STATEMENT OF FINANCIAL POSITION ( as at 30th June, 2015) Note Assets Non-current assets Property, plant and equipment 2(b), 7 12,099,269 12,369,499 De

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1 STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME ( for the year ended 30th June, 2015) Note Income Levy income 4(a) 23,980,738 22,873,299 Training course income 4(b) 3,522,830 4,101,525 Membership fee income 4(c) 2,463,400 2,553,000 Inbound tour registration fee income 4(d) 4,019,150 2,891,480 Tour Escort Pass and Tourist Guide Pass income 1,849,846 1,877,556 Shop registration income 359, ,000 Airport service counter income 227, ,200 Bank interest income 2(c), , ,400 Cruise Holiday Expo income - 3,099,385 Other operating income 1,145, ,858 37,878,597 38,877,703 Expenditure Staff costs 21,875,762 19,789,839 Public and member relations 3,689,559 3,398,718 Training course expenses 1,785,246 2,127,657 Refund of membership subscription fee 4(c) 2,020,000 1,977,600 Legal and professional fees 944, ,317 General and administration 1,009, ,962 Rental, building management fee and related expenses 2,483,912 2,367,372 Repair and maintenance of franking machines 1,316,030 1,096,056 Tour Escort Pass and Tourist Guide Pass expenses 60, ,426 Airport service counter operating expenses 225, ,663 Investigation expenses 402, ,386 Planning, research and development expenses 10, Director's fees, emoluments and travelling allowances 14, 15 96,000 96,000 Auditor's remuneration 47,700 45,000 Depreciation 2(b), 7 362, ,651 Interest expenses 75,023 59,163 Cruise Holiday Expo expenses - 3,410,152 36,403,847 37,024,412 Surplus before taxation 5 1,474,750 1,853,291 Income tax 6(b) (204,224) (287,921) Surplus for the year 1,270,526 1,565,370 Other comprehensive income for the year, net of tax - - Total comprehensive income for the year 1,270,526 1,565,370 The notes on pages 54 to 64 form an integral part of these financial statements. 50 / TIC Annual Report

2 STATEMENT OF FINANCIAL POSITION ( as at 30th June, 2015) Note Assets Non-current assets Property, plant and equipment 2(b), 7 12,099,269 12,369,499 Deferred taxation 6(d) 299, ,134 12,398,385 12,707,633 Current assets Accounts receivable 415, ,241 Sundry deposits, prepayments and temporary payments 1,594,654 1,586,322 Cash and bank balances 13 29,625,276 29,164,476 Security deposits from affiliate members 10 4,500,000 4,650,000 Deposits with bank for IATA 9 11,552,021 11,408,948 47,687,352 47,174,987 Current liabilities Accounts payable and accruals 5,467,020 6,239,149 Provision for severance and long service payment 514, ,000 Membership fees received in advance 2,002,600 1,994,200 Course fees received in advance 382, ,600 Pass fees received in advance 2,532,482 2,670,577 Provision for taxation 6(a) 165, ,355 Security deposits from affiliate members 10 4,500,000 4,650,000 Other payable to IATA 9 11,552,021 11,408,948 27,115,420 28,182,829 Net current assets 20,571,932 18,992,158 Total net assets 32,970,317 31,699,791 Accumulated fund Accumulated surplus carried forward 8 32,970,317 31,699,791 MH, JP The financial statements on pages 50 to 64 were approved and authorised for issue by the Board of Directors on 13th October, 2015 and signed on its behalf by: Mr. WU Siu Ieng, Michael MH, JP Chairman Mr. Martin MA Hon. Treasurer The notes on pages 54 to 64 form an integral part of these financial statements. 51

3 STATEMENT OF CHANGES IN ACCUMULATED FUND ( for the year ended 30th June, 2015) Accumulated surplus at the beginning of the year 31,699,791 30,134,421 Total comprehensive income for the year 1,270,526 1,565,370 Accumulated surplus at the end of the year 32,970,317 31,699, / TIC Annual Report

