Accounting Policies of Frog Innovations Ltd. Company

Mar 31, 2025

2 Summary of Significant Accounting Policies

a) Basis of Preparation of Financial Statements

The financial statements of the Company have
been prepared in accordance with generally
accepted accounting principles of India (Indian
GAAP). The Company has prepared these financial
statements to comply in all material respects with
the accounting standards notified under section
133 of the Companies Act, 2013, read together
with Rule 7 of the Companies (Accounts) Rules,
2014 and the relevant provisions of the Companies
Act, 2013 (''the Act''). The financial statements have
been prepared on an accrual basis and under the
historical cost convention.

The accounting policies adopted in the preparation
of financial statements are consistent with those of
previous year unless otherwise disclosed.

b) Use of Estimates

The preparation of financial statements in
conformity with Indian GAAP requires management
to make estimates and assumptions that affect the
application of accounting policies and reported
amounts of assets, liabilities, revenues and
expenses and disclosure of contingent assets and

liabilities at the date of the financial statements.
The estimates and assumptions used in the
accompanying financial statements are based
upon management''s evaluation of the relevant
facts and circumstances as of the date of financial
statements which in management''s opinion are
prudent and reasonable. Actual results may
differ from the estimates used in preparing the
accompanying financial statements. However,
accounting estimates could change from period to
period. Appropriate changes in estimates are made
as the Management becomes aware of changes
in circumstances surrounding the estimates. Any
revision to accounting estimates is recognised
prospectively in current and future periods and, if
material, their effects are disclosed in the notes to
the Standalone financial statements.

c) Functional and Presentation Currency

These financial statements are presented in Indian
Rupees (''), the company''s functional currency. All
Financial information presented in Indian Rupee
has been rounded off to the nearest lakh as per
the requirements of Schedule III of "the Act" unless
otherwise stated.

d) 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:

i) It is expected to be realized in, or is intended
for sale or consumption in, the Company''s
normal operating cycle;

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

iii) It is expected to be realized within 12 months
after the reporting date; or

iv) It is cash or cash equivalent 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.

Liabilities

A liability is classified as current when it satisfies
any of the following criteria:

i) It is expected to be settled in the Company''s
normal operating cycle;

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

iii) It is due to be settled within 12 months after
the reporting date; or

iv) The Company does not have an unconditional
right to defer settlement of the liability for at
least 12 months after the reporting date.

Current liabilities include the current portion
of non-current financial liabilities. All other
liabilities are classified as non-current.

e) Operating Cycle

Operating cycle is the time between the acquisition
of assets for processing and their realisation in
cash and cash equivalents. Based on the above
definition and nature of business, the company
has ascertained its operating cycle as less than 12
months for the purpose of current/ non current
classification of assets and liabilities.

f) Property, Plant and Equipment, Intangible
Assets & CWIP

Property, Plant and Equipment

Property, Plant and Equipment are stated at cost
less accumulated depreciation. The total cost of
assets comprises its purchase price, freight, duties,
taxes and any other incidental expenses directly
attributable to bringing the asset to the working
condition for its intended use and interest on loans
attributable to the acquisition of assets up to the
date of commissioning of assets.

Subsequent costs related to an item of property,
plant and equipment are recognized as a separate
asset, as appropriate, only when it is probable that
future economic benefits associated with the item
will flow to the company and the cost of the item
can be measured reliably. The carrying amount of
any component accounted for as a separate asset
is derecognized when replaced. All other repairs
and maintenance are recognized in statement of
profit and loss during the reporting period when
they are incurred.

An item of property, plant and equipment is de¬
recognized on disposal or when no future economic
benefits are expected from its use or disposal.
The gains or losses arising from de-recognition
are measured as the difference between the net
disposal proceeds and the carrying amount of the
asset and are recognized in the statement of profit
and loss when the asset is derecognized.

Intangible Assets

Intangible assets are recognized if it is probable that

the future economic benefits that are attributable
to the assets will flow to the Company and cost
of the assets can be measured reliably. The cost
of intangible assets comprises its purchase price,
including any duties and other taxes and any
directly attributable expenditure on making the
asset ready for its intended use.

An item of an intangible asset is de-recognized on
disposal or when no future economic benefits are
expected from its use or disposal. The gains or
losses arising from de-recognition are measured as
the difference between the net disposal proceeds
and the carrying amount of the asset and are
recognized in the statement of profit and loss
when the asset is derecognized.

Subsequent costs related to intangible assets are
recognised as a separate asset, as appropriate, only
when it is probable that future economic benefits
associated with the item will flow to the Group and
the cost of the item can be measured reliably.

Capital Work In Progress

Capital work in progress are carried at cost,
comprising direct cost, related incidental expenses
during the construction period, attributable
borrowing costs for the qualifying assets and other
expenses incurred in connection with project
implementation in so far as such expenses relate
to the period prior to the commencement of
commercial production. Advances given towards
the construction of the capital asset outstanding
at each balance sheet date are disclosed as capital
advances under long term loans and advances.

g) Depreciation and Amortisation

Depreciation on Property, Plant and Equipment is
provided on written down value method for the
PPE purchased before the 01.04.2023, at the rates
arrived at on the basis of the estimated economic
useful life of the assets. The useful life for building,
plant & machinery & leasehold improvements
is considered as prescribed in Schedule II of
the Companies Act, 2013, representing the
management''s estimate of the useful life of these
assets and following consistency with previous
year.

Depreciation on Property, Plant and Equipment
is provided on straight line method for the PPE
purchased on or after 01.04.2023, at the rates
arrived at on the basis of the estimated economic
useful life of the assets. The useful life for building,
plant & machinery & leasehold improvements
is considered as prescribed in Schedule II of
the Companies Act, 2013, representing the

management''s estimate of the useful life of these
assets and following consistency with previous
year.

