Accounting Policies of Toss the Coin Ltd. Company

Mar 31, 2025

Note 1 & 2 : Significant Accounting Policies and Notes on Accounts Corporate Information

The Company is a Small and Medium Enterprise (SME) providing technical design, drafting, and documentation support services to business clients overseas. Its revenue is primarily export-based, billed in foreign currency.

During the year, the Company successfully completed an Initial Public Offering (IPO) and its equity shares were listed on an SME exchange in India. The financial statements for the year ended March 31, 2025 have been prepared for the first time as a listed company, in accordance with the applicable financial reporting framework described below.

Basis of Preparation of Financial Statements

The financial statements are prepared on the historical cost convention and accrual basis of accounting, in accordance with the Generally Accepted Accounting Principles in India (Indian GAAP). These statements comply with the applicable Accounting Standards notified under the Companies (Accounting Standards) Rules and the relevant provisions of the Companies Act, 2013. The Company has presented the financial statements as per the format prescribed under Schedule III -Division I of the Companies Act, 2013 (applicable to non-Ind AS companies).

All assets and liabilities have been classified as current or non-current as per the Company''s normal operating cycle and other criteria set out in Schedule III. The operating cycle for the Company''s business (technical services) is considered to be 12 months. All figures are presented in Indian Rupees (INR) and have been rounded off to the nearest hundreds, unless otherwise stated.

Use of Estimates and Judgments

The preparation of financial statements requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, income, and expenses. Key areas involving critical estimates include useful lives of depreciable assets, impairment assessments, employee benefit obligations, taxes, provisions, etc. Actual results could differ from these estimates. Management reviews estimates periodically and appropriate changes are made to the accounting policies or reported amounts in the period in which the revisions are known. Any material changes in estimates are disclosed in the notes to the financial statements.

Revenue Recognition Service Revenue:

The Company''s revenue comprises income from technical design, drafting, and documentation support services provided to clients. Revenue from rendering of services is recognized as and when the services are rendered, and where applicable, when related costs are incurred, in accordance with the terms of the contracts with clients. This generally corresponds to recognition on a proportionate completion basis or as per the achievement of performance milestones, since the service contracts are primarily time-based or deliverable-based. Revenue is recognized only when it is probable that the economic benefits will flow to the Company and the amount of revenue can be measured reliably, and there is no significant uncertainty regarding collection. Export sales (services provided to overseas clients) are initially recorded at the exchange rate on the date of the transaction. Amounts billed to clients are exclusive of any indirect taxes (e.g. GST) as applicable, since export services are usually zero-rated for GST.

Interest Income:

Interest income (for example, on bank deposits or other financial assets) is recognized on a time-proportion basis using the effective interest rate method, considering the amount outstanding and the applicable interest rate. This ensures that income is recognized on a accrual basis over time, in line with the underlying instrument''s terms.

The Company''s business does not involve sale of goods; hence revenue primarily consists of service income. There are no other significant operating revenues. Any other income, such as income from export incentives or miscellaneous services, is accounted for on accrual basis when the right to receive the income is established and no significant uncertainty exists.

Foreign Currency Transactions and Translation

Since a substantial portion of the Company''s revenue is denominated in foreign currency, the following policies are applied for foreign currency transactions in accordance with Accounting Standard (AS) 11:

• Initial Recognition: Foreign currency transactions (income, expenses, assets or liabilities denominated in a currency other than the Company''s functional currency, INR) are recorded in the books at the exchange rate prevailing on the date of the transaction. For practical purposes, an approximate rate that reflects the actual rate on the date (such as an average rate for the week or month in which the transaction occurs, if rates do not fluctuate significantly) may be used.

• Conversion at Year-End: Monetary items (such as foreign currency denominated receivables, payables, bank balances) outstanding as at the Balance Sheet date are translated at the closing exchange rate (the rate prevailing on the balance sheet date). Non-monetary items (such as fixed assets, intangible assets, or investments) that are carried at historical cost are reported using the exchange rate on the date of the initial transaction and are not subsequently revalued.