4 STATEMENT OF CASH FLOWS ( for the year ended 30th June, 2015) Note Cash flows from operating activities Surplus before taxation 1,474,750 1,853,291 Adjustments for: Depreciation 362, ,651 Bank interest income (235,341) (167,237) - Bank interest income deposits with bank for IATA (75,023) (59,163) Interest expenses payable to IATA 75,023 59,163 Operating surplus before working capital changes 1,601,804 2,046,705 ( ) / (Increase)/Decrease in accounts receivable (50,160) 384,100 ( ) (Increase) in prepayments and deposits (8,332) (100,707) ( ) / (Decrease)/Increase in accounts payable and accruals (772,129) 1,981,142 ( ) / (Decrease)/Increase in provision for severance and long service payment 239,000 - Increase in membership fees received in advance 8,400 74,000 / ( ) Increase/(Decrease) in course fees received in advance 62,490 (173,480) ( ) / (Decrease)/Increase in pass fees received in advance (138,095) 35,294 Cash inflow from operating activities 942,978 4,247,054 Income tax paid (625,353) (775,798) Overprovision of tax 2014/2015 (1) - Net cash inflow from operating activities 317,624 3,471,256 Cash flows from investing activities Purchase of property, plant and equipment (92,165) (148,669) Bank interest income 235, ,237 - Bank interest income deposits with bank for IATA 75,023 59,163 Net cash inflow from investing activities 218,199 77,731 Net cash inflow before financing activities 535,824 3,548,987 Financing activities Interest expenses payable to IATA (75,023) (59,163) Net cash outflow from financing activities (75,023) (59,163) Net increase in cash and cash equivalents 460,801 3,489,824 Cash and cash equivalents at the beginning of the year 29,164,476 25,674,652 Cash and cash equivalents at the end of the year 13 29,625,276 29,164,476 The notes on pages 54 to 64 form an integral part of these financial statements. 53

5 NOTES TO THE FINANCIAL STATEMENTS ( for the year ended 30th June, 2015) ( ) Corporate information The Council was incorporated in Hong Kong with liability limited by guarantee under the Hong Kong Companies Ordinance. The address of its registered office and principal place of business is Rooms , Fortress Tower, 250 King's Road, North Point, Hong Kong. The principal activities of the Council are to serve as a regulatory body of travel agents, which are registered members of the Council, as well as tour escorts and tourist guides in Hong Kong. The Council also conducts activities relating to maintaining a high professional standard within the travel industry and protecting the interests of travellers and the service providers in the travel industry. The financial statements are presented in the Hong Kong dollar, which is also the functional currency of the Council. 54 a. ( ) b. ( ) 20% % 20% / TIC Annual Report Significant accounting policies The significant accounting policies applied in the preparation of these financial statements are set out below. These policies have been consistently applied to all the years presented, unless otherwise stated. a. Basis of preparation of the financial statements These financial statements have been prepared in accordance with all applicable Hong Kong Financial Reporting Standards ("HKFRSs") (which also include Hong Kong Accounting Standards ("HKASs") and Interpretations) issued by the Hong Kong Institute of Certified Public Accountants, accounting principles generally accepted in Hong Kong and the disclosure requirements of the Hong Kong Companies Ordinance. The financial statements have been prepared under the historical cost convention. The preparation of financial statements in conformity with HKFRSs requires the use of accounting estimates. It also requires the Council to exercise its judgement in the process of applying the accounting policies. The Hong Kong Institute of Certified Public Accountants has issued a number of new and revised HKFRSs. The adoption of these HKFRSs which are effective for the Council's accounting periods beginning on 1st July, 2015 has no material impact on the Council's results and financial position. b. Property, plant and equipment Property, plant and equipment are stated at historical cost less accumulated depreciation and accumulated impairment losses. Historical cost includes expense that is directly attributable to the acquisition of the items. 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 Council and the cost of the item can be measured reliably. All other repairs and maintenance are expensed in the statement of profit or loss and other comprehensive income during the financial year in which they are incurred. Depreciation of plant and equipment is calculated using the straight line method to allocate cost to their residual values over their estimated useful lives, as follows: Office equipment and computer 20% % Furniture and fixtures 20% Buildings Depreciated over 41 years Leasehold land Over the unexpired term of the lease The assets' residual values and useful lives are reviewed, and adjusted if appropriate, at the end of the reporting period. An asset's carrying amount is written down immediately to its recoverable amount if the asset's carrying amount is greater than its estimated recoverable amount. Buildings held for use in the production or supply of goods and services, or for administrative purposes, are stated in the statement of financial position at cost less accumulated depreciation and accumulated impairment losses.

