Notes to Accounts of Vertex Securities Ltd.

Mar 31, 2025

2.17 PROVISIONS, CONTINGENT LIABILITIES AND CONTINGENT ASSETS

a) A provision is recognised when the Company has a present obligation as a result of a past event and it is probable
that an outflow of embodying economic benefits will be required to settle the obligation and there is a reliable
estimate of the amount of the obligation. Provisions are measured at the best estimate of the expenditure required
to settle the present obligation at the Balance sheet date. Provisions are determined by discounting the expected
future cash flows (representing the best estimate of the expenditure required to settle the present obligation at
the balance sheet date) at a pre-tax rate that reflects current market assessments of the time value of money and
the risks specific to the liability. Provisions are reviewed at each balance sheet date and adjusted to effect current
management estimates.

b) Contingent liability is a possible obligation arising from past events and whose existence will be confirmed only by
the occurrence or non-occurrence of one or more uncertain future events not wholly within the control of the entity
or a present obligation that arises from past events but is not recognised because it is not probable that an outflow
of resources embodying economic benefits will be required to settle the obligation or the amount of the obligation
cannot be measured with sufficient reliability. Contingent liabilities are not recognised but are disclosed in the notes.
Contingent liabilities are recognised when there is possible obligation arising from past events.

c) A contingent asset is a possible asset that arises from past events and whose existence will be confirmed only
by the occurrence or non-occurrence of one or more uncertain future events not wholly within the control of the
entity. The company does not have any contingent assets in the financial statements. Contingent assets are neither
recognised nor disclosed in the financial statements.

2.18 CASH FLOW STATEMENT

Cash flows are reported using the indirect method, whereby profit before tax is adjusted for the effects of transactions of
a non-cash nature and any deferrals or accruals of past or future cash receipts or payments. The cash flows from regular
revenue generating, investing and financing activities of the Company are segregated.

2.19 BORROWING COST

Borrowing cost includes interest, amoritsation of ancillary costs incurred in connection with the arrangement of borrowings
and exchange differences arising from foreign currency borrowings to the extent they are regarded as an adjustment to
the interest cost. Borrowing costs, if any, directly attributable to the acquisition, construction or production of an asset
that necessarily takes a substantial period of time to get ready for its intended use or sale are capitalised, if any. All other
borrowing costs are expensed in the period in which they occur.

2.20 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 paid, except when the tax incurred on a purchase
of assets or services is not recoverable from the tax 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.

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

2.21 STANDARDS ISSUED AND EFFECTIVE

Ministry of Corporate Affairs (“MCA”) had notified the Companies (Indian Accounting Standards) Amendment Rules,
2023 dated 31 March, 2023 to amend the following Ind AS which were effective from 01 April, 2023. However, these
amendments does not have an impact on Financial Statements and material accounting policy information.

Ind AS 1 - Presentation of Financial Statements - This amendment requires the entities to disclose their material
accounting policies rather than their significant accounting policies. The effective date for adoption of this amendment is
annual periods beginning on or after 01 April, 2023. The Company has evaluated the amendment and the impact of the
amendment is insignificant in the Company’s financial statements.

Ind AS 8 - Accounting Policies, Changes in Accounting Estimates and Errors - This amendment has introduced a definition
of accounting estimates’ and included amendments to Ind AS 8 to help entities distinguish changes in accounting policies
from changes in accounting estimates. The effective date for adoption of this amendment is annual periods beginning on
or after 01 April, 2023. The Company has evaluated the amendment and there is no impact on its financial statements.

Ind AS 12 - Income Taxes - This amendment has narrowed the scope of the initial recognition exemption so that it does
not apply to transactions that give rise to equal and offsetting temporary differences. The effective date for adoption of
this amendment is annual periods beginning on or after 01 April, 2023. The Company has evaluated the amendment and
there is no impact on its financial statement.

2.22 STANDARDS NOTIFIED BUT NOT YET EFFECTIVE

There are no standards that are notified and not yet effective as on the date.

2) Terms and rights attached to Shares.

1) The company has only one class of Equity share having a Par Value of Rs.2/- each. Each holder of equity share is entitled
for one vote per share. The company declares and pays dividend in Indian rupees. The dividend proposed by the Board of
Directors is subject to approval by the share holders in the ensuing Annual General Meeting.

2) In the event of liquidation of the company, the holder of equity shares will be entitled to receive remaining assets of the
company, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held
by the shareholders.

Note ‘26’ Segment Information

Disclosure under Indian Accounting Standard 108 - ‘Operating Segments’ is not given as, in the opinion of the management, the
entire business activity falls under one segment, viz. primarily engaged as stock and securities broker and providing the financial
services. The Company conducts its business only in one Geographical Segment, viz., India. Also there are no revenue from
transactions with a single external customer or counterparty amounted to 10% or more of the Company’s total revenue in the year
ended 31 March 2025 or 31 March 2024.

Note ‘27’ Employee benefits plan
Defined benefit plans
(A) Gratuity

The gratuity plan is governed by the Payment of Gratuity Act, 1972. Under the Gratuity Act, an employee who has completed five
years of service is entitled to specific benefits. The level of benefits provided depends on the member’s length of service, managerial
grade and salary at retirement age.

Discount Rate

Discount rate for this valuation is based on government bonds having similar term to duration of liabilities. Due to lack of a deep and
secondary bond market in India, government bond yields are used to arrive at the discount rate.

Mortality/Disability

If the actual mortality rate in the future turns out to be more or less than expected then it may result in increase / decrease in the
liability.

Employee Turnover/ Withdrawal Rate

If the actual withdrawal rate in the future turns out to be more or less than expected then it may result in increase / decrease in the
liability.

Salary Escalation Rate

More or less than expected increase in the future salary levels may result in increase / decrease in the liability.

The disclosures of employee benefits as defined in the Ind AS 19 ’’Employee Benefits” are given below:

(b) Lease commitments

The Company has obtained office premises under operating lease. These leases are for a period ranging from 11 to 60 months
and are renewable as may be mutually decided. These are generally cancellable lease. Lease payments recognised in the
Statement of Profit and Loss as ‘Rent’ under Note No. 24 is INR 9.53 lacs (P.Y. 11.75 lacs.).

Note ‘31’ Risk management
Liquidity risk

Ultimate responsibility for liquidity risk management rests with the board of directors, which has established Asset and Liability
Management Committee (ALCO) for the management of the Company’s short, medium and long term funding and liquidity
management requirements. The Company manages liquidity risk by maintaining adequate reserves, banking facilities and reserve
borrowing facilities, by continuously monitoring forecast and actual cash flows, and by matching the maturity profiles of financial
assets and liabilities. The Company also has line of Inter corporate deposits available from holding company & fellow subsidiary
companies within its group to meet any short term fund requirements.

