(k) Provisions and contingencies
A provision is recognized when the Company has a present obligation as a result of past event; 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 are not
discounted to their present value and are determined based on 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.
Provisions for onerous contracts, i.e. contracts where the expected unavoidable costs of meeting the obligations under the
contract exceed the economic benefits expected to be received under it, are recognized when it is probable that an outflow
of resources embodying economic benefits will be required to settle a present obligation as a result of an obligating event,
based on a best estimate of such obligation.
Where no reliable estimate can be made, a disclosure is made as contingent liability. A disclosure for a contingent liability
is also made when there is a possible obligation or a present obligation that may, but probably will not, require an outflow
of resources. A contingent asset is neither recognized nor disclosed in the financial statements.
(l) Warranty
Provision for warranty related costs are recognized when the license is provided or service provided. Provision is based on
historical experience. The estimate of such warranty related costs is revised periodically.
(m) Cash and cash equivalents
Cash and cash equivalents in the cash flow statement comprise of cash at bank and in hand and short term investments
with an original maturity value of three months or less. The cash flow statement is prepared under the indirect method.
(n) Stock compensation expense
Measurement and disclosure of the employee share-based payment plans is done in accordance with Ind AS 102 share
based payments. The Company accounts for stock compensation expense based on the fair value of the options granted,
determined on the date of grant. Compensation expense is amortized over the vesting period of the option on a straight-line
basis. The accounting value of the options outstanding net of the deferred compensation expense is reflected as employee
stock options outstanding.
Recent Indian Accounting Standards (Ind AS)
Ministry of Corporate Affairs (“MCA") notifies new standards or amendments to the existing standards under Companies (Indian
Accounting Standards) Rules as issued from time to time. For the year ended March 31, 2025, MCA has not notified any new standards
or amendments to the existing standards applicable to the Company.
(c) Rights, preferences and restrictions attached to equity shares:
The Company has only one class of equity shares having a par value of ' 10 per share. Accordingly, all equity shares rank
equally with regard to dividends and share in the Company's residual assets. The holders of equity shares are entitled
to receive dividend as declared from time to time. The dividend if any proposed by the Board of Directors is subject to
shareholders' approval at the ensuing Annual General Meeting. The voting rights of an equity shareholder on a poll (not on
show of hands) are in proportion to its share of the paid-up capital of the Company. Voting rights cannot be exercised in
respect of shares on which any call or other sums presently payable have not been paid.
Failure to pay any amount called up on shares may lead to forfeiture of the shares. On winding up of the Company, the
holders of equity shares will be entitled to receive the residual assets of the Company, remaining after distribution of all
preferential amounts in proportion to the number of equity shares held.
(h) Restricted Stock Units (RSUs):
The Sasken Employees' Share Based Incentive Plan 2016 (Plan) was duly approved and instituted in December, 2016.
The Plan authorizes the Board of Directors of the Company to offer share based incentive to eligible employees of the
Company and its subsidiaries. The maximum number of shares to be granted under the Plan will be in accordance with SEBI
(Employee Share Based Payments and Sweat Equity) Regulations, 2021 and other applicable regulations.
The above grants have been made to identified employees of the Company on January 13, 2022; May 26, 2022; October
19, 2022; November 4, 2022; April 3, 2023 and October 13, 2023. These shall vest as per the vesting schedule of 2 years
as approved by the Committee and can be exercised over the exercise period of 3 years as approved by them.
During the year ended March 31 2025, No new RSUs were granted, 23,550 RSUs lapsed due to non-meeting of vesting
conditions, totally 54,740 RSUs vested, out of which 43,640 RSUs were exercised during the year. The employee share
based compensation cost of ' 380.26 lakhs charged to the profit or loss (for the year ended March 31, 2024: ' 533.57
lakhs).
* Includes amounts paid to Government on account of income-tax litigations.
Deferred taxes on unrealized mark to market gain / loss relating to cash flow hedges, fair value changes on instruments at
FVTOCI and actuarial gains / losses on defined benefit plans are recognized in Other Comprehensive Income and presented
within equity. Other than these, the change in deferred tax assets and liabilities is recorded in the Statement of Profit and
Loss.
