Notes to Accounts of Future Lifestyle Fashions Ltd.

Mar 31, 2019

1) Corporate information about the Company

Future Lifestyle Fashions Ltd (“the Company”) is a company incorporated in India under the provisions of Companies Act, 1956 on May 30, 2012. The registered address of the Company is knowledge House, Shyam Nagar, Off. Jogeshwari-Vikhroli Link Road, Jogeshwari (East) Mumbai - 400060. The Company is engaged in the business of Retailing of Fashion products through Departmental and neighbourhood stores under various formats across the country. The shares of the Company are listed on the National Stock Exchange of India Limited and BSE Limited. The Financial Statements were approved for issue by the Board of Directors on May 01, 2019. The Financial Statements are presented in Indian Rupees (Rs.) and all values are rounded to the nearest crore except where otherwise indicated.

Terms/Rights Attached to Equity Shares

The company has only one class of equity shares having a par value of Rs.2/- per share. Each holder of equity share is entitled to one vote per share.

The company declares and pays dividends in Indian Rupees (Rs.). The dividend proposed by the Board of Directors is subject to approval of the shareholders in the Annual General Meeting,

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

Share options granted under the Company’s employee share option plan

Share options granted under the company’s employee share option plan carry no right to dividends and no voting rights, Further details of the employee share option plan are provided in Note 36,

Nature of Reserves Capital Reserve

Capital reserve is created for excess of net book value of assets taken and liabilities assumed over the consideration transferred for various business combinations in earlier years.

Securities Premium

Securities premium is used to record the premium received on issue of shares. The securities premium can be utilised only in accordance with the provisions of the Companies Act 2013.

Debenture Redemption Reserve

Debenture Redemption Reserve is a Statutory Reserve (as per Companies Act, 2013) created out of profits of the Company available for payment of dividend for the purpose of redemption of Debentures issued by the Company.

Share Options Outstanding Account

This reserve relates to share option granted by the Company to its employees under its employee share option plan. Further information about share-based payments to employees is set out in note 36.

General Reserve

The general reserve is used from time to time to transfer profits from retained earnings for appropriation purposes. As the general reserve is created by a transfer from one component of equity to another and is not an item of other comprehensive income. Items included in the general reserve will not be reclassified subsequently to profit or loss.

Retained Earnings

This represents the surplus/(deficit) of the statement of profit or loss. The amount that can be distributed by the Company as dividends to its equity shareholders is determined based on the separate financial statements of the Company and also considering the requirements of the Companies Act, 2013.

Equity Instruments through Other Comprehensive Income

Company has designated an investment in equity instrument at fair value through other comprehensive income in which cumulative changes in fair value of such instrument is accumulated in a separate reserve ‘Equity instruments through other comprehensive income’ within other comprehensive income.

2) Segment Information

The Company is engaged in the business of Branding, Manufacturing, Processing, Selling and Distribution of ‘Fashion Products’ which constitutes a single reporting Segment. Hence there is no separate reportable segment under Ind AS 108 Operating segment.

Company does not derive its revenue of 10% or more from any of its single customer.

3) Disclosure Relating to Leases

The Company has entered into operating lease arrangements for premises. The future minimum lease rental obligation under non-cancellable operating leases in respect of these premises is Rs.500.89 crore (2017-18: Rs.323.96 crore). The Lease Rent payable not later than one year is Rs.165.47 crore (2017-18: Rs.122.61 crore), payable later than one year but not later than five year is Rs.330.69 crore (2017-18: Rs.201.35 crore) and payable later than five years is Rs.4.74 crore (2017-18: ‘ Nil crore).

4) Employee Benefit Plans

a) Defined Contribution Plan

The Company operates defined contribution plan (Provident Fund) for all qualifying employees of the Company as per Ind AS 19. The employees of the Company are members of a retirement contribution plan operated by the government. The Company is required to contribute a specified percentage of payroll cost to the retirement contribution scheme to fund the benefits. The only obligation of the Company with respect to the plan is to make the specified contributions.

b) Defined Benefit Plans - Gratuity

The Company operates a gratuity plan covering qualifying employees as per Ind AS 19. The benefit payable is greater of the amount calculated as per the Payment of Gratuity Act, 1975 or the Company Scheme applicable to the employee. The benefit vests upon completion of five years of continuous service and once vested it is payable to employees on retirement or on termination of employment. The gratuity benefits payable to the employees are based on the employee’s service and last drawn salary at the time of leaving. The employees do not contribute towards this plan and the full cost of providing these benefits are met by the Company. In case of death while in service, the gratuity is payable irrespective of vesting. The Company’s obligation towards Gratuity is a Defined Benefit plan and is not funded.

The estimate of rate of escalation in salary considered in actuarial valuation takes into account inflation, seniority, promotion and other relevant factors including supply and demand in the employment market.

(vi) Sensitivity Analysis

Significant actuarial assumptions for the determination of the defined obligation are discount rate and expected salary increase. The sensitivity analysis below have been determined based on reasonably possible changes of the respective assumptions occurring at the end of the reporting period, while holding all other assumptions constant.

The sensitivity analysis presented above may not be representative of the actual change in the defined benefit obligation as it is unlikely that the change in assumptions would occur in isolation of one another as some of the assumptions may be correlated.

c) Other Employee Benefits

The Company has recognised an amount of Rs.4.29 crore (2017-18: Rs.2.26 crore) for long term compensated absences in the statement of Profit and Loss account. Actuarial assumptions for long term compensated absences are

5) Related Party Disclosures

a) Name of Related Parties and Nature of Relationship:

i. Holding Company

Ryka Commercial Ventures Private Limited

ii. Ultimate Controlling Entity

Lifestyle Trust

iii. Subsidiaries

FLFL Business Services Limited

Future Speciality Retail Limited

Future Trendz Limited

iv. Joint Ventures

Celio Future Fashion Private Limited

Clarks Future Footwear Private Limited

FLFL Lifestyle Brands Limited

FLFL Travel Retail West Private Limited (w.e.f. May 30, 2018)

FLFL Travel Retail Bhubaneswar Private Limited (w.e.f. May 30, 2018)

FLFL Travel Retail Guwahati Private Limited (w.e.f. May 30, 2018)

FLFL Travel Retail Lucknow Private Limited (w.e.f. May 30, 2018)

v. Associates

Elisir Lifestyle Private Limited

Future Style Lab Limited

Future Style Lab UK Limited

Indus-League Clothing Limited

Indus Tree Crafts Private Limited

Indus Tree Producer Transform Private Limited

Mineral Fashions Limited

Rachika Trading Limited

vi. Key Management Personnel (KMP)

Managing Director : Kishore Biyani

Non-Executive Directors : Avni Biyani

C. P. Toshniwal Rakesh Biyani Ravinder Singh Thakran

Independent Directors : Bijou Kurien

Dr. Darlie Koshy Shailesh Haribhakti Sharda Agarwal

Alternate Director : Narayan Ramachandran

vii. Entities Controlled by KMP

Bansi Mall Management Company Private Limited

Future Brands Limited

Future Consumer Limited

Future Corporate Resources Private Limited

(Formerly known as Suhani Trading and Investment

Consultants Private Limited)

Future Entertainment Private Limited Future Enterprises Limited

Future Generali India Life Insurance Company Limited

Future Generali India Insurance Company Limited

Future Human Development Limited

Future Ideas Company Limited

Future Market Networks Limited

Future Retail Limited

Future Sharp Skills Limited,

Future Supply Chain Solutions Limited

Idiom Design and Consulting Limited

Retail Light Techniques (India) Limited

Skechers South Asia Private Limited

Suhani Mall Management Company Private Limited

c) Disclosure in respect of Material Transactions with Related Parties

(i) Revenue from Operations includes Future Specialty Retail Limited Rs.0.31 crore (2017-18: Rs.0.20 crore), FLFL Lifestyle Brands Limited Rs.14.43 crore (2017-18: Rs.3.33 crore), Future Enterprises Limited Rs.20.01 crore, Future Retail Limited Rs.16.40 crore.

