Accounting Policies of Brightcom Group Ltd. Company

Mar 31, 2025

2. SIGNIFICANT ACCOUNTING
POLICIES

a) Statement of compliance

These financial statements have been
prepared in accordance with Ind AS as
notified under the Companies (Indian
Accounting Standards)Rules, 2015 read
with Section 133 of the Companies Act, 2013
read with rule 3 of companies (Indian

accounting standards)Rules_/2015("the
from time to time).

b) Basis of preparation

These financial statements have been
prepared on the historical cost basis, except
for certain financial instruments which are
measured at fair values at the end of each
reporting period, as explained in the
accounting policies below. Historical cost is
generally based on the fair value of the
consideration given in exchange for goods
and services. 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.

c) Use of estimates and judgements

The preparation of these financial
statements in conformity with the
recognition and measurement principles of
Ind AS requires the management of the
Company to make estimates and
assumptions that affect the reported
balances of assets and liabilities, disclosures
relating to contingent liabilities as at the
date of the financial statements and the
reported amounts of income and expense
for the periods presented.

Estimates and underlying assumptions are
reviewed on an ongoing basis. Revisions to
accounting estimates are recognized in the
period in which the estimates are revised
and future periods are affected.

Key sources of estimation of uncertainty at
the date of the financial statements, which
may cause a material adjustment to the
carrying amounts of assets and liabilities
within the next financial year, is in respect
of impairment of investments, useful lives
of property, plant and equipment, valuation

of deferred tax assets, provisions and
contingent liabilities.

Impairment of investments

The Company reviews its carrying value of
investments carried at amortized cost
annually, or more frequently when there is
indication for impairment. If the
recoverable amount is less than its carrying
amount, the impairment loss is accounted
for.

Useful lives of property,
plant and equipment

The Company reviews the useful life of
property, plant and equipment at the end of
each reporting period. This reassessment
may result in change in depreciation
expense in future periods.

Valuation of deferred tax assets

The Company reviews the carrying amount
of deferred tax assets at the end of each
reporting period.

Contingencies

Management judgement is required for
estimating the possible inflow/outflow of
resources, if any, in respect of
contingencies/ claims/litigations against
the Company/by the Company as it is not i.
possible to predict the outcome of pending
matters with accuracy.

ii.

Defined Benefit Plans

iii.

The present value of the gratuity obligation
is determined using actuarial valuation. Aniv.
actuarial valuation involves making various
assumptions that may differ from actual
developments in the future. These include
the determination of the discount rate, rate
of increment in salaries and mortality rates.

Due to complexities involved in the
valuation and its long-term nature, a
defined benefit obligation is highly sensitive
to changes in these assumptions. All the
assumptions are reviewed at each reporting
date.

Fair Value measurement of
financial instruments

When the fair values of financial assets and
financial liabilities on reporting date cannot
be measured based on quoted prices in
active markets, their fair value is measured
using valuation techniques i.e., the DCF
model. The inputs to these models are taken
from observable markets.

Intangibles

Internal technical or user team assess the
useful lives of Intangible assets.
Management believes that assigned useful
lives are reasonable.

d) Current Vs Non-current classifications

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

An asset is treated as current when it
satisfies the below mentioned criteria:

Expected to be realised or intended to be
sold or consumed in normal operating
cycle;

ii. Held primarily for the purpose of
trading;

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

iv. Cash or cash equivalent unless restricted
from being exchanged or used to settle a
liability for at least twelve months after the
reporting period. All other assets are
classified as non-current assets.

A liability is classified as
current when it satisfies the below
mentioned criteria:

Expected to settle the liability in normal
operating cycle;

Held primarily for the purpose of trading;

Due to be settled within twelve months
after the reporting period, or

There is no unconditional right to defer the

settlement of the liability for at least twelve
months after the reporting period.

All other liabilities are classified as
noncurrent.

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

The operating cycle is the time between the
acquisition of assets for processing and their
realisation in cash and cash equivalents.

e) Dividends

Annual dividend distribution to the
shareholders is recognized as a liability in
the period in which the dividend is
approved by the shareholders. Any interim
dividend paid is recognized on approval by
Board of Directors. Dividend payable and
corresponding tax on dividend distribution
is recognized directly in equity.

f) Revenue recognition

1) Digital Marketing Services:

i) The Contracts between the Company and
its Customers are either time or material
contracts or fixed price contracts.

ii) Revenue from fixed price contracts is
recognized according to the milestones
achieved as specified in the contracts on the
proportionate-completion method based on

the work completed. Any anticipated losses
expected upon the contract completion are
recognized immediately. Changes in job
performance, conditions and estimated
profitability may result in revisions and
corresponding revenues and costs are
recognized in the period in which such
changes are identified. Deferred revenue
represents amounts billed in excess of
revenue earned for which related services
are expected to be performed in the next
operating cycle.

iii) In respect of time and material contract,
revenue is recognized in the period in
which the services are provided and related
costs are incurred.

iv) Revenue from product sale and licensing
arrangements are recognized on delivery
and installation.

v) Revenue is reported net of discounts,
indirect and service taxes.

2) Software Development

i) Income from software development is
accounted for on the basis of Software
developed and billed to clients on
acceptance and/or on the basis of man
days/man hours as per the terms of
contract.

ii) Revenue from professional services
consist primarily of revenue earned from
services performed on a ''time and material''
basis.

The related revenue is recognized as and
when the services are performed and
related costs are incurred.

iii) Revenue from software development
services includes revenue from time and
material and fixed price contracts are
recognized as related services are
performed

Revenue from fixed price contracts is
recognized according to the milestones
achieved as specified in the contracts on the
proportionate-completion method based on
the work completed. Any anticipated losses
expected upon the contract completion are
recognized immediately. Changes in job
performance, conditions and estimated
profitability may result in revisions and
corresponding revenues and costs are
recognized in the period in which such
changes are identified. Deferred revenue
represents amounts billed in excess of
revenue earned for which related services
are expected to be performed in the next
operating cycle.

iv) Revenue is not recognized on the grounds
of prudence, until realized in respect of

liquidated damages, delayed payments
as recovery of the amounts are not certain.

v) Revenue is reported net of discounts,
indirect and service taxes.

g) Dividend income is recorded when the right
to receive payment is established.

Interest income is recorded using the
effective interest method.

h) Leases

The Company''s lease asset classes primarily
consist of leases for land and buildings. The
Company assesses whether a contract
contains a lease, at inception of a contract. A
contract is, or contains, a lease if the
contract conveys the right to control the use
of an identified asset for a period of time in
exchange for consideration. To assess
whether a contract conveys the right to
control the use of an identified asset, the
Company assesses whether: (i) the contract
involves the use of an identified asset(ii) the
Company has substantially all of the
economic benefits from use of the asset
through the period of the lease and (iii)the

Company has the right to direct the use of
the asset. At the date of commencement of
the lease, the Company recognizes a right-
of-use (ROU) asset and a corresponding
lease liability for all lease arrangements in
which it is a lessee, except for leases with a
term of 12 months or less(short-term leases)
and low value leases. For these short-term
and low-value leases, the Company
recognizes the lease payments as an
operating expense on a straight-line basis
over the term of the lease.

Certain lease arrangements includes the
options to extend or terminate the lease
before the end of the lease term. ROU assets
and lease liabilities includes these options
when it is reasonably certain that they will
be exercised. The ROU assets are initially
recognized at cost, which comprises the
initial amount of the lease liability adjusted
for any lease payments made at or prior to
the commencement date of the lease plus
any initial direct costs less any lease
incentives. They are subsequently measured
at cost less accumulated depreciation and
impairment losses. ROU assets are
depreciated from the commencement date
on a straight-line basis over the shorter of
the lease term and useful life of the
underlying asset.

The lease liability is initially measured at
amortized cost at the present value of the
future lease payments. The lease payments
are discounted using the interest rate
implicit in the lease or, if not readily
determinable, using the incremental
borrowing rates in the country of domicile
of these leases. Lease liabilities are re¬
measured with a corresponding adjustment
to the related ROU asset if the Company
changes its assessment of whether it will
exercise an extension or a termination
option

i) Cost recognition

Costs and expenses are recognized as and
when incurred and have been classified
according to their nature.

The costs of the Company are broadly
categorized in employee benefit expenses,
depreciation and amortization and other
operating expenses. Employee benefit
expenses include employee compensation,
allowances paid, contribution to various
funds and staff welfare expenses. Other
operating expenses mainly include fees to
external consultants, cost of running its
facilities, travel expenses, cost of equipment
and software licenses, communication costs,
allowances for delinquent receivables and
advances and other expenses. Other
expenses are an aggregation of costs which
are individually not material such as
commission and brokerage, recruitment and
training, entertainment etc.

j) Foreign currency transactions

i. Functional and Presentation Currency:

The Company''s functional and presentation
currency is Indian National Rupee.

ii. Initial Recognition:

Foreign currency transactions are recorded
in the presentation currency, by applying to
the foreign currency amounts the exchange
rate between the Presentation currency and
the foreign currency at the date of the
transaction.

iii. Conversion on reporting date:

Foreign currency monetary items are
reported using the closing rate. Non¬
monetary items that are measured in terms
of historical cost in a foreign currency are
translated using the exchange rates at the
dates of the initial transactions.

iv. Exchange Differences:

Exchange difference arising on the
settlement of monetary items or on
Presenting monetary items of Company at
rates different from those at which they
were initially recorded during the year or
presented in previous financial statements
are recognized as income or as expenses in
the year in which they arise.

k) Income taxes

Income tax expense comprises current tax
expense and the net change in the deferred
tax asset or liability during the year.
Current and deferred tax are recognized in
statement of profit and loss, except when
they relate to items that are recognized in
other comprehensive income or directly in
equity, in which case, the current and
deferred tax are also recognized in other
comprehensive income or directly in equity,
respectively.

Current income taxes

The current income tax expense includes
income taxes payable by the Company, its
branches in India and overseas. The current
tax payable by the Company in India is
Indian income tax payable on worldwide
income.

The Current income tax payable by overseas
branches of the Company is computed in
accordance with the tax laws applicable in
the jurisdiction in which the respective
branch operates. The taxes paid are
generally available for set off against the
Indian income tax liability of the
Company''s worldwide income.

Advance taxes and provisions for current
income taxes are presented in the Balance
sheet after off-setting advance tax paid and
income tax provision arising in the same tax
jurisdiction and where the relevant tax

paying units intends to settle the asset and
liability on a net basis.

Deferred income taxes

Deferred income tax is recognized using the
Balance sheet approach. Deferred income
tax assets and liabilities are recognized for
deductible and taxable temporary

differences arising between the tax base of
assets and liabilities and their carrying
amount, except when the deferred income
tax arises from the initial recognition of
goodwill or an asset or liability in a
transaction that is not a business

combination and affects neither accounting
nor taxable profit or loss at the time of the
transaction.

Deferred income tax asset are recognized to
the extent that it is probable that taxable
profit will be available against which the
deductible temporary differences and the
carry forward of unused tax credits and
unused tax losses can be utilised.

The carrying amount of deferred income tax
assets is reviewed at each reporting date
and reduced to the extent that it is no longer
probable that sufficient taxable profit will
be available to allow all or part of the
deferred income tax asset to be utilised.

Deferred tax assets and liabilities are
measured using substantively enacted tax
rates expected to apply to taxable income in
the years in which the temporary
differences are expected to be received or
settled.

Deferred tax assets and liabilities are offset
when they relate to income taxes levied by
the same taxation authority and the relevant
entity intends to settle its current tax assets
and liabilities on a net basis.

Deferred tax assets include Minimum
Alternative Tax (MAT) paid in accordance
with the tax laws in India, which is likely to

give future economic benefits in the form of
availability of set off against future income
tax liability. Accordingly, MAT is
recognized as deferred tax asset in the
Balance sheet when the asset can be
measured reliably and it is probable that the
future economic benefit associated with the
asset will be realised.

l) 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.

1. Financial Assets.

i) Initial recognition and measurement:

All financial assets are recognized initially
at fair value plus, in the case of financial
assets not recorded at fair value through
profit or loss, transaction costs that are
attributable to the acquisition of the
financial asset. Transaction costs of financial
assets carried at fair value through profit or
loss are expensed in statement of profit or
loss. Purchases or sales of financial assets
that require delivery of assets within a time
frame established by regulation or
convention in the market place (regular way
trades) are recognized on the trade date, i.e.,
the date that the Company commits to
purchase or sell the asset.

ii) Subsequent measurement:
Financial assets at amortised
cost

Financial assets are subsequently measured
at amortised cost if these financial assets are
held within a business whose objective is to
hold these assets to collect contractual cash
flows and the contractual terms of the
financial assets give rise on specified dates
to cash flows that are solely payments of

principal and interest on the principal
amount outstanding.

Financial assets

at fair value through other

comprehensive income

Financial assets are measured at fair value
through other comprehensive income if
these financial assets are held within a
business whose objective is achieved by
both collecting contractual cash flows on
specified dates that are solely payments of
principal and interest on the principal
amount outstanding and selling financial
assets.

Financial assets

at fair value through profit or loss

Financial assets are measured at fair
value through profit or loss unless it is
measured at amortised cost or at fair
value through other comprehensive
income on initial recognition. The
transaction costs directly attributable to the
acquisition of financial assets and liabilities
at fair value through profit or loss are
immediately recognised in profit or loss.

iii. Derecognition:

A financial asset or where applicable, a part
of a financial asset is primarily
derecognised 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-
arrangement; and either (a) the Company
has transferred substantially all the risks
and rewards of the asset, or (b) 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.

iv. Impairment of financial assets:

In accordance with Ind AS 109, the
Company applies expected credit loss (ECL)
model for measurement and recognition of
impairment loss on the debt instruments,
that are measured at amortised cost e.g.,
loans, debt securities, deposits and trade
receivables.

Expected credit loss 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.

The management uses a provision matrix to
determine the impairment loss on the
portfolio of trade and other receivables.
Provision matrix is based on its historically
observed expected credit loss rates over the
expected life of the trade receivables and is
adjusted for forward looking estimates.

Expected credit loss allowance or reversal
recognised during the period is recognised
as income or expense, as the case may be, in
the statement of profit and loss. In case of
balance sheet, it is shown as reduction from
the specific financial asset.

2.Financial liabilities

Financial liabilities are measured at
amortised cost using the effective interest
method.

Equity instruments

An equity instrument is a contract that
evidences residual interest in the assets of
the company after deducting all of its
liabilities. Equity instruments recognised by
the Company are recognised at the
proceeds received net off direct issue cost.

i) Initial recognition and measurement:

At initial recognition, all financial liabilities
are recognised at fair value and in the case
of loans, borrowings and payables, net of
directly attributable transaction costs.

ii) Subsequent measurement:

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

b. Financial liabilities at amortised cost:

Amortised cost, in case of financial
liabilities with maturity more than one year,
is calculated by discounting the future cash
flows with effective interest rate.

The effective interest rate amortisation is
included as finance costs in the Statement of
Profit and Loss.

