NSE & BSE / 2021-22 / 62B July 22, 2021

The Manager, Corporate Services, National Stock Exchange of India Limited Exchange Plaza, Bandra Kurla Complex, Bandra (E), Mumbai 400 051

Ref: Symbol: PERSISTENT

The Manager, Corporate Services, BSE Limited 14th Floor, P J Towers, Dalal Street, Mumbai 400 001

Ref: Scrip Code: 533179

Dear Sir/Madam,

Sub: Audited Unconsolidated Financial Statements for the quarter ended June 30, 2021 Ref: Our earlier intimations under reference no. NSE & BSE / 2021-22 / 62A dated July 22, 2021

Further to the above referred Intimation We wish to inform you that the Board of Directors at its meeting held on July 22, 2021 through tele-conferencing has approved the Audited Financial Statements for the quarter ended June 30, 2021.

Accordingly, please find enclosed Audited Unconsolidated Financial Statements for the quarter ended June 30, 2021.

Please acknowledge the receipt.

Thanking you,

Yours Sincerely, For Persistent Systems Limited

AMIT MURARI ATRE Digitally signed by AMIT MURARI ATRE Date: 2021.07.22 22:48:31 +05'30'

Amit Atre Company Secretary ICSI Membership No.: A20507

Encl: As above

Walker Chandiok & Co LLP

3rd floor, Unit No. 309 to 312, West Wing, Nyati Unitree Nagar Road, Yerwada, Pune - 411006 Maharashtra, India T +91 20 6744 8888 F +91 20 6744 8899

To the Members of Persistent Systems Limited

Report on the Audit of the Condensed Interim Standalone Financial Statements

Opinion

1. We have audited the accompanying condensed interim standalone financial statements of Persistent Systems Limited condensed interim Balance Sheet as at 30 June 2021, the condensed interim Statement of Profit and Loss (including Other Comprehensive Income) for the quarter ended 30 June 2021, the condensed interim Cash Flow Statement and the Statement of condensed interim Changes in Equity for the quarter ended 30 June 2021, and a summary of the significant accounting policies and other explanatory information.
1. In our opinion and to the best of our information and according to the explanations given to us, the aforesaid condensed interim standalone financial statements give the information required by the Companies Act, 2013 and fair view in conformity with the accounting principles generally accepted in India in accordance with Indian Accounting Standard, 34 , Interim Financial Reporting (Ind As 34) specified under section 133 of the Act, of the state of affairs of the Company as at 30 June 2021, and its profit (including other comprehensive income) for the quarter ended 30 June 2021, its cash flows and the changes in equity for the quarter ended on that date.

Basis for Opinion

We conducted our audit in accordance with the Standards on Auditing specified under section 143(10) of the Act. Our responsibilities under those standards are further described in the Audit of the Condensed Financial Statements section of our report. We are independent of the Company in with the ethical requirements that are relevant to our audit of the financial statements under the provisions of the Act and the rules thereunder, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the Code of Ethics. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Chartered Accountants

Walker Chandiok & Co LLP is registered with limited liability with identification number AAC-2085 and has its registered office at L-41, Connaught Circus, Outer Circle, New Delhi, 110001, India

Offices in Bengaluru, Chandigarh, Chennai, Gurugram, Hyderabad, Kochi, Kolkata, Mumbai, New Delhi, Noida and Pune

Persistent Systems Limited on the Audit of the Condensed Interim Standalone Financial Statements

Responsibilities of Management and Those Charged with Governance for the Standalone Financial Statements

1. The accompanying condensed interim Board of Directors. of the Act with respect to the preparation of these condensed interim standalone financial statements that give a true and fair view of the financial position, financial performance including other comprehensive income, changes in equity and cash flows of the Company in accordance with the accounting principles generally accepted in India, in accordance with Ind AS 34 specified under section 133 of the Act. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding of the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the condensed interim financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.
1. In preparing the condensed interim standalone financial statements, management is responsible for assessing 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.
1. Those Board of Directors is also responsible for overseeing the

Condensed Interim Financial Statements

1. Our objectives are to obtain reasonable assurance about whether the condensed interim standalone financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an guarantee that an audit conducted in accordance with Standards on Auditing 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 condensed interim standalone financial statements.
1. As part of an audit in accordance with Standards on Auditing, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:
Identify and assess the risks of material misstatement of the 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 whether the Company has in place an adequate internal financial controls with reference to financial statements in place and the operating effectiveness of such controls;
Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management;

Page 2 of 3

Chartered Accountants

Walker Chandiok & Co LLP is registered with limited liability with identification number AAC-2085 and has its registered office at L-41, Connaught Circus, Outer Circle, New Delhi, 110001, India

Offices in Bengaluru, Chandigarh, Chennai, Gurugram, Hyderabad, Kochi, Kolkata, Mumbai, New Delhi, Noida and Pune

Persistent Systems Limited on the Audit of the Condensed Interim Standalone Financial Statements

concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conclude that a mate related disclosures in the condensed interim standalone financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the continue as a going concern;
Evaluate the overall presentation, structure and content of the condensed interim standalone financial statements, including the disclosures, and whether the condensed interim standalone financial statements represent the underlying transactions and events in a manner that achieves fair presentation;
1. We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.
1. 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.

For Walker Chandiok & Co LLP Chartered Accountants

:001076N/N500013

Shashi Tadwalkar Partner Membership No:101797

UDIN:21101797AAAABU6970

Place: Pune Date: 22 June 2021

Page 3 of 3

Offices in Bengaluru, Chandigarh, Chennai, Gurugram, Hyderabad, Kochi, Kolkata, Mumbai, New Delhi, Noida and Pune

Walker Chandiok & Co LLP is registered with limited liability with identification number AAC-2085 and has its registered office at L-41, Connaught Circus, Outer Circle, New Delhi, 110001, India

Chartered Accountants

Persistent Systems Limited
CONDENSED INTERIM BALANCE SHEET AS AT JUNE 30, 2021

	Notes	As at	As at	As at
		June 30, 2021	June 30, 2020	March 31, 2021
		In ₹ Million	In ₹ Million	In ₹ Million
ASSETS
Non-current assets
Property, Plant and Equipment	5.1	2,230.03	2,078.16	2,270.24
Capital work in progress		110.27	24 35	112 33
Right of Use assets	5.2	588.09	300 10	314.62
Other Intangible assets	53	188.80	182 38	171.65
Financial assets		3,117.19	2,584.99	2,868.84
- Investments	6	7,844.20	7,742.10	7,779.54
- Loans	$\overline{7}$	106 53	121.61	52.23
- Other non current financial assets	8	41 31	364.84	25.76
Deferred tax assets (net)	9	266.03	318.88	245.74
Other non-current assets	10	470.66	349.72	419.73
		11,845.92	11,482.14	11,391.84

Current assets
Financial assets - Investments	11	9.292.04	3,451.38	6,374.95
- Trade receivables (net)	12	3,451.46	3,433.90	2,966.26
- Cash and cash equivalents	13	715.83	461.29	862.72
- Other bank balances	14	4,982.67	5,483.31	7,387.00
- Loans	15	0.10	0.10	49.33
- Other current financial assets	16	2,585.80	1,925.66	2,063.79
Other current assets	17	1,703.36	1,731 91	1,656.93
		22,731.26	16,487.55	21,360.98

TOTAL		34,577.18	27,969.69	32,752.82
EQUITY AND LIABILITIES

EQUITY
Equity share capital	4	764.25	764 25	764.25
Other equity		28,574.42	23,660.69	26,890.99
		29,338.67	24,424.94	27,655.24
LIABILITIES
Non-current liabilities
Deferred payment liability
Financial liabilities
- Lease liabilities	20	550.42	215.24	304.72
- Borrowings	18	5.54	7.35	5.54
Provisions	19	245 01	194 49	240.94
		800.97	417.08	551.20
Current liabilities
Financial liabilities
- Lease liabilities	20	107.25	162.34	73 82
- Trade payables [(dues of micro and small enterprises ₹ 10.68	21	1,199.54	971.15	938.40
million (Corresponding period: ₹ 2.22 million/ Previous year:
₹ 30.20 million)]
- Other financial liabilities	22	198.53	354.03	397.42
Other current liabilities	23	1,760.03	806 21	1,679.01
Provisions	24	81786	558.30	1,145.59
Current tax liabilities (net)		354 33	275.64	312.14
		4,437.54	3,127.67	4,546.38
TOTAL		34,577.18	27,969.69	32,752.82

Summary of significant accounting policies	3

The accompanying notes are an integral part of the condensed interim financial statements.

As per our report of even date

For Walker Chandiok & Co LLP Chartered Accountants
Firm Registration No.: 001076N/N500013

Digitally signed by
SHASHI TADWALKAR SHASHI TADWALKAR Date: 2021.07.22

Shashi Tadwalkar Partner

Membership No.: 101797

For and on behalf of the Board of Directors of Persistent Systems Limited

Arrand Deshpande

Dr. Anand Deshpande Chairman and Managing
Director

Executive Director and Chief Independent Director
Executive Director and Chief Independent Director DIN: 00005721 DIN: 02506494

Place: Pune
Date :July 22, 2021

Place: Pune
Date:July 22, 2021

Sunil Sapre Amit Atre Sunil Sapre

Executive Director and Chief Company Secretary

Financial Officer

Sandey bohe

Sandeep Kalra

Membership No. A20507

Place: Pune Date: July 22, 2021

DIN: 06475949

Place: Pune
Date :July 22, 2021

(Jul 22, 2021 18:41 GMT+5.5)

Date: July 22, 2021

Place: Pune

Mkilu

Praveen Kadle

DIN: 00016814

Place: Mumbai
Date : July 22, 2021

CONDENSED INTERIM STATEMENT OF PROFIT AND LOSS FOR THE QUARTER ENDED JUNE 30, 2021

	Notes	For the quarter ended		For the year ended
		June 30, 2021	June 30, 2020	March 31, 2021
		In ₹ Million	In ₹ Million	In ₹ Million
Income
Revenue from operations (net)	25	7,648.34	5,561.38	24,796.08
Other income	26	344 68	293.76	1.176.16
Total income (A)		7,993.02	5,855.14	25,972.24
Expenses
Employee benefits expense	27.1	4,441.54	3,057.26	14,093.21
Cost of professionals	27.2	337.25	377.70	1,775 07
Finance costs (refer note 34)		1850	8.79	38.21
Depreciation and amortization expense	5.4	162 71	131.81	566.79
Other expenses	28	823.15	704.10	2,818.76
Total expenses (B)		5,783.15	4,279.66	19,292.04
Profit before tax (A B)		2,209.87	1,575.48	6,680.20
Tax expense
Current tax		537.22	409 97	1,684.00
Tax charge in respect of earlier periods / years			2.74	2.74
Deferred tax charge / (credit)		11.70	(51.99)	(57.40)
Total tax expense		548 92	36072	1,629 34
Net profit for the period / year (C)		1,660.95	1,214.76	5,050.86
Other comprehensive income
Items that will not be reclassified to profit and loss (D)
- Remeasurements of the defined benefit liabilities / asset (net of tax)		(58.30)	17.73	15.93
		(58, 30)	17.73	15.93
Items that may be reclassified to profit and loss (E)
- Effective portion of cash flow hedge (net of tax)		(95.11)	149.98	383.55
		(95.11)	149.98	383 55

Total other comprehensive income for the period / year (D) $+$ (E)		(153.41)	16771	399.48
Total comprehensive income for the period / year $(C) + (D) + (E)$		1,507.54	1,382.47	5,450.34

Earnings per equity share [Nominal value of share ₹10 (Corresponding period/ previous year: ₹10)]	29
Basic (In ₹)		2173	15.89	66.09
Diluted (In ₹)		2173	15.89	66.09

Summary of significant accounting policies	3

The accompanying notes are an integral part of the condensed interim financial statements.

