Company: ZCARW
Filing Date: 2025-08-14
Form Type: 10-Q
Source: 0001213900-25-076590
Chunk: 24

Company: Zoomcar Holdings, Inc.
Filing Date: 2025-08-14
Form: 10-Q
Item: Part I, Item 1
Chunk 24
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 constructive obligation as a result of a past event, and
it is probable that an outflow of economic benefits will be required to settle the obligation. If the effect is material, provisions are
recognized at present value by discounting the expected future cash flows at a pre-tax rate that reflects current market assessments of
the time value of money.

Provisions for onerous contracts
are recognized when the expected benefits to be derived by the Company from a contract are lower than the unavoidable costs of meeting
the future obligations under the contract.
The provision is measured at the present value of the lower of the expected cost of terminating the contract and the expected net cost
of continuing with the contract. Before a provision is established, the Company recognizes any impairment loss on the assets associated
with that contract. The Company does not have any onerous contracts.

19

ZOOMCAR HOLDINGS, INC.NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

xxv.Fair value measurements and financial instruments

Fair value is defined as the price
that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement
date. In accordance with ASC 820, Fair Value Measurement (“ASC 820”), the Company uses the fair value hierarchy, which prioritizes
the inputs used to measure fair value. The hierarchy, as defined below, gives the highest priority to unadjusted quoted prices in active
markets for identical assets or liabilities and the lowest priority to unobservable inputs. The three levels of the fair value hierarchy
are set forth below:

    Level 1
    Observable inputs such as quoted prices in active markets for identical assets or liabilities.

    Level 2
    Observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities in active markets, quoted prices in markets that are not active or inputs other than the quoted prices that are observable either directly or indirectly for the full term of assets or liabilities.

    Level 3
    Unobservable inputs in which there is little or no market data and that are significant to the fair value of the assets or liabilities.

During the three months ended
June 30, 2025, the Company’s primary financial instruments included cash and cash equivalents, investments, accounts receivables,
other financial assets, accounts payable, debt, unsecured convertible note and other financial liabilities. The estimated fair value of
cash equivalents, accounts receivable, accounts payable and accrued liabilities approximate their carrying value