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Notes to Accounts of SKP Securities Ltd.

Mar 31, 2015

1) Terms / rights attached to equity shares:

Each holder of equity shares is entitled to one vote per share. The dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting. 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.

2) Details of shares reserved for issuance:

The company has reserved for issue of 56,000 (Previous year 70,000) equity shares of par value Rs. 10/- each at a premium of Rs. 19/- each for offering to eligible employees of the company under Employee Stock Option Scheme 2010. These shares reserved for issue are not yet excercised.

The Board of Directors have recommended a dividend of Rs. 1/= per share. This is subject to the approval of the shareholders in the ensuing Annual General Meeting.

3) Nature of Security

i) The vehicle loans are secured by way of hypothecation of vehicle purchased. The loan carries interest within the range of 9.5% -10.5% p.a.

ii) As the amount outstanding on 31st March,2015 was payable entirely within one year, the same has been included in the line item "Current maturities of long term debt" under the head "Other current liabilities" as at 31st March, 2015.

As at As at 4 Contingent liabilities : 31st March, 2015 31st March, 2014

Claims against the Company not acknowledged as debts :

Service tax demand - under appeal (Rs.) 56,90,264 56,90,264

Others- Under appeal/ litigation (Rs.) 4,16,504 -

The above amount represents the best possible estimates arrived at on the basis of available information. The uncertainties and timing of the cash flows are dependent on the outcome of the different legal processes which have been invoked by the Company or the claimants as the case may be and therefore cannot be estimated accurately. The Company does not expect any reimbursements in respect of the above contingent liabilities In the opinion of the management, no provision is considered necessary for the disputes mentioned above on the grounds that there are fair chances of successful outcome of appeals.

5 The company does not have any dues to Micro and Small Enterprises as per the requirement of Section 22 of the Micro, Small and Medium Enterprises Development Act, 2006 (Previous year - Rs. NIL )

6 The Employee Stock Option Scheme (SKP ESOP Plan 2010) of the Company was formulated in the year 2010. Under the said Scheme, Options granted have vesting period of one to three years and exercise period of maximum five years. The details of Options granted, lapsed and exercised as on 31st March, 2014 are as under :

Year Ended Year Ended Particulars 31st March 2015 31st March 2014

Year of Issue 2010-11 2010-11

Date of grant of Option 21.05.2011 21.05.2011

Exercise Price (Rs.) 29.00 29.00

Market Price on the date of grant (Rs.) 27.10 27.10

Excess of Market Price over Exercise Price (Rs.) (1.90) (1.90)

Number of Options granted upto 31.03.2014 1,00,000 1,00,000

Number of Options exercised upto 31.03.2014 - -

Number of Options lapsed upto 31.03.2014 44,000 30,000

Number of Options outstanding at beginning of the year 56,000 70,000

Number of Options exercised during the year - -

Number of Options lapsed during the year - 14,000

Number of Options outstanding at end of the year 56,000 56,000

Note : Refer Director's Report for other disclosures.

7 Employee Benefits :

As per Accounting Standard - 15 " Employee Benefits", the disclosure of Employee Benefits as defined in the Accounting Standard are as follows:

Defined Benefit Plan:

Long-term employee benefits in the forms of gratuity are considered as defined benefit obligation. The present value of obligation is determined based on actuarial valuation using projected unit credit method as at the Balance Sheet date. The amount of defined benefits recognised in the Balance Sheet represent the present value of the obligation as adjusted for unrecognised past service cost and as reduced by the fair value of plan assets. Any asset resulting from this calculation is limited to the discounted value of any economic benefit available in the form of refunds from the plan or reduction in future contribution to the plan. The amount recognised in the Accounts in respect of Employees Benefit Schemes based on actuarial reports are as follows :

Basis used to determine the expected Rate of return on Plan Assets:

The basis used to determine overall expected Rate of return on Plan Assets is based on the current portfolio of assets, investment strategy and market scenario. In order to protect the Capital and optimise returns within acceptable risk parameters, the Plan Assets are well diversified.

b) other disclosures:

i) Basis of estimates of Rate of escalation in salary :

The estimates of rate of escalation in salary, considered in actuarial valuation, take into account inflation, seniority, promotion and other relevant factors including supply and demand in the employment market. The above information is certified by the actuary.

ii) The Gratuity have been recognised under " Contribution to Provident Fund and Other Funds" under Note no. 18.

