అకౌంట్స్ గమనికలుPhysicswallah Ltd.

i. Provisions and contingencies

Provisions

Provisions are recognised 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.

When the Company expects some or all of a
provision to be reimbursed, the reimbursement is
recognised as a separate asset, but only when the
reimbursement is virtually certain. 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 recognised as a finance cost.

Contingencies

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.

j. Borrowing costs

General and specific borrowing costs that
are directly attributable to the acquisition,
construction or production of a qualifying asset
are capitalised during the period of time that is
required to complete and prepare the asset for its
intended use or sale. Qualifying assets are assets
that necessarily take a substantial period of time
to get ready for their intended use or sale. Other
borrowing costs are expensed in the period in
which they are incurred. Borrowing cost includes
exchange differences to the extent regarded as an
adjustment to the borrowing costs.

k. Retirement and other employee benefits

Expenses and liabilities in respect of employee
benefits are recorded in accordance with Ind AS
19, Employee Benefits.

For defined benefit plans (gratuity), the liability
or asset recognised in the balance sheet is the
present value of the defined benefit obligation at
the end of the reporting period less the fair value
of plan assets. The defined benefit obligation is
calculated by an independent actuary using the
projected unit credit method. The present value
of the defined benefit obligation is determined by
discounting the estimated future cash outflows
by reference to market yields at the end of the
reporting period on government bonds that
have terms approximating to the terms of the
related obligation.

The net interest cost is calculated by applying the
discount rate to the net balance of the defined
benefit obligation and the fair value of plan assets.
This cost is included in employee benefit expense
in the statement of profit and loss.

Re-measurement gains and losses arising from
experience adjustments and changes in actuarial
assumptions are recognised in the period in which
they occur, directly in other comprehensive income.
They are included in retained earnings in the

statement of changes in equity and in the balance
sheet. Re-measurements are not reclassified to
profit or loss in the subsequent periods.

Changes in the present value of the defined benefit
obligation resulting from plan amendments
or curtailments are recognised immediately in
statement of profit or loss as past service cost.

The Company''s contributions to defined
contribution plans (provident fund) are recognized
in statement of profit or loss when the employee
renders related service. The Company has no
further obligations under these plans beyond its
periodic contributions.

The Company provides for liability at period
end on account of un-availed earned leave and
Long Term Incentive Plan (''LTIP'') as per actuarial
valuation using projected unit credit method.

Liabilities for wages and salaries, including non¬
monetary benefits that are expected to be settled
wholly within 12 months after the end of the
period in which the employees render the related
service are recognised in respect of employees''
services up to the end of the reporting period and
are measured at the amounts expected to be paid
when the liabilities are settled. The liabilities are
presented as employee benefit payable under
other financial liabilities in the balance sheet.

I. Share-based payments
Equity-settled transactions

Employees of the Company receive remuneration
in the form of share-based payments, whereby
employees render services as consideration for
equity instruments (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. Further details are given in note 38.

That cost is recognised, together with a
corresponding increase in Employee Stock Option
Plan (ESOP) reserves in equity, over the period in
which the performance and/or service conditions
are fulfilled in employee benefits expense. The
cumulative expense recognised 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 recognised

as at the beginning and end of that period and is
recognised in employee benefits expense.

Performance conditions which are market
conditions are taken into account when
determining the grant date fair value of the awards.
Service and non-market performance 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 recognised for awards that do not
ultimately vest because non-market performance
and/or service conditions have not been met.

When the terms of an equity-settled award are
modified, the minimum expense recognised is the
expense had the terms not been modified, if the
original terms of the award are met. An additional
expense is recognised for any modification that
increases the total fair value of the share-based
payment transaction, or is otherwise beneficial
to the employee as measured at the date of
modification. 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.

m. Foreign currency transactions

The Company''s financial statements are
presented in INR, which is also the Company''s
functional currency.

Transactions in foreign currencies are initially
recorded by the Company at functional currency
spot rates at the date the transaction first qualifies
for recognition. However, for practical reasons,
the Company uses average rate if the average
approximates the actual rate at the date of
the transaction.

Monetary assets and liabilities denominated in
foreign currencies are translated at the functional
currency spot rates of exchange at the reporting
date. Exchange differences arising on settlement
or translation of monetary items are recognised in
statement of profit and loss.

Non-monetary items that are measured in terms of
historical cost in a foreign currency are translated
using the exchange rates at the dates of the initial

transactions. Non-monetary items measured at
fair value in a foreign currency are translated
using the exchange rates at the date when the
fair value is determined. The gain or loss arising
on translation of non-monetary items measured at
fair value is treated in line with the recognition of
the gain or loss on the change in fair value of the
item (i.e., translation differences on items whose
fair value gain or loss is recognised in OCI ("Other
comprehensive income") or profit or loss are also
recognised in OCI ("Other comprehensive income")
or profit or loss, respectively).

n. Financial instruments

A financial instrument is any contract that gives
rise to a financial asset of one entity and a financial
liability or equity instrument of another entity.

