2 Material accounting policies

2.1 Basis of preparation of financial statements

These Standalone financial statements are prepared in accordance with Indian Accounting Standard (Ind AS) under
the historical cost convention on accrual basis except for certain financial instruments, which are measured at
fair values, the provisions of the Companies Act, 2013 (''the Act'') and guidelines issued by the Securities and
Exchange Board of India (SEBI). The Ind AS are prescribed under Section 133 of the Act read with Rule 3 of the
Companies (Indian Accounting Standards) Rules, 2015 and relevant amendment rules issued thereafter.

These financial statements have been prepared in Indian Rupee which is also the functional currency of the
Company and all values are rounded to the Lakhs, except when otherwise indicated. These financial statements
have been prepared on historical cost basis, except for certain financial assets and liabilities which are measured
at fair value or amortised cost at the end of each reporting period, as exp lained in the accounting policies below.

As the year to date figures are taken from the source and rounded to the nearest digits, the figures reported for
the previous quarters might not always add up to the year to date figures reported in this statement.

2.2 Significant accounting judgements, estimates and assumptions

The preparation of the Company’s standalone financial statements requires management to make judgements,
estimates and assumptions that affect the reported amounts of revenues, expenses, assets and liabilities, and
the accompanying disclosures, and the disclosure of contingent liabilities. Uncertainty about these assumptions
and estimates could result in outcomes that require a material adjustment to the carrying amount of assets or
liabilities affected in future periods.

Critical accounting estimates

i. Taxes

Deferred tax assets are recognized to the extent that it is probable that taxable profit will be available against
which the same can be utilised. Significant management judgement is required to determine the amount of
deferred tax assets that can be recognised, based upon the likely timing and the level of future taxable profits
together with future tax planning strategies.

ii. Provisions and Contingent Liability

The timing of recognition and quantification of the liability (including litigations) requires the application of
judgement to existing facts and circumstances, which can be subject to change. The carrying amounts of
provisions and liabilities are reviewed regularly and revised to take accou nt of c hanging facts and circumstances.

2.3 Summary of material accounting policies
(a) Current versus non-current classification

The Company presents assets and liabilities in the standalone balance sheet based on current/ non-current
classification.

An asset is treated as current when it is:

i. Expected to be realised or intended to be sold or consumed in normal operating cycle,

ii. Held primarily for the purpose of trading,

iii. Expected to be realised within twelve months after the reporting period, or

iv. 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 current when:

i. It is expected to be settled in the company’s normal operating cycle;

ii. It is held primarily for the purpose of being traded;

iii. It is due to be settled within twelve months after the reporting date; or

iv. The company does not have an unconditional right to defer settlement of the liability for at least twelve
months after the reporting date. Terms of a liability that could, at the option of the counterparty, result in its
settlement by the issue of equity instruments do not affect its classification.

All other liabilities are classified as non-current.

Deferred tax assets and liabilities are classified as non current assets and liabilities.

Operating cycle for current and non-current classification

Operating cycle is the time between the acquisition of assets for processing and their realisation in cash or cash
equivalents. The company has taken Operating cycle to be twelve months.

(b) Foreign currencies

The financial statements are presented in Indian rupees, which is the functional currency of the Company and
the currency of the primary economic environment in which the Compan / operates.

Transactions and balances

Transactions in foreign currencies are initially recorded by the Company at its functional currency spot rates at
the date the transaction first qualifies for recognition. Monetary assets and liabilities denominated in foreign
currencies are translated at the functional currency spot rates of exchange at the reporting date. Non-monetary
items that are measured in terms of historical cost in a foreign currency are translated using the exchange rates
at the dates of the initial transactions.

Exchange differences arising on settlement or translation of monetary items are recognised in Statement of Profit
and Loss.

2.4 Fair value measurement of financial instruments

The Company measures financial instruments, such as, Investments at fair value at each balance sheet date using
valuation techniques. 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 p resumption that the transaction to sell the asset or transfer the liability takes place either:

a) In the principal market for the asset or liability, or

b) In the absence of a principal market, in t he most advantageous market for the asset or liability

The principal or the most advantageous market must be accessible by the Company. The fair value of an asset or
a liability is measured using the assumptions that market participants would use when pricing the asset or liability,
assuming that market participants act in their economic best interest.

