INDEPENDENT AUDITOR S REPORT

INDEPENDENT AUDITOR S REPORT To the Trustees of Franklin Templeton Mutual Fund Report on the Financial Statements We have audited the accompanying financial statements of Franklin India Cash Management Account ( the Scheme ) which comprise the Balance Sheet as at March 31, 2017 and also the Revenue Account and Cash Flow Statement for the year ended March 31, 2017, and a summary of significant accounting policies and other explanatory information. Management s Responsibility for the Financial Statements Management of Franklin Templeton Asset Management (India) Private Limited ( the Company ), the scheme s asset manager, is responsible for the preparation of the financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Scheme in accordance with accounting principles generally accepted in India, including the accounting policies and standards specified in the Ninth Schedule to the Securities and Exchange Board of India (Mutual Funds) Regulations, 1996 and amendments thereto ( the SEBI Regulations ). This responsibility includes the design, implementation and maintenance of internal control relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error. Auditor s Responsibility Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with the Standards on Auditing issued by the Institute of Chartered Accountants of India. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the Scheme s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances but not for the purpose of expressing an opinion on the effectiveness of entity s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion. Opinion In our opinion and to the best of our information and according to the explanations given to us, the financial statements give the information required by the SEBI Regulations in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India: (a) in the case of the Balance Sheet, of the state of affairs of the Scheme as at the March 31, 2017; (b) in the case of the Revenue Account, of the surplus for the year ended March 31, 2017; and (c) in the case of the Cash Flow Statement, of the cash flows for the year ended March 31, 2017.

Report on Other Legal and Regulatory Requirements 1. As required by Regulation 55(4) and clause 5(ii)(2) of the Eleventh Schedule of the Regulations, we report that: a. We have obtained all the information and explanations, which to the best of our knowledge and belief were necessary for the purposes of our audit. b. The balance sheet, revenue account and cash flow statement dealt with by this report are in agreement with the books of account. c. In our opinion, the balance sheet and revenue account dealt with by this report have been prepared in conformity with the accounting policies and standards specified in the Ninth Schedule to the SEBI Regulations. 2. In our opinion, and on the basis of information and explanations given to us, the methods used to value non traded securities as at March 31, 2017 are in accordance with the SEBI Regulations and other guidelines issued by the Securities and Exchange Board of India, as applicable, and approved by the Board of Directors of Franklin Templeton Trustees Private Limited ( Trustees ), and are fair and reasonable. For S.R. BATLIBOI & CO. LLP Chartered Accountants ICAI Firm Registration Number: 301003E / E300005 Sd/ per Viren H. Mehta Partner Membership No.: 048749 Place: Mumbai Date: 07 July, 2017

BALANCE SHEET AS AT MARCH 31, 2017 (All amounts in thousands of Rupees) SOURCES OF FUNDS Schedules FRANKLIN INDIA CASH MANAGEMENT ACCOUNT As at As at March 31, 2017 March 31, 2016 1 Unit Capital 2(b) & 3 760,337 381,214 2 Reserves and Surplus 4 2.1 Unrealised Appreciation Reserve 119 381 2.2 Retained Surplus 627,491 214,197 3 Current Liabilities and Provisions 5 3.1 Current Liabilities 13,123 6,328 TOTAL 1,401,070 602,120 APPLICATION OF FUNDS 1 Investments 2(c), 6 & 16 1.1 Listed Securities 1.1.1 Other Debentures and Bonds 316,743 1.2 Commercial Papers 703,958 202,894 1.3 Certificate of Deposits 227,957 376,379 3 Other Current Assets 7 3.1 Cash and Bank Balances 8,731 5,205 3.2 CBLO/ Reverse Repo Lending 100,510 2,574 3.3 Others 33,790 5,583 4 Accumulated Unit Discount, Net 8 9,381 9,485 TOTAL 1,401,070 602,120 Notes to Accounts 1 to 16 The accompanying schedules are an integral part of this Balance Sheet. As per our attached report of even date For S.R. Batliboi & Co. LLP For Franklin Templeton Trustee For Franklin Templeton Asset Management ICAI Firm Registration No.: 301003E/E300005 Services Private Limited (India) Private Limited Chartered Accountants Sd/ Sd/ Sd/ Sd/ per Viren H. Mehta Anand J. Vashi Deepak Satwalekar S. Jayaram Partner Membership No. 048749 Director Director Director Membership No. 048749 Sd/ Sd/ Sd/ Alok Sethi Sanjay Sapre Ajay Narayan Director President Vice President Sd/ Umesh Sharma Vice President & Portfolio Manager Fixed Income Mumbai Sd/ Pallab Roy Assistant Vice President & Portfolio Manager Fixed Income Sd/ Santosh Kamath Managing Director & Chief Investment Officer Fixed Income

