This note provides a list of the significant accounting policies
adopted in the preparation of these financial statements. These
policies have been consistently applied to all the years presented,
unless otherwise stated.
3.1 Income
(i) Interest Income
The Company recognizes interest income using
Effective Interest Rate (EIR) on all financial assets
subsequently measured at amortized cost or fair
value through other comprehensive income
(FVOCI). EIR is calculated by considering all costs
and incomes attributable to acquisition of a
financial asset or assumption of a financial liability
and it represents a rate that exactly discounts
estimated future cash payments/receipts through
the expected life of the financial asset/financial
liability to the gross carrying amount of a financial
asset or to the amortized cost of a financial liability.
Interest on financial assets subsequently
measured at fair value through profit or loss
(FVTPL) is recognized at the contractual rate of
interest.
(ii) Dividend Income
Dividend income on equity shares is recognized
when the Company's right to receive the payment
is established, which is generally when
shareholders approve the dividend. During the
year the Company has not received any income
from dividend.
3.2 Expenditures
(i) Finance costs
Borrowing costs on financial liabilities are
recognized using the Effective Interest Rate (EIR).
3.3 Cash and cash equivalents
Cash and cash equivalents include cash on hand, other
short term, highly liquid investments with original
maturities of three months or less that are readily
convertible to known amounts of cash and which are
subject to an insignificant risk of changes in value.
Cash Flow Statement
Cash flows are reported using the indirect method,
whereby profit for the period is adjusted for the effects of
transactions of a non-cash nature, any deferrals or
accruals of past or future operating cash receipts or
payments and item of income or expenses associated with
investing or financing cash flows. The cash flows from
operating, investing and financing activities of the
Company are segregated.
3.4 Financial Assets
Financial assets include cash, or an equity instrument of
another entity, or a contractual right to receive cash or
another financial asset from another entity. Few examples
of financial assets are loan receivables, investment in
equity and debt instruments, trade receivables, cash and
cash equivalents
All Financial assets are recognized initially at fair value
plus, in the case of financial assets not recognised at fair
value through profit and loss, transaction costs that are
attributable to the acquisition of the financial asset.
Financial assets are subsequently measured at amortised
cost using effective interest rate method (EIR)
3.5 Financial Liabilities
Financial liabilities include liabilities that represent a
contractual obligation to deliver cash or another financial
assets to another entity, or a contract that may or will be
settled in the entities own equity instruments. Few
examples of financial liabilities are trade payables, debt
securities and other borrowings and subordinated debts.
3.6 Taxes
(i) Current Tax
Current tax assets and liabilities are measured at
the amount expected to be recovered from or paid
to the taxation authorities, in accordance with the
Income Tax Act, 1961 and the Income
Computation and Disclosure Standards (ICDS)
prescribed therein. The tax rates and tax laws
used to compute the amount are those that are
enacted or substantively enacted, at the reporting
date.
(ii) Deferred Tax
Deferred tax is provided using the Balance Sheet
approach on temporary differences between the
tax bases of assets and liabilities and their
carrying amounts for financial reporting purposes
at the reporting date.
Deferred tax liabilities are recognized for all
taxable temporary differences and deferred tax
assets are recognized for deductible temporary
differences to the extent that it is probable that
taxable profits will be available against which the
deductible temporary differences can be utilized.
The carrying amount of deferred tax assets is
reviewed at each reporting date and reduced to
the extent that it is no longer probable that
sufficient taxable profit will be available to allow all
or part of the deferred tax asset to be utilized.
Unrecognized deferred tax assets, if any, are
reassessed at each reporting date and are
recognized to the extent that it has become
probable that future taxable profits will allow the
deferred tax asset to be recovered.
Deferred tax assets and liabilities are measured at
the tax rates that are expected to apply in the year
when the asset is realized or the liability is settled,
based on tax rates (and tax laws) that have been
enacted or substantively enacted at the reporting
date.
Deferred tax assets and deferred tax liabilities are
offset if a legally enforceable right exists to set off
current tax assets against current tax liabilities
and the deferred taxes relate to the same taxable
entity and the same taxation authority.
3.7 Property, Plant and Equipment
Property, plant and equipment are carried at historical cost
of acquisition less accumulated depreciation and
impairment losses, consistent with the criteria specified in
Ind AS 16 'Property, Plant and Equipment'.
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