B. Material Accounting Policies
B.1. Statement of Compliance with Ind AS
These financial statements are prepared in accordance with Indian Accounting Standards (Ind AS) as per the
Companies (Indian Accounting Standards) Rules, 2015 and Companies (Indian Accounting Standards)
(Amendment) Rules, 2016 notified under Section 133 of Companies Act, 2013 (the ‘Act') and other relevant
provisions of the Act.
B.2. Basis of Accounting
The company maintains accounts on accrual basis following the historical cost convention, except for certain
financial instruments that are measured at fair value in accordance with Ind AS. The carrying value of all the
items of property, plant and equipment and investment property as on date of transition is considered as the
deemed cost.Fair value measurements under Ind AS are categorised as below based on the degree to which
the inputs to the fair value measurements are observable and the significance of the inputs to the fair value
measurement in its entirety:
• Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities that the
company can access at measurement date;
• Level 2 inputs are inputs, other than quoted prices included in level 1, that are observable for the asset
or liability, either directly or indirectly; and
• Level 3 inputs are unobservable inputs for the valuation of assets/liabilities.
B. 3. Presentation of Financial Statements
The Balance Sheet and Statement of Profit and Loss are prepared and presented in the format prescribed in
the Schedule III to the Companies Act, 2013 (“the Act”). The Statement of Cash Flows has been prepared and
presented as per the requirements of Ind AS 7 “Statement of Cash flows”. The disclosure requirements with
respect to items in the Balance Sheet and Statement of Profit and Loss, as prescribed in the Schedule III to the
Act, are presented by way of Notes forming part of the Financial Statements along with the Other Notes
required to be disclosed under the notified Accounting Standards and the SEBI (Listing Obligations and
Disclosure Requirements) Regulations, 2015.Amounts in the Financial Statements are presented in Indian
Rupees rounded off to two decimal places as permitted by Schedule III to the Companies Act, 2013. Per share
data are presented in Indian Rupees to two decimals places.
C. Borrowing Costs
Borrowing cost are interest and other costs (including exchange differences relating to foreign currency
borrowings to the extent that they are regarded as an adjustment to interest cost) incurred in connection with
the borrowing of funds. Borrowing costs directly attributable to acquisition or construction of asset which
necessarily take a substantial period of time to get ready for their intended use are capitalised as part of cost
of asset until such time the assets are substantially ready for their intended use. Other borrowing costs are
recognised as an expense in the period in which they are incurred.
D. Property, Plant and Equipment (PPE)
i. Recognition and Measurement
PPE is recognised when 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. PPE is stated at original cost net of tax/
duty credits availed, if any, less accumulated depreciation and cumulative impairment, if any. Cost
includes professional fees related to the acquisition of PPE and for qualifying assets, borrowing costs
capitalised in accordance with the company's accounting policy.
PPE not ready for the intended use on the date of the Balance Sheet are disclosed as “capital work-in¬
progress”.
ii. Subsequent Expenditure
Subsequent expenditure is capitalised only if it is probable that the future economic benefits associated
with the expenditure will flow to the Company.
iii. Depreciation / Amortisation
Depreciation is recognised using Straight Line Method so as to write off the cost of the assets (other than
freehold land and properties under construction) less their residual values over their useful lives specified
in Schedule II to the Companies Act, 2013, or in the case of assets where the useful life was determined
by technical evaluation, over the useful life so determined. Depreciation method is reviewed at each
financial year end to reflect the expected pattern of consumption of the future economic benefits embodied
in the asset. The estimated useful life and residual values are also reviewed at each financial year end
and the effect of any change in the estimates of useful life/residual value is accounted on prospective
basis.
Where cost of a part of the asset (“asset component”) is significant to total cost of the asset and useful
life of that part is different from the useful life of the remaining asset, useful life of that significant part is
determined separately and such asset component is depreciated over its separate useful life.
Depreciation charge for impaired assets is adjusted in future periods in such a manner that the revised
carrying amount of the asset is allocated over its remaining useful life.
Assets acquired under finance leases are depreciated on a straight line basis over the lease term. Where
there is reasonable certainty that the company shall obtain ownership of the assets at the end of the lease
term, such assets are depreciated based on the useful life prescribed under Schedule II to the Companies
Act, 2013 or based on the useful life adopted by the company for similar assets.
Freehold land is not depreciated.
iv. Derecognition
An item of Property, Plant and Equipment is derecognised upon disposal or when no future economic
benefits are expected to arise from the continued use of assets.
E. Intangible Assets
i. Initial Recognition and Classification
Intangible assets are recognised when it is probable that the future economic benefits that are attributable
to the asset will flow to the enterprise and the cost of the asset can be measured reliably. Intangible
assets are stated at original cost net of tax/duty credits availed, if any, less accumulated amortisation
and cumulative impairment. Administrative and other general overhead expenses that are specifically
attributable to acquisition of intangible assets are allocated and capitalised as a part of the cost of the
intangible assets.
ii. Subsequent Expenditure
Subsequent expenditure is capitalised only when it increases the future economic benefits embodied in
the specific asset to which it relates. All other expenditures are recognised in profit or loss as incurred.
iii. Amortisation
Intangible assets are amortised on straight line basis over the estimated useful life. The method of
amortisation and useful life is are reviewed at the end of each accounting year with the effect of any
changes in the estimate being accounted for on a prospective basis.
Amortisation on impaired assets is provided by adjusting the amortisation charge in the remaining periods
so as to allocate the asset's revised carrying amount over its remaining useful life.
iv. Derecognition
An item of an intangible asset is derecognized upon disposal or when no future economic benefits are
expected to arise from the continued use of assets.
F. Impairment of Assets
As at the end of each accounting year, the company reviews the carrying amounts of its PPE, Intangible
assets and investments in subsidiary, associate and joint venture companies to determine whether there is
any indication that those assets have suffered an impairment loss. If such indication exists, the said assets are
tested for impairment so as to determine the impairment loss, if any. Goodwill and the intangible assets with
indefinite life are tested for impairment each year.
Impairment loss is recognised when the carrying amount of an asset exceeds its recoverable amount.