REVENUE ACCOUNT FOR THE YEAR ENDED MARCH 31, 2017 (All amounts in thousands of Rupees) Schedules FRANKLIN INDIA CASH MANAGEMENT ACCOUNT Year ended Year ended March 31, 2017 March 31, 2016 1 INCOME 1.1 Interest 2(d), 9 69,350 105,527 1.2 Realised Gain on Interscheme Sale of Investments, net 2(d) 32 124 1.3 Realised Gain on External Sale / Redemption of Investments, net 2(d) 348 232 1.4 Change in Unrealised Appreciation in the value of Investments (262) 23 69,468 105,906 2 EXPENSES 2.1 Management Fees 10 2,380 6,537 2.2 Service Tax on Management Fees 10 357 890 2.3 Transfer Agents Fees and Expenses 296 353 2.4 Custodian Fees 13 16 2.5 Trusteeship Fees 10 31 47 2.6 Commission to Agents 5,940 8,268 2.7 Marketing and Distribution Expenses 177 104 2.8 Investor Education Expenses 2(g) 204 312 2.9 Audit Fees 13 16 2.10 Change in Unrealised Depreciation in value of Investments 2(c) & 6(ii) (92) 2.11 Other Operating Expenses 41 82 9,452 16,533 3 NET INCOME AS PER REVENUE ACCOUNT 60,016 89,373 4 Transfer from Retained Surplus 4 214,197 258,419 5 Add: Balance Transfer from Unrealised Appreciation Reserve 4 381 358 6 Less: Balance Transfer to Unrealised Appreciation Reserve 4 119 381 7 Add / (Less): Equalisation Credit/(Debit) 2(e) 367,762 (73,604) 8 Total 642,237 274,165 9 Dividend Appropriation 9.1 Income Distributed during the year 14 (10,554) (41,527) 9.2 Tax on Income Distributed during the year 14 (4,192) (18,441) 10 NET SURPLUS / (DEFICIT) FOR THE YEAR TRANSFERRED 4 627,491 214,197 (7+8) TO BALANCE SHEET Notes to Accounts 1 to 16 The accompanying schedules are an integral part of this Revenue Account. For S.R. Batliboi & Co. LLP For Franklin Templeton Trustee For Franklin Templeton Asset Management ICAI Firm Registration No.: 301003E/E300005 Services Private Limited (India) Private Limited Chartered Accountants Sd/ Sd/ Sd/ Sd/ per Viren H. Mehta Anand J. Vashi Deepak Satwalekar S. Jayaram Partner Membership No. 048749 Director Director Director Membership No. 048749 Sd/ Sd/ Sd/ Alok Sethi Sanjay Sapre Ajay Narayan Director President Vice President Sd/ Umesh Sharma Vice President & Portfolio Manager Fixed Income Mumbai Sd/ Pallab Roy Assistant Vice President & Portfolio Manager Fixed Income Sd/ Santosh Kamath Managing Director & Chief Investment Officer Fixed Income

CASH FLOW STATEMENT FOR THE YEAR ENDED MARCH 31, 2017 (All amounts in thousands of Rupees) FRANKLIN INDIA CASH MANAGEMENT ACCOUNT March 31, 2017 March 31, 2016 A. Cashflow from operating activities Surplus for the period before equalisation and income distribution. 60,016 89,373 Add / (Less) :Change in Unrealised Apreciation in value of Investments 262 (23) Add / (Less) : Change in Unrealised Depreciation in value of Investments (92) Add / (Less) :Amortization of premium / discount on investment cost (53,643) (58,158) Adjustments for: (Increase)/Decrease in Investments at cost (616,004) 514,229 (Increase)/Decrease in Other current assets (28,005) 22,425 Increase/(Decrease) in Current liabilities 451 (1,128) Net cash generated from/(used in) operations ( A ) (636,923) 566,626 B Cashflow from financing activities Increase/(Decrease) in Unit capital 368,636 (1,890,451) Increase/(Decrease) in Unit premium 367,854 (74,135) Adjustments for: Increase/(Decrease) in Sundry creditors for units redeemed by investors / Advance money received, Units pending allotment 3,577 (151,349) (Increase)/Decrease in Sundry debtors for units issued to investors /Advance money paid, Units pending redemption (200) 1,078,079 Dividend paid during the period (including dividend tax) (4,250) (18,526) Increase/(Decrease) in units pending allotment 2,768 4,912 Net Cash (used in)/generated from Financing Activities ( B ) 738,385 (1,051,470) Net Increase/(Decrease) in Cash and Cash Equivalents (A+B) 101,462 (484,844) Cash and Cash Equivalents as at the beginning of the year 7,779 492,623 Cash and Cash Equivalents as at the end of the year 109,241 7,779 Components of cash and cash equivalents Balances with Banks in Current Accounts * 109,241 7,779 Deposits with scheduled banks 109,241 7,779 As per our attached report of even date *Includes CBLO and Reverse repo balances and balances in unclaimed redemption / dividend bank account held towards unclaimed redemption / dividend liabilities of the Scheme. For S.R. Batliboi & Co. LLP For Franklin Templeton Trustee For Franklin Templeton Asset Management ICAI Firm Registration No.: 301003E/E300005 Services Private Limited (India) Private Limited Chartered Accountants Sd/ Sd/ Sd/ Sd/ per Viren H. Mehta Anand J. Vashi Deepak Satwalekar S. Jayaram Partner Membership No. 048749 Director Director Director Membership No. 048749 Sd/ Sd/ Sd/ Alok Sethi Sanjay Sapre Ajay Narayan Director President Vice President Sd/ Umesh Sharma Vice President & Portfolio Manager Fixed Income Mumbai Sd/ Pallab Roy Assistant Vice President & Portfolio Manager Fixed Income Sd/ Santosh Kamath Managing Director & Chief Investment Officer Fixed Income