6 ( ) c. d. e. (a) (i) (ii) (iii) (b) (i) ( ) (ii) ( ) (iii) (iv) (v) Depreciation on buildings is provided to write off the cost over their estimated economic lives using the straight line method. An item of property, plant and equipment is derecognised upon disposal or when no future economic benefits are expected to arise from the continued use of the asset. Any gain or loss arising on derecognition of the asset (calculated as the difference between the net disposal proceeds and the carrying amount of the item) is included in the statement of profit or loss and other comprehensive income in the year in which the item is derecognised. c. Income recognition Income is recognised when it is probable that the economic benefits will flow to the Council and when the income can be measured reliably. Membership subscriptions are payable by reference to the year commencing 1st July and shall be due and payable in one sum on 1st June each year. Levy income is recognised when the levy stamp has been franked on the tour receipt. Inbound tour registration fee income is recognised when the Council receives payment. Income from seminars and courses is recognised in the period when the services are rendered. Bank interest income is accrued on a time proportion basis on the principal outstanding and at the interest rate applicable. Airport service counter income is recognised when the relevant services are rendered. Other operating income is recognised when received. d. Income tax Income tax represents the sum of the tax currently payable and deferred tax. The tax currently payable is based on taxable surplus for the year. Taxable surplus differs from surplus reported in the statement of profit or loss and other comprehensive income because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The Council's liability for current tax is calculated using tax rates that have been enacted or substantively enacted at the end of the reporting period. Deferred tax is provided in full, using the liability method, on temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the financial statements. However, if the deferred tax arises from initial recognition of an asset or liability in a transaction other than a business combination that at the time of the transaction affects neither accounting nor taxable surplus or loss, it is not accounted for. Deferred income tax is determined using tax rates that have been enacted or substantively enacted at the end of the reporting period and are expected to apply when the related deferred income tax asset is realised or the deferred income tax liability is settled. Deferred tax assets are recognised to the extent that it is probable that future taxable surplus will be available against which the temporary differences can be utilised. e. Related parties A party is considered to be related to the Council if: (a) A person or a close member of that person's family is related to the Council if that person: (i) has control or joint control over the Council; (ii) has significant influence over the Council; or (iii) is a member of the key management personnel of the Council or of a parent of the Council; (b) An entity is related to the Council if any of the following conditions applies: (i) The entity and the Council are members of the same group (which means that each parent, subsidiary and fellow subsidiary is related to the others). (ii) One entity is an associate or joint venture of the other entity (or of a member of a council of which the other entity is a member). (iii) Both entities are joint ventures of a third entity. 55

