Accounting Policies of RateGain Travel Technologies Ltd. Company

Mar 31, 2025

2.1 Material accounting policies

This note provides a list of the material accounting
policies adopted in the preparation of these
standalone financial statements. These policies
have been consistently applied to all the years
presented, unless otherwise stated.

(a) Basis of preparation

These standalone financial statements for the
year ended 31 March 2025 have been prepared
in accordance with the Indian Accounting
Standards (hereinafter referred to as the âInd
ASâ) as notified by Ministry of Corporate Affairs
pursuant to section 133 of the Companies Act,
2013 read with Rule 3 of the Companies (Indian
Accounting Standards) Rules, 2015 and other
relevant provisions of the Companies Act, 2013
as amended from time to time and guidelines
issued by Securities and Exchange Board of India
(SEBI) to the extent applicable.

The standalone financials statements are based
on the classification provisions contained in Ind
AS 1, "Presentation of Financial Statementsâ
and division II of Schedule III of the Act.
Further, for the purpose of clarity, various
items are dis-aggregated separately in the
notes to the financial statements, where
applicable or required.

The standalone financial statements for the year
ended 31 March 2025 were approved for issue
by the Board of Directors on 26 May 2025.

(b) Basis of measurement

The standalone financial statements have been
prepared on accrual and going concern basis
under historical cost convention except for
certain financial assets and financial liabilities
that are measured at fair value or amortized
cost, defined benefit obligations and share
based payments.

(c) Critical accounting estimates and
judgements

The preparation of standalone financial
statements in conformity with Ind AS requires
management to make judgements, estimates
and assumptions that affect the reported
amounts of revenues, expenses, assets and
liabilities and disclosure of contingent liabilities at
the end of the reporting period. Although these
estimates are based upon managementâs
best knowledge of current events and actions,
uncertainty about these assumptions and
estimates could result in the outcomes requiring
a material adjustment to the carrying amounts of
assets or liabilities in future periods. Changes in
estimates are reflected in the standalone financial
statements in the period in which changes are
made and if material, their effects are disclosed in
the notes to the standalone financial statements.

Information about significant areas of
estimation /uncertainty and judgements in
applying accounting policies that have the most
significant effect on the standalone financial
statements are as follows: -

Significant management judgements

Recognition of deferred tax assets - The extent
to which deferred tax assets can be recognized is
based on an assessment of the probability of the
Companyâs future taxable income against which
the deferred tax assets can be utilized.

Evaluation of indicators for impairment
of assets - The evaluation of applicability of
indicators of impairment of assets requires
assessment of several external and internal
factors which could result in deterioration of
recoverable amount of the assets.

Contingent liabilities - At each balance sheet
date basis the management judgment, changes
in facts and legal aspects, the Company assesses

the requirement of provisions against the
outstanding contingent liabilities. However, the
actual future outcome may be different from
this judgement.

Leases - Judgment required to ascertain lease
classification, lease term, incremental borrowing
rate, lease and non-lease component, and
impairment of ROU.

Significant estimates

Defined benefit obligation (DBO) -

Managementâs estimate of the DBO is based
on a number of underlying assumptions such
as standard rates of inflation, mortality, discount
rate and anticipation of future salary increases.
Variation in these assumptions may significantly
impact the DBO amount and the annual defined
benefit expenses.

Allowance for expected credit losses -

The allowance for doubtful debts reflects
managementâs estimate of losses inherent
in its credit portfolio. This allowance is based
on Companyâs estimate of the losses to be
incurred, which derives from past experience
with similar receivables, current and historical
past due amounts, write-offs and collections,
the careful monitoring of portfolio credit quality
and current and projected economic and market
conditions. Should the present economic and
financial situation persist or even worsen, there
could be a further deterioration in the financial
situation of the Companyâs debtors compared
to that already taken into consideration in
calculating the allowances recognised in the
financial statements.

Share based payments - Measurement of
share based payments; measurement of
financial guarantee contracts, provisions and
contingent liabilities.

There are no assumptions and estimation
uncertainties that have a significant risk of
resulting in a material adjustment within the
next financial year except for as disclosed in
these standalone financial statements.

(d) Fair value measurement

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:

â¢ In the principal market for the asset
or liability, or

â¢ In the absence of a principal market, in
the most advantageous market for the
asset or liability.

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

All assets and liabilities for which fair value
is measured or disclosed in the standalone
financial statements are categorized within fair
value hierarchy, described as follows, based on
the lowest level of input that is significant to the
fair value measurement as a whole.

â¢ Level 1 â Quoted (unadjusted) prices in
active markets for identical assets or liabilities

â¢ Level 2 â Valuation techniques for which
the lowest level input that is significant to
the fair value measurement is directly or
indirectly observable

â¢ Level 3 â Valuation techniques for which
the lowest level input that is significant to
the fair value measurement is unobservable

For assets and liabilities that are recognized in the
standalone 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.

For the purpose of fair value disclosures, the
Company has determined classes of assets and
liabilities on the basis of the nature, characteristics
and risks of the asset or liability and the level of
the fair value hierarchy as explained above.

2.2 Other material accounting policies

The accounting policies set out below have been
applied consistently to the periods presented in
the standalone financial statements.

(a) Property, plant equipment
Recognition and measurement

Items of property, plant and equipment are
measured at cost, less accumulated depreciation
and accumulated impairment losses.

The cost of an item of property, plant and
equipment comprises: (a) its purchase price
and non-refundable purchase taxes, after
deducting trade discounts and rebates; (b)
any costs directly attributable to bringing the
asset to the location and condition necessary
for it to be capable of operating in the manner
intended by management.

The cost of a self-constructed item of property,
plant and equipment comprises the cost of
materials and direct labour, any other cost
directly attributable to bringing the item to
working condition for its intended use.

The cost of improvements to leasehold
premises, if recognition criteria are met, are
capitalised and disclosed separately under
leasehold improvement.

An item of property, plant and equipment
and any significant part initially recognised
is derecognised upon disposal or when no
future economic benefits are expected from
its use or disposal. Any gain or loss arising on
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 and loss when such
asset is derecognised.

Subsequent cost

Subsequent costs are included in the assetâs
carrying amount or recognised as a separate
asset, as appropriate, only when it is probable that
the future economic benefits associated with
expenditure will flow to the Company and the
cost of the item can be measured reliably. All other
subsequent cost are charged to Statement of
profit and loss at the time of incurrence.

Depreciation

Depreciation on PPE is provided on the
straight-line method computed on the basis
of useful life prescribed in Schedule II to the

Companies Act, 2013 (âSchedule IIâ) on a pro-rata
basis from the date the asset is ready to put to use.

