a. Statement of compliance
These separate financial statements of the Company have been prepared in accordance with Indian
Accounting Standards (Ind AS) notified under the Companies (Indian Accounting Standards)
Rules, 2015 as amended thereafter. For all periods up to and including the year ended March 31,
2024, the Company prepared its financial statements in accordance with the accounting standards
notified under section 133 of the Companies Act 2013, read together with paragraph 7 of the
Companies (Accounts) Rules, 2014 (Indian GAAP).
b. Use of estimates and judgement
The preparation of these financial statements in conformity with the recognition and measurement
principles of Ind AS requires the management of the Company to make estimates, judgements and
assumptions. These estimates, judgements and assumptions affect the reported balances of assets
and liabilities, disclosures relating to contingent liabilities as at the date of the financial statements
and the reported amounts of revenues and expenses for the year. These estimates and underlying
assumptions are reviewed on an ongoing basis.
Revisions to accounting estimates are recognised in the period in which the estimates are revised
and future periods are affected. Although these estimates are based on the management's best
knowledge of current events and actions, uncertainty about these estimates, judgements and
assumptions may result in the outcome that may require material adjustment in the carrying
amounts of assets and liabilities in future period.
Estimations which may cause material adjustment to the carrying amounts of assets and liabilities
within next financial year is in respect of useful lives of property, plant and equipment, valuation
of deferred tax assets, provisions and contingent liabilities and fair value measurement of financial
instruments have been discussed below.
c. Property, plant and equipment
Property, plant and equipment are stated at cost, less accumulated depreciation and impairment
loss, if any. The cost comprises the purchase price and any attributable costs of bringing the asset
to its working condition for its intended use. Any trade discounts and rebates are deducted in
arriving at the purchase price.
Advances paid towards the acquisition of property, plant and equipment outstanding at each
Balance Sheet date is classified as capital advances under other non-current assets and the cost of
assets not ready to use before such date are disclosed under 'Capital work-in-progress'.
Subsequent expenditure related to property, plant and equipment is capitalized only if it is
probable 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 costs of an items of property,
plant and equipment are recognised in the statement of profit and loss when incurred.
Gains or losses arising from of fixed assets are measured as the difference between the net proceeds
and carrying amount of the asset and are recognized in the statement of profit and loss when the
asset is derecognized.
d. Intangible Assets
Intangible assets including software licenses of enduring nature and acquired contractual rights
separately are measured on initial recognition, at cost. Intangible assets are carried at cost less
accumulated amortization and impairment losses, if any.
Cost comprises the purchase price and any attributable cost of bringing the asset to its working
condition for its intended use. Cost of internally generated intangible assets comprises all directly
attributable costs necessary to create, produce, and prepare the asset to be capable of operating in
the manner intended by management.
Gains or losses arising from de-recognition of an intangible asset 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 derecognized.
Capitalized development cost is carried at cost less accumulated amortization and impairment
losses, if any.
Intangibles under development include cost of intangibles that are not ready to be put to use.
e. Depreciation and amortisation
Depreciation has been provided on Written Down Value method on all assets as per Useful lives
prescribed under Schedule II of Companies Act 2013. Depreciation on assets added during the year
has been provided on pro-rata basis from the date of addition. Depreciation on deductions during
the year is provided on pro-rata basis up to the date of sale. Technical know-how included in
property, plant and equipment is amortized over a period of 10 years. Individual assets whose cost
does not exceed 5,000 are depreciated at 100%.
f. Financial instruments
A financial instrument is any contract that gives rise to a financial asset of one entity and a financial
liability or equity instrument of another entity.
(i) Financial assets
(a) Initial recognition and measurement
All financial assets are recognized initially at fair value plus, in the case of financial assets not
recorded at fair value through profit or loss, transaction costs that are attributable to the acquisition
of the financial asset.
