CORPORATE INFORMATION
Compucom Software Limited ('the Company') operates in areas like E-Governance Projects, ICT Education Projects,
Software Design & Development, Learning Solutions, IT Training, Skilling and Placement activities, Wind Power Generation
and Hospitality sector etc.
The Company is a public limited company incorporated and domiciled in India and has its registered office in Jaipur,
Rajasthan, India. The Company has its listings on the BSE Limited and National Stock Exchange of India Limited and
Calcutta stock exchange.
The financial statements are approved for issue by the Company's Board of Directors in its meeting held on May 27, 2025.
NOTE 2
BASIS OF PREPARATION OF FINANCIAL STATEMENTS
A. Basis of preparation
These financial statements are prepared on a going concern basis, in accordance with Indian Accounting Standards
(Ind AS) under the historical cost convention on the accrual basis except for financial instruments which are measured
at fair values and the provisions of the Companies Act, 2013 ('Act') (to the extent notified). The Ind AS is prescribed under
Section 133 of the Act, read with relevant rule of the Companies (Indian Accounting Standards) Rules, 2015, as amended
time to time. Accounting policies have been consistently applied except where a newly issued accounting standard is
initially adopted or a revision to an existing accounting standard requires a change in the accounting policy hitherto in
use.
B. Use of estimates, assumption and judgments
(a) Use of estimates:
The preparation of the standalone financial statements in conformity with Ind AS requires the management to make
estimates, judgments and assumptions that affect the reported amounts of assets and liabilities, the disclosure of
contingent assets and liabilities on the date of the standalone financial statements and the reported amounts of
revenues and expenses for the year reported. Actual results could differ from those estimates. Estimates and
underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognized in
the year in which the estimates are revised, and future periods are affected.
(b) Significant Judgment Contingencies:
In the normal course of business, contingent liabilities may arise from litigation, taxation and other claims against
the Company. Where it is management's assessment that the outcome cannot be reliably quantified or is uncertain,
the claims are disclosed as contingent liabilities. Such liabilities are disclosed in the notes but are not provided for
in the financial statements. While considering the possible, probable and remote analysis of taxation, legal and
other claims, there is always a certain degree of judgment involved pertaining to the application of the legislation
which in certain cases is supported by views of tax experts and/or earlier precedents in similar matters. Although
there can be no assurance regarding the final outcome of the legal proceedings, the Company does not expect
them to have a materially adverse impact on the Company's financial position or profitability.
NOTE 3
SIGNIFICANT ACCOUNTING POLICIES
A. Fair value measurement
The Company measures financial instruments, such as, investment in securities and other assets wherever necessary
at fair value at balance sheet date. Fair 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 market conditions and risks existing at each reporting period date. The methods used to determine fair
value include available quoted market process and dealer quotes. All methods of assessing fair value result in general
approximation of value, and such value may or may not be realized.
For financial assets and liabilities maturing within one year from balance sheet date which is not carried at fair value, the
carrying amount of such asset and liabilities were carried at amortized cost.
B. Current and non-current classification
The Company presents assets and liabilities in the balance sheet based on current/ non-current classification.
An asset is treated as current when it is:
Expected to be realized or intended to be sold or consumed in normal operating cycle,
• Held primarily for the purpose of trading,
• Expected to be realized within twelve months after the reporting period, or
• Cash or cash equivalent unless restricted from being exchanged or used to settle a liability for at least twelve
months after the reporting period,
All other assets are classified as non-current.
A liability is treated as current when it is:
• Expected to be settled in normal operating cycle
• Held primarily for the purpose of trading
• Due to be settled within twelve months after the reporting period, or
• There is no unconditional right to defer the settlement of the liability for at least twelve months after the reporting
period
All other liabilities are classified as non-current.
Deferred tax assets and liabilities are classified as non- current assets and liabilities.
The operating cycle is the time between the acquisition of assets for processing and their realization in cash and cash
equivalents. The Company has identified twelve months as its operating cycle.
Some line items presented in the financial statements have been reclassified under different heads and sub heads to
encourage appropriate disclosure of information contained, beginning from the earliest period presented in the financial
statements.
