2 MATERIAL ACCOUNTING POLICIES:

This note provides a list of the significant accounting
policies adopted in the preparation of these

standalone Ind AS financial statements. Accounting
policies have been consistently applied except where
a newly issued Indian Accounting Standard is initially
adopted or a revision to an existing Indian Accounting
Standard requires a change in the accounting policy
hitherto in use.

2.1 Basis of preparation

Statement of compliance

These financial statements are prepared in
accordance with Indian Accounting Standards (Ind
AS) and the provisions of the Companies Act, 2013 ('the
Act') (to the extent notified). The Ind AS are prescribed
under Section 133 of the Act read with Rule 3 of the
Companies (Indian Accounting Standards) Rules,
2015 and Companies (Indian Accounting Standards)
Amendment Rules, 2016.

The standalone Ind AS financial statements are
presented in Indian Rupees (?) which is also the
Company's functional currency and all amounts
have been rounded off to the nearest Million, unless
otherwise stated.

Basis for Preparation

The standalone financial statements have been
prepared on the historical cost basis, except for the
following:

i. Certain financial assets and liabilities that are
qualified to be measured at fair value (refer
accounting policy on financial instruments),

ii. Defined benefit and other long-term employee
benefits where plan asset is measured at fair
value less present value of defined benefit
obligations (“DBO”) and

iii. Expenses relating to share based payments are
measured at fair value on the date of grant.

Historical cost is generally based on the fair value of
the consideration given in exchange for the goods
and services.

Going Concern

The directors have, at the time of approving the
standalone financial statements, a reasonable
expectation that the Company has adequate
resources to continue in operational existence for the
foreseeable future. Thus, they continue to adopt the
going concern basis of accounting in preparing the
standalone financial statements.

2.2 Use of estimates and judgements

The preparation of the financial statements in
conformity with Ind AS requires management to
make judgements, estimates and assumptions that
affect the application of accounting policies and
the reported amounts of assets, liabilities, income
and expenses. Actual results may differ from these
estimates.

Estimates and underlying assumptions are reviewed
on a periodic basis. Revisions to accounting estimates
are recognised in the period in which the estimates
are revised and in any future periods affected. In
particular, information about significant areas of
estimation, uncertainty and critical judgements in
applying accounting policies that have the most
significant effect on the amounts recognised in the
financial statements is included in the following notes:

i. Contingent liabilities: Contingent liabilities are
not recognised in the financial statements but
are disclosed in the notes. They are assessed
continually to determine whether an outflow of
resources embodying economic benefits has
become probable. If it becomes probable that
an outflow of future economic benefits will be
required for an item previously dealt with as a
contingent liability, a provision is recognised in
the financial statements of the period in which
the change in probability occurs (except in the
extremely rare circumstances where no reliable
estimate can be made).

ii. Income taxes: Significant judgments are involved
in determining provision for income taxes,
including (a) the amounts claimed for certain
deductions under the Income Tax Act, 1961 and
(b) the amount expected to be paid or recovered
in connection with uncertain tax positions.

The ultimate realisation of deferred income tax
assets is dependent upon the generation of
future taxable income during the periods in which
the temporary differences become deductible.
Management considers the scheduled reversals
of deferred tax liabilities and the projected future
taxable income in making this assessment.
Based on the level of historical taxable income
and projections for futuretaxable income over
the periods in which the deferred income tax
assets are deductible, management believes
that the Company will realise the benefits of
those deductible differences. The amount of the

deferred income tax assets considered realisable,
however, could be reduced in the near term if
estimates of future taxable income during the
carry forward periods are reduced. (Refer note 40)

iii. Impairment of financial assets: The Company
recognises loss allowances using the Expected
credit loss (ECL) model for the financial assets
which are not fair valued through profit or loss.
Loss allowance for trade receivables (billed
and unbilled) with no significant financing
component is measured at an amount equal
to lifetime ECL. For all other financial assets,
expected credit losses are measured at an
amount equal to the 12-month ECL, unless
there has been a significant increase in credit
risk from initial recognition in which case those
are measured at lifetime ECL. The loss rates for
the trade receivables considers past collection
history from the customers, the credit risk of the
customers and have been adjusted to reflect the
Management's view of economic conditions over
the expected collection period of the receivables
(billed and unbilled). (Refer note 42))

iv. Impairment of non-financial assets: Non¬
financial assets are tested for impairment
by determining the recoverable amount.
Determination of recoverable amount is based
on value in use, which is present value of future
cash flows. The key inputs used in the present
value calculations include the expected future
growth in operating revenues and margins in
the forecast period, long-term growth rates and
discount rates which are subject to significant
judgement.

