k) Cash and cash equivalents
Cash and cash equivalent in the standalone balance
sheet comprise cash at banks and on hand and short¬
term deposits with an original maturity of three months
or less, which are subject to an insignificant risk of
changes in value.
For the purpose of the standalone cash flow
statement, cash and cash equivalents consist of cash
at banks and on hand and deposits, as defined above,
net of outstanding loans repayable on demand from
banks as they are considered an integral part of the
Company's cash management.
l) Cash dividends to equity holders
Annual dividend distribution to the shareholders is
recognised as a liability in the period in which the
dividend is approved by the shareholders. Any interim
dividend paid is recognised on approval by Board
of Directors. Dividend payable on distribution is
recognised directly in equity.
m) Investments in subsidiary
The Company has elected to recognize its
investments in equity instruments in subsidiary at cost
in accordance with the option available in Ind AS 27,
‘Separate Financial Statements'.
2.3 Key accounting estimates, judgements and
assumptions
The preparation of the Company's standalone
financial statements requires management to make
judgements, estimates and assumptions that affect
the reported amounts of revenues, expenses, assets
and liabilities, and the accompanying disclosures, and
the disclosure of contingent liabilities. Uncertainty
about these assumptions and estimates could result
in outcomes that require a material adjustment to
the carrying amount of assets or liabilities affected in
future periods.
The key assumptions concerning the future and other
key sources of estimation uncertainty at the reporting
date, that have a significant risk of causing a material
adjustment to the carrying amounts of assets and
liabilities within the next financial year, are described
below:
a. Defined benefit plans and other long-term
benefit plan
The cost and present value of the defined benefit
gratuity plan and leave encashment (other long¬
term benefit plan) are determined using actuarial
valuations. 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 and
other long-term benefits are highly sensitive to
changes in these assumptions. All assumptions
are reviewed at each reporting date.
b. Useful lives of depreciable assets
Management reviews the useful lives of depreciable
assets at each reporting date, based on the
expected utility of the assets to the Company.
c. Leases
Ind AS 116 requires lessees to determine the lease
term as the non-cancellable period of a lease
adjusted with any option to extend or terminate
the lease, if the use of such option is reasonably
certain. The Company makes an assessment on
the expected lease term on a lease-by-lease basis
and thereby assesses whether it is reasonably
certain that any options to extend or terminate
the contract will be exercised. In evaluating the
lease term, the Company considers factors
such as any significant leasehold improvements
undertaken over the lease term, costs relating to
the termination of the lease and the importance
of the underlying asset to Company's operations
taking into account the location of the underlying
asset and the availability of suitable alternatives.
d. Expected credit loss on financial assets
On application of Ind AS 109, the impairment
provisions of financial assets are based on
assumptions about risk of default and expected
timing of collection. The Company uses judgement
in making these assumptions and selecting the
inputs to the impairment calculation, based on the
Company’s past history of collections, customer’s
credit-worthiness, existing market conditions as
well as forward looking estimates at the end of the
each reporting period.
2.4 Application of new standards and
amendments
The Ministry of Corporate Affairs notified new
standards or amendment to existing standards under
Companies (Indian Accounting Standards) Rules
as issued from time to time. The Company applied
following amendments for the first-time during the
current year which are effective from 1 April 2025:
Lack of exchangeability - Amendments to Ind AS
21
MCA via notification dated 7 May 2025, announced
amendments to Ind AS 21, The Effects of Changes
in Foreign Exchange Rates, to specify how an entity
should assess whether a currency is exchangeable
and how it should determine a spot exchange rate
when exchangeability is lacking. The amendments
also require disclosure of information that enables
users of its financial statements to understand how
the currency not being exchangeable into the other
currency affects, or is expected to affect, the entity’s
financial performance, financial position and cash
flows.
The amendments do not have a material impact on
the Company’s Standalone Financial Statements.
