1. Background

"Go Digit General Insurance Limited ("the Company”) was incorporated on December 07, 2016, under the Companies Act, 2013 and is a subsidiary of Go Digit Infoworks Services Private Limited. The Company received a certificate of registration from the Insurance Regulatory and Development Authority of India (IRDAI) on September 20, 2017 to undertake General Insurance business with registration number 158 and subsequently commenced operations in October 2017. The Company has completed its Initial Public Offer (IPO) and accordingly the Company’s equity shares are listed on National Stock Exchange (NSE) and Bombay Stock Exchange (BSE) since May 23, 2024.”

2. Significant accounting policiesA. Basis of preparation

These financial statements have been prepared and presented on a going concern basis in accordance with Generally Accepted Accounting Principles followed in India under the historical cost convention, unless otherwise specifically stated, on an accrual basis and in accordance with the applicable provisions of the Insurance Regulatory and Development Authority Of India (Actuarial, Finance and Investment Functions of Insurers) Regulations, 2024 (the "IRDAI Actuarial & Allied Functions Regulations 2024”) read with Master Circular issued their under (Actuarial & Allied Functions, 2024)’, the Insurance Act, 1938 (the "Insurance Act”), the Insurance Regulatory and Development Authority Act, 1999 (the "IRDAI Act”), circulars / notifications issued by IRDAI from time to time, the Accounting Standards (AS) specified under Section 133 of the Companies Act, 2013 (the "Companies Act”), to the extent applicable and the relevant provisions of the Companies Act and orders / directions prescribed by the IRDAI in this behalf and current practices prevailing within the insurance industry in India, to the extent applicable to the financial statements.

B. Use of Estimates

The preparation of the financial statements in conformity with the Generally Accepted Accounting Principles in India ("Indian GAAP”) requires management to make judgments, estimates, and assumptions that affect the

reported amounts of assets and liabilities (including contingent liabilities) as at the date of the financial statements, and the reported amounts of income and expenses for the reporting period. The estimates and assumptions used in the preparation of the financial statements are based on management’s evaluation of the relevant facts and circumstances up to, and as of, the date of the financial statements. Actual results may differ from those estimates. Any revision to accounting estimates is recognized prospectively.

C. Revenue recognition

Premium Income

Premium including reinsurance accepted (net of Goods and Services Tax), other than for Longterm (with a policy term of more than one year) motor insurance policies for new cars and new two-wheelers sold on or after September 01, 2018 and Long-term non-motor insurance policies issued on or after October 01, 2024, is recognised as income on receipt of complete information at the commencement of risk and for instalment policies it is recognised on instalment receipt. Any revisions in premium amount are recognised in the period in which it occurs and over the remaining period of the policy or period of risk, as appropriate.

In accordance with

(a) IRDAI notification no. IRDAI/NL/ClR/ MOT/08/2018 dated August 28, 2018, multiyear premium received (net of Goods & Services Tax) for third party liability coverage under long-term motor insurance policies for new cars and new two wheelers sold on or after September 01, 2018, is recognized as income on a year-to-year basis over the policy period on 1/n basis where ‘n’ denotes the term of the policy in years;

(b) IRDAI notification no. IRDAI/ACTL/CIR/ MISC/80/05/2024 dated May 17, 2024, multi-year premium received (net of Goods & Services Tax) for certain applicable long-term non-motor insurance policies sold on or after October 01, 2024, is recognized as income on a year-to-year basis over the policy period on

1/n basis where ‘n’ denotes the term of the policy in years.

At the period’s end, estimates are made for reinsurance statements of accounts not yet received, based on available information and current trends. Any revisions in premium amount are recognised in the period in which it occurs and over the remaining period of the policy or period of risk, as appropriate.

Reinstatement premium is recorded as and when such premiums are recovered.

Premium earnings including for reinsurance accepted business (net of Goods and Service Tax) are recognised over the period of policy or period of risk, as appropriate. The Reinstatement premium is allocated on the same basis as the original premium over the balance term of the policy or period of risk, as appropriate. Any subsequent revision to the premium is recognised in the period in which it occurs and over the remaining period of the policy or period of risk, as appropriate.

