Significant Accounting Policies
1. Compliance with Ind AS
The Company's financial statements have been prepared in accordance with the provisions of the Companies Act, 2013 and the
Indian Accounting Standards (Ind AS) notified under the Companies (Indian Accounting Standards) Rules, 2015 as amended
from time to time
These financial statements include the balance sheet, the statement of profit and loss, the statement of changes in equity and the
statement of cash flows and notes, comprising a summary of significant accounting policies and other explanatory
information-and comparative information in respect of the preceding period.
2. B asis of Accounting
The Company maintains its accounts on accrual basis following the historical cost convention except certain financial
instruments that are measured at fair values in accordance with Ind AS
Fair value measurements are categorized into Level 1, 2 or 3 based on the degree to which the inputs to the fair value
measurements are observable and the significance of the inputs to the fair value measurement in its entirety, which are
described as follows:
• Level I inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities that entity can access at
measurement date
• Level II inputs are inputs, other than quoted prices included in Level 1, that are observable for the asset or liability, either
directly or indirectly; and
• Level III inputs are unobservable inputs for the asset or liability
3. Presentation of financial statements
The financial statements (except Statement of Cash-flow) are prepared and presented in the format prescribed in Division II -
IND AS Schedule III ("Schedule III") to the Companies Act, 2013.
The Statement of Cash Flow has been prepared and presented as per the requirements of IndAS 7 "Statement of Cash flows"
Disclosure requirements with respect to items in the financial statements, as prescribed in Schedule III to the Act, are presented
by way of notes forming part of accounts along with the other notes required to be disclosed under the notified Accounting
Standards
Amounts in the financial statements are presented in Indian Rupees in Lakhs in line with the requirements of Schedule III. Per
share data are presented in Indian Rupees to two decimals places.
4. Key estimates and assumptions
The preparation of the financial statements in conformity with Ind AS requires the Management to make estimates and
assumptions that impact the reported amount of assets, liabilities, income, expenses and disclosure of contingent liabilities as at
the date of the financial statements. The estimates and assumptions used in the accompanying financial statements are based
upon management's evaluation of the relevant facts and circumstances as on the date of the financial statements. Actual results
may differ from the estimates and assumptions used in preparing the accompanying financial statements. Difference between
the actual and estimates are recognized in the period in which they actually materialize or are known. Any revision to
accounting estimates is recognized prospectively. Management believes that the estimates used in preparation of Financial
Statements are prudent and reasonable.
5. Foreign Currency
Functional and presentation currency
The financial statements of the Company are presented using Indian Rupee (INR) i.e. currency of the primary economic
environment in which the entity operates ('the functional currency7)
Transactions and balances
Foreign currency transactions are translated into the respective functional currency using the exchange rates at the dates of the
transactions. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation of
monetary assets and liabilities denominated in foreign currencies at year end exchange rates are recognised in profit or loss.
Premium/Discount in respect of forward contracts is accounted over the period of contract
6. Revenue recognition
Revenue is recognised to the extent that it is probable that the economic benefits will flow to the company and the revenue can be
reliably measured. Escalation and other claims, which are not ascertainable/acknowledged by customers, are not taken into
account. Revenue is measured at the fair value of the consideration received or receivable, net of returns and allowances, trade
discounts and volume rebates.
Criteria for recognition of revenue are as under:
a) Sale of Goods
Revenue from the sale of goods is recognised when the goods are delivered and titles have passed, at which time all the
following conditions are satisfied:
i. significant risks and rewards of ownership of the goods are transferred to the buyer;
ii. Company retains neither continuing managerial involvement to the degree usually associated with ownership nor
effective control over the goods sold;
iii. it is probable that economic benefits associated with transaction will flow to the Company; and
iv. amount of revenue can be measured reliably;
b) In cases where trade contracts provide for crystallization of price or for price adjustment on a subsequent date,
corresponding purchase and sales are recognized on the basis of expected settlement price and any differential
determined subsequently is accounted for at the time of final settlement.
c) Interest income is recognized on a time proportion basis taking into account amount outstanding and applicable interest
rate..
7. Property, Plant and Equipment (PPE)
PPE is recognized when it is probable that future economic benefits associated with the item will flow to the Company and the
cost of the item can measured reliably. Freehold land is carried at historical cost. All other items of PPE are stated at cost net of
tax/duty credits availed, if any, less accumulated depreciation and cumulative impairment. Cost includes expenditure that is
directly attributable to the acquisition and installation of such assets
PPE not ready for the intended use on the date of the Balance Sheet is disclosed as "capital work-in-progress"
Depreciation methods, estimated useful lives and residual value
Depreciation is calculated using the WDV method to allocate their cost, net of their residual values, over their estimated useful
lives specified in schedule II to the Companies Act, 2013.
8. Intangible assets
Intangible assets are recognized when it is probable that the future economic benefits that are attributable to the assets will flow
to the Company and the cost of the asset can be measured reliably. Intangible assets acquired by the Company are measured at
cost less accumulated amortisation and any accumulated impairment losses. Cost includes expenditure that is directly
attributable to the acquisition and installation of such assets.
Amortisation
Amortisation is calculated to write off the cost of intangible assets less their estimated residual values using the straight-line
method over their estimated useful lives.
The intangible assets are amortised over the estimated useful lives as given below:
Type of Asset Life
Trade Mark and Brand 5 years
9. Impairment of Non Financial Assets
Assets are tested for impairment whenever events or changes in circumstances indicate that the carrying amount may not be
recoverable. An impairment loss is recognised for the amount by which the asset's carrying amount exceeds its recoverable
amount. The recoverable amount is the higher of an asset's fair value less costs of disposal and value in use.
10. Inventories
Inventory is valued at cost or net realizable value whichever is lower. Cost includes all non refundable taxes and expenses
incurred to bring the inventory to the present location. Cost is determined using the Weighted Average method of valuation for
Raw Material, Work in Progress and Finished Goods. Traded Goods are valued at actual cost.
11. Borrowing costs
Borrowing costs that are directly attributable to the acquisition, construction or production of a qualifying asset are capitalised
during the period of time that is required to complete and prepare the asset for its intended use or sale. Qualifying assets are
assets that necessarily take a substantial period of time to get ready for their intended use or sale
Other borrowing costs are expensed in the period in which they are incurred.
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