Note 1 Company Overview
Arunis Abode Limited (hereinafter referred to as "the company") is a public company domiciled in India and is
incorporated under the provisions of the Companies Act, 1956 having a CIN: L70100GJ1994PLC021759 (old CIN
L65910GJ1994PTC021759). Equity shares are listed on Bombay Stock Exchange (BSE).
The Management of the Company has changed its main object to undertake Real Estate Business and dealing in
commodities as per Resolution dated 27th May, 2020. The company has filed prescribed documents with the Registrar of
Companies. Earlier the Company was engaged in business of Stock and Securities Trading and Investment. Certificate
of Incorporation pursuant to change of Name of the company issued by Ministry of Corporate Affairs on November 09,
2020.
The Registered office of the company is situated at "Desai House", Survey No: 2523, Coastal Highway, Umersadi, Killa
Pardi, Valsad, Gujarat - 396 125.
Note 2 Basis of preparation of financial statements
a. Basis of preparation and compliance with Ind AS
The financial statements of the Company as at and for the year ended March 31, 2025 have been prepared in
accordance with Indian Accounting standards ('Ind AS') notified under section 133 of the Companies Act, 2013
('Act') and the Companies (Indian Accounting Standards) Rules issued from time to time and relevant provisions
of the Companies Act, 2013 (collectively called as Ind AS).
b. Basis of measurement
The standalone financial statements have been prepared on a historical cost basis, except for fair value through
other comprehensive income (FVOCI) instruments, derivative financial instruments, other financial assets held for
trading and financial assets and liabilities designated at fair value through profit or loss (FVTPL), all of which have
been measured at fair value.
c. Functional and presentation currency
The financial statements are prepared in Indian Rupees, which is the Company's functional and presentation
currency. All financial information presented in has been converted to in rupees in thousands.
d. Current and non-current classification
The Company presents assets and liabilities in the Balance Sheet based on current / non-current classification.
An asset is classified as current if it satisfies any of the following criteria:
a) It is expected to be realised or intended to sale or consumed within the normal operating cycle,
b) It is held primarily for the purpose of trading,
c) It is expected to be realised within twelve months after the reporting period, or
d) It is a cash or cash equivalent unless restricted from being exchanged or used to settle a liability for at least
twelve months after the reporting period.
All other assets are classified as non-current.
A liability is classified as current if it satisfies any of the following criteria:
a) it is expected to be settled in the Company's normal operating cycle,
b) it is held primarily for the purpose of trading,
c) it is due to be settled within twelve months after the reporting period,
d) there is no unconditional right to defer the settlement of the liability for at least twelve months after the
reporting period.
The Company classifies all other liabilities as non-current. Current liabilities include current portion of non-current
financial liabilities. Deferred tax assets and liabilities are classified as non-current assets and liabilities.
The standalone financial statements for the year ended March 31, 2025 are being authorised for issue in
accordance with a resolution of the Board of Directors passed on May 14, 2025.
The Company has applied the following accounting policies in the preparation of financial statements.
2.1 Revenue recognition
Revenue (other than for those items to which Ind AS 109 is applicable) is measured at fair value of the consideration
received or receivable. Ind AS 115, Revenue from contracts with customers, outlines a single comprehensive model of
accounting for revenue arising from contracts with customers.
The Company recognises revenue from contracts with customers based on a five-step model as set out in Ind AS 115:
Step 1: Identify contract(s) with a customer: A contract is defined as an agreement between two or more parties that
creates enforceable rights and obligations and sets out the criteria for every contract that must be met.
Step 2: Identify performance obligations in the contract: A performance obligation is a promise in a contract with a
customer to transfer a good or service to the customer.
Step 3: Determine the transaction price: The transaction price is the amount of consideration to which the Company
expects to be entitled in exchange for transferring promised goods or services to a customer, excluding amounts
collected on behalf of third parties.
Step 4: Allocate the transaction price to the performance obligations in the contract: For a contract that has more than
one performance obligation, the Company allocates the transaction price to each performance obligation in an amount
that depicts the amount of consideration to which the Company expects to be entitled in exchange for satisfying each
performance obligation.
Step 5: Recognise revenue when (or as) the Company satisfies a performance obligation.