As per our report of even date

For Walker Chandiok & Co LLP Chartered Accountants Firm Registration No.: 001076N/N500013

SHASHI

Digitally signed by SHASHI TADWALKAR TADWALKAR Date: 2021.07.22

Shashi Tadwalkar Partner

Membership No.: 101797

Place: Pune Date: July 22, 2021 For and on behalf of the Board of Directors of Persistent Systems Limited

mkum

Sadeep tolst

Arrand Deshpande

Dr. Anand Deshpande Chairman and Managing Director DIN: 00005721

Sandeep Kalra Praveen Kadle Executive Director and Chief Independent Director Executive Officer DIN: 02506494

DIN: 00016814

Place: Pune Date: July 22, 2021 Place: Pune Date: July 22, 2021

Sunil Sapre

Amit Atre Amit Atre

Sunil Sapre Executive Director and Chief Company Secretary Financial Officer DIN: 06475949 Membership No. A20507

Place: Pune Date: July 22, 2021 Place: Pune

Date: July 22, 2021

Place: Mumbai

Date: July 22, 2021

CONDENSED INTERIM CASH FLOW STATEMENT FOR THE QUARTER ENDED JUNE 30, 2021

	For the quarter ended		For the year ended
	June 30, 2021	June 30, 2020	March 31, 2021
	In ₹ Million	In ₹ Million	In ₹ Million
Cash flows from operating activities
Profit before tax	2,209.87	1,575.48	6,680.20
Adjustments for:
Interest income	(117.69)	(123.92)	(548.82)
Finance cost	18.50	8.79	38 21
Dividend income	÷.	(94.56)	(131.45)
Depreciation and amortization expense	162.71	131.81	566 79
Unrealised exchange (gain) / loss (net)	(15.39)	153.58	151.02
Exchange (gain) / loss on derivative contracts	43.71	(10.23)	(169.80)
Exchange (gain) / loss on translation of foreign currency cash and cash equivalents Bad debts	(7.96)	0.79	23 15 46 96
Change in provision for expected credit loss (net)	(6.37)	35.22	(20.20)
Employee stock compensation expenses	130.07	22.61	236 33
Remeasurements of the defined benefit liabilities / asset (before tax effects)	(78.04)	24 41	1593
(Gain) / loss on fair valuation of mutual funds	(2.21)	155.61	133.70
(Profit) on sale of investments (net)	(106.48)	(291.18)	(478.13)
(Profit) / loss on sale of Property, Plant and Equipment (net)	(0.03)	(0.02)	8.10
Operating profit before working capital changes	2,230.69	1,588 39	6,551.99
Movements in working capital:
(Increase) / Decrease in non-current and current loans	(6.22)	3.21	37.02
Decrease/ (Increase) In other non current assets	3.64	(20.33)	(78, 73)
(Increase)/ Decrease in other current financial assets	(652.70)	188 89	36388
Increase in other current assets	(38.14)	(246.54)	(171.56)
Increase in trade receivables	(469.99)	(731.31)	(312.65)
Increase / (Decrease) in trade payables, current liabilities and non current liabilities	674.77	(51.12)	1.059.46
(Decrease) / Increase in provisions	(323.66)	(20.38)	613 36
Operating profit after working capital changes	1,418.39	710.81	8,062.77
Direct taxes paid (net of refunds)	(475.29)	(263.96)	(1,494.81)
Net cash generated from operating activities (A)	943.10	446.85	6,567.96
Cash flows from investing activities
Payment towards capital expenditure (including intangible assets, capital advances and capital creditors)	(677.00)	(92.20)	(707.24)
Proceeds from sale of Property, Plant and Equipment	0.19	4.06	4.13
Investment in wholly owned subsidiaries			(376.61)
Purchase of bonds	(331.95)	(114.24)	(712.18)
Proceeds from sale of bonds	177.88	116.61	350 53
Investments in mutual funds	(9,783,47)	(4,712,70)	(24, 591, 91)
Proceeds from sale / maturity of mutual funds	7,088.97	7,210.01	25,068.92
(Investments)/ maturity in bank deposits having original maturity over three months	2.219.21	(3,098,27)	(4,464,82)
Interest received	268 62	123.99	35989
Dividend received		94 56	131.45
(B) Net cash used in investing activities	(1,037,55)	(468.18)	(4,937,84)
Cash flows from financing activities
Repayment of long term borrowings			(4.54)
Specific project related grant received		9.00	9.00
Payment of lease liabilities	(41.96)	(48.18)	(173.11)
Dividend paid		(1.35)	(1,069.95)
Interest paid	(18.44)	(8.69)	(38.28)
Net cash used in financing activities (C )	(60, 40)	(49.22)	(1, 276.88)

CONDENSED INTERIM CASH FLOW STATEMENT FOR THE QUARTER ENDED JUNE 30, 2021

	For the quarter ended		For the year ended
	June 30, 2021	June 30, 2020	March 31, 2021
	In ₹ Million	In ₹ Million	In ₹ Million
Net increase/ (decrease) in cash and cash equivalents $(A + B + C)$	(154.85)	(70.55)	353 24
Cash and cash equivalents at the beginning of the year	862.72	532 63	532 63
Effect of exchange differences on translation of foreign currency cash and cash equivalents	7.96	(0.79)	(23.15)
Cash and cash equivalents at the end of the period/ year	71583	461.29	862.72
Components of cash and cash equivalents
Cash on hand (refer note 13)	0.18	0.10	0.10
Balances with banks
On current accounts # (refer note 13)	442.18	83.05	360 22
On saving accounts (refer note 13)	7.50	0.17	1.33
On deposit account with maturity of less than three months (Refer note 13)		22.00	292 50
On Exchange Earner's Foreign Currency accounts (refer note 13)	265.97	35597	208 57
Cash and cash equivalents	715.83	461.29	862.72

Out of the cash and cash equivalent balance as at June 30, 2021, the Company can utilise ₹ 227.86 million (Corresponding period: ₹ 9.12 million/ Previous year: ₹ 154.39 million) only towards certain predefined activities specified in the agreement.

Summary of significant accounting policies - Refer note 3

The accompanying notes are an integral part of the condensed interim financial statements.

As per our report of even date

For Walker Chandiok & Co LLP Chartered Accountants Firm Registration No.: 001076N/N500013

SHASHI TADWALKAR Date: 2021.07.22

Digitally signed by SHASHI TADWALKAR

Shashi Tadwalkar Partner

Membership No: 101797

For and on behalf of the Board of Directors of Persistent Systems Limited

Arrand Deshpande

Dr. Anand Deshpande Chairman and Managing Director DIN: 00005721

Place: Pune Date: July 22, 2021

Sadeey below MWkulu

Sandeep Kalra Executive Director and Chief Executive Officer DIN: 02506494

Place: Pune Date: July 22, 2021

Sunil Sapre

Amit Atre Amit Atre

Company Secretary

Membership No. A20507

Place: Pune Date: July 22, 2021

Praveen Kadle Independent Director

DIN: 00016814

Place: Mumbai Date: July 22, 2021

Place: Pune Date: July 22, 2021 Executive Director and Chief Financial Officer DIN: 06475949

Place: Pune Date: July 22, 2021

Persistent Systems Limited
CONDENSED INTERIM STATEMENT OF CHANGES IN EQUITY FOR THE QUARTER ENDED JUNE 30, 2021

A. Equity share capital (Refer note 4)

.		(In ₹ Million)
Balance as at April 1, 2021	Changes in equity share capital during the period	Balance as at June 30, 2021

764.25	$\blacksquare$	764.25

(In ₹ Million)

Balance as at April 1, 2020	Changes in equity share capital during the period	Balance as at June 30, 2020

764.25	۰.	764.25

(In ₹ Million)

Balance as at April 1, 2020	Changes in equity share capital during the year	Balance as at March 31, 2021

764.25		764.25

CONDENSED INTERIM STATEMENT OF CHANGES IN EQUITY FOR THE QUARTER ENDED JUNE 30, 2021

B. Other equity

								(In ₹ Million)
Particulars				Reserves and surplus			tems of other comprehensive income	Total
	Securities	General reserve	Share options	Capital	Special Economic Zone re-	Retained earnings	Effective portion of
	premium		outstanding	redemption	investment reserve		cash flow hedges
	reserve		reserve	reserve
Balance as at April 1, 2021		14.356.35	471.20	35.75		11.888.23	139 46	26,890.99
Net profit for the period		$\sim$			۰	1,660.95		1,660.95
Other comprehensive income for the period				۰		(58, 30)	(9511)	(153.41)
Employee stock compensation expenses			130.07		$\blacksquare$			130.07
Employee stock compensation expenses of subsidiaries			45.82					45.82
Balance as at June 30, 2021		14.356.35	647.09	35.75	$\blacksquare$	13.490.88	44.35	28.574.42

Particulars				Reserves and surplus			tems of other comprehensive income	$1.1.1.1.1.1.1.1.1.1.1.1.1.1.1.1.1.1.1.$ Total
	Securities premium reserve	General reserve	Share options outstanding reserve	Capital redemption reserve	Special Economic Zone re- investment reserve	Retained earnings	Effective portion of cash flow hedges
Balance as at April 1, 2020		12.227.23	290.51	35.75	49.95	9.861.78	(244.09)	22,221.13
Net profit for the period						1,214.76		1.214.76
Other comprehensive income for the period						17.73	149.98	167.71
Employee stock compensation expenses			22.61					22.61
Employee stock compensation expenses of subsidiaries			34 48					34.48
Balance as at June 30, 2020		12.227.23	347.60	35.75	49.95	11.094.27	(94.11)	23 660 69

								(In ₹ Million)
Particulars				Reserves and surplus			tems of other comprehensive income	Total
	Securities	General reserve	Share options	Capital	Special Economic Zone re-	Retained earnings	Effective portion of
	premium		outstanding	redemption	investment reserve		cash flow hedges
	reserve		reserve	reserve
Balance as at April 1, 2020		12.227.23	290 51	35.75	49.95	9,861.78	(244.09)	22,221.13
Net profit for the year						5,050.86		5,050.86
Other comprehensive income for the year					$\blacksquare$	15.93	383.55	399.48
Dividend						(1,069.95)		(1,069.95)
Transfer to retained earnings					(49.95)	49.95
Transfer to general reserve		2,020.34				(2,020,34)
Adjustments towards employees stock options		108 78	(108, 78)
Employee stock compensation expenses			236 33		$\overline{\phantom{a}}$			236 33
Employee stock compensation expenses of subsidiaries			53.14					53.14
Balance as at March 31, 2021		14,356.35	471.20	35.75		11,888.23	139.46	26,890.99

Summary of significant accounting policies - Refer note 3

The accompanying notes are an integral part of the condensed interim financial statements.

As per our report of even date

For Walker Chandiok & Co LLP Chartered Accountants

Firm Registration No.: 001076N/N500013

Digitally signed by
SHASHI TADWALKAR SHASHI TADWALKAR Date: 2021.07.22 Shashi Tadwalkar

Partner

Membership No.: 101797

Place: Pune Date: July 22, 2021

For and on behalf of the Board of Directors of Persistent Systems Limited

mkilu Sadrephille

Sandeep Kalra

DIN: 02506494

Place: Pune

Arrand Deshpande

Dr. Anand Deshpande Chairman and
Managing Director DIN: 00005721

Praveen Kadle Executive Director and Chief Independent Director
Executive Director and Chief Independent Director

Place: Pune Date: July 22, 2021

Sunil Sapre

Sunil Sapre Executive Director and
Chief Financial Officer DIN: 06475949

Place: Pune Date: July 22, 2021 DIN: 00016814

Date: July 22, 2021

$\mu_n \neq \text{Min}(\mu_n)$

Amit Atre Amit Atre

Company Secretary

Membership No. A20507

Place: Pune Date: July 22, 2021

Place: Mumbai

CONDENSED INTERIM STATEMENT OF CHANGES IN EQUITY FOR THE QUARTER ENDED JUNE 30, 2021

Nature and purpose of reserves

a) Securities premium

Securities premium is used to record the premium on issue of shares. The securities premium is utilised in accordance with the provisions of Section 52 of the Companies Act, 2013.

b) General reserve

General reserve represents amounts transferred from profit for the year and from Share options outstanding reserve on exercise / expiry of employee share options. It is a free reserve in terms of section 2 (43) of the Companies Act, 2013.

c) Share options outstanding reserve

Share options outstanding reserve represents the cumulative expense recognized for equity-settled transactions at each reporting date until the employee share options are exercised / expired on which such amount is transferred to General reserve.

d) Capital redemption reserve

Capital redemption reserve represents the nominal value of the shares bought back and is created and utilised in accordance with Section 69 of the Companies Act, 2013.

e) Special Economic Zone re-investment reserve

The Special Economic Zone re-investment reserve was created out of the profit in terms of the provisions of Section 10AA(1)(ii) of the Income tax Act, 1961. The reserve has been utilised by the Company for acquiring new plant and machinery for the purpose of its business in accordance with Section 10AA(2) of the Income tax Act, 1961.

f) Cash flow hedge reserve

When a derivative is designated as cashflow hedging instrument the effective portion of changes in the fair value of derivative is recognised in Other comprehensive income (OCI) and accumulated in cashflow hedging reserve.

Cumulative gains or losses previously recognised in cashflow hedge reserve are recognised in the statement of profit and loss in the period in which such transaction occurs / hedging instruments are cancelled.

Notes forming part of Condensed Interim Financial Statements

1. Nature of operations

Persistent Systems Limited (the "Company") is a public Company domiciled in India and incorporated under the provisions of the Companies Act, 1956. The shares of the Company are listed on Bombay Stock Exchange and National Stock Exchange. The Company is a global company specializing in software products, services and technology innovation. The Company offers complete product life cycle services.

$2.$ Basis of preparation

The condensed interim financial statements of the Company have been prepared on an accrual basis and under the historical cost convention except for certain financial instruments and equity settled employee stock options which have been measured at fair value. Historical cost is generally based on the fair value of consideration given in exchange of goods and services. The accounting policies are consistently applied by the Company during the period and are consistent with those used in previous year except where a newly issued accounting standard is initially adopted or a revision to an existing accounting standard requires a change in the accounting policy hitherto in use. These condensed interim financial statements are prepared in accordance with Indian Accounting Standard (Ind AS) 34, Interim Financial Reporting, the provisions of the Companies Act, 2013 ("the Act") (to the extent notified) and guidelines issued by the Securities and Exchange Board of India (SEBI). The Ind AS are prescribed under Section 133 of the Act read with Rule 3 of the Companies (Indian Accounting Standards) Rules, 2015 and relevant amendment rules issued thereafter.

All assets and liabilities have been classified as current or non-current as per the Company's operating cycle and other criteria set out in the Schedule III of the Companies Act, 2013 (the "Act"). Based on the nature of products/ services and the time between the acquisition of assets for processing and their realisation in cash and cash equivalents, the Company has ascertained its operating cycle as 12 months for the purpose of current and non-current classification of assets and liabilities.

Summary of significant accounting policies 3.

(a) Use of estimates

A. The preparation of the condensed interim financial statements in conformity with Ind AS requires the Management to make estimates, judgments, and assumptions. These estimates, judgments and assumptions affect the application of accounting policies and the reported amounts of assets and liabilities, the disclosures of contingent assets and liabilities at the date of the condensed interim financial statements and reported amounts of revenues and expenses during the period. The application of accounting policies that require critical accounting estimates involving complex and subjective judgments and the use of assumptions in these condensed interim financial statements have been disclosed appropriately. Accounting estimates could change from period to period. Actual results could differ from those estimates. Appropriate changes in estimates are made as the Management becomes aware of changes in circumstances surrounding the estimates. Changes in estimates are reflected in the condensed interim financial statements in the period in which changes are made and, if material, their effects are disclosed in the notes to the condensed interim financial statements.

