6. MATERIAL ACCOUNTING POLICIES:
a. Property, plant and equipment:
All items of Property, plant and equipment other than freehold land are carried at cost less accumulated depreciation
and accumulated impairment loss, if any. Freehold land is stated at revalued amount.
Revaluation of Land is made with sufficient regularity to ensure that the carrying amount does not differ materially
from that which would be determined using fair value at the balance sheet date. When the fair value differs materially
from its carrying amount, the carrying amount is adjusted to the revalued amount. The fair value is determined based
on appraisal undertaken by a professionally qualified valuer.
Cost includes cost of acquisition, installation or construction, other direct expenses incurred to bring the assets to its
working condition and finance costs incurred up to the date the asset is ready for its intended use and excludes GST
eligible for credit/setoff, wherever applicable.
When significant parts of plant and equipment are required to be replaced at intervals, the Company depreciates
them separately based on their specific useful lives. Likewise, when a major inspection is performed, its cost is
recognised in the carrying amount of the plant and equipment as a replacement if the recognition criteria are satisfied.
All other repair and maintenance costs are recognised in the statement of profit or loss as incurred.
Capital work-in-progress in respect of assets which are not ready for their intended use are carried at cost, comprising
of direct costs, related incidental expenses and attributable interest.
All identifiable Revenue expenses including interest incurred in respect of various projects/expansion, net of income
earned during the project development stage prior to its intended use, are considered pre-operative expenses and
disclosed under Capital Work-in-Progress.
Capital expenditure on tangible assets for research and development is classified under property, plant and equipment
and is depreciated on the same basis as other property, plant and equipment.
Property, plant and equipment are derecognised either on disposal or when retires from active use. Losses arising
in the case of the retirement of property, plant and equipment and gains or losses arising from disposal of property,
plant and equipment are recognised in the statement of profit and loss in the year of occurrence.
Depreciation & Amortisation:
Depreciable amount for assets is the cost of an asset, or other amount substituted for cost, less its estimated
residual value. Depreciation on the property, plant and equipment is provided based on straight line method, over
the useful life of the assets as specified in Schedule II to the Companies Act, 2013. Property, plant and equipment
which are added / disposed off during the year, depreciation is provided on pro-rata basis. Right-of-use assets are
depreciated from the commencement date/Revaluation date on a straight-line basis over the shorter of the lease term
and balance useful life of the underlying asset. Buildings constructed on leasehold land are depreciated based on the
useful life specified in Schedule II to the Companies Act, 2013, where the lease period of the land is beyond the life
of the building. In other cases, building constructed on leasehold lands are amortised over the primary lease period
of the lands.
The assets' residual values, useful lives and methods of depreciation are reviewed at each financial year end and
adjusted prospectively, if appropriate.
An asset's carrying amount is written down immediately to its recoverable amount if the asset's carrying amount is
greater than its estimated recoverable amount. Advances given towards acquisition of Property, plant and equipment
outstanding at Balance sheet date are disclosed as Capital Advances under “Non Current Assets - Others”.
b. Intangible Assets:
Intangible assets are recognised when it is probable that the future economic benefits that are attributable to the
assets will flow to the Company and the cost of the assets can be measured reliably.
Intangible assets are stated at cost of acquisition less accumulated amortisation and impairment loss, if any.
Internally generated intangibles, excluding development costs as defined in Ind AS, are not capitalised and the
related expenditure is reflected in statement of profit and loss in the period in which the expenditure is incurred.
Software is amortised over their estimated useful life on straight line basis from the date they are available for
intended use or the period of the license as applicable, subject to impairment test.
The amortisation period and the amortisation method for an intangible asset with a finite useful life are reviewed at
least at the end of each reporting period. Changes in the expected useful life or the expected pattern of consumption
of future economic benefits embodied in the asset are considered to modify the amortisation period or method, as
appropriate, and are treated as changes in accounting estimates.
Gains or losses arising from derecognition of an intangible assets are measured as the difference between the net
disposal proceeds and the carrying amount of the asset and are recognised in the statement of profit and loss when
the assets is derecognised.
