SBI Annual Report 09 10

SBI Global Factors Ltd.
Contents Contents
List of Directors Board of Directors Directors Report Corporate Governance Report Management Discussion and Analysis Auditors Report Report of Comptroller & Auditor General of India Balance Sheet Profit and Loss Account Cash Flow Statement Schedules To Balance Sheet and Profit And Loss Account Balance Sheet in US $ Profit and Loss Account in US $ Market Share Events 2 3 5 11 14 16 20 22 23 24 25 54 55 58 59
SBIGFL
Annual Report 2009-2010
List of Directors List Director ectors

Name Shri. O. P. Bhatt Shri. R. Sridharan Smt. Bharati Rao Shri V. Kannan Shri. B.K.Vatsaraj Shri. Y. Vijayanand Smt. Bhama Krishnamurthy Shri. S. Rajendran Shri. Ashwin Ankhad Shri Sangeet Shukla Designation Chairman Director Director Director Independent Director Independent Director * Director* Director * Independent Director* Executive Vice-Chairman & C.E.O.
* as on 10th June 2010
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Board of Directors Board Director ectors
Shri O.P. Bhatt Chairman
Shri R. Sridharan Director
Smt. Bharati Rao Director
Shri V. Kannan Director
Shri B.K. Vatsaraj Director
Shri Y. Vijayanand Director

(From 10th June, 2010)
Smt. Bhama Krishnamurthy Director

Shri S. Rajendran Director

Shri Ashwin Ankhad Director

Shri Sangeet Shukla (Executive Vice Chairman & C.E.O.)
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Bankers State Bank of India Axis Bank HDFC Bank Standard Chartered Bank Auditors Contractor Nayak & Kisnadwala Chartered Accountants Jash Chambers, 3rd Floor, 7A, Sir P.M.Road, Fort, Mumbai 400001 Solicitors K Ashar & Company Meadows House, 4th & 5 th Floor, 39, Nagindas Master Road, Fort, Mumbai 400023 Paras Kuhad & Associates 903, Peninsula Towers, Peninsula Corporate Park, Ganpatrao Kadam Marg, Lower Parel, Mumbai 400013 Registered Office 6 Floor, The Metropolitan, BandraKurla Complex, Bandra (East), Mumbai - 400051
th
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Directors Report Director ectors

For the Financial Year Ended March 31, 2010
Your Directors have a pleasure in presenting the ninth Annual Report of SBI Global Factors Limited (formerly Global Trade Finance Limited) along with the audited Balance Sheet as at March 31, 2010 and Profit and Loss Account for the year ended on that date.
Financial Performance
(i) During the year, the Company recorded a total turnover of Rs 129.78 billion (US $ 2.89 billion), export turnover of Rs 11.42 billion (US $ 0.25 billion), import turnover of Rs 0.38 billion (US $ 8.46 million) and domestic turnover of Rs 117.98 billion (US $ 2.63 billion). As at March 31, 2010, the Company had advances outstanding of Rs 30,298 million (US $ 674.79 million), of which the export outstandings stood at Rs 1,955 million (US $ 43.54 million), import outstandings at Rs 99 million (US $ 2.20 million) and domestic outstandings at Rs 28,244 million (US $ 629.04 million). Gross NPAs stand at Rs 6,352 million (US $ 141.47 million) and Net NPAs stand at Rs 5,068 million (US $ 112.87 million). The amount to be transferred to Reserve Fund is Rs 13.16 million (US $ 0.29 million).
Summary of Financial Results

2009-10 (in Rs. Mn.) 1,29,781 1,17,977 11,804 30,294 4,931 108 66 2008-09* (in Rs. Mn.) 1,82,825 1,55,562 27,263 45,139 6,765 1,850 1,219 Year-over-Year Growth (%) (29.01) (24.16) (56.70) (32.88) (27.11) (94.16) (94.59)
Total Turnover Domestic Turnover International Turnover Advances Outstanding Total Income Profit Before Tax Profit After Tax
* (includes figures of SBI Factors and Commercial Services Private Limited for the Year 200809, since merged with the Company) (ii) The Company recorded a total income of Rs 4,931 million (US $109.82 million)*, posted a profit before tax of Rs 108 million (US $ 2.41 million) during the current year against a total income of Rs 6,765 million (US $ 133.28 million) ** and a profit before tax of Rs 1,850 million (US $ 36.47 million) reported in the previous year. * 1US$ = Rs. 44.90 ** 1US$ = Rs. 50.72
Changes And Developments

During the Financial Year, pursuant to the Scheme of Amalgamation of SBI Factors and Commercial Services Private Limited (SBIF) with Global Trade Finance Limited, sanctioned by the Honble High Court, Bombay vide its Order dated January 15, 2010 : (i) The Registrar of Companies, Maharashtra, issued a Fresh Certificate of Incorporation consequent upon Change of Name on March 18, 2010, approving change of the Companys name from Global Trade Finance Limited to SBI Global Factors Limited (SBIGFL). Reserve Bank of India, issued a new NBFC Certificate of Registration dated March 23, 2010 in the name of the Merged Entity viz., SBI Global Factors Limited.
(ii)
(iii) From the Appointed Date of the Merger, all the Assets, Properties, Debts, Liabilities (including Contingent Liabilities) of erstwhile SBI Factors and Commercial Services Private Limited have been transferred to SBIGFL.
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International Associations
SBI Global Factors Limited (formerly Global Trade Finance Limited) is a member of Factors Chain International (FCI), an umbrella Organisation of worldwide Factoring Companies. FCI is a global network of leading Factoring Companies with a common aim to facilitate international trade through factoring and related financial services. Currently, the FCI network counts 247 Factors in 66 countries, actively engaged in more than half of the worlds cross-border factoring volume.
Human Resources
All permanent Employees of erstwhile SBIF have become permanent Employees of SBIGFL. SBIGFL is a professionally managed Company that constantly innovates and tries to adopt global best practices in this field. Alignment with the long-term business direction and co-creation of shared values help each individual meet the Companys objectives. The Company believes in investing in people to develop and expand their skill-sets. During the year, (i) (ii) Shri Sangeet Shukla took over as the Executive Vice Chairman & C.E.O. in November, 2009. Shri K.S. Subramanian has joined as Executive Vice President of the Merged Entity.
Post merger, the staff strength of SBIGFL is 164, including 27 employees on deputation from SBI. M/s. Ernst & Young (P) Ltd. have been appointed as a Consultant to look into HR integration process.
Information Technology
In order to bring operations of both the merged Companies on to a common IT platform, the following activities have been undertaken : 1. Domain name change for e-communication :Global Trade Finance Ltd and SBI Factors and Commercial Services Pvt. Ltd. were using two different domains sbifactors.com and gtfindia.com for e-mail facility. Post merger, new email domain sbiglobal.in has been registered and e-mail ids of all the users of the merged entity have been created with access to their old/ archive mails globally over the internet. 2. Domain name changed for the web-site:A New domain, www.sbiglobal.in for the website has been registered and restructuring of the web-site is under process. 3. Change of factoring software:A Technical Evaluation Committee was formed to oversee the system related aspects of the merger. It was decided to purchase a factoring software Trade Free Solutions, which is an upgraded version of the software Octopus used by GTF. SBIF database has been migrated to TradeFree which was commissioned on 1st April 2010. Testing of seamless transfer of data from TradeFree to the accounting platform has been completed. 4 Network:The combined entity has migrated to the SBI Connect for accessing and transfer of data through Intranet.
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Credit Rating
During the year, various Rating Agencies have assigned the ratings to GTF and SBIGFL (post merger) for its funding requirements as given below : Rating Agency ICRA ICRA ICRA ICRA ICRA CRISIL CRISIL Rating A1+ A1+ LAAA with a stable outlook LAAA with a stable outlook LAAA with a stable outlook P1+ AAA/Stable Amount in Rs. Crore 3550 3276 100 Particulars Short Term Debt Program Short Term Bank Facilities Non-Convertible Debenture Program Non-Convertible Debenture Program Redeemable Preference Shares Short Term Debt Program Long Term Non-Convertible Debentures Redeemable Long Term Preference Shares
30 50 2000 100
CRISIL
AAA/Stable
50
The ratings indicate the highest degree of safety with regard to timely payment of interest and principal on the rated instruments. SBIGFL continues to augment resources from competitive sources and during the year under review, it has raised Rupee resources by borrowing through debt instruments like Commercial Papers, NCDs, short-term credit facilities from leading commercial banks and money market instruments. It has tapped Foreign Currency lines from various domestic and international banks at competitive interest rates.
NPA Management
Due to economic downturn, accounts of a number of clients of the Company have become Non Performing. In some cases, irregularities such as fake invoices and undervaluation of securities were also noticed. The Company has classified these accounts as frauds and reported these cases for criminal investigation. The Company has adequately provided for these NPAs in its books out of the Current Years profits. The Company has NPAs aggregating Rs. 6352 Mn. in 83 accounts with provision of Rs. 1284 Mn. as on March 31, 2010. Further, 18 accounts with outstanding of Rs. 1849 Mn. have been technically written off with legal and recovery action continued. Taking into account a carry forward provision of Rs. 664 Mn. from the previous year, total provision for NPAs made out of current years profits comes to Rs. 2469 Mn. The Company has put a focus on the recovery of NPAs. The efforts have already started paying dividends.
Dividend
In view of substantial provision for NPAs made during the year as explained above, the Company has posted Profit after Tax of Rs. 66 Mn. for the year ended March 31, 2010 as against Rs. 1,219 Mn. during the previous Financial Year. In view of the above, the Directors do not propose payment of
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Dividend to the Equity Shareholders for the Financial Year ended March 31, 2010. However, a Dividend on Preference Share Capital (Rs. 100 Mn.) at the rate of 9.5 % is being recommended to the Shareholders for approval.
Share Capital
As per the Scheme of Amalgamation of SBI Factors and Commercial Services Private Limited with Global Trade Finance Limited, the Shareholders of the Company at their Extraordinary General Meeting held on February 19, 2010, approved increase in the Authorized Share Capital of the Company from Rs. 2,000,000,000 (Rupees Two Billion Only) divided into 120,000,000 (One Hundred Twenty Million) Equity Shares of Rs. 10/- each and 80,000,000 (Eighty Million) Preference Shares of Rs. 10/- each to Rs. 3,000,000,000 (Rupees Three Billion) divided into 180,000,000 (One Hundred Eighty Million) Equity shares of Rs.10/- each and 120,000,000 (One Hundred Twenty Million) Preference shares of Rs.10/each. Subsequently, on March 26, 2010, 4,71,17,510 Equity Shares of the Company were issued/ allotted to the Equity Shareholders of erstwhile SBI Factors and Commercial Services Private Limited (since merged with the Company) as on February 11, 2010 (i.e. Record Date), in the proportion of 100 (One Hundred) fully paid Equity Shares of Rs. 10/- (Rupees Ten) each in the Company for every 111 (One Hundred and Eleven) Equity Shares of Rs. 10/- (Rupees Ten) each held in SBI Factors and Commercial Services Private Limited (viz. 3,01,55,207 Equity Shares to State Bank of India, 28,27,050 Equity Shares to State Bank of Indore, 47,11,751 Equity Shares to Union Bank of India, and 94,23,502 Equity Shares to Small Industries Development Bank of India (SIDBI)). Consequently, the Equity Shareholding Pattern of the Merged Entity as on March 31, 2010 is as under:
Name of the Shareholder
Nos. of Equity Shares held in Global Trade Finance Limited (a) 90,199,998 Nil Nil Nil 69,42,857 9,71,42,855
% of pre Nos. of new merger paid Equity shares up issued in Equity Shares the Merged Capital held Entity (b) 92.85 Nil Nil Nil 7.15 100.00
Total % of post merger paid up Equity Capital (c=a+b) held 83.43 1.96 3.27 6.53 4.81 100.00
State Bank of India State Bank of Indore Union Bank of India SIDBI Bank of Maharashtra TOTAL
3,01,55,207 12,03,55,205 28,27,050 28,27,050 47,11,751 47,11,751 94,23,502 94,23,502 Nil 69,42,857 4,71,17,510 14,42,60,365
Conservation of Energy, Technology Absorption & Foreign Exchange Earnings & Outgoings
Information required to be provided under Section 217(1)(e) of the Companies Act, 1956 read with the Companies (Disclosure of particulars in the Report of the Board of Directors) Rules, 1988 in relation to the Conservation of Energy and Technological Absorption is not applicable to the Company. Particulars of foreign currency earnings and outgo during the year are given in Schedule 17 to the Notes to the Accounts forming part of the Annual Accounts.
Internal Audit and Limited Review of Quarterly Accounts

SBIGFL has appointed an independent firm of Chartered Accountants, M/s., M.P. Chitale & Co., as Internal and Concurrent Auditors. Internal Audit & Compliance is focused on independently evaluating the adequacy of internal controls, ensuring adherence to operating guidelines and regulatory and legal requirements and pro-actively recommending improvements in operational
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processes and service quality. The half yearly results are also subjected to a limited review by the Statutory Auditors.
Particulars of Employees
Any Shareholder interested in obtaining a copy of the Statement of Particulars of Employees may write to the Company Secretary of the Company to obtain the same.
Corporate Governance Report

The report on Corporate Governance is appended herewith.
Management Discussions & Analysis Report

