Annual report pursuant to Section 13 and 15(d)

3. Revision of Financial Statement

v3.19.2
3. Revision of Financial Statement
12 Months Ended
Mar. 31, 2019
Accounting Changes and Error Corrections [Abstract]  
Revision of Financial Statement

When preparing the consolidated financial statements for the year ended March 31, 2019, management determined that certain amounts included in the Company’s March 31, 2018, consolidated financial statements 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 in May 2018, and 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 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 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 Consolidated Statement of Operations and Statements of Other Comprehensive Income for the year ended March 31, 2018 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   48   2,410
Intangible assets, net   -   5,692   5,692
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 obligations   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 year ended  March 31, 2018
STATEMENTS OF OPERATIONS AND STATEMENTS OF OTHER COMPREHENSIVE INCOME (RECAST)  

 

As previously reported

  Recast   As recasted
             
Revenue:            
Fee and commission income   $ 10,796   $ 1,378   $ 12,174
Net gain on trading securities   33,746   481   34,227
Interest income   8,184   651   8,835
Net gain on derivatives   643   -   643
Net gain on sale of fixed assets   5   (5)   -
Net gain on foreign exchange operations   1,850   28   1,878
             
TOTAL REVENUE, NET   55,224   2,533   57,757
             
Expense:            
Interest expense   14,244   491    14,735
Fee and commission expense   2,066   222   2,288
Operating expense   18,927   2,773    21,700
Provision for impairment losses   -   423   423
Other (income)/expense, net   275   (279)   (4)
             
TOTAL EXPENSE   35,512   3,630   39,142
             
NET INCOME BEFORE INCOME TAX   19,712   (1,097)   18,615
             
Income tax expense   (479)   61   (418)
             
NET INCOME   $ 19,233   $ (1,036)   $ 18,197
             
OTHER COMPREHENSIVE INCOME            
Changes in unrealized gain on investments available-for-sale, net of tax effect   -   (76)   (76)
Reclassification adjustment relating to available-for-sale investments disposed of in the period, net of tax effect   -   54   54
Foreign currency translation adjustments, net of tax   (457)   (141)   (598)
             
COMPREHENSIVE INCOME   $ 18,776   $ (1,199)   $ 17,577