AGS Transact Technologies Limited

Annexure V - Basis of preparation and Significant Accounting Policies

Notes to the Revised Restated Consolidated Financial Information

Basis of consolidation

The Revised Restated Consolidated Financial Information has been prepared in accordance with the requirements of
Ind AS 110 — ‘Consolidated Financial Statements’.

Subsidiaries

Subsidiaries are all entities over which the Group has control. The Group controls an entity when the Group is
exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those
returns through its power to direct the relevant activities of the entity. Subsidiaries are fully consolidated from the
date on which control is transferred to the Group. They are deconsolidated from the date when the control ceases.

The Group combines the financial statements of the parent and its subsidiaries line by line adding together like items
of assets, liabilities, equity, income and expenses. Intra Group transactions, balances and unrealised gains on
transactions between Group companies are eliminated. Unrealised losses are also eliminated unless the transaction
provides evidence of an impairment of the transferred asset. Accounting policies of subsidiaries have been changed
wherever necessary to ensure consistency with the policies adopted by the Group.

The excess of cost to the Group of its investment in subsidiaries, on the acquisition dates over and above the
Group’s share of equity in the subsidiaries, is recognised as ‘Goodwill on Consolidation’ being an asset in the
Revised Restated Consolidated Financial Information. The said Goodwill is not amortised, however, it is tested for
impairment at each Balance Sheet date and the impairment loss, if any, is provided for. On the other hand, where the
share of equity in subsidiaries as on the date of investment is in excess of cost of investments of the Group, it is
recognised as ‘Capital Reserve’ and shown under the head ‘Reserves and Surplus’ in the Restated Consolidated
Statement of Assets and Liabilities. In case of acquisition of additional stake in the existing subsidiary, the excess of
purchase consideration over the Group’s portion of equity of the subsidiary on the date on which the additional
investment is made, is adjusted in equity.

Non-controlling interests in the net assets of consolidated subsidiaries is identified and presented in the Revised
Restated Consolidated Statement of Assets and Liabilities within equity.

Non-controlling interests in the net assets of consolidated subsidiaries consists of:

a) The amount of equity attributable to non-controlling interests at the date on which investment in a subsidiary is
made; and

b) The non-controlling interest’s share of movements in equity since the date parent subsidiary relationship came
into existence.

The profit and other comprehensive income attributable to non-controlling interests of subsidiaries are shown
separately in the Revised Restated Consolidated Statement of Profit and Loss and Revised Restated Consolidated
Statement of Changes in Equity.

Upon loss of control, the Group derecognises the assets and liabilities of the subsidiary, any non-controlling interest
and the other components of equity related to the subsidiary. Any surplus or deficit arising on the loss of control is
recognised in the Revised Restated Consolidated Statement of Profit and Loss. If the Group retains any interest in
the previous subsidiary, then such interest is measured at fair value at the date that control is lost and the differential
is recognised in Revised Restated Consolidated Statement of Profit and Loss. Subsequently, it is accounted for as an
equity-accounted investee depending on the level of influence retained.

As far as possible, the Revised Restated Consolidated Financial Information is prepared using uniform accounting

policies for like transactions and other events in similar circumstances and are presented in the same manner as the
Company’s Revised Restated Standalone Financial Information.

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