Accounting Policies of Nuvama Wealth Management Ltd. Company

Mar 31, 2025

Summary of Material accounting policy
information

1.2 Basis of preparation of standalone
financial statements

The standalone financial statements have been
prepared in accordance with Indian Accounting
Standards (Ind AS) notified under the Companies
(Indian Accounting Standards) Rules, 2015 (as
amended from time to time). These standalone
financial statements have been approved for issue
by the Board of Directors of the Company on May 28,
2025.

These standalone financial statements have been
prepared on a historical cost basis, except for
certain financial instruments such as derivative
financial instruments and other financial assets held
for trading, which have been measured at fair value.
The standalone financial statements are presented
in Indian Rupees (Rs.) and all values are rounded
off to the nearest million, except when otherwise
indicated.

1.3 Presentation of standalone financial
statements

The Company presents its standalone balance sheet
in order of liquidity in compliance with the Division
III of the Schedule III to the Companies Act, 2013.
An analysis regarding recovery or settlement within
12 months after the reporting date (current) and
more than 12 months after the reporting date (non¬
current) is presented in note 2.35.

Financial assets and financial liabilities are generally
reported gross in the standalone balance sheet. They
are only offset and reported net when, in addition
to having an unconditional legally enforceable right
to offset the recognised amounts without being
contingent on a future event, the parties also
intend to settle on a net basis in all of the following
circumstances:

1. The normal course of business

2. The event of default

3. The event of insolvency or bankruptcy of the
Company and/or its counterparties

1.4 Revenue from contract with customer

Revenue is measured at transaction price i.e. the
amount of consideration to which the Company
expects to be entitled in exchange for transferring
promised goods or services to the customer,
excluding amounts collected on behalf of third
parties. The Company consider the terms of the
contracts and its customary business practices
to determine the transaction price. Where the
consideration promised is variable, the Company
excludes the estimates of variable consideration
that are constrained. The Company applies the five-
step approach for recognition of revenue:

i) Identification of contract(s) with customers;

ii) Identification of the separate performance
obligations in the contract;

iii) Determination of transaction price;

i v) Allocation of transaction price to the separate
performance obligations; and

v) Recognition of revenue when (or as) each
performance obligation is satisfied

The Company recognises revenue from the following

sources:

• Brokerage income is recognised as per contracted
rates at the point in time when transaction''s
performance obligation is satisfied on behalf of the
customers on the trade date.

• Fee income including merchant banking and advisory
fees is accounted on an accrual basis as per Ind
AS 115 in accordance with the terms and contracts
entered with the client.

• Research services fee income is accounted when
there is reasonable certainty as to its receipts.

• Interest income is recognized on accrual basis.

• Rental income is accounted on a straight-line basis
over the lease terms on operating leases.

• Dividend income is recognised when the right to
receive payment is established, it is probable that
the economic benefits associated with the dividend
will flow to the entity and the amount of the dividend
can be measured reliably.

1.5 Financial Instruments

Date of recognition

Financial assets and financial liabilities with exception
of borrowings are initially recognised on the trade
date, i.e., the date that the Company becomes a party
to the contractual provisions of the instrument. This
includes regular way trades; purchases or sales of
financial assets that require delivery of assets within
the time frame generally established by regulation
or convention in the market place. The Company
recognises borrowings when funds are received by
the Company.

Initial measurement of financial instruments

Financial assets are classified, at initial recognition,
as subsequently measured at amortised cost, fair
value through other comprehensive income (OCI),
and fair value through profit or loss.

The classification of financial assets at initial
recognition depends on the financial asset''s
contractual cash flow characteristics and the
Company''s business model for managing them. With
the exception of trade receivables that do not contain
a significant financing component or for which the
Company has applied the practical expedient, the
Company initially measures a financial asset at its
fair value plus, in the case of a financial asset not at

fair value through profit or loss, transaction costs.
Trade receivables that do not contain a significant
financing component or for which the Company has
applied the practical expedient are measured at the
transaction price determined under Ind AS 115. Refer
to the accounting policies note no 1.4.

Day 1 profit or loss

When the transaction price of the financial
instrument differs from the fair value at origination
and the fair value is based on a valuation technique
using only inputs observable in market transactions,
the Company recognises the difference between
the transaction price and fair value in net gain on
fair value changes. In those cases where fair value
is based on models for which some of the inputs
are not observable, the difference between the
transaction price and the fair value is deferred and
is only recognised in statement of profit and loss
when the inputs become observable, or when the
instrument is derecognised.

Classification of financial instruments

The Company classifies all of its financial assets
based on the business model for managing the
assets and the asset''s contractual terms, measured
at either:

Financial assets carried at amortised cost
(AC)

A financial asset is measured at amortised cost if
it is held within a business model whose objective
is to hold the asset in order to collect contractual
cash flows and 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. The changes in
carrying value of financial assets is recognised in
profit and loss account.

Financial assets at fair value through other
comprehensive income (FVTOCI)

A financial asset is measured at FVTOCI if it is held
within a business model whose objective is achieved
by both collecting contractual cash flows and selling
financial assets and 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. The
changes in fair value of financial assets is recognised
in Other Comprehensive Income.

Financial assets at fair value through profit
or loss (FVTPL)

A financial asset which is not classified in any of
the above categories are measured at FVTPL. The
Company measures all financial assets classified
as FVTPL at fair value at each reporting date. The
changes in fair value of financial assets is recognised
in Profit and loss account.

The Company measures financial assets that meet
the following conditions at amortised cost:

• the financial asset is held within a business
model whose objective is to hold financial
assets in order to collect contractual cash
flows; and

• 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.

Debt instruments that meet the following conditions
are subsequently measured at fair value through
other comprehensive income (except for debt
instruments that are designated as at fair value
through profit or loss on initial recognition):

• the financial asset is held within a business
model whose objective is achieved both by
collecting contractual cash flows and selling the
financial assets; and

• 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

1.6 Financial assets and liabilities

Amortized cost and effective interest rate
(EIR)

The effective interest rate is a method of calculating
the amortised cost of a debt instrument and of
allocating interest income over the relevant period.

For financial instruments other than purchased
or originated credit-impaired financial assets,
the effective interest rate is the rate that exactly
discounts estimated future cash receipts (including
all fees and points paid or received that form an
integral part of the effective interest rate, transaction
costs and other premiums or discounts) excluding

expected credit losses, through the expected life
of the debt instrument, or, where appropriate, a
shorter period, to the gross carrying amount of the
debt instrument on initial recognition. For purchased
or originated credit impaired financial assets, a
credit-adjusted effective interest rate is calculated
by discounting the estimated future cash flows,
including expected credit losses, to the amortised
cost of the debt instrument on initial recognition.

The amortised cost of a financial asset is the amount
at which the financial asset is measured at initial
recognition minus the principal repayments, plus
the cumulative amortisation using the effective
interest method of any difference between that
initial amount and the maturity amount, adjusted
for any loss allowance. On the other hand, the gross
carrying amount of a financial asset is the amortised
cost of a financial asset before adjusting for any loss
allowance.

Financial assets held for trading

The Company classifies financial assets as held for
trading when they have been purchased or issued
primarily for short-term profit making through
trading activities or form part of a portfolio of
financial instruments that are managed together, for
which there evidence of a recent pattern of short¬
term profit is taking. Held-for-trading assets and
liabilities are recorded and measured in the balance
sheet at fair value.

Financial assets at fair value through profit
or loss

Financial assets and financial liabilities in this
category are those that are not held for trading and
have been either designated by management upon
initial recognition or are mandatorily required to be
measured at fair value under Ind AS 109. Management
only designates an instrument at FVTPL upon initial
recognition when one of the following criteria are met.
Such designation is determined on an instrument-
by-instrument basis.

• The designation eliminates, or significantly
reduces, the inconsistent treatment that would
otherwise arise from measuring the assets or
liabilities or recognizing gains or losses on them
on a different basis; Or

• The liabilities are part of a group of financial
liabilities, which are managed and their

performance evaluated on a fair value basis,
in accordance with a documented risk
management or investment strategy; Or

• The liabilities containing one or more embedded
derivatives, unless they do not significantly
modify the cash flows that would otherwise be
required by the contract, or it is clear with little
or no analysis when a similar instrument is first
considered that separation of the embedded
derivative(s) is prohibited.

Financial assets and financial liabilities at FVTPL are
recorded in the standalone balance sheet at fair
value. Changes in fair value are recorded in profit and
loss with the exception of movements in fair value of
liabilities designated at FVTPL due to changes in the
Company''s own credit risk. Such changes in fair value
are recorded in the own credit reserve through OCI
and do not get recycled to the profit or loss. Interest
earned or incurred on instruments designated at
FVTPL is accrued in interest income or finance cost,
respectively, using the EIR, taking into account any
discount/ premium and qualifying transaction costs
being an integral part of instrument. Interest earned
on assets mandatorily required to be measured at
FVTPL is recorded using contractual interest rate.

Investment in equity instruments

The Company subsequently measures all equity
investments at fair value through profit or loss, unless
the management has elected to classify irrevocably
some of its strategic equity investments to be
measured at FVOCI, when such instruments meet
the definition of Equity under Ind AS and are not
held for trading. Such classification is determined on
an instrument-by-instrument basis. Investments in
subsidiaries and associate companies are carried at
cost.

Financial liabilities

All financial liabilities are measured at amortised
cost except loan commitments, financial guarantees,
and derivative financial liabilities.

Debt securities and other borrowed funds

After initial measurement, debt securities and
other borrowed funds are subsequently measured
at amortised cost. Amortised cost is calculated by
taking into account any discount or premium on
issue funds, and costs that are an integral part of the
EIR.

Financial guarantee

Financial guarantees are contracts that require the
Company to make specified payments to reimburse
to holder for loss that it incurs because a specified
debtor fails to make payment when it is due in
accordance with the terms of a debt instrument.

Financial guarantee issued or commitments to
provide a loan at below market interest rates are
initially measured at fair value and the initial fair value
is amortised over the life of the guarantee or the
commitment. Subsequently, they are measured at
higher of the amount of loss allowance determined
as per impairment requirements of Ind AS 109 and
the amount recognised less cumulative amortisation.

Financial liabilities and equity instruments

Financial instruments issued by the Company are
classified as either financial liabilities or as equity in
accordance with the substance of the contractual
arrangements and the definitions of a financial
liability and an equity instrument.

An equity instrument is any contract that evidences
a residual interest in the assets of an entity after
deducting all of its liabilities. Equity instruments
issued by the Company are recognised at the
proceeds received, net of direct issue costs.

Repurchase of the Company''s own equity
instruments is recognised and deducted directly in
equity. No gain or loss is recognised in profit or loss
on the purchase, sale, issue or cancellation of the
Company''s own equity instruments.

1.7 Reclassification of financial assets
and liabilities

The Company does not reclassify its financial assets
subsequent to their initial recognition, apart from the
exceptional circumstances in which the Company
acquires, disposes of, or terminates a business line.

1.8 Derecognition of financial instruments

Derecognition of financial asset

A financial asset (or, where applicable a part of a
financial asset or a part of a group of similar financial
assets) is derecognised when the rights to receive
cash flows from the financial asset have expired.
The Company also derecognises the financial asset
if it has both transferred the financial asset and the
transfer qualifies for derecognition.

The Company has transferred the financial asset if,
and only if, either

• The Company has transferred the rights to
receive cash flows from the financial asset or

• It retains the contractual rights to receive the
cash flows of the financial asset, but assumed a
contractual obligation to pay the cash flows in
full without material delay to third party under
pass through arrangement.

Pass-through arrangements are transactions whereby
the Company retains the contractual rights to
receive the cash flows of a financial asset (the
''original asset''), but assumes a contractual obligation
to pay those cash flows to one or more entities
(the ''eventual recipients''), when all of the following
conditions are met:

• The Company has no obligation to pay amounts
to the eventual recipients unless it has collected
equivalent amounts from the original asset,
excluding short-term advances with the right
to full recovery of the amount lent plus accrued
interest at market rates.

• The Company cannot sell or pledge the original
asset other than as security to the eventual
recipients.

• The Company has to remit any cash flows it
collects on behalf of the eventual recipients
without material delay. In addition, the
Company is not entitled to reinvest such cash
flows, except for investments in cash or cash
equivalents including interest earned, during
the period between the collection date and
the date of required remittance to the eventual
recipients.

A transfer only qualifies for derecognition if either:

• The Company has transferred substantially all
the risks and rewards of the asset; or

• The Company has neither transferred nor
retained substantially all the risks and rewards
of the asset, but has transferred control of the
asset.

The Company considers control to be transferred
if and only if, the transferee has the practical ability
to sell the asset in its entirety to an unrelated third
party and is able to exercise that ability unilaterally

and without imposing additional restrictions on the
transfer.

Derecognition of financial liabilities

A financial liability is derecognised when the
obligation under the liability is discharged, cancelled
or expires. Where an existing financial liability is
replaced by another from the same lender on
substantially different terms, or the terms of an
existing liability are substantially modified, such an
exchange or modification is treated as a derecognition
of the original liability and the recognition of a new
liability. The difference between the carrying value of
the original financial liability and the consideration
paid is recognised in the statement of profit or loss.

1.9 Impairment of financial assets

The Company records allowance for expected
credit loss (ECL) for all financial assets, other than
financial assets held at FVTPL together with financial
guarantee contracts.

