ANNUAL RESULTS FOR THE YEAR ENDED 31 MARCH 2021

RNS Number : 9194C

iEnergizer Limited

24 June 2021

 

iEnergizer Ltd.
 ("iEnergizer" or the "Company" or the "Group")

ANNUAL RESULTS FOR THE YEAR ENDED 31 MARCH 2021
 

iEnergizer, the technology services and media solutions leader for the digital age, reports annual results for the year ended March 31, 2021 with continued revenue and margin growth generating a substantial return and exceeding management expectations during the worst pandemic in living memory. Improved results in a full 12 months of pandemic are testament to staff and management in the most testing of years. This strong performance, together with the recurring nature and longevity of contracts, gives the Board confidence to continue the progressive dividend policy and propose a 8.4p final dividend payment to shareholders, representing a total dividend payment of 14.12p, a 4% increase compared to 2020.

 Financial Highlights:

Enhanced profitability with revenue growth and margin improvements achieved through continued focus on higher margin work, deepening of existing customer relationships and accrual of several new customers, alongside active cost management and productivity gains from the Group's transition to remote working .

●	Total Revenue up 2.8% at $200.3m (2020: $194.9m)
●	Service Revenue up 2.6% at $196.0m (2020: $191.0m)
●	EBITDA up 7.6% at $64.3m (2020: $59.7m) representing an EBITDA margin of 32.1% (2020: 30.7%)
●	Operating Profit up 2.6% at $57.6m (2020: $56.1m)
●	Profit Before Tax (PBT) up 1.8% at $53.5m (2020: $52.5m)
●	Profit After Tax (PAT) up 8.7% at $48.9m (2020: $45.0m)
●	Earnings per share $0.26 (2020: $0.24)
●	Net debt of $115.9m (2020: Net Cash $1.6m) following a special dividend of 49.4p per ordinary share ($127.3m), representing 1.8x EBITDA for the period
●	Entered into new $165m five-year senior secured term loan facility on more favourable terms compared with previous facility
●	Total dividend of 14.12p per ordinary share ($36.60m) (2020: 13.6p) including interim dividend of 5.72p, an increase of 4%

Operational Highlights:

Continued focus on higher margin work and success in securing further work with existing and new customers, supported by new product launches and growth in digital learning and entertainment space.

· Despite the COVID-19 pandemic, iEnergizer increased share of revenue from some of its key international clients operating in growth verticals of Media & Entertainment and Online Training & Education ; and added several new customers in E-Learning and Healthcare & Pharmaceuticals industry segments

· Business Process Outsource revenue grew 2.6% year on year, maintaining 63.3% of revenue share (63.2% in 2020) as some of its key customers continued to increase workload volumes, and the segment also added several new customers contributing $5.8m to Group revenue, which compensated for a temporary reduction in revenue from the travel segment, which was impacted by COVID-19 restrictions . The focus remained on adding new customers in growth verticals like Healthcare and Entertainment, and on generating recurring revenue streams from long-term customer relationships across all verticals

· Business Process Outsource services grew EBITDA margins to 34.9% (2020: 33.1%) on account of increased volumes from BPO's largest and high margin international media and entertainment vertical, offsetting the negative impact on smaller verticals (low-margin India based travel segment)

· Content Services segment grew its revenue 2.6% over fiscal 2021 on account of increased volumes from key clients and added several new clients primarily in its E-Learning and Digital training divisions contributing $1.8m to Group revenue, which also compensated for some temporary revenue reduction impact due to delays in launching of some publishing related projects owing to global lockdowns

· Content Services EBITDA margins exceeded 27% owing to higher efficiencies achieved due to work from home operations resulting in productivity gains and overheads related cost savings

· Maintained growth in EBTIDA through fiscal 2021 due to revenue growth and the impact of our continued focus on cost saving initiatives:

o	Growth in higher margin International BPO business and E-Learning business have contributed to the overall Group revenue and profitability
o	Invested in technology reducing throughput time of different processes leading to productivity gains resulting in higher margins
o	Invested in IT infrastructure to facilitate smooth transition to an efficient remote working operation
o	Promoted effective utilization of resources through increasing shift utilization at the work place operating on a 24/7 delivery model out of Group's India based delivery centers in line with the requirements of different customers

· US based sales team pursuing strategies to: enhance and grow key accounts; identify and win new business through existing and new customers, with special focus on Healthcare, Digital Education and Digital Training sectors ; cross-sell and generate leads for new service lines

· Refinancing - As previously announced to the market, iEnergizer group entered into a 5-year senior secured term loan facility for an aggregate amount of $165,000,000, including a $15,000,000 revolving credit facility. The senior secured term loan facility bears floating interest rate per annum equal to LIBOR plus 3.5% per annum (with a 0.75% LIBOR floor), which was used to refinance its existing term loan in full and utilize the balance amounts to return cash to the shareholders subsequently paid as a Special Dividend (49.4 p per share)

· COVID-19 impact - The Group has taken important steps to ensure that it is well positioned to fully support the requirements, health and wellbeing of its clients and employees in this unprecedented period. The business is operating at above 95% efficiency across all of its service lines as most employees have now been successfully transitioned to remote working. The Group's balance sheet, net cash position and its long-term customer relationships remain strong

Dividends:

●	In line with the progressive dividend policy, the Company is pleased to announce a final dividend of 8.4p with the Dividend record date of 2 July, 2021 in addition to the interim dividend of 5.72p which was paid in November 2020.
●	The Company's Ordinary Shares are expected to go ex-dividend on 1 July, 2021 and the dividend is expected to be paid on 31 July, 2021
●	These dividend payments reflect the Company's continued strong performance through the period and the Board's confidence in the Group's business strategy and growth prospects

Marc Vassanelli, Chairman of iEnergizer, commented:

"We are delighted to report another strong performance by iEnergizer, achieving growth in revenue despite challenges faced due to the COVID-19 pandemic and as guided on 13th January 2021 exceeding market expectations for EBITDA, due to the significant progress made by colleagues across all divisions, focusing on high margin revenue.

"Reflecting the Group's strong balance sheet and the cash generative nature of the business, coupled with the Board's confidence in the business strategy and growth prospects, we are pleased to announce a final dividend of 8.4p for fiscal 2021, in line with the dividend policy adopted in 2019.

"Importantly, we have secured several new customers across all of our divisions, as well as maintaining and deepening relationships with our existing key customers. The business has maintained a successful focus on recurring revenue streams, by capitalizing on iEnergizer's advantageous position to service existing and new customers' needs in the evolving digital technology landscape.

"The first three months of fiscal 2022 have started well continuing the recent positive trend with extensions of existing contracts and new contract win especially in the Healthcare area and we look forward to another strong performance in 2022.

"During what has been an unprecedented year, we remained in close discussions with our clients to ensure that we meet their needs and requirements throughout, while supporting our staff to work safely and remotely as per government guidelines. I am proud of the way the team has delivered an uninterrupted service to clients with maximum efficiency across all our services. 

"With iEnergizer's solid foundation, proven strength in operational execution, new sales initiatives, differentiated offerings, healthy balance sheet, and with substantial opportunities for further growth identified, the Board is confident in the Company's continued growth path as a unique, end-to-end digital solution enabler."

-Ends-

Enquiries:
iEnergizer Ltd.	[phone]
Chris de Putron
Mark De La Rue
FTI Consulting - Communications adviser	[phone]
James Styles / Eleanor Purdon
Arden Partners-Nominated adviser and broker	[phone]
Steve Douglas / Antonio Bossi (Corporate Finance) James Reed-Daunter (Equity Sales)

Company Overview

iEnergizer is an AIM listed, independent, integrated software and service pioneer. The Company is a publishing and technology leader, which is set to benefit from the dual disruptive waves of big data and the cloud in the digital age. With its expertise and cutting-edge technology, iEnergizer is uniquely positioned to facilitate the transformation to a digital world and support clients in this transition.

iEnergizer provides services across the entire customer lifecycle and offers a comprehensive suite of Content & Publishing Process Outsourcing Solutions (Content Services) and Customer Management Services (Business Process Outsource) that include Transaction Processing, customer acquisition, customer care, technical support, billing & collections, dispute handling, off the shelf courseware, and market research & analytics using various platforms including voice - inbound and outbound, back-office support, online chat, mail room and other business support services.

Our award-winning content and publishing services provide complete, end-to-end solutions for information providers and all businesses involved in content production. Our differentiation is in focusing on solutions and services that enable customers to find new ways to monetize their content assets, measurably improve performance, and increase revenues across their entire operation. From digital product conception, content creation and multichannel distribution, to post-delivery customer and IT support, we align ourselves with our customers as they streamline their operations to maximize cost-efficiencies and improve their ROI while connecting them with new, digitally savvy audiences.

Chairman's Statement

The financial performance of iEnergizer in fiscal 2021 reflects the outcome of continued volume growth from existing key customer relationships, acquiring new customers across all verticals, which together with the adoption of new technology, resulted in 1.8% growth in the Group's Profit Before Taxation (PBT) despite the challenges faced due to the ongoing COVID-19 pandemic impacting several industries across the globe. Our strategy, focused on offering differentiated end-to-end services, supports long-term value creation for our shareholders.

The underlying businesses of each division have performed well. The BPO division posted revenue growth of 2.6%, as the division added several new customers in the promising healthcare space in addition to growing wallet shares from its existing International BPO customers and also increased its EBITDA margins from 33.1% to 34.9%. The Content Services division also grew revenue by 2.6% and has increased its EBITDA margins to 27.2% owing to growth in demand for online education and training

The overall outsourcing global market continues to expand, but the functions of outsourcing are changing dramatically. The number of preferred vendors in any given contract is consolidating and the functions outsourced have become increasingly sophisticated. iEnergizer is well positioned to benefit from this trend as an essential long-term-partner that delivers high quality, complex processes. The Company has developed end-to-end Lifecycle Management (LCM) solutions, so that as companies streamline and consolidate their operations, iEnergizer can act as a preferred vendor and single partner to meet all of these needs while providing maximum cost-efficiencies.

Investments in technology and IT infrastructure facilitating a smooth transition to work from home for operations, development and marketing of off the shelf courseware, a diversified client base and robust service offering with recurring revenues, provides us with good visibility and a positive outlook towards future performance.

The Management

Our management team, through their strength of leadership, has helped iEnergizer grow continuously over the last decade supported by a fantastic team of dedicated colleagues across the business. The entrepreneurial approach has been a true asset to the Company and it has enabled us to identify new markets, customers and product lines in addition to providing a consistently high-quality service to our clients.

I would like to thank each and every one of our colleagues for their commitment to iEnergizer.

Marc Vassanelli
Chairman of the Board

Executive Director's Statement

Fiscal 2021 has been a year of strong growth marked by considerable profitability improvements through sustained maintenance of key customer contracts focussing on the existing business, generating revenue from new service lines and customers together with disciplined cost management.  

Financial Overview

Revenues grew to $196.0m (2020: $191.0m) and PBT grew to $53.5m (2020: $52.5m). Growth in profit is primarily on account of growing profitable vendor contracts with key customers supported by effective management of costs across all verticals of the Company.

By service line, the BPO (Business Process Outsource) division posted revenue growth of 2.6%, as key clients, specifically from the Media & Entertainment segments, continued to increase volumes throughout the year, which also compensated for the reduction in revenue from COVID-19 impacted business lines. The top five customers across the BPO division together grew revenues 8.7% over fiscal 2020, reflective of both retaining key clients and growing 'wallet share' within key accounts along with addition of several new clients.

The Content Delivery division posted revenue growth of 2.6% due to increased volumes from key clients and addition of several new clients. The division also grew its EBITDA margins to 27.2%, with management team being able to control operational costs by utilizing resources effectively to achieve productivity gains and cost savings. The Content delivery segment is focusing on: promotion of E-Learning and Digitization services in line with the industry growth expectations; growing by renewing key contracts with existing customers; and entering into profitable contracts with new clients. The Content division has continued to focus on expanding its customer base for new service lines such as SciPris and off-the-shelf courseware services and has also continued to bid for the US Government's digital conversion projects. 

Business Review

We have aligned the Company with emerging market opportunities to provide digital technology and solutions, including an increased demand within the Healthcare and Pharmaceutical sector. 

Volumes processed for key customers continued to increase, without notable additional work-force resource, reflective of the capability to port expertise from one discipline to another and to utilize technology solutions.

We are proud of our service quality, which is evident in a client retention rate of over 90% and it has also benefitted the Company by an increase in the volume of new work generated from existing clients. We continue to up-sell additional services that are, often more complex and at a higher margin. Our direct customers include a number of the world's largest publishers, Fortune 500 corporations and professional service providers.

We have invested in technology across both our segments - allowing generation of increased margins through automation. On the content side, the Company added new customers on its SaaS platform "SciPris" which allows faster and upfront collections for our clients and has focussed on marketing of Off-The-Shelf (OTS) courseware through direct platform, tradeshows and online retail partners; while we continue to develop and add new content; we offer high margin custom content development services as per specific customer requirements. For BPO, we have developed the use of automation tools such as chatbots to allow basic information capture before human intervention is required. This allows a focus of man hours on technical issue resolution, driving client dependence on services.

Our focus is to continue to provide enterprises with an integrated suite of solutions. Our expertise helps companies in any industry to apply digital technology to monetize content, produce valuable new product offerings, and increase revenues across their entire operation.

From digital product conception, content creation and multichannel distribution, to post-delivery customer and IT support, we are positioned to work alongside our customers as they streamline their operations to maximise their cost-efficiencies and improve their ROI while connecting them with the growing number of digitally savvy audiences.

We have continuously worked hard to develop our differentiated offering and advantageous market positioning to keep ahead of our competitors. Healthcare, Online Education and E-Learning related Market opportunities created in recent times are being serviced with a higher degree of focus and these areas are all expected to contribute favourably towards the Company's success.

The Group's outsourcing services remain structured around industry-focused services, across its market segments. The verticals served include: Banking Financial Services and Insurance (BFSI); Publishing; Non-Publishing; Media & Entertainment; Information Technology; Healthcare and Pharmaceuticals.

Dividend

The Board is pleased to announce that on the back of its strong growth and cash generation this year, it is proposing to pay a final dividend of 8.4p per share with dividend record date of 2 July, 2021. The Company Ordinary Shares are expected to go ex-dividend on 1 July, 2021 and the dividend is expected to be paid on 31 July, 2021. 

Outlook

As we look into fiscal 2022 and beyond, we see a sizeable project pipeline, in both enterprise solutions across the Group. These relate to continued development of the course material and Learning Management Systems (LMS) for the Off-The-Shelf (OTS) content service, combined with continued solid momentum in our Business Process Outsource segment.  We expect the business to continue to deliver on its strategy, and we continue to keep a close eye on our costs, as the revised structure and new initiatives continue to take effect in the content delivery segment. The operational leverage in the business model enables us to capitalise substantially on revenue growth opportunities presented in the pipeline.

With a solid foundation, strong operational execution, new sales initiatives, focused differentiated offerings, a healthy balance sheet, and the substantial opportunities identified, the Board has confidence that the Company is well-set on its growth path as a unique, end-to-end digital solution enabler.

Anil Aggarwal
Chief Executive Officer and Executive Director

BOARD AND EXECUTIVE MANAGEMENT

Marc Vassanelli (50) - Chairman

Mr. Vassanelli brings extensive industry knowledge and experience of successfully growing businesses, from established business services (while CFO of ConvergeOne) to media start-ups (during his time as CEO and President of MV3 Ltd). He brings comprehensive expertise in change management, having successfully managed the integration of Equiniti and Xafinity to form Equiniti Group (a $510m+ revenue UK BPO firm). He also led the turnaround of the $1.5bn EMEA region of Marsh (a portfolio company of Marsh & McLennan) ahead of becoming the Marsh EMEA CFO.  Mr. Vassanelli's previous strategic, operational and financial roles spanning private equity, consulting and banking across multiple industries, will bring invaluable insight and knowledge to the iEnergizer Board.  Mr. Vassanelli sits on the audit, remuneration and nomination committees of the Company.

Anil Aggarwal (60) - Chief Executive Officer & Executive Director

Mr. Aggarwal is a first-generation entrepreneur and is the founder and promoter of iEnergizer. He has promoted and managed several successful businesses in various territories including Barker Shoes Limited in the UK. Mr. Aggarwal is primarily responsible for business development, strategy and overall growth for the company.

Ashish Madan (59) - Chief Financial Officer & Executive Director

Mr. Madan is a business development and marketing professional with over 33 years of experience in retail and customer services industry. As a CFO of iEnergizer Ltd, Mr. Madan contributes to all aspects of strategic business development and decision-making. Previously he has held senior positons in the media, publishing, and retail sectors, overseeing public and press relations as well as internal communications and has a long track record operational, marketing and, relationship success.

Christopher de Putron (47) - Non-Executive Director

Mr. de Putron is a financial services professional with over 25 years' experience in the fiduciary and funds industry in both Guernsey and Bermuda. He is the Managing Director of Jupiter Trustees Limited, a Guernsey based independent fiduciary firm and Jupiter Fund Services Limited a Guernsey based independent fund administration company, and a director of Link Market Services (Guernsey) Limited. Previously he has worked at fiduciary companies in both Guernsey and Bermuda including Rothschild, Bank of Bermuda and HSBC. Mr. de Putron has a business economics degree from the University of Wales and is a member of the Society of Trust and Estate Practitioners. Mr. de Putron sits on the audit, remuneration and nomination committees of the Company.

Mark De La Rue (52) - Non-Executive Director

Mr. De La Rue is a Fellow of the Association of Chartered Certified Accounts (ACCA) and a financial services professional with over 28 years' experience in the accounting and fiduciary industries in Guernsey. He is a director of Jupiter Trustees Limited, a Guernsey based independent fiduciary firm and Jupiter Fund Services Limited a Guernsey based independent fund administration company, and a director of Link Market Services (Guernsey) Limited.

DIRECTORS' REPORT

The Directors present their report and the financial statements of iEnergizer Limited ("the Company") and its Subsidiaries (collectively the "Group"), which covers the year from 1 April 2020 to 31 March 2021.

Principal activity and review of the business

The principal activity of the Company is that of providing Content Transformation Services and Business Process Outsourcing Services.

Results and dividends

The trading results for the year and the Group's financial position at the end of the year are shown in the attached financial statements. The Directors have recommended payment of a dividend of 8.4p per share for a total dividend of 14.12p for the year (FY2020 13.6p).

Review of business and future developments

A review of the business and expected future developments of the Company are contained in the Chairman's statement attached to this report.

Directors and Directors' interests
The Directors of the Company during the year are attached to this report.

Director's remuneration
The Director's remuneration for the year ended 31 March 2021 was:

Particulars	31 March 2021	31 March 2020
Transactions during the year
Remuneration paid to directors	$	$
Chris de Putron	13,086	12,639
Mark De La Rue	13,086	12,639
Marc Vassanelli	39,636	37,917
Anil Aggarwal	--	--
Ashish Madan	--	--

Directors share option

During the year ended 31 March 2021, no key management personnel have exercised options granted to them.

Related party contract of significance
The related party transactions are noted in note 28 of the financial statement.

