{"url_path":"/sec/frhc/10-k/2026/item-8","section_key":"item-8","section_title":"Item 8 FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA","topic":"sec","document":{"doc_type":"10-K","doc_date":"2026-06-01","source_url":"https://www.sec.gov/Archives/edgar/data/924805/0000924805-26-000012-index.html","accession_number":"0000924805-26-000012","cik":"0000924805","ticker":"FRHC","issuer_name":"Freedom Holding Corp.","edgar_url":"https://www.sec.gov/Archives/edgar/data/924805/0000924805-26-000012-index.html","primary_entity_key":"0000924805","primary_entity_name":"Freedom Holding Corp."},"word_count":40099,"has_tables":true,"body_markdown":"ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA\n\nFREEDOM HOLDING CORP.\n\nINDEX TO CONSOLIDATED FINANCIAL STATEMENTS\n\nPage\n\n[Report of Independent Registered Public Accounting Firm - Deloitte LLP (PCAOB ID No.](#i70ff496d74d2478e8fff6b413c2fcd4c_103)1056[)](#i70ff496d74d2478e8fff6b413c2fcd4c_103)\n\n[99](#i70ff496d74d2478e8fff6b413c2fcd4c_103)\n\n[Consolidated Balance Sheets as of March 31, 2026 and 2025](#i70ff496d74d2478e8fff6b413c2fcd4c_112)\n\n[104](#i70ff496d74d2478e8fff6b413c2fcd4c_112)\n\n[Consolidated Statements of Operations and Statements of Other Comprehensive Income for the years ended March 31, 2026, 2025 and 2024](#i70ff496d74d2478e8fff6b413c2fcd4c_115)\n\n[105](#i70ff496d74d2478e8fff6b413c2fcd4c_115)\n\n[Consolidated Statements of Shareholders' Equity for the years ended March 31, 2026, 2025 and 2024](#i70ff496d74d2478e8fff6b413c2fcd4c_118)\n\n[107](#i70ff496d74d2478e8fff6b413c2fcd4c_118)\n\n[Consolidated Statements of Cash Flows for the years ended March 31, 2026, 2025 and 2024](#i70ff496d74d2478e8fff6b413c2fcd4c_121)\n\n[109](#i70ff496d74d2478e8fff6b413c2fcd4c_121)\n\n[Notes to Audited Consolidated Financial Statements](#i70ff496d74d2478e8fff6b413c2fcd4c_124)\n\n[112](#i70ff496d74d2478e8fff6b413c2fcd4c_124)\n\n97\n\n[Table of](#i70ff496d74d2478e8fff6b413c2fcd4c_7)[Contents](#i70ff496d74d2478e8fff6b413c2fcd4c_7)\n\nREPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM\n\nTo the shareholders and the Board of Directors of Freedom Holding Corp.\n\nOpinion on the Financial Statements\n\nWe have audited the accompanying consolidated balance sheets of Freedom Holding Corp. and subsidiaries (the \"Group\") as of March 31, 2026 and 2025, the related consolidated statements of operations and other comprehensive income, shareholders' equity, and cash flows, for each of the three years in the period ended March 31, 2026, and the related notes (collectively referred to as the \"financial statements\"). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Group as of March 31, 2026 and 2025, and the results of its operations and its cash flows for each of the three years in the period ended March 31, 2026, in conformity with accounting principles generally accepted in the United States of America.\n\nWe have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Group's internal control over financial reporting as of March 31, 2026, based on criteria established in Internal Control — Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission and our report dated June 1, 2026, expressed an unqualified opinion on the Group's internal control over financial reporting.\n\nBasis for Opinion\n\nThese financial statements are the responsibility of the Group's management. Our responsibility is to express an opinion on the Group's financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Group in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.\n\nWe conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.\n\nCritical Audit Matter\n\nThe critical audit matter communicated below is a matter arising from the current-period audit of the financial statements that was communicated or required to be communicated to the audit committee and that (1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.\n\nRevenue recognition – Fee and commission income from brokerage services from one institutional brokerage customer – Refer to Notes 2, 7, 19 and 29 to the financial statements\n\nCritical Audit Matter Description\n\nAs discussed in Note 2, Note 7 and Note 19 to the financial statements, a substantial part of fee and commission income earned from Brokerage segment is generated from one institutional brokerage customer. The transactions from this institutional brokerage customer and from other customers of the Group are included in omnibus accounts with third party brokers where the Group may use the assets within these omnibus accounts to finance, lend, provide credit or provide debt financing or otherwise use and direct the order or manner of assets for financing of other customers of the Group. As a result, certain trades executed by customers of the Group are internalized by effectively matching customers’ purchase orders with short positions taken by the institutional brokerage customer within the omnibus accounts (the “internalized trades”).\n\nIn addition, as described in Note 29, the Group received a Wells Notice from the Securities and Exchange Commission (the “SEC”) in connection with an investigation which includes the Group’s accounting practices related to internalized trades.\n\n99\n\n[Table of](#i70ff496d74d2478e8fff6b413c2fcd4c_7)[Contents](#i70ff496d74d2478e8fff6b413c2fcd4c_7)\n\nWe identified recognition of fee and commission income from brokerage services as a critical audit matter due to the existence of these internalized trades which are settled through prime brokers or clearing firms. These internalized trades increase the complexity of the application of the requirements for revenue recognition under ASC 606, Revenue from Contracts with Customers (“ASC 606”) and ASC 940 Financial Services: Brokers and Dealers (“ASC 940”) specifically as to whether the Group has satisfied its performance obligations for these customers at the trade date when revenue is recognized and determining if the Group is acting as an agent for its customers or as a principal in these transactions. Furthermore, the internalized trades involve a significant volume of transactions which increase the risks of overstatement of fee and commission income from brokerage customers.\n\nHow the Critical Audit Matter Was Addressed in the Audit\n\nOur audit procedures included:\n\n•We evaluated the terms of the relevant agreements with customers and we considered if the conditions for revenue recognition in ASC 606 and ASC 940 were satisfied at the trade date which is when revenue is recognized for these internalized trades. Furthermore, we evaluated if the Group is acting as an agent or principal in these transactions.\n\n•We tested a sample of transactions placed both by customers and institutional brokerage customer and how these transactions are reflected in the omnibus accounts. We tested that the revenue recognition for these contracts was in accordance with the requirement in ASC 606 and ASC 940. We also confirmed that these transactions were individually transmitted and settled through a prime broker.\n\n•With the assistance of our professionals with expertise in IT, we identified the significant systems used to process the trading orders, the fee and commission income from brokerage customers and tested the general IT controls over each of these systems, including testing of user access controls, change management controls, and IT operations controls.\n\n•We tested automated controls within the fee and commission income from brokerage customers stream, including the controls designed to ensure the completeness and accuracy of the income.\n\n•We tested automated controls over trading acceptance and operation of the omnibus accounts.\n\n•We tested automated controls over the routing of customer orders to prime brokers.\n\n•We tested samples of transactions recorded to confirm the existence of the customer and the occurrence and existence of the relevant transactions in our sample.\n\n•We tested other internal controls within fee and commission income from brokerage customers stream, including controls designed to reconcile the income from the source document to the general ledger.\n\n•We performed substantive testing, for a sample of transactions, where we agreed the amounts of revenue recognized to source documents and tested the mathematical accuracy of the recorded revenue.\n\n•We obtained and read the Wells Notice and the Group’s response submission to the SEC and evaluated whether the Group’s disclosures in the financial statements were consistent with the Group’s response to the Wells Notice.\n\n•We obtained and read a legal opinion issued by one of the Group’s external legal counsel regarding what the Group’s performance obligations are in relation to its brokerage customers contracts and how these apply to the internalized trades.\n\nContingencies – SEC Wells Notice – Refer to Notes 2 and 29 to the financial statements\n\nCritical Audit Matter Description\n\nAs discussed in Note 2, the Group recognizes a liability when a loss is considered probable and the amount can be reasonably estimated. If a material loss contingency is reasonably possible but not probable, the Group does not record a liability but discloses the nature and amount of the claim, as well as an estimate of the potential loss, if such an estimate can be determined. As discussed in Note 29, the Company and Company’s controlling shareholder, chairman and chief executive officer, Timur Turlov received a Wells Notice from the SEC staff. The Wells Notice provides that the SEC staff has made a \"preliminary determination\" to recommend that the SEC file a civil enforcement action against the recipients alleging violations of certain provisions of the U.S. federal securities laws. As at March 31, 2026 management concluded that they cannot reasonably estimate the reasonably possible loss (or range of loss), if any, and other possible consequences from an enforcement action.\n\nThe principal considerations for our determination that performing procedures relating to the contingent liabilities from legal proceedings related to the Wells Notice is a critical audit matter are (i) the significant judgment by management when assessing whether a liability from a contingency is probable or possible and when determining a loss or range of loss can be reasonably estimated; (ii) a significant degree of audit judgment and effort in obtaining and evaluating the audit evidence related to management's assessment of the contingent liabilities; and (iii) the audit effort involved in the use of professionals with specialized skills and knowledge.\n\n100\n\n[Table of](#i70ff496d74d2478e8fff6b413c2fcd4c_7)[Contents](#i70ff496d74d2478e8fff6b413c2fcd4c_7)\n\nHow the Critical Audit Matter Was Addressed in the Audit\n\nOur audit procedures included:\n\n•We obtained and read the Wells Notice and the Company’s response submissions to the SEC.\n\n•We obtained an understanding of the status of ongoing discussions with the SEC through management inquiries, meeting with internal and external legal counsel and inspection of relevant documentation.\n\n•We evaluated the design and tested the operating effectiveness of controls relating to management's assessment of contingencies, including controls over assessing whether a liability from a contingency is reasonably possible or probable and when determining whether the amount can be reasonably estimated, as well as the related financial statement disclosures.\n\n•We confirmed with internal and external legal counsel the possibility or probability of an unfavorable outcome and the extent to which a loss or range of loss is reasonably estimable.\n\n•We evaluated the reasonableness of management's assessment regarding whether an unfavorable outcome is reasonably possible or probable and reasonably estimable.\n\n•We evaluated the sufficiency of the Group's contingent liability disclosure related to the Wells Notice and consistency with the Company’s response to the Wells Notice.\n\nAdoption of Long-Duration Targeted Improvements (“LDTI”) - Refer to Notes 2, 3 and 17 to the financial statements\n\nCritical Audit Matter Description\n\nAs discussed in Note 2, Note 3 and Note 17, effective for annual periods beginning April 1, 2025, the Group adopted ASU 2018-12 Long-Duration Targeted Improvements using the modified retrospective transition method with a transition date of April 1, 2023, which affected the measurement and presentation of long-duration insurance contracts.\n\nLDTI revised the accounting guidance for long-duration insurance contracts by introducing changes to the recognition, measurement, presentation, and disclosure requirements applicable to the Group. The principal changes include periodic updating of cash flow assumptions used in measuring the liability for future policy benefits (“LFPB”), updates of discount rate assumptions, recognition of assumption changes within insurance claims and policyholder benefits, net of reinsurance, and recognition of discount rate impacts through other comprehensive income. The standard also replaced the previous deferred acquisition costs (“DAC”) amortization approach with a constant-level amortization method over the expected contract term and expanded disclosure requirements through enhanced rollforwards and disaggregated presentation of LFPB and DAC balances. As a result of the adoption, the consolidated financial statements as of and for the years ended March 31, 2025 and 2024 have been adjusted to reflect the effects of applying the new standard.\n\nWe identified the adoption of the new standard for long-duration targeted improvements as a critical audit matter due to (i) the judgements made by management when adopting the LDTI standard and determining the adjustments, (ii) a high degree of auditor judgment and subjectivity in performing procedures and evaluating audit evidence related to management's discount rate methodology, development of the discount rate curve used in determining the LFPB and economic and policyholder behavior assumptions, (iii) the audit effort involved the use of professionals with specialized skills and knowledge.\n\n101\n\n[Table of](#i70ff496d74d2478e8fff6b413c2fcd4c_7)[Contents](#i70ff496d74d2478e8fff6b413c2fcd4c_7)\n\nHow the Critical Audit Matter Was Addressed in the Audit\n\nOur audit procedures included:\n\n•We involved senior, more experienced audit team members, including actuarial specialists, to plan and perform audit procedures.\n\n•We tested the operating effectiveness of controls, including those related to the adoption of the new accounting standard for LDTI.\n\n•We evaluated the appropriateness of the Company's accounting policies, methodologies, and elections involved in the adoption of the LDTI.\n\n•We involved our actuarial specialists, to assist us in evaluating the reasonableness and conceptual soundness of the methodology and significant assumptions.\n\n•We evaluated the new ongoing disclosures and the disclosures related to transition impact and reconciled the disclosures to underlying accounting records and supporting data.\n\n/s/ Deloitte LLP\n\nAlmaty, Kazakhstan\n\nJune 1, 2026\n\nWe have served as the Group's auditor since 2022.\n\n102\n\nTable of Contents\n\nREPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM\n\nTo the shareholders and the Board of Directors of Freedom Holding Corp.\n\nOpinion on Internal Control over Financial Reporting\n\nWe have audited the internal control over financial reporting of Freedom Holding Corp. and subsidiaries (the “Group”) as of March 31, 2026, based on criteria established in Internal Control — Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). In our opinion, the Group maintained, in all material respects, effective internal control over financial reporting as of March 31, 2026, based on criteria established in Internal Control — Integrated Framework (2013) issued by COSO.\n\nWe have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated financial statements as of and for the year ended March 31, 2026, of the Group and our report dated June 1, 2026, expressed an unqualified opinion on those financial statements.\n\nAs described in Management's Report on Internal Control over Financial Reporting, management excluded from its assessment the internal control over financial reporting at Astel Group Ltd. (renamed Freedom Cloud Holding Ltd. on January 8, 2026) (the “Acquired Company”), which was acquired on April 30, 2025, and whose financial statements constitute, 0.3% of total consolidated assets and 1.1% of total consolidated revenues of the consolidated financial statement amounts as of and for the year ended March 31, 2026, respectively. Accordingly, our audit did not include the internal control over financial reporting at the Acquired Company.\n\nBasis for Opinion\n\nThe Group's management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management's Report on Internal Control over Financial Reporting. Our responsibility is to express an opinion on the Group's internal control over financial reporting based on our audit. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Group in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.\n\nWe conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.\n\nDefinition and Limitations of Internal Control over Financial Reporting\n\nA company's internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company's internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company's assets that could have a material effect on the financial statements.\n\nBecause of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.\n\n/s/ Deloitte LLP\n\nAlmaty, Kazakhstan\n\nJune 1, 2026\n\n103\n\nTable of Contents\n\nFREEDOM HOLDING CORP.\n\nCONSOLIDATED BALANCE SHEETS\n\n(All amounts in thousands of United States dollars, unless otherwise stated)\n\nMarch 31, 2026March 31, 2025 (Recasted)\n\nASSETS\n\nCash and cash equivalents\n$966,115 $837,302 \n\nRestricted cash\n1,246,312 807,468 \n\nInvestment securities\n3,342,561 2,814,733 \n\nMargin lending, brokerage and other receivables, net\n4,690,782 3,319,145 \n\nLoans issued (including $21,321 and $188,445 to related parties)\n2,077,606 1,595,435 \n\nFixed assets, net358,396 191,103 \n\nIntangible assets, net73,319 54,186 \n\nGoodwill51,099 49,093 \n\nRight-of-use asset47,579 39,828 \n\nInsurance contract assets36,849 37,183 \n\nOther assets, net (including $40,119 and $18,080 with related parties)\n264,621 169,641 \n\nTOTAL ASSETS$13,155,239 $9,915,117 \n\nLIABILITIES AND SHAREHOLDERS' EQUITY\n\nSecurities repurchase agreement obligations$1,024,923 $1,418,443 \n\nCustomer liabilities\n7,103,984 4,304,999 \n\nMargin lending and trade payables\n689,641 1,322,241 \n\nInsurance contract liabilities653,907 472,433 \n\nCurrent income tax liability43,701 28,919 \n\nDebt securities issued1,261,120 469,551 \n\nLease liability48,843 40,525 \n\nLiability arising from continuing involvement554,594 503,705 \n\nOther liabilities\n285,247 129,737 \n\nTOTAL LIABILITIES$11,665,960 $8,690,553 \n\nCommitments and Contingent Liabilities (Note 29)— — \n\nSHAREHOLDERS' EQUITY\n\nPreferred stock - $0.001 par value; $20,000,000 shares authorized, no shares issued or outstanding\n— — \n\nCommon stock - $0.001 par value; 500,000,000 shares authorized; 61,292,581 and 60,993,949 shares issued and outstanding as of March 31, 2026 and March 31, 2025, respectively\n61 61 \n\nAdditional paid in capital314,657 246,610 \n\nRetained earnings1,231,500 1,078,172 \n\nAccumulated other comprehensive loss(56,939)(100,396)\n\nTOTAL FRHC SHAREHOLDERS' EQUITY$1,489,279 $1,224,447 \n\nNon-controlling interest— 117 \n\nTOTAL SHAREHOLDERS' EQUITY\n$1,489,279 $1,224,564 \n\nTOTAL LIABILITIES AND SHAREHOLDERS' EQUITY\n$13,155,239 $9,915,117 \n\nThe accompanying notes are an integral part of these consolidated financial statements\n\n104\n\nTable of Contents\n\nFREEDOM HOLDING CORP.\n\nCONSOLIDATED STATEMENTS OF OPERATIONS AND STATEMENTS OF OTHER COMPREHENSIVE INCOME\n\n(All amounts in thousands of United States dollars, unless otherwise stated)\n\nYears ended March 31,\n\n20262025 (Recasted)2024 (Recasted)\n\nRevenue:  \n\nFee and commission income (including $7,680, $4,725 and $65,972 from related parties)\n$489,765 $505,026 $440,333 \n\nNet gain/(loss) on trading securities158,824 (57,810)133,854 \n\nInterest income (including $12,703 , $1,731 and $24,941 from related parties)\n882,478 864,453 828,224 \n\nNet insurance revenue 402,396 571,224 245,122 \n\nNet gain on foreign exchange operations67,680 51,684 72,245 \n\nNet gain/(loss) on derivatives66,772 12,404 (103,794)\n\nSales of goods and services97,446 40,102 21,576 \n\nOther income25,930 17,072 9,696 \n\nTOTAL REVENUE, NET2,191,291 2,004,155 1,647,256 \n\nExpense:\n\nFee and commission expense\n218,565 346,502 154,716 \n\nInterest expense\n489,036 535,895 501,111 \n\nInsurance claims and policyholder benefits, net of reinsurance259,309 260,488 117,273 \n\nPayroll and bonuses426,471 287,347 180,283 \n\nProfessional services46,258 28,924 34,238 \n\nStock compensation expense68,047 59,592 22,719 \n\nAdvertising and sponsorship expense (including $27,151,$18,497, and — from related parties)\n103,304 124,627 38,327 \n\nGeneral and administrative expense222,339 162,474 120,888 \n\nAllowance for expected credit losses52,365 62,445 21,225 \n\nCost of sales79,632 31,278 17,538 \n\nTOTAL EXPENSE1,965,326 1,899,572 1,208,318 \n\nINCOME BEFORE INCOME TAX225,965 104,583 438,938 \n\nIncome tax expense(72,637)(28,425)(60,419)\n\nNET INCOME 153,328 76,158 378,519 \n\nLess: Net loss attributable to non-controlling interest in subsidiary— (129)(588)\n\nNET INCOME ATTRIBUTABLE TO COMMON SHAREHOLDERS$153,328 $76,287 $379,107 \n\nOTHER COMPREHENSIVE INCOME\n\nChange in unrealized (loss)/gain on investments available-for-sale, net of tax effect (4,771)4,364 6,196 \n\n105\n\nTable of Contents\n\nFREEDOM HOLDING CORP.\n\nCONSOLIDATED STATEMENTS OF OPERATIONS AND STATEMENTS OF OTHER COMPREHENSIVE INCOME\n\n(All amounts in thousands of United States dollars, unless otherwise stated)\n\nReclassification adjustment for net realized (gain)/loss on available-for-sale investments disposed of in the period, net of tax effect(4,937)681 (3,209)\n\nChange in discount rate on liability for future policy benefits(881)6,807 (4,811)\n\nForeign currency translation adjustments54,046 (104,102)12,075 \n\nOTHER COMPREHENSIVE INCOME/(LOSS)43,457 (92,250)10,251 \n\nCOMPREHENSIVE INCOME/(LOSS) BEFORE NON-CONTROLLING INTERESTS$196,785 $(16,092)$388,770 \n\nLess: Comprehensive loss attributable to non-controlling interest in subsidiary— (129)(588)\n\nCOMPREHENSIVE INCOME/(LOSS) ATTRIBUTABLE TO COMMON SHAREHOLDERS$196,785 $(15,963)$389,358 \n\nEARNINGS PER COMMON SHARE (In U.S. dollars):\n\nEarnings per common share - basic2.56 1.28 6.43 \n\nEarnings per common share - diluted2.51 1.26 6.39 \n\nWeighted average number of shares (basic)59,992,357 59,393,629 58,958,363 \n\nWeighted average number of shares (diluted)61,117,931 60,490,564 59,362,982 \n\nThe accompanying notes are an integral part of these consolidated financial statements.\n\n106\n\nTable of Contents\n\nFREEDOM HOLDING CORP.\n\nCONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY\n\n(All amounts in thousands of United States dollars, unless otherwise stated)\n\nCommon StockAdditional\npaid in capitalRetained earningsAccumulated other comprehensive lossTotal equity attributable to the shareholders'Non-controlling interestTotal\n\nSharesAmount\n\nAt March 31, 2023 (As reported)\n59,659,191 $59 $164,162 $647,064 $(34,000)$777,285 $(6,549)$770,736 \n\nCumulative effect of adoption of ASU 2018-12— — — (2,597)15,603 13,006 — 13,006 \n\nAt March 31, 2023 (Recasted)\n59,659,191 $59 $164,162 $644,467 $(18,397)$790,291 $(6,549)$783,742 \n\nCumulative adjustment from adoption of ASC 326— — — (22,772)— (22,772)— (22,772)\n\nStock based compensation662,622 1 19,626 — — 19,627 — 19,627 \n\nDisposal of FF Ukraine— — — (6,549)— (6,549)6,549 — \n\nPurchase of Arbuz shares— — — 5,457 — 5,457 3,640 9,097 \n\nPurchase of ReKassa shares— — — — — — 256 256 \n\nOther comprehensive income— — — — (1,824)(1,824)— (1,824)\n\nForeign currency translation adjustments, net of tax effect— — — — 12,075 12,075 — 12,075 \n\nNet income/(loss)— — — 379,107 — 379,107 (588)378,519 \n\nAt March 31, 2024 (Recasted)\n60,321,813 $60 $183,788 $999,710 $(8,146)$1,175,412 $3,308 $1,178,720 \n\nDelivered stock awards from previous year215,878 — 3,092 — — 3,092 — 3,092 \n\nForfeited stock based compensation(310,700)— — — — — — — \n\nStock based compensation765,958 1 59,592 — — 59,593 — 59,593 \n\nOther compensation1,000 — 138 — — 138 — 138 \n\nPurchase of Arbuz shares— — — 2,175 — 2,175 (3,062)(887)\n\nOther comprehensive income— — — — 11,852 11,852 — 11,852 \n\nForeign currency translation adjustments, net of tax effect— — — — (104,102)(104,102)— (104,102)\n\nNet income/(loss)— — — 76,287 — 76,287 (129)76,158 \n\nAt March 31, 2025 (Recasted)\n60,993,949 $61 $246,610 $1,078,172 $(100,396)$1,224,447 $117 $1,224,564 \n\nForfeited stock based compensation(82,906)— — — — — — — \n\nStock based compensation381,538 — 68,047 — — 68,047 — 68,047 \n\n107\n\nTable of Contents\n\nSale of Comrun LLP— — — — — — (117)(117)\n\nOther comprehensive income\n— — — — (10,589)(10,589)— (10,589)\n\nForeign currency translation adjustments, net of tax effect— — — — 54,046 54,046 — 54,046 \n\nNet income— — — 153,328 — 153,328 — 153,328 \n\nAt March 31, 2026\n61,292,581 $61 $314,657 $1,231,500 $(56,939)$1,489,279 $— $1,489,279 \n\nThe accompanying notes are an integral part of these consolidated financial statements.\n\n108\n\nTable of Contents\n\nFREEDOM HOLDING CORP.\n\nCONSOLIDATED STATEMENTS OF CASH FLOWS\n\n(All amounts in thousands of United States dollars, unless otherwise stated)\n\nFor the years ended\n\nMarch 31, 2026March 31, 2025March 31, 2024\n\n(Recasted)(Recasted)\n\nCash Flows From Operating Activities\n\nNet income153,328 $76,158 $378,519 \n\nAdjustments to reconcile net income used in operating activities:\n\nDepreciation and amortization34,560 17,158 14,603 \n\nAmortization of deferred acquisition costs\n127,641 209,689 49,635 \n\nNoncash lease expense18,104 14,468 9,980 \n\nChange in deferred taxes(12,297)(19,705)800 \n\nStock compensation expense68,047 59,592 22,719 \n\nUnrealized loss/(gain) on trading securities5,139 123,665 (95,729)\n\nUnrealized (gain)/loss on derivatives(13,894)(7,415)3,009 \n\nNet realized (gain)/loss on available-for-sale securities(4,937)681 (3,209)\n\nGain from sale of Comrun LLP(1,636)— — \n\nGain from sale of ITS Tech— (4,201)— \n\nRevaluation of investments in associates1,044 (1,139)— \n\nNet change in accrued interest35,172 97,286 (69,289)\n\nLoss on sale of fixed assets141 — — \n\nChange in insurance reserves147,373 228,568 95,595 \n\nRevaluation of purchase price previously held interest in Arbuz\n— — (1,040)\n\nChange in unused vacation reserve\n9,635 2,577 5,860 \n\nAllowances for expected credit losses\n52,365 62,445 21,225 \n\nOther non-cash income/expense(129)— — \n\nChanges in operating assets and liabilities:\n\nTrading securities24,614 827,157 (1,048,205)\n\nMargin lending, brokerage and other receivables (including $(19,041), $41,934, and $(108,275) changes from related parties)\n(1,203,073)(1,743,595)(1,272,652)\n\nInsurance contract assets(13,899)(15,319)(5,930)\n\nOther assets(175,350)(268,976)(74,872)\n\nBrokerage customer liabilities (including $46,647, $48,161, and $(325,904) changes from related parties)\n1,597,220 1,516,767 112,258 \n\nCurrent income tax liability14,611 (4,090)28,432 \n\nMargin lending and trade payables (including $(471), $1,789, and $(39,371) changes from related parties)\n(730,025)474,087 734,605 \n\nLease liabilities(17,730)(13,699)(10,433)\n\nLiabilities from insurance activity(988)4,911 6,927 \n\nOther liabilities70,185 43,988 32,830 \n\nNet cash flows from/(used in) operating activities\n185,221 1,681,058 (1,064,362)\n\nCash Flows From Investing Activities\n\nPurchase of fixed assets(198,766)(80,902)(36,735)\n\n109\n\nTable of Contents\n\nFREEDOM HOLDING CORP.\n\nCONSOLIDATED STATEMENTS OF CASH FLOWS\n\n(All amounts in thousands of United States dollars, unless otherwise stated)\n\nPurchase of intangible assets(23,375)(14,426)(7,016)\n\nNet change in loans issued to customers(412,193)(435,759)(569,151)\n\nPurchase of available-for-sale securities, at fair value(452,062)(457,698)(229,912)\n\nProceeds from sale of available-for-sale securities, at fair value382,493 174,428 260,336 \n\nPurchase of held-to-maturity securities(324,311)(67,550)— \n\nConsideration paid for acquisitions(13,150)(18,784)(34,513)\n\nCash, cash equivalents and restricted cash received from acquisitions7,631 93 2,464 \n\nCapital contribution to investment in associate(100)(2,530)— \n\nCash received from sale of subsidiaries2,452 2,000 — \n\nCash, cash equivalents disposed from sale of subsidiaries(55)(542)— \n\nPrepayment on acquisitions(17,719)(19,122)(21,708)\n\nRefund of prepayment on acquisition— 15,320 — \n\nCash, cash equivalents and restricted cash disposed as a result of deconsolidation of Freedom UA\n— — (1,987)\n\nNet cash flows used in investing activities(1,049,155)(905,472)(638,222)\n\nCash Flows From Financing Activities\n\nNet (repayment)/proceeds from securities repurchase agreement obligations(431,540)(1,061,430)1,191,219 \n\nProceeds from issuance of debt securities783,515 201,663 206,344 \n\nSettlement and repurchase of mortgage loans under the State Program(60,031)(54,717)(41,768)\n\nFunds received under state program for financing of mortgage loans64,712 81,359 101,926 \n\nNet change in bank customer deposits770,449 829,072 217,561 \n\nPurchase of non-controlling interest in Arbuz\n— — (3,228)\n\nNet proceeds from loans received64,524 2,475 2,518 \n\nNet cash flows (used in)/from financing activities\n1,191,629 (1,578)1,674,572 \n\nEffect of changes in foreign exchange rates on cash and cash equivalents and restricted cash241,143 (137,038)12,194 \n\nEffect of expected credit losses on cash and cash equivalents and restricted cash\n(1,181)79 (3,406)\n\nNET CHANGE IN CASH, CASH EQUIVALENTS AND RESTRICTED CASH567,657 637,049 (19,224)\n\nCASH, CASH EQUIVALENTS AND RESTRICTED CASH, BEGINNING OF PERIOD1,644,770 1,007,721 1,026,945 \n\nCASH, CASH EQUIVALENTS AND RESTRICTED CASH, END OF PERIOD$2,212,427 $1,644,770 $1,007,721 \n\n110\n\nTable of Contents\n\nFREEDOM HOLDING CORP.\n\nCONSOLIDATED STATEMENTS OF CASH FLOWS\n\n(All amounts in thousands of United States dollars, unless otherwise stated)\n\nFor the years ended\n\nMarch 31, 2026March 31, 2025March 31, 2024\n\n \n\nSupplemental disclosure of cash flow information:  \n\nCash paid for interest$452,976 $511,954 $474,656 \n\nIncome taxes paid$81,300 $53,922 $30,319 \n\nSupplemental non-cash disclosures:\n\nOperating lease right-of-use assets obtained/disposed of in exchange for operating lease obligations during the period, net$18,421 $14,755 $11,061 \n\nThe following table provides a reconciliation of cash, cash equivalents, and restricted cash reported within the consolidated balance sheets that sum to the total of the same such amounts shown in the consolidated statements of cash flows:\n\nMarch 31, 2026March 31, 2025March 31, 2024\n\nCash and cash equivalents$966,115 $837,302 $545,084 \n\nRestricted cash$1,246,312 $807,468 $462,637 \n\nTotal cash, cash and cash equivalents and restricted cash shown in the statement of cash flows$2,212,427 $1,644,770 $1,007,721 \n\nThe accompanying notes are an integral part of these consolidated financial statements\n\n111\n\n[Table of Contents](#i70ff496d74d2478e8fff6b413c2fcd4c_7)\n\nFREEDOM HOLDING CORP.\n\nNOTES TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS MARCH 31, 2026\n\n(All amounts in thousands of United States dollars, except share data, unless otherwise stated)\n\nNOTE 1 - DESCRIPTION OF BUSINESS\n\nOverview\n\nFreedom Holding Corp. (\"FRHC\" and, together with its subsidiaries, the \"Company\" or the \"Group\") is a corporation organized in the United States under the laws of the State of Nevada that through its operating subsidiaries provides securities brokerage, securities dealing for customers and for our own account, market making activities, investment research, investment counseling, retail and commercial banking, insurance products, payment services information, processing services and lifestyle services. The Company also owns several ancillary businesses, which complement its core financial services businesses, including telecommunications and media businesses in Kazakhstan that are in a developmental stage. FRHC is the holding company of subsidiaries incorporated in Kazakhstan, Cyprus, the United States (USA), the United Kingdom (UK), Armenia, the United Arab Emirates (UAE), Uzbekistan, Kyrgyzstan, Tajikistan, Azerbaijan, Türkiye, Bulgaria, Germany, Greece, Lithuania, The Netherlands, Portugal, Spain, Austria, France and Poland and the Group also has a representative office in Italy. FRHC's subsidiaries in the United States include a broker-dealer that is registered with the United States Securities and Exchange Commission (\"SEC\") and the Financial Industry Regulatory Authority (\"FINRA\"). FRHC's common stock is traded on the Nasdaq Capital Market, the Kazakhstan Stock Exchange (\"KASE\"), and the Astana International Exchange (\"AIX\"). FRHC's common stock is included in Russell 3000® Index.\n\nAs of March 31, 2026, FRHC owned, directly or indirectly, the following subsidiaries:\n\nName of subsidiaryJurisdiction of Incorporation\nBusiness Area(1)\n\nBrokerage Segment\n\nFreedom Finance JSC (\"Freedom KZ\")\nKazakhstanSecurities broker-dealer\n\nFreedom Finance Global PLC (\"Freedom Global\")\nKazakhstanSecurities broker-dealer\n\nFreedom Finance Europe Limited (\"Freedom EU\")CyprusSecurities broker-dealer\n\nFreedom Finance Armenia LLC (\"Freedom AR\")ArmeniaSecurities broker-dealer\n\nPrime Executions, Inc. (d/b/a Freedom Capital Markets) (\"FCM\")USASecurities broker-dealer\n\nForeign Enterprise LLC Freedom FinanceUzbekistanSecurities broker-dealer\n\nFreedom Broker LLCKyrgyzstanSecurities broker-dealer\n\nFreedom Broker Global Markets LtdUAESecurities broker-dealer\n\nFREEDOM YATIRIM MENKUL DEĞERLER ANONİM ŞİRKETİTürkiyeSecurities broker-dealer\n\nBanking Segment\n\nFreedom Bank Kazakhstan JSC (\"Freedom Bank KZ\")\nKazakhstanCommercial bank\n\nFreedom Bank Tajikistan CJSC (\"Freedom Bank TJ\")\nTajikistanCommercial bank\n\nOUSA Nova LLPKazakhstanStress asset management company\n\nInsurance Segment\n\nLIC Freedom Life JSC (\"Freedom Life\")\nKazakhstanLife/health insurance\n\nFreedom Finance Insurance JSC (\"Freedom Insurance\")KazakhstanGeneral insurance\n\nOther segment\n\nTicketon Events LLP (\"Ticketon\")KazakhstanOnline ticket sales\n\nChiptahoi Muosir LLCTajikistanOnline ticket sales\n\nTicketon Events KG LLCKyrgyzstanOnline ticket sales\n\nTicketon LLCUzbekistanOnline ticket sales\n\nFreedom Digital Exchange CJSCKyrgyzstan\nDigital asset services\n\nFreedom Finance Special Purpose Company LTD (\"Freedom SPC\")KazakhstanIssuance of debt securities\n\n112\n\n[Table of Contents](#i70ff496d74d2478e8fff6b413c2fcd4c_7)\n\nFREEDOM HOLDING CORP.\n\nNOTES TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS MARCH 31, 2026\n\n(All amounts in thousands of United States dollars, except share data, unless otherwise stated)\n\nFreedom Finance Commercial LLPKazakhstanSales consulting\n\nFreedom Technologies LLP (\"Paybox\")KazakhstanPayment services\n\nFreedom Processing LLPKazakhstanIT solutions and products processes data for payment services\n\nFreedom Pay LLPKazakhstanPayment platform\n\nPaybox Money LLPKazakhstanImplementation of payment services\n\nFreedom Pay Tajikistan LLCTajikistanBank Payment Agent\n\nFreedom Pay Kyrgyzstan LLC\nKyrgyzstanProvision of payment services\n\nFreedom Payments LLCUzbekistanProvision of payment services\n\nAviata LLP (\"Aviata\")\nKazakhstanOnline travel ticket aggregator\n\nInternet-Tourism LLPKazakhstanOnline travel ticket aggregator\n\nArbuz Group LLP (\"Arbuz\")KazakhstanOnline retail trade and e-commerce\n\nPrime Retail LLPKazakhstanOnline retail trade and e-commerce\n\nRetail Prime Astana LLPKazakhstanOnline retail trade and e-commerce\n\nArbuz Pharma LLPKazakhstanRetail (pharmaceuticals)\n\nFreedom Telecom Holding Limited (\"Freedom Telecom\")KazakhstanTelecommunications\n\nFreedom Telecom Operations LLPKazakhstanWireless telecommunications\n\nFreedom Media LLP (\"Freedom Media\")\nKazakhstanMedia and entertainment\n\nFreedom Cloud LLP (\"Freedom Cloud\")\nKazakhstanTelecommunications\n\nSilkNetCom LLP (\"SilkNetCom\")\nKazakhstanTelecommunications\n\nElitecom LLP\nKazakhstanTelecommunications\n\nFreedom Cloud Holding Ltd. (formerly, Astel Group Ltd., renamed on January 8, 2026) (\"Freedom Cloud Holding\")KazakhstanHolding company\n\nArna-Sprint Data Communications JSCKazakhstanRental and leasing of other personal items and household goods\n\nAstel JSCKazakhstanOther wireless telecommunications\n\nFreedom Kazakhstan Ltd.