Note 2. Material Accounting Policies

This note provides a list of the material accounting
policies adopted in the preparation of these standalone
financial statements. These policies have been
consistently applied except where a newly issued
accounting standard is initially adopted or a revision to
an existing accounting standard requires a change in
accounting policy hitherto in use.

Note 2.(1). Basis of preparation and presentation

(a) Statement of compliance with Ind AS

The standalone financial statements of the
Company have been prepared on accrual and
going concern basis, in accordance with Indian
Accounting Standards (Ind-AS) notified under
Section 133 of the Companies Act, 2013 (the “Act”)
read with the Companies (Indian Accounting
Standards) Rules, 2015, as amended from time to
time and other relevant provisions of the Act.

(b) Basis of measurement

The standalone financial statements have been
prepared on a historical cost convention on accrual
basis, except for the following material items that
have been measured at fair value as required by
relevant Ind AS:-

i) Certain financial assets and liabilities
measured at fair value (refer accounting policy
2(15) on financial instruments);

ii) Share based payment transactions;and

iii) Defined benefit and other long-term employee
benefits - plan assets measured at fair value.

(c) Classification between current and non-current

All assets and liabilities have been classified
as current or non-current as per the Company's
normal operating cycle, paragraph 66 and 69 of
Ind-AS 1 and other criteria as set out in Division II of
Schedule III to the Companies Act, 2013.

An asset is treated as current when it is:

i) Expected to be realised or intended to be sold
or consumed in normal operating cycle

ii) Held primarily for the purpose of trading

iii) Expected to be realised within twelve months
after the reporting period, or

iv) Cash or cash equivalent unless restricted from
being exchanged or used to settle a liability
for at least twelve months after the reporting
period

All other assets are classified as non-current.

A liability is treated as current when:

i) It is expected to be settled in normal operating
cycle

ii) It is held primarily for the purpose of trading

iii) I t is due to be settled within twelve months
after the reporting period, or

iv) There is no unconditional right to defer the
settlement of the liability for at least twelve
months after the reporting period.

The terms of the liability that could, at the option
of the counterparty, result in its settlement by
the issue of equity instruments do not affect its
classification.

The Company classifies all other liabilities as non¬
current.

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

The operating cycle is the time between the
acquisition of assets for processing and their
realisation in cash and cash equivalents. The
Company has identified twelve months as its
operating cycle.

(d) Presentation currency and rounding off

The financial statements are presented in
' and all values are rounded to nearest Lakhs
(' 00,000), unless otherwise stated.

(e) Going concern

The Company has prepared the standalone financial
statements on the basis that it will continue to
operate as a going concern.

(f) Use of estimates

The preparation of standalone financial statements
in conformity with Ind AS requires the Management
to make estimate and assumptions that affect
the reported amount of assets and liabilities as
at the Balance Sheet date, reported amount of
revenue and expenses for the year and disclosures
of contingent liabilities as at the Balance Sheet
date. The estimates and assumptions used in the
accompanying standalone financial statements are
based upon the Management's evaluation of the
relevant facts and circumstances as at the date of
the standalone financial statements. Actual results
could differ from these estimates. Estimates and
underlying assumptions are reviewed on a periodic
basis. Revisions to accounting estimates, if any,
are recognised in the year in which the estimates
are revised and in any future years if the revision
effects such periods. Also key sources of estimation
uncertainty is mentioned below:

i) Useful lives of property, plant and equipment
and intangible assets:

As described in the material accounting policy,
the Company reviews the estimated useful
lives of property, plant and equipment and

intangible assets at the end of each reporting
period.

ii) The fair value measurements and valuation
processes:

Some of the Company's assets and liabilities
are measured at fair value for financial
reporting purposes. In estimating the fair
value of an asset or liability, the Company
uses market-observable data to the extent it is
available. Where level 1 input are not available,
the Company engages third party valuers,
where required, to perform the valuation.
Information about the valuation techniques
and inputs, used in determining the fair value
of various assets, liabilities and share based
payments are disclosed in notes to standalone
financial statements.

iii) Actuarial valuation:

The determination of Company's liability
towards defined benefit obligation to
employees is made through independent
actuarial valuation including determination
of amounts to be recognized in the statement
of profit or loss and in other comprehensive
income. Such valuation depend upon
assumptions determined after taking into
account inflation, seniority, promotion and
other relevant factors such as supply and
demand factors in the employment market.
Information about such valuation is provided in
notes to standalone financial statements.