A fair value measurement of a non-financial asset takes into account a market participant’s ability to generate
economic benefits by using the asset in its highest and best use or by selling it to another market participant that
would use the asset in its highest and best use.

The Company uses valuation techniques that are appropriate in the circumstances and for which sufficient data
are available to measure fair value, maximising the use of relevant observable inputs and minimising the use of
unobservable inputs.

All assets and liabilities for which fair value is measured or disclosed in the standalone financial statements are
categorised within the fair value hierarchy, described as follows, based on the lowest level input that is significant
to the fair value measurement as a whole:

Level 1 - Quoted (unadjusted) market prices in active markets for identical assets or liabilities

Level 2 - Valuation techniques for which the lowest level input that is significant to the fair value measurement
is directly or indirectly observable

Level 3 - Valuation techniques for which the lowest level input that is significant to the fair value measurement
is unobservable For assets and liabilities that are recognised in the standalone financial statements on a recurring
basis, the Company determines whether transfers have occurred between levels in the hierarchy by re-assessing
categorisation (based on the lowest level input that is significant to the fair value measurement as a whole) at
the end of each reporting period.

For assets and liabilities that are recognised in the standalone financial statements on a recurring basis, the
Company determines whether transfers have occurred between levels in the hierarchy by re-assessing
categorisation (based on the lowest level input that is significant to the fair value measurement as a whole) at
the end of each reporting period.

For the purpose of fair value disclosures, the Company has determined classes of assets and liabilities on the
basis of the nature, characteristics and risks of the asset or liability and the level of the fair value hierarchy as
explained above.

2.5 Property, Plant and Equipment

Property, plant and equipment are stated at cost, less accumulated depreciation and accumulated impairment
losses, if any. The cost comprises purchase price, borrowing costs if capitalization criteria are met, directly
attributable cost of bringing the asset to its working condition for the intended use and initial estimate of
decommissioning, restoring and similar liabilities. Any trade discounts and rebates are deducted in arriving at the
purchase price. Such cost includes the cost of replacing part of the plant and equipment. When significant parts
of plant and equipment are required to be replaced at intervals, the Company depreciates them separately based
on their specific useful lives. Likewise, when a major inspection is performed, its cost is recognised in the carrying
amount of the plant and equipment as a replacement if the recognition criteria are satisfied. All other repair and
maintenance costs are recognised in profit or loss as incurred.

In case an item of property, plant and equipment is acquired on deferred payment basis, interest expenses
included in deferred payment is recognized as interest expense and not i nclude d in cost of asset

Gains or losses arising from derecognition of Property, plant and equipment 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 derecogniz ed.

2.6 Intangible asset

Intangible assets acquired separately are measured on initial recognition at cost. The cost of intangible assets
acquired in a business combination is their fair value at the date of acquisition. Following initial recognition,
intangible assets are carried at cost less any accumulated amortisation and accumulated impairment losses. The
useful lives of intangible assets are assessed as either finite or indefinite. Intangible assets with finite lives are
amortised over the useful economic life and assessed for impairment whenever there is an indication that the
intangible asset may be impaired. The amortisation period and the amortisation method for an intangible asset
with a finite useful life are reviewed at least at the end of each reporting period with the affect of any change
in the estimate being accounted for on a prospective basis. Changes in the expected useful life or the expected
pattern of consumption of future economic benefits embodied in the asset are considered to modify the
amortisation period or method, as appropriate, and are treated as changes in accounting estimates. The
amortisation expense on intangible assets with finite lives is recognised in the statement of profit and loss unless
such expenditu re forms part of carrying value of another asset.

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.

2.7 Depreciation and Amortization

Depreciation on Property, plant and equipment is provided on the straight-line basis over the useful lives of assets
specified in Schedule II to the Companies Act, 2013.

Software being intangible asset is amortised on straight-line basis over a period of 4years.

