Material Accounting Policy Information
This note provides a list of the material accounting policies adopted in the preparation of these financial statements. These policies
have been consistently applied to all the years presented, unless otherwise stated.
2.1 Basis of Preparation
The Financial Statements have been prepared in accordance with the Indian Accounting Standards (referred to as "Ind AS") notified
under Section 133 of the Companies Act, 2013 ("the Act") read with the Companies (Indian Accounting Standards) Rules, 2015 and
other relevant provisions of the Act and the Rules made thereunder (as amended from time to time) and applicable RBI directions.
The Company presents its Standalone Financial Statements to comply with Division III of Schedule III to the Act which provides
general instructions for the preparation of Financial Statements of a Non-Banking Financial Company (NBFC to comply with Ind AS)
and the requirements of Ind AS. An analysis regarding recovery or settlement within 12 months after the reporting date (current) and
more than 12 months after the reporting date (non-current) is presented in Note 41.
Financial Assets and Financial Liabilities are generally reported gross in the Balance Sheet. They are only offset and reported net
when, in addition to having an unconditional legally enforceable right to offset the recognised amounts without being contingent
on a future event, the parties also intend to settle on a net basis in all of the following circumstances:
• The normal course of business
• The event of default
The Standalone Financial Statements have been prepared and presented on the Going Concern basis and at Historical Cost, except
for the following assets and liabilities, which have been subsequently measured at fair value:
• Certain Financial assets and liabilities at fair value (Refer Note 2.4)
• Employee's Defined Benefit Plan as per actuarial valuation (Refer Note 2.11)
2.2 Functional and Presentation Currency
The Standalone Financial Statements are presented in Indian Rupees, which is the functional currency of the Company and the
currency of the primary economic environment in which the Company operates. All Financial information presented in INR has been
rounded off to thousands, unless otherwise stated.
2.3 Use of Estimates and Judgements
The preparation of the Standalone Financial Statements in conformity with Ind AS requires the management of the Company to
make estimates, assumptions and judgements that affect the reported balances of assets and liabilities and disclosures relating to
the contingent liabilities as at the date of the financial statements and reported amounts of income and expenses for the reporting
period. The application of accounting policies that require critical accounting estimates involving complex and subjective
judgements and the use of assumptions in the financial statements have been disclosed as applicable in the respective notes to
accounts. Changes in estimates are reflected in the Standalone Financial Statements in the period in which changes are made and,
if material, their effect are disclosed in the notes to the Standalone Financial Statements.
This note provides an overview of the areas where there is a higher degree of judgement or complexity. Detailed information about
each of these estimates and judgements is included in relevant notes together with information about the basis of calculation.
The areas involving critical estimates or judgements are:
• Defined Benefit Obligations - Note 2.11
• Recognition of Revenue - Note 2.12
• Current Tax- Note 2.14
• Deferred Tax - Note 2.14
• Impairment of Financial Assets - Note 2.6
Estimates and assumptions are continuously evaluated based on most recent available information. Revisions to accounting
estimates are recognised prospectively in the Standalone Statement of Profit and Loss in the period in which the estimates are
revised and future period affected.
Although these estimates are based on managements' best knowledge of current events and action, uncertainty about these
assumptions and estimates could result in outcomes requiring a material adjustment to the carrying amounts of assets and liabilities
in future periods.
2.4 Fair Value Measurement
The Company measures financial instruments and other derivatives at fair values except Equity Investments in Joint Ventures and
Associates at each Balance Sheet date.
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. The fair value measurement is based on the presumption that the transaction to sell the asset
or transfer the liability takes place either:
• In the principal market for the asset or liability, or
• In the absence of a principal market, the most advantageous market for the asset or liability.
The principal or the most advantageous market must be accessible by the Company.
The fair value of an asset or a liability is measured using the assumptions that market participants would use when pricing the asset
or liability, assuming that market participants act in their best economic interest.
A fair value measurement of a Non-Financial Asset takes into account a market participant's ability to generate economic benefits
by using the asset in its highest and best use or by selling it to another market participant that would use the asset in its highest and
best use.
The Company uses valuation techniques that are appropriate in the circumstances and for which sufficient data are available to
measure fair value, maximising the use of relevant observable inputs and minimising the use of unobservable inputs.
All assets and liabilities (for which fair value is measured or disclosed in the Standalone Financial Statements) are categorised within
the fair value hierarchy, described as follows, based on the lowest level input that is significant to the fair value measurement as a
whole:
Level 1 - Quoted (unadjusted) market prices in active markets for identical assets or liabilities.
