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Notes to Accounts of Fortune Financial Services (India) Ltd.

Mar 31, 2016

1. Segment reporting

The Company is primarily engaged in the business of financial advisory and consultancy services. All the activities of the Company revolve around the main business. Further, the Company does not have any separate geographic segments other than India. There are no separate reportable segments as per Accounting Standard 17 on "Segment Reporting" (AS-17) issued by the Institute of Chartered Accountants of India.

2. Related party Transactions

Details of the related parties with whom transactions were carried out during the year along with a description of the relationship and the

amounts involved are provided below.

a) Names of related parties and nature of relationship

i) Related parties where control exists

In time Equities Limited Subsidiary

Fortune Credit Capital Limited Subsidiary

In time Multi Commodity Company Limited Subsidiary

ITI Investment Advisors Limited Subsidiary

Fortune Integrated Home Finance Limited Subsidiary

Antique Stock Broking Limited Subsidiary

Inga Capital Private Limited Subsidiary

Distress Asset Specialist Private Limited ( wef 01.09.2015) Subsidiary

ITI Wealth Management Private Limited (wef 23.10.2015) Subsidiary

Kohinoor India Reinsurance Co. Limited (wef 30.03.2016) Subsidiary

Neue Allianz Corporate Services Private Limited Step down subsidiary

ii) Enterprises having significant influence

Fortune Integrated Assets Finance Limited (wef 30.04.2015) Associate

United Petro Finance Limited (wef 30.03.2016) Associate

iii) Key managerial personnel and their relatives

Mr. YashpalMadan (upto 30.07.2015) Manager

Mr. Aalok Dave (w.e.f 31.07.2015) Manager

Mr. S. G. Muthu Kumar Chief Financial Officer

3. The Company has taken office premises under operating lease . These agreements provide an option to the Company to renew the lease period on mutually agreeable terms. The Company has given refundable interest free security deposits in accordance with the agreed terms. The rental expense in respect of the operating leases, recognized in the Statement of Profit and Loss as "Rent" in Note "19" is Rs. 47.63 lakhs (previous year Rs.43.32 lakhs). Details of the minimum lease payments for the operating leases are provided hereunder:

4. Contingent Liabilities and Capital Commitments ( to the extent not provided for)

a) Corporate guarantee issued in favour of a banks to secure credit facilities sanctioned by the banks to subsidiary companies Rs.22,500 lakhs ( Previous year Rs.28,000 lakhs)

b) Claims not acknowledged by the Company relating to income tax Rs. 38.82 lakhs ( Previous year Rs.37.97 lakhs)

5. Exceptional Item represents profit on sale of Investment in Fortune Integrated Assets Finance Limited.

6. Rights issue of the Company comprising 22,677,777 (Two crores twenty six Lakhs seventy seven thousand seven hundred seventy seven) equity shares of Rs. 10 each at a price of Rs. 90/- (including premium of Rs.80/- each) per equity share aggregating to Rs 20,410.00 lakhs to its existing equity shareholders was made open for subscription on March 28, 2016 and concluded on April 12, 2016. The Share application money pending allotment received upto March 31, 2016 is held in escrow account. The Company has allotted aforesaid shares on April 25, 2016.

7. "The Scheme of Amalgamation ("Scheme") between ITI Wealth Management Private Limited ("Transferor Company") and Fortune Financial Services (India) Limited ("Transferee Company") with effect from "appointed date" of 1st January, 2016 is awaiting approval of High Court of Bombay and Chennai under section 391 to 394 of the companies Act, 1956 and to the extent applicable, provisions of the Companies Act, 2013. As the approval of Hon''ble High Court of Bombay and Chennai is awaited thus the amalgamation though effective from "appointed date" 1st January, 2016 shall be operative from "effective date" i.e. the last of date on which all the consents and approvals referred to in the Scheme are obtained or waived. As approvals and sanctions of the Scheme from the Hon''ble High Court of Bombay and Chennai are pending, Company''s accounts have been prepared independently without giving effect of the Scheme. The effect of the above amalgamation will be given in the Annual Accounts of the Company, in the Financial Year in which all the sanctions or orders as specified in the Scheme of Amalgamation are obtained and/or filled.

