SIGNIFICANT ACCOUNTING POLICIES AND NOTES TO STANDALONE FINANCIAL STATEMENTS NOTE -1 CORPORATE INFORMATION
Akanksha Power and Infrastructure Private Limited was incorporated as a Private Limited Company in the State of Maharashtra under the Companies Act, 1956 vide Certificate of Incorporation dated July 01, 2008 bearing Corporate Identification Number
U40104MH2008PTC184149 issued by the Registrar of Companies, Maharashtra. Subsequently, the company was converted into Public Limited Company and the name of the company was changed to Akanksha Power and Infrastructure Limited pursuant to issuance of Fresh Certificate of Incorporation dated 24th April, 2023 from Registrar of Companies, Maharashtra with Corporate Identification Number L40104MH2008PLC184149. The company was listed on NSE Limited under SME segment on January 03, 2024.
The principal activity of the Company includes manufacturing of electrical components, execution of turnkey projects and electrical distribution and management services. The address of the Registered Office of Company is Plot No. 87/4, MIDC, Satpur, Nashik, Maharashtra - 422010, India.
NOTE - 2 SIGNIFICANT ACCOUNTING POLICIES
a. Basis of Preparation
The financial statements of the company have been prepared and presented in accordance with the Generally Accepted Accounting Principles (GAAP). GAAP comprises the Accounting Standards notified u/s S.133 read with S.469 of the Companies Act, 2013. The accounting policies have been framed, keeping in view the fundamental accounting assumptions of Going Concern, Consistency and Accrual, as also basic considerations of Prudence, Substance over form, and Materiality. These have been applied consistently, except where a newly issued accounting standard is initially adopted or a revision in the existing accounting standards require a revision in the accounting policy so far in use. The need for such a revision is evaluated on an ongoing basis.
The Financial Statements have been prepared on a going concern basis, inasmuch as the management neither intends to liquidate the company nor to cease operations. Accordingly, assets, liabilities, income and expenses are recorded on a Going Concern basis.
Based on the nature of products and services, and the time between the acquisition of assets and realization in cash or cash equivalents, the company has ascertained its operating cycle as 12 months for the purposes of current and non-current classification of assets and liabilities
b. Basis of Measurement
The Financial Statements have been prepared on historical cost convention, on accrual basis of accounting, except for Cash Flow Statement.
c. Use of Estimates
The preparation of the financial statements is in conformity with Indian GAAP (Generally Accepted Accounting Principles) which requires the management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent liabilities as on the date of the financial statements. The estimates and assumptions made and applied in preparing the financial statements are based upon management's best knowledge of current events and actions as on the date of financial statements.
However, due to uncertainties attached to the assumptions and estimates made actual results could differ from those estimates. Any revision to accounting estimates is recognized prospectively in current and future periods.
d. Functional and Presentation Currency
The company reports its transactions in Indian Rupees. The financial statements have been "rounded off" to the nearest lacs considering on the basis of "Total Income" criteria.
Based on the total income of the company, the amounts presented in the Financial Statements are uniformly rounded off to the nearest lakhs except for earnings per share and ratios.
Cash and cash equivalent in the balance sheet comprise all cash balances and short-term highly liquid investments that are readily convertible into known amounts of cash and which are subject to an insignificant risk of changes in value. Foreign Currency cash if any, and cash equivalents are measured at fair value.