(All amounts in thousands of Rupees unless specified otherwise) 1. BACKGROUND Franklin Templeton Mutual Fund ( the Fund ) was established as a trust under the Indian Trusts Act, 1882, by way of a trust deed dated January 4, 1996, a supplementary trust deed dated March 30, 1996 and August 26, 2005 executed by Templeton International Inc. USA, the sponsor of the Fund. Templeton International Inc. is a part of the Franklin Templeton Investments group. In accordance with the Securities and Exchange Board of India ( SEBI ) (Mutual Funds) Regulations, 1996 ( the SEBI Regulations ), the Board of Directors of Franklin Templeton Trustee Services Private Limited ( the Trustee ) has appointed Franklin Templeton Asset Management (India) Private Limited ('the AMC') to manage the Fund s affairs and operate its Schemes. The objective and other feature of the schemes covered in the financial statement are as under: Scheme Name Nature of the Scheme Date of Allotment Scheme Objective Plans Offered Franklin India Cash Management Account Open Ended Mutual Fund Scheme April 23, 2001 The primary objective of the Scheme is to The Scheme offers its investors Growth Plan and Dividend provide income and liquidity consistent with Plan ('the Plans'). Dividend Plan was launched in November the prudent risk from a portfolio comprising of 2001, with a view to declare periodic dividends. The dividend money market and debt instruments. declared in the Dividend Plan is compulsorily reinvested back into the plan at the exdividend Net Asset Value and additional units are allotted to the unitholders of the Dividend Plan. Effective January 1, 2013, in accordance with SEBI Circular no. CIR/IMD/DF/21/2012 dated September 13, 2012, the Scheme introduced a new Plan under each of the Existing plan / option, termed as Direct. 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The financial statements are prepared on the accrual basis of accounting, under the historical cost convention, as modified for investments, which are markedtomarket. These financial statements are prepared in accordance and conformity with the accounting policies and standards specified in the Ninth Schedule to the Securities and Exchange Board of India (Mutual Funds) Regulations, 1996. The significant accounting policies, which are in accordance with the SEBI Regulations and have been approved by the Board of Directors of the AMC and the Trustee, are stated below. (a) Determination of net asset value The net asset value of the units of the Scheme is determined separately for units issued under the Plans after including the respective unit capital and reserves and surplus, and reducing net deficit and accumulated discount, if any. (b) For reporting the net asset values, the daily income earned, including realised profit or loss and unrealised gain or loss in the value of investments, and expenses incurred by the Scheme, are allocated to the Plans in proportion to their respective daily net assets as at the end of the immediately preceding day. Commission expenses are not allocated to the Direct Plans/ Options. Unit capital Unit capital represents the net outstanding units at the balance sheet date, thereby reflecting all transactions relating to the period ended on that date. (c) Upon issue and redemption of units, the net premium or discount to the face value of units is adjusted against the unit premium reserve of the Scheme, after an appropriate portion of the issue proceeds and redemption payouts is credited or debited respectively to the equalisation account, a mandatory requirement for open ended mutual fund Schemes. Investments Accounting for investment transactions Valuation Of Fixed Income Securities Purchase and sale of investments are recorded on the date of the transaction, at cost and sale price respectively, after considering brokerage, commission, securities transaction tax and fees payable or receivable, if any. The front end fee receivable, if any, is reduced from the cost of investment. In terms of SEBI circular no. CIR/IMD/DF/21/2012 dated September 13, 2012, brokerage and transaction costs (including all taxes) incurred for the purpose of execution of trade in excess of 0.12% in case of cash market transaction is charged to the Total Expense Ratio of the fund. All Debt securities (except for Zero Coupon Bonds, Government Securities and Treasury Bills), with residual maturity greater than 60 days, on the valuation date, are valued at the weighted average price obtained from CRISIL and ICRA (agency(ies) appointed/ designated for the said purpose by the Association of Mutual Funds of India {AMFI}). Effective January 1, 2016, if price for New security purchased is not available from CRISIL and ICRA, the security will be valued at weighted average traded price available on public platform (namely FIMMDA, NSE and BSE), provided there is at least one trade of Rs.5 crores or more for Bonds and at least one trade of Rs. 25 crores or more for Money Market Instruments as against the earlier practice of valuing at weighted average price available on public platform (namely FIMMDA, NSE WDM, BSE ICDM), provided there are at least two trades aggregating to Rs. 25 crores or more for debt securities with residual maturity of greater than 365 days on the valuation date and at least three trades aggregating to Rs. 100 crores or more for debt securities with residual maturity greater than 60 days and less than or equal to 365 days on the valuation date. Effective June 3, 2016 all Debt securities (except for Zero Coupon Bonds, Government Securities and Treasury Bills), with residual maturity upto 60 days on the date of valuation, which are traded on the valuation date, are valued at the weighted average traded price available on the public platform (namely FIMMDA,NSE and BSE), provided there are at least three trades aggregating to Rs 100 crores or more. Outlier trades, if any, are excluded based on suitable justification. Prior to June 3, 2016 and effective from January 1, 2016the same were being valued at the weighted average traded price available on the public platform (namely FIMMDA, NSE and BSE), provided there was at least one trade of Rs. 5 crores or more for Bonds and at least one trade of Rs 25 crores or more for Money Market Instrument as against the earlier practice of valuing at weighted average price available on public platform (namely FIMMDA, NSE WDM, BSE ICDM) provided there were at least three trades aggregating to Rs.100 crores or more. When such securities are not traded on a particular valuation day, they are valued on amortisation basis. Effective June 3, 2016, in case the variance between the amortised price and the reference price exceeds plus/ minus 0.10%, the valuation is adjusted to bring it within the band of +/0.10% as against the earlier practice of considering reference price for valuation and this change has no impact during the period. Reference price is the price derived from risk free benchmark yields plus/ minus spread. The securities with call option are valued at the lower of the value as obtained by valuing the security to final maturity and valuing the security to call option. In case there are multiple call options, the lowest value obtained by valuing to the various call dates and valuing to the maturity date is taken as the value of the instrument. The securities with put option are valued at the higher of the value as obtained by valuing the security to final maturity and valuing the security to put option. In case there are multiple put options, the highest value obtained by valuing to the various put dates and valuing to the maturity date is taken as the value of the instruments.

