Notes to Accounts of F Mec International Financial Services Ltd.

Mar 31, 2024

2.16 Provisions and Contingent Liabilities

Provisions are recognised when the Company has a present legal or constructive obligation as a result of past events, it is probable that an outflow of resources will be required to settle the obligation and the amount can be reliably estimated. Provisions are not recognised for future operating losses.

Provisions are measured at the present value of management’s best estimate of the expenditure required to settle the present obligation at the end of the reporting period. The discount rate used to determine the present value is a pre tax rate that reflects current market assessments of the time value of money and the risks specific to the liability. The increase in the provision due to the passage of time is recognised as interest expense.

Contingent liabilities are disclosed when there is a possible obligation arising from past events, the existence of which will be confirmed only by the occurrence or non-occurrence of one or more uncertain future events not wholly within the control of the Company or a present obligation that arises from past events where it is either not probable that an outflow of resources will be required to settle the obligation or a reliable estimate of the amount cannot be made.

2.17 Financial Instruments a). Financial Assets

Financial assets are recognised when the Company becomes a party to the contractual provisions of the instrument. On initial recognition, a financial asset is recognised at fair value, in case of Financial assets which are recognised at fair value through profit and loss (FVTPL), its transaction cost are recognised in the statement of profit and loss. In other cases, the transaction cost are attributed to the acquisition

value of the financial asset. Financial assets are subsequently classified and measured at

• amortised cost

• fair value through profit and loss (FVTPL).

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 value changes in ‘Other Comprehensive Income’.

Impairment of financial assets

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

Financial assets where no significant increase in credit risk has been observed are considered to be in ''stage I’ and for which a 12 month ECL is recognised. Financial assets that are considered to have significant increase in credit risk are considered to be in ‘stage 2’ and those which are in default or for which there is an objective evidence of impairment are considered to be in ‘stage 3’. Lifetime ECL is recognised for stage 2 and stage 3 financial assets.

At initial recognition, allowance (or provision in the case of loan commitments) is required for ECL towards default events that are possible in the next 12 months, or less, where the remaining life is less than 12 months.

In the event of a significant increase in credit risk, allowance (or provision) is required for ECL towards all possible default events over the expected life of the financial instrument (‘lifetime ECL’).

Financial assets (and the related impairment loss allowances) are written off in full, when there is no realistic prospect of recovery.

Treatment of the different stages of financial assets and the methodology of determination of ECI.

(i) Credit impaired (stage 3)

The Company recognises a financial asset to be credit impaired and in stage 3 by considering relevant objective evidence, primarily whether:

- Contractual payments of either principal or interest are past due for more than 90 days;

-The loan is otherwise considered to be in default.

Restructured loans, where repayment terms are renegotiated as compared to the original contracted terms due to significant credit distress of the borrower, are classified as credit impaired. Such loans continue to be in stage 3 until they exhibit regular payment of renegotiated principal and interest over a minimum observation period, typically 12 months- post renegotiation, and there are no other indicators of impairment. Having satisfied the conditions of timely payment over the observation period these loans could be transferred to stage I or 2 and a fresh assessment of the risk of default be done for such loans

Interest income is recognised by applying the EIR to the net amortised cost amount i.e. gross carrying amount less ECL allowance.

(ii) ’Significant increase in credit risk (stage 21

An assessment of whether credit risk has increased significantly since initial recognition is performed at each reporting period by considering the change in the risk of default of the loan exposure. However, unless identified at an earlier stage, 30 days past due is considered as an indication of financial assets to have suffered a significant increase in credit risk. Based on other indications such as borrower’s frequently delaying payments beyond due dates though not 30 days past due are included in stage 2 for mortgage loans.

The measurement of risk of defaults under stage 2 is computed on homogenous portfolios, generally by nature of loans, tenors, underlying collateral, geographies and borrower profiles. The default risk is assessed using PD (probability- of default) derived from past behavioural trends of default across the identified homogenous portfolios. These past trends factor in the past customer behavioural trends, credit transition probabilities and macroeconomic conditions. The assessed PDs are then aligned considering future economic conditions that are determined to have a bearing on ECL

(''") ''Without significant increase in credit risk since initial recognition fstage 1)

ECL resulting from default events that are possible in the next 12 months are recognised for financialinstruments in stage 1. The Company has ascertained default possibilities on past behavioural trends witnessed for each homogenous portfolio using application/behaviourial score cards and other performance indicators, determined statistically.