Internal control

The Directors acknowledge their responsibility for the Company's system of internal control and for reviewing its effectiveness. The system of internal control is designed to manage the risk of failure to achieve the Company's strategic objectives. It cannot totally eliminate the risk of failure but will provide reasonable, although not absolute, assurance against material misstatement or loss.

Going concern

After making enquiries, the Directors have a reasonable expectation that the Company will have adequate resources to continue in operational existence for the foreseeable future. For this reason, they continue to adopt the going concern basis in preparing the financial statements.

Directors' responsibilities

The Directors are responsible for preparing the Directors' reports and consolidated financial statements for each financial year, which give a true and fair view of the state of affairs of the Group and of the profit or loss of the Group for that year. In preparing those financial statements the Directors are required to:

●	Select suitable accounting policies and apply them consistently;
●	Make judgments and estimates that are reasonable and prudent;
●	State whether International Financial Reporting Standards have been followed subject to any material departures disclosed and explained in the financial statements; and
●	Prepare consolidated financial statements on a going concern basis unless it is inappropriate to presume that the Group will continue in business.

The Directors confirm that the financial statements comply with the above requirements.

The Directors are responsible for keeping proper accounting records, which disclose with reasonable accuracy at any time, the financial position of the Company and of the Group to enable them to ensure that the financial statements comply with the requirements of the Companies (Guernsey) Law, 2008. They are also responsible for safeguarding the assets of the Company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

The Directors are responsible for the maintenance and integrity of the corporate and financial information included on the Group's website.

Legislation in Guernsey governing the preparation and dissemination of financial statements may differ from legislation in other jurisdictions.

To the best of our knowledge and belief:

●	The financial statements have been prepared in accordance with International Financial Reporting Standards;
●	The financial statements give a true and fair view of the financial position and results of the Group;

Auditors

All of the current Directors have taken all the steps that they ought to have taken to make themselves, aware of any information needed by the Company's Auditors for the purposes of their audit and to establish that the Auditors are aware of that information. The Directors are not aware of any relevant audit information of which the Auditors are unaware.

On behalf of the board

_______________________________

Director

CORPORATE GOVERNANCE
 

The Directors recognise the importance of good corporate governance and have chosen to apply the Quoted Companies Alliance Corporate Governance Code (the 'QCA Code'). The QCA Code was developed by the QCA in consultation with a number of significant institutional small company investors, as an alternative corporate governance code applicable to AIM companies. The underlying principle of the QCA Code is that "the purpose of good corporate governance is to ensure that the company is managed in an efficient, effective and entrepreneurial manner for the benefit of all shareholders over the longer term". Statement of Compliance with the QCA Corporate Governance Code is provided as a separate section under AIM Rule 26 on company website www.ienergizer.com .

Board of Directors

The Board is responsible for formulating, reviewing and approving the Company strategy, budgets and corporate actions. Following Admission, the Directors intend to hold Board meetings at least bi-annually and at such other times as they deem necessary. The Board comprises of two Executive Directors, Anil Aggarwal and Ashish Madan, and three Non-Executive Directors, Chris de Putron, Mark De La Rue and Marc Vassanelli (Chairman).  The resume of the board members is as outlined in the statement attached to this report. 

The Executive Directors brings knowledge of the Business Process Outsourcing industry, the investment industry and a range of general business skills. The Non-Executive Directors form a number of committees to assist in the governance of the Company. Details are below. 

All Directors have access to independent professional advice, at the Company's expense, if and when required.

Sub-Committees
The Board has appointed the three sub-committees outlined below. The sub-committees will meet at least once each year.

Audit Committee

The Audit committee comprises of Marc Vassanelli as chairman and Chris de Putron.  The committee is responsible for ensuring that the financial performance of the Company is properly monitored and reported on. The committee is also responsible for meeting with the auditors and reviewing findings of the audit with the external auditor. It is authorised to seek any information it properly requires from any employee and may ask questions of any employee. It will meet the auditors once per year, without any member of management being present and is also responsible for considering and making recommendations regarding the identity and remuneration of such auditors.

Remuneration Committee

The Remuneration committee comprises of Marc Vassanelli as chairman and Chris de Putron. The committee will consider and recommend to the Board the framework for the remuneration of the executive directors of the Company and any other senior management. It will further consider and recommend to the Board the total individual package of each executive director including bonuses, incentive payments and share options or other share awards. In addition, subject to existing contractual obligations, it will review the design of all share incentive plans for approval by the Board and the Company's shareholders and, for each such plan, will recommend whether awards are made and, if so, the overall amount of such awards, the individual awards to executive directors and performance targets to be used. No director will be involved in decisions concerning his own remuneration.

Nomination Committee

The Nomination committee comprises Chris de Putron as chairman and Marc Vassanelli. The committee will consider the selection and re-appointment of Directors. It will identify and nominate candidates to all board vacancies and will regularly review the structure, size and composition of the board (including the skills, knowledge and experience) and will make recommendations to the Board with regard to any changes.

Share Dealing

The Company has adopted a share dealing code (based on the Model Code), and the Company will take all proper and reasonable steps to ensure compliance by Directors and relevant employees.

The City Code on Takeovers and Mergers

The Code applies to offers for all listed and unlisted public companies considered by the Panel resident in the UK, the Channel Islands or the Isle of Man. The Panel will normally consider a company to be resident only if it is incorporated in the United Kingdom, the Channel Islands or the Isle of Man and has its place of central management in one of those jurisdictions. Although the Company is incorporated in Guernsey and its place of management is in Guernsey, the Panel considers that the code does not apply to the Company. It is emphasised that although the Ordinary Shares will trade on AIM, the company will not be subject to takeover regulations in the UK; however, certain provisions analogous to parts of the Code in particular the making of mandatory offers have been incorporated into the Articles, which are available on the Company website, www.ienergizer.com .

Disclosure and Transparency Rules

Majority Shareholdings:

The following persons are directly or indirectly interested (within the mean of Part VI of FSMA and DTR5) in three percent or more of the issued share capital of iEnergizer:

Name	# of Ordinary Shares	% of Issued Share Capital
EICR (Cyprus) Limited	157,196,152	82.68
AXA Investment Managers U.K	12,253,034	6.44
Miton Asset Mgt	6,232,750	3.28

Control by Significant Shareholder

Mr. Anil Aggarwal, through private companies-mainly Geophysical Substrata Ltd. (GSL) and EICR (Cyprus) Limited (EICR), owns a significant percentage of the Company.  Mr. Aggarwal could exercise significant influence over certain corporate governance matters requiring shareholder approval, including the election of directors and the approval of significant corporate transactions and other transactions requiring a majority vote. Also, Mr Aggarwal holds ultimate Control over the company.

The Company, Arden Partners (Broker & Nomad), GSL, EICR and Mr. Anil Aggarwal have entered into a relationship agreement to regulate the arrangements between them. The relationship agreement applies for as long as GSL/EICR directly or indirectly holds in excess of thirty per cent of the issued share capital of the Company and the Company's shares remain admitted to trading on AIM. The relationship agreement includes provisions to ensure that:

i.  the Board and its committees are able to carry on their business independently of the individual interests of EICR;

ii.  the constitutional documents of the Company are not changed in such a way which would be inconsistent with the Relationship Agreement;

iii.  all transactions between the Group and EICR (or its affiliates) are on a normal commercial basis and concluded at arm's length;

iv.  EICR shall not:

(i) exercise the voting rights attaching to its Ordinary Shares; or

(ii) procure that the voting rights attaching to its Ordinary Shares be exercised,

so as (a) to appoint any person who is connected to EICR to the Board if, as a direct consequence of such appointment, the number of persons connected to EICR appointed to the Board would exceed the number of independent Directors appointed to the Board, unless such appointment(s) has been previously approved by the nomination committee of the Board constituted by a majority of independent Directors; or (b) to remove any independent Director from the Board, unless such removal has previously been recommended by a majority of the independent Directors, excluding the independent Director in question; or (c) to cancel the Admission, unless the cancellation has previously been recommended by a majority of the independent Directors; and

v.  certain restrictions are put in place to prevent interference by the Shareholder with the business of the Company.

 

Independent auditor's report to the members of iEnergizer Limited

Opinion

Our opinion on the financial statements is unmodified

We have audited the Group financial statements of iEnergizer Limited for the year ended 31 March 2021 which comprise the Consolidated Statement of Financial Position, the Consolidated Income Statement, the Consolidated Statement of Comprehensive Income, the Consolidated Statement of Changes in Equity and the Consolidated Statement of Cash Flows   and notes to the financial statements, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and International Financial Reporting Standards (IFRSs) as adopted by the European Union.  

In our opinion, the financial statements:

· give a true and fair view of the state of the Group's affairs as at 31 March 2021 and of the Group's profit for the year then ended;

· are in accordance with IFRSs as adopted by the European Union; and

· comply with The Companies (Guernsey) Law, 2008.

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs UK)) and applicable law. Our responsibilities under those standards are further described in the 'Auditor's responsibilities for the audit of the financial statements' section of our report. We are independent of the Group in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC's Ethical Standard as applied to listed entities, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Conclusions relating to going concern

We are responsible for concluding on the appropriateness of the directors' use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Group's ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify the auditor's opinion. Our conclusions are based on the audit evidence obtained up to the date of our report. However, future events or conditions may cause the group to cease to continue as a going concern.

In our evaluation of the directors' conclusions, we considered the inherent risks associated with the Group's business model including effects arising from Covid-19, we assessed and challenged the reasonableness of estimates made by the directors and the related disclosures and analysed how those risks might affect the Group's financial resources or ability to continue operations over the going concern period.

Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the Group's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.

In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate.

The responsibilities of the directors with respect to going concern are described in the 'Responsibilities of directors for the financial statements' section of this report.

http://www.rns-pdf.londonstockexchange.com/rns/9194C_1-2021-6-23.pdf

Click or paste the following link into your web browser to view the PDF document. Refer to page 17 for the relevant chart

Overview of our audit approach · Overall materiality: $2,676,260 , which represents 5% of the Group's profit before taxation; · Key audit matters were identified as  a.  Revenue recognition b.  Employee benefits obligation liabilities are understated c.  Payment to fictitious employees d.  Impairment of goodwill and intangible assets with indefinite useful lives We directed our audit procedures on the basis of materiality of each component in the Group structure, performing a comprehensive audit for material components and analytical procedures for other components.

 

 

 

Key audit matters

 

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the Group financial statements of the current period and include the most significant assessed risks of material misstatement (whether or not due to fraud) that we identified. These matters included those that had the greatest effect on: the overall audit strategy; the allocation of resources in the audit; and directing the efforts of the engagement team. These matters were addressed in the context of our audit of the Group financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.

http://www.rns-pdf.londonstockexchange.com/rns/9194C_1-2021-6-23.pdf

Click or paste the following link into your web browser to view the PDF document. Refer to page 17 for the graphic

In the graph below, we have presented the key audit matters, significant risks and other risks relevant to the audit.

http://www.rns-pdf.londonstockexchange.com/rns/9194C_1-2021-6-23.pdf

Click or paste the following link into your web browser to view the PDF document. Refer to page 17 for the relevant chart

Key Audit Matter - Group	How the matter was addressed in the audit - Group
Revenue recognition Revenue is recognised when the Group satisfies performance obligations by transferring the promised goods or services to its customers. Revenue is the key driver of the business and judgement is involved in determining when contractual obligations have been performed and to the extent that the right to consideration has been earned. There is a risk that revenue may be deliberately overstated as a result of management override resulting from the pressure management may feel to achieve targeted results. The management of the Group focuses on revenue as a key performance measure which could create an incentive for revenue to be recognized before satisfying the performance obligations. We therefore identified revenue recognition as one of the most significant assessed risks of material misstatement and key audit matter. Relevant Disclosures in the Annual Report and Accounts 2021 The Group accounting policy on revenue recognition is shown in note 3.3 and related disclosures are included in note 29	Our audit work included, but was not restricted to: · Obtaining an understanding by performing walkthroughs of each significant class of revenue transactions and assessing the design and implementation of key controls; · Assessing the timing of revenue recognition on a sample basis across revenue streams in accordance with IFRS 15. · Performing an analytical review on revenue recognised to identify any material new revenue streams and customers and to assess whether recognized revenue is in line with the expected level; and Assessing the amount of revenue to customers on a sample basis by agreeing the extent, timing and customer acceptance of goods and services, where relevant Our Results Based on our audit procedures we did not identify any evidence of material misstatement in the revenue recognised for the year ended 31 March 2021 in the Group financial statements.
Employee benefits obligation liabilities are understated The Group has the following defined benefits plans for different geographical entities i.e 1. Gratuity; and 2. Pension Cost The value of the above employee benefit obligations (net of plan assets) amounts to $3,503,562. The valuation of the above plans in accordance with IAS 19 Employee Benefits involves significant judgement and is subject to complex actuarial assumptions. Small variations in those actuarial assumptions can lead to materially different values of the above plans recognised in the Group financial statements. We therefore identified employee benefit obligation as one of the most significant assessed risk of material misstatement, and key audit matters. Relevant Disclosures in the Annual Report and Accounts 2021 Financial Statements: Note 3.9, Post Employment Benefits, Short Term and Long Term Employee Benefits and Employee Costs; Note 18, Employee Benefit Obligations.	Our audit work included, but was not restricted to: · Performing walkthrough of management's process for assessing the valuation of defined benefit plans and other long-term benefits and assessing the design and implementation of key controls; · Testing the accuracy of the underlying data used by the Group actuaries for the purpose of calculating the scheme liabilities by selecting a sample of employees and agreeing pertinent data such as date of birth, gender, date of joining etc. to underlying records; · Testing the reasonableness of assumptions used by the Group actuary for calculation of the scheme liabilities. The Group accounting policy on valuation of defined benefit plan is shown in note 3.9 to the financial statements and related disclosures are included in note 18. Our Results Based on our audit work, we found the valuation methodologies including inherent actuarial assumptions, estimates and potential impact on the future period of revision of these estimates to be reasonable.
Payment to fictitious employees   The Group functions in a sector having high turnover of employees and has significant expenditure in relation to the employee cost. We identified it as one of the most significant assessed risk of material misstatement in relation to payment to fictitious employees and this area was considered to be a key audit matter.	Our audit work included, but was not restricted to: ·   Performing walkthrough of management's process for payment of employee remuneration and assessing the design, effectiveness and implementation of key controls; · Performing an analytical review of employee remuneration to assess whether employee remuneration recorded and payment made are in line with the expected level; and · Assessing the accuracy of employee data by selecting a sample and interviewing them to agree pertinent data including the identification number issued by the government, date of joining and other personal details Our Results Based on our audit work, we did not identify and instances of payment to fictitious employees.
Impairment of goodwill and Intangible Assets with indefinite useful lives The process of assessing whether an impairment exists under International Accounting Standard (IAS) 36 Impairment of Assets is complex. The Group has certain intangible assets having indefinite lives in the form of goodwill arising from business combinations in earlier years, trademarks and patents. Management's evaluation of the carrying value of these assets involves analysis of the Group cash generating units (CGU) which requires judgement about future performance of CGU's and the discount rates applied to future cash flow projections. Therefore, we identified impairment of goodwill and intangible assets with indefinite useful lives as a significant and key audit matter. Relevant Disclosures in the Annual Report and Accounts 2021 Financial Statements: Note 3.5, 3.6, Goodwill and Other Intangible Assets; Note 7, 8, Goodwill and Other Intangible Assets	Our audit work included, but was not restricted to: · Performing walkthrough of management's process for assessing the impairment of goodwill and intangible assets and assessing the design and implementation of key controls; · Testing the methodology applied in calculating value in use, using a valuation specialist to ensure compliance with the requirements of IAS 36, Impairment of Assets; · Testing the mathematical accuracy of management's model and wherein the management sought assistance from external valuer, using a valuation specialist; · Testing the key underlying assumptions for the financial years ending 31 March 2021 and beyond; · Challenging management on its cash flow forecast and the implied growth rates for the FY 2021 and beyond, considering evidence to support these assumptions; · Testing the accuracy of the "discount rates" using comparative Company information, risk free/risk premium market available rate and "long-term growth rates" by corroborating the responses received from management in respect of revenue growth projections; and · Testing the sensitivity analysis performed by management in respect of the key assumptions of discount and growth rates to check sufficient headroom in their calculation. The Group accounting policy on Impairment of goodwill and intangible assets is disclosed in Note 3.5 and 3.6 to the financial statements and related disclosures are included in Note 7. Our Results Based on our work, we found that the assumptions made and estimates used in management's assessment of impairment of goodwill and intangible assets with indefinite useful lives are reasonable. From our audit procedures we found that Note 7 to the financial statements appropriately discloses the assumptions used in arriving at the recoverable amount of CGU.

Our application of materiality

We apply the concept of materiality both in planning and performing the audit, and in evaluating the effect of identified misstatements on the audit and of uncorrected misstatements, if any, on the financial statements and in forming the opinion in the auditor's report.

Materiality was determined as follows:

Materiality measure	Group	Parent company
Materiality for financial statements as a whole	We define materiality as the magnitude of misstatement in the financial statements that, individually or in the aggregate, could reasonably be expected to influence the economic decisions of the users of these financial statements. We use materiality in determining the nature, timing and extent of our audit work.
Materiality threshold	USD 2,676,260 which is 5% of Group Profit before taxes	USD 1,646,389 which is 5% of Parent Company's Profit before taxes
Significant judgements made by auditor in determining the materiality	Profit before tax was considered the most appropriate benchmark because the group operates within the service industry and also uses profit before taxes to measure it's financial performance. Further, the group is having profitable trends over the past years. Materiality for the current year is higher than the level that we determined for the year ended  31 March 2020 to reflect the increase in Revenue.	Profit before tax was considered the most appropriate benchmark because the group operates within the service industry and also uses profit before taxes to measure it's financial performance, Further, the parent is having profitable trends over the past years. Materiality for the current year is higher than the level that we determined for the year ended  31 March 2020 to reflect the increase in Revenue.
Performance materiality used to drive the extent of our testing	We set performance materiality at an amount less than materiality for the financial statements as a whole to reduce to an appropriately low level the probability that the aggregate of uncorrected and undetected misstatements exceeds materiality for the financial statements as a whole.
Performance materiality threshold	USD 1,605,756 which is 60% of Group financial statement materiality.	USD 987,833 which is 60% of Parent financial statement materiality.
Specific materiality	We determine specific materiality for one or more particular classes of transactions, account balances or disclosures for which misstatements of lesser amounts than materiality for the financial statements as a whole could reasonably be expected to influence the economic decisions of users taken on the basis of the financial statements.
Specific materiality threshold	We determined a lower level of specific materiality for all account balances and transactions	We determined a lower level of specific materiality for all account balances and transactions
Communication of misstatements to the audit committee	We determine a threshold for reporting unadjusted differences to the audit committee.
Threshold for communication	USD 1,605,756 and misstatements below that threshold that, in our view, warrant reporting on qualitative grounds.	USD 987,833 and misstatements below that threshold that, in our view, warrant reporting on qualitative grounds.

The graph below illustrates how performance materiality interacts with our overall materiality and the tolerance for potential uncorrected misstatements.

http://www.rns-pdf.londonstockexchange.com/rns/9194C_1-2021-6-23.pdf

Click or paste the following link into your web browser to view the PDF document. Refer to page 22 for the relevant chart

An overview of the scope of our audit

We performed a risk-based audit that requires an understanding of the group's and the parent company's business and in particular included the following areas:

The Engagement Team obtained an understanding of the group and its environment, including group controls, and assessed the risks of material misstatement at the group level. Further, the Engagement Team included the effect of group organisational structure on the scope of the audit.

