Company: ZCARW
Filing Date: 2025-11-14
Form Type: 10-Q
Source: 0001213900-25-110391
Chunk: 30

Company: Zoomcar Holdings, Inc.
Filing Date: 2025-11-14
Form: 10-Q
Item: Part I, Item 1
Chunk 30
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’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
due to short-term maturities of these instruments.

xxvi.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.

21

ZOOMCAR HOLDINGS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL
STATEMENTS (UNAUDITED)

2.Summary
of Significant Accounting Policies (Continued)

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.

xxvii.Taxes

Income
taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences
attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective
tax bases and operating loss and tax credit carry forwards. Deferred tax assets and liabilities are measured using enacted tax rates
expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect
on deferred tax assets and liabilities of a change in tax rates is recognized in income