Level 2 - Valuation techniques for which the lowest level input that is significant to the fair value measurement is directly or
indirectly observable.
Level 3 - Valuation techniques for which the lowest level input that is significant to the fair value measurement is unobservable.
For assets and liabilities that are recognised in the Standalone Financial Statements on a recurring basis, the Company determines
whether transfers have occurred between levels in the hierarchy by re-assessing categorisation (based on the lowest level input that
is significant to the fair value measurement as a whole) at the end of each reporting period.
The management determines the policies and procedures for both recurring fair value measurement, such as derivative instruments
and unquoted Financial Assets measured at fair value, and for non-recurring measurement, such as assets held for disposal in
discontinued operations.
At each reporting date, the management analyses the movements in the values of assets and liabilities, which are required to be
remeasured or re-assessed as per the Company's accounting policies. For this analysis, the management verifies the major inputs
applied in the latest valuation by agreeing the information in the valuation computation to contracts and other relevant documents.
2.5 Property, Plant and Equipment (PPE) and Depreciation
PPE are stated at Acquisition or Construction cost less Accumulated Depreciation and Impairment Loss. Cost comprises the purchase
price and any attributable cost of bringing the asset to its location and working condition for its intended use, including relevant
borrowing costs and any expected costs of decommissioning (if any).
The cost of an item of PPE is recognised as an asset if, and only if, it is probable that the economic benefits associated with the item
will flow to the Company in future periods and the cost of the item can be measured reliably. Expenditure incurred after the PPE have
been put into operations, such as repair and maintenance expenses are charged to the Standalone Statement of Profit and Loss
during the year in which they are incurred.
2.5.1 Depreciation
Depreciation is recognised so as to write-off the Cost of assets less their Residual values as per Written Down Value method, over the
estimated Useful lives as prescribed in Schedule II to the Act.
Residual value is estimated as 5% of the original cost of PPE.
The PPE's residual values and useful lives are reviewed, at each financial year end, and if expectations differ from previous estimates
the same is accounted for as change in accounting estimates.
Depreciation on additions to/deductions from PPE during the year is charged on pro-rata basis from the date of such addition or, as
the case may be, up to the date on which such asset has been available for use/disposed of.
2.5.2 Derecognition
An item of PPE 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 de-recognition of an item of PPE is determined as the difference between the net disposal
proceeds and the carrying amount of the asset and is recognised in the Standalone Statement of Profit and Loss.
2.6 Financial Instruments
A Financial Instrument is any contract that gives rise to a Financial Asset of one entity and a financial liability or equity instrument of
another entity.
2.6.1 Financial Assets
Initial recognition and measurement
All Financial assets are recognised initially at fair value. However, in the case of financial assets not recorded at fair value through
profit or loss, transaction costs that are attributable to the acquisition of the financial asset are included therein.
Subsequent measurement
For the purposes of subsequent measurement, financial assets are classified in four categories:
• Debt Instruments at Amortised cost
• Debt Instruments at Fair Value Through Other Comprehensive Income (FVTOCI)
• Debt Instruments, Derivatives and Equity Instruments, Mutual funds at Fair Value Through Profit or Loss (FVTPL)
• Equity Instruments measured at Fair Value Through Other Comprehensive Income (FVTOCI)
Debt Instruments at Amortised Cost
A 'Debt Instrument' is measured at the amortised cost if both the following conditions are met:
a) The asset is held within a business model whose objective is to hold assets for collecting contractual cash flows, and
b) Contractual terms of the asset give rise on specified dates to cash flows that are Solely Payments of Principal and Interest
(SPPI) on the principal amount outstanding.
After initial measurement, such financial assets are subsequently measured at amortised cost using the Effective Interest Rate (EIR)
method. Amortised cost is calculated by taking into account any discount or premium on acquisition and fees or costs that are an
integral part of the EIR. The EIR amortisation is included in Finance Income in the Standalone Statement of Profit and Loss. The losses
arising from impairment are recognised in the Standalone Statement of Profit and Loss.
Debt Instruments at FVTOCI
A 'Debt Instrument' is classified as at the FVTOCI if both of the following criteria are met:
a) The objective of the business model is achieved both by collecting contractual cash flows and selling the Financial assets, and
b) The asset's contractual cash flows represent Solely Payments of Principal and Interest (SPPI).
Debt instruments included within the FVTOCI category are measured initially as well as at each reporting date at fair value. Fair value
movements are recognised in the Other Comprehensive Income (OCI). However, the Company recognises interest income,
impairment losses & reversals and foreign exchange gain or loss in the Standalone Statement of Profit and Loss.