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. The amortization period and the amortization
method are reviewed at least at each financial year end.

2.8 Impairment of Financial and Non-Financial Assets

The impairment provisions for Financial Assets are based on assumptions about risk of default and expected cash
loss rates. The Company uses judgement in making these assumptions and selecting the inputs to the impairment
calculation, based on Company’s past history, existing market conditions as well as forward looking estimates at
the end of each reporting period.

In case of non-financial assets, assessment of impairment indicators involves consideration of future risks.
Further, the company estimates asset’s recoverable amount, which is higher of an asset’s or Cash Generating
Units (CGU’s) fair value less costs of disposal and its value in use.

In assessing value in use, the estimated future cash flows are discounted to their present value using pre-tax
discount rate that reflects current market assessments of the time value of money and the risks specific to the
asset. In determining fair value less costs of disposal, recent market transactions are taken into account, if no
such transactions can be identified, an appropriate valuation model is used.

2.9 Revenue Recognition

The Company derives revenues primarily from trading in commodities and IT services comprising software
development and its related services.

Revenue from operation

Revenue towards satisfaction of a performance obligation is measured at the amount of transaction price (net of
variable consideration) allocated to that performance obligation. The transaction price of goods sold and services
rendered is net of variable consideration on account of various discounts and schemes offered by the Company
as part of the contract.

Contract balances

i. Trade receivables

The amounts billed on customer for work performed and are unconditionally due for payment i.e. only passage of
time is required before payment falls due, are disclosed in the balance sheet as trade receivables.

ii. Contract liabilities

A contract liability is the obligation to transfer goods or services to a customer for which the Company has received
consideration or is due from the customer. If a customer pays consideration before the Company transfers goods or
services to the customer, a contract liability is recognised when the payment is made or the payment is due
(whichever is earlier).

Contract liabilities are recognised as revenue when the Company performs under the contract.

Interest income

Interest income from a financi al assets is rec ognised using e ffective interest rate m ethod wherever a pplicable.
Dividend

Dividend from investments is recognised when the right to receive the payment is established and when no significant
uncertainty as to measurability or collectability exists.

2.10 Taxes on income
Current income tax

Tax expense for the year comprises current and deferred tax. The tax currently payable is based on taxable profit
for the year. Taxable profit differs from net profit as reported in the standalone statement of profit and loss because
it excludes items of income or expense that are taxable or deductible in other years and it further excludes items
that are never taxable or deductible. The Company’s liability for current tax is calculated using the tax rates and
tax laws that have been enacted or substantively enacted by the end of the reporting period.

Current income tax relating to items recognised outside profit or loss is recognised outside profit or loss (either in
other comprehensive income or in equity). Current tax items are recognised in correlation to the underlying
transaction either in OCI or directly in equity. Management periodically evaluates positions taken in the tax returns
with respect to situations in which applicable tax regulations are subject to interpretation and establishes provisions
where appropriate.

Deferred tax

Deferred tax is provided using the liability method on temporary differences between the tax bases of assets and
liabilities and their carrying amounts for financial reporting purposes at the reporting date.

Deferred tax liabilities are recognised for all taxable
temporary differences, except:

i. When the deferred tax liability arises from the initial recognition of goodwill or an asset or liability in a transaction
that is not a business combination and, at the time of the transaction, affects neither the accounting profit nor
taxable profit or loss.

ii. In respect of taxable temporary differences associated with investments in subsidiary and interests in joint
ventures, when the timing of the reversal of the temporary differences can be controlled and it is probable that the
temporary differences will not reverse in the foreseeable future.

Deferred tax assets are recognised for all deductible temporary differences, the carry forward of unused tax credits
and any unused tax losses. Deferred tax assets are recognised to the extent that it is probable that taxable profit
will be available against which the deductible temporary differences, and the carry forward of unused tax credits
and unused tax losses can be utilised, except:

i. When the deferred tax asset relating to the deductible temporary difference arises from the initial recognition of
an asset or liability in a transaction that is not a business combination and, at the time of the transaction, affects
neither the accounting profit nor taxable profit or loss.

ii. In respect of deductible temporary differences associated with investments in subsidiaries, associates and
interests in joint ventures, deferred tax assets are recognised only to the extent that it is probable that the
temporary differences will reverse in the foreseeable future and taxable profit will be available against which the
temporary differences can be utilised.