\nKazakhstanHolding company\n\nFreedom Advertising Ltd. (\"Freedom Advertising\")\nKazakhstanAdvertising\n\nFreedom Shapagat Corporate FundKazakhstanNon-profit organization\n\nFreedom Holding Operations LLPKazakhstanHiring and recruitment\n\nFreedom Horizons LLPKazakhstanBusiness consulting and services\n\nCLUB T LLPKazakhstanRestaurant and cafe operations\n\nCLUB T ASTANA LLPKazakhstanRestaurant and cafe operations\n\nFreedom Events LLPKazakhstanConcert and events organizations\n\nFreedom Tech Ltd.\nKazakhstanIT services\n\nFreedom Ventures Ltd.\nKazakhstanInvestment company\n\nFreedom Home LLPKazakhstanHousing and utilities software solutions\n\nFreedom Auto LLPKazakhstanE-commerce and logistics\n\nFreedom Travel LLPKazakhstanTravel agency operations\n\nFreedom Media Group LtdKazakhstanHolding company\n\nFreedom Finance Azerbaijan LLCAzerbaijanFinancial educational center\n\nFreedom Finance FZEUAEConsulting\n\nFreedom Management Ltd.UAEConsulting\n\nFreedom Telecom International FZE\nUAETelecommunications\n\nFreedom Finansial Hizmetler Anonim ŞirketiTürkiyeFinancial consulting\n\nFreedom Finance Technologies LtdCyprusIT development\n\nFreedom Prime UK Limited\nUKManagement consulting\n\n113\n\n[Table of Contents](#i70ff496d74d2478e8fff6b413c2fcd4c_7)\n\nFREEDOM HOLDING CORP.\n\nNOTES TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS MARCH 31, 2026\n\n(All amounts in thousands of United States dollars, except share data, unless otherwise stated)\n\nFreedom Finance Germany GmbHGermany\nTied Agent of Freedom EU\n\nFreedom Structured Products PLC (\"FSP\")CyprusFinancial services\n\nFreedom24 Chess Masters LTDCyprusChess academy\n\nFreedom Property LtdCyprusAsset management company\n\nFreedom24 Bulgaria VCCBulgaria\nTied Agent of Freedom EU\n\nFreedom24 Greece Single Members P.CGreece\nTied Agent of Freedom EU\n\nFreedom24 Poland LTDPoland\nTied Agent of Freedom EU\n\nFreedom24 Lithuania, UABLithuania\nTied Agent of Freedom EU\n\nFreedom24 Iberia SLSpain\nTied Agent of Freedom EU\n\nFreedom24 Netherlands B.V.Netherlands\nTied Agent of Freedom EU\n\nFreedom24 Austria GmbHAustria\nTied Agent of Freedom EU\n\nFreedom24 France\nFrance\n\nTied Agent of Freedom EU\n\nFreedom24 Portugal, LDAPortugal\nTied Agent of Freedom EU\n\nFreedom24 CCyprusEMI license acquisition\n\nFreedom24 PCyprusEMI license acquisition\n\nFFIN Securities, Inc.USADormant\n\nFreedom U.S. Market LLCUSAManagement company\n\nLD Micro, Inc.USAEvent platform\n\nFreedom US Technologies LLCUSATechnology services\n\nTotal subsidiaries83\n\n(1)    The classification of subsidiaries under the heading \"Business Area\" does not constitute, imply, or represent that any such subsidiary holds, or is required to hold, any license, registration, consent, or other regulatory authorization in respect of the relevant business activities.\n\nThrough its subsidiaries, the Company offers a diverse range of financial services, including banking, brokerage, and insurance. The Company also provides lifestyle services such as online payments, travel, ticketing, e-commerce, and telecommunications and media businesses in Kazakhstan that are in a developmental stage. It operates as a professional participant in the financial markets, holding banking and insurance licenses, as well as licenses to provide various services across multiple stock exchanges, including the KASE and the AIX, the Republican Stock Exchange of Tashkent, and the Uzbek Republican Currency Exchange. Additionally, our U.S. subsidiary FCM it is a member of the New York Stock Exchange (\"NYSE\") and the Nasdaq Stock Exchange (\"Nasdaq\"). Freedom EU enhances the Company's offerings by providing customers with operational support and access to investment opportunities in the United States and the European securities markets.\n\nNOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES\n\nAccounting principles\n\nThe Group's accounting policies and accompanying consolidated financial statements conform to accounting principles generally accepted in the United States of America (U.S. GAAP).\n\nBasis of presentation and principles of consolidation\n\nThe consolidated financial statements present the consolidated accounts of FRHC and its consolidated subsidiaries. All inter-company balances and transactions have been eliminated from the consolidated financial statements.\n\nPrior Period Reclassifications\n\nCertain prior-period amounts have been reclassified and disaggregated to conform to the current-period presentation. In the consolidated statements of cash flows, purchases of intangible assets are now presented separately within cash flows from investing activities. This is a presentation reclassification/disaggregation rather than a change in accounting principle or an\n\n114\n\n[Table of Contents](#i70ff496d74d2478e8fff6b413c2fcd4c_7)\n\nFREEDOM HOLDING CORP.\n\nNOTES TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS MARCH 31, 2026\n\n(All amounts in thousands of United States dollars, except share data, unless otherwise stated)\n\nerror correction, as it did not affect previously reported net income, comprehensive income, total assets, total liabilities, equity, or net cash provided by or used in operating, investing or financing activities.\n\nConsolidation of variable interest entities\n\nIn accordance with accounting standards regarding consolidation of variable interest entities (\"VIEs\"), VIEs are generally entities that lack sufficient equity to finance their activities without additional financial support from other parties or whose equity holders lack adequate decision making ability. VIEs must be evaluated to determine the primary beneficiary of the risks and rewards of the VIE. The primary beneficiary is required to consolidate the VIE for financial reporting purposes. As of March 31, 2026 there are no VIEs in respect of the Company.\n\nUse of estimates\n\nThe preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Management believes that the estimates utilized in preparing the Group's financial statements are reasonable and prudent. Actual results could differ from those estimates.\n\nRevenue and expense recognition\n\nAccounting Standards Codification (\"ASC\") Topic 606, Revenue from Contracts with Customers (\"ASC Topic 606\"), establishes principles for reporting information about the nature, amount, timing and uncertainty of revenue and cash flows arising from the entity's contracts to provide goods or services to customers. The core principle requires an entity to recognize revenue to depict the transfer of goods or services promised to customers in an amount that reflects the consideration that it expects to be entitled to receive in exchange for those goods or services recognized as performance obligations are satisfied. A significant portion of the Group's revenue-generating transactions are not subject to ASC Topic 606, including revenue generated from financial instruments, such as loans and investment securities, insurance revenue, as these activities are subject to other U.S. GAAP guidance discussed elsewhere within these disclosures. Descriptions of the Group's revenue-generating activities that are within the scope of ASC Topic 606, which are presented in the Consolidated Statements of Operations and Statements of Other Comprehensive Income as components of total revenue, net are as follows:\n\n• Commissions on brokerage services;\n\n• Commissions on banking services (money transfers, foreign exchange operations and other);\n\n• Agency fee commissions (the Company earns agency fee commissions through its facilitation of transactions between customers);\n\n• Commissions on payment processing; and\n\n• Commissions on investment banking services (such as underwriting and market making services).\n\nThe Group launched a cashback-based loyalty program, according to which cashback is provided for purchases made with Bank's card, depending on the customer loyalty-level. If cash or another form of consideration provided to a customer, the Group reduces the transaction price.\n\nConcentrations of Revenue\n\nRevenues from one customer of the Group's Brokerage segment represents the following amount of the Group's consolidated revenues:\n\n202620252024\n\nSingle non-related party366,966 317,536 296,257 \n\nFor the fiscal years ended March 31, 2026, March 31, 2025 and March 31, 2024 the amounts in the table above included fee and commission income earned from one customer in the amount of $345,523, $284,728 and $196,663, respectively and interest income from margin loans to customer in the amount of $21,443, $32,808 and $99,594, respectively.\n\nTransaction-Based Revenues\n\n115\n\n[Table of Contents](#i70ff496d74d2478e8fff6b413c2fcd4c_7)\n\nFREEDOM HOLDING CORP.\n\nNOTES TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS MARCH 31, 2026\n\n(All amounts in thousands of United States dollars, except share data, unless otherwise stated)\n\nThe Company earns transaction-based revenue by routing and executing customer orders in equities, options, fixed-income securities and other exchange-traded products. Individual customer trade orders may be executed within our omnibus accounts with third party brokers resulting in simultaneous buy and sell orders on the same security being issued to the third party brokers. The Company's single performance obligation to each customer is satisfied at the point in time each individual order is executed, which is when the customer obtain substantially all of the benefits from the services. The transaction price is established at execution and consists of per-instrument or per-contract commissions and a fixed percentage of the notional trade value.\n\nGross versus net revenue\n\nASC 606 provides guidance on proper recognition of principal versus agent considerations which is used to determine gross versus net revenue recognition. Under ASC 606, the core objective of the guidance on gross versus net revenue recognition is to help determine whether the Group is a principal or an agent in a transaction. In general, the primary difference between these two is the performance obligation being satisfied. The principal has a performance obligation to provide the desired goods or services to the end customer, whereas the agent arranges for the principal to provide the desired goods or services. Additionally, a fundamental characteristic of a principal in a transaction is control. A principal substantively controls the goods and services before they are transferred to the customer as well as controls the price of the good or service being provided. An agent normally receives a commission or fee for these activities. In addition to control, the level at which the Group controls the price of the good or service being transferred determines principal versus agent status. The more discretion over setting price a Group has in providing the good or service, the more likely they are considered a principal rather than an agent.\n\nIn certain cases, other parties are involved with providing products and services to Freedom's customers. If Freedom is principal in the transaction (providing goods or services itself), revenues are reported based on the gross consideration received from the customer and any related expenses are reported gross in non interest expense. If Freedom is an agent in the transaction (arranging for another party to provide goods or services), the Group reports its net fee or commission retained as revenue.\n\nBased on the contractual arrangements with customers, the Company acts as an agent on behalf of its clients by facilitating customers to enter into long and short positions within the Company's omnibus accounts. The Company facilitates the purchase and sale of securities and securities lending transactions through its platforms by routing purchases and sales transactions from its customers, including the market-making customer through its prime brokers. All the customers, including the market-making customer, act on a principal basis and assume the associated market and counterparty risks of their respective positions. The Company does not act as a counterparty to its clients’ buy or sell transactions but may provide them with margin loans and securities lending transactions. The Company's clients have control of the securities they transact on the Company's platforms, including those that collateralize margin loans, and, as a result, such securities are not presented on the Company's Consolidated Balance Sheets.\n\nInterest income\n\nInterest income on margin loans, loans issued, trading securities, available-for-sale securities, held-to-maturity securities, and reverse repurchase agreement obligations are recognized based on the contractual provisions of the underlying arrangements.\n\nLoan premiums and discounts are deferred and generally amortized into interest income as yield adjustments over the contractual life and/or commitment period using the effective interest method.\n\nThe Group suspends accrual of interest income for the loans which meet the impairment criteria. Interest income is not accrued on margin lending receivables in case value of collateral is not sufficient or less than margin loan amount.\n\nUnamortized premiums, discounts and other basis adjustments on trading securities are generally recognized in interest income over the contractual lives of the securities using the effective interest method.\n\n116\n\n[Table of Contents](#i70ff496d74d2478e8fff6b413c2fcd4c_7)\n\nFREEDOM HOLDING CORP.\n\nNOTES TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS MARCH 31, 2026\n\n(All amounts in thousands of United States dollars, except share data, unless otherwise stated)\n\nInterest income from marginal lending includes income accrued on off-balance sheet arrangements, which mainly include repurchase agreements of the Group's brokerage customers.\n\nLoans\n\nThe Group's loan portfolio is divided into: mortgages, corporate loans, loans to small and medium-sized enterprises (“SME”), purchased retail loans, car loans, retail loans and other loans. Mortgage loans consist of loans provided to individuals to purchase residential properties, which is used as collateral for the loan. Margin loans are not classified as part of the Group's loan portfolio and are instead recorded on the Consolidated Balance Sheets under Margin lending, brokerage and other receivables, net. Additionally, most of our mortgage loans, corporate loans, loans to SME, car loans, and retail loans are digital in nature.\n\nA loan becomes delinquent when the borrower doesn't fulfill its obligations to the Group to repay the loan on time according to the agreement.\n\nWrite-off\n\nLoans are written off either partially or in their entirety only when the Group has stopped pursuing the recovery. If the amount to be written off is greater than the accumulated loss allowance, the difference is first treated as an addition to the allowance that is then applied against the gross carrying amount. Any subsequent recoveries are credited to expected credit loss expense.\n\nThe loan or part of the loan can be fully or partially written off in the following cases:\n\n•death of the borrower;\n\n•bankruptcy of the borrower;\n\n•entry into force of a court decision on refusal or partial satisfaction of the Group's claims for debt collection;\n\n•conversion of the pledged property into the ownership of the Group;\n\n•assignment by the Group of its rights of claim to third parties.\n\nModifications\n\nWhere possible, the Group seeks to restructure loans rather than to take possession of collateral. This may involve extending the payment arrangements and the agreement of new loan conditions.\n\nThe Group derecognizes loan when the terms and conditions have been renegotiated to the extent that, substantially, it becomes a new loan, with the difference recognized as a derecognition gain or loss, to the extent that an impairment loss has not already been recorded. When assessing whether or not to derecognize a loan to a customer, amongst others, the Group considers the following factors: change in currency of the loan, change in counterparty and modifications.\n\nAllowance for credit losses\n\nThe Group maintains an allowance for credit losses (ACL) for financial assets measured at amortized cost. The ACL mainly consists of the allowance for loan losses, and the allowance for credit losses for available-for-sale securities. The estimate of expected credit losses under the current expected credit losses (CECL) methodology adopted on April 1, 2023 is based on relevant information about the past events, current conditions, and reasonable and supportable forecasts that affect the collectability of the reported amounts.\n\nAllowance for credit losses - Loans\n\nThe ACL is a valuation account that is deducted from the amortized cost of total loans to present the net amount expected to be collected on the loans.\n\n117\n\n[Table of Contents](#i70ff496d74d2478e8fff6b413c2fcd4c_7)\n\nFREEDOM HOLDING CORP.\n\nNOTES TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS MARCH 31, 2026\n\n(All amounts in thousands of United States dollars, except share data, unless otherwise stated)\n\nUnder CECL, the Group's methodology to establish the allowance for loan losses has two basic components: (1) a collective CECL component for estimated expected credit losses for pools of loans that share common risk characteristics and (2) an individual CECL component for loans that do not share common risk characteristics.\n\nManagement estimates the allowance balance using relevant and available information from internal and external sources, relating to past events, including historical trends in loan delinquencies and charge offs, current conditions, and reasonable and supportable forecasts.\n\nAllowance for credit losses for loans that share common risk characteristics\n\nPooling loans with common risk characteristics for estimating allowance for credit losses is primarily based on the segmentation by product type and the type of collateral provided. The Group estimates current expected credit loss for loans with common risk characteristics using the PD/LGD methodology, which is based on relevant information about historical experience, current conditions, as well as reasonable forecasts that allow estimating the Group's potential losses on the loan portfolio.\n\nIn assessing the Probability of Default (PD) for loans with common risk characteristics, the Group uses average monthly loan balance flowing across delinquency buckets preferably over a period of five years or more. Based on the weighted average maturity of loans with common risk characteristics, using the Markov chain method, the proportion of possible loan agreements with overdue debts over 90 days is determined, based on factual calculations, which are used to determine the PD for a pool of loans. If there are no own statistics, then the calculation of PD is carried out on the basis of statistics of State Credit Bureau JSC on past events for a period of five or more years. The resulting PD indicator is adjusted for qualitative or internal and external environmental factors not considered within the model, but which are relevant in estimating the expected credit losses within the loan portfolio. The macroeconomic indicators impacting the expected risk of loss within the loan portfolios may include the following: GDP, Brent oil price, inflation, base interest rate and exchange rate. These macroeconomic indicators are recalculated once per year, used throughout the year and for all loan types. For defaulted loans, PD of 100% is applied, for non-impaired loans PD for the average life of the pool is recognized at inception.\n\nIn order to estimate the loss given default (LGD) for loans with common risk characteristics, the Company uses collateral valuations for secured loans and historical data on recoveries through cash repayments of defaulted loans for unsecured loans. For secured loans the Company takes into account the latest market value of the collateral on the calculation date. First, liquidity ratios are applied to market values based on the type of collateral, after which the value of the collateral is discounted at the original effective interest rate of the loan agreement for the risk periods corresponding to the types of collateral. The LGD calculation methodology is the same for both non-impaired and defaulted secured loans. For unsecured loans, the Group uses the average monthly share of repayments of defaulted loans over the past 5 years, discounted back at the weighted average effective interest rate. If there are no sufficient own statistics, then the calculation of LGD is carried out on the basis of statistics of State Credit Bureau JSC on past events for a period of five or more years.\n\nThe described above PD/LGD approach apply for all type of loans, as well as non-impaired and defaulted.\n\nAllowance for credit losses for loans that do not share common risk characteristics\n\nLoans that do not share similar risk characteristics with any pools of assets are subject to individual evaluation and are removed from the collectively assessed pools. Loans that are individually evaluated for collectability are reviewed based on an assessment of the financial condition of the borrower, taking into account the most possible debt repayment scenarios: due to expected cash flows from operating activities, cash available from guarantors, founders, shareholders, investors, related companies, other confirmed cash flows, restructuring of the borrower's obligations and the sale of collateral. Depending on the loan maturity date, the expected cash flows are discounted at the original effective interest rate and allowance for credit losses are calculated as the difference between the discounted expected cash flows and outstanding balance of the loan. If repayment of the debt is deemed impossible, based on the expected cash flows, the Group accrues allowance for credit losses in the amount of 100% of the loan balance.\n\nLoan portfolio risk elements and credit risk management\n\n118\n\n[Table of Contents](#i70ff496d74d2478e8fff6b413c2fcd4c_7)\n\nFREEDOM HOLDING CORP.\n\nNOTES TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS MARCH 31, 2026\n\n(All amounts in thousands of United States dollars, except share data, unless otherwise stated)\n\nCredit risk management. When implementing credit risk management processes, the Group is guided by internal policies and procedures, which define the main goals, objectives, principles, priority areas for the formation of an internal effective credit risk management system that corresponds to the current market situation and the Group's development strategy, and ensures effective identification, measurement, monitoring and control of the Group's credit risk. In order to minimize credit risk, the Group has developed procedures for managing internal risk appetite limits for currencies, countries, sectors of the economy, business categories and products, types of collateral, concentration of risk on the top 20 borrowers, debts of a group of related borrowers, etc. Control over the level of limits on credit risk is carried out by the Group's dedicated credit risk team through the preparation of monthly management reports, which include, but are not limited to, information on the quality of the loan portfolio, its classification in accordance with the requirements of reporting standards, on the amount of exposure to credit risk, including a group of related borrowers, on the concentration of credit risk of the largest borrowers and borrowers as related parties to the Group, on the internal rating of borrowers, etc. When analyzing a borrower, the Group uses the following information to assess creditworthiness: the borrower's existing loans, the presence of overdue debt, income, age, work experience and dynamics of credit behavior.\n\nMortgage loans. The Group provides mortgage loans for the purchase of real estate in both the primary and secondary markets. This is done through the Group's own and government lending programs, relevant lending products as described in the Group's internal normative documents. The main share of the Group's loan portfolio is represented by mortgage loans issued within the framework of state support programs, funded from the funds of quasi-state organizations. Valuation of real estate collateral is carried out directly by independent appraisal companies with subsequent confirmation by the Group's collateral service. The collateral policy and methodology of the process for working with collateral comply with the regulatory requirements of the regulator and the banking legislation of the country. In the process of making decisions on the solvency and creditworthiness of borrowers, an automatic check is carried out through external and internal databases. To do this, the results of both the Group's own and third-party credit scoring models are taken into account. The Group does not use third party loan underwriting services. Residential mortgages include only fixed rate loans secured by real estate purchases. When making a decision to issue a mortgage on housing, the Group takes into account the qualifications of the borrower, as well as the value of the underlying property.\n\nCar loans. When making decisions on car loans, the Group uses both evaluation and scoring systems. The Group provides loans for the purchase of motor vehicles both under the C2C scheme and under the B2C scheme with the participation of car dealerships. The decision-making process includes the use of data from credit bureaus, government databases and other sources of information. This allows not only to assess the financial capacity of a potential borrower, but also to evaluate the purchased vehicle. Machine learning models have also been introduced that analyze data about the cars themselves and sellers. This allows to automatically screen out applications with high potential credit risk.\n\nCorporate loans. Corporate loans consist of loans provided to corporate borrowers primarily for working capital, investment, capital expenditure and other business financing purposes. Corporate loans may be structured as term loans, credit lines or other commercial lending products and may be secured or unsecured depending on the borrower’s credit profile, repayment capacity and approved credit terms. The Group evaluates corporate borrowers based on their financial condition, cash flows, business activity, repayment capacity, credit history, industry risk, collateral coverage, guarantees, compliance with contractual covenants and other relevant credit risk indicators. Corporate loans are monitored through periodic credit reviews, analysis of repayment performance, updated borrower financial information, collateral monitoring and other information indicating changes in credit risk. Corporate loans are generally secured by real estate, cash deposits, securities, guarantees or other collateral.\n\nPurchased retail loans. Purchased retail loans consist of unsecured consumer loans and related rights of claim to individuals that were originated by third-party or related-party financial institutions and subsequently acquired by the Group through assignment, cession or similar purchase arrangements. Purchased retail loans include loans historically acquired from Microfinance Organization Freedom Finance Credit LLP and recognized within loans issued following the termination or release of the related cession and credit-protection arrangements, as well as other retail loans that may be acquired by the Group. Purchased retail loans are recognized when the Group obtains the contractual rights to receive cash flows from the underlying borrowers and assumes the related credit risk. Purchased retail loans are recorded within loans issued and are subsequently accounted for in accordance with the Group’s policies applicable to loans measured at amortized cost. Any purchase discount, premium or other purchase-related adjustment is considered in determining the carrying amount of the purchased loan and is recognized over the expected life of the loan, as applicable. The Group\n\n119\n\n[Table of Contents](#i70ff496d74d2478e8fff6b413c2fcd4c_7)\n\nFREEDOM HOLDING CORP.\n\nNOTES TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS MARCH 31, 2026\n\n(All amounts in thousands of United States dollars, except share data, unless otherwise stated)\n\nevaluates purchased retail loans based on the credit characteristics of the underlying borrowers, payment history, delinquency status, expected recoveries, historical loss experience and other relevant credit risk indicators. Purchased retail loans are monitored for delinquency, write-off and expected credit losses in accordance with the Group’s credit risk management and allowance for credit loss policies applicable to its loan portfolio.\n\nLoans to SME. The Group provides loans to small and medium-sized enterprises and individual entrepreneurs for working capital, business development and other commercial purposes. Loans to SME may be issued under the Group’s own lending programs or, where applicable, under government or quasi-governmental programs, including programs with subsidized interest rates or partial credit support. Loans to SME may be unsecured or secured, depending on the borrower’s credit profile, product terms and approved credit structure. Collateral, where obtained, may include guarantees, cash deposits, highly liquid financial assets or other collateral acceptable under the Group’s credit policies. Collateral requirements and loan limits are established at origination and monitored in accordance with the Group’s credit risk management procedures. Loans to SME are recorded within loans issued and are subsequently measured at amortized cost, net of allowance for credit losses.\n\nRetail loans. Retail loans consist of loans issued to individuals for consumer and other personal purposes, excluding mortgage loans, car loans and purchased retail loans, which are presented separately. Retail loans include unsecured consumer loans, credit card-related exposures and other retail banking loans originated by the Group. Certain retail loans may also be secured by cash deposits, highly liquid financial assets, guarantees or other eligible collateral, depending on the product type and approved credit terms. The Group makes retail lending decisions based on internal scoring models, credit bureau data, customer income, repayment history, behavioral data, information from official sources and other relevant credit risk indicators. The Group also considers applicable regulatory requirements, including limits on the borrower’s debt service burden. If the borrower does not satisfy the Group’s credit criteria or applicable regulatory requirements, the loan application is rejected. Retail loans are issued under the Group’s own lending programs and, where applicable, under government or subsidized lending programs. Retail loans are recorded within loans issued and are subsequently measured at amortized cost, net of allowance for credit losses.\n\nDerivative financial instruments\n\nThe Group enters into derivatives, such as foreign currency swaps, to diversify its funding sources and manage foreign currency risk; the Group does not use derivatives for trading purposes, to generate income or to engage in speculative activity. The Group enters into derivatives that not designated in hedging relationships under ASC 815, the fair value adjustments are recorded in gain (loss) on derivative instruments and trading securities, net. Derivatives in a gain position are reported as derivative assets at fair value and derivatives in a loss position are reported as derivative liabilities at fair value in our consolidated balance sheets. In our consolidated statements of cash flows, cash receipts and payments related to derivative instruments are classified according to the underlying nature or purpose of the derivative transaction, generally in the investing section for derivatives not designated in hedging relationships.\n\nFunctional currency\n\nManagement has adopted ASC 830, Foreign Currency Translation Matters as it pertains to its foreign currency translation. The Company's functional currencies are the Kazakhstan tenge, the euro, the U.S. dollar, the Uzbekistani sum, the Kyrgyzstani som, the Azerbaijani manat, the British pound sterling, the Armenian dram, the United Arab Emirates dirham and the Turkish lira, and its reporting currency is the U.S. dollar. For financial reporting purposes, foreign currencies are translated into U.S. dollars as the reporting currency. Monetary assets and liabilities denominated in foreign currencies are translated into U.S. dollars using the exchange rate prevailing at the balance sheet date. Non-monetary assets and liabilities denominated in foreign currencies are translated at rates of exchange in effect at the date of the transaction. Average quarterly rates are used to translate revenues and expenses. Translation adjustments arising from the use of different exchange rates from period to period are included as a component of shareholders' equity as \"Accumulated other comprehensive loss\". The Group uses exchange rates from the NBK for foreign currency translation purposes.\n\nCash and cash equivalents\n\nCash and cash equivalents are generally comprised of cash and certain highly liquid investments with original maturities of three months or less at the date of purchase. Cash and cash equivalents include reverse repurchase agreements with a\n\n120\n\n[Table of Contents](#i70ff496d74d2478e8fff6b413c2fcd4c_7)\n\nFREEDOM HOLDING CORP.\n\nNOTES TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS MARCH 31, 2026\n\n(All amounts in thousands of United States dollars, except share data, unless otherwise stated)\n\nmaturity of less than 90 days and where the credit risk of the counterparty is low, which are recorded at the amounts at which the securities were acquired plus accrued interest.    \n\nSecurities reverse repurchase and repurchase agreements\n\nA reverse repurchase agreement is a transaction in which the Group purchases financial instruments from a seller, typically in exchange for cash, and simultaneously enters into an agreement to resell the same or substantially the same financial instruments to the seller for an amount equal to the cash or other consideration exchanged plus interest at a future date. Securities purchased under reverse repurchase agreements are accounted for as collateralized financing transactions and are recorded at the contractual amount for which the securities will be resold, including accrued interest. Financial instruments purchased under reverse repurchase agreements are recorded in the financial statements as cash placed on deposit collateralized by securities and classified as cash and cash equivalents in the Consolidated Balance Sheets.\n\nA repurchase agreement is a transaction in which the Group sells financial instruments to another party, typically in exchange for cash, and simultaneously enters into an agreement to reacquire the same or substantially the same financial instruments from the buyer for an amount equal to the cash or other consideration exchanged plus interest at a future date. These agreements are accounted for as collateralized financing transactions. The Group retains the financial instruments sold under repurchase agreements and classifies them as trading securities in the Consolidated Balance Sheets. The consideration received under repurchase agreements is classified as securities repurchase agreement obligations in the Consolidated Balance Sheets.