On derecognition of the asset, cumulative gain or loss previously recognised in OCI is reclassified from the equity to the Standalone
Statement of Profit and Loss. Interest earned whilst holding FVTOCI debt instrument is reported as interest income using the EIR
method.
Debt Instruments at FVTPL
FVTPL is a residual category for debt instruments. Any debt instruments, which does not meet the criteria for categorisation as at
amortised cost or as FVTOCI, is classified as at FVTPL.
In addition, the Company may elect to designate a debt instrument, which otherwise meets amortised cost or FVTOCI criteria, as at
FVTPL. However, such election is allowed only if doing so reduces or eliminates a measurement or recognition inconsistency
(referred to as 'accounting mismatch').
Debt instruments included within the FVTPL category are measured at fair value with all changes recognised in the Standalone
Statement of Profit and Loss.
Equity Instruments
All equity investments (other than investments in associates and joint ventures) are measured at fair value. Equity instruments which
are held for trading are classified as at FVTPL. For equity instruments other than held for trading, the Company has irrevocable option
to present in OCI subsequent changes in the fair value. The Company makes such election on an instrument-by-instrument basis.
The classification is made on initial recognition and is irrevocable.
Where the Company classifies equity instruments as at FVTOCI, then all fair value changes on the instrument, excluding dividends,
are recognised in the OCI. There is no recycling of the amounts from OCI to the Standalone Statement of Profit and Loss, even on sale
of investments.
Equity instruments included within the FVTPL category are measured at fair value with all changes recognised in the Standalone
Statement of Profit and Loss.
Classification and Provisioning
Loan asset classification of the Company is given in the table below :
Impairment of Financial Assets
The Company applies the Expected Credit Loss model for recognising impairment loss on financial assets measured at amortised
cost, debt instruments at FVTOCI, lease receivables, trade receivables, and other contractual rights to receive cash or other financial
assets, and financial guarantees not designated as at FVTPL.
The Company measures the expected credit loss associated with its assets based on historical trend, industry practices and the
business environment in which the entity operates or any other appropriate basis. The impairment methodology applied depends
on whether there has been a significant increase in credit risk.
Write off
Loans and debt securities are written off when the Company has no reasonable expectations of recovering the financial assets
(either in its entirety or a portion of it). This is the case when the Company determines that the borrower does not have assets or
sources of income that could generate sufficient cash flows to repay the amounts subject to the write-off. A write-off constitutes a
de-recognition event.
De-recognition of Financial Assets
A Financial Asset (or, where applicable, a part of a Financial Asset or part of a group of similar Financial Assets) is primarily
derecognised (i.e. removed from the Balance Sheet) when:
a) The rights to receive cash flows from the asset have expired, or
b) The Company has transferred its rights to receive cash flows from the asset or has assumed an obligation to pay the received
cash flows in full without material delay to a third party under a 'pass-through' arrangement; and either (a) the Company has
transferred substantially all the risks and rewards of the asset, or (b) the Company has neither transferred nor retained
substantially all the risks and rewards of the asset, but has transferred control of the asset.
When the Company has transferred its rights to receive cash flows from an asset or has entered into a pass-through arrangement, it
evaluates if and to what extent it has retained the risks and rewards of ownership. When it has neither transferred nor retained
substantially all of the risks and rewards of the asset, nor transferred control of the asset, the Company continues to recognise the
transferred asset to the extent of the Company's continuing involvement. In that case, the Company also recognises an associated
liability.
The transferred asset and the associated liability are measured on a basis that reflects the rights and obligations that the Company
has retained.
Continuing involvement that takes the form of a guarantee over the transferred asset is measured at the lower of the original
carrying amount of the asset and the maximum amount of consideration that the Company could be required to repay.
Reclassification of Financial assets
The Company determines classification of financial assets and liabilities on initial recognition. After initial recognition, no
reclassification of financial assets like equity instruments and financial liabilities is made. For financial assets which are debt
instruments, a reclassification is made only if there is a change in the business model for managing those assets. Changes to the
business model are expected to be infrequent. The Company's senior management determines change in the business model as a
result of external or internal changes which are significant to the Company's operations. Such changes are evident to external
parties. A change in the business model occurs when the Company either begins or ceases to perform an activity that is significant
to its operations. If the Company reclassifies financial assets, it applies the reclassification prospectively from the reclassification date
which is the first day of the immediately next reporting period following the change in business model. The Company does not
restate any previously recognised gains, losses (including impairment gains or losses) or interest.
