Accounting Policies of KFIN Technologies Ltd. Company

Mar 31, 2025

2. Summary of Material Accounting
Policies

A) Basis of preparation and measurement of
Standalone Financial Statements

The Standalone Balance Sheet of the Company as
at 31 March 2025, the related Standalone Statement
of Profit and Loss (including Other Comprehensive
Income), the Standalone Statement of Changes
in Equity, and the Standalone Statement of
Cash Flows for the year ended 31 March 2025
and the Significant accounting policies and
Other Financial Information (together referred
to as '' Standalone Financial Statements'') have
been prepared in accordance with the Indian
Accounting Standards (Ind AS) notified under
Section 133 of the Companies Act, 2013 ("the
Act") read with Rule 3 of the Companies (Indian
Accounting Standards) Rules, 2015 (as amended
from time to time) presentation requirements of
Division II of Schedule III to the Companies Act,
2013, (Ind AS compliant Schedule III), as applicable
to the Standalone Financial Statements.

The Standalone Financial statements have been
prepared on a going concern basis. The accounting
policies are applied consistently to all the periods
presented in the Standalone Financial Statements.

The Standalone Financial Statements have been
prepared under the historical cost convention on
accrual basis except for the following items:

• Defined benefit liability/(assets): fair value
of plan assets less present value of defined
benefit obligation

• Certain financial assets and liabilities that are
measured at fair value or amortised value

The Standalone Financial Statements were
authorised for issue by the Board of Directors on
28 April 2025.

Functional and presentation currency

These Standalone Financial Statements are
presented in Indian Rupees (''INR''), which is the
Company''s functional currency. All amounts have
been rounded to the nearest millions, unless
otherwise stated.

Fair value measurement

Fair value is the price that would be received
from sale of an asset or paid to transfer a
liability in an orderly transaction between market
participants at the measurement date. The fair
value measurement is based on the presumption
that the transaction to sell the asset or transfer the
liability takes place either-

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

• In the absence of a principal market, in the most
advantageous market for the asset or liability

The principal or the most advantageous market
must be accessible to/ by the Company.

All assets and liabilities for which fair value is
measured or disclosed in the Standalone Financial
Statement are categorised within the fair value
hierarchy, described as follows, based on the
lowest level input that is significant to the fair value
measurement as a whole-

• Level 1: quoted prices (unadjusted) in active
markets for identical assets or liabilities.

• Level 2: inputs other than quoted prices included
in Level 1 that are observable for the asset or
liability, either directly (i.e. as prices) or indirectly
(i.e. derived from prices).

• Level 3: inputs for the asset or liability that
are not based on observable market data
(unobservable inputs).

The Company''s CFO determines the appropriate
valuation techniques and inputs for fair value
measurements. When measuring the fair value
of an asset or a liability, the Company uses
observable market data as far as possible. If the
inputs used to measure the fair value of an asset

or a liability fall into different levels of the fair value
hierarchy, then the fair value measurement is
categorized in its entirety in the same level of the
fair value hierarchy as the lowest level input that
is significant to the entire measurement. Where
Level 1 inputs are not available, the Company
engages third party qualified valuers to perform
the valuation. Any change in the fair value of each
asset and liability is also compared with relevant
external sources to determine whether the change
is reasonable.

For changes that have occurred between levels
in the hierarchy during the year the Company
re-assesses categorisation (based on the lowest
level input that is significant to the fair value
measurement as a whole) at the end of each
reporting period.

Use of judgments and estimates

In preparing these Standalone Financial
Statements, management has made judgments,
estimates and assumptions that affect the
application of the Company''s accounting policies
and the reported amounts of assets, liabilities,
income and expenses. Management believes
that the estimates used in the preparation of the
Standalone Financial Statements are prudent
and reasonable. Actual results may differ from
these estimates.

Estimates and underlying assumptions are
reviewed on an ongoing basis. Revisions to
estimates are recognised prospectively.

Changes in estimates are reflected in the financial
estimates in the period in which changes are
made and if material, their effects are disclosed in
the notes to the Standalone Financial Statements.

a) Judgements

Information about the judgments made in
applying accounting policies that have the
most significant effects on the amounts
recognised in the Standalone Financial
Statements have been given below:

• Note O - Classification of financial assets:
assessment of business model within
which the assets the assets are held and
assessment of whether the contractual
terms of the financial asset are solely
payments of principal and interest on the
principal amount outstanding.

• Note C - Lease classification and
identification of lease component

• Note F - Identification and recognition of
intangible assets under development

b) Assumptions and

estimation uncertainties

Information about assumptions and
estimation uncertainties that have a significant
risk of resulting in a material adjustment in the
Standalone Financial Statements for every
period ended is included below:

• Employee benefit plans

The cost of defined benefit plans and
the present value of the obligation are
determined using actuarial valuations.
An actuarial valuation involves making
various assumptions which may differ
from actual developments in the future.
These include the determination of the
discount rate, future salary increases and
mortality rates. However, any changes in
these assumptions may have impact on
the reported amount of obligation and
expenses (Refer Note J).

• Taxes

Uncertainties exist with respect to the
interpretation of complex tax regulations,
changes in tax laws, and the amount
and timing of future taxable income. The
Company establishes provisions, based
on reasonable estimates, for possible
consequences of assessment by the tax
authorities of the jurisdiction in which it
operates. The amount of such provisions
is based on various factors, such as
experience of previous tax assessment
and differing interpretations of tax laws
by the taxable entity and the responsible
tax authority. The Company assesses the
probability for litigation and subsequent
cash outflow with respect to taxes.

Deferred income tax assets are
recognised for all unused tax losses to
the extent that it is probable that taxable
profit will be available against which
the losses can be utilised. Significant
management judgment is required to
determine the amount of deferred tax
assets that can be recognised, based
upon the likely timing and the level of
future taxable profits together with future
tax planning strategies. (Refer Note P)

• Useful life and residual value of
property, plant and equipment and
intangible assets

The charge in respect of periodic
depreciation is derived after estimating

the asset''s expected useful life and the
expected residual value at the end of its
life. The depreciation method, useful lives
and residual values of Company''s assets
are estimated by Management at the
time the asset is acquired and reviewed
during each financial year. (Refer Note D
and E)

• Impairment of financial assets

Analysis of historical payment patterns,
customer concentrations, customer
credit-worthiness and current economic
trends. If the financial condition of
a customer deteriorates, additional
allowances may be required. (Refer Note
O)

• Provisions and contingencies

Assessments undertaken in recognizing
the provisions and contingencies have
been made as per the best judgment of
the management based on the current
available information. (Refer Note N)

• Fair value measurement of financial
instruments

When the fair value of financial assets
and financial liabilities recorded in the
Standalone Balance Sheet cannot be
derived from active markets, their fair
value is determined using valuation
techniques including the discounted
cash flow model. The inputs to these
models are taken from observable
markets where possible, but where this
is not feasible, a degree of judgments is
required in establishing fair values. The
judgments include considerations of
inputs such as liquidity risk, credit risk and
volatility. Changes in assumptions about
these factors could affect the reported
fair value of financial instruments. (Refer
Note O)

• Impairment of non-financial assets:
Key assumptions for discount rate,
growth rate, etc.

The determination of recoverable
amounts of the CGUs assessed in the
annual impairment test requires the
Company to estimate their fair value net
of disposal costs as well as their value-
in-use. The assessment of value-in-use
requires assumptions to be made with
respect to the operating cash flows of the

CGUs as well as the discount rates. (Refer
N ote H)

B) Classification of assets and liabilities as
current and non-current

The Company presents assets and liabilities in
the Standalone Balance Sheet based on current/
non-current classification. An asset is treated as
current when it is:

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

• Held primarily for the purpose of trading

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

• Cash and cash equivalents unless restricted
from being exchanged or used to settle a
liability for at least twelve months after the
reporting period

All other assets are classified as non-current.

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

A liability is treated as current when:

• It is expected to be settled in normal
operating cycle

• It is held primarily for the purpose of trading

• It is due to be settled within twelve months after
the reporting period, or

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

All other liabilities are classified as non-current.

Operating Cycle

The operating cycle is the time between the
acquisition of the assets for processing and their
realisation in cash and cash equivalents. The
Company has identified twelve months as its
operating cycle.

C) Leases

The lease standard Ind AS 116 was notified to be
effective w.e.f. 1 April 2019 which provide guidelines
for the accounting of the lease contracts entered
in the capacity of a lessee and a lessor. For the
purpose of preparation of Standalone Financial
Statements, the Management has evaluated
the impact of change in accounting policies
on adoption of Ind AS 116 for the year ended 31
March 2019. Hence in these Standalone Financial

Statement, Ind AS 116 has been adopted with effect
from 1 April 2018 following modified retrospective
method (i.e. on 1 April 2018 the Company has
measured the lease liability at the present value
of the remaining lease payments, discounted
using the lessee''s incremental borrowing rate at
initial application date and right-of-use assets are
measured at their carrying amount as if Ind AS
116 had been applied since the commencement
date, discounted using the lessee''s incremental
borrowing rate at the date of initial application).

The Company assesses at contract inception
whether a contract is, or contains, a lease. That is, if
the contract conveys the right to control the use of
an identified asset for a period of time in exchange
for consideration.

The Company determines the lease term as the
non-cancellable period of a lease, together with
both periods covered by an option to extend the
lease if the Company is reasonably certain to
exercise that option; and periods covered by an
option to terminate the lease if the Company is
reasonably certain not to exercise that option. In
assessing whether the Company is reasonably
certain to exercise an option to extend a lease,
or not to exercise an option to terminate a lease,
it considers all relevant facts and circumstances
that create an economic incentive for the
Company to exercise the option to extend the
lease, or not to exercise the option to terminate
the lease. The Company revises the lease term if
there is a change in the non-cancellable period of
a lease.

i. As a lessee

As a lessee, the Company recognises right-of-
use assets and lease liabilities for most leases
- i.e. these leases are on-balance sheet.
The Company decided to apply recognition
exemptions to short-term leases.

At inception of a contract, the Company
assesses whether a contract is, or contains, a
lease. A contract is, or contains, a lease if the
contract conveys the right to control the use
of an identified asset for a period of time in
exchange for consideration. To assess whether
a contract conveys the right to control the use
of an identified asset, the Company uses the
definition of a lease in Ind AS 116. At inception or
on reassessment of a contract that contains
a lease component, the Company allocates
the consideration in the contract to each
lease component on the basis of their relative
stand-alone prices. However, for the leases
of land and buildings in which it is a lessee,
the Company has elected not to separate

non-lease components and account for the
lease and non-lease components as a single
lease component.

The Company recognises a right-of-use
asset and a lease liability at the lease
commencement date. The right-of-use asset
is initially measured at cost, which comprises
the initial amount of the lease liability
adjusted for any lease payments made at or
before the commencement date, plus any
initial direct costs incurred and an estimate of
costs to dismantle and remove the underlying
asset or to restore the underlying asset or
the site on which it is located, less any lease
incentives received. The right-of-use asset is
subsequently depreciated using the straight¬
line method from the commencement date
to the earlier of the end of the useful life of
the right-of-use asset or the end of the lease
term. The estimated useful lives of right-of-
use assets are determined on the same basis
as those of property, plant and equipment. In
addition, the right-of-use asset is periodically
reduced by impairment losses, if any, and
adjusted for certain remeasurements of the
lease liability.