Classification of Liabilities as Current or
Non-current and Non-current Liabilities with
Covenants - Amendments to Ind AS 1
MCA via notification dated 13 August 2025 announced
amendments to Ind AS 1, Presentation of Financial
Statements, which elaborate on guidance set out in
Ind AS 1 by:
• clarifying that the right to defer settlement of a
liability for at least 12 months after the reporting
period; a) must have substance, and b) must exist
at the end of the reporting period;
• stating that management's expectations around
whether the settlement of a liability would be
deferred or not, does not impact the classification
of the liability;
• including requirements for liabilities that can be
settled using an entity's own instruments; and
• stating that at the reporting date, the entity does
not consider covenants that will need to be
complied with in the future when considering the
classification of the debt as current or non-current
The amendments do not have a material impact on
the Company's Standalone Financial Statements.
Supplier Finance Arrangements - Amendments
to Ind AS 7 and Ind AS 107
MCA via notification dated 13 August 2025 announced
amendments to Ind AS 7, Statement of Cash Flows
and Ind AS 107, Financial Instruments: Disclosures
which introduced disclosure requirements with the
objective to enable users of financial statements to
assess how supplier finance arrangements affect an
entity's liabilities, cashflows and exposure to liquidity
risk.
The amendments do not have a material impact on
the Company's Standalone Financial Statements.
International Tax Reform - Pillar Two Model
Rules - Amendments to Ind AS 12
MCA via notification dated 13 August 2025 announced
amendments to Ind AS 12, Income Taxes, which
includes:
• a temporary exception to the recognition and
disclosure of deferred taxes arising from the
implementation of the Pillar Two model rules; and
• additional disclosure requirements targeted at
a reporting entity's exposure to income taxes in
periods in which the Pillar Two Model legislation
is enacted or substantively enacted but not yet in
effect.
The amendments do not have a material impact on
the Company's Standalone Financial Statements.
2.5 New standards and amendments to existing
Standards which are issued but are not yet
effective and have not been early adopted by the
Company
Classification of Liabilities as Current or
Non-current and Non-current Liabilities with
Covenants - Amendments to Ind AS 1
Paragraph 74 of Ind AS 1 currently effective for the
year ended 31 March 2026 requires the entity not to
classify the liability as current, if there is a breach of a
material covenant of a long-term loan arrangement on
or before the end of the reporting period with the effect
that the liability becomes payable on demand on the
reporting date, however, the lender agreed, after
the reporting period and before the approval of the
financial statements for issue, not to demand payment
as a consequence of the breach.
MCA vide notification dated 13 August 2025, has
introduced amendment under Paragraph 74 of Ind AS
1 which requires the entity to classify the liability as
current under the aforementioned situation because,
at the end of the reporting period, it does not have the
right to defer its settlement for at least twelve months
after that date. Such amendment has been made
effective for annual reporting periods beginning on or
after 01 April 2026 retrospectively in accordance with
Ind AS 8.
This amendment is not expected to have a material
impact on the Company's Standalone Financial
Statements.
(a) Represents loan given to R V Consulting Services Private Limited (enterprise in which relative of a KMP exercise control)
to earn better return on its surplus funds. The loan carries interest rate in the range of 7.50% - 8.50% per annum and
repayable within 12 months from the date of disbursement. During the year, the Company has renewed both the loans
aggregating to 11,300 which had fallen due for repayment.
(b) No loans are granted to promoters, directors, KMPs and the related parties (as defined under the Companies Act, 2013)
either severally or jointly with any other person, that are either (i) repayable on demand; or (ii) without specifying any terms
or period of repayment.
iv. Rights, preferences and restrictions attached to equity shares
The Company has only one class of issued, subscribed and paid up equity shares having a par value of 110 each per
share. Each holder of equity shares is entitled to one vote per share. The Company declares and pays dividend in Indian
rupees. The dividend proposed by the Board of Directors is subject to the approval of the shareholders in the Annual
General Meeting.
