NOTE '1': COMPANY OVERVIEW
Continental Petroleum's Limited is a listed public limited Company incorporated on 22/07/1986, having registered office at A -
2, Opp. Udyog Bhawan, Tilak Marg, C- Scheme, Jaipur- 302005. It's Corporate Identification Number is (CIN)
L23201RJ1986PLC003704). The Company is engaged in production of liquid or gaseous fuels, illuminating oils, lubricating oil,
or Greases or other products from crude petroleum or bituminous minerals, and government order supplier and contractor
NOTE '2': BASIS OF PREPARATION AND SIGNIFICANT ACCOUNTING POLICIES:
2.1 Statement of Compliance
In accordance with the notification issued by the Ministry of Corporate Affairs, the Company has adopted Indian Accounting
Standards
Notified under the Companies (Indian Accounting Statndards) Rules, 2015 with effect from April 01, 2017. These financial
statements comprising of Balance Sheet, Statement of Profit and Loss (including Other Comprehensive Income), Statement of
Cash Flows and Statement of Changes in Equity for the year ended March 31, 2025 have been prepared in accordance with
Indian Accounting Standards ("Ind AS") as prescribed under Section 133 of the Companies Act, 2013 ("the Act") read with Rule
3 of the Companies (Indian Accounting Standards) Rules, 2015 and Companies (Indian Accounting Standards) Amendment
Rules, 2020.
2.2 Basis of Preparation of Accounts
The financial statements are prepared on going concern, accrual and historical cost basis except certain financial assets and
liabilities which have been measured at fair value.
The Company has adopted all the Ind AS and that was carried out in accordance with Ind AS 101 "First time adoption of Indian
Accounting Standards". The transition was carried out from Accounting Principles generally accepted in India as prescribed
under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014, which was the previous GAAP.
Reconciliations and descriptions of the effect of the transition have been summarized in Note 23 (12) (ii) and 23 (12) (iii).
Accounting policies have been consistently applied except where a 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 financial statements for the year ended March 31, 2025 were approved by the Board of Directors and authorize for issue
on May 20, 2025.
2.3 Functional and Presentation Currency
The financial statements are prepared in Indian Rupees ("INR") which is the Company's presentation currency and the
functional currency for all its operations. All financial information presented in INR has been rounded to the nearest Lakh with
two decimal places unless stated otherwise.
2.4 Use of Estimates
The preparation of the financial statements in conformity with Ind AS requires management to make estimates, judgments and
assumptions. These estimates, judgments and assumptions affect the application of accounting policies and the reported
amounts of assets and liabilities, the disclosures of contingent assets and liabilities at the date of the financial statements and
reported amounts of revenues and expenses during the period.
The Company based its assumptions and estimates or parameters available when the financial statements were prepared.
Existing circumstances and assumptions about future developments, however, may change due to market changes or
circumstances arising that are beyond the control of the Company. Such changes are reflected in the assumptions when they
occur.
Property, Plant & Equipment and Intangible Assets
Property, plant and equipment represent a significant proportion of the asset base of the Company. The charge in respect of
periodic depreciation is derived after determining an estimate of an asset's expected useful life and the expected residual value
at the end of its life. The useful lives and residual values of Company's assets are determined by management at the time the
asset is acquired and reviewed periodically, including at each financial year end. The lives are based on historical experience
with similar assets as well as anticipation of future events, which may impact their life, such as changes in technology.
2.5 Classification of Assets and Liabilities as Current and Non-Current
All Assets and Liabilities have been classified as current or non-current as per the Company's normal operating cycle and other
criteria set out in the Schedule III to the Companies Act, 2013. Based on the nature of product & activities of the Company and
their realization in cash and cash equivalent, the Company has determined its operating cycle as 12 months for the purpose of
current and non-current classification of assets and liabilities. Deferred tax assets and liabilities are classified as non-current
assets and liabilities.