The lease liability is initially measured at the
present value of the lease payments that
are not paid at the commencement date,
discounted using the interest rate implicit
in the lease or, if that rate cannot be readily
determined, the Company''s incremental
borrowing rate at lease commencement date.
Generally, the Company uses its incremental
borrowing rate as the discount rate. The lease
liability is measured at amortised cost using
the effective interest method. It is remeasured
when there is a change in future lease
payments arising from a change in an index
or rate, if there is a change in the Company''s
estimate of the amount expected to be
payable under a residual value guarantee,
if the Company changes its assessment of
whether it will exercise a purchase, extension
or termination option or if there is a revised
in-substance fixed lease payment. When
the lease liability is remeasured in this way,
a corresponding adjustment is made to the
carrying amount of the right-of-use asset,
or is recorded in profit or loss if the carrying
amount of the right-of-use asset has been
reduced to zero.

Lease payments included in the measurement
of the lease liability comprise:

a. Fixed payments including in-substance
fixed payments

b. Variable lease payments that depend
on an index or a rate, initially measured
using the index or rate as at the
commencement date

c. Amounts expected to be payable under a
residual value guarantee and

d. The exercise price under a purchase
option that the Company is reasonably
certain to exercise, lease payments in an
optional renewal period if the Company
is reasonably certain to exercise an
extension option, and penalties for
early termination of a lease unless the
Company is reasonably certain not to
terminate early.

Short-term leases and leases of low-
value assets

The Company has elected not to recognise
right-of-use assets and lease liabilities for
short-term leases of machinery (i.e., those
leases that have a lease term of 12 months or
less from the commencement date and do
not contain a purchase option) and leases of
low-value assets. The Company recognises
the lease payments associated with these
leases as an expense in profit or loss on a
straight-line basis over the lease term.

The Company presents right-of-use assets
as a separate line in the Standalone Balance
Sheet and lease liabilities in ''Financial
liabilities'' in the Standalone Balance Sheet.

ii. As a lessor

When the Company acts as a lessor, it
determines at lease inception whether each
lease is a finance lease or an operating lease.

To classify each lease, the Company makes
an overall assessment of whether the lease
transfers substantially all of the risks and
rewards incidental to ownership of the
underlying asset. If this is the case, then the
lease is a finance lease; if not, then it is an
operating lease. As part of this assessment,
the Company considers certain indicators
such as whether the lease is for the major part
of the economic life of the asset.

When the Company is an intermediate lessor,
it accounts for its interests in the head lease
and the sub-lease separately. It assesses
the lease classification of a sub-lease with
reference to the right-of-use asset arising

from the head lease, not with reference to the
underlying asset. If a head lease is a short¬
term lease to which the Company applies the
exemption described above, then it classifies
the sub-lease as an operating lease.

The Company recognises lease payments
received under operating leases as income
on a straight-line basis over the lease term as
part of ''other income''.

D) Property, plant and equipment
Recognition and measurement

Property, plant and equipment

The cost of an item of property, plant and
equipment shall be recognized as an asset if, and
only if 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.

Items of property, plant and equipment are
measured at cost of acquisition or construction
less accumulated depreciation and accumulated
impairment losses, if any.

Cost of an item of property, plant and equipment
comprises its purchase price, including import
duties and non-refundable purchase taxes, after
deducting trade discounts and rebates, any
directly attributable cost of bringing the item
to its working condition for its intended use and
estimated costs of dismantling and removing the
item and restoring the site on which it is located.

The cost of self-constructed item of property,
plant and equipment comprises the cost of
materials and direct labour, any other costs
directly attributable to bringing the item to working
condition for its intended use, and estimated
costs of dismantling and removing the item and
restoring the site on which it is located.

If significant parts of an item of property, plant
and equipment have different useful lives, then
they are accounted for as a separate item (major
components) of property, plant and equipment.

Any gain or loss on disposal of property, plant and
equipment is recognised in Standalone Statement
of Profit and Loss.

Capital work-in-progress

Cost of assets not ready for intended use, as on
the balance sheet date, is shown as capital work-
in-progress. Advances given towards acquisition
of property, plant and equipment outstanding at
each balance sheet date are disclosed as other
non-current assets.

Subsequent Measurement

Subsequent expenditure is capitalised 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.

Depreciation

The Company provides depreciation on Property,
Plant and Equipment based on the useful life as
determined by the Management.

The depreciation is provided under straight¬
line method.

Leasehold improvements are depreciated over
the primary period of the lease or the estimated
useful life of the assets, whichever is lower.

Depreciation on additions/ (disposals) is provided
on a pro-rata basis i.e. from/ (upto) the date on
which asset is ready for use/ (disposed-off).

Depreciation method, useful lives and residual
values are reviewed at each financial year-
end and adjusted if appropriate. Based on
technical evaluation and consequent advice, the
management believes that its estimates of useful
lives as given below best represent the period over
which management expects to use these assets.

E) Intangible assets

I ntangible assets acquired are stated at cost less
accumulated amortisation and impairment loss,
if any.

Intangible assets are amortised in the Standalone
Statement of Profit and Loss over their estimated
useful lives from the date they are available for
use based on the expected pattern of economic
benefits of the asset. Intangible asset is amortised
on straight line basis.

Subsequent expenditure is capitalised only when it
increases the future economic benefits embodied
in the specific asset to which it relates. All other
expenditure are recognised in the Standalone
Statement of Profit and Loss as incurred.

Amortisation method, useful lives and residual
values are reviewed at the end of each financial
year-end and adjusted if appropriate.

An intangible asset is derecognised on disposal,
or when no future economic benefits are expected
from use or disposal. Gains or losses arising from
derecognition of an intangible asset, measured
as the difference between the net disposal
proceeds and the carrying amount of the asset
are recognised in the Standalone Statement of
Profit and Loss when the asset is derecognised.

F) Intangible assets under development

Research costs are expensed as incurred. Software
product development costs are expensed as
incurred unless technical and commercial
feasibility of the project is demonstrated, future
economic benefits are probable, the Company
has an intention and ability to complete and use or
sell the software and the costs can be measured
reliably. The costs which can be capitalized include
the cost of software purchased, direct salary and
overhead costs that are directly attributable to
preparing the asset for its intended use.

These assets are not amortised, but evaluated for
potential impairment on an annual basis or when
there are indications that the carrying value may
not be recoverable. Any impairment is recognised
as an expense in the Standalone Statement of
Profit and Loss.

If the carrying amount of the assets exceed the
estimated recoverable amount, an impairment
is recognized for such excess amount. The
impairment loss is recognized as an expense in
the Standalone Statement of Profit and Loss, unless
the asset is carried at revalued amount, in which
case any impairment loss of the revalued asset is
treated as a revaluation decrease to the extent a
revaluation reserve is available for that asset.

G) Goodwill

Goodwill on acquisition of businesses is reported
separately from intangible assets.

As stated in the approved scheme of
amalgamation and arrangement approved by
National Company Law Tribunal, Hyderabad,
goodwill was being amortised over period of
10 years up to 31 March 2021 (Refer Note 41 and
Note 42). Further, this Goodwill is also tested for
impairment annually and is carried at cost less

accumulated amortization and accumulated
impairment losses, if any.

The Company has obtained approval from its
Board, shareholders, creditors, National Company
Law Tribunal ("NCLT") or any other appropriate
authority to modify the accounting treatment for
Goodwill mentioned (i) above with effect from 1
April 2021. As per the scheme filed and NCLT order
received, the treatment of Goodwill with effect
from 1 April 2021 shall be done as per applicable
accounting standards and / or other applicable
accounting policy. Accordingly, as per Ind AS 36 -
Impairment of Assets, the Company is required to
periodically test the impairment on Goodwill.

Goodwill generated through Business Transfer
Agreement (Refer Note 41 and Note 42) is tested
for impairment annually, and is carried at cost less
accumulated impairment, if any.

H) Impairment of non-financial assets

At each reporting date, the Company reviews
the carrying amounts of its non-financial assets
(other than inventories and deferred tax assets)
to determine whether there is any indication of
impairment. If any such indication exists, then the
asset''s recoverable amount is estimated.

For impairment testing, assets are grouped
together into the smallest group of assets that
generates the cash inflows from continuing use
that are largely independent of the cash inflows of
other assets or Cash generating units (CGUs).

The recoverable amount of a CGU (or an individual
asset) is the higher of its value in use and its fair
value less costs to sell. Value in use is based on the
estimated future cash flows, discounted to their
present value using a pre-tax discount rate that
reflects current market assessments of the time
value of money and the risks specific to the CGU
(or the asset).

Where it is not possible to estimate the recoverable
amount of individual asset, the Company
estimates the recoverable amount of the cash¬
generating unit to which the asset belongs.

An impairment loss is recognised if the
carrying amount of an asset or CGU exceeds its
recoverable amount.

Impairment losses are recognized in profit or loss.
They are allocated first to reduce the carrying
amount of any goodwill allocated to the CGU, and
then to reduce the carrying amounts of the other
assets in the CGU on a pro rata basis.

An impairment loss in respect of goodwill is not
subsequently revered. In respect of other assets for

which impairment loss has been recognized in prior
periods, the Company reviews at each reporting
date whether there is any indication that the loss
has decreased or no longer exists. An impairment
loss is reversed if there has been a change in the
estimates used to determine the recoverable
amount. Such a reversal is made only to the extent
that the asset''s carrying amount does not exceed
the carrying amount that would have been
determined, net of depreciation or amortization, if
no impairment loss has been recognized.

l) Foreign currency transactions

Transactions in foreign currencies are recorded
by the Company at the exchange rates prevailing
at the date when the transaction first qualifies
for recognition. Monetary assets and liabilities
denominated in foreign currency are translated
into the functional currency at the exchange rates
prevailing at the reporting date.

Exchange differences arising on settlement or
translation of monetary items are recognised in
the Standalone Statement of Profit and Loss.

Non-monetary items that are measured at
historical cost in a foreign currency are translated
using the exchange rates at the date of initial
transactions. Non-monetary items measured
at fair value in a foreign currency are translated
using the exchange rates at the date when the fair
value is determined.

Foreign currency gains and losses are reported on
a net basis in the Standalone Statement of Profit
and Loss.

J) Employee benefits

Short-term employee benefits

Short-term employee benefits are expensed
as the related service is provided. A liability is
recognised for the amount expected to be paid if
the Company has a present legal or constructive
obligation to pay this amount as a result of
past service provided by the employee and the
obligation can be estimated reliably.

Defined contribution plans

A defined contribution plan is a post-employment
benefit plan under which an entity pays fixed
contributions to a separate entity and will
have no legal or constructive obligation to pay
further amounts.

The Company makes specified monthly
contribution towards employee provident fund
to Government administered provident fund
scheme, which is a defined contribution scheme.
The Company''s contribution is recognised as an

expense in the Standalone Statement of Profit
and Loss during the period in which the employee
renders the related service.

Defined benefit plans

A defined benefit plan is a post-employment
benefit plan other than a defined contribution plan.

Gratuity

For defined benefit plans in the form of gratuity
fund, the cost of providing benefits is determined
using the projected unit credit method, with
actuarial valuation being carried out at the end of
each annual reporting period. The contributions
made to the fund are recognised as plan assets.
The defined benefit obligation as reduced by
fair value of plan assets is recognised in the
Standalone Balance Sheet. Re-measurements are
recognised in the other comprehensive income,
net of tax in the year in which they arise.

