xviii) Provisions
Provisions are recognized when the Company has a present obligation (legal or constructive) 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 expense relating to a provision is presented in the statement of profit and loss net of any reimbursement.
If the effect of the time value of money is material, provisions are discounted using a current pre-tax rate that reflects, when appropriate, the risks specific to the liability. When discounting is used, the increase in the provision due to the passage of time is recognized as a finance cost.
Provisions are reviewed at the end of each reporting period and adjusted to reflect the current best estimate. If it is no longer probable that an outflow of resources would be required to settle the obligation, the provision is reversed.
xix) Contingent liabilities
A contingent liability is a possible obligation that arises from past events whose existence will be confirmed by the occurrence or non-occurrence of one
or more uncertain future events beyond the control of the Company or a present obligation that is not recognized because it is not probable that an outflow of resources will be required to settle the obligation. A contingent liability also arises in extremely rare cases where there is a liability that cannot be recognized because it cannot be measured reliably. The Company does not recognize a contingent liability but discloses its existence in the financial statements. Refer note 29 (b).
xx) Share based payments
Employees (including senior executives) of the Company receive remuneration in the form of share-based payments, whereby employees render services as consideration for equity instruments (equity-settled transactions).
Equity-settled transactions
The cost of equity-settled transactions is determined by the fair value at the date when the grant is made using an appropriate valuation model.
That cost is recognized, together with a corresponding increase in share-based payment (SBP) reserves in equity, over the period in which the service conditions are fulfilled in employee benefits expense. The cumulative expense recognized for equity-settled transactions at each reporting date until the vesting date reflects the extent to which the vesting period has expired and the Company's best estimate of the number of equity instruments that will ultimately vest. The statement of profit and loss expense or credit for a period represents the movement in cumulative expense recognized as at the beginning and end of that period and is recognized in employee benefits expense.
Service conditions are not taken into account when determining the grant date
fair value of awards, but the likelihood of the conditions being met is assessed as part of the Company's best estimate of the number of equity instruments that will ultimately vest.
No expense is recognized for awards that do not ultimately vest because service conditions have not been met.
When the terms of an equity-settled award are modified, the minimum expense recognised is the grant date fair value of the unmodified award, provided the original vesting terms of the award are met. An additional expense, measured as at the date of modification, is recognised for any modification that increases the total fair value of the share-based payment transaction, or is otherwise beneficial to the employee. Where an award is cancelled by the entity or by the counterparty, any remaining element of the fair value of the award is expensed immediately through profit or loss.
The dilutive effect of outstanding options is reflected as additional share dilution in the computation of diluted earnings per share.
xxi) Treasury shares
The ESOP trust has been treated as an extension of the company and accordingly shares held by ESOP trust are netted off from the total share capital. Consequently, all the assets, liabilities, income and expenses of the trust are accounted as assets and liabilities of the company, except for profit/loss on issue of shares to the employees and dividend received by trust which are directly adjusted in the Affle (India) limited employee welfare trust reserve.
xxii) Earnings per share
Basic earnings per share (EPS) are calculated by dividing the net profit or loss for the year attributable to equity shareholders by the weighted average number of equity shares outstanding during the year. The weighted average number of equity shares outstanding during the period is adjusted for events such as bonus issue, bonus element in a rights issue, share split, and reverse share split (consolidation of shares) that have changed the number of equity shares outstanding, without a corresponding change in resources.
Diluted EPS amounts are calculated by dividing the profit or loss attributable to equity holders of the Company (after adjusting the corresponding income/ charge for dilutive potential equity shares) by the weighted average number of Equity shares outstanding during the year plus the weighted average number of Equity shares that would be issued on conversion of all the dilutive potential Equity shares into Equity shares.
xxiii) Segment reporting
The Chief Operating Decision Maker (CODM) being the Board of Directors (Board) evaluates the Company's performance from a services perspective and has identified the ‘business ofproviding services in advertisement and software development' as a single segment. As part for geographical segments, the company mainly operates in India only. The aforesaid is in line with review operating results by the CODM. As such, there is no separate reportable segments as per the requirement of IND AS 108-'operating Segments Reporting' notified under the companies (India Accounting Standards) Rules,2015, as amended.
