CGS : ANNUAL REPORT 2015 by Phantipa Kwanmuang

1. Policy and an overview of the business. 1.1 Vision Missio and Gold in Business Operation Vision To be financial and investment service leader and to be known as professional and integrity business provider. Mission To achieve the Company’s vision, the Company aims to be a securities brokerage firm fully integrated professional services in Thailand and to become the best service provider. In addition, the Company intends to serve and offer innovative products and services to meet clients’ needs, and manage business in comply with good corporate governance in order to build confidence to clients and investors as well as support the development of employees’ potential for excellent service to clients. Goal in Business Operation To be a securities brokerage firm with Leading securities companies The Company plans to join financial exhibitions for trade show and hold a seminar to educate investors and interested people both in Bangkok and provincial areas, especially when the SET launches new products and services e.g. gold futures, derivative warrants, etc. to stimulate new comers to invest in the SET. This will not only expand the Company’s clients base, but also maintain its existing one. In addition, the Company plans to develop a structure of information technology to be more effective and better serve the clients. Also, the Company has policy to maintain human resource to work with the Company in the long run. To be a securities brokerage firm with fully integrated professional services The Company plans to develop the effectiveness and stability of securities and derivatives trading systems in order to support trading capacity, to offer more products and services to meet clients’ needs that enable them to choose appropriate alternatives for investment and manage portfolio efficiently, and to train employees to raise their potential of advising and serving clients with quality. Moreover, the Company plans to restructure the internal management with an aim for fast service and less Complicate procedures. To maintain revenue and profit levels continuously, and seek business opportunity amid market fluctuations The Company will manage efficient resources and utilize them in order to reduces operating costs while generates profit to shareholders. In addition, the Company will seek channels for business expansion and investment with acceptable risks and appropriate returns to reduce a reliance on revenue from securities brokerage business and maintain the company’s revenue base amid securities business affected by external factors such as politics, economy and natural disasters. To operate business regarding stakeholders The Company will operate business based on virtues, morality and integrity. These principles will benefit all groups of stakeholders such as shareholders, clients, investors, employees and the capital market. In addition, the Company will give support to organizations, educational institutions, and public and private companies with the purpose of development of capital market in order to attract foreign investors. 1.2 History and Major Developments Year Major Developments 1966 Established "Adkinson to the Enterprise Company Limited" 1974 Assigned as “Broker No. 3” of the SET 1979 Change its name to "Adkinson Securities Company Limited" 1991 Received approval from the SET to list its common shares in the SET 1993 The common shares of the company were approved as listed securities in the SET 1994 Converted to a public company and raised its registered capital from Baht 200 million to Baht 600 million

8 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

Year 1997 1999 2002

2003 2004 2006

2007

2008

2009

Major Developments Changed its foreign holding ownership regulation from 25% to 49% of outstanding shares and continued increasing its market capitalization for business expansion purposes Increased the registered capital to Baht 1,785 million for the future conversion of its tranche 1 and tranche 2 warrants which expired on the 14 December 2001 and 2002 respectively Increased the registered capital to Baht 2,414.16 million for financing the purchase of Indosuez W.I. Carr Securities (Thailand) Limited of 99.99% which was purchased on 22 April 2002. Indosuez W.I. Carr Securities (Thailand) Limited was later called IB Securities and was known as Apex Securuties Increased the registered capital to Baht 4,916.51 million for the future expansion of warrant tranche 3 and tranche 4 which expired on 16 January 2004 and 2006 respectively The Board of director elected Mr.Udom Vichayabhai as chairman of the board and elected Mrs.Apar Kewkacha as Chief Executive Officer of the Company Increased paid up capital to Baht 3,223.10 million from the conversion of warrant tranche 3 - Increased paid up capital to Baht 4,195.89 million from the conversion of warrant tranche 4 Changed the board of director structure resulting with the appointment of Professor Prayoon Chindapradist as Chairman and Mr. Sadawut Taechaubol as Chief Executive Officer and President - Merged and closed the operations of 23 branches - Merged and closed the operations of 4 branches and one additional branch was opened. - Transferred its capital reserve of Baht 17,602 and premium on share capital of Baht 813.67 to compensate retained loss as at 31 December 2006 of Baht 901.67. The Companyâ&#x20AC;&#x2122;s retained loss was Baht 87.99 million after the compensation - Changed in par value from Baht 10 per share to Baht 1 per share - APEX Securities made a capital reduction from Baht 482.05 to Baht 120.51. This was conducted in preparation for the sales of the APEX license - Adkinson Securities sold and transferred all of its shares in Apex Securities to Merrill Lynch Holdings (Mauritius) - Granted a TFEX license to undertake the derivatives agent from the SEC - The Ministry of Finance had approved the securities business license type Kor No: Lor Kor -0002-01.This license permits the Company to engage in all categories of securities businesses - SEC approved the Company to conduct the securities underwriting - Due to further branch restructure, the Company merged and closed the operations to 4 branches in 2008 - Increased its investment proportion in MFC Asset Management Plc. to 22.5 %of its registered capital, which MFC became the associated company - 16 new branches were opened and 3 branches were closed and merged - Decreased of the registered capital from Baht 4,916.51 million to Baht 4,195.89 million by canceling the 720.62 unissued ordinary shares - Decreased of the Company's registered and paid-up capital from Baht 4,195.89 million to Baht 4,038.14 million by decreasing the 157.75 million shares in order to compensate the Company's accumulated losses as at 30 September 2008 of Baht 157.75 million - Decrease of the Company's registered and paid-up capital from Baht 4,038.14 million to Baht 2,300.00 million by decreasing the 1,738.14 shares in order to refund Baht 1,738.14 million to the Company's shareholders - The Company changed its name from Adkinson Securities PLC to Country Group Securities PCL. - Decreased its registered and paid-up capital from Baht 2,300.00 million to Baht 1,866.37 million by decreasing the 433.63 million shares in order to compensate the Company's accumulated losses of Baht 433.63 million as at 30

9 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

Year

2010

2011

2012

2013

Major Developments June 2009 - Issued and offered new ordinary shares not exceeding 466.59 million shares, at a par value of Baht 1.00 per share to the existing shareholders in pro rata basis, by ratio of 4 existing ordinary shares to 1 new ordinary share at the price of Baht 1.30 per share - Issued and offered Warrants to purchase the Companyâ&#x20AC;&#x2122;s ordinary shares No.5 in the amount not exceeding than Baht 466.59 million units to the existing shareholders who subscribe for new ordinary shares and were allocated at the ratio of 1 new ordinary share per 1 unit of Warrant for free. 1 unit of Warrant was entitled to purchase 1 new ordinary share at the price of Baht 1.50 per share - The Company issued and offered Warrants to purchase the Companyâ&#x20AC;&#x2122;s ordinary shares under ESOP Program No.1 in the amount not exceeding 350.00 million units to directors, management, employees, and/or advisors of the company for free. 1 unit of Warrant was entitled to purchase 1 new ordinary share at the price of Baht 1.50. - Increased of the registered capital of the company from Baht 1,866.37 to Baht 3,149.55 million by issuing of 1,283.18 million new ordinary shares at a par value of Baht 1 per share - Increased in paid-up capital from Baht 1,866.37 million to Baht 2,330.76 million on 25 January 2010 - Dr, Prasit Srisuwan was appointed as acting Chief Executive Officer, replacing Mr. Bee Taechaubol who resigned, effective 7 September 2010 onwards - Ms. Sudthida Chirapatsakul was appointed as director (authorize to manage), replacing Mr.Bee Taechaubol who resigned, effective September 29, 2010 onwards - Ms. Netchanok Anawan was appointed as acting head of accounting and finance division, and senior vice president of accounting and finance division, replacing Ms. Luxamee Kongvatanasest /senior executive vice president of accounting and finance division, effective1 November 2010 onwards - Appointed Dr, Prasit Srisuwan as Chief Executive Officer, effective 1 May 2011 onwards - Appointed Ms. Netchanok Anawan as head of accounting and finance division, effective 1 April 2011 onwards - Police Major General Werapong Chuenpagdee was appointed as Director (no management authority), replacing director who resigned, effective 23 November 2011 - Appointed Mr.Nipon Wisityuthasart as independent director replacing resigned director, effective 23 November 2011 - Appointed Mr. Tommy Taechaubol as Director (no management authority), replacing Mr. Totsachai Asvinvichit who resigned, and effective 29 May 2012 - Appointed Mr. Chanachai Joonjiraporn as Managing Director , effective 1 May 2012, and appointed as Executive director, effective 29 May 2012 - Increased paid up capital from Baht 2,330.76 million to Baht 2,330.81 million that fromexercising of warrant 5 which expired on 18 January 2013 - Opened 1 new branch , and closed and merged 1 branch - Decreased of the registered and paid-up capital from Baht 3,149.55 million to Baht 2,330.81 million by canceling the 818.74 unissued ordinary shares - Increased of registered capital from Baht 2,330.81 million to Baht 3,189.79 million by issuing of ordinary new shares at the amount of 858.98 million at a par value of Baht 1 per share. - Increased of paid up capital from Baht 2,330.81 million to Baht 2,589.74 million on 21 May 2013 - Appointed Ms. Sudthida Chirapatsakul and Mr. Chanachai Joonjiraporn as Chief Executive Officer , replacing Dr. Prasit Srisuwan, which effective on 1 November 2013 - Appointed Mr. Suwit Ratanayanont as President ,effective November 1,2013

10 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

Year

2014 2015

Major Developments - Appointed Mr. Supakrit Choksukthanapong as Managing Director of retail brokerage 4, replacing Mr. Suwit Ratanayanont, which effective on 1 November 2013 - Appointed Mr. Chanachai Joonjiraporn as Director (no management authority) , replacing Dr. Prasit Srisuwan who resigned , which effective on 4 November 2013 - Appointed Mr. Tommy Taechaubol as Director (Management Authority) , effective on 25 November 2013 - CGS was established Country Group Holdings Public Company Limited (“CGH”) to be a holding company of CGS, and CGH made a tender offer for all the securities of CGS - Closed and merged 1 branch

Relationship with the group's business of shareholders - None –

2. Nature of Business 2.1 Nature of Business The Company has been approved by Ministry of Finance to operate the following eight businesses: 1. Securities brokerage 2. Securities trading 3. Securities underwriting 4. Investment advisory service 5. Mutual fund management 6. Private fund management 7. Securities borrowing and lending 8. Venture capital management Furthermore, the Company obtained a Derivatives Business license from Securities and Exchange Commission to engage in Derivatives Agent and was approved from Securities and Exchange Commission to act as Financial Advisory.

1. Securities trading business The Company’s investment policy (both short and long term) focuses on Bill of Exchanges and Bonds. The Investment Committee was appointed to determine a clear investment guideline and its policy. Limits and strategy are meticulously placed for each type of investments prior to selling to our clients. Moreover, the Company planned to expand its Bond’s customer portfolio through Institution clients and retail customers.

2. Brokerage business The Company is the Stock Exchange of Thailand’s third brokerage firm to be established. The Company provides brokerage services for individual, juristic, and institutional clients, both local and foreign. To date, The Company has a total of 45 branches nation wide. We provide highly experienced brokers and teams of analysts to advice and answers (both in technical and fundamental aspects) to any clients demand. More over, Investors are able to trade securities, read analyst reports, and find may investment informations through the Company’s website or phone applications (IOS and Android). Clients can open upto three trading accounts with the Company : Cash, Cash Balance, and Credit Balance. As of 2015, the Comapny has 66,393 trading accounts, of which 21,329 accounts are actively traded.

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For the past three years, the Company’s market shares (Volume and Values) were the following: Unit : Million (Except specified)

Trading Value SET MAI Trading Value of the Company Market share (%)

2013

2014

2015

11,777,210.10 553,458.69 1,070,610.18

10,193,179.07 946,111.84 632,781.88

9,997,371.75 768,097.75 539,076.30

4.97

3.11

2.76

Policy on approving clients credit line The Company sets clear policy on setting the appropriate client’s credit limit. Clear policy and guideline will help the Company to control and mitigate the client’s investment risks to be at the appropriate level. The process of opening and approving client’s new account and his credit limits are all documents in writings. The policy mandates that prior to opening the new account, Marketers should know their customer’s investment profile prior to giving them investment advices. This will ensure that the Comapny’s services will answer to all client’s investment objectives, risk appetites, conditions, and purchasing power. The Company’s new clients credit limits policy is in line with the rules and regulations from the Stock Exchange of Thailand (SET) and the Stock Exchange Commission of Thailand (SEC). We also have clear preventive measures against those who use the Brokerage as a mean to money laundering or terrorist funding.

Approval Matrix In order to increase the efficientcy of the new applicant’s process, the approval matrix for the new applicant’s credit limit is per follow:

Credit Line

Authorized Persons

Not exceeding Baht 2 million Managers – Securities Business Div./Branch Office Or of higher position Not exceeding Baht 20 million Head of Securities/ Derivatives Business Div./ Or of higher position Not exceeding Baht 30 million Managing Director of Business Div./ Or of higher Not exceeding Baht 50 million Credit Committee Or Higher Not exceeding Baht 150 million Executive Committee Or Higher The Credit Committee consists of the following members: 1. Executive Director: 1 person 2. Head of Securities Business : 2 people 3. Head of the Derivatives Business Division: 1 person 4. Head of the Risk Management Division: 1 person A credit line is “approved” when at least half of the attending committee members give their approval.

Policy on setting the marginable securities It is the Company’s policy to allow trades on marginable securities to be only within the pre approved list. The list will comprise of marginable securities that are evaluated, each based on its business performance, assets, and liquidity. The approved list of marginable securities together with its interest rates will be announced through company’s communication channels (per SET and SEC regulations). The Comapny appointed the Risk Management Committee to set the list of marginable stocks and their interest rates. Clients can invest into these equities through their Credit Balance accounts. The Risk Management committee consists of one Executive Committee, two Heads of Securities Business Division, one Head of Risk Management Division, one Head of Securities Operation, and one Head of Research Division. The Client’s credit line is approved when at least three out of six committee members agreed. The list of marginable securities and thier initial margins is reviewed at least once every quarter or more frequent (depending on the situation).

12 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

The policy on the initial margin’s rate is categorized into groups based on different risk level per follow:

Type

Margin’s rate (%)

A B C F N

50 60 70 100 0

Notes - The securities type A, B, C and F are classified as liquidable equities and could be used as marginable securities for above credit limit ratio. - The securities type N are clarified as a non marginable securities, and are not applicable.

3. The Derivatives Agent business The Company obtained the Derivative Agent’s business license from SEC in July 2008 and started to operate in September 2008. As Derivatives’ agent, the Company provide derivatives trading services through our investment advicers. We also developed the trading system that supports all orders from different trading channels. For instance, the trading orders could come from the Company’ website over the internet or Investment Advicers’ terminals from the Company branches throughout the country. As of 31st December 2015, the Company grows its TFEX market share (Volume) to 49% (from 26% in previous year) Moreover, in 2015, the Company continuously aimed to educate its Investment Advicers and clients. This was achieved by organizing seminars on new TFEX products for Investment Advicers. For Clients, together with SET, the Company organizes seminars on TFEX technical analysis through out the years. In 2015, the Company planned to increase its TFEX market share by 2% by expanding its retail client’s base as well as increasing its marketing officers.

4. Investment Advisory business The Company gained SET’s approval to conduct the Equities Investment Advicers business. Equities Investment Advicer’s soul responsibilities to its client is to point out the value and opportunity to invest in that particular equities. The advice should be based upon client’s investment objectives, Advicer’s indepth knowledge on risk factors, advicer’s investment experiences, client’s financial standing, liabilities, conditions, and risk appetite.

5. Investment Banking business The Company is one of the leaders as an Investment Banking business provider. Our IB team consists of investment experts that are well-trusted by clients.

5.1 Financial Advicery Services The Company’s Invesment Banking department (IB) was established in December 2006, and later joined the Investment Banking’s club on 23rd January 2007. SEC later granted the Company the 10 years financial advisory services license on 21st March 2012. Currently, the Company’s IB team comprises of investment experts (from small to large business size and local to foreign businesses) to meet any of our clients’ investment demands. Our IB team emphasized on providing excellent customer services, building continuous customer relations and providing insightful advices that answers to the client’s investment objectives. The IB team’s services can be categorized as follows: - Advisory services to companies interested in IPO - Advisory services on issuing and offering fixed income securities: Debentures and Subordinates - Advisory services on Mergers and Acquisitions to both local and foreign companies - Advisory services on conducting company‘s valuation and corporate restructuring - Advisory services to the joint venture - Advisory services as an Independent Financial Advisory

13 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

- Other advisory services on Investment Banking such as corporate refinancing

5.2 Securities Underwriting Business The Company was granted the Securities Underwriting business license from the SEC on 19th November 2008. This strategic business expansion is the extension of The Company’s Financial Advisory business. To other Institutions and Brokerages, The Company can provide its securities underwriting services either as Lead Underwriter or Co-Underwriter.

6. Securities Borrowing and Lending (SBL) On the 12th July 2010, the Company obtained SEC’s approval to operate the Securities Borrowing and Lending (SBL) business. The Company Clients will be able to lend their whole securities (debt free) port for a fee. Vice versa, the Company’s clients who which to borrow securities, will have to pay the fee. The Company’s policies for SBL are as follow: 1. The Company will lend only the approved securities that are within the top SET 100 and ETF to clients who wish to short trade. 2. Currently, shorting could only be done through Client’s Cash accounts. In the near future, The Company plans to expands to short trading channel through Cash Balance and Credit Balance accounts. 3. Borrower will be charged a borrowing’s fee by The Company. Vice versa, the lender will receive a lending’s fee from The Company. 4. Rights to the lending securities will remain to be with the lender through out the SBL period. The Company believes that SBL business will give its clients the alternative choice of investment. Especially during the time when the market is highly volatile, SBL provides the alternative investment choice while managing Client’s risk level. Because of the growing SBL’s market, The Company believes that SBL business will be one of the key drivers for its revenue. The 2016 SBL are the following: 1. Developes SBL’s trading system to better provide clients with more investment options 2. Expands SBL’s customer base from both potential Institution and Retail customers

7. Selling Agent business

The Company is the Selling Agent of more than 13 Assets Management companies, totaling of over 200 funds. Coupling with our investment experts who give insightful advices, the Company believes that clients will have good alternatives to diversify their investments. As of 31st December 2015, the Company is the Selling Agent for the following Asset Management Companies: 1. Aberdeen Asset Management Co., Ltd 2. Assets Plus Fund Management Co., Ltd 3. CIMB-Principal Asset Management Co., Ltd 4. Krungsri Asset Management Co.,Ltd. 5. Krung Thai Asset Management PCL 6. Land and House Fund Management Co., Ltd 7. MFC Asset Management PCL 8. One Asset Management Co., Ltd 9. Phatra Asset Management Co., Ltd 10. Phillip Asset Management Co., Ltd 11. Solaris Asset Management Co., Ltd 12. SCB Asset Management Co., Ltd 13. UOB Asset Management (Thailand) Co., Ltd

8. Debenture Business The Company has a policy to expand its investment services through the Debenture Business. With attractive characteristics of high return, low investment risk, flexible in the investment’s lock up time period, the Debenture business is the new investment options for the Company’s clients.

14 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

There are many ways to Trade Debentures. Clients can trade between themselves through the Company brokerage or trade directly with other Debentures selling agents. In ether cases, Clients will need to specified the selling price and amount to the Company. The Company will then deliver the purchasing comfirmation letter and the updated total value of client’s account. The methods of delivery to clients are either through mail or email. Different Debenture has different risk level and lock up period. Therefore, it’s up to each client to determines one that matches their risk appetite and preferred lock up period.

Income Structure of the Company Income Brokerage Fee Fee and Service Income Gain (loss) on investment Gain (loss) on trading in derivatives Share of gain from investment in which equity method is applied Interest and dividend Interest on margin loan Other Income Total Income Brokerage Fee

Financial Statements in which Equity method is applied For the year ended December 31 2015 2014 2013 Million Baht % Million Baht % Million Baht 868.50 68.64 1,024.70 64.03 1,695.68 61.14 4.83 61.72 3.86 39.59 113.95 9.01 99.04 6.19 66.15 3.59 0.29 3.16 0.20 19.72 (4.28) (0.34) 60.41 3.77 86.42 56.72 46.33 103.78 15.47 1,265.20

4.49 3.66 8.20 1.22 100.00

68.29 45.07

4.27 2.81

237.98 1,600.37

14.87 100.00

90.96 56.61 13.71 2,068.84

% 81.96 1.91 3.20 0.95 4.18 4.40 2.74 0.66 100.00

Ability to maintain New liquid Capital Ratio (NCR) According to the SEC regulations, the Securities company is required to maintain a minimum NCR ratio of 7% of the general liabilities and marginable securities’ value. As of 31st December 2015, the Company was able to maintain its NCR at 216.39 %.

2.3 Market and Compeition Marketing Policy The Company has focused on providing the best service and offering full ranges of investment services. Also, the Company aims to maintain a steady growth of market share. The plans are as follows: - Develop Equities and Derivatives’ trading system to be more efficient in handling the large trading volume. This in turn will also enhance customer’s satisfaction in our services. - Develop new products and services to answers client’s investment needs. Consequently, clients will be able to manage their investment portfolio effectively and efficiently. - Arrange staffs trainings to increase their capabilities and knowledge as an investment advicer. - Restructured Corporate structure to increase its management’s efficientcy with the objectives of providing the best and least complicated services to our clients. - Organize road shows and seminars to educate interested investors in both Bangkok and up country areas. The activities will take place when SET launches new investment products such as gold futures, derivative warrants, etc. Because these activities will attract new investors, our clients base will grow while maintaining our existing ones.

15 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

Customer profiles and their dependents on marketing officers The majority of the Company customers are general retail customers consisting of locals and foreigners, with Institutional clients. Thus, the Company does not depends on any particular client nor marketing officer. In 2016, inorder to deviate from relying heavily on the volatile Retail Brokerage’s business, the Company plans on growing its clienteles from the Institutional clients (both domestics and abroad). The firm also plans on establishing the new Private Funds Business. The Company estimates that its Institutional Client’s contribution to the total customer base’s contribution will grow by 20%.

Domestic and Foreign Clients’ Contribution As of 31st December 2015 , the proportions of the Company’s clients between the domestic and foreign clients were as follows:

Clients type The Securities company’s account

# of opened accounts

# of active accounts

Trading value of each account (Baht) TFEX Contract Equity Value Value (MB) (MB)

Retail – Thai

65,306

20,764

Retail – Foreign

1,419

249

1.17

5,834,073,606.65

Juristic – Thai

154

0.15

5,994,384,895.71

Institution – Domestic

603

264

1.24

65,520,728,623.99

Institution – Foreign

67,565

21,329

100.00 1,254,295,438,874.09

2,949,630.00

Juristic – Foreign

Total

0.10

164,158,180,425.00

662,690.00

97.35 1,012,788,071,322.74

2,286,940.00

Note: # of accounts (Total and Active) also includes accounts that were closed during the year.

Competitive Conditions Since Brokerage’s fee liberalization in 2012, the competition among the Brokerages has been very fierce. Evident by the market’s declining rate of the commission, transferring trend of marketing officers, and increasing numbers of new Brokerages, the competition has been growing over the years. With the higher competition in Brokerage market, the Company will need to expand it’s revenue’s stream to come from other businesses as well. These other businesses include Investment Banking, Asset Managements, and Securities Investments.

SET Market’s competition 1,700 1,650 1,600 1,550 1,500 1,450 1,400 1,350 1,300 1,250 1,200 1,150 1,100 01/57 02/57 03/57 04/57 05/57 06/57 07/57 08/57 09/57 10/57 11/57 12/57 01/58 02/58 03/58 04/58 05/58 06/58 07/58 08/58 09/58 10/58 11/58 12/58

The SET Index  Closed at 1,288.02 points at the end of 2015 (decreased 14.00% from 2014)   

16 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

SET Index high was 1,615.89 points SET Index low was 1,261.66 points SET’s average daily market turnover was 41,141 Million Baht

The Stock Exchange of Thailand’s market in 2015 In 2015, The SET index closed at 1,288.02 points (-14% VS 2014). At the beginning of the year, the SET index peaked at 1,615.89 points prior to its continuous declined through out the year. The SET index’s lowest point was at 1,251.99 points with an average trading value at 41,141 Million Baht per day. The major factors that influenced SET index to fluctuate in 2015 were: - Fear of the uncertainty in Thailand’s economic recovery ability - Fear that the Fed will hike its FED Fund Rate. This might create a movement of outflowing the investment money back to the U.S. - Fear of China’s fast economic recession from the Chinese’s government’s restructuring plan. The plan aims to not rely its Economy too heavily on the Investment portion, but rather on the domestic consumption. China’s economic recession also impacts the region’s economy and its investment markets as well. Economists estimates China’s GDP to be lower than 7% as a result from the recession. These factors impacted our stock market greatly through out the year. At the beginning of the 2015, the SET’s index increased in parallel to the global stock market’s index. The incremental was due to Investor’s speculations that the European Central Bank would have re-stimulated its market through Quantitative Easing method. However, the SET’s index began to decline in May to 1,504 points in June. The total net sell from Foreign investors in June was over 10 Billion Baht. This is a result from the factors mentioned above coupling with the negative export market’s figure announced by the Bank of Thailand. During the second half of 2015, SET index was fluctuating agressively. The fluctuating factors were driven from both domestic and abroad. These factors include speculation of USA’s hike in Federal Reserve System’s interest rate, Greece’s default in payments, continuous declined of oil prices, and underperformance by SET listed companies. Consequently, these factors influenced Chinese Investors to liquidate their assets that were perceived to be risky. The crumbling of the stock market’s index started from China’s Shanghai Stock Exchange market, following by other countries’ stock markets. There were a total of 36 newly listed companies in the SET and MAI in 2015. Ofwhich, 23 companies were listed in the SET and 13 companies were listed in the MAI. In 2015, the total trading values per each type of investors can be categorized per follow: 1) 6,418 Million Baht from other Proprietary Traders 2) 154,346 Million Baht from the Foreign Investors 3) 79,055 Million Baht from Institutions 4) 81,709 Million Baht from Local Investors. 2015 Net Buying and Selling values by different types of Investors Unit : Million Baht

Year

Institutional Investors

Proprietary Trading

Foreign Investors

Local Investors

Institutional Investors

Proprietary Trading

Foreign Investors

2005 2006

(51,204) (12,757)

(121) 1,084

118,542 83,446

(67,217) (71,772)

January February

9,785 (3,528)

8,260 (1,631)

(4,300) (6,898)

(13,745) 12,057

2007

3,764

(1,601)

55,018

(57,181)

March

(2,657)

(8,848)

2,742

8,764

2008

45,177

924

(162,346)

116,246

April

16,437

5,724

130

(22,291)

2009

(2,303)

1,388

38,231

(37,316)

May

4,366

(9,763)

3,147

2,250

2010

(15,200)

(449)

81,724

(66,075)

June

8,259

1,010

(10,488)

1,219

2011

(29,149)

1,307

(5,119)

32,962

July

9,018

(4,738)

(26,425)

22,145

2012

(24,302)

7,256

76,388

(59,342)

August

13,888

(44,301)

30,322

2013

108,163

(1,723)

(193,911)

87,471

September

1,685

(1,566)

(21,150)

21,031

2014

71,424

3,582

(36,584)

(38,421)

October

(5,201)

9,179

209

(4,186)

2015

79,055

(6,418)

(154,346)

81,709

November

7,920

(512)

(14,483)

7,074

December

19,084

(3,625)

(32,528)

17,069

Month

17 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

Local Investors

Key Indicators 2011

2012

2013

2014

2015

0.1%

6.5%

2.9%

0.7%

2.5-3% (F)

Market Capitalization (Btm)

8,407,696

11,831,448

11,496,765

13,856,283

12,282,754

Market Turnover(Btm)

7,040,457

7,615,637

11,777,210

10,193,179

9,997,371

Average Daily Market Turnover (SET)

28,854

31,084

48,070

41,604

41,141

SET Index (High)

1,144

1,397

1,643

1,600

1,615

SET Index (Low)

855

1,036

1,275

1,224

1,261

P/E (times)

12.07

18.25

14.60

17.81

22.57

Dividend Yield (%)

3.72

2.98

3.24

2.94

1.74

GDP Growth (at 1988 constant price)

Sources: BOT , SET , CGS Note: Figures are based on the estimated figures of the closing period

Securities Business Trend in 2016 The Stock Exchange of Thailand announced its 2016 strategies to expand and improve the quality of the registered companies per following: 1. Expand and develops the quality of the registered companies to be in line with the Government economic policies 2. Strengthen SME by providing accessability to funds and business opportunities. This will help stimulate Thailand’s Fund market while benefiting the economy and society. 3. Continuously increase the awareness of the environment, society, and corporate governance among the registered companies. The Fed hike in its interest rate at the end of 2015, is a positive signal to Thailand’s securities market. The SET index declined to the point that was very attractive to investors to enter. This should increase the SET’s trading activities. However, the also depends on any other local and global fluctuating economic factors that could impact Thailand’s economy.

The Company’s strategies on Securities business The Company places great importance in the Brokerage’s business strategy to increase its revenue. Thus, revenue contribution drivers are all considered in the business stratey. These factors include economic situation, political climate, government policies, SEC rules and regulations. The Brokerage market’s competition has been growing to be more aggressive last year. Currently, there are a total of 42 Brokerages in the market. On top of offering competitive price competition, we also focus on improving the quality of our customer services and securities analysis to gain more market share. The Company is ready to support SET’s recent announcement in 2016 to expand its customer base to the Greater Mekong Subregion (GMS) region. From this expansion, SET targets its customer base to be increased by 110,000 customers in Equitites and 10,000 customers in Derivatives. The Company plan to support SET’s expansion fully with its complete investment services and 45 Brokerage branches around the GMS zone. The Company employs the following strategies : - Find new products and services to increase the stream of revenue - Educate customers inorder to ensure the understanding of the new products and services - Improve our Marketers’ skills set to be able to give valuable advices to our customers

18 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

2.3 Acquisition of Products and Services Source of Funds The Company is mostly self-financed.

Undeliver task - none –

Lending to Parties Related to the Management or Major Shareholder - none –

3. Risk Factors 1. Risk from operating in investment business The Company has an investment risk as such investment may not generate return as expected. Given that the Company is aware of such risk, an Investment Committee (IC) was appointed to determine the proper Company’s investment policy and strategy. The IC was responsible for implementing a proper investment policy and risk management control system that is within the the policy set by the Risk Management committee. The policy and control system should be adaptable to the particular investment climate. Not only will this help ensure maximum return for the Company, but also ensure the Company to be in accordance with the regulations and frameworks set up by the Board of Directors.

2. Risk from Competition in Securities Business Securities business’s main source of income relies on the brokerage fee, which depends on the trading volume. Since the liberalized of the Brokerage commission fee in 2010, the Company faced competitions in various aspects. Apart from the commission fee, the Company faces competitions in retail branch expansions, new entry of Brokerage firms, new customer services campaigns, etc. Thus, it is imperative that the Company adapts its strategy to recruit high-caliber human resources, expand customers’ base and stimulate higher trading volume, and develope strong information technology infrastructure. - Recruit high-caliber human resources: the Company focuses on recruiting only veterans in Serurities or similar industries. - Expand customers’ base, and Stimulate higher trading volume: a) the Company develops its marketers capabilities through numerous seminars and trainings. These trainings happens continuousely throughout the year, particularly when the SET launches new products and services. b) Ensure constant communication between the managements and our marketers about any changes in our industry. c) increase the quality of analyst reports to answers our client demands - Developes strong information technology infrastructure: continuously update the information technology infrastrucutre to be up-todate and can answers to all clients demands.

3. Risk from Defaults As of 31st December 2015, the Company has a total securities’s business receivables of 305.31 Millions Baht (23.29 Millions Baht less than 2014). However, the Company has already reserved contingency fund (“allowance for doubtful accounts”) at the amount of the total receivables, less collateral values, in the case of default. Currently, the Company has a policy to reduce the risks of default; the default types include both from securities payment and from the clients’ deposit gaurantee. The policy stresses on screening clients and limiting clients’ credit lines used for trading Equities, and Derivatives. As part of the process, the Company evaluates client’s financial standings, solvency, liquidity, and investment experiences. The client’s financial standing and his credit limit is also reviewed regularly to strictly adhere to the policy. In case of default, the client will be prohibited from any additional purchase of securities until the receivables are fully paid. Both Marketing and Settlement officers are responsible to follow up with the client. If the receivables are not paid in full within the given timeframe, then the Legal department will prosecute the necessary legal actions.

19 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

4. Risk from Clients switching out Most of the Company clients are Retail, Corporates, and Institution (local and abroad). As of 31st December 2015, the Company has a total of 67,565 accounts, of which 21,329 accounts were actively traded. The total brokerage fee contributed to 66.54% of the total the Company income. Realizing the importance of the Brokerage business, the Company implements the strategic iniatitves mentioned in section 3 “Risk from Competition in Securities Business” to minimize the risk of our clients’ switching out.

5. Risk from Human Resources In a securities business, having good employees is one of the key success factors. Good employees who possess valuable skill set such as deep investment knowledge, experiences, and expertise, are very hard to find. Thus, in the competitive Securities business, corporations are very aggressive in head hunting from their competitors. These direct recruitment is a great threat to the Company’s income. the Company realized the importance of our employees, thus we emphasizes on building a strong employee’s Traning and Development programs and competitive Compensation and Benefits package.

6. Risk from investments in Securities Investment in Securities exposes the Company to the risk of not getting the expected return on the initial investment. Thus, the Company established the Invesment Committee (IC) to set a policy on Equities and Derivatives investments. The policy dictates both stop loss limit and position limit. The investment policy also focus on securities with good fundamental and low risk. However, the policy could change depending upon the market conditions.

7. Risk from Underwriting Business In Underwriting business, the Company is exposed to the risk of undersubscibtion. The reasons could be contributed from the lack of investor’s confidence in market, fluctuating financial and securities market, or inappropriate amount and offering price of the contracted securities. Consequently, the Company will have to purchase the remaining unsubscribe securities and later realized the loss from the securites’ price drops. In order to minimize the Underwriting’s risk, the Company meticulously analyzes the preliminary information and the potential market’s demand of the company’s securities. Thus, the Company established the Underwriting Committee to overlook and approve each of the underwriting contract.

