COMPANY OVER VIEW

The Company is public limited company incorporated and domiciled in India having its registered office at Gurgaon,India. The Company is a non-banking finance company (without accepting or holding public deposits) registered with Reserve Bank of India. The equity shares of the Company are listed at Bombay Stock Exchange and National Stock Exchange in India.

1. SIGNIFICANT ACCOUNTING POLICIES

1.1 BASIS OF PREPRATION OF FINANCIAL STATEMENTS: -

These financial statements are prepared in accordance with Indian Generally Accepted Accounting Principles (GAAP) under the historical cost convention on the accrual basis. GAAP comprises mandatory accounting standards as prescribed under Section 133 of the Companies Act,2013 (‘Act’) read with Rule7 of the Companies (Accounts) Rules,2014 the provisions of the Act (to the extent notified),guidelines issued by Reserve Bank of India and guidelines issued by the Securities and Exchange Board of India (SEBI) . Accounting policies have been consistently applied except where a newly issued accounting standard is initially adopted or are vision to an existing accounting standard requires a change in the accounting policy hitherto in use.

1.2 USE OF ESTIMATES

The preparation of financial statements in conformity with generally accepted accounting principles (GAAP) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosures of contingent liabilities on the date of financial statements and reported amounts of revenue and expenses for that year. Actual results could differ from these estimates. Any revision to accounting estimates is recognized prospectively in current and future periods.

1.3 REVENUE RECOGNITION

1.3.1 All Income & Expenditure are accounted for on accrual basis.

1.3.2 Shares/Securities are capitalized at cost inclusive of brokerage, Service Tax, Education Cess.

1.3.3 Provision for loss in respect of Open Equity Derivative Instrument as at the Balance Sheet date is made Index-wise/Scrip-wise. As a matter of prudence, any anticipated profit is ignored.

1.4 FIXED ASSETS

Fixed Assets are stated at cost less depreciation.

1.5 DEPRECIATION

Depreciation on tangible assets is provided on Straight Line method over the useful life of assets in the manner specified in Schedule II to the Companies Act, 2013.

1.6 INVESTMENTS

1.6.1 Investments are classified into Current Investments and Noncurrent/Long Term Investments.

1.6.2 Current Investments are valued at lower of cost or fair market value on category wise basis. Noncurrent/Long Term Investments are valued at cost less other than temporary diminution, if any, on scrip wise basis. Provision for reduction/diminution in the value of Investments and reversal of such reduction/ diminution are included in the Profit & Loss Account. For the purpose of disclosure and presentation in the financial statements, and in compliance with “Non-Systemically Important Non-Banking Financial (Non Deposit Accepting or Holding) Companies Prudential Norms (Reserve Bank) Directions,2015: -

(a) on the assets side, investments are shown at cost;

(b) the diminution/depreciation is shown correspondingly under the head “Provisions”(Short term/Long term) in the liabilities side in the Balance Sheet without showing it as deduction from the value of Investments.

1.6.3 Cost of investments is computed using the Weighted Average Method.

1.7 EMPLOYEE BENEFITS

1.7.1 Employee Benefits are recognized/accounted for on the basis of revised AS-15 detailed as under :-

1.7.2 Short Term Employee benefits are recognized as expense at the undiscounted amount in the Statement of Profit & Loss of the year in which they are incurred.

1.7.3 Employee benefits under defined contribution plans comprise of contribution to Provident Fund and Superannuation. Contributions to Provident Fund are deposited with appropriate authorities and charged to Statement of Profit & Loss. Contribution to Superannuation are funded with Life Insurance Corporation of India.

1.7.4 Employee Benefits under defined benefit plans comprise of gratuity and leave encashment which are accounted for as at the yearend based on actuarial valuation by following the Projected Unit Credit (PUC) method. Liability for gratuity is funded with Life Insurance Corporation of India.

1.7.5 Termination benefits are recognized as an Expense as and when incurred.

1.7.6 The actuarial gains and losses arising during the year are recognized in the Statement of Profit & Loss of the year without resorting to any amortization.

1.8 TAXATION

Tax expenses for the year comprises of Current tax and deferred tax charge or credit. The deferred Tax Asset and deferred Tax Liability is calculated by applying tax rates and tax laws that have been enacted or substantially enacted by the Balance Sheet date. Deferred Tax assets arising mainly on account of brought forward losses and unabsorbed depreciation under tax law are recognized only if there is virtual certainty of its realization. Other deferred tax assets are recognized only to the extent there is a reasonable certainty of realization in future. Deferred Tax Assets/Liabilities are reviewed at each balance sheet date based on development during the year, further future expectations and available case laws to reassess realization/ liabilities.