8 Segment information as per Accounting Standard - 17 on 'Segment Reporting':

The Company is primarily engaged in a single business segment of Broking & Dealing in Securities and related services. All the activities of the company revolves around the main business. As such there are no separate reportable segments as per Accounting Standard - 17 "Segment Reporting".

9 Related party disclosures as per Accounting Standard - 18 are given below: a) Name of the related parties and description of relationship:

i) Subsidiaries : SKP Commodities Ltd. (Common control) SKP Insurance Brokers & Advisors Pvt Ltd (w.e.f 4th August 2014)

ii) Key Managerial Personnel (KMP) : Mr. Naresh Pachisia, Managing Director Mr. Nikunj Pachisia, Director (w.e.f. 1st August, 2014) Mrs. Manju Pachisia, Non-Executive Director (w.e.f. 1st August, 2014) Mr. Rajesh Pachisia, Managing Director (upto 1st August,.2014)

iii) Relatives of Key Managerial Personnel :

Mr. Naresh Pachisia Mrs. Manju Pachisia (Wife) Mr. Nikunj Pachisia (Son) Mrs. Kanupriya Pachisia (Son's Wife)

Mr. Nikunj Pachisia Mrs. Kanupriya Pachisia

iv) Concerns over which KMP and their : Naresh Pachisia & Sons (HUF) relatives have substantial SKP Insurance Brokers & Advisors Pvt Ltd interest (upto 3rd August, 2014) Rajesh Pachisia & Sons (HUF)

c) The transactions with related parties have been entered at an amount which are not materially different from those on normal commercial terms.

d) No amount has been written back / written off during the year in respect of due to/from related parties.

e) The amount due from related parties are good and hence no provision for doubtful debts in respect of dues from such related parties is required. ( Refer Note 22.8)

f) Figures in brackets pertain to previous year.

10 Disclosure under clause 32 of the Listing Agreement:

There are no transactions with Subsidiary Company which are required to be disclosed under Clause 32 of the Listing Agreement with the BSE Limited.

11 Trade receivables include Rs. 44,32,842/- (Previous year Rs. 44,56,510/-) receivable from its subsidiary with respect to trade entered into on its behalf in National Spot Exchange Ltd (NSEL). NSEL has not been able to adhere to its payment obligation, however, since the payments are being received in instalments, no provision has been made.

12 Depreciation for the current year has been aligned to meet the requirements of Schedule -II to the Companies Act, 2013. Had the Company continued to charge depreciation based on rates and manner as specified under the erstwhile Schedule XIV to the Companies Act, 1956, depreciation expense would have been lower by Rs.17,67,382/-.and the Profit before Tax for the year ended 31st March, 2015 and the net value of fixed assets as at that date would have been higher by the like amount.

13 Details of Loan given and Investments made covered under section 186 (4) of the Companies Act, 2013:

The particulars of Investments made are given under "Non - current investments" in Note No. 8

14 Revised remuneration of Rs. 32,25,000/- payable to Mr. Rajesh Pachisia, Managing director (who resigned w.e.f 1st August, 2014) is subject to approval of the members in the ensuing Annual General Meeting.

15 The previous year's figures have been reworked, regrouped, rearranged and reclassified wherever necessary. Amounts and other disclosures for the preceding year are included as an integral part of the current year financial statements and are to be read in relation to the amounts and other disclosures relating to the current year.


Mar 31, 2014

A) Terms / rights attached to equity shares:

Each holder of equity shares is entitled to one vote per share. The dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting. 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.

b) Nature of Security

The vehicle loans are secured by way of hypothecation of the vehicle purchased. The loan carries interest within the range of 9.5% -10.5% p.a.

Year Ended Year Ended 2.1 Contingent liabilities : 31st March 2014 31st March 2013

Claims against the Company not acknowledged as debts :

Service tax demand - under appeal 56,90,264 56,90,264

The above amount represents the best possible estimates arrived at on the basis of available information. The uncertainties and timing of the cash flows are dependent on the outcome of the different legal processes which have been invoked by the Company or the claimants as the case may be and therefore cannot be estimated accurately. The Company does not expect any reimbursements in respect of the above contingent liabilities.

In the opinion of the management, no provision is considered necessary for the disputes mentioned above on the grounds that there are fair chances of successful outcome of appeals.