v. Measurement of defined benefit obligations: For

defined benefit obligations, the cost of providing
benefits is determined based on actuarial
valuation. An actuarial valuation is based on
significant assumptions which are reviewed on a
yearly basis. (Refer note 36).

vi. Property, plant and equipment: The useful lives
of property, plant and equipment and intangible
assets are determined by the management at the
time the asset is acquired and reviewed periodically.
Ind AS 103 requires the identifiable intangible
assets acquired in business combinations to be
fair valued and significant estimates are required
to be made in determining the value of intangible
assets. These valuations are conducted by external
experts. (Refer note 3(a))

vii. Other estimates: The preparation of financial
statements involves estimates and assumptions
that affect the reported amount of assets,
liabilities, disclosure of contingent liabilities
at the date of financial statements and the
reported amount of revenues and expenses for
the reporting period. Specifically, the Company
estimates the probability of collection of
accounts receivable by analyzing historical
payment patterns, customer concentrations,
customer creditworthiness and current
economic trends. If the financial condition of a
customer deteriorates, additional allowances
may be required.

2.3 Measurement of Fair Value

Some of the Company's accounting policies and
disclosures require the measurement of fair values, for
both financial and nonfinancial assets and liabilities.

Fair values are categorised into different levels in a
fair value hierarchy based on the inputs used in the
valuation techniques as follows:

- Level 1: quoted prices (unadjusted) in active markets
for identical assets or liabilities.

- Level 2: inputs other than quoted prices included in
Level 1 that are observable for the asset or liability,
either directly (i.e. as prices) or indirectly (i.e. derived
from prices).

- Level 3: inputs for the asset or liability that are not
based on observable market data (unobservable
inputs).

When measuring the fair value of an asset or a liability,
the Company uses observable market data as far as
possible. If the inputs used to measure the fair value
of an asset or a liability fall into different levels of the
fair value hierarchy, then the fair value measurement
is categorised in its entirety in the same level of the
fair value hierarchy as the lowest level input that is
significant to the entire measurement.

2.4 Current and non-current classification

Current and non-current classification: The Company
presents assets and liabilities in the balance sheet
based on current/ non-current classification. An asset
is treated as current when it is:

• Expected to be realised or intended to be sold or
consumed in 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.
A liability is current when:

• It is expected to be settled in 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 The terms
of the liability that could, at the option of the
counterparty, result in its settlement by the
issue of equity instruments do not affect its
classification. The Company classifies all other
liabilities as non-current. Deferred tax assets and
liabilities are classified as noncurrent assets and
liabilities.

Operating cycle for the business activities of the
Company covers the duration of the specific project
or contract and extends up to the realisation of
receivables within the agreed credit period normally
applicable to the respective lines of business. Based
on the nature of services rendered to customers
and time elapsed between deployment of resources
and the realisation in cash and cash equivalents of
the consideration for such services rendered, the
Company has considered an operating cycle of 12
months except for Training and skill development
business. For Training and skill development business,
the duration of operating cycle has been concluded as
15 - 18 months, depending on the projects, considering
the time from mobilisation of candidates till funds are
released by relevant government authorities.

2.5 Business Combinations

(i) Business combinations (common control
business combinations): Business combination
involving entities that are controlled by the
Company are accounted for using the pooling of
interest method as follows:

The assets and liabilities of the combining
entities are reflected at their carrying amounts.
No adjustments are made to reflect fair values,

or recognise any new assets or liabilities.
Adjustments are only made to harmonise
accounting policies.