Amortization of the intangible asset begins when
the asset is acquired and is available for use. It
is amortized over the period of expected future
benefit. Amortization expense is recognized in
the statement of profit and loss unless such
expenditure forms part of the carrying value of
another asset. The estimated useful life of the
intangible assets, amortization method and the
amortization period are reviewed at the end of
each financial year. Intangible assets are amortized
with a finite useful life using the Written down value
method.

The Company may reclassify assets from one head
to another in order to ensure more appropriate
presentation of the financial statements, in
accordance with applicable accounting standards.
Such reclassifications are made prospectively and
are reflected in the books of accounts from the
date of reclassification. These changes do not
affect the overall carrying value of the assets or the
reported financial results.

The company has estimated residual value of the
assets to be 5% of the cost of the asset.

*The Schedule II has not defined useful life of
the intangible asset, however it suggests to refer
accounting standard for life of the intangible asset.
As per the Accounting Standard 26 Intangible Asset
, the useful life of the intangible asset shall not
exceed 10 years.

h) Revenue Recognition

Revenue is recognized to the extent that it is
probable that the economic benefits will flow
to the Company and the revenue can be reliably
measured.

Sale of goods

Revenue from sale of goods is recognized on
transfer of all significant risks and rewards related
to the ownership of such goods to the buyer. Sales
are stated net of trade discount, sales return,
duties and GST. Revenue is recognized only when
it can be reliably measured and it is reasonable to
expect ultimate collection.

Sale of service

Revenue from services provided is recognized
based on contractual terms and rateably over the
period in which services are rendered. Revenue
from the end of the last billing to the Balance Sheet
date is recognized as unbilled revenues. Revenue
from fixed-price and fixed-timeframe contracts,
where there is no uncertainty as to measurement or
collectability of consideration, is recognized based
upon the percentage-of-completion method.

Interest income

Interest income is recognized on time proportion
basis on interest rates implicit in the transaction.

Dividend Income

Dividend income is recognised on receipt basis.
Other Income

Other income is recognized based on the
contractual obligations on accrual basis.

Lease rentals are recognised on a straight line
basis over the period of lease.

Other Operating Revenue

Export incentives, production linked incentives and
subsidies are recognized when there is reasonable
assurance that the Company is complying with the
conditions and the incentive will be received.

i) Inventories

Inventories are valued at cost or net realisable

value, whichever is lower. Cost comprises of all
costs of purchase, costs of conversion and other
costs incurred in bringing the inventories to their
present location and condition and is determined
on weighted average method. Net Realizable Value
is the estimated selling price in the ordinary course
of business less estimated cost of completion and
the estimated cost necessary to make the sale.

Raw materials, components, stores and spares are
valued at lower of cost and net realizable value.
However, materials and other items held for use
in production of inventories are not written down
below cost if the finished products in which they
will be incorporated are expected to be sold at or
above cost. Cost of raw materials, components
and stores and spares is determined on weighted
average basis.

Work in progress and finished goods are valued at
lower of cost and net realizable value. Cost includes
direct material and labour and a proportion
of manufacturing overheads based on normal
operating capacity. Cost is determined on weighted
average basis.

j) Foreign Currency Transactions
Initial recognition

Foreign currency transactions are recorded in
the reporting currency which is Indian Rupee,
by applying to the foreign currency amount the
exchange rate between the reporting currency
and the foreign currency at the date of the
transaction.

Conversion

Monetary assets and liabilities in foreign currency,
which are outstanding as at the year-end, are
revalued at the year-end at the closing exchange
rate and the resultant exchange differences are
recognized in the Statement of Profit and Loss at
the year end.

Exchange Differences

All exchange differences are recognized as income
or as expenses in the period in which they arise.

k) Retirement and other employee benefits

The Company''s obligation towards various
employee benefits has been recognised as follows:

Short term employee benefit

All employee benefits payable wholly within twelve
months of rendering the service are classified
as short-term employee benefits. Short term
employee benefit obligations are expensed when

the related services are provided. Liabilities for
wages and salaries, including non-monetary
benefits that are expected to be settled wholly
within twelve months after the end of the period
in which the employees render the related service
are recognized in respect of employees'' services
up to the end of the reporting period.

Defined contribution plans

The company''s contributions to the Provident Fund
and Employee State Insurance are charged to the
Statement of Profit and Loss of the year when the
contributions to the respective funds are due. Both
the employee and the employer make monthly
contributions to the plan at a predetermined rate
of the employee''s basic salary. These contributions
are made to the fund administered and managed
by the government of India.

Post Employment Benefits

Defined benefits plans

The company operates two defined benefit plans
for its employees: gratuity and leave encashment.
The cost of providing benefits under these plans
is determined on the basis of actuarial valuation,
carried out by an independent actuary, at each
year-end. A separate actuarial valuation is carried
out for each plan using the projected unit credit
method which recognizes each period of service as
giving rise to an additional unit of employee benefit
entitlement and measures each unit separately to
build up the final obligation. Actuarial losses and
gain for both defined benefit plans are recognised
in full in the period in which they occur in the
statement of profit and loss.

The Company''s gratuity benefit scheme is a defined
benefit plan. The Company''s net obligation in
respect of the gratuity benefit scheme is calculated
by estimating the amount of future benefit that
employees have earned in return for their service
in the current and prior periods; that benefit is
discounted to determine its present value, and
the fair value of any plan assets is deducted. The
Company provides for the Gratuity Plan based on
projection valuations in accordance with Accounting
Standard 15 (Revised), "Employee Benefits".

The employees of the Company are entitled
to compensated absences which are both
accumulating and non-accumulating in nature.
The expected cost of accumulating compensated
absences is determined on the additional amount
expected to be paid / availed as a result of the
unused entitlement that has accumulated at the
Balance Sheet date. Expense on non-accumulating

compensated absences is recognized in the period
in which the absences occur.

The obligation is measured at the present value
of the estimated future cash flows. The discount
rates used for determining the present value of the
obligation under defined benefit plan are based on
the market yields on Government Securities as at
the Balance Sheet date.

