Notes to Accounts of Innovision Ltd.

Mar 31, 2024

4 Leases

Tlie Company has adopted Ind AS 116 Leases with the date of initial application being 01-Apr-2020. The Company has used modified retrospective approach under Ind AS 116, under which the Company recognises a right-of-use asset and a corresponding lease liability with respect to all lease agreements in which it is the lessee, except for short-term leases (defined as leases with a lease term of 12 months or less) and leases of low value assets. The Company enters into an arrangement for lease of buildings. Lease of building generally have lease terms between 3 and 10 years.

The Company has discounted lease payments using the applicable incremental borrowing rate as on the proforma transition date, which is 8.25 % for measuring the lease liability.

Some leases of office buildings contain extension options exercisable by the Company upto one year before the end of the non-cancellable contract period. Where practicable, the Company seeks to include extension options in new leases to provide operational flexibility. The extension options held are exercisable only by the Company and not by the lessors.

(a) There are no outstanding receivables due from directors or other officers of the Company.

(b) For disclosures related to credit risk, impairment of trade receivables under expected credit loss model and related disclosures refer note 39.

(c) Due to the nature of the business,i.e manpower services or cash business, the company has till the date won all the cases for recovery of debts, it is of the opinion that even long term outstandings or disputed debts will eventually realize and accordingly no expected credit loss has been made.

Company has not created any expected credit loss for long term & disputed dues due to nature of business i.e. Manpower Services. The Company has won all the cases of recovery of debts till date.

A Terms and rights attached to shares

The Company lias only one class of equity shares, having a par value of ? 10/-. Each holder of equity shares is entitled to one vote per share. The Company declares and pays dividend in Indian rupees. The Dividend proposed by Board of Directors is subject to approval by the shareholders at the Annual General Meeting. In the event of liquidation of the Company, the holders of the equity shares are entitled to receive only residual assets of the Company. The distribution will be in proportion to number of equity shares held by the shareholders.

E Aggregate number of bonus shares issued, shares bought back and share issued for consideration other than cash during the period of five years immediately

preceding the reporting date:

1. The Company has not issued any shares for consideration other than cash during the current year (March 31, 2024: Nil shares; March 31 2023- Nil shares'' March 31 20"’2-

Nil). ’

2. During the year, the Company issued bonus shares in proportion of 13 (thirteen) new fully paid-up bonus equity shares of ? 10.00 each for every 1 (One) existing fully paid-up equity shares of ? 10.00 each held by the Members.

3. The Company has not bought back shares during the period of five years immediately preceding the reporting date.

(a) Retained earnings represent the amount of accumulated earnings / deficit of the Company. The amount that can be distributed by the Company as dividends to its equity shareholders is determined based on the separate financial statements of the Company and also considering the requirements of the Companies Act, 2013. Thus, the amounts reported above are not distributable in entirety. Remeasurement gain/(loss) - net on defined benefit plans & fair value gain on investment property March 31, 2024 (INR (1.14) million & INR 14.35 million), March 31, 2023 (INR 5.79 million & INR 0) has been recognised during the year as part of retained earnings.

Secured Borrowings

(a) Vehicle loan of INR 10.60 millions is secured against that vehicle carrying rate of interest of 9.1% pa, starting from 5th March 2024 and having a tenure of 60 months.

(b) Vehicle loan of INR 27.18 millions is secured against that vehicle carrying rate of interest of 8.65% pa, starting from 30th June 2023 and having a tenure of 84 months.

(c) Vehicle loan of INR 0.67 millions is secured against that vehicle carrying rate of interest of 10.1% pa, starting from 27th Jan 2024 and having a tenure of 60 months.

(d) Vehicle loan of INR 3.22 millions is secured against that vehicle carrying rate of interest of 7.7% pa, starting from 23rd April 2021 and having a tenure of 84 months.

(e) Vehicle loan of INR 2.11 millions is secured against that vehicle carrying rate of interest of 7% pa, starting from 15th December 2021 and having a tenure of 60 months.

(f) Vehicle loan of 1NR 0.15 millions is secured against that vehicle carrying rate of interest of 9.1% pa, starting from 20th December 2019 and having a tenure of 60 months.

(g) Vehicle loan of INR 0.39 millions is secured against that vehicle carrying rate of interest of 8% pa, starting from 2nd December 2020 and having a tenure of 60 months.

