1.11 Provisions, contingent liabilities and contingent assets:

Provisions are recognised only when:

i. an Company entity has a present obligation (legal or constructive) as a result of
a past event; and

ii. it is probable that an outflow of resources embodying economic benefits will be
required to settle the obligation; and

iii. a reliable estimate can be made of the amount of the obligation

Provision is measured using the cash flows estimated to settle the present obligation and
when the effect of time value of money is material, the carrying amount of the provision
is the present value of those cash flows. Reimbursement expected in respect of
expenditure required to settle a provision is recognised only when it is virtually certain that
the reimbursement will be received.

Contingent liability is disclosed in case of:

i. a present obligation arising from past events, when it is not probable that an outflow
of resources will be required to settle the obligation; and

ii. a present obligation arising from past events, when no reliable estimate is possible.
Contingent assets are disclosed where an inflow of economic benefits is probable.
Provisions, contingent liabilities and contingent assets are reviewed at each Balance Sheet
date.

Where the unavoidable costs of meeting the obligations under the contract exceed the
economic benefits expected to be received under such contract, the present obligation
under the contract is recognised and measured as a provision.

1.12 Statement of cash flows:

Statement of cash flows is prepared segregating the cash flows into operating, investing
and financing activities. Cash flow from operating activities is reported using indirect
method adjusting the net profit for the effects of:

i. changes during the period in operating receivables and payables transactions of

a non-cash nature;

ii. non-cash items such as depreciation, provisions, deferred taxes, un-realised gains
and losses; and

iii. all other items for which the cash effects are investing or financing cash flows.
Cash and cash equivalents (including bank balances) shown in the Statement of Cash
Flows exclude items which are not available for general use as on the date of Balance
Sheet.

1.13 Earnings per share:

The Company presents basic and diluted earnings per share data for its ordinary shares.
Basic earnings per share is calculated by dividing the profit or loss attributable to ordinary
shareholders of the Company by the weighted average number of ordinary shares
outstanding during the year. Diluted earnings per share is determined by adjusting the
profit or loss attributable to ordinary shareholders and the weighted average number of
ordinary shares outstanding, adjusted for own shares held, for the effects of all dilutive
potential ordinary shares.

1.145 Key source of estimation:

The preparation of financial statements in conformity with Ind AS requires that the
management of the Company makes estimates and assumptions that affect the reported
amounts of income and expenses of the period, the reported balances of assets and
liabilities and the disclosures relating to contingent liabilities as of the date of the financial
statements. The estimates and underlying assumptions are reviewed on an ongoing basis.
Revisions to accounting estimates include useful lives of property, plant and equipment &
intangible assets, expected credit loss on loan books, future obligations in respect of
retirement benefit plans, fair value measurement etc. Difference, if any, between the actual
results and estimates is recognised in the period in which the results are known.

1.16 Changes in Accounting Standard and recent accounting pronouncements
(New Accounting Standards issued but not effective):

On March 30, 2022, the Ministry of Corporate Affairs issued the Companies (Indian
Accounting Standards) (Amendments) Rules, 2019, notifying Ind AS 116 on Leases. Ind
AS 116 would replace the existing leases standard Ind AS 17. The standard sets out the
principles for the recognition, measurement, presentation and disclosures for both parties
to a contract, i.e. the lessee and the lessor. Ind AS 116 introduces a single lease accounting
model and requires a lessee to recognise assets and liabilities for all leases with a term of
more than 12 months, unless the underlying asset is of low value. Currently for operating
lease, rentals are charged to the statement of profit and loss. The Company is currently
evaluating the implication of Ind AS 116 on the financial statements.

The Companies (Indian Accounting Standards) Amendment Rules, 2019 notified
amendments to the following accounting standards. The amendments would be effective
from April 1, 2019

a) Ind AS 12, Income taxes — Appendix C on uncertainty over income tax treatments

b) Ind AS 19— Employee benefits

c) Ind AS 23 — Borrowing costs

d) Ind AS 28— investment in associates and joint ventures

e) Ind AS 103 and Ind AS 111 — Business combinations and joint arrangements

f) Ind AS 109 — Financial instruments

The Company is in the process of evaluating the impact of such amendments.

1.17 Inventories

Inventories have been valued at the method prescribed in the Accounting Standards.

1.18 Other Income Recognition

Interest on Loan is booked on a time proportion basis taking into account the amounts
invested and the rate of interest.

Dividend income on investments is accounted for when the right to receive the payment
is established.

1.19 Purchases

Purchase is recognized on passing of ownership in share based on broker’s purchase note.

1.20 Expenditure

Expenses are accounted for on accrual basis and provision is made for all known losses
and liabilities.

1.21 Related Parties

Parties are considered to be related if at any time during the reporting period one party
has the ability to control the other party or exercise significant influence over the other
party in making financial and/or operating decisions.

As required by AS-18 “Related Party Disclosure” only following related party relationships
are covered:

i. Enterprises that directly, or indirectly through one or more intermediaries,
control, or are controlled by, or are under common control with, the reporting enterprise
(this includes holding Companies, subsidiaries and fellow subsidiaries);

ii. Associates and joint ventures of the reporting enterprise and the investing party
or venture in respect of which the reporting enterprise is an associate or a joint venture;

iii. Individuals owning, directly or indirectly, an interest in the voting power of the
reporting enterprise that gives them control or significant influence over the enterprise,
and relatives of any such individual;

iv. Key management personnel (KMP) and relatives of such personnel; and

v. Enterprises over which any person described in (iii) or (iv) is able to exercise
significant influence.

1.23 Stock In Trade
Shares are valued at cost.

1.24 Fair Value Hierarchy

Level 1 - Quoted prices (unadjusted) in active markets for identical assets or liabilities.
Level 2 - Inputs other than quoted prices included within Level 1 that are observable for
the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices).

Level 3 - Inputs for the assets or liabilities that are not based on observable market data
(unobservable inputs).

1.25 Financial Risk Management Objectives and Policies:

The Company’s activities are exposed to a variety of Financial Risks from its Operations.
The key financial risks include Market risk, Credit risk and Liquidity risk.

i. Market Risk:

Market risk is the risk that the fair value of future cash flows of a financial instrument will
fluctuate because of changes in market prices. Market risk comprises mainly three types

of risk, foreign currency risk, Interest rate risk and other price risk such as Equity price
risk and Commodity Price risk.

ii. Foreign Currency Risk:

There are no Foreign Currency transactions during the financial year.

iii. Foreign Currency Sensitivity:

There are no Foreign Currency transactions during the financial year.

iv. Credit Risk:

Credit risk is the risk that counterparty might not honor its obligations under a financial
instrument or customer contract, leading to a financial loss. The company is exposed to
credit risk from its operating activities (primarily trade receivables).

v. Trade Receivables:

Customer credit risk is managed based on company’s established policy, procedures and
controls. The company assesses the credit quality of the counterparties, taking into
account their financial position, past experience and other factors.

Credit risk is reduced by receiving pre-payments and export letter of credit to the extent
possible. The Company has a well-defined sales policy to minimize its risk of credit
defaults. Outstanding customer receivables are regularly monitored and assessed. The
Company follows the simplified approach for recognition of impairment loss and the
same, if any, is provided as per its respective customer's credit risk as on the reporting
date.

vi. Liquidity Risk:

Liquidity risk is the risk, where 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 approach is to ensure, as far as possible, that it will
have sufficient liquidity to meet its liabilities when due.