Financial assets

Initial recognition and measurement

All financial assets except trade receivable, unless
there is a significant financing component are
recognized initially at fair value plus transaction
costs, that are attributable to the acquisition of the
financial asset, However, trade receivables that do
not contain a significant financing component are
measured at transaction price.

Subsequen t measuremen t

For purpose of subsequent measurement,
financial assets are classified in four categories:

• Debt instruments at amortized cost

• Debt instruments at fair value through other
comprehensive income (FVTOCI)

• Debt instruments, derivatives and equity
instruments at fair value through profit
or loss (FVTPL)

• Equity instruments measured at fair
value through other comprehensive
income (FVTOCI)

Debt instruments at amortised cost

A ''debt instrument'' is measured at the amortised
cost if both the following conditions are met:

a) The asset is held within a business model
whose objective is to hold assets for
collecting contractual cash flows, and

b) Contractual terms of the asset give rise on
specified dates to cash flows that are solely
payments of principal and interest (SPPI) on
the principal amount outstanding.

After initial measurement, such financial assets are
subsequently measured at amortised cost using
the effective interest rate (EIR) method. Amortised
cost is calculated by taking into account any
discount or premium on acquisition and fees or
costs that are an integral part of the EIR. The EIR
amortization is included in finance income in the
profit or loss. The losses arising from impairment
are recognised in the profit or loss. This category
generally applies to trade and other receivables
and is most relevant to the Company.

Debt instrument at FVTOCI

A ''debt instrument'' is classified as at the FVTOCI if
both of the following criteria are met:

a) The objective of the business model is
achieved both by collecting contractual cash
flows and selling the financial assets, and

b) The asset''s contractual cash flows
represent SPPI.

Debt instruments included within the FVTOCI
category are measured initially as well as at each
reporting date at fair value. Fair value movements
are recognized in OCI ("Other comprehensive
income"). However, the Company recognizes
interest income, impairment losses and reversals
and foreign exchange gain or loss in the statement
of profit and loss. On derecognition of the asset,
cumulative gain or loss previously recognised
in OCI ("Other comprehensive income") is
reclassified from the equity to the statement of
profit and loss. Interest earned whilst holding
FVTOCI debt instrument is reported as interest
income using the EIR method.

Debt instrument at FVTPL

FVTPL is a residual category for debt instruments.
Any debt instrument, which does not meet the
criteria for categorization as at amortized cost or
as FVTOCI, is classified as at FVTPL.

In addition, the Company may elect to designate
a debt instrument, which otherwise meets
amortized cost or FVTOCI criteria, as at FVTPL.
However, such election is allowed only if
doing so reduces or eliminates a measurement
or recognition inconsistency (referred to as
''accounting mismatch'').

Debt instruments included within the FVTPL
category are measured at fair value with all changes
recognized in the statement of profit and loss.

Equity investments

All equity investments in scope of Ind AS 109
are measured at fair value. The Company may
make an irrevocable election to present in other
comprehensive income subsequent changes in
the fair value. The Company makes such election
on an instrument-by-instrument basis. The
classification is made on initial recognition and
is irrevocable.

If the Company decides to classify an equity
instrument as at FVTOCI, then all fair value
changes on the instrument, excluding dividends,
are recognized in OCI ("Other comprehensive
income"). There is no recycling of the amounts
from OCI ("Other comprehensive income")
to statement of profit or loss, even on sale of
investment. However, the Company may transfer
the cumulative gain or loss within equity.

Equity instruments included within the FVTPL
category are measured at fair value with all changes
recognized in the statement of profit and loss.

The equity securities which are not held for
trading, and for which the Company has made
an irrevocable election at initial recognition to
recognize changes in fair value through OCI
("Other comprehensive income") rather than profit
or loss as these are strategic investments and the
Company considered this to be more relevant.

The Company/Group has measured its investments
in subsidiaries at cost in its financial statements
in accordance with Ind AS 27, Separate Financial
Statements. Profit/ loss on sale of investments is
recognised on date of sale and is computed with
reference to the original cost of the investment
sold. The investments are reviewed at each
reporting date to determine whether there is
any indication of impairment considering the
provisions of Ind AS 36 ''Impairment of Assets''. If
any such indication exists, policy for impairment of
non-financial assets is followed.