Financial liability with maturity of less than
one year is shown at transaction value.

iii. Derecognition:

A financial liability is derecognised when
the obligation under the liability is
discharged or cancelled or expires. The
difference between the carrying amount of a
financial liability that has been extinguished
or transferred to another party and the
consideration paid, including any non-cash
assets transferred or liabilities assumed, is
recognised in profit or loss as other income
or finance costs.

m) Cash and cash equivalents

The Company considers all highly liquid
financial instruments, which are readily
convertible into known amounts of cash
that are subject to an insignificant risk of
change in value and having original
maturities of three months or less from the
date of purchase, to be cash equivalents.
Cash and cash equivalents consist of
balances with banks which are unrestricted
for withdrawal and usage.

n) Financial Guarantee Contracts:

A financial guarantee contract is a contract
that requires the issuer to make specified
payments to reimburse the holder for a loss
it incurs because a specified debtor fails to
make payment when due in accordance
with original or modified terms of a debt
instrument.

The Company measures any financial
guarantee on initial recognition at their fair
value.

Subsequently these contracts are measured
at the higher of:

a. the amount of the loss allowance
determined as per impairment
requirements of Ind AS 109, and

b. the amount initially recognised, less
where appropriate, cumulative amount of
income recognized in accordance with the
principles of Ind AS 18.

o) Fair V alue Measurement:

The Company measures financial
instruments 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 such
asset or liability, or in the absence of a
principal market, in the most advantageous
market which is accessible to 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, maximizing the use
of relevant observable inputs and
minimizing the use of unobservable inputs.
All assets and liabilities for which fair value
is measured or disclosed in the financial
statements are categorized 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:

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

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

c. Level 3 - Valuation techniques for which
the lowest level input that is significant to
the fair value measurement is unobservable.

p) Investment in subsidiaries

Investment in subsidiaries are measured at
cost less impairment.

q) Property, plant and equipment

Property, plant and equipment are stated at
cost net of input tax credits, less
accumulated depreciation and accumulated
impairment losses, if any. Cost comprises
the purchase price and all attributable cost,
to bring the asset to its working condition
for its intended use. Borrowing costs
relating to acquisition of property, plant
and equipment which take substantial
period of time to get ready for its intended
use are also included to the extent they
relate to the period till such assets are ready
to put to use.

The Company adopted cost model as its
accounting policy, in recognition of the
property, plant and equipment and
recognises transaction value as the cost.

An item of Property, Plant and Equipment
is derecognised upon disposal or when no
future economic benefits are expected from
its use. Any gain or loss arising on
derecognition of the asset (calculated as the
difference between the net disposal
proceeds and the carrying amount of the
asset) is recognised in the Statement of
Profit and Loss. Property, Plant and
Equipment which are found to be not

usable or retired from active use or when no ]
further benefits are expected from their use
are removed from property, plant and
equipment and the carrying amount net of
scrap value, if any is charged to Statement
of Profit and Loss.

The improvements/modifications carried
on the lease hold land/property are
recognised as lease hold improvements and
are written off over the primary lease
period or the life of such improvement
whichever is lower.

r) Intangible assets

Intangible assets purchased are measured at
cost as of the date of acquisition, as
applicable, less accumulated amortisation
and accumulated impairment, if any.

Intangible assets consist of rights under
licensing agreement and software licences
which are amortised over license period
which equates the useful life ranging
between 5-6 years on a straight line basis.

s) Impairment of Non-financial assets

The carrying amounts of assets are
reviewed at each balance sheet date if there
is any indication of impairment based on
internal/ external factors. An impairment
loss is recognized wherever the carrying
amount of an asset exceeds its recoverable
amount. The recoverable amount is the
greater of the asset''s net selling price and
value in use. In assessing value in use, the
estimated future cash flows are discounted
to their present value at the weighted
average cost of capital. After impairment,
depreciation is provided on the revised
carrying amount of the asset over its
remaining useful life.

Reversal of impairment losses recognised in
prior years is recorded when there is an
indication that the impairment losses
recognised for the asset are no longer
existing or have decreased.

) Employee benefits

Defined benefit plans

For defined benefit plans, the cost of
providing benefits is determined using the
Projected Unit Credit Method, with
actuarial valuations being carried out at
each Balance sheet date. Actuarial gains and
losses are recognised in full in the other
comprehensive income for the period in
which they occur. Past service cost both
vested and unvested is recognised as an
expense at the earlier of (a) when the plan
amendment or curtailment occurs; and (b)
when the entity recognises related
restructuring costs or termination benefits.
The retirement benefit obligations
recognised in the Balance sheet
represents the present value of the
defined benefit obligations reduced by the
fair value of scheme assets. Any asset
resulting from this calculation is limited to
the present value of available refunds and
deductions in future contributions to the
scheme.

ii. Defined contribution plans

Employer''s contribution to provident fund/

employee state insurance which is in the
nature of defined contribution scheme is
expensed off when the contributions to the
respective funds are due. There are no other
obligations other than the contribution
payable to the fund.

iii. Compensated absences

Compensated absences which are not
expected to occur within twelve months
after the end of the period in which the
employee renders the related services are
recognised as an actuarially determined
liability at the present value of the defined
benefit obligation at the Balance sheet date.

u) Earnings per share

Basic earnings per share are computed
by dividing profit or loss attributable to
equity shareholders of the Company by
the weighted average number of equity
shares outstanding during the year. The
Company did not have any potentially
dilutive securities in any of the
years'' presented.

v) Borrowing Costs:

Borrowing costs directly attributable to the
acquisition, construction or production of
an asset that necessarily takes a substantial
period of time to get ready for its intended
use or sale are capitalised as part of the cost
of the asset. All other borrowing costs are
expensed in the period in which they occur.
Borrowing costs consist of interest and
other costs that an entity incurs in
connection with the borrowing of funds.
Borrowing cost also includes exchange
differences to the extent regarded as an
adjustment to the borrowing costs.

w) Segment Reporting:

Operating segments are reported in a
manner consistent with the internal

reporting provided to the Chief operating
decision maker ("CODM").

The board of directors of the company has
identified the Chairman and Managing
Director as the CODM.

---

Mar 31, 2024

2. SIGNIFICANT ACCOUNTING POLICIES

a) Statement of compliance

These financial statements have been prepared in accordance with Ind AS as notified under
the Companies (Indian Accounting Standards)Rules, 2015 read with Section 133 of the
Companies Act, 2013 read with rule 3 of companies (Indian accounting
standards)Rules,2015("fre rules")(as amended from time to time).

b) Basis of preparation

These financial statements have been prepared on the historical cost basis, except for certain
financial instruments which are measured at fair values at the end of each reporting period,
as explained in the accounting policies below. Historical cost is generally based on the fair
value of the consideration given in exchange for goods and services. 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.

c) Use of estimates and judgements

The preparation of these financial statements in conformity with the recognition and
measurement principles of Ind AS requires the management of the Company to make
estimates and assumptions that affect the reported balances of assets and liabilities,
disclosures relating to contingent liabilities as at the date of the financial statements and the
reported amounts of income and expense for the periods presented.

Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to
accounting estimates are recognized in the period in which the estimates are revised and
future periods are affected.

Key sources of estimation of uncertainty at the date of the financial statements, which may
cause a material adjustment to the carrying amounts of assets and liabilities within the next
financial year, is in respect of impairment of investments, useful lives of property, plant and
equipment, valuation of deferred tax assets, provisions and contingent liabilities.

Impairment of investments

The Company reviews its carrying value of investments carried at amortized cost annually,
or more frequently when there is indication for impairment. If the recoverable amount is
less than its carrying amount, the impairment loss is accounted for.

Useful lives of property, plant and equipment

The Company reviews the useful life of property, plant and equipment at the end of each
reporting period. This reassessment may result in change in depreciation expense in future
periods.

Valuation of deferred tax assets

The Company reviews the carrying amount of deferred tax assets at the end of each
reporting period.

Contingencies

Management judgement is required for estimating the possible inflow/ outflow of resources,
if any, in respect of contingencies/ claims/litigations against the Company/by the
Company as it is not possible to predict the outcome of pending matters with accuracy.

Defined Benefit Plans

The present value of the gratuity obligation is determined using actuarial valuation. An
actuarial valuation involves making various assumptions that may differ from actual
developments in the future. These include the determination of the discount rate, rate of
increment in salaries and mortality rates. Due to complexities involved in the valuation and
its long-term nature, a defined benefit obligation is highly sensitive to changes in these
assumptions. All the assumptions are reviewed at each reporting date.

Fair Value measurement of financial instruments

When the fair values of financial assets and financial liabilities on reporting date cannot be
measured based on quoted prices in active markets, their fair value is measured using

valuation techniques i.e., the DCF model. The inputs to these models are taken from
observable markets.

Intangibles

Internal technical or user team assess the useful lives of Intangible assets. Management
believes that assigned useful lives are reasonable.

d) Current Vs Non-current classifications

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

An asset is treated as current when it satisfies the below mentioned criteria:

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

ii. Held primarily for the purpose of trading;

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

iv. Cash or cash equivalent unless restricted from being exchanged or used to settle a
liability for at least twelve months after the reporting period. All other assets are
classified as non-current assets.

A liability is classified as current when it satisfies the below mentioned criteria:

i. Expected to settle the liability in normal operating cycle;

ii. Held primarily for the purpose of trading;

iii. Due to be settled within twelve months after the reporting period, or

iv. There is no unconditional right to defer the settlement of the liability for at least
twelve months after the reporting period.

All other liabilities are classified as noncurrent. Deferred tax assets and liabilities are
classified as non-current assets and liabilities.

The operating cycle is the time between the acquisition of assets for processing and their
realisation in cash and cash equivalents.

e) Dividends

Annual dividend distribution to the shareholders is recognized as a liability in the
period in which the dividend is approved by the shareholders. Any interim dividend
paid is recognized on approval by Board of Directors. Dividend payable and
corresponding tax on dividend distribution is recognized directly in equity.

f) Revenue recognition

1) Digital Marketing Services:

i) The Contracts between the Company and its Customers are either time or material
contracts or fixed price contracts.

ii) Revenue from fixed price contracts is recognized according to the milestones achieved as
specified in the contracts on the proportionate-completion method based on the work
completed. Any anticipated losses expected upon the contract completion are
recognized immediately. Changes in job performance, conditions and estimated
profitability may result in revisions and corresponding revenues and costs are
recognized in the period in which such changes are identified. Deferred revenue
represents amounts billed in excess of revenue earned for which related services are
expected to be performed in the next operating cycle.

iii) In respect of time and material contract, revenue is recognized in the period in which the
services are provided and related costs are incurred.

iv) Revenue from product sale and licensing arrangements are recognized on delivery and
installation.

v) Revenue is reported net of discounts, indirect and service taxes.

2) Software Development:

i) Income from software development is accounted for on the basis of Software developed
and billed to clients on acceptance and/ or on the basis of man days/man hours as per the
terms of contract.

ii) Revenue from professional services consist primarily of revenue earned from services
performed on a ''time and material'' basis. The related revenue is recognized as and when
the services are performed and related costs are incurred.

iii) Revenue from software development services includes revenue from time and material
and fixed price contracts are recognized as related services are performed.

iv) Revenue from fixed price contracts is recognized according to the milestones
achieved as specified in the contracts on the proportionate-completion method based
on the work completed. Any anticipated losses expected upon the contract
completion are recognized immediately. Changes in job performance, conditions and
estimated profitability may result in revisions and corresponding revenues and costs
are recognized in the period in which such changes are identified. Deferred revenue
represents amounts billed in excess of revenue earned for which related services are
expected to be performed in the next operating cycle.

v) Revenue is not recognized on the grounds of prudence, until realized in respect of
liquidated damages, delayed payments as recovery of the amounts are not certain.

vi) Revenue is reported net of discounts, indirect and service taxes.

g) Dividend income is recorded when the right to receive payment is established.

Interest income is recorded using the effective interest method.

h) Leases

The Company''s lease asset classes primarily consist of leases for land and buildings. The

Company assesses whether a contract contains a lease, at inception of a contract. A
contract is, or contains, a lease if the contract conveys the right to control the use of an
identified asset for a period of time in exchange for consideration. To assess whether a
contract conveys the right to control the use of an identified asset, the Company assesses
whether: (i) the contract involves the use of an identified asset(ii) the Company has
substantially all of the economic benefits from use of the asset through the period of the
lease and (iii)the Company has the right to direct the use of the asset. At the date of
commencement of the lease, the Company recognizes a right-of-use (ROU) asset and a
corresponding lease liability for all lease arrangements in which it is a lessee, except for
leases with a term of 12 months or less(short-term leases) and low value leases. For these
short-term and low-value leases, the Company recognizes the lease payments as an
operating expense on a straight-line basis over the term of the lease.

Certain lease arrangements includes the options to extend or terminate the lease before
the end of the lease term. ROU assets and lease liabilities includes these options when it
is reasonably certain that they will be exercised. The ROU assets are initially recognized
at cost, which comprises the initial amount of the lease liability adjusted for any lease
payments made at or prior to the commencement date of the lease plus any initial direct
costs less any lease incentives. They are subsequently measured at cost less accumulated
depreciation and impairment losses. ROU assets are depreciated from the
commencement date on a straight-line basis over the shorter of the lease term and useful
life of the underlying asset.

The lease liability is initially measured at amortized cost at the present value of the
future lease payments. The lease payments are discounted using the interest rate implicit
in the lease or, if not readily determinable, using the incremental borrowing rates in the
country of domicile of these leases. Lease liabilities are re-measured with a
corresponding adjustment to the related ROU asset if the Company changes its
assessment of whether it will exercise an extension or a termination option

i) Cost recognition

Costs and expenses are recognized as and when incurred and have been classified according
to their nature.

The costs of the Company are broadly categorized in employee benefit expenses,
depreciation and amortization and other operating expenses. Employee benefit expenses
include employee compensation, allowances paid, contribution to various funds and staff
welfare expenses. Other operating expenses mainly include fees to external consultants, cost
of running its facilities, travel expenses, cost of equipment and software licenses,
communication costs, allowances for delinquent receivables and advances and other
expenses. Other expenses are an aggregation of costs which are individually not material
such as commission and brokerage, recruitment and training, entertainment etc.

j) Foreign currency transactions

i. Functional and Presentation Currency:

The Company''s functional and presentation currency is Indian National Rupee.

ii. Initial Recognition:

Foreign currency transactions are recorded in the presentation currency, by applying to the
foreign currency amounts the exchange rate between the Presentation currency and the
foreign currency at the date of the transaction.

iii. Conversion on reporting date:

Foreign currency monetary items are reported using the closing rate. Non-monetary items
that are measured in terms of historical cost in a foreign currency are translated using the
exchange rates at the dates of the initial transactions.

iv. Exchange Differences:

Exchange difference arising on the settlement of monetary items or on Presenting monetary
items of Company at rates different from those at which they were initially recorded during
the year or presented in previous financial statements are recognized as income or as
expenses in the year in which they arise.

k) Income taxes

Income tax expense comprises current tax expense and the net change in the deferred tax
asset or liability during the year. Current and deferred tax are recognized in statement of
profit and loss, except when they relate to items that are recognized in other comprehensive
income or directly in equity, in which case, the current and deferred tax are also recognized
in other comprehensive income or directly in equity, respectively.

Current income taxes

The current income tax expense includes income taxes payable by the Company, its
branches in India and overseas. The current tax payable by the Company in India is Indian
income tax payable on worldwide income.

