan). 2,594,603 sq. ft.
HICOM Industrial Estate 3 units of flats currently Freehold 09.04.1986 23 Years 24 Years Flats 0.04 0.04
encompassing Lot 572, rented out.
Mukim of Damansara,
District of Petaling,
Selangor Darul Ehsan.
No. H.S. (D) 71309, Land with an area of Freehold 19.11.1993 - - Land 2.6 2.6
No. P.T. 80, Mukim of 158,107 sq. ft. used as
Damansara, District the car park for staff.
of Petaling, Selangor
Darul Ehsan. (Formerly,
HICOM Industrial
Estate encompassing
Lot 568 Grant No.
5941,H.S.(D) 22208 No.
P.T. 5115,H.S.(D) 22207,
No. P.T.5116, Mukim of
Damansara, District of
Petaling, Selangor Darul
Ehsan).
286
PROPERTIES OWNED BY PROTON GROUP AS AT 31 MARCH 2009 (CONTINUED)
Properties Owned by Perusahaan Otomobil Sdn Bhd (PONSB) (continued)
/Revaluation
2008 2009 2008 2009
Geran 215214, Land with an area of Freehold 30.12.1992 14 Years 15 Years Land 20.5 21.2
Lot 61821, HICOM 1,036,728 sq. ft. with Buildings 39.8 36.8
Glenmarie Industrial office, factory and
Park, Mukim of canteen buildings and
Damansara, District of sports facilities used for
Petaling, Selangor Darul the Casting Plant. Total
Ehsan. built-up area is 194,579
sq. ft.
No. H.S. (D) 86554, No. Land with an area Freehold 18.04.1994 14 Years 15 Years Land 54.9 54.9
P.T. 257 encompassing of 2,396,727 sq. ft. Track & 20.3 13.0
Lot 54, 60 and 62, Sime adjoining the Company’s Buildings
UEP Industrial Park, northern boundary
Mukim of Damansara, housing the semi-
District of Petaling, high speed test track
Selangor Darul Ehsan. and control building.
Total built-up area is
2,102,731 sq. ft.
No. H.S. (D) B.P.5653 and Land with an area of Freehold 03.02.1999 5 Years 6 Years Land 1.0 1.0
5654 Bil P.T. 16162 and 55,440,519 sq. ft. for the Building 454.3 436.1
10163, District of Batang construction of a second
Padang, Mukim of Ulu automobile plant,
Bernam Timur, Perak administrative building
Darul Ridzwan. and sports complex
facilities. Total built-up
area is 3,374,577 sq.ft.