Leasehold improvements are depreciated
on a straight-line basis over the period of
the initial lease term or estimated useful life
whichever is shorter.

Depreciation is calculated on a pro rata basis for
assets purchased/sold during the year.

The residual values, useful lives and methods of
depreciation of property plant and equipment
are reviewed by management at each reporting
date and adjusted prospectively, as appropriate.

Capital work-in-progress

Cost of property, plant and equipment not ready
for use as at the reporting date are disclosed as
capital work-in-progress.

(b) Other intangible assets

Intangible assets that are acquired are
recognised only if it is probable that the
expected future economic benefits that are
attributable to the asset will flow to the Company
and the cost of assets can be measured reliably.
The other intangible assets are recorded at cost
of acquisition including incidental costs related
to acquisition and installation and are carried
at cost less accumulated amortisation and
impairment losses, if any.

Gain or losses arising from derecognition of other
intangible assets are measured as the difference
between the net disposal proceeds and the
carrying amount of the other intangible assets
and are recognised in the Statement of profit
and loss when the asset is derecognised.

Subsequent cost

Subsequent cost is capitalised only when
it increases the future economic benefits
embodied in the specific asset to which it
relates. All the subsequent expenditure on other

intangible assets is recognised in Statement of
profit and loss, as incurred.

Amortisation

Amortisation is calculated to write off the cost
of other intangible assets over their estimated
useful lives as stated below using straight-line
method. Amortisation is calculated on a
pro-rata basis for assets purchased /disposed
during the year.

The amortisation expense on intangible assets
with finite life is recognised in the statement of
profit and loss under the head Depreciation and
amortization expense.

Amortisation has been charged based on the
following useful lives:

Amortisation method, useful lives and residual
values are reviewed at each reporting date and
adjusted prospectively, if appropriate.

Derecognition of intangible asset

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.

(c) Leases

The Company as a lessee

The Company enters into an arrangement
for lease of buildings. Such arrangements are
generally for a fixed period but may have extension
or termination options. In accordance with Ind
AS 116 - Leases, at inception of the contract,
the Company assesses whether a contract is, or
contains a lease. A lease is defined as âa contract,
or part of a contract, that conveys the right to
control the use an asset (the underlying asset) for
a period of time in exchange for considerationâ.

To assess whether a contract conveys the right
to control the use of an identified asset, the
Company assesses whether:

â¢ The contract involves the use of an identified
asset - this may be specified explicitly or

implicitly, and should be physically distinct
or represent substantially all of the capacity
of a physically distinct asset. If the supplier
has a substantive substitution right, then
the asset is not identified;

â¢ The Company has the right to obtain
substantially all of the economic benefits
from use of the asset throughout the
period of use; and

â¢ The Company assesses whether it has the
right to direct âhow and for what purposeâ
the asset is used throughout the period of
use. At inception or on reassessment of a
contract that contains a lease component,
the Company allocates the consideration
in the contract to each lease component
on the basis of their relative stand-alone
prices. However, for the leases of land
and buildings in which it is a lessee, the
Company has elected not to separate
non-lease components and account for the
lease and non-lease components as a single
lease component.

Measurement and recognition of leases
as a lessee

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

The right-of-use assets is subsequently measured
at cost less any accumulated depreciation,
accumulated impairment losses.

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

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

â¢ fixed payments, including in-substance
fixed payments;

â¢ variable lease payments that depend on an
index or a rate, initially measured using the
index or rate as at the commencement date;

â¢ amounts expected to be payable under a
residual value guarantee; and

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

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

The Company presents right-of-use assets that
do not meet the definition of investment property
on the face of balance sheet below âproperty,
plant and equipmentâ and lease liabilities under
âfinancial liabilitiesâ in the balance sheet.

(d) Impairment - non-financial assets

continuing use that are largely independent
of the cash inflows of other assets or cash
generating units (âCGUâ). Goodwill arising from
a business combination is allocated to a CGU or
groups of CGU that are expected to benefit from
the synergies of the combination.

The recoverable amount of an asset or CGU is
the greater of its value in use and its fair value
less costs to sell. Value in use is based on the
estimated future cash flows, discounted to their
present value using a discount rate that reflects
current market assessments of the time value of
money and the risks specific to the asset or CGU.
An impairment loss is recognised if the carrying
amount of an asset or CGU exceeds its estimated
recoverable amount.

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

An impairment loss in respect of goodwill is not
reversed. For other assets, an impairment loss is
reversed only if there has been a change in the
estimates used to determine the recoverable
amount. Such a reversal is made only to the
extent that the assetâs carrying amount does
not exceed the carrying amount that would
have been determined, net of depreciation
or amortisation, if no impairment loss had
been recognised.

Mar 31, 2024

2.1 Material accounting policies

This note provides a list of the material accounting policies adopted in the preparation of these standalone financial statements. These policies have been consistently applied to all the years presented, unless otherwise stated.

(a) Basis of preparation

These standalone financial statements for the year ended 31 March 2024 have been prepared in accordance with the Indian Accounting Standards (hereinafter referred to as the âInd ASâ) as notified by Ministry of Corporate Affairs pursuant to section 133 of the Companies Act, 2013 read with Rule 3 of the Companies (Indian Accounting Standards) Rules, 2015 and other relevant provisions of the Companies Act, 2013 as amended from time to time and guidelines issued by Securities and Exchange Board of India (SEBI) to the extent applicable.

The standalone financial statements for the year ended 31 March 2024 were approved for issue by the Board of Directors on 21 May 2024.

(b) Basis of measurement

The standalone financial statements have been prepared on accrual and going concern basis under historical cost convention except for certain financial assets and financial liabilities that are measured at fair value or amortized cost, defined benefit obligations and share based payments.

The preparation of standalone financial statements in conformity with Ind AS requires management to make judgements, estimates andassumptionsthataffectthe reportedamounts of revenues, expenses, assets and liabilities and disclosure of contingent liabilities at the end of the reporting period. Although these estimates are based upon managementâs best knowledge of current events and actions, uncertainty about these assumptions and estimates could result in the outcomes requiring a material adjustment to the carrying amounts of assets or liabilities in future periods. Changes in estimates are reflected in the standalone financial statements in the period in which changes are made and if material, their effects are disclosed in the notes to the standalone financial statements.