7 f. (vi) (a) (vii) (a)(i) ( ) g. h. i. j. k. ( ) (iv) One entity is a joint venture of a third entity and the other entity is an associate of the third entity. (v) The entity is a post-employment benefit plan for the benefit of employees of either the Council or an entity related to the Council. If the Council is itself such a plan, the sponsoring employers are also related to the plan. (vi) The entity is controlled or jointly controlled by a person identified in (a). (vii) A person identified in (a)(i) has significant influence over the entity or is a member of the key management personnel of the entity (or of a parent of the entity). f. Provisions Provisions are recognised when the Council has a present legal or constructive obligation as a result of past events; it is more likely than not that an outflow of resources will be required to settle the obligation; and the amount has been reliably estimated. Where there are a number of similar obligations, the likelihood that an outflow will be required in settlement is determined by considering the class of obligations as a whole. A provision is recognised even if the likelihood of an outflow with respect to any one item included in the same class of obligations may be small. g. Contingent liabilities and contingent assets A contingent liability is a possible obligation that arises from past events and whose existence will only be confirmed by the occurrence or non-occurrence of one or more uncertain future events not wholly within the control of the Council. It can also be a present obligation arising from past events that is not recognised because it is not probable that outflow of economic resources will be required or the amount of obligation cannot be measured reliably. A contingent liability is not recognised but is disclosed in the notes to the financial statements. When a change in the probability of an outflow occurs so that outflow is probable, it will then be recognised as a provision. A contingent asset is a possible asset that arises from past events and whose existence will only be confirmed by the occurrence or non-occurrence of one or more uncertain events not wholly within the control of the Council. A contingent asset is not recognised but is disclosed in the notes to the financial statements when an inflow of economic benefits is probable. When inflow is virtually certain, an asset is recognised. h. Current assets and liabilities Current assets are expected to be realised within 12 months of the end of the reporting period or in the normal course of the Council's operating cycle. Current liabilities are expected to be settled within 12 months of the end of the reporting period or in the normal course of the Council's operating cycle. i. Pension costs The Council operates two defined contribution retirement benefits schemes under the Mandatory Provident Fund Schemes Ordinance for certain employees. Contributions are made based on a percentage of the eligible employees' salaries and are charged to the statement of profit or loss and other comprehensive income as they become payable in accordance with the rules of the schemes. The assets of the schemes are held separately from those of the Council in independently administered funds. With respect to the Mandatory Provident Fund retirement benefits scheme, the Council's employer contributions vest fully with the employees when contributed into the scheme. j. Operating leases Leases where substantially all the risks and rewards of ownership of assets remain with the lessor are accounted for as operating leases. Rentals payable under the operating leases are recognised as an expense in the statement of profit or loss and other comprehensive income on the straight-line basis over the lease terms. k. Financial instruments Financial assets The Council's financial assets are classified into loans and receivables. Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market. At the end of the reporting 56 / TIC Annual Report

