Notes to Accounts of Securekloud Technologies Ltd.

Mar 31, 2025

2.15 Provisions and contingencies

Provisions are recognized when the Company has a present obligation (legal/ constructive) as a result of 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. When a provision is measured using the cash flows estimated to settle the present obligation, its
carrying amount is the present value of those cash flows (when the effect of the time value of money is material).

When some or all of the economic benefits required to settle a provision are expected to be recovered from a third
party, a receivable is recognised as an asset if it is virtually certain that reimbursement will be received and the amount
of receivable can be measured reliably.

Contingent Liability:

Contingent liability is disclosed for (i) Possible obligations which will be confirmed only by future events not wholly within
the control of the Company or (ii) Present obligations arising from past events where it is not probable that an outflow of
resources will be required to settle the obligation or a reliable estimate of the amount of the obligation cannot be made.

Contingent assets are not recognized in the standalone financial statements since this may result in the recognition of
income that may never be realized’.’

2.16 Segment reporting

Operating segments reflect the Company’s management structure and the way the financial information is regularly
reviewed by the Company’s senior management. The Company considers the business from both business and
product perspective based on the dominant source, nature of risks and returns and the internal organisation and
management structure. The operating segments are the segments for which separate financial information is available
and for which operating profit / (loss) amounts are evaluated regularly by the senior management in deciding how to
allocate resources and in assessing performance.

The accounting policies adopted for segment reporting are in line with the accounting policies of the Company. Segment
revenue, segment expenses, segment assets and segment liabilities have been identified to segments on the basis of their
relationship to the operating activities of the segment.

Inter-segment revenue, where applicable, is accounted on the basis of transactions which are primarily determined
based on market / fair value factors. Revenue, expenses, assets and liabilities which relate to the Company as a whole
and are not allocable to segments on reasonable basis have been included under “unallocated revenue / expenses /
assets / liabilities"

2.17 Goods and services tax input credit

Goods and services tax input credit is accounted for in the books during the period when the underlying service
received is accounted and when there is no uncertainty in availing / utilizing the credits.

2.18 Insurance claims

Insurance claims are accrued for on the basis of claims admitted / expected to be admitted and to the extent there is
no uncertainty in receiving the claims.

2.19 Borrowing costs

Borrowing costs directly attributable to the acquisition, construction or production of an asset that necessarily takes
a substantial period of time to get ready for its intended use or sale are capitalised as part of the cost of the asset. All
other borrowing costs are expensed in the period in which they occur. Borrowing costs consist of interest and other
costs that an entity incurs in connection with the borrowing of funds.

Interest income earned on the temporary investment of specific borrowings pending their expenditure on qualifying
assets is deducted from the borrowing costs eligible for capitalization.

2.20 Operating cycle

Based on the nature of products / activities of the Company and the normal time between acquisition of assets and their
realisation in cash or cash equivalents, the Company has determined its operating cycle as 12 months for the purpose of
classification of its assets and liabilities as current and non-current.

3 Critical accounting judgements and key sources of estimation uncertainty

In the application of the Company’s accounting policies, which are described in note 2, the directors of the Company
are 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 revision affects both current and future periods.

The following are the significant areas of estimation, uncertainty and critical judgements in applying accounting
policies:

• Useful lives of Property, plant and equipment and intangible assets

• Evaluation of Impairment indicators and assessment of recoverable value

• Provision for taxation

• Provision for disputed matters

• Provision for employee benefits

• Allowance for Expected Credit Loss

• Fair Valuation of Financial assets and liabilities

• Leases

Determination of functional and presentation currency:

Items included in the standalone financial statements of the Company are measured using the currency of the primary
economic environment in which the Company operates (i.e. the “functional currency"). The standalone financial
statements are presented in Indian Rupees (INR), the national currency of India, which is the functional currency of the
Company. All the financial information have been presented in Indian Rupees except for share data and as otherwise
stated.

10.1 The above includes amount receivable from related parties amounting to INR 4,570.12 lakhs as at March 31, 2025 and
INR 3,291.76 lakhs as at March 31, 2024. (refer note 36)

10.2 Credit period and risk

All trade receivables are non-interest bearing and are generally on credit terms upto 90 days.

10.3 Expected credit loss allowance

The Company has used a practical expedience by computing the expected loss allowance for trade receivables based
on provision matrix. The provision matrix takes into account the historical credit loss experience and adjustments for
forward looking estimates. At every reporting date, the historical observed default rates are updated and changes in the
forward looking estimates are analysed.

The Company has not made any provisions as per the expected credit loss model prescribed by the requirements of
Ind AS 109. This is largely owing to the fact that majority of the receivables are from group companies. Accordingly, the
Company does not have any history of credit losses and hence there being no credit risk, no allowance has been made.

(a) Securities Premium

Securities premium is used to record the premium on issue of shares. The reserve can be utilised only for limited purposes
such as issuance of bonus shares in accordance with the provisions of the Companies Act, 2013.

(b) General Reserve

Under the erstwhile Companies Act 1956, general reserve was created through an annual transfer of net income at a
specified percentage in accordance with applicable regulations. The purpose of these transfers was to ensure that
if a dividend distribution in a given year is more than 10% of the paid-up capital of the Company for that year, then
the total dividend distribution is less than the total distributable results for that year. Consequent to introduction of
Companies Act 2013, the requirement to mandatorily transfer a specified percentage of the net profit to general
reserve has been withdrawn. However, the amount previously transferred to the general reserve can be utilised only
in accordance with the specific requirements of Companies Act, 2013.

(c) Retained Earnings

Retained earnings are the profits/(loss) that the Company has earned/incurred till date, less any transfers to general reserve,
dividends or other distributions paid to shareholders.

(d) Money Received against Warrant convertible to equity shares

Ind AS 33 - Earnings per Share defines “Warrants” as “ Financial Instruments which give the holder the right to acquire
equity shares’.’ Thus effectively, warrants are the amount which would ultimately form part of the Shareholders’ funds.
Since, shares are yet to be allotted against the same, these are not reflected as part of Share Capital but as a separate line
item - ‘Money received against share warrants’

(e) Capital Reserve

The Company allotted 45,00,000 (Forty five Lakhs) convertible warrants of INR 100/- each to Mr Suresh Venkatachari,
Promoter and CEO of the Company on March 17, 2021 on receipt of an upfront payment INR 11,25,00,000/- (Rupees
Eleven Crores Twenty-Five Lakhs Only) equal to 25% of the total consideration as per the terms of preferential issue in
compliance with Chapter V of SEBI (Issue of Capital & Disclosure Requirements) Regulations, 2018 and Section 42 & 62
of the Companies Act, 2013 and rules made thereunder as amended from time to time. The Company has considered
equivalent shares of 45,00,000 (Forty five Lakhs) for the purpose of diluted EPS up to the period ended June 30, 2022
and 28,93,000 shares (Twenty eight lakhs ninety three thousand) for the period ended December 31, 2022 as per IND AS
33. During the nine months ended December 31, 2022, the Company has allotted 12,25,000 equity shares to Mr Suresh
Venkatachari, as partial conversion of warrants and had 16,07000 convertible warrants outstanding as at September 16,
2022. As the outstanding warrants were not exercised on or before the September 16, 2022, the Company had forfeited
the money received against such warrants amounting to INR 4,01,75,000 and credited the capital reserve in accordance
to the provisions of the Companies Act 2013.

16.2 Notes:

i. The details of Security provided against the Term Loans and loans repayable on demand are as follows:

a. The existing Term Loan facility of INR 758 lakhs and Open Cash Credit (OCC) of INR 1,500 lakhs. These loans are secured
against Hypothecation of book debts (Accounts receivable), fixed assets and personal guarantee of the CEO Mr. Suresh
Venkatachari.

b. The loan is also further secured by pledge of 16,50,000 shares of SecureKloud Technologies Limited held by CEO Mr. Suresh
Venkatachari.

II. As at March 31,2025, the Company has unsecured loan of INR 3,13761 lakhs from R.S. Ramani, Promoter. These borrowings carry
an interest rate of 8% per annum. The Company has obtained a declaration from the Directors that the loan has not been given
out of funds borrowed or deposits accepted from others.

Risk exposures Provision of a defined benefit scheme poses certain risks, some of which are detailed hereunder, as company
take on uncertain long term obligations to make future benefit payments

Interest rate risk: The plan exposes the Company to the risk of fall in interest rates. A fall in interest rates will result in an increase
in the ultimate cost of providing the above benefit and will thus result in an increase in the value of the liability (as shown in
standalone financial statements).

B) Salary escalation risk: The present value of the defined benefit plan is calculated with the assumption of salary increase rate
of plan participants in future. Deviation in the rate of increase of salary in future for plan participants from the rate of increase in
salary used to determine the present value of obligation will have a bearing on the plan’s liability.

C) Demographic risk: The Company has used certain mortality and attrition assumptions in valuation of the liability. The
Company is exposed to the risk of actual experience turning out to be worse compared to the assumption.

D) Liquidity risk: This is the risk that the Company is not able to meet the short-term gratuity payouts. This may arise due to non
availability of enough cash and cash equivalent to meet the liabilities or holding of illiquid assets not being sold in time.

The following tables summarises the components of net benefit expense recognised in the statement of profit and loss, the
obligation amount recognised in the balance sheet towards the gratuity plan.

The sensitivity analysis presented above may not be representative of the actual change in the defined benefit obligations as it is unlikely
that the change in assumptions would occur in isolation of one another as some of the assumptions may be correlated.

Furthermore, in presenting the above sensitivity analysis the present value of defined benefit obligation has been calculated using the
projected unit credit method at the end of the reporting period which is the same as that applied in calculating the defined benefit
obligation liability recognised in the balance sheet. There is no change in the methods and assumptions used in preparing the sensitivity
analysis from the prior years.

(b) Long term compensated absences

The Company’s obligation towards long term compensated absences is unfunded. Liabilities related to the compensated
absences are determined and accrued by actuarial valuation using projected unit credit method by an independent actuary as
at the balance sheet date. The assumptions used for valuation are as follows:

32 Capital Management

For the purpose of the Company’s capital management, capital includes issued equity capital, share premium and all other
equity reserves attributable to the equity holders of the Company.

The Company’s capital management is intended to maximise the return to shareholders for meeting the long term and short¬
term goals of the Company through the optimization of the debt and equity balance. The Company determines the amount of
capital required on the basis of annual and long-term operating plans and strategic investment plans. The funding requirements
are met through equity and long-term/short-term borrowings. The Company ensures that it will be able to continue as a going
concern while maximising its returns to its shareholders by managing its capital by optimisation of the debt and equity balance.
The Company monitors the capital structure on the basis of net debt to equity ratio and maturity profile of the overall debt
portfolio of the Company.

33 Fair value measurement

The fair value of the financial assets and labilities is included at the amount at which the instrument could be exchanged in
a current transaction between willing parties, other than in a forced or liquidation sale. The management assessed that the
cash and cash equivalents, trade receivables, trade payables, bank overdrafts and other payables approximate their carrying
amounts largely due to the short-term maturities of these instruments.

34. Financial risk management objectives and policies

The Company’s principal financial liabilities, comprise term loans, bank overdraft and trade and other payables. The main
purpose of these financial liabilities is to raise finance for the Company’s operations. The Company has various financial assets
such as trade receivables and other receivables, security deposits, investments and cash and bank balances, which arise directly
from its operations.

The Company is exposed to market risk (including currency, interest rate and other market related risks), credit risk and liquidity
risk. The Company’s senior management oversees the management of these risks. The Company’s primary risk management
focus is to minimize potential adverse effects of these financial risks on its financial performance. The Company’s risk
management assessment and policies and processes are established to identify and analyse the risks faced by the Company, to
set appropriate risk limits and controls, and to monitor risks and compliance with the same. Risk assessment and management
policies and processes are reviewed regularly to reflect changes in market conditions and the Company’s activities. The Board
of Directors oversees and reviews the management of each of these risks, which are summarised below.

(a) Liquidity Risk Management

Liquidity risk is the risk that the Company will not be able to meet its financial obligations as they become due. The Company
manages its liquidity risk by ensuring, as far as possible, that it will always have sufficient liquidity to meet its liabilities when due,
under both normal and stressed conditions, without incurring unacceptable losses or risk to the Company’s reputation. The
Company believes that the working capital and its cash and cash equivalent are sufficient to meet its short and medium term
requirements.

The following tables detail the Company’s remaining contractual maturity for its financial liabilities with agreed repayment
periods.The contractual maturity is based on the earliest date on which the Company may be required to pay.

(b) Credit Risk

Credit risk is the risk of financial loss to the Company if a customer or counterparty to a financial instrument fails to meet its
contractual obligations and arises principally from the Company’s receivables from customers and from its financing activities,
including deposits with banks and financial institutions, foreign exchange transactions and other financial instruments. Credit risk
is managed through credit approvals, establishing credit limits and continuously monitoring the creditworthiness of customers
to which the Company grants credit terms in the normal course of business.

Trade receivables: The Company’s exposure to credit risk is influenced mainly by the individual characteristics of each customer.
The demographics of the customer, including the default risk of the industry and country in which the customer operates, also
has an influence on credit risk assessment. The Company uses financial information and past experience to evaluate credit
quality of majority of its customers and individual credit limits are defined in accordance with this assessment. Outstanding
receivables and the credit worthiness of its counter parties are periodically monitored and taken up on case-to-case basis.

Credit risk on cash and cash equivalent is limited as the Company generally transacts with banks and financial institutions with
high credit ratings assigned by international and domestic credit rating agencies.

(c) Market Risk

“Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in market prices.
Market risk comprises three types of risk: interest rate risk, currency risk and other price risk, such as equity price risk and commodity risk.

Financial instruments affected by market risk include all market risk-sensitive financial instruments, term loans, short term debts
and trade receivables. The Company is exposed to market risk primarily related to foreign exchange currency risk and interest
rate risk. Thus, the Company’s exposure to market risk is a function of investing and borrowing activities and revenue generating
and operating activities in foreign currencies.

i. Interest Rate Risk

Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest
rates. The Company’s exposure to the risk of changes in market interest rates relates primarily to the Company’s debt obligations with
floating interest rates. Other than overdraft facilities and term loans maintained with Indian Bank, the Company does not have any credit
facilities from any banks or financial institutions with floating interest rates.As a result, changes in interest rates are not likely to substantially
affect its business or results of operations.

ii. Foreign exchange rate risk

Foreign currency risk is the risk that the fair value or future cash flows of an expenses/ income will fluctuate because of change
in foreign exchange rates. The Company’s exposure to the risk of changes in foreign exchange rates relates primarily to the
Company’s operating activities (when revenue or expenses is denominated in a foreign currency) and the Company’s net
investment in foreign subsidiary.

