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Notes to Accounts of AXISCADES Technologies Ltd.

Mar 31, 2023

Provisions and contingencies

Provisions

A provision is recognised if, as a result of a past event, the
Company has a present legal or constructive obligation
that is reasonably estimable, and it is probable that an
outflow of economic benefits will be required to settle
the obligation. If the effect of the time value of money
is material, provisions are determined by discounting the
expected future cash flows at a pre-tax rate that reflects
current market assessments of the time value of money
and the risks specific to the liability. The increase in the
provision due to the passage of time is recognised as
interest expense.

Contingent liabilities

A contingent liability is a possible obligation that arises
from past events whose existence will be confirmed by the
occurrence or non-occurrence of one or more uncertain
future events not wholly within the control of the
Company or a present obligation that is not recognised
because it is not probable that an outflow of resources
will be required to settle the obligation or it cannot be
measured with sufficient reliability. The Company does not
recognise a contingent liability but discloses its existence
in the financial statements.

Contingent assets

Contingent assets are neither recognised nor disclosed.
However, when realisation of income is virtually certain,
related asset is recognised.

Onerous contracts

Present obligations arising under onerous contracts are
recognised and measured as provisions. An onerous
contract is considered to exist where the Company has
a contract under which the unavoidable costs of meeting
the obligations under the contract exceed the economic
benefits expected to be received from the contract.

o) Financial instruments

A financial instrument is any contract that gives rise to
a financial asset of one entity and a financial liability or
equity instrument of another entity.

Financial assets

Initial recognition and measurement

All financial assets are recognised initially at fair value and
transaction cost that is attributable to the acquisition of
the financial asset is also adjusted.

Subsequent measurement

For purposes of subsequent measurement, financial assets

are classified in four categories:

i. Debt instruments at amortised cost;

ii. Debt instruments at fair value through other
comprehensive income (FVTOCI);

iii. Debt instruments, derivatives and equity instruments
at fair value through profit or loss (FVTPL); and

iv. Equity investments.

i. Debt instruments at amortised cost

A ''debt instrument'' is measured at the amortised
cost if both the following conditions are met:

a) The asset is held within a business model
whose objective is to hold assets for collecting
contractual cash flows; and

b) Contractual terms of the asset give rise on
specified dates to cash flows that are solely
payments of principal and interest (SPPI) on the
principal amount outstanding.

This category is the most relevant to the
Company. After initial measurement, such
financial assets are subsequently measured at
amortised cost using the effective interest rate
(EIR) method. Amortised cost is calculated by
taking into account any discount or premium
on acquisition and fees or costs that are an
integral part of the EIR. The EIR amortisation
is included in finance income in the Statement
of Profit and Loss. The losses arising from
impairment are recognised in the Statement of
Profit and Loss. This category generally applies
to trade and other receivables.

ii. Debt instrument at FVTOCI

A ''debt instrument'' is classified as at the FVTOCI if
both of the following criteria are met:

a) The objective of the business model is achieved
both by collecting contractual cash flows and
selling the financial assets; and

b) The asset''s contractual cash flows represent
SPPI.

Debt instruments included within the FVTOCI
category are measured initially as well as at
each reporting date at fair value. Fair value
movements are recognized in the other
comprehensive income (OCI). However,
the Company recognizes interest income,
impairment losses and reversals and foreign
exchange gain or loss in the Statement of

Profit and Loss. On derecognition of the asset,
cumulative gain or loss previously recognised in
OCI is reclassified from the equity to Statement
of Profit and Loss. Interest earned whilst holding
FVTOCI debt instrument is reported as interest
income using the EIR method.

iii. Debt instrument at FVTPL

FVTPL is a residual category for debt instruments.
Any debt instrument, which does not meet the
criteria for categorization as at amortized cost
or as FVTOCI, is classified as at FVTPL.

In addition, the Company may elect to
designate a debt instrument, which otherwise
meets amortized cost or FVTOCI criteria, as at
FVTPL. However, such election is allowed only if
doing so reduces or eliminates a measurement
or recognition inconsistency (referred to as
''accounting mismatch''). The Company has not
designated any debt instrument as at FVTPL.

Debt instruments included within the FVTPL
category are measured at fair value with all
changes recognized in the Statement of Profit
and Loss.

iv. Equity investments

All equity investments in scope of Ind AS 109,
Financial Instruments, are measured at fair value.
Equity instruments which are held for trading
and contingent consideration recognised
by an acquirer in a business combination to
which Ind AS 103 Business Combinations,
applies are classified as at FVTPL. For all other
equity instruments, the Company may make
an irrevocable election to present in other
comprehensive income subsequent changes
in the fair value. The Company makes such
election on an instrument-by-instrument basis.
The classification is made on initial recognition
and is irrevocable.

If the Company decides to classify an equity
instrument as at FVTOCI, then all fair value
changes on the instrument, excluding dividends,
are recognized in the OCI. There is no recycling
of the amounts from OCI to Statement of Profit
and Loss, even on sale of investment. However,
the Company may transfer the cumulative gain
or loss within equity.

Equity instruments included within the FVTPL
category are measured at fair value with all
changes recognized in the Statement of Profit

and Loss.

De-recognition of financial assets

A financial asset (or, where applicable, a part of a
financial asset) is primarily derecognised (i.e. removed
from the Company''s balance sheet) when:

a. The rights to receive cash flows from the asset
have expired, or

b. The Company has transferred its rights to receive
cash flows from the asset or has assumed an
obligation to pay the received cash flows in full
without material delay to a third party under
a ''pass-through'' arrangement; and either (i)
the Company has transferred substantially all
the risks and rewards of the asset, or (ii) the
Company has neither transferred nor retained
substantially all the risks and rewards of the
asset, but has transferred control of the asset.

When the Company has transferred its rights to
receive cash flows from an asset or has entered into
a pass-through arrangement, it evaluates if and to
what extent it has retained the risks and rewards
of ownership. When it has neither transferred nor
retained substantially all of the risks and rewards of
the asset, nor transferred control of the asset, the
Company continues to recognise the transferred
asset to the extent of the Company''s continuing
involvement. In that case, the Company also
recognises an associated liability. The transferred
asset and the associated liability are measured on a
basis that reflects the rights and obligations that the
Company has retained.

Continuing involvement that takes the form of a
guarantee over the transferred asset is measured at
the lower of the original carrying amount of the asset
and the maximum amount of consideration that the
Company could be required to repay.

Financial liabilities

Initial recognition and measurement

Financial liabilities are classified, at initial recognition, as
financial liabilities at fair value through profit or loss, loans
and borrowings, payables, or as derivatives designated as
hedging instruments in an effective hedge, as appropriate.

All financial liabilities are recognised initially at fair value
and, in the case of loans and borrowings and payables,
net of directly attributable transaction costs.

The Company''s financial liabilities include trade and other
payables, loans and borrowings including bank overdrafts,
financial guarantee contracts and derivative financial

instruments.

Subsequent measurement

The measurement of financial liabilities depends on their
classification, as described below:

Financial liabilities at fair value through profit or loss

Financial liabilities at fair value through profit or loss
include financial liabilities held for trading and financial
liabilities designated upon initial recognition as at fair value
through profit or loss. Financial liabilities are classified as
held for trading if they are incurred for the purpose of
repurchasing in the near term. This category also includes
derivative financial instruments entered into by the
Company that are not designated as hedging instruments
in hedge relationships as defined by Ind AS 109, Financial
Instruments.

Gains or losses on liabilities held for trading are
recognised in the profit or loss.

Financial liabilities designated upon initial recognition at
fair value through profit or loss are designated as such at
the initial date of recognition, and only if the criteria in Ind
AS 109 are satisfied. For liabilities designated as FVTPL,
fair value gains/ losses attributable to changes in own
credit risk are recognized in OCI. These gains/ loss are not
subsequently transferred to Statement of Profit and Loss.
However, the Company may transfer the cumulative gain
or loss within equity. All other changes in fair value of such
liability are recognised in the Statement of Profit and Loss.
The Company has not designated any financial liability as
at fair value through profit and loss.

Loans and borrowings

This is the category most relevant to the Company. After
initial recognition, interest-bearing loans and borrowings
are subsequently measured at amortised cost using the EIR
method. Gains and losses are recognised in profit or loss
when the liabilities are derecognised as well as through
the EIR amortisation process.

Amortised cost is calculated by taking into account any
discount or premium on acquisition and fees or cost that
are an integral part of the EIR. The EIR amortisation is
included as finance costs in the Statement of Profit and
Loss.

Derecognition of financial liabilities

A financial liability is derecognised when the obligation
under the liability is discharged or cancelled or expires.
When an existing financial liability is replaced by another
from the same lender on substantially different terms, or
the terms of an existing liability are substantially modified,
such an exchange or modification is treated as the

derecognition of the original liability and the recognition
of a new liability. The difference in the respective carrying
amounts is recognised in the Statement of Profit and Loss.

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 recognised
amounts and there is an intention to settle on a net basis,
to realise the assets and settle the liabilities simultaneously.

Derivative financial instruments and Hedge
accounting

Initial recognition and subsequent measurement

The Company uses derivative financial instruments, such
as forward currency contracts to hedge its foreign currency
risks arising from highly probable future forecasted sales.
This derivative financial instrument are designated in a
cash flow hedge relationship. Such derivative financial
instruments are initially recognised at fair value on the
date on which a derivative contract is entered into and
are subsequently re-measured at fair value. Derivatives are
carried as financial assets when the fair value is positive
and as financial liabilities when the fair value is negative.

At the inception of a hedge relationship, the Company
formally designates and documents the hedge relationship
to which the Company wishes to apply hedge accounting
and the risk management objective and strategy for
undertaking the hedge. The documentation includes the
Company''s risk management objective and strategy for
undertaking hedge, the hedging/ economic relationship,
the hedged item or transaction, the nature of the risk
being hedged, hedge ratio and how the entity will assess
the effectiveness of changes in the hedging instrument''s
fair value in offsetting the exposure to changes in the
hedged item''s fair value or cash flows attributable to
the hedged risk. Such hedges are expected to be highly
effective in achieving offsetting changes in cash flows and
are assessed on an ongoing basis to determine that they
actually have been highly effective throughout the financial
reporting periods for which they were designated.

The effective portion of the gain or loss on the hedging
instrument is recognised in OCI in the cash flow hedge
reserve, while any ineffective portion is recognised
immediately in the Statement of Profit and Loss.

Any gains or losses arising from changes in the fair value
of derivatives are taken directly to profit or loss, except
for the effective portion of cash flow hedges, which
is recognised in OCI and later reclassified to profit or
loss when the hedge item affects profit or loss and is
reclassified to underlying hedged item.

p) Impairment of financial assets

In accordance with Ind AS 109 Financial Instruments,
the Company applies expected credit loss (ECL) model
for measurement and recognition of impairment loss for
financial assets.

The Company tracks credit risk and changes thereon for
each customer. For recognition of impairment loss on
other financial assets and risk exposure, the Company
determines that whether there has been a significant
increase in the credit risk since initial recognition. If
credit risk has not increased significantly, 12-month ECL
is used to provide for impairment loss. However, if credit
risk has increased significantly, life time ECL is used. If
in a subsequent period, credit quality of the instrument
improves such that there is no longer a significant increase
in risk since initial recognition, then the entity reverts
to recognising impairment loss allowance based on
12-month ECL.

ECL is the difference between all contractual cash flows
that are due to the Company in accordance with the
contract and all the cash flows that the entity expects to
receive (i.e., all cash shortfalls), discounted at the original
EIR. When estimating the cash flows, an entity is required
to consider:

- All contractual terms of the financial instrument
over the expected life of the financial instrument.
However, in rare cases when the expected life of the
financial instrument cannot be estimated reliably,
then the entity is required to use the remaining
contractual term of the financial instrument.

- Cash flows from the sale of collateral held or
other credit enhancements that are integral to the
contractual terms.

The Company uses default rate for credit risk to determine
impairment loss allowance on portfolio of its trade
receivables.

ECL impairment loss allowance (or reversal) recognized
during the period is recognized as income/ expense in
the Statement of Profit and Loss. This amount is reflected
under the head ''other expenses'' in the Statement of
Profit and Loss. The balance sheet presentation for various
financial instruments is described below:

a. Financial assets measured as at amortised
cost, contractual revenue receivables and lease
receivables: ECL is presented as an allowance, i.e., as
an integral part of the measurement of those assets
in the balance sheet. The allowance reduces the net
carrying amount. Until the asset meets write-off
criteria, the Company does not reduce impairment

allowance from the gross carrying amount.

b. Loan commitments and financial guarantee
contracts: ECL is presented as a provision in the
balance sheet, i.e. as a liability.

c. Debt instruments measured at FVTOCI: Since financial
assets are already reflected at fair value, impairment
allowance is not further reduced from its value.
Rather, ECL amount is presented as ''accumulated
impairment amount'' in the OCI.