Identification of segments
Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision maker(CODM). Only thosebusiness activities are identified as operating segment for which the operating results are regularly reviewed by the CODM to make decisions about resource allocation and performance measurement.
Inter-segment transfers
The Company generally accounts for intersegment sales and transfers at cost plus appropriate margins.
Allocation of common costs
Common allocable costs are allocated to each segment according to the relative contribution of each segment to the total common costs.
Unallocated items
Unallocated items include general income and expense items which are not allocated to any business segment.
Segment accounting policies
The Company prepares its segment information in conformity with the accounting policies adopted for preparing
and presenting the financial statements of the Company as a whole.
xxiv) Recent Pronouncements
Ministry of Corporate Affairs (“MCA”) notifies new standards or amendments to the existing standards under Companies (Indian Accounting Standards) Rules as issued from time to time. For the year ended March 31, 2024, MCA has not notified any new standards or amendments to the existing standards applicable to the Company.
xxv) Use of Estimates, assumptions, Judgments and major sources of estimation uncertainty
In preparing these financial statements, management has made judgements, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities, the disclosures of contingent liabilities and contingent assets as at the date of financial statements, income and expenses during the period. Actual results may differ from these estimates. Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to estimates are recognised prospectively.
Terms/rights attached to preference shares
*The Company has the right to be entitled to receive dividend if declared at any point of time. These preference shares can be convertible into equity shares of Affle X Private Limited after complying the provision of Companies Act, 2013 and the manner as specified in the subscription agreement. The Company does not have any voting rights in the invested entity except in case any resolution is passed. The holders shall have an option to redeem the only fully paid up Preference share having maximum redemption period of 20 years.
**The Company has the right to be entitled to receive dividend if declared at any point of time. These preference shares can be convertible into equity shares of Explurger Private Limited after complying the provision of Companies Act, 2013 and the manner as specified in the subscription agreement. The Company have voting right as agreed in Series A share subscription and shareholder agreement. series A CCPS are non-redeemable and compulsory convertible into equity share in the ratio of 1:1on completion of 19(Nineteen) year and 11 (eleven) month or as per series A share subscription and shareholder agreement.
***The Company has granted employees stock option to the eligible employees of wholly owned subsidiary and its subsidairies controlled through intermediate subsidairies. This has been treated as deemed investment in respective subsidiary by the Company as per guidance under IND AS.
8 (II) DEFERRED TAX
The Company offsets tax assets and liabilities if and only if it has a legally enforceable right to set off current tax assets and current tax liabilities and the deferred tax assets and deferred tax liabilities relates to income taxes levied by the same tax authority.
I n assessing the realisibility of deferred tax assets, management considers whether it is probable, that some portion, or all, of the deferred tax assets will not be realised. The ultimate realisation of deferred tax assets is dependent upon the generation of future taxable income during the years in which the temporary differences become deductible. Management considers the projected future taxable income and tax planning strategies in making this assessment. Based on the level
(iii) Performance obligations
Information about the Company's performance obligations are summarised below:
Consumer platform
The performance obligation is satisfied at a point in time and payment is generally due within 30 to 90 days of completion of services and acceptance of the customer. In some contracts, shortterm advances are required before the advertisement services are provided.
As the duration of the contracts for consumer is less than one year, the Company has opted for practical expedient and decided not to disclose the amount of the remaining performance obligations.
Other operating revenue
The performance obligation is satisfied at a point in time and payment is generally due within 30 to 90 days of completion of services and acceptance of the customer.
Notes: There is no difference between the amount of revenue recognised in the profit and loss statement and the contract price.
26. EARNINGS PER SHARE
Basic EPS amounts are calculated by dividing the profit for the year attributable to equity holders of the company by the weighted average number of equity shares outstanding during the year excluding treasury shares.
Diluted earning per share adjusts the figure used in the determination of basic earnings per share to take into account the after income tax effect of interest and other financing costs associated with dilutive equity shares and the weighted average number of additional equity shares that would have been outstanding assuming the conversio of all dilutive potential equity shares.