(ii) Purchase of Goods and Service includes Future Specialty Retail Limited Rs.147.34 crore (2017-18: Rs.151.33 crore), Future Style Lab Limited Rs.13.68 crore (2017-18: Rs.13.09 crore), Rachika Trading Limited Rs.10.00 crore (2017-18: Rs. 7.95 crore), Celio Future Fashion Private Limited Rs.10.93 crore (2017-18: Rs.8.66 crore), Mineral Fashions Limited Rs.15.30 crore, Future Enterprises Limited Rs.629.92 crore, Future Retail Limited Rs.348.21 crore.

(iii) Purchase of Fixed Assets includes Retail Light Techniques (India) Limited Rs.16.72 crore.

(iv) Sale of Fixed Assets includes Future Specialty Retail Limited Rs.1.86 crore (2017-18: Rs.0.06 crore).

(v) Investment made includes FLFL Lifestyle Brands Limited Rs.77.73 crore (2017-18: Rs.0.52 crore).

(vi) Loans and Advance given includes FLFL Lifestyle Brands Limited Rs.82.46 crore (2017-18: Rs.69.52), Future Corporate Resources Private Limited Rs.13.79 crore

(vii) Loans and Advance given received back includes Future Style Lab Limited Rs.5.30 crore, Indus Tree Crafts Private Limited Rs.3.65 crore, Indus Tree Producer Transform Private Limited Rs.0.40 crore.

6) Capital Commitment

The estimated amount of contracts remaining to be executed on Capital Account and not provided for (net of advances) as at March 31, 2019 is Rs.80.55 crore (2017-18: Rs.74.75 crore)

7) Share Based Payments

Details of the employee share based plan of the Company

a) FLFL Employees Stock Options Scheme - 2013 (FLFL ESOS - 2013):

The Shareholders of the Company at their Extraordinary General Meeting held on December 16, 2013 had approved FLFL ESOS -2013 and also approved the issue of 15,00,000 Stock Options exercisable into 15,00,000 fully paid-up Equity Shares of Rs.2 each of the Company, to the eligible employees in terms of the FLFL ESOS -2013 in one or more tranches and on such terms and conditions, as may be determined by the Nomination and Remuneration Committee (NRC) in accordance with the provisions of FLFL ESOS 2013, the Securities and Exchange Board of India (Share Based Employee Benefits) Regulations, 2014 (“SEBI SBEB Regulations”) and in due compliance with other applicable laws and regulations.

The Stock Options granted under FLFL ESOS - 2013 would vest after 1 year and not more than 3 years from the Grant Date of such Stock Options in one or more tranches, as may be specified and approved by the NRC. The Maximum term for exercise of vested Stock Options is 3 years from the respective date of vesting of Stock Options.

b) FLFL Employees Stock Options Plan - 2015 (FLFL ESOP - 2015):

The Shareholders of the Company at their Annual General Meeting held on August 26, 2015 had approved the FLFL ESOP - 2015 and also approved the issue of 35,00,000 Stock Options exercisable into equivalent number of Equity Shares, to be issued and allotted under primary issue or to be acquired by way of secondary acquisition, to or for the benefit of Eligible Employees under FLFL ESOP 2015, not exceeding 35,00,000 Equity Shares of Rs.2 each, in one or more tranches, at such price and on such terms and conditions as may be determined by NRC, in accordance with the provisions of this FLFL ESOP 2015, SEBI SBEB Regulations and in due compliance with other applicable laws and regulations.

Pursuant to the applicable provisions of the Act and the SEBI SBEB Regulations, the Company has set up a ‘Future Lifestyle Fashions Limited Employees’ Welfare Trust’ (“Trust”) for implementation of FLFL ESOP 2015.

Stock Options granted under FLFL ESOP - 2015 would vest not less than 1 year and not more than 3 years from the Grant Date of such Stock Options in one or more tranches, as may be specified and approved by the NRC. The Maximum term for exercise of Stock Options granted is 3 Years from the respective date of vesting of Stock Options granted.

Stock Options were priced using a Black Scholes option pricing model. Expected Volatility was calculated using standard deviation of daily change in stock price. The historical period for Expected Volatility taken into account to match the expected life of the option. There are no market conditions attached to grant and vest,

8) In terms of the Composite scheme of Arrangement and Amalgamation, which is approved by the Hon’ble High Court of Bombay vide its order dated May 10, 2013, Capital reserve was permitted to be utilised for the purpose of adjusting value of any assets including goodwill, investment/offset any charge on account of impairment/write off/amortisation. Accordingly Company has charged a sum of Rs.48.10 crore being impairment of Assets received under the aforesaid scheme to the capital reserve.

9) Disclosure Requirement of Loans, Guarantee and Investment under section 186(4) of the Companies Act,2013 and under Regulation 34(3) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015

10) Financial Instruments and Risk Review Capital Management

The Company manages its capital to ensure that it will be able to continue as going concerns while maximising the return to stakeholders through the optimisation of the debt and equity balance. The capital structure of the Company consists of net debt (i.e. borrowings offset by cash and bank balances) and equity of the Company (comprising issued capital, reserves and retained earnings). The Company monitors capital using a ratio of ‘net debt’ to equity. The Company’s net debt to equity ratio was as follows.

Financial risk management objectives

The Company has a Risk Management Committee instituted by its Board of Directors for overseeing the Risk Management Framework and developing and monitoring the Company’s risk management policies. The risk management policies are established to ensure timely identification and evaluation of risks, setting acceptable risk awareness and transparency, Risk management policies and systems are reviewed regularly to reflect changes in the market conditions and the Company’s activities to provide reliable information to the Management and the Board to evaluate the adequacy of the risk management framework in relation to the risk faced by the Company,

- Market risk

The Company’s activities expose it primarily to the financial risks of changes in foreign currency exchange rates, interest rate risk and other price risk. The Company enters into derivative financial instruments to manage its exposure to foreign currency risk including forward foreign exchange contracts,

- Foreign exchange risk

The Company is exposed to foreign exchange risk arising from foreign currency transactions primarily on account of import of trading goods and capital goods. Foreign exchange risk arises recognised liabilities denominated in a currency that is not the functional currency of the Company. The Company hedges its foreign exchange risk using foreign exchange forward contracts which is within the guidelines laid down by risk management policy of the Company, Overall, Company always have a limited exposure to foreign currency risk,

Following table contains details of the carrying amounts of Company’s unhedged foreign currency denominated in Indian Rupees at the end of the reporting period,

A 5% strengthening in USD and GBP will decrease the profit for the year by Rs.0.29 crore (2017-18: Rs.0.64 crore) and a 5% weakening in USD and GBP will increase the profit for the year by Rs.0.29 crore (2017-18: Rs.0.64 crore), In management’s opinion, the sensitivity analysis is unrepresentative of the inherent foreign exchange risk because the exposure at the end of the reporting period does not reflect the exposure during the year,

- Interest rate risk

Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. The Company borrows the money at variable interest rate and therefore it is exposed to interest rate risk.

The interest rate risk is managed by the Company by maintaining an appropriate mix between fixed and floating rate borrowings. Hedging activities are evaluated regularly to align with interest rate views and defined risk appetite, ensuring the most cost-effective hedging strategies are applied. The company is not exposed to significant interest rate risk as at the respective reporting dates.

