2. Significant accounting policies:
This note provides a list of the significant accounting
policies adopted in the preparation of these financial
statements. These policies have been consistently
applied to all the years presented, unless otherwise
stated.
2.1 Basis of Preparation and Compliance:
a. Preparation of Financial statements:
The financial statements, for the financial year 31
March 2026 were prepared based on the accounting
standards under IND AS framework.
b. Statement of compliance:
The Financial Statements have been prepared and
presented in accordance with Indian Accounting
Standards ("Ind AS") notified under the Companies
(Indian Accounting Standards) Rules, 2015 and
relevant amendment rules issued thereafter and
presentation requirements of division II of schedule
III to the companies Act 2013, (Ind As compliant
schedule III).
c. Functional and presentation currency:
Items included in the financial statements of the
Company are measured using the currency of the
primary economic environment in which the entity
operates ("functional currency"). The financial
statements are presented in Indian Rupees (INR),
which is Company functional and presentation
currency.
d. Basis of measurement:
The financial statements have been prepared on a
historical cost convention and on accrual basis of
accounting except for (i) certain financial assets and
financial liabilities that are measured at fair values
at the end of each reporting period, (ii) Defined
benefit plans- plan assets measured at fair value as
stated in the accounting policies set out below. The
financial statements are prepared on a going
concern basis using the accrual concept except for
the cash flow information. The accounting policies
have been applied consistently over all the periods
presented in these financial statements. The said
accounts has been approved by the Board of
Directors at their meeting held on May 27, 2026.
Historical cost is generally based on 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, regardless of
whether that price is directly observable or
estimated using another valuation technique. In
estimating the fair value of an asset or a liability, the
Company takes into account the characteristics of
the assets or liability if market participants would
take those characteristics into the account when
pricing the asset or liability at the measurement
date.
e. Use of estimates, judgements and assumptions:
The preparation of financial statements in
conformity with Ind AS requires management to
make judgements, estimates and assumptions that
affect the application of accounting policies and the
reported amounts of assets, liabilities, income and
expenses. The actual results may differ from these
estimates. Estimates and underlying assumptions
are reviewed on a periodic basis. Revisions to
accounting estimates are recognized in the period in
which the estimates are revised and in any future
periods affected. Information about significant
areas of estimation, assumptions, uncertainty, and
critical judgements in applying accounting policies
that have the most significant effect on the amounts
recognized in the financial statements are included
in relevant notes.
f. Going Concern assumption:
The management has given the significant
uncertainties arising out of the various situations,
as explained in the note below, assessed the cash
flow projections (based on orders on hand and
business forecast) and available liquidity (credit
facilities sanctioned by bankers) for a period of at
least 12 months from the date of this financial
statements. Based on this evaluation,
management believes that the Company will be
able to continue as a going concern in the
foreseeable future from the date of these financial
statements. Accordingly, the financial statements
do not include any adjustments regarding the
recoverability and classification of the carrying
amount of assets and classification of liabilities
that might result, should the Company be unable to
continue as a going concern.
g. Current and Non-current classification of assets
and liabilities:
All assets and liabilities have been classified and
disclosed as current and non-current as per the
companies' normal operating cycle and other
criteria set out in Schedule -III to the Companies Act,
2013. Based on the nature of products and the time
between the acquisition of assets for processing
and their realization into cash and cash equivalents,
the Company has ascertained its operating cycle as
12 months for the purpose of classification of
assets and liabilities.
h. Reclassification:
No such material reclassification done during the
year.
i. Property, Plant and Equipment:
Recognition and measurement:
The Company has elected to continue with the
carrying value of Property, Plant and Equipment
('PPE') recognized as of transition date measured as
per the Previous GAAP and use that carrying value
as its deemed cost of the PPE as on the transition
date.
