2. Material accounting policies
Statement of compliance and basis of preparation
A. Statement of Compliance
The standalone financial statements of the Company
comply in all material aspects with Indian Accounting
Standards (Ind AS) notified under Section 133 of the
Companies Act, 2013 (the 'Act') read with the Companies
(Indian Accounting Standards) Rules, 2015 as amended
from time to time and other relevant provisions of the Act.
These standalone financial statements have been prepared
in accordance with Ind AS 1 - Presentation of Financial
Statements as notified under the Companies (Indian
Accounting Standards) Rules, 2015 read with Section 133
of the Companies Act, 2013.
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 II of Schedule III 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 Flows.
The financial statements for the year ended March 31,
2026 are being authorized for issue in accordance with a
resolution of the directors on April 20, 2026.
The principal accounting policies applied in the preparation
of the financial statements are set out below. These policies
have been consistently applied to all the years presented,
unless otherwise stated.
B. Basis of Preparation
The standalone financial statements have been prepared
under the historical cost convention and on accrual basis,
except for certain financial assets and liabilities.
C. Functional and Presentation Currency
Accounting policies have been consistently applied except
where newly issued accounting standard is initially adopted
or a revision to an existing accounting standard requires
a change in the accounting policy hitherto in use. The
Company's financial statements are presented in Indian
Rupees (INR)/(Rs.), which is also its functional currency and
all values are rounded to the nearest millions, except when
otherwise indicated.
a. Property, plant and equipment
i. Recognition and measurement
Property, plant and equipment are stated at cost less
accumulated depreciation and accumulated impairment
losses, if any. Subsequent costs are included in the asset's
carrying amount.
Items of property, plant and equipment are initially recorded
at cost. Cost comprises acquisition cost, borrowing cost
if capitalization criteria are met, and directly attributable
cost of bringing the asset to its working condition for the
intended use. Subsequent expenditure relating to property,
plant and equipment is capitalized only when it is probable
that future economic benefit associated with these will
flow with the Company and the cost of the item can be
measured reliably.
Capital work-in-progress are property, plant and equipment
which are not yet ready for their intended use. Advances
given towards acquisition of fixed assets outstanding
at each reporting date are shown as other non-financial
assets. Depreciation is not recorded on capital work-in
progress until construction and installation is completed
and assets are ready for its intended use.
Items of Property, plant and equipment that have been
retired from active use and are held for disposal are stated
at the lower of their net book value or net realisable value
and are shown separately in the financial statements, if any.
ii. Depreciation
Depreciation provided on property, plant and equipment is
calculated on a straight line basis using the rates arrived at
based on the useful lives specified in Schedule II of the Act.
The estimated useful lives of items of property, plant and
equipment for the current and comparative periods are
as follows:
Depreciation is provided on a straight line basis from the
date the asset is ready for its intended use. In respect of
assets sold, depreciation is provided up to the date of
disposal. The residual values, estimated useful lives and
methods of depreciation of property, plant and equipment
are reviewed at the end of each financial year and changes
if any, are accounted for on a prospective basis.
Improvements to leasehold premises are amortised over
the non-cancellable period of the lease term or useful lives
of the assets, whichever is lower.
iii. De-recognition
The carrying amount of an item of property, plant and
equipment is derecognized on disposal or when no future
economic benefits are expected from its use or disposal.
Gains or losses arising from de-recognition, disposal or
retirement of an item of property, plant and equipment
are measured as the difference between the net disposal
proceeds and the carrying amount of the asset and are
recognised net, within "Other Income" or "Other Expenses",
as the case maybe, in the Statement of Profit and Loss in
the year of derecognition, disposal or retirement.
b. Intangible assets
i. Recognition and measurement
An intangible asset is recognised only when its cost can
be measured reliably, and it is probable that the expected
future economic benefits that are attributable to it will flow
to the Company. Intangible assets are capitalised at cost of
acquisition including cost attributable to readying the asset
for use. Intangible assets acquired separately are measured
on initial recognition at cost. Following initial recognition,
intangible assets are carried at cost less accumulated
amortization. The useful life of these intangible assets is
estimated at 10 years with zero residual value.
ii. Amortisation
Amortisation is provided using the straight-line method on
the cost of intangible assets over their estimated useful
lives and is included in the statement of profit and loss.
c. Investment in subsidiaries
I nvestments in subsidiaries are measured at cost less
accumulated impairment, if any.
d. Impairment of non-financial assets
The Company assesses at each balance sheet date whether
there is any indication that an asset may be impaired.