Actuarial gains and losses comprise experience
adjustments and the effects of changes in actuarial
assumptions and are recognized immediately in
the Statement of Profit and Loss.

l) Leases

Operating lease: Leases where the lessor
effectively retains substantially all the risks and
benefits of ownership of the leased item, are
classified as operating lease. Payments made
under cancellable operating leases are charged to
the Profit & loss Account on a straight line basis
over the period of lease.

Finance lease: Principal amount of the finance lease
is capitalized and depreciated accordingly. Finance
charges are charged to Profit & Loss Account
over the period of the lease. Finance lease, which
effectively transfers to the company substantially
all the risks and benefits incidental to ownership
of the leased item, are capitalised at the lower of
fair value and present value of the minimum lease
payments at the inception of the lease term and
disclosed as leased assets. Finance charges are
recognised as finance cost in statement of profit
and loss account.

m) Taxation

Income-tax expense comprises current tax and
deferred tax.

Current tax

Provision for current tax is made for the tax liability
payable on taxable income after considering
tax allowances, deductions and exemptions
determined in accordance with the prevailing tax
laws. The tax currently payable is based on taxable
profit for the year. Taxable profit differs from ''profit
before tax'' as reported in the statement of profit
and loss because of items of income or expense
that are taxable or deductible in other years and
items that are never taxable or deductible.

The company''s current tax is calculated using the
tax rates as prescribed in the section 115BAA of
the Income Tax Act, 1961.

Deferred tax

Deferred tax liability or asset is recognized for
timing differences between the profits/losses
offered for income tax and profits/losses as per
the financial statements. Deferred tax assets and
liabilities are measured using the tax rates and
tax laws that have been enacted or substantively
enacted at the Balance Sheet date.

Deferred tax asset is recognized only to the extent
there is reasonable certainty that the assets
can be realized in future. However, where there
is unabsorbed depreciation or carried forward
loss under taxation laws, deferred tax asset on
such losses is recognized only if there is a virtual
certainty of their realization. Deferred tax assets
and liabilities are reviewed at each Balance Sheet
date and written down or written up to reflect the
amount that is reasonably/virtually certain to be
realized.

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

n) Borrowing Cost

Borrowing costs to the extent related/attributable
to the acquisition/construction of assets that
takes substantial period of time to get ready for
their intended use are capitalized along with the
respective Property, Plant and Equipment up to the
date such asset is ready for use. Other borrowing
costs are recognised as expense in the Statement
of Profit and Loss in the period in which they are
incurred.

o) Earning Per Share
Basic EPS

In determining earnings per share, the Company
considers the net profit / (loss) after tax and
includes the effect of extraordinary items in the
profit and loss account. The number of shares
used in computing basic earnings per share is the
weighted average number of shares outstanding
during the period. The weighted average number
of equity shares outstanding during the period is
adjusted for events such as bonus issue and issue
of fresh equity shares under IPO that have changed
the number of equity shares outstanding at the
year end.

Diluted EPS

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

p) Investment

Investments that are readily realizable and intended
to be held for not more than a year are classified
as current investments. All other investments
are classified as long-term investments. Current
investments are carried at lower of cost and fair
value determined on an individual investment
basis. Long-term investments are carried at cost.
However, provision for diminution in value is made
to recognize a decline other than temporary in the
value of the investments.

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Mar 31, 2024

2 Summary of Significant Accounting Policies

a) Basis of Preparation of Financial Statements

The financial statements of the Company have been prepared in accordance with generally accepted accounting principles of India (Indian GAAP). The Company has prepared these financial statements to comply in all material respects with the accounting standards notified under section 133 of the Companies Act, 2013, read together with Rule 7 of the Companies (Accounts) Rules, 2014 and the relevant provisions of the Companies Act, 2013 (''the Act''). The financial statements have been prepared on an accrual basis and under the historical cost convention. The accounting policies adopted in the preparation of financial statements are consistent with those of previous year unless otherwise disclosed.

b) Use of Estimates

The preparation of financial statements in conformity with Indian GAAP requires management to make estimates and assumptions that affect the application of accounting policies and reported amounts of assets, liabilities, revenues and expenses and disclosure of contingent assets and liabilities at the date of the financial statements. The estimates and assumptions used in the

accompanying financial statements are based upon management''s evaluation of the relevant facts and circumstances as of the date of financial statements which in management''s opinion are prudent and reasonable. Actual results may differ from the estimates used in preparing the accompanying financial statements. However, accounting estimates could change from period to period. Appropriate changes in estimates are made as the Management becomes aware of changes in circumstances surrounding the estimates. Any revision to accounting estimates is recognised prospectively in current and future periods and, if material, their effects are disclosed in the notes to the Standalone financial statements.

c) Functional and Presentation Currency

These financial statements are presented in Indian Rupees (''), the company''s functional currency. All Financial information presented in Indian Rupee has been rounded off to the nearest lakh as per the requirements of Schedule III of "the Act" unless otherwise stated.

d) 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:

i) It is expected to be realized in, or is intended for sale or consumption in, the Company''s normal operating cycle;

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

iii) It is expected to be realized within 12 months after the reporting date; or

iv) It is cash or cash equivalent 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.

Liabilities

A liability is classified as current when it satisfies any of the following criteria:

i) It is expected to be settled in the Company''s normal operating cycle;

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

iii) It is due to be settled within 12 months after the reporting date; or

iv) The Company does not have an unconditional right to defer settlement of the liability for at least 12 months after the reporting date.

Current liabilities include the current portion of non-current financial liabilities. All other liabilities are classified as non-current.

e) Operating Cycle

Operating cycle is the time between the acquisition of assets for processing and their realisation in cash and cash equivalents. Based on the above definition and nature of business, the company has ascertained its operating cycle as less than 12 months for the purpose of current/ non current classification of assets and liabilities.

f) Property, Plant and Equipment Intangible Assets & CWIP

Property, Plant and Equipment

Property, Plant and Equipment are stated at cost less accumulated depreciation. The total cost of assets comprises its purchase price, freight, duties, taxes and any other incidental expenses directly attributable to bringing the asset to the working condition for its intended use and interest on loans attributable to the acquisition of assets up to the date of commissioning of assets.