The Current income tax payable by overseas branches of the Company is computed in
accordance with the tax laws applicable in the jurisdiction in which the respective branch
operates. The taxes paid are generally available for set off against the Indian income tax
liability of the Company''s worldwide income.

Advance taxes and provisions for current income taxes are presented in the Balance sheet
after off-setting advance tax paid and income tax provision arising in the same tax
jurisdiction and where the relevant tax paying units intends to settle the asset and liability
on a net basis.

Deferred income taxes

Deferred income tax is recognized using the Balance sheet approach. Deferred income tax
assets and liabilities are recognized for deductible and taxable temporary differences arising
between the tax base of assets and liabilities and their carrying amount, except when the
deferred income tax arises from the initial recognition of goodwill or an asset or liability in a
transaction that is not a business combination and affects neither accounting nor taxable
profit or loss at the time of the transaction.

Deferred income tax asset are recognized to the extent that it is probable that taxable profit
will be available against which the deductible temporary differences and the carry forward
of unused tax credits and unused tax losses can be utilised.

The carrying amount of deferred income tax assets is reviewed at each reporting date and
reduced to the extent that it is no longer probable that sufficient taxable profit will be
available to allow all or part of the deferred income tax asset to be utilised.

Deferred tax assets and liabilities are measured using substantively enacted tax rates
expected to apply to taxable income in the years in which the temporary differences are
expected to be received or settled.

Deferred tax assets and liabilities are offset when they relate to income taxes levied by the
same taxation authority and the relevant entity intends to settle its current tax assets and
liabilities on a net basis.

Deferred tax assets include Minimum Alternative Tax (MAT) paid in accordance with the
tax laws in India, which is likely to give future economic benefits in the form of availability
of set off against future income tax liability. Accordingly, MAT is recognized as deferred tax
asset in the Balance sheet when the asset can be measured reliably and it is probable that the
future economic benefit associated with the asset will be realised.

l) 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.

1. Financial Assets.

i) Initial recognition and measurement:

All financial assets are recognized initially at fair value plus, in the case of financial
assets not recorded at fair value through profit or loss, transaction costs that are
attributable to the acquisition of the financial asset. Transaction costs of financial
assets carried at fair value through profit or loss are expensed in statement of profit
or loss. Purchases or sales of financial assets that require delivery of assets within a
time frame established by regulation or convention in the market place (regular way
trades) are recognized on the trade date, i.e., the date that the Company commits to
purchase or sell the asset.

Financial assets at amortised cost

Financial assets are subsequently measured at amortised cost if these financial assets are
held within a business whose objective is to hold these assets to collect contractual cash
flows and the contractual terms of the financial assets give rise on specified dates to cash
flows that are solely payments of principal and interest on the principal amount
outstanding.

Financial assets at fair value through other comprehensive income

Financial assets are measured at fair value through other comprehensive income if these
financial assets are held within a business whose objective is achieved by both collecting
contractual cash flows on specified dates that are solely payments of principal and
interest on the principal amount outstanding and selling financial assets.

Financial assets at fair value through profit or loss

Financial assets are measured at fair value through profit or loss unless it is
measured at amortised cost or at fair value through other comprehensive income
on initial recognition. The transaction costs directly attributable to the acquisition of
financial assets and liabilities at fair value through profit or loss are immediately
recognised in profit or loss.

iii. Derecognition:

A financial asset or where applicable, a part of a financial asset is primarily derecognised
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 (a) the Company has transferred
substantially all the risks and rewards of the asset, or (b) 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.

iv. Impairment of financial assets:

In accordance with Ind AS 109, the Company applies expected credit loss (ECL) model
for measurement and recognition of impairment loss on the debt instruments, that are
measured at amortised cost e.g., loans, debt securities, deposits and trade receivables.

Expected credit loss 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.

The management uses a provision matrix to determine the impairment loss on the
portfolio of trade and other receivables. Provision matrix is based on its historically
observed expected credit loss rates over the expected life of the trade receivables and is
adjusted for forward looking estimates.

Expected credit loss allowance or reversal recognised during the period is recognised as
income or expense, as the case may be, in the statement of profit and loss. In case of
balance sheet, it is shown as reduction from the specific financial asset.

2.Financial liabilities

Financial liabilities are measured at amortised cost using the effective interest method.
Equity instruments

An equity instrument is a contract that evidences residual interest in the assets of the
company after deducting all of its liabilities. Equity instruments recognised by the
Company are recognised at the proceeds received net off direct issue cost.

i) Initial recognition and measurement:

At initial recognition, all financial liabilities are recognised at fair value and in the case
of loans, borrowings and payables, net of directly attributable transaction costs.

ii) Subsequent measurement:

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

b. Financial liabilities at amortised cost:

Amortised cost, in case of financial liabilities with maturity more than one year, is
calculated by discounting the future cash flows with effective interest rate.

The effective interest rate amortisation is included as finance costs in the Statement
of Profit and Loss.

Financial liability with maturity of less than one year is shown at transaction value.

iii. Derecognition:

A financial liability is derecognised when the obligation under the liability is discharged
or cancelled or expires. The difference between the carrying amount of a financial
liability that has been extinguished or transferred to another party and the consideration
paid, including any non-cash assets transferred or liabilities assumed, is recognised in
profit or loss as other income or finance costs.

m) Cash and cash equivalents

The Company considers all highly liquid financial instruments, which are readily
convertible into known amounts of cash that are subject to an insignificant risk of
change in value and having original maturities of three months or less from the date of
purchase, to be cash equivalents. Cash and cash equivalents consist of balances with
banks which are unrestricted for withdrawal and usage.

n) Financial Guarantee Contracts:

A financial guarantee contract is a contract that requires the issuer to make specified
payments to reimburse the holder for a loss it incurs because a specified debtor fails to
make payment when due in accordance with original or modified terms of a debt
instrument.

The Company measures any financial guarantee on initial recognition at their fair value.
Subsequently these contracts are measured at the higher of:

a. the amount of the loss allowance determined as per impairment requirements of Ind
AS 109, and

b. the amount initially recognised, less where appropriate, cumulative amount of
income recognized in accordance with the principles of Ind AS 18.

o) Fair V alue Measurement:

The Company measures financial instruments 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 such asset or liability,
or in the absence of a principal market, in the most advantageous market which is
accessible to 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, maximizing the use of
relevant observable inputs and minimizing the use of unobservable inputs.

All assets and liabilities for which fair value is measured or disclosed in the financial
statements are categorized 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:

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

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

c. Level 3 - Valuation techniques for which the lowest level input that is significant to
the fair value measurement is unobservable.

p) Investment in subsidiaries

Investment in subsidiaries are measured at cost less impairment.

q) Property, plant and equipment

Property, plant and equipment are stated at cost net of input tax credits, less
accumulated depreciation and accumulated impairment losses, if any. Cost comprises
the purchase price and all attributable cost, to bring the asset to its working condition for
its intended use. Borrowing costs relating to acquisition of property, plant and
equipment which take substantial period of time to get ready for its intended use are
also included to the extent they relate to the period till such assets are ready to put to
use.

The Company adopted cost model as its accounting policy, in recognition of the
property, plant and equipment and recognises transaction value as the cost.

An item of Property, Plant and Equipment is derecognised upon disposal or when no
future economic benefits are expected from its use. Any gain or loss arising on
derecognition of the asset (calculated as the difference between the net disposal
proceeds and the carrying amount of the asset) is recognised in the Statement of Profit
and Loss. Property, Plant and Equipment which are found to be not usable or retired
from active use or when no further benefits are expected from their use are removed
from property, plant and equipment and the carrying amount net of scrap value, if any
is charged to Statement of Profit and Loss.

The improvements/modifications carried on the lease hold land/property are
recognised as lease hold improvements and are written off over the primary lease period
or the life of such improvement whichever is lower.

r) Intangible assets

Intangible assets purchased are measured at cost as of the date of acquisition, as
applicable, less accumulated amortisation and accumulated impairment, if any.

Intangible assets consist of rights under licensing agreement and software licences
which are amortised over license period which equates the useful life ranging between
5-6 years on a straight line basis.

s) Impairment of Non-financial assets

i. The carrying amounts of assets are reviewed at each balance sheet date if there is
any indication of impairment based on internal/ external factors. An impairment
loss is recognized wherever the carrying amount of an asset exceeds its
recoverable amount. The recoverable amount is the greater of the asset''s net
selling price and value in use. In assessing value in use, the estimated future cash
flows are discounted to their present value at the weighted average cost of
capital. After impairment, depreciation is provided on the revised carrying
amount of the asset over its remaining useful life.

ii. Reversal of impairment losses recognised in prior years is recorded when there is
an indication that the impairment losses recognised for the asset are no longer
existing or have decreased.

t) Employee benefits

i. Defined benefit plans

For defined benefit plans, the cost of providing benefits is determined using the
Projected Unit Credit Method, with actuarial valuations being carried out at each
Balance sheet date. Actuarial gains and losses are recognised in full in the other
comprehensive income for the period in which they occur. Past service cost both
vested and unvested is recognised as an expense at the earlier of (a) when the
plan amendment or curtailment occurs; and (b) when the entity recognises
related restructuring costs or termination benefits.

The retirement benefit obligations recognised in the Balance sheet
represents the present value of the defined benefit obligations reduced by
the fair value of scheme assets. Any asset resulting from this calculation is
limited to the present value of available refunds and deductions in future
contributions to the scheme.

ii. Defined contribution plans

Employer''s contribution to provident fund/ employee state insurance which is

in the nature of defined contribution scheme is expensed off when the
contributions to the respective funds are due. There are no other obligations
other than the contribution payable to the fund.

iii. Compensated absences

Compensated absences which are not expected to occur within twelve months
after the end of the period in which the employee renders the related services are
recognised as an actuarially determined liability at the present value of the
defined benefit obligation at the Balance sheet date.

u) Earnings per share

Basic earnings per share are computed by dividing profit or loss
attributable to equity shareholders of the Company by the weighted
average number of equity shares outstanding during the year. The Company did
not have any potentially dilutive securities in any of the
years'' presented.

v) Borrowing Costs:

Borrowing costs directly attributable to the acquisition, construction or
production of an asset that necessarily takes a substantial period of time to get
ready for its intended use or sale are capitalised as part of the cost of the asset.
All other borrowing costs are expensed in the period in which they occur.
Borrowing costs consist of interest and other costs that an entity incurs in
connection with the borrowing of funds. Borrowing cost also includes exchange
differences to the extent regarded as an adjustment to the borrowing costs.

w) Segment Reporting:

Operating segments are reported in a manner consistent with the internal
reporting provided to the Chief operating decision maker ("CODM").

The board of directors of the company has identified the Chairman and
Managing Director as the CODM.

---

Mar 31, 2022

1. Corporate Information:

Brightcom Group Limited, offers digital marketing solutions to businesses, agencies and online publishers worldwide. Brightcom Group Limited connects Advertisers with their Audience across any form of Digital Media, using its massive local presence to deliver appropriate messages to the right audience, through the most relevant Digital channels. Brightcom Group Limited has a global presence, with offices in over 24 countries. Brightcom Group Limited is also a Global Information Technology Implementation and Outsourcing Services Provider with an exceptional track record of providing high quality, on-budget, and on-time solutions to demanding clients specifically in the areas of Digital Media advertising and in the fields of AI, ML, IOT to name a few. Our business knowledge in key verticals helps us provide solutions that are customized to address the specific needs while focusing on maximizing value of Information Technology investments such that clients can achieve their business objectives. We believe in fostering long-term relationships, and partner with our clients in their success. BCG Provides End-to-end Enterprise Solution Offerings and Specializing in ERP Solutions, Microsoft and Open Source Systems development.

2. SIGNIFICANT ACCOUNTING POLICIES

a) Statement of compliance

These financial statements have been prepared in accordance with Ind AS as notified under the Companies (Indian Accounting Standards)Rules, 2015 read with Section 133 of the Companies Act, 2013 read with rule 3 of companies (Indian accounting standards)Rules,2015("the rules")(as amended from time to time).

b) Basis of preparation

These financial statements have been prepared on the historical cost basis, except for certain financial instruments which are measured at fair values at the end of each reporting period, as explained in the accounting policies below. Historical cost is generally based on the fair value of the consideration given in exchange for goods and

services. 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.

c) Use of estimates and judgements

The preparation of these financial statements in conformity with the recognition and measurement principles of Ind AS requires the management of the Company to make estimates and assumptions that affect the reported balances of assets and liabilities, disclosures relating to contingent liabilities as at the date of the financial statements and the reported amounts of income and expense for the periods presented.

Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognized in the period in which the estimates are revised and future periods are affected.

Key sources of estimation of uncertainty at the date of the financial statements, which may cause a material adjustment to the carrying amounts of assets and liabilities within the next financial year, is in respect of impairment of investments, useful lives of property, plant and equipment, valuation of deferred tax assets, provisions and contingent liabilities.

Impairment of investments

The Company reviews its carrying value of investments carried at amortized cost annually, or more frequently when there is indication for impairment. If the recoverable amount is less than its carrying amount, the impairment loss is accounted for.

Useful lives of property, plant and equipment

The Company reviews the useful life of property, plant and equipment at the end of each reporting period. This reassessment may result in change in depreciation expense in future periods.

Valuation of deferred tax assets

The Company reviews the carrying amount of

deferred tax assets at the end of each reporting

period.

Contingencies

Management judgment is required for estimating the possible inflow/outflow of resources, if any, in respect of contingencies/ claims/litigations against the Company/by the Company as it is not possible to predict the outcome of pending matters with accuracy.

Defined Benefit Plans

The present value of the gratuity obligation is determined using actuarial valuation. An actuarial valuation involves making various assumptions that may differ from actual developments in the future. These include the determination of the discount rate, rate of increment in salaries and mortality rates. Due to complexities involved in the valuation and

its long-term nature, a defined benefit obligation is highly sensitive to changes in these assumptions. All the assumptions are reviewed at each reporting date.

Fair Value measurement of financial instruments

When the fair values of financial assets and financial liabilities on reporting date cannot be measured based on quoted prices in active markets, their fair value is measured using valuation techniques i.e., the DCF model. The inputs to these models are taken from observable markets.

Intangibles

Internal technical or user team assess the useful lives of Intangible assets. Management believes that assigned useful lives are reasonable.

d) Current Vs Non-current classifications

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

An asset is treated as current when it satisfies the below mentioned criteria:

i. Expected to be realized or intended to be sold or consumed in normal operating cycle;

ii. Held primarily for the purpose of trading;

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

iv. Cash or cash equivalent unless restricted from being exchanged or used to settle a liability for at least twelve months after the reporting period. All other assets are classified as non-current assets.

A liability is classified as current when it satisfies the below mentioned criteria:

i. Expected to settle the liability in normal operating cycle;

ii. Held primarily for the purpose of trading;

iii. Due to be settled within twelve months after the reporting period, or

iv. There is no unconditional right to defer the settlement of the liability for at least twelve months after the reporting period.

All other liabilities are classified as noncurrent. Deferred tax assets and liabilities are classified as non-current assets and liabilities.