(h) Guaranteed Emergency Credit Line (GECL) limit of INR 27.00 millions out of which INR 16.42 millions utilized*

(i) Guaranteed Emergency Credit Line (GECL extension) limit of INR 18.50 millions out of which INR 6.49 millions utilized*

(i) SBICC limit of INR 240.00 millions (divided into USD currency equavalent INR 200.00 millions and INR currency INR 40.00 millions) out of which INR 222.85 millions utilized secured by first charges FDR''s, trade receivables & current assets.

(j) HDFC CC limit of INR 150.00 millions out of which INR 108.28 millions utilized secured by first charges FDR''s, trade receivables & current assets. Unsecured Borrowings

(a) Term Loan of INR 5.20 millions having rate of interest of 16% p.a. starting on 21st January 2023 and having tenure of 36 months.

(b) Term Loan of INR 6.60 millions having rate of interest of 14% p.a. starting on 18th November 2023 and having tenure of 36 months.

(c) Term Loan of INR 8.83 millions having rate of interest of 15% p.a. starting on 5th November 2023 and having tenure of 36 months.

(d) Term Loan of INR 2.90 millions having rate of interest of 16% p.a. starting on 21st March 2023 and having tenure of 24 months, taken for toll division.

(e) Term Loan of INR 6.92 millions having rate of interest of 16% p.a. starting on 20th January 2023 and having tenure of 36 months, taken for toll

division.

(f) Term Loan of INR 6.03 millions having rate of interest of 16% p.a. starting on 22nd May 2023 and having tenure of 36 months, taken for toll division.

(g) Term Loan of INR 3.98 millions having rate of interest of 16% p.a. starting on 15th May 2023 and having tenure of 36 months, taken for toll division.

(h) Term Loan of INR 5.98 millions having rate of interest of 16% p.a. starting on 15th May 2023 and having tenure of 37 months, taken for toll division.

(i) Term Loan of INR 3.97 millions having rate of interest of 16% p.a. starting on 22nd May 2023 and having tenure of 36 months, taken for toll division.

(j) Tenn Loan of INR 5.96 millions having rate of interest of 16% p.a. starting on 19th May 2023 and having tenure of 36 months, taken for toll division.

C Unsatisfied performance obligations at the end of reporting period

The remaining performance obligation disclosure provides the aggregate amount of the transaction price yet to be recognised as at the end of the reporting period and an explanation as to when the Company expects to recognise these amounts in revenue. Applying the practical expedient as given in Ind AS 115, the Company has not disclosed the remaining performance obligation since the revenue recognised corresponds to contracts that are entered for a period of 1 year or less.

(b) Corporate Social Responsibility

As per Section 135 of the Companies Act, 2013, a Company, meeting the applicability threshold need to spend at least 2% of its average net profits for the immediately preceding three financial years on Corporate social responsibility (CSR) activities. The areas for CSR activities are eradication of hunger and malnutrition, promoting education, art and culture, healthcare, destitute care and rehabilitation, environment sustainability, disaster relief and rural development projects. A CSR committee has been formed by the Group as per the Act.

Woke India Foundation (Section 8 Company) is a subsidiary of Innovision Limited is a related party. For the year ending March 31, 2024, the Company has made contributions to Woke India Foundation to fulfil its corporate social responsibilities. Woke India Foundation supports, promote, channelise, undertake charitable work irrespective of caste, religion, community and economic status essentially for philanthropic purposes.

# Case under the Negeotiable Instrument Act, 1881 was pending against the Company by a vendor due to stop payment of cheque amounting INR 0.88 millions. The same has been settled & the amount of INR 0.90 million paid on 9th July, 2024 vide. UTR number: SBIN124191881497. As per the communication received from the management, the application for withdrawn the case has been filed by the vendor.

* There are various instances of delay in depositing the Provident Fund during the year and the interest liability on the delay payment has not been paid and for which no provision has been made.

36 Litigations

1. Trade receivables of INR 73.82 millions, INR 75.14 millions for FY 2023-24 and FY 2022-23 respectively (refer note 10 c) are under litigation for which the Company has not made expected credit loss.

2. Security deposits of INR 0.26 millions, Nil for FY 2023-24 and FY 2022-23 respectively are under litigation for which the company has not made expected credit loss.

