BACKGROUND AND PRINCIPAL ACTIVITIES
ABS Marine Services Limited ('the Company') is a public limited
company incorporated in India on October 27, 1992 and the
company got listed as Small and Medium sized Enterprise as on
May 21, 2024. The company is engaged in ship owning and ship
management of own ships and of others.
BASIS OF PREPARATION OF FINANCIAL STATEMENTS
The financial statements have been prepared to comply in all
material aspects with the Accounting Standards notified by
the Companies (Accounting Standards) Rules, 2006 referred
to in Section 133 of the Act, read with Rule 7 of the Companies
(Accounts) Rules, 2014 and in accordance with the accounting
principles generally accepted in India ("Indian GAAP). The
Financial Statements have been consistently applied by the
company and are consistent with those used in the previous year.
USE OF ESTIMATES
The preparation of financial statements in conformity with
generally accepted accounting principles requires management
to make estimates and assumptions that affect the reported
amounts of assets and liabilities and disclosure of contingent
liabilities at the date of the financial statements and the
reported amounts of revenues and expenses for the year
presented. Management believes that the estimates used in the
preparation of financial statements are prudent and reasonable.
Actual results could differ from these estimates. Difference
between the actual results and estimates are recognised in
the period in which the results are known / materialised. Any
revision in the accounting estimate is recognised prospectively
in the current and future periods.
CASH FLOW STATEMENT
The company is following the indirect method for reporting
Cash Flows from Operating activities whereby profit before
tax is adjusted for the effects of transactions of a non-cash
nature, any deferrals or accruals of past or future operating
cash receipts and item of income of expenses associated with
investing or financing cash flow.
Cash flows arising from operating, investing and financing
activities are reported on net basis.
Cash and cash equivalents comprise of cash on hand, balances
with bank and deposits with bank. All highly liquid investments
with a remaining maturity of three months or less at the date
of purchase and those that are readily convertible to cash are
considered to be cash equivalents.
REVENUE RECOGNITION
Revenue is primarily derived from Ship Operation and Ship
Management services.
a) Time charter earnings are recognised on accrual basis.
b) Claims receivable on account of Insurance are accounted
for to the extent the Company is reasonably certain of its
ultimate collection.
c) Rental Income is recognised on accrual basis as per the
terms and condition of the agreement.
d) Interest Income from deposits is recognised on a time
proportion basis taking into account, the amount
outstanding and the rate applicable.
e) Dividend income is recognised only when the right to receive
the payment is established.
f) Interest on Income tax refund is recognised on receipt of
refund order.
PROPERTY, PLANT AND EQUIPMENT AND INTANGIBLE
ASSETS
Property Plant and Equipment and Intangible Assets are stated
at cost of acquisition or construction or such other cost as
may be added on account of revaluation, less accumulated
depreciation and impairment. The cost of acquisition or
construction includes any attributable cost that is required to
bring the asset to its working condition for its intended use.
Subsequent expenditures related to an item of fixed asset is
added to its book value only if it increases the future benefits
from the existing asset beyond its previously assessed standard
of performance.
When assets are retired or otherwise disposed off, the cost
of such assets and the related accumulated depreciation and
impairment are removed from the accounts. Any profit or loss
on retirement or other disposal is reflected in the Statement of
Profit and Loss.
Intangible assets are recorded at consideration paid for
acquisition of such assets and are carried at cost less
accumulated amortization and impairment.
DEPRECIATION/AMORTISATION
Depreciation on Fixed Assets is provided at written down value
method in accordance with the useful life prescribed in Schedule
II of the Companies Act, 2013. Where during any financial year,
any addition has been made to any assets or where any asset has
been sold, discarded, demolished or destroyed, the depreciation
on such asset is calculated on a pro rata basis from the date of
such addition or up to the date on which such asset has been
sold, discarded, demolished or destroyed.
Individual low-cost assets (acquired for less than ' 5,000) are
depreciated within a year of acquisition.
Intangible Assets are amortised over a period of 5 years on a
straight-line basis, from the date such asset is put into use.
FOREIGN EXCHANGE FLUCTUATIONS
Transactions in foreign currency are recorded at the rates
prevailing at the date of transaction. Foreign currency monetary
items are reported using the closing rates, i.e. exchange rate at
the Balance Sheet date. Any income or expense on account of
exchange difference either on translation or on settlement, are
recognised as income or expenses in the period in which they
arise. Exchange differences arising on reporting of long-term
foreign currency monetary items at rates different from those
at which they were initially recorded during the period relate to
the acquisition of a depreciable capital asset, has been added to
the cost of the asset and shall be depreciated over the balance
useful life of the asset.