Research and Development:
Revenue expenditure pertaining to research is charged to the Statement of Profit and Loss. Development costs of
products are also charged to the Statement of Profit and Loss in the year it is incurred, unless a product's technological
feasibility has been established, in which case such expenditure is capitalized. These costs are charged to the
respective heads in the Statement of Profit and Loss in the year it is incurred. The amount capitalized comprises of
expenditure that can be directly attributed or allocated on a reasonable and consistent basis for creating, producing
and making the asset ready for its intended use. Property, plant and equipment and Other Intangible Assets utilized
for research and development are capitalized and depreciated/ amortised in accordance with the policies stated for
Property, plant and equipment and Other Intangible Assets.
c. Non-Current assets held for sale:
The Company classifies non-current assets as held for sale if their carrying amounts will be recovered principally
through a sale rather than through continuing use and a sale is considered highly probable. Non-current assets as
held for sale are measured at the lower of their carrying amount and the fair value less costs to sell. These assets are
presented separately in balance sheet. Property, plant and equipment are not depreciated once classified as held for
sale.
d. Impairment of Non-Financial Assets:
The carrying amount of Non-Financial Assets (other than inventories and deferred tax assets )/ Cash Generating
Units ('CGU') are reviewed at each Balance Sheet date if there is any indication of impairment based on internal /
external factors. An impairment loss is recognised in the Statement of Profit and Loss wherever the carrying amount
of a Non-Financial Assets /CGU exceeds its recoverable amount, unless the amount is carried at revalued amount, in
which case any impairment loss of the revalued asset is treated as a revaluation decrease to the extent a revaluation
reserve is available for that asset. The recoverable amount is greater of the asset's net selling price and value in
use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax
discount rate that reflects current market assessments of the time value of money and risks specific to the assets.
A previously recognised impairment loss is increased or reversed depending on the changes in circumstances.
However, the carrying value after reversal is not increased beyond the carrying value that would have prevailed by
charging usual depreciation / amortization, if there was no impairment.
e. Financial Instruments:
A financial instrument is any contract that gives rise to a financial asset of one entity and a financial liability or equity
instrument of another entity.
Financial Assets:
Classification:
The Company classifies financial assets as subsequently measured at amortised cost, fair value through other
comprehensive income ('FVTOCI') or fair value through profit or loss ('FVTPL'), on the basis of its business model for
managing the financial assets and the contractual cash flow characteristics of the financial asset.
Initial recognition and measurement:
All financial assets except Trade Receivable are recognized at fair value, plus in case of financial assets not recorded at fair
value through profit or loss) are recognised initially at fair value plus transaction costs that are attributable to the acquisition
of the financial asset. However, Company's trade receivables that do not contain a significant financing component are
measured at transaction price under Ind AS 115 “Revenue from Contracts with Customers”.
Purchases or sales of financial assets including mutual fund that require delivery of assets within a time frame established
by regulation or convention in the market place (regular way trades) are recognised on the trade date, i.e. the date that the
Company commits to purchase or sell the asset.
Subsequent measurement:
For the purpose of subsequent measurement, financial assets are classified in two broad categories:
• Financial assets at fair value (FVTPL/FVTOCI)
• Financial assets at amortised cost
When assets are measured at fair value, gains and losses are either recognised in the statement of profit and loss (i.e.
fair value through profit or loss- FVTPL), or recognised in other comprehensive income (i.e. fair value through other
comprehensive income -FVTOCI).
Financial Assets measured at amortised cost (net of write down for impairment, if any):
Financial assets are measured at amortised cost when asset is held within a business model, whose objective is to hold
assets for collecting contractual cash flows and contractual terms of the asset give rise on specified dates to cash flows that
are solely payments of principal and interest. Such financial assets are subsequently measured at amortised cost using
the effective interest rate (EIR) method less impairment, if any. The losses arising from impairment are recognised in the
statement of profit and loss.
Financial assets measured at Fair value through other comprehensive income (‘FVTOCI'):
Financial assets under this category are measured initially as well as at each reporting date at fair value, when asset is held
within a business model, whose objective is to hold assets for both collecting contractual cash flows and selling financial
assets Fair value movements are recognised in the other comprehensive income.
Financial assets measured at fair value through profit or loss (‘FVTPL'):
Financial assets under this category are measured initially as well as at each reporting date at fair value with all changes
recognised in profit or loss. Financial assets that do not meet the amortised cost criteria or FVTOCI criteria are measured
at FVTPL.
Investment in Subsidiary:
Investments in subsidiaries are carried at cost less accumulated impairment losses, if any. Where an indication of impairment
exists, the carrying amount of the investment is assessed and written down immediately to its recoverable amount. On
disposal of investments in subsidiaries, the difference between net disposal proceeds and the carrying amounts are
recognized in the statement of profit and loss.
