Note No. 01 Corporate information

Beryl Securities Limited(“the Company”) (CIN: L67120MP1994PLC008882), is a public limited company domiciled in India and incorporated on 20/12/1994 under the provisions of The Companies Act, 1956. Its equity shares are listed on BSE Limited.

The Company is principally engaged in providing finance to any person or persons, companies, firms and others.

The Company obtained permission from the Reserve Bank of India for carrying on the business of NonBanking Financial Institutions on 03/03/1998 vide Regn No. N 03.00040. The Company is presently classified as Non-Systemically Important Non-Deposit taking NBFC (NBFC-ND-NSI)

The registered office of the Company is 133, Kanchan Bagh Colony, Indore (M.P.)-452001.

The company has maintained its books of accounts at 1116, 11^th Floor, Tower Astralis, Supertech Supernova Sector 94, Noida, Gautam Buddha Nagar, Uttar Pradesh-201301

The Company is primarily engaged in the business of financing property loans, Business loans, micro, small and medium enterprises (MSME), and personal loans.

The financial statements of the Company for the year ended March 31, 2026 has been approved in accordance with the resolution of the Board of Directors on 29/05/2026.

Note No. 02Basis of preparation and presentation with Indian Accounting standard (IND AS)

I. Basis of Preparation

The financial statements of the Company have been prepared in accordance with Indian Accounting Standards (Ind AS) as per the Companies (Indian Accounting Standards) Rules, 2015, as amended by the Companies (Indian Accounting Standards) Rules, 2016, notified under the Section 133 of the Companies Act, 2013 (''the Act’) and other relevant provisions of the Companies Act, 2013.

The financial statements have been prepared under the historical cost convention, as modified by the application of fair value measurements required or allowed by relevant Accounting standards and

other relevant provisions of the Companies Act 2013, guidelines issued by the RBI as applicable to a NBFCs and other accounting principles generally accepted in India. Any application guidance/ clarifications / directions issued by RBI or other regulators are implemented as and when they are issued / applicable.

The regulatory disclosures as required by RBI Direction - Reserve Bank of India (Non-Banking Financial Company Financial Statements: Presentation and Disclosures) Directions, 2025 dated November 28, 2025, as amended, issued by RBI are prepared as per the Ind AS Financial statements.

The financial statements have been prepared on going concern basis in accordance with the Ind AS 1. The Management is of the view that the Company shall be able to continue its business for the near future and no material uncertainty exists that may cast significant doubt on the going concern assumption. In making this assessment, the Management has considered a wide range of information relating to present and future conditions, including future projections of profitability, cash flows and capital resources.

Accounting policies have been consistently applied except where a newly issued accounting standard is initially adopted or a revision to an existing accounting standard requires a change in the accounting policy hitherto in use.

The preparation of financial statements requires the use of certain critical accounting estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses and the disclosed amount of contingent liabilities. Areas involving a higher degree of judgement or complexity, or areas where assumptions are significant to the Company are discussed in Note 4 -Significant accounting judgments, estimates and assumptions.

II. Presentation of IND AS Financial Statement

The financial statements of the Company are presented as per Schedule III (Division III) of the Companies Act, 2013 applicable to Non-banking Finance Companies (NBFCs), as notified by the MCA.

The Statement of Cash Flows has been presented as per the requirements of IND AS 7 Statement of Cash Flows.

The Company classifies its assets and liabilities as financial and non-financial and presents them in the order of liquidity. An analysis regarding expected recovery of settlement within 12 months after the reporting date and more than 12 months after the reporting date is presented in notes to the financial statements.

Financial assets and financial liabilities are generally reported on a gross basis except when, there is an unconditional legally enforceable right to offset the recognise amounts without being contingent on a future event and the parties intend to settle on a net basis in the following circumstances:

a) The normal course of business

b) The event of default

c) The event of insolvency or bankruptcy of the Company and/or its counterparties

III. Statement of Compliance

These financial statements have been prepared by the Company in accordance with the Indian Accounting Standards (TND AS’) as notified by Ministry of Corporate Affairs (‘MCA’) under Section 133 of the Companies Act, 2013 (‘Act’) read with the Companies (Indian Accounting Standard) Rules, 2015 as amended by the Companies (Indian Accounting Standards) Amendment Rules, 2016 (as amended), the provisions of the Act (to the extent notified and applicable) and other applicable guidelines issued by the RBI. The financial statements for the year ended 31 March 2026 has been authorised and approved by the Board of Directors in their meeting held on 29/05/2026.

The Guidance Note on Division III - Schedule III to the Companies Act. 2013 issued by the Institute of Chartered Accountants of India (“ICAI”) has been followed in so far as they are not inconsistent with any of these Directions.

The financial statements have been prepared in accordance with the requirements of the information and disclosures mandated by Schedule III to the Act, applicable IND AS, other applicable pronouncements and regulations and Master Direction - Non-Banking Financial Company - Non-Systemically Important Non-Deposit taking Company (Reserve Bank) Directions, 2016 issued by RBI

IV. Historical cost convention

The Financial Statements have been prepared on a historical cost basis, except for the following:

- Certain financial assets and liabilities are measured at fair value.

- Defined benefit plans - plan assets are measured at fair value; and

- Share based payments

V. Functional and Presentation Currency

The Financial Statements are presented in Indian Rupees in Lakhs (INR Lakhs or Rs. In Lakhs) which is also the functional currency of the Company and all values are rounded to the nearest Lakhs, except when otherwise indicated.

Note No. 03Material Accounting Policies

I. Financial instruments

1. Financial Assets:

a) Initial Recognition And Measurement: All financial assets are recognised initially at fair value when the parties become party to the contractual provisions of the financial asset. In case of financial assets which are not recorded at fair value through profit or loss, transaction costs that are directly attributable to the acquisition or issue of the financial assets, are adjusted to the fair value on initial recognition.

b) Subsequent Measurement: The Company classifies its financial assets into various measurement categories. The classification depends on the contractual terms of the financial assets’ cash flows and the Company’s business model for managing financial assets.

Financial Assets Measured At Amortised Cost:

Financial assets are subsequently measured at amortised cost using the effective interest rate (EIR) as per Ind AS 109 ''Financial Instruments’ if these financial assets are held within a business model whose objective is to hold these assets in order to collect contractual cash flows and the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.

Financial Assets Measured At Fair Value Through Other Comprehensive Income (FVOCI):

Financial assets are measured at fair value through other comprehensive income if these financial assets are held within a business model whose objective is achieved by both collecting contractual cash flows that give rise on specified dates to sole payments of principal and interest on the principal amount outstanding and by selling financial assets.

Financial Assets Measured At Fair Value Through Profit Or Loss (FVTPL):

Financial assets are measured at fair value through profit or loss unless it is measured at amortised cost or at fair value through other comprehensive income on initial recognition. The transaction costs directly attributable to the acquisition of financial assets and liabilities at fair value through profit or loss are immediately recognised in profit or loss.

c) Other Equity Investments: All other equity investments are measured at fair value, with value changes recognised in Statement of Profit and Loss, except for those equity investments for which the Company has elected to present the changes in fair value through other comprehensive income (FVOCI). However, the company is not having any investment in equity in during the current and previous year.

2. Financial Liabilities:

a) Initial recognition and measurement: All financial liabilities are recognized initially at fair value and, in the case of borrowings and payables, net of directly attributable transaction costs. The company’s financial liabilities include trade and other payables.

b) Subsequent Measurement: Financial liabilities other than derivative financial instruments are subsequently carried at amortized cost using the effective interest method.

3. Derecognition of Financial Assets And Liabilities:

a) Financial Asset:

The Company derecognizes a financial asset when the contractual cash flows from the asset expire or it transfers its rights to receive contractual cash flows from the financial asset in a transaction in which substantially all the risks and rewards of ownership are transferred. Any interest in transferred financial assets that is created or retained by the Company is recognized as a separate asset or liability.

b) Financial Liability:

A financial liability is derecognised when the obligation under the liability is discharged, cancelled or expires. Where an existing financial liability is replaced by another from the same lender on substantially different terms, or the terms of an existing liability are substantially modified, such an exchange or modification is treated as de-recognition of the original liability and the recognition of a new liability. The difference between the carrying value of the original financial liability and the consideration paid is recognised in the Statement of profit and loss.

4. Offsetting

Financial assets and financial liabilities are generally reported gross in the balance sheet. Financial assets and liabilities are offset and the net amount is presented in the balance sheet when the Company has a legal right to offset the amounts and intends to settle on a net basis or to realise the asset and settle the liability simultaneously in all the following circumstances:

a. The normal course of business

b. The event of default

c. The event of insolvency or bankruptcy of the Company and/or its counterparties.

