AI assistant
Boardwalktech Software Corp. — Audit Report / Information 2025
Jul 28, 2025
43149_rns_2025-07-28_3981c8c3-183b-4ceb-b152-c0be32432087.pdf
Audit Report / Information
Open in viewerOpens in your device viewer
Boardwalktech Software Corp. Consolidated Financial Statements
As at and for the years ended March 31, 2025 and 2024
Stated in United States dollars
Independent Auditor's Report
MNP
To the Shareholders of Boardwalktech Software Corp.:
Opinion
We have audited the consolidated financial statements of Boardwalktech Software Corp. and its subsidiaries (the "Company"), which comprise the consolidated statements of financial position as at March 31, 2025 and March 31, 2024, and the consolidated statements of loss and comprehensive loss, changes in shareholders' deficit and cash flows for the years then ended, and notes to the consolidated financial statements, including material accounting policy information.
In our opinion, the accompanying consolidated financial statements present fairly, in all material respects, the consolidated financial position of the Company as at March 31, 2025 and March 31, 2024, and its consolidated financial performance and its consolidated cash flows for the years then ended in accordance with IFRS® Accounting Standards as issued by the International Accounting Standards Board.
Basis for Opinion
We conducted our audits in accordance with Canadian generally accepted auditing standards. Our responsibilities under those standards are further described in the Auditor's Responsibilities for the Audit of the Consolidated Financial Statements section of our report. We are independent of the Company in accordance with the ethical requirements that are relevant to our audits of the consolidated financial statements in Canada, 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.
Material Uncertainty Related to Going Concern
We draw attention to Note 1 in the consolidated financial statements, which indicates that the Company generated a net loss and reported a deficit of cash flows from operations during the year ended March 31, 2025 and, as of that date, the Company had an accumulated and working capital deficit. As stated in Note 1, these events or conditions, along with other matters as set forth in Note 1, indicate that a material uncertainty exists that may cast significant doubt on the Company's ability to continue as a going concern. Our opinion is not modified in respect of this matter.
Key Audit Matters
Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the consolidated financial statements of the current period. These matters were addressed in the context of our audit of the consolidated financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.
Except for the matter described in the Material Uncertainty Related to Going Concern section, we have determined that there are no other key audit matters to communicate in our report.
MNP LLP
2000, 112 - 4th Avenue SW, Calgary AB, T2P 0H3
1.877.500.0792 T: 403.263.3385 F: 403.269.8450
Other Information
Management is responsible for the other information. The other information comprises Management's Discussion and Analysis.
Our opinion on the consolidated financial statements does not cover the other information and we do not express any form of assurance conclusion thereon.
In connection with our audits of the consolidated financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the consolidated financial statements or our knowledge obtained in the audits or otherwise appears to be materially misstated. We obtained Management's Discussion and Analysis prior to the date of this auditor's report. If, based on the work we have performed on this other information, 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.
Responsibilities of Management and Those Charged with Governance for the Consolidated Financial Statements
Management is responsible for the preparation and fair presentation of the consolidated financial statements in accordance with IFRS Accounting Standards as issued by the International Accounting Standards Board, and for such internal control as management determines is necessary to enable the preparation of consolidated financial statements that are free from material misstatement, whether due to fraud or error.
In preparing the consolidated financial statements, management is responsible for assessing the Company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so.
Those charged with governance are responsible for overseeing the Company's financial reporting process.
Auditor's Responsibilities for the Audit of the Consolidated Financial Statements
Our objectives are to obtain reasonable assurance about whether the consolidated 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 Canadian generally accepted auditing standards 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 consolidated financial statements.
MNP
As part of an audit in accordance with Canadian generally accepted auditing standards, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:
- Identify and assess the risks of material misstatement of the consolidated financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
- Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control.
- Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.
- Conclude on the appropriateness of management's 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 Company's ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor's report to the related disclosures in the consolidated financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor's report. However, future events or conditions may cause the Company to cease to continue as a going concern.
- Evaluate the overall presentation, structure and content of the consolidated financial statements, including the disclosures, and whether the consolidated financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
- Plan and perform the group audit to obtain sufficient appropriate audit evidence regarding the financial information of the entities or business units within the Company as a basis for forming an opinion on the consolidated financial statements. We are responsible for the direction, supervision and review of the audit work performed for the purposes of the group audit. We remain solely responsible for our audit opinion.
We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audits and significant audit findings, including any significant deficiencies in internal control that we identify during our audits.
We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.
From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the consolidated financial statements of the current period and are therefore the key audit matters. We describe these matters in our auditor's report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.
The engagement partner on the audit resulting in this independent auditor's report is Leanne Bjalek.
Calgary, Alberta
July 28, 2025
MNP LLP
Chartered Professional Accountants
MNP
Boardwalktech Software Corp.
Consolidated Statements of Financial Position
(United States dollars)
| As at March 31 | 2025 | 2024 |
|---|---|---|
| ASSETS | ||
| Current assets | ||
| Cash | 358,510 | 2,231,652 |
| Trade and other receivables (Note 5) | 600,073 | 444,880 |
| Prepaid expenses and deposits | 222,042 | 281,314 |
| Total current assets | 1,180,625 | 2,957,846 |
| Non-current assets | ||
| Property and equipment | 4,271 | 8,769 |
| Right-of-use assets (Note 6) | 491,857 | 798,549 |
| Total assets | 1,676,753 | 3,765,164 |
| LIABILITIES and SHAREHOLDERS' DEFICIENCY | ||
| Current liabilities | ||
| Accounts payable and accrued liabilities (Note 7) | 912,985 | 643,032 |
| Credit facility (Note 8) | 2,622,017 | – |
| Deferred compensation (Note 13) | 177,762 | 241,307 |
| Deferred revenue (Note 9) | 707,415 | 1,290,011 |
| Current portion of lease liabilities (Note 10) | 353,167 | 308,951 |
| Total current liabilities | 4,773,346 | 2,483,301 |
| Non-current liabilities | ||
| Credit facility (Note 8) | – | 2,250,000 |
| Lease liabilities (Note 10) | 267,816 | 622,045 |
| Total liabilities | 5,041,162 | 5,355,346 |
| Shareholders' deficit | ||
| Share capital (Note 15) | 44,582,334 | 43,871,564 |
| Contributed surplus | 7,426,200 | 6,716,856 |
| Accumulated other comprehensive loss | (11,059) | (56,496) |
| Deficit | (55,319,120) | (52,121,627) |
| Total deficit attributed to shareholders | (3,321,645) | (1,589,703) |
| Non-controlling interest (Note 2) | (42,764) | (479) |
| Total shareholders' deficit | (3,364,409) | (1,590,182) |
| Total liabilities and shareholders' deficit | 1,676,753 | 3,765,164 |
Going concern (Note 1)
Subsequent event (Note 21)
Approved by the Board of Directors:
(signed) "Andrew T. Duncan"
Director
(signed) "Steve Bennet"
Director
The accompanying notes are an integral part of these consolidated financial statements.
Boardwalktech Software Corp.
Consolidated Statements of Loss and Comprehensive Loss
(United States dollars)
| For the years ended March 31 | 2025 | 2024 |
|---|---|---|
| Revenue (Note 11) | 4,796,976 | 5,971,622 |
| Cost of sales | 589,905 | 622,050 |
| Gross margin | 4,207,071 | 5,349,572 |
| Expenses | ||
| Salaries, wages and benefits (Note 13(a)) | 4,235,554 | 5,123,547 |
| Share-based payments (Note 17) | 603,158 | 1,006,914 |
| General and administration (Note 12) | 484,745 | 563,948 |
| Professional fees | 618,027 | 660,765 |
| Consulting | 480,325 | 321,900 |
| Deferred compensation (Note 13(b)) | 200,262 | 282,503 |
| Depreciation (Note 6) | 309,599 | 321,075 |
| Total expenses | 6,931,670 | 8,280,652 |
| Operating loss before other expenses | (2,724,599) | (2,931,080) |
| Credit facility interest and fee amortization (Note 8) | (364,316) | (2,312) |
| Imputed lease interest (Note 10) | (79,373) | (72,609) |
| Loss on debt settlement (Note 16) | (52,000) | - |
| Severance costs (Note 13(c)) | - | (103,810) |
| Loss before taxes | (3,220,288) | (3,109,811) |
| Tax expense (Note 14) | (19,490) | (22,527) |
| Net loss for the year | (3,239,778) | (3,132,338) |
| Other comprehensive income (loss) | ||
| Items that may be reclassified to profit or loss | ||
| Exchange differences on translation of subsidiaries | 45,437 | (50,568) |
| Net comprehensive loss for the year | (3,194,341) | (3,182,906) |
| Net loss attributable to: | ||
| Non-controlling interest | (42,285) | - |
| Boardwalktech Software Corp. shareholders | (3,197,493) | (3,132,338) |
| (3,239,778) | (3,132,338) | |
| Net comprehensive loss attributable to: | ||
| Non-controlling interest | (42,285) | - |
| Boardwalktech Software Corp. shareholders | (3,152,056) | (3,182,906) |
| (3,194,341) | (3,182,906) | |
| Net loss per share (Note 18) | ||
| Basic and diluted | (0.06) | (0.06) |
The accompanying notes are an integral part of these consolidated financial statements.