8. Risk from Margin loan Inorder to mitigate the Margin loan’s risk, the Company evaluates client’s financial standing and capabilities. The Client’s credit limit is also reviewed regularly to see if adjustments are needed. The Company also established the Credit Committee that meets atleast once a month. The committee’s responsibilities include setting policies on placement of marginable securities, enforcement of call margin, and enforcement of force margin. The policies have been strictly enforced inorder to prevent any damages that might incurred upon the company and clients. On 31st December 2015, there was a total Margin Loan’s value of 486.68 Million Baht (-23.18% from 2014).

9. Risk from Derivative agent’s business In the Derivative agent’s business, the Company faces the risk of having insufficient client’s deposits for the actual liabilities. The risk is particularly high when the client loses his investments from the derivatives warrants. Thus, inorder to mitigate the risk, the Company carefully screens for clients who are knowledgable, experienced, and have the appropriate financial standings. Moreover, the Company also requires Clients to place cash deposits prior to any Derivatives’ purchase. All of Clients’ trading activities, account balances (including deposits), and credit limits are constantly reviewed. Should the Clients fail to comply to the Company’s regulations, the trading contract will be forced closed.

20 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

10. Risk of businessâ&#x20AC;&#x2122;s impacts from crisis The Company places the importance on managing risks from different types of crisis like natural disasters, riots, etc. In such case, the Company has already planned different preventive measures, both for the main and contingency plans. The crisis management plans are reviewed annually. In addition, the Company has been insured from different types of crisis, including those from natural causes. Currently, the total CGS insured valued is over 295.65 Million Baht.

4. Operating Assets 4.1 The Companyâ&#x20AC;&#x2122;s permanent asset As of 31 December 2015 the Company had operating asset with details as follows:

Type of Assets

ownership

Accounting value (Baht)

Obligation

own

11,580,480

- none -

500/1-3 Prasarnmaitee Raod Sop Tui, Muang, Lumpang 52100

own

9,586,473

- none -

228/28 - 30 Baromtrilokkanard Rd.,Nai Muang, Muang, Phitsanulok 65000

own

11,848,747

- none -

own

- none -

own

105,602,294

- none -

own

630,278

- none -

Property and Premises 154/14 - 16 Phangnga Rd., Talat Yai, Muang, Phuket 83000

Premise 50/147-157 Hillside Plaza and Condotel 4th floor, Huay Kaew Road , Chang Phuek, Muang, Chiang Mai 50300 Leasehold improvement, Furniture and office equipment Vehicles

4.2 Summary of office rental agreement As of 31 December 2015, the Company had total intangibles assets of Baht 98,225,958 as follow

Type

Ownership

Accounting Value (Baht)

Using derivatives business fee

Computer Software

78,912,876

Securities license

2,657,500

Derivatives business membership

15,945,000

Computer Software in progress

4,893,144

21 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

Summary of office rental agreement As of 31 December 2015, the Company has rented the building for Head office and Branch offices with details as follows: Remaining Rental Head and Branch offices Obligation period 132 (Sindhorn Tower 1) level 2, 3 and 9 Wireless Road - level 2 : if the contract is terminated before Lumpini, Pathumwan, Bangkok 10330 the end of contract , bail will be distrained for Baht 5,088,000 level 2 1 mth - level 3: if the contract is terminated before level 3 1 mth the end of contract , bail will be distrained for level 9 1 mth Baht 753,600 - level 9: if the contract is terminated before the end of contract , bail will be distrained for Baht 1,954,800 if the contract is terminated before the end of 1693 Central Plaza Building (Lardprao) 11th Floor, Paholyothin 9 mth contract , bail will be distrained for Baht Rd., Ladyao, Chatuchak, Bangkok 10900 184,963.68 if the contract is terminated before the end of 275 The Mall Building (Bangkae) 6th Floor, Petkasem Rd., 2 y 1 mth contract , bail will be distrained for Baht North Bangkae, Bangkae, Bangkok 10160 330,786 if the contract is terminated before the end of 30/39-50 The Mall Building (Ngamwongwan) 12th Floor, 2 y 4 mth contract , bail will be distrained for Baht Ngamwongwan Rd., Bangkhen, Muang, Nonthaburi 11000 335,540 if the contract is terminated before the end of 1293 Carrefour Building (Samrong) 2nd Floor, Moo 4 Sukhumvit 10 mth contract , bail will be distrained for Baht Rd., Theparak, Muang, Samutprakarn 10270 218,820 7/129-221 Room No. 2601, Central Pinklao Department Store, if the contract is terminated before the end of 1 y 3 mth 6th Floor, Boromrajachonnanee Road, Arunamarin, contract , bail will be distrained for Baht Bangkoknoi, Bangkok 10700 155,294.10 if the contract is terminated before the end of 191 Room C, Silom Complex Building 19th Floor, Silom Rd., 2 y 8 mth contract , the remaining rent must be paid. Bangrak, Silom, Bangkok 10500 1093/73 Central City Tower 14th floor, Bangna-Trad Rd., Bangna-Trad, Bangna, Bangkok 10260

2 y 9 mth

99, 99/9 Moo 2 Chaengwattana Rd., Bangtalard, Pakkred, Nonthaburi

2 y 11 mth

591/5-7 Phaholyothin Road, Wiang, Muang, Chiang Rai 57000

919/112 Moo10 Nakhonsawan Tok, Muang Nakhonsawan, Nakhonsawan 60000

7 mth

2 y 2 mth

22 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

if the contract is terminated before the end of contract , bail will be distrained for Baht 231,807.60 if the contract is terminated before the end of contract , bail will be distrained for Baht 197,867.85 if the contract is terminated before the end of contract , bail will be distrained for Baht 200,000 - none -

Remaining Rental period

Obligation

2 y 5 mth

- none -

Closed on 1 September 2015

- none -

12/5 Mukda Rd., Nai Muang, Muang, Lampoon 5100

2 y 8 mth

- none -

200 Chuladis Hat Yai Plaza Shopping Complex, 4th Floor, Nipatuthit 3 Rd., Hat Yai, Songkhla 90110

1 y 3 mth

- none -

10 mth

- none -

1 y 4 mth

The contract can be terminated till the end of contract.

1 y 5 mth

- none -

10 mth

- none -

2 y 7 mth

- none -

1 y 7 mth

if the contract is terminated before the end of contract , bail will be distrained for Baht 70,000

232/6 Udon Phone Tech Building 2nd Floor, Udondussadee Rd., Markhaeng, Muang, Udonthani 41000

Closed on 1 December 2015

- none -

238/8 Ozone village Room 17-19, 2nd floor, Theparak Raod, Nai Muang, Muang, Khonkaen 4000

1 yt 4 mth

- none -

4 mth

if the contract is terminated before the end of contract , bail will be distrained for Baht 100,000

512/8 Chayangkul Rd., Nai Muang, Muang, Ubon Ratchathani 34000

2 y 11 mth

- none -

8/47-48 Palad Muang Rd., Nai Muang, Muang, Buriram 31000

2 y 3 mth

- none -

Head and Branch offices 3/5 Chaikaw Rd., Viang, Muang, Phayao 56000

2/9-10 Nakornping Condominium 1st floor, Chang Phuek, Muang Chiang Mai, Chiang Mai 50300

62, 64, 66,68 Soi Wandeekositkhullaporn, Pattanakarnkukwang, Nai Muang, Muang, Nakhon Si Thammarat 80000 59/5-7 Huaiyod Rd., Tubtieng, Muang, Trang 92000 467 Saiburi Road, Bo Yang, Muang, Songkla 90000

1/9 Taweesinka Road, Tatapao, Muang, Chumporn 86000 7/8 Sirirath road, Nai Muang, Muang, Surin 32000 1036, 1036/1-4 Wanlooksue Road, Muangtai, Muang, Sisaket 33000

166/1-2 Chompol Rd., Nai Muang, Muang, Nakornratchasima 30000

23 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

Head and Branch offices

Remaining Rental period

Obligation

555 Moo 1 Petkasem Rd., Raisom, Muang, Petchaburi 76000

1 y 6 mth

- none -

277/2 Sangchuto Rd., Bannua, Muang, Kanchanaburi 71000

2 y 3 mth Moved 27 April 2015

- none -

591/19 Paholyothin Rd., Pakprew, Muang , Saraburi 18000

1 y 8 mth

- none -

115 Star Plaza Building, 1st Floor, Soi Soonkankasai 5, Sukhumvit Rd., Cheong-nern, Muang, Rayong 21000

1 y 5 mth

- none -

3/222 Moo 6, Chalermprakiat Rd., Nakuae, Banglamung, Chonburi 20150

1 y 11 mth

- none -

99 Pipitprasart Rd., Pra Pathom Jedi, Muang Nakhonpathom , Nakhonpathom 73000

838/1A-838/1B Chaichana Rd., Bang Pla Soi, Muang, Chonburi 20000 (present address) (Move to new address on May 13,2013) 99/49-50 Songpol Rd., Banpong, Banpong, Ratchaburi 70110 1495-1497 1 Floor, Thep-Kunakorn Rd., Na Muang, Muang Chachoengsao 24000 57 Park Ventures Building Ecoplex Room No 1607B – 1608,16th Floor, Wireless Rd., Lumpini, Pathumwan, Bangkok 10330 195 Empire Tower Room 1406,14th tower 3 South Sathorn Rd., Yanawa, Sathorn, Bangkok 10210 2884 Manoopol Tower1,6th floor Phetchaburi Tat Mai Rd., Bang Kapi, Huai Khwang , Bangkok 10310

In any case of contract termination, if rental asset is in good condition, bail will be returned Baht 300,000

2 y 3 mth

Rental contract cannot be cancelled before March 31,2015

2 y 11 mth Moved 1 December 2015 2 y 8 mth

2 y 10 mth

8 mth

- none– if the contract is terminated before the end of contract , bail will be distrained for Baht 715,875 if the contract is terminated before the end of contract , bail will be distrained for Baht 358,551.90 if the contract is terminated before the end of contract , bail will be distrained for Baht 154,200

Policy on ceasing revenue recognition The Company recognizes interest income from its securities business receivables on an accrual basis. The Company will cease recognition of interest income whenever uncertainty in the collection of principal and interest arises. Any of the following cases are considered as “uncertainty in the collection of principal and interest”. 1. Debtor whose collateral value is lower than the amount owed. 2. Debtor whose installment payment is scheduled at every 3 months, but has defaulted on principal and interest payment for more than

24 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

3 months. 3. Debtor whose installment payment is scheduled at a period longer than 3 months except when there is convincing evidence that repayment will be made to the Company. 4. Financial institution debtor whose operational status is in doubt. 5. Other debtor whose interest payment is 3 months overdue.

Policy on provisions for doubtful accounts and bad debts The Companyâ&#x20AC;&#x2122;s policy for provision of doubtful accounts is mainly done through the financial evaluation of each client. This includes risk appraisal and collateral valuation. The Company will make provisions for doubtful accounts whenever the value of the collateral is not enough to cover the amounts owed or when the debtor is determined unable to fully repay principal and interest. The Company has classified debts pursuant to the SECâ&#x20AC;&#x2122;s announcement No. Gor.Thor. 33/2543, dated August 25, 2000, and Gor.Thor. 5/2544, dated February 15, 2001 regarding the accounting for troubled debtors of Companies as follows; 1. Bad debt refers to: 1.1 Debt accrued by debtor whom the Company had claimed but not been repaid and the Company had written off according to the Taxation Code. 1.2 Debt where the Company makes an agreement to revoke. 2. Doubtful debt refers to the amount owed exceeding the value of the collateral, which falls into the following categories: 2.1 Ordinary debtor, trouble financial institution debtor and other debtor, whose collateral is lower in value than the amount owed. 2.2 Debtor whose installment is scheduled at every 3 months but defaults on principal and interest payment for more than 3 months. 2.3 Debtor whose installment is scheduled at a period longer than 3 months except when there is convincing evidence that repayment will be made to the Company. 3. A substandard debt refers to the amount owed, which could be covered by the collateral mentioned in (2). The Company has the policy to write off bad debt whenever it is found and set the provision for the doubtful accounts at no less than 100% of doubtful debt and total substandard debts less collateral value. As of 31 December 2015, the Company recorded provisions for doubtful accounts of Baht 352.32 million.

Policy on Provisioning for Investment in Securities Marketable equity securities held for trading are stated at fair value, with any resultant gain or loss arising from changes in value of securities recognized in the statements of income. Debt securities that the Company intends and are able to hold to maturity are stated at amortized cost less impairment losses. The difference between the acquisition cost and redemption value of such debt securities is amortized using the effective interest rate method over the period to maturity. Debt securities and marketable equity securities other than those securities held for trading or intended to be held to maturity, are classified as being available-for-sale and are stated at fair value, with any resultant gain or loss arising from changes in value of securities being recognized directly in equity. The exceptions are impairment losses, which are recognized in the statements of income. When these investments are derecognized, the cumulative gain or loss previously recognized directly in equity is recognized in the statements of income. Where these investments are interest-bearing, interest calculated using the effective interest method is recognized in the statements of income.

5. Future Projects - none â&#x20AC;&#x201C;

25 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

6. Legal Dispute As of 31 December 2015, The Company has no legal dispute that negatively affects the assets of the Company by more than 5 %of shareholders equity and no legal dispute that significantly affects the Companyâ&#x20AC;&#x2122;s operating business.

Others important information Name Address (Headquarters) Licenses

Registration Number Phone Fax Homepage Registered Capital Paid-up Capital Type of shares

: Country Group Securites Public Company Limited : 132 Sindhorn Tower 1 ; 2nd Floor Wireless Road, Lumpini, Pathumwan Bangkok, Thailand 10330 : The Company obtained a Securities Business Type A license from the Ministry of Finance and Securities and Exchange Commission to engage in the securities business as follows: 1. Securities Brokerage 2. Securities Trading 3. Securities Underwriting 4. Investment Advisory Service 5. Mutual Fund Management 6. Private Fund Management 7. Securities Borrowing and Lending 8. Venture Capital Management - The Company obtained a Derivatives Business license from Securities and Exchange Commission to engage in Derivatives Agent. - The Company was approved from Securities and Exchange Commission to act as Financial Advisory. : 0107537000572 0-2205-7000 0-2205-7171 www.cgsec.co.th : Baht 2,589,743,484 : Baht 2,589,743,484 : 2,589,743,484 ordinary shares at par value of Baht 1 per share

Other References Share Registrar

Debt-holder Representative Auditor

Financial Advisors

: Thailand Securities Depository Company Limited 62 Stock Exchange of Thailand Building 4th, 7th floors Ratchadapisek Road, Kwaeng Klongtoey, Khet Klongtoey Bangkok 10110 Tel: 0-2229-2800 Fax : 0-2359-1259 : None : Mr. Chavala Theinprasertkit , CPA Number 4301 Deloitte Touche Tohmstsu Jalyos Audit Co., Ltd. Ratjanakam Building, 25th Floor, 183 South Sathorn Road, Kwaeng Yannawa, Khet Sathorn Bangkok 10120 Telephone : 0-2676-5700 Fax : 0-2676-5757 : None

26 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

8. Shareholders Information As at December 2015, the Company had registered capital of Baht 2,589,743,484, which Baht 2,589,743,484 million was paid up.The paid up capital consists of 2,589,743,484 ordinary shares at a par value of Baht 1.

8.1 Shareholders The top ten major shareholders as of 31 December 2015 were as follows: No. 1. 2. 3. 4. 5. 6. 7. 8. 9. 10.

Name Country Group Holdings PCL Thai Fuji Securities Company limited Mr.Somchai Mimungkom Ms.Phenprapha Chaengthep Mr. Pai, Wen-Cheng Mr. Worapong Jaimonkonprasert Mr. Lin, Wen-Ye Thanathai Securities Company limited HSBC BANK PLC-HSBC BROKING SECURITIES (ASIA) LIMITED Mr. Sumit Petcharaphirat Total

No. of Share 2,571,602,972 3,988,351 1,580,087 1,015,178 837,790 642,553 494,271 437,171 308,918 250,224 2,581,157,515

% 99.299 0.154 0.061 0.039 0.032 0.024 0.019 0.016 0.011 0.009 99.668

8.2 Issuance of Securities for Capital increased Policy – None –

8.3 Dividend Policy Under normal business conditions, it is the policy of the Board to pay dividend of at least 60% of the net profit after tax. This dividend policy remains unchanged.

27 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

9. Management Structure Organization Chart as of 31 December 2015

28 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

9.1 Board of Directors and Subcommittees 1) Board of Directors As of 31 December 2015, the Company structure consisted of 14 directors as follows:

Name

Position

Mr. Prayoon Chindapradist, Prof Mr. Dej Namsirikul Gen. Wattana Sanphanich Pol. Gen. Somchai Vanichsenee Mr. Charn Tulyapisitchai Mr. Sadawut Taechaubol Mr. Surabhon Kwunchaithunya Mr. Hong Chye Sim Mr. Somkad Sueptrakul Ms. Sudthida Chirapatsakul Pol. Lt. Gen. Werapong Chuenpagdee Mr. Nipon Wisityuthasart Mr. Tommy Taechaubol Mr. Chanachai Joonjiraporn Mr. Pitakphol Roongrojsuwan is the Compay’s secretary

Chairperson Vice Chairperson and Independent Director Vice Chairperson and Independent Director Independent Director Independent Director Director Director Director Director Director Independent Director Independent Director Director Director

Authorized Directors Either Prayoon Chindapradist, Pro., Chairperson or Mr. Sadawut Taechaubol, Executive Chairperson signs with the Company’s seal affixed or two of the following three directors: Mr. Surabhon Kwunchaithunya, Ms. Sudthida Chirapatsakul and Mr. Tommy Taechaubol cosign with the Company’s seal affixed.

Board of Directors’ meeting In 2014 and 2015, the no. of meeting and attendance were summarized as follows:

Name Mr. Prayoon Chindapradist, Prof Mr. Dej Namsirikul Gen. Wattana Sanphanich Pol. Gen. Somchai Vanichsenee Mr. Charn Tulyapisitchai Mr. Sadawut Taechaubol Mr. Surabhon Kwunchaithunya Mr. Hong Chye Sim Mr. Litti Kewkacha* Mr. Somkad Sueptrakul Ms. Sudthida Chirapatsakul

Attendance/No. of meeting 2015 2014 12/12 12/12 11/12 12/12 10/12 12/12 12/12 11/12 0/2 12/12 11/12

29 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

10/12 12/12 11/12 12/12 11/12 11/12 12/12 12/12 0/12 12/12 12/12

Attendance/No. of meeting 2015 2014

Name Pol. Lt. Gen. Werapong Chuenpagdee Mr. Nipon Wisityuthasart Mr. Tommy Taechaubol Mr. Chanachai Joonjiraporn

11/12 12/12 12/12 10/12

10/12 12/12 10/12 11/12

Remarks : * Resigned from the Company, effective 1 March 2015

2) Audit Committee As of 31 December 2015, Audit Committee consists of 3 directors as follows:

Name

Position

Pol. Gen. Somchai Vanichsenee Chairperson of Audit Committee Mr. Dej Namsirikul Member of Audit Committee Mr. Charn Tulyapisitchai Member of Audit Committee Mr. Dej Namsirikul is specialized and experienced in accounting and finance. He is an independent director and audit committee director to the Company since 2006.

Meeting of the Audit Committees In 2014 and 2015, the number of audit committeesâ&#x20AC;&#x2122; meeting was 12 meetings and the detail as follows:

Name Pol. Gen. Somchai Vanichsenee Mr. Dej Namsirikul Mr. Charn Tulyapisitchai

No. of Meeting 2015

2014

11/11 11/11 11/11

11/12 12/12 12/12

3) Executive Directior As at 31 December 2015, executive committees consist of 4 directors as follows:

Name Mr. Sadawut Taechaubol Mr. Surabhon Kwunchaithunya Ms. Sudthida Chirapatsakul Mr. Chanachai Joonjiraporn

Position Executive Chairperson Vice Executive Chairperson Executive Director Executive Director

Meeting of Executive Committees In 2014 and 2015, the number of attendance and meeting were as follows:

Name Mr. Sadawut Taechaubol Mr. Surabhon Kwunchaithunya Ms. Sudthida Chirapatsakul Mr. Chanachai Joonjiraporn

No. of Meeting 2015

2014

1212 12/12 12/12 11/12

13/13 13/13 13/13 11/13

30 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

4) Nomination sub-committee As at 31 December 2015, Nomination sub-committee consist of 3 members as follows:

ชื่อ

ตําแหนง

Mr. Charn Tulyapisitchai Pol. Gen. Somchai Vanichsenee Mr. Hong Chye Sim

Chairperson Committee Committee

Meeting of Nomination sub-committee In 2014 and 2015, the number of attendance and meeting are as follows:

No. of Meeting

Name Mr. Charn Tulyapisitchai Pol. Gen. Somchai Vanichsenee Mr. Hong Chye Sim

2015

2014

0/0 0/0 0/0

2/2 2/2 2/2

5) Compensation sub-committee As at 31 December 2015, Compensation sub-committee consist of 3 members as follows:

Name

Position

Mr. Charn Tulyapisitchai Pol. Gen. Somchai Vanichsenee Mr. Hong Chye Sim

Chairperson Committee Committee

Meeting of Compensation sub-committee In 2014 and 2015, the number of attendance and meeting are as follows:

No. of Meeting

Name Mr. Charn Tulyapisitchai Pol. Gen. Somchai Vanichsenee Mr. Hong Chye Sim

2015

2014

1/1 1/1 1/1

2/2 2/2 2/2

6) Good governance sub-committee As of 31 December 2015, Good governance sub-committee consist of 4 members as follows:

Name

Position

Pol. Gen. Somchai Vanichsenee Mr. Surabhon Kwunchaithunya Mr. Priyong Teerasathian* Ms. Duangtida Pankasemsuk

Chairperson Committee Committee Committee

Remarks : * Resigned from the Company, effective 16 September 2015

31 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

Meeting of Good governance sub - committee In 2014 and 2015 , the number of attendance and meeting are as follows:

No. of Meeting

Name Pol. Gen. Somchai Vanichsenee Mr. Surabhon Kwunchaithunya Mr. Priyong Teerasathian* Ms. Duangtida Pankasemsuk

2015

2014

0/0 0/0 0/0 0/0

1/1 1/1 1/1 1/1

Remarks : * Resigned from the Company, effective 16 September 2015

7) Investment Committee As of 31 December 2015, Investment Committee consist of 5 members as follows:

Name

Position

Mr. Somkad Sueptrakul Mr. Surabhon Kwunchaithunya Ms. Duangtida Pankasemsuk Ms. Areeya Positwongsa Ms. Nattcharinphon Jesadapisit

Chairperson Vice Chairperson Committee Committee Committee and Secretary

Meeting of Investment Committee In 2014 and 2015 , the number of attendance and meeting are as follows:

No. of Meeting

Name Mr. Somkad Sueptrakul Mr. Surabhon Kwunchaithunya Ms. Duangtida Pankasemsuk Ms. Areeya Positwongsa Ms. Nattcharinphon Jesadapisit

2015

2014

12/12 12/12 12/12 12/12 12/12

The Company has set up the investment policy as follows: Investment Criterias 1. Allocation of Investment 1.1 To make an investment within approval budget depend on type of investments such as trading portfolio with the proportion of 40 %to 60 %and investment portfolio with the proportion of 40 %to 60 %. 1.2 To manage the short term and long term investment portfolio effectively , the Investment Committee will allocate each type of investment differently under the approval budget from the Board. 2.

Investment in Securities are as follows: 2.1 Trading portfolio is to invest in equity with purpose of gaining from price changes. 2.2 Investment portfolio can be classified as follows: ď&#x201A;ˇ Long term investment portfolio aims to receive dividend from businessâ&#x20AC;&#x2122;s operation. Investment period is more than one year.

32 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

Short term investment portfolio aims to receive from price changes which depend on market situation. Investment period is not more one year. 2.3 General securities account is to invest in securities that is not buy and/or sell at Stock dealing center. After the Company was transferred the investment division to the Parent company, the Company wasn’t invest in any type of investment anymore except investments that needed securities license such as market maker, error portfolio, etc 

3. Limitation of Loss Liquidity and loss limitation are managed at the same time by sell or decrease of investment in any invested securities when the price and/or liquidity of its decreased. If the price of that securities go down by 5 -30 %of cost price (depend on type of investment) , the securities must be sold. If the securities is not sell, it must be quickly report to the Investment Committee for further decision. 4.

Others 1.1 Securities in general account that are trade in Stock dealing center, the Securiteis will transfer to Securities for trade or Securties for investment by judement of the Investment Committee which follow the procedures of securities transfer or accounting standard. 1.2 The Investment Committee will consider to transfer Securities available for trade that remain in the shor term investment accout with the period of more than 1 year to Securitties available for investment by using fair value or follow accounting stardard. 1.3 Pursue and conduct based on the rights of Securities in the Securities company’s account 1.4 Hold a meeting to consider, to review and to follow investment at least once a month with meeting room.

9.2 Management As of 31 December 2015, Management of the Company consist of 19 members are as follows:

Name 1. Mr. Sadawut Taechaubol 2. Mr. Surabhon Kwunchaithunya 3. Ms. Sudthida Chirapatsakul 4. Mr. Chanachai Joonjiraporn 5. Mr. Chupong Tanasettakorn * 6. Mr. Pitsanu Vichicholchai 7. Mr. Priyong Teerasathian** 8. Mrs. Srisakul Boonsiri 9. Mr. Ronnakrit Sarinwong 10. Ms. Suvinun Chavaphansiriporn 11. Mr. Somchai Teeratham 12. Mr. Chatthapat Suttitak 13. Ms. Siriwan Thitisiriwech 14. Mr. Chalam Samsarid*** 15. Mr. Panupong Techaphetpaiboon**** 16. Mr. Ashwani Ahuja 17. Mr. Chamras Kuanha

Position Executive Chairperson Vice Executive Chairperson CEO (Manager) CEO Managing Director IB Division Managing Director Retail Brokerage Division Managing Director Internal Audit and Compliance Senior Executive Vice President Retail Brokerage Division Senior Executive Vice President Retail Research Division Senior Executive Vice President Retail Brokerage Division Senior Executive Vice President Retail Brokerage Division Senior Executive Vice President Retail Brokerage Division Senior Executive Vice President Retail Brokerage Division Senior Executive Vice President Retail Brokerage Division Senior Executive Vice President IB Division Senior Executive Vice President IB Division Senior Executive Vice President Bond Division

33 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

18. Mr. Sombat Chancharoensin 19. Ms. Netchanok Anawan Remarks

Senior Executive Vice President Business Development Head and Vice Managing Director, Accounting and Finance Divison

Resigned from the Company, effective 1 October 2015 Resigned from the Company, effective 16 Septemberr 2015 ***Resigned from the Company, effective 1 May 2015 ****Resigned from the Company, effective 1 December 2015 **

9.3 Secretary of the Company

According to the resolution of Boad of Director’s meeting 7/2015 held on 28 July 2015, the Board has appointed Mr. Pitakphol Roongrojsuwan to act as the Company Secretary. Duties and Responsibilities of the Company Secretary 1. Advise the board of directors on the Company’s laws, rules and regulations and ensure the directors will follow the company’s laws, rules and regulations. 2. Encourage the board of directors to have knowledge and understanding of corporate governance and follow practices. 3. Prepare agenda and notice of the shareholders and board of directors meetings. 4. Arrange the shareholders and board of directors meetings in compliance with the Company’s laws, rules and regulations and good practices. 5. Take minutes of the shareholders and board of directors meetings and ensure related parties will follow resolutions of the shareholders and board of directors meetings. 6. Prepare and maintain the board of directors’ registration, annual reports, notice of the shareholders and board of directors meetings, minutes of the shareholders and Board of Directors meetings. 7. Monitor the directors and management to make reports on their stakeholders including related persons’ stakeholders as specified by the law. 8. Maintain the stakeholder reports reported by the directors or management as specified by laws.

9.4 Directors and Management Remuneration 1) Director remuneration Name Mr. Prayoon Chindapradist, Prof Mr. Dej Namsirikul Gen. Wattana Sanphanich Pol. Gen. Somchai Vanichsenee Mr. Charn Tulyaphisitchai Mr. Sadawut Taechaubol Mr. Surabhon Kwunchaithunya Mr. Hong Chye Sim Mr. Litti Kewkacha* Mr. Somkad Sueptrakul Ms. Sudthida Chirapatsakul Pol.Lt .Gen.Werapong Chuenpagdee Mr. Nipon Wisityuthasart

Remuneration (Million Baht) 2015 2016 1.60 1.04 0.80 0.975 0.865 0.56 0.56 0.58 0.07 0.955 0.56 0.56 0.56

34 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

1.60 1.04 0.80 1.015 0.925 0.56 0.56 0.62 0.49 0.955 0.56 0.56 0.56

Remuneration (Million Baht) 2015 2016

Name Mr. Tommy Taechaubol Mr. Chanachai Joonjiraporn

0.56 0.56

Remarks : * Resigned from the Company, effective 1 March 2015

2) Remuneration for Executive Directors and Management In 2015, the remuneration for 4 executive directors and 14 directors paid as salary, bonus and indemnity (excluding meeting allowance paid to the above-mentioned executive directors) amounted to Baht 113.09 million.

3) Other Remuneration 3.1) Other Remuneration of Director Prof. Prayoon Chindapradist, the Chairperson has been using his own car while the Company compensates all expenses such as petrol, maintenance, and wear and tear which have amounted to Baht 50,000 per month 3.2) Other Remuneration of Executives The Company has set the provident fund. The Company has support 3-5 percents of Executives’ salary to the provident fund. In year 2015, the Company has contributed in the provident fund around Baht 1.58 million In the resolution of Board meeting No.18/2002 on 22 October 2002, a provident fund was agreed upon that was then registered according to the Provident Reserve Funds Act B.E. 2530 and the Amendment Act B.E. 2542. The Company’s provident fund was officially established on 25 December 2002. As of 1 November 2006, the Company changed the asset management company from Finansa Asset Management Company Limited to ING Fund (Thailand) Company Limited. On July 1, 2009, the Company changed the asset management company from ING Fund (Thailand) Company Limited to MFC Asset Management which managed and registered provident fund under name “MFC Master Fund”. This fund is categorized as Master Pooled Fund. According to the Fund’s regulations under the approval of Board’s resolution No 18/2002, the Company shall contribute to the Fund with the amount equivalent to its staff’s contributions, and each staff shall contribute to the Fund the amount calculated on the percentage of salary as follows: Working Period Not over 3 years Over 3 years but not over 5 years Over 5 years up

% of Salary 3 4 5

9.5 Personnel 1) Personnel As of 31 December 2015 , the Company has 673 employees ; 302 were located at the head office and 371 were located at 45 branch offices. All employees were divided as below: No. of Employees Division 2014 2015 Securities division 363 386 Investment Banking division 16 5

35 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

No. of Employees

Division

2014 23 9 11 9 297 728

Information Technology Research division Finance and account Compliance Management division and others Total

2015 26 9 11 6 230 673

2) Significant change in number of employees in the past 3 years The number of employees at the end of 31 December 2015 were decreased by 55 people from the previous year.

3) Serious labor dispute in the past 3 years – none –

4) Total Employees’ compensations Amount (Million Baht)

Type of compensations Salaries and Bonus Marketing’ remunerations and Executives’ Profit Sharing Others Total

2014 398.43 228.70 63.41 690.54

2015 380.43 187.98 40.40 608.81

5) Training policy The Company sets a subcommittee for recruiting employees and provides training service both in house training and outside training. For training objectives is to increase employee skill and support them to perform duties with integrity. All employees must keep all information of the Company and client confidentially.

10. Corporate Governance 10.1 Policy on Corporate Governance The Board strongly believes in good corporate governance. As such, the Board gives full support and encouragement to good governance practices throughout the whole organization under the key principles of integrity, transparency, avoidance of conflict of interest, information disclosure and fair dealing. Our management team focuses on upholding the integrity of the industry, the investment profession, and in putting the interests of clients and shareholders above their own personal interests. The Policy on Corporate Governance is divided into five categories as follows: 1. Rights of Shareholders 1.1) The Board oversees and ensures that every shareholder has the following basic rights:  To receive or transfer shares unless the transfer causes the Company to exceed the number of Non-Thai shareholders quota of 49% of total number of shares outstanding.  To obtain accurate, complete and timely information.

36 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

To propose, appoint or demote directors and to approve the appointment of independent auditors. To make the decision on changes in the Company’s important policy. To obtain profits from operations. To attend the meeting and to vote in the shareholders’ meeting as follows - Nominate, appoint or removal directors - Appoint auditors - Appropriate dividend payment - Issue or amend regulations or articles of associations - Decrease or increase registered capital - Approve extraordinary agenda - Other matters that affect the Company in accordance with the law Every shareholder shall receive a notice of the annual general meeting with adequate information specifying the date, time, place and agenda including concerned matters in advance. The Company shall arrange the shareholders meeting at the appropriate time and place for shareholders to attend the meeting conveniently. All directors are required to attend the shareholders meeting to clarify or answer questions to shareholders. The shareholders shall have an opportunity to propose additional matter in the agenda or ask questions, request for clarification and express opinions appropriately according to the meeting agenda, as a result, the Board should not add any agenda without noticing the shareholders in advance. The shareholders shall acknowledge rules and regulations and voting procedures of the meeting. The Company shall post all agenda on its web site in advance prior to sending documents to the shareholders so that they have adequate time to prepare for the meeting. The Board’s opinions shall be provided in each agenda and the minutes of the meeting is recorded correctly and completely so that the shareholders and concerned persons are able to verify such meeting. All directors and senior executives of the Company are required to disclose their relationship – both direct and indirect ways – with the major shareholders or the third parties who have connected transactions with the Company.    

