3 Material accounting policies

3.1 Foreign currency transactions

Transactions in foreign currencies are
translated into the functional currency of the
Company, at the exchange rates at the dates
of the transactions or an average rate, if the
average rate approximates the actual rate at
the date of the transaction. These financial
statements are presented in Indian Rupees
(rounded off to nearest lakhs).

Foreign currency denominated monetary
assets and liabilities are translated into the
relevant functional currency at exchange rates
in effect at the Balance sheet date. The gains
or losses resulting from such transactions are
included in net profit in the Statement of Profit
and Loss.

Non-monetary assets and non-monetary
liabilities denominated in a foreign currency
and measured at fair value are translated
at the exchange rates prevalent at the date
when the fair value was determined. Non¬
monetary assets and non-monetary liabilities
denominated in a foreign currency and
measured at historical cost are translated at
the exchange rates prevalent at the date of
transaction.

Transaction gains or losses realized upon
settlement of foreign currency translations are
included in determining net profit for the period
in which the transaction is settled. Revenue,
expense and cash-flow items denominated
in foreign currencies are translated into the
relevant functional currencies using the
exchange rate in effect on the date of the
transaction.

Foreign exchange differences regarded as an
adjustment to borrowing costs are presented in
the Statement of Profit and Loss, within finance
costs. All other foreign exchange gains and
losses are presented in the Statement of Profit
and Loss on a net basis within other gains/
(losses).

3.2 Financial instruments

i. Recognition and initial measurement

Trade receivables are initially recognised
at transactional cost and debt securities
issued are initially recognised when they
are originated. All other financial assets and
financial liabilities are initially recognised
when the Company becomes a party to the
contractual provisions of the instrument.

ii. Classification and subsequent
measurement

Financial assets

Financial assets are not reclassified subsequent
to their initial recognition, except if and in the
period the Company changes its business
model for managing financial assets.

A financial asset is measured at amortised cost
if it meets both of the following conditions and
is not designated as at FVTPL:

- The asset is held within a business model
whose objective is to hold assets to collect
contractual cash flows; and

- The contractual terms of the financial asset
give rise on specified dates to cash flows that
are solely payments of principal and interest
on the principal amount outstanding.

All financial assets not classified as measured
at amortised cost as described above are
measured at FVTPL. This includes all derivative
financial assets. On initial recognition, the

Company may irrevocably designate a financial
asset that otherwise meets the requirements to
be measured at amortised cost as at FVTPL, if
doing so eliminates or significantly reduces an
accounting mismatch that would otherwise
arise.

Financial liabilities: Classification, subsequent
measurement and gains and losses

Financial liabilities are classified as measured
at amortised cost or FVTPL. A financial liability
is classified as at FVTPL if it is classified
as held-for-trading, or it is a derivative or it
is designated as such on initial recognition.
Financial liabilities at FVTPL are measured at
fair value and net gains and losses, including
any interest expense, are recognised in the
Statement of Profit and Loss. Other financial
liabilities are subsequently measured at
amortised cost using the effective interest
method. Interest expense and foreign exchange
gains and losses are recognised in Statement of
profit and loss. Any gain or loss on derecognition
is also recognised in the Statement of profit and
loss.

iii. Derecognition
Financial assets

The Company derecognises a financial
asset when the contractual rights to
the cash flows from the financial asset
expire. The Company has transferred
its rights to receive cash flows from the
asset or has assumed an obligation to

pay the received cash flows in full without
material delay to a third party under a
'pass-through' arrangement; and either (i)
the Company has transferred substantially
all the risks and rewards of the asset, or
(ii) the Company has neither transferred
nor retained substantially all the risks and
rewards of the asset, but has transferred
control of the asset.

I f the Company enters into transactions
whereby it transfers assets recognised on
its balance sheet, but retains either all or
substantially all of the risks and rewards
of the transferred assets, the transferred
assets are not derecognised.

Financial liabilities

The Company derecognises a financial liability
when its contractual obligations are discharged
or cancelled, or expired.