Derecognition

A financial asset (or, where applicable, a part of a
financial asset or part of a group of similar financial
assets) is primarily derecognised (i.e. removed
from the Company''s balance sheet) when:

• The rights to receive cash flows from the
asset have expired, or

• The Company has transferred its rights to
receive cash flows from the asset or has

assumed an obligation to pay the received
cash flows in full without material delay
to a third party under a ''pass-through''
arrangement; and either (a) the Company
has transferred substantially all the risks and
rewards of the asset, or (b) the Company has
neither transferred nor retained substantially
all the risks and rewards of the asset, but has
transferred control of the asset.

When the Company has transferred its rights to
receive cash flows from an asset or has entered into
a pass-through arrangement, it evaluates if and to
what extent it has retained the risks and rewards
of ownership. When it has neither transferred nor
retained substantially all of the risks and rewards
of the asset, nor transferred control of the asset, the
Company continues to recognize the transferred
asset to the extent of the Company''s continuing
involvement. In that case, the Company also
recognizes an associated liability. The transferred
asset and the associated liability are measured on
a basis that reflects the rights and obligations that
the Company has retained.

Impairment of financial assets

In accordance with Ind AS 109, the Company
applies expected credit loss (ECL) model for
measurement and recognition of impairment
loss on financial assets that are debt instruments,
and are measured at amortized cost e.g., loans,
debt securities, deposits, trade receivables
and bank balance.

The Company follows ''simplified approach'' for
recognition of impairment loss allowance on trade
receivables. The application of simplified approach
does not require the Company to track changes
in credit risk. Rather, it recognizes impairment
loss allowance based on lifetime ECLs at each
reporting date, right from its initial recognition.

For recognition of impairment loss on other
financial assets and risk exposure, the Company
determines that whether there has been a
significant increase in the credit risk since initial
recognition. If credit risk has not increased
significantly, 12-month expected credit loss (ECL)
is used to provide for impairment loss. However,
if credit risk has increased significantly, lifetime
ECL is used. If, in a subsequent period, credit
quality of the instrument improves such that there
is no longer a significant increase in credit risk
since initial recognition, then the entity reverts
to recognising impairment loss allowance based
on 12-month ECL.

Lifetime ECL are the expected credit losses
resulting from all possible default events over
the expected life of a financial instrument. The
12-month ECL is a portion of the lifetime ECL
which results from default events that are possible
within 12 months after the reporting date.

ECL is the difference between all contractual cash
flows that are due to the Company in accordance
with the contract and all the cash flows that the
entity expects to receive (i.e., all cash shortfalls),
discounted at the original EIR.

The Company uses a provision matrix to determine
impairment loss allowance on portfolio of its
trade receivables. The provision matrix is based
on its historically observed default rates over
the expected life of the trade receivables and is
adjusted for forward-looking estimates. At every
reporting date, the historical observed default
rates are updated and changes in the forward¬
looking estimates are analyzed.

ECL impairment loss allowance (or reversal)
recognized during the period is recognized as
income/ expense in the statement of profit and
loss. This amount is reflected under the head
other expenses in the statement of profit and loss.
For the financial assets measured as at amortized
cost, ECL is presented as an allowance, i.e., as an
integral part of the measurement of those assets in
the balance sheet. The allowance reduces the net
carrying amount. Until the asset meets write-off
criteria, the Company does not reduce impairment
allowance from the gross carrying amount.

Financial liabilities

Initial recognition and measurement

Financial liabilities are classified, at initial
recognition, as financial liabilities at fair value
through profit or loss, loans and borrowings,
payables, or as derivatives designated as hedging
instruments in an effective hedge, as appropriate.

All financial liabilities are recognized initially at fair
value and, in the case of loans and borrowings and
payables, net of directly attributable transaction
costs. The Company''s financial liabilities
include borrowings, lease liabilities, trade and
other payables.

Subsequen t measuremen t

The measurement of financial liabilities depends
on their classification as described below:

Loans and borrowings

After initial recognition, interest-bearing loans
and borrowings are subsequently measured at
amortized cost using the EIR method. Gains and
losses are recognized in statement of profit or loss
when the liabilities are derecognized as well as
through the EIR amortization process.

Amortized cost is calculated by taking into account
any discount or premium on acquisition and fees
or costs that are an integral part of the EIR. The EIR
amortization is included as finance costs in the
statement of profit and loss.

Derecognition

A financial liability is derecognized when the
obligation under the liability is discharged or
cancelled or expires. When an existing financial
liability is replaced by another from the same
lender on substantially different terms, or the terms
of an existing liability are substantially modified,
such an exchange or modification is treated as
the derecognition of the original liability and the
recognition of a new liability. The difference in the
respective carrying amounts is recognized in the
statement of profit or loss.