Boardwalktech Software Corp.
Consolidated Statements of Changes in Shareholders' Deficit
(United States dollars)
| Share Capital | Contributed Surplus | Accumulated Other Comprehensive Income (Loss) | Deficit | Non-controlling Interest | Total | |
|---|---|---|---|---|---|---|
| Balance, March 31, 2023 | 42,583,679 | 5,449,865 | (5,928) | (48,989,289) | (479) | (962,152) |
| Unit private placement (Note 15) | 1,468,170 | 234,871 | – | – | – | 1,703,041 |
| Share issue costs (Note 15) | (180,285) | 25,206 | – | – | – | (155,079) |
| Share-based payments (Note 17) | – | 1,006,914 | – | – | – | 1,006,914 |
| Net loss | – | – | – | (3,132,338) | – | (3,132,338) |
| Exchange differences on translation of subsidiaries | – | – | (50,568) | – | – | (50,568) |
| Balance, March 31, 2024 | 43,871,564 | 6,716,856 | (56,496) | (52,121,627) | (479) | (1,590,182) |
| Unit private placement (Note 15) | 767,912 | 30,596 | – | – | – | 798,508 |
| Share issue costs (Note 15) | (57,142) | 8,590 | – | – | – | (48,552) |
| Warrant issuance (Note 16) | – | 67,000 | – | – | – | 67,000 |
| Share-based payments (Note 17) | – | 603,158 | – | – | – | 603,158 |
| Net loss | – | – | – | (3,197,493) | (42,285) | (3,239,778) |
| Exchange differences on translation of subsidiaries | – | – | 45,437 | – | – | 45,437 |
| Balance, March 31, 2025 | 44,582,334 | 7,426,200 | (11,059) | (55,319,120) | (42,764) | (3,364,409) |
The accompanying notes are an integral part of these consolidated financial statements.
Boardwalktech Software Corp.
Consolidated Statements of Cash Flows
(United States dollars)
| For the years ended March 31 | 2025 | 2024 |
|---|---|---|
| Cash provided by (used in) the following activities: | ||
| Operating activities | ||
| Net loss for the year | (3,239,778) | (3,132,338) |
| Depreciation (Note 6) | 309,599 | 321,075 |
| Share-based payments (Notes 17) | 603,158 | 1,006,914 |
| Credit facility interest and fee amortization (Note 8) | 364,316 | – |
| Imputed lease interest (Note 10) | 79,373 | 72,609 |
| Rent incentive (Note 10) | – | (28,057) |
| Loss on debt settlement (Note 16) | 52,000 | – |
| Unrealized foreign exchange | 45,929 | (49,838) |
| Changes in non-cash working capital: | ||
| Trade and other receivables | (155,193) | 886,447 |
| Prepaid expenses and deposits | 59,272 | (17,975) |
| Accounts payable and accrued liabilities | 257,360 | (575,361) |
| Deferred revenue | (582,596) | (2,099,864) |
| Deferred compensation | (41,045) | 260,001 |
| Cash flows provided by (used in) operating activities | (2,247,605) | (3,356,387) |
| Financing activities | ||
| Credit facility proceeds (Note 8) | 3,167,980 | 2,250,000 |
| Credit facility repayments (Note 8) | (2,859,014) | – |
| Credit facility interest paid (Note 8) | (273,672) | – |
| Lease payments (Note 10) | (387,851) | (248,703) |
| Proceeds from unit private placements (Note 15) | 776,008 | 1,560,535 |
| Share issuance costs (Note 15) | (48,552) | (155,079) |
| Cash flows provided by financing activities | 374,899 | 3,406,753 |
| Investing activities | ||
| Purchase of property and equipment | – | (6,122) |
| Proceeds from sale of property and equipment | – | 451 |
| Cash flows used in investing activities | – | (5,671) |
| Change in cash | (1,872,706) | 44,695 |
| Foreign exchange effect on cash held in foreign currencies | (436) | (542) |
| Cash, beginning of year | 2,231,652 | 2,187,499 |
| Cash, end of year | 358,510 | 2,231,652 |
| Taxes paid (Note 14) | 21,107 | 20,701 |
The accompanying notes are an integral part of these consolidated financial statements.
Boardwalktech Software Corp.
Notes to Consolidated Financial Statements
For the years ended March 31, 2025 and 2024
(United States dollars unless otherwise disclosed)
1. Description of Business
Boardwalktech Software Corp. ("Boardwalk" or the "Company") was originally incorporated pursuant to the Business Corporations Act of Alberta. The Company operates from locations in the United States and India and provides enterprise software-as-a-service (SaaS) to global customers. Boardwalk is a publicly traded company whose shares are listed on the TSX Venture Exchange under the symbol BWLK.V and on the OTCQB under the symbol BWLKF. The address of the Company's corporate and registered office is 10050 N Wolfe Road, Cupertino, CA, 95014 USA.
The Company designs and sells collaborative enterprise digital ledger data management technology offered as either a cloud-based platform service that runs industry, or customer specific applications, Boardwalk Application Engine ("BAE") or Boardwalk Enterprise Blockchain ("BEB") platforms.
Going Concern
These consolidated financial statements have been prepared on a going concern basis, which implies the Company will continue to realize its assets and discharge its liabilities in the normal course of business. During the year ended March 31, 2025, the Company generated a net loss of $3,239,778 and reported $2,247,605 of cash flows used by operating activities. As at March 31, 2025, the Company had an accumulated deficit of $55,319,120 and a working capital deficit of $3,592,721. These conditions indicate the existence of material uncertainty which may cast significant doubt on the Corporation's ability to continue as a going concern. The Company's ability to continue as a going concern is dependent upon its ability to achieve and maintain profitable operations and to generate funds therefrom and to continue to raise equity or debt financing sufficient to meet current and future obligations.
Management has been proactive in seeking sources of funding to continue to advance operations. There can be no assurance that such financing will be available on a timely basis under terms acceptable to the Company. Subsequent to March 31, 2025, the Company raised approximately $560,594 of gross proceeds by way of a private placement of units as disclosed in Note 21.
If the going concern assumption is not appropriate, adjustments may be necessary to the carrying amounts and the classification of the Corporation's assets and liabilities. The accompanying consolidated financial statements do not include any adjustments that may result if the Corporation is unable to continue as a going concern, and such adjustments could be material.
2. Basis of Presentation
Statement of compliance
These consolidated financial statements have been prepared in accordance with IFRS® Accounting Standards ("IFRS"), as issued by the International Accounting Standards Board ("IASB") in effect at January 1, 2024.
These consolidated financial statements were authorized for issue in accordance with a resolution of the Board of Directors on July 28, 2025.
Basis of measurement
These consolidated financial statements have been prepared on the historical cost basis except for certain financial instruments and equity instruments, such as common share warrants, stock options and restricted share units ("RSUs") that have been measured at fair value.
Basis of consolidation
The consolidated financial statements include the accounts of the Company and its subsidiaries which are consolidated from the date of acquisition, being the date on which the Company obtained control, and continue to be consolidated until the date that such control ceases. The financial statements of the subsidiaries are prepared for the same reporting period as the parent, using consistent accounting policies. All intercompany balances and transactions are eliminated in full upon consolidation.
These consolidated financial statements include the accounts of the following entities:
| Name of entity | Principle activity | Place of business and operations | Legal ownership |
|---|---|---|---|
| Boardwalk | Legal parent | Canada | – |
| Boardwalktech, Inc. (“Boardwalktech”) | Accounting parent and operating company | United States | 100% owned by Boardwalk |
| Boardwalktech Solutions Private Limited (“BWSPL”) | Research and development company | India | 98% owned by Boardwalktech |
Boardwalktech Software Corp.
Notes to Consolidated Financial Statements
For the years ended March 31, 2025 and 2024
(United States dollars unless otherwise disclosed)
Functional and presentation currency
The functional currency of Boardwalk is the Canadian dollar ("CAD"), the functional currency of Boardwalktech is the United States dollar ("USD") and the functional currency of BWSPL is the Indian Rupee ("INR"). The presentation currency of the Company is the USD.
Adoption of amended IFRS
The Company adopted the following amendment to IFRS issued by the IASB that is mandatorily effective for the Company beginning on April 1, 2025. The adoption has not had a material impact on disclosures or amounts reported in these consolidated financial statements.