A significant portion of the Company’s revenues is in USD, while a significant portion of its costs are in Indian rupees. As a
result, if the value of the Indian rupee appreciates relative to this foreign currency, the Company’s revenues measured in Indian
rupees may decrease and vice versa. The exchange rate between the Indian rupee and US Dollar has not been subjected to
significant changes in recent periods. The Company has a forex policy in place whose objective is to reduce foreign exchange
risk by maintaining reasonable open exposures within approved parameters depending on the future outlook on currencies. The
Company does not enter into or trade financial instruments including derivative financial instruments for speculative purpose.

Foreign Currency sensitivity analysis

The following table demonstrates the sensitivity to 5% change in USD and AUD exchange rates, with all other variables held
constant. A positive number below indicates an increase in profit / decrease in loss and increase in equity where the INR
strengthens 5% against the relevant currency. For a 5% weakening of the INR against the relevant currency, there would be
a comparable impact on the profit or loss and equity and balance below would be negative.

1. Current ratio:

The current ratio indicates a company’s overall liquidity position. It is widely used by banks in making decisions regarding the advancing
of working capital credit to their clients.

Current Ratio = Current Assets / Current Liabilities

Decrease is due to reduction in trade receivables in the current year. The Company has collected aged dues during the year. As at March
31, 2023, the Company has no oustanding aged more than 180 days.

2. Debt - Equity Ratio

Debt-to-equity ratio compares a Company’s total debt to shareholders equity. Both of these numbers can be found in a Company’s
balance sheet.

Debt - Equity Ratio = Total Debt / Shareholder’s Equity

Decrease in current year is due to reduction in debt. Company has repaid around INR 990.89 lakhs promoter loan and cleared INR 250
lakhs interest outstanding during the year.

3. Debt Service Coverage Ratio

Debt Service coverage ratio is used to analyse the firm’s ability to payoff current interest and instalments.

Debt Service Coverage Ratio = Earnings available for debt service / Debt Service

Increase in current year is due to lower losses made by the company in the current year when compared to previous year.

4. Return on Equity (ROE):

It measures the profitability of equity funds invested in the Company. The ratio reveals how profitability of the equity-holders’ funds have
been utilized by the Company. It also measures the percentage return generated to equity-holders.The ratio is computed as:

ROE = Net Profits after taxes - Preference Dividend (if any) / Average Shareholder’s Equity

Increase in current year is due to lower losses made by the company in the current year when compared to previous year.

5.Inventory Turnover Ratio

This ratio also known as stock turnover establishes the relationship between the cost of goods sold during the period or sales during the
period and average inventory held during the period. It measures the efficiency with which a Company utilizes or manages its inventory.
Inventory Turnover ratio = Cost of goods sold or sales / Average Inventory

The Company is in the business of providing software services and does not have any physical inventories. Hence, inventory turnover ratio
is not applicable to the Company.

6. Trade receivables turnover ratio

It measures the efficiency at which the firm is managing the receivables.

Trade receivables turnover ratio = Net Credit Sales / Avg. Accounts Receivable

The Company has improved the ratio in the current year by collecting all aged dues outstanding more than 180 days.

1 Trade payables turnover ratio

It indicates the number of times sundry creditors have been paid during a period. It is calculated to judge the requirements of cash for
paying sundry creditors. It is calculated by dividing the net credit purchases by average creditors.

Trade payables turnover ratio = Net Credit Purchases / Average Trade Payables

The Company has improved the ratio in the current year by prompt repayment on all dues within time.

8. Net capital turnover ratio

It indicates a company’s effectiveness in using its working capital. The working capital turnover ratio is calculated as follows: net sales
divided by the average amount of working capital during the same period.

Net capital turnover ratio = Net Sales / Working Capital

Negative impact in current year is due to provision made towards statutory penalty which in turn resulted in negative in working capital.

9. Net profit ratio

It measures the relationship between net profit and sales of the business.

Net Profit Ratio = Net Profit / Net Sales

The Company has improved the ratio in the current year due to reduction in loss

10. Return on capital employed (ROCE)

Return on capital employed indicates the ability of a company’s management to generate returns for both the debt holders and the
equity holders. Higher the ratio, more efficiently is the capital being employed by the company to generate returns.

ROCE = Earning before interest and taxes / Capital Employed

Decrease in current year is due to loss incurred by the Company in the current year.

11. Return on investment

Return on investment (ROI) is a financial ratio used to calculate the benefit an investor will receive in relation to their investment cost. The
higher the ratio, the greater the benefit earned.

i) The Company has invested in its overseas subsidairies for business expansion, therby fueling further growth in new geographies.
Hence, return on investment is not applicable for our Company.

ii) The Company do not have any Benami property, where any proceeding has been initiated or pending against the Group for holding
any Benami property under the Benami Transactions (Prohibition) Act, 1988 and rules made thereunder.

iii) The Company do not have any transactions with companies struck off under section 248 of Companies Act, 2013 or section 560 of
Companies Act, 1956.

iv) The Company do not have any charges or satisfaction which is yet to be registered with ROC beyond the statutory period.

v) The Company has not traded or invested in cryptocurrency transactions or virtual currency during the financial year

vi) The Company has not advanced or loaned or invested funds to any other person(s) or entity(ies) including foreign entities
(Intermediaries) with the understanding that the intermediary shall :

a. directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the
company (Ultimate Beneficiaries) or

b. provide any guarantee, security or the like to or on behalf of the Ultimate Beneficiaries.

vii) The Company has not any such transaction which is not recorded in the books of accounts that has been surrendered or disclosed as
income during the year in the tax assessments under the Income Tax Act,1961 (such as,search or survey or any other relevant provisions
of the Income Tax Act, 1961).

Notes:

(i) The Company accounts for costs incurred by / on behalf of the Related Parties based on the actual invoices /
debit notes raised and accruals as confirmed by such related parties. The Related Parties have confirmed to the
Management that as at March 31, 2025 and March 31, 2024, there are no further amounts payable to / receivable
from them, other than as disclosed above. The Company incurs certain costs on behalf of other companies in the
group. These costs have been allocated/recovered from the group companies on a basis mutually agreed to with the
group companies.

(ii) Excludes gratuity and compensated absences which cannot be separately identifiable from the composite amount
advised by the actuary.

(iii) The remuneration payable to key management personnel is determined by the nomination and remuneration
committee having regard to the performance of individuals and market trends.

(iv) The amounts outstanding are unsecured and will be settled in cash. There have been no instances of amounts
due to or due from related parties that have been written back or written off or otherwise provided for during the
year.

v) The Company has provided Corporate Guarantee amounting to USD 5 million to Columbia Bank for loans
taken by SecureKloud Technologies Inc., USA (formerly 8K Miles Software Services Inc., USA), a subsidiary of
the Company.

37 Segment Reporting

The Company is engaged in Information and Technology Services. Based on the management approach as defined in Ind-AS 108 -
Operating Segments, the senior management evaluates the Company’s performance and allocates resources based on an analysis of
various performance indicators by the overall business / operating segment.

As the allocation of resources and profitability of the business is evaluated by the senior management on an overall basis, with evaluation
into individual categories to understand the reasons for variations, no separate segments have been identified. Accordingly, the amounts
appearing in these standalone financial statements relate to this operating segment.

Geographical Information:

The Company has operations within India as well as in other countries. The operations in United States of America constitute a
major part of its operations. Management has reviewed the geographical areas vis-a-vis the risks and returns that encompass
them. While arriving at this, management has reviewed the similarity of the economic and political conditions, relationships
between operations in these geographical areas, proximity of operations, and special risks if any associated with operations in
these areas.

Fixed assets used in the Company’s business have not been identified to any of the reportable segments, as the fixed assets
and services are used interchangeably between segments. The Company believes that it is currently not practicable to provide
segment disclosures relating to assets, liabilities and capital expenditure.

39 Corporate Social Responsibility

As the Company has not met the applicability threshold as prescribed under 135 of the Companies Act, 2013, the need to spend
at least 2% of its average net profit at immediately preceeding three financial years on corporate social responsibility (CSR)
activities does not arise.

40 The previous year figures have been reclassified/ regrouped to conform to the presentation of the current year. These
reclassifications have no effect on the previously reported net loss/profit.

41 Approval of Standalone Financial Statements

In connection with the preparation of the standalone financial statements for the year ended March 31, 2025, the Board of Directors have
confirmed the propriety of the contracts / agreements entered into by / on behalf of the Company and the resultant revenue earned /
expenses incurred arising out of the same after reviewing the levels of authorisation and the available documentary evidences and the
overall control environment. Further, the Board of Directors have also reviewed the realizable value of all the current assets of the Company
and have confirmed that the value of such assets in the ordinary course of business will not be less than the value at which these are
recognised in the standalone financial statements. In addition, the Board has also confirmed the carrying value of the non-current assets in
the standalone financial statements. The Board, duly taking into account all the relevant disclosures made, has approved these standalone
financial statements in its meeting held on May 30, 2025 in accordance with the provisions of Companies Act, 2013.

As per our report of even date.

For ^{K Gopal Rao} & ^Cov For and on behalf of the Board of Directors

Chartered Accountants

FRN:000956S

CA Gopal Krishna Raju Suresh Venkatachari Venkateswaran Kirshnamurthy

Partner Chairman & Whole-time Director

Membership No. 205929 Chief Executive Officer & Chief Revenue Officer

UDIN: 25205929BMLDMT2313 DIN: 00365522 DIN: 10886686

Pl_{ace :} Ch_ennai Ramachandran Soundararajan Jayashree Vasudevan

_{Date: May 30, 2025} Chief Financial Officer ^{Company Secretary}

---

Mar 31, 2024

10.1 The above includes amount receivable from related parties amounting to INR 3291.76 lakhs as at March 31, 2024 and INR 1955.12 lakhs as at March 31, 2023. (refer note 36)

10.2 Credit period and risk

All trade receivables are non-interest bearing and are generally on credit terms upto 90 days.

10.3 Expected credit loss allowance

The Company has used a practical expedient by computing the expected loss allowance for trade receivables based on provision matrix. The provision matrix takes into account the historical credit loss experience and adjustments for forward looking estimates. At every reporting date, the historical observed default rates are updated and changes in the forward looking estimates are analysed.

The Company has not made any provisions as per the expected credit loss model prescribed by the requirements of Ind AS 109. This is largely owing to the fact that majority of the receivables are from group companies. Accordingly, the Company does not have any history of credit losses and hence there being no credit risk, no allowance has been made.

(ii) Terms/rights attached to equity shares

The Company has only one class of equity shares having a par value of INR 5/- per share. Each shareholder is eligible for one vote per share held. The dividend proposed, if any, by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting, except in case of interim dividend. In the event of liquidation, the equity shareholders are eligible to receive the remaining assets of the Company after distribution of all preferential amounts, in proportion to their shareholding.

(iv) The Company allotted 45,00,000 (Forty five Lakhs) convertible warrants of INR 100/- each to Mr Suresh Venkatachari, Promoter and CEO of the Company on March 17, 2021 on receipt of an upfront payment INR 11,25,00,000/- (Rupees Eleven Crores Twenty-Five Lakhs Only) equal to 25% of the total consideration as per the terms of preferential issue in compliance with Chapter V of SEBI (Issue of Capital & Disclosure Requirements) Regulations, 2018 and Section 42 & 62 of the Companies Act, 2013 and rules made thereunder as amended from time to time. The Company has considered equivalent shares of 45,00,000 (Forty five Lakhs) for the purpose of diluted EPS up to the period ended June 30, 2022 and 28,93,000 shares (Twenty eight lakhs ninety three thousand) for the period ended December 31, 2022 as per IND AS 33. During the year ended March 31, 2023, the Company has allotted 12,25,000 equity shares to Mr Suresh Venkatachari, as partial conversion of warrants and had 16,07,000 convertible warrants outstanding as at September 16, 2022. As the outstanding warrants were not exercised on or before the September 16, 2022, the Company had forfeited the money received against such warrants amounting to INR 4,01,75,000 and credited the capital reserve in accordance to the provisions of the Companies Act 2013.

(a) Securities Premium

Securities premium is used to record the premium on issue of shares. The reserve can be utilised only for limited purposes such as issuance of bonus shares in accordance with the provisions of the Companies Act, 2013.

(b) General Reserve

Under the erstwhile Companies Act 1956, general reserve was created through an annual transfer of net income at a specified percentage in accordance with applicable regulations. The purpose of these transfers was to ensure that if a dividend distribution in a given year is more than 10% of the paid-up capital of the Company for that year, then the total dividend distribution is less than the total distributable results for that year. Consequent to introduction of Companies Act 2013, the requirement to mandatorily transfer a specified percentage of the net profit to general reserve has been withdrawn. However, the amount previously transferred to the general reserve can be utilised only in accordance with the specific requirements of Companies Act, 2013.

(c) Retained Earnings

Retained earnings are the profits/(loss) that the Company has earned/incurred till date, less any transfers to general reserve, dividends or other distributions paid to shareholders.

(d) Money Received against Warrant convertible to equity shares

Ind AS 33 - Earnings per Share defines “Warrants” as “ Financial Instruments which give the holder the right to acquire equity shares”. Thus effectively, warrants are the amount which would ultimately form part of the Shareholders’ funds. Since, shares are yet to be allotted against the same, these are not reflected as part of Share Capital but as a separate line item - ‘Money received against share warrants’.

(e) Capital Reserve

The Company allotted 45,00,000 (Forty five Lakhs) convertible warrants of INR 100/- each to Mr Suresh Venkatachari, Promoter and CEO of the Company on March 17, 2021 on receipt of an upfront payment INR 11,25,00,000/- (Rupees Eleven Crores Twenty-Five Lakhs Only) equal to 25% of the total consideration as per the terms of preferential issue in compliance with Chapter V of SEBI (Issue of Capital & Disclosure Requirements) Regulations, 2018 and Section 42 & 62 of the Companies Act, 2013 and rules made thereunder as amended from time to time. The Company has considered equivalent shares of 45,00,000 (Forty five Lakhs) for the purpose of diluted EPS up to the period ended June 30, 2022 and 28,93,000 shares (Twenty eight lakhs ninety three thousand) for the period ended December 31, 2022 as per IND AS 33. During the nine months ended December 31, 2022, the Company has allotted 12,25,000 equity shares to Mr Suresh Venkatachari, as partial conversion of warrants and had 16,07,000 convertible warrants outstanding as at September 16, 2022. As the outstanding warrants were not exercised on or before the September 16, 2022, the Company had forfeited the money received against such warrants amounting to INR 4,01,75,000 and credited the capital reserve in accordance to the provisions of the Companies Act 2013.

