Accounting Policies of Octaware Technologies Ltd. Company

Mar 31, 2025

2.1. Significant accounting policies:

a. AS - 1 Disclosure of accounting policies : -

The Financial statements are prepared under the accrual basis following the
historical cost convention in accordance with generally accepted accounting
principles (GAAP), and pursuant to section 133 of the companies act, 2013 read
with Rule 7 of the Companies (Accounts) rules,2014, till the standards of
accounting or any addendum thereto are prescribe by central government.
These financial statements have been prepared to comply in all material aspects
with the accounting standards notified under section 211(3C) [Companies
(Accounting Standards) Rules,2006 as amended] and other relevant provisions
of the companies act,2013 (the ''Act'').

The presentation of financial statements requires estimates and assumption to
be made that affect the reported amount of assets & Liabilities on the date of
financial statements and the reported amount of revenue and expenses during
the reporting period. Difference between the actual result and estimates are
recognized in the period in which results are known/materialized.

b. AS - 2 Valuation of Inventory : -

AS-2 is not applicable to the Company, as it does not hold any inventory during
the year.

c. AS - 4 Contingencies and Events Occurring After the Balance Sheet
Date:-

Effects of, events occurred after Balance Sheet date and having material effect
on financial statements are reflected in the accounts at appropriate places.

d. AS - 5 Net Profit or loss for the period, prior period items and changes
in accounting policies : -

Material items of prior period, non-recurring and extra ordinary items are
shown separately, If any.

e. AS - 9 Revenue Recognition :-

Sale of service is recognized at the point of rendering of service to customers,
sales are exclusive of Service Tax, GST and Freight Charges if any. The revenue
and expenditure are accounted on a going concern basis.

Dividend from investments in shares / units is recognized when the company
declares

Other items of Income are accounted as and when the right to receive arises

f. AS - 10 Accounting for Property, Plant and Equipment :-

All items of Plant, Property and Equipment are initially recognized at cost and
subsequently carried at cost less accumulated depreciation and accumulated
impairment losses. All items are depreciated as per Written Down Value method
over the useful life as prescribed under Schedule II of Companies Act, 2013.

The cost of an item of property, plant and equipment initially recognized
includes its purchase price and any cost that is directly attributable to bringing
the asset to the location and condition necessary for it to be capable of
operating in the manner intended by management. Cost also includes borrowing
costs that are directly attributable to the acquisition, construction or production
of a qualifying asset.

Fixed assets are stated at cost less accumulated depreciation. Cost comprises
the purchase price and any other attributable cost of bringing the asset to its
working condition for its intended use less CENVAT claimed.

g. AS - 11 Accounting for effects of changes in foreign exchange rates :-

(a) . Transactions denominated in foreign currencies are normally recorded at
the exchange rate prevailing at the time of the transactions.

(b) . Any income or expenses on account of exchange difference either on
settlement or on Balance sheet Valuation is recognized in the profit and loss
account except in cases where they relate to acquisition of fixed assets in which
case they are adjusted to the carrying cost of such assets.

(C). Foreign currency transactions accounts are given in the notes of accounts.

h. AS - 12 Accounting for Government Grants :-

Capital subsidiary receivable specific to fixed assets is treated as per accounting
standard 12 and other revenue grants is recorded as revenue items.

i. AS-13: Accounting for Investments: -

a) Current investments are valued at the lower of cost and fair value.

b) Long-term investments are carried at cost. Provision for diminution is
made if such decline is other than temporary.

j. AS - 15: Accounting for Employee Benefits :-

a. Provident Fund :-

Provident fund is a defined contribution scheme as the company pays
fixed contribution at pre-determined rates. The obligation of the
company is limited to such fixed contribution. The contributions are
charged to Profit & Loss A/c.

a. Short-term benefits such as salaries, bonus, and leave encashment
(due within 12 months) are recognized on an undiscounted basis.

b. Gratuity is a defined benefit plan. The liability for gratuity is recognized
based on the actuarial valuation using the Projected Unit Credit Method, in
accordance with applicable rules and historical trends.