5. Impairment of Financial Assets:

In accordance with IND AS 109, the Company uses ''Expected Credit Loss’ model (ECL), for evaluating impairment of financial assets.

Overview of the Expected Credit Loss (ECL) mode:

Expected Credit Loss, at each reporting date, is measured through a loss allowance for a financial asset:

a. At an amount equal to the lifetime expected credit losses if the credit risk on that financial instrument has increased significantly since initial recognition.

b. At an amount equal to 12-month expected credit losses, if the credit risk on a financial instrument has not increased significantly since initial recognition.

Lifetime expected credit losses means expected credit losses that result from all possible default events over the expected life of a financial asset.

12-month expected credit losses means the portion of Lifetime ECL that represent the ECLs that result from default events on financial assets that are possible within the 12 months after the reporting date.

The Company performs an assessment, at the end of each reporting period, of whether a financial assets credit risk has increased significantly since initial recognition. When making the assessment, the change in the risk of a default occurring over the expected life of the financial instrument is used instead of the change in the amount of expected credit losses.

Based on the above process, the Company categorises its loans into three stages as described below:

Stage 1: All exposures where there has not been a significant increase in credit risk since initial recognition or that has low credit risk at the reporting date and that are not credit impaired upon origination are classified under this stage. The Company classifies all standard advances and advances upto 30 days default under this category. Stage 1 loans also include facilities where the credit risk has improved and the loan has been reclassified from Stage 2 or Stage 3.

Stage 2: All exposures where there has been a significant increase in credit risk since initial recognition but are not credit impaired are classified under this stage. 30 Days Past Due is considered as significant increase in credit risk.

Stage 3:

All exposures assessed as credit impaired when one or more events that have a detrimental impact on the estimated future cash flows of that asset have occurred are classified in this stage. For exposures that have become credit impaired, a lifetime ECL is recognised and interest revenue is calculated by applying the effective interest rate to the amortised cost (net of provision) rather than the gross carrying amount. 90 Days Past Due is considered as default for classifying a financial instrument as credit impaired. If an event (for e.g. any natural calamity) warrants a provision higher than as mandated under ECL methodology, the Company may classify the financial asset in Stage 3 accordingly.

In line with Reserve Bank of India Master Circular on Prudential norms on Income Recognition, Asset Classification and Provisioning pertaining to Advances and Clarifications dated November 28, 2025 borrower accounts shall be flagged as overdue as part of the day-end processes for the due date, irrespective of the time of running such processes. Similarly, classification of borrower accounts as Non-Performing Asset / Stage 3 shall be done as part of day-end process for the relevant date i.e. more than 90 days overdue and NPA/Stage 3 classification date shall be the calendar date for which the day end process is run. In other words, the date of Non-Performing Asset / Stage 3 shall reflect the asset classification status of an account at the day-end of that calendar date.

II. Revenue from operations

Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Company and the revenue can be reliably measured and there exists reasonable certainty of its recovery.

Interest Income: Interest income is recognised by applying the Effective Interest Rate (EIR) to the gross carrying amount of financial assets measured at amortised cost other than credit-impaired assets and financial assets classified as measured at FVTPL.

The EIR in case of a financial asset is computed

a. As the rate that exactly discounts estimated future cash receipts through the expected life of the financial asset to the gross carrying amount of a financial asset.

b. By considering all the contractual terms of the financial instrument in estimating the cash flows.

c. Including all fees received between parties to the contract that are an integral part of the effective interest rate, transaction costs, and all other premiums or discounts.

For Credit Impaired financial assets the interest income is calculated by applying the EIR to the amortised cost of the credit-impaired financial assets (i.e. the gross carrying amount less the allowance for expected credit losses (ECLs)) and not recognized in Statement of Profit and loss account.

Interest on delayed payments by customers are treated to accrue only on realisation, due to uncertainty of realisation and are accounted accordingly.

Fees & Commission Income:

Fees and commissions are recognised when the Company satisfies the performance obligation, at the amount of transaction price (net of variable consideration) allocated to that performance obligation based on a five-step model as set out below, unless included in the effective interest calculation:

Step 1: Identify contract(s) with a customer: A contract is defined as an agreement between two or more parties that creates enforceable rights and obligations and sets out the criteria for every contract that must be met.

Step 2: Identify performance obligations in the contract: A performance obligation is a promise in a contract with a customer to transfer a good or service to the customer.

Step 3: Determine the transaction price: The transaction price is the amount of consideration to which the Company expects to be entitled in exchange for transferring promised goods or services to a customer, excluding amounts collected on behalf of third parties.

Step 4: Allocate the transaction price to the performance obligations in the contract: For a contract that has more than one performance obligation, the Company allocates the transaction price to each performance obligation in an amount that depicts the amount of consideration to which the Company expects to be entitled in exchange for satisfying each performance obligation.

Step 5: Recognise revenue when (or as) the Company satisfies a performance obligation.

Other income and expenses

All other income and expense are recognized in the period they occur.

III. Finance Cost/Borrowing Cost

Finance costs represents Interest expense recognised by applying the Effective Interest Rate (EIR) to the gross carrying amount of financial liabilities other than financial liabilities classified as FVTPL.

The EIR in case of a financial liability is computed

a. As the rate that exactly discounts estimated future cash payments through the expected life of the financial liability to the gross carrying amount of the amortised cost of a financial liability.

b. By considering all the contractual terms of the financial instrument in estimating the cash flows.

c. Including all fees paid between parties to the contract that are an integral part of the effective interest rate, transaction costs, and all other premiums or discounts.

Any subsequent changes in the estimation of the future cash flows is recognised in interest expense with the corresponding adjustment to the carrying amount of the financial liability.

Interest expense includes issue costs that are initially recognised as part of the carrying value of the financial liability and amortised over the expected life using the effective interest method. These include fees and commissions payable to advisers and other expenses such as external legal costs, rating fee etc, provided these are incremental costs that are directly related to the issue of a financial liability.

IV. Employee Benefits

Short Term Employee Benefit:

All employee benefits payable wholly within twelve months of rendering the service are classified as short-term employee benefits. These benefits include short term compensated absences such as paid annual leave. The undiscounted amount of short-term employee benefits expected to be paid in exchange for the services rendered by employees is recognised as an expense during the period. Benefits such as salaries and wages, etc. and the expected cost of the bonus/ex-gratia are recognised in the period in which the employee renders the related service.

Post-employment employee benefits a) Defined contribution plans:

Post-retirement contribution plans such as Employees’ Pension Scheme, Labour Welfare Fund, Employee State Insurance Corporation (ESIC) are charged to the profit or loss for the year when the contributions to the respective funds accrue. The Company does not have any obligation other than the contribution made.

b) Defined Benefits Plans:

Employees'' provident fund:

Provident Fund contributions are made to a trust administered by the Trustees. Trust makes investments and settles member''s claims. Interest Payable to the members shall not be at a rate lower than the statutory rate. Liability is recognized for any shortfall in the plan assets vis-a-vis actuarially determined liability of the fund obligation.

Gratuity Plan:

No provision has been made in accounts against liability in respect of future payment of Gratuity and Leave Encashment to employee as in the opinion of the management neither the Gratuity nor Leave Encashment apply to the company nor any employee qualifies for entitlement of such benefits.

c) Termination benefits:

Termination benefits are recognized as an expense when the Company is committed without any possibility of withdrawal of an offer made to either terminate employment before the normal retirement date or as a result of an offer made to encourage voluntary retirement.

V. Leases

The Company as a lessee

The Company has adopted Ind AS 116 ‘Leases’. The determination of whether an arrangement is a lease, or contains a lease, is based on the substance of the arrangement and requires an assessment of whether the fulfilment of the arrangement is dependent on the use of a specific asset or assets or

whether the arrangement conveys a right to use the asset. A contract is, or contains, a lease if the contract conveys the right to control the use of an identified asset for a time in exchange for a consideration. The Company, at the inception of a contract, assesses whether the contract is a lease or not lease.

The Company recognises a right-of-use asset and a lease liability at the lease commencement date. The right-of-use asset is initially measured at cost, which comprises the initial amount of the lease liability adjusted for any lease payments made at or before the commencement date, plus any initial direct costs incurred and an estimate of costs to dismantle and remove the underlying asset or to restore the underlying asset or the site on which it is located, less any lease incentives received. The right-of-use asset is subsequently depreciated using the straight-line method from the commencement date to the end of the lease term.