Derecognition of Financial Assets:
A financial asset is primarily derecognised when the rights to receive cash flows from the asset have expired or the
Company has transferred its rights to receive cash flows from the asset.
Impairment of Financial Assets (Other than at Fair Value):
In accordance with Ind AS 109, The Company applies expected credit loss (ECL) model for measurement and recognition
of impairment loss on financial assets measured at amortised cost and FVTOCI debt instrument.
The company follows 'simplified approach' for recognition of impairment loss allowance on trade receivables which do not
contain a significant financing component.
The application of simplified approach does not require the Company to track changes in credit risk. Rather, it recognises
impairment loss allowance based on lifetime ECLs at each reporting date, right from its initial recognition.
Financial Liabilities:
Classification:
The Company classifies all financial liabilities as subsequently measured at amortised cost or FVTPL. Such liabilities,
including derivatives that are liabilities, are subsequently measured at fair value with changes in fair value being recognised
in the Statement of Profit and Loss.
Initial recognition and measurement:
All financial liabilities are recognised initially at fair value and, in the case of loans, borrowings and payables, net of directly
attributable transaction costs.
Financial liabilities include trade and other payables, loans and borrowings including bank overdrafts and derivative
financial instruments.
Subsequent measurement:
Financial liabilities at fair value through profit or loss include financial liabilities held for trading and financial liabilities
designated upon initial recognition as at fair value through profit or loss. Interest bearing Loans and borrowings are
subsequently measured at amortised cost using the Effective Interest Rate ('EIR') method. Gains and Losses are
recognised in profit or loss when the liabilities are derecognised as well as through EIR amortization process. Amortised
cost is calculated by taking into account any discount or premium on acquisition and fees or costs that are an integral part
of the EIR. The EIR amortization is included as finance costs in the Statement of Profit & Loss.
Derecognition of Financial Liabilities:
A financial liability is derecognised when the obligation under the liability is discharged or cancelled or expires. When
an existing financial liability is replaced by another from the same lender on substantially different terms, or the terms
of an existing liability are substantially modified, such an exchange or modification is treated as the derecognition of the
original liability and the recognition of a new liability. The difference in the respective carrying amounts is recognised in the
Statement of Profit and Loss.
Derivative Financial Instrument:
Company uses derivative financial instruments, such as forward currency contracts to mitigate its foreign currency risks.
Such derivative financial instruments are initially recognised at fair value on the date on which a derivative contract is
entered into and are subsequently re-measured at fair value. Derivatives are carried as financial assets when the fair value
is positive and as financial liabilities when the fair value is negative. Any changes therein are generally recognised in the
statement of profit and loss.
Hedge Accounting:
The Company uses foreign currency forward contracts to hedge its risks associated with foreign currency fluctuations
relating to highly probable forecast transactions. The Company designates such forward contracts in a cash flow hedging
relationships by applying the hedge accounting principles. These forward contracts are stated at fair value at each reporting
date. Changes in fair value of these forward contracts that are designated and effective as hedges of future cash flows are
recognized directly in (OCI) and accumulated in 'Cash Flow Hedge Reserve Account' under Other Equity, net of applicable
deferred income taxes and the ineffective portion is recognized immediately in the Statement of Profit & Loss. Amounts
accumulated in the 'Cash Flow Hedge Reserve Account' are reclassified to the Statement of Profit & Loss in the same
period during which the forecasted transaction affects Statement of Profit & Loss. Hedge accounting is discontinued when
the hedging instrument expires or is terminated, or exercised or no longer qualifies for hedge accounting. For forecasted
transactions, any cumulative gain or loss on the hedging instrument recognised in 'Cash Flow Hedge Reserve Account'
is retained until the forecasted transaction occurs. If the forecasted transaction is no longer expected to occur, the net
cumulative gain or loss recognised in 'Cash Flow Hedge Reserve Account' is immediately transferred to the Statement of
Profit and Loss.
f. Inventories:
Raw materials and packing materials are valued at lower of cost and net realizable value, cost of which includes duties and
taxes - net of set-offable GST/Custom Duty wherever applicable. Finished products including traded goods and work-in¬
progress are valued at lower of cost and net realizable value. Cost is arrived on moving average basis.
The cost of inventories have been computed to include all cost of purchases, cost of conversion, standard overheads and
other related cost incurred in bringing the inventories to their present location and condition.
Net realisable value is the estimated selling price in the ordinary course of business, less the estimated costs of completion
and selling expenses necessary to make the sale.
