Avonmore Capital & Management Services Limited (‘the
Company’) is a company domiciled in India, with its registered
office situated at Level 5, Grande Palladium, 175 CST Road, Off
BKC Kalina, Santacruz Mumbai - 400098. The Company was
incorporated in India on September 30,1991 and is presently listed
on the Bombay Stock Exchange ('BSE') and National Stock
Exchange {'NSE'). The Company registered with the Reserve Bank
of India ('RBI') on October 7, 2008 as a non-deposit accepting
non-banking financial corporation (’NBFC) and is involved in the
business of providing loans and advances to corporations as well
as sub-broker advisory services.
1. Basis of preparation
(i) Statement of compliance with Indian Accounting
Standards:
These Ind AS financial statements ("the Financial
Statements”) have been prepared in accordance with the
Indian Accounting Standards find AS') as notified by Ministry
of Corporate Affairs (‘MCA’) under Section 133 of the
Companies Act, 2013 ('Act’) read with the Companies (Indian
Accounting Standards) Rules, 2015, as amended and other
relevant provisions of the Act. The Company has uniformly
applied the accounting policies for all the periods presented
in these financial statements.
The financial statements for the year ended March 31,2025
were authorised and approved for issue by the Board of
Directors on May 30, 2025,
The significant accounting policies adopted for preparation
and presentation of these financial statement are included
in Note 2. These policies have been applied consistently
applied to all the financial year presented in the financial
statements except where newly issues accounting standard
is initially adopted or revision to the existing accounting
standard requires a change in the accounting policy hitherto
in use.
The Balance Sheet, the Statement of Changes in Equity,
the Statement of Profit and Loss and disclosures are
presented in the format prescribed under Division lit of
Revised Schedule ill of the companies Act, as amended
from time to time that are required to comply with Ind AS.
The Statement of Cash Flows has been presented as per
the requirements of Ind AS 7 Statement of Cash Flow.
The financial statements have been prepared under the
historical cost convention and accrual basis, except for
certain financial assets and liabilities, defined benefit-plan
liabilities and share-based payments being measured affair
value.
(ii) Functional and presentation currency
These financial statements are presented in Indian Rupees
(' ), which is also the Company's functional currency. All
amounts have been rounded-off to the nearest lacs, unless
otherwise indicated.
(iii) Basis of measurement
The financial statements have been prepared on the
historical cost basis except for the following items:
(iv) Use of estimates and judgements
The preparation of the Company's financial statements
requires management to make judgements, estimates and
assumptions that affect the reported amounts of revenues,
expenses, assets and liabilities, and the related disclosures.
Actual results may differ from these estimates.
Significant management judgements
Recognition of deferred tax assets - The extent to which
deferred tax assets can be recognised is based on an
assessment of the probability of the future taxable income
against which the deferred tax assets can be utilised.
Business model assessment - The Company determines
the business model at a level that reflects how groups of
financial assets are managed together to achieve a business
objective. This assessment includes judgement reflecting
all relevant evidence including how the performance of the
assets is evaluated and their performance measured, the
risks that affect the performance of the assets and howthese
are managed and how the managers of the assets are
compensated. The Company monitors financial assets
measured at amortised cost that are derecognised prior to
their maturity to understand the reason for their disposal
and whether the reasons are consistent with the objective
of the business for which the asset was held. Monitoring is
part of the Company's continuous assessment of whether
the business model for which the remaining financial assets
are held continues to be appropriate and if it is not
appropriate whether there has been a change in business
model and accordingly prospective change to the
classification of those assets are made.
Evaluation of indicators for impairment of assets - The
evaluation of applicability of indicators of impairment of
assets requires assessment ot several external and internal
factors which could result in deterioration of recoverable
amount of the assets.
Classification of leases - ind AS 116 requires lessees to
determine the lease term as the non-cancellable period of a
lease adjusted with any option to extend or terminate the
lease, if the use of such option is reasonably certain. The
Company makes an assessment on the expected lease term
on a lease-by-lease basis and thereby assesses whether it
is reasonably certain that any options to extend or terminate
the contract will be exercised. In evaluating the tease term,
the Company considers factors such as any significant
leasehold improvements undertaken over the tease term,
costs relating to the termination of the lease and the
importance of the underlying asset to the Company’s
operations taking into account the location of the underlying
asset and the availability of suitable alternatives. The lease
term in future periods is reassessed to ensure that the lease
term reflects the current economic circumstances. After
considering current and future economic conditions, the
Company has concluded that no changes are required to
lease period relating to the existing lease contract.
Expected credit loss (ECL) - The measurement of
expected credit loss allowance lor financial assets measured
at amortised cost requires use of complex models and
significant assumptions about future economic conditions
and credit behaviour (e.g. likelihood of customers defaulting
and resulting losses). The Company makes significant
judgements regarding the following while assessing expected
credit loss:
* Determining criteria for significant increase in credit risk;
* Establishing the number and relative weightings of
forward-looking scenarios for each type of product/
market and the associated ECL; and
* Establishing groups of similar financial assets for the
purposes of measuring ECL.
Provisions - At each balance sheet date, based on the
management judgment, changes In facts and legal aspects,
the Company assesses the requirement of provisions against
the outstanding contingent liabilities. However, the actual
future outcome may be different from this judgement.
Significant estimates
Useful lives of depreciable/amortisable assets -
Management reviews its estimate ot useful lives, residual
values and method of depreciation of depreciable/
amortisable assets at each reporting date, based on the
expected utility of the assets. Uncertainties in these
estimates relate to technical and economic obsolescence
that may change the utility of assets.
Defined benefit obligation (DBO) - Management’s estimate
of the DBO is based on several underlying assumptions such
as standard rates of inflation, mortality, discount rate and
anticipation of future salary increases. Variation in these
assumptions may significantly impact the DBO amount and
the annual defined benefit expenses.
Pair value measurements - Management applies valuation
techniques to determine the fair value of financial instruments
(where active market quotes are not available). This involves
developing estimates and assumptions consistent with how
market participants would price the instrument.
2,1 Summary of significant accounting policies
(i) Cash and cash equivalents
Cash and cash equivalents consist of cash, bank balances
in current and short term highly liquid investments that are
readily convertible to cash with original maturities of three
months or less at the time ot purchase.
(ii) Provisions, contingent liabilities and contingent assets
Provisions are recognised only when there is a present
obligation, as a result of past events, and when a reliable
estimate of the amount of obligation can be made at the
reporting date. These estimates are reviewed at each
reporting date and adjusted to reflect the current best
estimates, Provisions are discounted to their present values,
where the time value of money is material.
Contingent liability is disclosed for:
• Possible obligations which will be confirmed only by
future events not wholly within the control of the
Company or
• Present obligations arising from past events where it is
not probable that an outflow of resources will be required
to settle the obligation or a reliable estimate of the
amount of the obligation cannot be made.
Contingent assets are neither recognised nor disclosed
except when realisation ot Income is virtually certain, related
asset is disclosed.
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