The lease liability is initially measured at the present value of the lease payments that are not paid at the commencement date, discounted using the Company’s incremental borrowing rate at the transition date in case of leases existing as on the date of transition date and in case of leases entered after transition date, incremental borrowing rate as on the date of lease commencement date. In case of existing leases, the said date would be the date of transition. It is remeasured when there is a change in future lease payments arising from a change in a rate, if the Company changes it assessment of whether it will exercise an extension or termination option.

When the lease liability is remeasured in this way, a corresponding adjustment is made to the carrying amount of the rightof- use asset, or is recorded in Statement of Profit and Loss if the carrying amount of the right-of-use asset has been reduced to zero.

The Company has elected not to recognise right-of-use assets and lease liabilities for short-term leases that have a lease term of 12 months or less and leases of low-value assets. The Company recognises the lease payments associated with these leases as an expense over the lease term. The Company’s lease asset class consist of leases for office premises.

VI. Taxes

Current Tax

Current tax assets and liabilities for the current and prior years are measured at the amount expected to be recovered from, or paid to, the taxation authorities. The tax rates and tax laws used to compute the amount are those that are enacted, or substantively enacted, by the reporting date in the countries where the Company operates and generates taxable income.

Current income tax relating to items is recognised outside the statement of profit and loss (either in other comprehensive income or in equity). Management periodically evaluates positions taken in the tax returns with respect to situations in which applicable tax regulations are subject to interpretation and establishes provisions where appropriate.

Deferred Tax

Deferred tax assets and liabilities are recognised for temporary differences arising between the tax bases of assets and liabilities and their carrying amounts. Deferred income tax is determined using tax rates (and laws) that have been enacted or substantively enacted by the reporting date and are expected to apply when the related deferred income tax asset is realised or the deferred income tax liability is settled.

Deferred tax assets are only recognised for temporary differences, if it is probable that future taxable amounts will arise to utilise those temporary differences and losses. Deferred tax assets are reviewed at each reporting date and are reduced to the extent that it is no longer probable that the related tax benefit will be realised.

Deferred tax assets and liabilities are offset where there is a legally enforceable right to offset current tax assets and liabilities and they relate to income taxes levied by the same tax authority on the same taxable entity, or on different tax entities, but they intend to settle current tax liabilities and assets on a net basis or their tax assets and liabilities are realised simultaneously.

Goods And Services Tax Paid On Acquisition Of Assets Or On Incurring Expenses

Expenses and assets are recognised net of the goods and services tax/ value added taxes paid, except:

a. When the tax incurred on a purchase of assets or services is not recoverable from the taxation authority, in which case, the tax paid is recognised as part of the cost of acquisition of the asset or as part of the expense item, as applicable.

b. When receivables and payables are stated with the amount of tax included.

The net amount of tax recoverable from, or payable to, the taxation authority is included as part of receivables or payables in the balance sheet.

VII. Cash and Cash Equivalents

Cash and cash equivalents comprise of cash in hand, Balance with banks and Cheques in hand, which are subject to an insignificant risk of changes in value.

For the purpose of the statement of cash flows, cash and cash equivalents consist of cash in hand, Balance with banks and Cheques in hand as they are considered an integral part of the Company’s cash management.

VIII. Property, Plant And Equipment

Property, plant and equipment (PPE) are carried at historical cost of acquisition less accumulated depreciation. The total cost of assets comprises its purchase price, freight, duties, taxes and any other incidental expenses directly attributable to bringing the asset to the location and condition necessary for it to be capable of operating in the manner intended by the management.

Subsequent expenditure related to an item of tangible asset are added to its gross value only if it increases the future benefits of the existing asset, if it is probable that future economic benefit will flow to the Company from that expenditure and cost can be measured reliably. Other repairs and maintenance costs are expensed off as and when incurred.

Depreciation

Depreciation on Property, Plant and Equipment is calculated using written down value method (WDV) to write down the cost of property and equipment to their residual values over their estimated useful

lives which is in line with the estimated useful life as specified in Schedule II of the Companies Act. 2013 except for Leasehold improvements which are amortised on a straight-line basis over the period of lease or estimated period of useful life of such improvement. Leasehold improvements include all expenditure incurred on the leasehold premises that have future economic benefits.

The residual values, useful lives and methods of depreciation of property, plant and equipment are reviewed at each financial year end and adjusted prospectively, if appropriate.

Property, plant and equipment is derecognised on disposal or when no future economic benefits are expected from its use. Any gain or loss arising on derecognition of the asset (calculated as the difference between the net disposal proceeds and the carrying amount of the asset) is recognised in other income/ expense in the Statement of Profit and Loss in the year the asset is derecognised.

Depreciation on assets acquired/ sold during the year is recognised on a pro-rata basis to the Statement of Profit and Loss from/ upto the date of acquisition/ sale.

The date of disposal of an item of property, plant and equipment is the date the recipient obtains control of that item in accordance with the requirements for determining when a performance obligation is satisfied in Ind AS 115.

IX. Intangible Assets

There is no Intangible Assets in the company.

X. Provisions. Contingent Liabilities & Contingent asset

1. Provisions are recognised only when:

(i) the Company has a present obligation (legal or constructive) as a result of a past event; and

(ii) it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation; and

(iii) a reliable estimate can be made of the amount of the obligation

When the effect of the time value of money is material, the enterprise determines the level of provision by discounting the expected cash flows at a pre-tax rate reflecting the current rates specific to the liability. The expense relating to any provision is presented in the Statement of Profit and Loss net of any reimbursement.

2. Contingent Liabilities: Contingent liability is disclosed in case of:

(i) a present obligation arising from past events, when it is not probable that an outflow of resources will be required to settle the obligation; and

(ii) a present obligation arising from past events, when no reliable estimate is possible.

3. Contingent assets are disclosed where an inflow of economic benefits is probable. Provisions, contingent liabilities and contingent assets are reviewed at each Balance Sheet date. Where the unavoidable costs of meeting the obligations under the contract exceed the economic benefits expected to be received under such contract, the present obligation under the contract is recognised and measured as a provision.

XI. Earnings Per Share

The Company reports basic and diluted earnings per share in accordance with Ind AS 33 on Earnings per share.

Basic EPS is calculated by dividing the net profit or loss for the year attributable to equity shareholders by the weighted average number of equity shares outstanding during the year.

For calculating diluted earnings per share, the net profit or loss for the year attributable to equity shareholders and the weighted average number of shares outstanding during the year are adjusted for the effects of all dilutive potential equity shares. Dilutive potential equity shares are deemed converted as of the beginning of the period, unless they have been issued at a later date. In computing the dilutive earnings per share, only potential equity shares that are dilutive and that either reduces the earnings per share or increases loss per share are included.

XII. Effective interest rate method

The Company recognises interest income/expense using the effective interest rate, i.e., a rate that represents the best estimate of a constant rate of return over the expected life of the loans. The effective interest method also accounts for the effect of potentially different interest rates at various stages and other characteristics of the product life cycle (including prepayments and penalty interest and charges).

This estimation, by nature, requires an element of judgement regarding the expected behavior and lifecycle of the instruments, as well expected changes to India’s base rate and other fee income/expense that are integral parts of the instrument.

XIII. Impairment of financial assets using the expected credit loss method

The impairment provisions for financial assets are based on assumptions about risk of default and expected loss rates. The Company uses judgement in making these assumptions and selecting the inputs to the impairment calculation, based on the Company’s history, existing market conditions as well as forward looking estimates at the end of each reporting period.

XIV. Impairment of Non-Financial Assets

At each reporting date, the Company reviews the carrying amounts of its non-financial assets (other than deferred tax assets) to determine whether there is any indication of impairment. If any such indication exists, the asset''s recoverable amount is estimated.

XV. Recognition of NPA

a) All credit exposures are classified into performing and non-performing assets as per the RBI guidelines. Further, NPAs are classified into Sub-Standard, Doubtful & Loss Assets based on the criteria stipulated by RBI. Provisions are made on Standard, Sub-Standard and Doubtful Assets at the rates prescribed by RBI. Loss Assets & Unsecured portion of Doubtful Assets are provided/ written off as per the RBI guidelines. Additional provisions are made against specific non-performing assets over and above what is stated above, if in the opinion of the management, increased provisions are necessary. The Company has duly complied with the prudential norms relating to income recognition, asset classification and provisioning for bad and doubtful debts as applicable to it.

b) NPA Provision has been written back of those accounts whose recovery is affected during the year.