The operating cycle is the time between the acquisition of assets for processing and their realization in cash and cash equivalents.

e) Dividends

Annual dividend distribution to the shareholders is recognized as a liability in the period in which the dividend is approved by the shareholders. Any interim dividend paid is recognized on approval by Board of Directors. Dividend payable and corresponding tax on dividend distribution is recognized directly in equity.

f) Revenue recognition

l) Digital Marketing Services:

i) The Contracts between the Company and its Customers are either time or material contracts or fixed price contracts.

ii) Revenue from fixed price contracts is recognized according to the milestones achieved as specified in the contracts on the proportionate-completion method based on the work completed. Any anticipated losses expected upon the contract completion are recognized immediately. Changes in job performance, conditions and estimated profitability may result in revisions and corresponding revenues and costs are recognized in the period in which such changes are identified. Deferred revenue represents amounts billed in excess of revenue earned for which related services are expected to be performed in the next operating cycle.

iii) In respect of time and material contract, revenue is recognized in the period in which the services are provided and related costs are incurred.

iv) Revenue from product sale and licensing arrangements are recognized on delivery and installation.

v) Revenue is reported net of discounts, indirect and service taxes.

2) Software Development:

i) Income from software development is accounted for on the basis of Software developed and billed to clients on acceptance and/or on the basis of man days/man hours as per the terms of contract.

ii) Revenue from professional services consist primarily of revenue earned from services performed on a ''time and material'' basis. The related revenue is recognized as and when the services are performed and related costs are incurred.

iii) Revenue from software development services includes revenue from time and material and fixed price contracts are recognized as related services are performed.

iv) Revenue from fixed price contracts is recognized according to the milestones achieved as specified in the contracts on the proportionate-completion method based on the work completed. Any anticipated losses expected upon the contract completion are recognized immediately. Changes in job performance, conditions and estimated profitability may result in revisions and corresponding revenues and costs are recognized in the period in which such changes are identified. Deferred revenue represents amounts billed in excess of revenue earned for which related services are expected to be performed in the next operating cycle.

v) Revenue is not recognized on the grounds of

prudence, until realized in respect of liquidated damages, delayed payments as recovery of the amounts are not certain.

vi) Revenue is reported net of discounts, indirect and

service taxes.

g)Dividend income is recorded when the right to

receive payment is established.

Interest income is recorded using the effective

interest method.

h) Leases

The Company''s lease asset classes primarily consist of leases for land and buildings. The Company assesses whether a contract contains a lease, at inception of a contract. A contract is, or contains, a lease if the contract conveys the right to control the use of an identified asset for a period of time in exchange for consideration. To assess whether a contract conveys the right to control the use of an identified asset, the Company assesses whether: (i) the contract involves the use of an identified asset(ii) the Company has substantially all of the economic benefits from use of the asset through the period of the lease and (iii)the Company has the right to direct the use of the asset. At the date of commencement of the lease, the Company recognizes a right-of-use (ROU) asset and a corresponding lease liability for all lease arrangements in which it is a lessee, except for leases with a term of 12 months or less(short-term leases) and low value leases. For these short-term and low-value leases, the Company recognizes the lease payments as an operating expense on a straight-line basis over the term of the lease.

Certain lease arrangements includes the options to extend or terminate the lease before the end of the lease term. ROU assets and lease liabilities includes these options when it is reasonably certain that they will be exercised. The ROU assets are initially recognized at cost, which comprises the initial amount of the lease liability adjusted for any lease payments made at or prior to the commencement date of the lease plus any initial direct costs less any lease incentives. They are subsequently measured at cost less accumulated depreciation and impairment losses. ROU assets are depreciated from the commencement date on a straight-line basis over the shorter of the lease term and useful life of the underlying asset.

The lease liability is initially measured at amortized cost at the present value of the future lease payments. The lease payments are discounted using the interest rate implicit in the lease or, if not readily determinable, using the incremental borrowing rates in the country of domicile of these leases. Lease liabilities are re-measured with a

corresponding adjustment to the related ROU asset if the Company changes its assessment of whether it will exercise an extension or a termination option

i) Cost recognition

Costs and expenses are recognized as and when incurred and have been classified according to their nature.

The costs of the Company are broadly categorized in employee benefit expenses, depreciation and amortization and other operating expenses. Employee benefit expenses include employee compensation, allowances paid, contribution to various funds and staff welfare expenses. Other operating expenses mainly include fees to external consultants, cost of running its facilities, travel expenses, cost of equipment and software licenses, communication costs, allowances for delinquent receivables and advances and other expenses. Other expenses are an aggregation of costs which are individually not material such as commission and brokerage, recruitment and training, entertainment etc.

j) . Foreign currency transactions

i. Functional and Presentation Currency:

The Company''s functional and presentation currency is Indian National Rupee.

ii. Initial Recognition:

Foreign currency transactions are recorded in the presentation currency, by applying to the foreign currency amounts the exchange rate between the Presentation currency and the foreign currency at the date of the transaction.

iii. Conversion on reporting date:

Foreign currency monetary items are reported using the closing rate. Non-monetary items that are measured in terms of historical cost in a foreign currency are translated using the exchange rates at the dates of the initial transactions.

iv. Exchange Differences:

Exchange difference arising on the settlement of monetary items or on Presenting monetary items of Company at rates different from those at which they were initially recorded during the year or presented in previous financial statements are recognized as income or as expenses in the year in which they arise.

k) Income taxes

Income tax expense comprises current tax expense and the net change in the deferred tax asset or

liability during the year. Current and deferred tax are recognized in statement of profit and loss, except when they relate to items that are recognized in other comprehensive income or directly in equity, in which case, the current and deferred tax are also recognized in other comprehensive income or directly in equity, respectively.

Current income taxes

The current income tax expense includes income taxes payable by the Company, its branches in India and overseas. The current tax payable by the Company in India is Indian income tax payable on worldwide income.

The Current income tax payable by overseas branches of the Company is computed in accordance with the tax laws applicable in the jurisdiction in which the respective branch operates. The taxes paid are generally available for set off against the Indian income tax liability of the Company''s worldwide income.

Advance taxes and provisions for current income taxes are presented in the Balance sheet after offsetting advance tax paid and income tax provision arising in the same tax jurisdiction and where the relevant tax paying units intends to settle the asset and liability on a net basis.

Deferred income taxes

Deferred income tax is recognized using the Balance sheet approach. Deferred income tax assets and liabilities are recognized for deductible and taxable temporary differences arising between the tax base of assets and liabilities and their carrying amount, except when the deferred income tax arises from the initial recognition of goodwill or an asset or liability in a transaction that is not a business combination and affects neither accounting nor taxable profit or loss at the time of the transaction.

Deferred income tax asset are recognized to the extent that it is probable that taxable profit will be available against which the deductible temporary differences and the carry forward of unused tax credits and unused tax losses can be utilized.

The carrying amount of deferred income tax assets is reviewed at each reporting date and reduced to the extent that it is no longer probable that

sufficient taxable profit will be available to allow all or part of the deferred income tax asset to be utilized.

Deferred tax assets and liabilities are measured using substantively enacted tax rates expected to apply to taxable income in the years in which the temporary differences are expected to be received or settled.

Deferred tax assets and liabilities are offset when they relate to income taxes levied by the same taxation authority and the relevant entity intends to settle its current tax assets and liabilities on a net basis.

Deferred tax assets include Minimum Alternative Tax (MAT) paid in accordance with the tax laws in India, which is likely to give future economic benefits in the form of availability of set off against future income tax liability. Accordingly, MAT is recognized as deferred tax asset in the Balance sheet when the asset can be measured reliably and it is probable that the future economic benefit associated with the asset will be realized.

l) 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.

1. Financial Assets.

i) Initial recognition and measurement:

All financial assets are recognized initially at fair value plus, in the case of financial assets not recorded at fair value through profit or loss, transaction costs that are attributable to the acquisition of the financial asset. Transaction costs of financial assets carried at fair value through profit or loss are expensed in statement of profit or loss. Purchases or sales of financial assets that require delivery of assets within a time frame established by regulation or convention in the market place (regular way trades) are recognized on the trade date, i.e., the date that the Company commits to purchase or sell the asset.

ii) Subsequent measurement:

Financial assets at amortized cost

Financial assets are subsequently measured at amortized cost if these financial assets are held within a business whose objective is to hold these assets to collect contractual cash flows and the

contractual terms of the financial assets give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.

Financial assets at fair value through other comprehensive income

Financial assets are measured at fair value through other comprehensive income if these financial assets are held within a business whose objective is achieved by both collecting contractual cash flows on specified dates that are solely payments of principal and interest on the principal amount outstanding and selling financial assets.

Financial assets at fair value through profit or loss

Financial assets are measured at fair value through profit or loss unless it is measured at amortized cost or at fair value through other comprehensive income on initial recognition. The transaction costs directly attributable to the acquisition of financial assets and liabilities at fair value through profit or loss are immediately recognized in profit or loss.

iii. Derecognition:

A financial asset or where applicable, a part of a financial asset is primarily derecognised 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 (a) the Company has transferred substantially all the risks and rewards of the asset, or (b) 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.

iv. Impairment of financial assets:

In accordance with Ind AS 109, the Company applies expected credit loss (ECL) model for measurement and recognition of impairment loss on the debt instruments, that are measured at amortised cost e.g., loans, debt securities, deposits and trade receivables.

Expected credit loss 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.

The management uses a provision matrix to determine the impairment loss on the portfolio of trade and other receivables. Provision matrix is based on its historically observed expected credit loss rates over the expected life of the trade receivables and is adjusted for forward looking estimates.

Expected credit loss allowance or reversal recognized during the period is recognized as income or expense, as the case may be, in the statement of profit and loss. In case of balance sheet, it is shown as reduction from the specific financial asset.

2. Financial liabilities

Financial liabilities are measured at amortized cost using the effective interest method.

Equity instruments

An equity instrument is a contract that evidences residual interest in the assets of the company after deducting all of its liabilities. Equity instruments recognized by the Company are recognized at the proceeds received net off direct issue cost.

i) Initial recognition and measurement:

At initial recognition, all financial liabilities are recognized at fair value and in the case of loans, borrowings and payables, net of directly attributable transaction costs.

ii) Subsequent measurement:a. 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. Gain or losses on liabilities held for trading are recognized in the profit or loss.

b. Financial liabilities at amortized cost:

Amortized cost, in case of financial liabilities with maturity more than one year, is calculated by discounting the future cash flows with effective interest rate.

The effective interest rate amortization is included as finance costs in the Statement of Profit and Loss. Financial liability with maturity of less than one year is shown at transaction value.

iii. Derecognition:

A financial liability is derecognised when the obligation under the liability is discharged or cancelled or expires. The difference between the carrying amount of a financial liability that has been extinguished or transferred to another party and the consideration paid, including any noncash assets transferred or liabilities assumed, is recognised in profit or loss as other income or finance costs.

m) Cash and cash equivalents

The Company considers all highly liquid financial instruments, which are readily convertible into known amounts of cash that are subject to an insignificant risk of change in value and having original maturities of three months or less from the date of purchase, to be cash equivalents. Cash and cash equivalents consist of balances with banks which are unrestricted for withdrawal and usage.

n) Financial Guarantee Contracts:

A financial guarantee contract is a contract that requires the issuer to make specified payments to reimburse the holder for a loss it incurs because a specified debtor fails to make payment when due in accordance with original or modified terms of a debt instrument.

The Company measures any financial guarantee on initial recognition at their fair value. Subsequently these contracts are measured at the higher of:

a. the amount of the loss allowance determined as per impairment requirements of Ind AS 109, and

b. the amount initially recognized, less where appropriate, cumulative amount of income

recognized in accordance with the principles of Ind AS 18.

o) Fair Value Measurement:

The Company measures financial instruments 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 such asset or liability, or in the absence of a principal market, in the most advantageous market which is accessible to 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, maximizing the use of relevant observable inputs and minimizing the use of unobservable inputs.

All assets and liabilities for which fair value is measured or disclosed in the financial statements are categorized 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:

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

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

c. Level 3 - Valuation techniques for which the lowest level input that is significant to the fair value measurement is unobservable.

p) Investment in subsidiaries

Investment in subsidiaries are measured at cost

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q) Property, plant and equipment

Property, plant and equipment are stated at cost net of input tax credits, less accumulated depreciation and accumulated impairment losses, if any. Cost comprises the purchase price and all attributable cost, to bring the asset to its working condition for its intended use. Borrowing costs relating to acquisition of property, plant and equipment which take substantial period of time to get ready for its intended use are also included to the extent they relate to the period till such assets are ready to put to use.

The Company adopted cost model as its accounting policy, in recognition of the property, plant and equipment and recognizes transaction value as the cost.

An item of Property, Plant and Equipment is derecognised upon disposal or when no future economic benefits are expected from its use. Any gain or loss arising on derecognition of the asset (calculated as the difference between the net disposal proceeds and the carrying amount of the asset) is recognized in the Statement of Profit and Loss. Property, Plant and Equipment which are found to be not usable or retired from active use or when no further benefits are expected from their use are removed from property, plant and equipment and the carrying amount net of scrap value, if any is charged to Statement of Profit and Loss.

The improvements/modifications carried on the lease hold land/property are recognized as lease hold improvements and are written off over the primary lease period or the life of such improvement whichever is lower.

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Type of asset	Method	Useful lives
Computer equipment	Straight line	3 years
Office equipment''s	Straight line	5 years
Furniture and fixtures	Straight line	10 years
Electrical installations	Straight line	10 years
Vehicles	Straight line	8 years

r) Intangible assets

Intangible assets purchased are measured at cost as of the date of acquisition, as applicable, less accumulated amortization and accumulated impairment, if any.

Intangible assets consist of rights under licensing agreement and software licences which are

amortized over license period which equates the useful life ranging between 5-6 years on a straight line basis.

s) Impairment of Non-financial assets

i. The carrying amounts of assets are reviewed at each balance sheet date if there is any indication of impairment based on internal/external factors. An impairment loss is recognized wherever the carrying amount of an asset exceeds its recoverable amount. The recoverable amount is the greater of the asset''s net selling price and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value at the weighted average cost of capital. After impairment, depreciation is provided on the revised carrying amount of the asset over its remaining useful life.

ii. Reversal of impairment losses recognized in prior years is recorded when there is an indication that the impairment losses recognized for the asset do no longer exist or have decreased.

t) Employee benefits

i. Defined benefit plans

For defined benefit plans, the cost of providing benefits is determined using the Projected Unit Credit Method, with actuarial valuations being carried out at each Balance sheet date. Actuarial gains and losses are recognized in full in the other comprehensive income for the period in which they occur. Past service cost both vested and unvested is recognized as an expense at the earlier of (a) when the plan amendment or curtailment occurs; and (b) when the entity recognizes related restructuring costs or termination benefits.

The retirement benefit obligations recognized in the Balance sheet represents the present value of the defined benefit obligations reduced by the fair value of scheme assets. Any asset resulting from this calculation is limited to the present value of available refunds and deductions in future contributions to the scheme.

ii. Defined contribution plans

Employer''s contribution to provident fund/ employee state insurance which is in the nature of defined contribution scheme is expensed off when the contributions to the respective funds are due.