The Company also derecognises a financial
liability when its terms are modified and the
cash flows under the modified terms are
substantially different. In this case, a new
financial liability based on the modified terms is
recognised at fair value. The difference between
the carrying amount of the financial liability
extinguished and the new financial liability with
modified terms is recognised in the Statement
of Profit and Loss.

iv. Offsetting

Financial assets and financial liabilities are
offset and the net amount is presented in
the balance sheet when, and only when,
the Company currently has a legally
enforceable right to set off the amounts
and it intends either to settle them on a net
basis or to realise the asset and settle the
liability simultaneously.

v. Derivative financial instruments

The Company shall use foreign currency
forward contracts to hedge its risks associated
with foreign currency fluctuations relating to
certain firm commitments and highly probable
forecast transactions if any. The Company
does not hold derivative financial instruments
for speculative purposes. Forward contracts if
any are recognised at fair value on the date the
contract is entered into and are subsequently
remeasured at fair value.

3.3 Property, plant and equipment

i. Recognition and measurement

Items of Property, plant and equipment
are measured at cost less accumulated
depreciation and accumulated impairment
losses, if any.

Cost of an item of Property, plant and
equipment comprises its purchase
price, including import duties and non¬
refundable purchase taxes, after deducting
trade discounts and rebates, any directly
attributable cost of bringing the item to its
working condition for its intended use.

If significant parts of an item of property,
plant and equipment have different useful
lives, then they are accounted for as
separate items (major components) of
Property, plant and equipment.

Any gain or loss on disposal of an item
of Property, plant and equipment is
recognised in the Statement of Profit and
Loss.

Advances paid towards the acquisition of
property, plant and equipment outstanding
at each balance sheet date is classified as
capital advances under other non-current
assets and the cost of assets not put to

use before such date are disclosed under
'Capital work-in-progress'.

ii. Subsequent expenditure

Subsequent expenditure is capitalised only
if it is probable that the future economic
benefits associated with the expenditure
will flow to the Company.

Repairs and maintenance costs are
recognized in the Statement of Profit and
Loss when incurred.

iii. Depreciation and amortisation

Depreciation is calculated on cost of
items of Property, plant and equipment
less their estimated residual values over
their estimated useful lives using the
straight-line method, in case of leasehold
improvements, the shorter lease term and
is generally recognised in the Statement of
Profit and Loss.

Depreciation method, useful lives and residual
values are reviewed at each financial year
end and adjusted if appropriate. Based on
technical evaluation and consequent advice,
the management believes that its estimates
of useful lives as given above best represent
the period over which management expects to
use these assets and are different from those
prescribed in Schedule II of the Companies Act,
2013.

Individual Property, Plant and Equipment whose
cost does not exceed INR 5,000/- are fully
depreciated in the year of acquisition.

Depreciation on additions (disposals) is
provided from the month of additions (up to) the
date on which asset is ready for use (disposed
off).

Leasehold improvements are depreciated over
shorter of their useful life or the lease term,
unless the entity expects to use the assets
beyond the lease term.

The asset's residual values and useful lives are
reviewed and adjusted if appropriate, at the end
of the reporting period.

An Asset's carrying amount is written down
immediately to its recoverable amount if the
asset's carrying amount is greater than its
estimated recoverable amount .

The cost and related accumulated depreciation
are eliminated from the financial statements

upon sale or retirement of the asset and the
resultant gains/ losses are recognised in the
Statement of Profit and Loss. Assets to be
disposed off are reported at the lower of the
carrying value or the fair value less cost to sell.

Transition to Ind AS

On transition to Ind AS, the Company has
elected to continue with the carrying value of all
of its property, plant and equipment recognized
as at 1st April, 2016 measured as per the the
previous GAAP and use that carrying value as
the deemed cost of such property, plant and
equipment.

Leased assets

A Lease is classified at the inception date
as a Finance Lease or an Operating Lease .
A Lease that transfers Substantially all the
risks and rewards incidental to ownership to
the Company is classified as Finance Lease.
Fixed assets acquired on finance lease have
been capitalized at lower of present value of
minimum lease payments or fair value. These
assets have been depreciated over the useful
life of the asset as technically ascertained by
the Company.

3.4 Other Intangible assets

i. Recognition and measurement

Other Intangible assets acquired by the
Company are initially measured at cost.
Such intangible assets are subsequently
measured at cost less accumulated
amortisation and any accumulated
impairment losses.

