26 August 1998

REPORT ON THE PREPARATIONS FOR THE YEAR 2000

TRANSLATION REPORT ON THE PREPARATIONS FOR THE YEAR 2000. Reported by : BEC World Public Company Limited Line of Business : Broadcasting and Entertainment Address of the Head Office : 1126/2 New Petchburi Road, Makkasan, Rajtevi, Bangkok 10400 Telephone : 2679252-6 Fax : 253-9978 Report on the preparations for the year 2000 for the first (1st)time. Report up-dated to: June 30, 1998 PREPARATIONS FOR THE YEAR 2000: 1. ANALYSIS AND EVALUATION OF THE IMPACT OF THE YEAR 2000: The Company has sometime ago initiated an analysis and evaluation of the impact of the year 2000 on the operations of the group, comprising both the operations of the Company and all of its subsidiaries, including broadcasting operations, business operations and back-office operations which includes management information systems. The Company has done so by hiring outside expert organization to survey and creating a complete list of computer equipment including all peripherals and network system, being used within the organization then test and evaluate all those equipment, together with suppliers of those main equipment, to see whether there is any problem on the year 2000 issues, within both hardware and software side of those equipment. The operations are supervised by one (1) OF THE Companys Executive Director. These operations are finished. As a result of the above-mentioned analysis and evaluation processes, the Company found that the operating system (O.S.) of the Companys main processing equipment cannot cope with the year 2000, the data-base for the Company management information system is using six-digit date format i.e. YYMMDD which needs to be modified and certain portion of the personal computers (P.C.) which were acquired prior to 1996 need to be replaced. 2. THE IMPACT OF YEAR 2000 PROBLEMS ON THE GROUPS OPERATIONS: The problems identified from the above-mentioned studies have the following impact on the groups operations: a) Impact on the computer system and internal management system: (1) Problems on main processing equipment: The main processing equipment of the group is IBM AS/400. This machine, even can accommodate a newer version of operating system that can cope with the year 2000 but, will be slower and less efficient. (2) Problems on main operating system: The existing operating system(OS400), installed on our IBM AS/400, cannot cope with the year 2000 thus has to be replaced. (3) Problems on data-base and application programs for management information systems: The data-base for the Company management information system is using six-digit date format i.e. YYMMDD which is a problem on year 2000 thus has to be modified together with all the application programs. (4) Problems on old personal computers(P.C.): Most of the personal computers (P.C.) within the group are used as terminals or productivity tools. There are certain units which are old and cannot cope with the year 2000 thus have to be replaced. Therefore, the Company has already orders a new IBM AS/400 together with new version of operating system (OS400) to replace the existing machine. The Company has also hired an outside-expert to modified our data-base as well as all the relevant application programs for our management information system. b) Impact on the general business operations: As most of the internal business (back office) operations and our management information system are based on the capabilities of our existing IBM AS/400 which cannot cope with the year 2000 thus if this machine, its O.S. and all relevant application programs are not replaced or modified the group will have difficulties in order processing, invoice issuing and some of our business processes, such as aging analysis for debts collection, which are performed by the machine. However most of those tasks can be handled by P.C. thus the real impact will be the efficiency of the group rather than the ability of the group to perform its services. c) Impact on the operations with outsiders as well as external factors: The uses of our group computer are mainly connected within the group. There is no direct external connection. Therefore there is not any impact on the operations with outsiders. Regarding the external factors, as most of our trade partners or counterparts are using computers as productivity tools and are not highly automated their operations, thus it is understood that the impact of year 2000 problems within our counterparts operations is very minimal and should have cause any problem to us. 3. PLAN TO SOLVE OUR YEAR 2000 PROBLEMS: a) Ways and means to solve the problems: + To purchase a new IBM AS/400 and new version of its operating system (OS/400) which can cope with the year 2000. + To hire outside experts to modify our data-base as well as all the application programs for our back-office operations. b) Steps in solving the problems including controls and time-table: Action Plan Time-Table (1) Appointing expert to survey and study all equipment and systems. Jan - Mar 98 (2) Ordering the replacement for IBM AS/400 with new OS. Apr-Jun 98 (3) Installing the new IBM AS/400 with new OS. Aug 98 (4) Outside expert modifies data-base and application programs. Jul 98 - Mar 99 (5) Testing all new applications: + test by user units Oct 98 - Apr 99 + check and attest by users supervisor Nov 98 - May 99 + endorse by the Project Leader Dec 98 - Jun 99 (6) Parallel Run Apr - Sep 99 c) Responsible units: + Outsider unit is an expert who was hired to modify our data-base and all application programs. The modification works include all necessary testing as well. + Units within the group are those users of the application programs (such as Sales, Accounts and Finance Division.) comprising of:- * first level users who are responsible to test the applications and evaluate test results. * unit supervisor will compile test reports from users then check and summarize them. * the project leader will perform the final checks, compares results with agreed objectives before summarizing and reports results to an Executive Director who is in-charge of the project. d) Expenditure involved: + Cost of acquiring new machine and its new operating system Baht 3 million. + Cost of hiring outside expert to modify data-base and application programs Baht 5 million. + Cost of replacing, up-grading P.C., equipment and net-work peripherals Baht 2 million. Total costs and expenditures Baht 10 million. 4. PROGRESS REPORT ON THE GROUPS YEAR 2000 PROBLEMS SOLVING PLAN: The year 2000 problems solving plan is progressing according to the above- mentioned plan. Problems have been identified. New IBM AS/400 is ordered. We expect that the delivery and installation of the new machine will be done in August 1998 as planed. An outside expert has already been appointed to modified our data-base and all of our back-office application programs. The expert has already started his duties. We believe that the problem solving plan will be progressing according to the plan both in term of time-table and expenditure budget. 5. MANAGEMENT DISCUSSION AND ANALYSIS: As recommended by SEC. and SET., we have presented SECs and SETs letters on this subject to the Board of Directors together with draft of this report. This is to ensure that the Board is aware of the concerns on this year 2000 issue and to give opportunity for Management to listen to opinions and advice from the Board in solving this year 2000 problem. The Management believes that our problem solving programs will be proceeding according to the plan as reported above, in term of time-table and expenditure budget. The Management also believes that if there is any problem prohibits us to solve this problems in time, the (year 2000) problems will not seriously effect the operations of the Company and all its subsidiaries apart from causing minor inconveniences and minor reduction in operations efficiency from lacking of productivity tools as above discussed. Anyhow, there is not any sign up-to this very moment that hints to us that these problem solving programs will not performing according to the plan or anything that can prohibit us from achieving the objectives of the plan. CERTIFICATION OF THE CORRECTNESS AND COMPLETENESS OF THE REPORT: We have examined the wording and data within this report and certify that the aforementioned wording and data within this report are complete and correct without any intended faults and that they will not mislead any other parties or that they lack of any substantial issues which should have been informed, so that the holders or the intended buyer of our share-capital may be damaged. In this regard, to evidence that all relevant documents are documents which we certify the correctness we have appointed Mr.Chatchai Thiamtong to sign on every pages of the documents. Any documents without the signature of Mr. Chatchai Thiamtong will not be deemed as the wording and data which we have certified. Name Position Signature Mr.Vichai Maleenont Chairman Mr.Prasan Maleenont Vice Chairman Mr.Pravit Maleenont Director Mr.Pracha Maleenont Director Mr.Prachum Maleenont Director Ms.Ratana Maleenont Director Ms.Nipa Maleenont Director Ms.Amporn Maleenont Director Mrs.Ratchanee Nipatakusol Director