Page 375 - CRC_One Report 2021_EN

Business Overview and Performance Corporate Governance Financial Statements Enclosure

Persons or Companies Transaction value (Baht : Million) Audit
Necessity and rationale of
which may have Committee’s
conflict of interest Transaction 2019 2020 2021 transactions Opinion
3.1 Management fee expenses (Cont.)
HCDS Group: Management 90.59 80.99 80.87 The Company and its business Transactions are
− Harng Central fee expenses units received legal services from normal course of
Department Store HCDS. HCDS is responsible for both business transactions
Limited − Legal general legal tasks such as business which are favorable
− CGE Investment − Tax establishment and documentation to the Group. Service
Limited revision, and special projects such rate is calculated from
as merger and acquisition. However, cost plus margin and
managements considered that the can be comparable
Company would take advantages from to market rates.
services provided by HCDS because Therefore, transactions
of its expertise and specialization are reasonable and
of employees in legal. Service fees beneficial to the
are comparable to market rates and Group.
conditions are agreed to condition of
general trading.

Moreover, the Group received other
services which are tax consulting, tax
audit service, and tax refund service
from HCDS. Tax consulting service
would be charged monthly with rates
that can be compared to the market
and conditions agreed to general
trading conditions. For auditing and
tax refund service, rates would be
variable rates based on percentage of
tax refund and detected income which
is inconsistent with invoices. Service fees
are comparable to other service rates in
the market and conditions are agreed
to the condition of general trading.

Management 9.98 8.88 14.50 Business units receive other services Transactions are
fee expenses which mostly are hiring HCDS Group normal course of
to service retail management projects. business transactions
- Other The Group lease land for a long time which are favorable
services and hire HCDS to manage properties. to the Group. Service
In addition, properties management rate is calculated
business is not a core business of the from c ost plus
Group. Therefore, the Group decided margin and can
to hire other companies which have be comparable to
expertise to manage it. Then, the Group market rates. Therefore,
can only focus on core business of the transactions are
Group. Managements considered that reasonable and
business units would take advantages beneficial to the
from service provided by HCDS because Group.
of its expertise and specialization of
employees. The Group and HCDS
have entered into service agreements
and agreed services scopes, service
fee, and conditions annually. Service
fees are comparable to other service
rates in the market and the conditions
are agreed to the condition of general
trading.

Annual Report 2021 (Form 56-1 One-Report) 375