Annual Report has a separate Chapter on Management Discussions and Analysis.
Directors
The Board of Directors of the Company at present consists of eight Directors. During the Financial Year ended on 31 st March, 2010, (i) Consequent upon transfer of Shri R. Venkatachalam, CGM (MCG), SBI, as nominated by SBI, Smt. Bharati Rao, the then Advisor (Mergers & Acquisitions), SBI, was appointed as an Additional Director of the Company with effect from July 03, 2009, in place of Shri R. Venkatachalam.
(ii) Shri Sangeet Shukla, Dy. Managing Director, State Bank of India, has joined the Board as Executive Vice Chairman & C.E.O. with effect from November 06, 2009, in terms of his nomination by the Chairman of State Bank of India. (iii) Shri Arvind Sonmale was re-designated as Managing Director as against his earlier designation as Managing Director & C.E.O. of the Company with effect from November 6, 2009. (iv) Consequent upon retirement, Shri V.K. Gupta relinquished the Office of the Joint Managing Director of the Company on March 31, 2010.
Public Deposits
During the Financial Year ended March 31, 2010, the Company has not accepted any deposits from the public within the meaning of the provisions of the Non-Banking Financial Companies (Reserve Bank) Directions, 1998.
Auditors
M/s. Contractor, Nayak & Kishnadwala, Chartered Accountants, the present Statutory Auditors of the Company appointed by the Comptroller & Auditor General of India (C&AG of India), will retire at the close of the 9th Annual General Meeting of the Company. Consequent upon merger of SBI Factors and Commercial Services Private Limited with Global Trade Finance Limited with effect from April 01, 2009 (i.e. the Appointed Date), they have conducted the Audit of the merged Entity for FY 2009-10 with the approval of C&AG of India. The Statutory Auditors of the Company for the Financial Year 2010-11 would be appointed as and when and as may be directed/ informed to the Company by the C&AG, pursuant to Section 619 and other applicable provisions of the Companies Act, 1956.
Comments of the Comptroller and Auditor General of India Under Section 619(4) of the Companies Act, 1956 on the Accounts of the Company for the Financial Year ended March 31, 2010
The Comptroller and Auditor General of India (C&AG of India), on conducting a Supplementary Audit under Section 619 (3)(b) of the Companies Act, 1956, of the Financial Statements of the
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Company for the Financial Year ended 31 st March, 2010, have commented that nothing significant has come to their knowledge which would give rise to any comment upon or supplement to Statutory Auditors Report under Section 619(4) of the Companies Act, 1956.
Directors Responsibility Statement

Pursuant to Section 217(2AA) of the Companies Act, 1956, your Directors confirm that: a) b) in the preparation of the annual accounts, the applicable accounting standards have been duly followed; the Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit or loss of the Company for that period; the Directors have taken proper and sufficient care for the maintenance of adequate records in accordance with the provisions of the Companies Act, 1956 for safeguarding the assets of the Company and for preventing and detecting frauds and other irregularities; the Directors have prepared the annual accounts on a going concern basis.
c)
d)
Acknowledgements
The Directors thank the Shareholding Banks/Financial Institutions and the Reserve Bank of India, for their continued support. They are thankful to the Clients and Customers for their continued patronage. The Directors wish to acknowledge the support of SBI in lending the services of their experienced Executives/ Managers to the Company. The Directors also wish to convey their appreciation to employees at all levels for their hard work, dedication and commitment.
For and on behalf of the Board of Directors Place : Mumbai Date : 27/04/2010 O.P. Bhatt Chairman
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Corporate Governance Report Corporate

1. Board of Directors (Board)
At the core of our Corporate Governance practice is the Board, which oversees how the management serves and protects the long-term interests of all the Stakeholders and the Shareholders of the Company. We believe that an active, well-informed and independent Board is necessary to ensure the highest standards of Corporate Governance. The Board is independent of the Companys Management. At the end of Financial Year 2009-10, the Board comprised of nine (9) members, which consisted of four (4) Non-Executive Directors, two (2) Independent Directors, and three (3) full-time Executive Directors. The Board of Directors meets, as often as necessary, in addition to meeting on a quarterly basis to review the performance and give future directions to the Senior Management Team of the Company. The particulars of Directors, their attendance during the financial year 2009 2010 and also other Directorships are as under: Name and Designation of Director Category of Director No. of Board Meetings Attended 5 6 No. of Directorships in other companies 10* 8*
Shri O. P. Bhatt Chairman Shri R. Sridharan Director Shri Sangeet Shukla Additional Director (Executive Vice Chairman & C.E.O.) Shri V. K. Gupta Jt. Managing Director Smt. Bharati Rao Director Shri R. Venkatachalam Director Shri M. G. Bhide Director Shri B.K. Vatsaraj Director Shri V. Kannan Director Shri Arvind Sonmale Managing Director
Non-Executive Non-Executive
Full-time Executive (Since 06/11/2009) Full-time Executive (upto 31/03/2010) Non-Executive (Since 03/07/2009) Non-Executive (upto 02/07/2009) Independent Non Executive Independent Non- Executive Non Executive Full-time Executive
6 4
4**
1 5 4 3 6
8 1 1
* Excluding Banks, Foreign Companies, Corporations etc. ** Excluding a Foreign Company Meetings of the Board During the Financial Year ended on 31st March, 2010, 6 (six) Board Meetings were held on April 28, 2009, July 18, 2009, October 09, 2009, October 26, 2009, January 19, 2010 and February 19, 2010.
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2. Audit Committee
Upon the induction of Shri B.K. Vatsaraj as a Member of the Audit Committee of the Board of Directors w.e.f. April 28, 2009, the Audit Committee, at present, comprises five Members of which, three are Non Executive Directors and two are Independent Directors. Members of the Audit Committee are as follows: 1. Shri M.G. Bhide Chairman 2. Shri R. Sridharan Member 3. Smt. Bharati Rao Member 4. Shri V. Kannan Member 5. Shri B.K. Vatsaraj Member During the Financial Year ended on March 31, 2010, the Audit Committee met 4 times viz: on 25/04/2009, 18/07/2009, 22/10/2009, and 19/01/2010. The attendance of the Audit Committee Members at such meetings is as stated below: Name of the Member Shri M.G. Bhide Shri R. Sridharan Shri R.Venkatachalam* Smt. Bharati Rao** Shri V. Kannan Shri B.K. Vatsaraj *** No. of Audit Committee Meetings attended 4 4 1 3 3 3
* Director upto : 02/07/2009 ** Date of appointment : 03/07/2009 *** Date of appointment : 28/04/2009 In addition, the Statutory Auditors and Internal Auditors attend and participate in the deliberations at the meetings of the Audit Committee.
3.
Executive Committee of the Board:

The Company has an Executive Committee of the Board which, inter alia, approves the Credit proposals beyond a certain limit, and also directs the Senior Management Team of the Company. It supplements the right insight and business perspective in order to aid the Companys Management in achieving its goals and mission. During the year, a. b. With effect from July 03, 2009, Smt. Bharati Rao was appointed as a Member of the Executive Committee of the Board of Directors, in place of Shri Venkatachalam. With effect from November 06, 2009, Shri Sangeet Shukla, Executive Vice Chairman & C.E.O. of the Company, was appointed as Member of the Executive Committee of the Board, With effect from March 19, 2010, Shri B.K. Vatsaraj was appointed as Member of the Executive Committee of the Board. Upon retirement, Shri V.K. Gupta relinquished the Office of the Joint Managing Director of the Company on March 31, 2010. Accordingly, he ceased to be a Member of the Executive Committee of the Board.
c. d.
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The Executive Committee of the Board at present consists of the following Members : 1. 2. 3. 4. 5. Shri Sangeet Shukla (Executive Vice Chairman & C.E.O.) (Member), Smt. Bharati Rao (Member), Shri V. Kannan (Member), Shri B.K. Vatsaraj (Member), and Shri Arvind Sonmale, Managing Director (Member)
4.
General Body Meetings:
Particulars of the last three Annual General Meetings (AGMs) of the Company: AGM Sixth Financial Year 2006-2007 Date of the AGM 04/05/07 Time 10.00 a.m. Venue 6th Floor, The Metropolitan, Bandra Kurla Complex, Bandra (East), Mumbai 400 051 State Bank Bhavan, Corporate Centre, 18th Floor, Madame Cama Road, Nariman Point, Mumbai 400 021 State Bank Bhavan, Corporate Centre, 18th Floor, Madame Cama Road, Nariman Point, Mumbai 400 021
Seventh
2007-2008
21/04/08
12.30 p.m.
Eighth
2008-2009
18/07/09
04.30 p.m.
The following Special Resolutions were passed at the above AGMs : AGM Sixth DETAILS OF THE SPECIAL RESOLUTION (1) Re-appointment of M/s. Deloitte, Haskins & Sells, Chartered Accountants as Statutory Auditors (2) Re-classification of the Companys Authorised Share Capital from 200,000,000 Shares (Rs. 2,000,000,000/-) divided into 164,000,000 Equity Shares of Rs. 10/each and 36,000,000 Preference Shares of Rs. 10/- each to 200,000,000 Shares (Rs. 2,000,000,000) divided into 150,000,000 Equity Shares of Rs. 10/- each and 50,000,000 Preference Shares of Rs. 10/- each, (3) Appointment of Managing Director & C.E.O., (4) Further issue of 65,000,000 Equity Shares of Rs. 10/- each of the Company, (5) Further issue of 26,500,000 Non-Convertible Redeemable Preference Shares of Rs. 10/- each of the Company (1) Further issue of 66,66,666 Equity Shares of Rs. 10/- each at a premium of Rs. 65per Share, (2) Extension of term of appointment of Managing Director & C.E.O. previously approved by the Board of Directors. (1) Appointment of Statutory Auditors for the Financial Year 2009-10, as directed by the Comptroller & Auditor General of India, (2) Extension of term of appointment of Managing Director & C.E.O., previously approved by the Board of Directors
Seventh
Eighth
5.
General Shareholder Information:

Financial Year Registrar and Transfer Agents Address for correspondence April 01, 2009 to March 31, 2010 Datamatics Financial Services Limited 6th Floor, The Metropolitan Bandra-Kurla Complex, Bandra (East)Mumbai 400 051
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Management Discussion and Analysis Discussion scuss Analys

Global Economic Scenario:
Past two years were the most volatile years for the world economy since great depression of 1929. Though the domestic economies of India and China were relatively less impacted, their exports substantially declined as a result of global recession. However, with the sign of revival in the global economy specially the US economy from the third quarter of the year (Fourth quarter GDP growth of 5.6%), the growth has started showing signs of pick up. Although the outlook for the current and the coming quarters may be marginally better than that of the previous year, the recent turbulence due to poor fiscal discipline of some of the European countries has unsettled the Euro and drawn attention to the divergence in growth potential and fiscal health of various countries in Europe and as a result, the confidence is impacted.
Indian Economic Scenario: Resilience of the Indian Economy

India faced the financial crisis better than the West. Various measures like soft interest rates and reduced excise and service taxes were brought in as a part of the stimulus package. These have helped the economy to post more than 7% growth in 2009-10. The stimulus has helped exports and manufacturing to grow after months of decline. The Index of Industrial Production (IIP) rose by 16.7% in January and 15.10% in February 2010. In 2010-11 economic growth is projected at 8%+. The sales of the Corporate India grew by 13.4% in December 2009 and 4.7% for the year. Sectors like automobiles, auto ancillaries, tyre and textiles have benefitted from the pickup in the demand. The resilient economy could absorb the impact of the weakest monsoon since 1972. However, the stimulus packages while sustaining growth have triggered the inflationary pressures and the inflation is now a matter of concern. Oil prices have started increasing and crossed the USD90 per barrel and are a major cause of concern. WPI rose by 9.9% in March 2010. To tame the inflation, RBI has initiated measures in its annual policy and announced hike in CRR and also raised the key rates.
Interest Rate Scenario:

Interest rates remained stable during the year due to the stimulus package and easy liquidity. The rates are likely to harden as the RBI takes measures to suck a part of the liquidity out of the system and pick up in the credit expected in the second quarter. The Company is engaged in financing of short term receivables and is subject to Rate Risk due to volatility in rates in the short term. To mitigate this risk the Company matches the maturity profile of its assets with short term funding options.
Merger of SBIF with GTF:

The process of merger of SBI Factors & Commercial Services Pvt. Ltd., with the Company initiated last year has been completed successfully during the year under the order of the Honble Bombay High Court with effect from 11th February 2010. The merged company has been named as SBI Global Factors Ltd with effect from 23 rd March 2010. The new entity commands 85% market share. The SBIGFL has now 17 branches in strategic locations in India. The combined entity enjoys highest ratings of A1+ & LAAA (Stable) from ICRA and CARE respectively for its short and long terms borrowings. The new Company has adopted a new logo. The new logo while preserving the brand recall of both the Companies symbolizes the synergy between the two Companies and the lineage of the merged entity. The Company has appointed leading consultant Ernst & Young to prepare a new HR policy. Both the merged Companies operated on different software platforms developed by different vendors. For the merged entity, a new software has been commissioned and developed, which has since been successfully implemented in the Company.
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Outlook for the Factoring Services:

The factoring services were launched in India in 1991 by SBI by promoting SBI Factors & Commercial Services Pvt. Ltd. In the last 19 years many Factoring companies entered the market and also shut their shops. However, the contribution of factoring products in meeting the total working capital requirement of the companies in India is less than 0.50%. As per the reports of Factors Chain International, an umbrella organization of factoring companies world-wide, in last 8 years the factoring turnover in China grew from 2,640 Mi EUR to 67,300 Mi EUR. In comparison, the turnover in India increased from 1615 Mi EUR to 2650 Mi EUR. Despite the growth in Indian Factoring in last five years at more than 60% compared to the worldwide growth of 50% in the same period, the share of Indian Factoring is less than 1% of the total volumes generated in the world. The reasons for the slow growth are several like inadequacies in the legal framework and ad valorem stamp duty on the assignment of debts. A comprehensive legislation to address the legal hurdles affecting the growth of the factoring industry is under consideration of Government of India. In spite of these impediments factoring products have gained popularity with the SMEs more particularly auto ancillary industry, component manufacturers for engineering companies etc. A number of such units are dealing satisfactorily with us and with revival of economy and auto industries in particular, the factoring can record a good growth in near future.
Performance of the Company:

Due to economic downturn the accounts of a number of clients of the Company have become nonperforming. In some client accounts, irregularities such as fake invoices and under valuation of securities were also noticed. The Company has classified these accounts as frauds and reported these for criminal investigation. The Company has adequately provided for these NPAs in its books out of current years profits, which has affected its profits for the year. The Company has put a focus on the recovery of the NPA. The efforts have already started yielding dividend.
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Auditors Auditors Report

To, The Board of Directors, SBI GLOBAL FACTORS LIMITED
(Formerly Known as GLOBAL TRADE FINANCE LIMITED)
Mumbai. We have audited the accounts of SBI GLOBAL FACTORS LIMITED (formerly known as GLOBAL TRADE FINANCE LIMITED) for the year ended 31st March, 2010. As required by the Non Banking financial Companies Auditors Report (Reserve Bank) Directions, 2008 dated 18th September 2008, we give below our report on the matters specified in the above mentioned directions and state that: 1. The Company is engaged in the business of non-banking financial Institution and has obtained a Certificate of Registration (N-13.01518) on the 28th April 2001 from Reserve Bank of India The company is entitled to continue to hold such Certificate of Registration in terms of its assest / income pattern as on 31st March, 2010 The Board of Directors had passed a resolution for non acceptance of any public deposit in their meeting held on 28th April, 2009 The Company has not accepted any public deposits during the relevant year 2009-2010. The Company has complied with the prudential norms relating to Income Recognition, accounting standards, asset classification and provisioning for the bad and doubtful debts as specified to it in terms of Non-Banking Financial (Non Deposit Accepting or Holding) Companies Prudential Norms (Reserve Bank) Directions, 2007. The capital adequacy ratio as disclosed in the return submitted to the Bank on 10th June, 2009, In Form NBS-7, has been correctly arrived at and such ratio is in compliance with the minimum CRAR prescribed by the Reserve Bank of India; The company has furnished to the Reserve Bank of India the annual statement of capital funds risk assets/exposures and risk asset ratio (NBS-7) on 10th June, 2009, within the stipulated period.
2.
3.
4. 5.
6.
7.
For Contractor, Nayak & KIshnadwala Chartered Accountants
(G.S. Nayak) Partner M.No. 38127 Firm Registration No.101961 W Place: Mumbai Date: 27th April, 2010
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Auditors Report Auditors