Recoverable amount is determined:
(i) in the case of an individual asset, at the higher of the net selling price and the value in use; and
(ii) in the case of a cash generating unit (a company of assets that generates identified, independent cash
flows), at the higher of the cash generating unit's net selling price and the value in use.
(The amount of value in use is determined as the present value of estimated future cash flows from the
continuing use of an asset and from its disposal at the end of its useful life. For this purpose, the discount rate
(pre-tax) is determined based on the weighted average cost of capital of the company suitably adjusted for
risks specified to the estimated cash flows of the asset).
For this purpose, a cash generating unit is ascertained as the smallest identifiable company of assets that
generates cash inflows that are largely independent of the cash inflows from other assets or companys of
assets.
If recoverable amount of an asset (or cash generating unit) is estimated to be less than its carrying amount,
such deficit is recognised immediately in the Statement of Profit and Loss as impairment loss and the carrying
amount of the asset (or cash generating unit) is reduced to its recoverable amount.
When an impairment loss subsequently reverses, the carrying amount of the asset (or cash generating unit)
is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does
not exceed the carrying amount that would have been determined had no impairment loss is recognised for the
asset (or cash generating unit) in prior years. A reversal of an impairment loss is recognised immediately in the
Statement of Profit and Loss.
G. Leases
The determination of whether an agreement is, or contains, a lease is based on the substance of the agreement
at the date of inception.
Lease Accounting
As a Lessee
Finance Lease
At the commencement of the lease term, the Company recognizes finance leases as assets and liabilities in its
balance sheet at amounts equal to the fair value of the leased property or, if lower, the present value of the
minimum lease payments. The corresponding rental obligations, net of finance charges, are included in
borrowings or other financial liabilities as appropriate. The discount rate used in calculating the present value
is the interest rate implicit in the lease or the Company's incremental borrowing rate. Minimum lease payments
are apportioned between the finance charge and the reduction of the outstanding liability.
Operating Lease
Lease payments under an operating lease are recognized as an expenses on a straight-line basis over the
lease term unless either:
A. another systematic basis is more representative of the time pattern of the user's benefit; or
B. the payments are structured to increase in line with expected general inflation to compensate for the
lessor's expected inflationary cost increases.
As a Lessor
Finance Lease
Amounts due from lessees under finance leases are recorded as receivables at the Company's net investment
in the leases. Finance lease income is allocated to accounting periods so as to reflect a constant periodic rate
of return on the net investment outstanding in respect of the lease.
Operating Lease
Lease income from operating lease (excluding amount for services such as insurance and maintenance) is
recognized in the statement of profit or loss on a straight-line basis over the lease term, unless either:
A. another systematic basis is more representative of the time pattern of the user's benefit; or
B. the payments are structured to increase in line with expected general inflation to compensate for the
lessor's expected inflationary cost increases.
H. Use of Estimates and Judgements
The preparation of Financial Statements in conformity with Ind AS requires that the management of the
company makes estimates and assumptions that affect the reported amounts of income and expenses of the
period, the reported balances of assets and liabilities and the disclosures relating to contingent liabilities as of
the date of the Financial Statements. The estimates and underlying assumptions are reviewed on an ongoing
basis. Revisions to accounting estimates include useful lives of Property, Plant and Equipment, Intangible
Assets, allowance for doubtful debts/advances, future obligations in respect of retirement benefit plans, expected
cost of completion of contracts, provision for rectification costs, fair value measurement etc. Difference, if any,
between the actual results and estimates is recognised in the period in which the results are known.
I. Financial Instruments
Financial assets and/or financial liabilities are recognised when the company becomes party to a contract
embodying the related financial instruments. All financial assets, financial liabilities and financial guarantee
contracts are initially measured at transaction values and where such values are different from the fair value,
at fair value. Transaction costs that are 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 as the case may be, the fair value of such assets or liabilities, on initial recognition. Transaction
costs directly attributable to the acquisition of financial assets or financial liabilities at fair value through profit or
loss are recognised immediately in profit or loss. In case of interest free or concession loans given to
subsidiary companies, the excess of the actual amount of the loan over initial measure at fair value is
accounted as an equity investment.
Financial Assets
Classification
All recognised financial assets are subsequently measured in their entirety at amortised cost or at fair value
dependingon the classification of the financial assets as follows:
1. Investments in debt Instruments that are designated as fair value through profit or loss (FVTPL) - at fair
value.
2. Other investments in debt instruments - at amortised cost, subject to following conditions:
• The asset is held within a business model whose objective is to hold assets in order to collect
contractual cash Flows and
• The contractual terms of instrument give rise on specified dates to cash flows that are solely
payments of principal and interest on the principal amount outstanding.
3. Debt instruments that meet the following conditions are subsequently measured at fair value through
other comprehensive income (FVTOCI) (unless the same are designated as fair value through profit
or loss)
• The asset is held within a business model whose objective is achieved both by collecting contractual
cash flowsand selling financial assets; and
• The contractual terms of instrument give rise on specified dates to cash flows that are solely
payments ofprincipal and interest on the principal amount outstanding.
4. Investment in equity instruments issued by subsidiary, associates and joint ventures are measured at
cost less impairment.
5. Investment in preference shares of the subsidiary companies are treated as equity instruments if the
same are convertible into equity shares or are redeemable out of the proceeds of equity instruments
issued for the purpose of redemption of such investments. Investment in preference shares not meeting
the aforesaid conditions are classified as debt instruments at FVTPL.
6. Investments in equity instruments are classified as at FVTPL, unless the related instruments are not held
for trading and the company irrevocably elects on initial recognition to present subsequent changes in fair
value in Other Comprehensive Income.
Initial Measurement
At initial recognition, the Company measures a financial asset when it becomes a party to the contractual
provisions of the instruments and measures at its fair value except trade receivables which are initially
measured at transaction price. Transaction costs are incremental costs that are directly attributable to the
acquisition of the financial asset. Transaction costs of financial assets carried at fair value through profit or
loss are expensed in profit or loss. A regular way purchase and sale of financial assets are accounted for at
trade date.
Subsequent Measurement
- Financial assets at FVTPL
These assets are subsequently measured at fair value. Net gains including any interest or dividend
income, are recognized in profit or loss.
