1.1 Basis for Preparation of Financial Statements:
a) Compliance with Indian Accounting Standards (Ind As)
The Standalone financial statements have been prepared in accordance with Indian
Accounting Standards (Ind As) as per the Companies (Indian Accounting Standards) Rules,
2015 notified under section 133 of the Companies Act, 2013.
The standalone financial statements have been prepared on the historical cost basis except for
certain instruments which are measured at fair values at the end of each reporting period, as
explained in the accounting policies below.
Accordingly, the Company has prepared these Standalone Financial Statements which
comprise the Balance Sheet as at 31 March, 2024, the Statement of Profit and Loss for the
year ended 31 March 2024, the Statement of Cash Flows for the year ended 31 March 2024,
and the Statement of Changes in Equity for the year ended as on that date, and accounting
policies and other explanatory information (together hereinafter referred to as 'Standalone
Financial Statements' or 'financial statements' ).
These financial statements are approved by the Board of Directors on -30/05/2024.
b) Basis of Preparation of financial statements
The separate financial statements have been prepared in accordance with Indian Accounting
Standards (Ind AS) under historical cost convention on accrual basis except the assets and
liabilities which have been measured at Fair Values.
• Financial instruments - measured at fairvalue;
• Assets held for sale - measured at fair value less cost of sale;
• Plan assets under defined benefit plans - measured at fair value
• Employee share-based payments - measured at fair value
• Biological assets - measured at fair value
• In addition, the carrying values of recognized assets and liabilities, designated
as hedged items in fair value hedges that would otherwise be carried at cost, are
adjusted to record changes in the fair values attributable to the risks that are being
hedged in effective hedge relationship.
Current and Non-Current Classification:
The Company presents assets and liabilities in the balance sheet based on current / non¬
current classification.
An asset is classified as current when it satisfies any of the following criteria:
• Expected to be realised, or is intended to be sold or consumed, the Company' s
normal operating cycle.
• held primarily for the purpose of trading;
• It is expected to be realised within twelve months after the reporting date; or
• It is cash or cash equivalent unless restricted from being exchanged or used to settle
a liability for at least twelve months after the reporting period.
All other assets are classified as non-current.
An asset is classified as current when it satisfies any of the following criteria:
• It is expected to be settled in the Company' s normal operating cycle;
• It is held primarily for the purpose of being traded
• It is due to be settled within 12 months after the reporting date; or the Company does
not have an unconditional right to defer settlement of the liability for at least 12
months after the reporting date.
• Terms of a liability that could, at the option of the counterparty, result in its settlement
by the issue of equity instruments do not affect its classification
All other liabilities are classified as non-current,
c) Use of estimates and judgment
The preparation of the financial statements in conformity with Ind AS, management has made
judgments, estimates and assumptions that affect the application of accounting policies and
the reported amounts of assets, liabilities, income and expenses. Actual results may differ from
these estimates.
This note provides an overview of the areas where there is a higher degree of
judgment or complexity. Detailed information about each of these estimates and
judgments is included in relevant notes together with information about
the basis of calculation.
The areas involving critical estimates or judgments are:
d. Standards issued but not effective (based on Exposure drafts available as on
date)
The amendments are proposed to be effective for reporting periods beginning
on or after 1 April 2021.
i).Issue of Ind AS 117 - Insurance Contracts:
Ind AS 117 supersedes Ind AS 104 Insurance contracts. It establishes the
principles for the recognition, measurement, presentation and disclosure of
insurance contracts within the scope of the standard. Under the Ind AS 117
model, insurance contract liabilities will be calculated as the present value of
future insurance cash flows with a provision for risk.
Application of this standard is not expected to have any significant impact on the
Company' s financial statements.
Amendments to existing Standards
Ministry of Corporate Affairs has carried out amendments of the following
accounting standards:
1. Ind AS 103 - Business Combination - nil
2. Ind AS 1, Presentation of Financial Statements and Ind AS 8, Accounting
Policies, Changes in Accounting Estimates and Errors
3. Ind AS 40 - Investment Property - nil
The Company is in the process of evaluating the impact of the new
amendments issued but not yet effective.
e. Estimation of uncertainties relating to the global health pandemic
from COVID-19 (COVID-19):
In assessing the recoverability of assets including trade receivables, unbilled receivables
and investments, the Company has considered internal and external information up to the
date of approval of these standalone financial statements including credit reports and
economic forecasts. The Company has performed sensitivity analysis on the assumptions
used and based on current indicators of future economic conditions, the Company
expects to recover the carrying amount of these assets. The eventual outcome of impact
of the global health pandemic COVID-19 may be different from those estimated as on the
date of approval of these standalone financial statements.
