Company: ZCARW
Filing Date: 2025-06-30
Form Type: 10-K
Source: 0001213900-25-059675
Chunk: 1665

Company: Zoomcar Holdings, Inc.
Filing Date: 2025-06-30
Form: 10-K
Item: Item 5
Chunk 1665
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 net basis based on factors
given under ASC 606 whether or not it is the principal (gross) or the agent (net) in the transaction and concluded that it is acting in
an agent capacity, and revenue is presented net reflecting the facilitation fees received from the Marketplace service. The customer simultaneously
receives and consumes the benefits provided by the entity’s performance as the entity performs. Revenue is recognized ratably over
the trip period on straight line basis using the output method as its performance obligation is satisfied over time.

The Company offers various incentive programs to hosts. The incentives
are recorded in accordance with ASC 606- 10-32-25 and ASC 606-10-32-27 as a reduction to revenue and in cases where the amount of incentive
paid to the Host are above the facilitation fees earned from that Host on cumulative basis, the excess of the revenue amount is recorded
as a marketing expense in the Consolidated Statements of Operations. These incentives are offered as part of overall marketing strategy
of the Company and incentivize the hosts to refer the platform.

F-11

ZOOMCAR 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