IAS 1 Presentation of Financial Statements
Amendments to IAS 1 clarify how conditions with which an entity must comply within twelve months after the reporting period affect the classification of a liability as current or non-current.
3. Summary of Material Accounting Policy Information
Financial instruments
Non-derivative financial instruments
Non-derivative financial instruments comprise cash, trade and other receivables, accounts payable and accrued liabilities, credit facility and deferred compensation. Non-derivative financial instruments are recognized initially at fair value. Subsequent to initial recognition, non-derivative financial instruments are classified based on the business model in which they are held and the characteristics of their contractual cash flows.
IFRS 9 Financial Instruments contains three principal classification categories for financial assets: measured at amortized cost, fair value through other comprehensive income ("FVOCI") and fair value through profit and loss ("FVTPL").
The classification categories are as follows:
- A financial asset is measured at amortized cost: Financial assets held within a business model whose objective is to hold assets to collect contractual cash flows and its contractual terms give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding. Financial assets measured at amortized cost are measured using the effective interest method. Cash and trade and other receivables are classified as financial assets measured at amortized cost.
- Financial assets at FVOCI: Financial assets held within a business model whose objective is achieved by both collecting contractual cash flows and selling financial assets and its contractual terms give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.
- Financial assets at FVTPL: Financial assets that do not meet the criteria for amortized cost or fair value through other comprehensive income. Transaction costs of financial assets measured at FVTPL are expensed in the consolidated statements of loss and comprehensive loss.
Financial assets are derecognized when the contractual rights to the cash flows from the financial assets expire or when the contractual rights to those assets are transferred.
Financial liabilities – The classification of financial liabilities is determined by the Company at initial recognition. The classification categories are as follows:
Financial liabilities measured at amortized cost: Financial liabilities initially measured at fair value less directly attributable transaction costs and are subsequently measured at amortized cost using the effective interest method. Interest expense is recognized in the consolidated statements of loss and comprehensive loss. Accounts payable and accrued liabilities, credit facility and deferred compensation are classified as financial liabilities measured at amortized cost.
- Financial liabilities measured at FVTPL: Financial liabilities measured a fair value with changes in fair value and interest expense recognized in the consolidated statements of loss and comprehensive loss.
The Company derecognizes a financial liability when its contractual obligations are discharged or cancelled or expire. The Company also derecognizes a financial liability when its terms are modified and the cash flows of the modified liability are substantially different, in which case a new financial liability based on the modified terms is recognized at fair value. On derecognition of a financial liability, the difference between the carrying amount extinguished and the consideration paid (including any non-cash assets transferred or liabilities assumed) is recognized in the consolidated statements of loss and comprehensive loss.
Derivative financial instruments
The Company did not enter into any derivative contracts.
Boardwalktech Software Corp.
Notes to Consolidated Financial Statements
For the years ended March 31, 2025 and 2024
(United States dollars unless otherwise disclosed)
Impairment of financial assets
Impairment of financial assets is based on an expected credit loss (“ECL”) model. ECLs are a probability-weighted estimate of credit losses. The Company calculates lifetime ECLs based on consideration of customer-specific factors, actual credit loss experience and forecasted economic conditions. Management considers historical default rates generally represent a reasonable approximation of future expected defaults and as a percentage of revenue, the Company’s actual credit loss experience has been minor.
Foreign currencies
Transactions in currencies other than the Company’s functional currency are recognized at the rates of exchange prevailing at the dates of the transactions. At the end of each reporting period, monetary items denominated in foreign currencies are translated at the rates prevailing at that date. Non-monetary items carried at fair value that are denominated in foreign currencies are translated at the rates prevailing at the date when the fair value was determined. Non-monetary items that are measured in terms of historical cost in a foreign currency are not translated.
Exchange differences on monetary items are recognized in the consolidated statements of loss and comprehensive loss in the period in which they arise.
The financial results of operations that have a functional currency different from the presentation currency are translated into the presentation currency. Income and expenditures of operations are translated at the average rate of the exchange for the year. All assets and liabilities are translated at the rate of exchange at the reporting date. Differences arising on translation are recognized as other comprehensive income (loss).
Foreign exchanges differences arising on monetary items that form part of the Company’s net investment in foreign subsidiaries are initially recognized in other comprehensive income and reclassified to profit or loss in the statement of comprehensive loss on disposal of the net investment.
Leases
A contract is, or contains, a lease if the contract conveys the right to control the use of an identified asset for a period of time in exchange for consideration. A lease liability is recognized at the commencement of the lease term at the present value of the lease payments that are not paid at that date using the incremental borrowing rate at the lease commencement date if the interest rate implicit in the lease is not readily determinable. At the commencement date, a corresponding right-of-use asset is recognized at the amount of the lease liability, adjusted for lease incentives received, retirement costs and initial direct costs. Depreciation is recognized on the right-of-use asset over the lease term. Interest expense is recognized on the lease liabilities using the effective interest rate method and payments are applied against the lease liability.
The Company applies the practical expedients for short-term and low-value leases whereby related lease payments are recognized as expenses in the period incurred.
Revenue recognition
The Company’s revenue is generated from two primary sources: (1) software subscriptions and services and (2) professional services.
Software subscriptions and services
Software subscriptions and services revenue consists primarily of licensing agreements for software (“License and Software Service Agreements”) written by the Company. This includes the Company’s collaborative enterprise digital ledger data management technology platform offered as either a cloud-based platform service that runs industry, or customer specific applications, BAE or BEB platforms. Customers pay a lump-sum upfront fee for the use of the Company’s software licenses and services over a specified term. These revenues are deferred and recognized monthly on the first day of the month that the contract commences over the term of the License and Software Service Agreement. License and Software Service Agreements generally have automatic renewals and do not offer the unilateral right to terminate or cancel the contract and receive a cash refund.
License and Software Service Agreements can also include dedicated server hosting revenue for customers who choose to prepay server hosting fees for 12 months and the related revenues are deferred and recognized monthly on the first day of the month that the contract commences over the term of the dedicated server hosting contract.
In addition, maintenance services are typically included in License and Software Service Agreements. However, in some cases, customers pay for supplemental or additional maintenance services under a separate contract. In these cases, customers prepay maintenance fees for 12 months and the related maintenance revenues are deferred and recognized monthly on the first day of the month that the contract commences over the term of the maintenance contract. Maintenance contracts include the right to unspecified upgrades on a when-and-if available basis, and ongoing support.
Revenue from software subscriptions and services is recognized as a series of distinct obligations over the specified term, for the right to access or transfer of promised services to the customers in an amount that reflects the consideration the Company expects to receive in exchange for those services. The Company’s contracts often include a number of
Boardwalktech Software Corp.
Notes to Consolidated Financial Statements
For the years ended March 31, 2025 and 2024
(United States dollars unless otherwise disclosed)
promised services such as software licenses and services, dedicated server hosting and maintenance services. The Company's services are generally distinct and accounted for as separate performance obligations. A service is distinct if the customer can benefit from it on its own or together with other readily available resources, and the Company's promise to transfer the service is separately identifiable from other promises in the contractual arrangement with the customer.
Software subscriptions and services revenue includes two categories: (i) recurring software subscription revenues (SaaS), which are derived from customers accessing the Company's cloud services and (ii) legacy supplemental hosting and premium maintenance services contracts which include additional services beyond the standard support that is included in the basic subscription fees.
Professional services
Professional services revenue consists of consulting, training and contract customization activities, and ad hoc engagements where the Company's experts consult and write specific applications that run on the BAE platform or the BEB platform, enabling and automating business collaboration and multi-party information exchange. These arrangements can be executed through various means including a statement of work ("SOW") or period-based agreements as hours or services are incurred. Revenue from professional services is recognized at a point in time when the distinct and separate professional and consulting services are rendered to and accepted by the customer, and the payments associated with those completed and accepted professional service are non-refundable.
The Company recognizes an asset for the incremental costs of obtaining a contract with a customer if it expects the costs to be recoverable. Capitalized contract acquisition costs are amortized consistent with the pattern of transfer of the services to which the asset relates. The amortization period includes anticipated contract renewals where there is either no renewal commission or a renewal commission that is not commensurate with the initial commission. The Company does not capitalize incremental costs of obtaining contracts if the amortization period is one year or less. The Company does not have any incremental costs meeting capitalization criteria.
The Company does not adjust the total consideration over the contract term for the effect of a financing component if the period between the transfer of services to the customer and the customer's payment for these services is expected to be one year or less.
Amounts billed and collected in accordance with customer contracts but not yet earned are recorded and presented as deferred revenue.