• Exchange Differences: Exchange differences arising on settlement of foreign currency transactions, or on translation of monetary assets and liabilities at the year-end rates, are recognized as income or expense in the Statement of Profit and Loss in the period in which they arise. For example, any gain or loss on realization of export receivables due to exchange rate fluctuation is recorded in the period of realization as part of other income or finance costs (as applicable).

• Forward Contracts: The Company may enter into forward exchange contracts or other derivative contracts to hedge foreign exchange exposure. Such contracts, if not intended for trading or speculative purposes, are accounted for as follows:

o The premium or discount on the forward contract (i.e. the difference between the forward rate and the spot rate on the date of the contract) is amortized as expense or income over the life of the contract. The exchange differences on the forward contract are recognized in the Statement of Profit and Loss in the reporting period along with the exchange differences on the underlying item. Any profit or loss arising on cancellation or renewal of forward exchange contracts is also recognized in the Statement of Profit and Loss. (Derivative contracts not intended as hedges or that do not qualify for hedge accounting are marked-to-market and resulting losses are charged to income; gains, if any, are ignored per prudence principle.)

Property, Plant and Equipment (PPE)

Recognition and Measurement: Property, Plant and Equipment are stated at cost of acquisition or construction, less accumulated depreciation and impairment losses, if any. Cost includes purchase price and any directly attributable costs to bring the asset to its working condition for its intended use (such as freight, duties and taxes

net of tax credits, installation expenses, site preparation costs, professional fees for architects/engineers for building construction, etc.). Subsequent expenditures related to PPE are capitalized only if they increase the future economic benefits from the asset beyond its previously assessed standard of performance. Borrowing costs directly attributable to the acquisition or construction of qualifying assets (that necessarily take a substantial period of time to get ready for intended use) are capitalized as part of the cost of that asset, as described in the Borrowing Costs policy. Other repairs and maintenance costs, which do not add to the asset''s utility or longevity, are charged to the Statement of Profit and Loss as incurred.

Capital Work-in-Progress:

Assets in the course of construction or development (if any) are carried at cost as Capital Work-in-Progress until they are ready for their intended use, at which point they are capitalized as PPE. No depreciation is charged on capital work-in-progress.

Depreciation

Depreciation on PPE is provided on a systematic basis over the useful life of the asset, reflecting the manner in which the asset''s economic benefits are consumed by the Company. The Company provides depreciation on its tangible assets using the straight-line method (SLM) over the estimated useful lives of the assets. These useful lives are in line with those prescribed in Schedule II to the Companies Act, 2013, unless a different useful life is justified on technical evaluation.

• Depreciation is charged on a pro-rata basis from the date the asset is available for use (i.e., when it is in the location and condition necessary for it to operate as intended) until the date the asset is disposed or de-recognized.

• The residual value, useful life, and depreciation method of PPE are reviewed at each financial year-end and adjusted if expectations differ from previous estimates. Any change in estimate is accounted for prospectively over the remaining useful life of the assets.

• Individual assets costing less than Rs. 5,000 are depreciated at 100% in the year of purchase (i.e., fully expensed in the year of acquisition), as permitted by Schedule II, since such assets are not material individually.

Depreciation on additions to assets or on disposals during the year is provided on a pro-rata basis according to the period of use. When assets are sold or retired, their cost and accumulated depreciation are removed from the financial statements, and any resulting gain or loss is included in the Statement of Profit and Loss for that period.

Intangible Assets

Recognition and Measurement: Intangible assets (if any) are stated at cost of acquisition (or development) less accumulated amortization and impairment losses. Intangible assets include identifiable non-monetary assets without physical substance, such as software licenses, patents, copyrights or technical know-how, that are expected to provide future economic benefits to the Company. Internally generated intangible assets (like development costs) are recognized if they meet the criteria under AS 26 (for example, technical feasibility, intention and ability to use, probable future benefits, etc.); otherwise, such research and development expenditures are charged to the Profit and Loss as incurred.

