1.1 Company’s Overview
M/S SGN TELECOMS LIMITED is a public limited company incorporated and domiciled in India has its works / principal place of business at E -58 Phase- VIII Indl area Mohali India and registered office at E -58 Phase-VIII Indl area Mohali
SGN TELECOMS LIMITED is in the business of manufacturing Cable components and but no activity has taken place during the year. The Shares of the Company are listed on BSE Limited.
1.2 Basis of Preparation and Presentation
These financial statements are prepared in accordance with Indian Accounting Standards (Ind AS) under the historical cost convention on the accrual basis except for certain financial instruments, which are measured at fair values. The financial statements of the Company have been prepared to comply with the Indian Accounting standards („lnd AS"), including the rules notified under the relevant provisions of the Companies Act, 2013.
The financial statements are approved by the Company"s Board of Directors and authorised for issue on 27.05.2024.
1.3 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:
i) expected to be realized or intended to be sold or consumed in normal operating cycle,
ii) held primarily for the purpose of trading,
iii) expected to be realized within twelve months after the reporting period,
iv) cash or cash equivalent unless restricted from being exchanged or used to settle a liability for at least twelve months after the reporting period, or
v) carrying current portion of non-current financial assets.
All other assets are classified as non-current.
A liability is current when:
i) it is expected to be settled in normal operating cycle,
ii) it is held primarily for the purpose of trading,
iii) it is due to be settled within twelve months after the reporting period,
iv) there is no unconditional right to defer the settlement of the liability for at least twelve months after the reporting period, or
v) it includes current portion of non-current financial liabilities.
All other liabilities are classified as non-current.
1.4 Property, Plant and Equipment
i) Property, plant and equipment are stated at cost of construction or acquisition, less accumulated depreciation and impairment losses, if any. 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 entity and the cost can be measured reliably.
ii) When an asset is scrapped, or otherwise disposed off, the cost and related depreciation are removed from the books of account and resultant profit (including capital profit) or loss, if any, is reflected in Profit and Loss Account.
iii) Depreciation on Tangible Assets (except Land) is provided on Straight Line Method, pro-rata monthly rests, as per the life prescribed in Schedule II of the Companies Act, 2013 except for fixed assets mentioned in para (iv) below, based on the Company"s expected usage Pattern supported by technical assessment
Nature of Assets Life adopted in Accounts
a) Patterns, Blocks and Dies 4 Years
b) Vehicles 4 Years
iv) The assets" residual value, useful lives and methods of depreciation are reviewed at each financial year end, and adjustment if any, is made prospectively.
1.5 Investment Properties
Investment Properties are properties held to earn rentals and/or for capital appreciation. Investment properties are measured at cost and the same is derecognized upon disposal or when it is permanently withdrawn from use with no future economic benefits are expected from the disposal.
Depreciation is provided on Straight Line Method, pro-rata monthly rests, as per the life prescribed for Building in Schedule II of the Companies Act, 2013.
1.6 Inventories
Inventories are valued at cost or net realizable value, whichever is lower. Cost of inventories comprises of cost of purchase, cost of conversion and other costs including manufacturing overheads and is ascertained on weighted average basis, net of recoverable taxes incurred in bringing them to their respective present location and condition. Cost of raw materials and stores and spares are determined on weighted average basis.
1.7 Foreign Currency Transactions
Foreign currency transactions are recorded at the rates of exchange prevailing on the date of transaction. Monetary foreign currency assets and liabilities outstanding at the close of the financial year are revalued at the exchange rates prevailing on the balance sheet date. Exchange differences arising on account of fluctuation in the rate of exchange is recognized in the statement of profit and loss.
Non-monetary items that are measured in terms of historical cost in a foreign currency are translated using the exchange rates at the dates of the initial transactions.
1.8 Employee Benefit
Company’s contributions paid/payable during the year to Employee State Insurance Corporation and Labour Welfare Fund are recognized in the Statement of Profit and Loss.
Company contributes to the appropriate authorities its share of the Members Provident Fund Account as per the Employees" Provident Fund Act, 1952.
Company contributes to a trust, which has taken Master Policy with the Life Insurance Corporation of India to cover its liability towards employees" gratuity. Provisions in respect of liabilities of gratuity and leave encashment are made based on actuarial valuation made by an independent actuary as at the balance sheet date. Gains and Losses through re-measurements of the net defined benefit liability are recognized in other comprehensive income. The actual return of the plan assets, in excess of the yields computed by applying the discount rate used to measure the defined benefit obligation is recognized in other comprehensive income.
In respect of Employee Stock Option Scheme:
The compensation cost of stock options granted to employees is measured by the Fair Value Method. The fair value, determined at the grant date of the underlying equity shares, is recognized and amortised on straight line basis over the vesting period.