2.6 Revenue Recognition
Revenue is recognized to the extent that it is probable that the economic benefits will flow to the Company and the revenue
can be reliably measured, regardless of when the payment is being made
Sale of Goods
Revenue from the sale of goods is recognized, when all the significant risks and rewards of ownership of the goods have passed
to the buyer, the Company no longer has effective control over the goods sold, the amount of revenue and costs associated
with the transaction can be measured reliably and no significant uncertainty exists regarding the amount of consideration that
will be derived from the sales of goods. Revenue from the sale of goods is measured at the fair value of the consideration
received or receivable, net of returns and allowances, trade discounts and volume rebates.
2.7 Inventory
Inventories are valued at the lower of cost and net realizable value. Cost includes cost of purchase and other costs incurred in
bringing the inventories to their present location and condition. Cost is determined on weighted average basis. 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.
2.8 Property, Plant & Equipment
Property, Plant and equipment are stated at cost, net of accumulated depreciation and accumulated impairment losses, if any.
Such cost includes the cost of replacing part of the plant and equipment and borrowing costs for long-term construction
projects if the recognition criteria are met. When significant parts of plant and equipment are required to be replaced at
intervals, the Company depreciates them separately based on their specific useful lives. Subsequent expenditures relating to
property, plant and equipment is capitalized only when it is probable that future economic benefits associated with these will
flow to the Company and the costs to the item can be measured reliably. Repairs and maintenance costs are recognized in the
statement of profit and loss when incurred.
The present value of the expected cost for the decommissioning of an asset after its use is included in the cost of the respective
asset only if the recognition criteria for a provision are met and amount is considered material. Capital work-in-progress
includes cost of property, plant and equipment under installation / under development as at the balance sheet date.
Depreciation
Depreciation is calculated on Straight Line basis over the useful lives of the assets as prescribed in Schedule II of the Companies
Act, 2013.
The residual values, useful lives and methods of depreciation of property, plant and equipment are reviewed at each financial
year end and adjusted prospectively, if appropriate.
2.9 Intangible Assets
Intangible assets are stated at cost less accumulated amortization and impairment. Intangible assets are amortized over their
respective individual estimated useful lives on a straight-line basis, from the date that they are available for use. Amortization
methods and useful lives are reviewed periodically including at each financial year end.
Research and Development Costs
Research costs are expensed as incurred. Development expenditures are recognized as an intangible asset when they meet
necessary recognition criteria.
2.10 Leases
A lease is classified at the inception date as a finance lease or an operating lease. A lease that transfers substantially all the
risks and rewards incidental to ownership to the Company is classified as a finance lease.
Lease arrangements where the risks and rewards incidental to ownership of an asset substantially vest with the lessor, are
recognized as operating lease. Operating lease payments are recognized as an expense in the statement of profit and loss on a
straight-line basis over the lease term, unless the lease agreement explicitly states that increase is on account of inflation.
2.11 Impairment of Assets
Non-Financial asset
Property, plant and equipment and intangible assets with finite life are evaluated for recoverability whenever there is any
indication that their carrying amounts may not be recoverable. If any such indication exists, the recoverable amount (i.e. higher
of the fair value less cost to sell and the value-in-use) is determined on an individual asset basis unless the asset does not
generate cash flows that are largely independent of those from other assets. In such cases, the recoverable amount is
determined for the cash generating unit (CGU) to which the asset belongs.
If the recoverable amount of an asset (or CGU) is estimated to be less than its carrying amount, the carrying amount of the
asset (or CGU) is reduced to its recoverable amount. An impairment loss is recognized in the statement of profit and loss.
Financial Assets
The Company assesses at each date of balance sheet whether a financial asset or a group of financial assets is impaired. Ind AS
109 requires expected credit losses to be measured through a loss allowance. The Company recognizes lifetime expected losses
for all contract assets and / or all trade receivables that do not constitute a financing transaction. For all other financial assets,
expected credit losses are measured at an amount equal to the 12 month expected credit losses or at an amount equal to the
life time expected credit losses if the credit risk on the financial asset has increased significantly since initial recognition.