Cash flows are reported using the indirect method, whereby profit / (loss) before extraordinary items and tax is adjusted for the effects of transactions of noncash nature and any deferrals or accruals of past or future cash receipts or payments. Cash flow statement classifies cash flows during the period from operating, investing and financing activities of the Company.
g. Property Plant and Equipment
Tangible assets are stated at cost, less accumulated depreciation and impairment, if any. Direct costs are capitalized until such assets are ready for use. Capital work in progress comprises the cost of fixed assets that are not yet ready for their intended use at the reporting date.
h. Impairment of Assets
At each balance sheet date, the Company reviews the carrying amount of its fixed assets to determine whether there is any indication that those assets suffered an impairment loss. If any such indication exists, the recoverable amount of the assets is estimated in order to determine the extent of impairment loss. Recoverable amount is the higher of an asset's net selling price and value in use. In assessing value in use, the estimated future cash flows expected from the continuing use of the assets and from its disposal are discounted to their present value using a pre-tax discount rate that reflects the current market assessments of time value of money and the risks specific to the assets.
i. Depreciation
Depreciation has been charged on cost of fixed assets, adopting the following methods / rates:
1. Depreciation is calculated using Straight Line Method (SLM) to allocate their cost, net of their residual values, over their estimated useful lives prescribed in Schedule II of the Companies Act, 2013
2. If the cost of a part of the asset is significant to the total cost of the asset and useful life of that
part is different from the useful life of the remaining asset, useful life of that significant part is determined separately for Depreciation.
3. For other assets acquired / sold during the year pro rata charge has been made from the date of first use or till the date of sale.
j. Capital Work in Progress
Properties under construction are stated at cost less accumulated impairment losses if any, until construction or development is completed, at which time they are reclassified to be accounted for as an item of Property Plant and Equipment. Cost capitalized include cost of land and other directly related development expenditure incurred in developing the asset.
Cost of assets under development and not ready for intended use, as on the reporting date, is shown as capital work in progress. Advances given towards acquisition of factory building and expenses related to this, since the property is not transferred as at the reporting date, the outstanding at each reporting date are disclosed under the head for Capital Assets under WIP
k. Intangible Assets
Intangible assets purchased by the company, and that have finite useful lives, are measured at cost, less accumulated amortization and accumulated impairment losses. Cost includes expenditure that is directly attributable to the acquisition of the intangible asset.
Subsequent expenditure on intangible assets is capitalized only when it increases the future economic benefits embodied in the specific asset to which it relates.
l. Investments
Non-Current/ Long-term Investments are stated at cost. Provision is made for diminution in the value of the investments, if, in the opinion of the management, the same is considered to be other than temporary in nature. On disposal of an investment, the difference between its carrying amount and net disposal proceeds is charged or credited to the Statement of Profit and Loss.
Current investments are carried at lower of cost and fair value determined on an individual basis. On disposal of an investment, the difference between its carrying amount and net disposal proceeds is charged or credited to the Statement of Profit and Loss Transactions in foreign currency are accounted for at exchange rates prevailing on the date of the transaction.
m. Inventories
Inventories are valued at the lower of the cost & estimated net realizable value. Cost of inventories is computed on a FIFO basis. Finished goods & work in progress include costs of conversion & other costs incurred in bringing the inventories to their present location & condition. Proceeds in respect of sale of raw materials /stores are credited to the respective heads. Obsolete, defective & unserviceable stocks are duly provided for.
For inventory items, that are not ordinarily interchangeable and goods or services produced and segregated for specific projects, the cost is assigned by specific identification of their individual costs. In respect of other items, cost is ascertained by adopting First-in-first-out method. Net realisable value is the estimated selling price in the ordinary course of business less the estimated costs of completion and the estimated costs necessary to make the sale
n. Trade and Other Receivables
Trade and other receivables are generally measured at invoice value. An allowance for any shortfall in recovery is established if the collection of a receivable becomes doubtful. The amount of the allowance is the difference between the asset's carrying amount and the estimated future cash flows. The loss allowance as also any subsequent recoveries made is recognized in the Profit and Loss. Bad debts are written off when identified. Under the PPP project, 10% retention money remains outstanding and is receivable from the Special Purpose Vehicle (SPV) upon completion of the warranty period. This amount pertaining to the Odisha Housing and Urban Development Authority (OUDF), is recognized under the 'Debtors' category, as it becomes due post the guarantee period.
