C. Summary of Material Accounting Policies
A summary of the Material accounting policies applied in the preparation of the financial statements are as
given below. These accounting policies have been applied consistently to all periods presented in the company's
financial statements.
C.1. Property, Plant, and Equipment
0.1.1. Initial Recognition and Measurement
Items of Property, Plant, and Equipment are stated at cost, which includes capitalized borrowing costs, less
accumulated depreciation, and accumulated impairment Losses, if any.
The cost of an item of property, plant, and equipment comprises its purchase price, including import duties
and non-refundable purchase taxes, after deducting trade discounts and rebates, any directly attributable
cost of bringing the items to its working condition for its intended use and estimated cost of dismantling
and removing the item and restoring the site on which it is located.
The cost of self-constructed property, plant, and equipment comprises the cost of materials and direct
labour, any other costs directly attributable to bringing the item to working condition for its intended use,
and estimated costs of dismantling and removing the item and restoring the site on which it is located.
If significant parts of an item of property, plant, and equipment have different useful lives, then they are
accounted for as separate items (major components) of property, plant, and equipment.
Any gain or Loss on disposal of an item of property, plant, and equipment is recognized in Profit or Loss.
C.1.2.Subsequent Costs
Subsequent expenditure is recognized as an increase in the carrying amount of the asset when it is probable
that future economic benefits deriving from the cost incurred will flow to the enterprise and the cost of the
item can be measured reliably.
The cost of replacing part of an item of Property, Plant, and Equipment is recognized in the carrying amount
of the item if it is probable that the future economic benefits embodied within the part will flow to the
Company and its cost can be measured reliably. The carrying amount of the replaced part is derecognized.
The costs of the day-to-day servicing of Property, plant, and equipment are recognized in Profit or
Loss as incurred.
C.1.3.Decommissioning Costs
The present value of the expected cost for the decommissioning of the asset after its use is included in the
cost of the respective asset if the recognition criteria for a provision are met.
C.1.4.De-recognition
Property, Plant, and Equipment are derecognized when no future economic benefits are expected from
their use or upon their disposal. Gains and Losses on disposal of an item of Property, Plant, and Equipment
are determined by comparing the proceeds from disposal with the carrying amount of Property, Plant, and
Equipment, and are recognized in the Statement of Profit and Loss.
C.1.5.Capital Work-In-Progress
Expenditure related to and incurred during implementation of capital projects to get the assets ready for
intended use is included under "Capital Work in Progress". The same is allocated to the respective items
of property plant and equipment on completion of construction/ erection of the capital project/ property
plant and equipment. The cost of asset not ready for its intended use before the year end is disclosed under
capital work in progress.
Depreciation on additions to/deductions from Property, Plant &Equipment during the Year is charged on a pro¬
rata basis from/up to the date in which the asset is available for use/disposed of.
Depreciation method, useful lives, and residual values are reviewed at each FinancialYear-end and adjusted
if appropriate, the management believes that its estimates of useful lives as given above best represent the
period over which management expects to use these assets.
The residual values, useful lives, and method of depreciationof Property, Plant and Equipment are reviewed at
the end of each FinancialYear.
C.3. Leases
The Company, as a lessee, recognizes a right-of-use asset and a lease liability for its leasing arrangements, if the
contract conveys the right to control the use of an identified asset. The contract conveys the right to control the
use of an identified asset if it involves the use of an identified asset and the Company has substantially all of the
economic benefits from the use of the asset and has the right to direct the use of the identified asset. The cost of
the right-of-use asset shall comprise the amount of the initial measurement of the lease liability adjusted for any
lease payments made at or before the commencement date plus any initial direct costs incurred. The right-of-
use assets are subsequently measured at cost less any accumulated depreciation, accumulated impairment
Losses, if any, and adjusted for any remeasurement of the lease liability. The right-of-use assets are depreciated
using the Straight-Line method from the commencement date over the shorter lease term or useful life of a
right-of-use asset. The Company measures the lease liability at the present value of the lease payments that
are not paid at the commencement date of the lease.
C.4. Intangible Assets
Intangible Assets are stated at cost of acquisition net of recoverable Taxes, Trade Discount, and Rebates less
Accumulated Amortization/Depletion and Impairment Losses if any. Such cost includes purchase price, borrowing
costs, and any cost directly attributable to bringing the asset to its working condition for the intended use, net
charges on foreign exchange contracts, and adjustments arising from exchange rate variations attributable to
the Intangible Assets. Subsequent costs are included in the asset's carrying amount or recognized as a separate
asset, as appropriate, only when it is probable that future economic benefits associated with the item will flow to
the entity and the cost can be measured reliably. Gains or Losses arising from the derecognition of an Intangible
Asset are measured as the difference between the net disposal proceeds and the carrying amount of the asset
and are recognized in the Statement of Profit and Loss when the asset is derecognized. The Company's intangible
assets comprise assets with finite useful life which are amortized over the period of their expected useful life.