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 equity price risk.

Interest rate risk

The Company uses a mix of cash and borrowings to manage the liquidity & fund requirements of its day to- day operations. Further,
certain interest bearing liabilities carry variable interest rates

The sensitivity analyses below have been determined based on exposure to financial instruments at the end of the reporting year.
For floating rate liabilities, analysis is prepared assuming the amount of liability outstanding at the end of the reporting year was
outstanding for the whole year. The following table demonstrates the sensitivity to a reasonably possible change in interest rates
on that portion of loans and borrowings affected.With all other variables held constant, the Company’s profit before tax is affected
through the impact on floating rate borrowings, as follows

Credit risk

Credit risk is the risk of financial loss the Company may face due to current/potential inability or unwillingness of a customer or
counterparty to meet financial/ contractual obligations. Credit risk also covers the possibility of losses associated with diminution
in the credit quality of counterparties. Inadequate collateral may also lead to financial losses in the event of default. The company
has adopted a policy of dealing with creditworthy counterparties and obtain sufficient collateral, where appropriate, as a means of
mitigating the risk of financial loss from defaults.

The maximum exposure to credit risk for each class of financial assets is the carrying amount of that class of financial instruments
presented in the financial statements.

Note ‘32’ Capital Management

The Company’s capital management strategy is to effectively determine, raise and deploy capital so as to create value for its
shareholders. The same is done through a mix of either equity and/or preference and/or combination of short term /long term debt
as may be appropriate.

The company’s objectives when managing capital are to:

• Safeguard their ability to continue as a going concern, so that they can continue to provide returns for shareholders and
benefits for other stakeholders, and

• Maintain an optimal capital structure to reduce the cost of capital.

Note ‘33’ Events after reporting date

There have been no events after the reporting date that require adjustment/disclosure in these financial statements.

Note ‘34’ Fair value hierarchy

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction in the principal (or
most advantageous) market at the measurement date under current market conditions (i.e., an exit price), regardless of whether that
price is directly observable or estimated using a valuation technique.

The Company has determined that the carrying values of cash and cash equivalents, bank balances, trade receivables, loans, trade
payables, borrowings other than debt securities and other current liabilities are a reasonable approximation of their fair value and
hence their carrying value are deemed to be fair value.

Fair value hierarchy

The Company determines fair values of its financial instruments according to the following hierarchy:

Level 1: Quoted prices (unadjusted) in active markets for identical assets and liabilities.

Level 2: inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly.
Level 3: inputs for the asset or liability that are not based on observable market data (unobservable inputs).

Reasons for Variance:

(a) Current Ratio- The increase in current ratio from 0.34 to 0.43 is primarily due to a relative increase in liquid current assets and
better liability management.

(b) Debt Equity Ratio- The debt-equity ratio increased from 0.28 to 0.36 primarily due to higher utilisation of bank overdraft facilities
to meet short-term working capital and settlement obligations.

(c) Interest Service Coverage Ratio- The interest coverage ratio declined from 0.28 to -0.09 primarily due to a reduction in operating
profits during the year, while finance costs remained largely consistent.

(d) Return on Capital employed- Return on Capital Employed decreased from 0.03 to -0.08 primarily due to a decline in operating
profitability during the year, while the capital employed remained at similar levels.

(e) Operating Profit Margin (%)- The operating profit margin declined from 4.37% to -8.95% primarily due to a significant increase
in operating expenses and a reduction in revenue during the year. This adverse movement reflects market-driven pressures
and fixed cost absorption challenges amid lower business volumes.

(f) Net Profit Margin (%)- The net profit margin declined from 4.52% to -8.95% due to reduced operating income and increased
expenses, including finance and administrative costs. The decline reflects adverse market conditions impacting overall
profitability during the year.

Note ‘41’ Relationship with Struck off Companies

The Company does not have any relationship with any of the Struck Off Companies whether under section 248 of the Companies
Act or Section 560 of Companies Act, 1956.

Note ‘42’ UNDISCLOSED INCOME

There are no transactions which are not recorded in the Books of Accounts that has been surrendered or disclosed as income during
the year in the tax assessments under the Income Tax Act, 1961 (such as, search or survey or any other relevant provisions of the
Income Tax Act, 1961). Further, there was no unrecorded income and related assets which are required to be recorded in the books
of accounts during the year.

Note ‘43’ NO OF LAYERS OF COMPANIES

The company has not made any default on No of layers of companies through which it has invested.

Note ‘44’

In order to ensure better comparability and alignment with the presentation of current year financial statements, certain figures for the
previous year have been regrouped and/or reclassified wherever necessary. These changes do not have any impact on the overall
financial performance or position as reported previously.

Note ‘45’ Corporate Social Responsibility (CSR)

The provisions of Corporate Social Responsibility (CSR) are not applicable to the company.

Note ‘46’ DETAILS OF CRYPTO CURRENCY OR VIRTUAL CURRENCY

The company has not traded or invested in Crypto Currency or Virtual Currency during the Financial Year.

For Deoki Bijay & Co For and on behalf of Board of Directors

Chartered Accountants
(FRN: 313105E)

CA Sushil Kumar Agrawal Kumar Nair Ramachandran Unnikrishnan

Partner Chairman Managing Director

Membership No.: 059051 DIN.00320541 DIN.00493707

George Mampillil

Director & CFO
DIN.01976386

Place: Kolkata Place: Kochi

Date: April 30, 2025 Date: April 30, 2025

---

Mar 31, 2024

a Term Loan taken from South Indian Bank is under the ‘Emergency Credit Line Guarantee Scheme’ (ECLGS) floated by GOI in the wake of COVID-19 pandemic, repayable in 36 months.

Hypothecated against the entire current assets of the Company as primary security and property owned by Transwarranty Finance Limited as a collateral security.

b Overdraft from South Indian Bank is Working Capital Facility secured against mortgage of property owned by Transwarranty Finance Limited,Corporate Guarantee of Holding Company and Personal Guarantee of the Chariman. The total limit allowed is 3.5 crores and the interest rate on the overdraft facility is 13.85%% pa.

a) Each Non - Cumulative Redeemable Preference Share shall be redeemable with in a period of 1 to 8 years from the date of issue i.e. 05/05/2014 as may be determined by the Board of Directors of the company at their absolute discretion. Preference share holders are entitled to get dividend only when the company has distributable profits. In the event of winding up or repayment of capital, Preference share holders have the preferential right to be repaid the amount of capital paid up.

