Material Accounting Policies
1.1 Basis of Preparation and Presentation
(a) Statement of Compliance
The standalone financial statements of the Company as at and for the year ended 31st March, 2025 have been
prepared and presented in accordance with Indian Accounting Standards ("Ind AS") notified under Section 133 of the
Companies Act, 2013 ("the Act") and presentation requirements of Division II of Schedule III to the Companies Act,
2013 as amended from time to time, guidelines issued by the Securities and Exchange Board of India (SEBI) and other
relevant provisions of the Act and accounting principles generally accepted in India.
(b) Basis of Measurement
The standalone financial statements have been prepared on a historical cost convention and on an accrual basis of
accounting, except for the following assets and liabilities which have been measured at fair value:
Ý Financial Assets and Liabilities are measured at fair value or at amortised cost depending on the classification;
Ý Asset held for sale measured at fair value less cost to sell;
Ý Lease liabilities and Right of Use Asset; and
Ý Share based payments.
Historical cost is generally based on the fair value of the consideration given in exchange for goods and services. Fair
value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between
market participants at the measurement date.
For financial reporting purposes, 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:
Ý Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities that the entity can
access at the measurement date;
Ý Level 2 inputs are inputs, other than quoted prices included within Level 1, that are observable for the asset or
liability, either directly or indirectly; and
Ý Level 3 inputs are unobservable inputs for the asset or liability.
(c) Consistency of Accounting Policy
The accounting policies are applied consistently to all the periods presented in the financial statements, except where
a newly issued accounting standard is initially adopted or a revision to an existing standard requires a change in the
accounting policy hitherto in use.
(d) Functional Currency and Rounding of amounts
The standalone financial statements are presented in INR (T) which is also the functional currency of the Company and
all the values are rounded off to the nearest million (INR 000,000) except when otherwise indicated.
1.2 Current and Non-Current classification
The Company presents assets and liabilities in the balance sheet based on current/non-current classification. An asset is
classified as current if:
(a) it is expected to be realized or sold or consumed in the Company's normal operating cycle;
(b) it is held primarily for the purpose of trading;
(c) it is expected to be realized within twelve months after the reporting period; or
(d) it is cash or a cash equivalent unless it is restricted from being exchanged or used to settle a liability for at least twelve
months after the reporting period.
All other assets are classified as non-current.
A liability is classified as current if:
(a) it is expected to be settled in normal operating cycle;
(b) it is held primarily for the purpose of trading;
(c) it is expected to be settled within twelve months after the reporting period;
(d) it has no unconditional right to defer the settlement of the liability for at least twelve months after the reporting
period.
All other liabilities are classified as non-current.
The operating cycle is the time between acquisition of assets for processing and their realization in cash and cash equivalents.
The Company's normal operating cycle is twelve months.
1.3 Use of estimates, assumptions and judgements
The preparation of the standalone financial statements in conformity with Ind AS requires the Management to make
estimates, judgement and assumptions. These estimates, judgements and assumptions affect the application of accounting
policies and the reported amounts of assets and liabilities, the disclosures of contingent assets and liabilities at the date
of the financial statements and reported amounts of revenue and expenses during the period. Application of accounting
policies requires critical accounting estimates involving complex and subjective judgements. Accounting estimates could
change from period to period. Actual results could differ from those estimates. Appropriate changes in estimates are made
as the Management becomes aware of changes in circumstances surrounding the estimates. Changes in estimates are
reflected in the standalone financial statements in the period in which changes are made and, if material, their effects
are disclosed in the notes to the standalone financial statements. Application of accounting policies that require critical
accounting estimates involving judgements and the use of assumptions in the standalone financial statements have been
disclosed below:
(a) Revenue Recognition
The Company uses the percentage of completion method in the accounting for its fixed-price contracts. The use of
the percentage of completion method requires the Company to estimate the efforts or costs to be expended till the
reporting date as a proportion of the total efforts or costs to be expended. Efforts or costs expended have been used to
measure progress towards completion as there is a direct relationship between input and productivity. Provisions for
estimated losses, if any, on uncompleted contracts are recorded in the period in which such losses become probable,
based on the expected contract estimates at the reporting date.