3. The pending proceedings for admittance against the Company unde the provisions of Insolvency & Bankruptcy Code, 2016 with Hon''able NCLT, Delhi Bench has been dismissed by the tribunal vide, order dated 9th July 2024.

37 Employee benefits

A Defined contribution plans

The Company participates in a number of defined contribution plans for employees. Any expense recognised in relation to these schemes represents the value of contributions payable during the period by the Company at rates specified by the rules of those plans. The Company makes provident fund contributions which are defined contribution plans for qualifying employees.

(a) Provident fund

The Company provides provident fund benefits for eligible employees as per applicable regulations wherein both employees and the Company make monthly contributions at a specified percentage of the eligible employee’s salary.

B Defined benefit plans Gratuity

The gratuity plan is governed by the Payment of Gratuity Act, 1972. Under the act, employee who has completed five years of service is entitled to specific benefit. The level of benefits provided depends on the member’s length of service and salary at retirement age.

Gratuity is a defined benefit plan and entity is exposed to the following risks:

(i) Interest rate risk: A fall in the discount rate will increase the present value of the liability requiring higher provision.

(ii) Salary risk: The present value of the defined benefit plan liability is calculated by reference to the future salaries of members. As such, an increase in the salary of the members more than assumed level will increase the plan''s liability.

(iii) Mortality risk: Since the benefits under the plan is not payable for life time and payable till retirement age only, plan does not have any longevity risk.

38 First time adoption of Ind AS

As stated in Note 2, these financial statements for the year ended 31 March 2024 are the first financial statements prepared in accordance with Ind AS. For periods up to and including the year ended 31 March 2023, the Company prepared its financial statements in accordance with accounting standards notified under section 133 of the Companies Act, 2013 and other provisions of the Act. (Previous GAAP).

Accordingly, the Company has prepared financial statements which comply with Ind AS applicable for periods ending on 31 March 2024, together with the comparative period data as at and for the year ended 31 March 2023, as described in the summary of significant accounting policies. In preparing these financial statements, the Company''s opening balance sheet was prepared as at 1 April 2022, the Company’s date of transition to Ind AS.

This note explains exemptions availed by the Company in restating its Previous GAAP financial statements, including the balance sheet as at 1 April 2022 and the financial statements as at and for the year ended 31 March 2023.

I. Ind AS Mandatory exceptions applied:

a) Estimates

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

Ind AS estimates as at 1 April 2022 and 31 March 2023 are consistent with the estimates as at the same date made in confirmity with the previous GAAP.

b) Classification and measurement of financial assets

Ind AS 101 requires an entity to assess the classification and measurement of financial assets on the basis of facts and circumstances that exists at the date of transition to Ind AS. Further, the standard permits measurement of financial assets accounted at amortised cost based on the facts and circumstances existing at the date of transition to Ind AS if retrospective application is impracticable.

Accordingly, the Company has determined the classification and measurement of financial assets at amortised cost based on the facts and circumstances that exist as on the date of transition.

c) De-recognition of financial assets and liabilities

Ind AS 101 requires an entity to apply de- recognition provisions of Ind AS prospectively for the transactions occuring on or after the date of transition to Ind AS. However, Ind AS 101 allows an entity to apply the de-recognition requirements in Ind AS 109 retrospectively from a date of the entity''s choosing, provided that the information needed to apply Ind AS 109 to financial assets and financial liabilities derecognised as a result of past transactions was obtained at the time of initially accoutning for those transactions.

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

d) Impairment of financial assets

At the date of transition to Ind AS, the Company has determined that there is no increase in credit risk since the initial recognition of a financial instrument.

II. Ind AS optional exemption applied:

Set out below are the applicable Ind AS 101 optional exemptions and mandatory exceptions applied in the transition from previous GAAP to Ind AS. a) Deemed cost

Ind AS 101 pennits a first- time adopter to elect to continue with the carrying value for all of its property, plant and equipment and intangible assets as recognised in the financial statements as at the date of transition to Ind AS, measured as per the previous GAAP and use that as its deemed cost as at the date of transition. Accordingly, the Company has elected to measure all its property, plant and equipment and intangible assets at the previous GAAP carrying amount as its deemed cost on the date of transition to Ind AS.