8. There are no amounts payable to any micro, small and medium enterprises as identified by the management from the information available with the Company and relied upon by auditors.

9. In the opinion of the Management, the value of all Current Assets, Loans and Advances and other receivables is not less than their realizable value in the ordinary course of business.

10. Balances standing in debtors, creditors and loan and advances are subject to confirmation.

11. Previous year''s figures are reworked, regrouped, rearranged and reclassified wherever necessary, to conform to the current year''s classification.


Mar 31, 2015

1. Terms / Rights attached to Equity shares

The Company has only one class of equity shares having a par value of Rs.10 per share. Each holder of an equity share is entitled to one vote per share on every resolution placed before the Company on the right to receive dividend. In the event of liquidation of the Company, the holder of equity shares will be entitled to receive remaining assets of the Company, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders.

2. Segment reporting

The Company is primarily engaged in the business of financial advisory and consultancy services. All the activities of the Company revolve around the main business. Further, the Company does not have any separate geographic segments other than India. There are no separate reportable segments as per Accounting Standard 17 on "Segment Reporting" (AS-17) issued by the Institute of Chartered Accountants of India.

3. Related party Transactions

Details of the related parties with whom transactions were carried out during the year alongwith a description of the relationship and the

amounts involved are provided below.

a) Names of related parties and nature of relationship

i) Related parties where control exists

Intime Equities Limited Subsidiary

Fortune Credit Capital Limited Subsidiary

Intime Multi Commodity Company Limited Subsidiary

Fortune Integrated Assets Finance Limited Subsidiary

ITI Investment Advisors Limited Subsidiary

Fortune Integrated Home Finance Limited Subsidiary

Antique Stock Broking Limited Subsidiary

Inga Capital Private Limited ( w.e.f. 26-02-2015) Subsidiary

ITI Financial Services Limited ( w.e.f. 16-10-2014) Step down subsidiary

ITI Investor Services Limited ( w.e.f. 16-10-2014) Step down subsidiary

Neue Allianz Corporate Services Pvt. Ltd. (w.e.f. 26 - 02 -2015) Step down subsidiary

ii) Key management personnel and their relatives

Mr. Chintan V. Valia Director

Mr Nimish C Shah (up to 10-04-2014) Managing Director

Ms.Khyati Valia (w.e.f. 25-03-2015) Director

Mr. Yashpal Madan Manager

Mr. Muthu Kummar Chief Financial Officer

4.Contingent Liabilities and Capital Commitments ( to the extent not provided for)

a) Fixed deposits of the Company pledged with a bank for overdraft facility of a subsidiary Nil ( Previous year Rs.1,349.49 lakhs)

b) Guarantee given by the banks on behalf of Fortune Group in respect of capital adequacy, daily margin and other contractual commitments for capital market operations of its subsidiaries is Rs.5,843.75 lakhs ( Previous year Rs.6,786.25 lakhs)

Corporate guarantee issued in favour of a banks to secure credit facilities sanctioned by the banks to subsidiary companies Rs.28,000 lakhs ( Previous year Rs.6500 lakhs)

c) Claims not acknowledged by the Company relating to Income Tax Rs. 37.97 lakhs ( Previous year Rs.12.36 lakhs)

5. There are no amounts payable to any micro, small and medium enterprises as identified by the management from the information available with the Company and relied upon by auditors.

6. In the opinion of the Management, the value of all Current Assets, Loans and Advances and other receivables is not less than their realisable value in the ordinary course of business.

7. Balances standing in debtors, creditors and loan and advances are subject to confirmation.

8. Previous year's figures are reworked, regrouped, rearranged and reclassified wherever necessary, to conform to the current year's classification.


Mar 31, 2014

1 COMPANY OVERVIEW

Fortune Financial Services (India) Limited (the ''Company'') and its seven wholly owned Indian subsidiaries (collectively referred to as the "Group") is one of the hybrid players in the business that are present both in corporate finance as well as entire broking spectrum. The ''Group''s full service portfolio consists of investment banking and corporate finance activities on the capital market side as well as advisory services,broking services in the cash and future & options segments,currency derivatives, commodities,along with offering depository services, loan,portfolio management services and other wealth and distribution related products.

2 BASIS OF CONSOLIDATION

The Consolidated Financial Statements relate to Fortune Financial Services (India) Limited (the Company) and its subsidiaries (collectively referred to as "the Fortune Group").

