KIM ENG SECURITIES THAILAND PUBLIC COMPANY LIMITED by liaoqinmei

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									KIM ENG SECURITIES (THAILAND) PUBLIC COMPANY LIMITED


INTERIM FINANCIAL STATEMENTS

31 MARCH 2011
AUDITOR’S REPORT ON INTERIM FINANCIAL STATEMENTS



To the Shareholders and the Board of Directors of Kim Eng Securities (Thailand) Public Company Limited



I have reviewed the accompanying consolidated and company statements of financial position as at 31 March
2011 and the related consolidated and company statements of comprehensive income, changes in
shareholders’ equity, and cash flows for the three-month periods ended 31 March 2011 and 2010 of Kim Eng
Securities (Thailand) Public Company Limited and its subsidiary, and of Kim Eng Securities (Thailand)
Public Company Limited, respectively. The Company’s management is responsible for the correctness and
completeness of information in these interim financial statements. My responsibility is to issue a report on
these interim financial statements based on my reviews.


I conducted my reviews in accordance with the standard on auditing applicable to review engagements. This
standard requires that I plan and perform the reviews to obtain moderate assurance as to whether the interim
financial statements are free of material misstatement. A review is limited primarily to inquiries of company
personnel and analytical procedures applied to financial data, and thus provides less assurance than an audit,
and accordingly, I do not express an audit opinion.


Based on my reviews, nothing has come to my attention that causes me to believe that the interim
consolidated and company financial statements referred to above are not presented fairly, in all material respects,
in accordance with generally accepted accounting principles.


I have audited the consolidated and company financial statements for the year ended 31 December 2010 of
Kim Eng Securities (Thailand) Public Company Limited and its subsidiary, and of Kim Eng Securities
(Thailand) Public Company Limited, respectively, in accordance with generally accepted auditing standards
and expressed an unqualified opinion on these statements in my report dated 10 February 2011. The
consolidated and company statements of financial position as at 31 December 2010, presented for
comparative purposes, are part of the financial statements which I have audited and issued a report as stated
above, and I have not performed any other auditing procedures subsequent to the date of that report.




Anothai Leekitwattana
Certified Public Accountant (Thailand) No. 3442
PricewaterhouseCoopers ABAS Limited

Bangkok
12 May 2011
Kim Eng Securities (Thailand) Public Company Limited
Statement of Financial Position
As at 31 March 2011 and 31 December 2010



                                                              Consolidated                    The Company only
                                                       (Unaudited)          (Audited)      (Unaudited)         (Audited)
                                                          31 March      31 December          31 March       31 December
                                                               2011              2010              2011              2010
                                            Notes              Baht              Baht              Baht              Baht


Assets


Cash and cash equivalents                      5        408,882,733     1,074,851,436      333,232,579       993,386,492
Deposits at financial institutions             6          3,444,320         1,348,757         3,444,320         1,348,757
Receivables from Clearing House                7      1,574,142,332       121,204,741     1,574,142,332      121,204,741
Securities and Derivatives business
  receivables - net                           8, 9    6,990,119,935     7,105,547,280     6,990,119,935    7,105,547,280
Investments - net                             10         98,106,225       136,499,187        98,106,225      136,499,187
Investments in subsidiary                     11                    -                 -      99,999,980        99,999,980
Loans to employees under
  welfare program                                       319,434,444       317,795,745      319,434,444       317,795,745
Equipment - net                                         109,537,091       103,504,141      108,355,763       102,213,190
Intangible assets - net                                  23,112,356        22,594,826        20,841,071        20,311,788
Foreclosed properties                                     9,886,500         9,886,500         9,886,500         9,886,500
Deposits                                                 38,979,210        39,966,564        38,976,500        39,963,854
Other assets                                  12        110,737,174       103,371,235      108,248,887       101,941,115


Total assets                                          9,686,382,320     9,036,570,412     9,704,788,536    9,050,098,629




The notes to interim financial statements on pages 10 to 25 form an integral part of these interim financial statements.
                                                                                                                           2
Kim Eng Securities (Thailand) Public Company Limited
Statement of Financial Position (Cont’d)
As at 31 March 2011 and 31 December 2010


                                                              Consolidated                    The Company only
                                                       (Unaudited)          (Audited)      (Unaudited)         (Audited)
                                                          31 March      31 December          31 March       31 December
                                                               2011              2010              2011              2010
                                            Notes              Baht              Baht              Baht              Baht
Liabilities and owners’ equity

Liabilities

Borrowings from financial institutions                  355,000,000                   -    355,000,000                     -
Payables to Clearing House                                          -     495,175,561                  -     495,175,561
Securities and Derivatives business
  payables - net                                      3,824,625,662     2,679,693,495     3,824,625,662    2,679,693,495
Derivatives liabilities                       13         15,718,423        44,599,460        15,718,423        44,599,460
Borrowing                                     14                    -     324,324,152                  -     324,324,152
Provisions                                    15         45,666,946        34,453,333        45,563,669       34,453,333
Accrued bonus expenses                                  168,757,747      457,218,493       168,757,747       457,218,493
Accrued corporate income tax                            333,936,195       246,147,912      333,936,195       246,147,912
Accrued other expenses                                   49,471,847        57,454,894        48,178,789        56,351,223
Liabilities under long-term lease             16         18,964,991        19,969,154        18,964,991        19,969,154
Dividend payable                              21        672,536,178           916,404      672,536,178            916,404
Other liabilities                             17         43,262,015        39,888,177        43,143,874        39,349,349

Total liabilities                                     5,527,940,004     4,399,841,035     5,526,425,528    4,398,198,536


Owners’ equity

Share capital                                 18
  Authorised share capital
     572,250,000 ordinary shares of
       Baht 5 each                                    2,861,250,000     2,861,250,000     2,861,250,000    2,861,250,000
  Issued and paid-up share capital
     570,814,500 ordinary shares of
       Baht 5 each
     (2010: 570,814,500 ordinary shares
       of Baht 5 each)                                2,854,072,500     2,854,072,500     2,854,072,500    2,854,072,500
Additional paid-in capital                              523,570,729       523,570,729      523,570,729       523,570,729
Premium on treasury shares                                5,347,943         5,347,943         5,347,943         5,347,943
Retained earnings
  Appropriated                                19        297,385,974       295,431,144      297,385,974       295,431,144
  Unappropriated                                        489,326,143       969,568,034      509,246,835       984,738,750
Less Treasury Stock                                    (11,260,973)      (11,260,973)      (11,260,973)      (11,260,973)

Total owners’ equity                                  4,158,442,316     4,636,729,377     4,178,363,008    4,651,900,093

Total liabilities and owners’ equity                  9,686,382,320     9,036,570,412     9,704,788,536    9,050,098,629



The notes to interim financial statements on pages 10 to 25 form an integral part of these interim financial statements.
                                                                                                                           3
Kim Eng Securities (Thailand) Public Company Limited
Statements of Comprehensive Income
For the three-month periods ended 31 March 2011 and 2010



                                                              Consolidated                    The Company only
                                                       (Unaudited)       (Unaudited)       (Unaudited)       (Unaudited)
                                                          31 March          31 March         31 March          31 March
                                                               2011              2010              2011              2010
                                             Notes             Baht              Baht              Baht              Baht
Revenues


