1. Corporate information
Ultracab (India) Limited (the 'Company') is a public limited company domiciled in India. Its shares
are listed on the Bombay Stock Exchange ('BSE'). The Company is mainly engaged in the business
of manufacturing and exporting of electric wires and cables.
2. Summary of basis of compliance, basis of preparation and presentation, critical accounting
estimates, assumptions and judgements and significant accounting policies
2.1 Basis of preparation of financial statements
The financial statements of the company have been prepared in accordance with Indian
Accounting Standards (Ind AS) notified under companies (Indian accounting standards) Rules,
2015 (as amended from time to time) and presentation requirements of Division II of Schedule
III to the Companies Act, 2013, (Ind AS compliant Schedule III), as applicable to the company.
2.2 Basis of preparation and presentation
The Company follows the mercantile system of accounting and recognises income and
expenditure on an accrual basis except in case of significant uncertainties.
The Standalone Financial Statements have been prepared on the historical cost basis.
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.
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 the Schedule III to the Act.
2.3 Critical accounting estimates, assumptions and judgements
The preparation of the Standalone Financial Statements requires management to make
estimates, assumptions and judgments that affect the reported balances of assets and
liabilities and disclosures as at the date of the Standalone Financial Statements and the
reported amounts of income and expense for the periods presented.
The estimates and associated assumptions are based on historical experience and other
factors that are considered to be relevant. Actual results may differ from these estimates
considering different assumptions and conditions.
Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to
accounting estimates are recognised in the period in which the estimates are revised and
future periods are affected.
The estimates and assumptions that have a significant risk of causing a material adjustment to
the carrying values of assets and liabilities within the next financial year are discussed below.
2.3.1 Deferred income tax assets and liabilities
Significant management judgment is required to determine the amount of deferred
tax assets that can be recognised, based upon the likely timing and the level of future
taxable profits.
The amount of total deferred tax assets could change if management estimates of
projected future taxable income or if tax regulations undergo a change.
2.3.2 Useful lives of property, plant and equipment ('PPE') and intangible assets
Management reviews the estimated useful lives and residual value of PPE and
Intangibles at the end of each reporting period. Factors such as changes in the
expected level of usage, technological developments and product lifecycle, could
significantly impact the economic useful lives and the residual values of these assets.
Consequently, the future depreciation charge could be revised and may have an
impact on the profit of the future years.
2.3.3 Employee benefit obligations
Employee benefit obligations are determined using actuarial valuations. An actuarial
valuation involves making various assumptions that may differ from actual
developments. These include the estimation of the appropriate discount rate, future
salary increases and mortality rates. Due to the complexities involved in the valuation
and its long-term nature, the employee benefit obligation is highly sensitive to changes
in these assumptions. All assumptions are reviewed at each reporting date.
|