Simplified approach

The Company follows ''simplified approach'' for
recognition of impairment loss allowance on trade
receivables. The application of simplified approach
does not require the Company to track changes
in credit risk. Rather, it recognises impairment loss
allowance based on lifetime ECLs at each reporting
date, right from its initial recognition. The Company
uses a provision matrix to determine impairment
loss allowance on portfolio of its receivables. The
provision matrix is based on its historically observed
default rates over the expected life of the receivables
and is adjusted for forward-looking estimates.

1.10Determination of fair value

The Company measures financial instruments, such
as, derivatives at fair value at each balance sheet
date. Fair value is the price that would be received
to sell an asset or paid to transfer a liability in an
orderly transaction between market participants at
the measurement date. The fair value measurement
is based on the presumption that the transaction
to sell the asset or transfer the liability takes place
either:

• I n 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 by the Company.

The fair value of an asset or a liability is measured
using the assumptions that market participants
would use when pricing the asset or liability,
assuming that market participants act in their
economic best interest. A fair value measurement
of a non-financial asset takes into account a market
participant''s ability to generate economic benefits
by using the asset in its highest and best use or by
selling it to another market participant that would use
the asset in its highest and best use. The Company
uses valuation techniques that are appropriate in
the circumstances and for which sufficient data are
available to measure fair value, maximising the use
of relevant observable inputs and minimising the
use of unobservable inputs. In order to show how
fair values have been derived, financial instruments
are classified based on a hierarchy of valuation
techniques, as summarised below:

Level 1 financial instruments:

Those where the inputs used in the valuation are
unadjusted quoted prices from active markets for
identical assets or liabilities that the Company has
access to at the measurement date. The Company
considers markets as active only if there are sufficient
trading activities with regards to the volume and
liquidity of the identical assets or liabilities and
when there are binding and exercisable price quotes
available on the balance sheet date.

Level 2 financial instruments

Those where the inputs that are used for valuation
and are significant, are derived from directly or
indirectly observable market data available over the
entire period of the instrument''s life.

Level 3 financial instruments

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

For assets and liabilities that are recognised in
the financial statements on a recurring basis, the
Company determines whether transfers have
occurred between levels in the hierarchy by re¬
assessing categorization (based on the lowest level
input that is significant to the fair value measurement
as a whole) at the end of each reporting period.
The Company periodically reviews its valuation

techniques including the adopted methodologies
and model calibrations.

Therefore, the Company applies various techniques
to estimate the credit risk associated with its
financial instruments measured at fair value, which
include a portfolio-based approach that estimates
for the expected net exposure per counterparty over
the full lifetime of the individual assets, in order to
reflect the credit risk of the individual counterparties
for non-collateralised financial instruments.

The Company evaluates the levelling at each
reporting period on an instrument-by-instrument
basis and reclassifies instruments when necessary
based on the facts at the end of the reporting period.

1.11 Write-offs

Financial assets are written off either partially or
in their entirety only when the Company has no
reasonable expectation of recovery.

1.12 Property, plant and equipment,
Right-of-use assets and Capital work
in progress

Property, plant and equipment is stated at cost
excluding the costs of day-to-day servicing, less
accumulated depreciation and accumulated

impairment in value. Changes in the expected useful
life are accounted for by changing the amortization
period or methodology, as appropriate, and treated
as changes in accounting estimates.

Depreciation is recognized so as to write off the cost
of assets less their residual values over their useful
lives. Depreciation is provided on a written down
value basis from the date the asset is ready for its
intended use. In respect of assets sold, depreciation
is provided upto the date of disposal.

An item of property, plant and equipment is
derecognised upon disposal or when no future
economic benefits are expected to arise from the
continued use of the asset. The carrying amount
of those components which have been separately
recognised as assets is derecognised at the time of
replacement thereof. Any gain or loss arising on the
disposal or retirement of an item of property, plant
and equipment is determined as the difference
between the sales proceeds and the carrying
amount of the asset and is recognised in profit or
loss.

As per the requirement of Schedule II of the
Companies Act, 2013, the Company has evaluated
the estimated useful lives of the respective fixed
assets which are as per the provisions of Part C of
Schedule II of the Act for calculating the depreciation.

Right-of-use assets are presented together with
property, plant and equipment in the statement of
financial position - refer to the accounting policy
1.20. Right-of-use assets are depreciated on a
straight-line basis over the lease term.

The residual values, useful lives and methods of
depreciation of property, plant and equipment are
reviewed at each financial year end and adjusted
prospectively, if appropriate.

Leasehold improvements are amortized on a
straight-line basis over the estimated useful lives of
the assets or the period of lease whichever is shorter.

Measurement of land and building under
revaluation model:

Increases in the carrying amount arising on
revaluation of land and buildings are credited to other
comprehensive income and shown as a revaluation
reserve in shareholders'' equity. An exception is
a gain on revaluation that reverses a revaluation
decrease (impairment) on the same asset previously
recognised as an expense. Decreases that offset
previous increases of the same asset are charged in
other comprehensive income and debited against
the revaluation reserve directly in equity; all other
decreases are charged to profit or loss. An annual
transfer from the revaluation surplus to retained
earnings is made for the difference between
depreciation based on the revalued carrying amount

of the asset and depreciation based on the asset''s
original cost. Each year the difference between
depreciation based on the revalued carrying amount
of the asset charged to profit or loss and depreciation
based on the asset''s original cost is transferred from
the revaluation reserve to retained earnings.

1.13 Intangible assets

The Company''s intangible assets mainly include the
value of software. An intangible asset is recognised
only when its cost can be measured reliably and
it is probable that the expected future economic
benefits that are attributable to it will flow to the
Company.

I ntangible assets acquired separately are measured
on initial recognition at cost. The cost of intangible
assets acquired in a business combination is their
fair value as at the date of acquisition. Following initial
recognition, intangible assets are carried at cost less
any accumulated amortisation and any accumulated
impairment losses. Intangible assets with finite
lives are amortized over the useful economic life
and assessed for impairment whenever there is an
indication that the intangible asset may be impaired.

An intangible asset is derecognised upon disposal
(i.e., at the date the recipient obtains control) or
when no future economic benefits are expected
from its use or disposal. Any gain or loss arising
upon derecognition of the asset (calculated as the
difference between the net disposal proceeds and
the carrying amount of the asset) is included in the
statement of profit or loss.

1.14 Investment properties

I nvestment Properties are properties held to earn
rentals and/or capital appreciation. Upon initial
recognition, an investment property is measured
at cost, including transaction costs. Subsequent
to the initial recognition, investment property is
reported at cost less accumulated depreciation and
accumulated impairment losses, if any.

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.

Transfers to (or from) investment property are made
only when there is a change in use. Transfers between
investment property, owner-occupied property do
not change the carrying amount of the property
transferred and they do not change the cost of that
property for measurement or disclosure purpose.

Depreciation is recognised using written down
method so as to write off the cost of the investment
property less their residual values over their useful
lives specified in schedule II to the Companies Act,
2013 or in the case of assets where the useful life was
determined by technical evaluation, over the useful
life so determined.

Depreciation method is reviewed at each financial
year end to reflect the expected pattern of
consumption of the future benefits embodied in
the investment property. The estimated useful
life and residual values are also reviewed at each
financial year end and the effect of any change in the
estimates of useful life/residual value is accounted
on prospective basis.

Investment properties are de-recognised either
when it has been disposed of or when it is
permanently withdrawn from use and no future
economic benefit is expected from its disposal. The
difference between the net disposal proceeds and
the carrying amount of the asset is recognised in
the statement of profit and loss in the period of de¬
recognition.

1.15 Impairment of non-financial assets

The Company assesses at each balance sheet date
whether there is any indication that an asset may
be impaired. If any indication exists, or when annual
impairment testing for an asset is required, the
Company estimates the asset''s recoverable amount.
An asset''s recoverable amount is the higher of an
asset''s or cash-generating unit''s (CGU) fair value less
costs of disposal and its value in use. The recoverable
amount is determined for an individual asset, unless

the asset does not generate cash inflows that are
largely independent of those from other assets or
groups of assets. When the carrying amount of an
asset or CGU exceeds its recoverable amount, the
asset is considered impaired and is written down to
its recoverable amount.

1.16 Securities held for trading

a) The securities acquired with the intention of
short term holding and trading positions are
considered as securities held for trading.

b) The securities, including from error trades,
held as securities held for trading are valued at
market value.

1.17 Cash and cash equivalents

Cash and cash equivalents include cash on hand and
on bank and other short term highly liquid investments
with original maturities of upto three months that are
readily convertible to known amounts of cash and
which are subject to an insignificant risk of changes
in value.

1.18 Foreign currency transactions

The standalone financial statements are presented
in Indian Rupees which is also functional currency of
the Company. Transactions in currencies other than
Indian Rupees (i.e. foreign currencies) are recognised
at the rates of exchange prevailing at the dates of the
transactions. At the end of each reporting period,
monetary items denominated in foreign currencies
are retranslated at the rates prevailing at that date.
Non-monetary items carried at fair value that are
denominated in foreign currencies are retranslated
at the rates prevailing at the date when the fair
value was determined. Non-monetary items that
are measured in terms of historical cost in a foreign
currency are not retranslated.

Exchange differences on monetary items are
recognised in profit or loss in the period in which
they arise. The gain or loss arising on translation
of non-monetary items measured at fair value is
treated in line with the recognition of the gain or loss
on the change in fair value of the item (i.e., translation
differences on items whose fair value gain or loss is
recognised in OCI or profit or loss are also recognised
in OCI or profit or loss, respectively)

1.19 Retirement and other employee
benefits

Provident fund and national pension
scheme

The Company contributes to a recognized provident
fund and national pension scheme which is a
defined contribution scheme. The contributions are
accounted for on an accrual basis and recognized in
the standalone statement of profit and loss.

Gratuity

The Company''s gratuity scheme is a defined benefit
plan. The Company''s net obligation in respect of the
gratuity benefit scheme is calculated by estimating
the amount of future benefit that the employees
have earned in return for their service in the current
and prior periods. Such benefit is discounted to
determine its present value, and the fair value of any
plan assets, if any, is deducted.

The present value of the obligation under such
benefit plan is determined based on independent
actuarial valuation using the Projected Unit Credit
Method. Benefits in respect of gratuity are funded
with an Insurance Company approved by Insurance
Regulatory and Development Authority (IRDA).

Re-measurement, comprising of actuarial gains
and losses, the effect of the asset ceiling, excluding
amounts included in net interest on the net defined
benefit liability, are recognised immediately in the
balance sheet with a corresponding debit or credit
to retained earnings through OCI in the period in
which they occur.

Remeasurement are not reclassified to profit or loss
in subsequent periods.

Compensated Leave Absences

The eligible employees of the Company are
permitted to carry forward certain number of their
annual leave entitlement to subsequent years,
subject to a ceiling. The Company recognises the
charge to the standalone statement of profit and
loss and corresponding liability on account of such
accumulated leave entitlement based on a valuation
by an independent actuary. The cost of providing
annual leave benefits are determined using the
projected unit credit method.

Share-based payment arrangements

Equity-settled share-based payments to employees
by the Company and by the erstwhile ultimate parent
Group are measured by reference to the fair value of
the equity instruments at the grant date.

The fair value of Equity-settled share-based
payments determined at the grant date is expensed
over the vesting period, based on the Company''s
estimate of equity instruments that will eventually
vest, with a corresponding increase in equity. In
cases where the share options granted vest in
instalments over the vesting period, the Company
treats each instalment as a separate grant, because
each instalment has a different vesting period, and
hence the fair value of each instalment differs.

1.20 Income tax expenses

I ncome tax expense represents the sum of the tax
currently payable and deferred tax.

Current tax

The tax currently payable is based on taxable profit for
the year. Current income tax assets and liabilities are
measured at the amount expected to be recovered
from or paid to the taxation authorities. The tax rates
and tax laws used to compute the amount are those
that are enacted or substantively enacted, at the
reporting date in the countries where the Company
operates and generates taxable income. Current
income tax relating to items recognised outside
profit or loss is recognised outside profit or loss
(either in other comprehensive income or in equity).
Current tax items are recognised in correlation to
the underlying transaction either in OCI or directly in
equity. The Company''s current tax is calculated using
tax rates that have been enacted or substantively
enacted by the end of the reporting period.

Deferred tax

Deferred tax is provided using the liability method
on temporary differences between the tax bases of
assets and liabilities and their carrying amounts for
financial reporting purposes at the reporting date.

Deferred tax liabilities are recognised for all taxable
temporary differences, except:

• When the deferred tax liability arises from the
initial recognition of goodwill or an asset or
liability in a transaction that is not a business

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

• In respect of taxable temporary differences
associated with investments in subsidiaries,
associates and interests in joint ventures, when
the timing of the reversal of the temporary
differences can be controlled and it is probable
that the temporary differences will not reverse
in the foreseeable future.

• Deferred tax assets are recognised for all
deductible temporary differences, the carry
forward of unused tax credits and any unused
tax losses. Deferred tax assets are recognised to
the extent that it is probable that taxable profit
will be available against which the deductible
temporary differences, and the carry forward of
unused tax credits and unused tax losses can
be utilised, except:

When the deferred tax asset relating to the
deductible temporary difference arises from
the initial recognition of an asset or liability in a
transaction that is not a business combination
and, at the time of the transaction, affects
neither the accounting profit nor taxable profit
or loss.