Brokerage fees                                22        671,826,637      488,537,049       671,826,637       488,537,049
Fees and services income                                  6,788,852         4,990,551         6,731,291         4,990,551
Gains on Securities                                       1,428,840         3,254,334         1,428,840         3,254,334
Gains (losses) on Derivatives                            10,573,004         (182,640)        10,573,004         (182,640)
Interest and dividend                                    36,009,888        18,043,782        35,642,338        17,796,621
Interest on margin loans                                 47,752,788        27,253,822        47,752,788        27,253,822
Other incomes                                             5,977,122         3,515,815         6,275,795         3,727,221


Total revenues                                         780,357,131       545,412,713       780,230,693       545,376,958



Expenses


Financial cost                                           17,411,534        10,046,384        17,411,534        10,046,384
Fee and service expenses                                 43,377,035        31,078,955        43,223,530        30,803,955
Operating expenses
  Personnel expenses                                    319,701,245       219,485,897      316,617,297       216,919,153
  Premises and equipment expenses                        69,491,006        63,468,570        69,236,119        63,381,574
  Taxes and duties                                        2,133,904         1,641,079         2,127,217         1,632,623
  Directors' remuneration                                15,800,000         9,691,666        15,800,000         9,691,666
  Information and technology                              9,075,973         8,413,105         8,064,879         7,686,905
  Other expenses                                         21,661,741        18,988,938        21,295,448        18,917,858
Bad debts and doubtful accounts reversal                   (334,393)        (265,139)         (334,393)         (265,139)


Total expenses                                         498,318,045       362,549,455       493,441,631       358,814,979


Profit before income tax                                282,039,086      182,863,258       286,789,062       186,561,979
Income tax                                    23         88,706,374        46,532,621        88,706,374        46,532,621


Net profit for the period                              193,332,712       136,330,637       198,082,688       140,029,358




The notes to interim financial statements on pages 10 to 25 form an integral part of these interim financial statements.
                                                                                                                           4
Kim Eng Securities (Thailand) Public Company Limited
Statements of Comprehensive Income (Cont’d)
For the three-month periods ended 31 March 2011 and 2010



                                                              Consolidated                    The Company only
                                                       (Unaudited)       (Unaudited)       (Unaudited)       (Unaudited)
                                                          31 March          31 March         31 March          31 March
                                                               2011              2010              2011              2010
                                             Notes             Baht              Baht              Baht              Baht


Comprehensive income for the period
Gains on re-measuring
  available-for-sale investments                                   -       33,987,301                  -       33,987,301


Total net comprehensive income                                     -       33,987,301                  -      33,987,301


Total comprehensive income                             193,332,712       170,317,938       198,082,688       174,016,659


Net profit attributable to:
Owners of the parent                                    193,332,712       136,330,637      198,082,688       140,029,358
Non-controlling interests                                           -                 -                -                   -


                                                       193,332,712       136,330,637       198,082,688       140,029,358


Net comprehensive income attributable to:
Owners of the parent                                    193,332,712       170,317,938      198,082,688       174,016,659
Non-controlling interests                                           -                 -                -                   -


                                                       193,332,712       170,317,938       198,082,688       174,016,659


Earnings per share for profit attributable
  to the equity holders of the parent


Basic earnings per share (Baht)               24                0.34              0.24              0.35              0.25


Diluted earnings per share (Baht)             24                0.34              0.24             0.35              0.25




The notes to interim financial statements on pages 10 to 25 form an integral part of these interim financial statements.
                                                                                                                           5
Kim Eng Securities (Thailand) Public Company Limited
Statements of Changes in Shareholders’ Equity
For the three-month periods ended 31 March 2011 and 2010

                                                                                                                                                                                        (Unaudited)
                                                                                                                         Consolidated
                                                                                                          Attributable to equity holders of the parent
                                                                                                              Share                         Unrealised
                                                   Issued and         Additional      Premium on       subscriptions       Legal and           gain on
                                                      paid-up           paid-in          treasury        received in treasury share        revaluation Unappropriated     Treasury
                                                 share capital           capital            stock           advance           reserve on investment retained earnings        stock            Total
                                                         Baht              Baht              Baht              Baht              Baht             Baht          Baht          Baht            Baht

Beginning balance as at 1 January 2011          2,854,072,500       523,570,729          5,347,943                  -      295,431,144             -     969,568,034    (11,260,973)   4,636,729,377
Comprehensive income                                        -                 -                  -                  -                -             -     193,332,712               -     193,332,712
Appropriation of legal reserve (Note 19)                    -                 -                  -                  -        1,954,830             -      (1,954,830)              -               -
Dividend paid (Note 21)                                     -                 -                  -                  -                 -            -    (671,619,773)              -   (671,619,773)

Ending balance as at 31 March 2011              2,854,072,500       523,570,729          5,347,943                  -      297,385,974             -     489,326,143    (11,260,973)   4,158,442,316

                                                                                                                                                                                        (Unaudited)
                                                                                                                         Consolidated
                                                                                                          Attributable to equity holders of the parent
                                                                                                              Share                         Unrealised
                                                   Issued and         Additional      Premium on       subscriptions       Legal and           gain on
                                                      paid-up           paid-in          treasury        received in treasury share        revaluation Unappropriated     Treasury
                                                 share capital           capital            stock           advance           reserve on investment retained earnings        stock            Total
                                                         Baht              Baht              Baht              Baht              Baht             Baht          Baht          Baht            Baht

Beginning balance as at 1 January 2010          2,850,725,000       522,468,329                   -          591,500       258,225,862             -     911,941,340    (15,094,030)   4,528,858,001
Increase in share capital/share
   subscription (Note 18)                            3,347,500         1,102,400                  -        (591,500)                 -             -                -              -       3,858,400
Comprehensive income                                         -                 -                  -                -                 -    33,987,301     136,330,637               -     170,317,938
Appropriation of legal reserve                               -                 -                  -                -         7,001,468             -      (7,001,468)              -               -
Dividend paid (Note 21)                                      -                 -                  -                -                  -             -   (568,609,300)              -   (568,609,300)

Ending balance as at 31 March 2010              2,854,072,500       523,570,729                   -                 -      265,227,330    33,987,301     472,661,209    (15,094,030)   4,134,425,039




The notes to interim financial statements on pages 10 to 25 form an integral part of these interim financial statements.
                                                                                                                                                                                                  6
Kim Eng Securities (Thailand) Public Company Limited
Statements of Changes in Shareholders’ Equity (Cont’d)
For the three-month periods ended 31 March 2011 and 2010

                                                                                                                                                                                        (Unaudited)
                                                                                                                      The Company only
                                                                                                          Attributable to equity holders of the parent
                                                                                                              Share                         Unrealised
                                                   Issued and         Additional      Premium on       subscriptions       Legal and           gain on
                                                      paid-up           paid-in          treasury        received in treasury share        revaluation Unappropriated     Treasury
                                                 share capital           capital            stock           advance           reserve on investment retained earnings        stock            Total
                                                         Baht              Baht              Baht              Baht              Baht             Baht          Baht          Baht            Baht

Beginning balance as at 1 January 2011          2,854,072,500       523,570,729          5,347,943                  -      295,431,144             -     984,738,750    (11,260,973)   4,651,900,093
Comprehensive income                                        -                 -                  -                  -                -             -     198,082,688               -     198,082,688
Appropriation of legal reserve (Note 19)                    -                 -                  -                  -        1,954,830             -      (1,954,830)              -               -
Dividend paid (Note 21)                                     -                 -                  -                  -                 -            -    (671,619,773)              -   (671,619,773)

Ending balance as at 31 March 2011              2,854,072,500       523,570,729          5,347,943                  -      297,385,974             -     509,246,835    (11,260,973)   4,178,363,008