Slow and non-moving material, products nearing expiry, obsolesces defective inventory are fully provided for and valued
at net realizable value.
Goods and materials in transit are valued at actual cost incurred up to the reporting date.
Materials and other items held for use in production of inventories are not written down, if the finished products in which
they will be used are expected to be sold at or above cost.
g. Cash and Cash Equivalents :
Cash and Cash Equivalents comprise of cash on hand and cash at bank including fixed deposit/highly liquid investments
with original maturity period 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. For the purpose of the statement of cash flows, cash and cash
equivalents consist of cash and short-term deposits, as defined above, as they are considered an integral part of the
Company's cash management
h. Cash Flow Statements :
Cash flows are reported using the indirect method, whereby net profit/(loss) before tax is adjusted for the effects of
transactions of a non-cash in 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 flow from operating, investing and
financing activities of the Company is segregated.
i. Foreign Currency Transactions:
Transactions denominated in foreign currencies are normally recorded at the exchange rate prevailing on the date of the
transaction.
Monetary items, denominated in foreign currencies at the reporting date are re-measured at the exchange rate prevailing
on the reporting date. Non-monetary foreign currency items denominated in foreign currency are carried at cost and not
re-measured at the exchange rate prevailing as at reporting date.
Any income or expense on account of exchange difference either on settlement or on re-measurement is recognised in the
statement of profit and loss.
j. Revenue Recognition:
The Company derives revenue primarily from sale of manufactured goods and traded goods
The Company applied Indian Accounting Standard 115 (Ind AS 115) -'Revenue from contracts with customers' and
Revenue from the sale of goods is recognised - net of returns, discounts and rebates and taxes collected from customers
- if the following conditions are met:
• The significant risks and rewards of ownership of the goods have been transferred to the buyer.
• The Company retains neither continuing managerial involvement to the degree usually associated with ownership nor
effective control over the goods sold.
• The amount of revenue can be measured reliably.
• It is probable that the economic benefits associated with the transaction will flow to the Company.
• The costs incurred or to be incurred in respect of the transaction can be measured reliably.
Revenue is recognised on satisfaction of performance obligation upon transfer of control of promised products to customers
in an amount that reflects the consideration the Company expects to receive in exchange for those products.
The transaction price is documented on the sales invoice and payment is generally due as per agreed credit terms with
customer.
The Company does not expect to have any contracts where the period between the transfer of the promised goods or
services to the customer and payment by the customer exceeds one year. As a consequence, it does not adjust any of the
transaction prices for the time value of money.
A receivable is recognised when the goods are delivered as this is the point of time that the consideration is unconditional
because only the passage of time is required before the payment is done.
Dividend income is recognised when right to receive dividend is established. Interest income is recognised on time
proportion basis. Insurance and other claims are recognised as revenue on certainty of receipt on prudent basis.
Export benefits available under prevalent schemes are accrued in the year in which the goods are exported and there is
no uncertainty in receiving the same. Export benefit receivables are carried at net realisable value.
k. Employee Benefits :
(i) Short term employee benefits
All employee benefits payable wholly within twelve months from reporting date are classified as short term employee
benefits. Benefits such as salaries, wages, short-term compensated absences, performance incentives and the
expected cost of bonus ex-gratia etc. are recognised during the period in which the employee renders related service.
(ii) Defined benefit plans
Gratuity plan
The Company provides for gratuity and a gratuity-cum-death benefit plan, defined benefit retirement plans covering
eligible employees.
The gratuity plan is an unfunded defined benefit scheme, under which the Company pays a lump-sum benefit to
eligible employees upon retirement, death, permanent disability, or termination of employment. The benefit is based
on the employee's last drawn salary and the number of years of service. The liability for gratuity is determined at each
reporting date through an actuarial valuation conducted by an independent actuary using the Projected Unit Credit
Method.
The gratuity-cum-death benefit plan is a funded defined benefit scheme administered through a group policy with
the Life Insurance Corporation of India (LIC). Contributions to the plan are made by the Company based on actuarial
valuations, and the assets of the plan are held by LIC.
The net defined benefit obligation recognized in the balance sheet represents the present value of the defined benefit
obligation, as determined by actuarial valuation, adjusted for the fair value of plan assets (in case of the funded
plan). Any resulting net asset is recognized only to the extent it is recoverable through future refunds or reductions in
contributions. Actuarial gains and losses are recognized in full in Other Comprehensive Income in the period in which
they arise. The impact of plan amendments, if any, is recognized in the Statement of Profit and Loss.
