Quarterly report pursuant to Section 13 or 15(d)

Revision of Financial Statement

v3.10.0.1
Revision of Financial Statement
 9 Months Ended
Dec. 31, 2018
Accounting Changes and Error Corrections [Abstract]  
Revision of Financial Statement

When preparing the condensed consolidated financial statements as of December 31, 2018, and for the three and nine months ended December 31, 2018, management determined that certain amounts included in the Company’s consolidated financial statements as of March 31, 2018, and for the three and nine months ended December 31, 2017, required revision, due to the closing of the acquisition of Freedom RU on June 29, 2017, the closing of the acquisition of Freedom CY on November 1, 2017, and the completion of the mergers of Nettrader LLC (“Nettrader”) in May 2018, and Asyl Invest JSC (“Asyl”) in April 2018, which were deemed to be entities under common control with the Company.

 

Certain reclassifications also have been made to the prior year’s consolidated financial statements to enhance comparability with the current year’s condensed consolidated financial statements following the increase in intangible assets of the Company related to acquisition of the Tradernet trading platform. As a result, certain line items have been amended in the Condensed Consolidated Balance Sheets. Comparative figures have been adjusted to conform to the current period’s presentation.

 

The previously issued Consolidated Balance Sheet as of March 31, 2018, and Condensed Consolidated Statement of Operations and Statements of Other Comprehensive Income/(Loss) for the three and nine months ended December 31, 2017 have been revised as follows:

 

    As of March 31, 2018  
 BALANCE SHEETS (RECAST)   As previously reported     Recast     As recasted  
                   
ASSETS                  
                   
Cash and cash equivalents   $ 64,531     $ 1,200     $ 65,731  
Restricted cash     13,671       8,291       21,962  
Trading securities     212,319       276       212,595  
Available-for-sale securities, at fair value     2       238       240  
Brokerage and other receivables, net     21,109       3,776       24,885  
Loans issued     8,754       -       8,754  
Deferred tax assets     1,046       (274 )     772  
Fixed assets, net     2,362       209       2,571  
Intangible assets, net     -       5,531       5,531  
Goodwill     1,798       1,490       3,288  
Other assets, net     4,494       79       4,573  
TOTAL ASSETS   $ 330,086     $ 20,816     $ 350,902  
                         
LIABILITIES AND STOCKHOLDERS’ EQUITY                        
                         
Securities sold, not yet purchased - at fair value   $ 1,135     $ -     $ 1,135  
Loans received     7,143       -       7,143  
Debt securities issued     10,840       382       11,222  
Customer liabilities     21,855       8,817       30,672  
Trade payables     8,998       15       9,013  
Deferred distribution payments     8,534       -       8,534  
Securities repurchase agreement obligation     154,775       -       154,775  
Deferred income tax liabilities     387       (387 )     -  
Other liabilities     1,319       57       1,376  
TOTAL LIABILITIES     214,986       8,884       223,870  
                         
STOCKHOLDERS’ EQUITY                        
                         
Preferred stock     -       -       -  
Common stock     58       -       58  
Additional paid in capital     87,049       13,131       100,180  
Retained earnings     35,387       (1,036 )     34,351  
Accumulated other comprehensive loss     (7,394 )     (163 )     (7,557 )
TOTAL STOCKHOLDERS’ EQUITY     115,100       11,932       127,032  
                         
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY   $ 330,086     $ 20,816     $ 350,902  

 

 

    For the three months ended December 31, 2017  
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND STATEMENTS OF OTHER COMPREHENSIVE INCOME/(LOSS) (RECAST)   As previously reported     Recast     As recasted  
                   
Revenue:                  
Fee and commission income   $ 1,999     $ 455     $ 2,454  
Net gain/(loss) on trading securities     (8,318 )     210       (8,108 )
Interest income     2,853       138       2,991  
Net gain on derivatives     867       -       867  
Net gain/(loss) on sale of fixed assets     16       (16 )     -  
Net gain/(loss) on foreign exchange operations     424       (58 )     366  
                         
TOTAL REVENUE, NET     (2,159 )     729       (1,430 )
                         
Expense:                        
Interest expense     4,487       123       4,610  
Fee and commission expense     795       60       855  
Operating expense     5,983       713       6,696  
Other expense, net     105       185       290  
                         
TOTAL EXPENSE     11,370       1,081       12,451  
                         
NET LOSS BEFORE INCOME TAX     (13,529 )     (352 )     (13,881 )
                         
Income tax benefit     403       10       413  
                         
NET LOSS   $ (13,126)   $ (342)   $ (13,468)
                         
OTHER COMPREHENSIVE INCOME/(LOSS)                        

Change in unrealized gain on investments available-for-sale, net

of tax effect

   $ -     $ (168 )   $ (168 )
Foreign currency translation adjustments, net of tax effect     1,529       1,602       3,131  
                         
COMPREHENSIVE INCOME/(LOSS)   $ (11,597)     $ 1,092     $ (10,505)

 

 

    For the nine months ended December 31, 2017  
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND STATEMENTS OF OTHER COMPREHENSIVE INCOME (RECAST)   As previously reported     Recast     As recasted  
                   
Revenue:                  
Fee and commission income   $ 6,412     $ 1,114     $ 7,526  
Net gain on trading securities     30,825       583       31,408  
Interest income     6,442       336       6,778  
Net gain on derivatives     687       -       687  
Net gain on sale of fixed assets     8       (8 )     -  
Net gain on foreign exchange operations     1,957       32       1,989  
                         
TOTAL REVENUE, NET     46,331       2,057       48,388  
                         
Expense:                        
Interest expense     9,499       326       9,825  
Fee and commission expense     1,474       173       1,647  
Operating expense     12,113       2,036       14,149  
Other expense, net     131       150       281  
                         
TOTAL EXPENSE     23,217       2,685       25,902  
                         
NET INCOME BEFORE INCOME TAX     23,114       (628 )     22,486  
                         
Income tax expense     (584 )     32       (552 )
                         
NET INCOME   $ 22,530     $ (596 )   $ 21,934  
                         
OTHER COMPREHENSIVE INCOME                        
Change in unrealized gain on investments available-for-sale, net of tax effect   $ -     $ (121 )   $ (121 )
Foreign currency translation adjustments, net of tax effect     (2,809 )     (441 )     (3,250 )
                         
COMPREHENSIVE INCOME   $ 19,721     $ (1,158 )   $ 18,563