An asset is impaired when the carrying amount of the
asset exceeds its recoverable amount. An impairment loss
is charged to the Statement of Profit and Loss in the year
in which an asset is identified as impaired. An impairment
loss is reversed to the extent that the asset's carrying
amount does not exceed the carrying amount that would
have been determined if no impairment loss had previously
been recognised.
An asset's recoverable amount is the higher of an asset's
or cash-generating unit's (CGU) net selling price and its
value in use. The recoverable amount is determined for an
individual asset, unless the asset does not generate cash
inflows that are largely independent of those from other
assets or groups of assets. Where the carrying amount of
an asset or CGU exceeds its recoverable amount, the asset
is considered impaired and is written down to its recoverable
amount. 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.
In determining net selling price, recent market transactions
are taken into account, if available. If no such transactions
can be identified, an appropriate valuation model is used.
e. Financial instruments
i. Date of Recognition
Financial assets and financial liabilities are recognised in the
Company's balance sheet when the Company becomes a
party to the contractual provisions of the instrument.
ii. Initial Measurement
Financial assets and liabilities are initially recognised on the
trade date, i.e. the date on which the Company becomes
a party to the contractual provisions of the instrument.
Recognised financial instruments are initially measured at
fair value. Transaction costs that are directly attributable
to the acquisition or issue of financial assets and financial
liabilities are added to or deducted from the fair value of
the financial assets or financial liabilities, as appropriate, on
initial recognition. Transaction costs directly attributable to
the acquisition of financial assets or financial liabilities at fair
value through profit or loss are recognised immediately in
profit or loss.
iii. Classification and Subsequent Measurement
A. Financial assets
Based on the business model, the contractual
characteristics of the financial assets and specific elections
where appropriate, the Company classifies and measures
financial assets in the following categories:
a) Amortised cost: A financial assets is measured at amortised
cost if it meets both of the following conditions and is not
designated as at Fair value through profit or loss (FVTPL):
• the asset is held within a business model whose
objective is to hold assets to collect contractual
cash flows ('Asset held to collect contractual
cash flows'); and
• the contractual terms of the financial asset give rise on
specified dates to cash flows that are solely payments
of principal and interest ('SPPI') on the principal
amount outstanding.
After initial measurement and based on the assessment
of the business model as asset held to collect contractual
cash flows and SPPI, such financial assets are subsequently
measured at amortised cost using effective interest rate
('EIR') method. Interest income and impairment expenses
are recognised in profit or loss. Interest income from these
financial assets is included in finance income using the
EIR method. Any gain and loss on derecognition is also
recognised in profit or loss.
The EIR method is a method of calculating the amortised
cost of a financial instrument and of allocating interest
over the relevant period. The EIR is the rate that exactly
discounts estimated future cash flows (including all fees
paid or received that form an integral part of the EIR,
transaction costs and other premiums or discounts)
through the expected life of the instrument, or, where
appropriate, a shorter period, to the net carrying amount
on initial recognition.
b) Fair value through other comprehensive income (FVOCI):
Financial assets that are held within a business model whose
objective is both to collect the contractual cash flows and to
sell the assets, ('Contractual cash flows of assets collected
through hold and sell model') and contractual cash flows
that are SPPI, are subsequently measured at FVOCI.