- Financial assets at amortized cost
These assets are subsequently measured at amortized cost using the effective interest method. The
amortized cost is reduced by impairment losses. Interest income, foreign exchange gains and losses
and impairment are recognized in profit or loss. Any gain or loss on de-recognition is recognized in profit
or loss.
For financial assets that are measured at FVTOCI, income by way of interest, dividend and exchange
difference (on debt instrument) is recognised in profit or loss and changes in fair value (other than on
account of such income) are recognised in Other Comprehensive Income and accumulated in other
equity. On disposal of debt instruments measured at FVTOCI, the cumulative gain or loss previously
accumulated in other equity is reclassified to profit or loss. In case of equity instruments measured at
FVTOCI, such cumulative gain or loss is not reclassified to profit or loss on disposal of investments.
Derecognition
A financial asset is primarily derecognised when:
1. the right to receive cash flows from the asset has expired, or
2. the company has transferred its 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 (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.
On derecognition of a financial asset in its entirety, the difference between the carrying amount measured
at the date of derecognition and the consideration received is recognised in profit or loss.
Impairment of Financial Assets
The company recognises impairment loss on trade receivables using expected credit loss model, which
involves use of a provision matrix constructed on the basis of historical credit loss experience as permitted
under Ind AS 109
Financial Liabilities
i) Classification, Subsequent Measurement and Gains and Losses
Financial liabilities, including derivatives and embedded derivatives, which are designated for measurement
at FVTPL are subsequently measured at fair value. Financial guarantee contracts are subsequently
measured at the amount of impairment loss allowance or the amount recognised at inception net of
cumulative amortisation, whichever is higher. All other financial liabilities including loans and borrowings
are measured at amortised cost using Effective Interest Rate (EIR) method.
Derecognition
The Company derecognizes a financial liability when its contractual obligations are discharged or cancelled, or
expire.The Company also derecognises a financial liability when its terms are modified and the cash flows
under the modified terms are substantially different. In this case, a new financial liability based on the modified
terms is recognised at fair value. The difference between the carrying amount of the financial liability extinguished
and the new financial liability with modified terms is recognised in the profit or loss.
J. Offsetting Financial Instruments
The financial assets and financial liabilities are offset and presented on net basis in the Balance Sheet when
there is a current legally enforceable right to set-off the recognised amounts and it is intended to either settle
on net basis or to realise the asset and settle the liability simultaneously.
K. Basis of Measurement
The financial statements have been prepared on the historical cost basis except for the following items:
L. Inventories
Inventories are measured at the lower of cost and net realisable value. The cost of inventories includes
expenditure incurred in acquiring the inventories, production or conversion costs and other costs incurred in
bringing them to their present location and condition. In the case of manufactured inventories and work-in¬
progress is valued at actual cost of production. Cost of raw materials, stores and spares are determined on
weighted average basis.Net realisable value is the estimated selling price in the ordinary course of business,
less the estimated costs of completion and selling expenses.
The net realisable value of work-in-progress is determined with reference to the selling prices of related
finished products.
Raw materials, components and other supplies held for use in the production of finished products are not
written down below cost except in cases where material prices have declined and it is estimated that the cost
of the finished products will exceed their net realisable value.The comparison of cost and net realisable value
is made on an item-by-item basis.Excess/shortages if any, arising on physical verification are absorbed in the
respective consumption accounts. Finished Goods is determined on full absorption cost basis.
M. Employee Benefits
i. Short Term Employee Benefit Obligations
Employee benefits such as salaries, wages, short term compensated absences, expected cost of
bonus, ex-gratia and performance-linked rewards falling due wholly within twelve months of rendering the
service are classified as short term employee benefits and are expensed in the period in which the
employee renders the related service.
ii. Other Long Term Employee Benefit Obligations
The obligation for long term employee benefits such as long term compensated absences, long service
award etc. is measured at present value of estimated future cash flows expected to be made by the
company and is recognised in a similar manner as in the case of defined benefit plans.
Long term employee benefit costs comprising current service cost and gains or losses on curtailments
and settlements, remeasurements including actuarial gains and losses are recognised in the Statement
of Profit and Loss as employee benefit expenses. Interest cost implicit in long term employee benefit cost
is recognised in the Statement of Profit and Loss under finance cost.
iii. Post-Employment Obligations
(A) Defined Contribution Plan:
The company's superannuation scheme, state governed provident fund scheme, employee state
insurance scheme and employee pension scheme are defined contribution plans. The contribution
paid/payable under the schemes is recognised during the period in which the employee renders the
related service.
(B) Defined Benefit Plan:
Gratuity Obligations
The Company has an obligation towards gratuity, a defined benefit retirement plan covering eligible
employees. The plan provides for a lump sum payment to vested employees at retirement, death
while in employment or on termination of employment of an amount equivalent to 15 to 30 days
salary payable for each completed year of service. Vesting occurs upon completion of five years of
service. The Company makes annual contributions to gratuity fund maintained with Life Insurance
Corporation of India. The Company accounts for the liability for gratuity benefits payable in future
based on an independent actuarial valuation.
Leave Encashment
The company provides for the encashment of leave or leave with pay subject to certain rules. The
employees are entitled to accumulated leave subject to certain limits, for future encashment. The liability
is provided based on the number of days of unutilized leave at each balance sheet date. The Company
makes contributions to leave encashment fund maintained with Life Insurance Corporation of India. The
Company accounts for the liability for benefits payable in future based on an independent actuarial
valuation.
Provident Fund
The eligible employees of the Company are entitled to receive benefits under the provident fund, a defined
contribution plan, in which both employees and the company make monthly contribution at a specified
percentage of the covered employees' salary. The contributions as specified under the law are paid to
the provident fund and pension fund to respective Regional Provident Fund Commissioner and the
Central Provident Fund under the State Pension Scheme.
The obligation is measured at the present value of the estimated future cash flows using a discount rate
based on the market yield on government securities of a maturity period equivalent to the weighted
average maturity profile of the defined benefit obligations at the Balance Sheet date.
Remeasurement, comprising actuarial gains and losses, the return on plan assets (excluding amounts
included in net interest on the net defined benefit liability or asset) and any change in the effect of asset
ceiling (wherever applicable) is recognised in other comprehensive income and is reflected in retained
earnings and the same is not eligible to be reclassified to profit or loss.