The following reflects the income and share data used in the basic and diluted EPS computations:
27. EMPLOYEE BENEFITS
A. Defined contribution plans
Provident fund:
The Company makes contribution towards employees' provident fund. The Company has recognised INR 10.99 million (March 31, 2023: INR 10.88 million) as an expense towards contribution to this plan.
B. Defined benefit plans
Gratuity:
The gratuity plan is governed by the Payment of Gratuity Act, 1972. Under the Act, employees who have completed five years of service are entitled to specific benefit. The level of benefit provided depends on the member's length of service and salary retirement age. The employee is entitled to a benefit equivalent to 15 days salary last drawn for each completed year of service with part thereof in excess of six months. The same is payable on termination of service or retirement or death whichever is earlier.
The present value of the obligation under such defined benefit plan is determined based on an actuarial valuation as at the reporting date using the projected unit credit method, which recognizes each year of service as giving rise to additional unit of employee benefit entitlement and measures each unit separately to build up the final obligation. The obligations are measured at the present value of the estimated future cash flows. The discount rate used for determining the present value of the obligation under defined benefit plans is based on the market yields on Government bonds as at the date of actuarial valuation. Actuarial gains and losses (net of tax) are recognised immediately in the other comprehensive income (OCI).
This is a unfunded benefit plan for qualifying employees. The scheme provides for a lump sum payment to vested employees at retirement, death while in employment or on termination of employment. Vesting occurs upon completion of five years of service.
The following tables summaries the components of net benefit expense recognised in the statement of profit or loss and other comprehensive income and amounts recognised in the balance sheet for the gratuity plan:
29. COMMITMENTS AND CONTINGENT LIABILITIES
a. Capital commitments
As at March 31,2024, the Company has commitments on capital account and not provided for
(net of advances) of INR 8.64 million (March 31,2023: INR 9.78 million).
b. Contingent liabilities
(i) Claims against the Company not acknowledged as debts includes the following:
- Income tax demand from the Income tax authorities for assessment year 2017-18 of INR 64.88 million on account of disallowance of bad debts written off, advances written off, amortization of goodwill and certain expenses under various heads as claimed by the Company in the income tax. The matter is pending before Commissioner of Income Tax (Appeals), Mumbai. In response (dated January 29, 2020) to the notice company has discharged 20% of demand i.e. INR 13 million by depositing INR 6.50 million vide challan No 11922 with HDFC Bank on January 28, 2020 and adjusting a refund of INR 6.25 million which is outstanding for AY 2015-16 on which interest under section 244A of the Act is also pending and this will exceeds a residual amount of INR 6.50 million. "
- Income tax demand from the Income tax authorities order dated September 17, 2022, for assessment year 2020-21 of INR 1.13 million on account of disallowance of Corporate Social Responsibility (CSR) expenditure under section 80G of the Income Tax Act, 1961 of INR 2.15 million as claimed by the Company in the income tax. The matter is pending before Commissioner of Income Tax (Appeals), Mumbai.
- Income tax demand from the Income tax authorities order dated October 10, 2023 for assessment year 2021-22 of INR 31.7 million on the ground that documentation not provided. Mumbai High court has stayed the demand in the Order on May 7, 2024.
The Company is contesting the demands and the management, including its tax advisors, believes that its position will likely be upheld in the appellate process. No tax expense has been accrued in the financial statements for the demand raised. The management believes that the ultimate outcome of these proceedings will not have a material adverse effect on the Company's financial position and results of operations. The likelihood of the above cases going in favour of the Company is probable and accordingly has not considered any provision against the demands in the financial statements.
(ii) (a) The opening balance of Stand by Letter of Credit (SBLC) as on April 01 ,2023 is amounting
to INR 699.72 million (equivalent to USD 10.11 million) was taken in favour of Axis Bank Limited, Singapore. An addition amounting to INR 1,886 million (USD 23 million) is done during the current year. Further during the current year it is reduced by INR 231.46 million (equivalent to USD 3.11 million). The outstanding closing balance of SBLC in favour of Axis Bank Limited, Singapore is INR 2,354.26 million (equivalent to USD 30 million).