16.2 Notes:

i. The details of Security provided against the Term Loans and loans repayable on demand are as follows:

b. The existing Term Loan facility of INR 758 lakhs and Open Cash Credit (OCC) of INR 1,500 lakhs. These loans are secured against Hypothecation of book debts (Accounts receivable), fixed assets and personal guarantee of the CEO.

c. The loan is also further secured by pledge of 16,50,000 shares of SecureKloud Technologies Limited held by CEO Mr. Suresh Venkatachari.

II. As at March 31, 2024, the Company has unsecured loan of INR 3137.61 lakhs ( INR 3137.61 lakhs as at March 31, 2023) from R.S. Ramani, Promoter. These borrowings carry an interest rate of 8% per annum. The Company has obtained a declaration from the Director that the loan has not been given out of funds borrowed or deposits accepted from others.

The Company allotted 45,00,000 (Forty five Lakhs) convertible warrants of INR 100/- each to Mr Suresh Venkatachari, Promoter and CEO of the Company on March 17, 2021 on receipt of an upfront payment INR 11,25,00,000/- (Rupees Eleven Crores Twenty-Five Lakhs Only) equal to 25% of the total consideration as per the terms of preferential issue in compliance with Chapter V of SEBI (Issue of Capital & Disclosure Requirements) Regulations, 2018 and Section 42 & 62 of the Companies Act, 2013 and rules made thereunder as amended from time to time. The Company has considered equivalent shares of 45,00,000 (Forty five Lakhs) for the purpose of diluted EPS up to the period ended June 30, 2022 and 28,93,000 shares (Twenty eight lakhs ninety three thousand) for the period ended December 31, 2022 as per IND AS 33.During the nine months ended December 31, 2022, the Company has allotted 12,25,000 equity shares to Mr Suresh Venkatachari, as partial conversion of warrants and had 16,07,000 convertible warrants outstanding as at September 16, 2022. As the outstanding warrants were not exercised on or before the September 16, 2022, the Company had forfeited the money received against such warrants amounting to INR 4,01,75,000.

29 Lease Commitments

The Company has taken vehicle and office building on lease for a period of 4 years.

The Company was in receipt of a SEBI adjudication order on September 14, 2022 alleging violation under SEBI (LODR) Regulations, 2015 and was imposed a penalty of INR 25 lakhs. Consequently, the Company filed an appeal before Hon’ble Securities Appellate Tribunal and is awaiting further directives. The penalty amount of INR 25 lakhs had been provided on a prudent basis during the year ended March 31, 2023. The final order in the said matter was passed by the Hon’ble SAT on July 12, 2023, wherein the penalty was reduced to INR 10 lakhs and accordingly the excess provision was reversed during the current financial year.

The Company received final order from SEBI on December 16, 2022 on the alleged financial irregularities reported by the Company’s statutory auditor, viz. Deloitte Haskins and Sells in their audit report for FY 2018-19. SEBI’s final order gave certain directives and has imposed penalty of INR 400 lakhs on the Company. The Company has filed an appeal before Hon’ble Securities Appellate Tribunal and is awaiting further directives. The penalty amount of INR 400 lakhs has been provided for on a prudent basis during the year ended March 31, 2023.

31 Employee benefits

(I) Defined contribution plan

During the year, the Company has recognised INR 80.25 lakhs (March 31, 2023 - INR 124.17 lakhs) as contribution to provident fund and other funds in the Statement of Profit and Loss (included in Contribution to Provident and other funds in Note 24).

(II) Defined benefit plans:

(A) Gratuity plan

The Company has a defined benefit gratuity plan. Every employee who has completed five years or more of service gets gratuity on departure at 15 days salary (last drawn salary) for each completed year of service subject to a maximum of INR 20 lakhs. In case of death while in service, the gratuity is payable irrespective of vesting. The Company’s obligation towards its gratuity liability is unfunded. Liabilities related to the gratuity plan are determined and accrued by actuarial valuation using projected unit credit method by an independent actuary as at the balance sheet date.

Risk exposures

Provision of a defined benefit scheme poses certain risks, some of which are detailed hereunder, as company take on uncertain long term obligations to make future benefit payments

Interest rate risk: The plan exposes the Company to the risk of fall in interest rates. A fall in interest rates will result in an increase in the ultimate cost of providing the above benefit and will thus result in an increase in the value of the liability (as shown in standalone financial statements).

B) Salary escalation risk: The present value of the defined benefit plan is calculated with the assumption of salary increase rate of plan participants in future. Deviation in the rate of increase of salary in future for plan participants from the rate of increase in salary used to determine the present value of obligation will have a bearing on the plan’s liability.

C) Demographic risk: The Company has used certain mortality and attrition assumptions in valuation of the liability. The Company is exposed to the risk of actual experience turning out to be worse compared to the assumption.

D) Liquidity risk: This is the risk that the Company is not able to meet the short-term gratuity payouts. This may arise due to non availability of enough cash and cash equivalent to meet the liabilities or holding of illiquid assets not being sold in time.

The following tables summarises the components of net benefit expense recognised in the statement of profit and loss, the obligation amount recognised in the balance sheet towards the gratuity plan.

The estimates of future salary increases, considered in actuarial valuation, take account of inflation, seniority, promotion and other relevant factors, such as supply and demand in the employment market.

The sensitivity analysis below has been determined based on a method that extrapolates the impact on defined benefit obligation as a result of reasonable changes in key assumptions occurring at the end of the reporting period.

The sensitivity analysis presented above may not be representative of the actual change in the defined benefit obligations as it is unlikely that the change in assumptions would occur in isolation of one another as some of the assumptions may be correlated.

Furthermore, in presenting the above sensitivity analysis the present value of defined benefit obligation has been calculated using the projected unit credit method at the end of the reporting period which is the same as that applied in calculating the defined benefit obligation liability recognised in the balance sheet. There is no change in the methods and assumptions used in preparing the sensitivity analysis from the prior years.

(b) Long term compensated absences

The Company’s obligation towards long term compensated absences is unfunded. Liabilities related to the compensated absences are determined and accrued by actuarial valuation using projected unit credit method by an independent actuary as at the balance sheet date. The assumptions used for valuation are as follows:

32 Capital Management

For the purpose of the Company’s capital management, capital includes issued equity capital, share premium and all other equity reserves attributable to the equity holders of the Company.

The Company’s capital management is intended to maximise the return to shareholders for meeting the long term and shortterm goals of the Company through the optimization of the debt and equity balance. The Company determines the amount of capital required on the basis of annual and long-term operating plans and strategic investment plans. The funding requirements are met through equity and long-term/short-term borrowings. The Company ensures that it will be able to continue as a going concern while maximising its returns to its shareholders by managing its capital by optimisation of the debt and equity balance. The Company monitors the capital structure on the basis of net debt to equity ratio and maturity profile of the overall debt portfolio of the Company. (T in Lakhs)

33 Fair value measurement

The fair value of the financial assets and labilities is included at the amount at which the instrument could be exchanged in a current transaction between willing parties, other than in a forced or liquidation sale. The management assessed that the cash and cash equivalents, trade receivables, trade payables, bank overdrafts and other payables approximate their carrying amounts largely due to the short-term maturities of these instruments.

34. Financial risk management objectives and policies

The Company’s principal financial liabilities, comprise term loans, bank overdraft and trade and other payables. The main purpose of these financial liabilities is to raise finance for the Company’s operations. The Company has various financial assets such as trade receivables and other receivables, security deposits, investments and cash and bank balances, which arise directly from its operations.

The Company is exposed to market risk (including currency, interest rate and other market related risks), credit risk and liquidity risk. The Company’s senior management oversees the management of these risks. The Company’s primary risk management focus is to minimize potential adverse effects of these financial risks on its financial performance. The Company’s risk management assessment and policies and processes are established to identify and analyse the risks faced by the Company, to set appropriate risk limits and controls, and to monitor risks and compliance with the same. Risk assessment and management policies and processes are reviewed regularly to reflect changes in market conditions and the Company’s activities. The Board of Directors oversees and reviews the management of each of these risks, which are summarised below.

(a) Liquidity Risk Management

Liquidity risk is the risk that the Company will not be able to meet its financial obligations as they become due. The Company manages its liquidity risk by ensuring, as far as possible, that it will always have sufficient liquidity to meet its liabilities when due, under both normal and stressed conditions, without incurring unacceptable losses or risk to the Company’s reputation. The Company believes that the working capital and its cash and cash equivalent are sufficient to meet its short and medium term requirements.

The following tables detail the Company’s remaining contractual maturity for its financial liabilities with agreed repayment periods. The contractual maturity is based on the earliest date on which the Company may be required to pay.

(b) Credit Risk

Credit risk is the risk of financial loss to the Company if a customer or counterparty to a financial instrument fails to meet its contractual obligations and arises principally from the Company’s receivables from customers and from its financing activities, including deposits with banks and financial institutions, foreign exchange transactions and other financial instruments. Credit risk is managed through credit approvals, establishing credit limits and continuously monitoring the creditworthiness of customers to which the Company grants credit terms in the normal course of business.

Trade receivables: The Company’s exposure to credit risk is influenced mainly by the individual characteristics of each customer. The demographics of the customer, including the default risk of the industry and country in which the customer operates, also has an influence on credit risk assessment. The Company uses financial information and past experience to evaluate credit quality of majority of its customers and individual credit limits are defined in accordance with this assessment. Outstanding receivables and the credit worthiness of its counter parties are periodically monitored and taken up on case-to-case basis.

Credit risk on cash and cash equivalent is limited as the Company generally transacts with banks and financial institutions with high credit ratings assigned by international and domestic credit rating agencies.

(c) Market Risk

“Market risk is the risk that the fairvalue offuture cash flows of a financial instrument will fluctuate because of changes in market prices. Marketriskcomprises three types of risk: interestraterisk, currencyriskand otherpricerisk, such as equitypriceriskand commodityrisk.

Financial instruments affected by market risk include all market risk-sensitive financial instruments, term loans, short term debts and trade receivables. The Company is exposed to market risk primarily related to foreign exchange currency risk and interest rate risk. Thus, the Company’s exposure to market risk is a function of investing and borrowing activities and revenue generating and operating activities in foreign currencies.

i. Interest Rate Risk

Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. The Company’s exposure to the risk of changes in market interest rates relates primarily to the Company’s debt obligations with floating interest rates. Other than overdraft facilities and term loans maintained with Indian Bank, the Company do not have any credit facilities from any banks or financial institutions with floating interest rates. As a result, changes in interest rates are not likely to substantially affect its business or results of operations.

ii. Foreign exchange rate risk

Foreign currency risk is the risk that the fair value or future cash flows of an expenses/ income will fluctuate because of change in foreign exchange rates. The Company’s exposure to the risk of changes in foreign exchange rates relates primarily to the Company’s operating activities (when revenue or expenses is denominated in a foreign currency) and the Company’s net investment in foreign subsidiary.

A significant portion of the Company’s revenues is in USD, while a significant portion of its costs are in Indian rupees. As a result, if the value of the Indian rupee appreciates relative to this foreign currency, the Company’s revenues measured in Indian rupees may decrease and vice versa. The exchange rate between the Indian rupee and US Dollar has not been subjected to significant changes in recent periods. The Company has a forex policy in place whose objective is to reduce foreign exchange risk by maintaining reasonable open exposures within approved parameters depending on the future outlook on currencies. The Company does not enter into or trade financial instruments including derivative financial instruments for speculative purpose.

The carrying amounts of the Company’s foreign currency denominated monetary assets and monetary liabilities at the end of each reporting period are as follows :

Out of the above foreign currency exposures, none of the monetary assets and liabilities are hedged by derivative instruments or otherwise.

Foreign Currency sensitivity analysis

The following table demonstrates the sensitivity to 5% change in USD and AUD exchange rates, with all other variables held constant. A positive number below indicates an increase in profit / decrease in loss and increase in equity where the INR strengthens 5% against the relevant currency. For a 5% weakening of the INR against the relevant currency, there would be a comparable impact on the profit or loss and equity and balance below would be negative.

1. Current ratio:

The current ratio indicates a company’s overall liquidity position. It is widely used by banks in making decisions regarding the advancing of working capital credit to their clients.

Current Ratio = Current Assets / Current Liabilities

Increase in current ration is due to more funds lockedup in Receivable from USA.

2. Debt - Equity Ratio

Debt-to-equity ratio compares a Company’s total debt to shareholders equity. Both of these numbers can be found in a Company’s balance sheet.

Debt - Equity Ratio = Total Debt / Shareholder’s Equity

Decrease in current year is due to reduction in Shareholder’s equity on account of loss

3. Debt Service Coverage Ratio

Debt Service coverage ratio is used to analyse the firm’s ability to payoff current interest and instalments.

Debt Service Coverage Ratio = Earnings available for debt service / Debt Service

Increase in current year is due to low repayment of principal loans

4. Return on Equity (ROE):

It measures the profitability of equity funds invested in the Company. The ratio reveals how profitability of the equity-holders’ funds have been utilized by the Company. It also measures the percentage return generated to equity-holders. The ratio is computed as:

ROE = Net Profits after taxes - Preference Dividend (if any) / Average Shareholder’s Equity Decrease in current year is due to exceptional items of cost (Impariement on Investments)

5.Inventory Turnover Ratio

This ratio also known as stock turnover establishes the relationship between the cost of goods sold during the period or sales during the period and average inventory held during the period. It measures the efficiency with which a Company utilizes or manages its inventory.

Inventory Turnover ratio = Cost of goods sold or sales / Average Inventory

The Company is in the business of providing software services and does not have any physical inventories. Hence, inventory turnover ratio is not applicable to the Company.

6. Trade receivables turnover ratio

It measures the efficiency at which the firm is managing the receivables.

Trade receivables turnover ratio = Net Credit Sales / Avg. Accounts Receivable The decrease is due to funds lockedup in the Receivables from USA

7. Trade payables turnover ratio

It indicates the number of times sundry creditors have been paid during a period. It is calculated to judge the requirements of cash for paying sundry creditors. It is calculated by dividing the net credit purchases by average creditors.

Trade payables turnover ratio = Net Credit Purchases / Average Trade Payables The reason of decrease in the ratio is due to there was delay in the payment of dues.

8. Net capital turnover ratio

It indicates a company’s effectiveness in using its working capital. The working capital turnover ratio is calculated as follows: net sales divided by the average amount of working capital during the same period.