To The Members, SBI Global Factors Limited (formerly known as Global Trade Finance Limited) We have audited the attached Balance Sheet of SBI Global Factors Limited (formerly known as Global Trade Finance Limited) (the Company), as at 31st March 2010 and also the Profit and Loss Account and the Cash Flow Statement for the year ended on that date, including the accounts of erstwhile SBI Factors and Commercial Services Private Limited for the year ended 31st March 2010 consequent to its amalgamation with the Company with effect from 1st April 2009, annexed thereto. These financial statements are the responsibility of the Companys management. Our responsibility is to express an opinion on these financial statements based on our audit. We have conducted our audit in accordance with auditing standards generally accepted in India. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. Audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. Audit also includes assessing the accounting principles used and significant estimates made by management as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion. We report that: 1. We have obtained all the information and explanations, which to the best of our knowledge and belief were necessary for the purposes of our audit; 2. In our opinion, proper books of account, as required by law, have been kept by the company in so far as appears from our examination of those books; 3. The Balance Sheet, Profit and Loss Account and Cash Flow Statement dealt with by this report are in agreement with the books of account; 4. In our opinion, the Balance Sheet, Profit and Loss Account and Cash Flow Statement dealt with by this report comply with the Mandatory Accounting Standards referred to in sub-section (3C) of section 211 of the Companies Act, 1956; 5. On the basis of written representations received from directors as on 31st March 2010, and taken on record by the Board of Directors, we report that none of the directors is disqualified as on 31st March, 2010 from being appointed as a director in terms of clause (g) of sub-section (1) of section 274 of the Companies Act, 1956; 6. In our opinion and to the best of our information and according to the explanations given to us, the said accounts read together with notes forming part of it, give the information required by the Companies Act, 1956, in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India; a) In the case of the Balance Sheet, of the state of affairs of the Company as at 31st March, 2010, and b) In the case of the Profit and Loss Account, of the profit for the year ended on that date. c) In the case of Cash Flow Statement, of the cash flows for the year ended on that date. 7. As required by the Companies (Auditors Report) Order, 2003, as amended by the Companies (Auditors Report) (Amendment) Order, 2004 issued by the Central Government of India in terms of sub-section (4A) of section 227 of the Companies Act, 1956 and according to the information and explanations given to us during the course of the audit and on the basis of such checks as were considered appropriate, we report that: The Company is engaged in the business of factoring of debts/receivables and the requirements of clauses (ii), (viii) and (xiii) of paragraph 4 of the order are not applicable to the company.
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i) (a) (b)
The Company has maintained proper records showing full particulars including quantitative details and situation of the fixed assets; As per the information and explanations given to us, the management has carried out the physical verification of some of the fixed assets during the year, in accordance with a program of verification, which in our opinion provides physical verification of all assets at reasonable intervals. The discrepancies noticed on such verification, which were not material, have been appropriately dealt with in the accounts. The Company has not disposed of significant part of fixed assets during the year and the question of effect on the going concern of the Company does not arise. As per the information and explanations given to us, the Company has not granted nor taken unsecured loans to/from Companies, firms or other parties covered in the register maintained under section 301 of the Companies Act, 1956. Hence sub clauses (b), (c), (d), (e), (f) & (g) are not applicable to the Company. In our opinion and according to the information and explanations given to us, there are adequate internal control procedures commensurate with the size of the Company and the nature of its business with regard to purchase of fixed assets and sale of services. There are no transactions of purchase of inventory and for sale of goods. During the course of our audit, no major weakness has been noticed in the internal control system and there is no continuing failure for the same. In our opinion and according to the information and explanations given to us, there are no contracts or arrangements referred to in Section 301 of the Companies Act, 1956. Accordingly the provisions of the clause (v) of the Companies (Auditors Report) Order, 2003 are not applicable to the Company. The Company has not accepted deposits from the public and therefore the question of compliance with the provisions of Section 58A and 58AA or any other relevant provisions of the Companies Act, 1956 and rules made thereunder for the deposits accepted from the public does not arise. In our opinion, the Company generally has an internal audit system commensurate with the size and nature of its business.
(c) ii) (a)
iii)
iv)
v)
vi)
vii) (a) According to the information and explanations given to us and the records examined by us, the Company is regular in depositing with appropriate authorities undisputed statutory dues including provident fund, investors education and protection fund, or employees state insurance, income tax, sales tax, wealth tax, excise duty, custom duty, service tax, cess and other statutory dues applicable to it and there are no undisputed statutory dues outstanding as at 31st March 2010, for a period of more than six months from the date they became payable. (b) According to the information and explanation given to us, there are no dues of sales tax, customs duty, excise duty, wealth tax and cess which have not been deposited on account of any dispute. According to the information and explanation given to us, the details of Income tax and service tax dues which have not been deposited on account of disputes are as follows: Name of the Statute Amount Rs. Period for which the amount relates Forum where dispute is pending
In case of the company: Income Tax Act, 1961 500,000 FY 2002-03 Income Tax Appellate Tribunal Income Tax Act, 1961 8,455,754 FY 2003-04 Commissioner of Income Tax (Appeals) Income Tax Act, 1961 19,402,183 FY 2004-05 Commissioner of Income Tax (Appeals) Income Tax Act, 1961 13,254,175 FY 2006-07 Commissioner of Income Tax (Appeals) Service Tax under 10,157,247 2004-2009 Commissioner of Excise & Finance Act 1994 Service Tax (Appeals) In case of erstwhile SBI Factors and Commercial Services Pvt. Ltd. Income Tax Act, 1961 8,186,253 FY 2004-05 Commissioner of Income Tax (Appeals) Income Tax Act, 1961 3,163,485 FY 2007-08 Commissioner of Income Tax (Appeals)
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viii)
The company has no accumulated losses as on 31st March 2010 and no cash losses in the immediately preceding financial year. The Company has not incurred any cash loss during the financial year. Based on the information and explanations given to us, the Company has not defaulted in the repayment of dues to financial institutions or banks or debenture holders. Based on our examination of the records and the information and explanations given to us, the Company has maintained adequate documents and records where the Company has granted any loans and/or advances on the basis of security by way of pledge of shares, debentures and other securities. Based on the information and explanation provided to us, on our examination of the records and documents and our evaluation of the related internal controls, the Company has maintained proper records and timely entries are being made in respect of its dealing in units of mutual funds. All investments including units of mutual funds and bonds have been held by the Company in its own name. There are no transactions in shares or other investments. According to the information and explanations given to us, the Company has not given any guarantees for loans taken by others from banks or financial institutions other than credit protection in the case of import factoring and guarantee to banks for letters of credit issued by banks for the Company's clients, the terms and conditions of which are not prejudicial to the interest of the company. In our opinion and according to the information and explanations given to us, the funds raised through term loans have been applied for the purpose for which they were obtained. According to the information and explanations given to us and on an overall examination of the balance sheet of the Company, we report that funds raised for short-term basis during the year have been prima facie not utilised for long term investment. According to the information and explanation given to us, the Company has not made any preferential allotment of shares, during the year, to parties and companies covered in the register maintained under section 301 of the Act, and accordingly the question of the price being prejudicial to the interest of the Company does not arise. The Company has issued unsecured debentures, and therefore the question of creation of security does not arise.
ix) x)
xi)
xii)
xiii) xiv)
xv)
xvi)
xvii) The Company has not raised any money by public issues during the year covered by our report and therefore the question of end use thereof does not arise. xviii) According to the information and explanation given to us, no fraud by the Company has been noticed or reported during the year. As regards frauds on the Company during the year, the Company is investigating 8 cases of fraud in respect of documents submitted by clients, involving principal of Rs.1,704,940 thousand, which is written off in the books of the Company. For and on behalf of
Contractor, Nayak & Kishnadwala Chartered Accountants
Place: Mumbai Date: 27th April 2010
G. S. Nayak Partner Membership No.38127 ICAI Firm Registration No.101961W
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Comments of the Comptroller and Auditor Comments Comptroller General of India Under Section 619(4) of the General 619(4) Companies Act, 1956 on The Accounts Of SBI Accounts Global Factors Limited for the Year Ended 31 Factors Year 31 March 2010. March 201
The preparation of financial statements of SBI Global Factors Limited for the year ended 31 March 2010 in accordance with the financial reporting framework prescribed under the Companies Act, 1956 is the responsibility of the management of the company. The statutory auditor appointed by the Comptroller and Auditor General of India under Section 619(2) of the Companies Act, 1956 is responsible for expressing opinion on these financial statements under Section 227 of the Companies Act, 1956 based on independent audit in accordance with the auditing and assurance standards prescribed by their professional body the Institute of Chartered Accountants of India. This is stated to have been done by them vide their Audit Report dated 27 April 2010. I, on behalf of the Comptroller and Auditor General of India, have conducted a supplementary audit under Section 619(3)(b) of the Companies Act, 1956 of the financial statements of SBI Global Factors Limited for the year ended 31 March 2010. This supplementary audit has been carried out independently without access to the working papers of the statutory auditor and is limited primarily to the inquiries of the statutory auditor and Company personnel and a selective examination of some of the accounting records. On the basis of my audit nothing significant has come to my knowledge which would give rise to any comment upon or supplement to Statutory Auditors report under Section 619(4) of the Companies Act, 1956.
For and on the behalf of the Comptroller and Auditor General of India
(Alka. R. Bhardwaj) Principal Director of Commercial Audit and Ex-Officio Member, Audit Board-I, Mumbai Place: Mumbai Date :11 June, 2010
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Comments Comptroller Comments of the Comptroller and Auditor General 619(4) General of India Under Section 619(4) of the Accounts Companies Act, 1956 on the Accounts Of SBI Factors Commercial Factors And Commercial Services Private Limited Year 31 March for the Year Ended 31 March 2008
The preparation of financial statements of SBI Factors and Commercial Services Private Limited for the year ended 31 March 2008 in accordance with the financial reporting framework prescribed under the Companies Act, 1956 is the responsibility of the management of the Company, The Statutory Auditor appointed by the Comptroller and Auditor General of India under Section 619(2) of the Companies Act 1956 is responsible for expressing opinion on these financial statements under Section 227 of the Companies Act, 1956 based on independent audit in accordance with the auditing and assurance standards prescribed by their professional body the institute of Chartered Accountants of India. This is stated to have been done by them vide their Audit Report dated 17.4.2008. I on behalf of the Comptroller and Auditor General of India, have decided not to review the report of the Statutory Auditor on the accounts of SBI Factors and Commercial Services Private Limited for the year ended 31 March 2008 and as such have no comments to make under Section 619 (4) of the Companies Act, 1956.
For and on the behalf of the Comptroller and Auditor General of India
(Alka. R. Bhardwaj) Principal Director of Commercial Audit and Ex-Officio Member, Audit Board-I, Mumbai Place: Mumbai Date :4 March 2010
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SBI Global Factors Ltd. (Formerly known as Global Trade Finance Limited)
Balance Sheet
As At March 31, 2010
Schedule SOURCES OF FUNDS Shareholders Funds Share Capital Reserves and Surplus Loan Funds Unsecured Loans Total APPLICATION OF FUNDS Fixed Assets Gross Block Less: Depreciation / Amortisation Net Block Capital Advances Investments Deferred Tax Asset (Net) Current Assets, Loans and Advances Sundry Debtors Cash and Bank Balances Other Current Assets Loans and Advances Less: Current Liabilities and Provisions Current Liabilities Provisions Net Current Assets Total Significant Accounting Policies and Notes to Accounts (Rs. 000) March 31, 2010 (Rs. 000) March 31, 2009 (Rs. 000)
1 2
1,542,604 4,209,107 5,751,711
1,071,429 2,815,125 3,886,554 29,451,223 33,337,777
25,666,098 31,417,809
4 290,917 161,070 129,847 510 5 6 7 8 9 10 11 202,771 15,973 218,744 30,663,559 31,417,809 18 303,323 239,647 542,970 32,990,426 33,337,777 30,298,262 240,224 9,559 334,258 30,882,303 130,357 189,360 434,533 242,326 107,711 134,615 2,974 137,589 209,762 30,173,367 3,289,110 13,426 57,493 33,533,396
Schedules 1 to 18 referred to herein above form an integral part of the Balance Sheet.
As per our attached report of even date For Contractor, Nayak & Kishnadwala Chartered Accountants G. S. Nayak Partner M. No. 38127 ICAI Firm Registration No.101961W Mumbai Dated : April 27, 2010
For and on behalf of the Board of Directors
O.P. Bhatt Chairman
Sangeet Shukla Executive Vice Chairman & CEO
Amita Joshi Company Secretary
Mumbai Dated : April 27, 2010
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Profit And Loss Account