• I n respect of deductible temporary differences
associated with investments in subsidiaries,
associates and interests in joint ventures,
deferred tax assets are recognised only to the
extent that it is probable that the temporary
differences will reverse in the foreseeable future
and taxable profit will be available against which
the temporary differences can be utilized

The carrying amount of deferred tax assets is
reviewed at each reporting date and reduced to the
extent that it is no longer probable that sufficient
taxable profit will be available to allow all or part of
the deferred tax asset to be utilised. Unrecognised
deferred tax assets are re-assessed at each
reporting date and are recognised to the extent that
it has become probable that future taxable profits
will allow the deferred tax asset to be recovered.

In assessing the recoverability of deferred tax
assets, the Company relies on the same forecast

assumptions used elsewhere in the financial
statements and in other management reports, which,
among other things, reflect the potential impact
of climate-related development on the business,
such as increased cost of production as a result of
measures to reduce carbon emission.

Deferred tax assets and liabilities are measured at
the tax rates that are expected to apply in the year
when the asset is realised, or the liability is settled,
based on tax rates (and tax laws) that have been
enacted or substantively enacted at the reporting
date.

Deferred tax relating to items recognised outside
profit or loss is recognised outside profit or loss
(either in other comprehensive income or in equity).
Deferred tax items are recognised in correlation to
the underlying transaction either in OCI or directly in
equity.

Tax benefits acquired as part of a business
combination, but not satisfying the criteria for
separate recognition at that date, are recognised
subsequently if new information about facts and
circumstances change. Acquired deferred tax
benefits recognised within the measurement period
reduce goodwill related to that acquisition if they
result from new information obtained about facts
and circumstances existing at the acquisition date. If
the carrying amount of goodwill is zero, any remaining
deferred tax benefits are recognised in OCI/ capital
reserve depending on the principle explained for
bargain purchase gains. All other acquired tax
benefits realised are recognised in profit or loss.

The Company offsets deferred tax assets and
deferred tax liabilities if and only if it has a legally
enforceable right to set off current tax assets and
current tax liabilities and the deferred tax assets and
deferred tax liabilities relate to income taxes levied
by the same taxation authority on either the same
taxable entity or different taxable entities which
intend either to settle current tax liabilities and
assets on a net basis, or to realise the assets and
settle the liabilities simultaneously, in each future
period in which significant amounts of deferred tax
liabilities or assets are expected to be settled or
recovered.

1.21 Leases

Company as a lessee:

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 applies
a single recognition and measurement approach for
all leases, except for short-term leases and leases
of low-value assets. The Company recognises lease
liabilities to make lease payments and right-of-use
assets representing the right to use the underlying
assets.

Right of use assets

The Company recognises right-of-use assets at the
commencement date of the lease (i.e., the date the
underlying asset is available for use). Right-of-use
assets are measured at cost, less any accumulated
depreciation and impairment losses, and adjusted
for any remeasurement of lease liabilities. The
cost of right-of-use assets includes the amount
of lease liabilities recognised, initial direct costs
incurred, and lease payments made at or before
the commencement date less any lease incentives
received. Right-of-use assets are depreciated on a
straight-line basis over the shorter of the lease term
and the estimated useful lives of the assets.

Lease Liabilities

At the commencement date of the lease, the
Company recognises lease liabilities measured at
the present value of lease payments to be made over
the lease term. The lease payments include fixed
payments (including in substance fixed payments)
less any lease incentives receivable, variable lease
payments that depend on an index or a rate, and
amounts expected to be paid under residual value
guarantees. In calculating the present value of
lease payments, the Company uses its incremental
borrowing rate at the lease commencement date
because the interest rate implicit in the lease is not
readily determinable. After the commencement
date, the amount of lease liabilities is increased to
reflect the accretion of interest and reduced for
the lease payments made. In addition, the carrying
amount of lease liabilities is remeasured if there is a
modification, a change in the lease term, a change in
the lease payments (e.g., changes to future payments

resulting from a change in an index or rate used to
determine such lease payments) or a change in the
assessment of an option to purchase the underlying
asset.

Variable lease payments that do not depend on an
index or a rate are recognised as expenses (unless
they are incurred to produce inventories) in the
period in which the event or condition that triggers
the payment occurs.

Short term lease and leases of low-value
assets

The Company applies the short-term lease
recognition exemption to its short-term leases of
machinery and equipment (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). It also applies the lease of low-value assets
recognition exemption to leases of office equipment
that are considered to be low value. Lease payments
on short-term leases and leases of low-value assets
are recognised as expense on a straight-line basis
over the lease term

Company as a lessor

Leases in which the Company does not transfer
substantially all the risks and rewards incidental
to ownership of an asset is classified as operating
leases. Rental income arising is accounted for on
a straight-line basis over the lease terms. Initial
direct costs incurred in negotiating and arranging an
operating lease are added to the carrying amount
of the leased asset and recognised over the lease
term on the same basis as rental income. Contingent
rents are recognised as revenue in the period in
which they are earned.

Leases are classified as finance leases when
substantially all of the risks and rewards of ownership
transfer from the Company to the lessee. Amounts
due from lessees under finance leases are recorded
as receivables at the Company''s net investment
in the leases. Finance lease income is allocated
to accounting periods so as to reflect a constant
periodic rate of return on the net investment
outstanding in respect of the lease.

1.22 Earnings per share

The Company reports basic and diluted earnings
per share in accordance with Indian Accounting
Standard 33 - Earnings Per Share. Basic earnings
per share is computed by dividing the net profit
or loss attributable to the equity holders of parent
company (after deducting preference dividends and
attributable taxes) by the weighted average number
of equity shares outstanding during the year.

For the purpose of EPS, the potential ordinary shares
that would be issued on conversion are included in
the weighted average number of ordinary shares
used in the calculation of basic EPS (and, therefore,
also diluted EPS) from the date of issue of the
instrument, since their issue is solely dependent on
the passage of time.

Diluted earnings per share reflect the potential
dilution that could occur if securities or other
contracts to issue equity shares were exercised
or converted during the year. Diluted earnings per
share is computed by dividing the net profit after tax
attributable to the equity shareholders for the year
by the weighted average number of equity shares
considered for deriving basic earnings per share
and weighted average number of equity shares
that could have been issued upon conversion of all
potential equity shares.

---

Mar 31, 2024

1.1 Company background

Nuvama Wealth Management Limited (Formerly known as Edelweiss Securities Limited) (''the Company'') is a public limited company domiciled and incorporated under the provisions of the Companies Act applicable in India having Corporate Identity Number: L67110MH1993PLC344634. The Company was incorporated on August 20, 1993. PAGAC Ecstasy Pte. Limited is the holding company. On August 18, 2022, the Company changed its name from Edelweiss Securities Limited to Nuvama Wealth Management Limited (''NWML''). The equity shares of the Company are listed on National Stock Exchange of India Limited and the BSE Limited effective September 26, 2023.

The Company is a stock broking entity and is licensed with and regulated by the Securities and Exchange Board of India (''SEBI'') to, among other things, conduct trading and broking activities for institutional as well as retail clients. The Company is licensed with SEBI as Research Analyst to, among other things, distribute research reports on Indian Securities to its clients. Also, the Company is registered as a Merchant Banker and Investment Adviser with SEBI. The Company is registered as a Trading cum Clearing Member with the National Stock Exchange of India Limited and the BSE Limited and is registered as a Trading Member with Metropolitan Stock Exchange of India Ltd, Multi Commodity Exchange of India Limited and National Commodity Exchange of India Limited.

Summary of Material accounting policy information

1.2 Basis of preparation of standalone financial statements

The standalone financial statements have been prepared in accordance with Indian Accounting Standards (Ind AS) notified under the Companies (Indian Accounting Standards) Rules, 2015 (as amended from time to time). These standalone financial statements have been approved for issue by the Board of Directors of the Company on May 10, 2024.

These standalone financial statements have been prepared on a historical cost basis, except for certain financial instruments such as derivative financial instruments and other financial assets held for trading, which have been measured at fair value.

The standalone financial statements are presented in Indian Rupees (INR) and all values are rounded off to the nearest million, except when otherwise indicated.

1.3 Presentation of standalone financial statements

The Company presents its standalone balance sheet in order of liquidity in compliance with the Division III of the Schedule III to the Companies Act, 2013. An analysis regarding recovery or settlement within 12 months after the reporting date (current) and more than 12 months after the reporting date (non-current) is presented in note 2.35.

Financial assets and financial liabilities are generally reported gross in the standalone balance sheet. They are only offset and reported net when, in addition to having an unconditional legally enforceable right to offset the recognised amounts without being contingent on a future event, the parties also intend to settle on a net basis in all of the following circumstances:

1. The normal course of business

2. The event of default

3. The event of insolvency or bankruptcy of the Company and/or its counterparties

1.4 Revenue from contract with customer

Revenue is measured at transaction price i.e. the amount of consideration to which the Company expects to be entitled in exchange for transferring promised goods or services to the customer, excluding amounts collected on behalf of third parties. The Company consider the terms of the contracts and its customary business practices to determine the transaction price. Where the consideration promised is variable, the Company excludes the estimates of variable consideration that are constrained. The Company applies the five-step approach for recognition of revenue:

i) Identification of contract(s) with customers;

ii) Identification of the separate performance obligations in the contract;

iii) Determination of transaction price;

iv) Allocation of transaction price to the separate performance obligations; and

v) Recognition of revenue when (or as) each performance obligation is satisfied

The Company recognises revenue from the following sources:

• Brokerage income is recognised as per contracted rates at the point in time when transaction''s performance obligation is satisfied on behalf of the customers on the trade date.

• Fee income including merchant banking and advisory fees is accounted on an accrual basis as per Ind AS 115 in accordance with the terms and contracts entered into between the Company and the counterparty and presented service transferred at point in time and over time.

• Research services fee income is accounted when there is reasonable certainty as to its receipts.

• Interest income is recognized on accrual basis.

Dividend income:

Dividend income is recognised when the right to receive payment is established, it is probable that the economic benefits associated with the dividend will flow to the entity and the amount of the dividend can be measured reliably.

1.5 Financial Instruments

Date of recognition

Financial assets and financial liabilities with exception of borrowings are initially recognised on the trade date, i.e., the date that the Company becomes a party to the contractual provisions of the instrument. This includes regular way trades; purchases or sales of financial assets that require delivery of assets within the time frame generally established by regulation or convention in the market place. The Company recognises borrowings when funds are received by the Company.

Initial measurement of financial instruments

Financial assets are classified, at initial recognition, as subsequently measured at amortised cost, fair value through other comprehensive income (OCI), and fair value through profit or loss.

The classification of financial assets at initial recognition depends on the financial asset''s contractual cash flow characteristics and the Company''s business model for managing them. With the exception of trade receivables that do not contain a significant financing component or for which the Company has applied the practical expedient, the Company initially measures a financial asset at its fair value plus, in the case of a financial asset not at fair value through profit or loss, transaction costs. Trade receivables that do not contain a significant financing component or for which the Company has applied the practical expedient are measured at the transaction price determined under Ind AS 115. Refer to the accounting policies note no 1.4.

Day 1 profit or loss

When the transaction price of the financial instrument differs from the fair value at origination and the fair value is based on a valuation technique using only inputs observable in market transactions, the Company recognises the difference between the transaction price and fair value in net gain on fair value changes. In those cases where fair value is based on models for which some of the inputs are not observable, the difference between the transaction price and the fair value is deferred and is only recognised in statement of profit and loss when the inputs become observable, or when the instrument is derecognised.

Classification of financial instruments

The Company classifies all of its financial assets based on the business model for managing the assets and the asset''s contractual terms, measured at either:

Financial assets carried at amortised cost (AC)

A financial asset is measured at amortised cost if it is held within a business model whose objective is to hold the asset in order to collect contractual cash flows and 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. The changes in carrying value of financial assets is recognised in profit and loss account.

Financial assets at fair value through other comprehensive income (FVTOCI)

A financial asset is measured at FVTOCI if it is held within a business model whose objective is achieved by both collecting contractual cash flows and selling financial assets and 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. The changes in fair value of financial assets is recognised in Other Comprehensive Income.

Financial assets at fair value through profit or loss (FVTPL)

A financial asset which is not classified in any of the above categories are measured at FVTPL. The Company measures all financial assets classified as FVTPL at fair value at each reporting date. The changes in fair value of financial assets is recognised in Profit and loss account.

The Company measures financial assets that meet the following conditions at amortised cost:

• the financial asset is held within a business model whose objective is to hold financial assets in order to collect contractual cash flows; and

• 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.

Debt instruments that meet the following conditions are subsequently measured at fair value through other comprehensive income (except for debt instruments that are designated as at fair value through profit or loss on initial recognition):

• the financial asset is held within a business model whose objective is achieved both by collecting contractual cash flows and selling the financial assets; and

• 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

Amortized cost and effective interest rate (EIR)

The effective interest rate is a method of calculating the amortised cost of a debt instrument and of allocating interest income over the relevant period.

For financial instruments other than purchased or originated credit-impaired financial assets, the effective interest rate is the rate that exactly discounts estimated future cash receipts (including all fees and points paid or received that form an integral part of the effective interest rate, transaction costs and other premiums or discounts) excluding expected credit losses, through the expected life of the debt instrument, or, where appropriate, a shorter period, to the gross carrying amount of the debt instrument on initial recognition. For purchased or originated credit impaired financial assets, a credit-adjusted effective interest rate is calculated by discounting the estimated future cash flows, including expected credit losses, to the amortised cost of the debt instrument on initial recognition.