The carrying amount of deferred tax assets is reviewed at each reporting date and reduced to the extent that it is
no longer probable that sufficient taxable profit will be available to allow all or part of the deferred tax asset to be
utilised. Unrecognised deferred tax assets are re-assessed at each reporting date and are recognised to the extent
that it has become probable that future taxable profits will allow the deferred tax asset to be recovered.

Deferred tax assets and liabilities are measured at the tax rates that are expected to apply in the year when the
asset is realised or the liability is settled, based on tax rates (and tax laws) that have been enacted or substantively
enacted at the reporting date.

Deferred tax relating to items recognised outside profit or loss is recognised outside profit or loss (either in other
comprehensive income or in equity). Deferred tax items are recognised in correlation to the underlying transaction
either in OCI or directly in equity.

Deferred tax assets and deferred tax liabilities are offset if a legally enforceable right exists to set off current tax
assets against current tax liabilities and the deferred taxes relate to the same taxable entity and the same taxation
authority.

All other acquired tax benefits realised are recognised in profit or loss.

2.11 Earnings Per Share

Basic earnings per equity share is computed by dividing the net profit attributable to the equity share holders of the
Company by the weighted average number of equity shares outstanding during the period. The weighted average
number of equity shares outstanding during the period is adjusted for events such as fresh issue, bonus issue that
have changed the number of equity shares outstanding, without a corresponding change in resources.

Diluted earnings per equity share is computed by dividing the net profit attributable to the equity shares holders of
the Company by the weighted average number of equity shares considered for deriving basic earnings per equity
share and also the weighted average number of equity shares that could have been issued upon conversion of all
dilutive potential equity shares. Potential equity shares are deemed to be dilutive only if their conversion to equity
shares would decrease the net profit per share from continuing ordinary operations. Potential dilutive equity shares
are deemed to be converted as at the beginning of the period, unless they have been issued at a later date. Dilutive
potential equity shares are determine d independe ntly for each period presented.

2.12 Leases

Where the Company is lessee

The Company applies a single recognition and measurement approach for all leases, except for short-term leases
and leases of low-value assets. The Company recognises lease liabilities to make lease payments and right-of-use
assets representing the right to use the underlying assets.

i) Right-of-use asset

The Company recognises right-of-use assets at the commencement date of the lease (i.e., the date the underlying
asset is available for use). Right-of-use assets are measured at cost, less any accumulated depreciation and
impairment losses, and adjusted for any remeasurement of lease liabilities. The cost of right-of-use assets includes
the amount of lease liabilities recognised, initial direct costs incurred, and lease payments made at or before the
commencement date less any lease incentives received. Right-of-use assets are depreciated on a straight-line basis
over the shorter of the lease term and the estimated useful lives of the assets.
The right-of-use assets are also subject to impairment.

ii) Lease Liabilities

At the commencement date of the lease, the company recognises lease liabilities measured at the present value of
lease payments to be made over the lease term. The lease payments include fixed payments (including in substance
fixed payments) less any lease incentives receivable, variable lease payments that depend on an index or a rate,
and amounts expected to be paid under residual value guarantees. The lease payments also include the exercise
price of a purchase option reasonably certain to be exercised by the Company and payments of penalties for
terminating the lease, if the lease term reflects the Company exercising the option to terminate. Variable lease
payments that do not depend on an index or a rate are recognised as expenses (unless they are incurred to produce
inventories) in the period in which the event or condition that triggers the payment occurs.