(All amounts in thousands of Rupees unless specified otherwise) Investment in Zero Coupon Bonds with residual maturity greater than 60 days, on the valuation date, are valued at the weighted average price obtained from CRISIL and ICRA (agency(ies) appointed/ designated for the said purpose by AMFI). Effective from January 1, 2016, if price for New security purchased is not available from CRISIL and ICRA, the security will be valued at weighted average traded price available on public platform (namely NSE and BSE), provided there is at least one trade of Rs. 5 crores or more. Prior to January 1, 2016, if the price of Zero Coupon Bond was not available from CRISIL and ICRA, the security was valued at weighted average traded yield available on public platform (namely FIMMDA, NSE WDM and BSE ICDM ) as per qualification criteria as mentioned below: (a ) Maturity greater than 60 days and less than or equal to 365 days there were at least three trades aggregating to Rs. 100 crores or more. (b) Maturity greater than 365 days at least two trades aggregating to Rs. 25 crores or more. Effective June 3, 2016 Investment in Zero Coupon Bonds with residual maturity upto 60 days on the date of valuation, which are traded on the valuation date, are valued at the weighted average traded price available on the public platform (namely NSE and BSE), provided there are at least three trades aggregating to of Rs. 100 crores or more. Outlier trades, if any, are excluded based on suitable justification. Prior to June 3, 2016 and effective from January 1, 2016, investment in Zero Coupon Bonds with residual maturity upto 60 days on the date of valuation, if traded were valued at the weighted average traded price available on the public platform (namely NSE and BSE), provided there was at least one trade of Rs. 5 crores or more as against the earlier practice of valuing at the weighted average traded yield available on the public platform (namely FIMMDA, NSE WDM and BSE ICDM), for the trade criteria of at least three trades aggregating to Rs. 100 crores or more. When such securities are not traded on a particular valuation day, they are valued on amortisation basis. Effective from June 3, 2016 In case the variance between the amortised price and the reference price exceeds plus/ minus 0.10%, the valuation is adjusted to bring it within the band of +/0.10% as against the earlier practice of considering the reference price for valuation and this change has no impact during the period. Reference price is the price derived from risk free benchmark yields plus/ minus spread. Effective June 3, 2016, Investment in Government Securities and Treasury Bills with residual maturity up to 60 days on the date of valuation, which are traded on the valuation date, are valued at the weighted average traded price available on the public platform namely CCIL provided there are at least three trades aggregating to of Rs.100 crores or more. Outlier trades, if any, are excluded based on suitable justification. Prior to June 3, 2016 and effective from January 1, 2016, Investment in Government Securities and Treasury Bills with residual maturity up to 60 days on the date of valuation, which are traded on the valuation date, are valued at the weighted average traded price available on the public platform namely CCIL provided there was at least one trade aggregating to Rs. 5 crores or more for Bonds and at least one trade of Rs 25 crores or more for Money Market Instrument as against the earlier practice of weighted average traded price available on the public platform namely CCIL provided there were at least three trades aggregating to Rs. 100 crores or more. When such securities are not traded on a particular valuation day, they are valued on amortisation basis. The amortised price is used as long as it is within plus/ minus 0.10% of the reference price. Effective from June 3, 2016, in case the variance between the amortised price and the reference price exceeds plus/ minus 0.10%, the valuation is adjusted to bring it within the band of +/0.10% as against the earlier practice of considering reference price for valuation and this change has no impact during the period. Reference price is the price derived from risk free benchmark yield plus/ minus spread. Investment in Government Securities and Treasury Bills with residual maturity greater than 60 days on the date of valuation are valued based on the average of the prices provided by the CRISIL and ICRA(agency(ies) entrusted for the said purpose by AMFI). (d) All other investments are stated at their fair value as determined in good faith by the AMC in accordance with the SEBI Regulations and reviewed by the Trustee. The net unrealised gain or loss in the value of investments is determined separately for each category of investments. The change in the net unrealised loss, if any, between two balance sheet dates is recognised in the revenue account and the change in net unrealised gain, if any, is adjusted in an unrealised appreciation reserve. The loss on investments sold/transferred during the year is charged to the revenue account. Revenue recognition Interest on fixed income securities is recognised as income on an accrual basis. Profit or loss on sale of investments is determined on the basis of the weighted average cost method. The discount or premium, if any, to the redemption value of debt securities is amortised and recognised as interest income or expense, as the case may be, over the period to redemption. (e) Equalisation account The purpose of equalization account is to maintain per unit amount of a Plan s/option s share of the Scheme s undistributed income, so that continuing unit holders share of undistributed income remains unchanged on issue or redemption of units under that Plan/Option. Pursuant to SEBI circular dated March 15, 2010, the Trustee/AMC has changed the method of calculating equalization per unit w.e.f. that date viz: a) When the sale price is higher than the face value of the unit, the total accumulated undistributed income (including realized gains) till the date of the transaction is determined. Based on the number of units outstanding on the transaction date, the undistributed income (including realized gains) associated with each unit is computed. The per unit amount so determined is credited and debited to the equalization account on issue and redemption of each unit respectively. b) When the sale price is lower than the face value of the unit, the difference between the Net asset value and the par value is debited and credited to the equalization account on issue and redemption of unit respectively. (f) Load charges Load charged upto 1% at the time of redemption of units prior to October 1, 2012 and Load charged at the time of purchase of units, wherever applicable, are being utilised towards meeting distribution and marketing expenses. In accordance with the SEBI Circular no. CIR/IMD/DF/21/2012 dated September 13, 2012, entire amount of Exit load collected is credited to the respective scheme In accordance with the SEBI Circular no. CIR/IMD/DF/21/2012 dated September 13, 2012, entire amount of Exit load/ CDSC collected is credited to the respective scheme net of taxes as "Other Income". Unutilised amount of load is carried forward to subsequent period. If the amount is considered in excess by the AMC / Trustees, then such excess amount is credited to the respective Schemes as Other Income. (g) Investor education and awareness initiatives In accordance with SEBI Circular no. CIR/IMD/DF/21/2012 dated September 13, 2012, the fund is accruing 0.02% p.a. on daily net assets towards investor education and awareness initiatives. Unutilised amount is carried forward to the subsequent period. Interest earned, if any, by investment of unutilized amount in Fixed deposits, is credited to the Investor Education Liability. (THIS SPACE HAS BEEN INTENTIONALLY LEFT BLANK)