The identified components of the Group were evaluated by the Group audit team based on a measure of materiality considered as a percentage of total profit before tax to assess the significance of the component and to determine the planned audit response. This benchmark was considered the most appropriate because the group operates within the service industry and also uses profit before taxes to measure it's financial performance. For those components that we determined to be significant, either a full scope approach or specified procedures in relation to specific balances and transactions were carried out. This approach was determined based on their relative materiality to the Group and our assessment of audit risk.

In establishing the overall approach to the Group audit, we determined the type of work that needed to be performed at the reporting units by us, as the Group engagement team, or component auditors within Grant Thornton Limited, Channel Islands, and other network firms operating under our instruction. Where the work was performed by component auditors, we determined the relevant risks for the component, the level of involvement we needed to have in the audit work, issued Group instructions to the component auditor including details of component materiality, and reviewed the workpapers through planning, fieldwork and completion of the identified risk areas to be able to conclude whether sufficient appropriate audit evidence had been obtained as a basis for our opinion on the Group Financial Statements as a whole. Due to the impact of COVID-19, the Group engagement team were unable to travel to the component auditor location in order to carry out the reviews of the work of the component auditor; however, alternative methods were identified in order to obtain sufficient, appropriate audit evidence to support the Group opinion.

The Group's components range in size and activity. To provide sufficient coverage over the Group's key audit matters, we performed full scope audit procedures on the financial information of 5 components, iEnergizer Limited, the parent company located in Guernsey, Aptara Inc. located in United States of America including it's six subsidiaries in India, iEnergizer Aptara Limited and iEnergizer Holdings Limited located in Mauritius, and iEnergizer IT Services Private Limited located in India, which included 100% of total assets, 100% of total profit before tax, 100% of total revenues of the Group respectively. For the significant components requiring full scope audit procedures of their financial information, we carried out an interim audit procedure combined with substantive procedures prior to the year end and to evaluate the components' internal control environment. Our audit testing included substantive procedures of transactions and balances for the year ended 31 March 2021.

Other information

The directors are responsible for the other information. The other information comprises the information included in the annual report set out on pages 1 to 14 , other than the financial statements and our auditor's report thereon. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon.

In connection with our audit of the Group financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether there is a material misstatement of the financial statements or a material misstatement of the other information. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.

We have nothing to report in this regard.

Matters on which we are required to report by exception

We have nothing to report in respect of the following matters in relation to which The Companies (Guernsey) Law, 2008 requires us to report to you if, in our opinion:

●	proper accounting records have not been kept by the Group; or
●	the Group financial statements are not in agreement with the accounting records and returns; or
●	we have not obtained all the information and explanations which, to the best of our knowledge and belief, are necessary for the purposes of our audit.

Responsibilities of directors for the financial statements

As explained more fully in the directors' responsibilities statement set out on page 11, the directors are responsible for the preparation of the Group financial statements which give a true and fair view in accordance with IFRSs, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, the directors are responsible for assessing the Group ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the Group or to cease operations, or have no realistic alternative but to do so.

Auditor's responsibilities for the audit of the financial statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion.

Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council's website at: www.frc.org.uk/auditorsresponsibilities . This description forms part of our auditor's report.

Explanation as to what extent the audit was considered capable of detecting irregularities, including fraud

Identifying and assessing potential risks related to irregularities

In identifying and assessing the risks of material misstatement in respect of irregularities, including fraud and non-compliance with laws and regulations, we considered the following:

a)  The nature of the industry and sector, control environment and business performance including the design of the Group's remuneration policies, key drivers for directors' remuneration, bonus levels and performance targets;

b)  Enquiring of management, internal audit and the Audit & Risk Committee, including obtaining and reviewing supporting documentation, concerning the Group's policies and procedures relating to: Identifying, evaluating and complying with laws and regulations and whether they were aware of any instances of non-compliance;

c)  Detecting and responding to the risks of fraud and whether they have knowledge of any actual, suspected or alleged fraud;

d)  The internal controls established to mitigate risks related to fraud or non-compliance with laws and regulations.

e)  Discussing with component auditors to request identification of any instances of non-compliance with laws and regulations that could give rise to a material misstatement of the group financial statements.

f)   Discussing among the engagement team including significant component audit teams and involving relevant internal specialists, including tax, valuations, and Information Technology specialists regarding how and where fraud might occur in the financial statements and any potential indicators of fraud; and;

g)  Obtaining an understanding of the legal and regulatory frameworks that the Group operates in, focusing on those laws and regulations that had a direct effect on the financial statements, such as Guernsey Law.

Audit response to risks identified

As a result of performing the above, we identified the Revenue Recognition and Payment to Ficticious Employees as a key audit matter related to the potential risk of fraud. The key audit matters section of our report explains the matter in more detail and also describes the specific procedures in response to that key audit matter. In common with all audits under ISAs (UK), we are also required to perform specific procedures to respond to the risk of management override of controls

In addition to the above, our procedures to respond to risks identified included the following:

a) Reviewing the financial statement disclosures and testing to supporting documentation to assess compliance with provisions of relevant laws and regulations described as having a direct effect on the financial statements;

b)  Enquiring of management, the Audit & Risk Committee and in-house and external legal counsel concerning actual and potential litigation and claims;

c)   Performing analytical procedures to identify any unusual or unexpected relationships that may indicate risks of material misstatement due to fraud; and

d)  Reading minutes of meetings of those charged with governance, reviewing internal audit reports and correspondence with regulators.

e)  In addressing the risk of fraud through management override of controls, testing the appropriateness of journal entries and other adjustments; assessing whether the judgements made in making accounting estimates are indicative of a potential bias; and evaluating the business rationale of any significant transactions that are unusual or outside the normal course of business.

We also communicated relevant identified laws and regulations and potential fraud risks to all engagement team members and significant component audit teams, and remained alert to any indications of fraud or non-compliance with laws and regulations throughout the audit. 

Use of our report

This report is made solely to the Parent Company's members, as a body, in accordance with Section 262 of The Companies (Guernsey) Law, 2008. Our audit work has been undertaken so that we might state to the Parent Company's members those matters we are required to state to them in an auditor's report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the Parent Company and the Parent Company's members as a body, for our audit work, for this report, or for the opinions we have formed.

Michael Carpenter

For and on behalf of Grant Thornton Limited

Chartered Accountants

St Peter Port, Guernsey, Channels Islands

Date: 23 June 2021

Consolidated Statement of Financial Position

 (All amounts in United States Dollars, unless otherwise stated)

	Notes	As at 31 March 2021	As at 31 March 2020
ASSETS
Non-current
Goodwill	7	102,250,365	102,248,030
Other intangible assets	8	12,573,227	12,557,319
Right to use asset	25	4,719,671	5,303,271
Property, plant and equipment	9	6,608,441	7,142,700
Long- term financial asset	10	3,311,739	3,351,981
Non-current tax assets		262,166	1,238,883
Deferred tax asset	11	3,469,843	3,623,361
Other non current assets		23,909	21,047
Non-current assets		133,219,361	135,486,592
Current
Trade and other receivables	12	33,893,763	32,044,127
Cash and cash equivalents	13	51,378,899	45,147,783
Short- term financial assets	14	16,281,924	7,642,641
Current tax assets		-	211,055
Other current assets	15	3,562,881	2,589,023
Current assets		105,117,467	87,634,629
Total assets		238,336,828	223,121,221
EQUITY AND LIABILITIES
Equity
Share capital	27	3,776,175	3,776,175
Share compensation reserve	3.15	63,986	63,986
Additional paid in capital	3.15	15,451,809	15,451,809
Merger reserve	3.15	(1,049,386)	(1,049,386)
Retained earnings	3.15	26,482,815	139,677,678
Other components of equity	3.15	(15,136,936)	(17,320,281)
Total equity attributable to equity holders of the parent		29,588,463	140,599,981

	Notes	As at 31 March 2021	As at 31 March 2020
Liabilities
Non-current
Long term borrowings	16	142,905,717	32,992,983
Employee benefit obligations	18	4,708,447	4,667,061
Deferred tax liability	11	8,929,659	9,717,709
Non-current liabilities		156,543,823	47,377,753
Current
Trade and other payables	17	12,929,316	11,481,885
Employee benefit obligations	18	959,887	810,614
Current tax liabilities		393,028	-
Current portion of long term borrowings	16	24,403,033	10,527,775
Other current liabilities	19	13,519,278	12,323,213
Current liabilities		52,204,542	35,143,487
Total equity and liabilities		238,336,828	223,121,221

(The accompanying notes are an integral part of the Consolidated Financial Statements)

The Consolidated Financial Statements have been approved and authorized for issue by the Board of Directors on 23 June 2021.

Director

Consolidated Income Statement

(All amounts in United States Dollars, unless otherwise stated)

	Notes	For the year ended 31 March 2021	For the year ended 31 March 2020
Income from operations
Revenue from services		195,964,336	191,000,491
Other operating income	20	4,364,491	3,881,528
		200,328,827	194,882,019
Cost and expenses
Outsourced service cost	3.18	38,108,886	40,309,556
Employee benefits expense		76,951,595	79,247,043
Depreciation and amortisation		5,158,089	4,476,820
Other expenses		22,513,371	14,711,086
		142,731,941	138,744,505
Operating profit		57,596,886	56,137,514
Finance income	21	1,175,923	861,314
Finance cost	22	(5,247,613)	(4,444,444)
Profit before tax		53,525,196	52,554,384
Income tax expense	23	4,588,913	7,532,216
Profit for the year attributable to equity holders of the parent		48,936,283	45,022,168
Earnings per share	24
Basic		0.26	0.24
Diluted		0.26	0.24
Par value of each share in GBP		0.01	0.01

(The accompanying notes are an integral part of the Consolidated Financial Statements)

Consolidated Statement of Comprehensive Income

(All amounts in United States Dollars, unless otherwise stated)

	For the year ended 31 March 2021	For the year ended 31 March 2020
Profit after tax for the year	48,936,283	45,022,168
Other comprehensive income
Items that will be reclassified subsequently to the consolidated income statement
Exchange differences on translating foreign operations	2,141,313	(5,559,767)
Net other comprehensive income/(loss) that will be reclassified subsequently to consolidated income statement	2,141,313	(5,559,767)
Items that will not be reclassified subsequently to income statement
Remeasurement of the net defined benefit liability	56,169	(128,440)
Income tax relating to items that will not be reclassified	(14,137)	37,738
Net other comprehensive income/(loss) that will be not be reclassified subsequently to consolidated income statement	42,032	(90,702)
Other comprehensive income/(loss) for the year	2,183,345	(5,650,469)
Total comprehensive income attributable to equity holders	51,119,628	39,371,699

(The accompanying notes are an integral part of the Consolidated Financial Statements) Consolidated Statement of Changes in Equity

(All amounts in United States Dollars, unless otherwise stated)

	Share capital	Additional Paid in Capital	Share compensation reserve	Merger reserve	Other components of equity		Retained earnings	Total equity
					Foreign currency translation reserve	Net defined benefit Liability
Balance as at 1 April 2020	3,776,175	15,451,809	63,986	(1,049,386)	(18,007,911)	687,630	139,677,678	140,599,981
Dividends	-	-	-	-	-	-	(162,131,146)	(162,131,146)
Transaction with owners	-	-	-	-	-	-	(162,131,146)	(162,131,146)
Profit for the year	-	-	-	-	-	-	48,936,283	48,936,283
Other comprehensive loss	-	-	-	-	2,141,313	42,032	-	2,183,345
Total comprehensive income for the period	-	-	-	-	2,141,313	42,032	48,936,283	51,119,628
Balance as at 31 March 2021	3,776,175	15,451,809	63,986	(1,049,386)	(15,866,598)	729,662	26,482,815	29,588,463

(The accompanying notes are an integral part of the Consolidated Financial Statements)  

Consolidated Statement of Changes in Equity

 (All amounts in United States Dollars, unless otherwise stated)

	Share capital	Additional paid-in-capital	Share compensation reserve	Merger reserve	Other components of equity		Retained earnings	Total equity
					Foreign currency translation reserve	Net defined  benefit  liability
Balance as at 1 April 2019	3,776,175	15,451,809	63,986	(1,049,386)	(12,448,144)	778,332	131,950,337	138,523,109
Dividends	-	-	-	-	-	-	(37,294,827)	(37,294,827)
Transaction with owners	-	-	-	-	-	-	(37,294,827)	(37,294,827)
Profit for the year	-	-	-	-	-	-	45,022,168	45,022,168
Other comprehensive loss	-	-	-	-	(5,559,767)	(90,702)	-	(5,650,469)
Total comprehensive income for the period	-	-	-	-	(5,559,767)	(90,702)	45,022,168	39,371,699
Balance as at 31 March 2020	3,776,175	15,451,809	63,986	(1,049,386)	(18,007,911)	687,630	139,677,678	140,599,981

(The accompanying notes are an integral part of the Consolidated Financial Statements)

 

Consolidated Statement of Cash Flows

(All amounts in United States Dollars, unless otherwise stated)  

	For the year ended 31 March 2021	For the year ended 31 March 2020
(A) Cash flow from operating activities
Profit before tax	53,525,196	52,554,384
Adjustments
Depreciation and amortisation	5,158,089	4,476,820
Loss/(Profit) on disposal of property, plant and equipment	1,040	(10,494)
Trade receivables written-off/provision for doubtful debts	3,919,116	1,585,399
Provision for doubtful debts written back	(1,227,481)	(809,227)
Sundry balances written back	(3,587)	(2,090)
Unrealised foreign exchange gain	(143,426)	(1,619,967)
Finance income	(1,175,923)	(861,314)
Finance cost	4,577,051	3,876,410
Interest cost on lease liability	529,756	568,034
Other borrowing cost at Amortised Cost	140,806	-
	65,300,637	59,757,955
Changes in operating assets and liabilities
(Increase)/ Decrease in trade and other receivables	(1,185,494)	3,171,187
(Increase)/ Decrease in other assets (current and non-current)	(131,833)	582,094
Increase in non-current liabilities, trade payables & other current liabilities	275,462	1,426,389
Increase in employee benefit obligations	132,739	87,848
Cash generated from operations	64,391,511	65,025,473
Income taxes paid	(3,656,783)	(5,097,865)
Net cash generated from operating activities	60,734,728	59,927,608
(B) Cash flow for investing activities
Payments for purchase of property plant and equipment	(2,343,683)	(3,602,218)
Redemption of fixed deposit	4,788,393	2,658,771
Investment in fixed deposit	(12,900,755)	(5,595,675)
Proceeds from disposal of property, plant & equipment	55,401	9,572
Payments for purchase of other intangible assets	(512,302)	(740,711)
Interest received	1,126,809	892,949
Net cash used in investing activities	(9,786,137)	(6,377,312)
(C ) Cash flow from financing activities
Interest paid	(4,577,051)	(4,390,603)
Dividends paid to equity holders of the parent	(162,131,146)	(37,294,827)
Repayment of borrowings and lease liability	(43,067,804)	(11,371,909)
Proceeds from borrowings and lease liability	165,175,315	1,672,657
Net cash used in financing activities	(44,600,686)	(51,384,682)
Net increase in cash and cash equivalents	6,347,906	2,165,614
Cash and cash equivalents at the beginning of the year	45,147,783	42,404,281
Effect of exchange rate changes on cash	(116,790)	577,888
Cash and cash equivalents at the end of the year	51,378,899	45,147,783
Cash and cash equivalents comprise
Cash in hand	9,637	20,190
Balances with banks in current account	51,369,262	43,525,802
Remittance in transit	-	1,601,791
	51,378,899	45,147,783

*RECONCILIATION OF LIABILITIES ARISING FROM FINANCING ACTIVITIES

The changes in the Group's liabilities arising from financing activities can be classified as follows:

	Long-term borrowings (including current portion of long-term borrowing)	Short-term borrowings	Lease Liabilities	Total
1 April 2020	37,837,207	-	5,683,551	43,520,758
Adoption of IFRS 16	-	-	-	-
Cash-flows:
Repayment	(41,036,277)	-	(2,031,527)	(43,067,804)
Proceeds	165,175,315	-	-	165,175,315
Non-cash:
Additional lease liability	-	-	1,009,919	1,009,919
Interest on lease liability	-	-	529,756	529,756
Other borrowing cost at amortised cost	140,806	-	-	140,806
31 March 2021	162,117,051	-	5,191,699	167,308,750
1 April 2019	46,222,538	8,934	51,493	46,282,965
Adoption of IFRS 16	-	-	6,369,011	6,369,011
Cash-flows:
Repayment	(9,478,373)	(8,934)	(1,884,602)	(11,371,909)
Proceeds	1,093,042	-	-	1,093,042
Non-cash:
Additional lease liability	-	-	579,615	579,615
Interest on lease liability	-	-	568,034	568,034
31 March 2020	37,837,207	-	5,683,551	43,520,758

 (The accompanying notes are an integral part of these the Consolidated Financial Statements)

 

Notes to the Consolidated Financial Statements

(All amounts in United States Dollars, unless otherwise stated)

1.  INTRODUCTION

iEnergizer Limited (the 'Company' or 'iEnergizer') was incorporated in Guernsey on 12 May 2010. It is a 'Company limited by shares' and is domiciled in Guernsey. The registered office of the Company is located at Mont Crevelt House, Bulwer Avenue, St. Sampson, Guernsey, GY2 4 LH. iEnergizer was listed on the Alternative Investment Market ('AIM') of the London Stock Exchange on 14 September 2010.

iEnergizer through its subsidiaries iEnergizer Holdings Limited, iEnergizer IT Services Private Limited, iEnergizer BPO Inc., iEnergizer Management Services Limited, iEnergizer BPO Limited, iEnergizer Aptara Limited and Aptara Inc., Techbooks International Private Limited, Techbooks Electronic Services Private Limited, Global Content Transformation Private Limited, Aptara Learning Private Limited, Aptara New Media Private Limited and Aptara Technologies Private Limited is engaged in the business of call centre operations, providing business process outsourcing (BPO) and content delivery services to their customers, who are primarily based in the United States of America and India, from its operating offices in United States of America, Mauritius and India.

2.  GENERAL INFORMATION AND STATEMENT OF COMPLIANCE WITH IFRS

The consolidated financial statements of the Group for the year ended 31 March 2021 have been prepared in accordance with International Financial Reporting Standards (IFRS) as adopted by European Union (EU) under the historical cost convention on the accrual basis except for certain financial instruments and some of the employee benefits which are as per IFRS 9 and IAS 19, being measured at fair values.

The significant accounting policies that have been used in the preparation of these consolidated financial statements are summarized below. The consolidated financial statements have been prepared on a going concern basis.

3.  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

3.1  BASIS OF CONSOLIDATION

The Group's consolidated financial statements include financial statements of iEnergizer Limited, the parent company and all of its subsidiaries for the year ended 31 March 2021. Subsidiaries are entities over which the Group has the power to control. Control exists when the parent has the power to control the financial and operating policies of the entity, is exposed, or has rights, to variable returns from its involvement with the entity and has the ability to affect those returns by using its power over the entity. iEnergizer obtains and exercises control through more than half of the voting rights of the entity.