B. Estimation of uncertainties relating to the global health pandemic from COVID-19:

The Company has evaluated the likely impact of the COVID-19 on the overall business of the Company. The Company as at the date of the approval of these financials, has used various available sources of information to analyse the carrying amount of its financial assets and exposures. The impact of the COVID-19 on the Company's condensed interim financial statements may differ from the estimate as on the date of the approval of the condensed interim financial statements.

(i) Expected credit loss:

The Company has considered the current and anticipated future economic conditions relating to industries the Company deals with and the countries where it operates. In calculating expected credit loss, the Company has also considered related credit information for its customers to estimate the probability of default in future and has taken into account estimates of possible effect from the pandemic relating to COVID-19 using the forward looking approach prescribed by Ind AS 109.

(ii) Impact on hedged and unhedged foreign currency exposure:

Based on its assessment, the Company believes that the probability of occurrence of its forecasted transactions are not likely to be impacted by COVID – 19. Hence, the Company continues to believe that there is no foreseeable impact on the effectiveness of its cash flow hedges due to this global pandemic.

(iii) Carrying value of financial instruments:

Investments in mutual funds are classified as "Level 1" having fair value marked to an active market which factors in the uncertainties arising out of $COVID - 19$ . These financial assets are mainly investments in liquid securities and no material permanent decline in their carrying value are expected.

(iv) Impact on revenue:

The Company continues to re-evaluate the probable revenues from customers in various verticals to assess any possible drops in revenue from any of these verticals due to the economic stress caused by COVID – 19. Accordingly, it is the opinion of the Company that the customers could re-prioritise their discretionary spend in the immediate future to conserve resources.

The impact assessment of COVID - 19 is a continuing process given the uncertainties associated with its nature and duration. The Company has considered the same to the extent known currently and has taken steps to measure the cost budgets required to complete its performance obligations in respect of fixed price contracts and incorporated the impact of likely delays and costs in meeting its obligations.

C. Critical accounting estimates

i. Revenue recognition

The Company's contracts with customers include promises to transfer multiple products and services to a customer. Revenues from customer contracts are considered for recognition and measurement when the contract has been approved by the parties to the contract, the parties to the contract are committed to perform their respective obligations under the contract, and the contract is legally enforceable. The Company assesses the services promised in a contract and identifies distinct performance obligations in the contract. Identification of distinct performance obligations to determine the deliverables and the ability of the customer to benefit independently from such deliverables, and allocation of transaction price to these distinct performance obligations involves significant judgment.

The Company uses the percentage-of-completion method in accounting for its fixed-price contracts. Use of the percentage-of-completion method requires the Company to estimate the efforts or costs expended to date as a proportion of the total efforts or costs to be expended. Efforts or costs expended have been used to measure progress towards completion. Provisions for estimated losses, if any, on uncompleted contracts are recorded in the period in which such losses become probable based on the expected contract estimates at the reporting date.

Further, the Company uses significant judgement while determining the transaction price allocated to performance obligations using the expected cost-plus margin approach.

In respect of the contracts where the transaction price is payable as revenue share at pre-defined percentage of customer revenue and bearing in mind, the time gap between the close of the accounting period and availability of the revenue report from the customer, the Company is required to use its judgement to ascertain the income from revenue share on the basis of historical trends of customer revenue.

ii. Income taxes

The Company's major tax jurisdiction is India, though the Company also files tax returns in other overseas jurisdictions. Significant judgements are involved in determining the provision for income taxes.

iii. Property, Plant and Equipment

Property, Plant and Equipment represent a significant proportion of the asset base of the Company. The charge in respect of depreciation is derived after determining an estimate of an asset's expected useful life and the expected residual value at the end of its life. The useful lives and residual values of Company's assets are determined by management at the time the asset is acquired and reviewed periodically. The lives are based on historical experience with similar assets as well as anticipation of future events, which may impact their life, such as changes in technology.

iv. Provisions

Provisions are determined based on the best estimate of the amount required to settle the obligation at the reporting date. If the effect of time value of money is material, provisions are discounted using a current pre-tax rate that reflects the risks specific to the liability. These estimates are reviewed at each balance sheet date and adjusted to reflect the current best estimates.

v.Leases

Ind AS 116 requires lessees to determine the lease term as the non-cancellable period of a lease adjusted with any option to extend or terminate the lease, if the use of such option is reasonably certain. The Company makes an assessment on the expected lease term on a lease-by-lease basis and thereby assesses whether it is reasonably certain that any options to extend or terminate the contract will be exercised. In evaluating the lease term, the Company considers factors such as any significant leasehold improvements undertaken over the lease term, costs relating to the termination of the lease and the importance of the underlying asset to the Company's operations taking into account the location of the underlying asset and the availability of suitable alternatives. The lease term in future periods is reassessed to ensure that the lease term reflects the current economic circumstances. After considering current and future economic conditions, the Company has concluded that no changes are required to lease periods relating to the existing lease contracts.

(b) Property, Plant and Equipment

Property, Plant and Equipment are stated at cost, less accumulated depreciation and accumulated impairment losses, if any. The cost comprises the purchase price and directly attributable costs of bringing the asset to its working condition for its intended use. Any trade discounts and rebates are deducted in arriving at the purchase price. Capital work-in-progress includes cost of Property, Plant and Equipment that are not ready to be put to use.

Subsequent expenditure related to an item of Property, Plant and Equipment is added to its original cost only if it is probable that future economic benefits associated with the item will flow to the Company. All other expenses on existing Property, Plant and Equipment, including day-to-day repair and maintenance expenditure and cost of replacing parts, are charged to the statement of profit and loss for the period during which such expenses are incurred.

Gains or losses arising from disposal of Property, Plant and Equipment are measured as the difference between the net disposal proceeds and the carrying amount of the asset and are recognized in the statement of profit and loss when the asset is disposed

(c) Intangible assets

Intangible assets including software licenses of enduring nature and contractual rights acquired separately are measured on initial recognition at cost. Following initial recognition, intangible assets are carried at cost less accumulated amortization and accumulated impairment losses, if any. Cost comprises the purchase price and any directly attributable cost of bringing the asset to its working condition for its intended use.

Gains or losses arising from disposal of an intangible asset are measured as the difference between the net disposal proceeds and the carrying amount of the asset and are recognized in the statement of profit and loss when the asset is disposed

Research and development cost

Research costs are expensed as incurred. Development expenditure incurred on an individual project is recognized as an intangible asset when the Company can demonstrate:

technical feasibility of completing the intangible asset so that it will be available for use or sale;
its intention to complete the asset;
its ability to use or sell the asset;
how the asset will generate probable future economic benefits:
the availability of adequate resources to complete the development and to use or sell the asset; and
the ability to measure reliably the expenditure attributable to the intangible asset during development.

Such development expenditure, until capitalization, is reflected as intangible assets under development.

Following the initial recognition, internally generated intangible assets are carried at cost less accumulated amortization and accumulated impairment losses, if any. Amortization of internally generated intangible asset begins when the development is complete and the asset is available for use.

(d) Depreciation and amortization

Depreciation on Property, Plant and Equipment is provided using the Straight Line Method ('SLM') over the useful lives of the assets estimated by the management.

The management estimates the useful lives for the Property, Plant and Equipment as follows:

Assets	Useful lives
Buildings*	25 years
Computers	3 years
Computers - Servers and networks*	3 years
Office equipments	5 years
Plant and equipment*	5 years
Plant and equipment (Windmill)*	20 years
Plant and equipment (Solar Energy System)*	10 years
Furniture and fixtures*	5 years
Vehicles*	5 vears

*For these classes of assets, based on technical evaluation, the management believes that the useful lives as given above best represent the period over which the management expects to use these assets.

Leasehold improvements are amortized over the period of lease or useful life, whichever is lower.

Intangible assets are amortized on a straight-line basis over their estimated useful lives ranging from 3 to 6 years from the day the asset is made available for use.

Notes forming part of Condensed Interim Financial Statements

Where cost of a part of the asset ("asset component") is significant to total cost of the asset and useful life of that part is different from the useful life of the remaining asset, useful life of that significant part is determined separately and such asset component is depreciated over its separate useful life.

Depreciation methods, useful lives and residual values are reviewed periodically.

(e) Borrowing costs

Borrowing cost includes interest and amortization of ancillary costs incurred in connection with the arrangement of borrowings.

Borrowing costs directly attributable to the acquisition, construction or development of an asset that necessarily takes a substantial period of time to get ready for its intended use or sale are capitalized as part of the cost of the respective asset. All other borrowing costs are expensed in the period / year they occur.

$(f)$ Leases

The Company's lease asset classes primarily consist of leases for land and office premises. The Company assesses whether a contract contains a lease, at inception of a contract. A contract is, or contains, a lease if the contract conveys the right to control the use of an identified asset for a period of time in exchange for consideration.

To assess whether a contract conveys the right to control the use of an identified asset, the Company assesses whether:

(i) the contract involves the use of an identified asset

(ii) the Company has substantially all of the economic benefits from use of the asset through the period of the lease and (iii) the Company has the right to direct the use of the asset

Where the Company is a lessee

The Company accounts for each lease component within the contract as a lease separately from non-lease components of the contract and allocates the consideration in the contract to each lease component on the basis of the relative stand-alone price of the lease component and the aggregate stand-alone price of the non-lease components.

The Company recognises right-of-use asset representing its right to use the underlying asset for the lease term at the lease commencement date. The cost of the right-of-use asset measured at inception shall comprise of the amount of the initial measurement of the lease liability adjusted for any lease payments made at or before the commencement date less any lease incentives received, plus any initial direct costs incurred and an estimate of costs to be incurred by the lessee in dismantling and removing the underlying asset or restoring the underlying asset or site on which it is located.

The right-of-use assets is subsequently measured at cost less any accumulated depreciation, accumulated impairment losses, if any and adjusted for any remeasurement of the lease liability. The right-of-use assets is depreciated using the straight-line method from the commencement date over the shorter of lease term or useful life of right-of-use asset. The estimated useful lives of right-of use assets are determined on the same basis as those of Property, Plant and Equipment.

Right-of-use assets are tested for impairment whenever there is any indication that their carrying amounts may not be recoverable. Impairment loss, if any, is recognised in the statement of profit and loss.

The Company measures the lease liability at the present value of the lease payments that are not paid at the commencement date of the lease. The lease payments are discounted using the interest rate implicit in the lease, if that rate can be readily determined. If that rate cannot be readily determined, the Company uses incremental borrowing rate.

The lease payments shall include fixed payments, variable lease payments based on an index or rate, residual value guarantees, exercise price of a purchase option where the Company is reasonably certain to exercise that option and payments of penalties for terminating the lease, if the lease term reflects the lessee exercising an option to terminate the lease.

The lease liability is subsequently remeasured by increasing the carrying amount to reflect interest on the lease liability, reducing the carrying amount to reflect the lease payments made and remeasuring the carrying amount to reflect any reassessment or lease modifications or to reflect revised in-substance fixed lease payments.

When the lease liability is remeasured, the corresponding adjustment is reflected in the right-of-use asset, or statement of profit and loss if the right-of-use asset is already reduced to zero.

The Company has elected not to apply the requirements of Ind AS 116 to short-term leases of all assets that have a lease term of 12 months or less and leases for which the underlying asset is of low value. The lease expenses associated with these leases are recognized in the statement of profit and loss on a straight line basis.

Company as a lessor

At the inception of the lease, the Company classifies each of its leases as either an operating lease or a finance lease. Whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessee, the contract is classified as a finance lease. All other leases are classified as operating leases. The Company recognises lease payments received under operating leases as income over the lease term on a straight line basis.

(g) Financial instruments

Initial recognition and measurement

The Company recognizes financial assets and financial liabilities when it becomes a party to the contractual provisions of the instrument. All financial assets and liabilities are recognized at fair value on initial recognition, except for trade receivables which are initially measured at transaction price. Transaction costs that are directly attributable to the acquisition or issue of financial assets and financial liabilities, which are not at fair value through profit or loss, are added to the fair value on initial recognition.

A. Non-derivative financial instruments

Subsequent measurement

(i) Financial Assets

Financial assets at amortized cost

Financial assets that are held within a business model whose objective is to hold assets for collecting contractual cash flows and whose contractual terms give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding are subsequently measured at amortized cost using the effective interest rate method. The change in measurements are recognized as finance income in the statement of profit and loss.

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

Financial assets that are held within a business model whose objective is achieved both by collecting contractual cash flows and selling the financial assets and the assets' contractual cash flows represent solely payments of principal and interest on the principal amount outstanding are subsequently measured at fair value. Fair value movements are recognized in other comprehensive income.

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

Any financial asset which does not meet the criteria for categorization as financial asset at amortized cost or at FVTOCI, is classified as financial asset at FVTPL. Financial assets except derivative contracts included within the FVTPL category are subsequently measured at fair value with all changes recognized in the statement of profit and loss.

(ii) Financial Liabilities

Financial liabilities at amortized cost

Financial liabilities are subsequently carried at amortized cost using the effective interest method, except for contingent consideration recognized in a business combination which is subsequently measured at fair value through profit or loss. For trade and other payables maturing within one year from the Balance Sheet date, the carrying amounts approximate fair value due to the short maturity of these instruments.

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

Financial liabilities include financial liabilities held for trading and financial liabilities designated upon initial recognition at fair value through profit or loss if the recognition criteria as per Ind AS 109 - "Financial Instruments" are satisfied. Gains or losses on liabilities held for trading are recognized in statement of profit and loss.

Fair value gains or losses on liabilities designated as FVTPL attributable to changes in own credit risk are recognized in other comprehensive income. All other changes in fair value of liabilities designated as FVTPL are recognized in the statement of profit and loss. The Company has not designated any financial liability as FVTPL.

