Notes to Accounts of Mercantile Ventures Ltd.

Mar 31, 2025

1.13 Provisions, Contingent Liabilities and Contingent Assets (Ind AS 37)

Provisions

Provisions are recognized when the Company has a present legal or constructive obligation as a result of a past event, it
is probable that an outflow of resources will be required to settle the obligation, and a reliable estimate can be made of the
amount of the obligation.

The amount of a provision is the best estimate of the expenditure expected to be required to settle the present obligation at
the reporting date. Provisions are not recognized for future operating losses.

Where the effect of the time value of money is material, provisions are discounted using a pre-tax discount rate that reflects
current market assessments of the time value of money and the risks specific to the obligation.

Contingent Liabilities

A contingent liability is 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. A present obligation that arises from past events but is not recognized because:

It is not probable that an outflow of resources will be required; or

The amount of the obligation cannot be measured with sufficient reliability.

Contingent liabilities are not recognized but are disclosed in the notes to the financial statements unless the possibility of an
outflow is remote.

Contingent Assets

A contingent asset is disclosed where an inflow of economic benefits is probable, but not recognized until the realization
of income is virtually certain. When the inflow of benefit becomes virtually certain, the asset is recognized in the financial
statements.

1.14 Segment Reporting (Ind AS 108)

The Company operates in one primary business segment: Sale of Services and hence they are identified as reportable
segments in accordance with Ind AS 108 - Operating Segments.

Sale of Services: This segment includes the provision of Renting of property and related services,Manpower supply services,
and Facilities management services. The revenue under this segment is derived from contracts for rental and related services
provided to clients.

Measurement and Reporting

• Segment revenue, segment expenses, and segment results include respective amounts directly attributable to each
segment and a portion of common costs allocated on a reasonable basis.

• Segment assets and liabilities are reported only to the extent they are regularly provided to the CODM.

• The accounting policies used for segment reporting are consistent with those followed in the preparation of the financial
statements.

Disclosures relating to segment revenue, profit/loss, assets, and liabilities are made in the notes to accounts, along with
reconciliations as required under Ind AS 108.

1.15 Financial Instruments: (Ind AS 109)

Initial Recognition

The Company recognizes financial assets and financial liabilities when it becomes a party to the contractual provisions of
the instrument. Financial assets and liabilities are initially measured at fair value. For instruments not measured at fair value
through profit or loss, transaction costs directly attributable to acquisition or issue are added to the carrying amount on initial
recognition.

Subsequent Measurement

Financial Assets at Amortized Cost: Includes trade receivables, loans and advances, and other receivables. These are
measured at amortized cost using the effective interest method, where applicable. Financial Liabilities at Amortized Cost:
Includes borrowings, trade payables and other financial obligations.

Financial assets at fair value through other comprehensive income:

A financial asset is subsequently measured at fair value through other comprehensive income if it is held within a business
model whose objective is achieved by both collecting contractual cash flows and selling financial assets 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.

The Company has made an irrevocable election for its investments which are classified as equity instruments to present the
subsequent changes in fair value in other comprehensive income based on its business model. Further, in cases where the
Company has made an irrevocable election based on its business model, for its investments which are classified as equity
instruments, the subsequent changes in fair value are recognized in other comprehensive income.

Financial assets at fair value through profit or loss:

A financial asset which is not classified in any of the above categories are subsequently fair valued through profit or loss.
Impairment of Financial Assets

The Company applies the Expected Credit Loss (ECL) model for impairment of financial assets as per Ind AS 109. However,
in practice, the following simplified approach is used:

Trade Receivables (Sundry Debtors):

A provision for expected credit losses is recognized at 10% of the outstanding balance for receivables that are outstanding
for more than 2 years based on historical default rates and management''s assessment.

Loan Receivables:

Similar to trade receivables, a 10% provision is made on loans receivable that remain outstanding for more than 2 years,
considering credit risk and recovery experience.

No ECL is recognized on other financial assets due to their low credit risk and immaterial nature.

This approach is reviewed periodically by management to ensure reasonableness.

Derecognition

Financial Assets: Derecognized when contractual rights to receive cash flows expire or are transferred without retaining
control or substantial risks and rewards.

.16 Critical accounting estimates

(a) Revenue recognition: (Ind AS 115 - Revenue from Contracts with Customers)

Revenue is recognized upon the completion of services to customers in an amount that reflects the consideration the
Company expects to receive in exchange for those services. The Company applies the five-step model under Ind AS 115 to
recognize revenue:

• Identify the contract with the customer

• Identify the performance obligations

• Determine the transaction price

• Allocate the transaction price to performance obligations

• Recognize revenue when (or as) performance obligations are satisfied

(b) Expenditure:

Expenses are accounted on accrual basis and provisions are made for all known losses and liabilities.

• Sale of Services - Renting of property, Manpower Services and Facilities Management services

Revenue from the abovementioned services is recognized over time as the performance obligation is fulfilled, based on the
terms of the rental and service agreement with the customer. The output method (e.g., time elapsed, milestones) is used to
measure progress towards complete satisfaction of the performance obligation. Revenue is recognized on an accrual basis
in accordance with the contract terms, provided that control of the service has been transferred to the customer and recovery
of consideration is probable.