Defined benefit employee costs comprising current service cost, past service cost and gains or losses
on settlements are recognised in the Statement of Profit and Loss as employee benefits expense.
Interest cost implicit in defined benefit employee cost is recognised in the Statement of Profit and Loss
under finance cost. Gains or losses on settlement of any defined benefit plan are recognised in profit or
loss when such settlement occurs. Past service cost is recognised as expense at the earlier of the plan
amendment or curtailment and when the company recognises related restructuring costs or termination
benefits.
In case of funded plans, the fair value of the plan assets is reduced from the gross obligation under the
defined benefit plans to recognise the obligation on a net basis.
iv. Termination Benefits
Termination benefits such as compensation under employee separation schemes are recognised as
expense when the company's offer of the termination benefit is accepted or when the company recognises
the related restructuring costs whichever is earlier.
N. Foreign Currency Transactions
The functional currency and presentation currency of the company is Indian Rupee.
Transactions in foreign currencies are translated into the functional currency of the Company at exchange
rates at the date of transactions or an average rate if the average rate approximates the actual rate at the date
of transaction.Transactions in currencies other than the company's functional currency are recorded on initial
recognition using the exchange rate at the transaction date. At each Balance Sheet date, foreign currency
monetary items are reported using the closing rate. Non-monetary items that are measured in terms of
historical cost in foreign currency are not retranslated. Exchange differences that arise on settlement of
monetary items or on reporting of monetary items at each Balance Sheet date at the closing spot rate are
recognised in profit or loss in the period in which they arise except for:
A. exchange differences on foreign currency borrowings relating to assets under construction for future
productive use, which are included in the cost of those assets when they are regarded as an adjustment
to interest costs on those foreign currency borrowings; and
B. exchange differences on transactions entered into in order to hedge certain foreign currency risks.
Financial statements of foreign operations whose functional currency is different than Indian Rupee are
translated into Indian Rupees as follows:
A. assets and liabilities for each Balance Sheet presented are translated at the closing rate at the date of that
Balance Sheet;
B. income and expenses for each income statement are translated at average exchange rates; and
C. all resulting exchange differences are recognised in other comprehensive income and accumulated in
equity as foreign currency translation reserve for subsequent reclassification to profit or loss on disposal
of such foreign operations.
O. Revenue from Contract With Customer
Ind AS 115 was issued on 28 March, 2018 and supersedes Ind AS 11 Construction Contracts and Ind AS 18
Revenue and it applies, with limited exceptions, to all revenue arising from contracts with its customers. Ind AS
115 establishes a five-step model to account for revenue arising from contracts with customers and requires
that revenue be recognised at an amount that reflects the consideration to which an entity expects to be
entitled in exchange for transferring goods or services to a customer.
Ind AS 115 requires entities to exercise judgement, taking into consideration all of the relevant facts and
circumstances when applying each step of the model to contracts with their customers. The company adopted
Ind AS 115 using the modified retrospective method of adoption with the date of initial application of 1 April,
2018. Under this method, the standard can be applied either to all contracts at the date of initial application or
only to contracts that are not completed at this date. The compnay elected to apply the standard to all contracts
as at 1 April, 2018. However, the application of Ind AS 115 does not have any significant impact on the
recognition and measurement of revenue and related items.
(A) Sale of Goods
Revenue from sale of goods is recognised at the point in time when control of the goods is transferred to
the customer. The normal credit term is 1 to 180 days upon delivery. The revenue is measured on the
basis of the consideration defined in the contract with a customer, including variable consideration, such
as discounts, volume rebates, or other contractual reductions. As the period between the date on which
the company transfers the promised goods to the customer and the date on which the customer pays for
these goods is generally one year or less, no financing components are taken into account. The company
considers whether there are other promises in the contract that are separate performance obligations to
which a portion of the transaction price needs to be allocated.
(B) Rendering of Services
Revenue from services rendered is recognised as the services are rendered and is booked based on
agreements/arrangements with the concerned parties.
(C) Other Income
Export entitlements (arising out of Duty Drawback, Merchandise Export from India) are recognised when
the right to receive credit as per the terms of the schemes is established in respect of the exports made
and where there is no significant uncertainty regarding the ultimate collection of the relevant export
proceeds. Operating revenues of subsidiaries are considered to be operating revenues in the consolidated
financial statements.
P. Taxation
Income tax comprises current and deferred tax. It is recognised in profit or loss except to the extent that it
relates to a business combination or to an item recognised directly in equity or in other comprehensive income.
Income Tax
Current tax comprises the expected tax payable or receivable on the taxable income or loss for the year and
any adjustment to the tax payable or receivable in respect of previous years. The amount of current tax
reflects the best estimate of the tax amount expected to be paid or received after considering the uncertainty,
if any, related to income taxes. It is measured using tax rates (and tax laws) enacted or substantively enacted
by the reporting date. Current tax assets and current tax liabilities are offset only if there is a legally enforceable
right to set off the recognised amounts, and it is intended to realise the asset and settle the liability on a net
basis or simultaneously.
Deferred Taxes
Deferred tax is recognised on temporary differences between the carrying amounts of assets and liabilities in
the company's financial statements and the corresponding tax bases used in computation of taxable profit and
quantified using the tax rates and laws enacted or substantively enacted as on the Balance Sheet date.
Deferred tax liabilities are generally recognised for all taxable temporary differences including the temporary
differences associated with investments in subsidiaries and associates, and interests in joint ventures, except
where the company is able to control the reversal of the temporary difference and it is probable that the
temporary difference will not reverse in the foreseeable future.
Deferred tax assets are generally recognised for all taxable temporary differences to the extent that is
probable that taxable profits will be available against which those deductible temporary differences can be
utilised. 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.
Deferred tax assets relating to unabsorbed depreciation/business losses/losses under the head “capital
gains” are recognised and carried forward to the extent of available taxable temporary differences or where
there is convincing other evidence that sufficient future taxable income will be available against which such
deferred tax assets can be realised.
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 reporting period, to recover or settle the carrying
amount of its assets and liabilities.
Transaction or event which is recognised outside profit or loss, either in other comprehensive income or in
equity, is recorded along with the tax as applicable.