Derivative financial Instruments

The Company enters into certain derivative
contracts to hedge risks which are not designated
as hedges. A derivative is a financial instrument
or other contract with all three of the following
characteristics:

- its value changes in response to the change in
a specified interest rate, financial instrument
price, commodity price, foreign exchange
rate, index of prices or rates, credit rating
or credit index, or other variable, provided
in the case of a non-financial variable that
the variable is not specific to a party to the
contract (sometimes called the "underlying");

- it requires no initial net investment or an
initial investment that is smaller than would
be required for other types of contracts that
would be expected to have a similar response
to changes in market factors; and

- it is settled at a future date.

Derivatives are initially recognized at fair value on
the date a derivative contract is entered into and
are subsequently re-measured to their fair value at
the end of each reporting period

Offsetting of financial instruments

Financial assets and financial liabilities are offset
and the net amount is reported in the balance
sheet if there is a currently enforceable legal right
to offset the recognised amounts and there is an
intention to settle on a net basis, to realise the
assets and settle the liabilities simultaneously.

o. Cash and cash equivalents

Cash and cash equivalent in the 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 cash flow statement, cash
and cash equivalents consist of cash and short¬
term deposits, as defined above, net of outstanding
bank overdrafts as they are considered an integral
part of the Company''s cash management.

p. Leases

The Company as a lessee

The Company''s lease asset classes primarily
consist of leases for coaching centres, office
premises and plant and machinery. The Company
assesses whether a contract contains a lease, at
inception of a contract. A contract is, or contains,
a lease if the contract conveys the right to control
the use of an identified asset for a period of time in
exchange for consideration. To assess whether a
contract conveys the right to control the use of an
identified asset, the Company assesses whether:

(i) the contact involves the use of an
identified asset

(ii) the Company has substantially all of the
economic benefits from use of the asset
through the period of the lease and

(iii) the Company has the right to direct the
use of the asset.

At the date of commencement of the lease,
the Company recognizes a right-of-use asset
("ROU") and a corresponding lease liability for
all lease arrangements in which it is a lessee,
except for leases with a term of twelve months
or less (short-term leases) and low value leases.
For these short-term and low value leases, the
Company recognizes the lease payments as an
operating expense on a straight-line basis over the
term of the lease.

Certain lease arrangements includes the options
to extend or terminate the lease before the end
of the lease term. ROU assets and lease liabilities
includes these options when it is reasonably
certain that they will be exercised.

The right-of-use assets are initially recognized at
cost, which comprises the initial amount of the
lease liability adjusted for any lease payments
made at or prior to the commencement date of
the lease plus any initial direct costs less any lease
incentives. They are subsequently measured
at cost less accumulated depreciation and
impairment losses, if any.

Right-of-use assets are depreciated from the
commencement date on a straight-line basis over
the shorter of the lease term and useful life of the
underlying asset. Right of use assets are evaluated
for recoverability whenever events or changes
in circumstances indicate that their carrying
amounts may not be recoverable. For the purpose
of impairment testing, the recoverable amount
(i.e. the higher of the fair value less cost to sell and
the value-in-use) is determined on an individual
asset basis unless the asset does not generate
cash flows that are largely independent of those
from other assets. In such cases, the recoverable
amount is determined for the Cash Generating
Unit (CGU) to which the asset belongs.

The lease liability is initially measured at amortized
cost at the present value of the future lease
payments. The lease payments are discounted
using the interest rate implicit in the lease or, if
not readily determinable, using the incremental
borrowing rates in the country of domicile of
these leases. Lease liabilities are remeasured
with a corresponding adjustment to the related
right of use asset if the Company changes its
assessment if whether it will exercise an extension
or a termination option.

Lease liability and ROU asset have been separately
presented in the balance sheet and lease payments
have been classified as financing cash flows.

The Company applies the short-term lease
recognition exemption to its short-term leases
of machinery and equipment (i.e., those leases
that have a lease term of 12 months or less from
the commencement date and do not contain a
purchase option). It also applies the lease of low-
value assets recognition exemption to leases
of office equipment that are considered to be

low value. Lease payments on short-term leases
and leases of low-value assets are recognised as
expense on a straight-line basis over the lease term.

q. Business Combinations and Goodwill

Business combinations are accounted for using
the acquisition method. The cost of an acquisition
is measured as the aggregate of the consideration
transferred measured at acquisition date fair value
and the amount of any non controlling interests
in the acquiree. For each business combination,
the Company elects whether to measure the non
controlling interests in the acquiree at fair value
or at the proportionate share of the acquiree''s
identifiable net assets. Acquisition-related costs
are expensed in the periods in which the costs are
incurred and the services are received, with the
exception of the costs of issuing debt or equity
securities that are recognised in accordance with
Ind AS 32 and Ind AS 109.