Trade receivables

The Company applies approach permitted by Ind AS
109 Financial Instruments, which requires expected
lifetime losses to be recognised from initial recognition of
receivables.

Other financial assets

For recognition of impairment loss on other financial
assets and risk exposure, the Company determines
whether there has been a significant increase in the credit
risk since initial recognition and if credit risk has increased
significantly, impairment loss is provided.

q) Fair value measurement

The Company measures financial instruments, such as,
derivatives at fair value at each 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 presumption
that the transaction to sell the asset or transfer the liability
takes place either:

- In the principal market for the asset or liability, or

- In the absence of a principal market, in the 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 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 financial
statements on a recurring basis, the Company determines
whether transfers have occurred between levels in the
hierarchy by re-assessing categorization (based on the
lowest level input that is significant to the fair value
measurements as a whole) at the end of each reporting
period.

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

External valuers are involved for valuation of significant
assets, such as properties and unquoted financial assets,
and significant liabilities, such as contingent consideration.
Involvement of external valuers is decided upon annually
by the Management. Selection criteria include market
knowledge, reputation, independence and whether
professional standards are maintained. The Management
decides, after discussions with the Company''s external
valuers, which valuation techniques and inputs to use for
each case.

At each reporting date, the Management analyses the
movements in the values of assets and liabilities which
are required to be remeasured or re-assessed as per the
Company''s accounting policies. For this analysis, the
Management verifies the major inputs applied in the latest
valuation by agreeing the information in the valuation
computation to contracts and other relevant documents.

The Management also compares the change in the fair
value of each asset and liability with relevant external
sources to determine whether the change is reasonable.

On an interim basis, the Management present the valuation

results to the Audit Committee and the Company''s
independent auditors. This includes a discussion of the
major assumptions used in the valuations.

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.

r) Cash and cash equivalent

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 equivalent consist of cash at banks and on hand 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.

s) Segment reporting

Operating segments are reported in a manner consistent
with the internal reporting provided to the chief operating
decision maker. The Company is engaged in the
Technology Services and Solutions, which constitutes its
single reportable segment.

t) Earnings per Share (EPS)

Basic EPS are calculated by dividing the net profit or loss
for the period attributable to equity shareholders by the
weighted average number of equity shares outstanding
during the period. Partly paid equity shares are treated as
a fraction of an equity share to the extent that they are
entitled to participate in dividends relative to a fully paid
equity share during the reporting period. The weighted
average number of equity shares outstanding during the
period is adjusted for events such as bonus issue that
have changed the number of equity shares outstanding,
without a corresponding change in resources.

Diluted EPS amounts are calculated by dividing the profit
attributable to equity shareholders of the Company
(after adjusting for interest on the convertible preference
shares, if any) by the weighted average number of equity
shares outstanding during the year plus the weighted
average number of equity shares that would be issued on
conversion of all the dilutive potential equity shares into
equity shares. Dilutive potential equity shares are deemed
converted as of the beginning of the period, unless
issued at a later date. Dilutive potential equity shares are
determined independently for each period presented.

u) Business combinations

Business combinations between entities under common
control is accounted for at carrying value under the
provisions of Ind AS 103, Business Combinations.

Transaction costs that the Company incurs in connection
with a business combination such as finders'' fees, legal
fees, due diligence fees, and other professional and
consulting fees are expensed as incurred.

v) Share-based payments

The cost of equity-settled transactions is determined by
the fair value at the date when the grant is made using
an appropriate valuation model. That cost is recognised,
together with a corresponding increase in share-based
payment (SBP) reserves in equity, over the period in
which the performance and/or service conditions are
fulfilled in employee benefits expense. The dilutive effect
of outstanding options is reflected as additional share
dilution in the computation of diluted earnings per share.

w) Corporate Social Responsibility (CSR) expenditure

CSR expenditure as per provisions of Section 135 of
the Companies Act, 2013 read with the Companies
(Corporate Social Responsibility Policy) Rules, 2014, is
charged to the Statement of Profit and Loss as expense as
and when incurred.

2(ii) Changes in accounting policies and disclosures

There are no new accounting policies applied during the
current year

2(iii) New and amended standards

The Company applied for the first-time certain standards
and amendments, which are effective for annual periods
beginning on or after 1 April 2022. The Company has not
early adopted any other standard or amendment that has
been issued but is not yet effective:

(i) Ind AS 16 - Property, Plant and Equipment: Proceeds
before Intended Use

The Ministry of Corporate Affairs has notified Companies
(Indian Accounting Standard) Amendment Rules 2022
dated 23 March 2022,which is effective from 1 April 2022
to amend the Ind AS 16 to clarify that excess of net sale
proceeds of items produced over the cost of testing, if any,
shall not be recognised in the profit or loss but deducted
from the directly attributable costs considered as part of
cost of an item of property, plant, and equipment.

The amendments are effective for annual reporting
periods beginning on or after 1 April 2022. These
amendments had no impact on the standalone financial
statements of the company as there were no sales of such
items produced by property, plant and equipment made
available for use on or after the beginning of the earliest

period presented.

(ii) Ind AS 109 Financial Instruments - Fees in the ''10 per
cent'' test for derecognition of financial liabilities

The Ministry of Corporate Affairs has notified Companies
(Indian Accounting Standard) Amendment Rules 2022
dated 23 March 2022, which is effective from 1 April 2022
to amend the Ind AS 109 to clarify the fees that an entity
includes when assessing whether the terms of a new or
modified financial liability are substantially different from
the terms of the original financial liability. These fees
include only those paid or received between the borrower
and the lender, including fees paid or received by either
the borrower or lender on the other''s behalf.

The amendments are effective for annual reporting periods
beginning on or after 1 April 2022.These amendments
had no impact on the standalone financial statements of
the company as there were no modifications/exchange''s
of the Company financial instruments during the period.

(iii) Ind AS 37 - Onerous Contracts - Costs of Fulfilling a
Contract

The Ministry of Corporate Affairs has notified Companies
(Indian Accounting Standard) Amendment Rules 2022
dated 23 March 2022,which is effective from 1 April 2022
to clarify that an onerous contract is a contract under
which the unavoidable of meeting the obligations under
the contract costs (i.e., the costs that the Company cannot
avoid because it has the contract) exceed the economic
benefits expected to be received under it.

The amendments specify that when assessing whether
a contract is onerous or loss-making, an entity needs to
include costs that relate directly to a contract to provide
goods or services including both incremental costs (e.g.,
the costs of direct labour and materials) and an allocation
of costs directly related to contract activities (e.g.,
depreciation of equipment used to fulfil the contract and
costs of contract management and supervision). General
and administrative costs do not relate directly to a contract
and are excluded unless they are explicitly chargeable to
the counterparty under the contract.

The amendments are effective for annual reporting periods
beginning on or after 1 April 2022.These amendments
had no impact on the standalone financial statements of
the company as there were no contracts for which the
Company has not yet fulfilled all of its obligations.

(iv) Ind AS 103 - Reference to the Conceptual Framework

The amendments replaced the reference to the ICAI''s
"Framework for the Preparation and Presentation of
Financial Statements under Indian Accounting Standards"
with the reference to the "Conceptual Framework for

Financial Reporting under Indian Accounting Standard"
without significantly changing its requirements.

The amendments also added an exception to the
recognition principle of Ind AS 103 Business Combinations
to avoid the issue of potential ''day 2'' gains or losses arising
for liabilities and contingent liabilities that would be within
the scope of Ind AS 37 Provisions, Contingent Liabilities
and Contingent Assets or Appendix C, Levies, of Ind AS
37, if incurred separately. The exception requires entities
to apply the criteria in Ind AS 37 or Appendix C, Levies,
of Ind AS 37, respectively, instead of the Conceptual
Framework, to determine whether a present obligation
exists at the acquisition date.

The amendments also add a new paragraph to Ind AS
103 to clarify that contingent assets do not qualify for
recognition at the acquisition date.

These amendments had no impact on the standalone
financial statements of the Company as there were no
contingent assets, liabilities or contingent liabilities within
the scope of these amendments that arose during the
period.

2(iv) Standards notified but not yet effective

The Ministry of Corporate Affairs has notified Companies
(Indian Accounting Standards) Amendment Rules, 2023
dated 31 March 2023 to amend the following Ind AS
which are effective from 01 April 2023.

(i) Ind AS 8 - Definition of Accounting Estimates

The amendments clarify the distinction between changes
in accounting estimates and changes in accounting
policies and the correction of errors. It has also been
clarified how entities use measurement techniques and
inputs to develop accounting estimates.

The amendments are effective for annual reporting
periods beginning on or after 1 April 2023 and apply to
changes in accounting policies and changes in accounting
estimates that occur on or after the start of that period.

The amendments are not expected to have a material
impact on the standalone financial statements.

(ii) Ind AS 1 - Disclosure of Accounting Policies

The amendments aim to help entities provide accounting
policy disclosures that are more useful by replacing the
requirement for entities to disclose their ''significant''
accounting policies with a requirement to disclose their
''material'' accounting policies and adding guidance on
how entities apply the concept of materiality in making
decisions about accounting policy disclosures.

The amendments to Ind AS 1 are applicable for annual
periods beginning on or after 1 April 2023. Consequential
amendments have been made in Ind AS 107.

The Company is currently revisiting their accounting policy
information disclosures to ensure consistency with the
amended requirements.

(iii) Ind AS 12 - Deferred Tax related to Assets and
Liabilities arising from a Single Transaction

The amendments narrow the scope of the initial recognition
exception under Ind AS 12, so that it no longer applies to
transactions that give rise to equal taxable and deductible
temporary differences.

The amendments should be applied to transactions that
occur on or after the beginning of the earliest comparative
period presented. In addition, at the beginning of the
earliest comparative period presented, a deferred tax
asset (provided that sufficient taxable profit is available)
and a deferred tax liability should also be recognised
for all deductible and taxable temporary differences
associated with leases and decommissioning obligations.
Consequential amendments have been made in Ind AS
101. The amendments to Ind AS 12 are applicable for
annual periods beginning on or after 1 April 2023.

The Company is currently assessing the impact of the
amendments.



Mar 31, 2018

1. GENERAL INFORMATION

AXISCADES Engineering Technologies Limited (‘the Company’/ ‘AXISCADES’), a public limited company, operates in the business of Engineering Design Services. The Company’s shares are listed for trading on the National Stock Exchange of India Limited and BSE Limited in India.

The Registered Office of the Company is “Block C, Second Floor, Kirloskar Business Park, Bengaluru -560024, Karnataka, India”

Note:

a. For property, plant and equipment existing as on the date of transition to Ind AS, i.e., 1 April 2016, the Company has used fair value as at 1 April 2016 as deemed cost.

The land and building held by the Company at Noida, Uttar Pradesh was fair valued upwards as at 1 April 2016 based on an independent valuation carried out on 16 April 2018 and the resultant increase of Rs. 793.24 lakhs for land and Rs. 11.58 lakhs for building was credited to opening reserves.

Fair value of the properties was determined as follows:

Land:

Fair value of land was determined by using the market comparable method. This means that the valuations performed by the valuer are based on active market prices, significantly adjusted for difference in the nature, location or condition of the specific property. As at the date of fair valuation, the properties’ fair values are based on valuations performed by RBSA Valuation Advisors LLP, an accredited independent valuer who has relevant valuation experience for similar office properties in India.

Significant valuation input:

Price per square metre : Rs. 104,618

Building:

Fair value of building was determined by using the depreciated replacement cost method. Gross current replacement cost of each structure is assessed after considering different factors. According to the specifications and use of the building, its economical life is estimated and depreciation of construction by straight line method is calculated to arrive at the depreciated replacement cost of construction. As at the date of fair valuation, the properties’ fair values are based on valuations performed by RSBA Valuation Advisors LLP, an accredited independent valuer who has relevant valuation experience for similar office properties in India.

Other class of PPE (other than land and building) held by the Company

All other class of PPE (other than land and building) held by the Company was fair valued as at 1 April 2016 based on an independent valuation carried out on 16 April 2018. The fair value of these class of PPE approximates the carrying value as at 1 April 2016 as per previous GAAP and hence no gain / loss has been recognised.