Net capital turnover ratio = Net Sales / Working Capital

The variance in the ration is due to minor improvement in the working capital

9. Net profit ratio

It measures the relationship between net profit and sales of the business.

Net Profit Ratio = Net Profit / Net Sales

The reduction in the ratio is due to provisions made for Exception items (Impariment on Investment)

10. Return on capital employed (ROCE)

Return on capital employed indicates the ability of a company’s management to generate returns for both the debt holders and the equity holders. Higher the ratio, more efficiently is the capital being employed by the company to generate returns. ROCE = Earning before interest and taxes / Capital Employed

The reduction in the ratio is due to provisions made for Exception items (Impariment on Investment)

11. Return on investment

Return on investment (ROI) is a financial ratio used to calculate the benefit an investor will receive in relation to their investment cost. The higher the ratio, the greater the benefit earned.

The Company has invested in its overseas subsidairies for business expansion, therby fueling further growth in new geographies. Hence, return on investment is not applicable for our Company.

ii) The Company do not have any Benami property, where any proceeding has been initiated or pending against the Group for holding any Benami property under the Benami Transactions (Prohibition) Act, 1988 and rules made thereunder.

iii) The Company do not have do not have any transactions with companies struck off under section 248 of Companies Act, 2013 or section 560 of Companies Act, 1956.

iv) The Company do not have any charges or satisfaction which is yet to be registered with ROC beyond the statutory period.

v) The Company has not traded or invested in cryptocurrency transactions or virtual currency during the financial year

vi) The Company has not advanced or loaned or invested funds to any other person(s) or entity(ies) including foreign entities (Intermediaries) with the understanding that the intermediary shall :

a. directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the company (Ultimate Beneficiaries) or

b. provide any guarantee, security or the like to or on behalf of the Ultimate Beneficiaries.

vii) The Company has not any such transaction which is not recorded in the books of accounts that has been surrendered or disclosed as income during the year in the tax assessments under the Income Tax Act, 1961 (such as, search or survey or any other relevant provisions of the Income Tax Act, 1961).

(i) The Company accounts for costs incurred by / on behalf of the Related Parties based on the actual invoices

/ debit notes raised and accruals as confirmed by such related parties. The Related Parties have confirmed to the Management that as at March 31, 2024 and March 31, 2023, there are no further amounts payable to / receivable from them, other than as disclosed above. The Company incurs certain costs on behalf of other companies in the group. These costs have been allocated/recovered from the group companies on a basis mutually agreed to with the group companies.

(ii) Excludes gratuity and compensated absences which cannot be separately identifiable from the composite amount advised by the actuary.

(iii) The remuneration payable to key management personnel is determined by the nomination and remuneration committee having regard to the performance of individuals and market trends.

(iv) The amounts outstanding are unsecured and will be settled in cash. There have been no instances of amounts due to or due from related parties that have been written back or written off or otherwise provided for during the year.

(v) The Company has provided Corporate Guarantee amounting to USD 5 million to Columbia Bank for loans taken by SecureKloud Technologies Inc., USA, a subsidiary of the Company.

37 Segment Reporting

The Company is engaged in Information and Technology Services. Based on the management approach as defined in Ind-AS 108 - Operating Segments, the senior management evaluates the Company’s performance and allocates resources based on an analysis of various performance indicators by the overall business / operating segment.

As the allocation of resources and profitability of the business is evaluated by the senior management on an overall basis, with evaluation into individual categories to understand the reasons for variations, no separate segments have been identified. Accordingly, the amounts appearing in these standalone financial statements relate to this operating segment.

Geographical Information:

The Company has operations within India as well as in other countries. The operations in United States of America constitute a major part of its operations. Management has reviewed the geographical areas vis-a-vis the risks and returns that encompass them. While arriving at this, management has reviewed the similarity of the economic and political conditions, relationships between operations in these geographical areas, proximity of operations, and special risks if any associated with operations in these areas.

Fixed assets used in the Company’s business have not been identified to any of the reportable segments, as the fixed assets and services are used interchangeably between segments. The Company believes that it is currently not practicable to provide segment disclosures relating to assets, liabilities and capital expenditure.

Disclosures required under Section 22 of the Micro, Small and Medium Enterprises Development Act, 2006

Based on and to the extent of information received by the Company from the suppliers during the year regarding their status under the Micro, Small and Medium Enterprises Development Act, 2006 (MSMED Act), which has been relied upon by the Auditors, the relevant particulars are furnished below.

Note: Dues to Micro,Small and Medium Enterprises have been determined to the extent such parties have been identified on the basis of information collected by the Management. This has been relied upon by the auditors.

39 Corporate Social Responsibility

As the Company has not met the applicability threshold as prescribed under 135 of the Companies Act, 2013, the need to spend at least 2% of its average net profit at immediately preceeding three financial years on corporate social responsibility (CSR) activities does not arise.

40 The previous year figures have been reclassified/ regrouped to conform to the presentation of the current year. These reclassifications have no effect on the previously reported net loss/profit.

41 Approval of Standalone Financial Statements

In connection with the preparation of the standalone financial statements for the year ended March 31, 2024, the Board of Directors have confirmed the propriety of the contracts / agreements entered into by / on behalf of the Company and the resultant revenue earned / expenses incurred arising out of the same after reviewing the levels of authorisation and the available documentary evidences and the overall control environment. Further, the Board of Directors have also reviewed the realizable value of all the current assets of the Company and have confirmed that the value of such assets in the ordinary course of business will not be less than the value at which these are recognised in the standalone financial statements. In addition, the Board has also confirmed the carrying value of the non-current assets in the standalone financial statements. The Board, duly taking into account all the relevant disclosures made, has approved these standalone financial statements in its meeting held on May 30, 2024 in accordance with the provisions of Companies Act, 2013.

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Mar 31, 2023

2.15 Provisions and contingencies

Provisions are recognized when the Company has a present obligation (legal/ constructive) as a result of 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. When a provision is measured using the cash flows estimated to settle the present obligation, its carrying amount is the present value of those cash flows (when the effect of the time value of money is material).

When some or all of the economic benefits required to settle a provision are expected to be recovered from a third party, a receivable is recognised as an asset if it is virtually certain that reimbursement will be received and the amount of receivable can be measured reliably.

Contingent Liability

Contingent liability is disclosed for (i) Possible obligations which will be confirmed only by future events not wholly within the control of the Company or (ii) Present obligations arising from past events where it is not probable that an outflow of resources will be required to settle the obligation or a reliable estimate of the amount of the obligation cannot be made.

Contingent assets are not recognized in the standalone financial statements since this may result in the recognition of income that may never be realized.

2.16 Segment reporting

Operating segments reflect the Company''s management structure and the way the financial information is regularly reviewed by the Company''s senior management. The Company considers the business from both business and product perspective based on the dominant source, nature of risks and returns and the internal organisation and management structure. The operating segments are the segments for which separate financial information is available and for which operating profit / (loss) amounts are evaluated regularly by the senior management in deciding how to allocate resources and in assessing performance.

The accounting policies adopted for segment reporting are in line with the accounting policies of the Company. Segment revenue, segment expenses, segment assets and segment liabilities have been identified to segments on the basis of their relationship to the operating activities of the segment.

Inter-segment revenue, where applicable, is accounted on the basis of transactions which are primarily determined based on market / fair value factors. Revenue, expenses, assets and liabilities which relate to the Company as a whole and are not allocable to segments on reasonable basis have been included under "unallocated revenue / expenses / assets / liabilities.

2.17 Goods and services tax input credit

Goods and services tax input credit is accounted for in the books during the period when the underlying service received is accounted and when there is no uncertainty in availing / utilizing the credits.

2.18 Insurance claims

Insurance claims are accrued for on the basis of claims admitted / expected to be admitted and to the extent there is no uncertainty in receiving the claims.

2.19 Borrowing costs

Borrowing costs directly attributable to the acquisition, construction or production of an asset that necessarily takes a substantial period of time to get ready for its intended use or sale are capitalised as part of the cost of the asset. All other borrowing costs are expensed in the period in which they occur. Borrowing costs consist of interest and other costs that an entity incurs in connection with the borrowing of funds.

Interest income earned on the temporary investment of specific borrowings pending their expenditure on qualifying assets is deducted from the borrowing costs eligible for capitalization.

2.20 Operating cycle

Based on the nature of products / activities of the Company and the normal time between acquisition of assets and their realisation in cash or cash equivalents, the Company has determined its operating cycle as 12 months for the purpose of classification of its assets and liabilities as current and non-current.

3 Critical accounting judgements and key sources of estimation uncertainty

In the application of the Company''s accounting policies, which are described in note 2, the directors of the Company are 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 revision affects both current and future periods.

The following are the significant areas of estimation, uncertainty and critical judgements in applying accounting policies:

• Useful lives of Property, plant and equipment and intangible assets

• Evaluation of Impairment indicators and assessment of recoverable value

• Provision for taxation

• Provision for disputed matters

• Provision for employee benefits

• Allowance for Expected Credit Loss

• Fair Valuation of Financial assets and liabilities

• Leases

Determination of functional and presentation currency

Items included in the standalone financial statements of the Company are measured using the currency of the primary economic environment in which the Company operates (i.e. the "functional currency"). The standalone financial statements are presented in Indian Rupees (INR), the national currency of India, which is the functional currency of the Company. All the financial information have been presented in Indian Rupees except for share data and as otherwise stated.

(a) Securities premium

Securities premium is used to record the premium on issue of shares. The reserve can be utilised only for limited purposes such as issuance of bonus shares in accordance with the provisions of the Companies Act, 2013.

(b) General reserve

Under the erstwhile Companies Act 1956, general reserve was created through an annual transfer of net income at a specified percentage in accordance with applicable regulations. The purpose of these transfers was to ensure that if a dividend distribution in a given year is more than 10% of the paid-up capital of the Company for that year, then the total dividend distribution is less than the total distributable results for that year. Consequent to introduction of Companies Act 2013, the requirement to mandatorily transfer a specified percentage of the net profit to general reserve has been withdrawn. However, the amount previously transferred to the general reserve can be utilised only in accordance with the specific requirements of Companies Act, 2013.

(c) Retained earnings

Retained earnings are the profits/(loss) that the Company has earned/incurred till date, less any transfers to general reserve, dividends or other distributions paid to shareholders.

(d) Money Received against warrant convertible to equity shares

Ind AS 33 - Earnings per Share defines "Warrants" as " Financial Instruments which give the holder the right to acquire equity shares". Thus effectively, warrants are the amount which would ultimately form part of the Shareholders'' funds. Since, shares are yet to be allotted against the same, these are not reflected as part of Share Capital but as a separate line item - ''Money received against share warrants''.

(e) Capital reserve

The Company allotted 45,00,000 (Forty five Lakhs) convertible warrants of INR 100/- each to Mr Suresh Venkatachari, Promoter and Chief Executive Officer of the Company on March 17, 2021 on receipt of an upfront payment INR 11,25,00,000/- (Rupees Eleven Crores Twenty-Five Lakhs Only) equal to 25% of the total consideration as per the terms of preferential issue in compliance with Chapter V of SEBI (Issue of Capital & Disclosure Requirements) Regulations, 2018 and Section 42 & 62 of the Companies Act, 2013 and rules made thereunder as amended from time to time. The Company has considered equivalent shares of 45,00,000 (Forty five Lakhs) for the purpose of diluted EPS up to the period ended June 30, 2022 and 28,93,000 shares (Twenty eight lakhs ninety three thousand) for the period ended December 31, 2022 as per IND AS 33. During the year ended March 31, 2023, the Company has allotted 12,25,000 equity shares to Mr Suresh Venkatachari, as partial conversion of warrants and had 16,07,000 convertible warrants outstanding as at September 16, 2022. As the outstanding warrants were not exercised on or before the September 16, 2022, the Company had forfeited the money received against such warrants amounting to INR 4,01,75,000 and credited the capital reserve in accordance to the provisions of the Companies Act 2013.

(b) The Company was in receipt of a SEBI adjudication order on September 14, 2022 alleging violation under SEBI (LODR) Regulations, 2015 and was imposed a penalty of INR 25 lakhs. Consequently, the Company filed an appeal before Hon''ble Securities Appellate Tribunal and is awaiting further directives. The penalty amount of INR 25 lakhs has been provided on a prudent basis during the year ended March 31, 2023.

(c) The Company received final order from SEBI on December 16, 2022 on the alleged financial irregularities reported by the Company''s statutory auditor, viz. Deloitte Haskins and Sells in their audit report for FY 2018-19. SEBI''s final order gave certain directives and has imposed penalty of INR 400 lakhs on the Company. The Company has filed an appeal before Hon''ble Securities Appellate Tribunal and is awaiting further directives. The penalty amount of INR 400 lakhs has been provided on a prudent basis during the year ended March 31, 2023.

31 Employee benefits

(I) Defined contribution plan

During the year, the Company has recognised INR 124.17 lakhs (March 31, 2022 - INR 106.29 lakhs) as contribution to provident fund and other funds in the Statement of Profit and Loss (included in Contribution to Provident and other funds in Note 24).

(II) Defined benefit plans:

(a) Gratuity plan

The Company has a defined benefit gratuity plan. Every employee who has completed five years or more of service gets gratuity on departure at 15 days salary (last drawn salary) for each completed year of service subject to a maximum of INR 20 lakhs.

In case of death while in service, the gratuity is payable irrespective of vesting. The Company''s obligation towards its gratuity liability is unfunded. Liabilities related to the gratuity plan are determined and accrued by actuarial valuation using projected unit credit method by an independent actuary as at the balance sheet date.

Risk exposures

Provision of a defined benefit scheme poses certain risks, some of which are detailed hereunder, as company take on uncertain long term obligations to make future benefit payments

Interest rate risk: The plan exposes the Company to the risk of fall in interest rates. A fall in interest rates will result in an increase in the ultimate cost of providing the above benefit and will thus result in an increase in the value of the liability (as shown in standalone financial statements).

B) Salary escalation risk: The present value of the defined benefit plan is calculated with the assumption of salary increase rate of plan participants in future. Deviation in the rate of increase of salary in future for plan participants from the rate of increase in salary used to determine the present value of obligation will have a bearing on the plan''s liability.

C) Demographic risk: The Company has used certain mortality and attrition assumptions in valuation of the liability. The Company is exposed to the risk of actual experience turning out to be worse compared to the assumption.

D) Liquidity risk: This is the risk that the Company is not able to meet the short-term gratuity payouts. This may arise due to non availability of enough cash and cash equivalent to meet the liabilities or holding of illiquid assets not being sold in time.

