3.5 PROVISIONS
A provision is recognized if, as a result of a past event, the Company has a present legal or constructive
obligation that is reasonably estimable, and it is probable that an outflow of economic benefits will be
required to settle the obligation. Provisions are determined by discounting the expected future cash flows at
a pre-tax rate that reflects current market assessments of the time value of money and the risks specific to
the liability.
Contingent liabilities are not recognised but are disclosed by way of notes to the financial statements, after
careful evaluation by the management of the facts and legal aspects of each matter involved. Contingent
assets are neither recognised nor disclosed in the financial statements.
Contingent liabilities are assessed continually to determine whether an outflow of resources embodying the
economic benefit has become probable. If it becomes probable that an outflow of future economic benefits
will be required for an item previously dealt with as contingent liability, a provision is recognised in the
financial statements of the period in which the change in probability occurs.
3.6 BORROWING COST
Borrowing costs that are attributable to the acquisition or construction of qualifying assets are capitalized
as part of the cost of such assets to the extent they relate to the period till such assets are ready to be
put to use, while other borrowing costs are recognized as expenses in the year in which they are incurred. A
qualifying asset is one that necessarily takes substantial period of time to get ready for its intended use.
3.7 INVENTORIES
Inventories other than scrap and goods in transit have been valued at lower of cost and net realisable
value. The cost is ascertained as below:-
i) Finished goods are valued at lower of cost or net realizable value on first in first out (FIFO) basis.
ii) Scrap is valued at the net realisable value.
Where, net realisable value represents the estimated selling price for inventories less all estimated costs of
completion and costs necessary to make the sale.
3.8 EMPLOYEE BENEFITS
(i). Short-term employee benefits
The undiscounted amount of short-term employee benefits expected to be paid in exchange of services
rendered by employees is recognised during the period when the employee renders the services. These
benefits include salaries, bonus and performance incentives.
3.9 FOREIGN CURRENCY TRANSACTIONS
In preparing the financial statements of the Company, transactions in currencies other than the
company’s functional currency i.e. foreign currencies are recognised at the rates of exchange prevailing at
the dates of the transactions. At the end of each reporting period, monetary items denominated in foreign
currencies are retranslated at the rates prevailing at that date. Non-monetary items that are measured in
terms of historical cost in a foreign currency are not retranslated.
Exchange differences on monetary items are recognised in the statement of profit or loss in the period in
which they arise.
Foreign currency derivatives are initially recognised at fair value at the date the derivative contracts are
entered into and are subsequently re-measured to their fair value at the end of each reporting period. The
resulting gain or loss is recognised in profit or loss immediately unless the derivative is designated and
effective as a hedging instrument, in which event the timing of the recognition in profit or loss depends on
the nature of the hedging relationship and the nature of the hedged item.
3.10 TAXATION
Income tax expense represents the sum of the tax currently payable and deferred tax.
Current tax
The tax currently payable is based on taxable profit for the year. Taxable profit differs from profit before
tax as reported in the statement of profit and loss because of items of income or expense that are taxable or
deductible in other years and items that are never taxable or deductible. The Company’s current tax is
calculated using tax rates that have been enacted or substantively enacted by the end of the reporting
period.
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 are generally recognised for all taxable temporary differences. Deferred tax
assets are generally recognised for all deductible temporary differences to the extent that it is
probable that taxable profits will be available against which those deductible temporary differences can be
utilised.
The carrying amount of deferred tax assets is reviewed at the end of each reporting period and reduced to
the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of
the asset to be recovered.
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 measurement of deferred tax liabilities and assets reflects the tax consequences that would follow
from the manner in which the Company expects, at the end of the reporting period, to recover or settle the
carrying amount of its assets and liabilities.
Current and deferred tax for the year
Current and deferred tax are recognised in the Statement of Profit and Loss, except when they relate to
items that are recognised in other comprehensive income or directly in equity, in which case, the current
and deferred tax are also recognised in other comprehensive income or directly in equity respectively.
3.11 REVENUE RECOGNITION
a) Sales are recognised on dispatch of goods.
b) Interest income is recognized using effective interest method.
c) Commision are Recognised on dispatch of goods.
3.12 OPERATING SEGMENT
Operating segments are reported in the manner consistent with the internal reporting provided to the chief
operating decision maker (CODM). The Managing Director of Sylph Technologies Limited has been identified
as CODM and he is responsible for allocating the resources, assess the financial performance and position of
the Company and makes strategic decisions.
The Company has identified one reportable segment "Trading of stainless steels" based on the information
reviewed by the CODM. Refer note 38 for the Segment information presented.
3.13 CASH FLOW STATEMENT
The Cash Flow Statement is prepared by the indirect method set out in Indian Accounting Standard-7 on Cash
Flow Statements and presents cash flows by operating, investing and financing activities of the Company.
The Company considers all highly liquid financial instruments,which are readily convertible into cash, to be
cash equivalents.
3.14 EARNINGS PER SHARE
Basic earnings per share are calculated by dividing the net profit for the period attributable to equity
shareholders by the weighted average number of equity shares outstanding during the period.The weighted
average number of equity shares outstanding during the period and for all periods presented is adjusted for
events, such as bonus shares, other than the conversion of potential equity shares that have changed the
number of equity shares outstanding without a corresponding change in resources. For the purpose of
calculating diluted earnings per share, the net profit for the period attributable to equity shareholders
and the weighted average number of shares outstanding during the period is adjusted for the effects of all
dilutive potential equity shares.
3.15 FINANCIAL INSTRUMENTS
Financial assets and financial liabilities are recognised when the Company becomes a party to the
contractual provisions of the instruments.
Financial assets and financial liabilities are initially measuredat fair value. Transaction costs that are directly
attributableto the acquisition or issue of financial assets and financial liabilities (other than financial assets
and financial liabilities at fair value through profit or loss) are added to or deducted from the fair value of
the financial assets or financial liabilities, as appropriate, on initial recognition.
Transaction costs directly attributable to the acquisition of financial assets or financial liabilities at fair value
through profit or loss are recognised immediately in profit or loss.
3.16 FINANCIAL ASSETS
All recognised financial assets are subsequently measured in their entirety at either amortised cost or fair
value, depending on the classification of the financial assets.
For F H M S V & Co. By the Order of The Board
Chartered Accountants Sylph Technologies Limited
Sd/- Sd/-
Sd/- Vishal Mehra Nilesh jain
Partner Director Director
Membership No.169020 DIN: 09717741 DIN: 07785023
F.R.N. No. 0128276W
UDIN: 25169020BMHWVP2656
Place:- Rajkot
Date:- 30th May 2025
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