In assessing the realizability of deferred tax assets, the Company considers the extent to which it is probable that the
deferred tax asset will be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future
taxable profits during the periods in which those temporary differences and tax loss carryforwards become deductible.
The Company considers the expected reversal of deferred tax liabilities, projected future taxable income and tax planning
strategies in making this assessment. Based on this, the Company believes that it is probable that the Company will realize
the benefits of these deductible differences. The amount of deferred tax asset considered realizable, however, could be
reduced in the near term if the estimates of future taxable income during the carry-forward period are reduced.
The Company has provided for income taxes at the rates provided in Section 115BAA of the Income Tax Act, 1961 for the
year ended March 31, 2025.
26. Earnings per share (EPS)
Basic EPS is calculated by dividing the profit for the year attributable to equity holders of the Company by the weighted average
number of equity shares outstanding during the year. Diluted EPS is calculated by dividing the profit attributable to equity
holders of the Company and the weighted average number of equity shares outstanding, after adjustment for the effects of all
dilutive potential equity shares.
The remaining performance obligation disclosure provides the aggregate amount of the transaction price yet to be
recognized as at the end of the reporting period and an explanation as to when the Company expects to recognize these
amounts in revenue. Applying the practical expedient as given in Ind AS 115, the Company has not disclosed the remaining
performance obligation related disclosures for contracts where the revenue recognized corresponds directly with the value
to the customer of the entity's performance completed to date, typically those contracts where invoicing is on time-and-
material. Remaining performance obligation estimates are subject to change and are affected by several factors, including
terminations, changes in the scope of contracts, periodic revalidations, adjustment for revenue that has not materialized
and adjustments for currency fluctuations.
The aggregate value of performance obligations that are completely or partially unsatisfied out of the purchase orders
received, other than those meeting the exclusion criteria mentioned above, is ' 244.17 lakhs as at March 31, 2025 (' 723.91
lakhs as at March 31, 2024). Out of this, the Company expects to recognize majority of the revenues in next year.
30. Employee benefits
Defined contribution plan:
Pension Fund and Superannuation
The Company makes contributions to the Government administered pension fund, determined as a specified percentage of
employee salaries, in respect of qualifying employees towards Provident fund, which is a defined contribution plan. Further, the
Company also contributes to a superannuation scheme, maintained by an insurance company. To the extent of such contributions,
the Company has no obligation other than to make the specified contributions. The contributions are charged to the statement
of profit and loss as they accrue. The amount recognized as an expense towards contributions for year ended March 31, 2025
' 125.75 lakhs respectively (for the year ended March 31, 2024'114.84 lakhs).
Defined benefit plan:
(a) Provident Fund
The following table sets out the funded status of defined benefit provident fund plan of Sasken Technologies Limited and
amount recognized in the Company's financial statements as at March 31, 2025
The amount recognized as an expense towards contribution to this plan for the period ended March 31, 2025 aggregated
to ' 1,126.27 lakhs (March 31, 2024'826.33 lakhs), the Company has recognized in other comprehensive income for the
period ended March 31, 2025'116.42 lakhs (March 31, 2024'121.48 lakhs) respectively.
(b) Gratuity
The Company operates a post employment benefit plan that provides for gratuity benefit to the employees of the Company.
The gratuity plan entitles an employee, who has rendered at least five years of continuous service, to receive one-half
month's salary for each year of completed service at the time of retirement / exit. Further, in case of the branch in Germany,
pension contributions are also made as per the local laws and regulations. The Company provides for these pension
benefits, a defined benefit plan, covering all eligible employees.
The discount rate is based on the prevailing market yields of government securities for the estimated term of the obligations.
The expected return on plan assets is based on expectation of the average long term rate of return expected on investments
of the fund during the estimated term of the obligations.
31. Financial instruments - fair values and risk management
Fair value hierarchy
Level 1 - Quoted prices (unadjusted) in active markets for identical assets or liabilities.
Level 2 - Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e.
as prices) or indirectly (i.e. derived from prices).
Level 3 - Inputs for the assets or liabilities that are not based on observable market data (unobservable inputs).