\n\nThe Group enters into reverse repurchase agreements, repurchase agreements, securities borrowed and securities loaned transactions to, among other things, acquire securities to leverage and grow its proprietary trading portfolio, cover short positions and settle other securities obligations, to accommodate customers' needs and to finance its asset positions. The Group enters into these transactions in accordance with normal market practice. Under standard terms for repurchase transactions, the recipient of collateral has the right to sell or repledge the collateral, subject to returning equivalent securities on settlement of the transaction.\n\nRestricted cash\n\nRestricted cash consists of cash and cash equivalents that are held for specific reasons and not available for immediate use. Certain subsidiaries of the Group are obligated by rules and regulations mandated by their primary regulators to segregate or set aside certain customer cash in the interests of protecting customer assets. Restricted cash is mainly represented by customer cash and guaranty deposits, which are restricted in use by the Group for more than three months.\n\nAvailable-for-sale securities\n\nFinancial assets categorized as available-for-sale (\"AFS\") are non-derivatives that are either designated as available-for-sale or not classified as (a) loans and receivables, (b) held-to-maturity investments or (c) trading securities.\n\nGains and losses arising from changes in fair value are recognized in other comprehensive income and accumulated in the Accumulated other comprehensive loss, with the exception of other-than-temporary impairment losses, interest calculated using the effective interest method, and foreign exchange gains and losses are recognized in the Consolidated Statements of Operations and Statements of Other Comprehensive Income. When the investment is disposed of or is determined to be impaired, the cumulative gain or loss previously accumulated in the accumulated other comprehensive (loss)/income is then reclassified to net realized gain/(loss) on investments available-for-sale in the Consolidated Statements of Operations and Statements of Other Comprehensive Income.\n\nTrading securities\n\nFinancial assets are classified as trading securities if the financial asset has been acquired principally for the purpose of selling it in the near term.\n\nTrading securities are stated at fair value, with any gains or losses arising on remeasurement recognized in revenue. Changes in fair value are recognized in the Consolidated Statements of Operations and Statements of Other Comprehensive Income and included in net gain on trading securities. Interest earned and dividend income are recognized in the\n\n121\n\n[Table of Contents](#i70ff496d74d2478e8fff6b413c2fcd4c_7)\n\nFREEDOM HOLDING CORP.\n\nNOTES TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS MARCH 31, 2026\n\n(All amounts in thousands of United States dollars, except share data, unless otherwise stated)\n\nConsolidated Statements of Operations and Statements of Other Comprehensive Income and included in interest income and other income, respectively, according to the terms of the contract and when the right to receive the payment has been established.\n\nInvestments in nonconsolidated managed funds are accounted for at fair value based on the net asset value of the funds provided by the fund managers with gains or losses included in net gain on trading securities in the Consolidated Statements of Operations and Statements of Other Comprehensive Income.\n\nHeld-to-maturity securities\n\nFinancial assets are classified as held-to-maturity (\"HTM\") when the Group has the positive intent and ability to hold the securities to maturity. HTM securities are non-derivative debt instruments that are measured at amortized cost using the effective interest method, less any allowance for expected credit losses.\n\nInterest income on HTM securities is recognized in the Consolidated Statements of Operations and Statements of Other Comprehensive Income using the effective interest method. Changes in fair value are not recognized in the consolidated financial statements as long as the investment continues to meet the criteria for held-to-maturity classification. However, the fair value of HTM securities is disclosed in the notes to the consolidated financial statements.\n\nManagement estimates expected credit losses at each reporting date and records any increase or decrease in the allowance through \"Allowance for expected credit losses\" in the Consolidated Statements of Operations and Statements of Other Comprehensive Income. The security's amortized cost basis is not written down unless the security is either sold or determined to be uncollectible. Because HTM securities are not remeasured to fair value, unrealized changes in fair value that are unrelated to credit risk are not recognized in either net income or other comprehensive income.\n\nDebt securities issued\n\nDebt securities issued are initially recognized at the fair value of the consideration received, less directly attributable transaction costs. Subsequently, amounts due are stated at amortized cost and any difference between net proceeds and the redemption value is recognized over the period of the borrowings using the effective interest method. If the Group purchases its own debt it is removed from the Consolidated Balance Sheets and the difference between the carrying amount of the liability and the consideration paid is recognized in the Consolidated Statements of Operations and Statements of Other Comprehensive Income.\n\nContingencies\n\nThe Group records loss contingencies if (a) information available prior to issuance of the consolidated financial statements indicates that it is probable that an asset had been impaired or a liability had been incurred at the date of the consolidated financial statements, and (b) the amount of loss can be reasonably estimated. If one or both criteria for accrual are not met, but there is at least a reasonable possibility that a loss will occur, the Group does not record an accrual for a loss contingency but describes the contingency and provides detail, when possible, of the estimated potential loss or range of loss. If an estimate cannot be made, a statement to that effect is made. Costs incurred with defending matters are expensed as incurred.\n\nMargin lending, brokerage and other receivables\n\nThe Group engages in securities financing transactions with and for customers through margin lending. In margin lending, the Group's customers borrow funds from the Group or sell securities the customer does not own against the value of their qualifying securities held in custody by the Group. Under these agreements, the Group is permitted to sell or repledge securities received as collateral. Furthermore, the contractual arrangements establish that the Group can use the pledged collateral by the customers for repurchase agreement operations, securities lending transactions or delivery to other counterparties to cover short positions.\n\nMargin lending, brokerage and other receivables comprise margin lending receivables, receivables from telecommunication services, brokerage commissions and other receivables related to the securities brokerage, banking and telecommunication\n\n122\n\n[Table of Contents](#i70ff496d74d2478e8fff6b413c2fcd4c_7)\n\nFREEDOM HOLDING CORP.\n\nNOTES TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS MARCH 31, 2026\n\n(All amounts in thousands of United States dollars, except share data, unless otherwise stated)\n\nactivity of the Group. At initial recognition, margin lending, brokerage and other receivables are recognized at fair value. Subsequently, margin lending, brokerage and other receivables are carried at cost net of any allowance for credit losses.\n\nFor both individual and institutional brokerage customers, the Group may enter into arrangements for securities financing transactions in respect of financial instruments held by the Group on behalf of the customer or may use such financial instruments for its own account or the account of another customer. The Group maintains omnibus brokerage accounts for certain institutional brokerage customers, in which transactions of the underlying customers of such institutional customers are combined in a single omnibus account with our third party broker. As noted above, the Group may use the assets within the omnibus accounts to finance, lend, provide credit or provide debt financing or otherwise use and direct the order or manner of assets for financing of other customers of ours.\n\nCustomers' required margin levels and established credit limits are monitored continuously by the Group's risk management staff. Pursuant to the Group's policy, customers are required to deposit additional collateral or reduce positions, when necessary, to avoid liquidation of their positions.\n\nDerecognition of financial assets\n\nA financial asset (or, where applicable a part of a financial asset or a part of a group of similar financial assets) is derecognized where all of the following conditions are met:\n\n•The transferred financial assets have been isolated from the Group - put presumptively beyond the reach of the Group and its creditors, even in bankruptcy or other receivership.\n\n•The transferee has rights to pledge or exchange financial assets.\n\n•The Group or its agents do not maintain effective control over the transferred financial assets or third-party beneficial interests related to those transferred assets.\n\nWhere the Group has not met the asset derecognition conditions above, it continues to recognize the asset to the extent of its continuing involvement.\n\nImpairment of long-lived assets\n\nIn accordance with the accounting guidance for the impairment or disposal of long-lived assets, the Group periodically evaluates the carrying value of long-lived assets to be held and used when events and circumstances warrant such a review. The carrying value of a long-lived asset is considered impaired when the fair value from such asset is less than its carrying value. In that event, a loss is recognized based on the amount by which the carrying value exceeds the fair value of the long-lived asset. Fair value is determined primarily using the anticipated cash flows discounted at a rate commensurate with the risk involved. Losses on long-lived assets to be disposed of are determined in a similar manner, except that fair values are reduced for the cost of disposal. During the fiscal year ended March 31, 2026 and 2025 the Group did not record any charges for impairment of long-lived assets.\n\nImpairment of goodwill\n\nGoodwill is allocated to reporting units, which are identified as the operating segments or one level below operating segments that generate separate financial information regularly reviewed by management. The assignment of goodwill to reporting units allows for the assessment of potential impairment at the appropriate level within the organization.\n\nThe Group has identified its reporting units based on its organizational and operational structure, as well as the level at which internal financial information is reviewed by management to make strategic decisions. We have the following reporting units: Banking, Insurance, Brokerage and Other. A detailed description of these reporting units is provided in \"Products and Services\" in Item 1. Business.\n\nGoodwill has been allocated to each reporting unit based on its relative fair value at the time of acquisition or significant triggering events. The fair value allocation of goodwill to reporting units is periodically reassessed to ensure alignment with the Group's evolving organizational structure and operational dynamics.\n\n123\n\n[Table of Contents](#i70ff496d74d2478e8fff6b413c2fcd4c_7)\n\nFREEDOM HOLDING CORP.\n\nNOTES TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS MARCH 31, 2026\n\n(All amounts in thousands of United States dollars, except share data, unless otherwise stated)\n\nThe Group conducts impairment testing on an annual basis or whenever indicators of potential impairment arise. The impairment testing involves comparing the carrying amount of each reporting unit, including its allocated goodwill, to its fair value. If the carrying amount exceeds the fair value, an impairment loss is recognized.\n\nFurther details regarding the measurement of goodwill impairment and the results of impairment tests for each reporting unit are provided below.\n\nThe Group discloses information about the reporting units, the carrying amounts of goodwill allocated to each reporting unit, and the impairment losses recognized. The allocation of goodwill to reporting units ensures a focused evaluation of each unit's financial performance and facilitates the identification of potential impairment, enhancing the transparency and reliability of the Company's financial reporting.\n\nAs of March 31, 2026 and 2025, goodwill recorded in the Group's Consolidated Balance Sheets totaled $51,099 and $49,093 respectively. The Group performs an impairment review at least annually unless indicators of impairment exist in interim periods. The entity compares the fair value of a reporting unit with its carrying amount. The goodwill impairment charge is recognized for the amount by which the reporting unit's carrying amount exceeds its fair value, limited to the total amount of goodwill allocated to that reporting unit. If fair value exceeds the carrying amount, no impairment is recorded.\n\nThe goodwill value at March 31, 2026 increased compared to March 31, 2025, primarily as a result of the acquisition of 100% interest in Freedom Cloud Holding (formerly, Astel Group Ltd., renamed on January 8, 2026) by Freedom Telecom and the effect of foreign currency translation. Excluding the impact of acquisition of Freedom Cloud Holding, goodwill decreased due the sale of Comrun LLP.\n\nThe changes in the carrying amount of goodwill for the years ended March 31, 2026 and March 31, 2025, were as follows:\n\nBrokerage\nBank\nInsuranceOtherTotal\n\nGoodwill, gross\n\nBalance as of March 31, 2024\n$2,688 $2,746 $1,040 $46,174 $52,648 \n\nForeign currency translation difference(120)(11)(119)(4,245)(4,495)\n\nAcquired— — — 940 940 \n\nBalance as of March 31, 2025\n2,568 $2,735 $921 $42,869 $49,093 \n\nForeign currency translation difference50 (280)49 1,737 1,556 \n\nWrite-off due to the sale— — — (560)(560)\n\nAcquired— — — 1,010 1,010 \n\nBalance as of March 31, 2026\n2,618 $2,455 $970 $45,056 $51,099 \n\nAccumulated impairment\n\nBalance as of March 31, 2024\n$— $— $— $— $— \n\nImpairment expense— — — — — \n\nBalance as of March 31, 2025\n$— $— $— $— $— \n\nImpairment expense— — — — — \n\nBalance as of March 31, 2026\n$— $— $— $— $— \n\nGoodwill, net of impairment\n\nBalance as of March 31, 2024\n$2,688 $2,746 $1,040 $46,174 $52,648 \n\nBalance as of March 31, 2025\n$2,568 $2,735 $921 $42,869 $49,093 \n\nBalance as of March 31, 2026\n$2,618 $2,455 $970 $45,056 $51,099 \n\n124\n\n[Table of Contents](#i70ff496d74d2478e8fff6b413c2fcd4c_7)\n\nFREEDOM HOLDING CORP.\n\nNOTES TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS MARCH 31, 2026\n\n(All amounts in thousands of United States dollars, except share data, unless otherwise stated)\n\nBusiness combinations and acquisitions\n\nAcquisitions of businesses not under common control are accounted for using the acquisition method. The consideration transferred in a business combination is measured at fair value, which is calculated as the sum of the acquisition-date fair values of the assets transferred by the Group, liabilities incurred by the Group to the former owners of the acquiree and the equity interests issued by the Group in exchange for control of the acquiree. Acquisition-related costs are generally recognized in profit or loss as incurred. The assets and liabilities acquired are recognized, with certain exceptions such as deferred taxes, at their fair values at the acquisition date.\n\nBusiness combinations under common control are accounted for under the pooling of interests method which involves combining the financial statements of the acquiring and acquired entities as if they had been combined from the beginning of the common control relationship. The assets and liabilities are combined on a carry over basis and not restated to its fair values. This approach required the Group to recast its consolidated financial statements to reflect the assets, liabilities and operations of the acquired entities since the beginning of the earliest comparative period.\n\nIncome taxes\n\nThe Group recognizes deferred tax liabilities and assets based on the difference between the financial statements and tax basis of assets and liabilities using the enacted tax rates in effect for the year in which the differences are expected to reverse. The measurement of deferred tax assets is reduced, if necessary, by the amount of any tax benefits that, based on available evidence, are not expected to be realized.\n\nCurrent income tax expenses are provided for in accordance with the laws of the relevant taxing authorities. As part of the process of preparing financial statements, the Group is required to estimate its income taxes in each of the jurisdictions in which it operates. The Group accounts for income taxes using the asset and liability approach. Under this method, deferred income taxes are recognized for tax consequences in future years based on differences between the tax bases of assets and liabilities and their reported amounts in the financial statements at each year-end and tax loss carry forwards. Deferred tax assets and liabilities are measured using enacted tax rates applicable for the differences that are expected to affect taxable income.\n\nThe Group records uncertain tax positions in accordance with ASC 740 on the basis of a two-step process in which (1) the Group determines whether it is more likely than not that the tax positions will be sustained on the basis of the technical merits of the position and (2) for those tax positions that meet the more-likely-than-not recognition threshold, the Group recognizes the largest amount of tax benefit that is more than 50 percent likely to be realized upon ultimate settlement with the related tax authority.\n\nThe Group will include interest and fines arising from the underpayment of income taxes in the provision for income taxes (if anticipated). As of March 31, 2026 and 2025, the Group had no accrued interest or fines related to uncertain tax positions.\n\nThe Global Intangible Low-Taxed Income (\"GILTI\") provisions of the Tax Cuts and Jobs Act require the Group to include in its U.S. income tax return foreign subsidiary earnings in excess of an allowable return on the foreign subsidiary's tangible assets. The Group has presented the deferred tax impacts of GILTI tax in its consolidated financial statements as of March 31, 2026 and 2025.\n\nPillar 2\n\nIn October 2021, the Inclusive Framework, established by members of the OECD and the G20 countries, reached an agreement on a Two-Pillar Solution to address the tax challenges arising from the digitalisation of the economy (Pillar 1 and Pillar 2). The Inclusive Framework brings together over 140 countries and jurisdictions, including Kazakhstan.\n\nPillar 2 specifically targets MNEs with annual consolidated revenue of 750 million EUR or more (“MNE groups”) (for any two years within the last 4 reporting years), aiming to ensure a minimum global effective tax rate (ETR) of 15%.\n\nThe Pillar Two rules generally impose a 15% minimum effective tax rate, determined on a jurisdictional basis, through an income inclusion rule (“IIR”), an undertaxed profits rule (“UTPR”), and/or a qualified domestic minimum top-up tax (“QDMTT”), depending on the legislation enacted in each relevant jurisdiction. As of March 31, 2026, Pillar Two legislation has been enacted in certain jurisdictions in which the Group operates, including Germany, the United Kingdom,\n\n125\n\n[Table of Contents](#i70ff496d74d2478e8fff6b413c2fcd4c_7)\n\nFREEDOM HOLDING CORP.\n\nNOTES TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS MARCH 31, 2026\n\n(All amounts in thousands of United States dollars, except share data, unless otherwise stated)\n\nTürkiye, Cyprus and the United Arab Emirates. The United Arab Emirates has implemented a domestic minimum top-up tax but has not implemented an IIR.\n\nThe OECD has issued transitional safe harbour rules intended to reduce initial compliance burdens for in-scope groups. Under the updated OECD guidance issued in January 2026, the transitional country-by-country reporting safe harbour is available for fiscal years beginning on or before December 31, 2027, but not for fiscal years ending after June 30, 2029, subject to meeting the applicable requirements. Based on the Group’s assessment of the fiscal year ended March 31, 2026, the Group expects that certain jurisdictions may qualify for one or more of the transitional safe harbour tests. However, Kazakhstan and Cyprus did not qualify for the transitional safe harbour based on the Group’s preliminary assessment.\n\nOn January 5, 2026, the OECD released the Side-by-Side package, which includes a Side-by-Side Safe Harbour for multinational enterprise groups whose ultimate parent entity is located in a jurisdiction with a Qualified Side-by-Side Regime. The OECD Central Record lists the United States as a jurisdiction with a Qualified Side-by-Side Regime for fiscal years commencing on or after January 1, 2026. Because the Group’s Ultimate Parent Entity is located in the United States, which is listed by the OECD as a jurisdiction with an Eligible Side-by-Side Regime, the Group is eligible to elect the Side-by-Side Safe Harbour for fiscal years commencing on or after January 1, 2026. Accordingly, the Group expects to apply this safe harbour beginning with its fiscal year commencing April 1, 2026, subject to the applicable election and reporting requirements. Where validly elected, the Side-by-Side Safe Harbour generally deems top-up tax to be zero for purposes of the IIR and UTPR. The safe harbour does not apply to QDMTTs and does not affect fiscal years commencing before January 1, 2026.\n\nIn this regard, Side-by-Side Safe Harbour does not apply to QDMTTs and does not affect the Group’s fiscal year ended March 31, 2026. The Group will continue to evaluate the impact of Pillar Two for future periods, including any exposure under QDMTT rules and applicable filing and reporting obligations.\n\nTransitional Safe Harbor Rules\n\nTo reduce initial compliance burdens, the OECD introduced Transitional Safe Harbor Rules (Annex A to the Administrative Guidance, Dec 2022), applicable for fiscal years beginning on or before December 31, 2026 (but not after June 30, 2028). A jurisdictional safe harbor is met if one of the following tests is satisfied:\n\n•De Minimis Test – Jurisdictional revenue < EUR 10 million and Profit (Loss) Before Tax < EUR 1 million\n\n•Simplified ETR Test – Simplified covered taxes ÷ PBT > 15%\n\n•Routine Profits Test – PBT ≤ routine profits based on the Substance-Based Income Exclusion (SBIE) formula\n\nBased on FY 2026 results, assessments indicate that all jurisdictions except Kazakhstan and Cyprus qualify for at least one of the safe harbor tests.\n\nSide-by-Side Administrative Guidance\n\nOn January 5, 2026, the OECD released the Side-by-Side package, which provides relief from the Pillar Two IIR and UTPR for multinational groups whose ultimate parent entity is located in a jurisdiction with a Qualified Side-by-Side regime, for fiscal years beginning on or after January 1, 2026. OECD materials issued in January 2026 indicate that the United States is treated as an Eligible Side-by-Side regime jurisdiction. Given that Group’s ultimate parent entity is located in the United States, the Group may access this relief for those fiscal years i.e. top-up tax should not arise under the IIR or UTPR for the constituent entities for fiscal years covered by the election. This relief does not apply to QDMTTs and does not affect fiscal years beginning before January 1, 2026.\n\nConsistent with this, although Kazakhstan had not yet enacted Pillar Two legislation and Uzbekistan, Azerbaijan and Armenia had not yet made a public enactment announcement, low-taxed entities in those jurisdictions should not create IIR or UTPR exposure for the Group in other jurisdictions for fiscal years in which the Group qualifies for and elects the Side-by-Side Safe Harbour. Accordingly, low-taxed income in Kazakhstan should not be reallocated under UTPR to jurisdictions such as Cyprus, Germany, the United Kingdom or Türkiye for those fiscal years. Any potential exposure to QDMTTs would remain unaffected.\n\n126\n\n[Table of Contents](#i70ff496d74d2478e8fff6b413c2fcd4c_7)\n\nFREEDOM HOLDING CORP.\n\nNOTES TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS MARCH 31, 2026\n\n(All amounts in thousands of United States dollars, except share data, unless otherwise stated)\n\nFair Value\n\nFair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair value measurement is based on the presumption that the transaction to sell the asset or transfer the liability takes place either in the principal market for the asset or liability, or in the absence of a principal market, in the most advantageous market for the asset or liability. Fair value is the current bid price for financial assets, current ask price for financial liabilities and the average of current bid and ask prices when the Group is both in short and long positions for the financial instrument. A financial instrument is regarded as quoted in an active market if quoted prices are readily and regularly available from an exchange or other institution and those prices represent actual and regularly occurring market transactions on an arm's length basis.\n\nLeases\n\nThe Group follows ASU No. 2016-02, \"Leases (Topic 842),\" upon adoption of ASC 842, the Group elected not to recognize leases with terms of one-year or less on the balance sheet.\n\nOperating lease assets and corresponding lease liabilities were recognized on the Company's Consolidated Balance Sheets. Refer to Note 27 \"Leases\", to the consolidated financial statements for additional disclosure and significant accounting policies affecting leases.\n\nFixed assets\n\nFixed assets are carried at cost, net of accumulated depreciation. Maintenance, repairs, and minor renewals are expensed as incurred. Depreciation is computed using the straight-line method over the estimated useful lives of the assets, which range between three and sixty-five years.\n\nInsurance contract assets and liabilities\n\nThe Group's insurance operations, conducted through Freedom Finance Life JSC (\"Freedom Life\") and Freedom Finance Insurance JSC (\"Freedom Insurance\"), write both long-duration and short-duration insurance contracts as defined in ASC 944. Effective for annual periods beginning April 1, 2025, the Group adopted ASU 2018-12 (LDTI) using the modified retrospective transition method with a transition date of April 1, 2023, which affected the measurement and presentation of long-duration contracts.\n\nInsurance and reinsurance receivable\n\nInsurance receivable is recognized when the contract comes into force and measured on initial recognition at the fair value of the consideration receivable. Reinsurance receivable is recognized when a gross payment is accrued for which there is reinsurance coverage. Subsequent to initial recognition, any insurance and reinsurance receivable is measured at cost net of any allowance for impairment losses.\n\nDeferred acquisition costs\n\nDeferred acquisition costs (DAC) are commissions, premium taxes, and other incremental direct costs of contract acquisition that results directly from and are essential to the contract transaction(s) and would not have been incurred by the Group had the contract transaction(s) not occurred. The deferred amounts are recorded as an asset within Insurance contract assets on the balance sheet and amortized to expense in a systematic manner.\n\nFor long-duration contracts, effective with the adoption of LDTI, DAC is amortized on a constant-level basis over the expected contract term, grouped by issue-year cohort, in accordance with ASC 944-30-35-3A as amended by LDTI. DAC on long-duration contracts is not subject to impairment testing or loss-recognition assessment under LDTI. For short-duration contracts DAC continues to be amortized over the effective period of the related insurance policies.\n\nDAC amortization for both long-duration and short-duration contracts is recognized within Fee and commission expense.\n\nInsurance and reinsurance payable\n\n127\n\n[Table of Contents](#i70ff496d74d2478e8fff6b413c2fcd4c_7)\n\nFREEDOM HOLDING CORP.\n\nNOTES TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS MARCH 31, 2026\n\n(All amounts in thousands of United States dollars, except share data, unless otherwise stated)\n\nPayables on insurance business comprise advances received, amounts payable to insured (claims and premium refund payable) and amounts payable to agents and brokers, and advances received from insurers and reinsurers.\n\nPayables on reinsurance business comprise net amounts payable to reinsurers. Amounts payable to reinsurers include ceded reinsurance premiums, assumed premium refunds and claims on assumed reinsurance. Insurance and reinsurance payable are accounted for at amortized cost.\n\nThe Group enters into reinsurance arrangements in the ordinary course of its insurance operations; however, reinsurance activity was not significant to the Group’s consolidated financial statements for the periods presented. Reinsurance does not relieve the Group of its primary obligation to policyholders. Amounts recoverable from reinsurers are recognized as reinsurance receivables or reinsurance assets, as applicable, and are evaluated for collectability.\n\nCeded reinsurance does not relieve the Group of its primary obligation to policyholders, and the Group remains liable to policyholders to the extent that any reinsurer fails to meet its obligations under the related reinsurance agreements. As of March 31, 2026 the Group did not have a significant concentration of credit risk with any individual reinsurer or group of reinsurers related to reinsurance recoverables, prepaid reinsurance premiums or reinsurers’ share of insurance reserves.\n\nUnearned premium reserve and claims\n\nUnearned premium is determined by the method of proportion for each contract, as the product of the insurance premium under the contract for the ratio of the expiration of the insurance cover (in days) to the balance sheet date (in days) from the date when contract come into force until the end of the insurance coverage. The reinsurer's share in the unearned premium reserve is calculated separately for each insurance (reinsurance) contract and is determined as the ratio of the insurance premium under the reinsurance contract to the insurance premium under the insurance contract multiplied by the unearned premium reserve.\n\nResults of insurance activity includes net written insurance premiums reduced by the net change in the unearned premium reserve, commissions recognized from assumed insurance and reinsurance contracts, claims paid net and net change in the loss reserves.\n\nNet written insurance premiums represent gross written premiums less premiums ceded to reinsurers. Upon inception of a contract (except for classes of life and annuity insurance), premiums are recorded as written and are earned on a pro rata basis over the term of the related contract coverage. The unearned premium reserve represents the portion of the premiums written relating to the unexpired terms of coverage and is included in the accompanying statement of Consolidated Balance Sheets.\n\nUnearned premium reserve relates to non-life insurance products and non-annuity insurance products.\n\nClaims and other insurance expenses are expensed to the Consolidated Statements of Operations and Statements of Other Comprehensive Income as incurred.\n\nInsurance loss reserves\n\nNon-life and general insurance\n\nLoss reserves are a summary of estimates of ultimate losses, and include both claims reported but not settled (RBNS) and claims incurred but not reported (IBNR). RBNS is created for existing reported claims not settled at the reporting date. Estimates are made on the basis of information received by the Group during its investigation of insured events. IBNR is estimated by the Group based on its previous history of reported/settled claims using actuarial methods of calculation, which include claim development triangles.\n\nReinsurance assets in IBNR are estimated applying the same actuarial method used in IBNR estimation.\n\nThe Group evaluates whether a premium deficiency exists for its short-duration contracts by comparing expected future claims and maintenance costs to expected future premiums under existing contracts. If anticipated losses exceed future premiums, a premium deficiency loss is recognized immediately within Insurance claims and policyholder benefits, net of reinsurance.\n\nFor short-duration contracts written by FF Insurance, the Group considers anticipated investment income in performing premium deficiency testing. Anticipated investment income is based on expected yields on the invested assets supporting\n\n128\n\n[Table of Contents](#i70ff496d74d2478e8fff6b413c2fcd4c_7)\n\nFREEDOM HOLDING CORP.\n\nNOTES TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS MARCH 31, 2026\n\n(All amounts in thousands of United States dollars, except share data, unless otherwise stated)\n\nthe related insurance liabilities over the expected claim payment and maintenance cost period. For short-duration and long-duration contracts written by FF Life, the Group does not consider anticipated investment income in performing premium deficiency testing. If anticipated losses exceed future premiums, after considering anticipated investment income where applicable, a premium deficiency loss is recognized immediately within Insurance claims and policyholder benefits, net of reinsurance. Management assessed the effect of the differing methodologies and concluded that the impact is not material to the consolidated financial statements.\n\nLiability for future policy benefits — long-duration contracts\n\nThe Group establishes a liability for future policy benefits (LFPB) for its long-duration life insurance and annuity contracts. The LFPB is measured as the present value of expected future policy benefits and related policy maintenance expenses less the present value of expected future net premiums, using the net premium ratio approach prescribed by ASC 944-40 as amended by LDTI. The LFPB is included within Insurance contract liabilities on the consolidated balance sheet.\n\nCash flow assumptions\n\nThe significant cash flow assumptions used to measure the LFPB are mortality, lapse rates, and policy maintenance expenses. Mortality assumptions are based on local mortality tables established by the regulatory framework of the Republic of Kazakhstan for retirement annuity products and employer liability annuities, and on the reinsurer's mortality tables for other portfolios. Lapse rates are determined based on the Group's historical experience, analyzed by portfolio and policy duration. Policy maintenance expenses reflect the current level of per-policy costs, adjusted for the expected rate of inflation. Cash flow assumptions are reviewed and, if a change is warranted, updated at least annually. The effect of changes in cash flow assumptions is recognized within Insurance claims and policyholder benefits, net of reinsurance, in net income in the period of the change. The effect of differences between actual experience and expected experience (experience adjustments) is also recognized within the same line item in the period in which the differences arise.