All intra-group balances, transactions, income and expenses including unrealized income or expenses are eliminated in full on consolidation. Amounts reported in the financial statements of subsidiaries have been adjusted where necessary to ensure consistency with the accounting policies adopted by the Group.

3.2  FOREIGN CURRENCY TRANSLATION

These consolidated financial statements are presented in USD ('United States Dollar'), which is also the Company's functional currency. Each entity in the Group determines its functional currency and items included in the financial statement of each entity are measured using that functional currency. The functional currency of each entity has been determined based on the primary economic environment in which each entity of the Group operates.

a.  Transactions and balances

Transactions in foreign currencies are initially recorded by the Group entities at their respective functional currency rates prevailing at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies are translated at the functional currency spot rate of exchange ruling at the reporting date and the resultant foreign exchange gain or loss on re-measurement of monetary item or settlement of such transactions are recognized in the consolidated income statement.

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

b.  Group companies

In the Group's consolidated financial statements, all assets, liabilities and transactions of Group entities with a functional currency other than USD (the Group's presentation currency) are translated into USD upon consolidation. The functional currencies of the entities in the Group have remained unchanged during the reporting period.

The assets and liabilities of foreign operations are translated into USD at the rate of exchange prevailing at the reporting date and their consolidated statements of comprehensive income are translated at average exchange rates where this is a reasonable approximation to actual rates during the year. The exchange differences arising on the translation are recognized in other comprehensive income. On disposal of a foreign operation, the component of other comprehensive income relating to that particular foreign operation is recognized in the consolidated income statement. Goodwill and fair value adjustments arising on the acquisition of a foreign entity have been treated as assets and liabilities of the foreign entity and translated into USD at the closing rate.

3.3  REVENUE RECOGNITION

IFRS 15 provides a control-based revenue recognition model and to determine whether to recognize revenue, the Group follows a 5-step process:

1)  Identification of the contracts with the customer

2)  Identification of the performance obligations in the contract

3)  Determination of the transaction price

4)  Allocation of the transaction price to performance obligations in the contract (as identified in step ii)

5)  Recognition of revenue when a performance obligation is satisfied.

Revenue is recognised either at a point in time or over time, when (or as) the Group satisfies performance obligations by transferring the promised goods or services to its customers. The Group recognises contract liabilities for consideration received in respect of unsatisfied performance obligations and reports these amounts as other liabilities in the statement of financial position. Similarly, if the Group satisfies a performance obligation before it receives the consideration, the Group recognises either a contract asset or a receivable in its statement of financial position, depending on whether something other than the passage of time is required before the consideration is due.

Revenue is measured at transaction price which is the amount of consideration to which the Group expects to be entitled in exchange for transferring promised goods or services to a customer, excluding amounts collected on behalf of third parties (for example, taxes or duties). 

Rendering of services

Revenue comprises revenue from business process outsourcing and also content delivery services. These services are rendered through contractual arrangements entered into with customers by the Group companies.

Revenue from business process outsourcing includes transaction processing,   customer care, technical support, billing and collections, dispute handling, off the shelf courseware , KYC services, and market research and analytics in which revenue is recognised on the basis of number of hours or days services have been rendered as the customer simultaneously receives and consumes the benefits provided by the Group performance obligation, therefore revenue is being recognized over the time basis. Customers are invoiced on the monthly basis.

In respect of Content delivery services segment, it majorly includes content process outsourcing solutions, digital product conception, content creation, multichannel distribution, post-delivery customer service and IT support. All these are primarily on a fixed price contract on which revenue is recognised only upon full satisfaction of the performance obligation, deemed to be acceptance by the customers and transfer of control, therefore, the Group recognises revenue using point in time.

Further, in respect of content delivery services segment which are generally a fixed price contract, where, in respect of few customers who are eligible for rebate based on the agreement entered with them. For these contacts, variable amount of consideration is estimated. The Group calculates this estimation using expected value method in which the sum of probability-weighted amounts in a range of possible consideration is taken. Therefore, revenue and trade receivable are recognised net of rebate amount.

Finance income

Finance income consists of interest income on funds invested. Finance income is recognized as it accrues in the consolidated income statement, using the effective interest rate method.

3.4  PROPERTY, PLANT AND EQUIPMENT

Items of plant and equipment are stated at cost, net of accumulated depreciation and/or accumulated impairment losses, if any. Such cost includes the cost of replacing part of the plant and equipment and borrowing costs for long- term construction projects if the recognition criteria are met. When significant parts of property, plant and equipment are required to be replaced in intervals, the Group recognizes such parts as individual assets with specific useful lives and depreciation, respectively. Likewise, when a major inspection is performed, its cost is recognized in the carrying amount of the plant and equipment as a replacement if the recognition criteria are satisfied. All other repair and maintenance costs are recognized in the consolidated income statement as incurred.

Assets acquired under finance leases are capitalized as assets by the Group at the lower of the fair value of the leased property or the present value of the related lease payments or where applicable, the estimated fair value of such assets at the inception of the lease. Leased assets are depreciated over the useful life of the asset. However, if there is no reasonable certainty that the Group will obtain ownership by the end of the lease term, the asset is depreciated over the shorter of the estimated useful life of the asset and the lease term.

Depreciation is calculated on a straight-line basis over the estimated useful life of the asset as follows:

Asset	Useful Life
Computers and data equipment	1 to 6 years
Office equipment	5 years
Furniture and fixtures	10 years
Plant and machinery	6 to15 years
Air conditioners and generators	6 to15 years
Vehicles	8 to 10 years

Leasehold improvements are depreciated over the useful life of the asset. However, if there is no reasonable certainty that the Group will obtain ownership of the leased asset by the end of the lease term, the asset is depreciated over the shorter of the estimated useful life of the asset and the lease term.

An item of property, plant and equipment and any significant part initially recognized is de-recognized upon disposal or when no future economic benefits are expected from its use or disposal. Any gain or loss arising on de-recognition of the asset (calculated as the difference between the net disposal proceeds and the carrying amount of the asset) is included in the consolidated income statement when the asset is de-recognized.

The assets' useful lives and methods of depreciation are reviewed at each financial year-end, and adjusted prospectively, if appropriate.

Advances paid for the acquisition of property, plant and equipment outstanding at the end of the reporting period and the cost of property, plant and equipment not put to use before such date are disclosed as 'Capital work-in-progress'.

3.5  GOODWILL

Goodwill represents the future economic benefits arising from a business combination that are not individually identified and separately recognized. Goodwill is carried at cost less accumulated impairment losses. The impairment analysis of goodwill is carried out annually at the cash generating unit (CGU) level to evaluate whether events or changes have occurred that would suggest an impairment of carrying value.

3.6  OTHER INTANGIBLE ASSETS

Intangible assets acquired separately are measured on initial recognition at cost. The cost of intangible assets acquired in a business combination is initially recorded at its fair value as at the date of acquisition. Following initial recognition, intangible assets are carried at cost less any accumulated amortization and any accumulated impairment losses.

Intangible assets are amortised over their useful economic life on a straight-line basis and assessed for impairment whenever there is an indication that the intangible asset may be impaired. Intangibles with finite useful lives are amortized on a straight-line basis. The amortisation period and the amortization method for an intangible asset are reviewed at least at each financial year end. Changes in the expected useful life or the expected pattern of consumption of future economic benefits embodied in the asset are accounted for by changing the amortization period or method, as appropriate, and are treated as changes in accounting estimates.

Gains or losses arising from the de-recognition of an intangible asset are measured as the difference between the net disposal proceeds and the carrying amount of the asset and are recognized in the consolidated income statement when the asset is de-recognized.

Useful lives are reviewed at each reporting date. Further, intangibles with indefinite useful lives are subject to impairment testing annually. Amortization has been included within 'depreciation and amortization'. The following useful lives are applied:

• Software: 2-5 years

• Customer contracts and relationships: 2-7 years

• Trademark and patents (having indefinite life): Tested for impairment annually

• Right-of-use asset: refer note 3.7

3.7  LEASES

The Group has applied IFRS 16 with effect from 1 April 2019. The group is using the transition methodology provided in para C5(b) of IFRS 16 ("the modified retrospective approach"), by measuring the asset at an amount equal to the lease liability, adjusted by the amount of any prepaid or accrued lease payments recognized immediately before the date of initial application.

The Group has applied the following practical expedients:

(a)  On transition to IFRS 16, the weighted average incremental borrowing rate applied to lease liabilities recognized under IFRS 16 range between 8% to 10.75% p.a.

(b)  On transition for leases previously accounted for as operating leases with a remaining lease term of less than 12 months and for leases of low- value assets the Group has applied the optional exemptions to not recognize right of use assets but to account for the lease expense on a straight-line method over the remaining lease term.

(c)  On transition, the Group relied on its assessment made under IAS 37 Provisions, Contingent Liabilities and Contingent Assets as for whether any of the lease contracts are Onerous Contracts instead of testing ROU's for impairment.

For any new contracts entered into on or after 1 April 2019, the Group has considered whether a contract is, or contains a lease. A lease is defined as a contract or part of a contract that conveys the right to use an asset for a period of time in exchange for consideration'. To apply this definition, the Group assesses whether meets three key evaluation, which is whether:

• The contract contains an identified asset, which is either explicitly identified in the contract or implicitly specified by being identified at the time the asset is made available to the Group.

• The Group has the right to obtain substantially all of the economic benefits from the use of the identified asset throughout the period of use, considering its rights within the defined scope of the contract.

• The Group has the right to direct the use of the identified asset throughout the period of use. The Group assess whether it has the right to direct 'how and for what purpose' the asset is used throughout the period of use.

Measurement and recognition of leases as a lessee

At the lease commencement date, the Group recognises a right-of-use asset and a lease liability on the balance sheet. The right-of-use asset is measured at cost, which is made up of the initial measurement of the lease liability, any initial direct costs incurred by the Group, an estimate of any costs to dismantle and remove the asset at the end of the lease, and any lease payments made in advance of the lease commencement date (net of any incentives received).

At the commencement date, the Group measures the lease liability at the present value of the lease payments unpaid at that date, discounted using the interest rate implicit in the lease if that rate is readily available or the Group's incremental borrowing rate.

Lease payments included in the measurement of the lease liability are made up of fixed payments (including in substance fixed), variable payments based on an index or rate, amounts expected to be payable under a residual value guarantee and payments arising from options reasonably certain to be exercised. Subsequent to the initial measurement, the liability will be reduced for payments made and increased for interest.

Subsequent to the initial recognition, a right-of-use asset is depreciated on a straight-line basis from the lease commencement date to the earlier of either the end of the useful life of the right-of-use asset or, the end of the lease term. The Group also assesses the right-of-use asset for impairment when such indicators exist.

The Group has elected to account for new short-term leases and leases of low-value assets using the practical expedients given in IFRS 16, that is instead of recognising a right-of-use asset and a lease liability, the payments in relation to these are recognised as an expense in the consolidated income statement on a straight-line basis over the period of the lease term. 

The Group as a lessor

The Group's accounting policy under IFRS 16 has not changed from the comparative period. As a lessor, the Group classifies its leases as either operating or finance leases. A lease is classified as a finance lease if it transfers substantially all the risks and rewards incidental to ownership of the underlying asset, and classified as an operating lease if it does not.

Operating leases

All other leases are treated as operating leases. Where the Group is a lessee, payments on operating lease agreements are recognised as an expense on a straight-line basis over the lease term. Associated costs, such as maintenance and insurance, are expensed as incurred.

3.8  ACCOUNTING FOR INCOME TAXES

Income tax expense recognized in the consolidated income statement comprises of current and deferred tax.

The same is recognized in the consolidated income statement except to the extent that it relates to items recognized directly in equity or other comprehensive income, in which case it is recognized in equity or other comprehensive income respectively. Current tax is the expected tax payable on the taxable income for the year, using tax rates and laws enacted or substantively enacted at the reporting date, and any adjustment to tax payable in respect of previous years.

Deferred income tax is recognized using the Balance sheet approach, providing for temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for taxation purposes.

Deferred income tax is not recognized for the following temporary differences:

(i)  the initial recognition of assets or liabilities in a transaction that is not a business combination and that affects neither accounting nor taxable profit, and

(ii)  Differences relating to investments in subsidiaries and jointly controlled entities to the extent that it is probable that they will not reverse in the foreseeable future.

Also, deferred tax is not recognized for taxable temporary differences arising upon the initial recognition of goodwill. Deferred tax is measured at the tax rates and laws that are expected to be applied to the temporary differences when they reverse, based on the laws that have been enacted or substantively enacted by the reporting date.

Further, the deferred tax assets and liabilities are offset if there is a legally enforceable right to offset current tax liabilities and assets, and they relate to income taxes levied by the same tax authority on the same taxable entity, or different tax entities, and they intend to settle current tax liabilities and assets on a net basis or their tax assets and liabilities will be realized simultaneously.

A deferred tax asset is recognized to the extent that it is probable that future taxable profits will be available against which the temporary difference can be utilized. Deferred tax assets are reviewed at each reporting date and are reduced to the extent that it is no longer probable that the related tax benefit will be realized.

Changes in deferred tax assets or liabilities are recognized as a component of tax income or expense in the consolidated income statement, except where they relate to items that are recognized in other comprehensive income or directly in equity, in which case the related deferred tax is also recognized in other comprehensive income or equity, respectively.

Deferred tax in respect of undistributed earnings of subsidiaries is recognized except where the Group is able to control the timing of the reversal of the temporary difference and that the temporary difference will not reverse in the foreseeable future.

Deferred tax asset/liability has been recognized for the carry forward of unused tax losses and unused tax credits to the extent that it is probable that future taxable profits will be available against which the unused tax losses and unused tax losses and unused tax credits can be utilized.

3.9  POST EMPLOYMENT BENEFITS, SHORT-TERM AND LONG-TERM EMPLOYEE BENEFITS AND EMPLOYEE COSTS

The Group provides post-employment benefits through defined contribution plans as well as defined benefit plans.

Defined contribution plan

A defined contribution plan is a post-employment benefit plan under which an entity pays fixed contributions into a separate entity and will have no legal or constructive obligation to pay further amounts. Obligations for contributions to recognized provident funds and other social securities which are defined contribution plans are recognized as an employee benefit expense in the consolidated income statement when they are incurred.

Defined benefit plans

A defined benefit plan is a post-employment benefit plan other than a defined contribution plan. Under a defined benefit plan, it is the Group's obligation to provide agreed benefits to the employees. The related actuarial and investment risks fall on the Group.

Liabilities with regard to the defined benefit plans are determined by actuarial valuation, performed by an independent actuary, at each balance sheet date using the projected unit credit method .

The Group recognizes the net obligation of a defined benefit plan in its balance sheet as an asset or liability. Gains and losses through re-measurements of the net defined benefit liability/(asset) are recognized in other comprehensive income. The actual return of the portfolio of plan assets, in excess of the yields computed by applying the discount rate used to measure the defined benefit obligation, is recognized in other comprehensive income. The effect of any plan amendments is recognized in net profits in the consolidated statement of comprehensive income. The net interest cost, past service cost and current service cost is recognized in the consolidated income statement.

Short-term benefits

Short-term benefit obligations are measured on an undiscounted basis and are expensed as the related service is provided.

A liability is recognized for the amount expected to be paid under short-term cash bonus or profit-sharing plans if the Group has 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.

Compensated absences

Eligible employees are entitled to accumulate compensated absences up to prescribed limits in accordance with the Group's policy and receive cash in lieu thereof. The Group measures the expected cost of accumulating compensated absences as the additional amount that the Group expects to pay/incur as a result of the unused entitlement that has accumulated at the reporting date. Such measurement is based on actuarial valuation as at the reporting date carried out by a qualified actuary.

3.10  IMPAIRMENT TESTING OF NON-FINANCIAL ASSETS, GOODWILL, INTANGIBLE ASSETS AND PROPERTY, PLANT AND EQUIPMENT

Non-financial assets

The carrying amounts of the Group's non-financial assets, other than deferred tax assets are reviewed at each reporting date to determine whether there is any indication of impairment. If any such indication exists, then the asset's recoverable amount is estimated. For goodwill and intangible assets that have indefinite lives or that are not yet available for use, the recoverable amount is estimated each year at the same time. 

The recoverable amount of an asset or cash-generating unit (as defined below) is the greater of its value in use or its fair value less cost to sell. In assessing value in use, the estimated future cash flows are discounted to their present value using a post-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. For the purpose of impairment testing, assets are grouped together into the smallest group of assets that generates cash inflows from continuing use that are largely independent of the cash inflows of other assets or groups of assets (the "cash-generating unit"). The goodwill acquired in a business combination is, for the purpose of impairment testing, allocated to cash-generating units that are expected to benefit from the synergies of the combination and represent the lowest level within the Group at which management monitors goodwill.

An impairment loss, if any, is recognized in the consolidated income statement if the carrying amount of an asset or the cash-generating unit exceeds its estimated recoverable amount. Impairment losses recognized in respect of cash-generating units are allocated first to reduce the carrying amount of any goodwill allocated to the units and then to reduce the carrying amount of the other assets in the unit on a pro-rata basis.

An impairment loss in respect of goodwill is not reversed. In respect of other assets, impairment losses recognized in prior periods are assessed at each reporting date for any indications that the loss has decreased or no longer exists. An impairment loss is reversed if there has been a change in the estimates used to determine the recoverable amount. An impairment loss is reversed only to the extent that the asset's carrying amount does not exceed the carrying amount that would have been determined, net of depreciation or amortization if no impairment loss had been recognized.

3.11  FINANCIAL INSTRUMENTS

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

Financial assets are de-recognized when the contractual rights to cash flows from the financial asset expire, or when the financial asset and all substantial risks and rewards are transferred.

A financial liability is de-recognized when it is extinguished, discharged, cancelled or expires.

Financial assets

Classification and initial measurement of financial assets

All financial assets are initially measured at fair value adjusted for transaction costs (where applicable).

Financial assets, other than those designated and effective as hedging instruments, are classified into the following categories:

· amortised cost

· fair value through profit or loss (FVTPL)

· fair value through comprehensive income (FVOCI)

In the periods presented, the Group does not have any financial assets categorised as FVOCI.

The classification is determined by both:

· the entity's business model for managing the financial asset

· the contractual cash flow characteristics of the financial asset

All income and expenses relating to financial assets that are recognized in the consolidated income statement and are presented within finance costs, finance income or other financial items, except for impairment of trade receivables, which is presented within other expenses.

Subsequent measurement of financial assets

Financial assets at amortised cost

Financial assets are measured at amortised cost if the assets meet the following conditions (and are not designated as FVTPL):

• they are held within a business model whose objective is to hold the financial assets and collect its contractual cash flows

• the contractual terms of the financial assets give rise to cash flows that are solely payments of principal and interest on the principal amount outstanding

After initial recognition, these are measured at amortised cost using the effective interest method. Discounting is omitted where the effect of discounting is immaterial. The Group's cash and cash equivalents, trade and most other receivables fall into this category of financial instruments.

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

Financial assets that are held within a different business model other than 'hold to collect' or 'hold to collect and sell' are categorised at fair value through profit and loss. Further, irrespective of business model financial assets whose contractual cash flows are not solely payments of principal and interest are accounted for at FVTPL.

