Fintech Select Ltd. — Interim / Quarterly Report 2022

Nov 29, 2022

FINTECH SELECT LTD.

CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS Unaudited September 30, 2022

FINTECH SELECT LTD.

September 30, 2022 CONTENTS

	Page
NOTICE TO READER	1
CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS
Condensed Consolidated Interim Statements of Financial Position	2
Condensed Consolidated Interim Statements of Operations and
Comprehensive Income(Loss)	3
Condensed Consolidated Interim Statements of Cash Flows	4
Condensed Consolidated Interim Statements of Changes in Shareholders’
Deficit	5
Notes to Condensed Consolidated Interim Financial Statements	6 – 17

NOTICE OF NO AUDITOR REVIEW OF CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS

Under National Instrument 51-102, Part 4, subsection 4.3 (3) (a), if an auditor has not performed a review of the interim financial statements, they must be accompanied by a notice indicating that an auditor has not reviewed the financial statements.

The accompanying condensed unaudited interim financial statements of the Company have been prepared by and are the responsibility of the Company’s management.

The Company’s independent auditor has not performed a review of these condensed financial statements in accordance with standards established by the Canadian Institute of Chartered Accountants for a review of interim financial statements by an entity’s auditor.

Fintech Select Ltd.

Condensed Consolidated Interim Statements of Financial Position (Unaudited)

(Presented in Canadian Dollars) As at September 30, 2022

As at September 30, 2022
	Note		September 30	December 31
			2022		2021
ASSETS
CURRENT
Cash		$	6,370	$	71,646
Accounts receivable			136,826		154,562
Intangibles – short term	4		134,376		292,668
Inventory			17,727		16,989
Prepaid and otherassets			15,944		23,033
			311,243		558,898
LONG TERM
Property and equipment	3		94,570		106,673
Intangibles– long term	4		479,767		557,499
			574,337		664,172
		$	885,580	$	1,223,070
LIABILITIES & SHAREHOLDER’S EQUITY
CURRENT
Accounts payable and accrued liabilities	13		1,600,364		3,557,563
Deferred revenue			6,448		6,448
Demand loan	5		33,349		136,519
Customer deposits			34,700		34,700
Current portionof lease obligations	8		92,955		114,910
			1,767,816		3,850,140
NONCURRENT
Lease obligations	8		--		56,583
			1,767,816		3,906,723
SHAREHOLDERS’ EQUITY
Share capital	6		18,686,265		18,389,265
Contributed and other surplus			6,695,094		6,695,094
Warrant capital	7		109,076		109,076
Other comprehensive loss			(218,654)		(14,243)
Deficit			(26,154,017)		(27,862,845)
			(882,236)		(2,683,653)
		$	885,580	$	1,223,070

Nature of Operations and Going concern (Note 1) Provision (Note 15) Approved by the Board

Naveed UI-Hassan Mohammad Abuleil

Director (Signed) Director (Signed)

The accompanying notes form an integral part of these consolidated financial statements.

2

Fintech Select Ltd.

Condensed Consolidated Interim Statements of Operations and Comprehensive Income (Unaudited)

(Presented in Canadian Dollars) For 3 and 9 months ended September 30, 2022

REVENUE EXPENSES Goods and services purchased Salaries and benefits Other general and administrative Stock based compensation Foreign exchange loss (gain) Depreciation and amortization Interest expenses	3 months ended September 30 2022 2021	9 months ended September 30, 2022 2021
	$ 599,123 $ 746,488 43,732 61,262 675,530 639,476 33,184 46,798 -- -- (27,333) (21,096) 31,044 31,577 2,994 6,733	$ 1,971,608 $ 2,139,346 142,102 188,904 2,042,038 1,625,239 162,821 141,200 -- -- (34,029) 2,441 94,246 95,953 13,052 21,509
	759,152 764,750	2,420,230 2,075,246
Net income (loss) from operations Gain on settlement of accounts payable	(160,029) (18,262) -- --	(448,622) 64,100 2,157,450 --
Net income (loss)	(160,029) (18,262)	1,708,828 64,100
Exchange difference on translating foreign operation Gain/(loss) on revaluation of intangibles	(36,796) (7,752) 7,033 60,582	(46,119) 7,387 (158,292) 93,136
Comprehensive income(loss)	$(189,792) $34,568	$1,504,417 $164,623
Income(Loss) per share
Basic	$ (0.002) $ (0.0003)	$ 0.022 $ 0.0009
Diluted	$ (0.002) $ (0.0002)	$ 0.022 $ 0.0009
Weighted average number of shares outstanding
Basic 80,049,515 72,624,515		79,342,372 72,312,898
Diluted 80,049,515 73,412,015		79,342,372 73,100,398

The accompanying notes form an integral part of these consolidated financial statements

3

Fintech Select Ltd.

