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Notes to Accounts of Centrum Capital Ltd.

Jun 30, 2015

1. Nature of Operations

Centrum Capital Limited (the 'Company') is an Investment Banking Company and a SEBI Registered Category-I Merchant Banker. The Company offers a complete gamut of financial services in the areas of equity capital market, private equity, corporate finance, project finance, stressed asset resolution. The Company is also engaged in trading of bonds.

2. Operating lease

i) The Company has entered into cancellable leasing arrangements for corporate and branch Offices and residential premises. The lease rentals of Rs. 54,216,391/-* (previous year Rs. 46,913,171/-) have been included under the head Rent under Note 23 of Statement of Profit and Loss.

*Includes Net of Rent amounting to Rs. 60,562,090/- (P.Y Rs. 50,457,013/-) which company has in turn recovered from its group companies.

3. Interest in joint venture

The Company has 50% interest in Commonwealth Centrum Advisors Limited Accordingly, the following disclosures include Balance Sheet as well as Statement of Profit and Loss numbers of Commonwealth Centrum Advisors Limited.

4. Gratuity and Post employment benefit plans

Short Term Employee Benefits

Liability in respect of short term compensated absences is accounted for at undiscounted amount likely to be paid as per entitlement.

Defend Contribution Plan 7 Retirement benefits in the nature of Provident Fund, Superannuation Scheme and others which are defined contribution schemes, are charged to the Statement of Profit and Loss of the year when contributions accrue.

Defined Benefit Plan

The liability for Gratuity, a defined benefit obligation, is accrued and provided for on the basis of actuarial valuation using the Projected Unit Credit method as at the Balance Sheet date

Other Long Term Benefits

Long term compensated absences are provided on the basis of an actuarial valuation using the Projected Unit Credit method as at the Balance Sheet date. Actuarial gains and losses comprising of experience adjustments and the effects of changes in actuarial assumptions are recognised in the Statement of Profit and Loss for the year as income or expense.

Disclosure Under AS – 15 (Revised 2005)

Company has adopted the Accounting Standard (AS – 15) (Revised 2005) "Employee Benefits" effective April 01, 2007.

I. Defined Contribution Plans: The Company has classified the various benefits provided to employees as under:

a. Provident Fund

b. Employers' Contribution to Employees' State Insurance

The provident fund and the state defined contribution plan are operated by the Regional Provident Fund Commissioner and the Superannuation Fund is administered by the Trustee of the Life Insurance Corporation. Under the schemes, the Company is required to contribute a specified percentage of payroll cost to the retirement benefit schemes to fund the benefits. These funds are recognized by the Income Tax authorities.

5. Derivative Instruments and Un-hedged Foreign Currency Exposure

i. There were no contracts outstanding as at balance sheet date.

ii. Particulars of Unhedged Foreign Currency Exposure are detailed below at the exchange rate prevailing as at balance sheet date

6. Deferred Tax Asset / Liability

In accordance with the Accounting Standard 22 on Accounting for Taxes on Income, the Company has made adjustments in its accounts for deferred tax liabilities / assets.

The tax effects of significant temporary differences that resulted in deferred tax assets and liabilities are:

7. The Company has a process of identification of 'suppliers' registered under the Micro, Small and Medium Enterprises Development ('MSMED') Act, 2006, by obtaining confirmations from all suppliers. The Company has not received intimation from all the 'suppliers' regarding their status under MSMED Act, 2006 and hence disclosures if any, relating to amounts unpaid as at the year end together with interest paid/payable as required have not been furnished.

8. Trade Receivables are subject to confirmations, reconciliations and adjustments, if any, arising there from.

9. The Company has long outstanding trade receivable amounting to Rs. 45,832,632/-(P.Y. Rs. 45,832,632/-).Based on recent trends in collection and status of ongoing lawsuit; the above amount, in view of the management, is fully recoverable and accordingly the same need not be subject to any provisioning.

10. Pursuant to enactment of Companies Act,2013 ( the Act), the Company has, effective July 1, 2014, charged depreciation as per useful lives of its tangible assets as specified in Schedule II of the Act. In view of the notification no. G.S.R.627 (E) dated August 29, 2014, issued by the ministry of corporate Affairs (MCA), the Company till period ended March 31, 2015 had opted to charge the transitional impact (after retaining the residual value) whose remaining useful life is Nil as at July 1, 2014 to the Statement of Profit and Loss. However, the Company has as at the end of the year revisited the option and as permitted by the said notification, charged an amount of Rs. 10,582,546/- (Net of Deferred Tax Rs. 5,600,697/- to the retained earnings.