Subsequent adjustments arising on cancellations of policies are recognised in the period in which they are cancelled.

Premium received in advance Premium on policies booked during the current period which have risk inception date subsequent to balance sheet date represents premium received in advance

Income earned on investments I nterest income is recognised on accrual basis. Accretion of discount and amortisation of premium relating to debt securities is recognised over the holding / maturity period on constant yield-to-maturity basis.

Dividend income is recognised when the right to receive the dividend is established.

The realised gain / loss on the transfer / sale of debentures and bonds is the difference between the transfer / sale price and the net amortised cost / carrying book value, which is computed on weighted average basis as on the date of transfer/sale. Sale consideration for realised gain / loss is net of brokerage and taxes, if any.

The realised gain / loss on mutual funds, additional tier 1 (Basel III compliant) bonds, Real estate investment funds, Exchange traded

funds, Alternative Investment Funds and listed equity shares is the difference between sale consideration and carrying cost as on the date of sale, determined on a weighted average cost basis and includes accumulated changes previously recognised under "Fair Value Change Account”.

Commission on reinsurance ceded

Commission on reinsurance ceded is recognised in the period in which reinsurance premium is ceded.

Profit commission under Re-Insurance Treaties wherever applicable is estimated and recognised as income on earned premium, as per calculation methodology and terms mentioned in the Treaty. These estimates are reviewed at each reporting date.

Adjustment to the scaled commission under reinsurance treaties, wherever applicable, is first assessed once all risks under the contracts are ceded and thereafter reviewed at the end of each reporting period and is recognised as income / expenditure and included under commission on reinsurance ceded.

D. Reinsurance premium ceded

Reinsurance premium ceded, other than for long-term motor insurance policies for new cars and new two wheelers sold on or after September 01, 2018 and long-term non-motor insurance policies sold on or after October 01, 2024, is accounted for in the period in which the risk commences and over the period of risk.

In the case of long-term motor insurance policies for new cars and new two-wheelers sold on or after September 01, 2018 and long-term nonmotor insurance policies sold on or after October 01, 2024, the reinsurance premium ceded is recognised on the insurance premium income allocated for the year simultaneously along with the recognition of the insurance premium income.

Unearned premium on reinsurance ceded is carried forward to the subsequent accounting period and is set off against related unearned premium income.

Any subsequent revisions to or cancellations of premiums are accounted for in the period in which they occur.

Premium paid/payable for excess of loss reinsurance cover (including catastrophic cover) is accounted as per the terms of the reinsurance arrangements.

E. Reserve for unexpired risk

Reserve for unexpired risk represents that part of the net premium written which is attributable to and allocated to the succeeding accounting periods. In accordance with Circular No. IRDAI/ Reg/10/204/2024 dated March 22, 2024 and Master Circular on IRDAI Actuarial and Allied Functions Regulations, 2024, reserve for unexpired risk is calculated based on 1/365 method in all segments subject to minimum of 100% of net premium written with respect of Marine Hull policies written during the period and are unexpired as on Balance Sheet date.

Reserve for unexpired risk on reinsurance accepted on account of terrorism pool is calculated as provided in Note 2. Q below.

F. Premium deficiency

Premium deficiency is recognised if the sum of expected claim costs, related expenses and maintenance costs (related to claims handling) exceeds the related reserve for unexpired risk.

Premium deficiency is assessed at each balance sheet date and is recognised at the segmental revenue account(s) level. The expected claims including related expenses and maintenance costs (related to claims handling) for premium deficiency reserve computation are estimated and duly certified by the Appointed Actuary.

G. Claims incurred

Claims incurred comprises of claims paid (net of reinsurance, salvage, co-insurance and other recoveries), change in estimated liability for outstanding claims made following a loss occurrence reported, change in estimated liability for claims incurred but not reported (IBNR) and claims incurred but not enough reported (IBNER) and specific settlement costs comprising survey, legal, investigation, other directly attributable and allocated expenses.