Subsequent costs related to an item of property, plant and equipment are recognized as a separate asset, as appropriate, only when it is probable that future economic benefits associated with the item will flow to the Group and the cost of the item can be measured reliably. The carrying amount of any component accounted for as a separate asset is derecognized when replaced. All other repairs and maintenance are recognized in statement of profit and loss during the reporting period when they are incurred.

An item of property, plant and equipment is derecognized on disposal or when no future economic benefits are expected from its use or disposal. The gains or losses arising from de-recognition are measured as the difference between the net disposal proceeds and the carrying amount of the asset and are recognized in the statement of profit and loss when the asset is derecognized.

Intangible Assets

Intangible assets are recognized if it is probable that the future economic benefits that are attributable to the assets will flow to the Company and cost of the assets can be measured reliably. The cost

of intangible assets comprises its purchase price, including any duties and other taxes and any directly attributable expenditure on making the asset ready for its intended use.

An item of an intangible asset is de-recognized on disposal or when no future economic benefits are expected from its use or disposal. The gains or losses arising from de-recognition are measured as the difference between the net disposal proceeds and the carrying amount of the asset and are recognized in the statement of profit and loss when the asset is derecognized.

Subsequent costs related to intangible assets are recognised as a separate asset, as appropriate, only when it is probable that future economic benefits associated with the item will flow to the Group and the cost of the item can be measured reliably.

Capital Work In Progress

Capital work in progress are carried at cost, comprising direct cost, related incidental expenses during the construction period, attributable borrowing costs for the qualifying assets and other expenses incurred in connection with project implementation in so far as such expenses relate to the period prior to the commencement of commercial production. Advances given towards the construction of the capital asset outstanding at each balance sheet date are disclosed as capital advances under long term loans and advances.

g) Depreciation and Amortisation

Depreciation on Property, Plant and Equipment is provided on written down value method for the PPE purchased before the 01.04.2023, at the rates arrived at on the basis of the estimated economic useful life of the assets. The useful life for building, plant & machinery & leasehold improvements is considered as prescribed in Schedule II of the Companies Act, 2013, representing the management''s estimate of the useful life of these assets and following consistency with previous year.

Depreciation on Property, Plant and Equipment is provided on straight line method for the PPE purchased on or after 01.04.2023, at the rates arrived at on the basis of the estimated economic useful life of the assets. The useful life for building, plant & machinery & leasehold improvements is considered as prescribed in Schedule II of the Companies Act, 2013, representing the management''s estimate of the useful life of these assets and following consistency with previous year.

Amortization of the intangible asset begins when the asset is acquired and is available for use. It is amortized over the period of expected future benefit. Amortization expense is recognized in the statement of profit and loss unless such expenditure forms part of the carrying value of another asset. The estimated useful life of the intangible assets, amortization method and the amortization period are reviewed at the end of each financial year. Intangible assets are amortized with a finite useful life using the Written down value method.

The company''s computer software has an estimated useful life of three years as its licence is renewed after every three years.

The company has estimated residual value of the assets to be 5% of the cost of the asset.

*The Schedule II has not defined useful life of the intangible asset, however it suggests to refer accounting standard for life of the intangible asset. As per the Accounting Standard 26 Intangible Asset, the useful life of the intangible asset shall not exceed 10 years.

h) Revenue Recognition

Revenue is recognized to the extent that it is probable that the economic benefits will flow to the Company and the revenue can be reliably measured.

Sale ofgoods

Revenue from sale of goods is recognized on transfer of all significant risks and rewards related to the ownership of such goods to the buyer. Sales are stated net of trade discount, sales return, duties and GST. Revenue is recognized only when it can be reliably measured and it is reasonable to expect ultimate collection.

Sale of service

Revenue from services provided is recognized based on contractual terms and ratably over the period in which services are rendered. Revenue from the end of the last billing to the Balance Sheet date is recognized as unbilled revenues. Revenue from fixed-price and fixed-timeframe contracts, where there is no uncertainty as to measurement or collectability of consideration, is recognized based upon the percentage-of-completion method.

Interest income

Interest income is recognized on time proportion basis on interest rates implicit in the transaction.

Dividend Income

Dividend income is recognised on receipt basis. Other Income

Other income is recognized based on the contractual obligations on accrual basis.

Lease rentals are recognised on a straight line basis over the period of lease.

Other Operating Revenue

Export incentives, production linked incentives and subsidies are recognized when there is reasonable assurance that the Company is complying with the conditions and the incentive will be received.

i) Inventories

Inventories are valued at cost or net realisable value, whichever is lower. Cost comprises of all costs of purchase, costs of conversion and other costs incurred in bringing the inventories to their present location and condition and is determined on weighted average method. Net Realizable Value is the estimated selling price in the ordinary course of business less estimated cost of completion and the estimated cost necessary to make the sale.

Raw materials, components, stores and spares are valued at lower of cost and net realizable value. However, materials and other items held for use in production of inventories are not written down below cost if the finished products in which they

will be incorporated are expected to be sold at or above cost. Cost of raw materials, components and stores and spares is determined on weighted average basis.

Work in progress and finished goods are valued at lower of cost and net realizable value. Cost includes direct material and labour and a proportion of manufacturing overheads based on normal operating capacity. Cost is determined on weighted average basis.

j) Foreign Currency Transactions Initial recognition

Foreign currency transactions are recorded in the reporting currency which is Indian Rupee, by applying to the foreign currency amount the exchange rate between the reporting currency and the foreign currency at the date of the transaction.

Conversion

Monetary assets and liabilities in foreign currency, which are outstanding as at the year-end, are revalued at the year-end at the closing exchange rate and the resultant exchange differences are recognized in the Statement of Profit and Loss at the year end.