XVI. Segment Reporting:

The Company is engaged in the sole segment of NBFC Activity. Therefore, no separate segments within the Company as defined by IND AS-108(Operating Segments)

Note No. 04Accounting Judgments, Estimates and Assumptions

The preparation of financial statements in conformity with the IND AS requires the management to make judgments, estimates and assumptions that affect the reported amounts of revenues, expenses, assets and liabilities and the accompanying disclosure and the disclosure of contingent liabilities, at the end of the reporting period. Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimates are revised and future periods are affected. Although these estimates are based on the management’s best knowledge of current events and actions, uncertainty about these assumptions and estimates could result in the outcomes requiring a material adjustment to the carrying amounts of assets or liabilities in future periods.

In particular, information about significant areas of estimation, uncertainty and critical judgments in applying accounting policies that have the most significant effect on the amounts recognised in the financial statements is included in the following notes:

I. Business Model Assessment

Classification and measurement of financial assets depends on the results of the SPPI and the business model test. The Company determines the business model at a level that reflects how groups of financial assets are managed together to achieve a particular business objective. This assessment includes judgement reflecting all relevant evidence including how the performance of the assets is evaluated and

their performance measured, the risks that affect the performance of the assets and how these are managed and how the managers of the assets are compensated. The Company monitors financial assets measured at amortised cost or fair value through other comprehensive income that are derecognised prior to their maturity to understand the reason for their disposal and whether the reasons are consistent with the objective of the business for which the asset was held. Monitoring is part of the Company’s continuous assessment of whether the business model for which the remaining financial assets are held continues to be appropriate and if it is not appropriate whether there has been a change in business model and so a prospective change to the classification of those assets.

II. Fair value measurement

When the fair values of financial assets and financial liabilities recorded in the balance sheet cannot be measured based on quoted prices in active markets, their fair value is measured using various valuation techniques. The inputs to these models are taken from observable markets where possible, but where this is not feasible, a degree of judgment is required in establishing fair values. Judgments include considerations of inputs such as liquidity risk, credit risk and volatility. Changes in assumptions about these factors could affect the reported fair value of financial instruments.

III. Impairment of loans portfolio

The measurement of impairment losses across all categories of financial assets requires judgement, in particular, the estimation of the amount and timing of future cash flows and collateral values when determining impairment losses and the assessment of a significant increase in credit risk. These estimates are driven by a number of factors, changes in which can result in different levels of allowances. It has been the Company’s policy to regularly review its models in the context of actual loss experience and adjust when necessary.

In line with Reserve Bank of India Master Circular on Prudential norms on Income Recognition, Asset Classification and Provisioning pertaining to Advances and Clarifications dated April 01, 2023 borrower accounts shall be flagged as overdue as part of the day-end processes for the due date, irrespective of the time of running such processes. Similarly, classification of borrower accounts as Non-Performing Asset / Stage 3 shall be done as part of day-end process for the relevant date i.e. more than 90 days overdue and NPA/Stage 3 classification date shall be the calendar date for which the day end process is run. In other words, the date of Non-Performing Asset / Stage 3 shall reflect the asset classification status of an account at the day-end of that calendar date.

The Company has carried out the requirement in line with Reserve Bank of India Clarification and accordingly the change in accounting policy is effective financial year 2023-24.

IV. Contingent liabilities and provisions other than impairment on loan portfolio

Provisions and liabilities are recognised in the period when it becomes probable that there will be a future outflow of funds resulting from past operations or events and the amount of cash outflow can be reliably estimated. The timing of recognition and quantification of the liability requires the application of judgement to existing facts and circumstances, which can be subject to change. The carrying amounts of provisions and liabilities are reviewed at each Balance sheet date and revised to take account of changing facts and circumstances.

V. Effective Interest Rate (EIR) method

The Company’s EIR methodology, recognises interest income/expense using a rate of return that represents the best estimate of a constant rate of return over the expected behavioral life of loans given / taken and recognises the effect of potentially different interest rates at various stages and other characteristics of the product life cycle (including prepayments and penalty interest and charges). This estimation, by nature, requires an element of judgement regarding the expected behavior and life-cycle of the instruments, as well expected changes to India’s base rate and other fee income/expense that are integral parts of the instrument.

Material Accounting Policies

I. Financial instruments

1. Financial Assets:

a) Initial Recognition and Measurement: All financial assets are recognised initially at fair value
when the parties become party to the contractual provisions of the financial asset. In case of
financial assets which are not recorded at fair value through profit or loss, transaction costs that are
directly attributable to the acquisition or issue of the financial assets, are adjusted to the fair value on
initial recognition.

b) Subsequent Measurement: The Company classifies its financial assets into various
measurement categories. The classification depends on the contractual terms of the financial
assets’ cash flows and the Company’s business model for managing financial assets.

Financial Assets Measured At Amortised Cost:

A financial asset is measured at Amortised Cost if it is held within a business model whose objective
is to hold the asset in order to collect contractual cash flows and the contractual terms of the
Financial Asset give rise on specified dates to cash flows that are solely payments of principal and
interest on the principal amount outstanding.

Financial Assets Measured At Fair Value Through Other Comprehensive Income (FVOCI):

A financial asset is measured at FVOCI if it is held within a business model whose objective is
achieved by both collecting contractual cash flows and selling financial assets and contractual
terms of financial asset give rise on specified dates to cash flows that are solely payments of
principal and interest on the principal amount outstanding.

Financial Assets Measured At Fair Value Through Profit Or Loss (FVTPL):

A financial asset which is not classified in any of the above categories are measured at FVTPL.
c) Other Equity Investments: All other equity investments are measured at fair value, with value
changes recognised in Statement of Profit and Loss, except for those equity investments for which
the Company has elected to present the changes in fair value through other comprehensive income
(FVOCI).

2. Financial Liabilities:

a) Initial recognition and measurement: All financial liabilities are recognized initially at fair value
and, in the case of borrowings and payables, net of directly attributable transaction costs. The
company’s financial liabilities include trade and other payables.

b) Subsequent Measurement: Financial liabilities other than derivative financial instruments are
subsequently carried at amortized cost using the effective interest method.

3. Derecognition of Financial Assets And Liabilities:

a) Financial Asset:

The Company derecognizes a financial asset when the contractual cash flows from the asset expire or it
transfers its rights to receive contractual cash flows from the financial asset in a transaction in which
substantially all the risks and rewards of ownership are transferred. Any interest in transferred financial
assets that is created or retained by the Company is recognized as a separate asset or liability.

b) Financial Liability:

A financial liability is derecognised when the obligation under the liability is discharged, cancelled or
expires. Where an existing financial liability is replaced by another from the same lender on substantially
different terms, or the terms of an existing liability are substantially modified, such an exchange or
modification is treated as de-recognition of the original liability and the recognition of a new liability. The
difference between the carrying value of the original financial liability and the consideration paid is
recognised in the Statement of profit and loss.

4. Offsetting

Financial assets and financial liabilities are generally reported gross in the balance sheet. Financial
assets and liabilities are offset and the net amount is presented in the balance sheet when the Company
has a legal right to offset the amounts and intends to settle on a net basis or to realise the asset and settle
the liability simultaneously in all the following circumstances:

a. The normal course of business

b. The event of default

c. The event of insolvency or bankruptcy of the Company and/or its counterparties.

5. Impairment of Financial Assets:

In accordance with IND AS 109, the Company uses ‘Expected Credit Loss’ model (ECL), for evaluating
impairment of financial assets other than those measured at Fair value through profit or loss.

Overview of the Expected Credit Loss (ECL) mode:

Expected Credit Loss, at each reporting date, is measured through a loss allowance for a financial asset:

a. At an amount equal to the lifetime expected credit losses if the credit risk on that financial instrument
has increased significantly since initial recognition.

b. At an amount equal to 12-month expected credit losses, if the credit risk on a financial instrument
has not increased significantly since initial recognition.

Lifetime expected credit losses means expected credit losses that result from all possible default events
over the expected life of a financial asset.

12-month expected credit losses means the portion of Lifetime ECL that represent the ECLs that result
from default events on financial assets that are possible within the 12 months after the reporting date.

The Company performs an assessment, at the end of each reporting period, of whether a financial assets
credit risk has increased significantly since initial recognition. When making the assessment, the change
in the risk of a default occurring over the expected life of the financial instrument is used instead of the
change in the amount of expected credit losses.

