Arohan Annual Report 2024-25

153 | Annual Report | 2024-2025 Arohan Financial Services Limited Notes to financial statements for the year ended March 31, 2025 (Contd.) Capital work-in-progress Capital work-in-progress are carried at cost, comprising direct cost and related incidental expenses incurred to acquire property, plant and equipment. Assets which are not ready to its intended use are also shown under capital work-in-progress. (iii) Intangible assets Recognition and initial measurement Intangible assets are stated at their cost of acquisition. The cost comprises purchase price including any import duties and other taxes (other than those subsequently recoverable from taxation authorities), borrowing cost if capitalisation criteria are met and directly attributable cost of bringing the asset to its working condition for the intended use. Subsequent measurement (depreciation method, useful lives and residual value) Intangible assets are amortised over a period of five years from the date when the assets are available for use. The estimated useful life (amortisation period) of the intangible assets is arrived basis the expected pattern of consumption of economic benefits and is reviewed at the end of each financial year and the amortisation period is revised to reflect the changed pattern, if any. Intangible assets under development Intangible assets under development represents expenditure incurred in respect of intangible assets under development and are carried at cost. Cost includes development cost, borrowing costs and other direct expenditure necessary to create, produce and repair the asset to be capable of operating in the manner intended by management. These are recognised as assets when the company demonstrate following recognition requirements: a. The development costs can be measured reliably b. The project is technically and commercially feasible c. The company intends to and has sufficient resources to complete the project d. The company has the ability to use or sell such intangible asset e. The asset will generate probable future economic benefits. (iv) Revenue recognition Revenue from contracts with customers - fees and commission The Company recognizes revenue from contracts with customers (other than financial assets to which Ind AS 109 ‘Financial instruments’ is applicable) as set out in Ind AS 115 ‘Revenue from contracts with customers’. Revenue towards satisfaction of a performance obligation is measured at the amount of transaction price (net of variable consideration) allocated to that performance obligation. The transaction price of goods sold and services rendered is net of variable consideration on account of various discounts and schemes offered as part of the contract. Revenue is recognised for a contract with a customer only when all of the following criteria are met: a. Identify the contract, b. Identify performance obligations, c. Determine the transaction price, 3 Material accounting policies (Contd.)

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