Notes to Accounts of Franklin Leasing & Finance Ltd.

Mar 31, 2024

Provisions and Contingent Liabilities

A provision is recognized when the company has a present obligation as a result of past event, it is probable that an outflow of resources
embodying economic benefits will be required to settle the obligation and a reliable estimate can be made of the amount of the
obligation.These estimates are reviewed at each reporting date and adjusted to reflect the current best estimates.A contingent liability is
a possible obligation that arises from past events whose existence will be confirmed by the occurrence or non-occurrence of one or more
uncertain future events beyond the control of the company or a present obligation that is not recognized because it is not probable that
an outflow of resources will be required to settle the obligation. There is no contingent liability as at 31st March, 2024.

Segment Reporting

The company operates in segments of investment in securities and extending financial loan services, which are considered by the
management as a single segment for reporting purposes in order to analyse risk-return fundamentals based on internal organisational
structure.

33 The previous year''s figures have been reworked, regrouped, rearranged and reclassified wherever necessary. Amounts and other
disclosures for the preceding year are included as an integral part of the current year financial statements and are to be read in
relation to the amounts and other disclosures relating to the current year.

The company has a risk management committee which has the responsibility to identify the risk and suggest the
management the mitigation plan for the identified risks in accordance with the risk management policy of the
Company. The risk management policies are established to ensure timely identification and evaluation of risks,
setting acceptable risk thresholds, identifying and mapping controls against these risks, monitor the risks and their
limits, improve risk awareness and transparency.

These risks include market risk (including currency risk, interest rate risk and other price risk), credit risk and
liquidity risk. The Company seeks to minimise the effects of these risks by using derivative financial instruments,
credit limit to exposures, etc., to hedge risk exposures.

(i) Market risk

Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of
changes in market prices. Market prices comprise three types of risk: foreign currency risk, interest rate risk,
investment risk.

(ii) Interest rate risk

Arising from:

Interest rate risk stems from movements in market factors, such as interest rates, credit spreads which impacts
investments, income and the value of portfolios.

Measurement,monitoring and management of Risk:

Interest rate risk is measured, monitored by assessment of probable impacts of interest rate sensitivities under
stimulated stress test scenarios given range of probable interest rate movements on both fixed and floating assets
and liabilities.

(iii) Liquidity risk management

The Board of Directors of the Company has an overall responsibility and aversight for the management of all the
risks, including liquidity risk, to which the Company is exposed to in the course of conducting its business. The
Board approves the governance structure, policies, strategy and the risk limits for the management of liquidity
risk. The Board of Directors approves the constitution of the Risk Managament Committee (RMC) for the effective
supervision, evaluation, monitoring and review of various aspects and types of risks, including liquidity risk, faced
by the Company. The meetings of RMC are held at quarterly interval, Further, the Board of Directors also
approves constitution of Asset Liability Committee (ALCO), which functions as the strategic decision-making body
for tha asset-liability management of the Company from risk-return perspective and within the risk appetite and
guard- rails approved by the Board. The main objective of ALCO Is 10 assist the Board and RMC in effective
discharge of the responsibilities of asset liability management, markst risk management, ilquidity and interest rate
risk management and also to ensure adherence to risk tolerance/limits set up by the Board. ALCO provides
guidance and directions In terms of Interest rate, liquidity, funding sources, and investment of surplus funds. ALCO
meetings are held once In a month or more frequently as warranted from time to time. The minutes of ALCO
meetings are placed before the RMC and the Board of Directors In its next meeting for its perusal/ approval/
ratification.

Arising from:

Liquidity risk arises from mismatches in the timing of cash flows, whereas funding risk arises when long term
assets cannot be funded at the expected term resulting in cashflow mismatches.

Measurement,monitoring and management of Risk:

Liquidity and funding risk is measured by identifying gaps in the structural and dynamic liquidity
statements.Monitored by assessment of the gap between visibility of funds and the near term liabilities given
under current liquidity conditions and evolving regulatory directions for NBFCs.

Maturity profile of financial liabilities:

The table below provides details regarding the remaining contractual maturities of financial liabilities at the
reporting date.