11. Based on the audited financial statements of Centrum Capital Holdings LLC ('CCHLLC' - audited by a firm of Chartered Accountants other than Haribhakti & Co. LLP) for year ended June 30, 2015, it has incurred losses of Rs. 270,683/- (P.Y Rs. 28,066/-). Accordingly, on the basis of financial estimates provided by the management of CCHLLC confirming fair valuation higher than the cost of Investments in CCHLLC in the books of the Company and which is duly approved by the Audit Committee of the Board of Directors of the Company, the management of the Company believes that no impairment is necessitated in respect of said Investments.

12. (a) During the period, The Company, for strategic reasons and to better align its various businesses, has reorganized the Centrum Group Structure by transferring its entire equity investments in its subsidiaries viz. Centrum Wealth Management Limited, Centrum Financial Services Limited and Centrum Direct Limited to a newly formed subsidiary viz. Centrum Retail Services Limited (Formerly known as Centrum Retail Financial Services Limited) and has also incorporated two new subsidiaries viz. Centrum Infrastructure Advisory Limited and Centrum Defence Systems Limited.

(b) During the year, the company has sold its investments of Rs. 500,000/- in Centrum Infrastructure & Realty Limited (CIRL) at book value. Consequent upon which, CIRL is no longer a subsidiary of the company as on the balance sheet date.

13. Pursuant to divestment by the company of its 10% stake in subsidiary Centrum Retail Services Limited (CRSL) (formerly known as Centrum Retail Financial Services Limited) to two strategic investors at an aggregate consideration of Rs. 184,419,034/-, an amount of Rs. 164,419,034/- (net after adjusting Rs. 20,000,000/- received till year end) is receivable, which is reflected in Note No. 18 "Other Current Assets" under head "Other Receivable". Against the said outstanding, the company has since realized an amount of Rs. 46,104,730/- and expects to receive the balance consideration in due course.

14. Prior Year Comparatives

The Figures for the previous year have been regrouped/ rearranged wherever necessary to conform to current year's classification.


Jun 30, 2014

1. Segment Information

Business Segment

The Company has for the purpose of segment reporting identified two major businesses i.e. Investment Banking and Trading in Bonds. Segments have been identified and reported based on the nature of operation involved, the risks and returns, the organization structure and the internal financial reporting systems.

Segment information for secondary segment reporting (by geographical segment). Company’s operations are mainly conducted in India. Company has a representative ofce at Dubai. Consequently the commercial risks and returns involved the basis of geographic segmentation is relatively insignificant. Accordingly, secondary segment disclosures based on geographic segments have not been reported.

Segment wise information for the year ended 30th June 2014 (i) Information about Primary business Segments.

(i) All of the Company’s operations are conducted in India. Consequently the commercial risks and returns involved on the basis of geographic segmentation are relatively insignificant.Accordingly, secondary segment disclosures based on geographic segments have not been reported.

(ii) The Company is organised into two main business segments namely:

- Investments Banking - Comprising financial services and merchant banking activities.

- Trading in Bonds - Comprising of purchase and sale of bonds.

(iii) Items that relate to the enterprise as a whole or at corporate level not attributable to a particular segment are included under “Unallocated”. (iv) There are no Intersegment transfers.

2. Related Party Disclosures

(i) Names of Related Parties

In terms of Accounting Standard 18 (AS-18) ‘Related Party Disclosures’, notifed in the Companies (Accounting Standards) Rules, 2006, the disclosures of transactions with the related parties as Defined in AS-18 are given below :

Subsidiary Companies :

- CentrumDirect Limited

- Centrum Financial Services Limited

- Centrum Wealth Management Limited

- Centrum Broking Limited

- Centrum Infrastructure & Realty Limited

- Centrum Capital Holdings LLC

- Accounts Receivable Management Services (India) Limited (Upto May 15, 2014)

Stepdown Subsidiaries :

- Club 7 Holidays Limited (Subsidiary of CentrumDirect Limited)

- Centrum Securities LLC (Subsidiary of Centrum Capital Holdings LLC)

Joint Ventures : - Commonwealth Centrum Advisors Limited Names of other related parties with whom transactions have taken place during the year

Enterprise controlled by Key Management Personnel:

- Businessmatch Services (India) Private Limited

- Sonchajyo Investments & Finance Private Limited

Associates / entities where company has significant infuence

- Centrum Securities Private Limited

- Essel Centrum Holdings Limited

Key Management Personnel

- Mr. P. R. Kalyanaraman, Managing Director

- Mr. Chandir Gidwani, Non Executive Chairman

- Mr. Alpesh Shah, Company Secretary

3. Operating lease

i) The Company has entered into cancellable leasing arrangements for corporate and branch ofces and residential premises. The lease rentals of Rs. 46,913,171/- (previous year Rs. 2,250,358/-) have been included under the head Rent under Note 23 of Statement of profit and Loss.

ii) The Company has also entered into non-cancellable leasing arrangement for corporate ofce.