Movements in the carrying amount of such financial assets
are recognised in Other Comprehensive Income ('OCI'),
except interest / dividend income which is recognised in
profit and loss. Amounts recorded in OCI are subsequently
transferred to the statement of profit and loss in case of
debt instruments however, in case of equity instruments it
will be directly transferred to reserves. Equity instruments
at FVOCI are not subject to an impairment assessment.
c) Fair value through profit or loss (FVTPL): Financial assets,
which do not meet the criteria for categorisation as at
amortised cost or as FVOCI or either designated, are
measured at FVTPL. Subsequent changes in fair value
are recognised in profit or loss. The Company records
investments in equity instruments and mutual funds
at FVTPL.
B. Financial liabilities
Debt and equity instruments issued by the Company
are classified as either financial liabilities or as equity
in accordance with the substance of the contractual
arrangements and the definitions of a financial liability and
an equity instrument.
(a) Equity Instrument - An equity instrument is any contract
that evidences a residual interest in the assets of an entity
after deducting all of its liabilities. Equity instruments issued
by the Company is recognised at the proceeds received,
net of directly attributable transaction costs.
(b) Financial Liabilities Financial liabilities are measured
at amortised cost. The carrying amounts are initially
recognised at fair value and subsequently determined
based on the EIR method. Interest expense is recognised in
profit or loss. Any gain or loss on de-recognition of financial
liabilities is also recognised in profit or loss. The Company
does not have any financial liability which are measured
at FVTPL.
Financial liabilities are carried at amortised cost using
the effective interest rate method. For trade and other
payables, the carrying amount approximates the fair value
due to short maturity of these instruments.
In order to show how fair values have been derived, financial
instruments are classified based on a hierarchy of valuation
techniques, as summarised below:
Level 1: Those where the inputs used in the valuation are
unadjusted quoted prices from active markets for identical
assets or liabilities that the Company has access to at the
measurement date. The Company considers markets as
active only if there are sufficient trading activities with
regards to the volume and liquidity of the identical assets or
liabilities and when there are binding and exercisable price
quotes available on the balance sheet date.
Level 2: Those where the inputs that are used for valuation
and are significant, are derived from directly or indirectly
observable market data available over the entire period of
the instrument's life.
Level 3: Those that include one or more unobservable input
that is significant to the measurement as whole.
Based on the Company's business model for managing the
investments, the Company has classified its investments
and securities for trade at FVTPL. Investment in subsidiaries
is carried at deemed cost (previous GAAP carrying amount)
as per Ind AS 27.
iv. Reclassification:
Financial assets and financial liabilities are not reclassified
subsequent to their initial recognition, apart from the
exceptional circumstances in which the Company acquires,
disposes of, or terminates a business line or in the period
the Company changes its business model for managing
financial assets.
v. Derecognition:
(A) A financial asset (or, where applicable, a part of a financial
asset or part of a group of similar financial assets) is
derecognised when:
• The contractual rights to receive cash flows from the
financial asset have expired, or
• The Company has transferred its rights to receive
cash flows from the asset and the Company has
transferred substantially all the risks and rewards of
the asset, or the Company has neither transferred nor
retained substantially all the risks and rewards of the
asset, but has transferred control of the asset.
If the Company neither transfers nor retains substantially
all of the risks and rewards of ownership and continues to
control the transferred asset, the Company recognises its
retained interest in the asset and an associated liability for
the amount it may have to pay.
On derecognition of a financial asset, the difference
between the carrying amount of the asset (or the carrying
amount allocated to the portion of the asset derecognised)
and the sum of (i) the consideration received (including any
new asset obtained less any new liability assumed) and (ii)
any cumulative gain or loss that had been recognised in OCI
is recognised in profit or loss (except for equity instruments
measured at FVOCI).