The Company is in the process of redeeming its Non-Cumulative Redeemable Preference Share Capital as at the year end, out of such profits for previous years and accordingly a sum equal to the nominal amount of the shares to be redeemed have been transferred to Capital Redemption Reserve.

2) Terms and rights attached to Shares.

1) The company has only one class of Equity share having a Par Value of Rs.2/- each. Each holder of equity share is entitled for one vote per share. The company declares and pays dividend in Indian rupees. The dividend proposed by the Board of Directors is subject to approval by the share holders in the ensuing Annual General Meeting.

2) In the event of liquidation of the company, the holder of equity shares will be entitled to receive remaining assets of the company, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders.

Earnings per share (EPS)

Basic EPS is calculated by dividing the profit for the year attributable to equity holders of the Company by the weighted average number of equity shares outstanding during the year.

Diluted EPS is calculated by dividing the profit attributable to equity holders of the Company by the weighted average number of equity shares outstanding during the year plus the weighted average number of equity shares that would be issued on conversion of all the dilutive potential equity shares into equity shares of the Company.

Disclosure under Indian Accounting Standard 108 - ‘Operating Segments’ is not given as, in the opinion of the management, the entire business activity falls under one segment, viz. primarily engaged as stock and securities broker and providing the financial services. The Company conducts its business only in one Geographical Segment, viz., India. Also there are no revenue from transactions with a single external customer or counterparty amounted to 10% or more of the Company’s total revenue in the year ended 31 March 2024 or 31 March 2023.

Risk management Liquidity risk

Ultimate responsibility for liquidity risk management rests with the board of directors, which has established Asset and Liability Management Committee (ALCO) for the management of the Company’s short, medium and long term funding and liquidity management requirements. The Company manages liquidity risk by maintaining adequate reserves, banking facilities and reserve borrowing facilities, by continuously monitoring forecast and actual cash flows, and by matching the maturity profiles of financial assets and liabilities. The Company also has line of Inter corporate deposits available from holding company & fellow subsidiary companies within its group to meet any short term fund requirements.

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 equity price risk.

Interest rate risk

The Company uses a mix of cash and borrowings to manage the liquidity & fund requirements of its day to- day operations. Further, certain interest bearing liabilities carry variable interest rates

The sensitivity analyses below have been determined based on exposure to financial instruments at the end of the reporting year. For floating rate liabilities, analysis is prepared assuming the amount of liability outstanding at the end of the reporting year was outstanding for the whole year. The following table demonstrates the sensitivity to a reasonably possible change in interest rates on that portion of loans and borrowings affected. With all other variables held constant, the Company’s profit before tax is affected through the impact on floating rate borrowings, as follows

Credit risk

Credit risk is the risk of financial loss the Company may face due to current/potential inability or unwillingness of a customer or counterparty to meet financial/ contractual obligations. Credit risk also covers the possibility of losses associated with diminution in the credit quality of counterparties. Inadequate collateral may also lead to financial losses in the event of default. The company has adopted a policy of dealing with creditworthy counterparties and obtain sufficient collateral, where appropriate, as a means of mitigating the risk of financial loss from defaults.

The maximum exposure to credit risk for each class of financial assets is the carrying amount of that class of financial instruments presented in the financial statements.

The table below summarises the gross carrying values and the associated allowances for expected credit loss (ECL) stage wise for loan portfolio:

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction in the principal (or most advantageous) market at the measurement date under current market conditions (i.e., an exit price), regardless of whether that price is directly observable or estimated using a valuation technique.

The Company has determined that the carrying values of cash and cash equivalents, bank balances, trade receivables, loans, trade payables, borrowings other than debt securities and other current liabilities are a reasonable approximation of their fair value and hence their carrying value are deemed to be fair value.

Fair value hierarchy

The Company determines fair values of its financial instruments according to the following hierarchy:

Level 1: Quoted prices (unadjusted) in active markets for identical assets and liabilities.

Level 2: inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly. Level 3: inputs for the asset or liability that are not based on observable market data (unobservable inputs).

The Company’s capital management strategy is to effectively determine, raise and deploy capital so as to create value for its shareholders. The same is done through a mix of either equity and/or preference and/or combination of short term /long term debt as may be appropriate.

Note ‘36’ Events after reporting date

There have been no events after the reporting date that require adjustment/disclosure in these financial statements.

Note ‘37’

The Code on Social Security, 2020 (‘Code’) relating to employee benefits during employment and post-employment benefits received Presidential assent in September, 2020. The Code has been published in the Gazette of India. However, the date on which the Code will come into effect has not been notified and the final rules/interpretation have not yet been issued. The Company will assess the impact of the Code when it comes into effect and will record any related impact in the period the Code becomes effective.

(A) Where company has advanced or loaned or invested funds (either borrowed funds or share premium or any other sources or kind of funds) to any other person(s) or entity(ies), including foreign entities (Intermediaries) with the understanding (whether recorded in writing or otherwise) that the Intermediary shall

(I) date and amount of fund advanced or loaned or invested in Intermediaries with complete details of each Intermediary. Loans given Neterwala & VCFPL - Please provide details .

Where any proceedings have been initiated or pending against the company for holding any benami property under the Benami Transactions (Prohibition) Act, 1988 (45 of 1988) and the rules made thereunder, the company shall disclose the following:-

a. Details of such property, including year of acquisition,

b. Amount thereof,

c. Details of Beneficiaries,

d. If property is in the books, then reference to the item in the Balance Sheet,

e. If property is not in the books, then the fact shall be stated with reasons,

f. Where there are proceedings against the company under this law as an abetter of the transaction or as the transferor then the details shall be provided,

g. Nature of proceedings, status of same and company’s view on same.

Note ‘41’ Where the Company has borrowings from banks or financial institutions on the basis of security of current assets, it shall disclose the following:-

There are no Borrowings from Banks or Financial Institutions on the basis of security of current assets.

The Company does not have any relationship with any of the Struck Off Companies whether under section 248 of the Companies Act or Section 560 of Companies Act, 1956.

Note ‘47’ Wilful Defaulter

The company is not declared as Wilful Defaulter by any Bank or Financial Institution or any other lender.

Note ‘48’ Corporate Social Responsibility (CSR)

The provisions of Corporate Social Responsibility (CSR) are not applicable to the company.

Note ‘49’ DETAILS OF CRYPTO CURRENCY OR VIRTUAL CURRENCY

The company has not traded or invested in Crypto Currency or Virtual Currency during the Financial Year.