Amortization: Intangible assets are amortized on a straight-line basis over their estimated useful lives, which are determined based on the nature of the asset and the expected benefit period, subject to a maximum of 10 years as per AS 26 (if the useful life cannot be reliably estimated, it is taken as 10 years). For instance, computer software is amortized over a period of 3 years (reflecting its typically short life cycle), unless a longer or shorter period is more appropriate based on expected usage or contractual rights. Amortization begins when the asset is available for use and continues until the asset is fully amortized or retired. The amortization period and method are reviewed at each year-end and adjusted if required on a prospective basis.

Impairment of Assets

The Company assesses at each balance sheet date whether there is any indication that a tangible or intangible asset may be impaired (i.e., its carrying amount may not be fully recoverable). Indicators include factors like significant decline in market value, obsolescence or physical damage, adverse changes in industry or economic conditions, or continuous underperformance of the asset. If any such indication exists, the Company estimates the asset''s recoverable amount.

• Recoverable amount is the higher of an asset''s net selling price (fair value less costs to sell) and its value in use (present value of future cash flows expected to arise from continued use of the asset and its disposal at end of life). The evaluation is done on an individual asset basis or, if the asset does not generate largely independent cash flows, on the cash-generating unit (CGU) to which the asset belongs.

• If the carrying amount of an asset (or CGU) exceeds its recoverable amount, an impairment loss is recognized for the difference. Impairment losses are charged to the Statement of Profit and Loss in the period in which the impairment is identified.

• After recognition of an impairment loss, the depreciation/amortization charge for the asset is adjusted in future periods to allocate the asset''s revised carrying amount (less any residual value) over its remaining useful life.

• If there is a subsequent increase in recoverable amount of an asset (other than goodwill) that was previously impaired, the previously recognized impairment loss is reversed to the extent of the increase in recoverable amount, but not exceeding the carrying amount that would have been determined (net of depreciation/amortization) had no impairment loss been recognized for the asset in prior years. Such reversal of impairment loss is recognized in the Statement of Profit and Loss. (Impairment losses on goodwill, if any, are not reversed.)

Leases

The Company''s policy on accounting for leases is in accordance with AS 19 -Leases.

Leases of assets are classified as either finance leases or operating leases based on

the extent to which risks and rewards of ownership of the asset lie with the Company

(lessee) or with the lessor, at the inception of the lease.

• Finance Leases: Leases that transfer substantially all the risks and rewards of ownership to the Company are classified as finance leases. In such cases, the Company capitalizes the leased asset as an asset on its Balance Sheet and a corresponding lease liability is recorded. The asset is recorded at the lower of (a) the fair value of the leased asset at the inception of the lease, and (b) the present value of the minimum lease payments over the lease term. The asset is depreciated over its expected useful life on the same basis as owned assets (or over the lease term, if shorter, if ownership is not expected to transfer to the Company at the end of the lease). The finance charge (interest element) in the lease payment is recognized as finance cost in the Statement of Profit and Loss over the lease term so as to produce a constant periodic rate of interest on the remaining balance of the liability.

• Operating Leases: Leases in which a significant portion of the risks and rewards of ownership are retained by the lessor (i.e. not substantially transferred to the lessee) are classified as operating leases. Lease payments under an operating lease are recognized as expense in the Statement of Profit and Loss on a straightline basis over the lease term (unless the payments are structured to increase in line with expected general inflation or another systematic basis is more representative of the time pattern of benefit). For example, office premises and equipment taken on cancellable short-term leases are treated as operating leases, and rentals are charged to expense as incurred.

Investments

Investments are classified into current and long-term investments based on management''s intent at the time of purchase. Long-term investments are those which are intended to be held for more than one year from the date of acquisition (or are strategic in nature), whereas current investments are those which are intended to be held for not more than one year, and are typically held for the purpose of being readily converted into cash to meet short-term needs.

