Home  »  Company  »  Manappuram Finance  »  Quotes  »  Notes to Account
Enter the first few characters of Company and click 'Go'

Notes to Accounts of Manappuram Finance Ltd.

Mar 31, 2016

1) Nature of operations

Manappuram Finance Limited (''MAFIL'' or ''the Company'') was incorporated on July 15, 1992 in Thrissur, Kerala. The Company is a Non-Banking Finance Company (''NBFC''), which provides a wide range of fund based and fee based services including gold loans, money exchange facilities, etc. The Company currently operates through 3,293 branches spread across the country. The Company is a Systemically Important Non-Deposit taking NBFC.

NOTE: 2

2) Basis of preparation

The financial statements of the company have been prepared in accordance with the generally accepted accounting principles in India (Indian GAAP). The company has prepared these financial statements to comply in all material respects with the accounting standards notified under section 133 of the Companies Act 2013, read together with paragraph 7 of the Companies (Accounts) Rules 2014 and the guidelines issued by the Reserve Bank of India as applicable to a non-deposit accepting NBFC. The financial statements have been prepared under the historical cost convention and on an accrual basis except for interest and discounts on non- performing assets which are recognized on realization basis.

The accounting policies adopted in the preparation of financial statements are consistent with those of previous year, except for the change in accounting policy explained below.

Note: 3

Employment benefits disclosures:

The amounts of Provident fund contribution charged to the statement of Profit and loss during the year aggregates to Rs. 307.05 for March 31, 2016 (March 31, 2015 Rs. 223.13)

The Company has a defined benefit gratuity plan. Every employee who has completed five years or more of service gets a gratuity on departure at 15 days salary (last drawn salary) for each completed year of service. The scheme is funded with Life Insurance Corporation of India and Kotak Life Insurance.

The following tables summaries the components of net benefit expense recognized in the statement of profit and loss and the funded status and amounts recognized in the balance sheet for the gratuity plan.

Note 4:

Commitments

(i) Estimated amount of contracts remaining to be executed on capital account, net of advances is Rs. 20.08 as at March 31, 2016 (March 31, 2015 - Rs. 4.70).

(ii) The Company has entered into an agreement for outsourcing of Information Technology support in April 2011 for a period of 10 years with an annual expense of Rs. 270.

Note 5:

Contingent liabilities

(a) Applicability of Kerala Money Lenders'' Act

The Company has challenged in the Hon''ble Supreme Court the order of Hon''ble Kerala High Court upholding the applicability of Kerala Money Lenders Act to NBFCs. The Hon''ble Supreme Court has directed that a status quo on the matter shall be maintained and the matter is currently pending with the Hon''ble Supreme Court. The Company has taken legal opinion on the matter and based on such opinion the management is confident of a favourable outcome. Pending the resolution of the same, no adjustments have been made in the financial statements for the required license fee and Security deposits.

(b) Litigations

i) Matters of litigation, if any, the outcome of which in the opinion of Management is considered probable thereby requiring provision, have been provided for under the requirement of Indian GAAP.

ii) Income tax demand related to Financial year 2012-13 on account of disallowances of certain expenditure amounting to Rs. 7.72 including interest. The Company has preferred an appeal against the order with Commissioner of Income Tax (Appeals)

Note 6:

Lease Disclosures

Operating Lease :

Office premises are obtained on operating lease which are cancellable in nature. Operating lease payments are recognized as an expense in the statement of profit and loss.

Finance Leases:

The Company has finance leases for vehicles. These leases are non-cancellable and has no escalation clause. Future minimum lease payments (MLP) under finance leases together with the present value of the net MLP are as follows:

Note 7:

Cash collateral deposits

Deposit with Banks includes Cash collaterals deposits aggregating Rs. 1020.00 (March 31, 2015 Rs. 940.00) towards approved facilities. Bank /institution wise breakup of the same is as under :

Note 8:

Derivatives

There are no derivatives taken during the current and previous year.

Note 9:

Disclosures relating to Securitisation

The Company has no securitisation transaction during the current and previous year.