There are no transactions which are not recorded in the Books of Accounts that has been surrendered or disclosed as income during the year in the tax assessments under the Income Tax Act, 1961 (such as, search or survey or any other relevant provisions of the Income Tax Act, 1961). Further, there was no unrecorded income and related assets which are required to be recorded in the books of accounts during the year.

Note ‘51’ NO OF LAYERS OF COMPANIES

The company has not made any default on No of layers of companies through which it has invested.

---

Mar 31, 2015

1. Terms and rights attached to Shares.

A) Equity Shares.

The company has only one class of Equity share having a Par Value of Rs. 2/- each. Each holder of equity share is entitled for one vote per share. The company declares and pays dividend in Indian rupees. The dividend proposed by the Board of Directors is subject to approval by the share holders in the ensuing Annual General Meeting.

In the event of liquidation of the company, the holder of equity shares will be entitled to receive remaining assets of the company, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders.

2.0.5% Fully Convertible Preference Shares.

Each Fully Convertible Preference Share shall be compulsorily converted into five equity share of Rs. 2/- each fully paid up at par, at any time from the end of first year to the end of fifth year from the date of allotment.

Preference share holders are entitled to get dividend only when the company has distributable profits.

In the event of winding up or repayment of capital, Preference share holders have the preferential right to be repaid the amount of capital paid up.

3. 15%, Non Cumulative Redeemable Preference Shares.

Each Non Cumulative Redeemable Preference Share shall be redeemable with in a period of 1 to 8 years from the date of issue i.e. 05/05/2014 as may be determined by the Board of Directors of the company at their absolute discretion.

Preference share holders are entitled to get dividend only when the company has distributable profits.

In the event of winding up or repayment of capital, Preference share holders have the preferential right to be repaid the amount of capital paid up.

Figures as at Figures as at Particulars 31st March, 31st March, 2015 (Rs.) 2014 (Rs.)

4. CONTINGENT LIABILITIES

1. Counter guarantee issued in 15,000,000 11,900,000 favour of the banker for guarantee given by them to NSE for margin requirement Rs. 29.80 Mn. (P.Y. Rs. 29.80 Mn) and to BSE Rs. (Rs. P.Y. 0.2 Mn) for Margin requirment

2. Guarentee given on behalf of 5,000,000 30,000,000 subsidiary company Vertex Commodities & Finpro (P) Limited

3. Claims against the company not acknowledged as debts:- a. Tax demand in respect of:- Service Tax orders for FY 2006-07 to 2009-10 622,000 622,000

20,622,000 42,522,000

5. RELATED PARTY DISCLOSURES

As per Accounting Standard (AS-18) on Related Party Disclosures issued by the Institute of Chartered Accountants of India, the disclosure of transactions with the related party as defined in the Accounting Standard are given below:-

Name of the party Relation

Kumar Nair Chairman & Managing Director

Transwarranty Finance Holding Company Limited

Vertex Commodities and Subsidiary Company Finpro (P) Limited

Transwarranty Private Associated Company Limited (Until 16/12/2013)

Transwarranty Advisors Associated Company Private Limited

6. Sundry debtors include old outstanding debts amounting to Rs. 9,695,589/- (P.Y. Rs. 9,695,589) in respect of which Company has initiated legal and other recovery actions, the proceedings of which are in different stages of progress. No provision for doubtful debts has been made in the accounts during the year since the management is confident that the debts are good and recoverable.

7. In the opinion of Directors, the current assets and deposits have the value as stated in the Balance Sheet, if realized in the ordinary course of business.

8. The company is maintaining DEMAT beneficiary account with own Depository Services. The stock is transferred to the respective clients' accounts only when the company receives a written request from the clients and after confirming that they have enough credit / margin in their account.

9. Lien has been marked in favour of Axis bank in respect of Bank Deposits worth Rs. 15,000,000/- (P.Y Rs. 11,900,000/-) together with accumulated interest thereon, against bank guarantees issued by them on account of the Company. Lien has been marked in favour of BSE against trading guarantee in respect of Bank Deposit worth Rs. 1,000,000/- (P.Y. Rs. 1,000,000/-) together with accumulated interest thereon.

10. Based on the guiding principles given in Accounting Standard on "Segment Reporting" (AS - 17) issued by the Institute of Chartered Accountants of India, the Company's primary business segment is share broking. All other activities of the company revolve around the main business.

As the company's business activity falls within a single primary business segment, the disclosure requirements of AS - 17 in this regard are not applicable.

11. The management has evaluated the long term investments and confirms that there exists no circumstances which warrants further provision on account of permanent diminution in the value of investments.

12. No provision for dividend on Preference Shares and dividend tax there on has been made in the financial statement in the absence of distributable profits during the year.

a) The Company has vide resolution passed at the meeting of Board of Directors dated 11th October, 2011 and 16th January, 2012 decided to demerge its Merchant Banking division into a new company in the name and style of Transwarranty Capital Market Services Private Limited

b) As per the requirement of the Clause 24(f) of the Listing Agreement, company has made an application to the Bombay Stock Exchange Limited (BSE) which is pending for approval.

c) Appointed date of the proposed scheme of demerger is January 1, 2012 also the current financials of the company includes the financials of the Merchant Banking division.

13. The Company has revised depreciation rates on Fixed Assets effective 1st April, 2014 in accordance with requirements of Schedule II of Companies Act, 2013 ("the Act"). The remaining useful life of the Fixed Assets has been revised by adopting standard useful life as per new Companies Act 2013. The carrying amount of the Fixed Assets as on 1st April, 2014 is depreciated over the remaining useful life. As a result of this changes :-

The depreciation charge for the year ended 31st March, 2015 is higher by Rs. 11,24,024/-

There is a debit to retained earnings of Rs. 12,04,975/- Lakhs for the Fixed Assets whose remaining life as on 1st April, 2014 is expired in accordance with revised life as per Companies Act 2013.

14. Previous year figures have been re-grouped/reclassified/ re-arranged/recast wherever necessary to suit the current year's classification.

Previous year figures are, unless otherwise stated, given in bracket.

---

Mar 31, 2014

1) Terms and rights attached to Shares

A) Equity Shares

1) The company has only one class of Equity share having a Par Value of Rs.2/- each. Each holder of equity share is entitled for one vote per share. The company declares and pays dividend in Indian rupees. The dividend proposed by the Board of Directors is subject to approval by the share holders in the ensuring Annual General Meeting.

2) In the event of liquidation of the company, the holder of equity shares will be entitled to receive remaining assets of the company, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders.

B) 0.5% Fully Convertible Preference Shares.