When the calculation results in a potential asset
for the Company, the recognised asset is limited to
the present value of economic benefits available
in the form of any future refunds from the plan or
reductions in future contributions to the plan. To
calculate the present value of economic benefits,
consideration is given to any applicable minimum
funding requirements.

Remeasurement of the net defined benefit liability,
which comprises actuarial gains and losses, the
return on plan assets (excluding interest) and
the effect of the asset ceiling (if any, excluding
interest), are recognised immediately in other
comprehensive income. Net interest expense/
(income) on the net defined liability/ (assets)
is computed by applying the discount rate
determined by reference to market yields at the
end of the reporting period on government bonds.
This rate is applied on the net defined liability/
(asset), to the net defined liability/ (asset) at the
start of the financial year after taking into account
any changes as a result of contribution and benefit
payments during the year. Net interest expense
and other expenses related to defined benefit
plans are recognised in the Standalone Statement
of Profit and Loss.

When the benefits of a plan are changed or when
a plan is curtailed, the resulting change in benefit
that relates to past service or the gain or loss on
curtailment is recognised immediately in profit or
loss. The Company recognises gains and losses
on the settlement of a defined benefit plan when
the settlement occurs.

Share-based payment arrangements

The cost of equity-settled transactions is
determined by the fair value at the date when
the grant is made using an appropriate valuation
model. That cost is recognised, together with a
corresponding increase in ''Share based payment''
reserves in equity, over the period in which the
performance and/or service conditions are
fulfilled in employee benefits expense. For share-
based payment arrangements with non-vesting
conditions, grant date fair value of the share-
based payment is measured to reflect such
conditions and there is no true-up for differences
between expected and actual outcomes. The
dilutive effect of outstanding options is reflected
as additional share dilution in the computation of
diluted earnings per share.

Other long-term employee benefits

Compensated absences which are not expected
to occur within twelve months after the end of
the period in which the employee renders the
related service are recognised as a liability at the
present value of the defined benefit obligation as
at the Balance Sheet date. The cost of providing
benefits is determined using the Projected Unit
Credit method, with actuarial valuations being
carried out at each Balance Sheet date. Actuarial
gains and losses are recognised in the Standalone
Statement of Profit and Loss in the period in which
they occur.

K) Revenue

Revenue is recognised upon transfer of control of
promised products or services to customers in an
amount that reflects the consideration which the
Company expects to receive in exchange for those
products or services. Revenue (other than for those
items to which Ind AS 109 Financial Instruments are
applicable) towards satisfaction of a performance
obligation is measured at the amount of
transaction price (net of variable consideration,
if any) allocated to that performance obligation.
The transaction price of services rendered is net
of variable consideration on account of various
discounts and claims accepted by the Company
as part of the contract.

Revenue from registrar and transfer agency
services, including tech-enabled investor solutions
for domestic mutual funds, corporates, alternative
and wealth management businesses, and
pension fund solutions, is recognized based on
the terms of the respective contracts. This revenue
is recognized either over time as services are
performed or based on the number of transactions

processed or point-in time as and when services
are rendered.

Revenue from the sale of distinct internally
developed software is recognised upfront at the
point in time when the system / software is delivered
to the customer. In cases where implementation
and / or customisation services rendered
significantly modifies or customises the software,
these services and software are accounted for
as a single performance obligation and revenue
is recognised over time on a percentage of
completion method. The Company has adopted
the output method to measure progress of each
performance obligation.

Revenue from data processing services is
recognised based on the services rendered, in
accordance with the terms of the contract, either
on a time cost basis or on the basis of number of
enumerations processed.

Recoverable expenses represent expenses
incurred in relation to services performed. that
are recovered from the customers based on the
agreed terms and conditions.

Contract assets are recognised when there
are excess of revenues earned over billings on
contracts. Contract assets are classified as
unbilled receivables (only act of invoicing is
pending) when there is unconditional right to
receive cash, and only passage of time is required,
as per contractual terms.

Unearned and deferred revenue ("contract
liability") is recognised when there are billings in
excess of revenues.

Contract fulfilment costs are generally expensed
as incurred except for certain service costs which
meet the criteria for capitalisation. Such costs
are amortised over the contractual period. The
assessment of this criteria requires the application
of judgement, in particular when considering if
costs generate or enhance resources to be used
to satisfy future performance obligations and
whether costs are expected to be recovered.

Trade receivables

Trade receivables are amounts due from customers
for services rendered in the ordinary course
of business. Trade receivables are recognised
initially at transaction price unless they contain
significant financing components. The Company
holds trade receivables with the objective to
collect the contractual cash flows and therefore
measures them subsequently at amortised cost,
less provision for expected credit loss.

L) Other income

Interest income from a financial asset is recognised
when it is probable that the economic benefits
will flow to the Company and the amount of
income can be measured reliably. Interest income
is accrued on a time basis, by reference to the
principal outstanding and at the effective interest
rate applicable, which is the rate that exactly
discounts estimated future cash receipts through
the expected life of the financial asset to that
asset''s net carrying amount on initial recognition.
Interest income is included in other income in the
Standalone Statement of Profit and Loss.

Dividends are recognised in Standalone Statement
of Profit or Loss only when the right to receive
payment is established, it is probable that the
economic benefits associated with the dividend
will flow to the Company, and the amount of the
dividend can be measured reliably.

M) Borrowings and related cost

Borrowings are initially recognised at fair value,
net of transaction costs incurred. Borrowings
are subsequently measured at amortised cost.
Any difference between the proceeds (net of
transaction costs) and the redemption amount is
recognised in profit or loss over the period of the
borrowings using the effective interest method.

Borrowing costs are expensed in the period in
which they occur. Borrowing costs consist of
interest and other costs that an entity incurs in
connection with the borrowing of funds.

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Mar 31, 2024

2. Summary of Material Accounting Policies A. Basis of preparation and measurement of Standalone Financial Statements

The Standalone Balance Sheet of the Company as at 31 March 2024, the related Standalone Statement of Profit and Loss (including Other Comprehensive Income), the Standalone Statement of Changes in Equity, and the Standalone Statement of Cash Flows for the year ended 31 March 2024 and the Significant accounting policies and Other Financial Information (together referred to as '' Standalone Financial Statements'') have been prepared in accordance with the Indian Accounting Standards (Ind AS) notified under Section 133 of the Companies Act, 2013 (“the Act”) read with Rule 3 of the Companies (Indian Accounting Standards) Rules, 2015 (as amended from time to time) presentation requirements of Division II of Schedule III to the Companies Act, 2013, (Ind AS compliant Schedule III), as applicable to the Standalone Financial Statements.

The Standalone Financial statements have been prepared on a going concern basis. The accounting policies are applied consistently to all the periods presented in the Standalone Financial Statements.

The Standalone Financial Statements have been prepared under the historical cost convention on accrual basis except for the following items:

• Defined benefit liability/(assets): fair value of plan assets less present value of defined benefit obligation

• Certain financial assets and liabilities that are measured at fair value or amortised value

The Standalone Financial Statements were authorised for issue by the Board of Directors on 29 April 2024.

Functional and presentation currency

These Standalone Financial Statements are presented in Indian Rupees (T), which is the Company''s functional currency. All amounts have been rounded to the nearest millions, unless otherwise stated.

Fair value measurement

Fair value is the price that would be received from sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair value measurement is based on the presumption that the transaction to sell the asset or transfer the liability takes place either -

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

• In the absence of a principal market, in the most advantageous market for the asset or liability

The principal or the most advantageous market must be accessible to/ by the Company.

All assets and liabilities for which fair value is measured or disclosed in the Standalone Financial Statement are categorised within the fair value hierarchy, described as follows, based on the lowest level input that is significant to the fair value measurement as a whole-

• Level 1: quoted prices (unadjusted) in active markets for identical assets or liabilities.

• Level 2: inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices).

• Level 3: inputs for the asset or liability that are not based on observable market data (unobservable inputs).

The Company''s CFO determines the appropriate valuation techniques and inputs for fair value measurements. When measuring the fair value of an asset or a liability, the Company uses observable market data as far as possible. If the inputs used to measure the fair value of an asset or a liability fall into different levels of the fair value hierarchy, then the fair value measurement is categorized in its entirety in the same level of the fair value hierarchy as the lowest level input that is significant to the entire measurement. Where Level 1 inputs are not available, the Company engages third party qualified valuers to perform the valuation. Any change in the fair value of each asset and liability is also compared with relevant external sources to determine whether the change is reasonable.

For changes that have occurred between levels in the hierarchy during the year the Company re-assesses categorisation (based on the lowest level input that is significant to the fair value measurement as a whole) at the end of each reporting period.

Use of judgments and estimates

In preparing these Standalone Financial Statements, management has made judgments, estimates and assumptions that affect the application of the Company''s accounting policies and the reported amounts of assets, liabilities, income and expenses. Management believes that the estimates used in the preparation of the Standalone Financial Statements are prudent and reasonable. Actual results may differ from these estimates.

Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to estimates are recognised prospectively.

Changes in estimates are reflected in the financial estimates in the period in which changes are made and if material, their effects are disclosed in the notes to the Standalone Financial Statements.

a) Judgements

Information about the judgments made in applying accounting policies that have the most significant effects on the amounts recognised in the Standalone Financial Statements have been given below:

• Note O - Classification of financial assets: assessment of business model within which the assets the assets are held and assessment of whether the contractual terms of the financial asset are solely payments of principal and interest on the principal amount outstanding.

• Note C - Lease classification and identification of lease component

• Note F - Identification and recognition of intangible assets under development

b) Assumptions and estimation uncertainties

Information about assumptions and estimation uncertainties that have a significant risk of resulting in a material adjustment in the Standalone Financial Statements for every period ended is included below:

• Employee benefit plans

The cost of defined benefit plans and the present value of the obligation are determined using actuarial valuations. An actuarial valuation involves making various assumptions which may differ from actual developments in the future. These include the determination of the discount rate, future salary increases and mortality rates However, any changes in these assumptions may have impact on the reported amount of obligation and expenses (Refer note J).

• Taxes

Uncertainties exist with respect to the interpretation of complex tax regulations,

b) Assumptions and estimation uncertainties (Contd.

changes in tax laws, and the amount and timing of future taxable income. The Company establishes provisions, based on reasonable estimates, for possible consequences of assessment by the tax authorities of the jurisdiction in which it operates. The amount of such provisions is based on various factors, such as experience of previous tax assessment and differing interpretations of tax laws by the taxable entity and the responsible tax authority. The Company assesses the probability for litigation and subsequent cash outflow with respect to taxes.

Deferred income tax assets are recognised for all unused tax losses to the extent that it is probable that taxable profit will be available against which the losses can be utilised. Significant management judgment is required to determine the amount of deferred tax assets that can be recognised, based upon the likely timing and the level of future taxable profits together with future tax planning strategies. (Refer note P)

• Useful life and residual value of property, plant and equipment and intangible assets

The charge in respect of periodic depreciation is derived after estimating the asset''s expected useful life and the expected residual value at the end of its life. The depreciation method, useful lives and residual values of Company''s assets are estimated by Management at the time the asset is acquired and reviewed during each financial year. (Refer note D and E)

• Impairment of financial assets

Analysis of historical payment patterns, customer concentrations, customer creditworthiness and current economic trends. If the

financial condition of a customer deteriorates, additional allowances may be required. (Refer note O)

• Provisions and contingencies Assessments undertaken in recognizing the provisions and contingencies have been made as per the best judgment of the management based on the current available information. (Refer note N)

• Fair value measurement of financial instruments

When the fair value of financial assets and financial liabilities recorded in the Standalone Balance Sheet cannot be derived from active markets, their fair value is determined using valuation techniques including the discounted cash flow model. The inputs to these models are taken from observable markets where possible, but where this is not feasible, a degree of judgments is required in establishing fair values. The judgments include considerations of inputs such as liquidity risk, credit risk and volatility. Changes in assumptions about these factors could affect the reported fair value of financial instruments. (Refer note O)

• Impairment of non-financial assets: Key assumptions for discount rate, growth rate, etc.