The following table shows various reclassification and how they are accounted for:
Investments in Associates and Joint Ventures
Investments in Associates and Joint ventures are accounted for at cost in the Standalone Financial Statements and the same are
tested for impairment in case of any indication of impairment.
2.6.2 Financial Liabilities and Equity Instruments
Classification as Debt or Equity
Debt and equity instruments, issued by the Company, are classified as either financial liabilities or as equity in accordance with the
substance of the contractual arrangements 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 instruments issued by the Company are recognised at the proceeds received, net of direct issue costs.
Financial Liabilities
Initial Recognition
All Financial liabilities are recognised initially at fair value and in the case of loans and borrowings and payables, are recognised net
of directly attributable transaction costs.
The Company's financial liabilities include trade and other payables, loans and borrowings including bank overdrafts, debt securities
and other borrowings.
Subsequent Measurement
After initial recognition, all financial liabilities are subsequently measured at FVTPL except borrowings which are measured at
amortised cost using the Effective Interest Rate (EIR) method. Any gains or losses arising on derecognition of liabilities are recognised
in the Standalone Statement of Profit and Loss.
De-recognition of Financial Liabilities
The Company de-recognises financial liabilities when and only when, the Company's obligations are discharged, cancelled or have
expired. The difference between the carrying amount of the financial liability de-recognised and the consideration paid and payable
is recognised in the Standalone Statement of Profit and Loss.
Finance costs
Borrowing costs on financial liabilities are recognised using the EIR Method as explained above.
Offsetting of Financial Instruments
Financial assets and financial liabilities are offset and the net amount is reported in the Standalone Balance Sheet, if there is a
currently enforceable legal right to offset the recognised amounts and there is an intention to settle on a net basis, to realise the
assets and settle the liabilities simultaneously.
2.7 Expected Credit Loss
Expected Credit Losses ('ECL') are recognised for Financial Assets held under amortised cost, debt instruments measured at FVTOCI,
and certain loan commitments as approved by the Board and internal policies for business model.
At initial recognition, allowance (or provision in the case of loan commitments) is required for ECL resulting from default events that
are possible in the next 12 months, or less, where the remaining life is less than 12 months.
In the event of a significant increase in credit risk, allowance (or provision) is required for ECL resulting from all possible default
events over the expected life of the financial instrument ('lifetime ECL').
Financial Assets where 12 months ECL is recognised are considered to be in 'stage 1'; Financial Assets that are considered to have
significant increase in credit risk are considered to be in 'stage 2'; and Financial Assets which are in default or Financial Assets for
which there is objective evidence of impairment are considered to be in 'stage 3'.
The treatment of the different stages of Financial Assets and the methodology of determination of ECL is set out below:
Unimpaired and without significant increase in credit risk (stage 1)
ECL resulting from default events that are possible in the next 12 months are recognised for financial instruments that remain in
stage 1.
We have ascertained default events based on past behavioural trends witnessed for each homogenous portfolio. These trends are
established based on customer centric scores, economic trends of industry segments in wholesale portfolios.
Significant increase in credit risk (stage 2)
An assessment of whether credit risk has increased significantly since initial recognition is performed at each reporting period by
considering the change in the risk of default occurring over the remaining life of the loan exposure. However, unless identified at an
earlier stage, the Company have determined all assets deemed to have suffered a significant increase in credit risk when 30 days past
due.
Based on other indications of borrower's delaying payments beyond due dates though not 30 days past due and other indications
like non-cooperative borrowers, customer's overall indebtedness, death of customer, adverse impact on the business, serious
erosion in the value of the underlying collateral, certain accounts are included in stage 2.
The measurement of risk of defaults under stage 2 are done by classifying them into homogenous portfolios, generally by nature of
loans, tenors, underlying collateral, geographies and borrower profiles.
The default risk is assessed using probability of default (PD) derived from past behavioural trends of default across the identified
homogenous portfolios.
For retail portfolios in stage 2, the probability of defaults initially based on are average lifetime probability of defaults experienced
for stage 2 customers in each homogenous groups in the past. These past trends factor in the past customer centric behavioural
trends, credit transition probabilities and macroeconomic conditions. The assessed probability of defaults are then aligned consid¬
ering future economic conditions that are determined to have a bearing on ECL.
For wholesale loans, the default risk is established based on multiple factors like Nature of security, Customer industry segments
external credit ratings, credit transition probabilities, current conditions and future macroeconomic conditions.