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

The Group accounts for financial assets at FVOCI if the assets meet the following conditions:

• they are held under a business model whose objective it is "hold to collect" the associated cash flows and sell and

• the contractual terms of the financial assets give rise to cash flows that are solely payments of principal and interest on the principal amount outstanding.

Any gains or losses recognised in other comprehensive income (OCI) will be recycled upon derecognition of the asset.

Impairment of financial assets

IFRS 9's impairment requirements use more forward-looking information to recognise expected credit losses- the 'expected credit loss (ECL) model'. This replaced IAS 39's 'incurred loss model'. Instruments within the scope of the new requirements included loans and other debt-type financial assets measured at amortised cost and FVOCI, trade receivables, contract assets recognised and measured under IFRS 15 and loan commitments and some financial guarantee contracts (for the issuer) that are not measured at fair value through profit or loss.

Trade and other receivables

The Group makes use of a simplified approach in accounting for trade and other receivables and records the loss allowance as lifetime expected credit losses. These are the expected shortfalls in contractual cash flows, considering the potential for default at any point during the life of the financial instrument. In calculating the same, Group uses its historical experience, external indicators and forward-looking information to calculate the expected credit losses using a provision matrix.

The Group assess impairment of trade receivables on a collective basis as they possess shared credit risk characteristics they have been grouped based on the days past due.

Cash and cash equivalents

Cash and cash equivalents in the consolidated statement of financial position and consolidated statement of cash flow comprise cash at banks and on hand and short-term deposits with an original maturity of three months or less from inception and which are subject to an insignificant risk of changes in value.  

Restricted deposits

Restricted deposits consist of deposits pledged with government authorities for the Group's Indian subsidiaries and deposits restricted as to usage under lien to banks for guarantees given by the Group.

Others

Other non-derivative financial instruments are measured at amortized cost using the effective interest rate method, less any impairment losses.

The Group holds derivative financial instruments to hedge its foreign currency exposure. The Group does not apply hedge accounting to these instruments.

Derivatives are recognized initially at fair value; transaction costs are recognized in the consolidated income statement when incurred. Subsequent to initial recognition, derivatives are measured at fair value, and changes therein are recognized in the consolidated income statement.

Financial liabilities

The Group's financial liabilities include trade and other payables, borrowings and derivative financial instruments. Trade and other payables and borrowings are initially measured at fair value and subsequently measured at amortized cost using the effective interest rate method. They are included in the consolidated statement of financial position line items 'long-term borrowings' and 'trade and other payables'.

Financial liabilities are recognized when the Group becomes a party to the contractual agreements of the instrument. All interest related charges are recognized as an expense in "finance cost" in the consolidated income statement. Subsequently, financial liabilities are measured at amortised cost using the effective interest method except for derivatives and financial liabilities designated at FVTPL, which are carried subsequently at fair value with gains or losses recognized in the consolidated income statement (other than derivative financial instruments that are designated and effective as hedging instruments).

All interest-related charges and, if applicable, changes in an instrument's fair value that are reported in the consolidated income statement are included within finance costs or finance income.

An exchange between an existing borrower and lender of debt instrument with substantially different terms shall be accounted for as an extinguishment of the original financial liability and the recognition of the new financial liability. Similarly, a substantial modification of the terms of the existing financial liability or a part of it shall be accounted for as an extinguishment of the original financial liability and the recognition of a new financial liability. In exchange the debt instrument or the modification of the terms is accounted as an extinguishment, any costs or fees incurred are recognised as the part of the loss or gain on the extinguishment. If the exchange or the modification of the terms is not accounted as an extinguishment, any cost or fees incurred adjust the carrying amount of the liability and amortised over the remaining term of the modified liability .

3.12  OFFSETTING OF FINANCIAL INSTRUMENTS

Financial assets and financial liabilities are offset against each other and the net amount reported in the consolidated statement of financial position only if there is a currently enforceable legal right to offset the recognized amounts and there is an intention to settle on a net basis or to realize the assets and settle the liabilities simultaneously.

3.13  PROVISIONS, CONTINGENT LIABILITIES AND CONTINGENT ASSETS

Provisions are recognized when present obligations as a result of past events will probably lead to an outflow of economic resources from the Group and they can be estimated reliably. Timing or amount of the outflow may still be uncertain. A present obligation arises from the presence of a legal or constructive obligation that has resulted from past events.

Provisions are measured at the estimated expenditure required to settle the present obligation, based on the most reliable evidence available at the end of the reporting period, including the risks and uncertainties associated with the present obligation.

In those cases, where the possible outflow of economic resource as a result of present obligations is considered improbable or remote, or the amount to be provided for cannot be measured reliably, no liability is recognized in the consolidated statement of financial position.

Any reimbursement that the Group can be virtually certain to collect from a third party with respect to the obligation is recognized as a separate asset. However, this asset may not exceed the amount of the related provisions. All provisions are reviewed at each reporting date and adjusted to reflect the current best estimate.

3.14  BUSINESS COMBINATIONS

The Group applies the acquisition method in accounting for business combinations. The consideration transferred by the Group to obtain control of a subsidiary is calculated as the sum of the acquisition-date fair values of assets transferred, liabilities incurred and the equity interests issued by the Group, which includes the fair value of any asset or liability arising from a contingent consideration arrangement. Acquisition costs are expensed as incurred.

The Group recognizes identifiable assets acquired and liabilities assumed in a business combination regardless of whether they have been previously recognized in the acquirer's financial statements prior to the acquisition. Assets acquired and liabilities assumed are generally measured at their acquisition-date fair values.

Goodwill is stated after separate recognition of identifiable intangible assets. It is calculated as the excess of the sum of a) fair value of consideration transferred, b) the recognized amount of any non-controlling interest in the acquiree and c) acquisition-date fair value of any existing equity interest in the acquiree, over the acquisition-date fair values of identifiable net assets. If the fair values of identifiable net assets exceed the sum calculated above, the excess amount (i.e. gain on a bargain purchase) is recognized in the consolidated income statement immediately.

For common control transactions, not covered under IFRS 3 (revised), the Group applies the pooling of interest method. Under a pooling of interests-type method, the acquirer accounts for the combination as follows:

· The assets and liabilities of the acquiree are recorded at book value, not fair value (although adjustments should be recorded to achieve uniform accounting policies);

· Intangible assets and contingent liabilities are recognized only to the extent that they were recognized by the acquiree in accordance with applicable IFRS (in particular IAS 38);

· No goodwill is recorded. The difference between the acquirer's cost of investment and the acquiree's equity is presented as a separate reserve within equity on consolidation;

· Any non-controlling interest is measured as a proportionate share of the book values of the related assets and liabilities (as adjusted to achieve uniform accounting policies);

· Any expenses of the combination are written off immediately in the consolidated income statement;

· Comparative amounts are restated as if the combination had taken place at the beginning of the earliest comparative period presented.

3.15  EQUITY

Share capital is determined using the nominal value of shares that have been issued.

Additional paid-in capital includes any premium received on the issue of share capital. Any transaction costs associated with the issue of shares is deducted from additional paid-in capital, net of any related income tax benefits.

Foreign currency translation differences on translation of foreign operations are included in the currency translation reserve.

Other components of equity include the following:

· Re-measurement of net defined benefit liability - comprises the actuarial losses from changes in actuarial assumptions and the return on plan assets

·   translation reserve - comprises foreign currency translation differences arising from the translation of financial statements of the Group's foreign entities into USD

Retained earnings include all current and prior period earnings, as disclosed in the consolidated income statement.

Share compensation reserve includes cumulative share-based remuneration recognized as an expense in the consolidated income statement.

The balance on the merger reserve represents the excess of the fair value of the consideration paid over the book value of net assets acquired in a common control transaction accounted for using pooling of interest method.

All transactions with owners of the parent are recorded separately within equity.

3.16  SIGNIFICANT ACCOUNTING JUDGMENTS, ESTIMATES AND ASSUMPTIONS

The preparation of the Group's consolidated financial statements requires management to make judgments, estimates and assumptions that affect the reported amounts of revenues, expenses, assets and liabilities, and the disclosure of contingent liabilities, at the end of the reporting period. However, uncertainty about these judgments, assumptions and estimates could result in outcomes that require a material adjustment to the carrying amount of the asset or liability affected in future periods.

The Group has also considered the possible effects that may result from the pandemic relating to COVID-19 on the carrying amounts of receivables, goodwill and intangible assets with indefinite life. In developing the assumptions relating to the possible future uncertainties in the global economic conditions because of this pandemic, the Group, as at the date of approval of these financial statements has used internal and external sources of information including credit reports and related information, economic forecasts. The Group has performed sensitivity analysis on the assumptions used and based on current estimates expects the carrying amount of these assets will be recovered. The impact of COVID-19 on the Group's consolidated financial statements may differ from that estimated as at the date of approval of these consolidated financial statements.

In the process of applying the Group's accounting policies, management has made the following judgments, estimates and assumptions which have the most significant effect on the amounts recognized in the consolidated financial information:

Significant Estimations

Goodwill impairment review

In assessing goodwill impairment, management makes a judgment in identifying the cash-generating units (CGU) to which the goodwill pertains. Management then estimates the recoverable amount of each asset based on discounted free cash flow to firm ('FCFF') method, covering a four-year forecast of expected cash flows and the terminal value for the unit's remaining useful lives using the growth rates. Estimation uncertainty relates to assumptions about future operating results and the determination of a suitable growth and discount rate (see Note 7).

Post-employment benefits

The cost of defined employee benefits obligations and the present value of these obligations are determined using actuarial valuations. An actuarial valuation involves making various assumptions. These include the determination of the discount rate, future salary increases, expected return on plan assets, mortality rates and attrition rates. Due to the complexity of the valuation, the underlying assumptions and its long-term nature, a

defined benefit obligation is highly sensitive to changes in these assumptions. All assumptions are reviewed at each reporting date.

In determining the appropriate discount rate, management considers the interest rates of high-quality government bonds denominated in the respective currency in which the benefits will be paid, with extrapolated maturities corresponding to the expected duration of the defined benefit obligation.

The mortality rate is based on publicly available mortality tables for the specific country. Future salary increases are based on expected future inflation rates for the respective countries and expected future salary increases for the respective entities. The attrition rate is based on expected future attrition rate for the respective entities. (see Note 18).

Expected credit loss on trade receivables

As at each reporting date, management uses a simplified approach to estimate for trade and other receivables and records the loss allowance as lifetime expected credit losses. These are the expected shortfalls in contractual cash flows, considering the potential for default at any point during the life of the financial instrument. In calculating, the Group uses its historical experience, external indicators and forward-looking information to calculate the expected credit los ses using a provision matrix. Further for the year ended
31 March 2021, the Group has also considered credit reports and other related credit information for its customers to estimate the probability of default in future and has taken-into account estimates of possible effect from the pandemic relating to COVID -19 (Note 12).

Significant judgements

Recognition of deferred tax assets

The extent to which deferred tax assets can be recognized is based on an assessment of the probability of the Group's future taxable income against which the deferred tax assets can be utilized. In addition, significant judgement is required in assessing the impact of any legal or economic limits or uncertainties in various tax jurisdictions (see Note 11).

3.17  OUTSOURCED SERVICE COSTS
 

Outsourced service costs are expenses towards sub-contractors. They are recognized on the basis of contractual terms and invoices received from respective vendors .

4.  NEW AND REVISED STANDARDS THAT ARE EFFECTIVE FOR ANNUAL PERIOD BEGINNING ON OR AFTER 1 APRIL 2020, WHICH HAS AN IMPACT ON THE GROUP

· The International Accounting Standard Board has issued amendments to IFRS 3, 'Business Combinations', in connection with clarification of business definition, which help in determining whether an acquisition made is of a business or a group of assets. The amendment added a test that makes it easier to conclude that a Group has acquired a group of assets, rather than a business, if the value of the assets acquired is substantially all concentrated in a single asset or group of similar assets. The adoption of amendment to IFRS 3 is applicable to new acquisition on a prospective basis and did not have any impact on the consolidated financial statements of the Group.

· The IASB issued Amendment to IAS 1 "Presentation of Financial Statements" and IAS 8 "Accounting Policies, Changes in Accounting Estimates and Errors" to update a new definition of material in IAS 1. The amendments clarify the definition of "material" and how it should be applied by including in the definition guidance that until now has featured elsewhere in IFRS Standards. The new definition clarifies that, information is considered material if omitting, misstating, or obscuring such information, could reasonably be expected to influence the decisions that the primary users of general-purpose financial statements make on the basis of those financial statements. The definition of material in IAS 8 has been replaced by a reference to the definition of material in IAS 1. In addition, the IASB amended other Standards and the Conceptual Framework that contain a definition of material or refer to the term 'material' to ensure consistency. The adoption of the amendment to IAS 1 and IAS 8 did not have any material impact on its evaluation of materiality in relation to the consolidated financial statements.

· 'Interest Rate Benchmark Reform Phase 2 - Amendments to IFRS 9, IAS 39, IFRS 7, IFRS 4 and IFRS 16' was issued in August 2020 and will be effective from 1 January 2021. The Phase 2 amendments address issues that arise from implementation of the reforms, including the replacement of one benchmark with an alternative one. A practical expedient is provided such that the change to contractual cash flows for financial assets and liabilities (including lease liabilities) is accounted for prospectively by revising the effective interest rate. In addition, hedge accounting will not be discontinued solely because of the IBOR reform.

The amendments are not expected to have a material impact on the results or financial position of the Group.

5.  STANDARDS, AMENDMENTS AND INTERPRETATIONS TO EXISTING STANDARDS THAT ARE NOT YET EFFECTIVE AND HAVE NOT BEEN ADOPTED BY THE GROUP

· Amendment to IAS 1 - "Presentation of Financial Statements". On 23 January 2020 the IASB has issued "Classification of liabilities as Current or Non-Current (Amendments to IAS 1)" providing a more general approach to the classification of liabilities under IAS 1 based on the contractual arrangement in place at the reporting date. The amendments aim to promote consistency in applying the requirements by helping companies to determine whether, in the statement of financial position, debt and other liabilities with an uncertain settlement date should be classified as current (due or potentially due to be settled within one year) or noncurrent. The amendments also clarified the classification requirements for debt a Group might settle by converting it into equity. These amendments are effective for annual reporting periods beginning on or after January 1, 2023 and are to be applied retrospectively, with earlier application permitted. The Group is currently evaluating the impact of amendment to IAS 1 on the consolidated financial statements.

· On 14 May 2020 the IASB issued "Onerous Contracts - Cost of Fulfilling a Contract (Amendments to IAS 37)", amending the standard regarding costs a Group should include as the cost of fulfilling a contract when assessing whether a contract is onerous. The amendment specifies that the "cost of fulfilling" a contract comprises the "costs that relate directly to the contract". Costs that relate directly to a contract can either be incremental costs of fulfilling that contract or an allocation of other costs that relate directly to fulfilling contracts. These amendments are effective for annual reporting periods beginning on or after January 1, 2022, with earlier application permitted. The Group is currently evaluating the impact of amendment to IAS 37 on the consolidated financial statements.

· On 14 May 2020 IASB amended IFRS 9 as part of its Annual Improvements to IFRS Standards 2018-2020. The amendment clarifies which fees an entity includes when it applies the '10 percent' test of IFRS 9 in assessing whether to derecognize a financial liability. This amendment is effective for annual reporting periods beginning on or after January 1, 2022, with earlier application permitted. The Group is currently evaluating the impact of amendment to IFRS 9 on the financial statements.

6.  BASIS OF CONSOLIDATION

Composition of the Group

Details of the entities, which as of 31 March 2021 and 31 March 2020 form part of the Group and are consolidated under iEnergizer are as follows:

Name of the entity	Holding company	Country of incorporation	Effective group shareholding (%) as of 31 March 2021 and 31 March 2020
iEnergizer Holdings Limited ('IHL')	iEnergizer	Mauritius	100
iEnergizer IT Services Private Limited ('IITS')	IHL	India	100
iEnergizer BPO Limited	IHL	Mauritius	100
iEnergizer BPO Inc.*	IITS	USA	100
iEnergizer Management Services Limited	iEnergizer	Hong Kong	100
Aptara Inc.	iEnergizer	USA	100
Techbooks International Private Limited	Aptara Inc.	India	100
Techbooks Electronic Services Private Limited	Aptara Inc.	India	100
Global Content Transformation Private Limited	Aptara Inc.	India	100
Aptara Learning Private Limited	Aptara Inc.	India	100
Aptara New Media Private Limited	Aptara Inc.	India	100
Aptara Technologies Private Limited	Aptara Inc.	India	100
iEnergizer Aptara Limited	iEnergizer	Mauritius	100

* During the year ended 31 March 2020, iEnergizer IT Services Private Limited incorporated a wholly-owned subsidiary namely iEnergizer BPO Inc. (USA).

7.  GOODWILL

The net carrying amount of goodwill can be analysed as follows:

Particulars	Amount
Balance as at 1 April 2019	102,256,665
Impairment loss recognized	-
Translation adjustment	(8,635)
Balance as at 31 March 2020	102,248,030

Particulars	Amount
Balance as at 1 April 2020	102,248,030
Impairment loss recognized	-
Translation adjustment	2,335
Balance as at 31 March 2021	102,250,365

For the purpose of annual impairment testing goodwill is allocated to the following Cash Generating Unit (CGU), which are expected to benefit from the synergies of the business combinations in which the goodwill arises.

Particulars	Amount	Amount
	As at 31 March 2021	As at 31 March 2020
Business process outsourcing - India business unit Content delivery - USA business unit	115,541 102,134,824	113,206 102,134,824
Goodwill allocation	102,250,365	102,248,030

The recoverable amounts of the CGU were determined based on discounted free cash flow to firm ('FCFF') method, covering a four-year forecast of expected cash flows and the terminal value for the unit's remaining useful lives using the growth rates stated below:

Particulars	Growth rate	Discount rate
	31 March 2021	31 March 2021
Business process outsourcing - Indian business unit Content delivery - USA business unit	10.50% 5.00%	12.78% 12.78%

Particulars	Growth rate	Discount rate
	31 March 2020	31 March 2020
Business process outsourcing - Indian business unit Content delivery - USA business unit	10.50% 8.00%	13.58% 13.58%

The key assumptions for Content delivery-USA business unit are as follows:

Management considers 'Content Delivery' business as one product line/services and therefore as one group of similar assets for internal management reporting purposes. It is the smallest identifiable group of assets that generates cash inflows that are largely independent of the cash inflows from other assets or group of assets. The goodwill is therefore allocated to this unit and accordingly tested for impairment.

Growth rates

The forecasted growth rates are based on management estimation derived from past experience, comparable company data and external sources of information available. The Group is expected to continue to grow at the above rates for the foreseeable future as it is getting work from customers on a continuous basis rather than one-time work.

Discount rates

Discount rates reflect management's estimates of the risks specific to the business. The pre-tax discount rates used are based on the weighted average cost of capital of the relevant underlying cash-generating unit. 

Cash flow assumptions

Estimated cash flows for 4 years based on internal management budgets prepared using past experience. Management's key assumptions include stable profit margins, based on past experience in this market. The Group's management believes that this is the best available input for forecasting this mature market. Cash flow projections reflect stable profit margins going forward and prices and wages reflect publicly available forecasts of inflation for the industry.