Cost of sales
Cost of sales includes direct costs and labor related to the rendering of services. The Company's data centre related costs are expensed to cost of sales per service contracts with cloud hosting partners. Fees are paid monthly and the services can be cancelled at any time with advance notice.
Employee benefits
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 if the Company 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.
Share-based payment arrangements
Equity-settled share-based payments to employees and others providing similar services are measured at the fair value of the equity instruments at the grant date using the Black-Scholes pricing model.
The fair value determined at the grant date of the equity-settled share-based payments is recognized as share-based payment expense, with a corresponding increase in contributed surplus, over the vesting period, based on the Company's estimate of equity instruments that will eventually vest. At the end of each reporting period, the Company revises its estimate of the number of equity instruments expected to vest. The impact of the revision of the original estimates, if any, is recognized in the consolidated statements of loss and comprehensive loss such that the cumulative expense reflects the revised estimate, with a corresponding adjustment to the equity-settled employee benefits reserve.
Equity-settled share-based payment transactions with parties other than employees are measured at the fair value of the services received, except where that fair value cannot be estimated reliably, in which case they are measured at the fair value of the equity instruments granted, measured at the date the counterparty renders the service.
The fair value of RSUs is estimated based on the market value of the Company's shares on the date of grant.
Upon exercise of equity instruments, the consideration received plus the amount previously recorded in contributed surplus is recorded as an increase to share capital.
Boardwalktech Software Corp.
Notes to Consolidated Financial Statements
For the years ended March 31, 2025 and 2024
(United States dollars unless otherwise disclosed)
Taxation
Tax expense represents the sum of the tax currently payable and deferred tax.
Current tax
The tax currently payable is based on taxable profit for the year. Taxable profit differs from profit as reported in the consolidated statements of loss and comprehensive loss because of items of income or expense that are taxable or deductible in other years and items that are never taxable or deductible. The Company's liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the end of the reporting period.
Deferred tax
Deferred tax is recognized using the liability method based on temporary differences between the carrying amounts of assets and liabilities in the consolidated financial statements and the corresponding tax bases used in the computation of taxable profit. Deferred tax liabilities are generally recognized for all taxable temporary differences. Deferred tax assets are generally recognized for all deductible temporary differences to the extent that it is probable that taxable profits will be available against which those deductible temporary differences can be utilized.
The carrying amount of deferred tax assets is reviewed at the end of each reporting period and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered.
Deferred tax assets and liabilities are measured at the tax rates that are expected to apply in the period in which the liability is settled or the asset realized, based on tax rates and tax laws that have been enacted or substantively enacted by the end of the reporting period. The measurement of deferred tax liabilities and assets reflects the tax consequences that would follow from the manner in which the Company expects, at the end of the reporting period, to recover or settle the carrying amount of its assets and liabilities.
Current and deferred tax for the period
Current and deferred tax are recognized in the consolidated statements of loss and comprehensive loss, except when they relate to items that are recognized in other comprehensive loss or directly in equity, in which case the current and deferred tax are also recognized in other comprehensive loss or directly in equity respectively.
Share capital
Common shares are classified as equity. The Company may issue common share warrants as part of a unit issuance comprised of a common share and common share warrant or issued as a share issue cost. Consideration received on the sale of a unit is allocated, within equity, to the respective share capital or contributed surplus categories on a residual value basis. The more readily determinable fair value of common shares is measured on the date of issuance based on the market price on such date with the residual amount allocated to warrants and recorded to contributed surplus. Warrants issued as a share issue cost are valued using the Black-Scholes pricing model, taking into account the terms and conditions upon which the warrants were issued. Warrants are not subsequently re-measured for changes in fair value. Incremental costs directly attributable to the issuance of common shares are recognized as a deduction from equity. Upon the exercise of warrants, consideration received along with the related fair value amount transferred from contributed surplus is recorded as share capital.
Earnings (loss) per share
Basic earnings (loss) per share is calculated by dividing the net income or loss attributable to equity holders of the Company by the weighted average number of common shares outstanding during the year.
Diluted earnings (loss) per share is calculated by dividing the profit attributable to equity holders of the Company by the weighted average number of common shares outstanding, adjusted for the effects of all dilutive potential equity instruments. The weighted average number of common shares outstanding is increased by the total number of additional common shares that would have been issued by the Company assuming exercise of all common share warrants and stock options with exercise prices below the average market price for the year.
Segmented information
The Company reports segment information based on internal reports used by the chief operating decision maker ("CODM") to make operating and resource decisions and to assess performance. The CODM is the Chief Executive Officer of the Company. The CODM makes decisions and assesses performance of the Company on a consolidated basis such that the Company is a single reportable operating segment. For the years ended March 31, 2025 and 2024, all revenues generated by the Company were earned through their operations based in the United States (Note 11). For the years ended March 31, 2025 and 2024, all property and equipment and right-of-use assets were held by the Company's subsidiaries in the United States and India (Note 6).
Boardwalktech Software Corp.
Notes to Consolidated Financial Statements
For the years ended March 31, 2025 and 2024
(United States dollars unless otherwise disclosed)
Amended IFRS not yet adopted
The Company has reviewed new and amended accounting pronouncements that have been issued but are not yet effective and determined that the following amendments are applicable to the Company but are not expected to have a material impact to reported amounts and balances:
IFRS 9 Financial Instruments and IFRS 7 Financial Instruments: Disclosures
Effective for the Company on April 1, 2026, amendments to IFRS 9 and IFRS 7 provide:
- clarifications to the "solely payments of principal and interest" test to ensure consistent application while maintaining the principle-based approach;
- refinements to the treatment of modifications to financial assets and liabilities upon derecognition;
- guidance for the treatment of financial liabilities settled through electronic payment systems; and
- additional IFRS 7 disclosure requirements to support classification and measurement rules, including derecognition.
IFRS 18 Presentation and Disclosure in Financial Statements
Issued in April 2024 and effective for the Company on April 1, 2027, IFRS 18 provides guidance to enhance transparency and comparability in financial reporting by introducing requirements for the structured presentation of profit or loss, aggregation and disaggregation of financial data, disclosures of management-defined performance measures ("MPMs") and clarity in the classification of operating, investing, and financing activities in the statement of cash flows. New disclosures must reconcile MPMs to IFRS measures, explaining their relevance and calculation.
4. Accounting Estimates and Judgments
In the application of the Company's accounting policies, management is required to make judgments and estimates that affect the carrying amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements, and the reported amounts of revenues and expenses for the periods presented. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant, the results of which form the basis of the valuation of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognized in the year in which the estimate is revised if the revision affects only that year or in the year of the revision and future years if the revision affects both current and future years.
Estimates
Critical accounting estimates are those that require management to make assumptions about matters that are highly uncertain at the time the estimate or assumption is made. Critical accounting estimates are also those that could potentially have a material impact on the Company's financial results where a different estimate or assumption is used. The significant areas of estimation uncertainty are:
Expected credit losses
The Company's trade and other receivables are typically short-term in nature, as payment for License and Software Service Agreements is prepaid at the beginning of the license term, and the Company recognizes an amount equal to the lifetime ECL based on a probability-weighted matrix. The Company measures ECLs based customer-specific factors, historical default rates and forecasted economic conditions. The amount of ECLs is sensitive to changes in circumstances of forecast economic conditions.
Revenue recognition
Where the outcome of performance obligations for contracts can be estimated reliably, revenue is recognized. The Company recognizes revenue when obligations have been satisfied and, where such provisions exist, the Company does not begin revenue recognition for license subscriptions that have conditional or trial periods until such periods expire. Where the outcome of performance obligations for sales contracts cannot be reliably measured, contract revenue is recognized in the current year to the extent that costs have been incurred until such time that the outcome of the performance obligations can be reasonably measured. Significant estimation assumptions are required to estimate total contract costs, which are recognized as expenses in the year in which they are incurred. When it is probable that total contract costs will exceed total contract revenue, the expected loss is recognized as an expense immediately.
Leases
Lease terms are based on assumptions regarding extension terms that allow for operational flexibility and future market conditions.
Boardwalktech Software Corp.
Notes to Consolidated Financial Statements
For the years ended March 31, 2025 and 2024
(United States dollars unless otherwise disclosed)
Share-based payments
Equity-settled share-based payments to employees and others providing similar services are measured at the fair value of the equity instruments at the grant date. Determining the fair value of such share-based awards granted as common share warrants and stock options requires estimate as to the appropriate valuation model (Black-Scholes pricing model) and the inputs for the model require assumptions including the rate of forfeiture of warrants or options granted, the expected life of the warrant or option, the Company's share price and its expected volatility, the risk-free interest rate and expected dividends. RSUs are valued based on the market price of the Company's shares at the time of grant.
Deferred taxes
Deferred taxes are based on estimates as to the timing of the reversal of temporary and taxable differences, substantively enacted tax rates and the likelihood of assets being realized.