- Other price risk

The Company is exposed to equity price risks arising from equity investments. Equity investments are held for strategic rather than trading purposes. The Company does not actively trade these investments,

If equity prices had been 5% higher/ lower, other comprehensive income for the year would increase/decrease by Rs.2.00 crore (2017 - 2018: increase/decrease by Rs.2.00 crore) as a result of the changes in fair value of shares measured at fair value through other comprehensive income,

(i) Credit risk

Credit risk is the risk that counterparty will default on its contractual obligation resulting in a financial loss to the company. The credit risk arises primarily on trade receivables, store deposit with landlord of stores and deposits with banks and financial institutions and other financial instruments,

Most of the Company’s sales is on the counter sale i.e. cash and carry basis on which no credit risk arises, however credit risk arises to the Company on sales to institutional customers/ wholesale customers. Company manages the credit risk arising from trade receivables through credit approvals, establishing credit limits and continuously monitoring the creditworthiness of customers. Company’s customer base is widely spread and therefore it does not have concentration of credit risk. Company manages credit risk on store deposits by timely advance negotiation with landlord of store or through legal action.

Exposures to customers outstanding at the end of each reporting period are reviewed by the Company to determine expected credit losses. Historical trends of impairment of trade receivables do not reflect any significant credit losses. Given that there is no substantial change in the economic environment affecting customers of the Company, the Company expects the historical trend of immaterial credit losses to continue. Following is the change in the loss allowance measured using life-time expected credit loss.

Credit risk on cash and bank balances is limited as company counterparties are banks or financial institutions with high credit ratings assigned credit rating agencies.

(ii) Liquidity risk

Liquidity risk is the risk that the company will fail in meeting its obligations associated with its financial liabilities. The company’s approach to managing liquidity is to ensure that it will have sufficient funds to meet its liabilities when due without incurring unacceptable losses. The Company monitors the rolling forecasts to ensure it has sufficient cash on an on-going basis to meet operational needs.

The following tables detail the Company’s remaining contractual maturity for its financial liabilities with agreed repayment periods. The tables have been drawn up based on the undiscounted cash flows of financial liabilities based. It include both interest and principal cash flows. The contractual maturity is based on the earliest date on which the Company may be required to pay

11) The Hon’ble Supreme Court of India by its order dated February 28, 2019, in the case of M/s. Surya Roshni Limited and others v/s EPFO, set out the principles based on which allowances paid to the employees should be identified for inclusion in basic wages for the purposes of computation of Provident Fund contribution. There are interpretative issues related to the judgement which require clarification. Further Surya Roshni Limited has filed a review petition with Hon’ble Supreme Court of India which is pending for disposal. Pending decision on the subject review petition and clarificatory directions from the EPFO, the impact, if any, is not ascertainable and consequently no effect has been given in the accounts.

12) The Company has transferred its Lee Cooper business on slump exchange to its step down subsidiary Future Speciality Retail Limited (FSRL) during the financial year 2016-17. The Company along with other parties have entered into an investment agreement with the subscribers of CCPS issued by FSRL which allow an exit option to them at an agreed price as per the terms of the agreement.

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Mar 31, 2018

Share options granted under the Company''s employee share option plan

Share options granted under the company''s employee share option plan carry no right to dividends and no voting rights. Futher details of the employee share option plan are provided in note 36.

For addition and deduction under each of the above heads refer statement of change in equity

Nature of Reserves Capital Reserve

Capital reserve is created for excess of net book value of assets taken and liabilities assumed over the consideration transferred for various business combinations in earlier years.

Securities Premium Reserve

Securities premium reserve is used to record the premium received on issue of shares. The securities premium can be utilized only in accordance with the provisions of the Companies Act 2013.

Debenture Redemption Reserve

Debenture Redemption Reserve is a Statutory Reserve (as per Companies Act, 2013) created out of profits of the Company available for payment of dividend for the purpose of redemption of Debentures issued by the Company.

Share Options Outstanding Account

This reserve relates to share option granted by the Company to its employees under its employee share option plan. Further information about share-based payments to employees is set out in note 36.

General Reserve

The general reserve is used from time to time to transfer profits from retained earnings for appropriation purposes. As the general reserve is created by a transfer from one component of equity to another and is not an item of other comprehensive income. Items included in the general reserve will not be reclassified subsequently to profit or loss.

Retained Earnings

This represents the surplus/(deficit) of the statement of profit and loss. The amount that can be distributed by the Company as dividends to its equity shareholders is determined based on the separate financial statements of the Company and also considering the requirements of the Companies Act, 2013.

Equity instruments through other comprehensive income

Company has designated an investment in equity instrument at fair value through other comprehensive income in which cumulative changes in fair value of such instrument is accumulated in a separate reserve ''equity instruments through other comprehensive income'' within other comprehensive income.

27) SEGMENT INFORMATION

The Company is engaged in the business of Branding, Manufacturing, Processing, Selling and Distribution of ''Fashion Products'' which constitutes a single reporting Segment. Hence there is no separate reportable segment under Ind AS 108 Operating segment.

Company does not derive its revenue of 10% or more from any of its single customer. Company does not have any non-current assets located outside India.

28) DISCLOSURE RELATING TO LEASES

The Company has entered into operating lease arrangements for premises. The future minimum lease rental obligation under non-cancellable operating leases in respect of these premises is Rs,323.96 crore (2016-17: Rs,307.16 crore). The Lease Rent payable not later than one year is Rs,122.61 crore (2016-17: Rs,118.22 crore), payable later than one year but not later than five year is Rs,201.35 crore (2016-17: Rs,188.22 crore) and payable later than five years is Rs,Nil crore (2016-17: Rs,0.71 crore).

32) EMPLOYEE BENEFIT PLANS

a) Defined Contribution Plan

The Company operates defined contribution plan (Provident Fund) for all qualifying employees of the Company. The employees of the Company are members of a retirement contribution plan operated by the government. The Company is required to contribute a specified percentage of payroll cost to the retirement contribution scheme to fund the benefits. The only obligation of the Company with respect to the plan is to make the specified contributions.

b) Defined Benefit Plans - Gratuity

The Company operates a gratuity plan covering qualifying employees. The benefit payable is greater of the amount calculated as per the Payment of Gratuity Act, 1975 or the Company Scheme applicable to the employee. The benefit vests upon completion of five years of continuous service and once vested it is payable to employees on retirement or on termination of employment. The gratuity benefits payable to the employees are based on the employee''s service and last drawn salary at the time of leaving. The employees do not contribute towards this plan and the full cost of providing these benefits are met by the Company. In case of death while in service, the gratuity is payable irrespective of vesting. The Company''s obligation towards Gratuity is a Defined Benefit plan and is not funded.

The estimate of rate of escalation in salary considered in actuarial valuation takes into account inflation, seniority, promotion and other relevant factors including supply and demand in the employment market.

Significant actuarial assumptions for the determination of the defined obligation are discount rate and expected salary increase. The sensitivity analysis below have been determined based on reasonably possible changes of the respective assumptions occurring at the end of the reporting period, while holding all other assumptions constant.

