1. Basis of preparation:
The summary financial information has been prepared by applying necessary adjustments to the financial
statements (‘financial statements’) of the Company. The financial statements of the Company have been prepared
in accordance with the Generally Accepted Accounting Principles in India (Indian GAAP) to comply with the
accounting standards specified under section 133 of the Companies Act, 2013, of the Companies (Accounts)
Rules, 2014 and the relevant provisions of the Companies Act, 2013 ("the 2013 Act"), as applicable and Securities
and Exchange Board of India (Issue of Capital and Disclosure Requirements) regulations 2018, as amended (the
"Regulations"). The financial statements have been prepared on accrual basis under the historical cost convention.
The accounting policies adopted in the preparation of the financial statements are consistently applied.
2. Use of Estimates
The preparation of the financial statements in conformity with Generally Accepted Accounting Principles requires
the Management to make estimates and assumptions that affect the reported balances of assets and liabilities and
disclosures relating to contingent assets and liabilities as at the date of the financial statements and the reported
amounts of income and expenses during the year. Examples of such estimates include provisions for doubtful
debts, income taxes, post-sales customer support and the useful lives of Property Plant and equipment and
intangible assets.
3. Current versus non-current classification:
The Company presents assets and liabilities in the Balance Sheet based on current/non-current classification.
a) An asset is current when it is:
• Expected to be realized or intended to be sold or consumed in the normal operating cycle,
• Held primarily for the purpose of trading,
• Expected to be realised within twelve months after the reporting period, or
• 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.
b) A liability is current when:
• It is expected to be settled in the normal operating cycle,
• It is held primarily for the purpose of trading,
• It is due to be settled within twelve months after the reporting period, or
• There is no unconditional right to defer the settlement of the liability for at least twelve months
after the reporting period.
All other liabilities are classified as non-current.
c) Deferred tax assets and liabilities are classified as non-current assets and liabilities.
d) The operating cycle is the time between the acquisition of assets for processing and their realization
in cash and cash equivalents.
4. Revenue recognition:
Revenue is recognized to the extent that it is probable that the economic benefits will flow to the Company and
the revenue can be reliably measured in accordance with AS-9, Revenue Recognition. Sales are recognized on
accrual basis, and only after transfer of goods to the customer.
5. Other Income:
Other items of income and expenditure are recognized on accrual basis and as a going concern basis, and the
accounting policies are consistent with the generally accepted accounting policies.
6. Property Plant and Equipment including Intangible assets:
Property Plant and Equipments are stated at cost, less accumulated depreciation. Cost includes cost of acquisition
including material cost, freight, installation cost, duties and taxes, and other incidental expenses, incurred up to
the installation stage, related to such acquisition. Intangible assets that are acquired by the Company are measured
initially at cost. After initial recognition, an intangible asset is carried at its cost less any accumulated amortisation
and any accumulated impairment loss.
7. Depreciation & Amortization:
The Company has applied the estimated useful lives as specified in Schedule II of the Companies Act 2013 and
calculated the depreciation as per the Straight-Line Method. Depreciation on new assets acquired during the year
is provided at the rates applicable from the date of acquisition to the end of the financial year. In respect of the
assets sold during the year, depreciation is provided from the beginning of the year till the date of its disposal.
Intangible assets are amortized on a straight-line basis over the estimated useful life as specified in Schedule II of
the Companies Act 2013. The amortization expense on intangible assets with finite lives is recognized in the
statement of profit and loss. In respect of the assets sold during the year, amortization is provided from the
beginning of the year till the date of its disposal.
The estimated useful lives of assets are as follows:
Category Useful life
Computer & Laptop 3 years
Furniture & Fittings 10 years
Office Equipment 10 years
Plant & Machinery 20 years
Building 30 years
8. Impairment of assets:
The Management periodically assesses using, external and internal sources, whether there is an indication that an
asset may be impaired. An impairment loss is recognised wherever the carrying value of an asset exceeds its
recoverable amount. The recoverable amount is higher of the asset's net selling price and value in use, which
means the present value of future cash flows expected to arise from the continuing use of the asset and its eventual
disposal. Reversal of impairment loss is recognised immediately as income in the profit and loss account.
9. Employee Benefits:
The company provides for the various benefits plans to the employees. These are categorised into Defined Benefits
Plans and Defined Contributions Plans. Defined contribution plans includes the amount paid by the company
towards the liability for the Provident fund to the employee’s provident fund organization and Employee State
Insurance fund in respect of ESI and defined benefits plans includes the retirement benefits, such as Leave
Encashment.
Liabilities for short term employee benefits are measured at an undiscounted amount of the benefits expected to
be paid and charged to Statement of Profit & Loss in the year in which the related service is rendered.
Contributions to secure retiral benefits in respect of provident fund, based on applicable rules/status, are charges
to revenue.
Gratuity:
In accordance with the Payment of Gratuity Act, 1972, the Company provides for gratuity; a defined benefit
retirement plan covering eligible employees. The plan provides for lump sum payment to vested employees at
retirement, death, incapacitation or termination of employment, of an amount equivalent to 15 days (15/26) salary
payable to the respective employee's salary for each completed year of service, with a maximum of 20,00,000.
Liabilities with regards to the plan are determined by actuarial valuation at each balance sheet date using the
projected unit cost method. The Company recognizes the net obligation of the gratuity plan in the balance sheet
as an asset or liability, respectively in accordance with Accounting Standard 15 (AS-15 Revised), "Employee
benefits".
10. Taxes on Income:
Income Tax expense is accounted for in accordance with AS-22 "Accounting for Taxes on Income" for both
Current Tax and Deferred Tax stated below:
A. Current Tax:
Provision for current tax is made in accordance with the provisions of the Income Tax Act, 1961.
B. Deferred Tax:
Deferred tax is recognised, subject to the consideration of prudence, as the tax effect of timing difference between
the taxable income and accounting income computed for the current accounting year using the tax rates and tax
laws that have been enacted or substantially enacted by the balance sheet date.
Deferred tax assets are recognised and carried forward to the extent that there is a reasonable certainty, except
arising from unabsorbed depreciation and carried forward losses, that sufficient future taxable income will be
available against which such deferred tax assets can be realised.
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