Exchange Differences

All exchange differences are recognized as income or as expenses in the period in which they arise.

k) Retirement and other employee benefits

The Company''s obligation towards various employee benefits has been recognised as follows:

Short term employee benefit

All employee benefits payable wholly within twelve months of rendering the service are classified as short-term employee benefits. Short term employee benefit obligations are expensed when the related services are provided. Liabilities for wages and salaries, including non-monetary benefits that are expected to be settled wholly within twelve months after the end of the period in which the employees render the related service are recognized in respect of employees'' services up to the end of the reporting period.

Defined contribution plans

The company''s contributions to the Provident Fund and Employee State Insurance are charged to the Statement of Profit and Loss of the year when the contributions to the respective funds are due. Both the employee and the employer make monthly

contributions to the plan at a predetermined rate of the employee''s basic salary. These contributions are made to the fund administered and managed by the government of India.

Post Employment Benefits

Defined benefits plans

The company operates two defined benefit plans for its employees: gratuity and leave encashment. The cost of providing benefits under these plans is determined on the basis of actuarial valuation, carried out by an independent actuary, at each year-end. A separate actuarial valuation is carried out for each plan using the projected unit credit method which recognizes each period of service as giving rise to an additional unit of employee benefit entitlement and measures each unit separately to build up the final obligation. Actuarial losses and gain for both defined benefit plans are recognised in full in the period in which they occur in the statement of profit and loss.

The Company''s gratuity benefit scheme is a defined benefit plan. The Company''s net obligation in respect of the gratuity benefit scheme is calculated by estimating the amount of future benefit that employees have earned in return for their service in the current and prior periods; that benefit is discounted to determine its present value, and the fair value of any plan assets is deducted. The Company provides for the Gratuity Plan based on projection valuations in accordance with Accounting Standard 15 (Revised), "Employee Benefits".

The employees of the Company are entitled to compensated absences which are both accumulating and non-accumulating in nature. The expected cost of accumulating compensated absences is determined on the additional amount expected to be paid / availed as a result of the unused entitlement that has accumulated at the Balance Sheet date. Expense on non-accumulating compensated absences is recognized in the period in which the absences occur.

The obligation is measured at the present value of the estimated future cash flows. The discount rates used for determining the present value of the obligation under defined benefit plan are based on the market yields on Government Securities as at the Balance Sheet date.

Actuarial gains and losses comprise experience adjustments and the effects of changes in actuarial assumptions and are recognized immediately in the Statement of Profit and Loss.

l) Leases

Operating lease: Leases where the lessor effectively retains substantially all the risks and benefits of ownership of the leased item, are classified as operating lease. Payments made under cancellable operating leases are charged to the Profit & loss Account on a straight line basis over the period of lease.

Finance lease: Principal amount of the finance lease is capitalized and depreciated accordingly. Finance charges are charged to Profit & Loss Account over the period of the lease. Finance lease, which effectively transfers to the company substantially all the risks and benefits incidental to ownership of the leased item, are capitalised at the lower of fair value and present value of the minimum lease payments at the inception of the lease term and disclosed as leased assets. Finance charges are recognised as finance cost in statement of profit and loss account.

m) Taxation

Income-tax expense comprises current tax and deferred tax.

Current tax

Provision for current tax is made for the tax liability payable on taxable income after considering tax allowances, deductions and exemptions determined in accordance with the prevailing tax laws. The tax currently payable is based on taxable profit for the year. Taxable profit differs from ''profit before tax'' as reported in the statement of profit and loss because of items of income or expense that are taxable or deductible in other years and items that are never taxable or deductible.

The company''s current tax is calculated using the tax rates as prescribed in the section 115BAA of the Income Tax Act, 1961.

Deferred tax

Deferred tax liability or asset is recognized for timing differences between the profits/losses offered for income tax and profits/losses as per the financial statements. Deferred tax assets and liabilities are measured using the tax rates and tax laws that have been enacted or substantively enacted at the Balance Sheet date.

Deferred tax asset is recognized only to the extent there is reasonable certainty that the assets can be realized in future. However, where there is unabsorbed depreciation or carried forward loss under taxation laws, deferred tax asset on

such losses is recognized only if there is a virtual certainty of their realization. Deferred tax assets and liabilities are reviewed at each Balance Sheet date and written down or written up to reflect the amount that is reasonably/virtually certain to be realized.

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

n) Borrowing Cost

Borrowing costs to the extent related/attributable to the acquisition/construction of assets that takes substantial period of time to get ready for their intended use are capitalized along with the respective Property, Plant and Equipment up to the date such asset is ready for use. Other borrowing costs are recognised as expense in the Statement of Profit and Loss in the period in which they are incurred.

o) Earning Per Share Basic EPS

In determining earnings per share, the Company considers the net profit / (loss) after tax and includes the effect of extraordinary items in the profit and loss account. The number of shares used in computing basic earnings per share is the weighted average number of shares outstanding during the period. The weighted average number of equity shares outstanding during the period is adjusted for events such as bonus issue and issue of fresh equity shares under IPO that have changed the number of equity shares outstanding at the year end.

Diluted EPS

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

p) Investment

Investments that are readily realizable and intended to be held for not more than a year are classified as current investments. All other investments are classified as long-term investments. Current investments are carried at lower of cost and fair value determined on an individual investment

basis. Long-term investments are carried at cost. However, provision for diminution in value is made to recognize a decline other than temporary in the value of the investments.

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Mar 31, 2023

1 Corporate Information

Frog Cell sat Limited was originally incorporated in New Delhi as "Frog Cellsat Private Limited" on

July 12, 2004 under the Companies Act, 1956, vide certificate of incorporation issued by the registrar of companies, National Capital Territory of Delhi & Haryana. The company was subsequently converted into a public company and consequently the name was changed to "Frog Cellsat Limited" vide fresh certificate of incorporation dated March 25, 2014 issued by the registrar of companies, National Capital Territory of Delhi & Haryana. The company got listed on SME Platform of NSE during the financial year 2022-23 w.e.f. October 13, 2022. The company is MSME as per Udyam Reg. No. UDYAM-UP-28-0004879.