In the event of liquidation of the Company, the holders of equity shares will be entitled to receive remaining assets of
the Company, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity
shares held by the shareholders.
vi. Aggregate number of equity shares issued for consideration other than cash:
During the year ended 31 March 2022, the Company has issued 6,32,238 equity shares of 110 each to Mr. Satish Chander
Reddy Kalva, against acquisition of 100% stake in ITCATS LLC, USA. The Company has not issued any equity shares pursuant
to contract without payment being received in cash or by way of bonus shares or bought back any equity shares during the
last five year preceding the balance sheet date, except as mentioned above.
vii. Aggregate number of equity shares issued as bonus and shares bought back during the period of five years immediately
preceding the reporting date is "Nil".
Nature and purpose of reserves:
A. Securities premium
The amount received in excess of face value of the equity shares is recognised in the securities premium. This reserve will be
utilised in accordance with the provisions of Section 52 of the Act.
B. Retained earnings
Retained earnings are the profits that the Company has earned till date, less any transfers to general reserve, dividends or
other distribution to the shareholders.
C. Remeasurement of defined benefit plan, net of tax
This amount represents actuarial gains or losses arising from the remeasurement of defined benefit obligations (i.e. gratuity),
which are recognized in Other Comprehensive Income (OCI) and not reclassified to profit or loss.
B. Disclosure under Micro, Small and Medium Enterprises Development Act, 2006
The creditors covered by Micro, Small and Medium Enterprises Development Act, 2006 ("the MSMED Act,
2006") have been identified on the basis of information available with the Company. Disclosures in respect
of the amounts payable to such parties are given below:
* The proposed final dividend, is subject to the approval of shareholders in the ensuing Annual General Meeting of the Company and accordingly
not recognized as a liability in accordance with the applicable accounting principles.
Note: The Company has paid a dividend of 12.00 per share during the year ended 31 March 2026 (31 March 2025: 12.00 per share), pertaining
to such dividend declared for the previous financial year amounting to 1127.84 (31 March 2025: 1127.84).
28. Categories of Financial instruments and their fair values
The carrying amount of all financial assets and financial liabilities appearing in the financial statements are carried at
amortised cost and are reasonable approximation of their fair values.
The fair value of the financial assets and financial liabilities are included at an amount at which the instruments could be
exchanged in a current transaction between the willing parties, other than in a forced or liquidation sale.
29. Financial risk management objectives and policies
Financial Risk Management Framework
The Board of Directors is responsible for developing and monitoring the Company's risk management policies.
The Company's principal financial liabilities comprises of borrowings, trade and other payables. The main purpose of
these financial liabilities is to finance the Company's operations. The Company's principal financial assets include loans,
trade and other receivables and cash and bank balances that the Company derives directly from its operations.
The Company is exposed primarily to credit risk, liquidity risk and market risk, which may adversely impact the fair value
of its financial instruments. The Company assesses the unpredictability of the financial environment and seeks to mitigate
potential adverse effects on the financial performance of the Company.
A. 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. Credit risk encompasses of both, the direct risk of default and the risk of deterioration
of creditworthiness as well as concentration of risks. Credit risk arises primarily from financial assets such as trade
receivables, balances with banks and loan and other receivables.
Credit risk is controlled by analyzing credit limits and creditworthiness of customers on a continuous basis to whom
the credit has been granted after obtaining necessary approvals for credit. Financial instruments that are subject to
concentrations of credit risk principally consist of trade receivables, cash and bank balances and loans. None of the
financial instruments of the Company result in material concentration of credit risk.
Exposure to credit risk:
The carrying amount of financial assets represents the maximum credit exposure. The maximum exposure to credit
risk was 14,103.52 as of 31 March 2026 (31 March 2025: 14,072.34) being the total of the carrying amount of financial
assets.
. Financial assets that are neither past due nor impaired:
None of the Company's cash equivalents, loans and other financial assets were either past due or impaired as at 31
March 2026 and 31 March 2025. The Company has diversified its portfolio of investment in cash and cash equivalents
and term deposits with various banks which have secure credit ratings, hence the risk is reduced. Loans given to related
parties are tested for impairment where there is an indicator. Other financial assets represent security deposits given to
lessors and other assets. Credit risk associated with such deposits and other assets is relatively low.