The amortised cost of a financial asset is the amount at which the financial asset is measured at initial recognition minus the principal repayments, plus the cumulative amortisation using the effective interest method of any difference between that initial amount and the maturity amount, adjusted for any loss allowance. On the other hand, the gross carrying amount of a financial asset is the amortised cost of a financial asset before adjusting for any loss allowance.

Financial assets held for trading

The Company classifies financial assets as held for trading when they have been purchased or issued primarily for short-term profit making through trading activities or form part of a portfolio of financial instruments that are managed together, for which there evidence of a recent pattern of shortterm profit is taking. Held-for-trading assets and liabilities are recorded and measured in the balance sheet at fair value.

Financial assets at fair value through profit or loss

Financial assets and financial liabilities in this category are those that are not held for trading and have been either designated by management upon initial recognition or are mandatorily required

to be measured at fair value under Ind AS 109. Management only designates an instrument at FVTPL upon initial recognition when one of the following criteria are met. Such designation is determined on an instrument-by-instrument basis.

• The designation eliminates, or significantly reduces, the inconsistent treatment that would otherwise arise from measuring the assets or liabilities or recognizing gains or losses on them on a different basis; Or

• The liabilities are part of a group of financial liabilities, which are managed and their performance evaluated on a fair value basis, in accordance with a documented risk management or investment strategy; Or

• The liabilities containing one or more embedded derivatives, unless they do not significantly modify the cash flows that would otherwise be required by the contract, or it is clear with little or no analysis when a similar instrument is first considered that separation of the embedded derivative(s) is prohibited.

Financial assets and financial liabilities at FVTPL are recorded in the standalone balance sheet at fair value. Changes in fair value are recorded in profit and loss with the exception of movements in fair value of liabilities designated at FVTPL due to changes in the Company''s own credit risk. Such changes in fair value are recorded in the own credit reserve through OCI and do not get recycled to the profit or loss. Interest earned or incurred on instruments designated at FVTPL is accrued in interest income or finance cost, respectively, using the EIR, taking into account any discount/ premium and qualifying transaction costs being an integral part of instrument. Interest earned on assets mandatorily required to be measured at FVTPL is recorded using contractual interest rate.

Investment in equity instruments

The Company subsequently measures all equity investments at fair value through profit or loss, unless the management has elected to classify irrevocably some of its strategic equity investments to be measured at FVOCI, when such instruments meet the definition of Equity under Ind AS and are not held for trading. Such classification is determined on an instrument-by-instrument basis. Investments in subsidiaries and associate companies are carried at cost.

All financial liabilities are measured at amortised cost except loan commitments, financial guarantees, and derivative financial liabilities.

Debt securities and other borrowed funds

After initial measurement, debt issued and other borrowed funds are subsequently measured at amortised cost. Amortised cost is calculated by taking into account any discount or premium on issue funds, and costs that are an integral part of the EIR.

Financial guarantee

Financial guarantees are contracts that require the Company to make specified payments to reimburse to holder for loss that it incurs because a specified debtor fails to make payment when it is due in accordance with the terms of a debt instrument.

Financial guarantee issued or commitments to provide a loan at below market interest rates are initially measured at fair value and the initial fair value is amortised over the life of the guarantee or the commitment. Subsequently, they are measured at higher of the amount of loss allowance determined as per impairment requirements of Ind AS 109 and the amount recognised less cumulative amortisation.

Financial liabilities and equity instruments

Financial instruments issued by the Company are classified as either financial liabilities or as equity in accordance with the substance of the contractual arrangements and the definitions of a financial liability and an equity instrument.

An equity instrument is any contract that evidences a residual interest in the assets of an entity after deducting all of its liabilities. Equity instruments issued by the Company are recognised at the proceeds received, net of direct issue costs.

Repurchase of the Company''s own equity instruments is recognised and deducted directly in equity. No gain or loss is recognised in profit or loss on the purchase, sale, issue or cancellation of the Company''s own equity instruments.

1.7 Reclassification of financial assets and liabilities

The Company does not reclassify its financial assets subsequent to their initial recognition, apart

from the exceptional circumstances in which the Company acquires, disposes of, or terminates a business line.

1.8 Derecognition of financial instruments

Derecognition of financial asset

A financial asset (or, where applicable a part of a financial asset or a part of a group of similar financial assets) is derecognised when the rights to receive cash flows from the financial asset have expired. The Company also derecognises the financial asset if it has both transferred the financial asset and the transfer qualifies for derecognition.

The Company has transferred the financial asset if, and only if, either

• The Company has transferred the rights to receive cash flows from the financial asset or

• It retains the contractual rights to receive the cash flows of the financial asset, but assumed a contractual obligation to pay the cash flows in full without material delay to third party under pass through arrangement.

Pass-through arrangements are transactions whereby the Company retains the contractual rights to receive the cash flows of a financial asset (the ''original asset''), but assumes a contractual obligation to pay those cash flows to one or more entities (the ''eventual recipients''), when all of the following conditions are met:

• The Company has no obligation to pay amounts to the eventual recipients unless it has collected equivalent amounts from the original asset, excluding short-term advances with the right to full recovery of the amount lent plus accrued interest at market rates.

• The Company cannot sell or pledge the original asset other than as security to the eventual recipients.

• The Company has to remit any cash flows it collects on behalf of the eventual recipients without material delay. In addition, the Company is not entitled to reinvest such cash flows, except for investments in cash or cash equivalents including interest earned, during the period between the collection date and the date of required remittance to the eventual recipients.

A transfer only qualifies for derecognition if either:

• The Company has transferred substantially all the risks and rewards of the asset; or

• The Company has neither transferred nor retained substantially all the risks and rewards of the asset, but has transferred control of the asset.

The Company considers control to be transferred if and only if, the transferee has the practical ability to sell the asset in its entirety to an unrelated third party and is able to exercise that ability unilaterally and without imposing additional restrictions on the transfer.

Derecognition of financial liabilities

A financial liability is derecognised when the obligation under the liability is discharged, cancelled or expires. Where an existing financial liability is replaced by another from the same lender on substantially different terms, or the terms of an existing liability are substantially modified, such an exchange or modification is treated as a derecognition of the original liability and the recognition of a new liability. The difference between the carrying value of the original financial liability and the consideration paid is recognised in the statement of profit or loss.

1.9 Impairment of financial assets

The Company records allowance for expected credit loss (ECL) for all financial assets, other than financial assets held at FVTPL together with financial guarantee contracts.

Simplified approach

The Company follows ''simplified approach'' for recognition of impairment loss allowance on trade receivables. The application of simplified approach does not require the Company to track changes in credit risk. Rather, it recognises impairment loss allowance based on lifetime ECLs at each reporting date, right from its initial recognition. The Company uses a provision matrix to determine impairment loss allowance on portfolio of its receivables. The provision matrix is based on its historically observed default rates over the expected life of the receivables and is adjusted for forwardlooking estimates. However, if receivables contain a significant financing component, the Company

chooses as its accounting policy to measure the loss allowance by applying general approach to measure ECL.

1.10 Determination of fair value

The Company measures financial instruments, such as, derivatives at fair value at each balance sheet date. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair value measurement is based on the presumption that the transaction to sell the asset or transfer the liability takes place either:

• In the principal market for 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 by the Company.

The fair value of an asset or a liability is measured using the assumptions that market participants would use when pricing the asset or liability, assuming that market participants act in their economic best interest. A fair value measurement of a non-financial asset takes into account a market participant''s ability to generate economic benefits by using the asset in its highest and best use or by selling it to another market participant that would use the asset in its highest and best use. The Company uses valuation techniques that are appropriate in the circumstances and for which sufficient data are available to measure fair value, maximising the use of relevant observable inputs and minimising the use of unobservable inputs. In order to show how fair values have been derived, financial instruments are classified based on a hierarchy of valuation techniques, as summarised below:

Level 1 financial instruments:

Those where the inputs used in the valuation are unadjusted quoted prices from active markets for identical assets or liabilities that the Company has access to at the measurement date. The Company considers markets as active only if there are sufficient trading activities with regards to the volume and liquidity of the identical assets or liabilities and when there are binding and exercisable price quotes available on the balance sheet date.

Level 2 financial instruments

Those where the inputs that are used for valuation and are significant, are derived from directly or indirectly observable market data available over the entire period of the instrument''s life.

Level 3 financial instruments

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

For assets and liabilities that are recognised in the financial statements on a recurring basis, the Company determines whether transfers have occurred between levels in the hierarchy by reassessing categorization (based on the lowest level input that is significant to the fair value measurement as a whole) at the end of each reporting period. The Company periodically reviews its valuation techniques including the adopted methodologies and model calibrations.

Therefore, the Company applies various techniques to estimate the credit risk associated with its financial instruments measured at fair value, which include a portfolio-based approach that estimates for the expected net exposure per counterparty over the full lifetime of the individual assets, in order to reflect the credit risk of the individual counterparties for non-collateralised financial instruments.

The Company evaluates the levelling at each reporting period on an instrument-by-instrument basis and reclassifies instruments when necessary based on the facts at the end of the reporting period.

1.11 Write-offs

Financial assets are written off either partially or in their entirety only when the Company has no reasonable expectation of recovery.

1.12 Property, plant and equipment, Right-of-use assets and Capital work in progress

Property, plant and equipment is stated at cost excluding the costs of day-to-day servicing, less accumulated depreciation and accumulated impairment in value. Changes in the expected useful life are accounted for by changing the amortization

period or methodology, as appropriate, and treated as changes in accounting estimates.

Depreciation is recognized so as to write off the cost of assets less their residual values over their useful lives. Depreciation is provided on a written down value basis from the date the asset is ready for its intended use. In respect of assets sold, depreciation is provided upto the date of disposal.

An item of property, plant and equipment is derecognised upon disposal or when no future economic benefits are expected to arise from the continued use of the asset. The carrying amount of those components which have been separately recognised as assets is derecognised at the time of replacement thereof. Any gain or loss arising on the disposal or retirement of an item of property, plant and equipment is determined as the difference between the sales proceeds and the carrying amount of the asset and is recognised in profit or loss.

As per the requirement of Schedule II of the Companies Act, 2013, the Company has evaluated the estimated useful lives of the respective fixed assets which are as per the provisions of Part C of Schedule II of the Act for calculating the depreciation.

The estimated useful lives of the property, plant and equipment are as follows:

Class of asset	Useful life
Building (other than factory building)	60 years
Furniture and fixtures	10 years
Vehicles	8 years
Office equipment	5 years
Computers and data processing units (including Direct Market Access assets) - End user devices, such as desktops, laptops etc.	0 to 3 years
Computers and data processing units - Servers and networks	6 years

For transition to Ind AS, the Company has elected to continue with the carrying value of all of its property, plant and equipment and intangible asset recognised as of 1 April 2017 (transition date) measured as per the previous GAAP and use that carrying value as its deemed cost as of the transition date.

Measurement of land and building under revaluation model:

Increases in the carrying amount arising on revaluation of land and buildings are credited to other comprehensive income and shown as a revaluation reserve in shareholders'' equity. An exception is a gain on revaluation that reverses a revaluation decrease (impairment) on the same asset previously recognised as an expense. Decreases that offset previous increases of the same asset are charged in other comprehensive income and debited against the revaluation reserve directly in equity; all other decreases are charged to profit or loss. An annual transfer from the revaluation surplus to retained earnings is made for the difference between depreciation based on the revalued carrying amount of the asset and depreciation based on the asset''s original cost. Each year the difference between depreciation based on the revalued carrying amount of the asset charged to profit or loss and depreciation based on the asset''s original cost is transferred from the revaluation reserve to retained earnings.

Right-of-use assets are presented together with property, plant and equipment in the statement of financial position - refer to the accounting policy. Right-of-use assets are depreciated on a straightline basis over the lease term.

The residual values, useful lives and methods of depreciation of property, plant and equipment are reviewed at each financial year end and adjusted prospectively, if appropriate.

Leasehold improvements are amortized on a straight-line basis over the estimated useful lives of the assets or the period of lease whichever is shorter.

1.13 Intangible assets

The Company''s intangible assets mainly include the value of software. An intangible asset is recognised only when its cost can be measured reliably and it is probable that the expected future economic benefits that are attributable to it will flow to the Company.

Intangible assets acquired separately are measured on initial recognition at cost. The cost of intangible assets acquired in a business combination is their fair value as at the date of acquisition. Following

initial recognition, intangible assets are carried at cost less any accumulated amortisation and any accumulated impairment losses. Intangible assets with finite lives are amortized over the useful economic life and assessed for impairment whenever there is an indication that the intangible asset may be impaired.

An intangible asset is derecognised upon disposal (i.e., at the date the recipient obtains control) or when no future economic benefits are expected from its use or disposal. Any gain or loss arising upon derecognition of the asset (calculated as the difference between the net disposal proceeds and the carrying amount of the asset) is included in the statement of profit or loss.

The estimated useful lives of the intangible assets are as follows:

Class of asset	Useful life
Software	3 - 5 years

1.14 Impairment of non-financial assets

The Company assesses at each balance sheet date whether there is any indication that an asset may be impaired. If any indication exists, or when annual impairment testing for an asset is required, the Company estimates the asset''s recoverable amount. An asset''s recoverable amount is the higher of an asset''s or cash-generating unit''s (CGU) fair value less costs of disposal and its value in use. The recoverable amount is determined for an individual asset, unless the asset does not generate cash inflows that are largely independent of those from other assets or groups of assets. When the carrying amount of an asset or CGU exceeds its recoverable amount, the asset is considered impaired and is written down to its recoverable amount.