Information about significant areas of estimation /uncertainty and judgements in applying accounting policies that have the most significant effect on the standalone financial statements are as follows: -

Significant management judgements

Recognition of deferred tax assets - The extent to which deferred tax assets can be recognized is based on an assessment of the probability of the Companyâs future taxable income against which the deferred tax assets can be utilized.

Evaluation of indicators for impairment of assets - The evaluation of applicability of indicators of impairment of assets requires assessment of several external and internal factors which could result in deterioration of recoverable amount of the assets.

Contingent liabilities - At each balance sheet date basis the management judgment, changes in facts and legal aspects, the Company assesses the requirement of provisions against the outstanding contingent liabilities. However, the actual future outcome may be different from this judgement.

Leases - Judgment required to ascertain lease classification, lease term, incremental borrowing rate, lease and non-lease component, and impairment of ROU.

Defined benefit obligation (DBO) -

Managementâs estimate of the DBO is based on a number of underlying assumptions such as standard rates of inflation, mortality, discount rate and anticipation of future salary increases. Variation in these assumptions may significantly impact the DBO amount and the annual defined benefit expenses.

Allowance for expected credit losses -

The allowance for doubtful debts reflects managementâs estimate of losses inherent in its credit portfolio. This allowance is based on Companyâs estimate of the losses to be incurred, which derives from past experience with similar receivables, current and historical past due amounts, write-offs and collections, the careful monitoring of portfolio credit quality and current and projected economic and market conditions. Should the present economic and financial situation persist or even worsen, there could be a further deterioration in the financial situation of the Companyâs debtors compared to that already taken into consideration in calculating the allowances recognised in the financial statements.

Share based payments - Measurement of share based payments; measurement of financial guarantee contracts, provisions and contingent liabilities.

Projections - cash flow projections and liquidity assessment.

There are no assumptions and estimation uncertainties that have a significant risk of resulting in a material adjustment within the next financial year except for as disclosed in these standalone financial statements.

(d) Fair value measurement

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:

â¢ In the principal market for the asset or liability, or

â¢ In the absence of a principal market, in the most advantageous market for the asset or liability.

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

All assets and liabilities for which fair value is measured or disclosed in the standalone financial statements are categorized within fair value hierarchy, described as follows, based on the lowest level of input that is significant to the fair value measurement as a whole.

â¢ Level 1 â Quoted (unadjusted) prices in active markets for identical assets or liabilities

â¢ Level 2 â Valuation techniques for which the lowest level input that is significant to the fair value measurement is directly or indirectly observable

â¢ Level 3 â Valuation techniques for which the lowest level input that is significant to the fair value measurement is unobservable

For assets and liabilities that are recognized in the standalone 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.

For the purpose of fair value disclosures, the Company has determined classes of assets and liabilities on the basis of the nature, characteristics and risks of the asset or liability and the level of the fair value hierarchy as explained above.

2.2 Other material accounting policies

The accounting policies set out below have been applied consistently to the periods presented in the standalone financial statements.

(a) Property, plant equipment

Recognition and measurement

Items of property, plant and equipment are measured at cost, less accumulated depreciation and accumulated impairment losses.

The cost of an item of property, plant and equipment comprises: (a) its purchase price and non-refundable purchase taxes, after deducting trade discounts and rebates; (b) any costs directly attributable to bringing the asset to the location and condition necessary for it to be capable of operating in the manner intended by management.

The cost of a self-constructed item of property, plant and equipment comprises the cost of materials and direct labour, any other cost directly attributable to bringing the item to working condition for its intended use.

The cost of improvements to leasehold premises, if recognition criteria are met, are capitalised and disclosed separately under leasehold improvement.

An item of property, plant and equipment and any significant part initially recognised is derecognised upon disposal or when no future economic benefits are expected from its use or disposal. Any gain or loss arising on 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 and loss when such asset is derecognised.

Subsequent cost

Subsequent costs are included in the assetâs carrying amount or recognised as a separate asset, as appropriate, only when it is probable that the future economic benefits associated with expenditure will flow to the Company and the cost of the item can be measured reliably. All other subsequent cost are charged to Statement of profit and loss at the time of incurrence.

Depreciation

Depreciation on PPE is provided on the straight-line method computed on the basis of useful life prescribed in Schedule II to the Companies Act, 2013 (âSchedule IIâ) on a pro-rata basis from the date the asset is ready to put to use.

Block of asset	Useful life as per
	Companies Act,
	2013 (in years)
Computer	3
Furniture and fixture	10
Office equipment	5

Leasehold improvements are depreciated on a straight-line basis over the period of the initial lease term or estimated useful life whichever is shorter.

Depreciation is calculated on a pro rata basis for assets purchased/sold during the year.

The residual values, useful lives and methods of depreciation of property plant and equipment are reviewed by management at each reporting date and adjusted prospectively, as appropriate.

Capital work-in-progress

Cost of property, plant and equipment not ready for use as at the reporting date are disclosed as capital work-in-progress.

(b) Other intangible assets

Intangible assets that are acquired are recognised only if it is probable that the expected future economic benefits that are attributable to the asset will flow to the Company and the cost of assets can be measured reliably. The other intangible assets are recorded at cost of acquisition including incidental costs related to acquisition and installation and are carried at cost less accumulated amortisation and impairment losses, if any.

Gain or losses arising from derecognition of other intangible assets are measured as the difference between the net disposal proceeds and the carrying amount of the other intangible assets and are recognised in the Statement of profit and loss when the asset is derecognised.

Subsequent cost

Subsequent cost is capitalised only when it increases the future economic benefits embodied in the specific asset to which it relates. All the subsequent expenditure on other intangible assets is recognised in Statement of profit and loss, as incurred.

Amortisation

Amortisation is calculated to write off the cost of other intangible assets over their estimated useful lives as stated below using straight-line method. Amortisation is calculated on a pro-rata basis for assets purchased /disposed during the year.

The amortisation expense on intangible assets with finite life is recognised in the statement of profit and loss under the head Depreciation and amortization expense.

Amortisation has been charged based on the following useful lives:

Asset description	Useful life of asset (in years)
Computer software	3

Amortisation method, useful lives and residual values are reviewed at each reporting date and adjusted prospectively, if appropriate.

Derecognition of intangible asset

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.

The Company as a lessee

The Company enters into an arrangement for lease of buildings. Such arrangements are generally for a fixed period but may have extension or termination options. In accordance with Ind AS 116 - Leases, at inception of the contract, the Company assesses whether a contract is, or contains a lease. A lease is defined as âa contract, or part of a contract, that conveys the right to control the use an asset (the underlying asset) for a period of time in exchange for considerationâ.

