2 ). MATERIAL ACCOUNTING POLICIES:
A Basis of Preparation and Presentation
i) The financial statements are prepared in accordance with applicable Indian Accounting Standards (Ind AS) and on accounting
principles of going concern. These financial statements have been prepared to comply with all material aspects with the Indian
accounting standards notified under section 133 of the Act, (the "Act") read with Rule 7 of the Companies (Accounts) Rules, 2014,
and the other relevant provisions of the Act.
ii) Accounting policies have been consistently applied except where a newly issued accounting standard is initially adopted or a
revision to an existing accounting standard requires a change in the accounting policies their to in use.
iii) All assets and liabilities have been classified as current or non-current as per the Company's normal operating cycle and other
criteria set out in the Schedule III to the Act. Based on the nature of products and the time between the acquisition of assets for
processing and their realization in cash and cash equivalents, the Company has ascertained its operating cycle as 12 months for the
purpose of current classification of assets and liabilities.
B REVENUE RECOGNITION
i) Revenue is recognised at the transaction value of the consideration received or receivable where the ownership and significant
risk has been transferred to the buyer.
ii) Interest on overdue debtors is accounted for as and when received, as the collection cannot be ascertained with reasonable
certainty.
iii) Sales return are accounted for / provided for in the year in which they pertain to, as ascertained till finalization of the books of
account.
iv) Compensation on account of crop quality discounts are accounted for as and when settled.
C PROPERTY, PLANT AND EQUIPMENTS
i) Land and buildings held for use in the production or supply of goods or services, or for administrative purposes, are stated in the
balance sheet at deemed cost less and accumulated depreciation. Freehold land is not depreciated.
ii) Properties in the course of construction for production, supply or administrative purposes are carried at cost, less any recognised
impairment loss. Cost includes professional fees and, for qualifying assets, borrowing costs capitalised in accordance with the
Company's accounting policy. Such properties are classified to the appropriate categories of property, plant and equipment when
completed and ready for intended use. Depreciation of these assets, on the same basis as other property assets, commences when
the assets are ready for their intended use.
iii) Furniture and equipment are stated at cost less accumulated depreciation and accumulated impairment losses.
iv) An item of property, plant and equipment is derecognised upon disposal or when no future economic benefits are expected to
arise from the continued use of the asset. Any gain or loss arising on the disposal or retirement of an item of property, plant and
equipment is determined as the difference between the sales proceeds and the carrying amount of the asset and is recognised to
the standalone statement of profit and loss.
v) Seed Development know how & software acquired by the company are capitalised at the cost of acquisition. expenses incurred
on brands are capitalised.
vi) Live stock is stated at cost without any depreciation/ impairment
D BIOLOGICAL ASSETS
Recognition and measurement
The company recognises the biological asset (agricultural produce) when:
(a) the company controls the asset as a result of past events;
(b) it is probable that future economic benefits associated with the asset will flow to the company; and
(c) the fair value or cost of the asset can be measured reliably
The biological asset are measured at the end of each reporting period at its fair value less costs to sell.
E CAPITAL WORK-IN-PROGRESS
Expenditure related to and incurred during the implementation of the projects is included under Capital Work-in-Progress and
the same are capitalized under the appropriate heads on completion of the projects.
F DEPRECIATION / AMORTIZATION
A) Depreciation on tangible Property, Plant & Equipments is provided for on the basis of useful life specified in Schedule II to the
Act, which is as under:-
G IMPAIRMENT
i) Assessment is done at each Balance Sheet date as to whether there is any indication that an asset 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 inflows from other assets or groups of assets, is considered as a cash generating unit. If any
such indication 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 an asset and from its disposal at the end of its useful life. Assessment is also
done at each Balance Sheet date as to whether there is any indication that an impairment loss recognised for an asset in prior
accounting periods may no longer exist or may have decreased.
ii) The assets which have completed their respective useful life have been fully impaired and deducted from the cost of assets.
H RESEARCH AND DEVELOPMENT EXPENDITURE:
The research expenditure incurred is charged off to the Statement of Profit & Loss.
I INVENTORIES:
i) Inventories comprise of Unprocessed seeds, Under- Processed Seeds, Processed Seeds, Packing Material and traded goods.
Inventories are valued at the lower of cost or the net realisable value after providing for obsolescence and other losses, where
considered necessary. Cost is determined on Weighted Average basis. Cost includes all charges in bringing the goods to their
present location and condition and receiving charges.
ii) The cost of Under-Processed Seeds and Processed Seeds comprises of Lease Rental, direct labour, other direct costs and
related production overheads. Net realizable 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.
J FOREIGN CURRENCY TRANSACTIONS:
i) Transactions in foreign currency are recorded at the rate prevailing on the date of the transaction.
ii) Monetary Assets and Liabilities in foreign currency outstanding as at the year-end are stated at the rates of exchange
prevailing at the close of the year. The resultant gains/losses of the year are recognized in the Statement of Profit and Loss.
