Note -1

1. Corporation Information:

The Company was originally formed as a Limited Liability Partnership in the name and style of "Chetana Publications (India) LLP" under the provisions of the Limited Liability Partnership Act, 2008 on December 30, 2017, vide Certificate of Incorporation issued by Central Registration Centre, Registrar of Companies. Consequently, the name was changed to 'Chetana Education LLP', and a fresh certificate of incorporation dated October 17, 2021, was issued by the ROC Subsequently, the Company was converted into a public limited company under the Companies Act with the name 'Chetana Education Limited' pursuant to a fresh certificate of incorporation dated January 21, 2024, was issued by the Registrar of Companies, Mumbai, Maharashtra, bearing CIN: U58111MH2024PLC417778. The Company is engaged in educational book publishing for the CBSE/State Board curriculum catering to the K-12 segments. In addition to traditional print publications, the company also provides access to educational software featuring learning videos through QR (Quick Response) codes, enhancing the learning experience and accessibility to users.

2. Significant Accounting Policies:

i. Basis of preparation of Financial Statements:

The financial statements have been prepared in accordance with the generally accepted accounting principles in India under historical cost convention on accrual basis. The accounting policies have been consistently applied by the Company and are consistent with those used in the previous year. Consequently, these statements have been prepared to comply in all material respect with the Companies (Accounts) Rules, 2014 and the relevant provisions of the Companies Act, 2013. All the assets and liabilities have been classified as current and non-current as per the company's operating cycle and other criteria set out in the Schedule III to the Companies Act, 2013. Based on the nature of products and services, and the time between the acquisition of assets and realization in cash or cash equivalents, the company has ascertained its operating cycle as 12 months for the purposes of current and noncurrent classification of assets and liabilities.

ii. Use of Estimates:

The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities at the date of the financial statements and the results of operations during the reporting period. Although these estimates are based upon management's best knowledge of current events and actions, actual results could differ from these estimates.

iii. Property, Plant and Equipment’s - Tangible Assets

Tangible Assets are stated at acquisition cost, net of accumulated depreciation and accumulated impairment losses, if any. Subsequent expenditure related to an item of fixed assets is added to its book value only if it increases the future benefits from the existing assets beyond its previously assessed standard of performance.

Depreciation is calculated on the Written-down Value (WDV) method over the estimated useful lives of the assets. The residual value of all assets is assumed 5% based on historical trend of the Company.

iv. Intangible Assets:

Intangible assets are stated at acquisition cost, net of accumulated amortization and accumulated impairment loss, if any. Intangible assets are amortized on the basis of written down value method over their estimated useful lives. A rebuttable presumption that the useful life on an intangible asset will not exceed ten years from the date which the assets is available for use is considered by the management. The amortization period and the amortization method are reviewed at least at each financial year end and if the expected useful life of the asset is significantly different from previous estimates, the amortization period is changed accordingly.

v. Impairment of Assets:

Assessment is done at each balance sheet date as to whether there is any indication that an asset (tangible or intangible) may be impaired. For the purpose of assessing impairment, the smallest identifiable group of assets that generates cash inflows from continuing use that are largely independent of the cash flows from other assets or groups of assets, is considered as a cash generating unit. If any such indicate exists, an estimate of the recoverable amount of the asset/cash generating unit is made. Assets whose carrying value exceeds their recoverable amount are written down to the recoverable amount. Recoverable amount is higher of an asset's or cash generating unit's net selling price and its value in use. Value in use is the present value of estimated future cash flows expected to arise from the continuing use of the asset and from its disposal at the end of its useful life. Assessment is done at each balance sheet date as to whether there is any indication that an impairment loss recognized for an asset in prior accounting periods may no longer exist or may have decreased.

vi. Borrowing Costs:

Borrowing cost includes interest and amortization of ancillary costs incurred in connection with the arrangement of borrowings. Borrowing costs directly attributable to the acquisition, construction or production of an asset that necessarily takes a substantial period of time to get ready for its intended use or sale are capitalized as part of the cost of the respective asset. All other borrowing costs are expensed in the period they occur.

vii. Investments:

Investments, which are readily realizable and intended to be held for not more than one year from the date on which such investments are made, are classified as current investments. All other investments are classified as non-current investments.

On initial recognition, all investments are measured at cost. The cost comprises purchase price and directly attributable acquisition charges such as brokerage, fees and duties.

Current investments are carried in the financial statements at lower of cost and fair value determined on an individual investment basis. Non-Current investments are carried at cost. However, provision for diminution in value is made to recognize a decline other than temporary in the value of the investments.

On disposal of an investment, the difference between its carrying amount and net disposal proceeds is charged or credited to the statement of profit and loss.

viii. Inventories:

Inventories are valued at the lower of cost and net realisable value.

Costs incurred in bringing each product to its present location and condition are accounted for as follows:

(a) Raw materials, Work-in-progress, packing materials, consumables, stores and spares, are valued at lower of cost and net realisable value. However, materials and other items held for use in the production of inventories are not written down below cost if the finished products in which they will be incorporated are expected to be sold at or above cost.

The cost comprises of costs of purchase, duties and taxes (other than those subsequently recoverable) and other costs after deducting discounts and rebates which are incurred in bringing them to their present location and condition. Cost is determined on weighted average basis.

(b) Finished goods are valued at the lower of cost and net realizable value. Cost is determined using the retail method, commonly employed in the retail sector for assessing inventories of numerous swiftly changing items with comparable margins, where alternative costing methods are impractical. The inventory's cost is established by deducting an appropriate percentage gross margin from its sales value, accounting for items marked down below their original selling price. This valuation is further adjusted for potential obsolescence and costs related to slow-moving stock, as deemed necessary.