The company manufactures cost-effective in-building coverage solutions and mobile network accessories for mobile service providers and operators. The company caters to both domestic and international market. The company also provides installations, repair and maintenance services.

2 Summary of Significant Accounting Policies

a) Basis of Preparation of Financial Statements

The financial statements of the Company have been prepared in accordance with generally accepted accounting principles of India (Indian GAAP). The Company has prepared these financial statements to comply in all material respects with the accounting standards notified under section 133 of the Companies Act, 2013, read together with Rule 7 of the Companies (Accounts) Rules, 2014 and the relevant provisions of the Companies Act, 2013 (''the Act''). The financial statements have been prepared on an accrual basis and under the historical cost convention.

The accounting policies adopted in the preparation of financial statements are consistent with those of previous year unless otherwise disclosed.

b) Use of Estimates

The preparation of financial statements in conformity with Indian GAAP requires management to make estimates and assumptions that affect the application of accounting policies and reported amounts of assets, liabilities, revenues and expenses and disclosure of contingent assets and liabilities at the date of the financial statements. The estimates and assumptions used in the accompanying financial statements are based upon management''s evaluation of the relevant facts and circumstances as of the date of financial statements which in management''s opinion are

prudent and reasonable. Actual results may differ from the estimates used in preparing the accompanying financial statements. However, accounting estimates could change from period to period. Appropriate changes in estimates are made as the Management becomes aware of changes in circumstances surrounding the estimates. Any revision to accounting estimates is recognised prospectively in current and future periods and, if material, their effects are disclosed in the notes to the Standalone financial statements.

c) Functional and Presentation Currency

These financial statements are presented in Indian Rupees (''), the company''s functional currency. All Financial information presented in Indian Rupee has been rounded off to the nearest lakh as per the requirements of Schedule III of "the Act" unless otherwise stated.

d) Current-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:

i) It is expected to be realized in, or is intended for sale or consumption in, the Company''s normal operating cycle;

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

iii) It is expected to be realized within 12 months after the reporting date; or

iv) It is cash or cash equivalent 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.

Liabilities

A liability is classified as current when it satisfies any of the following criteria:

i) It is expected to be settled in the Company''s normal operating cycle;

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

iii) It is due to be settled within 12 months after the reporting date; or

iv) The Company does not have an unconditional right to defer settlement of the liability for at least 12 months after the reporting date.

Current liabilities include the current portion of non-current financial liabilities. All other liabilities are classified as non-current.

e) Operating Cycle

Operating cycle is the time between the acquisition of assets for processing and their realisation in cash and cash equivalents. Based on the above definition and nature of business, the company has ascertained its operating cycle as less than 12 months for the purpose of current/ non current classification of assets and liabilities.

f) Property, Plant and Equipment Intangible Assets & CWIP

Property, Plant and Equipment

Property, Plant and Equipment are stated at cost less accumulated depreciation. The total cost of assets comprises its purchase price, freight, duties, taxes and any other incidental expenses directly attributable to bringing the asset to the working condition for its intended use and interest on loans attributable to the acquisition of assets up to the date of commissioning of assets.

Subsequent costs related to an item of property, plant and equipment are recognized as a separate asset, as appropriate, only when it is probable that future economic benefits associated with the item will flow to the Group and the cost of the item can be measured reliably. The carrying amount of any component accounted for as a separate asset is derecognized when replaced. All other repairs and maintenance are recognized in statement of profit and loss during the reporting period when they are incurred.

An item of property, plant and equipment is derecognized on disposal or when no future economic benefits are expected from its use or disposal. The gains or losses arising from de-recognition are measured as the difference between the net disposal proceeds and the carrying amount of the asset and are recognized in the statement of profit and loss when the asset is derecognized.

Intangible Assets

Intangible assets are recognized if it is probable that the future economic benefits that are attributable to the assets will flow to the Company and cost of the assets can be measured reliably. The cost of intangible assets comprises its purchase price,

including any duties and other taxes and any directly attributable expenditure on making the asset ready for its intended use.

An item of an intangible asset is de-recognized on disposal or when no future economic benefits are expected from its use or disposal. The gains or losses arising from de-recognition are measured as the difference between the net disposal proceeds and the carrying amount of the asset and are recognized in the statement of profit and loss when the asset is derecognized.

Subsequent costs related to intangible assets are recognised as a separate asset, as appropriate, only when it is probable that future economic benefits associated with the item will flow to the Group and the cost of the item can be measured reliably.

Capital Work In Progress

Capital work in progress are carried at cost, comprising direct cost, related incidental expenses during the construction period, attributable borrowing costs for the qualifying assets and other expenses incurred in connection with project implementation in so far as such expenses relate to the period prior to the commencement of commercial production. Advances given towards the construction of the capital asset outstanding at each balance sheet date are disclosed as capital advances under long term loans and advances.

g) Depreciation and Amortisation

Depreciation on Property, Plant and Equipment is provided on written down value method at the rates arrived at on the basis of the estimated economic useful life of the assets. The useful life for building, plant & machinery & leasehold improvements is considered as prescribed in Schedule II of the Companies Act, 2013, representing the management''s estimate of the useful life of these assets and following consistency with previous year.

Amortization of the intangible asset begins when the asset is acquired and is available for use. It is amortized over the period of expected future benefit. Amortization expense is recognized in the statement of profit and loss unless such expenditure forms part of the carrying value of another asset. The estimated useful life of the intangible assets, amortization method and the amortization period are reviewed at the end of each financial year. Intangible assets are amortized with a finite useful life using the Written down value method.

Property, Plant and Equipment	Useful life	Schedule II
Property, Plant and Equipment
Building	30 years	30 years
Plant & Machinery	15 years	15 years
Furniture & Fixtures	10 years	10 years
Leasehold Improvement	10 years	10 years
Office Equipment	5 years	5 years
Computers and peripherals	3 Years	3 Years
Office Vehicle	8 years	8 years
Intangible Assets
Software	3/6 years based on the	6 years
	life of the software/
	license

The company''s computer software has an estimated useful life of three years as its licence is renewed after every three years.