K LEASES :
Leases which are short term and cancellable at the option of lessor / lessee are treated as operating leases and lease rent
payable on such leases is charged to the Statement of Profit and Loss Account.
L EMPLOYEES BENEFITS:
Liability as at the year end in respect of retirement benefits is provided for and/ or funded and charged to Statement of Profit
and Loss as follows:
i) Provident Fund / Family Pensions:
At a percentage of salary/wages for eligible employees.
ii) Retirement benefit costs and termination benefit :
The Company determines the present value of the defined benefit obligation and recognizes the liability or asset in the balance
sheet.
The present value of the obligation is determined using the projected unit credit method, with actuarial valuations being carried
out at the end ofeach year
Defined benefit costs are composed of:
(a) service cost - recognized in profit or loss; service cost comprises (i) current cost which is the increase in the present value of
defined benefit obligations resulting from employee service in the current period, (ii) past service cost which is the increase in
the present value of defined benefit obligations resulting from employee service in the prior periods resulting from a plan
amendment, and (iii) gain or loss on settlement.
(b) remeasurements of the liability or asset - recognized in other comprehensive income.
(c) remeasurements of the liability or asset essentially comprise of actuarial gains and losses (i.e. changes in the present value
of defined benefit obligations resulting from experience adjustments and effects of changes in actuarial assumptions).
Short-term benefits: A liability is recognised for benefits accruing to employees in respect of wages and salaries, annual leave
and sick leave and other short term benefits in the period the related service is rendered at the undiscounted amount of the
benefits expected to be paid in exchange for that service.
Other long-term benefits: Liabilities recognised in respect of other long-term employee benefits are measured at the present
value of the estimated future cash outflows expected to be made by the Group in respect of services provided by employees up
to the reporting date.
iii) Bonus :
The company recognises a liability and expense for bonus. The company recognises a provision where contractually obliged or
where there is past practice that has created a constructive obligation.
M BORROWING COST
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, are added to the cost of those assets, until such
time as the assets are substantially ready for their intended use. All other borrowing costs are recognised in the Statement of
Profit and Loss in the period in which they are incurred. The Company determines the amount of borrowing costs eligible for
capitalisation as the actual borrowing costs incurred on that borrowing during the period less any interest income earned on
temporary investment of specific borrowing pending their expenditure on qualifying assets, to the extent that an entity
borrows funds specifically for the purpose of obtaining a qualifying asset. In case if the Company borrows generally and uses the
funds for obtaining a qualifying asset, borrowing costs eligible for capitalisation are determined by applying a capitalisation rate
to the expenditures on that asset. The Company suspends capitalisation of borrowing costs during extended periods in which it
suspends active development of a qualifying asset
N AGRICULTURAL ACTIVITIES
i) Income from the agricultural activities is accounted for up to the stage of dispatch of goods by the Company to the customer
after processing.
ii) Expenses which are directly related to the agricultural activities have been accounted for in the books of account under the
Head Production Expenses. Expenses which are not related to the specific activities are allocated on the basis of turnover (net of
return and Schemes & Discounts) of Agricultural activities and Trading activities.
O EARNING PERSHARE
Basic earnings per share is calculated by dividing the net profit or loss for the year attributable to equity shareholders by the
weighted average number of equity shares outstanding during the year. Earnings considered in ascertaining the Company's
earnings per share is the net profit for the year attributable to equity share holders. The weighted average number of equity
shares outstanding during the year and for all years 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 or loss for the year attributable to
equity shareholders and the weighted average number of shares outstanding during the year is adjusted for the effects of all
dilutive potential equity shares.
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. Such deferred tax assets and liabilities are not recognised if the temporary difference arises from the
initial recognition (other than in a business combination) of assets and liabilities in a transaction that affects neither the taxable profit
nor the accounting profit.
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
Minimum Alternate Tax (MAT) paid in accordance with the tax laws, which gives future economic benefits in the form of adjustment
to future income tax liability, is considered as an asset if there is convincing evidence that the Company will pay normal income tax.
Accordingly, MAT is recognised as an asset in the Balance Sheet when it is highly probable that future economic benefit associated
with it will flow to the Company.
Deferred tax assets and liabilities 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.
Deferred tax assets and deferred tax liabilities are offset if a legally enforceable right exists to set off current tax assets against current
tax liabilities and the deferred taxes relate to the same taxable entity and the same taxation authority.
Current and deferred tax for the period
Current and deferred tax are recognised in profit or 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 recognized in other comprehensive
income or directly in equity respectively. Where current tax or deferred tax arises from the initial accounting for a business
combination, the tax effect is included in the accounting for the business combination.
The Company recognises interest levied and penalties related to Income Tax assessments in the tax expenses.
Q USE OF ESTIMATES
The preparation of Financial Statements requires estimates and assumptions to be made that affect the reported amounts of
assets and liabilities on the date of Financial Statements and the reported amounts of revenues and expenses during the
reporting period. Difference between the actual results and the estimates are recognised in the period in which the results are
known/ materialised.
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