1.2) 1.3) 1.4) 1.5)

1.6) 1.7) 1.8)

2. Treatment of Shareholders 2.1) The Board oversees and ensures that every shareholder is treated equally as the follows: 1. The Company shall delivery a shareholder meeting invitation at lease 14 days in advance and provides the shareholder adequate information specifying the date, time, place and agenda including concerned matters. Thus, shareholder will have an opportunity to submit questions in advance. 2. The Board shall provide an opportunity for shareholders to submit question in 7 days in advance before the shareholder meeting. 3. Announcement of shareholder meeting will be posted on the newspaper for 3 consecutive days in order to inform the shareholders. 4. The Company will use computer in registration process to consume less time for shareholders. 5. The Company will hold the shareholder meeting on date, time and location that shareholder is able to attend the meeting; and will not sudden change the meeting’s location. 6. The Board shall provide an opportunity for shareholders using power of attorney for proxy forms to pre-indicate his/her voting direction and propose at least a name of Independent director for shareholders to grant their proxy. In the ordinary annual shareholder meeting 2013, shareholders granted their voting rights to Mr. Charn Tulyaphisitchai (Independent Director) to vote on their behalf.

37 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

7. The Chairperson of the Board of Directors shall inform rules and regulations of voting procedures, and number of shareholder attended the meeting to shareholders in the meeting. 8. Shareholders who is executive shall add no agenda without informing in advance. 9. Each share has equal rights. The shareholders have the rights to vote according to the number of shares hold. In addition, they shall have equal rights to obtain news and information about the Company. 10. The Chairperson of the Board of Directors shall begin the agenda in order as informed in the meeting invitation. 11. The Chairperson of the Board of Directors shall allow the shareholders to discuss and ask question. 12. The Board shall encourage the use of voting forms for important matters such as related transaction, acquisition, sale of assets, and election of the Board. 13. In the shareholders meeting, all shareholders who are executives, non-executives and foreign shareholders shall be treated equally and fairly. 14. All shareholders who attend the meeting shall have the right to vote as agree, disagree or abstention on each agenda. 15. The Board shall provide an opportunity for shareholders to elect director individually. In the ordinary annual shareholder’s meeting for 2015, there were 7 shareholders counting as 29,113 shares and were 22 people granted voting right from the shareholders counting as 2,571,307,709 shares. Therefore, total number of people attended was 29 people counting as 2,571,336,822 shares which accountable for 99.29 %of issued shares which followed the Company’s regulation. 2.2) Supervision on Use of Inside Information The Company prohibits directors, executives, and all staffs to trade equity and derivatives by using inside information, and sets clear guidelines to prevent usage of inside information as follows: The Company has set a code of conduct and has prohibited all executives and staffs to take advantage of the Company’s Watch List, Restricted List, and Research List for securities trading purpose.  The Company has issued regulations and guidance on measurement of confidentiality of client information and proper firewall to minimize information flow (Chinese wall).  The confidential information shall not be disclosed to the public.  The Company has issued regulations and business ethics for all members of management and employees in written and those who breach the regulations will be severely penalized.  The Company has designated the audit and compliance division to oversee that all members of management and employees from all division perform their duties in accordance with the relevant laws and regulations. 2.3) Policy on Supervision on Use of Position for Personal Benefits 1. In accordance with Section 59 of the Securities and Exchange Act. B.E. 2535, directors and executives are required to report a change of securities holdings to the Securities and Exchange Commission and the Stock Exchange of Thailand . 2. The Company’s directors, executives and staff who relate to internal information are not allowed to disclose such information to any outsiders or unrelated persons. 3. The Company’s directors, executives and staff who relate to the preparation of financial statements or related information are not allowed to trade the Company’s securities before earnings release. 

38 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

2.4) Policy on Conflict of Interest The Company has not allowed the directors, executives and staff to operate a competing business and to make connected transactions which may lead to conflict of interest. In the event that connected transactions are required, the Board of Directors will oversee connected transactions made transparent and fair as if the Company deals with outsiders. The directors, executives or staffs who are stakeholders are not allowed to consider and approve these transactions. In case those transactions are considered as connected transactions under the notifications of the Securities and Exchange Commission or the Stock Exchange of Thailand, the directors will strictly oversee transactions made in accordance with regulations, methods and disclosures of information concerning connected transactions of listed companies. 2.5) Policy on connected transactions of the Company, subsidiaries, associated companies and corresponding subsidiaries, which are divided into two parts as follows: 1. Measure to control connected transactions The Company has issued measures to control making connected transactions of the Company, subsidiaries, associated companies and corresponding subsidiaries with individuals who may have conflicts of interest, personal interest or possible conflicts of interest as stipulated by the notifications of the Securities and Exchange Commission or the Stock Exchange of Thailand. The Company’s audit committee will give a view on a necessity to make connected transactions and appropriate prices which will depend on conditions in accordance with a guideline on normal trading and enable to compare the price with outsiders. In the event that the audit committee is unable to consider connected transactions, the Company will seek an independent expert or the Company’s auditor to act as a viewer of such connected transactions for further consideration of the Company’s Board of Directors and/or audit committee and/or shareholders, as the case may be. Those who may have conflicts of interest or personal interest in connected transactions shall not be entitled to vote for the approval of connected transactions. In addition, the Company will disclose information of making connected transactions and vital asset acquisition or disposal of the Company and its subsidiaries in accordance with the notifications of the Securities and Exchange Commission or the Stock Exchange of Thailand and the accounting standard of the Institute of Certified Accountants and Auditors of Thailand. 2. Policy or Tendency on Possible Connected Transactions The Company, subsidiaries, associated companies and corresponding subsidiaries may make possible connected transactions with individuals who may have possible conflicts of interest. In the event of being normal business transactions and normal business supporting transactions with general trade conditions with individuals who may have conflicts of interest, especially subsidiaries of Country Group Securities Public Company Limited., the Company has set a policy on connected transactions by providing various conditions in accordance with the nature of normal business operations in the market which can compare the price with outsiders pursuant to a principle approved by the Company’s Board of Directors under the Securities and Exchange Act. B.E. 2535. Related parties must strictly follow a joint agreement and set a clear and fair price and terms and not lead to transfer of benefits. Making new connected transactions or changing prices or conditions, the Internal Audit and Compliance Department must investigate information and prepare quarterly reports to the Audit Committee for consideration and recommendation on the appropriation of prices and reasons for making connected transactions. In case of other normal business, normal business supporting and connected transactions, the Company will follow the aforesaid measure to control connected transactions.

39 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

3. Role of Stakeholders The Board serves to assure equal treatment of stakeholders - clients, shareholders, investors, creditors, partners, management, employees, independent auditors, public sector, society and other concerned entities. As such, the company must comply the following: 3.1) Policy on Safety and sanitation The Company improved working environment by expanding work space to reduce congestion and for a better working quality. Therefore, the Company’s employees can create an excellent working performance and improve their capability. Also, the Company provides health insurance for its employees. 3.2) Policy on Employee Compensation and Benefits The Company has set a policy on employee compensation and benefits to which the KPI method is applied for evaluating performance to pay compensation to staff equally and fairly. The Compensation Sub-committee is appointed by the Company’s Board of Directors has overall responsibility for considering and determining appropriate payments. 3.3) Establishment of Employee Provident Fund Provident fund ("the fund") is a fund set up voluntarily between employers and employees. Asset of the fund consists of money contributed by both employers and employees. This means employees are not alone in saving the money, employer help them at the same time. The contribution to be made by employer will always equal or exceeding that contributed by employees. Therefore, set up of provident fund can be regarded as a kind of benefit that could motivate employees to work with employer. Provident fund not only provides a tool for employees to save consistently with the employer's assistance, asset of the fund is further managed by a professional called "Asset Management Company" The benefit derives from management is distributed to member of the fund proportionately. 3.4) Policy on Human resource development Employees have been trained to enhance personnel development and have been instilled to practice their job with honesty as well as keep clients’ information confidential. 3.5) Policy on Violation of Human Rights  Support and respect the protection of human rights, prevent oversea the Company’s operations from human rights violations. For instance, the Company should seek to eliminate forced labor and child labor.



Treat all stakeholders fairly and respectfully without discrimination as to race or ethnic origin, gender, age, skin color, religious, body, status or family.

3.6) Policy on Client responsibilities The Company aims to offer a highest clients’ satisfaction therefore the Company must responsible to the client with clear and fair practice according to the rules and regulations in dealing with clients. The clients are also delivered accurate information with transparency. Furthermore, the Company has provided a communication channel where clients can leave their complaints, and has set guidance and procedures on dealing with the client’s complaints in a careful and fair manner.

40 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

Furthermore, the Company has participated in the Dispute Settlement by Arbitration which facilitated by Securities and Exchange Commission (SEC). In the case that the client has any dispute or arbitration issues regarding the Company’s business conducts, the client could file for settlement by arbitration; however, the dispute must equip with the conditions indicated by SEC. 3.7) Policy on Competitor responsibilities The Company must conduct the business with clear and fair practice according to the rules and regulations particularly the rates of commission fee charged in both securities and derivatives trading. Also, marketing officers and head of marketing team are treated fairly with appropriate remuneration. 3.8) Policy on Suppliers The Company shall treat suppliers equally according to term and conditions specified in the contract without a violation of laws such as using copyright software. 3.9) Policy on Creditors The Company is promising to deal fairly with creditor in terms and conditions which indicated on the loan agreement, principal and interest‘s repayment, and the collateral agreement 3.10) Policy and practice on Intellectual property or copyright  The Company supports our employees to do their works without violating the law or intellectual property law such as trade mark , patent, copyright and other intellectual properties,  The Company‘s employees have right to create and invent their work independently under the law specified except the works that generate from work and use of the Company’s data are property of the Company. However, if the Company clearly permit that the invention is belong to its employees, the right of invention belong to them.  The Company supports its employees to realize an important of intellectual property right in workplace and daily life.  Before using any data or information, a person who uses the data or information must inspection the intellectual property right before use. 3.11) Policy and practice on corruption  Manage to have effective internal control and risk evaluation to prevent corruption, and improper behavior of employees and outside people who related to the Company.  Encourage honesty and responsibility as organization culture as well as increase awareness of corruption that is wrong behavior.  To have a transparency of financial report under universal accounting standard.  Provide channel for employees to report, suggest or complain regarding corruption.  Determine to have preventive measure for give and receive gifts, give dinner of welcome, or excess expense that over the Company limit or violate law of related countries.  Determine to have preventive measure for any bribery that directly or indirectly facilitate the relationship in doing business.  Specify a clear and fair procurement under proper procedures and rules.  Specify a transparent of any money donation.  Encourage employees to exchange and share proper guidelines among other companies in the same industry including all related stakeholders in order to join anticorruption activities hold by associations, chamber of commerce or others compliance units.

41 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

3.12) Policy and practice on Social CGS is always aware of our social responsibilities to the community that we are a part of. We dedicate to act in a socially responsible way in our interactions with all stakeholders. In each year, CGS allocates partial budget to support corporate social responsibilities (CSR)’s activities by focusing on three areas such as education, religion, and social improvement. In 2015, there were many education projects, religious projects, and social projects. 3.13) Policy on Use of Resource  Maintain asset of the Company in good condition and prevent them from breakage and loss.  If any employee who responsible for particular asset and lose it, this person should co-responsible with the Company according to rules, regulations, or policy stated.  Well use the Company’s asset by concerning environment and energy.  The Company’s asset is not allowed to indirectly and directly use for employee own interest.  Employee must return all assets including data use for work when he or she is not the Company’s employee. The data is not allowed keep in any form such as duplicate. 3.14) Policy on Environment  Act according to law and requirement about the environment  Encourage employees to learn about the environment in order to instill responsibility toward the environment.  Encourage employees to exchange knowledge and experience about the environment among employees or departments within the Company.  Encourage and support employees to regularly improve their working condition to suit environment.  The Company has management policy that prevents impact of operation from environment. Additionally, the Company acknowledges the rights of shareholders according to the specified law and encourages cooperation between the Company and its stakeholders for sustainable business growth. All stakeholder groups are treated equally and fairly, and the information is disclosed fairly and timely to all related parties in accordance with the SET’s procedures. 4. Information Disclosure and Transparency 4.1) Information Disclose 1. Provide accurate information in both Thai and English with transparency and disclose consistently via the Company’s website . Also the information should be up to date. 2. Provide and disclose information to the Company’s Director and/or the Company’s executive upon request. 3. Assign specific persons or departments to disclose information to shareholders, investors, analysts, mass media or supervisory units. 4. Details of information which shall be disclosed consistently are:  General information and type of business  Financial statements and operating performances and researches  List and shares proportion of major shareholders and executives  Risk factors of business  Policy on directors and senior executives’ remuneration  Directors’ qualification information

42 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

 Connected transactions  Code of ethics and practices 5. Prepare financial statements or financial information to show financial status and operating performance as required by law and disclose other information in a complete, accurate, sufficient and timely manner so that shareholders and stakeholders are informed accordingly. 6. Arrange to have financial statements audited by an independent external auditor. 7. Facilitate analysts, investment advisors, brokerage firms, credit rating institutions, mass media and external supervisory units, and etc. in the best interest of investors. 8. Disclose policies on corporate governance and operating performance in the annual report website, as well as announcing them at the head office and all branches. 9. Disclose roles and duties of all committees, the number of meetings and attendances, directors’ opinion including a policy on directors’ and senior executives’ remuneration in the annual report and the Company’ s website 10. In accordance with Section 59 of the Securities and Exchange Act BE 2535, the directors have a duty to report trading/holding of company’s securities to the Board every month. 4.2) Director’s Report The board of directors is responsible for the accuracy of the Company’s financial statements as well as those of its subsidiaries included in the Annual Report. Thus, reporting is prepared carefully after every meeting to specify the responsibility of the Board for the consolidated financial statements of the Company and its subsidiaries and other important matters according to the standard practices suggested by the SET along with the audit report, as shown in the annual report. Under the structure of the Company’s Board, it has provided the adequate independent directors to balance the power as specified by the regulators’ rules. In turn, the Audit Committees consist of individuals who have adequate knowledge and experience to review the quality of financial reports including disclosure of important information in the notes to the financial statements and to discuss necessary issues with compliance and 2015, the Audit Committee has proposed and appointed Mr.Chavala Theinprasertkit and/or Mr.Permsak Wongpatpagorn and /or Mr.Niti Jungnitnirundr and/or Ms. Nisagorn Songmanee of Deloitte Touche Tohmatsu Jaiyos Audit Co., Ltd. to act as the auditors of the Company for the year 2015. 4.3) Investor Relations The Board realizes the significance of accurate, complete, and transparent disclosure of the Company’s financial and non-financial information including those that may have impact on share price and investor sentiments. As such, information must be provided in a manner that is also timely and consistently to all investors and stakeholders for their decision making according to the rules and regulation of the SET. The Company shall disclose such information through various channels such as reports to the SET, Company website (www.cgsec.co.th). To disseminate accurate and reliable information as well as to eliminate rumours or misleading information, the Company has assigned the chief executive officer to be responsible for answering any questions and clarifying any information of the Company to investors and relevant parties. Investors can contact this person by telephone at number 0-2205-7000 ext.1018, or at e-mail address: PR-CGS@countrygroup.co.th. In addition, the Company has assigned the audit and compliance division to respond to clients’ complaints and can be contact by telephone at 0-2205-7000 ext. 1300-11.

43 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

5. Board Responsibilities The Board’s main objective is to instill leadership and to guide the Company in a direction that will bring success to its stakeholders. As such, the Board’s duties and responsibilities includes the following; to set and ensure that policies are adhered to, to approve the Company’s business strategy, objectives, corporate plan and budget, to oversee adequate risk management, and to oversee effective and transparent implementation by the management team. 5.1) Structure of the Boards 1. Balance of Power of Directors The Board consists of at least 5 directors but not more than 15 directors, who are skilled, experienced, dedicated, and equipped with knowledge and independent judgment to share in Board meetings. In addition, each director must possess qualifications specified by law. Also, one third of the Board or at least 3 members constitution are independent directors. An appointment to the Board is subject to pre-set agenda with transparent and clear nomination of well-profiled directors. The Company shall disclose the profile of all directors in detail, including any changes made to the public through the Company’s website, internal media ,head office and also at every branch office. 2. Qualifications of Directors and/or Independent Directors A number of independent directors are not limited to a specific number. The Board elects a member of independent directors based on his/her knowledge and experience that best benefit the Company ;however, his/her qualifications should meet the requirement of SEC and the Act of Public Company Limited. Moreover, the independent director shall not take position over 9 years since the day he/she is appointed as independent directior for the first time. 5.2 Sub-Committees The Company consist of 7 committees which are the Board of directors, the Audit committee, the Executive committee, the Nomination subcommittee, the Compensation sub-committee, the Investment committee, and the Good governance committee. Seven committees are set up to monitor the Company in different areas.  Leadership, Vision, and Independent Decision The Boards main objective is to instill leadership and to guide the Company in a direction that will bring success to its stakeholders. As such, the Board’s duties and responsibilities includes the following; to set and ensure that policies are adhered to, to approve the Company’s business strategy, objectives, corporate plan and budget, to oversee adequate risk management, and to oversee effective and transparent implementation by the management team. In addition, the Board sees the importance of good corporate governance and emphasizes on good internal control and effective risk management which is regularly reviewed in board meetings. Thus, it is essential that the Board comprise of directors who have leadership and vision, as well as capability to make independent decisions for the highest benefits of the Company and the stakeholders.  Conflicts of Interest The Board has set clear guidelines to prevent conflicts of interest. These are listed below as follows:  To have a well-structured organization chart, whereby each functional unit can be monitored for performance with relevant committees to oversee internal control for adherence with external regulatory bodies.  Encourage all employees to adhere to good corporate governance by promoting working principles of integrity, professional ethics, client confidentiality, and no usage of inside information for own interests.

44 Annual Report 2015 COUNTRY GROUP SECURITIES PCL



  

For situations dealing with conflicting stakeholder interests, the Board and management shall consider the each carefully, honestly, reasonably, and independently for the best benefit of the Company, with the resulting decision disclosed to shareholders. In cases of conflict of interest or related transactions, all related directors must disclose such information to the meeting immediately and shall not have the right to attend nor vote for that agenda. Directors, executives and all staff should avoid any transactions that may lead to conflict of interest as a result of taking advantage of inside information. Directors, executives and all staff should avoid holding shares in the business of its competitors that might affect their duties or responsibilities. In the case that such person holds shares before employment OR prior to the Company to operate the same business, the person must report to his/her relevant supervisors and send a copy of the report to the audit and compliance division.

 Business Ethics The Company strongly upholds its business ethics to the utmost importance in achieving long term success, business targets and in maximizing shareholder’s wealth. The Board has set a code of conduct for employees to follow and use as a guideline to perform each dedicated task with honesty and integrity to the Company, and all stakeholders. In addition the Company has established a set of punitive courses for those in breach of the code of conduct which is regularly monitored by the audit and compliance division.  Internal Control and Audit and Financial Report The Company bestows serious attention on internal control system at both managerial and operational levels, focusing on adequacy and appropriateness for the prevention of damages that may occur to the Company’s financial and business operations. The Company has set up internal control and audit policies as follows:  Management is assigned to prepare accurate, complete and timely financial reports both quarterly and yearly.  Efficient internal control and audit systems to ensure that the Company adheres to all relevant standards and laws which in turn is under the investigation of internal auditors and review of the audit committee.  The Company has clearly defined in writing the responsibilities and authorities of the management team.  Continuous monitoring and auditing of Company assets to avoid damages or exploitation.  Segregation of duties in order to have an appropriate system of check and balance.  The Board gives importance to advice or suggestions made by independent auditors and regulatory bodies in helping the Company to further improve its operational practices.  An audit and compliance division that reports directly to the audit committee to ensure independent judgment.  Policies to recruit reputable external auditors approved by the SEC in order to audit, advise and rectify any weaknesses or errors of the internal control system. 5.3) Meeting of the Board of Directors 1. The Board schedules normal meetings in every month so that directors can allocate their time accordingly. Additionally extra board meetings can be held if necessary. In every normal meeting the Board will follow up on the progress of issues from previous meetings and monitor all operating performances of the Company. 2. Each Board meeting must consist of at least half the members present.

45 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

3. The chairperson will approve the proposed agenda as advised by the executive chairperson and will consider other matters in the agenda proposed by any director in the meeting. Hence, each director is able to independently propose other matters in the agenda. 4. The chairperson shall give sufficient time for management to propose each matter or search for supporting documents in order to carry out a proper discussion. 5. The Board shall notify the Chief Executive Officer to invite senior executives to attend a Board meeting in order to directly provide additional information on specific issues. 6. The Board may ask for additional information from the Chief Executive Officer or other assigned executives or request for independent opinions from external consultants. 7. The management shall be responsible for giving proper information, advice and services to the Board in a timely manner. 8. The Board has a policy for non-executive directors to hold a meeting at least twice a year to discuss various problems without presence of management. The result of the meeting will be reported to the Chief Executive Officer. 9. The secretary of the Board shall send an invitation letter together with the agenda and supporting documents to every director in advance of no less than 7 days so that directors have adequate time to review the information. 10. In every Board meeting, the secretary shall keep record of the minutes of the meeting for future reference. 5.4) Evaluation of the Board of Directors The Board encourages regular self-evaluation by considering and analyzing results, problems and obstacles for future improvement. The Boardâ&#x20AC;&#x2122;s performance is evaluated on an overall or specific case basis, not focusing on any individual director. 5.5) Directors and Management Remuneration The Company has set directors remunerations clearly and transparently. Such remuneration is approved at the annual general shareholders meeting. In certain circumstances that a director is assigned to perform more roles with greater responsibilities such as being members of the sub-committee, they shall be rewarded accordingly. The Company has formed Compensation Subcommittee to consider remuneration for the management team with fairly rate. Furthermore, Compensation Subcommittee will consider the number of warrant assign to director, top management, or employees. Executive director or employee, who is assigned to receive securities more than 5% of allocated securities, must not a member of Compensation Subcommittee. Disclosure of all relevant remuneration is displayed in yearly annual reports and on the Companyâ&#x20AC;&#x2122;s website. 5.6) Development of Directors and Executives 1. Report and summarize all rule and regulations to the Board and Executives regularly. 2. Encourage the directors to learn and understand the roles and responsibilities practices in equity market. 3. A new director must be approved by the SEC and SET. 4. A first time director will acknowledge the company profile, rules and regulations and director handbook. The Company has regularly been interested and inquired by the customers in derivatives trading. During the last 4 years, the company has achieved the following rewards: 2012 - TFEX on Spot Daily - Money Expo Bangkok 2013 - First Place - TFEX Broker Champion - Money Expo Chiangmai - Second Place - TFEX Broker Champion - SET in the City 2013 2014 - First Place - TFEX Broker Champion - Money Expo Bangkok

46 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

2015

- Third Place - TFEX Broker Champion - SET-TFEX Online Investor Fair - Third Place - TFEX Broker Champion - Money Expo Korat - Second Place - TFEX Broker Champion - SET in the City 2014 - Third Place - TFEX Broker Champion - SET-TFEX Digital Investor Fair - Third Place - TFEX Broker Champion - SET in the City 2015

10.2 Corporate Governance on Management Authorities and Duties of the Board of Directors  Set the Company’s policy, mission and objectives in accordance with the Public Company Act, rules and regulations by the SEC, SET and external supervisory units, and the resolutions of the shareholders’ meeting.  Approve the Company’s annual corporate plan and budgets.  Appoint the executive board to manage the Company.  Determine a list of authorized signatory directors.  Appoint persons to replace directors resigning before the terms expired.  Appoint, remove, and terminate the employment of the Executive Chairperson and President, as well as approve their salaries, remunerations or other benefits.  Approve the budget on employee’s salaries, bonuses, and other benefits.  Approve the Company’s financial and assets transactions.  Perform other duties in achieving the Company’s policy, mission and objectives.  Hold board meetings. Authorities and Duties of the Audit Committee  Review financial reports to ensure their accuracy and adequacy.  Review internal control systems and audit functions to ensure their appropriateness and effectiveness as well as independency of compliance division. Also appoint, remove, and transfer Vice President of Internal audit department or related department.  Review the Company’s operations and activities to ensure their compliance with Securities Company Act, SET regulations and other applicable laws.  Consider and propose auditors as well as their remunerations. Also attend auditor meeting with no management persons involved at least once a year.  Review information of related transactions or any transactions in conflicts of interest to ensure their accuracy and completeness.  Prepare and disclose audit committee reports in the annual reports which must be signed by the chairperson of audit committee. The report must consist of the following: 1) Agreement on accuracy, adequacy and reliability of the Company financial statements 2) Agreement on adequacy of the Company’s internal control 3) Agreement on SEC and SET conducts or related business laws 4) Agreement on appropriateness of Auditor 5) Agreement on the Company’s related transaction 6) Attendance and number of Audit committee’s meeting 7) Agreement on duties of Audit committee comply to Charter

47 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

8) Other transactions that shareholders and investors should notice under duties and responsibilities delegated by Executive Board.  Perform any deeds assigned by the board, provided that the committee accepts such assignments.  Report any suspect transactions that may affect the Company’s financial and operational status to the Board of Directors for revision. 1) Conflict transaction 2) Corruption or fraud of internal control 3) Violation of securities law or business law In case that Board of directors or Executive board ignores to revise any irregular transactions within a certain period, any Audit committee shall report to SET or SEC. Authorities and Duties of the Executive Board  Manage and oversee the Company’s operation and administration in accordance with the Board’s resolution on policy, mission, objectives, and annual corporate plan and budget.  Recruit, appoint, remove, and transfer senior executive vice presidents and executive vice presidents as well as approving their salaries, remuneration or other benefits.  Appoint, remove individuals or juristic persons to be the advisor of the executive board. In addition to approve remuneration to such persons.  Execute assignments from the board.  Hold executive board meetings. Approval of executive board meeting is based on majority vote. One executive board is eligible for one vote except whose that related to topic in the meeting, he or she will have no voting right. If the number of vote is equal, chairperson of executive board will have one more voting right. In the case of situations that require urgency, the Executive chairperson shall have the authority to consider with discretion in proceeding and approving matters within the authority of the executive board or the matters not specified herein; and shall report those actions to the executive board. Authorities and Duties of the investment committee To study and to consider on securities for the account of company to obtain maximum returns according to the policy and the frame determined by the Board of Directors of the company, while the Investment Committee is independent separately from marketing department and other work section. Authorities and Duties of the CEO and President  Propose bonus policy and co-approve bonus payment of all level of employees to the remuneration committee and the Board of Director for final approval. Bonus payment is considered based on the Company’s operating result and employee’s performance.  Co-approve compensation for marketing officer, head of marketing team, and head of marketing branch.  Report to the Board of Director and Executive Board.  Recruit, appoint, remove, transfer, and promote all levels of employees below managing director level.  Adjust salary of all levels employees below managing director level.  Punish employees who violate the employment agreement.  Manage other matters that assigned by the Board of Directors and Executive Board.

48 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

Corporate governance of the Company’s operation The Board of the Company has set the policy to control and manage corporate governace of the Company and invested businesses in accordance with the corporate governance of the Company’s subsidiary and it associate, following SEC and SET announcement. The Company believes that good policy and criteria of corporate governance will promote efficiency and effectives that lead to increase shareholder’s trust toward the Company.The policy are classified into 2 areas: 1) Policy on Corporate Governance of management 1.1) The Parent company has set the guideline of voting in annual shareholder meeting of the Company’s subsidiary and its associate through the Parent company’s representative on the important agenda such as approval of the minutes of the statutory meeting, approval of financial statements, selecton of director, remuneration, selection of auditor and compensation, and profit allocation. 1.2) The Parent company has set up the policy on corporate governance of the Company and its asscociate as a single unit of the Parent company. In order to directly and indirectly control the Company and its asscociate as well as mornitor the Parent company’s benefits, the following matters must be approved by the Board of the Parent company and the shareholder meeting: 1.2.1) Topics that needed approval from the Board of the Parent company 1. Appoint or nominate a name of person to be director or executive in the Company and/or its associated company. Appointed Director and executive has power to decide in the matter of general management and operation (except mentioned in 1.2.2) in the Board meeting of the Company and its associate.Director or executive who name is nominated must show in the White List and his/her qualification must be reliable according to the Announcement of SEC. 2. Consider of dividend payment of the Company 3. Edit the regulation of the Company except the significant ly important matters in 6. 4. Approval of annual budget of the Company. The items 5 -13 is very important that any change will affect financial and operating status of the Company’s subsidiary, therefore the Board of the Parent company must approve first. The items that needed approval are as follows: 5. The Company agrees to do transaction with related party of the Company’s subsidiary , acquisition transaction or sale of asset of its subsidiary 6. Transfer or waiver of benefits including waiver of claims 7. Sell or transfer partly or all of its subsidiary’s business to other person 8. Purchase or transfer business of other company , and later belong to the Company. 9. Partly or majorly Edit or terminate a rental contract of the Company by allowing others to manage. 10. Rental or hire-purchase main business or asset of the Company 11. Loan, credit guarantee, any business transaction that increase financial burdle or financial support to other person that is not involve with business of the Company’s subsidiary 12. Termination of the the Company 13. Other transactions that are not general business transaction of the Company’s subsidiary. 1.2.2) Item that needed approval from the Shareholder meeting of the Parent company with no less than 3/4 of total vote of the shareholder who attend the meeting. 1. The Company agree to do transaction with related person of the Company ; or acquisition or sell of its asset .

49 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

2. Capital increase of the Company and registered capital decrease that share holding proportion is changed, resulting in voting right is less than 10 %. Or the Company’s voting right is less than 50 % in the shareholder meeting of the Company. 3. Any transaction that indirectly and directly affect percentage of voting right in the shareholding meeting of the Parent company by less than 10 %. Or the Company’s voting right is less than 50 % in the shareholder meeting of the Company for uncommon business transactions. 4. Termination of the Company. If the size of the Company and the Parent company is compared and the calculated size is needed to be approve from Shareholder meeting of the Parent company. 5. Other uncommon transactions of the Company and that significantly affect the Company. If the size of the Company and the Parent company is compared and the calculated size is needed to be approve from Shareholder meeting of the Parent company. 6. Edit regulations of the Company that significantly affect operating and financial status. 1.3) The Parent company’s board of directors will monitor the operation of the Company and its associate to make sure they follow the Parent company’s business and budget plan. Moreover, the Company shall disclose connected transactions or , acquisition or sell of its assets to the Company according to announcement of SEC. 1.4) The Parent company’s director must control the Company to have adequate and strict internal control to prevent corruption. The Company should have clear communication channel so the Parent company ‘s directors and executives can receive information and monitor its operation and financial transaction between the Company and , directors and executives. Furthermore, the Parent company ‘s internal audit and independent director can directly access information and audit report in order to make sure that the Company follows the established system. 1.5) Directors and executives of the Company must disclose personal information and related person to the Parent company’s board in order to prevent conflict of interest transaction. The Board of the Company have to inform the Parent company’s board within a certain period of time for making any decision or approval. The decision is truly based on benefits of the Company and the Parent company. Additonally, directors of the Company shall not approve any transaction that relate to his/her own interest or directly and indirectly conflict the interests. 1.5.1) Transactions between the Company and, executive director or related person that is not follow the rules and regulations of related transactions. 1.5.2) Use internal information of the Parent company and the Company except the information is published. 1.5.3) Utilize property or business opportunity of the Parent company and the Company and violate the criteria and general practice of the SEC announcement. 1.6) The Company has to report its business plan, business expansion, major investment project as well as join venture with others to the Parent company through monthly report. The Parent company has a right to ask the Company to submit any attachment , which its subsidiary must follow. 1.7) The Company must submit related information upon request. 1.8) If the Parent company finds any uncommon, the Company must clarify and/or provide the required document. 1.9) Director, executive, employee , or assigned person from the Company and its associate is prohibited to use internal information of the Parent company for their own interest. 1.10) Director, executive, or individual who involved with the Company is allowed to do transaction with the Company if the transaction is approved from the Parent company’s board.

50 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

2) Policy on financial control of the Company’s subsidiary and its associate 2.1) The Company and its associate have to submit monthly operating report and audited quarterly financial statements ; and also allow the Parent company to use the information in consolidated financial statements or the Parent company’s quarterly report. 2.2) The Company and its associate have duty to create operating budget , make operating comparison quarterly, and report to the Parent company. 2.3) The Company and its associate should report any significant problem to the Parent company or upon request. 10.3 Supervision on Use of Inside Information The Parent company sets clear guidelines to prevent usage of inside information as follows: 1) The Parent company’s board and executive including their spouse and immature children have to inform a shareholding status in accordance to rules and regulation of SET and SEC. 2) The Parent company prohibits directors, executives, employees and employees of its subsidiary to use inside information that is not published. 3) The confidential information shall not be disclosed to the public. Confidential information is classified based on important level such as public , disclosure, confidential , and most confidential. Use of information should be limited to specific task. The Parent company’s confidential information shall not be disclosed. 4) Disclose information must be approved from Chief Executive Officer/ Division/Assigned person only. The Parent company has issued the rules and regulations of supervision on use of inside information in written and communicated to directors, executives and all employees.