Based on the above process, the Company categorises its loans into three stages as described below:
Stage 1 : All exposures where there has not been a significant increase in credit risk since initial
recognition or that has low credit risk at the reporting date and that are not credit impaired upon origination
are classified under this stage. The Company classifies all standard advances and advances upto 30
days default under this category. Stage 1 loans also include facilities where the credit risk has improved
and the loan has been reclassified from Stage 2 or Stage 3.

Stage 2: All exposures where there has been a significant increase in credit risk since initial recognition
but are not credit impaired are classified under this stage. 30 Days Past Due is considered as significant
increase in credit risk.

Stage 3: All exposures assessed as credit impaired when one or more events that have a detrimental
impact on the estimated future cash flows of that asset have occurred are classified in this stage. For
exposures that have become credit impaired, a lifetime ECL is recognised and interest revenue is
calculated by applying the effective interest rate to the amortised cost (net of provision) rather than the
gross carrying amount. 90 Days Past Due is considered as default for classifying a financial instrument as
credit impaired. If an event (for e.g. any natural calamity) warrants a provision higher than as mandated
under ECL methodology, the Company may classify the financial asset in Stage 3 accordingly.

In line with Reserve Bank of India Master Circular on Prudential norms on Income Recognition, Asset
Classification and Provisioning pertaining to Advances and Clarifications dated April 01,2023 borrower
accounts shall be flagged as overdue as part of the day-end processes for the due date, irrespective of the
time of running such processes. Similarly, classification of borrower accounts as Non-Performing Asset /
Stage 3 shall be done as part of day-end process for the relevant date i.e. more than 90 days overdue and
NPA/Stage 3 classification date shall be the calendar date for which the day end process is run. In other
words, the date of Non-Performing Asset / Stage 3 shall reflect the asset classification status of an
account at the day-end of that calendar date.

The Company has carried out the requirement in line with Reserve Bank of India Clarification and
accordingly the change in accounting policy is effective financial year 2023-24

II. Revenue from operations

Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Company
and the revenue can be reliably measured and there exists reasonable certainty of its recovery.

Interest Income: The interest income is calculated by applying the EIR to the gross carrying amount of
non-credit impaired financial assets (i.e. at the amortised cost of the financial asset before adjusting for
any expected credit loss allowance).

For Credit Impaired financial assets the interest income is calculated by applying the EIR to the amortised
cost of the credit-impaired financial assets (i.e. the gross carrying amount less the allowance for expected
credit losses (ECLs)) and not recognized in Statement of Profit and loss account rather it is credited in a
separate ledger "Unrealized Interest On NPAAccounts” under the "Other Financial Liabilities” head.

III. Employee Benefits

Short Term Employee Benefit:

All employee benefits payable wholly within twelve months of rendering the service are classified as
short-term employee benefits. These benefits include short term compensated absences such as paid

annual leave. The undiscounted amount of short-term employee benefits expected to be paid in
exchange for the services rendered by employees is recognised as an expense during the period.
Benefits such as salaries and wages, etc. and the expected cost of the bonus/ex-gratia are recognised in
the period in which the employee renders the related service.

Post-employment employee benefits

No provision has been made in accounts against liability in respect of future payment of Gratuity, Leave
Encashment, ESI and Provident Fund to employee as in the opinion of the management neither the
Gratuity, ESI nor Provident Fund apply to the company nor any employee qualifies for entitlement of such
benefits.

IV. Other income and expenses

All other income and expense are recognised in the period they occur.

V. Taxes
Current Tax

Current tax assets and liabilities for the current and prior years are measured at the amount expected to
be recovered from, or paid to, the taxation authorities. The tax rates and tax laws used to compute the
amount are those that are enacted, or substantively enacted, by the reporting date in the countries where
the Company operates and generates taxable income. Current income tax relating to items is recognised
outside the statement of profit and loss (either in other comprehensive income or in equity). Management
periodically evaluates positions taken in the tax returns with respect to situations in which applicable tax
regulations are subject to interpretation and establishes provisions where appropriate.

Deferred Tax

Deferred tax assets and liabilities are recognised for temporary differences arising between the tax bases
of assets and liabilities and their carrying amounts. Deferred income tax is determined using tax rates
(and laws) that have been enacted or substantively enacted by the reporting date and are expected to
apply when the related deferred income tax asset is realised or the deferred income tax liability is settled.
Deferred tax assets are only recognised for temporary differences, if it is probable that future taxable
amounts will arise to utilise those temporary differences and losses. Deferred tax assets are reviewed at
each reporting date and are reduced to the extent that it is no longer probable that the related tax benefit
will be realised.

Deferred tax assets and liabilities are offset where there is a legally enforceable right to offset current tax
assets and liabilities and they relate to income taxes levied by the same tax authority on the same taxable
entity, or on different tax entities, but they intend to settle current tax liabilities and assets on a net basis or
their tax assets and liabilities are realised simultaneously.

VI. Cash and Cash Equivalents

Cash and cash equivalents comprise of cash in hand, Balance with banks and Cheques in hand, which
are subject to an insignificant risk of changes in value.

For the purpose of the statement of cash flows, cash and cash equivalents consist of cash in hand,
Balance with banks and Cheques in hand as they are considered an integral part of the Company’s cash
management.

VII. Property, Plant and Equipment

Property, plant and equipment (PPE) are carried at historical cost of acquisition less accumulated
depreciation. The total cost of assets comprises its purchase price, freight, duties, taxes and any other
incidental expenses directly attributable to bringing the asset to the location and condition necessary for it
to be capable of operating in the manner intended by the management.

Subsequent expenditure related to an item of tangible asset are added to its gross value only if it
increases the future benefits of the existing asset, if it is probable that future economic benefit will flow to
the Company from that expenditure and cost can be measured reliably. Other repairs and maintenance
costs are expensed off as and when incurred.

Depreciation on Property, Plant and Equipment is calculated using written down value method (WDV) to
write down the cost of property and equipment to their residual values over their estimated useful lives
which is in line with the estimated useful life as specified in Schedule II of the Companies Act, 2013.

(a) USE OF ESTIMATES

The preparation of financial statement in conformity with generally accepted accounting principles require estimate and assumptions to be made that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities on the date of financial statement and the reported amounts of revenues and expenses during the reporting period, actual results could differ from these estimates and difference between actual results and estimate are recognized in the periods in which the results are known/materialize.

(b) REVENUE RECOGNITION

The company follows the accrual basis of accounting except in the following case where the same are recorded on cash basis on ascertainment of risk and obligation

a. Interest and other dues are recognized on accrual basis except in the case of income on Non-performing Assets (NPAs) which is recognized, as and when received, as per the prudential norms prescribed by the RBI.

b. Dividend declared by the respective companies' up to the close of the accounting period are accounted for as income, once the right to receive is established.

(c) CASH FLOW STATEMENT

The cash flow statement is prepared using the "Indirect method set out in Accounting Standard 3" Cash Flow statement, which presents cash flow from operating, investing and financing activities of the company. Cash and cash equivalent presented in the cash flow statement consists of cash in hand and unencumbered lightly liquid Bank Balance.

(d) FIXED ASSETS

Fixed assets are carried at cost of acquisition or construction (net of CENVAT where applicable). They are carried at historical cost less accumulated depreciation.

(e) DEPRECIATION

Depreciation is charged over the estimated useful life of fixed assets on written down value basis. Depreciation is provided based on useful life of the assets as prescribed in schedule II to the Companies Act ,2013.

(f) INVESTMENT

All Investments which are held for more than one year from date of acquisition are classified as long term investment and are carried at cost.

(g) RETIREMENT BENEFIT

No provision has been made in accounts against liability in respect of future payment of Gratuity, Leave Encashment, ESI, Provident Fund and Bonus to employee as in the opinion of the management neither the Gratuity, ESI, Provident Fund and Bonus Act apply to the company nor any employee qualifies for entitlement of such benefits.

(h) BORROWING COST

Borrowing costs that are attributable to the acquisition or construction of qualifying assets are capitalized as part of the cost of such assets. Borrowing costs relating to working capital are charged to statement profit and loss as expenses, if any, incurred.

(i) EARNINGS PER SHARE

The company reports basic and diluted earning per shares computed in accordance with Accounting Standard- 20 -Earning per share. Basic EPS is calculated by dividing the Net Profit after tax for the year attributable to equity share holders by the weighted Average number of Equity Shares outstanding during the year.

(j) PRIOR PERIOD ITEM

Income and expenditure pertaining to prior period which were omitted to be recorded in last year due to error or omission in books are duly reflected under head of prior period items in the statement of Profit & loss of current year.