SCHEDULE TO THE BALANCE SHEET AND REVENUE ACCOUNT FOR THE YEAR ENDED MARCH 31, 2017 (All amounts in thousands of Rupees) FRANKLIN INDIA CASH MANAGEMENT ACCOUNT Schedules March 31, 2017 March 31, 2016 March 31, 2017 March 31, 2016 Quantity Amount 3 UNIT CAPITAL Units of Rs 10 each fully paid up Growth Plan Outstanding, beginning of year 14,866,776.821 20,963,174.365 148,671 209,634 Issued During the year 124,490,940.740 341,866,958.161 1,244,909 3,418,670 Redeemed during the year (100,570,107.186) (347,963,355.705) (1,005,701) (3,479,633) Outstanding, end of year 38,787,610.375 14,866,776.821 387,879 148,671 Dividend Plan Outstanding, beginning of year 22,419,256.483 202,045,648.999 224,190 2,020,454 Issued During the year 70,740,182.717 1,704,730,519.337 707,402 17,047,305 Redeemed during the year (61,299,820.980) (1,884,356,911.853) (612,998) (18,843,569) Outstanding, end of year 31,859,618.220 22,419,256.483 318,594 224,190 Direct Growth Plan Outstanding, beginning of year 656,736.465 2,711.441 6,567 27 Issued During the year 6,748,487.402 2,473,537.070 67,485 24,735 Redeemed during the year (4,026,602.208) (1,819,512.046) (40,266) (18,195) Outstanding, end of year 3,378,621.659 656,736.465 33,786 6,567 Direct Dividend Plan Outstanding, beginning of year 178,584.953 5,756.260 1,786 58 Issued During the year 2,989,343.987 205,997.710 29,893 2,060 Redeemed during the year (1,160,063.869) (33,169.017) (11,601) (332) Outstanding, end of year 2,007,865.071 178,584.953 20,078 1,786 Total Outstanding, beginning of year 38,121,354.722 223,017,291.065 381,214 2,230,173 Issued During the year 204,968,954.846 2,049,277,012.278 2,049,689 20,492,770 Redeemed during the year (167,056,594.243) (2,234,172,948.621) (1,670,566) (22,341,729) Outstanding, end of year 76,033,715.325 38,121,354.722 760,337 381,214 (THIS SPACE HAS BEEN INTENTIONALLY LEFT BLANK)

FRANKLIN INDIA CASH MANAGEMENT ACCOUNT Schedules March 31, 2017 March 31, 2016 4. RESERVES AND SURPLUS Unrealised appreciation reserve Balance, beginning of year 381 358 Change in net unrealised appreciation in value of investments (262) 23 Balance, end of year 119 381 Retained surplus Balance, beginning of year 214,197 258,419 Transfer to Revenue Account (214,197) (258,419) Net surplus transferred from revenue account 627,491 214,197 Balance, end of year 627,491 214,197 Total reserves and surplus 627,610 214,578 5. CURRENT LIABILITIES AND PROVISIONS Current Liabilities Management fees 528 457 Trusteeship fees 3 1 Registrar service charges 31 11 Sundry creditors for units redeemed by investors 3,911 334 Dividend payable 34 38 Investor Education Liability 72 249 Units pending allotment 7,680 4,912 Other current liabilities 864 326 13,123 6,328 6. INVESTMENTS (i) (ii) The investments of the Scheme are registered in the name of the Fund for the benefit of the Scheme's unitholders. Aggregate appreciation and depreciation in the value of investments are as follows: (iii) (iv) Listed debentures and bonds / Awaiting listing on Stock Exchanges Listed Securities / Securities Awaited Listing: (Equity linked debentures / Other debentures and bonds / Securitised debt securities) appreciation 101 depreciation 4 Money Market Instruments (Commercial papers / Certificate of deposits) appreciation 46 410 depreciation 24 29 The aggregate value of investments purchased and sold by the Scheme during the year and these amounts as a percentage of average daily net assets are as follows: Purchases amount 7,616,184 12,602,179 as a percentage of average daily net assets 747.77 804.80 Sales amount 859,914 1,995,342 as a percentage of average daily net assets 84.43 127.43 Amount of Debentures and bonds Listed/ Awaiting listing on Stock Exchanges not traded as on the date of financial statement. 316,743