1.15 Securities held for trading

a) The securities acquired with the intention of short term holding and trading positions are considered as securities held for trading.

b) The securities, including from error trades, held as securities held for trading are valued at market value.

1.16 Cash and cash equivalents

Cash at Banks and on hand and short-term deposits with original maturities of three months or less, that

are readily convertible to a known amount of cash and subject to an insignificant risk of changes in value.

1.17 Foreign currency transactions

The standalone financial statements are presented in Indian Rupees which is also functional currency of the Company. Transactions in currencies other than Indian Rupees (i.e. foreign currencies) are recognised at the rates of exchange prevailing at the dates of the transactions. At the end of each reporting period, monetary items denominated in foreign currencies are retranslated at the rates prevailing at that date. Non-monetary items carried at fair value that are denominated in foreign currencies are retranslated at the rates prevailing at the date when the fair value was determined. Non-monetary items that are measured in terms of historical cost in a foreign currency are not retranslated.

Exchange differences on monetary items are recognised in profit or loss in the period in which they arise. The gain or loss arising on translation of non-monetary items measured at fair value is treated in line with the recognition of the gain or loss on the change in fair value of the item (i.e., translation differences on items whose fair value gain or loss is recognised in OCI or profit or loss are also recognised in OCI or profit or loss, respectively)

1.18 Retirement and other employee benefits

Provident fund and national pension scheme

The Company contributes to a recognized provident fund and national pension scheme which is a defined contribution scheme. The contributions are accounted for on an accrual basis and recognized in the standalone statement of profit and loss.

Gratuity

The Company''s gratuity scheme is a defined benefit plan. The Company''s net obligation in respect of the gratuity benefit scheme is calculated by estimating the amount of future benefit that the employees have earned in return for their service in the current and prior periods. Such benefit is discounted to determine its present value, and the fair value of any plan assets, if any, is deducted.

The present value of the obligation under such benefit plan is determined based on independent

actuarial valuation using the Projected Unit Credit Method. Benefits in respect of gratuity are funded with an Insurance Company approved by Insurance Regulatory and Development Authority (IRDA).

Re-measurement, comprising of actuarial gains and losses, the effect of the asset ceiling, excluding amounts included in net interest on the net defined benefit liability, are recognised immediately in the balance sheet with a corresponding debit or credit to retained earnings through OCI in the period in which they occur.

Remeasurement are not reclassified to profit or loss in subsequent periods.

Compensated Leave Absences

The eligible employees of the Company are permitted to carry forward certain number of their annual leave entitlement to subsequent years, subject to a ceiling. The Company recognises the charge to the standalone statement of profit and loss and corresponding liability on account of such accumulated leave entitlement based on a valuation by an independent actuary. The cost of providing annual leave benefits are determined using the projected unit credit method.

Share-based payment arrangements

Equity-settled share-based payments to employees by the Company and by the erstwhile ultimate parent Group are measured by reference to the fair value of the equity instruments at the grant date.

The fair value of Equity-settled share-based payments determined at the grant date is expensed over the vesting period, based on the Company''s estimate of equity instruments that will eventually vest, with a corresponding increase in equity. In cases where the share options granted vest in instalments over the vesting period, the Company treats each instalment as a separate grant, because each instalment has a different vesting period, and hence the fair value of each instalment differs.

1.19 Income tax expenses

Income tax expense represents the sum of the tax currently payable and deferred tax.

Current tax

The tax currently payable is based on taxable profit for the year. Current income tax assets and

liabilities are measured at the amount expected to be recovered from or paid to the taxation authorities. The tax rates and tax laws used to compute the amount are those that are enacted or substantively enacted, at the reporting date in the countries where the Company operates and generates taxable income. Current income tax relating to items recognised outside profit or loss is recognised outside profit or loss (either in other comprehensive income or in equity). Current tax items are recognised in correlation to the underlying transaction either in OCI or directly in equity. The Company''s current tax is calculated using tax rates that have been enacted or substantively enacted by the end of the reporting period.

Deferred tax

Deferred tax is provided using the liability method on temporary differences between the tax bases of assets and liabilities and their carrying amounts for financial reporting purposes at the reporting date.

Deferred tax liabilities are recognised for all taxable temporary differences, except:

• When the deferred tax liability arises from the initial recognition of goodwill or an asset or liability in a transaction that is not a business combination and, at the time of the transaction, affects neither the accounting profit nor taxable profit or loss

• In respect of taxable temporary differences associated with investments in subsidiaries, associates and interests in joint ventures, when the timing of the reversal of the temporary differences can be controlled and it is probable that the temporary differences will not reverse in the foreseeable future.

• Deferred tax assets are recognised for all deductible temporary differences, the carry forward of unused tax credits and any unused tax losses. Deferred tax assets are recognised to the extent that it is probable that taxable profit will be available against which the deductible temporary differences, and the carry forward of unused tax credits and unused tax losses can be utilised, except:

When the deferred tax asset relating to the deductible temporary difference arises from the initial recognition of an asset or liability in a

transaction that is not a business combination and, at the time of the transaction, affects neither the accounting profit nor taxable profit or loss.

• In respect of deductible temporary differences associated with investments in subsidiaries, associates and interests in joint ventures, deferred tax assets are recognised only to the extent that it is probable that the temporary differences will reverse in the foreseeable future and taxable profit will be available against which the temporary differences can be utilized

The carrying amount of deferred tax assets is reviewed at each reporting date and reduced to the extent that it is no longer probable that sufficient taxable profit will be available to allow all or part of the deferred tax asset to be utilised. Unrecognised deferred tax assets are re-assessed at each reporting date and are recognised to the extent that it has become probable that future taxable profits will allow the deferred tax asset to be recovered.

In assessing the recoverability of deferred tax assets, the Company relies on the same forecast assumptions used elsewhere in the financial statements and in other management reports, which, among other things, reflect the potential impact of climate-related development on the business, such as increased cost of production as a result of measures to reduce carbon emission.

Deferred tax assets and liabilities are measured at the tax rates that are expected to apply in the year when the asset is realised, or the liability is settled, based on tax rates (and tax laws) that have been enacted or substantively enacted at the reporting date.

Deferred tax relating to items recognised outside profit or loss is recognised outside profit or loss (either in other comprehensive income or in equity). Deferred tax items are recognised in correlation to the underlying transaction either in OCI or directly in equity.

Tax benefits acquired as part of a business combination, but not satisfying the criteria for separate recognition at that date, are recognised subsequently if new information about facts and circumstances change. Acquired deferred tax

benefits recognised within the measurement period reduce goodwill related to that acquisition if they result from new information obtained about facts and circumstances existing at the acquisition date. If the carrying amount of goodwill is zero, any remaining deferred tax benefits are recognised in OCI/ capital reserve depending on the principle explained for bargain purchase gains. All other acquired tax benefits realised are recognised in profit or loss.

The Company offsets deferred tax assets and deferred tax liabilities if and only if it has a legally enforceable right to set off current tax assets and current tax liabilities and the deferred tax assets and deferred tax liabilities relate to income taxes levied by the same taxation authority on either the same taxable entity or different taxable entities which intend either to settle current tax liabilities and assets on a net basis, or to realise the assets and settle the liabilities simultaneously, in each future period in which significant amounts of deferred tax liabilities or assets are expected to be settled or recovered.

1.20 Leases

Company as a lessee:

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 applies a single recognition and measurement approach for all leases, except for short-term leases and leases of low-value assets. The Company recognises lease liabilities to make lease payments and right-of-use assets representing the right to use the underlying assets.

Right of use assets

The Company recognises right-of-use assets at the commencement date of the lease (i.e., the date the underlying asset is available for use). Right-of-use assets are measured at cost, less any accumulated depreciation and impairment losses, and adjusted for any remeasurement of lease liabilities. The cost of right-of-use assets includes the amount of lease liabilities recognised, initial direct costs incurred, and lease payments made at or before the commencement date less any lease incentives received. Right-of-use assets are depreciated on a straight-line basis over the shorter of the lease term and the estimated useful lives of the assets.

Lease Liabilities

At the commencement date of the lease, the Company recognises lease liabilities measured at the present value of lease payments to be made over the lease term. The lease payments include fixed payments (including in substance fixed payments) less any lease incentives receivable, variable lease payments that depend on an index or a rate, and amounts expected to be paid under residual value guarantees. In calculating the present value of lease payments, the Company uses its incremental borrowing rate at the lease commencement date because the interest rate implicit in the lease is not readily determinable. After the commencement date, the amount of lease liabilities is increased to reflect the accretion of interest and reduced for the lease payments made. In addition, the carrying amount of lease liabilities is remeasured if there is a modification, a change in the lease term, a change in the lease payments (e.g., changes to future payments resulting from a change in an index or rate used to determine such lease payments) or a change in the assessment of an option to purchase the underlying asset.

Variable lease payments that do not depend on an index or a rate are recognised as expenses (unless they are incurred to produce inventories) in the period in which the event or condition that triggers the payment occurs.

Short term lease and leases of low-value assets

The Company applies the short-term lease recognition exemption to its short-term leases of machinery and equipment (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). It also applies the lease of low-value assets recognition exemption to leases of office equipment that are considered to be low value. Lease payments on short-term leases and leases of low-value assets are recognised as expense on a straight-line basis over the lease term

Company as a lessor

Leases in which the Company does not transfer substantially all the risks and rewards incidental to ownership of an asset is classified as operating leases. Rental income arising is accounted for on a straight-line basis over the lease terms. Initial direct costs incurred in negotiating and arranging an

operating lease are added to the carrying amount of the leased asset and recognised over the lease term on the same basis as rental income. Contingent rents are recognised as revenue in the period in which they are earned.

Leases are classified as finance leases when substantially all of the risks and rewards of ownership transfer from the Company to the lessee. Amounts due from lessees under finance leases are recorded as receivables at the Company''s net investment in the leases. Finance lease income is allocated to accounting periods so as to reflect a constant periodic rate of return on the net investment outstanding in respect of the lease.

1.21 Earnings per share

The Company reports basic and diluted earnings per share in accordance with Indian Accounting Standard 33 - Earnings Per Share. Basic earnings per share is computed by dividing the net profit or loss attributable to the equity holders of parent company (after deducting preference dividends and attributable taxes) by the weighted average number of equity shares outstanding during the year.

For the purpose of EPS, the potential ordinary shares that would be issued on conversion are included in the weighted average number of ordinary shares used in the calculation of basic EPS (and, therefore, also diluted EPS) from the date of issue of the instrument, since their issue is solely dependent on the passage of time.

Diluted earnings per share reflect the potential dilution that could occur if securities or other contracts to issue equity shares were exercised or converted during the year. Diluted earnings per share is computed by dividing the net profit after tax attributable to the equity shareholders for the year by the weighted average number of equity shares considered for deriving basic earnings per share and weighted average number of equity shares that could have been issued upon conversion of all potential equity shares.

1.22 Provisions and other contingent liabilities

Provisions are recognised when the Company has a present obligation (legal or constructive) as a result of a past event, it is probable that the Company

will be 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 end of the reporting period, taking into account the risks and uncertainties surrounding the obligation.

A contingent liability is:

(a) a possible obligation that arises from past events and whose existence will be confirmed only by the occurrence or non-occurrence of one or more uncertain future events not wholly within the control of the entity; or

(b) a present obligation that arises from past events but is not recognised because:

(i) it is not probable that an outflow of resources embodying economic benefits will be required to settle the obligation; or

(ii) the amount of the obligation cannot be measured with sufficient reliability.

Given the subjectivity and uncertainty of determining the probability and amount of losses, the Company takes into account a number of factors including legal advice, the stage of the matter and historical evidence from similar incidents.

Provisions are reviewed at each balance sheet date and adjusted to reflect the current best estimate. If it is no longer probable that the outflow of resources would be required to settle the obligation, the provision is reversed.

Contingent assets are not recognised in the standalone financial statements. However, contingent assets are assessed continually and if it is virtually certain that an economic benefit will arise, the asset and related income are recognised in the period in which the change occurs.

1.23 Business Combination

Business combinations are accounted for using the acquisition method. The cost of an acquisition is measured as the aggregate of the consideration transferred measured at acquisition date fair value and the amount of any non-controlling interests in the acquiree. For each business combination,

the Company elects whether to measure the noncontrolling interests in the acquiree at fair value or at the proportionate share of the acquiree''s identifiable net assets. Acquisition-related costs are expensed as incurred.

The Company determines that it has acquired a business when the acquired set of activities and assets include an input and a substantive process that together significantly contribute to the ability to create outputs. The acquired process is considered substantive if it is critical to the ability to continue producing outputs, and the inputs acquired include an organised workforce with the necessary skills, knowledge, or experience to perform that process or it significantly contributes to the ability to continue producing outputs and is considered unique or scarce or cannot be replaced without significant cost, effort, or delay in the ability to continue producing outputs.

