1. Blue Chip Securities
1. Stock in a well-known and highly respected publicly-traded company. Blue chip
companies are usually financially sound and are thought to be relatively low-risk
investments. They tend to be less volatile than other companies and to provide
solid growth to portfolios. Examples in the United States include General Electric
and Coca-Cola. Indices such as the Dow Jones Industrial Average tracks blue
chip stocks.
2. A very high quality investment involving a lower-than-average risk of loss of
principal or reduction in income. The term is generally used to refer to securities
of companies having a long history of sustained earnings and dividend
payments.
List of Blue Chip Securities Companies
1. Pakistan State Oil
2. Fatima Fertilizer
3. Fauji fertilizer
4. Pakistan Telecom Communication
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2. CRITERIA for SSE, MSE & ESE according to ICAP
Qualifying Entities
Entities which qualify to use this standard as framework for preparation of their financial
statements are defined hereunder. Compliance with MSE Framework and Standard is
necessary for an MSE in order to give a ‘true and fair view’ while preparing its financial
statements.
MEDIUM-SIZED ENTITY (MSE)
A Medium-Sized Entity (MSE) is an entity that:
(a) is not a listed company or a subsidiary of a listed company;
(b) Has not filed, or is not in the process of filing, its financial statements with the
Securities and Exchange Commission of Pakistan (SECP) or other regulatory
organization for the purpose of issuing any class of instruments in a public market;
(c) does not hold assets in a fiduciary capacity for a broad group of outsiders, such as a
bank, insurance company, securities broker/dealer, pension fund, mutual fund or
investment banking entity;
(d) is not a public utility or similar entity that provides an essential public service;
(e) is not economically significant on the basis of criteria as defined in paragraph 3
below; and
(f) is not a Small-Sized Entity (SSE) as defined in paragraph 4 below.
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3. Economically Significant Entity
An entity is considered to be economically significant if it has:
(i) Turnover in excess of Rs. 1 billion, excluding other income;
(ii) Number of employees in excess of 750;
(iii) Total borrowings (excluding trade creditors and accrued liabilities) in excess of Rs.
500 million.
In order to be treated as economically significant any two of the criterion mentioned in
(i), (ii) and (iii) above have to be met. The criteria followed will be based on the previous
year’s audited financial statements. Entities can be delisted from this category where
they do not fall under the aforementioned criteria for two consecutive years.
SMALL-SIZED ENTITY (SSE)
A Small-Sized Entity (SSE) is an entity that:
(i) Has paid up capital plus undistributed reserves (total equity after taking into account
any dividend proposed for the year) not exceeding Rs. 25 million; and
(ii) Has annual turnover not exceeding Rs. 200 million, excluding other income. In order
to qualify as a Small-Sized Entity, both of the above-mentioned conditions must be
satisfied.
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4. PAKISTAN
According to Securitas And Exchange Commission of Pakistan SME means an entity,
ideally not a public limited company, which does not employ more than 250 persons (if it
is manufacturing /service concern) and 50 persons (if it is trading concern) and also
fulfills the following criteria of either ‘a’ and ‘c’ or ‘b’ and ‘c’ as relevant:
(a) A trading/service concern with total assets at cost excluding land and building
up to Rs 50 million.
(b) A manufacturing concern with total assets at cost excluding land and building
Up to Rs 100 million.
(c) Any concern (trading, service or manufacturing) with net sales not exceeding
Rs 300 million as per latest financial statements.
Europe
EU Member States traditionally have had individual definitions of what constitutes an
SME. For example, the traditional definition in Germany had a limit of 255 employees,
while, for example, in Belgium it could have been 100.
In July 2011, the European Commission said that it would open a consultation on the
definition of SMEs in 2012. In Europe, currently there are three broad parameters which
define SMEs — micro-entities are companies with up to 10 employees; small
companies employ up to 50 workers, whilst medium-sized enterprises contain up to 250
employees.
United States
In the United States, the Small Business Administration sets small business criteria
based on industry, ownership structure, revenue, and number of employees, which in
some circumstances may be as high as 1500 though is typically capped at 500.
Both the US and the EU generally use the same threshold of fewer than 10 employees
for small offices (SOHO).
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