Provision is made for the estimated value of outstanding claims at the Balance Sheet date net of reinsurance, salvage, co-insurance and other recoveries. Such provision is made on the basis of the ultimate amounts that are likely to be paid on each claim,as initially estimated by the management in light of past experience and progressively modified for changes as appropriate, on availability of further information

and include claim settlement costs likely to be incurred to settle outstanding claims.

Claims (net of amounts receivable from reinsurers / co-insurers) are recognised on the date of intimation based on estimates from surveyors / insured in the respective revenue accounts.

Adjustments required on account of negotiated settlements of outward re-insurance contracts are recognized in the period in which settlements are finalized and added to ‘claims paid - reinsurance ceded’.

Adjustments required on account of negotiated settlements of co-insurance/inward re-insurance contracts are recognized in the period in which the settlements are finalized and added to/ reduced from ‘claims paid- Direct’/ ‘claims paid -re-insurance accepted”, as the case may be.

The Estimated liability for outstanding claims at balance sheet date is recorded net of claims recoverable from/payable to co-insurers/ reinsurers and salvage to the extent there is certainty of realisation.

At each balance sheet date,the estimated liability for claims incurred but not reported (IBNR) and claims incurred but not enough reported (IBNER) at Gross and Net level is estimated by the Appointed Actuary in compliance with guidelines issued by Master Circular on Actuarial, Finance, and Investment Functions of Insurers and applicable provisions of Actuarial Practice Standard 21 issued by the Institute of Actuaries of India. The Appointed Actuary uses generally accepted actuarial methods for each product category as considered appropriate depending upon the availability of past data as well as appropriateness of the different methods to the different lines of businesses.

H. Acquisition costs

Acquisition costs are defined as costs that vary with and are primarily related to the acquisition of new and renewal insurance contracts viz. commission. These costs are expensed in the period in which they are incurred.

I. Borrowings

Borrowing costs are charged to the Profit and Loss account in the period in which they are incurred.

J. Property, Plant and Equipment and Intangibles

Property, Plant and Equipment are stated at the cost of acquisition (including incidental

expenses relating to acquisition and installation of assets) and expenses directly attributable to bringing the asset to its working condition for its intended use, less accumulated depreciation and impairment of assets, if any.

Intangible assets are stated at the cost of acquisition/development/improvement less accumulated amortisation and impairment, if any.

Significant direct expenditure on improvement to software is capitalised when it is probable that such expenditure will enable the software to generate future economic benefits in excess of its originally assessed standard of performance and such expenditure can be measured and attributed to the software reliably. Indirect expenditure and overheads are not capitalized.

Capital work in progress includes Property, Plant and Equipment and Intangibles not ready for the intended use and are carried at cost, comprising direct cost and related incidental expenses.

The depreciable amount for assets is the cost of an asset or other amount substituted for cost, less its estimated residual value, if any. The Company has, considering expected economic values post-retirement and other technical factors, estimated that the residual value of Property, Plant and Equipment and Intangibles to be Nil.

Depreciation / amortisation on assets is provided on the straight-line method over the estimated useful life

Depreciation / amortisation on assets purchased / disposed-off during the period, has been provided on pro-rate basis.

The estimated useful life used for the calculation of depreciation or amortisation is as follows for various classes of assets -

Intangible assets comprising computer software & improvements are amortised over a period of 3 years, being the management’s estimate of the useful life of such intangibles

Assets costing less than ^5,000 are fully expensed off during the year of purchase.

The estimated useful life of Property, Plant and Equipment and Intangibles & residual value are reviewed at the end of each financial year and the depreciation and amortisation period is revised to reflect the changed pattern, if any.