To assess whether a contract conveys the right to control the use of an identified asset, the Company assesses whether:

â¢ The contract involves the use of an identified asset - this may be specified explicitly or implicitly, and should be physically distinct or represent substantially all of the capacity of a physically distinct asset. If the supplier has a substantive substitution right, then the asset is not identified;

â¢ The Company has the right to obtain substantially all of the economic benefits from use of the asset throughout the period of use; and

â¢ The Company assesses whether it has the right to direct âhow and for what purposeâ the asset is used throughout the period of use. At inception or on reassessment of a contract that contains a lease component, the Company allocates the consideration in the contract to each lease component on the basis of their relative stand-alone prices. However, for the leases of land and buildings in which it is a lessee, the Company has elected not to separate non-lease components and account for the lease and non-lease components as a single lease component.

Measurement and recognition of leases as a lessee

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

The right-of-use assets is subsequently measured at cost less any accumulated depreciation, accumulated impairment losses.

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

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

â¢ fixed payments, including in-substance fixed payments;

â¢ variable lease payments that depend on an index or a rate, initially measured using the index or rate as at the commencement date;

â¢ amounts expected to be payable under a residual value guarantee; and

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

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

The Company presents right-of-use assets that do not meet the definition of investment property on the face of balance sheet below âproperty, plant and equipmentâ and lease liabilities under âfinancial liabilitiesâ in the balance sheet.

(d) Impairment - non-financial assets

At each reporting date, the Company reviews the carrying amounts of its non-financial assets to determine whether there is any indication of impairment. If any such indication of impairment exists, then the assetâs recoverable amount is estimated. For impairment testing, assets are grouped together into the smallest group of assets that generates cash inflows from continuing use that are largely independent of the cash inflows of other assets or cash generating units (âCGUâ). Goodwill arising from a business combination is allocated to a CGU or groups of CGU that are expected to benefit from the synergies of the combination.

money and the risks specific to the asset or CGU. An impairment loss is recognised if the carrying amount of an asset or CGU exceeds its estimated recoverable amount.

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

An impairment loss in respect of goodwill is not reversed. For other assets, an impairment loss is reversed only if there has been a change in the estimates used to determine the recoverable amount. Such a reversal is made only to the extent that the assetâs carrying amount does not exceed the carrying amount that would have been determined, net of depreciation or amortisation, if no impairment loss had been recognised.

Mar 31, 2023

1 Company information/overview

RateGain Travel Technologies Limited (formerly known as RateGain Travel Technologies Private Limited) is a public limited company domiciled in India, having its registered office at M-140, Greater Kailash Part II, New Delhi - 110048. The Company was incorporated on 16 November 2012 as a private limited company in India. During the current year, status of the Company has been changed from private to public company. Consequently, the name of âRateGain Travel Technologies Private Limitedâ has been changed to âRateGain Travel Technologies Limitedâ and a fresh certificate of incorporation pursuant to this change of name has been issued by the Registrar of Companies on 27 July 2021. The Company is listed on the BSE Limited (BSE) and the National Stock Exchange of India Limited (NSE).

The Company is an Information Technology company providing innovative solutions to help clients in the hospitality and travel industry to achieve their business goals.

2.1 Significant accounting policies

This note provides a list of the significant accounting policies adopted in the preparation of these standalone financial statements. These policies have been consistently applied to all the years presented, unless otherwise stated.

(a) Basis of preparation

These standalone financial statements for the year ended 31 March 2023 have been prepared in accordance with the Indian Accounting Standards (hereinafter referred to as the âInd ASâ) as notified by Ministry of Corporate Affairs pursuant to section 133 of the Companies Act, 2013 read with Rule 3 of the Companies (Indian Accounting Standards) Rules, 2015 and other relevant provisions of the Companies Act, 2013 as amended from time to time and guidelines issued by Securities and Exchange Board of India (SEBI) to the extent applicable.

The standalone financial statements for the year ended 31 March 2023 were approved for issue by the Board of Directors on 19 May 2023.

(b) Basis of measurement

The standalone financial statements have been prepared on accrual and going concern basis under historical cost convention except for certain financial assets and financial liabilities that are measured at fair value or amortized cost, defined benefit obligations and share based payments.

(c) Critical accounting estimates and judgements

The preparation of standalone financial statements in conformity with Ind AS requires management to make judgements, estimates and assumptions that affect the reported amounts of revenues, expenses, assets and liabilities and disclosure of contingent liabilities at the end of the reporting period. Although these estimates are based upon managementâs best knowledge of current events and actions, uncertainty about these assumptions and estimates could result in the outcomes requiring a material adjustment to the carrying amounts of assets or liabilities in future periods. Changes in estimates are reflected in the standalone financial statements in the period in which changes are made and if material, their effects are disclosed in the notes to the standalone financial statements.

Information about significant areas of estimation /uncertainty and judgements in applying accounting policies that have the most significant effect on the standalone financial statements are as follows: -

Significant management judgements Recognition of deferred tax assets - The

extent to which deferred tax assets can be recognized is based on an assessment of the probability of the Companyâs future taxable income against which the deferred tax assets can be utilized.

Evaluation of indicators for impairment of assets - The evaluation of applicability of indicators of impairment of assets requires assessment of several external and internal factors which could result in deterioration of recoverable amount of the assets.

Leases- Judgment required to ascertain lease classification, lease term, incremental borrowing rate, lease and non-lease component, and impairment of ROU.

Significant estimates

Defined benefit obligation (DBO) -

Managementâs estimate of the DBO is based on a number of underlying assumptions such as standard rates of inflation, mortality, discount rate and anticipation of future salary increases. Variation in these assumptions may significantly impact the DBO amount and the annual defined benefit expenses.

Allowance for expected credit losses -

The allowance for doubtful debts reflects managementâs estimate of losses inherent in its credit portfolio. This allowance is based on Companyâs estimate of the losses to be incurred, which derives from past experience with similar receivables, current and historical past due amounts, write-offs and collections, the careful monitoring of portfolio credit quality and current and projected economic and market conditions. Should the present economic and financial situation persist or even worsen, there could be a further deterioration in the financial situation of the Companyâs debtors compared to that already taken into consideration in calculating the allowances recognised in the financial statements.

Share based payments - Measurement of share based payments; measurement of financial guarantee contracts, provisions and contingent liabilities.

Projections - cash flow projections and liquidity assessment.

There are no assumptions and estimation uncertainties that have a significant risk of

resulting in a material adjustment within the next financial year except for as disclosed in these standalone financial statements.