Note 10:

Details of Single Borrower Limit (SGL) / Group Borrower Limit (GBL) exceeded by the NBFC

The Company has not exceeded the Single borrower and group borrower limits

Note 11:

Draw down from Reserves

Details of draw down from reserves, if any, are provided in Note 4 to these financial statements.

Note 12:

Miscellaneous

i) Registration obtained from other financial sector regulators

The Company is not registered with any other financial sector regulators.

ii) Disclosure of Penalties imposed by RBI and other regulators

No penalties have been imposed by RBI and other Regulators during the year ended March 31, 2016 and March 31, 2015.

Note: 13:

Under Recovery of Interest Income

The Company disbursed some gold loans on which the total amount receivable including principal and accumulated interest have exceeded the value of the underlying security. As of March 31, 2016, the Company has not recognized interest income aggregating to Rs. 0.71 (March 31, 2015 Rs. 773.90).

Note: 14

During the year there have been certain instances of fraud on the Company by employees and others, where gold loan related misappropriations / cash embezzlements have occurred for amounts aggregating an amount of ''60.05 (March 31, 2015 Rs.69.23) of which the Company has recovered Rs.23.69 (March 31, 2015 Rs.8.87). The Company has taken insurance cover for such losses and has filed insurance claims in this regard. Further, the Company is in the process of recovering these amounts from the employees and taking legal actions, where applicable. The Company has created provision aggregating to Rs.36.36 (March 31, 2015 Rs.42.98) towards these losses based on its estimate.

Note: 15

Utilisation of proceeds of public issue.

During the current year, the Company has raised Nil (March 31, 2015 Rs.2,785.52) by way of public issue of Secured Non Convertible Debentures (public issue) to be utilised to meet its various financing activities including lending and investment and towards business operations including Capital expenditure and working capital requirements. As at March 31, 2015, the Company has utilised the entire proceeds of the public issue, net of issue expenses in accordance with the objects stated in the offer document.

Note: 16

Loans and advances in the nature of loans given to subsidiaries and associates and firms/ companies in which directors are interested

a) Manappuram Home Finance Private Limited Loan given to wholly owned subsidiary:

"Balance as at 31 March 2016 NIL (31 March 2015: NIL)

Maximum amount outstanding during the year Rs.405 million (31 March 2015: NIL)"

b) Asirvad Microfinance Private Limited Loan given to other subsidiary:

"Balance as at 31 March 2016 NIL (31 March 2015: NIL)

Maximum amount outstanding during the year Rs.500 million (31 March 2015: NIL)"

Note: 17

Expenditure on Corporate Social Responsibility (CSR)

For the year ended March 31, 2016 the Company has incurred expenditure of Rs.94.22(March 31, 2015 Rs.43.38) as compared to expenditure required to be spent under section 135 of the Act of Rs.71.10 (March 31, 2015 Rs.101.78) resulting in an excess of Rs.23.12(March 31, 2015 shortfall Rs.58.40). Refer to the Director''s report for details on the same.

Note: 18

Previous year figures

Previous year figures have been regrouped/reclassified, where necessary, to conform current year''s classification.


Mar 31, 2014

1) Nature of operations

Manappuram Finance Limited (''MAFIL'' or ''the Company'') was incorporated on July 15, 1992 in Thrissur, Kerala. The Company is a Non Banking Finance Company (''NBFC''), which provides a wide range of fund based and fee based services including gold loans, money exchange facilities, etc. The Company currently operates through 3,293 branches spread across the country. The Company is a Systemically Important Non-Deposit taking NBFC.

2) Basis of preparation

The financial statements of the Company have been prepared in accordance with generally accepted accounting principles in India (Indian GAAP). The Company has prepared these financial statements to comply in all material respects with the accounting standards notified under the Companies Act, 1956, read with General Circular 8/2014 dated 4 April, 2014 issued by the Ministry of Corporate Affairs and the guidelines issued by the Reserve Bank of India as applicable to a non deposit accepting NBFC. The financial statements have been prepared under the historical cost convention and on an accrual basis except for interest and discounts on non performing assets which are recognised on realisation basis. The accounting policies have been consistently applied by the Company and are consistent with those used in the previous year, except for certain changes in estimates discussed in note 2.1(c) and note 38.

