2. Material Accounting Policies
A summary of basis of preparation and Material accounting policies adopted in the preparation of these financial statements are
as given below. These bases of preparation and accounting policies have been applied consistently to all periods presented in the
financial statements.
2.1 Statement of Compliance
These standalone financial statements have been prepared in accordance with the Indian Accounting Standards (referred
to as “Ind AS”) as prescribed under section 133 of the Companies Act, 2013 read with the Companies (Indian Accounting
Standards) Rules 2015 as amended from time to time and other accounting principles generally accepted in India.
2.2 Basis of preparation and presentation
The Financial Statements are prepared on the historical cost basis except for certain financial instruments that are measured
at fair values at the end of each reporting period, as explained in the accounting policies below.
Unless otherwise stated, all amounts are stated in Lakhs of Rupees.
Historical cost is generally based on the fair value of the consideration given in exchange for goods and services.
Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between
market participants at the measurement date. All assets and liabilities have been classified as current and non-current as per
the Company’s normal operating cycle. Based on the nature of services rendered to customers and time elapsed between
deployment of resources and the realisation in cash and cash equivalents of the consideration for such services rendered, the
Company has considered an operating cycle of 12 months.
In addition, for financial reporting purposes fair value measurements are categorised into Level 1, 2 or 3 based on the
degree to which the inputs for the fair value measurements are observable and the significance of the inputs to the fair value
measurements in its entirety, which are described as follows:
a) Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities.
b) Level 2 inputs are inputs that are observable, either directly or indirectly, other than quoted prices included within level 1
for the asset or liability.
c) Level 3 inputs are unobservable inputs for the asset or liability.
2.3 Use of Estimates
The preparation of financial statements requires management to make judgments, estimates and assumptions that may
impact the application of accounting policies and the reported value of assets, liabilities, income, expenses and related
disclosures concerning the items involved as well as contingent assets and liabilities at the balance sheet date. The estimates
and management’s judgments are based on previous experience & other factors considered reasonable and prudent in the
circumstances. Actual results may differ from these estimates.
Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognized
in the period in which the estimates are revised and in any future periods affected.
In order to enhance understanding of the financial statements, information about material areas of estimation, uncertainty and
critical judgments in applying accounting policies that have the most material effect on the amounts recognized in the financial
statements is as under:
1. Formulation of accounting policies
The accounting policies are formulated in a manner that results in financial statements containing relevant and reliable
information about the transactions, other events and conditions to which they apply. Those policies need not be applied
when the effect of applying them is immaterial.
2. Post-employment benefit plans
Employee benefit obligations are measured on the basis of actuarial assumptions which include mortality and withdrawal
rates as well as assumptions concerning future developments in discount rates, the rate of salary increases and the
inflation rate. The Company considers that the assumptions used to measure its obligations are appropriate and
documented. However, any changes in these assumptions may have a material impact on the resulting calculations.
3. Provisions and contingencies
The assessments undertaken in recognizing provisions and contingencies have been made in accordance with Ind AS
37 ‘Provisions, contingent liabilities and contingent assets’. The evaluation of the likelihood of the contingent events has
required best judgment by management regarding the probability of exposure to potential loss. Should circumstances
change following unforeseeable developments, this likelihood could alter.
4. Income taxes
Material estimates are involved in determining the provision for income taxes, including amount expected to be paid/
recovered for uncertain tax positions.
2.4 Revenue recognition
Revenue from contracts with customers is recognised when control of the goods or services are transferred to the customer
and complete satisfaction of all performance obligations. Revenue is measured at the amount of consideration which the
Company expects to be entitled to in exchange for transferring distinct goods or services to a customer as specified in the
contract, excluding amounts collected on behalf of third parties (for example taxes and duties collected on behalf of the
government). Consideration is generally due upon satisfaction of performance obligations and a receivable is recognised
when it becomes unconditional.
If at the time of rendering of services or sales there is material uncertainty in Ultimate collection of the revenue, then the revenue
recognition is postponed and in such Cases revenue is recognized only when it becomes reasonably certain that ultimate
collection will be made. When the uncertainty of collection of revenue arises subsequently after the revenue recognition,
provision for the uncertainty in the collection is made rather than adjustment in revenue already recognized. Dividend income
is recognized when right to receive is established. Interest Income is recognized on time proportion basis taking in to account
the amount outstanding and rate applicable based on effective interest method.
2.5 Property, Plant and Equipment (PPE)
Property, plant and equipment (PPE) are carried at cost less accumulated depreciation and impairment losses, if any.
