Sole I: NATURE OF BUSINESS OPERATIONS:

Ouality Foils (India) Limited (hereinafter referred to as ‘the company') is a manufacturer ofCold Rolled
Stainless Steel Strips/coils and Stain ess Steel Flexible Hose Pipes.

The company inerrporated under the provisions of the Companies Act. 956 and domiciled in Indu. I he
registered office of the company is at 3. Industrial Development Colony. Hisar. Hary ana 125005. The
company is a public limited company and is listed on SME Platform of National Stock I xchange ol India
Ltd. (NSK EMERGE).

Note 2: ACCOUTING POLICIES:

2.1 STATEMENT OF COMPLIANCE

Ilic Standalone Financial Statements of the Company have been prepared in accordance with the
Accounting Principles gercrally accepted in India. The Financial Statements have been prepared to
comply in all material respects with the Accounting Standards, as pre>cribcd under section 133 of the
Companies Act. 2013 and the rules defined there under, as amended from time to time anc in accordance
with the requirements of Regulation 33 of the SERI fl.isting Obligations and disclosure Requirements)
Regulations 2015. as amended. The above financial results were reviewed by the Audit Committee and
approved by the Eoard of Directors at their respective meetings held on 15/05/2025. IND AS is currently
NOT applicable on the corrpany.

2.2 BASIS OF PREPARATION OF FINANCIAL STATEMENTS

2.2.1 i) flic standalone financial statements of the company have been prepared in accordance with the
Accounting Standards as prescribed under Section 133 of the Companies Act, 2013 und the rules framed
thereunder as applicable and guidelines issued by the Securities and Exchange Board of India ("SEBI").

ii) I he h nancial Statements are prepared on accrual basis under the historical cost convention.

2.2.2 FUNCTIONAL AND PRESENTATION CURRENCY

The functional currency ol the Company is Indian rupee (INRi. The standalone financial statements are
presented in Indian rupees (INR) and all values are rounded to nearest Lakhs up to two decimals, rnless
otherwise stated.

2.2.3 USE OF ESTIMATES

The preparation of financial statements in conformity with the generally accepted Accounting Standards
and prirciplcs requires Me management lo make estimates, judgements aid assumptions. These
estimates judgments and assumptions affect the application of accounting policies and reported rmumitts
of assets and liabilities, the disclosures of contingcn! assets end liabilities at the date oCthc timqoiai

uf'lk lr

statements and reported amounts of revenue and expeases during the year. Accounting Estimates could
change from period to period. Actua results could differ from those estimates Appropriate changes and
estimates are mace as Management become aware of chaages in circumstances surrounding the
estimates. Changes in estimates arc -cflcctcd in the financial statements in the period in which changes
are made and. if material, their effects arc disclosed in the notes to (he lituncial statements.

2.3 PROPERTY, PLANT AND EQl IPMENT

it Tangible assets:

Property. Plant ano Equipment arc stated at cost net of recoverable taxes, trade discounts and rebates, less
accumulated depreciation and impairment loss, if any. The cost of Assets comprises its purchase price,
borrowing cost unJ any cod directly attributable to bringing the asset to its working condition for its
intended use. net charges on foreign exchange contracts and adjustments arising; from exchange rate
\ariations attributable to the assets. Subsequent expenditures related to an item of Property. Plant and
Equipment are added to its book value only if they increase the future benefits from the existing assets
beyond its previously assessed standard of performance. Projects under which assets are not ready for
their intended use are reflected underCapital Work-in- Progress

ii) Depreciation:

Depreciation on Property. Plant and Equpment is provided on Straight Line Method (SLM).
Depreciation is provided based on useful life of the assets as prescribed in Schedule II of the Companies
Act. 2013 except ii respect of those assets w here useful life is d ITerent than those prescribed in Schedule
II are used. The residual value is not more than 5% of the original cost of the Asset. The Asset residual
value, useful lives and me.hod of depreciation are reviewed it each financial year end and adjusted
prospectively, if appropriate.