\n\nDiscount rate\n\nThe LFPB is measured using a discount rate equivalent to the yield of upper-medium grade (low-credit-risk) fixed-income instruments, reflecting the duration characteristics and currency of the liability. For tenge-denominated long-duration contracts, the Group derives the discount curve from the Kazakhstan sovereign yield curve, fitted using the Nelson-Siegel parametric model with parameters published by the Kazakhstan Stock Exchange (KASE). For U.S. dollar-denominated long-duration contracts, the Group uses the U.S. Treasury High Quality Market (HQM) yield curve published by the Board of Governors of the Federal Reserve System. The discount rate is updated quarterly. The interest accrual on the LFPB, recorded within Insurance claims and policyholder benefits, net of reinsurance, uses a locked-in discount rate, which is the upper-medium grade rate at the date of contract issuance (or the transition date, April 1, 2023, for contracts in force at that date). The difference between the LFPB measured at the current discount rate and the LFPB measured at the locked-in rate is recognized in other comprehensive income within Change in discount rate on liability for future policy benefits, net of tax.\n\nNet premium ratio\n\nThe net premium ratio is calculated at contract issue (or at the transition date for in-force contracts) and is capped at 100%. The ratio is updated when cash flow assumptions are changed or when actual experience differs from expected experience. If the net premium ratio would exceed 100% as a result of such update, the ratio is capped at 100% and the excess is recognized as an immediate loss within Insurance claims and policyholder benefits, net of reinsurance.\n\nDeferred profit liability\n\nFor limited-payment long-duration insurance contracts, the Group records a deferred profit liability (DPL) when gross premiums received or due exceed the net premiums required to provide for expected future policy benefits and related expenses. Because the collection of premiums under limited-payment contracts does not represent the completion of the earnings process, the excess of gross premiums over net premiums is deferred and included within Insurance contract liabilities on the consolidated balance sheet. The deferred profit liability is measured using assumptions that are consistent with those used in measuring the related liability for future policy benefits, including mortality, lapse rates, and policy maintenance expenses. The deferred profit liability is subsequently recognized in net insurance revenue over the expected life of the related contracts in a constant relationship with the discounted amount of insurance in force for life insurance\n\n129\n\n[Table of Contents](#i70ff496d74d2478e8fff6b413c2fcd4c_7)\n\nFREEDOM HOLDING CORP.\n\nNOTES TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS MARCH 31, 2026\n\n(All amounts in thousands of United States dollars, except share data, unless otherwise stated)\n\ncontracts or the discounted amount of expected future benefit payments for annuity contracts. Interest accretes to the unamortized deferred profit liability using the original discount rate determined at contract issuance, or the transition date for contracts in force at the transition date, as applicable, and is recognized within net insurance revenue.\n\nThe Group reviews and updates cash flow assumptions used to measure the deferred profit liability contemporaneously with the review of assumptions used to measure the related liability for future policy benefits. Changes in the deferred profit liability resulting from assumption updates or differences between actual experience and expected experience are recognized in current-period earnings within net insurance revenue as a deferred profit liability remeasurement gain or loss. Amounts released from the deferred profit liability are recognized within net insurance revenue as deferred profit liability amortization or release.\n\nPolicyholder Dividends\n\nThe Company may, at its sole discretion, declare and pay dividends to certain pension policyholders. Such dividends are not contractually guaranteed and are not legally or constructively obligated prior to declaration by the Company.\n\nBecause the payment of these dividends is subject to the Company's discretionary approval and does not represent a present obligation as of the reporting date, no liability is recognized within future policy benefit reserves, deferred profit liabilities, or other policyholder benefit liabilities. These costs are expensed as incurred.\n\nSegment information\n\nFrom the beginning of calendar 2024, our Chief Executive Officer, Chief Financial Officer and President, who collectively act as our chief operating decision maker (CODM), began to manage our business, make operating decisions, and evaluate operating performance on the basis of a new segmental structure. As a result, we have realigned our reportable segments into the following four segments: Brokerage, Banking, Insurance, and Other. All prior period segment information has been recast to reflect this change in reportable segments.\n\nThe Company used the management approach to identify its reportable segments, as required by ASC 280. The management approach is based on the way the Company's management organizes and evaluates its operations, and based on the way the Company's operations are managed and reported in its internal financial reporting system.\n\nThe Company evaluated whether its segments met the quantitative thresholds to be reportable separately. The quantitative thresholds require that a segment's revenue is 10% or more of the combined revenue of all segments, or its absolute profit or loss is 10% or more of the greater of the combined absolute profit of all segments that have a positive profit or the combined absolute loss of all segments that have a loss. The Brokerage, Banking and Insurance segments were identified under the quantitative thresholds.\n\nUnder the management approach, the Company identified the Brokerage, Banking, Insurance and Other segments as its reportable segments as they are managed separately. The performance of all segments is regularly reviewed by the CODM.\n\nFactors Used in Determining Reportable Segments\n\nThe Company considered several factors when determining its reportable segments. These factors include similarities and differences among its products, services, economic factors, and internal reporting.\n\nThe Company considered the similarities and differences among its business to determine whether they should be aggregated or reported separately. Each business was determined to be sufficiently different from other businesses and therefore should be reported separately.\n\nThe Company also considered the economic factors that affect its operating segments, such as the regulatory environment, competitive landscape, and market conditions, to determine whether they should be reported separately. Reportable regions were determined to have unique economic factors that warranted separate reporting.\n\nThe information that is regularly reviewed by the CODM, including but not limited to the revenue, profit or loss, and assets, was also considered by the Company when determining its reportable segments. Each reportable segment was determined to be regularly reviewed by the CODM and therefore should be reported separately. All prior period segment information has been recast to reflect this change in reportable segments.\n\n130\n\n[Table of Contents](#i70ff496d74d2478e8fff6b413c2fcd4c_7)\n\nFREEDOM HOLDING CORP.\n\nNOTES TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS MARCH 31, 2026\n\n(All amounts in thousands of United States dollars, except share data, unless otherwise stated)\n\nRecent accounting pronouncements\n\nAdoption of ASU 2018-12 — Targeted Improvements to the Accounting for Long-Duration Contracts\n\nEffective for annual periods beginning April 1, 2025, the Company adopted ASU 2018-12, Financial Services — Insurance (Topic 944): Targeted Improvements to the Accounting for Long-Duration Contracts, as clarified and amended by ASU 2019-09 and ASU 2020-11 (collectively, \"LDTI\"), using the modified retrospective transition method with a transition date of April 1, 2023.\n\nLDTI changed existing recognition, measurement, presentation, and disclosure requirements for long-duration insurance contracts. The principal changes affecting the Company are: (1) a requirement to review and, if there is a change, update cash flow assumptions used to measure the liability for future policy benefits (LFPB) at least annually and to update the discount rate assumption quarterly, with assumption changes recognized within Insurance claims and policyholder benefits, net of reinsurance and discount rate changes recognized within Change in discount rate on liability for future policy benefits, net of tax in other comprehensive income; (2) simplified amortization for deferred acquisition costs (DAC) on a constant-level basis over the expected contract term, replacing the previous coverage-period approach; and (3) enhanced financial statement presentation and disclosures, including disaggregated rollforwards of the LFPB and DAC.\n\nThe Company applied the modified retrospective transition approach to all long-duration contracts in force as of the transition date. Under this approach, the carrying amount of the LFPB at April 1, 2023 was adjusted to remove any related amounts in accumulated other comprehensive income (AOCI), and the LFPB was remeasured using the current upper-medium grade discount rate as of the transition date. DAC balances at the transition date were not adjusted; however, subsequent amortization follows the new straight-line method. Prior comparative periods (fiscal years 2024 and 2025) have been recast to reflect the adoption of LDTI. The quantitative effects of adoption on the consolidated financial statements are disclosed in Note 3.\n\nIn connection with the adoption of LDTI, the Company renamed the following line items in its consolidated financial statements to accommodate the broader scope of LDTI-related activity: \"Insurance underwriting income\" was renamed to \"Net insurance revenue\"; \"Insurance claims incurred, net of reinsurance\" was renamed to \"Insurance claims and policyholder benefits, net of reinsurance\". A new line \"Change in discount rate on liability for future policy benefits, net of tax\" was added to the statement of other comprehensive income. Prior-period amounts have been conformed to the current-period presentation. These are changes in presentation only and have no effect on previously reported total revenue, total expense, net income, total assets, or total liabilities.\n\nAdoption of ASU 2023-09 — Income Taxes: Improvements to Income Tax Disclosures\n\nIn December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, which would require additional transparency for income tax disclosures, including the income tax rate reconciliation table and cash taxes paid both in the United States and foreign jurisdictions. This standard is effective for annual periods beginning after December 15, 2024. The Company adopted ASU No 2023-09 effective April 1, 2025.\n\nRecent accounting pronouncements not yet adopted\n\nIn October 2023, the FASB issued Accounting Standards Update No. 2023-06 (\"ASU 2023-06\"), Disclosure Improvements - Codification Amendment in Response to the SEC's Disclosure Update and Simplification Initiative. ASU 2023-06 modified the disclosure and presentation requirements of a variety of codification topics by aligning them with the SEC's regulations. The amendments to the various topics should be applied prospectively, and the effective date will be determined for each individual disclosure based on the effective date of the SEC's removal of the related disclosure. If the SEC has not removed the applicable requirements from Regulation S-X or Regulation S-K by June 30, 2027, then ASU 2023-06 will not become effective. Early adoption is prohibited. While the Company is currently evaluating the effect that implementation of this update will have on its consolidated financial statements, no material impact is anticipated.\n\nIn November 2024, the FASB issued ASU No. 2024-03, \"Income Statement – Reporting Comprehensive Income – Expense Disaggregation Disclosures\" (Subtopic 220-40). The amendments in this Update require disclosure, in the notes to financial statements, of specified information about certain costs and expenses. The amendments in this Update are effective for annual reporting periods beginning after December 15, 2026, and interim reporting periods beginning after December 15, 2027. Early adoption is permitted. The amendments in this Update should be applied either (1) prospectively to financial statements issued for reporting periods after the effective date of this Update or (2) retrospectively to any or all\n\n131\n\n[Table of Contents](#i70ff496d74d2478e8fff6b413c2fcd4c_7)\n\nFREEDOM HOLDING CORP.\n\nNOTES TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS MARCH 31, 2026\n\n(All amounts in thousands of United States dollars, except share data, unless otherwise stated)\n\nprior periods presented in the financial statements. The Company is currently evaluating the impact that ASU No 2024-03 will have on its consolidated financial statements and related disclosures.\n\nIn November 2024, the FASB issued ASU No. 2024-04, \"Debt-Debt with Conversion and Other Options\" (Subtopic 470-20). The amendments in this Update clarify the requirements for determining whether certain settlements of convertible debt instruments should be accounted for as an induced conversion. The amendments in this Update are effective for all entities for annual reporting periods beginning after December 15, 2025, and interim reporting periods within those annual reporting periods. Early adoption is permitted for all entities that have adopted the amendments in Update 2020-06. The amendments in this Update permit an entity to apply the new guidance on either a prospective or a retrospective basis. The Company is currently evaluating the impact that ASU No 2024-04 will have on its consolidated financial statements and related disclosures.\n\nIn May 2025, the FASB issued ASU No. 2025-03, “Business Combinations (Topic 805) and Consolidation (Topic 810): Determining the Accounting Acquirer in the Acquisition of a Variable Interest Entity”. The amendments in this update affect entities involved in acquisition transactions effected primarily by exchanging equity interest when the legal acquiree is a VIE that meets the definition of a business. The amendments in this update are effective for all entities for annual reporting periods beginning after December 15, 2026, and interim reporting periods within those annual reporting periods. The amendments in this update require that an entity apply the new guidance prospectively to any acquisition transaction that occurs after the initial application date. Early adoption is permitted as of the beginning of an interim or annual reporting period. The Company is currently evaluating the impact that ASU No 2025-03 will have on its consolidated financial statements and related disclosures.\n\nIn May 2025, the FASB issued ASU No. 2025-04, “Compensation-Stock Compensation (Topic 718) and Revenue from Contracts with Customers (Topic 606): Clarifications to Share-Based Consideration Payable to a Customer”. The amendments in this update affect all entities that issue share-based consideration to a customer that is within the scope of Topic 606. The amendments in this update are effective for all entities for annual reporting periods (including interim reporting periods within annual reporting periods) beginning after December 15, 2026. Early adoption is permitted for all entities. The amendments in this update permit a grantor to apply the new guidance on either a modified retrospective or a retrospective basis. The Company is currently evaluating the impact that ASU No 2025-04 will have on its consolidated financial statements and related disclosures.\n\nIn July 2025, the FASB issued ASU No. 2025-05, “Financial instruments – Credit Losses (Topic 326): Measurement of Credit Losses for Accounts Receivable and Contract Assets”. The amendments in this update provide (1) all entities with a practical expedient and (2) entities other than public business entities with an accounting policy election when estimating expected credit losses for current accounts receivable and current contract assets arising from transactions accounted for under Topic 606. An entity that elects the practical expedient and the accounting policy election, if applicable, should apply the amendments in this update prospectively. The amendments will be effective for annual reporting periods beginning after December 15, 2025, and interim reporting periods within those annual reporting periods. Early adoption is permitted in both interim and annual reporting periods in which financial statements have not yet been issued or made available for issuance. The Company is currently evaluating the impact that ASU No 2025-05 will have on its consolidated financial statements and related disclosures.\n\nIn September 2025, the FASB issued ASU No. 2025-06, “Intangibles – Goodwill and Other – Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software”. The amendments in this update apply to all entities subject to the internal-use software guidance in Subtopic 350-40. The amendments also apply to all entities that account for website development costs in accordance with Subtopic 350-50, Intangibles—Goodwill and Other—Website Development Costs. The amendments in this update are effective for all entities for annual reporting periods beginning after December 15, 2027, and interim reporting periods within those annual reporting periods. Early adoption is permitted as of the beginning of an annual reporting period. The amendments in this update permit an entity to apply the new guidance using any of the following transition approaches: a prospective transition approach, a modified transition approach that is based on the status of the project and whether software costs were capitalized before the date of adoption, A retrospective transition approach. The Company is currently evaluating the impact that ASU No 2025-06 will have on its consolidated financial statements and related disclosures.\n\nIn September 2025, the FASB issued ASU No. 2025-07, “Derivatives and Hedging (Topic 815) and Revenue from Contracts with Customers (Topic 606): Derivatives Scope Refinements and Scope Clarification for Share-Based Noncash Consideration from a Customer in a Revenue Contract”. The Board is issuing this update to address stakeholders’ concerns about the application of derivative accounting to contracts with features based on the operations or activities of one of the parties to the contract and the diversity in accounting for share-based noncash consideration from a customer that is\n\n132\n\n[Table of Contents](#i70ff496d74d2478e8fff6b413c2fcd4c_7)\n\nFREEDOM HOLDING CORP.\n\nNOTES TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS MARCH 31, 2026\n\n(All amounts in thousands of United States dollars, except share data, unless otherwise stated)\n\nconsideration for the transfer of goods or services. The amendments in this update are effective for all entities for annual reporting periods beginning after December 15, 2026, and interim reporting periods within those annual reporting periods. Early adoption is permitted. The Company is currently evaluating the impact that ASU No 2025-07 will have on its consolidated financial statements and related disclosures.\n\nIn November 2025, the FASB issued ASU No. 2025-08, Financial instruments – Credit losses (Topic 326): Purchased loans. The amendments in this update expand the population of acquired financial assets subject to the gross-up approach in Topic 326. The amendments in this update are effective for all entities for annual reporting periods beginning after December 15, 2026, and interim reporting periods within those annual reporting periods. Early adoption is permitted in an interim or annual reporting period in which financial statements have not yet been issued or made available for issuance. If an entity adopts the amendments in an interim reporting period, it should apply the amendments as of the beginning of that interim reporting period or the beginning of the annual reporting period that includes that interim reporting period.\n\nThe Company early adopted ASU 2025-08, applying amendments as of October 1, 2025. The Company adopted the guidance on a prospective basis to loans that are acquired on or after the initial application date, in accordance with the transition provisions of ASU 2025-08. Accordingly, the guidance applies to transactions occurring on or after the adoption date, the prior-period financial statements were not restated. The adoption of this ASU did not materially affect on the Company’s consolidated financial statements.\n\nIn November 2025, the FASB issued ASU No. 2025-09, “Derivatives and hedging (Topic 815): Hedge accounting improvements”. The amendments in this update apply to any entity that elects to apply hedge accounting in accordance with Topic 815. For public business entities, the amendments in this update are effective for annual reporting periods beginning after December 15, 2026, and interim periods within those annual reporting periods. For entities other than public business entities, the amendments are effective for annual reporting periods beginning after December 15, 2027, and interim periods within those annual reporting periods. Early adoption is permitted on any date on or after the issuance of this update. The Company is currently evaluating the impact that ASU No 2025-09 will have on its consolidated financial statements and related disclosures.\n\nIn December 2025, the FASB issued ASU No. 2025-10, “Government grants (Topic 832): Accounting for government grants received by business entities”. The amendments in this update apply to business entities (specifically, all entities except for not-for-profit entities and employee benefit plans) that receive a government grant. For public business entities, the amendments in this update are effective for annual reporting periods beginning after December 15, 2028, and interim reporting periods within those annual reporting periods. For entities other than public business entities, the amendments are effective for annual reporting periods beginning after December 15, 2029, and interim reporting periods within those annual reporting periods. The Company is currently evaluating the impact that ASU No 2025-10 will have on its consolidated financial statements and related disclosures.\n\nIn December 2025, the FASB issued ASU No. 2025-11, Interim Reporting (Topic 270): Narrow-Scope Improvements. The Board is issuing amendments in this update to improve the guidance in Topic 270, Interim Reporting, by improving the navigability of the required interim disclosures and clarifying when that guidance is applicable. The amendments also provide additional guidance on what disclosures should be provided in interim reporting periods. The amendments add to Topic 270 a principle that requires entities to disclose events since the end of the last annual reporting period that have a material impact on the entity. The amendments in this update are effective for interim reporting periods within annual reporting periods beginning after December 15, 2027, for public business entities and for interim reporting periods within annual reporting periods beginning after December 15, 2028, for entities other than public business entities. Early adoption is permitted for all entities. The Company is currently evaluating the impact that ASU No 2025-11 will have on its consolidated financial statements and related disclosures.\n\nIn December 2025, the FASB issued ASU 2025-12, Codification improvements. Thirty-three issues are addressed in this update. The amendments in this update represent changes to the Codification that clarify, correct errors, or make minor improvements. The amendments in this update are effective for all entities for annual reporting periods beginning after December 15, 2026, and interim reporting periods within those annual reporting periods. The Company is currently evaluating the impact that ASU No 2025-12 will have on its consolidated financial statements and related disclosures.\n\n133\n\n[Table of Contents](#i70ff496d74d2478e8fff6b413c2fcd4c_7)\n\nFREEDOM HOLDING CORP.\n\nNOTES TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS MARCH 31, 2026\n\n(All amounts in thousands of United States dollars, except share data, unless otherwise stated)\n\nNOTE 3 - RECAST\n\nEffective April 1, 2025, the Company adopted Accounting Standards Update 2018-12, Financial Services — Insurance (Topic 944): Targeted Improvements to the Accounting for Long-Duration Contracts (\"LDTI\"), as amended by ASU 2019-09 and ASU 2020-11, using the modified retrospective transition method. The transition date is April 1, 2023, which is the beginning of the earliest period presented in these consolidated financial statements.\n\nThe comparative financial statements for the fiscal years ended March 31, 2025 and March 31, 2024 have been recast to reflect the effects of LDTI adoption. The adoption affected only the measurement and presentation of long-duration insurance contracts (life insurance and annuity contracts written by Freedom Life); it did not change the accounting for the Group's short-duration insurance contracts or any non-insurance line items. In connection with the adoption, the Group renamed the following financial statement line items: \"Insurance underwriting income\" to \"Net insurance revenue\"; \"Insurance claims incurred, net of reinsurance\" to \"Insurance claims and policyholder benefits, net of reinsurance\"; and \"Liabilities from insurance activity\" to \"Insurance contract liabilities\". A new line \"Change in discount rate on liability for future policy benefits\" was added to other comprehensive income. These are presentational changes only; prior-period amounts have been conformed to the current-period presentation. The adoption of LDTI did not change net cash provided by or used in operating, investing, or financing activities for any period presented.\n\n134\n\n[Table of Contents](#i70ff496d74d2478e8fff6b413c2fcd4c_7)\n\nFREEDOM HOLDING CORP.\n\nNOTES TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS MARCH 31, 2026\n\n(All amounts in thousands of United States dollars, except share data, unless otherwise stated)\n\nMarch 31, 2025\n\nAs previously reportedEffect of adoption of ASU 2018-12As recasted\n\nASSETS\n\nCash and cash equivalents$837,302 $— $837,302 \n\nRestricted cash807,468 — 807,468 \n\nInvestment securities2,814,733 — 2,814,733 \n\nMargin lending, brokerage and other receivables, net\n3,319,145 — 3,319,145 \n\nLoans issued 1,595,435 — 1,595,435 \n\nFixed assets, net191,103 — 191,103 \n\nIntangible assets, net54,186 — 54,186 \n\nGoodwill49,093 — 49,093 \n\nRight-of-use asset39,828 — 39,828 \n\nInsurance contract assets37,183 — 37,183 \n\nOther assets, net 168,541 1,100 169,641 \n\nTOTAL ASSETS$9,914,017 $1,100 $9,915,117 \n\nLIABILITIES AND SHAREHOLDERS' EQUITY\n\nSecurities repurchase agreement obligations$1,418,443 $— $1,418,443 \n\nCustomer liabilities\n4,304,999 — 4,304,999 \n\nMargin lending and trade payables\n1,322,241 — 1,322,241 \n\nInsurance contract liabilities481,539 (9,106)472,433 \n\nCurrent income tax liability28,919 — 28,919 \n\nDebt securities issued469,551 — 469,551 \n\nLease liability40,525 — 40,525 \n\nLiability arising from continuing involvement503,705 — 503,705 \n\nOther liabilities129,737 — 129,737 \n\nTOTAL LIABILITIES$8,699,659 $(9,106)$8,690,553 \n\nCommitments and Contingent Liabilities (Note 29)— — — \n\nSHAREHOLDERS' EQUITY\n\nPreferred stock - $0.001 par value; $20,000,000 shares authorized, no shares issued or outstanding\n— — — \n\nCommon stock - $0.001 par value; 500,000,000 shares authorized; 60,993,949 shares issued and outstanding as of March 31, 2025\n61 — 61 \n\nAdditional paid in capital246,610 — 246,610 \n\nRetained earnings1,085,565 (7,393)1,078,172 \n\nAccumulated other comprehensive loss(117,995)17,599 (100,396)\n\nTOTAL FRHC SHAREHOLDERS' EQUITY$1,214,241 $10,206 $1,224,447 \n\nNon-controlling interest117 — 117 \n\nTOTAL SHAREHOLDERS' EQUITY$1,214,358 $10,206 $1,224,564 \n\nTOTAL LIABILITIES AND SHAREHOLDERS' EQUITY$9,914,017 $1,100 $9,915,117 \n\n135\n\n[Table of Contents](#i70ff496d74d2478e8fff6b413c2fcd4c_7)\n\nFREEDOM HOLDING CORP.\n\nNOTES TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS MARCH 31, 2026\n\n(All amounts in thousands of United States dollars, except share data, unless otherwise stated)\n\nYear ended March 31, 2025\n\nAs reportedEffect of adoption of ASU 2018-12As recasted\n\nRevenue: \n\nFee and commission income$505,026 $— $505,026 \n\nNet loss on trading securities(57,810)— (57,810)\n\nInterest income864,453 — 864,453 \n\nNet insurance revenue617,596 (46,372)571,224 \n\nNet gain on foreign exchange operations51,684 — 51,684 \n\nNet gain on derivatives12,404 — 12,404 \n\nSales of goods and services40,102 — 40,102 \n\nOther income17,072 — 17,072 \n\nTOTAL REVENUE, NET2,050,527 (46,372)2,004,155 \n\nExpense:\n\nFee and commission expense 346,074 428 346,502 \n\nInterest expense535,895 — 535,895 \n\nInsurance claims and policyholders benefits, net of reinsurance298,109 (37,621)260,488 \n\nPayroll and bonuses288,163 (816)287,347 \n\nProfessional services28,924 — 28,924 \n\nStock compensation expense59,592 — 59,592 \n\nAdvertising and sponsorship expense124,627 — 124,627 \n\nGeneral and administrative expense162,474 — 162,474 \n\nAllowance for expected credit losses62,445 — 62,445 \n\nCost of sales31,278 — 31,278 \n\nTOTAL EXPENSE1,937,581 (38,009)1,899,572 \n\nINCOME BEFORE INCOME TAX112,946 (8,363)104,583 \n\nIncome tax expense(28,425)— (28,425)\n\nNET INCOME 84,521 (8,363)76,158 \n\nLess: Net loss attributable to non-controlling interest in subsidiary(129)— (129)\n\nNET INCOME/(LOSS) ATTRIBUTABLE TO COMMON SHAREHOLDERS$84,650 $(8,363)$76,287 \n\nOTHER COMPREHENSIVE INCOME\n\nChange in unrealized gain on investments available-for-sale, net of tax effect 4,364 — 4,364 \n\n136\n\n[Table of Contents](#i70ff496d74d2478e8fff6b413c2fcd4c_7)\n\nFREEDOM HOLDING CORP.\n\nNOTES TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS MARCH 31, 2026\n\n(All amounts in thousands of United States dollars, except share data, unless otherwise stated)\n\nReclassification adjustment for net realized loss on available-for-sale investments disposed of in the period, net of tax effect681 — 681 \n\nChange in discount rate on liability for future policy benefits— 6,807 6,807 \n\nForeign currency translation adjustments(104,102)— (104,102)\n\nOTHER COMPREHENSIVE (LOSS)/INCOME(99,057)6,807 (92,250)\n\nCOMPREHENSIVE LOSS BEFORE NON-CONTROLLING INTERESTS$(14,536)$(1,556)$(16,092)\n\nLess: Comprehensive loss attributable to non-controlling interest in subsidiary(129)— (129)\n\nCOMPREHENSIVE LOSS ATTRIBUTABLE TO COMMON SHAREHOLDERS$(14,407)$(1,556)$(15,963)\n\n137\n\n[Table of Contents](#i70ff496d74d2478e8fff6b413c2fcd4c_7)\n\nFREEDOM HOLDING CORP.\n\nNOTES TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS MARCH 31, 2026\n\n(All amounts in thousands of United States dollars, except share data, unless otherwise stated)\n\nYear ended March 31, 2024\n\nAs reportedEffect of adoption of ASU 2018-12As recasted\n\nRevenue: \n\nFee and commission income$440,333 $— $440,333 \n\nNet gain on trading securities133,854 — 133,854 \n\nInterest income828,224 — 828,224 \n\nNet insurance revenue264,218 (19,096)245,122 \n\nNet gain on foreign exchange operations72,245 — 72,245 \n\nNet loss on derivatives(103,794)— (103,794)\n\nSales of goods and services21,576 — 21,576 \n\nOther income9,696 — 9,696 \n\nTOTAL REVENUE, NET1,666,352 (19,096)1,647,256 \n\nExpense:\n\nFee and commission expense 154,351 365 154,716 \n\nInterest expense501,111 — 501,111 \n\nInsurance claims and policyholder benefits, net of reinsurance139,561 (22,288)117,273 \n\nPayroll and bonuses181,023 (740)180,283 \n\nProfessional services34,238 — 34,238 \n\nStock compensation expense22,719 — 22,719 \n\nAdvertising and sponsorship expense38,327 — 38,327 \n\nGeneral and administrative expense120,888 — 120,888 \n\nAllowance for expected credit losses21,225 — 21,225 \n\nCost of sales17,538 — 17,538 \n\nTOTAL EXPENSE1,230,981 (22,663)1,208,318 \n\nINCOME BEFORE INCOME TAX435,371 3,567 438,938 \n\nIncome tax expense(60,419)— (60,419)\n\nNET INCOME 374,952 3,567 378,519 \n\nLess: Net loss attributable to non-controlling interest in subsidiary(588)— (588)\n\nNET INCOME ATTRIBUTABLE TO COMMON SHAREHOLDERS$375,540 $3,567 $379,107 \n\nOTHER COMPREHENSIVE INCOME\n\nChange in unrealized gain on investments available-for-sale, net of tax effect 6,196 — 6,196 \n\n138\n\n[Table of Contents](#i70ff496d74d2478e8fff6b413c2fcd4c_7)\n\nFREEDOM HOLDING CORP.\n\nNOTES TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS MARCH 31, 2026\n\n(All amounts in thousands of United States dollars, except share data, unless otherwise stated)\n\nReclassification adjustment for net realized loss on available-for-sale investments disposed of in the period, net of tax effect(3,209)— (3,209)\n\nChange in discount rate on liability for future policy benefits— (4,811)(4,811)\n\nForeign currency translation adjustments12,075 — 12,075 \n\nOTHER COMPREHENSIVE INCOME/(LOSS)15,062 (4,811)10,251 \n\nCOMPREHENSIVE INCOME/(LOSS) BEFORE NON-CONTROLLING INTERESTS$390,014 $(1,244)$388,770 \n\nLess: Comprehensive loss attributable to non-controlling interest in subsidiary(588)— (588)\n\nCOMPREHENSIVE (LOSS)/INCOME ATTRIBUTABLE TO COMMON SHAREHOLDERS$390,602 $(1,244)$389,358 \n\nNature of principal adjustments\n\nThe LDTI recast adjustments consist of:\n\n(a) Liability for future policy benefits. The LFPB for the Group's long-duration life insurance and annuity contracts was remeasured under the net premium ratio approach of ASC 944-40 as amended by LDTI. At the transition date (April 1, 2023), the LFPB carrying amount was adjusted to remove amounts previously recorded in AOCI and was remeasured using the upper-medium grade discount rate. For recast periods after the transition date, the LFPB reflects annual cash flow assumption reviews (recognized within Insurance claims and policyholder benefits, net of reinsurance) and quarterly discount rate updates (recognized within Change in discount rate on liability for future policy benefits, net of tax in OCI). The LFPB is included within Insurance contract liabilities on the consolidated balance sheet.\n\n(b) Deferred acquisition costs. Under LDTI, DAC on long-duration contracts is amortized on a straight-line basis over the expected contract term, replacing the Group's previous method of amortization over the coverage period of the related contracts. DAC balances at the transition date were not adjusted; the change in amortization method was applied prospectively from the transition date. DAC is included within Insurance contract assets.\n\n(c) Accumulated other comprehensive income. AOCI was adjusted at the transition date to reflect the difference between the LFPB measured at the locked-in discount rate and at the current upper-medium grade discount rate at April 1, 2023. Subsequent quarterly discount rate updates result in remeasurement gains or losses recognized within Change in discount rate on liability for future policy benefits, net of tax.\n\n(d) Disaggregated presentation. Under LDTI, the Group disaggregates Insurance contract liabilities between long-duration contracts (LFPB) and short-duration claims reserves within Note 17. Comparative periods have been recast to reflect this disaggregation.\n\n(e) Line item renames. The Group renamed certain financial statement line items in connection with LDTI adoption as described above and in Note 2.\n\n139\n\n[Table of Contents](#i70ff496d74d2478e8fff6b413c2fcd4c_7)\n\nFREEDOM HOLDING CORP.