Accounting Policies of Drone Destination Ltd. Company

Mar 31, 2025

1 Corporate information

Drone Destination Limited was incorporated on May 10, 2019 as Private Limited company. The company was converted from Private Limited to Limited on 4th May, 2023. The
company was listed with NSE under the SME Emerge 21st July, 2023 The company is engaged in the the business of trading, operations, manufacturing, repair, renting services
and training on various type of Drones including Multirotor, Fixed Wing, Hybrid UAV, e-VTOL, UAS, SUAV, RPV, RPAS, UWV, UGV etc._

2 Significant accounting policies

2.01 Basis of accounting and preparation of financial statements

The accounts have been prepared in accordance with the historical cost convention under accrual basis of accounting as per Indian GAAP. Accounts and Disclosures thereon
comply with the Accounting Standards specified in Companies (Accounting Standard) Rules, 2021 which continue to apply under Section 133 of the Companies Act, 2013 read
with Rule 7 of the Companies (Accounts) Rules, 2014, other pronouncement of ICAI, provisions of the Companies Act.

All assets and liabilities have been classified as current or non-current as per the company''s normal operating cycle and other criteria set out in Schedule III to the Companies
Act, 2013. Based on the nature of services provided, the Company has ascertained (except for Investment & Loans & Advances) its operating cycle as 12 months for the purpose
of current, noncurrent classification of assets & liabilities. In the case of Investments and Loan & Advances which are for purposes of setting up of infrastructure needed for
business, they are treated as Current Assets till they are partly paid up or till execution of a definitive agreement with the parties.

2.02 Use of estimates

The preparation of the financial statements in conformity with Indian GAAP requires the Management to make estimates and assumptions considered in the reported
amounts of assets and liabilities and the reported income and expenses during the year. The Management believes that the estimates used in preparation of the financial
statements are prudent and reasonable. Future results could differ due to these estimates and the differences between the actual results and the estimates are recognised in
the periods in which the results are known / materialise.

2.03 Revenue recognition
Revenue from Sales

Revenue is recognised when control of goods is transferred to a customer in accordance with the terms of the contract. The control of the goods is transferred upon delivery to
the customers either at the factory gate of the Company or a specific location of the customer or when the goods are handed over to the freight carrier, as per the terms of the
contract. A receivable is recognised by the Company when the goods are delivered to the customer as this represents the point in time at which the right to consideration
becomes unconditional, as only the passage of time is required before payment is due.

Revenue from services

• Revenues from contracts priced on a per activity basis are recognised on completion of the activity and those based on time and material basis are recognised when services are
rendered and related costs are incurred.

• Revenue from training is recognised when the training is completed.

• Revenue from Survey and Mapping is recognised as sales of services after the acceptance of the Data by the party/principal. If the data has been flown, processed and
submitted but yet to be accepted as it is treated as unbilled revenue. and If the data has been flown and/or processed but not submitted then the same is recognised as Work in
progress.

2.04 Other income

Interest income is accounted on accrual basis.

2.05 Employee benefits
Leave Policy

There is no policy of leave encashment. If the leaves are not availed during the year then the same will be lapsed and cannot be carried forward to the next year.

Gratuity

The Company''s gratuity plan is a defined benefit plan. Present value of obligations under such defined benefit plan is determined based on an actuarial valuation carried out by
an independent actuary using the Projected Unit Credit Method, which recognises each period of service as giving rise to additional unit of employee benefit entitlement and
measure each unit separately to build up the final obligation, The obligation is measured at the present value of estimated future cash flows. The discount rates used for
determining the present value of obligation under defined benefit plans, is based on the market yields on Government securities as at the Balance Sheet date, having maturity
periods approximating to the terms of related obligations.

Actuarial gains and losses are recognised immediately in the Statement of Profit and Loss. Gains or losses on the curtailment or settlement of any defined benefit plan are
recognised when the curtailment or settlement occurs.

2.06 Leases

Leases, where lessor effectively retains substantially all the risks and benefits of ownership of the leased asset during the leased term are classified as operating leases.

Operating lease payments are recognised as an expense in the Statement of Profit and Loss on a straight- line basis over the lease term.

2.07 Inventory

• Inventory of Stores and Spares is valued on the basis of Cost price.