(iv) ''Measurement of ECI.

The assessment of credit risk and estimation of ECL are unbiased and probability weighted. It incorporates all information that is relevant including information about past events, current conditions and reasonable forecasts of future events and economic conditions at the reporting date. In addition, the estimation of ECL takes into account the time value of money. Forward looking economic scenarios determined with reference to external forecasts of economic parameters that have demonstrated a linkage to the performance of our portfolios over a period of time have been applied to determine impact of macro economic factors.

The Company has calculated ECL using three main components: a probability of default (PD), a loss given default (LGD) and the exposure at default (EAD). ECL is calculated by multiplying the PD, LGD and EAD and adjusted for time value of money using a rate which is a reasonable approximation of EIR

- Determination of PD is covered above for each stages of ECL

- EAD represents the expected balance at default, taking into account the repayment of principal and interest from the Balance Sheet date to the date of default together with any expected drawdowns of committed facilities.

- LGD represents expected losses on the EAD given the event of default, taking into account, among other attributes, the mitigating effect of collateral value at the time it is expected to be realised and the time value of money.

b). Financial Liabilities

Financial liabilities are recognised when the Company becomes a party to the contractual provisions of the instrument. Financial liabilities are initially measured at the amortised cost unless at initial recognition, they are classified as fair value through profit and loss.

Financial liabilities are subsequently measured at amortised cost using the Effective Interest Rate (EIR) method Financial liabilities carried at fair value through profit or loss are measured at fair value with all changes in fair value recognised in the Statement of Profit and Loss.

A financial liability is derecognised when the obligation specified in the.contract is discharged, cancelled or expires.

2.18 Derivative financial instruments

Derivative financial instruments such as forward contracts, option contracts and cross currency swaps, to hedge its foreign currency risks are initially recognised at fair value on the date a derivative contract is entered into and are subsequently re-measured at their fair value with changes in fair value recognised in the Statement of Profit and Loss in the period when they arise.

37 Financial risk management

The Company s business activities are exposed to a variety of financial risks, namely liquidity risk, market risks and credit risk. The Company’s senior management has the overall responsibility for establishing and governing the Company’s risk management framework. The Company has constituted a Risk Management Committee, which is responsible for developing and monitoring the Company’s risk management policies. The Company’s risk management policies are established to identify and analyse the risks faced by the Company, to set and monitor appropriate risk limits and controls, periodically review the changes in market conditions and reflect the changes in the policy accordingly. The key risks and mitigating actions are also placed before the Audit Committee of the Company.

Management of liquidity and funding risk

Liquidity risk arises from mismatches in the timing of cash flows.

Funding risk arises:

- when long term assets cannot be funded at the expected term resulting in cashflow mismatches;

- amidst volatile market conditions impacting sourcing of funds from banks and money markets.

Liquidity and funding risk is measured by identifying gaps in the structural and dynamic liquidity statements.

Liquidity and funding risk is monitered by :

- assessment of the gap between visibility ot funds and the near term liabilities given current liquidity conditions and evolving regulatory directions for NBFCs.

- a constant calibration of sources of funds in line with emerging market conditions in banking and money markets.

- periodic reviews by risk management committee relating to the liquidity position and stress tests assuming varied ‘what if scenarios and comparing probable gaps with the liquidity buffers maintained by the Company.

Management of market risk

Market risk is the risk that the fair value of future cash flow of financial instruments will fluctuate due to changes in the market variables such as interest rates, foreign exchange rates and equity prices. The Company do not have any exposure to foreign exchange rate and eauitv Drice risk.

Management of credit risk

Credit risk is the risk of financial loss arising out of a customer or counterparty failing to meet their repayment obligations to the Company. It has a diversified lending model and focuses on six broad categories viz: (i) consumer lending, (ii) SME lending, (iii) rural lending, (iv) mortgages, (v) loan against securities, and (vi) commercial lending. The Company assesses the credit quality of all financial instruments that are subject to credit risk.