3 SEGMENT REPORTING

Primary segment

Segments have been identified in accordance with Accounting Standard 17 ''Segment Reporting'', issued by the Institute of Chartered Accountants of India considering the organisation structure and return/risk profile of the businesses. The Management recognises and monitors these segments on a continuous basis

Secondary segment

The company does not have any separate geographical segment other than India.

4 Related party transactions

Names of related parties and nature of relationship

a) Enterprises having significant influence

Mehra Capital services Private Limited (up to 07-10-2013) Jamish Investment Private Limited Fortune Capital Services

b) Key management personnel and their relatives:

Mr. J.T. Poonja, Chairman (up to 07-10-2013) Mr. Nimish C. Shah, Managing Director Ms. Jalpa N Shah, Relative Ms. Vidhi N Shah, Relative

b) Defined Contribution Plans:

The amount recognised as expenses and included in "Contribution to gratuity, provident and other funds" in Note 20 is Rs. 44.89 lakhs (Previous year Rs. 49.53 lakhs).

c) General Description of significant defined benefit plan

Gratuity Plan : Gratuity is payable to all eligible employees of the Company in terms of the provision of the Payment of Gratuity Act, 1972

(II) Disclosure in respect of the Retirement Benefits for the subsidiary acquired on March 31, 2014.

i) Gratuity: Provision for the gratuity liability amounting to Rs. 16,86,193 (P.Y. Rs. 49,846) has been made during the year by the company based on the valuation report of the Life Insurance Corporation (Actuarial Valuer).

ii) Provident Fund: Provident Fund contributions are made to the Government Provident Fund Authority.

5 Contingent Liabilities and commitments ( to the extent not provided for)

a) Contingent liabilities

Guarantees given by banks on behalf of the Group In respect of capital adequacy, daily margin and other contractual commitments for capital market operations of the Company is Rs. 6,786.25 lakhs (Previous year Rs. 5,528.75 lakhs)

b) Estimated amount of contracts remaining to be executed on capital account Rs. 565.66 (Previous year Nil)

6. In accordance with a Memorandum of Understanding entered into during the year, the Company has acquired 100% of the equityshares of Antique Stock Broking Limited with effect from March 31, 2014 for Rs.12 crores. The acquired company is engaged in thebusiness of shares and stock broking. The acquisition is expected to synergise and lead to better utilisation of available resources among its subsidiaries and result in greater economies of scale.

7 a) In accordance with a Memorandum of Understanding entered into during the year, the Company has acquired 100% of the equity shares of Antique Stock Broking Limited with effect from March 31, 2014 for Rs. 12 cores. The acquired company is engaged in the business of shares and stockbroking. The acquisition is expected to synergise and lead to better utilisation of available resources among its subsidiaries and result in greater economies of scale.

b) The subsidiary discharged the consideration through bank payments and accordingly accounted for the acquisition under the purchase method recognizing the assets at fair value. The excess of purchase consideration paid by the subsidiary over the aggregate value of net assets acquired has been treated as Goodwill, to be amortized over a period of 5 years from the date of purchase.

8 Under Micro, Small and Medium Enterprises Development Act, 2006 which came into force from October 2, 2006, certain disclosures are required to be made relating to Micro, Small and Medium Enterprises. The Company has not yet commenced the process of compiling the relevant information from its suppliers about their coverage under the said Act and hence the relevant disclosures have not been made in the accounts. However, in the view of the Management, there is no possibility of any interest being payable to any supplier as the Company is prompt in making payments to its suppliers.

9. Profit and Loss of a new subsidiary has not been considered for the purpose of presenting the Consolidated result of operations and the consolidated cash flows as the acquisition of the subsidiary was completed on March 31, 2014.

10 In the opinion of Management, the value of all current assets, loans and advances and other receivables is not less than their realisable value in the ordinary course of business.

11 Balances standing in debtors, creditors and loan and advances are subject to confirmation.

12 Previous year''s figures are reworked, regrouped, rearranged and reclassified wherever necessary, to conform to the current year''s classification.