Fair value of other class of PPE was determined by using depreciated replacement cost method. Gross current replacement cost of each item of PPE is assessed after considering different factors. According to the specifications and use of the items of PPE , its economical life is estimated and depreciation by straight line method is calculated to arrive at the depreciated replacement cost of PPE. As at the date of fair valuation, the properties’ fair values are based on valuations performed by J R S & Co, Chartered Accountants who has relevant valuation experience for similar office properties in India.

b. Contractual obligations

There are no contractual commitments for the acquisition of property, plant and equipment.

c. Capitalised borrowing cost

There is no borrowing costs capitalised during the year ended 31 March 2018 (31 March 2017: Nil; 1 April 2016: Nil).

d. Property, plant and equipment pledged as security

Details of properties pledged are as per note 16

e. Decommissioning cost

A provision has been recognised for decommissioning costs associated with the premises taken on lease. The Company is committed to decommissioning the premises as a result of improvements made to the premises (refer note 18).

a) During the financial year 2016 - 17, the Company has incorporated a wholly owned subsidiary on 16 August 2016 in Germany, namely, AXISCADES GmbH, to explore opportunities in the European region.

b) The Company entered into a Share Purchase Agreement (‘SPA’) effective December 1, 2017, to acquire 100% of the paid-up share capital of Mistral Solutions Private Limited (MSPL) in a phased manner from promoters and other shareholders of MSPL. MSPL is headquartered at Bengaluru, India and engaged in rendering end-to-end services for product design and development in the embedded space, design and development services covering hardware and software, customizable product designs, system integration and other related solutions. The fair value of the purchase consideration is determined at Rs. 24,213.97 lakhs and it will be payable over a period as per the terms of the SPA. Out of the aforesaid purchase consideration payable, Rs. 10,325.23 lakhs is disclosed under Other Non-current financial liabilities and Rs. 10,702.84 lakhs is disclosed under Other current financial liabilities.

As at 31 March 2018, trade receivables include a sum of Rs. 21.78 lakhs (31 March 2017: Rs. 21.78 lakhs; 1 April 2016: Rs. 23.71 lakhs) foreign currency receivables outstanding for more than 365 days. In this regard, the Company has filed for extension with its Authorised Dealer as per the required provisions of Foreign Exchange Management Act,1999.

No trade or other receivables are due from director or other officers of the Company either severally or jointly with any other person. Refer note 16 for details of assets pledged as security for borrowings.

(a) The Board of Directors approved Intercorporate Deposits (ICD) of ‘1,500 lakhs to AXISCADES Aerospace & Technologies Private Limited (ACAT), subsidiary of the Company, at an interest rate of the Company’s maximum borrowing rate plus 1% per annum payable on a quarterly basis and other such terms and conditions that are on arm’s length basis and in the ordinary course of business. During the year ended 31 March 2017, the Company had advanced further ‘125 lakhs to ACAT and the entire amount of ICD of ‘1,500 lakhs has been repaid by ACAT during the same year.

(b) Refer note 16 for details of assets pledged as security for borrowings.

1. Fixed deposits of a carrying amount Rs. 382.86 lakhs (31 March 2017: Rs. 409.98 lakhs; 1 April 2016: Rs. 409.98 lakhs) have been deposited as margin money at 10% against the packing credit facility loan availed from a bank.

2. Deposits of a carrying amount Rs. 31.79 lakhs (31 March 2017: Rs. 29.02 lakhs; 1 April 2016: Rs. 17.73 lakhs) have been deposited as bank guarantee towards lien on various authorities and customers.

3. Refer note 16 for assets pledged as security for borrowings.

b) Terms and rights attached to equity shares

The Company has only one class of equity shares having a par value of Rs. 5 per share. Each equity share is entitled to one vote per share. Dividend, if any, proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting and shall be payable in Indian rupees. In the event of liquidation of the Company, the shareholders will be entitled to receive remaining assets of the Company, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders.

e) I n the period of five years immediately preceding the Balance Sheet date, the Company has not issued any bonus shares or has bought back any shares.

f) Details of shares allotted for consideration other than cash (within five years preceding the Balance Sheet date)

* The Company had 271.90 lakhs equity shares of Rs. 5 each amounting to Rs. 1,361.01 lakhs that were subscribed and paid-up as at 1 April 2016. During the previous year, the Company had issued 105.70 lakhs equity shares of Rs. 5 each amounting to Rs. 528.50 lakhs pursuant to scheme of amalgamation (“scheme”) (refer note 29) entered by the Company. In accordance with Appendix C, Business Combinations of entities under common control, of Ind AS 103, Business Combinations, the financial information in the financial statements in respect of prior periods have been restated as if the business combination had occurred from the beginning of the first period presented in the financial statements, irrespective of the actual date of combination. Consequent to the above, the opening balance of share capital and related disclosures have been restated.

Note: Securities premium

Securities premium is used to record the premium on issue of shares. The reserve will be utilised in accordance with the provisions of the Companies Act, 2013.

capital reserve

Capital reserve is created pursuant to the common control business combination. The reserve will be utilised in accordance with the provisions of the Companies Act, 2013 (also refer note 29).

Other reserves

Other reserves includes re-measurement (losses) / gains on defined benefit obligation.

a) details of security for borrowings

(i) Packing credit facility in foreign currency (“PCFC”) is from a bank are secured by first exclusive charge on current assets, exclusive charge on movable assets and second exclusive equitable mortgage on land and building of the Company situated at D-30, Sector 3, Noida, UP. Additionally, 10% cash margin in the form of fixed deposits lien to be maintained if PCFC availment exceeds Rs. 100 million.

(ii) Buyer’s Credit from a bank is secured by exclusive charge on both movable and immovable assets of the Company; first charge on land and building of the Company situated at D-30 Sector 3, Noida, UP.

(iii) Foreign currency Term Loan(‘FCTL’) from a bank is secured by the first pari passu charge on entire current assets and tangible property, plant and equipment of the Company both present and future including land and building of the Company situated at D-30, Sector 3, Noida, UP. Additionally, shares are pledged to the extent of 1.40 times of the exposure of both of the companies(i.e. the Company and AXISCADES Aerospace & Technologies Private Limited) with Mark to Market Clause.

(iv) Cash credit from banks is secured by the first pari passu charge on entire current assets and tangible property, plant and equipment of the Company both present and future including land and building of the Company situated at D-30, Sector 3, Noida, UP.

b) Terms of borrowings and rate of interest

(i) Packing credit in foreign currency from bank bearing an interest rate of 2.5% - 5.5% (31 March 2017 and 1 April 2016: 3% - 5%) are repayable over a maximum tenure of 180 days from the date of respective availment).

(ii) Buyer’s credit bearing an interest rate of 1.39% p.a. has been repaid during the previous year 2016-17.

(iii) I ntercorporate deposits from Jupiter Capital Private Limited for Rs. Nil (31 March 2017: Rs. 73.00 lakhs; 1 April 2016: Rs. 55.64 lakhs) carrying rate of interest at 12% per annum (31 March 2017: 12% per annum; 1 April 2016: 14% per annum) has been repaid during the year.

(iv) During the year the Company has availed Intercorporate deposits from Cades Studec Technologies (India) Private Limited aggregating Rs. 250.00 lakhs carrying rate of interest at 9% per annum.

(v) During the year the Company has availed term loan from bank aggregating USD 46.15 lakhs carrying an effective interest rate of 8.50% per annum. The loan is repayable in 16 quarterly instalments, after a moratorium of 1 year from the date of availment.

(vi) Cash credit from bank bears an interest rate of 11.55 % p.a. (31 March 2017 and 1 April 2016: 12.75%) and are repayable on demand over a maximum tenure of 12 months from the date of respective availment.

c) Loan covenants

Term loan from banks contain certain financial covenants such as debt service coverage ratio, total debt as a percentage of total net-worth etc. The Company has satisfied all other debt covenants prescribed in the terms of bank loan except debt service coverage ratio. The Management is of the view that this is a minor breach and hence no adjustments are made to standalone Ind AS financial statements in this respect.

Asset retirement obligation

The Company has recognised a provision for asset retirement obligation associated with premises taken on lease. In determining the fair value of the provision, assumptions and estimates are made in relation to the discount rates, the expected cost to dismantle and remove furniture and fixtures from the leased premises and the expected timing of these costs. The carrying amount of the provision as at 31 March 2018 is Rs. 19.24 lakhs (31 March 2017: Rs. 22.84 lakhs; 1 April 2016 : Rs. 20.18 lakhs). The Company estimates the costs would be realised within 4 - 5 years time upon the expiration of the lease and calculates the provision using the DCF method based on the following assumptions:

2. ScHEME OF amalgamation (‘SCHEME’)

(a) The Board of Directors of the Company at its meeting held on 14 August 2015, had approved the acquisition of AXISCADES Aerospace & Technologies Private Limited (“ACAT”), an aerospace, defence and homeland security technologies company by way of a Scheme of Amalgamation of India Aviation Training Institute Private Limited (“IAT”) with the Company. ACAT is a 100% subsidiary of IAT. The appointed date of the Scheme was 1 April 2016 and was subject to the approval of the majority of the shareholders and creditors of the Company and IAT, the Hon’ble High Court and the permission and approval of any other statutory or regulatory authorities, as applicable.

(b) Consequent to the approval of the Scheme of Amalgamation u/s 391 to 394 of the Companies Act, 1956 for the amalgamation of IAT with the Company, by the Hon’ble High Court of Karnataka on 4 November 2016, and effected on 5 December 2016 (effective date), being the date of filing with the Registrar of Companies, all the assets, liabilities and reserves of IAT were transferred to and vested in the Company with effect from 1 April 2016, the appointed date.

(c) Pursuant to the Scheme, the shareholders of IAT were eligible to receive 10 equity shares of the Company of par value of Rs. 5 each fully paid up for every 45 equity shares held in IAT of par value of Rs. 10 each fully paid up (‘Swap ratio’), with record date being 20 December 2016 as fixed by the Board of Directors of the Company. The Board of Directors of the Company at its meeting held on 30 December 2016, in terms of the said Scheme of Amalgamation has issued and allotted 10,569,937 new equity shares of the Company to the shareholders of IAT.

(d) In accordance with Part B of the Scheme, all the assets and liabilities of IAT were transferred to the Company with effect from the appointed date at the respective book values in the financial statements of IAT. Since, both the Company and IAT are under the common control of Jupiter Capital Private Limited, the holding Company, this transaction has been accounted in accordance with the Pooling of Interests Method outlined in IND AS 103 “Business Combination”, and the surplus of the net assets acquired over the consideration issued has been credited to Capital Reserve determined as follows:

(e) Consequent to the above, ACAT has become wholly owned subsidiary of the Company and ceases to be a fellow subsidiary of the Company. On account of which AXISCADES Aerospace Infrastructure Private Limited (‘AAIPL’) and Enertec Controls Limited (‘Enertec’), subsidiaries of ACAT, have become step-down subsidiaries of the Company.

(f) I n accordance with Appendix C, Business combinations of entities under common control, to Ind AS 103, Business combinations, the financial information in the financial statements in respect of prior periods have been restated as if the business combination had occurred from the beginning of the first period presented in the financial statements, irrespective of the actual date of combination. Therefore, the accounting for the scheme is effective from 1 April 2016 (also refer section C6 - 6 under note 45).

(i) Equity shares issued during the reporting period as part of the consideration for the scheme of amalgamation is included in the computation of weighted average number of shares from the beginning of the reporting period i.e. 1 April 2016, which is also the appointed date. This effect is given to the computation of EPS for the year ended 31 March 2017.

(a) As the future liability for gratuity is provided on an actuarial basis for the Company as a whole, the amount pertaining to individual is not ascertainable and therefore not included above.

3. DISCLOSURES IN RESPECT OF OPERATING LEASES

The lease expenses for cancellable and non-cancellable operating leases during the year ended 31 March 2018 is Rs. 1,174.61 lakhs (31 March 2017: Rs. 933.55 lakhs).

The details of lease commitments in terms of minimum lease payments within the non-cancellable period are as follows:

The Company’s significant leasing arrangements in respect of operating leases for office premises, which includes both cancellable and non cancellable leases generally range between 11 months to 5 years and are usually renewable by mutual consent on mutually agreeable terms. The aggregate lease rentals payable are charged as rent under note 27 to the financial statements.

* The Company has committed to provide financial support, if required, to its subsidiary i.e. AXISCADES Inc.

