Notes to Accounts of Cambridge Technology Enterprises Ltd.

Mar 31, 2025

i) Provisions, Contingent Liabilities & Contingent Assets:

The Company recognises provisions when there is present obligation as a result of past event and it is probable that there will be an outflow of resources and reliable estimate can be
made of the amount of the obligation. If the effect of the time value of money is material, provisions are determined by discounting the expected future cash flows to net present value
using an appropriate pre-tax discount rate that reflects current market assessments of the time value of money and, where appropriate, the risks specific to the liability. Unwinding of the
discount is recognised in the Statement of Profit and Loss as a finance cost. Provisions are reviewed at each reporting date and are adjusted to reflect the current best estimate.

A present obligation that arises from past events where it is either not probable that an outflow of resources will be required to settle or a reliable estimate of the amount cannot be
made, is disclosed as a contingent liability. Contingent Liabilities are also disclosed when there is a possible obligation arising from past events, 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.

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

j) Investments in Subsidiary Company:

Investments in subsidiary companies are measured at cost less impairment

k) Financial instruments:

Financial assets and financial liabilities are recognised when the Company becomes a party to the contractual provisions of the instrument.

Financial assets and financial liabilities are initially measured at fair value. Transaction costs that are directly attributable to the acquisition or issue of financial assets and financial
liabilities (other than financial assets and financial liabilities at fair value through profit or loss) are added to ordeducted from the fair value of the financial assets orfinancial liabilities, as
appropriate, on initial recognition. Transaction costs directly attributable to the acquisition offinancial assets or financial liabilities at fair value through profit or loss are recognised
immediately in profit or loss.

Financial assets

(i) Financial assets carried at amortised cost

A financial asset is subsequently measured at amortised cost if it is held within a business model whose objective is to hold the asset in order to collect contractual cash flows and the
contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.

(ii) Financial assets at fair value through other comprehensive income

A financial asset is subsequently measured at fair value through other comprehensive income if it is held within a business model whose objective is achieved by both collecting
contractual cash flows and selling financial assets and the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and
interest on the principal amount outstanding. Further, in case where the company has made an irrevocable selection based on its business model, for its investments which are classified
as equity instruments, the subsequent changes in fair value are recognized in other comprehensive income.

(iii) Financial assets at fair value through profit or loss

A financial asset which is not classified in any of the above categories are subsequently fair valued through profit or loss.

(iv) The Company recognizes loss allowances using the expected credit loss (ECL) model for the financial assets which are not fair valued through profit or loss. Loss allowance for trade
receivables with no significant financing component is measured at an amount equal to lifetime ECL. For all otherfinancial assets, expected credit losses are measured at an amount equal
to the 12-month ECL, unless there has been a significant increase in credit risk from initial recognition in which case those are measured at lifetime ECL. The amount of expected credit
losses (or reversal) that is required to adjust the loss allowance at the reporting date to the amount that is required to be recognised is recognized as an impairment gain or loss in
statement of profit or loss.

Financial liabilities and equity instruments
Classification as debt or equity

Financial liabilities and equity instruments issued by the Company are classified according to the substance of the contractual arrangements entered into and the definitions of a financial
liability and an equity instrument.

Equity Instruments

An equity instrument is any contract that evidences a residual interest in the assets of the Company after deducting all of its liabilities. Equity instruments are recorded at the proceeds
received, net of direct issue costs.

Financial Liabilities

Financial liabilities such as borrowings are initially measured at fair value, net of transaction costs, and are subsequently measured at amortised cost, using the effective interest rate
method where the time value of money is significant.

Interest bearing bank loans, overdrafts and unsecured loans are initially measured at fair value and are subsequently measured at amortised cost usingthe effective interest rate method.
Any difference between the proceeds (net of transaction costs) and the settlement or redemption of borrowings is recognised over the term of the borrowings in the statement of profit
and loss.

Derecognition of financial instruments

The Company derecognizes a financial asset when the contractual rights to the cash flows from the financial asset expire or it transfers the financial asset and the transfer qualifies for
derecognition under Ind AS 109. A financial liability (or a part of a financial liability) is derecognized from the Company''s balance sheet when the obligation specified in the contract is
discharged or cancelled or expires.

Fair value of financial instruments

In determining the fair value of its financial instruments, the Company uses a variety of methods and assumptions that are based on market conditions and risks existing at each reporting
date. The methods used to determine fair value include discounted cash flow analysis, available quoted market prices and dealer quotes. All methods of assessing fair value
result in general approximation of value, and such value may or may not be realized.

Offsetting financial instruments

Financial assets and liabilities are offset and the net amount is reported in the balance sheet where there is a legally enforceable right to offset the recognized amounts and there is an
intention to settle on a net basis or realize the asset and settle the liability simultaneously. The legally enforceable right must not be contingent on future events and must be enforceable
in the normal course of business and in the event of default, insolvency or bankruptcy of the Company or the counterparty.

l) Earnings Per Share :

Basic earnings per share is computed by dividing profit or loss attributable to equity shareholders of the Company by the weighted average number of equity shares outstanding during
the period. The Company did not have any potentially dilutive securities in any of the periods presented.

m) Cash and cash equivalents:

The Company considers all highly liquid investments, which are readily convertible into known amounts of cash that are subject to an insignificant risk of change in value, to be cash
equivalents. Cash and cash equivalents consist of balances with banks which are unrestricted for withdrawal and usage.

n) Segment Reporting - Identification of Segments:

An operating segment is a component of the Company that engages in business activities from which it may earn revenues and incur expenses, whose operating results are regularly
reviewed bythe company''s chief operatingdecision maker to make decisions for which discrete financial information is available. Based on the management approach as defined in Ind AS
108, the chief operating decision maker evaluates the Company''s performance and allocates resources based on an analysis of various performance indicators by business segments and
geographic segments.

o) Leases:

The Company determines whether an arrangement contains a lease by assessing whether the fulfilment of a transaction is dependent on the use of a specific asset and whether the
transaction conveys the right to use that asset to the Company in return for payment. Where this occurs, the arrangement is deemed to include a lease and is accounted for either as
finance or operating lease.

As lessee

Leases of property, plant and equipment where the Company, as lessee, has substantially all the risks and rewards of ownership are classified as finance leases. Finance leases are
capitalized at the lease''s inception at the fair value of the leased property or, if lower, the present value of the minimum lease payments. The corresponding rental obligations, net of
finance charges, are included in borrowings or other financial liabilities as appropriate. Each lease payment is allocated between the liability and finance cost. The finance cost is charged
to the profit or loss over the lease period so as to produce a constant periodic rate of interest on the remaining balance of the liability for each period.

Leases in which a significant portion ofthe risks and rewards of ownership are not transferred to the Companyas lessee are classified as operating leases. Payments made under operating
leases are charged to Statement of profit and loss on a straight line basis over the period ofthe lease unlessthe payments are structured to increase in line with expected general inflation
to compensate for the lessor''s expected inflationary cost increases.

With effective from 1 April 2019:

As a lessee:

The Company assess 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:

(1) The Contract involves the use of an identified asset;

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

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

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 oftwelve 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.

Right-of-use assets are depreciated from the commencement date on a straight-line basis over the balance lease term 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.

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 the leases. Lease liabilities are re-measured 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 shall be separately presented in the Balance Sheet and lease payments shall be classified as financing cash flows.

p) Rounding off amounts:

All amounts disclosed in the financial statements and notes have been rounded off to the nearest thousands as per the requirement of Schedule III, unless otherwise stated.

q) Standards issued but not yet effective:

Recent pronouncements 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. For the year ended March 31, 2025, MCA has not notified any new standards or amendments to the existing standards applicable to the Company.

Cost recognition

Costs and expenses are recognised when incurred and have been classified according to their nature.

Costs and expenses are recognised when incurred and have been classified according to their nature. The costs of the Company are broadly categorised in employee benefit expenses, cost
of equipment and software licences, depreciation and amortisation expense and other expenses. Other expenses mainly include fees to external consultants, subcontractors , facility
expenses, travel expenses, communication expenses, bad debts and advances written off, allowance for expected credit losses and doubtful advances (net) and other expenses. Other
expenses are aggregation of costs which are individually not material such as, recruitment and training, misc. expenses, etc.

i) Terms of repayment and securities of secured loans

Term Loan - I (in Foreign Currency FCNR) from HDFC Bank Limited amounting to Rs. 41,434.51 thousands (Previous year: Rs. 69,532.36 thousands) is disclosed under long-term
borrowings. The FCNR loan of USD 17,08,802 was availed towards reimbursement ofthe acquisition cost ofthe building incurred by the Company. The loan is repayable in 60 equal
monthly installments commencing from September 2022 and is secured by a first and exclusive charge on the corporate office building. It carries an interest rate of 2.50% p.a. plus
SOFR. As of the balance sheet date, the Company has repaid 29 out of the 60 installments.

Subsequent Events: Two monthly installments that were due on 11th February 2025 and 11th March 2025 were paid in the month of May 2025.

Term loan - II in Foreign currency FCNR from HDFC Bank Limited amounting to Rs.9,434.24 (Previous year: Rs. 15,796.22 thousands) disclosed under long-term borrowings. The loan in
FCNR $.3,56,664 was availed against reimbursement of the Interior cost of the Building incurred by the company and the loan will be repayable in 55 equal installments commencing
from February 2023. The loan is secured by Corporate Office Building as first and exclusive charge. The loan carries interest rate of 2.50% SOFR p.a. The company has repaid 24
installments out of 55 installments as on the balance sheet date.

Term loan - III in Foreign currency FCNR from HDFC Bank Limited amounting to Rs.1,21,087.35 (Previous year: Rs. 2,01,278.75 thousands) disclosed under long-term borrowings. The
loan in FCNR $.36,62,106.80 was availed for acquisition of Foreign Subsidiary by the company and the loan will be repayable in 48 equal installments commencing from January 2024.
The loan carries interest rate of 3.00% SOFR p.a. The company has repaid 13 installments out of 44 installments as on the balance sheet date.

i) Cash Credit / Working Capital Demand Loans from Banks

The Cash Credit / Working Capital Demand Loan (WCDL) facilities are secured by way of hypothecation of current assets including receivables and are further secured by a pari-passu
charge on the movable fixed assets of the Company. The facilities are repayable on demand and are generally renewed annually.

As at 31st March 2025, the outstanding balance in Cash Credit account with HDFC Bank amounting to Rs.3,227.11 thousands (Previous year: Rs. Nil thousands)

Working Capital Demand loans from HDFC Bank amounting to Rs.97,534.22 thousands equivalent USD 11,39,684.71 (Previous year: Rs.2,16,838.03 thousands equivalent USD
26,00,911.91 )

ii) Terms of working capital loan from bank, terms of interest and nature of security:

Current maturities of Long term debt in FCNR for Term Loan I amounting to Rs. 34,122.99 thousands equivalent USD 3,98,726.26 (Previous year: Rs. 28,492.56 thousands equivalent
USD 3,41,760.36 ) disclosed under current borrowings.

Current maturities of Long term debt in FCNR for Term Loan II amounting to Rs.7,769.63 thousands equivalent USD 90,787.90 (Previous year: Rs. 6,487.66 thousands equivalent USD
77,817.60 ) disclosed under current borrowings.

Current maturities of Long term debt in FCNR for Term Loan III amounting to Rs. 99,719.17 thousands equivalent USD 11,65,215.80 (Previous year: Rs.83,266.32 thousands equivalent
USD 9,98,756.40 ) disclosed under current borrowings.

The above figures are restated as at 31st March 2025 @ closing rate of I USD in INR 85.58

iii) ''Loan from related party:

Software services

CTEL offers a full suite of digital transformation services, including:

Artificial Intelligence Solutions: Tailored AI services from strategic planning to implementation (AIaaS), including integration with existing client platforms. Big Data Consulting: EDW strategy
design, analytics, dashboards, scorecarding, KPI/metric management using advanced big data and cloud technologies. Cloud Services: Cloud migration, SaaS application development, disaster
recovery planning, monitoring, backup, and cloud TCO assessments. Application Services: End-to-end development, migration, testing, and mobility solutions across modern platforms. DevOps:
Advisory, implementation, and support to accelerate release cycles and improve agility. IAM (Identity and Access Management): Strategy, implementation, and managed services using platforms
like Oracle and ForgeRock etc. Infrastructure Management: Unified management of cloud, middleware, OS, and enterprise IT infrastructure.

Sale of Licenses

The Companyearns revenue fromthe sale of software licenses aspartofitschannelpartnership arrangements with leadingtechnology providers Oracle etc. also selling Atlassian Dashboard Hub
Pro -Charts, Reports, Time in Status, Tables Data Center for Jira Software . Under these arrangements, the Company facilitating the resale of software products and licenses to end customers
across various industry segments.

Trade receivables and contract balances

The company classifies the right to consideration in exchange for deliverables as receivable. A receivable is a right to consideration that is unconditional upon passage of time.

Revenue for fixed price development contracts contracts are recognized as related service are performed. Revenue for fixed price maintenance contracts is recognized on the basis of time
elapsed.

Revenue recognition for fixed price development contracts is based on percentage of completion method. Invoicing to the clients is based on milestones as defined in the contract. This would
result in the timing of revenue recognition being different from the timing of billing the customers.

Revenue recognition for fixed price maintenance contracts is based on utilisation of man power in a particular project duringthe period,which will be according to master serviceagreement or
purchase order or statement of work of respective projects.

In respect of other fixed-price contracts, revenue is recognised using percentage-of-completion method (''POC method'') of accounting with contract costs incurred determining the degree of
completion of the performance obligation

Revenue related to fixed price maintenance and support services contracts where the Company is standing ready to provide services is recognised based on time elapsed mode and revenue is
straight-lined over the period of performance.

Revenue recognition for cost plus contracts is based on cost incurred towards a particular project during the period by adding the profit margin, according to master service agreement or
purchase order or statement of work of respective projects.

Trade receivable are presented net of impairment in the Balance Sheet.

Revenue from subsidiaries is recognised based on transaction price which is at arm''s length.

Contract assets are recognised when there are excess of revenues earned over billings on contracts. Contract assets are classified as unbilled receivables (only act of invoicing is pending) when
there is unconditional right to receive cash, and only passage of time is required, as per contractual terms.

Unearned and deferred revenue ("contract liability") is recognised when there are billings in excess of revenues. The billing schedules agreed with customers include periodic performance based
payments and / or milestone based progress payments. Invoices are payable within contractually agreed credit period.

Income from Software Products/ Licenses

Revenue fromthe sale of user licenses for software applications is recognized upon the transfer of title in the user license, except in the case of multiple-element contracts requiring significant
implementation services, where revenue is recognized as per the percentage of completion method.

Performance obligations and remaining performance obligations

The remaining performance obligation disclosure provides the aggregate amount ofthe transaction price yet to be recognized as at theend ofthe reportingperiod andan explanation astowhen
the Company expects to recognize these amounts in revenue. Applying the practical expedient as given in Ind AS 115, the Company has not disclosed the remaining performance obligation
related disclosures forcontracts where the revenue recognized correspondsdirectlywith thevaluetothecustomerofthe entity''s performance completed to date, typicallythose contractswhere
invoicing is on fixed price maintenance contract basis and in cases where the performance obligation is part of a contract that has an original expected duration of one year or less. Remaining
performance obligation estimates are subject to change and are affected by several factors, including terminations, changes in the scope of contracts, periodic revalidations, adjustment for
revenue that has not materialized and adjustments for currency.

34. Employee 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 salaries, wages etc. and the
expected cost of ex-gratia are recognised in the period in which the employee renders the related service. A liability is recognised for the amount expected to be paid when there
is a present legal or constructive obligation to pay this amount as a result of past service provided by the employee and the obligation can be estimated reliably.