* Includes Rent amounting to Rs. 60,029,730/- (P.Y Rs. 50,457,013/-) which company has inturn recovered from its group companies.

General description of Company’s significant leasing arrangement:

Corporate Ofce premises in Mumbai are obtained on operating lease. The lease rent payable is Rs. 85,84,800/- per month for the period July 1, 2013 to November, 2013.The lease rent was revised in December 2013 and consequently the lease rent payable is Rs. 90,14,040/- per month for the period December 01, 2013 to June 30, 2014.

The lease term is for a period of 4 years with a lock in period of 12 months and thereafter as per the mutual agreement between the lessor and the Company. There is an escalation clause in the lease agreement @ 5 % every year which will be reviewed mutually every year by the Company and the lessor hence efect of escalation is not taken in the above disclosure.

4. Interest in joint venture

The Company have 50% interest in Commonwealth Centrum Advisors Limited Accordingly, the following disclosures include Balance Sheet as well as profit & Loss numbers of Commonwealth Centrum Advisors Limited.

5. (a) Contingent Liabilities not provided for

(Rs) Particulars 30th June, 2014 30th June, 2013

Corporate Guarantees given by the company :

- Subsidiary 977,500,000 967,500,000

Partly paid equity shares of Essel- Centrum Holdings Limited 4,000,000 4,000,000

Income Tax in respect of Assessment Year 2008-2009 in respect of 848,030 848,030

which the Company has gone on appeal

Income Tax in respect of Assessment Year 2010-2011 in respect of 11,310,700 11,310,700

which the Company has gone on appeal

Income Tax in respect of Assessment Year 2011-2012 in respect of 8,326,840 NIL

which the Company has gone on appeal

(b) In view of assessment order received from income tax authorities demanding Rs. 2,696,060/- towards liability on account of disallowance under Section 14A of Income Tax Act, 1961 for assessment year 2008-2009, based on the facts / merits of the case under question, the Company has duly preferred an appeal and also paid Rs 1,348,030/- (i.e. 50% of the IT demand vide challan no 56091 dated 28/03/2011) and Rs 500,000/- (Paid on 07/09/2011) and no provision is considered necessary by the management of the Company.

(c) In view of assessment order received from income tax authorities demanding Rs. 11,310,700/- primarily on account of disallowance under Section 14A of Income Tax Act, 1961 for assessment year 2010-2011, based on the facts / merits of the case under question, the Company has duly preferred an appeal. Hence on the basis of facts of the case, no provision is considered necessary by the management of the Company.

(d) In view of assessment order received from income tax authorities demanding Rs. 8,326,840/- primarily on account of disallowance under Section 14A of Income Tax Act, 1961 for assessment year 2011-2012, based on the facts / merits of the case under question, the Company has duly preferred an appeal. Hence on the basis of facts of the case, no provision is considered necessary by the management of the Company.

6. Gratuity and Post employment benefit plans

Short Term Employee benefits

Liability in respect of short term compensated absences is accounted for at undiscounted amount likely to be paid as per entitlement.

Defined Contribution Plan

Retirement benefits in the nature of Provident Fund, Superannuation Scheme and others which are Defined contribution schemes, are charged to the Statement of profit and Loss of the year when contributions accrue.

Defined benefit Plan

The liability for Gratuity, a Defined benefit obligation, is accrued and provided for on the basis of actuarial valuation using the Projected Unit Credit method as at the Balance Sheet date

Other Long Term benefits

Long term compensated absences are provided on the basis of an actuarial valuation using the Projected Unit Credit method as at the Balance Sheet date. Actuarial gains and losses comprising of experience adjustments and the efects of changes in actuarial assumptions are recognised in the Statement of profit and Loss for the year as income or expense.

Disclosure Under AS – 15 (Revised 2005)

Company has adopted the Accounting Standard (AS – 15) (Revised 2005) “Employee benefits” efective April 01, 2007.

I. Defined Contribution Plans: The Company has classified the various benefits provided to employees as under:

a. Provident Fund

b. Employers’ Contribution to Employees’ State Insurance

The provident fund and the state Defined contribution plan are operated by the Regional Provident Fund Commissioner and the Superannuation Fund is administered by the Trustee of the Life Insurance Corporation. Under the schemes, the Company is required to contribute a specified percentage of payroll cost to the retirement benefit schemes to fund the benefits. These funds are recognized by the Income Tax authorities.

