A) Material Accounting Policies:
a) Basis of measurement:
The Financial Statements have been prepared on
historical cost basis, except the following:
• Certain financial assets and liabilities that is
measured at fair value.
• Defined benefit plans - plan assets
measured at fair value less present value of
defined obligations.
• Share Based Payments Measured at Fair Value.
b) Use of Estimates:
The preparation of the financial statements
requires management to make estimates,
judgements and assumptions that affect the
reported balances of assets and liabilities,
disclosure of contingent liabilities as on the date
of financial statements and reported amounts
of income and expenses during the period.
Uncertainty about these assumptions and
estimates could result in outcomes that require
a material adjustment to the carrying amount of
assets or liabilities affected in future periods.
The key assumptions concerning the future and
other key sources of estimation uncertainty
at the reporting date that have a significant
risk of causing a material adjustment to the
carrying amounts of assets and liabilities within
the next financial year are described in Notes
No. 4. The Company based its assumptions and
estimates on parameters available when the
financial statements were prepared. Existing
circumstances and assumptions about future
developments, however, may change due to
market changes or circumstances arising that are
beyond the control of the Company. Such changes
are reflected in the assumptions when they occur.
c) Property, Plant and Equipment:
Freehold land is carried at historical cost. Capital
work in progress, and all other items of property,
plant and equipment are stated at historical cost
net of accumulated depreciation and accumulated
impairment losses, if any.
Historical cost includes expenditure that is
directly attributable to the acquisition of the
items. Such cost includes the costs for long¬
term construction projects if the recognition
criteria are met.
Subsequent costs are included in the asset’s
carrying amount or recognised as a separate
asset, as appropriate, only 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. The carrying
amount of any component accounted for as a
separate asset is derecognised when replaced.
All other repairs and maintenance are charged to
statement of profit and loss during the reporting
period in which they are incurred.
Depreciation methods, estimated useful lives
and residual value
Depreciation is calculated using the Written down
Value method to allocate their cost, net of their
residual values, over their estimated useful life
as specified by Schedule II to the Companies Act;
2013. The residual values are not more than 5% of
the original cost of the asset. The asset's residual
values and useful life and method of depreciation
are reviewed, and adjusted if appropriate, at the
end of each reporting period.
d) Investment properties:
Recognition and measurement:
Freehold land is carried at historical cost.
Investment properties are held to earn rentals
or for capital appreciation, or both, but not for
sale in the ordinary course of business, use in
the production or supply of goods or services
or for administrative purposes. Investment
properties are measured initially at their cost
of acquisition. The cost comprises purchase
price, borrowing cost for long term construction
contract if capitalisation criteria are met and
directly attributable cost of bringing the asset
to its working condition for the intended use.
Subsequent to initial recognition, investment
property is measured at cost less accumulated
depreciation and accumulated impairment
losses, if any.
Investment Property under Construction
Investment Property under Construction
comprises of the cost of investment property that
are not yet ready for their intended use as at the
balance sheet date.
e) Impairment of Financial assets:
The company assesses impairment based
on expected credit losses (ECL) model
for the following:
• Financial assets carried at amortised cost;
• Financial assets measured at FVTOCI for
debt instrument
At each reporting date, the Company assesses
whether financial assets carried at amortized
cost and debt securities at FVTOCI are credit
impaired. A financial asset is ‘credit impaired’
when one or more events that have a detrimental
impact on the estimated future cash flows of the
financial asset have occurred.
Trade Receivables
The application of simplified approach does
not require the Company to track changes in
credit risk. Rather, it recognises impairment
loss allowance based on lifetime ECLs at each
reporting date, right from its initial recognition.
The Company uses a provision matrix to
determine impairment loss allowance on its
trade receivables. The provision matrix is based
on its historically observed default rates over
the expected life of the trade receivables and is
adjusted for forward-looking estimates. At every
reporting date, the historical observed default
rates are updated and changes in the forward¬
looking estimates are analysed.
For recognition of impairment loss on other
financial assets and risk exposure, the Company
determines that whether there has been a
significant increase in the credit risk since initial
recognition. If credit risk has not increased
significantly, 12-month ECL is used to provide
for impairment loss. However, if credit risk has
increased significantly, lifetime ECL is used. If, in a
subsequent period, credit quality of the instrument
improves such that there is no longer a significant
increase in credit risk since initial recognition,
then the entity reverts to recognise impairment
loss allowance based on 12-month ECL.
Lifetime ECL are the expected credit losses
resulting from all possible default events over
the expected life of a financial instrument. The
12-month ECL is a portion of the lifetime ECL which
results from default events that are possible
within 12 months after the reporting date.
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.
Financial Liabilities and equity instruments:
Debt and equity instruments issued by the
Company are classified as either financial
liabilities or as equity in accordance with the
substance of the contractual arrangements
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
an entity after deducting all of its liabilities.
