A. Material accounting policies
The material accounting policies applied by the Company in the preparation of its financial statements are
listed below. Such accounting policies have been applied consistently to all the periods presented in these
financial statements, unless otherwise indicated.
A.1. Statement of Compliance
These financial statements have been prepared in accordance with the Indian Accounting Standards (referred
to as "Ind AS") as prescribed under section 133 of the Companies Act, 2013 read with Companies (Indian
Accounting Standards) Rules as amended from time to time. WeP Digital Services Limited, a wholly owned
subsidiary of the company, was amalgamated with the company with the Appointed date as 1st April 2021 in
terms of scheme of arrangement framed under sections 230 and 232 of the Companies Act, 2013. The financial
statements have been prepared in accordance with the scheme of arrangement and in accordance with the
accounting standards.The amalgamation has been given effect to in the books of accounts as per appendix C
of Ind AS-103 governing Business Combinations.
A.2. Basis of preparation
These financial statements have been prepared in Indian Rupees (g) which is the functional currency of the
company.
These financial statements have been prepared on historical cost basis, except for certain financial instruments
which are measured at fair value or amortised cost at the end of each reporting period, as explained in the
accounting policies below. Historical cost is generally based on the fair value of the consideration given in
exchange for goods or services. 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. All assets and liabilities
have been classified as current and non-current as per the Company's normal operating cycle.
A.3. Use of Estimates
The preparation of these financial statements is in conformity with the recognition and measurement principles
of Ind AS which requires the management of the Company to make estimates and assumptions that affect the
reported balances of assets and liabilities, disclosures of contingent liabilities as at the date of the financial
statements and the reported amounts of income and expense for the periods presented.
The estimates and the underlying assumptions are reviewed on an ongoing basis. Changes in estimates are
reflected in the financial statements in the period in which the changes are made.
Significant judgements and estimates relating to the carrying amounts of assets and liabilities include useful
lives of property, plant and equipment and intangible assets, impairment of property, plant and equipment,
intangible assets, provision for employee benefits and other provisions and recoverability of deferred tax
assets.
A.4. Revenue Recognition
The Company earns revenue primarily from Managed Printing Solutions and Services, Manufacturing and
Distribution of Retail Billing Products, trading in multifunctional printers and providing Digital Services like
facilitation in filing of GST returns etc. to both enterprise and retail customers, pan India.
Revenue is recognised upon transfer of control of promised products or services to customers in an amount that
reflects the consideration which the Company expects to receive in exchange for those products or services.
• Contracts with customers are considered for revenue recognition only if (a) the contract having commercial
substance is approved and the parties have committed to perform their respective obligations; (b)
respective rights of the parties with respect to goods or services to be transferred are identified; (c) the
payment terms for goods or services to be transferred are clear and (d) it is probable that consideration
would be collected in exchange for the goods or services that would be transferred to the customer. At
the inception of the contract, either a transfer of distinct good or service to the customer or a series of
distinct goods and services that are substantially the same and that have the same pattern of transfer
to the customer are identified as performance obligation. Revenue is recognised when the performance
obligation is satisfied by transferring the promised good or service to a customer and the customer obtains
controls over it.
• In the case of provision of services such as Managed return filing services, use of ASP-GST software, where
performance obligation is satisfied over time, revenue is recognised over time by measuring the progress
to complete satisfaction of that performance obligation. In respect of revenue from licenses, where the
customer obtains a ""right to use"", the revenue is recognised at the point in time when the license is made
available to the customer and is recognised over the access period.
Dividend income from investments is recognised when the shareholder's right to receive payment has been
established. Interest income is recognised on a time proportion basis.
A.5. Inventories
Inventories are stated at lower of cost and net realizable value. Cost is determined using the weighted average
method. Costs comprise direct materials and, where applicable, direct labour costs and those overheads that
have been incurred in bringing the inventories to their present location and condition. Net realisable value is
the price at which the inventories can be realised in the normal course of business, after allowing for the cost of
conversion from their existing state to a finished condition and for the cost of selling and distribution.