The following tables summarises the components of net benefit expense recognised in the statement of profit and loss, the obligation amount recognised in the balance sheet towards the gratuity plan.

For the purpose of the Company''s capital management, capital includes issued equity capital, share premium and all other equity reserves attributable to the equity holders of the Company.

The Company''s capital management is intended to maximise the return to shareholders for meeting the long term and shortterm goals of the Company through the optimization of the debt and equity balance. The Company determines the amount of capital required on the basis of annual and long-term operating plans and strategic investment plans. The funding requirements are met through equity and long-term/short-term borrowings. The Company ensures that it will be able to continue as a going concern while maximising its returns to its shareholders by managing its capital by optimisation of the debt and equity balance. The Company monitors the capital structure on the basis of net debt to equity ratio and maturity profile of the overall debt portfolio of the Company.

The Company''s principal financial liabilities, comprise term loans, bank overdraft and trade and other payables. The main purpose of these financial liabilities is to raise finance for the Company''s operations. The Company has various financial assets such as trade receivables and other receivables, security deposits, investments and cash and bank balances, which arise directly from its operations.

The Company is exposed to market risk (including currency, interest rate and other market related risks), credit risk and liquidity risk. The Company''s senior management oversees the management of these risks. The Company''s primary risk management focus is to minimize potential adverse effects of these financial risks on its financial performance. The Company''s risk management assessment and policies and processes are established to identify and analyse the risks faced by the Company, to set appropriate risk limits and controls, and to monitor risks and compliance with the same. Risk assessment and management policies and processes are reviewed regularly to reflect changes in market conditions and the Company''s activities. The Board of Directors oversees and reviews the management of each of these risks, which are summarised below.

(a) Liquidity Risk Management

Liquidity risk is the risk that the Company will not be able to meet its financial obligations as they become due. The Company manages its liquidity risk by ensuring, as far as possible, that it will always have sufficient liquidity to meet its liabilities when due, under both normal and stressed conditions, without incurring unacceptable losses or risk to the Company''s reputation. The Company believes that the working capital and its cash and cash equivalent are sufficient to meet its short and medium term requirements.

The following tables detail the Company''s remaining contractual maturity for its financial liabilities with agreed repayment periods. The contractual maturity is based on the earliest date on which the Company may be required to pay.

Liquidity exposure as at:

(b) Credit Risk

Credit risk is the risk of financial loss to the Company if a customer or counterparty to a financial instrument fails to meet its contractual obligations and arises principally from the Company''s receivables from customers and from its financing activities, including deposits with banks and financial institutions, foreign exchange transactions and other financial instruments. Credit risk is managed through credit approvals, establishing credit limits and continuously monitoring the creditworthiness of customers to which the Company grants credit terms in the normal course of business.

Trade receivables: The Company''s exposure to credit risk is influenced mainly by the individual characteristics of each customer. The demographics of the customer, including the default risk of the industry and country in which the customer operates, also has an influence on credit risk assessment. The Company uses financial information and past experience to evaluate credit quality of majority of its customers and individual credit limits are defined in accordance with this assessment. Outstanding receivables and the credit worthiness of its counter parties are periodically monitored and taken up on case-to-case basis.

Credit risk on cash and cash equivalent is limited as the Company generally transacts with banks and financial institutions with high credit ratings assigned by international and domestic credit rating agencies.

(c) Market Risk

Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in market prices. Market risk comprises three types of risk: interest rate risk, currency risk and other price risk, such as equity price risk and commodity risk.

Financial instruments affected by market risk include all market risk-sensitive financial instruments, term loans, short term debts and trade receivables. The Company is exposed to market risk primarily related to foreign exchange currency risk and interest rate risk. Thus, the Company''s exposure to market risk is a function of investing and borrowing activities and revenue generating and operating activities in foreign currencies.

i. Interest Rate Risk

Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. The Company''s exposure to the risk of changes in market interest rates relates primarily to the Company''s debt obligations with floating interest rates. Other than overdraft facilities and term loans maintained with Indian Bank, the Company do not have any credit facilities from any banks or financial institutions with floating interest rates. As a result, changes in interest rates are not likely to substantially affect its business or results of operations.

ii. Foreign exchange rate risk

Foreign currency risk is the risk that the fair value or future cash flows of an expenses/ income will fluctuate because of change in foreign exchange rates. The Company''s exposure to the risk of changes in foreign exchange rates relates primarily to the Company''s operating activities (when revenue or expenses is denominated in a foreign currency) and the Company''s net investment in foreign subsidiary.

A significant portion of the Company''s revenues is in USD, while a significant portion of its costs are in Indian rupees. As a result, if the value of the Indian rupee appreciates relative to this foreign currency, the Company''s revenues measured in Indian rupees may decrease and vice versa. The exchange rate between the Indian rupee and US Dollar has not been subjected to significant changes in recent periods. The Company has a forex policy in place whose objective is to reduce foreign exchange risk by maintaining reasonable open exposures within approved parameters depending on the future outlook on currencies. The Company does not enter into or trade financial instruments including derivative financial instruments for speculative purpose.

The carrying amounts of the Company''s foreign currency denominated monetary assets and monetary liabilities at the end of each reporting period are as follows :

Notes:

1. Current ratio

The current ratio indicates a company''s overall liquidity position. It is widely used by banks in making decisions regarding the advancing of working capital credit to their clients.

Current Ratio = Current Assets / Current Liabilities

Decrease is due to reduction in trade receivables in the current year. The Company has collected aged dues during the year. As at March 31, 2023, the Company has no oustanding aged more than 180 days.

2. Debt - Equity Ratio

Debt-to-equity ratio compares a Company''s total debt to shareholders equity. Both of these numbers can be found in a Company''s balance sheet.

Debt - Equity Ratio = Total Debt / Shareholder''s Equity

Decrease in current year is due to reduction in debt. Company has repaid around INR 990.89 lakhs promoter loan and cleared INR 250 lakhs interest outstanding during the year.

3. Debt Service Coverage Ratio

Debt Service coverage ratio is used to analyse the firm''s ability to payoff current interest and instalments.

Debt Service Coverage Ratio = Earnings available for debt service / Debt Service

Increase in current year is due to lower losses made by the company in the current year when compared to previous year.

4. Return on Equity (ROE)

It measures the profitability of equity funds invested in the Company. The ratio reveals how profitability of the equity-holders'' funds have been utilized by the Company. It also measures the percentage return generated to equity-holders. The ratio is computed as:

ROE = Net Profits after taxes - Preference Dividend (if any) / Average Shareholder''s Equity

Increase in current year is due to lower losses made by the company in the current year when compared to previous year. 5.Inventory Turnover Ratio

This ratio also known as stock turnover establishes the relationship between the cost of goods sold during the period or sales during the period and average inventory held during the period. It measures the efficiency with which a Company utilizes or manages its inventory.

Inventory Turnover ratio = Cost of goods sold or sales / Average Inventory

The Company is in the business of providing software services and does not have any physical inventories. Hence, inventory turnover ratio is not applicable to the Company.

6. Trade receivables turnover ratio

It measures the efficiency at which the firm is managing the receivables.

Trade receivables turnover ratio = Net Credit Sales / Avg. Accounts Receivable

The Company has improved the ratio in the current year by collecting all aged dues outstanding more than 180 days.

7. Trade payables turnover ratio

It indicates the number of times sundry creditors have been paid during a period. It is calculated to judge the requirements of cash for paying sundry creditors. It is calculated by dividing the net credit purchases by average creditors.

Trade payables turnover ratio = Net Credit Purchases / Average Trade Payables

The Company has improved the ratio in the current year by prompt repayment on all dues within time.

8. Net capital turnover ratio

It indicates a company''s effectiveness in using its working capital. The working capital turnover ratio is calculated as follows: net sales divided by the average amount of working capital during the same period.

Net capital turnover ratio = Net Sales / Working Capital

Negative impact in current year is due to provision made towards statutory penalty which in turn resulted in negative in working capital.

9. Net profit ratio

It measures the relationship between net profit and sales of the business.

Net Profit Ratio = Net Profit / Net Sales

The Company has improved the ratio in the current year due to reduction in loss

10. Return on capital employed (ROCE)

Return on capital employed indicates the ability of a company''s management to generate returns for both the debt holders and the equity holders. Higher the ratio, more efficiently is the capital being employed by the company to generate returns.

ROCE = Earning before interest and taxes / Capital Employed

Decrease in current year is due to loss incurred by the Company in the current year.

11. Return on investment

Return on investment (ROI) is a financial ratio used to calculate the benefit an investor will receive in relation to their investment cost. The higher the ratio, the greater the benefit earned.

The Company has invested in its overseas subsidairies for business expansion, therby fueling further growth in new geographies. Hence, return on investment is not applicable for our Company.

i) The Company do not have any Benami property, where any proceeding has been initiated or pending against the Group for holding any Benami property under the Benami Transactions (Prohibition) Act, 1988 and rules made thereunder.

ii) The Company do not have any transactions with companies struck off under section 248 of Companies Act, 2013 or section 560 of Companies Act, 1956.

iii) The Company do not have any charges or satisfaction which is yet to be registered with ROC beyond the statutory period.

iv) The Company has not traded or invested in cryptocurrency transactions or virtual currency during the financial year

v) The Company has not advanced or loaned or invested funds to any other person(s) or entity(ies) including foreign entities (Intermediaries) with the understanding that the intermediary shall :

a. directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the company (Ultimate Beneficiaries) or

b. provide any guarantee, security or the like to or on behalf of the Ultimate Beneficiaries.

vi) The Company has not any such transaction which is not recorded in the books of accounts that has been surrendered or disclosed as income during the year in the tax assessments under the Income Tax Act, 1961 (such as, search or survey or any other relevant provisions of the Income Tax Act, 1961).

Notes:

(i) The Company accounts for costs incurred by / on behalf of the Related Parties based on the actual invoices / debit notes raised and accruals as confirmed by such related parties. The Related Parties have confirmed to the Management that as at March 31, 2023 and March 31, 2022, there are no further amounts payable to / receivable from them, other than as disclosed above. The Company incurs certain costs on behalf of other companies in the group. These costs have been allocated/recovered from the group companies on a basis mutually agreed to with the group companies.

(ii) Excludes gratuity and compensated absences which cannot be separately identifiable from the composite amount advised by the actuary.

(iii) The remuneration payable to key management personnel is determined by the nomination and remuneration committee having regard to the performance of individuals and market trends.

(iv) The amounts outstanding are unsecured and will be settled in cash. There have been no instances of amounts due to or due from related parties that have been written back or written off or otherwise provided for during the year.

(v) The Company has provided Corporate Guarantee amounting to USD 5 million to Columbia Bank for loans taken by SecureKloud Technologies Inc., USA (formerly 8K Miles Software Services Inc., USA), a subsidiary of the Company and USD 5 million to Seacoast Business Funding, a division of Seacoast National Bank against a Purchasing Agreement entered into by Healthcare Triangle Inc., USA, step down subsidiary of the Company.

37 Segment Reporting

The Company is engaged in Information and Technology Services. Based on the management approach as defined in Ind-AS 108 - Operating Segments, the senior management evaluates the Company''s performance and allocates resources based on an analysis of various performance indicators by the overall business / operating segment.

As the allocation of resources and profitability of the business is evaluated by the senior management on an overall basis, with evaluation into individual categories to understand the reasons for variations, no separate segments have been identified. Accordingly, the amounts appearing in these standalone financial statements relate to this operating segment.

Geographical Information:

The Company has operations within India as well as in other countries. The operations in United States of America constitute a major part of its operations. Management has reviewed the geographical areas vis-a-vis the risks and returns that encompass them. While arriving at this, management has reviewed the similarity of the economic and political conditions, relationships between operations in these geographical areas, proximity of operations, and special risks if any associated with operations in these areas.

41 Approval of Standalone Financial Statements

In connection with the preparation of the standalone financial statements for the year ended March 31, 2023, the Board of Directors have confirmed the propriety of the contracts / agreements entered into by / on behalf of the Company and the resultant revenue earned / expenses incurred arising out of the same after reviewing the levels of authorisation and the available documentary evidences and the overall control environment. Further, the Board of Directors have also reviewed the realizable value of all the current assets of the Company and have confirmed that the value of such assets in the ordinary course of business will not be less than the value at which these are recognised in the standalone financial statements. In addition, the Board has also confirmed the carrying value of the non-current assets in the standalone financial statements. The Board, duly taking into account all the relevant disclosures made, has approved these standalone financial statements in its meeting held on May 29, 2023 in accordance with the provisions of Companies Act, 2013.

As per our report of even date.

For K Gopal Rao & Co., For and on behalf of the Board of Directors

Chartered Accountants

FRN:000956S

Thyagarajan R Biju Chandran

Whole-time Director and Chief Financial Officer Independent Director

DIN:00942326 DIN: 06540000

CA Gopal Krishna Raju Roshini Selvakumar

Partner Company Secretary

Membership No. 205929

UDIN:23205929BGVFED1724

Place : Chennai Place : Chennai

Date: May 29, 2023 Date: May 29, 2023

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Mar 31, 2018

1 CORPORATE INFORMATION

8K Miles Software Services Limited (“8K Miles” or “the Company”) was incorporated in the year 1985 in the name of Rosebud Commercials Limited and the Company’s name was changed to P M Strips Limited in 1998 and subsequently to 8K Miles Software Services Limited in October 201 0. The Company is a distributed platform that blends a global talent market place with collaboration tools and cloud infrastructure, helping small and medium enterprises (SMB’s) and large enterprise customers to integrate Cloud computing and Identity Security into their Information and Technology (“IT”) and business strategies.

2 APPLICATION OF NEW AND REVISED IND AS

All the Indian Accounting Standards issued and notified by the Ministry of Corporate Affairs under the Companies (Indian Accounting Standards) Rules, 201 5 (as amended) till the financial statements are authorised have been considered in preparing these financial statements.

Recent Accounting Pronouncements:

Recent Standards notified but not effective:

Ind AS 115 - “Revenue from Contracts with Customers”:

On March 28, 2018, the Ministry of Corporate Affairs (MCA), notified Ind AS 115, Revenue from Contracts with Customers, as part of the Companies (Indian Accounting Standards) Amendment Rules, 2018. The new standard is based on IFRS 15, Revenue from Contracts with Customers. The standard is effective for the accounting periods commencing on or after 1 April 2018.

Ind AS 115 replaces Ind AS 11 Construction contracts and Ind AS 18 Revenue. The core principle of Ind AS 115 is that an entity recognises revenue to depict the transfer of goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. This core principle is delivered in a five-step model framework:

(a) Identify the contract(s) with a customer -assess whether the contract is within the scope of Ind AS 115. ‘Customer’ has now been defined.