2.12 Financial Assets & Liabilities
Financial Instruments
a) Initial Recognition
The Company recognizes financial assets and financial liabilities when it becomes a party to the contractual provisions of the
instrument. 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 that 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.
b) Subsequent Measurement
(i) Financial assets carried at amortized cost
A financial asset is subsequently measured at amortized cost if it is held within a business model whose objective is to hold the
asset in order 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 on the principal amount outstanding.
(ii) Financial assets at fair value through other comprehensive income
A financial asset is subsequently measured at fair value through other comprehensive income if it is held within a business
model whose objective is achieved by both collecting contractual cash flows and selling financial assets and the contractual
terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the
principal amount outstanding.
(iii) Financial assets at fair value through profit or loss
A financial asset which is not classified in any of the above categories is subsequently fair valued through profit or loss.
(iv) Financial liabilities
Financial liabilities are subsequently carried at amortized cost using the effective interest rate method. For trade and other
payables maturing within one year from the balance sheet date, the carrying amounts approximate fair value due to the short
maturity of these instruments.
c) De-recognition
The Company derecognizes a financial asset when the contractual rights to the cash flows from the financial asset expire or it
transfers the financial asset and the transfer qualifies for de recognition under Ind AS 109. A financial liability (or a part of a
financial liability) is derecognized from the Company's balance sheet when the obligation specified in the contract is discharged
or cancelled or expires.
d) Offsetting of financial instruments
Financial assets and financial liabilities are offset and the net amount is reported in the balance sheet if there is a currently
enforceable legal right to offset the recognized amounts and there is an intention to settle on a net basis, to realize the assets
and settle the liabilities simultaneously.
2.13 Foreign Exchange Transactions/Translations
Financial statements are presented in INR, which is Company's functional currency. Monetary assets and liabilities
denominated in foreign currencies (except financial instruments designated as Hedge Instruments) are translated at the
functional currency spot rates of exchange at the reporting date.
Non-monetary items that are measured in terms of historical cost in a foreign currency are translated using the exchange rates
at the dates of the initial transactions. The gain or loss arising on translation of non-monetary items measured at fair value is
treated in line with the recognition of the gain or loss on the change in fair value of the item.
All exchange differences are included in profit or loss except any exchange differences on monetary items designated as an
effective hedging instrument of the currency risk of designated forecasted sales or purchases, which are recognized in the other
comprehensive income.
2.14 Employee Benefits
Short-term Employee Benefits are recognized as an expense on accrual basis. The Company does not have any liability towards
long-term employee benefits.
2.15 Taxation
Current income tax
Current income tax assets and liabilities are measured at the amount expected to be paid to or recovered from to the taxation
authorities in accordance with Income Tax Act 1961. The tax rates and tax laws used to compute the amount are those that are
enacted or substantively enacted, at the reporting date.
Current income tax relating to items recognized outside profit or loss is recognized either in other comprehensive income or in
equity.
Deferred Tax
Deferred income tax assets and liabilities are recognized for all temporary differences arising between the tax bases of assets
and liabilities and their carrying amounts in the financial statements. Deferred tax assets are reviewed at each reporting date
and are reduced to the extent that it is no longer probable that the related tax benefit will be realized.
Deferred income tax assets and liabilities are measured using tax rates and tax laws that have been enacted or substantively
enacted by the balance sheet date and are expected to apply to taxable income in the years in which those temporary
differences are expected to be recovered or settled. The effect of changes in tax rates on deferred income tax assets and
liabilities is recognized as income or expense in the period that includes the enactment or the substantive enactment date. A
deferred income tax asset is recognized to the extent that it is probable that future taxable profit will be available against which
the deductible temporary differences and tax losses can be utilized. The Company offsets current tax assets and current tax
liabilities, where it has a legally enforceable right to set off the recognized amounts and where it intends either to settle on a
net basis, or to realize the asset and settle the liability simultaneously.
|