Accounting Policies of BAG Convergence Ltd. Company

Mar 31, 2024

a) Basis of accounting and preparation of financial statements

These financial statements have been prepared under the historical cost convention on a going concern basis, on the
accrual basis of accounting in accordance with the Generally Accepted Accounting Principles (GAAP) in India. Indian
GAAP comprises mandatory accounting standards as specified under the section 133 of the Companies Act, 2013 read
with Rule 7 of Companies (Accounts) Rules, 2014 and other accounting pronouncements of the Institute of Chartered
Accountants of India.

The financial statements are presented in Indian National Rupee (INR), the functional currency of the Company. Items
included in the standalone financial statements of the Company are recorded using the currency of the primary
economic environment in which the Company operates (the ''functional currency''). Foreign currency transactions are
translated into the functional currency using exchange rates at the date of the transaction. Foreign exchange gains and
losses from settlement of these transactions are recognised in the standalone statement of profit and loss. Foreign
currency denominated monetary assets and liabilities are translated into functional currency at exchange rates in effect
at the balance sheet date, the gain or loss arising from such translations are recognised in the standalone statement of
profit and loss.

All amounts included in the financial statements are reported in lakhs of Indian rupees except share and per share data,
unless otherwise stated. Due to rounding off, the numbers presented throughout the document may not add up
precisely to the totals and percentages may not precisely reflect the absolute figures.

b) Use of Estimates

The preparation of the financial statements is in accordance with Generally Accepted Accounting Principles. It requires
the management to make estimates and assumptions that affect the reported amounts of assets and liabilities,
disclosures relating to contingent liabilities as at the date of the financial statements and reported amounts of revenues
and expenses during the year. Actual results could differ from these estimates and a revision to such accounting
estimates is recognized in the accounting period in which such a revision takes place.

c) Depreciation

Depreciation on fixed asset is provided on Written down Value method at the rates and in the manner prescribed in
schedule II of the Companies Act, 2013.

d) Revenue Recognition

Revenues from Telecom value added services net of customer credit, is recognized on provision of services in terms of
revenue sharing agreements with the aggregator.

Advertisement revenue from sale of advertising time is recognized on the accrual basis when advertisements are
telecast in accordance with contractual obligations.

e) Cash and cash equivalents

Cash comprises cash on hand and demand deposits with banks. Cash equivalents are highly liquid investments that
are readily convertible into known amounts of cash and which are subject to insignificant risk of changes in value.

f) Tangible Fixed Assets
Tangible Fixed Assets

The Fixed assets are stated at cost less accumulated depreciation and impairment. Cost includes capital cost, freight,
installation cost, duties and taxes and other incidental expenses incurred during the construction/installation and
attributable to bringing the asset to its intended use. Fixed assets are further adjusted by the amount of CENVAT credit
available, wherever applicable.

Depreciation on fixed assets is provided as per WDV basis, based on the rates as per useful life prescribed in Schedule
II to the Companies Act, 2013.

Depreciation is provided on a pro-rata basis i.e. from the date on which asset is ready for use.

Depreciation for the year is recognised in the Statement of Profit and Loss.

Losses arising from retirement or gains or losses arising from disposal of fixed assets which are carried at cost are
recognized in the Statement of Profit and Loss.

g) Service tax input credit

Service tax input credit is accounted for in the books in the period in which the underlying service received is accounted
and when there is no uncertainty in availing / utilizing the credits.

h) Taxes on Income

Income-tax expense comprises current tax (i.e. amount of tax for the period determined in accordance with the income-
tax law) and deferred tax charge or credit (reflecting the tax effects of timing differences between accounting income
and taxable income for the period). Income-tax expense is recognised in Statement of Profit or Loss except that tax
expense related to items recognised directly in reserves is also recognized in those reserves.

Deferred tax in respect of timing differences which reverse after the tax holiday period is recognised in the year in
which the timing differences originate.