(i) Compensated absences

The leave obligation covers the Company''s liability for earned leave which is unfunded. The company recognizes liabilities for compensated absences, such as earned leave, using
the Projected Unit Credit Method. Actuarial valuations are conducted at each balance sheet date to ensure the liabilities accurately reflect the company''s obligations for accrued
leave.

(ii) Defined contribution plans

The Company has a defined contribution plan, namely the Provident Fund. Contributions are made to the Provident Fund at the rate of 12% of basic salary as per regulations.
These contributions are made to a registered Provident Fund administered by the Government. The Company''s obligation is limited to the amount contributed, and it has no
further contractual or constructive obligations. The contributions made to the fund are recognised as an expense in profit and loss under employee benefit expenses.

The above sensitivity analysis is based on a change in each assumption while holding all other assumptions constant. In practice, this is unlikely to occur and changes in some of
the assumptions may be correlated. When calculating the sensitivity of the defined benefit obligation to significant actuarial assumptions, the same method (present value of the
defined benefit obligation calculated with the projected unit credit method at the end of the reporting period) has been applied as when calculating the defined benefit liability
recognised in the balance sheet.
iv) Risk exposure

Through its defined benefit plans, the Company is exposed to a number of risks, the most significant of which are detailed below:

Interest rate risk:

The defined benefit obligation calculated uses a discount rate based on government bonds. If bond yields fall, the defined benefit obligation will tend to increase.

Salary inflation risk:

Higher than expected increases in salary will increase the defined benefit obligation.

Demographic risk:

This is the risk of variability of results due to unsystematic nature of decrements that include mortality, withdrawal, disability and retirement. The effect of these decrements on
the defined benefit obligation is not straight forward and depends upon the combination of salary increase, discount rate and vesting criteria. It is important not to overstate
withdrawals because in the financial analysis the retirement benefit of a short career employee typically costs less per year as compared to a long service employee.

Note on “Code on Security, 2020"

The Indian Parliament has approved the Code on Social Security, 2020 which would impact the contributions by the company towards Provident Fund and Gratuity. The Ministry
of Labour and Employment has released draft rules for the Code on Social Security, 2020 on November 13, 2020, and has invited suggestions from stakeholders which are under
active consideration by the Ministry. The Company will assess the impact and its evaluation once the subject rules are notified and will give appropriate impact in its financial
statements in the period in which, the Code becomes effective and the related rules to determine the financial impact are published

35. Financial instruments and risk management
Fair values

a) The fair value of financial assets and liabilities is included at the amount at which the instrument could be exchanged in a current transaction between willing parties, other
than in a forced or liquidation sale.

b) The fair value of trade receivables, trade payables, and other current financial assets and liabilities is considered to be equal to their carrying amounts due to their short-term
nature. All such items have been classified under Level 2 of the fair value hierarchy. In cases where items are non-current in nature, their fair value has also been determined
using observable inputs, such as the discounted cash flow method, and accordingly classified as Level 2. Similarly, for unquoted equity instruments where recent information is
insufficient or where a wide range of fair value estimates exists, cost has been considered the best estimate of fair value and classified under Level 2.

c) The fair value of forward foreign exchange contracts is calculated as the present value determined using forward exchange rates, currency basis spreads between the
respective currencies and interest rate curves.

Set out below, is a comparision by class of the carrying amounts and fair value of the Company''s financial instruments, other than those with carrying amounts that are
reasonable approximation of fair values:

* Fa ir value of instruments is classified in various fair value hierarchies based on the following three levels:

Level 1: Level 1 hierarchy includes financial instruments measured using quoted prices.

Level 2 - Inputs are other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from
prices).

Level 3 - Inputs are not based on observable market data (unobservable inputs). Fair values are determined in whole or in part using a valuation model based on assumptions
that are neither supported by prices from observable current market transactions in the same instrument nor are they based on available market data. The cost of unquoted
investments included in Level 3 of fair value hierarchy approximate their fair value because there is a wide range of possible fair value measurements and the cost represents
estimate of fair value within that range.

Management exercises its best judgment in estimating the fair value of financial instruments. However, all estimation techniques have inherent limitations. Accordingly, the fair
value estimates presented are not necessarily indicative of the amounts that the Company could realize or pay in actual markettransactions as of the respective reporting dates.
The fair value of financial instruments may also vary subsequent to the reporting date due to changes in market conditions or other factors.

36. Financial risk management

The Company is exposed to market risk (fluctuation in foreign currency exchange rates, price and interest rate), liquidity risk and credit risk, which may adversely impact the fair
value of its financial instruments. The Company assesses the unpredictability of the financial environment and seeks to mitigate potential adverse effects on the financial
performance of the Company.

(A) Market risk

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. Such changes in the values of financial
instruments may result from changes in the foreign currency exchange rates, interest rates, credit, liquidity and other market changes.The Company''s exposure to market risk is
primarily on account of foreign currency exchange rate risk.

The analysis exclude the impact of movements in market variables on the carrying values of financial assets and liabilities .

The sensitivity of the relevant profit or loss item is the effect of the assumed changes in respective market risks. This is based on the financial assets and financial liabilities held
at 31 March, 2025 and 31 March, 2024.

(i) Foreign currency exchange rate risk

The fluctuation in foreign currency exchange rates may have potential impact on the statement of profit and loss and other comprehensive income and equity, where any
transaction references more than one currency or where assets / liabilities are denominated in a currency other than the functional currency of the Company. Considering the
countries and economic environment in which the Company operates, its operations are subject to risks arising from fluctuations in exchange rates in those countries. The
Company''s exposure to the risk of changes in foreign exchange rates relates primarily to the trade/other payables, trade/other receivables. The risks primarily relate to
fluctuations in US Dollars against the functional currencies of the Company. The Company''s exposure to foreign currency changes for all other currencies is not material. The
Company evaluates the impact of foreign exchange rate fluctuations by assessing its exposure to exchange rate risks.

The foreign exchange rate sensitivity is calculated by aggregation of the net foreign exchange rate exposure and a simultaneous parallel foreign exchange rates shift of the
currencies by 1% against the functional currency of the Company .

The following analysis has been worked out based on the net exposures of the Company as of the date of balance sheet which could affect the statement of profit and loss and
other comprehensive income and equity .

The assumed increase/decrease in interest rate for sensitivity analysis is based on the currently observable market environment
(B) Credit Risk

Financial assets of the Company include trade receivables, loans to wholly owned subsidiaries, employee advances, security deposits held with government authorities and
others and bank deposits which represents Company''s maximum exposure to the credit risk.

With respect to credit exposure from customers, the Company has a procedure in place aiming to minimise collection losses. Credit Control team assesses the credit quality of
the customers, their financial position, past experience in payments and other relevant factors.

The carrying amount of trade receivables, loans, advances, deposits, cash and bank balances, bankdeposits and interest receivable on deposits represents company''s maximum
exposure to the credit risk. No other financial asset carry a significant exposure with respect to the credit risk. Bank deposits and cash balances are placed with reputable banks
and deposits are with reputable government, public bodies and others. The Company''s exposure to credit risk is influenced mainly by the individual characteristics of each
customer. However, management also considers the factors that may influence the credit risk of its customer base, including default risk associate with the industry and country
in which customers operate. Credit quality of a customer is assessed based on an extensive credit rating scorecard and individual credit limits are defined in accordance with this
assessment. With respect to other financial assets viz., loans & advances, deposits with government and banks, the credit risk is insignificant since the loans & advances are
given to its wholly owned subsidiary and employees only and deposits are held with government bodies and reputable banks. The credit quality of the financial assets is
satisfactory, taking into account the allowance for credit losses.

Credit risk on trade receivables and other financial assets is evaluated as follows:

38. Contingent liabilities

The Company has the following contingent liabilities as at:

Contingencies
Direct tax matters

The Company has ongoing disputes with income tax authorities in India .The disputes relate to taxtreatment of certain expenses claimed as deduction, computation or and allowances and characterisation of
expenses and transfer pricing issues. Contingent liability in respect of tax demands received from direct tax authorities in India and other jurisdictions is 8.07 crore and 8.07 crore as at 31 March 2025 and 31
March 2024, respectively. These demand orders are being contested by the Company based on the management evaluation and advise of tax consultants.The Company periodically receives notices and
inquiries from income tax authorities related to the Company''s operations in the jurisdictions it operates in. The Company has evaluated these notices and inquiries and has concluded that any consequent
income tax claims or demands by the income tax authorities will not succeed on ultimate resolution.

Indirect taxes

The Company has ongoing disputes with tax authorities primarily relating to the characterisation and classification of certain items. The company has demands amounting to Rs. 3.26 crore as at March 31,
2025 and Rs. 3.26 crore as at March 31, 2024 have been raised by various indirect tax authorities. These are being contested by the Company based on management''s evaluation and the advice of tax
consultants.

During the year, the Company received a GST demand of Rs. 0.14 crore relating to a mismatch of Input Tax Credit (ITC) claimed between GSTR-3B and GSTR-2A for the financial year 2017-18. An appeal has
been filed before the Appellate Authority against the said demand.

47. Corporate Social Responsibility (CSR)

Section 135 of the Companies Act 2013 and the Rules made thereunder prescribe that every company having a net worth of Rs 500 crore or
more, or turnover of Rs 1,000 crore or more or a net profit of Rs 5 crore or more during any financial year shall ensure that the Company
spends in every financial year, at least 2% of the average net profits made during the three immediately preceding financial years, in
pursuance of its Corporate Social Responsibility (CSR) policy. As the conditions are not satisfied, the provisions pertaining to CSR as prescribed
under the Companies Act 2013 are not applicable to the Company for the year ended 31 March 2025.

48. Additional Regulatory Information

The Company does not have any Benami property and does not have any proceeding initiated or pending against the company for holding
any benami property under the Benami Transactions (Prohibition) Act, 1988 (45 of 1988) and rules made thereunder.

There are no immovable properties whose title deeds are not held in the name of the Company.

The Company has certain charges/satisfaction filings pending in respect of facilities from CITI Bank and Kotak Bank, which are yet to be
registered with the Registrar of Companies. These filings are pending beyond the statutory period.

The company had obtained borrowings from banks on the basis of security of Current assets which includes book debts.

The company does not have any transactions with companies struck off under section 248 of the Companies Act 2013 or section 560 of
Companies Act, 1956.

The Company has not traded or invested in crypto currency or virtual currency during the financial year.

The Company has not advanced or loaned or invested funds to any other person or entity, 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.

The Company has not received any fund from any person or entity, 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.

The Company does not have any such transaction which is not recorded in the books of accounts but 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).

49. Figures of the previous period have been regrouped/reclassified / rearranged wherever necessary.

As per our report of even date

For B R A N D & Associates LLP For and on behalf of the Board

Chartered Accountants

Firm Registration Number: 012344S/S200101

Kumaraswami Reddy A D.R.R Swaroop Lalpet Sridhar

Partner Wholetime Director Director

Membership Number: 220366 DIN: 00453250 DIN: 02539952

UDIN: 25220366BMICWE6360

Place: Hyderabad Purnayya Puppala Ashish Bhattad

Date: 29 May 2025 Chief Financial Officer Company Secretary

M.No. A34781

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Mar 31, 2024

Last year (FY 22-23), the company established a wholly-owned Indian subsidiary, M/s CT Web App Private Limited, with an initial investment of ^ 1,00,000 in equity shares, issuing 10,000 shares at a face value of ?10 per share and a paid-up value of ?10 per share.

During the year, the company acquired the remaining 2,000 equity shares at a face value of Rs. 10 each in FA Software Services Private Limited, thereby making it a wholly-owned subsidiary.

During the year, the company acquired the Indian subsidiary RP Web Apps Private Limited by investing in 60,880 equity shares at a face value of Rs. 10 each.

During the year, the company acquired a foreign software company, App Shark Software Inc., by fully investing in 1,000,000 equity shares, making it a 100% wholly-owned subsidiary.

d) Rights, preferences and restrictions attached to the equity shares:

The Company has single class of equity shares having par value of Rs. 10 per share. Accordingly, all equity shares rank equally with regard to dividends and share in the Company''s residual assets. The equity shares are entitled to receive dividend as declared from time to time. In the event of liquidation of the Company, the holders of equity shares will be entitled to receive the residual assets of the company, remaining after distribution of all preferential amounts in proportion to the number of equity shares held.

Nature and purpose of reserves

(i) Capital reserve

This reserve was created at the time of buy back of shares. The reserve will be utilised in accordance with the provisions of the Companies Act, 2013.

(ii) Share options outstanding reserve

This reserve relates to stock options granted by the Company to employees under the CTEL ESOP Schemes. The balance will be transferred to securities premium or retained earnings on exercise or cancellation of vested options.

(iii) Retained earnings

This reserve represents undistributed accumulated earnings of the Company as on the balance sheet date. This reserve will be utilized in accordance with the provisions of the Companies Act, 2013

i) Terms of repayment and securities of secured loans

Term loan - I in Foreign currency FCNR from HDFC Bank Limited amounting to Rs.69532.36 (Previous year: Rs. 96006.77 thousands) disclosed under long-term borrowings. The loan in FCNR $.1708802 was availed against reimbursement of the acquisition cost of the Building incurred by the company and the loan will be repayable in 60 equal installments commencing from September 2022. The loan is secured by Corporate Office Buidling as first and exclusive charge. The loan carries interest rate of 2.50% SOPHR p.a. The company has repaid 19 installments out of 60 installments as on the balance sheet date.

Term loan - II in Foreign currency FCNR from HDFC Bank Limited amounting to Rs.15796.22 (Previous year: Rs. 21860.39 thousands) disclosed under long-term borrowings. The loan in FCNR $.356664 was availed against reimbursement of the Interior cost of the Building incurred by the company and the loan will be repayable in 55 equal installments commencing from February 2023. The loan is secured by Corporate Office Buidling as first and exclusive charge. The loan carries interest rate of 2.50% SOPHR p.a. The company has repaid 13 installments out of 55 installments as on the balance sheet date.

Term loan - III in Foreign currency FCNR from HDFC Bank Limited amounting to Rs.201,278.76 (Previous year: Rs. Nil thousands) disclosed under long-term borrowings. The loan in FCNR $.3662106.80 was availed for acquisition of Foreign Subsidiary by the company and the loan will be repayable in 48 equal installments commencing from January 2024. The loan carries interest rate of 2.50% SOPHR p.a. The company has repaid 3 installments out of 48 installments as on the balance sheet date.

i)''Terms of working capital loan from bank, terms of interest and nature of security:

Packing Credit loan /working Capital Demand loans from HDFC Bank amounting to Rs.216838.03 thousands equivalent USD 26,00,911.91 (Previous year:

Rs.147400.66 thousands equivalent USD 15,09,441.79 )

Current meturities of Long term debt in FCNR for Term Loan I amounting to Rs. 28492.56 thousands equivalent USD 341760.36 (Previous year: Rs. 28099.54 thousands equivalent USD 341760.36 ) disclosed under current borrowings.

Current meturities of Long term debt in FCNR for Term Loan II amounting to Rs. 6487.65 thousands equivalent USD 77817.60 (Previous year: Rs. 6398.16 thousands equivalent USD 77817.60 ) disclosed under current borrowings.

Current meturities of Long term debt in FCNR for Term Loan III amounting to Rs. 83266.32 thousands equivalent USD 998756.40 (Previous year: Nil) disclosed under current borrowings.