I mpairment of Property, Plant and Equipments and Intangibles

The carrying values of Property, Plant and Equipments and Intangible are reviewed at each balance sheet date for impairment, if and when there are indications thereof. Impairment occurs when the carrying value of property, plant and equipment/intangible exceeds its value-in-use calculated as the present value of future cash flows expected to arise from its continuing use and its eventual disposal. The impairment loss to be expensed is determined as the excess of the carrying amount over the higher of the it’s net sales price or value-in-use, as determined above. After impairment, depreciation/amortisation is provided on the revised carrying value of the property, plant and equipment/intangible over it remaining useful life. Impairment loss previously

expensed is reversed in the subsequent period to the extent, the amount that is higher of its net sales price or value-in-use from it’s carrying amount.

K. Operating leases

Leases where the lessor effectively retains substantially all the risks and benefits of ownership of the leased assets are classified as operating leases. Operating lease payments made towards assets/premises are recognised as an expense in the revenue account(s) and adjustment for lease equalisation reserve in accordance with generally accepted accounting principle is charged to profit and loss account, as per lease terms. These expenses are recorded net of rental income recovered through subleasing.

Initial direct costs incurred specifically for an operating lease are charged to the revenue account(s) and profit and loss account as and when those are incurred.

L. Foreign currency transactions

Transactions denominated in foreign currencies are recorded in Indian Rupees at the exchange rate prevailing on the date of the transaction.

At each balance sheet date, monetary items denominated in foreign currencies are converted into rupees equivalents at the exchange rate prevailing as of that date.

All exchange differences arising on settlement/ conversion of foreign currency transactions are included in the revenue account(s) or profit and loss account, as the case may be in the period in which they arise.

M. Investments

Initial Recognition

Investments are made and accounted for in accordance with the Insurance Act, 1938, IRDAI Actuarial and Allied Functions Regulations, 2024, as amended, the IRDAI Financial Statements Regulations and various other circulars / notifications issued by the IRDAI in this context from time to time.

Investments are recorded at cost on trade / acquisition date, which includes brokerage, taxes and stamp duty and exclude broken period interest.

Classification

Investments maturing (including call option date) within twelve months from the balance

sheet date and investments made with specific intention to be disposed off within twelve months from the balance sheet date are classified as short-term investments.

Investments other than short-term investments are classified as long-term investments.

Investment funds are segregated into policyholders’ funds and shareholders’ funds at the security level in compliance with Circular No. IRDA/F&A/CIR/CPM/056/03/2016 dated April 04, 2016.

Any deficit / shortfall in Policyholders’ Investments arising out of the loss in the Revenue Account(s) or otherwise is recouped by the transfer of securities from the Shareholders’ Investments to the Policyholders’ Investments on a half-yearly basis.

Policyholders’ fund is the sum total of a) outstanding claims including IBNR (incurred but not reported) & IBNER (incurred but not enough reported), b) unexpired premium reserve, c) premium deficiency, if any, d) catastrophe reserve, if any, and e) other liabilities net off other assets. Other liabilities comprise of premium received in advance, unallocated premium, balance due to other insurance companies, and due to policyholders. Other assets comprise of outstanding premium, dues from other entities carrying on insurance business (including reinsurers), balance with Terrorism Pool.

Shareholders’ funds comprise of share capital, including reserves and surplus, less accumulated losses, if any, preliminary expenses and miscellaneous expenditure to the extent not written off or adjusted.

Valuation

All debt securities excluding for additional tier 1 (Basel III compliant) perpetual bonds and nonconvertible preference shares are considered as ‘held to maturity’ and accordingly stated at historical cost subject to amortisation of premium or accretion of discount on constant yield to maturity basis in the Revenue Account(s) and in the Profit and Loss Account over the period of maturity / holding.

I nvestments in mutual funds, additional tier 1 (Basel III compliant) bonds, listed equity shares, Real estate investment funds, Exchange traded funds and Alternative Investment Funds are valued at fair value through Fair Value Change Account as at balance sheet date.

Fair value for listed equity investments, Real estate investment funds & Exchange traded funds is derived basis last quoted closing price on the National Stock Exchange (NSE) being selected as primary exchange as required by IRDAI Actuarial and Allied Functions Regulation 2024, as amended. In case if stock is not listed on NSE, the last quoted closing price from BSE Limited is taken for fair valuation.