Judgments
Judgment is used in situations when there is a choice and/or assessment required by management. The following are critical judgments apart from those involving estimations, that management has made in the process of applying the Company's accounting policies and that have a significant effect on the amounts recognized in the consolidated financial statements.
Going concern
The going concern assessment requires management's judgment on the ability of the Company to achieve positive cash flow from operations and/or obtain necessary equity or other financing to increase the number of licensed customers and continue with expansion in the digital ledger market.
Leases
The incremental borrowing rates are based on judgments including economic environment, term, currency, and the underlying risk inherent to the asset. The carrying balance of the right-of-use assets, lease liabilities, and the resulting interest expense and depreciation expense, may differ due to changes in the market conditions and lease term.
Contingencies
Management uses judgment to assess the existence of contingencies. By their nature, contingencies will only be resolved when one or more future events occur or fail to occur. Management also uses judgment to assess the likelihood of the occurrence of one or more future events.
Taxation
The calculations for current and deferred taxes require management's interpretation of tax regulations and legislation in the various tax jurisdictions in which the Company operates, which are subject to change. The measurement of deferred tax assets and liabilities requires estimates of the timing of the reversal of temporary differences identified and management's assessment of the Company's ability to utilize the underlying future tax deductions against future taxable income before they expire, which involves estimating future taxable income.
The Company is subject to assessments by various taxation authorities in the tax jurisdictions in which it operates and these taxation authorities may interpret the tax legislation and regulations differently. In addition, the calculation of income taxes involves many complex factors. As such, income taxes are subject to measurement uncertainty and actual amounts of taxes may vary from the estimates made by management.
5. Trade and Other Receivables
The Company's trade and other receivables are exposed to the risk of financial loss if the counterparty fails to meet its contractual obligations. Trade and other receivables credit exposure is minimized by entering into transactions with creditworthy counterparties and monitoring the age and balances outstanding on an ongoing basis. Most of the Company's credit exposures are with counterparties in the consulting and technology industries and are subject to normal industry credit risk. Payment terms with customers are 30 days from invoice date.
The Company's maximum exposure to credit risk at March 31, 2025 is in respect of $600,073 (2024 – $444,880) of trade and other receivables. The Company's trade and other receivables consist of:
| As at March 31 | 2025 | 2024 |
|---|---|---|
| Trade receivables for professional services | 155,880 | 72,880 |
| Receivables from contracts with customers | 444,193 | 372,000 |
| 600,073 | 444,880 |
As at March 31, 2025, four customers accounted for 70% of trade and other receivables (2024 – four customers; 88%), each with balances greater than 10%.
Boardwalktech Software Corp.
Notes to Consolidated Financial Statements
For the years ended March 31, 2025 and 2024
(United States dollars unless otherwise disclosed)
The Company's trade and other receivables are aged as follows:
| As at March 31 | 2025 | 2024 |
|---|---|---|
| Current 0 to 30 days | 586,993 | 373,420 |
| Past due for greater than 90 days | 13,080 | 71,460 |
| 600,073 | 444,880 |
As at March 31, 2025, the Company evaluated the collectability of trade and other receivables and lifetime expected credit losses and recognized $15,000 (2024 – $27,000) provision for expected credit losses. The assessment of expected credit losses due to doubts of collectability resulted in the recognition of a $12,000 reduction in the allowance for credit losses.
6. Right-Of-Use Assets
The Company has recognized right-of-use ("ROU") assets and corresponding lease liabilities (Note 10) related to office premises. The ROU assets are depreciated on a straight-line basis over the term of the related lease.
| United States | India | Total | |
|---|---|---|---|
| Carrying amount, March 31, 2023 | 91,775 | 8,611 | 100,386 |
| Addition (Note 10) | 907,590 | 101,834 | 1,009,424 |
| Depreciation | (273,295) | (36,640) | (309,935) |
| Foreign exchange translation | - | (1,326) | (1,326) |
| Carrying amount, March 31, 2024 | 726,070 | 72,479 | 798,549 |
| Depreciation | (272,280) | (32,986) | (305,266) |
| Foreign exchange translation | - | (1,426) | (1,426) |
| Carrying amount, March 31, 2025 | 453,790 | 38,067 | 491,857 |
During the year ended March 31, 2025, the Company recognized $309,599 of depreciation expense comprised of $305,266 for ROU assets and $4,333 for property and equipment (2024 – $321,075 of depreciation expense comprised of $309,935 for ROU assets and $11,140 for property and equipment).
7. Accounts Payable and Accrued Liabilities
| As at March 31 | 2025 | 2024 |
|---|---|---|
| Accounts payable (United States) | 617,807 | 377,769 |
| Accounts payable (India) | 204,083 | 173,484 |
| Total accounts payable | 821,890 | 551,253 |
| Accrued liabilities (United States) | 91,095 | 91,779 |
| 912,985 | 643,032 |
8. Credit Facility
On March 28, 2024, the Company secured a three-year $4 million credit facility with Celtic Bank, for which the available amount is based 60% of trailing 12-month annual recurring revenue. The credit facility matures on March 27, 2027, at which time the principal amount plus any unpaid interest is due in full and requires interest-only payments during the initial three-year term at an initial interest rate of 12.5% based on the prime rate plus 4%. In connection with the credit facility, the Company paid $187,441 of fees which have been net against the credit proceeds and are amortized over the term of the credit facility.
| As at March 31 | 2025 | 2024 |
|---|---|---|
| Balance, beginning of year | 2,250,000 | - |
| Proceeds | 3,167,980 | 2,437,441 |
| Repayment | (2,859,014) | - |
| Credit facility fees paid | - | (187,441) |
| Amortization of credit facility fees | 63,051 | - |
| Balance, end of year | 2,622,017 | 2,250,000 |
The credit facility agreement requires that the Company maintain "gross working capital" of at least $500,000 at all times, measured quarterly. Gross working capital, for the purposes of the financial covenant, is defined as the sum of (1) cash on
Boardwalktech Software Corp.
Notes to Consolidated Financial Statements
For the years ended March 31, 2025 and 2024
(United States dollars unless otherwise disclosed)
hand plus (2) the borrowing base less the outstanding principal balance of the loan. The financial covenant was not met as at March 31, 2025, however the covenant was cured and accepted by the lender as of June 2, 2025.
During the year ended March 31, 2025, the Company recognized $301,265 (2024 – $2,321) of interest expense on the credit facility of which $273,672 (2024 – $nil) was paid and $24,692 was included in accounts payable and accrued liabilities at March 31, 2025 (2024 – $2,321).
9. Deferred Revenue
| As at March 31 | 2025 | 2024 |
|---|---|---|
| Balance, beginning of year | 1,290,011 | 3,389,875 |
| Invoiced in the year, excluding amount recognized directly in revenue | 3,497,730 | 3,220,862 |
| Amount recognized as revenue | (4,080,326) | (5,320,726) |
| Balance, end of year | 707,415 | 1,290,011 |
10. Lease Liabilities
The Company incurs lease payments related to office premises.
| United States | India | Total | |
|---|---|---|---|
| Balance, March 31, 2023 | 117,100 | 9,966 | 127,066 |
| Lease liability for ROU asset (Note 6) | 907,590 | 101,834 | 1,009,424 |
| Imputed interest | 64,216 | 8,393 | 72,609 |
| Lease payments | (206,267) | (42,436) | (248,703) |
| Lease incentive | (28,057) | - | (28,057) |
| Foreign currency translation | - | (1,343) | (1,343) |
| Balance, March 31, 2024 | 854,582 | 76,414 | 930,996 |
| Imputed interest | 73,342 | 6,031 | 79,373 |
| Lease payments | (349,103) | (38,748) | (387,851) |
| Foreign currency translation | - | (1,535) | (1,535) |
| Balance, March 31, 2025 | 578,821 | 42,162 | 620,983 |
The current and non-current portions of lease liabilities are as follows:
| United States | India | Total | |
|---|---|---|---|
| Balance, March 31, 2025 | 578,821 | 42,162 | 620,983 |
| Current portion | (315,732) | (37,435) | (353,167) |
| Non-current portion | 263,089 | 4,727 | 267,816 |
| United States | India | Total | |
| Balance, March 31, 2024 | 854,582 | 76,414 | 930,996 |
| Current portion | (275,761) | (33,190) | (308,951) |
| Non-current portion | 578,821 | 43,224 | 622,045 |
In May 2023, the Company and its landlord for office premises in India executed an office lease agreement commencing on May 20, 2023 and expiring on May 19, 2026. The Company is required to make lease payments for a minimum of 18 months after which time the Company may terminate the lease with a minimum of three months notice. The lease liability for the India office lease was determined using an incremental borrowing rate of 11% and a lease term of 36 months.