Software services

Cambridge Technology (CT) is a global technology company focused on AI as a Service (AlaaS) to transform organizations into Al-first leaders. AI is not a one-size-fits-all solution. It needs incorporation of numerous aspects of technologies, platforms, and services tailored to meet the specific business needs.CT offers solutions ranging from strategic workshops to AIaaS implementation and elements that are required to put all of these things together. CT''s offerings fit together because of its understanding towards the entire lifecycle of a business.

CT''s offerings include, AI, Big Data and Cloud services, Application and Devop services, IAM and Infrastructure management services. The company is confident of staying innovative amid the fastest pace of transformation with its strong focus on delivery and AI. It aims to consolidate innovation, skills and delivery for best customer value.

Trade receivables and contract balances

The company classifies the right to consideration in exchange for deliverables as receivable.

A receivable is a right to consideration that is unconditional upon passage of time. Revenue for fixed price development contracts contracts are recognized as related service are performed. Revenue for fixed price maintenance contracts is recognized on the basis of time elapsed.

Revenue recognition for fixed price development contracts is based on percentage of completion method. Invoicing to the clients is based on milestones as defined in the contract. This would result in the timing of revenue recognition being different from the timing of billing the customers.

Revenue recognition for fixed price maintenance contracts is based on utilisation of man power in a particular project during the period, which will be according to master service agreement or purchase order or statement of work of respective projects.

In respect of other fixed-price contracts, revenue is recognised using percentage-of-completion method (‘POC method'') of accounting with contract costs incurred determining the degree of completion of the performance obligation

Revenue related to fixed price maintenance and support services contracts where the Company is standing ready to provide services is recognised based on time elapsed mode and revenue is straight-lined over the period of performance.

Revenue recognition for cost plus contracts is based on cost incurred towards a particular project during the period by adding the profit margin, according to master service agreement or purchase order or statement of work of respective projects.

Trade receivable are presented net of impairment in the Balance Sheet.

Revenue from subsidiaries is recognised based on transaction price which is at arm''s length.

Contract assets are recognised when there are excess of revenues earned over billings on contracts. Contract assets are classified as unbilled receivables (only act of invoicing is pending) when there is unconditional right to receive cash, and only passage of time is required, as per contractual terms.

Unearned and deferred revenue (“contract liability”) is recognised when there are billings in excess of revenues. The billing schedules agreed with customers include periodic performance based payments and / or milestone based progress payments. Invoices are payable within contractually agreed credit period.

Income from Software Products/ Licenses

Revenue from the sale of user licenses for software applications is recognized upon the transfer of title in the user license, except in the case of multiple-element contracts requiring significant implementation services, where revenue is recognized as per the percentage of completion method.

Performance obligations and remaining performance obligations

The remaining performance obligation disclosure provides the aggregate amount of the transaction price yet to be recognized as at the end of the reporting period and an explanation as to when the Company expects to recognize these amounts in revenue. Applying the practical expedient as given in Ind AS 115, the Company has not disclosed the remaining performance obligation related disclosures for contracts where the revenue recognized corresponds directly with the value to the customer of the entity''s performance completed to date, typically those contracts where invoicing is on fixed price maintenance contract basis and in cases where the performance obligation is part of a contract that has an original expected duration of one year or less. Remaining performance obligation estimates are subject to change and are affected by several factors, including terminations, changes in the scope of contracts, periodic revalidations, adjustment for revenue that has not materialized and adjustments for currency.

Information about revenue

Revenue from external customers - Sale of Services - Rs. 39979.48 thousands

The Company has made external sales to the following customers meeting the criteria of 10% or more of the entity revenue.

Customer 1 - ? Nil thousands

Revenue from external customers - Sale of Products - Rs. 43527.08 thousands

The Company has made external sales to the following customers meeting the criteria of 10% or more of the entity revenue.

Customer 1 - ? Nil thousands

32. Employee 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 salaries, wages etc. and the expected cost of ex-gratia are recognised in the period in which the employee renders the related service. A liability is recognised for the amount expected to be paid when there is a present legal or constructive obligation to pay this amount as a result of past service provided by the employee and the obligation can be estimated reliably.

(i) Compensated absences

The leave obligation covers the Company''s liability for earned leave which is unfunded.The company recognizes liabilities for compensated absences, such as earned leave, using the Projected Unit Credit Method. Actuarial valuations are conducted at each balance sheet date to ensure the liabilities accurately reflect the company’s obligations for accrued leave.

(ii) Defined contribution plans

The Company has a defined contribution plan, namely the Provident Fund. Contributions are made to the Provident Fund at the rate of 12% of basic salary as per regulations. These contributions are made to a registered Provident Fund administered by the Government. The Company''s obligation is limited to the amount contributed, and it has no further contractual or constructive obligations. The contributions made to the fund are recognised as an expense in profit and loss under employee benefit expenses.

(ii) Post- employment obligations

a) Gratuity

The Company provides for gratuity for employees as per the Payment of Gratuity Act, 1972. The cost of providing benefits is determined using the Projected Unit Credit Method, with actuarial valuations being carried out at each balance sheet date. Remeasurement, comprising actuarial gains and losses,), is reflected immediately in the balance sheet with a charge or credit recognised in other comprehensive income in the period in which they occur.

The above sensitivity analysis is based on a change in each assumption while holding all other assumptions constant. In practice, this is unlikely to occur and changes in some of the assumptions may be correlated. When calculating the sensitivity of the defined benefit obligation to significant actuarial assumptions, the same method (present value of the defined benefit obligation calculated with the projected unit credit method at the end of the reporting period) has been applied as when calculating the defined benefit liability recognised in the balance sheet.

b) Compensated absenses

The company recognizes liabilities for compensated absences, such as earned leave, using the Projected Unit Credit Method. Actuarial valuations are conducted at each balance sheet date to ensure the liabilities accurately reflect the company’s obligations for accrued leave.

v) Risk exposure

Through its defined benefit plans, the Company is exposed to a number of risks, the most significant of which are detailed below:

Interest rate risk:

The defined benefit obligation calculated uses a discount rate based on government bonds. If bond yields fall, the defined benefit obligation will tend to increase.

Salary inflation risk:

Higher than expected increases in salary will increase the defined benefit obligation.

Demographic risk:

This is the risk of variability of results due to unsystematic nature of decrements that include mortality, withdrawal, disability and retirement. The effect of these decrements on the defined benefit obligation is not straightforward and depends upon the combination of salary increase, discount rate and vesting criteria. It is important not to overstate withdrawals because in the financial analysis the retirement benefit of a short career employee typically costs less per year as compared to a long service employee.

Note on “Code on Security, 2020”

The Indian Parliament has approved the Code on Social Security, 2020 which would impact the contributions by the company towards Provident Fund and Gratuity. The Ministry of Labour and Employment has released draft rules for the Code on Social Security, 2020 on November 13, 2020, and has invited suggestions from stakeholders which are under active consideration by the Ministry. The Company will assess the impact and its evaluation once the subject rules are notified and will give appropriate impact in its financial statements in the period in which, the Code becomes effective and the related rules to determine the financial impact are published

33. Financial instruments and risk management Fair values

a) The fair value of financial assets and liabilities is included at the amount at which the instrument could be exchanged in a current transaction between willing parties, other than in a forced or liquidation sale.

b) The fair value of trade receivables, trade payables and other current financial assets and liabilities is considered to be equal to the carrying amounts of these items due to their short term nature. Where such items are non-current in nature, the same has been classified as Level 3 and fair value determined using discounted cash flow basis. Similarly, unquoted equity instruments where most recent information to measure fair value is insufficient, or if there is a wide range of possible fair value measurements, cost has been considered as the best estimate of fair value.

c) The fair value of forward foreign exchange contracts is calculated as the present value determined using forward exchange rates, currency basis spreads between the respective currencies and interest rate curves.

Set out below, is a comparision by class of the carrying amounts and fair value of the Company''s financial instruments, other than those with carrying amounts that are reasonable approximation of fair values:

34. Financial risk management

The Company is exposed to market risk (fluctuation in foreign currency exchange rates, price and interest rate), liquidity risk and credit risk, which may adversely impact the fair value of its financial instruments. The Company assesses the unpredictability of the financial environment and seeks to mitigate potential adverse effects on the financial performance of the Company.

(A) Market risk

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. Such changes in the values of financial instruments may result from changes in the foreign currency exchange rates, interest rates, credit, liquidity and other market changes. The Company’s exposure to market risk is primarily on account of foreign currency exchange rate risk.

The analysis exclude the impact of movements in market variables on the carrying values of financial assets and liabilties .

The sensitivity of the relevant profit or loss item is the effect of the assumed changes in respective market risks. This is based on the financial assets and financial liabilities held at 31 March, 2024 and 31 March, 2023.

(i) Foreign currency exchange rate risk

The fluctuation in foreign currency exchange rates may have potential impact on the statement of profit and loss and other comprehensive income and equity, where any transaction references more than one currency or where assets / liabilities are denominated in a currency other than the functional currency of the Company. Considering the countries and economic environment in which the Company operates, its operations are subject to risks arising from fluctuations in exchange rates in those countries.

The Company’s exposure to the risk of changes in foreign exchange rates relates primarily to the trade/other payables, trade/other receivables. The risks primarily relate to fluctuations in US Dollars against the functional currencies of the Company. The Company’s exposure to foreign currency changes for all other currencies is not material. The Company evaluates the impact of foreign exchange rate fluctuations by assessing its exposure to exchange rate risks.

The foreign exchange rate sensitivity is calculated by aggregation of the net foreign exchange rate exposure and a simultaneous parallel foreign exchange rates shift of the currencies by 1% against the functional currency of the Company .

The following analysis has been worked out based on the net exposures of the Company as of the date of balance sheet which could affect the statement of profit and loss and other comprehensive income and equity .

(iii) Interest rate risk

Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of change in market interest rates. The Company''s exposure to the risk of changes in market interest rates relates primarily to the Company''s debt obligations with floating interest rates. As the Company has certain debt obligations with floating interest rates, exposure to the risk of changes in market interest rates are dependent of changes in market interest rates. Management monitors the movement in interest rate and, wherever possible, reacts to material movements in such rates by restructuring its financing arrangement.

As the Company has no significant interest bearing assets, the income and operating cash flows are substantially independent of changes in market interest rates.

The assumed increase/decrease in interest rate for sensitivity analysis is based on the currently observable market environment

(B) Credit Risk

Financial assets of the Company include trade receivables, loans to wholly owned subsidiaries, employee advances, security deposits held with government authorities and others and bank deposits which represents Company''s maximum exposure to the credit risk.

With respect to credit exposure from customers, the Company has a procedure in place aiming to minimise collection losses. Credit Control team assesses the credit quality of the customers, their financial position, past experience in payments and other relevant factors.

The carrying amount of trade receivables, loans, advances, deposits, cash and bank balances, bank deposits and interest receivable on deposits represents company''s maximum exposure to the credit risk. No other financial asset carry a significant exposure with respect to the credit risk. Bank deposits and cash balances are placed with reputable banks and deposits are with reputable government, public bodies and others. The Company''s exposure to credit risk is influenced mainly by the individual characteristics of each customer. However, management also considers the factors that may influence the credit risk of its customer base, including default risk associate with the industry and country in which customers operate. Credit quality of a customer is assessed based on an extensive credit rating scorecard and individual credit limits are defined in accordance with this assessment. With respect to other financial assets viz., loans & advances, deposits with government and banks, the credit risk is insignificant since the loans & advances are given to its wholly owned subsidiary and employees only and deposits are held with government bodies and reputable banks. The credit quality of the financial assets is satisfactory, taking into account the allowance for credit losses.

Credit risk on trade receivables and other financial assets is evaluated as follows:

(iii) Significant estimates and judgements Impairment of financial assets:

The impairment provisions for financial assets disclosed above are based on assumptions about risk of default and expected loss rates. The company uses judgement in making these assumptions and selecting the inputs to the impairment calculation, based on the company''s past history, existing market conditions as well as forward looking estimates at the end of each reporting period.

(C) Liquidity risk

Prudent liquidity risk management implies maintaining sufficient cash and the availability of funding to meet obligations when due and to close out market positions. Company’s treasury maintains flexibility in funding by maintaining availability under deposits in banks.

Management monitors cash and cash equivalents on the basis of expected cash flows.

(iii) Management expects finance cost to be incurred for the year ending 31 March 2024 is Rs 12500.00 thousands.

35. Capital management

Capital management and Gearing Ratio

For the purpose of the Company''s capital management, capital includes issued equity capital, share premium and all other equity reserves attributable to the equity holders. The primary objective of the company''s capital management is to maximise the shareholder value.

The Company manages its capital structure and makes adjustments in light of changes in economic conditions and the requirements of the financial covenants. The Company monitors capital using a gearing ratio, which is debt divided by total capital. The Company includes within debt, interest bearing loans and borrowings.

In order to achieve this overall objective, the Company''s capital management, amongst other things, aims to ensure that it meets financial covenants attached to the interest-bearing loans and borrowings that define capital structure requirements. Breaches in meeting the financial covenants would permit the bank to immediately call loans and borrowings.

No changes were made in the objectives, policies or processes for managing capital during the years ended 31 March, 2024 and 31 March, 2023.

36. Contingent liabilities

The Company has the following contingent liabilities as at:

Contingencies Direct tax matters

The Company has ongoing disputes with income tax authorities in India .The disputes relate to tax treatment of certain expenses claimed as deduction, computation or and allowances and characterisation of expenses and transfer pricing issues. Contingent liability in respect of tax demands received from direct tax authorities in India and other jurisdictions is 8.07 crore and 8.07 crore as at March 31, 2024 and 2023, respectively. These demand orders are being contested by the Company based on the management evaluation and advise of tax consultants.The Company periodically receives notices and inquiries from income tax authorities related to the Company’s operations in the jurisdictions it operates in. The Company has evaluated these notices and inquiries and has concluded that any consequent income tax claims or demands by the income tax authorities will not succeed on ultimate resolution.

Indirect taxes

The Company has ongoing disputes with tax authorities mainly relating to treatment of characterisation and classificationof certain items. The Company has demands amounting to 3.26 crore and 3.26 crore as at March 31, 2024 and 2023, respectively, from various indirect tax authorities which are being contested by the Company based on the management evaluation and advice of tax consultants.

Guarantees

The Company has given letter of comfort to banks for credit facilities availed by its subsidiary M/s FA Software Services Private Limited for an amount of Rs. 7,00,00,000

39. During the financial year 2012-13, the Company has written-off the trade receivables amounting to Rs. 21,48,81,750/- , due from erstwhile wholly owned step down subsidiary M/s Smartshift Technologies Inc, USA (earlier known as Cambridge Technology Enterprises Inc. USA) and the company has also sold shares of its erstwhile subsidiary M/s SmartShift Group Limited, Mauritius (formerly CambridgeTechnology Enterprises - Mauritius Limited) amounting to Rs. 27,42,60,626/- at nil consideration. The Company has made an application to RBI through an authorized dealer for the approval and ratification of the same which is pending.With reference to the above matters, the Company has submitted resubmission of replies to the queries raised by RBI.

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

Rental expense recorded for short-term leases was ? 4540.47 thousands for the year ended March 31,2024.

Rental income on assets given on operating lease to holding company was ? Nil for the year ended March 31,2024.

42. Segment information

The Company primarily operates in the software development. The Chief Operating Division Maker (CODM) reviews the performance of the software development sector at the consolidated level and makes decisions on sales volumes and profitability.