Obsolete, slow moving and defective inventories are identified from time to time and where necessary, a
provision is made for such inventories.
A.6. Property, plant and equipment
An item of property, plant and equipment is recognised as an asset if it is probable that future economic benefits
associated with the item will flow to the Company and its cost can be measured reliably. This recognition
principle is applied to the costs incurred initially to acquire an item of property, plant and equipment and also
to costs incurred subsequently to add to, replace part of, or service it. Borrowing cost directly attributable to the
construction or production of qualifying assets are capitalised as a part of cost. All other repair and maintenance
costs, including regular servicing, are recognised in the Statement of Profit and Loss, as and when incurred.
All property, plant and equipment are stated at cost of acquisition or construction, less accumulated depreciation
and impairment loss, if any. Cost includes all direct costs and expenditures incurred to bring the asset to its
working condition and location for its intended use. Capital Work-in-Progress is stated at cost, comprising of
direct cost and related incidental expenditure. Assets that are not ready for use in the manner as intended by
the Management are shown as Capital work in progress.
The gain or loss arising on disposal of an asset is determined as the difference between the sale proceeds and
the carrying amount of the asset, and is recognised in the Statement of Profit and Loss.
A.7. Intangible assets
Software costs, both acquired and internally generated, are recognised as intangible assets only where they
are clearly linked to long term economic benefits for the Company. They are amortized on a straight-line basis
over their estimated useful lives. All other costs on software are expensed in the Statement of Profit and Loss
as and when incurred.
Expenditure during development phase of internally generated software is recognized as intangible assets if
all of the following conditions are met:
i) completion of the development is technically feasible;
ii) it is the intention to complete the intangible asset and use or sell it;
iii) it is clear that the intangible asset will generate probable future economic benefits;
iv) adequate technical, financial and other resources to complete the development and to use or sell the
intangible asset are available; and
v) it is possible to reliably measure the expenditure attributable to the intangible asset during its development.
Recognition of costs as an asset is ceased when the project is complete and available for its intended use, or
if these criteria no longer apply.
Where development activities do not meet the conditions for recognition as an asset, any associated
expenditure is treated as an expense in the period in which it is incurred
A.8. Depreciation and amortization of property, plant and equipment and intangible assets
Depreciation or amortization is provided on the straight-line method over the useful lives of assets as
estimated by the management. The estimated useful lives of assets are as follows:
A.9. Impairment of Assets
At each balance sheet date, the Company reviews the carrying amounts of its property, plant and equipment
and intangible assets to determine whether there is any indication that the carrying amount of those assets
may not be recoverable through continuing use.
If any such indication exists, the recoverable amount of the asset is reviewed in order to determine the extent of
impairment loss, if any. Where the asset does not generate cash flows that are independent from other assets,
the Company estimates the recoverable amount of the cash generating unit to which the asset belongs.
Recoverable amount is the higher of the fair value, less costs to sell and value in use. In assessing value in use,
the estimated future cash flows are discounted to their present value, using a pre-tax discount rate that reflects
current market assessments of the time value of money and risks specific to the asset, for which the estimates
of future cash flows have not been adjusted. An impairment loss is recognised in the Statement of Profit and
Loss as and when the carrying amount of an asset exceeds its recoverable amount.
Where an impairment loss subsequently reverses, the carrying amount of the asset (or cash generating unit)
is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does
not exceed the carrying amount that would have been determined had no impairment loss been recognised
for the asset (or cash generating unit) in prior years. A reversal of an impairment loss is recognised as income
immediately.
A.10. Foreign Currency Transactions
Foreign currency transactions are recorded at the exchange rate prevailing on the date of transaction.
At the end of each reporting period, all monetary items denominated in foreign currencies are translated at the
rates prevailing as at the balance sheet date. Non-monetary items that are measured in terms of historical cost
in a foreign currency are not translated.