(b) Identify the performance obligations in the contract - determine whether the goods and services in a contract are distinct.

(c) Determine the transaction price - transaction price will include fixed, variable and non cash considerations.

(d) Allocate the transaction price to the performance obligations in the contract -allocation based on a stand-alone selling price basis using acceptable methods.

(e) Recognise revenue when (or as) the entity satisfies a performance obligation - i.e. recognise revenue at a point in time or over a period of time based on performance obligations.

The Company is evaluating the requirements of the standards, and the transition effects on the financial statements.

Appendix B to Ind AS 21, Foreign currency transactions and advance consideration:

On March 28, 2018, Ministry of Corporate Affairs (“MCA”) has notified the Companies (Indian Accounting Standards) Amendment Rules, 2018 containing Appendix B to Ind AS 21, Foreign currency transactions and advance consideration which clarifies the date of the transaction for the purpose of determining the exchange rate to use on initial recognition of the related asset, expense or income, when an entity has received or paid advance consideration in a foreign currency. The amendment will come into force from 1 April 2018. The Company is evaluating the effect of this on the financial statements.

Standards yet to be notified:

Ind AS 116 - “Leases”:

On July 18, 2017, the Accounting Standards Board (ASB) of the Institute of Chartered Accountants of India (ICAI) issued an Exposure Draft (ED) of Ind AS 116, Leases. Ind AS 116 is largely converged with IFRS 16. When notified, Ind AS 116 will replace Ind AS 17 Leases.

I nd AS 116 sets out a comprehensive model for identification of lease arrangements and their treatment in the financial statements of the lessor and lessee. Ind AS 116 applies a control model for the identification of leases, distinguishing between leases and service contracts on the basis of whether there is an identified asset controlled by the customer. The Company is evaluating the requirement of the standard and the effect on the financial statements.

3 CRITICAL ACCOUNTING JUDGEMENTS AND KEY SOURCES OF ESTIMATION UNCERTAINTY

“ In the application of the Company’s accounting policies, which are described in note 3, the directors of the Company are 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 revision affects both current and future periods.”

“The following are the significant areas of estimation, uncertainty and critical judgements in applying accounting policies:

- Useful lives of Property, plant and equipment and intangible assets (Refer Note 3.6)

- Provision for taxation (Refer Note 3.15)

- Provision for disputed matters (Refer Note 3.16)

- Provision for Employee benefits (Refer Note 3.12)

Determination of functional currency:

Currency of the primary economic environment in which the Company operates (“the functional currency”) is Indian Rupee (INR) in which the company primarily generates and expends cash. Accordingly, the Management has assessed its functional currency to be Indian Rupee (INR).

4.1 Credit period and risk

The average credit period for the services rendered:

(a) Trade receivables (Domestic) are non-interest bearing and are generally on terms of upto 30 days.

(b) Trade receivables (International & Related Party) are non-interest bearing and are generally on terms of upto 3 - 9 months.

No trade receivable are due from directors or other officers of the Company either severally or jointly with any other person. Nor any trade receivable are due from firms or private companies respectively in which any director is a partner, a director or a member.

4.2 Expected credit loss allowance

The Company has used a practical expedient by computing the expected loss allowance for trade receivables based on provision matrix. The provision matrix takes into account the historical credit loss experience and adjustments for forward looking information.

Based on the assessment of the Company, there is no risk associated with the dues from the related parties both from a credit risk or time value of money as these are managed through the group’s cash management process and can be recovered on demand by the Company. Accordingly, no provisions has been considered necessary.

With regard to other parties, the company had, based on past experience, wherein collections are done within a year of it being due and expectation in the future Credit loss, has made necessary provisions.

(ii) Terms/rights attached to equity shares

The Company has one class of equity shares having a par value of Rs.5/- per share. Each shareholder is eligible for one vote per share held. The dividend proposed if any, by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting, except in case of interim dividend. In the event of liquidation, the equity shareholders are eligible to receive the remaining assets of the Company after distribution of all preferential amounts, in proportion to their shareholding.

(iv) There are no shares which are reserved for issuance and there are no securities issued/ outstanding which are convertible into equity shares.

(v) Issue of Bonus Shares during immediately preceding 5 years.

Notes:

(i) The details of Security provided against the Term Loans & Loans Repayable on Demand are as follows:

(a) Indian Bank Term Loan and working capital loan are Secured against Hypothecation of Book Debts (Accounts receivable), Fixed Assets and personal guarantee of Managing Director and Whole Time Director.

(b) Collateral security provided is the property situated at 168, Eldams Road, Chennai -18 owned by Managing Director.

(c) The loan is also further secured by pledge of 300,000 shares of 8K Miles Software Services Limited held by Managing Director.

(d) Collateral security provided is the property situated at 44, Anna Salai Lane, Saidapet, Chennai - 15 owned by Ms. T.P. Saira (Former Director)

(ii) The loan is secured by hypothecation of respective vehicle financed by the Bank.

(iii) The details of Security provided against the IFCI Term Loan are as follows:

(a) Secured against pledge of 8K Miles Software Services Limited shares at least 2.5 times of outstanding loan amount and personal guarantee of Managing Director and Whole Time Director.

(b) Lien marked Fixed Deposit in favour of IFCI equivalent to 3 months interest due and PDCs for Interest and principal repayments

(iv) During the current year ended March 31, 2018, the Company has obtained an unsecured loan of Rs.3,750 lakhs from R.S. Ramani, Whole Time Director. The Company has obtained a declaration from the Director that the loan has not been given out of funds borrowed or deposits accepted from others.

5 EARNINGS PER SHARE

The earnings and weighted average number of ordinary equity shares used in the calculation of basic and diluted earnings per share are as follows:

6 LEASE ARRANGEMENTS

(a) Operating Leases

The Company has entered into operating lease agreements primarily for Office premises. An amount of Rs.226.74 lakhs (Previous Year - Rs.167.63 lakhs) has been debited to the Statement of Profit and Loss towards lease rentals and other charges for the current year. The leases are non cancellable for periods of 3 to 9 years and may be renewed based on mutual agreement of the parties.

The future minimum lease payments for office premises under operating lease contracted are as follows:

Note:

The amounts shown above as Contingent Liabilities and other disputed claims represent the best possible estimates arrived at on the basis of the available information. The uncertainties and possible reimbursement are dependent on the outcome of the various legal proceedings which have been initiated by the Company or the claimants, as the case may be and, therefore, cannot be predicted accurately. The Company expects a favourable decision with respect to all the above disputed demands / claims based on professional advice and, accordingly, believes that no specific adjustment/provision is required in respect of these matters at this stage.

7 EMPLOYEE BENEFITS

(I) Defined Contribution Plan

The Company makes provident fund contribution which is defined contribution plan, for qualifying employees. Under the scheme, the company is required to contribute a specified percentage of the payroll costs to fund the benefits. The contributions payable to the plan by the Company are at rates specified in the rules of the scheme.

(II) Defined Benefit Plans:

The Company offers ‘Gratuity’ (Refer Note 23 - Employees Benefits Expense) as a post employment benefit for qualifying employees and operates a gratuity plan. The benefit payable is calculated as per the Payment of Gratuity Act, 1972 and the benefit vests upon completion of five years of continuous service and once vested it is payable to employees on retirement or on termination of employment. In case of death while in service, the gratuity is payable irrespective of vesting. The Company’s obligation towards its gratuity liability is a defined benefit plan.

Description of Risk Exposures

Valuations are performed on certain basic set of pre-determined assumptions and other regulatory framework which may vary over time. Thus, the Company is exposed to various risks in providing the above gratuity benefit which are as follows:

A) Interest Rate risk: The plan exposes the Company to the risk of fall in interest rates. A fall in interest rates will result in an increase in the ultimate cost of providing the above benefit and will thus result in an increase in the value of the liability (as shown in financial statements).

B) Salary Escalation Risk: The present value of the defined benefit plan is calculated with the assumption of salary increase rate of plan participants in future. Deviation in the rate of increase of salary in future for plan participants from the rate of increase in salary used to determine the present value of obligation will have a bearing on the plan’s liability.

C) Demographic Risk: The Company has used certain mortality and attrition assumptions in valuation of the liability. The Company is exposed to the risk of actual experience turning out to be worse compared to the assumption.

D) Liquidity Risk: This is the risk that the Company is not able to meet the short-term gratuity payouts. This may arise due to non availabilty of enough cash/cash equivalent to meet the liabilities or holding of illiquid assets not being sold in time.

I n respect of the plan, the most recent actuarial valuation of the present value of the defined benefit obligation were carried out as at 31 March 2018 by Sapna Malhotra, Fellow of the Institute of Actuaries of India. The present value of the defined benefit obligation, and the related current service cost and paid service cost, were measured using the projected unit credit method.

(i) The current service cost and interest expense for the year are included in the “Employee Benefit Expense” in the statement of profit & loss under the line item “Gratuity Expenses”

(ii) The remeasurement of the net defined benefit liability is included in other comprehensive income.

Significant actuarial assumptions for the determination of defined obligation are discount rate, expected salary increase and withdrawal rate. The sensitivity analysis below have been determined based on reasonably possible changes of the respective assumptions occurring at the end of the reporting period while holding all other assumptions constant. The results of sensitivity analysis is given below:

The sensitivity analysis presented above may not be representative of the actual change in the defined benefit obligations as it is unlikely that the change in assumptions would occur in isolation of one another as some of the assumptions may be correlated.

Furthermore in presenting the above sensitivity analysis the present value of defined benefit obligation has been calculated using the projected unit credit method at the end of the reporting period which is the same as that applied in calculating the defined benefit obligation liability recognised in the balance sheet.

There is no change in the methods and assumptions used in preparing the sensitivity analysis from the prior years. The estimate of future salary increases, considered in actuarial valuation, takes account of inflation, seniority, promotion and other relevant factors, such as supply and demand in the employment market.

(III) Compensated Absences

Provision for Short Term Compensated Absences is made at current encashable salary rates for the unavailed leave balance standing to the credit of the employees as at the date of the Balance Sheet in accordance with the rules of the Company.

8 FINANCIAL INSTRUMENTS

(I) Capital Management

The Company’s capital management is intended to maximise the return to shareholders for meeting the long-term and short-term goals of the Company through the optimization of the debt and equity balance. The Company determines the amount of capital required on the basis of annual and longterm operating plans and strategic investment plans. The funding requirements are met through equity and long-term/short-term borrowings. The Company monitors the capital structure on the basis of Net debt to equity ratio and maturity profile of the overall debt portfolio of the Company. The Company ensures that it will be able to continue as a going concern while maximising its returns to its shareholders by managing its capital by optimisation of the debt and equity balance. The following table summarises the capital of the Company:

(II) Categories of Financial Instruments

The carrying value of financial instruments by categories as at 31 March 2018, 31 March 2017 and 1 April 2016 is as follows:

The Management assessed that the fair value of cash and cash equivalents, trade receivables, loans, borrowings, trade payables and other financial assets and liabilities approximate their carrying amounts largely due to the short term maturities of these instruments

The fair value of the financial assets and labilities is included at the amount at which the instrument could be exchanged in a current transaction between willing parties, other than in a forced or liquidation sale.

The following methods and assumptions were used to estimate the fair value/ amortised cost:

a) Long-term fixed-rate receivables/borrowings are evaluated by the Company based on parameters such as interest rates, individual creditworthiness of the customer and the risk characteristics of the financed project. Based on this evaluation, allowances are taken into account for the expected credit losses of these receivables.

b) Fair values of the Company’s interest-bearing borrowings and loans are determined by using discounted cash flow (DCF) method using discount rate that reflects the issuer’s borrowing rate as at the end of the reporting period. The own non- performance risk as at 31 March 2018 was assessed to be insignificant.

(III) Financial Risk Management Framework

The Company’s activities expose it to a variety of financial risks: liquidity risk, credit risk and market risk (including currency, interest rate and other market related risks). The Company’s primary risk management focus is to minimize potential adverse effects of market risk on its financial performance. The Company’s risk management assessment and policies and processes are established to identify and analyse the risks faced by the Company, to set appropriate risk limits and controls, and to monitor risks and compliance with the same. Risk assessment and management policies and processes are reviewed regularly to reflect changes in market conditions and the Company’s activities. The Board of Directors and the Chief Financial Officer is responsible for overseeing the Company’s risk assessment and management policies and processes.

(a) Liquidity Risk Management :

Liquidity risk is the risk that the Company will not be able to meet its financial obligations as they become due. The Company manages its liquidity risk by ensuring, as far as possible, that it will always have sufficient liquidity to meet its liabilities when due, under both normal and stressed conditions, without incurring unacceptable losses or risk to the Company’s reputation. The Company believes that the working capital and its cash and cash equivalent are sufficient to meet its short and medium term requirements.

The following tables detail the Company’s remaining contractual maturity for its financial liabilities with agreed repayment periods and the maturity periods of its financial assets. The contractual maturity is based on the earliest date on which the Company may be required to pay.

The following table details the Company’s expected maturity for its financial assets. The table has been drawn up based on the undiscounted contractual maturities of the financial assets. The inclusion of information on non-derivative financial assets is necessary in order to understand the Company’s liquidity risk management as the liquidity is managed on a net asset and liability basis.

(b) Credit Risk:

Credit risk is the risk of financial loss to the Company if a customer or counterparty to a financial instrument fails to meet its contractual obligations, and arises principally from the Company’s receivables from customers and from its financing activities, including deposits with banks and financial institutions, foreign exchange transactions and other financial instruments. Credit risk is managed through credit approvals, establishing credit limits and continuously monitoring the creditworthiness of customers to which the Company grants credit terms in the normal course of business.

Trade receivables: The Company’s exposure to credit risk is influenced mainly by the individual characteristics of each customer. The demographics of the customer, including the default risk of the industry and country in which the customer operates, also has an influence on credit risk assessment. The Company uses financial information and past experience to evaluate credit quality of majority of its customers and individual credit limits are defined in accordance with this assessment. Outstanding receivables and the credit worthiness of its counter parties are periodically monitored and taken up on case to case basis.

Credit risk on current investments, cash & cash equivalent and derivatives is limited as the Company generally transacts with banks and financial institutions with high credit ratings assigned by international and domestic credit rating agencies.

