10. Related party transactions 

1.  Related Party Transactions in 2011 (See note of Financial
    Statements, Section 35: Related Party Transactions)

During the years ended 31 December 2011, the Company and its
subsidiaries had significant business transactions with related parties.
Such transactions, which are summarised below, arose in the ordinary
course of business and were concluded on commercial terms and bases
agreed upon between the Company, the subsidiaries and those related
parties.

Transactions with related parties

+--------------------------+------------+------+---------------------+
| Related parties          | Tr         | Thou | Pricing Policies    |
|                          | ansactions | sand |                     |
|                          |            |      |                     |
|                          |            | Baht |                     |
+--------------------------+------------+------+---------------------+
| 1.  KGI Asia Limited     | -          | 73   | At normal rate      |
|                          | Brokerage  |      | charged to other    |
| (KGI Group is a major    | fee income |      | clients, in         |
| shareholder of KGI Asia  |            |      | accordance with     |
| Limited and of the       |            |      | SET’s and SEC’s     |
| Company)                 |            |      | notification        |
+--------------------------+------------+------+---------------------+
|                          | -          | 250  | No interest charged |
|                          | Securities |      | same as other       |
|                          | and        |      | clients.            |
|                          | d          |      |                     |
|                          | erivatives |      |                     |
|                          | business   |      |                     |
|                          | r          |      |                     |
|                          | eceivables |      |                     |
+--------------------------+------------+------+---------------------+
| 2.  KGI Securities       | -          | 906  | At normal rate      |
|     Company Limited      | Brokerage  |      | charged to other    |
|                          | fee income |      | clients, in         |
|   (KGI Group is a major  |            |      | accordance with     |
|   shareholder of KGI     |            |      | SET’s and SEC’s     |
|   Securities Company     |            |      | notification        |
|   Limited and of the     |            |      |                     |
|   Company)               |            |      |                     |
+--------------------------+------------+------+---------------------+
|                          | IT         | 66   | Service fee was     |
|                          | consulting |      | calculated from     |
|                          | fee        |      | cost method plus 4  |
|                          |            |      | percent margin by   |
|                          |            |      | calculating from    |
|                          |            |      | actual working      |
|                          |            |      | hour.               |
+--------------------------+------------+------+---------------------+
|                          | Advances   | 192  | No interest charged |
|                          | to related |      | same as other       |
|                          | company    |      | clients.            |
+--------------------------+------------+------+---------------------+
| 3.  KGI Securities (Hong | -          | 57   | At normal rate      |
|     Kong) Limited        | Brokerage  |      | charged to other    |
|                          | fee income |      | clients, in         |
| (KGI Group is a major    |            |      | accordance with     |
| shareholder of KGI       |            |      | SET’s and SEC’s     |
| Securities (Hong Kong)   |            |      | notification        |
| Limited and of the       |            |      |                     |
| Company)                 |            |      |                     |
+--------------------------+------------+------+---------------------+
| 4. KGI Finance Limited   | -          | 1    | At normal rate      |
|                          | Brokerage  | ,821 | charged to other    |
| (KGI Group is a major    | fee income |      | clients, in         |
| shareholder of KGI       |            |      | accordance with     |
| Finance Limited and of   |            |      | SET’s and SEC’s     |
| the Company)             |            |      | notification        |
+--------------------------+------------+------+---------------------+
|                          | -          | 519  | Borrowing fee at    |
|                          | Securities |      | percentage of value |
|                          | borrowing  |      | of borrowed         |
|                          | fee income |      | securities and      |
|                          |            |      | borrowing period,   |
|                          |            |      | same as other       |
|                          |            |      | clients.            |
+--------------------------+------------+------+---------------------+
| 5. Richpoint Company     | -          | 40   | Baht 15 of every    |
| Limited                  | Custodian  |      | Baht 1 million on   |
|                          | fee income |      | daily securities    |
| (it is owned by the KGI  |            |      | outstanding value,  |
| Group and it is a major  |            |      | same as other       |
| shareholders of the      |            |      | clients.            |
| Company)                 |            |      |                     |
+--------------------------+------------+------+---------------------+
|                          | - Accrued  | 8    | No interest charged |
|                          | service    |      | same as other       |
|                          | fees       |      | clients.            |
+--------------------------+------------+------+---------------------+

