1) Company Overview
Adhata Global Limited (formerly MV Cotspln Limited ) Is a public limited company listed with the Bombay Stock Exchange and Is
primarily engaged In the business of trading In Timber.
2) Basis Of Preparation
(I) Compliance with Ind AS:
The financial statements comply in all material aspects with Indian Accounting Standards (“Ind AS”) notified under Section 133 of the
Companies Act, 2013 (“the Act”), and relevant rules issued thereunder and relevant provisions of the Act. In accordance with proviso to
the Rule 4A of the Companies (Accounts) Rules, 2014, the terms used in these financial statements are in accordance with the
definitions and other requirements specified in the applicable Accounting standards.
(ii)The Ind AS Financial Statements have been prepared on a going concern basis using historical cost convention and on an accrual
method of accounting, except for certain financial assets and liabilities as specified have been measured at actuarial valuation as
required by relevant Ind AS.
3) Basis for Classification of Assets & Liabilities:
All the assets and liabilities have been classified as current or non current as per the Company’s normal operating cycle and other
criteria set out in Schedule III to the Companies Act, 2013. Based on the nature of products and the time between the acquisition of
assets or processing and their realization in cash and cash equivalent, the Company has ascertained its operating cycle to be 12
months for the purpose of current - non current classification of assets and liabilities.
4) Use Of Judgements. Estimates & Assumptions
While preparing standalone financial statements in conformity with Ind AS, the management makes certain estimates and assumptions
that require subjective and complex judgments. These judgments affect the application of accounting policies and the reported amount
of assets, liabilities, income and expenses, disclosure of contingent liabilities at the statement of financial position date and the reported
amount of income and expenses for the reporting period. Financial reporting results rely on our estimate of the effect of certain matters
that are inherently uncertain. Future events rarely develop exactly as forecast and the best estimates require adjustments, as actual
results may differ from these estimates under different assumptions or conditions. The management continually evaluate these
estimates and assumptions based on the most recently available information.
Revisions to accounting estimates are recognized in the period in which the estimates are revised and in any future periods affected. In
particular, information about significant areas of estimation uncertainty and critical judgments in applying accounting policies that have
the most significant effect on the amounts recognized in the standalone financial statements are as below:
Key sources of estimation uncertainty
(i) Financial instruments;
The Financial Instruments are measured as financial assets in terms of Ind AS 109. The carrying amounts of trade receivables, trade
payables, current loans, capital creditors and cash and cash equivalents, other financial liabilities are considered to be the same as their
fair values, due to their short-term nature.The fair values of non-current borrowings and non current Loans are same as their amortised
cost since the borrowings are interest bearing at the prevalent market rate.
(ii) Valuation of inventories;
Stock are valued on First In First Out (FIFO) basis and are stated at lower of cost or net realisable value. Closing Stock includes
Custom Duty and other cost incurred in bringing the inventories to their present location and conditions.
(iii) Property Plant and Equipment and Intangible Assets;
Management assesses the remaining usefull lives and residual value of property, plant and equipment. Management believes that the
assigned useful lives and residual values are reasonable.
5) Cash and Cash Equivalents
For the purpose of Cash Flow Statement, cash and cash equivalents includes cash on hand, deposits held at call with banks or financial
institutions, other short-term, highly liquid investments with original maturities of three months or less that are readily convertible to
known amounts of cash and which are subject to an insignificant risk of changes in value, and bank overdrafts. Bank overdrafts are
shown within borrowings in current liabilities in the balance sheet.
6) Financial Instruments
Initial Recognition and Measurement - Financial Assets and Financial Liabilities
Financial assets and financial liabilities are initially measured at fair value. Transaction costs that are directly attributable to the
acquisition or issue of financial assets and financial liabilities (other than financial assets and financial liabilities at fair value through
profit or loss and ancillary costs related to borrowings) are added to or deducted from the fair value of the financial assets or financial
liabilities, as appropriate, on initial recognition. Transaction costs directly attributable to the acquisition of financial assets or financial
liabilities at fair value through profit or loss are recognised immediately in the acquisition of financial assets or financial liabilities at fair
value through profit or loss are recognised immediately in the Statement of Profit and Loss.
Classification and Subsequent Measurement: Financial Assets
The Company classifies financial assets as subsequently measured at amortised cost, fair value through other comprehensive income
(“FVTOCI”) or fair value through profit or loss (“FVTPL”) on the basis of following:
- the entity’s business model for managing the financial assets and
the contractual cash flow characteristics of the financial asset.
Amortised Cost:
A financial asset is classified and measured at amortised cost if both of the following conditions are met:
- the financial asset is held within a business model whose objective is to hold financial assets in order 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.
FVTOCI:
A financial asset is classified and measured at FVTOCI if both of the following conditions are met:
- the financial asset is held within a business model whose objective is achieved by both collecting contractual cash flows and selling
financial assets 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.
FVTPL:
A financial asset is classified and measured at FVTPL unless it is measured at amortised cost or at FVTOCI.
All recognised financial assets are subsequently measured in their entirety at either amortised cost or fair value, depending on the
classification of the financial assets.
Classification and Subsequent measurement: Financial Liabilities
The Company’s financial liabilities include trade and other payables, loans and borrowings including bank overdrafts, financial guarantee
contracts and derivative financial instruments.