1.9 Revenue Recognition
The Ministry of Corporate Affairs notified Ind AS 115 “Revenue from Contracts with Customers’’ in respect of accounting periods commencing on or after April 1, 2018, superseding Ind AS 11 “Construction Contracts” and Ind AS 18 “Revenue”.
The Company's current revenue recognition policy is aligned to the principles enunciated in Ind AS 115 which is effective from April 1, 2018.
The company recognizes revenue from contracts with customers when it satisfies a performance obligation by transferring a promised good or service to a customer. The revenue is recognized to the extent of transaction price allocated to the performance obligation satisfied.
Transaction price is the amount of a consideration to which the Company expects to be entitled in exchange for transferring good or service to a customer. Payment terms agreed with a customer are as per business practice and there is no financing component involved in the transaction price.
Revenue from operations
Revenue for the periods upto June 30, 2017 includes excise duty collected from customers. Revenue from July 1, 2017 onwards is exclusive of goods and service tax (GST) which subsumed excise duty
Sale of goods
Revenue from sale of goods is recognized when the control of the same is transferred to the customer and it is probable that the Company will collect the consideration to which it is entitled in exchange of goods.
Rendering of services
Revenue from rendering services is recognized when performance obligation is satisfied and customer obtains the control of the transferred services. Following criteria is required to be met for transfer of control of services:
i) the customer simultaneously receives and consumes the benefits from the services transferred.
ii) the Company has an enforceable right to payment for services transferred.
Other Operational Revenue
Other operational revenue represents income earned from the activities incidental to the business and is recognized when the right to receive the income is established as per the terms of the contract.
Other income
Dividend income from investments is recognized when the right to receive payment has been established.
Interest income is recognized when it is probable that the economic benefits will flow to the Company and the amount of income can be measured reliably. Interest income is accrued on a time basis, by reference to the deposits and at the interest rate settled with the Bank.
1.10lntangible Assets
Intangible assets are carried at cost and amortized on Straight line method, so as to reflect the pattern in which the assets economic benefits are consumed.
Intangible Asset under Development.
The expenses incurred on development phase are initially recognized as Intangible assets under development until the development phase is complete, upon which the amount is capitalized as intangible asset.
i) Development expenditure:
Development expenditure incurred on technical services and other project/product related expenses are amortized over the estimated period of benefit, not exceeding five years. Amortization commences as and when the asset is available for use.
ii) Software Expenditure:
Software Expenditure incurred is amortized on pro-rata basis over a period not exceeding four years, commencing from the year in which the expenditure is incurred.
1.11 Taxes on Income
Current tax is determined as the amount of tax payable in respect of the taxable income for the year.
Deferred tax is recognised on temporary differences between the carrying amount of assets and liabilities in the financial statements and the corresponding tax bases used in the computation of taxable profit. Deferred tax liabilities are generally recognised for all taxable temporary differences. Deferred tax assets are generally recognised for all deductible temporary differences to the extent that it is probable that taxable profits will be available against which those deductible temporary differences can be utilised.
Deferred tax liabilities and assets are measured at the tax rates that are expected to apply in the period in which the liability is settled or the asset realised, based on tax rates (and tax laws) that have been enacted or substantively enacted by the end of the reporting period.
1.12Financial Instrument Financial Assets
Initial recognition and measurement
All financial assets and liabilities are initially recognized at fair value. Transaction costs that are directly attributable to the acquisition or issue of financial assets and financial liabilities, which are not at fair value through profit or loss, are adjusted to the fair value on initial recognition.
Subsequent measurement
Financial assets carried at amortised cost (AC)
A financial asset is measured at amortised cost if it is held within a business model whose objective is to hold the asset 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. For trade receivables and other financial assets maturing within one year from the balance sheet date, the carrying amounts approximate fair value due to the short maturity of these instruments.
Financial assets at fair value through other comprehensive income (FVTOCI)
A financial asset is measured at FVTOCI if it is held within a business model whose objective is achieved by both collecting contractual cash flows and selling 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.
Financial assets at fair value through profit or loss (FVTPL)
A financial asset which is not classified in any of the above categories are measured at FVTPL.
Financial liabilities
Initial recognition and measurement
All financial liabilities are recognized at fair value.
Subsequent measurement
Financial liabilities are carried at amortized cost using the effective interest method. For trade and other payables maturing within one year from the balance sheet date, the carrying amounts approximate fair value due to the short maturity of these instruments.
Derecognition of financial instruments
The Company derecognizes a financial asset when the contractual rights to the cash flows from the financial asset expire ort transfers the financial asset and the transfer qualifies for derecognition under Ind AS 109. A financial liability (or a part of a financial liability) is derecognized from the Company's Balance Sheet when the obligation specified in the contract is discharged or cancelled or expires.
1.13 Impairment of Assets
The carrying value of assets at each balance sheet date are reviewed for Impairment. If any indication exists, the recoverable amount of such assets is estimated and impairment is recognized if the carrying amount of these assets exceeds their recoverable amount.
|