4. CAPITAL MANAGEMENT

For the purpose of the Company’s capital management, capital includes issued capital, additional paid in capital and all other equity reserves attributable to the equity holders of the Company. The primary objective of the Company’s capital management is to maximise the shareholder value.

In order to achieve this overall objective, the Company’s capital management, amongst other things, aims to ensure that it meets financial covenants attached to the interest-bearing loans and borrowings that define capital structure requirements. Breaches in meeting the financial covenants would permit the bank to immediately call loans and borrowings. There have been no breaches in the financial covenants of any interest-bearing loans and borrowing in the current period except as mentioned in note 16(c).

The Company manages its capital structure and makes adjustments in light of changes in economic conditions and the requirements of the financial covenants. To maintain or adjust the capital structure, the Company may adjust the dividend payment to shareholders, return capital to shareholders or issue new shares. The Company monitors capital using a gearing ratio, which is net debt divided by total capital plus net debt. The Company’s policy is to keep the gearing ratio below 20%. The Company includes within net debt interest bearing loans and borrowings, less cash and cash equivalents.

The management assessed that the fair value of cash and cash equivalents, trade receivables, loans, other financial assets, trade payables and working capital loans approximate the carrying amount largely due to short-term maturity of these instruments.

The fair value of the financial assets and liabilities is included at the amount at which the instrument could be exchanged in a current transaction between willing parties, other than in a forced or liquidation sale.

(ii) Fair value hierarchy

Financial assets and financial liabilities measured at fair value in the statement of financial position are grouped into three levels of a fair value hierarchy. The three levels are defined based on the observability of significant inputs to the measurement, as follows:

Level 1: Quoted prices (unadjusted) in active markets for financial instruments.

Level 2: The fair value of financial instruments that are not traded in an active market is determined using valuation techniques which maximise the use of observable market data rely as little as possible on entity specific estimates.

Level 3: I f one or more of the significant inputs is not based on observable market data, the instrument is included in level 3.

1) The Company enters into derivative financial instruments with financial institutions with investment grade credit ratings. Foreign exchange forward contracts are valued using valuation techniques, which employs the use of market observable inputs. The valuation techniques uses the exchange rates provided by “Foreign Exchange Dealers’ Association of India” for revaluation of balance in forward contracts as on the reporting dates.

(iii) valuation technique used to determine fair value

Specific valuation techniques used to value financial instruments include:

‘ the fair value of the mutual funds is determined using daily NAV as declared for the particular scheme by the Asset Management Company. The fair value estimates are included in level 2.

- the fair value of foreign exchange forward contracts is determined using market observable inputs, including prevalent forward rates for the maturities of the respective contracts and interest rate curves as indicated by banks and third parties.

‘ the fair value of other equity instruments have been computed based on income approach using a discounted cash flow model, which discounts the estimated cash flows using the appropriate discount rates.

(iv) valuation processes

The Corporate finance team has requisite knowledge and skills. The team headed by group CFO directly reports to the audit committee to arrive at the fair value of financial instruments.

5. financial risk management

The Company’s activities expose it to a variety of financial risks: market risk, credit risk and liquidity risk. The Company’s focus is to foresee the unpredictability of financial markets and seek to minimize potential adverse effects on it’s financial performance. The primary market risk to the Company is foreign exchange exposure risk. The Company uses derivative financial instruments to mitigate foreign exchange related risk exposures. The Company’s exposure to credit risk is influenced mainly by the individual characteristic of each customer.

The Company’s risk management activity focuses on actively securing the Group’s short to medium-term cash flows by minimising the exposure to volatile financial markets. Long-term financial investments are managed to generate lasting returns.

The Company does not actively engage in the trading of financial assets for speculative purposes nor does it write options. The most significant financial risks to which the Group is exposed are described below.

(A) Credit risk

Credit risk refers to the risk of default on its obligation by the counter party resulting in a financial loss. The maximum exposure to the credit risk at the reporting date is primarily from trade receivables amounting to Rs. 6,015.83 lakhs as of 31 March 2018 [31 March 2017: Rs. 4,557.77 lakhs; 1 April 2016: Rs. 6,178.85 lakhs].

Trade receivables are typically unsecured and are derived from revenue earned from customers primarily located in India and Europe. 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. On account of adoption of Ind AS 109, Financial Instruments, the Company uses expected credit loss model to assess the impairment loss or gain. The provision for expected credit loss takes into account available external and internal credit risk factors including the credit ratings of the various customers and Company’s historical experience with customers.

Credit risk exposure

The allowance for life time expected credit loss on customer balances for the year ended 31 March 2018, 31 March 2017 and 1 April 2016 is Rs. 2.57 lakhs, Rs. 3.21 lakhs and Rs. 3.21 lakhs respectively. The reversal for lifetime expected credit loss on customer balances for the year ended 31 March 2018 is Rs. 0.64 lakhs [31 March 2017: Rs. Nil] [01 April 2016: Rs. Nil].

Credit risk on cash and cash equivalents is limited as the Company generally invest in deposits with banks with high credit ratings as signed by international and domestic credit rating agencies.

Financial assets that are neither past due nor impaired

Cash and cash equivalents, advances to subsidiary, loans and advances to employees, security deposit, other financial assets and unbilled revenue are neither past due nor impaired.

Financial assets that are past due but not impaired

There is no other class of financial assets that is past due but not impaired except for receivables of Rs. 2.57 lakhs, Rs. 3.21 lakhs and Rs. 3.21 lakhs as at 31 March 2018, 31 March 2017 and 1 April 2016, respectively. The Company’s credit period generally ranges from 60-180 days from invoicing date. The aging analysis of the receivables has been considered from the date the invoice falls due. The age wise break up of receivables, net of allowances that are past due, is given below:

(B) Liquidity risk

The Company’s principal sources of liquidity are cash and cash equivalents and the cash flow that is generated from operations. The Company believes that the working capital is sufficient to meet its current requirements. Accordingly, no liquidity risk is perceived. As of 31 March 2018, the Company has a negative working capital of Rs. 6,543.98 lakhs including cash and cash equivalents of Rs. 765.06 lakhs. As of 31 March 2017, the Company had a working capital of Rs. 5,810.12 lakhs including cash and cash equivalents of Rs. 1,913.88 lakhs. As of 1 April 2016, the Company had a working capital of Rs. 4,561.74 lakhs including cash and cash equivalents of Rs. 940.36 lakhs. The management is confident of paying its dues. Accordingly, no liquidity risk is perceived.

(C) Market risk

The Company is exposed to market risk through its use of financial instruments and specifically to currency risk, interest rate risk and certain other price risk, which result from both its operating and investing activities.

Foreign currency sensitivity

The Company operates internationally and a significant portion of the business is transacted in USD and EURO currencies and consequently the Company is exposed to foreign exchange risk through its sales and purchases from overseas suppliers in various foreign currencies. The Company holds derivative financial instruments such as foreign exchange forward contracts to mitigate the risk of changes in exchange rates on foreign currency exposures. The exchange rate between the rupee and foreign currencies has changed substantially in recent years and may fluctuate substantially in the future. Consequently, the results of the Company’s operations are adversely affected as the rupee appreciates/ depreciates against these currencies.

Sensitivity

The following table details the Company’s sensitivity to a 1% increase and decrease in the ‘ against the relevant foreign currencies net of forward contracts. 1% is the sensitivity rate used when reporting foreign currency risk internally to key management personnel and represents management’s assessment of the reasonably possible change in foreign exchange rates. The sensitivity analysis includes only outstanding foreign currency denominated monetary items and adjusts their translation at the year-end for a 1% change in foreign currency rates, with all other variables held constant. A positive number below indicates an increase in profit or equity where ‘ strengthens 1% against the relevant currency. For a 1% weakening of ‘ against the relevant currency, there would be a comparable impact on profit or equity, and the balances below would be negative.

Derivative financial instruments

The Company holds derivative financial instruments such as foreign currency forward contracts to mitigate the risk of changes in exchange rates on foreign currency exposures. The counterparty for these contracts is generally a bank or a financial institution. These derivative financial instruments are valued based on quoted prices for similar assets and liabilities in active markets or inputs that are directly or indirectly observable in the marketplace.

The following table gives details in respect of outstanding foreign exchange forward contracts

The foreign exchange forward contracts mature within twelve months. The table below analyses the derivative financial instruments into relevant maturity groupings based on the remaining period as of the Balance Sheet date:

Interest rate risk

The Company’s fixed rate borrowings are carried at amortised cost. They are therefore not subject to interest rate risk as defined in Ind AS 107, Financial Instruments- Disclosures, since neither the carrying amount nor the future cash flows will fluctuate because of a change in market interest rates.

6. defined benefit obligations

The Company has provided for the gratuity liability (defined benefit plan), as per actuarial valuation carried out by an independent actuary on the Balance Sheet date.

A Defined benefit contributions India

The Company makes contribution to statutory provident fund as per Employees Provident Fund and Miscellaneous Provision Act, 1952 for its employees. This is a defined contribution plan as per Ind AS 19, Employee benefits. Contribution made during the year ended 31 March 2018 is Rs. 363.02 lakhs [31 March 2017: Rs. 345.06 lakhs].

Overseas social security

The Company makes a contribution towards social security charges for its employees located at the respective branch offices in respective foreign geographies, that are defined contribution plans. The contributions paid or payable is recognised as an expense in the period in which the employee renders services in respective geographies. Contribution made during the year ended 31 March 2018: Rs. 904.14 lakhs [31 March 2017: Rs. 845.71 lakhs].

B Defined benefit plans

The Company has provided for gratuity, for its employees as per actuarial valuation carried out by an independent actuary on the Balance Sheet date. The valuation has been carried out using the Project Unit Credit Method as per Ind AS 19 to determine the present value of Defined Benefit Obligations and the related current service cost. This is a defined benefit plan as per Ind AS 19.

The gratuity plan is governed by the provisions of the Payment of Gratuity Act, 1972 (as amended from time to time). Employees are entitled to all the benefits enlisted under this Act.

Valuations are performed on certain basic set of pre-determined assumptions and other regulatory framework which may vary over time. Thus, the Company is exposed to various risks in providing the above benefit which are as follows:

a Interest rate risk

The plan exposes the Company to the risk of fall in interest rates. A fall in interest rates will result in an increase in the ultimate cost of providing the above benefit and will thus result in an increase in the value of the liability as shown in financial statements.

b Liquidity risk

This is the risk that the Company is not able to meet the short-term gratuity payouts.This may arise due to non availability of enough cash/cash equivalents to meet the liabilities or holding of illiquid assets not being sold in time.

c Salary escalation risk

The present value of the defined benefit plan is calculated with the assumption of salary increase rate of employees in future. Deviation in the rate of interest in future for employees from the rate of increase in salary used to determine the present value of obligation will have a bearing on the plan’s liability.

d Demographic risk

The Company has used certain mortality and attrition assumptions in valuation of the liability. The Company is exposed to the risk of actual experience turning out to be worse compared to the assumption.

e Regulatory risk

Gratuity benefits are paid in accordance with the requirements of the Payment of Gratuity Act,1972 (as amended from time to time). There is a risk of change in regulations requiring higher gratuity payouts

The assumptions were developed by management with the assistance of independent actuaries. Discount factors are determined close to each year-end by reference to market yields of Government bonds that have terms to maturity approximating to the terms of the gratuity obligation. Other assumptions are based on current actuarial benchmarks and management’s historical experience.

A quantitative sensitivity analysis for significant assumption as at 31 March 2018 is as shown below:

Significant actuarial assumptions for the determination of the defined benefit obligation are discount rate, attrition rate, expected salary increase and mortality. The sensitivity analysis below has been determined based on reasonably possible changes of the assumptions occurring at the end of the reporting period, while holding all other assumptions constant. The following table summarizes the impact of change in the defined benefit obligation resulting from the specified percentage change in the aforementioned assumptions.

The sensitivity analysis presented above may not be representative of the actual change in the defined benefit obligation as it is unlikely that the change in assumptions would occur in isolation of one another as some of the assumptions may be correlated.

There is no change in the method and assumptions used in preparing the sensivity analysis from previous years.

(v) Effect of plan on entity’s future cash flows

The scheme is managed on an unfunded basis and hence, no funding arrangements or future contributions are applicable. The weighted average duration of the plan is estimated to be 14 years. Following is a maturity profile of the defined benefit obligation as at 31 March 2018 and 31 March 2017.

7. SEGMENT INFoRMATioN

The Board of Directors of the Company has been identified as the Chief Operating Decision Maker (CODM) as defined by Ind AS 108, Operating Segments. The CODM evaluates the Company’s performance and allocates resources based on an analysis of engineering services.