At the acquisition date, the identifiable assets acquired, and the liabilities assumed are recognised at their acquisition date fair values. For this purpose, the liabilities assumed include contingent liabilities representing present obligation and they are measured at their acquisition fair values irrespective of the fact that outflow of resources embodying economic benefits is not probable

Business combinations under common control

Common control business combinations includes transactions, such as transfer of subsidiaries or businesses, between entities within a Company. Company has accounted for all such transactions based on pooling of interest method, which is as below:

• The assets and liabilities of the combining entities are reflected at their carrying amounts in the books of transferrer entity.

• No adjustments are made to reflect fair values or recognise any new assets or liabilities.

• The financial information in the financial statements in respect of prior periods are restated as if the business combination had occurred from the beginning of the preceding period in the financial statements, irrespective of the actual date of the combination.

The identity of the reserves shall be preserved and shall appear in the financial statements of the transferee in the same form in which they appeared in the financial statements of the transferor. The difference, if any, between the amounts recorded as share capital issued plus any additional consideration in the form of cash or other assets and the amount of share capital of the transferor shall be transferred to capital reserve.

When the Company acquires a business, it assesses the financial assets and liabilities assumed for appropriate classification and designation in accordance with the contractual terms, economic circumstances and pertinent conditions as at the acquisition date. This includes the separation of embedded derivatives in host contracts by the acquiree.

If the business combination is achieved in stages, any previously held equity interest is re-measured at its acquisition date fair value and any resulting gain or loss is recognised in profit or loss or OCI, as appropriate.

Any contingent consideration to be transferred by the acquirer is recognised at fair value at the acquisition date. Contingent consideration classified as an asset or liability that is a financial instrument and within the scope of Ind AS 109 Financial Instruments, is measured at fair value with changes in fair value recognised in profit or loss in accordance with Ind AS 109. If the contingent consideration is not within the scope of Ind AS 109, it is measured in accordance with the appropriate Ind AS and shall be recognised in profit or loss. Contingent consideration that is classified as equity is not re-measured at subsequent reporting dates and subsequent its settlement is accounted for within equity.

Goodwill is initially measured at cost, being the excess of the aggregate of the consideration transferred and the amount recognised for noncontrolling interests, and any previous interest held, over the net identifiable assets acquired and liabilities assumed. If the fair value of the net assets acquired is in excess of the aggregate consideration transferred, the Company re-assesses whether it has correctly identified all of the assets acquired and all of the liabilities assumed and reviews the procedures used to measure the amounts to be recognised at the acquisition date. If the reassessment still results in an excess of the fair value of net assets acquired over the aggregate consideration transferred, then the gain is recognised in OCI and accumulated in equity as capital reserve. However, if there is no clear evidence of bargain purchase, the entity recognises the gain directly in equity as capital reserve, without routing the same through OCI.

After initial recognition, goodwill is measured at cost less any accumulated impairment losses. For the purpose of impairment testing, goodwill acquired in a business combination is, from the acquisition date, allocated to each of the Company''s cashgenerating units that are expected to benefit from the combination, irrespective of whether other assets or liabilities of the acquiree are assigned to those units.

1.24 Significant accounting judgements, estimates and assumptions

The preparation of the Company''s standalone financial statements requires management to make judgements, estimates and assumptions that affect the reported amount of revenues, expenses, assets and liabilities, and the accompanying disclosures, as well as the disclosure of contingent liabilities. Uncertainty about these assumptions and estimates could result in outcomes that require a material adjustment to the carrying amount of assets or liabilities affected in future periods.

Judgements

In the process of applying the Company''s accounting policies, management has made the following judgements, which have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year.

(a) Actuarial assumptions used in calculation of defined benefit plans

(b) Assumptions used in estimating the useful lives of tangible assets reported under property, plant and equipment.

Provision and contingent liability

On an ongoing basis, the Company reviews pending cases, claims by third parties and other contingencies. For contingent losses that are considered probable, an estimated loss is recorded as an accrual in standalone financial statements.

Loss Contingencies that are considered possible are not provided for but disclosed as Contingent liabilities in the standalone financial statements. Contingencies the likelihood of which is remote are not disclosed in the standalone financial statements. Gain contingencies are not recognized until the contingency has been resolved and amounts are received or receivable.

Revaluation of property, plant and equipment

The Company measures Building classified as property, plant and equipm

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Mar 31, 2023

1.1    Background

Nuvama Wealth and Investment Limited (Formerly known as Edelweiss Broking Limited) ("the Company") was incorporated on February 7, 2008. The Company is a 100% subsidiary of Nuvama Wealth Management Limited (Formerly known as Edelweiss Securities Limited). PAGAC Ecstasy Pte. Limited Is the Ultimate Holding Company of the Company. The registered office is located at 2nd Floor, Office No. 201-203, Zodiac Plaza, Xavier College Road, Off C G Road, Ahmedabad 380009.

The Company is registered as a trading member with National Exchange of India Limited ('NSEIL), BSE Limited ('BSE') and Metropolitan Stock Exchange of India Limited (MSEI), Multi-commodity Exchange of India Limited (MCX), National Commodity and Derivatives Exchange Limited (NCDEX) and provides broking services to the clients. The Company is also registered as Depository Participant with National Securities Depository Limited (NSDL), Central Depository Services (India) Limited (CDSL) and also registered as Repository Participant with National E-Repository Limited (NERL) and CDSL Commodity Repository Limited (CCRL). The Company is registered as Research Analyst with Securities and Exchange Board of India (SEBI) and Corporate agent (Composite) with Insurance Regulatory and Development Authority of India (IRDAI). The Company is registered as Point of Presence (PoP) underthe National Pension System (NPS) with Pension Fund Regulatory and Development Authority and Real Estate Agent with Maharashtra Real Estate Regulatory Authority, Uttar Pradesh Real Estate Regulatory Authority, Haryana Real Estate Regulatory Authority Panchkula. The Company is also a distributor for various financial products such as Mutual Funds, Bonds, NCD, PMS, Structured Products & Alternative Investment fund etc.

1.2    Basis of preparation of financial statements

The financial statements of the Company has been prepared in accordance with Indian Accounting Standards (ind AS) notified under the Companies (Indian Accounting Standards) Rules, 2015 (as amended from time to time).

These financial statements have been prepared on a historical cost basis, except for certain financial instruments such as financial asset measured at fair value through other comprehensive income (FVOCI) instruments, derivative financial instruments, and other financial assets held for trading, which have been measured at fair value through profit or loss (FVTPL). The financial statements are presented in Indian Rupees (INR) in millions, except when otherwise indicated.

Estimation of uncertainties relating to the global health pandemic from COVID-19

The outbreak of COVID -19 pandemic has affected several countries across the world, including India. The Government is undertaking several measures to restrict the spread of virus and provide financial support to some stressed sectors. Further, while the COVID-19 vaccination efforts have gained momentum, uncertainty due to the resurgence of COVID cases across many parts of India is rising. The extent to which COVID-19 pandemic will impact the Company, if any, depends on future spread of the virus and related developments, which are uncertain at this point of time. There has been no material change in the controls or processes followed in the closing of the financial statements of the Company.

In preparing the accompanying financial results, the Company's management has view that there is no material impact of the pandemic on its operations and its assets as at March 31, 2023.

1.3    Presentation of financial statements

The Company presents its Balance sheet in order of liquidity in compliance with the Division III of the Schedule Ml to the Companies Act, 2013. An analysis regarding recovery or settlement within 12 months after the reporting date (current) and more than 12 months after the reporting date (non-current) is presented in note 38.

Financial assets and financial liabilities are generally reported gross in the balance sheet. They are only offset and reported net when, in addition to having an unconditional legally enforceable right to offset the recognised amounts without being contingent on a future event, the parties also intend to settle on a net basis in ail of the following circumstances:

®    The normal course of business

e    The event of default

® The event of insolvency or bankruptcy of the Company and or its counterparties

Significant accounting policies

1.4    Recognition of interest

Under Ind AS 109 interest income is recorded using the effective interest rate (EIR) method for all financial instruments measured at amortised cost and debt instrument measured at FVOCi. The EIR is the rate that exactly discounts estimated future cash receipts through the expected life of the financial asset to the gross carrying amount of the financial asset.

The EIR is calculated by taking into account any discount or premium on acquisition, fees and costs that are an integral part of the EIR. The Company recognises interest income using a rate of return that represents the best estimate of a constant rate of return over the expected life of the financial asset. Hence, it recognises the effect of potentially different interest rates charged at various stages, and other characteristics of the product life cycle including prepayments penalty interest and charges.

If expectations regarding the cash flows on the financial asset are revised for reasons other than credit risk, the adjustment is booked as a positive or negative adjustment to the carrying amount of the asset in the balance sheet with an increase or reduction in interest income.

The Company calculates interest income by applying the EIR to the gross carrying amount of financial assets other than credit-impaired assets.

When a financial asset becomes credit-impaired and is, therefore, regarded as 'Stage 3', the Company calculates interest income by applying the EIR to the amortised cost (net of expected credit loss) of the financial asset. If the financial assets cures and is no longer credit-impaired, the Company reverts to calculating interest income on a gross basis.

1.5    Financial Instruments

a)    Date of recognition

Financial assets and financial liabilities, with the exception of borrowings are initially recognised on the trade date, i.e., the date that the Company becomes a party to the contractual provisions of the instrument. This includes regular way trades: purchases or sales of financial assets that require delivery of assets within the time frame generally established by regulation or convention in the market place. The Company recognises borrowings when funds are available for utilisation to the Company.

b)    Initial measurement of financial instruments

Financial assets and financial liabilities are initially measured at fair value. Transaction costs that are directly attributable to the acquisition or issue of financial assets and financial liabilities (other than financial assets and financial liabilities at fair value through profit or loss) are added to or deducted from the fair value of the financial assets or financial liabilities, as appropriate, on initial recognition. Transaction costs directly attributable to the acquisition of financial assets or financial liabilities atfairvalue through profit or loss are recognised immediately in profit or loss.

c)    Day 1 profit or loss

When the transaction price of the financial instrument differs from the fair value at origination and the fair value is based on a valuation technique using only inputs observable in market transactions, the Company recognises the difference between the transaction price and fair value in net gain on fair value changes. In those cases where fair value is based on models for which some of the inputs are not observable, the difference between the transaction price and the fair value is deferred and is only recognised in profit or loss when the inputs become observable, or when the instrument is derecognised.

1.6    Classification of financial instruments

a) Financial assets:

The Company classifies all of its financial assets based on the business model for managing the assets and the asset's contractual terms, measured at either:

® Amortised cost

® Fair value through other comprehensive income [FVOC1]

® Fair value through profit or loss [FVTPL]

The Company measures financial assets that meet the following conditions at amortised cost:

® the financial asset is held within a business model whose objective is to hold financial assets in order to collect contractual cash flows; and

® 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.

Debt instruments that meet the following conditions are subsequently measured at fair value through other comprehensive income {except for debt instruments that are designated as at fair value through profit or loss on initial recognition};

® the financial asset is held within a business model whose objective is achieved both by collecting contractual cash flows and selling the financial assets; and ® 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.

By default all other financial assets are subsequently measured at FVTPL.

i.    Amortized cost and Effective interest method:

The effective interest method is a method of calculating the amortised cost of a debt instrument and of allocating interest income over the relevant period.

For financial instruments other than purchased or originated credit-impaired financial assets, the effective interest rate is the rate that exactly discounts estimated future cash receipts (including all fees paid or received that form an integral part of the effective interest rate, transaction costs and other premiums or discounts} excluding expected credit losses, through the expected life of the debt instrument, or, where appropriate, a shorter period, to the gross carrying amount of the debt instrument on initial recognition.

For purchased or originated credit-impaired financial assets, a credit-adjusted effective interest rate is calculated by discounting the estimated future cash flows, including expected credit losses, to the amortised cost of the debt instrument on initial recognition.

The amortised cost of a financial asset is the amount at which the financial asset is measured at initial recognition minus the principal repayments, plus the cumulative amortisation using the effective interest method of any difference between that initial amount and the maturity amount, adjusted for any loss allowance. On the other hand, the gross carrying amount of a financial asset is the amortised cost of a financial asset before adjusting for any loss allowance.

ii.    Investment in equity instruments

The Company subsequently measures ail equity investments at fair value through profit or loss, b} Financial liabilities;

All financial liabilities are measured at amortised cost except loan commitments, financial guarantees, and derivative financial liabilities.

c) Derivative financial instruments

The Company enters into a variety of derivative financial instruments to manage its exposure to interest rate, market risk.

1.6    Classification of financial instruments (Continued)

Derivatives are initially recognised at fair vaiue at the date the derivative contracts are entered into and are subsequently re-measured to their fair value at the end of each reporting period. The resulting gain or loss is recognised in profit or loss.

Debt securities and other borrowed funds

After initial measurement, debt issued and other borrowed funds are subsequently measured at amortised cost. Amortised cost is calculated by taking into account any discount or premium on issue funds, and costs that are an integral part of the EIR.

d)    Financial assets and Financial liabilities at fair value through profit or loss

Financial assets and financial liabilities in this category are those that are not held for trading and mandatorily required to be measured at fair value under ind AS 109.

Financial assets and financial liabilities at FVTPL are recorded in the balance sheet at fair value. Changes in fair value are recorded in profit and loss. Interest earned or incurred on instruments designated at FVTPL is accrued in interest income or finance cost, respectively, using the EIR, taking into account any discount/ premium and qualifying transaction costs being an integral part of instrument. Interest earned on assets mandatorily required to be measured at FVTPL is recorded using contractual interest rate.

e)    Financial liabilities and equity instruments

Financial instruments issued by the Company are classified as either financial liabilities or as equity in accordance with the substance of the contractual arrangements and the definitions of a financial liability and an equity instrument.