The cost of Property, plant and equipment (PPE) comprises its purchase price net of any trade discounts and rebates, any
import duties and other taxes (other than those subsequently recoverable from the tax authorities), any directly attributable
expenditure on making the asset ready for its intended use, other incidental expenses, present value of decommissioning
costs (where there is a legal or constructive obligation to decommission) and interest on borrowings attributable to acquisition
of qualifying fixed assets up to the date the asset is ready for its intended use. Property, plant and equipment are tested for
impairment whenever events or changes in circumstances indicate that an asset may be impaired. If an impairment loss
is determined, the remaining useful life of the asset is also subject to adjustment. If the reasons for previously recognised
impairment losses no longer exist, such impairment losses are reversed and recognised in income. Such reversal shall
not cause the carrying amount to exceed the amount that would have resulted had no impairment taken place during the
preceding periods.
Depreciation
Depreciation is provided for Property, Plant and Equipment so as to expense the cost less residual values over their estimated
useful lives. The estimated useful lives, residual values and depreciation method are reviewed at the end of each reporting
period. Depreciation is calculated on a straight-line basis over the estimated useful lives of the assets as follows:
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.
Gains and losses arising from Derecognition of Property, Plant and Equipment are measured as the difference between the
net disposal proceeds and the carrying amount of the asset and are recognized in the Statement of Profit and Loss when the
asset is derecognised.
Amortization of Intangible assets
Intangible assets are amortized on a straight-line basis over the estimated useful economic life. The amortization period and
the amortization method are reviewed at each financial year end. If the expected useful life of the asset is significantly different
from the previous estimate, the amortization period is changed accordingly.
The useful lives of intangible assets are assessed as either definite or indefinite. Intangible assets are tested for impairment
at the end of each reporting period.
Softwares are amortised over the life of the software or 5 years, whichever is lower
2.6 Inventory
Inventory of newsprint, goods in transit are stated at cost or net realisable value, whichever is lower. Cost comprises all cost of
purchase, cost of conversion and other costs incurred in bringing the inventories to their present location and condition. Cost
formulae used are ‘First in First Out’, ‘Average cost’, or ‘Specific Identification’, as applicable. Due allowance is estimated and
made for defective and obsolete items, wherever necessary, based on the past experience of the Company.
2.7 Taxation
Income tax expense represents the sum of tax currently payable and deferred tax.
2.7.1 Current tax
The tax currently payable is based on taxable profit for the year. Taxable profit differs from ‘profit before tax’ as reported
in the statement of profit and loss because of items of income or expense that are taxable or deductible in other years
and items that are never taxable or deductible.
Current tax is determined on the basis of taxable income and tax credits computed for Company, in accordance with
the applicable tax rates and the provisions of applicable tax laws applicable to Company in the respective jurisdiction in
which it operates.
Advance taxes and provisions for current income taxes are presented in the Balance sheet after off-setting advance tax
paid and income tax provision arising in the same tax jurisdiction and where the relevant taxpaying units intends to settle
the asset and liability on a net basis.
2.7.2 Deferred Tax
Deferred tax assets and liabilities are measured using the enacted/substantively enacted tax rates and laws for continuing
operations. Deferred tax assets are recognized for all deductible temporary differences and unused tax losses only if it
is probable that future taxable amounts will be available to utilize those temporary differences and losses. The carrying
amount of deferred tax assets is reviewed at each balance sheet date to reassess realisation.
Current and deferred tax for the year
Current and deferred tax are recognised in profit or loss, except when they relate to items that are recognised in other
comprehensive income or directly in equity, in which case, the current and deferred tax are also recognised in other
comprehensive income or directly in equity respectively.
2.8 Employee Benefits
Defined contribution plan
A Defined contribution plan is a post-employment benefit plan under which the company pays fixed contributions in respect
of the employees into an independent fund administrated by the government/ pension fund manager and will have no legal
or constructive obligation to pay further amounts after its payment of the fixed contribution. Obligations for contributions to
defined contribution plans are recognized as an employee benefit expense in statement of profit and loss in the period during
which services are rendered by employees.
The company has a defined contribution plan which includes pension scheme and provident fund scheme. Company’s
contribution towards provident fund and pension scheme for the year are recognised as an expense and charged to the
statement of profit and loss.
Defined benefit plan
A defined benefit plan is a post-employment benefit plan other than a defined contribution plan. The company’s liability
towards gratuity and post-retirement benefits such as medical benefits are in the nature of defined benefits plans.
The company’s net obligation in respect of defined benefit plans is determined using the projected unit credit method, with
actuarial valuations being carried out at the end of reporting period. Actuarial gain/loss on re-measurement of gratuity and
other post-employment defined plans are recognised in other comprehensive income (OCI). Past service cost is recognised
in the statement of Profit and Loss account in the period of a plan amendment.
Other long-term employee benefits
The company’s obligation towards leave encashment is in the nature of other long term employee benefits. Liability in respect
of compensated absences becoming due or expected to be availed more than one year after the balance sheet date.
Actuarial gains and losses arising from past experience and changes in actuarial assumptions are charged to statement of
profit and loss in the period in which such gains or losses are determined.
Short-term employee benefits
Short term employee benefits such as salaries and wages are recognised on undiscounted basis in the statement of Profit and
Loss account, on the basis of the amount paid or payable for the period during which services are rendered by the employee.
|