Property, plant and equipment are stated at
historical cost less accumulated depreciation and
accumulated impairment losses. Cost includes
purchase price (after deducting trade discount /
rebate), non-refundable import duties and taxes,
cost of replacing the component parts, borrowing
costs and other directly attributable cost to bringing
the asset to the location and condition necessary for
it to be capable of operating in the manner intended
by management.
Spare parts procured along with the Plant and
Equipment or subsequently which meets the
recognition criteria of PPE are capitalized and added
to the carrying amount of such items. The carrying
amount of those spare parts that are replaced are
derecognized when no future economic benefits are
expected from their use or upon disposal. If the cost
of the replaced part is not available, the estimated
cost of similar new parts is used as an indication of
what the cost of the existing part was when the item
was acquired.
An item of PPE is de recognized on disposal or when
no future economic benefits are expected from use.
Any profit or loss arising on the derecognition of an
item of property, plant and equipment is determined
as the difference between the net disposal proceeds
and the carrying amount of the asset and is
recognized in Statement of Profit and Loss.
Subsequent costs:
The cost of replacing a part of an item of property,
plant and equipment is recognized in the carrying
amount of the item if it is probable that the future
economic benefits embodied within the part will
flow to the Company and its cost can be measured
reliably. The carrying amount of the replaced part
is derecognized. The cost of the day-to-day
servicing the property, plant and equipment are
recognized in the statement of profit and loss as
incurred.
Disposal:
An item of property, plant and equipment is
derecognized upon the disposal or when no future
benefits are expected from its use or disposal. 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 recognised
net within other income / expenses in the statement
of profit and loss.
j. Depreciation:
Depreciation on Property, Plant & Equipment is
provided on written down value basis over the
estimated economic useful life of the assets as
prescribed in Schedule II of the Companies Act,
2013 or as determined based on a technical
evaluation by the Company periodically. The
depreciable amount of an asset is determined
after deducting its residual value. Where the
residual value of an asset increases to an amount
equal to or greater than the asset's carrying
amount, no depreciation charge is recognised till
the asset's residual value decreases below the
asset's carrying amount. Depreciation of an asset
begins when it is available for use, i.e., when it is
in the location and condition necessary for it to be
capable of operating in the intended manner.
Depreciation of an asset ceases at the earlier of
the date that the asset is classified as held for
sale in accordance with IND AS 105 and the date
that the asset is derecognized. Individual assets
costing Rs.5000 or less are depreciated in full, in
the year of purchase.
k. Impairment of assets:
Assets are tested for impairment whenever events
or changes in circumstances indicate that the
carrying amount may not be recoverable. An
impairment loss is recognized for the amount by
which the assets carrying amount exceeds its
recoverable amount. The recoverable amount is
the higher of an assets fair value less costs of
disposal and value in use. For the purposes of
assessing impairment, assets are grouped at the
lowest levels for which there are separately
identifiable cash inflows which are largely
independent of the cash inflows from other assets
(cash generating units). Non-financial assets other
than goodwill that suffered an impairment are
reviewed for possible reversal of the impairment at
the end of each reporting period.
l. Intangible Assets:
Recognition and measurement:
Intangible assets are recognised when the asset is
identifiable, is within the control of the Company, it
is probable that the future economic benefits that
are attributable to the asset will flow to the Company
and cost of the asset can be reliably measured.
Intangible assets acquired separately are measured
on initial recognition at cost. The cost of intangible
assets acquired in a business combination is their
fair value at the date of acquisition. Intangible
assets acquired by the Company that have finite
useful lives are measured at cost less accumulated
amortisation and any accumulated impairment
losses. Intangible assets with indefinite useful lives
are not amortised, but are tested for impairment
annually, either individually, either individually or at
the cash-generating unit level.
Expenditure on Research activities is recognised in
the statement of Profit and Loss as incurred.
Development expenditure is capitalised only if the
expenditure can be measured reliably, the product or
process is technically and commercially feasible,
future economic benefits are probable, and the
Company intends to complete development and to
use or sell the asset.