B. Material Accounting Policies
B.1. Statement of Compliance with Ind AS
These financial statements are prepared in accordance with Indian Accounting Standards (Ind AS) as per the
Companies (Indian Accounting Standards) Rules, 2015 and Companies (Indian Accounting Standards)
(Amendment) Rules, 2016 notified under Section 133 of Companies Act, 2013 (the ‘Act') and other relevant
provisions of the Act.
B.2. Basis of Accounting
The company maintains accounts on accrual basis following the historical cost convention, except for certain
financial instruments that are measured at fair value in accordance with Ind AS. The carrying value of all the
items of property, plant and equipment and investment property as on date of transition is considered as the
deemed cost.Fair value measurements under Ind AS are categorised as below based on the degree to which
the inputs to the fair value measurements are observable and the significance of the inputs to the fair value
measurement in its entirety:
• Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities that the
company can access at measurement date;
• Level 2 inputs are inputs, other than quoted prices included in level 1, that are observable for the asset
or liability, either directly or indirectly; and
• Level 3 inputs are unobservable inputs for the valuation of assets/liabilities.
B. 3. Presentation of Financial Statements
The Balance Sheet and Statement of Profit and Loss are prepared and presented in the format prescribed in
the Schedule III to the Companies Act, 2013 (“the Act”). The Statement of Cash Flows has been prepared and
presented as per the requirements of Ind AS 7 “Statement of Cash flows”. The disclosure requirements with
respect to items in the Balance Sheet and Statement of Profit and Loss, as prescribed in the Schedule III to the
Act, are presented by way of Notes forming part of the Financial Statements along with the Other Notes
required to be disclosed under the notified Accounting Standards and the SEBI (Listing Obligations and
Disclosure Requirements) Regulations, 2015.Amounts in the Financial Statements are presented in Indian
Rupees rounded off to two decimal places as permitted by Schedule III to the Companies Act, 2013. Per share
data are presented in Indian Rupees to two decimals places.
C. Borrowing Costs
Borrowing cost are interest and other costs (including exchange differences relating to foreign currency
borrowings to the extent that they are regarded as an adjustment to interest cost) incurred in connection with
the borrowing of funds. Borrowing costs directly attributable to acquisition or construction of asset which
necessarily take a substantial period of time to get ready for their intended use are capitalised as part of cost
of asset until such time the assets are substantially ready for their intended use. Other borrowing costs are
recognised as an expense in the period in which they are incurred.
D. Property, Plant and Equipment (PPE)
i. Recognition and Measurement
PPE is recognised when 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. PPE is stated at original cost net of tax/
duty credits availed, if any, less accumulated depreciation and cumulative impairment, if any. Cost
includes professional fees related to the acquisition of PPE and for qualifying assets, borrowing costs
capitalised in accordance with the company's accounting policy.
PPE not ready for the intended use on the date of the Balance Sheet are disclosed as “capital work-in¬
progress”.
ii. Subsequent Expenditure
Subsequent expenditure is capitalised only if it is probable that the future economic benefits associated
with the expenditure will flow to the Company.
iii. Depreciation / Amortisation
Depreciation is recognised using Straight Line Method so as to write off the cost of the assets (other than
freehold land and properties under construction) less their residual values over their useful lives specified
in Schedule II to the Companies Act, 2013, or in the case of assets where the useful life was determined
by technical evaluation, over the useful life so determined. Depreciation method is reviewed at each
financial year end to reflect the expected pattern of consumption of the future economic benefits embodied
in the asset. The estimated useful life and residual values are also reviewed at each financial year end
and the effect of any change in the estimates of useful life/residual value is accounted on prospective
basis.
Where cost of a part of the asset (“asset component”) is significant to total cost of the asset and useful
life of that part is different from the useful life of the remaining asset, useful life of that significant part is
determined separately and such asset component is depreciated over its separate useful life.
Depreciation charge for impaired assets is adjusted in future periods in such a manner that the revised
carrying amount of the asset is allocated over its remaining useful life.
Assets acquired under finance leases are depreciated on a straight line basis over the lease term. Where
there is reasonable certainty that the company shall obtain ownership of the assets at the end of the lease
term, such assets are depreciated based on the useful life prescribed under Schedule II to the Companies
Act, 2013 or based on the useful life adopted by the company for similar assets.
Freehold land is not depreciated.
iv. Derecognition
An item of Property, Plant and Equipment is derecognised upon disposal or when no future economic
benefits are expected to arise from the continued use of assets.
E. Intangible Assets
i. Initial Recognition and Classification
Intangible assets are recognised when it is probable that the future economic benefits that are attributable
to the asset will flow to the enterprise and the cost of the asset can be measured reliably. Intangible
assets are stated at original cost net of tax/duty credits availed, if any, less accumulated amortisation
and cumulative impairment. Administrative and other general overhead expenses that are specifically
attributable to acquisition of intangible assets are allocated and capitalised as a part of the cost of the
intangible assets.
ii. Subsequent Expenditure
Subsequent expenditure is capitalised only when it increases the future economic benefits embodied in
the specific asset to which it relates. All other expenditures are recognised in profit or loss as incurred.
iii. Amortisation
Intangible assets are amortised on straight line basis over the estimated useful life. The method of
amortisation and useful life is are reviewed at the end of each accounting year with the effect of any
changes in the estimate being accounted for on a prospective basis.
Amortisation on impaired assets is provided by adjusting the amortisation charge in the remaining periods
so as to allocate the asset's revised carrying amount over its remaining useful life.
iv. Derecognition
An item of an intangible asset is derecognized upon disposal or when no future economic benefits are
expected to arise from the continued use of assets.
F. Impairment of Assets
As at the end of each accounting year, the company reviews the carrying amounts of its PPE, Intangible
assets and investments in subsidiary, associate and joint venture companies to determine whether there is
any indication that those assets have suffered an impairment loss. If such indication exists, the said assets are
tested for impairment so as to determine the impairment loss, if any. Goodwill and the intangible assets with
indefinite life are tested for impairment each year.
Impairment loss is recognised when the carrying amount of an asset exceeds its recoverable amount.