\n\nNOTES TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS MARCH 31, 2026\n\n(All amounts in thousands of United States dollars, except share data, unless otherwise stated)\n\nNOTE 4 - CASH AND CASH EQUIVALENTS\n\nMarch 31, 2026March 31, 2025\n\nShort term deposits in National Bank (Kazakhstan)$328,242 $311,065 \n\nShort term deposits in commercial banks292,879 262,345 \n\nSecurities purchased under reverse repurchase agreements207,893 81,118 \n\nPetty cash in bank vault and on hand97,595 59,533 \n\nCash in transit18,710 10,546 \n\nOvernight deposits6,972 81,962 \n\nShort term deposits on brokerage accounts5,621 20,567 \n\nShort term deposits in the Central Depository (Kazakhstan)3,904 510 \n\nShort term deposits in stock exchanges3,686 2,391 \n\nShort term deposits in National Bank (Tajikistan)1,136 7,647 \n\nOther short term deposits and accounts211 — \n\nAllowance for Cash and cash equivalents(734)(382)\n\nTotal cash and cash equivalents$966,115 $837,302 \n\nAs of March 31, 2026 and 2025 cash and cash equivalents balance included short-term collateralized securities received under reverse repurchase agreements which the Group concludes mainly on KASE. KASE, in turn, guarantees payments to the counterparty. The terms of the short-term collateralized securities received under reverse repurchase agreements as of March 31, 2026 and 2025 are presented below:\n\nMarch 31, 2026\n\nInterest rates and remaining contractual maturity of the agreements\n\nAverage\ninterest rateUp to 30\ndaysTotal\n\nSecurities purchased under reverse repurchase agreements\n\nCorporate equity17.78 %$127,652 $127,652 \n\nNon-US sovereign debt13.15 %66,295 66,295 \n\nCorporate debt7.79 %13,946 13,946 \n\nTotal$207,893 $207,893 \n\nMarch 31, 2025\n\nInterest rates and remaining contractual maturity of the agreements\n\nAverage\n\ninterest rate\nUp to 30\ndaysTotal\n\nSecurities purchased under reverse repurchase agreements\n\nCorporate equity17.05 %$58,202 $58,202 \n\nCorporate debt13.27 %16,644 16,644 \n\nNon-US sovereign debt4.48 %4,436 4,436 \n\nUS sovereign debt16.75 %1,836 1,836 \n\nTotal$81,118 $81,118 \n\n140\n\n[Table of Contents](#i70ff496d74d2478e8fff6b413c2fcd4c_7)\n\nFREEDOM HOLDING CORP.\n\nNOTES TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS MARCH 31, 2026\n\n(All amounts in thousands of United States dollars, except share data, unless otherwise stated)\n\nThe securities received by the Group as collateral under reverse repurchase agreements are liquid trading securities with market quotes and significant trading volume. The fair value of collateral received by the Group under reverse repurchase agreements as of March 31, 2026 and 2025, was $207,846 and $82,140 respectively.\n\nAs of March 31, 2026 and March 31, 2025, securities purchased under reverse repurchase agreements included accrued interest in the amount of $107 and $5, with a weighted average maturity of 1 day and 1 day, respectively. All securities repurchase agreements transactions were executed through the KASE.\n\nNOTE 5 - RESTRICTED CASH\n\nRestricted cash for the periods ended March 31, 2026 and 2025, consisted of:\n\n March 31, 2026March 31, 2025\n\n \n\nBrokerage customers' cash$1,095,026 $737,546 \n\nGuaranty deposits135,258 70,026 \n\nShort term placements16,368 — \n\nRestricted bank accounts9,436 8,122 \n\nDue from banks6,183 6,904 \n\nDeferred distribution payment23 23 \n\nAllowance for restricted cash(15,982)(15,153)\n\nTotal restricted cash$1,246,312 $807,468 \n\nAs of March 31, 2026, and March 31, 2025, part of the Group's restricted cash was segregated in a special custody accounts for the exclusive benefit of the relevant brokerage customers.\n\nAs of March 31, 2026, and March 31, 2025, the Group had brokerage customers’ cash with a single non-related prime broker that individually exceeded 10% of the Group’s total restricted cash in the amount of $684,476 and $368,196, respectively.\n\n141\n\n[Table of Contents](#i70ff496d74d2478e8fff6b413c2fcd4c_7)\n\nFREEDOM HOLDING CORP.\n\nNOTES TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS MARCH 31, 2026\n\n(All amounts in thousands of United States dollars, except share data, unless otherwise stated)\n\nNOTE 6 - INVESTMENT SECURITIES\n\nAs of March 31, 2026 and 2025, trading, held-to-maturity and available-for-sale securities consisted of:\n\nMarch 31, 2026March 31, 2025\n\nNon-U.S. sovereign debt$1,337,577 $1,282,450 \n\nCorporate debt793,850 807,985 \n\nCorporate equity166,394 106,227 \n\nU.S. sovereign debt33,060 73,787 \n\nExchange traded notes8,219 4,837 \n\nTotal trading securities$2,339,100 $2,275,286 \n\n  \n\nCorporate debt311,604 243,730 \n\nNon-US sovereign debt240,453 208,231 \n\nUS sovereign debt21,981 21,626 \n\nTotal available-for-sale securities, at fair value$574,038 $473,587 \n\nNon-US sovereign debt429,660 65,914 \n\nAllowance for Non-US sovereign debt\n(237)(54)\n\nTotal held-to-maturity securities$429,423 $65,860 \n\nTotal investment securities$3,342,561 $2,814,733 \n\nThe following tables present maturity analysis for available-for-sale securities as of March 31, 2026 and March 31, 2025:\n\nMarch 31, 2026\n\nRemaining contractual maturity of the agreements\n\nUp to 1 year1-5 years5-10 yearsMore than 10 yearsTotal\n\nCorporate debt$24,824 $210,742 $72,497 $3,541 $311,604 \n\nNon-US sovereign debt7,378 63,767 167,372 1,936 240,453 \n\nUS sovereign debt10,940 9,870 — 1,171 21,981 \n\nTotal available-for-sale securities, at fair value$43,142 $284,379 $239,869 $6,648 $574,038 \n\nMarch 31, 2025\n\nRemaining contractual maturity of the agreements\n\nUp to 1 year1-5 years5-10 yearsMore than 10 yearsTotal\n\nCorporate debt$85,300 $141,382 $9,308 $7,740 $243,730 \n\nNon-US sovereign debt66,593 96,662 29,136 15,840 208,231 \n\nUS sovereign debt— 20,421 — 1,205 21,626 \n\nTotal available-for-sale securities, at fair value$151,893 $258,465 $38,444 $24,785 $473,587 \n\n142\n\n[Table of Contents](#i70ff496d74d2478e8fff6b413c2fcd4c_7)\n\nFREEDOM HOLDING CORP.\n\nNOTES TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS MARCH 31, 2026\n\n(All amounts in thousands of United States dollars, except share data, unless otherwise stated)\n\nThe following table presents maturity analysis for held-to-maturity securities as of March 31, 2026 and March 31, 2025:\n\nMarch 31, 2026\n\nRemaining contractual maturity of the agreements\n\nUp to 1 year1-5 years5-10 yearsMore than 10 yearsTotal\n\nNon-US sovereign debt— 195,701 138,207 95,515 429,423 \n\nTotal held-to-maturity securities\n$— $195,701 $138,207 $95,515 $429,423 \n\nMarch 31, 2025\n\nRemaining contractual maturity of the agreements\n\nUp to 1 year1-5 years5-10 yearsMore than 10 yearsTotal\n\nNon-US sovereign debt— — 11,931 53,929 65,860 \n\nTotal held-to-maturity securities$— $— $11,931 $53,929 $65,860 \n\nAs of March 31, 2026, the Group held debt securities of two issuers which individually exceeded 10% of the Group's total investment securities - the Ministry of Finance of the Republic of Kazakhstan (Fitch: BBB credit rating) in the amount of $1,897,085 and Kazakhstan Sustainability Fund JSC (Fitch: BBB credit rating) in the amount of $544,306. As of March 31, 2025, the Group held debt securities of two issuers each of which individually exceeded 10% of the Group's total investment securities- the Ministry of Finance of the Republic of Kazakhstan (Fitch: BBB credit rating) in the amount of $1,527,340 and the Kazakhstan Sustainability Fund JSC (Fitch: BBB credit rating) in the amounts of $578,862. The debt securities issued by the Ministry of Finance of the Republic of Kazakhstan and Kazakhstan Sustainability Fund JSC are categorized as non-US sovereign debt and corporate debt, respectively.\n\nAs of March 31, 2026 and March 31, 2025, the Group recognized $376 and $406, respectively, other-than-temporary impairment in accumulated other comprehensive loss.\n\nThe fair value of securities is determined using observable market data based on recent trading activity. Where observable market data is unavailable due to a lack of trading activity, the Group utilizes internally developed models to estimate fair value and independent third parties to validate assumptions, when appropriate. Estimating fair value requires significant management judgment, including benchmarking to similar instruments with observable market data and applying appropriate discounts that reflect differences between the securities that the Group is valuing and the selected benchmark. Depending on the type of securities owned by the Group, other valuation methodologies may be required.\n\nMeasurement of fair value is classified within a hierarchy based upon the transparency of inputs used in the valuation of an asset or liability. Classification within the hierarchy is based upon the lowest level of input that is significant to the fair value measurement.\n\nThe valuation hierarchy contains three levels:\n\n•Level 1 - Valuation inputs are unadjusted quoted market prices for identical assets or liabilities in active markets.\n\n•Level 2 - Valuation inputs are quoted market prices for identical assets or liabilities in markets that are not active, quoted market prices for similar assets and liabilities in active markets, and other observable inputs directly or indirectly related to the asset or liability being measured.\n\n•Level 3 - Valuation inputs are unobservable and significant to the fair value measurement.\n\n143\n\n[Table of Contents](#i70ff496d74d2478e8fff6b413c2fcd4c_7)\n\nFREEDOM HOLDING CORP.\n\nNOTES TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS MARCH 31, 2026\n\n(All amounts in thousands of United States dollars, except share data, unless otherwise stated)\n\nThe following tables present trading securities assets in the Consolidated Financial Statements or disclosed in the Notes to the Consolidated Financial Statements at fair value on a recurring basis as of March 31, 2026 and March 31, 2025:\n\nWeighted\n\naverage\n\ninterest rate\nTotal\nFair Value Measurements at\n\nMarch 31, 2026 using\n\nQuoted Prices in Active\nMarkets for Identical\nAssetsSignificant Other\nObservable InputsSignificant unobservable\nunits\n\n(Level 1)(Level 2)(Level 3)\n\nNon-U.S. sovereign debt10.06 %$1,337,577 $693,830 $643,747 $— \n\nCorporate debt16.80 %793,850 542,401 250,371 1,078 \n\nCorporate equity— 166,394 141,270 3,927 21,197 \n\nU.S. sovereign debt3.89 %33,060 33,060 — — \n\nExchange traded notes— 8,219 6,019 2,200 — \n\nTotal trading securities$2,339,100 $1,416,580 $900,245 $22,275 \n\nCorporate debt16.41 %311,604 131,108 180,496 — \n\nNon-U.S. sovereign debt8.85 %240,453 74,055 166,398 — \n\nU.S. sovereign debt2.03 %21,981 21,981 — — \n\nTotal available-for-sale securities, at fair value$574,038 $227,144 $346,894 $— \n\nAs of March 31, 2026, the fair value of held-to-maturity securities, determined using Level 1 inputs, totaled $341,132, and using Level 2 inputs, totaled $108,533. The table below presents the amortized cost, gross unrealized holding gains, gross unrealized holding losses, and fair value of held-to-maturity securities as of March 31, 2026.\n\nMarch 31, 2026\n\nAssets measured at amortized costGross unrecognized holding gainsGross unrecognized holding lossesFair value of held-to-maturityMaturity Date\n\nNon-US sovereign debt429,423 26,423 (6,181)449,665 2027 - 2037\n\nTotal held-to-maturity securities\n$429,423 $26,423 $(6,181)$449,665 \n\n144\n\n[Table of Contents](#i70ff496d74d2478e8fff6b413c2fcd4c_7)\n\nFREEDOM HOLDING CORP.\n\nNOTES TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS MARCH 31, 2026\n\n(All amounts in thousands of United States dollars, except share data, unless otherwise stated)\n\nWeighted\n\naverage\n\ninterest rate\nTotal\nFair Value Measurements at\n\nMarch 31, 2025 using\n\nQuoted Prices in Active\nMarkets for Identical\nAssetsSignificant Other\nObservable InputsSignificant unobservable\nunits\n\n(Level 1)(Level 2)(Level 3)\n\nNon-U.S. sovereign debt11.24 %$1,282,450 $987,657 $294,793 $— \n\nCorporate debt13.93 %807,985 299,123 508,862 — \n\nCorporate equity— 106,227 81,810 6,097 18,320 \n\nU.S. sovereign debt3.99 %73,787 73,787 — — \n\nExchange traded notes— 4,837 2,369 2,468 — \n\nTotal trading securities$2,275,286 $1,444,746 $812,220 $18,320 \n\nCorporate debt14.81 %$243,730 $91,537 $152,193 $— \n\nNon-U.S. sovereign debt9.96 %208,231 128,772 79,459 — \n\nU.S. sovereign debt2.73 %21,626 21,626 — — \n\nTotal available-for-sale securities, at fair value$473,587 $241,935 $231,652 $— \n\nAs of March 31, 2025, the fair value of held-to-maturity securities, determined using Level 1 inputs, totaled $45,216, and using Level 2 inputs, totaled $19,736. The table below presents the amortized cost, gross unrealized holding gains, gross unrealized holding losses, and fair value of held-to-maturity securities as of March 31, 2025.\n\nMarch 31, 2025\n\nAssets measured at amortized costGross unrecognized holding gainsGross unrecognized holding lossesFair value of held-to-maturityMaturity Date\n\nNon-US sovereign debt65,860 332 (1,240)64,952 2031 - 2037\n\nTotal held-to-maturity securities\n$65,860 $332 $(1,240)$64,952 \n\n145\n\n[Table of Contents](#i70ff496d74d2478e8fff6b413c2fcd4c_7)\n\nFREEDOM HOLDING CORP.\n\nNOTES TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS MARCH 31, 2026\n\n(All amounts in thousands of United States dollars, except share data, unless otherwise stated)\n\nThe tables below present the Valuation Techniques and Significant Level 3 inputs used in the valuation as of March 31, 2026 and March 31, 2025. The table is not intended to be all inclusive, but instead captures the significant unobservable inputs relevant to determination of fair value.\n\nType\nValuation\n\nTechnique\nFV as of March 31, 2026Significant Unobservable Inputs%\n\n   \n\nCorporate equityDCF18,840 Discount rate9.0%\n\nEstimated number of years3 years\n\nTermination multiplier\n\n10.5x\n\nCorporate equityDCF2,223 Discount rate10.36%\n\nEstimated number of years6 years\n\nTermination multiplier\n\n0.935x\n\nCorporate debtDCF1,078 Discount rate13.2%\n\nEstimated number of years2 years\n\nCorporate equityDCF134 Discount rate58.8%\n\nEstimated number of years9 years\n\n$22,275 \n\nType\nValuation\n\nTechnique\nFV as of March 31, 2025Significant Unobservable Inputs%\n\n  \n\nCorporate equityDCF18,193 Discount rate21.5%\n\nEstimated number of years2 years\n\nTermination multiplier\n\n19.5x\n\nCorporate equityDCF127 Discount rate58.8%\n\nEstimated number of years9 years\n\n$18,320 \n\nThe following table provides a reconciliation of the beginning and ending balances for investments that use Level 3 inputs for the years ended March 31, 2026 and March 31, 2025:\n\nTrading\nsecurities\n\nBalance as of March 31, 2024\n$20,442 \n\n \n\nRevaluation of investments that use Level 3 inputs(2,122)\n\nBalance as of March 31, 2025\n$18,320 \n\n \n\nPurchase of investments that use Level 3 inputs2,222 \n\nRevaluation of investments that use Level 3 inputs633 \n\nReclassification to investment in associate1,093 \n\nForeign currency translation7 \n\nBalance as of March 31, 2026\n$22,275 \n\n146\n\n[Table of Contents](#i70ff496d74d2478e8fff6b413c2fcd4c_7)\n\nFREEDOM HOLDING CORP.\n\nNOTES TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS MARCH 31, 2026\n\n(All amounts in thousands of United States dollars, except share data, unless otherwise stated)\n\nThe table below presents the amortized cost, unrealized gains and losses accumulated in other comprehensive income, and fair value of available-for-sale securities as of March 31, 2026 and 2025:\n\nMarch 31, 2026\n\nAssets measured at amortized costRecognized impairment loss in Income StatementUnrealized gain/(loss) accumulated in other comprehensive\nincome/(loss) including foreign currency translation adjustments, netAssets\nmeasured at\nfair valueMaturity Date\n\nCorporate debt$304,548 $— $7,056 $311,604 2026 - 2039\n\nNon-US sovereign debt244,312 (376)(3,483)240,453 2026 - indefinite\n\nU.S. sovereign debt21,984 — (3)21,981 2027 - 2044\n\nTotal available-for-sale securities, at fair value$570,844 $(376)$3,570 $574,038 \n\nMarch 31, 2025\n\nAssets measured at amortized costRecognized impairment loss in Income StatementUnrealized (loss)/gain accumulated in other comprehensive\nincome/(loss) including foreign currency translation adjustments, netAssets\nmeasured at\nfair valueMaturity Date\n\nCorporate debt$243,660 $(28)$98 $243,730 2025 - 2039\n\nNon-US sovereign debt211,628 (378)(3,019)208,231 2025 - indefinite\n\nU.S. sovereign debt21,868 — (242)21,626 2027 - 2044\n\nTotal available-for-sale securities, at fair value$477,156 $(406)$(3,163)$473,587 \n\n147\n\n[Table of Contents](#i70ff496d74d2478e8fff6b413c2fcd4c_7)\n\nFREEDOM HOLDING CORP.\n\nNOTES TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS MARCH 31, 2026\n\n(All amounts in thousands of United States dollars, except share data, unless otherwise stated)\n\nNOTE 7 - MARGIN LENDING, BROKERAGE AND OTHER RECEIVABLES, NET\n\nMargin lending, brokerage and other receivables, as of March 31, 2026 and March 31, 2025, consisted of:\n\nMarch 31, 2026March 31, 2025\n\nMargin lending receivables$4,632,506 $3,294,569 \n\nReceivables from telecommunication services11,805 9,985 \n\nBank commissions receivable7,337 7,529 \n\nBond coupon receivable and dividends accrued9,785 6,832 \n\nReceivables from brokerage customers\n1,797 2,399 \n\nOther receivables47,511 17,087 \n\nAllowance for receivables(19,959)(19,256)\n\nTotal margin lending, brokerage and other receivables, net$4,690,782 $3,319,145 \n\nMargin lending receivables are amounts owed to the Group from customers as a result of borrowings by such customers against the value of qualifying securities, primarily for the purpose of purchasing additional securities. Amounts may fluctuate from period to period as overall customer balances change as a result of market levels, customer positioning and leverage. Credit exposures arising from margin lending activities are generally mitigated by their short-term nature, the value of collateral held and the Group's right to call for margin when collateral values decline.\n\nCollateral for margin lending receivables includes cash balances in customers' brokerage accounts and securities, adjusted for customers' off-balance sheet short positions, excluding the Company's own shares held by the clients in their brokerage accounts. As of March 31, 2026, and March 31, 2025, the fair value of collateral held by the Group under margin loans was $8,595,822 and $6,379,368, respectively.\n\nAs of March 31, 2026, and March 31, 2025, the Company had three non-related party customers and three non-related party customer whose individual balances exceeded 10% of the total margin lending, brokerage, and other receivables balance, amounted to $3,286,545 and $2,323,461, respectively. The collateral held from these non-related party customers was valued at $4,677,913 and $3,218,277 as of March 31, 2026, and March 31, 2025, respectively.\n\nFor both individual and institutional brokerage customers, the Group may enter into arrangements for securities financing transactions in respect of financial instruments held by the Group on behalf of the customer or may use such financial instruments for our own account or the account of another customer. The Group maintains omnibus brokerage accounts for our customers, including institutional brokerage customers, in which transactions of these customers and the underlying customers of these institutional brokerage customers are combined in a single omnibus account with our third party brokers. As noted above, the Group may use the assets within the omnibus accounts to finance, lend, provide credit or provide debt financing or otherwise use and direct the order or manner of assets for financing of other customers of ours. Where allowed by the regulations applicable to the Group, the Group may accept short sales from these institutional customers and as a result, the Group is only required to maintain positions with third party custodians for the net long positions in each security in the omnibus accounts and we refer to these as internalized trades.\n\nAs of March 31, 2026 and March 31, 2025, using actual, historical and statistical data, the Group recorded an allowance for brokerage and other receivables in the amounts of $19,959 and $19,256, respectively.\n\n148\n\n[Table of Contents](#i70ff496d74d2478e8fff6b413c2fcd4c_7)\n\nFREEDOM HOLDING CORP.\n\nNOTES TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS MARCH 31, 2026\n\n(All amounts in thousands of United States dollars, except share data, unless otherwise stated)\n\nNOTE 8 - LOANS ISSUED\n\nLoans issued as of March 31, 2026, consisted of the following:\n\nAmount OutstandingDue DatesAverage Interest Rate Fair Value of\nCollateralLoan Currency\n\n \n\nMortgage loans$1,149,000  April 2026 - May 2051 12.2%1,148,860  KZT/TJS\n\nCorporate loans351,713  April 2026 - December 2040 18.0%239,226  KZT\n\nLoans to SME195,495  April 2026 - November 2032 29.7%28,141  KZT\n\nPurchased retail loans182,130  April 2026 - May 2031 22.6%—  KZT\n\nCar loans167,805  April 2026 - March 2033 25.4%164,930  KZT\n\nRetail loans100,927  April 2026 - July 2045 42.0%5,240  KZT\n\nOther32,335  April 2026 - May 2030\n19.0%/5.2%/ 5.0%\n26 KZT/EUR/USD\n\nAllowance for loans issued(101,799)\n\nTotal loans issued$2,077,606 \n\nThe Group provides mortgage loans to borrowers on behalf of the JSC Kazakhstan Sustainability Fund (\"Program Operator\") related to the state mortgage program \"7-20-25\" and transfers the rights of claim on the mortgage loans to the Program Operator. The proceeds received from these transfers are presented within funds received under state program for financing of mortgage loans in the Consolidated Statements of Cash Flows. Under this program, borrowers can receive a mortgage at an interest rate of 7%, subject to not less than 20% down payment, for 25 years, and the interest payments received by the Group are recognized as interest income in the Group's Consolidated Statements of Operations and Statements of Other Comprehensive Income. In accordance with the program and trust management agreement for the program, Group services the transferred loans and remits all repayments of principal it receives plus 4.5% of the 7% interest received to the Program Operator. The interest paid to the Program Operator is recognized as interest expense in the Consolidated Statements of Operations and Statements of Other Comprehensive Income. The remaining 2.5% of the 7% interest is retained by Group. Under the program and trust management agreement, Group is required to repurchase the rights to make claims on the transferred loans when either loan principal repayments or interest payments are overdue 90 days or more. The repurchase of overdue loans is performed at the loans' nominal value and is presented within repurchase of mortgage loans under the State Program in the Consolidated Statements of Cash Flows.\n\nSince the Group transfers the rights to make claims on the loans with recourse for loans that are more than 90 days past due, retains part of the interest received on the loans and agrees to service the loans after the sale of the loans to the Program Operator, the Group has determined that it retains control over the loans transferred and continues recognizing the loans, which are accounted for as secured borrowings of the Group in accordance with ASC 860, Transfers and Servicing. As the Group continues to recognize the loans as assets, it also recognizes the associated liability equal to the proceeds received from the Program Operator, which is presented separately as liability arising from continuing involvement in the Consolidated Balance Sheets. This liability accrues 5% interest annual as described above. As of March 31, 2026 and March 31, 2025, the corresponding liability amounted to $554,594 and $503,705, respectively.\n\nAs of March 31, 2026 and March 31, 2025, mortgage loans include loans under the state mortgage program \"7-20-25\" with an aggregate principal amount of $568,065 and $511,851, respectively, were presented within loans issued in the Consolidated Balance Sheets.\n\n149\n\n[Table of Contents](#i70ff496d74d2478e8fff6b413c2fcd4c_7)\n\nFREEDOM HOLDING CORP.\n\nNOTES TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS MARCH 31, 2026\n\n(All amounts in thousands of United States dollars, except share data, unless otherwise stated)\n\nThe Group historically entered into agreement with Microfinance Organization Freedom Finance Credit LLP (\"FFIN Credit\"), a company established and controlled by FRHC's controlling shareholder, chairman and chief executive officer, Timur Turlov, to purchase uncollateralized retail loans. FFIN Credit is a non-bank credit institution that issues loans in Kazakhstan under simplified lending procedures. FFIN Credit was created as a pilot project to test and improve the scoring models used for qualifying and issuing loans. The principal operation of FFIN Credit is to provide loans to customers online using biometric identification and its proprietary scoring process. Following the successful pilot, the Company considered either acquire FFIN Credit from Mr. Turlov or implement an in-house solution to replicate its functions, ensuring continuity and scalability of the lending operations.\n\nAlthough the Group obtained legal title to uncollateralized retail loans purchased from FFIN Credit, the Group did not recognize such loans in its consolidated financial statements under U.S. GAAP, as the transactions did not qualify for sale accounting due to contractual provisions under which FFIN Credit retained the credit risk. Accordingly, the Group accounted for these arrangements as financing transactions similar to secured borrowing-type arrangement, recognizing loans receivable from FFIN Credit within loans issued on the Condensed Consolidated Balance Sheets, while the underlying customer loans were treated as collateral.\n\nBeginning in September 2025, the Company begun originating these loans through its banking subsidiary and discontinued the purchase of unsecured consumer loans from FFIN Credit.\n\nDuring the fiscal year ended March 31, 2026, FFIN Credit and the Group agreed that FFIN Credit would make a compensation payment to the Group of approximately $23 million ($20 million discounted), payable over a period of up to two years. In exchange, the Company agreed to release FFIN Credit from the contractual provisions that provided credit protection to the Company covering a total of $215 million of outstanding loans at December 31, 2025. As a result of these modifications, the Group determined that it should recognize the loans previously purchased from FFIN Credit as of December 31, 2025 in the amount of $186 million.\n\nThe total accrued interest for loans issued amounted $20,133 as of March 31, 2026 and $13,385 as of March 31, 2025.\n\nLoans issued as of March 31, 2025, consisted of the following:\n\n Amount OutstandingDue DatesAverage Interest Rate Fair Value of\nCollateralLoan Currency\n\nMortgage loans$924,530 April 2025 - March 205011.4%$924,386 KZT\n\nLoans to SME244,217 April 2025 - February 203228.6%35,141 KZT\n\nRight of claim for purchased retail loans183,635 April 2025 - March 203015.0%183,635 KZT\n\nCar loans156,340 April 2025 - April 203224.2%155,320 KZT\n\nCorporate loans149,143 April 2025 - December 203119.1%92,739 KZT\n\nRetail loans4,847 September 2025 - March 204521.2%663 KZT\n\nOther7,838 April 2025 - September 2029\n18.0%/12.7%/3.0%\n29 \nKZT/EUR\\USD/\n\nAllowance for loans issued(75,115)\n\nTotal loans issued$1,595,435 \n\n150\n\n[Table of Contents](#i70ff496d74d2478e8fff6b413c2fcd4c_7)\n\nFREEDOM HOLDING CORP.\n\nNOTES TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS MARCH 31, 2026\n\n(All amounts in thousands of United States dollars, except share data, unless otherwise stated)\n\nCredit quality indicators\n\nFreedom Bank KZ uses a loan portfolio quality classification system that indicates signs of a significant increase in credit risk and contractual impairment, depending on the analysis of reasonable and supportable information available at the reporting date. The loan portfolio is classified into \"not credit impaired\", \"with significant increase in credit risk\" and \"credit impaired\" agreements.\n\nLoans \"not credit impaired\" under the agreement are serviced as usual, there are no primary signs of an increase in credit risk. Agreements classified as \"with significant increase in credit risk\" represent loans for which there is an increase in the credit risk expected over the life of the agreement compared to the initial risk at the date of recognition of the loan. In practice, the presence of overdue debt on principal and interest for a period of more than 30 days. Agreements classified as \"credit impaired\" represent loans for which at the reporting date there are signs of impairment, the borrower has been in default for 90 or more days for individuals and 60 or more days for legal entities, the borrower for the last 12 months restructured the contract due to the deterioration of the financial condition, the borrower is recognized as credit impaired, the presence of a sign of default, a sign of bankruptcy, the deterioration of the financial performance of the borrower, the presence of other information indicating the presence of a high credit risk.\n\nThe table below presents the Group's loan portfolio by credit quality classification and origination year as of March 31, 2026.\n\n151\n\n[Table of Contents](#i70ff496d74d2478e8fff6b413c2fcd4c_7)\n\nFREEDOM HOLDING CORP.\n\nNOTES TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS MARCH 31, 2026\n\n(All amounts in thousands of United States dollars, except share data, unless otherwise stated)\n\nTerm Loans by Origination Year\n\n20262025202420232022PriorRevolving loansTotal\n\nMortgage loans$291,663 $307,056 $171,398 $352,105 $26,778 $— $— $1,149,000 \n\nthat are not credit impaired290,224 302,323 168,147 348,614 26,374 — — 1,135,682 \n\nwith significant increase in credit risk1,245 2,710 1,860 1,875 243 — — 7,933 \n\nthat are credit impaired194 2,023 1,391 1,616 161 — — 5,385 \n\nCar loans64,088 4,164 78,497 21,056 — — — 167,805 \n\nthat are not credit impaired63,205 4,041 71,901 13,687 — — — 152,834 \n\nwith significant increase in credit risk542 27 1,080 404 — — — 2,053 \n\nthat are credit impaired341 96 5,516 6,965 — — — 12,918 \n\nLoans to SME52,758 59,627 72,382 10,728 — — — 195,495 \n\nthat are not credit impaired49,372 53,303 60,112 8,363 — — — 171,150 \n\nwith significant increase in credit risk1,392 2,258 3,192 506 — — — 7,348 \n\nthat are credit impaired1,994 4,066 9,078 1,859 — — — 16,997 \n\nPurchased retail loans115,550 57,578 8,734 268 — — — 182,130 \n\nthat are not credit impaired105,399 49,929 7,431 223 — — — 162,982 \n\nwith significant increase in credit risk4,771 3,014 514 14 — — — 8,313 \n\nthat are credit impaired5,380 4,635 789 31 — — — 10,835 \n\nCorporate loans310,024 41,594 95 — — — — 351,713 \n\nthat are not credit impaired308,278 41,050 95 — — — — 349,423 \n\nwith significant increase in credit risk647 — — — — — — 647 \n\nthat are credit impaired1,099 544 — — — — — 1,643 \n\nRetail loans97,334 2,853 708 32 — — — 100,927 \n\nthat are not credit impaired95,717 2,409 470 30 — — — 98,626 \n\nwith significant increase in credit risk1,064 93 20 — — — — 1,177 \n\nthat are credit impaired553 351 218 2 — — — 1,124 \n\nOther24,403 258 1,214 6,437 23 — — 32,335 \n\nthat are not credit impaired24,403 258 1,207 6,437 23 — — 32,328 \n\nwith significant increase in credit risk— — — — — — — — \n\nthat are credit impaired— — 7 — — — — 7 \n\nTotal$955,820 $473,130 $333,028 $390,626 $26,801 $— $— $2,179,405 \n\n152\n\n[Table of Contents](#i70ff496d74d2478e8fff6b413c2fcd4c_7)\n\nFREEDOM HOLDING CORP.\n\nNOTES TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS MARCH 31, 2026\n\n(All amounts in thousands of United States dollars, except share data, unless otherwise stated)\n\nThe table below presents the Group's loan portfolio by credit quality classification as of March 31, 2025.\n\nTerm Loans by Origination Fiscal Year\n\n20252024202320222021PriorRevolving loansTotal\n\nMortgage loans$336,535 $186,816 $370,588 $30,591 $— $— $— $924,530 \n\nthat are not credit impaired336,051 184,610 367,918 29,876 — — — 918,455 \n\nwith significant increase in credit risk410 1,361 1,402 340 — — — 3,513 \n\nthat are credit impaired74 845 1,268 375 — — — 2,562 \n\nLoans to SME98,556 126,835 18,826 — — — — 244,217 \n\nthat are not credit impaired96,338 109,461 15,647 — — — — 221,446 \n\nwith significant increase in credit risk1,185 3,612 663 — — — — 5,460 \n\nthat are credit impaired1,033 13,762 2,516 — — — — 17,311 \n\nRight of claim for purchased retail loans151,237 30,702 1,688 8 — — — 183,635 \n\nthat are not credit impaired151,237 30,702 1,688 8 — — — 183,635 \n\nwith significant increase in credit risk— — — — — — — — \n\nthat are credit impaired— — — — — — — — \n\nCar loans5,974 116,459 33,907 — — — — 156,340 \n\nthat are not credit impaired5,974 110,871 26,014 — — — — 142,859 \n\nwith significant increase in credit risk— 1,603 837 — — — — 2,440 \n\nthat are credit impaired— 3,985 7,056 — — — — 11,041 \n\nCorporate loans148,599 470 74 — — — — 149,143 \n\nthat are not credit impaired146,785 470 74 — — — — 147,329 \n\nwith significant increase in credit risk1,813 — — — — — — 1,813 \n\nthat are credit impaired1 — — — — — — 1 \n\nRetail loans3,774 1,066 7 — — — — 4,847 \n\nthat are not credit impaired3,682 887 5 — — — — 4,574 \n\nwith significant increase in credit risk34 18 — — — — — 52 \n\nthat are credit impaired58 161 2 — — — — 221 \n\nOther232 1,237 6,323 46 — — — 7,838 \n\nthat are not credit impaired232 1,229 6,323 46 — — — 7,830 \n\nwith significant increase in credit risk— — — — — — — — \n\nthat are credit impaired— 8 — — — — — 8 \n\nTotal$744,907 $463,585 $431,413 $30,645 $— $— $— $1,670,550 \n\n153\n\n[Table of Contents](#i70ff496d74d2478e8fff6b413c2fcd4c_7)\n\nFREEDOM HOLDING CORP.\n\nNOTES TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS MARCH 31, 2026\n\n(All amounts in thousands of United States dollars, except share data, unless otherwise stated)\n\nAging analysis of past due loans as of March 31, 2026 and March 31, 2025, is as follows:\n\nMarch 31, 2026\n\nLoans 30-59 days past due Loans 60-89 days past due Loans 90 days or more past due and still accruingCurrent loansTotal\n\nMortgage loans5,781 2,152 5,385 1,135,682 1,149,000 \n\nCorporate loans468 179 1,643 349,423 351,713 \n\nLoans to SME3,980 3,368 16,997 171,150 195,495 \n\nPurchased retail loans\n4,348 3,965 10,835 162,982 182,130 \n\nCar loans1,423 630 12,918 152,834 167,805 \n\nRetail loans701 476 1,124 98,626 100,927 \n\nOther— — 7 32,328 32,335 \n\nTotal$16,701 $10,770 $48,909 $2,103,025 $2,179,405 \n\nMarch 31, 2025\n\nLoans 30-59 days past due Loans 60-89 days past due Loans 90 days or more past due and still accruingCurrent loansTotal\n\nMortgage loans$2,835 $678 $2,562 $918,455 924,530 \n\nLoans to SME3,325 2,135 17,311 221,446 244,217 \n\nRight of claim for purchased retail loans— — — 183,635 183,635 \n\nCar loans1,548 892 11,041 142,859 156,340 \n\nCorporate loans730 1,083 1 147,329 149,143 \n\nRetail loans36 16 221 4,574 4,847 \n\nOther— — 8 7,830 7,838 \n\nTotal$8,474 $4,804 $31,144 $1,626,128 $1,670,550 \n\nThe activity in the allowance for credit losses as of March 31, 2026 and March 31, 2025 is summarized in the following tables.\n\n154\n\n[Table of Contents](#i70ff496d74d2478e8fff6b413c2fcd4c_7)\n\nFREEDOM HOLDING CORP.\n\nNOTES TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS MARCH 31, 2026\n\n(All amounts in thousands of United States dollars, except share data, unless otherwise stated)\n\nAllowance for credit losses\n\nMortgage loanLoans to SMECorporate loansRetail loansCar loansPurchased retail loansOtherTotal\n\nMarch 31, 2025\n(10,699)(35,192)(2,640)(761)(8,465)(17,333)(25)$(75,115)\n\nCharges(7,515)(32,115)(6,348)(8,878)(8,238)(33,653)(50)(96,797)\n\nReversals11,064 15,674 3,793 3,544 3,442 22,242 — 59,759 \n\nWrite off40 14,897 — — 253 — — 15,190 \n\nModification— — — — — 908 — 908 \n\nForex(278)(2,016)(352)(478)(828)(1,792)— (5,744)\n\nMarch 31, 2026\n$(7,388)$(38,752)$(5,547)$(6,573)$(13,836)$(29,628)$(75)$(101,799)\n\nAllowance for credit losses\n\nMortgage loanLoans to SMECorporate loansRetail loansCar loansRight of claim for purchased retail loansOtherTotal\n\nMarch 31, 2024\n(3,033)(19,556)(10)(150)(14,262)(6,577)(31)$(43,619)\n\nCharges(10,043)(38,653)(4,191)(754)(5,335)(20,324)(24)(79,324)\n\nReversals1,694 6,757 1,449 96 6,761 8,331 — 25,088 \n\nWrite off1 13,276 — 4 2,914 — 30 16,225 \n\nForex682 2,984 112 43 1,457 1,237 — 6,515 \n\nMarch 31, 2025\n$(10,699)$(35,192)$(2,640)$(761)$(8,465)$(17,333)$(25)$(75,115)\n\n155\n\n[Table of Contents](#i70ff496d74d2478e8fff6b413c2fcd4c_7)\n\nFREEDOM HOLDING CORP.