2. SIGNIFICANT ACCOUNTING POLICIES:
2.1 BASIS OF PREPARATION:
The financial Statements of the Company have been prepared in accordance with Indian Accounting Standards (Ind AS) notified pursuant to section 133 of the Companies Act, 2013 ('the Act'), read with Rule 3 of the Companies (Indian Accounting Standards) Rules, 2015 and Companies (Indian Accounting Standards) Amendment Rules, 2016.
The financial statements of the Company for the year ended 31st March, 2023 were approved for issue in accordance with the resolution of the Board of Directors on 18/05/2023.
The statements have been prepared under the historical cost convention.
2.2 CURRENT AND NON CURRENT CLASSIFICATION:
All assets and liabilities have been classified as current or non-current as per the Company's normal operating cycle and other criteria set out in Schedule III to the Act Based on the nature of the products and the time between acquisition of assets for processing and their realization in cash and cash equivalents, the Company has ascertained its normal operating cycle as twelve months for the purpose of current or non-current classification of the assets and liabilities.
Deferred tax assets and liabilities are classified as non-current assets and liabilities.
2.3 SIGNIFICANT ACCOUNTING JUGEMENTS, ESTIMATES AND ASSUMTIONS:
The preparation of the financial statements in conformity with Ind AS requires management to make estimates and assumptions that affect the reported amounts of revenue, expenses, assets and liabilities. Actual results could differ from those estimates.
Estimates and judgments are reviewed on an ongoing basis. They are based on historical experience and other factors, including expectations of future events that may have a financial impact on the Company and that are believed to be reasonable under the circumstance. Revisions to accounting estimates are recognized in the period in which the estimates are revised and future periods are affected.
The key assumptions concerning the future and other key sources of estimating 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 below a) Impairment of Property, Plant and Equipment (PPE) -Not Applicable
b) Determination of the estimated useful lives -Not applicable
c) Current and deferred taxes
Significant management judgment is required to determine the amount of current and deferred taxes that can be recognized, based upon the likely timing and the level of future taxable profit together with future tax planning strategies.
The operating cycle is the time between the acquisition of assets for processing and their realization in cash and cash equivalents. The Company has identified twelve months as its operating cycle. No Provision for Current Tax has been made due to inadequacy of profit during the year. Deferred Tax can only be created if company reliably estimates sufficient future taxable income.
2.4 PROPERTY, PLANT AND EQUPMET: Not applicable
a) DEPRECIATION / AMORTIZATION: Not Applicable
b) IMPAIRMENT: Not Applicable.
2.5 INVENTORIES:
Inventories of Stocks are valued at Cost.
2.6 FOREIGN CURRENCEY TRANSACTIONS: - NA
2.7 CASH AND CASH EQUIVALENTS:
Cash and cash equivalent include cheques in hand, cash at bank and deposits with banks having original maturity of not more than three months. Bank deposits with original maturity period of more than three months but less than twelve months are classified as other bank balances.
2.8 FINANCIAL INSTRUMENTS:
A financial instrument is any contract that gives rise to financial assets of one entity and a financial liabilities or equity instrument of another entity.
Financial Assets
Initial recognition and measurement
All financial assets are recognized initially at cost.
Subsequent measurement
All recognized financial assets are subsequently measured in their entity either amortised cost or fair value depending on the classification of the financial assets.
Financial Liabilities
Initial recognition and measurement
All financial liabilities are recognized initially a fair value and, in the case of loans and borrowings and payables, net of directly attributable transaction costs.
The Company's financial liabilities include trade and other payables and borrowings including bank overdrafts.
Subsequent measurement
Financial liabilities at fair value through profit and loss.
Gains or losses on liabilities held for trading are recognized in the statement of profit and loss. Derecognition of Financial Assets and Liabilities -Not Applicable
2.9 REVENUE RECOGNITION:
Revenue is recognized to the extent it is probable that the economic benefits will flow to the Company and the revenue can be reliably measured. Revenue is measured at the fair value of the consideration received or receivable and represents receivable for goods and services provided in the normal course of business, net of discount and taxes:
i. Revenue from sales of goods is recognized on transfer of significant risk and rewards of ownership of products to the customers.
ii, Interest income is accounted for on a time proportion basis taking into account the amount outstanding and the rate applicable.
1.10 EMPLOYEMENT BENEFITS: Not applicable
2.11 INCOME AND DEFERRED TAXES:
TAXATION:
I] CURRENT TAX
Provision for Current income tax liability is made on estimated taxable income under Income Tax Act, 1961 after considering permissible tax exemption, deductions and disallowances.
II] DEFFERED TAX
Deferred tax resulting from timing difference between book and tax profits is accounted for under the liability method, at the current rate of tax to the extent that the timing difference are expected to crystallize. DTA can be realized only when the company reliably estimates sufficient future taxable income.
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