(c) Market Risk :

Market risk is the risk of loss of any future earnings, in realizable fair values or in future cash flows that may result from adverse changes in market rates and prices (such as interest rates and foreign currency exchange rates) or in the price of market risk-sensitive instruments as a result of such adverse changes in market rates and prices. Market risk is attributable to all market risk-sensitive financial instruments, all foreign currency receivables and payables and all short-term debt. The Company is exposed to market risk primarily related to foreign exchange currency risk and interest rate risk. Thus, the Company’s exposure to market risk is a function of investing and borrowing activities and revenue generating and operating activities in foreign currencies.

i. Interest Rate Risk

Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. The Company’s exposure to the risk of changes in market interest rates relates primarily to the Company’s debt obligations with floating interest rates. The Company manages this by considering only short-term borrowings.

ii. Foreign exchange rate risk:

The Company’s foreign currency risk arises from its foreign currency revenues and expenses, (primarily in USD). A significant portion of the Company’s revenues is in USD, while a significant portion of its costs are in Indian rupees. As a result, if the value of the Indian rupee appreciates relative to this foreign currency, the Company’s revenues measured in Indian rupees may decrease and vice versa. The exchange rate between the Indian

rupee and US Dollar has not been subjected to significant changes in recent periods. The Company has a forex policy in place whose objective is to reduce foreign exchange risk by maintaining reasonable open exposures within approved parameters depending on the future outlook on currencies.

The Company does not enter into or trade financial instruments including derivative financial instruments for speculative purpose.

The carrying amounts of the Company’s foreign currency denominated monetary assets and monetary liabilities at the end of each reporting period are as follows :

Out of the above foreign currency exposures, none of the monetary assets and liabilities are hedged by derivative instruments or otherwise.

Foreign Currency sensitivity analysis:

The following table details the Company’s sensitivity to a 5% increase and decrease in INR against the relevant foreign currencies. 5% is the rate used in order to determine the sensitivity analysis considering the past trends and expectation of the management for changes in the foreign currency exchange rate. The sensitivity analysis includes the outstanding foreign currency denominated monetary items and adjusts their translation at the period end for a 5% change in foreign currency rates. A positive number below indicates a increase in profit / decrease in loss and increase in equity where the INR strengthens 5% against the relevant currency. For a 5% weakening of the INR against the relevant currency, there would be a comparable impact on the profit or loss and equity and balance below would be negative.

The Company is mainly exposed to the following foreign currencies.

(ii) Excludes gratuity and compensated absences which cannot be separately identifiable from the composite amount advised by the actuary.

(iii) The remuneration payable to key management personnel is determined by the nomination and remuneration committee having regard to the performance of individuals and market trends.

(iv) The amounts outstanding are unsecured and will be settled in cash. No guarantees have been given or received. There have been no instances of amounts due to or due from related parties that have been written back or written off or otherwise provided for during the year.

9 SEGMENT REPORTING

The Company is engaged in Information and Technology Services. Based on the “management approach” as defined in Ind-AS 108 - Operating Segments, the Chief Operating Decision Maker (CODM) evaluates the Company’s performance and allocates resources based on an analysis of various performance indicators by the overall business / operating segment.

As the allocation of resources and profitability of the business is evaluated by the CODM on an overall basis, with evaluation into individual categories to understand the reasons for variations, no separate segments have been identified. Accordingly, the amounts appearing in these financial statements relate to this operating segment.

9.1 Geographical Information:

The Company has operations within India as well as in other countries. The operations in United States of America constitute the major part of the operations. Management has reviewed the geographical areas vis-a-vis the risks and returns that encompass them. While arriving at this, management has reviewed the similarity of the economic and political conditions, relationships between operations in these geographical areas, proximity of operations, and special risks if any associated with operations in these areas.

10 ADDITIONAL INFORMATION TO THE FINANCIAL STATEMENTS

33.1 Disclosures required under Section 22 of the Micro, Small and Medium Enterprises Development Act, 2006

Based on and to the extent of information received by the Company from the suppliers during the year regarding their status under the Micro, Small and Medium Enterprises Development Act, 2006 (MSMED Act), which has been relied upon by the Auditors, the relevant particulars are furnished below.

11.1.1 Reconciliation of income tax

A reconciliation of income tax expense applicable to accounting profit / (loss) before tax at the statutory income tax rate to recognised income tax expense for the year indicated are as follows :

The actual tax rates under Indian Income Tax Act, for the tax years ended 31 March 2018 and 31 March 2017 were 33.063%.

11.2 Deferred Tax Balances

The following is the analysis of the net deferred tax asset/(liability) position as presented in the financial statements

12 TRANSITION TO INDIAN ACCOUNTING STANDARDS (IND AS)

12.1 First-time adoption - mandatory exceptions, optional exemptions

The Company’s financial statements for the year ended 31 March 2018 are prepared in accordance with the Indian Accounting Standards (“Ind AS”) notified under the Companies (Indian Accounting Standards) Rules, 2015. The adoption of Ind AS was carried out in accordance with Ind AS 101, using 1 April 2016 as the transition date. Ind AS 101 requires that all Ind AS standards and interpretations that are effective for the Ind AS financial statements for the year ended 31 March 2018, be applied consistently and retrospectively for all fiscal years presented. All applicable Ind AS have been applied consistently and retrospectively wherever required. The resulting difference between the carrying amounts of the assets and liabilities in the financial statements under both Ind AS and previous GAAP as at the transition date have been recognized directly in equity at the transition date.

Mandatory Exceptions and Optional Exemptions

(a) Deemed Cost for Property, plant and equipment and intangible assets

The Company has elected to continue with the carrying value of all of its property, plant and equipment and intangible assets recognized as at 1 April 2016 (transition date) measured as per the previous Indian GAAP (‘I GAAAP’) and use that carrying value as its deemed cost as of the transition date.

(b) Classification and measurement of financial assets

The company has opted not to apply EIR principles retrospectively and thus opted to consider the carrying cost of financial asset as its amortised cost as at transition date.

Key Sources of estimation uncertainity

The estimates at 1 April 2016 and at 31 March 2017 are consistent with those made for the same dates in accordance with previous GAAP (after adjustments to reflect any differences in accounting policies). The estimates used by the Company to present these amounts in accordance with Ind AS reflect conditions at 1 April 2016, the date of transition to Ind AS and as of 31 March 2017.

First time IND AS Adoption Reconciliation :

The following reconciliations provide the effect of transition to Ind AS from IGAAP in accordance with Ind AS 101:

1. Equity as at 1 April 2016 and 31 March 2017

2. Net profit and total comprehensive income for the year ended 31 March 2017 and

3. Cash flows for the year ended 31 March 2017.

Note 13.1 Notes on Reconciliation

(a) Previous GAAP balances have been regrouped to comply with the Companies ( Accounting Standard) Rules, 2006 , certain account balances have been regrouped as per the format prescribed under Division II of Schedule III to the Companies Act 2013.

(b) The company had not recognised the provision for employee benefits and rent equalistion for the year ended 31 March 2017 and 31 March 2016, and the same has been recognised in the respective financial years.

(c) Under previous GAAP, the interest free security deposits, with fixed terms, were considered at historical cost. Under Ind AS these financial assets have been adjusted to be carried at amortized cost. The notional cost of interest on deposits under Ind AS has been recognised as rental expense and the interest accrual has been recognised as interest income earned on financial assets that are not designated as at fair value through profit or loss.

The effect of this change is decrease in financial assets by Rs.60.20 lakhs as at 31 March 2017 (decrease by Rs.13.51 lakhs as at 1 April 2016) and increase in other current assets by Rs.59.02 lakhs as at 31 March 2017 (increase by Rs.13.03 lakhs as at 1 April 2016) and decrease in total equity by Rs.0.70 Lakhs (decrease by Rs.0.48 lakhs as at 1 April 2016). There had been increase in other income by Rs.5.00 lakhs and other expenses by Rs.5.70 lakhs for the year ended 31 March 2017 and consequently increase in deferred tax asset by Rs.0.33 lakhs as at 31 March 2017 (Rs.0.16 Lakhs as at 1 April 2016).

(d) Under previous GAAP, Borrowing cost and processing fees related to loans and financial liabilities were charged off to the statement of profit and loss. Under Ind AS, the Company needs to measure the borrowings at fair value using Effective interest rate (EIR) also considering the Upfront fees and Processing fees paid and any interest free loan at the time of obtaining the borrowings.

The net effect of change is decrease in borrowings under non current liabilities by Rs.18.54 lakhs as at 31 March 2017 (Rs. NIL as at 1 April 2016) and increase in total equity by Rs.18.54 lakhs as at 31 March 2017 (Rs. NIL lakhs as at 1 April 2016). There had been decrease in finance cost by Rs.18.54 lakhs and decrease in deferred tax asset by Rs.5.10 lakhs as at 31 March 2017 (Rs. NIL as at 1 April 2016).

(e) Under previous GAAP, the Company made provision for doubtful debts for Trade Receivables based on the ageing analysis and individual debtor assessment of recoverability. Under IND AS the impairment model of financial asset is based on Expected Credit Loss model. Accordingly, the Company has provided loss allowance based on Expected credit loss and as a result trade receivables and other receivables has decreased by Rs.658.96 lakhs as at 31 March 2017 (decreased by Rs.649.33 lakhs as at 1 April 2016). Retained earnings under other Equity decreased by Rs.649.33 lakhs as at 1 April 2016. Consequently, allowance for expected credit losses under other expenses decreased by Rs.9.63 lakhs for the year ended 31 March 2017.

(f) Based on the evaluation made by the management, the entire balance of goodwill as at 1 April 2016 has been impaired. Accordingly, the goodwill amounting to Rs.25.55 lakhs which was amortised under previous GAAP has been reversed during the financial year ended 31 March 2017.

(g) Under previous GAAP, actuarial gains and losses were recognised in profit and loss. Under Ind AS, the actuarial gains and losses form part of remeasurement of net defined liability/asset which is recognised in other comprehensive income. Consequently, the tax effect of the same has also been recognised in other comprehensive income. The actuarial loss for the year ended 31 March 2017 was Rs.2.24 lakhs and tax effect was Rs.0.74 lakhs (tax reversal) and deferred tax asset increased by Rs.0.74 lakhs as at 31 March 2017.

(h) Under previous GAAP the deferred tax was accounted based on timing differences impacting the Statement of Profit and Loss for the period. Deferred tax under Ind AS has been recognised for temporary differences between tax base and the book base of the relevant assets and liabilities. As a result thereof, the deferred tax asset has increased by Rs.176.79 lakhs as at 31 March 2017 (increased by Rs.223.29 lakhs as at 1 April 2016).

(i) The previous GAAP figures have been reclassified to conform to Ind AS presentation requirements for the purposes of this date.

14 PREVIOUS YEAR FIGURES

As stated in Note 3.1, the Company has adopted Indian Accounting Standards with effect from 1 April 2017 with date of transition to Ind AS being 1 April 2016. Accordingly, previous year figures in the financial statements have been restated to Ind AS.

The standalone financial statements pertaining to the corresponding year ended 31 March 2017 and the equity balance as at 01 April 2016 have been complied under Ind AS after adjusting the previously issued standalone financial statements prepared in accordance with IGAAP which were audited by the predecessor auditors, on which they issued an unmodified opinion. The adjustments made to the previously issued IGAAP standalone financial statements to comply with Ind AS have been audited by the statutory auditors of the Company.

15 APPROVAL OF FINANCIAL STATEMENTS

The Board of Directors of the Company has reviewed the realisable value of all the current assets and has confirmed that the value of such assets in the ordinary course of business will not be less that the value at which these are recognized in the financial statements. In addition, the Board has also confirmed the carrying value of the non-current assets in the financial statements. The Board, duly taking into account all the relevant disclosures made, has approved these financial statements in the meeting in accordance with the provisions of Companies Act, 2013.

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Mar 31, 2017

back ground

8K Miles Software Services Limited (“the company”), Listed company, incorporated in the year 1985 in the name of Rosebud commercials Limited and the company’s name was changed to p M Strips Limited in September 1998 and subsequently to 8K Miles Software Services Limited in October 2010. The company is a distributed development platform that blends a global talent market place with collaboration tools and cloud infrastructure, helping Small and Medium Enterprises Startups (SMBs) and large Enterprise customers to integrate cloud computing and Identity Security into their Information and Technology (“IT”) and business strategies.

1.1 RELATED PARTY DISCLOSURES

1. Relationships

Major shareholders in the company

- Mr. Venkatachari Suresh - 55.80%

- Mr. R.S. Ramani- 7.07%

Subsidiaries of the company.

Other parties where common control exists.

- 8K Miles Media Private Limited, Chennai, India.

Key Managerial Personnel

- Mr. Venkatachari Suresh, Managing Director

- Mr. R.S.Ramani, Whole Time Director & CFO Relatives of Key Managerial Personnel

- There is no relationship existing among Key Management Personnel.

2. Transactions with Related Parties:-

i) Services availed

# During the year the company has leased a commercial property situated in Eldams Road, Alwarpet, chennai - 600 018 owned by Mr. Venkatachari Suresh, managing Director for Business purpose. The property comprise of 12610 sq.ft. and these are lease rents and lease advance paid as per the present market condition for the area. The tenure of the lease is nine years effective from October, 2016.

ii) Remuneration to Key Management Personnel

iii) Amount due to Directors :

iv) Subsidiaries and Associates of the company:

1.2 CASH FLOW STATEMENT

The cash Flow Statement are reported using the indirect method, whereby net profit after tax is adjusted for the effects of transactions of noncash nature and any deferrals or accruals of past or future cash receipts or payments. The cash flows from operating, investing and financing activities of the company are segregated, if necessary.

1.3 OTHER INFORMATION

Auditor’s Remuneration

1.4 DISCLOSURE ON TRANSACTIONS IN DEMONETISED NOTES AND OTHER NOTES DURING THE PERIOD 08.11.2016 AND 30.12.2016

1.5 PREVIOUS YEAR FIGURES

Figures for the prior year have been regrouped, recast or rearranged to conform to the current year’s classification/presentation.

2 SHARE CAPITAL

The Authorised Capital means the sum mentioned in the capital clause of the Memorandum of Association. it is the maximum amount which the Company can raise by issuing the shares and on which the registration fees is paid. The limit cannot be exceeded unless the Memorandum of Association is altered. issued Capital denotes that part of the Authorized Capital which has been offered for subscription to members. Subscribed Capital means that part of the issued Capital which has been subscribed or taken by the purchase of shares in the Company. Paid up Capital denotes that the total amount of captal which is actually paid to the Company by the Members.

