3. SIGNIFICANT ACCOUNTING POLICIES
3.1 PROPERTY, PLANT AND EQUIPMENT
a) All categories of property, plant and equipment are initially recognised at cost. Cost includes expenditure directly attributable to the
acquisition of the assets. Computer software, including the operating system, that is an integral part of the related hardware is capital¬
ised as part of the computer equipment. Property, plant and equipment are subsequently carried at cost less accumulated depreciation
and accumulated impairment losses if any. When significant parts of property, plant and equipments are required to be replaced at
intervals, the company recognises the new part with its own associated useful life and it is depreciated accordingly.
b) Subsequent costs are included in the asset's carrying amount or recognised as a separate asset, as appropriate, only when it is prob¬
able that future economic benefits associated with the item will flow to the company and the cost of the item can be measured reliably.
Repairs and maintenance expenses are charged to the profit and loss account in the year in which they are incurred.
c) Cost of asset(s) replaced but still usable is not reduced from the cost of the asset(s) till it is sold / discarded. If the cost of the asset(s),
discarded / sold is not ascertainable, cost of replacement of such asset(s), (discounted as per “indexed cost formula” prescribed under
Income Tax Act, 1961) is taken as the cost of such asset(s) for the purpose of deduction from the cost.
d) Depreciation on tangible assets is provided on straight-line method over the useful life of assets in the manner and at the rate specified
in Part C of Schedule II of Companies Act, 2013 from the date the Schedule II came into effect. A residual value of 5% (as prescribed
in Schedule II of the Act) of the cost of the asset is used for the purpose of calculating the depreciation charge.
3.2 INTANGIBLE ASSETS
Accounting treatment of intangible assets is in accordance with IND AS-38. Intangible Assets are depreciated on straight line method
over the useful life thereof.
3.3 IMPAIRMENT OF NON FINANCIAL ASSETS
The carrying amounts of the asset(s) are reviewed at each balance sheet date to assess whether these were recorded at their recov¬
erable value, and, where carrying amounts exceed the recoverable value, the assets are written down to their recoverable value.
3.4 INVESTMENTS
Investment in subsidiary/associates is carried out at cost as per the Ind AS 27.
The cost comprises price paid to acquire investment and directly attributable cost.
Current investments are carried individually, at the lower of cost and fair value.
Cost of investments includes acquisition charges such as brokerage, fees and duties.
3.5 TRANSLATION OF FOREIGN CURRENCIES
a) On initial recognition, all transactions are recorded in the functional currency (the currency of the primary economic environment
in which the company operates), which is Indian Rupees (INR).
b) Transactions in foreign currencies during the year are converted into the functional currency using the exchange rate prevailing at
the transaction date. Monetary assets and liabilities at the balance sheet date denominated in foreign currencies are translated into
the functional currency using the exchange rate prevailing as at that date. The resulting foreign exchange gains and losses from
the settlement of such transactions and from year-end translation are recognised on a net basis in other items of comprehensive
income or the profit and loss account respectively in the year in which they arise.
3.6 FINANCIAL INSTRUMENTS
I) Financial Assets
i) Initial recognition and measurement
The Company recognizes financial assets and financial liabilities when it becomes a party to the contractual provisions of the instru¬
ment. All financial assets and liabilities are recognized at fair value on initial recognition, except for trade receivables which are initially
measured at transaction price. Transaction costs that are directly attributable to the acquisition or issue of financial assets and financial
liabilities, which are not at fair value through profit or loss, are added to the fair value on initial recognition. Regular way purchase and
sale of financial assets are accounted for at trade date.
ii) Subsequent measurement
Subsequent measurement of debt instruments depends on the Group's business model for managing the assets and the cash flow
characteristics of the asset.
3.7 ASSETS ON LEASE
Accounting treatment of assets taken on lease is in accordance with Ind AS - 17.
3.8 INVENTORIES
Inventories are valued at lower of cost and estimated net realizable value after providing cost of obsolescence and other anticipated
loss wherever considered necessary, if material. Cost is determined by using first in first out (FIFO) basis.
Linen, Glassware etc.: Items issued to rooms and outlets are treated as replacement of old/worn items and charged to profit and loss
account and items in use at the close of the year are included in inventories.
3.9 BORROWING COST
Borrowing cost that are attributable to the acquisition, construction or production of qualifying assets are capitalized as part of the cost
of such assets. A qualifying assets is an asset that necessarily requires a substantial period of time to get ready for its intended use or
sale. All other Borrowing cost are recognized as an expense in the period in which they are incurred.
3.10 RISK MANAGEMENT OBJECTIVE AND POLICIES
The company's overall risk management policies are set out by the board and implemented by the management, and focus on the un¬
predictability of changes in the business environment and seek to minimize the potential adverse effects of such risk on the company's
performance by setting acceptable levels of risk. The company does not hedge against any risks.
3.11 RECOGNITION OF REVENUES
i. Revenue comprises sale of rooms, food and beverages and allied services relating to hotel operations including net income from
Licence Fees from the Offices and Shops, Health Club, Business Centre etc. Revenue is recognized upon rendering of service
and is stated net of discounts/ allowances.
ii. Claims recoverable / payable are recognized to the extent admitted. Unclaimed credit balances and excess provision of
expenditure are treated as revenue of the year in which such amounts cease to be Company's liability.
iii. Discarded assets (carpets etc.) are charged to the profit & loss account at written down value. Amount realized, if any, on sale of
such items is treated as income. Scrap value is recognized, if material.
iv. For all debt instruments measured at amortised cost or at fair market value through Other Comprehensive Income(OCI) and profit
and loss account.
3.12 RETIREMENT AND OTHER EMPLOYEE BENEFITS
The company has classified various benefits to employees under “Defined Contribution Plan, and Defined Benefit Plan”.
i. Defined Contribution Plan
a) The Company recognizes contribution payable to the provident fund scheme as an expense, when an employee renders the
related service. Contributions payable by the company to the concern Government Authorities in respect to Provident Fund,
Family Pension Fund and Employees State Insurance are charged to the Profit and Loss Account on accrual basis.
ii. Defined Benefit Plan
a) Gratuity liability as on the Balance Sheet date is determined on the basis of actuarial valuation using projected unit credit method
(Ind AS 19). The gratuity liability amount is contributed to income tax approved insurance company with whom the Company is
maintaining gratuity fund account.
Short term compensated absences are recognized as expense, at the undiscounted amount, in Profit and Loss Account of the
year in which they are incurred.
Long term compensated absences are provided for based on the actuarial valuation as per projected unit credit method, as at
the Balance Sheet date.
Actuarial gains and losses are immediately taken to other comprehensive income as income or expenses without resorting to any
amortization.
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