• Inventory of stock in trade is valued at lower of cost or net reliasable value whichever is less.

2.08 Earnings per share

Basic earnings per share is computed by dividing the profit / (loss) after tax and excluding extraordinary and exceptional items divided by the weighted average number of
equity shares outstanding during the year.

2.09 Taxes on income

(I) Current tax is the amount of tax payable on the taxable income for the year as determined in accordance with the provisions of the Income Tax Act, 1961.

(ii) Deferred tax is recognised on timing differences, being the differences between the taxable income and the accounting income that originate in one period and are capable of
reversal in one or more subsequent periods. Deferred tax is measured using the tax rates and the tax laws enacted or substantially enacted as at the reporting date.

Deferred tax asset has been calculated on current assessment year loss as there is virtual certainty with convincing evidence that company will be able to recover losses in near

---

Mar 31, 2024

2 Significant accounting policies

2.01 Basis of accounting and preparation of financial statements

The accounts have been prepared in accordance with the historical cost convention under accrual basis of accounting as per Indian GAAP. Accounts and Disclosures thereon comply with the Accounting Standards specified in Companies (Accounting Standard) Rules, 2021 which continue to apply under Section 133 of the Companies Act, 2013 read with Rule 7 of the Companies (Accounts) Rules, 2014, other pronouncement of ICAI, provisions of the Companies Act.

All assets and liabilities have been classified as current or non-current as per the company''s normal operating cycle and other criteria set out in Schedule III to the Companies Act, 2013. Based on the nature of services provided, the Company has ascertained (except for Investment & Loans & Advances) its operating cycle as 12 months for the purpose of current, noncurrent classification of assets & liabilities. In the case of Investments and Loan & Advances which are for purposes of setting up of infrastructure needed for business, they are treated as Current Assets till they are partly paid up or till execution of a definitive agreement with the parties.

2.02 Use of estimates

The preparation of the financial statements in conformity with Indian GAAP requires the Management to make estimates and assumptions considered in the reported amounts of assets and liabilities and the reported income and expenses during the year. The Management believes that the estimates used in preparation of the financial statements are prudent and reasonable. Future results could differ due to these estimates and the differences between the actual results and the estimates are recognised in the periods in which the results are known / materialise.

2.03 Revenue recognition

Income from services

• Revenues from contracts priced on a per activity basis are recognised on completion of the activity and those based on time and material basis are recognised when services are rendered and related costs are incurred.

• Revenue from training is recognised when the training is completed.

• Revenue from Survey and Mapping is recognised after Drone data capturing, processing and submission. If the data has been captured and processed but not submitted then the same is recognised under Unbilled Revenue.

2.04 Other income

Interest income is accounted on accrual basis.

2.05 Employee benefits Leave Policy

There is no policy of leave encashment. If the leaves are not availed during the year then the same will be lapsed and cannot be carried forward to the next year.

Gratuity

The Company''s gratuity plan is a defined benefit plan. Present value of obligations under such defined benefit plan is determined based on an actuarial valuation carried out by an independent actuary using the Projected Unit Credit Method, which recognises each period of service as giving rise to additional unit of employee benefit entitlement and measure each unit separately to build up the final obligation, The obligation is measured at the present value of estimated future cash flows. The discount rates used for determining the present value of obligation under defined benefit plans, is based on the market yields on Government securities as at the Balance Sheet date, having maturity periods approximating to the terms of related obligations.

Actuarial gains and losses are recognised immediately in the Statement of Profit and Loss. Gains or losses on the curtailment or settlement of any defined benefit plan are recognised when the curtailment or settlement occurs.

2.06 Leases

Leases, where lessor effectively retains substantially all the risks and benefits of ownership of the leased asset during the leased term are classified as operating leases. Operating lease payments are recognised as an expense in the Statement of Profit and Loss on a straight- line basis over the lease term.

2.07 Inventory

• Inventory of Stores and Spares is valued on the basis of Cost price.

• Inventory of stock in trade is valued at lower of cost or net reliasable value.

2.08 Earnings per share

Basic earnings per share is computed by dividing the profit / (loss) after tax and excluding extraordinary and exceptional items divided by the weighted average number of equity shares outstanding during the year.