«¦» IU

a). Classification of financial assets under various stages

The Company classifies its financial assets in three stages having the following characteristics:

Stage 1

Unimpaired and without significant increase in credit risk since initial recognition on which a 12 month allowance for ECL is recognised’

Stage 2:

A significant increase in credit risk since initial recognition on which a lifetime ECL is recognised;

Stage 3:

Objective evidence of impairment, and are therefore considered to be in default or otherwise credit impaired on which a lifetime ECL is recognised.

Unless identified at an earlier stage, all financial assets are deemed to have suffered a significant increase in credit risk when they are 30 days past due (DPD) and are accordingly transferred from stage 1 to stage 2. For stage 1 an ECL allowance is calculated based on a 12 month Point in Time (PIT) probability weighted probability of default (PD). For stage 2 and 3 assets a life time ECL is calculated based on a lifetime PD.

nancial instruments other than loans were subjected to simplified ECL approach under Ind AS 109 ''Financial Instruments'' and accordingly were not subject to sensitivity of future economic conditions.

³⁸ ^ ^{tHe PreVi}°^{US year haVe bCen reStated}’ ^re8^rouP^ecl and reclassified wherever required to comply with the requirement of Ind AS and Schedule 111, Division III,

39 All amounts in the financial statements are rounded off to the nearest amount in Indian Rupees ''000, unless stated otherwise.

40 Note I to 39 are annexed to and form an integral part of the Balance Sheet as at 31st Mar 2024. Statement of Profit and Loss, statement of cash flows and statement of changes in equity for the year ended as on that date.

For Sanjay K Singhal & Co For and on behalf of the Board

(Chartered , F Mec International Financial Services Limited

.........

(Apo\rve Bansal) (Renuka Chouhan)

( anjay ku,. / Managing Director Director .\u c , . ,

Partner DIN-08052540 DIN-09547785 ‘ •

M. No: 503475

Place: Delhi

Date: 29/05/2024 \ (Mahiirta Jain) (R^nika Dhall)

Chief Financial Officer Company Secretary

PAN:APJPJ2796N & Compliance Officer

Membership No:A39463

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Mar 31, 2023

2.16 Proviiiont anil Contingent L ialiilitim

Provision* are recognised when Uic Company lias a present legal or constructive obligntion as 11 result n: past events, it t« probable ihut an outflow af resources will be required to settle the obligation ulnl the niti, iunl can he reliably estimated. Provisions are not recognised lor fulure operating losses.

Provisions are mensured at ibe present value of management''s best estimate of lire expenditure required to settle the present obligation ut Ike end of the reporting period ["he discount rule used to determine the present value is a pre lav rate that reflect* current market assessments or the time value of money and the risks specific to tire liability, The increase in the provision due to the passage of time is recognised as interest, expense.

Contingent liabilities arc disclosed when there is 11 possible obligation arising from past events the existence of which will be confirmed only bv the occurrence or non-occurrence of one or more Uncertain future events rot wholly within flic control of the Company or a present obligation that arises from past events where it ts either nut provable that an °ut flow of resources Will be required to settle tlie obligation or a reliable estimate of the amount cannot be made.

2.17 Financial instrument* n). Financial Asset*

Financial assets are recognised when the Company becomes a party to the contractual provisions of the instrument On Initial recognition, a financial asset is recognised nt fair value, in case of Financial assets which arc recognised at fan value through profit and loss (I VTI’L). it* transaction cost arc recognised in the statement ol profit ami loss. In other eases, the transaction cost are attributed to the acquisition

value of the financial asset, financial assets arc subsequently classified and measured at

• amortised cost

♦ fair vnliic through profit and loss

Other equity investment*

All oilier equity investments are mensured at fait value, with value changes recognised in Statcmci i of Profit and Los*, except for those equity investments tor which the Company has elected to present the *ulu» change:, in ‘Other Comprehensive Income''

linpairnirilt of financial asset*

In accordance with lnd AS 109, the Company uses ‘Expected Credit Loss’ (F!CL) model, for evaluating impairment of limine la! assets other than those measured at fair value through profit and loss (I-VI l^JL),

Financial assets where no significant increase in credit risk lias been observed are considered to be in ‘si.14c I'' and tor which a 12 month UCL 1* recognised Financial assets that are considered to have -.ignifieunt in. 1.• in 1 r.-.iii ri i.r considered to be in ''tTage 2'' iuid those which are in default 01 tor which there is an objective evidence of impairment ¦re considered to be in ‘stage 3’, Lifetime BCL is recognised for stage 2 and singe 3 financial asset*.