Other Intangible assets in the nature
of digital assets are capitalized as and
when it is completed and ready for
commercialization and amortized over
a period of revenue earning potential as

estimated by the management. Cost of
own / co production of animation products
and not ready for commercialization as at
the year end is carried forward as capital
work in progress in the balance sheet
as at the year end, if the management
is convinced of the commercial viability
of the same. Development expenses of
animation products that are not considered
to be commercially viable are expensed.

Gains or losses arising from derecognition
of Other Intangible assets are measured
as the difference between the net disposal
proceeds and the carrying amount of the
asset and are recognized in the statement
of profit and loss when the asset is
derecognized.

ii. Subsequent expenditure

Subsequent expenditure is capitalised only
when it increases the future economic
benefits embodied in the specific asset
to which it relates. All other expenditure is
recognised in the Statement of Profit and
Loss as incurred.

iii. Amortisation

Amortisation is calculated to write off
the cost of Other Intangible assets less
their estimated residual values over their
estimated useful lives using the straight¬
line method, and is included in depreciation
and amortisation in Statement of Profit
and Loss.

Amortisation method, useful lives and
residual values are reviewed at the end
of each financial year and adjusted if
appropriate.

3.5 Intangible assets under development

An intangible asset arising from development
(or from the development phase of an internal
project) is being recognised after evaulation of
the following factors:

(a) The technical feasibility of completing the
intangible asset so that it will be available
for use or sale.

(b) Its intention to complete the intangible
asset and use or sell it.

(c) Its ability to use or sell the intangible asset.

(d) How the intangible asset will generate
probable future economic benefits. Among
other things, the entity can demonstrate
the existence of a market for the output of
the intangible asset or the intangible asset
itself or, if it is to be used internally, the
usefulness of the intangible asset.

(e) The availability of adequate technical,
financial and other resources to complete
the development and to use or sell the
intangible asset.

(f) Its ability to measure reliably the
expenditure attributable to the intangible
asset during its development.

3.6 Capital work- in- Progress

Projects under which assets are not ready
for their intended use and other capital work-
in-progress are carried at cost, comprising
direct cost and attributable interest. Once it
has becomes available for use, their cost is re¬
classified to appropriate caption and subjected
to depreciation.

3.7 Investment Property

Investment Property comprises Building that
are held for long-term lease rental yields and/or
for capital appreciation. Investment properties
are initially recognised at cost including
transaction costs. Subsequently Investment
property comprising Building are carried at
cost less accumulated depreciation.

Depreciation on Building is provided over
the estimated useful lives (refer note 3.3) as
specified in Schedule II to the Companies Act,
2013.

Investment property is de-recognised when
either they have been disposed off or doesn't
meet the criteria of Investment Property
when the Investment Property is permanently
withdrawn from use and no future economic
benefit is expected from its disposal.

The difference between the net disposal
proceeds and the carrying amount of the asset
is recognised in the Statement of Profit and
Loss in the period of de-recognition.

3.8 Inventories

Inventories include components , stock in trade,
stores , spares & Stand by Units.

The Company is maintaining inventory in two
heads i.e. own stock and customer stock.

Inventories of raw material , stock in trade are
measured at the lower of cost and net realisable
value. Costs of inventory is determined using
the weighted average method and cost of
inventories comprise all cost of purchase and
other cost incurred in bringing them to the
present location and condition, net of discounts.

When the stocks are used from the provision
made, then the provision is being reversed.

I nventories of stores and spares are valued at

lower of cost, net of provision for diminution
in the value. Cost is determined on weighted
average cost basis.

Net realisable value is the estimated selling
price in the ordinary course of business, less
the estimated costs of completion and selling
expenses.

The Company has changed the policy of
providing for Inventory as given below from FY
2021-22 with effect from 1st October 2021.

a) Stock-in-Trade: If materials held as stock
for more than 365 days, 50% provision and
more than 730 days, 100% Provision will be
created on the value of the stock.

b) Components and Spares used for Repairs
& maintenance Services: 20% provision
will be created on the value of total holding
at the end of every year.

c) Backup computers / Accessories/ Printers
given at customer locations: These
Assets are considered under Inventory in
a separate category with a 20% Provision
on the value of total holding at the end of
every year.

d) Consumables: Consumables are charged
as and when issued from the stores. In
case of assets given on rent under MPS
Division, Consumables will be charged
off as and when replaced in the Machine
(Against the receipt of the defective item).

e) Principal's stock / FOC materials: Only
quantitative count is maintained and not
forming part of the Inventory .