(B) A financial liability is derecognised when the obligation
under the liability is discharged, cancelled or expires. Where
an existing financial liability is replaced by another from the
same lender on substantially different terms, or the terms
of an existing liability are substantially modified, such an
exchange or modification is treated as a derecognition of
the original liability and the recognition of a new liability. In
this case, a new financial liability based on the modified
terms is recognised at fair value. The difference between
the carrying value of the original financial liability and the
new financial liability with modified terms is recognised in
profit or loss.
vi. Offsetting:
Financial assets and financial liabilities are offset and the
net amount presented in the balance sheet when, and only
when, the Company currently has a legally enforceable
right to set off the amounts and it intends either to settle
them on a net basis or to realise the asset and settle the
liability simultaneously.
f. Impairment of financial assets:
A. Trade receivables
The Company applies the Ind AS 109 simplified approach
to measuring expected credit losses which uses a lifetime
expected loss allowance (ECL) for all trade receivables.
The application of simplified approach does not require
the Company to track changes in credit risk. Rather, it
recognises impairment loss allowance based on lifetime
ECLs at each reporting date, right from its initial recognition.
To measure the expected credit losses, trade receivables
have been grouped based on shared credit risk
characteristics and the days past due. The expected
loss rates are based on average of historical loss rate
adjusted to reflect current and available forward looking
information affecting the ability of the customers to settle
the receivables.
B. Other Financial Assets
A financial asset is written off when there is no reasonable
expectation of recovering the contractual cash flows.
The gross carrying amount of a financial asset is written
off (either partially or in full) to the extent that there is no
realistic prospect of recovery. This is generally the case
when the Company determines that the debtor does not
have assets or sources of income that could generate
sufficient cash flows to repay the amounts subject to the
write - off. However, financial assets that are written off
could still be subject to enforcement activities under the
Company's recovery procedures, taking into account
legal advice where appropriate. Any recoveries made are
recognised in profit or loss
g. Cash and cash equivalents
Cash and cash equivalents includes cash on hand and
balance with bank in current accounts, demand deposits
with banks, other short-term highly liquid investments
with original maturities of three months or less that are
readily convertible to known amounts of cash and which
are subject to an insignificant risk of changes in value.
For the purpose of the statement of cash flows, cash and
cash equivalents and short-term deposits are considered
integral part of the Company's cash management.
h. Bank balances other than cash and cash equivalents
Bank balances other than cash and cash equivalents
includes fixed deposits with banks with original maturities
of twelve months or less.
i. Provisions, contingent liabilities and contingent assets
A provision is recognised when the Company has a present
obligation as a result of a past event and it is probable that
an outflow of embodying economic benefits will be required
to settle the obligation and there is a reliable estimate of
the amount of the obligation. Provisions are measured at
the best estimate of the expenditure required to settle the
present obligation at the Balance sheet date. Provisions are
determined by discounting the expected future cash flows
(representing the best estimate of the expenditure required
to settle the present obligation at the balance sheet date) at
a pre-tax rate that reflects current market assessments of
the time value of money and the risks specific to the liability.
Provisions are reviewed at each balance sheet date and
adjusted to effect current management estimates.
Contingent liabilities are not recognised but are disclosed in
the notes forming part of standalone financial statements. A
Contingent liability is a possible obligation arising from past
events, the existence of which will be confirmed only by
the occurence or non-occurence of one or more uncertain
future events not wholly within the control of the Company
or a present obligation that arises from past events but is
not recognised because it is not probable that an outflow of
resources embodying economic benefits will be required to
settle the obligation; or the amount of the obligation cannot
be measured with sufficient reliability. Contingent assets
are neither recognised nor disclosed in the standalone
financial statements.
j. Borrowing costs
Expenses related to borrowing cost are accounted using
effective interest rate. Borrowing costs are interest and
other costs (including exchange differences relating to
foreign currency borrowings to the extent that they are
regarded as an adjustment to interest costs) incurred
in connection with the borrowing of funds. Borrowing
costs directly attributable to acquisition or construction
of an asset which necessarily take a substantial period of
time to get ready for their intended use are capitalised as
part of the cost of that asset. Other borrowing costs are
recognised as an expense in the period in which they are
incurred. The difference between the discounted amount
mobilised and redemption value of commercial papers is
recognised in the statement of profit and loss over the life
of the instrument using the EIR.