Properties Owned by Proton Edar Sdn Bhd (PESB)
/Revaluation
2008 2009 2008 2009
Vehicle Preparation Vehicle Preparation Freehold 01.12.2000 6 Years 7 Years Building 4.5 4.2
Centre (VPC) No H.S. Centre and stock
(D) 86555, PT No. 258 control building with
and H.S. (D) 86557, total built-up area of
PT No.260, TP 5 Road, 101,956 sq. ft.
Sime UEP Industrial
Park, 47600 Subang
Jaya,Selangor Darul
Ehsan.
Centre of Excellence Land with area of Freehold 01.03.2001 7 Years 8 Years Land 35.7 35.7
(COE) & Pre-Delivery and 465,185 sq. ft. and Building 127.4 120.6
Inspection Centre (PDI) Administration &
No H.S. (D) 86596, PT No. Operation Office
299 and H.S. (D) 86597, and Pre-Delivery &
PT No. 300, TP 5 Road, Inspection Centre
Sime UEP Industrial Park, with total built-up
47600 Subang Jaya, area of 422,943 sq. ft.
No. 2, Lrg. Samarinda 3 storey shop units Freehold 10.05.2002 5 Years 6 Years Building 0.6 0.6
6A, Off Jalan Kebun, H.S which approximately
(D) 60042, P.T.No. 64566 2,475.7 sq. ft.
Mukim, Klang, Selangor
Darul Ehsan.
Lot 859, Block 16 Land with an area of Freehold 29.04.2002 6 Years 7 Years Land 2.8 2.8
Kuching Central Land 50,570 sq. ft. to be 27.11.2007 - 1 Year Building - 6.9
District, Stampin 4 1/2 used for sales outlet
Mile, Penrissen Road, and service centre.
Kuching, Sarawak.
H.S. (D) 351587, Land with an area of Freehold 29.04.2002 6 Years 7 Years Land 8.4 8.1
PTD 173042, Mukim 87,120 sq. ft. to be Building 6.4 6.1
Plentong, Daerah Johor used for sales outlet
Bahru, Johor. and service centre.
288
Properties Owned by Proton Edar Sdn Bhd (PESB)(continued)
/Revaluation
2008 2009 2008 2009
H.S. (D) 63313, P.T.No. Land with an area Freehold 19.07.2002 5 Years 6 Years Land 3.1 3.1
9671 Mukim of of 79,949 sq. ft. used 29.09.2003 3 Years 4 Years Building 2.7 2.5
Ampangan, District for sales outlet and
of Seremban, Negeri service centre is 7,175
Sembilan. sq. ft.
H.S. (D) 318392, PTD Land with an area of Freehold 06.08.2002 5 Years 6 Years Land 5.1 5.1
81816, Mukim of Pulai, 57,267 sq. ft. to be
District of Johor Bahru. used for sales outlet
and service centre.
H.S. (M) 212, PT 4352, Land with an area of Freehold 13.09.2002 5 Years 6 Years Land 1.4 1.4
Mukim Kuah, District of 51,979 sq. ft. to be
Langkawi, Kedah. used for sales outlet
and service centre.
H.S. (D) 144330, PT Land with an area of Freehold 02.09.2002 5 Years 6 Years Land 9.6 9.6
40019 Mukim of Sungai 61,524 sq. ft. to be 01.03.2004 3 Years 4 Years Building 6.2 5.9
Buloh, District of used for sales outlet
Petaling, Selangor Darul and service centre.
Ehsan.
No H.S. (D) 86599, PT Land with an area Freehold 05.12.2005 2 Years 3 Years Land 5.8 5.8
No. 302, TP 5 Road, Sime of 123,853 sq. ft. to
UEP Industrial Park, be used for
47600 Subang Jaya, stockyard area.
L&D Tanjung Malim, Administration & Freehold 31.07.2007 - 1 Year Building - 4.7
Proton Edar Sdn Bhd, c/o Operation Office.
Proton Tanjung Malim
Sdn Bhd, Proton City,
35900 Tanjung Malim,
Perak.

Properties Owned by Proton Cars (UK) Ltd (PCUK)
/Revaluation
2008 2009 2008 2009
Ref. AV 915, Units Land with an area of Freehold 31.03.1994 32 Years 33 Years Land 6.5 5.3
1-3, Crawley Way, 162,479 sq. ft. with Buildings 1.9 1.6
Avonmouth, Bristol a parts warehouse
Avon BS11 9YR, England building.
Properties Owned by Group Lotus Plc
Potash Lane, Hethel, R&D building rented to Freehold 01.03.2000 9 Years 10 Years Building 12.3 9.7
Norwich, Norfolk NR14 group companies. Total
8EZ, England. built-up area is 86,600
sq.ft.
Properties Owned by Lotus Cars Ltd

Land adjacent to Two parcels of land Freehold 26.09.1968 41 Years 42 Years Land 6.1 5.2
Potash Lane, Hethel, with a total area of Building 74.5 59.0
Norwich, Norfolk 6,286,550 sq. ft. with
NR 14 8EZ, England the factory, engineering
and facilities, offices and test
Land north of Browic. track of Lotus Group
International Ltd. Total
built-up area is 515,500
sq. ft.
290
Properties Owned by PT Proton Cikarang Indonesia (PCI)
/Revaluation
2008 2009 2008 2009
Hak Guna Bangunan Combined land area Leasehold 21.09.2004 13 Years 14 Years Land 15.6 14.1
No. 353, 596, 597, Desa of 136,610 sq. meters (Expiry: Building 11.7 9.9
Sukaresmi, Kecamatan was erected with 24.09.2025,
Lemahabang, factories, office, 2021 and
Kabupaten Bekasi, West canteen, warehouse, 2023)
Java, Indonesia. utility and security
facilities.
Properties Owned by Lotus Holdings Inc

1254 North Main St, Ann Land with an area of Freehold 24.02.2000 Office: Office: Land 0.8 0.7
Arbor, Michigan, USA. approximately 165,528 88 Years 89 Years Building 8.7 6.7
sq. ft. with office and
workshop. Total built-up Workshop: Workshop:
area is 73,000 sq. ft. 42 Years 43 Years

Share Price and Volume Traded
Share
Price (RM)
Volume
4.50
8,000,000
4.00
7,000,000
3.50
6,000,000
3.00
5,000,000
2.50
4,000,000
2.00
3,000,000
1.50
2,000,000
1.00
0.50 1,000,000
0.00 0
Apr 08 May Jun Jul Aug Sep Oct Nov Dec Jan 09 Feb Mar
Share Price Volume
292
Notice of Annual General Meeting
NOTICE IS HEREBY GIVEN that the Sixth (6th) Annual General Meeting
of the Company will be held at the Auditorium, PROTON Centre of
Excellence, KM 33.8, Westbound Shah Alam Expressway, 47600 Subang
Jaya, Selangor Darul Ehsan, Malaysia on Friday, 21 August 2009 at 3.00pm
for the following purposes:
1. To lay the Report of the Directors and Auditors and the Audited Statement of Accounts for the year
ended 31 March 2009.