Equity instruments issued by the Company are
recognised at the proceeds received, net of
direct issue costs.
i) Initial recognition and measurement:
All financial liabilities are recognised initially
at fair value and, in the case of borrowings,
net of directly attributable transaction costs.
The Company’s financial liabilities include
trade and other payables, security deposits
for lease rentals and borrowings including
bank overdrafts.
(ii) Subsequent measurement:
The measurement of financial liabilities
depends on their classification, as
described below:
Financial liabilities at fair value through
profit or loss
Financial liabilities at fair value through
profit or loss include financial liabilities held
for trading or has designated upon initial
recognition 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 arising on remeasurement of
on liabilities held for trading are recognised
in the statement of profit and loss.
Financial liabilities designated upon initial
recognition at fair value through profit or
loss are designated as such at the initial date
of recognition, and only if the criteria in Ind
AS 109, ‘Financial Instruments’ are satisfied.
Loans and Borrowings:
After initial recognition, interest-bearing loans
and borrowings are subsequently measured at
amortised cost using the effective interest rate
(EIR) method. Gains and losses are recognised in
profit or 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.
Trade and other payables:
These amounts represent liabilities for goods and
services provided to the Company prior to the
end of financial year which are unpaid. Trade and
other payables are presented as current liabilities
unless payment is not due within 12 months after
the reporting period.
f) Revenue Recognition:
The Company’s revenue from contracts with
customers is mainly from License Fees and Other
Services rendered to the customers in Malls.
Ind AS 116 ‘Leases’ sets out the principles for
the recognition, measurement, presentation and
disclosures for both parties to a contract, i.e., the
lessee and the lessor.
Revenue from license fees and other services
Revenue from license fees are recognised on a
straight-line basis over the lease terms. Income
from utilities and other services provided to
licensees’ specific usage is recognised on
accrual basis in accordance with the terms of
the agreements.
Revenue from other services is recognized
on satisfaction of performance obligation
upon transfer of control of promised services
to customers in an amount that reflects the
consideration the Company expects to receive
in exchange for those services, excluding
amounts collected on behalf of third parties (for
example taxes and duties collected on behalf of
the government). Consideration is generally due
upon satisfaction of performance obligations
and a receivable is recognized when it becomes
unconditional. Generally, the credit period varies
between 0-30 days from the delivery of services.
A contract asset (trade receivables) is the right to
consideration in exchange for goods or services
transferred to the customer. If the Company
performs part of its obligation by transferring
goods or services to a customer before the
customer pays consideration or before payment is
due, a contract asset is recognised for the earned
consideration when that right is conditional on
the Company’s future performance.
g) Employees benefits:
Post-employment benefits
a. Defined Contribution Plan
The defined contribution plan is post¬
employment benefit plan under which the
Company contributes fixed contribution to
a government administered fund and will
have no legal or constructive obligation to
pay further contribution. The Company’s
defined contribution plan comprises of
Provident Fund and Labour Welfare Fund.
The Company’s contribution to defined
contribution plans is recognized as an
expense in the period in which the employee
renders the related services.
b. Defined benefit plan
Short-term employee benefit obligations are
measured on an undiscounted basis and are
expensed as the related service is provided.
A liability is recognised for the amount
expected to be paid, if the Company has a
present legal or constructive obligation to
pay this amount as a result of past service
provided by the employee, and the amount of
obligation can be estimated reliably.
The Company has a defined benefit plan
comprising of gratuity. Company’s obligation
towards gratuity liability is funded and is
managed by Life Insurance Corporation of
India (LIC). The present value of the defined
benefit obligations is determined based on
actuarial valuation using the projected unit
credit method. The rate used to discount
defined benefit obligation is determined by
reference to market yields at the Balance
Sheet date on Indian Government Bonds for
the estimated term of obligations.
Re-measurements comprising of (a) actuarial
gains and losses, (b) the effect of the asset
ceiling (excluding amounts included in net
interest on the net defined benefit liability)
and (c) the return on plan assets (excluding
amounts included in net interest on the net
defined benefit liability) are recognized
immediately in the balance sheet with a
corresponding debit or credit to retained
earnings through other comprehensive
income in the period in which they occur. Re¬
measurements are not reclassified to the
profit or loss in subsequent periods.
The expected return on plan assets is the
Company’s expectation of average long-term
rate of return on the investment of the fund
over the entire life of the related obligation.
Plan assets are measured at fair value as at
the Balance Sheet date.
The interest cost on defined benefit
obligation and expected return on plan
assets is recognised under “Employee
Benefits Expense”.
Gains or losses on the curtailment or
settlement of defined benefit plan are
recognised when the curtailment or
settlement occurs.
Service cost (including current service cost,
past service cost, as well as gains and losses
on curtailments and settlements) is included
in profit or loss in the line item Employee
benefits expense.
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