At initial recognition, allowance (or provision in the caw of loan oummitmcnts) is required lor I ( I inwards dct.iull events that ore possible in the next 12 months, or less, where the remaining life is less than 12 monthIn the event nf a significant increase in credii risk, allowance (or provision) is required for ECI. towards nil possible default events over the expected life of the financial instrument flifetime ECL’)

financial assets (and the related impairment loss allowances) nre written off in toll, when there is no realistic prospect of recovery.

Treatment of the different stages of financial assets and the methodology of determination of EC 1 (i) Credit impaired (si.me 2)

Tbe Company recognises a financial asset to be credit impaired and in xtuge 3 by considering relevant objective evidence, primarily whether

- Contractual payments of either principal or interest arc past due tor more than It) lines,

- The loan is otherwise considered to be in default,

Restructured hunts, where repayment terms ure renegotiated as compared to the original contracted terms due to significant credii distress ot the borrower, ure classified as credii Impaired- Such loans continue in lie n stage 3 until they exhibit regular payrnenl of renegotiated principal and interest over a minimum observation period, typically 12 months- post renegotiation, and there nre no other indicators of impairment Having satisfied the conditions of tiroclv payment over the observation period these loans could bo transferred to stage I or 2 and a fresh assessment of the risk o''l default he done for such loans

Lute real Income is recognised by applying the EIR to the net amortised cost amount i.e gross carrying uitinunt less t-l I nllowunoe,

(II) ''Significant inervase in crnlll ri.k istai''e 2l

An assessment of whether credit risk has increased significantly since initial recognition is performed ui each reptwiina period by considering the cliangu in the risk of default of the loan exposure. However, unless identified at nil earher stage. 30 days post due is considered its an indication uf financial assets to have suffered u significant increase ui credit risk. Bused on other indications such us borrower’). frequently delaying payments beyond due lutes tlmagli not 30 da . past due are included in stage 2 for mortgage loans.

the measurement of risk of defaults under stage 2 is computed on honiogL''iunin portfolios, generally by nature ol loans, tenors, underlying collateral, geographies and borrower profiles. The default risk l> assessed using PD (probability of default) derived front past behavioural trends of default across die identified homogenous portfolio ¦. I''iicie past trends factor in the past customer behavioural trends, credit transition probabilities and macroeconomic condnionr- I lie assessed Pfds nre then aligned considering f''uiure economic conditions thul are determined to have j bearing on ECI

(iii) ’Withnut significant marair in credit risk since initial rccopnitinn (Huge li

ECU resulting from del.mil events that are possible in the next 17 months arc recognised for 1 imincialiastnimcniS in stage I. The Company has ascertained dcfuali possibilities on past behavioural trends witnessed tor each homogenous pciitlbho using npplicutiorv''bdiflvieurial score cards und other performance indicators, determined statistically.

(Iv) ’Mrasurcmcniof ECL

i''hc assessment of credit risk and estimation of ECL are unbiased and probability weighted II incorporates all information that is relevant including inliirmution about past eve tits, correct conditions and reasonable foremasts ol flnure events and eeopamk oomlilions at the reporting date In addition, the estimation of I t I mU-> mi, account the time value of money. Forward looking economic scenarios determined witli reference lo cxiurnal tinvam nf economic parameters dial have demonstrated a linkage to ihc performance of uur portfolios over c perirai of time have ir.cn applied to determine impact of macro economic factors,

Hie Company has calculated ECL using three main components: a probability or default (Pl>) i I given defnult (LGD) and the exposure at default (BAD) ECL is calculated by multiplying the PD. LCD and EAD and adjusted f n time value of money using a rate which is a reasonable: approx rotation of EIR.

- Determination of PD is covered above for each stages of ECL.