                                                                                                                                                                                        (Unaudited)
                                                                                                                      The Company only
                                                                                                          Attributable to equity holders of the parent
                                                                                                              Share                         Unrealised
                                                   Issued and         Additional      Premium on       subscriptions       Legal and           gain on
                                                      paid-up           paid-in          treasury        received in treasury share        revaluation Unappropriated     Treasury
                                                 share capital           capital            stock           advance           reserve on investment retained earnings        stock            Total
                                                         Baht              Baht              Baht              Baht              Baht             Baht          Baht          Baht            Baht

Beginning balance as at 1 January 2010          2,850,725,000       522,468,329                   -          591,500       258,225,862             -     911,938,887    (15,094,030)   4,528,855,548
Increase in share capital/share
   subscription (Note 18)                            3,347,500         1,102,400                  -        (591,500)                 -             -                -              -      3,858,400
Comprehensive income                                         -                 -                  -                -                 -    33,987,301     140,029,358               -    174,016,659
Appropriation of legal reserve                               -                 -                  -                -         7,001,468             -      (7,001,468)              -               -
Dividend paid (Note 21)                                      -                 -                  -                -                  -             -   (568,609,300)              -   (568,609,300)

Ending balance as at 31 March 2010              2,854,072,500       523,570,729                   -                 -      265,227,330    33,987,301     476,357,477    (15,094,030)   4,138,121,307




The notes to interim financial statements on pages 10 to 25 form an integral part of these interim financial statements.
                                                                                                                                                                                                  7
Kim Eng Securities (Thailand) Public Company Limited
Statements of Cash Flows
For the three-month periods ended 31 March 2011 and 2010



                                                                    Consolidated                         The Company only
                                                             (Unaudited)         (Unaudited)          (Unaudited)           (Unaudited)
                                                               31 March             31 March            31 March              31 March
                                                                     2011                2010                 2011                 2009
                                                                     Baht                Baht                 Baht                 Baht
Cash flows from operating activities
Net profit before income tax for the period                  282,039,086          182,863,258          286,789,062          186,561,979
Adjustments to reconcile net profit to cash
  (paid) provided by operating activities:
  Depreciation and amortisation                                13,788,609          14,924,228           13,607,233           14,876,062
  Bad debts and doubtful accounts reversal                      (334,393)            (265,139)           (334,393)             (265,139)
  Allowance for doubtful account
     -other receivable                                                   -            (50,000)                    -             (50,000)
  Gains on revaluation of investments                         (4,069,432)        (31,606,272)          (4,069,432)          (31,606,272)
  Unrealised losses on revaluation
     of derivatives liabilities                                 5,397,280                     -          5,397,280                     -
  Gains on disposals of equipment                               (813,087)              (2,322)           (813,087)               (2,322)
  Retirement benefit                                            6,824,585             628,750            6,721,308              628,750
  Financial cost                                               17,092,755           9,780,803           17,092,755            9,780,803
  Amortised interest expense of financial lease                   318,779             265,581              318,779              265,581
  Interest income                                            (85,256,496)        (45,875,326)         (84,888,946)          (45,628,165)
  Cash paid for interest                                     (15,031,246)          (9,734,215)        (15,031,246)           (9,734,215)
  Cash paid for income tax                                      (918,091)            (729,429)           (918,091)             (729,429)

Operating profit before changes in operating
  assets and liabilities                                     219,038,349          120,199,917          223,871,222          124,097,633
(Increase) decrease in operating assets
  Deposits at financial institutions                          (2,095,563)                (289)         (2,095,563)                 (289)
  Receivables from Clearing House                         (1,452,937,591)       (227,673,733)      (1,452,937,591)         (227,673,733)
  Securitites and Derivatives
     business receivables                                    115,336,407      (2,554,388,051)          115,336,407     (2,554,388,051)
  Investments                                                  42,462,394        (25,549,287)           42,462,394          (25,549,287)
  Loans to employees under welfare program                    (1,638,699)        (22,726,050)          (1,638,699)          (22,726,050)
  Deposits                                                        987,354             (49,829)             987,354              (49,549)
  Other assets                                                (6,034,934)          (9,882,256)         (5,000,109)           (9,367,120)
Increase (decrease) in operating liabilities
  Payables from Clearing House                              (495,175,561)         517,844,754        (495,175,561)          517,844,754
  Securities and Derivatives business payables              1,144,932,167       1,291,543,917        1,144,932,167         1,291,543,917
  Derivatives liabilities                                    (34,278,317)                     -       (34,278,317)                     -
  Provisions                                                             -         (2,714,848)                    -          (2,714,848)
  Accrued bonus expenses                                    (288,460,746)       (199,351,801)        (288,460,746)         (198,971,801)
  Accrued other expenses                                     (11,706,545)          (2,642,093)        (11,895,932)           (3,138,810)
  Other liabilities                                             3,373,838          16,650,040            3,794,525           16,570,127

Net cash used in operating activities                       (766,197,447)     (1,098,739,609)        (760,098,449)     (1,094,523,107)




The notes to interim financial statements on pages 10 to 25 form an integral part of these interim financial statements.
                                                                                                                                      8
Kim Eng Securities (Thailand) Public Company Limited
Statements of Cash Flows (Cont’d)
For the three-month periods ended 31 March 2011 and 2010




                                                                    Consolidated                         The Company only
                                                             (Unaudited)         (Unaudited)          (Unaudited)           (Unaudited)
                                                               31 March             31 March            31 March              31 March
                                                                     2011                2010                 2011                 2010
                                                                     Baht                Baht                 Baht                 Baht
Cash flows from investing activities
Cash received from interest                                   84,350,822           33,204,742           84,006,614           32,965,820
Proceeds from disposals of equipment                            1,258,326                3,832           1,258,326                3,832
Purchases of equipment                                       (11,806,885)          (4,507,886)        (11,806,885)           (4,436,841)
Purchases of intangible assets                                (2,069,356)          (5,821,385)         (2,009,356)           (5,176,384)


Net cash provided by investing activities                     71,732,907           22,879,303           71,448,699           23,356,427


Cash flows from financing activities
Cash received from borrowings                              7,344,000,000                     -      7,344,000,000                      -
Cash paid to borrowings                                   (7,314,500,000)                    -     (7,314,500,000)                     -
Cash received from increase in share capital                             -          3,858,400                     -           3,858,400
Cash paid on principal of long-term lease                     (1,004,163)            (907,832)         (1,004,163)             (907,832)


Net cash provided by financing
  activities                                                  28,495,837            2,950,568           28,495,837            2,950,568


Net decrease in cash and cash equivalents                   (665,968,703)     (1,072,909,738)        (660,153,913)     (1,068,216,112)
Cash and cash equivalents,
   at beginning of the period                               1,074,851,436       2,201,405,991          993,386,492         2,103,210,806


Cash and cash equivalents, at end of the period              408,882,733        1,128,496,253          333,232,579         1,034,994,694




Non-cash items
Accrued dividend                                             671,619,773          568,609,300          671,619,773          568,609,300
Equipment                                                       2,519,059           1,609,581            2,519,059            1,609,581
Provision for cost of dismantling and removing                  4,389,028                    -           4,389,028                     -




The notes to interim financial statements on pages 10 to 25 form an integral part of these interim financial statements.
                                                                                                                                      9
Kim Eng Securities (Thailand) Public Company Limited
Unaudited Condensed Notes to the Interim Consolidated and Company Financial Statements
For the three-month periods ended 31 March 2011 and 2010


1    General information


     Kim Eng Securities (Thailand) Public Company Limited (“the Company”) is a public limited company
     incorporated and resident in Thailand. The address of the company’s registered office is as follows:

     999/9 The Offices at Central World, 20th - 21st and 24th Floor, Rama 1 Road, Pathumwan, Bangkok, 10330.