C. Functional and presentation currency
The financial statements are prepared in Indian Rupees (INR), which is the Company's functional currency. All financial
information presented in INR has been rounded to the nearest lacs.
D. Revenue recognition
1. Revenue from operations: -
• The Company earns revenue primarily from E-Governance Projects, ICT Education Projects, Software Design
& Development, Learning Solutions & IT Training including Skilling and Placement activities, Wind Power
Generation, Hospitality Sector etc.
• Revenue is recognized upon transfer of control of promised products or services to customers in an amount
that reflects the consideration which the Company expects to receive in exchange for those products or services.
• Revenue from contracts which are on time and material basis are recognized when services are rendered, and
related costs are incurred.
• Revenue related to fixed price maintenance and support services contracts where the Company is standing
ready to provide services is recognized based on time elapsed mode and revenue is straight lined over the
period of performance.
• Revenue from sale of power is recognized on the basis of actual units generated and transmitted to the
purchaser.
• Revenue from the sale of hardware and goods is recognized at the point in time when control is transferred to
the customer.
• In respect of other fixed-price contracts, revenue is recognized using percentage-of-completion method ('POC
method') of accounting with contract costs incurred determining the degree of completion of the performance
obligation. The contract costs used in computing the revenues include cost of fulfilling warranty obligations.
• Revenue from the sale of distinct internally developed software and manufactured systems and third party
software is recognized at the point in time when the system or software is delivered to the customer. In cases
where implementation or customization services rendered significantly modifies or customizes the software,
these services and software are accounted for as a single performance obligation and revenue is recognized
over time on a POC method.
• Revenue is measured based on the transaction price, which is the consideration, adjusted for volume discounts,
service level credits, performance bonuses, price concessions and incentives, if any, as specified in the
contract with the customer. Revenue also excludes taxes collected from customers.
2. Dividend: - (Ind AS 109 5.7.1A Additional lines not added)
Dividend income is recognized in the statement of profit and loss only when
• the entity's right to receive payment of the dividend is established;
• it is probable that the economic benefits associated with the dividend will flow to the entity; and
• the amount of the dividend can be measured reliably.
3. Interest income: -
Interest income from a financial asset is recognized when it is probable that the economic benefits will flow to the
Company and the amount of income can be measured reliably. Interest income is accrued on a time basis, with
reference to the principal outstanding and at the effective interest rate applicable.
E Property, plant and equipment
1. Property, plant and equipment at office and at site
An item of property, plant and equipment that qualifies as an asset is measured on initial recognition at cost.
Following initial recognition, items of property, plant and equipment are carried at its cost less accumulated
depreciation. The initial cost of property, plant and equipment comprises its purchase price, including import duties
and non-refundable purchase taxes, and any directly attributable costs of bringing an asset to working condition
and location for its intended use. It also includes the initial estimate of the costs of dismantling and removing the
item and restoring the site on which it is located. Expenditure incurred after the property, plant and equipment have
been put into operation, such as repairs and maintenance, are normally charged to the Statement of Profit and Loss
in the period in which the costs are incurred.
Major inspection and overhaul expenditure is capitalized.
Major machinery spares parts are capitalized when they meet the definition of Property, Plant and Equipment.
Gains and losses on disposal of an item of property, plant and equipment are determined by comparing the
proceeds from disposal with the carrying amount of property, plant and equipment, and are recognized net within
other income/other expenses in the Statement of Profit and Loss.
Assets held for sale are carried at lower of their carrying value or fair value less cost to sell.
2. Capital work in progress (CWIP)
Assets in the course of construction are capitalized in capital work in progress account. At the point when an asset
is capable of operating in the manner intended by the management, the cost of construction is transferred to the
appropriate category of property, plant and equipment. Costs associated with the commissioning of an asset are
capitalized in CWIP until the period of commissioning has been completed and the asset is ready for its intended
use to the extent commissioned. Advances given towards acquisition of fixed assets are not classified as Capital
work in progress but as non-current assets.
