Note 1.1 Significant Accounting Policies
A. Company’s Information
Samyak International Limited is a Listed Public Company registered in India, under Companies Act 1956, and was
incorporated in July 1994. The Company is mainly engaged in the business of trading of Petro products and other
Commodities and Mf. Of aluminum Caps and Printing Jobwork etc. The registered office of the Company is located at
Mumbai (Maharastra), India and a Corporate Office is situated in Indore (Madhya Pradesh).
B. Basis of Preparation
The financial statements of the Company have been prepared to comply in all material respects with the Indian Accounting
Standards (" Ind AS") notified under the Companies (Accounting Standards) Rules, 2015.
The financial statements have been prepared under the historical cost convention with the exception of certain financial
assets and liabilities which have been measured at fair value, on an accrual basis of accounting.
All the assets and liabilities have been classified as current and non-current as per normal operating cycle of the Company and
other criteria set out in as per the guidance set out in Schedule III to the Act. Based on nature of services, the Company
ascertained its operating cycle as 12 months for the purpose of current and non- current classification of asset and liabilities.
The Company's financial statements are reported in Indian Rupees in lacs, which is also the Company’s functional currency.
C. Accounting Estimates
The preparation of the financial statements, in conformity with the Ind AS, requires the management to make estimates and
assumptions that affect the application of accounting policies and the reported amounts of assets and liabilities and
disclosure of contingent liabilities as at the date of financial statements and the results of operation during the reported
period. Although these estimates are based upon management’s best knowledge of current events and actions, actual results
could differ from these estimates which are recognized in the period in which they are determined.
Estimates and assumptions
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. 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 financial statements in the
period in which changes are made and, if material, their effects are disclosed in the notes to the financial statements.
Estimation of uncertainties relating to the global health pandemic from COVID-19
In March 2020, the World Health Organization declared COVID-19 to be a pandemic. The Company has adopted measures
to curb the spread of infection in order to protect the health of its employees and ensure business continuity with minimal
disruption. In view of the pandemic relating to COVID-19, the Company has considered internal and external information
and has performed an analysis based on current estimates while assessing the recoverability of assets including trade
receivables, inventories and other current / non-current assets (net of provisions established) for any possible impact on the
standalone financial statements. The Company has also assessed the impact of this whole situation on its capital and
financial resources, profitability, liquidity position, internal financial controls etc., and is of the view that based on its
present assessment; this situation does not materially impact these Standalone financial statements of the Company. The
Company will continue to closely monitor any material changes to future economic conditions.
Deferred tax assets
In assessing the reliability of deferred income tax assets, management considers whether some portion or all of the deferred
income tax assets will not be realized. The ultimate realization 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 income tax liabilities, projected future taxable income, and tax planning strategies in making
this assessment. Based on the level of historical taxable income and projections for future taxable income over the periods in
which the deferred income tax assets are deductible, management believes that the Company will realize the benefits of those
deductible differences. The amount of the deferred income tax assets considered realizable, however, could be reduced in the
near term if estimates of future taxable income during the carry forward period are reduced.
D. Property, Plant and Equipment
Property, Plant and Equipment are stated at cost of acquisition including attributable interest and finance costs, if any, till the
date of acquisition/ installation of the assets less accumulated depreciation and accumulated impairment losses, if any.
Subsequent expenditure relating to Property, Plant and Equipment is capitalized 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. All other
repairs and maintenance costs are charged to the Statement of Profit and Loss as incurred. The cost and related accumulated
depreciation are eliminated from the financial statements, either on disposal or when retired from active use and the resultant
gain or loss are recognized in the Statement of Profit and Loss. This treatment is according to the IND AS 16 Property, Plant
and Equipment.
E. Depreciation/ Amortization
Depreciation/ Amortization is provided as stated below:-
i) Depreciation on all Fixed Assets is provided on ‘Straight Line Method’ at the rates and in the manner prescribed in the
Schedule II of the Companies Act, 2013 .Depreciations on additions & deletions made during the year is provided on pro¬
rata basis from & up to the date of acquisitions and deletions of assets respectively.
ii) Leasehold improvements written off over the non- cancellable period of lease.
iii) Intangible assets are amortized over a period of four years.