(b) The opening balance of Stand by Letter of Credit (SBLC) as on April 01 , 2023 is amounting to INR 439.68 million (equivalent of USD 6.00 million) was taken in favour of HDFC Bank Limited, Bahrain. The outstanding closing balance of SBLC in favour of HDFC Bank Limited, Bahrain is INR 439.68 million (equivalent to USD 6 million).
Terms and conditions of transactions with related parties
The sale and purchase from related parties are made on terms equivalent to those that prevail in arm's length transaction. Outstanding balances at the year end are unsecured and interest free and settlement occurs in cash. For the year ended March 31, 2024 and year ended March 31, 2023, the Company has not recorded any impairment of trade receivables relating to amounts owed by related parties. This assessment is undertaken each financial year through examining the financial position of the related party and the market in which the related party operates.
31. SEGMENT INFORMATION
(a) The Chief Operating Decision Maker (CODM) being the Board of Directors (Board) evaluates the Company's performance from a services perspective and has identified the ‘business of providing services in advertisement and software development' as a single segment. As part for geographical segments, the company mainly operates in India only. The aforesaid is in line with
33. FAIR VALUE HIERARCHY
All financial instruments for which fair value is recognised or disclosed are categorised within the fair value hierarchy, described as follows, based on the lowest level input that is insignificant to the fair value measurements as a whole.
Level 1 : Quoted (unadjusted) prices in active markets for identical assets or liabilities.
Level 2 : Valuation techniques for which the lowest level inputs that has a significant effect on the fair value measurement are observable, either directly or indirectly.
Level 3 : Valuation techniques for which the lowest level input which has a significant effect on fair value measurement is not based on observable market data.
The cost of unquoted investment included in level 3 of fair value hierarchy approximate their face value because there is a wide range of possible fair value measurement and the cost represents estimate of fair value within that range
The following table provides the fair value measurement hierarchy of the Company's assets and liabilities.
Valuation technique used to derive fair values
The Company's unquoted instruments is estimated by discounting future cash flows using rates currently applicable for debt on similar terms, credit risk and remaining maturities. The valuation requires management to make certain assumptions about the model inputs, including forecast cash flows, discount rate, credit risk and volatility. The probabilities of the various estimates within the range can be reasonably assessed and are used in management's estimate of fair value for these unquoted equity investments.
34. FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES
The Company's principal financial liabilities comprises trade payables, other payables, capital creditors and employee related payables. The main purpose of these financial liabilities is to finance the Company's operations and to provide guarantees to support its operations. The Company's principal financial assets include trade and other receivables, and cash and cash equivalent that derive directly from its operations.
The Company is exposed to market risk, credit risk and liquidity risk. The Company's senior management oversees the management of these risks. The Company's senior management is responsible to ensure that Company's financial risk activities are governed by appropriate policies and procedures and that financial risks are identified, measured and managed in accordance with the Company's policies and risk objectives. The Board of Directors reviews and agrees policies for managing each of these risks, which are summarised below:
a. Market risk
Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of a change in market price.
(i) Foreign currency risk
Foreign currency risk is the risk that the fair value or future cash flows of an exposure will fluctuate because of changes 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 expense is denominated in a foreign currency).
The Company does not use derivative financial instruments such as forward exchange contracts or options to hedge its risk associated with foreign currency fluctuations or for trading/speculation purpose.
The amount of foreign currency exposure not hedged by derivative instruments or otherwise is as under:
b. Credit risk
Credit risk is the risk that counterparty will not meet its obligations under a financial instrument or customer contract, leading to a financial loss. The Company is exposed to credit risk from its operating activities (primarily trade receivables) and from its investing activities, including deposits with banks and financial institutions.
A counterparty whose payment is due more than 90 days after the due date is considered as a defaulted party. This is based on considering the market and economic forces in which the Company operates. The Company write-off the amount if the credit risk of counter-party increases significantly due to its poor financial position.
All the financial assets carried at amortised cost were into good category except some portion of trade receivables considered under doubtful category (refer note 10).
Trade receivables and contract assets
Trade receivables are typically unsecured. Credit risk is managed by the Company 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.
Cash and cash equivalents and bank deposits
Credit risk related to cash and cash equivalents and bank deposits is managed by only accepting highly rated banks and diversifying bank deposits and accounts in different banks across the country.