1) Each Fully Convertible Preference Share shall be compulsorily converted into five equity share of Rs.2/- each fully paid up at par, at any time from the end of first year to the end of fifth year from the date of allotment.

2) Preference share holders are entitled to get dividend only when the company has distributable profits.

3) In the event of winding up or repayment of capital, Preference share holders have the preferential right to be repaid the amount of capital paid up.

C) 15%, Non Cumulative Redeemable Preference Shares.

1) Each Non Cumulative Redeemable Preference Share shall be redeemable with in a period of 1 to 3 year from the date of issue i.e. 19/05/2010 as may be determined by the Board of Directors of the company at their absolute discretion.

2) Preference share holders are entitled to get dividend only when the company has distributable profits.

3) In the event of winding up or repayment of capital, Preference share holders have the preferential right to be repaid the amount of capital paid up.

6) Employees Stock Option Scheme

a) The Vertex Employee Stock Option Plan 2010 has been approved by the Board Of Directors of the company on 10th March, 2008.

b) The vesting period is over five years from the date of grant, commencing after one year from the date of grant.

c) Exercise Period would commence one year from date of grant and will expire on completion of five years from the date of vesting.

d) The options will be settled in equity shares of the company.

e) The company used the intrinsic value method to account for ESOPs.

g) Consequently, no compensation cost has been recognized by the company in accordance with the Guidance Note on Accounting for Employee Share-Based payments issued by the Institute of Chartered Accountants of India.

i) Had fair value method been used, the compensation cost would have been higher by Rs.14.55 Lakhs (Previous Year Rs.21.44 Lakhs). Loss after tax would have been higher by Rs.113.61 Lakhs (Previous year Rs.21.44 Lakhs) and Basic EPS would have been Rs.(0.24 ) Per share (Previous Year Rs.(0.42) Per share) and Diluted EPS would have been Rs.(0.15) (Previous Year Rs.(0.25)).

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31st MARCH, 2014 (ALL AMOUNTS MENTIONED ARE IN RUPEES)

Particulars Figures as at Figures as at 31st March, 31st March, 2014 2013

NON-CURRENT LIABILITIES

4. LONG TERM BORROWINGS

A) SECURED Term Loans From Banks:-

-Vehicle Loan from HDFC Bank - 74,228

(Secured by hypothecation of vehicle - Motor Car-Skoda)

NOTE: The loan from HDFC was taken for purchase of Skoda Car, during the year 2010-11. The loan carried an interest rate @ 9.75% and is repayable in 60 installment. The loan is against hypothecation of the Car Purchased.

B) UNSECURED

a) Loans and Advances from Related Parties

Inter-Corporate Deposits - Holding 50,388,865 37,927,082 Company

Inter-Corporate Deposits - Others 5,195,196 -

b) Other Loans and Advances

- Security Deposit from Franchises 5,365,156 6,196,740 & Advances 60,949,217 44,198,050

5. OTHER LONG TERM LIABILITIES

a) Trade Payables Amount due to Clients 3,120,001 1,710,189 b) Others Other Creditors 610,842 769,608

3,730,843 2,479,797

CURRENT LIABILITIES

3. SHORT TERM BORROWINGS A) FROM BANKS SECURED

Overdraft Account - Catholic Syrian Bank - 5,929,010

(Secured Against Pledge / Lien of Fixed Deposit Nil (P.Y Rs.7,969,985/-) including interest)

B) FROM OTHERS UNSECURED

Inter Corporate Deposits 5,642,520 -

5,642,520 5,929,010

Particulars Figures as at Figures as at 31st March 31st March 2014 2013

4. CONTINGENT LIABILITIES

1. Counter guarantee issued in favour 11,900,000 17,000,000 of the banker for guarantee given by them to NSE for margin requirement

2. Guarentee given on behalf of 30,000,000 10,000,000 subsidiary company Vertex Commodities & Finpro (P) Limited

3. Claims against the company not acknowledged as debts:-

a. Tax demand in respect of which:- - 1,111,000 - Authority (Income Tax) for the Assessment Year 2007-08

- Service Tax orders for FY 2006-07 622,000 622,000 to 2009-10 42,522,000 28,733,000

5. Sundry debtors include old outstanding debts amounting to Rs. 9,695,589/- (P.Y. Rs. 10,435,972) in respect of which Company has initiated legal and other recovery actions, the proceedings of which are in different stages of progress. No provision for doubtful debts has been made in the accounts during the year since the management is confident that the debts are good and recoverable.

6. In the opinion of Directors, the current assets and deposits have the value as stated in the Balance Sheet, if realized in the ordinary course of business.

7. The company is maintaining DEMAT beneficiary account with own Depository Services. The stock is transferred to the respective clients'' accounts only when the company receives a written request from the clients and after confirming that they have enough credit / margin in their account.

8. Lien has been marked in favour of Axis bank in respect of Bank Deposits worth Rs.11,900,000/- (P.Y Rs.8,500,000/-) together with accumulated interest thereon, against bank guarantees issued by them on account of the Company. Lien has been marked in favour of BSE against trading guarantee in respect of Bank Deposit worth Rs.1,000,000/- (P.Y. Rs.Nil) together with accumulated interest thereon.

9. Based on the guiding principles given in Accounting Standard on "Segment Reporting" (AS - 17) issued by the Institute of Chartered Accountants of India, the Company''s primary business segment is share broking. All other activities of the company revolve around the main business. As the company''s business activity falls within a single primary business segment, the disclosure requirements of AS - 17 in this regard are not applicable.

10. The management has evaluated the long term investments and confirms that there exist no circumstances which warrant provision on account of permanent diminution in the value of investments.

11. No provision for dividend on Preference Shares and dividend tax there on has been made in the financial statement in the absence of distributable profits during the year.

12. a) The Company has vide resolution passed at the meeting of Board of Directors dated 11th October, 2011 and 16th January, 2012 decided to demerge its Merchant Banking division into a new company in the name and style of Transwarranty Capital Market Services Private Limited

b) As per the requirement of the Clause 24(f) of the Listing Agreement, company has made an application to the Bombay Stock Exchange Limited (BSE) which is pending for approval.

c) Appointed date of the proposed scheme of demerger is January 1, 2012 also the current financials of the company includes the financials of the Merchant Banking division.

13. Previous year figures have been re-grouped/reclassified/re-arranged /recast wherever necessary to suit the current year''s classification. Previous year figures are unless otherwise stated given in bracket.

---

Mar 31, 2013

1. Sundry debtors include old outstanding debts amounting to f 10,435,972/- (Rs. 10,370,458) in respect of which Company has initiated legal and other recovery actions, the proceedings of which are in different stages of progress. No provision for doubtful debts has been made in the accounts during the year since the management is confident that the debts are good and recoverable.