3. Depreciation
Depreciable amount for assets is the cost of an asset, or other amount substituted for cost, less its estimated
residual value. Depreciation on tangible property and other equipment has been provided on the straight-line
method.
The useful lives of the above assets are in line with the useful lives as prescribed under Part C of schedule II of the
Companies Act, 2013, The management believes that these estimated useful lives are realistic and reflect fair
apportionment of the period over which the assets are likely to be used.
The residual values, useful lives and methods of depreciation of property, plant and equipment are reviewed at each
financial year end and adjusted prospectively, if appropriate.
F. Intangible assets
Intangible assets acquired separately are measured on initial recognition at cost. Following initial recognition, intangible
assets are carried at cost less any accumulated amortization and accumulated impairment losses. Gains or losses
arising from derecognition of an intangible asset are measured as the difference between the net disposal proceeds
and the carrying amount of the asset and are recognized in the Statement of Profit and Loss when the asset is
derecognized.
Intangible assets are amortized over their estimated useful life. The estimated useful life of the intangible assets and
the amortization period are reviewed at the end of each financial year and the amortization period is revised to reflect the
changed pattern, if any.
G Borrowing Cost
Borrowing costs directly attributable to the acquisition, construction or production of an asset that necessarily takes a
substantial period of time to get ready for its intended use or sale are capitalized as part of the cost of the asset. All other
borrowing costs are expensed in the period in which they occur. Borrowing costs consists of interest and other costs
than an entity incurs in connection with the borrowings of the funds.
H. Impairment of non-financial assets
The Company assesses at each reporting date as to whether there is any indication that any Property, Plant and
Equipment and Intangible Assets or group of Assets, called Cash Generating Units (CGU) may be impaired. If any such
indication exists, the recoverable amount of an asset or CGU is estimated to determine the extent of impairment, if any.
When it is not possible to estimate the recoverable amount of an individual asset, the Company estimates the recoverable
amount of the CGU to which the asset belongs.
An impairment loss is recognized in the Statement of Profit and Loss to the extent, asset's carrying amount exceeds its
recoverable amount. The recoverable amount is higher of an asset's fair value less cost of disposal and value in use.
Value in use is based on the estimated future cash flows, discounted to their present value using pre-tax discount rate
that reflects current market assessments of the time value of money and risk specific to the assets.
The impairment loss recognized in prior accounting period is reversed if there has been a change in the estimate of
recoverable amount.
I. Financial instruments
Financial assets and financial liabilities are recognized when a Company becomes a party to the contractual provisions
of the instruments.
1. Initial Recognition and Measurement-Financial Assets and Financial Liabilities
Financial assets and financial liabilities are initially measured at fair value. Transaction costs that are directly
attributable to the acquisition or issue of financial assets and financial liabilities (other than financial assets and
financial liabilities at fair value through profit or loss and ancillary costs related to borrowings) are added to or
deducted from the fair value of the financial assets or financial liabilities, as appropriate, on initial recognition.
Transaction costs directly attributable to the acquisition of financial assets or financial liabilities at fair value through
profit or loss are recognized immediately in the Statement of Profit and Loss.
2. Classification and Subsequent Measurement: Financial Assets.
The Company classifies financial assets as subsequently measured at amortized cost, fair value through Other
Comprehensive Income (“FVTOCI”) or fair value through profit or loss (“FVTPL”) on the basis of following:
the entity's business model for managing the financial assets and
the contractual cash flow characteristics of the financial asset.
a) Financial assets carried at amortized cost
A financial asset is subsequently measured at amortized cost if following both of the conditions are met:
• It is held within a business model whose objective is to hold the asset in order to collect contractual cash
flows, and
• The contractual terms of the financial asset give rise on specified dates to cash flows that are solely
payments of principal and interest on the principal amount outstanding.
b) Financial assets at fair value through other comprehensive income
Financial assets are measured at fair value through other comprehensive income if both of the following
conditions are met:
• The financial assets are held within a business model whose objective is achieved both by collecting
contractual cash flows and selling of financial asset and
• The contractual terms of financial asset give rise on specified dates to cash flows that are solely payments
of principal and interest on the principal amount outstanding.
c) Financial assets at fair value through profit or loss
Financial assets are measured at fair value through profit or loss unless they are measured at amortized cost
or at fair value through other comprehensive income on initial recognition. The transaction costs directly
attributable to the acquisition of financial assets and liabilities at fair value through profit or loss are immediately
recognized in statement of profit and loss.
d) Impairment of Financial Assets:
The Company assesses on a forward-looking basis the expected credit loss associated with its assets carried
at amortized cost. The impairment methodology applied depends on whether there has been a significant
increase in credit risk.