k. Leases
The determination of whether an arrangement is a lease,
or contains a lease, is based on the substance of the
arrangement and requires an assessment of whether the
fulfilment of the arrangement is dependent on the use of
a specific asset or assets or whether the arrangement
conveys a right to use the asset. The Company assesses
whether a contract contains a lease, at inception of a
contract. 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. To assess
whether a contract conveys the right to control the use
of an identified assets, the Company assess whether (i)
the contract involves the use of an identified assets; (ii) the
Company has substantially all the economic benefits from
use of the assets through the period of the lease and (iii)
the Company has the right to direct the use of the asset.
At the date of commencement of the lease, the Company
recognises a right-of-use assets (ROU) and a corresponding
lease liability for all lease arrangements in which it is a
lessee, except for leases with a term of 12 month or less
(short-term leases) and low value leases. For these short¬
term and low value leases, the Company recognises the
lease payments as an operating expense on a straight-line
basis over the term of the lease.
Certain lease arrangements includes the options to extend
or terminate the lease before the end of the lease term.
ROU assets and lease liabilities includes these options
when it is reasonably certain that they will be exercised.
The cost of the right-of-use assets comprises the amount
of the initial measurement of the lease liability, any lease
payments made at or before the inception date of the lease,
less any lease incentives received. Subsequently, the right-
of-use assets is measured at cost less any accumulated
depreciation and accumulated impairment losses, if any.
The right-of-use assets is depreciated using the straight
line method from the commencement date over the shorter
of lease term or useful life of right-of-use assets.
For lease liabilities at inception, the Company measures the
lease liability at the present value of the lease payments
that are not paid at that date. The lease payments are
discounted using the interest rate implicit in the lease, if
that rate is readily determined. If that rate is not readily
determined the lease payments are discounted using the
incremental borrowing rate.
Lease liabilities and ROU asset has been separately
presented in the Balance Sheet and lease payments have
been classified as financing activities in statement of
cash flows.
l. Revenue from contracts with customers
Revenue is measured at transaction price (net of variable
consideration, if any). Revenue from contracts with
customers is recognised when control of the goods or
services are transferred to the customer at an amount that
reflects the consideration to which the Company expects to
be entitled in exchange for those goods or services.
The Company recognises revenue from the
following sources:
(a) Income from tech platform services, support services
and fees and commission income is recognised upon
completion of services, in accordance with the terms
of contract which is satisfied at a point in time.
(b) The Company has the right to consideration which is
unconditional but an invoice for the same has not been
raised accordingly it is classified as unbilled revenue
under trade receivable
Advances received from customers in respect of contracts
are treated as liabilities and adjusted against billing as per
terms of the contract.
m. Other income
(a) Interest income on a financial asset carried at amortised
cost is recognised on a time proportion basis taking into
account the amount outstanding and the effective interest
rate ('EIR'). The EIR is the rate that exactly discounts
estimated future cash flows of the financial assets
through the expected life of the financial asset or, where
appropriate, a shorter period, to the net carrying amount
of the financial instrument. The internal rate of return on
financial assets after netting off the fees received and cost
incurred approximates the effective interest rate method
of return for the financial asset. The future cash flows are
estimated taking into account all the contractual terms of
the instrument.
The interest income is calculated by applying the EIR to
the gross carrying amount of non-credit impaired financial
assets (i.e. at the amortised cost of the financial asset
before adjusting for any expected credit loss allowance).
For credit-impaired financial assets the interest income
is calculated by applying the EIR to the amortised cost of
the credit-impaired financial assets (i.e. the gross carrying
amount less the allowance for ECLs).
(b) Financial assets at fair value through profit and loss are
measured at fair value at the end of each reporting period,
with any gains or losses arising on re-measurement
recognised in the standalone statement of profit and loss.
n. Foreign exchange transactions
Transactions in foreign currencies are recorded at the
rate of exchange prevailing on the date of the transaction.