F. Financial Instruments
A financial instrument is any contract that gives rise to a financial asset for one entity and a financial liability or equity
instrument for another entity.
a) Financial Assets Initial
Recognition
In the case of financial assets, not recorded at fair value through profit or loss (FVPL), financial assets are recognized
initially at fair value plus transaction costs that are directly attributable to the acquisition of the financial asset. Purchases or
sales of financial assets that require delivery of assets within a time frame established by regulation or convention in the
market place (regular way trades) are recognized on the trade date, i.e., the date that the Company commits to purchase or
sell the asset.
Subsequent Measurement
Forpurposes ofsubsequent measurement, financial assets are classified in following categories:
Financial Assets at Amortized Cost
Financial assets are subsequently measured at amortized cost if these financial assets are held within a business model
with an objective to hold these assets in order to collect contractual cash flows and the contractual terms of the financial
asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount
outstanding. Interest income from these financial assets is included in finance income using the effective interest rate
("EIR") method. Impairment gains or losses arising on these assets are recognized in the Statement of Profit and Loss.
Financial Assets Measured at Fair Value
Financial assets are measured at fair value through OCI if these financial assets are held within a business model with an
objective to hold these assets in order to collect contractual cash flows or to sell these financial assets and the contractual
terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on
the principal amount outstanding. Movements in the carrying amount are taken through OCI, except for the recognition of
impairment gains or losses, interest revenue and foreign exchange gains and losses which are recognized in the Statement of
Profit and Loss.
Financial asset which are not measured at amortized cost or at fair value through OCI are measured at Fair Value through
P&L.
Impairment of Financial Assets
In accordance with Ind AS 109, the Company applies the expected credit loss ("ECL") model for measurement and
recognition of impairment loss on financial assets and credit risk exposures.
The Company follows ‘simplified approach’ for recognition of impairment loss allowance on trade receivables.
Simplified approach does not require the Company to track changes in credit risk. Rather, it recognises impairment loss
allowance based on lifetime ECL at each reporting date, right from its initial recognition.
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 recognising impairment loss allowance based on 12-month
ECL.
ECL is the difference between all contractual cash flows that are due to the group in accordance with the contract and all
the cash flows that the entity expects to receive (i.e., all cash shortfalls), discounted at the original EIR. 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.
ECL impairment loss allowance (or reversal) recognized during the period is recognized as income/ expense in the
Statement of Profit and Loss.
De-recognition of Financial Assets
The Company de-recognizes a financial asset only when the contractual rights to the cash flows from the asset expire, or it
transfers the financial asset and substantially all risks and rewards of ownership of the asset to another entity.
If the Company neither transfers nor retains substantially all the risks and rewards of ownership and continues to control
the transferred asset, the Company recognizes its retained interest in the assets and an associated liability for amounts it may
have to pay.
If the Company retains substantially all the risks and rewards of ownership of a transferred financial asset, the Company
continues to recognize the financial asset and also recognizes a collateralized borrowing for the proceedsreceived.
b) Equity Instruments and Financial Liabilities
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 which are issued for cash are recorded at the proceeds received, net of direct issue costs.
Equity instruments which are issued for consideration other than cash are recorded at fair value of the equity instrument.
Financial Liabilities
1) Initial Recognition
Financial liabilities are classified, at initial recognition, as financial liabilities at FVPL, loans and borrowings and
payables as appropriate. All financial liabilities are recognized initially at fair value and, in the case of loans and
borrowings and payables, net of directly attributable transaction costs.
2) Subsequent Measurement
The measurement of financial liabilities depends on their classification, as described below financial Liabilities at
FVTPL
Financial liabilities at FVTPL include financial liabilities held for trading and financial liabilities
designated upon initial recognition as at FVTPL. 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 recognized in the Statement of Profit and Loss.
Financial liabilities at amortized cost
After initial recognition, interest-bearing loans and borrowings are subsequently measured at amortized cost using the
EIR method. Any difference between the proceeds (net of transaction costs) and the settlement or redemption of
borrowings is recognized over the term of the borrowings in the Statement of Profit and Loss.