The Company recognises revenue from consultancy provided for real-estate projects. Interest income is recognized
using the effective interest rate method. Dividend income is recognised when the right to receive payment of the
dividend is established, and it is probable that the economic benefits associated with the dividend will flow to the
Company and the amount of the dividend can be measured reliably.
2.2 Operating Segments
Segments have been identified in accordance with Ind AS 108 on Operating Segments considering the risk or return
profiles of the business. As required under Ind AS 108, the Chief Operating Decision Maker (CODM) evaluates the
performance and allocates resources based on analysis of various performance indicators. Accordingly, information
has been presented for the operating segments and the Company has identified business segment as primary segment.
The reportable segments are real estate consultancy and the trading in securities.
2.3 nvestment in subsidiaries
Investment in subsidiaries is carried at cost in the separate financial statements.
2.4 Property, plant and equipment
Property, plant and equipment are stated at acquisition cost less accumulated depreciation and accumulated
impairment losses, if any. Subsequent costs are included in the asset's carrying amount. Items of property, plant and
equipment are initially recorded at cost.
Cost comprises acquisition cost, borrowing cost if capitalization criteria are met, and directly attributable cost of
bringing the asset to its working condition for the intended use. Subsequent expenditure relating to property, plant and
equipment is capitalized only when it is probable that future economic benefit associated with these will flow with the
Company and the cost of the item can be measured reliably. Items of Property, plant and equipment that have been
retired from active use and are held for disposal are stated at the lower of their net book value or net realisable value
and are shown separately in the financial statements, if any.
Depreciation methods, estimated useful lives and residual value
Depreciation on Property, plant and equipment is provided on Straight Line Method at the rates prescribed in Schedule
II to the Company's Act, 2012. Depreciation on additions to Property, plant and equipment and assets disposed-of /
discarded is charged on pro-rata basis.
The useful lives have been determined based on technical valuation done by the management's expert which are higher
than those specified by Schedule II to the Companies Act; 2013, in order to reflect the actual usage of the assets. The
residual values are not more than 5% of the original cost of the asset.
The assets' residual values and useful lives are reviewed and adjusted if appropriate, at the end of each reporting period.
An asset's carrying amount is written down immediately to its recoverable amount if the asset's carrying amount is
greater than its estimated recoverable amount.
De-recognition:
The carrying amount of an item of property, plant and equipment is derecognized on disposal or when no future
economic benefits are expected from its use. Gains or losses arising from de-recognition, disposal or retirement of
an item of property, plant and equipment are measured as the difference between the net disposal proceeds and the
carrying amount of the asset and are recognised net, within "Other Income" or "Other Expenses", as the case maybe, in
the Statement of Profit and Loss in the year of de-recognition.
2.5 Borrowing costs
Borrowing costs are expensed in the period in which they occur. Borrowing costs consist of interest and other costs
that an entity incurs in connection with the borrowing of funds.
2.6 Investment in equity shares and securities for trade
Investment in equity shares which were regularly traded on stock exchange are considered to be securities for trade.
2.7 Financial instruments
Recognition and initial Measurement
The Company recognizes all the financial assets and liabilities at its fair value on initial recognition; In the case of
financial assets not valued at fair value through profit or loss, transaction costs that are directly attributable to the
acquisition or issue of the financial asset are added to the fair value on initial recognition. The financial assets are
accounted on a trade date basis.
Classification and subsequent measurement of financial asset or financial liability: For subsequent measurement,
financial assets are categorised into:
a. Amortised cost: The Company classifies the financial assets at amortised cost if the contractual cash flows
represent solely payments of principal and interest on the principal amount outstanding and the assets are held
under a business model to collect contractual cash flows. The gains and losses resulting from fluctuations in fair
value are not recognised for financial assets classified in this category.
b. Fair value through other comprehensive income (FVOCI): The Company classifies the financial assets as
FVOCI if the contractual cash flows represent solely payments of principal and interest on the principal amount
outstanding and the Company's business model is achieved by both collecting contractual cash flow and selling
financial assets. In case of debt instruments measured at FVOCI, changes in fair value are recognised in other
comprehensive income.