8 ( ) l. m. 3. a. b. c. period subsequent to initial recognition, loans and receivables (including accounts receivables) are carried at amortised cost using the effective interest rate method, less any identified impairment losses. An impairment loss is recognised in the statement of profit or loss and other comprehensive income when there is objective evidence that the asset is impaired, and is measured as the difference between the asset's carrying amount and the present value of the estimated future cash flows discounted at the original effective interest rate. Impairment losses are reversed in subsequent periods when an increase in the asset's recoverable amount can be related objectively to an event occurring after the impairment was recognised, subject to a restriction that the carrying amount of the asset at the date the impairment is reversed does not exceed what the amortised cost would have been had the impairment not been recognised. Financial liabilities and equity Financial liabilities and equity instruments issued by an entity are classified according to the substance of the contractual arrangement entered into and the definitions of a financial liability and an equity instrument. An equity instrument is any contract that evidences a residual interest in the assets of the Council after deducting all of its liabilities. The Council's financial liabilities (including amount due to the Travel Industry Compensation Fund and accounts payable) are subsequently measured at amortised cost, using the effective interest rate method. l. Derecognition of financial assets and financial liabilities Financial assets are derecognised when the rights to receive cash flows from the assets have expired; or when the Council has transferred its contractual rights to receive the cash flows of the financial assets and has transferred substantially all the risks and rewards of ownership; or where control is not retained. Financial liabilities are derecognised when they are extinguished, i.e., when the obligation is discharged, cancelled or expires. m. Cash and cash equivalents Cash and cash equivalents include cash at bank and in hand, time deposits with banks and other short-term highly liquid investments with original maturities of three months or less and bank overdrafts. 3. Financial risk management Financial instruments The principal financial assets of the Council are annual fee receivable from members, sundry deposits, prepayments, temporary payments, bank balances, deposits and cash. The principal financial liabilities of the Council include membership fees received in advance, other payables, course fees received in advance, pass fees received in advance, levy received in advance, security deposits received from affiliate members, accounts payable and accruals. The Council did not hold or issue any financial instruments for trading purposes or any positions in derivative contracts during the year ended 30th June, a. Foreign currency risk Substantially all the revenue-generating operations of the Council were transacted in the Hong Kong dollar during the year ended 30th June, 2015, which is the functional and presentation currency of the Council. The Council therefore does not have significant foreign exchange risk. b. Credit risk Credit risk is the risk that a counterparty will be unable to pay amounts in full when due. The Council's "receivables" are very short-term in nature and the associated risk is minimal. Subscriptions, fees, income from courses, rental income and other activities are collected in advance. As at 30th June, 2015, the Council has no significant concentration of credit risk. c. Interest rate risk Interest rate risk is the risk that the value of a financial instrument will fluctuate due to changes in market interest rates. The Council is subject to the risk due to fluctuation in the prevailing levels of market interest rates on its cash and bank balances. 57

9 The interest rate risk exposure of the Council is set out below: Time deposits 28,396,015 26,009,143 Savings accounts 1,005,212 2,608,139 Current accounts and cash in hand 224, ,194 29,625,276 29,164,476 Percentage per annum Percentage per annum Effective interest rate of time deposits 0.67%-1.30% 0.52%-1.28% Effective interest rate of savings accounts 0.01% 0.01% d. d. Liquidity risk The Council is exposed to minimal liquidity risk as the Council closely monitors its cash flow position. The maturity profile of the Council's financial liabilities at the reporting date, based on the contractual undiscounted payments, is as follows: 2015 On demand Less than 3 months 3 to less than 12 months 1 to 5 years Total Accounts payable and accruals - 5,467, ,467,020 Provision for severance and long service payment , ,000 Security deposits from affiliate members 4,500, ,500,000 Other payable to IATA 11,552, ,552,021 16,052,021 5,467, ,000 22,033, On demand Less than 3 months 3 to less than 12 months 1 to 5 years Total Accounts payable and accruals - 6,239, ,239,149 Provision for severance and long service payment , ,000 Security deposits from affiliate members 4,650, ,650,000 Other payable to IATA 11,408, ,408,948 16,058,948 6,239, ,000 22,573, / TIC Annual Report

10 4. a ( ) 32(I) 4. Income a. Levy income Levy income represents the Council levy stipulated under Section 32(I) of the Travel Agents (Amendment) Ordinance b. c. b. Training course income Training course income includes the course fees charged for the tour escort certificate course, the tourist guide training course and other training courses. c. Membership fee income Membership subscriptions 2,148,100 2,106,800 Entrance fee 248, ,800 Charges for changes of members' particulars 66,900 69,400 2,463,400 2,553,000 6(2) d. 5. During the year, refund of membership subscription fees was made in accordance with Article 6(2) of the Council's Articles of Association. d. Inbound tour registration fee income Inbound tour registration fee income is registration charges for mainland China's inbound tours received from inbound travel agents. 5. Surplus before taxation Surplus before taxation is arrived at after charging: Auditor's remuneration 47,700 45,000 Depreciation 362, ,651 Director's fees, emoluments and travelling allowances 96,000 96,000 Defined contribution retirement benefits schemes - - Mandatory provident fund and provident fund contributions 1,353,790 1,221,518 Interest expenses - - payable to IATA 75,023 59, a. 6. Taxation a. Provision for taxation in the statement of financial position represents: At the beginning of the year 625,355 1,161,689 Overprovision of tax 2014/2015 (1) - Charged for the year 185, ,464 Income tax paid (625,353) (775,798) Profit tax rebate (20,000) (10,000) At the end of the year 165, ,355 59