The financial information in the standalone
financial statements in respect of prior periods
is restated as if the business combination had
occurred from the beginning of the preceding
period in the financial statements, irrespective
of the actual date of the combination. However,
where the business combination had occurred
after that date, the prior period information
is restated only from that date. The balance
of the retained earnings appearing in the
standalone financial statements of the transferor
is aggregated with the corresponding balance
appearing in the standalone financial statements
of the transferee or is adjusted against general
reserve. The identity of the reserve are preserved
and the reserves of the transferor becomes the
reserves of the transferee. The difference, if any,
between the amounts recorded as share capital
issued plus any additional consideration in the
form of cash or other assets and the amount of
share capital of the transferor is transferred to
capital reserve and is presented separately from
other capital reserves.

(ii) Business combination (other than common
control business combinations):

In accordance with Ind AS 103, the Company
accounts for the business combinations (other
than common control business combinations)
using acquisition method when control is
transferred to the Company. The cost of
acquisition is measured as the fair value of the
assets given, equity instruments issued and
liabilites incurred or assumed at the date of
exchange. The cost of acquisition also includes
the fair value of any contingent consideration.
Identifiable assets acquired and liabilities and
contingent liabilities assumed in a business
combination are measured initially at their fair
value on the date of acquisition. Transaction
costs are expensed as incurred, except to the
extent related to the issue of debt or equity
securities.

Contingent consideration

Ind AS 103 requires contingent consideration to be
fair valued in order to ascertain the net fair value
of identifiable assets, liabilities and contingent

liabilities of the acquiree. Significant estimates
are required to be made in determining the value
of contingent consideration. This valuation is
conducted by external valuation expert.

2.6 Property, plant and equipment

(I) Recognition and measurement: Property, plant
and equipment are measured at cost less
accumulated depreciation and impairment
losses, if any. Costs directly attributable to
acquisition are capitalised until the property, plant
and equipment are ready for use, as intended
by the management. Subsequent expenditures
relating to property, plant and equipment is
capitalised only when it is probable that future
economic benefits associated with these will flow
to the Company and the cost of the item can
be measured reliably. Repairs and maintenance
costs are recognised in the statement of profit
and loss when incurred. Advances paid towards
the acquisition of property, plant and equipment
outstanding at each reporting date is classified
as capital advances under other noncurrent
assets and the cost of the assets not ready for
intended use are disclosed under 'Capital work-
inprogress.

(II) Depreciation: The Company depreciates
property, plant and equipment over their
estimated useful lives using the straight-line
method. The estimated useful lives of assets are
as follows:

Depreciation methods, useful lives and residual
values are reviewed periodically, including at
each financial year end. The useful lives are based
on historical experience with similar assets as
well as anticipation of future events, which may
impact their life, such as changes in technology.
If significant parts of an item of property, plant
and equipment have different useful lives, then
they are accounted for as separate items (major
components) of property, plant and equipment.
Leasehold improvements are depreciated over

lease term or estimated useful life whichever
is lower. The residual values, useful lives and
methods of depreciation of property, plant and
equipment are reviewed periodically, including at
each financial year end.

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 the asset. The gain or loss
arising on the disposal or retirement of an asset
is determined as the difference between the
net disposal proceeds and the carrying amount
of the asset and is recognised in profit or loss.
The cost and related accumulated depreciation
are derecognised from the financial statements
upon sale or retirement of the asset and the
resultant gains or losses are recognised in the
statement of profit and loss.

2.7 Intangible Assets

(i) Recognition and measurement Internally
generated: Research and development Research
costs are expensed as incurred. Software product
development costs are expensed as incurred
unless technical and commercial feasibility of
the project is demonstrated, future economic
benefits are probable, the Company has an
intention and ability to complete and use or sell
the software and the costs can be measured
reliably. The costs which can be capitalised
include the cost of material, direct labour,
overhead costs that are directly attributable
to preparing the asset for its intended use.
Separately acquired Intangible assets: I ntangible
assets with finite useful lives that are acquired
separately are carried at cost less accumulated
amortisation and accumulated impairment
losses. Intangible assets acquired in a business
combination: Intangible assets acquired in a
business combination and recognised separately
from goodwill are recognised initially at their fair
value at the acquisition date (which is regarded
as their cost).