Section 135 of the Companies Act 2013 and the Rules made thereunder prescribe that every company having a net worth of Rs 500 crore or more, or turnover of Rs 1,000 crore or more or a net profit of Rs 5 crore or more during any financial year shall ensure that the Company spends in every financial year, at least 2% of the average net profits made during the three immediately preceding financial years, in pursuance of its Corporate Social Responsibility (CSR) policy. The provisions pertaining to CSR as prescribed under the Companies Act 2013 are not applicable to the Company for the current period

46. Additional Regulatory Information

The Company does not have any Benami property and does not have any proceeding initiated or pending against the company for holding any benami property under the Benami Transactions (Prohibition) Act, 1988 (45 of 1988) and rules made thereunder.

There are no immovable properties whose title deeds are not held in the name of the Company.

The Company does not have any charges or satisfaction which is yet to be registered with Registrar of Companies beyond the statutory period.

The company had obtained borrowings from banks on the basis of security of Current assets which includes book debts.

The company does not have any transactions with companies struck off under section 248 of the Companies Act 2013 or section 560 of Companies Act, 1956.

The Company has not traded or invested in crypto currency or virtual currency during the financial year.

The Company has not advanced or loaned or invested funds to any other person or entity, 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.

The Company has not received any fund from any person or entity, 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.

The Company does not have any such transaction which is not recorded in the books of accounts but 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).

47. Figures of the previous period have been regrouped/reclassified / rearranged wherever necessary.

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Mar 31, 2023

During the previous year, the company initiated repatriation (partial disinvestment) of its direct investment in Cambridge Technology Investments Pte. Ltd., ("CTIPL"), Singapore, wholly owned subsidiary by way of reduction of its share capital upto 1983700 ordinary shares and as the same is receivable from CTIPL as on the date of previous Balance sheet and the same is shown as "Dues recoverable from subsidiary" company under current financial assets and the same is fully received during the year.

During the year, the company has fully written off the Investment made with AntHill Startups Advisory Pvt Ltd, India for Rs.1500000

During the year, the company has incorported a wholly owned Indian subsidiary M/s CT Web App Private Limited with an initial investment made on equity shares of 10000 each @ Rs.10

During the year, the company has acquired an 8000 shares of face value 10 each Indian subsidiary FA Software Services Private Limited with an initial investment of Rs. 6 lakhs.

Fixed Deposits with banks include Deposits against Bank Guarantees - Rs.1563.08 thousands (2022 - Rs. 3978.80 thousands), Deposits against borrowings - Rs. 262613.54 thousands (2022 - Rs. 213400 thousands), Free hold bank fixed deposits below meturity of 12 months Rs. Nil thousands (2022- Rs. 8000 thousands)

Fixed Deposits with others includes free hold deposits - Rs.120000.00 thousands (2022 - Rs. Nil thousands).

The Company has not advanced or loaned or invested funds to any other person or entity other than those disclosed in the financial statements, 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.

Note: During the previous year, the company initiated repatriation (partial disinvestment) of its direct investment in Cambridge Technology Investments Pte. Ltd., ("CTIPL"), Singapore, wholly owned subsidiary by way of reduction of its share capital upto 1983700 ordinary shares and as the same is receivable from CTIPL as on the date of previous Balance sheet and the same is shown as "Dues recoverable from subsidiary" company under current financial assets and the same is fully received during the year.

d) Rights, preferences and restrictions attached to the equity shares:

The Company has single class of equity shares having par value of Rs. 10 per share. Accordingly, all equity shares rank equally with regard to dividends and share in the Company''s residual assets. The equity shares are entitled to receive dividend as declared from time to time. In the event of liquidation of the Company, the holders of equity shares will be entitled to receive the residual assets of the company, remaining after distribution of all preferential amounts in proportion to the number of equity shares held.

Nature and purpose of reserves

(i) Capital reserve

This reserve was created at the time of buy back of shares. The reserve is utilised in accordance with the provisions of the Companies Act, 2013 and also includes share warrants forfeited amount

(ii) Share options outstanding reserve

This reserve relates to stock options granted by the Company to employees under the CTEL ESOP Schemes. The balance will be transferred to securities premium or retained earnings on exercise or cancellation of vested options.

(iii) Retained earnings

This reserve represents the cumulative profits of the Company and effects of remeasurement of defined benefit obligations. This reserve will be utilized in accordance with the provisions of the Companies Act, 2013.

i) Terms of repayment and securities of secured loans

Term loan - I in Foreign currency FCNR from HDFC Bank Limited amounting to Rs.96006.77 thousands (Previous year: Rs. Nil thousands) disclosed under long-term borrowings. The loan in FCNR $.1708802 was availed against reimbursement of the acquisition cost of the Building incurred by the company and the loan will be repayable in 60 equal installments commencing from September 2022. The loan is secured by Corporate Office Buidling as first and exclusive charge. The loan carries interest rate of 2.50% SOPHR p.a. The company has repaid 7 installments out of 60 installments as on the balance sheet date.

Term loan - II in Foreign currency FCNR from HDFC Bank Limited amounting to Rs.21860.39 thousands (Previous year: Rs. Nil thousands) disclosed under long-term borrowings. The loan in FCNR $.356664 was availed against reimbursement of the Interior cost of the Building incurred by the company and the loan will be repayable in 55 equal installments commencing from February 2023. The loan is secured by Corporate Office Buidling as first and exclusive charge. The loan carries interest rate of 2.50% SOPHR p.a. The company has repaid 1 installment out of 55 installments as on the balance sheet date.

Packing Credit loan /working Capital Demand loans from HDFC Bank amounting to Rs.147400.66 thousands equivalent USD 15,09,441.79 (Previous year: Rs. 141899.72 thousands)

Current meturities of Long term debt in FCNR for Term Loan I amounting to Rs. 28099.54 thousands equivalent USD 341760.36 (Previous year: Nil ) disclosed under current borrowings.

Current meturities of Long term debt in FCNR for Term Loan II amounting to Rs. 6398.16 thousands equivalent USD 77817.60 (Previous year: Nil ) disclosed under current borrowings.

The above figures are restated as at 31st March 2023 @ clsoing rate of I USD in INR 82.22

Software services

Cambridge Technology (CT) is a global technology company focused on AI as a Service (AlaaS) to transform organizations into Al-first leaders. AI is not a one-size-fits-all solution. It needs incorporation of numerous aspects of technologies, platforms, and services tailored to meet the specific business needs.CT offers solutions ranging from strategic workshops to AIaaS implementation and elements that are required to put all of these things together. CT''s offerings fit together because of its understanding towards the entire lifecycle of a business.

CT''s offerings include, AI, Big Data and Cloud services, Application and Devop services, IAM and Infrastructure management services. The company is confident of staying innovative amid the fastest pace of transformation with its strong focus on delivery and AI. It aims to consolidate innovation, skills and delivery for best customer value.

Trade receivables and contract balances

The company classifies the right to consideration in exchange for deliverables as receivable.

A receivable is a right to consideration that is unconditional upon passage of time. Revenue for fixed price development contracts contracts are recognized as related service are performed. Revenue for fixed price maintenance contracts is recognized on the basis of time elapsed.

Revenue recognition for fixed price development contracts is based on percentage of completion method. Invoicing to the clients is based on milestones as defined in the contract. This would result in the timing of revenue recognition being different from the timing of billing the customers.

Revenue recognition for fixed price maintenance contracts is based on utilisation of man power in a particular project during the period, which will be according to master service agreement or purchase order or statement of work of respective projects.

Revenue recognition for cost plus contracts is based on cost incurred towards a particular project during the period by adding the profit margin, according to master service agreement or purchase order or statement of work of respective projects.

Trade receivable are presented net of impairment in the Balance Sheet.

Performance obligations and remaining performance obligations

The remaining performance obligation disclosure provides the aggregate amount of the transaction price yet to be recognized as at the end of the reporting period and an explanation as to when the Company expects to recognize these amounts in revenue. Applying the practical expedient as given in Ind AS 115, the Company has not disclosed the remaining performance obligation related disclosures for contracts where the revenue recognized corresponds directly with the value to the customer of the entity''s performance completed to date, typically those contracts where invoicing is on fixed price maintenance contract basis and in cases where the performance obligation is part of a contract that has an original expected duration of one year or less. Remaining performance obligation estimates are subject to change and are affected by several factors, including terminations, changes in the scope of contracts, periodic revalidations, adjustment for revenue that has not materialized and adjustments for currency.

32. Employee benefits

(i) Leave obligations

The leave obligation covers the Company''s liability for earned leave which is unfunded.

(ii) Defined contribution plans

The Company has defined contribution plans namely Provident fund. Contributions are made to provident fund at the rate of 12% of basic salary as per regulations. The contributions are made to registered provident fund administered by the Government. The obligation of the Company is limited to the amount contributed and it has no further contractual nor any constructive obligation. The expense recognised during the year towards defined contributions plan is Nil as the same is closed as the company for consistancy continuing to maintain the nonfund provisions based on the report from external acturial valuaer of the company.

(ii) Post- employment obligations

a) Gratuity

The Company provides for gratuity for employees as per the Payment of Gratuity Act, 1972. The amount of gratuity payable on retirement/termination is the employees last drawn basic salary per month computed proportionately for 15 days salary multiplied for the number of years of service. The Company was closed the post retirement gratuity plan with HDFC Life Insurance operated earlier. The present value of obligation is determined based on actuarial valuation using the Projected Unit Credit Method, which recognises each period of service giving rise to additional unit of employee benefit entitlement and measures each unit separately to build up the final obligation.

The above sensitivity analysis is based on a change in each assumption while holding all other assumptions constant. In practice, this is unlikely to occur and changes in some of the assumptions may be correlated. When calculating the sensitivity of the defined benefit obligation to significant actuarial assumptions, the same method (present value of the defined benefit obligation calculated with the projected unit credit method at the end of the reporting period) has been applied as when calculating the defined benefit liability recognised in the balance sheet.

v) Risk exposure

Through its defined benefit plans, the Company is exposed to a number of risks, the most significant of which are detailed below:

Interest rate risk:

The defined benefit obligation calculated uses a discount rate based on government bonds. If bond yields fall, the defined benefit obligation will tend to increase.

Salary inflation risk:

Higher than expected increases in salary will increase the defined benefit obligation.

Demographic risk:

This is the risk of variability of results due to unsystematic nature of decrements that include mortality, withdrawal, disability and retirement. The effect of these decrements on the defined benefit obligation is not straight forward and depends upon the combination of salary increase, discount rate and vesting criteria. It is important not to overstate withdrawals because in the financial analysis the retirement benefit of a short career employee typically costs less per year as compared to a long service employee.

Note on "Code on Security, 2020"

The Indian Parliament has approved the Code on Social Security, 2020 which would impact the contributions by the company towards Provident Fund and Gratuity. The Ministry of Labour and Employment has released draft rules for the Code on Social Security, 2020 on November 13, 2020, and has invited suggestions from stakeholders which are under active consideration by the Ministry. The Company will assess the impact and its evaluation once the subject rules are notified and will give appropriate impact in its financial statements in the period in which, the Code becomes effective and the related rules to determine the financial impact are published

33. Financial instruments and risk management Fair values

a) The fair value of financial assets and liabilities is included at the amount at which the instrument could be exchanged in a current transaction between willing parties, other than in a forced or liquidation sale.

b) The fair value of trade receivables, trade payables and other current financial assets and liabilities is considered to be equal to the carrying amounts of these items due to their short term nature. Where such items are non-current in nature, the same has been classified as Level 3 and fair value determined using discounted cash flow basis. Similarly, unquoted equity instruments where most recent information to measure fair value is insufficient, or if there is a wide range of possible fair value measurements, cost has been considered as the best estimate of fair value.

c) The fair value of forward foreign exchange contracts is calculated as the present value determined using forward exchange rates, currency basis spreads between the respective currencies and interest rate curves.

Set out below, is a comparision by class of the carrying amounts and fair value of the Company''s financial instruments, other than those with carrying amounts that are reasonable approximation of fair values: *Fair value of instruments is classified in various fair value hierarchies based on the following three levels:

Level 1: Level 1 hierarchy includes financial instruments measured using quoted prices.

Level 2: The fair value of financial instruments that are not traded in an active market is determined using valuation techniques, which maximise the use of observable market data and rely as little as possible on entity specific estimates. If significant inputs required to fair value an instruments are observable, the instrument is included in Level 2.

Level 3: If one or more of the significant inputs are not based on observable market data, the instruments is included in level 3.

There has been no change in the valuation methodology for Level 3 inputs during the year. The Company has not classified any material financial instruments under Level 3 of the fair value hierarchy. There were no transfers between Level 1 and Level 2 during the year.

Management uses its best judgement in estimating the fair value of its financial instruments. However, there are inherent limitations in any estimation technique. Therefore, for substantially all financial instruments, the fair value estimates presented above are not necessarily indicative of the amounts that the Company could have realized or paid in sale transactions as of respective dates. As such, the fair value of financial instruments subsequent to the reporting dates may be different from the amounts reported at each reporting date.

Cambridge Technology Enterprises Limited

Notes to the financial statements for the year ended 31 March 2023

(All amounts are in f ''thousands'' except per share data and where otherwise stated)

34. Financial risk management

The Company is exposed to market risk (fluctuation in foreign currency exchange rates, price and interest rate), liquidity risk and credit risk, which may adversely impact the fair value of its financial instruments. The Company assesses the unpredictability of the financial environment and seeks to mitigate potential adverse effects on the financial performance of the Company.

(A) Market risk

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 risk comprises of currency risk, interest rate risk and price risk. Financial instruments affected by market risk include loans and borrowings, trade receivables and trade payables involving foreign currency exposure. The sensitivity analyses in the following sections relate to the position as at March 31, 2023 and March 31, 2022.

The analysis exclude the impact of movements in market variables on the carrying values of financial assets and liabilties .

The sensitivity of the relevant profit or loss item is the effect of the assumed changes in respective market risks. This is based on the financial assets and financial liabilities held at 31 March, 2023 and 31 March, 2022.

(i) Foreign currency exchange rate risk

Foreign currency risk is the risk that the fair value or future cash flows of an exposure will fluctuate because of changes in foreign exchange rates. The Company''s exposure to the risk of changes in foreign exchange rates relates primarily to the trade/other payables, trade/other receivables and derivative assets/liabilities. The risks primarily relate to fluctuations in US Dollars against the functional currencies of the Company. The Company''s exposure to foreign currency changes for all other currencies is not material. The Company evaluates the impact of foreign exchange rate fluctuations by assessing its exposure to exchange rate risks.

(iii) Interest rate risk

Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of change in market interest rates. The Company''s exposure to the risk of changes in market interest rates relates primarily to the Company''s debt obligations with floating interest rates. As the Company has certain debt obligations with floating interest rates, exposure to the risk of changes in market interest rates are dependent of changes in market interest rates. Management monitors the movement in interest rate and, wherever possible, reacts to material movements in such rates by restructuring its financing arrangement.

As the Company has no significant interest bearing assets, the income and operating cash flows are substantially independent of changes in market interest rates.

The assumed increase/decrease in interest rate for sensitivity analysis is based on the currently observable market environment

(B) Credit Risk

Financial assets of the Company include trade receivables, loans to wholly owned subsidiaries, employee advances, security deposits held with government authorities and others and bank deposits which represents Company''s maximum exposure to the credit risk.

With respect to credit exposure from customers, the Company has a procedure in place aiming to minimise collection losses. Credit Control team assesses the credit quality of the customers, their financial position, past experience in payments and other relevant factors.

The carrying amount of trade receivables, loans, advances, deposits, cash and bank balances, bank deposits and interest receivable on deposits represents company''s maximum exposure to the credit risk. No other financial asset carry a significant exposure with respect to the credit risk. Bank deposits and cash balances are placed with reputable banks and deposits are with reputable government, public bodies and others. The Company''s exposure to credit risk is influenced mainly by the individual characteristics of each customer. However, management also considers the factors that may influence the credit risk of its customer base, including default risk associate with the industry and country in which customers operate. Credit quality of a customer is assessed based on an extensive credit rating scorecard and individual credit limits are defined in accordance with this assessment. With respect to other financial assets viz., loans & advances, deposits with government and banks, the credit risk is insignificant since the loans & advances are given to its wholly owned subsidiary and employees only and deposits are held with government bodies and reputable banks. The credit quality of the financial assets is satisfactory, taking into account the allowance for credit losses.