An equity instrument is any contract that evidences a residual interest in the assets of an entity after deducting all of its liabilities. Equity instruments issued by a Company entity are recognized at the proceeds received.

Repurchase of the Company's own equity instruments is recognized and deducted directly in equity. No gain or loss is recognized in profit or loss on the purchase, sale, issue or cancellation of the Company's own equity instruments.

1.7    Derecognition of financial assets and financial liabilities

a) Derecognition of financial assets due to substantial modification of terms and conditions:

The Company derecognises a financial asset, when the terms and conditions have been renegotiated to the extent that, substantially, it becomes a new financial asset, with the difference recognised as a derecognition gain or loss, to the extent that an impairment loss has not already been recorded.

If the modification does not result in cash flows that are substantially different, the modification does not result in derecognition. Based on the change in cash flows discounted at the original EIR, the Company records a modification gain or loss, to the extent that an impairment loss has not already been recorded.

1.7    Derecognition of financial assets and financial liabilities {Continued)

b)    Derecognition of financial assets (other than due to substantia! modification):

Afinancial asset (or, where applicable, a part of a financial asset or part of a group of similar financial assets) is derecognised when the rights to receive cash flows from the financial asset have expired. The Company also derecognises the financial asset if it has both transferred the financial asset and the transfer qualifies for derecognition. The difference between the carrying value of the original financial asset and the consideration received would be recognised in profit or loss.

The Company has transferred the financial asset if, and only if, either:

® The Company has transferred its contractual rights to receive cash flows from the financial asset; or

® It retains the rights to the cash flows, but has assumed an obligation to pay the received cash flows in full without material delay to a third party under a 'pass-through' arrangement.

c)    Derecognition of financial liabilities:

Afinancial liability is derecognized when the obligation under the liability is discharged, cancelled or expires. Where an existing financial liability is replaced by another from the same lender on substantially different terms, or the terms of an existing financial liability are substantially modified, such an exchange or modification is treated as a derecognition of the original financial liability and the recognition of a new financial liability. The difference between the carrying value of the original financial liability and the consideration paid, including modified contractual cash flow recognised as new financial liability, would be recognised in profit or loss.

1.8    Reclassification of financial assets and financial liabilities

The Company does not reclassify its financial assets subsequent to their initial recognition, apart from the exceptional circumstances in which the Company acquires, disposes of, or terminates a business line. Financial liabilities are never reclassified.

1.9    Impairment of financial assets

The Company follows 'simplified approach' for recognition of impairment loss allowance on trade receivables. The application of simplified approach does not require the Company to track changes in credit risk. Rather, it recognises impairment loss allowance based on lifetime (Expected Credit Loss (ECL) at each reporting date, right from its initial recognition. The Company uses a provision matrix to determine impairment loss allowance on portfolio of its receivables. The provision matrix is based on its historically observed default rates over the expected life of the receivables. However if receivables contain a significant financing component, the Company chooses as its accounting policy to measure the loss allowance by applying general approach to measure expected credit losses.

For ESOP funding and Receivables towards Margin Trading Funding, the Company recognises lifetime ECL when there has been a significant increase in credit risk (SICR) since initial recognition. If, on the other hand, the credit risk on the financial instrument has not increased significantly since initial recognition, the

Company measures the loss allowance for that financial instrument at an amount equal to 12-month expected credit losses (12m ECL). The assessment of whether lifetime ECLshould be recognised is based on significant increases in the likelihood or risk of a default occurring since initial recognition instead of an evidence of a financial asset being credit-impaired at the reporting date or an actual default occurring.

Lifetime ECL represents the expected credit losses that will result from all possible default events over the expected life of a financial instrument. In contrast, 12m ECL represents the portion of lifetime ECL that is expected to result from default events on a financial instrument that are possible within 12 months after the reporting date.

The measurement of ECL is a function of the probability of default (PD), loss given default (LGD) (i.e. the magnitude of the loss if there is a default) and the exposure at default (EAD). The assessment of the PD and LGD is based on historical data adjusted by forward-looking information. As for the EAD, for financial assets, this is represented by the assets' gross carrying amount at the reporting date; for loan commitments and financial guarantee contracts, the exposure includes the amount drawn down as at the reporting date, together with any additional amounts expected to be drawn down in the future by default date determined based on historical trend, the Company's understanding of the specific future financing needs of the debtors, and other relevant forward-looking information.

Company categories its ESOP funding and Receivables towards Margin Trading Funding as follows:

Stage 1 assets:

Stage 1 assets includes financial instruments that have not had a significant increase in credit risk since initial recognition or that have low credit risk at the reporting date. For these assets, 12-month ECL (resulting from default events possible within 12 months from reporting date) are recognised.

Stage 2 assets:

Stage 2 Assets includes financial instruments that have had a significant increase in credit risk since initial recognition. For these assets lifetime ECL are recognised.

Stage 3 assets:

Stage 3 for Assets considered credit-impaired the Company recognises the lifetime ECL for these loans. The method is similar to that for Stage 2 assets, with the PD set at 100%.

For all other financial assets, the expected credit loss is estimated as the difference between all contractual cash flows that are due to the Company in accordance with the contract and all the cash flows that the Company expects to receive, discounted at the original effective interest rate. The Company recognises an impairment gain or loss in profit or loss for all financial instruments with a corresponding adjustment to their carrying amount through a loss allowance account.

1.10    Collateral valuation

To mitigate its credit risks on financial assets, the Company seeks to use collateral, where possible. The collateral comes in various forms, such as cash, securities, and letters of guarantees. Collateral, unless repossessed, is not recorded on the balance sheet. However, the fair value of collateral affects the calculation of ECLs. It is generally assessed, at a minimum, at inception and re-assessed on a periodical basis. However, some collateral, for example, cash or securities relating to margining requirements, is valued daily.

To the extent possible, the Company uses active market data for valuing financial assets held as collateral. Other financial assets which do not have readily determinable market values are valued using models.

1.11    Collateral repossessed

The Company's policy is to determine whether a repossessed asset can be best used for its internal operations or should be sold. Assets determined to be useful for the internal operations are transferred to their relevant asset category at the lower of their repossessed value or the carrying value of the original secured asset. Assets for which selling is determined to be a better option are transferred to assets held for sale at their fair value (if financial assets} and fair value less cost to sell for non-financial assets at the repossession date in, line with the Company's policy.

1.12    Write off

Financial assets are written off either partially or in theirentirety only when the Company has no reasonable expectation of recovery.

1.13    Determination of fair value

The Company measures financial instruments, such as, derivatives at fair value at each balance sheet date. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair value measurement is based on the presumption that the transaction to sell the asset or transfer the liability takes place either;

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

0 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 by the Company.

The fair value of an asset or a liability is measured using the assumptions that market participants would use when pricing the asset or liability, assuming that market participants act in their economic best interest. A fair value measurement of a non-financial asset takes into account a market participant's ability to generate economic benefits by using the asset in its highest and best use or by selling it to another market participant that would use the asset in its highest and best use. The Company uses valuation techniques that are appropriate in the circumstances and for which sufficient data are available to measure fair value, maximising the use of relevant observable inputs and minimising the use of unobservable inputs. In order

1.13    Determination of fair value (Continued}

to show how fair values have been derived, financial instruments are classified based on a hierarchy of valuation techniques, as summarised below:

® Level 1 financial instruments - Those where the inputs used in the valuation are unadjusted quoted prices from active markets for identical assets or liabilities that the Company has access to at the measurement date. The Company considers markets as active only if there are sufficient trading activities with regards to the volume and liquidity of the identical assets or liabilities and when there are binding and exercisable price quotes available on the balance sheet date.

® Level 2 financial instruments - Those where the inputs that are used for valuation and are significant, are derived from directly or indirectly observable market data available over the entire period of the instrument's life.

® Level 3 financial instruments - Those that include one or more unobservable input that is significant to the measurement as whole. For assets and liabilities that are recognised in the financial statements on a recurring basis, the Company determines whether transfers have occurred between levels in the hierarchy by re-assessing categorization (based on the lowest level input that is significant to the fair value measurement as a whole) atthe end of each reporting period. The Company periodically reviews its valuation techniques including the adopted methodologies and model calibrations. However, the base models may not fully capture ail factors relevant to the valuation of the Company's financial instruments such as credit risk (CVA), own credit (DVA) and/or funding costs (FVA).

® Therefore, the Company applies various techniques to estimate the credit risk associated with its financial instruments measured at fair value, which include a portfolio-based approach that estimates the expected net exposure per counterparty over the full lifetime of the individual assets, in order to reflect the credit risk of the individual counterparties for non-coliateralised financial instruments.

The Company evaluates the levelling at each reporting period on an instrument-by-instrument basis and reclassifies instruments when necessary based on the facts at the end of the reporting period.

1.14    Revenue from contract with customer

Revenue is measured at fair value of the consideration received or receivable. Revenue is recognized when (or as) the Company satisfies a performance obligation by transferring a promised good or service (i.e. an asset) to a customer. An asset is transferred when (or as) the customer obtains control of that asset. When (or as) a performance obligation is satisfied, the Company recognizes as revenue the amount of the transaction price (excluding estimates of variable consideration) that is allocated to that performance obligation. The Company applies the five-step approach for recognition of revenue:

i)    Identification of contract(s) with customers;

ii)    Identification of the separate performance obligations in the contract;

iii)    Determination of transaction price;

iv)    Allocation of transaction price to the separate performance obligations; and

v)    Recognition of revenue when (or as) each performance obligation is satisfied The Company recognises revenue from the following sources:

a.    Brokerage income on securities broking business is recognised as per contracted rates at the execution of transactions on behalf of the customers on the trade date and is reflected net of related goods and service tax ("GST").

b.    Fee income including advisory fees, referral fees, commission income, and transaction fees is accounted at a point in time as the customer receives and consumes the benefits.

c.    Interest on delayed payments are recognised as revenue on certainty of realisation.

d.    Research services fee income is accounted when there is reasonable certainty as to its receipts.

e.    Interest income is recognized on accrual basis.

1.15 Leases

Company as a lessee:

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 applies a single recognition and measurement approach for all leases, except for short-term leases and leases of low-value assets. The Company recognises lease liabilities to make lease payments and right of use assets representing the right to use the underlying assets.

Right of Use Asset

The Company recognizes right of use assets at the commencement date of the lease (i.e., the date the underlying asset is available for use). Right of use assets are measured at cost, less any accumulated depreciation and impairment losses, and adjusted for any remeasurement of lease liabilities. The cost of right of use assets includes the amount of lease liabilities recognized, initial direct costs incurred, and lease payments made at or before the commencement date less any lease incentives received. Right of use assets are depreciated on a straight-line basis over the shorter of the lease term and the estimated useful lives of the assets.

Lease Liabilities

At the commencement date of the lease, the Company recognises lease liabilities measured at the present value of lease payments to be made over the lease term. The lease payments include fixed payments (including in substance fixed payments) less any lease incentives receivable, variable lease payments that depend on an index or a rate, and amounts expected to be paid under residual value guarantees. In calculating the present vaiue of lease payments, the Company uses its incremental borrowing rate at the lease commencement date because the interest rate implicit in the lease is not readily determinable. After

1.15    Leases (Continued)

Lease Liabilities (Continued)

the commencement date, the amount of lease liabilities is increased to reflect the accretion of interest and reduced for the lease payments made. In addition, the carrying amount of lease liabilities is remeasured if

there is a modification, a change in the lease term, a change in the lease payments (e.g., changes to future payments resulting from a change in an index or rate used to determine such lease payments) or a change in the assessment of an option to purchase the underlying asset.

Incremental borrowing rate

The Company cannot readily determine the interest rate implicit in the lease, therefore, it uses its incremental borrowing rate {'IBR') to measure lease liabilities. Incremental borrowing rate is the rate of interest that the Company would have to pay to borrow over a similar term, and with a similar security, the funds necessary to obtain an asset of a similar value to the right of use asset in a similar economic environment.

Short term lease

The Company has elected not to recognise right of use asset and lease liabilities for short term leases of property that has lease term of 12 months or less (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). The Company recognises lease payment associated with these leases as an expense on a straight line basis over lease term (refer note 33).

1.16    Earnings per share

Basic earnings per share is computed by dividing the net profit after tax attributable to the equity shareholders for the year by the weighted average number of equity shares outstanding for the year.

Diluted earnings per share reflect the potential dilution that could occur if securities or other contracts to issue equity shares were exercised or converted during the year. Diluted earnings per share is computed by dividing the net profit after tax attributable to the equity shareholders for the year by weighted average number of equity shares considered for deriving basic earnings per share and weighted average number of equity shares that could have been issued upon conversion of all potential equity shares.

1.17    Foreign currency transactions

The financial statements are presented in Indian Rupees which is also functional currency of the Parent. Transactions in currencies other than Indian Rupees (i.e. foreign currencies) are recognised at the rates of exchange prevailing at the dates of the transactions. At the end of each reporting period, monetary items denominated in foreign currencies are retranslated at the rates prevailing at that date. Non-monetary items carried at fair value that are denominated in foreign currencies are retranslated at the rates prevailing at the date when the fair value was determined. Non-monetary items that are measured in terms of historical cost in a foreign currency are not retranslated.

Exchange differences on monetary items are recognised in profit or loss in the period in which they arise.

