Year 2000 Compliance

The Group has adopted the definition of Year 2000 compliance as promulgated by the British Standards Institute which, in simple terms, means neither performance nor functionality of computer and other systems and equipment that rely on embedded electronic chip technology is affected by dates prior to, during and after the year 2000.

In 1997, the Group began to conduct a detailed risk assessment of the Year 2000 issue. A comprehensive action plan and a timetable have been put in place. A special task force, led by an executive director of the Company and supported by in-house IT personnel, was set up to undertake the compliance work.

The Year 2000 compliance project of the Group includes the upgrade or replacement of all purchased computer hardware and system software products and the modification of all in-house developed computer application software, which are not Year 2000 compliant.

The required systems upgrade and modification have been completed. The relevant computer suppliers and service providers have also confirmed that their products and services are Year 2000 compliant. It is anticipated that the Year 2000 issue will not cause any significant operational problems to the Group. The Group has formulated contingency plans to deal with any unforeseen problems that may arise during the millennium crossover.

The total cost of the compliance project is approximately HK$3.8 million, mainly for replacement of computer hardware and system software with upgraded versions and most of which have been capitalised in the accounts. Any further cost to be incurred in relation to contingency planning is expected to be immaterial.