Terminal value

Terminal value has been estimated using Gordon Growth model, which assumes constant growth in cash flows until perpetuity. To estimate long-term perpetual growth rate in future cash flows, expected long-term US economy growth rate of 2.00% was considered as a reasonable proxy.

EV/EBIDTA Multiple

On the basis guidelines companies, financial performance, the market dynamics and current global scenario, the group has taken an EV/LTM EBITDA multiple of 7.5x for estimating the enterprise value as on
31 March 2021.

These assumptions are based on past experience and are consistent with market information.  

Sensitivity analysis of key assumptions

Item	Valuation technique	Key assumptions	Input	Sensitivity to the input to fair value
Goodwill	Free Cash Flow to Firm ('FCFF') method	Gordon - long term growth rate	2.00%	5%  increase  (decrease)  in  terminal value results in an increase  (decrease)  in  fair  value  of  the  goodwill  by  $1.10m and ($1.08m) respectively
		Discount rate	12.78%	5%  increase (decrease) in the discount rate would result in (decrease) increase of enterprise value by ($8.5m) and $9.5m respectively

The discount rate above is based on the Weighted Average Cost of Capital (WACC) of the Group. As at
31 March 2021, the estimated recoverable amount of the CGU exceeded its carrying amount. Reasonable sensitivities in the key assumptions consequent to the change in estimated future economic conditions on account of possible effects relating to COVID-19 is unlikely to cause the carrying amount to exceed the recoverable amount of the cash generating unit.

8. OTHER INTANGIBLE ASSETS

The other intangible assets comprise of the following:

Particulars	Customer contracts	Computer software	Patent	Trademark	Intangibles under development	Total
Cost
Balance as at 1 April 2019	24,112,814	3,944,019	100,000	12,000,000	132,490	40,289,323
Additions	-	511,654	-	-	-	511,654
Disposals	-	-	-	-	-	-
Translation adjustment	(9,657)	(276,192)	-	-	-	(285,849)
Balance as at 31 March 2020	24,103,157	4,179,481	100,000	12,000,000	132,490	40,515,128
Accumulated amortisation
Balance as at 1 April 2019	24,112,814	3,559,966	-	-	-	27,672,780
Amortisation for the period	-	423,580	-	-	-	423,580
Disposals	-	-	-	-	-	-
Translation adjustment	(9,657)	(261,384)	-	-	-	(271,041)
Balance as at 31 March 2020	24,103,157	3,722,162	-	-	-	27,825,319
Impairment
Balance as at 1 April 2019	-	-	-	-	132,490	132,490
Impairment for the period	-	-	-	-	-	-
Disposals	-	-	-	-	-	-
Translation adjustment	-	-	-	-	-	-
Balance as at 31 March 2020	-	-	-	-	132,490	132,490
Carrying values as at 31 March 2020	-	457,319	100,000	12,000,000	-	12,557,319

Particulars	Customer contracts	Computer software	Patent	Trade mark	Intangibles under development	Total
Cost
Balance as at 1 April 2020	24,103,157	4,179,481	100,000	12,000,000	132,490	40,515,128
Additions	-	706,210	-	-	-	706,210
Disposals	-	-	-	-	-	-
Translation adjustment	2,612	83,645	-	-	-	86,257
Balance as at 31 March 2021	24,105,769	4,969,336	100,000	12,000,000	132,490	41,307,595
Accumulated amortisation
Balance as at 1 April 2020	24,103,157	3,722,162	-	-	-	27,825,319
Amortisation for the period	-	694,385	-	-	-	694,385
Disposals	-	-	-	-	-	-
Translation adjustment	2,612	79,562	-	-	-	82,174
Balance as at 31 March 2021	24,105,769	4,496,109	-	-	-	28,601,878
Impairment
Balance as at 1 April 2020	-	-	-	-	132,490	132,490
Impairment for the period	-	-	-	-	-	-
Disposals	-	-	-	-	-	-
Translation adjustment	-	-	-	-	-	-
Balance as at 31 March 2020	-	-	-	-	132,490	132,490
Carrying values as at 31 March 2021	-	473,227	100,000	12,000,000	-	12,573,227

Intangible assets with indefinite useful lives

Trademark relate to Group's branding in the publishing industry and is associated with its long-standing history in the trade and its working relationship with big publishing houses in the world. It distinguishes the Group in Content delivery segment from the competition. The Group has developed a proprietary technology platform, comprising a standardized set of technological tools namely Powersuite, PXE4, PowerLearn, PowerL2X, Power Eye through an extensive research and development initiative which thereby gives the Group an edge over its competitors. The management believes that the Group's branding would continue to contribute towards revenue growth in perpetuity and the value is not expected to diminish in the foreseeable future. Accordingly, the useful lives have been determined to be indefinite.

For the purpose of annual impairment testing, trademark and patent are allocated to the 'Content delivery' business of the Group with respect to the US business unit. 

The net carrying amount of intangible assets with indefinite lives can be analysed as follows:

Particulars	Amount
Balance as at 1 April 2019	12,100,000
Impairment loss recognized	-
Balance as at 31 March 2020	12,100,000

Particulars	Amount
Balance as at 1 April 2020	12,100,000
Impairment loss recognized	-
Balance as at 31 March 2021	12,100,000

The recoverable amounts of the CGU were determined based on discounted free cash flow to firm ('FCFF') method, covering a four-year forecast of expected cash flows and the terminal value for the unit's remaining useful lives using the growth rates.  

9.  PROPERTY, PLANT AND EQUIPMENT

Property, plant and equipment comprise of the following:

Particulars	Computer and data equipment	Office equipment	Furniture and fixtures	Air conditioner and generator	Vehicle	Leasehold improve-ments	Plant and machinery	Capital work in progress	Total
Cost
Balance as at 1 April 2019	8,406,553	854,772	1,438,730	916,719	20,747	4,717,127	2,316,570	224,308	18,895,526
Additions	2,467,719	274,357	39,541	34,233	398,792	152,713	120,773	114,088	3,602,216
Disposals / transfer	(85,706)	-	(16,167)	-	-	-	(15,686)	-	(117,559)
Translation and other adjustment	(684,194)	(66,510)	(95,586)	(67,004)	(23,407)	(334,231)	(147,647)	(7,175)	(1,425,754)
Balance as at 31 March 2020	10,104,372	1,062,619	1,366,518	883,948	396,132	4,535,609	2,274,010	331,221	20,954,429
Balance as at 1 April 2019	5,522,457	778,064	996,024	262,105	16,561	2,846,284	1,866,959	-	12,288,454
Depreciation for the period	1,628,060	62,006	117,881	114,565	29,858	461,149	187,790	-	2,601,309
Disposals	(85,037)	-	(16,083)	-	-	-	(15,261)	-	(116,381)
Translation and other adjustments	(466,409)	(52,044)	(69,242)	(24,599)	(2,745)	(220,207)	(126,407)	-	(961,653)
Balance as at 31 March 2020	6,599,071	788,026	1,028,580	352,071	43,674	3,087,226	1,913,081	-	13,811,729
Carrying values as at 31 March 2020	3,505,301	274,593	337,938	531,877	352,458	1,448,383	360,929	331,221	7,142,700

Particulars	Computer and data equipment	Office Equipment	Furniture and fixtures	Air conditioner and generator	Vehicle	Leasehold improve-ments	Plant and machinery	Capital work in progress	Total
Cost
Balance as at 01 April 2020	10,104,372	1,062,619	1,366,518	883,948	396,132	4,535,609	2,274,010	331,221	20,954,429
Additions	2,011,543	65,076	21,965	48,436	-	198,516	121,393	-	2,466,929
Disposals (Net)/ transfer	(256,417)	(129)	-	-	-	-	(21,213)	(123,247)	(401,006)
Translation and other adjustment	246,417	20,509	25,986	18,089	8,173	91,939	42,077	6,333	459,523
Balance as at 31 March 2021	12,105,915	1,148,075	1,414,469	950,473	404,305	4,826,064	2,416,267	214,307	23,479,875
Balance as at 01 April 2020	6,599,071	788,026	1,028,580	352,071	43,674	3,087,226	1,913,081	-	13,811,729
Depreciation for the period	2,036,286	76,359	91,142	108,634	49,068	491,560	126,306	-	2,979,355
Disposals (Net)	(199,976)	(129)	-	-	-	-	(21,213)	-	(221,318)
Translation and other adjustments	153,256	15,229	19,894	8,483	1,452	67,231	36,123	-	301,668
Balance as at 31 March 2021	8,588,637	879,485	1,139,616	469,188	94,194	3,646,017	2,054,297	-	16,871,434
Carrying values as at 31 March 2021	3,517,278	268,590	274,853	481,285	310,111	1,180,047	361,970	214,307	6,608,441

10.  LONG TERM FINANCIAL ASSETS

Particulars	31 March 2021	31 March 2020
Security deposits	686,922	382,614
Restricted cash	1,398,071	1,881,726
Fixed deposit with banks	1,226,746	1,087,641
	3,311,739	3,351,981

Security deposits are interest free unsecured deposits placed with owners of the property leased in India to the Group for operations in operating centres. The above security deposits have been discounted to arrive at their fair values at initial recognition using market interest rates applicable in India, which approximates 5.89% per annum. These security deposits have maturity terms of 1-14 years. The management estimates the fair value of these deposits to be not materially different from the amounts recognized in the financial statements at amortized cost at each reporting date.

Restricted cash represents deposits that have been pledged with reputable banks against guarantees issued to tax and other local authorities as security to meet contractual obligations towards other parties along with accrued interest on these deposits which is also inaccessible for use by the Group. These deposits have an average maturity period of more than 12 months from the end of the financial year.

Fixed deposits with banks represent deposits with reputable banks have an average maturity period of more than 12 months from the end of the financial year.

The credit analysis has been performed as per the IFRS 9 requirement, whereas same has no impact on the long term financial assets.

11.  DEFERRED TAX ASSETS AND LIABILITIES

Particulars	1 April 2020	Exchange difference on translation of foreign operations	Other amounts recognized in consolidated  statement of other comprehensive  income	Recognized in  consolidated  income statement	31 March 2021
Deferred tax assets on account of :
Property, plant and equipment and intangibles	960,610	12,699	-	237,605	1,210,914
Employee benefits	1,065,921	27,780	(14,137)	548,293	1,627,857
Net operating losses	1,490,749	-	-	(231,419)	1,259,330
Accruals for expenses	729,023	12,582	-	237,171	978,776
Unrealised gain/ (loss) on derivatives	13,006	(12)	-	(14,639)	(1,645)
Minimum alternate tax	1,037,079	21,391	-	-	1,058,470
Others	469,851	8,540	-	(57,157)	421,234
Total (A)	5,766,239	82,980	(14,137)	719,854	6,554,936
Deferred tax liabilities on account of
Undistributed earnings of the subsidiaries*	11,860,587	154,165	-	-	12,014,752
Total (B)	11,860,587	154,165	-	-	12,014,752
Total (A-B)	(6,094,348)	(71,185)	(14,137)	719,854	(5,459,816)
Amounts presented in consolidated statement of financial position
Deferred tax assets	3,623,361	-	-	-	3,469,843
Deferred tax liabilities	(9,717,709)	-	-	-	(8,929,659)
Net	(6,094,348)	-	-	-	(5,459,816)

In assessing the realisability of deferred tax assets, the Group considers the extent to which, it is probable that the deferred tax asset will be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable profits during the periods in which those temporary differences and tax loss carry-forwards become deductible. The Group considers the expected reversal of deferred tax liabilities, projected future taxable income and tax planning strategies in making this assessment.

Based on this, the Group believes that it is probable that the Group will realize the benefits of these deductible differences. The amount of the deferred tax asset considered realizable, however, could be reduced in the near term if the estimates of future taxable income during the carry-forward period are reduced.

The Group has recognized deferred tax assets of USD 1,259,330 (31 March 2020: USD 1,490,749) in respect of carry forward losses of its various subsidiaries as at 31 March 2021 and 31 March 2020 respectively. Management's projections of future taxable income and tax planning strategies support the assumption that it is probable that sufficient taxable income will be available to utilize these deferred tax assets.

*At the balance sheet date, the aggregate amount of temporary differences associated with undistributed earnings of subsidiaries for which deferred tax liabilities recognised till date amounted to USD 12,014,752. The Group does not foresee additional tax outflow in respect of these undistributed earnings, therefore has restricted recognition of DTL to the said amount as the Group is in a position to control the timing of the reversal of the temporary differences, and it is probable that any additional temporary differences will not reverse in the foreseeable future.

Particulars	1 April 2019	Exchange difference on translation of foreign operations	Other amounts recognized in consolidated  statement of other comprehensive  income	Recognized in  consolidated  income statement	31 March 2020
Deferred tax assets on account of:
Property, plant and equipment and intangibles	1,121,727	(36,179)	-	(124,938)	960,610
Employee benefits	1,140,461	(81,205)	37,738	(31,073)	1,065,921
Net operating losses	2,384,668	-	-	(893,919)	1,490,749
Accruals for expenses	546,285	(33,494)	-	216,232	729,023
Unrealised gain/ (loss) on derivatives	21,700	35	-	(8,729)	13,006
Minimum alternate tax	1,276,919	(82,016)	-	(157,824)	1,037,079
Others	170,935	(64,784)	-	363,700	469,851
Total (A)	6,662,695	(297,643)	37,738	(636,551)	5,766,239
Deferred tax liabilities on account of:
Undistributed earnings of the subsidiaries	10,426,088	(542,076)	-	1,976,575	11,860,587
Others	85,115	-	-	(85,115)	-
Total (B)	10,511,203	(542,076)	-	1,891,460	11,860,587
Total (A-B)	(3,848,508)	244,433	37,738	(2,528,011)	(6,094,348)
Amounts presented in consolidated statement of financial position
Deferred tax assets	4,726,068	-	-	-	3,623,361
Deferred tax liabilities	(8,574,576)	-	-	-	(9,717,709)
Net	(3,848,508)	-	-	-	(6,094,348)

12.  TRADE AND OTHER RECEIVABLES

Particulars	31 March 2021	31 March 2020
Trade receivables
Gross value	41,376,456	36,602,112
Less: Provision for bad and doubtful debts	(5,683,919)	(2,992,284)
Less: Rebate accrued to the customer during the year	(1,799,395)	(1,566,872)
Net value	33,893,142	32,042,956
Other receivables
Gross value	60,895	60,227
Less: Provision for bad and doubtful receivables	(60,274)	(59,056)
Net value	621	1,171
	33,893,763	32,044,127

The trade receivables have been recorded at their respective carrying amounts and are not considered to be materially different from their fair values as these are expected to realize within a short period from the reporting dates. All of the Group's trade and other receivables have been reviewed for indicators of impairment.

Gross value of top five customer balances for the year ended 31 March 2021 amounts to USD 16,694,296 which constitutes 49.25 % (31 March 2020: USD 13,218,363 being 40.38 %) of net trade receivables.

All of the Group's trade and other receivables have been reviewed as per the requirement of IFRS 9 expected credit loss. Out of the total receivable an allowance for credit losses of USD 3,919,116  
(31 March 2020: USD 1,585,399) has been recorded under the other expenses.

The analysis of provision for expected credit loss is as follows:

Particulars	31 March 2021	31 March 2020
Opening balance	2,992,284	2,216,112
Charge during the year	3,919,116	1,585,399
Provision reversed	(1,227,481)	(809,227)
Closing balance	5,683,919	2,992,284

The analysis for provision for expected credit loss of other receivables is as follows:

Particulars	31 March 2021	31 March 2020
Opening balance	59,056	63,561
Charge during the year	-	-
Provision utilized	1,218	(4,505)
Closing balance	60,274	59,056

As a practical expedient, the Group uses a provision matrix to determine impairment loss allowance on portfolio of its trade receivables. The provision matrix is based on its historically observed default rates over the expected life of the trade receivables and is adjusted for forward looking estimates. At every reporting date, the historical observed default rates are updated and changes in the forward-looking estimates are analysed. On that basis, the Group estimates the following provision matrix at the reporting date, except to the individual cases where recoverability is certain.

ECL impairment loss allowance (or reversal) recognised during the period is recognised as income/ expense in the consolidated income statement. This amount is reflected under the head 'other expenses' in the consolidated income statement.

The analysis of rebate accruals is as follows:

Particulars	31 March 2021	31 March 2020
Opening balance	1,566,872	1,793,241
Less: Rebates utilized during the year	(416,003)	(543,091)
Add: Rebates provided to customers during the year	648,526	316,722
Closing balance	1,799,395	1,566,872

13.  CASH AND CASH EQUIVALENTS

Particulars	31 March 2021	31 March 2020
Cash in hand	9,637	20,190
Cash in current accounts	51,369,262	43,525,802
Remittance in transit	-	1,601,791
	51,378,899	45,147,783

14.  SHORT TERM FINANCIAL ASSETS

Particulars	31 March 2021	31 March 2020
Security deposits	30,767	60,516
Restricted cash	6,444,738	4,293,982
Short term investments (fixed deposits with maturity less than 12 months)	9,550,799	3,244,643
Derivative financial instruments	151,913	-
Due from officers and employees	38,336	27,244
Others	65,371	16,256
	16,281,924	7,642,641

Short term investments comprise of investment in deposits, denominated in various currency, with reputed banks having high ratings assigned by international and domestic credit rating agencies, bearing fixed rate of interest. Ratings are monitored periodically and the Group has considered the latest available credit ratings in view of COVID - 19 as at the date of approval of these consolidated financial statements.

The credit risk analysis has been performed as per the IFRS 9 requirement in Note 32, whereas the same has negligible impact on the short-term financial assets.

15.  OTHER CURRENT ASSETS

Particulars	31 March 2021	31 March 2020
Prepayments	1,280,205	1,248,854
Statutory dues recoverable	1,484,233	982,302
Unbilled revenue	600,187	-
Others	198,256	357,867
	3,562,881	2,589,023

 

16.  LONG TERM BORROWINGS AND CURRENT PORTION OF LONG-TERM BORROWINGS

Particulars	31 March 2021	31 March 2020
Finance lease obligation (refer note 25)	5,191,699	5,683,551
Term loan*	162,117,051	37,837,207
Total borrowings	167,308,750	43,520,758
Less: Current portion of long-term borrowings
Finance lease obligation (refer note 25)	1,424,940	1,216,547
Term loan*	22,978,093	9,311,228
Current portion of long-term borrowings	24,403,033	10,527,775
Long term borrowings	142,905,717	32,992,983

On 29 December 2020, the Group entered into a 5-year senior secured term loan facility (the "Facility") for an aggregate amount of USD 165,000,000, including a USD 15,000,000 revolving credit facility. The senior secured term loan facility bears floating interest rate per annum equal to LIBOR plus 3.75% per annum (with a 0.75% LIBOR floor) and the term loan facility is repayable in quarterly instalments with an annual principal amortization of 5% in the first two years and 10% in the next three years commencing from 31 March 2021. The term loan are measured at fair value less directly attributable transaction cost (USD 2,350,000) and will be amortised over the period of loan.