In July 2023, the Company extended its United States office lease for an additional 40 months to November 30, 2026 during which the Company will receive a rent-free period from August 1 to November 30, 2023. The lease liability for the United States office lease was determined using an incremental borrowing rate of 11% and a lease term of 40 months. In connection with the lease extension, the office carpet was to be replaced by a certain date which did not occur. As compensation to the Company, the landlord waived the $28,057 of rent for the month of December 2023.
13
Boardwalktech Software Corp.
Notes to Consolidated Financial Statements
For the years ended March 31, 2025 and 2024
(United States dollars unless otherwise disclosed)
As at March 31, 2025, the annual future undiscounted lease payments under the office lease agreements are as follows:
| United States | India | Total | |
|---|---|---|---|
| Fiscal year ended March 31, 2026 | 359,627 | 39,958 | 399,585 |
| Fiscal year ended March 31, 2027 | 273,599 | 4,778 | 278,377 |
| 633,226 | 44,736 | 677,962 |
11. Revenue
The following table presents the Company's revenue disaggregated by type:
| For the years ended March 31 | 2025 | 2024 |
|---|---|---|
| Software-as-a-service (SaaS) | 3,795,615 | 4,970,027 |
| Legacy (hosting and maintenance) | 284,711 | 343,783 |
| Software subscriptions and services | 4,080,326 | 5,313,810 |
| Professional services | 716,650 | 657,812 |
| Total revenue | 4,796,976 | 5,971,622 |
As at March 31, 2025, trade and other receivables (Note 5) included $432,193 of receivables from software subscriptions and services customers (2024 – $372,000) and $155,880 of receivables from professional services customers (2024 – $72,880).
The Company's revenue is generated in the United States. For the year ended March 31, 2025, 55.5% of the Company's revenue was earned through sales to two major customers (2024 – 67.4% of revenue, two major customers), each with revenues of 10% or greater:
| For the years ended March 31 | 2025 | 2024 |
|---|---|---|
| Customer 1 | 39.2% | 37.7% |
| Customer 2 | 16.3% | 30.0% |
| 55.5% | 67.7% |
12. Nature of Expenses
The nature of the Company's general and administrative expenses is as follows:
| For the years ended March 31 | 2025 | 2024 |
|---|---|---|
| Office | 183,097 | 186,653 |
| Marketing | 99,574 | 149,565 |
| Travel and lodging | 70,735 | 63,597 |
| Rent and utilities | 44,456 | 45,136 |
| Shareholder, regulatory and other | 86,883 | 118,997 |
| 484,745 | 563,948 |
Boardwalktech Software Corp.
Notes to Consolidated Financial Statements
For the years ended March 31, 2025 and 2024
(United States dollars unless otherwise disclosed)
13. Compensation
(a) Key management personnel compensation
The Company defines key management personnel as being the Chief Executive Officer, Chief Financial Officer, and Chief Technical Officer. For the year ended March 31, 2025, key management personnel compensation included in salaries, wages and benefits expense is $623,281 (2024 – $572,286) and in share-based payments expense is $205,668 (2024 – $346,366).
(b) Deferred compensation payable
During the year ended March 31, 2025, the Company recognized $200,262 of deferred compensation (2024 – $282,503) of which $177,762 was payable at March 31, 2025 (2024 – $241,307).
| As at March 31 | 2025 | 2024 |
|---|---|---|
| Balance, beginning of year | 241,307 | – |
| Expense | 200,262 | 282,503 |
| Unit private placement (Notes 15(a) and (d)) | (22,500) | (18,694) |
| Payment | (241,307) | (22,502) |
| Balance, end of year | 177,762 | 241,307 |
(c) Severance costs
During the year ended March 31, 2024, the Company incurred $103,810 of severance costs in connection with a realignment of resources that resulted in the termination of 17 employees.
14. Taxes
The tax provision recorded in the consolidated financial statements differs from the amount computed by applying the combined Canadian federal and provincial income tax statutory rates to loss before tax as follows:
| For the years ended March 31 | 2025 | 2024 |
|---|---|---|
| Loss before taxes | (3,220,288) | (3,109,811) |
| Statutory income tax rate (%) | 22% | 22% |
| Expected recovery at statutory rate | (708,463) | (684,158) |
| Increase (decrease) in taxes resulting from: | ||
| Non-deductible items | 186,488 | 218,613 |
| Impact of tax rate changes | (1,547,069) | – |
| Impact of foreign exchange rate changes | 50,773 | (86,778) |
| Taxable intercompany advances | 221,103 | 282,833 |
| Deferred tax benefits not recognized | 1,816,658 | 292,017 |
| Tax expense | 19,490 | 22,527 |
The Company's deferred tax assets (liabilities) are as follows:
| 2025 | 2024 | |
|---|---|---|
| Tax difference on leased assets | (140,294) | (182,924) |
| Lease liability recognized | 140,294 | 182,924 |
| Net deferred tax liability | – | – |
The Company has not recognized a deferred tax asset in respect of the following deductible temporary differences:
| United States | 2025 | 2024 |
|---|---|---|
| Net operating losses | 18,558,700 | 16,043,760 |
| Research and development expenditures | 5,313,303 | 1,986,240 |
| Tax credit carryforward | 213,789 | 213,789 |
| Lease liability | 125,031 | 128,511 |
| Accrual to cash timing differences | 783,741 | 2,393,257 |
| Total deductible temporary differences – United States | 24,994,564 | 20,765,557 |
Boardwalktech Software Corp.
Notes to Consolidated Financial Statements
For the years ended March 31, 2025 and 2024
(United States dollars unless otherwise disclosed)
The Company has net operating losses of approximately $18,558,700 which are available to reduce future years' taxable income in the United States. The net operating losses will commence to expire in fiscal 2032. Deferred tax assets are recorded only to the extent that future taxable income will be available against which the deferred tax asset can be offset. Management estimates future income using forecasts based on the best available current information. Based on the current estimates, no deferred tax asset has been recorded.
15. Share Capital
Authorized: Unlimited number of voting common shares
| Issued: | Number of Shares | Amount ($) |
|---|---|---|
| Common shares | ||
| Balance, March 31, 2023 | 48,100,998 | 42,583,679 |
| Unit private placement (a)(b) | 7,521,578 | 1,468,170 |
| Share issue costs (c) | (180,285) | |
| Balance, March 31, 2024 | 55,622,576 | 43,871,564 |
| Unit private placement (d) | 8,826,573 | 767,912 |
| Share issue costs (e) | (57,142) | |
| Balance, March 31, 2025 | 64,449,149 | 44,582,334 |
(a) On December 28, 2023, the Company completed the private placement of 7,015,353 units at a price of CAD 0.30 per unit for gross proceeds of $1,590,738 (CAD 2,104,606). Each unit is comprised of one common share and one common share purchase warrant exercisable at a price of CAD 0.50 per share for a period of three years from the date of issuance, subject to early acceleration by the Company if the trading price of the Company's common shares is greater than CAD 1.00 for 10 consecutive trading days.
Of the gross proceeds, $113,535 (CAD 150,000) was by way of a direction-to-pay a vendor for prepaid trade show fees and $28,971 (CAD 39,506) was through a $10,277 offset of accounts payable and $18,694 of deferred compensation (Note 13(b)) due to an officer of the Company.
Gross proceeds from the sale of units has been allocated to the respective equity instruments whereby $1,378,341 (CAD 1,823,992) of fair value has been assigned to common shares at a market price of CAD 0.26 per share on the date of issue, with the remaining $212,397 (CAD 280,614) allocated to the warrants (CAD 0.04 per warrant).
(b) On February 26, 2024, the Company issued 506,225 units for gross proceeds of $112,303 (CAD 151,868) pursuant to the closing of the second and final tranche of the unit private placement disclosed in Note 15(a).
Gross proceeds from the sale of units was allocated to the respective equity instruments based whereby $89,829 (CAD 121,494) of fair value has been assigned to common shares at a market price of CAD 0.24 per share on the date of issue, with the remaining $22,474 (CAD 30,374) allocated to the warrants (CAD 0.06 per warrant).
(c) In connection with the December 28, 2023 and February 26, 2024 private placements, the Company paid $90,127 of commissions to qualified non-related parties, issued 397,765 finders' warrants exercisable at a price of CAD 0.50 per share for a period of three years from the date of issuance and incurred $64,952 of other cash issuance costs.
