SEC Form 20-IS - iRemit Global Remittance

(a) Delivery fees earned from clients of associates are as follows:
2011 2010 2009
Hwa Kung Hong & Co., Ltd. (HKHCL) P=46,127,251 P=33,202,567 P=25,364,567
IRemit Singapore Pte Ltd (ISPL) 24,463,777 25,080,948 27,016,303
P=70,591,028 P=58,283,515 P=52,380,870
(b) The Parent Company, as Lessor, entered into four (4) Lease Agreements (please refer to Properties),
covering its occupancy of its offices at the 25 th , 26 th and 27 th floors of the Discovery Center, at No. 25 ADB
Avenue, Ortigas Center, Pasig City, with Oakridge Properties, Inc., a related party by virtue of JTKC
Equities, Inc.’s ownership of the Discovery Leisure Company, Inc. which in turn owns Oakridge
Properties, Inc. Rent expense amounted to PHP 9.96 million, PHP 9.25 million and PHP 8.17 million in
2011, 2010, and 2009, respectively.
(c) I-Remit, Inc. has office sharing arrangements with Surewell Equities Pte. Ltd. in Singapore for an initial
term of two (2) years. Mr. Bansan C. Choa, Chairman and Chief Executive Officer, is a shareholder in
said company. Rent expense amounted to PHP 0.90 million in 2011.
(d) The Parent Company maintains deposit accounts with the Sterling Bank of Asia, Inc. (A Savings Bank)
amounting to PHP118.6 million and PHP129.7 million as of December 31, 2011 and 2010, respectively.
These deposits earned PHP0.43 million, PHP1.12 million and PHP1.16 million interest income in 2011,
2010 and 2009, respectively. In 2011 and 2010, the Company has funded its retirement plan amounting
to PHP 6.9 million and PHP 5.2 million, respectively, and maintained with Sterling Bank of Asia, Inc. (A
Savings Bank). The said bank’s majority shareholders are: JTKC Equities, Inc., Surewell Equities, Inc.
and Star Equities Inc.
In the normal course of doing business, there were occasions when the stockholders would be advancing
funds for working capital requirements of the Company. Reciprocally, there would also be occasions when the
Company would have excess funds and would employ these to advance funds to some of its affiliates, payable
on demand. In prior years, advances were made to foreign offices which, as these still in the process of
starting their commercial operations, were then owned by the stockholders or associates or companies owned
by the stockholders. The funds were then used either as working capital, to maintain cash balances in bank
accounts or for provision of cash bonds. Presently, these foreign offices are either subsidiaries or affiliates of
I-Remit, Inc.
Further to the Company’s usual course of business, it also advances funds to its subsidiaries, associates, and
affiliates. These are accounts receivable from subsidiaries, associates, and affiliates pertaining to remittance
transactions. These also consist of advances made to subsidiaries, associates, and affiliates for working
capital to maintain cash balances in bank accounts and to cover other financial and operating requirements.
The receivables are usually settled on the next banking day. On the other hand, advances made to cover
financial and operating requirements are due on demand.
In addition to the related information disclosed elsewhere in the consolidated financial statements, the
following are the yearend balances in respect of transactions with related parties which were carried in terms
that prevail in arm’s length transactions during the year:
2011 2010
Due from related parties - Associates:
IRemit Singapore Pte Ltd (ISPL) P=16,034,603 P=16,104,921
Hwa Kung Hong & Co., Ltd. (HKHCL) 8,986,123 10,888,056
P=25,020,726 P=26,992,977
Due to related parties – Directors: P=- P=1,431,156
Advances to associates pertain to unpaid delivery fees. These are non-interest bearing and are due on
demand.
Advances to directors are non-interest bearing and are due on demand.
As of December 31, 2011 and 2010, no provision for credit losses has been recognized for the amounts due
from related parties.
In 2010, the Parent Company recognized dividend income amounting PHP0.6 million from dividends declared
by IRemit Singapore Pte Ltd. In 2009, the Parent Company’s dividend income includes dividends declared by
IRemit Singapore Pte Ltd (PHP14.40 million), International Remittance (Canada) Ltd. (PHP9.54 million),
Worldwide Exchange Pty Ltd (PHP3.93 million), I-Remit Australia Pty Ltd (PHP3.30 million) and Power Star
Asia Group Limited (PHP3.07 million).
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