1.2. Ind AS 105: Non-Current Assets held for Sale or Discontinued
Operations:
This standard specifies accounting for assets held for sale, and the presentation
and disclosure for discontinued operations:
(a) Assets that meet the criteria to be classified as held for sale to be measured at
the lower of carrying amount and fair value less cost to sell, and depreciation
on such assets to cease; and
(b) Assets that meet the criteria to be classified as held for sale to be presented
separately in the balance sheet and the results of discontinued operations to
be presented separately in the statement of profit and loss.
1.3 Ind AS 106: Exploration for Evolution of Mineral resources:
This standard specifies the financial reporting for the exploration for evaluation of mineral
resources. In particular, this standard requires:
a. Limited improvements to existing accounting practices for exploration and evaluation of
expenditures
b. Entities that recognize exploration and evaluation of assets to assess such assets for
impairment in accordance with this standard and measure any impairment.
Disclosures that identify and explain the amounts in the entity' s financial statements arising
from the exploration for the evaluation of mineral resources and help users of those financial
statements understand the amount, timing and certainty of future cash flows from any
exploration and evaluation of assets recognized.
This Ind AS 106 not applicable, the company is in the business of Software Services. Hence this
Ind AS does not have any financial impact on the financial statements of the company.
1.4 Ind AS-16; Property. Plant and Equipment;
Property, Plant and Equipment are stated at cost less accumulated depreciation.
Cost of an item of property, plant and equipment comprises its purchase price, including
import duties and non-refundable purchase taxes, after deducting trade discounts and rebates,
any directly attributable cost of bringing the item to its working condition for its intended use
and estimated costs of dismantling and removing the item and restoring the site on which it
is located.
The cost of a self-constructed item of property, plant and equipment comprises the cost of
materials and direct labor, any other costs directly attributable to bringing the item to working
condition for its intended use, and estimated costs of dismantling and removing the item and
restoring the site on which it is located.
Property, plant and equipment which are significant to the total cost of that item of Property
Plant and Equipment and having different useful life are accounted for as separately.
Gains or losses arising from derecognition of property, plant and equipment are measured as
the difference between the net disposal proceeds and carrying amount of the asset is
recognized in the statement of profit or loss when the asset is derecognized.
Depreciation on Property Plant and Equipment is provided on Straight line method.
Depreciation is provided based on useful life as prescribed under part C of the schedule II of
the Companies act, 2013.
Depreciation on additions (disposals) is provided on a pro-rata basis i.e. from (upto) the date
on which asset is ready for use (disposed of).
Impairment
Property Plant and Equipment are evaluated for recoverability whenever events or changes in
circumstances indicate that their carrying amount may not be recoverable. An impairment loss
is recognised for the amount by which the asset' s carrying amount exceeds its recoverable
amount. The recoverable amount is the higher of an asset' s fair value less cost of disposal
and value in use. For the purposes of assessing impairment, assets are grouped at the lowest
levels for which there are separately identifiable cash inflows which are largely independent of
the cash inflows from other assets or groups of assets (cash-generating units).
1.5 Impairment Assets (Ind AS 36)
The Company' s non-financial assets, other than deferred tax assets are reviewed at each
reporting date to determine whether there is any indication of impairment. If any such
indication exists, then the asset' s recoverable amount is estimated.
For impairment testing, assets that do not generate independent cash inflows are grouped
together into cash-generating units (CGUs). Each CGU represents the smallest group of assets
that generates cash inflows that are largely independent of the cash inflows of other assets or
CGUs.
The recoverable amount of a CGU (or an individual asset) is the higher of its value in use and
its fair value less costs to sell. Value in use is based on the estimated future cash flows,
discounted to their present value using a pre-tax discount rate that reflects current market
assessments of the time value of money and the risks specific to the CGU (or the asset).
An impairment loss is recognized if the carrying amount of an asset or CGU exceeds its
estimated recoverable amount. Impairment losses are recognised in the statement of profit
and loss. Impairment loss recognised in respect of a CGU is allocated first to reduce the
carrying amount of any goodwill allocated to the CGU, and then to reduce the carrying
amounts of the other assets of the CGU (or group of CGUs) on a pro rata basis.
The books of accounts of the company doesn' t carry any impairment of assets during the
reporting period, hence this accounting standard does not have financial impact on the
financial statements of the company
1.6 Intangible assets (Ind AS 38):
Intangible assets are stated at cost less accumulated amortization and impairment. Intangible
assets are amortized over their estimated useful life on straight line basis.
