2.13. Provisions, Contingent Liabilities and Contingent Assets:
The Company recognizes provisions when there is present obligation as a result of past eventand it is probable that there will be an outflow of resources and reliable estimate can be madeof the amount of the obligation. A disclosure for Contingent liabilities is made in the notes onaccounts when there is a possible obligation or present obligations that may, but probably willnot, require an outflow of resources. Contingent assets are disclosed in the financial statements when flow of economic benefit isprobable.
2.14. Revenue Recognition
Revenue from construction/project related activity and contracts for supply/commissionirg ofcomplex plant and equipment is recognised as follows:
2.14.1. Cost plus contracts: Revenue from cost plus contracts is determined with reference to the recoverable costs incurred during the period and the margin as agreed with the customer.
2.14.2. Fixed price contracts: Contract revenue is recognised only to the extent of costincurred till such time the outcome of the job cannot be ascertained reliably subject tocondition that it is probable that such cost will be recoverable. When the outcome ofthe contract is ascertained reliably, contract revenue is recognised at cost of work performed on the contract plus proportionate margin, using the percentage ofcompletion method. Percentage of completions the proportion of cost of workperformed to-date, to the total estimated contract costs.
The estimated outcome of a contract is considered reliable when all the following conditionsare satisfied:
i. the amount of revenue can be measured reliably.
ii. it is probable that the economic benefits associated with the contract will flow to thecompany.
iii. the stage of completion of the contract at the end of the reporting period can bemeasured reliably; and
iv. the costs incurred or to be incurred in respect of the contract can be measuredreliably.
Expected loss, if any, on a contract is recognised as expense in the period in which it isforeseen, irrespective of the stage of completion of the contract.For contracts where progress billing exceeds the aggregate of contract costs incurred to-dateand recognised profits (or recognised losses, as the case may be), the surplus is shown as theamount due to customers. Amounts received before the related work is performed aredisclosed in the Balance Sheet as a liability towards advance received. Amounts billed forwork performed but yet to be paid by the customer are disclosed in the Balance Sheet as tradereceivables. The amount of retention money held by the customers is disclosed as part ofother current assets and is reclassified as trade receivables when it becomes due for payment.
2.15. Otherincome:
2.15.1. Dividend Income: Dividend income from Investments is recognised when the shareholder's right to receive payment has been established.
2.15.2. Interest income: Interest income from a financial asset is recognised when it is probable that the economic benefits will flow to the company and the amount of income can be measured reliably. Interest income is accrued on a time basis, by reference to the principal outstanding and at the effective interest rate applicable, which is the rate that exactly discounts estimated future cash receipts through the expected life of the financial asset to that asset net carrying amount on initial recognition.
2.16. Insurance claims
Insurance claims are accounted for on the basis of claims admitted / expected to be admittedand to the extent that the amount recoverable can be measured reliably and it is reasonable to expect ultimate collection.
2.17. Claims
Claims against the company not acknowledged as debts are disclosed under contingentliabilities. Claims made by the company are recognised as and when the same is approved by the respective authorities with whom the claim is lodged.
2.18. Commitments
Commitments are future liabilities for contractual expenditure. Commitments are classified and disclosed as follows
a) Estimated amount of contracts remaining to be executed on capital account and notprovided for
b) Uncalled liability on shares and other investments partly paid
c) Funding related commitment to subsidiary, associate and joint venture companies and Other noncancellable commitments, if any, to the extent they are considered material
d) and relevant in the opinion of management
e) Other commitments related to sales/procurements made in the normal course ofbusiness are not disclosed to avoid excessive details.
2.19. Foreign exchange translation and foreign currency transactions:
The functional currency and presentation currency of the Company is the Indian rupee.
Foreign currency transactions are accounted at the exchange rates prevailing on the date oftransactions. Gains and losses resulting from settlement of such transactions are recognised in the Statement of Profit and Loss.
Monetary assets and liabilities related to foreign currency transactions remaining unsettled at the end of the year are translated at year end rates. The difference in translation of monetary assets and liabilities and realized gains and losses on foreign exchange transactions are recognised in the Statement of Profit and Loss.
The exchange difference on restatement of long-term receivables / payables from / to foreign operations that are considered as net investments in such operation are recognised in the statement of profit or loss in the separate financial statements of the reporting entity or the individual financial statements of the foreign operation, as appropriate.
2.20. Employee Benefits:
Provident fund is defined Contribution scheme and contributions are charged to profit and loss account of the year when the contributions to the respective funds are due. Other retirement benefits such as Gratuity, leave encashment etc., are recognized on basis of an Actuarial Valuation.