2.09 Taxes on income

(I) Current tax is the amount of tax payable on the taxable income for the year as determined in accordance with the provisions of the Income Tax Act, 1961.

(ii) Deferred tax is recognised on timing differences, being the differences between the taxable income and the accounting income that originate in one period and are capable of reversal in one or more subsequent periods. Deferred tax is measured using the tax rates and the tax laws enacted or substantially enacted as at the reporting date.

Deferred tax asset has been calculated on current assessment year loss as there is virtual certainty with convincing evidence that company will be able to recover losses in near future.

---

Mar 31, 2023

1 Corporate information

Drone Destination Limited was incorporated on May 10, 2019 as private limited company. The company was converted from Private Limited to limited on 4th May, 2023. The company is engaged in the the business of trading, operations, manufacturing, repair, renting services and training on various type of Drones including Multirotor, Fixed Wing, Hybrid UAV, e-VTOL, UAS, SUAV, RPV, RPAS, UWV, UGV etc.,

_2 Significant accounting policies_

2.01    Basis of accounting and preparation of financial statements

The accounts have been prepared in accordance with the historical cost convention under accrual basis of accounting as per Indian GAAP. Accounts and Disclosures thereon comply with the Accounting Standards specified in Companies (Accounting Standard) Rules, 2021 which continue to apply under Section 133 of the Companies Act, 2013 read with Rule 7 of the Companies (Accounts) Rules, 2014, other pronouncement of ICAI, provisions of the Companies Act.

All assets and liabilities have been classified as current or non-current as per the company’s normal operating cycle and other criteria set out in Schedule III to the Companies Act, 2013. Based on the nature of services provided, the Company has ascertained (except for Investment & Loans & Advances) its operating cycle as 12 months for the purpose of current, noncurrent classification of assets & liabilities. In the case of Investments and Loan & Advances which are for purposes of setting up of infrastructure needed for business, they are treated as Current Assets till they are partly paid up or till execution of a definitive agreement with the parties.

2.02    Use of estimates

The preparation of the financial statements in conformity with Indian GAAP requires the Management to make estimates and assumptions considered in the reported amounts of assets and liabilities and the reported income and expenses during the year. The Management believes that the estimates used in preparation of the financial statements are prudent and reasonable. Future results could differ due to these estimates and the differences between the actual results and the estimates are recognised in the periods in which the results are known / materialise.

2.03    Revenue recognition

Income from services

Revenues from contracts priced on a per activity basis are recognised on completion ofthe activity and those based on time and material basis are recognised when services are rendered and related costs are incurred.

Revenue from training is recognised when the training is completed.

Revenue from Survey and Mapping is recognised after Drone data capturing, processing and submission.

2.04    Other income

Interest income is accounted on accrual basis.

2.05    Employee benefits Leave Policy

The company has a leave policy in which in addition to gazetted and restricted holidays, every employee employed in the company is entitled to sick leaves, casual leaves and privileged leaves, based on the below stated rules and regulations which are applicable to all employees. Casual/Sick Leaves

Every employee on completion of 1 month of continuous employment is eligible for 1 day of casual/sick leave every month.

At one instance only three leaves can be availed from sick/casual leave quota of 12 days in a year as per Leave Policy.

No carry forward or encashment of sick leaves can be done.

Privileged Leaves

Every employee after completion of 12 continuous months of employment is eligible for 15 days privileged leaves.

Every employee after completion of 4 continuous months of employment is eligible for 5 days privileged leaves.

No encashment shall be provided in lieu of privileged leaves. However in case of non utilization of privileged leave, it can be carried forward for 2 years.

Sick leaves, casual leaves and privileged leaves cannot be combined in any case.

Gratuity

The Company's gratuity plan is a defined benefit plan. Present value of obligations under such defined benefit plan is determined based on an actuarial valuation carried out by an independent actuary using the Projected Unit Credit Method, which recognises each period of service as giving rise to additional unit of employee benefit entitlement and measure each unit separately to build up the final obligation, The obligation is measured at the present value of estimated future cash flows. The discount rates used for determining the present value of obligation under defined benefit plans, is based on the market yields on Government securities as at the Balance Sheet date, having maturity periods approximating to the terms of related obligations.