c. Leave encashment is a defined benefit plan. The liability is recognized
based on management''s estimates and not through actuarial valuation

k. AS - 16 Borrowing Cost :-

Borrowing costs directly attributable to the acquisition of qualifying assets are
capitalized till the same is ready for its intended use. A qualifying asset is one
that necessarily takes substantial period of time to get ready for intended use.
All other borrowing cost is charged to revenue.

l. AS-17: Segment Reporting:-

AS-17 is not applicable to the Company, as it does not fall under the criteria
prescribed for segment reporting.

m. AS - 18 Related Party Disclosure :-

The Disclosures of Transaction with the related parties as defined in the related
parties as defined in the Accounting Standard are given in notes of accounts.

n. AS - 19 Accounting for Leases :-

The Company has not entered into any lease agreements during the year.

o. AS - 20 Earnings Per Share :-

Disclosure is made in the Notes of accounts as per the requirements of the
standard.

p. AS - 22 Accounting for Taxes on Income :-
Current Tax:-

Provision for current tax is made after taken into consideration benefits
admissible under the provisions of the Income Tax Act, 1961.

Deferred Taxes:-

Deferred Income Tax is provided using the liability method on all temporary
difference at the balance sheet date between the tax basis of assets and
liabilities and their carrying amount for financial reporting purposes.

1. Deferred Tax Assets are recognized for all deductible temporary
differences to the extent that it is probable that taxable profit will be
available in the future against which this items can be utilized.

2. Deferred Tax Assets and liabilities are measured at the tax rates that
are expected to apply to the period when the assets is realized or the
liability is settled, based on tax rates ( and the tax) that have been
enacted or enacted subsequent to the balance sheet date.

q. AS - 24 Discontinuing Operations :-

During the year the company has not discontinued any of its operations.

r. AS - 26: Intangible Assets:

The Company has only one intangible asset, software, whose useful life has
expired and is no longer amortized. Software development costs related to
intangible assets under development have been capitalized per AS-26 and will
be amortized once available for use.

s. AS - 29 Provisions Contingent liabilities and contingent assets :-

• Provisions involving substantial degree of estimation in measurement are
recognized when there is a present obligation as a result of past events
and it is probable that there will be an outflow of resources.

• Contingent Liabilities are not recognized but are disclosed in the notes.

• Contingent Assets are neither recognized nor disclosed in the financial
statements.

• Provisions, Contingent Liabilities and Contingent Assets are reviewed at
each Balance Sheet Date.

For D G M S & CO. For and on behalf of the Board of Directors of

Chartered Accountants Octaware Technologies Limited

F R No. 0112187W

Hiren J. Maru Mohammed Aslam Khan Shahnawaz Aijazuddin Shaikh

Partner Managing Director Whole-Time Director & CFO

M. No. 115279 DIN No: 00016438 DIN No. 06910575

Place: Mumbai Place: Mumbai Place: Mumbai

Date: 30^th May, 2025 Date : 30^th May 2025 Date : 30^th May 2025

Anwer Hussien Bagdadi
Chief Executive Officer

Place: Mumbai
Date : 30^th May 2025

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Mar 31, 2024

2.1. Significant accounting policies:

a. AS - 1 Disclosure of accounting policies : -

The Financial statements are prepared under the accrual basis following the
historical cost convention in accordance with generally accepted accounting
principles (GAAP), and pursuant to section 133 of the companies act, 2013 read
with Rule 7 of the Companies (Accounts) rules,2014, till the standards of
accounting or any addendum thereto are prescribe by central government.
These financial statements have been prepared to comply in all material aspects
with the accounting standards notified under section 211(3C) [Companies
(Accounting Standards) Rules,2006 as amended] and other relevant provisions
of the companies act,2013 (the ''Act'').

The presentation of financial statements requires estimates and assumption to
be made that affect the reported amount of assets & Liabilities on the date of
financial statements and the reported amount of revenue and expenses during
the reporting period. Difference between the actual result and estimates are
recognized in the period in which results are known/materialized.

b. AS - 2 Valuation of Inventory : -

Raw Material : At Lower of Cost or Net realizable value.