The sensitivity analysis presented above may not be representative of the actual change in the defined benefit obligation as it is unlikely that the change in assumptions would occur in isolation of one another as some of the assumptions may be co-related.

c) Other Employee Benefits

The Company has recognized an amount of Rs,2.26 crore (2016-17: Rs,2.58 crore) for compensated absences in the statement of Profit and Loss account. Actuarial assumptions for compensated absences are

33) RELATED PARTY DISCLOSURES

a) Name of Related Parties and Nature of Relationship

i. Holding Company

Ryka Commercial Ventures Private Limited

ii. Ultimate Controlling Entity

Lifestyle Trust

iii. Subsidiary Companies

FLFL Business Services Limited

Future Speciality Retail Limited

Future Style Lab Limited (upto March 29, 2017)

Future Trendz Limited

Indus-League Clothing Limited (upto March 29, 2017) Rachika Trading Private Limited (upto March 29, 2017)

iv. Joint Ventures

Celio Future Fashion Private Limited Clarks Future Footwear Private Limited Elisir Lifestyle Private Limited (upto March 29, 2017) FLFL Lifestyle Brands Limited (w.e.f March 30, 2017) Holii Accessories Private Limited

v. Associates

Eclat Life Style Private Limited (upto March 29, 2017)

Future Style Lab Limited (w.e.f March 30, 2017)

Indus-League Clothing Limited (w.e.f March 30, 2017)

Indus Tree Craft Private Limited (upto March 29, 2017)

Indus Tree Producer Transform Private Limited (upto March 29, 2017)

KFC Shoemaker Private Limited (upto March 29, 2017) Mineral Fashions Private Limited (upto March 29, 2017) Rachika Trading Private Limited (w.e.f March 30, 2017) Resource World Exim Private Limited (upto March 29, 2017) Turtle Limited (upto March 29, 2017)

Unico Retail Private Limited (upto March 29, 2017)

vi. Key Management Personnel (KMP)

Kishore Biyani

vii. Entity Controlled by KMP

Future Ideas Company Limited

(ii) Purchase of Goods and Service includes Future Specialty Retail Limited Rs,151.33 crore (2016-17: Rs,1.04 crore), Future Style Lab Limited Rs,13.09 crore(2016-17: Rs,7.18 crore), Rachika Trading Private Limited Rs,7.95 crore(2016-17: Rs,9.77 crore), Celio Future Fashion Private Limited Rs,8.66 crore (2016-17: Rs,7.57 crore), Clarks Future Footwear Private Limited Rs,5.01 crore (2016-17: Rs,3.27 crore), Future Ideas Company Limited Rs,10.71 crore (2016-17: Rs,6.79 crore).

(iii) Sale of Fixed Assets includes Future Specialty RetailLimited Rs,0.06 crore (2016-17: Rs,Nil), FLFL Business Services Limited Rs,Nil (2016-17: Rs,0.10 crore).

(iv) Investment made includes FLFL Business Services Limited Rs,0.10 crore (2016-17: Rs,Nil), Future Trendz Limited Rs,0.20 crore (2016-17: Rs,0.30 crore), Clarks Future Footwear Private Limited Rs,1.40 crore (2016-17 : Rs,5.00 crore), FLFL Lifestyle Brands Limited Rs,0.52 crore (2016-17 : Rs,6.50 crore), Holii Accessories Private Limited Rs,0.24 crore (2016-17 Rs,2.00 crore), Future Style Lab Limited Rs,Nil crore (2016-17 : Rs,19.90 crore).

(v) Loans and Advance given includes FLFL Lifestyle Brands Limited Rs,69.52 crore (2016-17: Rs,Nil), Future Style Lab Limited Rs,5.30 crore (2016-17 : Rs,2.50 crore).

34) CAPITAL COMMITMENT

The estimated amount of contracts remaining to be executed on Capital Account and not provided for (net of advances) as at March 31, 2018 is Rs,74.75 (2016-17: Rs,84.70 crore)

35) TRADE PAYABLES

There are no Micro Small and Medium Enterprises, to whom the Company owes dues which are outstanding for more than 45 days during the period. The information as required to be disclosed under the Micro, Small and Medium Enterprise Development Act, 2006 has been determined to the extent such parties have been identified on the basis of information available with the Company and relied by the auditors.

36) SHARE BASED PAYMENTS

Details of the employee share based plan of the Company

a) FLFL Employees Stock Options Scheme - 2013 (FLFL ESOS - 2013):

The Shareholders of the Company at their Extraordinary General Meeting held on December 16, 2013 had approved FLFL ESOS -2013 and also approved the issue of 15,00,000 (Fifteen Lakhs) Stock Options exercisable into 15,00,000 (Fifteen Lakhs) fully paid-up Equity Shares of Rs,2 each of the Company to the eligible employees in terms of the FLFL ESOS -2013 in one or more tranches and on such terms and conditions, as may be determined by the Nomination and Remuneration Committee (NRC) in accordance with the provisions of FLFL ESOS 2013, SEBI Regulations and in due compliance with other applicable laws and regulations.

The Stock Options granted under FLFL ESOS - 2013 would vest after 1 year and not more than 3 years from the Grant Date of such Stock Options in a specified proportion, as approved by the NRC. The Maximum term for exercise of vested Stock Options is 3 years from the respective date of vesting of Stock Options.

b) FLFL Employees Stock Options Plan - 2015 (FLFL ESOP - 2015):

The Shareholders of the Company at their Annual General Meeting held on August 26, 2015 had approved the FLFL ESOP - 2015 and also approved to issue of 35,00,000 Stock Options exercisable into equivalent number of Equity Shares, to be issued and allotted under primary issue or to be acquired by way of secondary acquisition, to or for the benefit of Eligible Employees under FLFL ESOP 2015, not exceeding 35,00,000 Equity Shares of Rs,2 each, in one or more tranches, at such price and on such terms and conditions as may be determined by NRC, in accordance with the provisions of this FLFL ESOP 2015, SEBI Regulations and in due compliance with other applicable laws and regulations.

Pursuant to the applicable provisions of the Act and the Securities and Exchange Board of India (Share Based Employee Benefits) Regulations, 2014, the Company has set up a ''Future Lifestyle Fashions Limited Employees'' Welfare Trust'' ("Trust") for implementation of FLFL ESOP 2015.

Stock Options granted under FLFL ESOP - 2015 would vest not less than 1 year and not more than 3 years from the Grant Date of such Stock Options. The Maximum term for exercise of Stock Options granted is 3 Years from the respective date of vesting of Stock Options granted.

Level 2: The fair value of financial instruments that are not traded in an active market is determined using valuation techniques which maximize the use of observable market data and rely as little as possible on entity-specific estimates.

Financial risk management objectives

The Company has a Risk Management Committee instituted by its Board of Directors for overseeing the Risk Management Framework and developing and monitoring the Company''s risk management policies. The risk management policies are established to ensure timely identification and evaluation of risks, setting acceptable risk awareness and transparency. Risk management policies and systems are reviewed regularly to reflect changes in the market conditions and the Company''s activities to provide reliable information to the Management and the Board to evaluate the adequacy of the risk management framework in relation to the risk faced by the Company.

- Market risk

The Company''s activities expose it primarily to the financial risks of changes in foreign currency exchange rates, interest rate risk and other price risk. The Company enters into derivative financial instruments to manage its exposure to foreign currency risk including forward foreign exchange contracts.

- Foreign exchange risk

The Company is exposed to foreign exchange risk arising from foreign currency transactions primarily on account of import of trading goods and capital goods. Foreign exchange risk arises recognized liabilities denominated in a currency that is not the functional currency of the Company. The Company hedges its foreign exchange risk using foreign exchange forward contracts as per it''s within the guidelines laid down by risk management policy of the Company. Overall, Company always have a limited exposure to foreign currency risk.