(d) Fair value measurement

â¢ In the principal market for the asset or liability, or

â¢ In the absence of a principal market, in the most advantageous market for the asset or liability.

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

All assets and liabilities for which fair value is measured or disclosed in the standalone financial statements are categorized within fair value hierarchy, described as follows, based on the lowest level of input that is significant to the fair value measurement as a whole.

â¢ Level 1 â Quoted (unadjusted)

prices in active markets for identical assets or liabilities

â¢ Level 2 â Valuation techniques for which the lowest level input that is significant to the fair value measurement is directly or indirectly observable

â¢ Level 3 â Valuation techniques for which the lowest level input that is significant to the fair value measurement is unobservable

For assets and liabilities that are recognized in the standalone 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.

For the purpose of fair value disclosures, the Company has determined classes of assets and liabilities on the basis of the nature, characteristics and risks of the asset or liability and the level of the fair value hierarchy as explained above.

2.2 Other significant accounting policies

The accounting policies set out below have been

applied consistently to the periods presented in

the standalone financial statements.

(a) Property, plant equipment

Recognition and measurement Items of property, plant and equipment are measured at cost, less accumulated depreciation and accumulated

impairment losses.

The cost of an item of property, plant and equipment comprises: (a) its purchase price and non-refundable purchase taxes, after deducting trade discounts and rebates; (b) any costs directly attributable to bringing the asset to the location and condition necessary for it to be capable of operating in the manner intended by management.

The cost of a self-constructed item of property, plant and equipment comprises the cost of materials and direct labour, any other cost directly attributable to bringing the item to working condition for its intended use.

The cost of improvements to leasehold premises, if recognition criteria are met, are capitalised and disclosed separately under leasehold improvement.

An item of property, plant and equipment and any significant part initially recognised is derecognised upon disposal or when no future economic benefits are expected from its use or disposal. Any gain or loss arising on 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 and loss when such asset is derecognised.

Subsequent cost

Subsequent costs are included in the assetâs carrying amount or recognised as a separate asset, as appropriate, only when it is probable that the future economic benefits associated with expenditure will flow to the Company and the cost of the item can be measured reliably. All other subsequent cost are charged to Statement of profit and loss at the time of incurrence.

Depreciation

Block of asset	Useful life as per
	Companies Act,
	2013 (in years)
Computer	3
Furniture and fixture	10
Office equipment	5

Leasehold improvements are depreciated on a straight-line basis over the period of the initial lease term or estimated useful life whichever is shorter.

Depreciation is calculated on a pro rata basis for assets purchased/sold during the year.

The residual values, useful lives and methods of depreciation of property plant and equipment are reviewed by management at each reporting date and adjusted prospectively, as appropriate.

Capital work-in-progress Cost of property, plant and equipment not ready for use as at the reporting date are disclosed as capital work-in-progress.

(b) Other intangible assets

Intangible assets that are acquired are recognised only if it is probable that the

expected future economic benefits that are attributable to the asset will flow to the Company and the cost of assets can be measured reliably. The other intangible assets are recorded at cost of acquisition including incidental costs related to acquisition and installation and are carried at cost less accumulated amortisation and impairment losses, if any.

Gain or losses arising from derecognition of other intangible assets are measured as the difference between the net disposal proceeds and the carrying amount of the other intangible assets and are recognised in the Statement of profit and loss when the asset is derecognised.

Subsequent cost

Amortisation

Amortisation is calculated to write off the cost of other intangible assets over their estimated useful lives as stated below using straight-line method. Amortisation is calculated on a pro-rata basis for assets purchased /disposed during the year.

The amortisation expense on intangible assets with finite life is recognised in the statement of profit and loss under the head Depreciation and amortization expense.

Amortisation has been charged based on the following useful lives:

Asset description

Useful life of asset (in years)

Computer

software

Amortisation method, useful lives and residual values are reviewed at each reporting date and adjusted prospectively, if appropriate.

Derecognition of intangible asset 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.

(c) Leases

The Company as a lessee The Company enters into an arrangement for lease of buildings. Such arrangements are generally for a fixed period but may have extension or termination options. In accordance with Ind AS 116 - Leases, at inception of the contract, the Company assesses whether a contract is, or contains a lease. A lease is defined as âa contract, or part of a contract, that conveys the right to control the use an asset (the underlying asset) for a period of time in exchange for considerationâ.

To assess whether a contract conveys the right to control the use of an identified asset, the Company assesses whether:

â¢ The Company has the right to obtain substantially all of the economic benefits from use of the asset throughout the period of use; and

â¢ The Company assesses whether it has the right to direct âhow and for what purposeâ the asset is used throughout the period of use. At inception or on reassessment of a contract that contains a lease component, the Company allocates the consideration in the contract to each lease component on the basis of their relative stand-alone prices. However, for the leases of land and buildings in which it is a lessee, the Company has elected not to separate

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

Measurement and recognition of leases as a lessee

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

The right-of-use assets is subsequently measured at cost less any accumulated depreciation, accumulated

impairment losses.

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

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

â¢ fixed payments, including in-substance fixed payments;

â¢ variable lease payments that depend on an index or a rate, initially measured using the index or rate as at the commencement date;

â¢ amounts expected to be payable under a residual value guarantee; and

â¢ the exercise price under a purchase option that the Company is reasonably certain to exercise, lease payments in an optional renewal period if the Company

is reasonably certain to exercise an extension option, and penalties for early termination of a lease unless the Company is reasonably certain not to terminate early.

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

The Company presents right-of-use assets that do not meet the definition of investment property on the face of balance sheet below âproperty, plant and equipmentâ and lease liabilities under âfinancial liabilitiesâ in the balance sheet.

(d) Impairment - non-financial assets

discount rate that reflects current market assessments of the time value of money and the risks specific to the asset or CGU. An impairment loss is recognised if the carrying amount of an asset or CGU exceeds its estimated recoverable amount.

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

An impairment loss in respect of goodwill is not reversed. For other assets, an impairment loss is reversed only if there has been a change in the estimates used to determine the recoverable amount. Such a reversal is made only to the extent that the assetâs carrying amount does not exceed the carrying amount that would have been determined, net of depreciation or amortisation, if no impairment loss had been recognised.

(e) Provisions and contingent liabilities

Provisions

Provisions are recognised when the Company has a present legal or constructive obligation as a result of a past events, it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and a reliable estimate can be made of the amount of the obligation.

I f the effect of the time value of money is material, provisions are discounted using a current pre-tax rate that reflects current market assessments of the time value of money and the risks specific to the liability. When discounting is used, the increase in the provision due to the passage of time is recognised as a finance cost.