Mar 31, 2013

1 COMPANY OVERVIEW

Fortune Financial Services (India) Limited (''Fortune''or the Company) was incorporated on June 14, 1991 as a private limited company. It was subsequently converted into a public limited company on October 20, 1994. The company was made an initial public offer in February, 1995. The Company is presently listed on The Bombay Stock Exchange. The company has six wholly owned Indian subsidiaries for equity and commodity broking, financing and third party distribution activities. The company is SEBI registered Category - I Merchant Banker and a provider of Portfolio Management Services (PMS). Major activities include investment banking as well as corporate finance on the capital market side as well as advisory through well networked and entrenched in the corporate space.

2 SEGMENT REPORTING

The Company is primarily engaged in the business of investment and merchant banking activities. All the activities of the Company revolve around the main business. Further, the Company does not have any separate geographic segments other than India. There are no separate reportable segments as per Accounting Standard 17 on "Segment Reporting" (AS-17) issued by the Institute of Chartered Accountants of India.

3 RELATED PARTY TRANSACTIONS

Details of the related parties with whom transactions were carried out during the year alongwith a description of the relationship and the amounts involved are provided below.

a) Names of related parties and nature of relationship

i) Related parties where control exists (Subsidiary Companies)

Fortune Equity Brokers (India) Limited

Fortune Commodities & Derivatives (India) Limited

Fortune Credit Capital Limited

Fortune Financial India Insurance Brokers Limited

Fortune Integrated Home Finance Limited

Fortune Integrated Assets Finance Limited

ii) Enterprises having significant influence

Mehra Capital Services Private Limited Jamish Investment Private Limited Umrigar Investment Private Limited Fortune Capital Services J. T. Poonja ( HUF) Nimish C Shah ( HUF)

iii) Key management personnel and their relatives

Mr. J.T. Poonja, Executive Chairman

Mr. Nimish C Shah, Managing Director

Mrs. Sangeeta Poonja, Director (up to July 31, 2012)

Mr. Abhinay Poonja, Relative of a Director

Ms. Aparna Poonja, Relative of a Director

Mrs. Jalpa N. Shah, Relative of a Director

Ms. Vidhi Shah, Relative of a Director

Mrs. Indumati Shah, Relative of a Director

4 The Company has taken office premises under operating lease at various locations. These agreements provide an option to the Company to renew the lease period on mutually agreeable terms. The Company has given refundable interest free security deposits in accordance with the agreed terms.

The rental expense in respect of the operating leases, recognised in the Statement of Profit and Loss as "Rent" in Note "19" is Rs. 51.00 lakhs (previous year Rs.51.00 lakhs)

5 CONTINGENT LIABILITIES AND COMMITMENTS (TO THE EXTENT NOT PROVIDED FOR)

a) Fixed deposits of the Company pledged with a bank for overdraft facility of a subsidiary Nil (Previous year Rs.l 125.42 lakhs)

b) Guarantee given by the banks on behalf of Fortune Group in respect of capital adequacy, daily margin and other contractual commitments for capital market operations of the Company of its Subsidiaries is Rs.5,258.75 lakhs (Previous " year Rs.5,548.75 lakhs)

c) Estimated amount of contracts remaining to be executed on capital account Nil (Previous year Nil)

6 Under Micro, Small and Medium Enterprises Development Act, 2006 which came into force from October 2, 2006, certain disclosures are required to be made relating to Micro, Small and Medium Enterprises. The Company has not yet commenced the process of compiling the relevant information from its suppliers about their coverage under the said Act and hence the relevant disclosures have not been made in the accounts. However, in the view of the Management, there is no possibility of any interest being payable to any supplier as the Company is prompt in making payments to its suppliers.

7 In the opinion of Management, the value of all Current Assets, Loans and Advances and other receivables is not less than their realisable value in the ordinary course of business.

8 Balances standing in debtors, creditors and loan and advances are subject to confirmation.

9 Previous year''s figures are reworked, regrouped, rearranged and reclassified wherever necessary, to conform to the current year''s classification.