11 b. b. Income tax in the statement of profit or loss and other comprehensive income represents: Current tax 185, ,464 Profit tax rebate (20,000) (10,000) Deferred tax 39,018 48, , ,921 c. 16.5% ( 16.5%) c. The following is a reconciliation of income tax calculated at the applicable tax rate of 16.5% (2014: 16.5%) with income tax expense: Surplus from ordinary activities before taxation 1,474,751 1,853,291 Expected Hong Kong profits tax at applicable tax rate 243, ,793 Profit tax rebate (20,000) (10,000) Tax effects of: - - Non-taxable income (38,831) (27,594) - - Portion of current year depreciation of leasehold land that is not deductible in determining taxable surplus 19,722 19,722 Income tax expense for the year 204, ,921 d. d. Analysis of deferred tax assets Accelerated tax Depreciation Total At 30th June, , ,591 Charged to income for the year (48,457) (48,457) At 30th June, , ,134 Charged to income for the year (39,018) (39,018) At 30th June, , , For the purposes of statement of financial position presentation, certain deferred tax assets and liabilities have been offset in accordance with the conditions set out in HKAS 12. The following is the analysis of the deferred tax balances for financial reporting purposes: Deferred tax assets arising from: - - Leasehold land and building 320, , other fixed assets (21,671) (31,314) 299, , % Provision for taxation in the statement of financial position represents Hong Kong profits tax provided at the rate of 16.5% on the estimated assessable surplus for the year less the amount of provisional Hong Kong profits tax paid. 60 / TIC Annual Report

12 7. 7. Property, plant and equipment Furniture and Office equipment and Buildings Leasehold land fixtures computers Total Cost At ,182,783 13,182,783 3,019,018 1,713,401 31,097,985 Additions - - 8, , ,669 Disposals (56,500) (56,500) At and ,182,783 13,182,783 3,027,625 1,796,963 31,190,154 Additions ,165 92,165 Disposals (240,886) (240,886) At ,182,783 13,182,783 3,027,625 1,648,242 31,041,433 Accumulated depreciation At ,175,826 2,081,487 2,825,308 1,433,883 18,516,504 Charge for the year 47,951 99,118 54, , ,651 Eliminated on disposals (56,500) (56,500) At and ,223,777 2,180,605 2,880,213 1,536,060 18,820,655 Charge for the year 47,951 99,118 55, , ,395 Eliminated on disposals (240,886) (240,886) At ,271,728 2,279,723 2,935,697 1,455,016 18,942,164 Net book value At ,055 10,903,060 91, ,226 12,099,269 At ,006 11,002, , ,903 12,369,499 The Council's interest in leasehold land is analysed as follows In Hong Kong, held on: - - Long-term leases 5,947,160 6,046, Medium-term leases 4,955,900 4,955,900 10,903,060 11,002, Accumulated fund The Council is limited by guarantee and does not have a share capital. Every member of the Council undertakes to contribute to the assets of the Council in the event of its being wound up while he is a member or within one year after he ceases to be a member, for payment of the debts and liabilities of the Council contracted before he ceases to be a member, and of the costs, charges and expenses of winding up, and for the adjustment of the rights of the contributories among themselves, such amount as may be required not exceeding HK$100 in aggregate. 61