Exchange differences arising on settlement of revenue
transactions are recognised in the statement of profit and
loss. Monetary assets and liabilities contracted in foreign
currencies are restated at the rate of exchange ruling at
the Balance Sheet date. Non-monetary assets and liabilities
that are measured at fair value in a foreign currency are
translated into the functional currency at the exchange rate
when the fair value was determined. Non-monetary assets
and liabilities that are measured based on historical cost in a
foreign currency are translated at the exchange rate at the
date of the transaction.
0. Employee Benefits
1. Short-term employee benefits
Short-term employee benefits include salaries and short¬
term bonus. A liability is recognised if the Company has a
present legal or constructive obligation to pay this amount
as a result of past service provided by the employee, and
the obligation can be estimated reliably. These costs are
recognised as an expense in the Statement of Profit and
Loss at the undiscounted amount expected to be paid
over the period of services rendered by the employees to
the Company.
ii. Gratuity
The Company provides for gratuity for employees in India
as per the Code on Social Security 2020. Employees who
are in continuous service for a period of 5 years and fixed
term employees who has rendered service under the
contract for the period of 1 year are eligible for gratuity.
The amount of gratuity payable on retirement/termination
is the employees last drawn wage per month computed
proportionately for 15 days salary multiplied for the number
of years of service.
The Company's gratuity scheme is a defined benefit plan.
The Company's net obligation in respect of the gratuity
benefit scheme is calculated by estimating the amount of
future benefit that the employees have earned in return for
their service in the current and prior period. Such benefit is
discounted to determine its present value, and the fair value
of any plan assets, if any, is deducted.
The present value of the obligation under such benefit
plan is determined based on actuarial valuation using the
Projected Unit Credit Method which recognises each period
of services as giving rise to additional unit of employee
benefit entitlement and measures each unit separately to
build up the final obligation.
The obligation is measured at present values of estimated
future cash flows. The discounted rates used for determining
the present value are based on the market yields on
Government Securities as at the balance sheet date.
Remeasurement gains and losses arising from experience
adjustments and changes in actuarial assumptions are
recognised in the period in which they occur, directly in
other comprehensive income. They are included in retained
earnings in the statement of changes in equity and in the
balance sheet.
iii. Provident fund
The contribution to provident fund is considered as defined
contribution plan. The Company has no obligation, other
than the contribution payable to the provident fund. The
Company recognises contribution payable to the provident
fund scheme as an expense, when an employee renders
the related service.
iv. Share based payment arrangements
The grant date fair value of equity-settled share-based
payment arrangements granted to employees is measured
by reference to the fair value of the options using option
pricing model at the date on which the options are granted
and generally recognised as an employee benefits expense,
with a corresponding increase in equity, over the vesting
period of the awards. The amount recognised as an
expense is adjusted to reflect the number of awards for
which the related service conditions are expected to be
met, such that the amount ultimately recognised is based
on the number of awards that meet the related service
conditions at the vesting date.
v. Long term employee benefits
The long term employee benefits is measured by
reference to the fair value of the benefits using generally
accepted valuation methodologies which takes into
account performance based conditions subject to
continuous service.
p. Treasury shares
The Company has created a Groww Employee Welfare
Trust ("ESOP trust"). The Company uses Groww Employee
Welfare Trust as a vehicle for distributing shares to
employees under the employee stock option schemes.
The Company treats the ESOP trust as its extension and
shares held by the ESOP trust are treated as treasury
shares. Own equity instruments that are held by the trust
are recognized at cost and deducted from equity. No gain
or loss is recognized in profit or loss on the purchase,
sale, issue or cancellation of the Company's own equity
instruments. Any difference between the carrying amount
and the consideration, if reissued, is recognized in the
other equity.
q. Share issue expenses
Incremental costs directly attributable to the issue of equity
shares will be adjusted with securities premium.
r. Income Tax
Income tax expense comprises current and deferred tax. It
is recognised in statement of profit and loss except to the
extent that it relates to items recognised directly in equity
or in OCI.