(b) Useful lives of property, plant and equipment
The Company reviews the useful life of property, plant and equipment at the end of each reporting period. This
reassessment may result in change in depreciation expense in future periods.
(c) Impairment of Investments of subsidiaries
Determining whether the investments in subsidiaries are impaired requires an estimate in the value in use of
investments. The Company reviews its carrying value of investments carried at cost annually, or more frequently when
there is an indication for impairment.
The carrying amount of investment is tested for impairment as a single asset by comparing its value in use with its
carrying amount, any impairment loss recognised reduces the carrying amount of investment.
In considering the value in use, the Board of directors have anticipated the future market conditions and other
parameters that affect the operations of these entities including operating results, business plans, future cash flows
and economic conditions and key assumptions such as estimated long term growth rates, weighted average cost
of capital and estimated operating margins. Cash flow projections take into account past experience and represent
management's best estimate about future developments.
(d) Allowance for trade receivables and other financial assets
The impairment provisions for trade receivables are based on assumptions about risk of default and expected loss rates.
The Company uses judgement in making these assumptions and selecting the inputs to the impairment calculation,
based on Company's past history, credit risk, existing market conditions as well as forward looking estimates at the end
of each reporting period. 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. The Company
uses judgement in making these assumptions and selecting the inputs to the impairment calculation, based on the
Company's past history of collections, customer's credit-worthiness, existing market conditions as well as forward
looking estimates at the end of each reporting period.
(e) Share-based payments
Estimating fair value for share-based payment transactions requires determination of the most appropriate valuation
model, which is dependent on the terms and conditions of the grant. This estimate also requires determination of the
most appropriate inputs to the valuation model including the expected life of the share option, volatility and dividend
yield and making assumptions about them.
(f) Defined benefit plans
The cost of the defined benefit gratuity plan, compensated absences and the present value of the defined benefit
obligation are determined based on an actuarial valuation carried out by an independent actuary using the
projected unit credit method. An actuarial valuation involves making various assumptions that may differ from actual
developments in the future. These include the determination of the discount rate, future salary increases, future
attrition rates and mortality rates. Due to the complexities involved in the valuation, the underlying assumptions and
its long-term nature, a defined benefit obligation is highly sensitive to changes in these assumptions. All assumptions
are reviewed at each reporting date.
(g) Fair value measurement of financial instruments
When the fair values of financial assets and financial liabilities recorded in the balance sheet cannot be measured
based on quoted prices in active markets, the fair value is measured using appropriate valuation techniques. The
inputs to these models are taken from observable sources where possible, but where this is not feasible, a degree of
judgement is required in establishing fair values. Judgements include considerations of inputs such as liquidity risk,
credit risk and volatility. Changes in assumptions about these factors could affect the reported fair value of financial
instruments.
(h) Taxes
The Company's major tax jurisdictions are in India. Uncertainties exist with respect to the interpretation of complex tax
regulations, changes in tax laws, and the amount and timing of future taxable income of the Company's operations in
India. The Company establishes provisions, based on reasonable estimates, for possible consequences of audits by the
tax authorities and reflects uncertainties relating to income taxes, if any. The amount of such provisions is based on
various factors, such as experience of previous tax audits and differing interpretations of tax regulations by the taxable
entity and the responsible tax authority. A tax assessment could involve complex issues, which can only be resolved
over extended time periods. Deferred tax assets are recognized for unused tax losses to the extent that it is probable
that future taxable profit will be available against which the losses can be utilized. Significant management judgement
is required to determine the amount of deferred tax assets that can be recognized, based upon the likely timing and
the level of future taxable profits.
(i) Leases
The Company evaluates if an arrangement qualifies to be a lease based on the requirements of the relevant standard.
Identification of a lease requires significant management judgement. Computation of the lease liabilities and right-to-
use assets requires management to estimate the lease term (including anticipated renewals), and the applicable discount
rate. Management estimates the lease term based on the non-cancellable lease-term, options for future renewals if the
Company is reasonably certain to exercise and options to terminate the lease if the Company is reasonably certain
not to exercise. In performing this assessment, the discount rate is generally based on the incremental borrowing rate
specific to the lease being evaluated or for a portfolio of leases with similar characteristics.
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