Others: Other purchased intangible assets
are initially measured at cost. Subsequently,
such intangible assets are measured at cost
less accumulated amortisation and any
accumulated impairment losses.

(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 expenditure,
including expenditure on internally generated
software is recognised in the statement of profit
and loss as and when incurred.

(iii) Amortisation: Intangible assets are amortised
over their respective individual estimated useful
lives on a straight-line basis, from the date that
they are available for use. The estimated useful
life of an identifiable intangible asset is based
on a number of factors including the effects of
obsolescence, demand, competition, and other
economic factors (such as the stability of the
industry, and known technological advances),
and the level of maintenance expenditures
required to obtain the expected future cash flows
from the asset. Amortisation methods and useful
lives are reviewed periodically including at each
financial year end. The amortisation expense on
intangible assets with finite lives is recognised
in the statement of profit and loss unless such
expenditure forms part of carrying value of
another asset. The estimated useful lives of
intangible assets are as follows:

An intangible asset is derecognised on disposal,
or when no future economic benefits are
expected from use or disposal. Gains or losses
arising from derecognition of an intangible asset,
measured as the difference between the net
disposal proceeds and the carrying amount of
the asset, are recognised in profit or loss when
the asset is derecognised.

2.8 Impairment of intangible assets and property, plant
and equipment

Intangible assets and property, plant and equipment
are evaluated for recoverability whenever events or
changes in circumstances indicate that their carrying
amounts may not be recoverable. For the purpose of
impairment testing, the recoverable amount (i.e. the
higher of the fair value less cost to sell and the value-
in-use) is determined on an individual asset basis
unless the asset does not generate cash flows that
are largely independent of those from other assets. In
such cases, the recoverable amount is determined for
the CGU to which the asset belongs.

If such assets are considered to be impaired, the
impairment to be recognised in the statement of profit

and loss is measured by the amount by which the
carrying value of the assets exceeds the estimated
recoverable amount of the asset. An impairment
loss is reversed in the statement of profit and loss if
there has been a change in the estimates used to
determine the recoverable amount.

The carrying amount of the asset is increased to
its revised recoverable amount, provided that this
amount does not exceed the carrying amount that
would have been determined (net of any accumulated
amortisation or depreciation) had no impairment loss
been recognised for the asset in prior years.

2.9 Leases

The Company as a lessee:

The Company's lease asset classes primarily consist
of leases for buildings. The Company assesses
whether a contract contains a lease, at inception of
a contract. A contract is, or contains, a lease if the
contract conveys the right to control the use of an
identified asset for a period of time in exchange for
consideration. To assess whether a contract conveys
the right to control the use of an identified asset, the
Company assesses whether: (i) the contract involves
the use of an identified asset (ii) the Company has
substantially all of the economic benefits from use
of the asset through the period of the lease and (iii)
the Company has the right to direct the use of the
asset. At the date of commencement of the lease, the
Company recognises a right-of-use (ROU) asset and a
corresponding lease liability for all lease arrangements
in which it is a lessee, except for leases with a term of
12 months or less (short-term leases) and low value
leases. For these short term and low-value leases,
the Company recognises the lease payments as an
operating expense over the term of the lease.

Certain lease arrangements includes the option to
extend or terminate the lease before the end of the
lease term. ROU assets and lease liabilities includes
these options when it is reasonably certain that they will
be exercised. The ROU assets are initially recognised at
cost, which comprises the initial amount of the lease
liability adjusted for any lease payments made at or
prior to the commencement date of the lease plus
any initial direct costs less any lease incentives. They
are subsequently measured at cost less accumulated
depreciation and impairment losses.ROU assets
are depreciated from the commencement date on
straight-line basis over the shorter of the lease term
and useful life of the underlying asset. ROU assets