The fair value of mutual funds is derived basis of NAV published by the Association of Mutual Funds of India (AMFI).

The fair value of Alternate Investment fund is derived basis of NAV published by the fund house.

Valuation of additional tier 1 (Basel III compliant) bonds is done as published by CRISIL which in turn are based on market yield rates published by rating agency registered with the Securities and Exchange Board of India (SEBI) in compliance with circular no: SEBI/HO/IMD/DF4/ CIR/P/2021/034

Fair value change account

In accordance with the IRDAI Actuarial and Allied Functions Regulations 2024, any unrealised gain/loss arising due to change in fair value of mutual fund investments, additional tier 1 (Basel III compliant) bonds, listed equity shares, Real estate investment funds, Exchange traded funds and alternative investment funds are accounted in ‘Fair value change account’ and carried forward in the balance sheet and is not available for distribution as dividend.

Impairment of investments

The Company assesses whether any other than temporary impairment has occurred on its investments at each balance sheet date. If any such indication exists, then the carrying value of such investment is reduced to its recoverable amount/market value on the balance sheet date and impairment loss is recognised in the Profit and Loss Account. If, at a balance sheet date, there is any indication that a previously assessed impairment loss no longer exists then the impairment loss, earlier recognised in the Profit and Loss Account, is reversed and the investment is restated to that extent.

N. Employee benefits

Short-term employee benefits

All employee benefits payable within twelve

months of rendering of service are classified

as short-term employee benefits. Benefits such as salaries, bonuses, short-term compensated absences and other non-monetary benefits are recognised in the period in which the employee renders the related service. All shortterm employee benefits are accounted on an undiscounted basis.

Long-term employee benefits The Company has both, defined contribution and defined benefit plans. The plans are financed by the Company and in case of some defined contribution plans, by the Company along with its employees.

• Defined contribution plans

These are plans in which the Company contributes prescribed percentages of the qualifying salary of eligible employees, on a monthly basis to funds managed by Employee Provident Fund Organisation in accordance with the relevant regulations and does not have any legal or informal obligation to pay additional sums. These comprise of contributions to the employees’ provident fund and family pension fund. The Company’s payments to defined contribution plans are expensed off during the period in which employees perform the services.

• Defined benefit plans

The company is required to pay prescribed percentage of qualifying salary for every completed year of service as Gratuity to employees on their separation/retirement after continuous service of five years subject to a maximum of ^ 20 Lakhs, in accordance with the relevant regulations.

Expenses for this defined benefit statutory gratuity are calculated as at each Balance Sheet date based on actuarial valuation carried out using the Projected unit credit method by an independent external actuary. Actuarial losses and gains are charged off to Revenue account(s)/Profit and loss account.

• Other long-term employee benefits Provision for other long-term benefits includes accumulated compensated absences that are entitled to be carried forward for availment in service or encashment at the time of separation. The Company’s liability towards these other

long-term benefits are accrued based on actuarial valuation carried out using the Projected unit credit method by an independent external actuary. Actuarial losses and gains are charged off to Revenue account(s)/Profit and loss account.

• Long term Incentive Plan

The Company has a Long Term Incentive Plan (‘LTIP’) for selected employees. The plan is a discretionary deferred compensation plan. It is a plan with annual accruals and a defined payment schedule. Provision for LTIP liability is accrued based on actuarial valuation carried out using Projected unit credit method (PUCM) by an independent external actuary.

O. Employee Stock Option Plan (“ESOP”)

The Company has an equity settled ESOP with a quantified benefit. Options granted under the ESOP are measured at fair value of the option on the grant date using the Black Scholes method. Grant-date fair value is recognized as an employee compensation expense in profit and loss account over the vesting period or debited to holding company as applicable with a corresponding liability recorded under ESOP Outstanding Reserve Account which is grouped under Reserves & Surplus. When the option is settled, the related liability in the ESOP Outstanding Reserve Account is transferred to share premium account along with excess of Grant Price over the face value.