The determination of recoverable amounts of the CGUs assessed in the annual impairment test requires the Company to estimate their fair value net of disposal costs as well as their value-in-use. The assessment of value-in-use requires assumptions to be made with respect to the operating cash flows of the CGUs as well as the discount rates. (Refer note H)

B) Classification of assets and liabilities as current and non-current

The Company presents assets and liabilities in the Standalone Balance Sheet based on current/ noncurrent classification. An asset is treated as current when it is:

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

• Held primarily for the purpose of trading

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

• Cash and cash equivalents unless restricted from being exchanged or used to settle a liability for at least twelve months after the reporting period

All other assets are classified as non-current.

Deferred tax assets and liabilities are classified as noncurrent assets and liabilities.

A liability is treated as current when:

• It is expected to be settled in normal operating cycle

• It is held primarily for the purpose of trading

• It is due to be settled within twelve months after the reporting period, or

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

All other liabilities are classified as non-current.

Operating Cycle

The operating cycle is the time between the acquisition of the assets for processing and their realisation in cash and cash equivalents. The Company has identified twelve months as its operating cycle.

C) Leases

The lease standard Ind AS 116 was notified to be effective w.e.f. 1 April 2019 which provide guidelines for the accounting of the lease contracts entered in

the capacity of a lessee and a lessor. For the purpose of preparation of Standalone Financial Statements, the Management has evaluated the impact of change in accounting policies on adoption of Ind AS 116 for the year ended 31 March 2019. Hence in these Standalone Financial Statement, Ind AS 116 has been adopted with effect from 1 April 2018 following modified retrospective method (i.e. on 1 April 2018 the Company has measured the lease liability at the present value of the remaining lease payments, discounted using the lessee''s incremental borrowing rate at initial application date and right-of-use assets are measured at their carrying amount as if Ind AS 116 had been applied since the commencement date, discounted using the lessee''s incremental borrowing rate at the date of initial application).

The Company assesses at contract inception whether a contract is, or contains, a lease. That is, if the contract conveys the right to control the use of an identified asset for a period of time in exchange for consideration.

The Company determines the lease term as the noncancellable period of a lease, together with both periods covered by an option to extend the lease if the Company is reasonably certain to exercise that option; and periods covered by an option to terminate the lease if the Company is reasonably certain not to exercise that option. In assessing whether the Company is reasonably certain to exercise an option to extend a lease, or not to exercise an option to terminate a lease, it considers all relevant facts and circumstances that create an economic incentive for the Company to exercise the option to extend the lease, or not to exercise the option to terminate the lease. The Company revises the lease term if there is a change in the non-cancellable period of a lease.

i. ^s a lessee

As a lessee, the Company recognises right-of-use assets and lease liabilities for most leases - i.e. these leases are on-balance sheet. The Company decided to apply recognition exemptions to shortterm leases.

At inception of a contract, the Company assesses whether a contract is, or contains, a lease. A contract is, or contains, a lease if the contract conveys the right to control the use of an identified asset for a period of time in exchange for consideration. To assess whether a contract conveys the right to control the use of an identified asset, the Company uses the definition of a lease in Ind AS 116. At inception or on reassessment of a contract that contains a lease component, the Company allocates the consideration in the contract to each lease component on the basis of their relative standalone prices. However, for the leases of land and buildings in which it is a lessee, the Company has elected not to separate non-lease components and account for the lease and non-lease components as a single lease component.

The Company recognises a right-of-use asset and a lease liability at the lease commencement date. The right-of-use asset is initially measured at cost, which comprises the initial amount of the lease liability adjusted for any lease payments made at or before the commencement date, plus any initial direct costs incurred and an estimate of costs to dismantle and remove the underlying asset or to restore the underlying asset or the site on which it is located, less any lease incentives received. The right-of-use asset is subsequently depreciated using the straight-line method from the commencement date to the earlier of the end of the useful life of the right-of-use asset or the end of the lease term. The estimated useful lives of right-of-use assets are determined on the same basis as those of property, plant and equipment. In addition, the right-of-use asset is periodically reduced by impairment losses, if any, and adjusted for certain remeasurements of the lease liability.

The lease liability is initially measured at the present value of the lease payments that are not paid at the commencement date, discounted using the interest rate implicit in the lease or, if that rate cannot be readily determined, the Company''s incremental borrowing rate at lease commencement date.

Generally, the Company uses its incremental borrowing rate as the discount rate. The lease liability is measured at amortised cost using the effective interest method. It is remeasured when there is a change in future lease payments arising from a change in an index or rate, if there is a change in the Company''s estimate of the amount expected to be payable under a residual value guarantee, if the Company changes its assessment of whether it will exercise a purchase, extension or termination option or if there is a revised insubstance fixed lease payment. When the lease liability is remeasured in this way, a corresponding adjustment is made to the carrying amount of the right-of-use asset, or is recorded in profit or loss if the carrying amount of the right-of-use asset has been reduced to zero.

Lease payments included in the measurement of the lease liability comprise:

a. Fixed payments including in-substance fixed payments

b. Variable lease payments that depend on an index or a rate, initially measured using the index or rate as at the commencement date

c. Amounts expected to be payable under a residual value guarantee and

d. The exercise price under a purchase option that the Company is reasonably certain to exercise, lease payments in an optional renewal period if the Company is reasonably certain to exercise an extension option, and penalties for early termination of a lease unless the Company is reasonably certain not to terminate early.

Short-term leases and leases of low-value assets

The Company has elected not to recognise right-of-use assets and lease liabilities for short-term leases of machinery (i.e., those leases that have a lease term of 12 months or less from the commencement date and do not contain a purchase option) and leases of low-value assets. The Company recognises the lease payments

C) Leases (Contd.)

associated with these leases as an expense in profit or loss on a straight-line basis over the lease term.

The Company presents right-of-use assets as a separate line in the Standalone Balance Sheet and lease liabilities in ''Financial liabilities'' in the Standalone Balance Sheet.

ii. ^s a lessor

When the Company acts as a lessor, it determines at lease inception whether each lease is a finance lease or an operating lease.

To classify each lease, the Company makes an overall assessment of whether the lease transfers substantially all of the risks and rewards incidental to ownership of the underlying asset. If this is the case, then the lease is a finance lease; if not, then it is an operating lease. As part of this assessment, the Company considers certain indicators such as whether the lease is for the major part of the economic life of the asset.

When the Company is an intermediate lessor, it accounts for its interests in the head lease and the sub-lease separately. It assesses the lease classification of a sub-lease with reference to the right-of-use asset arising from the head lease, not with reference to the underlying asset. If a head lease is a short-term lease to which the Company applies the exemption described above, then it classifies the sub-lease as an operating lease.

The Company recognises lease payments received under operating leases as income on a straight-line basis over the lease term as part of ''other income''.

D) Property, plant and equipment Recognition and measurement

Property, plant and equipment

The cost of an item of property, plant and equipment shall be recognized as an asset if, and only if 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.

Items of property, plant and equipment are measured at cost of acquisition or construction less accumulated depreciation and accumulated impairment losses, if any.

Cost of an item of property, plant and equipment comprises its purchase price, including import duties and non-refundable purchase taxes, after deducting trade discounts and rebates, any directly attributable cost of bringing the item to its working condition for its intended use and estimated costs of dismantling and removing the item and restoring the site on which it is located.

The cost of self-constructed item of property, plant and equipment comprises the cost of materials and direct labour, any other costs directly attributable to bringing the item to working condition for its intended use, and estimated costs of dismantling and removing the item and restoring the site on which it is located.

If significant parts of an item of property, plant and equipment have different useful lives, then they are accounted for as a separate item (major components) of property, plant and equipment.

Any gain or loss on disposal of property, plant and equipment is recognised in Standalone Statement of Profit and Loss.

Capital work-in-progress

Cost of assets not ready for intended use, as on the balance sheet date, is shown as capital work-in-progress. Advances given towards acquisition of property, plant and equipment outstanding at each balance sheet date are disclosed as other non-current assets.

Subsequent Measurement

Subsequent expenditure is capitalised 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.

Depreciation

The Company provides depreciation on Property, Plant and Equipment based on the useful life as determined by the Management.

The depreciation is provided under straight-line method.

Leasehold improvements are depreciated over the primary period of the lease or the estimated useful life of the assets, whichever is lower.

Depreciation on additions/ (disposals) is provided on a pro-rata basis i.e. from/ (upto) the date on which asset is ready for use/ (disposed-off).

Depreciation method, useful lives and residual values are reviewed at each financial year-end and adjusted if appropriate. Based on technical evaluation and consequent advice, the management believes that its estimates of useful lives as given below best represent the period over which management expects to use these assets.

E) Intangible assets

Intangible assets acquired are stated at cost less accumulated amortisation and impairment loss, if any.

Intangible assets are amortised in the Standalone Statement of Profit and Loss over their estimated useful lives from the date they are available for use based on the expected pattern of economic benefits of the asset. Intangible asset is amortised on straight line basis.

Subsequent expenditure is capitalised only when it increases the future economic benefits embodied in the specific asset to which it relates. All other expenditure are recognised in the Standalone Statement of Profit and Loss as incurred.

Amortisation method, useful lives and residual values are reviewed at the end of each financial year-end and adjusted if appropriate.

An intangible asset is derecognised on disposal, or when no future economic benefits are expected from use or disposal. Gains or losses arising from derecognition of an intangible asset, measured as the difference between the net disposal proceeds and the carrying amount of the asset are recognised in the Standalone Statement of Profit and Loss when the asset is derecognised.

^:) Intangible assets under development

Research costs are expensed as incurred. Software product development costs are expensed as incurred unless technical and commercial feasibility of the project is demonstrated, future economic benefits are probable, the Company has an intention and ability to complete and use or sell the software and the costs can be measured reliably. The costs which can be capitalized include the cost of software purchased, direct salary and overhead costs that are directly attributable to preparing the asset for its intended use.

These assets are not amortised, but evaluated for potential impairment on an annual basis or when there are indications that the carrying value may not be recoverable. Any impairment is recognised as an expense in the Standalone Statement of Profit and Loss.

If the carrying amount of the assets exceed the estimated recoverable amount, an impairment is recognized for such excess amount. The impairment loss is recognized as an expense in the Standalone Statement of Profit and Loss, unless the asset is carried at revalued amount, in which case any impairment loss of the revalued asset is treated as a revaluation decrease to the extent a revaluation reserve is available for that asset.

G) Goodwill

Goodwill on acquisition of businesses is reported separately from intangible assets.

i) As stated in the approved scheme of amalgamation and arrangement approved by National Company Law Tribunal, Hyderabad, goodwill was being amortised over period of 10 years up to 31 March 2021 (Refer Note 42 and Note 43). Further, this Goodwill is also tested for impairment annually and is carried at cost less accumulated amortization and accumulated impairment losses, if any.