Credit risk on trade receivables and other financial assets is evaluated as follows:

(iii) Significant estimates and judgements Impairment of financial assets:

The impairment provisions for financial assets disclosed above are based on assumptions about risk of default and expected loss rates. The company uses judgement in making these assumptions and selecting the inputs to the impairment calculation, based on the company''s past history, existing market conditions as well as forward looking estimates at the end of each reporting period.

(C) Liquidity risk

Prudent liquidity risk management implies maintaining sufficient cash and the availability of funding to meet obligations when due and to close out market positions. Company''s treasury maintains flexibility in funding by maintaining availability under deposits in banks.

Management monitors cash and cash equivalents on the basis of expected cash flows.

(iii) Management expects finance cost to be incurred for the year ending 31 March 2024 is Rs 12500.00 thousands.

35. Capital management

Capital management and Gearing Ratio

For the purpose of the Company''s capital management, capital includes issued equity capital, share premium and all other equity reserves attributable to the equity holders. The primary objective of the company''s capital management is to maximise the shareholder value.

The Company manages its capital structure and makes adjustments in light of changes in economic conditions and the requirements of the financial covenants. The Company monitors capital using a gearing ratio, which is debt divided by total capital. The Company includes within debt, interest bearing loans and borrowings.

In order to achieve this overall objective, the Company''s capital management, amongst other things, aims to ensure that it meets financial covenants attached to the interest-bearing loans and borrowings that define capital structure requirements. Breaches in meeting the financial covenants would permit the bank to immediately call loans and borrowings.

No changes were made in the objectives, policies or processes for managing capital during the years ended 31 March, 2023 and 31 March, 2022.

39. During the financial year 2012-13, the Company has written-off the trade receivables amounting to Rs. 21,48,81,750/- , due from erstwhile wholly owned step down subsidiary M/s Smartshift Technologies Inc, USA (earlier known as Cambridge Technology Enterprises Inc. USA) and the company has also sold shares of its erstwhile subsidiary M/s SmartShift Group Limited, Mauritius (formerly CambridgeTechnology Enterprises - Mauritius Limited) amounting to Rs. 27,42,60,626/- at nil consideration. The Company has made an application to RBI through an authorized dealer for the approval and ratification of the same which is pending.With reference to the above matters, the Company has submitted resubmission of replies to the queries raised by RBI on 08 Jan 2020.

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

Rental expense recorded for short-term leases was ? 4540.47 thousands for the year ended March 31,2023.

Rental income on assets given on operating lease to holding company was ? Nil for the year ended March 31,2023.

42. Segment information

The Company primarily operates in the software development. The Chief Operating Division Maker (CODM) reviews the performance of the software development sector at the consolidated level and makes decisions on sales volumes and profitability.

43. Information about revenue

Revenue from external customers - Sale of Services - Rs. 63756.62 thousands

The Company has made external sales to the following customers meeting the criteria of 10% or more of the entity revenue.

Customers : 2 - ? 38252.89 thousands

Revenue from external customers - Sale of Products - Rs.56637.33 thousands

The Company has made external sales to the following customers meeting the criteria of 10% or more of the entity revenue.

Customers : 2 - ? 36719.71 thousands

Section 135 of the Companies Act 2013 and the Rules made thereunder prescribe that every company having a net worth of Rs 500 crore or more, or turnover of Rs 1,000 crore or more or a net profit of Rs 5 crore or more during any financial year shall ensure that the Company spends in every financial year, at least 2% of the average net profits made during the three immediately preceding financial years, in pursuance of its Corporate Social Responsibility (CSR) policy. The provisions pertaining to CSR as prescribed under the Companies Act 2013 are not applicable to the Company for the current period

47. Additional Regulatory Information

(a) The Company does not have any Benami property and does not have any proceeding initiated or pending against the company for holding any benami property under the Benami Transactions (Prohibition) Act, 1988 (45 of 1988) and rules made thereunder.

(b) There are immovable properties whose title deeds are held in the name of the Company.

(c) The Company does not have any charges or satisfaction which is yet to be registered with Registrar of Companies beyond the statutory period.

(d) The company does not have any borrowings from banks or financial institutions on the basis of security of Current assets.

(e) The company does not have any transactions with companies struck off under section 248 of the Companies Act 2013 or section 560 of Companies Act, 1956.

(f) The Company has not traded or invested in crypto currency or virtual currency during the financial year.

(g) The Company has not received any fund from any person or entity, 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.

(h) The Company does not have any such transaction which is not recorded in the books of accounts but 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).

48. Figures of the previous period have been regrouped/reclassified / rearranged wherever necessary.

---

Mar 31, 2018

1 Company overview

Cambridge Technology Enterprises Limited (CTE), “the Company” is a public limited company incorporated in India having its resgistered office at Hyderabad, Telangana, India. The Company is an information technology services provider dedicated to serving the midsize market enterprises and the midsize units of Global 2000 enterprises across the spectrum of business industries. The Company was incorporated on January 28, 1999 in Hyderabad, Telangana, India.

2 Use of estimates and critical accounting judgements:

In preparation of the financial statements, the Company makes judgements, estimates and assumptions about the carrying values of assets and liabilities that are not readily apparent from other sources. The estimates and the associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.

The estimates and the underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised and future periods affected.

Significant judgements and estimates relating to the carrying values of assets and liabilities include useful lives of property, plant and equipment and intangible assets, impairment of property, plant and equipment, intangible assets and investments, provision for employee benefits and other provisions, recoverability of deferred tax assets, commitments and contingencies.

3.1.1. Fixed Deposits include Deposits against Bank Guarantees - Rs. 11131.70 thousands (2017 - Rs. 10083.60 thousands; 2016 - Rs. 12523.82 thousands), Deposits against borrowings - Rs. 17915.92 thousands (2017 - Nil; 2016 - Nil), Deposits with Customs Dept. - Rs. 184.43 thousands (2017 - Rs. 168.74 thousands; 2016 - Rs. 147.64 thousands) and Deposits against forward contracts - Rs. 3186.59 thousands (2017 - Nil; 2016 - Rs. Nil)

4.1. Fixed Deposits include Deposits against Bank Guarantees - Rs. 3648.50 thousands (2017 - Rs. 2800 thousands; 2016 - Rs. Nil), Deposits against borrowings - Rs. Nil (2017 - Rs. 9000 thousands; 2016 - Nil) and Deposits against forward contracts - Rs. Nil (2017 - Rs. 3000 thousands; 2016 - Rs. 1100 thousands)

(A) Terms/Rights attached to equity sharesThe Company has only one class of equity shares having a face value of 10 /-each. Each holder of equity share is entitled to one vote per share. The company declares and pays dividends in Indian Rupees. The dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting. In the event of liquidation of the company, the equity shareholders will be entitled to receive remaining assets of the company, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders.

Note: During the year 2016-17, the Hon’ble High Court of Judicature at Hyderabad has approved the Scheme of Reduction of Capital.

Accordingly, accumulated losses and unamortised goodwill as on 31st March, 2016 is adjusted against balance of Securities premium Account.

Nature and purpose of other reserves

(i) Capital reserve

This reserve was created at the time of buy back of shares. The reserve is utilised in accordance with the provisions of the Act.

(ii) Securities premium reserve

Securities Premium Reserve is used to record the premium on issue of shares. The reserve is utilised in accordance with the provisions of the Act.

(iii) Share options outstanding reserve

This Reserve relates to stock options granted by the Company to employees under the CTEL ESOP Schemes. This Reserve is transferred to securities premium or retained earnings on exercise or cancellation of vested options.

(iv) Retained earnings

This Reserve represents the cumulative profits of the Company and effects of remeasurement of defined benefit obligations. This Reserve can be utilized in accordance with the provisions of the Companies Act, 2013.

Term loans from banks represents Foreign currency term loan from Kotak Mahindra Bank Limited. Foreign currency term loan is secured by way of first and exclusive charge on all existing and future current and movable fixed assets of the Company, second charge on constant OD/PCFC/BG - KMBL TD(s) of Rs. 250 Lac, personal guarantee of Mr Dharani Raghuram Swaroop and corporate guarantee of M/s CTE Employees Foundation. The loan carries a rate of interest of 6% p.a. as at the balance sheet date.The loan is repayable is 15 equated monthly instalments of 9204 USD.

Unsecured term loan from banks represents loan from Kotak Mahindra Bank and carries rate of interest of 16%. The loan is repayable is 14 equated monthly instalments of Rs. 1.57 thousands.

Loans from others represents two loans from Bajaj Finance. Loan I carries a rate of interest 18.75% p.a and is repayable in 3 equated monthly instalments of Rs. 1.94 thousands. Loan II carries a rate of interest 17.5% p.a and is repayable in 24 equated monthly instalments of Rs. 1.15 thousands.

5.1 Working capital loan from bank represents Over Draft from Kotak Mahindra Bank Limited, secured by way of first and exclusive charge on all existing and future current and movable fixed assets of the Company, second charge on constant OD/PCFC/BG -KMBL TD(s) of Rs. 250 Lac, personal guarantee of Mr Dharani Raghuram Swaroop and corporate guarantee of M/s CTE Employees Foundation. The loan carries a rate of interest of MCLR 6M 1.8% p.a.

The provisions of Section 135 of the Companies Act, 2013 relating to Corporate Social Responsilibility were not applicable for the year ended 31st March, 2017.

6. Exceptional Items: Exceptional Items represent goodwill amortised during the year 2015-16 and reversed during the year 1617 account of Scheme of Capital Reduction. (Refer Note 16 (ii))

7. Reconciliation of tax expenses and the accounting profit multiplied by tax rate

8. Employee benefits

(i) Leave obligations

The leave obligation covers the Company’s liability for earned leave which is unfunded.

(ii) Defined contribution plans

The Company has defined contribution plans namely Provident fund. Contributions are made to provident fund at the rate of 12% of basic salary as per regulations. The contributions are made to registered provident fund administered by the Government. The obligation of the Company is limited to the amount contributed and it has no further contractual nor any constructive obligation. The expense recognised during the year towards defined contributions plan is as follows:

(ii) Post- employment obligations

a) Gratuity

The Company provides for gratuity for employees as per the Payment of Gratuity Act, 1972. The amount of gratuity payable on retirement/termination is the employees last drawn basic salary per month computed proportionately for 15 days salary multiplied for the number of years of service. The Company operates post retirement gratuity plan with HDFC Life Insurance. The present value of obligation is determined based on actuarial valuation using the Projected Unit Credit Method, which recognises each period of service giving rise to additional unit of employee benefit entitlement and measures each unit separately to build up the final obligation.

The following table sets out the amounts recognised in the financial statements in respect of gratuity plan

Fair value of plan assets — 100% with HDFC Life New Group Unit Linked Plan

Expected contributions to post- employment benefit plans of gratuity for the year ending 31 March 2019 are Rs. 118.64 Lakhs.

iv) Significant estimates and sensitivity Analysis

The sensitivity of the defined benefit obligation to changes in key assumptions is:

The above sensitivity analysis is based on a change in each assumption while holding all other assumptions constant. In practice, this is unlikely to occur and changes in some of the assumptions may be correlated. When calculating the sensitivity of the defined benefit obligation to significant actuarial assumptions, the same method (present value of the defined benefit obligation calculated with the projected unit credit method at the end of the reporting period) has been applied as when calculating the defined benefit liability recognised in the balance sheet.

v) Risk exposure

Through its defined benefit plans, the Company is exposed to a number of risks, the most significant of which are detailed below:

Interest rate risk:

The defined benefit obligation calculated uses a discount rate based on government bonds. If bond yields fall, the defined benefit obligation will tend to increase.

Salary inflation risk:

Higher than expected increases in salary will increase the defined benefit obligation.

Demographic risk:

This is the risk of variability of results due to unsystematic nature of decrements that include mortality, withdrawal, disability and retirement. The effect of these decrements on the defined benefit obligation is not straight forward and depends upon the combination of salary increase, discount rate and vesting criteria. It is important not to overstate withdrawals because in the financial analysis the retirement benefit of a short career employee typically costs less per year as compared to a long service employee.

9. Financial instruments and risk management Fair values

a) The fair value of financial assets and liabilities is included at the amount at which the instrument could be exchanged in a current transaction between willing parties, other than in a forced or liquidation sale.

b) The fair value of trade receivables, trade payables and other current financial assets and liabilities is considered to be equal to the carrying amounts of these items due to their short term nature. Where such items are non-current in nature, the same has been classified as Level 3 and fair value determined using discounted cash flow basis. Similarly, unquoted equity instruments where most recent information to measure fair value is insufficient, or if there is a wide range of possible fair value measurements, cost has been considered as the best estimate of fair value.

c) The fair value of forward foreign exchange contracts is calculated as the present value determined using forward exchange rates, currency basis spreads between the respective currencies and interest rate curves.

Set out below, is a comparision by class of the carrying amounts and fair value of the Company’s financial instruments, other than those with carrying amounts that are reasonable approximation of fair values:

*Fair value of instruments is classified in various fair value hierarchies based on the following three levels:

Level 1: Level 1 hierarchy includes financial instruments measured using quoted prices.

Level 2: The fair value of financial instruments that are not traded in an active market is determined using valuation techniques, which maximise the use of observable market data and rely as little as possible on entity specific estimates. If significant inputs required to fair value an instruments are observable, the instrument is included in Level 2.

Level 3: If one or more of the significant inputs are not based on observable market data, the instruments is included in level 3.

There has been no change in the valuation methodology for Level 3 inputs during the year. The Company has not classified any material financial instruments under Level 3 of the fair value hierarchy. There were no transfers between Level 1 and Level 2 during the year.

Management uses its best judgement in estimating the fair value of its financial instruments. However, there are inherent limitations in any estimation technique. Therefore, for substantially all financial instruments, the fair value estimates presented above are not necessarily indicative of the amounts that the Company could have realized or paid in sale transactions as of respective dates. As such, the fair value of financial instruments subsequent to the reporting dates may be different from the amounts reported at each reporting date.

10. Financial risk management

The Company is exposed to market risk (fluctuation in foreign currency exchange rates, price and interest rate), liquidity risk and credit risk, which may adversely impact the fair value of its financial instruments. The Company assesses the unpredictability of the financial environment and seeks to mitigate potential adverse effects on the financial performance of the Company.

(A) Market risk

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 risk comprises of currency risk, interest rate risk and price risk. Financial instruments affected by market risk include loans and borrowings, trade receivables and trade payables involving foreign currency exposure. The sensitivity analyses in the following sections relate to the position as at March 31, 2018 and March 31, 2017.The analysis exclude the impact of movements in market variables on the carrying values of financial assets and liabilties .The sensitivity of the relevant profit or loss item is the effect of the assumed changes in respective market risks. This is based on the financial assets and financial liabilities held at 31 March, 2018 and 31 March, 2017.

(i) Foreign currency exchange rate risk

Foreign currency risk is the risk that the fair value or future cash flows of an exposure will fluctuate because of changes in foreign exchange rates. The Company’s exposure to the risk of changes in foreign exchange rates relates primarily to the trade/other payables, trade/other receivables and derivative assets/liabilities. The risks primarily relate to fluctuations in US Dollars against the functional currencies of the Company. The Company’s exposure to foreign currency changes for all other currencies is not material. The Company evaluates the impact of foreign exchange rate fluctuations by assessing its exposure to exchange rate risks.