The Company is primarily engaged in a single segment i.e., engineering services. As the Company’s business activity primarily falls within a single segment, there are no additional disclosures to be provided in terms of Ind AS 108 on ‘Operating Segments’.

8. CORPORATE SOCIAL RESPONSIBILITY

Pursuant to the provisions of Section 135 of the Act and the Rules made thereunder, the gross amount required to be spent by the Company during the year ended 31 March 2018 amounts to Rs. 51 lakhs (31 March 2017: Rs. 44.75 lakhs). The Company has paid Rs. 51.00 lakhs (31 March 2017: Rs. 45.00 lakhs) to three non-government organisations engaged in the field of development of skills of under-privileged children, enabling them to overcome adversity and flourish in a fast changing world.

9. TRANSFER PRICING

The Finance Act, 2001 has introduced, with effect from Assessment Year 2002-03 (effective 1 April 2001), detailed Transfer Pricing regulations for computing the taxable income and expenditure from ‘international transactions’ between ‘associated enterprises’ on an ‘arm’s length’ basis. These regulations, inter alia, also require the maintenance of prescribed documents and information including furnishing a report from an Accountant within due date of filing the Return of Income. The Company is in the process of updating the Transfer Pricing documentation for the financial year ended 31 March 2018 following a detailed transfer pricing study conducted for the financial year ended 31 March 2017. In the opinion of the Management, the same would not have an impact on these financial statements. Accordingly, these financial statements do not include the effect of the transfer pricing implications, if any.

* The Company has received service tax orders from the service tax authorities arising primarily on levy of service tax on business auxiliary service under reverse charge mechanism for period 2006 - 2010. The Company’s appeal against the said demands are pending before Customs, Excise and Service Tax Appellate Tribunal (‘CESTAT’).

The Company is contesting the demands/ litigations and the Management believes that its position will be upheld in the appellate process and therefore, will not impact these financial statements. Consequently, no provision has been created in the financial statements for the above.

10. FIRST TIME ADOPTION OF IND AS

These financial statements, for the year ended 31 March 2018, are the first financial statements the Company has prepared in accordance with Ind AS. For periods up to and including the year ended 31 March 2017, the Company prepared its financial statements in accordance with accounting standards notified under section 133 of the Companies Act 2013, read together with paragraph 7 of the Companies (Accounts) Rules, 2014 (Indian GAAP).

Accordingly, the Company has prepared financial statements which comply with Ind AS applicable for periods ending on 31 March 2018, together with the comparative period data as at and for the year ended 31 March 2017, as described in the summary of significant accounting policies. In preparing these financial statements, the Company’s opening balance sheet was prepared as at 1 April 2016, the Company’s date of transition to Ind AS. This note explains the principal adjustments made by the Company in restating its Indian GAAP financial statements, including the balance sheet as at 1 April 2016 and the financial statements as at and for the year ended 31 March 2017.

A Ind AS optional exemptions Al. Deemed cost for property, plant and equipment, investment property and intangible assets

I nd AS 101, First-time Adoption of Indian Accounting Standards, permits a first-time adopter to elect to fair value for all of its property, plant and equipment and use that as its deemed cost as at the date of transition after making necessary adjustments for de-commissioning liabilities. Ind AS 101, First-time adoption of Indian Accounting Standards, also permits a first-time adopter to elect to continue with the carrying value for all of its property, plant and equipment as recognised in the financial statements as at the date of transition to Ind AS, measured as per the previous GAAP and use that as its deemed cost as on the date of transition after making necessary adjustments for de-commissioning liabilities. This exemption can also be used for intangible assets covered by Ind AS 38 Intangible Assets. Accordingly, the Company has elected to measure all of its property, plant and equipment at their fair value as at the transition date and use that as deemed cost as on the date of transition. The Company has elected to measure its intangible assets at their previous GAAP carrying value.

A2. Deemed cost for investments in subsidiaries

Ind AS 101, First-time Adoption of Indian Accounting Standards, permits a first-time adopter to elect to continue with the carrying value for investments in subsidiaries as at the date of transition to Ind AS, measured as per the previous GAAP and use that as its deemed cost as at the date of transition. Accordingly, the Company has elected to measure its investments in subsidiaries in the standalone financial statements at their previous GAAP carrying value.

A3. Lease

Appendix C to Ind AS 17, Leases, requires an entity to assess whether a contract or arrangement contains a lease. In accordance with Ind AS 17, Leases, this assessment should be carried out at the inception of the contract or arrangement. Ind AS 101, First-time Adoption of Indian Accounting Standards, provides an option to make this assessment on the basis of facts and circumstances existing at the date of transition to Ind AS, except where the effect is expected to be not material.

The Company has elected to apply this exemption for such contracts/arrangements.

B. Ind AS mandatory exemptions B1. Estimates

I n accordance with Ind AS, as at the date of transition to Ind AS an entity’s estimates shall be consistent with the estimates made for the same date in accordance with previous GAAP (after adjustments to reflect any difference in accounting policies), unless there is objective evidence that those estimates were in error.

I nd AS estimates as at 1 April 2016 are consistent with the estimates as at the same date made in conformity with previous GAAP except for impairment of financial assets based on ECL and recognition of asset retirement obligation on the date of transition as they were not required as per previous GAAP.

B2. Classification and measurement of financial assets and liabilities

The classification and measurement of financial assets will be made considering whether the conditions as per Ind AS 109, Financial Instruments are met based on facts and circumstances existing at the date of transition.

Financial assets can be measured using effective interest method by assessing its contractual cash flow characteristics only on the basis of facts and circumstances existing at the date of transition and if it is impracticable to assess elements of modified time value of money i.e. the use of effective interest method, fair value of financial asset at the date of transition shall be the new carrying amount of that asset. The measurement exemption applies for financial liabilities as well.

Applying a requirement is impracticable when the entity cannot apply it after making every reasonable effort to do so. It is impracticable to apply the changes retrospectively if:

a) The effects of the retrospective application or retrospective restatement are not determinable; or

b) The retrospective application or restatement requires assumptions about what management’s intent would have been in that period; or

c) The retrospective application or retrospective restatement requires significant estimates of amounts and it is impossible to distinguish objectively information about those estimates that existed at that time.

B3. De-recognition of financial assets and liabilities

Ind AS 101, First-time Adoption of Indian Accounting Standards, requires a first-time adopter to apply the de-recognition provisions of Ind AS 109, Financial Instruments, prospectively for transactions occurring on or after the date of transition to Ind AS. However, Ind AS 101, First-time Adoption of Indian Accounting Standards, allows a first-time adopter to apply the de-recognition requirements in Ind AS 109, Financial Instruments, retrospectively from a date of the entity’s choosing, provided that the information needed to apply Ind AS 109, Financial Instruments, to financial assets and financial liabilities derecognised as a result of past transactions was obtained at the time of initially accounting for those transactions.

The Company has elected to apply the de-recognition provisions of Ind AS 109, Financial Instruments, prospectively from the date of transition to Ind AS.

C. Reconciliations between previous GAAP and Ind AS

Ind AS 101, First-time Adoption of Indian Accounting Standards, requires an entity to reconcile equity, total comprehensive income and cash flows for prior periods. The following tables represent the reconciliations from previous GAAP to Ind AS as at the periods specified below.

C1. Reconciliation of other equity

The Company has also prepared a reconciliation of equity as at 31 March 2017 and 1 April 2016 under the previous GAAP with the equity as reported in these financial statements under Ind AS, that reflect the impact of Ind AS on the components of Balance sheet which is presented below:

C6. Notes 1. Reversal of rent recorded on account of straightlining of lease rentals

Under previous GAAP, the Company was straightlining the lease rental payables, over the term of the lease and accordingly creating provision for lease rent. Under Ind AS 17, Leases, if the escalation in the rent as per the agreement is in-line with the average general inflation rate of the country in which the asset is located, then straight-lining of the rent over the lease term is not required. In the current circumstance these escalations approximate the general inflation applicable and hence the impact of this has been reversed.

2. Asset retirement obligation

As per Ind AS 16, Property, Plant and Equipment, the cost of an item of property, plant and equipment includes the initial estimate of the costs of dismantling and removing the item and restoring the site on which it is located. Decommissioning liability is measured at best estimate of cost required to settle the liability, discounted to its present value at the time when asset becomes ready to use, using pre tax discount rate that reflects market assessment of time value of money between date of capitalisation and time of settlement of such obligation. The adjustment made in fixed assets is depreciated over its expected useful life and interest recognised on corresponding provision using the aforementioned discount rate that accretes the provision to the amount expected to be settled in future.

3. Borrowings and other financial liabilities

Under previous GAAP, all financial liabilities were carried at cost. Under Ind AS 109 , Financial Instruments, borrowings from related parties have been measured at amortised cost. The difference between carrying value of borrowings and fair value on initial recognition has been considered as additional contribution by the related parties and shown as part of ‘Other equity’. Interest expenses on amortised cost is charged to the Statement of Profit and Loss using the effective interest method.

4. Long -term trade receivables

Under Ind AS, long term trade receivables are measured at amortised cost and the difference between the carrying value and fair value on initial recognition has been accounted in retained earnings.

5. Expected credit loss assessment for trade receivables

Under previous GAAP, the Company has created a provision for impairment of receivables only with respect to specific amount for losses incurred . Under Ind AS 109, Financial Instruments, impairment allowance has been determined based on Expected Loss model (ECL) on application of the ECL model, the Company impaired part of it’s trade receivable on 1 April 2016 which has been adjusted with retained earnings. The impact for year ended on 31 March 2017 has been recognised in the Statement of Profit and Loss.

6. Accounting for the Scheme of Amalgamation

Under the previous GAAP, the Company had accounted for the merger of IAT, an entity under the common control of Jupiter Capital Private Limited, the Holding Company on pooling of interest method. Although the appointed date of the merger was 1 April 2016, this transaction was accounted from the date of the approval by the honourable High Court of Karnataka received on 4 November 2016 under the previous GAAP.

Under Ind AS, common control transactions are accounted for using the pooling of interest method similar to previous GAAP. However, the financial information in the financial statements in respect of prior periods shall be restated as if the business combination had occurred from the beginning of the preceding period in the financial statements, irrespective of the actual date of combination. Therefore, this merger has been effected from 1 April 2016 (the appointed date of the merger).

7. Income tax

Under previous GAAP, deferred tax was accounted using the income statement approach, on the timing differences between the taxable profit and accounting profits for the period. Under Ind AS 12, Income Tax, deferred taxes are recognized following the balance sheet approach on the temporary differences between the carrying amount of asset or liability in the balance sheet and its tax base. The application of Ind AS 12, has resulted in recognition of deferred tax on new temporary differences which was not required under previous GAAP primarily relating to transactional adjustments pertaining to Ind AS. Deferred tax adjustments are recognised in co-relation to the underlying transaction either in retained earnings or a separate component of equity.

8. other comprehensive income

Under Ind AS, all items of income and expense recognised in a period should be included in profit or loss for the period, unless a standard requires or permits otherwise. Items of income and expense that are not recognised in profit or loss but are shown in the Statement of Profit and Loss as ‘other comprehensive income’ includes effective portion of gains and losses on cash flow hedging instruments on FVOCI equity instruments. The concept of other comprehensive income did not exist under previous GAAP.

9. Defined benefit obligation

Under previous GAAP, actuarial gains and losses were recognized in the Statement of profit and loss, and interest cost was recognized under employee benefit expense. Under Ind AS, the actuarial gain and loss form part of remeasurement of net defined benefit liability/ asset which is recognised in other comprehensive income in the respective periods. Interest cost on defined benefit obligations shall be presented under finance cost in the Statement of Profit and Loss.

10. Property, plant and equipment

On transition to Ind AS, the Company has elected to fair value of all of its property, plant and equipment recognised as at 1 April 2016 and use that fair value as the deemed cost of the property, plant and equipment. Consequent to the above, depreciation has been adjusted for the year ended 31 March 2017.

11. Cash flow statement

Under Ind AS 7, Statement of cash flows, bank borrowings are generally considered to be financing activities. However, where bank overdrafts which are repayable on demand form an integral part of an entity’s cash management, bank overdrafts are included as a component of cash and cash equivalents.

12. Revenue from operations

The Company has entered into forwards contracts to hedge its revenue from foreign currency fluctuations. The unrealised gain/(loss) on such hedges are recognised in the hedge reserve. Under Previous GAAP, the gain/(loss) on such hedges were reclassified to the Statement of Profit and Loss under other income/expense (foreign exchange gain/loss) on maturity of such contracts. Under Ind AS, the gains/(losses) are recognised in revenue.