At the acquisition date, the identifiable assets
acquired and the liabilities assumed are recognized
at their acquisition date fair values. For this
purpose, the liabilities assumed include contingent
liabilities representing present obligation and
they are measured at their acquisition fair values
irrespective of the fact that outflow of resources
embodying economic benefits is not probable.
However, the following assets and liabilities
acquired in a business combination are measured
at the basis indicated below:

• Deferred tax assets or liabilities, and the
liabilities or assets related to employee benefit
arrangements are recognised and measured
in accordance with Ind AS 12 Income Tax and
Ind AS 19 Employee Benefits respectively.

• Potential tax effects of temporary differences
and carry forwards of an acquiree that exist
at the acquisition date or arise as a result of
the acquisition are accounted in accordance
with Ind AS 12.

• Liabilities or equity instruments related
to share based payment arrangements of
the acquiree or share - based payments
arrangements of the Company entered into to
replace share-based payment arrangements
of the acquiree are measured in accordance
with Ind AS 102 Share-based Payments at the
acquisition date.

• Assets (or disposal groups) that are classified
as held for sale in accordance with Ind AS
105 Non-current Assets Held for Sale and

Discontinued Operations are measured in
accordance with that Standard.

• Reacquired rights are measured at a value
determined on the basis of the remaining
contractual term of the related contract.
Such valuation does not consider potential
renewal of the reacquired right.

When additional payments contingent on future
events are negotiated and agreed as part of the
business combination agreement, the entity
analyses the nature as well as economic substance
of these payments, particularly, payments made to
those who remain as employees of the business
after it is acquired, to determine whether these
whether they are in the nature of payment for future
employee services or they represent contingent
consideration for business combination. In the
former case, depending on the exact terms of
the arrangement, the payments to be made
are accounted for as remuneration for services
to be received subsequent to the acquisition,
rather than as part of the consideration paid for
the business. Any contingent consideration to
be transferred by the acquirer, i.e., contingent
payment to be treated as such, is recognised
at fair value at the acquisition date. Contingent
consideration classified as an asset or liability that
is a financial instrument and within the scope of
Ind AS 109 Financial Instruments, is measured at
fair value with changes in fair value recognised in
profit or loss in accordance with Ind AS 109. If the
contingent consideration is not within the scope
of Ind AS 109, it is measured in accordance with
the appropriate Ind AS and shall be recognised
in profit or loss. Contingent consideration that
is classified as equity is not re-measured at
subsequent reporting dates and subsequent its
settlement is accounted for within equity.

Goodwill is initially measured at cost, being the
excess of the aggregate of the consideration
transferred and the amount recognized for non¬
controlling interests, and any previous interest
held, over the net identifiable assets acquired and
liabilities assumed.

After initial recognition, goodwill is measured
at cost less any accumulated impairment
losses. For the purpose of impairment testing,
goodwill acquired in a business combination
is, from the acquisition date, allocated to each
of the Company''s cash-generating units that
are expected to benefit from the combination,
irrespective of whether other assets or liabilities of
the acquiree are assigned to those units.

Where settlement of any part of cash consideration
is deferred, the amounts payable in the future
are discounted to their present value as on the
acquisition date. The discount rate used is the
entity''s incremental borrowing rate, being the rate
at which a similar borrowing could be obtained
from an independent financier under comparable
terms and conditions.

If the business combination is achieved in
stages, the acquisition date carrying value of
the acquirer''s previously held equity interest in
the acquiree is remeasured to fair value at the
acquisition date. Any gains or losses arising
from such remeasurement are recognized in
profit or loss or other comprehensive income, as
appropriate. If the initial accounting for a business
combination is incomplete by the end of the
reporting period in which the combination occurs,
the Company reports provisional amounts for the
items for which the accounting is incomplete.
Those provisional amounts are adjusted through
goodwill during the measurement period, or
additional assets or liabilities are recognized, to
reflect new information obtained about facts and
circumstances that existed at the acquisition date
that, if known, would have affected the amounts
recognized at that date. These adjustments are
called as measurement period adjustments. The
measurement period does not exceed one year
from the acquisition date.

When the consideration transferred by the
Company in a business combination includes
a contingent consideration arrangement,
the contingent consideration is measured at
its acquisition-date fair value and included
as part of the consideration transferred in a
business combination. Changes in fair value
of the contingent consideration that qualify as
measurement period adjustments are adjusted
retrospectively, with corresponding adjustments
against Goodwill/capital reserve. Measurement
period adjustments are adjustments that arise
from additional information obtained during the
''measurement period'' (which cannot exceed one
year from the acquisition date) about facts and
circumstances that existed at the acquisition date.

The subsequent accounting for changes in the
fair value of the contingent consideration that do
not qualify as measurement period adjustments
depends on how the contingent consideration
is classified. Contingent consideration that
is classified as equity is not remeasured at
subsequent reporting dates and its subsequent

settlement is accounted for within equity. Other
contingent consideration is remeasured to fair
value at subsequent reporting dates with changes
in fair value recognized in profit or loss.

r. Investment in subsidiaries and associate

A subsidiary is an entity that is controlled by
another entity.

