i. Basis of preparation
These financial statements have been prepared in accordance with the generally accepted accounting
principles in India under the historical cost convention on accrual basis. These financial statements have been
prepared to comply in all material aspects with the accounting standards notified under the Companies
(Accounting Standards) Rules, 2006 (as amended), specified under Section 133 and other relevant provisions
of the Companies Act, 2013.
All assets and liabilities have been classified as current or non-current as per the Company’s operating cycle
and other criteria set out in the Schedule III (Division I) to the Companies Act, 2013. Based on the nature of
products and the time between the acquisition of assets for processing and their realization in cash and cash
equivalents, the Company has ascertained its operating cycle as 12 months for the purpose of current - non¬
current classification of assets and liabilities.
ii. Use of estimates
In preparing the Company’s financial statements in conformity with the accounting principles generally
accepted in India, management is required to make estimates and assumptions that affect the reported
amounts of assets and liabilities and the disclosure of contingent liabilities at the date of the financial
statements and the results of operations during the reporting periods. Actual results could differ from those
estimates. Any revision to accounting estimates is recognised prospectively in the current and future periods.
iii. Property, plant and equipment (PPE)
Tangible assets
Tangible assets are carried at cost less accumulated depreciation and accumulated impairment losses, if any.
Cost comprises of the purchase price including import duties and non-refundable taxes, and directly
attributable expenses incurred to bring the asset to the location and condition necessary for it to be capable
of being operated in the manner intended by management. Capital expenditure incurred on rented properties
is classified as ‘Leasehold improvements’ under property, plant and equipment.
Subsequent costs related to an item of Property, Plant and Equipment are recognised in the carrying amount
of the item if the recognition criteria are met. Items of Property, Plant and Equipment that have been retired
from active use and are held for disposal are stated at the lower of their net carrying amount and net
realisable value and are shown separately in the financial statements under the head ‘Other current assets’.
Any write-down in this regard is recognised immediately in the Statement of Profit and Loss. An item of
Property, Plant and Equipment is derecognised on disposal or when no future economic benefits are
expected from its use or disposal. The gain or loss arising on derecognition is recognised in the Statement of
Profit and Loss.
Depreciation on tangible asset is recognised on a straight-line basis based on a useful life of the assets
prescribed in Schedule II to the Act.
iv. Intangible assets
Intangible assets are stated at acquisition cost, net of accumulated amortization and accumulated impairment
losses, if any. Intangible assets are amortised on a straight-line basis over their estimated useful lives. Gains
or losses arising from the retirement or disposal of an intangible asset are determined as the difference
between the net disposal proceeds and the carrying amount of the asset and recognised as income or expense
in the Statement of Profit and Loss.
v. Impairment
The Company assesses at each balance sheet date whether there is any indication that an asset may be
impaired. If any such indication exists, the Company estimates the recoverable amount of the asset. If such
recoverable amount of the asset or the recoverable amount of the cash generating unit to which the asset
belongs is less than its carrying amount, the carrying amount is reduced to its recoverable amount and the
reduction is treated as an impairment loss and is recognised in the Statement of Profit and Loss account. If
at the balance sheet date there is an indication that if a previously assessed impairment loss no longer exists,
the recoverable amount is reassessed and the asset is reflected at the recoverable amount subject to a
maximum of depreciated historical cost.
vi. Current and Deferred Tax
Tax expense for the period, comprising current tax and deferred tax, are included in the determination of
the net profit or loss for the period. Current tax is measured at the amount expected to be paid to the tax
authorities in accordance with the taxation laws prevailing in the respective jurisdictions.
Deferred tax is recognised for all the timing differences, subject to the consideration of prudence in respect
of deferred tax assets. Deferred tax assets are recognised and carried forward only to the extent that there is
a reasonable certainty that sufficient future taxable income will be available against which such deferred tax
assets can be realized. Deferred tax assets and liabilities are measured using the tax rates and tax laws that
have been enacted or substantively enacted by the Balance Sheet date. In situations, where the Company has
unabsorbed depreciation or carry forward losses under tax laws, all deferred tax assets are recognised only to
the extent that there is virtual certainty supported by convincing evidence that they can be realized against
future taxable profits. At each Balance Sheet date, the Company re-assesses unrecognized deferred tax
assets, if any.