Condensed Consolidated Interim Statements of Cash Flow

(Presented in Canadian Dollars) For 3 and 9 months ended September 30, 2022

Cash provided by (used in) Operations Net income (loss) Items not affecting cash Amortization Interest expenses Gain on settlement of accounts payable Unrealized foreign exchange loss/(gain)	3 months ended September 30 9 months ended September 30, 2022 2021 2022 2021
	$ (160,029) $ (18,262) $ 1,708,827 $ 64,100 31,044 31,578 94,246 95,953 2,994 6,733 13,052 21,509 -- -- (2,157,450) -- (37,233) (8,610) (46,665) 7,365
Net change in non-cash working capital Accounts receivable Inventory Prepaid and other assets Accounts payable and accrued liabilities Deferred revenue	(163,224) 11,439 (387,990) 188,927 4,991 102,758 17,735 (47,470) (1,937) 1,694 (738) (3,004) 11,586 11,607 7,089 (14,952) 204,615 (51,716) 497,252 40,386 -- -- -- (11,667)
	56,031 75,782 133,348 71,448
Investing Disposal of intangible Additions of intangibles and equipment	-- -- -- -- (1,317) (535) (4,411) (1,186)
	(1,317) (535) (4,411) (1,186)
Financing Lease payment Repayment of demand loan Issuance of shares	(28,728) (28,730) (86,184) (86,185) (29,262) -- (108,577) (40,002) -- -- -- 67,857
	(57,990) (28,730) (194,761) (58,330)
Net change in cash Effect of exchange rate changes on cash	(3,276) 46,517 (65,824) 11,932 437 862 548 23
Cash, beginning of the period	9,209 1,581 71,646 37,005
Cash, end of the period	$ 6,370 $ 48,960 $ 6,370 $ 48,960

The accompanying notes form an integral part of these consolidated financial statements

4

Fintech Select Ltd.

Condensed Consolidated Interim Statement of Changes in Shareholders’ Deficit (Presented in Canadian Dollars) For the 9 months ended September 30, 2022

	Share Capital Shares Amount	Contributed Surplus Options and Warrant Capital Accumulated Other Comprehensive Income(Loss) Deficit	Total
Balance, December 31, 2022 Issuance of shares Other comprehensive income from translation of foreign entity Loss on revaluation of intangibles Net income	72,624,515 18,389,265 7,425,000 297,000 -- -- -- -- -- --	6,695,094 109,076 (14,243) (27,862,845) -- -- -- -- -- -- (46,119) -- -- -- (158,292) -- -- -- -- 1,708,828	(2,683,653) 297,000 (46,119) (158,292) 1,708,828
As at September 30,2022	80,049,515 18,686,265	6,695,094 109,076 (218,654) (26,154,017)	(882,236)
Balance, December 31, 2020 Options exercised Options expired Other comprehensive income from translation of foreign entity Gain on revaluation of intangibles Net income	71,267,372 18,296,876 1,357,143 92,389 -- -- -- -- -- -- -- --	6,694,857 62,717 (124,733) (27,750,048) -- (24,531) -- -- 237 (237) -- -- -- -- 7,387 -- -- -- 93,136 -- -- -- -- 64,100	(2,820,331) 67,858 -- 7,387 93,136 64,100
As at September 30,2021	72,624,515 18,389,265	6,695,094 37,949 (24,210) (27,685,948)	(2,587,850)

The accompanying notes form an integral part of these consolidated financial statements

5

FINTECH SELECT LTD. Notes to condensed consolidated interim financial statements (Unaudited) September 30, 2022 (Presented in Canadian Dollars)

1. NATURE OF OPERATIONS AND GOING CONCERN UNCERTAINTY

Fintech Select Ltd. (the "Company") is a leader in financial payment services and is a provider of robust and disruptive payment solutions, including prepaid card programs and Crypto-currency POS solutions, and it has been working on an acquired e-wallet and online payment solution. The address of the registered office of Company is 100 King St W, Unit T201a, Chatham, ON, N7M 6A9. The Company’s shares are listed on the TSX Venture Exchange under symbol FTEC.

