(i) The Company had formed in pursuant to the approval by the Board of Directors in the meeting held on 27/01/2022, a wholly owned subsidiary (WOS) namely Aurionpro Foundation has been formed as a section 8 company basis approval received from the Registrar of Companies on 03/03/2022.
(ii) The Company entered into a share purchase agreement dated 15/11/2021 for acquisition of majority stake 51% (through combination of subscription and acquisition i.e. partly by subscription of fresh equity to be issued and partly by acquiring the equity stake from existing shareholders) for consideration of INR 1,400 Lakhs in Toshi Automatic System Private Limited (TASPL), a Gaziabad, Uttar Pradesh based company, an innovator with products and solutions in Industrial, Public safety, Mass Transit segments on 04/09/2022. Pursuant to which, the Company has completed transaction and acquired 1,53,000 Equity Shares representing majority stake (51%) in TASPL at consideration of INR 1,400 Lakhs.
(iii) The Company was holding 51% stake in SC Soft Technologies Pvt. Ltd. as on 30/06/2022. The Investment committee of the Company at their meeting held on 01/07/2022 had approved acquisition of balance 49%
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stake in SC Soft Technologies Pvt. Ltd at value of INR 15.27 Lakhs, which has been acquired by the Company as on date and accordingly, SC Soft Technologies Pvt. Ltd. has become 100% subsidiary of the Company.
(iv) In order to support its wholly owned subsidiary (WOS) Aurionpro Payment Solutions Pvt. Ltd. (AuroPay)to set up operations, ramp up the necessary infrastructure and also to meet the specific criteria of Net Worth as required by RBI from time to time, during the quarter, the Company has made further investment and subscribed to 50,00,000 compulsory Convertible Preference Shares of the face value of INR.10/-each amounting to INR 500 lakhs after obtaining approval of the Investment Committee of the Board on 25/10/2022 and the Board on 31/10/2022.
AuroPay has received an in-principle approval from the Reserve Bank of India (RBI) on 04/05/2023 to operate as a Payment Aggregator under the Payment and Settlement Act, 2007. AuroPay can commence
Payment Aggregator business upon receiving the final Certificate of Authorization from RBI.
(2) Terms/ rights attached to equity shares
The Company has only one class of equity shares having a par value of ' 10 per share. Each holder of equity shares is entitled to one vote per share. In the event of liquidation of the Company, the holder of equity shares will be entitled to receive remaining assets of the Company. The distribution will be in proportion to the number of equity shares held by the shareholders.
(3) Shares issue under ESPS
During the year, the Company had launched Aurionpro Solutions Limited Employee Stock Purchase Scheme 2022('ASL ESPS 2022') and formed Aurionpro Solutions Limited-Employee Benefit Trust (ASL ESPS Trust') to administer the ESPS scheme as per the approval of the Board of Directors on 25th July, 2022 and Shareholders on 26th September, 2022. The Company has allotted & earmarked 10,00,000 shares to ASL ESPS Trust under ASL ESPS 2022.
(i) Capital Reserve
The Company recognise profit and loss on sale, purchase and cancellation of the Company's own equity instruments to capital reserve.
(ii) Securities Premium
Securities Premium Reserve is used to record premium on issuance of shares. The reserve is utilised in accordance with provisions of the Companies Act, 2013.
(iii) Capital Redemption Reserve
As per Companies Act 2013, capital redemption reserve is created when company purchases it own shares out of profits. A sum equal to nominal value of the shares so purchased is transferred to capital redemption reserve. The reserve is utilized in accordance with the provisions of section 69 of Companies Act, 2013
(iv) Retained Earnings
Retained earnings are the profits that the Company has earned till date, less any transfers to general reserve, dividends or other distributions paid to shareholders.
(v) Other Comprehensive Income
Other Comprehensive Income refers to items of income and expenses that are not recognized as a part of the profit and loss account.
(vi) Restructuring Reserve
Pursuant to the Demerger, the difference between the net assets & liabilities transferred is included in Restructuring Reserve (after adjusting Capital Reserve & General Reserve).
(i) The Company does not face a significant liquidity risk with regard to its lease liabilities as the current assets are sufficient to meet the obligations related to lease liabilities as and when they fall due.
(ii) Rental expense recorded for short-term leases was ' 156.67 lakhs (Previous year: ' 31.55 lakhs) for the year ended 31 March 2023.
(iii) Effective interest rate in the range of 10 % to 12.50% has been applied to lease liabiliites recognised in the balance sheet at the date of initial application.
(iv) Applied the exemption not to recognize right to use assets and liabilities for leases with less than 12 months of lease term on the date of initial application and Leases for which the underlying asset is of low value.
Employee Benefits Defined contribution plans
The Company makes contributions, determined as a specified percentage of employee salaries, in respect of qualifying employees towards provident fund, ESIC and other funds which is a defined contribution plan. The Company has no obligations other than to make the specified contributions. The contributions are charged to the Statement of Profit and Loss as they accrue.
Defined Benefit plans
The Company has a scheme for payment of gratuity to all its employees as per the provisions of the Payment of Gratuity Act, 1972. The Company provides for period end liability using the projected unit credit method as per the actuarial valuation carried out by independent actuary. The gratuity plan is a funded plan.
Equity share capital and other equity are considered for the purpose of Company's capital management. The Company manages its capital so as to safeguard its ability to continue as a going concern and to optimise returns to shareholders. The capital structure of the Company is based on management's judgement of its strategic and day-to-day needs with a focus on total equity so as to maintain investor, creditors and market
confidence.