• Other Income

Interest Income: Recognized using the Effective Interest Rate (EIR) method in accordance with Ind AS 109 - Financial
Instruments. This includes interest earned on fixed deposits and other interest-bearing instruments.

.17 Rounding of amounts

All amounts disclosed in the financial statements and notes have been rounded off to the nearest lakh as per the requirement
of Schedule III, unless otherwise stated.

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Mar 31, 2024

The Company has a Group Gratuity Policy with LIC for payment gratuity under the Payment of Gratuity Act, 1972. Employees who are in continuous service for a period of 5 years are eligible for gratuity. The amount of gratuity payable on retirement/ termination is based on the employees last drawn basic salary per month computed proportionately for 15 days salary multiplied for the number of years of service. The company has adopted a Group Gratuity Scheme for Employees with Life Isurance Corporation of India.The company makes contributions to Employees Gratuity Trust which has taken a Group Gratuity policy with LIC.. The Below Mentioned Disclosure is as given based on Gratiuity report provide by Life insurance corporation of India:

Segment reporting

The companies reportable segments under IND AS 108 are as follows:

1) Rent and Maintenance of immovable properties

2) Manpower Services

3) Investment activities

The following is an analysis of the company''s revenue and results from operations by reportable segments

For the purpose of monitoring segment performance and allocating resources between segments:

1) All assets are allocated to reportable segments as applicable

2) All liabilities are allocated to reportable segments as applicable

i The figures for the previous year have been regrouped / reclassified wherever necessary.

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Mar 31, 2018

a) The fair value of property have been used as deemed cost as on the date of transition as per IND AS101

b) The fair value of investments have been used as deemed cost as on the date of transition as per IND AS101

c) Discounting of long term liabilities under IND AS resulted in reversal of liabiliites.Interest expenses is recognised on the liability component over the tenure of the liability

d) Under IND AS 109 Convertible preference Shares are treated as Compound Financial Instruments .The discounted value is treated as financial liability forming part of borrowings while the Equity component forms part of other equity.

d). Total comprehensive income reconciliation:

Note: The following adjustments have been made to arrive at the comprehensive income under IND AS:

a) Discounting of long term liabilities resulted in reduction of liabiliites. Interest expenses is recognised on the liability component of convertible preference shares over the tenure of the liability.

Interest expense is recognised on the liability component of Convertible preference Shares treated as compund Financial Instruments

b) The fair value of property have been used as deemed cost which resulted in change of depreciation on such asets

c) The investment in equity instruments have been fair valued

d) The preference Dividend income has been recognised based on contractual entitlement Cash Flow statement:

There were no significant reconciliation items between cash flows prepared under IGAAP and those prepared under IND AS

1. As per Accounting Standard 18, the disclosures of transactions with the related parties are given below: Related Parties:

Subsidiaries:

Oasis Ventures Private Limited

i3 Security Private Limited

Rayce Electronic Intelligence India Private Limited

Associate:

National Trust Housing Finance Limited Key Managerial Personnel:

Mr. E.N. Rangaswami, Whole-time Director

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Mar 31, 2016

1 Term Loan has been availed against hypothecation charge on rental receivables from tenants occupying company''s office space and mortgage on 46118 sq. ft. of office space of the company in Chennai.

2 Zero interest 3 year Convertible Bonds issued to the Creditors of the company on 27 March 2013 in pursuance of a Scheme of Arrangement with the Creditors approved by the Hon''ble Madras High Court matured for payment on 27 March 2016. Bonds having a maturity value of Rs 182.80 lakhs have been redeemed on the due date as per the option exercised by the bond holders. The company has not received any response from the other bondholders. Reminder letters have been sent.

3 Other payables include unpaid zero interest convertible bonds of Rs. 42.00 lakhs (Please refer note 5.2 above)

4 Allotment of shares by India Radiators Limited is subject to approval of the revival scheme by the Board of Industrial and Financial Reconstruction

5 Investments written off during the year aggregate Rs110.16 lakhs

6 Capital Advances represent advances made towards purchase of immovable properties and fixed assets

7 The Non-Current assets relate to the balances of old NBFC business.

8 Details of Inter corporate Deposits disclosed pursuant to Section 186(4) of the Companies Act, 2013

9 The profit on sale of fixed assets represents profit arising from sale of immovable properties belonging to the Company.

10 Expenditure in foreign currency during the current period NIL NIL

11 Earnings in foreign exchange received during the current period NIL NIL

12 As per Accounting Standard 18, the disclosures of transactions with the related parties are given below:

Related Parties:

Subsidiaries:

Oasis Ventures Private Limited

i3 Security Private Limited

Rayce Electronic Intelligence India Private Limited

Associates:

Navia Markets Limited

National Trust Housing Finance Limited

Key Managerial Personnel:

Mr. E.N. Rangaswami, Whole-time Director

13. The figures for the previous year have been regrouped / reclassified wherever necessary.

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Mar 31, 2015

1. Term Loan has been availed against hypothecation charge on rental receivables from tenants occupying company's office space and mortgage on 46118 sq. ft. of office space of the company in Chennai.