• Long-term investments (such as investments in bonds, or securities of other companies) are carried at cost. However, if there is a decline in the value of a long-term investment, other than temporary in nature, the carrying amount is written down to the revised value to recognize the loss. The determination of "other than temporary" diminution is made by considering factors such as the extent and duration of the decline, the financial health and near-term prospects of the issuer, and the intent/ability of the Company to retain the investment for a period sufficient to allow for any anticipated recovery. Any reduction in carrying amount is charged to the Statement of Profit and Loss. If the value of such investments subsequently appreciates and the appreciation is objectively related to an event occurring after the impairment was recognized, the increase is not reversed in the accounts (consistent with prudence).

• Current investments (such as investments in mutual funds, short-term debt instruments, etc. that the Company intends to liquidate within a year) are carried at the lower of cost and fair value on an individual investment basis. Fair value for quoted investments is the market price (closing price on stock exchange or net asset value in case of mutual funds) at the reporting date, and for unquoted instruments is determined based on appropriate valuation techniques. If the fair value is lower than the carrying cost, the difference is recognized as a provision for diminution in value and charged to the Statement of Profit and Loss. Any reduction in carrying value is reversed when the fair value rises subsequently, to the extent of the original cost.

On disposal of an investment, the difference between the carrying amount and the net sale proceeds is recognized in the Statement of Profit and Loss as gain or loss on investment. Interest earned on bonds or deposits, and dividends earned on investments in shares, are recognized as income in accordance with the Revenue Recognition policy (i.e., interest on time-proportion basis, dividends when the right to receive is established).

Employee Benefits

The Company''s employee benefit schemes are accounted for in accordance with Accounting Standard (AS) 15 -Employee Benefits. The significant employee benefits and related accounting policies are as follows:

• Short-Term Employee Benefits: Short-term benefits are those expected to be settled wholly before twelve months after the end of the period in which employees render the related service. This includes salaries, wages, bonus, incentives, short-term compensated absences (like paid annual leave which is expected to be availed or encashed within 12 months), and other allowances. Short-term employee benefit obligations are recognized as an expense in the Statement of Profit and Loss in the period in which the related service is rendered. Liabilities for short-term benefits (like accrued salary, bonus, or unused leave that is expected to be encashed within the year) are measured on an undiscounted basis at the amounts expected to be paid.

• Defined Contribution Plans: Contributions to defined contribution schemes such as Provident Fund and other social security funds are recognized as expense when due, since the Company has no further obligation beyond making the contributions. The Company contributes to the government-administered provident fund on behalf of its employees as per the prescribed laws and regulations. This provident fund plan is a defined contribution plan, as the Company does not carry any further obligations beyond the periodic contributions. The Company''s contributions to provident fund are charged to the Statement of Profit and Loss in the year to which they relate. Similarly, contributions to employee state insurance (ESI) or pension schemes (if applicable) are treated as defined contribution plans and expensed when accrued.

• Defined Benefit Plans (Gratuity): The Company''s gratuity plan (a lump-sum payment to employees on separation from the company, based on last drawn salary and years of service, as per the Payment of Gratuity Act) is an unfunded defined benefit plan. The cost of providing benefits under this plan is determined using the Projected Unit Credit (PUC) actuarial method. The Company obtains an

actuarial valuation annually, as at the balance sheet date, to measure the present value of the gratuity obligation. Actuarial gains and losses (re-measurements arising from changes in actuarial assumptions or experience adjustments) are recognized in full in the Statement of Profit and Loss for the period in which they occur. The obligation recognized in the balance sheet represents the present value of the defined benefit obligation. Past service cost (if any, arising from plan amendments or curtailments) is recognized immediately to the extent that the benefits are already vested, and otherwise is amortized on a straight-line basis over the average period until the benefits become vested. Since the gratuity scheme is unfunded, there are no plan assets to offset the liability. The expenses for gratuity include the service cost (current and past, if any), interest cost (unwinding of discount on the obligation), and any actuarial gains or losses recognized.