Actuarial gains and losses are recognised immediately in the Statement of Profit and Loss. Gains or losses on the curtailment or settlement of any defined benefit plan are recognised when the curtailment or settlement occurs.

2.06    Leases

Leases, where lessor effectively retains substantially all the risks and benefits of ownership of the leased asset during the leased term are classified as operating leases. Operating lease payments are recognised as an expense in the Statement of Profit and Loss on a straight- line basis over the lease term.

2.07    Inventory

Inventory of Stores and Spares is valued on the basis of Cost price.

2.08    Earnings per share

Basic earnings per share is computed by dividing the profit / (loss) after tax and excluding extraordinary and exceptional items divided by the weighted average number of equity shares outstanding during the year.

2.09    Taxes on income

(I) Current tax is the amount of tax payable on the taxable income for the year as determined in accordance with the provisions of the Income Tax Act, 1961.

(ii) Deferred tax is recognised on timing differences, being the differences between the taxable income and the accounting income that originate in one period and are capable of reversal in one or more subsequent periods. Deferred tax is measured using the tax rates and the tax laws enacted or substantially enacted as at the reporting date.

Deferred tax asset has been calculated on current assessment year loss as there is virtual certainty with convincing evidence that company will be able to recover losses in near future.

2.10    Provisions

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

2.11    GST input credit

GST input credit is accounted for in the books in the period in which the underlying service received is accounted and when there is no uncertainty in availing / utilizing the credits.

2.12    Pre-incorporation Expenses

Pre-incorporation Expenses are being written off in the first year of incorporation.

2.13    Property, Plant & Equipment and Intangible Assets

Property, Plant & Equipment and Intangible Assets are stated at their original cost and include all expenses relating to their acquisition and installation.

2.14    Depreciation Amortization

Depreciation on Property, Plant & Equipment and Intangible Assets has been provided on written down value method in terms of life span of assets as specified in Schedule II of the Companies Act, 2013. In Schedule II of Companies Act 2013 no useful life particularly for Drones is mentioned, thus, the company has considered the useful life of Drones under Plant and Machinery of five (5) years.

2.15    Impairment/Discarding of Assets

The company periodically assesses using internal sources (keeping in view the nature of assets at present) whether there is an indication that an asset may be impaired. The difference between the book value and recoverable value of relevant assets being Impairment loss, when crystallizes, is charged against revenue of the year.

2.16    Foreign Currency Transactions

Foreign exchange transactions during the year are recorded at the exchange rate prevailing on the date of the transaction. Gains or losses arising out of fluctuations in exchange rate between transaction date and settlement date are recognized in the Statement of Profit and Loss.

2.17    Current and non-current classification

All assets and liabilities are classified into current and non-current.

Assets

An asset is classified as current when it satisfies any of the following criteria :-

It is expected to be realized in, or is intended for sale or consumption in, the company's normal operating cycle,

It is held for the purpose of being traded,

It is expected to be realized within 12 months after the reporting date, or

It is cash or cash equivalents unless it is restricted from being exchanged or used to settle a liability for at least 12 months after the reporting date. Current assets include the current portion of non-current financial Assets.

All other assets are classified as non-current.

Liability

A Liability is classified as current when it satisfies any of the following criteria:-It is expected to be settled in the company's normal operating cycle,

It is held Primarily for the purpose of being traded,

It is due to be settled within 12 months from the reporting date, or

The company does not have an unconditional right to defer settlement of liability at least 12 months after the reporting date. Terms of the liability that could at the option of the counter party, result in its settlement by the issue of equity instruments do not affect its classification.

Current liabilities include the current portion of non-current financial liabilities.

All other liabilities are classified as non-current.

2.18    Cash and cash Equivalents

Cash and cash equivalent Cash and cash equivalents comprise cash balances on hand, cash balance with bank and highly liquid investments with original maturities, at the date of purchase/investment, of three months or less.

2.19    Operating Cycle

Operating cycle is the time between the acquisition of assets for processing and their realization in cash or cash equivalents, Based on the nature of activities and the time between the acquisition of assets for processing and their realisation in cash and cash equivalents, the Company has ascertained its operating cycle within twelve months for the purposes of current/ non-current classification of its assets and liabilities