The said facility was secured by all the assets of iEnergizer Limited and its subsidiaries Aptara Inc.,
iEnergizer Holdings Limited and iEnergizer Aptara Limited the loan amount was used to repay its existing term loan in full and the balance amount paid to the shareholders subsequently on 5 February 2021 as a special dividend as per the purpose of the loan.

17.  TRADE AND OTHER PAYABLES

Particulars	31 March 2021	31 March 2020
Due to trade creditors	5,499,203	6,236,578
Other accrued expenses	7,430,113	5,245,307
	12,929,316	11,481,885

 

18.  EMPLOYEE BENEFIT OBLIGATIONS

Employee benefits are accrued in the period in which the associated services are rendered by employees of the Group. Employee benefit obligations include the components as follows:

Particulars	31 March 2021			31 March 2020
	Current	Non-current	Total	Current	Non-current	Total
Provision for gratuity	414,179	2,673,497	3,087,676	344,371	2,364,018	2,708,389
Provision for compensated absences	358,552	1,806,219	2,164,771	279,281	1,458,076	1,737,357
Accrued pension liability	187,156	228,731	415,887	186,962	844,967	1,031,929
	959,887	4,708,447	5,668,334	810,614	4,667,061	5,477,675

Gratuity

The Group provides gratuity benefit to its employees working in India. The gratuity plan is a defined benefit plan that, at retirement or termination of employment, provides eligible employees with a lump sum payment, which is a function of the last drawn salary and completed years of service.

Compensated absences

The Group has accumulating compensated absences policy. The Group measures the expected cost of accumulating compensated absences as the additional amount expected to be paid or availed as a result of the unused entitlement that has accumulated at the end of reporting period.

Accrued pension

The Group sponsors a non-contributory defined benefit pension plan (the "DB Plan") covering all full-time employees of one of its subsidiaries meeting specified entry-age requirements. Pension benefits are based upon a formula contained in the DB Plan documents that takes into consideration years of service. The Group's funding policy is based on actuarial recommended contribution. The actuarial cost method utilized to calculate the present value of benefit obligations is the projected unit credit cost method. The DB Plan assets are held by a bank, as trustee, principally in the form of mutual fund units, money market securities, corporate bonds, and U.S. government securities. The DB Plan has no liabilities.

The defined benefit obligation is calculated annually by an independent actuary using projected unit credit method. Changes in the present value of the defined benefit obligation with respect to gratuity and accrued pension liability are as follows:

    31 March 2021

Particulars	Gratuity	Accrued pension
Change in benefit obligation
Opening value of obligation	2,767,579	2,917,951
Interest expense	193,510	87,880
Current service cost	459,601	-
Benefits paid	(301,508)	(179,515)
Re-measurement: actuarial (gain)/loss from changes in assumptions	(56,169)	(46,152)
Translation adjustment	66,225	-
Defined benefit obligation at the year end	3,129,238	2,780,164
Fair value of planned assets	(41,563)	(2,364,277)
Defined benefit obligation at the year-end (net)	3,087,675	415,887

Expenses related to the Group's defined benefit plans are as follows:

   31 March 2021

Particulars	Gratuity	Accrued pension
Net benefit obligation
Amounts recognized in consolidated income statement (including plan assets)
Current service cost	459,601	-
Net interest expense	193,510	87,880
Actuarial gain	(52,330)	(46,152)
Expense recognized in consolidated income statement	600,781	41,728

    31 March 2020

Particulars	Gratuity	Accrued pension
Change in benefit obligation
Opening value of obligation	2,487,375	2,854,006
Interest expense	186,860	105,373
Current service cost	433,862	-
Benefits paid	(260,745)	(175,745)
Re-measurement: actuarial loss from changes in assumptions	128,440	134,317
Translation adjustment	(202,452)	-
Defined benefit obligation at the year end	2,773,340	2,917,951
Fair value of planned assets	(64,951)	(1,886,022)
Defined benefit obligation at the year-end (net)	2,708,389	1,031,929

Expenses related to the Group's defined benefit plans are as follows:

  31 March 2020

Particulars	Gratuity	Accrued pension
Net benefit obligation
Amounts recognized in consolidated income statement (including plan assets)
Current service cost	433,862	-
Net interest expense	183,795	222,628
Abnormal loss	129,333	134,317
Expense recognized in consolidated income statement	746,990	356,945

The assumptions used in calculation of gratuity obligation are as follows:

Particulars	31 March 2021	31 March 2020
Discount rate	6.91% p.a.	7.51% p.a
Expected rate of increase in compensation levels	4.03% p.a.	4.03% p.a.
Expected rate of return on plan assets	7.38% p.a.	8.00% p.a.
Retirement age	58 years	58 years
Mortality table	IALM (2012-14)	IALM (2006-08)
Withdrawal rates
Up to 30 years	31.22%	29.93%
From 31 to 44 years	13.92%	13.19%
Above 44 years	7.79%	7.70%

Enterprise's best estimate of contribution during the next year amounts to USD 816,404.

The assumptions used in calculation of accrued pension are as follows:

Particulars	31 March 2021	31 March 2020
Discount rate	3.13%	3.12%
Expected rate of return on plan assets	7.5%	7.5%
Retirement age	65 years	65 years
Mortality table	Pri-2012	RP-2014
Withdrawal rates
Up to 30 years
From 31 to 44 years	Refer Note 1	Refer Note 1
Above 44 years

Note 1: Due to the small size of plan, no turnover was assumed.

Enterprise's best estimate of contribution during the next year amounts to USD 187,156.

Plan assets

Gratuity

Particulars	31 March 2021	31 March 2020
Opening balance of fair value of plan assets	64,951	40,795
Expected return on plan assets	5,194	3,065
Employer contribution	109,443	171,034
Benefits paid	(135,260)	(144,617)
Actuarial loss on plan assets	(3,839)	(893)
Exchange fluctuation	1,074	(4,433)
Closing balance of fair value of plan assets	41,563	64,951

Accrued pension

Particulars	31 March 2021	31 March 2020
Opening balance of fair value of plan assets	1,886,022	2,103,022
Actual return on plan assets	581,270	(117,255)
Employer contributions	76,500	76,000
Benefits paid	(179,515)	(175,745)
Closing balance of fair value of plan assets	2,364,277	1,886,022

Particulars		31 March 2021	31 March 2020
Gratuity:
Quoted
Government bonds		6,831	13,958
Infrastructure bonds		2,920	8,037
Corporate bonds		910	5,594
Unquoted
Commercial paper and deposits		-	-
Cash and cash equivalents		202	1,883
Mutual Funds		30,699	35,479
Accrued Pension:
Quoted
Equity mutual funds		1,311,037	984,754
Fixed income		974,735	846,871
Unquoted
Cash and cash equivalents		78,505	54,397

Plan assets do not comprise any of the Group's own financial instruments or any assets used by Group companies . The gratuity plan of the Group is administered by TATA AIA Life Insurance Company Ltd. Plan assets for gratuity and pension plans are invested in below category of investments.

The plans expose the Group to actuarial risks such as interest rate risk, investment risk and longevity risk.

Interest rate risk

The present value of the defined benefit liability is calculated using a discount rate determined by reference to market yields on high quality corporate bonds and government bonds where there is no deep market for high quality corporate bonds. The estimated term of the bonds is consistent with the estimated term of the defined benefit obligation and it is denominated in functional currencies of respective subsidiaries. A decrease in market yield on high quality corporate bonds and government bonds will increase the Group's defined benefit liability, although it is expected that this would be offset partially by an increase in the fair value of certain of the plan assets.

Investment risk

The plan assets at 31 March 2021 are predominantly risk-free government securities, money market and mutual funds. The mutual funds are significantly weighted towards international market funds.

Longevity risk

The Group is required to provide benefits for life for the members of the defined benefit liability. Increase in the life expectancy of the members will increase the defined benefit liability.

The defined benefit obligation and plan assets are composed by geographical locations as follows:

                                                                                                                                         31 March 2021                                                                                      

Particulars	USA	India	Total
Defined benefit obligation	2,780,164	3,129,239	5,909,403
Fair value of plan assets	(2,364,277)	(41,563)	(2,405,840)
	415,887	3,087,676	3,503,563

                                                         31 March 2020

Particulars	USA	India	Total
Defined benefit obligation	2,917,951	2,773,340	5,691,291
Fair value of plan assets	(1,886,022)	(64,951)	(1,950,973)
	1,031,929	2,708,389	3,740,318

Amounts recognized in other comprehensive income related to the Group's defined benefit plans are as follows:

Particulars	31 March 2021
Actuarial loss from changes in demographic assumptions	(56,225)
Actuarial gain from changes in financial assumptions	67,882
Actuarial gain from changes in experience adjustments	44,512
Total gain recognised in other comprehensive income	(56,169)

Particulars	31 March 2020
Actuarial loss from changes in demographic assumptions	(56,528)
Actuarial gain from changes in financial assumptions	(90,020)
Actuarial loss from changes in experience adjustments	274,988
Total expense recognised in other comprehensive income	128,440

All the expenses summarized above were included within items that will not be reclassified subsequently to the income statement in the statement of the consolidated other comprehensive income.

Other defined benefit plan information

The contributions to the defined plans are funded by the Group's subsidiaries. The funding requirements are based on the pension fund's actuarial measurement framework as set out in the funding policies.

Based on historical data, the Group expects contribution of USD 816,404 for Gratuity (31 March 2020: USD 579,339) and USD 187,156 for accrued pension (31 March 2020: USD 186,962) to be paid for the financial year 2021-2022.

The weighted average duration of the defined benefit obligation for Gratuity at 31 March 2021 is 6.6 years   (31 March 2020: 6.6 years).

The significant actuarial assumptions for the determination of the defined benefit obligation are the discount rate, the salary growth rate and the withdrawal rate. The calculation of the net defined benefit liability is sensitive to these assumptions. The following table summarizes the effects of changes in these actuarial assumptions on the defined benefit liability:

	As at 31 March 2021		As at 31 March 2020
Discount rate for gratuity	Increase by 0.5%	Decrease by 0.5%	Increase by 0.5%	Decrease by 0.5 %
(Decrease)/increase in the defined benefit liability	(87,437)	92,319	(93,661)	99,417

		As at 31 March 2021			As at 31 March 2020
Salary growth rate for gratuity		Increase by 0.5%		Decrease by 0.5%	Increase by 0.5%		Decrease by 0.5 %
Increase/(decrease) in the defined benefit liability		92,850		(88,837)	101,404		(96,290)
	As at 31 March 2021					As at 31 March 2020
Discount rate for accrued pension	Increase by 0.25%		Decrease by 0.25%			Increase by 0.25%		Decrease by 0.25 %
(Decrease)/increase in the defined benefit liability	900		(1,300)			(6,400)		6,700

	As at 31 March 2021		As at 31 March 2020
Long-term rate of return for accrued pension	Increase by 0.5%	Decrease by 0.5%	Increase by 0.5%	Decrease by 0.5 %
(Decrease)/increase in the defined benefit liability	(9,100)	9,100	(10,000)	10,000

The present value of the defined benefit obligation is calculated with the same method (project unit credit) as the defined benefit obligation recognized in the statement of financial position. The sensitivity analysis is based on a change in one assumption while not changing all other assumptions. This analysis may not be representative of the actual change in the defined benefit obligation as it is unlikely that the change in the assumptions would occur in isolation of one another as some of the assumptions may be correlated.

Defined contribution plans

Apart from being covered under the Gratuity Plan described earlier, employees of the Group also participate in a provident fund plan in India. Contributions paid or payable are recognized as expense in the period in which they are due. During the year ended 31 March 2021, the Group contributed USD 1,730,773 (31 March 2020: 2,544,141 ) towards the Provident Fund Plan in India.

19.  OTHER CURRENT LIABILITIES

Particulars	31 March 2021	31 March 2020
Employee dues	8,238,430	6,476,652
Statutory dues payable	1,781,235	1,324,876
Unearned revenue	310,930	93,060
Advance from customers	1,427,033	1,156,301
Derivative financial liabilities	-	1,891,422
Others	1,761,650	1,380,902
	13,519,278	12,323,213

Employee dues represents outstanding dues towards the employees in respect of Salary and other incentives.

20.  OTHER OPERATING INCOME

Particulars	31 March 2021	31 March 2020
Foreign exchange gain	1,984,105	2,815,280
Fair valuation gain	151,913	-
Profit on sale of property, plant and equipment	7,818	10,494
Reversal of provision	1,274,848	809,227
Miscellaneous income	945,807	246,527
	4,364,491	3,881,528

21.  FINANCE INCOME

Particulars	31 March 2021	31 March 2020
Interest income on deposit accounts	961,295	856,450
Interest on tax refund	202,800	-
Others	11,828	4,864
	1,175,923	861,314

22.  FINANCE COST

Particulars	31 March 2021	31 March 2020
Interest on borrowings	4,577,051	3,856,880
Interest on finance lease	529,756	587,564
Other borrowing cost at amortised cost	140,806	-
	5,247,613	4,444,444

23.  INCOME TAXES 

Income tax is based on the tax rate applicable in the various jurisdictions in which the Group operates. The effective tax at the domestic rates applicable to profits in the country concerned, as shown in the reconciliation below, have been computed by multiplying the accounting profit with effective tax rate in each jurisdiction in which the Group operates. The entity at Guernsey is zero tax entity.

Tax expense reported in the Consolidated Income Statement for the year ended 31 March 2021 and 31 March 2020 is as follows:

Particulars	31 March 2021	31 March 2020
Current tax expense	5,308,767	5,004,205
Deferred tax expense	(719,854)	2,528,011
Income tax expense included in consolidated income statement	4,588,913	7,532,216

The relationship between the expected tax expense based on the domestic tax rates for each of the legal entities within the Group and the reported tax expense in the consolidated income statement is reconciled as follows:

Particulars	31 March 2021	31 March 2020
Accounting profit for the year before tax	53,525,196	52,554,384
Effective tax at the domestic rates applicable to profits in the country concerned	5,419,338	5,228,084
Deferred tax on undistributed earnings	-	1,899,722
Dividend distribution tax	-	87,019
Income not taxable/expenses not allowed	43,463	249,254
Change in US tax*	(783,438)	(162,163)
MAT credit written off	-	180,548
Others	(90,450)	49,752
Tax expense	4,588,913	7,532,216

* The Tax Cuts and Jobs Act (The TCJA) enacted 22 December 2017, represents the most significant change in U.S tax law since 1986. The changes in law began in 2017 with additional provisions being enacted for the 2019 tax year; significant changes that impacted the Group are as follows:

High Tax Exclusion ('The HTE') from Global Intangible low tax income ('The GILTI')

Final regulations were published in July 2020 after the completion of the Group's 31 March 2020 tax provision. Prior to filing the 2019 federal income tax return, the Group determined that their foreign income was subject to a foreign effective tax rate greater than 18.9% and was therefore excludible from the GILTI and related book-to-tax adjustments. The Group also amended their 2018 returns to reflect this exclusion. The HTE election by the Group resulted in a federal benefit of USD 473,968 and USD 750,111 on their 2019 and 2018 tax returns respectively. The federal benefits are reflected as return to provision adjustments for the US adjusted tax expense reported for the period ended 31 March 2021.

Foreign-Derived Intangible Income "FDII"

FDII is the portion of a domestic corporation's intangible income that is derived from serving foreign markets, and determined on a formulaic basis. Section 250 allows domestic corporations that have FDII to deduct a specified percentage of the excess of the corporation's income from export sales over a fixed return on its tangible depreciable assets for the year. The FDII rules operate in tandem with the GILTI rules under §951A. The FDII deduction was introduced by the TCJA. For taxable years beginning after 31 December 2017, a U.S. corporation may claim an FDII deduction that generally is determined by its net foreign-derived income relative to its total net income and its deemed intangible income, which generally is the excess of its total net income over a routine 10% rate of return on the adjusted tax basis of its total fixed assets. In September 2020, after the completion of their 31 March 2020 tax provision; the Group completed the analysis of their FDII income. The study determined that the Group was eligible for an additional deduction of USD 443,671. The federal benefits for the 2019 income tax return are reflected as return to provision adjustments for the US adjusted tax expense reported for the period ended 31 March 2021. The FDII benefit for the period ending 31 March 2021 is USD 88,638.

24.  EARNINGS PER SHARE

The calculation of the basic earnings per share is based on the profits attributable to ordinary shareholders divided by the weighted average number of shares in issue during the year.

Calculation of basic and diluted earnings per share is as follows:

 Basic earnings per share

Particulars	31 March 2021	31 March 2020
Profit attributable to shareholders	48,936,283	45,022,168
Weighted average number of shares outstanding	190,130,008	190,130,008
Basic earnings per share (USD)	0.26	0.24

  Diluted earnings per share

Particulars	31 March 2021	31 March 2020
Profit attributable to shareholders	48,936,283	45,022,168
Potential ordinary shares	Nil	Nil
Weighted average number of shares outstanding	190,130,008	190,130,008
Diluted earnings per share (USD)	0.26	0.24

25.  LEASES

The Group has leases for office premises. With the exception of short-term leases and leases of low-value underlying assets, each lease is reflected on the balance sheet as a right-of-use asset and a lease liability. Variable lease payments which do not depend on an index or a rate are excluded from the initial measurement of the lease liability and right of use assets. The Group has presented its right-of-use assets in the balance sheet separately from other assets.

Each lease generally imposes a restriction that, unless there is a contractual right for the Group to sublease the asset to another party, the right-of-use asset can only be used by the Group. Some leases contain an option to extend the lease for a further term. The Group is prohibited from selling or pledging the underlying leased assets as security.

Movement for lease liability in cash and non-cash has been disclosed in r econciliation of liabilities arising from financing activities.

(a) Lease liabilities are presented in the statement of financial position as follows:

Particulars	31 March 2021	31 March 2020
Current	1,424,940	1,216,547
Non-current	3,766,759	4,467,004
	5,191,699	5,683,551

(b) The following are amounts recognized in consolidated income statement:

Particulars	31 March 2021	31 March 2020
Depre ciation expenses of right-of-use Interest Expense on the Lease Liability	1,484,349	1,451,931
Interest expense on lease liability	529,756	587,564
Rent expenses*	7,167	9,323
Common area maintenance expenses	165,386	175,566
Total	2,186,658	2,224,384

*Rent expense in respect of Short-Term Lease

 (c) Right to use of assets as at 31 March 2021:

Particulars	Leased premises
Gross block
Balance as at 1 April 2020	6,696,491
Additions during the year	1,009,919
Disposal	(306,301)
Translation adjustment	117,353
Gross block as at 31 March 2021	7,517,462
Accumulated depreciation
Balance as at 1 April 2020	1,393,220
Depreciation for the period	1,484,349
Disposal	(112,393)
Translation adjustment	32,615
Accumulated depreciation as at 31 March 2021	2,797,791
Net block as at 31 March 2021	4,719,671

Right to use of assets as at 31 March 2020:

Particulars	Leased premises
Gross block
Balance as at 31 March 2019	-
IFRS-16 transition	6,311,071
Gross block as at 1 April 2019	6,311,071
Additions during the year	580,409
Translation adjustment	(194,989)
Gross block as at 31 March 2020	6,696,491
Accumulated depreciation
Balance as at 1 April 2019	-
Depreciation for the period	1,451,931
Translation adjustment	(58,711)
Accumulated depreciation as at 31 March 2020	1,393,220
Net block as at 31 March 2020	5,303,271

  (d)   The maturity analysis of the lease liabilities as of 31 March 2021, is as follows:

Payments falling due	Gross future minimum lease payments
	31 March 2021	31 March 2020
Within 1 year	1,870,956	1,616,248
Later than 1 year but less than 5 years	3,670,800	3,341,682
More than 5 years	1,508,367	2,436,638
	7,050,123	7,394,568

26.  FAIR VALUATION GAIN/ (LOSS) ON DERIVATIVES

The fair valuation gain on derivative financial instrument amounts to USD 151,913 during the year ended
31 March 2021 and fair valuation loss on derivative financial instrument in (31 March 2020: USD (1,891,422)). The same has been disclosed in line item "Fair Valuation Gain" in Note 20 "Other operating income".