3.9 Impairment

i. Impairment of financial instruments

Evidence that a financial asset is credit -
impaired includes the following observable

data:

- significant financial difficulty of the
borrower or issuer;

- a breach of contract such as a default;

- the restructuring of a loan or advance by
the Company on terms that the Company
would not consider otherwise;

- it is probable that the counter party
will enter bankruptcy or other financial
reorganisation; or

- t he disappearance of an active market
for a security because of financial
difficulties.

The Company measures loss allowance at
an amount equal to lifetime expected credit
losses, except for the following, which are
measured as 12 month expected credit
losses:

- Bank balances for which credit risk (i.e.
the risk of default occurring over the
expected life of the financial instrument)
has not increased significantly since
initial recognition.

Loss allowance for trade receivables are
always measured at an amount equal to
lifetime expected credit losses. Lifetime
expected credit losses are the expected
credit losses that result from all possible
default events over the expected life of a
financial instrument. 12 month expected
credit losses are the portion of expected
credit losses that result from default
events that are possible within 12 months
after the reporting date (or a shorter period
if the expected life of the instrument
is less than 12 months). In all cases,
the maximum period considered when
estimating expected credit losses is the
maximum contractual period over which
the Company is exposed to credit risk.

When determining whether the credit
risk of a financial asset has increased
significantly since initial recognition and
when estimating expected credit losses,
the Company considers reasonable and
supportable information that is relevant
and available without undue cost or
effort. This includes both quantitative and
qualitative information and analysis, based
on the Company's historical experience
and informed credit assessment and
including forward - looking information.”

The Company assumes that the credit
risk on a financial asset has increased
significantly if it is more than 365 days past
due.

The Company considers a financial asset
to be in default when:

- the borrower is unlikely to pay its credit
obligations to the Company in full,
without recourse by the Company to
actions such as realising security (if any
is held).

- the financial asset is 730 days or more
and due.

Measurement of expected credit losses

Expected credit losses are a
probability-weighted estimate of credit
losses. Credit losses are measured as the
present value of all cash shortfalls (i.e.
the difference between the cash flows
due to the Company in accordance with
the contract and the cash flows that the
Company expects to receive).

Presentation of allowance for expected
credit losses in the Balance Sheet

Loss allowance for financial assets
measured at amortised cost are deducted
from the gross carrying amount of the
assets.

Write-off

The gross carrying amount of a financial
asset is written off (either partially or in
full) to the extent that there is no realistic
prospect of recovery. This is generally
the case when the Company determines
that the debtor does not have assets or
sources of income that could generate
sufficient cash flows to repay the amounts
subject to the write-off. However, financial
assets that are written off could still be
subject to enforcement activities in order
to comply with the Company's procedures
for recovery of amounts due.

ii. Impairment of non-financial assets

The Company's non-financial assets, other
than inventories and deferred tax assets,
are reviewed at each reporting date to
determine whether there is any indication
of impairment. If any such indication
exists, then the asset's recoverable amount
is estimated. For impairment testing,
assets that do not generate independent
cash inflows are grouped together into
cash-generating units (CGUs). Each CGU
represents the smallest group of assets
that generates cash inflows that are largely
independent of the cash inflows of other
assets or CGUs.

The recoverable amount of a CGU (or an
individual asset) is the higher of its value
in use and its fair value less costs to sell.

Value in use is based on the estimated
future cash flows, discounted to their
present value using a pre-tax discount rate
that reflects current market assessments
of the time value of money and the risks
specific to the CGU (or the asset).

The Company's corporate assets do not
generate independent cash inflows. To
determine impairment of a corporate
asset, recoverable amount is determined
for the CGUs to which the corporate asset
belongs.