o. Revenues and Other Income
a. Revenue from sale of goods is recognised when significant risk and rewards of ownership of the goods have been passed to the buyer and it is reasonable to expect ultimate collection. Sale of goods is recognised net of GST and other taxes.
b. Revenue from sales are accounted on accrual basis except Power Distribution sales which is accounted on the basis of actual collection from consumers.
c. In respect of transactions involving rendering of services, performance is measured either under the completed service contract method or under the proportionate completion method, whichever relates the revenue to the work accomplished. Such performance is regarded as being achieved when no significant uncertainty exists regarding the amount of the consideration that will be derived from rendering the service.
d. Interest income is recognized on accrual basis, adopting a time proportion method, taking
into account the amount outstanding and the rate applicable.
e. Other items of income and expenses are recognised on accrual basis.
f. Income from export entitlement is recognised as on accrual basis.
p. Borrowing Costs
Interest and other costs in connection with the borrowing of the funds to the extent related/attributed to the acquisition/construction of qualifying fixed assets are capitalized as a part of the cost of such asset up to the date when such assets are ready for its intended use and other borrowing costs are charged to statement of Profit & Loss.
q. Foreign Currency Transactions
Transactions denominated in foreign currencies are recorded at the exchange rates prevailing on the date of the transaction.
All exchange differences arising on settlement and conversion on foreign currency transaction are included in the Statement of Profit and Loss, except in cases where they relate to the acquisition of fixed assets, in which case they are adjusted in the cost of the corresponding asset.
In respect of transactions covered by forward exchange contracts, the difference between the forward rate and the exchange rate at the date of transaction is recognized as income or expense at the time of maturity date, except where it relates to fixed assets, in which case it is adjusted in the cost of the corresponding assets.
r. Employee Benefits
Employee benefits are accrued in the period in which the associated services are rendered by employees of the company, as detailed below:
(a) Defined Contribution Plan (Provident fund) In accordance with Indian law, all employees receive benefits from a provident fund, which is a defined contribution plan. Both the employees and employer make monthly contributions to the plan, each equal to a specified percentage of employee's basic salary. Obligation for contributions to the plan is recognized as an employee benefit expense in Profit and Loss when incurred.
(b) Defined Benefit Plans (Gratuity)
The company has changed its accounting policy of making provision for gratuity expense from Cash basis to accrual basis for the period ended March 31,2025.
s. Provisions and Contingencies
A provision is recognized if, as a result of a past event, the Company has a present legal obligation that is reasonably estimate, and it is probable that an outflow of economic benefits will be required to settle the obligation. Provisions are determined by the best estimate of the outflow of economic
benefits required to settle the obligation at the reporting date. Where no reliable estimate can be made, a disclosure is made as contingent liability. A disclosure for contingent liability is also made when there is a possible obligation or a present obligation that may, but probably will not, require an outflow of resources. Where there is a possible obligation or a present obligation in respect of which the likelihood of outflow of resources is remote, no provision or disclosure is made.
t. Taxes on Income
Income tax expenses for the year comprises of current tax and deferred tax. Current tax provision is determined on the basis of taxable income computed as per the provisions of the Income Tax Act. Deferred tax is recognized for all timing differences that are capable of reversal in one or more subsequent periods subject to conditions of prudence and by applying tax rates that have been substantively enacted by the balance sheet date.
u. Earnings per Share
Basic and diluted earnings per share are computed in accordance with Accounting Standard -20. Basic earnings per share is calculated by dividing the net profit or loss after tax for the year attributable to equity shareholders by the weighted average number of equity shares outstanding during the year. Diluted earnings per equity share are computed using the weighted average number of equity shares and dilutive potential equity shares outstanding during the year, except where the results are anti-dilutive in the case of bonus issue since, The bonus issue is an issue without consideration, the issue is treated as it had occurred prior to the beginning of the year, the earliest period reported.
v. Other Accounting Policies:
Accounting policies not specifically referred to are generally and in all material aspects in conformity with Generally Accepted Accounting Principles (GAAP) in India.
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