C.5. Investment Properties
C.5.1.Recognition and Initial Measurement
Investment properties are properties held to earn rentals or for capital appreciation, or both. Investment
properties are measured initially at their cost of acquisition, including transaction costs. The cost comprises
purchase price, borrowing cost if capitalization criteria are met, and directly attributable cost of bringing
the asset to its working condition for the intended use. Any trade discount and rebates are deducted in
arriving at the purchase price when significant parts of investment property are required to be replaced at
intervals, the Company depreciates them separately based on their specific useful life.
Subsequent costs are included in the asset's carrying amount or recognized as a separate asset, as
appropriate, only when it is probable that future economic benefits associated with the item will flow
to Company.All other repair and maintenance costs are recognized in the Statement of Profit and
Loss as incurred.
C.5.2 SubsequentMeasurement (Depreciation and Useful Lives)
Investment properties are subsequently measured at cost less accumulated depreciation and impairment
Losses if any. Depreciation on investment properties is provided on the Written Down methodbased on a
technical evaluation and management assessment. Useful Life as per management estimate is given below:
The residual values, useful lives, and method of depreciation are reviewed at the end of the FinancialYear.
The Company measures investment property using Cost-based measurement.
C.5.3 De-recognition
Investment properties are de-recognized either when they have been disposed of or when they are
permanently withdrawn from use and no future economic benefit is expected from their disposal. The
difference between the net disposal proceeds and the carrying amount of asset is recognized in Profit and
Loss in the period of de-recognition.
C.6. Borrowing costs
Borrowing costs are interest and other costs incurred in connection with the borrowings of funds. Borrowing
costs that are directly attributable to the acquisition or construction of qualifying assets are capitalized as part
of the cost of such asset until such time the assets are substantially ready for their intended use. Qualifying
assets are assets that take a substantial period of time to get ready for their intended use or sale.
Capitalization of borrowing costs ceases when substantially all the activities necessary to prepare the qualifying
assets for their intended uses are complete. Borrowing costs consist of interest and other costs that an entity
incurs in connection with the borrowing of funds. Income earned on the temporary investment of the borrowings
pending their expenditure on the qualifying assets will be deducted from the borrowing costs eligible for
capitalization in case such a situation arises.
Other borrowing costs are recognized as an expense in the year in which they are incurred.
C.7. Impairment of Non-Financial assets
The carrying amounts of the Company's Non-FinancialAssets are reviewed at each Reporting date to determine
whether there is any indication of impairment considering the provisions of Ind AS 36 'Impairment of Assets'. If
any such indication exists, then the asset's recoverable amount is estimated.
The recoverable amount of an asset or cash-generating unit is the higher of its fair value less costs to disposal and
its value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using
a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to
the asset. For the purpose of impairment testing, assets that cannot be tested individually are grouped together into
the smallest group of assets that generates cash inflows from continuing use that are largely independent of the
cash inflows of other assets or groups of assets (the "cash-generating unit", or "CGU"). To determine the impairment
of a corporate asset, the recoverable amount is determined for the CGUs to which the corporate assets belong.
Impairment Losses recognized in prior periods are assessed at each Reporting date for any indications that
the Loss has decreased or no longer exists. An impairment loss is reversed if there has been a change in the
estimates used to determine the recoverable amount. An impairment loss is reversed only to the extent that
the asset's carrying amount does not exceed the carrying amount that would have been determined, net of
Depreciation or Amortization, if no Impairment Loss had been recognized.
C.8. Inventories
Inventories are valued at the lower of Cost or NetRealizableValue after providing for obsolescence and other Losses
wherever considered necessary. Cost of inventories comprises of cost of purchase, cost of conversion, and other
costs incurred in bringing the inventories to their present location and condition. The cost of purchase consists of
the purchase price including duties and taxes other than those subsequently recoverable by the enterprise from
the taxing authorities, freight inwards, and other expenditures directly attributable for its acquisition.
Net Realizable Value is the estimated selling price in the ordinary course of business, less estimated costs of
completion, and the estimated costs necessary to make the sale.
Appropriate adjustments are made to the carrying value of damaged, slow-moving, and obsolete inventories
based on management's current best estimate.
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