Contingent liabilities

Contingent liabilities are possible obligations that arise from past events and whose existence will only be confirmed by the occurrence or non-occurrence of one or more uncertain future events not wholly

within the control of the Company. Where it is not probable that an outflow of economic benefits will be required, or the amount cannot be estimated reliably, the obligation is disclosed as a contingent liability, unless the probability of outflow of economic benefits is remote.

(f) Employee benefits

Short-term employee benefits Employee benefit liabilities such as salaries, wages and bonus, etc. that are expected to be settled wholly within twelve months after the end of the reporting period in which the employees render the related service are recognised in respect of employeeâs services up to the end of the reporting period and are measured at an undiscounted amount expected to be paid when the liabilities are settled.

Post-employment benefit plans Defined contribution plans A defined contribution plan is a post-employment benefit plan under which the Company pays fixed contributions into a separate entity and will have no legal or constructive obligation to pay further amounts. Payments to defined contribution plans are recognised as an expense when employees have rendered service entitling them to the contributions.

Defined benefit plans

The Company has an obligation towards gratuity, a defined benefit retirement plan covering eligible employees. The plan provides for a lump sum payment to vested employees at retirement, death while in employment or on termination of employment, of an amount based on the respective employeeâs salary and the tenure of employment.

The liability recognised in the Balance Sheet in respect of defined benefit gratuity plan is the present value of the defined benefit obligation at the end of the reporting period. The defined benefit obligation is calculated by actuary using the projected unit credit method.

The present value of the defined benefit obligation is determined by discounting the estimated future cash outflows by reference to market yields at the end of the reporting period on government bonds that have terms approximating to the terms of the related obligation.

The net interest cost is calculated by applying the discount rate to the net balance of the defined benefit obligation. This cost and other costs are included in employee benefits expense in the Statement of profit and loss.

Remeasurements of the net defined benefit liability, which comprise actuarial gains and losses, the return on plan assets (excluding interest) and the effect of the asset ceiling (if any, excluding interest), are recognised in other comprehensive income and transferred to retained earnings.

Changes in the present value of the defined benefit obligation resulting from settlement or curtailments are recognised immediately in Statement of profit and loss as past service cost.

The Companyâs net obligation in respect of defined benefit plans is calculated by estimating the amount of future benefit that employees have earned in the current and prior periods, discounting that amount and deducting the fair value of any plan assets.

Other long-term employee benefits Compensated absences The Companyâs net obligation in respect of compensated absences is the amount of benefit to be settled in future, that employees have earned in return for their service in the current and previous years. The benefit is discounted to determine its present value. The obligation is measured on the basis of an actuarial valuation using the projected unit credit method. Remeasurements are recognised in Statement of profit and loss in the period in which they arise.

(g) Share based payments

The fair value on grant date of equity-settled share-based payment arrangements granted to eligible employees of the Company under the Employee Stock Option Scheme (âESOSâ) is recognised as employee stock option scheme expenses in the Statement of profit and loss, in relation to options granted to employees of the Company (over the vesting period of the awards), with a corresponding increase in other equity. The amount recognised as an expense to reflect the number of awards for which the related service and non-market performance conditions are expected to be met, such that the amount ultimately recognised is based on the number of awards that meet the related service and non-market performance conditions at the vesting date. The increase in equity recognised in connection with a share based payment transaction is presented in the "Employee stock options outstanding accountâ, as separate component in other equity. For share-based payment awards with market conditions, the grant- date fair value of the share-based payment is measured to reflect such conditions and there is no true- up for differences between expected and actual outcomes. At the end of each period, the Company revises its estimates of the number of options that are expected to be vested based on the non-market performance conditions at the vesting date.

In case of cash-settled plan, fair value is determined on each reporting date and expense is accordingly recognised in the statement of profit and loss with a corresponding increase to the ESOP liability.

If vesting periods or other vesting conditions apply, the expense is allocated over the vesting period, based on the best available estimate of the number of share options expected to vest. Upon exercise of share options, the proceeds received, net of any directly attributable transaction costs, are allocated to share capital up to the nominal (or par) value of the shares issued with any excess being recorded as share premium.

The dilutive effect of outstanding options is reflected as additional share dilution in the computation of diluted earnings per share.

(h) Income taxes

Income tax expense comprises of current tax and deferred tax. It is recognised in the statement of profit or loss except to the extent that it relates to items recognised in other comprehensive income or directly in equity.

Current tax

Current tax comprises the expected tax payable or receivable on the taxable income or loss for the year and any adjustment to the tax payable or receivable in respect of previous years. The amount of current tax reflects the best estimate of the tax amount expected to be paid or received after considering the uncertainty, if any relating to income taxes. It is measured using tax rates enacted for the relevant reporting period.

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

Deferred tax

Deferred tax is recognised in respect of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the corresponding amounts used for taxation purposes.

Deferred tax liabilities are recognised for all taxable temporary differences. Deferred tax assets are recognised to the extent that it is probable that future taxable profits will be available against which they can be used. The existence of unused tax losses is strong evidence that future taxable profit may not be available. Therefore, in case of a history of recent losses, the Company recognises a deferred tax asset only to the extent that it has sufficient taxable temporary differences or there is convincing other evidence that sufficient taxable profit will be available against which such deferred tax asset can be realised. Deferred tax assets -unrecognised or recognised, are reviewed at each reporting date and are recognised / reduced to the extent that it is probable / no longer probable respectively that the related tax benefit will be realised.

Deferred tax is measured at the tax rates that are expected to apply to the period when the asset is realised or liability is settled, based on the laws that have been enacted or substantively enacted by the reporting date.

The measurement of deferred tax reflects the tax consequences that would follow from the manner in which the Company expects, at the reporting date, to recover or settle the carrying amount of its assets and liabilities.

Deferred tax assets and deferred tax liabilities are offset only if there is a legally enforceable right to offset current tax liabilities and assets levied by the same tax authorities.

(i) Foreign currency transactions and translations

Monetary and non-monetary transactions in foreign currencies are initially recorded in the functional currency of the Company at the exchange rates at the date of the transactions.

Monetary foreign currency assets and liabilities remaining unsettled on reporting date are translated at the rates of exchange prevailing on reporting date. Gains/(losses) arising on account of realisation/settlement of foreign exchange transactions and on translation of monetary foreign currency assets and liabilities are recognised in the Statement of profit and loss.