An impairment loss is recognised if the
carrying amount of an asset or CGU
exceeds its estimated recoverable amount.
Impairment losses are recognised in the
statement of profit and loss. Impairment
loss recognised in respect of a CGU is
allocated first to reduce the carrying
amount of any goodwill allocated to the
CGU, and then to reduce the carrying
amounts of the other assets of the CGU (or
group of CGUs) on a pro rata basis.

3.10 Employee benefits

Expenses and liabilities in respect of employee

benefits are recorded in accordance with Ind

AS 19- Employee Benefits.

i. Short-term employee benefits

Short-term employee benefit obligations
are measured on an undiscounted basis
and are expensed as the related service
is provided. A liability is recognised for the
amount expected to be paid e.g., under
short-term bonus, if the Company has a
present legal or constructive obligation to
pay this amount as a result of past service
provided by the employee, and the amount
of obligation can be estimated reliably.

ii. Share-based payment transactions

The grant date fair value of equity settled
share-based payment awards granted to
employees is recognised as an employee
expense, with a corresponding increase in
equity, over the period that the employees
unconditionally become entitled to the
awards. The amount recognised as
expense is based on the estimate of the
number of awards for which the related
service and non-market vesting conditions
are expected to be met, such that the
amount ultimately recognised as an
expense is based on the number of awards
that do meet the related service and non¬
market vesting conditions at the vesting
date.

iii. Defined contribution plans

A defined contribution plan is a post¬
employment benefit plan under which
an entity pays fixed contributions into
a separate entity and will have no
legal or constructive obligation to pay
further amounts. The Company makes
specified monthly contributions towards
Government administered provident fund
scheme and Employees State Insurance
Scheme. Obligations for contributions to
defined contribution plans are recognised
as an employee benefit expense in profit or
loss in the periods during which the related
services are rendered by employees.

iv. Defined benefit plans

A defined benefit plan is a post¬
employment benefit plan other than a
defined contribution plan. The Company's
net obligation in respect of defined benefit
plans is calculated separately for each plan
by estimating the amount of future benefit

that employees have earned in the current
and prior periods.

The Company's gratuity plan is partly
funded, defined benefit obligation is
performed annually by a qualified actuary
using the projected unit credit method
at each balance sheet date. The defined
benefit obligation is determined as the
present value of the estimated future
cash flows expected to be made by the
Company in respect of services rendered
by its employees up to the reporting date.

Remeasurements of the net defined benefit
liability, which comprise actuarial gains
and losses are recognised in OCI. The
Company determines the interest expense
on the defined benefit liability for the
period by applying the discount rate used
to measure the defined benefit obligation
at the beginning of the annual period to
the then defined benefit liability. Interest
expense and other expenses related to
defined benefit plans are recognised in
profit or loss under finance costs and
employee benefit expenses respectively.

When the benefits of a plan are changed
or when a plan is curtailed, the resulting
change in benefit that relates to past
service ('past service cost' or 'past service
gain') or the gain or loss on curtailment is
recognised immediately in profit or loss.
The Company recognises gains and losses
on the settlement of a defined benefit plan
when the settlement occurs.

v. Other long-term employee benefits

The Company's net obligation in respect
of long-term employee benefits other than
post-employment benefits is the amount of
future benefit that employees have earned

in return for their service in the current and
prior periods; that benefit is discounted to
determine its present value, and the fair
value of any related assets is deducted.
The obligation is measured on the basis of
an annual independent actuarial valuation
using the projected unit credit method.
Remeasurements gains or losses are
recognised in the statement of profit and
loss in the period in which they arise.

3.H Revenue recognition

Revenue is recognised to the extent that it is
probable that the economic benefits will flow to
the Company and the revenue can be reliably
measured, regardless of when the payment is
being made. Revenue is measured at the fair
value of the consideration received or receivable,
taking into account contractually defined terms
of payment and excluding taxes and duties
collected on behalf of the government. The
Company has concluded that it is the principal
in all of its revenue arrangements since it is the
primary obligor in all the revenue arrangements
as it has pricing latitude and is also exposed to
inventory and credit risks.

The following specific recognition criteria
must also be met before revenue is recognised:

IT Services

The Company earns revenue primarily from
providing warranty and post warranty services,
annual maintenance contract services, on-site
support services and other related services.
The Company has applied Ind AS 115 which
establishes a comprehensive framework for
determining whether, how much and when
revenue is to be recognised.