Credit impaired (stage 3)
The Company determines that a Financial asset is credit impaired and in stage 3 by considering relevant objective evidence, primari¬
ly whether
• Contractual payments of either principal or interest are past due for more than 90 days;
• The loan is otherwise considered to be in default
Interest income is recognised by applying the effective interest rate to the net amortised cost amount i.e. gross carrying amount less
ECL allowance.
Movement between stages
Financial assets can be transferred between different categories depending on their relative increase in credit risk since initial recog¬
nition. Financial assets are transferred out of stage 2 if their credit risk is no longer considered significantly increased since initial
recognition based on assessments described above.
Except for restructured assets, financial assets are transferred out of stage 3 when they no longer exhibit any evidence of credit
impairment as described above. Restructured loans continue to be in stage 3 until they exhibit regular payment of renegotiated
principal and interest over a minimum observation period typically 12 months post renegotiation, and there are no other indicators
of impairment. Having satisfied the conditions of timely payment over the observation period these loans could be transferred to
stage 1 or 2 and a fresh assessment of the risk of default be done for such loans.
Restructured Financial assets
A loan where repayment terms are renegotiated on substantially different terms as compared to the original contracted terms due
to significant credit distress of the borrower are classified as credit impaired.
Measurement of ECL
The assessment of credit risk and the estimation of ECL are unbiased and probability weighted and incorporates all information that
is relevant including information about past events, current conditions and reasonable forecasts of future events and economic
conditions at the reporting date. In addition, the estimation of ECL takes into account the time value of money, a Probability of
Default (PD), a Loss Given Default (LGD) and the Exposure at Default (EAD).
ECL is calculated by multiplying the PD, LGD and EAD. For stage 1 assets, the 12 months ECL is calculated. For assets in stage 2 and
3, Lifetime ECL is calculated using the lifetime PD.
The EAD represents the expected balance at default, taking into account the repayment of principal and interest from the Balance
Sheet date to the date of default together with any expected draw downs of committed facilities.
The LGD represents expected losses on the EAD given the event of default, taking into account, among other attributes, the mitigat¬
ing effect of collateral value at the time it is expected to be realised and the time value of money.
The ECL for stage 2 and stage 3 is determined based on the expected future cash flows based on the estimates supported by past
trends. Collateral is taken into account if it is likely that the recovery of the outstanding amount will include realisation of collateral
based on the estimated value of the collateral at the time of estimated realisation, less costs for obtaining and selling the collateral.
The cash flows are discounted at a reasonable approximation of the original effective interest rate.
2.8 Cash and Cash Equivalents
Cash and Cash Equivalents comprise cash in hand and cash at bank including fixed deposits with original maturity period of three
months or less and short-term highly liquid investments with an original maturity of three months or less which are subject to
insignificant risk of changes in value.
2.9 Earnings Per Share (EPS)
The basic EPS is computed by dividing the profit/loss after tax for the year attributable to the equity shareholders by the weighted
average number of Equity Shares outstanding during the year.
For the purpose of calculating diluted EPS, profit/loss after tax for the year attributable to the equity shareholders and the weighted
average number of Equity Shares outstanding during the year is adjusted for the effects of all dilutive potential Equity Shares.
2.10 Impairment of Non-Financial Assets
At the end of each reporting period, the Company reviews the carrying amounts of Non-Financial Assets to determine whether
there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of
the asset is estimated in order to determine the extent of the impairment loss (if any). When it is not possible to estimate the recover¬
able amount of an individual asset, the Company estimates the recoverable amount of the cash-generating unit to which the asset
belongs. When a reasonable and consistent basis of allocation can be identified, corporate assets are also allocated to individual
cash-generating units, or otherwise they are allocated to the smallest cash-generating units for which a reasonable and consistent
allocation basis can be identified. Recoverable amount is the higher of fair value less costs of disposal and value in use.
If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount
of the asset (or cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised immediately in the
Standalone Statement of Profit and Loss.
2.11 Employee Benefits
Short-Term Employee Benefits
Liabilities for salaries and wages, including non-monetary benefits in respect of employees' services up to the end of the reporting
period, are recognised as liabilities (and expensed) and are measured at the amounts expected to be paid when the liabilities are
settled. The liabilities are presented as current employee benefit obligations in the Standalone Balance Sheet.
Post-employment Benefits
Defined Contribution Plan
Employee Benefits under defined contribution plans comprises of Contributory Provident Fund, Post Retirement Benefit Scheme,
etc. are recognized based on the undiscounted amount of obligations of the Company to contribute to the plan.