51 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

10.2 Transaction approval

10.4 Auditor 's Remuneration Audit Fee In 2015, the Company was approved from the general meeting of shareholders to pay Baht 2.50 million for audit fee. Non Audit Fee - None -

11. Social Responsibilities The company significantly aware of Corporate Social Responsibilities and we also strongly performs and believes in corporate governance that will lead us to sustainably growth. Moreover, our core corporate value and cultures consists of honesty, managementâ&#x20AC;&#x2122;s moral and social responsibilities. Furthermore, we have a policy of management with transparency which will be able to be audited to shareholders. The transparency policies deliver good benefits to all parties. 1. Fair Business Practices The company strongly support and encourage a good business practice that strictly follow rules and regulations especially rules and regulation of commission rate and compensation to marketing officer. The company do business with all partners comply with the conditions specify in contract. The content of conditions shall not violate any intellectual property such as computer programs. Furthermore, the company always do business with good governance and fair. The

52 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

company strongly perform and follow all contract conditions that make with creditors or suppliers including paying debts, principle and interest to all service providers and suppliers. 2. Anti- Corruption and Bribery The company has had a policy against corruption, not receive / pay bribes. (Corrupt) to benefit business and report inappropriate actions by the company and provide a practical guide for employees that are prepared to guide them in the act and behave as provided in good faith, not exploitation or call stipend is implied or intent to the malpractice, both directly and indirectly. 3. Human Right The company support and respect the protection of human rights. For instance, the Company should seek to eliminate forced labor and child labor. Furthermore, the Company should treat all stakeholders fairly and respectfully without discrimination as to race or ethnic origin, gender, age, skin color, religious, body, status or family. 4. Respect to employees  The Safety and Health of employees The company improved working environment by expanding working space for reducing congested area for better quality of life, more creativity of work and develop employees competency. Moreover, the company also provides health insurance to all employees.  Human Resource Development The company sets a subcommittee for recruiting employees and provides training service both in house training and outside training. For training objectives is to increase employee skill and support them to perform duties with integrity. All employees must keep all information of the Company and client confidentially.  Salary, Remuneration and Welfare Management for employee The Company uses KPI system to evaluate fairly employee performance which subcommittee will be consider compensation based on KPI.  Establishment of Employee Provident Fund Provident fund ("the fund") is a fund set up voluntarily between employers and employees. Asset of the fund consists of money contributed by both employers and employees. This means employees are not alone in saving the money, employer help them at the same time. The contribution to be made by employer will always equal or exceeding that contributed by employees. Therefore, set up of provident fund can be regarded as a kind of benefit that could motivate employees to work with employer. Provident fund not only provides a tool for employees to save consistently with the employer's assistance, asset of the fund is further managed by a professional called "Asset Management Company" The benefit derives from management is distributed to member of the fund proportionately. As of 31 December 2015, the Company has total employee of 673 members that consists of marketing officers 386 persons and operating officers 287 persons. On 22 January 2015, the company has organized the big activity “Staff thank you party” in order to build good relationship among employee. The objective of this event is for sincerely thank you all employees for fully contribute to the Company all through the year 2014. 5. Client Responsibilities The Company aims to offer a highest clients’ satisfaction therefore the Company must responsible to the client with clear and fair practice according to the rules and regulations in dealing with clients. The clients are also delivered accurate information with transparency. Furthermore, the Company has provided a communication channel where clients can leave their complaints, and has set guidance and procedures on dealing with the client’s complaints in a careful and fair manner.

53 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

Furthermore, the Company has participated in the Dispute Settlement by Arbitration which facilitated by Securities and Exchange Commission (SEC). In the case that the client has any dispute or arbitration issues regarding the Company’s business conducts, the client could file for settlement by arbitration; however, the dispute must equip with the conditions indicated by SEC. 6. Environmental Conservation The Company has many policies about environmental conservation which also build employees awareness toward environment such as  Strictly follow and comply with environmental laws and regulation  Encourage employees to train about caring environment for creating environment responsibility  Support employees to share knowledge and experience about environment among employees  Inspire employees to care environment and continuously develop working process to match with environmental situation. The Company has management policy about caring environment. Environmental policy continuously reviews and evaluate with its performance. 7. Social Responsibility The Company is always aware of our social responsibilities to the community and dedicate to act in a socially responsible way in our interactions with all stakeholders every year. The Company allocates partial budget to support corporate social responsibilities (CSR)’s activities such as education, religion, and social improvement. In 2015, there were many education projects, eligious projects, and social projects. The detail is as follows: Education Train and seminar to education institute about investment knowledge such as Rangsit university, Krirk university , Rajamangala University of Technology Phra Nakhon, Rajamangala University of Technology Thanyaburi , Rajamangala University of Technology Rattanakosin, Suranaree University of Technology , Nakhon Ratchasima Rajabhat University, Naresuan University , National Institute of Development Administration (NIDA), Thammasat University and student of New Investors Program for Society (NIP) as well as provide company visit. Religious 1. Co-Hosted in offering of robes at Wat Pak Muang, Khua Mung , Amphoe Saraphi District, Chiang Mai 2. Co-Hosted Thot Kathin to Wat Nong Pling, Don Sa-Lab, Kouypra-Jao, Kanchanaburi 3. Co-Hosted Thot Kathin With MFC 4. Co-Hosted Thot Kathin to support building sermon hall in a monastery at Wat Santitham Banpot 5. Co-Hosted Thot Kathin to the ceremony a royal Kathin at Anti-Money Laundering Office (AMLO) 6. Co-Hosted Thot Kathin at Wat Siri Pha-nga-Tam Ni Mit, Bangkok Social Development 1. Support projects “"Rally court Relations 2015" for income support fund Cremation Court. 2. Support "Walk to honor King Chakri Chakri Sirindhorn " Walk to honor HRH Princess Sirindhorn HRH Prince's 60th Birthday Anniversary 5th. 3. Donate to Nepal Earthquake Relief 4. Support to Sporting vocation Games "Meng game". 5. Support to Foundation for Environmental Education for Sustainable Development (Thailand). 6. Donate school supplies, sports equipment and toys, playground equipment for students to poor schools Wilderness, Phitsanulok.

54 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

12. Internal Control and Risk Management 12.1 Opinion of the Board of Directors For the Company, the Audit Committee consists of three independent directors. Mrs. Patchanee Sinwattanacharoen acts as the secretary of the Audit Committee and makes a report on audit results and practices every month. In 2015, the Audit Committee held 11 meetings as shown in the Audit Committee report included in the 2015 annual report. In the Company Board meeting No.2/2016 on 29 February 2016 which the Audit Committee also attended, the Company Board evaluated the Company internal control by considering the information and reports and inquiring the management of the Company regarding the adequacy of its internal control system in five majors areas such as the organization and operating environment, risk management, management operational control, information and communication system, and monitoring system. After such evaluation, the Board of the Company was of the opinion that the Company had in place an appropriate and sufficient internal control system in the areas concerned. For other areas of the internal control system, the Board was also of the opinion that the Company had sufficiency of the internal control system. In addition, the Company’s current auditor on both quarterly and yearly basis reported that no important error was found regarding the internal control system. The Company has provided the audit and compliance division to audit and oversee the Company’s operations efficiently and as the center for supervising the Company’s operations in compliance with the laws, rules and regulations, notification, policy and regulations specified by the regulators. The audit and compliance division is required to make a report on audit results and practices to the Audit Committee every month before presenting to the Board of Directors of the Company, except that there is an urgent case to report the management and the Board to acknowledge it for immediate actions. The Company has appointed Mrs. Patchanee Sinwattanacharoen, Vice Managing Director of audit and compliance division, who is the head of audit and compliance division. Mrs. Patchanee Sinwattanacharoen has involved in audit and compliance functions in the securities business and financial institutions for more than 20 years and is a qualified person attending related training courses as specified by the SEC. Note: As the Securities Exchange Commissions (SEC) had visited and audited the operation processes of the securities company in 2014, and remarked some issues on the operation processes that were not fulfilled and completed as suggested by the SEC. The compliance department has been investigating and reporting accordingly on a monthly basis. Also, the compliance department also remarked some further issues and prepared the report, of related issues and the measures to correct such remarks, to submit to the SEC auditing committee. Hence, the this will ensure that the internal control processes of the company is complied with the SEC directions. According to the minutes of the Audit Committee meetings in the year 2015, the Audit Committee approved the report on the review of implementation of the issues/ observation above, proposed by the internal audit of the Company. The Audit Committee also instructed to monitor and review the practice of the employees continuously in order to comply with the rules and regulations of regulatory agencies and the Securities company’s regulations. 12.2 Head of audit and compliance division The internal audit and compliance division of the Comapny will audit and oversee various departments involved in the Company’s operations to comply with the laws and the Company’s policy. The audit and compliance division is required to make a report on audit results and practices to the Audit Committee and the Company’s executives. It is also an advisor of the Company regarding related rules and regulations. In the Audit Committee meeting No.12/2015 on 12 December 2015, the Audit Committee approved to appoint Mrs. Patchanee Sinwattanacharoen, the head of audit and compliance division with the opinion that he is qualified to perform such functions effectively. The appointment, removal and transfer the head of internal audit and compliance shall be approved by the Audit Committee, Currently, there are 7 people working under the Company’s internal audit and compliance division.

55 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

13. Related transactions Transaction Value (Baht) Connected Parties

2015 Mr. Sadawut Taechaubol Mr. Bee Taechaubol Mr. Ben Taechaubol

Mrs. Louise Diskul Na Ayudhya Mr. Tommy Taechaubol M.L. Santidis Diskul Pol.Lt. Gen. Werapong Chuenpagdee Mr. Kacha Chuenpagdee Ms. Pimporn Vanichsenee Mr. Kanchit Joonjiraporn

Necessity and Reasonableness of Transaction according to the Audit Committee’s opinion

Nature of Transaction 2016

Brokerage fees from securities

86,619.88

195,335.00

Deposit for customer’s account

14,123.14

13,994.11

Brokerage fees from securities

50.59

Deposit for customer’s account

8,549.64

8,464.54

Brokerage fees from securities

163,717.40

218,066.51

Deposit for customer’s account

555.68

550.60

Securities and Derivatives business receivables

8,563,802.57

Brokerage fees from securities

202,961.17

Deposit for customer’s account

38,267.99

37,917.71

Brokerage fees from securities

352,327.42

524,195.17

Deposit for customer’s account

68,677.84

13,458.92

Deposit for customer’s account

627.00

621.29

Deposit for customer’s account

347.84

344.64

Brokerage fees from securities

11,734.73

48,518.90

Deposit for customer’s account

124.12

122.88

Brokerage fees from securities

37,897.70

670.28

Deposit for customer’s account

713.98

Brokerage fees from securities

9,890.92

Deposit for customer’s account

1,689.35

284.87 -

56 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

The stated transaction is for securities business which is the ordinary operation of CGS, and pricing is in line with the market rate. Therefore, this transaction is necessary and reasonable.

Transaction Value (Baht) Connected Parties

Necessity and Reasonableness of Transaction according to the Audit Committeeâ&#x20AC;&#x2122;s opinion

Nature of Transaction 2015

2016

Ms. Benjamas Pangkum Ms. Aumpan Pangkum Mutual fund managed by associate

Brokerage fees from securities

4,464.06

Brokerage fees from securities

5,001.12

Brokerage fees from securities

9,354,235.74

45,121,016.58

338,735.49

407,736.07

Investment is one of the ordinary businesses for CGS.

Country Group Development Public Company Limited

Brokerage fees from securities

54,922.13

245,758.49

Deposit for customerâ&#x20AC;&#x2122;s account

10,185,045.33

10,076,528.63

The stated transaction is for securities business which is the ordinary operation of CGS, and pricing is in line with the market rate. Therefore, this transaction is necessary and reasonable.

EDP Enterprise Company Limited

Investment-net

Fees and services

5,000,000

The stated transaction is for securities business which is the ordinary operation of CGS, and pricing is in line with the market rate. Therefore, this transaction is necessary and reasonable.

Premises and equipment expenses

1,238,484.72

Warehouse rental expense is for ordinary operation of CGS and pricing is in line with the market rate. Therefore, this transaction is necessary and reasonable. Advertising expenses is for the ordinary operation of CGS and pricing is in line with the market rate. Therefore, this transaction is necessary and reasonable.

Sing Sian Yit Pao Company Limited

Other expenses

946,950.00

1,021,850.00

MFC Asset Management Public Company Limited

Brokerage fees from selling agent business

201,955.94

426,128.22

The stated transaction is for securities business which is the ordinary operation of CGS, and pricing is in line with the market rate. Therefore, this transaction is necessary and reasonable.

Fees and services

55,264.32

252,964.87

Fees from the investment advisory services, the ordinary business of CGS, are in line with the market rate. Therefore, this transaction is necessary and reasonable.

Fees and services

162,403.86

57 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

The fund paid one of the ordinary businesses for CGS.

Transaction Value (Baht) Connected Parties

Nature of Transaction 2015

Country Group Holdings Public Company Deposit for customerâ&#x20AC;&#x2122;s account Limited Brokerage fees from securities Securities and Derivatives business

2016

Necessity and Reasonableness of Transaction according to the Audit Committeeâ&#x20AC;&#x2122;s opinion

1,300,904.87

The stated transaction is for securities business which is the ordinary operation of CGS, and pricing is in line with the market rate. Therefore, this transaction is necessary and reasonable.

1,899,524.73

2,683,653.74

506,000.00

Fees are represented in the Tender Offer is for securities business which is the ordinary operation of CGS, and pricing is in line with the market rate. Therefore, this transaction is necessary and reasonable.

3,090,430.59

The stated transaction is for securities business which is the ordinary operation of CGS, and pricing is in line with the market rate. Therefore, this transaction is necessary and reasonable.

648,007,405.46

The dividend was approved by the Annual General Meeting of Shareholders for the year 2015 and the Board of Directors of the Company on July 28, 2015 .

receivables Fees and services

Profit from investments

Dividend

58 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

The Audit Committee Report The Audit Committee consists of three independent directors (1) Pol. Gen. Somchai Vanichsenee as the chairperson of the committee, (2) Mr. Dej Namsirikul, and (3) Mr. Charn Tulyaphistchai as an audit committee members. Mr. Dej Namsirikul and Mr. Charn Tulyaphistchai have adequate knowledge and experience to audit a reliability of Financial Statement and Mr. Priyong Teerasathian, Vice Managing Director of audit and compliance division, acts as the secretary of audit committee. In addition, the three audit committee members are not an advisor, executive committee or employees or staff of the Company and those have full qualifications as required by the SEC. The Audit Committee performed their duties independently as enacted by the Charter of Audit Committee and was coordinated by all related parties. The Audit Committee also gave the importance of internal control system, risk management and good corporate governance to ensure that the Company will provide good internal control and appropriate and acceptable risk management including accurate and reliable financial reports. In 2015, the Audit Committee held 11 meetings. The following are the scope of work of the Committee: 1) Reviewing the work performed by the audit and compliance division, approving the annual audit plan, audit reports, and follow-ups, as well as evaluating and making recommendations to improve the efficiency of the internal audit and compliance functions. 2) Reviewing the good corporate governance policy and encouraging the Company to have good corporate governance and management which can be audited, and disclosing adequate and transparent information to build confidence to investors, regulators and stakeholders, etc. The Audit Committee was of the opinion that the Company had adequate and appropriate good corporate governance and encouraged its stakeholders to join and achieve mutual benefits. 3) Jointly reviewing the appropriation of internal control system with the internal and external auditors and evaluating that the Company’s internal control and risk management were appropriate and sufficient to the changing situation. 4) Reviewing the Company’s operations to ensure compliance with the regulations of the SEC, SET, TFEX and other relevant laws of the Company’s business. 5) Reviewing and approving the quarterly and annual financial statements with internal and external auditors before presenting to the Board of Directors. The Committee agreed with the external auditors that the financial statements of the year 2015 were prepared in accordance with the Generally Accepted Accounting Standards by making recommendations without conditions and accurately and completely disclosing significant transactions in the notes accompanying the financial statements. 6) Proposing to the Board of Directors to appoint Mr.Chavala Theinprasertkit and/or Mr.Permsak Wongpatpagorn and /or Mr.Niti Jungnitnirundr and/or Ms. Nisagorn Songnamee of Deloitte Touche Tohmatsu Jaiyos Audit Co., Ltd. to act as the auditors of the Company for the year 2016. In addition, the Committee had considered the remuneration for the auditing service to be approved in the Shareholders’ Meeting. 7) Attending meetings, discussing and exchanging opinions with the management of the Company and the external auditors to acknowledge remarks and exchange ideas. 8) Consider the disclosure of connected transactions and conflict of interest. In 2015, the Audit Committee was of the opinion that the directors and management of the Company strictly observed good corporate governance in carrying out their duties, and that the Company had adequate and appropriate internal control system and risk management covering the management and staff levels for business operation. The Committee was also of the opinion that the management was determined to administer the organization under the prescribed code of ethics, oversee operations in compliance with the laws and regulations consistently, present the audit report of the audit and compliance division to the Audit Committee directly, and monitor corrective actions periodically to ensure that they comply with recommendations. In addition, Deloitte Touche Tohmatsu Jaiyos Audit Co., Ltd. The current auditor of the

59 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

Company, reported that no important error was found. The operations were performed according to the specified procedures with the efficient internal control system. In the Board meeting No.2/2016 on 29 February 2016, the Board considered sufficiency of the internal control system approved by the Audit Committee based on the information, reports and explanations given by the management in five major areas, i.e., the organization and operating environment, risk management, management operational control, information and communication system and monitoring system. The Board was of the opinion that the Company had in place an appropriate and sufficient internal control system in the areas concerned.

(Pol. Gen. Somchai Vanichsenee) Chairperson of the Audit Committee 29 February 2016

60 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

14. Financial Status and Performance Financial Statement 14.1 Auditor 2015 Mr. Chavala Tienpasertkij, CPA Number 4301 Deloitte Touche Tohmatsu Jaiyos Audit Co., Ltd. 14.2 Summary of Auditor opinion in the past three years 2015 Unqualified opinion 2014 Unqualified opinion with an emphasis of matters 2013 Unqualified opinion with an emphasis of matters

61 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

Key Financial Ratios Financial Statements in which Equity method is applied Key Financial Ratios 2015 Profitability Ratio Gross profit (%) Net profit (loss) (%) Return on equity (%) Return on investment (%) Efficiency Ratio Return on asset (%) Asset Turnover (times) Financial Ratio Liquid assets to borrowing (times) Earning assets to borrowing (times) Liquid assets to total asset ratio (%) Earning assets to total asset ratio (%) (%) Debts to equity (times) Dividend payout (%) Other Ratios Securities investment to total assets (%) Net capital ratio (NCR) (%) Per Share Net Profit (loss) ** (Baht) Dividends (Baht) Book Value (Baht) Growth Rate Total assets (%) Total liabilities (%) Securities business income (%) Operating expense (%) Net profit (loss) (%)

For the years ended December 31, 2014 2013 89.40 14.19 5.53 20.26

90.24 24.05 11.21 15.55

89.32 16.67 10.69 23.73

3.65 0.26

7.33 0.30

6.75 0.41

* * 42.99 65.11 0.36 313.88

* * 39.94 79.10 0.65 60.06

* * 37.70 67.55 0.41 82.62

26.07 216.39

29.43 88.00

17.34 242.05

0.069 0.238 1.162

0.149 0.092 1.35

0.138 0.11 1.30

(28.98) (52.39) (11.66) (9.10) (53.37)

21.26 65.59 (33.87) (29.32) 11.64

(13.11) (42.66) 27.06 19.92 32.42

* Not applicable as there were no borowings ** Weighted average method was utiilized

62 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

15. Management Discussion and Analysis The Company had the operating result in which the equity method is applied for the year ended December 31, 2015, which has net income of Baht 179.51 million, decreased by Baht 205.44 million or 53.37 % compared with a net income of Baht 384.95 million in the same period last year and recorded the retained earnings as at December 31, 2015 of Baht 291.46 million with the following details: Total revenues for the year ended December 31, 2015 of Baht 1,265.20 million, decreased by Baht 335.17 million or 20.94 % compared with Baht 1,600.37 million in the same period last year, with the following details: Securities Business Revenues Brokerage fees Fees and services income Gain on investments Gain on derivatives Interest and dividends Interest on margin loans Total securities business revenues Share of profit (loss) from investments for using equity method Profit from sales of investments in associated companies Other income Total revenues

FOR THE YEAR ENDED DECEMBER 31, 2015

2014

2013

868,499,176 61,142,783 113,945,907 3,590,620 56,722,593 46,334,794 1,150,235,873 (4,278,076)

68.64 4.83 9.01 0.29 4.49 3.66 90.92 (0.34)

1,024,704,552 61,716,999 99,042,759 3,162,726 68,289,745 45,069,986 1,301,986,767 60,406,932

64.03 3.86 6.19 0.20 4.27 2.81 81.36 3.77

1,695,680,086 39,588,808 66,150,446 19,723,499 90,959,489 56,604,590 1,968,706,918 86,424,302

81.96 1.91 3.20 0.95 4.40 2.74 95.16 4.18

103,777,239 15,469,848 1,265,204,884

8.20 1.22 100.00

237,975,720 1,600,369,419

14.87 100.00

13,707,904 2,068,839,124

0.66 100.00

1.Total securities business revenue was Baht 1,150.24 million decreased by Baht 151.75 million or 11.66 % compared with Baht 1,301.99 million in the same period last year. The decrease mostly resulted from: 1.1 Brokerage fees of Baht 868.50 million, decreased by Baht 156.20 million or 15.24 % compared with Baht 1,024.70 million in the same period last year, This resulted from a decrease in securities customerâ&#x20AC;&#x2122;s trading volume, in line with the decrease in SETâ&#x20AC;&#x2122;s trading volume and also the resignation of chief executive and marketing staff. 1.2 Fees and services income of Baht 61.14 million, decreased by Baht 0.58 million or 0.94 % compared with Baht 61.72 million in the same period last year mainly due to an decrease in income from brokerage fees and fees and services income decreased by Baht 17.61 million, Meanwhile, financial advisory fees increased by Baht 17.01 million. 1.3 Gain on investments and derivatives of Baht 117.54 million, increased by Baht 16.33 million or 15.00% compared with Baht 102.21 million in the same period last year. This was due to an increase in gain on sale of securities of Baht 31.80 million, and unrealized losses from the value of trading investments increased by Baht 17.01 million. 1.4 Interest and dividends income of Baht 56.72 million, decreased by Baht 11.57 million or 16.94 % compared with Baht 68.29 million in the same period last year. This mainly resulted from a decrease in interest income from money deposited in financial institutions of Baht 10.48 million due to lower average market interest rate.

63 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

2. Share of profit from investment for using equity method Baht 4.28 million decreased by Baht 64.69 million or 107.08 % compared with Baht 60.41 million in the same period last year. On March 5, 2015, the Company sold the above investment in MFC Asset Management Public Company Limited to Country Group Holdings PCL. The Company recognized share of profit from investments Baht 6.98 million compared with Baht 60.41 million in the same period last year. 3. Other income of Baht 15.47 million, decreased by Baht 222.51 million or 93.50 % compared with Baht 237.98 million in the same period last year mainly due to The company recorded a reversal of investment impairments in the associated company of Baht 205.59 million because the associated company’s fair value was higher than book value and the employer’s contribution and its benefit of provident fund members who were not entitled due to resignation of Chief Executive Officer and marketing staff. TOTAL EXPENSES for year ended 31 December 2015 , the Company had total expenses Baht 1,032.63 million, decreased by Baht 103.05 million or 9.07 % compared with Baht 1,135.68 million in the same period last year, which mainly resulted from Unit : Baht

Expenses Finance costs Fee and service expenses Operating expenses Personnel expenses Premises and equipment expenses Directors’ remuneration Other expenses Total Operating expenses Bad debt and doubtful accounts (reversal) Total expenses

FOR THE YEAR ENDED DECEMBER 31, 2015

2014

2013

20,378,835 101,544,648

1.61 8.03

21,075,886 105,938,478

1.31 6.62

53,583,831 156,610,947

2.59 7.57

637,443,127 150,211,144 10,805,000 115,753,319 914,212,590 (3,501,740) 1,032,634,333

50.38 11.87 0.86 9.15 72.26 (0.28) 81.62

690,507,227 170,039,332 11,365,000 133,877,698 1,005,789,257 2,874,350 1,135,677,971

43.15 10.63 0.71 8.36 62.85 0.18 70.96

1,072,167,248 194,926,006 11,145,000 144,756,121 1,422,994,375 15,931,601 1,649,120,754

51.82 9.42 0.54 7.00 68.78 0.77 79.71

1. Fee and service expenses of Baht 101.54 million, decreased by Baht 4.40 million or 4.15 % compared with Baht 105.94 million in the same period last year which varied in line with the decrease in securities and derivatives trading volume. 2. Operating expenses of Baht 914.21 million, decreased by Baht 91.58 million or 9.11 % compared with Baht 1,005.79 million in the same period last year due mainly to a decrease in personnel expenses which varied according to the decrease in securities and derivatives trading volume i.e. marketing incentives and profit sharing from branches/marketing team management, etc. Furthermore, the operating expenses decreased due to the decrease of branches and the resignation of chief executive and marketing staff which decrease the operating expenses i.e. salary, bonus and property, premises and equipment expenses etc. 3. Bad debt and doubtful accounts (reversal) was Baht 3.50 million. Mainly due to the company’s existing debtors’ collateral value has decreased.

SUMMARY OF NET PROFIT From the consolidated financial statement for year ended 31 December 2015, the Company had net profit of Baht 179.51 million (net profit Baht 0.069 per share) decreased by Baht 205.44 million or 53.37 % compare with the same period last year which was Baht 384.95 million (net profit Baht 0.149 per share). Furthermore, the Company s net profit ratio was 14.19 % which decreased from last year with net profit ratio of 24.05 % Total revenues for the year 2015 was decreased by Baht 355.17 million or 20.94 % whereas total expenses

64 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

was decreased by Baht 103.05 million or 9.07 %. As the result of net profit decreased, return on equity ratio was 5.53 % compared with the previous year which was 11.21 %. Asset Management Asset

Asset Cash and cash equivalents Deposits at financial institutions Receivables from Clearing House Securities and derivatives business receivables - net Investments - net Investments in associated companies - net Property, premises and equipment - net Intangible assets - net Deferred tax assets Other assets - net TOTAL ASSETS

AS AT DECEMBER 31, 2015

2014

2013

1,385,440,714 69,310,000 46,596,468

33.88 1.70 1.14

1,144,607,815 269,310,000 32,189,616

19.88 4.68 0.56

1,073,087,608 569,310,000 442,940,349

22.60 11.99 9.33

1,243,873,992 392,741,224 485,311,836 139,248,274 102,408,524 106,711,815 117,383,553 4,089,026,400

30.42 9.60 11.87 3.41 2.50 2.61 2.87 100.00

2,304,223,685 975,606,502 546,612,943 152,259,533 98,225,958 107,331,535 127,419,856 5,757,787,443

40.02 16.94 9.49 2.65 1.71 1.86 2.21 100.00

1,531,023,127 237,449,760 340,153,559 186,622,547 96,575,450 143,055,030 127,887,922 4,748,105,352

32.25 5.00 7.17 3.93 2.03 3.01 2.69 100.00

As of 31 December 2015, total assets of the Company were Baht 4,089.03 million, decreased by Baht 1,668.76 million or 28.98 % from last year which was Baht 5,757.79 million. The Company’s total asset consist of cash and cash equivalents were 33.88 % ,Deposits at financial institutions was 1.70 %, Net securities and derivatives business receivables were 30.42 %, Net investment was 9.60 %, Net investment in associated company was 11.87 %, Net property, premises and equipment were 5.91 %and the remaining of 6.62 %were Receivables from Clearing House, deferred tax assets, and other assets. The changes in assets can be summarized as follows: 1. Cash and cash equivalents and Deposits at financial institutions as of 31 December 2015 were Baht 1,454.75 million, increased by Baht 40.83 million or 2.89 % compared with Baht 1,413.92 million in the previous year. Most of Cash and cash equivalents and deposits at financial institutions were in form of cash, short-term deposits, fixed deposit and certificate of deposit, which convenience to utilize as working capital for daily operations. 2. Net securities and derivatives business receivable as of 31 December 2015 were 1,243.87 million, decreased by Baht 1,060.35 million or 46.02 %compared with Baht 2,304.22 million last year. Net securities and derivatives business receivable were decreased, mainly due to an decrease in receivable of Customers’ cash accounts was Baht 916.98 million. Net securities and derivatives business receivable had direct relationship with trading value of the last 3 days before the end of year. In relation to the Company’s policy on allowance for doubtful accounts, the Company has provided an allowance based on a review of debtor’s repayment capability, taking into consideration risk in recovery and value of collateral. Additionally, the Company has conservatively set the allowance for doubtful accounts based on a high of degree of uncertainty that principal and interest will be received and the doubtful debts are not fully covered by collateral. The allowance for doubtful accounts is classified by SEC’s notifications No. Gor Thor.33/2543 and Kor Thor. 5/2544 dated August 25, 2000 and February 15, 2001, respectively.

65 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

The details of the allowance for doubtful of the Companyâ&#x20AC;&#x2122;s subsidiary as at 31 December 2015 are as follows: Period of overdue

Cash accounts 1 - 3 months > 3 < = 6 months > 6 < = 12 months > 12 < = 24 months More than 24 months

Sub -Total Other receivables 1 - 3 months > 3 < = 6 months > 6 < = 12 months > 12 < = 24 months More than 24 months Sub-Total Total

Number

Debts Amount (Million Baht)

Collateral (Million Baht)

13.60

9 9 48

383.65 383.65 397.25

Net Debts (Million Baht)

Allowance for doubtful (Million Baht)

13.60

338.72 338.72 352.32

44.93 44.93 44.93

Result of collection

27 accounts are under follow up and 12 accounts are under litigations process

338.72 338.72 352.32

under litigations process

3. Net investment as at 31 December 2015 was Baht 392.74 million, increased by Baht 582.87 million or 59.74 % compared with Baht 975.61 last year. Net investment was decreased because the Company invested more in deb instrument of Baht 357.00 million and available for sale listed securities of Baht 225.32 million. The Company consisted of 84.47 %s ales of trading investments, 10.23 % of available for sale investment, and 5.30 %of general investment. Most of investments are in form of listed securities and unit trust that in need of the market. The Company has set up investment committee to monitor and establish guidelines for equity securities investment of the Company account. Also The Company has realized the allowance for diminution in value of investments and allowance for impairment according to accounting standard and announcement of SEC. Liabilities

Liabilities Payables to Clearing House Securities business payables Derivatives business payables Payables under finance leases Employee benefit obligations Other liabilities Total liabilities

AS AT DECEMBER 31, 2015

235,432,799 674,374,173 49,214,920 121,469,835 1,080,491,727

5.76 16.49 1.20 2.97 26.42

2014 187,679,778 1,846,213,834 3,110,971 44,045,050 188,342,967 2,269,392,600

3.26 32.06 0.05 0.77 3.27 39.41

2013 25,096,463 1,129,699,869 57,273 3,428,712 46,864,861 165,355,749 1,370,502,927

0.53 23.79 0.00 0.07 0.99 3.48 28.86

As at 31 December 2015, the Company had total liabilities of Baht 1,080.49 million, decreased by Baht 1,188.90 million or 52.39 % compared with the previous which was Baht 2,269.39 million. Total liabilities were decreased mainly due to an increase in securities business payable of Baht 1,171.84 million as the result of securities trading value during the last 3 days before the end of year.

66 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

Owner’s equity

AS AT DECEMBER 31,

Owner’s equity

2015

Issued and paid-up share capital Premium on share capital Other component of owners' equity Retained earnings Statutory reserve Unappropriated Total owners' equity

2014

2013

2,589,743,484 139,078,735 (11,743,679)

63.33 3.40 (0.28)

2,589,743,484 139,078,735 (5,170,661)

44.98 2.42 (0.09)

2,589,743,484 139,078,735 (8,940,060)

54.54 2.93 (0.18)

85,225,676 206,230,457 3,008,534,673

2.08 5.05 73.58

75,408,087 689,335,198 3,488,394,843

1.31 11.97 60.59

55,574,679 602,145,587 3,377,602,425

1.17 12.68 71.14

As at 31 December 2015, the owner’s equity of Baht 3,008.53 million, decreased by Baht 479.86 million or 13.76 % compared with the previous year which was Baht 3,488.39 million, mainly due to dividend payment in form of cash, amounted of Baht 652.55 Million. Moreover, the Company had an increase in retained earnings of Baht 179.51 million as at 31 December 2015. Liquidity and Sources of Funds of the Company and its subsidiary Sources of funds of the Company and its subsidiary are mainly from self-financed and credit line with commercial bank to support working capital of the Company and its subsidiary. The Company’s net liquid capital ratio (NCR) was 216.39 % as at 31 December 2015. This NCR is considered high compared to the minimum NCR required by the SEC at 7 %. Net liquid capital ratios (NCR) of the Company can be summarized as follows:

Country Group Securities PCL - Net liquid capital (Million Baht) - Liabilities and collateral (Million Baht) - Net liquid capital ratio (NCR)

As at December 31

2015

2014

2013

2,125.68 982.33 216.39%

1,918.86 2,180.57 88.00%

2,970.28 1,227.14 242.05%

Liquidity As of 31 December 2015, the Cash Flow Statement of the Company and its assocaited exhibited that net cash flow from operating activities was Baht 541.44 million as the result of an increase in receivables net from from cash received from the sale of trading investments, amounted baht 465.60 million. As of 31 December 2015, net cash flows used in investing activities was Baht 354.15 million, as a result of net cash received from investment and dividend from investment in securities, amounted Baht 241.58 million. Moreove net cash received from sale of investment in associate amounted Baht 648.91 million and cash outflow sales of investment in associated companies amounted Baht 496.39 million. Net cash flows used in financing activities was Baht 654.76 million as of 31 December 31 2015. Main transaction in financing activities was cash paid for dividend payment 2014, amounted of Baht 652.55 million. Overall, the Company has a strong financial status and high liquidity with NCR at 216.39 % (as of 31 December 2015) which was relatively high compare to 7 % NCR requirement setting by the SEC. Furthermore, the Company had cash and cash equivalent equal to Baht 1,385.44 million (33.88 %of total asset), a high liquid assets to total asset ratio equal to 42.99 % ,an income generating asset to total asset ratio equal to 65.11 and debts to equity ratio equal to 0.36. As of 31 December 2015, total shareholders’ equity was Baht 3,008.53 million and unallocated retained earnings were Baht 206.23 million. As a result, return on equity ratio increased from 5.33 % and return on investment increased was 20.26 %compared with the previous year which was 15.55 %.

67 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

Details of the Board of Directors, Management, Internal Audit and Compliance, and Corporate Secretary Name / Position Prof. Prayoon Chindapradist

Age (Year) 87

- Chairperson (Authorized Director)

Mr. Dej Namsirikul - Independent Director - Audit Committee Member

Education - Higher Diploma in Accountancy (Equivalent to Masterâ&#x20AC;&#x2122;s Degree), Thammasat University - Bachelor of Law/ Thammasat University Trainning - Director Accreditation Program - High School Diploma, Assumption Bangrak

Stakes (%)

Family Relationship

Work Experience in the past 5 years Period

Position

Company/Business

2006 - Present 2004 - Present 1993 - Present

Chairperson Chairperson of Audit Committee Chairperson of the University Activities Committee

Country Group Securities PCL. Asian Insulators Plc. Burapha University

2014 - present

Independent Director Good Governance committee Independent Director Audit Committee Member Vice Chairperson Chairperson Chairperson Advisor to the board

Country Group Holdings PCL

2006 - present

- Vice Chairperson 2010 - present 1994 - present 1987 - 2001

68 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

Country Group Securities PCL.