An associate is an entity over which the Company
has significant influence. Significant influence
is the power to participate in the financial and
operating policy decisions of the investee but is
not control or joint control over those policies.

The Company''s investments in its subsidiaries and
associates are accounted at cost less impairment.

Impairment of investments

The Company reviews its carrying value of
investments carried at cost annually, or more
frequently when there is indication for impairment.
If the recoverable amount is less than its carrying
amount, the impairment loss is recorded in the
Statement of Profit and Loss.

When an impairment loss subsequently reverses,
the carrying amount of the Investment is increased
to the revised estimate of its recoverable amount,
so that the increased carrying amount does not
exceed the cost of the Investment. A reversal of
an impairment loss is recognised immediately in
Statement of Profit or Loss.

s. Earnings/ (loss) per share (EPS)

Basic earnings per share is calculated by dividing
the net profit or loss attributable to equity holders
of parent company (after deducting preference
dividends and attributable taxes) by the weighted
average number of equity shares outstanding
during the year.

For the purpose of calculating diluted earnings
per share, the net profit or loss for the period
attributable to equity shareholders of the
Company and the weighted average number of
shares outstanding during the period are adjusted
for the effects of all dilutive potential equity shares.

t. Segment reporting

Operating segments are reported in a manner
consistent with the internal reporting provided to
the chief operating decision-maker. The Company
operates in a single operating segment and
geographical segment.

2.3 Climate - related matters

The Company considers climate-related matters in
estimates and assumptions, where appropriate. This
assessment includes a wide range of possible impacts
on the Company due to both physical and transition
risks. Even though the Company believes its business
model and products will still be viable after the transition
to a low-carbon economy, climate-related matters
increase the uncertainty in estimates and assumptions
underpinning several items in the financial statements.
Even though climate-related risks might not currently
have a significant impact on measurement, the
Company is closely monitoring relevant changes and
developments, such as new climate-related legislation.
The items and considerations that are most directly
impacted by climate-related matters are:

• Useful life of property, plant and equipment. When
reviewing the residual values and expected useful
lives of assets, the Company considers climate-
related matters, such as climate-related legislation
and regulations that may restrict the use of assets
or require significant capital expenditures. See
Note 2.2.g for further information.

• Impairment of non-financial assets. The value-in¬
use may be impacted in several different ways
by transition risk in particular, such as climate-
related legislation and regulations and changes
in demand for the Company''s products. Even
though the Company has concluded that no single
climate-related assumption is a key assumption for
the year ended March 31, 2026 test of goodwill,
the Company considered expectations for the
asset-light, predominantly digital nature of its
operations, regulatory developments relevant to
the education sector and evolving learner demand
for technology-enabled education in the cash¬
flow forecasts in assessing value-in-use amounts.
See Note 45 for further information.

• Fair value measurement. For revalued office
properties, the Company considers the effect of
physical and transition risks and whether investors
would consider those risks in their valuation. The
Company believes it is not currently exposed to
severe physical risks, but believes that investors, to
some extent, would consider impacts of transition
risks in their valuation, such as increasing
requirements for energy efficiency of buildings
due to climate-related legislation and regulations
as well as tenants'' increasing demands for low-
emission buildings. See Note 34.

3 Significant accounting judgements estimates
and assumptions

The preparation of the Company''s 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

Other disclosures relating to the Company''s exposure to
risks and uncertainties includes:

• Financial Risk management objectives and
policies Note 35

• Capital management Note 36
Judgements

In the process of applying the Company''s accounting
policies, management has made the following judgements,
which have the most significant effect on the amounts
recognised in the financial statements:

Determining the lease term of contracts with renewal
and termination options - company as lessee

The Company determines the lease term as the non¬
cancellable term of the lease, together with any periods
covered by an option to extend the lease if it is reasonably
certain to be exercised, or any periods covered by an
option to terminate the lease, if it is reasonably certain not
to be exercised.

The Company has several lease contracts that include
extension and termination options. The Company applies
judgement in evaluating whether it is reasonably certain
whether or not to exercise the option to renew or terminate
the lease. That is, it considers all relevant factors that create
an economic incentive for it to exercise either the renewal
or termination. After the commencement date, the Company
reassesses the lease term if there is a significant event or
change in circumstances that is within its control and affects
its ability to exercise or not to exercise the option to renew
or to terminate.

Estimates and assumptions

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. The Company based its

assumptions and estimates on parameters available when the
financial statements were prepared. Existing circumstances
and assumptions about future developments, however, may
change due to market changes or circumstances arising that
are beyond the control of the Company. Such changes are
reflected in the assumptions when they occur.