     The Company is listed on the Stock Exchange of Thailand. For reporting purposes, the Company and its
     subsidiary are referred to as the Group.

     These interim consolidated and company financial statements were authorised for issue by the Board of Directors
     on 12 May 2011.

     These interim consolidated and company financial statements have been reviewed, but not audited.


2    Basis of preparation


     These interim consolidated and company financial statements are prepared in accordance with Thai generally
     accepted accounting principles under the Accounting Act B.E. 2543, being those Thai Accounting Standards
     issued under the Accounting Professions Act B.E. 2547, and the financial reporting requirements of the Securities
     and Exchange Commission. The primary financial statements (i.e., statements of financial position, statements of
     comprehensive income, changes in shareholders’ equity and cash flows) are prepared in the full format as
     required by the Securities and Exchange Commission. The notes to the financial statements are prepared in a
     condensed format according to Thai Accounting Standard 34 (formerly TAS 41), “Interim Financial Reporting”
     and additional notes are presented as required by the Securities and Exchange Commission under the Securities
     and Exchange Act.

     An English version of the interim consolidated and company financial statements have been prepared from the
     interim financial statements that are in the Thai language. In the event of a conflict or a difference in
     interpretation between the two languages, the Thai language interim financial statements shall prevail.


3    Summary of significant accounting policies


     The accounting policies used in the preparation of the interim financial statements are consistent with those used
     in the annual financial statements for the year ended 31 December 2010 except as described in note 4 which are
     accounting policies regarding costs of dismantling and restoring the Group’s site and employee benefits. The
     impact of the adoption of new accounting policies are summarised as follows:

     •   TAS 1 (Revised 2009), the revised standard will prohibit the presentation of items of income and expenses
         in the statement of changes in equity. The Group chooses to present the statement of comprehensive
         income in one statement. Where the Group restates or reclassifies comparative information, it will be
         required to present a restated statement of financial position as at the beginning comparative period in
         addition to the current requirement to present statement of financial position at the end of the current
         period and comparative period. However, for the financial statements which period beginning on or after 1
         January 2011 and are the first period apply this standard, the Group can choose to present statement of
         financial position only two statements without the statement of financial position as at the beginning
         comparative period. As at 31 December 2010 the Group presented Gains on re-measuring available-for-
         sale-investments in statements of comprehensive income amounting to Baht 33,987,301.




                                                                                                                    10
Kim Eng Securities (Thailand) Public Company Limited
Unaudited Condensed Notes to the Interim Consolidated and Company Financial Statements
For the three-month periods ended 31 March 2011 and 2010


3    Summary of significant accounting policies (cont’d)


     •   TAS 16 (Revised 2009), the revised standard requires the Group to include in cost of property plant and
         equipment, an initial estimate of the costs of dismantling and removing the item and restoring the site on
         which it is located, when the Group has obligation to do. An entity requires that an item of property, plant
         and equipment with a cost that is significant in relation to the total cost of the item shall be depreciated
         separately. The revised standard also requires an entity to review useful life, residual value and
         depreciation method at least at each financial year-end. As at 1 January 2011 the Group set up the
         provision for dismantling cost of office building amounting to Baht 4,389,028. The provision was
         recorded as building improvement against provision. The building improvement was depreciated by using
         straight line method. The estimated useful lives is equivalent to the residual life of rental contract.

     •   TAS 19 deal with accounting for employee benefit. The Group has 2 categories of employee benefit: a)
         short-term employee benefits b) post-employment benefits (including defined contribution plan and
         defined benefit plan). The standard requires the entity to measure the defined benefit plan by using the
         Projected Unit Credit method (PUC). The Group chooses to recognise any actuarial gain or loss for
         defined benefit plan in profit and loss. Actuarial gain or loss for other long-term employee benefit shall
         recognise in profit and loss. As at 1 January 2011, the Group calculated the provisions for post-
         employment benefits. The Group recognises the personnel expenses by applying straight line method
         throughout 5 years as stated in notification of Federation of Accounting Professions no.17/2554. The
         impact of the adoption of accounting policies are as follows:


                                                                              Consolidated      The Company only
                                                                                      Baht                 Baht
         Statement of financial position as at 1 January 2011
         Provisions for post-employment benefits                               71,525,082                71,147,666

         Statement of comprehensive income for the period
           ended 31 March 2011
         Personnel expenses                                                       6,824,585                6,721,308

     New accounting standards, amendments to accounting standards and new interpretation

     The following new accounting standards, amendments to accounting standards and new interpretation are
     mandatory for the accounting periods beginning on or after 1 January 2013, but the Group has not early
     adopted them:

     TAS 12                      Income taxes
     TAS 20 (Revised 2009)       Accounting for Government Grants and Disclosure of Government Assistance
     TAS 21 (Revised 2009)       The Effects of Changes in Foreign Exchange Rates
     TSIC 10                     Government Assistance – No Specific Relation to Operating Activities
     TSIC 21                     Income Taxes – Recovery of Revalued Non-Depreciable Assets
     TSIC 25                     Income Taxes – Changes in the Tax Status of an Entity or its Shareholders

     The Group’s management has determined that the new accounting standards, amendments to accounting
     standards and new interpretation will not significantly impact the financial statements being presented.

     Costs that are incurred unevenly during the financial year are anticipated or deferred in the interim report only
     if it would also be appropriate to anticipate or defer such cost at the end of the financial year.




                                                                                                                   11
Kim Eng Securities (Thailand) Public Company Limited
Unaudited Condensed Notes to the Interim Consolidated and Company Financial Statements
For the three-month periods ended 31 March 2011 and 2010


4    New accounting policies


     4.1 Employee benefits

          The Group has post-employment benefits both defined contribution plans and defined benefit. A defined
          contribution plan is a pension plan under which the Group pays fixed contributions into a separate entity.
          The Group has no legal or constructive obligations to pay further contributions if the fund does not hold
          sufficient assets to pay all employees the benefits relating to employee service in the current and prior
          periods. A defined benefit plan is a pension plan that is not a defined contribution plan. Typically defined
          benefit plans define an amount of pension benefit that an employee will receive on retirement, usually
          dependent on one or more factors such as age, years of service and compensation.

          •    Defined benefit plans

               Retirement benefit

               Under Labour Laws applicable in Thailand and Group’s employment policy, all employees completing
               120 days of service are entitled to severance pay on termination or retrenchment without cause or
               upon retirement age of 60. The severance pay will be at the rate according to number of years of
               service as stipulated in the Labor Law which is currently at a maximum rate of 300 days of final
               salary.

          •    Defined contribution plans

               Provident fund

               The Group operates a provident fund, being a defined contribution plan, the assets for which are held
               in a separate trust fund. The provident fund is funded by payments from employees and by the Group.
               The Group’s contributions to the provident fund are charged to the income statement in the years to
               which they relate.