Revenue is recognised upon transfer of control
of promised services to customers in an

amount that reflects the consideration which
the Company expects to receive in exchange
for those services.

- Revenue from warranty services is recognised
on output basis, measured by number of calls
processed.

- Revenue from annual maintenance service
where the Company is standing ready to
provide services is recognised based on time
elapsed mode and revenue is straight lined
over the period of performance.

- Revenue from others comprises of sale of
spares and outsourced manpower supply.
The Company recognises the revenue on sale
of spares at the point in time when control is
transferred to the customer. Revenue in case
of outsourced manpower is based on output
basis, measured by efforts expended (hours).

- Revenue from scrap sales is recognised at the
point in time when control is transferred to the
customer.

Contract assets are recognised when there
is excess of revenue earned over billings on
contracts. Contract assets are classified as
unbilled receivables (only act of invoicing is
pending) when there is unconditional right
to receive cash, and only passage of time is
required, as per contractual terms.

Unearned and deferred revenue ("contract
liability”) is recognised when there is billings in
excess of revenues.

I n accordance with Ind AS 37, the Company
recognises an onerous contract provision
when the unavoidable costs of meeting the
obligations under a contract exceed the
economic benefits to be received.

Disaggregation of revenue

The Company disaggregates revenue from
contracts with customers by the geographic
location of the customers. The Company
believes that this disaggregation best depicts
how the nature, amount, timing and uncertainty
of our revenues and cash flows are affected by
industry, market and other economic factors.

Performance obligations and revenue
recognition policies

The following details provides information
about the nature and timing of the satisfaction
of performance obligations in contracts with
customers, including significant payment
terms, and the related revenue recognition
policies.

Revenue recognition under Ind AS 115

a. Sale of Goods

Sale is recognised upon transfer of
control of promised delivery of goods to
the customers, being the point of time
when the product / software is delivered
and acknowledged by the customer in an
amount that reflects the considerations
expected to receive in exchange for those
products . Revenue is measured based
on the transaction price, which is the
consideration as specified in the contract
with the customer. Revenue also excludes
taxes collected from customers.

b. Sale of Services

Revenue is recognisd upon transfer
of control of promised services to the
customers in an amount that reflects
the considerations expected to receive
in exchange for those products or
services. Revenue is measured based
on the transaction price, which is the

consideration as specified in the contract
with the customer. Revenue also excludes
taxes collected from customers.

Under fixed price maintenance and support
services, the performance obligations
relating to the service are satisfied over
a period of time and the revenue is
recognised on a straight line basis over
the period of contract, net of expected
liquidated damages or deductions.

1) Rental Income

Revenue from renting out of movable
and immovable properties are
recognised on an accrual basis.

2) Interest Income

I nterest Income reported on accrual
basis using the effective interest
method and is included under the
head " Other Income” in the statement
of Profit and loss .

3) Unbilled Revenue

The Company has contracts with
customers ranging from 1 year to
5 years and the billing is done as
per billing cycle based on contract
terms. Revenue is recognised by
the Company on annuity basis. So
wherever bills have not been raised
revenue is recognised based on the
basis of service provided. However,
these estimates are reviewed regularly
and figures are revised based on
subsequent billing .

4) Deferred Income

Billing is made as per billing cycles
agreed with the customers. Wherever
billing is made as per contract and the

period of such billing has not expired,
such revenue for the unexpired
period of contract as on the date of
recognition is treated as deferred
revenue.

3.12 Leases

i) Company as a lessee:

The Company accounts for each lease
component within the contract as a lease
separately from non-lease components of the
contract and allocates the consideration in the
contract to each lease component on the basis
of the relative stand-alone price of the lease
component and the aggregate stand-alone
price of the non-lease components.

The Company recognises a right-of-use
asset and a lease liability at the lease
commencement date. The right-of-use asset
is initially measured at cost, which comprises
the initial amount of the lease liability adjusted
for any lease payments made at or before the
commencement date, plus any initial direct
costs incurred and an estimate of costs to
dismantle and remove the underlying asset or
to restore the underlying asset or the site on
which it is located, less any lease incentives
received.