Investments in subsidiaries, associates and joint ventures

Investment in subsidiaries, associates and joint ventures are carried at cost.

B. Derivative financial instruments

The Company uses derivatives for economic hedging purposes. At the inception of hedging relationship, the Company documents the hedging relationship between the hedging instrument and hedged item including whether the changes in cash flows of the hedging instruments are expected to offset the changes in cash flows of the hedged items. The Company documents its objective and strategy for undertaking its hedging transactions.

Derivatives are initially recognised at fair value on the date a derivative contract is entered and are subsequently remeasured at fair value at each reporting date.

For cash flow hedges, that qualify for hedge accounting, the effective portion of fair value of derivatives are recognised in cash flow hedging reserve within equity.

Gains or losses relating to the ineffective portion is immediately recognised in profit or loss.

Amounts accumulated in equity are reclassified to profit or loss in the period when the hedged item affects profit and loss or hedged future cash flows are no longer expected to occur.

Derivatives which do not qualify for hedge accounting are accounted as fair value through profit or loss.

C. Derecognition

The Company derecognizes a financial asset when the contractual rights to the cash flows from the financial asset expire or it transfers the financial asset and the transfer qualifies for derecognition under Ind AS 109. A financial liability (or a part of a financial liability) is derecognized from the Company's Balance Sheet when the obligation specified in the contract is discharged or cancelled or expires. On derecognition of a financial asset in its entirety, the difference between the asset's carrying amount and the sum of the consideration received and receivable and the cumulative gain or loss that had been recognised in other comprehensive income and accumulated in equity, if any, is recognised in profit or loss, except in case of equity instruments classified as FVOCI, where such cumulative gain or loss is not recycled to statement of profit and loss.

The Company derecognizes financial liabilities when the Company's obligations are discharged, cancelled or have expired. The difference between the carrying amount of the financial liability derecognized and the consideration paid and payable is recognised in profit or loss.

D. Fair value of financial instruments

In determining the fair value of its financial instruments, the Company uses a variety of methods and assumptions that are based on market conditions and risks existing at each reporting date. The methods used to determine fair value include discounted cash flow analysis, available quoted market prices, dealer quotes.

For equity instruments of unlisted companies, in limited circumstances, insufficient more recent information is available to measure fair value, or if there are a wide range of possible fair value measurements and cost represents the best estimate of fair value within that range. The Company recognises such equity instruments at cost, which is considered as appropriate estimate of fair value.

All methods of assessing fair value result in general approximation of value, and such value may never actually be realized. Refer to the table on financial instruments by category below for the disclosure on carrying value and fair value of financial assets and liabilities. For financial assets and liabilities maturing within one year from the Balance Sheet date and which are not carried at fair value, the carrying amounts approximate fair value due to the short maturity of these instruments.

E. Impairment of financial assets

The Company applies Expected Credit Loss (ECL) model for measurement and recognition of impairment loss on financial assets measured at amortized cost and financial assets that are debts instruments and are measured at fair value through other comprehensive income (FVTOCI). ECL is the difference between contractual cash flows that are due and the cash flows that the Company expects to receive, discounted at the original effective interest rate.

For trade receivables, the Company recognizes impairment loss allowance based on lifetime ECL at each reporting date, right from its initial recognition. For other financial assets, the Company determines whether there has been a significant increase in the credit risk since initial recognition. If credit risk has not increased significantly, 12 month ECL is used to provide for impairment loss. However, if credit risk has increased significantly, lifetime ECL is used.

F. Impairment of Non-Financial assets

The carrying amounts of Property, Plant and Equipment are reviewed at each balance sheet date or whenever there is any indication of impairment based on internal/external factors. If any indications exist, the Company estimates the asset's recoverable amount unless the asset does not generate cash flows that are largely independent of those from other assets. In such cases, the recoverable amount is determined for the Cash Generating Unit (CGU) to which the asset belongs. If the recoverable amount of an asset (or CGU) is estimated to be less than its carrying amount, the carrying amount of the asset (or CGU) is reduced to its recoverable amount. The recoverable amount is the greater of the asset's fair value and its value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and risks specific to the asset

(h) Revenue recognition

Revenues from customer contracts are considered for recognition and measurement when the contract has been approved by the parties to the contract, the parties to the contract are committed to perform their respective obligations under the contract, and the contract is legally enforceable. Revenue is recognized upon transfer of control of promised products or services ("performance obligations") to customers in an amount that reflects the consideration the Company has received or expects to receive in exchange for these products or services ("transaction price"). When there is uncertainty as to collectability, revenue recognition is postponed until such uncertainty is resolved. The Company assesses the services promised in a contract and identifies distinct performance obligations in the contract. The Company allocates the transaction price to each distinct performance obligation based on the relative standalone selling price. The price that is regularly charged for an item when sold separately is the best evidence of its standalone selling price. In the absence of such evidence, the primary method used to estimate standalone selling price is the expected cost plus a margin, under which the Company estimates the cost of satisfying the performance obligation and then adds an appropriate margin based on similar services. The Company's contracts may include variable consideration including rebates, volume discounts and penalties. The Company includes variable consideration as part of transaction price when there is a basis to reasonably estimate the amount of the variable consideration and when it is probable that a significant reversal of cumulative revenue recognized will not occur when the uncertainty associated with the variable consideration is resolved.

$(i)$ Income from software services and products

The company derives revenues primarily from IT services comprising of software development and related services and from the licensing of software products.

Arrangements with customers for software related services are either on a time-and-material or a fixed-price basis.

Revenue on time-and-material contracts are recognized as and when the related services are performed. Revenue from fixed-price contracts, where the performance obligations are satisfied over time and where there is no uncertainty as to measurement or collectability of consideration, is recognized as per the percentage-of-completion method. When there is uncertainty as to measurement or ultimate collectability, revenue recognition is postponed until such uncertainty is resolved.

Revenue from licenses where the customer obtains a "right to use" the licenses is recognized at the time the license is made available to the customer. Revenue from licenses where the customer obtains a "right to access" is recognized over the access period.

When support services are provided in conjunction with the licensing arrangement and the license and the support services have been identified as two separate performance obligations, the transaction price for such contracts are allocated to each performance obligation of the contract based on their relative standalone selling prices. Maintenance revenue is recognized proportionately over the period in which the services are rendered.

Revenue from revenue share is recognized in accordance with the terms of the relevant agreements.

In cases where company acts as an agent, the revenue is recognised in form of a commission on delivery of the software licenses.

Unbilled revenue represents revenue recognized in relation to work done until the balance sheet date for which billing has not taken place.

Unearned revenue represents the billing in respect of contracts for which the revenue is not recognized.

The Company collects Goods and Services Tax on behalf of the government and, therefore, these are not economic benefits flowing to the Company. Hence, they are excluded from revenue.

(ii) Interest

Interest income is recognized on a time proportion basis taking into account the carrying amount and the effective interest rate.

(iii) Dividend

Dividend income is recognized when the Company's right to receive dividend is established. Dividend income is included under the head 'Other income' in the statement of profit and loss.

$(i)$ Government grants

Government grants are recognized at fair value when there is reasonable assurance that the Company will comply with the conditions attaching to them and the grants will be received. Grants related to purchase of assets are treated as deferred income and allocated to income statement over the useful lives of the related assets while grants related to expenses are deducted in reporting the related expenses in the income statement.

Foreign currency translation (j)

Foreign currency transactions and balances

Initial recognition

Foreign currency transactions are recorded in the functional currency of the Company, by applying to the foreign currency amount the exchange rate between the functional currency and the foreign currency at the date of the transaction.

Conversion

Foreign currency monetary items are converted using the exchange rate prevailing at the reporting date. Non-monetary items, which are measured in terms of historical cost denominated in a foreign currency are reported using the exchange rate at the date of the transaction. Non-monetary items which are carried at fair value or other similar valuation denominated in a foreign currency are reported using the exchange rates at the date when the values were determined.

Exchange differences

Exchange differences arising on conversion / settlement of foreign currency monetary items and on foreign currency liabilities relating to Property, Plant and Equipment acquisition are recognized as income or expenses in the period in which they arise.

Translation of foreign operations

The assets and liabilities of a foreign operations are translated into the reporting currency (INR) at the exchange rate prevailing at the reporting date.

(k) Retirement and other employee benefits

$(i)$ Provident fund

Provident fund is a defined contribution plan covering eligible employees. The Company and the eligible employees make a monthly contribution to the provident fund maintained by the Regional Provident Fund Commissioner equal to the specified percentage of the basic salary of the eligible employees as per the scheme. The contributions to the provident fund are charged to the statement of profit and loss for the period / year when the contributions are due. The Company has no obligation, other than the contribution payable to the provident fund.

(ii) Gratuity

Gratuity is a defined benefit obligation plan operated by the Company for its employees covered under Company Gratuity Scheme. The cost of providing benefit under gratuity plan is determined on the basis of actuarial valuation using the projected unit credit method at the reporting date and are charged to the statement of profit and loss, except for the remeasurements, comprising of actuarial gains and losses which are recognized in full in the statement of other comprehensive income in the reporting period in which they occur. Remeasurements are not reclassified to the statement of profit and loss subsequently.

(iii) Superannuation

Superannuation is a defined contribution plan covering eligible employees. The contribution to the superannuation fund managed by the insurer is equal to the specified percentage of the basic salary of the eligible employees as per the scheme. The contribution to this scheme is charged to the statement of profit and loss on an accrual basis. There are no other contributions payable other than contribution payable to the respective fund.

(iv) Leave encashment

The expected cost of accumulating leave encashment is determined by actuarial valuation performed by an independent actuary at each Balance Sheet date using projected unit credit method on the additional amount expected to be paid / availed as a result of the unused entitlement that has accumulated at the Balance Sheet date. Expense on non-accumulating leave encashment is recognized in the period in which the absences occur.

(v) Long service awards

Long service awards are other long term benefits to all eligible employees, as per Company's policy. The cost of providing benefit under long service awards scheme is determined on the basis of actuarial valuation using the projected unit credit method at the reporting date. Remeasurements, comprising of actuarial gains and losses are recognized in full in the statement of profit and loss.

Income taxes $\mathbf{I}$

Tax expense comprises of current and deferred tax. Current income tax is measured at the amount expected to be paid to the tax authorities in accordance with the Income Tax Act, 1961 enacted in India and tax laws prevailing in the respective tax jurisdictions where the Company operates. The tax rates and tax laws used to compute the amount are those that are enacted or substantively enacted, at the reporting date. Current income tax relating to items recognized directly in equity is recognized in equity and not in statement of profit and loss.

Deferred income taxes reflect the impact of temporary differences between tax base of assets and liabilities and their carrying amounts. Deferred tax is measured based on the tax rates and the tax laws enacted or substantively enacted at the reporting date

Deferred tax liabilities are recognized for all taxable temporary differences, except deferred tax liability arising from initial recognition of goodwill or an asset or liability in a transaction that is not a business combination and, affects neither accounting nor taxable profit/ loss at the time of transaction. Deferred tax assets are recognized for all deductible temporary differences, the carry forward of unused tax credits and any unused tax losses, except deferred tax assets arising from initial recognition of goodwill or an asset or liability in a transaction that is not a business combination and, affects neither accounting nor taxable profit/ loss at the time of transaction. Deferred tax assets are recognized only to the extent that sufficient future taxable income will be available against which such deferred tax assets can be realized.

In the situations where the Company is entitled to a tax holiday under the Income-tax Act, 1961 enacted in India or tax laws prevailing in the respective tax jurisdictions where it operates, no deferred tax (asset or liability) is recognized in respect of temporary differences which reverse during the tax holiday period, to the extent the Company's gross total income is subject to the deduction during the tax holiday period. Deferred tax in respect of temporary differences which reverse after the tax holiday period is recognized in the period / year in which the temporary differences originate.

The carrying amount of deferred tax asset is reviewed at each reporting date and reduced to the extent that it is no longer probable that sufficient taxable profit will be available against which such deferred tax assets can be realized.

Deferred tax assets and deferred tax liabilities are offset, if a legally enforceable right exists to set off current tax assets against current tax liabilities and the deferred tax assets and deferred tax liabilities relate to the same taxable entity and the same taxation authority.

Deferred tax relating to items recognized outside the statement of profit and loss is recognized in co-relation to the underlying transaction either in other comprehensive income or directly in equity.

Minimum alternate tax (MAT) paid in a period / year is charged to the statement of profit and loss as current tax. MAT credit available is recognized as an asset only to the extent that there is convincing evidence that the Company will pay normal income tax during the period, i.e., the period for which MAT credit is allowed to be carried forward. In the period / year in which the Company recognizes MAT credit as an asset in accordance with the Guidance Note on Accounting for Credit Available in respect of Minimum Alternative Tax under the Income-tax Act, 1961, the said asset is created by way of credit to the statement of profit and loss and shown as "MAT Credit Entitlement." The Company reviews the "MAT credit entitlement" asset at each reporting date and writes down the asset to the extent the Company does not have convincing evidence that it will pay normal tax during the specified period.

(m) Segment reporting

In accordance with para 4 of Notified Indian Accounting Standard 108 (Ind AS-108) "Operating Segments" the Company has disclosed segment information only in consolidated financial statements which are presented together with the standalone financial statements.

(n) Earnings per share (EPS)

Basic earnings per share are calculated by dividing the net profit for the period / year attributable to equity shareholders by the weighted average number of equity shares outstanding during the period / year. The weighted average number of equity shares outstanding during the reporting period is adjusted for events such as bonus issue, bonus element in a rights issue, share split, and reverse share split (consolidation of shares), if any occurred during the reporting period, that have changed the number of equity shares outstanding, without a corresponding change in resources.