Union Pattaya Properties Co.,Ltd. Union Power Properties Co.,Ltd. Bangkok Bank Plc.

Name / Position General Wattana Sanphanich - Independent Director - Vice Chairperson

Pol. Gen. Somchai Vanichsenee - Independent Director - Chairperson of the Audit Committee

Age (Year) 77

Education - Higher Diploma in Public Law and Management, King Prajadhipokâ&#x20AC;&#x2122;s institute - Master of Political Science, Ramkhamhaeng University - Bachelor of Law Ramkhamhaeng University - National Defense College - Bachelor of Social Science, Chulachomklao Royal Military Academy Trainning - Director Accreditation Program 2004 - Corporate Governance For Capital Market Intermediaries 2015 - Master of Public Administration, Chulalongkorn University - Bachelor of Public Administration, Police Cadet Academy Trainning - Director Accreditation Program - Director Certification Program - Audit Committee Program - Finance for Non â&#x20AC;&#x201C; Finance Director

Stakes (%) -

Family Relationship

Work Experience in the past 5 years Period 2006 - Present 2006 - Present 2015 - Present 2014 - 2015 1991- 2006 2003 - 2005 2000 - 2006 2000 - 2006 2000 - 2006 1998 - 1999 1996 - 1999 1995 - 1996

2006 - present 2006 - present 2003 - 2005 2000 - 2002

69 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

Position

Company/Business

Independent Director and Vice Chairperson Vice Chairperson Member of National Reform Steering Assembly Member of National Council Reform Independent Director Vice Chairperson Senator (Karnchanaburi Province) Vice Chairman of Military Committee Vice Chairman of Committee for Independent Organizations Judge/ Military Supreme Court Inspector General Deputy supreme commander

Country Group Securities Plc. Phuket Fantasy Parliament Parliament Safari World Plc. Apex Securities Co., Ltd Senate Senate Senate

Independent Director and Chairperson of Audit Committee Independent Director Deputy Commissioner-General

Country Group Securities PCL.

Royal Thai Army Ministry of Defense The supreme Command Headquarter

Phuket Fantasy Apex Securities Co., Ltd. Royal Thai Police

Name / Position Mr. Charn Tulyaphisitchai - Independent Director - Audit Committee Member

Age (Year) 63

Education - High School Diploma, Assumption Sriracha and Saint Dominic School - Honorable Doctorate Degree, University of America

Stakes (%) -

Family Relationship

Work Experience in the past 5 years Period 2008 - present 2004 - present 2013 - present 2011 - present 1990 - 1995 1985 - 2007 1981 - 1985

70 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

Position Independent Director and Audit Committee Chairperson Chairperson Chairperson Chairperson Manager Manager

Company/Business Country Group Securities PCL CK Diamond Co., Ltd. Ratchada Torres Co., Ltd. Suanlum Night Bazaar Ratchadaphisek Co., Ltd. Capital Entertainment Co., Ltd. Rajah Palace Hotel Sinchaloen Investment Co., Ltd

Name / Position Mr. Sadawut Taechaubol - Director - Executive Chairperson (Authorized Director)

Age (Year) 63

Education - Honorable Degree (Business Administration), Kensington University, California, USA - Diploma (Commerce), Davis School, Brighton, UK - BA (Political Science), Ramkhamhaeng University Trainning - Director Accreditation Program - Capital Market Academy Class 12 - The executive power science curriculum Class 7

Stakes (%)

Family Relationship

Father of Mr. Tommy Taechaubol

Work Experience in the past 5 years Period 2015 - present 2013 - present 2009 - present 2007 - present 2006 - present 2012 - present 2009 - present 1987 - present 2010 - present 2010 - present 2010 - present 2006 - present 2006 - present

Position Director Chairperson Executive Director Director and Executive Chairperson Chief Executive Officer and President Chief Executive Officer and Acting President Director and Executive Chairperson Director and Executive Director Chairperson President Chairperson Vice Chairperson Director President Vice Chairperson Consultant to Minister of Commerce (Mr. Utai Pimjaichon) Consultant to Minister of Interior (General Chavalit Yongchaiyudh) Consultant to Minister of Finance (Mr.Chaiyos Sasomsub) Consultant to Minister of Interior (Mr. Kiatichai Chaichaowarat) Honorary Consultant to Minister of Prime Ministerâ&#x20AC;&#x2122;s office (Mr. Swat Khumprakob) Committee

71 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

Company/Business Padaeng Industry PCL Country Group Holdings PCL China Trade Promotion Association Country Group Securities PCL MFC Asset Management PCL Thai Chamber of Commerce and Industry Sing Sian Yit Pao., Ltd Country Group Development PCL Profit Venture Co., Ltd Taechaubol Farm Co., Ltd Bangkok Development Co., Ltd Country Group Co., Ltd Landmark Group Co., Ltd Public Warehouse Organization/ Ministry of Commerce Thai Commerce Association Ministry of Commerce Ministry of Interior Ministry of Finance Ministry of Interior Prime Ministerâ&#x20AC;&#x2122;s office AFET Committee

Name / Position Mr. Surabhon Kwunchaithunya - Director - Vice Executive Chairperson (Authorized Director)

Age (Year) 64

Education - MBA (Finance), University of Washington - BSIE, University of Washington, U.S.A., Scholarship Student - BSEE, University of Washington, U.S.A. Training - Director Accreditation Program - Director Certification Program - Role of the Chairman Program - Capital Market Academy Class 11 - Securitization, Fannie Mae of U.S.A. - Finance and Banking, HSBC, Hong Kong

Stakes (%) -

Family Relationship

Work Experience in the past 5 years Period 2014 - present

1997 - 2002

Vice Chairperson Chairperson of Nomination Committee and Compensation Committee Chairperson of Risk managent Committee Vice Chairperson of Investment Committee Director and Vice Executive Chairperson Director, Executive Director Chairperson of Nomination Committee And Good Governance Committee Independent Director and Chairperson of Audit Comittee Director Discipline subcommittee Chairperson of Risk Management Director Independent Director, Chairperson of Audit Committee Managing Director

2007- present 2000 - present 1999 - present

Director Chairman Chairman

2006 - present 2011 - present 2003 - present 2010 - 2012 2010 - 2012 2010 - 2012 2004 - 2010

Mr. Sim Hong Chye - Director

- High School Diploma, St. Joseph Institution, Singapore

Position

72 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

Company/Business Country Group Holdings PCL

Country Group Securities PCL MFC Asset Management PCL Tycoons Worldwide Group Plc. The Stock Exchange of Thailand The Stock Exchange of Thailand The Stock Exchange of Thailand Thailand Futures Exchange PCL (TFEX) Prinsiri PCL Secondary Mortgage Corporation (Government owned corporation/ Ministry of F inance) Country Group Securities PCL Penrose International Co., Ltd. Thai Real-Venture Co., Ltd.

Name / Position Mr. Somkad Sueptrakul - Director

Age (Year) 63

Education - MPA, Public Administration (Public Policy and Strategic Management), NIDA - Bachelor of Law, Ramkhamhaeng University - Advanced Certificate Course in Politics and Governance in Democratic Systems for Executives - Advanced Certificate Course in Administrative Justice for Executives , Administrative Court - Advanced Certificate Course in Urban management for Executives, Urban Green

Stakes (%) -

Family Relationship

Work Experience in the past 5 years Period 2014 - present

2008 - present 2009 - present 2013 - present 2010 - present 2002 - present

development Institute Training - Democratic Politics and Governance for High-Level Administrators, King Prajadhipokâ&#x20AC;&#x2122;s institute (Class 10) - Director Accreditation Program - Director Certification Program

73 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

Position Director Member of Nomination Committee and Compensation Committee Member of Risk Management Committee Chairperson of Investment Committee Director Chairperson of Investment Committee Vice Executive Chairperson Director and Audit Committee Legal Consultant

Company/Business Country Group Holdings PCL

Country Group Securities PCL Electronics Industry PCL Thai Rubber Latex Corporation (Thailand) PCL Areeya Properties PLC

Name / Position

Age (Year)

Pol. Lt. Gen Werapong Chuenpagdee

Education - GSPA, NIDA

Stakes (%) -

Chulalongkorn University

Period 2014 - present

2013 - present 2011 - 2013 2006 - 2011 2010 - present

- Bachelor of Public Administration, Royal Police Cadet Academy Training

- Independent Director

Work Experience in the past 5 years

- Master of Public Administration,

- Independent Director

Mr. Niphon Wisityuthasart

Family Relationship

- Director Accreditation Program - Director Certification Program - Audit Committee Program - Financial Statements for Directors - Role of the Compensation Committee - GSPA/NIDA - Bachelor of Law/ Thammasat University Training - Top Management Course/Capital Market Acade my Class 12 - Advanced Certificate Course in Public relation for Executives class 2 - Advanced Certificate Course in Urban development class for Executives class 3 - Certificate in Asian Disaster Preparedness Center (ADPC) - Director Accreditation Program

2009 - present Present Present -

2014 - Present

2011 - Present 2010 - Present

1999 - Present

74 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

Position

Company/Business

Independent Director Audit Committee Chairperson of Corporate Governance Committee Independent Director Director Consultant Independent Director and Chairperson of Audit Committee Independent Director and Audit Committee Director Director

Country Group Holdings PCL

Independent Director Chairperson of Audit Committee Member of the Nomination and Remuneration Committee Independent Director Independent Director, Chairperson of Audit Committee, and member of Nomination and Remuneration Committee Independent Director and Chairperson of Audit Committee

Country Group Holdings PCL

Country Group Securities PCL

Sing Sian Yit Pao Co.,Ltd Country Group development PCL Thai Hua Co., Ltd Fusin Mining Industry (Thailand) Co., Ltd.

Country Group Securities PCL Grand Canal Land PCL

Vanachai Group PLC

Name / Position Ms. Sudthida Chirapatsakul

Age (Year) 61

- Director - Executive Director - CEO (Manager)

Education

Stakes (%)

- Master degree, Krirk University - Bachelor degree, Kasetsart University Training - Director Accreditation Program

- Master of Business Administration (Honor) Sasin Graduate Institute of Business Administration , Chulalongkorn University - Bachelor of Law, University of New South Wales - Bachelor of Commerce Finance Major (Honor) Training - Director Accreditation Program - Real estate development Class 40 - Master of Business Administration for Executives, Ramkhamhaeng University - Master of Political Science, Ramkhamhaeng University - Bachelor of Finance, Dhurakij Pundit University Trainning - Director Accreditation Program - Director Certification Program - Corporate Covernance For Capital Market Intermediaries 2015

Family Relationship

- Director (Authorized Director))

Mr. Chanachai Joonjiraporn - Director - Executive Director - CEO

Period

Position

2013 - present

CEO (Manager) Executive Director Director Executive Managing Director Managing Director

Country Group Securities PCL

Country Group Holdings PCL

2012 - present 2014 - present 2015 - present 2010 - present

Director and CEO And Member of Investment Committee Director Advisor to the Executive Committee Director Executive Chairperson

2013 - present 2013 - present 2013 - 2013 2012 - present 2012 - present 2015 - present 2011 - 2012 2009 - 2011 2001 - 2009

Director CEO President Executive Director Managing Director/Retail Brokerage Director Executive Director Vice Managing Director, CEO Executive Director

Country Group Securities PCL

2010 - present 2013 - 2013 2009 - 2013

(Authorized Director) Mr.Tommy Taechaubol

Work Experience in the past 5 years

Son of Mr.Sadawut Taechaubol

2014 - present

75 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

Company/Business

Country Group Securities PCL MFC Asset Management PCL Padaeng Industry PCL Sing Sian Yit Pao., Ltd

ACAP Advisory PLC Finansia Syrus Securities PCL Globlex Securities Co., Ltd Seamico Securities PLC

Name / Position Mr. Chupong Tanasettakorn* Managing Director IB Division

Age (Year) 58

Education

Stakes (%)

Family Relationship

Work Experience in the past 5 years Period

Position

Company/Business

- MBA University of Detroit, USA - Bachelor of Science, Chulalongkorn University

2007 - 2015 2007 - 2007 2006 - 2007 1999 - 2000

Managing Director Managing Director Deputy Managing Director Director

Country Group Securities PCL KTB Securities Co., Ltd. Seamico Securities Plc. Philip Securities (Thailand) Plc.

- Bachelor of Economics, West Virginia University, U.S.A. - Master of Economics ,University of Central Missouri, U.S.A. Trainning - Director Accreditation Program - Audit Committee Program - BA in Accounting, Ramkhamhaeng University - Bachelor of Law, Thammasat University

2014 - present 2014 - present Present 2009 - 2013

Executive Director /Retail brokerage 4 Director Director CEO

Country Group Securities PCL MFC Asset Management PCL Government Saving Bank Globlex Securities Co., Ltd

2015 2013 â&#x20AC;&#x201C; 2015 2012 â&#x20AC;&#x201C; 2013 2006 - 2012

Managing Director Vice Managing Director Vice President Senior Vice President

Country Group Securities PCL

- M.S. in Accounting, Thammasat University - BA in Accounting, Thammasat University

2011 - present

Head and Vice Managing Director of Accounting and Finance Acting Head and Senior Vice President of Accounting and Finance Senior Vice President Vice President/ Account and Finance Assistant Vice President Vice President/ Strategy and Budget

Country Group Securities PCL

* Resigned from the company, effective 1 October 2015

Mr.Pitsanu Vichicholchai - Managing Director, Retail Brokerage 4 Division

Mr. Priyong Teerasathian** - Managing Director Internal Audit and Compliance

** Resigned from the company, effective 16 September 2015

Ms. Netchanok Anawan - Head and Vice Managing Director, Accounting and Finance Division

2010 - 2011 2010 - 2010 2007 - 2010 2006 - 2007

76 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

Classic Gold Co., Ltd KTB Securities (Thailand) Co., Ltd.

Name / Position Pitakphol Roongrojsuwan Secretary of the Company

Age (Year)

Education

Stakes (%)

- Bachelor of Law, Thammasat University

Family Relationship

Work Experience in the past 5 years Period 2015 - present 2014 - 2015 2011 - 2013

77 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

Position Secretary of the Company Assitant Secretary of the Company Legal Officer

Company/Business Country Group Securities PCL Buriram Sugar PCL The Bangkok Insurance PCL

Duties and Responsibilities of the Company’s Secretary 1. Advise the Board of directors on the Securities company’s laws, rules and regulations and ensure the directors will follow the company’s laws, rules and regulations. 2. Encourage the board of directors to have knowledge and understanding of corporate governance and follow practices. 3. Prepare agenda and notice of the shareholders and board of directors meetings. 4. Arrange the shareholders and board of directors meetings in compliance with the Securities company’s laws, rules and regulations and good practices. 5. Take minutes of the shareholders and board of directors meetings and ensure related parties will follow resolutions of the shareholders and board of directors meetings. 6. Prepare and maintain the board of directors’ registration, annual reports, notice of the shareholders and board of directors meetings, minutes of the shareholders and Board of Directors meetings. 7. Monitor the directors and management to make reports on their stakeholders including related person’s stakeholders as specified by the law. 8. Maintain the stakeholder reports reported by the directors or management as specified by laws. 9. Prepare the disclosure of related information and information reports to the regulations. 10. Coordinate with shareholders and the regulators. 11. Other duties assigned by the board of directors.

Details of the Board of Directors, Management and Internal Audit and Compliance of the Securities company Mr. Prayoon Chindapradist, Prof Mr. Dej Namsirikul General Wattana Sanphanich Pol. Gen. Somchai Vanichsenee Mr. Charn Tulyaphisitchai Mr. Sadawut Taechaubol Mr. Surabhon Kwunchaithunya Mr. Sim Hong Chye Mr. Somkad Sueptrakul Pol.Lt.Gen.Werapong Chuenpagdee Mr. Nipon Wisityuthasart Ms. Sudthida Chirapatsakul Mr. Tommy Taechaubol Mr. Pitinun Matitanaviroon Mr. Pisuth Viriyamettakul Mr. Chanachai Junjiraporn Mr. Chupong Tanasettakorn* Mr.Pitsanu Vichicholchai Mr. Priyong Teerasatian** Ms. Netchanok Anawan

The Securities company

The Company

X / / / / // // / / / / // / // /// /// /// ///

/ X / / / / // / / ///

* Resigned from the Company, effective 1 October 2015 ** Resignec from the Company, effective 16 September 2015 Remarks : X = Chairperson

78 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

/ = Director // = Executive Chairperson /// = Executiv

Detail of Head of Internal Audit and Head of the Company Detail

Name – Surname Position Age Education Training

Work Experience

Duration of Contract Responsibilities of Head of Compliance

Mrs. Patchanee Sinwattanacharoen Executive Vice President, Internal Audit and Compliance 44 Years Old Bachelor’s degree in Finance and Banking from Sukhothai Thammathirat Open University 1. The basic knowledge and technical to supervision for securities operations process (Compliance Officer). 2. Risk management and supervision of the securities business by Risk Based Approach (RBA) 3. The guideline for practice related to derivatives product. 4. Risk Management for Securities Business 5. The knowledge and technical to supervision for securities operations process – Middle class. 6. Adding Vale Using Risk Based Auditing 7. Introduction to Control Self-Assessment 8. Anti-Corruption : The Practical Guide (ACPG) 9. The knowledge of supervision practice (Compliance Training Program by ASCO) 2015 – Present : Executive Vice President – Internal Audit and Compliance / Country Group Securities Public Company Limited 2014 – 2015 : First Vice President – Compliance / UOB Kayhian (Thailand) Public Company Limited 2012 – 2014 : Vice Predident – Risk Management / KTB Securities (Thailand) Company Limited 2002 – 2012 : Vice President – Compliance and Internal Audit / Bualuang Securities Public Company Limited Indefinitely Responsibilities 1. Monitoring and supervision the operations of the Company to comply with the laws, rules and regulations that set by the related authorities. Develop the system to ensure the effectiveness of supervise and audit of company as requirements. 2. Training about regulations to Company’s officer. 3. Taking advise, commentdation about rules and regulations to directors, management and other departments in the company 4. Preparation the annual audit plan and evaluate the adequacy and effectiveness of internal control system of the company to Audit Committee and Board of Directors for approval. Perform the audit to achieve the audit plan. 5. Performing as a secretary of Audit Committee. 6. Supporting and coordinate with other departments upon request. 7. Strengthen and development the staff of Internal Audit and Compliance to have the knowledge to perform their jobs adequately and efficiently. 8. Other duties as assigned

79 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

REPORT OF THE INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS TO THE SHAREHOLDERS AND BOARD OF DIRECTORS COUNTRY GROUP SECURITIES PUBLIC COMPANY LIMITED We have audited the financial statements in which equity method is applied and the separate financial statements of Country Group Securities Public Company Limited, which comprise the statement of financial position in which equity method is applied and the separate statement of financial position as at December 31, 2015, and the related statements of comprehensive income, changes in owners’ equity and cash flows in which equity method is applied and the related separate statements of comprehensive income, changes in owners’ equity and cash flows for the year then ended, and notes, comprising a summary of significant accounting policies and other explanatory information. Management’s Responsibility for the Financial Statements Management is responsible for the preparation and fair presentation of these financial statements in accordance with Thai Financial Reporting Standards, and for such internal control as management determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. Auditor’s Responsibility Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with Thai Standards on Auditing. Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion. Opinion In our opinion, the aforementioned financial statements in which equity method is applied and the separate financial statements present fairly, in all material respects, the financial position of Country Group Securities Public Company Limited as at December 31, 2015, and financial performance and cash flows for the year then ended in accordance with Thai Financial Reporting Standards

BANGKOK February 25, 2016

Chavala Tienpasertkij Certified Public Accountant (Thailand) Registration No. 4301 DELOITTE TOUCHE TOHMATSU JAIYOS AUDIT CO., LTD.

80 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

COUNTRY GROUP SECURITIES PUBLIC COMPANY LIMITED STATEMENTS OF FINANCIAL POSITION AS AT DECEMBER 31, 2015 BAHT

Notes

FINANCIAL STATEMENTS

SEPARATE

IN WHICH

FINANCIAL STATEMENTS

EQUITY METHOD IS APPLIED

2015

2014

2015

2014

ASSETS

Cash and cash equivalents

1,385,440,714

1,144,607,815

1,385,440,714

1,144,607,815

Deposits at financial institutions

69,310,000

269,310,000

69,310,000

269,310,000

Receivables from Clearing House

46,596,468

32,189,616

46,596,468

32,189,616

1,243,873,992

2,304,223,685

1,243,873,992

2,304,223,685

Investments - net

392,741,224

975,606,502

392,741,224

975,606,502

Investments in associated companies - net

485,311,836

546,612,943

496,389,812

532,567,296

Property, premises and equipment - net

139,248,274

152,259,533

139,248,274

152,259,533

Intangible assets - net

102,408,524

98,225,958

102,408,524

98,225,958

Deferred tax assets

106,711,815

107,331,535

106,711,815

107,331,535

Other assets - net

117,383,553

127,419,856

117,383,553

127,419,856

4,089,026,400

5,757,787,443

4,100,104,376

5,743,741,796

Securities and derivatives business receivables - net

TOTAL ASSETS

Notes to the financial statements form an integral part of these financial statements

81 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

COUNTRY GROUP SECURITIES PUBLIC COMPANY LIMITED STATEMENTS OF FINANCIAL POSITION (CONTINUED) AS AT DECEMBER 31, 2015 BAHT

Notes

FINANCIAL STATEMENTS

SEPARATE

IN WHICH

FINANCIAL STATEMENTS

EQUITY METHOD IS APPLIED

2015

2014

2015

2014

LIABILITIES AND OWNERS’ EQUITY LIABILITIES

Payables to Clearing House Securities business payables

235,432,799

187,679,778

235,432,799

187,679,778

674,374,173

1,846,213,834

674,374,173

1,846,213,834

Payables under finance leases

3,110,971

Employee benefit obligations

49,214,920

44,045,050

49,214,920

44,045,050

Other liabilities

121,469,835

188,342,967

121,469,835

188,342,967

1,080,491,727

2,269,392,600

1,080,491,727

2,269,392,600

2,589,743,484

Total liabilities OWNERS’ EQUITY

Share capital

Authorized share capital 2,589,743,484 ordinary shares of Baht 1.00 Issued and paid-up share capital 2,589,743,484 ordinary 2,589,743,484

2,589,743,484

Premium on share capital

shares of Baht 1.00 20

139,078,735

Other component of owners' equity

10.3

(11,743,679)

(5,170,661)

(12,167,964)

(13,631,538)

85,225,676

75,408,087

85,225,676

75,408,087

206,230,457

689,335,198

217,732,718

683,750,428

3,008,534,673

3,488,394,843

3,019,612,649

3,474,349,196

4,089,026,400

5,757,787,443

4,100,104,376

5,743,741,796

Retained earnings Appropriated Statutory reserve Unappropriated Total owners' equity TOTAL LIABILITIES AND OWNERS’ EQUITY

Notes to the financial statements form an integral part of these financial statements

82 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

COUNTRY GROUP SECURITIES PUBLIC COMPANY LIMITED STATEMENTS OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME FOR THE YEAR ENDED DECEMBER 31, 2015 BAHT Notes

FINANCIAL STATEMENTS

SEPARATE

IN WHICH

FINANCIAL STATEMENTS

EQUITY METHOD IS APPLIED 2015

2014

2015

2014

REVENUES Brokerage fees

868,499,176

1,024,704,552

868,499,176

1,024,704,552

Fees and services income

61,142,783

61,716,999

61,142,783

61,716,999

Gain on investments

10.4

113,945,907

99,042,759

113,945,907

99,042,759

3,590,620

3,162,726

3,590,620

3,162,726

(4,278,076)

60,406,932

56,722,593

68,289,745

56,722,593

143,048,495

46,334,794

45,069,986

46,334,794

45,069,986

Gain on derivatives Share of profit (loss) from investments for using equity method Interest and dividends

10.5

Interest on margin loans

Profit from sales of investments in associated companies Other income

103,777,239 27

116,338,654

15,469,848

237,975,720

15,469,848

237,975,720

1,265,204,884

1,600,369,419

1,282,044,375

1,614,721,237

20,378,835

21,075,886

20,378,835

21,075,886

101,544,648

105,938,478

101,544,648

105,938,478

Personnel expenses

637,443,127

690,507,227

637,443,127

690,507,227

Premises and equipment expenses

150,211,144

170,039,332

150,211,144

170,039,332

Total revenues EXPENSES Finance costs Fee and service expenses Operating expenses

Directorsâ&#x20AC;&#x2122; remuneration

10,805,000

11,365,000

10,805,000

11,365,000

Other expenses

115,753,319

133,877,698

115,753,319

133,877,698

Bad debt and doubtful accounts (reversal) Total expenses INCOME BEFORE INCOME TAX INCOME TAX EXPENSES NET INCOME

(3,501,740)

2,874,350

(3,501,740)

2,874,350

1,032,634,333

1,135,677,971

1,032,634,333

1,135,677,971

232,570,551

464,691,448

249,410,042

479,043,266

(53,058,253)

(79,739,855)

(53,058,253)

(82,375,110)

179,512,298

384,951,593

196,351,789

396,668,156

83 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

COUNTRY GROUP SECURITIES PUBLIC COMPANY LIMITED STATEMENTS OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME FOR THE YEAR ENDED DECEMBER 31, 2015 BAHT Notes

FINANCIAL STATEMENTS

SEPARATE

IN WHICH

FINANCIAL STATEMENTS

EQUITY METHOD IS APPLIED 2015

2014

(309,425)

8,626,069

61,885

(1,725,214)

(247,540)

6,900,855

2015

2014

OTHER COMPREHENSIVE INCOME (LOSS) Items that will not be reclassified subsequently to profit or loss Actuarial gain (losses) on defined post-employment benefit plans

8,626,069

Income tax relating to items that will not be reclassified subsequently to profit or loss

(1,725,214)

6,900,855

Items that will be reclassified subsequently to profit or loss Gain (losses) on re-measuring available-for-sale investments

(7,739,668)

4,040,613

(3,810,469)

(14,985,908)

844,688

891,137

5,639,937

891,137

321,962

(1,162,351)

(365,894)

2,642,954

(6,573,018)

3,769,399

1,463,574

(11,451,817)

(6,820,558)

10,670,254

1,463,574

(4,550,962)

172,691,740

395,621,847

197,815,363

392,117,194

0.069

0.149

0.076

0.153

2,589,743,484

Adjustment surplus on re-measuring available-for-sale investments disposed during the periods Income tax relating to items that will be reclassified subsequently to profit or loss

Total other comprehensive income (loss) - net TOTAL COMPREHENSIVE INCOME

BASIC EARNINGS PER SHARE

Baht

WEIGHTED AVERAGE NUMBER OF ORDINARY SHARES

Notes to the financial statements form an integral part of these financial statements

84 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

COUNTRY GROUP SECURITIES PUBLIC COMPANY LIMITED STATEMENT OF CHANGES IN OWNERS' EQUITY FOR THE YEAR ENDED DECEMBER 31, 2015 BAHT

FINANCIAL STATEMENTS IN WHICH EQUITY METHOD IS APPLIED

Notes

Balance as at January 1, 2014 Change during the year Dividends paid Total comprehensive income (loss) Statutory reserve

Issued and

Premium

paid-up share capital

on share capital

2,589,743,484 23

Other reserves

139,078,735 -

Surplus (deficit) on re-measuring investments (8,940,060)

Retained earnings Appropriated Statutory reserve

Unappropriated

Total owners' equity

55,574,679

602,145,587

3,377,602,425

3,769,399 -

19,833,408

(284,829,429) 391,852,448 (19,833,408)

(284,829,429) 395,621,847 -

Balance as at December 31, 2014

2,589,743,484

139,078,735

(5,170,661)

75,408,087

689,335,198

3,488,394,843

Balance as at January 1, 2015 Change during the year Dividends paid Total comprehensive income (loss) Statutory reserve

2,589,743,484

139,078,735

(5,170,661)

75,408,087

689,335,198

3,488,394,843

(6,573,018) -

9,817,589

(652,551,910) 179,264,758 (9,817,589)

(652,551,910) 172,691,740 -

(11,743,679)

85,225,676

206,230,457

3,008,534,673

Balance as at December 31, 2015

2,589,743,484

139,078,735

Notes to the financial statements form an integral part of these financial statements

85 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

COUNTRY GROUP SECURITIES PUBLIC COMPANY LIMITED STATEMENT OF CHANGES IN OWNERS' EQUITY (CONTINUED) FOR THE YEAR ENDED DECEMBER 31, 2015 BAHT

SEPARATE FINANCIAL STATEMENTS

Notes Issued and paid-up share capital

Balance as at January 1, 2014 Change during the year Dividends paid Total comprehensive income (loss) Statutory reserve Balance as at December 31, 2014 Balance as at January 1, 2015 Change during the year Dividends paid Total comprehensive income (loss) Statutory reserve Balance as at December 31, 2015

Premium on share capital

Other reserves Surplus (deficit) on re-measuring investments

Retained earnings Appropriated Unappropriated Statutory reserve

Total owners' equity

2,589,743,484

139,078,735

(2,179,721)

55,574,679

584,844,254

3,367,061,431

2,589,743,484

139,078,735

(11,451,817) (13,631,538)

19,833,408 75,408,087

(284,829,429) 403,569,011 (19,833,408) 683,750,428

(284,829,429) 392,117,194 3,474,349,196

2,589,743,484

139,078,735

(13,631,538)

75,408,087

683,750,428

3,474,349,196

139,078,735

1,463,574 (12,167,964)

(652,551,910) 196,351,789 (9,817,589) 217,732,718

(652,551,910) 197,815,363 3,019,612,649

2,589,743,484

Notes to the financial statements form an integral part of these financial statements

86 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

9,817,589 85,225,676

COUNTRY GROUP SECURITIES PUBLIC COMPANY LIMITED STATEMENTS OF CASH FLOWS FOR THE YEAR ENDED DECEMBER 31, 2015 BAHT FINANCIAL STATEMENTS

SEPARATE

IN WHICH

FINANCIAL STATEMENTS

EQUITY METHOD IS APPLIED 2015

2014

2015

2014

232,570,551

464,691,448

249,410,042

479,043,266

49,728,319 (3,501,740)

57,724,619 2,874,350

49,728,319 (3,501,740)

57,724,619 2,874,350

6,354,405

(10,542,265)

6,354,405

(10,542,265)

(114,469,489)

25 (75,206,834)

(114,469,489)

25 (75,206,834)

(5,830,823)

(13,293,660)

(5,830,823)

(13,293,660)

CASH FLOWS FROM OPERATING ACTIVITIES Income before income tax Adjustments Depreciation and amortization Bad debt and doubtful accounts (reversal) Unrealized gain (loss) on re-measuring trading investments Unrealized loss on re-measuring derivatives liabilities Gain from trading in trading investments Gain from trading in available-for-sale investments Reverse impairment on investments in associated company Gain on disposal and written off premises, and equipment and intangible assets Share of (profit) loss from investments for using equity method Profit from sales of investments in associated companies Employee benefits expense Finance costs Interest and dividends income Cash received from interest Cash paid for interest Cash paid for income tax Income from operating activities before changes in operating assets and liabilities

(205,589,985)

(504,922)

(205,589,985)

(504,922)

(3,220,940)

4,278,076

(60,406,932)

(103,777,239) 14,318,300 20,378,835 (103,057,387) 91,476,497 (20,378,835) (87,881,029)

9,977,897 21,075,886 (113,359,731) 99,583,043 (21,075,886) (4,463,410)

(116,338,654) 14,318,300 20,378,835 (103,057,387) 91,476,497 (20,378,835) (87,881,029)

9,977,897 21,075,886 (188,118,481) 99,583,043 (21,075,886) (4,463,410)

(20,296,481)

148,767,625

(20,296,481)

148,767,625

200,000,000

300,000,000

200,000,000

300,000,000

(3,220,940) -

(Increase) decrease in operating assets Deposits at financial institutions Receivables from Clearing House

(14,406,852)

410,750,733

(14,406,852)

410,750,733

Securities and derivatives business receivables

1,063,851,433

(776,074,908)

1,063,851,433

(776,074,908)

Cash paid for purchases of trading investments

(87,738,507,001)

(83,256,941,378)

(87,738,507,001)

(83,256,941,378)

Cash received from sales of trading investments

88,204,103,113

82,654,660,573

88,204,103,113

82,654,660,573

Cash received from bill of exchange Other assets - net

80,000,000

11,624,140

(211,699)

11,624,140

(211,699)

47,753,021

162,583,315

47,753,021

162,583,315

(1,171,839,662)

716,513,965

(1,171,839,662)

716,513,965

Increase (decrease) in operating liabilities Payables to Clearing House Securities business payables Derivatives liabilities Employee benefit obligations Other liabilities

(57,298)

(9,148,430)

(4,171,639)

(9,148,430)

(4,171,639)

(31,689,162)

(15,483,885)

(31,689,162)

(15,483,885)

541,444,119

420,335,404

541,444,119

420,335,404

Net cash flows provided by operating activities

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COUNTRY GROUP SECURITIES PUBLIC COMPANY LIMITED STATEMENTS OF CASH FLOWS (CONTINUED) FOR THE YEAR ENDED DECEMBER 31, 2015 BAHT FINANCIAL STATEMENTS

SEPARATE

IN WHICH

FINANCIAL STATEMENTS

EQUITY METHOD IS APPLIED 2015

2014

2015

2014

CASH FLOWS FROM INVESTING ACTIVITIES Cash paid for purchases of available-for-sale investments

(119,986,840)

(207,737,627)

(119,986,840)

(207,737,627)

353,031,382

80,423,862

353,031,382

80,423,862

Cash received from sales of available-for-sale investments Cash paid for investments in subsidiary company

(9,850)

Cash paid for investments in associated companies

(496,389,812)

648,905,950

Cash received from sales of investments in associated companies Cash received from dividend of investments in securities

8,534,311

10,399,375

8,534,311

10,399,375

74,758,750

Cash received from dividend of investments in associated companies Cash paid for purchases of premises and equipment and intangible assets

(43,082,279)

(38,601,308)

(43,082,279)

(38,601,308)

3,140,318

17,262,878

3,140,318

17,262,878

354,153,030

(63,503,920)

354,153,030

(63,503,920)

(2,212,340)

(481,848)

(2,212,340)

(481,848)

(652,551,910)

(284,829,429)

(652,551,910)

(284,829,429)

(654,764,250)

(285,311,277)

(654,764,250)

(285,311,277)

Cash received from sales of premises and equipment and intangible assets Net cash flows provided by (used in) investing activities CASH FLOWS FROM FINANCING ACTIVITIES Cash paid for payables under finance leases Cash paid for dividend Net cash flows used in financing activities Net increase in cash and cash equivalents

240,832,899

71,520,207

240,832,899

71,520,207

Cash and cash equivalents as at January 1,

1,144,607,815

1,073,087,608

1,144,607,815

1,073,087,608

Cash and cash equivalents as at December 31,

1,385,440,714

1,144,607,815

1,385,440,714

1,144,607,815

Notes to the financial statements form an integral part of these financial statements

88 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

COUNTRY GROUP SECURITIES PUBLIC COMPANY LIMITED NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2015 1.