The Company determines if there has been a significant increase in credit risk of the financial asset since
initial recognition, an amount of reasonable provision is measured and recognized as loss of allowance on the
basis of historical experience and internal technical analysis. The classification of trade receivables in terms of
expected realization has been done by the management based on the past experience of the management.
Classification and Subsequent measurement: Financial Liabilities
The Company's financial liabilities include trade and other payables, loans an borrowings including bank
overdrafts, financial guarantee contracts and derivative financial instruments.
e) Financial liabilities at fair value through profit or loss
Financial liabilities are classified as at FVTPL when the financial liability is held for trading or are designated
upon initial recognition as FVTPL.
Gains or losses on financial liabilities held for trading are recognized in the Statement of Profit and Loss.
f) Other Financial Liabilities:
Other financial liabilities (including borrowings and trade and other payables) are subsequently measured at
amortized cost using the effective interest method.
The effective interest method is a method of calculating the amortized cost of a financial liability and of allocating
interest expense over the relevant period. The effective interest rate is the rate that exactly discounts estimated
future cash payments (including all fees and points paid or received that form an integral part of the effective
interest rate, transaction costs and other premiums or discounts) through the expected life of the financial
liability, or (where appropriate) a shorter period, to the net carrying amount on initial recognition.
g) Derecognition of Financial Assets and Financial Liabilities:
The Company de-recognizes a financial asset when the contractual rights to the cash flows from the financial
asset expire, or it transfers the rights to receive the contractual cash flows in a transaction in which substantially
all of the risks and rewards of ownership of the financial asset are transferred or in which the Company neither
transfers nor retains substantially all of the risks and rewards of ownership and does not retain control of the
financial asset. If the Company enters into transactions whereby it transfers assets recognized on its balance
sheet but retains either all or substantially all of the risks and rewards of the transferred assets, the transferred
assets are not derecognized.
A financial liability is derecognized when the obligation under the liability is discharged or cancelled or expires.
h) Investment in Subsidiaries:
Investment in subsidiaries is carried at cost in the financial statements.
i) Offsetting of financial instruments
Financial assets and financial liabilities are offset and the net amount is reported in the balance sheet if there
is a currently enforceable legal right to offset the recognized amounts and there is an intention to settle on a net
basis, to realize the assets and settle the liabilities simultaneously.
j) Derivative financial instruments and hedge accounting
The company currently did not have any derivative financial instruments nor there any hedging contract
outstanding at the balance sheet date.
k) Cash and Cash Equivalents
The Company considers all highly liquid financial instruments, which are readily convertible into known amounts
of cash that are subject to an insignificant risk of change in value and short-term money market deposits having
original maturities of three months or less from the date of purchase, to be cash equivalents. Cash and cash
equivalents consist of balances with banks which are unrestricted for withdrawal and usage.
For the purpose of the statement of cash flows, cash and cash equivalents consist of cash and short-term
deposits, as defined above, are considered an integral part of the Company's cash management.
J. Inventories
Inventories are valued at the lower of cost and net realizable value.Net realizable value is determined based on estimated
selling price, less further costs expected to be incurred to completion and disposal.
K. Cost recognition
Costs and expenses are recognized when incurred and have been classified according to their nature. The costs of the
Company are broadly categorized into employee benefit expenses, Learning Solution Execution Expenses, Finance
Costs, depreciation and amortization and other expenses. Employee benefit expenses include salaries, incentives and
allowances, contributions to provident and other funds and staff welfare expenses. Other expenses mainly include fees
to external consultancy expenses, travel expenses, communication expenses, bad debts and advances written off, Rent
and Facility Support, Insurance expenses and other expenses. Other expenses is an aggregation of costs which are
individually not material such as News Paper & Magazines, Demat Expenses, Postage & Telegram, entertainment, etc.