2. In the opinion of Directors, the current assets and deposits have the value as stated in the Balance Sheet, if realized in the ordinary course of business.

3. During the year the company has purchased and sold securities due to trade mistakes and failure of delivery of shares by clients. The profit or loss thus incurred along with other mistakes due to operational and communication problems are recognised under the head Operating Expenses as Error Rectification.

4. The company is maintaining DEMAT beneficiary account with own Depository Services. The stock is transferred to the respective clients'' accounts only when the company receives a written request from the clients and after confirming that they have enough credit / margin in their account.

5. Lien has been marked in favour of Axis bank in respect of Bank Deposits worth Rs. 8.5 Million (P.Y Rs. 5 Million) and in favour of HDFC Bank Rs. Nil (P.Y. Rs. 8.25 million) together with accumulated interest thereon, against bank guarantees issued by them on account of the Company.

6. Based on the guiding principles given in Accounting Standard on "Segment Reporting" (AS - 17) issued by the Institute of Chartered Accountants of India, the Company''s primary business segment is share broking. All other activities of the company revolve around the main business. As the company''s business activity falls within a single primary business segment, the disclosure requirements of AS - 17 in this regard are not applicable.

7. The management has evaluated the long term investments and confirms that there exist no circumstances which warrant provision on account of permanent diminution in the value of investments.

8. No provision for dividend on Preference Shares and dividend tax there on has been made in the financial statement in the absence of distributable profits during the year.

9. a) The Company has vide resolution passed at the meeting of Board of Directors dated 11th October, 2011 and 16th January, 2012 decided to demerge its Merchant Banking division into a new company in the name and style of Transwarranty Capital Market Services Private Limited.

b) As per the requirement of the Clause 24(f) of the Listing Agreement, company has made an application to the Bombay Stock Exchange Limited (BSE) which is pending for approval.

c) Appointed date of the proposed scheme of demerger is January 1, 2012 also the current financials of the company includes the financials of the Merchant Banking division.

10. Previous year figures have been re-grouped/reclassified/re-arranged/recast wherever necessary to suit the current year''s classification. Previous year figures are unless otherwise stated given in bracket.

---

Mar 31, 2012

1) Terms and rights attached to Shares.

A) Equity Shares.

1) The company has only one class of Equity share having a Par Value of Rs 2/- each. Each holder of equity share is entitled for one vote per share. The company declares and pays dividend in Indian rupees. The dividend proposed by the Board of Directors is subject to approval by the share holders in the ensuring Annual General Meeting.

2) In the event of liquidation of the company, the holder of equity shares will be entitled to receive remaining assets of the company, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders.

B) 0.5% Fully Convertible Preference Shares.

1) Each Fully Convertible Preference Share shall be compulsorily converted into five equity share of Rs 2/- each fully paid up at par, at any time from the end of first year to the end of fifth year from the date of allotment.

2) Preference share holders are entitled to get dividend only when the company has distributable profits.

3) In the event of winding up or repayment of capital, Preference share holders have the preferential right to be repaid the amount of capital paid up.

C) 15%, Non Cumulative Redeemable Preference Shares.

1) Each Fully Convertible Preference Share shall be redeemable with in a period of 1 to 3 year from the date of issue i.e. 19/05/2010

2) Preference share holders are entitled to get dividend only when the company has distributable profits.

3) In the event of winding up or repayment of capital, Preference share holders have the preferential right to be repaid the amount of capital paid up.

As per records of the company, including its register of share holders/ members and other declarations received from the shareholders regarding beneficial interest, the above represents both legal and beneficial ownership of shares.

The Company had issued and allotted 376,730 equity shares of Rs 2/- each on 16-01-2012, pursuant to Chapter VII of SEBI (Issue of Capital and Disclosure Requirements) Regulation, 2010 (ICDR) . Although the listing approval from BSE is received on 09-05- 2012 the above shares have been included in the above shareholding pattern.

1) Employees Stock Option Scheme

a) The "Vertex Employee Stock Option Plan 2010" has been approved bv the Board Of Directors of the company on 10th March, 2008.

b) The vesting period is over five years from the date of grant, commencing after one year from the date of grant.

c) Exercise Period would commence one year from date of grant and will expire on completion of five years from the date of vesting.

d) The options will be settled in equity shares of the company.

e) The company used the intrinsic value method to account for ESOPs.

i) Had fair value method been used , the compensation cost would have been higher by Rs 75.77 Lakhs (Previous Year Rs 89.37 Lakhs Loss after tax would have been higher by Rs 75.77 Lakhs (Previous year Rs 89.37 Lakhs) and Basic EPS would have been Rs (0.43) Per share (Previous Year Rs (1.92 ) Per share) and Diluted EPS would have been Rs (0.25) (Previous Year Rs (0.80)).

Particulars For the year ended For the year ended 31st March, 2012 31st March 2011 2 CONTINGENT LIABILITIES

1. Counter guarantee issued in favour of the banker for guarantee given by them to NSE for margin requirement 36,500,000 34,000,000

2. Guarantee given on behalf of subsidiary company Vertex Commodities & Finpro (P) Limited 50,000.000 60,000,000

3. Claims against the company not acknowledged as debts:-

a. Tax demand in respect of which:-

- Company's Appeal is pending before the first appellate Authority (Income Tax) for the Assessment Year 2007-08 1,111,000 1,111,000

- Service Tax orders for FY 2006-07 to 2009-10 622,000 497,000

88,233,000 95,608,000

3 Sundry debtors include old outstanding debts amounting to Rs 10,370,458 (Rs 11,790,892) in respect of which Company has initiated legal and other recovery actions, the proceedings of which are in different stages of progress. No provision for doubtful debts has been made in the accounts during the year since the management is confident that the debts are good and recoverable.

4 In the opinion of Directors, the current assets and deposits have the value as stated in the Balance Sheet, if realized in the ordinary course of business.

5 During the year the company has purchased and sold securities due to trade mistakes and failure of delivery of shares by clients. The profit or loss thus incurred along with other mistakes due to operational and communication problems are recognised under the head Operating Expenses as Error Rectification.

6 The company is maintaining DEMAT beneficiary account with own Depository Services. The stock is transferred to the respective clients' accounts only when the company receives a written request from the clients and after confirming that they have enough credit / margin in their account.

7 Lien has been marked in favour of ICICI Bank Ltd in respect of Bank Deposits worth Rs Nil (P.Y Rs 3.80 Million) and in favour of HDFC Bank t 8.25 million (P.Y. Rs 13.25) and in favour of Axis bank Rs 5 Million ( P.Y. Rs Nil) together with accumulated interest thereon, against bank guarantees issued by them on account of the Company.