Other financial assets
Other financial assets are considered to have low credit risk since there is a low risk of default by the counterparties owing to their strong capacity to meet contractual cash flow obligations in the near term. Credit risk related to these other financial assets is managed by monitoring the recoverability of such amounts continuously, while at the same time internal control system in place ensure the amounts are within defined limits.
The Company is exposed to credit risk in the event of non-payment by customers. An impairment analysis is performed at each reporting date. The Company uses a provision matrix to measure the expected credit loss of trade receivables.
Financial instruments and cash deposits
Credit risk from balances with banks is managed by the Company's treasury department in accordance with the Company's policy. Investments of surplus funds are made only with approved counterparties and within credit limits assigned to each counterparty. Counterparty credit limits are reviewed by the Company's Board of Directors on an annual basis, and may be updated throughout the year subject to approval of the Company's finance committee. The limits are set to minimise the concentration of risks and therefore mitigate financial loss through counterparty's potential failure to make payments.
c. Liquidity risk
Liquidity risk is the risk that the Company will not be able to meet its financial obligations as they become due. The Company monitors their risk of shortage of funds using cash flow forecasting models. These models consider the maturity of their financial investments, committed funding and projected cash flows from operations. The Company's objective is to provide financial resources to meet its business objectives in a timely, cost effective and reliable manner.
A balance between continuity of funding and flexibility is maintained through the use of borrowings. The Company also monitors compliance with its debt covenants. The maturity profile of the Company's financial liabilities based on contractual undiscounted payments is given in the table below:
The Company manages its capital structure and makes adjustments in light of changes in economic conditions and the requirements of the financial covenants. To maintain or adjust the capital structure, the Company may adjust the dividend payment to shareholders, return capital to shareholders or issue new shares.
The Company monitors capital using a gearing ratio, which is net debt divided by total capital plus net debt. The Company includes within net debt, interest bearing loans and borrowings, trade and other payables, less cash and cash equivalents. The Company's policy is to keep the gearing ratio between 0% and 10%.
35. CAPITAL MANAGEMENT
The Board's policy maintains a strong capital base so as to maintain investor, creditor and market confidence and to sustain future development of the business. The Board of Directors monitor the return on capital employed as well as the amount of dividend if any to shareholders.
For the purpose of the Company's capital management, capital includes issued capital and all other equity reserves attributable to the equity shareholders of the Company. The primary objective of the Company when managing capital is to safeguard its ability to continue as a going concern and to maintain an optimal capital structure so as to maximize shareholder value. As at March 31,2024 and March 31,2023, the Company has only one class of equity shares and has no debt. Consequent to such capital structure, there are no externally imposed capital requirements.
36. IMPAIRMENT TESTING OF GOODWILL
Goodwill acquired through business combinations have indefinite life. The Company performs the impairment testing at the initial recognition of Goodwill. The Company further performs impairment testing as and when the indicators arise. At present there is no indicator for impairment of Goodwill. The Company considers the relationship between its value in use and its carrying value, among other factors, when reviewing for indicators of impairment.
The recoverable amount of the goodwill is determined based on value in use (‘VIU') calculated using cash flow projections from financial budgets approved by management covering a five year period and the terminal value (after considering the relevant long-term growth rate) at the end of the said forecast periods. The Company has used long-term growth rate of 10% (March 31, 2023: 5%) and discount rate of 11.70% (March 31,2023: 10%) for calculation of terminal value.
The said cash flow projections are based on the senior management past experience as well as expected met trends for the future periods. The projected cash flows have been updated to reflect the decreased demand for services. The calculation of weighted average cost of capital (WACC) is based on the Company's estimated capital structure as relevant and attributable to the Company. The WACC is also adjusted for specific risks, market risks and premium, and other inherent risks associated with similar type of investments to arrive at an approximation of the WACC of a comparable market participant. The said WACC being pre-tax discount rates reflecting specific risks, are then applied to the above mentioned projections of the estimated future cash flows to arrive at the discounted cash flows. The Company considers the consumer platform stack as a single CGU for the purpose of impairment testing of goodwill.