The following tables demonstrate the sensitivity to a reasonably possible change in US dollar exchange rates, with all other variables held constant. The impact on the Company’s profit before tax is due to changes in the fair value of monetary assets and liabilities.

(ii) Sensitivity

The sensitivity of profit or loss to changes in the exchange rates arises mainly from foreign currency denominated financial instruments and from foreign forward exchange contracts:

The movement in the pre-tax effect is a result of a change in the fair value of monetary assets and liabilities denominated in US Dollars where the functional currency of the entity is a currency other than US Dollars.

(iii) Interest rate risk

Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of change in market interest rates. The Company’s exposure to the risk of changes in market interest rates relates primarily to the Company’s debt obligations with floating interest rates. As the Company has certain debt obligations with floating interest rates, exposure to the risk of changes in market interest rates are dependent of changes in market interest rates. Management monitors the movement in interest rate and, wherever possible, reacts to material movements in such rates by restructuring its financing arrangement.As the Company has no significant interest bearing assets, the income and operating cash flows are substantially independent of changes in market interest rates.

Interest rate sensitivity

The following table demonstrates the sensitivity to a reasonably possible change in interest rates on that portion of loans and borrowings affected. With all other variables held constant, the Company’s profit before tax is affected through the impact on floating rate borrowings, as follows:

The assumed increase/decrease in interest rate for sensitivity analysis is based on the currently observable market environment

(B) Credit Risk

Financial assets of the Company include trade receivables, loans to wholly owned subsidiaries, employee advances, security deposits held with government authorities and others and bank deposits which represents Company’s maximum exposure to the credit risk.

With respect to credit exposure from customers, the Company has a procedure in place aiming to minimise collection losses. Credit Control team assesses the credit quality of the customers, their financial position, past experience in payments and other relevant factors.

The carrying amount of trade receivables, loans, advances, deposits, cash and bank balances, bank deposits and interest receivable on deposits represents company’s maximum exposure to the credit risk. No other financial asset carry a significant exposure with respect to the credit risk. Bank deposits and cash balances are placed with reputable banks and deposits are with reputable government, public bodies and others. The Company’s exposure to credit risk is influenced mainly by the individual characteristics of each customer. However, management also considers the factors that may influence the credit risk of its customer base, including default risk associate with the industry and country in which customers operate. Credit quality of a customer is assessed based on an extensive credit rating scorecard and individual credit limits are defined in accordance with this assessment. With respect to other financial assets viz., loans & advances, deposits with government and banks, the credit risk is insignificant since the loans & advances are given to its wholly owned subsidiary and employees only and deposits are held with government bodies and reputable banks. The credit quality of the financial assets is satisfactory, taking into account the allowance for credit losses.

Credit risk on trade receivables and other financial assets is evaluated as follows:

(iii) Significant estimates and judgements Impairment of financial assets:

The impairment provisions for financial assets disclosed above are based on assumptions about risk of default and expected loss rates. The company uses judgement in making these assumptions and selecting the inputs to the impairment calculation, based on the company’s past history, existing market conditions as well as forward looking estimates at the end of each reporting period.

(C) Liquidity risk

Prudent liquidity risk management implies maintaining sufficient cash and the availability of funding to meet obligations when due and to close out market positions. Company’s treasury maintains flexibility in funding by maintaining availability under deposits in banks.

Management monitors cash and cash equivalents on the basis of expected cash flows.

(i) Financing arrangements: The company had access to the following undrawn borrowing facilities at the end of the reporting period

(ii) Maturities of Financial liabilities

Contractual maturities of financial liabilities as at :

(iii) Management expects finance cost to be incurred for the year ending 31 March 2019 is Rs.7.92 Lakhs.

11. Capital management

Capital management and Gearing Ratio

For the purpose of the Company’s capital management, capital includes issued equity capital, share premium and all other equity reserves attributable to the equity holders. The primary objective of the company’s capital management is to maximise the shareholder value.

The Company manages its capital structure and makes adjustments in light of changes in economic conditions and the requirements of the financial covenants. The Company monitors capital using a gearing ratio, which is debt divided by total capital. The Company includes within debt, interest bearing loans and borrowings.

In order to achieve this overall objective, the Company’s capital management, amongst other things, aims to ensure that it meets financial covenants attached to the interest-bearing loans and borrowings that define capital structure requirements. Breaches in meeting the financial covenants would permit the bank to immediately call loans and borrowings.

No changes were made in the objectives, policies or processes for managing capital during the years ended 31 March, 2018 and 31 March, 2017.

12. Commitments

Estimated amount of contracts remaining to be executed on capital account and not provided for - Nil

* Post employment benefits are acturially determined on overall basis and hence not seperately provided. Details of outstanding balances as at the year end where related party relationship existed:

Details of outstanding balances as at the year end where related party relationship existed:

13. Segment information

The Company’s CEO, Whole time Director and Chief Financial Officer examine the Company’s performance from a service and product perspective and has identified two reportable segments:

1. Software development services

2. Software Licenses

They primarily use a measure of profit before tax to assess the performance of the operating segments.

Segment revenue and expenses:

The Company has an established basis of allocating joint expenses to the segments, which is reasonable, and followed consistently. All other segment revenue and expenses are attributable to the segments. Certain Expenses/Income are not specifically allocable to specific segments and accordingly these expenses are disclosed as unallocated corporate expenses or income and adjusted only against the total income of the company.Segment result includes the respective other income. Segment assets and liabilities:

Segment assets include all operating assets used by a segment and consist principally of operating cash, debtors and fixed assets, net of allowances and provisions that are reported as direct offsets in the balance sheet. While most assets can be directly attributed to individual segments, the carrying amount of certain assets used jointly by two or more segments is allocated to the segments on a reasonable basis. In such cases, the entire revenue and expenses of these assets including depreciation are also allocated to the same segments. Assets which are not allocable to the segments have been disclosed as ‘unallocated corporate assets’. Segment liabilities include all operating liabilities and consist principally of creditors and accrued liabilities. Segment assets and liabilities do not include deferred income taxes. The loans and other borrowings that are not specifically allocable to the various segments are disclosed as ‘unallocated corporate liabilities’.

Information about revenue

Revenue from external customers - Sale of Services - Rs. 36275.97 thousands

The Group has made external sales to the following customers meeting the criteria of 10% or more of the entity revenue Customer 1 - Rs. 3,22,716.27 thousands

Revenue from external customers - Sale of Products - Rs. 2,67,740.91 thousands

The Group has made external sales to the following customers meeting the criteria of 10% or more of the entity revenue Customer 1 - Rs. 2,20,267.76 thousands

The weighted average remaining contractual life for the share options outstanding as at March 31, 2018 was 6 years (March 31, 2017 : 7 years).

(C) Fair Valuation:

The fair value of option have been done by an independent firm of Chartered Accountants on the date of grant using the Black-Scholes Model.

The key assumptions in the Black-Scholes Model for calculating fair value as on the date of grant:

(a) For CTEL Employee Stock Opton Scheme - 2008

(b) For CTEL ESOP Scheme 2011_

(c) For ESOS 2015_

*Expected volatility on the Company’s stock price on Bombay Stock Exchange based on the data commensurate with the expected life of the options up to the date of grant.

(D) Details of the liabilities arising from the Share based payments were as follows:

Details of the liabilities arising from the Share based payments were as follows:

14. First-time adoption of Ind AS Transition to Ind AS

These are the Company’s first financial statements prepared in accordance with Ind AS.

The accounting policies set out in Note 2 have been applied in preparing the financial statements for the year ended 31 March, 2018, the comparative information presented in these financial statements for the year ended 31 March 2017 and in the preparation of an opening Ind AS balance sheet at 01 April 2016 (date of transition). In preparing its opening Ind AS balance sheet, the Company has adjusted the amounts reported previously in financial statements prepared in accordance with the accounting standards notified under Companies (Accounting standards) Rules, 2006 (as amended) and other relevant provisions of the Act(previous GAAP or Indian GAAP). An explanation on how the transition from previous GAAP to Ind AS has effected the Company’s financial position, financial performance and cash flows is set out in the following tables and notes.

Exemptions and Exceptions availed

Set out below are the applicable Ind AS 101 optional exemptions and mandatory exceptions applied in the transition from previous GAAP to Ind AS.

A. Ind AS optional exemptions

(i) Deemed cost

Ind AS 101 permits a first time adopter to elect to continue with the carrying value for all of its Property, plant & equipment as recognised in the Financial Statements as at the date of transition to Ind AS, measured as per the previous GAAP and use that as its deemed cost as at the date of transition, after making necessary adjustments for decommissioning liabilities. This exemption can also be used for Intangible assets covered by Ind AS 38. Accordingly, the Company has elected to measure all of its Property, plant & equipment and Intangible assets at their previous GAAP carrying value.

(ii) Impairment of financial assets

The Company has applied the exception related to impairment of financial assets given in Ind AS 101. It has used reasonable and supportable information that is available without undue cost or effort to determine the credit risk at the date that financial assets were initially recognised and compared that to the credit risk as at 01 April, 2016.

(iii) Investments in subsidiaries

Under previous GAAP, investment in subsidiaries, joint ventures and associates were stated at cost and provisions made to recognise the decline, other than temporary. Under Ind AS, the Company has considered their previous GAAP carrying amount as their deemed cost.

(iv) Share based payment transactions

Under previous GAAP, the cost of options granted under the CTE Employee Stock Option Scheme (CTE ESOS) [equity - settled] was recognised using the intrinsic value method. Under Ind AS, the cost of options granted under CTE ESOS is recognised based on the fair value of the options as on the grant date. In terms of the exemptions, the fair value of unvested options as at the date of transition have been accounted for as part of reserves.

B. Ind AS mandatory exceptions

(i) Estimates

An entity’s estimates in accordance with Ind ASs at the date of transition to Ind AS shall be consistent with the estimates made for the same date in accordance with previous GAAP(after adjustments to reflect any difference in accounting policies), unless there is objective evidence that those estimates were in error.

Ind AS estimates as at 1 April, 2016 are consistent with the estimates as at the same date made in conformity with previous GAAP. The Company made estimates for following items in accordance with Ind AS at the date of transition as these were not required under previous GAAP:-Investment in equity instruments carried at amortised cost-Impairment of financial asset based on expected credit loss model.

(ii) Classification and measurement of Financial Assets

Ind AS 101 requires an entity to assess classification and measurement of financial assets on the basis of the facts and circumstances that exist at the date of transition to Ind AS.

C. Reconciliation between previous GAAP and Ind AS ( as at 31 March 2017 and 1 April 2016)

Ind AS 101 requires an entity to reconcile equity, total comprehensive income and cash flows for prior periods.

D. Notes to first-time adoption:

1) Fair valuation of forward contracts:

Under previous GAAP, the premium or discount arising at the inception of a forward exchange contract should be amortised as expense or income over the life of the contract. Any profit or loss arising on cancellation or renewal of such a forward exchange contract should be recognised as income or as expense for the period.Under Ind AS 109, such forward contracts have to be carried at fair value through profit and loss. The profit for the year ended 31 March 2017 has increased by Rs. 5,767.49 thousands on account of fair value gain.

2) Deferred tax

Previous GAAP requires deferred tax accounting using the income statement approach, which focuses on differences between taxable profits and accounting profits for the period. Ind AS 12 requires entities to account for deferred taxes using the Balance Sheet approach, which focuses on differences between the carrying amount of an asset or liability in the Balance Sheet and its tax base. It requires recognition of tax consequences of differences between the carrying amounts of assets and liabilities and their tax base. As a result, Deferred tax asset has been increased by Rs. 13,653.30 thousands as at 1 April 2016 and Rs. 29,724.30 thousands as at 31 March 2017 with a corresponding increase in retained earnings and net profit respectively.

3) Remeasurements of post-employment benefit obligations

Under Ind AS, remeasurements i.e. Actuarial gains and losses and the return on plan assets , excluding amounts included in the net interest expense on the net defined benefit liability are recognised in other comprehensive income instead of profit or loss. Under the previous GAAP, these remeasurements were forming part of the profit or loss for the year. There is no impact on the total equity as at 31 March 2017.

4) Share based payments

Under the previous GAAP, expenditure relating to Employee stock option was valued as per Intrinsic value method. Under Ind AS, expenses are to be accounted as per Fair value method. Accordingly, expenditure of Rs. 4035.35 thousands was accounted during the year ended 31 March 2017 with a corresponding increase in net profit.

5) Expected credit loss on trade receivables

As per Ind AS 109, expected credit loss is calculated for trade receivables using the lifetime cycle approach. Accordingly, an amount of Rs. 472.50 thousands and Rs. 14.50 thousands is provided as on 1 April 2016 and 31 March 2017 respectively with a corresponding impact on retained earnings and net profit respectively.

6) Other comprehensive income

Under Ind AS, all items of income and expense recognized in a period should be included in the profit or loss for the period, unless a standard requires or permits otherwise. Items of income and expense that are not recognised in profit or loss but are shown in the statement of profit or loss as ‘other comprehensive income’ includes remeasurements of defined benefit plans. The concept of ‘other comprehensive income’ did not exist under previous GAAP.

7) Other equity

Retained earnings as at April 1 2016 has been adjusted consequent to the above Ind AS transition adjustments on the date of transition.

8) Cash flow from financing activities

Other bank balances (disclosed under Note 10) are not considered as part of cash and cash equivalents under Ind AS and the movement of other bank balances amounting to 22532.24 thousands is the variance in net increase/ decrease in cash and cash equivalents as at 31 March 2017.

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Mar 31, 2016

Note 1. Rights attached to Equity shares:

The company has only one class of shares referred to as equity shares having a par value of Rs.10/ -. Each holder of equity shares is entitled to one vote per share. The company declares and pays dividends in Indian Rupees. The dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting.

In the event of liquidation of the Company, the holder of quity shares will be entitled to receive any of the remaining assets of the Company in proportion to the number of equity shares held by the shareholders, after distribution of all preferential amounts.

Note.2. There are no transactions with Micro and Small enterprises, hence disclosures are not given as required under MSMED Act, 2006.

Note 3. Downstream investments made by Cambridge Technology Investments Pte Ltd, a 100% subsidiary of the Company in Singapore are in a start up stage and expected to yield results in the future. These investments are permanent in nature and hence temporary diminution, if any, in their value has not been provided for.

* 5,93,000 shares have been allotted at face value of SGD 1 on 05/04/2016.

Note 4. During the year, the Company has calculated Deferred Tax Asset on Income tax losses available for set off. Note 12: Long Term Loans and Advances

Note 5. Deposits with Statutory Authorities of Rs. 25 Lakhs (Previous year Rs.25 Lakhs) represents amount paid to Service Tax Authorities under protest.

Note 6. During the year, the company has transferred unclaimed dividend of Rs.83,286/- (Previous Year Rs. Nil) to Investor Education and Protection Fund on expiry of 7 Years.

The company has only one reportable segment viz., Income Technology Services. Hence, separate disclosures on segmental reporting as per AS-17 issued by ICAI is not made.

Note 7. Employee Stock Option Scheme

The Company has four stock option plans that are currently operational.

CTEL ESOP 2006

The 2006 Plan was approved by the Board of Directors on April 13, 2006 and by the shareholders on April 21, 2006, and further amended by the Shareholders on September 7, 2015 under which 1,236,542 options were granted up to 31st March, 2016.

Note: For Stock Options exercised during the year 2015-16, the weighted average share price is Rs. 82.35/-.

