1 CORPORATE INFORMATION
Bhartiya International Limited ( 'the Company') is a public limited company with domiciled in India and incorporated
under the provisions of the Companies Act applicable in India. Its shares are listed on leading stock exchange in India.
The Company has its registered office at Chennai and its corporate office at Gurugram, Haryana. The Company is in
the business of manufacturing and trading of leather products & textile products.
2 BASIS OF PREPARATION
These financial statements have been prepared in accordance with the Indian Accounting Standards (hereinafter referred
to as the 'Ind AS') as notified by Ministry of Corporate Affairs pursuant to Section 133 of the Companies Act, 2013
('Act') read with ofthe Companies (Indian Accounting Standards) Rules,2015.
The financial statements have been prepared on the historical cost basis except the certain financial instruments that are
measured at fair values at the end of each reporting period, as explained in the accounting policies.
Based on the nature of products/activities and the time between acquisition of assets and their realisation in cash and
cash equivalents, the Company has ascertained its operating cycle as 12 months for the purpose of current or non-
currentclassification ofassets and liabilities.
3 MATERIAL ACCOUNTING POLICIES
3.1 Property, Plant and Equipment
Freehold land is carried at cost. All other items of property, plant and equipment and Capital work in progress
(including Pre-operative expenses ) are measured at cost less accumulated depreciation and impairment losses, if
any. Cost includes expenditures directly attributable to the acquisition of the asset. General and specific borrowing
costs directly attributable to the construction of a qualifying asset are capitalized as part of the cost.
Depreciation is charged on a pro-rata basis at the straight-line method over estimated economic useful lives of its
property, plant and equipment generally in accordance with that provided in the Schedule II.
Assets acquired under finance lease and leasehold improvements are amortized over the shorter of estimated
useful life of the asset or the related lease term.
3.2 Investment Properties
Property that is held for long-term rental yields or for capital appreciation or both, and that is not occupied by
the Company, is classified as investment property. Investment property is measured at its cost, including related
transaction costs and applicable borrowing costs less depreciation and impairment if any.
Depreciation is charged on a pro-rata basis at the straight-line method over estimated economic useful lives of
building generally in accordance with that provided in the Schedule II of the Companies Act.
3.3 Intangible Assets
Computer Software
Computer software are stated at cost, less accumulated amortisation and impairments, if any.
Amortisation Method and Useful Life
The Company amortizes computer software using the straight-line method over the period of 3 years.
3.4 Lease
Effective from 1st April, 2019, the Company adopted Ind AS 116 - Leases and applied the standard to all lease
contracts existing as on 1st April, 2019 using the modified retrospective method on the date of initial application
i.e. 1st April, 2019.
At inception of a contract, the Company assesses whether a contract is, or contains, a lease. A contract is, or
contains, a lease if the contract conveys the right to control the use of an identified asset for a period of time in
exchange for consideration.
Company as a Lessee
The Company applies a single recognition and measurement approach for all leases, except for short-term leases
and leases of low value assets. The Company recognises lease liabilities to make lease payments and right-of-use
assets representing the right to use the underlying assets.
(i) Right-ot-use Assets (ROU Assets)
The Company recognises right-of-use assets at the commencement date of the lease (i.e., the date the
underlying asset is available for use). Right-of-use assets are measured at cost, less any accumulated
depreciation and impairment losses, and adjusted for any remeasurement of lease liabilities. The cost of
right-of-use assets includes the amount of lease liabilities recognised, initial direct costs incurred, and lease
payments made at or before the commencement date less any lease incentives received. Right-of-use assets
are depreciated on a straight-line basis over the shorter of the lease term and the estimated useful lives of the
assets.
If ownership of the leased asset transfers to the Company at the end of the lease term or the cost reflects
the exercise of a purchase option, depreciation is calculated using the estimated useful life of the asset. The
right-of-use assets are also subject to impairment.