Note 2.(2). Property, plant and equipment

Property, plant and equipment are stated at cost
of acquisition less accumulated depreciation and
accumulated impairment losses, if any. Direct costs are
capitalized until the assets are ready for use and include
inward freight, and expenses incidental to acquisition
and installation. Subsequent expenditures related to
an item of Property, plant and equipment are added to
its book value only if they increase the future benefits
from the existing asset beyond its previously assessed

standard of performance. The carrying amount of
any component accounted for as a separate asset is
derecognised when replaced.

Depreciation methods, estimated useful lives

Depreciation on Property, plant and equipment is
provided when the assets are ready for use on the
straight line method, on a pro rata basis, over the
estimated useful lives of assets, in order to reflect the
period over which the depreciable asset is expected to
be used by the Company. Based on technical evaluation
the management estimates the useful lives of significant
items of property, plant and equipment as follows:

The leasehold improvements are depreciated over the
assets' useful life or over the shorter of the assets useful
life and the lease term.

Based on technical evaluation, the management believes
that the useful lives as given above best represent
the period over which management expects to use
these assets. Hence the useful lives for these assets is
different from the useful lives as prescribed under Part
C of schedule II of the Companies Act, 2013.

Depreciation on addition to property, plant and
equipment is provided on pro-rata basis from the date
of acquisition.

Depreciation on sale/deduction from property, plant and
equipment is provided up to the date preceding the date
of sale, deduction as the case may be. Losses arising
from the retirement of, and gains or losses arising from
disposal of property, plant and equipment measured
as the difference between amount realised and net
carrying value which are carried at cost are recognized
in the Standalone Statement of Profit and Loss under
‘Other income/Other expenses'.

Depreciation methods, useful lives and residual values
are reviewed periodically at each financial year end
and adjusted prospectively, as change in accounting
estimates.

Note 2.(3). Intangible assets and amortization

Intangible assets are recorded at the consideration
paid for acquisition of such assets and are carried at
cost of acquisition less accumulated amortization and
impairment, if any.

Intangible assets are recognized when the asset is
identifiable, is within the control of the Company,
probable that future economic benefits attributable
to the asset will flow to the Company and the cost of
the asset can be reliably measured. Expenditure on
research activities is recognized in the Standalone
Statement of Profit and Loss as incurred. Development
expenditure is capitalised only if the expenditure can be
measured reliably, the product or process is technically
and commercially feasible, future economic benefits
are probable and the Company intends to complete
development and to use or sell the asset.

The Company amortized intangible assets over their
estimated useful lives using the straight line method.
The estimated useful lives of intangible assets are as
follows:

Research costs are expensed as incurred. Software
product development costs are expensed as incurred
unless technical and commercial feasibility of the
project is demonstrated, future economic benefits are
probable, the Company has an intention and ability to
complete and use or sell the software and the costs can
be measured reliably. The costs which can be capitalized
include the cost of material, direct labour or employee
cost, professional fees paid to consultants, overhead
costs that are directly attributable to preparing the
asset for its intended use. Research and development
costs and software development costs incurred under
contractual arrangements with customers are accounted
as expenses in the Standalone Statement of Profit and
Loss.

Internally generated intangible assets (development
costs)

Expenditure on internally developed products is
capitalised if it can be demonstrated that:

(i) it is technically feasible to develop the product for it
to be sold

(ii) adequate resources are available to complete the
development

(iii) there is an intention to complete and sell the
product

(iv) the Company is able to sell the product

(v) sale of the product will generate future economic
benefits, and

(vi) expenditure on the project can be measured
reliably.

Capitalised development costs are amortized over the
periods (3-7 years) the Company expects to benefit
from selling the products developed. The amortisation
expense is included within the ‘depreciation and
amortisation expense' in the Standalone Statement of
Profit and Loss.

Development expenditure not satisfying the above
criteria and expenditure on the research phase of internal
projects are recognized in the Standalone Statement of
Profit and Loss as incurred.

Note 2.(4). Intangible assets under development

Intangibles which are not ready for intended use as on
the date of Balance Sheet are disclosed as Intangible
assets under development.