Financial assets that are past due but not impaired:
The Company's credit period for customers generally 30 days. The ageing of trade receivables that are past due but not
impaired is given below:
Ind AS requires expected credit losses to be measured through a loss allowance. The Company assesses at each
balance sheet date whether a financial asset or a group of financial assets are impaired. Expected credit losses are
measured at an amount equal to the 12 month expected credit losses or at an amount equal to the life time expected
credit losses if the credit risk on the financial asset has increased significantly since initial recognition. The Company has
used a practical expedient by computing the expected credit loss allowance for trade receivables based on a provision
matrix if they are past due. The provision matrix takes into account historical credit loss experience and is adjusted for
forward-looking information. Based on such data, loss on collection of receivables is not material, hence no additional
provision considered.
B. Liquidity risk
Liquidity risk refers to the risk that the Company cannot meet its financial obligations. The objective of liquidity risk
management is to maintain sufficient liquidity and ensure that funds are available for use as per requirements. The
Company manages liquidity risk by maintaining cash and cash equivalents and the cash flows generated from operations.
The table below summarises the maturity profile of the Company's financial liabilities based on contractual undiscounted
payments:
C. Market risk:
Market risk is the risk that changes in market prices, such as foreign exchange rates and interest rates will affect the
Company's income. Market risk is attributable to all market risk sensitive financial instruments including foreign currency
receivables and payables and long term debt. The objective of market risk management is to manage and control market
risk exposures within acceptable parameters, while optimising the return.
i. Foreign currency risk:
Currency risk is the risk that the value of a financial instrument will fluctuate due to changes in foreign exchange rates.
The Company operates internationally in foreign currencies and is exposed to the risk of change in foreign exchange
rates which relates primarily to the Company's operating activities. Foreign exchange risk arises from transactions
denominated in a currency that is not the functional currency of the Company.
The Company has transactional currency exposures arising from services provided or availed that are denominated
in a currency other than the functional currency. The foreign currencies in which these transactions are denominated
are mainly in US Dollars ($). The Company's trade receivable balances at the end of the reporting period have similar
exposures.
ii. Interest rate risk:
Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of
changes in market interest rates. The Company's borrowing during the current year and previous year comprised of
vehicle loans which carried a fixed rate of interest, which did not expose it to interest rate risk.
30. Capital Risk Management
Capital includes equity capital and all other reserves attributable to the equity holders of the company. The primary
objective of the capital management is to ensure that it maintain an efficient capital structure and healthy capital ratios in
order to support its business and maximise shareholder's value. The Company manages its capital structure and make
adjustments to it, in light of changes in economic conditions or its business requirements. To maintain or adjust the capital
structure, company may adjust the dividend payment to shareholders return capital to shareholders or issue new shares.
The Company monitors capital using a debt to capital employed ratio which is debt divided by total capital plus debt.
The Company's policy is to keep this ratio at an optimal level to ensure that the debt related covenants are complied
with.
31. Disclosure pursuant to requirements of Rule 11(e) (i) & (ii) of the Companies (Audit and Auditors) Rules
(i) No funds have been advanced or loaned or invested (either from borrowed funds or share premium or any other
sources or kind of funds) by the Company to or in any other person(s) or entity(ies), including foreign entities
(“Intermediaries”) with the understanding, whether recorded in writing or otherwise, that the Intermediary shall lend
or invest in party identified by or on behalf of the Company (Ultimate Beneficiaries).
(ii) The Company has not received any fund from any party(s) (Funding Party) with the understanding that the Company
shall whether, directly or indirectly lend or invest in other persons or entities identified by or on behalf of the Company
(“Ultimate Beneficiaries”) or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.