Intangible assets which comprise of the
development expenditure incurred on new product
and expenditure incurred on acquisition of user
licenses for computer software are recorded at their
acquisition price. Subscriptions to software are
treated as revenue expenses as the economic life of
such software does not exceed one year.
Subsequent measurement:
Subsequent expenditure is capitalised only when it
increases the future economic benefits embodied in
the specific asset to which it relates.
Amortisation:
Amortisation method, useful lives and residual
values are reviewed at the end of each financial year
and adjusted if appropriate. Intangible assets are
assessed for impairment whenever there is an
indication that the intangible asset may be impaired.
Disposal:
Gains or losses arising from derecognition of an
intangible asset are measured as the difference
between the net disposal proceeds and the carrying
amount of the asset and are recognised in the
statement of profit and loss when the asset is
derecognized.
m. Investments and other Financial Assets:
Fair Value Assessment:
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, regardless of whether that price
is directly observable or estimated using another
valuation technique. In estimating the fair value of
an asset or a liability, the Company takes into
account the characteristics of asset and liability if
market participants would take those into
consideration. Fair value for measurement and / or
disclosure purposes in these Financial Statements
is determined on such basis except for transactions
in the scope of Ind AS 2, 17 and 36. Normally at initial
recognition, the transaction price is the best
evidence of fair value.
The fair value of an asset or a liability is measured
using the assumptions that market participants
would use when pricing the asset or liability,
assuming that market participants act in their
economic best interest.
A fair value measurement of a non-financial asset
takes into account a market participant's ability to
generate economic benefits by using the asset in its
highest and best use or by selling it to another
market participant that would use the asset in its
highest and best use.
The Company uses valuation techniques those are
appropriate in the circumstances and for which
sufficient data are available to measure fair value,
maximizing the use of relevant observable inputs
and minimizing the use of unobservable inputs.
All financial assets and financial liabilities for which
fair value is measured or disclosed in the Financial
Statements are categorized within the fair value
hierarchy, described as follows, based on the lowest
level input that is significant to the fair value
measurement as a whole.
Subsequent Measurement:
For purposes of subsequent measurement financial
assets are classified in three categories:
• Financial assets measured at amortized cost
• Financial assets at fair value through OCI
• Financial assets at fair value through profit or
loss
Financial assets measured at amortized cost:
Financial assets are measured at amortized cost if
the financials asset is held within a business model
whose objective is to hold financial assets 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. These financials assets are amortized
using the effective interest rate ('EIR') method, less
impairment. Amortized cost is calculated by taking
into account any discount or premium on acquisition
and fees or costs that are an integral part of the EIR.
The EIR amortization is included in finance income
in the Statement of Profit and Loss. The losses
arising from impairment are recognized in the
Statement of Profit and Loss.
Financial assets at fair value through OCI
('FVTOCI'):
Financial assets are measured at fair value through
other comprehensive income if the financial asset 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. At initial recognition, an irrevocable
election is made (on an instrument-by-instrument
basis) to designate investments in equity
instruments other than held for trading purpose at
FVTOCI. Fair value changes are recognized in the
other comprehensive income ('OCI'). However, the
Company recognizes interest income, impairment
losses and reversals and foreign exchange gain or
loss in the Statement of Profit And Loss. On
derecognition of the financial asset other than
equity instruments designated as FVTOCI,
cumulative gain or loss previously recognised in OCI
is reclassified to the Statement of Profit and Loss.
Financial assets at fair value through profit or loss
('FVTPL'):
Any financial asset that does not meet the criteria
for classification as at amortized cost or as financial
assets at fair value through other comprehensive
income is classified as financial assets at fair value
through profit or loss. Further, financial assets at fair
value through profit or loss also include financial
assets held for trading and financial assets
designated upon initial recognition at fair value
through profit or loss. Financial assets are classified
as held for trading if they are acquired for the
purpose of selling or repurchasing in the near term.
Financial assets at fair value through profit or loss
are fair valued at each reporting date with all the
changes recognized in the Statement of Profit and
Loss.