For The Year Ended March 31, 2010
Year Ended March 31, 2010 Schedule Rs. 000) INCOME Income from Factoring Interest Income Profit on Sale of Current Investments (Net) Other Income Total EXPENDITURE Employee Costs Operating and Other Expenses Interest and Financial Charges Depreciation / Amortisation Total PROFIT BEFORE TAXATION Provision for Taxation -Current Taxation -Excess Provision for Taxation for Earlier Years Written Back -Deferred Taxation -Wealth Tax -Fringe Benefits Tax 12 13 14 4,336,883 51,725 475,167 67,015 4,930,790 114,473 2,695,645 1,980,324 32,475 4,822,917 107,873 245,000 (12,660) (190,342) 63 42,061 65,812 921,615 Year Ended March 31, 2009 (Rs. 000) 4,611,372 130,195 328,945 51,281 5,121,793 112,135 826,763 2,948,380 33,781 3,921,059 1,200,734 583,000 (174,511) 65 1,300 409,854 790,880 606,418
15 16 17
PROFIT AFTER TAXATION Profit and Loss Account Balance Brought Forward from Previous Year Add : On account of amalgamation of erstwhile SBI Factors & Commercial Services Pvt. Ltd. (Refer Note 2 of Schedule 18) 10,000 BALANCE AVAILABLE FOR APPROPRIATION 997,427 1,397,298 APPROPRIATIONS: Dividend Paid - Equity - Preference Proposed Dividend - Equity 194,286 - Preference 9,500 9,500 Corporate Tax on Dividend 1,615 34,633 Transfer to General Reserve 79,088 Transfer to Reserve Fund 13,163 158,176 Transfer to Contingency Reserve 150,537 Profit and Loss Account Balance 822,612 921,615 Carried to the Balance Sheet Earnings per Share - Basic (Rs.) 0.38 8.45 Earnings per Share - Diluted (Rs.) 0.38 8.45 (Nominal Value of Share Rs. 10 each) (Refer Note 6 of Schedule 18) Significant Accounting Policies and Notes to Accounts 18 Schedules 1 to 18 referred to herein above form an integral part of the Profit and Loss Account.
As per our attached report of even date For Contractor, Nayak & Kishnadwala Chartered Accountants G. S. Nayak Partner M. No. 38127 ICAI Firm Registration No.101961W Mumbai Dated : April 27, 2010 For and on behalf of the Board of Directors O.P. Bhatt Chairman Sangeet Shukla Executive Vice Chairman & CEO
Amita Joshi Company Secretary Mumbai Dated : April 27, 2010

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Cash Flow Statement

March 31, 2010 (Rs. 000) (Rs. 000) Cash flow from Operating Activities: Net profit before tax Add: Interest Cost Net profit before tax and Interest Adjustments in: Depreciation / Amortisation (Profit) / Loss on sale of fixed assets Liabilities No Longer Required, Written Back Provision No Longer Required, Written Back Provision for doubtful debts & advances Bad Debts written off Share Issue Expenses written off Interest income on Fixed Deposits Provision for Leave Encashment Interest income Profit on sale of current investments Interest cost Operating profit before working capital changes Increase / (Decrease) in secured loans Increase / (Decrease) in unsecured loans (Increase) / Decrease in trade and other receivables Change in unexpired discount of Commercial Paper Increase / (Decrease) in trade and other payables Cash (used)/generated in and from operations Direct taxes paid (net) Net cash (used)/generated in and from operating activities (A) Cash flow from Investing Activities: Purchase of fixed assets Sale of fixed assets Interest Income Received Purchase in current investments Sale of current investments Net cash from investing activities (B) Cash flow from financing activities: Fresh Issue of Equity Share Capital Share issue expenses Dividend paid (Final) Net cash generated from financing activities ( C) Net increase in cash and cash equivalents (A + B + C) Cash and cash equivalents as at March 31, 2010/ 2009 - Cash in Hand - Cash & Bank Balances in current/FD account with banks
(Net of balances overdrawn as per books Rs. 3,077 thousand; Previous Year 402,450 thousand.)
March 31, 2009 (Rs. 000) (Rs. 000) 1,200,734 2,930,405 4,131,139
107,873 1,954,780 2,062,653
32,475 1,420 (30,656) 786,783 1,681,728 (51,707) (1,258) (18) (475,167) (1,954,780) (11,180) 2,051,473 0 (16,495,345) 12,139,659 (2,270) (367,931) (4,725,887) (2,674,414) (449,083) (3,123,497) (19,656) 1,242 57,862 (1,390,305,155) 1,390,780,322 514,615 (431,461) (431,461) (3,040,343) 2,596 234,551
33,781 1,688 (1,007) (131,323) 631,901 750 (129,926) (676) (269) (328,945) (2,930,405) (2,854,431) 1,276,708 (432,665) 1,291,082 24,134 882,551 2,159,259 (605,358) 1,553,901 (22,288) 634 170,578 (805,020,907) 805,349,850 477,867 750,000 (750) (131,072) 618,178 2,649,946 1,423 3,275,499
Less: Cash and cash equivalents as at March 31, 2010 / 2009
237,147 3,277,490 (3,040,343)
3,276,922 626,976 2,649,946
Note: 1. Cash and cash equivalents includes Fixed Deposit of Rs. NIL (Previous year Rs. 150,000 thousand) kept with bank as margin money for opening of client LCs. 2. Cash and cash equivalents includes unrealised gain (loss) of Rs. (213) thousand [Previous period Rs.(238) thousand] on account of translation of foreign currency bank balances. 3. The Company has changed its accounting policy for components of cash equivalents and it is considered that the change would result in a more appropriate presentation of financial statements. Earlier the cash and cash equivalents were net of Fixed Dep 4. The cash flow statement is prepared by the indirect method set out in Accounting Standard 3 notified by National Advisory Committee on Accounting Standards on Cash Flow Statement. 5. Previous Year figures have been regrouped / reclassified / rearranged wherever necessary.
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For and on behalf of the Board of Directors O.P. Bhatt Chairman Sangeet Shukla Executive Vice Chairman & CEO Amita Joshi Company Secretary Mumbai Dated : April 27, 2010
24
Schedules Annexed to and Forming Part of The Balance Sheet

March 31, 2010 (Rs. 000) March 31, 2009 (Rs. 000)
(Rs. 000) SCHEDULE 1 SHARE CAPITAL Authorised : 180,000,000 (Previous Year 120,000,000) Equity Shares of Rs. 10 each 120,000,000 (Previous Year 80,000,000) Preference Shares of Rs. 10 each Issued, Subscribed and Paid-up : 144,260,365 (Previous Year 97,142,855) Equity Shares of Rs. 10 each, fully paid-up (Note 1 and 3) 10,000,000 9.5% Non-convertible Redeemable Preference Shares of Rs. 10 each (Note 2)
1,800,000 1,200,000 3,000,000
1,200,000 800,000 2,000,000
1,442,604 100,000 1,542,604
971,429 100,000 1,071,429
Note 1 : Includes 32,142,856 shares issued on conversion of 6.25% Cumulative Convertible Preference Shares Note 2 : Redeemable at par on September 26, 2010. Note 3 : 120,355,205 (Previous Year 90,199,998) shares are held by the holding company, State Bank of India and its nominees SCHEDULE 2 RESERVES AND SURPLUS General Reserve As per last Balance Sheet Add : Balance of erstwhile SBI Factors & Commercial Services P Ltd (Refer Note 2 of Schedule 18) Add: Difference in the net assets of erstwhile SBI Factors & Commercial Services Pvt Ltd. and the face value of the new shares issued, pursuant to the scheme of Amalgamation (Refer Note 2 of Schedule 18) Add/(Less): Adjustments to opening balances of SBI Factors & Commercial Services P Ltd (Refer Note 2 of Schedule 18) a) provisions on debts b) depreciation on fixed assets Add: Transfer from Profit and Loss Account Reserve Fund (as required u/s 45 IC of RBI Act): As per last Balance Sheet Add:Transfer from erstwhile SBI Factors & Commercial Services P Ltd on account of Amalgamation Add: Transfer from Profit and Loss Account Contingency Reserve: (Refer Note below) As per last Balance Sheet Add:Transfer from erstwhile SBI Factors & Commercial Services P Ltd on account of Amalgamation Add: Transfer from Profit and Loss Account Securities Premium Account As per last Balance Sheet Add:On account of Amalgamation with erstwhile SBI Factors & Commercial Services P Ltd (Refer Note 2 of Schedule 18)
97,481 518,062 51,829
18,393 -
50,237 (4,268) 713,341 407,669 205,519 13,163 626,351 49,789 20,910 150,537 221,236 1,338,571 160,000
79,088 97,481 249,493 158,176 407,669 49,789 49,789 688,571 -
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Schedules Annexed To And Forming Part of The Balance Sheet

(Rs. 000) March 31, 2010 (Rs. 000) March 31, 2009 (Rs. 000
Add: On account of conversion of Preference shares of erstwhile SBI Factors & Commercial Services Pvt Ltd. during the year Add: Additions during the year Profit and Loss Account
326,996 1,825,567 822,612 4,209,107
650,000 1,338,571 921,615 2,815,125
Note: Contingency Reserve represents appropriation of profits as a prudent measure to meet any contingency arising out of non-realisation of debts factored. Transfer to Contingency Reserve is the aggregate of 0.125% of the total turnover and 0.5% of the uninsured portion of credit protection provided as an Import Factor, to the extent the same exceeds the amount transferred to Reserve Fund. SCHEDULE 3 UNSECURED LOANS Commercial Paper Maturity date: Apr 05, 2010 Maturity date: Apr 07, 2010 Maturity date: Apr 09, 2010 (Maximum outstanding balance Rs. 12,250,000 thousand) Overdraft facility from Banks (Repayable within one year Rs. NIL; March 31, 2009 Rs. 75 thousand) Short Term Rupee Loans from Banks (Repayable within one year Rs. 14,645,199 thousand; March 31, 2009 Rs. 22,999,891 thousand) Short Term Rupee Loan from State Bank of India (Repayable within one year Rs. 3,932,559; March 31, 2009 2,708,161 thousand) Short Term Foreign Currency Loans from Banks (USD 2,270 thousand ; March 31, 2009 USD 68,372 thousand and EUR 7,225 thousand) (Repayable within one year Rs. 102,455 thousand; March 31, 2009 Rs. 1,724,096 thousand) Short Term Foreign Currency Loan from State Bank of India (USD 47,782 thousand, EUR 127 thousand and GBP 313 thousand; March 31, 2009 USD 34,309 thousand) (Repayable within one year 2,185,885 thousand; March 31, 2009 1,019,000 thousand) 8.60 % 7 Years Non-Convertible Redeemable Debentures (Subordinated Debt) (Maturity date: May 17, 2013) - From Banks - From Others
2,000,000 1,000,000 500,000 3,500,000 -
75
14,645,199
22,999,891
3,932,559
2,708,161
102,455
1,724,096
2,185,885
1,019,000
20,000 58,000
20,000 58,000
9.40 % 6 Years Non-Convertible Redeemable Debentures (Subordinated Debt) (Maturity date: July 02, 2012) - From Banks - From Others
220,000 2,000
220,000 2,000
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(Rs. 000) March 31, 2010 (Rs. 000) March 31, 2009 (Rs. 000
9.50 % 6 Years Non-Convertible Redeemable Debentures (Subordinated Debt) (Maturity date: Aug 23, 2012) - From Banks 10.40 % 5 Years 7 Months Non-Convertible Redeemable Debentures (Subordinated Debt) (Maturity date: Apr 18, 2013) - From Banks - From Others 10.30 % 5 Years 7 Months Non-Convertible Redeemable Debentures (Subordinated Debt) (Maturity date: Jul 18, 2013) - From Banks - From Others 9.75 % 7 Years 1 Month Non-Convertible Redeemable Debentures (Subordinated Debt) (Maturity date: Apr 04, 2016) - From Others 7.35% Promissory Notes of Rs. 100 Lakhs each (Subordinated Debt) (Maturity date: Apr 30, 2014) - From Banks - From Others
200,000
200,000
174,000 78,000
224,000 28,000
100,000 50,000
140,000 10,000
98,000
98,000
50,000 250,000 25,666,098
29,451,223
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SCHEDULE 4 FIXED ASSETS [Refer Notes 2(iii) and 2(iv) of Schedule 18]
(Rs. 000)
Particulars Additions on Deductions/ amalgamation Adjustments during during the the Year Year As at March 31, 2010 As at April 1, 2009 For the year On Additions Deductions on during the amalgmation Year during the year As at March 31, 2010
Gross Block (At Cost)
Depreciation / Amortisation
Net Block As at March 31, 2010 As at March 31, 2009
As at April 1, 2009
Additions during the Year
Tangible Assets 113 4,401 12,966 10,120 4,491 42,742 537 12,660 7,098 2,684 3,548 35,722 18,890 4,383 1,327 49,582 29,232 5,485 1,904 20,888 7,904 3,442 1,490 1,200 3,163 337 2,955 4,782 99,179 10,089 1,617 373 3,588 11,157 8,901 12,079 13,444 44,674 29,011 9,445 26,935 87,100 84,195 7,444 4,908 6,711 3,215 8,097 6,117 8,614 4,983 15,807 17,675
28
18,532 11,358 6,009 38,278 7,775 11,807 30,144 15,966 3,506 9,145 79,383 33,781 5,453 290,917 107,711 32,475 242,326
Building *
94,284
Office Equipment
16,001
2,390
Computers - Hardware
35,349
2,594
Furniture and Fixtures
27,504
1,646
Vehicles
12,081
1,116
Leasehold Improvements
36,207
11,026
Intangible Assets 6,010 25,482 4,662 4,934 30,029 161,070 129,847 134,615 - 107,711 510 2,974 130,357 137,589
Computers - Software
20,900
3,235
Total
242,326
22,120
Previous Year
222,637
27,464
Capital Advances
* Includes Rs. 500 being the value of shares in Co-operative Housing Society