Recoverable amount is determined:
(i) in the case of an individual asset, at the higher of the net selling price and the value in use; and
(ii) in the case of a cash generating unit (a company of assets that generates identified, independent cash
flows), at the higher of the cash generating unit's net selling price and the value in use.
(The amount of value in use is determined as the present value of estimated future cash flows from the
continuing use of an asset and from its disposal at the end of its useful life. For this purpose, the discount rate
(pre-tax) is determined based on the weighted average cost of capital of the company suitably adjusted for
risks specified to the estimated cash flows of the asset).
For this purpose, a cash generating unit is ascertained as the smallest identifiable company of assets that
generates cash inflows that are largely independent of the cash inflows from other assets or companys of
assets.
If recoverable amount of an asset (or cash generating unit) is estimated to be less than its carrying amount,
such deficit is recognised immediately in the Statement of Profit and Loss as impairment loss and the carrying
amount of the asset (or cash generating unit) is reduced to its recoverable amount.
When an impairment loss subsequently reverses, the carrying amount of the asset (or cash generating unit)
is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does
not exceed the carrying amount that would have been determined had no impairment loss is recognised for the
asset (or cash generating unit) in prior years. A reversal of an impairment loss is recognised immediately in the
Statement of Profit and Loss.
G. Leases
The determination of whether an agreement is, or contains, a lease is based on the substance of the agreement
at the date of inception.
Lease Accounting
As a Lessee
Finance Lease
At the commencement of the lease term, the Company recognizes finance leases as assets and liabilities in its
balance sheet at amounts equal to the fair value of the leased property or, if lower, the present value of the
minimum lease payments. The corresponding rental obligations, net of finance charges, are included in
borrowings or other financial liabilities as appropriate. The discount rate used in calculating the present value
is the interest rate implicit in the lease or the Company's incremental borrowing rate. Minimum lease payments
are apportioned between the finance charge and the reduction of the outstanding liability.
Operating Lease
Lease payments under an operating lease are recognized as an expenses on a straight-line basis over the
lease term unless either:
A. another systematic basis is more representative of the time pattern of the user's benefit; or
B. the payments are structured to increase in line with expected general inflation to compensate for the
lessor's expected inflationary cost increases.
As a Lessor
Finance Lease
Amounts due from lessees under finance leases are recorded as receivables at the Company's net investment
in the leases. Finance lease income is allocated to accounting periods so as to reflect a constant periodic rate
of return on the net investment outstanding in respect of the lease.
Operating Lease
Lease income from operating lease (excluding amount for services such as insurance and maintenance) is
recognized in the statement of profit or loss on a straight-line basis over the lease term, unless either:
A. another systematic basis is more representative of the time pattern of the user's benefit; or
B. the payments are structured to increase in line with expected general inflation to compensate for the
lessor's expected inflationary cost increases.
H. Use of Estimates and Judgements
The preparation of Financial Statements in conformity with Ind AS requires that the management of the
company makes estimates and assumptions that affect the reported amounts of income and expenses of the
period, the reported balances of assets and liabilities and the disclosures relating to contingent liabilities as of
the date of the Financial Statements. The estimates and underlying assumptions are reviewed on an ongoing
basis. Revisions to accounting estimates include useful lives of Property, Plant and Equipment, Intangible
Assets, allowance for doubtful debts/advances, future obligations in respect of retirement benefit plans, expected
cost of completion of contracts, provision for rectification costs, fair value measurement etc. Difference, if any,
between the actual results and estimates is recognised in the period in which the results are known.
I. Financial Instruments
Financial assets and/or financial liabilities are recognised when the company becomes party to a contract
embodying the related financial instruments. All financial assets, financial liabilities and financial guarantee
contracts are initially measured at transaction values and where such values are different from the fair value,
at fair value. Transaction costs that are 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 as the case may be, the fair value of such assets or liabilities, on initial recognition. Transaction
costs directly attributable to the acquisition of financial assets or financial liabilities at fair value through profit or
loss are recognised immediately in profit or loss. In case of interest free or concession loans given to
subsidiary companies, the excess of the actual amount of the loan over initial measure at fair value is
accounted as an equity investment.
Financial Assets
Classification
All recognised financial assets are subsequently measured in their entirety at amortised cost or at fair value
dependingon the classification of the financial assets as follows:
1. Investments in debt Instruments that are designated as fair value through profit or loss (FVTPL) - at fair
value.
2. Other investments in debt instruments - at amortised cost, subject to following conditions:
• The asset is held within a business model whose objective is to hold assets in order to collect
contractual cash Flows and
• The contractual terms of instrument give rise on specified dates to cash flows that are solely
payments of principal and interest on the principal amount outstanding.
3. Debt instruments that meet the following conditions are subsequently measured at fair value through
other comprehensive income (FVTOCI) (unless the same are designated as fair value through profit
or loss)
• The asset is held within a business model whose objective is achieved both by collecting contractual
cash flowsand selling financial assets; and
• The contractual terms of instrument give rise on specified dates to cash flows that are solely
payments ofprincipal and interest on the principal amount outstanding.
4. Investment in equity instruments issued by subsidiary, associates and joint ventures are measured at
cost less impairment.
5. Investment in preference shares of the subsidiary companies are treated as equity instruments if the
same are convertible into equity shares or are redeemable out of the proceeds of equity instruments
issued for the purpose of redemption of such investments. Investment in preference shares not meeting
the aforesaid conditions are classified as debt instruments at FVTPL.
6. Investments in equity instruments are classified as at FVTPL, unless the related instruments are not held
for trading and the company irrevocably elects on initial recognition to present subsequent changes in fair
value in Other Comprehensive Income.
Initial Measurement
At initial recognition, the Company measures a financial asset when it becomes a party to the contractual
provisions of the instruments and measures at its fair value except trade receivables which are initially
measured at transaction price. Transaction costs are incremental costs that are directly attributable to the
acquisition of the financial asset. Transaction costs of financial assets carried at fair value through profit or
loss are expensed in profit or loss. A regular way purchase and sale of financial assets are accounted for at
trade date.
Subsequent Measurement
- Financial assets at FVTPL
These assets are subsequently measured at fair value. Net gains including any interest or dividend
income, are recognized in profit or loss.