are evaluated for recoverability whenever events or
changes in circumstances indicate that their carrying
amounts may not be recoverable. For the purpose of
impairment testing, the recoverable amount (i.e. the
higher of the fair value less cost to sell and the value-
in-use) is determined on an individual asset basis
unless the asset does not generate cash flows that
are largely independent of those from other assets.
In such cases, the recoverable amount is determined
for the Cash Generating Unit (CGU) to which the
asset belongs. The lease liability is initially measured
at amortised cost at the present value of the future
lease payments. The lease payments are discounted
using the interest rate implicit in the lease or, if not
readily determinable, using the incremental borrowing
rates in the country of domicile of these leases. Lease
liabilities are re-measured with a corresponding
adjustment to the related ROU asset if the Company
changes its assessment of whether it will exercise
an extension or a termination option. Lease liability
and ROU assets have been separately presented in
the Balance Sheet and lease payments have been
classified as financing cash flows

Short-term leases and leases of low-value assets:

The Company applies the short-term lease recognition
exemption to its short-term leases of buildings (i.e.,
those leases that have a lease term of 12 months
or less from the commencement date and do not
contain a purchase option) For these short-term and
low value leases, the Company recognises the lease
payments as an operating expense on a straight-line
basis over the term of the lease.

2.10 Investments in subsidiaries and joint ventures

Investment in equity instruments issued by subsidiaries
and associates are measured at cost less impairment.
Dividend income from subsidiaries and associates is
recognised when its right to receive the dividend is
established. The acquired investment in subsidiaries
and associates are measured at acquisition date
fair value.Where an indication of impairment exists,
the carrying amount of the investment is assessed
and written down immediately to its recoverable
amount. On disposal of investments in subsidiaries
and associates the difference between net disposal
proceeds and the carrying amounts are recognised
in the Statement of Profit and Loss.Investment in
debentures of the subsidiaries and associate are
treated as equity instruments if they meet the definition
of equity as per Ind AS 32 and are measured at cost.
Investment in debentures not meeting the aforesaid

conditions are classified as debt instruments and are
accounted for under Ind AS 109.

2.11 Inventories

Inventories (raw materials, consumables and stores
and spares) are valued at lower of cost and net
realisable value. Cost of inventories comprises
purchase price and other costs incurred in bringing
the inventories to their present location and condition.
Cost is determined using the weighted average
method. Net realisable value is the estimated selling
price in the ordinary course of business, less the
estimated costs to sell.

2.12 Cash and cash equivalents

Cash and cash equivalents comprise cash
in hand and in banks, demand deposits with
banks which can be withdrawn at any time
without prior notice or penalty on the principal
and other short-term highly liquid investments
with original maturities of three months or less.
For the purpose of cash flow statement, cash and cash
equivalent includes cash on hand, in banks, demand
deposits with banks and other short-term highly liquid
investments with original maturities of three months
or less, net of outstanding bank overdrafts that are
repayable on demand and are considered part of the
cash management system.

2.13 Financial Instruments

Financial assets and financial liabilities are recognised
when the Company becomes a party to the
contractual provisions of the instrument.

A Financial Assets

Initial recognition and measurement

All financial assets are recognised 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. Transaction
costs of financial assets carried at fair value
through profit or loss are expensed in profit or loss.

Financial assets are classified, at initial
recognition, as financial assets measured at
fair value or as financial assets measured at
amortised cost.

Subsequent measurement

For purposes of subsequent measurement,
financial assets are classified in three categories:

1. Financial assets at amortised cost

2. Financial assets at fair value through other
comprehensive income (FVTOCI)

3. Financial assets at fair value through profit
or loss (FVTPL)

Financial asset at amortised cost

A financial asset is measured at the amortised
cost if both the following conditions are met:

1. The asset is held within a business model
whose objective is to hold assets for
collecting contractual cash flows, and

2. Contractual terms of the asset give rise on
specified dates to cash flows that are solely
payments of principal and interest (SPPI) on
the principal amount outstanding.

After initial measurement, such financial assets
are subsequently measured at amortised cost
using the effective interest rate (EIR) method.
Amortised 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 amortisation is included in finance
income in the profit or loss. The losses arising
from impairment are recognised in the profit or
loss. This category generally applies to trade and
other receivables.