Provident fund and national pension scheme

The Company contributes to a recognised provident fund and national pension scheme which Is a defined contribution scheme. The contributions are accounted for on an accrual basis and recognised in the statement of profit and loss.

Gratuity

The Company's gratuity scheme is a defined benefit plan. The Company's net obligation in respect of the gratuity benefit scheme is calculated by estimating the amount of future benefit that the employees have earned in return for their service in the current and prior periods, that benefit is discounted to determine its present value, and the fair value of any plan assets, if any, is deducted.

The present value of the obligation under such benefit plan is determined based on independent actuarial valuation using the Projected Unit Credit Method which recognises each period of services as giving rise to additional unit of employee benefit entitlement and measures each unit separately to build up the financial obligation.

The obligation is measured at present values of estimated future cash flows. The discounted rates used for determining the present value are based on the market yields on Government securities as at the balance sheet date.

Benefits in respect of gratuity are funded with an insurance Company approved by Insurance Regulatory and Development Authority (iRDA).

Remeasurements, comprising of actuarial gains and losses, the effect of the asset ceiling, excluding amounts included in net interest on the net defined benefit liability and the return on plan assets (excluding amounts included in net interest on the net defined benefit liability), are recognised immediately in the balance sheet with a corresponding debit or credit to retained earnings through OCI in the period in which they occur.

Remeasurements are not reclassified to profit or loss in subsequent periods.

Compensated Absences

The eligible employees of the Company are permitted to carryforward certain number of their annual leave entitlement to subsequent years, subject to a ceiling. The Company recognises the charge in the statement of profit and loss and corresponding liability on such non-vesting accumulated leave entitlement based on a valuation by an independent actuary. The cost of providing annual leave benefits is determined using the projected unit credit method.

1.19    Share-based payment arrangements

Equity-settled share-based payments to employees and others providing similar services that are granted by Edelweiss Financial Service Limited (EFSL) and current Holding Company Nuvama Wealth Management Limited (NWML) (formerly Edelweiss Securities Limited (ESL)) are measured by reference to the fair value of the equity instruments at the grant date.

The fair value determined at the grant date of the equity-settled share-based payments of NWML and EFSL is expensed in employee benefit expenses over the vesting period, based on the Company's estimate of equity instruments that will eventually vest. At the end of each reporting period, the Company revises its estimate of the number of equity instruments expected to vest. The impact of the revision of the original estimates, if any, is recognised in profit or loss such that the cumulative expense reflects the revised estimate. In cases where the share options granted vest in instalments over the vesting period, the Company treats each instalment as a separate grant, because each instalment has a different vesting period, and hence the fair value of each instalment differs.

1.20    Property, plant and equipment and Right of Use Asset

Property plant and equipment is stated at cost excluding the costs of day-to-day servicing, less accumulated depreciation and accumulated impairment in value. Changes in the expected useful life are accounted for by changing the amortization period or methodology, as appropriate, and treated as changes in accounting estimates.

Subsequent costs incurred on an item of property, plant and equipment is recognized in the carrying amount thereof when those costs meet the recognition criteria as mentioned above. Repairs and maintenance are recognized in profit or loss as incurred.

Depreciation is recognized so as to write off the cost of assets (other than freehold land and properties under construction) less their residual values over their useful lives. Depreciation is provided on a written down value basis from the date the asset is ready for its intended use or put to use whichever is earlier. In respect of assets sold, depreciation is provided upto the date of disposal.

As per the requirement of Schedule II of the Companies Act, 2013, the Company has evaluated the useful lives of the respective fixed assets which are as per the provisions of Part C of the Schedule II for calculating the depreciation. The estimated useful lives of the property, plant and equipment are as follows:

Estimated useful lives of the assets are as follows:

Nature of assets	Estimated useful life	Â
Furniture and fixtures	10 years	Â
Vehicles	8 years	Â
Office Equipment	5 years	Â
Computers - Servers and networks	6 years	Â
Computers - End user devices, such as desktops, laptops, etc.	3 years	Â

Leasehold improvements are amortized on a straight-line basis over the estimated useful lives of the assets or the period of lease whichever is earlier.

Right of use assets are presented together with property and equipment in the statement of financial position - refer to the accounting policy 1.15. Right of use assets are depreciated on a straight-line basis at the lower of lease term or useful life.

An item of property, plant and equipment is derecognized upon disposal or when no future economic benefits are expected to arise from the continued use of the asset. The carrying amount of those components which have been separately recognized as assets is derecognized at the time of replacement thereof. Any gain or loss arising on the disposal or retirement of an item of property, plant and equipment is determined as the difference between the sales proceeds and the carrying amount of the asset and is recognized in profit or loss.

The residual values, useful lives and methods of depreciation of property, plant and equipment are reviewed at each financial year end and adjusted prospectively, if appropriate.

1.21 Intangible assets

The Company's intangible assets mainly include the value of computer software. An intangible asset is recognized only when its cost can be measured reliably and it is probable thatthe expected future economic benefits that are attributable to it will flow to the Company.

Intangible assets acquired separately are measured on initial recognition at cost. The cost of intangible assets acquired in a business combination is their fair value as at the date of acquisition. Following initial recognition, intangible assets are carried at cost less any accumulated amortisation and any accumulated impairment losses. Intangible assets with finite lives are amortized over the useful economic life and assessed for impairment whenever there is an indication that the intangible asset may be impaired.

1.21    Intangible assets (Continued)

Intangibles such as software is amortized over a period of upto 5 years based on its estimated useful life.

An intangible asset is derecognised upon disposal (Le., at the date the recipient obtains control) or when no future economic benefits are expected from its use or disposal. Any gain or loss arising upon derecognition of the asset (calculated as the difference between the net disposal proceeds and the carrying amount of the asset) is included in the statement of profit or loss.

Intangible assets under development

Intangible assets under Development includes Software under development.

Research costs are expensed as incurred. Development expenditures on an individual project are recognised as an intangible asset when the Company can demonstrate:

i.    The technical feasibility of completing the intangible asset so that the asset will be available for use or sale.

ii.    Its intention to complete and its ability and intention to use or sell the asset

iii.    How the asset will generate future economic benefits

iv.    The availability of resources to complete the asset

v.    The ability to measure reliably the expenditure during development.

Following initial recognition of the development expenditure as an asset, the asset is carried at cost less any accumulated amortisation and accumulated impairment losses. Amortisation of the asset begins when development is complete, and the asset is available for use. It is amortised over the period of expected future benefit.

1.22    Impairment of non-financial assets

The Company assesses at each balance sheet date whether there is any indication that an asset may be impaired based on internal/external factors. If any such indication exists, the Company estimates the recoverable amount of the asset. If such recoverable amount of the asset or the recoverable amount of cash generating unit which the asset belongs to is less than its carrying amount, the carrying amount is reduced to its recoverable amount. An asset's recoverable amount is the higher of an asset's or Cash Generating Unit's (CGU's) fair value less costs of disposal and its value in use. The recoverable amount is determined for an individual asset, unless the asset does not generate cash inflows that are largely independent of those from other assets or groups of assets. The reduction is treated as an impairment loss and is recognized in the statement of profit and loss. If at the balance sheet date there is an indication that a previously assessed impairment loss no longer exists, the recoverable amount is reassessed and the asset is reflected at the recoverable amount subject to a maximum of the depreciable historical cost.

1.23    Cash and cash equivalents

Cash and cash equivalent in the balance sheet comprise cash at banks and on hand and short-term deposits with an original maturity of three months or less.

1.24    Provisions and other contingent liabilities

Provisions are recognized when the Company has a present obligation (legal or constructive) as a result of a past event, it is probable thatthe Company will be required to settle the obligation, and a reliable estimate can be made of the amount of the obligation. If the effect of the time value of money is material, provisions are determined by discounting the expected future cash flows to net present value using an appropriate pre-tax discount rate that reflects current market assessments of the time value of money and, where appropriate, the risks specific to the liability.

A present obligation that arises from past events, where it is either not probable that an outflow of resources will be required to settle or a reliable estimate of the amount cannot be made, is disclosed as a contingent liability. Contingent liabilities are also disclosed when there is a possible obligation arising from past events, the existence of which will be confirmed only by the occurrence or non-occurrence of one or more uncertain future events not wholly within the control of the Company. Claims against the Company, where the possibility of any outflow of resources in settlement is remote, are not disclosed as contingent liabilities.

Contingent assets are not recognized in the financial statements since this may result in the recognition of income that may never be realized. However, when the realization of income is virtually certain, then the related asset is not a contingent asset and is recognized.

1.25    Income tax expenses

Income tax expense represents the sum of the tax currently payable and deferred tax.

a)    Current tax

The tax currently payable is based on taxable profit for the year. Taxable profit differs from 'profit before tax' as reported in the statement of profit and loss because of items of income or expense that are taxable or deductible in other years and items that are never taxable or deductible. The Company's current tax is calculated using tax rates that have been enacted or substantively enacted by the end of the reporting period.

b)    Deferred tax

Deferred tax is recognised on temporary differences between the carrying amounts of assets and liabilities in the financial statements 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.

Deferred tax assets are also recognised with respect to carry forward of unused tax losses and unused tax credits to the extent that it is probable that future taxable profit will be available against which the unused tax losses and unused tax credits can be utilised.

It is probable that taxable profit will be available against which a deductible temporary difference, unused tax loss or unused tax credit can be utilised when there are sufficient taxable temporary differences which are expected to reverse in the period of reversal of deductible temporary difference or in periods in which a tax loss can be carried forward or back. When this is not the case, deferred tax asset is recognised to the

1.25 tricorne tax expenses (Continued)

extent it is probable that:

® the entity will have sufficient taxable profit in the same period as reversal of deductible temporary difference or periods in which a tax loss can be carried forward or back; or

® tax planning opportunities are available that will create taxable profit in appropriate periods.

The carrying amount of deferred tax assets is reviewed at the end of each reporting period 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.

Deferred tax liabilities and assets 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 end of the reporting period.

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 end of the reporting period, to recover or settle the carrying amount of its assets and liabilities.

c)    Current and deferred tax for the year

Current and deferred tax are recognised in profit or 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.

d)    Minimum alternate tax (MAT)

MAT paid in a year is charged to the Statement of Profit and Loss as current tax. The Company recognises unused MAT credit as a deferred tax asset only to the extent that it is probable that the Company will be able to utilise during the specified period, i.e., the period for which MAT credit is allowed to be carried forward. In the year in which the Company recognises deferred tax asset (MAT credit) as an asset, the said asset is created by way of credit to the Statement of Profit and Loss. The Company reviews the MAT asset at each reporting date and writes down the asset to the extentthat it is not probable that the Company will be able to utilise it during the specified period.

1.26 Critical accounting judgements and key sources of estimation uncertainty

In the application of the Company’s accounting policies the management is required to make judgements, estimates and assumptions about the carrying amounts of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised if the revision affects only that period, or in the period of the revision and future periods if the revision affects both current and future periods.

a)    Key sources of estimation uncertainty

The following are the key assumptions concerning the future, and other key sources of estimation uncertainty at the end of the reporting period that may have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year, as described below. The Company based its assumptions and estimates on parameters available when the financial statements were prepared. Existing circumstances and assumptions about future developments, however, may change due to market changes or circumstances arising that are beyond the control of the Company. Such changes are reflected in the assumptions when they occur.

b)    Effective interest rate method

The Company's EIR methodology recognises interest income / expense using a rate of return that represents the best estimate of a constant rate of return over the expected behavioural life of loans given/ taken and recognises the effect of characteristics of the product life cycle.

This estimation, by nature, requires an element of judgement regarding the expected behaviour and life-cycle of the instruments, as well expected changes fee income/expense that are integral parts of the instrument.

c)    Accounting for deferred taxes

Deferred tax assets are recognised for 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 judgement 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.

The Company has recognised deferred tax assets on carried forward tax losses where the Company believes that the said deferred tax assets shall be recoverable based on the estimated future taxable income which in turn is based on approved business plans and budgets. The losses are allowed to be carried forward to the years in which the Company expects that there will be sufficient taxable profits to offset these losses.

1.27 Standards issued but not notified (in accounting policy)

Ministry of Corporate Affairs ("MCA") notifies new standards or amendments to the existing standards under Companies (Indian Accounting Standards) Rules as issued from time to time. On March 31, 2023, MCA amended the Companies (Indian Accounting Standards) Amendment Rules, 2023, as below:

Ind AS 1 - Presentation of Financial Statements - This amendment requires the entities to disclose their material accounting policies rather than their significant accounting policies. The effective date for adoption of this amendment is annual periods beginning on or after April 1, 2023, The Company has evaluated the amendment and the impact of the amendment is insignificant in the Company's financial statements.

Ind AS 8 - Accounting Policies, Changes in Accounting Estimates and Errors -This amendment has introduced a definition of accounting estimates' and included amendments to Ind AS 8 to help entities distinguish changes in accounting policies from changes in accounting estimates. The effective date for adoption of this amendment is annual periods beginning on or after April 1, 2023. The Company has evaluated the amendment and there is no impact on its financial statements.

Ind AS 12 - Income Taxes - This amendment has narrowed the scope of the initial recognition exemption so that it does not apply to transactions that give rise to equal and offsetting temporary differences. The effective date for adoption of this amendment is annual periods beginning on or after April 1, 2023. The Company has evaluated the amendment and there is no impact on its financial statement.