Note 2 - Significant Accounting Policies
2.1 Basis of Preparation of Financial Statements
a) . Compliance with Ind AS
These financial statements have been prepared in accordance with the Indian Accounting
Standards ("Ind AS”) as prescribed under Section 133 of the Companies Act, 2013 read
with Companies (Indian Accounting Standards) Rules, 2015 and relevant provisions of the
Companies Act, 2oi 3 ("the Act”).
b) . Historical Cost Convention -The financial statements have been prepared on a
historical cost basis, except for the following: - certain financial assets and liabilities are
measured at fair value for the purpose of defined benefit plans.
i. Use of Estimates and Judgement Preparation of the Company's standalone financial
statements requires management to make judgements, estimates and assumptions which
affect the reported amounts of revenue, expenses, assets and liabilities, accompanying
disclosures, and disclosure of contingent liabilities.
Uncertainty about these assumptions and estimates could result in outcomes which
require material adjustment to the carrying amount of assets or liabilities in future years.
Estimates and Assumptions :- Estimates are reviewed on an ongoing basis.
Revisions to estimates are recognized in the year in which the estimates are revised and
future periods are affected.
Key assumptions concerning the future and other sources of estimation uncertainty at the
reporting date, which have significant risk of causing a material adjustment to the carrying
amounts of assets and liabilities within the next financial year, are described below.
Ý Company has based its estimates on parameters available when the financial
statements were prepared.
Ý Existing circumstances and assumptions about future developments, may change
due to market changes or circumstances arising that are beyond the control of the
Company.
Ý Such changes are reflected in the assumptions when they occur.
ii. Revenue Recognition: -Income and expenditure is recognized and accounted on accrual
basis as and when they are earned or incurred. Revenue from sales transaction is
recognized as and when the significant risk and reward attached to ownership in the goods
is transferred to the buyer. Revenue from sale of goods/services is recognized on
completion of sale of goods and is recorded net of trade discount and rebates and GST is
accounted for on exclusive accounting method which does not get included in sales.
iii. Impairment of Assets: - Impairment loss is charged to the statement of profit and loss in
the year in which an asset is identified as impaired. During the year, the company has
provided for expected credit losses as outlined in "three-stage” model for impairment
based on changes in credit quality as required under IND AS 109.
iv. Cash & Cash Equivalents: Cash comprises cash on hand and term deposit with banks.
v. Inventories of equity shares are valued at Cost.
vi. Property, Plant and Equipment: - Items of Property, plant and equipment acquired are
recognized at historical cost net of recoverable taxes, duties, trade discounts and rebates,
less accumulated depreciation .
The historical cost of Property, plant and equipment comprises of its purchase price,
borrowing costs and any cost attributable to bringing the assets to their working condition
for their intended use.
Depreciation on Fixed Assets is provided to the extent of depreciable amount on the
Written down Value (WDV) Method. Depreciation is provided based on useful life of the
assets as prescribed in Schedule II to the Companies Act, 2013.
vii. Intangible Assets are stated at cost of acquisition net of recoverable taxes, trade
discounts and rebates less accumulated amortization. Such cost includes purchase price,
borrowing costs, and any cost directly attributable to bringing the asset to its working
condition for the intended use.
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