(k) TAXATION

1) The Provision for wealth tax and current tax has been provided in accordance with provision of wealth tax Act 1956 and the Income Tax Act, 1961 respectively.

2) Deferred tax assets and liabilities are recognized on a prudent basis for future tax consequences of timing differences arising between the carrying value of assets and liabilities and their respective tax basis, and carried forward losses. It is measured using tax rates and tax laws that have been enacted or substantially enacted at the balance sheet date. The impact of changes in deferred tax assets and liabilities is recognized in the profit and loss account.

3) Minimum Alternative Tax ('MAT') under the provisions of the Income-tax Act, 1961 is recognised as current tax in the Statement of Profit and Loss as per recommendations contained in the guidance notes issued by ICAI, the credit available under the Act in respect of MAT paid is recognised as an asset only when and to the extent there is convincing evidence that the company will pay normal income tax during the period for which the MAT credit can be carried forward for set-off against the normal tax liability. MAT credit recognised as an asset is reviewed at each balance sheet date and written down to the extent the aforesaid convincing evidence no longer exists.

(l) PROVISION AND CONTINGENCIES

Provisions involving substantial degree of estimation in measurement are recognized where there is a Present obligation as a result of past events and it is probable that there will be out flow of resources. Contingent liabilities are not recognized, but are disclosed in the notes of accounts, contingent assets are neither recognized nor disclosed in the financial statement.

(m) CONTINGENCIES AND EVENTS OCCURRING AFTER THE BALANCE SHEET DATE

Accounting for contingencies (gains and losses) arising out of contractual obligations, are made only on the basis of mutual acceptances. Events occurring after the date of the Balance Sheet are considered up to the date of approval of the accounts by the Board, where material.

(n) IMPAIRMENT OF ASSETS

Fixed asset are reviewed for impairment whenever events or changes in circumstances indicates that the carrying amount of assets may not be recoverable. If such assets are considered to be impaired, the impairment is recognized by debiting the Profit & Loss Account and is measured as the amount by which the carrying cost of assets exceeds the fair value of assets. The impairment loss recognized in prior accounting period is reversed, if there has been a change in the estimate of recoverable amount. By virtue of this, Company has carried out comprehensive exercise, to assess the impairment loss of assets based on such exercise.

(o) Provision/ Write Off against Loans and Other Credit Facilities

(a) All credit exposures are classified into performing and non-performing assets as per the RBI guidelines. Further, NPAs are classified into Sub-Standard, Doubtful & Loss Assets based on the criteria stipulated by RBI. Provisions are made on Standard, Sub-Standard and Doubtful Assets at the rates prescribed by RBI. Loss Assets & Unsecured portion of Doubtful Assets are provided/ written off as per the RBI guidelines. Additional provisions are made against specific non-performing assets over and above what is stated above, if in the opinion of the management, increased provisions are necessary.

(b) NPA Provision has been written back of those accounts whose recovery is affected during the year.

(p) STATUTORY RESERVES

Company has made an appropriation of Rs.899218.49 (P.Y. Rs.601938.79) out of the Profit for the year ended 31st March,2015 to the statutory reserve pursuant to the requirement of RBI guidelines.

A) Basis of Preparation of Financial Statement

The accompanying financial statement have been prepared and presented under the historical cost convention and conform in all material aspects to the Generally Accepted Accounting Principles in India which encompasses applicable accounting standards notified by the Companies (Accounting Standards) Rules, 2006, prudential norms for Income recognition and provision for non performing assets as prescribed by Reserve Bank of India for Non Banking Financial Companies, complies with the accounting standards referred to in Section 211 (3C) of the Companies Act, 1956 read with the General Circular 15 2013 dated 13th Sept.,2013 of the Ministry of Corporate Affairs in respect of section 133 of the Companies Act, 2013 as adopted consistently by the company and other statutory provision and regulatory framework. The Company adopts the accrual concept in the preparation of Accounts.

(b) USE OF ESTIMATES

The preparation of financial statement in conformity with generally accepted accounting principles require estimate and assumptions to be made that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities on the date of financial statement and the reported amounts of revenues and expenses during the reporting period, actual results could differ from these estimates and difference between actual results and estimate are recognized in the periods in which the results are known/ materialize.

(c) REVENUE RECOGNITION

The company follows the accrual basis of accounting except in the following case where the same are recorded on cash basis on ascertainment of risk and obligation

a. Interest and other dues are recognized on accrual basis except in the case of income on Non- performing Assets (NPAs) which is recognized, as and when received, as per the prudential norms prescribed by the RBI.

b. Interest on allotment/call money in arrears, on shares, is accounted as and when received due to practical difficulties.

c. Dividend declared by the respective companies'' up to the close of the accounting period are accounted for as income, once the right to receive is established.

(d) CASH FLOW STATEMENT

The cash flow statement is prepared using the "Indirect method set out in Accounting Standard 3" Cash Flow statement, which presents cash flow from operating, investing and financing activities of the company. Cash and cash equivalent presented in the cash flow statement consists of cash in hand and unencumbered lightly liquid Bank Balance.

(e) FIXED ASSETS

Fixed assets are carried at cost of acquisition or construction (net of CENVAT where applicable). They are carried at historical cost less accumulated depreciation.

(f) DEPRECIATION

Depreciation is charged over the estimated useful life of fixed assets on written down value basis. The rates of depreciation for fixed assets, which are not lower than the rates prescribed in Schedule XIV to the Companies Act, 1956.

(g) INVESTMENT

All Investments which are held for more than one year from date of acquisition are classified as long term investment and are carried at cost.

(h) RETIREMENT BENEFIT

No provision has been made in accounts against liability in respect of future payment of Gratuity, Leave Encashment, ESI, Provident Fund and Bonus to employee as in the opinion of the management neither the Gratuity, ESI, Provident Fund and Bonus Act apply to the company nor any employee qualifies for entitlement of such benefits.

(i) BORROWING COST

Borrowing costs that are attributable to the acquisition or construction of qualifying assets are capitalized as part of the cost of such assets. Borrowing costs relating to working capital are charged to profit and loss account as expenses, if any, incurred.

(j) EARNINGS PER SHARE

The company reports basic and diluted earning per shares computed in accordance with Accounting Standard-20 -Earning per share. Basic EPS is calculated by dividing the Net Profit after tax for the year attributable to equity share holders by the weighted Average number of Equity Shares outstanding during the year.

(k) PRIOR PERIOD ITEM

Income and expenditure pertaining to prior period which were omitted to be recorded in last year due to error or omission in books are duly reflected under head of prior period items in the statement of Profit & loss of current year.

(l) TAXATION

1) The Provision for wealth tax and current tax has been provided in accordance with provision of wealth tax Act 1956 and the Income Tax Act, 1961 respectively.

2) Deferred tax assets and liabilities are recognized on a prudent basis for future tax consequences of timing differences arising between the carrying value of assets and liabilities and their respective tax basis, and carried forward losses. It is measured using tax rates and tax laws that have been enacted or substantially enacted at the balance sheet date. The impact of changes in deferred tax assets and liabilities is recognized in the profit and loss account.

3) Minimum Alternative Tax (''MAT'') under the provisions of the Income-tax Act, 1961 is recognised as current tax in the Statement of Profit and Loss as per recommendations contained in the guidance notes issued by ICAI, the credit available under the Act in respect of MAT paid is recognised as an asset only when and to the extent there is convincing evidence that the company will pay normal income tax during the period for which the MAT credit can be carried forward for set-off against the normal tax liability. MAT credit recognised as an asset is reviewed at each balance sheet date and written down to the extent the aforesaid convincing evidence no longer exists.

(m) PROVISION AND CONTINGENCIES

Provisions involving substantial degree of estimation in measurement are recognized where there is a Present obligation as a result of past events and it is probable that there will be out flow of resources. Contingent liabilities are not recognized, but are disclosed in the notes of accounts, contingent assets are neither recognized nor disclosed in the financial statement.

(n) CONTINGENCIES AND EVENTS OCCURRING AFTER THE BALANCE SHEET DATE

Accounting for contingencies (gains and losses) arising out of contractual obligations, are made only on the basis of mutual acceptances. Events occurring after the date of the Balance Sheet are considered up to the date of approval of the accounts by the Board, where material.

(o) IMPAIRMENT OF ASSETS

Fixed asset are reviewed for impairment whenever events or changes in circumstances indicates that the carrying amount of assets may not be recoverable. If such assets are considered to be impaired, the impairment is recognized by debiting the Profit & Loss Account and is measured as the amount by which the carrying cost of assets exceeds the fair value of assets. The impairment loss recognized in prior accounting period is reversed, if there has been a change in the estimate of recoverable amount. By virtue of this, Company has carried out comprehensive exercise, to assess the impairment loss of assets based on such exercise.

