2. Significant Accounting Policies
(a) Statement of compliance and basis of preparation
and presentation
The financial statements of the Company have
been prepared in accordance with and to comply
in all material aspects with the Companies (Indian
Accounting Standards) Rules, 2015 ("Ind AS") as
amended and notified under Section 133 of the
Companies Act, 2013 ("the Act") and the relevant
provisions of the Act.
(b) Basis of measurement
The financial statements have been prepared on
accrual and going concern basis under the historical
cost convention except for certain class of financial
assets/ liabilities, share based payments and net
liability for defined benefit plans that are measured
at fair value.
(c) Rounding off
The Financial Statements are presented in INR and all
values are rounded off to the nearest thousands (INR
'000), unless otherwise stated.
(d) Use of estimates and judgements
The preparation of financial statements in
conformity with Ind AS requires management to
make judgments, estimates and assumptions, that
affect the application of accounting policies and the
reported amounts of assets, liabilities, income and
expenses at the date of these financial statements
and the reported amounts of revenues and expenses
for the years presented. Actual results may differ
Estimates and underlying assumptions are reviewed
at each balance sheet date. Revisions to accounting
estimates are recognized in the period in which the
estimate is revised and future periods affected.
Key sources of estimation uncertainty at the date
of financial statements, which may cause a material
adjustment to the carrying amounts of assets and
liabilities within the next financial year, is in respect
of useful lives of property, plant and equipment,
intangible assets, fair value of financial assets/
liabilities and impairment of investments
(e) Property, plant and equipment
Property, plant and equipment are stated at cost
of acquisition or construction less accumulated
depreciation and accumulated impairment, if any.
Cost includes financing cost attributable to the
construction or acquisition of qualifying tangible
assets upto the date the assets are ready for use.
Depreciation is provided on straight-line basis for
property, plant and equipment so as to expense
the depreciable amount, i.e. the cost less estimated
residual value, over its estimated useful lives.
The estimated useful lives and residual values are
reviewed annually and the effect of any changes in
estimate is accounted for on a prospective basis.
When an asset is scrapped or otherwise disposed off,
the cost and related depreciation are removed from
the books of account and resultant profit or loss, if
any, is reflected in the Statement of Profit and Loss.
The management's estimate of useful lives are in
accordance with Schedule II to the Companies Act,
2013, other than the following asset classes, based
on the Company's expected usage pattern supported
by technical assessment'
(f) Intangible assets
Intangible assets are initially measured at acquisition
cost including any directly attributable costs of
preparing the asset for its intended use. Intangible
assets with finite lives are amortized over their
estimated useful economic life and assessed for
impairment whenever there is an indication that the
intangible asset may be impaired. Intangible Assets
with indefinite useful lives are tested for impairment
at least annually, and whenever there is an indication
that the asset may be impaired.
(g) Impairment of assets
At the end of each reporting period, the Company
reviews the carrying amounts of its property, plant
& equipment, and intangible assets to determine
whether there is any indication that those assets
have suffered an impairment loss. If any such
indication exists, the recoverable amount, which is
the higher of the value in use or fair value less cost
to sell, of the asset or cash-generating unit, as the
case may be, is estimated and impairment loss (if any)
is recognized and the carrying amount is reduced
to its recoverable amount. In assessing the value in
use, the estimated future cash flows are discounted
to their present value using a pre-tax discount rate
that reflects current market assessments of the time
value of money and the risks specific to the asset for
which the estimates of future cash flows have not
been adjusted. When it is not possible to estimate
the recoverable amount of an individual asset, the
Company estimates the recoverable amount of the
cash-generating unit to which the asset belongs.
When an impairment loss subsequently reverses, the
carrying amount of the asset or a cash-generating
unit is increased to the revised estimate of its
recoverable amount, so that the increased carrying
amount does not exceed the carrying amount that
would have been determined had no impairment loss
been recognized for the asset (or cash-generating
unit) earlier.
(h) Inventories
Inventories comprise all costs of purchase, conversion
and other costs incurred in bringing the inventories to
their present location and condition. Raw materials
and bought out components are valued at the lower
of cost or net realisable value. Cost is determined on
the basis of the weighted average method.
Finished goods produced, stock in trade and work-
in-progress are carried at cost or net realisable value
whichever is lower.
(i) Foreign exchange transactions and translation
Transactions in foreign currencies i.e. other than
the Company's functional currency of Indian Rupees
are recognized at the rates of exchange prevailing
at the dates of the transactions. At the end of each
reporting period, monetary items denominated in
foreign currencies are translated at the functional
currency using exchange rates prevailing at that date.
Non-monetary items carried at fair value that are
denominated in foreign currencies are retranslated
at the rates prevailing at the date when the fair value
is determined. Exchange differences on monetary
items are recognized in profit or loss in the period in
which they arise.
O') Financial assets, financial liabilities and equity
instruments
Financial assets and liabilities are recognized when
the Company becomes a party to the contractual
provisions of the instrument. Financial assets and
liabilities are initially measured at fair value, 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 (other than financial
assets and financial liabilities at fair value through
profit or loss) are added to or deducted from the
fair value measured on initial recognition of financial
asset or financial liability.
The Company derecognises 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. The
Company derecognises financial liabilities when, and
only when, the Company's obligations are discharged,
cancelled or have expired.
Cash and cash equivalents
The Company considers all highly liquid investments,
which are readily convertible into known amounts
of cash that are subject to an insignificant risk of
change in value, to be cash equivalents. Cash and
cash equivalents consist of balances with banks
which are unrestricted for withdrawal and usage. It
also includes short-term balances with an original
maturity of three months or less from the date of
acquisition.