The right-of-use asset is subsequently
depreciated using the straight-line method from
the commencement date to the end of the lease
term, unless the lease transfers ownership of
the underlying asset to the Company by the end
of the lease term or the cost of the right-of-use
asset reflects that the Company will exercise a
purchase option. In that case the right-of-use
asset will be depreciated over the useful life of
the underlying asset, which is determined on
the same basis as those of property, plant and
equipment. In addition, the right-of-use asset is

periodically reduced by impairment losses, if
any, and adjusted for certain remeasurements
of the lease liability.

The lease liability is initially measured at the
present value of the lease payments that are not
paid at the commencement date, discounted
using the Company's incremental borrowing
rate. The Company determines its incremental
borrowing rate by obtaining interest rates from
various external financing sources that reflects
the terms of the lease and type of the asset
leased.

The lease payments: included in the
measurements of the lease liability comprise
the following

- fixed payments, including in-substance fixed
payments;

- variable lease payments that depend on an
index or rate, initially measured using the
index or rate as at the commencement date

- amounts expected to be payable under a
residual value guarantee; and

- t he exercise price under a purchase option
that the Company is reasonably certain
to exercise, lease payments in an optional
renewal period if the Company is reasonably
certain to exercise an extension option, and
penalties for early termination of a lease
unless the Company is reasonably certain not
to terminate early.

The lease liability is measured at amortised
cost using the effective interest method.
It is remeasured when there is a change in
future lease payments arising from a change
in an index or rate, if there is a change in the
Company's estimate of the amount expected
to be payable under a residual value guarantee,
if the Company changes its assessment of

whether it will exercise a purchase, extension
or termination option or if there is a revised in¬
substance fixed lease payment.

When the lease liability is remeasured in this
way, a corresponding adjustment is made to
the carrying amount of the right-of-use asset,
or is recorded in Statement of Profit and loss
if the carrying amount of the right-of-use
asset has been reduced to zero. The Company
presents right-of-use assets and lease liabilities
separately on the face of the balance sheet.

ii) Short-term leases and low value assets:

The Company has elected not to apply the
requirements of Ind AS 116 Leases to short¬
term leases of all assets that have a lease
term of 12 months or less and leases for which
the underlying asset is of low value. The lease
payments associated with these leases are
recognized as an expense on a straight-line
basis over the lease term .

iii) Operating leases:

Leases, where the lessor effectively retains
substantially all the risks and rewards incidental
to ownership of the leased item are classified
as operating leases. Payments under operating
leases are recognized in the Statement of
Profit and Loss on a straight line basis over
the term of the lease unless such payments
are structured to increase in line with expected
general inflation to compensate for the lessor
inflationary cost increase.

3.13 Recognition of dividend income, interest
income or expense

Dividend income is recognised in the statement
of profit and loss on the date on which
the Company's right to receive payment is
established.

related to income taxes. It is measured
using tax rates (and tax laws) enacted
or substantively enacted by the Balance
sheet date.

Current tax assets and current tax
liabilities are offset only if there is a legally
enforceable right to set off the recognised
amounts, and it is intended to realise the
asset and settle the liability on a net basis
or simultaneously.

ii. Deferred tax

Deferred tax is recognised in respect
of temporary differences between the
carrying amounts of assets and liabilities
for financial reporting purposes and the
corresponding amounts used for taxation
purposes. Deferred tax is also recognised
in respect of carried forward tax losses
and tax credits, if any. Deferred tax is not
recognised for:

- temporary differences arising on the
initial recognition of assets or liabilities
in a transaction that is not a business
combination and that affects neither
accounting nor taxable profit or loss at
the time of the transaction;

- temporary differences related to
investments in subsidiaries, associates
and joint arrangements to the extent
that the Company is able to control the
timing of the reversal of the temporary
differences and it is probable that they
will not reverse in the foreseeable future.

- taxable temporary differences arising on
the initial recognition of goodwill.

Unrecognised deferred tax assets are re¬
assessed at each reporting date and are

recognised to the extent that it is probable
that future taxable profits will be available
against which they can be used. Deferred
tax assets are reviewed at each reporting
date and are recognised/ reduced to
the extent that it is probable/ no longer
probable respectively that the related tax
benefit will be realised.