The company has estimated residual value of the assets to be 5% of the cost of the asset.

h) Revenue Recognition

Revenue is recognized to the extent that it is probable that the economic benefits will flow to the Company and the revenue can be reliably measured.

Sale ofgoods

Revenue from sale of goods is recognized on transfer of all significant risks and rewards related to the ownership of such goods to the buyer. Sales are stated net of trade discount, sales return, duties and GST. Revenue is recognized only when it can be reliably measured and it is reasonable to expect ultimate collection.

Sale of service

Revenue is recognized based on contractual terms and ratably over the period in which services are rendered. Revenue from the end of the last billing to the Balance Sheet date is recognized as unbilled revenues. Revenue from fixed-price and fixed-timeframe contracts, where there is no uncertainty as to measurement or collectability of consideration, is recognized based upon the percentage-of-completion method.

Interest income

Interest income is recognized on time proportion basis on interest rates implicit in the transaction.

Dividend Income

Dividend income is recognised on receipt basis. Other Income

Other income is recognized based on the contractual obligations on accrual basis.

Lease rentals are recognised on a straight line basis over the period of lease.

Other Operating Revenue

Export incentives, production linked incentives and subsidies are recognized when there is reasonable assurance that the Company is complying with the conditions and the incentive will be received.

i) Inventories

Inventories are valued at cost or net realisable value, whichever is lower. Cost comprises of all costs of purchase, costs of conversion and other costs incurred in bringing the inventories to their present location and condition and is determined on weighted average method. Net Realizable Value is the estimated selling price in the ordinary course of business less estimated cost of completion and the estimated cost necessary to make the sale.

Raw materials, components, stores and spares are valued at lower of cost and net realizable value. However, materials and other items held for use in production of inventories are not written down below cost if the finished products in which they will be incorporated are expected to be sold at or above cost. Cost of raw materials, components and stores and spares is determined on weighted average basis.

Work in progress and finished goods are valued at lower of cost and net realizable value. Cost includes direct material and labour and a proportion of manufacturing overheads based on normal operating capacity. Cost is determined on weighted average basis.

j) Foreign Currency Transactions Initial recognition

Foreign currency transactions are recorded in the reporting currency which is Indian Rupee, by applying to the foreign currency amount the exchange rate between the reporting currency and the foreign currency at the date of the transaction.

Conversion

Monetary assets and liabilities in foreign currency, which are outstanding as at the year-end, are revalued at the year-end at the closing exchange rate and the resultant exchange differences are recognized in the Statement of Profit and Loss at the year end.

Exchange Differences

All exchange differences are recognized as income or as expenses in the period in which they arise.

k) Retirement and other employee benefits

The Company''s obligation towards various employee benefits has been recognised as follows:

Short term employee benefit

All employee benefits payable wholly within twelve months of rendering the service are classified as short-term employee benefits. Short term employee benefit obligations are expensed when the related services are provided. Liabilities for wages and salaries, including non-monetary benefits that are expected to be settled wholly within twelve months after the end of the period in which the employees render the related service are recognized in respect of employees'' services up to the end of the reporting period.

Defined contribution plans

The company''s contributions to the Provident Fund and Employee State Insurance are charged to the Statement of Profit and Loss of the year when the contributions to the respective funds are due. Both the employee and the employer make monthly contributions to the plan at a predetermined rate of the employee''s basic salary. These contributions are made to the fund administered and managed by the government of India.

Post Employment Benefits

Defined benefits plans

The company operates two defined benefit plans for its employees: gratuity and leave encashment. The cost of providing benefits under these plans is determined on the basis of actuarial valuation, carried out by an independent actuary, at each year-end. A separate actuarial valuation is carried out for each plan using the projected unit credit method which recognizes each period of service as giving rise to an additional unit of employee benefit entitlement and measures each unit separately to build up the final obligation. Actuarial losses and gain for both defined benefit plans are recognised in full in the period in which they occur in the statement of profit and loss.

The Company''s gratuity benefit scheme is a defined benefit plan. The Company''s net obligation in respect of the gratuity benefit scheme is calculated by estimating the amount of future benefit that employees have earned in return for their service in the current and prior periods; that benefit is discounted to determine its present value, and the fair value of any plan assets is deducted. The Company provides for the Gratuity Plan based on projection valuations in accordance with Accounting Standard 15 (Revised), "Employee Benefits".

The employees of the Company are entitled to compensated absences which are both accumulating and non-accumulating in nature. The expected cost of accumulating compensated absences is determined on the additional amount expected to be paid / availed as a result of the unused entitlement that has accumulated at the Balance Sheet date. Expense on non-accumulating compensated absences is recognized in the period in which the absences occur.

The obligation is measured at the present value of the estimated future cash flows. The discount rates used for determining the present value of the obligation under defined benefit plan are based on the market yields on Government Securities as at the Balance Sheet date.

Actuarial gains and losses comprise experience adjustments and the effects of changes in actuarial assumptions and are recognized immediately in the Statement of Profit and Loss.

l) Leases

Operating lease: Leases where the lessor effectively retains substantially all the risks and benefits of ownership of the leased item, are classified as operating lease. Payments made under cancellable operating leases are charged to the Profit & loss Account on a straight line basis over the period of lease.

Finance lease: Principal amount of the finance lease is capitalized and depreciated accordingly. Finance charges are charged to Profit & Loss Account over the period of the lease. Finance lease, which effectively transfers to the company substantially all the risks and benefits incidental to ownership of the leased item, are capitalised at the lower of fair value and present value of the minimum lease payments at the inception of the lease term and disclosed as leased assets. Finance charges are recognised as finance cost in statement of profit and loss account.

m) Taxation

Income-tax expense comprises current tax and deferred tax.

Current tax

Provision for current tax is made for the tax liability payable on taxable income after considering tax allowances, deductions and exemptions determined in accordance with the prevailing tax laws. The tax currently payable is based on taxable profit for the year. Taxable profit differs from ''profit before tax'' as reported in the statement of profit and loss because of items of income or expense that are taxable or deductible in other years and items that are never taxable or deductible.