P. Taxation

Income tax expenses comprise current tax (i.e. the amount of tax payable on the taxable income for the period determined in accordance with the Income-tax Act, 1961), and deferred tax charge or credit (reflecting the tax effects of timing differences between the accounting income and taxable income for the period).

Current tax

Current tax is the amount expected to be paid to the tax authorities after taking credit for allowances and exemptions in accordance with the Income-tax Act, 1961.

Deferred tax

Deferred tax charge or credit and the corresponding deferred tax liabilities or assets are recognised using the tax rates that have been enacted or substantively enacted by the balance sheet date.

Deferred tax assets are recognised only to the extent there is reasonable certainty that the assets can be realised in future. However, where there is unabsorbed depreciation or carried forward loss under taxation laws, deferred tax assets are recognised only to the extent there is virtual certainty backed by convincing evidence that sufficient future taxable income will be available against which the deferred tax assets can be realised.

Deferred tax assets are reviewed as at balance sheet date and written down or written up to reflect the amount that is reasonably certain to be realised.

Goods and Services tax

Goods and Services tax (“GST”) collected (net of refunds) is considered as a liability against which GST paid for eligible input services, to the extent claimable, is adjusted and the net liability is remitted to the appropriate authority. Unutilised GST credits, if any, are carried forward under "Other Assets” and disclosed in Schedule 12 for adjustment in subsequent periods. At the end of every reporting periods, the Company assesses whether the unutilised GST credits are eligible for carrying forward to subsequent period as per the relevant legal provisions. Any ineligible GST credit is expensed off in Revenue account on such determination. GST liability to be remitted to the appropriate authority is disclosed under “Other - Statutory dues payable” in Schedule 13.

Q. Terrorism Pool

I n accordance with the requirements of IRDAI, the Company, together with other insurance companies, participates in the Terrorism Pool. This pool is managed by General Insurance Corporation of India (“GIC Re”). Amounts collected as terrorism premium, as decided by the Terrorism Pool Underwriting committee, are ceded at 100% of the terrorism premium collected to the Terrorism Pool, subject to conditions and overall limit of 2,000 crore.

In accordance with the terms of the agreement, GIC Re retrocedes to the Company terrorism premium to the extent of the Company’s agreed share (i.e. 0.50%) in the pool, which is recorded as reinsurance accepted. Such reinsurance accepted is recorded on the basis of quarterly statements received from GIC Re. Reinsurance accepted on account of terrorism pool is recorded with the latest statement received from GIC Re, which is generally one quarter in lag.

The company’s participates in "Terrorism pool excess of loss Reinsurance Protection” program.

The entire amount of reinsurance accepted for the current period on this account, up to the above date, has been carried forward to the subsequent accounting period as unexpired risk reserve for subsequent risks, if any, to be borne by the Company.

R. Contribution to solatium fund

I n accordance with the requirements of IRDAI circular dated March 18, 2003 and based on the decision made by the General Insurance Council in its meeting held on May 06, 2005 and further on April 01, 2010, the Company provides for contributions to solatium fund, established by the Central Government, at 0.1% of the total third-party premium of motor policies during the period. The outstanding amount payable to the fund manager as of the balance sheet date is included in Claims Outstanding.

S. Segment reporting

The Company has classified and disclosed segmental information for Fire, Marine and Miscellaneous classes of business based on the primary segments identified under IRDAI Actuarial and Allied Functions Regulations, 2024 read with AS 17 - Segment Reporting specified under section 133 of Companies Act, 2013.

There are no reportable geographical segments, as all business is written in India.

Allocation of income and expenses to specific segments (including sub-segment) is done in the following manner, which is applied on a consistent basis.

Allocation of investment income Investment income earned on the investment identified out of shareholders fund is credited to profit and loss account.

I nvestment income earned on the investments identified out of policyholders’ funds is allocated to the various segments on the basis of average of unallocated premium, premium received in advance, reserves for unexpired risks and outstanding claims of the respective segments.

Allocation of other income

Other income which are directly attributable and identifiable to business segments are allocated to the respective business segments.