Foreign exchange gains / (losses) arising on translation of foreign currency monetary loans are presented in the Statement of profit and loss on net basis. However, foreign exchange differences arising from foreign currency monetary loans to the extent regarded as an adjustment to borrowing

(j) Revenue recognition

Revenue from Contracts with Customers is recognised upon transfer of control of promised services to customers. Revenue is measured at the transaction price (net of variable consideration) which is the consideration received or receivable, excluding discounts, incentives, performance bonuses, price concessions, amounts collected on behalf of third parties, or other similar items, if any, as specified in the contract with the customer. Revenue is recorded provided the recovery of consideration is probable and determinable.

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

The Company derived its revenue from service which is categorized in below 2 categories:

1. DAAS: It is a AI led Products to gauge Demand and optimise pricing which help in providing data and information to players across the travel & hospitality industry and delivering insights including competitive and rate parity intelligence.

2. Distribution: It is a AI led product to standardise content distribution which provide Seamless connectivity between Hotels and their demand partners including OTAs, GDS and others and communicate availability, rates, inventory and content to its customers.

Revenue from sale of services (1) Revenue from sale of services in case of hospitality sector is recognised when the services are performed through an indefinite number of repetitive acts over the specified subscription period on straight line basis or on the basis of underlying services performed, as the case may be, in accordance

with the terms of the contracts with customers and in case of travel sector the same is recognised when the related services are performed as per the terms of contracts.

Revenue from sale of transaction based services are recognised on point in time.

The Company defers unearned revenue, including payments received in advance, until the related subscription period is complete or underlying services are performed.

(2) Revenue from sale of service being marketing support services, management fee and auxiliary and business support services are recognised on the basis of satisfaction of performance obligation over the duration of the contract from the date the contracts are effective or signed provided the consideration is reliably determinable and no significant uncertainty exists regarding the collection. The amount recognised as revenue is net of applicable taxes.

No significant element of financing is deemed present as the sale of services are made with a credit term of 30 to 60 days, which is consistent with market practice.

Manpower services to subsidiaries The Company provided manpower services to its subsidiary companies. Revenue from manpower services to subsidiaries is recognised as per the terms of agreement with these subsidiaries.

Interest income

Interest income on financial assets (including deposits with banks) is recognised using the effective interest rate method.

(k) Financial instruments

A financial instrument is any contract that

gives rise to a financial asset of one entity

and a financial liability or equity instrument of another entity.

Financial assets

Recognition and initial measurement

Trade receivables and debt instruments are initially recognised when they are originated. All other financial assets are initially recognised when the Company becomes a party to the contractual provisions of the instrument. All financial assets are initially measured at fair value plus, for an item not at fair value through Statement of profit and loss, transaction costs that are attributable to its acquisition or use.

Classification

For the purpose of initial recognition, the Company classifies its financial assets in following categories:

â¢ Financial assets measured at amortised cost;

^â¢ Financial assets measured at fair value through other comprehensive income (FVTOCI); and

â¢ Financial assets measured at fair value through profit and loss (FVTPL)

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

A financial asset being âdebt instrumentâ is measured at the amortised cost if both of the following conditions are met:

â¢ The financial asset is held within a business model whose objective is to hold assets for collecting contractual cash flows, and

â¢ The contractual terms of the financial asset give rise on specified dates to cash flows that are Solely Payments of Principal and Interest (SPPI) on the principal amount outstanding.

A financial asset being âdebt instrumentâ is measured at the FVTOCI if both of the following criteria are met:

â¢ The asset is held within the business model, whose objective is achieved both by collecting contractual cash flows and selling the financial assets, and

â¢ The contractual terms of the financial asset give rise on specified dates to cash flows that are SPPI on the principal amount outstanding.

A financial asset being equity instrument is measured at FVTPL.

All financial assets not classified as measured at amortised cost or FVTOCI as described above are measured at FVTPL.

Subsequent measurement Financial assets at amortised cost These assets are subsequently measured at amortised cost using the effective interest method. The amortised cost is reduced by impairment losses, if any. Interest income and impairment are recognised in the Statement of profit and loss.

Financial assets at FVTPL These assets are subsequently measured at fair value. Net gains and losses, including any interest income, are recognised in the Statement of profit and loss.

Derecognition

The Company derecognises a financial asset when the contractual rights to the cash flows from the financial asset expire, or it transfers the rights to receive the contractual cash flows in a transaction in which substantially all of the risks and rewards of ownership of the financial asset are transferred or in which the Company neither transfers nor retains substantially all of the risks and rewards of ownership and it does not retain control of the financial asset. Any gain or loss on derecognition is recognised in the Statement of profit and loss.

impairment of financial assets (other than at fair value)

The Company recognises loss allowances using the Expected Credit Loss (ECL)

model for the financial assets which are not fair valued through profit and loss. Loss allowance for trade receivables with no significant financing component is measured at an amount equal to lifetime ECL. For all other financial assets, expected credit losses are measured at an amount equal to the 12-month ECL, unless there has been a significant increase in credit risk from initial recognition, in which case those financial assets are measured at lifetime ECL. The changes (incremental or reversal) in loss allowance computed using ECL model, are recognised as an impairment gain or loss in the Statement of profit and loss.

Write-off

The gross carrying amount of a financial asset is written off (either partially or in full) to the extent that there is no realistic prospect of recovery. This is generally the case when the Company determines that the counterparty does not have assets or sources of income that could generate sufficient cash flows to repay the amounts subject to write-off. However, financial assets that are written off could still be subject to enforcement activities in order to comply with the Companyâs procedures for recovery of amounts due.

Financial liabilities

Recognition and initial measurement All financial liabilities are initially recognised when the Company becomes a party to the contractual provisions of the instrument. All financial liabilities are initially measured at fair value minus, for an item not at fair value through profit and loss, transaction costs that are attributable to the liability.

Classification and subsequent measurement Financial liabilities are classified as measured at amortised cost or FVTPL.

A financial liability is classified as FVTPL if it is classified as held-for-trading, or it is a derivative or it is designated as such on initial recognition. Financial liabilities at FVTPL are measured at fair value and net gains and losses, including any interest

Financial liabilities other than classified as FVTPL, are subsequently measured at amortised cost using the effective interest method. Interest expense are recognised in Statement of profit and loss. Any gain or loss on derecognition is also recognised in the Statement of profit and loss.

Compound financial instruments Compound financial instruments are bifurcated into liability and equity

components based on the terms

of the contract.

The liability component of compound financial instruments is initially recognised at the fair value of a similar liability that does not have an equity conversion option. The equity component is initially recognised at the difference between the fair value of the compound financial instrument as a whole and the fair value of the liability component. Any directly attributable transaction costs are allocated to the liability and equity components in proportion to their initial carrying amounts.