NOTE: 3

Employee Stock Option Scheme (ESOS), 2009

Subsequent to the share split and bonus issue in an earlier year, the number of options has been adjusted to 8,295,000 options and the exercise price has been adjusted to Rs. 33.12/- per share in accordance with the terms of the scheme. Further, subsequent to bonus issue in the earlier year, the exercise price has been adjusted to Rs. 16.56 per share.

NOTE: 4

Employment benefits disclosures:

The amounts of Provident fund contribution charged to the statement of Profit and loss during the year aggregates to Rs. 160.80 for March 31, 2014 (March 31, 2013 Rs. 173.20)

The Company has a defined benefit gratuity plan. Every employee who has completed five years or more of service gets a gratuity on departure at 15 days salary (last drawn salary) for each completed year of service. The scheme is funded with Life Insurance Corporation of India and Kotak Life Insurance.

The following tables summaries the components of net benefit expense recognized in the statement of Profit and loss and the funded status and amounts recognized in the balance sheet for the gratuity plan.

The estimates of future salary increases, considered in actuarial valuation, take account of inflation, seniority, promotion and other relevant factors, such as supply and demand in the employment market.

NOTE 5:

Commitments

(i) Estimated amount of contracts remaining to be executed on capital account, net of advances is Rs. 4.32 as at March 31, 2014 (March 31, 2013 - Rs. 51.59).

(ii) The Company has entered into an agreement for outsourcing of Information Technology support in April 2011 for a period of 10 years with an annual expense of Rs. 270.

NOTE 6: Contingent liabilities

(a) Applicability of Kerala Money Lenders'' Act

The Company has challenged in the Hon''ble Supreme Court the order of Hon''ble Kerala High Court upholding the applicability of Kerala Money Lenders Act to NBFCs. The Hon''ble Supreme Court has directed that a status quo on the matter shall be maintained and the matter is currently pending with the Hon''ble Supreme Court. The Company has taken legal opinion on the matter and based on such opinion the management is confident of a favourable outcome. Pending the resolution of the same, no adjustments have been made in the financial statements for the required license fee and Security deposits.

(b) Show cause notice from Reserve Bank of India

The Company has received a show cause notice from the Reserve Bank of India on May 7, 2012 with certain observations made pursuant to their inspection of books and records of the Company. The Company has submitted a detailed reply on May 21, 2012 to the Reserve Bank of India

b) Exposure to real estate sector

The Company does not have any significant direct exposure towards real estate sector.

NOTE 7:

Lease Disclosures

Operating Lease :

Office premises are obtained on operating lease which are cancellable in nature. Operating lease payments are recognized as an expense in the statement of Profit and loss.

NOTE: 8

Under Recovery of Interest Income

The Company disbursed some gold loans on which the total amount receivable including principal and accumulated interest have exceeded the value of the underlying security. As of March 31, 2014, the Company has not recognized interest income aggregating to Rs. 881.71 (March 31, 2013 Rs. 2,842.50) and has made a provision for doubtful debts to the extent of Rs. Nil (March 31, 2013 Rs. 514.35) relating to the said gold loans as a prudent measure.

NOTE: 9

During the year there have been certain instances of fraud on the Company by employees and others, where gold loan related misappropriations / cash embezzlements have occurred for amounts aggregating an amount of Rs.127.66 (March 31, 2013 Rs. 56.34) of which the Company has recovered Rs. 64.78 (March 31, 2013 Rs. 41.73). The Company has taken insurance cover for such losses and has fled insurance claims in this regard. Further, the Company is in the process of recovering these amounts from the employees and taking legal actions, where applicable. The Company has created provision aggregating Rs. 52.97 (March 31, 2013 Rs. 14.61) towards these losses based on its estimate.

NOTE 10

During the year ended March 31, 2014, the Company has decided to consider average market price of gold that existed during the 90 days period ending on the reporting date instead of average market price of gold that prevailed subsequent to the balance sheet date till the date of approval of the financial statements and also decided to include loans which have completed six months tenure as against loans which have completed twelve months tenure for the estimation of expected recoverability of interest income. Had the Company followed the previous practice, the Profit before tax for the year ended March 31, 2014 would have been higher by Rs. 39.43.