• Other Long-Term Employee Benefits (Leave Encashment): The Company provides for earned leave benefits which can be carried forward (accumulating compensated absences) and availed or encashed by employees in future periods. Leave encashment obligations that are long-term in nature (that is, not expected to be wholly settled within 12 months after the end of the period in which employees render the related service) are treated as other long-term employee benefits. The liability for such leave is also actuarially determined (typically using the Projected Unit Credit method) at each balance sheet date. Actuarial gains and losses on long-term leave obligations are recognized in the Statement of Profit and Loss in the period in which they arise. On the other hand, leave encashment benefits that are expected to be settled fully within 12 months (for example, if the company''s policy requires mandatory encashment of unused leave at year-end or if leaves do not carry forward beyond the year) are classified as short-term benefits and are not discounted -the expense is recognized based on the amount of leave expected to be encashed, as the employees render service that gives them the entitlement.

• Termination Benefits: If the Company were to incur obligations for termination benefits (e.g., as part of a redundancy or voluntary retirement scheme), those would be recognized at the earlier of when the Company can no longer withdraw the offer of such benefits and when the Company recognizes costs for a restructuring that involves the payment of termination benefits. (As of the reporting date, no termination benefit scheme is in place.)

Each year, the management reviews the adequacy of the provisions for all employee benefit obligations and makes adjustments if necessary based on actuarial advice or other current information. The expenses related to defined benefit and other long-term plans are presented in the financial statements under "Employee Benefits Expense." Disclosures as required by AS 15 (such as the actuarial assumptions, defined benefit obligation movements, etc.) are provided in the notes to accounts.

Borrowing Costs

Borrowing costs consist of interest and other costs (such as finance charges in respect of finance leases, exchange differences to the extent regarded as an adjustment to interest costs, and other ancillary costs) that an entity incurs in connection with the borrowing of funds. Accounting for borrowing costs is done in accordance with AS 16 -Borrowing Costs:

• Capitalization of Borrowing Costs: Borrowing costs that are directly attributable to the acquisition, construction or production of a qualifying asset are capitalized as part of the cost of that asset. A qualifying asset is one that necessarily takes a substantial period of time (generally, 12 months or more) to get ready for its intended use or sale. Examples might include construction of a new office building or development of certain large software projects. The capitalization of borrowing costs as part of the cost of a qualifying asset commences when (a) expenditures for the asset are being incurred; (b) borrowing costs are being incurred; and (c) activities that are necessary to prepare the asset for its intended use or sale are in progress. Capitalization continues until the asset is substantially ready for use or sale.

• Suspension and Cessation: Capitalization of borrowing costs is suspended during extended periods in which active development of the asset is interrupted. Capitalization ceases when substantially all the activities necessary to prepare the qualifying asset for its intended use or sale are complete, or if the development is abandoned.

• Other Borrowing Costs: Borrowing costs other than those eligible for capitalization (primarily, borrowing costs on short-term funds or on long-term funds when no qualifying asset is being developed) are recognized as an expense in the period in which they are incurred. For instance, interest on working capital loans used for day-to-day operations or on borrowings used to finance dividend payments, etc., is charged to the Statement of Profit and Loss as it accrues.

• In the current financial year, the Company has not constructed any qualifying asset; hence, all borrowing costs (primarily interest on bank credit facilities) have been expensed as incurred. If in future years the Company undertakes projects requiring substantial construction periods financed by specific borrowings, the policy above will be applied and such costs will be capitalized to the extent appropriate.

Taxation (Current and Deferred Tax)

Income-tax expense comprises current tax and deferred tax. It is recognized in the

Statement of Profit and Loss,.

