(D) There are no provisions for doubtful debts or amounts written off or written back in respect of debts due to or due from
related parties
(E) Related party relationship is as identified by the Company on the basis of information available with them and relied
upon by the Auditors
Accounting classification and fair values
The following table shows the carrying amounts and fair values of financial assets and financial liabilities, including their levels in • '
the fair value hierarchy. It does not include fair value information for financial assets and financial liabilities if the carrying
amount is a reasonable approximation of fair value.
(B) FAIR VALUE HEIRARCHY
Fair value is the amount for which an asset could be exchanged, or a liability settled between knowledgeable willing parties in
an arm's length transaction. The Company has made certain judgements and estimates in determining the fair values of the
financial instruments that are (a) recognised and measured at fair value and (b) measured at amortised cost and for which fair
values are disclosed in the financial statements.
To provide an indication about the reliability of the inputs used in determining fair value, the Company as classified the financial
instruments into three levels prescribed under the accounting standard. An explanation of each level is as follows:
Level 1: Level 1 of hierarchy includes financial assets that are measured by reference to quoted prices (unadjusted) in active
& * markets for identical assets or liabilities.
Level 2: Level 2 heirarchy includes financial instruments that are not traded in an active market is determined using valuation
techniques which maximise the use of observable market data and rely as little as possible on entity-specific estimates.
Level 3: If one or more of the significant inputs is not based on the observable market data, the instrument is included in Level 3
heirarchy.
(C) VALUATION TECHNIQUES
Specific valuation techniques used to value financial instruments include
- the use of quoted market prices for mutual funds
- the fair value of the remaining financial instruments is determined using discounted cash flow analysis or such other
acceptable valuation methodology, wherever applicable
There are no items in the financial instruments, which required level 3 valuation.
Note: 35 Capital Management
The Company policy is to have robust financial base so as to maintain outsider's confidence and to sustain future development
of the business. Management monitors the return on capital, as well as level of dividends to equity shareholders.The company
monitors capital using a ratio of "adjusted net debt" to "equity". For this purpose, adjusted net debt is defined as total liability,
Comprising interest-bearing loans and borrowing, less cash and cash equivalents. Total Equity includes the share capital, other
equity.
Note: 36 Financial Risk Management
The Company's business activities are exposed to a variety of financial risks, viz liquidity risk, market risk and credit risk. The Management
of the Company has the overall responsibility for establishing and governing the Company's risk policy framework. The risk management
policies are formulated after the identification and analysis of the risks and suitable risk limits and controls are set which are monitored &
reveiwed periodically. The changes in the market conditions and allied areas are accordingly reflected in the changes of the policy. The
key risks and mitigating actions are placed before the Audit Committee of the Company who then evaluate and take the necessary
corrective action. The sources of risk, which the Company is exposed to and how the Company manages these risks with their impact on
the Financial Statements is given below:
[A] Credit risk
Credit risk is the risk of financial loss to the Company if the counterparty fails to meet its contractual obligations. The Company is exposed
to credit risk from its operating activities (primarily trade receivables). However, the credit risk on account of financing activities, i.e.,
balances with banks is very low, since the Company holds all the balances with approved bankers only.
Trade receivables
Credit risk is managed through credit approvals, establishing credit limits and continuously monitoring the customers outstanding
balances to which the Company grants credit terms in the normal course of business. Concentration of credit risk with respect to trade
receivables are limited, as the Company's customer base is large, reputed and having good credit credential as well as that they are long
standing customers. All trade receivables are reviewed and assessed for default on a quarterly basis. Historical experience of collecting
receivables of the Company is supported by low level of past default and hence the credit risk is perceived to be low.
[B] Liquidity risk
Liquidity risk is the risk the Company faces in meeting its obligations associated with its financial liabilities. The Company's approach in
managing liquidity is to ensure that it will have sufficient funds to meet its liabilities when due without incurring unacceptable losses. In
doing this, Management considers both normal and stressed conditions.
Maturities of financial liabilities
The below table analyses the Company's financial liabilities into relevant maturity groupings based on their contractual maturities. The
amounts disclosed in the table are contractual undiscounted cash flows, balances due within 12 months equal their carrying balances as
the impact of discounting is not significant.
[C] Market risk
The Company's size and operations result in it being exposed to the following market risks that arise from its use of financial instruments:
• Currency risk; and
• Interest rate risk
The above risks may affect the Company's income and expenses, or the value of its financial instruments.
Interest rate risk
Interest rate risk can be either fair value interest rate risk or cash flow interest rate risk. Fair value interest rate risk is the risk of changes in
fair values of fixed interest bearing financial assets or borrowings because of fluctuations in the interest rates, if such assets /borrowings
are measured at fair value through profit or loss. Cash flow interest rate risk is the risk that the future cash flows of floating interest
bearing borrowings will flucutate because of fluctuations in the interest rates.
Note: 37 Segment Information :
(a) Primary segment
The Company operates under a single reporting segment and hence, segment reporting is not applicable to the Company as per
AS 17 - Segment Reporting.
Note: 38
1. Figures of previous reporting periods have been regrouped/reclassified wherever necessary to correspond with the figures of
the current reporting period.
2. The outstanding balance as on year end in respect of trade receivables, trade payables, loans and advances and other
payables, and other receivables, if any, are subject to confirmation from respective parties and consequential reconciliation
and/or adjustments arising there from, if any. Management of the Company, however, does not expect any material variation.
3. According to the opinion of the management of the Company, the value of realization of trade and other receivables and
loans and advances given in the ordinary course of the business, if any, would not be less than the amount at which they are
stated in the balance sheet.
As per our Report of even date For and on behalf of the Board of Directors,
For H B Kalaria & Associates
Chartered Accountants
FRN : 104571W Harikrishna Chauhan Ilaben Paghdar
Whole Time Director Director
DIN:07710106 DIN:07591339
Hasmukh B Kalaria Dheeraj Sahu Poonam Kapupara
Partner CS CFO
Membership No.: 042002 PAN:EBCPS1128E PAN: LERPK8014D
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