vii Provisions and Contingencies
J___
A provision arising from claims, litigation, assessment, fines, penalties, etc. is recognised when the Company has
a present obligation (legal or constructive) as a result of a past event and it is probable that an outflow of
resources embodying economic benefits will be required to settle the obligation and a reliable estimate can be
made of the amount of the obligation. These are reviewed at each balance sheet date and adjusted to reflect
current management estimates. Contingent liabilities are disclosed in respect of possible obligations that have
arisen from past events and the existence of which will be confirmed only by the occurrence or non-occurrence of
one or more uncertain future events not wholly within the control of the enterprise. When there is a possible
obligation or present obligation where the likelihood of an outflow is remote, no disclosure or provision is made.
A contingent asset is a possible asset that arises from past events and whose existence will be confirmed only by
the occurrence or non-occurrence of one or more uncertain future events not wholly within the control of the
entity. A contingent asset is disclosed, where an inflow of economic benefits is probable.
When some or all of the economic benefits required to settle a provision are expected to be recovered from a
third party, the receivable is recognized as an asset, if it is virtually certain that reimbursement will be received
and the amount of the receivable can be measured reliably.
If the effect of the time value of money is material, provisions are discounted using a current pre-tax rate that
reflects, when appropriate, the risks specific to the liability. When discounting is used, the increase in the
provision due to the passage of time is recognised as a finance cost.
The company does not recognize a contingent liability but disclosed its existence in the financial statements.
viii Income Taxes
Income tax comprises current tax and deferred tax. Income tax expense is recognized in the statement of profit
and loss except to the extent it relates to items directly recognized in equity or in other comprehensive income.
Current tax
Current tax for the current and prior periods are measured at the amount expected to be recovered from or paid
to the taxation authorities based on the taxable income for the period. The tax rates and tax laws used to compute
the current tax amount are those that are enacted or substantively enacted by the reporting date and applicable
for the period. The Company offsets current tax assets and current tax liabilities, where it has a legally
enforceable right to set off the recognized amounts and where it intends either to settle on a net basis or to realize
the asset and liability simultaneously.
Deferred tax
Deferred tax is recognized using the balance sheet approach. Deferred tax assets and liabilities are recognized
for deductible and taxable temporary differences arising between the tax base of assets and liabilities and their
carrying amount in financial statements, except when the deferred tax arises from the initial recognition of
goodwill or an asset or liability in a transaction that is not a business combination and affects neither accounting
nor taxable profits or loss at the time of the transaction.
Deferred tax assets are recognized to the extent that it is probable that taxable profit will be available against
which the deductible temporary differences, and the carry forward of unused tax credits and unused tax losses
can be utilized.
Deferred tax liabilities are recognized for all taxable temporary differences.
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.
Deferred tax assets and liabilities are measured at the tax rates that are expected to apply in the period 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.
Minimum Alternate Taxes
Minimum Alternate Tax (MAT) is payable when the taxable profit is lower than the book profit. Taxes paid under
MAT are available as a set off against regular income tax payable in subsequent years. MAT paid in a year is
charged to the Statement of Profit and Loss as current tax. The Company recognises MAT credit available as an
asset only to the extent that there is convincing evidence that the Company will pay normal income tax during the
specified period i.e the period for which MAT credit is allowed to be carried forward. MAT credit is recognised as
an asset and is shown as 'MAT Credit Entitlement'. The Company reviews the 'MAT Credit Entitlement' asset at
each reporting date and write down the asset to the extent the Company does not have convincing evidence that
it will pay normal tax during the specified period.
ix) Foreign Currency Translations
a Functional and Presentation Currency
Items included in the financial statements are measured using the currency of the primary economic environment
in which the entity operates ('the functional currency'). The financial statements are presented in Indian Rupee
(INR), which is BOJ Heights Private Limited's functional and presentation currency.