\n\nNOTES TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS MARCH 31, 2026\n\n(All amounts in thousands of United States dollars, except share data, unless otherwise stated)\n\nNOTE 9 - INCOME TAXES\n\nThe Group is subject to taxation in Kazakhstan, Kyrgyzstan, Cyprus, Uzbekistan, Germany, Tajikistan, Türkiye, the United Arab Emirates, the United Kingdom and the United States of America.\n\nThe tax rates used for deferred tax assets and liabilities for the years ended March 31, 2026 and March 31, 2025, were 21% for the United States, 20% for Kazakhstan (with a higher rate of 25% for banking activities), 20% Azerbaijan, 18% for Tajikistan, 10% for Kyrgyzstan, 15% for Germany, 15% for Cyprus, 25% for Türkiye, 25% for United Kingdom, 9% United Arab Emirates, 18% for Armenia and 15% for Uzbekistan.\n\nAs of March 31, 2026 and March 31, 2025, deferred tax assets and liabilities of the Company were comprised of the following:\n\nYear ended March 31, 2026\nYear ended March 31, 2025\n\nDeferred tax assets:\n\nProvisions for contingent liabilities$2,100 $— \n\nTax losses carryforward21,479 4,871 \n\nDeferred acquisition costs and insurance reserves27,204 6,669 \n\nProvision for impairment losses19,510 12,181 \n\nValuation allowance on unrecognized deferred tax assets(27,575)— \n\nDeferred tax assets$42,718 $23,721 \n\nDeferred tax liabilities:\n\nRevaluation on trading securities$5,107 $874 \n\nFixed and Intangible Assets7,980 4,425 \n\nOther liabilities— 1,038 \n\nDeferred tax liabilities$13,087 $6,337 \n\nNet deferred tax assets$36,183 $17,446 \n\nNet deferred tax liabilities$6,552 $62 \n\n156\n\n[Table of Contents](#i70ff496d74d2478e8fff6b413c2fcd4c_7)\n\nFREEDOM HOLDING CORP.\n\nNOTES TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS MARCH 31, 2026\n\n(All amounts in thousands of United States dollars, except share data, unless otherwise stated)\n\nThe Company is subject to the U.S. federal income taxes at a rate of 21%. The reconciliation of the amount computed by multiplying income before provision for income taxes at the 21% income tax rate compared to the Company's income tax expense as reported is as follows:\n\n Year ended March 31, 2026Year ended March 31, 2025Year ended March 31, 2024\n\n \n\nIncome before income tax at 21%$47,453 $23,719 $91,428 \n\nEffect of cross-border tax laws\n\nGlobal Intangible Low Taxed Income103,741 65,308 60,323 \n\nSubpart F Income4,164 4,750 6,887 \n\nForeign tax effects\n\nKazakhstan\n\nNontaxable gains and interest(31,787)(16,154)(108,025)\n\nCommission income(28,639)(27,592)(20,980)\n\nForeign tax rate differential(1,394)165 (3,460)\n\nAdditional 10% tax20,901 — — \n\nCyprus\n\nForeign tax rate differential(21,952)(19,239)(14,492)\n\nNontaxable gains and interest(1,326)(42)(108)\n\nTop-up tax10,226 3,743 — \n\nOther foreign jurisdictions\n\nForeign tax rate differential681 129 287 \n\nNontaxable or nondeductible items\n\nStock based compensation13,445 10,597 4,601 \n\nOther permanent differences24,282 4,159 58,873 \n\nValuation Allowance(27,575)— — \n\nTax Credits\n\nForeign tax credit(39,583)(21,118)(14,915)\n\nIncome tax expense$72,637 $28,425 $60,419 \n\nAs of March 31, 2026 and 2023, income tax expense was comprised of the following:\n\n Year ended March 31, 2026Year ended March 31, 2025Year ended March 31, 2024\n\nCurrent income tax charge\n\nFederal922 4,054 34,623 \n\nForeign84,093 44,341 24,573 \n\n85,015 48,395 59,196 \n\nDeferred income tax charge\n\nFederal(17,268)(12,715)3,695 \n\nForeign4,890 (7,255)(2,472)\n\n(12,378)(19,970)1,223 \n\nIncome tax expense$72,637 $28,425 $60,419 \n\nDuring the years ended March 31, 2026, March 31, 2025 and March 31, 2024, the Company realized net income before income tax $225,965, $104,583 and $438,938, respectively. During the same periods, the Company's effective tax rate was\n\n157\n\n[Table of Contents](#i70ff496d74d2478e8fff6b413c2fcd4c_7)\n\nFREEDOM HOLDING CORP.\n\nNOTES TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS MARCH 31, 2026\n\n(All amounts in thousands of United States dollars, except share data, unless otherwise stated)\n\nequal to 32.1%, 27.2% and 13.8%, respectively. Tax years ended from March 31, 2026 to March 31, 2022 are remains subject to examination by major tax jurisdictions.\n\nIncome before income taxes includes the following components:\n\n Year ended March 31, 2026Year ended March 31, 2025Year ended March 31, 2024\n\nUnited States$(134,094)$(61,060)$(66,053)\n\nForeign360,059 165,643 504,991 \n\nNet income before income tax$225,965 $104,583 $438,938 \n\nAs of March 31, 2026, the Company had undistributed earnings of certain foreign subsidiaries of $857,837. The Company intends to reinvest its foreign earnings indefinitely in the non-U.S. operations and therefore has not provided for any non-U.S. withholding tax that would be assessed on dividend distributions. The determination of the U.S. state income taxes upon a potential foreign earnings distribution is impractical. In the event the earnings were distributed to the U.S., the Company would adjust its income tax provision for the period and would determine the amount of foreign tax credit that would be available.\n\nIncome taxes paid disaggregated by federal and foreign for the years ended March 31, 2026, March 31, 2025 and March 31, 2024 were as follows:\n\n Year ended March 31, 2026Year ended March 31, 2025Year ended March 31, 2024\n\nUS Federal$2,110 $24,996 $15,022 \n\nForeign79,190 28,926 15,297 \n\nIncome taxes paid:$81,300 $53,922 $30,319 \n\nIncome taxes paid disaggregated by individual jurisdiction for the years ended March 31, 2026, March 31, 2025 and March 31, 2024, were as follows:\n\n Year ended March 31, 2026Year ended March 31, 2025Year ended March 31, 2024\n\nUnited states$2,110 $24,996 $15,022 \n\nKazakhstan29,560 2,937 — \n\nCyprus37,414 24,785 15,297 \n\nArmenia12,216 1,204 — \n\nIncome taxes paid:$81,300 $53,922 $30,319 \n\nTax loss carryforwards as of March 31, 2026 and March 31, 2025, was $107,792 and $27,280, respectively, in Cyprus and Kazakhstan.\n\nOn July 15 and 18, 2025, the President of the Republic of Kazakhstan signed the Law on Amendments to the current Tax Code of the Republic of Kazakhstan, as well as the new Tax Code of the Republic of Kazakhstan, which came into effect starting from January 1, 2026.\n\nThe amendments related to the current tax code of Kazakhstan, is effective for the period starting from January 1, 2025 until December 31, 2025, and concerns the procedures and deadlines for filing individual tax returns. There will also be, for 2025 only, an additional 10% applied to the corporate income tax rate on certain types of income, including net income from debt securities issued by Ministry of Finance of Kazakhstan, income from short-term deposits with the National Bank of Kazakhstan (the \"NBK\"), net income from swaps with maturities of up to one year, and net interest income from direct\n\n158\n\n[Table of Contents](#i70ff496d74d2478e8fff6b413c2fcd4c_7)\n\nFREEDOM HOLDING CORP.\n\nNOTES TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS MARCH 31, 2026\n\n(All amounts in thousands of United States dollars, except share data, unless otherwise stated)\n\nand reverse REPO transactions. As a result of this change, the Company's Kazakhstani subsidiaries have incurred additional income tax expense in the amount of $20,901 for the year ended March 31, 2026. The details are presented in the table below:\n\nTax effect at Kazakhstani subsidiaries\n20,901 \n\nForeign tax credit used for GILTI and Subpart F Income taxes\n(4,690)\n\nForeign tax credit used for Pillar II\n(12,649)\n\nIncome tax expense effect, net of foreign tax credits\n3,562 \n\nIncome before income tax expenses for the year ended March 31, 2026225,965 \n\nEffect on the consolidated effective tax rate\n1.58 %\n\nThe new Tax Code of Kazakhstan, effective from January 1, 2026, is mainly aimed at reducing the volume of tax exemptions and transitioning to differentiated tax rates across various sectors of the economy. The new Tax Code provides for an increase in the corporate income tax rate for the banking sector to 25%, except for income from business lending, the elimination of VAT exemptions on certain financial operations, and an increase in the VAT rate to 16%. Income from government securities will be partially tax exempted from taxable income with a limit up to 50% from total income from government securities.\n\nOn July 4, 2025, US President Trump signed into law the legislation commonly referred to as the One Big Beautiful Bill Act (“OBBBA”). The OBBBA includes various provisions, such as the permanent extension of certain expiring provisions of the Tax Cuts and Jobs Act, modifications to the international tax framework and the restoration of favorable tax treatment for certain business provisions. The OBBBA has multiple effective dates, with certain provisions effective from April 1, 2026 and others implemented through 2027.\n\nNOTE 10 - FIXED ASSETS, NET\n\nAs of March 31, 2026 and 2025, fixed assets, net of the Company included the following:\n\nMarch 31, 2026March 31, 2025\n\nConstruction in progress$126,487 $40,002 \n\nProcessing and storage data centers63,094 21,848 \n\nBuildings53,537 36,270 \n\nOffice equipment52,927 29,293 \n\nTelecommunications network infrastructure33,146 37,663 \n\nVehicles22,132 9,021 \n\nCapital expenditures on leasehold improvements18,745 12,789 \n\nLand18,246 11,820 \n\nFurniture11,731 12,045 \n\nOther17,950 5,584 \n\nLess: Accumulated depreciation(59,599)(25,232)\n\nTotal fixed assets, net$358,396 $191,103 \n\nDepreciation expense totaled $26,368, $12,138 and $6,806 for the years ended March 31, 2026, 2025 and 2024, respectively.\n\nDuring the year ended March 31, 2026, the Company's additions to fixed assets were primarily driven by continued investments in telecommunications network infrastructure, processing and storage data center infrastructure, and expansion\n\n159\n\n[Table of Contents](#i70ff496d74d2478e8fff6b413c2fcd4c_7)\n\nFREEDOM HOLDING CORP.\n\nNOTES TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS MARCH 31, 2026\n\n(All amounts in thousands of United States dollars, except share data, unless otherwise stated)\n\nof operating premises and equipment to support the growth of the Company's digital ecosystem and related businesses. Investments in telecommunications network infrastructure principally consisted of the installation and expansion of fiber-optic communication lines and related supporting equipment, which are recorded within construction in progress until the related assets are placed into service, at which point they are reclassified to telecommunications network infrastructure. Accordingly, the most significant additions during the year were reflected within construction in progress and processing and storage data center infrastructure.\n\nConstruction in progress as of March 31, 2026 and March 31, 2025, was $126.5 million and $40.0 million, respectively, and primarily consists of costs incurred in connection with the installation of fiber-optic communication lines, including construction services, labor, travel, and materials, which will be capitalized upon project completion and placement into service.\n\nTelecommunications network infrastructure consists primarily of fiber-optic communication lines and related supporting equipment.\n\nNOTE 11 - INTANGIBLE ASSETS, NET\n\nAs of March 31, 2026 and 2025, intangible assets, net of the Company included the following:\n\nMarch 31, 2026March 31, 2025\n\nWeighted-Average LifeGross Carrying AmountAccumulated AmortizationGross Carrying AmountAccumulated Amortization\n\nAmortized intangible assets\n\n Software 20$42,841 $(7,949)$22,945 $(5,010)\n\n Trademark\nindefinite/3\n19,549 (1,836)18,596 — \n\n Licenses 2114,111 (2,171)10,645 (1,705)\n\n Customer base 68,166 (4,992)9,225 (4,284)\n\n Value added business 475,182 (3,479)4,114 (2,161)\n\n Other intangible assets 124,558 (661)2,766 (945)\n\nTotal $94,407 $(21,088)$68,291 $(14,105)\n\nTotal intangible assets, net$73,319 $54,186 \n\nAggregate Amortization Expense\n\nFor year ended 31.03.2026$8,192 \n\nEstimated Amortization Expense\n\nFor year ended 31.03.2027$7,568 \n\nFor year ended 31.03.2028$7,019 \n\nFor year ended 31.03.2029$6,731 \n\nFor year ended 31.03.2030$6,405 \n\nFor year ended 31.03.2031$6,359 \n\nAmortization expense totaled $8,192, $5,020 and $7,797 for the years ended March 31, 2026, 2025 and 2024 respectively.\n\n160\n\n[Table of Contents](#i70ff496d74d2478e8fff6b413c2fcd4c_7)\n\nFREEDOM HOLDING CORP.\n\nNOTES TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS MARCH 31, 2026\n\n(All amounts in thousands of United States dollars, except share data, unless otherwise stated)\n\nNOTE 12 - OTHER ASSETS, NET\n\nAs of March 31, 2026 and 2025, other assets, net of the Company included the following:\n\nMarch 31, 2026March 31, 2025\n\nAdvances paid$70,023 $19,550 \n\nPrepaid expenses38,634 37,047 \n\nDeferred tax assets36,183 17,446 \n\nPrepayments on acquisition29,524 22,407 \n\nTaxes other than income taxes26,812 11,710 \n\nInventory17,623 6,402 \n\nCurrent income tax asset20,983 2,886 \n\nDeferred acquisition costs7,443 40,130 \n\nInvestments in joint ventures and associated companies3,385 3,877 \n\nOther14,233 8,189 \n\nTotal other assets264,843 169,644 \n\nAllowance for other assets (222)(3)\n\nOther assets, net$264,621 $169,641 \n\nAs of March 31, 2026 and 2025, advances paid amounted to $70,023 and $19,550, respectively. As of March 31, 2026, advances paid primarily included prepayments related to construction and installation services, as well as purchases of equipment under contracts entered by Freedom Telecom and its subsidiaries.\n\nNOTE 13 - SECURITIES REPURCHASE AGREEMENT OBLIGATIONS\n\nAs of March 31, 2026 and 2025, trading securities included collateralized securities subject to repurchase agreements as described in the following table:\n\n March 31, 2026\n\n Interest rates and remaining contractual maturity of the agreements\n\n Average\ninterest rateUp to\n30 days30-90\ndaysTotal\n\n \n\nSecurities sold under repurchase agreements\n\nNon-US sovereign debt17.87 %$798,130 $— $798,130 \n\nCorporate debt17.78 %183,577 42,205 225,782 \n\nCorporate equity16.25 %1,011 — 1,011 \n\nTotal securities sold under repurchase agreements $982,718 $42,205 $1,024,923 \n\n161\n\n[Table of Contents](#i70ff496d74d2478e8fff6b413c2fcd4c_7)\n\nFREEDOM HOLDING CORP.\n\nNOTES TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS MARCH 31, 2026\n\n(All amounts in thousands of United States dollars, except share data, unless otherwise stated)\n\nMarch 31, 2025\n\nInterest rates and remaining contractual maturity of the agreements\n\nAverage\ninterest rateUp to 30\ndays30-90\ndaysTotal\n\nSecurities sold under repurchase agreements\n\nNon-US sovereign debt15.74 %$904,940 $2,364 $907,304 \n\nCorporate debt15.95 %423,572 87,120 510,692 \n\nCorporate equity3.25 %447 — 447 \n\nTotal securities sold under repurchase agreements$1,328,959 $89,484 $1,418,443 \n\nThe fair value of collateral pledged under repurchase agreements as of March 31, 2026 and 2025, was $1,023,223 and $1,436,271, respectively.\n\nSecurities pledged as collateral by the Group under repurchase agreements are liquid trading securities with market quotes and significant trading volume.\n\nAs of March 31, 2026 and 2025, securities repurchase agreement obligations included accrued interest in the amount of $3,453 and $4,798, with a weighted average maturity of 6 days and 10 days, respectively. All securities repurchase agreements transactions were executed through the Kazakhstan Stock Exchange.\n\nNOTE 14 - CUSTOMER LIABILITIES\n\nThe Group recognizes customer liabilities associated with deposit funds of its brokerage and bank customers. As of March 31, 2026, and March 31, 2025, customer liabilities consisted of:\n\nMarch 31, 2026March 31, 2025\n\nAmountInterest rateAmountInterest rate\n\nInterest-bearing deposits:\n\nTerm deposits$2,522,760 \n0.04% -19.4%\n$1,722,313 \n0.05%-18.3%\n\nTotal Interest-bearing deposits$2,522,760 $1,722,313 \n\nNon-interest-bearing accounts:\n\nBrokerage customers$3,998,521 $2,167,111 \n\nCustomer accounts582,703 415,575 \n\nTotal non-interest-bearing accounts\n$4,581,224 $2,582,686 \n\nTotal customer liabilities$7,103,984 $4,304,999 \n\nIn accordance with Kazakhstan law requirements, commercial banks conclude agreements with JSC Kazakhstan Deposit Insurance Fund (\"KDIF\"), under which banks are required to pay commissions to KDIF on a recurring basis, the amount of which depends on the term deposits and demand deposits received by banks from their customers. Under the agreement, KDIF insures the term deposits and demand deposits up to $42 for each customer. As at March 31, 2026 and March 31, 2025, respectively, the Group had total amounts in excess of insured bank term deposits of $819,475 and $669,753 for all customers.\n\nAs of March 31, 2026, and March 31, 2025, the Group had customer liabilities to a single non-related party that individually exceeded 10% of the Group’s total customer liabilities in the amount of $2,368,911 and $731,363, respectively.\n\n162\n\n[Table of Contents](#i70ff496d74d2478e8fff6b413c2fcd4c_7)\n\nFREEDOM HOLDING CORP.\n\nNOTES TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS MARCH 31, 2026\n\n(All amounts in thousands of United States dollars, except share data, unless otherwise stated)\n\nNOTE 15 - MARGIN LENDING AND TRADE PAYABLES\n\nAs of March 31, 2026 and 2025, margin lending and trade payables of the Group were comprised of the following:\n\nMarch 31, 2026March 31, 2025\n\nMargin lending payable$625,136 $1,290,569 \n\nPayables to suppliers of goods and services45,634 20,096 \n\nPayables to merchants10,400 5,982 \n\nOther8,471 5,594 \n\nTotal margin lending and trade payables$689,641 $1,322,241 \n\nThe fair value of collateral by the Group under margin loans as of March 31, 2026, and 2025 was $1,550,344 and $4,521,411, respectively.\n\n163\n\n[Table of Contents](#i70ff496d74d2478e8fff6b413c2fcd4c_7)\n\nFREEDOM HOLDING CORP.\n\nNOTES TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS MARCH 31, 2026\n\n(All amounts in thousands of United States dollars, except share data, unless otherwise stated)\n\nNOTE 16 - DEBT SECURITIES ISSUED\n\nAs of March 31, 2026 and 2025, outstanding debt securities of the Group included the following:\n\nDebt securities issued by:\n\nPrincipal Amount as of March 31, 2026\n\nPrincipal Amount as of March 31, 2025\nInterest rateIssue dateMaturity dateDenominated Currency\n\nFreedom SPC bonds due 2028$269,722 $— \n9.5%\nOctober, 2025October, 2028\nUSD\n\nFreedom SPC bonds due 2028200,170 200,305 \n1-2 years: 12%\n\n3-5years: 10.39%\nDecember, 2023December, 2028\nUSD\n\nFreedom SPC bonds due 2026199,344 201,311 \n10.5%\nSeptember, 2024September, 2026\nUSD\n\nFreedom SPC bonds due 2027198,492 — \n10.0%\nMay, 2025May, 2027\nUSD\n\nFreedom SPC bonds due 2029186,502 — \n9.0%\nMarch, 2026March, 2029\nUSD\n\nFreedom SPC bonds due 202798,982 — \n8.0%\nMay, 2025May, 2027\nEUR\n\nFreedom SPC bonds due 202665,057 64,801 \n 5.5%\nOctober, 2021October, 2026\nUSD\n\nFreedom SPC bonds due 202730,676 — \n9.0%\nMay, 2025May, 2027\nCNY\n\nAccrued interest12,175 3,134 \n\nTotal debt securities issued$1,261,120 $469,551 \n\nThe Freedom SPC bonds are denominated in U.S. dollars, euros, Chinese yuans and were issued under Astana International Financial Centre (\"AIFC\") law and trade on the AIX. FRHC is a guarantor of the Freedom SPC bonds.\n\nThe Freedom SPC bonds due 2026 bear interest at an annual rate of 5.5% and 10.5%. The maturity dates for those bonds are in October and September 2026. Interest payments are due to be made semi-annually in April and October, and on a quarterly basis.\n\nFor the first two years of Freedom SPC bonds due 2028, the annual interest rate is 12.0% and for subsequent (third, fourth and fifth) years the interest rate is stated to be fixed and set as the sum of Effective Federal Funds Rate (EFFR) as of December 10, 2025 and a margin of 6.5%. The annual interest rate for subsequent (third, fourth and fifth) years has been determined at 10.39%. Interest is paid on a monthly basis. The bondholders have a right of early redemption after two years at nominal value plus accrued interest. After two years, following the issue date, the issuer has the option to redeem the bonds in full or in part at nominal value plus accrued interest.\n\nThe Freedom SPC bonds due 2027 bear interest at an annual rate of 8%, 9% and 10% and maturity date in May 2027. Interest is paid on a quarterly basis. The Freedom SPC bonds due 2028 bear interest at an annual rate of 9.5% and maturity date in October 2028. Interest is paid on a quarterly basis. The Freedom SPC bonds due 2029 bear interest at an annual rate of 9.0% and maturity date in March 2029. Interest is paid on a quarterly basis.\n\nDebt securities issued are initially recognized at the fair value of the consideration received, less directly attributable transaction costs.\n\nThe Group has no financial covenants to comply with under the terms of its debt securities.\n\n164\n\n[Table of Contents](#i70ff496d74d2478e8fff6b413c2fcd4c_7)\n\nFREEDOM HOLDING CORP.\n\nNOTES TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS MARCH 31, 2026\n\n(All amounts in thousands of United States dollars, except share data, unless otherwise stated)\n\nNOTE 17 - INSURANCE CONTRACTS ASSETS AND LIABILITIES FROM INSURANCE ACTIVITIES\n\nAs of March 31, 2026, and March 31, 2025, the Company recognized insurance-related assets and liabilities arising from its underwriting and reinsurance activities. Effective April 1, 2025, the Company adopted LDTI (ASU 2018-12) using the modified retrospective transition method; the accounting policy change and transition impact are described in Note 2. The comparative balances as of March 31, 2025 have been recasted to reflect the disaggregated presentation required by LDTI.\n\nThe disclosures below relate solely to the Company's insurance operations and not to its other operating segments (Banking, Brokerage, and Other).\n\nNature of Insurance Products\n\nThe Company offers the following insurance products:\n\n- Long-Duration Contracts: Life insurance and annuity contracts\n\n- Short-Duration Contracts: Life insurance, general insurance products, including property (including automobile),\n\naccident, casualty, and civil liability lines, compulsory employer liability insurance\n\nAs of March 31, 2026, and March 31, 2025, insurance and reinsurance receivables of the Group were comprised of the following:\n\nInsurance contract assets\n\nMarch 31, 2026\n\nMarch 31, 2025 (Recasted)\n\nAssets:\n\nAmounts due from policyholders$9,802 $15,197 \n\nAmounts due from reinsured7,782 5,583 \n\nAdvances paid for reinsurance\n2,890 5,364 \n\nClaims receivable from reinsurance25,235 3,023 \n\nLess: provision for impairment losses(17,595)(2,432)\n\nInsurance and reinsurance receivables:28,114 26,735 \n\nUnearned premium reserve, reinsurers' share\n3,790 7,028 \n\nReserves for claims and claims' adjustment expenses, reinsurers' share - short-duration4,945 3,420 \n\nTotal$36,849 $37,183 \n\nDeferred acquisition costs - long-duration contracts$1,266 $1,100 \n\n165\n\n[Table of Contents](#i70ff496d74d2478e8fff6b413c2fcd4c_7)\n\nFREEDOM HOLDING CORP.\n\nNOTES TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS MARCH 31, 2026\n\n(All amounts in thousands of United States dollars, except share data, unless otherwise stated)\n\nAs of March 31, 2026, and March 31, 2025, insurance and reinsurance payables of the Company was comprised of the following:\n\nInsurance contract liabilities\n\nMarch 31, 2026\n\nMarch 31, 2025 (Recasted)\n\nLiabilities:\n\nAmounts payable to insured\n$5,058 9,417 \n\nAmounts payable to agents and brokers334 6,287 \n\nAmounts payable to reinsurers\n2,248 1,669 \n\nInsurance and reinsurance payables7,640 17,373 \n\nUnearned premium reserve95,573 87,194 \n\nReserves for claims and claims' adjustment expenses - short-duration58,463 84,023 \n\nLiability for future policy benefits328,288 211,384 \n\nDeferred profit liability163,943 72,459 \n\nTotal$653,907 $472,433 \n\nLong-Duration Contracts\n\nThe Long-Duration Contracts represents the net present value of expected future benefit outflows less expected future net premium inflows for the Company's long-duration contracts, measured under ASC 944-40 as amended by LDTI. Measurement methodology is described in Note 2.\n\nRollforward Table\n\nThe table below presents the Long-Duration Contracts disaggregated into the present value of expected net premiums (\"PVENP\") and the present value of expected future policy benefits (\"PVEFPB\"). The net LFPB equals PVEFPB minus PVENP. All amounts are net of reinsurance.\n\nLiability for Future Policy Benefits — Rollforward\nMarch 31, 2026\n\nMarch 31, 2025 (Recasted)\n\nPresent Value of Expected Net Premiums (PVENP)\n\nBalance, beginning of period$4,787 $4,520 \n\nEffect of discount rate change (to OCI)187 (328)\n\nEffect of cash flow assumption changes(377)149 \n\nEffect of actual vs. expected experience297 618 \n\nInterest accrual 558 449 \n\nIssuance expense129,511 129,231 \n\nNet premiums collected(130,230)(129,303)\n\nEffect of foreign currency translation252 (549)\n\nBalance, end of period$4,985 $4,787 \n\n166\n\n[Table of Contents](#i70ff496d74d2478e8fff6b413c2fcd4c_7)\n\nFREEDOM HOLDING CORP.\n\nNOTES TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS MARCH 31, 2026\n\n(All amounts in thousands of United States dollars, except share data, unless otherwise stated)\n\nLiability for Future Policy Benefits — Rollforward\nMarch 31, 2026\n\nMarch 31, 2025 (Recasted)\n\nPresent Value of Expected Future Policy Benefits (PVEFPB)\n\nBalance, beginning of period$216,171 $128,973 \n\nEffect of discount rate change (to OCI)1,068 (7,135)\n\nEffect of cash flow assumption changes(1,872)888 \n\nEffect of actual vs. expected experience28,571 18,665 \n\nInterest accrual24,166 9,786 \n\nIssuance expense131,127 129,731 \n\nBenefit payments(34,997)(11,480)\n\nSurrender / termination payments(50,563)(34,237)\n\nEffect of foreign currency translation19,602 (19,020)\n\nBalance, end of period$333,273 $216,171 \n\nLiability for Future Policy Benefits, net$328,288 $211,384 \n\nLife Insurance\n\nMarch 31, 2026March 31, 2025 (Recasted)\n\nUndiscounted PVEFPB40,62636,616\n\nUndiscounted PVENP8,0837,913\n\nDiscounted PVEFPB18,77618,460\n\nDiscounted PVENP4,9854,787\n\nWeighted-average duration of the liability (years)5.55.1\n\nWeighted-average interest accretion (original locked-in) rate in KZT12 %11 %\n\nWeighted-average current discount rate at balance sheet date in KZT14 %13 %\n\nAnnuity contracts\n\nMarch 31, 2026March 31, 2025 (Recasted)\n\nUndiscounted PVEFPB726,403409,097\n\nUndiscounted PVENP— — \n\nDiscounted PVEFPB314,350197,599\n\nDiscounted PVENP— — \n\nWeighted-average duration of the liability (years)3.12.9\n\nWeighted-average interest accretion (original locked-in) rate14 %11 %\n\nWeighted-average current discount rate at balance sheet date15 %13 %\n\nKey Actuarial Assumptions\n\nThe reserve for long‑duration insurance contracts is measured using best‑estimate cash flow assumptions without any provision for adverse deviation, in accordance with ASC 944‑40‑30‑7. The significant assumptions include mortality rates, lapse rates, policy maintenance expenses, and the discount rate.\n\n167\n\n[Table of Contents](#i70ff496d74d2478e8fff6b413c2fcd4c_7)\n\nFREEDOM HOLDING CORP.\n\nNOTES TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS MARCH 31, 2026\n\n(All amounts in thousands of United States dollars, except share data, unless otherwise stated)\n\n•Mortality assumptions for retirement annuity products and employer liability annuities are based on local mortality tables established by the regulatory framework of the Republic of Kazakhstan, while for other portfolios they are based on the reinsurer’s mortality tables.\n\n•Lapse rates are determined based on the Company’s historical experience, analyzed by portfolio and policy duration.\n\n•Policy maintenance expenses reflect the current level of per‑policy costs, adjusted for the expected rate of inflation.\n\n•Discount curves for KZT‑denominated liabilities are derived using the parametric Nelson–Siegel curve with parameters published by KASE, while discount curves for USD‑denominated liabilities are based on the HQMYC discount curve from the FED.\n\n•Cash‑flow assumptions are reviewed at least annually, and the results of such reviews are recognized in net income in the period in which the review is performed.\n\nDeferred Acquisition Costs — Long-Duration Contracts\n\nThe following table presents the rollforward of DAC attributable to long-duration contracts. Effective April 1, 2025, DAC is amortized on a straight-line basis over the expected contract term. DAC attributable to short-duration contracts continues to be amortized over the one-year policy period and is not presented separately.\n\nDeferred Acquisition Costs — Long-Duration Contracts\nMarch 31, 2026\n\nMarch 31, 2025 (Recasted)\n\nBalance, beginning of period$1,100 $1,210 \n\nCapitalizations — new business written499 456 \n\nAmortization (straight-line, contract term)(170)(219)\n\nImpairment / write-off(229)(209)\n\nForeign currency translation66 (138)\n\nBalance, end of period$1,266 $1,100 \n\nPrior to LDTI adoption, DAC on traditional life contracts was amortized over the premium-paying period using the net level premium method; DAC on participating and interest-sensitive contracts was amortized on the basis of estimated gross profits (EGP). The transition to straight-line amortization has been reflected in the opening balance adjustment described in Note 2.\n\nShort-Duration Contracts\n\nRollforward Table\n\n    \n\n168\n\n[Table of Contents](#i70ff496d74d2478e8fff6b413c2fcd4c_7)\n\nFREEDOM HOLDING CORP.\n\nNOTES TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS MARCH 31, 2026\n\n(All amounts in thousands of United States dollars, except share data, unless otherwise stated)\n\nMarch 31, 2026\n\nMarch 31, 2025 (Recasted)\n\nGross reserves, beginning of year$84,023 $55,678 \n\nLess: reinsurers' share, beginning of year(3,420)(4,031)\n\nNet reserves, beginning of year80,603 51,647 \n\nClaims and CAE Incurred:\n\nCurrent year80,105 80,473 \n\nPrior years — (favorable) / adverse(23,661)(14,437)\n\nTotal incurred56,444 66,036 \n\nClaims and CAE Paid:\n\nCurrent year(74,206)(23,350)\n\nPrior years(11,257)(6,363)\n\nTotal paid(85,463)(29,713)\n\nForeign exchange effect1,936 (7,367)\n\nNet reserves, end of year53,520 80,603 \n\nPlus: reinsurers' share, end of year4,943 3,420 \n\nGross reserves, end of year$58,463 $84,023 \n\nThe decrease in incurred claims and claim adjustment expenses attributable to prior fiscal years primarily reflects favorable development in the Insurance of Vehicle Owners line, driven by lower-than-expected claim frequency for those prior accident years, and lower incurred claims in the Accident Insurance line. Lower incurred claims in the Accident Insurance line were primarily driven by lower sales volumes in this line of business following changes in local regulatory requirements. No material assumption changes or premium adjustments were recorded as a result.\n\nAllocation by Short-Duration Product Line\n\nAs of March 31, 2026\n\nGross reserves for claims and claims’ adjustment expensesReserves for claims and claims’ adjustment expenses, reinsurers’ shareReserves for claims and claims’ adjustment expenses, net of reinsurance\n\nLife Insurance$4,631 $22 $4,609 \n\nAccident Insurance438 — 438 \n\nCivil Liability\n8,367 339 8,028 \n\nVehicle Owners\n14,030 — 14,030 \n\nCompulsory employer liability insurance\n8,189 491 7,698 \n\nProperty Damage\n4,987 454 4,533 \n\nMotor Vehicle\n2,431 22 2,409 \n\nOther11,775 \n\nTotal\n$53,520 \n\n169\n\n[Table of Contents](#i70ff496d74d2478e8fff6b413c2fcd4c_7)\n\nFREEDOM HOLDING CORP.\n\nNOTES TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS MARCH 31, 2026\n\n(All amounts in thousands of United States dollars, except share data, unless otherwise stated)\n\nClaims Development - Short-Duration Contracts\n\nLife Insurance\n\nIncurred losses and LAE, net of reinsurance for the years ended March 31\n\nAccident\nThe information about incurred and paid claims development for the years ended March 31, 2018 to 2025, is presented as supplementary information.\n\nYear\n201820192020202120222023202420252026\n\n20186 11 — — — — — — — \n\n2019122 38 — — — — — — \n\n202052 22 1 1 1 1 1 \n\n20218 2 — — — — \n\n2022106 211 203 25 — \n\n2023552 3,532 1,118 3 \n\n202414,334 6,857 99 \n\n202524,966 64 \n\n20264,738 \n\nTotal\n4,905 \n\nCumulative paid losses and LAE, net of reinsurance\n\n2018— — — — — — — — — \n\n2019— — — — — — — — \n\n20201 1 1 1 1 1 1 \n\n2021— — — — — — \n\n2022— — — — — \n\n20231 3 3 24 \n\n202473 98 128 \n\n202560 84 \n\n202659 \n\nTotal\n296 \n\nLiabilities for loss and LAE, net of reinsurance\n4,609 \n\nThe following table shows the average annual percentage payout of incurred losses for the Life Insurance line of business:\n\nAverage annual percentage payout of incurred losses by age, net of reinsurance (unaudited)\n\nYears\n123456789\n\nAverage annual percentage payout\n50.8%32.1%(4.4)%204.9%(233.5)%—%50.0%—%—%\n\n170\n\n[Table of Contents](#i70ff496d74d2478e8fff6b413c2fcd4c_7)\n\nFREEDOM HOLDING CORP.\n\nNOTES TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS MARCH 31, 2026\n\n(All amounts in thousands of United States dollars, except share data, unless otherwise stated)\n\nAccident Insurance\n\nIncurred losses and LAE, net of reinsurance for the years ended March 31\n\nAccidentThe information about incurred and paid claims development for the years ended March 31, 2018 to 2025, is presented as supplementary information.\n\nYear201820192020202120222023202420252026\n\n20182 4 — — — — — — — \n\n2019106 38 1 1 1 1 1 1 \n\n202085 95 1 1 1 1 1 \n\n2021261 195 1 1 1 1 \n\n2022426 243 4 4 4 \n\n2023833 678 11 119 \n\n20242,125 3,610 56 \n\n20259,608 274 \n\n2026227 \n\nTotal683 \n\nCumulative paid losses and LAE, net of reinsurance\n\n2018— — — — — — — — — \n\n2019— 1 1 1 1 1 1 1 \n\n2020— 1 1 1 1 1 1 \n\n20211 1 1 1 1 1 \n\n20222 4 4 4 4 \n\n20235 11 11 11 \n\n202432 37 39 \n\n2025184 187 \n\n20261 \n\nTotal245 \n\nLiabilities for loss and LAE, net of reinsurance438 \n\nThe following table shows the average annual percentage payout of incurred losses for the Accident Insurance line of business:\n\nAverage annual percentage payout of incurred losses by age, net of reinsurance (unaudited)\n\nYears\n123456789\n\nAverage annual percentage payout\n37.2%41.3%2.2%2.3%18.6%0.3%(1.9)%—%—%\n\n171\n\n[Table of Contents](#i70ff496d74d2478e8fff6b413c2fcd4c_7)\n\nFREEDOM HOLDING CORP.\n\nNOTES TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS MARCH 31, 2026\n\n(All amounts in thousands of United States dollars, except share data, unless otherwise stated)\n\nCivil Liability\n\nIncurred losses and LAE, net of reinsurance for the years ended March 31\n\nAccidentThe information about incurred and paid claims development for the years ended March 31, 2018 to 2025, is presented as supplementary information.