L. Taxation
Tax expense is the aggregate amount included in the determination of profit or loss for the period in respect of current tax
and deferred tax.
1. Current tax
Current tax is the amount of income taxes payable in respect of taxable profit for a period. Taxable profit differs from
'profit before tax' as reported in the Statement of Profit and Loss because of items of income or expense that are
taxable or deductible in other years and items that are never taxable or deductible in accordance with applicable tax
laws.
Current tax is measured using tax rates that have been enacted by the end of reporting period for the amounts
expected to be recovered from or paid to the taxation authorities.
2. Deferred tax
Deferred tax is recognized on temporary differences between the carrying amounts of assets and liabilities in the
financial statements and the corresponding tax bases used in the computation of taxable profit under Income Tax
Act, 1961.
Deferred tax liabilities are generally recognized for all taxable temporary differences. However, in case of temporary
differences that arise from initial recognition of assets or liabilities in a transaction (other than business combination)
that affect neither the taxable profit nor the accounting profit, deferred tax liabilities are not recognized. Also, for
temporary differences if any that may arise from initial recognition of goodwill, deferred tax liabilities are not recognized.
Deferred tax assets are generally recognized for all deductible temporary differences to the extent it is probable that
taxable profits will be available against which those deductible temporary difference can be utilized. In case of
temporary differences that arise from initial recognition of assets or liabilities in a transaction (other than business
combination) that affect neither the taxable profit nor the accounting profit, deferred tax assets are not recognized.
The carrying amount of deferred tax assets is reviewed at the end of each reporting period and reduced to the extent
that it is no longer probable that sufficient taxable profits will be available to allow the benefits of part or all of such
deferred tax assets to be utilized.
Deferred tax assets and liabilities are measured at the tax rates that have been enacted or substantively enacted by
the Balance Sheet date and are expected to apply to taxable income in the years in which those temporary differences
are expected to be recovered or settled.
M. Retirement and other Employee benefit schemes
1. Short-term employee benefits
The undiscounted amount of short-term employee benefits expected to be paid in exchange for the services
rendered by employees are recognized as an expense during the period when the employees render the services.
2. Post-Employment Benefits
a) Defined Contribution Plan (Provident Fund & ESIC)
The Company recognizes contribution payable to the provident fund scheme as an expense, when an employee
renders the related service. If the contribution payable to the scheme for service received before the balance
sheet date exceeds the contribution already paid, the deficit payable to the scheme is recognized as a liability.
If the contribution already paid exceeds the contribution due for services received before the balance sheet
date, then excess is recognized as an asset to the extent that the pre-payment will lead to a reduction in future
payment or a cash refund.
b) Defined Benefit Plans (Gratuity)
The Company pays gratuity to the employees who have completed five years of service with the Company at the
time of resignation. The gratuity is paid @15 days basic salary for every completed year of service as per the
Payment of Gratuity Act, 1972. The gratuity liability amount is contributed to the approved gratuity fund formed
exclusively for gratuity payment to the employees. The gratuity fund has been approved by respective Income
Tax authorities. The liability in respect of gratuity and other post-employment benefits is calculated using the
Projected Unit Credit Method and spread over the period during which the benefit is expected to be derived from
employees' services.
Remeasurements gains and losses arising from adjustments and changes in actuarial assumptions are
recognized in the period in which they occur in Other Comprehensive Income.
3. The code on social security 2020
The Indian Parliament has approved the Code on Social Security, 2020 which would impact the contributions by the
company towards Provident Fund and Gratuity. The Ministry of Labor and Employment has released draft rules for
the Code on Social Security, 2020 on November 13, 2020, and has invited suggestions from stake holders which
are under active consideration by the Ministry. The Company and its Indian subsidiaries will assess the impact and
its evaluation once the subject rules are notified and will give appropriate impact in its financial statements in the
period in which, the Code becomes effective and the related rules to determine the financial impact are published.
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