13. Other equity

Adjustments to retained earnings and other comprehensive income has been made in accordance with Ind AS, for the above mentioned line items.

11 . The comparative financial information of the Company for the year ended March 31, 2017 and the transition date opening balance sheet as at April 01, 2016, prepared in accordance with Ind AS included in this financial statements have been audited by Walker Chandiok & Co LLP, Chartered Accountants, vide their report dated May 07, 2018, who had audited the financial statements for the relevant periods.

12. PREVIOUS YEAR COMPARATIVES

Previous years figures have been regrouped / reclassified wherever necessary, to conform to this year’s classification.


Mar 31, 2017

1. Details of security for borrowings

Working capital loans (inclusive of packing credit facility in foreign currency “PCFC”) from a bank are secured by first exclusive charge on current assets, exclusive charge on movable assets and second exclusive equitable mortgage on land and building of the Company situated at D-30, Sector 3, Noida, UP Additionally, 10% cash margin in the form of fixed deposits lien to be maintained if PCFC availment exceeds Rs.100 million.

Buyer''s Credit from a bank is secured by exclusive charge on both movable and immovable assets of the Company; first charge on land and building of the Company situated at D-30 Sector 3, Noida, UP

2. Terms of borrowings and rate of interest

Working capital loans consists of packing credit facility in foreign currency and bank overdraft. Packing credit in foreign currency from bank bearing an interest rate of 3% - 5% (31 March 2016: 3% - 5%) are repayable over a maximum tenure of 180 days from the date of respective availment. Bank overdraft bears an interest rate of 12.75 % p.a. (31 March 2016: 12.75 %).

Buyer’s credit bearing an interest rate of 1.39% p.a. has been repaid during the year.

3. Intercorporate deposit from Holding Company

Intercorporate deposits from Jupiter Capital Private Limited for Rs.7,300,000 (31 March 2016: Rs.Nil) carrying rate of interest at 12% per annum repayable on 30 May 2019.

4. Defined contribution plan

The Company makes a contribution of statutory provident fund as per Employees Provident Fund and Miscellaneous Provision Act, 1952 for its Indian employees. This is a defined contribution plan as per AS 15. Contribution made during the year ended 31 March 2017 is Rs.34,268,873 (31 March 2016: Rs.29,422,283).

5. overseas social security

The Company makes a contribution towards social security charges for its employees located at the respective branch offices in respective foreign geographies, that are defined contribution plans. The contributions paid or payable is recognized as an expense in the period in which the employee renders services in respective geographies. Contribution made during the year ended 31 March 2017 is Rs.84,571,167 (31 March 2016: Rs.75,632,645).

The Company has no obligation beyond the contribution made under these plans referred to in (b) and (c) above.

6. The management has identified enterprises which have provided goods and services to the Company and which qualify under the definition of micro and small enterprises, as defined under Micro, Small and Medium Enterprises Development Act, 2006 (MSMEDA). Accordingly, the disclosure in respect of the amounts payable to such enterprises, if any, as at 31 March 2017 has been made in the financial statements based on information received and available with the Company. Further, in the view of the management, the impact of interest, if any, that may be payable in accordance with the provisions of the MSMEDA is not expected to be material.

7. The Board of Directors approved Intercorporate Deposits (ICD) of Rs.150,000,000 to AXISCADES Aerospace & Technologies Private Limited (ACAT), subsidiary of the Company, at an interest rate of the Company''s maximum borrowing rate plus 1% per annum payable on a quarterly basis and other such terms and conditions that are on arm''s length basis and in the ordinary course of business. The Company had advanced Rs.12,500,000 to ACAT during the year ended 31 March 2017 and the entire amount of ICD has been repaid by ACAT during the year.

8. SCHEME OF AMALGAMATION (SCHEME)

9. The Board of Directors of the Company at its meeting held on 14 August 2015, had approved the acquisition of AXISCADES Aerospace & Technologies Private Limited (“ACAT”), an aerospace, defense and homeland security technologies company by way of a Scheme of Amalgamation of India Aviation Training Institute Private Limited (“IAT”) with ACETL. ACAT is a 100% subsidiary of IAT. The appointed date of the Scheme was 1 April 2016 and was subject to the approval of the majority of the shareholders and creditors of ACETL and IAT, the Hon’ble High Court and the permission and approval of any other statutory or regulatory authorities, as applicable.

10. Consequent to the approval of the Scheme of Amalgamation u/s 391 to 394 of the Companies Act, 1956 for the amalgamation of IAT with the Company, by the Hon’ble High Court of Karnataka on 4 November 2016, and effected on 5 December 2016 (effective date), being the date of filing with the Registrar of Companies, all the assets, liabilities and reserves of IAT were transferred to and vested in the Company with effect from 1 April 2016, the appointed date. These financial statements accordingly have been given effect of the Scheme of Amalgamation.

11. Pursuant to the Scheme, the shareholders of IAT are eligible to receive 10 equity shares of the Company of par value of Rs.5 each fully paid up for every 45 equity shares held in IAT of par value of Rs.10 each fully paid up (‘Swap ratio’), with record date being 20 December 2016 as fixed by the Board of Directors of the Company. The Board of Directors of the Company at its meeting held on 30 December 2016, in terms of the said Scheme of Amalgamation has issued and allotted 10,569,937 new equity shares of the Company to the shareholders of IAT.

12. In accordance with Part B of the Scheme, all the assets and liabilities of IAT were transferred to the Company with effect from the appointed date at the respective book values in the financial statements of IAT In accordance with the Pooling of Interests Method outlined in AS-14 “Accounting for Amalgamations” prescribed by the Companies (Accounting Standard) Rules, 2006, the surplus of the net assets acquired over the consideration issued has been credited to Capital Reserve determined as follows:

13. Consequent to the scheme, ACAT has become wholly owned subsidiary of the Company and ceases to be a fellow subsidiary of the Company. On account of which AXISCADES Aerospace Infrastructure Private Limited (‘AAIPL) and Enertec Controls Limited (‘Enertec''), subsidiaries of ACAT, have become step-down subsidiaries of the Company.

14. Consequent to the scheme, the figures for the year ended 31 March 2017 are not comparable with the corresponding figures for the year ended 31 March 2016.

15. SEGMENT REPORTING

The single financial report of the Company would contain the separate financial statements and consolidated financial statements, including segment information, therefore no separate disclosure on segment information is given in these standalone financial statements.

16. related party disclosures

17. Parties where control exists:

Nature of relationship Name of party

Holding Company Jupiter Capital Private Limited (JCPL)

Subsidiary companies AXISCADES, Inc. (formerly known as Axis, Inc.)

AXISCADES UK Limited (formerly known an as Axis EU Europe Limited, a step down subsidiary) Cades Studec Technologies (India) Private Limited

AXISCADES Technology Canada Inc. (formerly known an as Cades Technology Canada Inc.) AXIS Mechanical Engineering Design (Wuxi) Co., Ltd.

AXISCADES GmbH

AXISCADES Aerospace & Technologies Private Limited [refer note 24 (f)]

Enertec Controls Limited, a step down subsidiary [refer note 24 (f)]

AXISCADES Aerospace Infrastructure Private Limited (formerly known as Jupiter Aviation Services Pvt Ltd, a step down subsidiary) [refer note 24 (f)]

18. Name and relationship of related parties where transaction has taken place:

Subsidiary AXISCADES Aerospace & Technologies Private Limited [refer note 24 (f)]

Fellow subsidiary Indian Aero Ventures Private Limited

19. Key management personnel:

Vice Chairman and Executive Director Mr. Sudhakar Gande

Chief Executive Officer and Director Mr. Valmeekanathan S. (resigned as Chief Executive Officer w.e.f. 8 January 2017)

Chief Financial Officer Mr. Kaushik Sarkar

20. disclosure on Specified bank notes (SBNs)

During the year, the Company had specified bank notes or other denomination note as defined in the MCA notification G.S.R. 308(E) dated 31 March 2017 on the details of Specified Bank Notes (SBN) held and transacted during the period from 8 November 2016 to 30 December 2016, the denomination wise SBNs and other notes as per the notification is given below:

21. TRANSFER PRICING

The Finance Act, 2001 has introduced, with effect from Assessment Year 2002-03 (effective 1 April 2001), detailed Transfer Pricing regulations for computing the taxable income and expenditure from ‘international transactions'' between ‘associated enterprises'' on an ‘arm''s length'' basis. These regulations, inter alia, also require the maintenance of prescribed documents and information including furnishing a report from an Accountant within due date of filing the Return of Income. The Company is in the process of updating the Transfer Pricing documentation for the financial year ended 31 March 2017 following a detailed transfer pricing study conducted for the financial year ended 31 March 2016. In the opinion of the management, the same would not have an impact on these financial statements. Accordingly, these financial statements do not include the effect of the transfer pricing implications, if any.

22. PREVIOUS YEAR FIGURES

Previous year''s figures have been regrouped / reclassified wherever necessary, to conform to current year''s classification [refer note 24 (g)].


Mar 31, 2016

(b) Terms and rights attached to equity shares

The Company has only one class of equity shares having a par value of Rs, 5 per share. Each equity share is entitled to one vote per share. The dividend, if any, proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting shall be payable in Indian rupees. In the event of liquidation of the company, the shareholders will be entitled to receive remaining assets of the company, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders.

(a) Details of security for borrowings

Term loan from a bank is secured by exclusive charge on both movable and immovable assets of the Company and by first charge on land and building of the Company situated at D-30 Sector 3, Noida, UP

Working capital loans (inclusive of packing credit facility in foreign currency “PCFC”) from a bank are secured by first exclusive charge on current assets, exclusive charge on movable assets and second exclusive equitable mortgage on land and building of the Company situated at D-30, Sector 3, Noida, UP Additionally, 10% cash margin in the form of fixed deposits lien to be maintained if PCFC a ailment exceeds Rs, 100 million.

Buyer''s Credit from a bank is secured by exclusive charge on both movable and immovable assets of the Company; first charge on land and building of the Company situated at D-30 Sector 3, Noida, UP

(b) Terms of borrowings and rate of interest

Term loan bearing an interest rate of Bank''s base rate plus 2.50% subject to a minimum of 13%, is repayable from May 2015 over 30 equal monthly installments post a moratorium of 6 months. (31 March 2015: term loans having an interest rate of bank''s base rate plus 2.50% subject to a minimum of 13%, were repayable from May 2015 over 30 equal quarterly installments.)

Working capital loans consists of packing credit facility in foreign currency and bank overdraft. Packing credit in foreign currency from bank bearing an interest rate of 3% - 5% (31 March 2015: 3% - 6%) are repayable over a maximum tenure of 180 days from the date of respective a ailment. Bank overdraft bears an interest rate of 12.75 % p.a.

Buyer''s credit is repayable on 5 August 2016 bearing an interest rate of 1.39% p.a.

(b) Defined contribution plan

The Company makes contribution of statutory provident fund as per Employees Provident Fund and Miscellaneous Provision Act, 1952 for its Indian employees. This is a defined contribution plan as per AS 15. Contribution made during the year ended 31 March 2016 is Rs, 29,422,283 (31 March 2015: Rs, 24,308,361).

(c) Overseas social security

The Company makes contribution towards social security charges for its employees located at the respective branch offices in respective foreign geographies, which is a defined contribution plan. The contributions paid or payable is recognized as an expense in the period in which the employee renders services in respective geographies. Contribution made during the year ended 31 March 2016 is Rs, 75,632,645 (31 March 2015: Rs, 65,578,045).

* Includes dues to subsidiaries of Rs, 23,500,107 (31 March 2015: Rs, Nil) (Also, refer note 27)

(a) The management has identified enterprises which have provided goods and services to the Company and which qualify under the definition of micro and small enterprises, as defined under Micro, Small and Medium Enterprises Development Act, 2006 (MSMEDA). Accordingly, the disclosure in respect of the amounts payable to such enterprises as at 31 March 2016 has been made in the financial statements based on information received and available with the Company. Further, in the view of the management, the impact of interest, if any, that may be payable in accordance with the provisions of the MSMEDA is not expected to be material.