There are no other obligations other than the contribution payable to the fund.

iii. Compensated absences

Compensated absences which are not expected to occur within twelve months after the end of the period in which the employee renders the related services are recognized as an actuarially determined liability at the present value of the defined benefit obligation at the Balance sheet date.

u) Earnings per share

Basic earnings per share are computed by dividing profit or loss attributable to equity shareholders of the Company by the weighted average number of equity shares outstanding during the year. The Company did not have any potentially dilutive securities in any of the years'' presented.

v) Borrowing Costs:

Borrowing costs directly attributable to the acquisition, construction or production of an asset that necessarily takes a substantial period of time to get ready for its intended use or sale are capitalized as part of the cost of the asset. All other borrowing costs are expensed in the period in which they occur. Borrowing costs consist of interest and other costs that an entity incurs in connection with the borrowing of funds. Borrowing cost also includes exchange differences to the extent regarded as an adjustment to the borrowing costs.

w) Segment Reporting:

Operating segments are reported in a manner consistent with the internal reporting provided to the Chief operating decision maker ("CODM").

The board of directors of the company has identified the Chairman and Managing Director as the CODM.

x) Provisions:

Provisions are recognized when there is a present legal or constructive obligation that can be estimated reliably, as a result of a past event, when it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and a reliable estimate can be made of the amount of the obligation.

Provisions are not recognized for future operating losses.

Any reimbursement that the Company can be virtually certain to collect from a third party with respect to the obligation is recognized as a separate asset. However, this asset may not exceed the amount of the related provision.

y) Contingencies:

Where it is not probable that an inflow or an outflow of economic resources will be required, or the amount cannot be estimated reliably, the asset or the obligation is not recognized in the statement of balance sheet and is disclosed as a contingent asset or contingent liability. Possible outcomes on obligations / rights, whose existence will only be confirmed by the occurrence or non-occurrence of one or more future events, are also disclosed as contingent assets or contingent liabilities.

z) Prior period items:

In case prior period adjustments are material in nature the Company prepares the restated financial statement as required under Ind AS 8 - "Accounting Policies, Changes in Accounting Estimates and Errors". Immaterial items pertaining to prior periods are shown under respective items in the Statement of Profit and Loss.

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Mar 31, 2018

LYCOS INTERNET LIMITED

Notes forming part of Standalone statements for the year ended 31st March 2018

1. Corporate Information:

Lycos Internet Limited, offers digital marketing solutions to businesses, agencies and online publishers worldwide. Lycos Internet Limited connects Advertisers with their Audience across any form of Digital Media, using its massive local presence to deliver appropriate messages to the right audience, through the most relevant Digital channels. Lycos Internet Limited has a global presence, with offices in over 24 countries.

Lycos Internet Limited is also a Global Information Technology Implementation and Outsourcing Services Provider with an exceptional track record of providing high quality, on-budget, and on-time solutions to demanding clients. Our business knowledge in key verticals helps us provide solutions that are customized to address the specific needs while focusing on maximizing value of Information Technology investments such that clients can achieve their business objectives. We believe in fostering long-term relationships, and partner with our clients in their success. Lycos Provides End-to-end Enterprise Solution Offerings and Specializing in ERP Solutions, Microsoft and Open Source Systems development.

2. SIGNIFICANT ACCOUNTING POLICIES

a. Statement of compliance

These financial statements have been prepared in accordance with Ind AS as notified under the Companies (Indian Accounting Standards)Rules, 2015 read with Section 133 of the Companies Act, 2013 read with rule 3 of companies (Indian accounting standards) Rules,2015("the rules")(as amended).

b. Basis of preparation

These financial statements have been prepared on the historical cost basis, except for certain financial instruments which are measured at fair values at the end of each reporting period, as explained in the accounting policies below. Historical cost is generally based on the fair value of the consideration given in exchange for goods and services. 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.

c. Use of estimates and judgements

The preparation of these financial statements in conformity with the recognition and measurement principles of Ind AS requires the management of the Company to make estimates and assumptions that affect the reported balances of assets and liabilities, disclosures relating to contingent liabilities as at the date of the financial statements and the reported amounts of income and expense for the periods presented.

Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimates are revised and future periods are affected.

Key sources of estimation of uncertainty at the date of the financial statements, which may cause a material adjustment to the carrying amounts of assets and liabilities within the next financial year, is in respect of impairment of investments, useful lives of property, plant and equipment, valuation of deferred tax assets, provisions and contingent liabilities.

Impairment of investments

The Company reviews its carrying value of investments carried at amortised cost annually, or more frequently when there is indication for impairment. If the recoverable amount is less than its carrying amount, the impairment loss is accounted for.

Useful lives of property, plant and equipment

The Company reviews the useful life of property, plant and equipment at the end of each reporting period. This reassessment may result in change in depreciation expense in future periods.

Valuation of deferred tax assets

The Company reviews the carrying amount of deferred tax assets at the end of each reporting period.

Contingencies

Management judgement is required for estimating the possible inflow/outflow of resources, if any, in respect of contingencies/ claims/litigations against the Company/by the Company as it is not possible to predict the outcome of pending matters with accuracy.

Defined Benefit Plans

The present value of the gratuity obligation is determined using actuarial valuation. An actuarial valuation involves making various assumptions that may differ from actual developments in the future. These include the determination of the discount rate, rate of increment in salaries and mortality rates. Due to complexities involved in the valuation and its long-term nature, a defined benefit obligation is highly sensitive to changes in these assumptions. All the assumptions are reviewed at each reporting date.

Fair Value measurement of financial instruments

When the fair values of financial assets and financial liabilities on reporting date cannot be measured based on quoted prices in active markets, their fair value is measured using valuation techniques i.e., the DCF model. The inputs to these models are taken from observable markets.

Intangibles

Internal technical or user team assess the useful lives of Intangible assets. Management believes that assigned useful lives are reasonable.

d. Current Vs Non-current classifications

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

An asset is treated as current when it satisfies the below mentioned criteria:

i. Expected to be realised or intended to be sold or consumed in normal operating cycle; ii. Held primarily for the purpose of trading; iii. Expected to be realised within twelve months after the reporting period, or iv. Cash or cash equivalent unless restricted from being exchanged or used to settle a liability for at least twelve months after the reporting period. All other assets are classified as non-current assets.

A liability is classified as current when it satisfies the below mentioned criteria:

i. Expected to settle the liability in normal operating cycle;

ii. Held primarily for the purpose of trading;

iii. Due to be settled within twelve months after the reporting period, or

iv. There is no unconditional right to defer the settlement of the liability for at least twelve months after the reporting period.

All other liabilities are classified as noncurrent. Deferred tax assets and liabilities are classified as non-current assets and liabilities.

The operating cycle is the time between the acquisition of assets for processing and their realisation in cash and cash equivalents, acceptance and/or on the basis of man days/man hours as per the terms of contract.

ii) Revenue from professional services consist primarily of revenue earned from services performed on a ''time and material'' basis. The related revenue is recognized as and when the services are performed and related costs are incurred.

iii) Revenue from software development services includes revenue from time and material and fixed price contracts are recognized as related services are performed.

iv) Revenue from fixed price contracts is recognized according to the milestones achieved as specified in the contracts on the proportionate-completion method based on the work completed. Any anticipated losses expected upon the contract completion are recognized immediately. Changes in job performance, conditions and estimated profitability may result in revisions and corresponding revenues and costs are recognized in the period in which such changes are identified. Deferred revenue represents amounts billed in excess of revenue earned for which related services are expected to be performed in the next operating cycle.

v) Revenue is not recognized on the grounds of prudence, until realized in respect of liquidated damages, delayed payments as recovery of the amounts are not certain.

vi) Revenue is reported net of discounts, indirect and service taxes.

e. Dividends

Annual dividend distribution to the shareholders is recognised as a liability in the period in which the dividend is approved by the shareholders. Any interim dividend paid is recognised on approval by Board of Directors. Dividend payable and corresponding tax on dividend distribution is recognised directly in equity.

f. Revenue recognition

1) Digital Marketing Services:

i) The Contracts between the Company and its Customers are either time or material contracts or fixed price contracts.

ii) Revenue from fixed price contracts is recognized according to the milestones achieved as specified in the contracts on the proportionate-completion method based on the work completed. Any anticipated losses expected upon the contract completion are recognized immediately. Changes in job performance, conditions and estimated profitability may result in revisions and corresponding revenues and costs are recognized in the period in which such changes are identified. Deferred revenue represents amounts billed in excess of revenue earned for which related services are expected to be performed in the next operating cycle.

iii) In respect of time and material contract, revenue is recognized in the period in which the services are provided and related costs are incurred.

iv) Revenue from product sale and licensing arrangements are recognized on delivery and installation.

v) Revenue is reported net of discounts, indirect and service taxes

2) Software Development:

i) Income from software development is accounted for on the basis of Software developed and billed to clients on

g) Dividend income is recorded when the right to receive payment is established. Interest income is recorded using the effective interest method.

h) Leases

Operating Lease:

Leases where the lessor retains substantially all the risks and rewards of ownership are classified as operating leases. The company charges Lease rentals in respect of assets taken under operating leases to statement profit and loss account on a straight line basis over the lease term.

Finance Lease:

A Finance lease is a lease that transfers substantially all the risks and rewards incidental to the ownership of an asset to the lessee. Such leases are capitalised at the inception of the lease at lower of the fair value or the present value of the minimum lease payments and a liability is recognised for an equivalent amount. Each lease rental paid is allocated between the liability and the interest cost so as to obtain a constant periodic rate of interest on the outstanding liability for each year.

i) Cost recognition

Costs and expenses are recognised as and when incurred and have been classified according to their nature.

The costs of the Company are broadly categorized in employee benefit expenses, depreciation and amortisation and other operating expenses. Employee benefit expenses include employee compensation, allowances paid, contribution to various funds and staff welfare expenses. Other operating expenses mainly include fees to external consultants, cost of running its facilities, travel expenses, cost of equipment and software licenses, communication costs, allowances for delinquent receivables and advances and other expenses. Other expenses is an aggregation of costs which are individually not material such as commission and brokerage, recruitment and training, entertainment etc.

j) Foreign currency transactions

i. Functional and Presentation Currency:

The Company''s functional and presentation currency is Indian National Rupee.

ii. Initial Recognition:

Foreign currency transactions are recorded in the presentation currency, by applying to the foreign currency amounts the exchange rate between the Presentation currency and the foreign currency at the date of the transaction.

iii. Conversion on reporting date:

Foreign currency monetary items are reported using the closing rate. Non-monetary items that are measured in terms of historical cost in a foreign currency are translated using the exchange rates at the dates of the initial transactions.

iv. Exchange Differences:

Exchange difference arising on the settlement of monetary items or on Presenting monetary items of Company at rates different from those at which they were initially recorded during the year or presented in previous financial statements are recognised as income or as expenses in the year in which they arise.

k) Income taxes

Income tax expense comprises current tax expense and the net change in the deferred tax asset or liability during the year. Current and deferred tax are recognised in statement of profit and loss, except when they relate to items that are recognised in other comprehensive income or directly in equity, in which case, the current and deferred tax are also recognised in other comprehensive income or directly in equity, respectively.

Current income taxes

The current income tax expense includes income taxes payable by the Company, its branches in India and overseas. The current tax payable by the Company in India is Indian income tax payable on worldwide income.

The Current income tax payable by overseas branches of the Company is computed in accordance with the tax laws applicable in the jurisdiction in which the respective branch operates. The taxes paid are generally available for set off against the Indian income tax liability of the Company''s worldwide income.

Advance taxes and provisions for current income taxes are presented in the Balance sheet after off-setting advance tax paid and income tax provision arising in the same tax jurisdiction and where the relevant tax paying units intends to settle the asset and liability on a net basis.

Deferred income taxes

Deferred income tax is recognised using the Balance sheet approach. Deferred income tax assets and liabilities are recognised for deductible and taxable temporary differences arising between the tax base of assets and liabilities and their carrying amount, except when the deferred income tax arises from the initial recognition of goodwill or an asset or liability in a transaction that is not a business combination and affects neither accounting nor taxable profit or loss at the time of the transaction.

Deferred income tax asset are recognised to the extent that it is probable that taxable profit will be available against which the deductible temporary differences and the carry forward of unused tax credits and unused tax losses can be utilised.

The carrying amount of deferred income tax assets is reviewed at each reporting date and reduced to the extent that it is no longer probable that sufficient taxable profit will be available to allow all or part of the deferred income tax asset to be utilised.

Deferred tax assets and liabilities are measured using substantively enacted tax rates expected to apply to taxable income in the years in which the temporary differences are expected to be received or settled.

Deferred tax assets and liabilities are offset when they relate to income taxes levied by the same taxation authority and the relevant entity intends to settle its current tax assets and liabilities on a net basis.

Deferred tax assets include Minimum Alternative Tax (MAT) paid in accordance with the tax laws in India, which is likely to give future economic benefits in the form of availability of set off against future income tax liability. Accordingly, MAT is recognised as deferred tax asset in the Balance sheet when the asset can be measured reliably and it is probable that the future economic benefit associated with the asset will be realised.

I) Financial Instruments

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

1. Financial Assets.

i) Initial recognition and measurement:

All financial assets are recognised initially at fair value plus, in the case of financial assets not recorded at fair value through profit or loss, transaction costs that are attributable to the acquisition of the financial asset. Transaction costs of financial assets carried at fair value through profit or loss are expensed in statement of profit or loss. Purchases or sales of financial assets that require delivery of assets within a time frame established by regulation or convention in the market place (regular way trades) are recognised on the trade date, i.e., the date that the Company commits to purchase or sell the asset.

ii) Subsequent measurement: Financial assets at amortised cost

Financial assets are subsequently measured at amortised cost if these financial assets are held within a business whose objective is to hold these assets to collect contractual cash flows and the contractual terms of the financial assets give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.

Financial assets at fair value through other comprehensive income

Financial assets are measured at fair value through other comprehensive income if these financial assets are held within a business whose objective is achieved by both collecting contractual cash flows on specified dates that are solely payments of principal and interest on the principal amount outstanding and financial assets.

The management uses a provision matrix to determine the impairment loss on the portfolio of trade and other receivables. Provision matrix is based on its historically observed expected credit loss rates over the expected life of the trade receivables and is adjusted for forward looking estimates.

Expected credit loss allowance or reversal recognised during the period is recognised as income or expense, as the case may be, in the statement of profit and loss. In case of balance sheet, it is shown as reduction from the specific financial asset.

2.Financial liabilities

Financial assets at fair value through profit or loss

Financial assets are measured at fair value through profit or loss unless it is measured at amortised cost or at fair value through other comprehensive income on initial recognition. The transaction costs directly attributable to the acquisition of financial assets and liabilities at fair value through profit or loss are immediately recognised in profit or loss.

iii. Derecognition:

Afmancial asset or where applicable, a part of a financial asset is primarily derecognised 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 (a) the Company has transferred substantially all the risks and rewards of the asset, or (b) 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.

iv. Impairment of financial assets:

In accordance with Ind AS 109, the Company applies expected credit loss (ECL) model for measurement and recognition of impairment loss on the debt instruments, that are measured at amortised cost e.g., loans, debt securities, deposits and trade receivables.

Expected credit loss 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.

Financial liabilities are measured at amortised cost using the effective interest method.

