3.19 Provisions and contingent liabilities
A provision is recognized when the Company has a present obligation (legal or constructive) as a
result of past event and it is probable that an outflow of resources embodying economic benefits
will be required to settle the obligation, in respect of which a reliable estimate can be made.
A disclosure for a contingent liability is made when there is a possible obligation or a present
obligation that may, but probably will not require an outflow of resources.
18.1 Vehicle Loans from Bank are secured by hypothecation of Trucks and Motor Cars for which
loan has been taken.
18.2 The Commercial Vehicle Loan taken from HDFC Bank and GECL on the same is secured
against hypothecation of Trucks purchased against the same.
18.3 Loan against residential Property taken from ICICI Bank and Top Up Loan on the same is
secured by mortgage of Residential Flat purchased by the company at Surat. Loan against
office building taken from ICICI Bank is secured by mortgage of Office Building purchased
by the company.
18.4 Term Loans from Banks includes ECLGS is secured by hypothecation of Assets created out
of Bank Finance. The rate of interest of TL is 8.75% as at the year end.
b) Details of investments made are given in Note No. 6.
45. DISCLOSURE UNDER RULE 11(E) OF COMPANIES (AUDIT AND AUDITORS) RULES, 2014
No funds have been advanced or loaned or invested (either from borrowed funds or share premium or any other sources or kind of funds) by the Company to or in any other person(s) or entity(ies),
including foreign entities (“Intermediaries”) with the understanding, whether recorded in writing or otherwise, that the Intermediary shall lend or invest in party identified by or on behalf of the Company
(Ultimate Beneficiaries). The Company has not received any fund from any party(s) (Funding Party) with the understanding that the Company shall whether, directly or indirectly lend or invest in other
persons or entities identified by or on behalf of the Company (“Ultimate Beneficiaries”) or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.
46. FINANCIAL INSTRUMENTS - FAIR VALUES AND RISK MANAGEMENT
A. Accounting classifications 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 not measured at fair value if the carrying amount is a reasonable approximation of fair value.
Equity Security includes only shares of Co-operative bank. The equity instruments of Co-operative
Bank is not listed on stock exchange and are not tradable security. Further, share have been
purchased due to banking relation with said bank and as per Co-operative bank policy only face
value of shares is paid back at time of closure of relationship. Hence, equity security with Co¬
operative bank is taken at face value only as no amount above it can be realized by the company.
B. Financial risk management:
The Group has exposure to the following risks arising from financial instruments:
(i) credit risk
(ii) liquidity risk
Risk management framework
The Company's board of directors has overall responsibility for the establishment and oversight of
the risk management framework.
The board of directors has established the risk management committee, which is responsible for
developing and monitoring the Company's risk management policies. The committee reports
regularly to the board of directors on its activities.
The Company's risk management policies are established to identify and analyse the risks faced
by the Company, to set appropriate risk limits and controls and to monitor risks and adherence
to limits. Risk management policies and systems are reviewed regularly to reflect changes in
market conditions and the Group's activities. The Company, through its management standards
and procedures, aims to maintain a disciplined and constructive control environment in which all
employees understand their roles and obligations.
The financial risk disclosures presented are only illustrative and reflect the facts and circumstances
of the Group. In particular, Ind AS 107 requires the disclosure of summary quantitative data about
an entity's risk exposures based on information provided internally to an entity's key management
personnel, although certain minimum disclosures are also required to the extent that they are not
otherwise covered by the disclosures made under the 'management approach' above.
Credit risk
Credit risk is the risk of financial loss to the Company if a customer or counterparty to a financial
instrument fails to meet its contractual obligations, and arises principally from the Company's
receivables from customers, loans and investments in debt securities.
The carrying amounts of financial assets and contract assets represent the maximum credit
exposure.
Impairment losses on financial assets and contract assets recognised in profit or loss were NIL.
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 Company's objective when managing liquidity is to ensure, as far as possible, that it will
have sufficient liquidity to meet its liabilities when they are due, under both normal and stressed
conditions, without incurring unacceptable losses or risking damage to the Company's reputation.
47. Additional Information as required by para 7 of General Instructions for preparation of
Statement of Profit and Loss (other than already disclosed above) are either Nil or Not
Applicable.
48. Previous Year Figures have been regrouped/rearranged wherever necessary.
As per our Audit Report Attached For & On Behalf of Board of Directors
For RKM & Co. Naresh Saboo Narayan Saboo
Chartered Accountants Managing Director Director
Firm Registration No.: 108553W DIN: 00223350 DIN: 00223324
Manish R. Malpani Mohit Saboo
Partner Director & CFO
Membership No.: 121031 DIN: 02357431
Place: Surat
Date: May 30, 2025
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