  We present a detailed analysis of the Aharonov-Bohm interference oscillations
manifested through transmission of an electron in a mesoscopic ring with a
magnetic impurity atom inserted in one of its arms. The electron interacts with
the impurity through the exchange interaction leading to exchange spin-flip
scattering. Transmission in the spin-flipped and spin-unflipped channels are
explicitly calculated. We show that the spin-flipper acts as a dephasor in
spite of absence of any inelastic scattering. The spin-conductance (related to
spin-polarized transmission coefficient) is asymmetric in the flux reversal as
opposed to the two probe conductance which is symmetric under flux reversal.