FRANKLIN INDIA CASH MANAGEMENT ACCOUNT Schedules March 31, 2017 March 31, 2016 (v) During the year, the Scheme has invested in the equity shares / debentures and bonds of certain companies, which have invested in some of the schemes of the Fund in excess of five percent of those schemes' Net Assets. The Scheme's investments in these companies (except for investments in subsidiaries of these companies) as at March 31, 2017 are provided in Annexure 1. (vi) These investments have been made on account of their value at the related prices and are in accordance with the investment objectives of the Scheme. The Scheme made investments in the Pass Through Certificates ('PTCs'). PTCs are issued by Special Purpose Vehicles ('SPVs') to whom the Obligator (the seller) has assigned single loans/ pool of loans in the Securitization process. The SPVs are set up in the form of a Trust. In respect of certain such Trusts, Income Tax Authorities ( Tax Authorities ) initiated scrutiny proceedings in respect of the AY 200910 and AY 201011. The Tax Authorities passed assessment orders and consequential demand notices to such Trusts and contended that the interest received by such Trust (SPVs) from the loans is taxable under the head 'Profits & gains from Business and Profession', at the maximum marginal rate. The Trustees of such trusts filed an appeal against such orders/ notices with the first Appellate authority. Since the relevant Trusts did not pay the demand raised by the Tax Authorities, the Tax Authorities initiated recovery proceedings against the Fund and sent demand notices to the Fund. In response to the recovery proceedings, the Fund filed Writ Petitions in the Honorable High Court of Bombay seeking direction by the Court to the tax authorities to follow the due process of Law and not take any coercive measures against the Fund for the recovery of the tax demand. The Honorable High Court disposed of the Writ Petitions of the Fund by ordering the Tax Authorities not to take any coercive action against the Fund pending the hearing and the final disposal of the Appeals filed by the relevant Trust before the first Appellate authority and for a period of six weeks thereafter to enable the fund to seek recourse to its remedies against the order of the first Appellate Authority, if necessary. Subsequently, the first Appellate authority disposed of the Appeal filed by the relevant Trusts for Assessment year 20092010 and for most of the Trusts for Assessment year 20102011. The first Appellate authority had partly upheld the contention of the Tax Authorities with an enhancement in case of some Trusts. In all the cases disposed by the first Appellate authority, the relevant Trusts were in Appeal against such orders with the Income Tax Appellate Tribunal (ITAT). Recently, the ITAT dismissed the contentions/ appeal of the Tax Authorities/ Revenue for Assessment year 20092010 and for most of the Trusts for Assessment year 20102011, thereby ruling in favor of the Trusts. Till date, the Tax Authorities/ Revenue have not filed an appeal against the order passed by the ITAT. The Fund in consultation with its tax advisors has carried out the analysis of the situation and has assessed the possibility of the event resulting into tax liability to be remote. Accordingly, no adjustments have been carried out in the financial statements of the Schemes in this regard. 7. OTHER CURRENT ASSETS Cash and Bank Balance Balances with banks in current accounts 8,731 5,205 CBLO/ Reverse Repo Lending Collateralised lending/reverse repo 100,510 2,574 Others Sundry debtors for units issued to investors 4,433 4,232 Outstanding and accrued income 26,772 34 Advances and deposits 2 1 Margin money 2,583 1,316 8,731 5,205 100,510 2,574 33,790 5,583 TOTAL 143,031 13,362 8. ACCUMULATED UNIT DISCOUNT, NET Balance, beginning of year 9,485 8,989 Net premium on ( issue) / redemption of units (104) 496 Balance, end of year 9,381 9,485 9. INTEREST On Debentures and bonds 62,057 62,328 On Collateralised lending / Reverse repo 7,192 36,055 On Fixed deposits 101 7,144 Total Gross Interest 69,350 105,527

FRANKLIN INDIA CASH MANAGEMENT ACCOUNT Schedules March 31, 2017 March 31, 2016 10. INCOME AND EXPENDITURE The total income and expenditure and these amounts as a percentage of the Scheme s average daily net assets on an annualised basis are provided below: Income amount 69,730 105,883 as a percentage of average daily net assets 6.85 6.76 Expenditure amount 9,452 16,625 as a percentage of average daily net assets Regular Plan 0.95 1.07 Direct Plan 0.33 0.16 Management fees (including service tax) amount 2,737 7,427 as a percentage of average daily net assets Regular Plan 0.27 0.48 Direct Plan 0.24 0.04 Trusteeship fees (including service tax) amount 31 47 as a percentage of average daily net assets 0.003 0.003 12. NET ASSET VALUE Net asset value of each unit of Rs. 10 of the Scheme Growth Plan (Rs) 24.5826 23.1666 Direct Growth Plan (Rs) 25.4346 23.8126 Dividend Plan (Rs) 10.0127 10.0108 Direct Dividend Plan (Rs) 10.0102 10.0095 13. SEGMENT REPORTING The scheme operates only in one segment viz. to primarily generate returns, based on schemes' investment objective. 14. INCOME DISTRIBUTION: In case where the Surplus / (Deficit) for the year (after adjustment of income equalisation) is lower than the amount of distributed income (including tax on income distributed), the income has been distributed by the Scheme to its unitholders out of the distributable surplus available with the Scheme, which consists of the Surplus / (Deficit) for the year (after adjustment of income equalisation) and the retained earnings / accumulated reserves of earlier year (s). 15. PRIOR YEAR COMPARATIVES Prior year amounts have been reclassified, wherever applicable, to conform to the current year's presentation. (THIS SPACE HAS BEEN INTENTIONALLY LEFT BLANK)