(p) Provision/ Write Off against Loans and Other Credit Facilities

(a) All credit exposures are classified into performing and non-performing assets as per the RBI guidelines. Further, NPAs are classified into Sub-Standard, Doubtful & Loss Assets based on the criteria stipulated by RBI. Provisions are made on Standard, Sub-Standard and Doubtful Assets at the rates prescribed by RBI. Loss Assets & Unsecured portion of Doubtful Assets are provided/ written off as per the RBI guidelines. Additional provisions are made against specific non-performing assets over and above what is stated above, if in the opinion of the management, increased provisions are necessary.

(b) NPA Provision has been written back of those accounts whose recovery is affected during the year.

(A) Basis of Preparation of Financial Statement

a) The accompanying financial statement have been prepared and presented under the historical cost convention and conform in all material aspects to the Generally Accepted Accounting Principles in India which encompasses applicable accounting standards notified by the Companies (Accounting Standards) Rules, 2006, prudential norms for Income recognition and provision for non performing assets as prescribed by Reserve Bank of India for Non Banking Financial Companies, complies with the accounting standards referred to in Section 211 (3C) of the Companies Act, 1956 as adopted consistently by the company and other statutory provision and regulatory framework.. The Company adopts the accrual concept in the preparation of Accounts.

(b) CURRENT AND NON CURRENT CLASSIFICATION

All Assets and Liabilities are classified into Current and Noncurrent.

ASSETS: - As assets is classified as current when it satisfies any of the following criteria:

(i) It is expected to be realized in or intended for sale or consumption in the company normal operating cycle.

(ii) It is held primarily for the purpose of being traded.

(iii) It is expected to be realized within 12 months of the reporting date or

(iv) It is Cash or Cash equivalent unless it is restricted from being exchanged or used to settle a liability for at least 12 months after the reporting date.

Current assets include the current position of the non current financial assets. All other Assets are classified as Non current.

LIABILITY: - A Liability is classified as current when it satisfies any of the following criteria:

(i) It is expected to be settled in the companies normal operating cycle, or

(ii) It is held primarily for the purpose of being traded, or

(iii) It is due to be settled within 12 months after the reporting date, or

(iv) The company does not have an unconditional right to date settlement of the liability for at least 12 months after the reporting date. Term of a liability that could at the option of the counter party result in its settlement by the issue of equity instrument do not affected its classification. Current liability includes current position of the non current financial liabilities all other liabilities are classified as Noncurrent.

(B) Use of Estimates

The preparation of financial statements require estimates and assumptions considered in the reported amount of assets and liabilities (including Contingent liabilities) as of the date of financial statements and the reported income and expenses during the reporting period. The management believes that the estimates used in preparation of financial statement are prudent and reasonable. Future results could differ from these estimates.

(C) Revenue Recognition

The company follows the accrual basis of accounting except in the following case where the same are recorded on cash basis on ascertainment of risk and obligation

a. Interest and other dues are recognized on accrual basis except in the case of income on Non-performing Assets (NPAs) which is recognized, as and when received, as per the prudential norms prescribe by the RBI.

b. Interest on allotment/call money in arrears, on shares, are accounted as and when received due to

(i) Long term Investments are carried at acquisition cost.

(ii) Current investments are carried at the lower of cost or fair value on an individual basis. However, appreciation if any, within the category, is available for set off.

(D) Fixed Assets :

Fixed Assets are stated at cost (inclusive of expenses incurred for acquisition thereof) less accumulated depreciation.

(E) Depreciation :

Depreciation has been provided on WDV method as per the rate and manner prescribed in Schedule XIV of the Companies Act, 1956.

(F) Investment:

All Investment are held for more than a year from date of acquisition are classified as long term investment and are carried at cost . Investment are classified non current investment and same are carried at carried at Carrying Cost without deducting the diminution in value of Rs.9986/- of PANJON LTD. of due to temporary in nature in the opinion of the management.

(G) Retirement Benefit:

No provision has been made in accounts against liability in respect of future payment of Gratuity, Leave Encashment, ESI, Provident Fund and Bonus to employee as in the opinion of the management neither the Gratuity, ESI, Provident Fund and Bonus Act apply to the company nor any employee qualifies for entitlement of such benefits. Management further stated that they are in process to determine the retirement benefit as per As-15 (Revised) and accordingly no provision was made in the accounts. Further they opined that same will be accounted on payment basis.

(H) Borrowing Cost:

Borrowing costs that are attributable to the acquisition or construction of qualifying assets are capitalized as part of the cost of such assets. Borrowing costs relating to working capital are charged to profit and loss account as expenses if any incurred.

(I) Earnings per share

The earning considered to ascertain the Company''s EPS comprises the net profit after tax of the year and includes the past tax effect of any extra ordinary items.

(J) Prior Period Item

Prior period item (if any) has been separately disclosed in Profit & Loss Account as per AS-5.

(K) Taxation

Current income tax is measured at the amount expected to be paid to the tax authorities in accordance with the income tax Act. Deferred tax Asset is recognized, subject to the consideration of prudence, on timing difference, being the difference between taxable income and accounting income/expenditure that originate in one period and are capable of being reversed in one or more subsequent year(s).Deferred taxes are reviewed for their carrying values at each balance sheet dates.

(L) Provision and Contingencies

Provisions involving substantial degree of estimation in measurement are recognized where there is a present obligation as a result of past events and if it is probable that there will be out flow of resources Contingent liabilities are not recognized, but are disclosed in the notes of accounts, contingent assets are neither recognized nor disclosed in the financial statement. However In current year , Company have written back the provision of income tax for assessment year (2008-09) in the financial statement as per order received in favor of company. But Income Tax department has filled Second Appeal before ITAT Indore against 1st Appeal decided in favour of the Company.

(M) Contingencies and Events occurring after the Balance Sheet date.

Accounting for contingencies (gains and losses) arising out of contractual obligations, are made only on the basis of mutual acceptances. Events occurring after the date of the Balance Sheet are considered up to the date of approval of the accounts by the Board, where material.

(N) Impairment of Assets

An assets is treated as impaired when carrying cost of assets exceeds its recoverable amount. Thus based on such exercise, there is no impairment of assets, accordingly no adjustment in respect of loss as impairment of assets is required to be made in the accounts.

(O) Provision/ Write Off against Loans and Other Credit Facilities

(a) All credit exposures are classified into performing and non-performing assets as per the RBI guidelines. Further, NPAs are classified into Sub-Standard, Doubtful & Loss Assets based on the criteria stipulated by RBI Provisions are made on Standard, Sub-Standard and Doubtful Assets as the rates prescribed by RBI. Loss Assets & Unsecured portion of Doubtful Assets are provided/ written off as per the extent RBI guidelines. Additional provisions are made against specific non-performing assets over and above what is stated above, if in the opinion of the management, increase provisions are necessary.

(b) NPA Provision has been written back of those accounts whose recovery is affected in during the year.

(P ) PREVIOUS YEAR FIGURES

(A) Basis of Preparation of Financial Statement

a) The accompanying financial statement have been prepared on a historical cost convention and conform in all material aspects to the Generally Accepted Accounting Principles in India which encompasses applicable accounting standards notified by the Companies (Accounting Standards) Rules, 2006, prudential norms for Income recognition and provision for non-performing assets as prescribed by Reserve Bank of India for Non-Banking Financial Companies, complies with the accounting standards referred to in Section 211 (3C) of the Companies Act, 1956 as adopted consistently by the company and other statutory provision and regulatory framework.. The Company adopts the accrual concept in the preparation of Accounts.

b) Presentation & disclosure of financial statement

During the year ended 31st march, 2012 the revised schedule VI notified under the company Act, 1956 has become applicable to the company for preparation and presentation of its financial statement. The adaption of revised schedule VI does not impact recognition and measurement principle followed for preparation of financial statement. However it has significant impact on presentation and disclosure made in the financial statement. The company has also declared the previous year figures in accordance with the requirement applicable in the current year.

(B) Use of Estimates

The preparation of financial statements require estimates and assumptions considered in the reported amount of assets and liabilities (including Contingent liabilities) as of the date of financial statements and the reported income and expenses during the reporting period. The management believes that the estimates used in preparation of financial statement are prudent and reasonable. Future results could differ from these estimates.