2.2 The company does not have any dues to Micro and Small Enterprises as per the requirement of Section 22 of the Micro, Small and Medium Enterprises Development Act, 2006 (Previous year - Rs.NIL )

2.3 The Employee Stock Option Scheme (SKP ESOP Plan 2010) of the Company was formulated in the year 2010. Under the said Scheme, Options granted have vesting period of one to three years and exercise period of maximum five years. The details of Options granted, lapsed and exercised as on 31st March, 2014 are as under :

2.4 Employee Benefits:

As per Accounting Standard -15 " Employee Benefits", the disclosure of Employee Benefits as defined in the Accounting Standard are as follows:

Defined Contribution Plan:

Employee benefits in the form of Provident Fund and Employee State Insurance Scheme are considered as defined contribution plan.

The contributions to the respective fund are made in accordance with the relevant statute and are recognised as expense when employees have rendered service entitling them to the contribution. The contributions to defined contribution plan, recognised as expense in the Statement of Profit and Loss are as under:

Defined Benefit Plan:

Long-term employee benefits in the forms of gratuity are considered as defined benefit obligation. The present value of obligation is determined based on actuarial valuation using projected unit credit method as at the Balance Sheet date. The amount of defined benefits recognised in the Balance Sheet represent the present value of the obligation as adjusted for unrecognised past service cost and as reduced by the fair value of plan assets.

Any asset resulting from this calculation is limited to the discounted value of any economic benefit available in the form of refunds from the plan or reduction in future contribution to the plan. The amount recognised in the Accounts in respect of Employees Benefit Schemes based on actuarial reports are as follows:

VIII. Basis used to determine the expected Rate of return on Plan Assets :

The basis used to determine overall expected Rate of return on Plan Assets is based on the current portfolio of assets, investment strategy and market scenario. In order to protect the Capital and optimise returns within acceptable risk parameters, the Plan Assets are well diversified.

b) Other disclosures:

i) Basis of estimates of Rate of escalation in salary:

The estimates of rate of escalation in salary, considered in actuarial valuation, take into account inflation, seniority, promotion and other relevant factors including supply and demand in the employment market. The above information is certified by the actuary.

ii) The Gratuity and Provident Fund Expenses have been recognised under " Contribution to Provident Fund and Other Funds" under Note no. 19.

2.5 Segment information as per Accounting Standard - 17 on ''Segment Reporting'':

The Company is primarily engaged in a single buisness segment of Broking & Dealing in Securities and related services. All the activities of the company revolves around the main business. As such there are no separate reportable segments as per Accounting Standard - 17 "Segment Reporting" notified by the Central Government under the Companies (Accounting Standard) Rules 2006.

c) The transactions with related parties have been entered at an amount which are not materially different from those on normal commercial terms.

d) No amount has been written back / written off during the year in respect of due to / from related parties.

e) The amount due from related parties is good and hence no provision for doubtful debts in respect of dues from such related parties is required (Refer note 23.8).

f) Figures in brackets pertain to previous year.

2.6 Disclosure under clause 32 of the Listing Agreement:

There are no transactions with Subsidiary Company which are required to be disclosed under Clause 32 of the Listing Agreement with the Bombay Stock Exchange Limited.

2.7 Trade receivables include Rs. 44,56,510/- (Previous year Nil) receivable from its subsidiary with respect to trade entered into on its behalf in National Spot Exchange Ltd (NSEL). NSEL has not been able to adhere to its payment obligation over the past few months. However, since the payments are being received in instalments, no provisions has been made.

2.8 The previous year''s figures have been reworked, regrouped, rearranged and reclassified wherever necessary. Amounts and other disclosures for the preceding year are included as an integral part of the current year financial statements and are to be read in relation to the amounts and other disclosures relating to the current year.


Mar 31, 2013

The above amount represents the best possible estimates airived at on the basis of available information. The uncertainties and timing of the cash flows are dependent on the outcome of the different legal processes which have been invoked by the Company or the claimants as the case may be and therefore cannot be estimated accurately. The Company does not expect any reimbursements in respect of the above contingent liabilities.

In the opinion of the management, no provision is considered necessary for the disputes mentioned above on the grounds that there are fair chances of successful outcome of appeals.

1.1 The company does not have any dues to Micro and Small Enterprises as per the requirement of Section 22 of the Micro, Small and Medium Enterprises Development Act, 2006 (Previous year - Rs. NIL )

1.2 The Employee Stock Option Scheme (SKP ESOP Plan 2010) of the Company was formulated in the year 2010. Under the said Scheme, Options granted have vesting penod of one to three years and exercise period of maximum five years. The details of Options granted, lapsed and exercised as on 31st March, 2012 are as under :

1.3 Employee Benefits :

As per Accounting Standard - 15 " Employee Benefits", the disclosure of Employee Benefits as defined in the Accounting Standard are as follows:

Defined Contribution Plan :

Employee benefits in the form of Provident Fund and Employee State Insurance Scheme are considered as defined contribution plan.