(Rs. 000) March 31, 2010 (Rs. 000) March 31, 2009 (Rs. 000)
SCHEDULE 5
INVESTMENTS Long Term Unquoted trade Investments 2,367 (Previous Year Nil) Optionally Convertible Redeemable Bonds of M/s. K. Sera Sera Productions Ltd. of Rs.100,000 each Less : Provision for Doubtful Investments
236,700 47,340
189,360 189,360
SCHEDULE 6 DEFERRED TAX (LIABILITY)/ASSET Deferred Tax Asset arising on account of timing differences in: - Provision for Doubtful Debts - Provision for Doubtful Investments - Disallowances U/s 43B - Depreciation - Allowability of Amalgamation expenses
410,721 15,725 203 1,238 6,646
212,928 380 (3,546) -
434,533 434,533
SCHEDULE 7 SUNDRY DEBTORS (Secured) Debts Factored (Considered Good) Debts outstanding for a Period Exceeding Six Months* Other Debts (Unsecured) Debts Factored Debts outstanding for a Period Exceeding Six Months - Considered Good * - Considered Doubtful Other Debts (Considered Good) - Considered Good - Considered Doubtful
209,762 209,762
1,818,157 10,223,256 12,041,413
318,080 4,870,093 5,188,173
6,232,998 1,23,461 7,469,459 12,023,851 12,023,851 19,493,310 31,534,723 1,236,461 30,298,262
5,650,299 626,442 6,276,741 19,334,895 19,334,895 25,611,636 30,799,809 626,442 30,173,367
Less: Provision for Doubtful Debts
* These debts include debts which are either not due or not overdue for a period of more than six months and, hence, do not require a provision as at March 31, 2010 in accordance with the Company policy as stated in Note 2(vii) on Schedule 18.
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(Rs. 000) SCHEDULE 8 CASH AND BANK BALANCES Cash on Hand (Including Stamp Papers on hand Rs. 2,517 thousand [Previous Year Rs. 1,338 thousand]) Balances with Scheduled Banks in: - Current Accounts - Fixed Deposit Accounts March 31, 2010 (Rs. 000) March 31, 2009 (Rs. 000)
2,596 236,628 1,000 240,224
1,423 137,687 3,150,000 3,289,110
SCHEDULE 9 OTHER CURRENT ASSETS Interest Receivable Unexpired discount on issue of Commercial Papers (Refer Note 2[xiv] on Schedule 18)
7,289 2,270 9,559
13,426 13,426
SCHEDULE 10 LOANS AND ADVANCES (Unsecured and Considered Good) Advances Recoverable in Cash or in Kind or for Value to be Received Import Factor Commission Receivable Prepaid Expenses Deposits Advance Tax and Tax Deducted at Source (Net of Provision for Tax Rs. 1,927,776 thousands [Previous Year Rs. 1,267,600 thousands]) Advance Fringe Benefit Tax (Net of Provision for Tax Rs. 5,839 thousands [Previous Year Rs. 4,415 thousands])
4,484 3,267 45,921
1,764 300 2,668 22,118
280,078
30,597
508 334,258
46 57,493
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(Rs. 000) SCHEDULE 11 CURRENT LIABILITIES AND PROVISIONS Current Liabilities Sundry Creditors - Dues to Micro Enterprises and Medium Enterprises - Dues to Others The Company has not received any intimation from suppliers regarding their status under the Micro, Small and Medium Enterprises Development Act, 2006 and hence disclosures, if any, relating to amounts unpaid as at the year end together with interest paid/payable as required under the said Act have not been given. Other Liabilities [Including Rs. 2,196 thousand towards gratuity (previous year Rs.494 thousand)] Discount Charges Received in Advance, not accrued Balance with Scheduled Banks overdrawn as per books (Note : Arising on account of cheques issued against expected receipts) Interest Accrued But Not Due Provisions Proposed Dividend - Equity - Preference Corporate Tax on Dividend Provision for Compensatory Absenses Wealth Tax (Net of Advance Tax Rs. 211 Thousand [Previous Year Rs. 147 Thousand]) Income Tax (Net of Advances Tax Rs. 114,110 Thousand) Fringe Benefit Tax (Net of Advances Tax Rs. 1,253 Thousand) 9,500 1,615 608 106 4,143 1 15,973 218,744 194,286 9,500 34,633 1,120 108 239,647 542,970 42,940 130,644 3,077 138,757 79,012 12,188 11,914 11,914 19,458 19,458 March 31, 2010 (Rs. 000) March 31, 2009 (Rs. 000)
14,196 202,771
53,908 303,323
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Schedules Annexed To And Forming Part of The Profit & Loss Account
March 31, 2010 (Rs. 000) SCHEDULE 12 INCOME FROM FACTORING Discount Charges Factoring Charges (Tax Deducted at Source Rs. 46,732 thousand; Previous Year Rs. 45,320 thousand) Processing Charges - Gross (Tax Deducted at Source Rs. 603 thousand; Previous Year Rs. 4,364 thousand) Import Factor Commission 4,122,875 165,889 4,215,770 308,590 March 31, 2009 (Rs. 000)
48,119
86,760
4,336,883
252 4,611,372
SCHEDULE 13 INTEREST INCOME Interest on Balances with Banks Interest on Fixed Deposits with Banks - Gross (Tax Deducted at Source Rs. 13,820 thousand; Previous Year Rs. 26,327 thousand) Other Interest Income 11 51,707 269 129,926
7 51,725
130,195
SCHEDULE 14 OTHER INCOME Income on Foreign Exchange Transactions Exchange Gain (net) Liabilities No Longer Required, Written Back Provision for Earlier Years Written Back Miscellaneous 24,218 2,467 1,703 28,953 9,674 67,015 43,766 1,938 1,007 4,570 51,281
SCHEDULE 15 EMPLOYEE COSTS Salaries * Contribution to Provident Fund Staff Welfare Gratuity Compensatory Absenses Bonus and Exgratia 95,010 4,805 7,727 2,189 (1,258) 6,000 114,473 72,922 3,372 5,340 494 7 30,000 112,135
*- Includes prior period expenditure of Rs. 282 thousand (Previous Year Nil)
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Schedules Annexed To And Forming Part of The Profit & Loss Account
March 31, 2010 (Rs. 000) SCHEDULE 16 OPERATING AND OTHER EXPENSES Correspondent Fees Credit Insurance Charges Rent, Rates and Taxes Repairs and Maintenance - Building - Others Communication Travelling Conveyance Advertisement & Publicity Auditors Remuneration Utilities Insurance Membership and Subscription Motor Car Running Expenses Printing and Stationery Legal and Professional Fees Syndication Fees Outsourcing Costs Directors Sitting Fees (Profit)/Loss on Sale of Fixed Assets (net) Provision for Doubtful Debts Bad Debts written of Less : Provisions Written Back Provision of Doubtful Investments Security Charges Service Tax Share Issue Expenses Miscellaneous 674 6,954 66,147 2,105 13,965 10,500 11,447 763 463 1,550 7,614 1,921 2,395 1,624 3,105 82,897 4,704 958 1,420 739,443 1,858,018 176,290 1,681,728 47,340 1,851 886 3,191 2,695,645 1,910 59,018 29,105 2,014 9,337 9,865 6,084 327 2,441 1,500 4,914 1,794 1,777 2,694 3,240 36,674 6,165 5,854 860 1,688 631,901 2,411 1,910 1,061 750 1,469 826,763 March 31, 2009 (Rs. 000)
SCHEDULE 17 FINANCIAL EXPENSES Interest on : - Non-Convertible Redeemable Debentures - Short Term Loans (including Overdraft) - Others Bank Charges Credit Rating Fees Discount on Issue of Commercial Papers Brokerage on Market Borrowing Stamp Duty
699,806 915,718 10,234 8,684 339,256 2,780 3,846 1,980,324
745,009 2,024,492 60 9,878 6,318 160,904 1,719 2,948,380
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Schedule Annexed To And Forming Part of The Balance Sheet As At March 31, 2010 And Profit And Loss Account For The Year Ended March 31, 2010
SCHEDULE 18: SIGNIFICANT ACCOUNTING POLICIES AND NOTES TO ACCOUNTS
1 SIGNIFICANT ACCOUNTING POLICIES i) Basis of Accounting The Accounts are prepared under historical cost convention from the books of account maintained on accrual basis, and comply in all material respects with the accounting standards notified by the Companies Accounting Standard Rules, 2006 as amended and the relevant provisions of the Companies Act, 1956, of India (the Act). ii) Use of Estimates The preparation of financial statements in conformity with generally accepted accounting principles requires estimates and assumptions to be made that affect the reported amount of assets and liabilities on the date of the financial statements and the reported amount of revenues and expenses during the reporting period. Difference between the actual results and estimates are recognised in the period in which the results are known/materialised. iii) Fixed Assets a. Tangible Assets Tangible assets are stated at cost of acquisition, less accumulated depreciation. b. Intangible Assets Intangible Assets are stated at cost of acquisition less accumulated amortisation. iv) Depreciation / Amortisation a . Tangible Assets The Company provides depreciation on following assets on the straight-line method at the rates higher than those prescribed in Schedule XIV to the Companies Act, 1956 Asset Rate Office Equipment 20.00% Computer Hardware 33.33% Furniture & Fixtures 20.00% Vehicles 25.00% On other assets, the Company provides depreciation on the straight-line method at the rates and in the manner prescribed in Schedule XIV to the Companies Act, 1956. Assets individually costing Rs. 5,000 or less are depreciated at the rate of 100% in the year of purchase. Leasehold improvements are amortised over the period of lease. b. Intangible Assets Computer Software is amortised on straight-line method over a period of 3 years. v) Impairment of Fixed Assets An asset is treated as impaired when the carrying cost of assets exceeds its recoverable value. An impairment loss is charged to the Profit and Loss Account in the year in which an asset is identified as impaired. The impairment loss recognised in prior accounting periods is reversed if there has been a change in the estimate of recoverable amount. vi) Reserve Bank of India Prudential Norms The Company follows the guidelines issued by the Reserve Bank of India, in respect of income recognition and valuation of investments. In respect of asset classification, the company follows the guidelines issued by the Reserve Bank of India / stricter norms.
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vii) Provisioning Norms The provisioning norms followed by the Company are more stringent than those prescribed by Reserve Bank of India and are as follows: I. Classification of Non-performing asset: Category Criteria Sub-Standard Assets Doubtful Assets Loss Assets Principal and/or Interest overdue for 6 months or more Principal and/or Interest overdue for 24 months or more 1. An asset which has been identified as loss asset by the company or its internal or external auditor or by the Reserve Bank of India during the inspection of the company, to the extent it is not written off by the company; and 2. An asset which is adversely affected by a potential threat of non- recoverability due to either erosion in the value of security or non-availability of security or due to any fraudulent act or omission on the part of the borrower
II. Provisioning for Non-performing asset: (a) The portion of advance/ asset not covered by value of tangible security will be provided for cumulatively as under: Category Provision Sub Standard Assets 20% Doubtful Assets 100% Loss Assets 100% (b) In addition to II (a) above, the portion of advance/ asset covered by value of tangible security will be provided for cumulatively as under: Provision % Sub-Standard Asset 20% Period for which the advance remains doubtful Period for which the advance remains doubtful Provision % Upto 1 year 20% More than 1 year and upto 3 years 50% More than 3 years full loan will migrate to Loss Asset 100% III. Additional provisions is also made as and when considered necessary. viii) Investments Current Investments are valued at lower of cost and fair value. ix) Foreign Currency Transactions Foreign currency transactions are recorded at the exchange rates prevailing on the date of such transactions. Monetary assets and liabilities as at the Balance Sheet date, are translated at the rates of exchange prevailing at the date of the Balance Sheet. In case of assets and liabilities covered by forward contracts, the forward premium is recognized over the life of the Contract and the difference between the year end rate and rate on date of contract is recognized as exchange difference. Gains and losses arising on account of differences in foreign exchange rates on settlement/ translation of monetary assets and liabilities are recognized in the Profit and Loss Account.
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x) Revenue Recognition (i) Discount charges and interest on advances are accrued on time basis on the balances in the prepayment accounts at the applicable discount/ interest rates. (ii) Factoring charges are accrued on factoring of debts at the applicable rates. (iii) Processing charges are accrued at the time of sanction of the factoring/ financing limits by the Company. (iv) Revenue excludes Service Tax, wherever recovered. xi) Debts Factored Debts factored by the Company are included under Current Assets as Sundry Debtors (to the extent funds are paid to the clients). xii) Taxes on Income a) Current tax is determined as the amount of tax payable in respect of taxable income for the period. b) Deferred tax expense or benefit is recognised on timing differences being the difference between taxable income and accounting income that originate in one period and are capable of reversal in one or more subsequent periods. Deferred tax asset and liabilities are measured using the tax rates and tax laws that have been enacted or substantively enacted at the Balance Sheet date. Deferred Tax Asset in respect of carry forward of losses and depreciation is recognised only to the extent that there is virtual certainty that sufficient taxable income will be available to realise this asset. All other deferred tax assets are recognised only to the extent that there is reasonable certainty that sufficient future taxable income will be available to realise these assets. xiii) Employee Benefits Short term employee benefits : All employee benefits payable wholly within 12 months of rendering service are classified as short term employee benefits. These benefits include compensated leave such as paid annual leave and sick leave in case of the companys employees. For such compensatory absenses provision is made on actual basis based on balance of unutilized leave available to the employees as at the balance sheet date. The undiscounted amout of short term employee benefits expected to be paid in exchange for services rendered by employees is recognized an an expense during the year. Long term employee benefits : Provident Fund is a defined contribution scheme and the companys contributions are charged to the profit & loss account of the year. Long term compensated absence (in the case employees of ertswhile SBI Factors & Commercial Services Pvt. Ltd. only) are provided for based on an actuarial valuation. Retirement benefits in the form of gratuity liability is provided at the end of each year, on the basis of an actuarial valuation based on the projected unit credit method as per Accounting Standard 15 on Employee Benefits. Actuarial gains/losses are recognized immediately in the profit and loss account. xiv) Discount on issue of Commercial Paper Discount on issue of commercial papers is amortised over the period to maturity of the commercial paper. Unexpired discount as at the year end is included under Other Current Assets. xv) Provision, Contingent Liabilities and Contingent Assets Provisions involving substantial degree of estimation in measurement are recognised when there is a present obligation as a result of past events and it is probable that there will be an outflow of resources. Contingent Liabilities are not recognised but are disclosed in the notes. Contingent Assets are neither recognised nor disclosed in the financial statements.
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xvi) Borrowing Costs All borrowing costs are charged to revenue. xvii) Leased Assets Rentals in respect of assets taken on operating lease by the company are expensed as per the terms of the lease agreement. 2 The Scheme of Amalgamation (the Scheme) of SBI Factors and Commercial Services Private Limited (the transferor company) (hereinafter referred to as SBIF) with the Company (the transferee company) as approved by the shareholders and was subsequently sanctioned by the Honble High Court at Mumbai vide its Order passed on 15th January 2010 and filed with the Registrar of Companies on February 1, 2010. The transferor company (erstwhile SBIF) is engaged in the business of offering factoring services to client mostly in the small and medium enterprises sector to meet their working capital requirements. The transferee company (GTF) is also engaged in factoring services. In accordance with the scheme all the assets, liabilities, reserves, duties and obligations of SBIF were transferred to and vested in the Company with effect from 1st April, 2009 ( The Appointed Date) and these financial statements include the assets, liabilities and reserves of SBIF with effect from 1 April, 2009. The results for the year ended 31st March 2010, pending completion of relevant formalities of transfer of assets, liabilities and arrangements acquired pursuant to the above mentioned scheme, include such assets, liabilities and arrangements remain in the name of erstwhile SBIF. As per the Scheme of Amalgamation, each of the shareholders of the erstwhile SBIF, was allotted 100 fully paid up equity shares of Rs.10 each of the company, for every 111 fully paid up equity shares held by them in SBIF as on the record date (including those equity shares which were allotted after the conversion of the CCP shares). Accordingly 47,117,510 fully paid up equity shares of Rs.10 each have been allotted to the shareholders of erstwhile SBIF. These equity shares rank pari passu with the existing equity shares of the company. The amalgamation has been accounted for under the pooling of interests method as prescribed by Accounting Standard 14 (AS 14) Accounting for Amalgamations issued under Companies Accounting Standard Rules, 2006 and the relevant provisions of the Companies Act, 1956. Accordingly, the assets, liabilities and other reserves of the erstwhile SBIF as at 1st April, 2009 have been taken over at their book values as under Rs. 000 Assets taken over at book values: Fixed Assets Current Assets, Loans & Advances Less: Liabilities taken over at book value: Reserves & Surplus (after conversion of the preference shares)* Secured Loans Unsecured Loans Current Liabilities and provisions Net assets taken over 12,567 16,357,694 1,241,486 8,454,714 4,255,506 1,895,551 523,004
* In accordance with the Scheme of Amalgamation the balances in the following Reserves as at the appointed date have been transferred to the Company at their book values: Reserves & Surplus Share Premium (after conversion of the preference shares) General Reserve Profit & Loss Account Contingency Reserve Statutory Reserve u/s 45IC of RBI Act. Rs. 000 486,996 518,062 10,000 20,910 205,518 1,241,486
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In accordance with the Scheme of Amalgamation, an amount of Rs. 51,829 thousands, being the difference in the aggregate of the net assets of SBIF and the aggregate face value of the new shares issued to the transferor company, pursuant to this scheme has been credited to the General Reserve. Pursuant to the scheme of amalgamation, the company has decided to change the policy of providing depreciation on assets of the erstwhile SBIF (which was written down value method) so as to make it consistent with the policy of providing depreciation in case of the company (which is straight line method). As a result of the above, as per the scheme of amalgamation, an amount of Rs. 4,268 thousands, being the difference in the carrying value of fixed assets as on 1st April 2009 (the appointed date) because of this change has been debited to General Reserve. Pursuant to the scheme of amalgamation, the company has decided to change the policy of provisioning norms on assets of the erstwhile SBIF so as to make it consistent with that of the company. As a result of the above, as per the scheme of amalgamation, an amount of Rs. 50,237 thousands, being the difference in the provision for doubtful debts as on 1st April 2009 (the appointed date) on account of this change has been credited to General Reserve. In view of aforesaid amalgamation with effect from 1April, 2009, the figures for the current year are strictly not comparable to those of the prior year. 3 Contingent Liabilities : a) No provision has been made in respect of certain disputed demands of Income Tax/Service Tax pending disposal of appeals/rectification filed by the company with the appellate authorities amounting to Rs. 71,839 Thousand (As at March 31, 2009 Rs. 24,023 Thousand). b) Contingent liability not provided for in respect of credit protection provided by the company as an Import Factor amounted to Rs. 2,563 Thousand (as at 31st March, 2009 Rs. 11,985 Thousand). In case of the credit protection being enforced, the company has insured itself to the extent of 90% of the liability which amounts to NIL (as at 31st March, 2009 Rs. 10,787 Thousand). c) Contingent liability not provided for in respect of credit protection provided by the company on Bank Letter of Credit (LCs) opened for the clients amounting to NIL (as at 31st March 2009 Rs. 11,485 Thousand).
4 Details of Operating Leases as lessee: Particulars Lease payments debited to the Profit and Loss Account on account of cancelable lease agreements Current Year Rs. 000 65,584 Previous Year Rs. 000 29,105
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The company has a defined benefit gratuity plan for its employees and is funded in a separate gratuity trust. Where as for employees of erstwhile SBI Factors it is a defined contribution plan and is funded with an insurance company in the form of a group gratuity policy. Disclosure for Gratuity in case of employees of the company, as per revised Accounting Standard 15 on Employee Benefits, (AS 15) is as follows: Table 1 Amount to be Recognized in Balance Sheet Year Ended 31/03/2010 (in Rs. 000) Present Value of Funded Obligations Fair Value of Plan Assets Present Value of Unfunded Obligations Unrecognized Past Service Cost Net Liability Amounts in the Balance Sheet Liabilities Assets Net Liability 1,862 (2,257) (395) (395) (395) Year Ended 31/03/2009 (in Rs. 000) 2,188 (1,694) 494 494 494
Table 2 Expense Recognized in Statement of Profit & Loss Account Year Ended 31/03/2010 (in Rs. 000) Current Service Cost Interest on Defined Benefit Obligation Expected Return on Plan Assets Net Actuarial Losses / (Gains) Recognized in Year Past Service Cost Losses / (Gains) on Curtailments & Settlements Total, included in Employee Benefit Expense Actual Return on Plan Assets 605 175 (136) (1,039) (395) 68 Year Ended 31/03/2009 (in Rs. 000) 935 162 (83) (520) 494 50
Table 3 Reconciliation of Benefit Obligations & Plan Assets for the Period Year Ended 31/03/2010 (in Rs. 000) Change in Defined Benefit Obligation Opening Defined Benefit Obligation Current Service Cost Interest Cost Actuarial Losses / (Gain) Liabilities Extinguished on Curtailment Liabilities Extinguished on Settlements Liabilities Assumed on Acquisition Exchange Difference on Foreign Plans Benefits Paid Closing Defined Benefit Obligation Change in the Fair Value of Assets Opening Fair Value of Plan Assets Expected Return on Plan Assets Actuarial Gains / (Losses) Assets Distributed on Settlements Contributions by Employer Assets Acquired due to Acquisition Exchange Difference on Foreign Plans Benefits Paid Closing Fair Value of Plan Assets 2,188 605 175 (1,106) 1,862 Year Ended 31/03/2009 (in Rs. 000) 1,644 935 162 (553) 2,188
1,694 136 (67) 494 2,257
1,111 83 (33) 533 1,694