(C) Revenue Recognition

The company follows the accrual basis of accounting except in the following case where the same are recorded on cash basis on ascertainment of risk and obligation

a. Interest and other dues are recognized on accrual basis except in the case of income on Non-performing Assets (NPAs) which is recognized, as and when received, as per the prudential norms prescribe by the RBI.

b. Interest on allotment/call money in arrears, on shares, are accounted as and when received due to practical difficulties.

c. Dividend declared by the respective Companies till the close of the accounting period are accounted for as income, once the right to receive is established.

(D) Fixed Assets :

Fixed Assets are stated at cost (inclusive of expenses incurred for acquisition thereof) less accumulated depreciation.

(E) Depreciation :

Depreciation has been provided on WDV method as per the rate and manner prescribed in Schedule XIV of the Companies Act, 1956.

(F) Investment:

All Investment are held for more than a year from date of acquisition are classified as long term investment and are carried at cost. Investments are classified under two categories i.e. current and long term and are valued in according with the RBI Guidelines as applicable to Non-Banking Financial Companies (NBFCs) and Accounting Standard 13 on 'Accounting for Investment' as notified by the companies (accounting Standard) Rules, 2006.

(i) Long term Investments are carried at acquisition cost.

(ii) Current investments are carried at the lower of cost or fair value on an individual basis. However, appreciation if any, within the category, is available for set off.

(G) Retirement Benefit:

No provision has been made in accounts against liability in respect of future payment of Gratuity, Leave Encashment, ESI, Provident Fund and Bonus to employee as in the opinion of the management neither the Gratuity, ESI, Provident Fund and Bonus Act apply to the company nor any employee qualifies for entitlement of such benefits. Management further stated that they are in process to determine the retirement benefit as per As-15 (Revised) and accordingly no provision was made in the accounts. Further they opined that same will be accounted on payment basis.

(H) Borrowing Cost:

Borrowing costs that are attributable to the acquisition or construction of qualifying assets are capitalized as part of the cost of such assets. Borrowing costs relating to working capital are charged to profit and loss account as expenses if any incurred.

(I) Earnings per share

The earning considered to ascertain the Company's EPS comprises the net profit after tax of the year and includes the past tax effect of any extra ordinary items.

(J) Prior Period Item

Prior period item has been separately disclosed in Profit & Loss Account as per AS-5.

(K) Taxation

Current income tax is measured at the amount expected to be paid to the tax authorities in accordance with the income tax Act. Deferred tax Asset is recognized, subject to the consideration of prudence, on timing difference, being the difference between taxable income and accounting income/expenditure that originate in one period and are capable of being reversed in one or more subsequent year(s). Deferred taxes are reviewed for their carrying values at each balance sheet dates.

(L) Provision and Contingencies

Provisions involving substantial degree of estimation in measurement are recognized where there is a present obligation as a result of past events and if it is probable that there will be out flow of resources Contingent liabilities are not recognized, but are disclosed in the notes of accounts, contingent assets are neither recognized nor disclosed in the financial statement.

(M) Contingencies and Events occurring after the Balance Sheet date.

Accounting for contingencies (gains and losses) arising out of contractual obligations, are made only on the basis of mutual acceptances. Events occurring after the date of the Balance Sheet are considered up to the date of approval of the accounts by the Board, where material.

(N) Impairment of Assets

An assets is treated as impaired when carrying cost of assets exceeds its recoverable amount. Thus based on such exercise, there is no impairment of assets, accordingly no adjustment in respect of loss as impairment of assets is required to be made in the accounts.

(O) Provision/Write Off against Loans and Other Credit Facilities

(a) All credit exposures are classified into performing and non-performing assets as per the RBI guidelines. Further, NPAs are classified into Sub-Standard, Doubtful & Loss Assets based on the criteria stipulated by RBI Provisions are made on Standard, Sub-Standard and Doubtful Assets as the rates prescribed by RBI. Loss Assets & Unsecured portion of Doubtful Assets are provided/written off as per the extent RBI guidelines. Additional provisions are made against specific non-performing assets over and above what is stated above, if in the opinion of the management, increase provisions are necessary.

(b) NPA Provision has been written back of those accounts whose recovery is affected in during the year.

(A) System of Accounting

a. The financial statement have been prepared under the historical cost convention in accordance with the generally accepted accounting principles and complies with the accounting standards referred to in Section 211 (3C) of the Companies Act, 1956 as adopted consistently by the company. The Company adopts the accrual concept in the preparation of Accounts.

b. The Company has followed the prudential norms for Income recognition and provision for non performing assets as prescribed by Reserve Bank of India for Non Banking Financial Companies.

(B) Revenue Recognition

a. Income & Expenditures are recognized and accounted on accrual basis. Interest from customer/debtors who are not repaying the installment/loan are accounted when received and appropriated. Moreover revenue recognition is postponed to a later year only when it is not able to estimate if with reasonable accuracy.

b. Interest on allotment/call money in arrears, on shares, are accounted as and when received due to practical difficulties.

c. Dividend is accounted when the right to receive payment is established.

d. Income on NPA has been recognized as and when received.

e. Gratuity and Retirement Benefits for the employee are accounted for on payment basis.

(C) Fixed Assets :

Fixed Assets are stated at cost (inclusive of expenses incurred for acquisition thereof) less accumulated depreciation.

(D) Depreciation :

Depreciation has been provided on WDV method as per the rate and manner prescribed in Schedule XIV of the Companies Act, 1956.

(E) Investment:

Investments are classified as Long Term Investment and shown at cost. No Provision has been made for diminution in the value of investment as all the investments are long term and in the boards opinion the decline is temporary.

(G) Non Performing Assets and Provision:

All loan where the installment are over due for more than six months from the date of demand are classified as non performing assets in accordance with the prudential norms prescribed by the Reserve Bank of India Provision for non performing assets has been made as per RBI Norm. However, the advances by way of loans are stated before provision for NPA & Doubtful Debts.

(H) Retirement Benefit:

No provision has been made in accounts against liability in respect of future payment of Gratuity, Leave Encashment, ESI, Provident Fund and Bonus to employee as in the opinion of the management neither the Gratuity, ESI, Provident Fund and Bonus Act apply to the company nor any employee qualifies for entitlement of such benefits. Management further stated that they are in process to determine the retirement benefit as per As-15 (Revised) and accordingly no provision was made in the accounts. Further they opined that same will be accounted on payment basis.

(I) Borrowing Cost:

Borrowing costs relating to working capital are charged to profit and loss account as expenses if any incurred.

(J) Earning per share

The earning considered to ascertain the Companys EPS comprises the net profit after tax of the year and includes the past tax effect of any extra ordinary items.

(K) Prior Period Item

Prior period item has been separately disclosed in Profit & Loss Account as per AS-5.

(L) Accounting for taxes on income.

Provision for current tax are computed as per provision under the Income Tax Act, 1961 Deferred tax liability is recognized if any subject to the consideration of prudence, on timing difference, being the difference between taxable income and accounting income that originate in one period and are capable of being reversed in one or more subsequent period.

(M) Provision , Contingent liabilities and Contingent Assets

Provisions involving substantial degree of estimation in measurement are recognized where there is a present obligation as a result of past events and if it is probable that there will be out flow of resources Contingent liabilities are not recognized, but are disclosed in the notes of accounts, contingent assets are neither recognized nor disclosed in the financial statement.

(N) Contingencies and Events occurring after the Balance Sheet date.

Accounting for contingencies (gains and losses) arising out of contractual obligations, are made only on the basis of mutual acceptances. Events occurring after the date of the Balance Sheet are considered up to the date of approval of the accounts by the Board, where material.

(O) Impairment of Assets

An assets is treated as impaired when carrying cost of assets exceeds its recoverable amount. Thus based on such exercise, there is no impairment of assets, accordingly no adjustment in respect of loss as impairment of assets is required to be made in the accounts.

(P) Loans & Advances

Loans & Advances granted by the company are repayable on demand. Hence the same are not classified between different categories.

(Q) Provision/ Write Off against Loans & Advances and Debtors

(a) All NPA, Loans & Advances & Debtors are classified into Sub-Standard, Doubtful & Loss Assets based on the criteria stipulated by RBI. Provision has been made on the Sub-Standard and Doubtful Assets as the rates prescribed by RBI. Loss Assets & Unsecured portion of Doubtful Assets are provided/ written off as per the extent RBI guidelines. Additional provision on some Advances & Debtors has not been made due to recoverable in the opinion of the Management.

(b) NPA Provision has been written back of those accounts whose recovery is affected in during the year.