Financial assets at Fair value through other
comprehensive income
Financial assets are subsequently measured at fair
value through Other Comprehensive Income if these
financial assets are held for collection of contractual
cash flows and for selling the financial assets, where
the asset's cash flows represent solely payments of
principal and interest.
Movements in the carrying value are taken through
Other Comprehensive income, except for the
recognition of impairment gains or losses, interest
revenue and foreign exchange gains or losses
which are recognised in the Statement of Profit
and Loss. When the financial asset is derecognised,
the cumulative gain or loss previously recognised in
Other Comprehensive Income is reclassified from
Other Comprehensive Income to the Statement of
Profit and Loss. Interest income on such financial
assets is included as a part of the Company's income
in the Statement of Profit and Loss using the effective
interest rate method.
Financial assets at Fair value through profit or loss
Assets that do not meet the criteria for amortised
cost or FVOCI are measured at fair value through
profit or loss. A gain or loss on such debt instrument
that is subsequently measured at FVTPL and is not
part of a hedging relationship as well as interest
income is recognised in the Statement of Profit and
Loss.
De-recognition
A financial asset is derecognised only when the
Company has transferred the rights to receive cash
flows from the financial asset. Where the Company
has transferred an asset, the Company evaluates
whether it has transferred substantially all risks and
rewards of ownership of the financial asset. In such
cases, the financial asset is derecognised. Where the
Company has not transferred substantially all risks
and rewards of ownership of the financial asset,
the financial asset is not derecognised. Where the
Company retains control of the financial asset, the
asset is continued to be recognised to the extent of
continuing involvement in the financial asset.
Financial liabilities
All financial liabilities are recognised initially at fair
value Transaction costs that are directly attributable
to the acquisition or issue of financial liabilities,
which are not at fair value through profit or loss, are
adjusted to the fair value on initial recognition.
After initial recognition, financial liabilities that are
not carried at fair value through profit or loss are
subsequently measured at amortised cost using
the effective interest method. Gains and losses are
recognised in the Statement of Profit and Loss when
the liabilities are derecognised, and through the
amortisation process.
De-recognition
A financial liability is derecognised when the obligation
under the liability is discharged or cancelled or
expires. 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 a de-recognition of the
original liability and the recognition of a new liability,
and the difference in the respective carrying amounts
is recognised in the Statement of Profit and Loss.
(k) 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.
Net turnover is determined as income from the
supply of goods and services, less discounts and such
like, exclusive of turnover taxes.
Sale of goods
Revenue is recognized when the significant risks
and rewards of ownership of the goods have been
passed to the buyer. Sales are disclosed net of GST,
trade discounts and returns, as applicable. Company
derives revenues primarily from purchase of e-waste
Scraps, segregates and accordingly sell it to the
concerned customers.
Income from services
Revenue from services is recognized when services
have been rendered and there should be no
uncertainty regarding consideration and its ultimate
collection. Company provides Data Destruction
Services as a part of the services.
Dividend and interest income
Dividend from investments are recognized in profit or
loss when the right to receive payment is established.
Interest income from a financial asset is recognized
when it is probable that the economic benefits will
flow to the Company and the amount of income can
be measured reliably.
(l) Employee benefits
Superannuation Fund, ESIC and Labour Welfare
Fund
The Company's contribution paid / payable during
the year to Superannuation Fund, ESIC and Labour
Welfare Fund are recognized in profit or loss.
Defined contribution plans
The Company pays provident fund contributions to
publicly administered funds as per local regulations.
The Company has no further payment obligations once
the contributions have been paid. The contributions
are accounted for as defined contribution plans
and the contributions are recognized as employee
benefit expenses when they are due.
The Company is liable for the contribution and any
shortfall and remeasurement thereof, if any, based
on actuarial valuation is recognized through Other
Comprehensive Income (OCI).
(n) Borrowing Costs
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 or sale, are added to the cost of those
assets, until such time as the assets are substantially
ready for their intended use or sale. Interest income
earned on the temporary investment of specific
borrowings pending their expenditure on qualifying
assets is deducted from the borrowing costs eligible
for capitalization. All other borrowing costs are
recognized in profit or loss in the period in which they
are incurred.
(o) Taxes
Current tax
Current tax is determined as the amount of tax
payable in respect of taxable income for the year. The
Company's current tax is calculated using tax rates
that have been enacted or substantively enacted by
the end of the reporting period.
Deferred tax
Deferred tax assets and liabilities are recognized
for the future tax consequences of temporary
differences between the carrying values of assets
and liabilities and their respective tax bases.
Deferred tax liabilities and assets are measured at
the tax rates that are expected to apply in the period
in which the liability is settled or the asset realized,
based on tax rates (and tax laws) that have been
enacted or substantively enacted by the end of the
reporting period. The measurement of deferred tax
liabilities and assets reflects the tax consequences
that would follow from the manner in which the
Company expects, at the end of the reporting period,
to recover or settle the carrying amount of its assets
and liabilities.
Deferred tax assets and liabilities are not recognized
for the temporary differences arising from the initial
recognition of assets and liabilities in a transaction
that affects neither the taxable profit nor the
accounting profit.
The carrying amount of deferred tax assets is
reviewed at the end of each reporting period and
reduced to the extent that it is no longer probable
that sufficient taxable profits will be available to
allow all or part of the asset to be recovered.
Current and deferred tax for the year
Current and deferred tax are recognized in profit
or loss, except when they relate to items that are
recognized in other comprehensive income or directly
in equity, in which case, the current and deferred tax
are also recognized in other comprehensive income
or directly in equity respectively. Where current tax
or deferred tax arises from the initial accounting for
a business combination, the tax effect is included in
the accounting for the business combination.
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