(b) Subsequent measurement
For purposes of subsequent measurement, financial assets are classified in three categories:
• Financial assets at amortized cost
• Financial assets at fair value through other comprehensive income (FVTOCI)
• Financial assets at fair value through profit or loss (FVTPL)
(c) Financial assets at amortized cost:
A financial asset is measured at amortized cost if both following conditions are met:
• The financial 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.
After initial measurement, such financial assets are subsequently measured at amortized cost using
the effective interest rate (EIR) method. 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 other 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 other comprehensive income
A financial asset is measured at fair value through other comprehensive income if both of the
following criteria are met:
• The financial asset is held within a business model whose objective is achieved by both collecting
contractual cash flows and selling the 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.
After initial measurement, such financial assets, until they are derecognized or reclassified, are
subsequently measured at fair value and recognized in other comprehensive income except for
interest income, gain/loss on impairment, gain/loss on foreign exchange which is recognized in
the statement of profit and loss.
(d) Financial assets at fair value through profit or loss
A financial asset is measured at fair value through profit or loss unless it is measured at amortized
cost or at fair value through other comprehensive income.
In addition, the Company may elect to classify a financial asset, which otherwise meets amortized
cost or fair value through other comprehensive income criteria, as at fair value through profit or
loss. However, such election is allowed only if doing so reduces or eliminates a measurement or
recognition inconsistency (referred to as 'accounting mismatch').
After initial measurement, such financial assets are subsequently measured at fair value in the
statement of profit and loss.
(e) De-recognition of financial assets
A financial asset is de-recognized when:
• The contractual rights to receive cash flows from the financial asset have expired, or
• The Company has transferred its contractual rights to receive cash flows from the asset or has
assumed an obligation to pay the received cash flows in full without material delay to a third
party under a pass-through arrangement and either
(a) The Company has transferred substantially all the risks and rewards of the asset or
(b) The Company has neither transferred nor retained substantially all the risks and rewards of the
asset, but has transferred control of the asset.
g. Impairment
(i) Financial assets (other than at fair value)
The Company assesses at each reporting date 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 has used practical expedients in calculating expected credit losses on trade
receivables using a provision matrix. The provision matrix takes into account historical credit loss
experience for trade receivables to estimate the 12-month expected credit losses. The expected
credit loss allowance is based on the ageing of the receivables that are due and allowance rates
used in the provision matrix. For all other financial assets, expected credit losses are measured at
an amount equal to the 12-months 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.
(ii) Non-financial assets
Tangible and intangible assets
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 for the individual asset is estimated by the Company. If,
however, it is not possible to estimate the recoverable amount of the individual asset then the
Company determines the recoverable amount of the cash-generating unit (CGU) to which the asset
belongs (the asset's cash-generating unit). An impairment loss is recognised in the statement of
profit and loss when the recoverable amount of the asset or CGU is less than the carrying amount
of the asset or CGU.
Previously recognized impairment loss is reversed only if there has been a change in the estimates
used to determine the asset's recoverable amount since the last impairment loss was recognized. If
this is the case then the carrying amount of asset is increased to its recoverable amount. Such
reversal is recognized in statement of profit and loss.
h. Revenue recognition
The Company mainly derives its revenues from manufacturing of dairy, Brewery and other
equipment. The Company also earns revenues from sale of scrap.
Revenue is recognised upon satisfying the performance obligation by transferring promised goods
or services to customers for a consideration which the Company expects to receive in exchange for
those goods or services.
Revenue from sale of scrap is recognised when the goods are transferred to the customer and the
customer obtains the control over that asset.
Revenue is measured based on the transaction price being the consideration received from the
customer, adjusted for volume discounts, performance bonuses, price concessions and incentives,
if any, as specified in the contract with the customer. Revenue also excludes taxes collected from
customers.
Unbilled revenue represents excess of revenue earned over billings on contracts. Unbilled revenue
is recognised when there is unconditional right to receive cash and there is no uncertainty of
ultimate collection
Unearned or deferred revenue is recognised when there is billings in excess of revenue.
i. Interest Income
Interest on bank deposits is recognised on accrual basis.
j. Dividends
Dividends are recognized in profit or loss only when the right to receive payment is established.
k. Cash and cash equivalents
Cash and cash equivalents in the balance sheet comprise cash at banks and on hand and short-term
deposits with an original maturity of three months or less, which are subject to an insignificant risk
of changes in value.