Derecognition:
The Company de-recognises a financial asset only
when the contractual rights to the cash flows from
the asset expire, or when it transfers the financial
asset and substantially all the risks and rewards of
ownership of the asset to another entity. If the
Company neither transfers nor retains substantially
all the risks and rewards of ownership and continues
to control the financial asset, the Company
recognizes its retained interest in the asset and an
associated liability for amounts it may have to pay.
Impairment of Financial Assets:
The Company assesses impairment based on
expected credit loss ('ECL') model on the following:
• Financial assets that are measured at
amortised cost; and
• Financial assets measured at FVTOCI.
ECL is measured through a loss allowance on a
following basis:
• The 12 month expected credit losses (expected
credit losses that result from those default
events on the financial instruments that are
possible within 12 months after the reporting
date);
• Full life time expected credit losses (expected
credit losses that result from all possible
default events over the life of financial
instruments).
Financial Liabilities:
The Company's financial liabilities include trade
payable.
A. Initial recognition and measurement:
All financial liabilities at initial recognition are
classified as financial liabilities at amortized
cost or financial liabilities at fair value through
profit or loss, as appropriate. All financial
liabilities classified at amortized cost are
recognized initially at fair value net of directly
attributable transaction costs. Any difference
between the proceeds (net of transaction
costs) and the fair value at initial recognition is
recognised in the Statement of Profit and Loss.
B. Subsequent measurement:
The subsequent measurement of financial
liabilities depends upon the classification as
described below:-
(i) Financial Liabilities classified as
Amortised Cost:
Financial Liabilities that are not held for
trading and are not designated as at
FVTPL are measured at amortised cost
at the end of subsequent accounting
periods. Amortised cost is calculated by
taking into account any discount or
premium on acquisition and fees or costs
that are an integral part of the EIR.
Interest expense that is not capitalized as
part of costs of assets is included as
Finance costs in the Statement of Profit
and Loss.
(ii) Financial Liabilities classified as Fair
value through profit and loss (FVTPL):
Financial liabilities classified as FVTPL
includes financial liabilities held for
trading and financial liabilities
designated upon initial recognition as
FVTPL. Financial liabilities are classified
as held for trading if they are incurred for
the purpose of repurchasing in the near
term. Financial liabilities designated upon
initial recognition at FVTPL only if the
criteria in Ind AS 109 is satisfied.
C. Derecognition:
A financial liability is derecognised when the
obligation under the liability is discharged /
cancelled / expired. When 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 the de recognition of the original
liability and the recognition of a new liability.
The difference in the respective carrying
amounts is recognized in the Statement of
Profit and Loss.
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 recognised
amounts and there is an intention to settle on
a net basis, to realise the assets and settle the
liabilities simultaneously.
Other incomes, other than interest and
dividend are recognized when the same are
due to be received and right to receive such
other income is established.
n. Share Capital and Share Premium:
Ordinary shares are classified as equity. Incremental
costs directly attributable to the issue of new shares
are shown in equity as a deduction net of tax from
the proceeds. Par value of the equity share is
recorded as share capital and the amount received
in excess of the par value is classified as share
premium.
o. Dividend Distribution to equity shareholders:
The Company recognizes a liability to make cash
distributions to equity holders when the distribution
is authorized and the distribution is no longer at the
discretion of the Company. As per the corporate
laws in India, a distribution is authorized when it is
approved by the shareholders. A corresponding
amount is recognized directly in other equity along
with any tax thereon.
p. Cash Flows and Cash and Cash Equivalents:
Statement of cash flows is prepared in accordance
with the indirect method prescribed in the relevant
IND AS. For the purpose of presentation in the
statement of cash flows, cash and cash equivalents
includes cash on hand, cheques and drafts on hand,
deposits held 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, and book
overdrafts. However, Book overdrafts are to be
shown within borrowings in current liabilities in the
balance sheet for the purpose of presentation.
|