Subsequent costs are included in assets carrying amount or recognized or recognised as a
separate asset, as appropriate, only when it is probable that future economic benefits
associated with the item will flow to the entity and the cost can be measured reliably.
The residual Values, useful lives and methods of depreciation of Property Plant and Equipment
are reviewed at each Financial year end and adjusted prospectively, if appropriate.
Gains or losses arising from derecognition of Intangible asset are measured as the difference
between the net disposal proceeds and carrying amount of the asset is recognized in the
statement of profit or loss when the asset is derecognised.
The books of accounts of the company doesn' t carry any Intangible assets during the
reporting period, hence this accounting standard does not have financial impact on the
financial statements of the company.
1.7 Cash Flow Statement (Ind AS 7):
Cash flows are reported using the indirect method under Ind AS 7, whereby profit/(loss) before
extraordinary items and tax is adjusted for the effects of transactions of non-cash nature and
any deferrals or accruals of past or future cash receipts or payments. The cash flows from
operating, investing and financing activities of the Company are segregated based on the
available information.
Cash comprises cash on hand and demand deposits with banks. Cash equivalents are short¬
term balances (with an original maturity of three months or less from the date of acquisition),
highly liquid investments that are readily convertible into known amounts of cash and which
are subject to insignificant risk of changes in value.
1.8 Operating Cycle:
The Company has adopted its normal operating cycle as twelve months based on the nature
of products and the time between the acquisition of assets for processing and their realization,
for the purpose of current / non-current classification of assets and liabilities.
1.9 Capital Work In Progress
Capital Work in Progress (CWIP) includes Civil Works in Progress, Plant & Equipment under
erection and Preoperative Expenditure pending allocation on the assets to be
acquired/commissioned, capitalized. It also includes payments made to towards technical
know-how fee and for other General Administrative Expenses incurred for bringing the asset
into existence.
1.10 Investments:
Investments are classified as Non-Current and Current investments.
Investments, which are readily realisable and are 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.
Current investments are carried at lower of cost and fair value. Non-Current Investments are
carried at cost less provision for other than temporary diminution, if any, in value of such
investments.
1.11 Effects of changes in Foreign Rates (Ind AS 21):
Foreign currency transactions are recorded at the exchange rates prevailing on the dates when
the relevant transactions took place. Exchange difference arising on settled foreign currency
transactions during the year and translation of assets and liabilities at the yearend are
recognized in the statement of profit and loss.
In respect of Forward contracts entered into to hedge risks associated with foreign currency
fluctuation on its assets and liabilities, the premium or discount at the inception of the contract
is amortized as income or expense over the period of contract. Any profit or loss arising on
the cancellation or renewal of forward contracts is recognized as income or expense in the
period in which such cancellation or renewal is made.
The company has not entered any foreign exchange transactions during the reporting period,
hence this accounting standard does not have financial impact on the financial statements.
1.12 Borrowing Costs (Ind AS 23):
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 those assets, until such time as
the assets are substantially ready for the intended use or sale.
Investment income earned on temporary investment of specific borrowings pending their
expenditure on qualifying assets is recognised in statement of profit and loss.
Discounts or premiums and expenses on the issue of debt securities are amortised over the
term of related securities are included within borrowing costs. Premiums payable on early
redemptions of debt securities, in lieu of future costs, are recognised as borrowing costs.
All other borrowing costs are recognised as expenses in the period in which it is incurred.
1.13 Revenue Recognition (Ind AS 18):
Revenue is recognized to the extent that it is probable that the economic benefits will flow to
the Company and the revenue can be reliably measured. The following specific recognition
criteria must also be met before revenue is recognized:
a) Sales Revenue is recognized on dispatch to customers as per the terms of the order. Gross
sales are net of returns and applicable trade discounts and excluding GST billed to the
customers.
b) Subsidy from Government is recognized when such subsidy has been earned by the
company and it is reasonably certain that the ultimate collection will be made.
c) Interest income is recognized on a time proportion basis taking into account the amount
outstanding and the applicable interest rate. Interest income is included under the head
"other income" in the statement of profit and loss.
d) All other incomes are recognized based on the communications held with the parties and
based on the certainty of the incomes.
1.14 Accounting for Government Grants and Disclosure of Government Assistance (Ind AS
20):
Government grants:
Government grants are not recognised until there is reasonable assurance that
the Company will comply with the conditions attached to them and that the
grants will be received.
Government grants are recognised in the Statement of Profit and Loss on a
systematic basis over the years in which the Company recognises as expenses the
related costs for which the grants are intended to compensate or when
performance obligations are me.