The impairment gains or losses, foreign exchange gains or losses and interest calculated using the effective interest
method are recognised in profit or loss. On de-recognition, the cumulative gain or loss previously recognised in
other comprehensive income is re-classified from equity to profit or loss as a reclassification adjustment. In case
of equity instruments irrevocably designated at FVOCI, gains / losses including relating to foreign exchange, are
recognised through other comprehensive income. Further, cumulative gains or losses previously recognised in
other comprehensive income remain permanently in equity and are not subsequently transferred to profit or loss
on de-recognition.
c. Fair value through profit or loss (FVTPL): The financial assets are classified as FVTPL if these do not meet the
criteria for classifying at amortised cost or FVOCI. Further, in certain cases to eliminate or significantly reduce a
measurement or recognition inconsistency (accounting mismatch), the Company irrevocably designates certain
financial instruments at FVTPL at initial recognition. In case of financial assets measured at FVTPL, changes in
fair value are recognised in profit or loss.
Profit or loss on sale of investments is determined on the basis of first-in-first-out (FIFO) basis.
Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction
between market participants at the measurement date. The fair value measurement is based on the presumption
that the transaction to sell the asset or transfer the liability takes place either:
- In the principal market for the asset or liability, or
- In the absence of a principal market, in the most advantageous market for the asset or liability.
The principal or the most advantageous market must be accessible by the Company.
The fair value of an asset or a liability is measured using the assumptions that market participants would use
when pricing the asset or liability, assuming that market participants act in their best economic interest.
A fair value measurement of a non-financial asset takes into account a market participant's ability to generate
economic benefits by using the asset in its highest and best use or by selling it to another market participant that
would use the asset in its highest and best use.
In order to show how fair values have been derived, financial instruments are classified based on a hierarchy of
valuation techniques, as summarised below:
Level 1 financial instruments: Those where the inputs used in the valuation are unadjusted quoted prices from
active markets for identical assets or liabilities that the Company has access to at the measurement date. The
Company considers markets as active only if there are sufficient trading activities with regards to the volume and
liquidity of the identical assets or liabilities and when there are binding and exercisable price quotes available on
the balance sheet date.
Level 2 financial instruments: Those where the inputs that are used for valuation and are significant, are derived
from directly or indirectly observable market data available over the entire period of the instrument's life.
Level 3 financial instruments: Those that include one or more unobservable input that is significant to the
measurement as whole.
Based on the Company's business model for managing the investments, the Company has classified its securities
for trade at FVTPL.
Financial liabilities are carried at amortised cost using the effective interest rate method. For trade and other
payables, the carrying amount approximates the fair value due to short maturity of these instruments.
d. De-recognition: The Company derecognises a financial asset when the contractual rights to the cash flows
from the financial asset expire, or it transfers the rights to receive the contractual cash flows in a transaction in
which substantially all of the risks and rewards of ownership of the financial asset are transferred or in which the
Company neither transfers nor retains substantially all of the risks and rewards of ownership and does not retain
control of the financial asset. The Company derecognises a financial liability when its contractual obligations are
discharged or cancelled or expired.
e. Impairment of financial assets: In accordance with Ind AS 109, the Company applies expected credit loss model
(ECL) for measurement and recognition of impairment loss. The Company recognises lifetime expected losses for
all contract assets and / or all trade receivables that do not constitute a financing transaction. At each reporting
date, the Company assesses whether the loans have been impaired. The Company is exposed to credit risk
when the customer defaults on his contractual obligations. For the computation of ECL, the loan receivables are
classified into three stages based on the default and the aging of the outstanding. If the amount of an impairment
loss decreases in a subsequent period, and the decrease can be related objectively to an event occurring after
the impairment was recognised, the excess is written back by reducing the loan impairment allowance account
accordingly. The write-back is recognised in the statement of profit and loss.
The Company recognises lifetime expected credit loss for trade receivables and has adopted the simplified
method of computation as per Ind AS 109. The Company considers outstanding overdue for more than 90 days
for calculation of expected credit loss. A financial asset is written off when there is no reasonable expectation of
recovering the contractual cash flows.
2.8 Cash and cash equivalents
Cash and cash equivalent 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 consist of cash and short-term deposits, as defined above.
|