11. RELATED PARTY DISCLOSURES The Scheme has entered into transactions with certain related parties. The information required in this regard in accordance with Accounting Standard 18 on Related Party Disclosures issued by the ICAI and Regulation 25(8) of the SEBI Regulations, is provided below. (i) Related party relationships Name Description of relationship Franklin Resources Inc Templeton Worldwide Inc (TWI) USA Templeton International Inc, USA Franklin Templeton Capital Holdings Pte Limited (Singapore) Franklin Templeton Asia Holdings Pte Limited (Singapore) Franklin Templeton Holding Limited, Mauritius Franklin Templeton Asset Management (India) Private Limited Franklin Templeton Trustee Services Private Limited b) Other Related Parties with whom transactions have taken place during the period Mywish Market Places Pvt Ltd Ultimate holding Company of the sponsor Holding Company of the Sponsor Sponsor of the Fund Subsidiary of the Sponsor SubSubsidiary of the Sponsor Holding Company of the Scheme's Asset Manager./ SubSubsidiary of the Sponsor Scheme's asset manager./ Subsubsidiary of the Sponsor Trustee of the Fund Associate of the Scheme's Asset Manager Schemes of the Fund, under common control of the Sponsor Franklin Asian Equity Fund Franklin Build India Fund Franklin India Balanced Fund Franklin India Banking & PSU Debt Fund Franklin India BlueChip Fund Franklin India Corporate Bond Opportunities Fund Franklin India Dynamic Accrual Fund Franklin India Dynamic PE Ratio Fund Of Funds Franklin India Feeder Franklin European Growth Fund Franklin India Feeder Franklin U.S. Opportunities Fund Franklin India Flexi Cap Fund Franklin India Government Securities Fund Composite Plan & PF Plan Franklin India Government Securities Fund Long Term Plan Franklin India High Growth Companies Fund Franklin India Income Builder Account Franklin India Income Opportunities Fund Franklin India Index Fund Nifty Plan Franklin India Life Stage Fund of Funds Franklin India Low Duration Fund Franklin India Monthly Income Plan Franklin India MultiAsset Solution Fund Franklin India Opportunities Fund Franklin India Pension Plan Franklin India Prima Fund Franklin India Prima Plus Franklin India Savings Plus Fund Franklin India Short Term Income Plan Franklin India Smaller Companies Fund Franklin India Taxshield Franklin India Treasury Management Account Franklin India Ultra Short Bond Fund Franklin India Fixed Maturity Plans Series 1 Plan A (1108 Days) Franklin Infotech Fund Templeton India Equity Income Fund Templeton India Growth Fund (ii) Transactions, if any, with the above mentioned related parties as defined under Accounting Standard 18 and Regulation 25(8) of the SEBI Regulations are provided below Franklin India Cash Management Account Name of related party Nature of transactions Year Ended 2017 Balance as at March 31, 2017 Year ended 2016 Balance as at March 31, 2016 Schemes under common control Purchase of investments 2,730,520 7,282,799 Franklin India Treasury Management Account 1,398,915 5,044,465 Franklin India Ultra Short Bond Fund 619,353 1,037,197 Franklin India Low Duration Fund 214,928 349,923 Franklin India Banking & PSU Debt Fund 169,182 297,007 Franklin India Corporate Bond Opportunities Fund 136,863 49,147 Franklin India Income Opportunities Fund 81,565 Franklin India Short Term Income Plan 59,732 Franklin India Savings Plus Fund 49,982 485,267 Franklin India Balanced Fund 19,793 Sale of investments 407,308 686,909 Franklin India Treasury Management Account 238,064 686,909 Franklin India Ultra Short Bond Fund 99,696 Franklin India Banking & PSU Debt Fund 39,907 Franklin India Income Builder Account 29,641 Franklin Templeton Trustee Services Private Limited Fees for trusteeship services 31 3 47 1 Franklin Templeton Asset Management (India) Private Limited Registrar service charges 296 31 353 11 Fees for management services 2,737 528 7,427 457 Franklin Templeton Asset Management (India) Private Limited Investment in the Plan Direct Dividend Plan Subscriptions 3.18 3.21 Redemptions Net Asset Value of investment at Balance Sheet date 63 60 Investment in the Plan Direct Growth Plan Subscriptions 5,000 Redemptions Net Asset Value of investment at Balance Sheet date 5,768 5,400 Mywish Market Places Pvt Ltd $ Commission for distribution of the Scheme's units (#) 0.00^* ^ Less than Rs. 1000 # The commission is at rates similar to those offered to other distributors by the scheme. *This represents the amount paid / payable for the year and does not necessarily reflect the amount charged to the Scheme's Revenue Account. $ Associate with effect from March 11, 2017