The Company has obtained approval from its Board, shareholders, creditors, National Company Law Tribunal (“NCLT”) or any other appropriate authority to modify the accounting treatment for Goodwill mentioned (i) above with effect from 1 April 2021. As per the scheme filed and NCLT order received, the treatment of Goodwill with effect from 1 April 2021 shall be done as per applicable accounting standards and / or other applicable accounting policy. Accordingly, as per Ind AS 36 - Impairment of Assets, the Company is required to periodically test the impairment on Goodwill.

Goodwill generated through Business Transfer Agreement (Refer Note 42 and Note 43) is tested for impairment annually, and is carried at cost less accumulated impairment, if any.

H) Impairment of non-financial assets

At each reporting date, the Company reviews the carrying amounts of its non-financial assets (other than inventories and deferred tax assets) to determine whether there is any indication of impairment. If any such indication exists, then the asset''s recoverable amount is estimated.

For impairment testing, assets are grouped together into the smallest group of assets that generates the cash inflows from continuing use that are largely independent of the cash inflows of other assets or Cash generating units (CGUs).

The recoverable amount of a CGU (or an individual asset) is the higher of its value in use and its fair value less costs to sell. Value in use is based on the estimated future cash flows, discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the CGU (or the asset).

Where it is not possible to estimate the recoverable amount of individual asset, the Company estimates the recoverable amount of the cash-generating unit to which the asset belongs.

An impairment loss is recognised if the carrying amount of an asset or CGU exceeds its recoverable amount.

Impairment losses are recognized in profit or loss. They are allocated first to reduce the carrying amount of any goodwill allocated to the CGU, and then to reduce the carrying amounts of the other assets in the CGU on a pro rata basis.

An impairment loss in respect of goodwill is not subsequently revered. In respect of other assets for which impairment loss has been recognized in prior periods, the Company reviews at each reporting date whether there is any indication that the loss has decreased or no longer exists. An impairment loss is reversed if there has been a change in the estimates used to determine the recoverable amount. Such a reversal is made only to the extent that the asset''s carrying amount does not exceed the carrying amount that would have been determined, net of depreciation or amortization, if no impairment loss has been recognized.

I) Foreign currency transactions

Transactions in foreign currencies are recorded by the Company at the exchange rates prevailing at the date when the transaction first qualifies for recognition.

I) Foreign currency transactions (Contd.)

Monetary assets and liabilities denominated in foreign currency are translated into the functional currency at the exchange rates prevailing at the reporting date.

Exchange differences arising on settlement or translation of monetary items are recognised in the Standalone Statement of Profit and Loss.

Non-monetary items that are measured at historical cost in a foreign currency are translated using the exchange rates at the date of initial transactions. Non-monetary items measured at fair value in a foreign currency are translated using the exchange rates at the date when the fair value is determined.

Foreign currency gains and losses are reported on a net basis in the Standalone Statement of Profit and Loss.

J) Employee benefits

Short-term employee benefits

Short-term employee benefits are expensed as the related service is provided. A liability is recognised for the amount expected to be paid if the Company has a present legal or constructive obligation to pay this amount as a result of past service provided by the employee and the obligation can be estimated reliably.

Defined contribution plans

A defined contribution plan is a post-employment benefit plan under which an entity pays fixed contributions to a separate entity and will have no legal or constructive obligation to pay further amounts.

The Company makes specified monthly contribution towards employee provident fund to Government administered provident fund scheme, which is a defined contribution scheme. The Company''s contribution is recognised as an expense in the Standalone Statement of Profit and Loss during the period in which the employee renders the related service.

Defined benefit plans

A defined benefit plan is a post-employment benefit plan other than a defined contribution plan.

Gratuity

For defined benefit plans in the form of gratuity fund, the cost of providing benefits is determined using the projected unit credit method, with actuarial valuation being carried out at the end of each annual reporting period. The contributions made to the fund are recognised as plan assets. The defined benefit obligation as reduced by fair value of plan assets is recognised in the Standalone Balance Sheet. Re-measurements are recognised in the other comprehensive income, net of tax in the year in which they arise.

When the calculation results in a potential asset for the Company, the recognised asset is limited to the present value of economic benefits available in the form of any future refunds from the plan or reductions in future contributions to the plan. To calculate the present value of economic benefits, consideration is given to any applicable minimum funding requirements.

Remeasurement of the net defined benefit liability, which comprises actuarial gains and losses, the return on plan assets (excluding interest) and the effect of the asset ceiling (if any, excluding interest), are recognised immediately in other comprehensive income. Net interest expense/ (income) on the net defined liability/ (assets) is computed by applying the discount rate determined by reference to market yields at the end of the reporting period on government bonds. This rate is applied on the net defined liability/ (asset), to the net defined liability/ (asset) at the start of the financial year after taking into account any changes as a result of contribution and benefit payments during the year. Net interest expense and other expenses related to defined benefit plans are recognised in the Standalone Statement of Profit and Loss.

When the benefits of a plan are changed or when a plan is curtailed, the resulting change in benefit that relates to past service or the gain or loss on curtailment is recognised immediately in profit or loss. The Company recognises gains and losses on the settlement of a defined benefit plan when the settlement occurs.

J) Employee benefits (Contd.)

Share-based payment arrangements The cost of equity-settled transactions is determined by the fair value at the date when the grant is made using an appropriate valuation model. That cost is recognised, together with a corresponding increase in ''Share based payment'' reserves in equity, over the period in which the performance and/or service conditions are fulfilled in employee benefits expense. For share-based payment arrangements with non-vesting conditions, grant date fair value of the share-based payment is measured to reflect such conditions and there is no true-up for differences between expected and actual outcomes. The dilutive effect of outstanding options is reflected as additional share dilution in the computation of diluted earnings per share.

Other long-term employee benefits Compensated absences which are not expected to occur within twelve months after the end of the period in which the employee renders the related service are recognised as a liability at the present value of the defined benefit obligation as at the Balance Sheet date. The cost of providing benefits is determined using the Projected Unit Credit method, with actuarial valuations being carried out at each Balance Sheet date. Actuarial gains and losses are recognised in the Standalone Statement of Profit and Loss in the period in which they occur.

K) Revenue

Revenue is recognised upon transfer of control of promised products or services to customers in an amount that reflects the consideration which the Company expects to receive in exchange for those products or services. Revenue (other than for those items to which Ind AS 109 Financial Instruments are applicable) towards satisfaction of a performance obligation is measured at the amount of transaction price (net of variable consideration, if any) allocated to that performance obligation. The transaction price of services rendered is net of variable consideration on account of various discounts and claims accepted by the Company as part of the contract.

Revenue from registrar and transfer agency services provided to domestic mutual funds, corporates, alternative and wealth management businesses and revenue from pension fund solutions are recognized as the related services are performed over time in accordance with the terms and conditions of the respective contracts entered into by the Company with its customers.

Revenue from data processing services is recognised based on the services rendered, in accordance with the terms of the contract, either on a time cost basis or on the basis of number of enumerations processed.

Recoverable expenses represent expenses incurred in relation to services performed. that are recovered from the customers based on the agreed terms and conditions.

Contract assets are recognised when there are excess of revenues earned over billings on contracts. Contract assets are classified as unbilled receivables (only act of invoicing is pending) when there is unconditional right to receive cash, and only passage of time is required, as per contractual terms.

Unearned and deferred revenue (“contract liability”) is recognised when there are billings in excess of revenues.

Revenue from the sale of distinct internally developed software is recognised upfront at the point in time when the system / software is delivered to the customer. In cases where implementation and / or customisation services rendered significantly modifies or customises the software, these services and software are accounted for as a single performance obligation and revenue is recognised over time on a percentage of completion method.

Contract fulfilment costs are generally expensed as incurred except for certain service costs which meet the criteria for capitalisation. Such costs are amortised over the contractual period. The assessment of this criteria requires the application of judgement, in particular when considering if costs generate or enhance resources to be used to satisfy future performance obligations and whether costs are expected to be recovered.

K) Revenue (Contd.)

Trade receivables

Trade receivables are amounts due from customers for services rendered in the ordinary course of business. Trade receivables are recognised initially at transaction price unless they contain significant financing components. The Company holds trade receivables with the objective to collect the contractual cash flows and therefore measures them subsequently at amortised cost, less provision for expected credit loss.

L) Other income

Interest income from a financial asset is recognised when it is probable that the economic benefits will flow to the Company and the amount of income can be measured reliably. Interest income is accrued on a time basis, by reference to the principal outstanding and at the effective interest rate applicable, which is the rate that exactly discounts estimated future cash receipts through the expected life of the financial asset to that asset''s net carrying amount on initial recognition. Interest income is included in other income in the Standalone Statement of Profit and Loss.

Dividends are recognised in Standalone Statement of Profit or Loss only when the right to receive payment is established, it is probable that the economic benefits associated with the dividend will flow to the Company, and the amount of the dividend can be measured reliably.

M) Borrowings and related cost

Borrowings are initially recognised at fair value, net of transaction costs incurred. Borrowings are subsequently measured at amortised cost. Any difference between the proceeds (net of transaction costs) and the redemption amount is recognised in profit or loss over the period of the borrowings using the effective interest method.

Borrowing costs are expensed in the period in which they occur. Borrowing costs consist of interest and other costs that an entity incurs in connection with the borrowing of funds.

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Mar 31, 2023

1. Reporting entity

KFin Technologies Limited ("the Parent Company") (formerly known as KFin Technologies Private Limited) was incorporated on 08 June 2017 at Hyderabad, India. The Company''s registered office is at Selenium, Tower B, Plot No- 31 & 32, Financial District, Nanakramguda, Serilingampally Hyderabad, "Rangareddy" Telangana 500032. The Company is engaged in providing service of Registrar to the Public Issue of Securities, Registrar to the Securities Transfers, and back office operations to mutual fund houses and data processing activities.

The Company was converted into a public limited company under the Companies Act, 2013 on 24 February 2022 and consequently, the name was changed to "KFin Technologies Limited"

2. Significant Accounting PoliciesA. Basis of preparation and measurement of Standalone Financial Statement

The Standalone Balance Sheet of the Company as at 31 March 2023, the related Standalone Statement of Profit and Loss (including Other Comprehensive Income), the Standalone Statement of Changes in Equity, and the Standalone Statement of Cash Flows for the year ended 31 March 2023 and the Significant accounting policies and Other Financial Information (together referred to as '' Standalone Financial Statement'') have been prepared in accordance with the Indian Accounting Standards (Ind AS) notified under Section 133 of the Companies Act 2013 ("the Act") read with Rule 3 of the Companies (Indian Accounting Standard) Rules, 2015 and Companies (Indian Accounting Standards) Amendment Rule, 2016 and other relevant provisions of the Act.

The Standalone Financial statement have been prepared on a going concern basis. The accounting policies are applied consistently to all the periods presented in the Standalone Financial Statement.

The Standalone Financial Statement have been prepared under the historical cost convention on accrual basis except for the following items:

• Defined benefit liability/(assets): fair value of plan assets less present value of defined benefit obligation

• Certain financial assets and liabilities that are measured at fair value or amortised value

This Standalone Financial Statement was authorised for issue by the Board of Directors on 05 May 2023.

Functional and presentation currency

These Standalone Financial Statement are presented in Indian Rupees (T), which is the Company''s functional currency. All amounts have been rounded to the nearest millions, unless otherwise stated.

Fair value measurement

Fair value is the price that would be received from sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair value measurement is based on the presumption that the transaction to sell the asset or transfer the liability takes place either -

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

• I n the absence of a principal market, in the most advantageous market for the asset or liability

The principal or the most advantageous market must be accessible to/ by the Company.