NOTE: 11

Utilisation of proceeds of public issue.

During the current year, the Company has raised Rs. 4,000 (including Rs. 2,000 representing application money towards redeemable non- convertible debenture pending allotment) by way of public issue of Secured Non Convertible Debentures (public issue) to be utilised to meet its various financing activities including lending and investment and towards business operations including Capital expenditure and working capital requirements. As at March 31, 2014, the Company has utilised the entire proceeds of the public issue, net of issue expenses in accordance with the objects stated in the offer document.

NOTE: 12

Previous year figures

Previous year figures have been regrouped/reclassified , where necessary, to conform current year''s classification.


Mar 31, 2013

NOTE: 1

Nature of operations

Manappuram Finance Limited (formerly Manappuram General Finance 8 Leasing Limited) (''MAFIL'' or ''the Company'') was incorporated on July 15, 1992 in Thrissur, Kerala. The Company is a non banking financial Company (''NBFC''), which provides a wide range of fund based and fee based services including gold loans, money exchange facilities, etc. The Company currently operates through 3,295 branches spread across the country. The Company is a Systemically Important Non-Deposit Taking NBFC.

NOTE: 2

Basis of preparation

The financial statements of the Company have been prepared in accordance with generally accepted accounting principles in India (Indian GAAP). The Company has prepared these financial statements to comply in all material respects with the accounting standards notified under the Companies (Accounting Standards) Rules, 2006, (as amended) and the relevant provisions of the Companies Act, 1956 and the guidelines issued by the Reserve Bank of India as applicable to a non deposit accepting NBFC. The financial statements have been prepared under the historical cost convention and on an accrual basis except for interest and discounts on non performing assets which are recognised on realisation basis. The accounting policies have been consistently applied by the Company and are consistent with those used in the previous year, except for certain change in estimates discussed in note 2(c).

NOTE: 3

Employment benefits disclosures:

The amounts of Provident fund contribution charged to the Profit and loss account during the year aggregates to Rs. 173.20 (Previous year - Rs. 173.97 ).

The Company has a defined benefit gratuity plan. Every employee who has completed five years or more of service gets a gratuity on departure at 15 days salary (last drawn salary) for each completed year of service. The scheme is funded with Life Insurance Corporation of India and Kotak Life Insurance.

The following tables summaries the components of net benefit expense recognised in the profit and loss account and the funded status and amounts recognised in the balance sheet for the gratuity plan.

NOTE: 4

Commitments

(i) Estimated amount of contracts remaining to be executed on capital account, net of advances is Rs. 51.59 (Previous year - Rs. 127.90).

(ii) The Company has entered into an agreement for outsourcing of Information Technology support in April 2011 for a period of 10 years with an annual expense of Rs. 270.

NOTE: 5

March 31, 2013 March 31, 2012

Contingent liabilities

(a) The Company is contingently liable to banks and other financial institutions 1.94 2,600.72 with respect to assignment of gold loans to the extent of the collateral deposits/ guarantees. Management does not expect the contingency to dwell on the Company.

TOTAL 1.94 2,600.72

(b) Applicability of Kerala Money Lenders'' Act

The Company has challenged in the Hon''ble Supreme Court the order of Hon''ble Kerala High Court upholding the applicability of Kerala Money Lenders Act to NBFCs. The Hon''ble Supreme Court has directed that a status quo on the matter shall be maintained and the matter is currently pending with the Hon''ble Supreme Court. The Company has taken legal opinion on the matter and based on such opinion the management is confident of a favourable outcome. Pending the resolution of the same, no adjustments have been made in the financial statements for the required license fee and Security deposits.

(c) Show cause notice from Reserve Bank of India

The Company has received a show cause notice from the Reserve Bank of India on May 7, 2012 with certain observations made pursuant to their inspection of books and records of the Company. The Company has submitted a detailed reply on May 21, 2012 to the Reserve Bank of India and no further communication has been received from the Reserve Bank of India in this matter.

(d) Provision for litigation claim

During the year the Company has made provision for the litigation claim related to the civil and consumer cases amounting to Rs. 12.19 on prudence basis.