The contributions to the respective fund are made in accordance with the relevant statute and are recognised as expense when employees have rendered service entitling them to the contribution. The contributions to defined contribution plan, recognised as expense in the Statement of Profit and Loss are as under :

Defined Benefit Plan:

Long-term employee benefits in the forms of gratuity are considered as defined benefit obligation. The present value of obligation is determined based on actuarial valuation using projected unit credit method as at the Balance Sheet date. The amount of defined benefits recognised in the Balance Sheet represent the present value of the obligation as adjusted for unrecognised past service cost and as reduced by the fair value of plan assets.

Any asset resulting from this calculation is limited to the discounted value of any economic benefit available in the form of refunds from the plan or reduction in future contribution to the plan. The amount recognised in the Accounts in respect of Employees Benefit Schemes based on actuarial reports are as follows :

b) Other disclosures :

i) Basis of estimates of Rate of escalation in salary :

The estimates of rate of escalation in salary, considered in actuarial valuation, take mto account inflation, seniority, promotion and other relevant factors including supply and demand in the employment market. The above information is certified by the actuary.

ii) The Gratuity and Provident Fund Expenses have been recognised under " Contribution to Provident Fund and Other Funds under Note no. 2.19.

iii) The history of experience adjustments for funded post retirement plans are as follows:

1.4 Segment information as per Accounting Standard - 17 on ''Segment Reporting'' :

The Company is primarily engaged in a single bmsness segment of Broking & Dealing in Securities and related services. All the activities of the company revolves around the mam business. As such there are no separate reportable segments as per Accounting Standard - 17 "Segment Reporting" notified by the Central Government under the Companies (Accounting Standard) Rules 2006.

1.5 Related party disclosures as per Accounting Standard - 18 are given below :

a) Name of the related parties and description of relationship :

i) Subsidiaries : SKP Commodities Ltd.

(Control exists)

ii) Key Managerial Personnel (KMP) : Mr. Naresh PachiSia, Managing director

Mr. Rajesh PachiSia, Managing director

iii) Relatives of Key Managerial Personnel:

Mr. Naresh PachiSia Mrs. Manju PachiSia (Wife)

Mr. Nikunj PachiSia (Son) Mrs. Suraj Devi PachiSia (Mother) Mr.Rajesh PachiSia Mrs. Vatsala PacshiSia (Wife)

Mrs. Suraj Devi PachiSia (Mother) iv) Concerns over which KMP and their M/s. Surendra Kumar PachiSia & Sons (HUF) relatives have substantial interest : M/s. Naresh PachiSia & Sons (HUF)

M/s. Rajesh PachiSia & Sons (HUF) M/s. SKP Insurance Brokers & Advisors Pvt. Ltd.

c) The transactions with related parties have been entered at an amount which are not materially different from those on normal commercial terms.

d) No amount has been written back / written off during the year in respect of due to / from related parties.

e) No amount is due from related parties and hence no provision for doubtful debts in respect of dues from such related parties is required.

f) Figures in brackets pertain to previous year.

1.6 Disclosure under clause 32 of the Listing Agreement :

There are no transactions with Subsidiary Company which are required to be disclosed under Clause 32 of the Listing Agreement with the Bombay Stock Exchange Limited.

1.7 Dividend remitted in foreign currency :

The Company has not remitted any amount in foreign currency on account of dividend. The particulars of dividend payable to non-resident

1.8 The previous year''s figures have been reworked, regrouped, rearranged and reclassified wherever necessary. Amounts and other disclosures for the preceding year are included as an integral part of the current year financial statements and are to be read in relation to the amounts and other disclosures relating to the current year.


Mar 31, 2011

1. Contingent Liability:

The Company has obtained Bank Guarantee of Rs. 335.00 lacs (PY Rs. 335.00 lacs) against pledge of fixed deposit receipt of Rs. 286.77 lacs (P.Y. Rs. 282.08 lacs)

2. Related party Disclosures:

i) Related Party Disclosure as per Accounting Standard -18

Nature of Relationship Name of the Related Party

Subsidiary Company SKP Commodities limited

Key Management Person Mr. Naresh Pachisia

Mr. Rajesh Pachisia

Relatives of Key Management Personnel Mrs. Manju Pachisia

Mrs. Vatsala Pachisia

Mr. Niknnj Pachisia

Mrs. Suraj Dev, Pachisia

Concerns over which KMP exercise M/s. Surendra Kumar Pachisia & Sons (HUF) Significant influence M/s. Naresh Pachisia & Sons (HUF)

M/s. Rajesh Pachisia & Sons (HUF)

iii) No amount pertaining to related parties are outstanding at the year end nor any amount were written off or written back during the year.