39 Financial instrument - Accounting, Classification and Fair Values

This section gives an overview of the significance of financial instrmnents for the Company and provides additional information on balance sheet items that contain financial instruments. The details of significant accounting policies, including the criteria for recognition, basis of measurement and the basis on which income and expenses are recognised in respect of each class of financial asset, financial liability and equity instrument are disclosed in accounting policies fonning the part of the standalone financial statements.

(b) Fair value hierarchy

Financial instruments that are measured subsequent to initial recognition at fair value, grouped into Level 1 to Level 3, as described below:

Quoted prices in an active market (Level 1): This level of hierarchy includes financial assets that are measured by reference to quoted prices (unadjusted) in active markets for identical assets or liabilities. The Company does not have any financial instrument which have been measured using the valuation techniques as per level 1 for the financial year 2023-24.

Valuation techniques with observable inputs (Level 2): This level of hierarchy includes financial assets and liabilities, measured using inputs (other than quoted prices included within Level 1) that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e., derived from prices). The Company does not have any financial instrument which have been measured using the valuation techniques as per level 2.

Valuation techniques with significant unobservable inputs (Level 3): This level of hierarchy includes financial assets and liabilities measured using inputs that are not based on observable market data (unobservable inputs). Fair value is determined in whole or in part, using a valuation model based on assumptions that are neither supported by prices from observable current market transactions in the same instrument nor are they based on available market data. The Company have equity investments which is measured using the valuation techniques as per level 3.

(i) Tire fair value of Other financial assets, cash and cash equivalents, trade receivables, loans and advances, trade payables and other financial liabilities approximate their carrying amount largely due to the short-term nature of these instruments.

(ii) Management uses its best judgement in estimating the fair value of its financial instruments. However, there are inherent limitations in any estimation technique. Therefore, for substantially all financial instruments, the fair value estimates presented above are not necessarily indicative of the amounts that the Company could have realised or paid in sale transactions as of respective dates. As such, fair value of financial instruments subsequent to the reporting dates may be different from the amounts reported at each reporting date.

(iii) There have been no transfers between Level 1 and Level 2 and Level 3 during the reporting period.

(c) Capital Management

The Company’s objectives when managing capital is to safeguard continuity, maintain a strong credit rating and healthy capital ratios in order to support its business and provide adequate return to shareholders through continuing growth. The Company’s overall strategy remains unchanged from previous year.

The Company sets the amount of capital required on the basis of annual business and long-tenn operating plans which include capital and other strategic investments.

The funding requirements are met through a mixture of equity, unsecured perpetual securities, internal fund generation and other long tenn borrowings. Hie Company monitors capital and long tenn debt on the basis of debt to equity ratio.

The Company believes that it will able to meet all its current liabilities and interest obligations in timely manner.

The Company''s capital management ensure that it meets financial covenants attached to the interest bearing loans and borrowings that define capital structure requirements. Breaches in meeting the financial covenants would permit the bank to levy penal interest as per terms of sanction. There have been no breaches in the financial covenants of any interest bearing loans and borrowings in the current year. No changes were made in the objectives, policies or processes for managing capital by the Company.

(d) Financial risk management objectives and policies

The Company’s principal financial liabilities comprises of trade payables, merchant settlement liabilities and other payables. The Company’s principal financial assets include loans, trade and other receivables, and cash that derive directly from its operations.

The Company is exposed to the following risks from its use of financial instruments:

(i) Credit risk

(ii) Liquidity risk

(iii) Market risk

(iv) Foreign currency exchange rate risk

(v) Interest rate risk

(vi) Other Price Risk

The Company’s Board of Directors has the overall responsibility for the establishment and oversight of the Company''s risk management framework. This note presents information about the risks associated with its financial instruments, the Group’s objectives, policies and processes for measuring and managing risk.

(i) Credit risk

Credit risk is defined the risk that a counterparty will not meet its obligations under a financial instrument or customer contract, leading to a financial loss. Credit risk arises St< from the Company’s exposures to third parties (trade receivables), including cash and cash equivalents, loans, derivative financial instruments and deposits with banks and other financial assets.

Trade receivables

The Company’s credit risk associated with trade receivable is primarily related to customers not able to settle their obligation as agreed upon. The impairment provision for financial assets disclosed above are based on assumptions about risk of default and expected loss rates. The Company uses judgment in making these assumptions and selecting the inputs to the impainnent calculation, based on the Company’s past history and existing market conditions. The Company estimates loss arising on trade receivables as a percentage of sales based on past trends and such loss is directly debited to revenue instead of creating a provision for impairment of receivables.