32. Contingent liabilities and Commitments
There are no contingent liabilities and outstanding commitments as at 31 March 2026 and 31 March 2025.
33. In accordance with Ind AS 108, Operating segments, segment information has been provided in the consolidated
financial statements of the Company and no separate disclosure on segment information is given in these standalone
financial statements.
Note:
(i) All KMP's excluding S Sreekanth Reddy, are covered by the Company's Mediclaim insurance policy and are eligible
for gratuity along with other employees of the Company. The proportionate premium paid towards this policy and
provision made for gratuity pertaining to such KMP's has not been included in the aforementioned disclosures as
these are not determined on an individual basis.
(ii) All transactions with these related parties are priced on an arm's length basis and are to be settled in cash. None of
the balances are secured and no guarantees are extended to the related parties.
(iii) Refer 9(a) for terms of loan provided to R V Consulting Services Private Limited
35. Gratuity
The Company provides its employees with benefits under a defined benefit plan, referred to as the "Gratuity Plan".
The Gratuity Plan entitles an employee, who has rendered at least five years of continuous service, to receive 15 days
salary for each year of completed service (service of six months and above is rounded off as one year) at the time of
retirement/ exit, restricted to a sum of 120 in accordance with Payment of Gratuity Act, 1972. The Company maintains
its investments with Life Insurance Corporation of India, to fund its gratuity plan.
(ix) The Company expects to contribute 112.75 (31 March 2025: Nil) towards gratuity within one year from the year
ended 31 March 2026 and 31 March 2025.
(x) Risk exposures:
Valuation are based on certain assumptions, which are dynamic in nature and may vary over time. As such
valuations of the Company is exposed to following risks -
a) Salary escalation: Higher than expected increases in salary will increase the defined benefit obligation.
b) Discount rate: The defined benefit obligation calculated use a discount rate based on government bonds. If bond
yield fall, the defined benefit obligation will tend to increase.
c) Mortality rate: If the actual death cases are lower or higher than assumed in the valuation, it can impact the
defined benefit obligation.
d) Withdrawals: If the actual withdrawal are higher or lower than the assumed withdrawals or there is a change
in withdrawal rates at subsequent valuations, it can impact defined benefit obligation.
36. Additional disclosures
(i) No proceedings have been initiated on or are
pending against the Company for holding
benami property under the Benami Transactions
Prohibition Act, 1988 (45 of 1988) and Rules made
thereunder.
(ii) The Company has not taken borrowings from
banks or financial institutions on the basis of
security of current assets.
(iii) The Company has not been declared willful
defaulter by any bank or financial Institution or
other lender.
(iv) No transactions are carried out with companies
struck off under section 248 of the Act or section
560 of Companies Act, 1956.
(v) No charges or satisfaction yet to be registered with
ROC beyond the statutory period.
(vi) The Company has complied with the number of
layers prescribed under clause (87) of section 2
of the Act read with Companies (Restriction on
number of Layers) Rules, 2017.
(vii) No Scheme of Arrangements has been approved
by the Competent Authority in terms of sections
230 to 237 of the Act.
(viii) 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.
(ix) The Company has not traded or invested in crypto
currency or virtual currency during the current or
previous year.
37. Audit trial
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, in respect of financial year commencing
on 1 April 2025 has used an accounting software
"Tally Prime 4.0 (Edit Log)" for maintaining its books
of account for the period 01 April 2025 to 31 March
2026. As the Company had migrated from Tally Prime
2.1" w.e.f. 1 June 2023, the backup of books of
accounts for the period 1 April 2023 to 31 May 2023
could not be maintained.
*Not applicable
Note 1: The change in the aforesaid ratios beyond 25% as compared to the previous financial year is mainly on account
of reduction in revenue from operations during the year. Since the Company major operating costs could not be reduced
in the same proportion as the decline in revenue. Consequently, profitability during the year was impacted, resulting in
significant variation in profitability and return-related ratios.
This is the summary of material accounting
policies and other explanatory information
referred to in our report of even date.
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