5    Cash and cash equivalents

                                                      Consolidated                       The Company only
                                                   31 March    31 December              31 March   31 December
                                                       2011           2010                  2011          2010
                                                       Baht           Baht                  Baht          Baht
     Cash on hand                                    528,400            518,408           523,428           513,408
     Current and saving deposits               1,317,645,414      1,381,852,700     1,317,000,232     1,375,392,756
     Fixed deposits with remaining
       maturity less than 3 months                 34,000,000        34,000,000                   -                 -
     Promissory notes with remaining
       maturity less than 3 months              5,061,000,000 5,311,000,000 5,020,000,000 5,265,000,000
     Less Deposits on behalf of customers     (6,004,291,081) (5,652,519,672) (6,004,291,081) (5,647,519,672)

     Total cash and cash equivalents             408,882,733      1,074,851,436       333,232,579       993,386,492

     The deposits on behalf of customers relate to cash deposited by customers which the Group has the obligation to
     repay to the customers on demand. In accordance with notification No. Sor Thor 44/2543 dated 12 September 2000,
     issued by the office of the Securities and Exchange commission, this amount was excluded from cash and cash
     equivalents held by the Group.




                                                                                                                   12
Kim Eng Securities (Thailand) Public Company Limited
Unaudited Condensed Notes to the Interim Consolidated and Company Financial Statements
For the three-month periods ended 31 March 2011 and 2010


6    Deposits at financial institutions
                                                        Consolidated                    The Company only
                                                     31 March    31 December           31 March   31 December
                                                         2011           2010               2011          2010
                                                         Baht           Baht               Baht          Baht
     Fixed deposits                                      7,229             6,881           7,229           6,881
     Restricted cash                                 3,437,091         1,341,876       3,437,091       1,341,876
     Total Deposits at financial institutions        3,444,320         1,348,757       3,444,320       1,348,757

     As at 31 March 2011, fixed deposits of Baht 3 million (31 December 2010: Baht 1 million) are pledged as
     collateral to local banks for letter of guarantees.

7    Receivables from Clearing House
                                                        Consolidated                    The Company only
                                                     31 March    31 December           31 March   31 December
                                                         2011           2010               2011          2010
                                                         Baht           Baht               Baht          Baht
     Receivables from Thai Clearing
      House Co., Ltd. (TCH)                       1,808,236,406      335,771,322   1,808,236,406    335,771,322
     Less Receivables from Clearing
              House on behalf
              of customers                        (234,094,074)    (214,566,581)   (234,094,074)   (214,566,581)
     Total                                        1,574,142,332      121,204,741   1,574,142,332    121,204,741


8    Securities and Derivatives business receivables - net

     Balance of securities business receivables as at 31 March 2011 and 31 December 2010 are as follows:

                                                      Consolidated                     The Company only
                                                   31 March    31 December            31 March   31 December
                                                       2011           2010                2011          2010
                                                       Baht           Baht                Baht          Baht
     Customers’ cash accounts                   2,243,675,502     2,636,297,388    2,243,675,502   2,636,297,388
     Credit balance transactions                4,660,358,163     4,355,976,757    4,660,358,163   4,355,976,757
     Collateral assets                                      -        23,402,500                -      23,402,500
     Securities borrowing and lending              65,014,483        57,341,380       65,014,483      57,341,380
     Other receivables                            259,718,581       260,058,252      259,718,581     260,058,252
     Total securities business receivables      7,228,766,729     7,333,076,277    7,228,766,729   7,333,076,277
     Add Accrued interest receivables              33,855,880        34,281,211       33,855,880      34,281,211
     Less Allowance for doubtful
             accounts (Note 9)                  (276,680,007)     (277,014,400)    (276,680,007)   (277,014,400)
     Net securities business receivables
      and accrued interest receivables          6,985,942,602     7,090,343,088    6,985,942,602   7,090,343,088

     Derivative business receivables               4,177,333        15,204,192        4,177,333      15,204,192
     Less Allowance for doubtful
            accounts (Note 9)                               -                 -                -               -
     Derivative business receivables - net         4,177,333        15,204,192        4,177,333       15,204,192
     Total securities and derivatives
      business receivables - net                6,990,119,935     7,105,547,280    6,990,119,935   7,105,547,280

     As at 31 March 2011, the Group had loans and receivables totalling approximately Baht 277 million
     (31 December 2010: Baht 277 million) for which recognition of interest income had been discontinued in
     accordance with the office of the Securities and Exchange Commission’s notification dated 15 February 2001.

                                                                                                              13
Kim Eng Securities (Thailand) Public Company Limited
Unaudited Condensed Notes to the Interim Consolidated and Company Financial Statements
For the three-month periods ended 31 March 2011 and 2010


8    Securities and Derivatives business receivables - net (Cont’d)


     The Group has classified Securities and Derivatives business receivables in accordance with the notification of
     the office of the Securities and Exchange Commission dated 15 February 2001, regarding the accounting for
     sub-standard loans as follows:

                                                               Consolidated and the Company only
                                                                         31 March 2011
                                                                           Allowance for doubtful accounts
                                                            Total debts     Amount set up              Amount
                                                   (including accrued               by the            required
                                                  interest receivables)          Company               by SEC
                  Classifications                         Million Baht        Million Baht        Million Baht
     Normal debts                                              6,990.01                     -                     -
     Substandard debts                                            14.41                 14.30                     -
     Doubtful debts                                              262.38                262.38                262.38

     Total                                                     7,266.80                276.68                262.38

                                                               Consolidated and the Company only
                                                                        31 December 2010
                                                                            Allowance for doubtful accounts
                                                            Total debts     Amount set up               Amount
                                                   (including accrued                by the            required
                                                  interest receivables)          Company                by SEC
                  Classifications                         Million Baht         Million Baht        Million Baht
     Normal debts                                              7,105.43                     -                     -
     Substandard debts                                            14.48                 14.36                     -
     Doubtful debts                                              262.65                262.65                262.65

     Total                                                     7,382.56                277.01                262.65

     The Group had set up the allowance for doubtful debts based on the receivables classification at the rate higher
     than the minimum rate as suggested by the office of the Securities and Exchange Commission of Thailand, and
     also by reviewing the individual debtor’s repayment ability, taking into consideration the recovery risk and the
     value of the collateral.


9    Allowance for doubtful accounts

                                                       Consolidated                      The Company only
                                                    31 March    31 December             31 March   31 December
                                                        2011           2010                 2011          2010
                                                        Baht           Baht                 Baht          Baht
     Beginning balance of the period/year        277,014,400        292,043,784       277,014,400      292,043,784
     Add Doubtful accounts                             5,277              79,688            5,277            79,688
     Less Write off                                        -       (14,004,375)                 -      (14,004,375)
          Reversal of doubtful accounts            (339,670)         (1,104,697)        (339,670)       (1,104,697)

     Ending balance of the period/year           276,680,007       277,014,400        276,680,007       277,014,400




                                                                                                                  14
Kim Eng Securities (Thailand) Public Company Limited
Unaudited Condensed Notes to the Interim Consolidated and Company Financial Statements
For the three-month periods ended 31 March 2011 and 2010


10   Investments - net


     Cost and fair value of investments as at 31 March 2011 and 31 December 2010 are as follows:

                                                        Consolidated and             Consolidated and
                                                       the Company only             the Company only
                                                          31 March 2011             31 December 2010
                                                           Cost/                        Cost/
                                                   Amortised cost    Fair value Amortised cost    Fair value
                                                            Baht          Baht          Baht           Baht
     Trading securities
      Trading equity securities                        79,695,770        80,494,587       122,158,163      119,211,875
      Trading - Unit trusts                            80,000,000        80,482,978         80,000,000       80,158,652
      Add(Less) Revaluation adjustments                 1,281,795                 -        (2,787,636)                -
      Less Investment on behalf of customers         (80,000,000)      (80,000,000)      (80,000,000)      (80,000,000)
       Total trading securities - net                  80,977,565        80,977,565      119,370,527       119,370,527
     General investments
      General investments                              31,791,160        25,258,480        31,791,160        24,219,754
      Less Impairment loss                           (14,662,500)                 -      (14,662,500)                 -
       Total general investments                       17,128,660        25,258,480        17,128,660        24,219,754
       Total investments - net                         98,106,225      106,236,045       136,499,187       143,590,281