Intangible assets under development include costs
associated with the development of Software/Web
Applications for internal use and external sale. These
assets are recognized when all the following conditions
are met:

- The technical feasibility of completing the
Software/Web Applications so that it will be
available for use or sale is demonstrated.

- Management intends to complete the Software /
Web Applications and use or sell it.

- There is an ability to use or sell the Software /Web
Applications.

- It can be demonstrated how the Software /
Web Applications will generate probable future
economic benefits.

- Adequate technical, financial, and other resources
to complete the development and to use or sell the
Software/Web Applications are available.

- The expenditure attributable to the Software/Web
Applications during its development can be reliably
measured.

The costs capitalized include all directly attributable
costs necessary to create, produce, and prepare the
asset to be capable of operating in the manner intended
by management. These costs typically include:

- Salaries and wages of employees directly involved
in the development.

- Cost directly incurred for employees involved in the
development.

- Costs of materials and services consumed in
development.

- Depreciation of tools and equipment (if any) used in
development.

Subsequent to initial recognition, intangible assets under
development are carried at cost less any accumulated
impairment losses. They are tested for impairment
annually, and whenever there is an indication that the
asset may be impaired. Upon completion, these assets
are reclassified as intangible assets and are amortized
on a systematic basis over their estimated useful life
from the date they are available for use.

Note 2.(5). Impairment of non-financial assets

The Company assesses at each year end whether there
is any objective evidence that a non financial asset or
a group of non financial assets is impaired. If any such
indication exists, the Company estimates the asset's
recoverable amount and the amount of impairment loss.

An impairment loss is calculated as the difference
between an asset's carrying amount and recoverable

amount. Losses are recognized in Standalone Statement
of Profit and Loss and reflected in an allowance account.
When the Company considers that there are no realistic
prospects of recovery of the asset, the relevant amounts
are written off. If the amount of impairment loss
subsequently decreases and the decrease can be related
objectively to an event occurring after the impairment
was recognized, then the previously recognized
impairment loss is reversed through Standalone
Statement of Profit and Loss.

The recoverable amount of an asset or cash-generating
unit (as defined below) is the greater of its value in use
and its fair value less costs to sell. In assessing value in
use, the estimated future cash flows are discounted to
their present value using a pre-tax discount rate that
reflects current market assessments of the time value of
money and the risks specific to the asset. For the purpose
of impairment testing, assets are grouped together into
the smallest group of assets that generates cash in
flows from continuing use that are largely independent
of the cash inflows of other assets or groups of assets
(the “cash-generating unit”).

Note 2.(6). Leases

Company as a lessee:

The Company's lease asset classes primarily consist
of leases for office premises. The Company assesses
whether a contract contains a lease, at inception of a
contract. A contract is, or contains, a lease if the contract
conveys the right to control the use of an identified
asset for a period of time in exchange for consideration.
To assess whether a contract conveys the right to
control the use of an identified asset, the Company
assesses whether: (i) the contract involves the use of an
identified asset (ii) the Company has substantially all of
the economic benefits from use of the asset through the
period of the lease and (iii) the Company has the right to
direct the use of the asset.

At the date of commencement of the lease, the
Company recognizes a right-of-use asset (“ROU”) and a
corresponding lease liability for all lease arrangements
in which it is a lessee, except for leases with a term
of twelve months or less (short-term leases) and low
value leases. For these short-term and low value leases,

the Company recognizes the lease payments as an
operating expense on a straight-line basis over the term
of the lease.

Lease liability and ROU asset have been separately
presented in the Balance Sheet and lease payments
have been classified as financing cash flows.

Certain lease arrangements includes the options to
extend or terminate the lease before the end of the lease
term. ROU assets and lease liabilities includes these
options when it is reasonably certain that they will be
exercised.

The right-of-use assets are initially recognized at cost,
which comprises the initial amount of the lease liability
adjusted for any lease payments made at or prior to the
commencement date of the lease plus any initial direct
costs less any lease incentives. They are subsequently
measured at cost less accumulated depreciation and
impairment losses.

Right-of-use assets are depreciated from the
commencement date on a straight-line basis over the
lease term. The lease liability is initially measured
at amortized cost at the present value of the future
lease payments. Lease liabilities are remeasured with
a corresponding adjustment to the related right of use
asset if the Company changes its assessment if whether
it will exercise an extension or a termination option.