The cost of unquoted investments included in Level 3 of fair value hierarchy approximate their fair value because the cost
represents estimate of fair value.
The Company has determined the fair value based on the recent transaction price.
There have been no transfers among Level 1, Level 2 and Level 3 investments during the year.
B. Financial risk management
The Company has exposure to the following risks arising from financial instruments:
• Credit risk;
• Liquidity risk; and
• Market risk
i. Risk management framework
The Company's principal financial liabilities comprise trade payables, other payables and unpaid dividend. The main purpose
of these financial liabilities is to finance the Company's operations. The Company's principal financial assets include trade
receivables, cash and cash equivalents and unbilled revenues that derive directly from its operations.
The Company's activities expose it to a variety of financial risks: market risk, credit risk and liquidity risk. The Company's
primary focus is to foresee the unpredictability of financial markets and seek to minimize potential adverse effects on its
financial performance. The primary market risk for the Company pertains to investing activities. The Company's exposure
to credit risk is influenced mainly by the individual characteristic of customers and counterparties to derivative instruments
such as banks.
ii. Credit risk
Credit risk is the risk of financial loss to the Company if a customer or counterparty to a financial instrument fails to meet
its contractual obligations, and arises principally from the Company's receivables from customers and investments in debt
securities.
Credit risk refers to the risk of default on its obligation by the counterparty resulting in a financial loss. The maximum
exposure to the credit risk at the reporting date is primarily from trade receivables amounting to ' 9,295.32 lakhs and
' 5,145.19 lakhs as of March 31, 2025 and March 31, 2024, respectively and unbilled revenues amounting to ' 2,721.47
lakhs and ' 2,054.94 lakhs as of March 31, 2025 and March 31, 2024 respectively. Credit risk has always been managed
by the Company through credit approvals, establishing credit limits and continuously monitoring the creditworthiness of
customers to which the Company grants credit terms in the normal course of business. As per Ind AS 109, the Company
uses expected credit loss model to assess the impairment loss or gain. The Company uses a provision matrix to compute
the expected credit loss allowance for trade receivables and unbilled revenues.
The carrying amount of the following financial assets represents the maximum credit exposure:
Trade receivables
The Company's exposure to credit risk is influenced mainly by the individual characteristics of each customer. However,
management also considers the factors that may influence the credit risk of its customer base, including the default risk of
the industry and country in which customers operate.
Credit risk arises from the possibility that customers may not be able to settle their obligations as agreed. The Company
establishes an allowance for impairment that best represents its estimate of expected losses in respect of trade receivables.
The Company has established a credit policy under which each new customer is analyzed individually for credit worthiness
before the standard payment and delivery terms and conditions are offered. The balance outstanding of trade receivable is
less than 180 days.
Cash and bank balances
The Company held cash and bank balances of ' 1,456.02 lakhs at March 31, 2025 (March 31, 2024: ' 1,179.96 lakhs).
Derivatives
The derivatives are entered with banks being counterparty.
iii. Liquidity risk
Liquidity risk is the risk that the Company will encounter difficulties in meeting the obligations associated with its financial
liabilities that are settled by delivering cash or another financial asset. The Company's approach to managing liquidity is
to ensure, as far as possible, that it will have sufficient liquidity to meet its liabilities when they are due, under both normal
and stressed conditions, without incurring unacceptable losses or risking damage to the Company's reputation.
The Company's principal sources of liquidity are cash and cash equivalents and the cash flow that is generated from
operations. The Company has no outstanding bank borrowings. The Company believes that the working capital is sufficient
to meet its current requirements. Accordingly, no liquidity risk is perceived.
