(l) Provisions, contingent liabilities and contingent assets
Provisions involving substantial degree of estimation in measurement are recognized when there is a present obligation as a result of past events
and it is probable that there will be an outflow of resources for which reliable estimate can be made. The expenses related to provision is
presented In P&L net of anv reimbursement.
Liabilities which are of a contingent nature are not provided but are disclosed at their estimated amount in the notes forming part of the financial
statements. Contingent assets are neither recognized nor disclosed in the financial statements.
Where the company expects some or all of a provision to be reimbursed, for example under an insurance contract, the reimbursement is
recognited as a separate asset but only when the reimbursement is virtually certain. The expense relating to any provision is presented in the
statement of profit and loss net of any reimbursement.
(m) Borrowing Costs
Borrowing costs directly attributable to the acquisition, construction or production of qualifying assets, which are assets that necessarily take a
substantial period of time to get ready for their intended use or sale, are added to the cost of these assets, until such time as the assets are
substantially ready for their intended use or sale.
All other borrowing costs are recognised in statement of profit and loss in the period in which they are incurred.
(n) Cash flow statement
Cash flows are reported using the indirect method, whereby profit before tax is adjusted for the effects of transactions of a non-cash 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
cashflows. The cash flows from operating, investing and financing activities of the Company are segregated.
(o) Operating Cycle and Current/Non-current classification
Based on the nature of products and the time between acquisition of assets for processing and their realisation in cash and cash equivalents, the
Company has ascertained its operating cycle as twelve months for the purpose of current/non-current classification of assets and liabilities.
The Company presents assets and liabilities in the balance sheet based on current/ non-current classification. An asset is current when it is:
- Expected to be realised or intended to be sold or consumed in normal operating cycle.
- Held primarily for the purpose of trading.
- Expected to be realised within twelve months after the reporting period, or
- Cash or cash equivalent.
All other assets are classified as non-current.
A liability is current when:
- it is expected to be settled in normal operating cycle.
- It is held primarily for the purpose of trading.
- it is due to be settled within twelve months after the reporting period, or
- There is no unconditional right to defer the settlement of the liability for at least twelve months after the reporting period.
The Company classifies all other liabilities as non-current.
Deferred tax assets and liabilities are classified as non-current assets and liabilities.
The Company has only one class of equity shares having a par value of Rs. 5 per share. Each equity shareholder is entitled to one vote per share. In
the event of liquidation of the company, the holders of equity shares will be entitled to receive remaining Assets of the company, after
distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders
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