(c) Stocks in trade (Traded goods) are valued at lower of cost and net realisable value. Cost includes direct materials valued on weighted average basis, and other costs incurred in bringing them to their present location and condition.

(d) Scraps are valued at estimated net realisable value.

ix. Revenue Recognition:

(a) Sale of Goods: Sales are recognised, net of returns and trade discounts, on transfer of significant risks and rewards of ownership to the buyer, which generally coincides with the delivery of goods to customers. Sales includes postage, freight etc. collected from the customers. Sales are recorded at Invoice Value. Net Revenue excludes, Goods and Service Tax and other statutory levies

(b) Other Income: Interest income on fixed deposits and loans is recognized on a time proportion basis taking into account the amount outstanding and the rate applicable.

Interest on tax refunds is recognized on actual receipt of the refund money or on communication from Income Tax department, whichever is earlier.

Dividend income is accounted for when the right to receive it is established.

x. Foreign Currency Translation:

(a) Initial Recognition: On initial recognition, all foreign currency transactions are recorded by applying to the foreign currency amount the exchange rate between the reporting currency and the foreign currency at the date of the transaction.

(b) Subsequent recognition: All monetary assets and liabilities in foreign currency are restated at the end of accounting period.

(c) Exchange differences on restatement of all other monetary items are recognized in the statement of Profit and Loss.

xi. Employees Benefits:

(a) Contribution to the provident fund, ESI which is a defined contribution plans, are charged to the Statement Profit and Loss in the period in which the liability is incurred.

(b) Provision for gratuity, which is a defined benefit plan, is funded through scheme administered by the Life Insurance Corporation of India ('LIC'). Based on the actuarial values computed by LIC, the contributions to the funded scheme are made by the company. Gratuity are provided on the basis of the actuarial valuation as at the date of the Balance Sheet. The Company's liability is actuarially determined (using the projected unit credit method) at the end of each year. Actuarial losses/gains are recognized in the Statement of Profit and Loss in the year in which they arise.

(c) Leave Encashment: Earned Leaves are neither encashable nor can be carried forward to the next year.

xii. Government Grants:

(a) Government grants are recognised when there is reasonable assurance that the Company will comply with the conditions attaching to them and that the grants will be received.

(b) Incentives on exports related to operations as provided by government are recognised in books after due consideration of certainty of utilisation / receipt of such incentive.

xiii. Segment Accounting:

Business Segment

(a) The business segment has been considered as the primary segment.

(b) The Company's primary business segments are reflected based on principal business activities, the nature of service, the differing risks and returns, the organization structure and the internal financial reporting system.

(c) The Company's primary business is knowledge based and engaged in Educational Book Publishing for CBSE/State Board curriculum for K-12 segment in print and digital medium, and accordingly this is the only segment as envisaged in Accounting Standard 17 'Segment Reporting' therefore disclosure for Segment reporting is not applicable.

xiv. Accounting for Taxes on income:

(a) Tax expense comprises of current and deferred tax. Current income tax is measured at the amount expected to be paid to the tax authorities in accordance with the Income-tax Act, 1961 enacted in India. The tax rates and tax laws used to compute the amount are those that are enacted or substantively enacted, at the reporting date.

(b) Deferred income taxes reflect the impact of timing differences between taxable income and accounting income originating during the current year and reversal of timing differences for the earlier years. Deferred tax is measured using the tax rates and the tax laws enacted or substantively enacted at the reporting date.

(c) Deferred tax liabilities are recognized for all taxable timing differences. Deferred tax assets are recognized for deductible timing differences only to the extent that there is reasonable certainty that sufficient future taxable income will be available against which such deferred tax assets can be realized. In situations where the Company has unabsorbed depreciation or carry forward tax losses, all deferred tax assets are recognized only if there is virtual certainty supported by convincing evidence that they can be realized against future taxable profits.

(d) The carrying amount of deferred tax assets are reviewed at each reporting date. The company writes-down the carrying amount of a deferred tax asset to the extent that it is no longer reasonably certain or virtually certain, as the case may be, that sufficient future taxable income will be available against which deferred tax asset can be realized. Any such write-down is reversed to the extent that it becomes reasonably certain or virtually certain, as the case may be, that sufficient future taxable income will be available.

xv. Leases:

Leases, where the lessor effectively retains substantially all the risks and benefits of ownership of the leased item,

are classified as operating leases. Operating lease payments are recognized as an expense in the Statement of Profit

and Loss on a straight-line basis over the lease term.

xvi. Provisions and Contingent Liabilities:

(a) Provisions: Provisions are recognised when there is a present obligation as a result of a past event, it is probable that an outflow of resource's embodying economic benefits will be required to settle the obligation and there is a reliable estimate of the amount of the obligation.

Provisions are measured at the best estimate of the expenditure required to settle the present obligation at the Balance Sheet date and are not discounted to its present value.

(b) Contingent liabilities: Contingent liabilities and commitments are not recognized but are disclosed in the notes to financials.

(c) Contingent Assets: Contingent Assets are not recognized in the financial statements since this may result in the recognition of income that may never be realized.

xvii. Earnings Per Share:

Basic earnings per share is computed by dividing the net profit or loss for the period attributable to equity shareholders by the weighted average number of equity shares outstanding during the period. Earnings considered in ascertaining the Company's earnings per share is the net profit for the period after deducting any attributable tax thereto for 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.

xviii. Cash and Cash Equivalents:

Cash and Cash equivalents in the cash flow statement includes Cash on hand, other balances with including shortterm investments in Fixed Deposits with an original maturity of three months or less.