For the purpose of calculating diluted earnings per share, the net profit for the period / year attributable to the equity shareholders and the weighted average number of equity shares outstanding during the period / year, are adjusted for the effects of all dilutive potential equity shares.

The number of shares and potential dilutive equity shares are adjusted retrospectively for all periods presented for any bonus shares issues including for changes effected prior to the approval of the condensed interim financial statements by the Board of Directors.

(o) Provisions

A provision is recognized when the Company has a present obligation as a result of past event; it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation, in respect of which a reliable estimate can be made. Provisions are determined based on the best estimate of the amount required to settle the obligation at the reporting date. If the effect of time value of money is material, provisions are discounted using a current pre-tax rate that reflects the risks specific to the liability. These estimates are reviewed at each balance sheet date and adjusted to reflect the current best estimates.

(p) Contingent liabilities

A contingent liability is a possible obligation that arises from past events whose existence will be confirmed by the occurrence or non-occurrence of one or more uncertain future events beyond the control of the Company or a present obligation that is not recognized because it is not probable that an outflow of resources will be required to settle the obligation. A contingent liability also arises in extremely rare cases where there is a liability that cannot be recognized because it cannot be measured reliably.

(q) Cash and cash equivalents

Cash and cash equivalents in the cash flow statement comprises of cash at bank, cash in hand and short term deposits with an original maturity period of three months or less.

Employee stock compensation expenses (r)

Employees of the Company receive remuneration in the form of share based payment transactions, whereby employees render services as consideration for equity instruments granted (equity-settled transactions).

In accordance with Ind AS 102 - "Share Based Payments", the cost of equity-settled transactions is determined by the fair value of the options at the date of the grant and recognized as employee compensation cost over the vesting period. The cumulative expense recognized for equity-settled transactions at each reporting date until the vesting date reflects the extent to which the vesting period has expired and the Company's best estimate of the number of equity instruments that will ultimately vest.

The expense or credit recognized in the statement of profit and loss for a period / year represents the movement in cumulative expense recognized as at the beginning and end of that period / year and is recognized in employee benefits expense. In case of the employee stock option schemes having a graded vesting schedule, each vesting tranche having different vesting period has been considered as a separate option grant and accounted for accordingly.

Where the terms of an equity-settled transaction award are modified, the minimum expense recognized is the expense as if the terms had not been modified, if the original terms of the award are met. An additional expense is recognized for any modification that increases the total fair value of the share-based payment transaction or is otherwise beneficial to the employee as measured at the date of modification.

The employee stock option expenses in respect of the employees of the subsidiaries are charged to the respective subsidiary.

(s) Equity

Ordinary shares are classified as equity share capital. Incremental costs directly attributable to the issuance of new ordinary shares, share options and buyback are recognized as a deduction from equity, net of any tax effects

$(t)$ Dividend

Final dividend on shares are recorded as a liability on the date of approval by the shareholders and interim dividends are recorded as a liability on the date of declaration by the Company's Board of Directors

Notes forming part of Condensed Interim Financial Statements

(u) Recent pronouncements

On June 18, 2021, MCA through a notification has notified Companies (Indian Accounting Standards) Amendment Rules, 2021. The notification has made amendments to various Ind AS. Some of the key amendments are:

Ind AS 116 - COVID-19-Related Rent Concessions

The economic challenges presented by the COVID-19 pandemic have persisted longer than anticipated, and therefore the practical expedient relating to rent concessions arising as a consequence of COVID-19 has been modified. Accordingly, lessees are now exempted from assessing whether a COVID-19-related rent concession is a lease modification, if the reduction in lease payments affects only payments originally due on or before June 30, 2022. Earlier the practical expedient was allowed only for lease payments originally due on or before June 30, 2021. A lessee should apply the amendments for annual reporting periods beginning on or after April 1, 2021. The Company does not expect any impact on its financial statements due to this amendment.

Interest Rate Benchmark Reform - Phase 2

This amendment relates to 'Interest Rate Benchmark Reform - Phase 2 (Amendments to Ind AS 104, Ind AS 107, Ind AS 109 and Ind AS 116)' which addresses issues that might affect financial reporting after the reform of an interest rate benchmark, including its replacement with alternative benchmark rates. Some of the key amendments arising from the interest rate benchmark are:

Ind AS 109: New guidance has been included on changes in the basis for determining the contractual cashflows as a result of interest rate benchmark reform. An entity should apply the amendments for annual reporting periods beginning on or after April 1, 2021.

Ind AS 107: Additional disclosures related to nature and extent of risks to which the entity is exposed from financial instruments subject to interest rate benchmark reform and how the entity manages these risks. An entity should apply the amendments when it applies amendments to Ind AS 109, Ind AS 104 or Ind AS 116. The Company does not expect the amendments to have any significant impact in its financial statements.

Amendments to Ind AS consequential to Conceptual Framework under Ind AS

The amendments relating to Ind AS 102. Share-based Payment: Ind AS 103. Business Combinations: Ind AS 1. Presentation of Financial Statements; Ind AS 8, Accounting Policies, Changes in Accounting Estimates and Errors; Ind AS 34, Interim Financial Reporting; Ind AS 37, Provisions, Contingent Liabilities and Contingent Assets; Ind AS 38, Intangible Assets, are consequential due to changes in the Conceptual Framework under Ind AS, made in August 2020. The revised Conceptual Framework introduced some new concepts and clarifications The amendments relating to Ind AS 102, Sharebased Payment; Ind AS 103, Business Combinations; Ind AS 1, Presentation of Financial Statements; Ind AS 8, Accounting Policies, Changes in Accounting Estimates and Errors; Ind AS 34, Interim Financial Reporting; Ind AS 37, Provisions, Contingent Liabilities and Contingent Assets; Ind AS 38, Intangible Assets, are consequential due to changes in the Conceptual Framework under Ind AS, made in August 2020. The revised Conceptual Framework introduced some new concepts and clarifications along with revision in definitions and changes in recognition criteria of assets and liabilities under Ind AS. The Company does not expect the consequential amendments to have any significant impact in its financial statements.

Notes forming part of Condensed Interim Financial Statements

4. Share Capital

	As at June 30, 2021 In ₹ Million	As at June 30, 2020 In ₹ Million	As at March 31, 2021 In ₹ Million
Authorized shares (No. in million)
200 (Corresponding period/ Previous year: 200) equity shares of ₹10 each	2.000.00	2.000.00	2.000.00
	2,000.00	2,000.00	2,000.00
Issued, subscribed and fully paid-up shares (No. in million)
76.43 (Corresponding period/ Previous year: 76.43) equity shares of ₹10 each	764.25	764.25	764 25
Issued, subscribed and fully paid-up share capital	764.25	764.25	764.25

a) Reconciliation of the shares outstanding at the beginning and at the end of the period/ year

The reconciliation of the number of shares outstanding and the amount of share capital is set out below:

						(In Million)
		As at	As at		As at
	June 30, 2021		June 30, 2020		March 31, 2021
	No of Shares	Amount ₹	No of Shares	Amount ₹	No of Shares	Amount ₹
Number of shares at the beginning of the period/year	76.43	764.25	76.43	764.25	76.43	764.25
Less: Changes during the period/Year		-	-	$\overline{\phantom{0}}$		$\sim$
Number of shares at the end of the period/year	76.43	764.25	76.43	764.25	76.43	764 25

b) Terms / rights attached to equity shares

The Company has only one dass of equity shares having a par value of ₹10 per share. Each holder of equity shares is entitled to one vote per share. The Company declares and pays dividends in Indian rupees after deducting applicable taxes.

In the event of liquidation of the Company, the holders of equity shares will be entitled to receive remaining assets of the Company, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders. However, no such preferential amounts exists currently.

c) Aggregate number shares bought back during the period of five years immediately preceding the reporting date

		For the period of For the period of For the period of
		five years ended five years ended five years ended
	June 30, 2021	June 30, 2020	March 31, 2021
	No in Million	No in Million	No in Million
Equity shares bought back	3.575	3.575	3.575

d) Details of shareholders holding more than 5% shares in the Company

Name of the shareholder*		As at	As at		As at
		June 30, 2021	June 30, 2020		March 31, 2021
	No. in million	% Holdina	No. in million	% Holdina	No. in million	% Holding
Dr. Anand Deshpande jointly with Mrs. Sonali Anand Deshpande	22.96	30.04	22 95	30.04	22.96	30 04
Schemes of HDFC Mutual Fund	5 1 5	6.74	5.86	767	5.37	7.03

* The shareholding information is based on legal ownership of shares and has been extracted from the records of the Company including register of shareholders / members. (This space is intentionally left blank)

Notes forming part of Condensed Interim Financial 5.1 Property, plant and equipment Persistent Systems Limited	Statements								(In ₹ Million)
	Freehold land		Buildings* Computers	equipments Office	equipment Plant and	improvements Leasehold	Furniture and fixtures	Vehicles	Total
Gross block (at cost) As at April 1, 2021 Additions	206.92	2,38773 0.04	4710 2,331.29	3.19 5784	1739 1,407 04	2079 $\blacksquare$	9.06 52732	724	7678 6,946.17
As at June 30, 2021 Disposals	206.92	2,38777	052 2,377.87	6103	1,424.43	2079	0.72 53566	724 ī	124 7,02171
Accumulated depreciation Charge for the period As at April 1, 2021 Disposals	$\blacksquare$ $\blacksquare$	1,15749 2402	7635 1,732.90 0.36	5175 0.67	1,215.65 10.94	2019 0.21	0.72 4.41 49297	0.23 498	4,675.93 11683 108
As at June 30, 2021	$\blacksquare$ ŧ,	1,181.51	1,808.89	5242	1,226.59	2040	496.66	521	4,791 68
As at March 31, 2021 As at June 30, 2021 Net block	206.92 206 92	1,206.26 1,230.24	598.39 56898	6 O.G $\frac{6}{10}$	19139 19784	0.39 0.60	3435 39.00	226 203	$2,230$ 03 2,270.24
c) Accumulated depreciation as on June 30, 2021 ₹ 572.79 million (Corresponding period ₹ 513.74 million/ Previous year ₹ 558.07 million) a) Gross block as on June 30, 2021 ₹ 1,454.64 million (Corresponding period ₹ 1,454.48 Million / Previous year ₹ 1,454.60 million) d) Net block value as on June 30, 2021 ₹ 881.85 million (Corresponding period ₹ 940.74 million /Previous year ₹ 896.53 million) b) Depreciation charge for the year ₹ 14.72 million (Corresponding period ₹ 14.71 million / Previous year ₹ 59.04 million) * Note: Building includes those constructed on leasehold land:
5.2 Right of use assets									(In $\bar{\epsilon}$ Million)
							Office premises Leasehold land		Total
Gross block (at cost) As at April 1, 2021							443 17	3750	48067
Additions							30265		30265
As at June 30, 2021 Disposals							110.28 63554	3750	110.28 67304
Accumulated depreciation
As at April 1, 2021							16487	1.18	166.05
Charge for the period							2903	0.15	29.18
Disposals							110.28		11028
As at June 30, 2021							8362	133	8495
Net block
As at March 31, 2021 As at June 30, 2021							55192 278 30	36.32 36.17	$\frac{58809}{31462}$

Notes forming part of Condensed Interim Financial Statements

5.1 Property, plant and equipment

3. I Flopelty, plant and equipment									(In ₹ Million)
	Freehold land		Buildings Computers	Office equipments	Plant and equipment	Leasehold improvements	Furniture and fixtures	Vehicles	Total
Gross block (at cost)
As at April 1, 2020	206 92	2.387.06	1.851 34	53.58	1.377.38	21.12	521 31	7.24	6.425.95
Additions	$\blacksquare$	0.54	103.73	5.32	5.48	-	8.20	$\blacksquare$	123.27
Disposals	۰.		6.52		0.24	۰.		۰	6.76
As at June 30, 2020	206.92	2,387.60	1,948.55	58.90	1,382.62	21 12	529.51	7 24	6,542.46
Accumulated depreciation
As at April 1, 2020	$\blacksquare$	1,061.11	1,548.74	50.93	1.190.54	19.32	502.49	4.05	4.377.18
Charge for the period	$\blacksquare$	24.05	47 41	3.45	10 33	0.36	4 0 1	0.23	89.84
Disposals	-		2.48	$\blacksquare$	0.24	۰	۰	۰	272
As at June 30, 2020	$\bullet$	1,085.16	1,593.67	54.38	1.200.63	19.68	506.50	4.28	4,464.30
Net block
As at June 30, 2020	206.92	1,302.44	354.88	452	181.99	1.44	23.01	2.96	2,078.16
As at March 31, 2020	206.92	1,325.95	302.60	2.65	186 84	1.80	18.82	3.19	2,048.77

5.2 Right of use assets

			(In $\bar{\tau}$ Million)
	Office premises	Leasehold land	Total
Gross block (at cost)
As at April 1, 2020	358.91	37.50	396.41
Additions	60 43	$\blacksquare$	60.43
As at June 30, 2020	419.34	37.50	456.84
Accumulated depreciation
As at April 1, 2020	126 41	0.60	127.01
Charge for the period	29.58	0.15	29.73
As at June 30, 2020	155.99	0.75	156 74
Net block
As at June 30, 2020	263 35	3675	300.10
As at March 31, 2020	232.50	36.90	269.40