8 Based on the guiding principles given in Accounting Standard on "Segment Reporting" (AS - 17) issued by the Institute of Chartered Accountants of India, the Company's primary business segment is share broking. All other activities of the company revolve around the main business. As the company's business activity falls within a single primary business segment, the disclosure requirements of AS - 17 in this regard are not applicable.

9 The management has evaluated the long term investments and confirms that there exist no circumstances which warrant provision on account of permanent diminution in the value of investments.

10 No provision for dividend on Preference Shares and dividend tax there on has been made in the financial statement in the absence of distributable profits during the year.

11 a) The Company has vide resolution passed at the meeting of Board of Directors dated 11th October, 2011 and 16th January, 2012 decided to demerge its Merchant Banking division into a new company in the name and style of Transwarranty Capital Market Services Private Limited

b) As per the requirement of the Clause 24(f) of the Listing Agreement, company has made an application to the Bombay Stock Exchange Limited (BSE) which is pending for approval.

c) Appointed date of the proposed scheme of demerger is January 1, 2012 also the currert financials of the company includes the financials of the Merchant Banking division.

12 Previous year figures have been re-grouped / reclassified / re-arranged / recast wherever necessary to suit the current year's classification. Previous year figures are unless otherwise stated given in bracket.

---

Mar 31, 2011

1. Some of the debtors, advances, creditors, and security deposit are subject to confirmation, reconciliation and adjustments if any. The management does not expect any material difference affecting the current years financial statements.

2. Sundry debtors include old outstanding debts amounting to Rs.11,790,892 (Rs.6,735,421) in respect of which Company has initiated legal and other recovery actions, the proceedings of which are in different stages of progress. No provision for doubtful debts has been made in the accounts during the year since the management is confident that the debts are good and recoverable.

3. In the opinion of Directors, the current assets and deposits have the value as stated in the Balance Sheet, if realized in the ordinary course of business.

4. During the year the company has purchased and sold securities due to trade mistakes and failure of delivery of shares by client,. The profit or loss thus incurred along with other mistakes due to operational and communication problems are recognised under the head Operating Expenses as Error Rectification.

5. The company is maintaining DEMAT beneficiary account with own Depository Services. The stock is transferred to the respective clients accounts only when the company receives a written request from the clients and after confirming that they have enouga credit / margin in their account.

6. Lien has been marked in favour of ICICI Bank Ltd in respect of Bank Deposits worth Rs. 3.80 million (P.Y Rs. 20 million) and i n favour of HDFC Bank Rs. 13.25 million (P.Y. Rs. Nil) together with accumulated interest thereon, against bank guarantees issued by them on account of the Company.

7. Based on the guiding principles given in Accounting Standard on "Segment Reporting" (AS - 17) issued by the Institute of Chartered Accountants of India, the Companys primary business segment is share broking. All other activities of the company revolve around the main business. As the companys business activity falls within a single primary business segment, the disclosure requirements of AS - 17 in this regard are not applicable.

8. Contingent Liabilities not provided for:

(Rs. In Lakhs) As at As at 31.03.2011 31.03.2010 Rs. Rs.

Particulars

i) Counter guarantee issued in favour of bankers for guarantee given by 340 410 them to NSE for margin requirements

ii) Guarantee given on behalf of subsidiary company Vertex Commodities 600 Nil & Finpro (P) Limited.

iii) Claims against the company not acknowledged as debt

a) Tax demand in respect of which:

i Companys appeal is pending before the first appellate Authority 11.11 11.11 (Income Tax) for the Assessment Year 2007-08

ii) Companys Service Tax appeal is pending before the CESTAT 4.97 4.97

b) Arbitration against the company pending in courts Nil 13.70

13. Information on related party transaction as required by Accounting Standard -18

(a) Name of the related parties and description of the relation:

Name of the Party Relation

Transwarranty Finance Limited Holding Company

Kumar Nair Chairman & Managing Director

Vertex Commodities & Finpro Private Limited. Subsidiary Company

Transwarranty Private Limited. Associated Company

Transwarranty Advisors Private Limited. Associated Company

Ashok Mittal Chief Executive Officer

9. The management has evaluated the long term investments and confirms that there exist no circumstances which warrant provision on account of permanent diminution in the value of investments.

10. Employe Stock Option Scheme

a) The "Vertex Employe Stock Option Plan,2010" has been approved by the Board Of Directors of the company on 10th March. 2008.

b) The vesting period is over five years from the date of grant, commencing after one year from the date of grant.

c) Exercise Period would commence one year from date of grant and will expire on completion of five years from the date of vesting.

d) The options will be settled in equity shares of the company.

e) The company used the intrinsic value method to account for ESOPs.

g) Consequently, no compensation cost has been recognized by the company in accordance with the "Guidance Note on Accounting for Employee Share-Based payments" issued by the Institute of Chartered Accountants of India.

i) Had fair value method been used, the compensation cost would have been higher by Rs.89.37 Lakhs (Previous Year Rs Nil) Loss after tax would have been higher by Rs.89.37 Lakhs (Previous year Rs.Nil) and EPS basic would have been Rs (1 92 ) Per share (Previous Year Rs.Nil )Per share and Diluted EPS would have been Rs.(0.80) Per share (Previous Year Rs Nil)

11. For the 27,758, 15% Non Cumulative Redeemable Preference shares of Rs.100/- each and 8,300,715, 0.5% fully convertible preference shares of Rs.10 each, no provision for dividend and dividend tax has been made in the financial statement in the absence of distributable profits during the year.

12. Previous year figures have been re-grouped/reclassified/ re-arranged/recast wherever necessary to suit the current years classification. Previous year figures are unless otherwise stated given in bracket.

---

Mar 31, 2010

1. Amalgamation with M/s. Transwarranty Capital Private Ltd.

The Company had entered into a Scheme of Amalgamation(Scheme) with M/s. Transwarranty Capital Private Ltd. (TCPL) for the amalgamation of TCPL with the Company effective April 1, 2009 (Appointed date). The Scheme was approved by the Honourable High Court of judicature at Bombay on 18.12.2009 and Honourable High Court of judicature at Kerala on 23 .02.2010.

Pursuant to the order of the Honourable High Courts, TCPL has been amalgamated with the Company and stands dissolved without being wound up.