Company as a lessor:

At the inception of the lease the Company classifies
each of its leases as either an operating lease or a
finance lease. The Company recognizes lease payments
received under operating leases as income on a straight¬
line basis over the lease term. In case of a finance lease,
finance income is recognized over the lease term based
on a pattern reflecting a constant periodic rate of return
on the lessor's net investment in the lease.

Note 2.(7). Employee benefits

(a) Short-term obligations

The undiscounted amount of short term employee
benefits expected to be paid in exchange for the
services rendered by employees is recognized in
the year during which the employee rendered the

services. These benefits comprise salaries, wages

and performance incentives.

(b) Other long-term employee benefit obligations

(i) Defined contribution plan

The Company has defined contribution plans
for post employment benefits in the form of
provident fund, employees' state insurance,
labour welfare fund, pension fund (NPS)
and superannuation fund in India which are
administered through Government of India
and/or Life Insurance Corporation of India
(LIC).

(ii) Defined benefit Plan

Gratuity: The Company has defined benefit
plans for post employment benefits in
the form of gratuity for its employees in
India. The gratuity scheme of the Company
is administered through Life Insurance
Corporation of India (LIC). The cost of the
defined benefit gratuity plan and the present
value of the gratuity obligation are determined
using actuarial valuations. Actuarial gains
and losses are recognized immediately in the
Other Comprehensive Income (OCI) as income
or expense (net of taxes).

An actuarial valuation involves making various
assumptions that may differ from actual
developments in the future. These include
the determination of the discount rate; future
salary increases and mortality rates. Due to the
complexities involved in the valuation and its
long-term nature, a defined benefit obligation
is highly sensitive to changes in these
assumptions. All assumptions are reviewed at
each reporting date.

The parameter most subject to change is the
discount rate. In determining the appropriate
discount rate for plans operated in India, the
management considers the interest rates of
government bonds where remaining maturity
of such bond correspond to expected term of
defined benefit obligation.

The mortality rate is based on publicly available
mortality tables. Those mortality tables tend

to change only at interval in response to
demographic changes. Future salary increases
and gratuity increases are based on expected
future inflation rates.

(c) Share based payments

Stock options granted to employees of the Company
and its subsidiaries (direct and step down) under
the stock option scheme covered by Securities and
Exchange Board of India (Share based employee
benefits) Regulations, 2014 are accounted using
the fair value method. Under the equity settled
share-based payment, the fair value on the grant
date of the award given to employees is recognized
in the Standalone Statement of Profit and Loss with
a corresponding increase in equity over the vesting
period.

The fair value of the options at the grant date is
calculated by an independent valuer basis ‘Black
Scholes model'. At the end of each reporting period,
apart from the non-market vesting condition, the
expense is reviewed and adjusted to reflect changes
to the level of options expected to vest. When the
options are exercised, the Company issues fresh
equity shares. The fair value of options granted to
the employees of its subsidiaries are accounted as
“Investment in subsidiaries” on a graded vesting
basis over the vesting period of the option.

Note 2.(8). Foreign currency transactions

i) Functional and presentation currency: Items
included in the standalone financial statements
are measured using the currency of the primary
economic environment in which the entity operates
(‘the functional currency'). The standalone financial
statements are presented in Indian rupee ('), which
is the Company's functional and presentation
currency.

ii) Foreign currency transactions and balances:

a) On initial recognition, all foreign currency
transactions are recorded by applying to
the foreign currency amount the exchange
rate between the functional currency and
the foreign currency at the date of the
transaction. Gains/losses arising out of
fluctuation in foreign exchange rates between
the transaction date and settlement date are

recognized in the Standalone Statement of
Profit and Loss.

b) Monetary assets and liabilities denominated
in foreign currencies are translated at the
functional currency spot rates of exchange
at the reporting date and the exchange
differences are recognized in the Standalone
Statement of Profit and Loss.

c) Non-monetary items that are measured in
terms of historical cost in a foreign currency
are translated using the exchange rates at
the dates of the initial transactions. Non¬
monetary items measured at fair value in a
foreign currency are translated using the
exchange rates at the date when the fair value
is determined. The gain or loss arising on
translation of non-monetary items measured at
fair value is treated in line with the recognition
of the gain or loss on the change in fair value of
the item (i.e., translation differences on items
whose fair value gain or loss is recognized in
OCI or profit or loss are also recognized in OCI
or profit or loss, respectively).