Equity instruments

An equity instrument is a contract that evidences residual interest in the assets of the company after deducting all of its liabilities. Equity instruments recognised by the Company are recognised at the proceeds received net off direct issue cost.

i) Initial recognition and measurement:

At initial recognition, all financial liabilities are recognised at fair value and in the case of loans, borrowings and payables, net of directly attributable transaction costs.

ii) Subsequent measurement:

a) 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. Gain or losses on liabilities held for trading are recognised in the profit or loss.

b) Financial liabilities at amortised cost:

Amortised cost, in case of financial liabilities with maturity more than one year, is calculated by discounting the future cash flows with effective interest rate. The effective interest rate amortisation is included as finance costs in the Statement of Profit and Loss. Financial liability with maturity of less than one year is shown at transaction value.

iii. Derecognition:

A financial liability is derecognised when the obligation under the liability is discharged or cancelled or expires. The difference between the carrying amount of a financial liability that has been extinguished or transferred to another party and the consideration paid, including any non-cash assets transferred or liabilities assumed, is recognised in profit or loss as other income or finance costs.

m) Cash and cash equivalents

The Company considers all highly liquid financial instruments, which are readily convertible into known amounts of cash that are subject to an insignificant risk of change in value and having original maturities of three months or less from the date of purchase, to be cash equivalents. Cash and cash equivalents consist of balances with banks which are unrestricted for withdrawal and usage.

n) Financial Guarantee Contracts:

A financial guarantee contract is a contract that requires the issuer to make specified payments to reimburse the holder for a loss it incurs because a specified debtor fails to make payment when due in accordance with original or modified terms of a debt instrument.

The Company measures any financial guarantee on initial recognition at their fair value.

Subsequently these contracts are measured at the higher of:

a. the amount of the loss allowance determined as per impairment requirements of Ind AS 109, and

b. the amount initially recognised, less where appropriate, cumulative amount of income reconised in accordance with the principles of Ind AS 18.

o) Fair Value Measurement:

The Company measures financial instruments 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 such asset or liability, or in the absence of a principal market, in the most advantageous market which is accessible to 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 categorized 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:

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

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

c. Level 3-Valuation techniques for which the lowest level in put that is significant to the fair value measurement is unobservable.

p) Investment in subsidiaries

Investment in subsidiaries are measured at cost less impairment.

q) Property, plant and equipment

Property, plant and equipment are stated at cost net of input tax credits, less accumulated depreciation and accumulated impairment losses, if any. Cost comprises the purchase price and all attributable cost, to bring the asset to its working condition for its intended use. Borrowing costs relating to acquisition of property, plant and equipment which take substantial period of time to get ready for its intended use are also included to the extent they relate to the period till such assets are ready to put to use.

The Company adopted cost model as its accounting policy, in recognition of the property, plant and equipment and recognises transaction value as the cost.

An item of Property, Plant and Equipment is derecognised upon disposal or when no future economic benefits are expected from its use. Any gain or loss arising on derecognition of the asset (calculated as the difference between the net disposal proceeds and the carrying amount of the asset) is recognised in the Statement of Profit and Loss. Property, Plant and Equipment which are found to be not usable or retired from active use or when no further benefits are expected from their use are removed from property, plant and equipment and the carrying amount net of scrap value, if any is charged to Statement of Profit and Loss.

The improvements/modifications carried on the lease hold land/ property are recognised as lease hold improvements and are written off over the primary lease period or the life of such improvement whichever is lower.

The estimated useful lives are as mentioned below:

Type of asset	Method	Useful lives
Computer equipment	Straight line	3 years
Office equipments	Straight line	5 years
Furniture and fixtures	Straight line	10 years
Electrical installations	Straight line	10 years
Vehicles	Straight line	8 years

r) Intangible assets

Intangible assets purchased are measured at cost as of the date of acquisition, as applicable, less accumulated amortisation and accumulated impairment, if any. Intangible assets consist of rights under licensing agreement and software licences which are amortised over license period which equates the useful life ranging between 5-6 years on a straight line basis.

s) Impairment of Non-financial assets

i)The carrying amounts of assets are reviewed at each balance sheet date if there is any indication of impairment based on internal/ external factors. An impairment loss is recognized wherever the carrying amount of an asset exceeds its recoverable amount. The recoverable amount is the greater of the asset''s net selling price and value in use. I n assessing value in use, the estimated future cash flows are discounted to their present value at the weighted average cost of capital. After impairment, depreciation is provided on the revised carrying amount of the asset over its remaining useful life.

ii.Reversal of impairment losses recognised in prior years is recorded when there is an indication that the impairment losses recognised for the asset are no longer existing or have decreased.

t) Employee benefits

i) Defined benefit plans

For defined benefit plans, the cost of providing benefits is determined using the Projected Unit Credit Method, with actuarial valuations being carried out at each Balance sheet date. Actuarial gains and losses are recognised in full in the other comprehensive income for the period in which they occur. Past service cost both vested and unvested is recognised as an expense at the earlier of (a) when the plan amendment or curtailment occurs; and (b) when the entity recognises related restructuring costs or termination benefits. The retirement benefit obligations recognised in the Balance sheet represents the present value of the defined benefit obligations reduced by the fair value of scheme assets. Any asset resulting from this calculation is limited to the present value of available refunds and deductions in future contributions to the scheme.

ii) Defined contribution plans

Employer''s contribution to provident fund/employee state insurance which is in the nature of defined contribution scheme is expensed off when the contributions to the respective funds are due. There are no other obligations other than the contribution payable to the fund.

iii) Compensated absences

Compensated absences which are not expected to occur with in twelve months after the end of the period in which the employee renders the related services are recognised as an actuarially determined liability at the present value of the defined benefit obligation at the Balance sheet date.

u) Earnings per share

Basic earnings per share are computed by dividing profit or loss attributable to equity shareholders of the Company by the weighted average number of equity shares outstanding during the year. The Company did not have any potentially dilutive securities in any of the years presented.

v) Borrowing Costs:

Borrowing costs directly attributable to the acquisition, construction or production of an asset that necessarily takes a substantial period of time to get ready for its intended use or sale are capitalised as part of the cost of the asset. All other borrowing costs are expensed in the

period in which they occur. Borrowing costs consist of interest and other costs that an entity incurs in connection with the borrowing of funds. Borrowing cost also includes exchange differences to the extent regarded as an adjustment to the borrowing costs.

w) Segment Reporting:

Operating segments are reported in a manner consistent with the internal reporting provided to the Chief operating decision maker ("CODM").

The board of directors of the company has identified the Chairman and Hanging Director as the CODM.

x) Provisions:

Provisions are recognised when there is a present legal or constructive obligation that can be estimated reliably, as a result of a past event, when it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and a reliable estimate can be made of the amount of the obligation. Provisions are not recognised for future operating losses. Any reimbursement that the Company can be virtually certain to collect from a third party with respect to the obligation is recognised as a separate asset. However, this asset may not exceed the amount of the related provision.

y) Contingencies:

Where it is not probable that an inflow or an outflow of economic resources will be required, or the amount cannot be estimated reliably, the asset or the obligation is not recognised in the statement of balance sheet and is disclosed as a contingent asset or contingent liability. Possible outcomes on obligations/ rights, whose existence will only be confirmed by the occurrence or non-occurrence of one or more future events are also disclosed as contingent assets or contingent liabilities.

z) Prior period items:

In case prior period adjustments are material in nature the Company prepares the restated financial statement as required under Ind AS 8 - "Accounting Policies, Changes in Accounting Estimates and Errors". Immaterial items pertaining to prior periods are shown under respective items in the Statement of Profit and Loss.

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Mar 31, 2016

Company Overview:

Lycos Internet Limited (Formerly known as Ybrant Digital limited), offers digital marketing solutions to businesses, agencies and online publishers worldwide. Lycos Internet Limited connects Advertisers with their Audience across any form of Digital Media, using its massive local presence to deliver appropriate messages to the right audience, through the most relevant Digital channels. Lycos Internet Limited has a global presence, with offices in over 24 countries.

Lycos Internet Limited is also a Global Information Technology Implementation and Outsourcing Services Provider with an exceptional track record of providing high quality, on-budget, and on-time solutions to demanding clients. Our business knowledge in key verticals helps us provide solutions that are customized to address the specific needs while focusing on maximizing value of Information Technology investments such that clients can achieve their business objectives. We believe in fostering long-term relationships, and partner with our clients in their success. Lycos Provides End-to-end Enterprise Solution Offerings and Specializing in ERP Solutions, Microsoft and Open Source Systems development.

Basis of Preparation:

The financial statements of the company have been prepared in accordance with the Generally Accepted Accounting Principles in India (Indian GAAP) to comply with the Accounting standards specified under section 133 of the Companies Act,2013, read with Rule 7 of the Companies (Accounts) Rules, 2014 and the relevant provisions of the Companies Act, 2013 (“the 2013 Act”), as applicable. The financial statements have been prepared as a going concern on accrual basis under the historical cost convention. The Accounting policies adopted in the preparation of the financial statements are consistent with those followed in the previous year except for change in the accounting policy for depreciation

Use of Estimates:

The preparation of financial statements is in conformity with generally accepted accounting principles require the management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities at the date of the financial statements and the result of operations during the reporting period.

Although these estimates are based upon management’s best knowledge of current events and actions, actual results could differ from these estimates. Significant estimates used by the management in the preparation of these financial statements include estimates of the economic useful lives of fixed assets and provisions for bad and doubtful debts. Any revision to accounting estimates is recognized prospectively.

1. Revenue Recognition :

a) Digital Marketing Services:

i) The Contracts between the Company and its Customers are either time or material contracts or fixed price contracts.

ii) Revenue from fixed price contracts is recognized according to the milestones achieved as specified in the contracts on the proportionate-completion method based on the work completed. Any anticipated losses expected upon the contract completion are recognized immediately. Changes in job performance, conditions and estimated profitability may result in revisions and corresponding revenues and costs are recognized in the period in which such changes are identified. Deferred revenue represents amounts billed in excess of revenue earned for which related services are expected to be performed in the next operating cycle.

iii) In respect of time and material contract, revenue is recognized in the period in which the services are provided.

iv) Revenue from product sale and licensing arrangements are recognized on delivery and installation.

b) Software Development:

i) Income from software development is accounted for on the basis of Software developed and billed to clients on acceptance and/or on the basis of man days/man hours as per the terms of contract.

ii) Revenue from professional services consist primarily of revenue earned from services performed on a ''time and material'' basis. The related revenue is recognized as and when the services are performed.

iii) Revenue from software development services includes revenue from time and material and fixed price contracts are recognized as related services are performed.

iv) Revenue on fixed price contracts is recognized in accordance with percentage of completion and method of account.

v) Revenue is not recognized on the grounds of prudence, until realized in respect of liquidated damages, delayed payments as recovery of the amounts are not certain.

2. Foreign Exchange Transaction :

Realized gains & loss in foreign exchange transactions are recognized in Profit & Loss Account. Transactions in foreign currency will be recorded at the rates of exchange prevailing on the date of the transaction. Monetary assets and liabilities denominated in foreign currency will be translated at the rate of exchange as at Balance Sheet date and resultant gain or loss is recognized in the profit and loss account. Non-Monetary assets and liabilities are translated at the rate prevailing on the date of transaction and foreign exchange fluctuation gain or loss arised on account of translation of non-Monetary items like long term loans and advances are accumulated in a reserve account.

Revenue, expense and cash flow items denominated in foreign currency are translated into the relevant functional currencies using the exchange rate in effect on the date of transaction.

3. Investments :

Investments are either classified as current or long term, based on the management’s intention at the time of purchase. Current investments are carried at the lower of cost and fair value. Cost for overseas investments comprises the Indian Rupee value of the consideration paid for the investment translated at the exchange rate prevalent at the date of investment. Long term investments are carried at cost and provisions recorded to recognize any decline, other than temporary, in the value of each investment.

4. Fixed Assets :

Tangible assets

Tangible assets are stated at actual cost less accumulated depreciation and accumulated impairment losses. The actual cost capitalized includes material cost, freight, installation cost, duties and taxes, finance charges and other incidental expenses incurred during the construction/installation stage.

Intangible assets

Intangible assets are recorded at consideration paid for acquisition and other direct costs that can be directly attributed, or allocated on a reasonable and consistent basis, to creating, producing and making the asset ready for its intended use.

5. Depreciation and Amortization :

Depreciation is provided on straight line method on pro-rata basis and at the rates and manner specified in the Schedule II of the Companies Act, 2013 and there is no change in the method of Depreciation during the year.

Preliminary Expenses are amortized over the period of 5 years.

6. Taxation :

The current charge for income tax is calculated in accordance with the relevant tax regulations applicable to the Company. Deferred tax asset and liability is recognized for future tax consequences attributable to the timing differences that result between the profit offered for income tax and the profit as per the financial statements. Deferred tax asset & liability are measured as per the tax rates/laws that have been enacted or substantively enacted by the Balance Sheet date.

Minimum Alternate Tax (MAT) paid in accordance with the tax laws, which gives rise to future economic benefits in the form of adjustments of future income tax liability, is considered as an asset if there is convincing evidence that the company will pay normal tax after the tax holiday period. Accordingly, it is recognized as an asset in the balance sheet when it is probable that the future economic benefit associated with it will flow to the company and asset can be measured reliably.

7. Earnings Per Share:

The earnings considered in ascertaining the companies earning per share comprise net profit after tax and includes the post-tax effect of any extra-ordinary/exceptional item is considered. The number of shares used in computing basic earnings per share is the weighted average number of shares outstanding during the year.

The no. of shares used in computing diluted earnings per share comprises the weighted average no. of shares considered for deriving basic earnings per share and also the weighted average no. of equity shares that could have been issued on the conversion of all dilutive potential equity shares.

8. Gratuity and Leave Encashment :

In accordance with the Payment of Gratuity Act, 1972, the company provides for gratuity, a defined benefit retirement plan covering eligible employees of the company. The Gratuity provides a lump-sum payment to vested employees at retirement, death, incapacitation or termination of employment, of an amount based on the respective employee’s salary and the tenure of the employment with the group. The company has a made a provision for gratuity to its employees on the basis of independent actuarial valuation, in accordance with AS-15. The actuarial liability is determined with reference to employees at the end of each financial year.

The provision for Leave Encashment is calculated as per accrual method.

9. Borrowing Cost :

Borrowing cost relating to acquisition/ construction of qualifying assets are capitalized until the time all substantial activities necessary to prepare the qualifying assets for their intended use are complete. A qualifying asset is one that necessarily takes substantial period of time to get ready for its intended use/sale. Borrowing cost that is attributable to the projects is charged to the respective projects. All other borrowing costs, not eligible for inventorisation/capitalisation, are charged to revenue.

10. Cash Flow Statement :

The Company has prepared Cash Flow Statement as per the AS-3.

Cash flows are reported using the Indirect method, whereby net profit before tax is adjusted for the effects of transactions of a non cash nature, any deferrals or accruals of past or future operating cash receipts or payments and item of income or expenses associated with investing or financing cash flows. The cash flows from operating, investing and financing activities of the group are segregated.

11. Provisions, Contingent Liabilities and Contingent Assets :

Provisions are recognized for liabilities that can be measured only by using a substantial degree of estimation, if

a) The Company has a present obligation as a result of a past event;

b) A probable outflow of resources is expected to settle the obligation; and

c) The amount of the obligation can be reliably estimated.