The Assets and Liabilities of erstwhile TCPL who is engaged in the business of shares, derivatives, stock broking, depository services, merchant banking and distribution of Mutual funds, were transferred and vested in the Company w.e.f. the appointed date viz: 1st April, 2009 in accordance with the Scheme sanctioned by the High Courts. The Scheme has accordingly been given effect to in the accounts. Hence the accounts of the current year are not comparable with that of the previous year.

The amalgamation has been accounted for under the "The Purchase Method" as prescribed by Accounting Standard (AS-14: Accounting for Amalgamation) subject to the specific accounting treatment sanctioned by the High Courts. Accordingly the assets and liabilities of erstwhile TCPL as on 1st April 2009 has been taken over at their book values. The accumulated losses (Rs.78.95 Lakhs) of TCPL is deemed as loss of the Company. Further, 820,950 equity shares of Rs.10 each fully paid up and 8,300,715, 0.5% fully convertible preference shares of Rs.10/- each fully paid up was issued to the equity share holders of the erstwhile TCPL in exchange of 9,121,665 equity shares of Rs.10/- each fully paid up held by them in erstwhile TCPL. Further 31,500 equity shares of Rs.10/- each fully paid up and 318,500 0.5% fully convertible preference shares of RslO/- each fully paid up are pending to be issued to the equity share holders of the erst while TCPL in exchange of 350,000 equity shares of Rs 10/- each fully paid up held by them in erst while TCPL since approval from Department of Industrial Policy and Promotion is pending, the amount has been disclosed under "Share Capital Suspense Account" in schedule 1-A as of 31st March 2010.

The preference share holders of the erstwhile TCPL was issued 27,758, 5 year 15 % non cumulative redeemable preference shares of Rs.100/- each credited as fully paid up in exchange of equivalent number of 15% non cumulative redeemable preference shares held by them in TCPL.

The Company is providing depreciation on straight-line method at the rates prescribed in Schedule XIV to the Companys Act, 1956 where as, the erstwhile TCPL was providing depreciation on written down value method at the rates prescribed in Schedule XIV to the Companys Act 1956. In order to align with the accounting policy followed by the Company, depreciation on assets of the erstwhile TCPL till the amalgamation where recomputed under straight-line method at the rates prescribed in Schedule XIV to the Companys Act 1956 and a sum of Rs.1,100,569 is added along with the free reserves of the Company. The difference of Rs. 60.78 lakhs between the value of shares to be issued over the value of net assets taken over and loss adjusted is included under Reserves and Surplus as Reserve on Amalgamation Account.

As per The Purchase Method prescribed in AS-14, Accounting for Amalgamation, accumulated losses cannot be taken over by the Company. However as per Scheme approved by High Courts accumulated losses will be deemed to be loss of the Company Had the accounting treatment prescribed under the Purchase method in AS-14, Accounting for Amalgamation been followed there would be a goodwill of Rs.1,816,948/- as against present Reserve on Amalgamation Account amounting to Rs.6,078,890/-.

Final orders on the application to the SEBI for approval in connection with the amalgamation of TCPL with the Company is pending as on date.

4. Foreign Exchange Transaction:

Earnings in foreign currency - Nil Nil

Expenditure in foreign currency - Nil Nil,

5. Some of the debtors, advances, creditors, and security deposit are subject to confirmation, reconciliation and adjustments if any 1 he management does not expect any material difference affecting the current years financial statements.

6. Sundry debtors include old outstanding debts amounting to Rs.67,35,421.19 (P.Y. Rs.67,62,691.79) in respect of which Company has initiated legal and other recovery actions, the proceedings of which are in different stages of progress. No provision for doubtful debts has been made in the accounts during the year since the management is confident that the debts are good and recoverable. °

7. In the opinion of Directors, the current assets and deposits have the value as stated in the Balance Sheet, if realized in the ordinary course of business.

8. During the year the company has purchased and sold securities due to trade mistakes and failure of delivery of shares by clients The profit or loss thus incurred along with other mistakes due to operational and communication problems are recognised under the head Operating Expenses as Error Rectification.

9. The company is maintaining DEMAT beneficiary account with own Depository Services. The stock is transferred to the respective clients accounts only when the company receives a written request from the clients and after confirming that they have enough credit / margin in their account.

10. Lien has been marked in favour of ICICI Bank Ltd in respect of Bank Deposits worth Rs.200 Lakhs (P.Y. Rs. 200 Lakhs) and in favour of Federal Bank for Rs.5 lakhs (P.Y. Nil) together with accumulated interest thereon, against bank guarantees issued by them on account of the Company.

11. Based on the guiding principles given in Accounting Standard on "Segment Reporting" (AS - 17) issued by the Institute of Chartered Accountants of India, the Companys primary business segment is share broking. All other activities of the company revolve around the main business. As the companys business activity falls within a single primary business segment, the disclosure requirements of AS - 17 in this regard are not applicable.

12. Contingent Liabilities not provided for:

(Rs. In Lakhs) Particulars As at As at 31.03.2010 31.03.2009 Rs. Rs.

i) Counter guarantee issued in favour of bankers for guarantee given by 410 400 them to NSE for margin requirements

ii) Guarantee given on behalf of subsidiary company Vertex Commodities Nil 100 & Finpro (P) Ltd.

iii) Claims against the company not acknowledged as debt

1. Tax demand in respect of which:

a) Tax authorities appealed before Income Tax Appellate Tribunal Nil 69.32 against the orders which were ruled in favour of the company by the First Appellate Authority for the Assessment years -2005-06

b) Companys appeal is pending before the first appellate Authority 11.11 Nil (Income tax) for the assessment year 2007-08

c) Companys Service Tax appeal is pending before the CESTAT 4.97 Nil

2. Arbitration against the Company pending in courts 13.70 10.04

13. Information on related party transaction as required by Accounting Standard -18

(a) Name of the related parties and description of the relation:

Name of the Party Relation

Ranjan Verghese Managing. Director

Geetha Verghese Relative of the Managing Director

Transwarranty Finance Ltd Holding Company

Transwarranty Capital (P) Ltd Amalgamating Company (Previous year Subsidiary to Holding Company)

Transwarranty Advisors(P) Ltd. Company controlled by Directors/ Relatives

Transwarranty Private Ltd. Company controlled by Directors/ Relatives

Kumar Nair Chairman

Vertex Commodities & Finpro Private Ltd. Subsidiary Company

14. The management has evaluated the long term investments in Nawani Corp (India) Limited and Cochin Stock Exchange Limited and confirms that there exist no circumstances which warrant provision on account of permanent diminution in the value of investments.

21. Previous year figures have been re-grouped/reclassified/re-arranged/ recast wherever necessary to suit the current years classification.

Previous year figures are unless otherwise stated given in bracket.