Semi-finished goods : At estimated cost.

Finished goods : At Lower of Cost or Net Realizable Value

c. AS - 4 Contingencies and Events Occurring After the Balance Sheet Date

Effects of, events occurred after Balance Sheet date and having material effect
on financial statements are reflected in the accounts at appropriate places.

d. AS - 5 Net Profit or loss for the period, prior period items and changes
in accounting policies : -

Material items of prior period, non-recurring and extra ordinary items are
shown separately, If any.

e. AS - 9 Revenue Recognition :-

Sale of service is recognized at the point of rendering of service to customers,
sales are exclusive of Service Tax, GST and Freight Charges if any. The revenue
and expenditure are accounted on a going concern basis.

Dividend from investments in shares / units is recognized when the company.

Other items of Income are accounted as and when the right to receive arises

f. AS - 10 Accounting for Property, Plant and Equipment :-

All items of Plant, Property and Equipment are initially recognized at cost and
subsequently carried at cost less accumulated depreciation and accumulated
impairment losses. All items are depreciated as per Written Down Value method
over the useful life as prescribed under Schedule II of Companies Act, 2013.

The cost of an item of property, plant and equipment initially recognized
includes its purchase price and any cost that is directly attributable to bringing
the asset to the location and condition necessary for it to be capable of
operating in the manner intended by management. Cost also includes borrowing
costs that are directly attributable to the acquisition, construction or production
of a qualifying asset.

Fixed assets are stated at cost less accumulated depreciation. Cost comprises
the purchase price and any other attributable cost of bringing the asset to its
working condition for its intended use less CENVAT claimed.

g. AS - 11 Accounting for effects of changes in foreign exchange rates :-

(a) . Transactions denominated in foreign currencies are normally recorded at
the exchange rate prevailing at the time of the transactions.

(b) . Any income or expenses on account of exchange difference either on
settlement or on Balance sheet Valuation is recognized in the profit and loss

account except in cases where they relate to acquisition of fixed assets in which
case they are adjusted to the carrying cost of such assets.

(C). Foreign currency transactions accounts are given in the notes of accounts.

h. AS - 12 Accounting for Government Grants :-

Capital subsidiary receivable specific to fixed assets is treated as per accounting
standard 12 and other revenue grants is recorded as revenue items.

i. AS - 15 Employees Retirement Benefit Plan :-

a. Provident Fund :-

Provident fund is a defined contribution scheme as the company pays
fixed contribution at pre-determined rates. The obligation of the
company is limited to such fixed contribution. The contributions are
charged to Profit & Loss A/c.

j. AS - 16 Borrowing Cost :-

Borrowing costs directly attributable to the acquisition of qualifying assets are
capitalized till the same is ready for its intended use. A qualifying asset is one
that necessarily takes substantial period of time to get ready for intended use.
All other borrowing cost is charged to revenue.

k. AS - 18 Related Party Disclosure :-

The Disclosures of Transaction with the related parties as defined in the related
parties as defined in the Accounting Standard are given in notes of accounts.

l. AS - 19 Accounting for Leases :-

The Company has not entered into any lease agreements during the year.

m. AS - 20 Earnings Per Share :-

Disclosure is made in the Notes of accounts as per the requirements of the
standard.

n. AS - 22 Accounting for Taxes on Income :-
Current Tax:-

Provision for current tax is made after taken into consideration benefits
admissible under the provisions of the Income Tax Act, 1961.

Deferred Taxes:-

Deferred Income Tax is provided using the liability method on all temporary
difference at the balance sheet date between the tax basis of assets and
liabilities and their carrying amount for financial reporting purposes.

1. Deferred Tax Assets are recognized for all deductible temporary
differences to the extent that it is probable that taxable profit will be
available in the future against which this items can be utilized.

2. Deferred Tax Assets and liabilities are measured at the tax rates that
are expected to apply to the period when the assets is realized or the
liability is settled, based on tax rates ( and the tax) that have been

enacted or enacted subsequent to the balance sheet date.

o. AS - 24 Discontinuing Operations

During the year the company has not discontinued any of its operations.