II. Defined benefit Plans

(a) Contribution to Gratuity Fund (Funded Scheme):

In accordance with the Accounting Standard (AS - 15) (Revised 2005), actuarial valuation was performed by independent actuaries in respect of the aforesaid Defined benefit plan based on the following assumptions:

7. Derivative Instruments and Un-hedged Foreign Currency Exposure

i. There were no contracts outstanding as at balance sheet date.

ii. Particulars of Unhedged Foreign Currency Exposure are detailed below at the exchange rate prevailing as at balance sheet date

8. Deferred Tax Asset / Liability

In accordance with the Accounting Standard 22 on Accounting for Taxes on Income, the Company has made adjustments in its accounts for deferred tax liabilities / assets.

The tax efects of significant temporary diferences that resulted in deferred tax assets and liabilities are:

9. During the previous year, the Company had held Extraordinary general meeting on June 13, 2013, wherein members have approved increase in authorized capital from Rs. 100,000,000 (Rupees Ten Crores) divided into 1,00,00,000 equity shares of Rs. 10/- each to Rs. 420,000,000 (Rupees Forty Two Crores) divided into 4,20,00,000 equity shares of Rs. 10 each.

Members have also approved sub division of Equity shares of Face Value of Rs. 10/- each into Equity shares of Rs. 1/- each and Issue of Bonus Equity Shares in the ratio of 5:1 after subdivision of shares. The subdivision was efective and simultaneous with the allotment of Bonus shares by the Board or as per the advice of the Stock Exchange. BSE has issued a notice vide Notice Number 20130619-23 dated June 19, 2013 informing the Trading Members that record date for sub division and bonus issue will be on July 04, 2013.

Consequent upon which, subsequent to balance sheet date the Company has sub divided equity share of Rs.10 /- each to 10 shares of Rs. 1/- each. Further vide board resolution dated July 08, 2013, Company has allotted Bonus Shares in the proportion of 5 (Five) Equity Share of Rs. 1/- each for every 1 (One) Equity Share of Rs. 1/- each by capitalizing Rs. 346,693,950/- out of its Securities Premium Account.

10. During the previous year, BrihanMumbai Municipal Corporation (BMC) had made downward revision in property tax rate with retrospective efect from April 2010 and company being a benefciary had recognized the refund of Rs. 27,442,679/- against the property taxes paid for period April 2010 to March 2012 and reversal of Rs. 2,762,780/- for excess property tax provided for period April 2012 to June 2012. The Company had recognized the same as income amounting to Rs. 30,205,459/- as shown in Statement of profit and loss under the head exceptional items.

11. During the year, the company has repaid Rs. 240,000,000/- out of the loan of Rs. 620,000,000/- availed from its than JV partner, for the purpose of buying out the stake of its JV partner in CentrumDirect Limited. In light of the above both parties have reached an in-principle understanding that interest on the said loan will not be payable with efect from April 01, 2013.

12. The Company has a process of identifcation of ‘suppliers’ registered under the Micro, Small and Medium Enterprises Development (‘MSMED’) Act, 2006, by obtaining confirmations from all suppliers. The Company has not received intimation from all the ‘suppliers’ regarding their status under MSMED Act, 2006 and hence disclosures if any, relating to amounts unpaid as at the year end together with interest paid/payable as required have not been furnished.

13. Trade Receivables are subject to confirmations, reconciliations and adjustments, if any, arising there from.

14. The Company has long outstanding trade receivable amounting to Rs. 45,832,632/-(P.Y. Rs. 45,832,632/-).Based on recent trends in collection and status of ongoing lawsuit; the above amount, in view of the management, is fully recoverable and accordingly the same need not be subject to any provisioning.