Following table details the carrying amounts of the Company''s unhedged foreign currency denominated monetary items at the end of the reporting period

A 5% strengthening in USD and GBP will decrease the profit for the year by Rs,0.64 crore (2016-17: Rs,0.76 crore) and a 5% weakening in USD and GBP will increase the profit for the year by Rs,0.64 crore (2016-17: Rs,0.76 crore). In management''s opinion, the sensitivity analysis is unrepresentative of the inherent foreign exchange risk because the exposure at the end of the reporting period does not reflect the exposure during the year

- Interest rate risk

Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. The Company borrows the money at variable interest rate and therefore it is exposed to interest rate risk.

The interest rate risk is managed by the Company by maintaining an appropriate mix between fixed and floating rate borrowings. Hedging activities are evaluated regularly to align with interest rate views and defined risk appetite, ensuring the most cost-effective hedging strategies are applied. The company is not exposed to significant interest rate risk as at the respective reporting dates.

- Other price risk

The Company is exposed to equity price risks arising from equity investments. Equity investments are held for strategic rather than trading purposes. The Company does not actively trade these investments.

If equity prices had been 5% higher/lower, other comprehensive income for the year would increase/decrease by Rs,2.00 crore (2016

- 2017: increase/decrease by Rs,1.97 crore) as a result of the changes in fair value of shares measured at fair value through other comprehensive income.

(i) Credit risk

Credit risk is the risk that counterparty will default on its contractual obligation resulting in a financial loss to the company. The credit risk arises primarily on trade receivables, store deposit with landlord of stores and deposits with banks and financial institutions and other financial instruments.

Most of the Company''s sales is on the counter sale i.e. cash and carry basis on which no credit risk arises, however credit risk arises to the Company on sales to institutional customers/ wholesale customers. Company manages the credit risk arising from trade receivables through credit approvals, establishing credit limits and continuously monitoring the creditworthiness of customers. Company''s customer base is widely spread and therefore it does not have concentration of credit risk. Company manages credit risk on store deposits by timely advance negotiation with landlord of store or through legal action.

Exposures to customers outstanding at the end of each reporting period are reviewed by the Company to determine expected credit losses. Historical trends of impairment of trade receivables do not reflect any significant credit losses. Given that there is no substantial change in the economic environment affecting customers of the Company, the Company expects the historical trend of immaterial credit losses to continue. Following is the change in the loss allowance measured using life-time expected credit loss.

Credit risk on cash and bank balances is limited as company counterparties are banks or financial institutions with high credit ratings assigned credit rating agencies.

(ii) Liquidity risk

Liquidity risk is the risk that the company will fail in meeting its obligations associated with its financial liabilities. The company''s approach to managing liquidity is to ensure that it will have sufficient funds to meet its liabilities when due without incurring unacceptable losses. The Company monitors the rolling forecasts to ensure it has sufficient cash on an on-going basis to meet operational needs.

The following tables detail the Company''s remaining contractual maturity for its financial liabilities with agreed repayment periods. The tables have been drawn up based on the undiscounted cash flows of financial liabilities based. It include both interest and principal cash flows. The contractual maturity is based on the earliest date on which the Company may be required to pay

39) The Company has transferred its Lee Cooper business on slump exchange to its step down subsidiary Future Specialty Retail Limited (FSRL) during financial year 2016-17. The Company along with other parties have entered into an investment agreement with the subscribes of CCPS issued by FSRL which allow an exit option to them at an agreed price as per the terms of the agreement.

40) FIRST TIME IND AS ADOPTION RECONCILIATION

In preparing its opening Ind AS balance sheet, the company has adjusted the amounts reported previously in financial statements prepared in accordance previous GAAP An explanation of how the transition from previous GAAP to Ind AS has affected the company''s equity and profit is set out as follows:

A. In accordance with Ind AS 101, the Company has elected to measure all items of Property plant and equipment (PPE) at fair value as at transition date of April 01, 2016. These fair values are considered as deemed cost as at transition date. Depreciation is calculated on deemed cost effective from transition date. Accordingly there is a reduction in equity as at April 01, 2018 on account of fair valuation of PPE and consequential decrease in depreciation expenses for the year ended March 31, 2017. The reduction in value of PPE on account of fair valuation has been adjusted against capital reserve as allowed under the composite scheme of arrangement and amalgamation among the Company and various other parties.

B. Under previous GAAP current investments in equity instruments were measured at lower of cost or net realizable value. Under Ind AS, fair value changes with respect to investments in equity instruments (other than in subsidiaries, joint ventures and associates) have been recognized in equity as a separate component as at the date of transition and subsequently in the other comprehensive income.

C. Under previous GAAP interest expense was recognized based on contractual interest rates and expenses directly attributable for fund raising has been charged off in statement of Profit and Loss when incurred. Under Ind AS, effective interest rate method is used to recognized interest expenses and for calculation of amortized cost of borrowing. Refer accounting policies for effective interest method.

D. Under previous GAAP dividends proposed by the Board of Directors after the Balance Sheet date, but before the approval of the Financial Statements were considered as adjusting events for financial year ended March 31, 2016. Accordingly, provision for proposed dividend was recognized as a liability as at April 01, 2016. Under Ind AS, such dividends are recognized when the same is approved by the Shareholders in the General Meeting. Accordingly, the liability for proposed dividend (including dividend distribution tax) of as at April 01, 2016 included under provisions has been reversed with corresponding adjustment to retained earnings. Consequently, the total equity increased by an equivalent amount.

E. Under the previous GAAP interest free lease security deposits are recorded at their transaction value. Under Ind AS, all financial assets are required to be recognized at fair value on initial recognition. Accordingly the Company has measured these deposits at fair value as at initial recognition. Difference between the fair value and transaction value of the security deposit has been recognized as prepaid rent as at initial recognition. Subsequently, security deposit is measured at amortized by recognizing interest income and prepaid rent is amortized as rent expenses.

F. Under previous GAAP foreign currency forward contract has been accounted by amortizing the forward premium/ discount. Under Ind AS these derivative instruments (including embedded derivative contract) are measured at fair value at each reporting date with changes in the fair value is recognized in the statement of profit and loss.

G. Under the previous GAAP the cost of equity-settled employee share-based plan were recognized using the intrinsic value method. Under Ind AS, the cost of equity settled share-based plan is recognized based on the fair value of the options as at the grant date.

H. Under Ind AS, actuarial gains and losses on re-measurements of defined benefit obligation are recognized in Other Comprehensive Income instead of Statement of Profit and Loss. Consequential tax impact is also recognized in other comprehensive income.

I. Deferred tax have been recognized on the adjustments made on transition to Ind AS using balance sheet approach for calculation of deferred tax assets/ liabilities.

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Mar 31, 2017

1. Disclosure Relating to Leases

The Company has entered into operating lease arrangements for premises. The future minimum lease rental obligation under non-cancellable operating leases in respect of these assets is Rs, 307.16 Crore (2015-16: Rs, 294.68 Crore). The Lease Rent payable not later than one year is Rs, 118.22 Crore (2015-16: Rs, 136.08 Crore), payable later than one year but not later than five year is Rs, 188.22 Crore (2015-16: Rs, 182.74 Crore) and payable later than five years is Rs, 0.71 Crore (2015-16: Rs, 1.00 Crore)

2. Capital and other Commitments

Estimated amount of contracts remaining to be executed on capital account and not provided for (net of advances) Rs, 84.70 Crore (2015-16: Rs, 11.59 Crore).

3. Borrowing Cost

The borrowing cost capitalized during the year ended March 31, 2017 was '' Nil (2015-16: '' Nil).