NOTE: 6

Lease Disclosures

Operating Lease:

Office premises are obtained on operating lease which are cancellable in nature. Operating lease payments are recognised as an expense in the statement of profit and loss.

Finance Leases:

The Company has finance leases for vehicles. Future minimum lease payments (MLP) under finance leases together with the present value of the net MLP are as follows:

NOTE: 7

Assignment of Receivables

The Company has assigned a portion of its gold loans to banks and financial institution. The aggregate amount of assignment as at March 31, 2013 is Rs. Nil (Previous year 19,163.62). These amounts have been reduced from the gross loan and hypothecation loan balances. Bank/ Institution wise breakup of the same is as under.

NOTE: 8

Transactions with related parties

a) Remuneration to relatives of director

The Company had in the previous year filed an application to Central Government for waiver of remuneration paid in earlier years to relatives of director, holding office or place of profit in the Company amounting to Rs. 4.87. During the year, the Company has received a favourable order from the Central Government waiving the recovery of remuneration paid to them in the earlier years except to the extent of Rs. 0.43 and the Company has recovered the same.

b) Transactions under Section 297 of the Companies Act, 1956

During the year the Company has filed application to Central Government/Company Law Board for Compounding certain non compliance relating to earlier years under provision of section 297 of the Companies Act, 1956 in connection with rendering/receiving certain services to/from parties covered under Section 301 of the Companies Act, 1956. The Company has received the compounding orders from the respective authorities and paid the compounding fees.

NOTE: 9

Loan To Value (''LTV'') calculation:

The Reserve Bank of India vide its Notification No DNBS(PD).

241/CGM(US)-2012 dated March 21, 2012, requires NBFCs to maintain a Loan to Value (LTV) ratio not exceeding 60% for loans granted against the collateral of gold Jewellery.

The Company has adopted the rates prescribed by the Association of Gold Loan Companies (AGLOC) that factors the making charges involved in the manufacture of ornaments. Management of the Company has also discussed the methology with the Reserve Bank of India and also communicated the manner of arriving at the LTV to the Reserve Bank of India

NOTE: 10

Under recovery of interest income

During the FY 2011-12 the Company disbursed some gold loans on which the total amount receivable including principal and accumulated interest have exceeded the value of the underlying security. As at March 31, 2013, the Company has not recognised interest income aggregating to Rs. 2,842.5 and has made a provision for doubtful debts to the extent of Rs. 514.35 relating to the said gold loans as a prudent measure.

NOTE: 11

During the year there have been certain instances of fraud on the Company by employees and others where gold loan related misappropriations/cash embezzlements have occurred for amounts aggregating an amount of Rs. 56.34 (net of recoveries of Rs.14.61). The Company has fully provided for these amounts in the financial statements and is in the process of recovering these amounts from the employees and taking legal actions.

NOTE: 12

Previous year figures

Previous year figures have been regrouped/reclassified, where necessary, to confirm to this year''s classification.


Mar 31, 2012

Nature of operations

Manappuram Finance Limited (formerly Manappuram Genera Finance & Leasing Limited) ('MAFIL' or 'the Company') was ncorporated on July 15, 1992 in Thrissur, Kerala. The Company is a non banking financial Company ('NBFC'), which provides a wide range of fund based and fee based services including gold loans, money exchange facilities, etc. The Company currently operates through 2,907 branches spread across the country. The Company is a Systemically Important Non-Deposit Taking NBFC.

NOTE :1

Basis of preparation

The financial statements of the Company have been prepared in accordance with generally accepted accounting principles in India (Indian GAAP). The Company has prepared these financia statements to comply in all material respects with the accounting standards notified under the Companies (Accounting Standards) Rules, 2006, (as amended) and the relevant provisions of the Companies Act, 1956 and the guidelines issued by the Reserve Bank of India as applicable to a non deposit accepting NBFC. The financia statements have been prepared under the historical cost convention and on an accrual basis except for interest and discounts on non performing assets which are recognised on realisation basis. The accounting policies have been consistently applied by the Company and are consistent with those used in the previous year, except for certain change in estimates discussed in note 2(d).

a. Terms/rights attached to equity shares

The Company has only one class of equity shares having a par value of Rs. 2/- per share. Each holder of equity shares is entitled to one vote per share. The Company declares and pays dividends in Indian rupees. The dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting.