As required under (Actuarial, Finance and Investment Functions of Insurers) Regulations, 2024, excess of ‘Operating Expenses related to Insurance Business’ over the allowable limits at the Company level is accounted as ‘Contribution from Shareholders Funds towards excess EOM’ in Revenue Account and as ‘Contribution to Policyholders Funds towards Excess EOM’ in Profit and loss account.

Such Contribution from Shareholders Funds towards excess EOM is further allocated to various business segments in proportion to their excess as if allowable limits are applied individually at the segment level.

Other income, other than above, which are not directly attributable and identifiable to business segments, are apportioned on the basis of average of unallocated premium, premium received in advance, reserves for unexpired risks and outstanding claims of the respective segments

Allocation of operating expenses relating to business segments

Expenses other than those related to Insurance Business and those incurred towards creating long-term value and enhancing long term value for shareholders have been charged to Profit & Loss Account.

Operating expenses which are directly attributable and identifiable to business segments are allocated to the respective business segments.

Operating Expenses related to Insurance Business, which are not directly attributable and identifiable to business segments, are allocated between product classes / business group they relates to and apportioned basis suitable expense driver such as net written premium, gross written premium, group size count and number of policies at such product class / group level.

Segment revenue & results have been disclosed in the Revenue accounts.

T. Earnings per share (EPS)

Earnings considered for calculating EPS comprises net profit or loss after tax. The number of shares used in computing basic EPS is weighted average number of shares outstanding during the reporting period.

The number of shares used in computing diluted EPS comprises of weighted average number of shares considered for deriving basic EPS and also weighted average number of equity shares which could have been issued on conversion of all dilutive potential equity shares.In computing diluted earnings per share only potential equity shares that are dilutive are considered.

Dilutive potential equity shares are deemed to be converted as at the beginning of the period unless issued at a later date. The dilutive potential equity shares are adjusted for the Unamortised cost, proceeds receivable had the shares been actually issued at fair value, being average of closing rate quoted daily during the last six months period at NSE. Dilutive potential equity shares are determined independently for each period presented.

Potential equity shares are deemed to be dilutive only if their conversion to equity shares would decrease net profit per share from continuing ordinary operations.

U. Provisions and contingencies

A provision is recognised when the Company has a present legal obligation as a result of a past event and it is probable that an outflow of resources will be required to settle the obligation, in respect of which a reliable estimate can be made. Provisions, excluding retirement benefits, are not discounted to their present value and are determined based on the best estimate required to settle the obligation at the balance sheet date. These are reviewed at each balance sheet date and adjusted to reflect the current best estimates.

Contingent losses arising from claims other than insurance claims, litigation, assessment, fines, penalties, etc. are recorded when it is probable that a liability has been incurred and the amount can be reasonably estimated.

A disclosure for a contingent liability, other than those under policies, is made when there is a possible obligation or a present obligation that may not result in an outflow of resources.

Show cause notices / summons issued by various government authorities are not considered as obligations. When demand notices are raised against such show cause notices and are disputed by the Company, these are classified as disputed obligations.

When there is a possible obligation or a present obligation, in respect of which, the likelihood of outflow of resources is remote, no provision or disclosure is made.

Contingent liabilities are not recognised in the Financial Statements.

Contingent assets are neither recognised nor disclosed in the Financial Statements.

V. Receipts and payments account & cash and cash equivalents

Receipts and Payments Account has been prepared as prescribed by IRDAI (Actuarial, Finance and Investment Functions of Insurers) Regulations, 2024 under the ‘Direct method’ in accordance with Accounting Standard 3 on Cash Flow Statements notified under the Section 133 of the Companies Act.

Cash and cash equivalents Cash comprises cash on hand, cheques on hand and demand deposits with banks. Cash equivalents are term deposits with an original maturity of three months or less from the date of acquisition, highly liquid investments that are readily convertible into known amount of cash and which are subject to an insignificant risk of change in value.

W. Expenses related to issue of securities

Expenses related to issue of Securities are adjusted against the share premium (securities premium) account as per section 52 of Companies Act, 2013.