For the purpose of the statement of cash flows, cash and cash equivalents consists of cash and short¬
term deposits, as defined above, net of outstanding bank overdrafts and cash credit facilities as
they are considered an integral part of the Company s cash management.
l. Investment in subsidiaries
Investment in subsidiaries are measured at cost less impairment loss, if any.
m. Employee benefits
(i) Gratuity
The Company provides for Gratuity, a defined benefit obligation plan, covering eligible employees
under Company Gratuity Scheme. At each reporting date, liabilities with respect to gratuity plan
are determined by actuarial valuation performed by independent actuary. The Company uses the
projected unit credit method to determine the present value of its defined benefit obligations and
the related current service cost and, where applicable, past service cost. The Company recognizes
the net obligation of a defined benefit plan in its Balance Sheet as an asset or liability.
Remeasurements of the net defined benefit liability/ asset is recognised in other comprehensive
income and are not reclassified to profit or loss in a subsequent period.
(ii) Provident fund
Contribution to provident fund is a defined contribution plan covering eligible employees. The
Company and the eligible employees make a monthly contribution to the provident fund
maintained by the Regional Provident Fund Commissioner equal to the specified percentage of the
basic salary of the eligible employees as the scheme. The contributions to the provident fund are
charged to the statement of profit and loss for the year, when the contributions are due. The
company has no obligation, other than the contribution payable to the provident fund.
(iii) Short-term Employee Benefits
All employee benefits payable within twelve months of rendering the service are classified as short¬
term benefits. Such benefits include salaries, wages, bonus, short term compensated absences,
awards, ex-gratia, performance pay etc. and are recognized in the period in which the employee
renders the related service. A liability is recognised for the amount expected to be paid when there
is a present obligation to pay this amount as a result of past service provided by the employee and
the obligation can be estimated reliably.
The Company provides accumulating and non-accumulating paid absences such as annual leave,
sick leave and casual leave. Accumulating paid absences are partly vesting and non-vesting. The
Company recognises the expected cost of accumulating paid absences as the additional amount
that the entity expects to pay as a result of the unused entitlement. Non-accumulating paid
absences do not carry forward and are lapsed if the current period's entitlement is not used in full
and do not entitle employees to a cash payment for unused entitlement on leaving the Company.
The Company does not recognises any liability or expense until the time of the absence.
Compensated absences which are expected to occur within twelve months after the end of the
period in which the employee renders the related services are recognised as undiscounted liability
at the balance sheet date. Compensated absences which are not expected to occur within twelve
months after the end of the period in which the employee renders the related services are
recognised as an actuarially determined liability at the present value of the defined benefit
obligation at the balance sheet date.
n. Borrowing costs
Borrowing costs are capitalized that are directly attributable to the acquisition, construction or
production of a qualifying asset as part of the cost of that asset. Other borrowing costs are
recognised as an expense in the period in which it is incurred.
o. Operating Lease
Lease arrangements where the risks and rewards incidental to ownership of an asset substantially
vest with the lessor, are recognised as operating lease. Operating lease payments are recognised on
a straight line basis over the lease term in the statement of profit and loss, unless the lease
agreement explicitly states that increase is on account of inflation.
p. Foreign currency translation
(i) Functional and presentation currency
Items included in the separate financial statements of the company are measured using the
currency of the primary economic environment in which the entity operates ( the functional
currency'). The separate financial statements are presented in Indian rupee (INR), which is the
Company's functional and presentation currency.
(ii) Initial Recognition
Foreign currency transactions are recorded in Indian currency, by applying the exchange rate
between the Indian currency and the foreign currency as at the date of transaction.
(iii) Conversion
Monetary items, designated in foreign currencies are revalued at the rate prevailing on the date of
Balance Sheet.