Transaction of subsidiary companies with related parties

+--------------------------+------------+------+---------------------+
| Related parties          | Tr         | Thou | Pricing Policies    |
|                          | ansactions | sand |                     |
|                          |            |      |                     |
|                          |            | Baht |                     |
+--------------------------+------------+------+---------------------+
| 1. KGI Hong Kong Limited | Management | 550  | Service fee was     |
|                          | fee        |      | calculated from     |
| (KGI Group is a major    |            |      | cost method plus 10 |
| shareholder of KGI Hong  |            |      | percent margin by   |
| Kong Limited and of the  |            |      | calculating from    |
| Company)                 |            |      | actual working hour |
|                          |            |      | and negotiation     |
+--------------------------+------------+------+---------------------+

Transactions with management and directors

+---------------------------+------------+------+--------------------+
| Related parties           | Tr         | Thou | Pricing Policies   |
|                           | ansactions | sand |                    |
|                           |            |      |                    |
|                           |            | Baht |                    |
+---------------------------+------------+------+--------------------+
| 1. The Company’s          | -          | 43   | At normal rate     |
| management and directors  | Brokerage  |      | charged to other   |
|                           | fee income |      | clients, in        |
|                           |            |      | accordance with    |
|                           |            |      | SET’s and SEC’s    |
|                           |            |      | notification       |
+---------------------------+------------+------+--------------------+
| 2. The Company’s          | -          | 12   | Directors          |
| directors                 | Directors  | ,126 | remuneration as    |
|                           | re         |      | per its            |
|                           | muneration |      | shareholders’      |
|                           |            |      | approval           |
+---------------------------+------------+------+--------------------+
| 3. Directors of One Asset | -          | 125  | Directors          |
| Management Ltd            | Directors  |      | remuneration as    |
|                           | re         |      | per its            |
| (The Company’s subsidiary | muneration |      | shareholders’      |
| which is 98% held by the  |            |      | approval           |
| Company)                  |            |      |                    |
+---------------------------+------------+------+--------------------+
| 4. Directors of KGI       | -          | 2    | Directors          |
| Securities (Thailand)     | Directors  | ,450 | remuneration as    |
| International Holdings    | re         |      | per its            |
| Limited                   | muneration |      | shareholders’      |
|                           |            |      | approval           |
| (The Company’s subsidiary |            |      |                    |
| which is 100% held by the |            |      |                    |
| Company)                  |            |      |                    |
+---------------------------+------------+------+--------------------+
| 5. Directors of KGI       | -          | 2    | Directors          |
| (Thailand) Holding        | Directors  | ,450 | remuneration as    |
| Limited                   | re         |      | per its            |
|                           | muneration |      | shareholders’      |
| (The Company’s subsidiary |            |      | approval           |
| which is 100% held by the |            |      |                    |
| Company)                  |            |      |                    |
+---------------------------+------------+------+--------------------+

Transactions with related person

+---------------------------+------------+------+---------------------+
| Related parties           | Tr         | Thou | Pricing Policies    |
|                           | ansactions | sand |                     |
|                           |            |      |                     |
|                           |            | Baht |                     |
+---------------------------+------------+------+---------------------+
| 1. A related person       | - Advisory | 1    |   The Board of      |
|                           | fee        | ,800 |   Directors’        |
| (The family of the        |            |      |   meeting date 27   |
| related person is a major |            |      |   August 2009 has   |
| shareholder of KGI        |            |      |   approved the      |
| Securities Company        |            |      |   Advisory fee of   |
| Limited)                  |            |      |   Baht 150,000 per  |
|                           |            |      |   month or Baht     |
|                           |            |      |   1.80 million per  |
|                           |            |      |   year, the service |
|                           |            |      |   fee was           |
|                           |            |      |   negotiated based  |
|                           |            |      |   on prevailing     |
|                           |            |      |   market rates, and |
|                           |            |      |   comparison with   |
|                           |            |      |   other advisors.   |
+---------------------------+------------+------+---------------------+

Necessity of and reason for transactions 

  In 2011, the Company’s related party transactions, both commission fee
  and brokerage fee, were general business terms which were approved in
  principle by the Board. For other related transactions, the Company
  has process of approval and disclosure in compliance with the
  regulation, the Audit Committee and the Board of Directors has
  considered and agreed that these transactions were necessary and
  reasonable and served the benefit of the Company and shareholders.

  10.3 Process for approval of related party transactions

  The Company certifies that future related party transactions shall be
  reasonable and serve the benefit of the Company and Shareholders. The
  process for approval by the Audit Committee, Board and/or shareholders
  will be carried out in compliance with the notifications, regulations,
  orders or requirements of the SEC/SET, which include related party
  transactions and acquisitions or disposal of assets of listed
  companies or subsidiaries. Connected executives or shareholders will
  not be involved in that agenda.