In rcspcc' of addition or extensions forming an integral part of existing assets and insurance spares,
including incremental cost arising or account of translation of foreign currency liabilities for acquisition
of Fixed Assets, depreciation is provided as aforesaid over the residual life of the respective assets.

iii) Intangible Assets:

The Company does not have any Intangible Assets

iv) Impairment of Assets:

An asset :s treated as impaired, if any. when the carrying cost of asset exceeds its recoverable value. An
impairment loss, if any. is charged to the Statement of Profit and Loss in the year in which an asset is
identified as impai'ed The impairment loss recognized in prior accounting period is reversed if there has
been a change in tie estimate of recoverable amount.

2.4 INVESTMENTS

All investments are classified as Long Terra Investments. Or initial recognition, all Investments are
measured at C ost. The Cost comprises the Purchase Price and directly attributable acquisition ctarges
hicIi as Ifokerage, Fees and Duties.

Long Icnn Investments arc carried at Cost. Hoxvevtr, provision for diminution in value is made to
recognize a decline other than temporary in the value of the Long Term Investments.

On disposal of an nvestment. the difference between its Carry ing Amount and Net Disposal Proceeds is
diargcd or credited to the Statement of Profit and Loss. /'₃\o A a

/VI "Sfr \

* rh \v

*.5 \ALUATION OF INVENTORIES

hems of inventories arc measured at lower of cost or net realizable value after providing for
obsolescence, if ary, cxccp: in ease of by-products, which are valued at the net realizable value. Cost of
inventories comprises of all costs of purchase, cost of conversion and oilier costs including manufacturing
overheads incurred in bringing then to their respective present location and condition Cost of raw
materials, process chemicals, store and spares, packing materials, trading and other products arc
determined on the basis of valuation of the finished goods as per the provisions so applicable.

i) Raw Material. Components, stores and spares: Raw Material. Components, stores and spares arc
valued at cost.

ii) Work-in-Progress and Finished Goods: Work-in-Progress and Finished goods arc valued at lower
of cost and net realizable value. Cost includes direct materials aid labour and a proportion of
manufacturing overhead based on normal operating capacity. Net Realizable value is the estimated
selling price in the ordinary course of business, less estimated cost of completion and estimated costs
necessary to make the sale

2.6 REVENUE RECOGNITION

Revenue is recognized to the extent that it is prohihle that the economic benefits will flow to the
Company and the revenue can be readily measured, regardless of when the payment is being made.
Revenue is measured at fair value of the consideration received or receivable, volume rebites if any, and
la.\c» or duties collected cu behalf of the government. which arc levied oil sales sucli as Goods and
Sen ices Tax. Revenue is recognized either in time or point of time, when (or asi the Company satisfies
performance obligations by transferring the goods or services to its customers. The company applies the
revenue recognition criteria to each separately identifiable component of the sales transaction as
mentioned in Statement of Profit & Loss.

i) Sale of Goods: Revenue from sale of goods is recognized at the point of dispatch of the flushed
goods to the customers against invoice(s). The company collects Goods & Service Tax on behalf of the
government and therefore these art not economic benefits flowing to the companies, hence, they are
excluded from the revenues.

ii) F.xport Benefits: Export Benefits consisting import duty benefits under Duty Draw Back arc
accounted for on accrual basis The same is recognized in the books of accounts n the year in which the
right to receive the duty draw hack credit as per the terms of ttie scheme is established in respect of the
export made.

iii) Div dends: Dividend Income is recognized when the right to receive payment is established.

iv) Interest Income: Interest Income is recognized cn a time proportion basis taking into account the
amount outstanding and the interest rate applicable.

v) Insurance Claims: Insurance and other claims, if any, arc recognized when there exist no
significant uncertainly w ith regard to the amount to be realized and the Ultimate collection thereof.

- - N°r\

17 FOREIGN EXCHANGE TRANSACTION

Transactions denominated in foreign currencies arc translated into function.il currcacy using the
exchange rate prevailing on the date of the transaction or that approximates the actual rati at the date of
the transaction.

Monetary items denominated in foreign currencies at the year-end are restated at year-end rates. In the
case of items which arc covered by forward exchange contracts, the difference between the ycarenJ rate
and rate on the dale of the contract, if any. is recognized as exchange difference and the premium paid on
forward contracts is recognised over .he life of the contract.