Financial Instruments
(i) Valuation
All financial instruments are initially recognized and subsequently re-measured at fairvalue as described below:
The fair value of financial assets and liabilities are included at the amount at which the instrument could be exchanged in a current transaction between the willing parties, other than in a forced or liquidation sale.
The fair value of investment in quoted Equity Shares, Bonds, Government Securities, Treasury Bills and Mutual Funds is measured at quoted price or NAV.
The fairvalue of the remaining financial instruments is determined using discounted cash flow analysis.
The financial instruments are categorized into three levels based on the inputs used to arrive at fairvalue measurements as described below: Level 1: Quoted prices (unadjusted) in active markets for identical assets or liabilities; and
Level 2: Inputs other than the quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. Level 3: Valuation techniques for which the lowest level input that is significant to the fairvalue measurement is unobservable.
The Company's business activities expose it to a variety of financial risks, namely market risks, credit risk and liquidity risk.
The Company's focus is to foresee the unpredictability of financial markets and seek to minimize potential adverse effects on its financial performance.
The Company's financial liabilities comprise of borrowings, trade payable and other liabilities to manage its operation and the financial assets include trade receivables, deposits, cash and bank balances, other receivables etc. arising from its operation.
(i) Market risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market prices.Market prices comprise three types of risk: Foreign currency rate risk, interest rate risk and other price risks, such as equity price risk and commodity risk.
Interest Rate Risk
Interest rate risk can be either fair value interest rate risk or cash flow interest rate risk. Fair value interest rate risk is the risk of changes in fair values of fixed interest bearing investments because of fluctuations in the interest rates, in cases where the borrowings are measured at fair value through profit or loss. Cash flow interest rate risk is the risk that the future cash flows of floating interest bearing investments will fluctuate because of fluctuations in the interest rates.
Fair value sensitivity analysis for fixed-rate instruments
The Company does not account for any fixed-rate financial assets or financial liabilities at fair value through profit or loss. Therefore, a change in interest rates at the reporting date would not affect profit or loss.
Cash flow sensitivity analysis for floating-rate instruments : Since floating-rate instruments is Nil, hence impact for the reporting period is Nil. Equity Price Risk
The Company is exposed to equity price risks arising from equity investments which is not material.
Derivative Financial Instruments
The Company does not hold derivative financial instruments.
Credit Risk
Credit risk arises from the possibility that the counterparty will default on its contractual obligations resulting in financial loss to the Company. To manage this, the Company periodically assesses the financial reliability of customers, taking into account the financial conditions, current economic trends, and analysis of historical bad debts and ageing of accounts receivable.
Trade Receivables
Our historical experience of collecting receivables is that credit risk is low. Hence, trade receivables are considered to be a single class of financial assets. Credit risk has always been managed by each business segment through credit approvals, establishing credit limits and continuously monitoring the credit worthiness of customers to which the Company grants credit terms in the normal course of business.
Other Financial Assets
Credit risk on cash and cash equivalents is limited as the Company generally invests in deposits with banks and financial institutions with high credit ratings assigned by international and/or domestic credit rating agencies. Investments primarily include investment in liquid mutual fund units, quoted bonds issued by Government and Quasi Government organizations and certificates of deposit which are funds deposited at a bank for a specified time period.
Liquidity risk
Liquidity risk refers to risk of financial distress or extra ordinary high financing cost arising due to shortage of liquid funds in a situation where business conditions unexpectedly deteriorate and require financing. The Company's objective is to maintain at all times optimum levels of liquidity to meet its cash and collateral requirements. Processes and policies related to such risk are overseen by senior management and management monitors the Company's net liquidity position through rolling forecast on the basis of expected cash flows.
(ii) The Company did not have any transactions with companies struck off under Section 248 of the Companies Act, 2013 or Section 560 of
Companies Act, 1956 during the financial year.
(iii) The Company does not have any Benami property, where any proceeding has been initiated or pending against the Company for holding any Benami property
(iv) The Company has not been declared as a willful defaulter by any lender who has powers to declare a company as a willful defaulter at any time during the financial year or after the end of reporting period but before the date when the financial statements are approved.
(v) The Company does not have any cases where guarterly returns or statements of current assets filed by the Company with banks or financial institutions are not in agreement with the books of accounts.
(vi) The Company does not have any charges or satisfaction which is yet to be registered with ROC beyond the statutory period
(vii) The Company has not traded or invested in Crypto currency or Virtual Currency during the financial year.
(viii) 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 Company (Ultimate Beneficiaries), or
(b) provide any guarantee, security or the like to or on behalf of the Ultimate Beneficiaries
(ix) 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 Company 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,
(x) The Company does not have transaction which is not recorded in the books of accounts that has been surrendered or disclosed as income during the year in the tax assessments under the Income Tax Act, 1961 (such as, search or survey or any other relevant provisions of the Income Tax Act, 1961)
(xi) The Company has complied with the number of layers prescribed under clause (87) of section 2 of the Act read with the Companies (Restriction on number of Layers) Rules, 2017
Note 48.Prior Periods Comparative
The previous year figures have been regrouped / reclassified wherever necessary to make them comperable with those of the current year.
Note 49. Authorisation of Financial Statements
The financial statements were approved by the Board of Directors on 16th May, 2023.
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