5.1 Property, plant and equipment

									(In ₹ Million)
	Freehold land		Buildings Computers	Office equipments	Plant and equipment	Leasehold improvements	Furniture and fixtures	Vehicles	Total
Gross block (at cost)
As at April 1, 2020	206.92	2.387.06	1.851.34	53 58	1.377.38	21.12	521.31	7.24	6.425.95
Additions	$\blacksquare$	0.67	536.13	6.28	55.45		33.50	$\blacksquare$	632 03
Disposa _s	٠	۰	56.18	2.02	25.79	0.33	27.49	$\blacksquare$	11181
As at March 31, 2021	206.92	2,387.73	2,331.29	57.84	1,407.04	20.79	527 32	7 24	6,946.17
Accumulated depreciation
As at April 1, 2020	$\sim$	1.061.11	1.548.74	50 93	1.190.54	19.32	502.49	4.05	4.377.18
Charge for the year	$\blacksquare$	96.38	228.33	2.84	50.87	1.12	17.86	0.93	398 33
Disposals	٠	$\overline{\phantom{a}}$	44 17	202	25.76	0.25	27 38	$\blacksquare$	99.58
As at March 31, 2021	$\blacksquare$	1,157.49	1,732.90	5175	1,215.65	20.19	492.97	498	4,675.93
Net block
As at March 31, 2021	206.92	1,230.24	598.39	6.09	191.39	0.60	34 35	2.26	2,270.24
As at March 31, 2020	206.92	1,325.95	302 60	265	18684	180	1882	3.19	2,048.77

5.2 Right of use assets

UL NIGHT OF USE ASSELS
	Office	Leasehold	(In ₹ Million) Total
	premises	land
Gross block (at cost)
As at April 1, 2020	358 91	37.50	396.41
Additions	176.95	۰	176.95
Disposa s	92.69	$\blacksquare$	92.69
As at March 31, 2021	443 17	37.50	480.67
Accumulated depreciation
As at April 1, 2020	126 41	0.60	127.01
Charge for the year	111.12	0.58	111.70
Disposals	72.66	۰	72.66
As at March 31, 2021	164 87	1.18	166.05
Net block
As at March 31, 2021	278.30	36.32	314 62
As at March 31, 2020	232.50	36.90	269.40

Notes forming part of Condensed Interim Financial Statements

5.3 Other Intangible assets

			(In ₹ Million)
	Software	Acquired contractual rights	Total
Gross block
As at April 1, 2021	925 11	261.74	1.186.85
Additions	3385		33.85
As at June 30, 2021	958.96	261.74	1,220.70
Accumulated Amortization
As at April 1, 2021	753 46	261.74	1,015.20
Charge for the period	16.70		16.70
As at June 30, 2021	770.16	261.74	1.031.90
Net block
As at June 30, 2021	188.80	$\blacksquare$	188.80
As at March 31, 2020	171.65	$\blacksquare$	171.65

			(In ₹ Million)
	Software	Acquired contractual rights	Total
Gross block
As at April 1, 2020	743.67	261.74	1,005.41
Additions	147.65	$\blacksquare$	147.65
As at June 30, 2020	891.32	261.74	1,153.06
Accumulated Amortization
As at April 1, 2020	696.70	26174	958.44
Charge for the period	12 24		12.24
As at June 30, 2020	708.94	261.74	970.68
Net block
As at June 30, 2020	182.38	٠	182 38
As at March 31, 2020	46.97		46.97

			(In ₹ Million)
	Software	Acquired contractual rights	Total
Gross block
As at April 1, 2020	743.67	26174	1,005.41
Additions	181.44		181.44
As at March 31, 2021	925 11	261.74	1,186,85
Accumulated Amortization
As at April 1, 2020	696.70	261.74	958.44
Charge for the year	56.76	$\blacksquare$	56.76
As at March 31, 2021	753.46	261.74	1,015.20
Net block
As at March 31, 2021	171.65		171.65
As at March 31, 2020	46.97		46.97

5.4 Depreciation and amortization expense

			(In ₹ Million)
	For the quarter ended		For the year ended
	June 30, 2021	June 30, 2020	March 31, 2021
On Property, plant and equipment	116.83	89.84	398 33
On Right of use assets	29 18	29.73	111.70
On Other intangible assets	16.70	12.24	56.76
	162.71	131.81	566.79

Notes forming part of Condensed Interim Financial Statements

6. Non-current financial assets : Investments (refer note 30)

6. Non-current financial assets : Investments (refer note 30)
	As at June 30, 2021 In ₹ Million	As at June 30, 2020 In ₹ Million	As at March 31, 2021 In ₹ Million
Investments carried at cost Unquoted investments Investments in equity instruments - In wholly owned subsidiary companies (Refer note 31)
Persistent Systems, Inc. 402 million (Corresponding period/ Previous year: 402 million) shares of USD 0.10 each, fully paid up	2,478.01	2,478.01	2,478.01
	2,478.01	2,478.01	2,478.01
Persistent Systems Pte Ltd. 0.50 million (Corresponding period/ Previous year: 0.50 million) shares of SGD 1 each. fully paid up	15.50	15.50	15.50
	15.50	15.50	15.50
Persistent Systems France SAS 1.50 million (Corresponding period/ Previous year: 1.50 million) shares of EUR 1 each, fully paid up	97.47	97.47	97.47
	97 47	97 47	97.47
Persistent Systems Malaysia Sdn. Bhd. 5.45 million (Corresponding period/ Previous year: 5.45 million) shares of MYR 1 each, fully paid up	102.25	102 25	102 25
	102.25	102.25	102 25
Persistent Systems Germany GmbH 11.6527 million (Corresponding period/ Previous year: 11.6527 million) shares of EUR 1 each, fully paid up	1.265.91	1,265.91	1,265.91
	1,265.91	1,265.91	1,265.91
CAPIOT Software Private Limited 0.1867 million (Corresponding period Nil / Previous year: 0.1867) shares of Rs. 10 each, fully paid up	382 31		376.61
	382 31	$\blacksquare$	376.61
-In associates Klisma e-Services Private Limited [Holding 50% (Corresponding period/ Previous year: 50%)] 0.005 million (Corresponding period/ Previous year : 0.005 million) shares of ₹ 10 each,	0.05	0.05	0.05
fully paid up
Less : Impairment	(0.05)	(0.05)	(0.05)

Total investments carried at cost (A)	4,341.45	3.959.14	4,335.75
Investments carried at amortised cost Quoted Investments In bonds [Market value ₹ 2,909.38 million (Corresponding period: ₹ 2,321.86 million /Previous year ₹ 2,727 32 million)]	2,725.59	2,179.51	2.557 92
Add: Interest accrued on bonds	91.66	81.64	72.88
Total investments carried at amortised cost (B)	2,817 25	2,261.15	2,630.80
Designated as fair value through profit and loss
Quoted Investments - Investments in mutual funds Fair value of long term mutual funds (Refer Note 6 (a))	679.50 679.50	1,515.81 1,515.81	806 99 806.99
Unquoted Investments
-Others* Altizon Systems Private Limited 3,766 equity shares (Corresponding period / Previous year : 3,766 equity shares) of ₹10 each, fully paid up	6.00	6.00	6.00
	6.00	6.00	6.00
Total investments carried at fair value (C)	685.50	1,521 81	812.99
Total investments $(A) + (B) + (C)$	7,844.20	7,742 10	7,779.54
Aggregate provision for diminution in value of investments Aggregate amount of quoted investments Aggregate amount of unquoted investments	0.05 3,496.75 4,347.50	0.05 3,776.96 3,965.19	0.05 3,437.79 4,341.80

* Investments, where the Company does not have joint-control or significant influence including situations where such joint-control or significant
influence is intended to be temporary, are classified as "investments in ot

Notes forming part of Condensed Interim Financial Statements

6 (a) Details of fair value of investment in long term mutual funds (Quoted)

	As at	As at	As at
	June 30, 2021	June 30, 2020	March 31, 2021
	In ₹ Million	In ₹ Million	In ₹ Million
Axis Mutual Fund	354.96	678.33	400.50
IDFC Mutual Fund	324.54	453.03	370 31
Sundaram Mutual Fund		34 52	36.18
ICICI Prudential Mutual Fund		72.28
Kotak Mutual Fund		109.23
UTI Mutual Fund		72.41
Aditya Birla Sun Life Mutual Fund		23.96
PGIM India Mutual Fund (formerly known as DHFL Pramerica Mutual Fund)		35.97
DSP Mutual Fund		36.08
	679 50	1,515.81	806.99

7. Non-current financial assets : Loans (refer note 30)

	As at	As at	As at
	June 30, 2021	June 30, 2020	March 31, 2021
	In ₹ Million	In ₹ Million	In ₹ Million
Carried at amortised cost
Security deposits
Unsecured, considered good	106.53	121.61	52.23
	106.53	121.61	52.23
Other loans and advances
Unsecured, credit impaired	0.58	0.58	0.58
	0.58	0.58	0.58
Less: Impairment	(0.58)	(0.58)	(0.58)
	$\blacksquare$	$\blacksquare$	$\blacksquare$

	106.53	121.61	52.23

8. Other non-current financial assets (refer note 30)

	As at	As at	As at
	June 30, 2021	June 30, 2020	March 31, 2021
	In ₹ Million	In ₹ Million	In ₹ Million
Non-current bank balances (refer note 14)	41.26	344.42	24 42
Add: Interest accrued but not due on non-current bank deposits (refer note 14)	0.05	20.42	1.34
Non-current deposits with banks (carried at amortised cost)	41.31	364 84	25.76
Deposit with financial institutions	430.00	430.00	430.00
Add: Interest accrued but not due on deposit with financial institutions	0.98	0.98	0.98
Less: Credit impaired	(430.98)	(430.98)	(430.98)
Non-current deposits with financial institutions (carried at amortised cost)

	41.31	364 84	2576

9. Deferred tax assets (net)

	As at	As at	As at
	June 30, 2021	June 30, 2020	March 31, 2021
	In ₹ Million	In $\bar{\tau}$ Million	In ₹ Million
Deferred tax liabilities
Differences in book values and tax base values of block of Property, plant and equipment	38.71	24 82	41.87
and other intangible assets
Capital gains (net)	67.45	58.93	61.06
Others		5.04
	106.16	88.79	102.93
Deferred tax assets
Provision for leave encashment	84 36	58.02	9576
Provision for long service awards	66.50	55.19	64.97
Provision for expected credit loss	26.91	42.44	28.85
Tax credit	65.97	73.17	62.37
Right of use asset and lease liability	26.09	30.15	26 36
Others	102.36	148.70	70 36
	372.19	407.67	348.67

Deferred tax assets (net)	266.03	318.88	24574

Notes forming part of Condensed Interim Financial Statements

10. Other non-current assets

As at	As at	As at
June 30, 2021	June 30, 2020	March 31, 2021
In ₹ Million	In ₹ Million	In ₹ Million
93.32	42.14	38.75
80.79	11.03	84 43
296.55	296.55	296.55
470.66	349.72	419.73

Current financial assets : Investments (refer note 30)

	As at	As at	As at
	June 30, 2021	June 30, 2020	March 31, 2021
	In ₹ Million	In ₹ Million	In ₹ Million
Designated as fair value through profit and loss
Quoted investments
Investments in mutual funds
Fair value of current mutual funds (refer note '11(a)' below)	9.292.04	3.451.38	6.374.95
Total carrying amount of investments	9.292.04	3.451.38	6,374.95

Aggregate amount of quoted investments	9.292.04	3.451.38	6.374.95
Aggregate amount of unguoted investments

11(a) Details of fair value of current investment in mutual funds (Quoted)

	As at	As at	As at
	June 30, 2021	June 30, 2020	March 31, 2021
	In ₹ Million	In ₹ Million	In $\bar{\tau}$ Million
HDFC Mutual Fund	1.511.18	634 84	963 10
Aditva Birla Sun Life Mutual Fund	1.268.25	227.42	1.011.03
IDFC Mutual Fund	1.213.11	825.71	91172
UTI Mutual Fund	1.192.17	232.54	723 19
Axis Mutual Fund	1.184.73	286.68	824.68
SBI Mutual Fund	789.08	285.76	166 36
ICICI Prudential Mutual Fund	760.64	423.09	710.33
Kotak Mutual Fund	484.28	151.98	478 21
L&T Mutual Fund	435.26	70.01	51171
DSP Mutual Fund	160.04	250.02	37.38
Sundaram Mutual Fund	155.37	۰
Tata Mutual Fund	100.36
PGIM India Mutual Fund (formerly known as DHFL Pramerica Mutual Fund)	37.57		37.24
Nippon India Mutual Fund (formerly known as Reliance Mutual Fund)		63.33
	9.292.04	3.451.38	6.374.95

Notes forming part of Condensed Interim Financial Statements

12. Trade receivables (refer note 30)

	As at	As at	As at
	June 30, 2021	June 30, 2020	March 31, 2021
	In ₹ Million	In ₹ Million	In ₹ Million
Unsecured, considered good*	3,451.46	3,433.90	2.966.26
Unsecured, credit impaired	106 90	168.62	118.29
	3,558.36	3,602.52	3,084.55
Less: Allowance for expected credit loss	(106.90)	(168.62)	(118.29)
	3.451.46	3.433.90	2,966.26
	3.451.46	3.433.90	2,966.26
*Includes dues from related parties (refer note 31)

13. Cash and cash equivalents (refer note 30)

	As at	As at	As at
	June 30, 2021	June 30, 2020	March 31, 2021
	In ₹ Million	In ₹ Million	In ₹ Million
Cash and cash equivalents as presented in cash flow statement
Cash on hand	0.18	0.10	0.10
Balances with banks
On current accounts#	442.18	83.05	360 22
On saving accounts	7.50	0.17	1.33
On Exchange Earner's Foreign Currency accounts	265.97	355.97	208.57
On Deposit accounts with original maturity less than three months		22.00	292 50
	715.83	461.29	862.72

Out of the cash and cash equivalent balance as at June 30, 2021, the Company can utilise ₹ 227.86 million (Corresponding period: ₹ 9.12 million/ Previous year: ₹ 154,39 million) only towards certain predefined activities specified in the agreement.