The exchange difference arising on account of the difference between the rates prevailing on the date of
transaction and on the date of settlement, as also on translation of monetary items at the end of the year is
recognized as income or expense, as the case may be, in the Statement of Profit and Loss for the year.
A.11. Financial Instruments
Financial assets and financial liabilities are recognised when the Company becomes a party to the contractual
provisions of the instrument. Financial assets and 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 measured on initial recognition of financial asset or financial liability. Transaction costs directly
attributable to the acquisition of financial assets and financial liabilities at fair value through profit and loss, are
immediately recognised in the Statement of Profit and Loss.
Effective interest method
The effective interest method is a method of calculating the amortised cost of a financial instrument and of
allocating interest income or expense over the relevant period. The effective interest rate is the rate that exactly
discounts future cash receipts or payments through the expected life of the financial instrument, or where
appropriate, a shorter period.
a) Financial assets
Financial assets at amortised cost
Financial assets are subsequently measured at amortised cost, if these financial assets are held within a
business model whose objective is to hold these assets, in order to collect contractual cash flows, and the
contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of
principal and interest on the principal amount outstanding.
Investment in subsidiaries / associates are accounted at cost.
Financial assets measured at fair value
Financial assets are measured at fair value through other comprehensive income, if these financial assets are
held within a business model, whose objective is to hold these assets in order to collect contractual cash flows,
or to sell these financial assets, and the contractual terms of the financial asset give rise on specified dates to
cash flows that are solely payments of principal and interest on the principal amount outstanding.
Financial assets not measured at amortised cost, or at fair value through other comprehensive income, are
carried at fair value through profit or loss.
Impairment of financial assets
The Company assesses, on a forward looking basis, the expected credit losses associated with its assets carried
at amortised cost. The impairment methodology applied depends on whether there has been a significant
increase in credit risk.
For trade receivables, the Company has applied the simplified approach permitted by Ind AS 109 Financial
Instruments, which requires expected lifetime losses to be recognised from initial recognition of the receivables
with effect from April 1, 2017.
Derecognition of financial assets
The Company derecognises a financial asset when the contractual rights to the cash flows from the asset
expire, or it transfers the financial asset and substantially all risks and rewards of ownership of the asset to
another entity.
b) Financial liabilities and equity instruments
Classification as debt or equity
Financial liabilities and equity instruments issued by the Company are classified according to the substance of
the contractual arrangements entered into and the definitions of a financial liability and an equity instrument.
Equity instruments
An equity instrument is any contract that evidences a residual interest in the assets of the Company after
deducting all of its liabilities. Equity is recorded at the proceeds received, net of direct issue costs.
Financial Liabilities
Trade and other payables are initially measured at fair value, net of transaction costs, and are subsequently
measured at amortised cost, using the effective interest rate method.
Interest-bearing bank loans, overdrafts and issued debt are initially measured at fair value and are
subsequently measured at amortised cost using the effective interest rate method. Any difference between
the proceeds (net of transaction costs) and the settlement or redemption of borrowings is recognised
over the term of the borrowings in accordance with the Company's accounting policy for borrowing costs.
Derecognition of financial liabilities
The Company derecognises financial liabilities when the Company's obligations are discharged, cancelled or
they expire.
A.12. Employee Benefits
i. Short Term Employee Benefits
Short Term Employees Benefits are recognized as an expense at the undiscounted amount in the Statement of
Profit and Loss of the year in which the related services is rendered
ii. Other long-term employee benefit obligations
Leave Encashment: Liability in respect of leave encashment as at the balance sheet date is determined based
on actuarial valuation, by using the Projected Unit Credit Method and gains/losses for the year are recognized
immediately in the Statement of Profit and Loss.
iii. Post Employment Benefits
Provident Fund: The Company contributes monthly at a determined rate. These contributions are remitted to
the Employee Provident Fund Commissioner office and are charged to the Statement of Profit and Loss on
accrual basis.