(i) Current Tax
Current tax is measured at the amount expected to be
paid in respect of taxable income using tax rates enacted
or substantively enacted at the reporting date. Current tax
comprises the expected tax payable on the taxable income
or loss for the year and any adjustment to the tax payable
in respect of previous years.
Current income tax relating to items recognised outside
profit or loss is recognised outside profit or loss (either
in other comprehensive income or in equity). Current
tax items are recognised in correlation to the underlying
transaction either in OCI or directly in equity. Management
periodically evaluates positions taken in the tax returns with
respect to situations in which applicable tax regulations
are subject to interpretation and establishes provisions
where appropriate.
Current tax assets and current tax liabilities are offset only
if the Company has a legally enforceable right to set off the
recognised amounts, and it intends to realise the asset and
settle the liability on a net basis or simultaneously.
(ii) Deferred Tax
Deferred tax is recognised in respect on temporary
differences arising between the tax bases of assets
and liabilities and their carrying amounts in the
financial statements.
Deferred tax assets arising mainly on account of carry
forward losses and unabsorbed depreciation under tax
laws are recognised only if there is reasonable certainty of
its realisation, supported by convincing evidence.
Deferred tax assets on account of other temporary
differences are recognised only to the extent that there is
reasonable certainty that sufficient future taxable income
will be available against which such deferred tax assets can
be realised.
Deferred tax assets and liabilities are measured using tax
rates and tax laws that have been enacted or substantively
enacted at the Balance Sheet date. Changes in deferred
tax assets / liabilities on account of changes in enacted
tax rates are given effect to in the standalone statement
of profit and loss in the period of the change. The carrying
amount of deferred tax assets are reviewed at each Balance
Sheet date.
Deferred tax assets and deferred tax liabilities are off set
when there is a legally enforceable right to set-off assets
against liabilities representing current tax and where the
deferred tax assets and deferred tax liabilities relate to taxes
on income levied by the same governing taxation laws.
(iii) Uncertain income tax treatments
The determination of the Company's income tax expense
and credit involves significant judgment in respect of
uncertain income tax treatments. The Company evaluates
its tax positions at each reporting date in accordance
with Ind AS 12 - Income Taxes, including the guidance on
uncertainty over income tax treatments.
The Company considers whether it is probable that a
taxation authority will accept an uncertain tax treatment.
Where it is not probable, the Company reflects the effect
of the uncertainty in determining taxable profits, tax
bases, unused tax losses and taxes recoverable/assets
using either the most likely amount or the expected value,
depending on which method better predicts the resolution
of the uncertainty.
Interest and penalties (if any) related to income tax matters
are recognized as a component of income tax expense.
s. Earnings per share
The Company reports basic and diluted earnings per equity
share. Basic earnings per equity share have been computed
by dividing net profit attributable to the equity share holders
for the year by the weighted average number of equity
shares outstanding during the year. Diluted earnings per
equity share have been computed by dividing the net
profit attributable to the equity share holders after giving
impact of dilutive potential equity shares for the year by
the weighted average number of equity shares and dilutive
potential equity shares outstanding during the year, except
where the results are anti-dilutive.
t. Segment reporting
The company prepares the consolidated financial
statements. In accordance with Ind AS 108 on operating
segments, the Company has not disclosed the segments
information in the standalone financial statements.
u. Cash flow statement
Cash flows are reported using the indirect method, whereby
profit before tax is adjusted for the effects of transactions
of a non-cash nature and any deferrals or accruals of
past or future cash receipts or payments. The cash flows
from regular revenue generating, investing and financing
activities of the Company are segregated.
v. Business combinations
"Business combinations are accounted for by applying the
acquisition method as at the date of acquisition, which is
the date on which control is transferred to the Company.