Amortized 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 amortization is included as finance costs in the Statement of Profit and Loss.
3) De-recognition of Financial Liabilities
Financial liabilities are de-recognized when the obligation specified in the contract is discharged, cancelled or expired.
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 de-recognition of
the original liability and recognition of a new liability. The difference in the respective carrying amounts is recognized in the
Statement ofProfit and Loss.
c) Offsetting Financial Instruments
F inancial 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 recognized amounts and there is an intention to settle on a net basis to realise the
assets and settle the liabilities simultaneously.
G. Cash and Cash Equivalents
Cash and cash equivalents in the Balance Sheet comprises of cash at banks and on hand and short-term deposits with an
original maturity of three month or less, which are subject to an insignificant risk of changes in value. Borrowing Costs
Borrowing costs consist of interest and other costs that the Company incurs in connection with the borrowing of funds. Also,
the EIR amortisation is included in finance costs.
H. Borrowing costs
Borrowing costs consist of interest and other costs that the Company incurs in connection with the borrowing of funds. Also, the
EIR amortization is included in finance costs.
Borrowing costs relating to acquisition, construction or production of a qualifying asset which takes substantial period of
time to get ready for its intended use are added to the cost of such asset to the extent they relate to the period till such assets
are ready to be put to use. All other borrowing costs are expensed in the Statement of Profit and Loss in the period in which they
occur.
I. Revenue Recognition
a Revenue is recognized to the extent it is probable that the economic benefits will flow to the Company and that the revenue
can be reliably measured, regardless of when the payment is being made. Revenue is measured at the fair value of the
consideration received or receivable, taking into account contractually defined terms of payment and excluding taxes or
duties collected on behalf of the government. The Company assesses its revenue arrangements against specific criteria,
i.e., whether it has exposure to the significant risks and rewards associated with the sale of goods or the rendering of
services, in order to determine if it is acting as a principal or as an agent. Revenue is recognized, net of trade discounts, sales
tax, service tax, VAT or other taxes, as applicable
b Revenue from domestic sales of goods is recognized when the significant risks and the rewards of ownership of the
goods are passed on to the buyer (i.e. on dispatch of goods). Revenue from the sale of goods is measured at the fair value
of consideration received or receivable, net of returns and allowances and discounts. For all financial assets measured either
at amortized cost or at fair value through other comprehensive income, interest income is recorded using the effective
interest rate (EIR). Interest income is recognized on a time proportion basis taking into account the amount outstanding.
Interest income is included under the head " other income" in the Statement of Profit and Loss.
c Dividend income is recognized when right to receive the payment is established.
d Claims for insurance are accounted on receipts/ on acceptance of claim by insurer.
J. Taxes on Income
Income tax comprises of current and deferred income tax. Income tax is recognized as an expense or income in the Statement of
Profit and Loss, except to the extent it relates to items directly recognized in equity or in OCI.
a. Current IncomeTax
Current income tax is recognized based on the estimated tax liability computed after taking credit for allowances and
exemptions in accordance with the Income T ax Act, 1961 and is made annually based on the tax liability after taking credit
for tax allowances and exemptions. Current income tax assets and liabilities are measured at the amount expected to be
recovered from or paid to the taxation authorities. The tax rates and tax laws used to compute the amount are those that
are enacted or substantively enacted, at the reporting date.
Current Tax items are recognized in correlation to the underlying transaction either in Statement of Profit And Loss, other
comprehensive income or directly in equity
b. Deferred Income Tax
Deferred tax is determined by applying the Balance Sheet approach. Deferred tax assets and liabilities are recognized for all
deductible temporary differences between the financial statements’ carrying amount of existing assets and liabilities and
their respective tax base. Deferred tax assets and liabilities are measured using the enacted tax rates or tax rates that are
substantively enacted at the Balance Sheet date. The effect on deferred tax assets and liabilities of a change in tax rates is
recognized in the period that includes the enactment date. Deferred tax assets are only recognized to the extent that it is
probable that future taxable profits will be available against which the temporary differences can be utilised. Such assets are
reviewed at each Balance Sheet date to reassess realisation.
