Significant Accounting Policies
The significant accounting policies applied by the Company in the preparation of its Financial Statements are
listed below. Such accounting policies have been applied consistently to all the periods presented in these
Financial Statements.
a. Statement of Compliance
The financial statements have been prepared in accordance with the relevant presentation requirements of the
Companies Act, 2013.
b. (1)Basis for Preparation & Presentation
The Financial Statements have been prepared under the historical cost convention on accrual basis with the
exception of certain assets and liabilities carried at fair values. The Assets and Liabilities have been classified
as Current/Non- Current as per the Company's normal operating cycle and other criteria set out in the Act.
Based on the nature of products and the time between the acquisition of assets for processing and their
realisation in Cash and Cash Equivalents, the Company has ascertained its operating cycle as 12 months for
the purpose of Current/Non- Current classification of Assets and Liabilities. The statement of Cash Flows has
been prepared under indirect method.
All amounts disclosed in the Financial Statements and accompanying notes have been rounded off to the
nearest lakhs as per the requirement of Schedule III of the Companies Act, 2013, unless otherwise stated.
(2)Use of Estimates and Critical Accounting Judgements
The preparation of Financial Statements is in conformity with Generally Accepted Accounting Principles
which requires management to make estimates and assumptions. The estimates and the associated
assumptions
are based on historical experience, opinions of experts and other factors that are considered to be relevant.
c. Property, Plant and Equipment-Tangible Assets
Property, Plant and Equipment are stated at cost, net of recoverable taxes, trade discounts and rebates less
accumulated depreciation and impairment losses, if any. Such cost includes purchase price, borrowing cost
and any cost directly attributable to bringing the assets to its working condition for its intended use, net
changes on foreign exchange contracts and adjustments arising from exchange rate variations attributable to
the assets. All other repairs and maintenance are charged to the Statement of Profit and Loss during the
reporting period in which they are incurred. An item of Property, Plant and Equipment is derecognised upon
disposal or when no future economic benefits are expected to arise from continued use of asset.
Depreciation Method and Estimated Useful Life
Depreciation is calculated using the straight-line method on a pro-rata basis from the date on which each asset
is put to use to allocate their cost, net of their residual values, over their estimated useful lives. The estimated
useful lives are those prescribed under Schedule II to the Companies Act, 2013.
d. Intangible Assets and Amortisation
Intangible assets are stated at cost, net of recoverable taxes, trade discounts and rebates less accumulated
amortisation and impairment loss, if any. The cost comprises of purchase price, borrowing costs and any cost
directly attributable to bringing the asset to its working condition for the intended use.
e. Impairment
Tangible and Intangible Assets are tested for impairment whenever events or changes in circumstances
indicate that the carrying amount may not be recoverable. An impairment loss is recognised for the amount
by which the asset's carrying amount exceeds its recoverable amount. The recoverable amount is the higher
of an asset's fair value less costs of disposal and value in use. Non financial assets that suffered an impairment
are reviewed for possible reversal of the impairment at the end of each reporting period.
f. Leases
Company as a lessor:
The Company classifies the leases as either a finance lease or an operating lease depending on whether the
risks and rewards incidental to ownership of an underlying asset are transferred and recognises finance
income over the lease term.
Company as a lessee:
In accordance with Ind AS-116, the Company assesses whether a contract contains a lease ,at inception of a
contract. At the date of commencement of the lease, the Company recognises a "Right Of Use" asset and a
corresponding liability for all lease arrangements in which it is the lessee, except for leases with a term of
twelve months or less (short term leases) and low value leases. For these short term and low value leases, the
Company recognises the lease payments as an operating expense on a straight line basis over the term of the
lease. The right of use assets are amortised using the straight line method from the commencement date over
the shorter of lease term or useful life of right to use asset. The lease payments are discounted using the interest
rate implicit in the lease or if not readily determinable using the incremental borrowing rates. Lease Liabilities
are re measured with a corresponding adjustment to the related right of use asset if the Company changes its
assessment of whether it will exercise an extension or termination option.
g. Financial Instruments
Financial Assets and Financial Liabilities are recognised when the Company becomes a party to the contractual
provisions of the relevant instrument or Financial Liabilities. Purchase and sale of Financial Assets are
recognised using trade date accounting.
Financial Assets
Financial Assets include Trade Receivables, Advances, Security Deposits, Cash and Cash Equivalents etc.
which are classified for measurement at amortised cost. Management determines the classification of an asset
at initial recognition depending on the purpose for which the assets were acquired. The subsequent
measurement of Financial Assets depends on such classification.
Impairment: The Company assesses at each reporting date whether a Financial Asset (or a group of Financial
Assets) are tested for impairment based on available evidence or information. Expected credit losses are
assessed and loss allowances recognised if the credit quality of the Financial Asset has deteriorated
significantly since initial recognition.
Income Recognition: Interest income is recognised in the Statement of Profit and Loss using the effective
interest method.
Financial Liabilities:
Borrowings, Trade Payables and other Financial Liabilities are initially recognised at the value of the respective
contractual obligations. They are subsequently measured at amortised cost using the effective interest method.
For trade and other payables maturing within one year from the Balance Sheet date, the carrying amounts
approximate fair value due to short maturity of these instruments.
De-Recognition:
Financial Liabilities are derecognised when the liability is extinguished, that is, when the contractual
obligation is discharged, cancelled and on expiry.
h. Inventories
Inventories are valued at lower of cost and net realisable value except waste which is valued at estimated
realisable value as certified by the management.
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