15. a) Based on the audited financial statements of Centrum Broking Limited (‘CBL’ - audited by a firm of Chartered Accountants other than Haribhakti & Co. LLP) for year ended June 30, 2014, it has incurred losses of Rs. 28,635,539/- (P.Y Rs. 44,948,659 /-). Accordingly, on the basis of financial estimates provided by the management of CBL confirming fair valuation higher than the cost of Investments in CBL in the books of the Company and which is duly approved by the Audit Committee of the Board of Directors of the Company, the management of the Company believes that no impairment is necessitated in respect of said Investments.

b) Based on the audited financial statements of Centrum Capital Holdings LLC (‘CCHLLC’ - audited by a firm of Chartered Accountants other than Haribhakti & Co. LLP) for year ended June 30, 2014, it has incurred losses of Rs. 28,066/- (P.Y Rs. 132,692/-). Accordingly, on the basis of financial estimates provided by the management of CCHLLC confirming fair valuation higher than the cost of Investments in CCHLLC in the books of the Company and which is duly approved by the Audit Committee of the Board of Directors of the Company, the management of the Company believes that no impairment is necessitated in respect of said Investments.

c) Based on the audited financial statements of Centrum Wealth Management Limited (‘CWML’ - audited by a firm of Chartered Accountants other than Haribhakti & Co. LLP) for year ended June 30, 2014, it has incurred losses of Rs. 59,945,030/- (P.Y Rs. 42,126,272 /-). Accordingly, on the basis of financial estimates provided by the management of CWML confirming fair valuation higher than the cost of Investments in CWML in the books of the Company and which is duly approved by the Audit Committee of the Board of Directors of the Company, the management of the Company believes that no impairment is necessitated in respect of said Investments.

16. During the year, the Company has paid in full, service tax dues under the Service Tax Voluntary Compliance Encouragement Scheme (VCES), towards short payment of service tax for the period April 2012 to December 2012 amounting to Rs. 74,557,031/- wherein the above service tax liability can be paid in future years without any Interest and penalty thereon.

17. During the year, the company has sold its investments of Rs. 400,000/- in Accounts Receivables Management Services (India) Limited (ARMS) at book value. Consequent upon which, ARMS is no longer a subsidiary of the company as on the balance sheet date.

18. Prior Year Comparatives

The Figures for the previous year have been regrouped/ rearranged wherever necessary to conform to current year’s classification.


Jun 30, 2013

1. Nature of Operations

Centrum Capital Limited (the ''Company'') is an Investment Banking Company and a SEBI Registered Category-I Merchant Banker. The Company ofers a complete gamut of fnancial services in the areas of equity capital market, private equity, corporate fnance, project fnance, stressed asset resolution. The Company is also engaged in trading of bonds.

2. Segment Information

Business Segment

The Company has for the purpose of segment reporting identifed two major businesses i.e. Investment Banking and Trading in Bonds. Segments have been identifed and reported based on the nature of operation involved, the risks and returns, the organization structure and the internal fnancial reporting systems.

Segment information for secondary segment reporting (by geographical segment). Company''s operations are mainly conducted in India. Company has a representative ofce at Dubai. Consequently the commercial risks and returns involved the basis of geographic segmentation is relatively insignifcant. Accordingly, secondary segment disclosures based on geographic segments have not been reported.

3. Operating lease

i) The Company has entered into cancellable leasing arrangements for corporate and branch ofces and residential premises. The lease rentals of Rs. 2,250,358/- (previous year Rs. 8,294,230/-) have been included under the head Rent under Note 14 of Statement of Proft and Loss.

ii) The Company has also entered into non-cancellable leasing arrangement for corporate ofce.

General description of Company''s signifcant leasing arrangement:

Corporate Ofce premises in Mumbai are obtained on operating lease. The lease rent payable (including amenities) is Rs. 9,977,527/- per month for the period July, 2012 to November, 2012. The lease rent was revised in December 2012 and consequently the lease rent payable(excluding amenities) is Rs. 8,584,800/- per month for the period 1st December, 2012 to 30th June, 2013.

The lease term is for a period of 4 years with a lock in period of 12 months and thereafter as per the mutual agreement between the lessor and the Company, there is an escalation clause in the lease agreement @ 5 % every year which will be reviewed mutually every year by the Company and the lessor hence efect of escalation is not taken in the above disclosure.

4. Interest in joint venture

The Company have 50% interest in Commonwealth Centrum Advisors Limited Accordingly, the following disclosures include Balance Sheet as well as Proft & Loss numbers of Commonwealth Centrum Advisors Limited.

5. Allotment to Centrum ESPS Trust as per Securities and Exchange Board of India (Employee Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines, 1999

The Company had allotted 409,686 Equity Shares of Rs. 10/- each at a premium of Rs. 740.05 per share aggregating to Rs. 750.05 per share to Centrum ESPS Trust during the fnancial year 2010-2011. The face value of Rs. 10/- per share payable on the said shares was received during year ended 2011. During the year ended June 2012 the company has received the premium amount payable on the said shares by using the proceeds of loan taken from the Company. The Trust will allocate the said shares as per the resolutions passed in the meeting of the shareholders of the Company and in accordance with the terms and conditions mentioned in the Employee Stock Purchase Scheme 2008 approved by the Remuneration/Compensation Committee of the Board of the Company.