Mar 31, 2012

1 COMPANY OVERVIEW

Fortune Financial Services (India) Limited ('Fortune' or the Company) was incorporated on June 14, 1991 as a private limited company. It was subsequently converted into a public limited company on October 20, 1994. The company was made an initial public offer in February, 1995. The Company is presently listed on Bombay Stock Exchange. The company has four wholly owned Indian subsidiaries for equity and commodity broking, financing and third party distribution activities. The company is SEBI registered Category - I Merchant Banker and Portfolio Management Services (PMS). Major activities includes investment banking as well as corporate finance on the capital market side as well as advisory through well networked and entrenched in the corporate space.

a Terms / Rights attached to Equity shares

The Company has only one class of equity shares having a par value of Rs.10 per share. Each holder of an equity share is entitled to one vote per share.

During the year ended March 31, 2012 the amount of per share dividend recognized as distribution to equity shareholders was Rs.0.50 per share (March 31, 2011 Rs.2.00 per share)

In the event of liquidation of the Company, the holder of equity shares will be entitled to receive their share in the remaining assets of the Company, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders.

b The Company has not reserved any shares for issue of options and contracts / commitments for sale of shares / divestments; Other than issue against ESOPs as provided (in Rs.) below:

c During the period of five years preceding March 31, 2012

a) The Company has not allotted any shares pursuant to contract(s) without payment being received in cash

b) The Company has not allotted any bonus shares

c) The Company has not bought back any shares

d Employee Stock Option Plan ("ESOP")

The Employee Stock Option Plan provides that the Company's employee and those of its subsidiaries are granted options to acquire equity shares of the Company. The options may be exercised within a specified period.

The Company follows the intrinsic value method to account for its stock based compensation plans. Compensation cost is measured as the excess, if any of the fair market value of the underlying share over the exercise price.

The Company currently has two ESOP schemes, ESOP scheme 2006 and ESOP Scheme 2007. These schemes were duly approved by the Board of Directors and Shareholders in their respective meetings. The 2006 scheme provides for the issue of 522,500 options and 2007 scheme for 60,690 options to eligible employees. These schemes are administered by the Compensation Committee comprising four members, the majority of whom are independent directors.

As the exercise is made at the market price prevailing on the date of the grant, the issuance of equity shares pursuance to exercise of options does not affect the profit and loss of the Company.

Of the options exercised Nil (Previous year 155,500) options were exercised by the employees of the subsidiaries.

400.000 equity warrants of Rs.10 each issued on preferential basis to its promoters on September 13, 2010 ,have been lapsed during the year due to non-exercise of options by the holders of the equity warrants. The amount received on the above equity warrants Rs.180.00 lacs, has been forfeited by the Company and credited to Capital Reserve.

2. MONEY RECEIVED AGAINST SHARE WARRANTS

As at the beginning of the year, the Company had Rs.300 lacs, received as application money against 600,000 equity warrants of Rs.10 each at a premium of Rs.70 per warrant and 4, 00,000 equity warrants of Rs.10 each at a premium of Rs.170 per equity warrant issued on preferential basis to its promoters. In accordance with the terms of the issue, the holders of these warrants had the option to apply for one equity share of Rs.10 each at any time within a period of eighteen months from the date of issue.

400.000 equity warrants of Rs.10 each issued on September 13, 2010 lapsed during the year due to non-exercise of options by the holders of the equity warrants. The amount received on the above equity warrants Rs.180 lacs, has been forfeited by the Company and credited to Capital Reserve.

600.000 equity warrants of Rs.10 each issued on February 10, 2010 , were converted in to 6,00,000 equity shares of Rs.10 each fully paid at a premium of Rs.70 per share on exercise of the options on July 29, 2011.

3 SEGMENT REPORTING

The Company is primarily engaged in the business of investment and merchant banking activities. All the activities of the Company revolve around the main business. Further, the Company does not have any separate geographic segments other than India. There are no separate reportable segments as per Accounting Standard 17 on "Segment Reporting" issued by the Institute of Chartered Accountants of India.