* EA1) represents the expected balance at default, taking into account the repayment of principal und interest from tl-.r Balance Sheet date to the date of tlefaulr together with any expected drawdowns of committed facilities.

- LGD represents expected losses on the f AD given the event of default, taking into account, itining othci attribute''. the mitigating effect of collateral value at the time It is expected to be realised and the lime value ol n .me,

b). Financial) l.iubilitks

r innncial liahilittcs are recognised when the Company becomes n party to the coolraetunl provisions of the instrument Financial liabilities arc initially measured at I he amortised cost iinkss at initial recognition, they are classified as fan value through profit and loss.

Financial liabilities are Subsequently measured at unionised cost using the Effective Interest Rare (E!R> method Financial liabilities curried at fair value through profit or loss are measured at fair value with all change? in fair value recognised in the Statement of Profit and l oss

A financial liability is derecognised when the obligation specified in the contract is discharged, cancelled or expires 2.18 Derivative financial instruments

Derivative financial instruments such u% forward contracts, option contracts and cross current. swaps, to hedge m foreign currency risks are initially recognised nt fair value on the date a derivative contract i- entered into arvd arc subsequently re-measured at ihcir fair value with changes in fair value recognised in liic Statement nrPaifit and Loss in the period when they arise.

25 Segment Reporting

As per Indian Accounting Stable.. J (tad AS>IOg “Operating Segments" the Company''s segment reporting „ as helots Opemtnui segments ere rcfHniRi in » manner Cami.Onit wall the internal wpwHrtg provided to Use cl,Id nperaling decision mikui Hie nunagmg director hw been idttUifted as being the chief operating tfccistwi mitket lo txwu the HjuukiuJ ptrfivtnaiK: .n J pteilion or the Con,pany end make tin.legio decisions The Company j, engaged primarily in the business ol Tnumcmii. and providing <- unwrteney Ac^wd n^y. In the context ofladinii Accounting SUinduid IUH Operating Segment, it b ... ak -.1 in constitute single reportable segment

The Company classifies its financial assets in three stafle-; luvlrig the following chntuclcri sites State 1

Unimpaired and without significant increase in credit nsk since initial recognition on which a 12 month allowance for ECI. w recognised:

Stage 2t

A significant increase in credit link since initial recognition on which a lifetime LCL is recognised.

Stage 3:

Objective evidence of impairment, and arc therefore considered to he in default nr ntlierwise ciedit Mips i rest nn which n Incln HCL is recognised

Unleu idemifed w an earlier singe, nil flnunctnl in.sell are deemed to lutve suffered a significant indKiuc in credit risk when Ihey are JO days past due fDPD) anti are accordingly transferred from stage 1 to stage 2, For wage I an K''L allowance Is calculated based on a 12 month Point in I mie (PIT) probability weighted probability of default (PD) Pot stage 2 and I avn ¹ i r time I I is calculated based on a lifetime PD

Financial instrument* other Until loans ware subjected to simplified IX L approach under Ind AS l(W Tmancia in rrurueints and accordingly were isoi subject in sensitivity of future ax nmr.ic conditions

36 I he (igtirrs for (he pre\ nut yejr have been rostmed, regrouped and reclassified wherever required to comply wlm thf reqult einent of Ind AS and Schedule 111, Division til

37 All amounts in the financial statements are rounded ofTin the nearest nmouni ut Indian Rupees UGO, unless slated otherwise.

J8 Note I to J7 arc annexed w end Honan an integral pan of die Balance Sheet as at 3 In Mar 2023. Statement of Profit and Lose, statement of cash flows mid tteiemenl of changes m equity for the year ended us on that date