14. Other bank balances (refer note 30)

	As at	As at	As at
	June 30, 2021	June 30, 2020	March 31, 2021
	In ₹ Million	In ₹ Million	In ₹ Million
Deposits with banks*	4,889.26	5.741.92	7.108.47
Add: Interest accrued but not due on deposits with banks	131.58	103.53	301 29
Deposits with banks (carried at amortised cost)	5.020 84	5.845.45	7.409.76
Less: Deposit with maturity more than twelve months from the Balance Sheet date disclosed under non-current financial assets (refer note 8)	(41.26)	(344.42)	(24.42)
Less: Interest accrued but not due on non-current deposits with banks (refer note 8)	(0.05)	(20.42)	(1.34)
	4.979.53	5,480.61	7,384.00
Balances with banks on unpaid dividend accounts**	3.14	2.70	3.00
	4.982.67	5.483.31	7.387.00

* Out of the balance, fixed deposits of ₹ 646.58 million (Corresponding period: ₹ 673.71 million/ Previous year : ₹ 675.89 million) have been earmarked against credit facilities and bank guarantees availed by the Company.

** The Company can utilize these balances only towards settlement of the respective unpaid dividend.

Notes forming part of Condensed Interim Financial Statements

15. Current financial assets : Loans (refer note 30)

	As at	As at	As at
	June 30, 2021	June 30, 2020	March 31, 2021
	In ₹ Million	In ₹ Million	In ₹ Million
Carried at amortised cost
Loan to related parties (Refer note 31)
Unsecured, credit impaired
- Klisma e-Services Private Limited	27.43	27.43	27 43
	27.43	27.43	27.43
Less: Impairment	(27.43)	(27.43)	(27.43)
	$\overline{\phantom{a}}$	۰
Security deposits
Unsecured, considered good	0.10	0,10	49.33
	0.10	0.10	49.33
	0.10	0.10	49.33

16. Other current financial assets (refer note 31)

	As at	As at	As at
		June 30, 2021 June 30, 2020	March 31, 2021
	In ₹ Million	In ₹ Million	In ₹ Million
Fair value of derivatives designated as hedging instruments
Forward contracts receivable	123.65		294.46
Advances to related parties (Unsecured, considered good) (refer note 31)
Persistent Systems, Inc.		77.20	18.72
Persistent Systems France SAS	0.50	4.39	0.38
Persistent Telecom Solutions Inc.	0.12	3.11	0.01
Persistent Systems Malaysia Sdn. Bhd.	0.07	0.15	$\sim$
Persistent Systems Lanka (Private) Limited	0.15	2.67	0.02
Aepona Limited	3.32		2 3 4
Aepona Group Limited	0.04
PARX Consulting GmbH	0.06	0.04
Persistent Systems Israel Ltd.	0.07	0.71
Persistent Systems Mexico, S.A. de C.V.	0.08	1.13
Youperience GmbH	0.04	0.05
PARX Werk AG	0.09	1.89
Persistent Systems Pte. Ltd.	0.10	×.
Persistent Systems Germany GmbH	0.04	0.63
Youperience Limited	0.04	$\blacksquare$
	4.72	91.97	21.47
Advances to related parties (Unsecured, credit impaired) (refer note 31)
Klisma e-Services Private Limited	0.81	0.81	0.81
Less: Impairment of current financial assets	(0.81)	(0.81)	(0.81)
	$\overline{\phantom{a}}$	$\overline{\phantom{a}}$	$\overline{\phantom{a}}$
Other advances	16.09		21.79
Unbilled revenue	2.441.34	1.833.69	1.726.07
	2.585.80	1.925.66	2,063.79

17. Other current assets

	As at June 30, 2021 In ₹ Million	As at	As at March 31, 2021
		June 30, 2020
		In ₹ Million	In ₹ Million
Advances to suppliers (Unsecured, considered good)
Advances recoverable in cash or kind or for value to be received	714.49	571.98	388.32
Excess fund balance with Life Insurance Corporation	39.60	137.69	113.08
Other advances (Unsecured, considered good)
VAT receivable (net)	35.01	31.50	23.44
Service tax and GST receivable (net) (refer note 32(a))	914.26	990.74	1,132.09
	949.27	1.022.24	1,155.53
	1,703.36	1,731.91	1,656.93

Notes forming part of Condensed Interim Financial Statements

18. Non-current financial liabilities : Borrowings (refer note 30)

	As at	As at	As at
	June 30, 2021 In ₹ Million	June 30, 2020		March 31, 2021
		In ₹ Million	In ₹ Million
Unsecured Borrowings carried at amortised cost
Term loans
Indian rupee loan from others	7.39	11.93	7.39
Interest accrued but not due on term loans	0.17	0.24	0.11
	7.56	12.17	7.50
Less: Current maturity of long-term borrowings transferred to other current financial liabilities (Refer note 22)	(1.85)	(4.58)	(1.85)
Less: Current maturity of interest accrued but not due on term loan transferred to other current financial liabilities (Refer note 22)	(0.17)	(0.24)	(0.11)
	(2.02)	(4.82)	(1.96)
	5.54	7.35	5.54

The term loans from Government departments have the following terms and conditions:

Loan I - amounting to ₹ 7.39 million (Corresponding period ₹ 9.24 / Previous year ₹ 7.39 million) with Interest payable @ 3% per annum
repayable in ten equal annual installments over a period of ten years commencing from

Loan II - amounting to Nil (Corresponding period ₹ 2.69 million / Previous year Nil) with interest payable @ 2% per annum has been
guaranteed by a bank guarantee by the Company and was repayable in ten equal semi annual i

19. Non current liabilities : Provisions

As at	As at	As at
June 30, 2021	June 30, 2020	March 31, 2021
In ₹ Million	In ₹ Million	In ₹ Million

245.01	194.49	240 94
245.01	194.49	240 94

Notes forming part of Condensed Interim Financial Statements

20. Lease liabilities (refer note 30)

	As at	As at	As at
	June 30, 2021	June 30, 2020	March 31, 2021
	In ₹ Million	In ₹ Million	In ₹ Million
Lease liabilities	657 67	377.58	378 54
Less: Current portion of lease liabilities	(107.25)	(162.34)	(73.82)
	550.42	215.24	304.72

Movement of lease liabilities
	For the quarter ended		For the year ended
	June 30, 2021	June 30, 2020	March 31, 2021
	In ₹ Million	In ₹ Million	In ₹ Million
Opening balance	378.54	356.64	356.64
Additions	302 65		176 95
Deletions		60.43	(20.03)
Add: Interest recognised during the period / year	1844	8.69	38.09
Less: Payments made	(41.96)	(48, 18)	(173.11)
Closing balance	657.67	377.58	378.54

21. Trade payables (refer note 30)

	As at	As at	As at
	June 30, 2021	June 30, 2020	March 31, 2021
	In ₹ Million	In ₹ Million	In ₹ Million
Trade payables for goods and services*	1.199.54	971 15	938 40
I(dues of micro and small enterprises ₹ 10.68 million (Corresponding period: ₹ 2.22 million/
Previous year: ₹ 30.20 million)1
	1.199.54	971.15	938.40
*Includes dues payable to related parties (refer note 31)

Disclosure of payable to vendors as defined under the "Micro, Small and Medium Enterprise Development Act, 2006" is based on the information available with Discussion of payable contained and the Said Act, as per the infinition received from them on requests made by the Company
There are no overdue principal amounts / interest payable amounts for delayed payments to such vend

22. Other current financial liabilities (refer note 30)

	As at	As at	As at
	June 30, 2021	June 30, 2020	March 31, 2021
	In ₹ Million	In ₹ Million	In ₹ Million
Capital creditors	26.63	53.84	237 83
Current maturity of long term borrowings (refer note 18)	185	4.58	1.85
Current maturity of interest on long-term borrowings (refer note18)	0.17	0.24	0.11
Accrued employee liabilities	150.45	100.65	154 58
Unpaid dividend *	3.14	270	3.00
Other liabilities	8.46	8.00	0.05
Fair value of derivatives designated as hedging instruments
Forward contracts payable		177.22
Advance from related parties (Unsecured, considered good) (refer note 31)
Persistent Systems Pte Ltd		2.83
Persistent Systems, Inc.	7.83
PARX Werk AG		2.82
Aepona Limited		1.15
	7.83	6.80	$\blacksquare$
	198 53	354.03	397.42

* Unpaid dividend is credited to Investor Education and Protection Fund as and when due

Notes forming part of Condensed Interim Financial Statements

23. Other current liabilities

	As at	As at	As at
	June 30, 2021	June 30, 2020	March 31, 2021
	In ₹ Million	In ₹ Million	In $\bar{\epsilon}$ Million
Unearned revenue	306.50	142.83	260.40
Advance from customers	909.25	479.40	1.023.53
Other payables
- Statutory liabilities	311.10	180.59	228.03
- Other liabilities*	233.18	3.39	167.05
	1,760.03	806.21	1.679.01

*Includes balance of ₹ 227.69 million (Corresponding period: Nil / previous year: ₹ 154.16 million ) to be utilised against certain predefined activities specified in
the agreement.

24. Current liabilities : Provisions

	As at	As at	As at
	June 30, 2021	June 30, 2020	March 31, 2021
	In ₹ Million	In ₹ Million	In ₹ Million
Provision for employee benefits
- Leave encashment	335.18	230.54	380.49
- Long service awards	19.21	24.80	17.19
- Other employee benefits	463.47	302.96	747 91
	81786	558.30	1.145.59

Notes forming part of Condensed Interim Financial Statements

25. Revenue from operations (net) (refer note 31)

	For the quarter ended		For the year ended
	June 30, 2021	June 30, 2020	March 31, 2021
	In ₹ Million	In ₹ Million	In ₹ Million
Software services	7.564.96	5.549.17	24.270.63
Software licenses	83 38	12 21	525.45
	7.648.34	5,561.38	24,796.08

26. Other income

	For the quarter ended		For the year ended
	June 30, 2021 In ₹ Million	June 30, 2020 In ₹ Million	March 31, 2021 In $\bar{\tau}$ Million
Interest income
On deposits carried at amortised cost	71.71	84.68	381.66
On others	45.98	39.24	167.16
Foreign exchange (loss) / gain (net)	82 21	(80.28)	67.12
Profit on sale of Property, plant and equipment (net)	0.03	0.02	8.10
Dividend income from investments*		94 56	131.45
Profit on sale of investments (net)	106 48	291.18	478.13
Net gain/(loss) arising on financial assets designated as FVTPL	2.21	(155.61)	(133.70)
Miscellaneous income	36.06	19.97	76.24
	344.68	293.76	1.176.16

*includes dividend received from investment in wholly owned subsidiaries. (Refer note 31)

27 Personnel expenses

	For the quarter ended	For the year ended
	June 30, 2021	June 30, 2020	March 31, 2021
	In ₹ Million	In ₹ Million	In ₹ Million
27.1 Employee benefits expense
Salaries, wages and bonus	3.989.69	2.825.07	12,806.57
Contribution to provident and other funds	226 83	131.67	666.24
Staff welfare and benefits	94 95	77.91	384.07
Share based payments to employees	130 07	22.61	236.33
	4.441.54	3.057.26	14.093.21
27 2 Cost of professionals
- Related parties (refer note 31)	146.79	331.11	1.323.73
- Others	190.46	46.59	451 34
	337 25	377.70	1,775.07

	4,778.79	3,434.96	15,868.28

Notes forming part of Condensed Interim Financial Statements

28. Other expenses*

	For the quarter ended	For the year ended
	June 30, 2021	June 30, 2020	March 31, 2021
	In ₹ Million	In ₹ Million	In ₹ Million
Travelling and conveyance	40.85	26.73	39.58
Electricity expenses (net)	11.48	14.27	6909
Internet link expenses	13.57	21.27	50.14
Communication expenses	14.03	21.61	73.17
Recruitment expenses	55.43	7.64	75.40
Training and seminars	11.19	6.37	23.97
Purchase of software licenses and support expenses	276.71	188.96	908.00
Bad debts			46 96
Provision for expected credit loss (net)	(6.37)	35.22	(20.20)
Rent	15.63	22.46	77.50
Insurance	10.66	8.32	31 37
Rates and taxes	7.41	6.93	52.57
Legal and professional fees	56.92	42.60	196.13
Repairs and maintenance
- Plant and Machinery	22.94	28.53	94 92
- Buildings	4.60	4.51	19.26
- Others	5.40	5.54	15.20
Selling and marketing expenses	205.22	157.16	739.82
Advertisement, conference and sponsorship fees	0.99	0.34	3 5 4
Computer consumables	1.54	0.10	3 1 4
Auditors' remuneration	1.05	1.25	9.00
Donations	35.00	61.91	163.93
Books, memberships, subscriptions	1.60	3.90	12.69
Directors' sitting fees	2.28	0.99	484
Directors' commission	7.06	2.96	1022
Miscellaneous expenses	27.96	34 53	118.52
	823 15	704.10	2,818.76
* Includes expenses incurred with related parties (refer note 31)

Notes forming part of Condensed Interim Financial Statements

Earnings per share

		For the quarter ended	For the year ended
		June 30, 2021	June 30, 2020	March 31, 2021
Numerator for Basic and Diluted EPS Net Profit after tax (In ₹ Million)	(A)	1.660.95	1.214 76	5,050.86
Denominator for Basic EPS Weighted average number of equity shares	(B)	76.425.000	76.425.000	76,425,000
Denominator for Diluted EPS Number of equity shares	(C)	76,425,000	76.425,000	76.425,000
Basic Earnings per share of face value of ₹ 10 each (In ₹)	(A/B)	21.73	15.89	66.09
Diluted Earnings per share of face value of ₹ 10 each (In ₹)	(AVC)	21.73	15.89	66.09

	For the quarter ended	For the year ended
	June 30, 2021	June 30, 2020	March 31, 2021
Number of shares considered as basic weighted average shares outstanding	76.425.000	76.425.000	76.425.000
Add: Effect of dilutive issues of stock options		-
Number of shares considered as weighted average shares and potential shares outstanding	76.425.000	76.425.000	76.425,000