4. Related Party Disclosures

As required under Accounting Standard 18 "Related Party Disclosures" are given below:

A.List of Related Parties

a. Holding Companies/Entity

i. Future Corporate Resources Limited (w.e.f. December 26, 2016 upto March 30, 2017)

ii. Lifestyle Trust (w.e.f. March 31, 2017)

iii. Ryka Commercial Ventures Private Limited (w.e.f. March 31, 2017)

b. Fellow Subsidiary

i. Bansi Mall Management Company Private Limited (w.e.f. December 26, 2016 upto March 30, 2017)

ii. Future Entertainment Private Limited (w.e.f. December 26, 2016 upto March 30, 2017)

iii. Future Sharp Skills Private Limited (w.e.f. December 26, 2016 upto March 30, 2017)

iv. Retail Light Techniques (India) Limited (w.e.f. December 26, 2016 upto March 30, 2017)

c. Subsidiary Companies

i. Elisir Lifestyle Private Limited (upto March 29, 2017)

ii. FLFL Business Services Limited (w.e.f. March 27, 2017)

iii. FLFL Lifestyle Brands Limited (w.e.f. March 17, 2017 upto March 29, 2017)

iv. Future Speciality Retail Limited (w.e.f. September 27, 2016)

v. Future Style Lab Limited (w.e.f. July 6, 2015 upto March 29, 2017)

vi. Future Trendz Limited (w.e.f. September 15, 2016)

vii. Indus-League Clothing Limited (upto March 29, 2017 )

viii. Indus Tree Craft Private Limited (upto March 29, 2017)

ix. Indus Tree Producer Transform Private Limited (upto March 29, 2017)

x. Mineral Fashions Private Limited (w.e.f. April 1, 2016 upto March 29, 2017)

xi. Rachika Trading Private Limited (upto March 29, 2017)

d. Associate Companies

i. Eclat Life Style Private Limited (upto March 29, 2017)

ii. FLFL Lifestyle Brands Limited (w.e.f. March 30, 2017)

iii. KFC Shoemaker Private Limited (upto March 29, 2017)

iv. Resource World Exim Private Limited (upto March 29, 2017)

v. Turtle Limited (upto March 29, 2017)

e. Joint Ventures

i. Celio Future Fashion Private Limited

ii. Clarks Future Footwear Private Limited

iii. Holii Accessories Private Limited (upto March 29, 2017)

f. Enterprises over which key managerial personnel are able to exercise significant influence

i. Future Corporate Resource Limited

ii. Future Enterprises Limited

iii. Future Ideas Company Limited

iv. Future Retail Limited

g. Key Management Personnel (KMP)

i. Mr. Kishore Biyani - Managing Director

ii. Mr. C.P. Toshniwal - Executive Director & Chief Financial Officer (upto May 01, 2016)

ii Purchase of Goods and Services includes Rachika Trading Private Limited Rs, 9.77 Crore (2015-16: Rs, 11.70 Crore), Indus Tree Producer Transform Private Limited Rs, 3.80 Crore (2015-16: Rs, 6.47 Crore), Elisir Lifestyle Private Limited Rs, 10.25 Crore (2015-16: Rs, 15.84 Crore), Turtle Limited Rs, 28.28 Crore (2015-16: Rs, 25.68 Crore), Celio Future Fashion Private Limited Rs, 7.57 Crore (2015-16: Rs, 6.48 Crore), Future Retail Limited Rs, 88.97 Crore (2015-16: Rs, Nil), KFC Shoemaker Private Limited Rs, 6.11 Crore (2015-16: Rs, 4.91 Crore), Future Corporate Resources Limited '' 42.29 Crore (2015-16: Rs, 49.52 Crore), Mineral Fashions Private Limited Rs, 8.01 Crore (2015-16: Rs, 5.90 Crore), Future Style Lab Limited '' 7.18 Crore ( 2015-16: Rs, Nil), Future Enterprises Limited Rs, 4.42 Crore (2015-16: Rs, 4.17 Crore), Clark Future Footwear Private Limited Rs, 3.27 Crore (2015-16: Rs, Nil), Resource World Exim Private Limited Rs, 5.29 Crore (2015-16: Rs, Nil).

iii Purchase of Fixed Assets includes Future Retail Limited Rs, 0.27 Crore (2015-16: Rs, Nil), Retail Light Techniques (India) Limited Rs, 4.16 Crore (2015-16: Rs, Nil).

iv Sale of Fixed Assets includes Future Enterprises Limited Rs, 0.49 Crore (2015-16: Rs, 0.07 Crore), FLFL Business Services Limited Rs, 0.10 Crore (2015-16: Rs, Nil).

v Investment made includes Future Style Lab Limited Rs, 19.90 Crore (2015-16: Rs, 4.97 Crore), Mineral Fashions Private Limited Rs, 3.69 Crore (2015-16: Rs, 3.80 Crore), Holii Accessories Private Limited Rs, 2.00 Crore (2015-16: Rs, 2.50 Crore), Clark Future Footwear Private Limited Rs, 5 Crore (2015-16: Rs, Nil ), FLFL Lifestyle Brands Limited Rs, 6.5 Crore (2015-16: Rs, Nil), Future Trendz Limited Rs, 0.30 Crore (2015-16: Rs, Nil).

vi Sale of Investment includes FLFL Lifestyle Brands Limited '' 450.00 (2015-16: '' Nil).

* 49.00% of the equity share capital is held by FLFL Lifestyle Brands Limited. ** 3.13% of the equity share capital is held by FLFL Lifestyle Brands Limited.

5. Segment Reporting

The Company is primarily engaged in the business of fashion, which in terms of Accounting Standard 17 notified under the Companies (Accounting Standards) Rules, 2006 (as amended) "Segment Reporting" constitutes a single reporting segment.

6. There are no Micro, Small and Medium Enterprises, to whom the Company owes dues which are outstanding for more than 45 days during the period. This information as required to be disclosed under the Micro, Small and Medium Enterprise Development Act, 2006 has been determined to the extent such parties have been identified on the basis of information available with the Company and relied by the auditors.

7. a. The Company uses foreign currency forward contracts to hedge its risks associated with foreign currency exposures relating to the underlying transactions and firm commitments. The Company does not enter into any derivatives instruments for trading and speculative purposes. Forward Contract outstanding as at March 31, 2017 are '' 3.39 Crore (2015-16: Rs, 1.77 Crore).

b. As of Balance Sheet date the Company has net foreign currency exposures (in USD) that are not hedged by derivate instruments or otherwise amounting to Rs, 15.18 Crore (2015-16: Rs, 29.37 Crore)

8. Particulars of loans, Guarantee and investment under section 186(4) of the Companies Act, 2013 and under regulation 34(3) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015

Stock Compensation Expense:

The employee compensation cost has been calculating using the intrinsic value method of accounting for Options issued under the Company''s Employee Stock Options Schemes. Such Options are granted under graded vesting plan with only service conditions, The Company has recognized the share based compensation cost on straight line basis over the requisite service period for the entire award as per para 42A of the ICAI Guidance on Accounting for Employee Share-based payments. The employee compensation cost as per intrinsic value method for the Financial year 2016-17 is Rs, 3.74 Crore (2015-16- Rs, 3.07 Crore)

9. The Company has transferred its Lee cooper business on slump exchange to its step down subsidiary Future Specialty Retail Limited (FSRL).

10. The Company along with other parties have entered into an investment agreement with the subscribers of CCPS issued by FSRL which allows an exit option to them at an agreed price as per the terms of the agreement.

11. As per the amendments notified on March 30, 2017 to Schedule III, Clause K is inserted in Note 6 to General Instructions for Preparation of Balance Sheet stating that every company shall disclose the details of SBNs held and transacted during the period November 8, 2016 to December 30, 2016 as provided in the following table:

It is further stated that the term ''Specified Bank Notes'' shall have the same meaning provided in the notification of the Government of India, in the Ministry of Finance, Department of Economic Affairs number S.O. 3407(E), dated November 8, 2016.