(iv) Exchange Differences
Exchange differences arising on the settlement and conversion of foreign currency transactions are
recognized as income or as expenses in the year in which they arise, except in cases where they
relate to the acquisition of qualifying assets, in which cases they were adjusted in the cost of the
corresponding asset.
(i) Current tax
Current tax is the amount of tax payable based on the taxable profit for the year as determined in
accordance with the applicable tax rates and the provisions of the Income tax Act, 1961.
Current tax assets and current tax liabilities are presented on the net basis in the balance sheet after
off-setting current tax paid against income tax provision only if the Company has a legally
enforceable right to set off the recognised amounts and it intends either to settle on a net basis.
Minimum alternate tax (MAT) paid in a period / year is charged to the statement of profit and loss
as current tax. MAT credit available is recognized as an asset only to the extent that there is
convincing evidence that the Company will pay normal income tax during the period, i.e., the
period for which MAT credit is allowed to be carried forward. In the year in which the Company
recognizes MAT credit as an asset in accordance with the Guidance Note on Accounting for Credit
Available in respect of Minimum Alternative Tax under the Income-tax Act, 1961, the said asset is
created by way of credit to the statement of profit and loss and shown as "MAT Credit
Entitlement." The Company reviews the "MAT credit entitlement" asset at each reporting date and
writes down the asset to the extent the Company does not have convincing evidence that it will
pay normal tax during the specified period.
(ii) Deferred Tax
Deferred tax is provided using the balance sheet approach on temporary differences between the
tax bases of assets and liabilities and their carrying amounts for financial reporting purposes at the
reporting date.
Deferred tax liabilities are recognized for all taxable temporary differences, except:
• When the deferred tax liability arises from the initial recognition of goodwill or an asset or
liability in a transaction that is not a business combination and, at the time of the
transaction, affects neither the accounting profit nor taxable profit or loss
• In respect of taxable temporary differences associated with investments in subsidiaries,
associates and interests in joint ventures, when the timing of the reversal of the temporary
differences can be controlled and it is probable that the temporary differences will not
reverse in the foreseeable future.
Deferred tax assets are recognized for all deductible temporary differences, the carry forward of
unused tax credits and any unused tax losses. Deferred tax assets are recognized to the extent that
it is probable that taxable profit will be available against which the deductible temporary
differences, and the carry forward of unused tax credits and unused tax losses can be utilized,
except:
• When the deferred tax asset relating to the deductible temporary differences arises from
the initial recognition of an asset or liability in a transaction that is not a business
combination and, at the time of the transaction, affects neither the accounting profit nor
taxable profit or loss
• In respect of deductible temporary differences associated with investments in subsidiaries,
associates and interests in joint ventures, deferred tax assets are recognized only to the
extent that it is probable that the temporary differences will reverse in the foreseeable
future and taxable profit will be available against which the temporary differences can be
utilized.
• Deferred tax assets are recognised for the carryforward of unused tax losses only if it is
probable that future taxable profits will be available against which such deferred tax assets
can be realized.
The carrying amount of deferred tax assets is reviewed at each reporting date and reduced to the
extent that it is no longer probable that sufficient taxable profit will be available to allow all or part
of the deferred tax asset to be utilized. Unrecognized deferred tax assets are re-assessed at each
reporting date and are recognized to the extent that it has become probable that future taxable
profits will allow the deferred tax asset to be recovered.
Deferred tax assets and liabilities are measured at the tax rates that are expected to apply in the
year when the asset is realized or the liability is settled, based on tax rates (and tax laws) that have
been enacted or substantively enacted at the reporting date.
Current and deferred taxes are recognized in the statement of profit and loss, except to the extent
that it relates to items recognized in other comprehensive income or directly in equity.
Deferred tax assets and deferred tax liabilities are offset if a legally enforceable right exists to set
off current tax assets against current tax liabilities and the deferred taxes relate to the same taxable
entity and the same taxation authority.
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