b Transactions and balances
Foreign currency transactions are translated into the functional currency using the exchange rates at the dates of
the transactions. Foreign exchange gains and losses resulting from the settlement of such transactions and from
the translation of monetary assets and liabilities denominated in foreign currencies at year end exchange rates
are recognised in profit or loss.
x) Leases
As a Lessee:
Leases of property, plant and equipment where the company, as lessee, has substantially all the risks and
rewards of ownership are classified as finance leases. Finance leases are capitalised at the lease's inception at
the fair value of the leased property or, if lower, the present value of the minimum lease payments. The
corresponding rental obligations, net of finance charges, are included in borrowings or other financial liabilities as
appropriate. Each lease payment is allocated between the liability and finance cost. The finance cost is charged
to the profit or loss over the lease period so as to produce a constant periodic rate of interest on the remaining
balance of the liability for each period.
Leases in which a significant portion of the risks and rewards of ownership are not transferred to the company as
lessee are classified as operating leases. Payments made under operating leases (net of any incentives received
from the lessor) are charged to profit or loss on a straight-line basis over the period of the lease unless the
payments are structured to increase in line with expected general inflation to compensate for the lessor's
expected inflationary cost increases.
The determination of whether an arrangement is (or contains) a lease is based on the substance of the
arrangement at the inception of the lease. The arrangement is, or contains, a lease if fulfilment of the
arrangement is dependent on the use of a specific asset or assets and the arrangement conveys a right to use
the asset or assets, even if that right is not explicitly specified in an arrangement. Arrangements containing a
lease have been evaluated as on the date of transition i.e. April 1, 2016 in accordance with Ind-AS 101 First-time
Adoption of Indian Accounting Standards.
As a Lessor:
Leases in which the company does not transfer substantially all the risk and benefits of ownership of the assets
are classified as operating leases. Assets subject to operating lease are included in Property, Plant & Equipment.
Lease income on an operating lease is recognized in the statement of profit and loss on a straight-line basis over
the lease term. Costs, including depreciation are recognized immediately in the statement of profit & loss. Initial
direct costs such as legal costs, brokerage costs, etc. are recognized immediately in the statement of profit and
loss.
xi) Cash and Cash Equivalents
For the purpose of presentation in the statement of cash flows, cash and cash equivalents includes cash on hand,
deposits held at call with financial institutions, 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, and bank overdrafts.
xii Revenue Recoginition
J___
Revenue is recognized to the extent that it is probable that the economic benefits will flow to the
Company and the revenue can be reliably measured.
Income from Services - Revenue is recognized on an accrual basis in accordance with the terms of the relevant
agreement.
Interest Income: Interest income is recognized as it accrues in Statement of Profit and Loss using the effective
interest method.
Dividend income - Revenue is recognized when the shareholder's right to receive payment is established at the
balance sheet date. Dividend income is included under the head “Other income” in the statement of profit and
loss.
xiii Earnings Per Share
Basic earnings per share is computed using the weighted average number of equity shares outstanding during
the period.
Diluted earning per share is computed by dividing the net profit after tax by the weighted average number of
equity shares considered for deriving basic EPS and also weighted average number of equity shares that could
have been issued upon conversion of all dilutive potential equity shares. 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. The number of equity shares and potentially dilutive
equity shares are adjusted for bonus shares, as appropriate.
xiv Segment reporting
Business segment: The Company has a single reportable business segment namely; carrying out business of
trading of goods (Chemical items)
xxi Rounding of amounts
All amounts disclosed in the financial statements and notes have been rounded as per the requirement of Part I of
Schedule III, unless otherwise stated.
31 Financial Risk Management
The Company’s financial risk management is an integral part of how to plan and execute its business
strategies. The Company’s financial risk management policy is set by the Managing Board. The financial
risks are identified, measured and managed in accordance with the Company’s policies on risk
management. Key financial risks and mitigation plans are reviewed by the board of directors of the
Company.
a. Market risk | | | |
Market risk is the risk of loss of future earnings, fair value of future cash flows that may result from a
change in the price of financial instrument. The value of a financial instrument may change as a result of
changes in the interest rates, equity prices and other market changes that may effect market sensitivity
instruments. Market risk is attributable to all market risk sensitive financial instruments including
investments and deposits, loans and borrowings.