Exposure to liquidity risk
The following are the remaining contractual maturities of financial liabilities at the reporting date. The amounts are gross
and undiscounted, and include estimated interest payments and exclude the impact of netting agreements.
iv. Market risk
Market risk is the risk that changes in market prices - such as foreign exchange rates, interest rates and equity prices -
will affect the Company's income or the value of its holdings of financial instruments. Market risk is attributable to all
market risk sensitive financial instruments including foreign currency receivables and payables. The Company is exposed to
market risk primarily related to the market value of its investments. Thus, the exposure to market risk is primarily related to
investing activities. The objective of market risk management is to diversity our portfolio according to nature of investments
to mitigate risks.
v. Currency risk
The Company is exposed to currency risk on account of export of services in foreign currency. The functional currency of
the Company is Indian Rupee. The summary quantitative data about the Company's exposure to currency risk from non¬
derivative financial instrument is as follows:
Sensitivity Analysis
A reasonably possible strengthening / (weakening) of the INR, US Dollar, Euro and all other currencies as at March 31, 2025
would have affected the measurement of financial instruments denominated in a foreign currency and affected equity and
profit or loss by the amounts shown below. This analysis assumes that all other variables, in a particular interest rates,
remain constant and ignores any impact of forecast sales and purchases.
The related hedge transactions for balance is cash flow hedging reserves as of March 31, 2025 are expected to occur and
be re-classified to the Statement of Profit and Loss over next year.
As of March 31, 2025 and March 31, 2024, there were no significant gains or losses on derivative transactions or portions
thereof that have become ineffective as hedges, or associated with an underlying exposure that did not occur.
32. Capital management
The Company's policy is to maintain a strong capital base so as to maintain investor, creditor and market confidence and to
sustain future development of the business. Management monitors the return on capital as well as the level of dividends to
equity shareholders.
The Company monitors capital using a ratio of 'adjusted net debt' to 'adjusted equity'. For this purpose, adjusted net debt
is defined as total liabilities less cash and cash equivalents. Adjusted equity comprises all components of equity, other than
amounts accumulated in the hedging reserve.
*The Company is contesting the demands and based on expert advice, the management believes that its position will likely be
upheld in the various appellate authorities / courts. The Company is subject to legal proceedings and claims, which have arisen in
the ordinary course of business. The Company's Management does not reasonably expect that these legal actions, when ultimately
concluded and determined, will have a material and adverse effect on the Company's results of operations or financial condition.
The Company has been sanctioned a non-fund based credit facility ' 500 lakhs by Citibank NA. The Company has availed bank
guarantee of ' 13.82 Lakhs with Union Bank of India. The Company has not utilised any working capital limits and is not required
to submit periodic statement of stock and book debts.
34. Dues to Micro, Small and Medium Enterprises
The Ministry of Micro, Small and Medium Enterprises has issued an office memorandum dated August 26, 2008 which
recommends that the Micro and Small Enterprises should mention in their correspondence with its customers the Entrepreneurs
Memorandum Number as allocated after filing of the Memorandum in accordance with the 'Micro, Small and Medium Enterprises
Development Act, 2006 ('the MSMED Act'). Accordingly, the disclosure in respect of the amounts payable to such enterprises
as at March 31, 2025 has been made in the standalone financial statements based on information received and available with
the Company. Further in view of the Management, the impact of interest, if any, that may be payable in accordance with the
provisions of the MSMED Act is not expected to be material. The Company has not received any claim for interest from any
supplier as at the Balance Sheet date.
37. The Company:
a) does not have any Benami property, where any proceeding has been initiated or pending against the Company for holding
any Benami property.
b) does not have any transactions with companies struck off under Section 248 of the Companies Act, 2013 or Section 560 of
Companies Act, 1956.
c) has complied with the number of layers prescribed under clause (87) of Section 2 of the Act read with the Companies
(Restriction on number of Layers) Rules, 2017.
d) does not have any undisclosed income which is not recorded in the books of account that has been surrendered or disclosed
as income during the year in the tax assessments under the Income Tax Act, 1961.
e) has not traded or invested in crypto currency or virtual currency during the financial year.
As per our report of even date attached.
For M S K A & Associates For and on behalf of the Board of Directors of
Chartered Accountants Sasken Technologies Limited
Firm's Registration Number: 105047W
Manish P Bathija Rajiv C. Mody
Partner Chairman, Managing Director and CEO
Membership No.216706 DIN: 00092037
Priyaranjan Paawan Bhargava
Chief Financial Officer Company Secretary
Bengaluru Bengaluru
April 25, 2025 April 25, 2025
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