     Fair value of collateral investments in equity securities as at 31 March 2011 and 31 December 2010 are as follows:

                                                        Consolidated and             Consolidated and
                                                       the Company only             the Company only
                                                          31 March 2011             31 December 2010
                                                           Cost/                        Cost/
                                                   Amortised cost    Fair value Amortised cost    Fair value
                                                            Baht          Baht          Baht           Baht

     Collateral investments
      Trading securities                                7,622,000        19,512,109         7,622,000        12,060,500
      Less Impairment loss                                      -                 -                 -                 -
       Total Collateral investments                     7,622,000        19,512,109         7,622,000        12,060,500

     As at 31 March 2011, the Group has investments in equity which is used as collateral in court and classified as
     general investments, amounting to Baht 7,622,000 (31 December 2010: 7,622,000).




                                                                                                                      15
Kim Eng Securities (Thailand) Public Company Limited
Unaudited Condensed Notes to the Interim Consolidated and Company Financial Statements
For the three-month periods ended 31 March 2011 and 2010


11   Investment in subsidiary


     The Company’s investment in its subsidiary, which is a company registered under Thai laws and operating in Thailand is summarised below:

                                                                                                                                                        Investment
                                                                         Paid-up share capital               Percentage of holding                     Cost method
                                                                         31 March     31 December            31 March      31 December            31 March      31 December
                                         Type of          Type of              2011            2010               2011             2010                 2011             2010
          Name of company               business      relationship     Million Baht    Million Baht                 %                %          Million Baht     Million Baht
     Kim Eng Asset Management             Asset         Subsidiary              100               100             99.99             99.99               100              100
      (Thailand) Co., Ltd.           management




                                                                                                                                                                           16
Kim Eng Securities (Thailand) Public Company Limited
Unaudited Condensed Notes to the Interim Consolidated and Company Financial Statements
For the three-month periods ended 31 March 2011 and 2010


12   Other assets

                                                    Consolidated                     The Company only
                                                 31 March    31 December            31 March   31 December
                                                     2011           2010                2011          2010
                                                     Baht           Baht                Baht          Baht
     Clearing fund                               58,064,730       56,390,356       58,064,729    56,390,356
     Accrued income                               4,922,558        3,259,430        4,870,374     3,230,652
     Prepaid expenses                            30,783,045       25,387,977       29,241,625    24,716,334
     Others                                      16,966,841       18,333,472       16,072,159    17,603,773

     Total                                     110,737,174       103,371,235      108,248,887   101,941,115


13   Derivatives liabilities


     As at 31 March 2011, the Company has outstanding derivative warrants as follows:

                                                                   Consolidated and The Company only
                                                                       Fair value                Notional
                                                                      Asset        Liability      amount
                                                                      Baht            Baht           Baht

     Derivative warrant                                                     -      15,718,423   125,323,235
                                                                            -      15,718,423   125,323,235

     As at 31 December 2010, the Company has outstanding derivative warrants as follows:

                                                                   Consolidated and The Company only
                                                                       Fair value                Notional
                                                                      Asset        Liability      amount
                                                                      Baht            Baht           Baht

     Derivative warrant                                                     -      44,599,460   380,052,010
                                                                            -      44,599,460   380,052,010




                                                                                                         17
Kim Eng Securities (Thailand) Public Company Limited
Unaudited Condensed Notes to the Interim Consolidated and Company Financial Statements
For the three-month periods ended 31 March 2011 and 2010


14   Borrowings

                                                     Consolidated and The Company only
                                                                       31 March 2011
                                     Interest       Less than
                                         rate          1 year      1 - 5 years  Over 5 years                    Total
                                           %             Baht            Baht          Baht                     Baht

     Borrowings                             -                 -                 -                  -                 -
                                                              -                 -                  -                 -

                                                     Consolidated and The Company only
                                                                     31 December 2010
                                     Interest       Less than
                                         rate          1 year      1 - 5 years Over 5 years                     Total
                                           %             Baht            Baht         Baht                      Baht

     Borrowings                          2.5      324,324,152                   -                  -     324,324,152
                                                  324,324,152                   -                  -     324,324,152

     As at 31 December 2010, the Group has an outstanding of short term bill of exchanges, which are matured
     within 3 months after trade date. The bill of exchange was traded to individual customers.


15   Provisions

                                                       Consolidated                       The Company only
                                                    31 March    31 December              31 March   31 December
                                                        2011           2010                  2011          2010
                                                        Baht           Baht                  Baht          Baht
     Opening balance                               34,453,333         34,653,183        34,453,333         34,653,183
     Increase(decrease) during the
     period/year                                   11,213,613          (199,850)        11,110,336          (199,850)

     Closing balance                               45,666,946         34,453,333        45,563,669         34,453,333

     As at 31 March 2011 and 31 December 2010, the provision comprised the obligations of the Company to
     Nithipat Capital Public Co., Ltd., (“Nithipat”), the former parent company, of approximately Baht 10.63 million in
     case that Nithipat cannot collect their securities debts which have not been transferred as mentioned in the
     Asset Transfer Letter dated 14 August 1996. Additional provision is set up for the notification of approximately
     Baht 15.70 million from a customers’ account of Yuanta Securities (Thailand) Limited demanding the
     Company to pay for damage claims from the event occurred before the customer was transferred to the
     Company.

     As at 31 March 2011, the Group has post employment benefits, payable to employees under the Thai labor law for
     Bath 14.95 million (31 December 2010: Baht 8.13 million) and has been recorded in the financial statements. The
     Group also has provision for dismantling cost amounting to Baht 4.3 million.




                                                                                                                    18
Kim Eng Securities (Thailand) Public Company Limited
Unaudited Condensed Notes to the Interim Consolidated and Company Financial Statements
For the three-month periods ended 31 March 2011 and 2010


16   Liabilities under long-term lease


     Liabilities under long-term lease contracts represent finance lease for vehicles. The balance as at 31 March 2011
     and 31 December 2010 comprise:

                                                       Consolidated                      The Company only
                                                    31 March    31 December             31 March   31 December
                                                        2011           2010                 2011          2010
                                                        Baht           Baht                 Baht          Baht
     Minimum lease payments obligation
      under long-term lease contracts              21,613,332        22,937,373        21,613,332        22,937,373
     Less Deferred interest                        (2,648,341)       (2,968,219)       (2,648,341)       (2,968,219)
                                                   18,964,991        19,969,154        18,964,991         19,969,154

     Current portion due within one year            5,082,289         4,245,172         5,082,289          4,245,172
     Portion due after one year                    13,882,702        15,723,982        13,882,702         15,723,982
                                                   18,964,991        19,969,154        18,964,991         19,969,154


17   Other liabilities

                                                       Consolidated                      The Company only
                                                    31 March    31 December             31 March   31 December
                                                        2011           2010                 2011          2010
                                                        Baht           Baht                 Baht          Baht
     VAT payable                                   16,061,784        14,454,803        16,061,784         14,454,803
     Withholding tax payable                       16,615,544        13,849,519        16,504,623         13,317,911
     Others                                        10,584,687        11,583,855        10,577,467         11,576,635

     Total                                         43,262,015        39,888,177        43,143,874         39,349,349




                                                                                                                   19
Kim Eng Securities (Thailand) Public Company Limited
Unaudited Condensed Notes to the Interim Consolidated and Company Financial Statements
For the three-month periods ended 31 March 2011 and 2010


18   Share capital


     During the three-month period ended 31 March 2010, the warrant holders exercise their own rights, then the
     issued share capital increase for 669,500 shares.