\n\nYear201820192020202120222023202420252026\n\n20181 1 1 1 1 — 1 1 1 \n\n2019— 27 9 — — — — — \n\n20202 2 2 — — — — \n\n202112 12 36 232 2 2 \n\n2022754 727 678 766 832 \n\n2023254 1,006 610 135 \n\n20242,971 3,106 2,240 \n\n20258,041 4,746 \n\n20263,722 \n\nTotal11,678 \n\nCumulative paid losses and LAE, net of reinsurance\n\n20181 1 1 1 1 1 1 1 1 \n\n2019— — — — — — — — \n\n2020— — — — — — — \n\n20211 2 2 2 2 2 \n\n2022676 676 676 676 676 \n\n2023— 61 77 77 \n\n2024— 1,448 1,459 \n\n20251 1,186 \n\n2026249 \n\nTotal3,650 \n\nLiabilities for loss and LAE, net of reinsurance8,028 \n\nThe following table shows the average annual percentage payout of incurred losses for the Civil Liability line of business:\n\nAverage annual percentage payout of incurred losses by age, net of reinsurance (unaudited)\n\nYears\n123456789\n\nAverage annual percentage payout\n34%36%11%4%9%6%—%—%—%\n\n172\n\n[Table of Contents](#i70ff496d74d2478e8fff6b413c2fcd4c_7)\n\nFREEDOM HOLDING CORP.\n\nNOTES TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS MARCH 31, 2026\n\n(All amounts in thousands of United States dollars, except share data, unless otherwise stated)\n\nVehicle Owners\n\nIncurred losses and LAE, net of reinsurance for the years ended March 31\n\nAccidentThe information about incurred and paid claims development for the years ended March 31, 2018 to 2025, is presented as supplementary information.\n\nYear201820192020202120222023202420252026\n\n2018842 1,213 1,226 1,233 1,236 1,260 1,224 1,273 1,250 \n\n20191,010 1,455 1,479 1,489 1,565 1,496 1,556 1,533 \n\n20201,718 2,456 2,551 2,759 2,579 2,707 2,644 \n\n20213,584 4,671 5,289 4,725 4,902 4,747 \n\n20227,215 10,245 9,290 9,349 8,976 \n\n202312,006 12,280 12,158 11,377 \n\n20248,636 6,570 6,342 \n\n202519,840 19,502 \n\n202661,203 \n\nTotal117,574 \n\nCumulative paid losses and LAE, net of reinsurance\n\n2018842 1,213 1,226 1,233 1,236 1,236 1,236 1,236 1,250 \n\n20191,010 1,455 1,479 1,489 1,509 1,514 1,514 1,533 \n\n20201,548 2,418 2,515 2,592 2,592 2,624 2,644 \n\n20212,837 4,539 4,656 4,688 4,709 4,747 \n\n20225,778 8,650 8,808 8,915 8,976 \n\n20238,343 11,044 11,209 11,293 \n\n20244,217 5,988 6,070 \n\n202512,532 18,298 \n\n202648,733 \n\nTotal103,544 \n\nLiabilities for loss and LAE, net of reinsurance14,030 \n\nThe following table shows the average annual percentage payout of incurred losses for the Vehicle Owners line of business:\n\nAverage annual percentage payout of incurred losses by age, net of reinsurance (unaudited)\n\nYears\n123456789\n\nAverage annual percentage payout\n67%29%2%1%—%—%—%—%1%\n\n173\n\n[Table of Contents](#i70ff496d74d2478e8fff6b413c2fcd4c_7)\n\nFREEDOM HOLDING CORP.\n\nNOTES TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS MARCH 31, 2026\n\n(All amounts in thousands of United States dollars, except share data, unless otherwise stated)\n\nCompulsory employer liability insurance\n\nIncurred losses and LAE, net of reinsurance for the years ended March 31\n\nAccidentThe information about incurred and paid claims development for the years ended March 31, 2018 to 2025, is presented as supplementary information.\n\nYear201820192020202120222023202420252026\n\n2018451 530 670 757 805 928 1,100 1,224 1,277 \n\n2019561 477 450 437 540 585 585 569 \n\n2020901 825 722 808 907 932 1,059 \n\n20211,094 1,125 1,474 1,137 945 1,082 \n\n20221,067 1,166 1,240 1,076 1,269 \n\n20231,429 1,338 1,329 1,877 \n\n20242,761 3,055 3,048 \n\n20258,106 14,048 \n\n20263,624 \n\nTotal27,853 \n\nCumulative paid losses and LAE, net of reinsurance\n\n2018199 377 575 669 709 761 936 1,165 1,244 \n\n2019207 305 323 350 365 373 472 531 \n\n2020207 400 475 520 581 632 793 \n\n2021254 430 538 550 567 618 \n\n2022433 628 667 700 774 \n\n2023351 585 662 784 \n\n20241,120 1,817 2,079 \n\n20255,919 12,021 \n\n20261,311 \n\nTotal20,155 \n\nLiabilities for loss and LAE, net of reinsurance7,698 \n\nThe following table shows the average annual percentage payout of incurred losses for the Compulsory employer liability insurance line of business:\n\nAverage annual percentage payout of incurred losses by age, net of reinsurance (unaudited)\n\nYears\n123456789\n\nAverage annual percentage payout\n29.2%19.1%2.0%1.5%5.8%3.2%16.3%15.2%5.2%\n\n174\n\n[Table of Contents](#i70ff496d74d2478e8fff6b413c2fcd4c_7)\n\nFREEDOM HOLDING CORP.\n\nNOTES TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS MARCH 31, 2026\n\n(All amounts in thousands of United States dollars, except share data, unless otherwise stated)\n\nProperty Damage\n\nIncurred losses and LAE, net of reinsurance for the years ended March 31\n\nAccidentThe information about incurred and paid claims development for the years ended March 31, 2018 to 2025, is presented as supplementary information.\n\nYear201820192020202120222023202420252026\n\n2018458 496 543 540 540 399 523 544 540 \n\n2019— 5 5 10 — 10 10 10 \n\n20208 8 8 — 128 13 12 \n\n202156 50 283 183 117 112 \n\n2022110 118 141 121 117 \n\n202345 187 120 23 \n\n2024319 624 554 \n\n20254,145 3,856 \n\n20262,889 \n\nTotal8,113 \n\nCumulative paid losses and LAE, net of reinsurance\n\n2018458 496 540 540 540 540 540 540 540 \n\n2019— — — 10 10 10 10 10 \n\n20208 8 8 8 12 12 12 \n\n20212 8 112 112 112 112 \n\n20227 26 117 117 117 \n\n2023— 23 23 23 \n\n202440 43 230 \n\n202533 1,887 \n\n2026649 \n\nTotal3,580 \n\nLiabilities for loss and LAE, net of reinsurance4,533 \n\nThe following table shows the average annual percentage payout of incurred losses for the Property Damage line of business:\n\nAverage annual percentage payout of incurred losses by age, net of reinsurance (unaudited)\n\nYears\n123456789\n\nAverage annual percentage payout\n21%22%30%22%6%—%—%—%—%\n\n175\n\n[Table of Contents](#i70ff496d74d2478e8fff6b413c2fcd4c_7)\n\nFREEDOM HOLDING CORP.\n\nNOTES TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS MARCH 31, 2026\n\n(All amounts in thousands of United States dollars, except share data, unless otherwise stated)\n\nMotor Vehicle\n\nIncurred losses and LAE, net of reinsurance for the years ended March 31\n\nAccidentThe information about incurred and paid claims development for the years ended March 31, 2018 to 2025, is presented as supplementary information.\n\nYear201820192020202120222023202420252026\n\n2018140 162 166 166 166 231 165 171 166 \n\n2019175 195 195 195 252 194 202 195 \n\n2020203 253 253 490 246 256 247 \n\n2021288 337 581 345 359 346 \n\n2022310 518 558 433 413 \n\n2023938 824 989 768 \n\n20244,937 4,029 3,081 \n\n20254,661 3,635 \n\n20263,205 \n\nTotal12,056 \n\nCumulative paid losses and LAE, net of reinsurance\n\n2018140 162 166 166 166 166 166 166 166 \n\n2019174 191 195 195 195 195 195 195 \n\n2020178 246 246 247 247 247 247 \n\n2021242 327 340 346 346 346 \n\n2022243 403 403 413 413 \n\n2023419 753 753 758 \n\n20241,846 2,633 2,698 \n\n20252,226 2,645 \n\n20262,179 \n\nTotal9,647 \n\nLiabilities for loss and LAE, net of reinsurance2,409 \n\nThe following table shows the average annual percentage payout of incurred losses for the Motor Vehicle line of business:\n\nAverage annual percentage payout of incurred losses by age, net of reinsurance (unaudited)\n\nYears\n123456789\n\nAverage annual percentage payout\n69%24%4%3%—%—%—%—%—%\n\n176\n\n[Table of Contents](#i70ff496d74d2478e8fff6b413c2fcd4c_7)\n\nFREEDOM HOLDING CORP.\n\nNOTES TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS MARCH 31, 2026\n\n(All amounts in thousands of United States dollars, except share data, unless otherwise stated)\n\nNOTE 18 - OTHER LIABILITIES\n\nAs of March 31, 2026 and 2025, other liabilities of the Company included the following:\n\nMarch 31, 2026March 31, 2025\n\nLoans received$96,771 $24,860 \n\nFinancial liability measured at fair value66,662 32,087 \n\nVacation reserve21,333 11,698 \n\nSalaries and other employee benefits20,787 17,326 \n\nPayable to suppliers14,405 9,815 \n\nOther advances received12,077 3,683 \n\nTaxes payable other than income tax11,778 6,338 \n\nReserves for contingent liabilities10,000 — \n\nDeferred income tax liabilities6,552 62 \n\nOutstanding settlements operations448 — \n\nDeferred distribution payments156 156 \n\nPayable for acquisition— 2,672 \n\nOther24,278 21,040 \n\nTotal other liabilities$285,247 $129,737 \n\nTable below represents loans received by the Company as of March 31, 2026 and 2025:\n\nLenderIssue dateAmountInterest rateMaturity dateDenominated currency\n\nDevelopment Bank of Kazakhstan JSC\nSeptember 202412,062 10.0 %April 2027KZT\n\nJSC \"Agrarian Credit Corporation\"January 202613,733 1.5 %March 2027KZT\n\nJSC \"Agrarian Credit Corporation\"December 202516,292 1.5 %December 2040KZT\n\n“Damu” Entrepreneurship DevelopmentMay 202522,095 2.0 %May 2040KZT\n\n“Damu” Entrepreneurship DevelopmentAugust 20259,444 2.0 %May 2040KZT\n\n“Damu” Entrepreneurship DevelopmentMay 20251,044 3.5 %December 2031KZT\n\n“Damu” Entrepreneurship DevelopmentOctober, 202511,784 2.0 %September 2035KZT\n\n“Damu” Entrepreneurship DevelopmentNovember, 20259,103 2.0 %September 2035KZT\n\nOther\nOctober 2020\n1,214 \n20%, 38%\nDecember 2028KZT, TRY\n\nTotal loans received$96,771 \n\nLenderIssue dateAmountInterest rateMaturity dateDenominated currency\n\nDevelopment Bank of Kazakhstan JSC\nSeptember 2024$13,815 10.0 %April 2027KZT\n\nJSC \"Agrarian Credit Corporation\"March 20256,938 1.5 %February 2026KZT\n\nJSC \"Agrarian Credit Corporation\"December 20243,965 1.5 %February 2026KZT\n\nOther142 \n\nTotal loans received$24,860 \n\nAs of March 31, 2026 and 2025, the Company was in compliance with all financial covenants under the loan from Development Bank of Kazakhstan JSC.\n\n177\n\n[Table of Contents](#i70ff496d74d2478e8fff6b413c2fcd4c_7)\n\nFREEDOM HOLDING CORP.\n\nNOTES TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS MARCH 31, 2026\n\n(All amounts in thousands of United States dollars, except share data, unless otherwise stated)\n\nThe JSC \"Agrarian Credit Corporation\", “Damu” Entrepreneurship Development and other loans do not impose any financial covenants.\n\nAs of March 31, 2026 and 2025, other liabilities included structured product financial liabilities issued by the Group’s wholly owned subsidiary,FSP, in the amount of $63,861 and $32,087 respectively.\n\nThe Group, through FSP, enters into bilateral over-the-counter structured product transactions with investors. These instruments are funded structured equity-linked products referencing single equities or baskets of equities. Depending on the product terms, the instruments may include participation features, protection features, coupon features, barrier conditions, autocall provisions and early termination rights. The instruments are cash-settled and do not provide investors with ownership of, or recourse to, the underlying reference assets. The Group elected the fair value option for these structured product financial liabilities at initial recognition. The election was made because the instruments contain embedded equity-linked derivative features and are managed and measured on a fair value basis. Accordingly, the Group measures the entire instruments at fair value in the consolidated balance sheets, with changes in fair value recognized in current earnings within Net gain/(loss) on derivatives in the consolidated statements of operations. No embedded derivative features are separately bifurcated.\n\nThe following table presents the fair value of derivative instruments as of March 31, 2026 and 2025:\n\nMarch 31, 2026March 31, 2025\n\nStructured product financial liabilities measured at fair value63,861 32,087 \n\nTotal$63,861 $32,087 \n\nThe following table presents the effect of structured product financial liabilities on the consolidated statements of operations:\n\nYear ended\n\nMarch 31, 2026\n\nYear ended\n\nMarch 31, 2025\n\nYear ended\n\nMarch 31, 2024\n\nNet gain on structured product financial liabilities$13,976 $4,474 $103 \n\nTotal$13,976 $4,474 $103 \n\nThese amounts are included in Net gain on derivatives in the consolidated statements of operations.\n\nThe fair value of structured product financial liabilities is estimated using valuation techniques appropriate for the contractual features of the instruments, including simulation-based and option-pricing models, as applicable. Significant inputs may include quoted prices of underlying reference assets, market-implied or internally adjusted volatilities, correlations, dividend assumptions and interest rates.\n\nStructured product financial liabilities are classified within Level 2 when fair value is determined using observable or market-corroborated inputs that are significant to the measurement. Structured product financial liabilities are classified within Level 3 when valuation incorporates one or more significant unobservable inputs. The Group classifies PHX products within Level 3 of the fair value hierarchy because the valuation of these instruments incorporates internally developed volatility adjustments to market-implied volatility that are significant to the fair value measurement. DGT and PTC products are classified within Level 2 because the significant inputs used in their valuation are observable or market-corroborated. As of March 31, 2026, structured product financial liabilities were classified within the fair value hierarchy in accordance with ASC 820 as follows: $39,953 within Level 3 and $23,908 within Level 2.\n\nThe following table provides a reconciliation of changes in Level 3 derivative liabilities:\n\n178\n\n[Table of Contents](#i70ff496d74d2478e8fff6b413c2fcd4c_7)\n\nFREEDOM HOLDING CORP.\n\nNOTES TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS MARCH 31, 2026\n\n(All amounts in thousands of United States dollars, except share data, unless otherwise stated)\n\nYear ended\n\nMarch 31, 2026\n\nYear ended\n\nMarch 31, 2025\n\nBalance at beginning of period$26,892 $1,683 \n\nIssuances (origination of contracts)59,770 35,305 \n\nSettlements and terminations(32,453)(4,142)\n\nNet (gains) on structured products recognized in earnings(14,256)(5,954)\n\nBalance at end of period$39,953 $26,892 \n\nGains and losses related to Level 3 instruments are included in Net gain/(loss) on derivatives in the consolidated statements of operations.\n\nThe significant unobservable input used in the valuation of Level 3 PHX structured product financial liabilities is internally developed volatility. Changes in internally developed volatility assumptions could result in a significantly higher or lower fair value measurement depending on the contractual features of the instrument and changes in other valuation inputs.\n\nValuation techniqueSignificant unobservable inputRange / weighted average\n\nPHX structured derivative liabilitiesSimulation-based and option-pricing modelsInternally developed volatility\n1.4% to (44)% p.a./ 7.2%\n\nThe Group considered the effect of nonperformance risk, including own credit risk and funding valuation adjustment, on the fair value measurement of structured product financial liabilities and concluded that a separate own-credit or funding valuation adjustment was not material as of March 31, 2026. Accordingly, no amount attributable to changes in instrument-specific credit risk was separately recognized in accumulated other comprehensive income. Structured product financial liabilities expose the Group to market risk arising from changes in market prices of the underlying reference assets and related valuation inputs. These instruments are unsecured obligations of FSP and are not collateralized.\n\n179\n\n[Table of Contents](#i70ff496d74d2478e8fff6b413c2fcd4c_7)\n\nFREEDOM HOLDING CORP.\n\nNOTES TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS MARCH 31, 2026\n\n(All amounts in thousands of United States dollars, except share data, unless otherwise stated)\n\nNOTE 19 - FEE AND COMMISSION INCOME AND EXPENSE\n\nFee and commission income is recognized when, or as, the Group satisfies its performance obligations by transferring the promised services to the customers. A service is transferred to a customer when, or as, the customer obtains control of that service. A performance obligation may be satisfied at a point in time or over time. Revenue from a performance obligation satisfied at a point in time is recognized at the point in time that the Group determines the customer obtains control over the promised service. Revenue from a performance obligation satisfied over time is recognized by measuring the Group's progress in satisfying the performance obligation in a manner that depicts the transfer of the services to the customer. The amount of revenue recognized reflects the consideration the Group expects to receive in exchange for those promised services (i.e., the \"transaction price\"). In determining the transaction price, the Group considers multiple factors, including the effects of variable consideration, if any.\n\nThe Group's revenues from contracts with customers are recognized when the Group's performance obligations are satisfied at an amount that reflects the consideration expected to be received in exchange for such services. The majority of the Group's performance obligations are satisfied at a point in time and are typically collected from customers by debiting their brokerage account with the Group.\n\nBrokerage Services\n\nThe Group earns commission revenue by executing, settling and clearing transactions with customers primarily in exchange-traded and over-the-counter financial instruments related to corporate equity and debt securities, money market instruments and exchange-traded options and futures contracts. Trade execution and clearing services, when provided together, represent a single performance obligation, as the services are not separately identifiable in the context of the contract. Commission revenue associated with combined trade execution and clearing services, as well as trade execution services on a standalone basis, are recognized at a point in time on trade date when the performance obligation is satisfied.\n\nBanking Services\n\nThe Group earns revenue from two primary streams related to commissions from bank services:\n\n•The Group earns banking commissions by executing customer orders for money transfer, purchase and sale of foreign currency, and other banking services. A substantial portion of the Group's revenue is derived from commissions from private customers through accounts with transaction-based pricing. Commission revenue is collected and recognized by the Company at a point in time at the execution of the order.\n\n•Interchange — The Group acts as an agent between customers and international payment systems, such as VISA and MasterCard. When using third-party payment platforms or networks, the Group is an agent for the payment processing services to retail customers and, therefore, revenue is recognized on a net basis, as the Group is not primarily responsible for fulfilling the payment processing on third parties' payment platforms/networks and has no discretion in establishing the selling price of the payment processing service to the retail customer on third party payment platforms/networks. Fees from customers using third-party payment platform are earned for processing debit card transactions.\n\nThe Group launched a cashback-based loyalty program, according to which cashbacks are provided for purchases made with bank's card, depending on the customer loyalty-level. If cash or another form of consideration provided to a customer, the Group reduces the transaction price. During the year ended March 31, 2026, the Group netted its cashback incentives with bank services fee in the amount of $154.8 million, compared to $24.2 million for the year ended March 31, 2025.\n\n180\n\n[Table of Contents](#i70ff496d74d2478e8fff6b413c2fcd4c_7)\n\nFREEDOM HOLDING CORP.\n\nNOTES TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS MARCH 31, 2026\n\n(All amounts in thousands of United States dollars, except share data, unless otherwise stated)\n\nPayment Processing\n\nThe Group earns revenue from two primary streams related to payment processing:\n\n•Commissions from payment processing services, which include activities such as authorization, clearing, and settlement of electronic payments. The Company recognizes revenue at the time when the payment card transaction is completed. Commission rates are based on the amounts of transactions. Fees are typically billed and paid monthly.\n\n•Provision of IT infrastructure to merchants to facilitate payments. The Company recognizes revenue at the time when the performance obligation is satisfied which is as soon as payments are facilitated. These services are typically provided under a commission rate from amounts of facilitated payments. Fees are typically billed and paid monthly.\n\nUnderwriting and market-making services\n\nThe Group earns underwriting revenues by providing capital raising solutions for corporate customers through initial public offerings, follow-on offerings, equity-linked offerings, private investments in public entities, and private placements. Underwriting revenues are recognized at a point in time on the relevant placement date, as the customer obtains the control and benefit of the capital markets offering at that point. These revenues are generally received within 90 days after the placement date. Transaction-related expenses, primarily consisting of legal, travel and other costs directly associated with the transaction, are included in underwriting revenues. These costs are deferred and recognized in the same period as the related investment banking transaction revenue. However, if the transaction is abandoned and does not close, the accounting treatment for the transaction-related costs may differ. In such cases, the accounting principles typically require the immediate recognition of the transaction-related expenses as an expense in the period in which the decision to abandon the transaction is made. This ensures that the costs associated with the abandoned transaction are recognized and reflected accurately in the financial statements of the entity.\n\nReceivables and Contract Balances\n\nReceivables arise when the Group has an unconditional right to receive payment under a contract with a customer and are derecognized when the cash is received. Margin lending, brokerage and other receivables are disclosed in Note 7 \"Margin Lending, Brokerage and Other Receivables, Net\" in the notes to consolidated financial statements.\n\nContract assets arise when the revenue associated with the contract is recognized before the Group's unconditional right to receive payment under a contract with a customer (i.e., unbilled receivable) and are derecognized when either it becomes a receivable or the cash is received. As of March 31, 2026, March 31, 2025 and March 31, 2024 contract asset balances were not material.\n\nContract liabilities arise when customers remit contractual cash payments in advance of the Group satisfying its performance obligations under the contract and are derecognized when the revenue associated with the contract is recognized either when a milestone is met triggering the contractual right to bill the customer or when the performance obligation is satisfied. As of March 31, 2026, March 31, 2025 and March 31, 2024 contract liability balances were not material.\n\nDuring the year ended March 31, 2026, March 31, 2025 and March 31, 2024 fee and commission income was comprised of:\n\n181\n\n[Table of Contents](#i70ff496d74d2478e8fff6b413c2fcd4c_7)\n\nFREEDOM HOLDING CORP.\n\nNOTES TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS MARCH 31, 2026\n\n(All amounts in thousands of United States dollars, except share data, unless otherwise stated)\n\nYear ended March 31, 2026\n\nBrokerage\n\nBanking\nInsuranceOtherTotal\n\nBrokerage services$504,283 $— $— $— $504,283 \n\nCommission income from payment processing— — — 22,755 22,755 \n\nAgency fee income— 7 — 21,412 21,419 \n\nUnderwriting and market-making services9,473 — — — 9,473 \n\nBank services— (74,335)— — (74,335)\n\nOther fee and commission income549 1,632 — 3,989 6,170 \n\nTotal fee and commission income$514,305 $(72,696)$— $48,156 $489,765 \n\nAgency fee expense19 211 122,981 — 123,211 \n\nBrokerage services45,580 295 2 159 46,036 \n\nBank services6,698 23,649 365 414 31,126 \n\nExchange services6,303 — — 169 6,472 \n\nCentral Depository services1,323 — — — 1,323 \n\nOther commission expenses886 — — 9,511 10,397 \n\nTotal fee and commission expense60,809 24,155 123,348 10,253 218,565 \n\nYear ended March 31, 2025\n\nBrokerage\n\nBanking\nInsuranceOtherTotal\n\nBrokerage services$430,136 $— $— $— $430,136 \n\nCommission income from payment processing— — — 28,711 28,711 \n\nAgency fee income— — — 15,616 15,616 \n\nBank services— 13,336 — — 13,336 \n\nUnderwriting and market-making services11,210 — — — 11,210 \n\nOther fee and commission income493 1,353 — 4,171 6,017 \n\nTotal fee and commission income$441,839 $14,689 $— $48,498 $505,026 \n\nAgency fee expense— 36 284,447 — 284,483 \n\nBank services4,806 14,419 538 301 20,064 \n\nBrokerage services19,846 — — — 19,846 \n\nExchange services1,546 — — 230 1,776 \n\nCentral Depository services706 — 1 — 707 \n\nOther commission expenses2,376 107 22 17,121 19,626 \n\nTotal fee and commission expense29,280 14,562 285,008 17,652 346,502 \n\n182\n\n[Table of Contents](#i70ff496d74d2478e8fff6b413c2fcd4c_7)\n\nFREEDOM HOLDING CORP.\n\nNOTES TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS MARCH 31, 2026\n\n(All amounts in thousands of United States dollars, except share data, unless otherwise stated)\n\nYear ended March 31, 2024\n\nBrokerage\n\nBanking\nInsuranceOtherTotal\n\nBrokerage services$333,383 $— $— $— $333,383 \n\nCommission income from payment processing— — — 41,659 41,659 \n\nBank services— 25,180 — — 25,180 \n\nUnderwriting and market-making services18,801 — — — 18,801 \n\nAgency fee income— 108 296 15,468 15,872 \n\nOther fee and commission income297 948 — 4,193 5,438 \n\nTotal fee and commission income$352,481 $26,236 $296 $61,320 $440,333 \n\nAgency fee expense— — 103,385 — 103,385 \n\nBank services2,538 13,217 208 2,158 18,121 \n\nBrokerage services16,506 2 3 76 16,587 \n\nExchange services3,133 — — 169 3,302 \n\nCentral Depository services446 — — — 446 \n\nOther commission expenses2,117 — 115 10,643 12,875 \n\nTotal fee and commission expense24,740 13,219 103,711 13,046 154,716 \n\n183\n\n[Table of Contents](#i70ff496d74d2478e8fff6b413c2fcd4c_7)\n\nFREEDOM HOLDING CORP.\n\nNOTES TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS MARCH 31, 2026\n\n(All amounts in thousands of United States dollars, except share data, unless otherwise stated)\n\nNOTE 20 - NET GAIN/(LOSS) ON TRADING SECURITIES\n\nFor years ended March 31, 2026, 2025 and 2024 net gain/(loss) on trading securities included the following:\n\nYear ended\n\nMarch 31, 2026\n\nYear ended\n\nMarch 31, 2025\n\nYear ended March 31, 2024\n\nNet gain recognized during the period on trading securities sold during the period$163,963 $65,855 $38,125 \n\nNet unrealized (loss)/gain recognized during the reporting period on trading securities still held at the reporting date(5,139)(123,665)95,729 \n\nNet gain/(loss) recognized during the period on trading securities$158,824 $(57,810)$133,854 \n\nDuring the year ended March 31, 2026, the Group sold securities for a gain of $163,963 and recognized unrealized loss in the amount of $5,139. During the year ended March 31, 2025 the Group sold securities for a gain of $65,855 and recognized unrealized loss in the amount of $123,665.\n\nNOTE 21 - NET INTEREST INCOME/EXPENSE\n\nNet interest income/expense includes:\n\nYear ended\n\nMarch 31, 2026\n\nYear ended\n\nMarch 31, 2025\n\nYear ended March 31, 2024\n\nInterest income:\n\nInterest income on loans to customers$283,657 $207,802 $176,539 \n\nInterest income on margin loans to customers277,633 212,360 175,571 \n\nInterest income on trading securities191,021 378,350 426,428 \n\nInterest income on available-for-sale securities\n58,276 40,297 32,821 \n\nInterest income on held-to-maturity securities\n49,670 1,000 — \n\nInterest income on reverse repurchase agreements and amounts due from banks21,208 24,644 16,865 \n\nOther interest income\n1,013 — — \n\nTotal interest income$882,478 $864,453 $828,224 \n\nInterest expense:\n\nInterest expense on customer accounts and deposits$204,578 $111,541 $70,778 \n\nInterest expense on securities repurchase agreement obligations162,760 340,863 402,665 \n\nInterest expense on debt securities issued81,757 36,130 10,356 \n\nInterest expense on margin lending payable31,687 45,748 16,990 \n\nInterest expense on loans received2,950 1,568 124 \n\nOther interest expense5,304 45 198 \n\nTotal interest expense$489,036 $535,895 $501,111 \n\nNet interest income$393,442 $328,558 $327,113 \n\n184\n\n[Table of Contents](#i70ff496d74d2478e8fff6b413c2fcd4c_7)\n\nFREEDOM HOLDING CORP.\n\nNOTES TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS MARCH 31, 2026\n\n(All amounts in thousands of United States dollars, except share data, unless otherwise stated)\n\nNOTE 22 - NET GAIN ON FOREIGN EXCHANGE OPERATIONS\n\nNet gain on foreign exchange operations includes:\n\nYear ended\n\nMarch 31, 2026\n\nYear ended\n\nMarch 31, 2025\n\nYear ended March 31, 2024\n\nSales and purchases of foreign currency, dealing$59,063 $75,095 $67,490 \n\nTranslation of financial assets and financial liabilities 8,617 (23,411)4,755 \n\nTotal net gain on foreign exchange operations$67,680 $51,684 $72,245 \n\nNOTE 23 - NET GAIN/(LOSS) ON DERIVATIVES\n\nFor years ended March 31, 2026, 2025 and 2024 net gain/(loss) on derivatives included the following:\n\nYear ended\n\nMarch 31, 2026\n\nYear ended\n\nMarch 31, 2025\n\nYear ended March 31, 2024\n\nNet realized gain/(loss) on derivatives$52,878 $4,989 $(100,785)\n\nNet unrealized gain/(loss) on derivatives13,894 7,415 (3,009)\n\nTotal net gain/(loss) on derivatives$66,772 $12,404 $(103,794)\n\n185\n\n[Table of Contents](#i70ff496d74d2478e8fff6b413c2fcd4c_7)\n\nFREEDOM HOLDING CORP.\n\nNOTES TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS MARCH 31, 2026\n\n(All amounts in thousands of United States dollars, except share data, unless otherwise stated)\n\nNOTE 24 - RELATED PARTY TRANSACTIONS\n\nYear ended\n\nMarch 31, 2026\n\nYear ended\n\nMarch 31, 2025\n\nRelated party balancesTotal category as per financial statements captionsRelated party balancesTotal category as per financial statements captions\n\nASSETS\n\nCash and cash equivalents$1,771 $966,115 $2,233 $837,302 \n\nCompanies controlled by management1,771 2,233 \n\nRestricted cash$6,586 $1,246,312 $30 $807,468 \n\nCompanies controlled by management6,586 30 \n\nInvestment securities$8,117 $3,342,561 $1,174 $2,814,733 \n\nCompanies controlled by management8,117 1,174 \n\nMargin lending, brokerage and other receivables, net$22,267 $4,690,782 $41,308 $3,319,145 \n\nManagement19,946 10,080 \n\nCompanies controlled by management2,315 31,228 \n\nOther6 — \n\nLoans issued$21,321 $2,077,606 $188,445 $1,595,435 \n\nManagement475 291 \n\nCompanies controlled by management20,846 188,154 \n\nOther assets, net$40,119 $264,621 $18,080 $169,641 \n\nManagement17,885 486 \n\nCompanies controlled by management22,234 17,594 \n\nLIABILITIES\n\nCustomer liabilities$94,808 $7,103,984 $48,161 $4,304,999 \n\nManagement33,854 13,827 \n\nCompanies controlled by management58,592 32,607 \n\nOther2,362 1,727 \n\nMargin lending and trade payables$836 $689,641 $1,307 $1,322,241 \n\nManagement441 201 \n\nCompanies controlled by management395 1,106 \n\nInsurance contract liabilities$6,437 $653,907 $5,960 $472,433 \n\nCompanies controlled by management6,437 5,960 \n\nOther liabilities$2,984 $285,247 $1,407 $129,737 \n\nManagement250 1,281 \n\nCompanies controlled by management2,733 125 \n\nOther1 1 \n\n186\n\n[Table of Contents](#i70ff496d74d2478e8fff6b413c2fcd4c_7)\n\nFREEDOM HOLDING CORP.\n\nNOTES TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS MARCH 31, 2026\n\n(All amounts in thousands of United States dollars, except share data, unless otherwise stated)\n\nYear ended\n\nMarch 31, 2026\n\nYear ended\n\nMarch 31, 2025\n\nYear ended\n\nMarch 31, 2024\n\nRelated party amountsTotal category as per financial statements captionsRelated party amountsTotal category as per financial statements captionsRelated party amountsTotal category as per financial statements captions\n\nRevenue:\n\nFee and commission income$7,680 $489,765 $4,725 $505,026 $65,972 $440,333 \n\nManagement509 1,062 935 \n\nCompanies controlled by management7,158 3,655 65,035 \n\nOther13 8 2 \n\nInterest income$12,703 $882,478 $1,731 $864,453 $24,941 $828,224 \n\nManagement10,661 924 665 \n\nCompanies controlled by management2,029 807 24,276 \n\nOther13 — — \n\nNet insurance revenue$8,625 $402,396 $7,550 $571,224 $776 $245,122 \n\nManagement352 23 1 \n\nCompanies controlled by management8,267 7,524 775 \n\nOther6 3 — \n\nOther income/(expense)24,011 $25,930 (2,114)$17,072 (25)$9,696 \n\nManagement5 (1)— \n\nCompanies controlled by management24,005 (2,113)(25)\n\nOther1 — — \n\nExpense:\n\nFee and commission expense$4,344 $218,565 $2,269 $346,502 $127 $154,716 \n\nManagement— 1 — \n\nCompanies controlled by management4,344 2,268 127 \n\nInterest expense$2,376 $489,036 $1,359 $535,895 $955 $501,111 \n\nManagement761 495 307 \n\nCompanies controlled by management1,534 825 642 \n\nOther81 39 6 \n\nAdvertising and sponsorship expense$27,151 $103,304 $18,497 $124,627 $— $38,327 \n\nCompanies controlled by management27,151 18,497 — \n\nAs of March 31, 2026, the Group had loans issued which included uncollateralized bank customer loans purchased from FFIN Credit, a company outside of the Group which is controlled by Timur Turlov. Beginning in September 2025, the Bank transitioned retail loan origination to its own platform and discontinued the purchase of unsecured consumer loans from FFIN Credit. For the details of financial impact of the transaction, see in Note 8 \"Loans issued\".\n\nAs of March 31, 2026, 26% of the Group's total related party other assets consisted of a prepayment to Freedom Data Centers LLP (formerly, Freedom Telecom LLP) for the potential acquisition of A-Telecom LLP compared to 55% as of March 31, 2025. The potential acquisition of A-Telecom LLP is part of the Group’s strategy to expand its presence in the\n\n187\n\n[Table of Contents](#i70ff496d74d2478e8fff6b413c2fcd4c_7)\n\nFREEDOM HOLDING CORP.\n\nNOTES TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS MARCH 31, 2026\n\n(All amounts in thousands of United States dollars, except share data, unless otherwise stated)\n\ntelecommunications market in Kazakhstan and to develop a digital fintech ecosystem. Freedom Data Centers LLP is considered a related party based on the scale of its economic transactions with the Group.\n\nAs of March 31, 2026, 13% of the Group's total related party customer liabilities were bank deposits from Turlov Family Office Securities (PTY) LTD held with Freedom Bank KZ, compared to 13% as of March 31, 2025. Turlov Family Office Securities (PTY) LTD is a private securities brokerage company that is wholly owned by Mr. Timur Turlov. Additionally, 1% of the Group's total related party customer liabilities as of March 31, 2026 were from a private company ITS Central Securities Depository Limited, compared to 1% as of March 31, 2025. Private company ITS Central Securities Depository Limited is a subsidiary of International Trading System Limited, an affiliate of the Group.\n\nAs of both March 31, 2026 and March 31, 2025, 99% of the Group's total related party insurance contract liabilities were liabilities from FFIN Credit. The Group provides voluntary credit risk insurance covering losses arising from borrower defaults on microloan agreements originated by FFIN Credit. In addition, during the year ended March 31, 2026, the Group recognized $6,789 net insurance revenue, from such insurance services, compared to $6,135 recognized during the year ended March 31, 2025.\n\nThe Group continues to support the development of chess and football in Kazakhstan. During the year ended March 31, 2026, the Group incurred advertising and sponsorship expense from Kazakhstan Chess Federation in the amount of $10,026 and from Freedom Youth Football League of Kazakhstan in the amount of $10,705, compared to $11,222 and $3,497, respectively, during the year ended March 31, 2025. Kazakhstan Chess Federation is a Kazakhstan-based company in which Timur Turlov holds a management position. Freedom Youth Football League of Kazakhstan is a Kazakhstan-based company fully owned by Turlov Private Holding, in which Timur Turlov holds 99.9% of the shares. The sponsorship contributions to the Kazakhstan Chess Federation and Freedom Youth Football League of Kazakhstan during the year ended March 31, 2026 were made to support the preparation and holding of championships, tournaments, training camps and other events.