For Saitjey K Singhet 3kCo * , For and nn behalf of the Board

1C bartered AanipRbrfA-—F Mac lnteranliungl Financial Servleei Limited

FrrmR^No ahu^l^Rftrnalio.''.a! Financial Servtcec. I

: , i ftTniiil) (Itrnnka I InmlntiPj^,A*'' V ^ • ¦''^r

(Saaiav Komar Shfohafb—- j?// Msnagin^ Ditoctur Director

Partner DINXMOS2MO DIN <''^7«_an2JD''V;treilQ-

M. No: 503475 " h [] * I ®*7) ¹

Place Delhi I * /H I

Date 2W5/2023 • i (M nVidia Jain) ''/aiuii Kumar Mia nnu}

ChteFrjltaflOtal Officer Company Secrelarv PAN:APJPJ2796N & Compliance Officer

Membership No:A3932lt

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Mar 31, 2015

1. CORPORATE INFORMATION

FMEC International Financial Services Limited (the company) is a Limited company domiciled in India and incorporated under provision of Companies Act, 1956 as on 7th June 1993 and is Holding of YDS Securities Private Limited. The company is engaged in the business of Financing and providing Consultancy.

2. BASIS OF PREPARATION OF ACCOUNTS

The financial statements are prepared in accordance with Indian Generally Accepted Accounting Principles ("GAAP") under the historical cost convention on the accrual basis. GAAP comprises mandatory accounting standards as specified under Section 133 of the Companies Act 2013 read with Rule 7 of the Companies (Accounts) Rules, 2014. The Financial Statements has been prepared on the accrual basis and under the historical cost convention. The Management evaluates all recently issued or revised accounting standards on an on-going basis.

The Accounting policies adopted in the preparation of financial statements are consistent with those of previous year, except for the change in accounting policy explained below.

3. EARNING PER SHARE

Basic earnings per share is calculated in accordance with the provisions of Accounting Standard-20 "Earnings per Share" are given hereunder:

4. RELATED PARTY DISCLOSURE

I. NAMES OF RELATED PARTIES:

a. The company is Holding of YDS Securities Pvt. Ltd

b. Key Management Personnel:

Name Designation

Mr. Bimal Aggarwal Managing Director

5. Segment information for the year ended 31st March, 2015 as per accounting standard issued by the institute of Chartered Accountants of India are as under. Previous years figures are indicated in brackets.

Assets used in the company's business or liabilities contracted have i at been identified to any of the reportable segment as all the assets and services are used interchangeably between segments. The company believes that it is currently not practicable to provide segment disclosure relating to total assets and liabilities since a meaningful segregation of available data is onerous.

6. In the opinion of the directors, current assets and advances have a value on realization in the ordinary course of the business at least equal to the amount at which these have been stated in the Balance Sheet.

7. Balances of Sundry Creditors/Debtors are subject to confirmation/reconciliation, which in the opinion of themanagement is not significant, adjustments, if any will be carried out as and when settled. However accounts have been reconciled on the basis of materiality.

8. The company is a small and medium sized company as defined in the General Instruction in respect of Accounting Standard notified under the Companies Act, 1956. Accordingly, the Company has complied with the Accounting Standard as applicable to small and Medium Sized Company.

9. There is no contingent liability as Certified by the management of the company.

10. All the known liabilities have been provided for and there are no disputed liabilities asconfirmed by themanagement of the company

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Mar 31, 2014

1. CORPORATE INFORMATION

FMEC International Financial Services Limited (the company) is a Limited company domiciled in India and incorporated under provision of Companies Act, 1956 as on 7th June 1993 and is Holding of YDS Securities Private Limited. The company is engaged in the business of Financing and providing Consultancy.

2. BASIS OF PREPARATION OF ACCOUNTS

The financial statements are prepared in accordance with Indian Generally Accepted Accounting Principles ("GAAP") under the historical cost convention on the accrual basis, GAAP comprises mandatory accounting standards as specified in the Companies (Accounting Standards) Rules, 2006 and the provisions of the Companies Act, 1956. The Financial Statements has been prepared on the accrual basis and under the historical cost convention. The Management evaluates all recently issued or revised accounting standards on an on-going basis.

The Accounting policies adopted in the preparation of financial statements are consistent with those of previous year, except for the change in accounting policy explained below.

3. In the opinion of the directors, current assets and advances have a value on realization in the ordinary course of the business at least equal to the amount at which these have been .stated in the Balance Sheet.

4. Balances of Sundry Creditors/Debtors are subject to confirmation/reconciliation, which in the opinion of themanagement is not significant, adjustments, if any will be carried out as and when settled. However accounts have been reconciled on the basis of materiality.

