“Gradus” AD presents to the public a summary report on the purchases and sales of main grains in the subsidiary company “Gradus-3” AD. The report aims to provide an analysis of the average purchase and sale prices of the company and those of the person Svetoslav Ilchovski.
It should be notes that the prices have been affected by a number of factors, such as:
⦁ Remoteness of our base and of the supplier’s base;
⦁ Time period of concluding the transaction;
⦁ Existence and amount of an advance payment under the transaction;
⦁ Quality of the delivered crops;
Analysis of Purchases
In 2017 the following crops were purchased from Mr. Ilchovski: sunflower, wheat, and corn. There is no deviation from the average prices as regards wheat and corn. As for the sunflower, there was an insignificant difference of 3% in favor of “Gradus-3” AD, as this difference was the result of the following factors:
1. In 2017 “Gradus-3” AD paid approximately 30% in advance of the purchases from Mr. Ilchovski;
2. Lower quality of a part of the delivered production;
3. Delivery of a part of the goods at the expense of the buyer;
In 2018 corn was purchased from him. The deviation in the average price was once again approximately 3%, but in favor of the person Ilchovski this time.
In 2019 corn and wheat were purchases with a deviation of 3% once again in favor of the person Ilchovski, while as regards sunflower this difference was 5% to the opposite. Fluctuations were natural and were entirely a function of market factors.
In 2020 corn was purchased without any deviation from the average price.
In the period 01.01-30.04.2021 no deals were entered with the said person.
Analysis of Sales
Sunflower BGN 1 962 985, or 0.8 % of the consolidated sales of “Gradus“ AD
In 2017 Ilchovski also made purchases from “Gradus 3”, but mostly wheat and limited quantities of sunflower. On 24.10.2017 “Gradus 3” sold to ET “Svetoslav Ilchovski” 3 633 305 tons of sunflower at a price of BGN 540, exclusive of VAT, per ton, or BGN 1 961 984.70, exclusive of VAT, for the entire quantity of sunflower. With this transaction “Gradus 3” sold a quantity of sunflower initially intended for its contractor, with which it had a long-term Forward Contract for the supply of sunflower at a price of BGN 660 per ton, exclusive of VAT. Due to default of the buyer under the contract in question, after “Gradus 3” had already provided the pre-ordered quantities, “Gradus 3” had to quickly find a buyer in order to realize it, even though at a loss (in this case at a price of BGN 540 per ton, exclusive of VAT, under the deal with Ilchovski).
Subsequently, in view of the permanent and at that time good trade relations established between “Gradus 3” and “Svetoslav Ilchovski” ET , “Gradus 3” continued to buy up additional quantities of sunflower at a price of BGN 640, exclusive of VAT, per ton. Due to the ongoing commitment of “Gradus 3” to buy up
large quantities of sunflower and an agreement reached by the parties for the equalization of the purchase prices and the sale price of these single transaction, and that was for a limited quantity in view of the turnover between the parties. These counter operations resulted in neither party making any profit or any loss. Effective payments in full o the price due were made under counter deliveries on 12. 12 .2017, respectively 13.12.2017. Unlike Mr. Ilchovski, “Gradus” AD provided to the regulatory authorities the full package of accounting documents, including invoices, protocols of acceptance and delivery for accepting and delivering the goods, credit notes for adjustment of the price of delivered goods and protocols by virtue of Art. 163a, paragraph 2 of the VAT Act, which clearly confuted any allegations of fictitious transactions.
Read the whole summary here.
For more information - Purchases and sales of main grains 2017-2021.