Note 2.(9). Fair value measurement

The Company measures financial instruments, such as,
investments at fair value at each Balance Sheet date.

Fair value is the price that would be received to sell
an asset or paid to transfer a liability in an orderly
transaction between market participants at the
measurement date. The fair value measurement is based
on the presumption that the transaction to sell the asset
or transfer the liability takes place either:

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

- In the absence of a principal market, in the most
advantageous market for the asset or liability
accessible to the Company.

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

- Level 1 — Quoted (unadjusted) market prices in
active markets for identical assets or liabilities

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

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

The management determines the policies and
procedures for both recurring fair value measurement
and disclosure. For the purpose of fair value disclosures,
the Company has determined classes of assets and
liabilities on the basis of the nature, characteristics and
risks of the asset or liability and the level of the fair value
hierarchy as explained above.

Note 2.(10). Revenue from contracts with customers

Revenue from contracts with customers is recognized
when control of the services are transferred
(performance obligation), to the customer at an amount
that reflects the consideration, to which the Company
expects to be entitled in exchange for those goods or
services.

Revenue is measured at the fair value of the
consideration received or receivable, taking into account
contractually defined terms of payment and excluding
taxes or duties collected on behalf of the government.
The Company has concluded that it is the principal in its
revenue arrangements since it is the primary obligor in
the revenue arrangements as it has pricing latitude and
is also exposed to credit risks.

Rental income receivable under operating lease is
recognized on straight-line basis over the term of lease,
except where alternative basis is more representative
of pattern of benefit to be derived from leased asset.
leased incentive granted are recognized as integral part
of total rental income to be received. Contingent rental
are recognized as income in accounting period in which
they are earned.

Income from Information technology services
is recognized on rendering of services based on
agreements / arrangements with the concerned parties
over the period of time.

Revenues recognized in excess of invoicing are
classified as contract assets (which is classified as
unbilled revenue) while invoicing in excess of revenues
are classified as contract liabilities (which is classified
as unearned revenues).

2.(11). Other Income

Dividend income from investments is recognized when
the right to receive payment is established.

Interest income is recorded using the effective interest
rate (EIR). EIR is the rate that exactly discounts the
estimated future cash payments or receipts over the
expected life of the financial instrument.

2.(12). Taxes

The income tax expense or credit for the period is the tax
payable on the current period's taxable income based
on the applicable income tax rate adjusted by changes
in deferred tax assets and liabilities attributable to
temporary differences and to unused tax losses.

(a) Current income tax

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

Management periodically evaluates positions
taken in the tax returns with respect to situations
in which applicable tax regulations are subject to
interpretation and establishes provisions where
appropriate.

Current tax assets and liabilities are offset when
there is a legally enforceable right to offset the
recognized amount and there is an intention to
settle the asset and liability on a net basis.

(b) Deferred tax

Deferred income tax is recognized using the
balance sheet approach. Deferred income tax
assets and liabilities are recognized for deductible
and taxable temporary differences arising between
the tax base of assets and liabilities and their
carrying amount, except when the deferred income
tax arises from initial recognition of Goodwill or
from the initial recognition of an asset or liability
in a transaction that is not a business combination
and affects neither accounting nor taxable profit or
loss at the time of the transaction.

Deferred income tax assets are recognized to the
extent that it is probable that taxable profit will be

available against which the deductible temporary
differences and the carry forward of unused tax
credits and unused tax losses can be utilised.

The carrying amount of deferred income tax assets
is reviewed at each reporting date and reduced
to the extent that it is no longer probable that
sufficient taxable profit will be available to allow
all or part of the deferred income tax asset to be
utilised. Deferred tax assets and liabilities are
measured using substantively enacted tax rates
expected to apply to taxable income in the years in
which the temporary differences are expected to be
received or settled.

Deferred tax liabilities are not recognized for
temporary differences between the carrying
amount and tax bases of investments in subsidiaries
where the Company is able to control the timing of
the reversal of the temporary differences and it is
probable that the differences will not reverse in the
foreseeable future.

Deferred tax assets and liabilities are offset when
there is a legally enforceable right to set off assets
against liabilities representing the current tax and
where the deferred tax assets and liabilities relate
to taxes on income levied by the same governing
taxation laws.