Gratuity: The Company provides for gratuity (a defined benefit retirement plan) to all the eligible employees. The
benefit is in the form of lumpsum payments to vested employees on retirement, on death while in employment,
or termination of employment for an amount equivalent to 15 days' salary, payable for each completed year of
service. Vesting occurs on completion of five years of service. Liability in respect of gratuity as at the balance
sheet date is determined on the basis of actuarial valuation, using the Projected Unit Credit Method. Re¬
measurement gains and losses of the net defined benefit liability/ (asset) are recognised immediately in other
comprehensive income. The service cost, net interest on the net defined benefit liability/ (asset) is treated as
a net expense within employment costs and are recognized immediately in the Statement of Profit and Loss.
iv. Employee Stock Options
All employee services received in exchange for the grant of any share based remuneration are measured at
their fair values. These are indirectly determined by reference to the fair value of the share options awarded.
Their value is appraised at the grant date and excludes the impact of any non-market vesting conditions (for
example, profitability and sales growth targets).
All share-based remuneration is ultimately recognised as an expense in the Statement of Profit and Loss, with
a corresponding credit to Employee Stock Compensation Reserve. If vesting periods or other vesting conditions
apply, the expense is allocated over the vesting period, based on the best available estimate of the number
of share options expected to vest. Non-market vesting conditions are included in assumptions about the
number of options that are expected to become exercisable. Estimates are subsequently revised, if there is any
indication that the number of share options expected to vest differs from previous estimates. Once vested, no
adjustment is made to expense recognised in prior periods if, ultimately, fewer share options are exercised than
originally estimated. Upon exercise of share options, the proceeds received (net of any directly attributable
transaction costs) up to the nominal value of the shares issued are allocated to share capital with any excess
being recorded as Securities Premium.
A.13. Borrowing Costs
Borrowing costs that are directly attributable to the acquisition or construction of qualifying assets are capitalised
as part of the cost of those assets. A qualifying asset is one that necessarily takes a substantial period of time
to get ready for intended use. All other borrowing costs are recognised as an expense in the Statement of Profit
and Loss in the period in which they are incurred.
A.14. Earning Per Share
In accordance with the Ind AS 33 "Earnings Per Share", basic / diluted earnings per share is computed by taking
the weighted average number of shares outstanding during the year.
A.15. Taxation
Tax expense for the year comprises of current tax and deferred tax.
The tax currently payable is based on the taxable profit for the year. Taxable profit differs from net profit, as
reported in the Statement of Profit and Loss, because it excludes items of income or expense that are taxable
or deductible in other years and it further excludes items that are never taxable or deductible. The Company's
liability for current tax is calculated using tax rates and tax laws that have been enacted or substantively
enacted by the end of the reporting period.
Deferred tax is the tax expected to be payable or recoverable on 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, and is accounted for using the balance sheet liability method. Deferred tax liabilities are generally
recognised for all taxable temporary differences. In contrast, deferred tax assets for all deductible temporary
differences and unused tax losses are only recognised to the extent that it is probable that future taxable profits
will be available against which the temporary differences can be utilised.
Deferred tax assets are reviewed at each balance sheet date for the appropriateness of their respective carrying
values.
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 offset where the entity 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 are recognised as an expense or income in the Statement of Profit and Loss, except
when they relate to items credited or debited either in other comprehensive income or directly in equity, in
which case the tax is also recognised in other comprehensive income or directly in equity.
Minimum Alternative Tax (MAT) paid in accordance with the tax laws in India, which gives rise to future
economic benefits in the form of adjustment of future income tax liability, is considered as an asset if there is
convincing evidence that the Company will pay normal income tax during the specified period. Accordingly,
MAT entitlement is recognised as an asset in the Balance Sheet when the asset can be measured reliably and
it is probable that the future economic benefit associated with it will fructify. Such asset is reviewed at each
balance sheet date and the carrying amount of MAT credit asset is written down to the extent there is no longer
a convincing evidence for the effect that the company will pay normal income tax during the specified period.
A.16. Warranty Cost
The Company accrues the estimated cost of warranties at the time when the revenue is recognised. The
accruals are based on the Company's historical experience of material usage and service delivery cost.
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