• Current Tax: Current tax is the amount of income tax payable on the taxable profit for the year as determined in accordance with the provisions of the Income Tax Act, 1961. Taxable profit may differ from the profit as reported in the Statement of Profit and Loss due to differences in recognition principles between tax laws and accounting standards (such as depreciation rates, disallowances of certain expenses, etc.). Current tax is calculated using the applicable tax rates and tax laws enacted or substantively enacted as of the reporting date. Any adjustments to tax payable in respect of previous years (for example, due to assessments or tax disputes settled) are recognized in the year in which the outcomes are determined. The Company also evaluates any available tax incentives or exemptions (like benefits for export profits or deductions for employment of new employees under Section 80JJAA, etc.) in determining the current tax liability. Minimum Alternate Tax (MAT), if applicable, is accounted for and credit is recognized as an asset only if there is convincing evidence of recoverability of MAT credit against normal tax in future years.

• Deferred Tax: Deferred tax is accounted for using the liability method on temporary differences between the carrying amounts of assets and liabilities in the financial statements and their corresponding tax bases. Deferred tax liabilities (DTLs) are generally recognized for all taxable temporary differences. Deferred tax assets (DTAs) are recognized for deductible temporary differences, carry-forward of unused tax losses, and carry-forward of unabsorbed depreciation to the extent there is reasonable certainty that sufficient future taxable income will be available against which such deferred tax assets can be realized. However, where the Company has carry-forward losses or unabsorbed depreciation, deferred tax assets are recognized only if there is virtual certainty, supported by convincing evidence, of realization of such assets. This stricter criterion (virtual certainty) is applied in loss situations in accordance with AS 22. The carrying amount of deferred tax assets is reviewed at each balance sheet date and reduced to the extent it is no longer reasonably certain (or virtually certain, as applicable) that the related tax benefit will be realized; likewise, unrecognized deferred tax assets are reassessed and recognized to the extent that it becomes reasonably certain (or virtually certain) that sufficient future taxable profits will allow the DTA to be recovered.

• Deferred tax assets and liabilities are measured at the tax rates that have been enacted or substantively enacted by the balance sheet date and are expected to apply when the related temporary differences reverse. Deferred tax is charged or credited to the Statement of Profit and Loss, except for deferred tax arising from adjustments to equity (for instance, deferred tax on share issue expenses that are charged directly to securities premium, if any -such deferred tax is also adjusted in equity). In the Balance Sheet, DTA and DTL are offset if they relate to taxes on income levied by the same governing taxation laws and the Company has a legally enforceable right to set off current tax assets and liabilities.

Provisions, Contingent Liabilities and Contingent Assets

Provisions are recognized in accordance with AS 29 -Provisions, Contingent Liabilities and Contingent Assets when the Company has a present legal or constructive obligation as a result of a past event, it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation, and a reliable estimate can be made of the amount of the obligation. The amount recognized as a provision is the best estimate of the expenditure required to settle the present obligation at the Balance Sheet date, taking into account the risks and uncertainties surrounding the obligation. Provisions are discounted to their present value if the effect of the time value of money is material, using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the liability. The unwinding of the discount is recognized as finance cost. Examples of situations requiring provisions include litigations, warranties on services (if any contractual obligation for rework or penalties), and other claims where the conditions of AS 29 are met.

When some or all of the expenditure required to settle a provision is expected to be reimbursed by another party (for example, under an insurance contract or a subcontractor''s responsibility), the reimbursement is recognized as a separate asset only when it is virtually certain that reimbursement will be received if the Company settles the obligation. In the Statement of Profit and Loss, the expense relating to a provision may be presented net of the reimbursement.

If the Company has an onerous contract (where the unavoidable costs of meeting the obligations under the contract exceed the economic benefits expected to be received), a provision is recognized for the lower of the cost of fulfilling the contract and any compensation or penalties arising from failure to fulfill it.