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Table 4 Asset Information Category of Assets Government of India Securities Corporate Bonds Special Deposit Scheme Equity Shares of Listed Companies Property Insurer Managed Funds Others; Bank Deposits Total Year Ended 31/03/2010 % 0% 0% 0% 0% 0% 0% 100% 100% Year Ended 31/03/2009 % 0% 0% 0% 0% 0% 0% 100% 100%
The approximate market value of the assets as at 31 March 2010 was Rs. 2,257 thousand a break up of the same is as follows: Category of Assets Government of India Securities Corporate Bonds Special Deposit Scheme Equity Shares of Listed Companies Property Insurer Managed Funds Others; Bank Deposits Total (Rs. 000) 2.257 2,257 (Rs. 000) 1,694 1,694
Table 5 Summary of Actuarial Assumptions Financial Assumptions at the Valuation Date: March 31, 2010 Discount Rate Expected Rate of Return on Plan Assets Salary Escalation Rate 8.00% 8.00% 5% March 31, 2009 8.00% 8.00% 5%
Disclosure for Gratuity in case of employees of erstwhile SBI Factors and Commercial Services Pvt. Ltd., as per revised Accounting Standard 15 on Employee Benefits, (AS 15) is as follows: Profit & Loss Account Net Employee benefit expense (recognised in Employee Cost) 31-Mar-10 (Rs. 000) 301 175 -89 1 0 387 0 154
Current service cost Interest cost on benefit obligation Expected return on plan assets Net actuarial (gain) / loss recognised in the year Past service cost Net benefit expense Actual return on plan assets Balance sheet Details of Provision for gratuity Defined benefit obligation Fair value of plan assets Less: Unrecognised past service cost Plan asset / (liability)
2373 1215 -1158 -1158
Changes in the present value of the defined benefit obligation are as follows:
31-Mar-10 (Rs. 000)

Opening defined benefit obligation Interest cost
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40
Current service cost Benefits paid Actuarial (gains) / losses on obligation Closing defined benefit obligation Changes in the fair value of plan assets are as follows:
301 -109 65 2373
Opening fair value of plan assets Expected return Contributions by employer Benefits paid Actuarial gains / (losses) Closing fair value of plan assets
31-Mar-10 (Rs. 000) 898 89 273 -109 64 1215
The Company expects to contribute Rs.464 thousand to gratuity in 2010-11. The major categories of plan assets as a percentage of the fair value of total plan assets are as follows: 31-Mar-10 % 100%
Investments with insurer
The overall expected rate of return on assets is determined based on the market prices prevailing on that date, applicable to the period over which the obligation is to be settled. The principal assumptions used in determining gratuity and post-employment medical benefit obligations for the Companys plans are shown below: 31-Mar-10 % Discount rate 8% Expected rate of return on Plan assets 8% Salary Escalation Rate 5%
6 Earnings Per Share:

Current Year Rs. 000 65,812 11,115 54,697 144,260,365 10 0.38 Previous Year Rs. 000 790,880 26,176 764,704 77,252,146 10 9.90
Net Profit after tax Less: Dividend to Preference Shareholders (incl. tax thereon) Profit available to Equity Shareholders Weighted average number of Equity shares outstanding during the period (Refer Note 19) Nominal Value of Equity Shares (Rs.) Basic and Diluted Earnings Per Share (Rs.)
(A) (B) (A) / (B)
7 Segment information for primary segment reporting (by business segments)

Based on guiding principles given in the Accounting Standard on Segment Reporting (AS-17), the Primary segment of the Company is business segment, which comprises of factoring activity. As the company operates in a single primary business segment, no segment information thereof is given. Segment information for secondary segment reporting (by geographical segments) The Company has a customer base within and outside India. Particulars Revenues from external customers (Previous Year) Segment assets (Previous Year) Capital Expenditure -Tangible (Previous Year) -Intangible (Previous Year) Domestic 4,080,156 4,036,695 23,409,319 30,606,288 18,885 17,938 3,235 4,350 International 256,722 574,677 6,889,696 3,274,459 (Rs. 000) Total 4,336,879 4,611,372 30,299,016 33,880,747 18,885 17,938 3,235 4,350
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Disclosure on Derivatives
The Foreign Currency Exposures that have not been hedged by a derivatives instrument or otherwise as on 31st March, 2010 are as follows: Currency Amount 000 47,397 (52,058) 138 (1,191) 322 (9) 16 (160) 9 (3) 3 (2) 50,052 (52,309) 137 (1,155) 495 Amount Rs. 000 2,139,510 (2,652,368) 8,333 (80,364) 21,931 (665) 733 (8,175) 523 (172) 172 163 2,259,354 (2,665,157) 8,302 (77,939) 33,671 -
Currency (a) Assets (Receivables) USD EUR GBP (b) Liability (Payables) USD EUR GBP (c) Loans Payable USD EUR GBP
As the Company has Foreign Currency outstanding Receivables & Payables which offset each other, the net foreign currency exposure is minimal. The above disclosure have been made consequent to an announcement by the Institute of Chartered Accountant of India in December, 2005, which is applicable to the financial period ending on or after 31st March, 2006.
9A
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22
Related Party Disclosures

Name of Related Party Mr. Sangeet Shukla Mr. Arvind Sonmale Mr. V. K. Gupta State Bank of India (SBI) SBI Mutual Fund SBI Capital Markets Limited SBI Funds Management Private Limited SBI DFHI Limited SBI Cards & Payments Services Pvt. Ltd. (SBICPSL) State Bank of Bikaner and Jaipur (SBBJ) State Bank of Hyderabad (SBH) State Bank of Indore (SBIr) State Bank of Mysore (SBM) State Bank of Patiala (SBP) State Bank of Travancore (SBT) SBICI Bank Ltd State Bank of India International (Mauritius) Ltd State Bank of India (California) State Bank of India (Canada) INMB Bank Ltd, Lagos SBI Life Insurance Company Ltd (SBI LIFE) SBICAP Securities Ltd Relationship Key Management Personnel (KMP) Key Management Personnel (KMP) Key Management Personnel (KMP) Holding Company Associate Fellow Subsidiary (Non-Banking) Fellow Subsidiary (Non-Banking) Fellow Subsidiary (Non-Banking) Fellow Subsidiary (Non-Banking) Fellow Subsidiary (Banking) Fellow Subsidiary (Banking) Fellow Subsidiary (Banking) Fellow Subsidiary (Banking) Fellow Subsidiary (Banking) Fellow Subsidiary (Banking) Fellow Subsidiary (Banking) Fellow Fellow Fellow Fellow Fellow Fellow Subsidiary Subsidiary Subsidiary Subsidiary Subsidiary Subsidiary (Banking) (Banking) (Banking) (Banking) (Non-Banking) (Non-Banking)
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B
Sr. No. 1
List of Related Party Transactions: Transactions
Current Year (Rs. 000) (Previous years figures are given in brackets) Holding Company Fellow Subsidiaries Associates Key Mgt Personnel (KMP)
EQUITY SHARE CAPITAL State Bank of India Opening balance Acquired during the year Issue during the year * Closing Balance Allotted on Conversion of 7.5% Compulsorily Convertible Preference Shares # SIDBI 902,000 (802,000) (-) 301,552 (100,000) 1,203,552 (902,000) 46,723
Allotted on Conversion of 7.5% Compulsorily Convertible Preference Shares #