     On 8 October 2008, the Board of Directors approved to buy back 56,000,000 ordinary shares (representing not
     more than 10% of the issued shares) at a price equivalent to the bid prices on the Stock Exchange of Thailand,
     within a total budget of no more than Baht 672 million, not exceed the Company’s retained earning. The
     repurchase period should be done during 24 October 2008 to 24 April 2009. The method and period for selling
     of the treasury shares will be decided by the Board of Directors after the completion date of the buy back
     6 months, but not more than 3 years and such sale will be made at a price of not less than 85 percent of the
     average closing prices of the 5 working days prior to the selling date.

     According to the Federation of Accounting Professions’ announcement no. Sor.Sor.Vor.Bor.Chor. 016/2548
     dated 4 February 2005, it requires public companies limited that treasury shares to have retained earnings not
     less than the amount of the treasury shares remaining in the account. In the event the retained earnings is used
     to pay dividends, the retained earnings after the dividend payment should not be less than the treasury shares.
     This is to comply with the announcement of the Judicial Council, which deliberated the issue of treasury shares
     schemes under Section 66/1(2) of the Public Limited Companies Act B.E. 2535.

     The Company had treasury shares of 2,205,200 shares representing 0.39 percent of the total sold shares
     outstanding on the date when the Board resoluted the share repurchase. The total treasury shares are Baht
     15.09 million and the Company has appropriated the retained earnings as the treasury shares reserve for the
     whole amount. During the year ended 31 December 2010, the Company sold repurchased shares of 560,000
     shares. The remaining outstanding shares were 1,645,200 shares, amounting to Baht 11.26 million.

                                                        Consolidated and The Company only
                                                                                       Share
                                       Number of         Ordinary         Share subscription
                                          shares            share      premium    in advance                  Total
                                          Shares             Baht          Baht         Baht                  Baht
     At 1 January 2010                567,939,800 2,835,630,970         522,468,329        591,500    3,358,690,799
     Issue of shares                      669,500     3,347,500           1,102,400      (591,500)        3,858,400
     Add Sold treasury shares             560,000     3,833,057                   -              -        3,833,057
     Add Premium on
             treasury shares                      -                 -      5,347,943              -       5,347,943
     As at 31 December 2010           569,169,300 2,842,811,527         528,918,672               -   3,371,730,199
     Issue of shares                            -             -                   -               -               -

     As at 31 March 2011              569,169,300 2,842,811,527         528,918,672               -   3,371,730,199


19   Legal and treasury share reserve

                                                          Consolidated                    The Company only
                                                       31 March 31 December              31 March 31 December
                                                           2011        2010                  2011          2010
                                                           Baht        Baht                  Baht          Baht
     Opening balance                                  295,431,144       258,225,862    295,431,144     258,225,862
     Appropriation during the period/year               1,954,830        41,038,339      1,954,830      41,038,339
     Increase treasury shares reserve                           -        (3,833,057)             -      (3,833,057)

     Closing balance                                  297,385,974       295,431,144    297,385,974     295,431,144




                                                                                                                  20
Kim Eng Securities (Thailand) Public Company Limited
Unaudited Condensed Notes to the Interim Consolidated and Company Financial Statements
For the three-month periods ended 31 March 2011 and 2010


19   Legal and treasury share reserve (Cont’d)

                                                           Consolidated                     The Company only
                                                        31 March 31 December               31 March 31 December
                                                            2011        2010                   2011          2010
                                                            Baht        Baht                   Baht          Baht
     Legal share reserve                              286,125,001      284,170,171       286,125,001      284,170,171
     Treasury share reserve                            11,260,973       11,260,973        11,260,973       11,260,973

     Total                                            297,385,974      295,431,144       297,385,974      295,431,144

     Under the Public Companies Act B.E. 2535, the company is required to set aside as a legal reserve at least 5%
     of its net income after accumulated deficit (if any) until the reserve is not less than 10% of the registered share
     capital. The reserve is non-distributable as dividends.


20   Warrants


     On 6 December 2005, the shareholders at an Extraordinary General Meeting of Shareholders approved the
     issuance of warrants to purchase the Company’s ordinary shares to its directors and/or staff at the maximum of
     27.25 million units, free of charge. The exercise price of warrant is Baht 7 per share and they are exercisable
     in a ratio of 1 warrant to 1 ordinary share. The exercise date is at the last working day of each month
     throughout the 4 years term of warrants. The first exercisable date will be on 31 August 2006.

     All rights to exercise derivative warrants are expired on 22 February 2010. During the year ended 31 December
     2010, the warrants were exercised by directors and/or staff amounting to 551,200 units. As at 31 December
     2010, the outstanding warrants, which have been allotted but not exercised, are 1,435,500 units.


21   Dividends


     An interim dividend of Baht 1.18 per share amounting to a total of Baht 671.62 million was approved at the
     Annual Shareholder’s Meeting on 30 March 2011. The dividend was paid on 12 April 2011.

     A dividend of Baht 1 per share amounting to a total of Baht 568.61 million was approved at the Annual
     Shareholder’s Meeting on 29 March 2010. The dividend was paid on 12 April 2010.


22   Brokerage fee
                                                           Consolidated                     The Company only
                                                        31 March      31 March             31 March     31 March
                                                            2011          2010                 2011          2010
                                                            Baht          Baht                 Baht          Baht
     Brokerage fee from Securities business           612,216,629      443,604,159       612,216,629      443,604,159
     Brokerage fee from Derivatives business           59,610,008       44,932,890        59,610,008       44,932,890

     Total                                            671,826,637      488,537,049       671,826,637      488,537,049


23   Income taxes


     The interim income tax expense is accrued based on management’s estimate using the tax rate that would be
     applicable to expected total annual earnings. The estimated average annual tax rate used for the year ended
     31 December 2011 is 30% (The estimated tax rate for the three-month period ended 31 March 2010 is 25% for
     the net profit of Baht 300 million and 30% for the net profit exceed Baht 300 million).

                                                                                                                     21
Kim Eng Securities (Thailand) Public Company Limited
Unaudited Condensed Notes to the Interim Consolidated and Company Financial Statements
For the three-month periods ended 31 March 2011 and 2010


24   Reconciliation of dilutive earnings per share

                                                                     Consolidated
                                                      For the three-month period ended 31 March
                                                                    Weighted average
                                         Net earnings           number of ordinary shares    Earnings per share
                                         2011           2010           2011          2010       2011          2010
                                         Baht           Baht         Shares        Shares       Baht          Baht

     Basic earnings per share
     Net profit for the periods     193,332,712   136,330,637   569,169,300   570,557,070        0.34          0.24
     Effect of dilutive potential
      ordinary shares
     Warrants                                 -             -             -      533,767             -            -

     Diluted earnings per share
     Net earnings of ordinary
      shareholders assuming the
      conversion of dilutive
      potential ordinary shares     193,332,712   136,330,637   569,169,300   571,090,837        0.34          0.24

                                                                  The Company only
                                                      For the three-month period ended 31 March
                                                                    Weighted average
                                         Net earnings           number of ordinary shares    Earnings per share
                                         2011           2010           2011          2010       2011          2010
                                         Baht           Baht         Shares        Shares       Baht          Baht