5. The company is a small and medium sized company as defined in the General Instruction in respect of Accounting Standard notified under the Companies Act, 1956. Accordingly, the Company has complied with the. Accounting Standard as applicable to small and Medium Sized Company.

6. There is no contingent liability as Certified by the management of the company.

7. All the known liabilities have been provided for and there are no disputed liabilities asconfirmed by themanagement of the company.

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Mar 31, 2013

1. CORPORATE INFORMATION

FMEC International Financial Services Limited (the company) is a Limited company domiciled in India and incorporated under provision of Companies Act, 1956 as on 7 th June 1993 and is Holding of YDS Securities Private Limited. The company is engaged in the business of Financing and providing Consultancy.

2. BASIS OF PREPARATION OF ACCOUNTS

The financial statements are prepared in accordance with Indian Generally Accepted Accounting Principles ("GAAP") under the historical cost convention on the accrual basis. GAAP comprises mandatory accounting standards as specified in the Companies (Accounting Standards) Rules, 2006 and the provisions of the Companies Act, 1956. The Financial Statements has been prepared on the accrual basis and under the historical cost convention. The Management evaluates all recently issued or revised accounting standards on an on-going basis.

The Accounting policies adopted in the preparation of financial statements are consistent with those of previous year, except for the change in accounting policy explained below.

3. RELATED PARTY DISCLOSURE

I. NAMES OF RELATED PARTIES:

a. The company is Holding of YDS Securities Pvt. Ltd.

b. Key Management Personnel:

Name Designation

Mr. Bimal Aggarwal Director

4. In the opinion of the directors, current assets and advances have a value on realization in the ordinary course of the business at least equal to the amount at which these have been stated in the Balance Sheet.

5. Balances of Sundry Creditors/Debtors are subject to confirmation/reconciliation, which in the opinion of the management is not significant, adjustments, if any will be carried out as and when settled. However accounts have been reconciled on the basis of materiality.

6. The company is a small and medium sized company as defined in the General Instruction in respect of Accounting Standard notified under the Companies Act, 1956. Accordingly, the Company has complied with the Accounting Standard as applicable to small and Medium Sized Company.

7. There is no contingent liability as Certified by the management of the company.

8. All the known liabilities have been provided for and there are no disputed liabilities asconfirmed by the management of the company.

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Mar 31, 2012

1. CORPORATE INFORMATION

FMEC International Financial Services Limited (the company) is a Limited company domiciled in India and incorporated under provision of Companies Act, 1956 as on 7 th June 1993 and is Holding of YDS Securities Private Limited. The company is engaged in the business of Financing and providing Consultancy.

2. BASIS OF PREPARATION OF ACCOUNTS

The financial statements are prepared in accordance with Indian Generally Accepted Accounting Principles ("GAAP") under the historical cost convention on the accrual basis. GAAP comprises mandatory accounting standards as specified in the Companies (Accounting Standards) Rules, 2006 and the provisions of the Companies Act, 1956. The Financial Statements has been prepared on the accrual basis and under the historical cost convention. The Management evaluates all recently issued or revised accounting standards on an on-going basis.

The Accounting policies adopted in the preparation of financial statements are consistent with those of previous year, except for the change in accounting policy explained below.

3. RELATED PARTY DISCLOSURE

I. NAMES OF RELATED PARTIES:

a. The company is Holding of YDS Securities Pvt. Ltd.

b. Key Management Personnel:

Name Designation

Mr. Bimal Aggarwal Director

4. In the opinion of the directors, current assets and advances have a value on realization in the ordinary course of the business at least equal to the amount at which these have been stated in the Balance Sheet.

5. Balances of Sundry Creditors/Debtors are subject to confirmation/reconciliation, which in the opinion of the management is not significant, adjustments, if any will be carried out as and when settled. However accounts have been reconciled on the basis of materiality.

6. The company is a small and medium sized company as defined in the General Instruction in respect of Accounting Standard notified under the Companies Act, 1956. Accordingly, the Company has complied with the Accounting Standard as applicable to small and Medium Sized Company.

7. There is no contingent liability as Certified by the management of the company.

8. All the known liabilities have been provided for and there are no disputed liabilities asconfirmed by the management of the company.