14. Provision & contingent liabilities

Provisions are recognised when the Company has a present legal or constructive obligation as a result of
past events, it is probable that an outflow of resources will be required to settle the obligation and the
amount can be reliably estimated.

Contingent Liabilities are disclosed in respect of possible obligations that arise from past events but their
existence will be confirmed by the occurrence or non-occurrence of one or more uncertain future events
not wholly within the control of the Company or where any present obligation cannot be measured in
terms of future outflow of resources or where a reliable estimate of the obligation cannot be made.

15. Revenue recognition

Revenue form contracts with customers is recognised when control of the goods is transferred to the
customer which usually is on delivery of goods to the transporter at an amount that reflects the

consideration to which the Company expects to be entitle in exchange for those goods. Revenue are
measured at the fair value of the consideration receive or receivable and net of indirect taxes.

The Company does not expect to have any contracts where the period between the transfer of promise
goods to the customer and payment by the customer exceeds one year. As a consequence, the Company
does not adjust any of the transaction prices for the time value of money.

A contract asset is the right to consideration in exchange for goods transferred to the customer. If the
company perform by transferring the goods to a customer before the customer pays consideration or
before payment is due, a contract asset is recognise for the earned consideration that is conditional. The
Company does not have any contract assets as performance under right to consideration occurs with-in a
short period of time and all rights to consideration are unconditional.

A contact liability is the obligation to transfer goods to a customer for which the Company has received
consideration from the customer. If a customer pays consideration before the Company transfers goods to
the customer, a contract liability is recognised when the payment is made. Contract liabilities are
recognised as revenue when the company performs under the contract.

16. Employee benefits
Short term employee benefits

The undiscounted amount of short term employee benefits expected to be paid in exchange for the
services rendered by employees are recognised as an expense during the period when the employees
render the services.

Post -employment Benefits

The Company operates the following post-employment schemes:

a. defined benefit plans such as gratuity; and

b. defined contribution plans such as provident fund.

Defined Benefit Plans

The liability or asset recognised in the balance sheet in respect of defined benefit gratuity plans is the
present value of the defined benefit obligation at the end of the reporting period less the fair value of plan
assets. The defined benefit obligation is calculated annually by actuaries using the projected unit credit
method.

The present value of the defined benefit obligation is determined by discounting the estimated future cash
outflows by reference to market yields at the end of the reporting period on government bonds that have
terms approximating to the terms of the related obligation.

The net interest cost is calculated by applying the discount rate to the net balance of the defined benefit
obligation and the fair value of plan assets. This cost is included in employee benefit expense in the
Statement of Profit and Loss.

Re-measurement gains and losses arising from experience adjustments and changes in actuarial
assumptions are recognised in the period in which they occur, directly in other comprehensive income.
They are included in retained earnings in the statement of changes in equity and in the balance sheet.

Defined Contribution plans

Under defined contribution plans, provident fund, the Company pays pre-defined amounts to separate
funds and does not have any legal or informal obligation to pay additional sums. Defined Contribution
plan comprise of contributions to the employees’ provident fund with the government and certain state
plans like Employees’ State Insurance and Employees’ Pension Scheme. The Company’s payments to the
defined contribution plans are charged to Statement of Profit and Loss as incurred.

Other employee benefits

The liabilities for earned leave is determined on the basis of accumulated leave to the credit of the
employees as at the year-end charged to the statement of profit and loss as per the Company’s rules being
the short term benefits.

17. Foreign Currency translation

(i) Functional and presentation currency

The financial statements are presented in Indian rupee (INR), which is Company’s functional and
presentation currency.

(ii) Transactions and balances

Transactions in foreign currencies are recorded at the exchange rate prevailing on the date of transaction.
Monetary assets and liabilities denominated in foreign currencies are translated at the functional currency
closing rates of exchange at the reporting date.

Exchange differences arising on settlement or translation of monetary items are recognised in Statement of
Profit and Loss except to the extent of exchange differences which are regarded as an adjustment to
interest costs on foreign currency borrowings that are directly attributable to the acquisition or
construction of qualifying assets, are capitalized as cost of assets.

18. Tax Expenses

The tax expense for the period comprises current and deferred tax. Tax is recognised in Statement of
Profit and Loss, except to the extent that it relates to items recognised in the comprehensive income or in
equity. In which case, the tax is also recognised in other comprehensive income or equity.

Current tax

Current tax assets and liabilities are measured at the amount expected to be recovered from or paid to the
taxation authorities, based on tax rates and laws that are enacted or substantively enacted at the Balance
Sheet date.

Deferred tax

Deferred tax is recognised on temporary differences between the carrying amounts of assets and liabilities
in the financial statements and the corresponding tax bases used in the computation of taxable profit.

Deferred tax liabilities and assets are measured at the tax rates that are expected to apply in the period in
which the liability is settled or the asset realised, based on tax rates (and tax laws) that have been enacted

or substantively enacted by the end of the reporting period. The carrying amount of Deferred tax liabilities
and assets are reviewed at the end of each reporting period

19. Earning per share
Basic earnings per share

Basic earnings per share is calculated by dividing:

- the profit attributable to owners of the Company

- by the weighted average number of equity shares outstanding during the financial year,

Diluted earnings per share

Diluted earnings per share adjusts the figures used in the determination of basic earnings per share to take
into account:

- the after income tax effect of interest and other financing costs associated with dilutive potential
equity shares, and

- the weighted average number of additional equity shares that would have been outstanding
assuming the conversion of all dilutive potential equity shares

20. Cash Flow Statement

Cash flows are reported using the indirect method whereby the profit before tax is adjusted for the effect
of the transactions of a non-cash nature, any deferrals or accruals of past and future operating cash receipts
or payments and items 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.

21. Segment Reporting

Operating segments are reported in manner consistent with the internal reporting provided to the chief
operating decision maker. The management assesses the financial performance and position of the
Company and makes strategic decisions. The chief operating decision maker consists of the Directors of
the Company.