Reimbursement expected in respect of expenditure required to settle a provision is recognized only when it is virtually certain that the reimbursement will be received.

Contingent Liability is disclosed in the case of:

a) A present obligation arising from a past event, when it is not probable that an outflow of resources will be required to settle the obligation;

b) A possible obligation, unless the probability of outflow of resources is remote. Contingent Assets are neither recognized nor disclosed.

12. Impairment of Assets:

Management periodically assesses using external and internal sources whether there is an indication that an asset may be impaired. Impairment occurs where the carrying value exceeds the present value of future cash flows expected to arise from the continuing use of the asset and its eventual disposal. The impairment loss to be expensed is determined as the excess of the carrying amount over the higher of the asset’s net sale price or present value as determined above.

13. Related Party Disclosures :

The Company furnishes the details of Related Party Disclosures as given in Para 23 and 26 as required by AS-18.

14. Lease Rentals Operating Lease:

Leases where the lessor retains substantially all the risks and rewards of ownership are classified as operating leases. The company charges Lease rentals in respect of assets taken under operating leases to profit and loss account on a straight line basis over the lease term.

Finance Lease:

A Finance lease is a lease that transfers substantially all the risks and rewards incidental to the ownership of an asset.

15. Claims:

Claims made by the company are recognized to the extent the Company deems them recoverable. Claims against the Company, including liquidated damages, are recognized only on acceptance basis. Claims which are contingent in nature are not recognized in the books but are disclosed separately in the Notes to accounts. Contingent assets are neither recognized nor disclosed in the financial statements.

---

Mar 31, 2015

Company Overview:

Lycos Internet Limited (Formerly known as Ybrant Digital limited), offers digital marketing solutions to businesses, agencies and online publishers worldwide. Lycos Internet Limited connects Advertisers with their Audience across any form of Digital Media, using its massive local presence to deliver appropriate messages to the right audience, through the most relevant Digital channels. Lycos Internet Limited has a global presence, with offices in over 24 countries.

Lycos Internet Limited is also a Global Information Technology Implementation and Outsourcing Services Provider with an exceptional track record of providing high quality, on-budget, and on-time solutions to demanding clients. Our business knowledge in key verticals helps us provide solutions that are customized to address the specific needs while focusing on maximizing value of Information Technology investments such that clients can achieve their business objectives. We believe in fostering long-term relationships, and partner with our clients in their success. Lycos Provides End-to-end Enterprise Solution Offerings and Specializing in ERP Solutions, Microsoft and Open Source Systems development.

Basis of Preparation:

The financial statements of the company have been prepared in accordance with the Generally Accepted Accounting Principles in India (Indian GAAP) to comply with the Accounting standards specified under section 133of the Companies Act,2013, read with Rule 7 of the Companies (Accounts) Rules, 2014 and the relevant provisions of the Companies Act, 2013 ("the 2013 Act"), as applicable. The financial statements have been prepared as a going concern on accrual basis under the historical cost convention. The Accounting policies adopted in the preparation of the financial statements are consistent with those followed in the previous year except for change in the accounting policy for depreciation

Use of Estimates:

The preparation of financial statements is in conformity with generally accepted accounting principles require the management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities at the date of the financial statements and the result of operations during the reporting period.

Although these estimates are based upon management's best knowledge of current events and actions, actual results could differ from these estimates. Significant estimates used by the management in the preparation of these financial statements include estimates of the economic useful lives of fixed assets and provisions for bad and doubtful debts. Any revision to accounting estimates is recognized prospectively.

1. Revenue Recognition :

a) Digital Marketing Services:

I) The Contracts between the Company and its Customers are either time or material contracts or fixed price contracts.

ii) Revenue from fixed price contracts is recognized according to the milestones achieved as specified in the contracts on the proportionate-completion method based on the work completed. Any anticipated losses expected upon the contract completion are recognized immediately. Changes in job performance, conditions and estimated profitability may result in revisions and corresponding revenues and costs are recognized in the period in which such changes are identified. Deferred revenue represents amounts billed in excess of revenue earned for which related services are expected to be performed in the next operating cycle.

iii) In respect of time and material contract, revenue is recognized in the period in which the services are provided.

iv) Revenue from product sale and licensing arrangements are recognized on delivery and installation.

b) Software Development:

i) Income from software development is accounted for on the basis of Software developed and billed to clients on acceptance and/or on the basis of man days/man hours as per the terms of contract.

ii) Revenue from professional services consist primarily of revenue earned from services performed on a 'time and material' basis. The related revenue is recognized as and when the services are performed.

iii) Revenue from software development services includes revenue from time and material and fixed price contracts are recognized as related services are performed.

iv) Revenue on fixed price contracts is recognized in accordance with percentage of completion and method of account.

v) Revenue is not recognized on the grounds of prudence, until realized in respect of liquidated damages, delayed payments as recovery of the amounts are not certain.

2. Foreign Exchange Transaction :

Realized gains & loss in foreign exchange transactions are recognized in Profit & Loss Account.

Transactions in foreign currency will be recorded at the rates of exchange prevailing on the date of the transaction. Monetary assets and liabilities denominated in foreign currency will be translated at the rate of exchange as at Balance Sheet date and resultant gain or loss is recognized in the profit and loss account. Non- Monetaryassets and liabilities are translated at the rate prevailing on the date of transaction and foreign exchange fluctuation gain or loss arised on account of translation of non-Monetaryitems like long term loans and advances are accumulated in a reserve account.

Revenue, expense and cash flow items denominated in foreign currency are translated into the relevant functional currencies using the exchange rate in effect on the date of transaction.

3. Investments :

Investments are either classified as current or long term, based on the management's intention at the time of purchase. Current investments are carried at the lower of cost and fair value. Cost for overseas investments comprises the Indian Rupee value of the consideration paid for the investment translated at the exchange rate prevalent at the date of investment. Long term investments are carried at cost and provisions recorded to recognize any decline, other than temporary, in the value of each investment.

4. Fixed Assets :

Tangible assets

Tangible assets are stated at actual cost less accumulated depreciation and accumulated impairment losses. The actual cost capitalized includes material cost, freight, installation cost, duties and taxes, finance charges and other incidental expenses incurred during the construction/installation stage.

Intangible assets

Intangible assets are recorded at consideration paid for acquisition and other direct costs that can be directly attributed, or allocated on a reasonable and consistent basis, to creating, producing and making the asset ready for its intended use.

5. Depreciation and Amortization :

Depreciation is provided on straight line method on pro-rata basis and at the rates and manner specified in the Schedule II of the Companies Act, 2013 and there is no change in the method of Depreciation during the year.

Preliminary Expenses are amortized over the period of 5 years.

6. Taxation :

The current charge for income tax is calculated in accordance with the relevant tax regulations applicable to the Company. Deferred tax asset and liability is recognized for future tax consequences attributable to the timing differencesthat result between the profit offered for income tax and the profit as per the financial statements. Deferred tax asset & liability are measured as per the tax rates/laws that have been enacted or substantively enacted by the Balance Sheet date.

Minimum Alternate Tax (MAT) paid in accordance with the tax laws, which gives rise to future economic benefits in the form of adjustments of future income tax liability, is considered as an asset if there is convincing evidence that the company will pay normal tax after the tax holiday period. Accordingly, it is recognized as an asset in the balance sheet when it is probable that the future economic benefit associated with it will flow to the company and asset can be measured reliably.

7. Earnings Per Share:

The earnings considered in ascertaining the companies earning per share comprise netprofit after taxand includes the post tax effect of any extra-ordinary/exceptional item is considered. The number of shares used in computing basic earnings per share is the weighted average number of shares outstanding during the year.

The no. of shares used in computing diluted earnings per share comprises the weighted average no. of shares considered for deriving basic earnings per share and also the weighted average no. of equity shares that could have been issued on the conversion of all dilutive potential equity shares.

8. Gratuity and Leave Encashment :

In accordance with the Payment of Gratuity Act,1972, the company provides for gratuity, a defined benefit retirement plan covering eligible employees of the company. The Gratuity provides a lump-sum payment to vested employees at retirement, death, incapacitation or termination of employment, of an amount based on the respective employee's salary and the tenure of the employment with the group. The company has a made a provision for gratuity to its employees on the basis of independent actuarial valuation, in accordance with AS-15. The actuarial liability is determined with reference to employees at the end of each financial year.

The provision for Leave Encashment is calculated as per accrual method.

9. Borrowing Cost :

Borrowing cost relating to acquisition/ construction of qualifying assets are capitalized until the time all substantial activities necessary to prepare the qualifying assets for their intended use are complete. A qualifying asset is one that necessarily takes substantial period of time to get ready for its intended use/sale. Borrowing cost that is attributable to the projects is charged to the respective projects. All other borrowing costs, not eligible for inventorisation/capitalisation, are charged to revenue

10. Cash Flow Statement :

The Company has prepared Cash Flow Statement as per the AS-3. Cash flows are reported using the Indirect method, whereby net profit before tax is adjusted for the effects of transactions of a non cash nature, any deferrals or accruals of past or future operating cash receipts or payments and item of income or expenses associated with investing or financing cash flows. The cash flows from operating, investing and financing activities of the group are segregated.

11. Provisions, Contingent Liabilities and Contingent Assets :

Provisions are recognized for liabilities that can be measured only by using a substantial degree of estimation, if

a) The Company has a present obligation as a result of a past event;

b) A probable outflow of resources is expected to settle the obligation; and

c) The amount of the obligation can be reliably estimated. Reimbursement expected in respect of expenditure required to settle a provision is recognized only when it is virtually certain that the reimbursement will be received

Contingent Liability is disclosed in the case of:

a) A present obligation arising from a past event, when it is not probable that an outflow of resources will be required to settle the obligation;

b) A possible obligation, unless the probability of outflow of resources is remote. Contingent Assets are neither recognized nor disclosed.

12. Impairment of Assets:

Management periodically assesses using external and internal sources whether there is an indication that an asset may be impaired. Impairment occurs where the carrying value exceeds the present value of future cash flows expected to arise from the continuing use of the asset and its eventual disposal. The impairment loss to be expensed is determined as the excess of the carrying amount over the higher of the asset's net sale price or present value as determined above.

13. Related Party Disclosures :

The Company furnishes the details of Related Party Disclosures as given in Para 23 and 26 as required by AS-18

14. Lease Rentals

Operating Lease:

Leases where the lessor retains substantially all the risks and rewards of ownership are classified as operating leases. The company charges Lease rentals in respect of assets taken under operating leases to profit and loss account on a straight line basis over the lease term.

Finance Lease:

A Finance lease is a lease that transfers substantially all the risks and rewards incidental to the ownership of an asset.

15. Claims:

Claims made by the company are recognized to the extent the Company deems them recoverable. Claims against the Company, including liquidated damages, are recognized only on acceptance basis. Claims which are contingent in nature are not recognized in the books but are disclosed separately in the Notes to accounts. Contingent assets are neither recognized nor disclosed in the financial statements.

---

Mar 31, 2014

Company Overview

Ybrant Digital Limited, offers digital marketing solutions to businesses, agencies and online publishers worldwide. Ybrant Digital connects Advertisers with their Audience across any form of Digital Media, using its massive local presence to deliver appropriate messages to the right audience, through the most relevant Digital channels. Ybrant Digital has a global presence, with offices in over 20 countries.

Ybrant Digital Limited is also a Global Information Technology Implementation and Outsourcing Services Provider with an exceptional track record of providing high quality, on-budget, and on-time solutions to demanding clients. Our business knowledge in key verticals helps us provide solutions that are customized to address the specific needs while focusing on maximizing value of Information Technology investments such that clients can achieve their business objectives. We believe in fostering long-term relationships, and partner with our clients in their success. Ybrant Provides End-to-end Enterprise Solution Offerings and Specialising in ERP Solutions, Microsoft and Open Source Systems development.

Basis of Preparation:

The financial statements have been prepared to comply in all material respects with the accounting standards notified by Companies Accounting Standards Rules, 2006 and the relevant provisions of the Companies Act, 1956 (''the Act''). The financial statements have been prepared under historical cost convention on an accrual basis in accordance with accounting principles generally accepted in India. The accounting policies have been consistently applied by the Company and are consistent with those used in the previous year:

Use of Estimates:

The preparation of financial statements is in conformity with generally accepted accounting principles require the management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities at the date of the financial statements and the result of operations during the reporting period. Although these estimates are based upon management''s best knowledge of current events and actions, actual results could differ from these estimates. Significant estimates used by the management in the preparation of these financial statements include estimates of the economic useful lives of fixed assets and provisions for bad and doubtful debts. Any revision to accounting estimates is recognized prospectively.

1. Revenue Recognition :

a) Software Development:

i) Income from software development is accounted for on the basis of Software developed and billed to clients on acceptance and/or on the basis of man days/man hours as per the terms of contract.

ii) Revenue from professional services consist primarily of revenue earned from services performed on a ''time and material'' basis. The related revenue is recognised as and when the services are performed.

iii) Revenue from software development services includes revenue from time and material and fixed price contracts are recognised as related services are performed.

iv) Revenue on fixed price contracts is recognised in accordance with percentage of completion and method of account.

v) Revenue is not recognised on the grounds of prudence, until realised in respect of liquidated damages, delayed payments as recovery of the amounts are not certain.

b) Digital Marketing Services:

i) The Contracts between the Company and its Customers are either time or material contracts or fixed price contracts.

ii) Revenue from fixed price contracts is recognized according to the milestones achieved as specified in the contracts on the propor- tionate-completion method based on the work completed. Any anticipated losses expected upon the contract completion are recognized immediately. Changes in job performance, conditions and estimated profitability may result in revisions and correspond- ing revenues and costs are recognized in the period in which such changes are identified. Deferred revenue represents amounts billed in excess of revenue earned for which related services are expected to be performed in the next operating cycle.

iii) In respect of time and material contract, revenue is recognized in the period in which the services are provided.

iv) Revenue from product sale and licensing arrangements are recognized on delivery and installation.

2. Foreign Exchange Transaction :

Realised gains & loss in foreign exchange transactions are recognised in Profit & Loss Account.

Transactions in foreign currency will be recorded at the rates of exchange prevailing on the date of the transaction. Monitory assets and liabilities denominated in foreign currency will be translated at the rate of exchange as at Balance Sheet date and resultant gain or loss is recognized in the profit and loss account. Non monitory assets and liabilities are translated at the rate prevailing on the date of transaction and foreign exchange fluctuation gain or loss arised on account of translation of non monitory items like long term loans and advances are accumulated in a reserve account (FCMITDA).

Revenue, expense and cash flow items denominated in foreign cur- rencies are translated into the relevant functional currencies using the exchange rate in effect on the date of transaction.

3. Investments :

Investments are either classified as current or long term, based on the management''s intention at the time of purchase. Current investments are carried at the lower of cost and fair value. Cost for overseas investments comprises the Indian Rupee value of the consideration paid for the investment translated at the exchange rate prevalent at the date of investment. Long term investments are carried at cost and provisions recorded to recognize any decline, other than temporary, in the value of each investment.

4. Fixed Assets :

Tangible assets

Tangible assets are stated at actual cost less accumulated depreciation. The actual cost capitalized includes material cost, freight, installation cost, duties and taxes, finance charges and other incidental expenses incurred during the construction/installation stage.