These consolidated financial statements have been prepared on a going concern basis, which assumes the Company will continue its operations in the foreseeable future and that it will be able to realize its assets and discharge its liabilities in the normal course of operations. The facts and circumstances noted below cast significant doubt on the company’s ability to continue as going concern.

During the quarter, the company incurred a net loss from operations $160,029 (third quarter of 2021$ 18,262). The company had a net inflow of cash from operations of $56,031 (second quarter of 2021 - inflow $75,782). The Company has a working capital deficiency of $1,456,573 (December 31, 2021 deficit $3,291,242). The working capital deficiency limits the Company’s ability to fund capital expenditures and operations.

The continuation of the Company as a going concern is dependent on raising sufficient working capital to maintain operations, reducing operating expenses, and increasing revenues and profits. The Company is pursuing further financing alternatives to fund its operations and continue its activities as a going concern. There is no assurance that it will be able to do so in the near future, as without enough financing, the Company may be forced to cease operations.

These consolidated financial statements do not give effect to adjustments that would be necessary to the carrying values and classification of assets and liabilities should the going concern assumption not be appropriate. These adjustments could be material.

The consolidated financial statements were authorized for issuance by the Board of Directors on November 29, 2022.

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FINTECH SELECT LTD. Notes to condensed consolidated interim financial statements (Unaudited) September 30, 2022 (Presented in Canadian Dollars)

2. BASIS OF PRESENTATION

Statement of compliance

The condensed consolidated interim financial statements have been prepared in accordance with International Accounting Standards 34, Interim Financial Reporting (IAS 34”) using accounting policies consistent with International Financial Reporting Standards (“IFRS”) as issued by the International Accounting Standards Board (“IASB”) and interpretations of the International Financial Reporting Interpretations Committee (IFRIC”). The accounting policies and methods of computation applied by the Company in these condensed consolidated interim financial statements are the same as those applied in the Company’s annual financial statements as at and for the year ended December 31, 2021, excepted as outlined below. These condensed consolidated interim financial statements should be read in conjunction with the 2021 annual financial statements.

Basis of presentation

These consolidated financial statements are prepared on the historical cost basis except for intangibles - short term which are measured at the fair value, with changes being recognized in other comprehensive income and financial assets classified as “fair value through profit and loss”, if any, which are measured at fair value.

Principles of consolidation

The condensed consolidated interim financial statements include the accounts of the Company and its wholly owned subsidiaries, 1382285 Ontario Limited ("SelectComm"), 2143436 Ontario Limited ("SelectCore Comm"), Local Fone Service, Inc. ("LFS"), SelectCore USA, LLC ("SelectCore US") and 2314606 Ontario Limited (“SelectCore Financial Services”).

Subsidiaries are all entities over which the Company has the power, is exposed, or has rights, to variable returns from its involvement and has the ability to use its power to affect its returns. Subsidiaries are fully consolidated from the date on which control is transferred to the Company.

The company reassesses whether or not it controls an investee if facts and circumstances indicate that there are changes to one or more of the three elements of control listed above.

Inter-Company transactions, balances and unrealized gains or losses between subsidiaries are eliminated in preparing the consolidated financial statements. The financial statements of the subsidiaries are prepared for the same reporting period as the reporting company using consistent accounting policies.

Functional and presentational currency

Unless otherwise noted, all amounts in the accompanying consolidated financial statements and these notes are presented in Canadian funds, which is the functional currency of the Company.