4 Related party Transactions

Details of the related parties with whom transactions were carried out during the year along with a description of the relationship and the amounts involved are provided below.

a) Names of related parties and nature of relationship

i) Related parties where control exists (Subsidiary Companies)

Fortune Equity Brokers (India) Limited

Fortune Commodities & Derivatives (India) Limited

Fortune Credit Capital Limited

Fortune Financial India Insurance Brokers Limited

ii) Enterprises having significant influence

Mehra Capital Services Private Limited Jamish Investment Private Limited Umrigar Investment Private Limited Fortune Capital Services J.T. Poonja (HUF)

Nimish C. Shah (HUF)

iii) Key management personnel and their relatives

Mr. J.T. Poonja, Executive Chairman Mr. Nimish C. Shah, Managing Director Mrs. Sangeeta Poonja, Director Mr. Abhinay Poonja, Relative of a Director Ms. Aparna Poonja, Relative of a Director Mrs. Jalpa N. Shah, Relative of a Director Ms. Vidhi Shah, Relative of a Director

Mr. Chandulal Shah, Relative of a Director (up to 18-01-2012)

Mrs. Indumati Shah, Relative of a Director

The estimates of salary escalation considered in actuarial valuation takes into account inflation, seniority, promotion and other relevant factor such as demand and supply of employees

b) Defined Contribution Plans:

The amount recognized as expenses and included in "Contribution to gratuity, provident and other funds" in Note 18 is Rs.10.41 lacs (Previous year Rs.8.91 lacs).

c) General Description of significant defined benefit plan Gratuity Plan : Gratuity is payable to all eligible employees of the Company in terms of the provision of the Payment of Gratuity Act,1972

5 The Company has taken office premises under operating lease at various locations. These agreements provide an option to the Company to renew the lease period on mutually agreeable terms. The Company has given refundable interest free security deposits in accordance with the agreed terms.

The rental expense in respect of the operating leases, recognized in the Statement of Profit and Loss as "Rent" in Note "20" is Rs. 51.00 lacs (previous year Rs.51.30 lacs)

6 Contingent Liabilities and commitments (to the extent not provided for)

a) Fixed deposits of the Company pledged with a bank for overdraft facility of a subsidiary Rs.1,125.42 lacs (Previous year Nil)

b) Guarantee given by the banks on behalf of Fortune Group in respect of capital adequacy, daily margin and other contractual commitments for capital market operations of its Subsidiaries Rs.5,548.75 lacs (Previous year Rs.5,008.78 lacs)

c) Estimated amount of contracts remaining to be executed on capital account Nil (Previous year Nil)

7 Under Micro, Small and Medium Enterprises Development Act, 2006 which came into force from October 2, 2006, certain disclosures are required to be made relating to Micro, Small and Medium Enterprises. The Company has not yet commenced the process of compiling the relevant information from its suppliers about their coverage under the said Act and hence the relevant disclosures have not been made in the accounts. However, in the view of the Management, there is no possibility of any interest being payable to any supplier as the Company is prompt in making payments to its suppliers.

8 In the opinion of Management, the value of all Current Assets, Loans and Advances and other receivables is not less than their realisable value in the ordinary course of business.

9 Balances standing in debtors, creditors and loan and advances are subject to confirmation.

10 Previous year's figures are reworked, regrouped, rearranged and reclassified wherever necessary, to conform to the current year's classification.


Mar 31, 2011

1. Segment wise reporting

The Company is primarily engaged in the business of Investment and Merchant Banking activities. All the activities of the Company revolve around the main business. Further, the Company does not have any separate geographic segment other than India. As such there are no separate reportable segments as per Accounting Standard 17 on "Segment Reporting" (AS-17) issued by the Institute of Chartered Accountants of India.

2. Related Party Transaction

Details of the related parties with whom transactions were carried out during the year alongwith a description of the relationship and the amounts involved are provided below.

a) Name of the Related parties

i) Related Parties where control exists (Subsidiary Companies) Fortune Equity Brokers (India) Limited Fortune Commodities & Derivatives (India) Limited Fortune Credit Capital Limited Fortune Financial India Insurance Brokers Limited

ii) Other related parties

Enterprises having significant influence

Mehra Capital Services Private Limited

Umrigar Investment Pvt. Ltd

Fortune Capital Services J T Poonja (HUF)

Nimish C. Shah (HUF)

iii) Key management personnel and their relatives:

Mr. J.T. Poonja, Executive Chairman

Mr. Nimish C. Shah, Managing Director

Mrs. Sangeeta Poonja, Director

Mr. Abhinay Poonja, Relative of a Director

Ms. Aparna Poonja, Relative of a Director

Mrs. Jalpa N. Shah, Relative of a Director

Ms. Vidhi Shah, Relative of a Director

Mr. Chandulal Shah, Relative of a Director

Mrs. Indumati Shah, Relative of a Director

(vi) The estimates of salary escalation considered in actuarial revaluation takes into account inflation, seniority, promotion and other relevant factors such as demand and supply of employee.