(a) The Board of Directors approved an ICD of Rs, 150,000,000 to AXISCADES Aerospace & Technologies Private Limited (ACATPL), a fellow subsidiary of the Company, at an interest rate of Company''s maximum borrowing rate plus 1% per annum payable on a quarterly basis and other such terms and conditions that are on arm''s length basis and in the ordinary course of business. The Company has advanced Rs, 137,500,000 to ACATPL during the year ended 31 March 2016. The ICD extended is in the nature of working capital assistance to ACATPL for a period of two years from the effective date of the ICD agreement. This amount may be extended beyond the two years period based on mutual agreement.

*Advances recoverable in cash or kind

As at 31 March 2016, trade receivables include a sum of Rs, 2,370,765 (31 March 2015: Rs, 9,543,335) foreign currency receivables outstanding for more than 365 days. In this regard, the Company has filed for extension with its Authorized Dealer as per the required provisions of Foreign Exchange Management Act,1999.

(a) Fixed deposits given as security:

1. Fixed deposits of a carrying amount Rs, 40,998,265 (31 March 2015: Rs, 32,036,959) have been deposited as margin money at 10% against the Packing credit facility loan availed from a bank.

2. Deposits of a carrying amount Rs, 1,772,994 (31 March 2015: Rs, 718,200) have been deposited as bank guarantee towards lien on various authorities and customers.

(a) The Board of Directors of ACETL at its meeting held on 14 August 2015, has approved the acquisition of AXISCADES Aerospace & Technologies Private Limited (“ACATL’), an aerospace, defense and homeland security technologies company by way of a Scheme of Amalgamation of India Aviation Training Institute Private Limited (“IAT”) with AXISCADES Engineering Technologies Limited (“ACETL’). ACATL is 100% subsidiary of IAT. Shareholders of IAT (holding company of ACATL) will receive 10 (ten) shares in ACETL for every 45 (forty five) shares held by them in IAT. The transaction is proposed to be completed via a Scheme of Amalgamation. The appointed date of the Scheme is 1 April 2016 or any other date as may be directed by the Hon''ble Court of Karnataka and the Scheme is subject to the approval of the requisite shareholders and creditors of ACETL and IAT, the Honourable High Court and the permission and approval of any other statutory or regulatory authorities, as applicable. The Company has filed the draft Scheme of Amalgamation with the Stock Exchanges under clause 24(f) of the Listing Agreement on 2 September 2015. No complaints with this respect have been received from any stakeholder during the specified period and the Report as on 13 October 2015 has been submitted to that effect with the Stock

Exchanges. Further, the Scheme has got the approval from the shareholders and creditors on 25 April 2016 in the Court Convened Meeting and petition to that effect has been filed with the Hon''ble High Court of Karnataka.

(b) Pursuant to the allotment of equity shares as per the Scheme (Also, refer note 3 (a)), the Company has remitted stamp duty expense on the transaction amounting to Rs, Nil during the year March 2016 (31 March 2015: Rs, 22,294,578).

3. SEGMENT REPORTING

The single financial report of the Company would contain the separate financial statements and consolidated financial statements, including segment information, therefore no separate disclosure on segment information is given in these standalone financial statements.

4. RELATED PARTY DISCLOSURES

i. Parties where control exists:

Nature of relationship Name of party

Holding Company Jupiter Capital Private Limited (JCPL)

Subsidiary companies Axis Inc.

AXISCADES UK Limited (formerly known an as Axis EU Europe Limited, a step down subsidiary) Cades Studec Technologies (India) Private Limited

AXISCADES Technology Canada Inc. (formerly known as Cades Technology Canada Inc.)

Axis Mechanical Engineering Design (Wuxi) Co., Ltd.

ii. Name and relationship of other related parties

Fellow subsidiary AXISCADES Aerospace & Technologies Private Limited

iii. Key management personnel:

Vice Chairman and Executive Director Mr. Sudhakar Gande (appointed w.e.f. 14 August 2015)

Chief Executive Officer and Director Mr. Valmeekanathan S.

Chief Financial Officer Mr. Kaushik Sarkar (resigned as Director w.e.f. 25.06.2015)

* During the year ended 31 March 2016, the Company had made an application to the Central Government under Section 196 and 197 read with Schedule V of the Companies Act, 2013 seeking approval to authorize the payment of managerial remuneration in excess of the limits as laid down in Section 197(1) of the Companies Act, 2013 to Mr. Sudhakar Gande, who has been appointed as a Whole Time Director of the Company w.e.f. 14 August 2015. On 2 May 2016, the Central Government in terms of Section 197(3) of the Companies Act, 2013 has approved the remuneration payable to the aforesaid managerial personnel from the date of the appointment and consequently, the Company has recorded managerial remuneration payable as per the terms of appointment for the financial year ended 31 March 2016.

5. DISCLOSURES IN RESPECT OF NON-CANCELLABLE OPERATING LEASES

The lease expenses for cancellable and non-cancellable operating leases during the year ended 31 March 2016 was Rs, 87,495,560 (31 March 2015: Rs, 82,072,820).

The Company''s significant leasing arrangements in respect of operating leases for office premises, which includes both cancellable and non cancellable leases and range between 11 months and 9 years generally and are usually renewable by mutual consent on mutually agreeable terms. The aggregate lease rentals payable are charged as rent under Note 22 to the financial statements.

6. CORPORATE SOCIAL RESPONSIBILITY

Pursuant to the provisions of Section 135 of the Act and the Rules made there under, the gross amount required to be spent by the Company during the year ended 31 March 2016 amounts to Rs, 2,484,000 (31 March 2015: Rs, 1,937,000). The Company has paid Rs, 2,484,000 to three non-government organizations engaged in the field of development of skills of under-privileged children, enabling them to overcome adversity and flourish in a fast changing world.

7. TRANSFER PRICING

The Company is required to use certain specified methods in computing arm''s length price of international transactions between the associated enterprises and maintain prescribed information and documents relating to such transactions. The appropriate method to be adopted will depend on the nature of transactions / class of transactions, class of associated persons, functions performed and other factors, which have been prescribed. The Company is in the process of updating the Transfer Pricing documentation for the financial year ending 31 March 2016 following a detailed transfer pricing study conducted for the financial year ended 31 March 2015. In the opinion of the management, the same would not have an impact on these financial statements. Accordingly, these financial statements do not include the effect of the transfer pricing implications, if any.

8. PREVIOUS YEAR FIGURES

Previous year''s figures have been regrouped / reclassified wherever necessary, to conform to current year''s classification.


Mar 31, 2015

1 Terms and rights attached to equity shares

The Company has only one class of equity shares having a par value of Rs. 5 per share. Each equity share is entitled to one vote per share. The dividend, if any, proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting shall be payable in Indian rupees. In the event of liquidation of the company, the shareholders will be entitled to receive remaining assets of the company, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders.

2 Details of security for borrowings

Term loan from a Bank is secured by exclusive charge on both moveable and immoveable assets of the company; first charge on land and building of the Company situated at D-30 Sector 3, Noida, UP and by a corporate guarantee from AXISCADES Aerospace & Technologies Private Limited for Rs. 50 million (31 March 2014: Rs. 150 million).

Working capital loans (inclusive of packing credit facility in foreign currency) from a bank are secured by first exclusive charge on current assets, exclusive charge on movable assets and second exclusive equitable mortgage on land and building of the Company situated at D-30, Sector 3, Noida, UP and by a corporate guarantee from AXISCADES Aerospace & Technologies Private Limited for Rs. 302.5 million (31 March 2014: Rs. 200 million). Additionaly, 20% cash margin in the form of fixed deposits lien to be maintained if PCFC availment exceeds Rs. 102.5 million.

3 Terms of borrowings and rate of interest

Term loans having an interest rate of Bank's base rate plus 2.50 % subject to a minimum of 13% are repayable from May 2015 over 30 equal monthly instalments post a moratorium of 6 months.(31 March 2014: term loans having an interest rate of bank's base rate plus 2.50% were repayable from March 2014 over 10 equal quarterly instalments.)

Packing credit in foreign currency from bank bearing an interest rate of 3% - 6% (31 March 2014: 3% - 6%) are repayable over maximum tenure of 180 days from the date of respective availment.

Intercorporate deposits carrying an interest rate of 11% (31 March 2014: 11%) per annum has been fully repaid in the current year.

4 Defined contribution plan

The Company makes contribution of statutory provident fund as per Employees Provident Fund and Miscellaneous Provision Act, 1952. This is a defined contribution plan as per AS 15. Contribution made during the year ended 31 March 2015 is Rs. 24,308,361 (31 March 2014 : Rs. 20,948,824).

5 Overseas social security

The Company makes contribution towards social security charges for its employees located at the respective branch offices in respective foreign geographies, which is a defined contribution plan. The contributions paid or payable is recognised as an expense in the period in which the employee renderssen/ices in respective geographies. Contribution made during the year ended 31 March 2015 is Rs. 65,578,045 (31March2014:C 67,309,10S).

6 Fixed deposits given as security:

i. Fixed deposits of a carrying amount Rs. 32,036,959 (31 March 2014: Rs. 38,775,758 ) have been deposited as margin money at 20% against the packing credit facility loan availed from a bank.

ii. Deposits of a carrying amount Rs. 718,200 (31 March 2014: Rs. 331,075) have been deposited as bank guarantee towards lien on customs department and various customers.

7 RELATED PARTY DISCLOSURES

i. Parties where control exists:

Nature of relationship Name of party

Holding Company Jupiter Capital Private Limited ('JCPL'). Tayana Digital Private Limited (TDPL) ceased to be the intermediate holding company w.e.f. 09 July 2014 and in turn AXISCADES Aerospace & Technologies Private Limited, (ACAT, formerly known as Axis Aerospace & Technologies Limited) also ceased to be the intermediate holding company. ACAT is a subsidiary of JCPL.

Subsidiary Companies Axis Inc. Axis EU Europe Limited (formerly know an as Axis EU Limited, a step down subsidiary) Cades Studec Technologies (India) Private Limited Cades Technology Canada Inc. Axis Mechanical Engineering Design (Wuxi) Co., Ltd.

ii. Name and relationship of related parties where transaction has taken place:

Fellow subsidiary AXISCADES Aerospace & Technologies Private Limited

Fellow subsidiary Enertec Controls Limited

iii. Key management personnel:

CEO and Chairman Mr. S. Ravinarayanan (resigned as CEO w.e.f. 24 February 2014)

CEO and Director Mr. Valmeekanathan S. (appointed w.e.f. 25 February 2014)

CFO and Director Mr. Kaushik Sarkar (appointed w.e.f. 12 September 2014)

Company Secretary Ms. Shweta Agrawal (w.e.f. 1 April 2014)

8 Corporate social responsibility

Pursuant to the provisions of Section 135 of the Act and the Rules made thereunder, the gross amount required to be spent by the Company during the year ended 31 March 2015 amounts to Rs.1,937,000. The Company has paid Rs.1,937,000 to two non-government organizations engaged in the field of development of skills of under-privileged children, enabling them to overcome adversity and flourish in a fast changing world.

9 Appointment of Chief Financial Officer

After the Balance sheet date, the Company's application seeking approval from the Central Government for the remuneration to the Executive Director and Chief Financial Officer (CFO) of the Company has been viewed negatively in light of the provisions of Section 203 of the Act.

The Management has been advised by an expert opinion that appointment of the CFO is compliant with Section 203 and they have supported their view with prevailing corporate practice as well. Further, the Management has also been advised to resubmit the application to the Policy Wing of the Ministry of Corporate Affairs for re-examination and if found in order, to view the application positively.

Based on the expert's opinion, Management is of the view that aforesaid denial of the permission does not have any financial implications and accordingly the Management has taken requisite steps as advised. Meanwhile, the Company shall maintain status quo till final disposal of the aforesaid application.

10 Transfer pricing

The Company is required to use certain specified methods in computing arm's length price of international transactions between the associated enterprises and maintain prescribed information and documents relating to such transactions. The appropriate method to be adopted will depend on the nature of transactions / class of transactions, class of associated persons, functions performed and other factors, which have been prescribed. The Company is in the process of updating the Transfer Pricing documentation for the financial year ending 31 March 2015 following a detailed transfer pricing study conducted for the financial year ended 31 March 2014. In the opinion of the management, the same would not have an impact on these financial statements. Accordingly, these financial statements do not include the effect of the transfer pricing implications, if any.

11 PREVIOUS YEAR FIGURES

Previous year's figures have been regrouped / reclassified wherever necessary, to conform to current year's classification.


Mar 31, 2014

1. SEGMENT REPORTING

The single financial report of the Company would contain consolidated financial statements, including segment information, and the separate financial statements. Therefore, no separate disclosure on segment information is given in these financial statements.