- Financial assets at amortized cost
These assets are subsequently measured at amortized cost using the effective interest method. The
amortized cost is reduced by impairment losses. Interest income, foreign exchange gains and losses
and impairment are recognized in profit or loss. Any gain or loss on de-recognition is recognized in profit
or loss.
For financial assets that are measured at FVTOCI, income by way of interest, dividend and exchange
difference (on debt instrument) is recognised in profit or loss and changes in fair value (other than on
account of such income) are recognised in Other Comprehensive Income and accumulated in other
equity. On disposal of debt instruments measured at FVTOCI, the cumulative gain or loss previously
accumulated in other equity is reclassified to profit or loss. In case of equity instruments measured at
FVTOCI, such cumulative gain or loss is not reclassified to profit or loss on disposal of investments.
Derecognition
A financial asset is primarily derecognised when:
1. the right to receive cash flows from the asset has expired, or
2. the company has transferred its 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 (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.
On derecognition of a financial asset in its entirety, the difference between the carrying amount measured
at the date of derecognition and the consideration received is recognised in profit or loss.
Impairment of Financial Assets
The company recognises impairment loss on trade receivables using expected credit loss model, which
involves use of a provision matrix constructed on the basis of historical credit loss experience as permitted
under Ind AS 109
Financial Liabilities
i) Classification, Subsequent Measurement and Gains and Losses
Financial liabilities, including derivatives and embedded derivatives, which are designated for measurement
at FVTPL are subsequently measured at fair value. Financial guarantee contracts are subsequently
measured at the amount of impairment loss allowance or the amount recognised at inception net of
cumulative amortisation, whichever is higher. All other financial liabilities including loans and borrowings
are measured at amortised cost using Effective Interest Rate (EIR) method.
Derecognition
The Company derecognizes a financial liability when its contractual obligations are discharged or cancelled, or
expire.The Company also derecognises a financial liability when its terms are modified and the cash flows
under the modified terms are substantially different. In this case, a new financial liability based on the modified
terms is recognised at fair value. The difference between the carrying amount of the financial liability extinguished
and the new financial liability with modified terms is recognised in the profit or loss.
J. Offsetting Financial Instruments
The financial assets and financial liabilities are offset and presented on net basis in the Balance Sheet when
there is a current legally enforceable right to set-off the recognised amounts and it is intended to either settle
on net basis or to realise the asset and settle the liability simultaneously.
K. Basis of Measurement
The financial statements have been prepared on the historical cost basis except for the following items:
L. Inventories
Inventories are measured at the lower of cost and net realisable value. The cost of inventories includes
expenditure incurred in acquiring the inventories, production or conversion costs and other costs incurred in
bringing them to their present location and condition. In the case of manufactured inventories and work-in¬
progress is valued at actual cost of production. Cost of raw materials, stores and spares are determined on
weighted average basis.Net realisable value is the estimated selling price in the ordinary course of business,
less the estimated costs of completion and selling expenses.
The net realisable value of work-in-progress is determined with reference to the selling prices of related
finished products.
Raw materials, components and other supplies held for use in the production of finished products are not
written down below cost except in cases where material prices have declined and it is estimated that the cost
of the finished products will exceed their net realisable value.The comparison of cost and net realisable value
is made on an item-by-item basis.Excess/shortages if any, arising on physical verification are absorbed in the
respective consumption accounts. Finished Goods is determined on full absorption cost basis.
M. Employee Benefits
i. Short Term Employee Benefit Obligations
Employee benefits such as salaries, wages, short term compensated absences, expected cost of
bonus, ex-gratia and performance-linked rewards falling due wholly within twelve months of rendering the
service are classified as short term employee benefits and are expensed in the period in which the
employee renders the related service.
ii. Other Long Term Employee Benefit Obligations
The obligation for long term employee benefits such as long term compensated absences, long service
award etc. is measured at present value of estimated future cash flows expected to be made by the
company and is recognised in a similar manner as in the case of defined benefit plans.
Long term employee benefit costs comprising current service cost and gains or losses on curtailments
and settlements, remeasurements including actuarial gains and losses are recognised in the Statement
of Profit and Loss as employee benefit expenses. Interest cost implicit in long term employee benefit cost
is recognised in the Statement of Profit and Loss under finance cost.
iii. Post-Employment Obligations
(A) Defined Contribution Plan:
The company's superannuation scheme, state governed provident fund scheme, employee state
insurance scheme and employee pension scheme are defined contribution plans. The contribution
paid/payable under the schemes is recognised during the period in which the employee renders the
related service.
(B) Defined Benefit Plan:
Gratuity Obligations
The Company has an obligation towards gratuity, a defined benefit retirement plan covering eligible
employees. The plan provides for a lump sum payment to vested employees at retirement, death
while in employment or on termination of employment of an amount equivalent to 15 to 30 days
salary payable for each completed year of service. Vesting occurs upon completion of five years of
service. The Company makes annual contributions to gratuity fund maintained with Life Insurance
Corporation of India. The Company accounts for the liability for gratuity benefits payable in future
based on an independent actuarial valuation.
Leave Encashment
The company provides for the encashment of leave or leave with pay subject to certain rules. The
employees are entitled to accumulated leave subject to certain limits, for future encashment. The liability
is provided based on the number of days of unutilized leave at each balance sheet date. The Company
makes contributions to leave encashment fund maintained with Life Insurance Corporation of India. The
Company accounts for the liability for benefits payable in future based on an independent actuarial
valuation.
Provident Fund
The eligible employees of the Company are entitled to receive benefits under the provident fund, a defined
contribution plan, in which both employees and the company make monthly contribution at a specified
percentage of the covered employees' salary. The contributions as specified under the law are paid to
the provident fund and pension fund to respective Regional Provident Fund Commissioner and the
Central Provident Fund under the State Pension Scheme.
The obligation is measured at the present value of the estimated future cash flows using a discount rate
based on the market yield on government securities of a maturity period equivalent to the weighted
average maturity profile of the defined benefit obligations at the Balance Sheet date.
Remeasurement, comprising actuarial gains and losses, the return on plan assets (excluding amounts
included in net interest on the net defined benefit liability or asset) and any change in the effect of asset
ceiling (wherever applicable) is recognised in other comprehensive income and is reflected in retained
earnings and the same is not eligible to be reclassified to profit or loss.