Notes forming part of Condensed Interim Financial Statements

30. Financial assets and liabilities

The carrying values and fair values of financial instruments by categories are as follows:

						(In ₹ million)
Financial assets/ financial liabilities	Basis of measurement		As at June 30, 2021		As at June 30, 2020		As at March 31, 2021
		Carrying value	Fair value	Carrving value	Fair value	Carrving value	Fair value
Assets:
Investments in subsidiaries and associates (net)	Cost	4,341.45	4,341.45	3,959.14	3.959 14	4,335.75	4,335.75
Investments in equity instruments	Fair value	6.00	6.00	6.00	6.00	6.00		6.00 Level 3
Investments in bonds*	Amortised cost	2.817.25	2,909.38	2.261.15	2.321.86	2.630.80	2,727.32
Investments in mutual funds	Fair value	9,971.54	9,971.54	4,967.19	4,967.19	7,181.94	7,181.94 Level 1
Loans	Amortised cost	106.63	106 63	121.71	121.71	101 56	101 56
Deposit with banks and financial institutions (including interest accrued but not due on deposits with banks)	Amortised cost	5.020 84	5,020 84	5,845.45	5.845.45	7.409.76	7,409.76
Cash and cash equivalents (including unpaid dividend)	Amortised cost	718.97	718 97	463.99	463.99	865.72	86572
Trade receivables (net)	Amortised cost	3,451.46	3.451.46	3,433 90	3,433.90	2,966.26	2,966.26
l Forward contracts receivable	Fair value	123 65	123.65			294 46		294 46 Level 2
Unbilled revenue	Amortised cost	2.441.34	2.441.34	1,833.69	1.833.69	1,726.07	1,726.07
Other current financial assets	Amortised cost	20.81	20.81	91.97	91.97	43.26	43.26
Total		29.019.94	29.112.07	22.984.19	23.044.90	27.561.58	27,658.10
Liabilities:
Borrowings (including accrued interest)	Amortised cost	7.56	7.56	12.17	12.17	7.50	7.50
Trade payables	Amortised cost	1,199.54	1.199.54	593.57	593.57	938 40	938 40
Lease liabilities	Amortised cost	657.67	657.67	377.58	377 58	378.54	378.54
Other financial liabilities (excluding borrowings)	Amortised cost	196.51	196.51	549.57	549.57	395.46	395.46
Forward contracts payable	Fair value			177.22	177.22			Level 2
Total		2.061.28	2,061.28	1.710.11	1.710.11	1.719.90	1.719.90

* Fair value includes interest accrued.

Fair value hierarchy:

The fair value hierarchy is based on inputs to valuation techniques that are used to measure fair value that are either observable or unobservable and consists of the following three levels: Level 1— Inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities.

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

Level 3 — Inputs are not based on observable market data (unobservable inputs). Fair values are determined in whole or in part using a valuation model based on assumptions that are neither supported by
prices from observab

Notes forming part of Condensed Interim Financial Statements

31. Related Party Transactions

Refer to the Company's Annual Report for the year ended March 31, 2021 for the full names and other details of the Company's subsidiaries and associates.

The Company's significant related party transactions during the period ended and outstanding balances as at June 30, 2021, June 30, 2020 and March 31, 2021 are with its subsidiaries with whom the Company generally enters into transactions which are at arms length and in the ordinary course of business

The Company acquired 100% share capital of CAPIOT Software Private Limited, a company based in India, with effect from October 29, 2020. (Refer note 6)

32. Contingent liabilities

$(a)$ Persistent Systems Limited ("the Company") had received a show cause notice from the Commissioner of Service Tax on December 19, 2016 for non-payment of service tax of ₹ 452.15 million under import of services on reverse charge basis, excluding interest and penalty, if applicable. The issue relates to the professional and technical services rendered by overseas subsidiaries on behalf of the Company to its overseas customers for the period 2011-12 to 2014-15

Post representations made by the Company, the Learned Principal Commissioner of Service Tax, Pune, adjudicated the aforesaid show-cause notice and issued an order on May 29, 2017, reducing the demand to ₹173.78 million based on the period of limitation and as a result of that, the said demand now covers financial year 2014-15. The Company has filed an appeal against the order passed by Learned Principal Commissioner of Service Tax, Pune with the Hon ble Central Excise and Service Tax Appellate Tribunal (CESTAT) on September 23, 2017

The Company, based on independent legal opinion obtained in respect of issues related to this matter, believes that the liability is not likely to arise and therefore, no provision is considered necessary in the financial statements. If the appeal filed as mentioned above results in a demand, there will be no impact on the profitability as the Company will be eligible to claim credit/refund for the amount paid.

The GST department has filed an appeal on October 11, 2017 with appellate authorities against the Order passed by Learned Principal Commissioner of Service Tax, Pune. Though the GST department has acknowledged the ground of revenue neutrality, the said appeal mainly questions non-application of extended period of limitation. The Company has filed reply to this appeal on December 18, 2017.

Considering the view of the Service Tax Authorities, based on legal advice and due prudence, the Company has deposited, an amount of ₹647.36 million towards service tax in respect of the above matter, for the period from April 01, 2014 to June 30, 2017, under protest. This balance, post adjustment of service tax liability of ₹17.76 million for the month of June 2017 (i.e. net amount of ₹629.60 million) was considered as transitional credit under GST Regime and recorded accordingly as GST receivable. The disputed demand currently stands at ₹ 173.78 million towards which ₹ 165.58 million was paid under protest and forms part of the aforementioned GST receivable balance.

As on June 30, 2021, the pending litigations in respect of direct taxes amount to ₹463.61 million (Corresponding period ₹ 220.30 million / Previous $(b)$ year: ₹ 478.79 million) and in respect of indirect taxes amount to ₹ 35.13 million (Corresponding period ₹ 27.33 million / Previous year: ₹ 27.33 million) (excluding the show cause notice received from Commissioner of Service Tax on May 29, 2017 of ₹ 173.78 million (corresponding period/ previous year ₹ 173.78 million) under import of services on reverse charge basis as mentioned above). Based on the advice obtained and .
judgments in favour of the Company at the first appellate authority in the earlier years, management does not expect any outflow in respect of these litigations.
In respect of export incentives pertaining to previous periods amounting to ₹ 255.52 million (Corresponding period / previous year ₹ 255.52 million), $(c)$ which have been refunded under protest with interest of ₹41.03 million (Corresponding period / previous year ₹41.03 million), the Company filed an application with Directorate General of Foreign Trade (DGFT). The Company has also represented with industrial association, The National Association of Software and Service Companies (NASSCOM), to ensure continued applicability of such incentives to the eligible information technology companies. The Company understands from NASSCOM that they have also taken up the matter with concerned authorities. The Company in the previous year has received a Show Cause Notice from the Directorate Of Revenue Intelligence (DRI), in which the DRI has raised certain additional matters with applicable penalties which relates to eligibility of company to seek the incentives. Based on the documents filed with relevant authorities and based on the consultations with subject matter specialists, the Company believes that its position is likely be upheld on ultimate resolution and accordingly, no provision is necessary to be made against such claims in these condensed interim financial statements,
Persistent Systems Ltd has given a performance guarantee up to \$ 10 million to HSBC Bank USA in respect of payment obligations under the $(d)$ Receivables Purchase agreement entered into by Persistent Systems Inc with HSBC Bank, USA (Corresponding period/ Previous year: \$10 million). Persistent Systems Ltd. has also given performance guarantee up to \$ 5 million to Citibank USA (Corresponding period/ Previous year: \$ 5 million) in respect of working capital facilities for Persistent Systems Inc. and \$ 0.17 million to Sun Life Assurance Company of Canada for timely payment of rent instalments and damages, in respect of office rented to Persistent Systems Inc.

Notes forming part of Condensed Interim Financial Statements

33 The Company has deposits of ₹430 million with the financial institutions viz. Infrastructure Leasing & Financial Services Ltd. (IL&FS) and IL&FS Financial Services Ltd. (referred to as "IL&FS Group") as on the balance sheet date. These were due for maturity from January 2019 to June 2019. In view of the uncertainty prevailing with respect to recovery of outstanding balances from IL&FS Group, Management of the Company has fully provided for these deposits along with interest accrued thereon till the date the deposits had become doubtful of recovery. The Management is hopeful of recovery though with a time lag. The Company continues to monitor developments in the matter and is committed to take steps including legal action that may be necessary to ensure full recovery of the said deposits.
34 The Company has recognized notional interest on lease liability of ₹ 18.44 million (Corresponding period ₹ 8.69 million / previous year: ₹ 38.09 million) under finance cost as required by Ind AS 116: Leases.
35 The Indian Paniament has approved the Code on Social Security, 2020 which would impact the contributions by the company towards Provident Fund and Gratuity. The Ministry of Labour and Employment has released draft rules for the Code on Social Security, 2020 on November 13, 2020, and has invited suggestions from stakeholders which are under active consideration by the Ministry. The Company will assess the impact and its evaluation once the subject rules are notified and will give appropriate impact in its financial statements in the period in which, the Code becomes effective and the related rules to determine the financial impact are published.
36 The condensed interim financial statements are presented in ₹ Million and decimal thereof except for per share information or as otherwise stated.
37 Previous period's / year's figures have been regrouped where necessary to conform with the current year's classification.

For Walker Chandiok & Co LLP Chartered Accountants Firm Registration No.: 001076N/N500013

SHASHI

Digitally signed by SHASHI TADWALKAR TADWALKAR Date: 2021.07.22

Shashi Tadwalkar

Partner Membership No: 101797 For and on behalf of the Board of Directors of Persistent Systems Limited

MWKulu

Arrand Deshpande

Dr. Anand Deshpande Chairman and Managing Director DIN: 00005721

Sandeep Kalra Executive Director and Chief Executive Officer DIN: 02506494

Praveen Kadle Independent Director

Place: Pune Date: July 22, 2021

Place: Mumbai Date: July 22, 2021

DIN: 00016814

Date: July 22, 2021

Place: Pune

Sunil Sapre

Sunil Sapre Executive Director and Chief Financial Officer DIN: 06475949

Amit Atre

Amit Atre Company Secretary

Membership No. A20507

Date: July 22, 2021

Place: Pune Date: July 22, 2021 Place: Pune Date: July 22, 2021

Place: Pune

AI assistant

Persistent Systems Limited — Interim / Quarterly Report 2021

60826_rns_2021-07-22_5409ddc1-a677-4f60-80b3-91c8a3771fd5.pdf

Sub: Audited Unconsolidated Financial Statements for the quarter ended June 30, 2021 Ref: Our earlier intimations under reference no. NSE & BSE / 2021-22 / 62A dated July 22, 2021

To the Members of Persistent Systems Limited

Report on the Audit of the Condensed Interim Standalone Financial Statements

Basis for Opinion

Persistent Systems Limited on the Audit of the Condensed Interim Standalone Financial Statements

Responsibilities of Management and Those Charged with Governance for the Standalone Financial Statements

Condensed Interim Financial Statements

Persistent Systems Limited on the Audit of the Condensed Interim Standalone Financial Statements

For Walker Chandiok & Co LLP Chartered Accountants

UDIN:21101797AAAABU6970

Digitally signed bySHASHI TADWALKAR SHASHI TADWALKAR Date: 2021.07.22

For and on behalf of the Board of Directors of Persistent Systems Limited

Place: PuneDate:July 22, 2021

Arrand Deshpande

Out of the cash and cash equivalent balance as at June 30, 2021, the Company can utilise ₹ 227.86 million (Corresponding period: ₹ 9.12 million/ Previous year: ₹ 154.39 million) only towards certain predefined activities specified in the agreement.

Arrand Deshpande

Sadeey below MWkulu

Sunil Sapre

(In ₹ Million)

(In ₹ Million)

Firm Registration No.: 001076N/N500013

Arrand Deshpande

Sunil Sapre

Nature and purpose of reserves

a) Securities premium

b) General reserve

c) Share options outstanding reserve

d) Capital redemption reserve

e) Special Economic Zone re-investment reserve

f) Cash flow hedge reserve

Notes forming part of Condensed Interim Financial Statements

1. Nature of operations

$2.$ Basis of preparation

Summary of significant accounting policies 3.

(a) Use of estimates

B. Estimation of uncertainties relating to the global health pandemic from COVID-19:

(i) Expected credit loss:

(ii) Impact on hedged and unhedged foreign currency exposure:

(iii) Carrying value of financial instruments:

(iv) Impact on revenue:

C. Critical accounting estimates

i. Revenue recognition

ii. Income taxes

iii. Property, Plant and Equipment

iv. Provisions

v.Leases

(b) Property, Plant and Equipment

(c) Intangible assets

Research and development cost

(d) Depreciation and amortization

Notes forming part of Condensed Interim Financial Statements

(e) Borrowing costs

$(f)$ Leases

Where the Company is a lessee

Company as a lessor

(g) Financial instruments

Initial recognition and measurement

A. Non-derivative financial instruments

Subsequent measurement

(i) Financial Assets

Financial assets at amortized cost

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

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

(ii) Financial Liabilities

Financial liabilities at amortized cost

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

Investments in subsidiaries, associates and joint ventures

B. Derivative financial instruments

C. Derecognition

D. Fair value of financial instruments

E. Impairment of financial assets

F. Impairment of Non-Financial assets

(h) Revenue recognition

$(i)$ Income from software services and products

(ii) Interest

(iii) Dividend

$(i)$ Government grants

Persistent Systems Limited Interim / Quarterly Report 2021

Digitally signed by
SHASHI TADWALKAR SHASHI TADWALKAR Date: 2021.07.22

Place: Pune
Date:July 22, 2021