Company: ZCARW
Filing Date: 2025-06-30
Form Type: 10-K
Source: 0001213900-25-059675
Chunk: 1077

Company: Zoomcar Holdings, Inc.
Filing Date: 2025-06-30
Form: 10-K
Item: Item 2
Chunk 1077
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 interest expense on lease liabilities.
Borrowing costs and interest on leases are recognized in the Consolidated Statements of Operations using the effective interest method.

xix.Employee benefits

Defined benefit plan

Employees in India are entitled to a defined benefit
retirement plan covering eligible employees of the Company. The plan provides for a lump-sum payment to eligible employees, at retirement,
death, and incapacitation or on termination of employment, of an amount based on the respective employees’ salary and tenure of
employment. The Company’s benefit plan is unfunded.

Management makes certain assumptions
relating to discount rates, salary growth, retirement rates, mortality rates and other factors when calculating annual amounts to be recognized.
These assumptions are reviewed annually by management, assisted by the enrolled actuary, and updated as warranted.

F-15

ZOOMCAR HOLDINGS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

2.Summary of Significant Accounting Policies (Continued)

Amortization of a net gain or loss
included in accumulated other comprehensive income shall be included as a component of net pension cost for a year if, as of the beginning
of the year, that net gain or loss exceeds 10 percent of the greater of the projected benefit obligation or the market- related value
of plan assets. If amortization is required, the minimum amortization shall be that excess divided by the average remaining service period
of active employees expected to receive benefits under the plan. Prior service cost is amortized on a straight-line basis from the date
recognized over the average remaining service period of active participants, when applicable.

Compensated absences

The Company’s liability for
compensated absences is determined based on an actuarial valuation using the projected unit credit method and is charged to Consolidated
Statements of Operations in the year in which they accrue.

Defined contribution plan

Eligible employees of the Company
in India participate in a defined contribution fund in accordance with the regulatory requirements in the Indian jurisdiction. Both the
employee and the Company contribute an equal amount to the fund which is equal to a specified percentage of the employee’s salary.

The Company has no further obligation
under defined contribution plans beyond the contributions made under these plans. Contributions are charged to profit or loss and are
included in the Consolidated Statements of Operations in the year and/or period in which they accrue.

xx.Stock-based compensation

The Company accounts for stock-based
compensation expense in accordance with the fair value recognition and measurement provisions of US GAAP,