6. Provisions and 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. Provisions are not recognised for future
operating losses.
Provisions are measured at the present value of management's best estimate of the expenditure
required to settle the present obligation at the end of the reporting period.
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.
7. Revenue recognition
The revenue from contract with customer is recognised upon transfer of control of promised
product o services to the customer in an amount that reflect the consideration, which the
company expect to receive in exchange of product or service. The revenue is measured based on
the transaction price, which is the consideration, adjusted for discount and other incentives if any.
The Amount of consideration to which the company expect to be entitled in exchange for
transferring promised goods or service to a customer excluding amounts collected on behalf of
third parties (Duties & Taxes on behalf of Government).
The specific recognition criteria from various steam of revenue are described as under:
(i) Sales of Goods:
Revenue from sales of the goods is recognised when the control of the goods has been
passed to the customers as per terms of agreement and there is no continuing effective
control or managerial involvement with goods.
(ii) Interest Income:
Interest income is accrued on a time basis, by reference to the principal outstanding
amount and at the effective interest rate applicable, the future cash receipt through the
expected life of the financial asset to that asset's carrying amount on initial recognition.
8. Trade Receivable
A receivable represents the company's right to an amount of consideration that is
unconditional i.e., only passage of time required before payment of consideration is due.
The Expected credit loss is mainly based on the historical experience. The receivables are
assessed on an individual basis for credit loss. The trade receivables are written of on cases-
to-cases basis, if deemed not to be collectable on assessment and circumstances.
9. Employee benefits
Employee's benefit includes gratuity, compensated absences, contribution to provided
fund, employees state insurance and superannuation fund.
(i) Short-term Benefits
Employee benefit payable wholly within 12 months of rendering services are classified as
short-term employee benefit and recognised in the period which the employee renders
services. These are recognised at the undiscounted amount of the benefit expected to be
paid in exchange for those services.
(ii) Post-employment Benefit
(a) Defined contribution Plan
Retirement benefit in the form of provident fund and superannuation fund are defined
contribution schemes. The company has no obligation other than the contribution
payable to the provident fund. The company recognises contribution payable to such
funds as an expenditure, when an employee renders services.
(b) Defined Benefit Plans
The company operates a defined benefit gratuity plan. The cost of providing benefit
under the defined benefit plan is determined based un actuarial valuation, carried out
by an independent actuary.
Remeasurement gains or losses arising from changes in actuarial assumptions, the
same are recognised immediately in balance sheet through other comprehensive
income in the period in which they occurred.
(c) Other Long-term employee Benefits
Other long-term employee benefits include compensated absences / leaves. The
actuarial valuation is done as per projected unit method. Remeasurement gains or
losses arising from changes in actuarial assumptions, the same are recognised
immediately in balance sheet through other comprehensive income in the period in
which they occurred.
(d) For the purpose of the presentation of the defined benefit plans and other long-term
benefits, the allocation between current and noncurrent provision has been made as
determined by the actuary.
10. Foreign currency translation
a) Functional and presentation currency
The financial statements are presented in Indian rupee (INR), which is Company's functional and
presentation currency.
b) Transactions and balances
Transactions in foreign currencies are recognised at the prevailing exchange rates on the
transaction dates. Realised gains and losses on settlement of foreign currency transactions are
recognised in the Statement of Profit and Loss.
Monetary foreign currency assets and liabilities at the year-end are translated at the year-end
exchange rates and the resultant exchange differences are recognised in the Statement of Profit
and Loss.
11. Earnings Per Share
Basic earnings per share (EPS) are computed by dividing the profit or loss attributable to the equity
shareholders of the company by the weighted average number of equities shares outstanding
during the year.
Diluted earnings per share is computed by adjusting the profit or loss attributable to the ordinary
equity shareholders and the weighted average number of equity shares, for the effects of all
diluted potential equity shares.
12. Government Grants
Grants from the government are recognised at their fair value where there is reasonable
assurance that the grant will be received and the Company will comply with all attached
conditions.
Government grants relating to the purchase of property, plant and equipment are included in non¬
current liabilities as deferred income and are credited to Profit and Loss on a straight - line basis
over the expected lives of related assets and presented within other income.
13. Cash and Cash Equivalents
The Company considers all highly liquid financial instruments, which are readily convertible into
known amounts of cash that are subject to an insignificant risk of change in value and having
original maturities of three months or less from the date of purchase, to be cash equivalents. Cash
and cash equivalents consist of balances with banks which are unrestricted for withdrawal and
usage.