12. Previous Year''s Figures have been regrouped / reclassified wherever necessary to correspond with the current year''s classification/disclosure.

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Mar 31, 2016

1. Disclosure Relating to Leases

The Company has entered into operating lease arrangements for premises. The future minimum lease rental obligation under non-cancellable operating leases in respect of these assets is Rs. 294.68 Crore (2014-15: Rs. 313.05 Crore). The Lease Rent payable not later than one year is Rs. 136.08 Crore (2014-15: Rs. 130.21 Crore), payable later than one year but not later than five year is Rs. 157.60 Crore (2014-15: Rs. 182.74 Crore) and payable later than five years is Rs. 1.00 Crore (2014-15: Rs. 0.09 Crore).

2. Capital and other Commitments

Estimated amount of contracts remaining to be executed on capital account and not provided for (net of advances) Rs. 11.59 Crore (2014-15: Rs. 14.60 Crore).

3. Borrowing Cost

The borrowing cost capitalized during the year ended March 31, 2016 was Rs. Nil (2014-15: Rs. 4.23 Crore).

4. Related party Disclosures

As required under Accounting Standard 18 "Related Party Disclosures" are given below:

A. List of Related parties

a. Subsidiary Companies

i. Elisir Lifestyle Private Limited

ii. Future Style Lab Limited (w.e.f. July 06, 2015)

iii. Indus-League Clothing Limited

iv. Indus Tree Crafts Private Limited

v. Indus Tree Producer Transform Private Limited (100% Subsidiary of Indus Tree Crafts Private Limited)

vi. Rachika Trading Private Limited

b. Associate Companies

i. Eclat Life Style Private Limited

ii. KFC Shoemaker Private Limited

iii. Mineral Fashions Private Limited

iv. Resource World Exim Private Limited

v. Turtle Limited

c. Joint ventures

i. Celio Future Fashion Private Limited

ii. Clarks Future Footwear Private Limited

iii. Holii Accessories Private Limited

d. Enterprises over which key managerial personnel are able to exercise significant influence

i. Future Corporate Resources Limited

ii. Future Enterprises Limited (Formerly known as Future Retail Limited)

iii. Future Ideas Company Limited

e. key Management personnel (KMp)

i. Mr. Kishore Biyani - Managing Director

ii. Mr. C. P. Toshniwal - Executive Director & Chief Financial Officer

C. Significant Related party Transaction

i. Revenue from Operation includes Rachika Trading Private Limited Rs. 2.95 Crore (2014-15: Rs. 8.34 Crore), Turtle Limited Rs. 0.33 Crore (2014-15: Rs. 2.63 Crore), Future Enterprises Limited Rs. 95.32 Crore (2014-15: Rs. 170.78 Crore), Future Style Lab Limited Rs. 1.66 Crore (2014-15: Rs. Nil), Celio Future Fashion Private Limited Rs. 0.35 Crore (2014-15: Rs. 0.45 Crore).

ii. Purchase of Goods and Services includes Rachika Trading Private Limited Rs. 11.70 Crore (2014-15: Rs. 7.17 Crore), Indus Tree Producer Transform Private Limited Rs. 6.47 Crore (2014-15 : Rs. 1.16 Crore), Elisir Lifestyle Private Limited Rs. 15.84 Crore (2014-15: Rs. 2.15 Crore), Turtle Limited Rs. 25.68 Crore (2014-15: Rs. 37.25 Crore), Celio Future Fashion Private Limited Rs. 6.48 Crore (2014-15: Rs. 5.86 Crore), Future Enterprises Limited Rs. 4.17 Crore (2014-15: Rs. 57.97 Crore), KFC Shoemaker Private Limited Rs. 4.91 Crore (2014-15: Rs. 3.80 Crore), Future Corporate Resources Limited 49.52 Crore (2014-15: Rs. 41.10 Crore), Mineral Fashions Private Limited Rs. 5.90 Crore (2014-15 : Rs. 2.09 Crore).

iii. Purchase of Fixed Assets includes Future Enterprises Limited Rs. 0.69 Crore (2014-15: Rs. 0.55 Crore).

iv. Sale of Fixed Assets includes Future Enterprises Limited Rs. 0.07 Crore (2014-15: Rs. 1.83 Crore).

v. Investment made includes Rachika Trading Private Limited Rs. 20.00 Crore (2014-15: Rs. Nil), Future Style Lab Limited Rs. 4.97 Crore (2014-15: Rs. Nil), Mineral Fashions Private Limited Rs. 3.80 Crore (2014-15: Rs. 5.00 Crore), KFC Shoemaker Private Limited Rs. 0.99 Crore (2014-15: Rs. Nil), Holii Accessories Private Limited Rs. 2.50 Crore (2014-15: Rs. Nil), Celio Future Fashion Private Limited Rs. 0.88 Crore (2014-15: Rs. Nil).

5. Segment Reporting

The Company is primarily engaged in the business of fashion, which in terms of Accounting Standard 17 notified under the Companies (Accounting Standards) Rules, 2006 (as amended) "Segment Reporting" constitutes a single reporting segment.

6. There are no Micro, Small and Medium Enterprises, to whom the Company owes dues which are outstanding for more than 45 days during the year. This information as required to be disclosed under the Micro, Small and Medium Enterprise Development Act, 2006 has been determined to the extent such parties have been identified on the basis of information available with the Company and relied by the auditors.

7. a. The Company uses foreign currency forward contracts to hedge its risks associated with foreign currency exposures relating to the underlying transactions and firm commitments. The Company does not enter into any derivatives instruments for trading and speculative purposes. Forward Contract outstanding as at March 31, 2016 are Rs. 1.77 Crore (2014-15: Rs. 9.36 Crore).

b. As of Balance Sheet date the Company has net foreign currency exposures (in USD) that are not hedged by derivate instruments or otherwise amounting to Rs. 29.37 Crore (2014-15: Rs. 4.04 Crore)

8. Investment by the Company in Subsidiary companies, Joint Venture companies and Associate companies are held exclusively with a view to its subsequent disposal in near future and therefore it is not required to prepare consolidated financial statements under the provisions of the Companies Act, 2013 and the prescribed Accounting Standards.

9. There was a fire at the Company''s one of the Brand Factory store situated at Marathali Bangalore on October 02, 2015, due to which it has become non-operational. The loss incurred by the Company is adequately covered under insurance claim. The Company has also started a new Brand Factory store in the same vicinity on October 17, 2015.

10. For the Year ended March 31, 2016 the Board of Directors of the Company have recommended dividend of Rs. 0.40 Per Share (2014-15: Rs. 0.40) to Equity Shareholders aggregating to Rs. 9.13 Crore (2014-15 : Rs. 9.10 Crore) including Dividend Distribution Tax.

11. Previous Year''s Figures have been regrouped / reclassified wherever necessary to correspond with the current year''s classification/disclosure.

---

Mar 31, 2015

1. Disclosure Relating to Leases

The Company has entered into operating lease arrangements for fixed assets and premises. The future minimum lease rental obligation under non-cancellable operating leases in respect of these assets is Rs. 624.33 Crore (2014: Rs. 391.24 Crore). The Lease Rent payable not later than one year is Rs. 163.81 Crore (2014: Rs. 162.50 Crore), payable later than one year but not later than five year is Rs. 364.54 Crore (2014: Rs. 224.64 Crore) and payable later than five years is Rs. 95.97 Crore (2014: Rs. 4.10 Crore)

2. Capital and other Commitments

Estimated amount of contracts remaining to be executed on capital account and not provided for (net of advances) Rs. 14.60 Crore (2014: Rs. 17.64 Crore).