6. (a) Contingent Liabilities not provided for

(Rs.) Particulars 30th June, 2013 30th June, 2012

Corporate Guarantees given by the company :

- Subsidiary 967,500,000 967,500,000

Partly paid equity shares of Essel-Centrum Holdings Limited 4,000,000 4,000,000

Income Tax in respect of Assessment Year 2008-2009 in respect of 2,696,060 2,696,060 which the Company has gone on appeal

Income Tax in respect of Assessment Year 2010-2011 in respect of 11,310,700 which the Company has gone on appeal

7. (b) In view of assessment order received from income tax authorities demanding Rs. 2,696,060/- towards liability on account of disallowance under section 14A of Income Tax Act, 1961 for assessment year 2008-2009, based on the facts / merits of the case under question, the Company has duly preferred an appeal and also paid Rs. 1,348,030/- (i.e. 50% of the IT demand vide challan no 56091 dated 28th March 2011) and Rs. 500,000/- (Paid on 7th September 2011) and no provision is considered necessary by the management of the Company.

8. (c) In view of assessment order received from income tax authorities demanding Rs. 11,310,700/- primarily on account of disallowance under section 14A of Income Tax Act, 1961 for assessment year 2010-2011, based on the facts / merits of the case under question, the Company has duly preferred an appeal. Hence on the basis of facts of the case, no provision is considered necessary by the management of the Company.

9. Gratuity and Post employment beneft plans

The Company has a defned beneft gratuity plan. Every employee who has completed 5 years or more of service gets a gratuity on leaving the services of the Company, at 15 days salary (last drawn basic salary) for each completed year of service. The Company makes contribution to an approved gratuity fund which is covered under the group gratuity scheme of the Life Insurance Corporation of India.

The following table summarizes the components of net beneft expense recognized in the Statement of Proft and Loss and funded status and amount recognized in the balance sheet for gratuity.

10. During the year, company had held Extraordinary general meeting on 13th June 2013, wherein members have approved increase in authorized capital from Rs. 100,000,000 (Rupees Ten Crores) divided into 10,000,000 equity shares of Rs. 10/- each to Rs. 420,000,000 (Rupees Forty Two Crores) divided into 42,000,000 equity shares of Rs. 10 each.

Members have also approved sub division of Equity shares of Face Value of Rs. 10/- each into Equity shares of Rs. 1/- each and Issue of Bonus Equity Shares in the ratio of 5:1 after subdivision of shares. The subdivision was efective and simultaneous with the allotment of Bonus shares by the Board or as per the advice of the Stock Exchange.BSE has issued a notice vide Notice Number 20130619-23 dated 19th June, 2013 informing the Trading Members that record date for sub division and bonus issue will be on 4th July 2013.

Consequent upon which, subsequent to balance sheet date the company has sub divided equity share of Rs.10 /- each to 10 shares of Rs. 1/- each. Further vide board resolution dated 8th July 2013, company has allotted Bonus Shares in the proportion of 5 (Five) Equity Share of Rs. 1/- each for every 1 (One) Equity Share of Rs. 1/- each by capitalizing Rs. 346,693,950/- out of its Securities Premium Account.

Basic and diluted earning per Share (for current year and previous year) has been restated on the basis of new number of equity shares.

11. During the year, BrihanMumbai Municipal Corporation (BMC) has made downward revision in property tax rate with retrospective efect from April 2010 and company being a benefciary recognized the refund of Rs. 27,442,679/- against the property taxes paid for period April 2010 to March 2012 and reversal of Rs. 2,762,780/- for excess property tax provided for period April 2012 to June 2012.

The Company has recognized the same as income amounting to Rs. 30,205,459/- as shown in Statement of Proft and loss under the head exceptional items.

12. The Company has a process of identifcation of ''suppliers'' registered under the Micro, Small and Medium Enterprises Development (''MSMED'') Act, 2006, by obtaining confrmations from all suppliers. The Company has not received intimation from all the ''suppliers'' regarding their status under MSMED Act, 2006 and hence disclosures if any, relating to amounts unpaid as at the year end together with interest paid/payable as required have not been furnished.

13. Trade Receivables are subject to confrmations, reconciliations and adjustments, if any, arising there from.

14. The Company has long outstanding trade receivable amounting to Rs. 45,832,632/-(P.Y. Rs. 64,953,975/-).Based on recent trends in collection, sale of pledge shares and status of ongoing lawsuit; the above amount, in view of the management, is fully recoverable and accordingly the same need not be subject to any provisioning.