During the year ended 31 March 2012, the amount of per share dividend recognised as distributions to equity shareholders was Rs. 1.50/- (31 March 2011: Rs. 0.60/- per share, after considering bonus issue).

In the event of liquidation of the Company, the holders 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.

Nature of Security

Secured by mortgage of the immovable property of the Company and a charge on all current asset, book debts, receivables as fully described in the debenture trust deed except those receivables specifically exclusively charged, on a first ranking pari passu basis with all other lenders to the Company holding pari passu charge over security.

The Company shall maintain an asset cover of at least 1.10 times of the outstanding amount of debenture, at all times, till the debentures are completely redeemed.

(b) Applicability of Kerala Money Lenders' Act

The Company has challenged in the Hon'ble Supreme Court the order of Hon'ble Kerala High Court upholding the applicability of Kerala Money Lenders Act to NBFCs. The Hon'ble Supreme Court has directed that a status quo on the matter shall be maintained and the matter is currently pending with the Hon'ble Supreme Court. The Company has taken legal opinion on the matter and based on such opinion the management is confident of a favourable outcome. Pending the resolution of the same, no adjustments have been made in the financial statements for the required license fee and Security deposits.

(c) Show cause notice from Reserve Bank of india

The Company has received a show cause notice from the Reserve bank of India on May 7, 2012 with certain observations made pursu- ant to their inspection of books and records of the Company. The Company is in process of responding to the show cause notice. Based on the internal and external legal opinion, the Company believes that it can address all observations to the satisfaction of the Reserve Bank of India. Pending resolution of the matter by the Reserve Bank of India, no adjustments, if any that may be required, have been made in these financial statements.

NOtE: 2

transactions with related parties

a) Remuneration to relatives of director

The Company had in an earlier year made an application to Central Government for approval of remuneration paid to relatives of director holding office or place of profit in the Company. During the current year, the application has been rejected by the Central Government. Subsequently, the Company has made an application to the Central Government to waive the amounts paid to the relatives in the earlier years. Pending the receipt of the approval the entire amount paid ofRs. 4.87 is shown as receivable from them.

b) transactions under Section 297 of the Companies Act, 1956

The Company had shared common infrastructure facilities and performed / received collection services from other companies covered under Section 301 of the Companies Act, 1956. The Company is in the process of obtaining necessary approvals / condonations from the Central Government, if any that may be required in respect of the various classes of transactions entered into with parties covered under Section 297 of the Companies Act, 1956, including certain free of cost transactions. The Company has also made provision for the probable compounding fees payable.

Note : 3

Utilisation of proceeds of public issue

During the current year, the Company has raised Rs. 4,416.19 by way of public issue of Secured Non Convertible debentures (public issue) to be utilised to meet its various financing activities including lending and investments and towards business operations including for capital expenditure and working capital requirements. As at March 31, 2012, the Company has utilised the entire proceeds of the public issue, net of issue expenses in accordance with the objects stated in the offer document.

Note : 4

During the year there have been certain instances of fraud on the Company by employees where gold loan related misappropriations / cash embezzlements have occurred for amounts aggregating Rs. 38.32 million. The Company has fully provided for these amounts in the financial statements and is in the process of recovering these amounts from the employees and taking appropriate legal actions.

Note : 5 Comparatives

Till the year ended 31 March 2011, the Company was using pre-revised Schedule VI to the Companies Act 1956, for preparation and presentation of its financial statements. During the year ended 31 March 2012, the revised Schedule VI notified under the Companies Act 1956, has become applicable to the Company. The Company has reclassified previous year figures to conform to this year's classification.