* The company has received income tax assessment order under section 143 (1), 143 (3) & 143 (1a) of the Income Tax Act 1961, pertaining to previous financial years 2007-08, 2009-10, 2010-11. The company has not accepted these orders and has been advised by its Legal counsel/advisors to prefer appeals before appellate authorities and accordingly the company has contested these by way of appeals before the Jurisdictional Assessing Officer, Hyderabad

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Mar 31, 2016

1 share capital

The Authorized Capital means the sum mentioned in the capital clause of the Memorandum of Association. It is the maximum amount which the Company can raise by issuing the shares and on which the registration fees is paid. The limit cannot be exceeded unless the Memorandum of Association is altered. Issued Capital denotes that part of the Authorized Capital which has been offered for subscription to members. Subscribed Capital means that part of the Issued Capital which has been subscribed or taken by the purchase of shares in the Company. Paid up Capital denotes that the total amount of capital which is actually paid to the Company by the Members.

E. Application Money pending allotment

This represents initial money received on account of issuance of convertible warrants with a right to exercise by the Warrant holders to subscribe for one equity share per Warrant on such other terms and conditions as the Board may in it absolute discretion decide at the time of issue of Securities, and at such price or prices, including premium if any, as may be determined and approved by the Board in accordance with the provisions specified in the SEBI ICDR Regulations.

2 CONTINGENT LIABILITIEs AND COMMITMENTs (TO THE EXTENT NOT PROVIDED FOR)

There are no known contingent liabilities and commitments as at the end of 31st March, 2016. As per our report of even date attached

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Mar 31, 2014

1 CONTINGENT LIABILITIES AND COMMITMENTS (TO THE EXTENT NOT PROVIDED FOR) As at As at Particulars 31 March 2014 31 March 2013 Rs. Rs.

Contingent Liabilities

* Claims against the company not acknowledged as debts

* Guarantees

* Other money for which company is contingently liable

* Bills discounted with banks

Total (A) - -

Commitments

* Estimated amount of contracts remaining to be executed on capital account and not provided for

* Uncalled liability on shares and other investments partly paid

* Others

The company had provided for Rs.6,53,089/- as Minimum Alternate tax for the Ay 2011-12. Notice of Demand under Income Tax Act, 1961 of Rs.11,90,670/- for the AY 2011-12 has been 537,581 537,581 received and the Company havn''t made any representation before the income tax authorities. No provision has been made in the books of account for the difference amount. The company has not paid any amount of tax relating to AY 2011-12

Total (B) 537,581 537,581

TOTAL [(A) (B)] 537,581 537,581



2 RELATED PARTY DISCLOSURES:

1. Relationships

Category - I - Major shareholders in the company:

* Mr. Suresh Venkatachari - 59.10%

* Mr.R.S.Ramani - 6.56%

Category - II - Subsidiaries and Associates of the company.

* Mentor minds solutions and Services Inc (USA) -100% subsidiary company

* Mentor minds solutions & Services Pvt Ltd-100% subsidiary company

* 8k miles Software Services Inc. (USA) -59.72% held subsidiary company

* 8k miles Software Services (FZE) (UAE) -100% subsidiary company

Category - III - Other parties where common control exists.

* 8k Miles Web Services Private Limited - No.7, 3rd floor,

Ganapathy Colony 3 rd street, Teynampet, Chennai - 600018.

* Vinoosh Foods and Entertainment Private Limited - No.7, 3rd floor, Ganapathy Colony 3rd street, Teynampet, Chennai - 600018.

Category - IV - Key Managerial Personnel:

* Mr. Suresh Venkatachari, Director

* Mr.R.S.Ramani, Director

* Ms.T.P.Saira, Director

Category - V - Relatives of Key Managerial Personnel:

* There is no relationship existing among Key Management Personnel.

2. Transactions with related parties:-

Category - I - maj or shareholders in the company:

Loan Received from Directors:

* Mr. Suresh Venkatachari : Rs. 8,23,104/-

* Mr.R.S.Ramani: Rs.6,40,287/-

Category - II - Subsidiaries and Associates of the company.

8k miles Software Services INC (USA) :

Amount invested in share capital: US$ 1,000.00 (Rs.45,220/-)

8k miles Software Services FZE (UAE):

Amount invested in share capital: AED150,000(Rs.18, 40,500/-)

Mentor Minds Solutions and Services Inc:

Amount invested in share capital: Rs. 11,50,11,500/

Outstanding receivable as on 31st March 2014: Rs.32,96,700/-

Mentor Minds Solutions & Services Private Limited:

Amount invested in share capital: Rs.88,07,505/-

Outstanding Receivable as on 31 st March 2014: Rs. 87,62,318/

Category - III - Other parties where common control exists.

8k Miles Web Services Private Limited

Consideration payable for business purchased outstanding as on 31st March 2014 - Rs.60,72,086/-

Vinoosh Foods and Entertainment Private Limited Outstanding Receivable as on 31 st March 2014: Rs. 16,97,808/-

3 INTEREST ON LOANS:

The management has decided not to charge any interest on loans advanced to subsidiaries/Associates of the Company and also not to pay interest on loans taken from Subsidiaries/Associates/Directors of the Company.

4 CASH FLOW STATEMENT:

The cash flows are reported using the indirect method, whereby net profit after tax is adjusted for the effects of transactions of noncash nature and any deferrals or accruals of past or future cash receipts or payments. The cash flows from operating, investing and financing activities of the company are segregated.

5 OTHER INFORMATION: Director Remuneration (Value in Rs.)

Nature 2013-14 2012-13 Rs. Rs.

Mr.R.S.Ramani NIL NIL



Nature 2013-14 2012-13 Rs. Rs.

Statutory Audit - Net of Service Tax 1,10,000 70,000

Tax Audit - Net of Service Tax 20,000 20,000

Taxation matters 20,000 20,000

6 DETAILS OF CAPACITY AND PRODUCTION:

The company is into Information Technology Software Services, which cannot be expressed in any generic unit. As the company is not into manufacture / production of any product, data relating to capacity and production is not relevant and hence not provided.

7 DEBTORS & CREDITORS:

Confirmation of balances for receivables and payables are yet to be obtained.

8 PREVIOUS YEAR FIGURES:

Figures for the prior year have been regrouped, recast or rearranged to conform to the current year''s classification.

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Mar 31, 2013

1.1 RELATED PARTY DISCLOSURES:

1. Relationships Category – I – Major shareholders in the company:

- Mr. Suresh Venkatachari - 59.10%

- Mr.R.S.Ramani - 6.56%

Category – II – Subsidiaries and Associates of the company.

- Mentor minds solutions and Services Inc (USA) -100% subsidiary company

- Mentor minds solutions and Services Pvt Ltd-100% subsidiary company

- 8k miles Software Services Inc (USA) -100% subsidiary company

- 8k miles Software Services (FZE) (UAE) -100% subsidiary company

Category – III – Other parties where common control exists.

- 8k Miles Web Services Private Limited - No.7, 3rd floor, Ganapathy Colony 3 rd street, Teynampet, Chennai – 600018.

- 8k Miles Inc(USA). – 3525, Quaker bridge road, Suite 1600, Hamilton, NJ 08619, USA

- Vinoosh Foods and Entertainment Private Limited - No.7, 3rd floor, Ganapathy Colony 3rd street, Teynampet, Chennai – 600018.

Category – IV – Key Managerial Personnel:

- Mr. Suresh Venkatachari, Director, No. 24, GA Rahul Apartments, Cenatoph Road 1st Street, Teynampet, Chennai – 600 018

- Mr.R.S.Ramani, Director, SubaGruham, No. 364-B, 5th Main Road, Vijaya Nagar, Velacherry, Chennai - 600042,

- Mr. M.V.Bhaskar, Director, 13/219,42nd Street, 8th Sector, KK Nagar, Chennai -600078.

- Ms.T.P.Saira, Director, Old No.15 New No.6 II Cresent Park Street, Gandhi Nagar, Adyar, Chennai – 600020.

Category – V – Relatives of Key Managerial Personnel:

- There is no relationship exists among Key Management Personnel.

2. Transactions with related parties:-

Category – I – Major shareholders in the company:

Loan Received from Directors:

- Mr. Suresh Venkatachari : Rs.59,36,075/-.

- Mr.R.S.Ramani: Rs.6,59,065/-.

Category – II – Subsidiaries and Associates of the company.

8k miles Software Services INC (USA) :

Amount recd. against invoices raised: US$ 286809 (Rs.15511290) Amount invested in share capital: US$ 1000 (Rs.45220). Outstanding Receivable as on 31st March 2013: Rs.32,04,045/-

8k miles Software Services FZE (UAE):

Amount invested in share capital: AED150000 (Rs.18, 40,500).

Mentor Minds Solutions Services Inc:

Amount invested in share capital: Rs.11,50,11,500. Outstanding receivable as on 31st March 2013: Rs.26,54,969/-

Mentor Minds Solutions and Services Pvt Ltd:

Amount invested in share capital: Rs. 11,50,11,500/- Outstanding Receivable as on 31st March 2013: Rs.100,36,745.

Category – III – Other parties where common control exists.

8k Miles Software Services Singapore

Amount Received against invoices raised: Rs.1565762. Outstanding Payable as on 31st March 2013: Rs.699/-

8k Miles Web Services Private Limited

Consideration payable for business purchased outstanding as on 31st March 2013 – Rs.1,29,06,783/-

8k Miles INC (USA)

Consideration payable for business purchased outstanding payable as on 31st March 2013 – Rs.7,40,00,000/-

1.2 INTEREST ON LOANS:

The management has decided not to charge any interest on loans advanced to subsidiaries/Associates of the Company and also not to pay interest on loans taken from Subsidiaries/Associates/Directors of the Company.

1.3 CASH FLOW STATEMENT:

The cash flows are reported using the indirect method, whereby net profit after tax is adjusted for the effects of transactions of noncash nature and any deferrals or accruals of past or future cash receipts or payments. The cash flows from operating, investing and financing activities of the company are segregated.

1.4. DETAILS OF CAPACITY AND PRODUCTION:

The company is into Information Technology Software Services, which cannot be expressed in any generic unit. As the company is not into manufacture / production of any product, data relating to capacity and production is not relevant and hence not provided.

1.5 DEBTORS & CREDITORS:

All balances of receivables and payables are subject to confirmation.

1.6 PREVIOUS YEAR FIGURES:

Figures for the prior year have been regrouped, recast or rearranged to conform to the current year’s classification.

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Mar 31, 2012

1 - CONTINGENT LIABILITIES AND COMMITMENTS (TO THE EXTENT NOT PROVIDED FOR)

Particulars AS at 31 March As at 31 March 2012 2011

(A) Contingent Liabilities (a) Claims aqainst the company not acknowledged as debts (b) Guarantees (c) Other money for which company is contingently liable

Bills discounted with banks

Total(A)

(B) Commitments (a) Estimated amount of contracts remaininq to be executed on capital account and not provided for (b) Uncalled liability on shares and other investments partly paid (c) Others

The company had provided for Rs.6,53,089/- as Minimum alternate tax for the Ay 2011-12. Notice of Demand under Income Tax Act, 1961 of Rs.11,90,670/- for the AY 2011-12 has been received and the Company has preferred a representation before the incometax Authorities. No provision has been made in the books of account for the difference amount as the Company has brought forward losses available to set off.The Company has not paid any amount of tax relating to AY 2011-12. 537,581

Total(B). 537,581

TOTAL [(A) (B)] 537,581



2 - DUES TO SMALL AND MEDUIM ENTERPRISES

The company has not received any memorandum (as required to be filed by the suppliers with notified authority under the Micro, Small and Medium Enterprises Development Act 2006) claiming their status as micro, small or medium enterprises. Consequently the amount paid/payable to these parties during the year is Rs. Nil.

3 BACKGROUND

8k Miles Software Services Limited ("the Company") was incorporated in 1993 in the name of Rosebuds Commercials Limited and the company's name was subsequently changed to P.M. Strips Limited in March 2009. The Main object of the Company is to enable outsourcing of software and other knowledge services completely over the internet. The company provides the people, hardware, software and tools required for outsourcing on-demand effectively enabling a non cap-ex model of "Software development".

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Mar 31, 2010

A. NOTES TO ACCOUNTS 31.03.2010 31.03.2009 Rs. Rs.

1. Contingent liabilities not provided for

a) Cases pending against the company in the High Court of Andhra Pradesh against Sales Tax Orders

2. Directors Remuneration

a) Salary Nil Nil

b) Perquisites Nil Nil

3. Details of Capacity and Production

As there is no production during the year, the relevant data is not relevant

4. The Debtors & Creditors are not reconciled or confirmed. Confirmations have been sent to parties and no confirmation has been received till now.

5. Deferred Tax resulting from timing differences between Book Profits and Tax Profits is accounted for under the liability method, at the current rate of tax. to the extent that the timing differences are expected to crystallise.

6. As the Company is not a multi-product company, segmentation as required by AS- 17 'Segment Reporting' issued by the Institute of Chartered Accountants of India. in respect of product is not applicable.

7. Related Party Disclosures - As required by AS-18 are as: (a) Relationships:

Category -1 - Major shareholders in the Company -Promoters' family

Category - II - Subsidiaries and Associates of the Company -

None.

Category - III -Other related parties where common control exists.

Kaveri (India) Ltd.,Regd. Office:1-7-241/11/D,S.D.Road, Secunderabad-3.

Golconda Engg. Entp.Ltd.,Regd. Office:1-7-241/11/D,S.D.Road, Secunderabad-3.

Surana Securities Ltd.,Regd. Office:1-7-241/11/D,S.D.Road, Secunderabad-3.

P.M.Telelinnks Ltd. (Formerly Surana Strips Ltd.),

Regd. Office:1-7-241/11/D,S.D.Road, Secunderabad-3.

Surana Steels Ltd. Regd. Office:1-7-241/11/D,S.D.Road, Secunderabad-3.

P.M.Telecom,1-7-241/11/D,S.D.Road, Secunderabad-3.

Surana Udyogjth floor, 1-7-241/11/D,S.D.Road, Secunderabad-3.

Category - IV- Key Managerial Personnel - Sri GP.Surana, Dtrector,19 P & T Colony,

Secunderabad.

Sri Ravi Surana, Director, 19 P & T Colony, Secunderabad.

Category - V- Relatives of Key Managerial Personnel - Sri G.P.Surana, Father of Ravi Surana and Drpin Surana. 19, P & T Colony, Secunderabad. (b) Transactions with related parties: - Category -1 - Major shareholders in the Company- None.

Category - II - Subsidiaries and Associates of the Company -

None.

8. The management has decided not to charge any interest on loans advanced to sister concerns and also not to pay any interest :

On loans taken from sister concerns.

9. Previous year figures have been regrouped/rearranged wherever necessary. Signatures to Schedules 1 to 18

As per our report of even date attached.

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Mar 31, 2009

Not Available