2. MATERIAL ACCOUNITNG POLICIES

(a). Revenue Recognition

The Company earns revenue primarily by providing healthcare services and sale of
pharmaceutical products.

Revenue is recognised upon transfer of control of promised products or services to
customers in an amount that reflects the consideration which the Company expects
to receive in exchange for those products or services. When there is uncertainty on
ultimate collectability, revenue recognition is postponed until such uncertainty is resolved.

a. Healthcare Service: Revenue primarily comprises fees charged for inpatient and
outpatient hospital services. Services include charges for accommodation, theatre, medical
professional services, equipment, radiology, laboratory and pharmaceutical goods used.The
performance obligations for this stream of revenue include accommodation, surgery,
medical/clinical professional services, supply of equipment, and supply of pharmaceutical
and related products. The patient is obligated to pay for healthcare services at
amounts estimated to be receivable based upon the Company's standard rates or at rates
determined under reimbursement arrangements. The reimbursement arrangements are
generally withthird party administrators.

Revenue is recognised at the transaction price when each performance obligation is
satisfied at a point in time when inpatient/ outpatients has actually received the
service except for few specific services where the performance obligation is satisfied over a
period of time. Revenue from health care patients, third party payers and other
customers are billed at our standard rates net of contractual or discretionary
allowances, discounts or rebates to reflect the estimated amounts to be receivable
from these payers.

b. Pharmacy Sales: Pharmacy Sales where the performance obligation is satisfied at a
point in time, revenue is recognised when the control of goods is transferred to the
customer.

Interest income from a financial asset is recognised when it is probable that the
economic benefits will flow to the Company and the amount of income can be
measured reliably. Interest income is accrued on a time basis, by reference to the
principal outstanding and at the effective interest rate applicable, which is the rate that
exactly discounts estimated future cash receipts through the expected life of the
financial asset to that asset's net carrying amount on initial recognition. Revenue is
measured based on the transaction price, which is the fixed consideration adjusted for
discounts, estimated disallowances, amounts payable to customer in the nature of
commissions, principal versus agent considerations, loyalty credits and any other rights
and obligations as specified in the contract with the customer. Revenue al so excludes
taxes collected from customers and deposited back to the respective statutory
authorities.

(b). Property, Plant and Equipment

Property, plant and equipment is stated at cost, net of accumulated depreciation and
accumulated impairment losses, if any. These tangible assets are held for use in
production,supply of goods or services or for administrative purposes.

Cost comprises purchase cost (net of tax credits, wherever applicable) freight, duties
and other expenses directly incidental to acquisition, bringing the asset to the location
and installation including site restoration up to the time when the asset is ready for intended
use. Such costs also include borrowing cost if the recognition criteria are met.

Freehold land is not depreciated. Expenditure incurred after the property, plant and
equipment have been put into operation are normally charged to the statements of
profit and loss in the period in which the costs are incurred. Major inspection, repairs and
overhaul expenditure is capitalized if the recognition criteria are met. 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
netwithin other income in statement of profit and loss.

Depreciation: Depreciation on Property, Plant and Equipment is provided for on straight-
line-basis, over the useful life of the asset as provided by the Schedule II of the
Companies Act, 2013 or the rates derived based on the economic useful life of the asset
as technically ascertained by the management at the end of each financial year.

(c) . Capital Work - in- Progress

Amounts paid towards the acquisition of property, plant and equipment outstanding as
of each reporting date are recognized as capital advance and the cost of property, plant
and equipment not ready for intended use before such date are disclosed under capital
work- in-progress.

Commencement of Depreciation related to property, plant and equipment classified as
Capital work in progress (CWIP) involves determining when the assets are available for their
intended use. The criteria the company uses to determine whether CWIP are available
for their intended use involves subjective judgments and assumptions about the
conditions necessary for the assets to be capable of operating in the intended manner.

(d) . Leased Assets

Leases are classified as finance leases whenever the terms of the lease transfer
substantially all the risks and rewards of ownership to the lessee. All other leases are
classified as operating leases.

The lease liability is initially measured at the present value of the lease payments that are
not paid at the commencement date, discounted by using the rate implicit in the lease.
If this rate cannot be readily determined, the Company uses its incremental borrowing
rate.

Rental income from operating leases is generally recognised on a straight-line basis over the
term of the relevant lease. Where the rentals are structured solely to increase in line
with expected general inflation to compensate for the Company's expected inflationary
cost increases, such increases are recognised in the year in which such benefits accrue.

Initial direct costs incurred in negotiating and arranging an operating lease are added to
the carrying amount of the leased asset and recognised on a straight-line basis over the
lease term.

(e) . Borrowing Cost

Borrowings and Borrowing costs

Borrowings are recognised initially at fair value, net of transaction costs incurred.
Borrowings are subsequently stated at amortised cost. Any difference between the proceeds
(net of transaction costs) and the redemption value is recognised in the statement of
profit and loss over the period of the borrowings using the effective interest rate
method. Borrowings are classified as current liabilities unless the Company has an
unconditional right to defer settlement of the liability for at least 12 months after the
reporting date.

Borrowing costs directly attributable to the acquisition, construction or production of
qualifying assets, which are assets that necessarily take a substantial period of time to
get ready for their intended use, are added to the cost of those assets, until such time
as the assets are substantially ready for their intended use.

Interest income earned on the temporary investment of specific borrowings pending
their expenditure on qualifying assets is deducted from the borrowing costs eligible for
capitalisation.

All other borrowing costs are recognised in statement of profit and loss in the period in
which they are incurred.

(f) . Inventories

Inventories of medical consumables, drugs and General stores are valued at cost or lower
of net realizable value. Net Realizable Value represents the estimated selling price in the
ordinary course of business less estimated costs necessary to make the sale. The cost of
inventories shall be assigned by using the first-in, first-out (FIFO) formula.