CTEL ESOP SCHEME 2008

The 2008 Plan was approved by the Board of Directors on March 20, 2008 and by the shareholders through postal ballot results of which was declared on March 5, 2008, and further amended by the Shareholders on September 7, 2015. 15,00,000 options granted under this scheme up to 31st March, 2016.

Note: For Stock Options exercised during the year 2015-16, the weighted average share price is Rs. 79.22/-. CTEL ESOP SCHEME 2011

The 2011 Plan was approved by the Board of Directors on December 10,2010 and by the shareholders through postal ballot results of which was declared on January 24,2011 and further amended by the Shareholders on September 7, 2015. 8,82,100 options were granted under this scheme up to 31^st March, 2016.

Note:

1. For Stock Options exercised during the year 2015-16, the weighted average share price is Rs. 54.42/- and for Stock Options exercised during the year 2014 - 15, the weighted average share price is Rs. 14.70/-.

2. For Stock Options outstanding as on 31.03.2016, the remaining contractual life is approximately 7 years & 3 Months.

ESOS - 2015

The Employee Stock Option Scheme - 2015 was approved by the Board of Directors on 29^th April, 2015 and by the shareholders through postal ballot results of which was declared on June 1, 2015. 2,18,500 options were granted under this scheme up to 31st March,2016.

Note: For Stock Options outstanding as on 31.03.2016, the remaining contractual life is approximately 8 years.

Note 8.

The Company has written-off the trade receivables amounting to Rs.21, 48, 81,750/- during the financial year 2012-13, due from erstwhile wholly owned step down subsidiary Cambridge Technology Enterprises Inc. The Company has made an application to RBI through an authorized dealer for the approval of the same which is pending.

Note 9.

ln order to present a true and factual financial position of the Company, the Board of Directors of the Company approved the draft Scheme of Reduction of Capital on 18.11.2015 to utilize the balance lying in the Securities Premium Account amounting to INR 2252 cr of the Company to write off the entire Goodwill amounting to INR 9.77 cr and the balance against the accumulated losses to the extent of INR 12.75 cr of the Company. The Company has obtained member''s approval for the same through EGM dated 06.04.2016 and is in the process of obtaining Hon''ble High Court''s approval .The reduction in capital will result in reflecting the actual Net worth of the Company

Note 10.

Previous year''s figures are regrouped/rearranged wherever considered necessary to conform to the current year figures.

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Mar 31, 2015

1. Group overview

Cambridge Technology Enterprises Limited, "the Company", its subsidiary (collectively referred to as "the Group") are primarily global technology services and outsourcing Group dedicated to serving the midsize market enterprises and the midsize units of Global 2000 enterprises across the spectrum of business industries. The Group is recognised as a thought leader and innovator of comprehensive Service Oriented Architecture (SOA)-based enterprise transformation and integration solutions and services.

2. Subsidiaries considered for consolidation

The subsidiary considered in the preparation of these consolidated financial statements are:

NOTE: Cambridge Technology Inc. is a subsidiary of Cambridge Technology Enterprises w.e.f 9th December, 2014.

3. The Company has written-off the trade receivables amounting to Rs.21,48,81,750/- during the previous year 2012-13, due from erstwhile wholly owned step down subsidiary Cambridge Technology Enterprises Inc. The company has made an application to RBI through the authorized dealer for the approval of the same.

4. The Company has written-off the trade receivables amounting to Rs.4,46,389/- during the current year 2014-15.

5. M/s. Cambridge Technology India Private Limited which is a 100% subsidiary of CTE has got merged in CTE with effective from 1st April 2012 under the method Amalgamation by Merger as per the Honorable Karnataka High Court Order dated 7th August, 2014. All the Assets and liabilities of M/s. Cambridge Technology India Private Limited has taken into books of accounts of CTE on 1st April 2014 at book values. There is no allotment of equity shares of CTE to M/s. Cambridge Technology India Private Limited share holders since it is a 100% subsidiary to CTE.

6. As per the Amalgamation order the Cambridge Technology India Private Limited merged with Cambridge Technology Enterprises Limited with effect from 1st April 2012. Due to this necessary adjustments in opening balances and closing balances of Cambridge Technology India Private Limited are considered in the financials of Cambridge Technology enterprises Limited for the year ending 31st March, 2015.

7. The Cambridge Technology Enterprises Limited income is including the Cambridge Technology India Private Limited income as per the court order. Necessary TDS credits and income of Cambridge Technology India Private Limited are included in Cambridge Technology Enterprises Limited for the year ending 31st March, 2015.

8. The Company CTE has sold its assets for an amount of Rs. 12,75,308/- and it has incurred a loss of Rs. 95,038/-.

9. Details of Deposits

Deposit amount consists of Rental Deposit of Cyber Pearl building for Hyderabad Office premises, Chandrasagar Enterprises for Bangalore Branch, Regus Chennai Office Centre Pvt Ltd for Chennai Office Premises and Regus Suburbs Centre Pvt Ltd for Mumbai Office Premises. Fixed Deposits in Axis Bank and SBH and others.

29. Employee Stock Option Scheme

The Group has three stock option plans that are currently operational.

CTEL ESOP 2006

The 2006 Plan was approved by the board of directors on April 13, 2006 and by the shareholders on April 21, 2006, under which scheme 1,236,542 options were granted till date of 31st March, 2015.

Changes in number of options outstanding were as follows:

* Options were lapsed for those who had left the company or didn''t exercise their options during the vesting period of their options

CTEL ESOP SCHEME2008

The 2008 Plan was approved by the board of directors on March 20, 2008 and by the shareholders through postal ballot results of which was declared on March 5, 2008, under which scheme 1,500,000 options were granted till date of 31st March, 2015.

Changes in the number of options outstanding:

CTEL ESOP SCHEME 2011

The 2011 Plan was approved by the board of directors on December 10, 2010 and by the shareholders through postal ballot results of which was declared on January 24, 2011, under which scheme 644,000 options were granted till date of 31st March, 2015.

Changes in the number of options outstanding:

* Options were lapsed for those who had left the company or didn''t exercise their options during the vesting period of their options.

Pro forma Disclosure

In accordance with SEBI (Employee Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines, 1999, had the compensation cost for associate stock option plans been recognized based on the fair value at the date of grant in accordance with Black Scholes'' model, the pro forma amounts of the Group''s net profit and earnings per share would have been as follows:

The key assumptions used in Black-Scholes'' model for calculating fair value are: risk-free interest rate ranging from 6.73% to 7.85% (2012 - 6.73% to 7.85%), expected life: 3 years to 4 years (2012 - 3 years to 4 years), expected volatility of shares 63.77% to 72.66% (2012 - 63.77% to 72.66%), dividend yield 0% (2012 - 0%). The range variables detailed herein represent the highs and the lows of the assumptions during the pendency of the grant dates.

10. Related party transactions

Key Management Personnel

Stefan Hetges Whole-time Director and Chief Executive Officer

D.R.R Swaroop Whole-time Director

V Ramana Reddy Chief Financial Officer and Company Secretary

Enterprises over which Control exists

Cambridge Technology Inc. Wholly owned subsidiary w.e.f December 2014 Smart Shift Technologies Inc. Associate company (common Director)

Enterprises over which significant influence exercised by key management personnel/close family member of key management personnel D.S. UnicsInfotech limited D.R.R. Swaroop is a Director in the Company SmartShift Technologies Inc. Stefan Hetges is a Director in the Company

11. Leases Operating Lease

The Company hires office premises under operating lease agreement that is renewable on a periodic basis at the option of both the lessor and the lessee. Rental expense under those leases was Rs.17, 658,188/-(Previous year Rs. 19,218,457/-).

Finance Leases

The Company is not having any finance lease agreements as at March 31, 2015.

12. Segment reporting

As required by the Accounting Standard - 17, ''Segment reporting'', the Company is mainly engaged in the area of software development and related services. Hence segment reporting is not applicable to the Company and to the nature of business.

13. Managerial Remuneration

The key management personnel comprise our directors and statutory officers. Particulars of remuneration and other benefits provided to key management personnel during the year ended March 31, 2015 and 2014 are as follows:

*Remuneration is net of accrual towards Gratuity, a defined benefit plan and provident fund which is managed for the Company as a whole. Contributions to defined benefit plan and provident fund and other perquisites and allowances have been included in Schedule 18 and 20.

NOTE: Balance Outstanding as per 31st March,2015 is nil because Cambridge Technology India Pvt Ltd got merged with Cambridge Technology EnterprisesLimited with effect from 1.04.2014.

14. Retirement benefits to employees

Defined contribution plan

During year ended March 31, 2014, the Group contributed Rs. 5,164,472/- to provident fund (Previous Year Rs.38, 19,331/-was contributed to provident fund).

Defined benefit plan - gratuity and privilege leave.

The amounts recognized in the balance sheet as at March 31, 2015 are as follows:

The estimates of future salary increase, considered in actuarial valuation, take account of inflation, seniority, promotions and other relevant factors such as supply and demand in the employment market. The Company evaluates these assumptions annually based on its long term plans of growth and industry standards.

15. Contingent Liabilities:

i) The company is having the following disputed liabilities with the Service Tax Dept. and Income Tax Dept.

Nature of Assessment year Demand in Rs Status liability

Service Tax 2007-08 to 2009-10 3,25,76,183 Pending before Service Tax Tribunal and received stay order dated 30th October 2013 against recovery by Tax the Service dept.

Income Tax 2010-11 7,38,54,455 ITAT Appeal Filed

16. Payables to micro enterprises and small enterprises

There were no overdue principal amounts (and interest thereon) payable to micro enterprises and small enterprises, as at March 31, 2015.

17. Quantitative details

The Company is engaged in the development and maintenance of computer software. The production and sale of such software cannot be expressed in any generic unit. Hence, it is not practicable to give the quantitative details of sales and certain other information as required under paragraphs 3, 4A, 4C and 4D of Part II of Schedule VI to the Companies Act, 1956.

18. Prior year comparatives.

Previous years'' figures have been regrouped and reclassified wherever necessary to confirm to current year''s classification.

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Mar 31, 2014

1. Company overview

Cambridge Technology Enterprises Limited, "the Company" is an information technology services provider dedicated to serving the midsize market enterprises and the midsize units of Global 2000 enterprises across the spectrum of business industries. The Company was incorporated on January 28, 1999 in Hyderabad, Andhra Pradesh, India.

2. The Company has written-off the trade receivables amounting to Rs.21,48,81,750/- during the previous year 2012-13, due from erstwhile wholly owned step down subsidiary Cambridge Technology Enterprises Inc. The company has made an application to RBI through the authorized dealer for the approval of the same.

3. The Company has made a petition on 18th July, 2013 with the High Court for the merger of its wholly owned subsidiary Cambridge Technology India Private Limited. The decision of high Court is awaited in this matter.

4. Details of Deposits

Deposit amount consists of Rental Deposit of Cyber Spazio building, Fixed Deposits in Axis Bank and SBH and others.

5. Employee Stock Option Scheme

The Group has three stock option plans that are currently operational.

CTEL ESOP 2006

The 2006 Plan was approved by the board of directors on April 13, 2006 and by the shareholders on April 21, 2006, under which scheme 1,236,542 options were granted till date of 31st March, 2014.

Changes in number of options outstanding were as follows:

* Options were lapsed for those who had left the company or didn''t exercise their options during the vesting period of their options

CTEL ESOP SCHEME 2008

The 2008 Plan was approved by the board of directors on March 20, 2008 and by the shareholders through postal ballot results of which was declared on March 5, 2008, under which scheme 1,500,000 options were granted till date of 31st March, 2014.

Changes in the number of options outstanding:

CTEL ESOP SCHEME 2011

The 2011 Plan was approved by the board of directors on December 10, 2010 and by the shareholders through postal ballot results of which was declared on January 24, 2011, under which scheme 644,000 options were granted till date of 31st March, 2014.

Changes in the number of options outstanding:

* Options were lapsed for those who had left the company or didn''t exercise their options during the vesting period of their options

Pro forma Disclosure

In accordance with SEBI (Employee Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines, 1999, had the compensation cost for associate stock option plans been recognized based on the fair value at the date of grant in accordance with Black Scholes'' model, the pro forma amounts of the Group''s net profit and earnings per share would have been as follows:

The key assumptions used in Black-Scholes'' model for calculating fair value are: risk-free interest rate ranging from 6.73% to 7.85% (2012 - 6.73% to 7.85%), expected life: 3 years to 4 years (2012 - 3 years to 4 years), expected volatility of shares 63.77% to 72.66% (2012 - 63.77% to 72.66%), dividend yield 0% (2012 - 0%). The range variables detailed herein represent the highs and the lows of the assumptions during the pendency of the grant dates.

Enterprises over which Control exists

Cambridge Technology India Private Limited (''CTIPL'')Wholly owned subsidiary w.e.f October 2008

Enterprises over which significant influence exercised by key management personnel/close family member of key management personnel

D.S. Unics Infotech limited - D.R.R. Swaroop is a Director in the Company

SmartShift Technologies Inc. - Stefan Hetges is a Director in the Company

(Formerly known as Cambridge Technology Enterprises Inc.)

6. Leases

Operating Lease

The Company hires office premises under operating lease agreement that is renewable on a periodic basis at the option of the both the lessor and the lessee. Rental expense under those leases was Rs.19,218,457/ - (Previous year Rs. 11,883,622/-).

Finance Leases

The Company is not having any finance lease agreements as at March 31, 2014.

7. Segment reporting

As required by the Accounting Standard - 17, ''Segment reporting'', the Company is mainlyengaged in the area of software development and related services. Hence segment reporting is not applicable to the Company and to the nature of business.

8. Managerial Remuneration

The key management personnel comprise our directors and statutory officers. Particulars of remuneration and other benefits provided to key management personnel during the year ended March 31, 2014 and 2013are as follows:

*Remuneration is net of accrual towards Gratuity, a defined benefit plan and provident fund which is managed for the Company as a whole. Contributions to defined benefit plan and provident fund and other perquisites and allowances have been included in Schedule 19 and 21.

9. Retirement benefits to employees

Defined contribution plan

During year ended March 31, 2014, the Company contributed Rs. 2,528,264/- to provident fund (Previous Year Rs. 28,71,447/- was contributed to provident fund).

Defined benefit plan - gratuity and privilege leave

The amounts recognized in the balance sheet as at March 31, 2014 are as follows:

The estimates of future salary increase, considered in actuarial valuation, take account of inflation, seniority, promotions and other relevant factors such as supply and demand in the employment market. The Company evaluates these assumptions annually based on its long term plans of growth and industry standards.

10. Supplementary Information

i) The Company is having contingent service tax liability for an amount ofRs.3,25,76,183/- which is pending before Service Tax AppellateTribunal, South Zonal Bench, Bangalore and in this connection company has received stay order dated 30th October 2013 against recovery by the Service Tax department.

ii) For the A.Y 2009-10 disputed tax liability of Rs. 38,36,711/- is pending before honorable ITAT.

11. Payables to micro enterprises and small enterprises

There were no overdue principal amounts (and interest thereon) payable to micro enterprises and small enterprises, as at March 31, 2014.

12. Quantitative details

The Company is engaged in the development and maintenance of computer software. The production and sale of such software cannot be expressed in any generic unit. Hence, it is not practicable to give the quantitative details of sales and certain other information as required under paragraphs 3, 4A, 4C and 4D of Part II of Schedule VI to the Companies Act, 1956.

13. Prior year comparatives.

Previous years'' figures have been regrouped and reclassified wherever necessary to confirm to current

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Mar 31, 2013

1. During the year under review the debt holders in the Company''s wholly owned subsidiary smartShiftgroup Limited (formerly known as Cambridge Technology Enterprises- Mauritius Limited) have converted their debt to the extent of $ 4,137,930 into equivalent number of equity shares. With this conversion the Company''s equity holding has come down to 29.68% from 100%.