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FINTECH SELECT LTD. Notes to condensed consolidated interim financial statements (Unaudited) September 30, 2022 (Presented in Canadian Dollars)

3. PROPERTY AND EQUIPMENT

Activity during the year ended September 30, 2022 is as follows:

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Electronic Office Furniture
Cost Terminals Equipment & Fixtures Totals
Balance January 1, 2022 954,633 680,694 183,960 1,819,287
Additions 367 4,044 - 4,411
Balance September 30, 2022 955,000 684,738 183,960 1,823,698
Accumulated Depreciation
Balance January 1, 2022 936,619 612,922 163,072 1,712,613
Depreciation 3,670 9,878 2,967 16,515
Balance September 30, 2022 940,289 622,800 166,039 1,729,128
Net Book Value 14,711 61,938 17,921 94,570
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Activity during the year ended September 30, 2021 is as follows:

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Electronic Office Furniture
Cost Terminals Equipment & Fixtures Totals
Balance January 1, 2021 954,632 678,332 183,960 1,816,924
Additions - 1,186 - 1,186
Balance September 30, 2021 954,632 679,518 183,960 1,818,110
Accumulated Depreciation
Balance January 1, 2021 930,223 598,123 158,406 1,686,752
Depreciation 4,976 11,312 3,587 19,875
Balance September 30, 2021 935,199 609,435 161,993 1,706,627
Net Book Value 19,433 70,083 21,967 111,483
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FINTECH SELECT LTD. Notes to condensed consolidated interim financial statements (Unaudited) September 30, 2022 (Presented in Canadian Dollars)

4. INTANGIBLES

Intangibles – short term represents bitcoins held for sale. As of September 30, 2022, the Company has 5 bitcoins (December 31, 2021: 5 bitcoins). Cryptocurrency was revalued quarterly based on open market quoted price.

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Cryptocurrency
30-Sep-22 31-Dec-21
Balance January 1, $ 292,668 $ 184,596
Additions
Disposal - -
Revaluation (158,292) 108,072
Balance period end $ 134,376 $ 292,668
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Intangibles – long term represents computer software, Right-of-Use assets and leasehold improvement.

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Computer Right-of-use Leasehold
Cost Software Assets Improvement Totals
Balance January 1, 2022 1,591,138 499,967 6,522 2,097,627
Additions - - - -
Balance September 30, 2022 1,591,138 499,967 6,522 2,097,627
Accumulated Depreciation
Balance January 1, 2022 1,189,428 346,407 4,297 1,540,132
Depreciation 3,991 72,736 1,001 77,728
Balance September 30, 2022 1,193,419 419,143 5,298 1,617,860
Net Book Value 397,719 80,824 1,224 479,767
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FINTECH SELECT LTD. Notes to condensed consolidated interim financial statements (Unaudited) September 30, 2022 (Presented in Canadian Dollars)

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Computer Right-of-use Leasehold
Cost Software Assets Improvement Totals
Balance January 1, 2021 1,591,137 499,966 6,522 2,097,625
Additions - - - -
Balance September 30, 2021 1,591,137 499,966 6,522 2,097,625
Accumulated Depreciation
Balance January 1, 2021 1,186,417 249,422 2,962 1,438,801
Depreciation 2,342 72,739 1,001 76,082
Balance September 30, 2021 1,188,759 322,161 3,963 1,514,883
Net Book Value 402,378 177,805 2,559 582,742
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5. Demand Loan

	September	30, 2022	December 31, 2021
Demand loan	$	33,349	$136,519

This loan bears an interest rate of 8% per annum. It was secured by a promissory note and a general security agreement, covering all of the assets of the Company.

6. SHARE CAPITAL

Authorized: Unlimited common shares

Issued and fully paid:

	September	30, 2022	December	31, 2021
	Number	Amount	Number	Amount
Common Shares	80,049,515	$ 18,686,265	72,624,515	$ 18,389,265

7. STOCK OPTIONS

The Board of Directors has adopted a stock option plan for the Company (the “Plan”). Pursuant to the Plan, the Board of Directors may, from time to time at its discretion, allocate non-transferable options to purchase shares to directors, officers and technical consultants of the Company.

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FINTECH SELECT LTD. Notes to condensed consolidated interim financial statements (Unaudited) September 30, 2022 (Presented in Canadian Dollars)

Under the Plan, the aggregate number of shares to be issued upon the exercise of options granted thereunder may not exceed 10% of outstanding shares. Furthermore, the aggregate number of shares to be issued upon exercise of the options granted there under to any one director or officer shall not exceed 5% of the issued and outstanding shares and the number of shares reserved for issuance to all technical consultants will not exceed 2% of the issued and outstanding shares. Options shall expire no later than five years after the date of grant. Options may be exercised no later than ninety (90) days following cessation of the optionee’s position with the Company, provided that if the cessation of office, directorship or technical consulting arrangement was by reason of death, the option may be exercised within a maximum period of one year after such death, subject to the expiry date of such option.