15. (a) Based on the audited fnancial statements of Centrum Broking Limited (''CBL'' - audited by a frm of Chartered Accountants other than Haribhakti & Co.) for year ended 30th June, 2013, it has incurred losses of Rs. 44,948,659 (P.Y Rs. 157,374,186/-). Accordingly, on the basis of fnancial estimates provided by the management of CBL confrming fair valuation higher than the cost of Investments in CBL in the books of the Company and which is duly approved by the Audit Committee of the Board of Directors of the Company, the management of the Company believes that no impairment is necessitated in respect of said Investments.

15. (b) Based on the audited fnancial statements of Centrum Infrastructure & Reality Limited (''CIRL'' - audited by a frm of Chartered Accountants other than Haribhakti & Co.) for year ended 30th June, 2013, it has incurred losses of Rs. 13,092,746 (P.Y Rs.14,615,068/-). Accordingly, on the basis of fnancial estimates provided by the management of CIRL confrming fair valuation higher than the cost of Investments in CIRL in the books of the Company and which is duly approved by the Audit Committee of the Board of Directors of the Company, the management of the Company believes that no impairment is necessitated in respect of said Investments.

15. (c) Based on the audited fnancial statements of Centrum Wealth Management Limited (''CWML'' - audited by a frm of Chartered Accountants other than Haribhakti & Co.) for year ended 30th June, 2013, it has incurred losses of Rs. 42,126,272 (P.Y Rs.169,142,445/-). Accordingly, on the basis of fnancial estimates provided by the management of CWML confrming fair valuation higher than the cost of Investments in CWML in the books of the Company and which is duly approved by the Audit Committee of the Board of Directors of the Company, the management of the Company believes that no impairment is necessitated in respect of said Investments.

16. The Company intends to opt for Service Tax Voluntary Compliance Encouragement Scheme (VCES), for short payment of service tax for the period from April 2012 to December 2012 amounting to Rs. 74,557,031/- wherein the above service tax liability can be paid in future years without any Interest and penalty thereon.

17. During the previous year, the Company had initiated the process of liquidation of Centrum Securities (Europe) Limited, London, a Wholly Owned Subsidiary of the Company. Further as per the Statement of accounts from liquidator, the Company has written of Rs. 5,067,371/- in previous year and Euro 7136.45 (Rs. 532,879/-) is recoverable against the balance of investments.

Further amount receivable of Rs. 532,879/-from Centrum Securities (Europe) Limited is shown under the head Investment in the previous year have been reclassifed under the head Short Term Loans and Advances.

18. Prior Year Comparatives

The Figures for the previous year have been regrouped/ rearranged wherever necessary to conform to current year''s classifcation


Jun 30, 2009

1. Nature of Operations

Centrum Capital Limited (the Company) is an Investment banking Company and a Category-I Merchant Banker. The Company is engaged in equity capital market, private equity, corporate finance, project finance, stressed asset resolution and offers a complete gamut of financial services. The Company is also engaged in trading of bonds.

2. Sundry debtors includes Rs. 226,985,560 (Previous year Rs. 219,987,974), amount overdue for more than 6 months Rs. 208,609,862 (Previous year Rs. 183,527,154) receivable from certain parties. These parties have confirmed the balance outstanding, as at June 30, 2009 and in view of the management no provision is considered necessary.

3. Segment Information

Business Segment:

As of June 30, 2009, the Company has for the purpose of segment reporting identified two major businesses i.e. Investment Banking and Trading in bonds. Segments have been identified and reported based on the nature of operation involved, the risks and returns, the organization structure and the internal financial reporting systems.

Segment information for secondary segment reporting (by geographical segment):

Companys operations are mainly conducted in India. Company has a representative office at Dubai.

Consequently the commercial risks and returns involved the basis of geographic segmentation are relatively insignificant. Accordingly, secondary segment disclosures based on geographic segments have not been reported.

Segment wise details are given in Annexure -1.