State Bank of Indore Opening balance Acquired during the year Issue during the year * Allotted on Conversion of 7.5% Compulsorily Convertible Preference Shares # Closing Balance (-) (-) 28,271 (-) 4,380 (-) 28,271 (-)
14,601
B.
7.5% COMPULSORILY CONVERTIBLE PREFERENCE SHARES 256,000 (-) (256,000) 256,000 (-) (256,000) 24,000 (-) (24,000) 24,000 (-) (24,000) 80,000 (-) (80,000) 80,000 (-) (80,000)
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State Bank of India Opening balance Additions during the year Converted into Equity Shares during the year # Closing Balance State Bank of Indore Opening balance Additions during the year Converted into Equity Shares during the year # Closing Balance SIDBI Opening balance Additions during the year Converted into Equity Shares during the year # Closing Balance
43
Current Year (Rs. 000) (Previous years figures are given in brackets) Holding Company Fellow Associates Key Mgt Subsidiaries Personnel (KMP)
Sr. No.
B. SECURITIES PREMIUM State Bank of India Opening balance Issue during the year * Closing Balance 2. UNSECURED LOAN SBI International - Mauritius Opening balance Loans taken during the existence of relationship Loans repaid during the existence of relationship Closing Balance 1,136,657 (752,333) 8,730,399 (12,834,711) 9,764,601 (12,450,387) 102,455 (1,136,657) 1,300,000 (650,000) (650,000) 1,300,000 (1,300,000)
SBI London Opening balance Loans taken during the existence of relationship Loans repaid during the existence of relationship Closing Balance
2,124,506 (759,984) 12,879,329 (7,035,600) 12,814,043 (5,681,684) 2,189,792 (2,124,506)
State Bank of Mysore Opening balance Loans taken during the existence of relationship Loans repaid during the existence of relationship Closing Balance State Bank of Hyderabad Opening balance Loans taken during the existence of relationship Loans repaid during the existence of relationship Closing Balance State Bank of Patiala Opening balance Loans taken during the existence of relationship Loans repaid during the existence of relationship Closing Balance 500,000 (-) (6,000,000) 500,000 (5,500,000) (500,000) 4,000,000 999,998 7,000,000 (4,000,000) 7,000,000 (999,998) 4,000,000 (4,000,000) (1,000,000) (-) (1,000,000) (-)
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Current Year (Rs. 000) (Previous years figures are given in brackets) Holding Fellow Associates Key Mgt Company Subsidiaries Personnel (KMP)
Sr. No.
State Bank of India Opening balance Loans taken during the existence of relationship Loans repaid during the existence of relationship Closing Balance
3,108,161 (600,000) 9,480,000 (27,494,489) 8,601,523 (24,986,329) 3,980,000 (3,108,161)
State Bank of Travancore Opening balance Loans taken during the existence of relationship Loans repaid during the existence of relationship Closing Balance
2,500,000 3,000,000 (3,500,000) 2,500,000 (1,000,000) 3,000,000 (2,500,000)
State Bank of India CP Opening balance Loans taken during the existence of relationship Loans repaid during the existence of relationship Closing Balance
(-) 2,000,000 (-) 2,000,000 (-) (-)
State Bank of India -7.35% Subordinate Debt Opening balance Loans taken during the existence of relationship Loans repaid during the existence of relationship Closing Balance
50,000 (-) (-) (-) 50,000 (-)
BANK BALANCE State Bank of India (Admin) CC A/c Closing Balance State Bank of Mysore (INR Loan) Opening balance Loans taken during the existence of relationship Loans repaid during the existence of relationship Closing Balance
-7,101 (-) 647,442 (725,908) 5,142,835 (6,292,052) 5,790,577 (6,370,517) (290) (647,452)
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Current Year (Rs. 000) (Previous years figures are given in brackets) Holding Company Fellow Subsidiaries Associates Key Mgt Personnel (KMP)
Sr. No.
State Bank of Patiala Opening balance Loans taken during the existence of relationship Loans repaid during the existence of relationship Closing Balance State Bank of India INR Opening balance Loans taken during the existence of relationship Loans repaid during the existence of relationship Closing Balance
1,088,148 (1,291,719) 8,682,527 (7,906,429) 9,770,975 (8,110,000) (300) (1,088,148) 5,765,952 (9,834,659) 288,243,974 (384,265,946) 300,102,317 (388,334,653) (43,240) (5,771,619)
INTEREST PAYABLE SBI International - Mauritius SBI - London State Bank of India ODD A/c SBI London - FC Line of credits 1,349 (2,738) 732 (-) 1,180 (-)
(1,380)
INTEREST EXPENSES SBI International - Mauritius State Bank of Hyderabad State Bank of Mysore State Bank of Patiala State Bank of Travancore State Bank of India ODD A/c SBI - London SBI Commercial Paper State Bank of India 5,184 (181,916) 21,935 (25,263) 50,474 (-) 178,507 (234,861)
27,370 (42,691) 53,932 (106,952) 11,833 (93,524) 17,611 (97,698) 135,175 (16,374)
SBI Capital Market Ltd SBICAP Securities Ltd
4,413 (-) 2 (-) 460 (499)
GIFTS & PRESENATAION State Bank of India
SBIGFL
46
Current Year (Rs. 000) (Previous years figures are given in brackets) Holding Company Fellow Associates Subsidiaries Key Mgt Personnel (KMP)
Sr. No.
RENT PAID State Bank of India 3,338 (-)
Salary paid to Deputed Staff State Bank of India 2,737 (147)
10
BANK CHARGES / PROCESSING FEES SBI International - Mauritius State Bank of India INR State Bank of Patalia INR State Bank of Mysore 2,658 (2,020) 2,995 (-) 1 (-) 363 (590) 2,497 (3,449)
11
Meeting Fees State Bank of India INVESTMENT SBI Mutual Fund Opening balance Investment made during the year Investment liquidqted during the year Closing Balance Profit of Investments
12
9,287,225 (19,661) 9,292,624 (19,672) (-) 5,399 (11)
13
REMUNERATION TO KEY MANAGERIAL PERSONS Mr. Sangeet Shukla Opening Balance Payable Remuneration for the year Closing Balance Payable Mr. Arvind Sonmale Opening Balance Payable Remuneration for the year Closing Balance Payable Mr. V K Gupta Opening Balance Payable Remuneration for the year Closing Balance Payable (-) 995 (-) (-) (-) 5,331 (4735) (-) (-) 3,538 (2493) (-)
SBIGFL
47
10
Estimated amount of contracts to be executed on capital account for - Tangible Assets Rs. Nil (Previous Year Rs. 56 thousand) - Intangible Assets Rs. 5900 thousand (Previous Year 2,284 thousand)
11
Managerial Remuneration Current Year Rs. 000 Salaries and Bonus * Contribution to PF & Other Fund Monetary Value of Perquisites Total Managerial Remuneration 5,539 301 4,024 9,864 Previous Year Rs. 000 4.885 296 2,047 7,228
12
Auditors Remuneration: Current Year Rs. 000 900 200 25 123 1,248 Previous Year Rs. 000 1,200 300 510 28 2,038
As Auditors In Other Capacity - As Tax Auditors - In any other manner (Including certification) Out of Pocket Expenses
13
Expenditure in Foreign Currency (On Accrual basis) Current Year Rs. 000 674 693 311 61,584 389 3,296 Previous Year Rs. 000 1,910 467 10 123,456 100 155 3,531
Correspondent Fees Travelling Membership and Subscription Interest on Short Term Loans Directors Sitting Fees Advertising Legal Fees & Expenses Others 14 Earnings in Foreign Currency:
Current Year Rs. 000 Income from Factoring - Discount Charges - Factoring Charges - Import Factoring Charges - Processing Charges Bank Interest Miscellaneous Income 164,353 17,888 3,504 11 5
Previous Year Rs. 000 262,200 53,493 252 15,664 269 8
SBIGFL
48
SBI Global Factors Ltd. 15 Details of Purchase and Sale of Investments during the year ended March 31, 2010 Mutual Funds Amount of Purchase (Rs. 000) 1,700,149 1,700,000 153,000,000 79,850,000 850,099 6,000,000 107,822,000 100,000 6,200,663 13,952,537 109,000,000 6,900,000 3,150,313 12,100,000 8,501,103 61,602,758 49,513,000 7,300,885 11,560,095 200,025 850,000 2,450,000 150,014 2,550,319 24,152,784 8,250,981 140,950,000 29,483,590 45,281,824 5,820,000 2,550,376 22,321,000 8,100,000 171,550,000 50,515,000 1,690,000 4,190,000 41,459,000 3,650,425 39,622,000 39,211,789 4,250,467 3,450,000 1,500,000 657,000 1,230,000 2,450,225 9,679,610 6,350,696 2,000,000 3,120,000 19,600,000 1,650,182 7,750,000 2,550,306 2,050,000 2,300,000 3,650,000 850,000 19,512,734 9,901,206 1,390,305,155 Quantity Purchased/Sold 125,566,937 152,040,422 10,595,415,469 7,803,326,675 84,027,591 559,077,791 9,870,244,482 7,346,891 429,086,510 1,121,825,192 9,376,057,554 566,721,502 272,299,389 641,752,377 433,992,173 3,395,485,568 4,502,227,283 689,654,527 869,923,862 16,571,972 74,632,654 210,258,614 12,615,652 220,200,333 1,719,193,982 654,475,687 7,692,029,945 2,027,175,816 2,761,860,019 480,516,346 209,956,445 1,592,153,546 621,698,143 7,828,624,021 3,534,345,367 75,536,691 310,462,968 1,904,807,857 2,970,595 3,151,533,177 3,172,078,156 343,402,388 172,085,380 78,767,943 33,277,676 87,508,551 209,437,379 512,225,986 528,608,461 143,227,893 1,892,520 11,834,432 1,606,679 5,819,104 220,808,271 154,285,989 1,563,145 2,494,927 84,768,582 327,080,732 8,157,304 92,698,623,519
SBIGFL
Name of Scheme ABN/Fortis Money Plus Inst.Growth ABN/Fortis Overnight -Inst.Plus Growth Birla Cash Plus Inst.Premium Growth BOB Pioneer Liquid IP Growth BOB Pioneer Treas.Advantage Fund -Inst.Growth Canbank Liquid plus Inst Growth Canbank Liquid Super Inst Growth Canbank MF Floating Rate STP Instt.Growth DBS Chola Freedom Income STP Inst.-Cum-Org DBS Chola Liquid Super Inst.Plan-Growth DWS Insta Cash Plus Fund-Super Inst.Plan Growth Fidelity MF Cash Fund Super I.P. Growth Fidelity Ultra Short Term Debt Super IP Growth HDFC Cash Management Fund savings Plan Growth HDFC Cash Mgt.- Treasy.Adv. Wholesale Growth HDFC MF Liquid Fund Premium-Growth IDFC Cash Fund Super IP Growth IDFC Money Manager -Treasury SIP Plan Growth ING Vysya Liquid Super Inst.Plan Growth ING Vysya Treasury Adv.Fund-Inst.Growth J.P.Morgan India Liquid Fund Growth Plan J.P.Morgan India Liquid Fund Super Inst .Growth Plan J.P.Morgan India Treas.Fund Super Inst- Growth J.P.Morgan India Treasury Fund Super Inst- Growth JM High Liquidity Fund Super Ins.Plan-Growth JM Money Manager Fund Super Plus Plan -Growth Kotak Liquid Institutional Prem.Growth LIC MF Floating Rate -Short Term Growth Plan LIC MF Liquid Fund-Growth Lotus MF-Liquid Inst.Premium Growth Lotus Ultra Short Term Fund.Inst.Growth Principal Cash Mangt.Inst.Premium -Growth Pru ICICI Liquid Inst. Cum-P31INP Pru ICICI Liquid Inst. Plus SIP Growth Reliance Floating Rate Fund - Growth Reliance Liquid Fund-Treasury Plan- Growth Reliance Liquidity Fund -Growth Reliance Liquidity Fund -Treasury Plan Inst.-Growth Reliance Money Manager Fund Int.-Growth Religare Liquid Fund Inst.Grwth Religare Liquid Fund.Super Inst.Growth Religare Ultra Short Term Fund.Inst.Growth SBI Magnum Insta Cash Fund-Cash Option SBI MF Inst.Cash Plan-Growth SBI MF Magnum Insta Cash Option SBI MF Premier Liquid Super IP Growth SBI-SHF-Ultra Short Term Fund-Int.Plan Growth Sundaram Money Fund Super IP Growth Sundaram Ultra ST Fund Super Inst.Growth Tata MF Floating Rate Short Term Inst.Growth Tata MF Liquid Super High Inv.Dividend Appreciation Tata MF Liquid Super High Invest.Plan Growth TATA Treasury Manager Super High Inv.Plan-Growth Templeton India TMA Super IP Growth Templeton India Ultra Short Bond Fund SIP Growth Templeton MF Floating Rate ST IP Growth UTI Liquid Cash Plan Institutional Growth UTI Liquid Inst.Cash Plan Growth UTI Money Market Fund Institutional Growth Plan UTI Money Market Fund Growth Plan UTI Treasury Advantage Fund IP- Growth Total
Note 1: No loss has been incurred on any sale during the year.
49
16
Schedule in terms of Paragraph 13 of Prudential Norms as per Notification No.DNBS. 193 DG(VL)- 2007 dated February 22, 2007 issued by Reserve Bank of India. Current Year LIABILITIES SIDE : Amount Outstanding Rs. 000 Amount Overdue Rs. 000 Previous Year Amount Amount Outstanding Overdue Rs. 000 Rs. 000
1 Loans and advances availed by the NBFCs inclusive of interest accrued thereon but not paid: (a) Debentures : - Secured - Unsecured (other than falling within the meaning of public deposits*) (b) Deferred Credits (c) Term Loans (d) Inter-corporate loans and borrowing (e) Commercial Paper (f) Other Loans (specify nature)
1,313,294 24,366,999 -
1,013,294 28,491,837 -
Amount Outstanding ASSETS SIDE: 2 Break-up of Loans and Advances including bills receivables [other than those included in (3) below: ] # (a) Secured (b)Unsecured (Excludes Advance Payment of Tax) Current Year Rs. 000 Previous Year Rs. 000
53,672
26,851
Break up of Leased Assets and stock on hire and hypothecation loans counting towards AFC activities (net of provision) (i) Lease assets including lease rentals under sundry debtors (a) Financial lease (b) Operating lease (ii) Stock on hire including hire charges under sundry debtors: (a) Assets on hire (b) Repossessed Assets (iii) Other loans counting towards AFC activities (a) Loans where assets have been repossessed (b) Loans other than (a) above # Debts Shown under Sundry Debtors have not been Considered 4 Break-up of Investments : Current Investments: 1. Quoted : (i) Shares : (a) Equity (b) Preference (ii) Debentures and Bonds (iii) Units of mutual funds (iv) Government Securities (v) Others (please specify) 2. Unquoted : (i) Shares : (a) Equity (b) Preference (ii) Debentures and Bonds (iii) Units of mutual funds
SBIGFL
50
Amount Outstanding ASSETS SIDE: Current Year Rs. 000 Previous Year Rs. 000
(iv) Government Securities (v) Others (please specify) Long Term investments : 1. Quoted : (i) Shares : (a) Equity (b) Preference (ii) Debentures and Bonds (iii) Units of mutual funds (iv) Government Securities (v) Others (please specify) 2. Unquoted : (i) Shares : (a) Equity (b) Preference (ii) Debentures and Bonds (iii) Units of mutual funds (iv) Government Securities (v) Others (please specify)
189,360 -
5 Borrower group-wise classification of all leased assets, stock-on-hire and loans and advances:
Amount net of provisions Category Secured Unsecured Total
1. Related Parties (a) Subsidiaries (b) Companies in the same group (c) Other related parties 2. Other than related parties (Previous Year) Total (Current year) Total (Previous year)
53,672 26,851 53,672 26,851
53,672 26,851 53,672 26,851
SBIGFL
51
Investor group-wise classification of all investments (current and long term) (both quoted and unquoted): Current Year Category Market Value Break-up or fair value or NAV Previous Year Book Value (net of Provisions)
Book Value Market Value (net of Break-up Provisions) or fair value or NAV -
1. Related Parties a) Subsidiaries b) Companies in the same group (c) Other related parties 2. Other than related parties Total
7 Other Information Current Year Rs. 000 Particulars (i) Gross Non Performing Assets (a) Related Party (B) Other than Related Parties (ii) Net Non-Performing Assets (a) Related Party (B) Other than Related Parties (iii) Assets acquired in satisfaction of debts Previous Year Rs. 000
6,351,920
3,132,211
5,068,119 -
2,505,769 -
17
Disclosures as per circular No. DNBS (PD). CC. No. 125/03.05.002/2008-2009 dated August 1, 2008, relating to guidelines for NBFC-ND-SI as regards to Capital Adequacy, Liquidity and disclosure norms. A) CRAR
Items
Items i) CRAR (%) ii) CRAR - Tier I Capital (%) iii) CRAR - Tier II Capital (%)
Current Year 19.88% 16.25% 3.63%
Previous Year 14.51% 11.60% 2.91%
SBIGFL
52
B) Exposure to Real Estate Sector Category a Direct Exposure* (i) Residential Mortgages - Lending fully secured by mortgages on residential property that is or will be occupied by the borrower or that is rented; (Individual housing loans up to Rs.15 lakh may be shown separately) (ii) Commercial Real Estate - Lending secured by mortgages on commercial real estates (office buildings, retail space, multipurpose commercial premises,multi-family residential buildings, multi-tenanted commercial premises, industrial or warehouse space, hotels, land acquisition, development and construction, etc.). Exposure would also include non-fund based (NFB) limits; (iii) Investments in Mortgage Backed Securities (MBS) and other securitised exposures a. Residential b. Commercial Real Estate b) Indirect Exposure Fund based and non-fund based exposures on National Housing Bank (NHB) and Housing Finance Companies (HFCs). * Exposure is unsecured C) Asset Liability Management Maturity pattern of certain items of assets and liabilities (Rs. in crore) 1 day to Over 30/31 1 month days to 2 (One months month) Liabilities Borrowings from Banks Market Borrowing Assets Advances Investments 1,792 350 1,721 2 690 Over 2 Over 3 months months to 3 to 6 months months Over 6 Over 1 Over 3 Over 5 months to 3 to 5 years to 1 years years year Total Current Year 116,250 (Rs. 000) Prvious Year 191,363
2 1 432 -
157 4 186 -
150 7 -
63 -
85 -
11 -
2,103 520 3,030 -
18. The previous years figures have been reworked, regrouped, rearranged and reclassified wherever necessary. Accordingly, amounts and other disclosures for the preceding year are included as an integral part of the current year financial statements and are to be read in relation to the amounts and other disclosures relating to the current year. Signatures to Schedules 1 to 18 forming part of the Accounts.
For and on behalf of the Board of Directors
O.P. Bhatt Chairman
Sangeet Shukla Executive Vice Chairman & CEO Amita Joshi Company Secretary
Mumbai Dated : April 27, 2010