13 Deposits with bank for IATA The Council holds bank deposits in trust for the International Air Transport Association (IATA) in accordance with the mutual understanding between the two parties. The amounts were shown respectively under current assets and current liabilities in accordance with HKAS 1. Interest income therefrom is accrued to the balances with IATA Security deposits from affiliate members The Council holds bank deposits as security deposits from affiliate members in accordance with the agreement between the Council and affiliate members. The amounts were shown respectively under current assets and current liabilities in accordance with HKAS Operating leases The Council as lessee: Minimum lease payments paid under operating leases for premises: 2,439,491 1,594,720 The Council had commitments for future minimum lease payments under noncancellable operating leases which fall due as follows: Within one year 1,407,462 1,504,746 ( ) In the second to fifth years inclusive 1,032, ,754 2,439,491 1,693,500 The Council as lessor: The total amount of rental income from sub-leasing of the airport service counter and other rental income earned: Sub-leasing of the airport service counter 227, ,200 Other rental income 3,500 1, , ,600 The total amount of rent receivable from sub-leasing of the airport service counter and other rental income under non-cancellable operating leases are as follows: Within one year - 229,200 ( ) In the second to fifth years inclusive , / TIC Annual Report

14 Bank interest income Bank interest income in the statement of profit or loss and other comprehensive income represents: Bank interest income - deposits 235, ,237 Bank interest income - deposits with bank for IATA 75,023 59, , , Cash and cash equivalents Cash and cash equivalents consist of cash in hand and balance with banks. Cash and cash equivalents at the end of the reporting period as shown in the statement of cash flows can be reconciled to the amounts in the statement of financial position as follows: Cash at bank and in hand 29,625,276 29,164, (1) ( ) 2 a. 4 55(4) 14. Directors' benefit and interest Remuneration of the directors of the Council disclosed pursuant to section 383(1) of the Hong Kong Companies Ordinance and Part 2 of the Companies (Disclosure of Information about Benefits of Directors) Regulation is as follows: a. Directors' emoluments The directors of the Council are not permitted to receive any remuneration or other benefit in money or money's worth pursuant to Clause 4 of the Council's Memorandum of Association. Travelling allowances paid or receivable in respect of a person's services as a director of the Council pursuant to Article 55(4) of the Council's Articles of Association: ( ) Mr. Wu Siu Ieng, Michael (Chairman) 96,000 96,000 b. 4 ( ) c. ( ) b. The directors of the Council are not permitted to receive any retirement and termination benefits paid pursuant to Clause 4 of the Memorandum of Association of the Council during the year (2014: Nil). c. There were no loans, quasi-loans and other dealings in favour of directors, their controlled bodies corporate and their connected entities made during the year (2014: Nil) ,105,558 ( 2,029,877 ) 1,928,079 ( 1,858,115 ) 177,479 ( 171,762 ) 15. Key management personnel's remuneration The Executive Director received HK$2,105,558 (2014: HK$2,029,877) in employee benefits, being HK$1,928,079 (2014: HK$1,858,115) in salaries and HK$177,479 (2014: HK$171,762) in retirement benefit. 63

15 Related party transactions During the year, the Council has no transactions with its related parties. 17. ( ) Capital management The Council's primary objectives when managing accumulated surplus are to safeguard the Council's ability to continue as a going concern, so that it can continue to serve as a regulatory body of travel agents, which are registered members of the Council, as well as tour escorts and tourist guides in Hong Kong. The Council also conducts activities relating to maintaining a high professional standard within the travel industry and protecting the interests of travellers and the service providers in the travel industry. The Council actively and regularly reviews and manages its accumulated surplus to ensure adequacy for operational needs. 18. Critical accounting estimates and judgements The preparation of financial statements in conformity with HKFRSs requires the management to make judgements, estimates and assumptions that affect the application of policies and reported amounts of assets, liabilities, income and expenses. The estimates and associated assumptions are based on historical experience and various other factors that are believed to be reasonable under the circumstances, the results of which form the basis of making the judgements about carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates. The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised if the revision affects only that period, or in the period of the revision and future periods if the revision affects both current and future periods. 64 / TIC Annual Report