How would you approach the financial data? Ankvik Analytics claims Rs 36 crore of ARR. Rebuild ARR from last month's billing export and reconcile the gap.

Rebuilt ARR is Rs 30.6 crore, 15% below the Rs 36 crore claim. Multiplying last month's invoices by twelve counts the upfront annual contract twelve times, which is the largest error at Rs 2.64 crore. Annualising one-off implementation adds Rs 1.80 crore, and customers who have given notice add Rs 0.96 crore. Check the rebuilt number against deferred revenue and bank receipts before trusting either.

If a shopkeeper tells you he earns Rs 30,000 a day, you would look at the till roll before believing it, and then at the bank deposits before believing the till roll. In diligence, trust runs from the documents furthest from the founders' hands: signed contracts and bank receipts first, invoices next, management reports after, and the deck last. Here the claim is a deck number built from invoices, so rebuild it from the invoice lines and then test it against the bank and the balance sheet.

ARRAnnual recurring revenue: the yearly value of subscription contracts in force today, counting only revenue that repeats. has one job: to say how much revenue repeats over the next year if nothing else changes. So every line in the export gets one test. Will this rupee recur, and how often? Multiplying a month by twelve passes that test only when every invoice in the month is a monthly subscription that will still be there next year. This export fails on three lines.

Monthly subscriptions from continuing customers recur twelve times: Rs 2.53 crore times 12 is Rs 30.36 crore. The annual contract recurs once: add Rs 0.24 crore. Implementation recurs zero times. The leavers recur zero times beyond next month. Rebuilt ARR is Rs 30.36 crore plus Rs 0.24 crore, Rs 30.6 crore.

Walk from Rs 36 crore down, one adjustment per bar, so the founders can see exactly which line you dispute. The annual contract is the largest error: counted in a month that is then multiplied by twelve, its Rs 24 lakh becomes Rs 2.88 crore, an overstatement of Rs 2.64 crore. Implementation annualised is Rs 1.80 crore that never repeats. The leavers are Rs 0.96 crore of ARR that is already gone in substance. The three together are the whole Rs 5.4 crore gap.

Two cross-checks, each from a document the deck did not touch. First, the balance sheet: an annual contract invoiced upfront should leave about Rs 22 lakh of deferred revenueCash or invoices received for service not yet delivered. It sits as a liability and is released into revenue month by month. after one month. If deferred revenue is much larger, there are more annual contracts than the export shows; if it is zero, the contract may not be what it seems. Second, the bank: monthly subscription receipts should be close to Rs 2.6 crore a month, allowing for timing. A rebuilt ARR is only as good as its tie to cash, so a rupee that never reached the bank does not count.

Then read the gap with judgement, not accusation. Multiplying a month by twelve is a common shortcut among first-time founders, not proof of bad faith. But a Series B priced on Rs 36 crore is priced on a number 15% too high, and the price should move with the number. The question to ask next is how many other annual contracts were billed in earlier months, because a company with lumpy annual billing can show almost any ARR depending on which month it picks.