The company''s current tax is calculated using the tax rates as prescribed in the section 115BAA of the Income Tax Act, 1961.

Deferred tax

Deferred tax liability or asset is recognized for timing differences between the profits/losses offered for income tax and profits/losses as per the financial statements. Deferred tax assets and liabilities are measured using the tax rates and tax laws that have been enacted or substantively enacted at the Balance Sheet date.

Deferred tax asset is recognized only to the extent there is reasonable certainty that the assets can be realized in future. However, where there is unabsorbed depreciation or carried forward loss under taxation laws, deferred tax asset on such losses is recognized only if there is a virtual certainty of their realization. Deferred tax assets and liabilities are reviewed at each Balance Sheet date and written down or written up to reflect the amount that is reasonably/virtually certain to be realized.

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

n) Borrowing Cost

Borrowing costs to the extent related/attributable to the acquisition/construction of assets that takes substantial period of time to get ready for their intended use are capitalized along with the respective Property, Plant and Equipment up to the

date such asset is ready for use. Other borrowing costs are recognised as expense in the Statement of Profit and Loss in the period in which they are incurred.

p) Earning Per Share Basic EPS

In determining earnings per share, the Company considers the net profit / (loss) after tax and includes the effect of extraordinary items in the profit and loss account. The number of shares used in computing basic earnings per share is the weighted average number of shares outstanding during the period. The weighted average number of equity shares outstanding during the period is adjusted for events such as bonus issue and issue of fresh equity shares under IPO that have changed the number of equity shares outstanding at the year end.

Diluted EPS

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

q) Investment

Investments that are readily realizable and intended to be held for not more than a year are classified as current investments. All other investments are classified as long-term investments. Current investments are carried at lower of cost and fair value determined on an individual investment basis. Long-term investments are carried at cost. However, provision for diminution in value is made to recognize a decline other than temporary in the value of the investments.

r) Provisions, Contingent Liabilities and Contingent Assets

Provisions: A provision is recognized when an enterprise has a present obligation as a result of past event 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 values and are determined based on management estimates of the obligation required to settle at the Balance Sheet date. These are reviewed at each Balance Sheet date and adjusted to reflect the current management estimates.

Provision for warranties: The estimated liability for product warranties is recognised when products are sold. These estimates are established using historical information based on the nature, frequency and average cost of warranty claims and management estimates regarding possible future incidence based on corrective actions on product failures. The timing of outflows will vary as and when warranty claim will arise. The company accounts for the provision for warranties on the basis of information available to the management duly taking into account the current and past technical estimates.

Contingent Liabilities: Contingent liabilities are disclosed in respect of possible obligations that have arisen from past events and the existence of which will be confirmed only by the occurrence or non-occurrence of future events not wholly within the control of the Company.

When there is an obligation in respect of which the likelihood of outflow of resources is remote, no provision or disclosure is made.

Contingent assets: Contingent assets are not disclosed in the financial statement unless an inflow of economic benefit is probable.

s) Cash and Cash Equivalents

Cash and Cash Equivalents in the balance sheet comprise cash at banks, cash in hand, term deposits, and fixed deposits kept as security/ margin money for more than 3 months but less than 12 months. For the purpose of the statement of cash flows, cash and cash equivalents consist of cash in hand, bank balances in current accounts and bank deposits, as defined above, as they are considered an integral part of the Company''s cash management. The deposits maintained by the Company with banks comprise of deposits, which can be withdrawn by the Company at any point without prior notice or penalty on the principal.

t) Government Grants and Production Linked Incentives

Government grants: Government grants are recognised where there is reasonable assurance that the grant will be received and all attached conditions will be complied with. Where the grant relates to an asset the cost of the asset is shown at gross value and grant thereon is treated as capital grant. The capital grant will be recognised as income in the statement of profit and loss over the period and in proportion in which depreciation is charged. Revenue grants are recognised in the statement of profit and loss in the same period

as the related cost, which they are intended to compensate are accounted for.''

Production Linked Incentive: Production Linked Incentives are recognised as income when, on the basis of the judgment of the management and based on the supporting data with respect to the eligibility conditions, the Company fulfils the eligibility conditions as per the approval letter. The management applies its judgement for the recognition of incentive income based on the management''s assessment for likelihood of recoverability.

u) Impairment of Assets

The Management periodically assesses, using external and internal sources, whether there is an indication that an asset may be impaired. An impairment loss is recognized wherever the carrying value of an asset exceeds its recoverable amount. The recoverable amount is the higher of the asset''s net selling price or value in use, which means the present value of future cash flows expected to arise from the continuing use of the asset and its eventual disposal. An impairment loss for an asset is reversed if, and only if, the reversal can be related objectively to an event occurring after the impairment loss was recognized. The carrying amount of an asset is increased to its revised recoverable amount, provided that this amount does not exceed the carrying amount that would have been determined (net of any accumulated amortization or depreciation) had no impairment loss been recognized for the asset in prior years.

v) Research and Development Expenditure

Research and development expenditure that do not meet the criteria for the recognition of intangible assets are recognised as an expense as incurred. Development costs previously recognised as an expense are not recognised as an asset in a subsequent period.

w) Subsequent Expenditure

Subsequent expenditure is recognised only if it is probable that the future economic benefits associated with the expenditure will flow to the Company and the cost of the item can be measured reliably.

x) Cash Flow Statement

Cash flows are reported using the indirect method as per Accounting Standard 3, Cash Flow Statements, whereby profit for the period 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 the operating, investing and financing activities of the company are segregated. The company considers all highly liquid investments that are readily convertible to known amounts of cash to be cash equivalents.

xi) Investment in subsidiary

The company has invested in two subsidiaries which are carried in the books of accounts at cost. On disposal of investments in subsidiaries, the difference between net disposal proceeds and the carrying amounts are recognized in the Statement of Profit and Loss.