3. Summary of Significant Material Accounting Policies
The Material Accounting Policies applied in preparation of the Standalone Financial Statements are as given below:
3.1 Basis of Preparation and Measurement
The Standalone Financial Statements have been prepared on Historical Cost basis except for certain Financial Assets
and Financial Liabilities which are measured at fair values as explained in relevant Accounting Policies. These policies
have been applied consistently for all the periods presented in the Standalone Financial Statements.
3.2 Revenue Recognition
The Company is not engaged in any other business activity, except to hold the Equity Shares of Balmer Lawrie & Co.
Ltd. Revenue arises mainly from the Interest income and Dividend income which are recognized in compliance with the
applicable Ind AS.
Interest Income is recognized on a time proportion basis taking into account the amount outstanding and rate applicable.
For all Financial Assets measured at amortized cost, interest income is recorded using the effective interest rate, i.e.
the rate that exactly discounts estimated future cash receipts through the expected life of the Financial Asset to the net
carrying amount of the Financial Assets.
Dividend Income
Income from Dividend on Investment in Subsidiary is considered on accrual basis when company's right to receive
payment is established.
Other Income
Other income, if any, is recognized in accordance with the relevant Ind AS.
3.3 Financial instruments
Recognition, initial measurement and derecognition.
Financial Assets and Financial Liabilities are recognized when the Company becomes a party to the contractual
provisions of the Financial Instrument and are measured initially at fair value adjusted by transaction costs, except
for those carried at fair value through profit or loss (FVTPL) which are measured initially at fair value. However, trade
receivables that do not contain a significant financing component are measured at transaction price. Subsequent
measurements of Financial Assets and Financial Liabilities are described below.
Financial Assets are derecognized when the contractual rights to the cash flows from the Financial Asset expire, or when
the Financial Asset and all substantial risks and rewards are transferred. A Financial Liability is derecognized when it is
extinguished, discharged, cancelled or expires.
Classification and subsequent measurement of Financial Assets
For the purpose of subsequent measurement, Financial Assets are classified into the following categories upon initial
recognition:
• Amortized cost
• Financial Assets at fair value through profit or loss (FVTPL)
• Financial Assets at fair value through other comprehensive income (FVOCI), if required
• Investments in Equity Shares of subsidiaries (carried at cost in accordance with Ind AS 27 read with Ind AS 101)
All Financial Assets except for those at FVTPL are subject to review for impairment.
Amortized cost
A Financial Asset is measured at amortized cost using Effective Interest Rate (EIR) if both of the following conditions
are met:
a) the Financial Asset is held within a business model whose objective is to hold Financial Assets to collect contractual
cash flows; and
b) 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.
A loss allowance for expected credit losses is recognized on Financial Assets carried at amortized cost.
Since the company is not allowed to carry on any business activity, except to hold equity shares of M/s Balmer Lawrie
& Co. Ltd., there is no Financial Asset classified under FVTPL & FVOCI.
3.4 impairment of Financial Assets
In respect of impairment of its Financial Assets, the Company assesses if the credit risk on those Financial Assets has
increased significantly since initial recognition.
To make that assessment, the Company compares the risk of a default occurring on the Financial Asset as at the
Balance Sheet date with the risk of a default occurring on the Financial Asset as at the date of initial recognition. The
Company also considers reasonable and supportable information, that is available without undue cost or effort, that is
indicative of significant increases in credit risk since initial recognition. The Company assumes that the credit risk on a
Financial Asset has not increased significantly since initial recognition if the financial asset is determined to have low
credit risk at the balance sheet date.
Write-offs
Financial assets are written off either partially or in their entirety only when the Company has stopped pursuing the
recovery.
3.5 Cash and Cash Equivalents
Cash and Cash Equivalents comprise cash on hand, balance lying with the banks under current account and demand
deposits, together with other short-term, highly liquid investments (original maturity less than three months) that are
readily convertible into known amounts of Cash and which are subject to an insignificant risk of changes in value.
3.6 employee Benefits expenses
Employee Benefits comprise of salaries and wages of staff deployed by service provider and it includes contribution
to provident fund and superannuation fund which was reimbursed to the service provider, who maintains and makes
provisions for the aforesaid amounts.
3.7 segment Reporting
The Company's only business is investment in its subsidiary M/s Balmer Lawrie & Co. Ltd., and hence segment reporting
as envisaged by Ind AS 108 is not applicable to the Company for Standalone Financial Statements.
3.8 Material Prior Period errors
Material prior period errors are corrected retrospectively by restating the comparative amounts for the prior periods
presented in which the error occurred. If the error occurred before the earliest period presented, the opening balances
of assets, liabilities and equity for the earliest period presented are restated.
Prior period errors are corrected by retrospective restatement except to the extent that it is impracticable to determine
either the period-specific effects or the cumulative effect of the error.
The value of error and omission is construed to be material for restating the opening balances of Assets and
Liabilities and Equity for the earliest prior period presented if the amount in aggregate for all cases of prior
period income/ expenses exceeds 1% of the revenue from operations of the previous year.
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