GENERAL INFORMATION Country Group Securities Public Company Limited, (“the Company”), is incorporated in Thailand and was listed on the Stock Exchange of Thailand (the “Stock Exchange”) in 1993. On January 8, 2015, the ordinary shares of the Company was delisted from the Stock Exchange, and the ordinary shares of Country Group Holdings were listed in place of the Company in accordance with the business restructuring plan. The Company converted the status to be a Public Limited Company in accordance with the Public Limited Companies Act on February 17, 1994. The head office is located at 132, Sindhorn Tower 1, 2nd Floor, Wireless Road, Lumpini, Pathumwan, Bangkok 10330. On April 29, 2014, The Annual General Shareholders’ Meeting for the year 2014 of the Company passed a resolution to approve the business restructuring plan of the Company. According to such restructuring plan, the Company established the company under the name Country Group Holdings Public Company Limited (“Country Group Holdings”), in order to engage in the business of investment and to hold the shares of the Company. Country Group Holdings made a tender offer for the securities of the Company with the exchange rate of 1 per 1. On December 25, 2014, Country Group Holdings reported that as a result of the tender offer, Country Group Holdings had acquired 99.1% of the total number of paid up shares and the Company is the subsidiary of Country Group Holdings. The parent company is Country Group Holdings Public Company Limited which is incorporated in Thailand, by holding 99.3% of the Company’s paid up share capital as at December 31, 2015. As at December 31, 2015 and 2014, the Company has 39 branches and 41 branches, respectively. On October 22, 2008, the Ministry of Finance had approved the securities business license type Kor No. Lor Kor-0002-01 and cancelled the old securities business licenses No. 51/2517 and No. 18/2547. The securities business license type Kor is the license that undertakes securities business in various categories consisting of 1. 2. 3. 4. 5. 6. 7. 8.

Securities Brokerage Securities Trading Securities Underwriting Investment Advisory Service Mutual Fund Management Private Fund Management Securities Borrowing and Lending Venture Capital Management.

The Office of the Securities and Exchange Commission has approved the Company to act as the financial advisory from March 21, 2012 to March 20, 2017.

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The Company was granted a license No. 0007/2551 on August 13, 2008 to undertake the derivatives agent from the Office of the Securities and Exchange Commission which has been effective since July 31, 2008. The Company was granted a license on July 12, 2010 to undertake the securities borrowing and lending business as the Principal from the Office of the Securities and Exchange Commission. The mutual fund management, the private fund management and the venture capital management shall be commenced only after the Company is granted the approval from the Office of the Securities and Exchange Commission. 2.

BASIS FOR PREPARATION AND PRESENTATION OF THE FINANCIAL STATEMENTS 2.1

The Company maintains its accounting records in Thai Baht and prepares its statutory financial statements in Thai language in conformity with Thai Financial Reporting Standards and practices generally accepted in Thailand and in accordance with the Notifications of the Office of the Securities and Exchange Commission. The presentation of the financial statements has been made in compliance with requirement of Thai Account Standard No. 1 (Revised 2014) “Presentation of Financial Statements”, and also the Notification of the Office of the Securities and Exchange Commission (“SEC”) No. SorTor/Kor/Nor. 53/2553, dated December 15, 2010, regarding “The Form of Financial Statements for Securities Companies”.

2.2

Thai Financial Reporting Standards affecting the presentation and/or disclosure in the current year financial statements The Federation of Accounting Professions has issued the Notifications regarding Thai Financial Reporting Standards (TFRSs) which are effective for the financial statements for the period beginning on or after January 1, 2015 onwards, as follow:

Thai Accounting Standards (“TAS”) TAS 1 (Revised 2014) Presentation of Financial Statements TAS 2 (Revised 2014) Inventories TAS 7 (Revised 2014) Statement of Cash Flows TAS 8 (Revised 2014) Accounting Policies, Changes in Accounting Estimates and Errors TAS 10 (Revised 2014) Events after the Reporting Period TAS 11 (Revised 2014) Construction Contracts TAS 12 (Revised 2014) Income Taxes TAS 16 (Revised 2014) Property, Plant and Equipment TAS 17 (Revised 2014) Leases TAS 18 (Revised 2014) Revenue TAS 19 (Revised 2014) Employee Benefits TAS 20 (Revised 2014) Accounting for Government Grants and Disclosure of Government Assistance TAS 21 (Revised 2014) The Effects of Changes in Foreign Exchange Rate TAS 23 (Revised 2014) Borrowing Costs TAS 24 (Revised 2014) Related Party Disclosures TAS 26 (Revised 2014) Accounting and Reporting by Retirement Benefit Plans

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Thai Accounting Standards (“TAS”) (Con’t) TAS 27 (Revised 2014) Separate Financial Statements TAS 28 (Revised 2014) Investments in Associates and Joint Ventures TAS 29 (Revised 2014) Financial Reporting in Hyperinflationary Economies TAS 33 (Revised 2014) Earnings per Share TAS 34 (Revised 2014) Interim Financial Reporting TAS 36 (Revised 2014) Impairment of Assets TAS 37 (Revised 2014) Provisions, Contingent Liabilities and Contingent Assets TAS 38 (Revised 2014) Intangible assets TAS 40 (Revised 2014) Investment Property Thai Financial Reporting Standards (“TFRS”) TFRS 2 (Revised 2014) Share - Based Payment TFRS 3 (Revised 2014) Business Combinations TFRS 5 (Revised 2014) Non-current Assets Held for Sale and Discontinued Operations TFRS 6 (Revised 2014) Exploration for and Evaluation of Mineral Assets TFRS 8 (Revised 2014) Operating Segments TFRS 10 Consolidated Financial Statements TFRS 11 Joint Arrangements TFRS 12 Disclosure of Interests in Other Entities TFRS 13 Fair Value Measurement Thai Accounting Standards Interpretations (“TSIC”) TSIC 10 (Revised 2014) Government Assistance - No Specific Relation to Operating Activities TSIC 15 (Revised 2014) Operating Leases - Incentives TSIC 25 (Revised 2014) Income Taxes - Change in the Tax Status of an Enterprise or its Shareholders TSIC 27 (Revised 2014) Evaluating the Substance of Transactions in the Legal Form of a Lease TSIC 29 (Revised 2014) Disclosure - Service Concession Arrangements TSIC 31 (Revised 2014) Revenue - Barter Transactions Involving Advertising Services TSIC 32 (Revised 2014) Intangible Assets - Web Site Costs Thai Financial Reporting Standard Interpretations (“TFRIC”) TFRIC 1 (Revised 2014) Changes in Existing Decommissioning, Restoration and Similar Liabilities TFRIC 4 (Revised 2014) Determining whether an Arrangement contains a Lease TFRIC 5 (Revised 2014) Rights to Interests arising from Decommissioning, Restoration and Environmental Rehabilitation Funds TFRIC 7 (Revised 2014) Applying the Restatement Approach under IAS 29 Financial Reporting in Hyperinflationary Economies TFRIC 10 (Revised 2014) Interim Financial Reporting and Impairment TFRIC 12 (Revised 2014) Service Concession Arrangements TFRIC 13 (Revised 2014) Customer Loyalty Programmes TFRIC 14 TAS 19 (Revised 2014) - The Limit on a Defined Benefit Asset, Minimum Funding Requirements and their Interaction TFRIC 15 (Revised 2014) Agreements for the Construction of Real Estate TFRIC 17 (Revised 2014) Distributions of Non-cash Assets to Owners TFRIC 18 (Revised 2014) Transfers of Assets from Customers TFRIC 20 Stripping Costs in the Production Phase of a Surface Mine Above TFRSs have no material impact on these financial statements, except for the followings:

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New Standard on Fair Value Measurement Impact of the application of TFRS 13 The Company has applied TFRS 13 for the first time in the current year. TFRS 13 establishes a single source of guidance for fair value measurements and disclosures about fair value measurements. TFRS 13 defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction in the principal (or most advantageous) market at the measurement date under current market conditions. Fair value under TFRS 13 is an exit price regardless of whether that price is directly observable or estimated using another valuation technique. Also, TFRS 13 includes extensive disclosure requirements. In addition, the Company has determined additional accounting policy for fair value measurement that presented in Note 3.24. TFRS 13 requires prospective application for the financial statements for the periods beginning on or after January 1, 2015 onwards. Other than the additional disclosures, the application of TFRS 13 has not had any material impact on the amounts recognised in the financial statements. In addition, the Federation of Accounting Professions issued the Notification regarding the Conceptual Framework for Financial Reporting (Revised 2015), which was announced in the Royal Gazette and effective from November 6, 2015 onwards to replace the Conceptual Framework for Financial Reporting (Revised 2014). Such Conceptual Framework for Financial Reporting has no material impact on these financial statements. 2.3

Thai Financial Reporting Standards announced in the Royal Gazette but not yet effective The Federation of Accounting Professions has issued the Notifications regarding Thai Financial Reporting Standards (TFRSs), which are effective for the accounting period beginning on or after January 1, 2016 onward as follows: Thai Accounting Standards (â&#x20AC;&#x153;TASâ&#x20AC;?) TAS 1 (Revised 2015) Presentation of Financial Statements TAS 2 (Revised 2015) Inventories TAS 7 (Revised 2015) Statement of Cash Flows TAS 8 (Revised 2015) Accounting Policies, Changes in Accounting Estimates and Errors TAS 10 (Revised 2015) Events after the Reporting Period TAS 11 (Revised 2015) Construction Contracts TAS 12 (Revised 2015) Income Taxes TAS 16 (Revised 2015) Property, Plant and Equipment TAS 17 (Revised 2015) Leases TAS 18 (Revised 2015) Revenue TAS 19 (Revised 2015) Employee Benefits TAS 20 (Revised 2015) Accounting for Government Grants and Disclosure of Government Assistance TAS 21 (Revised 2015) The Effects of Changes in Foreign Exchange Rate TAS 23 (Revised 2015) Borrowing Costs TAS 24 (Revised 2015) Related Party Disclosures TAS 26 (Revised 2015) Accounting and Reporting by Retirement Benefit Plans TAS 27 (Revised 2015) Separate Financial Statements

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Thai Accounting Standards (“TAS”) (Con’t) TAS 28 (Revised 2015) Investments in Associates and Joint Ventures TAS 29 (Revised 2015) Financial Reporting in Hyperinflationary Economies TAS 33 (Revised 2015) Earnings per Share TAS 34 (Revised 2015) Interim Financial Reporting TAS 36 (Revised 2015) Impairment of Assets TAS 37 (Revised 2015) Provisions, Contingent Liabilities and Contingent Assets TAS 38 (Revised 2015) Intangible Assets TAS 40 (Revised 2015) Investment Property TAS 41 Agriculture Thai Financial Reporting Standards (“TFRS”) TFRS 2 (Revised 2015) Share-based Payment TFRS 3 (Revised 2015) Business Combinations TFRS 4 (Revised 2015) Insurance Contracts TFRS 5 (Revised 2015) Non-current Assets Held for Sale and Discontinued Operations TFRS 6 (Revised 2015) Exploration for and Evaluation of Mineral Assets TFRS 8 (Revised 2015) Operating Segments TFRS 10 (Revised 2015) Consolidated Financial Statements TFRS 11 (Revised 2015) Joint Arrangements TFRS 12 (Revised 2015) Disclosure of Interests in Other Entities TFRS 13 (Revised 2015) Fair Value Measurement Thai Accounting Standards Interpretations (“TSIC”) TSIC 10 (Revised 2015) Government Assistance - No Specific Relation to Operating Activities TSIC 15 (Revised 2015) Operating Leases - Incentives TSIC 25 (Revised 2015) Income Taxes - Change in the Tax Status of an Enterprise or its Shareholders TSIC 27 (Revised 2015) Evaluating the Substance of Transactions in the Legal Form of a Lease TSIC 29 (Revised 2015) Disclosure - Service Concession Arrangements TSIC 31 (Revised 2015) Revenue - Barter Transactions Involving Advertising Services TSIC 32 (Revised 2015) Intangible Assets - Web Site Costs Thai Financial Reporting Standard Interpretations (“TFRIC”) TFRIC 1 (Revised 2015) Changes in Existing Decommissioning, Restoration and Similar Liabilities TFRIC 4 (Revised 2015) Determining whether an Arrangement contains a Lease TFRIC 5 (Revised 2015) Rights to Interests arising from Decommissioning, Restoration and Environmental Rehabilitation Funds TFRIC 7 (Revised 2015) Applying the Restatement Approach under IAS 29 (Revised 2015) Financial Reporting in Hyperinflationary Economies TFRIC 10 (Revised 2015) Interim Financial Reporting and Impairment TFRIC 12 (Revised 2015) Service Concession Arrangements TFRIC 13 (Revised 2015) Customer Loyalty Programmes TFRIC 14 (Revised 2015) TAS 19 (Revised 2015) - The Limit on a Defined Benefit Asset, Minimum Funding Requirements and their Interaction TFRIC 15 (Revised 2015) Agreements for the Construction of Real Estate TFRIC 17 (Revised 2015) Distributions of Non-cash Assets to Owners TFRIC 18 (Revised 2015) Transfers of Assets from Customers TFRIC 20 (Revised 2015) Stripping Costs in the Production Phase of a Surface Mine TFRIC 21 Levies Guideline on Accounting Guideline on Accounting regarding Recognition and Measurement of Bearded Plants The Company’s management anticipates that the Company will adopt the above Thai Financial Reporting Standards relevant to the Company in the preparation of financial statements of the Company when they become effective. The Company’s management has assessed the effects of these standards and believes that they will not have any significant impact on the financial statements for the period in which they are initially applied.

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2.4

The financial statements in which equity method is applied Share of profit (loss) from investment for using equity method expressed as a percentage of total revenues of the Company presented in the financial statements in which equity method is applied as follows: For the years ended December 31, 2015 2014 MFC Asset Management Public Company Limited - Share of profit from investment for using equity method (Baht) - Percentage of total revenues of the Company Padaeng Industry Public Company Limited - Share of loss from investment for using equity method (Baht) - Percentage of total revenues of the Company Country Group Development Public Company Limited - Share of loss from investment for using equity method (Baht) - Percentage of total revenues of the Company

6,982,200 0.6

60,406,932 3.8

(1,195,742) (0.1)

(10,064,534) (0.8)

On March 5, 2015, the Company sold the above investment in MFC Asset Management Public Company Limited to the parent company as a whole. The Company recognises profit from sales of such investment in the statement of profit or loss and other comprehensive income in which equity method is applied and the separate statement of profit or loss and other comprehensive income for the year ended December 31, 2015 amount of approximately Baht 103.8 million and approximately Baht 116.3 million, respectively. 3.

SIGNIFICANT ACCOUNTING POLICIES The financial statements have been prepared under the historical cost convention except as disclosed in the accounting policies. Significant accounting policies adopted by the Company are summarized below: 3.1

Revenue recognition Brokerage fees Brokerage fees from securities business and derivatives business are recognized as income on the transaction date. Fees and services income Fees income is recognized on an accrual basis and services income is recognized on the basis of percentage of completion, as specified in the service agreement.

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Gain (loss) on investments and derivatives Gain (loss) on investments and derivatives are recognized as income or expenses on trading date. Interest on margin loans Interest is recognized on an accrual basis, but where there is uncertainty as to the collectability of loans and interest, the Company stops using an accrual basis. In the following cases, collectability of loans and interest is held to be uncertain. 1) Loans which are not fully collateralized. 2) Installment loans with repayments scheduled less frequently than every 3 months and for which principal or interest is overdue by more than 3 months. 3) Installment loans with repayments scheduled over than every 3 months, unless there is clear evidence and a high degree of certainty that full repayment will be received. 4) Problem financial institution. 5) Other receivables from which interest payment is overdue for 3 months or more. These conditions are based on the guidelines stipulated by the Office of the Securities and Exchange Commission. Interest and dividend on investments Interest on investments is recognized as income on an accrual basis. Dividend on investments is recognized as income when the dividend is declared. 3.2

Expenses recognition Expenses are recognized on an accrual basis. Operating leases Lease in which substantially all the risks and rewards of ownership of assets remain with the lessor, payments made under operating leases are recognized in the statements of profit or loss and other comprehensive income on a straight - line basis over the term of the lease. Lease incentives received are recognized in the statements of profit or loss and other comprehensive income as an integral part of the total lease payments made. Contingent rentals are charged to the statements of profit or loss and other comprehensive income in the accounting period in which they are incurred.

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3.3

Recognition and amortization of customer deposits Money which customers have placed with the Company in cash accounts, cash balance and credit balance for securities trading and derivatives trading is recorded as the asset and liability of the Company. As at the statement of financial position date, the Company writes these amounts off from both assets and liabilities and presents only assets and liabilities which belong to the Company.

3.4

Cash and cash equivalents Cash and cash equivalents include cash on hand, current deposit accounts, saving deposit accounts, time deposit with maturities not later than 3 months from acquisition date, and without commitments, call notes receivables and term promissory notes with maturities within 3 months from acquisition date. This accords with the Notification issued by the Office of the Securities and Exchange Commission.

3.5

Deposits at financial institutions Deposits at financial institutions include fixed deposit accounts, promissory notes with maturities over 3 months from acquisition date, deposit used as collateral and certificate of deposit with maturities within 3 months from acquisition date which the Company intends to hold to roll over it.

3.6

Receivables and payables from/to Clearing House Net balances of receivable and payable incurred from settlement of securities and derivatives trading each day through Thailand Securities Depository Co., Ltd., and net balances of receivable and payable included from settlement of foreign securities trading each day through foreign securities companies, are presented as net balance receivables or payables from/to Clearing House in accordance with the Notification of the Office of the Securities and Exchange Commission No. SorTor/Kor/Nor. 53/2553 regarding â&#x20AC;&#x153;The Forms of Financial Statements for Securities Companiesâ&#x20AC;? dated December 15, 2010.

3.7

Securities and derivatives business receivables Securities and derivatives business receivables are the net balance after deducting allowance for doubtful accounts. Securities business receivables comprise 3 categories which are receivables from securities businesses of cash accounts, margin loans and other receivables. Receivables from securities businesses of cash accounts are the receivables that were derived from cash settlements within 3 working days for equity securities business receivables and agreed payment for debt securities business receivables, after the securities purchasing date. Margin loans are accounts that debtors are granted loans for securities purchasing with collaterals at the rate which is not lower than the rate required by the Stock Exchange of Thailand. Other receivables include overdue securities and derivatives receivables of cash accounts and securities and derivatives receivables which are the subject of legal proceedings, are undergoing restructuring or are settling in installments.

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The allowance for doubtful accounts is based on the assessment of the status of individual debtor and overall debtors as well as the requirements as stated in the Office of the Securities and Exchange Commissionâ&#x20AC;&#x2122;s Notifications No. KorThor. 33/2543 and KorThor. 5/2544 dated August 25, 2000 and February 15, 2001, respectively. Such assessment takes into consideration various factors including the risks involved and the value of collateral. Allowance is made for the estimated losses that might be incurred where the debts are not fully secured and/or there exists a possibility that principal and interest cannot be recovered in full. Such debt classifications and provisions are in accordance with guidelines by the Office of the Securities and Exchange Commission as follows: a) Assets classified as bad debt are to satisfy the following criteria: 1) Loans balances which the Company has already made every effort to collect, but which remain unpaid and which the Company has already written off in accordance with tax law. 2) Loans balances which the Company has forgiven. b) Doubtful debt is defined as the uncollateralized portion of the value of a debt which meets the following criteria: 1) General loans, problem financial institution loans, and other loans for which the collateral value is less than the loan balance. 2) Installment loans with repayments scheduled less frequently than every 3 months and for which principal or interest is overdue by more than 3 months. 3) Installment loans with repayments scheduled over than every 3 months, unless there is clear evidence and a high degree of certainty that full repayment will be received. c) Sub-standard debt is defined as the collateralized portion of loans which meet the criteria in b). Loans classified as bad debt will be written off when identified. Provision will be set aside for loans classified as doubtful at not less than 100% of the doubtful debt balance. 3.8

Investments Investments in marketable securities held for trading are stated at fair value, with any resultant gain or loss on re-measuring investments recognized in the statements of profit or loss and other comprehensive income . Investments in debt securities that the Company intends and is able to hold to maturity are stated at amortized cost less impairment losses. The difference between the acquisition cost and redemption value of such debt securities is amortized using the effective interest rate method over the period to maturity.

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Investments in debt securities and marketable equity securities other than those securities held for trading or intended to be held to maturity, are classified as being available-for-sale investments and are stated at fair value, with any resultant gain or loss on re-measuring investments being recognized as other component of owners’ equity in owners’ equity. The exception is impairment losses, which is recognized in the statements of profit or loss and other comprehensive income . When these investments are disposed, the cumulative gain or loss previously recognized directly in other component of owners’ equity in owners’ equity is recognized in the statements of profit or loss and other comprehensive income . Where these investments are interest-bearing, interest calculated using the effective interest method is recognized in the statements of profit or loss and other comprehensive income . Investments in equity securities which are not marketable are stated at cost, net allowance for impairment (if any). The fair value of marketable security is based on the latest bid price of the last working day of the year as quoted on the Stock Exchange of Thailand. The fair value of unit trusts of closed - end fund is determined from their net asset value. The fair value of debentures is calculated by using the latest bid yield as quoted by the Thai Bond Market Association. The weighted average method is used for computation of the cost of investments in equity securities. The first in - first out method is used for computation of the cost of investments in derivatives. Impairment Loss on impairment (if any) of investments is recognized in the statements of profit or loss and other comprehensive income when the carrying amount exceeds its recoverable value. 3.9

Investment in associated company Investment in associated company is accounted for in the financial statements in which equity method is applied using the equity method. Investment in associated company is accounted for in the separate financial statements using the cost method less allowance for impairment loss (if any). Any excess of the cost of acquisition over the carrying amount of the identifiable assets, liabilities and contingent liabilities of an associated company recognized at the date of acquisition is recognized as goodwill, which is included within the carrying amount of the investment. Loss on impairment (if any) of investment in associated company is recognized in the statements of profit or loss and other comprehensive income .

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3.10

Property, premises and equipment Property is stated at cost. Premises and equipment are stated at cost less accumulated depreciation and allowance for impairment (if any). Depreciation is charged to the statements of profit or loss and other comprehensive income on a straight-line basis over the estimated useful lives of each part of an item from the date that premises and equipment are available to use. The estimated useful lives are as follows: Premises Premises/leasehold improvement Furniture and office equipment Vehicles

20 5 3-5 5

years years years years

Leased assets Leases in terms of which the Company assumes substantial the risk and rewards of ownership other than legal title are classified as finance leases. Leased asset acquired by way of finance leases is capitalized at the lower of its fair value and the present value of the minimum lease payments at the inception of the lease, less accumulated depreciation and impairment losses (if any). Lease payments are apportioned between the finance charges and reduction of the lease liability. Finance charges are charged directly to the statements of profit or loss and other comprehensive income. Impairment Premises and equipment are tested for impairment when indicators of impairment are identified. Gain and loss on disposals are determined by comparing proceeds with carrying amount and are included in the statements of profit or loss and other comprehensive income. 3.11

Intangible assets Intangible assets with definite useful life are stated at cost less accumulated amortization and allowance for impairment (if any). Amortization is charged to the statements of profit or loss and other comprehensive income on a straight-line basis over the estimated useful lives of an item from the date that intangible assets with definite useful life are available for use. The estimated useful lives are as follows: Using derivatives business fee Computer software

1 - 5 years 5 years

Intangible assets with indefinite useful life are tested for impairment when indicators of impairment are identified,

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and allowance for impairment is recognized (if any). 3.12

Assets classified as held for sale Assets are classified as assets held for sale if their carrying amount will be recovered principally through a sale transaction rather than through continuing use, the Companyâ&#x20AC;&#x2122;s management anticipates the sale is highly probable and the assets are available for immediate sale in its present condition. Assets held for sale consist of immovable properties which is stated at the lower of cost amount or fair value after deducting costs of sales.

3.13

Leasehold right Leasehold right is stated at cost less accumulated amortization and allowance for impairment (if any). Amortization is charged to the statements of profit or loss and other comprehensive income on a straight-line basis over the period of the lease term.

3.14

Investment property Investment property is stated at cost less accumulated depreciation and allowance for impairment (if any).

3.15

Securities business payables Securities business payables are the obligations of the Company in respect of its securities and derivatives businesses with outside parties.

3.16

Derivatives liabilities Derivative warrants are recorded as liabilities items and the changes in fair value are recorded in the statements of profit or loss and other comprehensive income. The fair value of derivative warrants is based on the latest offer price of the last working day of the year as quoted on the Stock Exchange of Thailand.

3.17

Borrowings Borrowings are recognized initially at fair value of proceeds received. Borrowings are subsequently stated at amortized cost using the effective yield method; any difference between proceeds and the redemption value is recognized in the statements of profit or loss and other comprehensive income over the period of borrowings.

3.18

Provision for liabilities The Company recognizes provision as liabilities in the financial statements when the amount of the liability can be reliably estimated and as commitments when it is likely that loss of resources which are of economic benefit to the Company will result from settlement of such commitments.

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3.19

Financial instruments Financial instruments carried in the statement of financial position include cash and cash equivalents, deposits at financial institutions, receivables from Clearing House, securities and derivatives business receivables, net investments, payables to Clearing House, securities business payables, derivatives liabilities and payables under finance lease. The particular recognition methods adopted are disclosed in the individual policy statements associated with each item.

3.20

Employee benefits 3.20.1

Provident fund The contribution for employee provident fund is recorded as expense when incurred.

3.20.2

Employee benefit obligations The Company calculated the post-employment benefits obligation under the Thai Labor Protection Act based on actuarial assumptions at the end of reporting period using Projected Unit Credit Method, which is estimated based on the present value of expected cash flows of benefits to be paid in the future taken into account the actuarial assumptions, including salaries, turnover rate, mortality rate, years of service and other factors. Discount rate which calculates the post-employment benefit obligation based on yield rate of government bond. The expenses for the defined post-employment benefits plan are recognized as personnel expenses in the statements of profit or loss and other comprehensive income. Actuarial gains on defined post-employment benefits are recognized in other comprehensive income (loss).

3.21

Income tax Income tax expense represents the sum of corporate income tax currently payable and deferred tax. Current tax Current income tax is provided in the accounts at the amount expected to be paid to the taxation authorities, based on taxable profits determined in accordance with tax legislation.

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Deferred tax Deferred income tax is provided on temporary differences between the tax bases of assets and liabilities and their carrying amounts at the end of each reporting period, using the tax rates enacted at the end of the reporting period. The Company recognizes deferred tax liabilities for all taxable temporary differences while they recognize deferred tax assets for all deductible temporary differences and tax losses carried forward to the extent that it is probable that future taxable profit will be available against which such deductible temporary differences and tax losses carried forward can be utilized. At each reporting date, the Company reviews and reduces the carrying amount of deferred tax assets to the extent that it is no longer probable that sufficient taxable profit will be available to allow all or part of the deferred tax asset to be utilized. The Company records deferred tax directly to owners' equity if the tax relates to items that are recorded directly to owners' equity. 3.22

Basic earnings per share Basic earnings per share is determined by dividing net income for the year by the weighted average number of ordinary shares held by outside parties outstanding during the year.

3.23

Foreign currency transactions Transactions during the year denominated in foreign currencies are translated into Baht at rates of exchange on transaction dates. Monetary assets and liabilities in foreign currencies at the date of the financial statements are converted at the reference exchange rates established by the Bank of Thailand at that date. Gains or losses on exchange arising on translation and settlement is recognized as income or expense in the statements of profit or loss and other comprehensive income.

3.24

Fair value measurements Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date, regardless of whether that price is directly observable or estimated using another valuation technique. In estimating the fair value of an asset or a liability, the Company takes into account the characteristics of the asset or liability if market participants would take those characteristics into account when pricing the asset or liability at the measurement date. In addition, fair value measurements are categorized into Level 1, 2 or 3 based on the degree to which the inputs to the fair value measurements are observable and the significance of the inputs to the fair value measurement in its entirely, which are described as follows:

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3.25

Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities that the entity can access at the measurement date.

Level 2 inputs are inputs, other than quoted prices included within Level 1, which are observable for the asset or liability, either directly or indirectly.

Level 3 inputs are unobservable inputs for the asset or liability.

Use of accounting estimates The preparation of financial statements in conformity with generally accepted accounting principles also requires the Company’s management to exercise judgments in order to determine the accounting policies, estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expense during the reporting year. Although these estimates are based on management’s reasonable consideration of current events, actual results may differ from these estimates. Accounting estimates are as follows: Fair value measurements and valuation processes Some of the Company’s assets and liabilities are measured at fair value for financial reporting purposes. The Company’s management has to determine the appropriate valuation techniques and inputs for fair value measurements. In estimating the fair value of an asset or liability, the Company uses market-observable data to the extent it is available. Where Level 1 inputs are not available, the Company engages third party qualified valuers to perform the valuation. The Company’s management works closely with the qualified external valuers to establish the appropriate valuation techniques and inputs to the model and reports the valuation committee’s findings to the board of directors of the Company every quarter to explain cause of fluctuations in the fair value of the assets and liabilities. Information about valuation techniques and inputs used in determining the fair value of various assets and liabilities are disclosed in Note 36.6.

103 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

SUPPLEMENTARY DISCLOSURES OF CASH FLOW INFORMATION Non-cash items are as follows: 4.1

Finance lease agreements for vehicles are as follows: BAHT FINANCIAL STATEMENTS IN WHICH EQUITY METHOD IS APPLIED AND SEPERATE FINANCIAL STATEMENTS As at December 31, 2015 2014 Finance lease payables brought forward (Less) Lease termination (Less) Cash payments Add Interest expense Finance lease payables carried forward

4.2

3,110,971 (1,006,000) (2,212,340) 107,369 -

3,428,712 (481,848) 164,107 3,110,971

During the years ended December 31, 2015 and 2014, the Company recognized gain (loss) on re-measuring available-for-sale investments and adjustment surplus on re-measuring available-for-sale investments disposed during the years, net of tax, which were presented as addition (deduction) from other component of owners’ in the financial statements in which equity method is applied amounting to approximately Baht (6.6) million and approximately Baht 3.8 million, respectively, and the separate financial statements amounting to approximately Baht 1.5 million and approximately Baht (11.5) million, respectively.

CASH AND CASH EQUIVALENTS

Cash, short-term deposits and promissory notes with maturities not later than 3 months from acquisition date (Less) Deposits for customers’ account* Total

FINANCIAL STATEMENTS IN WHICH EQUITY METHOD IS APPLIED AND SEPERATE FINANCIAL STATEMENTS As at December 31, 2015 2014 BAHT BAHT 1,845,468,329 (460,027,615) 1,385,440,714

1,631,237,837 (486,630,022) 1,144,607,815

(* Deposit accounts for the customers are not shown as assets and liabilities in the financial statements according to the Notification of the Office of the Securities and Exchange Commission.)

104 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

DEPOSITS AT FINANCIAL INSTITUTIONS 6.1

As at December 31, 2015 and 2014, the Company has deposits at financial institutions as follow: FINANCIAL STATEMENTS IN WHICH EQUITY METHOD IS APPLIED AND SEPARATE FINANCIAL STATEMENTS As at December 31, 2015 As at December 31, 2014 Not later Later than Total Not later Later than than 3 3 months but than 3 months but months not later than 3 months not later than 1 year 1 year Baht Baht Baht Baht Baht Fixed deposits Deposits with restriction (Less) Deposits in customersâ&#x20AC;&#x2122; account* Total

Total

Baht

1,000,001,016 -

69,310,000

1,000,001,016 69,310,000

950,001,006 -

600,000,000 69,310,000

1,550,001,006 69,310,000

(1,000,001,016) -

69,310,000

(1,000,001,016) 69,310,000

(750,001,006) 200,000,000

(600,000,000) 69,310,000

(1,350,001,006) 269,310,000

(* Deposit accounts for the customers are not shown as assets and liabilities in the financial statements according to the Notification of the Office of the Securities and Exchange Commission.) 6.2

As at December 31, 2015 and 2014, deposits at financial institutions of the Company have been pledged as collateral to banks as follows: FINANCIAL STATEMENTS IN WHICH EQUITY METHOD IS APPLIED AND SEPARATE FINANCIAL STATEMENTS As at December 31, 2015 2014 BAHT BAHT Bank guarantee Pledged as collateral for over-draft credit limit and borrowing Others Total

15,070,000

54,000,000 240,000 69,310,000

RECEIVABLES FROM CLEARING HOUSE FINANCIAL STATEMENTS IN WHICH EQUITY METHOD IS APPLIED AND SEPARATE FINANCIAL STATEMENTS As at December 31, 2015 2014 BAHT BAHT Receivables from clearing house Receivables from foreign securities companies (Less) Receivables from Clearing House for the customers* Total

73,646,775 45,473,106 (72,523,413) 46,596,468

77,142,883 188,898,457 (233,851,724) 32,189,616

(* Receivables from Clearing House accounts for the customers are not shown as assets and liabilities in the financial statements according to the Notification of the Office of the Securities and Exchange Commission.)