Compensated absences
Company has a policy on compensated absences which are both accumulating and non-accumulating in nature.
The expected cost of accumulating compensated absences is determined by actuarial valuation performed by an
independent actuary at each balance sheet date using projected unit credit method.
Liability in respect of Compensated absences which are not expected to occur within twelve months after the end
of the period in which the employee renders the related services are recognised at the present value of the defined
benefit obligation at the balance sheet date.
Expense on non-accumulating compensated absences is recognised in the period in which the absences occur.
(iii) Defined contribution plans
Contributions to defined contribution plans are recognised as expense when employees have rendered services
entitling them to such benefits. The Company pays provident fund contributions to publicly administered provident
funds as per local regulations. The Company has no further payment obligations once the contributions have been
paid. The contributions are accounted for as defined contribution plans and the contributions are recognised as
employee benefit expense when they are due. Prepaid contributions are recognised as an asset to the extent that a
cash refund or a reduction in the future payments is available.
l. Employees Stock Options Plans (“ESOPs”) :
Equity-settled share-based payments to employees are measured at the fair value of the equity instruments at the grant
date. The fair value determined at the grant date of the equity-settled share-based payments is expensed over the vesting
period, based on the Company's estimate of equity instruments that will eventually vest, with a corresponding increase in
equity. The increase in equity recognised in connection with share based payment transaction is presented as a separate
component in Equity under “Employee Stock Options Outstanding Reserve”. At the end of each reporting period, the
Company revises its estimate of the number of equity instruments expected to vest. The impact of the revision of the
original estimates, if any, is recognised in the statement of profit or loss such that the cumulative expense reflects the
revised estimate, with a corresponding adjustment to the Employee Stock Options Outstanding Reserve. The Company
recognises compensation expense relating to share-based payments in net profit using fair-value in accordance with Ind
AS 102, Share-Based Payment.
m. Trade and Other Payables
These amounts represent liabilities for goods and services provided to the Company prior to the end of financial year
which are unpaid. The amounts are unsecured and are usually paid as per the terms agreed. Trade and other payables are
presented as current liabilities unless payment is not due within 12 months after the reporting period. They are recognised
initially at their fair value and subsequently measured at amortised cost.
n. Borrowings
Borrowings are initially recognised at fair value, net of transaction costs incurred. Borrowings are subsequently measured
at amortised cost. Any difference between the proceeds (net of transaction costs) and the redemption amount is recognised
in profit or loss over the period of the borrowings using the effective interest method.
Borrowings are removed from the balance sheet when the obligation specified in the contract is discharged, cancelled or
expired. The difference between the carrying amount of a financial liability that has been extinguished or transferred to
another party and the consideration paid, including any non-cash assets transferred or liabilities assumed, is recognised in
profit or loss as other gains/(losses).
Borrowings are classified as current liabilities unless the Company has an unconditional right to defer settlement of the
liability for at least 12 months after the reporting period. Where there is a breach of a material provision of a long-term loan
arrangement on or before the end of the reporting period with the effect that the liability becomes payable on demand on
the reporting date, the entity does not classify the liability as current, if the lenders agree, after the reporting period and
before the approval of the financial statements for issue, not to demand payment as a consequence of the breach.
o. Borrowing Costs:
Borrowing costs directly attributable to the acquisition, construction or production of an asset that necessarily takes a
substantial period of time to get ready for its intended use or sale are capitalised as part of the cost of the asset. All other
borrowing costs are expensed in the period in which they occur. Borrowing costs consist of interest and other costs that
an entity incurs in connection with the borrowing of funds. Borrowing cost also includes exchange differences to the extent
regarded as an adjustment to the borrowing costs.
p. Lease :
The Company lease assets primarily consists of office premises which are generally cancellable and leasehold land. The
Company assesses whether a contract contains a lease at inception of a contract. A contract is, or contains, a lease if the
contract conveys the right to control the use of an identified asset for a period of time in exchange for consideration. To
assess whether a contract conveys the right to control the use of an identified asset, the Company assesses whether:
(i) the contract involves the use of an identified asset
(ii) the Company has substantially all of the economic benefits from use of the asset through the period of the lease and
(iii) the Company has the right to direct the use of the asset.
At the date of commencement of the lease, the Company recognises a right-of-use asset (“ROU”) and a corresponding
lease liability for all lease arrangements in which it is a lessee, except for leases with a term of twelve months or less (short
term leases) and leases of low value assets. For these short term and leases of low value assets, the Company recognises
the lease payments as an operating expense on a straight-line basis over the term of the lease.
