Company: ZCARW
Filing Date: 2025-08-14
Form Type: 10-Q
Source: 0001213900-25-076590
Chunk: 12

Company: Zoomcar Holdings, Inc.
Filing Date: 2025-08-14
Form: 10-Q
Item: Part I, Item 1
Chunk 12
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 Zoomcar Egypt Car Rental LLC   Egypt   Zoomcar	Netherlands Holding   VIE 

The assets/liabilities consolidated for the VIE are not
material. Refer note 27 for details.

iii.Use of estimates and assumptions

The use of estimates and assumptions
as determined by management is required in the preparation of Condensed Consolidated Financial Statements in conformity with US GAAP.
These estimates are based on management’s evaluation of historical trends and other information available when the Condensed Consolidated
Financial Statements are prepared and may affect the amounts reported and related disclosures. Actual results could differ from those
estimates.

Estimates and underlying assumptions are reviewed on an
ongoing basis.

8

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

The significant estimates, judgments
and assumptions that affect the Condensed Consolidated Financial Statements include, but are not limited to; are:

a.Estimation of defined benefit obligation

b.Fair value measurement of financial instruments

c.Estimation of utilization of loyalty points

d.Leases – assumption to determine the incremental borrowing
rate

e.Valuation allowance on deferred tax assets

f.Estimation of utilization of balances with government authorities

Changes in accounting estimates
are accounted for in the period of change and for prospective periods, if applicable. A change to an accounting estimate is recorded based
on events, facts, or circumstances that occurred during the period in which the estimate was changed.

iv.Currency translation

The
Condensed Consolidated Financial Statements are presented in US Dollars (“$”) which is the reporting currency of the
Company.

Monetary assets and liabilities,
and transactions denominated in currencies other than the functional currency are remeasured at the exchange rate on the Balance Sheet
date and non- monetary assets and liabilities are measured at historical exchange rates. The gains and losses resulting from remeasurement
are recorded as foreign exchange gains (losses), within other income (expense), in the Condensed Consolidated Statement of Operations.

The functional currency of the
Company’s foreign subsidiaries is either the local currency or U.S. dollar depending on the nature of the subsidiaries’ activities.
The Company determines the functional currency for each of its foreign subsidiaries by reviewing their operations and currencies used
in their primary economic environments.

Assets and liabilities of the
subsidiaries with functional currency other than U.S. Dollar are translated into U.S. Dollar at the rate of exchange existing at the Balance
Sheet date. Retained earnings and other equity