2. To elect the following Directors who retire in accordance with the Company’s Articles of Association:-
Article 104
(i) Tuan Haji Abdul Kadir Bin Md Kassim Ordinary Resolution 1
(ii) Dato’ Michael Lim Heen Peok Ordinary Resolution 2
(iii) Tuan Haji Abdul Jabbar Bin Abdul Majid* -
*Note: Tuan Haji Abdul Jabbar Bin Abdul Majid, although eligible, does not seek re-election.
Article 111
(i) Dato’ Mohd Nadzmi Bin Mohd Salleh Ordinary Resolution 3
(ii) Encik Oh Kim Sun Ordinary Resolution 4
3. To approve the Directors’ fees for the year ended 31 March 2009. Ordinary Resolution 5

4. To re-appoint Messrs PricewaterhouseCoopers as Auditors of the Ordinary Resolution 6
Company and to authorise the Directors to fix their
remuneration.

5. To transact any other ordinary business for which due notice has Ordinary Resolution 7
been given.
By Order of the Board
MOHD NIZAMUDDIN BIN MOKHTAR (LS NO. 006128)

Company Secretary
Subang Jaya, Selangor Darul Ehsan
30 July 2009

NOTES
1. A member of the Company entitled to attend and vote at the Meeting is entitled to appoint one or
more proxies to attend and vote in his stead. A proxy may but need not be a member of the Company
and the provision of Section 149(1)(b) of the Companies Act, 1965, shall not apply.
2. The instrument appointing a proxy must be in writing under the hands of the appointer or his
attorney duly authorised in writing or, if such appointer is a corporation, under its common seal or
the hand of an officer or attorney duly authorised. If the Form of Proxy is signed under the hand of
an officer duly authorised, it should be accompanied by a statement reading “signed as authorised
officer under Authorisation Document which is still in force, no notice of revocation having been
received”. If the Form of Proxy is signed under the attorney duly authorised, it should be accompanied
by a statement reading “signed under Power of Attorney which is still in force, no notice of
revocation having been received”. A copy of the Authorisation Document or the Power of Attorney,
which should be valid in accordance with the laws of the jurisdiction in which it was created and is
exercised, should be enclosed.
3. The maximum number of proxies that may be appointed is two. Where a member appoints more than
one proxy, the appointment shall be invalid unless he specifies the proportion of his shareholdings to
be represented by each proxy.
4. Where a member of the Company is an authorised nominee as defined under the Securities Industry
(Central Depositories) Act, 1991, it may appoint at least one proxy in respect of each securities account
it holds with ordinary shares of the Company standing to the credit of the said securities account.
Every appointment submitted by an authorised nominee as defined under the Securities Industry
(Central Depositories) Act, 1991, must specify the CDS Account Number.
5. The instrument appointing the proxy must be deposited at the office of the Registrar, Tenaga Koperat
Sdn Bhd, Level 17, The Gardens North Tower, Mid Valley City, Lingkaran Syed Putra, 59200 Kuala
Lumpur not less than forty eight (48) hours before the time appointed for the meeting.
6. For the purpose of determining a member who shall be entitled to attend the Meeting, the Company
shall be requesting Bursa Malaysia Depository Sdn Bhd, in accordance with Article 67(b) of the
Company’s Articles of Association and Section 34(1) of the Securities Industry (Central Depositories)
Act, 1991, to issue a General Meeting Record of Depositors as at 13 August 2009. Only a depositor
whose name appears on the General Meeting Record of Depositors as at 13 August 2009 shall be
entitled to attend the said meeting or appoint proxies to attend and/or vote in his stead.
294
Statement Accompanying the Notice of
Sixth (6th) Annual General Meeting
Pursuant to Paragraph 8.28(2) of the Listing Requirements of Bursa
Malaysia Securities Berhad, appended hereunder are:
DIRECTORS STANDING FOR RE-ELECTION
Directors who are standing for re-election at the Sixth (6th) Annual General Meeting of the Company which
will be held at The Auditorium, PROTON Centre of Excellence, KM 33.8, Westbound Shah Alam Expressway,
47600 Subang Jaya, Selangor Darul Ehsan, Malaysia on Friday, 21 August 2009 at 3.00pm pursuant to the
Company’s Articles of Association.
Article 104
(i) Tuan Haji Abdul Kadir Bin Md Kassim Refer to page 32 of the Annual Report
(ii) Dato’ Michael Lim Heen Peok Refer to page 33 of the Annual Report
(iii) Tuan Haji Abdul Jabbar Bin Abdul Majid* Refer to page 31 of the Annual Report
*Note: Tuan Haji Abdul Jabbar Bin Abdul Majid, although eligible, does not seek re-election.
Article 111
(i) Dato’ Mohd Nadzmi Bin Mohd Salleh Refer to page 28 of the Annual Report
(ii) Encik Oh Kim Sun Refer to page 35 of the Annual Report