The exercise price of options granted pursuant to the Plan shall be set by the Board of Directors and shall not be less than the applicable discount permitted by the TSX-V or such other stock market on which the shares are then traded. The options issued under the plan vest according to the provisions determined by the Board at the time of grant.

On June 22, 2020, the Company granted 3,850,000 incentive stock options, each giving the holder the right to acquire one common share to certain of its directors and officers. The options are exercisable at $0.05 per option for a period of three years from the date of grant, vesting immediately. 392,857 of these options were exercised in December 2020 and 1,357,143 were exercised in the first quarter of 2021.

On December 28, 2021, the Company granted 2,160,000 incentive stock options, each giving the holder the right to acquire one common shares to certain of its directors and officers. 1,600,000 of these options are exercisable at $0.05 per option and 560,000 are exercisable at $0.075 per option. All these options are exercisable for a period of three year from the date of grant, vesting immediately. None of these options were exercised as at September 30, 2022.

The Company had following options outstanding and exercisable at September 30, 2022:

	Period ended September 30,	Period ended September 30,	Year ended December 31, 2021	Year ended December 31, 2021
		2022
In number of units, except for	Number of options	Weighted	Number of options	Weighted
exercise price		average		average
		exercise		exercise
		price		price
Outstanding, beginning of year	4,260,000	0.05	4,582,143	0.25
Granted	--	--	2,160,000	0.06
Expired	--	--	(1,125,000)	0.30
Exercised	--	--	(1,357,143)	0.05
Outstanding, end of year	4,260,000	0.05	4,260,000	0.05
Exercisable, end ofyear	4,260,000	0.05	4,260,000	0.05

Below is a summary of exercise prices, and weighted average remaining life as at September 30, 2022 for each grant of options.

11

FINTECH SELECT LTD. Notes to condensed consolidated interim financial statements (Unaudited) September 30, 2022 (Presented in Canadian Dollars)

Granted in June 2020 Granted in December 2021 Balance, September 30, 2022	Weighted average exercise price Number of options Remaining life (Years)
	2,100,000 0.05 0.8 2,160,000 0.06 2.3
	4,260,000 $0.05 1.6

The following are the valuations of each grant of options and the major assumptions used to value these options.

Date of Expiry	Number of Options	Exercise Price	Grant Date Fair Value of options
27-Dec-24	1,600,000	$0.05	$ 53,186

The options granted were valued using the Black-Scholes option pricing model with the following assumptions.

Expected dividend yield Expected volatility Risk free interest rate Expected life	2021 0.00% 167% 0.25% 3 Date of Expiry Number of Options Exercise Price Grant Date Fair Value of options 27-Dec-24 560,000 $0.075 $ 17,941	2021

The options granted were valued using the Black-Scholes option pricing model with the following assumptions.

Expected dividend yield Expected volatility Risk free interest rate Expected life	2021
	0.00% 167% 0.25% 3

12

FINTECH SELECT LTD. Notes to condensed consolidated interim financial statements (Unaudited) September 30, 2022 (Presented in Canadian Dollars)

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8. COMMITMENTS

a) The Company has no lease commitments as at September 30, 2022.

b) Right of use assets

The Company had the following future commitments associated with its lease obligations:

Balance at December 31, 2021 Interest expense Lease payments Balance at September 30, 2022 Current portion Long term portion	$ 171,493 7,646 (86,184)
	$ 92,955
	92,955 --

9. CAPITAL MANAGEMENT

The Company's objective when managing capital is to maintain its ability to continue as a going concern in order to provide returns for shareholders and benefits for other stakeholders.

The Company includes equity, comprised of issued common shares, warrant reserve, contributed surplus and accumulated other comprehensive income in the definition of capital.

The Company's primary objective with respect to its capital management is to ensure that it has sufficient cash resources to fund its growth activities, and to maintain its ongoing operations. To secure the additional capital necessary to pursue these plans, the Company may attempt to raise additional funds through the issuance of equity and or debt financing. See note 1.