For the years ended 31 March 2024, 31 March 2023 and 1 April 2022, the Company had no customer that accounted for greater than 10% of total net revenue. Further till 31 st March 2024 the Company has not booked any bad debts and due to the nature of business, the Company is of the belief that it will be able to realize all its dues.

Financial instruments and cash

Credit risk from balances with banks and financial institutions is managed by the Company’s treasury department in accordance with the Company’s policy. Surplus funds are invested in bank fixed deposits or used to temporarily reduce the balance of cash credit accounts to optimize interest costs.

(ii) Liquidity risk

Liquidity risk is defined as the risk that the Company will not be able to settle or meet its obligations on time or at reasonable price. The Company’s objective is to at all times maintain optimum levels of liquidity to meet its cash and liquidity requirements. The Company closely monitors its liquidity position and maintains adequate source of financing through the use of short term bank deposits, demand loans and cash credit facility. Processes and policies related to such risks are overseen by senior management.

(Hi) Market risk

Market risk is the risk of any loss in future earnings, in realisable fair values or in future cash flows that may result from a change in the price of a financial instrument. The value of a financial instrument may change as a result of changes in interest rates, foreign currency exchange rates, equity price fluctuations, liquidity and other market changes. Future specific market movements cannot be normally predicted with reasonable accuracy.

(iv) Foreign currency exchange rate risk

The Indian Rupee is the Company’s most significant currency. As a consequence, the Company’s financials are presented in Indian Rupee and exposures are managed against Indian Rupee accordingly. Foreign currency risk is the risk that the fair value or future cash flows of an exposure will fluctuate because of changes in foreign exchange rates. The Company is exposed to currency risk on account of borrowings.

(v) Interest rate risk

The Company’s fixed deposits are carried at fixed rate. Therefore not subject to interest rate risk as defined in Ind AS 107, since neither the carrying amount nor the future cash flows will fluctuate because of a change in market interest rates.

(vi) Other Price Risk

The Company has non-marketable equity investments in privately-held companies for putposes other than trading. These investments are inherently risky because there is no established market for these securities and the markets for the technologies or products these companies are developing are typically in the early stages. As such, we could lose our entire investment in these companies. As of 31 March 2024, the aggregate carrying value of our non-marketable equity investments is INR .15 Million. Value of the investment is not significant for the company.

(c) Additional Regulatory Information

(i) The Company has not been declared a wilful defaulter by any bank or financial institution or other lende

(ii) The Company has not advanced or loaned or invested funds (either borrowed funds or share premium or any other sources or kind of foods) to any other person(s) or entity(ies) including foreign entities flnteimedianes) with the undemanding (whether recorded in writing or olhnwisc) that the Intennediaiy shall (a) directly or indirectly lend or invest in other persons or

” “^{y Wtats}“^,“ hy « °» hehaif of the company (Ultimate Benelicimies) or (b) previde any guamntee, security o, the like to or on behalf of the Ul.im.r,

Ctu) The Company has not received ap,fond firm, any pemon(3) or entity(is»), including foreignentities (Funding Part,) with the understanding (whether iccunM in writing or otherwise) that the company shall (a) dncctly or mdnectly lend or revest in other persons or entities identified in any manner whatsoever by or on behalf of the Funding Party (Ultimate Beneficiaries) or (b) provide any guarantee, security or the like ou bebalf of the Ultimate Beoeficiarie ^{3 K 3}

(vi) Hie Company has not traded or invested in crypto currency or virtual currency during the current or previous y«

(d) The Code on Social Security, 2020 (‘Code’) relating to employee benefits during employment and post-emplovmertl benefits received Presidential assent in September 2020. The Code has been published in the Gazette of India. However, the date on which the Code will come into effect has not been notified. The Company will assess the impact of the Code when it comes into effect and will record any related impact in the period the Code becomes effective.

(e) The standalone financial statements of the Company for the year ended March 31,2023. were audited by the Rajiv Mehta & Associates Chartered Accountants (Firm''s registration no 017137N), Chartered Accountants, the predecessor auditor.

(f) No Transactions with Struck-off companies during the year