Contingent Liabilities: A contingent liability is a possible obligation that arises from past events and whose existence will be confirmed only by the occurrence or nonoccurrence of one or more uncertain future events not wholly within the control of the Company; or it is a present obligation that arises from past events but is not recognized because (a) it is not probable that an outflow of resources will be required to settle the obligation, or (b) the amount of the obligation cannot be measured with sufficient reliability. Contingent liabilities are not recognized in the accounts, but are disclosed by way of a note to the financial statements, unless the possibility of an outflow of resources is remote. The disclosure includes an estimate of the financial effect, uncertainties relating to the amount or timing, and the possibility of any reimbursement. Common examples of contingent liabilities for the Company might include pending legal disputes or claims, guarantees given to third parties, etc., which are disclosed unless the chance of loss is remote.

Contingent Assets: Contingent assets (possible assets that arise from past events and whose existence will be confirmed only by the occurrence or non-occurrence of uncertain future events not wholly within the control of the Company) are not recognized in the financial statements, since this may result in the recognition of income that may never be realized.

However, when the realization of income is virtually certain (for instance, a favorable judgment in a lawsuit where the time for appeal has lapsed and the counterparty has the ability to pay), the related asset is not considered contingent and is recognized as an asset. Until then, contingent assets are disclosed in the financial statements where an inflow of economic benefits is probable, but not virtually certain.

Earnings Per Share (EPS)

The Company reports basic and diluted earnings per share in accordance with AS 20 -Earnings Per Share for each period for which a Statement of Profit and Loss is presented.

• Basic Earnings Per Share: Basic EPS is calculated by dividing the net profit or loss for the period attributable to equity shareholders (after deducting any dividends on preference shares, if any for the period) by the weighted average number of equity shares outstanding during the period. The weighted average number of shares is calculated taking into account the timing of any new share issues (including the shares issued in the IPO) or buybacks during the period, weighted by the portion of the period they were outstanding. In the current year, the equity shares issued during the IPO have been included in the weighted average count from the date of their issue. Basic EPS reflects the actual equity structure in terms of issued shares during the period.

• Diluted Earnings Per Share: Diluted EPS adjusts the figures used in the determination of basic EPS to take into account: (a) the after-tax effect of any interest or other financing costs associated with dilutive potential equity shares, and (b) the weighted average number of additional equity shares that would have been outstanding assuming the conversion of all dilutive potential equity shares. Dilutive potential equity shares could include convertible debentures, stock options, warrants, etc. (if any are outstanding). For the purpose of calculating diluted EPS, the net profit for the period attributable to equity shareholders and the weighted average number of shares are adjusted for the effects of all dilutive potential equity shares. If there are no dilutive instruments outstanding (as is the case for the Company in the reporting period), the diluted EPS is the same as basic EPS. All EPS figures are rounded to the nearest two decimal places as required by the Schedule III norms.

• The Company had a change in its capital structure during the year due to the IPO. As required, EPS for the previous year (FY 2023-24) has been restated for the bonus element in the issue, if any, or adjusted to make it comparable, in accordance with AS 20. Appropriate disclosures of the EPS computations are provided in the notes.)

Cash Flow Statement

The Cash Flow Statement has been prepared pursuant to the provisions of the Companies Act and in accordance with AS 3 -Cash Flow Statements. The Company has used the indirect method to present cash flows from operating activities, whereby profit before tax is adjusted for the effects of non-cash transactions, any deferrals or accruals of past or future operating cash receipts or payments, and items of income or expense associated with investing or financing cash flows. Cash flows are segregated into Operating, Investing, and Financing activities for presentation.

Cash and cash equivalents (for the purpose of the Cash Flow Statement) comprise cash on hand, balances in current accounts with banks, and other short-term highly liquid investments (such as bank deposits or money market instruments) with original maturities of three months or less, that are readily convertible into known amounts of cash and subject to insignificant risk of change in value.