\n\nNOTE 25 - STOCKHOLDERS' EQUITY\n\nDuring the fiscal year ended March 31, 2026 and 2025, the Company awarded stock grants totaling 381,538 and 766,958 shares, 160,884 and 162,779 of which were vested on the date of the award.\n\nThe table below presents Stock Incentive Plan awards granted on the dates indicated.\n\n188\n\n[Table of Contents](#i70ff496d74d2478e8fff6b413c2fcd4c_7)\n\nFREEDOM HOLDING CORP.\n\nNOTES TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS MARCH 31, 2026\n\n(All amounts in thousands of United States dollars, except share data, unless otherwise stated)\n\nStock awards granted on:Units\n\nApril 1, 2024 immediate stock grants10,360\n\nApril 1, 202438,250\n\nApril 23, 2024 immediate stock awards3,924\n\nApril 23, 202436,120\n\nJune 7, 2024 immediate stock awards18,313\n\nJune 24, 2024 immediate stock awards10,000\n\nJune 24, 202470,000\n\nJuly 1, 202434,250\n\nJuly 1, 2024 immediate stock awards4,300\n\nJuly 12, 202412,816\n\nAugust 5, 202410,000\n\nAugust 5, 2024 immediate stock awards5,000\n\nAugust 13, 202476,795\n\nAugust 13, 2024 immediate stock awards13,498\n\nOctober 1, 202447,850\n\nOctober 10, 2024 immediate stock awards750\n\nJanuary 23, 2025 immediate stock awards1,000\n\nFebruary 13, 202584,492\n\nFebruary 13, 2025 immediate grants21,123\n\nFebruary 28, 2025193,606\n\nFebruary 28, 2025 immediate grants74,511\n\nApril 8, 2025 immediate stock grants92,979\n\nApril 8, 202522,612\n\nMay 1, 20255,000\n\nMay 29, 2025 immediate stock grants6,950\n\nMay 29, 202589,150\n\n9 July 2025 immediate stock grants14,169\n\n5 August 2025 immediate stock grants2,000\n\n5 August 202513,000\n\n16 September 2025 immediate stock grants3,028\n\n16 October 20253,338\n\n17 October 2025 immediate stock grants2,354\n\n17 October 202517,752\n\n28 November 20256,236\n\n2 December 2025911\n\n11 February 202662,655\n\n11 February 2026 immediate stock grants39,404\n\nNOTE 26 - STOCK BASED COMPENSATION\n\nThe compensation expense related to restricted stock awards was $68,047 during the year ended March 31, 2026, and $59,592 during the year ended March 31, 2025. As of March 31, 2026, there was $46,174 of total unrecognized compensation cost related to non-vested shares of stock awarded. The cost is expected to be recognized over a weighted average period of 4.6 years. The compensation expense related to stock awards, which vested on the date of the award was $19,735 during the year ended March 31, 2026, and $19,548 during the year ended March 31, 2025.\n\n189\n\n[Table of Contents](#i70ff496d74d2478e8fff6b413c2fcd4c_7)\n\nFREEDOM HOLDING CORP.\n\nNOTES TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS MARCH 31, 2026\n\n(All amounts in thousands of United States dollars, except share data, unless otherwise stated)\n\nThe Company has determined the fair value of FRHC shares awarded during the years ended March 31, 2026, March 31, 2025 and March 31, 2024 using the Monte Carlo valuation model based on the following key assumptions:\n\nStock awards granted Term (years)VolatilityRisk-free rate\n\nOctober 6, 20223.6247.90 %3.24 %\n\nMarch 1, 20244.9136.60 %4.18 %\n\nApril 1, 20244.8236.62 %4.36 %\n\nApril 23, 20244.7636.68 %4.65 %\n\nJune 24, 20244.5936.89 %4.31 %\n\nJuly 1, 20244.5736.98 %4.47 %\n\nJuly 12, 20241.5437.30 %4.64 %\n\nAugust 5, 20244.4837.51 %3.64 %\n\nAugust 13, 20244.4537.69 %3.70 %\n\nOctober 1, 20244.3237.03 %3.51 %\n\nFebruary 13, 20253.9535.41 %4.35 %\n\nFebruary 28, 20254.9136.42 %4.03 %\n\nApril 8, 20253.8135.80 %3.78 %\n\nMay 1, 20251.0037.70 %3.98 %\n\nMay 29, 20254.6638.85 %3.98 %\n\nAugust 5, 20253.4838.70 %3.66 %\n\nOctober 16, 20250.5447.50 %3.77 %\n\nOctober 17, 20254.2837.10 %3.55 %\n\nNovember 28, 20253.1638.30 %3.50 %\n\nDecember 3, 20250.6642.40 %3.65 %\n\nFebruary 11, 20264.9637.20 %3.75 %\n\nThe table below summarizes the activity for the Company's stock awards outstanding during the year ended March 31, 2026:\n\nShares Weighted\nAverage\nFair Value\n\nOutstanding, March 31, 2025\n1,207,307 97,748 \n\nGranted381,525 48,894 \n\nVested(610,443)(55,172)\n\nForfeited/cancelled/expired(74,906)(5,694)\n\nOutstanding, March 31, 2026\n903,483 85,776 \n\nNOTE 27 - LEASES\n\nAt March 31, 2026, the Group was obligated under a number of noncancellable leases, predominantly operating leases of office space, which expire at various dates through 2034. The Group's primary involvement with leases is in the capacity as a lessee where a Group lease premises to support its business.\n\nThe Group determines whether a contract is or contains a lease at inception of the contract and whether that lease meets the classification criteria of a finance or operating lease. Operating lease liabilities and right-of-use (ROU) assets are recognized at the lease commencement date based on the present value of the future minimum lease payments over the lease term. The future lease payments are discounted at a rate that estimates the Company's collateralized borrowing rate for financing instruments of a similar term and are included in accounts payable and other liabilities. The operating lease ROU asset, included in premises and equipment, also includes any lease prepayments made, plus initial direct costs\n\n190\n\n[Table of Contents](#i70ff496d74d2478e8fff6b413c2fcd4c_7)\n\nFREEDOM HOLDING CORP.\n\nNOTES TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS MARCH 31, 2026\n\n(All amounts in thousands of United States dollars, except share data, unless otherwise stated)\n\nincurred, less any lease incentives received. The Company recognizes fixed lease costs on a straight-line basis throughout the lease term in the Consolidated Statement of Income. Certain of these leases also have extension or termination options, and the Company assess the likelihood of exercising such options. If it is reasonably certain that the Group will exercise the options to extend, then we include the impact in the measurement of our right-of-use assets and lease liabilities.\n\nWhen readily determinable, the Company uses the rate implicit in the lease to discount lease payments to present value; however, the rate implicit on most of the Group's leases are not readily determinable. Therefore, the Company must discount lease payments based on an estimate of its incremental borrowing rate.\n\nThe table below presents the lease related assets and liabilities recorded on the Company's consolidated balance sheets as of March 31, 2026 and March 31, 2025:\n\nClassification on Balance Sheet\nMarch 31, 2026\nMarch 31, 2025\n\nAssets\n\nOperating lease assetsRight-of-use assets$47,579 $39,828 \n\nTotal lease assets$47,579 $39,828 \n\nLiabilities\n\nOperating lease liability\nLease liability\n$48,843 $40,525 \n\nTotal lease liability$48,843 $40,525 \n\nThe following table presents as of March 31, 2026, the annual maturities of the lease liabilities:\n\nLeases maturing during twelve months ended March 31,\n\n2027$21,053 \n\n202817,784 \n\n202910,289 \n\n20306,320 \n\n20313,159 \n\nThereafter3,354 \n\nTotal payments61,959 \n\nLess: amounts representing interest(13,116)\n\nLease liability, net$48,843 \n\nWeighted average remaining lease term (in months)29\n\nWeighted average discount rate14 %\n\nLease commitments for short-term operating leases as of March 31, 2026 and March 31, 2025 was approximately $4,975 and $2,299, respectively. The Group's rent expense for office space was $12,912 for the year ended March 31, 2026 and $7,764 for the year ended March 31, 2025.\n\nThe Group has leases that involve variable payments tied to an index, which are considered in the measurement of operating lease right-of-use (ROU) assets and operating lease liabilities.\n\n191\n\n[Table of Contents](#i70ff496d74d2478e8fff6b413c2fcd4c_7)\n\nFREEDOM HOLDING CORP.\n\nNOTES TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS MARCH 31, 2026\n\n(All amounts in thousands of United States dollars, except share data, unless otherwise stated)\n\nNOTE 28 - ACQUISITIONS OF SUBSIDIARIES\n\nAcquisition of Freedom Cloud Holding\n\nOn April 30, 2025, the Company acquired 100% interest in Astel Group Ltd. (subsequently renamed on January 8, 2026 to Freedom Cloud Holding). Astel Group Ltd. is a provider of digital solutions and telecommunications services, and ranks among the largest telecom operators in Kazakhstan. Astel Group Ltd. provides advanced IT solutions including information security and cloud services.\n\nThe purpose of the acquisition of Astel Group Ltd. was to use the acquired assets and licenses to develop our telecommunications business.\n\nAs of April 30, 2025, the date of the acquisition of Astel Group Ltd., the fair value of net assets of Astel Group Ltd. was 21,646. The total purchase price was allocated as follows:\n\nAs of April 30, 2025\n\nASSETS\n\nCash and cash equivalents7,631 \n\nMargin lending, brokerage and other receivables, net5,047 \n\nFixed assets, net7,470 \n\nCurrent income tax asset433 \n\nRight-of-use asset92 \n\nOther assets, net3,255 \n\nTOTAL ASSETS23,928 \n\nLIABILITIES\n\nMargin lending and trade payables1,139 \n\nLease liabilities92 \n\nOther liabilities1,051 \n\nTOTAL LIABILITIES2,282 \n\nNet assets acquired21,646 \n\nGoodwill997 \n\nTotal purchase price22,643 \n\nNOTE 29 - COMMITMENTS AND CONTINGENCIES\n\nLegal, regulatory and governmental matters\n\nAs previously disclosed, since 2021, the Company and certain officers and directors have received subpoenas for documents and testimony from the SEC. The requested information relates to a number of topics related to an investigation, including settlement practices and relationships with certain institutional market maker customers of certain of our non-\n\n192\n\n[Table of Contents](#i70ff496d74d2478e8fff6b413c2fcd4c_7)\n\nFREEDOM HOLDING CORP.\n\nNOTES TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS MARCH 31, 2026\n\n(All amounts in thousands of United States dollars, except share data, unless otherwise stated)\n\nU.S. broker-dealer subsidiaries, and has included our accounting practices related to internalized trades, disclosures and internal controls. In the context of certain of those requests, on March 11, 2026, the Company and Company’s controlling shareholder, chairman and chief executive officer, Timur Turlov received a Wells Notice from the SEC staff in connection with the Investigation. The Wells Notice provides that the SEC staff has made a \"preliminary determination\" to recommend that the SEC file a civil enforcement action against the recipients alleging violations of certain provisions of the U.S. federal securities laws.\n\nA Wells Notice is neither a formal charge of wrongdoing nor a final determination that the recipient has violated any law. The issuance of a Wells Notice may or may not result in such actions or proceedings, and in some cases where a Wells Notice has been issued the matter may be settled or dismissed. The Company and Mr. Turlov have challenged the SEC’s “preliminary determination.” We face risks and uncertainties in connection with the Investigation, including a civil enforcement action or administrative proceeding brought by the SEC or other resolution, including settlement, which could result in the imposition of monetary and non-monetary relief against the Company and/or Mr. Turlov, and the matter could result in additional legal and other professional expenses, and could adversely affect the Company’s business, financial condition, results of operations, reputation and cash flows . However, we cannot reasonably estimate the reasonably possible loss (or range of loss), if any. In addition, the ultimate outcome of legal proceedings involves judgments and inherent uncertainties and cannot be predicted with certainty. This assessment is based on the Group's current understanding of relevant facts and circumstances, and the Group's perspective on these matters may evolve with future developments.\n\nThe Group accounts for potential losses related to litigation in accordance with FASB ASC Topic 450, \"Contingencies.\" As of March 31, 2026 and 2025, accruals for potential losses related to legal, regulatory and governmental actions and proceedings were not material.\n\nEinride arbitration case\n\nIn January 2025, Einride AB, a limited liability company based in Stockholm, Sweden, specializing in electric and self-driving vehicle technologies (\"Einride\"), filed a request for arbitration and statement of claim with the SCC Arbitration Institute against FRHC (the \"Claim\"). The Claim was related to the Einride's raising of a convertible loan through subscription to its convertible debentures. The Claim alleged that FRHC failed to pay to subscribe for a nominal convertible debenture amount of $10,000, allegedly in breach of a Subscription Commitment signed between Einride and FRHC in 2024. Einride sought monetary damages in the amount of $10,000, together with applicable interest and legal costs. FRHC contested the Claim and the relief sought by Einride. The arbitration was conducted under the SCC Arbitration Rules. The hearing on the merits was held in March 2026. On May 21, 2026, the arbitral tribunal issued its final award in favor of Einride, ordering FRHC to pay approximately $10,000. We recognized a corresponding loss contingency accrual in our consolidated financial statements.\n\nEmployment disputes\n\nDuring the financial year ended March 31, 2026, the Company became involved in certain additional claims, complaints and legal or regulatory proceedings arising in the ordinary course of its business, including employment-related matters. The Company believes the complaints are without merit and is currently defending against the allegations. At this time, the Company is unable to reasonably estimate the possible loss or range of loss, if any, related to these matters, and accordingly no provision has been recorded.\n\nOff-balance sheet financial instruments\n\nFreedom Bank KZ is a party to certain off-balance sheet financial instruments. These financial instruments include guarantees and unused commitments under existing lines of credit. These commitments expose the Company to varying degrees of credit and market risk which are essentially the same as those involved in extending loans to customers, and are subject to the same credit policies used in underwriting loans. Collateral may be obtained based on Freedom Bank KZ's credit evaluation of the counterparty. The Company's maximum exposure to credit loss is represented by the contractual amount of these commitments.\n\n193\n\n[Table of Contents](#i70ff496d74d2478e8fff6b413c2fcd4c_7)\n\nFREEDOM HOLDING CORP.\n\nNOTES TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS MARCH 31, 2026\n\n(All amounts in thousands of United States dollars, except share data, unless otherwise stated)\n\nUnused commitments under lines of credit\n\nUnused commitments under lines of credit include commercial, commercial real estate, home equity and consumer lines of credit to existing customers. These commitments may mature without being fully funded.\n\nUnused commitments under guarantees\n\nUnused commitments under guarantees are conditional commitments issued by Freedom Bank KZ to provide bank guarantees to customers. These commitments may mature without being fully funded.\n\nBank guarantees\n\nBank guarantees are conditional commitments issued by Freedom Bank KZ to guarantee the performance of a customer to a third party. These guarantees are primarily issued to support trade transactions or guarantee arrangements. The credit risk involved in issuing guarantees is essentially the same as that involved in extending loan facilities to customers. A significant portion of the issued guarantees are collateralized by cash. Total lending related commitments outstanding as of March 31, 2026 and 2025, were as follows:\n\nAs of\n\nMarch 31, 2026\n\nAs of\n\nMarch 31, 2025\n\nUnused commitments under lines of credits and guarantees\n$279,587 $44,239 \n\nBank guarantees39,953 15,039 \n\nTotal$319,540 $59,278 \n\nAs of March 31, 2026, loans secured by cash constituted 97% of the unused commitments under lines of credit and guarantees.\n\nCapital expenditure commitments\n\nAs of March 31, 2026, the Group had contractual capital expenditure commitments of up to $84,129 related to Freedom Telecom Operations Ltd. for equipment and software acquisition. These commitments are expected to be settled under the relevant agreements within the 5-year period and fall within the scope of the Group’s ordinary capital investment activities.\n\n194\n\n[Table of Contents](#i70ff496d74d2478e8fff6b413c2fcd4c_7)\n\nFREEDOM HOLDING CORP.\n\nNOTES TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS MARCH 31, 2026\n\n(All amounts in thousands of United States dollars, except share data, unless otherwise stated)\n\nNOTE 30 - SEGMENT REPORTING\n\nThe following tables summarize the Group's Statement of Operations by its reportable segments. There are no revenues from transactions between the segments and intercompany balances have been eliminated for separate disclosure:\n\nYear ended March 31, 2026\n\nSTATEMENTS OF OPERATIONS\nBrokerageBankingInsuranceOtherTotal\n\nFee and commission income$514,305 $(72,696)$— $48,156 $489,765 \n\nNet gain on trading securities13,969 125,217 12,894 6,744 158,824 \n\nInterest income298,929 499,501 75,592 8,456 882,478 \n\nNet insurance revenue — — 402,396 — 402,396 \n\nNet (loss)/gain on foreign exchange operations(9,340)68,376 1,203 7,441 67,680 \n\nNet gain on derivative11,706 41,359 — 13,707 66,772 \n\nSales of goods and services— — — 97,446 97,446 \n\nOther income/(expense)1,939 27,445 5,699 (9,153)25,930 \n\nTOTAL REVENUE, NET831,508 689,202 497,784 172,797 2,191,291 \n\nFee and commission expense60,809 24,155 123,348 10,253 218,565 \n\nInterest expense43,109 348,603 6,863 90,461 489,036 \n\nInsurance claims and policyholder benefits, net of reinsurance— — 259,309 — 259,309 \n\nPayroll and bonuses156,437 91,064 37,922 141,048 426,471 \n\nProfessional services8,263 1,544 3,061 33,390 46,258 \n\nStock compensation expense20,725 11,265 13,660 22,397 68,047 \n\nAdvertising and sponsorship expense\n37,874 4,688 1,118 59,624 103,304 \n\nGeneral and administrative expense49,455 66,281 8,804 97,799 222,339 \n\n(Recoveries)/allowance for expected credit losses(1,403)39,616 13,674 478 52,365 \n\nCost of sales— — — 79,632 79,632 \n\nTOTAL EXPENSE375,269 587,216 467,759 535,082 1,965,326 \n\nINCOME/(LOSS) BEFORE INCOME TAX $456,239 $101,986 $30,025 $(362,285)$225,965 \n\nIncome tax (expense)/benefit(84,323)(17,983)(7,374)37,043 (72,637)\n\nNET INCOME/(LOSS) $371,916 $84,003 $22,651 $(325,242)$153,328 \n\n195\n\n[Table of Contents](#i70ff496d74d2478e8fff6b413c2fcd4c_7)\n\nFREEDOM HOLDING CORP.\n\nNOTES TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS MARCH 31, 2026\n\n(All amounts in thousands of United States dollars, except share data, unless otherwise stated)\n\nYear ended March 31, 2025\n\nSTATEMENTS OF OPERATIONS\nBrokerageBankingInsuranceOtherTotal\n\nFee and commission income$441,839 $14,689 $— $48,498 $505,026 \n\nNet gain/(loss) on trading securities10,487 (66,426)1,843 (3,714)(57,810)\n\nInterest income254,340 544,221 60,550 5,342 864,453 \n\nNet insurance revenue — — 571,224 — 571,224 \n\nNet gain on foreign exchange operations7,021 8,750 2,621 33,292 51,684 \n\nNet gain on derivative734 5,284 — 6,386 12,404 \n\nSales of goods and services— — — 40,102 40,102 \n\nOther income/(expense)2,928 (370)416 14,098 17,072 \n\nTOTAL REVENUE, NET717,349 506,148 636,654 144,004 2,004,155 \n\nFee and commission expense29,280 14,562 285,008 17,652 346,502 \n\nInterest expense84,543 400,905 12,331 38,116 535,895 \n\nInsurance claims and policyholder benefits, net of reinsurance— — 260,488 — 260,488 \n\nPayroll and bonuses98,352 62,876 31,565 94,554 287,347 \n\nProfessional services6,213 837 1,602 20,272 28,924 \n\nStock compensation expense27,584 12,617 10,792 8,599 59,592 \n\nAdvertising and sponsorship expense\n50,933 6,747 1,403 65,544 124,627 \n\nGeneral and administrative expense37,592 47,589 17,685 59,608 162,474 \n\nAllowance for expected credit losses/(recoveries)6,224 54,759 2,031 (569)62,445 \n\nCost of sales— — — 31,278 31,278 \n\nTOTAL EXPENSE340,721 600,892 622,905 335,054 1,899,572 \n\nINCOME/(LOSS) BEFORE INCOME TAX $376,628 $(94,744)$13,749 $(191,050)$104,583 \n\nIncome tax (expense)/benefit(61,122)8,252 (3,427)27,872 (28,425)\n\nINCOME/(LOSS) $315,506 $(86,492)$10,322 $(163,178)$76,158 \n\n196\n\n[Table of Contents](#i70ff496d74d2478e8fff6b413c2fcd4c_7)\n\nFREEDOM HOLDING CORP.\n\nNOTES TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS MARCH 31, 2026\n\n(All amounts in thousands of United States dollars, except share data, unless otherwise stated)\n\nYear ended March 31, 2024\n\nSTATEMENTS OF OPERATIONS\nBrokerageBankingInsuranceOtherTotal\n\nFee and commission income$352,481 $26,236 $296 $61,320 $440,333 \n\nNet gain/(loss) on trading securities33,483 87,459 14,114 (1,202)133,854 \n\nInterest income233,858 524,596 63,676 6,094 828,224 \n\nNet insurance revenue — — 245,122 — 245,122 \n\nNet (loss)/gain on foreign exchange operations(852)78,174 (1,306)(3,771)72,245 \n\nNet (loss)/gain on derivative(2,019)(101,805)— 30 (103,794)\n\nSales of goods and services— — — 21,576 21,576 \n\nOther income/(expense)5,003 1,210 3,603 (120)9,696 \n\nTOTAL REVENUE, NET621,954 615,870 325,505 83,927 1,647,256 \n\nFee and commission expense24,740 13,219 103,711 13,046 154,716 \n\nInterest expense89,732 368,286 29,965 13,128 501,111 \n\nInsurance claims and policyholder benefits, net of reinsurance— — 117,273 — 117,273 \n\nPayroll and bonuses71,077 48,953 18,056 42,197 180,283 \n\nProfessional services6,977 527 561 26,173 34,238 \n\nStock compensation expense11,352 6,124 2,755 2,488 22,719 \n\nAdvertising and sponsorship expense\n25,353 4,828 789 7,357 38,327 \n\nGeneral and administrative expense40,847 30,804 5,413 43,824 120,888 \n\nAllowance for expected credit losses2,962 16,399 942 922 21,225 \n\nCost of sales— — — 17,538 17,538 \n\nTOTAL EXPENSE273,040 489,140 279,465 166,673 1,208,318 \n\nINCOME/(LOSS) BEFORE INCOME TAX $348,914 $126,730 $46,040 $(82,746)$438,938 \n\nIncome tax (expense)/benefit(51,158)(15,857)(8,662)15,258 (60,419)\n\nINCOME/(LOSS) $297,756 $110,873 $37,378 $(67,488)$378,519 \n\nThe following tables summarize the Company's total assets and total liabilities by its business segments. Intercompany balances have been eliminated for separate disclosure:\n\nMarch 31, 2026\n\nBrokerageBankingInsuranceOtherTotal\n\nTotal assets$6,136,241 $5,359,812 $892,186 $767,000 $13,155,239 \n\nTotal liabilities4,763,038 4,727,241 680,071 1,495,610 11,665,960 \n\nNet assets$1,373,203 $632,571 $212,115 $(728,610)$1,489,279 \n\n197\n\n[Table of Contents](#i70ff496d74d2478e8fff6b413c2fcd4c_7)\n\nFREEDOM HOLDING CORP.\n\nNOTES TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS MARCH 31, 2026\n\n(All amounts in thousands of United States dollars, except share data, unless otherwise stated)\n\nMarch 31, 2025\n\nBrokerageBankingInsuranceOtherTotal\n\nTotal assets$4,344,555 $4,441,315 $713,452 $415,795 $9,915,117 \n\nTotal liabilities3,588,781 3,936,900 562,229 602,643 8,690,553 \n\nNet assets$755,774 $504,415 $151,223 $(186,848)$1,224,564 \n\nThe following table presents revenues for the years ended March 31, 2026, 2025, and 2024 and long-lived assets as of March 31, 2026 and March 31, 2025, classified by the major geographic areas based on subsidiaries' location.\n\nYear ended March 31, 2026\n\nRevenueBrokerageBankingInsuranceOtherTotal\n\nKazakhstan$511,821 $688,789 $497,784 $140,130 $1,838,524 \n\nArmenia181,726 — — — 181,726 \n\nCyprus126,859 — — 27,301 154,160 \n\nUS2,530 — — 398 2,928 \n\nOther8,572 413 — 4,968 13,953 \n\nTOTAL REVENUE, NET$831,508 $689,202 $497,784 $172,797 $2,191,291 \n\nYear ended March 31, 2025\n\nRevenueBrokerageBankingInsuranceOtherTotal\n\nKazakhstan$466,168 $506,075 $636,654 $94,822 $1,703,719 \n\nArmenia181,698 — — — 181,698 \n\nCyprus63,179 — — 6,311 69,490 \n\nUS3,431 — — 40,520 43,951 \n\nOther2,873 73 — 2,351 5,297 \n\nTOTAL REVENUE, NET$717,349 $506,148 $636,654 $144,004 $2,004,155 \n\nYear ended March 31, 2024\n\nRevenueBrokerageBankingInsuranceOtherTotal\n\nKazakhstan$450,058 $615,870 $325,505 $79,814 $1,471,247 \n\nCyprus115,878 — — 2,454 118,332 \n\nArmenia43,132 — — — 43,132 \n\nUS11,372 — — 1,470 12,842 \n\nOther1,514 — — 189 1,703 \n\nTOTAL REVENUE, NET$621,954 $615,870 $325,505 $83,927 $1,647,256 \n\n198\n\n[Table of Contents](#i70ff496d74d2478e8fff6b413c2fcd4c_7)\n\nFREEDOM HOLDING CORP.\n\nNOTES TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS MARCH 31, 2026\n\n(All amounts in thousands of United States dollars, except share data, unless otherwise stated)\n\nMarch 31, 2026\n\nLong-lived assetsBrokerageBankingInsuranceOtherTotal\n\nFixed assets, net$23,049 $89,083 $7,040 $239,224 $358,396 \n\nRight-of-use assets21,065 7,986 1,934 16,594 47,579 \n\nTOTAL LONG-LIVED ASSETS$44,114 $97,069 $8,974 $255,818 $405,975 \n\nKazakhstan15,124 95,288 8,974 219,533 338,919 \n\nCyprus12,371 — — 27,541 39,912 \n\nUSA3,640 — — 5,782 9,422 \n\nArmenia5,571 — — — 5,571 \n\nOther7,408 1,781 — 2,962 12,151 \n\nTOTAL LONG-LIVED ASSETS$44,114 $97,069 $8,974 $255,818 $405,975 \n\nMarch 31, 2025\n\nLong-lived assetsBrokerageBankingInsuranceOtherTotal\n\nFixed assets, net$20,713 $53,716 $2,461 $114,213 $191,103 \n\nRight-of-use assets21,101 7,684 2,532 8,511 39,828 \n\nTOTAL LONG-LIVED ASSETS$41,814 $61,400 $4,993 $122,724 $230,931 \n\nKazakhstan15,241 60,863 4,993 97,608 178,705 \n\nCyprus15,178 — — 21,791 36,969 \n\nUSA4,220 — — 2,389 6,609 \n\nArmenia6,082 — — — 6,082 \n\nOther1,093 537 — 936 2,566 \n\nTOTAL LONG-LIVED ASSETS$41,814 $61,400 $4,993 $122,724 $230,931 \n\nBrokerage\n\nCompanies in the Brokerage segment offer securities brokerage, securities dealing for customers and for our own account, market making activities, investment research, investment counseling, underwriting and market-making services to a global customer base of corporations, investors, financial institutions, merchants, government and municipal entities. Companies in the Brokerage segment also conduct proprietary securities trading.\n\nThe Group's services in this segment include providing customers with access to the world's largest stock exchanges and a gateway to global investment opportunities. Additionally, the Group's offerings in this segment include professional securities analytics, empowering customers with valuable insights and market intelligence to make informed investment decisions. To ensure a seamless experience, the Group provides user-friendly trading applications that offer convenience and flexibility.\n\nBanking\n\nCompanies in the Banking segment generate banking service fee and interest income by providing services that include lending, deposit services, payment card services, money transfers, correspondent accounts, supporting both individual and corporate customers with innovative digital financial solutions. To ensure a seamless experience, the Banking segment it\n\n199\n\n[Table of Contents](#i70ff496d74d2478e8fff6b413c2fcd4c_7)\n\nFREEDOM HOLDING CORP.\n\nNOTES TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS MARCH 31, 2026\n\n(All amounts in thousands of United States dollars, except share data, unless otherwise stated)\n\nprovides user-friendly trading applications that offer convenience and flexibility. Companies in the Banking segment also conduct proprietary securities trading activities.\n\nInsurance\n\nCompanies in the Insurance segment offer products including life insurance, obligatory insurance, tourist medical health insurance and auto insurance. These insurance products are designed to offer comprehensive coverage and tailored solutions to protect individuals, property, auto and businesses in the event of unforeseen events or risks. Companies in the Insurance segment also conduct proprietary securities trading activities.\n\nOther\n\nActivities of companies in the Other segment include provision of payment processing services, financial educational center services, financial intermediary center services, financial consulting services, administrative management services, telecommunication services information processing services, entertainment ticketing sales, online air and railway ticket purchase aggregation and an online retail trade and e-commerce application. The Other segment also includes transactions conducted by the Company in connection with repurchase agreements.\n\n200\n\n[Table of Contents](#i70ff496d74d2478e8fff6b413c2fcd4c_7)\n\nFREEDOM HOLDING CORP.\n\nNOTES TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS MARCH 31, 2026\n\n(All amounts in thousands of United States dollars, except share data, unless otherwise stated)\n\nNOTE 31 - STATUTORY CAPITAL REQUIREMENTS\n\nThe Company has two insurance subsidiaries operating in Kazakhstan: Freedom Life (a regulated life insurer) and Freedom Insurance (a regulated property and casualty insurance entity). The Law of the Republic of Kazakhstan No. 126-II \"On Insurance Activities\" (the \"Insurance Law\") is the main law regulating the insurance sector in Kazakhstan. It establishes a framework for insurance activities, registration and licensing of insurance companies and regulation of insurance activities by the Agency of the Republic of Kazakhstan for Regulation and Development of Financial Market (\"ARDFM\").\n\nFreedom Life and Freedom Insurance are required by ARDFM to notify it of any proposal to declare or pay a dividend on its share capital, and the ARDFM may, following the notification, decide to restrict such proposal. The amount of dividends these subsidiaries are permitted to declare is limited to the relevant subsidiary's realized retained earnings and dividends can only be paid to the extent they will not cause a breach to the minimum solvency and capital requirements of the relevant subsidiary. As of March 31, 2026 and March 31, 2025, Freedom Life and Freedom Insurance were in compliance with the ARDFM dividend, minimum solvency and minimum capital requirements. Freedom KZ in its capacity of an insurance holding is also limited in declaration and payment of dividends if such payment leads to breach of capital ratios applicable to Freedom Life and Freedom Insurance.\n\nThere are no significant differences between the statutory accounting practices and statements prepared in accordance with U.S. GAAP for the insurance subsidiaries.\n\nIn addition, our subsidiaries operate under various securities brokerage, banking and financial services regulations and must maintain such licenses in order to conduct their operations. As of March 31, 2026, we, through our subsidiaries, held: (a) brokerage licenses (i) in Kazakhstan issued by the NBK and the Astana Financial Services Authority (the \"AFSA\"), (ii) in Cyprus issued by the Cyprus Securities and Exchange Commission (\"CySEC\"), (iii) in the United States issued by FINRA, (iv) in Armenia issued by the Central Bank of Armenia, (v) in Uzbekistan issued by the Center of Coordination and Development of Securities Market, (vi) in Kyrgyzstan issued by the Financial Market Regulatory and Supervision Service under the Ministry of Economy and Сommerce of the Kyrgyz Republic, and (vii) in UAE issued by the Abu Dhabi Global Market Financial Services Regulatory Authority; (b) a banking license for foreign currency operations in Kazakhstan issued by the ARDFM; (c) banking licenses (i) in Kazakhstan for corporate and retail banking services issued by the ARDFM (including for currency exchange operations), and (ii) in Tajikistan issued by the National Bank of Tajikistan; (d) a payment service provider in Kazakhstan registered in such capacity with the NBK, payment services providers in Uzbekistan and Kyrgyzstan holding licenses from the Central Bank of Uzbekistan and the National Bank of the Kyrgyz Republic, respectively; and (e) a securities portfolio management license in Tajikistan issued by the Ministry of Finance of Tajikistan. Our U.S. broker-dealer subsidiary is subject to regulatory oversight by U.S. authorities, including the SEC and FINRA, with respect to its brokerage and investment advisory activities in the U.S. In addition, following receipt of a principal approval by the Türkiye's financial regulatory and supervisory authority granted on January 9, 2025, we are in the process of obtaining a license to provide brokerage services in Türkiye.\n\nThe table below presents net capital/eligible equity, required minimum capital, excess regulatory capital and retained earnings as of March 31, 2026 for the Company and each of subsidiaries that are regulated entities that is material for our consolidated financial statements.\n\n201\n\n[Table of Contents](#i70ff496d74d2478e8fff6b413c2fcd4c_7)\n\nFREEDOM HOLDING CORP.\n\nNOTES TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS MARCH 31, 2026\n\n(All amounts in thousands of United States dollars, except share data, unless otherwise stated)\n\nRegulated activitiesNet Capital/Eligible EquityRequired Minimum capital/solvencyExcess regulatory capitalRetained earnings\n\n(amounts in thousands)\n\nFreedom EU\nBrokerage\n$686,750 $19,509 $667,241 $522,253 \n\nFreedom Bank KZ\n\nBank\n518,891 231,143 287,747 286,195 \n\nFreedom Holding Corp.\n\nNon-regulated holding company\n1,489,279 200,000 1,289,279 1,231,500 \n\nFreedom Global\nBrokerage\n139,906 37,068 102,838 163,820 \n\nFreedom Life\nLife Insurance\n117,074 13,550 103,524 107,131 \n\nFreedom Armenia (\"Freedom AR\")\n\nBrokerage\n95,550 797 94,753 96,377 \n\nFreedom KZ\nBrokerage\n73,931 452 73,480 141,684 \n\nFreedom Insurance\nProperty and Casual Insurance\n59,373 13,550 45,822 34,432 \n\nOther regulated operating subsidiaries\nOther\n25,568 208523,483 (53,207)\n\n$3,206,322 $518,154 $2,688,167 $2,530,185 \n\nAccording to the requirements of the NBK, the regulator of Freedom KZ and Freedom Life, capital is adjusted through subtraction of non-liquid assets. Consequently, net capital for regulatory purposes may be lower than retained earnings balances. For the purposes of capital requirements applicable to Freedom EU, which is regulated by the CySEC and Freedom Global regulated by Astana Financial Services Authority, current year profit is not included within net capital for regulatory purposes, as profits can only be included in net capital after a statutory audit is completed.\n\nThe table below presents net capital/eligible equity, required minimum capital, excess regulatory capital and retained earnings as of March 31, 2025 for each of our subsidiaries that are regulated entities that is material for our consolidated financial statements.\n\nRegulated activitiesNet Capital/Eligible EquityRequired Minimum capital/solvencyExcess regulatory capitalRetained earnings\n\n(amounts in thousands)\n\nFreedom Holding Corp.\n\nNon-regulated holding company\n$526,906 $200,000 $326,906 $(256,096)\n\nFreedom EU\nBrokerage\n450,903 19,320 431,584 607,659 \n\nFreedom Bank KZ\n\nBank\n382,259 175,396 206,862 159,119 \n\nFreedom KZ\nBrokerage\n43,568 390 43,178 100,440 \n\nFreedom Global\nBrokerage\n66,217 21,564 44,653 56,941 \n\nFreedom Life\nLife Insurance\n58,246 11,692 46,554 70,574 \n\nFreedom Armenia (\"Freedom AR\")\n\nBrokerage\n47,994 773 47,221 48,067 \n\nFreedom Insurance\nProperty and Casual Insurance\n33,646 11,692 21,954 29,150 \n\nOther regulated operating subsidiaries\nOther\n14,130 26713,863 (28,622)\n\n$1,623,869 $441,094 $1,182,775 $787,232 \n\n202\n\n[Table of Contents](#i70ff496d74d2478e8fff6b413c2fcd4c_7)\n\nFREEDOM HOLDING CORP.\n\nNOTES TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS MARCH 31, 2026\n\n(All amounts in thousands of United States dollars, except share data, unless otherwise stated)\n\nNOTE 32 - SUBSEQUENT EVENTS\n\nThe Company has performed an evaluation of subsequent events through the date of issuance of these financial statements. During this period the Company did not have any material recognizable subsequent events.\n\n203"}