All assets and liabilities for which fair value is measured or disclosed in the Standalone Financial Statement are categorised within the fair value hierarchy, described as follows, based on the lowest level input that is significant to the fair value measurement as a whole-

• Level 1: quoted prices (unadjusted) in active markets for identical assets or liabilities.

• Level 2: inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices).

• Level 3: inputs for the asset or liability that are not based on observable market data (unobservable inputs).

The Company''s CFO determines the appropriate valuation techniques and inputs for fair value measurements. When measuring the fair value of an asset or a liability, the Company uses observable market data as far as possible. If the inputs used to measure the fair value of an asset or a liability fall into different levels of the fair value hierarchy, then the fair value measurement is categorized in its entirety in the same level of the fair value hierarchy as the lowest level input that is significant to the entire

measurement. Where Level 1 inputs are not available, the Company engages third party qualified valuers to perform the valuation. Any change in the fair value of each asset and liability is also compared with relevant external sources to determine whether the change is reasonable.

For changes that have occurred between levels in the hierarchy during the year the Company re-assesses categorisation (based on the lowest level input that is significant to the fair value measurement as a whole) at the end of each reporting period.

Use of judgments and estimates

In preparing these Standalone Financial Statement, management has made judgments, estimates and assumptions that affect the application of the Company''s accounting policies and the reported amounts of assets, liabilities, income and expenses. Management believes that the estimates used in the preparation of the Standalone Financial Statement are prudent and reasonable. Actual results may differ from these estimates.

Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to estimates are recognised prospectively.

Changes in estimates are reflected in the financial estimates in the period in which changes are made and if material, their effects are disclosed in the notes to the Standalone Financial Statement.

a) Judgements

I nformation about the judgments made in applying accounting policies that have the most significant effects on the amounts recognised in the Standalone Financial Statement have been given below:

• Note Q - Classification of financial assets: assessment of business model within which the assets are held and assessment of whether the contractual terms of the financial asset are solely payments of principal and interest on the principal amount outstanding.

• Note C - Lease classification and identification of lease component

b) Assumptions and estimation uncertainties

Information about assumptions and estimation uncertainties that have a significant risk of resulting in a material adjustment in the Standalone Financial Statement for every period ended is included below:

• Employee benefit plans

The cost of defined benefit plans and the present value of the obligation are determined using actuarial valuations. An actuarial valuation involves making various assumptions which may differ from actual developments in the future. These includes the determination of the discount rate, future salary increases and mortality rates However, any changes in these assumptions may have impact on the reported amount of obligation and expenses. (Refer note J).

• Taxes

Uncertainties exist with respect to the interpretation of complex tax regulations, changes in tax laws, and the amount and timing of future taxable income. The Company establishes provisions, based on reasonable estimates, for possible consequences of assessment by the tax authorities of the jurisdiction in which it operates. The amount of such provisions is based on various factors, such as experience of previous tax assessment and differing interpretations of tax laws by the taxable entity and the responsible tax authority. The Company assesses the probability for litigation and subsequent cash outflow with respect to taxes.

Deferred income tax assets are recognised for all unused tax losses to the extent that it is probable that taxable profit will be available against which the losses can be utilised. Significant management judgment is required to determine the amount of deferred tax assets that can be recognised, based upon the likely timing and the level of future taxable profits together with future tax planning strategies. (Refer note R)

• Useful life and residual value of property, plant and equipment and intangible assets

The charge in respect of periodic depreciation is derived after estimating the asset''s expected useful life and the expected residual value at the end of its life. The depreciation method, useful lives and residual values of Company''s assets are estimated by Management at the time the asset is acquired and reviewed during each financial year. (Refer note D, E & G)

• Impairment of financial assets

Analysis of historical payment patterns, customer concentrations, customer credit-worthiness and current economic trends. If the financial condition of a customer deteriorates, additional allowances may be required. (Refer note Q)

• Provisions and contingencies

Assessments undertaken in recognizing the provisions and contingencies have been made as per the best judgment of the management based on the current available information. (Refer note P).

• Fair value measurement of financial instruments

When the fair value of financial assets and financial liabilities recorded in the balance sheet cannot be derived from active markets, their fair value is determined using valuation techniques including the discounted cash flow model. The inputs to these models are taken from observable markets where possible, but where this is not feasible, a degree of judgments is required in establishing fair values. The judgments include considerations of inputs such as liquidity risk, credit risk and volatility. Changes in assumptions about these factors could affect the reported fair value of financial instruments. (Refer note Q).

• Impairment of non-financial assets: Key assumptions for discount rate, growth rate, etc. The determination of recoverable amounts of the CGUs assessed in the annual impairment

test requires the Company to estimate their fair value net of disposal costs as well as their value-in-use. The assessment of value-in-use requires assumptions to be made with respect to the operating cash flows of the CGUs as well as the discount rates. (Refer note H)

B) Classification of assets and liabilities as current and non-current

The Company presents assets and liabilities in the balance sheet based on current/ non-current classification. An asset is treated as current when it is:

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

• Held primarily for the purpose of trading

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

• Cash and cash equivalents unless restricted from being exchanged or used to settle a liability for at least twelve months after the reporting period.

All other assets are classified as non-current.

Deferred tax assets are classified as non-current assets.

A liability is treated as current when:

• It is expected to be settled in normal operating cycle.

• It is held primarily for the purpose of trading

• It is due to be settled within twelve months after the reporting period, or

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

All other liabilities are classified as non-current Operating Cycle

The operating cycle is the time between the acquisition of the assets for processing and their realisation in cash and cash equivalents. The Company has identified twelve months as its operating cycle.

A new lease standard i.e., Ind AS 116 has been notified to be effective w.e.f. 1 April 2019 which provide guidelines for the accounting of the lease contracts entered in the capacity of a lessee and a lessor. For the purpose of preparation of Standalone Financial Statement, the Management has evaluated the impact of change in accounting policies on adoption of Ind AS 116 for the year ended 31 March 2019. Hence in these Standalone Financial Statement, Ind AS 116 has been adopted with effect from 1 April 2018 following modified retrospective method (i.e. on 1 April 2018 the Company has measured the lease liability at the present value of the remaining lease payments, discounted using the lessee''s incremental borrowing rate at initial application date and right-of-use assets are measured at their carrying amount as if Ind AS 116 had been applied since the commencement date, discounted using the lessee''s incremental borrowing rate at the date of initial application).

The Company assesses at contract inception whether a contract is, or contains, a lease. That is, if the contract conveys the right to control the use of an identified asset for a period of time in exchange for consideration.

The Company determines the lease term as the noncancellable period of a lease, together with both periods covered by an option to extend the lease if the Company is reasonably certain to exercise that option; and periods covered by an option to terminate the lease if the Company is reasonably certain not to exercise that option. In assessing whether the Company is reasonably certain to exercise an option to extend a lease, or not to exercise an option to terminate a lease, it considers all relevant facts and circumstances that create an economic incentive for the Company to exercise the option to extend the lease, or not to exercise the option to terminate the lease. The Company revises the lease term if there is a change in the non-cancellable period of a lease.

The Company used the following practical expedients when applying Ind AS 116 to leases previously classified as operating leases under Ind AS 17:

• Applied a single discount rate to a portfolio of leases with similar characteristics;

• Applied the exemption not to recognise right-of-use assets and liabilities for leases with less than 12 months of lease term and leases of low value;

• Excluded initial direct costs from measuring the right-of-use asset at the date of initial application;

• Used hindsight when determining the lease term if the contract contains options to extend or terminate the lease

i. As a lessee

As a lessee, the Company recognises right-of-use assets and lease liabilities for most leases - i.e. these leases are on-balance sheet. The Company decided to apply recognition exemptions to short-term leases.

At inception of a contract, the Company assesses whether a contract is, or contains, a lease. A contract is, or contains, a lease if the contract conveys the right to control the use of an identified asset for a period of time in exchange for consideration. To assess whether a contract conveys the right to control the use of an identified asset, the Company uses the definition of a lease in Ind AS 116. At inception or on reassessment of a contract that contains a lease component, the Company allocates the consideration in the contract to each lease component on the basis of their relative stand-alone prices. However, for the leases of land and buildings in which it is a lessee, the Company has elected not to separate non-lease components and account for the lease and non-lease components as a single lease component.

The Company recognises a right-of-use asset and a lease liability at the lease commencement date. The right-of-use asset is initially measured at cost, which comprises the initial amount of the lease liability adjusted for any lease payments made at or before the commencement date, plus any initial direct costs incurred and an estimate of costs to dismantle and remove the underlying asset or to restore the underlying asset or the site on which it is located, less any lease incentives received. The right-of-use asset is subsequently depreciated using the straight-line method from the commencement date to the earlier of the end of the useful life of

the right-of-use asset or the end of the lease term. The estimated useful lives of right-of-use assets are determined on the same basis as those of property, plant and equipment. In addition, the right-of-use asset is periodically reduced by impairment losses, if any, and adjusted for certain remeasurements of the lease liability.

The lease liability is initially measured at the present value of the lease payments that are not paid at the commencement date, discounted using the interest rate implicit in the lease or, if that rate cannot be readily determined, the Company''s incremental borrowing rate at lease commencement date. Generally, the Company uses its incremental borrowing rate as the discount rate. The lease liability is measured at amortised cost using the effective interest method. It is remeasured when there is a change in future lease payments arising from a change in an index or rate, if there is a change in the Company''s estimate of the amount expected to be payable under a residual value guarantee, or if the Company changes its assessment of whether it will exercise a purchase, extension or termination option. When the lease liability is remeasured in this way, a corresponding adjustment is made to the carrying amount of the right-of-use asset, or is recorded in profit or loss if the carrying amount of the right-of-use asset has been reduced to zero.

Lease payments included in the measurement of the lease liability comprise:

a. Fixed payments including in-substance fixed payments

b. Variable lease payments that depend on an index or a rate, initially measured using the index or rate as at the commencement date

c. Amounts expected to be payable under a residual value guarantee

Short-term leases and leases of low-value assets

The Company has elected not to recognise right-of-use assets and lease liabilities for short-term leases of machinery that have a lease term of 12 months or less and leases of low-value assets.

The Company presents right-of-use assets as a separate line in the balance sheet and lease liabilities in ''Financial liabilities'' in the Balance sheet.

ii. As a lessor

When the Company acts as a lessor, it determines at lease inception whether each lease is a finance lease or an operating lease.

To classify each lease, the Company makes an overall assessment of whether the lease transfers substantially all of the risks and rewards incidental to ownership of the underlying asset. If this is the case, then the lease is a finance lease; if not, then it is an operating lease. As part of this assessment, the Company considers certain indicators such as whether the lease is for the major part of the economic life of the asset.

When the Company is an intermediate lessor, it accounts for its interests in the head lease and the sub-lease separately. It assesses the lease classification of a sub-lease with reference to the right-of-use asset arising from the head lease, not with reference to the underlying asset. If a head lease is a short-term lease to which the Company applies the exemption described above, then it classifies the sub-lease as an operating lease.

The Company recognises lease payments received under operating leases as income on a straight-line basis over the lease term as part of ''other income''.

D) Property, plant and equipment

Recognition and measurement Property, plant and equipment

Items of property, plant and equipment are measured at cost of acquisition or construction less accumulated depreciation and accumulated impairment losses, if any.