27.  SHARE CAPITAL

The share capital of iEnergizer consists only of fully paid ordinary shares with a par value of GBP 0.01 per share (previous year GBP 0.01 per share). All shares represent one vote at the shareholder's meeting of iEnergizer Limited and are equally eligible to receive dividends and the repayment of capital.

The total number of shares issued and fully paid up of the Company as on each reporting date is summarized as follows:

Particulars	31 March 2021	31 March 2020
Opening number of shares	190,130,008	190,130,008
Number of shares authorized and issued during the year	-	-
Closing number of shares	190,130,008	190,130,008

 

28.  RELATED PARTY TRANSACTIONS 

The related parties for each of the entities in the Group have been summarized in the table below:

Nature of the relationship	Related Party's Name
I.  Ultimate controlling party	Mr. Anil Aggarwal
II. Entities directly or indirectly through one or more intermediaries, control, are controlled by, or are under common control with, the reported enterprises	EICR Cyprus Limited (Parent of iEnergizer Limited)
III. Key management personnel and significant shareholders:	Mr. Anil Aggarwal (Ultimate Shareholder, EICR Cyprus Limited)
	Mr. Chris de Putron (Director, iEnergizer Limited)
	Mr. Marc Vassanelli (Director, iEnergizer Limited)
	Mr. Mark De La Rue (Director, iEnergizer Limited) Mr. Ashish Madan (CFO and Executive Director, iEnergizer Limited)

Disclosure of transactions between the Group and related parties and the outstanding balances is as under:

Transactions with key managerial personnel and their relative:

Particulars	31 March 2021	31 March 2020
Transactions during the year
Short term employee benefits
Remuneration to directors
Chris de Putron	13,086	12,639
Mark De La Rue	13,086	12,639
Marc Vassanelli	39,636	37,917
Total remuneration	65,808	63,195
Balances at the end of the year	168,926	128,594
(Total remuneration payable to key managerial personnel)

29.  OPERATING SEGMENT

Management currently identifies the Group's two service lines business process outsourcing and content delivery as operating segments on the basis of operations. These operating segments are monitored and operating and strategic decisions are made on the basis of operating segment results.

The Chief Operating Decision Maker ("CODM") evaluates the Group's performance and allocates resources based on an analysis of various performance indicators by operating segments. The Group's reportable segments are as follows:

1.  Business process outsourcing

2.  Content delivery

The measurement of each operating segment's revenues, expenses, assets and liabilities is consistent with the accounting policies that are used in preparation of the consolidated financial statements.

Segment information can be analysed as follows for the reporting years under review:

		31 March 2021
	Business Process Outsource	Content delivery	Total
Revenue from external customers	123,959,092	72,005,244	195,964,336
Other income (including realised foreign exchange gain)	3,192,481	1,172,010	4,364,491
Segment revenue	127,151,573	73,177,254	200,328,827
Cost of outsourced Services	27,215,146	10,893,740	38,108,886
Employee benefit expense	38,804,605	38,146,990	76,951,595
Other expenses	16,750,415	4,215,481	20,965,896
Earnings before interest, tax, depreciation and amortisation	44,381,407	19,921,043	64,302,450
Unrealized Foreign Exchange gain/(loss)	(65,468)	(1,482,007)	(1,547,475)
Depreciation and amortisation	(2,759,996)	(2,398,093)	(5,158,089)
Segment operating profit	41,555,943	16,040,943	57,596,886
Other Income/expense:
Finance income	747,819	428,104	1,175,923
Finance costs	(3,841,536)	(1,406,077)	(5,247,613)
Profit before tax	38,462,225	15,062,971	53,525,196
Income tax expense	(2,393,158)	(2,195,755)	(4,588,913)
Profit after tax	36,069,067	12,867,216	48,936,283
Segment assets	79,829,756	158,507,072	238,336,828
Segment liabilities	163,746,736	45,001,629	208,748,365
Capital expenditure	2,763,289	1,296,522	4,059,811

			31 March 2020
	Business process outsource	Content delivery	Total
Revenue from external customers	120,788,737	70,211,754	191,000,491
Other income (including realized foreign exchange gain)	1,828,990	1,171,138	3,000,128
Segment revenue	122,617,727	71,382,892	194,000,619
Cost of outsourced services	31,802,146	8,507,410	40,309,556
Employee benefit expense	40,854,554	38,392,489	79,247,043
Other expenses	9,398,315	5,312,771	14,711,086
Earnings before interest, tax, depreciation and amortisation	40,562,712	19,170,222	59,732,934
Unrealized foreign exchange gain	237,224	644,176	881,400
Depreciation and amortisation	(2,246,039)	(2,230,781)	(4,476,820)
Segment operating profit	38,553,897	17,583,617	56,137,514
Other income and expense:
Finance income	561,424	299,890	861,314
Finance costs	(535,328)	(3,909,116)	(4,444,444)
Profit before tax	38,579,993	13,974,391	52,554,384
Income tax expense	(3,276,148)	(4,256,068)	(7,532,216)
Profit after tax	35,303,845	9,718,323	45,022,168
Segment assets	70,095,268	153,025,953	223,121,221
Segment liabilities	20,721,093	61,800,147	82,521,240
Capital expenditure	3,053,120	1,060,750	4,113,870

The Group's revenues from external customers and its non-current assets (other than financial instruments, investments accounted for using the equity method, deferred tax assets and post-employment benefit assets) are divided into the following geographical areas:

Location	Revenue	Non-current assets	Revenue	Non-current assets
	31 March 2021	31 March 2021	31 March 2020	31 March 2020
United Kingdom	7,217,609	15	8,241,221	15
India	26,428,167	17,181,576	32,206,048	18,006,677
USA	157,169,261	112,272,135	145,801,849	112,586,600
Rest of the world	5,149,299	9,717	4,751,373	10,009
Total	195,964,336	129,463,443	191,000,491	130,603,301

Revenues from external customers in United Kingdom, as well as its major markets, India and the USA have been identified on the basis of the internal reporting systems.

In year ended 31 March 2021, revenue from one customer (31 March 2020: one customer) amounted to 10% or more of consolidated revenue during the year presented.

31 March 2021

Revenue from	Segment	Amount
Customer 1	Business process outsource	29,991,067

31 March 2020

Revenue from	Segment	Amount
Customer 1	Business process outsource	20,703,195

30.  FINANCIAL ASSETS AND LIABILITIES

Carrying amounts of assets and liabilities presented in the statement of financial position relates to the following categories of assets and liabilities:

Financial assets		31 March 2021		31 March 2020
Non-current assets
	Financial assets measured at amortized cost
	Security deposits	686,922		382,614
	Restricted cash	1,398,071		1,881,726
	Fixed deposits with banks	1,226,746		1,087,641
Current assets
	Financial assets measured at amortized cost
	Trade receivables	33,893,763		32,044,127
	Cash and cash equivalents	51,378,899		45,147,783
	Restricted cash	6,444,738		4,293,982
	Security deposits	30,767		60,516
	Fixed deposits with banks	9,550,799		3,244,643
	Due from officers and employees	38,336		27,244
	Interest accrued on fixed deposit	65,371		16,256
	Fair value through profit and loss:
	Derivative financial instruments	151,913		-
		104,866,325		88,186,532

Financial liabilities			31 March                    2021						31 March 2020
Non-current liabilities
Financial liabilities measured at amortized cost:
	Long term borrowings			142,905,717			32,992,983
Current liabilities
	Financial liabilities measured at amortized cost:
	Trade and other payables			12,929,316			11,481,885
	Current portion of long term borrowings			24,403,033			10,527,775
	Other current liabilities			13,519,278			12,323,213
	Derivative financial instruments			-			1,891,422
					193,757,344			69,217,278

These non-current financial assets and liabilities, current financial assets and liabilities have been recorded at their respective carrying amounts as the management considers the fair values to be not materially different from their carrying amounts recognized in the statement of financial positions. Derivative financial instruments, recorded at fair value through profit and loss, are recorded at their respective fair values on the reporting dates.

31.  COMMITMENT AND CONTINGENCIES

At 31 March 2021 and 31 March 2020, the Group had capital commitment of USD 344,537 and USD 141,848 respectively for acquisition of property, plant and equipment.

The contingent liability in respect of claims filed by erstwhile employees against the group companies amounts to USD 77,886 and USD 55,427 as on 31 March 2021 and 31 March 2020 respectively and in respect of interest on VAT amounts to USD 9,540 as on 31 March 2021 (USD 9,347 as on 31 March 2020).

Guarantees:  As at 31 March 2021 and 31 March 2020, guarantees provided by banks on behalf of the group companies to the revenue authorities and certain other agencies, amount to approximately USD 37,412 and USD 36,732 respectively.

32.  RISK MANAGEMENT OBJECTIVES AND POLICIES

The Group's principal financial liabilities comprise borrowings, trade and other payables. The main purpose of these financial liabilities is to raise finances for the Group's operations. The Group has trade and other receivables, other financial assets and cash and bank balances.

The Group is exposed to market risk, credit risk and liquidity risk.

MARKET RISK

Market risk is the risk that changes in market prices will have an effect on Group's income or value of the financial assets and liabilities. The Group's financial instruments affected by market risk include trade and other receivables, other financial assets, borrowings and trade and other payables.

The sensitivity analysis in the following sections relate to the position as at 31 March 2021. The analysis excludes the impact of movement in market variables on the carrying value of assets and liabilities other than financial assets and liabilities. The sensitivity of the relevant consolidated income statement 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 2021.

Interest rate sensitivity

Interest rate risk primarily arises from floating rate borrowings. As at 31 March 2021, substantially all of our borrowings were subject to floating interest rates, which reset at short intervals. If interest rates were to increase by 1% from 31 March 2021, additional net annual interest expense on our floating rate borrowing would amount to approximately USD 1,621,170. If interest rate were to decrease by 1% would have an equal but opposite effect.

Price risk sensitivity

The Group does not have any financial asset or liability exposed to price risk as at reporting date.

Foreign currency risk

Foreign currency risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in foreign exchange rates. The Group renders services primarily to customers located in the United States including those rendered by its Indian entities. The Group's exposure to the risk of changes in foreign exchange rates relates primarily to the trades receivable in USD on account of contracts for rendering the services. The Group entity has fixed rate forward contracts that are obtained to manage the foreign currency risk in USD denominated trade receivables. Such contracts are taken considering overall receivable position and related expense and are not speculative in nature.

Net short-term exposure in USD equivalents of foreign currency denominated financial assets and liabilities at each reporting date are as follows:

Currency	USD	USD	USD	USD
Foreign currency	AUD	GBP	EURO	SGD
31 March 2021
Financial assets	104,604	1,132,170	176,309	37,815
Financial liabilities	-	-	-	-
Net short-term exposure	104,604	1,132,170	176,309	37,815

Currency	USD	USD	USD	USD
Foreign currency	AUD	GBP	EURO	SGD
31 March 2020
Financial assets	32,801	365,553	32,239	518
Financial liabilities	-	-	-	-
Net short-term exposure	32,801	365,553	32,239	518

For the purpose of computing sensitivity analysis of the foreign currency exposure, the management has considered percentage change in the respective exchange rates with respect to USD from the previous year.

Functional currency	31 March 2021	31 March 2020
AUD	+/- 23.89 %	+/- 15.60 %
GBP	+/- 11.26 %	+/- 5.26 %
EUR	+/- 6.61%	+/- 1.99%
SGD	+/- 5.84%	+/- 5.04%

The following table details Group's sensitivity to appreciation or depreciation in functional currency vis-a-vis the currency in which the foreign currency financial assets and liabilities are denominated:

Currency	USD	USD	USD	USD
Foreign currency	AUD	GBP	EURO	SGD
31 March 2021	24,990	127,482	11,654	2,208
31 March 2020	5,117	19,235	642	26

If the functional currency of the Group would have weakened with respect to various other currencies by percentages mentioned above, then the effect will be a decrease in profit and equity by USD 166,335 (31 March 2020: increase by USD 25,013). If the functional currency had strengthened with respect to the various currencies, there would be an equal and opposite impact on profit and equity for each year.  

CREDIT RISK

Credit risk arises from debtors' inability to make payment of their obligations to the Group as they become due; and by non-compliance by the counterparties in transactions in cash, which is limited, to balances deposited in banks and accounts receivable at the respective reporting dates. The Group is not exposed to any significant credit risk on other financial assets and balances with banks. Further analysis for each category is detailed below:

Trade receivables and other receivables

In case of trade receivables, its customers are given a credit period of 30 to 75 days and the customers do not generally default and make payments on time and other receivables are immediately recoverable.

Gross value of top five customers for the year ended 31 March 2021 are USD   16,694,296 being 49.25% (31 March 2020 USD 13,218,363 being 41.25%) of net trade receivables.  An analysis of age of trade receivables past due net of impairment at each reporting date is summarized as follows:

Particulars	31 March 2021
Not past due	21,581,921
Past due less than three months	11,923,277
Past due more than three months but not more than six months	177,262
Past due more than six months but not more than one year	97,268
More than one year	114,035
Total	33,893,763
Particulars	31 March 2020
Not past due	14,420,874
Past due less than three months	16,029,777
Past due more than three months but not more than six months	1,541,043
Past due more than six months but not more than one year	52,433
More than one year	-
Total	32,044,127

Other financial assets

In case of other financial assets, all the current balances are recoverable on demand while the non-current balances are primarily on account of security deposits given for buildings take on lease.

The maximum exposure to credit risk in other financial assets is summarized as follows :				31 March 2021		31 March 2020
Security deposits				717,689		443,130
Restricted cash				7,842,809		6,175,708
Cash and cash equivalents				51,378,899		45,147,783
Fixed deposits				10,777,545		4,332,284
Due from officers and employees				38,336		27,244
Derivative financial instruments				151,913		-
Interest accrued on fixed deposits				65,371		16,256
Total				70,972,562		56,142,405

Cash and cash equivalents, restricted cash, fixed deposits and interest accrued thereon are held with reputable banks . The maximum exposure to credit risk is in the items stated in Note 14. For the purpose of evaluating expected credit loss as per IFRS 9, the management found the same to be negligible.  

The Group's maximum exposure to credit risk arising from the Group's trade and other receivables and other financial assets at the respective reporting dates is represented by the carrying value of each of these assets.

Credit risk concentrations exist when changes in economic, industrial or geographic factors take place, affecting in the same manner the Group's counterparties whose added risk exposure is significant to the Group's total credit exposure.

LIQUIDITY RISK

Liquidity needs of the Group are monitored on the basis of future cash flow projections.  The Group manages its liquidity needs by continuously monitoring cash flows from customers and by maintaining adequate cash and cash equivalents and short terms investments. Net cash requirements are compared to available cash in order to determine any shortfalls.

Short terms liquidity requirements comprise mainly of sundry creditors, expense payable, and employee dues arising during normal course of business as on each reporting date.  The Group maintains a minimum of sixty days of short-term liquidity requirements in cash and cash equivalents. Long term liquidity requirement is assessed by the management on periodical basis and is managed through internal accruals and through the management's ability to negotiate borrowing facilities. Derivative financial instruments reflect forward exchange contracts that will be settled on a gross basis.

As at 31 March 2021, the Group's financial liabilities having contractual maturities (including interest payments where applicable) are summarized as follows:

31 March 2021	Current		Non-current
Financial liabilities	Due within 60 days	Due in 61 days to 365 days	Due in more than 1 year but not later than 5 years
Trade payables	2,899,256	2,599,947	-
Expenses payable	5,504,267	1,925,830	-
Borrowings	1,910,522	29,706,573	163,029,155
Employee dues	6,874,119	1,364,350	-
Total	17,188,164	35,596,700	163,029,155

As at 31 March 2020, the Group's financial liabilities having contractual maturities (including interest payments where applicable) are summarized as follows:

31 March 2020		Current		Non-current
Financial liabilities	Due within 60 days		Due in 61 days to 365 days		Due in more than 1 year but not later than 5 years
Trade payables	5,992,417		244,161		-
Expenses payable	4,143,851		1,101,456		-
Borrowings	830,756		12,982,801		37,695,741
Employee dues	6,333,418		143,234		-
Bank overdraft	233,651		1,657,771		-
Total	17,534,093		16,129,423		37,695,741

33.  FAIR VALUE HIERARCHY

Level 1 - Quoted prices (unadjusted) in active markets for identical assets or liabilities.

Level 2 - Inputs 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 for the assets or liabilities that are not based on observable market data (unobservable inputs).

No financial assets/liabilities have been valued using level 1 and 3 fair value measurements.

The following table presents fair value hierarchy of assets and liabilities measured at fair value on a recurring basis:

31 March 2021	Total	Fair value measurements at  reporting date using
		Level 2
Liabilities	(Notional amount)
Derivative instruments
Forward contracts (currency - USD/INR)	22,900,000	151,913

31 March 2020	Total	Fair value measurements at reporting date using
		Level 2
Assets	(Notional amount)
Derivative instruments
Forward contracts (currency - USD/INR)	35,850,000	(1,891,422)

The Group's foreign currency forward contracts are not traded in active markets. These have been fair valued using observable forward exchange rates and interest rates corresponding to the maturity of the contract. The effects of non-observable inputs are not significant for foreign currency forward contracts.

34.  CAPITAL RISK MANAGEMENT

The Group's capital comprises of equity attributable to the equity holder of the parent.

The Group monitors gearing ratio i.e. total debt in proportion to its overall financing structure, i.e. equity and debt. Total equity comprises of all the components of equity (i.e., share capital, additional paid in capital, retained earnings etc.). Total debt comprises of all liabilities of the Group. The management of the Group regularly reviews the capital structure and makes adjustment to it in light of changes in economic conditions and the risk characteristic of the Group.

	31 March 2021	31 March 2020
Total equity	29,588,463	140,599,981
Total debts	208,748,365	82,521,240
Overall financing	238,336,828	223,121,221
Gearing ratio	0.88	0.37

The current gearing ratio of the Group is quite high and the primary objective of the Group's capital management is to reduce net debt over the coming financial year whilst investing in business and maximizing shareholder value. In order to meet this objective.

35.  AUDIT FEES EXPENSE FOR GROUP AUDIT AND STANDALONE AUDIT:

Particulars	31 March 2021	31 March 2020
Group audit fees	107,284	107,284
Standalone entities audit fees	42,860	42,860
Other Services	6,068	6,068
Total audit fees	156,212	156,212

36.  POST REPORTING DATE EVENTS

The group does not have any post Balance sheet date event to be reported.

 

END

 

 

FR BXLLLFQLZBBZ