Financial asset at FVOCI

A financial asset is classified as at the FVTOCI if
both of the following criteria are met:

1. The objective of the business model is
achieved both by collecting contractual
cash flows and selling the financial assets,
and

2. The asset's contractual cash flows represent
SPPI

Financial asset at FVTPL

FVTPL is a residual category for debt instruments.
Any debt instrument, which does not meet the
criteria for categorisation as at amortised cost or
as FVTOCI, is classified as at FVTPL.

In addition, a company may elect to designate a debt
instrument, which otherwise meets amortised cost or
FVTOCI criteria, as at FVTPL. However, such election
is allowed only if doing so reduces or eliminates a
measurement or recognition inconsistency (referred

to as 'accounting mismatch'). The Company has not
designated any debt instrument as at FVTPL. Financial
assets included within the FVTPL category are
measured at fair value with all changes recognised in
the Statement of profit and loss.

Equity investments Other than Investments in
subsidiaries, associates and joint ventures

All equity investments in scope of Ind AS 109 are
measured at fair value and are classified as FVTPL.

De-recognition

The Company derecognises financial assets when:

1. The rights to receive cash flows from the asset
have 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 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.

When the Company has transferred its rights to
receive cash flows from an asset or has entered
into a pass-through arrangement, it evaluates
if and to what extent it has retained the risks
and rewards of ownership. When it has neither
transferred nor retained substantially all of the
risks and rewards of the asset, nor transferred
control of the asset, the Company continues
to recognise the transferred asset to the extent
of the Company's continuing involvement. In
that case, the Company also recognises an
associated liability. The transferred asset and
the associated liability are measured on a basis
that reflects the rights and obligations that the
Company has retained.

Continuing involvement that takes the form
of a guarantee over the transferred asset is
measured at the lower of the original carrying
amount of the asset and the maximum amount
of consideration that the Company could be
required to repay.

Impairment of Financial Assets

The Company assesses impairment based on
expected credit loss (ECL) model to the following:

1. Financial assets measured at amortised
cost;

2. Financial assets measured at fair value

through other comprehensive income

(FVTOCI);

Expected credit losses are measured through a
loss allowance at an amount equal to:

1. The 12-months expected credit losses

(expected credit losses that result from those
default events on the financial instrument
that are possible within 12 months after the
reporting date); or

2. Full time expected credit losses (expected
credit losses that result from all possible
default events over the life of the financial
instrument).

The Company follows 'simplified approach' for
recognition of impairment loss allowance on
trade receivables or contract revenue receivables.

The Company follows the simplified approach
permitted by Ind AS 109 - Financial Instruments-
for recognition of impairment loss allowance.
The application of simplified approach does not
require the Company to track changes in credit
risk of trade receivable. The Company calculates
the expected credit losses on trade receivables
on the basis of its historical credit loss experience.
The Company follows 'simplified approach' for
recognition of impairment loss allowance on
trade receivables or contract revenue receivables.

ECL impairment loss allowance (or reversal)
recognised during the period is recognised as
income/ expense in the statement of profit and
loss. This amount is reflected under the head
'other expenses' in the statement of profit and
loss. The balance sheet presentation for various
financial instruments is described below:

Financial assets measured as at amortised
cost, contractual revenue receivables and lease
receivables: ECL is presented as an allowance,
i.e., as an integral part of the measurement of
those assets in the balance sheet. The allowance

reduces the net carrying amount. Until the asset
meets write-off criteria, the Company does not
reduce impairment allowance from the gross
carrying amount.

Loan commitments and financial guarantee
contracts: ECL is presented as a provision in the
balance sheet, i.e. as a liability.

For assessing increase in credit risk and impairment
loss, the Company combines financial instruments on
the basis of shared credit risk characteristics with the
objective of facilitating an analysis that is designed
to enable significant increases in credit risk to be
identified on a timely basis.

The Company does not have any purchased or
originated credit-impaired (POCI) financial assets,
i.e., financial assets which are credit impaired on
purchase/ origination.

The Company follows 'simplified approach' for
recognition of impairment loss allowance on trade
receivables or contract revenue receivables.