Financial Liabilities at FVTPL:
Financial liabilities are classified as at FVTPL when the financial liability is held for trading or are designated upon initial recognition as
FVTPL.
Gains or losses on financial liabilities held for trading are recognised in the Statement of Profit and Loss.
Other Financial Liabilities:
Other financial liabilities (including borrowings and trade and other payables) are subsequently measured at amortised cost using the
effective interest method.
The effective interest method is a method of calculating the amortised cost of a financial liability and of allocating interest expense over
the relevant period. The effective interest rate is the rate that exactly discounts estimated future cash payments (including all fees and
points paid or received that form an integral part of the effective interest rate, transaction costs and other premiums or discounts)
through the expected life of the financial liability, or (where appropriate) a shorter period, to the net carrying amount on initial
recognition.
Initial Recognition: The initial cost of property plant and equipment comprises of purchase price, including non-refundable taxes, import
duty, costs directly attributable of bringing the asset to a working condition and location for its intended use. It also included the initial
estimate of costs of dismantling and removing the item and restoring the site on which it was located.
Subsequent expenses and Recognition: Expenditure incurred after the property, plant and equipment have been put to use such as
repair and maintenance are normally charged to the Statement of Profit and Loss in the period in which such costs are incurred.Major
expenditure and overhaul expenditure is capitalised if other recognition criteria is fulfilled. Subsequently Proprty, Plant and Equipment
are carried at costs less accumulated depreciation and accumulated impairment losses if any.
Depreciation: 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 and is recognised in the statement of profit and loss. The estimated useful lives of
items of property, plant and equipment for the current and comparative periods are as follows
8) Investment Property
Initial Recognition: An investment property shall be measured initially at its cost. Transaction costs shall be included in the initial
measurement.The cost of a purchased investment property comprises its purchase price and any directly attributable expenditure.
Directly attributable expenditure includes, for example, professional fees for legal services, property transfer taxes and other transaction
costs.
The Company recognised its Investment property initially at its cost.
Subsequent expenses and Recognition: Ind AS 40 permits entities to choose between (a) Fair Value Model, and (b) Cost Model
After Initial recognition, an entity is required to measure all of its investment property in accordance with Ind AS 16's requirement for
cost model, other than those that meet the criteria to be classified as held for sale or included in a disposal group that is classified as
held for sale in accordance with Ind As 105, Non- Cuurent Assets held for sale and discontinued operations.
Entities are required to measure the fair value of Investment Property, for the purpose of disclosure even though they are required to
follow the cost model. An entity is encouraged, but not required, to measure the fair value of Investment Property on the basis of the
valuation by an independent valuer who holds a recognised and relevant professional qualification and has recent experience in the
location and category of the Investment Property being valued.
9) Foreign Currency Transaction
The financial statements are presented in Indian Rupees, which is the Company's functional and presentation currency. Transactions
denominated in foreign currency are normally recorded at the exchange rate prevailing at the time of the transaction.Monetary items
denominated in foreign currency at the year end and not covered by forward contracts are translated at the year end rates.
101 Employee retirement benefits
Short term benefits
Short term employee benefits such as Salary , Wages , Bonus , Annual leave and sick leave are recognised as an expense on accrual
basis.
Post employment benefits
Post-employment benefits are classified as either defined contribution plans or defined benefit plans.
Defined Contribution plans :
Under a defined contribution plan, the Company’s only obligation is to pay a fixed amount with no obligation to pay further contributions
if the fund does not hold sufficient assets to pay all employee benefits. The related actuarial and investment risks fall on the employee.
The expenditure for defined contribution plans is recognised as expense during the period when the employee provides service.
Contribution to Provident Fund is covered under Defined Contribution Plans.
Defined Benefit plans:
Under Defined Benefit plan, it is the company's obligation to provide agreed benefits to the employees. The related actuarial and
investment risks fall on the Company. The present value of the defined benefit obligations is calculated using the projected unit credit
method. Contribution to Gratuity is covered under Defined Benefits Plans
Other long term employee benefits:
All employee benefits other than short term employee benefits ,post employment benefits and termination benefits and are not expected
to be settled wholly before twelve months after the end of the annual reporting period in which the employees render the related service.
Long term paid absences is covered under Long term employee benefits
Termination benefits:
Benefits provided in exchange for the termination of an employee's employment
111 Revenue Recognition - Sale of goods
Revenue from the sale of goods is recognised when significant risks and rewards of ownership of the goods have passed to the buyer.
Revenue from sale of goods is measured at the fair value of consideration received or receivable, net of returns and allowances, trade
discounts and volume rebates.
121 Other Income
a) Interest : Interest income is accrued in a time basis, by reference to the principal outstanding and at the effective interest rate
applicable, which is the rate that exactly discounts estimated future cash receipts through the expected life of the financial asset to that
assets net carrying amount on initial recognition.
b) Other Income: Other income is recognised when no significant uncertainity as to determination or realisations exists.
131 Earnings per share
Basic earnings per share is computed using the net profit fot the year attributable to the shareholders and weighted average number of
shares outstanding during the year.
Diluted earnings per share is computed using the net profit for the year attributable to the shareholders and weighted average number
of equity and potential equity shares outstanding during the year, except where the results would be anti-dilutive.
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