(b) Defined Contribution Plans

The amount recognised as expense and included in Schedule 'N' under the head "Contribution to provident and other funds" of the Profit and Loss Account is Rs. 8.91 lacs (Previous year Rs. 3.06 lacs).

(c) General Description of significant defined benefit plan

Gratuity Plan: Gratuity is payable to all eligible employees of the Company in terms of the provisions of the Payment of Gratuity Act, 1972.

3. a. The Company has taken office premises under operating leases at various locations. These agreements provide an option to the Company to renew the lease period on mutually agreeable terms. The Company has given refundable interest free security deposits in accordance with the agreed terms.

b. The rental expense in respect of the operating leases, recognised in the Profit and Loss Account as "Rent" in Schedule "O" is Rs. 51.30 lacs (previous year Rs. 54.15 lacs)

4. The company has allotted 400,000 equity warrants of Rs.10 each at Rs. 180 per warrant (previous year 600,000 equity warrants of Rs. 10 each at Rs. 80 per warrant) convertible in one equity share of Rs. 10 each per warrant on a preferential basis to its promoters. In accordance with the terms of the issue, the holders of such warrants shall have an option to apply for one equity share of Rs.10 each at any time within a period of eighteen months from the date of issue. Accordingly, 600,000 & 400,000 warrants are due for conversion on or before August 4 2011 and March 12 2012 respectively. As on March 31 2011 none of the allottees have exercised their option for conversion.

5. Employees Stock Option Plan ("ESOP")

The Employee Stock Option Plan provides that the Company's employees and those of its subsidiaries are granted an option to acquire equity shares of the Company. The options may be exercised with in a specified period.

The Company follows the intrinsic value method to account for its stock based compensation plans. Compensation cost is measured as the excess, if any of the fair market value of the underlying share over the exercise price.

6. Contingent Liabilities

(Rupees in lacs)

Particulars March 31 2011 March 31 2010

Guarantee given by the banks on behalf of 5,008.75 3,708.75 Fortune Group in respect of capital adequacy, daily margin and other contractual commitments for capital market operations of its Subsidiaries

7. Estimated amount of contracts remaining to be executed on capital account Nil (Previous year Rs.23.98 lacs)

8. a. Section 115-O of the Income Tax Act, 1961 provides for calculation of dividend distribution tax liability of the holding company after permitting reduction of dividend received from its subsidiaries. In view of this, there is no tax on dividend distribution by the Company.

b. The amount of proposed equity dividend includes Rs.1.80 lacs on account of dividend for the year 2009-2010 on equity shares issued pursuant to Employee Stock Option Scheme of the company.

9. Under Micro, Small and Medium Enterprises Development Act, 2006 which came into force from October 2 2006, certain disclosures are required to be made relating to Micro, Small & Medium Enterprises. The Company has not yet commenced the process of compiling information from its suppliers about their coverage under the said Act and hence the relevant disclosures have not been made in the accounts. However, in the view of the Management, there is no possibility of any interest being payable to any supplier as the Company is prompt in making payments of its dues.

10. In the opinion of management, the value of all current assets, loans and advances and other receivables is not less than their realisable value in the ordinary course of business.

11. Balances standing in debtors, creditors and loans and advances are subject to confirmations.

12. Previous year's figures are reworked, regrouped, rearranged and reclassified wherever necessary, to conform to the current year's classification.








Mar 31, 2010

1. Segment wise reporting

The Company is primarily engaged in the business of Investment and Merchant Banking activities. All the activities of the Company revolve around the main business. Further, the Company does not have any separate geographic segments other than India. As such there are no separate reportable segments as per Accounting Standard 1 7 on "Segment Reporting" (AS-1 7) issued by the Institute of Chartered Accountants of India.