2. Zero interest 3 year Convertible Bonds were issued to the Creditors of the company on 27 March 2013 in pursuance of a Scheme of Arrangement with the Creditors approved by the Hon'ble Madras High Court. The Bonds are redeemable at the end of the third year from the date of issue or in lieu of such redemption, at the option of the Creditors, convertible into equity shares of Rs. 10/- each par.

3. Allotment of shares by India Radiators Limited is subject to approval of the revival scheme by the Board of Industrial and Financial Reconstruction

5. Investments in equity shares of National Trust Housing Finance Ltd are yet to be transferred in the name of the company

6. Capital Advances represent advances made towards purchase of immovable properties and Fixed Assets

7. The Non-Current assets relate to the balances of old NBFC business. The Management is in the process of reviewing the prospects of further realisations from the above balances and appropriate decision will be taken in the ensuing year.

8. Details of Inter corporate Deposits disclosed pursuant to Section 186(4) of the Companies Act, 2013

Edac Engineering Ltd 2862.59

Greenstar Fertilizers ltd 700.00

The above Inter Corporate Deposits were utilised for the business purposes of the recipient companies

The above disclosure was not applicable for the previous year

9. The profit on sale of fixed assets represents profit arising from sale of immovable proeprties belonging to the company.

10. Expenditure in foreign currency during the current period NIL

11. Earnings in Foreign Exchange received during the current period NIL

12. As per Accounting Standard 18, the disclosures of transactions with the related parties are given below: Related Parties:

Subsidiaries:

Oasis Ventures Private Limited

i3 Security Private Limited

Rayce Electronic Intelligence India Private Limited

Associate:

Navia Markets Limited

Key Managerial Personnel:

Mr. E.N. Rangaswami, Whole-time Director

Mr.V.Padmanabha Sarma,Chief Financial Officer

Ms.S.Aarthi,Company Secretary

13. The figures for the previous year have been regrouped / reclassified wherever necessary.

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Mar 31, 2014

The accounting period for the previous period is from 15-11-2012 to 31-3 2013. Hence the figures are not comparable.

2.1. Zero Interest 3 year Convertible Bonds were issued to the Creditors of the company in pursuance of a Scheme of Arrangement with the Creditors approved by the Hon''ble Madras High Court.The Bonds are redeemable at the end of the third year from the date of issue or in lieu of such redemption, at the option of the Creditors, convertible into equity Shares of Rs 10 each at par.

Notes:

1 Deletions to Fixed Assets relate to disposal of immovable properties during the financial year.

2 Capital work-in-progress represents the company''s entitlement to certain residential units in a freehold land belonging to the company.

2.1 3,60,000 shares in Karuturi Floritech Ltd which are held at a cost of Rs 9.00 lakhs are partly paid up.

2.2 Cost of quoted shares include Rs 3.35 lakhs being the cost of shares held in third party names.

2.3 Oasis Ventures Private Limited became a wholly owned subsidiary on its incorporation on 4-11-2013.

2.4 Allotment of shares by India Radiators Limited is subject to approval of the revival scheme by the Board of Industrial and Financial Reconstruction.

3.1 The profit on sale of fixed assets represents profit arising from sale of immovable properties and transfer of 75% of undivided share of freehold land belonging to the company in terms of a Joint Venture Agreement entered in to with a Developer.

3.2 After a review of the balances in Non-current Assets relating to old NBFC business, an amount of Rs.6118.62 lakhs which are considered irrecoverable have been written off during the year.

4 Expenditure in foreign currency during the current year - Nil -

5 Earnings in foreign exchange received during the current year - Nil -

6 As per Accounting Standard 18, the disclosures of transactions with the related parties are given below:

Related Parties:

Subsidiaries:

Oasis Ventures Private Limited i3 Security Private Limited

Associates:

Armenian Investments Ltd Elliot Investments Ltd Everest Investments Ltd Harrington Investments Ltd Pantheon Investments Ltd Ripon Investments Ltd Success Investments Ltd Windsor Investments Ltd

Key Managerial Personnel:

Mr.E N Rangaswami, Whole-time Director The following are transactions & Closing Balances with the related parties during current year

Transaction with related parties during the year 2013-14

1. Write off of amounts due:

Everest Investments Ltd - Rs.1001.10 lakhs

Harrington Investments Ltd - Rs,. 61.00 lakhs

2. Security charges paid to M/s. 3 Security Private Limited - Rs.3.67 lakhs

3. Director''s Remuneration - Mr E N Rangaswami Rs.19.35 lakhs

7. Commitments on capital account and not provided for Rs. 3558.38 Lakhs

8. Dividend receivable on Preference Shares Rs 88.13 lakhs

9. The figures for the previous period have been regrouped reclassified wherever necessary.