Company: ZCARW
Filing Date: 2025-06-30
Form Type: 10-K
Source: 0001213900-25-059675
Chunk: 173

Company: Zoomcar Holdings, Inc.
Filing Date: 2025-06-30
Form: 10-K
Item: Item 1
Chunk 173
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OOMCAR HOLDINGS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

2.Summary of Significant Accounting Policies (Continued)

Loyalty program

The Company offers loyalty
program, Z-Points, wherein customers are eligible to earn loyalty points that are redeemable for payment towards facilitation fees.
Under ASC 606, each transaction that generates loyalty points results in the deferral of revenue equivalent to the retail value at
the date the points are earned. The associated revenue is recognized when the customer redeems the loyalty points. The retail value
of points is estimated based on the current retail value measured as of the date the loyalty points are earned, less an estimated
amount representing loyalty points that are not expected to be redeemed (“breakage”). Breakage is reviewed on an annual
basis and includes significant assumptions such as historical breakage trends, internal Company forecasts and extended redemption
period, if any. As at March 31, 2025 and March 31, 2024, the Company’s deferred revenue balance amounted to $21,365 and
$96,710 respectively and is included in Contract liabilities in the Consolidated Balance Sheets.

Contract liabilities

Contract liabilities primarily consist
of obligations to customers for advance received against bookings, revenue-share payable to customers for vehicles listed by them on Company’s
portal for short-term rentals and related to Company’s points-based loyalty program. As per ASC 606- 10-50-14 the Company does not
aggregate amount of transaction price allocated to remaining performance obligations as required under ASC 606-10-50-13, since the company’s
performance obligation is a part of a contract that has an original expected duration of one year or less.

vii.Cash and cash equivalents

Cash and cash equivalents include
cash on hand, bank balances. Cash and cash equivalents are recorded at cost, which approximates fair value.

Cash and cash equivalents include
amounts collected on behalf of but not yet remitted to the Hosts which are included in accrued and other current liabilities in the Consolidated
Financial Statements.

viii.Restricted Cash

The Company is required to place cash
in an indemnification escrow fund with the placement agent for all indemnification liabilities and expenses payable by the Company as
per the placement agent agreement for a period of 3 years from closing of the November 2024 Offering. Such cash is classified as restricted
cash and reported as a component of other non-current assets in the Consolidated Balance Sheets.

ix.Accounts receivable