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Mar 31, 2018

NOTES TO FINANCIAL STATEMENTS FOR THE YEAR ENDED 31ST MARCH, 2018

Note No. -1

Corporate information

The company is established on 26th May 2005 to carry on the business of developing, designing and servicing comparer software and information technology related applications and systems.

The Company has the following subsidaries and associates: ij OCTAWARE GULF FZE al Dubai.(100 % WOS)

>OCTAWARE INFORMATION TECHNOLOGIES PRIVATE LIMITED at SEZ Andheri [East], Mumbai. [99.375%)

iii OCTAWARE GULF OFC at Quarter (100% WOS

iv TRANSPACT ENTERPRISES PVT. LTDr (Associate Co. Significant-accounting policies

A. Accounting Convention

The Financial statements have been prepared to comply in all material respects with the mandatory Acccounting Standards issued by the Institute of Chartered Accountants of India and the relevant provisions of the Companies Act .2013.

The financial statements have been prepared under the historical cost convention on an accural basis. The accounting policies have been consistently applied by the Company.

All the figures as entered in the financial statements are rounded off to the nearest rupee one.

B., Use of Estimates

Preparation of the financial statements in conformity with Generally Accepted Accounting Principles requires. estimates and assumptions to be made that affect the reported amounts of revenues and expenses during the reported period. The estimates and assumptions used in the accompanyng: financial statements-are prudent and based on management''s evaluation of the relevant facts and circumstances as at the date of the financial statements.

Differences between the actual results and estimates are recognised in the period in which the results are known/ materialised.

C. Recognition Revenue and Expenditure

Revenue from time and material contracts are recognized as related services are performed.

Expenses have been accounted for on accrual basts and provision has been made for all known losses and expenses.

D. Fixed Assets

Fixed Assets have been stated at cost less accumulated depreciation, cost comprises the basic price, duty and any other attributable cost for bringing the asset to its working condition for its intended use.

E. Depreciation

The depredation is provided on written Down value Method at me rates prescribed in schedule- II of the companies-Act 2013 or management estimate whichever is higher. If the management''s estimate of the useful life of a fixed asset at the time of acquisition of the asset or of the remaining useful life on a subsequent review is shorter than that envisaged in the aforesaid schedule depreciation is provided at a higher rate based on management''s estimate of the useful life/ remaining useful life.

In respect of the additions to assets made during the year, depredation for the year is calculated from the date on which the additions are made

F. Foreign Currency Transactions

Transactions in foreign currencies are recorded at the exchange rates prevailing at the date of the transactions:. Exchange differences arising on foreign currency transactions are recognised as income or expense in the year in which they arise.

Monetary assets and liabilities denominated in foreign currency at the balance sheet date are translated at the year end exchange rate and the resultant exchange differences are recognized in the profit and loss account. n case of monetary items which are covered by Forward Exchange Contracts, Premium or Discount on Forward exchange Contract is recognised over the line of the contract.

Non monetary foreign currency items are carried at cost.

G, Retirement Benefits

Short term Employee Benefits: All employee benefits payable wholly within twelve months of rendering the service are classified as short term employee benefits- Benefits such as salary,, performance incentives etc. are recognised as an expense at the undiscounted amount in the profit & loss account for the year in which the employee renders the related service.

Post employment benefits:

Defined Contribution Plans:

Provident Fund: The eligible employees of the Company are entitled to receive benefits under the provident fund,, a defined contribution plan, in which both employees and the company make monthly contributions at a specified percentage of the covered employees salary , currently 1256 of employees'' basic salary). The contributions as specified under the Law are paid and charged to Profit & LOSS Account of the year when the contribution to the fund is due.

Long Term Employee- Benefits: Defined Benefit Plans:

Gratuity: The company has an obligation towards gratuity, a defined benefit retirement plan covering eligible employees. | Gratuity & leave encashment provision nut required hence no provision made at the end of the year The company accounts for the liability for gratuity benefits payable in future based on actuarial valuation carried out by an Independent actuary.