Non-monetnry foreign currency items are carried at cost.

In respect of integral foreign operations, all transactions arc translated at rates ptevailingon the date of
transaction or that approximates the actual rate at the date of transaction.

Any income or expense on account of exchange difference either on settlement or on translation is
recognized in the Statement of Profit and Loss, except in case ot long term liabilities, w here they relate to
acquisition of fixed assets, in which case they arc adjusted to thccarryingcost of such assets.

2.8 BORROWING COSTS

Borrow ing cost attributable to the acquisition or construction of a qualifying asset arc capitalized as part
of the cost of such asset. A qualifying asset is one that necessarily takes substantial period of time to get
ready for intended use. All other Borrowing ;osts are recognized ax an expense in the period in which
tney are incurred. Borrow iig Cost consist of Interest and Other Cost that an entry incurs in connection
with the Borrow ing of fund*.

2.9 EMPLOYEE BENEFITS

i) POST EMPLOYMENT BENEFITS

Defined Contribution Plan: A defined contribution plan is a post-employment benefit plan under which
the Company pays specified contributions to a separate entity. The Company makes specified monthly
contributions towards Provident Fund, Superannuation Fund and Persion Scheme. The Company's
contribution is recognized as an expense in the Statement of Profit and I oss during the period in which
the employee renders the related service.

ii) SHORT TERM EMPLOYEE BENEFITS

All employee benefits payable wholly within twelve months of rcndcriig the services arc classified as
•diort-tcrn employee benefits, such as salaries wages, bonus etc The undiscountcd amount of shortterm
employ ee benefits expected to be paid in exchange for the services rendered by employees are recognized
as an expense during the period when the employees render the services. These benefits include
performance incentive and compensated absences.

2.10 TAXATION

Income Fix composed of Current Income tax. Deferred Taxes and Mat Credit.

i) Current Income Tax: Current Income lax for the current and prior periods arc measured at the
amount expected to be paid to the lax authorities, using the applicable tax rales. The tax rates and tax
laws used to compute the current tax amounts arc those that arc enacted or substantively enacted as at the
reporting dale and applicable for the period. While determining the lax provisions, the Company assesses
whether each uncertain tax position is to be considered separately or together with one or more uncertain
tax positions depending the nature and circumstances of each uncertain tax position. I he Company
offsets current tax assets and current tax liabilities, where it has a legally enforceable right to set off the
recognized amounts and wlterc it intends either to settle on a net basis, or to realize the asset and liability
simultaneously.

ii) Deferred Income Tax: Deferred income tax is recognized using the Balance Sheet approach.
Deferred income tax assets and liabilities are recognized for deductible and taxable temporary differences
arising between the tax base of assets and liabilities and their carrying amount in financial statements,
except when the deferred income lax arises from the initial recognition of goodwill or an asset or
liability in a transaction that is not a business combination and affects neither accounting nor taxable
profits or loss at the time of the transaction.

Deferred income tax assets are recognized to the extent it is probable that taxable profit will be available
against which the deductible temporary differences and the carry forward of unused tax credits and
unused tax losses can be utilized. The carrying amount of deferred income tax assets is reviewed at each
reporting date and reduced i<* the extent that it is no longer probable that sufficient taxable profit will be
available to allow all or part of the deferred income tax asset to be utilized. Deferred income tax assets
and liabilities are measured at the tax rates that arc expected to apply in the period when the asset is
realized or the liability is settled, based on tax rates (and tax laws) that have been enacted or substantively
enacted at the reporting date

iii) MA I Credit: MAT Credit is recognized as an asset only when and to the extent there is convincing
evidence that the company will pay normal Income Tax during the specified period In the year in which
ihe MA I Credit becomes eligible to be recognized as an asset in accordance with the recommendation
contained in Guidance Notes issued by the ICAI. the said asset is created by way of a credit to the
statement of profit & loss and shown as MAT Credit entitlement. The Company reviews the same at each
Balance Sheet date and writes down the carrying amount of MAT Credit entitlement to the extent there is
no longer convincing evidence to the effect that company will pay normal Income Tax during the
specified period.