Subsequent to the initial recognition, the liability component of the compound financial instrument is measured at amortised cost using the effective interest method. The equity component of the compound financial instrument is not measured subsequently.

Interest on liability component is recognised in Statement of profit and loss. On conversion, the liability component is reclassified to equity and no gain or loss is recognised.

Derecognition

The Company derecognises a financial liability when its contractual obligations are discharged or cancelled or expired.

The Company also derecognises a financial liability when its terms are modified and the cash flows under the modified terms are substantially different. In this case, a new

financial liability based on modified terms is recognised at fair value. The difference between the carrying amount of the financial liability extinguished and the new financial liability with modified terms is recognised in the Statement of profit and loss.

Offsetting of financial instruments Financial assets and financial liabilities are offset, and the net amount presented in the Balance Sheet when, and only when, the Company currently has a legally enforceable right to set off the amounts and it intends either to settle them on a net basis or to realise the assets and settle the liabilities simultaneously.

Derivative financial instruments The Company holds derivative financial instruments to hedge its interest rate risk exposures. Such derivative financial instruments are initially recognised at fair value. Subsequent to initial recognition, derivatives are measured at fair value, and changes therein are recognised in Statement of profit and loss.

(l) Investments

The Company has measured its investment in subsidiaries at cost in its financial statements in accordance with Ind AS 27, Separate Financial Statements.

The Company has measured its investment in bonds at amortised cost in its financial statements.

The Company has measured its investment in mutual fund at FVTPL in its financial statements. Profit or loss on fair value of mutual fund is recognised in statement of profit and loss.

(m) Earnings per share

The Company presents basic and diluted earnings per share (EPS) data for its equity shares. Basic EPS is calculated by dividing the Statement of profit and loss attributable to equity shareholders of the Company by the weighted average number of equity shares outstanding during the year. Diluted EPS is determined

by adjusting Statement of profit and loss attributable to equity shareholders and the weighted average number of equity shares outstanding, for the effects of all dilutive potential equity shares, which comprise share options granted to employees.

The number of equity shares and potentially dilutive equity shares are adjusted retrospectively for all periods presented for any share splits and bonus shares issues including for changes effected prior to the approval of the standalone financial statements by the Board of Directors.

(n) Current and non-current classification

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

Assets

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

it is expected to be realised in, or is intended for sale or consumption in, the Companyâs normal operating cycle;

â¢ it is held primarily for the purpose of being traded;

â¢ it is expected to be realised within 12 months after the reporting date; or

â¢ it is cash or cash equivalent unless it is restricted from being exchanged or used to settle a liability for at least 12 months after the reporting period.

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

Liabilities

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

â¢ it is expected to be settled in the Companyâs normal operating cycle;

â¢ it is held primarily for the purpose of being traded;

â¢ it is due to be settled within 12 months after the reporting period; or

â¢ the Company does not have an unconditional right to defer settlement of the liability for at least 12 months after the reporting period. Terms of a liability that could, at the option of the counterparty, result in its settlement by the issue of equity instruments do not affect its classification.

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

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

Operating cycle

The operating cycle is the time between the acquisition of assets for processing and their realisation in cash or cash equivalents. Based on the nature of operations and the time between the acquisition of assets for processing and their realisation in cash and cash equivalents, the Company has ascertained its operating cycle being a period of 12 months for the purpose of classification of assets and liabilities as current and non- current.

(o) Cash and cash equivalents

Cash and cash equivalents comprises of cash at banks and on hand, cheques on hand and short-term deposits with an original maturity of three months or less, which are subject to an insignificant risk of changes in value.

(p) Segment reporting

The Companyâs business activity primarily falls within a single segment which is providing innovative solutions to help clients in the hospitality and travel industry to achieve their business goals. The geographical segments considered are "within Indiaâ and "outside Indiaâ and are reported in a manner consistent with the internal reporting provided to the Chief Operating Decision Maker ("CODMâ) of the Company who monitors the operating results of its business units not separately for the purpose of making decisions about resource allocation and performance assessment. The CODM is considered to be the Board of Directors who make strategic decisions and is responsible for allocating resources and assessing the financial performance of the operating segments. The analysis of geographical segments is based on geographical location of the customers.

(q) Functional and presentation currency

The management has determined the currency of the primary economic environment in which the Company operates, i.e., the functional currency, to be Indian Rupees (INR). The standalone financial statements are presented in Indian Rupees, which is the Companyâs functional and presentation currency. All amounts have been rounded to the nearest lakhs up to two decimal places, unless otherwise stated. Consequent to rounding off, the numbers presented throughout the document may not add up precisely to the totals and percentages may not precisely reflect the absolute amounts.

(r) Exceptional items

Exceptional items are transactions which due to their size or incidence are separately disclosed to enable a full understanding of the Companyâs financial performance.

(s) Cash flow statement

Cash flows are reported using indirect method, whereby profit before tax is adjusted for the effects transactions of a non-cash nature and any deferrals or accruals of past or future cash receipts or payments. The cash flows from regular revenue generating, financing and investing activities of the Company are segregated. Cash and cash equivalents in the cash flow comprise cash at bank, cash/cheques in hand and short-term investments with an original maturity of three months or less.

(t) Share issue expense

Share issue expenses are adjusted against the Securities Premium Account as permissible under Section 52 of the Companies Act, 2013, to the extent any balance is available for utilisation in the Securities Premium Account. Share issue expenses in excess of the balance in the Securities Premium Account is expensed in the Statement of profit and loss.

(u) Recent accounting pronouncements

Ministry of Corporate Affairs (âMCAâ) notifies new standard or amendments to the existing standards under Companies (Indian Accounting Standards) Rules as issued from time to time. On 31 March 2023, MCA amended the (Indian Accounting Standards) Amendment Rules, 2023, applicable from 01 April 2023, as below:

â¢ 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 01 April 2023. The Company does not expect the amendment

to have any significant impact in its financial statements

â¢ Ind AS 8 - Accounting Policies, Changes in Accounting Estimates and Errors This amendment has introduced a definition of âaccounting estimatesâ 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 01 April 2023. The Company does not expect the amendment to have any significant impact in its financial statements

â¢ 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 01 April 2023. The Company does not expect the amendment to have any significant impact in its financial statements.

Disclaimer: This is 3rd Party content/feed, viewers are requested to use their discretion and conduct proper diligence before investing, GoodReturns does not take any liability on the genuineness and correctness of the information in this article