2. As per Accounting Standard 18 issued by The Institute of Chartered Accountants of India, the related parties with whom the Company has entered into transactions during the year in the ordinary course of business, as certified by the Management are disclosed below:

I) Disclosures in respect of Related Parties :

a) Related parties where control exists:

Subsidiary Companies

Fortune Equity Brokers (India) Limited

Fortune Commodities & Derivatives (India) Limited

Fortune Credit Capital Limited

Fortune Financial India Insurance Brokers Limited

b) Other related parties

i) Enterprises having significant influence :

Mehra Capital Services Private Limited

Umrigar Investment Pvt. Ltd

Fortune Capital Services

J T Poonja ( HUF)

NimishC.Shah(HUF)

ii) Key management personnel and their relatives:

Mr. J.T. Poonja, Executive Chairman

Mr. Nimish C. Shah, Managing Director Ms. Sangeeta Poonja, Director

Mr. Abhinay Poonja, Relative of a Director

Ms. Aparna Poonja, Relative of a Director

Mrs. Jalpa N. Shah, Relative of a Director

Ms. Vidhi Shah, Relative of a Director

Mr. Chandulal Shah, Relative of a Director

Mrs. Indumati Shah, Relative of a Director

3. a. The Company has taken office premises under operating lease at various locations. These agreements provide an option to the Company to renew the lease period on mutually agreeable terms. The Company has given refundable interest free security deposits in accordance with the agreed terms.

b. The rental expense in respect of the operating lease, recognised in the Profit and Loss Account as "Rent" in Schedule "P" is Rs.54.15 Lacs (previous year Rs.48.65 Lacs)

4. The Company has allotted 600,000 equity warrants of Rs.10 each at Rs. 80 per warrant (previous year 4,00,000 equity warrants at Rs. 220/- per warrant) on a preferential basis to its promoters during the year. In accordance with the terms of the issue, the holders of such warrants shall have an option to apply for one equity share of Rs.10 each at any time within a period of eighteen months from the date of allotment, (i.e. not later than August 4 2011). No options have been exercised till, March 31 2010.

5. 400,000 equity warrants of Rs.10 each issued on preferential basis to its promoters on July 5 2008, lapsed during the year due to non-exercise of options by the warrant holders. The amount received on the above equity warrants amounting to Rs. 88 Lacs, has been forfeited by the Company and credited to Capital Reserve.

6. Employees Stock Option Plan ("ESOP")

The Employee Stock Option Plan provides that the Companys employees and those of its subsidiaries are granted an option to acquire equity shares of the Company. The options may be exercised within a specified period.

The Company follows the intrinsic value method to account for its stock based compensation plans. Compensation cost is measured as the excess, if any of the fair market value of the underlying share over the exercise price.

7. Contingent Liabilities

(Rupees in Lacs)

Particulars 2009-2010 2008-2009

Corporate counter guarantee given by the Company 3,708.75 2,428.75

for the credit facilities availed by Subsidiary Companies

8. Disclosure as per clause 32 of the Listing Agreement

Loans and Advances in the nature of loans given to subsidiary companies:

9. Estimated amount of Contracts remaining to be executed on Capital Account Rs. 23.98 Lacs (Previous Year Rs. Nil)

10. Section 115-Oofthe Income Tax, 1961 Act provides for calculation of dividend distribution tax liability of the holding company after permitting reduction of dividend received from its subsidiaries. In view of this, there is no tax on dividend distribution by the Company.

11. Under Micro, Small and Medium Enterprises Development Act, 2006 which came into force from October 2, 2006, certain disclosures are required to be made relating to Micro, Small & Medium Enterprises. The Company has not yet commenced the process of compiling the relevant information from its suppliers about their coverage under the said Act and hence the relevant disclosures have not been made in the accounts. However, in the view of the Management, there is no possibility of any interest being payable to any supplier as the Company is prompt in making payments to its suppliers.

12. In the opinion of Management, the value of all Current Assets, Loans and Advances and other receivables is not less than their realisable value in the ordinary course of business.

13. Balances standing in debtors, creditors and loans and advances are subject to confirmation.

14. Previous years figures are reworked, regrouped, rearranged and reclassified wherever necessary, to conform to the current years classification.

Notes:

1. Cash flow statement has been prepared under the indirect method as set out in the Accounting Standard (AS) 3: "Cash Flow Statements" as specified in the Companies (Accounting Standards) Rules, 2006.

2. Previous years figures are reworked, regrouped, rearranged and reclassified wherever necessary, to conform to the current years classification.





 
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