No provision for leave encashment is made as company''s policy do not allow carry forward of leaves. All the leaves standing to the credit of the employee at the year end are encashed to the employee.

H. Leases

Assets taken cm leaseare accounted for in accordance with Accounting Standard 19 -on Leases (AS 19) operating lease

Assets taken on lease under which all risks and rewards of ownership are effectively retained by the lessor are classified as operating lease. Lease payments under operating leases are recognized as expenses on accrual basis in accordance with the respective lease agreements.

I. Provisions for Taxation

Tax expense companies both -current and deferred taxes. Provision is made for current income tax based on the tax Liability computed after considering tax allowances & exemptions.

From the Assessment Year 2008-09, the Company is subject to provisions of Minimum Alternate Tax. Credit for the advance Minimum Alternate Tax paid during the year by the Company is accounted far in accordance with the Guidance Note- ''Accounting for Credit Available in respect of Minimum Alternate Tax under The Income Tax Act 1961'' issued by the Institute of Chartered Accountants of India (ICAI)

Deferred tax assets and liabilities are recognized for future tax consequence attributable to timing difference between taxable income and accounting income that are capable of reversing in one or more subsequent periods and are measured at relevant enacted/ substantively enacted tax rates. At each balance sheet date, the-Company reassesses unrealized deferred tax assets to the extent they become reasonably certain or virtually certain of realization, as the case may be.

J.. Impairment of Assets

At each Balance Sheet date, the Management reviews the carrying amounts of its assets included in each cash generating unit to determine whether there is any indication that those assets suffered an impairment loss.

If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss. Recoverable amount is the higher of an asset''s net selling price and value in use. In assessing the value in use. the estimated Future cash flows expected from the continuing use of the asset and from its ultimate disposal are discounted to their present values using a pre-determined discount rate that reflects the current market assessments of the time value of money and risks specific to the asset.

An impairment loss is charged to the Profit and Loss Account in the year in which an asset is identified as impaired. An impairment loss recognized in prior accounting periods is reversed if there has been a change in the estimate of the recoverable amount.

K. Provisions, Contingent Liabilities and Contingent Assets

As per Accounting Standard 29, ''Provisions, Contingent Liabilities and Contingent Assets'',, issued by the Institute of Chartered Accountants of India, the Company recognizes provisions only when it has a present obligation as a result of past event, it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation as and when a reliable estimate of the amount of obligation can be made.

L. Provision is recognized for.

a) Any possible obligation that arises from past events and the existence of which will be confirmed only by the occurrence or non occurrence of one or more uncertain future events not wholly within the control of the company, or

b) Any present obligation that arises from past events but is not recognized because

i. It is not probable that an outflow of resources embodying economic benefits will be required to settle the obligation; or

ii. A reliable estimate of the amount of Derivation cannot be made.

Such obligations are recorded as Contingent Liabilities. These are assessed periodically and only mat part of the obligation for which an outflow of resources embodying economic benefits is probable, is provided for, except in the extremely rare circumstances where no reliable estimates can be made.

Contingent Assets are not recognized in the financial statements since this may result in the recognition of income that may never be realized.

L Other Accounting: Policies

The Company follows generally accepted accounting principles in respect of accounting policies not specifically referred to heieinabove..

M. Intangible Assets

Intangible assets are recognised only if it is probable that he future economic benefits that are attributable to the assets will flow to me enterprise and the cost of the assets can be measured reliably. The intangible assets are recorded at cost and are earned at cost less accumulated amortisation and accumulated impairment losses, if any.

N. Inventory

Stock-in-trade is valued at lower of cost and net realisable value. Cost is computed based on First in First out (FIFO) basis in respect of procured materials. Cost also includes all charges incurred for bringing the inventories to their present location and condition.

O. Investment

Long Term Investments are stated at cost. Provision for diminution in the value of Long Term Investments is made only if such a decline is other than temporary. Current Investments are stated at lower of cost or net realizable value.