Cost of an item of property, plant and equipment comprises its purchase price, including import duties and non-refundable purchase taxes, after deducting trade discounts and rebates, any directly attributable cost of bringing the item to its working condition for its intended use and estimated costs of dismantling and removing the item and restoring the site on which it is located.

Recognition and measurement (continued)

If significant parts of an item of property, plant and equipment have different useful lives, then they are accounted for as a separate item (major components) of property, plant and equipment. Any gain or loss on disposal of property, plant and equipment is recognised in Standalone Statement of Profit and loss.

Capital work-in-progress

Cost of assets not ready for intended use, as on the balance sheet date, is shown as capital work-in-progress. Advances given towards acquisition of property, plant and equipment outstanding at each balance sheet date are disclosed as other non-current assets.

Subsequent Measurement

Subsequent expenditure is capitalised only if it is probable that the future economic benefits associated with the expenditure will flow to the Company.

Depreciation

The Company provides depreciation on Property, Plant and Equipment, other than vehicles and leasehold improvements based on the useful life as determined by the Management.

The depreciation is provided under straight-line method.

Leasehold improvements are amortised over the primary period of the lease or the estimated useful life of the assets, whichever is lower.

Depreciation on additions (disposals) is provided on a prorata basis i.e. from (up to) the date on which asset is ready for use (disposed of).

Depreciation method, useful lives and residual values are reviewed at each financial year-end and adjusted if appropriate. Based on technical evaluation and consequent advice, the management believes that its estimates of useful lives as given above best represent the period over which management expects to use these assets.

Asset category	Estimated useful life (years)
Plant and machinery	5-15
Electrical installations	10
Furniture and fixtures	10
Computers	3
Office equipment	5-10
Vehicles	5

E) Intangible assets

Intangible assets acquired are stated at cost less accumulated amortisation and impairment loss, if any.

Intangible assets are amortised in the Standalone Statement of Profit and Loss over their estimated useful lives from the date they are available for use based on the expected pattern of economic benefits of the asset. Intangible asset is amortised on straight line basis

Asset category	Estimated useful life (Years)
Computer software	3-10
Customer relationships	5-10

Subsequent expenditure is capitalised only when it increases the future economic benefits embodied in the specific asset to which it relates. All other expenditure are recognised in the Standalone statement of profit and loss as incurred.

Amortisation method, useful lives and residual values are reviewed at the end of each financial year and adjusted if appropriate.

An intangible asset is derecognised on disposal, or when no future economic benefits are expected from use or disposal. Gains or losses arising from derecognition of an intangible asset, measured as the difference between the net disposal proceeds and the carrying amount of the asset are recognised in the statement of profit and loss when the asset is derecognised.

F) Intangible assets under development

Research costs are expensed as incurred. Software product development costs are expensed as incurred unless technical and commercial feasibility of the project is demonstrated, future economic benefits are probable, the Company has an intention and ability to complete and use or sell the software and the costs can be measured reliably. The costs which can be capitalized include the cost of software purchased, direct salary and overhead costs that are directly attributable to preparing the asset for its intended use.

These assets are not amortised, but evaluated for potential impairment on an annual basis or when there are indications that the carrying value may not be recoverable. Any impairment is recognised as an expense in the Standalone statement of profit and loss.

If the carrying amount of the assets exceed the estimated recoverable amount, an impairment is recognized for such excess amount. The impairment loss is recognized as an expense in the Statement of Profit and Loss, unless the asset is carried at revalued amount, in which case any impairment loss of the revalued asset is treated as a revaluation decrease to the extent a revaluation reserve is available for that asset.

G) Goodwill

Goodwill on acquisitions of businesses is reported separately from intangible assets.

i) As stated in the approved scheme of amalgamation and arrangement approved by National Company Law Tribunal, Hyderabad goodwill is being amortised over period of 10 years up to 31 March 2021 (Refer Note 43 and Note 44(B)). Further this Goodwill is also tested for impairment at each reporting period and is carried at cost less accumulated amortization and accumulated impairment losses, if any.

The Company has obtained approval from its Board, shareholders, creditors, National Company Law Tribunal ("NCLT") or any other appropriate authority to modify the accounting treatment for Goodwill mentioned (i) above with effect from 1 April 2021. As per the scheme filed and NCLT order received the treatment of Goodwill with effect from 1 April 2021 shall be done as per applicable accounting standards and / or other applicable accounting policy. Accordingly, as per Ind AS 36 - Impairment of Assets, the Company is required to periodically test the impairment on Goodwill.

Goodwill generated through Business Transfer Agreement (Refer Note 43 and Note 44(B)) is tested for impairment annually, and is carried at cost less accumulated impairment, if any.

H) Impairment of non-financial assets

At each reporting date, the Company reviews the carrying amounts of its non-financial assets (other than inventories and deferred tax assets) to determine whether there is any indication on impairment. If any such indication exists, then the asset''s recoverable amount is estimated.

For impairment testing, assets are Companyed together into the smallest Company of assets that generates the cash inflows from continuing use that are largely independent of the cash inflows of other assets or Cash generating unit (CGU).

The recoverable amount of a CGU (or an individual asset) is the higher of its value in use and its fair value less costs to sell. Value in use is based on the estimated future cash flows, discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the CGU (or the asset).

Where it is not possible to estimate the recoverable amount of individual asset, the Company estimates the recoverable amount of the cash-generating unit to which the asset belongs.

An impairment loss is recognised if the carrying amount of an asset or CGU exceeds its recoverable amount.

Impairment loss in respect of assets is reversed only to the extent that the assets carrying amount does not exceed the carrying amount that would have been determined, net of depreciation or amortisation, if no impairment loss had been recognised in prior years. A reversal of impairment loss is recognised immediately in the Statement of Profit and Loss.

I) Foreign currency transactions

Transactions in foreign currencies are recorded by the Company at the exchange rates prevailing at the date when the transaction first qualifies for recognition. Monetary assets and liabilities denominated in foreign currency are translated to the functional currency at the exchange rates prevailing at the reporting date.

Exchange differences arising on settlement or translation of monetary items are recognised in the statement of profit and loss.

Non-monetary items that are measured at historical cost in a foreign currency are translated using the exchange rates at the date of initial transactions. Non-monetary items measured at fair value in a foreign currency are translated using the exchange rates at the date when the fair value is determined.

Foreign currency gains and losses are reported on a net basis in the Standalone Statement of Profit and Loss.

J) Employee benefits

Short-term employee benefits

Short-term employee benefits are expensed as the related service is provided. A liability is recognised for the amount expected to be paid if the Company has a present legal or constructive obligation to pay this amount as a result of past service provided by the employee and the obligation can be estimated reliably.

Defined contribution plans

The Company makes specified monthly contribution towards employee provident fund to Government administered provident fund scheme, which is a defined contribution scheme. The Company''s contribution is recognised as an expense in the Standalone Statement of Profit and Loss during the period in which the employee renders the related service.

A defined contribution plan is a post-employment benefit plan under which an entity pays fixed contributions into a separate entity and will have no legal or constructive obligation to pay further amounts.

Defined benefit plans

A defined benefit plan is a post-employment benefit plan other than a defined contribution plan.

Gratuity

For defined benefit plans in the form of gratuity fund, the cost of providing benefits is determined using the projected unit credit method, with actuarial valuations being carried out at the end of each annual reporting period. The contributions made to the fund are recognised as plan assets. The defined benefit obligation as reduced by fair value of plan assets is recognised in the Standalone Balance Sheet. Re-measurements are recognised in the other comprehensive income, net of tax in the year in which they arise.

When the calculation results in a potential asset for the Company, the recognised asset is limited to the present value of economic benefits available in the form of any future refunds from the plan or reductions in future contributions to the plan. To calculate the present value of economic benefits, consideration is given to any applicable minimum funding requirements.

Remeasurement of the net defined benefit liability, which comprises actuarial gains and losses, the return on plan assets (excluding interest) and the effect of the asset ceiling (if any, excluding interest), are recognised immediately in other comprehensive income. Net interest expense (income) on the net defined liability (assets) is computed by applying the discount rate, used to measure the net defined liability (asset), to the net defined liability (asset) at the start of the financial year after taking into account any changes as a result of contribution and benefit payments during the year. Net interest expense and other expenses related to defined benefit plans are recognised in the Standalone Statement of profit or loss.

When the benefits of a plan are changed or when a plan is curtailed, the resulting change in benefit that relates to past service or the gain or loss on curtailment is recognised immediately in profit or loss. The Company recognises gains and losses on the settlement of a defined benefit plan when the settlement occurs.

Other long-term employee benefits

Compensated absences which are not expected to occur within twelve months after the end of the period in which the employee renders the related service are recognised as a liability at the present value of the defined benefit obligation as at the Balance Sheet date. The cost of providing benefits is determined using the Projected Unit Credit method, with actuarial valuations being carried out at each Balance Sheet date. Actuarial gains and losses are recognised in the Standalone Statement of Profit and Loss in the period in which they occur.

K) Revenue

Revenue (other than for those items to which Ind AS 109 Financial Instruments are applicable) towards satisfaction of a performance obligation is measured at the amount of transaction price (net of variable consideration, if any) allocated to that performance obligation. The transaction price of services rendered is net of variable consideration on account of various discounts and claims accepted by the Company as part of the contract. Ind AS 115 Revenue from contracts with customers outlines a single comprehensive model of accounting for revenue arising from contracts with customers and supersedes current revenue recognition guidance found within Ind ASs. Revenue is recognised upon transfer of control of promised products or services to customers in an amount

that reflects the consideration we expect to receive in exchange for those products or services. The effect on adoption of Ind AS 115 was insignificant.

Revenue from registry and related services and communication services is recognised on the basis of services rendered to customers, in accordance with the terms and conditions of the contracts entered into by the Company with each customer provided, the revenue is reliably determinable, and no significant uncertainty exist regarding the collection.

I ncome from pension fund solutions represents services which are recognised as per the terms of the contract with customers, when such related services are rendered.

Revenue from data processing services is recognised based on the services rendered, in accordance with the terms of the contract, either on a time cost basis or on the basis of number of enumerations processed.

Recoverable expenses represent expenses incurred to related to service performed and are recognised on the basis of billing to customers, in accordance with the terms and conditions of the agreements entered into by the Company with each customer.

Work-in-progress (unbilled revenue) represents revenue from services rendered, recognised based on services performed in advance of billing based on the terms and conditions mentioned in the agreements with the customers.

L) Other income

Interest income from a financial asset is recognised when it is probable that the economic benefits will flow to the Company and the amount of income can be measured reliably. Interest income is accrued on a time basis, by reference to the principal outstanding and at the effective interest rate applicable, which is the rate that exactly discounts estimated future cash receipts through the expected life of the financial asset to that asset''s net carrying amount on initial recognition. Interest income is included in other income in the Standalone Statement of Profit and Loss.

Dividends are recognised in Standalone Statement of Profit or Loss only when the right to receive payment is established, it is probable that the economic benefits associated with the dividend will flow to the Company, and the amount of the dividend can be measured reliably.

M) Borrowings and related cost

Borrowings are initially recognised at fair value, net of transaction costs incurred. Borrowings are subsequently measured at amortised cost. Any difference between the proceeds (net of transaction costs) and the redemption amount is recognised in profit or loss over the period of the borrowings using the effective interest method.

Borrowing costs are expensed in the period in which they occur. Borrowing costs consist of interest and other costs that an entity incurs in connection with the borrowing of funds.