This page is intentionally left blank.
PROTON ANNUAL REPORT 2009
Success. Challenges. Responsibility.
PROTON Holdings Berhad (Company No.623177-A)
FORM OF PROXY No. of Shares Held
CDS Account No. of Authorised Nominee
I/We (name of shareholder, in capital letters)
NRIC No. (new) (old) ID No./Company No.
of (full address) being a member of PROTON Holdings
Berhad, hereby appoint (name of proxy as per NRIC, in capital letters)
NRIC No. (new) (old) or failing him/her
(name of proxy as per NRIC, in capital letters) NRIC No. (new) (old) or failing him/her, the
CHAIRMAN OF THE MEETING as my/our proxy to vote for me/us on my/our behalf at the Sixth (6th) Annual General Meeting of the Company
to be held at The Auditorium, Level 1, PROTON Centre of Excellence, KM 33.8, Westbound Shah Alam Expressway, 47600 Subang Jaya,
Selangor Darul Ehsan, Malaysia, on Friday, 21 August 2009 at 3.00pm and at any adjournment thereof.
My/Our proxy is to vote as indicated below:-
ORDINARY RESOLUTIONS FOR AGAINST

1. To lay the Report of the Directors and Auditors and the Audited Statement of Accounts for the year
ended 31 March 2009.
2. To elect the following Directors who retire in accordance with the Company’s Articles of Association:-
Article 104
(i) Tuan Haji Abdul Kadir Bin Md Kassim Ordinary Resolution 1
(ii) Dato’ Michael Lim Heen Peok Ordinary Resolution 2
(iii) Tuan Haji Abdul Jabbar Bin Abdul Majid* -
*Note: Tuan Haji Abdul Jabbar Bin Abdul Majid, although eligible, does
not seek re-election.
Article 111
(i) Dato’ Mohd Nadzmi Bin Mohd Salleh Ordinary Resolution 3
(ii) Encik Oh Kim Sun Ordinary Resolution 4
3. To approve the Directors’ fees for the year ended 31 March 2009. Ordinary Resolution 5
4. To re-appoint Messrs PricewaterhouseCoopers as Auditors of the Ordinary Resolution 6