Intangible assets

Intangible assets are recorded at consideration paid for acquisition and other direct costs that can be directly attributed, or allocated on a reasonable and consistent basis, to creating, producing and making the asset ready for its intended use.

5. Depreciation and Amortization :

Depreciation is provided on straight line method on prorata basis and at the rates and manner specified in the Schedule XIV of the Companies Act, 1956 and there is no change in the method of Depreciation during the year. Individual assets acquired for less than Rs. 5,000 are entirely depreciated in the year of acquisition. Preliminary Expenses are amortised over the period of 5 years.

6. Taxation :

The current charge for income tax is calculated in accordance with the relevant tax regulations applicable to the Company. Deferred tax asset and liability is recognised for future tax consequences attributable to the timing differences that result between the profit offered for income tax and the profit as per the financial statements. Deferred tax asset & liability are measured as per the tax rates/laws that have been enacted or substantively enacted by the Balance Sheet date.

Minimum Alternate Tax (MAT) paid in accordance with the tax laws, which gives rise to future economic benefits in the form of adjustments of future income tax liability, is considered as an asset if there is convincing evidence that the company will pay normal tax after the tax holiday period. Accordingly, it is recognized as an asset in the balance sheet when it is probable that the future economic benefit associated with it will flow to the company and asset can be measured reliably.

7. Earnings Per Share:

The earnings considered in ascertaining the companies earning per share comprise net profit after tax and includes the post tax effect of any extra-ordinary/exceptional item is considered. The number of shares used in computing basic earnings per share is the weighted average number of shares outstanding during the year.

The no. of shares used in computing diluted earnings per share comprises the weighted average no. of shares considered for deriving basic earnings per share and also the weighted average no. of equity shares that could have been issued on the conversion of all dilutive potential equity shares.

8. Gratuity and Leave Encashment :

In accordance with the Payment of Gratuity Act, 1972, the company provides for gratuity, a defined benefit retirement plan covering eligible employees of the company. The Gratuity provides a lump-sum payment to vested employees at retirement, death, incapacitation or termination of employment, of an amount based on the respective employee''s salary and the tenure of the employment with the group. The company has a made a provision for gratuity to its employees on the basis of independent actuarial valuation, in accordance with AS-15. The actuarial liability is determined with reference to employees at the end of each financial year.

The provision for Leave Encashment is calculated as per accrual method.

9. Borrowing Cost :

Borrowing cost relating to acquisition/ construction of qualifying assets are capitalized until the time all substantial activities necessary to prepare the qualifying assets for their intended use are complete. A qualifying asset is one that necessarily takes substantial period of time to get ready for its intended use/sale. Borrowing cost that is attributable to the projects is charged to the respective projects. All other borrowing costs, not eligible for inventorisation/ capitalisation, are charged to revenue.

10. Cash Flow Statement :

The Company has prepared Cash Flow Statement as per the AS-3. Cash flows are reported using the Indirect method, whereby net profit before tax is adjusted for the effects of transactions of a non cash nature, any deferrals or accruals of past or future operating cash receipts or payments and item of income or expenses associated with investing or financing cash flows. The cash flows from operating, investing and financing activities of the group are segregated.

11. Provisions, Contingent Liabilities and Contingent Assets :

Provisions are recognized for liabilities that can be measured only by using a substantial degree of estimation, if

a) The Company has a present obligation as a result of a past event;

b) A probable outflow of resources is expected to settle the obligation; and

c) The amount of the obligation can be reliably estimated.

Reimbursement expected in respect of expenditure required to settle a provision is recognized only when it is virtually certain that the reimbursement will be received.

Contingent Liability is disclosed in the case of:

a) A present obligation arising from a past event, when it is not probable that an outflow of resources will be required to settle the obligation;

b) A possible obligation, unless the probability of outflow of resources is remote. Contingent Assets are neither recognized nor disclosed.

12. Impairment of Assets:

Management periodically assesses using external and internal sources whether there is an indication that an asset may be impaired. Impairment occurs where the carrying value exceeds the present value of future cash flows expected to arise from the continuing use of the asset and its eventual disposal. The impairment loss to be expensed is determined as the excess of the carrying amount over the higher of the asset''s net sale price or present value as determined above.

13. Related Party Disclosures :

The Company furnishes the details of Related Party Disclosures as given in Para 23 and 26 as required by AS-18.

14. Lease Rentals

Operating Lease :

Leases where the lessor retains substantially all the risks and rewards of ownership are classified as operating leases. The company charges Lease rentals in respect of assets taken under operating leases to profit and loss account on a straight line basis over the lease term.

Finance Lease:

A Finance lease is a lease that transfers substantially all the risks and rewards incidental to the ownership of an asset.

15. Claims:

Claims made by the company are recognized to the extent the Company deems them recoverable. Claims against the Company, including liquidated damages, are recognized only on acceptance basis. Claims which are contingent in nature are not recognized in the books but are disclosed separately in the Notes to accounts. Contingent assets are neither recognized nor disclosed in the financial statements.

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Mar 31, 2013

1. Revenue Recognition :

a) Software Development:

(i) Income from software development is accounted for on the basis of Software developed and billed to clients on acceptance and/or on the basis of man days/man hours as per the terms of contract.

(ii) Revenue from professional services consist primarily of revenue earned from services performed on a ''time and material'' basis. The related revenue is recognised as and when the sen-ices are performed.

(iii) Revenue from software development services includes revenue from time and material and fixed price contracts are recognised as related services are performed.

(iv) Revenue on fixed price contracts is recognised in accordance with percentage of completion and method of account.

(v) Revenue is not recognised on the grounds of prudence, until realised in respect of liquidated damages, delayed payments as recover)- of the amounts are not certain.

b) Digital Marketing Services:

(i) The Contracts between the Company and its Customers are cither time or material contracts or fixed price contracts.

(ii) Revenue from fixed price contracts is recognized according to the milestones achieved as specified in the contracts on the proportionate-completion method based on the work completed. Any anticipated losses expected upon the contract completion are recognized immediately. Changes in job performance, conditions and estimated profitability mav result in revisions and corresponding revenues and costs are recognized in the period in which such changes are identified. Deferred revenue represents amounts billed in excess of revenue earned for which related services are expected to be performed in the next operating cycle.

(m) In respect of time and material contract, revenue is recognized in the period in which the services are provided.

(iv)

Revenue from product sale and licensing arrangements arc recognized on deliver)'' and installation.

2. Foreign Exchange Transaction :

Realised gains & loss in foreign exchange transactions are recognised in Profit & Loss Account.

Transactions in foreign currency will be recorded at the rates of exchange prevailing on the date of the transaction. Monitory assets and liabilities denominated in foreign currency will be translated at the rate of exchange as at Balance Sheet date and resultant gain or loss is recognized in the profit and loss account. Non monitor)'' assets and liabilities are translated at the rate prevailing on the date of transaction and foreign exchange fluctuation gain or loss ariscd on account of translation of non monitory items like long term loans and advances arc accumulated in a reserve account (FCMITDA).

Revenue, expense and cash flow items denominated in foreign currencies are translated into the relevant functional currencies using the exchange rate in effect on the date of transaction.

3. Investments :

Investments arc cither classified as current or long term, based on the management''s intention at the time of purchase. Current investments are carried at the lower of cost and fair value. Cost for overseas investments comprises the Indian Rupee value of the consideration paid for the investment translated at the exchange rate prevalent at the date of investment. Long term investments are carried at cost and provisions recorded to recognize any decline, other than temporary, in the value of each investment.

4. Fixed Assets :

Tangible assets

Tangible assets are stated at actual cost less accumulated depreciation. The actual cost capitalized includes material cost, freight, installation cost, duties and taxes, finance charges and other incidental expenses incurred during the construction/installation stage.

Intangible assets

Intangible assets arc recorded at consideration paid for acquisition and other direct costs that can be directly attributed, or allocated on a reasonable and consistent basis, to creating, producing and making the asset ready for its intended use.

5. Depreciation and Amortization :

Depreciation is provided on straight line method on pro-rata basis and at the rates and manner specified in the Schedule XIV of the Companies Act, 1956 and there is no change in the method of Depreciation during the year. Individual assets acquired for less than Rs. 5,000 are entirely depreciated in the year of acquisition.

6. Taxation:

The current charge for income tax is calculated in accordance with the relevant tax regulations applicable to the Company.

with the relevant tax regulations applicable to the Company. Deferred tax asset and liability is recognised for future tax consequences attributable to the timing differences that result between the profit offered for income tax and the profit as per the financial statements. Deferred tax asset & liability arc measured as per die tax rates/laws that have been enacted or substantively enacted by the Balance Sheet date.

Minimum Alternate Tax (MAT) paid in accordance with the tax laws, which gives rise to future economic benefits in the form of adjustments of future income tax liability, is considered as an asset if there is convincing evidence that the company will pay normal tax after the tax holiday period. Accordingly, it is recognized as an asset in the balance sheet when it is probable that the future economic benefit associated with it will flow to the company and asset can be measured reliably.

7.

Earnings Per Share:

The earnings considered in ascertaining the companies earning per share comprise net profit after tax and includes the post tax effect of any extra-ordinary/exceptional item is considered. The number of shares used in computing basic earnings per share is the weighted average number of shares outstanding during rhc year.

The no. of shares used in computing diluted earnings per share comprises the weighted average no. of shares considered for deriving basic earnings per share and also the weighted average no. of equity shares that could have been issued on the conversion of all dilutive potential equity shares.

8.

Gratuity and Leave Encashment:

In accordance with the Payment of Gratuity Act, 1972, the company provides for gratuity, a defined benefit retirement plan covering eligible employees of the company. The Gratuity provides a lump-sum payment to vested employees at retirement, death, incapacitation or termination of employment, of an amount based on the respective employee''s salary and the tenure of the employment with the group. The company has a made a provision for gratuity to its employees on the basis of independent actuarial valuation, in accordance with AS-15. The actuarial liability is determined with reference to employees at the end of each financial year.

The provision for Leave Encashment is calculated as per accrual method.

9.

Borrowing Cost:

Borrowing cost relating to acquisition/ construction of qualifying assets are capitalized until the time all substantial activities necessary to prepare the qualifying assets for their intended use are complete.. A qualifying asset is one diat necessarily takes substantial period of time to get ready for its intended use/sale. Borrowing cost that is attributable to the projects is charged to the respective projects. All other borrowing costs,

10. Cash Flow Statement:

The Company has prepared Cash Flow Statement as per the AS-3. Cash flows are reported using the Indirect method, whereby net profit before tax is adjusted for the effects of transactions of a non cash nature, any deferrals or accruals of past or future operating cash receipts or payments and item of income or expenses associated with investing or financing cash flows. The cash flows from operating, investing and financing activities of the group are segregated.

11. Provisions, Contingent Liabilities and Contingent Assets:

Provisions are recognized for liabilities that can be measured only by using a substantial degree of estimation, if

a) The Company has a present obligation as a result of a past event;

b) A probable outflow of resources is expected to settle the obligation; and

c) The amount of the obligation can be reliably estimated.

Reimbursement expected in respect of expenditure required to settle a provision is recognized only when it is virtually certain that the reimbursement will be received.

Contingent Liability is disclosed in the case of:

a) A present obligation arising from a past event, when it is not probable that an outflow of resources will be required to settle the obligation;

b) A possible obligation, unless the probability of outflow of resources is remote. Contingent Assets are neither recognized nor disclosed.

12. Impairment of Assets:

Management periodically assesses using external and internal sources whether there is an indication that an asset may be impaired. Impairment occurs where the earning value exceeds the present value of future cash flows expected to arise from the continuing use of the asset and its eventual disposal. The impairment loss to be expensed is determined as the excess of the carrying amount over the higher of the asset''s net sale price or present value as determined above.

13. Related Party Disclosures :

The Company furnishes the details of Related Party Disclosures as given in Para 23 and 26 as required by AS-18.

14. Lease Rentals Operating Lease :

Leases where the lessor retains substantially all the risks and rewards of ownership arc classified as operating leases. The company charges Ixase rentals in respect of assets taken under operating leases to profit and loss account on a straight line basis over the lease term.

15. Finance Lease:

A Finance lease is a lease that transfers substantially all the risks and rewards incidental to the ownership of an asset.

16. Claims:

Claims made by the company are recognized to the extent the Company deems them recoverable. Claims against the Company, including liquidated damages, are recognized only on acceptance basis. Claims which arc contingent in nature arc not recognized in the books but are disclosed separately in the Notes to accounts. Contingent assets are neither recognized nor disclosed in the financial statements.

Operating Lease:

The company has taken its office premises on lease under operating lease agreement that is renewable on a periodic basis at the option of the both the lessor and the lessee. Rental expenses under those leases were Rs.5,88,21,733/- and for the previous year Rs. 1,89,53,128/-.

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Mar 31, 2010

General :

(i) These accounts are prepared on the historical cost basis and on the accounting principles of a going concern.

(ii) Accounting policies not specifically referred to otherwise are consistent and in consonance with generally accepted accounting principles.

Revenue Recognition :

(i) Income from software development is accounted for on the basis of Software developed and billed to clients on acceptance and/or on the basis of man days/man hours as per the terms of contract.

(ii) Revenue from professional services consist primarily of revenue earned from services performed on a time and material basis. The related revenue is recognised as and when the services are performed.

(iii) Revenue from software development services includes revenue from time and material and fixed price contracts are recognised as related services are performed.

(iv) Revenue on fixed price contracts is recognised in accordance with percentage of completion and method of account.

(v) Revenue is not recognised on the grounds of prudence, until realised in respect of liquidated damages, delayed payments as recovery of the amounts are not certain.

Foreign Exchange Transaction :

(i) Realised gains & loss in foreign exchange transactions are recognised in Profit & Loss Account.

(ii) Transactions in foreign currency will be recorded at the rates of exchange prevailing on the date of the transaction. Current assets and liabilities denominated in foreign currency will be translated at the rate of exchange as at Balance Sheet date.

Investments :

Investments are stated at cost i.e. cost of acquisition, inclusive of expenses incidental to acquisition wherever applicable.

Fixed Assets :

(i) Fixed assets are stated at cost less accumulated depreciation. Cost of acquisition of fixed assets is inclusive of freight, duties, taxes and incidental expenses thereto.

Depreciation and Amortisation :

(i) Depreciation is provided on straight line method on pro-rata basis and at the rates and manner specified in the Schedule XIV of the Companies Act, 1956.

(ii) Preliminary Expenses are amortised over the period of 5 years.

Taxation :

The current charge for income tax is calculated in accordance with the relevant tax regulations applicable to the Company. Deferred tax asset and liability is recognised for future tax consequences attributable to the timing differences that result between the profit offered for income tax and the profit as per the financial statements. Deferred tax asset & liability are measured as per the tax rates/laws that have been enacted or substantively enacted by the Balance Sheet date.

Earning Per Share:

The earning considered in ascertaining the companies earning per share comprise net profit after tax. The number of shares used in computing basic earning per share is the weighted average number of shares outstanding during the year.

Gratuity and Leave Encashment :

The provision for Gratuity and leave Encashment is calculated as per accrual method and included in current liability & provision.