Discount rates represent the market assessment of the risks, taking into consideration the time value of money and individual risks of the underlying assets that have not been incorporated in the cash flow estimates. The discount rate calculation is based on the specific circumstances of the Company and its operating segments and is derived from its WACC.
The key assumptions used in the determination of VIU are the revenue annual growth rates and the EBITDA growth rate. Revenue and EBITDA growths are based on average value achieved in preceding years. Also, the growth rates used to extrapolate the cash flows beyond the forecast period are based on industry standards.
Based on the above assumptions and analysis, no impairment was identified as at March 31, 2024 (March 31, 2023: Nil). Further, on the analysis of the said calculation's sensitivity to a reasonably possible change in any of the above mentioned key assumptions/parameters on which the management has based determination of the recoverable amount, there are no scenarios identified by the management wherein the carrying value could exceed its recoverable amount.
37. EMPLOYEE SHARE BASED PAYMENT
During the year ended March 31,2022, the Company has issued Employee Stock Option Scheme -2021”. The relevant details of the scheme and the grant are as follows:
Scheme: Affle (India) Limited Employee Stock Option Scheme - 2021
a) The Company instituted an Employees Stock Option Scheme (“ESOPs”) for certain employees of the Company, its subsidiary and its step down subsidiaries (together know as Group) as approved by the shareholders on September 23, 2021 which provides for a grant of 3,750,000 options (each option convertible into share) to employees of the Group.
During the year ended March 31,2024 the Company has further granted 189,420 options to the eligible employees on December 11, 2023 as approved by the nomination and remuneration committee of the Company.
39. OTHER STATUTORY INFORMATION
(i) The Company does not have any Benami property, where any proceeding has been initiated or pending against the company for holding any Benami property under the Benami Transactions (Prohibition) Act, 1988 and rules made thereunder.
(ii) The Company have balance with the below-mentioned company 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 / balances or Virtual Currency during the financial year ended March 31,2024 and March 31, 2023.
(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 group (ultimate beneficiaries) or
b. provide any guarantee, security or the like to or on behalf of the ultimate beneficiaries
(vi) The Company has not received any fund from any person(s) or entity(ies), including foreign entities (funding party) with the understanding (whether recorded in writing or otherwise) that the group shall:
a. directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Funding Party (ultimate beneficiaries) or
b. provide any guarantee, security or the like on behalf of the ultimate beneficiaries
(vii) There is no income surrendered or disclosed as income during the current or previous year in the tax assessments under the Income Tax Act, 1961, that has not been recorded in the books of account.
(viii) The Company has not been declared as willful defaulter by any bank or financial institution or other lender.
(ix) The Company has taken loan facility from bank but not utlised in the current year or previous year.
(x) The Company has not entered into any scheme of arrangement which has an accounting impact on current or previous financial year
(xi) The Company has not revalued its property, plant and equipment (including right-of-use assets) or intangible assets or both during the current or previous year
(xii) The Company has not owned any immovable property.
(xiii) The Company has complied with the number of layers prescribed under the companies Act, 2013, read with the companies (Restriction on number of layers) Rules, 2017.
(xiv) The Company has not owned any immovable property. All the properties where the company is the lessee, the lease agreements are duly executed in the favour of lessee.
(xv) Disclosure as per section 186 of Companies Act 2013 The details of loans, guarantees and investments under section 186 of the Companies Act, 2013 read with the Companies (Meetings of Board and its Powers) Rules, 2014 are as follows:
(a) Details of loan given by the company and guarantees issued as at March 31, 2024 and March 31,2023 refer note 30.
40. The Code on Social Security, 2020 (‘Code') relating to employee benefits during employment and post employment benefits received Presidential assent in September 2020. The Code has been published in the Gazette of India. However, the date on which the Code will come into effect has not been notified and the final rules/interpretation have not yet been issued. The Company will assess the impact of the Code when it comes into effect and will record any related impact in the period the Code becomes effective.
41. The Ministry of Corporate Affairs (MCA) has prescribed a new requirement for companies under the proviso to Rule 3(1) of the Companies (Accounts) Rules, 2014 inserted by the Companies (Accounts) Amendment Rules 2021 requiring companies, which uses accounting software for maintaining its books of account, shall use only such accounting software which has a feature of recording audit trail of each and every transaction, creating an edit log of each change made in the books of account along with the date when such changes were made and ensuring that the audit trail cannot be disabled.