Deferred tax is measured at the tax rates
that are expected to apply to the period
when the asset is realised or the liability is
settled, based on the laws that have been
enacted or substantively enacted by the
reporting date.

The measurement of deferred tax reflects
the tax consequences that would follow
from the manner in which the Company
expects, at the reporting date, to recover
or settle the carrying amount of its assets
and liabilities.

Deferred tax assets and liabilities are offset
if there is a legally enforceable right to offset
current tax liabilities and assets, and they
relate to income taxes levied by the same
tax authority on the same taxable entity, or
on different tax entities, but they intend to
settle current tax liabilities and assets on a
net basis or their tax assets and liabilities
will be realised simultaneously.

Deferred tax assets include Minimum
Alternative Tax (MAT) paid in accordance
with the tax laws in India, to the extent it
would be available for set off against future
current income tax liability. Accordingly,
MAT is recognised as deferred tax asset in
the balance sheet when the asset can be
measured reliably and it is probable that
the future economic benefit associated
with the asset will be realised.

3.15 Earnings per share

Basic Earnings per share is computed by
dividing profit or loss attributable to equity
shareholders of the Company by the Weighted
average number of equity shares outstanding
during the year.

Diluted EPS amounts are calculated by dividing
the profit attributable to equity holders of the
Company (after adjusting for interest on the
convertible preference shares, if any) by the
weighted average number of equity shares
outstanding during the year plus the weighted
average number of equity shares that would be
issued on conversion of all the dilutive potential
equity shares into equity shares. Dilutive
potential equity shares are deemed converted
as of the beginning of the period, unless issued
at a later date. Dilutive potential equity shares
are determined independently for each period
presented.

3.16 Cash and cash equivalents

Cash and cash equivalents comprise of cash
on hand and balance with Bank including
short-term deposits with an original maturity
of three months or less, which are subject to
an insignificant risk of changes in value. Other
Bank deposits which are not in the nature of
cash and cash equivalents with a maturity
period of more than three months are classified
as other Bank balances.

3.17 Cash flows

Cash flows are reported using the indirect
method, whereby profit before tax is adjusted
for the effects of transactions of a non-cash
nature and any deferrals or accruals of past
or future cash receipts or payments. The
cash flows from regular revenue generating,
financing and investing activities of the
Company are segregated. Cash flows in foreign

currencies are accounted at average monthly
exchange rates that approximate the actual
rates of exchange prevailing at the dates of
the transactions. In the cash flow statement,
cash and cash equivalents includes cash in
hand, cheques on hand, balances with banks
in current accounts and other short-term highly
liquid investments with original maturities of 3
months or less, as applicable.

3.18 Borrowing costs

Borrowing costs are interest and other costs
(including exchange differences relating to
foreign currency borrowings to the extent
that they are regarded as an adjustment to
interest costs) incurred in connection with the
borrowing of funds. Borrowing costs directly
attributable to acquisition or construction of
an asset which necessarily take a substantial
period of time to get ready for their intended use
or sale are capitalised as part of the cost of that
asset. Other borrowing costs are recognised
as an expense in the period in which they are
incurred.

3.19 Dividend to share holders

Final dividend distributed to Equity share
holders is recognised in the period in which it
is approved by the members of the Company in
the Annual General Meeting. Final dividend net
of divided distribution tax are recognised in the
Statement of Changes in Equity.

3.20 Business combinations

In accordance with Ind AS 101 provisions
related to first time adoption, the Company has
elected to apply Ind AS accounting for business
combinations prospectively from 1 April 2015.
As such, Indian GAAP balances relating to
business combinations entered into before that
date, have been carried forward.

Business combinations involving entities under
the common control are accounted for using
the pooling of interest method. The assets and
liabilities of the combining entities are reflected
at their carrying amounts. No adjustments are
made to reflect fair values, or recognise any
new assets or liabilities. The only adjustments
that are made are to harmonise accounting
policies.

The identity of the reserves shall be preserved
and shall appear in the financial statements of
the transferee in the same form in which they
appeared in the financial statements of the
transferor. Any consideration in excess of the
net worth of the acquire Company is adjusted
against the reserves of the acquiring Company.

Previous year's figure have been regrouped,
recasted and rearranged wherever necessary,
to suit the current period layout.