14. Income tax
The income tax expense or credit for the period is the tax payable on the current period's taxable
income based on the applicable income tax rate adjusted by changes in deferred tax assets and
liabilities attributable to temporary differences and to unused tax losses.
Deferred income tax is provided in full, using the liability method on temporary differences arising
between the tax bases of assets and liabilities and their carrying amount in the financial
statement. Deferred income tax is determined using tax rates (and laws) that have been enacted
or substantially enacted by the end of the reporting period and are expected to apply when the
related deferred income tax assets is realised or the deferred income tax liability is settled.
Deferred tax assets are recognised for all deductible temporary differences and unused tax losses,
only if, it is probable that future taxable amounts will be available to utilise those temporary
differences and losses.
Deferred tax assets and liabilities are offset when there is a legally enforceable right to offset
current tax assets and liabilities and when the deferred tax balances relate to the same taxation
authority. Current tax assets and tax liabilities are off set where the Company has a legally
enforceable right to offset and intends either to settle on a net basis, or to realize the asset and
settle the liability simultaneously.
Current and deferred tax is recognised in the Statement of Profit and Loss, except to the extent
that it relates to items recognised in other comprehensive income or directly in equity. In this
case, the tax is also recognised in other comprehensive income or directly in equity, respectively.
Other disclosures forming part of the standalone Ind AS Financial Statements
30. Financial Instruments - Disclosure
Financial assets and financial liabilities are recognized when Company becomes a party to the
contractual provisions of the instruments. Financial assets and financial liabilities are initially
measured at fair value. Transaction costs that are directly attributable to 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
recognized immediately in the Statement of Profit and Loss.
(i) Capital management
The Company's objective when managing capital is to:
- Safeguard its ability to continue as going concern so that the company is able to provide
maximize return to stakeholders and benefits for other stakeholders.
- Maintain an optimal capital structure to reduce the cost of capital.
The company board of directors reviews the capital structure on a regular basis. As part of this
review, the board considers cost of capital, risk associated with each class of capital
requirements and maintenance of adequate liquidity.
Disclosures
This section gives an overview of the significance of financial instruments for the company and
provides additional information on balance sheet item that contain financial instruments. The
details of significant accounting policies, including the criteria for recognition, the basis of
measurement and the basis on which income and expenses are recognized in respect of each
class of financial asset, financial liability and equity instrument are disclosed in notes.
The carrying amount of current financial assets and liabilities as at the end of each year
presented approximate the fair value because of their short-term nature. The trade
receivables, trade payables, borrowings, capital creditors and cash and cash equivalents are
considered to be the same as their fair values, due to their short-term nature.
(ii) Fair value measurements
This note provides information about how the company determines fair value of various
financial assets. Management considers that the carrying amounts of financial assets and
financial liabilities recognized in the financial statements approximate their fair values.
(iii) Fair value hierarchy
The fair value hierarchy is based on inputs to valuation techniques that are used to
measure fair value that are either observable or unobservable and consists of the
following three levels:
Level 1: Inputs are quoted prices in active markets for identical assets or liabilities.
Level 2: Inputs are other than quoted price included within level 1 that are observable for
the asset or liability, either directly or indirectly.
Level 3: Inputs are not based on observable market data. Fair values are determined in
whole or in part using a valuation model based on the assumptions that are neither
supported by prices from observable current market transactions in the same instrument
nor are they based on available market data
1. The Company did not have any long-term contracts, including derivatives contract for which there
were any material foreseeable losses.
31. Financial Risk Management Framework
The company's principal financial liabilities comprise loans and borrowings, trade and other
payables. The main purpose of these financial liabilities is to finance the company's operations.
The company's principal financial assets include trade and other receivables, receivables from
government authorities, security deposits and cash and cash equivalents that derive directly from
its operations. The company also holds investments. The corporate treasury function provides
services to the business, co-ordinates access to domestic and international financial markets,
monitors and manages the financial risks relating to the operations of the company through
internal risk reports which analyse exposures by degree and magnitude of risks. These risks include
market risk (including currency risk, interest rate risk and other price risk), credit risk and liquidity
risk.
The company seeks to minimise the effects of these risks by using derivative financial instruments
to hedge risk exposures. The company does not enter into or trade financial instruments, including
derivative financial instruments, for speculative purposes.