(ii) Lease Liabilities
At the commencement date of the lease, the Company recognises lease liabilities measured at the present
value of lease payments to be made over the lease term. The lease payments include fixed payments (including
in substance fixed payments) less any lease incentives receivable, variable lease payments that depend on
an index or a rate, and amounts expected to be paid under residual value guarantees. The lease payments
also include the exercise price of a purchase option reasonably certain to be exercised by the Company
and payments of penalties for terminating the lease, if the lease term reflects the Company exercising the
option to terminate. Variable lease payments that do not depend on an index or a rate are recognised as
expenses (unless they are incurred to produce inventories) in the period in which the event or condition
that triggers the payment occurs. In calculating the present value of lease payments, the Company uses its
incremental borrowing rate at the lease commencement date because the interest rate implicit in the lease is
not readily determinable. After the commencement date, the amount of lease liabilities is increased to reflect
the accretion of interest and reduced for the lease payments made. In addition, the carrying amount of lease
liabilities is remeasured if there is a modification, a change in the lease term, a change in the lease payments
(e.g., changes to future payments resulting from a change in an index or rate used to determine such lease
payments) or a change in the assessment of an option to purchase the underlying asset. Lease liability and
ROU assets have been separately presented in the Balance Sheet and lease payments have been classified
as financing cash hows.
(iii) Short-term Leases and Leases ot Low-Value Assets
The Company applies the short-term lease recognition exemption to its short-term leases of machinery and
equipment (i.e., those leases that have a lease term of 12 months or less from the commencement date and
do not contain a purchase option). It also applies the lease of low-value assets recognition exemption to
leases of office equipment that are considered to be low value. Lease payments on short-term leases and
leases of low-value assets are recognised as expense on a straight-line basis over the lease term.
Company as a Lessor
Leases in which the Company does not transfer substantially all the risks and rewards incidental to ownership
of an asset are classified as operating leases. Rental income arising is accounted for on a straight-line basis
over the lease terms. Initial direct costs incurred in negotiating and arranging an operating lease are added
to the carrying amount of the leased asset and recognised over the lease term on the same basis as rental
income. Contingent rents are recognised as revenue in the period in which they are earned.
3.5 Investment In Subsidiaries And Associates
Investments in subsidiaries and associates are carried at cost less accumulated impairment losses, if any. Where an
indication of impairment exists permanently, the carrying amount of the investment is assessed and written down
immediately to its recoverable amount. On disposal of investments in subsidiaries and associates, the difference
between net disposal proceeds and the carrying amounts are recognized in the Statement of Profit and Loss.
3.6 Inventories
Raw materials and consumables have been valued at cost after providing for obsolescence. Cost comprise of
cost of purchase and other cost incurred in bringing the inventories to their present location and condition. Cost
is determined on FIFO basis. Finished goods are value at cost or net realisable value whichever is lower. Cost of
finished goods and work-in- progress include all costs of purchases, conversion costs and other costs incurred in
bringing the inventories to their present location and condition. The net realisable value is the estimated selling
price in the ordinary course of business less the estimated costs of completion and estimated costs necessary to
make the sale.
3.7 Cash & Cash Equivalents
The Company's cash and cash equivalents consist of cash on hand and in banks and demand deposits with banks,
which can be withdrawn at any time, without prior notice or penalty on the principal.
For the purposes of the cash how statement, cash and cash equivalents include cash on hand, in banks and demand
deposits with banks, net of outstanding bank overdrafts that are repayable on demand and are considered part of
the Company's cash management system. In the balance sheet, bank overdrafts are presented under other current
liabilities.
3.8 Employee Benefits
Defined Contribution Plan
Retirement benefit in the form of provident fund is a defined contribution scheme. The Company has no obligation,
other than the contribution payable to the provident fund. The Company recognizes contribution payable to the
provident fund scheme as expenditure, when an employee renders the related service.
Defined Benefit Plan
Gratuity is a defined benefit obligation. The Company accounts for the gratuity liability, based upon the actuarial
valuation performed in accordance with the Projected Unit Credit method carried out at the year end, by an
independent actuary.
Re-measurement, comprising actuarial gains and losses and the return on plan assets (excluding net interest), is
reflected immediately in the balance sheet with a charge or credit recognised in other comprehensive income in the
period in which they occur. Re-measurement recognised in other comprehensive income is reflected immediately in
retained earnings and is not reclassified to profit or loss.
3.9 Financial Instruments
A financial instrument is any contract that gives rise to a financial asset of one entity and a financial liability or
equity instrument of another entity.
Financial Assets
Financial assets are recognised when the Company becomes a party to the contractual provisions of the instrument.