Defined Benefits Plan
Defined Benefits plan comprising of gratuity, post-retirement medical benefits and other terminal benefits, are recognized based on
the present value of defined benefit obligations which are computed using the projected unit credit method, with actuarial
valuations being carried out at the end of each annual reporting period. These are accounted either as current employee cost or
included in cost of assets as permitted.
The net interest cost is calculated by applying the discount rate to the net balance of the defined benefit obligation and the fair
value of plan assets. This cost is included in employee benefits expense in the Standalone Statement of Profit and Loss.
Re-measurement gains and losses arising from experience adjustments and changes in actuarial assumptions are recognised in the
period in which they occur, directly in other comprehensive income. They are included in retained earnings in the Standalone
Statement of Changes in Equity and in the Standalone Balance Sheet through Other Comprehensive Income. Changes in the
present value of the defined benefit obligation resulting from plan amendments or curtailments are recognised immediately in
profit or loss as past service cost.
Other Long-Term Employee Benefits
Other long-term employee benefits comprise of leave encashment towards un-availed leave and compensated absence, these are
recognized based on the present value of defined obligation which is computed using the projected unit credit method, with
actuarial valuations being carried out at the end of each annual reporting period. These are accounted either as current employee
cost or included in cost of assets as permitted.
Re-measurement of leave encashment towards un-availed leave and compensated absences are recognized in the Standalone
Statement of Profit and Loss except those included in cost of assets as permitted in the period in which they occur.
2.12 Revenue Recognition
Revenue is recognised to the extent that it is probable that the economic benefit will flow to the Company and the revenue can be
reliably measured.
a. Interest Income
Interest income is accounted for all financial instruments measured at Amortised Cost or at Fair Value Through Other Comprehen¬
sive Income, interest income is recorded using the Effective Interest Rate (EIR), which is the rate that exactly discounts the estimated
future cash payments or receipts through the expected life of the financial instruments to the gross carrying amount of the financial
asset. Interest income on all trading assets and Financial Assets mandatorily required to be measured at FVTPL is recognised using
the contractual interest rate in net gain on fair value changes.
b. Dividend Income
Dividend Income is recognized as and when the Company's rights to receive the payment is established, it is probable that the
economic benefits associated with the dividend will flow to the entity, the dividend does not represent a recovery of part of cost of
the investment and the amount of dividend can be measured reliably.
2.13 Borrowings Costs
Borrowing costs attributable to acquisition and construction of qualifying assets are capitalised as a part of the cost of such assets up
to the date when such assets are ready for its intended use.
Other borrowing costs are charged to the Standalone Statement of Profit and Loss in the period in which they are incurred.
2.14 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 for each jurisdiction adjusted by changes in deferred tax assets and liabilities attributable to temporary differences
and unused tax losses.
Current Tax
Current tax comprises the expected tax payable or receivable on the taxable income or loss for the year and any adjustment to the
tax payable or receivable in respect of previous years. The amount of current tax reflects the best estimate of the tax amount expect¬
ed to be paid or received after considering the uncertainty, if any, related to income taxes. It is measured using tax rates (and tax law)
enacted or substantively enacted by the reporting date.
Current tax assets and liabilities are offset only if there is a legally enforceable right to set off the recognised amounts and it is intend¬
ed to realise the asset and settle the liability on a net basis or simultaneously.
Deferred Tax
Deferred tax assets and liabilities are recognised for the future tax consequences of temporary differences between the carrying
values of assets and liabilities in the Standalone 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 each reporting date and reduced to the extent that it is no longer probable
that sufficient taxable profit will be available to allow all or part of the deferred tax asset to be utilised. Unrecognised deferred tax
assets are re-assessed at each reporting date and are recognised to the extent that it has become probable that future taxable profits
will allow the deferred tax asset to be recovered.
Deferred tax assets and liabilities are measured based on the tax rates that are expected to apply in the period when the asset is
realised or the liability is settled, based on tax rates and tax laws that have been enacted or substantively enacted by the balance
sheet date.
Deferred tax relating to items recognised outside profit or loss is recognised outside profit or loss (either in other comprehensive
income or in equity). Deferred tax items are recognised in correlation to the underlying transaction either in Other Comprehensive
Income or directly in equity.
Deferred tax assets and tax liabilities are offset where the entity has a legally enforceable right to set off current tax assets against
current tax liabilities and when they relate to income taxes levied by the same taxation authority and the Company intends to settle
on a net basis.
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