2 RELATED PARTY DISCLOSURES

i. Parties where control exists :

Nature of relationship Name of party

Holding Company

Tayana Digital Private Limited (demerged from Tayana Software Solutions Private Limited), which is a subsidiary of Axis Aerospace & Technologies Limited. (''AATL'', formerly known as Jupiter Strategic Technologies Private Limited''). AATPL, a venture funded by Jupiter Capital Private Limited (''JCPL''), is a subsidiary of the JCPL.

Entity under common control Subsidiar y companies

Enertec Controls Limited

Axis Inc., U.S.A.

Axis E.U. Limited (Step down subsidiary)

Cades Studec Technologies(India) Private Limited

Cades Technology Canada Inc.

Axis Mechanical Engineering Design (Wuxi) Co., Ltd.

Cades Digitech Private Limited (Also, refer note 2)

ii. Key management personnel :

Chairman and CEO CEO

Mr. S. Ravinarayanan (resigned as CEO on 24 February 2014) Mr. Valmeekanathan S. (appointed on 25 February 2014)

iii. Transactions with related parties:

3. TRANSFER PRICING

The Company is required to use certain specified methods in computing arm''s length price of international transactions between the associated enterprises and maintain prescribed information and documents relating to such transactions. The appropriate method to be adopted will depend on the nature of transactions / class of transactions, class of associated persons, functions performed and other factors, which have been prescribed. The Company is in the process of updating the Transfer Pricing documentation for the financial year ending 31 March 2014 following a detailed transfer pricing study conducted for the financial year ended 31 March 2013. In the opinion of the management, the same would not have an impact on these financial statements. Accordingly, these financial statements do not include the ef ect of the transfer pricing implications, if any.

4. PREVIOUS YEAR FIGURES

Pursuant to the Scheme (Refer note 2), the figures of the current year are not strictly comparable to those of the previous year. Previous year''s figures have been regrouped / reclassified wherever necessary, to conform to current year''s classification.


Mar 31, 2013

1 DISCLOSURES IN RESPECT OF NON-CANCELLABLE OPERATING LEASES

The lease expenses for cancellable and non-cancellable operating leases during the year ended 31 March 2013 was Rs. 35,478,675 (31 March 2012 : Rs. 32,108,640)

2 HEDGING AND DERIVATIVES

Pursuant to the adoption of AS 30 with effect from 1 April 2011, the loss on fair valuation on forward contracts, which qualify as effective cashflow hedges amounting to Rs. NIL (31 March 2012 - 7,163,655) has been recognised in the hedge reserve account. The impact of the adoption of AS 30 did not have any material impact on the opening reserves of the Company. There are no forward contracts outstanding as at 31 March 2013.

3 Transfer pricing

The Company is required to use certain specified methods in computing arm''s length price of international transactions between the associated enterprises and maintain prescribed information and documents relating to such transactions. The appropriate method to be adopted will depend on the nature of transactions / class of transactions, class of associated persons, functions performed and other factors, which have been prescribed. The Company is in the process of updating the Transfer Pricing documentation for the financial year ending 31 March 2013 following a detailed transfer pricing study conducted for the financial year ended 31 March 2012. In the opinion of the management, the same would not have an impact on these financial statements. Accordingly, these financial statements do not include the effect of the transfer pricing implications, if any.

4 The Board of Directors (''the Board'') of the Company at their meeting held on 23 January 2013 have approved a Scheme of Arrangement for the merger of Cades Digitech Private Limited, a subsidiary of Axis-IT&T Limited (''the Company'') with itself, subject to requisite majority of the shareholders'' and creditors of Axis-IT&T Limited and Cades Digitech Private Limited and such other statutory and regulatory approvals. The requisite steps for these activities are under process as at 31 March 2013.

5 PREVIOUS YEAR FIGURES

Previous year figures have been regrouped or reclassified wherever considered necessary to conform to current year classification.


Mar 31, 2012

1 SHARE CAPITAL

a. Terms and rights attached to equity shares

The Company has only one class of equity shares having a par value of Rs. 5 per share. Each equity share is entitled to one vote per share.

The dividend, if any, proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting shall be payable in Indian rupees. In the event of liquidation of the company, the shareholders will be entitled to receive remaining assets of the company, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders.

2 BORROWINGS

(a) Details of security for borrowings

Working capital borrowings (inclusive of packing credit facility in foreign currency) from bank are secured by first exclusive charge on current assets and equitable mortgage on land and building of the Company situated at D-30, Sector 3, Noida and by a corporate guarantee from Axis Aerospace & Technologies Limited.

Loan from a body corporate is secured by demand promissory note for the loan together with interest thereon.

(b) Terms of repayment of borrowings

Packing credit in foreign currency from bank bearing an interest rate of 3% - 5% are repayable over maximum tenure of 180 days from the date of respective availment.

Loan from a body corporate bearing an interest rate of 8% to 10% are repayable over a maximum tenure of three years from the date of availment.

3 EMPLOYEE BENEFIT OBLIGATION

b) Defined contribution plan

The Company makes contribution of statutory provident fund as per Employees Provident Fund and Miscellaneous Provision Act, 1952. This is a defined contribution plan as per AS 15. Contribution made during they earended 31 March 2012 is Rs. 80,04,781 (31 March 2011 : Rs. 49,92,640).

4 TRADE PAYABLES

a) The management has identified enterprises which have provided goods and services to the Company and which qualify under the definition of micro and small enterprises, as defined under Micro, Small and Medium Enterprises Development Act, 2006 (MSMEDA). Accordingly, the disclosure in respect of the amounts payable to such enterprises as at 31 March 2012 has been made in the financials statements based on information received and available with the Company. Further in the view of the management, the impact of interest, if any, that may be payable in accordance with the provisions of the MSMEDA is not expected to be material.

5 CONTINGENT LIABILITIES AND COMMITMENTS

Year ended Year ended 31 March 2012 31 March 2011 Rs. Rs.

Estimated amount of contracts remaining to be executed on and not provided for 518,939 - Corporate guarantee provided to YES Bank Limited for loans availed by CADES Digitech Private Limited, a subsidiary. 150,000,000 150,000,000

Order passed against the Company by a consumer forum, Lucknow, against which the Company has filed a revised petition - 225,600

Counter guarantee provided to YES Bank Limited against guarantee availed by Axis Aerospace & Technologies Limited. 825,000,000 -

975,518,939 150,225,600

6 RELATED PARTY DISCLOSURES

i. Parties where control exists :

Nature of relationship Name of party

Holding company information The Company is a subsidiary of Tayana Digital Private Limited (demerged from Tayana Software Solutions Private Limited) which is a subsidiary of Axis Aerospace & Technologies Limited. ('AATL', formerly known as Jupiter Strategic Technologies Private Limited'). AATPL, a venture funded by Jupiter Capital Private Limited ('JCPL'), is a subsidiary of the JCPL.

ii. Name and relationship of related parties where transaction has taken place:

Subsidiary Companies Axis Inc., U.S.A. Axis E.U. Limited Cades Digitech Private Limited Cades Technology Canada Inc

iii. Key Management Personnel:

Chairman and CEO Mr. S Ravinarayanan

7 Transfer pricing

The Company is required to use certain specified methods in computing arm's length price of international transactions between the associated enterprises and maintain prescribed information and documents relating to such transactions. The appropriate method to be adopted will depend on the nature of transactions/class of transactions, class of associated persons, functions performed and other factors, which have been prescribed. The Company is in the process of updating the Transfer Pricing documentation for the financial year ending 31 March 2012 following a detailed transfer pricing study conducted for the financial year ended 31 March 2011. In the opinion of the management, the same would not have an impact on these financial statements. Accordingly, these financial statements do not include the effect of the transfer pricing implications, if any.

8 The Board of Directors ('the Board') of the Company at their meeting held on 12 September 2011 have approved a Scheme of Arrangement for the merger of Cades Digitech Private Limited, a subsidiary of Axis-IT&T Limited ('the Company'), Tayana Digital Private Limited (parent of the Company) and other entities into Axis Aerospace & Technologies Limited ('AAT') subject to necessary approvals. The Board has also approved a Scheme of Arrangement for the subsequent merger of the Company into AAT subject to necessary approvals. The requisite steps for these activities are under process as at 31 March 2012.

9 PREVIOUS YEAR FIGURES

The financial statements for the year ended 31 March 2011 had been prepared as per the then applicable, pre-revised Schedule VI to the Companies Act,1956. Consequent to the notification of Revised Schedule VI under the Companies Act, 1956, the financial statements for the year ended 31 March 2012 are prepared as per Revised Schedule VI. Accordingly, the previous year figures have also been reclassified to conform to this year's classification.


Mar 31, 2011

1) Background and Operational outlook

Axis-IT&T Limited is a pure play Engineering Design Services ("EDS") Company that delivers design based solutions to global engineering majors. Axis-IT&T Limited is organized into two divisions – EDS and Software Development Services. The Company has made profit after tax of Rs. 62,267,727 during the year ended 31 March 2011 and its accumulated losses are Rs. 141,408,896. These accumulated losses represent erosion of more than fifty percent of net worth of the Company. The Company is projecting better performance in forthcoming years on the basis of increase in number of contracts with existing and new customers and cost control measures. There is no impact on the carrying/ recoverable value of the assets and liabilities and so no adjustments have been recorded for these assets and liabilities thereon in the financial statements. Accordingly, these financial statements have been prepared on a going concern basis.

2) Earnings /(Loss) Per Share

Basic earnings per share is calculated by dividing the net profit or loss for the period attributable to equity shareholders (after deducting preference dividends and attributable taxes) by the weighted average number of equity shares outstanding during the period. Partly paid equity shares will be treated as a fraction of an equity share to the extent that they were entitled to participate in dividends relative to a fully paid equity share during the reporting period.

The weighted average numbers of equity shares outstanding during the period will be adjusted for events of bonus issue, bonus element in a rights issue to existing shareholders; share split; and reverse share split (consolidation of shares).

For the purpose of calculating diluted earnings per share, the net profit or loss for the period attributable to equity shareholders and the weighted average number of shares outstanding during the period will be adjusted for the effects of all dilutive potential equity shares.

3) Operating and finance leases

Operating Leases

The Company has entered into cancellable and non-cancellable operating lease agreements for its Business Centers and Corporate Office premises. These leases expire over the period extending up to 30 November 2012 and are further renewable at the mutual consent of the Company and the lessor.

The lease expenses for cancellable and non-cancellable operating leases during the year ended 31 March 2011 was ¹ 23,967,867 (31 March 2010 - Rs. Nil)

c) Defined contribution plan

The Company makes contribution of statutory provident fund as per Employees Provident Fund and Miscellaneous Provision Act, 1952. This is a defined contribution plan as per AS 15. Contribution made during the year ended 31 March 2011 is Rs. 4,992,640 (31 March 2010 - Rs. 3,337,401)

4) Miscellaneous expenditure

Public issue expenses are amortised over a period of five years on pro-rata basis. However, if the equity offering is not probable or the offering is aborted, such costs will be expensed off in the year during which the offering is aborted or considered not probable.

5) Other notes

a) As at 31 March, 2011 debtors include a sum of Rs. 1,089,339 (31 March 2010: Rs. 1,811,027) receivable outstanding for more than 365 days. In this regard the Company is in the process of determining the appropriate course of action to ensure compliance with the requirements of Reserve Bank of India (RBI) Regulation and the Foreign Exchange Management Act, 1999.

6) Related party disclosures

Natureofrelationship Nameofparty

i. Parties where control exists : Holding company information

The Company is a subsidiary of Tayana Digital Private Limited (demergedfrom Tayana Software Solutions Private Limited) which is a subsidiary of Axis Aerospace & Technologies Private Limited. (AATPL, formerly known as Jupiter Strategic Technologies Private Limited). AATPL, a venture funded by Jupiter Capital Private Limited (JCPL), is a subsidiary of JCPL.

Subsidiary companies

Axis Inc., U.S.A.

Axis E.U. Limited

Cades Digitech Private Limited

Cades Technology Canada Inc

ii. Key Management Personnel : Chairman and CEO

Mr. S Ravi Narayanan

7) Additional disclosures under Schedule VI

The Company is engaged in the business of rendering engineering design services. The production and sale of such services is not capable of being expressed in any generic unit. Consequently, the quantitative details of sales and the particulars required under paragraph 3, 4C and 4D of Part II of Schedule VI to the Companies Act, 1956 have not been disclosed.

8) Prior year comparatives

Previous year figures have been regrouped or reclassified wherever considered necessary to conform to current year classification.

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