Finders' warrants have been recorded at their estimated $25,206 (CAD 33,370) issue date fair value using the Black-Scholes pricing model based on the following assumptions:
| Share price | CAD 0.24 – 0.26 | Exercise price | CAD 0.50 |
|---|---|---|---|
| Expected volatility | 69% – 72% | Expected dividend yield | 0% |
| Expected life | 3 years | Risk-free interest rate | 3.71% – 3.96% |
(d) On March 14, 2025, the Company closed the initial tranche of a non-brokered private placement of 8,576,573 units at a price of CAD 0.13 per unit for gross proceeds of $776,008 (CAD 1,114,954). Concurrently, the Company issued 250,000 units at a price of $0.09 (CAD 0.13) per unit to the Company's Chief Executive Officer as settlement of $22,500 of deferred compensation (Note 13(b)). Each unit is comprised of one common share and one common share purchase warrant exercisable at a price of CAD 0.25 per share for a period of one year from the date of issuance.
Gross proceeds from the sale of units was allocated to the respective equity instruments whereby $767,912 (CAD 1,103,322) of fair value has been assigned to common shares at a market price of CAD 0.125 per share on the date of issue, with the remaining $30,596 (CAD 43,960) allocated to the warrants (CAD 0.005 per warrant).
(e) In connection with the March 14, 2025 private placement, the Company paid $28,059 of commissions to qualified non-related parties, issued 308,996 finders' warrants exercisable at a price of CAD 0.25 per share for a period of one year from the date of issuance and incurred $20,493 of other cash issuance costs.
16
Boardwalktech Software Corp.
Notes to Consolidated Financial Statements
For the years ended March 31, 2025 and 2024
(United States dollars unless otherwise disclosed)
Finders' warrants have been recorded at their estimated fair value of $8,590 (CAD 12,352) issue date fair value using the Black-Scholes pricing model based on the following assumptions:
| Share price | CAD 0.125 | Exercise price | CAD 0.25 |
|---|---|---|---|
| Expected volatility | 131% | Expected dividend yield | 0% |
| Expected life | 1 year | Risk-free interest rate | 2.57% |
- Warrants
| Number of Warrants | Weighted Average Exercise Price (USD Equivalent) (1) | |
|---|---|---|
| Balance, March 31, 2023 | 319,540 | 1.67 |
| Expired | (319,540) | (1.67) |
| Unit warrants issued (Note 15(a) and (b)) | 7,521,578 | 0.35 |
| Finders' warrants issued (Note 15(c)) | 397,765 | 0.35 |
| Balance, March 31, 2024 | 7,919,343 | 0.35 |
| Issued (a) | 810,810 | 0.14 |
| Issued (Note 15(d)) | 8,826,573 | 0.17 |
| Finders' warrants issued (Note 15(e)) | 308,996 | 0.17 |
| Balance, March 31, 2025 | 17,865,722 | 0.25 |
(1) Translated to CAD at the March 31, 2025 USD exchange rate.
(a) On November 8, 2024, the Company issued 810,810 warrants to a financial advisor who elected to receive a $15,000 consulting fee in the form of warrants in lieu of cash. The warrants are exercisable at CAD 0.20 per share and expire on November 8, 2029. The estimated fair value of the warrants was determined to be $67,000 resulting in the recognition of a $52,000 loss on debt settlement.
The Black-Scholes pricing model used to estimate the fair value of the warrants was based on the following assumptions:
| Share price | CAD 0.18 | Exercise price | CAD 0.20 |
|---|---|---|---|
| Expected volatility | 80% | Expected dividend yield | 0% |
| Expected life | 5 years | Risk-free interest rate | 3.07% |
Information about the Company's warrants outstanding as at March 31, 2025 is summarized in the following table:
| Expiry Date | Number of Warrants Outstanding | Weighted Average Exercise Price | Weighted Average Life Remaining (Years) |
|---|---|---|---|
| March 14, 2026 | 9,135,569 | 0.17 (1) | 1.0 |
| December 28, 2026 | 7,375,246 | 0.35 (2) | 1.7 |
| February 26, 2027 | 544,097 | 0.35 (2) | 1.9 |
| November 8, 2029 | 810,810 | 0.14 (3) | 4.6 |
| 17,865,722 | 0.25 | 1.5 |
(1) CAD 0.25, the USD equivalent of which is $0.17 on March 31, 2025.
(2) CAD 0.50, the USD equivalent of which is $0.35 on March 31, 2025.
(3) CAD 0.20, the USD equivalent of which is $0.14 on March 31, 2025.
17. Share-Based Payments
The Company has established an equity incentive plan (the "Equity Incentive Plan") administered by the Company's Board of Directors (the "Board") which provides for the grant of incentive stock awards, including incentive stock options, non-statutory stock options, stock appreciation rights, restricted stock awards, restricted stock unit awards and other awards based on common stock. Under the Equity Incentive Plan, these awards are available to employees, consultants, and directors of the Company. All awards granted under the Equity Incentive Plan are governed by an award agreement and vest in accordance with the vesting schedule set forth in such award agreement, which may be accelerated upon a change of control. The exercise price for awards granted under the Equity Incentive Plan shall be fixed by the Board and shall not be less than the Discounted Market Price (as defined in the policies of the TSX Venture Exchange (the "TSXV"), or such other price as permitted pursuant to a waiver obtained from the TSXV, of common shares on the effective date of grant; provided however, that no award granted to a participant holding 10% or more of the Company's common shares shall have an exercise price per common share that is less than one hundred ten percent (110%) of the market price of the Company's
Boardwalktech Software Corp.
Notes to Consolidated Financial Statements
For the years ended March 31, 2025 and 2024
(United States dollars unless otherwise disclosed)
common shares on the effective date of grant. The term of each award shall be fixed by the Board, but no award shall be exercisable more than ten years after the date the award is granted. In the case of an award that is granted to a participant who, on the grant date, owns 10% of the voting power of all classes of the Company's shares, the term of such award shall be no more than five years from the date of grant.
As at March 31, 2025, the maximum number of common shares which are reserved and set aside for issuance upon the grant or exercise of awards under the Equity Incentive Plan is 9,620,200 common shares. This number is subject to adjustment in the event of a stock split, stock dividend or other changes in the Company's capitalization.
Stock options:
| Number of Options | Weighted Average Exercise Price | |
|---|---|---|
| Balance, March 31, 2023 | 818,915 | 1.56 |
| Expired | (173,915) | (0.44) |
| Forfeited | (250,000) | (2.00) |
| Balance, March 31, 2024 | 395,000 | 1.77 |
| Granted | 500,000 | 0.10 (1) |
| Forfeited | (10,000) | (0.44) |
| Balance, March 31, 2025 | 885,000 | 0.84 |
On October 9, 2024, the Company entered into an investor relations agreement for an initial term of 12 months for a monthly fee of CAD 8,000 and 500,000 stock options. The stock options are exercisable at CAD 0.14 per share, vest 25% every three months following the grant date and expire on October 9, 2029. The issue date fair value of the stock options was estimated to be $32,520 (CAD 44,520) using the Black-Scholes pricing model based on the following assumptions:
| Share price | CAD 0.14 | Exercise price | CAD 0.14 |
|---|---|---|---|
| Expected volatility | 80% | Expected dividend yield | 0% |
| Expected life | 5 years | Risk-free interest rate | 3.07% |
| Forfeiture rate | 3% |
Information about the Company's stock options outstanding and exercisable as at March 31, 2025 is summarized in the following table:
| Expiry Date | Outstanding | Weighted Average Exercise Price | Weighted Average Life Remaining (Years) | Exercisable |
|---|---|---|---|---|
| January 28, 2026 | 40,000 | 0.44 | 0.8 | 40,000 |
| April 26, 2026 | 7,500 | 0.44 | 1.1 | 7,500 |
| February 10, 2028 | 337,500 | 2.00 | 2.9 | 337,500 |
| October 9, 2029 | 500,000 | 0.10 (1) | 4.5 | 125,000 |
| 885,000 | 0.84 | 3.7 | 510,000 |
(1) CAD 0.14, the USD equivalent of which is $0.10 on March 31, 2025.
RSUs:
| Number | |
|---|---|
| Balance, March 31, 2023 | 3,964,450 |
| Granted | 2,245,000 |
| Forfeited | (521,875) |
| Balance, March 31, 2024 | 5,687,575 |
| Granted | 2,671,300 |
| Balance, March 31, 2025 | 8,358,875 |
| Vested, March 31, 2025 | 3,793,007 |
On August 31, 2023, the Company granted 2,245,000 RSUs to officers, directors and employees of the Company, of which 748,324 RSUs vest on August 31, 2024, 748,324 RSUs vest on August 31, 2025, and 748,352 RSUs vest on August 31, 2026. The grant date fair value of these RSUs was determined to be $738,610 based on the $0.33 (CAD 0.445) market price of the Company's common shares on the grant date.
On August 31, 2024, the Company granted 2,671,300 RSUs to officers, directors and employees of the Company, of which 890,424 RSUs vest on August 31, 2025, 890,424 RSUs vest on August 31, 2026, and 890,452 RSUs vest on August 31,
Boardwalktech Software Corp.