2. The Company sold the residual stake of 29.68% for a consideration of US$25,000 for which the company has submitted information to the authorized dealer to ratify the same. This transaction has resulted into a loss of Rs.27,28,98,671 during the year as the carrying value of the investment was Rs.27,42,60,626. The valuation of smartShiftgroup Limited as on the date of transaction was negative Rs. 21.11 crores which was carried out by an independent expert.

3. The Company written off the trade receivables, amounting to Rs.21,48,81,750 due from erstwhile wholly owned step down subsidiary Cambridge Technology Enterprises Inc. The company has made an application to RBI through the authorized dealer for the approval of the same.

4. The Company has made a petition with the High Court for the merger of its wholly owned subsidiary Cambridge Technology India Private Limited. The decision of high Court is awaited in this matter.

5. The Company has consolidated the Profit & Loss statements of erstwhile subsidiary companies for the period from 1st April, 2012 to 26th March, 2013 i.e., till the date on which the subsidiary smartShiftgroup Limited (formerly known as Cambridge Technology Enterprises - Mauritius Limited) and resulting step down subsidiaries - Cambridge Technology Enterprises Inc., smartShift GmbH and VoxHoldings Inc were sold.

6. Details of Deposits

Deposit amount consists of Rental Deposit of Cyber Spazio building, Fixed Deposits in Axis Bank and SBH and others.

7. Employee Stock Option Scheme

The Group has three stock option plans that are currently operational.

CTEL ESOP 2006

The 2006 Plan was approved by the board of directors on April 13, 2006 and by the shareholders on April 21, 2006, under which scheme 1,236,542 options were granted till date of 31st March, 2013.

8. Related party transactions

Key Management Personnel

Stefan Hetges Whole-time Director and Chief Executive Officer

D.R.R Swaroop Whole-time Director

Enterprises over which Control exists

Cambridge Technology Enterprises Wholly owned subsidiary w.e.f 13 August 2010

- Mauritius Limited (''CTEM'')

Cambridge Technology Enterprises Inc (''CTE Inc'') Wholly owned subsidiary of CTEM w.e.f 1 October 2010

smart Shift, GmbH - Germany Wholly owned subsidiary of CTEM w.e.f 1st Oct, 2010.

Vox Holding Inc. - USA Wholly owned subsidiary of CTEM w.e.f 1st Oct,2010

Cambridge Technology India Private Wholly owned subsidiary w.e.f October 2008

Limited (''CTIPL'')

ComcreationInc Wholly owned subsidiary of CTE Inc, w.e.f 2007-08, got

Reilly & Associates Inc merged with CTE Inc. w.e.f 24th June 2010.

CellExchangeInc

Note : Control over above subsidiaries has been ceased from 26th March, 2013 due to sale of Smartshift group Limited which is a wholly owned subsidiary of M/s. Cambridge Technology Enterprises Limited to Smartshift Group Inc.

Enterprises over which significant influence exercised by key management personnel/close family member of key management personnel

9. Leases

Operating Lease

The Company leases office premises under operating lease agreement that is renewable on a periodic basis at the option of the both the lessor and the lessee. Rental expense under those leases was Rs.11,883,622/- (Previous year Rs. 9,148,802/-).

10. Segment reporting

As required by the Accounting Standard - 17, ''Segment reporting'', the Company is mainlyengaged in the area of software development and related services. Hence segment reporting is not applicable to the Company and to the nature of business.

11. Retirement benefits to employees

Defined contribution plan

During year ended March 31, 2013, the Company contributed Rs. 2,871,447/- to provident fund (Previous Year Rs. 2,537,905/- was contributed to provident fund).

Defined benefit plan - gratuity and privilege leave

12. Supplementary Information

Contingencies & Guarantees

i) Previous year, the company has given corporate guarantee as against Senior Secured Convertible Debt Notes, Convertible Debt Notes and Redeemable Bonds issued by the subsidiary M/s. Cambridge Technology Enterprises Mauritius Limited to the extent of Rs.647.43 Millions (USD 14.50 Millions). As of 31st March 2013, this corporate guarantee was extinguished since smartShiftgroup Limited no longer remain the wholly owned subsidiary which was sold on 27th March, 2013.

ii) The Company is having contingent service tax liability for an amount of Rs.3,25,76,183/- which is pending before Service Tax AppellateTribunal, South Zonal Bench, Bangalore.

13. Payables to micro enterprises and small enterprises

There were no overdue principal amounts (and interest thereon) payable to micro enterprises and small enterprises, as at March 31, 2013.

14. Quantitative details

The Company is engaged in the development and maintenance of computer software. The production and sale of such software cannot be expressed in any generic unit. Hence, it is not practicable to give the quantitative details of sales and certain other information as required under paragraphs 3, 4A, 4C and 4D of Part II of Schedule VI to the Companies Act, 1956.

15. Prior year comparatives.

Previous years'' figures have been regrouped and reclassified wherever necessary to confirm to current year''s classification.

16. Company overview

Cambridge Technology Enterprises Limited, "the Company" is an information technology services provider dedicated to serving the midsize market enterprises and the midsize units of Global 2000 enterprises across the spectrum of business industries. The Company was incorporated on January 28, 1999 in Hyderabad, Andhra Pradesh, India.

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Mar 31, 2012

1. Group overview

Cambridge Technology Enterprises Limited ("the Company"), its subsidiaries (collectively referred to as "the Group") are primarily global technology services and outsourcing Group dedicated to serving the midsize market of enterprises and the midsize units of Global 2000 enterprises across the spectrum of business industries. The Group is recognized as a thought leader and innovator of comprehensive Service Oriented Architecture (SOA)-based enterprise transformation and integration solutions and services.

2. Impairment of Intangible Asset- Reusable Components

During the financial year, the company has accounted impairment loss of Rs.44, 523,396 (FY 2011- Nil) on reusable components after testing the recoverable value of recorded cost. This is due to shift in the business focus and the change in Industry trend, the reusable components developed earlier have become almost obsolete and now find use only in a small segment of Company's business. In view of this, the Techno-Commercial assessment done by technical team opined that it is unlikely that these components would generate any substantial revenues in the future. After reviewing the assessment of the Technical team, management decided that it is financially prudent to write-off the entire residual carrying value as on 31-Mar-2012.

3. Goodwill on Consolidation

a. During October 2010, the Group acquired all the outstanding equity shares of smartshift GmbH, Mannaheim, Germany, which is mainly in the business of ERP data migration and coding, for a consideration of Rs. 49,850,494 (inclusive of acquisition costs). The group has recorded goodwill of Rs. 50,911,098 representing the difference between the initial cash consideration and the book value of negative net assets as at the date of acquisition Rs. 1,060,604.

b. During October 2010, the Group acquired all the outstanding equity shares of VoxHolding Inc., Cambridge, United States of America, which is mainly in the business of enabling cloud computing services, for a consideration of Rs. 44,114,446 (inclusive of acquisition costs). The group has recorded goodwill of Rs. 50,911,098 representing the difference between the initial cash consideration and the book value of negative net assets as at the date of acquisition Rs. 1,645,244.

c. During April 2007, the Group acquired all the outstanding equity shares of Comcreation Inc. and its Indian subsidiary Comcreation Technologies Private Limited for a consideration of Rs. 91,905,758 (inclusive of acquisition costs).The group has recorded goodwill of Rs. 76,111,034 representing the difference between the initial cash consideration and the book value of net assets as at the date of acquisition Rs. 15,794,724. Due to non achievement of certain revenue and performance targets, the company waived off Rs. 9,320,000 from the consideration balance due as on. Hence, the same is adjusted to the goodwill on consolidation.

d. During July 2007, the Company acquired all the outstanding shares of Reilly & Associates Inc., Michigan, United States of America for a initial cash consideration of Rs. 87,171,373 (inclusive of acquisition costs). The group has recorded goodwill of Rs. 95,938,450 representing the difference between the initial cash consideration and the book value of negative net assets as at the date of acquisition of Rs. 8,767,077. Due to non achievement of certain revenue and performance targets, the company waived off Rs. 1,617,030 from the consideration balance due as on. Hence, the same is adjusted to the goodwill on consolidation.

e. The goodwill on consolidation will be restated based on the future payment of earn outs based on the performance criteria specified in the respective agreements.

4. Impairment of Goodwill :

For the purpose of impairment testing, goodwill is allocated to the subsidiary which represents the lowest level within the Group at which the goodwill is monitored for internal management purpose.

During the financial year, the Group has recognised impairment loss on goodwill on consolidation of Rs.458,104,045(FY2011 – Nil) due to significant changes with an adverse effect have taken place during the period in the technological, market and economic environment in which the entity operates and impacted it's of the financial position and financial performance of subsidiaries.

The balance of the goodwill on consolidation of Rs.260,960,675(FY2011 – Rs.719,364,720) is related to focused technology and the recoverable amount is determined based on the cash flow projections derived from future financial budgets. The key assumptions used in the calculations are as follows:- (a) Sales growth rate of 10% year to year for three years. (b) Discount rate of 10%.

Based on the recoverable amount determined, goodwill on consolidation related to the focused technology is not impaired for the current financial year.

5. Employee Stock Option Scheme

The Group has three stock option plans that are currently operational.

CTEL ESOP 2006

The 2006 Plan was approved by the board of directors on April 13, 2006 and by the shareholders on April 21, 2006, under which scheme 1,236,542 options were granted till date of 31st March, 2012.

CTEL ESOP SCHEME 2011

The 2011 Plan was approved by the board of directors on December 10, 2010 and by the shareholders through postal ballot results of which was declared on January 24, 2011, under which scheme 624,000 options were granted till date of 31st March, 2012.

6. Related party transactions

Key Management Personnel

Stefan Hetges Whole-Time Director and Chief Executive Officer

(w.e.f 15 November 2010)

D.R.R Swaroop Whole-Time Director

Samir Bhatia Whole-Time Director and Chief Financial Officer (w.e.f 14 February 2011)

Arjun Chopra Whole-Time Director (w.e.f 19 April 2010 up to 15 November 2010)

Enterprises over which significant influence exercised by key management personnel/close family member of key management personnel

D.S. Unics Infotech Pvt Ltd D.R.R. Swaroop is a Director in the Company

7. Leases

Operating Leases

The Group leases offices under operating lease agreements that are renewable on a periodic basis at the option of both the lessor and the lessee. Rental expenses under those leases were Rs.15,265,012/- (Previous year Rs. 17,804,908/-)

8. Segment reporting

As required by the Accounting Standard – 17, 'Segment reporting', the Group is mainly engaged in the area of software development and related services. Hence segment reporting is not applicable to the Group and to the nature of business.

9. Retirement benefits to employees

Defined contribution plan

During year ended March 31, 2012, the Group contributed Rs.3,773,406/- to provident fund.

Defined benefit plan – gratuity and privilege leave

10. Contingencies & Guarantees

During the year, the company has given corporate guarantee as against Senior Secured Convertible Debt Notes, Convertible Debt Notes and Redeemable Bonds issued by the subsidiary M/s. Cambridge Technology Enterprises Mauritius Limited to the extent of Rs.647.43 Millions (USD 14.50 Millions).

11. Prior year comparatives

Previous years' figures have been regrouped and reclassified wherever necessary to conform to current year's classification.

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Mar 31, 2010

1.1 Details of Investments

1.2 Employee Stock Option Scheme

The Company has two stock option plans that are currently operational.

CTEL ESOP 2006

The 2006 Plan was approved by the board of directors on April 13, 2006 and by the shareholders on April 21, 2006, under which scheme 987,542 options were granted till date of 31st March, 2010.

CTEL ESOP SCHEME 2008

The 2008 Plan was approved by the board of directors on March 20, 2008 and by the shareholders through postal ballot results of which was declared on March 5, 2008, which provides for 1,500,000 options.

Pro forma Disclosure

In accordance with SEBI (Employee Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines, 1999, had the compensation cost for associate stock option plans been recognized based on the fair value at the date of grant in accordance with Black Scholes model, the pro forma amounts of the Groups net profit and earnings per share would have been as follows:

The key assumptions used in Black-Scholes model for calculating fair value are: risk-free interest rate ranging from 7.21% to 7.73 % (2009 – 7.57% to 7.61%), expected life: 2.5 years to 4 years (2009 – 2.5 years to 4.5 years), expected volatility of shares 63.77% to 72.66% (2009 – 63.77% to 72.66%), dividend yield 0% (2009 – 0%). The range variables detailed herein represent the highs and the lows of the assumptions during the pendency of the grant dates.

1.3 Related party transactions

Key Management Personnel

Bhaskar Panigrahi Chairman and Chief Executive Officer

Cambridge Technology Ent erprises Inc (‘CTI) Wholly owned subsidiary

CTE Global Solutions Pvt. Ltd. Wholly owned subsidiary w.e.f. February, 2008 till

(Formerly known as Comcrea tion Technologies Private Limited (CTPL) ) October, 2009

Cambridge Technology India Pvt. Ltd. (CTIPL) Wholly owned subsidiary w.e.f. October, 2008 (Formerly known as Qsoft System and Solutions Private Limited (Qsoft)

Comcreation Inc (CCI) Wholly owned subsidiary of Cambridge Reilly & Associates Inc (Reilly) Technology Enterprises Inc, w.e.f 2007-08. * CellExchange Inc (CX)** -J

* refer note 3.1 for details

** CellExchange Inc was a company under Common control till December 31, 2007.

Enterprises over which significant influence exercised by key management personnel/close family member of key management personnel.

1.4 Leases

Operating Lease

The Company has taken leased office premises under operating lease agreement that is renewable on a periodic basis at the option of the both the lessor and the lessee. Rental expense under those leases was Rs.10, 046,237 / (Previous year Rs.10, 623,730).

Finance Leases

1.5 Segment reporting

As required by the Accounting Standard – 17, ‘Segment reporting, the Company is mainly engaged in the area of software development and related services. Hence segment reporting is not applicable to the Company and to the nature of business. The Companys total exports are to United States of America.

*Remuneration is net of accrual towards Gratuity, a defined benefit plan and provident fund which is managed for the Company as a whole. Contributions to defined benefit plan and provident fund and other perquisites and allowances have been included in Schedule 14 and 15.

1.6 Retirement benefits to employees

Defined contribution plan

During year ended March 31, 2010, the Company contributed Rs.459, 747/- to provident fund (Previous Year Rs.244, 640/- was contributed to provident fund).

The estimates of future salary increase, considered in actuarial valuation, take account of inflation, seniority, promotions and other relevant factors such as supply and demand in the employment market. The Company evaluates these assumptions annually based on its long term plans of growth and industry standards.

1.7 Misc. Income

Misc Income includes 2.33 Crores on account of cancellation of option of exercising preferential warrants and balance of 3.5 Lacs towards on account of gain on sale of investment.

1.8 Supplementary Information

(i) Commitments and contingencies

Contingent consideration payable as at March 31, 2010 in respect of acquired subsidiary Companies Rs. 27,580,450/-

1.9 Payables to micro enterprises and small enterprises

There were no overdue principal amounts (and interest thereon) payable to micro enterprises and small enterprises, as at March 31, 2010.

1.10 Quantitative details

The Company is engaged in the development and maintenance of computer software. The production and sale of such software cannot be expressed in any generic unit. Hence, it is not practicable to give the quantitative details of sales and certain other information as required under paragraphs 3, 4A, 4C and 4D of Part II of Schedule VI to the Companies Act, 1956.

1.11 Prior year comparatives.

Previous years figures have been regrouped and reclassified wherever necessary to confirm to current years classification.