Mar 31, 2010

1. Nature of operations

Manappuram General France are Leasing Limited {"MAGFill or the Company) was incorporated on July 15,1992 in Thrissur, Kerala. The Company is a non banting francial company {"NBFC}, which provides a wide range of fund based and fee based services induding gold loans, hypothecation loans, money exchange facilities etc, Tne Company currently operates through more than 1.000 brancheis spred across the country

1.2 Amalgamation of Manappuram Finance (Tamil Nadu) Limited (MAFIT) with the Company

MA-IT is a non banking financial company (NBFC), which provides a wide range of fund based services mcluding gold loans, etc

The Company had entered in to a Scheme of Amalgamate (Scheme) with MAFIT or the amalgamation of MAFIT with the Company effective April 1 2008 ("Appointed Date)- The scheme was approved by the Honble High Court of Judicature at Madras on December 8,2009, and Hontte High Court of Judicature at Kerala on December 23,2009. Pursuant to an order of the Honble Hlgn Court and consequent filing tnere of with the Registrar of Companies, Colmbatore on December 23,2009 and Reglstrar of Comanies, Keralla on January 7,2010, MAFIT without being wound up The scheme has accordingly been given effect to in those financeial statements with retrospective effect from April 1, 2008

In consideration of transfer of the urrdertaking of MAFIT the Company has .on January 11, 2010 issued 11,677382 equity shares of Rs, 10/- each, credited as fully paid up* in the ratio of 2:1 equity share of the face value of Rs.10/-each in Company for every equity share of the face value of Rs. 10/- (Rupees Ten only) each held in MAFIT.

The amalgamation has been accounted for under "pooling of interests" method as prescribed by Accouning Stardard 14 "Accounting for Amalgamations" issued by the Institute of Chartered Accountants of India.

All tht assets and Liabilitles of MAFIT as of April 1,2008, were transfer red to and vested in the Company at the carrying values as appearing in the books of accounts. the summary of which is as below:

1.3 Acquisition of Manappuram Printers

Manappuram Printers, a sole proprietorship owned by the promoters of the Company was engaged in the business of trading stationery items Pursuant 10 a board resolution dated February 25,2009, the Company has acquired at the assets and liabilities of Manappuram Printers with effect from April 1,2009 on a slump sale basis based on an external valuation. The Company has obtained the necessary approvals in ths regard. The purchases of the assets and liabilities have been made at cost for Rs 10.17

1.4 Share Capital

Conversion of wairants

During the current year, the Promoters of the Company have in termsof the Warrant Subscription Agreement dated November 4. 2006 exercsed their option to convert 1,564,892 conditionally convertible warrants into 1,564392 equlity shares at a price of Rs 166,62/- In accordance with the agreement and relevant SEBI (Securities and Exchange Board of India regulations, the promoters have paid a sun of Rs 2307 towards the balance amount due payable at the time of all otment of equity shares upon conversion of the warrants.

Issued of equity shares through shdies through private pldccrrent to Qualified Institutional Buyers (*QIBs")

During the current year, me Company has issued 3,540,420 shares to certain QBs Dy way of a private placemen; at a price of Rs 69V- per share at a premum of Rs 681/* per share. The issues of these shares are for the purposes of augmenting the furring needs of the Company and to meetcapital adequacy norms. The Company raised at total amount of Rs. 2,446 43 from thrsr QIBs and incurred an amount of Rs 76 as shore issues expenses which has been set off against tine share premium account

Bonus and share spit approved subsequent to Balance Sheet

The shareholders of the Company have on April 22,2010 through a resolution approved the sub division of one fully paid equity share of Rs 10/- each of the Company into five equity shares of Rs 2/ each fully pad pursuant to Section 94 of the Act. farther, the shareholders of the Company nave through a resolution passed on April 22.2010 approved the issuance of equity shares of Rs2/-each fully paid up, as up as bonus shares(after considering the stock spilt as abowe) in the ration of the shareholders i*i*. existing as on the record dale- These changes will be given effect lo in the folowing year except for the changes in the Earrings Per Share discusseo below

As per the requrerrents of paragraph 44 read with paragraphs of Accounting Standard 20 Earnings per Share AS-20,the number of equity shares outstanding as at March 31,2010 has been adjusted for the amount of such bonus shares and sub- divided shares in the computation of the weighted average number of shares for the computation of EPS for all periods presented.

Employee Stock Option Scheme (ESOSI, 2009

The shareholders al the Annual General Meeting he a on August 17, 2009, have approved an Employee Stock Option Scheme 2009 (ESOS 2009) which provides for an issue of 1,000.000 options lo the employees. Consequently, the compensation cornmittee had granted the 829,500 options on August Vt 2009 at an exercise price of Rs 331.15/ per share.