(iv) Credit risk management
Arising from:

Credit risk is the risk of financial loss arising out of a customer or counterparty failing to meet their repayment
obligations to the company.

Measurement,monitoring and management of Risk:

Credit risk is measured as the amount at risk due to repayment default of a customer or counterparty to the
Company. Various matrics such as EMI default rate, overdue position, collection efficiency, customers non
performing loans, etc. are used as leading indicators to access credit risk.

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Mar 31, 2018

1. Basis of preparation

The financial statements of the company have been prepared in accordance with generally accepted accounting principles (Indian GAAP) and the provisions of the Companies Act 2013.

The financial statements have been prepared on accrual basis and under the historical cost convention. The accounting policies not specifically referred, are consistently applied from the past accounting periods

a. Terms and rights attached to equity shares The company has issued only one class of equity share having a par value of Rs. 10 per share. Each holder of equity shares is entitled to vote per share. The company declares and pays dividend if any, in Indian Rupees. The dividend proposed by the Board of Directors is subject to approval of the shareholders in the ensuing Annual General Meeting.

In the event of liquidation of the company, the holders of equity shares will be entitled to receive remaining assets of the company, after distribution of the entire preferential amount. The distribution will be in proportion to the number of equity shares held by the shareholder.

2. There is no Micro, Small and Medium Enterprises as defined under Micro, Small & Medium Enterprises Development Act, 2006 to which Company owes dues which are outstanding for a period more than 45 days as on Balance Sheet Date.

The above information regarding Micro, Small and Medium Enterprises has been determined on the basis of information availed with the Company and has been duly relied by the auditors of the Company.

3. Provisions of Accounting Standard (AS) - 17 issued by the ICAI on ‘Segment Reporting’ are not been applicable to the Company.

4. In view of present uncertainty regarding generation of sufficient future income, net deferred tax asset or liability has not been recognized in these accounts on prudent basis.

5. In the opinion of the management, the current assets, loans and advances have a realizable value in the ordinary course of business is not less than the amount at which they are stated in the Balance Sheet.

6. Related party disclosures/ transactions

There is no transaction entered with the related party covered by the Accounting Standard (AS) - 18 on ‘Related Party Disclosure’ during the period covered by these financial statements.

7. Balance shown under head Sundry Debtors, Creditors and Advances are subject to confirmation._

8. Quantitative Information in respect of Opening Stock, Purchases, Sales and Closing Stock pursuant to Schedule VI of the relevant Companies Act are not applicable.

9. The company is listed with the Bombay Stock Exchanges Ltd. With effect from 9^th April, 2016 and respective stock code is 539839

10. Previous Year’s Figures have been re- arranged or re- grouped wherever considered necessary.

11. Figures have been rounded off to the nearest rupees. Figures in brackets indicate negative (-) figures.

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Mar 31, 2016

1. There is no Micro, Small and Medium Enterprises as defined under Micro, Small & Medium Enterprises Development Act, 2006 to which Company owes dues which are outstanding for a period more than 45 days as on Balance Sheet Date.

The above information regarding Micro, Small and Medium Enterprises has been determined on the basis of information availed with the Company and has been duly relied by the auditors of the Company.

2. Provisions of Accounting Standard (AS) - 17 issued by the ICAI on ''Segment Reporting'' are not been applicable to the Company.

3. In view of present uncertainty regarding generation of sufficient future income, net deferred tax asset or liability has not been recognized in these accounts on prudent basis.

4. In the opinion of the management, the current assets, loans and advances have a realizable value in the ordinary course of business is not less than the amount at which they are stated in the Balance Sheet.

5. Related party disclosures/ transactions

There is no transaction entered with the related party covered by the Accounting Standard (AS) - 18 on ''Related Party Disclosure'' during the period covered by these financial statements.

6. Balance shown under head Sundry Debtors, Creditors and Advances are subject to confirmation.

8. Quantities Information in respect of Opening Stock, Purchases, Sales and Closing Stock pursuant to Schedule VI of the relevant Companies Act are not applicable.

9. The company is listed with the Bombay Stock Exchanges Ltd. With effect from 9th April, 2016 and respective stock code is 539839.

10. Previous Year''s Figures have been re- arranged or re- grouped wherever considered necessary.