Deferred tax assets and liabilities are offset when there is a legally enforceable right to offset. Current tax assets and tax
liabilities are offset where the entity has a legally enforceable right to offset and intends either to settle on a net basis, or
to realize the asset and settle the liability simultaneously. Minimum Alternative Tax ("MAT") credit is recognized as an
asset only when and to the extent it is probable that the Company will pay normal income tax during the specified period.
K. Impairment of Non-Financial Assets
As at each Balance Sheet date, the Company assesses whether there is an indication that a non-financial asset may be impaired and
also whether there is an indication of reversal of impairment loss recognized in the previous periods. If any indication exists,
or when annual impairment testing for an asset is required, the Company determines the recoverable amount and impairment
loss is recognized when the carrying amount of an asset exceeds its recoverable amount.
Recoverable amount is determined: - In case of an individual asset, at the higher of the assets' fair value less cost to sell and
value in use; and - In case of cash generating unit (a group of assets that generates identified, independent cash flows), at the
higher of cash generating unit's fair value less cost to sell and value in use. In assessing value in use, the estimated future cash
flows are discounted to their present value using pre-tax discount rate that reflects current market assessments of the time
value of money and risk specified to the asset. In determining fair value less cost to sell, recent market transaction are taken
into account. If no such transaction can be identified, an appropriate valuation model is used.
Impairment losses of continuing operations, including impairment on inventories, are recognized in the Statement of Profit
and Loss, except for properties previously revalued with the revaluation taken to OCI. For such properties, the impairment is
recognized in OCI up to the amount of any previous revaluation.
When the Company considers that there are no realistic prospects of recovery of the asset, the relevant amounts are written
off. If the amount of impairment loss subsequently decreases and the decrease can be related objectively to an event occurring
after the impairment was recognized, then the previously recognized impairment loss is reversed through the Statement of
Profit and Loss.
L. Inventories
Inventories of Finished Goods, Raw-Material, Work-in-Progress are valued at cost or net realizable value, whichever is
lower. Stores & Spares and Packing Materials are valued at cost. Cost comprises of all cost of purchases and other costs
incurred in bringing the inventory to their present location and conditions. Cost is arrived at on weighted average basis. Due
allowance is estimated and made for defective and obsolete items, wherever necessary, based on the past experience.
Net realizable value is the estimated selling price in the ordinary course of business, less estimated costs of completion and
estimated costs necessary to make the sale.
Obsolete, slow moving, surplus and defective stocks are identified at the time of physical verification of stocks and where
necessary, provision is made for such stocks. Due to Lockdown created to tackle COVID-19 pandemic Physical verification
of inventories was possible only up to certain extent. The valuation of Inventory is done on the best estimate of the
Management
M. Trade receivables
A receivable is classified as a ‘trade receivable ’ if it is in respect of the amount due on account of goods sold or services rendered
in the normal course of business. Trade receivables are recognized initially at fair value and subsequently measured at amortized
cost using the EIR method, less provision for impairment.
N. Trade payables
A payable is classified as a ‘trade payable’ if it is in respect of the amount due on account of goods purchased or services
received in the normal course of business. These amounts represent liabilities for goods and services provided to the
Company prior to the end of the financial year which are unpaid. These amounts are unsecured and are usually settled as per the
payment terms stated in the contract. Trade and other payables are presented as current liabilities unless payment is not due
within 12 months after the reporting period. They are recognized initially at their fair value and subsequently measured at
amortized cost using the EIR method.
As per Management representation no creditors has submitted MSME registration certificate with the Company and as per
the Management knowledge none of the creditors are registered under MSME.
O. Earnings Per Share
Basic earnings per share is computed by dividing the net profit or loss for the period attributable to the equity shareholders
of the Company by the weighted average number of equity shares outstanding during the period. The weighted average
number of equity shares outstanding during the period and for all periods presented is adjusted for events, such as bonus
shares, other than the conversion of potential equity shares that have changed the number of equity shares outstanding,
without a corresponding change in resources.
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