B Financial liabilities and equity instruments
Classification as debt or equity

Financial liabilities and equity instruments issued
by the Company are classified according to the
substance of the contractual arrangements entered
into and the definitions of a financial liability and an
equity instrument.

Equity instruments

An equity instrument is any contract that evidences
a residual interest in the assets of the Company after
deducting all of its liabilities. Equity instruments are
recorded at the proceeds received, net of direct issue
costs.

Financial liabilities

Initial recognition and measurement

All financial liabilities are recognised initially at fair
value and, in the case of loans and borrowings and
payables, net of directly attributable transaction
costs.

The Company's financial liabilities include trade and
other payables, loans and borrowings including bank
overdrafts.

Subsequent measurement

The measurement of financial liabilities depends on
their classification, as described below:

1. Financial liabilities at fair value through profit or loss

2. Loans and borrowings measured on amortised
cost basis

3. Financial guarantee contracts

Financial liabilities at fair value through profit or loss

Financial liabilities at fair value through profit or
loss include financial liabilities held for trading and
financial liabilities designated upon initial recognition
as at fair value through profit or loss. Financial liabilities
are classified as held for trading if they are incurred for
the purpose of repurchasing in the near term.

Gains or losses on liabilities held for trading are
recognised in the profit or loss.

Financial liabilities designated upon initial recognition
at fair value through profit or l oss are designated as such
at the initial date of recognition, and only if the criteria
in Ind AS 109 are satisfied. For liabilities designated as
FVTPL, fair value gains/ losses attributable to changes
in own credit risk are recognised in OCI. These gains/
loss are not subsequently transferred to the Statement
of profit and loss. However, the Company may transfer
the cumulative gain or loss within equity. All other
changes in fair value of such liability are recognised
in the statement of profit and loss. The Company has
not designated any financial liability as at FVTPL.

Loans and borrowings

After initial recognition, interest-bearing loans and
borrowings are subsequently measured at amortised
cost using the EIR method. Gains and losses are
recognised in the Statement of profit and loss when
the liabilities are derecognised as well as through the
EIR amortisation process. Amortised 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 amortisation is included as finance
costs in the Statement of profit and loss.

Financial guarantee contracts

Financial guarantee contracts issued by the Company
are those contracts that require a payment to be made
to reimburse the holder for a loss it incurs because the
specified debtor fails to make a payment when due
in accordance with the terms of a debt instrument.
Financial guarantee contracts are recognised initially
as a liability at fair value, adjusted for transaction
costs that are directly attributable to the issuance of
the guarantee. Subsequently, the liability is measured
at the higher of the amount of loss allowance

determined as per impairment requirements of Ind
AS 109 and the amount recognised less cumulative
amortisation.

Derecognition

A financial liability is derecognised when the obligation
under the liability is discharged or cancelled or
expires. When an existing financial liability is replaced
by another from the same lender on substantially
different terms, or the terms of an existing liability
are substantially modified, such an exchange or
modification is treated as the derecognition of the
original liability and the recognition of a new liability.
The difference in the respective carrying amounts is
recognised in the statement of profit and loss.

C Off-setting of financial instruments

Financial assets and financial liabilities are offset and
the net amount is reported in the balance sheet if
there is a currently enforceable legal right to offset
the recognised amounts and there is an intention to
settle on a net basis, to realise the assets and settle
the liabilities simultaneously.

D Derivative financial instruments

Initial recognition and subsequent measurement

The Company uses derivative financial instruments,
such as forward currency contracts, to hedge its
foreign currency risks. Such derivative financial
instruments are initially recognised at fair value on
the date on which a derivative contract is entered
into and are subsequently re-measured at fair value.
Derivatives are carried as financial assets when the
fair value is positive and as financial liabilities when
the fair value is negative.

Premium/Discount, in respect of forward foreign
exchange contract, is recognised over the life of the
contracts. Exchange differences on such contracts
are recognised in the Statement of Profit and Loss in
the period in which the exchange rate changes. Profit/
Loss on cancellation / renewal of forward exchange
contract is recognised as income/expense.