3. Employment Benefits:

B. The Company has a defined benefit gratuity plan. Every employee who has completed five years or more of service will receive Gratuity on terms not lower than the amount payable under the Gratuity Act, 1972. The aforesaid scheme is funded with Birla Sun Life Insurance Company Limited. The following table summarizes the components of net benefit expenses recognized in profit & loss account.

4. The Cash Flow Statement has been prepared using indirect method specified in Accounting Standard 3 "Cash Flow Statement"

5. a) The Company has taken Short Term Loan of Rs. 200 lacs from a bank (P.Y Rs. 200 lacs). The said Loan is secured against pledge of Fixed Deposits.

b) Auto Loans are secured against vehicle financed by the respective Banks. Principal amount due within 12 months is Rs. 10.32 lacs (P.Y. Rs. 5.54 lacs).

c) Total Interest amount of Rs. 20,65,852/- Includes interest on Equipment Finance Loan taken by the company amounting to Rs. NIL (Previous Year - Rs. 12,58,197).

6. The Company has pledged fixed deposit receipts of Rs. 50 Lacs (P.Y. Rs. 50 lacs) with National Securities Clearing Corporation Limited.

7. The Equity Shares of the Company is listed at BSE Ltd. and the annual listing fees has been paid for the year.

8. There is no amount due and outstanding to be credited to Investor Education & Protection Fund.

9. The Company has not received any information from any of the suppliers as defined under the "Micro, Small and Medium Enterprises Act, 2006". Hence, the amount outstanding to these units as on 31st March 2011 is not ascertainable.

10. Segment Reporting: The company operates in one segment, and hence segment reporting is not applicable.

11. Figures for the Previous Year have been regrouped / rearranged wherever necessary

12. Additional Information Pursuant to Part IV of Schedule VI to the Companies Act, 1956

Balance Sheet Abstract and Companys General Business Profile


Mar 31, 2010

1. a) Equipment Finance from HDFC Bank is secured by Fixed Assets of the company financed by them and against Fixed Deposits.

b) Short Term Working Capital & Bank Overdraft are secured against fixed deposits.

c) Auto Loans are secured against vehicle financed by the respective financier.

2. Contingent liability not provided in respect of Bank Guarantees of Rs.335.00 Lacs (Previous Year Rs.260.00 Lacs) obtained from Banks to be utilized as and when required.

3. a) Fixed Deposits of Rs. 21,952,107/- (Previous Year Rs. 19,850,943/-) with Banks are under lien against Bank Guarantees.

b) Deposit of Rs.9,84,365/- (Previous Year.Rs.9,84,365/-) and Fixed Deposit of Rs.50,00,000/-( Previous Year.Rs.50,00,000/-) are deposited with The Calcutta Stock Exchange Association Ltd. and National Security Clearing Corporation Ltd. respectively towards margin to be utilised as and when required.

c) Fixed Deposits of Rs.300 Lacs (previous Year Rs.100 Lacs) is under lien with bank for Short Term Loan, Overdraft & Equipment Finance facility enjoyed by the Company.

4. Total Interest amount of Rs.21,75,091/- Includes interest on Equipment Finance taken by the company amounting to Rs. 12,58,197/- (Previous Year- Rs. 673112/-)

5. The Company has not received any information from any of the suppliers as defined under the "Micro, Small and Medium Enterprises Act, 2006". Hence, the amount outstanding to these units as on 31st March 2010 is not ascertainable.

6. The Equity Shares of the Company is listed at BSE Ltd. and the annual listing fees have been paid for the year. The Company has voluntarily de-listed itself from The Calcutta Stock Exchange Association Limited

7. In the opinion of the Board, Current assets, loans and advances have a value on realization in the ordinary course of the business at least equal to the amount at which these are stated.

8. Segment Reporting: The Company has only one segment; hence, segment reporting is not applicable.

9. Miscellaneous Expenses for the year includes Rs. 4.96 Lacs being loss on account of forgery/fraud for which FIR has been lodged and reasonable action is being taken by the Company for recovery of the said amount.

10. Figures for the Previous Year have been regrouped / rearranged wherever necessary.

 
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