The Company’s overall capital management strategy during the period ended September 30, 2022 and 2021 has been to raise share capital, reach settlement with creditors, shut down money-losing businesses, and expand profitable call center business.

13

FINTECH SELECT LTD. Notes to condensed consolidated interim financial statements (Unaudited) September 30, 2022 (Presented in Canadian Dollars)

10. FINANCIAL RISK MANAGEMENT

The Company is exposed to a variety of financial risks by virtue of its activities: market risk (including currency risk and interest rate risk), credit risk and liquidity risk. The overall risk management program focuses on the unpredictability of financial markets and seeks to minimize potential adverse effects on financial performance.

Risk management is carried out by the accounting and finance department under policies approved by the Board of Directors. This department identifies and evaluates financial risks in close cooperation with management. The finance department is charged with the responsibility of establishing controls and procedures to ensure that financial risks are mitigated in accordance with the approved policies.

(a) Market Risk

(i) Currency Risk

The Company operates primarily in Canada and has a subsidiary in USA that had ceased operation. The Company has exposure to foreign exchange risk. Foreign exchange risk arises from purchase and sales transactions, as well as recognized financial assets and liabilities denominated in foreign currencies.

The Company's main objective in managing its foreign exchange is to maintain Canadian cash on hand to support Canadian forecasted cash flows over a 12-month horizon. To achieve this objective, the Company monitors forecasted cash flows in foreign currencies and attempts to mitigate the risk by modifying the currency of cash held.

Balances denominated in USD at September 30, 2022 and 2021 are as follows:

2022	2021
Cash 362	15,141
Accounts receivable and other receivables117,881	185,548
Accounts payable and accrued liabilities(115,566)	(107,475)
Total net asset(liability) $ 2,677	$93,214

Fluctuations in the Canadian dollar exchange rate have an impact on the Company’s results from operations.

Fluctuation of the U.S. dollar relative to the Canadian dollar of 5% would impact net income by approximately $ 134 as of September 30, 2022 (2021 impact net income - $4,661).

(ii) Interest rate risk:

Interest rate risk is the risk that the future cash flows of a financial instrument will fluctuate because of changes in market interest rates.

Financial assets and financial liabilities with variable interest rates expose the Company to cash flow interest rate risk.

The Company's demand loan has fixed interest rates and is not exposed to interest rate risk.

14

FINTECH SELECT LTD. Notes to condensed consolidated interim financial statements (Unaudited) September 30, 2022 (Presented in Canadian Dollars)

FINANCIAL RISK MANAGEMENT (Cont’d)

(b) Credit Risk

Credit risk is the risk of a financial loss to the Company if a customer or counterparty to a financial instrument fails to meet its contractual obligation. The maximum exposure to credit risk of the Company at period-end is the carrying value of its cash and accounts receivables.

The Company manages credit risk by maintaining bank accounts with Schedule 1 banks in Canada 。

The Company does not require collateral or other security for accounts receivable or amounts due from related parties. The Company estimates its provision for uncollectable amounts based on analysis of the specific amount and debtor's payment history and prospects. Accounts receivable are stated net of an allowance for doubtful accounts of $20,744 (2021: $20,744).

Top three customers represent 78% of trade accounts receivable as of September 30, 2022 (December 31, 2021 - three customers represented 86%). As of November 25, 2022, 88% of the accounts receivable balance was collected. As of September 30, 2022, approximately $30,588 (December 31, 2021 – $23,024) of the Company’s receivable were 60 days past due of which approximately $20,744 (December 31, 2021 - $20,744) have been allowed for as doubtful debts.

(c) Liquidity Risk

Liquidity risk is the risk that the Company will not be able to meet its obligations as they fall due.

The Company manages its liquidity risk by forecasting cash flows from operations and anticipated investing and financing activities. Senior management is also actively involved in the review and approval of planned expenditures.

As at September 30, 2022, the Company has accounts payable and accrued liabilities, demand loan and current portion of lease obligations of $1,726,668 due within 12 months (December 31, 2021 - $3,808,992), cash of $6,370 (December 31, 2021 - $71,646), receivables of $136,826 (December 31, 2021 - $154,562) and intangibles-short term of $134,376 (December 31, 2021 - $292,668) to meet its current obligations. As a result, the Company has liquidity risk.