The Corporate Treasury function reports quarterly to the Board of Directors of the company for
monitoring risks and reviewing policies implemented to mitigate risk exposures.
Market Risk
Market risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate
because of changes in market prices. Market risk comprises two types of risk: currency risk and
interest rate risk. Financial instruments affected by market risk include loan and borrowings. The
objective of market risk management is to manage and control market risk exposures within
acceptable parameters, while optimising the return. All such transactions are carried out within
the guidelines set by the Board of Directors and Risk Management Committee. There have been
no significant changes to the company's exposure to market risk or the methods in which they are
managed or measured.
Currency Risk
Foreign currency risk is the risk that the fair value or future cash flows of an exposure will fluctuate
because of changes in foreign exchange rates. The company undertakes transactions denominated
in foreign currencies; consequently, exposures to exchange rate fluctuations arise. The company's
exposure to currency risk relates primarily to the company's operating activities and borrowings
when transactions are denominated in a different currency from the company's functional
currency. The company manages its foreign currency risk by hedging transactions that are
expected to occur within a maximum 12-month period for hedges of forecasted sales and
borrowings.
Price Risk
The Company's investments in listed securities, mutual funds, other funds and debentures are
susceptible to market price risk arising from uncertainties about future values of the investment
securities. The Company manages the price risk through diversification and by placing limits on
individual and total equity instruments. Reports on the portfolio are submitted to the Company's
senior management on a regular basis.
Interest Rate Risk
Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will
fluctuate because of changes in market interest rates. The company's exposure to the risk of
changes in market interest rates relates primarily to the company's long-term debt obligations
with floating interest rates. The loans advanced as at March 31, 2024 is Rs. 827.58 lacs (previous
year Rs. 4130.76 lacs ) which are interest bearing and interest rates are variable.
Liquidity risk
i. Liquidity risk management
The company's objective is to maintain optimum levels of liquidity to meet its cash and
collateral requirements at all times. The Chief Financial Officer of the company is
responsible for liquidity risk management who has established an appropriate liquidity risk
management framework for the management of the company's short, medium and long¬
term funding and liquidity management requirements. The company manages liquidity
risk by maintaining adequate reserves, banking facilities and reserve borrowing facilities,
by continuously monitoring forecast and actual cash flows, and by matching the maturity
profiles of financial assets and liabilities. The Chief Financial Officer reports the same to
the Board of Directors on quarterly basis.
36. Other statutory disclosures
• The company do not have any Benami property, where any proceeding has been initiated or
pending against the company for holding any Benami property.
• The company has not carried out any revaluation of it's Property, Plant and Equipment.
• The company holds all properties in it's own name
• The company do not have any transactions with struck off companies.
• The company do not have any charges or satisfaction which is yet to be registered with ROC
beyond the statutory period
• The company have not traded or invested in Crypto currency or Virtual Currency during the
year
• The company have not any such transaction which is not recorded in the books of accounts
that has been surrendered or disclosed as income during the year in the tax assessments
under the Income Tax Act, 1961 (such as, search or survey or any other relevant provisions of
the Income Tax Act, 1961.
• The company have not received any fund from any person(s) or entity(ies), including foreign
entities (Funding Party) with the understanding (whether recorded in writing or otherwise)
that the company shall:
- directly or indirectly lend or invest in other persons or entities identified in any manner
whatsoever by or on behalf of the Funding Party (Ultimate Beneficiaries) or
- provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries,
• The company have not advanced or loaned or invested funds to any other person(s) or
entity(ies), including foreign entities (Intermediaries) with the understanding that the
Intermediary shall:
- directly or indirectly lend or invest in other persons or entities identified in any manner
whatsoever by or on behalf of the company (Ultimate Beneficiaries) or
- provide any guarantee, security or the like to or on behalf of the Ultimate Beneficiaries
As per our Report of even date attached For and on behalf of the Board of directors of
Vaxtex Cotfab Limited
FOR S S R V & Associates
Firm Registration No. 135901W.
Vishnu Kant Kabra
Partner
M. No.: 403437.
PLACE: Ahmedabad MITHILES H AGARWAL PRATAPSINGH ZALA
Managing Director (CFO)
DATE :- 6th July, 2024
DIN 03468643
UDIN: 23403437BGWDJT3566 PAN :AACPZ3621J
AAKASH THAKOR ANAND LOHIA
Director CS
DIN 07960192
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