16. SUPPLEMENTARY INVESTMENT PORTFOLIO INFORMATION AND INDUSTRYWISE CLASSIFICATION Details of investment portfolio and industrywise classification of the Scheme's investments in each category of investments as at March 31, 2016 are presented below. The category and company exposures are stated as a percentage of the Scheme's net assets as at March 31, 2016, as well as the aggregate investments in each investment category. Franklin India Cash Management Account Company Particulars Quantity Amount Percentage to Net Assets Percentage to Investment Category Debt Instruments Listed/Awaiting listing on Stock Exchanges 282 316,743 22.97 100.00 9.74% Dewan Housing Finance Corp. Ltd. (09Jun2017) ** 70 70,395 5.11 22.22 11.00% Tata Teleservices Ltd. (28Jun2017) ** 60 60,144 4.36 18.99 9.63% Magma Fincorp Ltd. (28Apr2017) ** 60 60,012 4.35 18.95 10.50% Hinduja Leyland Finance Ltd. (30May2017) ** 22 55,232 4.01 17.44 9.00% Edelweiss Commodities Services Ltd. (19Apr2017) ** 50 50,929 3.69 16.08 11.00% Aspire Home Finance Corp. Ltd. (06May2017) ** 20 20,031 1.45 6.32 Total 316,743 22.97 100.00 Money Market Instruments (a) Certificate of Deposits 2,300 227,957 16.54 100.00 ICICI Bank Ltd. (31May2017) 1,300 128,709 9.34 56.46 IDFC Bank Ltd. (15May2017) ** 1,000 99,248 7.20 43.54 Total 227,957 16.54 100.00 (b) Commercial Papers 1,420 703,958 51.06 100.00 Sun Pharmaceuticals Industries Ltd. (24May2017) ** 280 138,712 10.06 19.71 Small Industries Development Bank of India (16May2017) ** 260 128,995 9.36 18.32 NTPC Ltd. (18May2017) ** 260 128,952 9.35 18.32 Hindustan Petroleum Corp. Ltd. (22May2017) 260 128,857 9.35 18.30 Housing & Urban Development Corp. Ltd. (26May2017) ** 260 128,770 9.34 18.29 JM Financial Asset Reconstruction Co. Pvt. Ltd. (02May2017) ** 100 49,672 3.60 7.06 Total 703,958 51.06 100.00 OTHER CURRENT ASSETS 143,031 10.38 TOTAL ASSETS 1,391,689 100.95 LESS: CURRENT LIABILITIES 13,123 0.95 NET ASSETS 1,378,566 100.00 ** Non Traded / Thinly Traded Scrips

FRANKLIN INDIA CASH MANAGEMENT ACCOUNT March 31, 2017 March 31, 2016 Annexure 1 Dewan Housing Finance Corporation Ltd 70,395 LIC Housing Finance Limited 49,494 70,395 49,494 The aggregate purchases (other than those already disclosed earlier) made by the Scheme in these companies, during a period of one year before or after the date of the companies' investment are as follows: Dewan Housing Finance Corporation Ltd 219,015 Mahindra Rural Housing Finance Ltd 49,003 Reliance Jio Infocomm Limited 49,430 317,448 Note These investments have been made because of their value at these prices in case of equity shares and for high credit quality for comparable yield for the investment in fixed income instruments. The investments made are in accordance with the investment objectives of the scheme.

HISTORICAL PER UNIT STATISTICS FRANKLIN INDIA CASH MANAGEMENT ACCOUNT Year ended Year ended Year ended March 31,2017 March 31,2016 March 31,2015 (a) (b) (c) Net Asset value, per unit Growth Plan 24.5826 23.1666 21.8303 Dividend Plan 10.0127 10.0108 10.0085 Direct Growth Plan 25.4346 23.8126 22.2208 Direct Dividend Plan 10.0102 10.0095 10.0095 Gross Income: i) Income other than profit on sale of investment, per unit 0.91 2.77 1.11 ii) Profit / (Loss) on interscheme sale/transfer of investment, per unit iii) Profit / (Loss) on sale of investment to third party, per unit 0.01 iv) Transfer to Revenue Account from past year's reserve per unit Aggregate of expense, write offs, amortisation and charges, per unit (0.12) (0.44) (0.16) (d) Net Income, per unit 0.79 2.34 0.95 (e) Net unrealised appreciation/(depreciation) in value of investments, per unit (f) i) Highest traded price N.A. N.A. N.A. ii) Lowest traded price N.A. N.A. N.A. iii) P.E. Ratio N.A. N.A. N.A. (g) Ratio of Expenses to Average Net Assets Regular Plan 0.95 1.07 1.08 Direct Plan 0.33 0.16 0.06 (h) Ratio of Gross Income to Average Net Assets 6.82 6.77 7.57 (i) i) Highest repurchase price/nav ** Growth Plan 24.5826 23.1666 21.8303 Dividend Plan 10.0127 10.0108 10.0085 Direct Growth Plan 25.4346 23.8126 22.2208 Direct Dividend Plan 10.0102 10.0095 10.0095 ii) Highest resale price ** Growth Plan 24.5826 23.1666 21.8303 Dividend Plan 10.0127 10.0108 10.0085 Direct Growth Plan 25.4346 23.8126 22.2208 Direct Dividend Plan 10.0102 10.0095 10.0095 iii) Lowest repurchase price/nav ** Growth Plan 23.1792 21.8362 20.4575 Dividend Plan 10.0108 10.0085 10.0085 Direct Growth Plan 23.8268 22.2288 20.6040 Direct Dividend Plan 10.0095 10.0095 10.0095 iv) Lowest resale price ** Growth Plan 23.1792 21.8362 20.4575 Dividend Plan 10.0108 10.0085 10.0085 Direct Growth Plan 23.8268 22.2288 20.6040 Direct Dividend Plan 10.0095 10.0095 10.0095 0.00 less than 0.01 per unit Per unit calculation is based on number of units at the end of the year.per unit statistics are disclosed for schemes/plans in existence at the end of respective years. **The highest and lowest resale pricce has been determined, after adding to the NAV, the maximum entry load applicable.