Notes to Consolidated Financial Statements
For the years ended March 31, 2025 and 2024
(United States dollars unless otherwise disclosed)
- The grant date fair value of these RSUs was determined to be $178,980 based on the $0.07 (CAD 0.09) market price of the Company's common shares on the grant date.
RSUs entitle participants the conditional right to receive one common share of the Company for each share unit.
Vesting information for RSUs outstanding at March 31, 2025 is summarized below:
| Vesting Date | Number of RSUs |
|---|---|
| February 28, 2023 | 58,331 |
| August 31, 2023 | 1,799,812 |
| February 28, 2024 | 197,997 |
| August 31, 2024 | 1,638,863 |
| February 28, 2025 | 98,004 |
| August 31, 2025 | 2,097,041 |
| February 28, 2026 | 40,001 |
| August 31, 2026 | 1,538,374 |
| August 31, 2027 | 890,452 |
| 8,358,875 |
Share-based payments expense:
During the year ended March 31, 2025, the Company recognized $603,158 (2024 – $1,006,914) of share-based payment expense in respect of stock options and RSUs. As at March 31, 2025, the remaining unvested balance of share-based payments was $334,425.
18. Per Share Amounts
| For the years ended March 31 | 2025 | 2024 |
|---|---|---|
| Net loss | (3,239,778) | (3,132,338) |
| Basic and diluted weighted average number of shares | 56,033,677 | 49,949,781 |
| Basic and diluted net loss per share | (0.06) | (0.06) |
For the years ended March 31, 2025 and 2024, all warrants, stock options and RSUs were excluded from the diluted per share amounts as their effect is anti-dilutive.
19. Financial Instruments and Risk Management
The Company's activities expose it to a variety of financial risks. The Company is exposed to credit risk and liquidity risk because of holding certain financial instruments. The Company is exposed to market risks related to financial instruments denominated in foreign currencies. The Company's overall risk management program focuses on the unpredictability of financial markets and seeks to minimize potential adverse effects on the Company's financial performance.
Risk management is carried out by senior management, with oversight governance by the Board of Directors.
Fair value
The Company's financial instruments consist of cash, trade and other receivable, accounts payable and accrued liabilities, credit facility and deferred compensation. The carrying amounts of current financial instrument items approximate their fair value due to their short period to maturity.
Fair value represents the price at which a financial instrument could be exchanged in an orderly market, in an arm's length transaction between knowledgeable and willing parties who are under no compulsion to act. The Company classifies the fair value of the financial instruments according to the following hierarchy based on the amount of observable inputs used to value the instrument.
Level 1: Fair value measurements are those derived from quoted prices (unadjusted) in an active market for identical assets or liabilities. Active markets are those in which transactions occur in sufficient frequency and volume to provide pricing information on an ongoing basis.
Level 2: Fair value measurements are those derived from inputs other than quoted prices in active markets. Prices are either directly or indirectly observable as of the reporting date and are based on inputs, including quoted forward rates for interest rate, time value and volatility factors, which can be substantially observed or corroborated in the marketplace.
Boardwalktech Software Corp.
Notes to Consolidated Financial Statements
For the years ended March 31, 2025 and 2024
(United States dollars unless otherwise disclosed)
Level 3: Fair value measurements are those derived from valuation techniques that include inputs for the asset or liability that are not based on observable market data.
Credit risk
Credit risk arises when one party to a financial instrument will cause a financial loss for the other party by failing to discharge its obligation. Financial instruments that subject the Company to credit risk consist primarily of cash and trade and other receivables. The credit risk relating to cash balances is limited because the counterparties are large commercial banks in the United States, Canada and India. The amounts reported for trade and other receivables in the consolidated statements of financial position are net of allowances for credit losses and bad debts. As at March 31, 2025, the Company's maximum exposure to credit risk with respect to cash and trade and other receivables is $958,583.
Trade and other receivables (Note 5) credit exposure is minimized by entering into transactions with creditworthy counterparties, invoicing only after the customer's written acceptance of completed work, and monitoring the age and balances outstanding on an ongoing basis. Most of the Company's credit exposures are with counterparties in the consulting and technology industries and are subject to normal industry credit risk. Payment terms with customers are 30 days from invoice date.
Liquidity risk
Liquidity risk is the risk that the Company will not be able to meet its financial obligations as they fall due. The Company generally relies on funds generated from operations, acquisitions and/or equity financing to provide sufficient liquidity to meet budgeted operating requirements.
As at March 31, 2025, maturities of the Company's financial liabilities are as follows:
| Carrying amount | Contractual cash flows | Within 1 year | 2 years | |
|---|---|---|---|---|
| Accounts payable and accrued liabilities (Note 7) | 912,985 | 912,985 | 912,985 | – |
| Credit facility (Note 8) | 2,622,017 | 2,746,407 | – | 2,746,407 |
| Lease liability (Note 10) | 620,983 | 677,962 | 399,585 | 278,377 |
| Deferred compensation (Note 13(b)) | 177,762 | 177,762 | 177,762 | – |
| 4,333,747 | 4,515,116 | 1,490,332 | 3,024,784 |
The Company has current assets of $1,180,625 to satisfy its financial liabilities to satisfy liabilities as they come due. See Note 1 and Note 21.
Foreign currency risk
Foreign currency risk is defined as the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in foreign exchange rates. The Company maintains cash balances and enters into transactions denominated in foreign currencies, principally in INR and CAD, which exposes the Company to fluctuating balances and cash flows due to variations in foreign exchange rates.
The USD equivalent carrying amounts of the Company's foreign denominated monetary assets and monetary liabilities is follows:
| As at March 31 | 2025 | 2024 |
|---|---|---|
| Cash | 9,870 | 15,151 |
| Accounts payable and accrued liabilities | (204,083) | (173,484) |
| Lease liability | (42,162) | (76,414) |
| Net monetary liabilities | (236,375) | (234,747) |
Assuming all other variables remain constant, a fluctuation of $+/- 5.0\%$ in the exchange rate between the USD and foreign currencies would increase or decrease net loss for the year by approximately $11,820 (2024 - $11,740). To date, the Company has not entered into financial derivative contracts to manage exposure to fluctuations in foreign exchange rates.
Interest rate risk
The Company is not exposed to interest rate risk as there are no investments of excess cash in short-term money market investments at variable rates of interest. The credit facility (Note 8) bears interest based on the prime rate plus $4\%$. A $1\%$ increase/decrease in the prime rate of interest would increase/decrease interest expense and net loss for the year ended March 31, 2025 by approximately $6,420 (2024 – a nominal amount).
20
Boardwalktech Software Corp.
Notes to Consolidated Financial Statements
For the years ended March 31, 2025 and 2024
(United States dollars unless otherwise disclosed)
20. Capital Management
The Company's objectives when managing capital are to:
- Deploy capital to provide an appropriate return on investment to its shareholders;
- Maintain financial flexibility in order to preserve the Company's ability to meet financial obligations; and
- Maintain a capital structure that provides financial flexibility to execute on strategic opportunities.
The Company's strategy is formulated to maintain a flexible capital structure consistent with the objectives as stated above and to respond to changes in economic conditions and the risk characteristics of the underlying assets. The Board of Directors does not establish quantitative return on capital criteria for management but rather promotes year-over-year sustainable profitable growth. The Company is subject to a financial covenant in respect of the credit facility (Note 8) whereby the Company must maintain "gross working capital" of at least $500,000 at all times, measured quarterly. There are no other externally imposed capital requirements.
The Company's capital structure consists of shareholders' equity (deficit) and working capital surplus (deficit). In order to maintain or alter the capital structure, the Company may adjust capital spending, obtain credit facilities, raise new debt and issue share capital.
| As at March 31 | 2025 | 2024 |
|---|---|---|
| Deficit attributed to shareholders of Boardwalktech Software Corp. | (3,321,645) | (1,589,703) |
| Working capital surplus (deficit) | (3,591,721) | 474,545 |
21. Subsequent Event
Subsequent to March 31, 2025, the Company closed two tranches of a non-brokered placement for the issuance of an aggregate 5,756,492 units at a price of CAD 0.13 per unit for aggregate gross proceeds of approximately $550,188 (CAD 748,344). Concurrently, the Company issued 115,620 units at a price of $0.09 (CAD 0.13) per unit to United States investors for gross proceeds of $10,406. Each unit is comprised of one common share and one common share purchase warrant exercisable at a price of CAD 0.25 per share for a period of one year from the date of issuance. In connection with private placement, the Company paid approximately $27,554 (CAD 34,478) of commissions to qualified non-related parties and issued a total of 288,292 finders' warrants exercisable at a price of CAD 0.25 per share for a period of one year from the date of issuance.
21