Non-monetary items which are carried in terms of historical
cost denominated in a foreign currency are reported using the
exchange rate at the date of transaction.
INVESTMENTS
Long term investments are stated at cost. Diminution in the value
of investments other than temporary in nature is provided for.
Current Investments are stated at cost or fair value, whichever
is lower.
Cost of overseas investments comprises the Indian Rupee value
of the consideration paid for the investments, translated at the
exchange rate prevalent at the date of investment.
EMPLOYEE BENEFITS
Short term employee benefits:
Employee benefits such as salaries, wages and bonus, etc.,
are recognised as expense at the undiscounted amount in the
Statement of Profit and Loss.
Post-Employment Benefits:
a) Defined Contribution Plan
The company deposits the contributions for provident funds
to the Seaman's Provident Fund and these contributions
are recognised in the Statement of Profit and Loss in the
financial year to which they relate.
b) Defined Benefit Plan
Contributions under gratuity schemes are made to Insurance
Corporation of India (LIC) and SBI Life in accordance with
the terms of policy taken under their group gratuity scheme.
Other Long-term Benefits:
Long term benefits are recognised as an expense in the
Statement of Profit and Loss for the year in which the employee
has rendered the service. The expenses are recognised at
the present value of the amounts payable determined using
actuarial valuation.
Any termination benefits are recognised as expenses
immediately on the basis of actual expenses.
Actuarial gains or losses are recognised immediately in the
Statement of Profit and Loss as income/expense.
BORROWING COST
Interest and other borrowing costs that are directly attributable
to the acquisition, construction or production of a qualifying
asset are capitalized as part of the cost of that asset up to the
date on which the asset is ready for its intended use. A qualifying
asset is one that necessarily takes a substantial period, i.e. more
than twelve months, to get ready for its intended use. Other
interest and borrowing cost are debited to the Statement of
Profit and Loss.
SEGMENT REPORTING
The company is engaged only in shipping business and there are
no separate reportable segments.
LEASES
Lease arrangements where, the risks and rewards incidental to
the ownership of an asset substantially vests with the company
are recognised as Finance Lease and are capitalized at the fair
value of the asset or the present value of the minimum lease
payment at the inception of the lease, whichever is lower.
Lease payments under Operating Leases are expensed in
the Statement of Profit and Loss on a straight-line basis with
reference to lease terms and other consideration
EARNINGS PER SHARE
Basic earnings per share are calculated by dividing the net profit
or loss for the period attributable to equity shareholders by the
weighted average number of equity shares outstanding during
the period.
TAXES ON INCOME
Income tax expense comprises Current Tax and Deferred Tax
charge or credit. Provision for current tax is measured at the
amount expected to be paid to the tax authorities in accordance
with the Income Tax Act, 1961 for the relevant assessment year.
Deferred Tax Adjustments comprising of deferred tax asset and
deferred tax liability is calculated by applying tax rate and laws
that have been enacted or substantively enacted at the Balance
Sheet date. Deferred tax assets arising on account of brought
forward losses and unabsorbed depreciation under tax laws, are
recognized, only if there is a virtual certainty of its realization,
supported by convincing evidence. Deferred tax assets on
account of other timing differences are recognized only to the
extent there is a reasonable certainty of its realization. At each
Balance Sheet date, the carrying amounts of deferred tax assets
are reviewed to reassure realization.
IMPAIRMENT OF ASSETS
The company assesses at each balance sheet date where
there is any indication that an asset maybe impaired. If any
such indication exists, the company estimates the recoverable
amount of the asset. If the recoverable amount of the asset
or the recoverable amount of the cash generating unit to
which the asset belongs, is less than its carrying amount, the
carrying amount is reduced to its recoverable amount and the
reduction is treated as an impairment loss and it is recognised
in the Statement of Profit and Loss. If at the Balance Sheet date
there is an indication that a previously assessed impairment
loss no longer exists, the recoverable amount is reassessed
and the asset is reflected at the recoverable amount subject
to a maximum of depreciated historical cost and is accordingly
reversed in the profit and loss account.
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