105 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

SECURITIES AND DERIVATIVES BUSINESS RECEIVABLES - NET FINANCIAL STATEMENTS IN WHICH EQUITY METHOD IS APPLIED AND SEPARATE FINANCIAL STATEMENTS As at December 31, 2015 2014 BAHT BAHT Securities business receivables Customers’ cash accounts Margin loans Other receivables - Receivables under litigation - Past due and other receivables Total securities business receivables (Less) Allowance for doubtful accounts (see Note 9) Total Derivatives business receivables Other receivables - Past due and other receivables Total derivatives business receivables (Less) Allowance for doubtful accounts (see Note 9) Total

712,260,340 486,684,931

1,628,510,098 633,556,638

396,739,119 513,182 1,596,197,572 (352,323,580) 1,243,873,992

396,739,119 513,182 2,659,319,037 (355,095,352) 2,304,223,685

1,243,873,992

729,968 729,968 (729,968) 2,304,223,685

Customers’ cash accounts are classified as normal receivables. As at December 31, 2015 and 2014, the Company has ceased to recognize the interest income from securities and derivatives business receivables amounting to approximately Baht 397.3 million and approximately Baht 398.0 million, respectively, for financial statements in which equity method is applied and the separate financial statements of which the allowance for doubtful accounts was fully set up for doubtful status in accordance with the Notification of the Office of the Securities and Exchange Commission No. Kor Thor. 33/2543, regarding “The accounting preparation for sub-standard receivables of securities companies” dated August 25, 2000, which is updated by the Notification No. Kor Thor. 5/2544 dated February 15, 2001. The Company has classified securities and derivatives business receivables including related accrued interest receivables according with the Notification of the Office of the Securities and Exchange Commission regarding “The accounting preparation for sub-standard receivables of securities company”. Securities business receivables are classified as follows:

Normal debts Substandard debts Doubtful of loss debts Total

Unit : Million Baht FINANCIAL STATEMENTS IN WHICH EQUITY METHOD IS APPLIED AND SEPARATE FINANCIAL STATEMENTS As at December 31, 2015 As at December 31, 2014 Securities Allowance Securities Securities Allowance Securities and derivatives for doubtful and derivatives and derivatives for doubtful and derivatives business accounts business business accounts business receivables and receivables - net receivables and receivables - net accrued interest accrued interest receivables receivables 1,198.9 1,198.9 2,262.1 2,262.1 45.0 45.0 42.1 42.1 352.3 1,596.2

(352.3) (352.3)

1,243.9

106 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

355.8 2,660.0

(355.8) (355.8)

2,304.2

ALLOWANCE FOR DOUBTFUL ACCOUNTS FINANCIAL STATEMENTS IN WHICH EQUITY METHOD IS APPLIED AND SEPARATE FINANCIAL STATEMENTS As at December 31, 2015 2014 BAHT BAHT Balance at beginning of the years Add (Less) Allowance for doubtful accounts (reversal) Balance at end of the years (see Note 8)

10.

355,825,320 (3,501,740) 352,323,580

352,950,970 2,874,350 355,825,320

INVESTMENTS - NET 10.1 Cost and fair value

Trading investments Equity securities: Listed securities (Less) Allowance for revaluation Total equity securities - net Debt instruments: Bond (Add) Allowance for revaluation Total debt instruments - net Total trading investments - net Debt instruments with held-to-maturity Bill of exchange (Less) Allowance for loss on impairment Total debts instruments with held-to-maturity - net

FINANCIAL STATEMENTS IN WHICH EQUITY METHOD IS APPLIED AND SEPARATE FINANCIAL STATEMENTS As at December 31, 2015 As at December 31, 2014 Cost/ Fair value Cost/ Fair value Amortized cost/ Amortized cost/ Carrying amount Carrying amount Baht Baht Baht Baht

5,567,875

5,567,875 5,567,875

6,107,667 (56,667) 6,051,000

6,051,000 6,051,000

321,967,019 4,186,980 326,153,999 331,721,874

326,153,999 326,153,999 331,721,874

672,553,850 10,598,053 683,151,903 689,202,903

683,151,903 683,151,903 689,202,903

139,000,000 (139,000,000)

5,567,875

Available-for-sale investments Equity securities: Unit trusts Listed securities (Less) Allowance for revaluation Total available-for-sale investments - net

1,500,000 53,668,421 (14,986,407) 40,182,014

1,217,514 38,964,500 40,182,014

101,500,000 180,819,549 (16,822,286) 265,497,263

97,304,323 168,192,940 265,497,263

General investments Unit trusts Equity securities (Less) Allowance for revolution Allowance for loss on impairment Total general investments - net Total

562,282 47,328,364 (223,546) (26,829,764) 20,837,336 392,741,224

338,735 20,890,817 21,229,552 393,133,440

624,873 47,328,364 (217,137) (26,829,764) 20,906,336 975,606,502

407,736 23,417,609 23,825,345 978,525,511

The above investments excluded customer’s securities which are deposited with the Company for customers’ securities brokerage purpose.

107 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

10.2

Investments in debt instruments by remaining period As at December 31, 2015 and 2014, the Company has investment in debt instrument amounting to Baht 139.0 million which the Company has fully provided allowance for loss on impairment.

10.3

Unrealized gain (loss) on re-measuring available-for-sale investments recognized in other component of ownersâ&#x20AC;&#x2122; equity in ownersâ&#x20AC;&#x2122; equity FINANCIAL STATEMENTS IN WHICH EQUITY METHOD IS APPLIED As at December 31, 2015 2014 Baht Baht Balance at beginning of the year Change in the years - From re-measuring of investments - Adjustments relating to the disposal of surplus on re-measuring investments* - Income tax relating to components of other comprehensive income (loss) Balance at end of the years

10.4

SEPARATE FINANCIAL STATEMENTS As at December 31, 2015 2014 Baht Baht

(5,170,661)

(8,940,060)

(13,631,538)

(2,179,721)

(7,739,668)

4,040,613

(3,810,469)

(14,985,908)

844,688

891,137

5,639,937

891,137

321,962 (11,743,679)

(1,162,351) (5,170,661)

(365,894) (12,167,964)

2,642,954 (13,631,538)

The above transactions were previously recognized gain (loss) from re-measuring of investments in other comprehensive income in the prior years. Such investments were sold and recognized as gain or loss on investments in the statements of profit or loss and other comprehensive income for the year ended December 31, 2015 and 2014.)

Gain on investments FINANCIAL STATEMENTS IN WHICH EQUITY METHOD IS APPLIED AND SEPARATE FINANCIAL STATEMENTS As at December 31, 2015 2014 BAHT BAHT Unrealized gain (loss) on re-measuring trading investments Gain on sale of trading investments Gain on sale of available-for-sale investments Total

108 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

(6,354,405) 114,469,489 5,830,823 113,945,907

10,542,265 75,206,834 13,293,660 99,042,759

10.5

Interest and dividends FINANCIAL STATEMENTS IN WHICH EQUITY METHOD IS APPLIED For the years ended December 31, 2015 2014 Baht Baht Interest income Dividends Total

10.6

48,188,282 8,534,311 56,722,593

SEPARATE FINANCIAL STATEMENTS For the year ended December 31, 2015 2014 Baht Baht

57,890,370 10,399,375 68,289,745

48,188,282 8,534,311 56,722,593

57,890,370 85,158,125 143,048,495

As at December 31, 2015 and 2014, the Company has investments in companies that have financial position and performance problems as follows: FINANCIAL STATEMENTS IN WHICH EQUITY METHOD IS APPLIED AND SEPARATE FINANCIAL STATEMENTS As at December 31, 2015 As at December 31, 2014 Cost/ Carrying Fair Value Allowance for loss Cost/ Carrying Fair Value Allowance for loss amount on impairment amount on impairment Baht Baht Baht Baht Baht Baht Ordinary shares

11.

26,829,764

INVESTMENTS IN ASSOCIATED COMPANIES - NET Investments in associated companies as at December 31, 2015 and 2014, and dividends received from those investments for the years ended December 31, 2015 and 2014 were as follows:

Companyâ&#x20AC;&#x2122;s name

MFC Asset Management Public Company Limited Padaeng Industry Public Company Limited Country Group Development Public Company Limited Total

Nature of business

Country of incorporation

mutual fund zinc mine and a zinc smelter property development

Thailand

Shareholding (percentage) As at December 31, 2015 2014 -

24.9

Equity method As at December 31, 2015 2014

Unit : Million Baht Cost method Dividend As at For the years ended December 31, December 31, 2015 2014 2015 2014

546.6

532.6

74.8

Thailand

5.0

196.3

197.8

Thailand

2.8

289.0 485.3

546.6

298.6

109 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

Details and summarized financial information of the associated companies are as follows: Companyâ&#x20AC;&#x2122;s name

MFC Asset Management Public Company Limited Padaeng Industry Public Company Limited Country Group Development Public Company Limited

Companyâ&#x20AC;&#x2122;s name

MFC Asset Management Public Company Limited Padaeng Industry Public Company Limited Country Group Development Public Company Limited

Paid-up share capital As at December 31, 2015 2014

Total assets As at December 31, 2015 2014

Unit : Million Baht Total liabilities As at December 31, 2015 2014

120.0

1,579.1

2,260.0

5,104.7

1,523.8

7,336.3

10,141.4

4,224.7

Total revenues For the years ended December 31, 2015 2014 -

942.4

Net income For the years ended December 31, 2015 2014 -

229.1

Unit : Million Baht Total comprehensive income For the years ended December 31, 2015 2014

236.4

297.5

5,490.3

376.0

346.1

516.0

(479.8)

(452.2)

On March 3, 2014, the above investment in MFC Asset Management Public Company Limited, totaling 29,903,500 shares, are registered the pledge as collateral for borrowing from a financial institution. On February 16, 2015, the Company withdraws such investment in associated company that are registered the pledge as collateral for borrowing from a financial institution On March 5, 2015, the Company sold the above investment in MFC Asset Management Public Company Limited to the parent company as a whole. The Company recognizes profit from sales of such investment in the statement of profit or loss and other comprehensive income in which equity method is applied and the separate statement of profit or loss and other comprehensive income for the year ended December 31, 2015 amount of approximately Baht 103.8 million and approximately Baht 116.3 million, respectively.

110 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

12.

PROPERTY, PREMISES AND EQUIPMENT - NET FINANCIAL STATEMENTS IN WHICH EQUITY METHOD IS APPLIED AND SEPARATE FINANCIAL STATEMENTS Balance Additions Decreases Transfer in/ Balance as at (Transfer out) as at December 31, December 31, 2014 2015 Baht Baht Baht Baht Baht Cost : Property Premises Premises/leasehold improvement Furniture and office equipment Vehicles Leasehold improvement during construction Total cost Accumulated depreciation : Premises Premises/leasehold improvement Furniture and office equipment Vehicles Total accumulated depreciation Allowance for impairment Total

30,293,000 19,572,300 263,859,243 345,841,726 36,461,863

4,660,633 19,137,907 -

(12,388,179) (6,114,311) (15,205,863)

15,447,327 -

30,293,000 19,572,300 271,579,024 358,865,322 21,256,000

346,154 696,374,286

15,101,173 38,899,713

(33,708,353)

(15,447,327) -

701,565,646

(16,505,647) (183,903,706) (306,743,929) (35,027,217) (542,180,499) (1,934,254) 152,259,533

(343,951) (30,087,350) (18,039,915) (804,361) (49,275,577) -

9,809,463 5,474,794 15,205,856 30,490,113 582,845

(16,849,598) (204,181,593) (319,309,050) (20,625,722) (560,965,963) (1,351,409) 139,248,274

FINANCIAL STATEMENTS IN WHICH EQUITY METHOD IS APPLIED AND SEPARATE FINANCIAL STATEMENTS Balance Additions Decreases Transfer in/ Balance as at (Transfer out) as at December 31, December 31, 2013 2014 Baht Baht Baht Baht Baht

Cost : Property Premises Premises/leasehold improvement Furniture and office equipment Vehicles Leasehold improvement during construction Total cost Accumulated depreciation : Premises Premises/leasehold improvement Furniture and office equipment Vehicles Total accumulated depreciation Allowance for impairment Total

30,293,000 19,572,300 269,497,941 396,654,935 42,711,863

1,183,060 14,175,184 -

(27,169,255) (65,146,539) (6,250,000)

20,347,497 158,146 -

30,293,000 19,572,300 263,859,243 345,841,726 36,461,863

896,708 759,626,747

19,955,089 35,313,333

(98,565,794)

(20,505,643) -

346,154 696,374,286

(16,161,699) (172,956,141) (341,463,549) (40,472,858) (571,054,247) (1,949,953) 186,622,547

(343,948) (30,500,080) (25,578,779) (804,358) (57,227,165) -

19,552,515 60,298,399 6,249,999 86,100,913 15,699

Depreciation for the years ended December 31, 2015 2014

111 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

(16,505,647) (183,903,706) (306,743,929) (35,027,217) (542,180,499) (1,934,254) 152,259,533

Baht Baht

49,275,577 57,227,165

As at December 31, 2015 and 2014, certain premises and equipment items have been fully depreciated but are still in use. The original cost, before deducting accumulated depreciation, of those premises and equipment amounted to totaling approximately Baht 421.4 million and approximately Baht 462.6 million, respectively. As at December 31, 2014, the Company had finance lease for vehicles with a local leasing company. As at December 31, 2014, the carrying amount of leased vehicles is totaling approximately Baht 1.4 million. (2015 : nil) 13.

INTANGIBLE ASSETS - NET FINANCIAL STATEMENTS IN WHICH EQUITY METHOD IS APPLIED AND SEPARATE FINANCIAL STATEMENTS Remaining Balance as at Additions Decreases Transfer in/ Amortization Allowance for Balance as at useful lives December 31, (Transfer out) impairment December 31, 2014 2015 Baht Baht Baht Baht Baht Baht Baht Using derivatives business fee net Computer software - net Securities license Derivatives business membership Computer software in progress Total

76,045,784 2,657,500 15,945,000

160,768 -

2,706,324 -

78,912,876 2,657,500 15,945,000

3,577,670 98,225,958

4,021,798 4,182,566

(2,706,324) -

4,893,144 102,408,524

FINANCIAL STATEMENTS IN WHICH EQUITY METHOD IS APPLIED AND SEPARATE FINANCIAL STATEMENTS Remaining Balance Additions Decreases Transfer in/ Amortization Allowance for Balance useful lives as at (Transfer out) impairment as at December 31, December 31, 2013 2014 Baht Baht Baht Baht Baht Baht Baht Using derivatives business fee net Computer software - net 0 - 1 years Securities license Derivatives business membership Computer software in progress Total

71,693,766 2,657,500 15,945,000

553,350 (1,592,756) -

5,436,135 -

(44,711) -

76,045,784 2,657,500 15,945,000

6,279,180 96,575,450

2,734,625 3,287,975 (1,592,756)

(5,436,135) -

(44,711)

3,577,670 98,225,958

Amortization for the years ended December 31, 2015 2014

Baht Baht

44,711

As at December 31, 2015 and 2014, certain intangible assets have been fully amortized but are still in use. The original cost, before deducting accumulated amortization, of those intangible assets amounted to totaling approximately Baht 11.3 million.

112 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

14.

DEFERRED TAX ASSETS Deferred tax assets as at December 31, 2015 and 2014 are as follows: FINANCIAL STATEMENTS IN WHICH EQUITY METHOD IS APPLIED As at December 31, 2015 2014 Baht Baht Deferred tax assets

106,711,815 106,711,815

107,331,535 107,331,535

SEPARATE FINANCIAL STATEMENTS As at December 31, 2015 Baht

2014 Baht

106,711,815 106,711,815

107,331,535 107,331,535

Movements in Deferred tax assets during the years are as follows:

Temporary differences Allowance for doubtful accounts Allowance for impairment on investments Assets under finance leases Employee benefit obligations Surplus on re-measuring investments Others Total

Temporary differences Allowance for doubtful accounts Allowance for impairment on investments in associated companies Allowance for impairment on investments Assets under finance leases Employee benefits obligation Surplus on re-measuring investments Others Total

FINANCIAL STATEMENT IN WHICH EQUITY METHOD IS APPLIED Balance at Items as Items as Balance at January 1, recognized recognized December 31, 2015 into into Other 2015 Income or Loss Comprehensive Income (loss) Baht Baht Baht Baht 66,354,532 27,800,000 335,268 8,809,010 3,407,885 624,840 107,331,535

(554,355) (335,268) 1,033,974 (398,177) (253,826)

(365,894) (365,894)

65,800,177 27,800,000 9,842,984 3,041,991 226,663 106,711,815

FINANCIAL STATEMENT IN WHICH EQUITY METHOD IS APPLIED Balance at Items as Items as Balance at January 1, recognized recognized December 31, 2014 into into Other 2014 Income or Loss Comprehensive Income (loss) Baht Baht Baht Baht 65,822,393

532,139

38,482,742 27,800,000 237,945 9,372,972 764,931 574,047 143,055,030

(38,482,742) 97,323 1,161,252 50,793 (36,641,235)

(1,725,214) 2,642,954 917,740

113 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

66,354,532 27,800,000 335,268 8,809,010 3,407,885 624,840 107,331,535

Balance at January 1, 2015

Temporary differences Allowance for doubtful accounts Allowance for impairment on investments Assets under finance leases Employee benefits obligation Surplus on re-measuring investments Others Total

Baht 66,354,532 27,800,000 335,268 8,809,010 3,407,885 624,840 107,331,535 Balance at January 1, 2014

Baht

SEPARATE FINANCIAL STATEMENTS Items as Items as recognized recognized into into Other Income or Loss Comprehensive Income (loss) Baht Baht (554,355) (335,268) 1,033,974 (398,177) (253,826)

(365,894) (365,894)

SEPARATE FINANCIAL STATEMENTS Items as Items as recognized recognized into into Other Income or Loss Comprehensive Income (loss) Baht Baht

65,822,393

532,139

41,117,997 27,800,000 237,945 9,372,972 764,931 574,047 145,690,285

(41,117,997) 97,323 1,161,252 50,793 (39,276,490)

Balance at December 31, 2015 Baht 65,800,177 27,800,000 9,842,984 3,041,991 226,663 106,711,815 Balance at December 31, 2014 Baht

(1,725,214) 2,642,954 917,740

66,354,532 27,800,000 335,268 8,809,010 3,407,885 624,840 107,331,535

The Company used a tax rate of 20% for calculation of deferred tax for the years ended December 31, 2015 and 2014. 15.

OTHER ASSETS - NET

Withholding tax Prepaid expenses Clearing fund Advance receivables and loan to employees Leasehold right - net Investment property - net Deposits Accrued income Others Total

FINANCIAL STATEMENTS IN WHICH EQUITY METHOD IS APPLIED AND SEPARATE FINANCIAL STATEMENTS As at December 31, 2015 2014 Baht Baht 935,304 1,293,644 5,226,982 6,599,225 49,985,440 44,514,371 2,660,374 5,321,927 547,014 999,756 24,066,779 24,066,779 21,793,819 19,953,910 7,812,826 19,073,071 4,355,015 5,597,173 117,383,553 127,419,856

As at December 31, 2015 and 2014, such investment property - net is mortgaged as collateral for credit facility from a local financial institution.

114 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

16.

PAYABLES UNDER FINANCE LEASES As at December 31, 2015 and 2014, the Company leases vehicle under the long-term finance leases. The aggregate minimum rental commitment under the finance leases, are as follows: FINANCIAL STATEMENTS IN WHICH EQUITY METHOD IS APPLIED AND SEPARATE FINANCIAL STATEMENTS Minimum payments Present value of minimum payments As at December 31, As at December 31, 2015 2014 2015 2014 Baht Baht Baht Baht Not later than 1 year Later than 1 year but not later than 5 years

(Less) Deferred interest Total

17.

3,218,340 3,218,340 (107,369) 3,110,971

3,110,971 3,110,971 3,110,971

EMPLOYEE BENEFIT OBLIGATIONS The Company operates post-employment benefits plan under the Thai Labor Protection Act, which are considered as unfunded defined benefit plans. Employee benefit obligations as at December 31, 2015 and 2014 are as follows; FINANCIAL STATEMENTS IN WHICH EQUITY METHOD IS APPLIED AND SEPARATE FINANCIAL STATEMENTS As at December 31, 2015 2014 Baht Baht Post-employment benefit obligations Total

49,214,920 49,214,920

44,045,050 44,045,050

Amounts recognized in the statement of profit or loss and other comprehensive income for post-employment benefits are as follows: FINANCIAL STATEMENTS IN WHICH EQUITY METHOD IS APPLIED For the years ended December 31, 2015 2014 Baht Baht Current service cost Interest cost Components of employee benefit costs recognized in profit or loss Actuarial gain (losses) of associated companies Components of employee benefit costs recognized in other comprehensive income Total

115 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

13,005,760 1,312,540

8,934,137 1,043,760

14,318,300

9,977,897

(309,425)

8,626,069

(309,425) 14,008,875

8,626,069 18,603,966

SEPARATE FINANCIAL STATEMENTS For the years ended December 31, 2015 2014 Baht Baht Current service cost Interest cost Components of employee benefit costs recognized in profit or loss Total

13,005,760 1,312,540

8,934,137 1,043,760

14,318,300 14,318,300

9,977,897 9,977,897

Movements in the present value of the post-employment benefits obligation are as follows: FINANCIAL STATEMENTS IN WHICH EQUITY METHOD IS APPLIED AND SEPARATE FINANCIAL STATEMENTS For the years ended December 31, 2015 2014 Baht Baht Beginning balance of employee benefits obligation Current service cost Interest cost Actuarial gain on defined post-employment benefits plan (Less) Employee benefits paid during the years Balance at end of the years

44,045,050 13,005,760 1,312,540 (9,148,430) 49,214,920

46,864,861 8,934,137 1,043,760 (8,626,069) (4,171,639) 44,045,050

The principle actuarial assumptions used to calculate the obligation under the defined benefits plan as at December 31, 2015 and 2014 are as follows: FINANCIAL STATEMENTS IN WHICH EQUITY METHOD IS APPLIED AND SEPARATE FINANCIAL STATEMENTS As at December 31, 2015 2014 (% p.a.) (% p.a.) Financial assumptions Discount rate Employee turnover Expected rate of salary increase

3.0 0 - 23.0 Subject to the range of age of employees 0 - 4.0

116 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

3.0 0 - 23.0 Subject to the range of age of employees 0 - 4.0

Significant actuarial assumptions for the determination of the employee benefit obligations are discount rate, expected salary increase rate and mortality rate. The sensitivity analyses below have been determined based on reasonably possible changes of the respective assumption occurring at the end of the reporting period, while holding all other assumptions constant. Impact on the employee benefit obligations Increases (decreases) As at December 31, 2015 Baht Discount rate - increase by 1% Discount rate - decrease by 1% Salary increase rate - increase by 1% Salary increase rate - decrease by 1% Life expectancy - increase by 1 year Life expectancy - decrease by 1 year

(4,828,114) 5,548,794 6,025,481 (5,313,435) 417,462 (413,782)

The sensitivity analysis presented above may not be representative of the actual change in the employee benefit obligations as it is unlikely that the change in assumptions would occur in isolation of one another as some of the assumptions may be correlated. Furthermore, in presenting the above sensitivity analysis, the present value of the employee benefit obligations have been calculated using the Projected Unit Credit Method at the end of the report period, which is the same as that applied in calculating the post-employment benefit obligations liability recognized in the statement of financial position. 18.

OTHER LIABILITIES FINANCIAL STATEMENTS IN WHICH EQUITY METHOD IS APPLIED AND SEPARATE FINANCIAL STATEMENTS As at December 31, 2015 2014 Baht Baht Accrued bonuses Accrued marketing incentive Accrued profit sharing from branches/ marketing teams management Withholding tax and specific business tax payable Value-added-tax payable Other payables Accrued corporate income tax Accrued other expenses Total

117 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

47,626,317 3,361,133

49,933,519 9,201,589

12,417,237 6,121,902 3,623,914 10,434,409 3,456,139 34,428,784 121,469,835

20,793,642 10,700,362 6,686,312 15,777,320 38,635,210 36,615,013 188,342,967

19.

SHARE CAPITAL On April 22, 2013, the Annual General Shareholders’ Meeting for the year 2013 passed a resolution to approve the decrease of the Company’s registered capital of 818,741,975 shares by eliminating unsubscribed shares and on May 3, 2013, the Company registered the decrease in the Company’s registered capital at the Department of Business Development of the Ministry of Commerce. The Company’s registered capital were 2,330,807,341 shares at the par value of Baht 1.00 per share, amounting in total to Baht 2,330,807,341. Moreover, the Annual General Shareholders’ Meeting for the year 2013 passed a resolution to increase the registered capital of the Company from Baht 2,330,807,341 to Baht 3,189,785,935 by issuing of 858,978,594 new ordinary shares at the par value of Baht 1.00 per share to reserve for stock dividend of 258,978,594 shares and the exercise of ESOP Warrants Program No. 2 amounting to 600,000,000 shares and on May 7, 2013, the Company registered the increase in registered capital at the Department of Business Development of the Ministry of Commerce. The Company’s registered capital were 3,189,785,935 shares at the par value of Baht 1.00 per share, amounting in total to Baht 3,189,785,935. Also, the Annual General Shareholders’ Meeting for the year 2013 passed a resolution to allocate 858,978,594 new ordinary shares at a par value of Baht 1.00 per share from Baht 2,330,807,341 to Baht 3,189,785,935 by allocation of 258,978,594 new ordinary shares at a par value of Baht 1.00 to reserve for stock dividend and allocation of 600,000,000 new ordinary shares at a par value of Baht 1.00 to reserve for the exercise of warrant holders of the Company under the ESOP No. 2. On May 20, 2013, the Company paid the stock dividend at the ratio of 9 existing share to 1 stock dividend, totaling 258,936,143 shares. And on May 21, 2013, the Company registered the increase in issued and paid-up share capital of 258,936,143 shares with the Department of Business Development of the Ministry of Commerce. Subsequently, the Stock Exchange of Thailand acknowledged the increase of the issued and paid-up share capital and has allowed to be traded on the Stock Exchange of Thailand since May 23, 2013. On April 29, 2014, The Annual General Shareholders’ Meeting for the year 2014 passed a resolution to approve the business restructuring plan of the Company. According to such restructuring plan, the Company will establish the Holding Company under the name “Country Group Holdings Public Company Limited” which will be a public limited company, in order to engage in the business of investment and to hold the shares of the Company. Country Group Holdings will make a tender offer for all the securities of the Company by exchanging them for the securities of the same type of Country Group Holdings, with the exchange rate of 1 per 1, namely one ordinary share of the Company per one ordinary share of Country Group Holdings. After the tender offer is successful (holding more than or equal 75% of the sharers), Country Group Holdings will be the major shareholder of the Company and the ordinary shares of Country Group Holdings will be the securities listed on the Stock Exchange in place of the ordinary shares of the Company which will be simultaneously delisted from being the securities listed on the Stock Exchange.

118 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

In order to persuade and return the favour to the shareholders of the Company in this business restructuring, after the Business Restructuring is complete and the ordinary shares of Country Group Holdings are listed as securities on the Stock Exchange in replace of the ordinary shares of the Company, Country Group Holdings will issued the warrant to buy ordinary shares of Country Group Holdings to the shareholders who have exchanged their shares in accordance with the business restructuring plan. The warrants will be issued pursuant to the proportion of the amount of shares held by each shareholder in Country Group Holdings after the business restructuring is completed, in a proportion of 3 swapped ordinary shares per 1 unit of warrants, free of charge, and fraction will be rounded down. In exercising the right of the warrants, 1 unit of warrant is eligible for buying 1 ordinary share of Country Group Holdings. Furthermore, the Annual General Shareholders’ Meeting for the year 2014 passed a resolution to approve the reduction in the registered capital of the Company from Baht 3,189,785,935 to Baht 2,589,743,484 by writing off the unsold shares of the Company amounting to 600,042,451 shares, with the par value of Baht 1.00 per share remaining from the reserve for stock dividend 42,451 shares and the exercise of ESOP Warrants program No.2 in amount of 600,000,000 units. On May 12, 2014, the Company registered the decrease in the Company’s registered capital at the department of Business Development of the Ministry of Commerce. The company’s registered capital were 2,589,743,484 shares at the par value of Baht 1.00 per share, amounting in total to Baht 2,589,743,484. On October 17, 2014, the Office of The Securities and Exchange Commission allow Country Group Holdings to make a tender offer for all the securities of the Company. On December 25, 2014, the Company reported that as a result of the tender offer, Country Group Holdings had acquired 2,566,219,121 shares or 99.1% of the total number of paid up shares of the Company by exchanging them for the securities of the same type of Country Group Holdings. As a result, Country Group Holdings is the major shareholder of the Company. In addition, the ordinary shares of Country Group Holdings is the securities listed on the Stock Exchange in place of the ordinary shares of the Company which is simultaneously delisted from being the securities listed on the Stock Exchange on January 8, 2015. 20.

PREMIUM ON SHARE CAPITAL The premium on share capital account is set up under the provisions of Section 51 of the Public Companies Act B.E. 2535, which requires companies to set aside share subscription monies received in excess of the par value of the shares issued to a reserve account (“premium on share capital”). Premium on share capital is not available for dividend distribution.

119 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

21.

WARRANT GRANTED UNDER THE EMPLOYEE STOCK OWNERSHIP PROGRAM On April 22, 2013, the Annual General Shareholders’ Meeting for the year 2013 passed a resolution to approve the issuance and offering warrants to purchase the ordinary shares of the Company under the Employees Stock Ownership Program (“ESOP”) No. 2 in the amount not exceeding 600,000,000 units to directors, managements, employees and/or advisors of the Company for free. The tenors of warrants is not over 3 years from the issuance date of warrants. Also 1 unit of warrant will be entitled to purchase 1 new ordinary share at the price of Baht 1.30. The Company has not issued and offered the warrants to buy ordinary shares of the Company, in accordance with ESOP program No. 2. On April 29, 2014, the Annual General Shareholders’ Meeting for the year 2014 passed a resolution to approve the cancellation of the issuance and offering of the warrants to buy ordinary shares of the Company, to the directors, managements, employees and/or advisors of the Company in accordance with ESOP Program No. 2 in the amount not exceeding 600,000,000 units as mention above. As the result of the Company operated to do business restructuring plan, all stocks of the Company would be provoked from being listed company. This effected to the stocks owned by the directors, managements, employees and/or advisors of the Company which received from warrant had no market to purchase these stocks and did not serve the purpose of ESOP Program No. 2. Besides, Country Group Holdings was defined to comply with the Business Restructuring Plan for issuance and offering of the warrants to buy ordinary shares of Country Group Holdings, to the directors, managements, employees and/or advisors of Country Group Holdings. Moreover, the Company would do as condition of this project which was approved by the 2013 Annual General Meeting. Excepted that shareholder meeting of Country Group Holdings will resolve otherwise after succession of Business Restructuring Plan. On June 12, 2014, the Extraordinary General Shareholders’ Meeting No. 1/2014 of Country Group Holdings passed resolutions to approve the ESOP warrants program CGH-ESOP1 according to the business restructuring plan to issue and offer of warrants to purchase Country Group Holdings’s ordinary shares to the directors, executives, employees and/or advisors of the Company and Country Group Holdings (CGH-ESOP1) in the amount not exceeding 600,000,000 units for free to motivate and reward the directors, executives and employees of the Company and Country Group Holdings. Due to CGH-ESOP1 program has certain features in its terms and conditions differing from CGS-ESOP2, therefore Country Group Holdings has to propose to the Shareholders’ Meeting of Country Group Holdings to reconsider after the restructuring is completed according to the business restructuring plan.

120 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

On April 29, 2015, the Annual General Shareholders’ Meeting for the year 2015 of Country Group Holdings passed a resolution to approve the ESOP warrants program CGH-ESOP1 an issuance and offering of warrants to purchase ordinary shares of Country Group Holdings to the directors, executives, employees and/or advisors of the Company and/or Country Group Holdings under ESOP warrants program CGH-ESOP1. The warrants is specified the name of the holder and non-transferable in the amount not exceeding 600,000,000 units, free of charge, with the period of warrants not more than 3 years from the date of issuance of offering of the warrants, 1 units of warrant is entitled to buy 1 ordinary share. The exercise price is Baht 1.80 per share. The warrant holder can exercise the rights to purchase the ordinary shares of Country Group Holdings after 6 months since the issuance date of the warrants. The warrant holders can exercise the right to purchase ordinary shares of Country Group Holdings every 6 months of the last working day of March and September until the last exercise date. In addition, these warrants are not registered to be traded on the Stock Exchange but the new share capital from exercised warrants will be registered to be traded on the Stock Exchange. 22.

CAPITAL MANAGEMENT The Company’s objectives in managing capital are to safeguard the Company’s ability to continue as a going concern in order to provide returns for shareholder and benefits for other stakeholders and to maintain an optimal capital structure.

23.

DIVIDEND PAID On April 29, 2014, the Annual General Shareholders’ Meeting for the year 2014 passed a resolution to approve the profit allocation as the statutory reserve to the amount of Baht 55,574,679 and approve the dividend payment for the year 2013 at the rate of Baht 0.11 per share, totaling Baht 284,829,429. Such dividend was already paid on May 15, 2014. On April 23, 2015, the Annual General Shareholders’ Meeting for the year 2015 passed a resolution to approve the profit allocation as the statutory reserve to the amount of Baht 75,408,087 and approve the dividend payment for the year 2014 at the rate of Baht 0.092 per share, totaling Baht 238,233,236. Such dividend was already paid on May 22, 2015. On July 28, 2015, the Board of Directors’ Meeting of the Company passed a resolution to approve the interim dividend payment to the shareholders at the rate of Baht 0.16 per share, totaling Baht 414,318,674 and proposed to the Board of Directors’ Meeting of Country Group Holdings. And on July 28, 2015, the Board of Directors’ Meeting of Country Group Holdings has already passed a resolution to approve such interim dividend payment. Such interim dividend was already paid on August 26, 2015.

121 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

24.

STATUTORY RESERVE The Company is required to set aside a statutory reserve at least 5% of its net income after deducting accumulated deficit brought forward (if any) until the reserve reaches 10% of the authorized share capital according to the Public Limited Companies Act B.E. 2535, section 116. The statutory reserve could not be used for dividend payment.