__Interest Rate Risk______
Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate
because of changes in market interest rates. In order to balance the Company’s position with regards to
interest income and interest expense and to manage the interest rate risk, management performs a
comprehensive interest rate risk management. The Company has no interest bearing borrowings hence it is
not exposed to significant interest rate risk as at the respective reporting dates. The Company's fixed rate
financial assets are carried at amortized cost. They are therefore not subject to interest rate risk, since
neither the carrying amount nor the future cash flows will fluctuate because of change in market interest
rates.
Foreign currency risk
__The Company has operations in India only hence Company’s exposure to foreign currency risk is nil._
Price Risk
Price risk arises from exposure to equity securities prices from investments held by the Company. The
__Company does not have any investments in equity shares.___
b. "credit RISK II II
Credit risk is the risk that customer or counter-party will not meet its obligation under the contract, leading
__to financial loss. Credit risk arises from trade receivables and other financial assets. _
__Trade Receivables______
Customer credit risk is managed on the basis of established policies of the Company, procedures and
controls relating to customer credit risk management which helps in assessing the risk at the initial
recognition of the asset. Outstanding customer receivables are regularly and closely monitored. Based on
prior experience and an assessment of the current receivables, the management believes that there is no
__credit risk and accordingly no provision is required. ___
__Other Financial Assets______
There is no credit risk exposure with respect to other financial assets as they are either supported by legal
__agreement or are with Nationalized banks._
- Deposits are held with Banks are with Nationalized Bank, hence the risk of default is considered to be
__negligible._
- Other receivables from related parties are as per approved policy and the established procedure to monitor
__the dues from related parties which also ensures timely payments and no default, hence there is no credit
A1VAS P OL IMERu L1M1 T ED (FUimtliy , Jdi MUU AUIU Liilk5 Ltd) | 3 9 ANNUAL REP V
__risk exposure involved. _____
Provision for Expected Credit
__losses_____
__Financial Assets are considered to be of good quality and there is no credit risk to the Company,_
C. LIQUIDITY RISK | | | |
_ Liquidity risk is the risk that the Company will encounter difficulty in meeting the obligations associated
with its financial liabilities that are settled by delivering cash or another financial asset. The Group's
approach to managing liquidity is to ensure as far as possible, that it will have sufficient liquidity to meet
__its liabilities when they are due._
_ Management monitors rolling forecasts of the liquidity position and cash and cash equivalents on the basis
of expected cash flows. The Company takes into account the liquidity of the market in which the entity
operates.
The Company aim to manages its capital efficiently so as to safeguard its ability to continue as a going
concern and to optimize returns to shareholders. The capital structure of the Company is based on
management’s judgment of the appropriate balance of key elements in order to meet its strategic and day-
to-day needs. We consider the amount of capital in proportion to risk and manage the capital structure in
light of changes in economic conditions and the risk characteristics of the underlying assets. The
Company’s policy is to maintain a stable and strong capital structure with a focus on total equity so as to
maintain creditors and market confidence and to sustain future development and growth of its business.
There in no change in the Company capital structure since previous year. __
No.
33 The Company has not received intimation from vendors regarding their status under the Micro, Small and Medium
Enterprises Development Act, 2006 and hence names of Micro, Small and Medium Enterprises to whom the
company owes any sum together with interest unpaid as on the date of balance sheet is no ascertainable.
34 The Balances of Trade receivables, Trade Payables, Loans and Advances appearing in the balance sheet are
subject to balance confirmation/reconciliation at the year end. The management is in the process of obtaining the
respective confirmations in the due course. However, the reconciliation of these balances is not expected to result in
any material adjustments in the stated balances in the financial Statements.
35 The figures of previous years have been recast/regrouped wherever necessary to make them comparable and for
the purpose of our audit.
|