In calculating the present value of lease payments, the Company uses its incremental borrowing rate at the lease
commencement date because the interest rate implicit in the lease is not readily determinable. After the
commencement date, the amount of lease liabilities is increased to reflect the accretion of interest and reduced for
the lease payments made. In addition, the carrying amount of lease liabilities is remeasured if there is a modification,
a change in the lease term, a change in the lease payments (e.g., changes to future payments resulting from a
change in an index or rate used to determine such lease payments) or a change in the assessment of an option to
purchase the underlying asset

iii) Short-term leases and leases of low-value assets

The Company applies the short-term lease recognition exemption to its short-term leases (i.e., those leases that
have a lease term of 12 months or less from the commencement date and do not contain a purchase option). It also
applies the lease of low-value assets recognition exemption to leases of office equipment that are considered to be
low value. Lease payments on short-term leases and leases of low-value assets are recognised as expense on a
straight-line basis over the lease term .

2.13 Foreign currencies transactions and translation

The Company’s financial statements are presented in Indian Rupee, which is also the Company’s functional currency.
In preparing the financial statements, transactions in the currencies other than the Company’s functional currency
are recorded at the rates of exchange prevailing on the date of transaction. At the end of each reporting period,
monetary items denominated in the foreign currencies are re-translated at the rates prevailing at the end of the
reporting period. Non-monetary items carried at fair value that are denominated in foreign currencies are
retranslated at the rates prevailing on the date when the fair value was determined. Non-monetary items are
measured in terms of historical cost in a foreign currency are not retranslated.

Exchange differences arising on the retranslation or settlement of other monetary items are included in the
statement o profit and loss for the period.

2.14 Cash and Cash equivalents

Cash and cash equivalent in the balance sheet comprise cash at banks and on hand and short-term deposits with an
original maturity of three months or less, which are subject to an insignificant risk of changes in value. For the
purpose of the statement of cash flows, cash and cash equivalents consist of cash and short-term deposits, as defined
above, net of outstanding bank overdrafts as they are considered an integral part of the Company’s cash
management.

2.15 Retirement and other employee benefits

Retirement benefit in the form of provident fund is a defined contribution scheme. The Company has no obligation,
other than the contribution payable to the provident fund. The Company recognises 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 recognised as a liability after deducting the contribution already paid. If the contribution
already paid exceeds the contribution due for services received before the balance sheet date, then excess is
recognised as an asset to the extent that the prepayment will lead to, for example, a reduction in future payment
or a cash refund.

The Company operates a defined benefit gratuity plan in India, which requires contributions to be made to a
separately administered fund by a third party.

The cost of providing benefits under the defined benefit plan is determined based on projected unit credit method.

Remeasurements, comprising of actuarial gains and losses, the effect of the asset ceiling, excluding amounts included
in net interest on the net defined benefit liability and the return on plan assets (excluding amounts included in net
interest on the net defined benefit liability), are recognised immediately in the balance sheet with a corresponding
debit or credit to retained earnings through OCI in the period in which they occur. Remeasurements are not
reclassified to Statement of Profit or Loss in subse quent perio s.

Net interest is calculated by applying the discount rate to the net defined benefit liability or asset. Past service costs
are recognised in profit or loss on the earlier of:

• The date of the plan amendment or curtailment, and

• The date that the Company recognises related restructuring costs

Net interest is calculated by applying the discount rate to the net defined benefit liability or asset. The Company
recognises the following changes in the net defined benefit obligation as an expense in the statement of profit and
loss:

• Service costs comprising current service costs, pastservice costs, gains and losses on curtailments and non-routine
settlements; and

• Net interest expense o income

Termination benefits

The Company recognizes termination benefit as a liability and an expense when the Company has a present obligation
as a result of past event, it is probable that an outflow of resources embodying economic benefits will be required
to settle the obligation and a reliable estimate can be made of the amount of the obligation. If the termination
benefits fall due more than 12 months after the balance sheet date, they are measured at present value of future
cash flows using the discount rate determined by reference to market yields at the balance sheet date on government
bonds.

Compensated Absences

The Company treats accumulated leave expected to be carried forward beyond twelve months, as long-term
employee benefit for measurement purposes. Such long-term compensated advances are provided for based on the
actuarial valuation using the projected unit credit method at the year-end. Remeasurement gains/losses on defined
benefit plans are immedi ately taken the Statement of Profi & Loss and are not def rred.