Segment Reporting

The Company operates in a single business segment -providing technical design and documentation support services -and primarily caters to clients in overseas markets. In the context of AS 17 (Segment Reporting), the Company''s business and geographical operations are considered as one reportable segment, as the risks and returns are predominantly similar. Hence, no separate segment information is provided in the financial statements. The Company''s Chief Operating Decision Maker (CODM) reviews the financial results at an overall company level, and therefore, for management reporting purposes, the Company is considered to be engaged in one segment. However, certain secondary segment information (e.g., revenue by location of customers) is disclosed as required, since the Company earns a substantial portion of revenue from exports. If in the future the Company diversifies into multiple lines of business or significantly different geographic regions, it will present segment information accordingly in the financial statements.

Share Capital and IPO-related Costs

Share Capital: Equity share capital is recorded at the face value of shares issued. Any premium received over the face value (issue price minus face value) on issuance of equity shares is recorded in the Securities Premium Account. Retained earnings represent accumulated profits and are shown under shareholders'' equity. If the Company issues any preference shares or other equity instruments, these will be classified in equity or liabilities according to the substance of the contractual arrangement (in the current year, the Company has only one class of equity shares).

Share Issue Expenses: Expenses incurred in connection with the issue of new equity shares (such as IPO-related expenses including underwriting fees, merchant banker fees, legal and compliance costs, listing fees attributable to the new issuance, printing and advertisement expenses for the issue, etc.) are accounted as share issue expenses. In accordance with Section 52 of the Companies Act, 2013, share issue expenses are adjusted against the Securities Premium Account (utilized from the premium collected on the IPO) to the extent of available balance. Such adjustment is made net of any tax benefits (if applicable). This accounting treatment is permitted as these costs are considered directly attributable to the equity transaction (issuance of

new shares). In the current year, the Company has adjusted the eligible IPO expenses against the securities premium raised through the public issue.

Listing and Other IPO Costs: Not all costs associated with an IPO are directly attributable to share issuance. Costs that are primarily related to listing the existing shares or regulatory compliance (for example, general listing fees for the stock exchange, post-listing compliance costs, roadshow and marketing costs which promote the Company rather than the issuance, etc.) are expensed to the Statement of Profit and Loss as "IPO / Listing Expenses" in the year they are incurred. This distinction is made because share issue costs benefit the equity holders and are a deduction from equity, whereas other IPO-related costs are period expenses.

The Company has provided detailed disclosures of the total IPO proceeds, utilization of proceeds, and a break-up of expenses incurred on the IPO (indicating how much was adjusted against securities premium and how much charged to P&L) in the notes to accounts, as required for the first financial statements after the public issue.

The proceeds of IPO have been utilized till March 31, 2025 as per the below mentioned table:

				Unutilised
		Amt.		Amt. (? in
S.No	Particulars	(? in Lakhs)	Utilised	Lakhs)
	Funding capital expenditure for
1	Development of Microservices Application	294.73	28.86	265.87
2	Funding capital Expenditure for opening new Offices	120.00		120.00
3	Funding Working Capital Requirement of our Company	200.00		200.00
4	General Corporate Expenses	217.55		217.55
5	Public Issue Related Expenses	85.00	85.00	0.00
	Net Issue Proceeds	917.28	113.86	803.42

Related Party Transactions

Disclosure of related party relationships and transactions is made in the notes to accounts as per the requirements of AS 18 -Related Party Disclosures. The Company''s related parties include its directors, key managerial personnel, entities over which the above persons have significant influence, etc. However, since disclosure of related party transactions is not an accounting policy but rather a factual note, the details are presented separately in the financial statements and not repeated here in the summary of significant accounting policies.

Previous Year Figures

The financial statements (including these policies and accompanying notes) present figures for the current year (FY 2024-25) and comparative figures for the previous year (FY 2023-24). Previous year figures have been re-grouped or re-classified wherever necessary to conform to the current year''s presentation. All amounts are represented in Indian Rupees unless otherwise indicated. Any material regrouping has been disclosed in the notes.