Share-based payments

The Companymeasures the cost of equity-settled transactions
with employees using a Black Scholes Options Pricing
model to determine the fair value of the liability incurred.
Estimating fair value for share-based payment transactions
requires determination of the most appropriate valuation
model, which is dependent on the terms and conditions of
the grant. This estimate also requires determination of the
most appropriate inputs to the valuation model including
the expected life of the share option, volatility and dividend
yield and making assumptions about them. The assumptions
and models used for estimating fair value for share-based
payment transactions are disclosed in Note 38

Revenue from operations

The Company recognized revenue over a period of time
under a fixed period contract, i.e. coaching services, in
which services are rendered. The Company is also providing
support services along with the coaching services, which
continues even after the fixed period contract. The Company
has determined that revenue is recognised till fixed period
contract because major cost for providing the services, i.e.
fees for teachers, incurred during the fixed period of contract
and support services are not substantial performance
obligation under the contract.

Defined benefit plans (gratuity benefits)

The cost of the defined benefit gratuity plan and other
post-employment medical benefits and the present value
of the gratuity obligation 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 is highly sensitive to
changes in these assumptions. All assumptions are reviewed
at each reporting date.

The parameter most subject to change is the discount
rate. In determining the appropriate discount rate for plans
operated, the management considers the interest rates
of government bonds in currencies consistent with the
currencies of the defined benefit obligation.

The mortality rate is based on publicly available mortality
tables for the country. Those mortality tables tend to change
only at interval in response to demographic changes.
Future salary increases and gratuity increases are based on

expected future inflation rates for the country. Further details
about gratuity obligations are given in Note 33.

Fair value measurement of financial instruments

When the fair values of financial assets and financial liabilities
recorded in the financial statements cannot be measured
based on quoted prices in active markets, their fair value is
measured using internal valuation techniques. The inputs
to these models are taken from observable markets where
possible, but where this is not feasible, a degree of judgement
is required in establishing fair values. Judgements include
considerations of inputs such as liquidity risk, credit risk and
volatility. Changes in assumptions about these factors could
affect the reported fair value of financial instruments.

Provision for expected credit losses of trade receivables
and contract assets

The Company uses a provision matrix to calculate ECLs
for trade receivables and contract assets. The provision
rates are based on days past due for groupings of various
customer segments that have similar loss patterns (i.e.,
by geography, product type, customer type and rating,
and coverage by letters of credit and other forms of credit
insurance). The provision matrix is initially based on the
Company''s historical observed default rates. The Company
will calibrate the matrix to adjust the historical credit loss
experience with forward-looking information. For instance, if
forecast economic conditions (i.e., gross domestic product)
are expected to deteriorate over the next year which can
lead to an increased number of defaults in the service sector,
the historical default rates are adjusted. At every reporting
date, the historical observed default rates are updated and
changes in the forward-looking estimates are analysed.

The assessment of the correlation between historical
observed default rates, forecast economic conditions and
ECLs is a significant estimate. The amount of ECLs is sensitive
to changes in circumstances and of forecast economic
conditions. The Company''s historical credit loss experience
and forecast of economic conditions may also not be
representative of customer''s actual default in the future.
The information about the ECLs on the Company''s trade
receivables and contract assets is disclosed in Note 6(d) .

Impairment of non-financial assets

Impairment exists when the carrying value of an asset or
cash generating unit exceeds its recoverable amount, which
is the higher of its fair value less costs of disposal and its
value in use. The fair value less costs of disposal calculation
is based on available data from binding sales transactions,
conducted at arm''s length, for similar assets or observable
market prices less incremental costs for disposing of the
asset. The value in use calculation is based on a DCF model.
The cash flows are derived from the budget for the next
five years and do not include restructuring activities that
the Company is not yet committed to or significant future

investments that will enhance the asset''s performance of
the CGU being tested. The recoverable amount is sensitive
to the discount rate used for the DCF model as well as the
expected future cash-inflows and the growth rate used for
extrapolation purposes. These estimates are most relevant
to goodwill and other intangibles with indefinite useful lives
recognised by the Group. The key assumptions used to
determine the recoverable amount for the different CGUs,
including a sensitivity analysis, are disclosed and further
explained in Note 45

Intangible asset under development

The Company capitalises intangible asset under development
for a project in accordance with the accounting policy.
Initial capitalisation of costs is based on management''s
judgement that technological and economic feasibility is
confirmed, usually when a product development project has
reached a defined milestone according to an established
project management model. In determining the amounts to
be capitalised, management makes assumptions regarding
the expected future cash generation of the project, discount
rates to be applied and the expected period of benefits.