(d) Economic Dependence

One customer represents 86% of the Company's revenue in the current period (2021 - one customer, accounting for more than 88% of total revenues).

The Company depends on large telecommunications carriers to provide certain products and services. If these carriers were unwilling or unable to provide such products and services in the future, the Company's ability to provide products and services to its customers may be adversely affected and the Company may not be able to obtain similar services from alternative carriers on a timely basis or on terms favorable to the Company.

(e) Fair value

The estimated fair values of accounts receivable, accounts payable, accrued liabilities and demand loans debt approximates their carrying values due to the relatively short-term nature of the instruments. The fair value of intangible – short term is based on open market price.

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FINTECH SELECT LTD. Notes to condensed consolidated interim financial statements (Unaudited) September 30, 2022 (Presented in Canadian Dollars)

11. RELATED PARTY TRANSACTIONS AND BALANCES

The following summarizes the Company’s outstanding balances with related parties:

	September 30, 2022September 30, 2021
	Accounts payable $ 520,048 328,548

The balances are non-secured and without interest or payment terms. They mainly represent funds provided by the Company’s Chief Executive Officer (CEO) and compensations due to directors for services provided.

From time to time throughout calendar year 2022, the Company’s CEO Mohammad Abuleil has either directly or indirectly (through a related or affiliated person or entity) advanced funds at zero interest to retire interestbearing liabilities of the Corporation, pay down long-term corporate debt, cover corporate expenses and to provide some general working capital. At September 30, 2022, these advances, net of partial repayments, have amounted to approximately $316,562.00 (the "Abuleil Advances”). The initial intention of the Corporation was to retire the Abuleil Advances through a formal equity or debt financing procured on the market. However, given the current trend of economic stagnation coupled with inflation and the prevailing interest-rate environment, the parties are working towards negotiating a formal loan arrangement (“Loan Arrangement”) with Mr. Abuleil on terms that are favourable to the Company, subject to applicable securities laws and the rules of the TSXV. In addition to the Abuleil Advances, depending on the economic conditions and outlook for 2023, the Company anticipates that it may require another $50,000 to $100,000 to be advanced (“Additional Advances”) by Mr. Abuleil within 2023. In such case, part of the intention with the potential Loan Arrangement would be for said Additional Advances to be rolled into the Loan Arrangement.

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FINTECH SELECT LTD. Notes to condensed consolidated interim financial statements (Unaudited) September 30, 2022 (Presented in Canadian Dollars)

12. KEY MANAGEMENT COMPENSATION

Key management personnel are defined as those persons having authority and responsibility for planning, directing and controlling the activities of the Company, directly or indirectly. Company’s key management personnel include the board of directors, Chief Executive Officer & President, Chief Financial Officer and Director of Business Operations.

Remuneration of Directors and key management of Company was as follows:

Three months ended September 30 2022 2021 Salaries and Benefits $ 107,385 $ 121,346 Total $ 107,385 $ 121,346

13. PROVISION

In July 2019, one of the Company’s subsidiaries (“subsidiary”) has been served with a Statement of Claim by Her Majesty the Queen in Right of Alberta (“Alberta”) in the amount of $633,284 (the “Alberta Claim”). The Alberta Claim relates to the balance of funds on expired cards pursuant to a Card Management Agreement between the subsidiary and Alberta. The claimed amount was included in the Claim served on the Company by its service provider. The Company has recorded such payables in its financial statements. The Company intends to vigorously defend the Claim, as all the funds claimed by Alberta were deposited in the Company’s service provider’s bank account and not that of the subsidiary.

14. COVID 19

During the period, the outbreak of the novel strain of coronavirus, specifically identified as “COVID 19”, has resulted in governments worldwide enacting emergency measures to combat the spread of the virus. These measures, which include the implementation of travel bans, self-imposed quarantine periods and social distancing, have caused material disruption to businesses globally resulting in an economic slowdown. Global equity markets have experienced significant volatility and weakness. Governments and central banks have reacted with significant monetary and fiscal interventions designed to stabilize economic conditions. The duration and impact of the COVID 19 outbreak is unknown at this time, as is the efficacy of the government and central bank interventions. It is not possible to reliably estimate the length and severity of these developments and the impact on the financial results and condition of the Company and its operating subsidiaries in future periods.

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