On initial recognition, a financial asset is recognised at fair value, in case of Financial assets which are recognised
at fair value through profit and loss (FVTPL), its transaction cost are recognised in the statement of profit and loss.
In other cases, the transaction cost are attributed to the acquisition value of the financial asset.
Financial Assets are subsequently classified as measured at
• amortised cost
• fair value through profit and loss (FVTPL)
• fair value through other comprehensive income (FVOCI).
Debt Instruments
Debt instruments are initially measured at amortised cost, fair value through other comprehensive income ('FVOCI')
or fair value through profit or loss ('FVTPL') till derecognition on the basis of (i) the entity's business model for
managing the financial assets and (ii) the contractual cash flow characteristics of the financial asset.
(a) Measured at Amortised Cost:
Financial assets that are held within a business model whose objective is to hold financial assets in order to
collect contractual cash flows that are solely payments of principal and interest, are subsequently measured
at amortised cost using the effective interest rate ('EIR') method less impairment, if any. The amortisation of
EIR and loss arising from impairment, if any is recognised in the Statement of Profit and Loss.
(b) Measured at Fair Value through Other Comprehensive Income:
Financial Assets that are held within a business model whose objective is achieved by both, selling financial
assets and collecting contractual cash flows that are solely payments of principal and interest, are subsequently
measured at fair value through other comprehensive income. Fair value movements are recognized in the
other comprehensive income (OCI). On derecognition, cumulative gain or loss previously recognised in OCI
is reclassified from the equity to 'other income' in the Statement of Profit and Loss.
(c) Measured at Fair Value through Profit or Loss:
A financial asset not classified as either amortised cost or FVOCI, is classified as FVTPL. Such financial assets
are measured at fair value with all changes in fair value, including interest income and dividend income if
any, recognised as 'other income' in the Statement of Profit and Loss.
Equity Instruments:
All investments in equity instruments classified under financial assets are initially measured at fair value , the
Company may, on initial recognition, irrevocably elect to measure the same either at FVOCI or FVTPL.
The Company makes such election on an instrument-by-instrument basis. Fair value changes on an equity instrument
is recognised as other income in the Statement of Profit and Loss unless the Company has elected to measure such
instrument at FVOCI. Fair value changes excluding dividends, on an equity instrument measured at FVOCI are
recognised in OCI. Amounts recognised in OCI are not subsequently reclassified to the Statement of Profit and
Loss. Dividend income on the investments in equity instruments are recognised as 'other income' in the Statement
of Profit and Loss.
Derecognition
The Company derecognises a financial asset when the contractual rights to the cash hows from the financial asset
expire, or it transfers the contractual rights to receive the cash hows from the asset.
Financial Liabilities
Initial recognition and Measurement
Financial liabilities are recognised when the Group becomes a party to the contractual provisions of the instrument.
Financial liabilities are initially measured at the amortised cost unless at initial recognition, they are classified as
fair value through profit and loss.
Subsequent Measurement
Financial liabilities are subsequently measured at amortised cost using the EIR method. Financial liabilities carried
at fair value through profit or loss are measured at fair value with all changes in fair value recognised in the
Statement of Profit and Loss.
Loans and Borrowings
After initial recognition, interest-bearing loans and borrowings are subsequently measured at amortised cost using
the EIR method. Gains and losses are recognised in profit or loss when the liabilities are derecognised as well as
through the EIR amortisation process.
Amortised cost is calculated by taking into account any discount or premium on acquisition and fees or costs that
are an integral part of the EIR. The EIR amortisation is included as finance costs in the statement of profit and loss.
Trade and Other Payable
These amounts represent liabilities for goods and services provided to the Company prior to the end of financial
year which are unpaid. The amounts are generally unsecured. Trade and other payable are presented as current
liabilities unless payment is not due within 12 months after the reporting period. They are recognized initially at
their fair value and subsequently measured at amortized cost using effective interest method.
Derecognition
A financial liability is derecognised when the obligation specified in the contract is discharged, cancelled or
expires.
Derivative Instruments
The Company enters into foreign exchange forward contracts to manage its exposure to foreign exchange rate
risks. These contracts are initially recognised at fair value and subsequently, at the end of each reporting period,
re-measured at their fair values on reporting date. The resulting gain or loss is recognised in profit or loss in the
same line as the movement in the hedged exchange rate.
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