Government grants, whose primary condition is that the Company should
purchase, construct or otherwise acquire non-current assets and nonmonetary
grants are recognised and disclosed as 'deferred income' under non-current
liability in the Balance Sheet and transferred to the Statement of Profit and Loss
on a systematic and rational basis over the useful lives of the related assets.
The benefit of a government loan at a below-market rate of interest and effect of
this favourable interest is treated as a government grant. The loan or assistance
is initially recognised at fair value and the government grant is measured as the
difference between proceeds received and the fair value of the loan based on
prevailing market interest rates and recognised to the income statement
immediately on fulfillment of the performance obligations. The loan is
subsequently measured as per the accounting policy applicable to financial
liabilities.
1.15 Inventories (Ind AS 2):
Inventories are assets:
a. Held for sale in the ordinary course of business;
b. In the process of production for such sale;
c. In the form of materials or supplies to be consumed in the production process or in the
rendering of services
Net Realisable value is the estimated selling price in the ordinary course of business less the
estimated costs of completion and the estimated costs necessary to make the sale.
Fair value is the price that would be received to sell an asset or paid to transfer a liability in an
orderly transaction between market participants at the measurement date.
Inventories at the year-end are valued as under:
Raw Materials, Packing Material, At Cost as per First in First out Method
Components, Consumables and Stores (FIFO).
& Spares
Work In Progress and Finished goods At lower of net realizable value and Cost
of Materials plus Cost of Conversion and
other costs incurred in bringing them to
the present location and condition.
• Cost of Material excludes duties and taxes which are subsequently recoverable.
• Stocks at Depots are inclusive of duty, wherever applicable, paid at the time of dispatch from
Factories.
• Based on the information provided the difference between physical verification and valuation
of the of inventories are charged to the profit and loss account.
1.16 Trade Receivables - Doubtful debts:
A Trade receivable represents the company' s right to an amount of consideration that is
unconditional.
Provision is made in the Accounts for Debts/Advances which is in the opinion of Management
are Considered doubtful of Recovery.
1.17 Retirement and other Employee Benefits:
Retirement benefit in the form of provident fund is a defined contribution scheme. The
Company has no obligation, other than contribution payable to the provident fund. The
Company recognizes contribution payable to the provident fund scheme as expenditure, when
an employee renders related service.
Gratuity liability is a defined benefit obligation and the cost of providing the benefits under
this plan is determined on the basis of actuarial valuation at each year-end. Actuarial valuation
is carried out for this plan using the projected unit credit method. Actuarial gains and losses
for defined benefits plan is recognized in full in the period in which they occur in the statement
of profit and loss.
Accumulated leave, which is expected to be utilized within the next 12 months, is treated as
short term employee benefit. The Company measures the expected cost of such absences as
the additional amount that it expects to pay as a result of the unused entitlement that has
accumulated at the reporting date.
The Company treats accumulated leave expected to be carried forward beyond twelve months,
as long-term employee benefit for measurement purposes. Such long-term compensated
absences are provided for based on the actuarial valuation using the projected unit credit
method at the year-end. Actuarial gains/losses are immediately taken to the statement of
profit and loss and are not deferred. The Company presents the leave as a current liability in
the balance sheet, to the extent it does not have an unconditional right to defer its settlement
for 12 months after the reporting date.
1.18 Ind AS 17- Leases
A Lease is classified as a Finance Lease if it transfers substantially all the risks and rewards
incidental to ownership. A lease is classified as an operating lease if it does not transfer
substantially all the risks and rewards incidental to ownership.
Finance charges in respect of finance lease obligations are recognized as finance costs in the
statement of profit and loss. In respect of operating leases for premises, which are cancellable
/ renewable by mutual consent on agreed terms, the aggregate lease rents payable are
charged as rent in the Statement of Profit and Loss.
1.19 Insurance Claims:
Insurance Claims are accounted for on the basis of claims admitted/expected to be admitted
and to the extent that the amount recoverable can be measured reliably and it is reasonable
to expect ultimate collection.
1.20 Earnings per Share (Ind AS 33):
Basic earnings per share are calculated 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. Partly paid equity shares are treated as a fraction of an equity
share to the extent that they are entitled to participate in dividends relative to a fully paid
equity share during the reporting period. The weighted average number of equity shares
outstanding during the period is adjusted for events such as bonus issue, bonus element in a
rights issue, share split, and reverse share split (consolidation of 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 or loss for the period
attributable to equity shareholders and the weighted average number of shares outstanding
during the period are adjusted for the effects of all dilutive potential equity shares.
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