4. Related Party Disclosures

In terms of Accounting Standard 18 (AS-18) Related Party Disclosures, notified in the Companies (Accounting Standards) Rules, 2006, the disclosures of transactions with the related parties as defined in AS-18 are given below:

Subsidiary Companies (Refer note 19 of schedule 16)

Centrum Infrastructure & Realty Limited

Centrum Financial Services Limited (Formerly known as Shri Santram Finance Limited) w.e.f. March 2, 2009

Centrum Investments Limited

Accounts Receivables Management Services (I) Limited w.e.f. August 8, 2008

Centrum Capital Holdings LLC w.e.f. August 5, 2008

Centrum Securities LLC (Subsidiary of Centrum Capital Holdings LLC)

Joint Ventures

(Refer note 19 of schedule 16)

FCH CentrumDirect Limited) formerly known as CentrumDirect Limited) FCH Centrum Wealth Managers Limited(formerly known as Centrum Wealth Managers Limited)

i Names of other related parties with whom transactions have taken place during the year:

Enterprise controlled by Key Management Personnel

Businessmatch Services (India) Private Limited

P & M Infrastructure Limited

Centrum Fiscal Private Limited

Sonchajyo Investments & Finance Private Limited

Associates / entities where company has significant influence

Centrum Broking Private Limited

Centrum Securities Private Limited

Club 7 Holidays Limited! formerly known as Club 7 Holidays Private Limited)

(Subsidiary of FCH CentrumDirect Limited, w.e.f.December 12, 2008) Centrum ESPS Trust

Key Management Personnel

Mr. Chandir Gidwani, Chairman

Mr. T. R. Madhavan, Managing Director

Ms. Sonia Gidwani, Whole Time Director

5. Interest in joint venture

The Company has a 50% interest in the assets, liabilities, expenses and income of FCH CentrumDirect Limited engaged in money changing business and FCH Centrum Wealth Managers Limited engaged in the business of wealth management and distribution of investment products.

6. Allotment to Centrum ESPS Trust as per Securities and Exchange Board of India (Employee Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines, 1999

In the previous year, the Company had allotted 409,686 Equity Shares of Rs.10/- each at a premium of Rs.740.05 per share aggregating to Rs.750.05 per share to Centrum ESPS Trust. The face value of Rs.10/- per share payable on the said shares has been received by the Company by using the proceeds of loan taken from the Company. The premium amount shall be accounted as and when received. The Trust will allocate the said shares as per the resolutions passed in the meeting of the shareholders of the Company and in accordance with the terms and conditions mentioned in the Employee Stock Purchase Scheme 2008 approved by the Remuneration/ Compensation Committee of the Board of the Company.

7. Contingent Liabilities not provided for Rupees

Particulars As at June 30, 09 As at June 30, 08

Corporate Guarantees given by the Company:

(i) Associate 660,100,000 310,100,000

(ii) Joint Ventures Limit 390,000,000 310,000,000

Outstanding 287,541,695 198,467,891 Partly paid equity shares of Essel Centrum Holdings Limited 4,000,000 4,000,000

8. Gratuity and Post employment benefit plans

The Company has a defined benefit gratuity plan. Every employee who has completed 5 years or more of service gets a gratuity on leaving the services of the Company, at 15 days salary (last drawn basic salary) for each completed year of service. The Company makes contribution to an approved gratuity fund which is covered under the group gratuity scheme of the Life Insurance Corporation of India.

The following table summaries the components of net benefit expense recognized in the Profit and Loss account and funded status and amount recognized in the balance sheet for gratuity.

9. Derivative Instruments and Un-hedged Foreign Currency Exposure

i. There were no contracts outstanding as at balance sheet date.

ii. Particulars of Unhedged Foreign Currency Exposure are detailed below at the exchange rate prevailing as at balance sheet date

10. Deferred Tax Asset / Liability

In accordance with the Accounting Standard 22 on Accounting for Taxes on Income, the Company has made adjustments in its accounts for deferred tax liabilities / assets.

11. The Company has initiated the process of identification of suppliers registered under the Micro, Small and Medium Enterprises Development (MSMED) Act, 2006, by obtaining confirmations from all suppliers. The Company has not received intimation from all the suppliers regarding their status under MSMED Act, 2006 and hence disclosures if any, relating to amounts unpaid as at the year end together with interest paid/payable as required have not been furnished.

12. During the year, 0.1% share holding of FCH Centrum Wealth Managers Limited and FCH CentrumDirect Limited was transferred from Future Capital Holdings Limited (FCH) to Centrum Capital Limited (CCL), in accordance with the Joint Venture Agreement executed on 11th March 2008 between CCL and FCH, the same are now 50:50 joint venture partners effective June 12, 2009 and June 16, 2009 respectively. This has resulted in a change in the status of FCH CentrumDirect Limited and FCH Centrum Wealth Managers Limited from subsidiaries of CCL (by virtue of control till previous year) to Joint Ventures between CCL and FCH.

13. Previous year comparatives

Previous years figures have been regrouped / rearranged wherever necessary to conform to current years classification.

The figures of previous year were audited by a firm of Chartered Accountants other than S.R.Batliboi & Co.

 
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