     Basic earnings per share
     Net profit for the periods     198,082,688   140,029,358   569,169,300 570,557,070          0.35          0.25
     Effect of dilutive potential
      ordinary shares
     Warrants                                 -             -             -      533,767             -            -

     Diluted earnings per share
     Net earnings of ordinary
      shareholders assuming the
      conversion of dilutive
      potential ordinary shares     198,082,688   140,029,358   569,169,300 571,090,837          0.35          0.25



25   Employee benefits - Management

                                                          Consolidated                   The Company only
                                                       31 March      31 March           31 March     31 March
                                                           2011          2010               2011          2010
                                                           Baht          Baht               Baht          Baht
     Employee benefits - Management
      - Short-term employee benefits                  51,670,680       38,663,878       51,670,680       38,663,878
      - Post-employment benefits                       1,011,011                -        1,011,011                -




                                                                                                                 22
Kim Eng Securities (Thailand) Public Company Limited
Unaudited Condensed Notes to the Interim Consolidated and Company Financial Statements
For the three-month periods ended 31 March 2011 and 2010


26   Related party transactions


     Information with respect to related parties is as follows:

                                                                                         Nature of relationship
     Kim Eng Holdings Limited                                                                    Parent company
     Mitsubishi UFJ Securities Co., Ltd.                                          Shareholder of parent company
     Kim Eng Securities Pte. Ltd.                                                              Fellow subsidiary
     Kim Eng Securities (Hong Kong) Limited                                                    Fellow subsidiary
     Kim Eng Investment Limited                                                                Fellow subsidiary
     Kim Eng Corporate Finance Pte. Ltd.                                                       Fellow subsidiary
     Kim Eng Securities USA, Inc.                                                              Fellow subsidiary
     Kim Eng Asset Management (Thailand) Co., Ltd.                                                    Subsidiary

     During the three-month periods ended 31 March 2011 and 2010, the Company had significant business
     transactions with subsidiary and related companies, which can be summarised as follows:

                                               Consolidated             The Company only
                                                2011        2010           2011       2010
                                              Million    Million         Million   Million     Transfer price
                                                Baht        Baht           Baht      Baht         policies
     Brokerage fee income
     - Kim Eng Securities Pte.                                                               At minimum rate set
        Ltd.                                         6             24         6         24          by the Stock
                                                                                                      Exchange
     - Kim Eng Securities (Hong                                                                      of Thailand
        Kong) Limited                                1            13          1         13

     Information technology
       service expenses
     - Kim Eng Holdings Limited                      1              1         1          1    At the price agreed
                                                                                             upon by both parties
                                                                                                 referencing the
                                                                                                   market price

     Consulting service fee
     - Kim Eng Corporate
        Finance Pte. Ltd.                            -             2          -          2     At contract price
     - Kim Eng Securities Pte.
        Ltd.                                         1              1         1          1     At contract price

     Reimbursement expenses
     - Mitsubishi UFJ Securities
        Co., Ltd.                                    -              1         -          1       At actual price

     Dividends
     - Kim Eng Holdings Limited                   373             316       373        316
     - Kim Eng Investment
        Limited                                      2              1         2          1

     Rental and Service
     - Kim Eng Asset
        Management (Thailand)                      0.4            0.2       0.4        0.2              At cost
        Company Limited




                                                                                                                23
Kim Eng Securities (Thailand) Public Company Limited
Unaudited Condensed Notes to the Interim Consolidated and Company Financial Statements
For the three-month periods ended 31 March 2011 and 2010


26   Related party transactions (Cont’d)


     The outstanding balances of the above transactions, as presented in the balance sheets are as follows:

                                                          Consolidated                    The Company only
                                                     31 March 31 December               31 March 31 December
                                                           2011         2010                  2011         2010
                                                   Million Baht Million Baht          Million Baht Million Baht
     Securities business receivables
     - Kim Eng Securities Pte. Ltd.                          132                17              132               17
     - Kim Eng Securities (Hong Kong)
       Limited                                                  4                4                4                4

     Other receivables
     - Kim Eng Securities Pte. Ltd.                           0.3              0.3              0.3              0.3
     - Kim Eng Securities USA, Inc.                             -              0.7                -              0.7

     Prepaid consulting fee
     - Kim Eng Securities Pte. Ltd.                             9               10                9               10

     Securities business payables
     - Kim Eng Securities Pte. Ltd.                          166              130               166             130
     - Kim Eng Securities (Hong Kong)
       Limited                                                43                 1               43                1

     Information technology
       service expenses
     - Kim Eng Holdings Limited                                 1                -                1                -

     As at 31 March 2011, the Company has provided loans amounting to Baht 0.2 million (31 December 2010:
     Baht 0.3 million) to employees under the definition of the Securities and Exchange Commission. Interest is
     charged at the rate charged to other employees under the same scheme.

     As at 31 March 2011, the Company invested in a mutual fund which the subsidiary is a fund manager. The
     investment balance is Baht 80,000,000.

     The outstanding contracts with related companies can be summarised as follows:

     On 1 July 2003, the Company signed the information technology service agreement with the parent company
     in Singapore for a period of 1.5 years and has been committed to pay fee at the rate specified in the agreement.
     If no termination is made by either party when due, the agreement is automatically renewed for another year.

     As at 31 March 2011, Kim Eng Holding Ltd. guaranteed the overdraft facilities amounting to Baht
     30 million. There is no outstanding balance as at 31 March 2011.

     On 19 October 2009, the Company has entered into a contract with Kim Eng Securities Pte. Ltd. to provide
     consulting services regarding derivative warrant business. The related services provided include consulting,
     training, transfer knowledge and techniques which regarding to derivative warrants and included the risk
     management control. An agreed profit and loss will be shared. The contract has a continuing service for 5 years
     starting from the contract effective date. The total value of contract is USD 1 million. The contract has been
     approved by Board of Directors Meeting No.4/2009 on 13 August 2009. Later, the Company revised the
     service fee by diminishing it amounting to USD 0.5 million. The profit and loss is not shared. The revision
     contract was dated 12 August 2010.

     The Company and its subsidiary entered into a rental agreement for office and services since 31 December
     2010. The contract expiration is on 23 December 2013.



                                                                                                                  24
Kim Eng Securities (Thailand) Public Company Limited
Unaudited Condensed Notes to the Interim Consolidated and Company Financial Statements
For the three-month periods ended 31 March 2011 and 2010


27   Commitment


     The Group entered into the long-term lease agreements for office and services. The future aggregate minimum
     lease payments under these agreements are as follows:

                                                      Consolidated                    The Company only
                                                 31 March      31 December          31 March    31 December
                                                       2011            2010               2011          2010
                                               Million Baht    Million Baht       Million Baht  Million Baht
     No later than 1 year                                75                79               74                78
     Later than 1 year but not later than
      2 years                                            51                55               50                54
     Later than 2 years                                  32                43               31                42

     Total                                              158               177              155               174


28   Business/geographical segment information


     The Company’s operation involves mainly in Securities and derivatives brokering and service provision and is
     operated only in Thailand, accordingly, no business/geographical area segment information is presented.


29   Contingent liabilities


     As at 31 March 2011, the Company has no outstanding borrowing stocks through securities borrowing and
     lending business from an asset management company (31 December 2010: Baht 19,167,500). These stocks
     were borrowed from that asset management company, lent to and returned from Company’s customers.
     However, these outstanding stocks were during the process of returning to such asset management company.




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