Defined benefit employee costs comprising current service cost, past service cost and gains or losses
on settlements are recognised in the Statement of Profit and Loss as employee benefits expense.
Interest cost implicit in defined benefit employee cost is recognised in the Statement of Profit and Loss
under finance cost. Gains or losses on settlement of any defined benefit plan are recognised in profit or
loss when such settlement occurs. Past service cost is recognised as expense at the earlier of the plan
amendment or curtailment and when the company recognises related restructuring costs or termination
benefits.
In case of funded plans, the fair value of the plan assets is reduced from the gross obligation under the
defined benefit plans to recognise the obligation on a net basis.
iv. Termination Benefits
Termination benefits such as compensation under employee separation schemes are recognised as
expense when the company's offer of the termination benefit is accepted or when the company recognises
the related restructuring costs whichever is earlier.
N. Foreign Currency Transactions
The functional currency and presentation currency of the company is Indian Rupee.
Transactions in foreign currencies are translated into the functional currency of the Company at exchange
rates at the date of transactions or an average rate if the average rate approximates the actual rate at the date
of transaction.Transactions in currencies other than the company's functional currency are recorded on initial
recognition using the exchange rate at the transaction date. At each Balance Sheet date, foreign currency
monetary items are reported using the closing rate. Non-monetary items that are measured in terms of
historical cost in foreign currency are not retranslated. Exchange differences that arise on settlement of
monetary items or on reporting of monetary items at each Balance Sheet date at the closing spot rate are
recognised in profit or loss in the period in which they arise except for:
A. exchange differences on foreign currency borrowings relating to assets under construction for future
productive use, which are included in the cost of those assets when they are regarded as an adjustment
to interest costs on those foreign currency borrowings; and
B. exchange differences on transactions entered into in order to hedge certain foreign currency risks.
Financial statements of foreign operations whose functional currency is different than Indian Rupee are
translated into Indian Rupees as follows:
A. assets and liabilities for each Balance Sheet presented are translated at the closing rate at the date of that
Balance Sheet;
B. income and expenses for each income statement are translated at average exchange rates; and
C. all resulting exchange differences are recognised in other comprehensive income and accumulated in
equity as foreign currency translation reserve for subsequent reclassification to profit or loss on disposal
of such foreign operations.
O. Revenue from Contract With Customer
Ind AS 115 was issued on 28 March, 2018 and supersedes Ind AS 11 Construction Contracts and Ind AS 18
Revenue and it applies, with limited exceptions, to all revenue arising from contracts with its customers. Ind AS
115 establishes a five-step model to account for revenue arising from contracts with customers and requires
that revenue be recognised at an amount that reflects the consideration to which an entity expects to be
entitled in exchange for transferring goods or services to a customer.
Ind AS 115 requires entities to exercise judgement, taking into consideration all of the relevant facts and
circumstances when applying each step of the model to contracts with their customers. The company adopted
Ind AS 115 using the modified retrospective method of adoption with the date of initial application of 1 April,
2018. Under this method, the standard can be applied either to all contracts at the date of initial application or
only to contracts that are not completed at this date. The compnay elected to apply the standard to all contracts
as at 1 April, 2018. However, the application of Ind AS 115 does not have any significant impact on the
recognition and measurement of revenue and related items.
(A) Sale of Goods
Revenue from sale of goods is recognised at the point in time when control of the goods is transferred to
the customer. The normal credit term is 1 to 180 days upon delivery. The revenue is measured on the
basis of the consideration defined in the contract with a customer, including variable consideration, such
as discounts, volume rebates, or other contractual reductions. As the period between the date on which
the company transfers the promised goods to the customer and the date on which the customer pays for
these goods is generally one year or less, no financing components are taken into account. The company
considers whether there are other promises in the contract that are separate performance obligations to
which a portion of the transaction price needs to be allocated.
(B) Rendering of Services
Revenue from services rendered is recognised as the services are rendered and is booked based on
agreements/arrangements with the concerned parties.
(C) Other Income
Export entitlements (arising out of Duty Drawback, Merchandise Export from India) are recognised when
the right to receive credit as per the terms of the schemes is established in respect of the exports made
and where there is no significant uncertainty regarding the ultimate collection of the relevant export
proceeds. Operating revenues of subsidiaries are considered to be operating revenues in the consolidated
financial statements.
P. Taxation
Income tax comprises current and deferred tax. It is recognised in profit or loss except to the extent that it
relates to a business combination or to an item recognised directly in equity or in other comprehensive income.
Income Tax
Current tax comprises the expected tax payable or receivable on the taxable income or loss for the year and
any adjustment to the tax payable or receivable in respect of previous years. The amount of current tax
reflects the best estimate of the tax amount expected to be paid or received after considering the uncertainty,
if any, related to income taxes. It is measured using tax rates (and tax laws) enacted or substantively enacted
by the reporting date. Current tax assets and current tax liabilities are offset only if there is a legally enforceable
right to set off the recognised amounts, and it is intended to realise the asset and settle the liability on a net
basis or simultaneously.
Deferred Taxes
Deferred tax is recognised on temporary differences between the carrying amounts of assets and liabilities in
the company's financial statements and the corresponding tax bases used in computation of taxable profit and
quantified using the tax rates and laws enacted or substantively enacted as on the Balance Sheet date.
Deferred tax liabilities are generally recognised for all taxable temporary differences including the temporary
differences associated with investments in subsidiaries and associates, and interests in joint ventures, except
where the company is able to control the reversal of the temporary difference and it is probable that the
temporary difference will not reverse in the foreseeable future.
Deferred tax assets are generally recognised for all taxable temporary differences to the extent that is
probable that taxable profits will be available against which those deductible temporary differences can be
utilised. 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.
Deferred tax assets relating to unabsorbed depreciation/business losses/losses under the head “capital
gains” are recognised and carried forward to the extent of available taxable temporary differences or where
there is convincing other evidence that sufficient future taxable income will be available against which such
deferred tax assets can be realised.
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 reporting period, to recover or settle the carrying
amount of its assets and liabilities.
Transaction or event which is recognised outside profit or loss, either in other comprehensive income or in
equity, is recorded along with the tax as applicable.
|