Current tax assets and current tax liabilities are offset when there is a legally enforceable right to set off the
recognised amounts and there is an intention to settle the asset and the liability on a net basis. Deferred tax
assets and deferred tax liabilities are offset when there is a legally enforceable right to set off assets against
liabilities representing current tax and where the deferred tax assets and the deferred tax liabilities relate to
taxes on income levied by the same governing taxation laws.
Minimum Alternate Tax (‘MAT’) credit is recognised as an asset only when and to the extent there is
convincing evidence that the Company will pay normal income-tax during the specified period. In the year
in which MAT credit becomes eligible to be recognised as an asset in accordance with the recommendations
contained in Guidance Note on Accounting for Credit Available in respect of Minimum Alternative Tax
under the Income-tax Act, 1961, the said asset is created by way of a credit to the Statement of Profit and
Loss and shown as MAT credit entitlement. The Company reviews the same at each balance sheet date and
writes down the carrying amount of MAT credit entitlement to the extent it is not reasonably certain that
the Company will pay normal income tax during the specified period.
vii. Revenue recognition
Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Company
and the revenue can be reliably measured.
DSA of Credit Card sales & other financial services
Revenue in respect of service rendered is recognised, on accrual basis net of Goods and Service Tax and
discounts, as and when the service are performed as per the contractual terms agreed with the customer and
when it is reasonably certain that the ultimate collection will be made.
Interest
Revenue is recognised on a time proportion basis taking into account the amount outstanding and the rate
applicable
viii. Employee benefits
Employee benefits in the form of Provident Fund and Employee State Insurance Scheme are defined
contribution plans and the contributions are charged to the Statement of Profit and Loss of the year when
the contributions to the respective funds are due. There are no other obligations other than the contribution
payable to the respective funds.
Short-term employee benefits: All employee benefits payable wholly within twelve months of rendering the
service are classified as short-term employee benefits and are recognised in the Statement of Profit and Loss
in the period in which the employee renders the related service.
Gratuity is a post-employment benefit and is in the nature of a defined benefit plan. The liability recognised
in the balance sheet in respect of gratuity is the present value of the defined benefit obligation at the balance
sheet date. The defined benefit obligation is calculated at the balance sheet date by an independent actuary
using the projected unit credit method. Actuarial gains and losses arising from past experience and changes in
actuarial assumptions are charged to the Statement of Profit and Loss in the year in which such gains or
losses are determined.
ix. Cash and cash equivalents
Cash and cash equivalents include cash in hand, demand deposits with banks, other short-term highly liquid
investments with original maturities of three months or less
x. Foreign currency transactions
Initial recognition
Foreign currency transactions are recorded in the reporting currency, by applying to the foreign currency
amount the exchange rate between the reporting currency and the foreign currency at the date of the
transaction.
Conversion
Foreign currency monetary items are reported using the closing rate. Non-monetary items which are carried
in terms of historical cost denominated in a foreign currency are reported using the exchange rate at the
date of the transaction; and non-monetary items which are carried at fair value or other similar valuation
denominated in a foreign currency are reported using the exchange rates that existed when the values were
determined.
Exchange differences
Exchange differences arising on the settlement of monetary items or on restatement of the Company's
monetary items at rates different from those at which they were initially recorded during the year, or
reported in previous financial statements, are recognised as income or as expenses in the year in which they
arise other than of the capitalization of exchange differences which is referred to in PPE above.
xi. Earnings/(loss) per share
Basic earnings/(loss) per share is calculated by dividing the net profit or loss for the period attributable to
equity shareholders by the weighted average number of equities shares outstanding during the period.
For the purpose of calculating diluted earnings/(loss) per share, the net profit or loss for the period attributable
to equity shareholders and the weighted average number of shares outstanding during the periodare adjusted
for the effects of all dilutive potential equity shares.
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