The Company has used an accounting software which is operated by a third party service provider for maintenance of books of accounts. The Company has obtained the ‘Independent Service Auditor's Assurance Report on Controls relevant to Security, Availability and Confidentiality (‘Type 2 report' issued in accordance with ISAE 3000 (Revised), Assurance Engagements Other than Audits or Reviews of Historical Financial Information) issued by the International Auditing and Assurance Standards Board for the year ended March 31,2024. The accounting software is used in form of software-as-a-service; and SOC 2 report does not provide information on availability of audit trail at database level.
42. The Company has appointed independent consultants for conducting a transfer pricing study to determine whether the transactions with associated enterprise were undertaken at "arms length price". The management confirms that all domestic and international transactions with associated enterprises are undertaken at negotiated contracted price on usual commercial terms and is confident of there being no adjustment on completion of the study. Adjustment, if any, arising from the transfer pricing study shall be accounted for as and when the study is completed.
43. 43. During the year, the Group had issued and allotted 69,00,000 equity shares with face value of INR 2 each, at a premium of INR 1,083.54 each aggregating to INR 7,380.28 million (net of issue expenses of INR 109.95 million) on a preferential basis to Gamnat Pte. Ltd. The issue was made in accordance with Chapter V of the SEBI (Issue of Capital and Disclosure Requirements) Regulations, 2018 (“SEBI ICDR Regulations”), as amended, the Companies Act, 2013, other applicable laws and other requisite statutory and regulatory approvals. As at March 31,2024 the Group has utilised INR 1,483.38 million towards purposes specified in the Offer document and the balance amount remains invested in fixed and other deposits.
Further, the Group has issued and allotted 58,000 equity shares with face value of INR 2 each, at a premium of INR 1,048.00 each aggregating to INR 60.90 million to ESOP trust on exercise of options under the ESOP scheme.
44. During the earlier year, the Company had completed Qualified Institutional Placement (“QIP”) by issuing 1,153,845 equity shares aggregating to INR 5,906.90 million (net of QIP expenses of INR 93.09 million). As at March 31,2024 the Company has utilised INR 3,517.51 million towards purposes specified in the placement document and the balance amount of QIP's net proceeds remains invested in fixed and other deposits.
45. During the earlier years, Company had made a strategic, non-controlling investment in Talent Unlimited Online Services Private Limited (“Bobble”). The Company in its Board meeting held on May 14, 2022; had authorized the management to either divest or invest further in Bobble. Accordingly, the management had decided to and continues to classify the investment in Bobble as held for sale in accordance with Ind AS 105. The carrying value of the investment is INR 1,350.29 million for a 24.07% stake, on a fully diluted basis.
Further, during the current year the Company has recognised expenses of INR 24.08 million (March 31,2023: INR 75.45 million) as cost for services availed from Bobble.
47. PREVIOUS YEAR FIGURES
Previous year figures have been regrouped/reclassified wherever necessary, to confirm to this year's classification and figure for the year ended March 31,2024. The impact of regrouping/reclassification is not material to the financial statement
48. The financial statements were approved by board of directors on May 24, 2024
49. The company does not have any post balance sheet date event to be reported.
As per our report of even date attach
For Walker Chandiok & Co LLP For and on behalf of the Board of Directors of
Chartered Accountants Affle (India) Limited
ICAI Firm's Registration CIN No: L65990DL1994PLC408172
No.: 001076N/N500013
Ashish Gupta Anuj Khanna Sohum Vipul Kedia
Partner Managing Director & Executive Director
Membership No: 504662 Chief Executive Officer (DIN: 08234884)
Place: New Delhi (DIN: 01363666) Place: Gurugram
Date: May 24, 2024 Place: Singapore Date: May 24, 2024
Date: May 24, 2024
Kapil Mohan Bhutani Parmita Choudhury
Chief Financial & Operations Officer Company Secretary
Place: Gurugram Membership No: 26261
Date: May 24, 2024 Place: Gurugram
Date: May 24, 2024
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