Borrowings are classified as current liabilities unless the Company has an unconditional right to defer settlement of the liability for at least 12 months after the reporting period.

N) Contract balances

Contract assets: The Company classifies its right to consideration in exchange for deliverables as either a receivable or as unbilled revenue. A receivable is a right to consideration that is unconditional upon passage of time. Revenues in excess of billings is recorded as unbilled revenue and is classified as a financial asset where the right to consideration is unconditional upon passage of time.

Contract liabilities: A contract liability (which we referred to as Unearned Revenue) is the obligation to transfer goods or services to a customer for which the Company has received consideration (or an amount of consideration is due) from the customer. If a customer pays consideration before the Company transfers goods or services to the customer, a contract liability is recognised when the payment is received.

O) Trade receivables

Trade receivables are amounts due from customers for services rendered in the ordinary course of business. Trade receivables are recognised initially at the amount of consideration that is unconditional unless they contain significant financing components, when they are recognised at fair value. The Company holds trade receivables with the objective to collect the contractual cash flows and therefore measures them subsequently at amortised cost, less provision for expected credit loss.

P) Provisions, contingent liabilities and contingent assets

Provisions are recognised when there is a present obligation (legal or constructive) as a result of a past event and it is probable ("more likely than not") that it is required to settle the obligation, and a reliable estimate can be made of the amount of the obligation. The amount recognised as a provision is the best estimate of the consideration required to settle the present obligation at the balance sheet date, considering the risks and uncertainties surrounding the obligation.

If the effect of the time value of money is material, provisions are determined by discounting the expected future cash flows at a pre-tax rate that reflects current market assessments of the time value of money and the risks specific to the liability. When discounting is used, the increase in the provision due to the passage of time is recognised as a finance cost.

Contingent liabilities are possible obligations that arise from past events and whose existence will only be confirmed by the occurrence or non-occurrence of one or more future events not wholly within the control of the entity. Where it is not probable that an outflow of economic benefits will be required, or the amount cannot be estimated reliably, the obligation is disclosed as a contingent liability, unless the probability of outflow of economic benefits is remote.

Contingent assets are not recognised in the Standalone Financial Statement but disclosed, where an inflow of economic benefit is probable.

A contract is considered as onerous when the expected economic benefits to be derived by the Company from the contract are lower than the unavoidable cost of meeting its obligations under the contract. The provision for an onerous contract is measured at the lower of the expected cost of terminating the contract and the expected net cost of continuing with the contract. Before a provision is established, the Company recognises any impairment loss on the assets associated with that contract.

Q) Financial instruments

Business model assessment

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

include derivative contracts such as foreign currency forward contracts, embedded derivatives in the host contract, etc.

Financial assets

Initial recognition and measurement

The Company initially recognises trade receivables and debt securities issued on the date on which they are originated. The Company recognises the other financial assets on the trade date, which is the date on which the Company becomes a party to the contractual provision of the instrument.

All financial assets are recognised initially at fair value, plus in the case of financial assets are recorded at fair value through profit or loss (FVTPL), transaction costs that are attributable to the acquisition of the financial asset. However, trade receivables which do not contain a significant financial component are measured at transaction value.

Classifications and subsequent measurement

Classifications

The Company classifies its financial assets as subsequently measured at either amortised cost or fair value depending on the Company''s business model for managing the financial assets and the contractual cash flow characteristics of the financial assets.

Business model assessment

The Company makes an assessment of the objective of a business model in which an asset is held at a portfolio level because this best reflects the way the business is managed and information is provided to management.

Assessment whether contractual cash flows are solely payments of principal and interest

I n assessing whether the contractual cash flows are solely payments of principal and interest, the Company considers the contractual terms of the instrument. This includes assessing whether the financial asset contains a contractual term that could change the timing or amount of contractual cash flows such that it would not meet this condition.

Debt instrument at amortised cost

A financial asset is measured at amortised cost if it meets both of the following conditions and is not designated as at Fair value though profit and loss (FVTPL):

a) it is held within a business model whose objective is to hold assets in order to collect contractual cash flows; and

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

After initial measurement, such financial assets are subsequently measured at amortised cost using the Effective Interest Rate (''EIR'') method. Amortised cost is calculated by considering any discount or premium on acquisition and fees or costs that are an integral part of the EIR. The EIR amortisation is included as finance income in the profit or loss. The losses arising from impairment are recognised in the profit or loss.

Debt instrument at fair value through Other Comprehensive Income (FVOCI)

A financial asset is measured at FVOCI only if both of the following conditions are met:

a) i t is held within a business model whose objective is achieved by both collecting contractual cash flows and selling financial assets.

b) the contractual terms of the financial asset represent contractual cash flows that are solely payments of principal and interest.

After initial measurement, such financial assets are subsequently measured at fair value with changes in fair value recognised in other comprehensive income (OCI). Interest income is recognised basis EIR method and the losses arising from ECL impairment are recognised in the Standalone Statement of Profit or Loss.

Debt instrument at fair value through profit and loss (FVTPL)

Any debt instrument, which does not meet the criteria for categorisation as at amortised cost or as FVOCI, is classified as at FVTPL.

These assets are subsequently measured at fair value. Net gains and losses, including any interest or dividend income are recognized in Standalone Statement of Profit or Loss.

Reclassification of financial assets

Financial assets are not reclassified subsequent to their initial recognition, except in the period after the Company changes its business model for managing financial assets.

Derecognition of financial assets

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

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

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

Impairment of financial assets

The Company recognises loss allowances for expected credit losses on financial assets measured at amortised cost. At each reporting date, the Company assesses whether financial assets carried at amortised cost are credit impaired. A financial asset is ''credit impaired'' when one or more events that have a detrimental impact on the estimated future cash flows of the financial asset have occurred.

Evidence that a financial asset is credit impaired includes the following observable data:

• significant financial difficulty of the borrower or issuer;

• a breach of contract;

• it is probable that the borrower will enter bankruptcy or other financial reorganization; or

• t he disappearance of an active market for security because of financial difficulties.

The Company measures loss allowances at an amount equal to lifetime expected credit losses.

Loss allowances for trade receivables are always measured at an amount equal to lifetime expected credit losses.

Lifetime expected credit losses are the expected credit losses that result from all possible default events over the expected life of a financial instrument.

12-month expected credit losses are the portion of expected credit losses that result from default events that are possible within 12 months after the reporting date (or a shorter period if the expected life of the instrument is less than 12 months).

In all cases, the maximum period considered when estimating expected credit losses is the maximum contractual period over which the Company is exposed to credit risk.

When determining whether the credit risk of a financial asset has increased significantly since initial recognition and when estimating expected credit losses, the Company considers reasonable and or effort. This includes both quantitative and qualitative information and analysis, based on the Company''s historical experience and supportable information that is relevant and available without undue cost or effort. This includes both quantitative and qualitative information and analysis, based on the Company''s historical experience and informed credit assessment and including forward looking information.

Measurement of expected credit losses

Expected credit losses are a probability weighted estimate of credit losses. Credit losses are measured as the present value of all cash shortfalls (i.e. the difference between the cash flows due to the Company in accordance with the contract and the cash flows that the Company expects to receive).

Presentation of allowance for expected credit losses in the Standalone Balance Sheet

Loss allowances for financial assets measured at amortised cost are deducted from the gross carrying amount of the assets.

Write-off

The gross carrying amount of a financial asset is written off (either partially or in full) to the extent that there is

no realistic prospect of recovery. This is generally the case when the Company determines that the debtor does not have assets or sources of income that could generate sufficient cash flows to repay the amounts subject to the write off. However, financial assets that are written off could still be subject to enforcement activities in order to comply with the Company''s procedures for recovery of amounts due.

Financial liabilities

Initial recognition and measurement

Financial liabilities are classified, at initial recognition, as financial liabilities at fair value through profit or loss, amortised cost, as appropriate.

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

Classification and subsequent measurement

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

After initial recognition, financial liabilities are measured at amortised cost using the effective interest rate (EIR) method. Gains and losses are recognised in profit or loss when the liabilities are derecognised as well as through the EIR amortisation process.

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

Financial liabilities at fair value through profit or loss

Financial liabilities at fair value through profit or loss include financial liabilities designated upon initial recognition as at fair value through profit or loss.

Gains or losses on liabilities held for trading are recognised in the Standalone Statement of Profit or Loss.

Financial liabilities

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

Derecognition of financial liabilities

Company derecognizes a financial liability when its contractual obligations are discharged or cancelled, or expire. Company also derecognizes a financial liability when its terms are modified and the cash flows under the modified terms are substantially different. In this case, a new financial liability based on the modified terms is recognized at fair value. The difference between the carrying amount of the financial liability extinguished and a new financial liability with modified terms is recognized in the Standalone Statement of Profit or Loss.

Offsetting of financial instruments

Financial assets and financial liabilities are offset and the net amount is reported in the balance sheet when there is a legally enforceable right to offset the recognised amounts and there is an intention to settle on a net basis, or realise the asset and settle the liability simultaneously (''the offset criteria'').

R) Income taxes

Income tax comprises current and deferred tax. It is recognised in profit or loss except to the extent that it relates to a business combination or to an item recognised directly in equity or in other comprehensive income.

Current tax

Current tax comprises the expected tax payable or receivable on the taxable income or loss for the year and any adjustment to the tax payable or receivable in respect of previous years. The amount of current tax reflects the best estimate of the tax amount expected to be paid or received after considering the uncertainty, if any, related to

income taxes. It is measured using tax rates (and tax laws) enacted or substantively enacted by the reporting date.

Current tax assets and current tax liabilities are offset only if there is a legally enforceable right to set off the recognised amounts, and it is intended to realise the asset and settle the liability on a net basis or simultaneously.

Deferred tax

Deferred tax is recognised on differences between the carrying amounts of assets and liabilities in the balance sheet and the corresponding tax bases used in the computation of taxable profit. Deferred tax liabilities are generally recognised for all taxable temporary differences. Deferred tax assets are generally recognised for all deductible temporary differences to the extent that it is probable that taxable profits will be available against which those deductible temporary differences can be utilised. Such assets and liabilities are not recognised if the temporary difference arises from initial recognition of goodwill or from the initial recognition (other than in a business combination) of other assets and liabilities in a transaction that affects neither the taxable profit nor the accounting profit.

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

Unrecognised deferred tax assets are reassessed at each reporting date and recognised to the extent that it has become probable that future taxable profits will be available against which they can be used.

Deferred tax assets and liabilities are measured at the tax rates that are expected to apply in the period in which the liability is settled or the asset realised, based on tax rates (and tax laws) that have been enacted or substantively enacted by the balance sheet date. The measurement of deferred tax liabilities and assets reflects the tax consequences that would follow from the manner in which the Company expects, at the reporting date, to recover or settle the carrying amount of its assets and liabilities.

Deferred tax assets and liabilities are offset when there is a legally enforceable right to set off current tax assets against current tax liabilities and when they relate to income taxes levied by the same taxation authority and

Deferred tax (continued)

the Company intends to settle its current tax assets and liabilities on a net basis.

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

Deferred tax liabilities are not recognised for temporary differences between the carrying amount and tax bases of investments in subsidiaries where the Company is able to control the timing of the reversal of the temporary differences and it is probable that the differences will not reverse in the foreseeable future.

S) Segment reporting

Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision maker.

The Board of directors of the Company have been identified as being the Chief operating decision maker by the management of the Company.

T) Cash and cash equivalents