The right-of-use assets other than leasehold land are initially recognised at cost, which comprises the initial amount of
the lease liability adjusted for any lease payments made at or prior to the commencement date of the lease plus any
initial direct costs less any lease incentives. They are subsequently measured at cost less accumulated depreciation and
impairment losses, if any. Leasehold land are stated at revalued amount. Right-of-use assets are depreciated from the
commencement date/Revaluation date on a straight-line basis over the shorter of the lease term and balance useful life of
the underlying asset. Right-of-use assets are evaluated for recoverability whenever events or changes in circumstances
indicate that their carrying amounts may not be recoverable.
The lease liability is initially measured at the present value of the future lease payments. The lease payments are discounted
using the interest rate implicit in the lease or, if not readily determinable, using the incremental borrowing rates. The lease
liability is subsequently remeasured by increasing the carrying amount to reflect interest on the lease liability, reducing the
carrying amount to reflect the lease payments made.
A lease liability is remeasured upon the occurrence of certain events such as a change in the lease term or a change in an
index or rate used to determine lease payments. The remeasurement normally also adjusts the leased assets.
Lease liability and ROU asset have been separately presented in the Balance Sheet and the lease payments have been
classified as financing cash flows.
q. Government Grant
Grants from the Government are recognised at their fair value where there is reasonable assurance that the grant will be
received and the Company will comply with all the attached condition.
Export benefits available under prevalent schemes are accrued in the year in which the goods are exported and there is
no uncertainty in receiving the same.
r. Earnings Per Share
Basic earnings per equity share is computed by dividing the net profit/(loss) attributable to the equity holders of the
company by the weighted average number of equity shares outstanding during the period[including instruments which
are mandatorily convertible into equity shares of the Company (if any)]. Diluted earnings per equity share is computed by
dividing the net profit/(loss) attributable to the equity holders of the Company by the weighted average number of equity
shares considered for deriving basic earnings per equity share and also the weighted average number of equity shares
that could have been issued upon conversion of all dilutive potential equity shares. The dilutive potential equity shares
are adjusted for the proceeds receivable had the equity shares been actually issued at fair value. Dilutive potential equity
shares are deemed converted as of the beginning of the period, unless issued at a later date. Dilutive potential equity
shares are determined independently for each period presented.
s. Income Taxes :
Income tax expense comprises current and deferred income tax.
Current Tax
Current tax comprises the expected tax payable or receivable on the taxable income or loss for the year and any adjustment
to the tax payable or receivable in respect of prior periods. It is measured using tax rates and tax laws that have been
enacted by the balance sheet date.
Current tax assets and liabilities are offset only if, the Company;
• Has a legally enforceable right to set off the recognised amounts; and
• Intends either to settle on a net basis, or to realise the asset and settle the liability simultaneously.
Deferred Tax
Deferred tax is recognised in respect of temporary differences between the carrying amounts of assets and liabilities for
financial reporting purposes and the amounts used for taxation purpose.
Deferred tax assets are recognised for unused tax losses, unused tax credits and deductible temporary differences to the
extent that it is probable that future taxable profits will be available against which they can be used. Deferred tax assets are
reviewed at each reporting date and are reduced to the extent that it is no longer probable that the related tax benefit will
be realized; such reductions are reversed when the probability of future taxable profits improves.
Deferred tax assets are reassessed at each reporting date and recognised to the extent that it has become probable that
future taxable profits will be available against which they can be used.
Deferred tax is measured at the tax rates that are expected to be applied to temporary differences when they reverse, using
tax rates enacted or substantively enacted at the reporting date.
The measurement of deferred tax reflects the tax consequences that would follow from the manner in which the Company
expects, at the reporting date, to recover or settle the carrying amount of its assets and liabilities.
The Company offsets current tax assets and current tax liabilities, where it has a legally enforceable right to set off the
recognised amounts and where it intends either to settle on a net basis, or to realise the asset and settle the liability
simultaneously.
Minimum Alternate Tax ('MAT') credit is recognised as deferred tax asset only when and to the extent there is convincing
evidence that the Company will pay normal income tax during the period for which the MAT credit can be carried forward
for set-off against the normal tax liability. MAT credit recognised as an asset is reviewed at each Balance Sheet date and
written down to the extent the aforesaid convincing evidence no longer exists.
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