3. Contingent Liabilities

(Rs. in Crore)

Particulars 2014-15 2013-14

A. Claims against the Company not acknowledged as debts 3.37 4.24

B. Corporate Guarantees given 24.20 5.00

C. Guarantees given by the bank on behalf of the Company 0.31 0.31

4. Borrowing Cost

The borrowing cost capitalized during the year ended March 31, 2015 was Rs. 4.23 Crore (2014: Rs. 10.88 Crore).

5. Related Party Disclosures

As required under Accounting Standard 18 "Related Party Disclosures" are given below:

A. List of Related Parties

a. Subsidiary Companies

i. Elisir Lifestyle Private Limited (w.e.f. October 17,2014)

ii. Indus-League Clothing Limited

iii. Indus Tree Crafts Private Limited

iv. Indus Tree Producer Transform Private Limited (100% Subsidiary of Indus Tree Crafts Private Limited)

v. Rachika Trading Private Limited (w.e.f. April 10,2014)

b. Associate Companies

i. Eclat Life Style Private Limited (w.e.f. August 08,2014)

ii. KFC Shoemaker Private Limited

iii. Mineral Fashions Private Limited

iv. Resource World Exim Private Limited

v. Turtle Limited

c. Joint Ventures

i. Celio Future Fashion Private Limited (Formerly known as Celio Future Fashion Limited)

ii. Clarks Future Footwear Private Limited ( Formerly known as Clarks Future Footwear Limited)

iii. Holii Accessories Private Limited

d. Enterprises over which key managerial personnel are able to exercise significant influence

i. Future Corporate Resources Limited

ii. Future Ideas Company Limited

iii. Future Retail Limited

e. Key Management Personnel

i. Mr. Kishore Biyani - Managing Director

ii. Mr. C. P. Toshniwal - Executive Director & Chief Financial Officer

i. Revenue from Operation includes Rachika Trading Private Limited Rs. 8.34 Crore (2014: Rs. Nil), Turtle Limited Rs. 2.63 Crore (2014: Rs. 0.38 Crore), Celio Future Fashion Private Limited Rs. 0.45 Crore (2014: Rs. 0.02 Crore), Future Retail Limited Rs. 170.78 Crore (2014: Rs. 14.75 Crore).

ii. Purchase of Goods and Services includes Rachika Trading Private Limited Rs. 7.17 Crore (2014 : '' Nil),Indus Tree Producer Transform Private Limited Rs. 1.16 Crore (2014 : Rs. Nil),Elisir Lifestyle Private Limited Rs. 2.15 Crore (2014 : Rs. Nil),Turtle Limited Rs. 37.25 Crore (2014: Rs. 17.99 Crore),Celio Future Fashion Private Limited Rs. 5.86 Crore (2014 : Rs. 3.97 Crore),Future Retail Limited Rs.57.97 Crore (2014 : Rs. Nil), Future Corporate Resources Limited Rs. 41.10 Crore (2014 : Rs. 27.03 Crore).

iii. Purchase of Fixed Assets includes Clarks Future Footwear Private Limited Rs. 0.14 Crore (2014: Rs. Nil), Future Retail Limited Rs. 0.55 Crore (2014: Rs. Nil).

iv. Sale of Fixed Assets includes Future Retail Limited Rs. 1.83 Crore (2014: Rs. Nil).

v. Investment made includes Indus Tree Crafts Private Limited Rs. 7.47 Crore (2014: Rs. 2 Crore) Mineral Fashions Private Limited Rs. 5.00 Crore (2014: Rs. Nil), Clarks Future Footwear Private Limited Rs. 5.00 Crore (2014: Rs. Nil).

vi. Loans and Advances Given includes Rachika Trading Private Limited Rs. 24.74 Crore (2014: Rs. Nil).

vii. Deposit Received includes Turtle Limited Rs. 0.74 Crore(2014: Rs. 0.17 Crore), Mineral Fashions Private Limited Rs. 0.28 Crore (2014: Rs. 0.11 Crore)

6. Segment Reporting

The Company is primarily engaged in the business of fashion, which in terms of Accounting Standard 17 notified under the Companies (Accounting Standards) Rules, 2006 (as amended) "Segment Reporting" constitutes a single reporting segment.

7. There are no Micro, Small and Medium Enterprises, to whom the Company owes dues which are outstanding for more than 45 days during the period. This information as required to be disclosed under the Micro, Small and Medium Enterprise Development Act, 2006 has been determined to the extent such parties have been identified on the basis of information available with the Company and relied by the auditors.

8. a. The Company uses foreign currency forward contracts to hedge its risks associated with foreign currency exposures relating to the underlying transactions and firm commitments. The Company does not enter into any derivatives instruments for trading and speculative purposes. Forward contracts outstanding as at March 31, 2015 are Rs. 9.36 Crore (2014: Rs. 2.04 Crore)

b. As of Balance Sheet date the Company has net foreign currency exposures (in USD) that are not hedged by derivative instruments or otherwise amounting to Rs. 4.04 Crore (2014: Rs. 3.51 Crore).

9. Investment by the Company in Subsidiary companies, Joint Venture companies and Associate companies are held exclusively with a view to its subsequent disposal in near future and therefore it is not required to prepare consolidated financial statements under the provisions of Companies Act, 2013 and the prescribed Accounting Standards.

10. For the Year Ended March 31, 2015 the Board of Directors of the Company have recommended dividend of Rs. 0.40 Per Share (2014: Rs. 0.40) to Equity Shareholders and aggregating to Rs. 9.10 Crore (2014: Rs. 7.97 Crore) including Dividend Distribution Tax.

11. Previous Year''s Figures have been regrouped/reclassified wherever necessary to correspond with the current year''s classification/disclosure.

As per our report of even date attached For and on behalf of Board of Directors

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Mar 31, 2013

1) Contingent Liabilities not provided for Nil.

2) Estimated amount of contracts remaining to be executed on capital account and not provided for (net of advances) Rs. NIL.

3) Related Party Disclosures

Disclosures as required by Accounting Standard 18 "Related Party Disclosures" are given below: a) Name of related party

Holding Company:

Future Retail Limited { Formerly known as Pantaloon Retail (India) Limited} (w.e.f November 9,2012)

Future Value Retail Limited (Till November 8, 2012)

Fellow Subsidiary:

Future Value Retail Limited (w.e.f November 9,2012)

4) The Board of Directors of the Company have approved the Composite Scheme of Arrangement and Amalgamation between indus-League Clothing Limited ("ILCL"), Lee Cooper (India) Limited ("LEE"), Future Ventures India Limited("FViL"), Future Retail Limited (formerly known as Pantaloon Retail (India) Limited) and the Company and their respective shareholders and creditors ("Fashion Demerger Scheme5'').

The Appointed Date for the Fashion Demerger Scheme is January 1, 2013 and the scheme would be given effect on receipt of requisite approvals from statutory authorities.

5) There are no Micro, Small and Medium Enterprises, to whom the Company owes dues which are outstanding for more than 45 days during the period. This information as required to be disclosed under the Micro, Small and Medium Enterprise Development Act, 2006 has been determined to the extent such parties have been identified on the basis of information available with the Company.

6) in absence of virtual certainty of future taxable income, deferred tax asset has not been calculated on losses as per Income Tax Act, 1961.

7) Company was incorporated on May 13, 2012 and the first accounting period is from May 13, 2012 to March 31, 2013.