2.21. Borrowing Costs:
Borrowing costs include interest expense calculated using the effective interest method and finance charges in respect of assets acquired on finance lease.
Borrowing costs, allocated to and utilised for qualifying assets, pertaining to the period from commencement of activities relating to construction / development of the qualifying asset up to the date of capitalisation of such asset are included in the cost of the assets. Capitalisation of borrowing costs is suspended and charged to the Statement of Profit and Loss during extended periods when active development activity on the qualifying assets is interrupted. All other borrowing costs are recognised in profit and loss in the period in which they are incurred.
2.22. Taxation:
Income tax expense represents sum of the tax currently payable and deferred tax.
2.22.1. Current Tax: Current tax is the amount of tax payable on the taxable income for theyear as determined in accordance with the applicable tax rates and the provisions of the Income tax Act, 1961.
2.22.2. Deferred tax: Deferred tax is recognised on temporary differences between the carrying amounts of assetsand liabilities in the Company’s financial statements and the corresponding tax bases used in the computation of taxable profit
Deferred tax assets are generally recognised for all deductible temporary differences to theextent that it is probable that taxable profits will be available against which those deductibletemporary differences can be utilised. Such deferred tax assets and liabilities are not recognised if the temporary differences arise from the initial recognition 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.
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
2.23. Leases:
Leases, where the lessor effectively retains substantially all the risks and benefits of ownership over the leased term, are classified as operating leases. Operating lease payments are recognised as an expense in the Statement of Profit and Loss on a straight -line basis over the lease term except where the lease payments are structured to increase in line with expected general inflation. Assets acquired on
finance lease are capitalised at fair value or present value of minimum lease payment at the inception of the lease, whichever is lower.
2.24. Fairvalue measurement
The Company measures certain financial instruments at fair value at each reporting date. Fair value is the price that would be received on sale of 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:
a. In the principal market for the asset or liability, or
b. In the absence of principal market, in the most advantageous market for the asset or liability.
The fair value of an asset or a liability is measured using the assumptions that marketparticipants would use when pricing the asset or liability, assuming that market participants act in their economic best interest.
The Company uses valuation techniques that are appropriate in the circumstances and for which sufficient ciata are available to measure fair value, maximizing the use of relevant observable inputs and minimising the use of unobservable inputs.
2.25. Earnings per Share:
Basic earnings per equity share are computed by dividing the net profit for the year attributable to the Equity Shareholders by the weighted average number of equity shares outstanding during the year. Diluted earnings per share is computed by dividing the net profit for the year, reduced for the effects of dilutive potential equity shares, attributable to the Equity Shareholders by the weighted average number of the equity shares and dilutive potential equity shares outstanding during the year except where the results are anti -dilutive.
2.27. Segment Reporting:
The Company has only Cotton Product activity hence segment report has not been given.
2.28. Related Party:
As per Accounting Standard 18, issued by the Institute of Chartered Accountants of India, the disclosures of transaction with the related parties as defined in Accounting Standards are givenbelow.
2.29. The company has long outstanding trade receivables of Rs.62.65 Crores in the books of accounts for more than 3 years and the management believes that these trade receivables are realizable and hence provision for doubtful debts not required to be provided.
2.30. Balances of the trade receivables, deposits, loans and advances, advances received from the customers and trade payables are subject to confirmation from the respective parties and consequential adjustments arising from reconciliation, if any. However, the management believes that there will not be any material changes to the balances as reflected in the books of accounts as on March 31,2024.
2.31. The inventory has been physically verified during the year by the management at regular intervals and the management believes that there will not be any material differences to the balances as reflected in the books of accounts as on March 31,2024.
2.32. Previous year figures have been regrouped/ rearranged where necessary to conform tocurrent year's classification.
2.33. All the Financial figures have been stated in lakhs except EPS and unless otherwise stated.
As per our report of even date For and on behalf of the Board of Directors of
For Pundarikashyam & Associates Filatex Fashions Limited
Chartered Accountants CIN: L51491TG1994PLC0171
FRN: 011330S
Sd/- Sd/-
„» „„ „ Prabhat Sethia Sangeeta Sethia
B. SURYA PRAKASA RAO Managing Director Director
Partner ...... (DIN: 00699415) (DIN:02600900)
Membership No: 205125
UDIN: 24205125BKADWD7095
Sd/- Sd/-
Place- Hvderaabd Yash Sethia Srinivasa Rao Chintala
Date' 30 05 2 024 Chief Financial Officer Company Secretary
|