Company: ZCARW
Filing Date: 2025-02-14
Form Type: 10-Q
Source: 0001213900-25-014437
Chunk: 254

Company: Zoomcar Holdings, Inc.
Filing Date: 2025-02-14
Form: 10-Q
Item: Part I, Item 8
Chunk 254
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estimated fair value of cash equivalents, accounts receivable, accounts payable, redeemable promissory note and accrued liabilities approximate
their carrying value due to short-term maturities of these instruments.

(o)Troubled debt restructuring

As
per ASC 470-60 Troubled Debt Restructuring (TDR) refers to a situation where the creditor, grants concessions to a borrower experiencing
financial difficulties. These concessions may include modifications to the terms of the payable, such as reducing the interest rate,
extending the repayment period, or forgiving a portion of the payable. Such restructuring is done with the intent to provide relief to
the borrower and to maximize the potential for payable recovery by the Company.

In
accordance with ASC 470-60, when the total future cash payments under the new terms are less than the carrying amount of the payable
at the date of restructuring, the difference between the carrying amount and the total future cash payments is recognized as a ‘Gain
on Troubled Debt Restructuring’ in the Condensed Consolidated Financial Statements. This gain is recorded immediately in the period
the restructuring occurs.

If
the total future cash payments under the new terms exceed the carrying amount of the payable at the date of restructuring, no adjustment
to the carrying amount of the payable is made. Instead, the company calculates a New Effective Interest Rate (EIR) based on the revised
terms of the restructured payable. The debt is then amortized over the remaining life of the payable using the new EIR, with interest
expense recognized based on this rate in future periods.

20

ZOOMCAR HOLDINGS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(p)Segment information

Operating
segments are defined as components of an entity for which discrete financial information is available and is regularly reviewed by the
Chief Operating Decision Maker (“CODM”) in making decisions regarding resource allocation and performance assessment. The
Company’s CODM is its Board of Directors. The Company has determined it has one operating and reportable segment as the CODM reviews
financial information presented on a consolidated basis for purposes of allocating resources and evaluating financial performance.

(q)Common Stock Reverse Split

In
October 2024, the Company effectuated a one-for-hundred reverse stock split. All share, stock option and warrant information has been
retroactively adjusted to reflect these stock splits. See Note 3 for additional disclosure.

(r)Recent Accounting Pronouncements

Accounting Pronouncement Pending