1.5 Segment resorting

Primary Segment: Busiess Segment

The three identified reportable segments are:

1. Gold and other loans * Financing loans against pledging of gold and gold ornaments

2. Asset financing - Financing of loans aganstst hypothecation of vehicles3. Fee based activites Money transfer, foreign currency exchange

1.6 Employment benefits disclosure*:

The amounts of Provident fund contribution charged to the Profit and loss account during the year aggrcgatrs to Rs. 26.25 (Previous year * Rs. 9.95)-

The Company has a defined benefit gratuity plan Every employee who has completed five years or more of service gets a gratuity on departure at 15 days salary (last drawn salary) for each completed year of service. The scheme is funded with an Insurance company in the form of a qualifying insurance polling.

The following tables summarise the components of net benefit expense recognised in the profit and loss account and the funded status aro amounts recognised in the balance sheet for the gratuity plan.

1 .7 Commitments and contingent liabilities

Commitments

Estimated amount of contracts remaining to be exeuted on capital accounl,net of advances is Rs. 153(Prevlous Year - Rs. Nil) .

Contingent Liabilites 2010 2009

(I) Claims against the Company not acknowledged as debts

Penalty urder Kerala General Sates Tax Act and Kerala Money lenders Act - 0.72

pi) Others

The Company is contingently lable to banks and other financial

institutions with respect to assignment of gold / hypothecation loans

to the extent of the colateral cepost / guarantees 70717 1,25838

Total [ (i) + {iii)] 707,17 1,239,10



(iii) Applicability of Kerala Morey Lenders Act

The Company has challenged in the Honble Supreme Court the order of Honble Kerala High Court upholding the applicability of Kerala Money Lenders Act to NBFCs. The Honble Supreme Court has directed that a status quoon the matter shall be maintained and the matter is currently pening with opinion the management witnihe Supwrccourt The Cort. The Company has taken legal opinion on the matter and based on such opinion the management is confident of a favourable outcome Pending the resolution of the same, no adjustments have been made in the financial statements for the required license fee and Security deposits

1.8 Assignment of receivables

The Campany has assigned a portion of its go d loans / hypothecations loans to banks and financial Institutions during the year. The aggregate amount assigned as as at March 31,2010 is Rs, 7,077,02 (Previous year-Rs 5.381421

These amounts have been reduced from the gross gold loan and hypothecation loan balances.

1.9 Charges created on assets of the Company for Secured Loans

A Secured Non Convert We Debentures

Non convertible secured debentures are secured by floating cnarge on the specifled hire purchase receivables. Gold loan Including recelvables there on and olher unentumbered asselsboth prescnt and future.

B. From banks

Overdraft/ Working Capital Loan accounts have been availed With the following banks are sesured by Gold Loan receivables.



State Dank of India Syndicate Bank Limited

Corporation Bank Limited The Karur Vysya Bank Limited

South Indian Bank Limited Bank of Rajasihan Limited

Punjab National Bank Limited Axis Bank Limited

VFS Bar* Limited IDBI Bank Limited

Central Bank of India Limited Catholic Syrian Bank

IOFC Bank Limited ING Vysya Bark

Induslnd Bank Limited Lakshmi villas Bank

Dhhanalakshmi Bank Limited Kotak Mahindra Bank

Oriental Bank of Commerce United ICICI Bank United

union Bank of India Limited Allahabad Bank Limited

Indian Overseas Bank Limited Kotak Mahindra Limited

1.10 During the yeat there have been instances of fraudon the Company by employees /third parties where gold loan and cash related misappropriations have occurred for amounts aggregating Rs 8.47 The Company has taken necessary action including claim from insurance companles. Further, appropriate actions have been taken against such employees/third parties,

1.11 Comparatives

As stated in Notes 3 and 4 of Schedue 18 in view of the amation of MAFIT with the Company with effect from April 1, 2008 and acquisition of Manappram Printers, the figures for the year ended March 31- 2010 are not comparable with those of the year ended March 31,2009. Further, previous years figures have been reclassified to form to the presentation of the current year.











 
Subscribe now to get personal finance updates in your inbox!