1.9 IMPAIRMENT OF FIXED ASSETS

Consideration is given at each balance sheet date to determine whether there is any indication of impairment of the carrying amount of the Company’s Fixed Assets. If any indication exists, an asset’s recoverable amount is estimated. An impairment loss is recognized whenever the carrying amount of an asset exceeds its recoverable amount. The recoverable amount is the greater of the net selling price and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value based on an appropriate discount factor.

Reversal of impairment losses recognized in prior years is recorded when there is an indication that the impairment losses recognized for the asset no longer exist or have decreased. However, the increase in carrying amount of an asset due to reversal of an impairment loss is recognized to the extent it does not exceed the carrying amount that would have been determined (net of depreciation) had no impairment loss been recognized for the assets in prior years.

1.10 CONTINGENCIES:

The company creates a provision when there is present obligation as result of a past event that probably requires an outflow of resources and a reliable estimate can be made of the amount of the obligation. A disclosure for a contingent liability is made when there is a possible obligation or a present obligation that may, but probably will not, requires an outflow of resources. When there is a possible obligation or a present obligation in respect of which the likelihood of outflow of resources is remote, no provision or disclosure is made.

- Issued Share capital of the Company has only one class of shares referred to as equity shares having Par value ofRs.10/. Each holder of Equity Shares is entitled to One vote per share.

- Reconciliation of the number of shares outstanding and Amount of Share Capital as on 31st March, 2016 & 31st March, 2015 is as under:

- The dividend Proposed, if any, by the Board of Directors is subject to approval of the Shareholders in the ensuing Annual General Meeting.

- In the event of the Liquidation of the company, the holder of equity shares will be entitled to receive any of the 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.

The Company, being an Investment and Finance company, the Income from Investment and

Finance activities are Operational Income.

(1) Profit/(Loss) on Sale/Disposal of Investments includes Loss ofRs.3,53,496/- (Previous Year LossRs.68,51,242/-) on Current Investments and Loss ofRs.1,19,91,369/- (Previous Year GainRs.1,76,04,958/-) on Non current/Long Term Investments.

(2) Provision for diminution in value of Investments written back includeRs.79,99,176/- provision written back (previous yearRs.3,55,94,153/-written back) in respect of Non Current/Long Term Investments andRs.25,95,407/- provision made (Previous Year provision madeRs.8,56,779/-) in respect of Current Investments.

(3) Dividend Income includesRs.43,46,615/-(Previous YearRs.1,52,17,207/-) on Long Term/ Noncurrent Investments andRs.56,229/-(Previous yearRs.4,54,869/-) on Current Investments.

4.. CONTINGENT LIABILITIES AND COMMITMENTS (TO THE EXTENT NOT PROVIDED FOR) CONTINGENT LIABILITIES:

5. Income Tax demand disputedRs.79,32,954/-(Previous yearRs.76,64,464/-) against which appeals are pending with appropriate authorities and in respect of which the management is confident that appeals will be decided in favour of the company.

6. QUANTITATIVE DETAILS

Quantitative information in respect of Investments in securities:

7. NON CURRENT/LONG TERM INVESTMENTS EQUITY INSTRUMENTS

8. RELATED PARTY TRANSACTIONS

9.1 List of related parties with whom transactions have taken place and relationship:

10. Subsidiaries.

11. Mount Finance Limited

12. Key Managerial Personnel

13. Shri Vijay Sood, Managing Director

14. Shri J.M.L.Suri, Executive Director

15. Shri Anil Kumar Mittal, Company Secretary

16. Shri Mahesh Kumar Gupta, Chief Financial Officer

17. Person having control/significant influence /major shareholders 1. Shri Lalit Bhasin

18. Enterprises over which control/significant influence exist of the relatives of persons mentioned in(c ) above :-

19.. RRB Master Securities Delhi Ltd.

20. Enterprises under direct or indirect common control/significant influence:

21.. HB Portfolio Ltd.

22. HB Estate Developers Ltd.

23. HB Securities Ltd.(Subsidiary of HB Portfolio Ltd.)

24. SEGMENT REPORTING

In the opinion of Management there are no separate reportable segments as per Accounting Standard Segment reporting (AS-17).

25. Disclosure pursuant to Accounting Standard AS-19 for Leases: -Operating Lease

26. Particulars of the minimum lease payments under Operating Lease:-

Not Later than One year Rs.12,44,124/- (Previous YearRs.9,67,692/-)

Later than one year but not Later than five years Rs.12,65,624/- (Previous YearRs.9,67,692/-)

Later than five years Rs. Nil (Previous YearRs.NIL)