Leases - estimating the incremental borrowing rate

The Company cannot readily determine the interest rate
implicit in the lease, therefore, it uses its incremental
borrowing rate (IBR) to measure lease liabilities. The IBR is
the rate of interest that the Company would have to pay to
borrow over a similar term, and with a similar security, the
funds necessary to obtain an asset of a similar value to the
right-of-use asset in a similar economic environment. The
IBR therefore reflects what the Company ''would have to
pay'', which requires estimation when no observable rates
are available or when they need to be adjusted to reflect the
terms and conditions of the lease. The Company estimates
the IBR using observable inputs (such as market interest
rates) when available and is required to make certain entity-
specific estimates.

4 Recent pronouncements and standards issued
but not yet effective

New amendments adopted during the year

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. During the year ended March 31, 2026 and upto the
date of issuance of financial statements, MCA has amended
the following Ind AS:

Ind AS 21 - The Effects of Changes in Foreign Exchange
Rates

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 learners 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

Ind AS 1 - Presentation of Financial Statements

Specify the requirements for classifying liabilities as current
or non-current. The amendments clarify:

• What is meant by a right to defer settlement

• That a right to defer must exist at the end of the
reporting period

• That classification is unaffected by the likelihood that
an entity will exercise its deferral right

• That only if an embedded derivative in a convertible
liability is itself an equity instrument would the terms of
a liability not impact its classification

In addition, a requirement has been introduced to require
disclosure when a liability arising from a loan agreement
is classified as non-current and the entity''s right to defer
settlement is contingent on compliance with future
covenants within twelve months.

If there is a breach of a material covenant of a long term loan
arrangement on or before the end of the reporting period,
resulting in the liability becoming payable on demand
as at the reporting date, and the lender agrees—after the
reporting period but before the financial statements are
approved for issue—not to demand repayment for at least
12 months as a consequence of the breach, this shall be
treated as an adjusting event. Accordingly, the entity is not
required to classify the liability as current.

Ind AS 7 - Statement of Cash Flows and Ind AS 107 -
Financial Instruments: Disclosures

Disclosures to clarify the characteristics of supplier
finance arrangements and require additional disclosure of
such arrangements.

Ind AS 12 - Income Taxes

A mandatory temporary exception to the recognition and
disclosure of deferred taxes arising from the jurisdictional
implementation of the Pillar Two model rules; and disclosure
requirements for affected entities to help learners of the
financial statements better understand an entity''s exposure
to Pillar Two income taxes arising from that legislation,
particularly before its effective date.

The amendments are applicable for annual periods
beginning on or after April 1, 2025. The Company has
determined that it does not have any impact of these
amendments in its financial statements.

Amendments to Ind AS issued but not yet effective

MCA vide notification no. G.S.R. 549(E) dated August
13, 2025 has issued the Companies (Indian Accounting
Standards) Second Amendment Rules, 2025 which amends
following Ind AS (as applicable to the Company):

Ind AS 1 - Presentation of Financial Statements

For annual reporting periods beginning on or after 1 April
2026, any breach of a covenant—whether material or
immaterial-occurring on or before the reporting date will,
in accordance with Ind AS 1, require the related liability to
be classified as current, unless the lender has granted a
waiver of the breach on or before the reporting date and has
agreed not to demand repayment for at least 12 months after
the reporting date as a consequence of the breach. Such a
waiver shall be treated as an adjusting event.

Ind AS 10 - Events after the Reporting Period

Ind AS 10 has been amended to remove the previous
treatment under which a lender''s post reporting date
waiver—granted before the financial statements were
approved for issue—of a breach of a material covenant in
a long term loan arrangement that occurred on or before
the end of the reporting period, resulting in the liability
becoming payable on demand at the reporting date, was
regarded as an adjusting event.

The amendments are applicable for annual periods
beginning on or after April 1, 2026. The Company has
evaluated the amendments and the impact is not expected
to be material.

Capital work in progress as at March 31, 2026 includes assets under construction at various coaching centres and branch
offices which are pending completion. There are no projects which have either exceeded their budget or whose timelines
have been deferred.

The Company has neither revalued nor impaired its property, plant and equipment for the year ended March 31, 2026 and
March 31, 2025 except INR 10.18 crores property, plant and equipment is written off during the year ended March 31, 2025
on the basis of net shortage on completion of physical verification exercise.

During the year ended March 31, 2026, the Company made the following investments:

1) INR 165.60 crores (March 31, 2025: INR 31.04 crores) in Series A and B 0.001% Non-Cumulative Optionally Convertible
Preference Shares ("OCPS") and 10.50% Non-Convertible Debentures ("NCDs") of Lord Krishna Financial Services
Limited ("LKFSL"), an entity operating as a non-deposit taking non-banking financial company registered with the
Reserve Bank of India.

LKFSL provides loans to students of the Company and others, without any recourse to the Company in respect
of any default or non-recoverability. Further, Finz Fintech Private Limited, a subsidiary of the Company, earns
commission from LKFSL for lead generation and collection support services.

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