SBIGFL
53
Balance Sheet In US $
Balance Sheet As At March 31, 2010
March 31, 2010 US $* SOURCES OF FUNDS Shareholders Funds Share Capital Reserves and Surplus Loan Funds Unsecured Loans Total APPLICATION OF FUNDS Fixed Assets Gross Block Less: Depreciation Net Block Capital Advances Investments Deferred Tax Asset Current Assets, Loans and Advances Sundry Debtors Cash and Bank Balances Other Current Assets Loans and Advances Less: Current Liabilities and Provisions Liabilities Provisions Net Current Assets Total * 1 US $ = Rs. 44.90 ** 1 US $ = Rs. 50.72 Note: Previous years figures have been regrouped / recast / reworked / rearranged / reclassified wherever necessary 674,794,254 5,350,200 212,895 7,444,509 687,801,859 4,516,058 355,756 4,871,814 682,930,045 699,728,486 594,900,769 64,848,383 264,708 1,133,537 661,147,397 5,980,343 4,724,901 10,705,244 650,442,153 657,290,556 6,479,220 3,587,305 2,891,915 11,359 2,903,274 4,217,372 9,677,795 4,777,721 2,123,640 2,654,081 58,636 2,712,717 4,135,686 571,628,018 699,728,486 580,662,914 657,290,556 34,356,437 93,744,031 128,100,468 21,124,389 55,503,253 76,627,642 US $ * March 31, 2009 US $**
SBIGFL
54
Profit And Loss Account In US $

Profit And Loss Account For The Year Ended March 31, 2010
Year Ended March 31, 2010 US $* INCOME Income from Factoring Interest Income Profit on Sale of Current Investments (Net) Other Income Total EXPENDITURE Employee Costs Operating and Other Expenses Interest and Financial Charges Depreciation / Amortisation Total PROFIT BEFORE TAXATION Provision for Taxation - Current Taxation - Excess Provision for Taxation for Earlier Years Written Back - Deferred Taxation - Wealth Tax - Fringe Benefits Tax PROFIT AFTER TAXATION Profit and Loss Account Balance Brought Forward from Previous Year Add : On account of amalgamation of erst while SBI Factors and Commercial and Services Pvt. Ltd. 20,748,664 PROFIT AVAILABLE FOR APPROPRIATION APPROPRIATIONS: Proposed Dividend - Equity - Preference Corporate Tax on Dividend Transfer to General Reserve Transfer to Reserve Fund Transfer to Contingency Reserve Profit and Loss Account Balance Carried to the Balance Sheet 211,581 35,969 293,163 3,352,717 18,320,980 22,214,410 3,830,560 187,303 682,827 1,559,306 3,118,612 18,170,644 27,549,252 22,214,410 11,956,191 27,549,252 20,525,947 222,717 11,956,191 2,402,516 5,456,570 (281,960) (4,239,243) 1,403 936,770 1,465,746 23,673,778 11,494,479 (3,440,674) 1,282 25,631 8,080,718 15,593,061 2,549,510 60,036,637 44,105,212 723,274 107,414,633 2,210,864 16,300,532 58,130,521 666,029 77,307,946 96,589,822 1,152,004 10,582,784 1,492,539 109,817,149 Year Ended March 31, 2009 US $** 90,918,218 2,566,936 6,485,509 1,011,061 100,981,724
Note : Previous years figures have been regrouped / recast / reworked / rearranged / reclassified wherever necessary
SBIGFL
55
SBI GLOBAL FACTORS LIMITED

Formerly Known as GLOBAL TRADE FINANCE LIMITED Additional information pursuant to Part IV of Schedule VI to the Companies Act, 1956, of India Balance Sheet Abstract and Companys General Business Profile I Registration Details Registration No. U 6 5 9 2 9 M H 2 0 0 1 P T C 1 3 1 2 0 3 1 1 0 3 1 0
State Code Balance Sheet Date II
3 1
Capital Raised during the Year (Amount in Rs. Thousands) Public Issue Rights Issue N I L N I L Bonus Issue N I L Private Placement 4 7 1 1 7 5
III
Position of Mobilisation and Deployment of Funds (Amount in Rs. Thousands) Total Liabilities Total Assets 3 1 6 3 6 5 5 3 3 1 6 3 6 5 5 3 Reserves and Surplus 4 2 0 9 1 0 7 Unsecured Loans 2 5 6 6 6 0 9 8 Investments 1 8 9 3 6 0 Deferred Tax Asset 4 3 4 5 3 3 Accumulated Losses N I L
Sources of Funds Paid-Up Capital 1 5 4 2 6 0 4 Secured Loans N I L Application of Funds Net Fixed Assets 1 3 0 3 5 7 Net Current Assets 3 0 6 6 3 5 5 9 Miscellaneous Expenditure N I L IV
Performance of Company (Amount in Rs. Thousands) Turnover and Other Income Total Expenditure 4 9 3 0 7 9 0 4 8 2 2 9 1 7 + Profit/Loss Before Tax 1 0 7 8 7 3 + Profit / Loss After Tax 6 5 8 1 2
(Please tick appropriate box + for Profit, - for Loss) + - Earnings per Share in Rs. Dividend Rate % 0 . 3 8 0 0 . 0 0 (Please tick appropriate box + for Earnings, - for Loss) V Generic Names of three Principal Products/Services of the Company (as per monetary terms) Item Code No.(ITC Code) Product Description N A F A C T O R I N G O F
D E B T S For and on behalf of the Board of Directors O. P. Bhatt Chairman Mumbai Dated: April 27, 2010
SBIGFL
Sangeet Shukla Executive Vice Chairman & CEO
Amita Joshi Company Secretary
56
Registered Office
Mumbai 6th Floor, The Metropolitan, Bandra-Kurla Complex, Bandra (E), Mumbai - 400 051 Tel: +91-22- 30440300 Fax: +91-22-6694 6098/99
Coimbatore 3rd Floor, chamber Towers, 8/732 Avanashi Road,Coimbatore - 641 018 Tel: +91-422 2222001 Fax: +91-422 2222279
Regional Offices
Ahmedabad 401, Sakar II, Ellis bridge, Ahmedabad - 380 006 Tel: + 91-79-4006 8501/ 02/03 Fax: +91-79-4006 8504 Bangalore S 821/822, 8th Floor Manipal Centre, 47 Dickenson Road, Bangalore - 560 042 Tel: +91-80-30569749 Fax: +91-80-40923761/25583619 Chennai 2nd Floor, Karumuthu Centre,634-Anna Salai, Nandanam, Chennai - 600 035 Tel: +91-44-2434 1201/02/03 Fax: +91-44-2434 1204 Hyderabad S-2, ANR Centre,Road # 1, Banjara Hills,Hyderabad - 500 034 Tel: +91-40-3064 8460/61 Fax: +91-40-3064 8466 Kolkata Surabhi Merlin, 8/1/2 Loudon Street, Kolkata - 700 017 Tel: +91-33-2289 6366 / 67 / 68 Fax: +91-33-2289 6383 New Delhi 906-907 Narain Manzil, Barakhamba Road, Connaught Place, New Delhi - 110 001 Tel: +91-11-4160 8581/82/83 Fax: +91-11-4160 8580
Hubli Ground Floor, T B Revenkar Comforts,Travelers Bunglow Road, Near Court Circle, Hubli - 580 029 Tel: +91-836 - 2353423/25 Fax: +91-836 2353424 Jaipur 1st Floor, Silver Square, C-18,Bhagwan Das Road, C-Scheme, Jaipur - 302 001 Tel: +91-141-4002178 / 79 / 80 Fax: +91-141-4002170 Kochi 41/418 E, 4th Floor, Chicago Plaza, Rajaji Road, Ernakulam - 682 035 Tel: +91-484-2378431/32 Fax: +91-484-2378430 Visakhapatnam Ground Floor, Narayana Towers, 43-9-16/13, Diamond Park Extension, Beside Trinetra Supermarket, Railway New Colony, Main Road, Visakhapatnam - 530 016 Tel: +91-891 - 2716179/80 Fax: +91-891 2716178 Pune Office No.103, 1st Floor, Renaissance 1277, Jangli Maharaj Rd., Pune - 411 004. Tel: 020 25536777 Fax: 020 25536700 Ludhiana BXXXI-14627, Gandhi Nagar, G.T. Road, Near Dholewal Bridge, Ludhiana-141 003 Tel: 0161-2545626 Fax: 0161-2544426 Indore LG-1&2, Starlit Towers, YN Road, Indore 452 003 Tel: 0731 4280025 Fax: 0731 4280023
Satellite Offices
Chandigarh SCO 51-52, Sector 8C, Madhya Marg, Chandigarh - 160 018 Tel: +91-172-4668752 Fax: +91-172-4668751
SBIGFL
57
Share MSMEs SBIGFL Accounts Share of MSMEs in number of SBIGFLs Client Accounts as on March 31, 2010
MSME Non-MSME
43% 57%
SBIGFL Share SBIGFLs International Factoring Market Share
SBIGFL Competitors
30%
70%
According to FCI figures published for CY 2009
SBIGFL Share SBIGFLs Domestic Factoring Market Share
SBIGFL Competitors
20 %
80 %
According to FCI figures published for CY 2009
SBIGFL
58

SBI Annual Report 09 10

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SBI Global Factors Ltd.

Annual Report 2009-2010

SBI Global Factors Ltd.

List of Directors List Director ectors

* as on 10th June 2010

Annual Report 2009-2010

SBI Global Factors Ltd.

Board of Directors Board Director ectors

Shri O.P. Bhatt Chairman

Shri R. Sridharan Director

Smt. Bharati Rao Director

Shri V. Kannan Director

Shri B.K. Vatsaraj Director

Shri Y. Vijayanand Director

Smt. Bhama Krishnamurthy Director

Shri S. Rajendran Director

Shri Ashwin Ankhad Director

Shri Sangeet Shukla (Executive Vice Chairman & C.E.O.)

Annual Report 2009-2010

SBI Global Factors Ltd.

Annual Report 2009-2010

SBI Global Factors Ltd.

Directors Report Director ectors

Summary of Financial Results

Changes And Developments

Annual Report 2009-2010

SBI Global Factors Ltd.

Annual Report 2009-2010

SBI Global Factors Ltd.

Annual Report 2009-2010

SBI Global Factors Ltd.

Name of the Shareholder

Internal Audit and Limited Review of Quarterly Accounts

Annual Report 2009-2010

SBI Global Factors Ltd.

Corporate Governance Report

Management Discussions & Analysis Report

Annual Report 2009-2010

SBI Global Factors Ltd.

Directors Responsibility Statement

Annual Report 2009-2010

SBI Global Factors Ltd.

Corporate Governance Report Corporate

Annual Report 2009-2010

SBI Global Factors Ltd.

Executive Committee of the Board:

Annual Report 2009-2010

SBI Global Factors Ltd.

General Body Meetings:

General Shareholder Information:

Annual Report 2009-2010

SBI Global Factors Ltd.

Management Discussion and Analysis Discussion scuss Analys

Indian Economic Scenario: Resilience of the Indian Economy

Interest Rate Scenario:

Merger of SBIF with GTF:

Annual Report 2009-2010

SBI Global Factors Ltd.

Outlook for the Factoring Services:

Performance of the Company:

Annual Report 2009-2010

SBI Global Factors Ltd.

Auditors Auditors Report

For Contractor, Nayak & KIshnadwala Chartered Accountants