Identifiable assets acquired and liabilities assumed in
a business combination are measured initially at their
fair values at the acquisition date. When the Company
acquires a business, it assess the financial assets and
liabilities assumed for appropriate classification and
designation. In accordance with contractual terms,
economic circumstances, and pertinent conditions as at
acquisition date. The excess of the cost of acquisition over
the interest in the fair value of the identifiable net assets
acquired and attributable to the owners of the Company
is recorded as goodwill. The cost of an acquisition
is measured as the aggregate of the consideration
transferred, which is measured at the acquisition date fair
value and the amount of a non-controlling interest in the
acquire. Transaction costs incurred in connection with a
business acquisition are expensed as and when incurred.
Any contingent consideration payable is measured at
fair value at the acquisition date. Subsequent changes in
the fair value of contingent consideration are recognised
in Standalone Statement of Profit and Loss. Contingent
consideration that is classified as equity is not remeasured
and subsequent settlement is accounted for within equity.
Business combinations involving entities or businesses
under common control shall be accounted for using the
pooling of interest method
If a business combination is achieved in stages, any
previously held equity interest in the acquiree is re-measured
at its acquisition date fair value and any resulting gain or loss
is recognised in profit or loss or OCI, as appropriate.
Goodwill is tested for impairment annually or when events
or circumstances indicate that the implied fair value is less
than its carrying amount.
w. Use of estimates and judgements
The preparation of financial statements in conformity with
Ind AS requires that the management make estimates
and assumptions that affect the application of accounting
policies and the reported amounts of assets and liabilities,
income and expenses. Actual results could differ from
those estimates. Estimates and underlying assumptions are
reviewed on an ongoing basis. Any revision to accounting
estimates is recognized prospectively in current and future
years. In particular, information about areas of significant
estimation uncertainty and critical judgements in applying
accounting policies that have a significant effect on
the amounts recognized in the financial statements are
included below:
(i) Depreciation and amortization
Depreciation and amortisation is based on management
estimates of the future useful lives of the property, plant
and equipment and intangible assets. Estimates may
change due to technological developments, competition,
changes in market conditions and other factors and may
result in changes in the estimated useful life and in the
depreciation and amortisation charges.
(ii) Recognition and measurement of defined benefit
obligations
The obligation arising from defined benefit plan is
determined on the basis of actuarial assumptions. Key
actuarial assumptions include discount rate, trends in
salary escalation, actuarial rates and life expectancy. The
discount rate is determined by reference to market yields
at the end of the reporting period on government bonds.
The period to maturity of the underlying bonds correspond
to the probable maturity of the post-employment benefit
obligations. Due to complexities involved in the valuation
and its long term nature, defined benefit obligation is
sensitive to changes in these assumptions.
(iii) Fair value of financial instruments
Financial instruments are required to be fair valued as at
the balance sheet date as provided in Ind AS 109 and Ind
AS 113. Being a critical estimate, judgement is exercised
to determine the carrying values. The fair value of financial
instruments that are unlisted and not traded in an active
market is determined at fair values assessed based on
recent transactions entered into with third parties, based
on valuation done by external appraisers etc., as applicable.
(iv) Expected credit losses on financial assets
The Company recognizes loss allowances for expected
credit losses on its financial assets measured at amortized
cost. At each reporting date, the Company assesses
whether financial assets carried at amortized cost are
credit- impaired. A financial asset is 'credit impaired'
when one or more events that have a detrimental impact
on the estimated future cash flows of the financial asset
have occurred.
(v) Taxes
Deferred tax assets and liabilities are recognized for the
future tax consequences of temporary differences between
the carrying values of assets and liabilities and their
respective tax bases. Deferred tax assets are recognized
to the extent that it is probable that future taxable income
will be available against which the deductible temporary
differences could be utilized. Further details are disclosed
in Note 24.
In assessing uncertain income tax treatments, management
applies judgment in determining the probability of
acceptance of tax positions by the relevant tax authorities
and in estimating the amounts expected to be paid.
(vi) Uncertain income tax treatments
In assessing uncertain income tax treatments, management
applies judgment in determining the probability of
acceptance of tax positions by the relevant tax authorities
and in estimating the amounts expected to be paid.
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