25.

BROKERAGE FEES FINANCIAL STATEMENTS IN WHICH EQUITY METHOD IS APPLIED AND SEPARATE FINANCIAL STATEMENTS For the years ended December 31, 2015 2014 Baht Baht Brokerage fees from securities business Brokerage fees from derivatives business Total

26.

838,895,079 29,604,097 868,499,176

985,503,909 39,200,643 1,024,704,552

FEES AND SERVICES INCOME FINANCIAL STATEMENTS IN WHICH EQUITY METHOD IS APPLIED AND SEPARATE FINANCIAL STATEMENTS For the years ended December 31, 2015 2014 Baht Baht Underwriting fee Financial advisory fee Investment advisory fee Others Total

27.

24,657,000 27,678,399 280,716 8,526,668 61,142,783

31,362,125 10,672,132 252,965 19,429,777 61,716,999

OTHER INCOME FINANCIAL STATEMENTS IN WHICH EQUITY METHOD IS APPLIED AND SEPARATE FINANCIAL STATEMENTS For the years ended December 31, 2015 2014 Baht Baht Reverse impairment from investment is associated company Gain on disposal assets Income from the overdue payment charge Others Total

122 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

3,140,292 183,213 12,146,343 15,469,848

205,589,985 3,653,830 216,592 28,515,313 237,975,720

28.

KEY MANAGEMENT BENEFIT EXPENSES The Company records the expense of salaries, remunerations, other monetary benefits and post-employment benefits paid to the Company’s management, in accordance with the Notification of the definitions of the Office of the Securities and Exchange Commission, management under such definition includes a chief executive officer, the next four executive levels immediately below the chief executive officer and all persons in positions comparable to these fourth executive levels as follow: FINANCIAL STATEMENTS IN WHICH EQUITY METHOD IS APPLIED AND SEPARATE FINANCIAL STATEMENTS For the years ended December 31, 2015 2014 Baht Baht Short term employee benefits Post-employment benefits Total

29.

113,088,120 1,085,799 114,173,919

108,847,155 1,832,326 110,679,481

DIRECTORS’ REMUNERATION Directors’ remuneration represents the benefits paid to the Company’s directors in accordance with Section 90 of the Public Limited Companies Act, exclusive of salaries and related benefits payable to directors who hold executive position. Directors’ remuneration was approved by the ordinary shareholders’ meeting of the Company.

30.

OTHER EXPENSES FINANCIAL STATEMENTS IN WHICH EQUITY METHOD IS APPLIED AND SEPARATE FINANCIAL STATEMENTS For the years ended December 31, 2015 2014 Baht Baht Taxes and duties Professional and other fees Entertainment expenses Gasoline and travelling expenses Information and communication expenses Stationery and office supplies Advertising and promotion expenses Others Total

123 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

3,320,255 17,566,563 22,264,640 12,447,135 29,528,295 4,341,403 7,419,193 18,865,835 115,753,319

3,663,461 27,615,725 22,371,514 13,270,364 33,301,280 5,063,649 11,152,102 17,439,603 133,877,698

31.

PROVIDENT FUND On November 1, 2002, the Company set up a provident fund for those employees who elected to participate. The contributions from the employees are deducted from their monthly salaries, and the Company matches the individualsâ&#x20AC;&#x2122; contributions. At the present, the provident fund is managed by MFC Asset Management Public Company Limited, authorized financial institution in accordance with the Provident Fund Act B.E. 2530 (1987). For the years ended December 31, 2015 and 2014, the Company has contributed approximately Baht 12.7 million and Baht 12.8 million, respectively, to the fund.

32.

INCOME TAX EXPENSES Income tax for the years ended December 31, 2015 and 2014, are as follows: Unit : Thousand Baht SEPARATE FINANCIAL STATEMENTS

FINANCIAL STATEMENTS IN WHICH EQUITY METHOD IS APPLIED As at December 31, 2015 2014 Baht Baht Current income tax for the years Deferred tax Total income tax expenses

52,804 254 53,058

As at December 31, 2015 2014 Baht Baht

43,099 36,641 79,740

52,804 254 53,058

43,099 39,276 82,375

Reconciliation of effective tax rate FINANCIAL STATEMENTS IN WHICH EQUITY METHOD IS APPLIED For the year ended December 31, 2015 2014 (Thousand Rate (Thousand Rate Baht) (%) Baht) (%) Income before income tax Income tax at the domestic tax rate Tax effect of income and expenses that are not taxable and not deductible for tax purpose Income tax as statements of comprehensive income

232,571 46,514

464,691 92,938

Unit : Thousand Baht SEPARATE FINANCIAL STATEMENTS For the year ended December 31, 2015 2014 (Thousand Rate (Thousand Rate Baht) (%) Baht) (%) 249,410 49,882

479,043 95,809

6,544

(13,198)

3,176

(13,434)

53,058

79,740

53,058

82,375

According to the Royal Decree No. 555 B.E. 2555 issued under the Revenue Code regarding the corporate income tax rate reduction effective on December 27, 2012, the corporate income tax rates were reduced from 30% to 23% of net income for an accounting period beginning on or after January 1, 2012 and 20% of net income for two consecutive accounting period beginning on or after January 1, 2013 and according to the Royal Decree No. 577 B.E. 2557 issued under the Revenue Code regarding the corporate income tax rate reduction effective on November 11, 2014, the corporate income tax rates were reduced from 30% to 20% of net income for an accounting period beginning on or after January 1, 2015, up to December 31, 2015.

124 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

On January 22, 2016, The National Legislative Assembly has approved a reduction of the corporate income tax rate from 30% to 20% of net taxable profit for the accounting period which begins on or after January 1, 2016. Therefore, the Company used tax rate of 20% for the corporate income tax calculation for the years ended December 31, 2015 and 2014, respectively. Income tax recognized in component of other comprehensive income (loss) Baht

Surplus (deficit) on re-measuring investment Actuarial gain (losses) on defined post-employment benefit plans Total

FINANCIAL STATEMENTS IN WHICH EQUITY METHOD IS APPLIED For the years ended December 31, 2015 2014 Before-tax Tax (expense) Net-of-tax Before-tax Tax (expense) Amount Benefit Amount Amount Benefit

Net-of-tax Amount

(6,894,980)

321,962

(6,573,018)

4,931,750

(1,162,351)

3,769,399

(309,425) (7,204,405)

61,885 383,847

(247,540) (6,820,558)

8,626,069 13,557,819

(1,725,214) (2,887,565)

6,900,855 10,670,254 Baht

SEPARATE FINANCIAL STATEMENTS For the years ended December 31,

Surplus (deficit) on re-measuring investment Actuarial gain on defined post-employment benefit plans Total

33.

2015 Tax (expense) Benefit

Net-of-tax Amount

Before-tax Amount

1,829,468

(365,894)

1,463,574

(14,094,771)

2,642,954

(11,451,817)

1,829,468

(365,894)

1,463,574

8,626,069 (5,468,702)

(1,725,214) 917,740

6,900,855 (4,550,962)

Before-tax Amount

2014 Tax (expense) Benefit

Net-of-tax Amount

COMMITMENTS AND CONTINGENT LIABILITIES 33.1

As at December 31, 2015 and 2014, the Company had operating lease commitments for office building and vehicles as follows: Unit : Million Baht FINANCIAL STATEMENTS IN WHICH EQUITY METHOD IS APPLIED AND SEPARATE FINANCIAL STATEMENTS As at December 31, 2015 2014 Not later than 1 year Later than 1 year but not later than 5 years Total

33.2

34.7 35.5 70.2

53.7 25.1 78.8

As at December 31, 2015 and 2014, the Company has the outstanding commitment in respect of benefit paid to employees which the Company had already entered of Baht 9.1 million and Baht 26.7 million, respectively.

125 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

34.

RELATED PARTY TRANSACTIONS Related parties are those parties linked to the Group and Company by common shareholders or directors. Transactions with related parties are conducted at the pricing policy based on the normal course of business conditions. The pricing policies for particular types of transactions are explained further below: Pricing policies Brokerage fees Fees and services income Expenses

At market price which is the same rate as general client At agreed price which approximates market value At market price

Significant balances with related parties as at December 31, 2015 and 2014 are as follows:

Relationship

FINANCIAL STATEMENTS IN WHICH EQUITY METHOD IS APPLIED AND SEPARATE FINANCIAL STATEMENTS As at December 31, 2015 2014 Baht Baht

Deposits for customersâ&#x20AC;&#x2122; account Related persons Country Group Holdings Public Company Limited Country Group Development Public Company Limited Total

Related persons Parent company Associate

133,677 1,300,905 10,185,045 11,619,627

Securities and derivatives business receivables - net Related persons Country Group Holdings Public Company Limited Total

Related persons Parent company

8,563,803 2,683,654 11,247,457

Investment - net Mutual fund managed by related company

Related company

338,735

407,736

Other asset - net Country Group Holdings Public Company Limited

Parent company

428,600

2,518,396

Accrued expenses Sing Sian Yer Pao Company Limited

Related company

126 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

75,475 10,076,529 10,152,004

256,800

Significant transactions with related parties for the years ended December 31, 2015 and 2014 are as follows: Relationship

Brokerage fees from securities business Related persons Country Group Holdings Public Company Limited Mutual fund managed by related company Country Group Development Public Company Limited Total

FINANCIAL STATEMENTS IN WHICH EQUITY METHOD IS APPLIED For the years ended December 31, 2015 2014 Baht Baht

SEPARATE FINANCIAL STATEMENTS For the years ended December 31, 2015 2014 Baht Baht

Related persons Parent company Related company Associate

662,188 1,899,525 9,354,236 54,922 11,970,871

1,199,548 45,121,017 245,758 46,566,323

662,188 1,899,525 9,354,236 54,922 11,970,871

1,199,548 45,121,017 245,758 46,566,323

Related company

201,956

426,128

201,956

426,128

Related company Parent company Associate

55,264 506,000 561,264

252,965 5,000,000 5,252,965

55,264 506,000 561,264

252,965 5,000,000 5,252,965

Gain on investments Country Group Holdings Public Company Limited

Parent company

3,090,431

Dividend income MFC Asset Management Public Company Limited

Related company

Related persons Parent company

121,457 850,000 971,457

Ongoing fee MFC Asset Management Public Company Limited Fee and services income MFC Asset Management Public Company Limited Country Group Holdings Public Company Limited Country Group Development Public Company Limited Total

Interest income Related person Country Group Holdings Public Company Limited Total

3,090,431 7,937 7,937

121,457 850,000 971,457

74,758,750 7,937 7,937

Finance Costs Related person Country Group Holdings Public Company Limited Country Group Development Public Company Limited Total Premises and equipment expenses EDP Enterprise Company Limited

Related persons Parent company Associate

163,200 728,489 109,584 1,001,273

175,640 50,439 226,079

163,200 728,489 109,584 1,001,273

175,640 50,439 226,079

Related company

1,238,485

Other expenses - Advertising expenses Sing Sian Yer Pao Company Limited

Related company

946,950

1,021,850

946,950

1,021,850

Directors Related persons Related company Related company Parent company

648,007,405 648,007,405

56,662,250 17,672,083 10,188,277 6,013,345 90,535,955

648,007,405 648,007,405

56,662,250 17,672,083 10,188,277 6,013,345 90,535,955

Dividend paid Related persons Related persons Mutual fund managed by related company Related company Country Group Holdings Public Company Limited Total

127 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

35.

OPERATING SEGMENT INFORMATION The Company discloses operating segments information in accordance with the Thai Financial Reporting Standard No. 8 (Revised 2014) “Operating Segments” and under the same basis as internal management reports presented to the Company’s chief operating decision maker for resources allocation to and performance evaluation of various segments. The Company’s business operations involve 3 principal segments: securities and derivatives brokerage segment, investment banking segment and securities and derivatives trading segment. These operations are carried on in Thailand. Below is the operating segment of the Company information for the years ended December 31, 2015 and 2014. Unit : Thousand Baht

Revenues: Brokerage fees Fees and services income Gain (loss) on investments and derivatives Share of profit (loss) from investments for using the equity method Interest and dividends Interest on margin loans Profit from sales of investments in associated companies Other income Total revenues Expenses Income before income tax Income tax expenses Net income for the years

Securities and derivatives brokerage segment 2015 2014

FINANCIAL STATEMENTS IN WHICH EQUITY METHOD IS APPLIED For the years ended December 31, Securities and Investment banking derivatives segment trading segment Other segment 2015 2014 2015 2014 2015 2014

2015

866,715 1,024,705 8,511 22,225 (451) (1,224)

52,632 -

868,499 61,143 117,536

1,024,705 61,717 102,205

46,335

45,070

921,110

1,090,776

52,632

1,784 39,492 117,987 -

103,429

Total

2014

16,479 -

14,809 -

(4,278) 40,243 -

60,406 53,481 -

(4,278) 56,722 46,335

60,406 68,290 45,070

39,492 136,250

118,238

103,777 15,470 155,212

237,976 351,863

103,777 15,470 1,265,204 (1,032,634) 232,570 (53,058) 179,512

237,976 1,600,369 (1,135,678) 464,691 (79,740) 384,951

Unit : Thousand Baht

Revenues: Brokerage fees Fees and services income Gain on investments and derivatives Interest and dividends Interest on margin loans Profit from sales of investments in associated companies Other income Total revenues Expenses Income before income tax Income tax expenses Net income for the years

Securities and derivatives brokerage segment 2015 2014

SEPARATE FINANCIAL STATEMENTS For the years ended December 31, Securities and Investment banking derivatives segment trading segment Other segment 2015 2014 2015 2014 2015 2014

2015

Total

2014

866,715 8,511 (451) 46,335

1,024,705 22,225 (1,224) 45,070

52,632 -

39,492 -

1,784 117,987 16,479 -

103,429 14,809 -

40,243 -

128,239 -

868,499 61,143 117,536 56,722 46,335

1,024,705 61,717 102,205 143,048 45,070

921,110

1,090,776

52,632

39,492

136,250

116,339 15,470 118,238 172,052

237,976 366,215

116,339 15,470 1,282,044 (1,032,634) 249,410 (53,058) 196,352

237,976 1,614,721 (1,135,678) 479,043 (82,375) 396,668

128 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

Assets classified by segment Unit: Baht

Assets by segment

Securities and derivatives brokerage segment

Investment banking segment

As at December 31, 2015 As at December 31, 2014

1,501,782,216 2,541,625,565

548,310 3,109,047

36.

Securities and derivatives trading segment 913,527,732 1,531,551,672

Unallocated assets

Total segments 2,415,858,258 4,076,286,284

Total

1,673,168,142 1,681,501,159

4,089,026,400 5,757,787,443

RISK MANAGEMENT 36.1

Credit risk Credit risk is the risk that the party to a financial instrument will fail to fulfill an obligation causing the Company to incur a financial loss. The financial assets of the Company are not subject to significant concentration of credit risk. The maximum credit risk exposure is the carrying amount of the financial assets, less provision for losses, as stated in the statements of financial position.

36.2

Interest rate risk Interest rate risk is the risk that the value of a financial instrument will fluctuate due to changes in market interest rates and it will affect the operation results of the Company and its cash flows. Unit : Million Baht FINANCIAL STATEMENT IN WHICH EQUITY METHOD IS APPLIED As at December 31, 2015 Outstanding balances of net financial instruments Repricing or maturity dates Floating Less than 1-5 Over NonNo Total Interest rate (%) rate 1 year years 5 years performing interest Floating Fixed receivables rate rate

Financial assets Cash and cash equivalents Deposits at financial institutions Receivables from Clearing house Securities and derivatives business receivables - net Investments - net Financial liabilities Payables to Clearing House Securities business payables

1,320.3 -

69.3 -

65.1 1.385.4 69.3 46.6 46.6

486.7 -

326.2

757.2 1,243.9 6.25 - 18.00 66.5 392.7 3.50 â&#x20AC;&#x201C; 5.50

235.4 674.4

129 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

235.4 674.4

0.10 - 1.10 -

1.10 â&#x20AC;&#x201C; 1.55 -

Unit : Million Baht FINANCIAL STATEMENT IN WHICH EQUITY METHOD IS APPLIED As at December 31, 2014 Outstanding balances of net financial instruments Repricing or maturity dates Floating Less than 1-5 Over NonNo Total Interest rate (%) rate 1 year years 5 years performing interest Floating Fixed receivables rate rate Financial assets Cash and cash equivalents Deposits at financial institutions Receivables from Clearing house Securities and derivatives business receivables - net Investments - net Financial liabilities Payables to Clearing House Securities business payables Payables under finance leases

1,090.3 -

269.3 -

633.6 -

683.2

3.1

54.3 1,144.6 269.3 32.2 32.2

0.13 - 1.30 -

1.40 - 2.00 -

1,670.6 2,304.2 6.25 - 18.00 292.4 975.6 -

4.30 - 5.50

187.7 187.7 1,846.2 1,846.2 3.1

7.33

Unit : Million Baht SEPARATE FINANCIAL STATEMENT As at December 31, 2015 Outstanding balances of net financial instruments Repricing or maturity dates Floating Less than 1-5 Over NonNo Total rate 1 year years 5 years performing interest receivables Financial assets Cash and cash equivalents Deposits at financial institutions Receivables from Clearing house Securities and derivatives business receivables - net Investments - net Financial liabilities Payables to Clearing House Securities business payables

Interest rate (%) Floating Fixed rate rate

1,320.3 -

69.3 -

65.1 1,385.4 69.3 46.6 46.6

486.7 -

326.2

757.2 1,243.9 6.25 â&#x20AC;&#x201C; 18.00 66.5 392.7 3.50 â&#x20AC;&#x201C; 5.50

235.4 674.4

130 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

235.4 674.4

0.10 - 1.10 -

1.10 - 1.55 -

Unit : Million Baht SEPARATE FINANCIAL STATEMENT As at December 31, 2014 Outstanding balances of net financial instruments Repricing or maturity dates Floating Less than 1-5 Over NonNo Total rate 1 year years 5 years performing interest receivables Financial assets Cash and cash equivalents Deposits at financial institutions Receivables from Clearing house Securities and derivatives business receivables - net Investments - net Financial liabilities Payables to Clearing House Securities business payables Payables under finance leases

Interest rate (%) Floating Fixed rate rate

1,090.3 -

269.3 -

54.3 32.2

633.6 -

683.2

1,670.6 292.4

2,304.2 6.25 - 18.00 975.6 4.30 - 5.50

187.7 1,846.2 -

187.7 1,846.2 3.1

3.1

1,144.6 0.13 - 1.30 269.3 32.2 -

1.40 - 2.00 -

7.33

The average yields on the average financial asset balances and the average cost of funds on average financial liabilities for interest bearing financial instruments are presented in the following table: Unit : Million Baht FINANCIAL STATEMENT IN WHICH EQUITY METHOD IS APPLIED As at December 31, 2015 Average Interest Average yield balance income/expenses (%) Financial assets Cash and cash equivalents Deposits at financial institutions Securities and derivatives business receivables - net Investments - net Financial liabilities Payables under finance leases

1,051.9 169.3

22.5 2.5

2.1 1.5

546.0 600.1

46.3 7.9

8.5 1.3

3.0

0.1

4.7

Unit : Million Baht FINANCIAL STATEMENT IN WHICH EQUITY METHOD IS APPLIED As at December 31, 2014 Average Interest Average yield balance income/expenses (%) Financial assets Cash and cash equivalents Deposits at financial institutions Securities and derivatives business receivables - net Investments - net Financial liabilities Payables under finance lease

131 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

1,031.2 386.0

16.6 7.0

1.6 1.8

553.4 307.6

45.1 8.0

8.1 2.6

3.4

0.2

4.8

Unit : Million Baht SEPARATE FINANCIAL STATEMENT As at December 31, 2015 Average Interest Average yield balance income/expenses (%) Financial assets Cash and cash equivalents Deposits at financial institutions Securities and derivatives business receivables - net Investments - net Financial liabilities Payables under finance leases

1,051.9 169.3

22.5 2.5

2.1 1.5

546.0 600.1

46.3 7.9

8.5 1.3

3.0

0.1

4.7

Unit : Million Baht SEPARATE FINANCIAL STATEMENT As at December 31, 2014 Average Interest Average yield balance income/expenses (%) Financial assets Cash and cash equivalents Deposits at financial institutions Securities and derivatives business receivables - net Investments - net Financial liabilities Payables under finance leases

36.3

1,031.2 386.0

16.6 7.0

1.6 1.8

553.4 307.6

45.1 8.0

8.1 2.6

3.4

0.2

4.8

Liquidity risk Liquidity risk is the risk that the Company will be unable to liquidate financial assets and/or procure sufficient funds to discharge obligations in a timely manner, resulting in a financial loss. Under the Notification of the Office of the Securities and Exchange Commission No. KorTor 18/2549 regarding â&#x20AC;&#x153;Net Capital Ratio - NCRâ&#x20AC;?, the securities company has to maintain its net capital requirement at the end of the day not less than Baht 15.0 million and not less than 7% of general liabilities. The Company was granted securities business licenses of derivatives agent under the Derivative Act. The Company has to maintain its net liquid capital at the end of working day at least Baht 25.0 million and at least 7% of general liabilities and assets held as collateral except in case the Company discontinued its derivatives agent business and notified to the Office of the Securities and Exchange Commission, the Company has to maintain its net liquid capital as mentioned in the second paragraph.

132 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

Additionally, in accordance with the regulation of Thailand Clearing House Co., Ltd. (“TCH”) chapter 300 “Members” regarding the “Qualification of an Associated Member”, the Associated Member is required to have total owners’ equity of not less than Baht 150.0 million and/or have a financial condition in accordance with the criteria prescribed by an agency in charge of overseeing the business operations of such juristic person under relevant law. As at December 31, 2015 and 2014, the Company has net capital per requirement of approximately Baht 2,125.7 million and approximately Baht 1,918.9 million, respectively or 216.4% and 88.0%, of general liabilities and assets held as collateral, respectively. The periods of time from the statement of financial position date to the maturity dates instruments as of December 31, 2015 and 2014 are as follows:

of financial

Unit: Million Baht FINANCIAL STATEMENT IN WHICH EQUITY METHOD IS APPLIED As at December 31, 2015 Outstanding balances of net financial instruments At call Within 1-5 Over No Non-performing Total 1 year years 5 years maturity receivables Financial assets Cash and cash equivalents Deposits at financial institutions Receivables from Clearing House Securities and derivatives business receivables - net Investments - net Financial liabilities Payables to Clearing House Securities business payables

46.6

1,385.4 69.3 -

1,385.4 69.3 46.6

486.7 -

712.2 331.7

45.0 61.0

1,243.9 392.7

235.4 674.4

Unit: Million Baht FINANCIAL STATEMENT IN WHICH EQUITY METHOD IS APPLIED As at December 31, 2014 Outstanding balances of net financial instruments At call Within 1-5 Over No Non-performing Total 1 year years 5 years maturity receivables Financial assets Cash and cash equivalents Deposits at financial institutions Receivables from Clearing House Securities and derivatives business receivables - net Investments - net Financial liabilities Payables to Clearing House Securities business payables Payables under finance leases

200.0 -

32.2

1,144.6 69.3 -

1,144.6 269.3 32.2

633.6 -

1,628.5 689.2

42.1 286.4

2,304.2 975.6

187.7 1,846.2 3.1

133 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

Unit: Million Baht

At call Financial assets Cash and cash equivalents Deposits at financial institutions Receivables from Clearing House Securities and derivatives business receivables - net Investments - net Financial liabilities Payables to Clearing House Securities business payables

SEPARATE FINANCIAL STATEMENT As at December 31, 2015 Outstanding balances of net financial instruments Within 1-5 Over No Non-performing 1 year years 5 years maturity receivables

Total

46.6

1,385.4 69.3 -

1,385.4 69.3 46.6

486.7 -

712.2 331.7

45.0 61.0

1,243.9 392.7

235.4 674.4

Unit: Million Baht

36.4

SEPARATE FINANCIAL STATEMENT As at December 31, 2014 Outstanding balances of net financial instruments Within 1-5 Over No Non-performing 1 year years 5 years maturity receivables

Total

200.0 -

32.2

1,144.6 69.3 -

1,144.6 269.3 32.2

633.6 -

1,628.5 689.2

42.1 286.4

2,304.2 975.6

187.7 1,846.2 3.1

Market risk The Companyâ&#x20AC;&#x2122;s exposure to market risk is the risk that volatility on the stock price and derivatives price that will substantially reduce the value of the Companyâ&#x20AC;&#x2122;s investments. However, the Company manages such risk at acceptable levels through risk management policies, and establishment of proper risk limits and parameters, as well as a market risk monitoring function.

36.5

Foreign exchange risk As at December 31, 2015 and 2014, the Company does not have any material financial instruments in foreign currencies.

134 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

36.6

Fair value The fair value disclosures of financial instruments, considerable judgment is necessarily required in estimation of fair value. Accordingly, the estimated fair value presented herein is not necessarily indicative of the amount that could be realized in a current market exchange. The use of different market assumptions and/or estimation methodologies may have a material effect on the estimated fair value. The following methods and assumptions were used by the Company in estimating fair values of financial instruments. 36.6.1

Financial assets and financial liabilities measured at fair value Certain financial assets and financial liabilities of the Company are measured at fair value at the end of reporting period. The following table gives information about how the fair values of these financial assets and financial liabilities are determined. Unit: Thousand Baht

Financial assets/ Financial liabilities Financial Assets Investment-net Trading securities Listed securities Debt securities Available-for-sale securities Unit trusts Listed securities

FINANCIAL STATEMENTS IN WHICH EQUITY METHOD IS APPLIED AND SEPARATE FINANCIAL STATEMENTS Fair value Fair Valuation techniques and key inputs December 31, December 31, value 2015 2014 hierarchy

5,568

6,051

326,154

683,152

1,218

97,304

38,964

168,193

135 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

Latest bid prices of the last working day of the reporting period as quoted on the Stock Exchange of Thailand Yield rates of the last working day of the reporting period as quoted by the Thai Bond Market Association Net asset values of the last working day of the reporting period Latest bid prices of the last working day of the reporting period as quoted on the Stock Exchange of Thailand

36.6.2

Financial assets and financial liabilities not measured at fair value Fair value of financial assets and financial liabilities which are not measured at fair value and their fair value hierarchy level classification is summarized as follows: Unit: Thousand Baht Financial assets/ Financial liabilities

FINANCIAL STATEMENT IN WHICH EQUITY METHOD IS APPLIED As at December 31, 2015 Carrying Fair Value Amount

Fair value hierarchy

Financial assets Cash and cash equivalents

1,385,441

Deposits at financial institutions

69,310

Receivable from Clearing House

46,596

1,243,874

339

20,499

20,891

Payables to Clearing House

235,433

Securities business payables

674,374

Securities and derivatives business receivables - net General Investment Unit trusts Listed securities Financial liabilities

136 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

Unit: Thousand Baht Financial assets/ Financial liabilities

FINANCIAL STATEMENT IN WHICH EQUITY METHOD IS APPLIED As at December 31, 2014 Carrying Fair Value Amount

Fair value hierarchy

Financial assets Cash and cash equivalents

1,144,608

Deposits at financial institutions

269,310

Receivable from Clearing House

32,190

2,304,224

408

20,499

23,418

Payables to Clearing House

187,680

Securities business payables

1,846,214

3,111

Securities and derivatives business receivables - net General Investment Unit trusts Listed securities Financial liabilities

Payables under finance leases

Unit: Thousand Baht Financial assets/ Financial liabilities

SEPARATE FINANCIAL STATEMENT As at December 31, 2015 Carrying Fair Value Amount

Fair value hierarchy

Financial assets Cash and cash equivalents

1,385,441

Deposits at financial institutions

69,310

Receivable from Clearing House

46,596

1,243,874

339

20,499

20,891

Payables to Clearing House

235,433

Securities business payables

674,374

Securities and derivatives business receivables - net General Investment Unit trusts Listed securities Financial liabilities

137 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

Unit: Thousand Baht Financial assets/ Financial liabilities

SEPARATE FINANCIAL STATEMENT As at December 31, 2014 Carrying Fair Value Amount

Fair value hierarchy

Financial assets Cash and cash equivalents

1,144,608

Deposits at financial institutions

269,310

Receivable from Clearing House

32,190

2,304,224

408

20,499

23,418

Payables to Clearing House

187,680

Securities business payables

1,846,214

3,111

Securities and derivatives business receivables - net General Investment Unit trusts Listed securities Financial liabilities

Payables under finance leases

The fair values of the financial assets and financial liabilities above are considered to approximate their respective carrying value since the fair value are predominantly subject to market interest rate and mature in the short-term except general investment in equity securities which use net asset value of invested company.

37.

APPROVAL OF FINANCIAL STATEMENTS The financial statements for the year ended December 31, 2015 have been approved for issuing by the authorized directors of the Company on February 25, 2016

138 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

The Company’s branch offices The Company’s branches as of December 31, December 2015 are as follows : Branch offices Head Office

Address 132 (Sindhorn Tower 1) level 2, 3 and 9 Wireless Rd., Lumpini, Pathumwan, Bangkok 10330

Lardprao

1693 Central Plaza Building (Lardprao) 11th Floor, Paholyothin Rd., Ladyao, Chatuchak, Bangkok 10900

Bangkae

275 The Mall Building (Bangkae) 6th Floor, Petkasem Rd., North Bangkae, Bangkae, Bangkok 10160

Ngamwongwan

30/39-50 The Mall Building (Ngamwongwan) 12th Floor, Ngamwongwan Rd., Bangkhen, Muang, Nonthaburi 11000

Samrong 1 Samrong 2

1293 Carrefour Building (Samrong) 2nd Floor, Moo 4 Sukhumvit Rd., Theparak, Muang, Samutprakarn 10270

Pinklao

7/129-221 Room No. 2601, Central Pinklao Department Store, 6th Floor, Boromrajachonnanee Road, Arunamarin, Bangkoknoi, Bangkok 10700

Silom

191 Room C, Silom Complex Building 19th Floor, Silom Rd., Bangrak, Silom, Bangkok 10500

Bangna

1093/73 Central City Tower 14th floor, Bangna-Trad Rd., Bangna-Trad, Bangna, Bangkok 10260

Chaengwattana

99, 99/9 Moo 2 Chaengwattana Rd., Bangtalard, Pakkred, Nonthaburi

Chiang Rai 1 Chiang Rai 2

591/5-7 Phaholyothin Road, Wiang, Muang, Chiang Rai 57000

Nakhonsawan

919/112 Moo10 Nakhonsawan Tok, Muang Nakhonsawan, Nakhonsawan 60000

Phayao

3/5 Chaikaw Rd., Viang, Muang, Phayao 56000

Chiang Mai1 and Chiang Mai 2 Jed Yod 1 and Jed Yod 2

2/9-10 Nakornping Condominium 1st floor, Chang Phuek, Muang Chiang Mai, Chiang Mai 50300

Lampoon

12/5 Mukda Rd., Nai Muang, Muang, Lampoon 51000

139 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

Branch offices

Address

Chuladis Hat Yai

200 Chuladis Hat Yai Plaza Shopping Complex, 4th Floor, Nipatuthit 3 Rd., Hat Yai, Songkhla 90110

Nakhon Si Thammarat 1 Nakhon Si Thammarat 2

62, 64, 66,68 Soi Wandeekositkhullaporn, Pattanakarnkukwang, Nai Muang, Muang, Nakhon Si Thammarat 80000

Trang

59/5-7 Huaiyod Rd., Tubtieng, Muang, Trang 92000

Songkla

467 Saiburi Road, Bo Yang, Muang, Songkla 90000

Chumporn 8

1/9 Taweesinka Road, Tatapao, Muang, Chumporn 86000

Surin

7/8 Sirirath road, Nai Muang, Muang, Surin 32000

Sisaket

1036, 1036/1-4 Wanlooksue Road, Muangtai, Muang, Sisaket 33000

Khonkaen

238/8 Ozone village Room 17-19, 2nd floor, Theparak Raod, Nai Muang, Muang, Khonkaen 4000

Nakornratchasima

166/1-2 Chompol Rd., Nai Muang, Muang, Nakornratchasima 30000

Ubon Ratchathani

512/8 Chayangkul Rd., Nai Muang, Muang, Ubon Ratchathani 34000

Buriram

8/47-48 Palad Muang Rd., Nai Muang, Muang, Buriram 31000

Petchaburi

555 Moo 1 Petkasem Rd., Raisom, Muang, Petchaburi 76000

Nakhonpathom

99 Pipitprasart Rd., Pra Pathom Jedi, Muang Nakhonpathom , Nakhonpathom 73000

Kanchanaburi

277/2 Sangchuto Rd., Bannua, Muang, Kanchanaburi 71000

Saraburi

591/19 Paholyothin Rd., Pakprew, Muang , Saraburi 18000

140 Annual Report 2015 COUNTRY GROUP SECURITIES PCL

Branch offices

Address

Rayong

115 Star Plaza Building, 1st Floor, Soi Soonkankasai 5, Sukhumvit Rd., Cheong-nern, Muang, Rayong 21000

Pattaya

3/222 Moo 6, Chalermprakiat Rd., Nakuae, Banglamung, Chonburi 20150

Chaichana Chonburi

838/1A-838/1B Chaichana Rd., Bang Pla Soi, Muang, Chonburi 20000

Banpong Ratchaburi

99/49-50 Songpol Rd., Banpong, Banpong, Ratchaburi 70110

Chachoengsao

1495-1497 1 Floor, Thep-Kunakorn Rd., Na Muang, Muang Chachoengsao 24000

Park Ventures

57 Park Ventures Building Ecoplex Room No 1607B â&#x20AC;&#x201C; 1608,16th Floor, Wireless Rd., Lumpini, Pathumwan, Bangkok 10330

Empire

195 Empire Tower Room 1406,14th tower 3 South Sathorn Rd., Yanawa, Sathorn, Bangkok 10210

Phetchaburi Tat Mai

2884 Manoopol Tower1,6th floor Phetchaburi Tat Mai Rd., Bang Kapi, Huai Khwang , Bangkok 10310

141 Annual Report 2015 COUNTRY GROUP SECURITIES PCL