Company and to authorise the Directors to fix their remuneration.
5. To transact any other ordinary business for which due notice has been Ordinary Resolution 7
given.
(Please indicate with an “X” in the spaces provided how you wish your vote to be cast. If you do not do so, the proxy will vote or
abstain from voting at his/her discretion.)
Dated this day of 2009. For appointment of more than one proxy, state number of shares
and percentage of shareholdings to be represented by the proxies:-
No. of Shares Percentage
Proxy 1 %
Proxy 2 %
Signature/Common Seal of Appointer
P.T.O
✂
NOTES:
1. A member of the Company entitled to attend and vote at the Meeting is entitled to appoint one or more proxies to attend and vote in his stead. A proxy may
but need not be a member of the Company and the provision of Section 149(1)(b) of the Companies Act, 1965, shall not apply.
2. The instrument appointing a proxy must be in writing under the hands of the appointer or his attorney duly authorised in writing or, if such appointer is a
corporation, under its common seal or the hand of an officer or attorney duly authorised. If the Form of Proxy is signed under the hand of an officer duly
authorised, it should be accompanied by a statement reading “signed as authorised officer under Authorisation Document which is still in force, no notice of
revocation having been received”. If the Form of Proxy is signed under the attorney duly authorised, it should be accompanied by a statement reading “signed
under Power of Attorney which is still in force, no notice of revocation having been received”. A copy of the Authorisation Document or the Power of
Attorney, which should be valid in accordance with the laws of the jurisdiction in which it was created and is exercised, should be enclosed.
3. The maximum number of proxies that may be appointed is two. Where a member appoints more than one proxy, the appointment shall be invalid unless he
specifies the proportion of his shareholdings to be represented by each proxy.
4. Where a member of the Company is an authorised nominee as defined under the Securities Industry (Central Depositories) Act, 1991, it may appoint at least
one proxy in respect of each securities account it holds with ordinary shares of the Company standing to the credit of the said securities account.
Every appointment submitted by an authorised nominee as defined under the Securities Industry (Central Depositories) Act, 1991, must specify the CDS
Account Number.
5. The instrument appointing the proxy must be deposited at the office of the Registrar, Tenaga Koperat Sdn Bhd, Level 17, The Gardens North Tower, Mid Valley
City, Lingkaran Syed Putra, 59200 Kuala Lumpur not less than forty eight (48) hours before the time appointed for the meeting.
6. For the purpose of determining a member who shall be entitled to attend the Meeting, the Company shall be requesting Bursa Malaysia Depository Sdn Bhd,
in accordance with Article 67(b) of the Company’s Articles of Association and Section 34(1) of the Securities Industry (Central Depositories) Act, 1991, to issue
a General Meeting Record of Depositors as at 13 August 2009. Only a depositor whose name appears on the General Meeting Record of Depositors as at 13
August 2009 shall be entitled to attend the said meeting or appoint proxies to attend and/or vote in his stead.
Fold Here
STAMP
The Registrar
Tenaga Koperat Sdn Bhd
Level 17, The Gardens North Tower
Mid Valley City, Lingkaran Syed Putra
59200 Kuala Lumpur
Fold Here
✂

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Operations Review

PROTON’s MPV, the Exora, goes into production.

PROTON 2009 ANNUAL REPORT 81

An increasing number of model lines or equipment was established through ‘yokoten’,

In view of PROTON’s commitment to improvement, the Manufacturing Division has

State-of-the-art equipment at our manufacturing facilities in Shah Alam.

PROTON Shah Alam

PROTON 2009 ANNUAL REPORT 83

PROTON Tanjung Malim

PROTON 2009 ANNUAL REPORT 85

Production of the Exora is expected to

PROTON 2009 ANNUAL REPORT 87

Evora’s successful press launch is a clear reflection

It took a clean sheet of paper and a little over 27

PROTON 2009 ANNUAL REPORT 89

A Lotus showroom in Europe.

PROTON 2009 ANNUAL REPORT 91

Achieving quality excellence continued

Quality in Design & Development

At PROTON, we clearly understand the importance of building in the elements of quality

Quality inspection of the Exora in progress.

PROTON 2009 ANNUAL REPORT 95

Quality excellence touches all aspects of PROTON’s business, including customer

Quality in the Market

PROTON 2009 ANNUAL REPORT 97

Sales & Distribution

In 2008, primarily as a result of heightened sales activity by the

PROTON 2009 ANNUAL REPORT 101

Performance and Operations

Additionally, in terms of market expansion, we took steps to increase PROTON’s visibility

The Persona and Saga are set to make waves abroad.

5-Year Export Volume and 2009/10 Forecast

PROTON 2009 ANNUAL REPORT 103

Performance and Operations

Youngman plans to operate four plants in China,

PROTON’s operations begin in China.

Performance and Operations

PROTON 2009 ANNUAL REPORT 105

Performance and Operations

PROTON 2009 ANNUAL REPORT 107

Performance and Operations

The Saga landed in Singapore in mid 2008.

Performance and Operations

PROTON 2009 ANNUAL REPORT 109

Performance and Operations

The Persona is launched Down Under.

PROTON 2009 ANNUAL REPORT 111

Performance and Operations

The Gen.2 in the UK.

PROTON 2009 ANNUAL REPORT 113

PROTON 2009 ANNUAL REPORT 115

PCSB offers competitive hire purchase loan financing

Corporate Social Responsibility

PROTON 2009 ANNUAL REPORT 119

Maintaining customer satisfaction is one of the foremost pillars of PROTON’s business

If a product experiences a malfunction, the Company acts promptly to minimise adverse

PROTON 2009 ANNUAL REPORT 121

Maintaining open communications between employees and Management is also vital.

To further strengthen PROTON’s learning capability, we implemented the PROTON

PROTON conducts numerous training

PROTON 2009 ANNUAL REPORT 123

To facilitate the development of non-executive employees, PROTON is also in discussions

PROTON has also embarked on a major initiative of institutionalising Knowledge